Fire Hydrant of Freedom
Politics, Religion, Science, Culture and Humanities => Politics & Religion => Topic started by: Body-by-Guinness on December 05, 2006, 07:24:45 AM
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If hydrocarbons are renewable- then is "Peak Oil" a fraud?
by Joel Bainerman
Are hydrocarbons "renewable"- and if so- what does such a conclusion mean for the future of the world's oil and natural gas supplies?
The question is critical due to the enormous amount of coverage the issue of "Peak Oil" is receiving from the mainstream press. If the supply of hydrocarbons is renewable- then the contrary to the conventional wisdom being touted throughout the mainstream press today- the world is NOT running out of oil.
Unbeknownst to Westerners, there have actually been for quite some time now two competing theories concerning the origins of petroleum. One theory claims that oil is an organic 'fossil fuel' deposited in finite quantities near the planet's surface. The other theory claims that oil is continuously generated by natural processes in the Earth's magma.
One of the world's leading advocates for the theory that hydrocarbons are renewable is Dr. Thomas Gold who contends that oil is not a limited resource, and that oil, natural gas and coal, are not so-called “fossil fuels.”
In his book, The Deep Hot Biosphere: The Myth of Fossil Fuels, he explains that dinosaurs and plants and the fossils from those living beings are not the origin of oil and natural gas, but rather generated from a chemical substance in the crust of the Earth.
Dr. Gold: "Astronomers have been able to find that hydrocarbons, as oil, gas and coal are called, occur on many other planetary bodies. They are a common substance in the universe. You find it in the kind of gas clouds that made systems like our solar system. You find large quantities of hydrocarbons in them. Is it reasonable to think that our little Earth, one of the planets, contains oil and gas for reasons that are all its own and that these other bodies have it because it was built into them when they were born? That question makes a lot of sense. After all, they didn’t have dinosaurs and ferns on Jupiter to produce oil and gas?"
He continues: "Human skull fossils have been found in anthracite coal in Pennsylvania. The official theory of the development of coal will not accept that reality, since human beings were not around when anthracite coal was formed. Coal was formed millions of years ago. However, you cannot mistake the fact that these are human fossils."
"The coal we dig is hard, brittle stuff. It was once a liquid, because we find embedded in the middle of a six-foot seam of coal such things as a delicate wing of some animal or a leaf of a plant. They are undestroyed, absolutely preserved; with every cell in that fossil filled with exactly the same coal as all the coal on the outside. A hard, brittle coal is not going to get into each cell of a delicate leaf without destroying it. So obviously that stuff was a thin liquid at one time which gradually hardened."
Gold claims that the only thing we find now on the Earth that would do that is petroleum, which gradually becomes stiffer and harder. That is the only logical explanation for the origin of coal. So the fact that coal contains fossils does not prove that it is a fossil fuel; it proves exactly the opposite. Those fossils found in coal prove that coal is not made from those fossils. Where then does the carbon base come from that produces all of this?
Says Dr. Gold: "Petroleum and coal were made from materials in which heavy hydrocarbons were common components. We know that because the meteorites are the sort of debris left over from the formations of the planets and those contain carbon in unoxidized form as hydrocarbons as oil and coal-like particles. We find that in one large class of meteorites and we find that equally on many of the other planetary bodies in the solar system. So it’s pretty clear that when the Earth formed it contained a lot of carbon material built into it."
Dr. Gold's ideas would lead us to believe that there is so much natural gas in the earth that it is causing earthquakes in trying to escape from the Earth. If you’ll drill deep enough anywhere, you will find natural gas. It may not be in commercial quantities every time, but more than likely it will be.
Is the oil and gas industry reconsidering things in light of his work?
Absolutely not.
"In many other countries they are listening to me: in Russia on a very large scale, and in China also. It is just Western Europe and the United States that are so stuck in the mud that they can’t look at anything else."
What do the Russians know that the West don't?
The roots of Dr. Gold's theories are in Russia where scientists since the end World War II have been researching what is referred to as the "Modern Russian-Ukrainian Theory of Deep, Abiotic Petroleum Origins."
Although the theory was first expounded upon by Professor Nikolai Kudryavtsev in 1951 it is not the work of any one single man but has been developed by hundreds of scientists in the (now former) U.S.S.R..
The theory of deep, abiotic petroleum origins is not a vague, qualitative hypothesis, but stands as a rigorous analytic theory within the mainstream of the modern physical sciences. In this respect, the modern theory differs fundamentally not only from the previous hypothesis of a biological origin of petroleum but also from all traditional geological hypotheses.
Actually, since the nineteenth century, knowledgeable physicists, chemists, thermodynamicists, and chemical engineers have regarded with grave reservations (if not outright disdain) the suggestion that highly reduced hydrocarbon molecules of high free enthalpy (the constituents of crude oil) might somehow evolve spontaneously from highly oxidized biogenic molecules of low free enthalpy. Beginning in 1964, Soviet scientists carried out extensive theoretical statistical thermodynamic analysis which established explicitly that the hypothesis of evolution of hydrocarbon molecules (except methane) from biogenic ones in the temperature and pressure regime of the Earth's near-surface crust was glaringly in violation of the second law of thermodynamics.
The theory of deep, abiotic petroleum origins is presently applied extensively throughout the former U.S.S.R. as the guiding perspective for petroleum exploration and development projects. There are presently more than 80 oil and gas fields in the Caspian district alone which were explored and developed by applying the perspective of the modern theory and which produce from the crystalline basement rock.
Similarly, such exploration in the western Siberia cratonic-rift sedimentary basin has developed 90 petroleum fields of which 80 produce either partly or entirely from the crystalline basement. The exploration and discoveries of the 11 major and 1 giant fields on the northern flank of the Dneiper-Donets basin have already been noted. There are presently deep drilling exploration projects under way in Azerbaijan, Tatarstan, and Asian Siberia directed to testing potential oil and gas reservoirs in the crystalline basement.
Is "Peak Oil" a fraud?
So why is the western media being inundated with notions of the world running out of oil?
One could point a finger at the multinational oil companies and their vested interest in having the price of a barrel of oil rise substantially- to justify further exploration expenses- and of course- to bolster their bottom line.
Says Dr. J.F. Kenney, a long-time research on the origins of hydrocarbons:
"For almost a century, various predictions have been made that the human race was imminently going to run out of available petroleum. The passing of time has proven all those predictions to have been utterly wrong. It is pointed out here how all such predictions have depended fundamentally upon an archaic hypothesis from the 18th century that petroleum somehow (miraculously) evolved from biological detritus, and was accordingly limited in abundance."
That hypothesis has been replaced during the past forty years by the modern Russian-Ukrainian theory of abyssal, abiotic petroleum origins which has established that petroleum is a primordial material erupted from great depth. Therefore, according to Kenney, petroleum abundances are limited by little more than the quantities of its constituents as were incorporated into the Earth at the time of its formation.
As far back as 1757, in his address at the Imperial Academy of Sciences in St. Petersburg, Academician Mikhailo V. Lomonosov, stated:
"Rock oil originates as tiny bodies of animals buried in the sediments which, under the influence of increased temperature and pressure acting during an unimaginably long period of time, transform into rock oil [petroleum , or crude oil]"
More than 200 years later, Professor Emmanuil Chekaliuk told the conference on Petroleum and Petroleum Geology in Moscow that:
"Statistical thermodynamic analysis has established clearly that hydrocarbon molecules which comprise petroleum require very high pressures for their spontaneous formation, comparable to the pressures required for the same of diamond. In that sense, hydrocarbon molecules are the high-pressure polymorphs of the reduced carbon system as is diamond of elemental carbon. Any notion which might suggest that hydrocarbon molecules spontaneously evolve in the regimes of temperature and pressure characterized by the near-surface of the Earth, which are the regimes of methane creation and hydrocarbon destruction, does not even deserve consideration."
Contrarily, the statistics of the international petroleum industry establish that, far from diminishing, the net known recoverable reserves of petroleum have been growing steadily for the past fifty years. Those statistics show that, for every year since about 1946, the international petroleum industry has discovered at least five new tons of recoverable oil for every three which have been consumed.
As Professor P. Odell of the London School of Economics has put it, instead of "running out of oil," the human race by every measure seems to be "running into oil".
Says Dr. Kenney: "There stands no reason to worry about, and even less to plan for, any predicted demise of the petroleum industry based upon a vanishing of petroleum reserves. On the contrary, these considerations compel additional investment and development in the technology and skills of deep drilling, of deep seismic measurement and interpretation, of the reservoir properties of crystalline rock, and of the associated completion and production practices which should be applied in such non-traditional reservoirs"
If Kenney is correct, not only are any predictions that the world is "running out of oil" invalid, so also are suggestions that the petroleum exploration and production industry is a "mature" or "declining" one.
The impact on the planet of the conclusions of this debate
Much research remains to be done on "alternative" theories of the how much hydrocarbons are left in the world- unfortunately- those entities most able to do this research- the western multinational oil conglomerates- have the least interest in arriving at any conclusion other than those that are part of the "Peak Oil" stream of thought. Today the mainstream press has accepted as a given that the world has only a finite amount of oil and natural gas- and thus any decision taken on how to deal with the world's future needs are based on these conclusions. If they are erroneous- then the world is about to embark on a plan to provide for its energy needs for the coming century based on a false notion.
Research geochemist Michael Lewan of the U.S.Geological Survey in Denver, is one of the most knowledgeable advocates of the opposing theory, that petroleum is a "fossil fuel". Yet even Lewan admits:
"I don't think anybody has ever doubted that there is an inorganic source of hydrocarbons. The key question is, 'Do they exist in commercial quantities?'"
We might never know the answer to that question because both sides of this debate are not being heard by the general public. If the Russians have accepted the theory that hydrocarbons are renewable- and over time they will become the leading exporters of oil and gas worldwide- this fact alone requires these alternative theories of how fossil fuels are created- is required.
It behooves western governments to begin taking these alternative theories seriously- and design future energy policies based on possibility that they are correct. Whatever strategies for meeting the world's ferocious appetite for energy are devised today- will impact the planet for decades to come.
In this issue- we simply can't afford to be wrong.
Joel Bainerman
Joel Bainerman has been a writer on economic and Middle East issues since 1983. His published archive can be viewed on his website at www.joelbainerman.com
His new online, multi-lingual alternative newsmagazine for Europeans can be viewed at www.theotherside.org.uk
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House GOP pulls offshore drilling bill
By H. JOSEF HEBERT, Associated Press Writer 53 minutes ago
WASHINGTON - House Republicans abruptly pulled from floor action Tuesday a bill to open a large area of the eastern Gulf of Mexico to oil and gas drilling after it became clear the legislation lacked the two-thirds vote needed for passage.
The bill, which has already passed the Senate, was to have been one of the last major legislative achievements of this session of Congress.
It would open 8.3 million acres of the Gulf that is now off limits to drilling and also steer hundreds of millions of dollars of federal royalty payments to four Gulf coast states — a windfall for Louisiana, which would get about half the money.
Republicans leaders gave no reason for the decision,
But an aide to a lawmaker strongly supporting the legislation said that a number of Republicans withdrew their support at the last minute and some Democrats also had signaled they would not support the measure.
The aide, who requested anonymity because another attempt is expected on the bill, said GOP leaders planned to revive the bill in a way that only a majority vote is required or attach it to another bill. GOP leaders had put the measure on an expedited schedule, requiring two-thirds approval.
"We have precious little time left," said Sen. Mary Landrieu (news, bio, voting record), D-La., in a statement, adding she remained hopeful the legislation can be taken up later this week.
"The House will revisit the offshore drilling legislation again at some point before the end of this week, though details on the mechanics of how the measure will be considered have yet to be decided," Kevin Madden, spokesman for House Majority Leader John Boehner, said in a statement.
The drilling bill is one of a string of measures House GOP leaders have readied for this week's "lame-duck" session under an expedited procedure that bars amendments, but also requires a two-thirds vote for approval.
Environmentalists have lined up against the bill and some Republicans are cool toward the measure, favoring a more expansive offshore energy development plan that passed the House in June that would have lifted drilling bans along both the East and West coasts. Senate leaders said the House bill had no chance in the Senate.
The Senate-passed bill covers an area 125 miles south of the Florida Panhandle and is up to 300 miles from Florida's Gulf coast. It is believed to contain 1.3 billion barrels of oil and 6 trillion cubic feet of natural gas, enough gas to heat 6 million homes for 15 years. The country uses about 21 million barrels of oil a day.
House leaders have been bombarded by calls from a wide range of business groups — from chemical companies to pulp and paper industries as well as electric utilities and manufacturers — for the House to accept the Senate-passed bill and send it to President Bush for his signature.
Business groups have argued that new offshore energy development might ease natural gas prices, which have dropped significantly this year but still are three times to four times higher than what they were only a few years ago.
"This vote is the last chance Congress can come through for the American public," said John Engler, president of the National Association of Manufacturers, urging the House to pass the Senate bill.
Industry groups had favored the broader House-passed bill, but see the Senate bill as the most that can be expected, and likely more than what can be gotten from the Democratic-controlled Congress next year.
"You take what you can get," said David Palmer, president of the American Gas Association, which represents gas utilities and — like agriculture and the chemical industry — has been struggling with high fuel costs.
But environmentalists argued the new Gulf drilling would increase the chance of environmental damage and have little impact on prices.
"Opening our national coastline to destructive drilling will only add to the billions in profits already being made by Big Oil, do nothing to lower gas prices for American families or energy costs for American businesses, and will keep our nation dangerously dependent on oil," said Athan Manuel of the Sierra Club.
Landrieu, D-La., who helped craft the Senate bill, said the revamped revenue sharing plan would produce huge environmental benefits to the Gulf Coast by providing money for wetland restoration, levee repairs, flood control and hurricane protection. The bill eventually would give states 37.5 percent of royalties from all Gulf oil and gas production, compared with about 2 percent now.
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Why relentless green drive may end up costing us the earth
JOHN STEWART
SPRING in Malaysia is even more silent than it was when I reported how the indigenous jungle is being destroyed to provide palm oil for the Soil Association's "environmentally-friendly" pesticide soft soap.
More great swathes of the eco-system are being replaced by oil palms to supply Europe with the biodiesel it must have by next year to comply with Directive 2003/30/EC requiring 5 per cent of road fuel to come from biological sources.
Both outcomes are typical results of green intervention in the market. They have not grasped that, to succeed, intervention must be complete and global - anything less merely creates a distortion used by shrewd businessmen to exploit the public purse, usually with further damage to the environment.
Locally, nationally or internationally, green policies are a dreary saga of intervention, unforeseen consequences and further intervention, with the environmental balance sheet always in the red.
A bit like the Red Queen, in the lexicon of green speak, words mean whatever they want them to mean so the temporary, short-term generation of landfill gas in rubbish dumps is deemed to be "sustainable" and electricity generated by burning it qualifies for Renewables Obligation subsidies, currently standing at about £48 per megawatt hour.
Curiously, nuclear - based on an estimated 4,000 years' supply of uranium - is not sustainable. This encouragement to create landfill sites conflicts with the EU directive requiring less rubbish to go to landfill and more to composting or incineration. But both these operations require extensive transporting of waste to central facilities.
Burning chicken dung to generate subsidised electricity and replacing it with artificial manure with a carbon price of 5.7 tonnes of per tonne of fertiliser is another dismal entry in the environmental ledger, but the ultimate in "double speak" - less is more - is reserved for hydroelectricity.
Prior to 2002, hydroelectric stations of over 20MW capacity were excluded from Renewables Obligation subsidies. However, on 1 April, a date that made many people wonder if it really was a prank, the government quietly announced that stations above that level could be deliberately reduced in capacity to qualify.
Generating companies, among them Scottish & Southern Energy, promptly decommissioned alternator windings by between 18 and 47 per cent to reduce hydro capacity by a total of 59MW, achieving their goal of less renewable electricity but more profits at the expense of the environment.
Overall, I reckon green policies in Scotland have considerably increased emissions and I'm not including the extra given off by peat disturbed during wind power station construction. Nothing convinces me that it is any different.
Taking a global outlook, the recommendation in the Stern report for international carbon trading will simply become another mechanism for taking money from poor Europeans and giving it to a very few, very wealthy Third World dictators who will sell their countries' carbon entitlement to line their own pockets. Carbon dioxide is the same whoever emits it and carbon trading will make no overall difference.
Already, national morale is wilting under the relentless green propaganda message that our lifestyle is "trashing the planet" and creating "climate chaos". It will take more than a few thousands spent on Glasgow's happiness centre to offset that and who in their right mind would chose to have children in a collapsing, chaotic world?
We will never achieve anything in response to climate change until we return to hard science, free-market economics, evidence-based policies and democratic accountability.
Web links
Scottish Parliament Renewable Energy Group
http://www.spreg.co.uk/index.asp
Scottish Renewables
http://www.scottishrenewables.com/home.asp
DTI - renewable energy
http://www.dti.gov.uk/energy/energy-sources/renewables/index.html
British Wind Energy Association
http://www.bwea.com/
Views of Scotland
http://www.viewsofscotland.org
Country Guardian
http://www.countryguardian.net/
Friends of the Earth Scotland
http://www.foe-scotland.org.uk/
TreeHugger.com
http://treehugger.com
Related topic
Alternative energy sources
http://news.scotsman.com/topics.cfm?tid=605
This article: http://news.scotsman.com/topics.cfm?tid=605&id=1656212006
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Today's NY Times
The Energy Challenge
The Cost of an Overheated Planet
By STEVE LOHR
Published: December 12, 2006
The iconic culprit in global warming is the coal-fired power plant. It burns the dirtiest, most carbon-laden of fuels, and its smokestacks belch millions of tons of carbon dioxide, the main global warming gas.
The Energy Challenge
Fossil Fuel Economics
Articles in this series are examining the ways in which the world is, and is not, moving toward a more energy efficient, environmentally benign future.
Chris Keane for The New York Times
James E. Rogers, chief executive of Duke Energy and chairman of a leading utility trade group, at an electrical substation in Charlotte, N.C.
So it is something of a surprise that James E. Rogers, chief executive of Duke Energy, a coal-burning utility in the Midwest and the Southeast, has emerged as an unexpected advocate of federal regulation that would for the first time impose a cost for emitting carbon dioxide. But he has his reasons.
“Climate change is real, and we clearly believe we are on a route to mandatory controls on carbon dioxide,” Mr. Rogers said. “And we need to start now because the longer we wait, the more difficult and expensive this is going to be.”
Global warming is not only an environmental hazard, but also a great challenge for economic policy. Without economic incentives, analysts say, the needed investments in industrial cleanup, innovative low-carbon technologies, fuel-efficient cars and other ways of reducing energy waste will not occur.
Mr. Rogers’s stance is far from universal within the power industry, but it has surprising support, particularly from those, like him, who also produce electricity from carbon-free nuclear reactors.
And despite the Bush administration’s adamant opposition to any limits on fossil fuel emissions, the idea is beginning to pick up momentum in the American political arena as well. Already, California has adopted a policy aimed at reducing the state’s contribution to global warming by 25 percent in the next 14 years.
In Washington, several influential lawmakers, including Senator John McCain, a leading Republican contender for president in 2008, have introduced legislation intended to limit the nation’s carbon dioxide output.
But how would those goals be achieved? Global warming can be seen as a classic “market failure,” and many economists, environmental experts and policy makers agree that the single largest cause of that failure is that in most of the world, there is no price placed on spewing carbon dioxide into the atmosphere.
Yet it is increasingly clear that there is a considerable cost to carbon dioxide emissions, especially to future generations, as climate specialists warn of declines in farm output in poor tropical countries, fiercer hurricanes and coastal floods that could make many people refugees.
Price List for Polluting
“Setting a real price on carbon emissions is the single most important policy step to take,” said Robert N. Stavins, director of the environmental economics program at Harvard University. “Pricing is the way you get both the short-term gains through efficiency and the longer-term gains from investments in research and switching to cleaner fuels.”
Some academics see an analogy between a global warming policy and the pursuit of national security in the cold war. In the late 1950s, American military spending reached as high as 10 percent of the gross domestic product and averaged about 4 percent, far higher than in any previous peacetime era. A Soviet nuclear attack was a danger but hardly a certainty, just as the predicted catastrophes from global warming are threats but not certainties.
“The issues are similar in that you pay now so things are less risky in the future — it’s an insurance policy,” said Richard Cooper, a Harvard economist. “And in the cold war, we taxed ourselves fairly highly to mitigate that threat.”
What makes such a view more than a conceptual argument is that executives like Mr. Rogers, who is also chairman of the Edison Electric Institute, a utility trade group whose members provide 60 percent of the nation’s electric power, are also pushing for a carbon dioxide-pricing policy to reduce the risk to their companies.
They say that only with some sort of federal policy in place — which would probably take the form of a tax on carbon dioxide waste from any source, or a “cap and trade” regulatory system — will it become clear what carbon cleanup or fuel-switching moves their companies may have to make, and on what sort of timetable.
Investors in alternative energy projects also emphasize the need to set policy priorities.
“We need a policy framework for the long term,” said Vinod Khosla, a leading environment-oriented venture capitalist. “Fifteen years is the minimum horizon of stability that we need.”
Beyond incentives for business, a national global warming policy should include increased federal spending on research on futuristic technologies to curb carbon emissions, advocates say.
Combating global warming, they say, will require over-the-horizon breakthroughs involving safe nuclear energy, hydrogen power and advanced carbon sequestration — or technologies that have not yet been imagined.
But even today, there are sizable opportunities, by insisting on more efficient energy use, that are not being seized, according to the McKinsey Global Institute. In a new report, the institute, a business-oriented research group that is part of McKinsey & Company consultants, estimated that the yearly growth in worldwide energy demand could be cut by more than half through 2020 — to an annual rate of 0.6 percent from a forecast 2.2 percent, using current technology alone.
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Available steps that would yield a more productive, and efficient, use of energy include compact fluorescent lighting, improved insulation on new buildings, reduced standby power requirements and an accelerated push for appliance-efficiency standards.
Carbon’s Possible Future All these moves, McKinsey said, would save money for consumers and businesses. “We were really surprised by these huge straightforward opportunities that are not being taken,” said Diana Farrell, the McKinsey Global Institute’s director. “In some senses, there is a big market failure.”
Energy efficiency can help slow the pace at which the risk from global warming risk increases, but it cannot reverse the trend alone. In the very long term, environmental experts say, the world’s economy needs a technological transformation, from deriving 90 percent of its energy from fossil fuels today to being largely free of emissions from fossil fuels by 2100, through cleanup steps or alternative energy sources.
Science and Uncertainty
Given all the uncertainties, the scientists and economists who design and run simulations of global warming policy acknowledge that their work is at best a tool for thinking about climate change issues.
Still, they tend to agree that over the next 50 years, the cost of slowing and eventually reversing carbon emissions growth will be 1 to 2 percent of global economic output. They assume the focus over those years will be mainly on efficiency and cleaning up electricity generation.
In later years, their cost projections become more varied, ranging from 1 percent to as high as 16 percent of global output, depending on assumptions about how difficult it will be to wean the world’s vehicle fleet from fossil fuels, and to make other technological leaps.
“Going past 2050, the cleverness really has to kick in,” said John M. Reilly, an economist at the M.I.T. Joint Program on the Science and Policy of Global Change.
A global warming policy would be shaped first by science and social values, before economics. A sensible goal, according to many environmental specialists, is to try to avert a doubling or more of atmospheric concentrations of carbon dioxide in this century.
“This is not something that goes on inside a computer, but a grand political calculation,” said Stephen H. Schneider, a climate expert at Stanford University.
Yet even in realms of social policy, where uncertainty is high, there is an implicit calculation of costs and benefits. In the case of global warming, the cost of society’s insurance policy may well be worth it, measured in the damage averted.
But it will not be cheap. Take the experts’ consensus estimate that curbing carbon dioxide emissions over the next 50 years will, on average, cost about 1 percent of global economic activity annually.
It seems a modest figure. Yet in today’s terms, 1 percent of the United States economy is more than $120 billion a year, or $400 a person.
Put another way, $120 billion is about equal to the Bush administration’s tax cuts in 2001; it is also roughly the amount spent on the Iraq and Afghanistan wars this year.
“There’s no easy way around the fact that if global warming is a serious risk, there will be serious costs,” said W. David Montgomery, an economist at Charles River Associates, a consulting group.
A price on carbon dioxide emissions, most economists agree, would be the most efficient way to combat global warming. And the price, they say, should start small to give industries time to adapt, then ratchet up over the years to encourage long-term investments in energy saving, carbon cleanup and new technology.
The two methods of pricing carbon are to charge a tax on each ton of carbon dioxide emitted into the air, or to place a cap on total emissions and then let polluters trade permits to emit a ton of carbon dioxide.
Economists like William D. Nordhaus of Yale and Mr. Cooper of Harvard advocate a tax as the clearest price signal to the energy marketplace, and less susceptible to political tampering and market manipulation than a cap-and-trade system. It could also be used to raise revenue to offset other taxes.
In a recent paper, Mr. Cooper suggested an initial tax around $14 a ton of carbon dioxide emitted, which he calculated would translate roughly into a 100 percent tax on coal and add 12 cents to each gallon of gasoline. Such a tax would raise as much as $80 billion a year in the United States.
“There’s nothing sacred about the number,” he said, “but you need to get a significant price into the system to create the incentive for people to go out and look for solutions.”
A Quota or a Tax?
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Economically, a cap-and-trade system has the same goal as a tax, putting a price on carbon dioxide emissions, but goes about it differently. A limit would be placed on overall emissions, with polluters allocated permits. Then, companies able to go below their emission targets would be allowed to sell their unused “permits to pollute” to companies that could not.
Carbon’s Possible Future A cap-and-trade system also has some political advantages. It can deflect the anger over higher costs and enable governments to use their allocations to essentially buy political support, since permits are the equivalent of cash. Big polluters, who will have to invest most to clean up, could be granted extra allowances in the early years of the program to subsidize their investments.
In the United States, caps and trading have a record of success in combating acid rain, which is caused by sulfur dioxide emissions from fossil fuel power plants.
“People said it was a crazy idea, too complicated and too regulatory,” said Richard L. Schmalensee, an M.I.T. economist who was an economic adviser to the first President Bush when the sulfur emissions program was designed. “But the lesson learned was that a cap-and-trade system can work.”
The global warming legislative proposals before Congress — including one sponsored by Senator McCain and Senator Joseph I. Lieberman of Connecticut, and another by Senator Jeff Bingaman of New Mexico — envision cap-and-trade systems.
But the challenge of controlling carbon emissions is far greater than sulfur. Carbon dioxide is a pervasive byproduct of the economy, and the polluters are many and varied. Once emitted, carbon dioxide is vexingly long-lived in the environment.
The early struggles of the European Union’s carbon emission trading system, set up last year, point to the administrative and political difficulties. The European governments, responding to lobbying by domestic businesses, handed out permits that exceeded the emissions that most companies were already putting into the air. When that became clear in April, the market price of carbon dioxide emissions fell by half.
Senator Barbara Boxer of California, who will soon take the chair of the Senate environment committee, has pledged to push Congress to impose a price on carbon dioxide emissions, as the Europeans have done.
Yet without coordinated international action, even if the United States — the largest source of carbon emissions — reined them in, this would have only limited effect on global warming. China is on track to surpass the United States as the leading emitter of carbon dioxide by 2009, according to a recent report by the International Energy Agency.
“Unless China and India are brought in, it won’t matter much what the developed world does,” said Scott Barrett, a professor of environmental economics at the School of Advanced International Studies of Johns Hopkins University.
But developing nations like China and India, energy specialists say, would certainly avoid joining any international effort on global warming without an emphatic move by the United States.
“Every year we delay, we contribute to another year of delay in China, India and elsewhere,” said Jason S. Grumet, executive director of the National Commission on Energy Policy, a bipartisan group of energy experts. “The ecological and economic imperative is to start now.”
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A green Republican organization recommended by my friend John Spezzano.
http://www.rep.org:80/
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http://article.nationalreview.com/?q=OTdhNDFkODBjY2Y2M2I1MGFlZTY3NTM0ZjkyNDAwZGM=
Oil Hydra
Is there an easy way out of the mess we've gotten ourselves into?
By Victor Davis Hanson
Oil is nearly $100 a barrel. Gas may soon reach $4 a gallon. And Americans are being bitten in almost every way imaginable by this insidious oil hydra.
Two billion people in China and India are now eager consumers. They want the cars, gadgets, and lifestyle that Westerners have claimed as a birthright for a half-century. Their growing energy appetites mean that the international petroleum market may remain tight, even if Americans — who use almost twice as much oil per day as China and India put together — cut back on imported energy.
The Middle East is raking in billions each week. At best, our so-called friends in cash-laden Saudi Arabia subsidize fundamentalist mosques and hate-filled madrassas worldwide. At worst, our enemies in petrol-rich Iran are after the bomb, send weapons into Iraq to kill Americans and fund Hezbollah jihadists.
War in Iraq, rumors of fighting in the near-future in Iran and tension on the West Bank only panic markets, raise oil prices and further enrich our grinning enemies.
The nearly half-trillion dollars we will soon pay for imported oil does a lot more than prop up Russia's Vladimir Putin, Venezuela's Hugo Chavez and Iran's Mahmoud Ahmadinejad. The petrodollar drain also contributes to our trade deficits, falling dollar and a general demoralization of the American people.
Our oil habit not only makes us dependent on some creepy suppliers, but we look like fools as we work nonstop to hand over our earnings to those who are rich by an accident of sitting atop oil someone else found and developed.
There is talk in this country of a gradual transition to alternative fuels, solar power, wind machines, plug-in electric cars, and nuclear power. Supposedly Americans will soon be less dependent on imported oil — while helping to slow global warming — as we are weaned off our fossil-fuel addiction.
But let's talk about the present: If oil continues to climb, ultimately, it will change our very way of life. Hard-pressed families will shell out thousands more a year in direct transportation and heating and cooling costs, and more still as consumer prices inflate.
It may have always been unwise for commuters to buy large SUVs and V8 supercab trucks. Now, though, we may reach the point where these pricey huge vehicles will sputter to a halt. Indebted Americans will still shell out monthly payments to pay off their parked dinosaurs, only to drive them for emergency or ceremonial occasions.
Also expect rising popular anger at an asleep-at-the-wheel government that for the last 20 years should have been doing a lot more to mandate conservation, subsidize alternate fuels, encourage nuclear power and open up oil fields offshore and in Alaska.
Instead, doctrinaire free-market purists and radical environmentalists, hand in glove, for years have thwarted both conservation and exploration.
True, in a perfect world, the market would teach Detroit not to build gas-hungry big cars. Yet in the here and now, we are needlessly burning scarce fuel as too many 7,000-pound mammoths deliver single 180-pound drivers to work — while the auto industry continues on its path to irrelevance.
Meanwhile, green politicians may not want messy oilrigs off their coasts, or tankers up north among the ice and polar bears. But so far very few of them have sworn off jet travel, nice cars or ample homes.
Oil companies claim that they are only passing along escalating costs from overseas suppliers over which they have no control. But around a third of our oil is pumped here at home.
Think about it: The cost to extract oil from existing older wells is relatively fixed. For much of the 1990s and early 2000s, oil prices had been steady at between $20 and $30 a barrel (when adjusted for inflation) — and domestic oil companies did quite well. So now at near $100 a barrel, these corporations are raking additional profits of over $60 a barrel — potentially a domestic windfall of hundreds of billions of dollars each year.
Is there an easy way out of the mess we've gotten ourselves into?
Maybe a Silicon Valley genius inventor or entrepreneur will step forward with a breakthrough new energy source.
Maybe our government will start a crash project on the scale of the Manhattan Project to conserve and produce more fuels.
Maybe China and India will consider radical conservation measures.
Maybe countries like Iraq, Libya, and Russia will start reinvesting in their oil infrastructures and double production.
Maybe the Middle East will finally settle down and soothe jittery oil speculators.
Those are too many maybes to wait for while our way of life hangs in the balance. It is past time to demand from our presidential candidates, as well as the current government, exactly when and how they plan to slay this many-headed oil monster.
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Nuclear Winter
By BRUNO BRUNETTI
November 22, 2007
Nuclear energy emerged as a clear answer to the oil shocks of the 1970s, growing from near-irrelevance early in that decade to supply almost one-third of Western European power needs by 1990. Today, as oil prices continue their unrelenting ascent and concerns mount over climate change, some argue that Europe needs a nuclear renaissance. But this time, things are slightly different.
At the moment, 32 nuclear power plants are under construction around the globe, totaling roughly 27 electrical gigawatts. Europe is home to only three of these plants, or 13% of the capacity, with one reactor in Finland and two in Bulgaria. Europe is lagging behind other regions because new nuclear stations face not only the obvious political obstacles but commercial ones as well, despite the current high price of power.
A primary commercial issue is the significant slowdown in electricity demand growth. In the 1970s and '80s, annual demand growth for power averaged 3.2% and 2.6%, respectively. Power demand has been growing by a much more modest 1.6% this decade. Higher energy prices are encouraging large power users to implement efficiency measures or even relocate industrial plants outside of Europe. Power demand growth may move below 1% a year in the next decade. In this environment even existing plants are threatened, though policy makers are raising serious questions about earlier decisions to retire nuclear power plants in Germany and elsewhere across Europe.
What's more, renewable energy sources -- particularly wind, small hydro plants and biomass -- have been growing quickly in the past few years, thanks in part to EU energy policy. Europe is close to meeting its target of using renewables to produce 21% of its electricity generation by 2010. According to the EU's "Renewable Energy Road Map," published in January 2007, Europe will probably reach 19% by 2010, and Brussels is evidently quite serious about full compliance. The European Commission has begun infringement proceedings against six member states for not fulfilling their renewable-energy obligations. A second push toward renewables comes from an ambitious, binding target of 20% for all EU energy needs by 2020. Besides electricity, we should expect renewable sources to increasingly cover other needs, such as heating for homes.
As electricity demand continues to slow down, the use of conventional sources -- oil, natural gas and coal -- should stabilize or even decline versus current levels. Rather than working to meet increasing energy needs, as in the '70s and '80s, the challenge is to replace existing and aging oil-, gas- or coal-fired power plants more efficiently. The need to replace this existing capacity will be more acute toward the end of the next decade, so the incentive to build new nuclear stations appears less pressing for the moment. Nevertheless, these plants take a long time to be built, so planning is critical. In Finland, the construction process is taking six years, rather than the four years first planned, obliging the world's leading nuclear constructor Areva to make significant financial provisions to cover the higher-than-expected costs.
Another obstacle for nuclear is structural. The electricity industry in the '70s and '80s was typically organized around vertically integrated monopolies, primarily responsible for the long-term planning, building and operation of power stations. There is no doubt that the development of large-scale and highly capital-intensive projects benefited from this market structure, as there was little market uncertainty under such a controlled system. The liberalization process -- started in the late 1980s in the U.K. and extended to the entire EU in the late 1990s -- introduced significant regulatory uncertainties and made high-cost investment decisions riskier for privately owned energy companies.
There are of course a myriad of other issues surrounding nuclear energy, including the safe transport, disposal or storage of nuclear waste, as well as the risks posed by the threat of a terrorist attack. But the commercial challenges alone mean that nuclear energy appears to have a dimmer future.
Mr. Brunetti is senior director for European electricity at PIRA Energy Group.
WSJ
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http://hotair.com/archives/2008/03/11/mullahs-or-mounties-which-do-we-prefer/
Good thinking, dems.
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Energy independence — it has become the buzzword for the 2008 presidential election. We want to move away from Middle East oil, at the very least, in order to keep from being held as economic hostages by hostile governments in the region. We can avoid that by increasing importation from Canada, whose tar sands in Alberta have deep reserves that our friends would like to sell to us. Problem solved, right?
Wrong:
Quick — what country has the world’s largest oil reserves? Saudi Arabia? Iran? Nigeria? Venezuela? Wrong on all counts. The answer is Canada. And our neighbor to the north is worried we don’t want it.
Canada has an estimated 1.6 trillion barrels of oil on its territory, much of it locked in tough-to-excavate tar sands in the province of Alberta. By comparison, oil-rich Saudi Arabia has an estimated 270 billion barrels left. It isn’t even close.
Yet, according to the Financial Times of London, Canada’s government recently sent U.S. Defense Secretary Robert Gates a letter of warning that it might not be able to sell the U.S. any of its oil, which the Pentagon desperately needs for national defense.
For that, you can thank the Energy Independence and Security Act of 2007, passed with great gusto and self-righteousness by the Democratic Congress.
The bill classified oil from tar sands as an alternative fuel, which places restrictions on its use. Unlike regular crude, the US government cannot buy alternative fuels unless they release less greenhouse gas. The tar-sands crude unfortunately doesn’t qualify, and it’s not even close; it produces much more of those emissions than regular crude.
The Canadians, needless to say, are nonplussed over this action by Congressional Democrats. They want to sell us the crude, and our armed services could certainly use a reliable source of energy not dependent on mullahcracies and kleptocracies. However, even though we already have reliable and friendly trade with Canada on oil for commercial purposes from these tar sands, the US military will take a pass and stick with the Nigerians, Venezuelans, and Saudis.
Does that make any sense at all?
Canada will find buyers for its Alberta tar-sands product. American energy companies have already signed up for sales and development, of course, but that’s not where the big sales will go. The Chinese, who are much less picky about where they get the energy supplies for its military, will almost certainly leap at the chance to get in line ahead of the US for the product.
It’s precisely this lack of strategic long-term thinking that makes people nervous about putting Democratic leadership in Congress together with Barack Obama or Hillary Clinton in the White House. Congress needs to revisit these restrictions ASAP.
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The Biofuels Backlash
May 7, 2008; Page A18
St. Jude is the patron saint of lost causes, and for 30 years we invoked his name as we opposed ethanol subsidies. So imagine our great, pleasant surprise to see that the world is suddenly awakening to the folly of subsidized biofuels.
All it took was a mere global "food crisis." Last week chief economist Joseph Glauber of the USDA, which has been among Big Ethanol's best friends in Washington, blamed biofuels for increasing prices on corn and soybeans. Mr. Glauber also predicted that corn prices will continue their historic rise because of demand from "expanding use for ethanol."
Even the environmental left, which pushed ethanol for decades as an alternative to gasoline, is coming clean. Lester Brown, one of the original eco-Apostles, wrote in the Washington Post that "it is impossible to avoid the conclusion that food-to-fuel mandates have failed." We knew for sure the tide had turned when Time magazine's recent cover story, "The Clean Energy Myth," described how turning crops into fuel increases both food prices and atmospheric CO2. No one captures elite green wisdom better than Time's Manhattan editors. Can Vanity Fair be far behind?
All we can say is, welcome aboard. Corn ethanol can now join the scare over silicone breast implants and the pesticide Alar as among the greatest scams of the age. But before we move on to the next green miracle cure, it's worth recounting how much damage this ethanol political machine is doing.
To create just one gallon of fuel, ethanol slurps up 1,700 gallons of water, according to Cornell's David Pimentel, and 51 cents of tax credits. And it still can't compete against oil without a protective 54-cents-per-gallon tariff on imports and a federal mandate that forces it into our gas tanks. The record 30 million acres the U.S. will devote to ethanol production this year will consume almost a third of America's corn crop while yielding fuel amounting to less than 3% of petroleum consumption.
In December the Congressional Research Service warned that even devoting every last ear of American-grown corn to ethanol would not create enough "renewable fuel" to meet federal mandates. According to a 2007 OECD report, fossil-fuel production is up to 10,000 times as efficient as biofuel, measured by energy produced per unit of land.
Now scientists are showing that ethanol will exacerbate greenhouse gas emissions. A February report in the journal Science found that "corn-based ethanol, instead of producing a 20% savings, nearly doubles greenhouse emissions over 30 years . . . Biofuels from switchgrass, if grown on U.S. corn lands, increase emissions by 50%." Princeton's Timothy Searchinger and colleagues at Iowa State, of all places, found that markets for biofuel encourage farmers to level forests and convert wilderness into cropland. This is to replace the land diverted from food to fuel.
As usual, Congress is the last to know, but maybe even it is catching on. Credit goes to John McCain, the first presidential candidate in recent memory who has refused to bow before King Ethanol. Onetime ethanol opponent Hillary Clinton announced her support in 2006, as the Iowa caucuses beckoned. In 2006 Barack Obama proposed mandating a staggering 65 billion gallons a year of alternative fuel by 2025, but by this Sunday on NBC's "Meet the Press" he was suggesting that maybe helping "people get something to eat" was a higher priority than biofuels.
Mr. McCain and 24 other Senators are now urging EPA Administrator Stephen Johnson to consider using his broad waiver authority to eliminate looming biofuel mandates. Otherwise, the law will force us to consume roughly four times the current requirement by 2022. In fact, with some concerned state governments submitting helpful petitions, Mr. Johnson could largely knock out the ethanol mandate regime, at least temporarily.
Over the longer term, however, this shouldn't be entrusted to unelected bureaucrats. The best policy would repeal the biofuel mandates and subsidies enacted in the 2005 and 2007 energy bills. We say repeal because there will be intense lobbying to keep the subsidies, or transfer them from projects that have failed to those that have not yet failed.
Like Suzanne Somers in "American Graffiti," the perfect biofuel is always just out of reach, only a few more billion dollars in subsidies away from commercial viability. But sometimes even massive government aid can't turn science projects into products. The industry's hope continues for cellulosic ethanol, but there's no getting around the fact that biofuels require vegetation to make fuel. Even cellulosic ethanol, while more efficient than corn, will require countless acres of fuel if it is ever going to replace oil. Perhaps some future technology will efficiently extract energy from useless corn stalks and fallen trees. But until that day, Congress's ethanol subsidies are merely force-feeding an industry that is doing far more harm than good.
The results include distorted investment decisions, higher carbon emissions, higher food prices for Americans, and an emerging humanitarian crisis in the developing world. The last thing the poor of Africa and the taxpayers of America need is another scheme to conjure gasoline out of corn and tax credits.
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Do other people besides me think it obscene that ourp politicans go out into the private sector and turn around to make millions off their having done "public service". Like the Clintons giving speeches for hundreds of thousands a pop, getting their daughter a hedge fund job, John Edwards ties to a hedge fund, the Bushes getting millions as early investors of Global Doublecrossing, presidential libraries being used by the Clintons to funnel themselves more money and on and on.
I think they should all be taxed a 100% windfall profits tax! Isn't that what all this crap is anyway? They are cashing in on their connections made while *serving* the citizens of our country in *public* service?
The hypocrisy is just soooo tiring. From Jonah Goldberg on the hot air windfall profits tax on oil coming out of Washington DC the other place in the US where prostitution is legal.
May 9, 2008 4:00 AM
Take That, Big Oil!
The windfall profits tax slap.
By Jonah Goldberg
Imagine this. You’ve built the better mousetrap. (Because lasers and pneumatic tubes are cool, let’s imagine it uses them.) You’ve persevered through years of trial and error in your garage, enduring sleepless nights, the mockery of friends, the eye-rolling of family, and the non-lethal laser wounds to the family cat. But it was all worth it. You take your invention and, with your last few pennies, manage to bring it to market. It’s a smash hit. It starts flying off shelves. You earn back the investment in raw materials and maybe something close to compensation for your time. Now you’re ready for the big payoff. There’s just one thing left to do: make an appointment with the regional Reasonable Profits Board to find out how much of your windfall is reasonable for you to keep.
Picked by Congress nominally for their expertise in analyzing the mousetrap industry but actually for their vampiric lust for entrepreneurial blood, members of the Reasonable Profits Board will determine how much of your already-taxed profits cross the “rational threshold.”
Now that’s the American dream!
What this would mean for Mousetrap 2.0 may not be a big concern for members of the board, but odds are you’ll start to feel like you’re working for them.
Replace “Mousetrap” with “oil,” and you have a good idea of how some in Congress want to bring the oil industry to heel. Rep. Paul Kanjorski, D-Pa, is offering his “Consumer Reasonable Energy Price Protection Act,” which would make oil companies supplicants of a Reasonable Profits Board. Senate Democrats, led by Chuck Schumer and Harry Reid, proposed their 25 percent windfall profits tax this week, while Rep. Dennis Kucinich, D-Alpha Centauri, has been calling for a 100 percent windfall profits tax rate for some time. Hillary Clinton is barnstorming the country talking about a windfall profits tax that will not only stick it to the corporate fat cats but will “pay” for a gas tax holiday.
“Windfall,” of course, is just another word for “undeserved,” which is why windfall profits are defined as the profits earned by someone other than you. If we were honest with the people having their profits yanked away, we’d call it the “well-earned and richly deserved profits tax.”
Now hold on a second, cry the unreasonable-profit confiscators. That analogy is bogus. ExxonMobil isn’t some garage-workshop Horatio Alger. ExxonMobil is a cold and impersonal multinational corporation!
To which I say: Exactly!
So why are Democrats keen on treating oil companies like they’re comic-book villains and the windfall profits tax is just a well-deserved enema that will teach Big Oil to pay its fair share?
In 1977, when Jimmy Carter proposed the first windfall profits tax, he said through those enormous teeth, we “will ask private companies to sacrifice just as private citizens do.” But corporations aren’t normal citizens.
If you tell oil companies that they won’t be able to keep their profits past a certain point, you know what they’ll do? They’ll make money right up until that point and then they’ll stop. Unlike the guy building the better mousetrap, oil companies aren’t in it for the glory, they’re in it for the money. No oilman will go home hungry and wake up like Scrooge on Christmas morning, having repented because of a windfall profits tax.
Now, there will be plenty of punishment doled out, more than at a Belgian S&M club during recess at the European Parliament. But the crack of the windfall whip will land in unintended places. “Corporate sacrifice” means sacrificing share value, jobs and, most of all, reinvestment.
So people dependent on pension funds — union workers, government employees and the like — will be asked to sacrifice some of their retirement income. Jobs dependent on oil and gas extraction would be cut. And, as Schumer explains, money that would otherwise be invested in exploration and improved efficiency will instead be diverted to “alternative” energies that politicians (like Schumer) think are better investments.
No wonder Schumer’s so cocky, given the boffo success of Washington’s “investment” in ethanol, which creates more greenhouse gases than oil does, contributes to deforestation, and is fueling the starvation of millions around the globe.
Meanwhile, less investment in exploration and efficiency will cause pump prices to rise (less supply = higher prices) and, as in the 1980s, cause us to rely on more foreign oil.
But, by all means, let’s do it, because Big Oil is bad and someone — or everyone — has to pay for it.
Now hold on a second, cry the unreasonable-profit confiscators. That analogy is bogus. ExxonMobil isn’t some garage-workshop Horatio Alger. ExxonMobil is a cold and impersonal multinational corporation!
To which I say: Exactly!
So why are Democrats keen on treating oil companies like they’re comic-book villains and the windfall profits tax is just a well-deserved enema that will teach Big Oil to pay its fair share?
In 1977, when Jimmy Carter proposed the first windfall profits tax, he said through those enormous teeth, we “will ask private companies to sacrifice just as private citizens do.” But corporations aren’t normal citizens.
If you tell oil companies that they won’t be able to keep their profits past a certain point, you know what they’ll do? They’ll make money right up until that point and then they’ll stop. Unlike the guy building the better mousetrap, oil companies aren’t in it for the glory, they’re in it for the money. No oilman will go home hungry and wake up like Scrooge on Christmas morning, having repented because of a windfall profits tax.
Now, there will be plenty of punishment doled out, more than at a Belgian S&M club during recess at the European Parliament. But the crack of the windfall whip will land in unintended places. “Corporate sacrifice” means sacrificing share value, jobs and, most of all, reinvestment.
So people dependent on pension funds — union workers, government employees and the like — will be asked to sacrifice some of their retirement income. Jobs dependent on oil and gas extraction would be cut. And, as Schumer explains, money that would otherwise be invested in exploration and improved efficiency will instead be diverted to “alternative” energies that politicians (like Schumer) think are better investments.
No wonder Schumer’s so cocky, given the boffo success of Washington’s “investment” in ethanol, which creates more greenhouse gases than oil does, contributes to deforestation, and is fueling the starvation of millions around the globe.
Meanwhile, less investment in exploration and efficiency will cause pump prices to rise (less supply = higher prices) and, as in the 1980s, cause us to rely on more foreign oil.
But, by all means, let’s do it, because Big Oil is bad and someone — or everyone — has to pay for it.
— Jonah Goldberg is the author of Liberal Fascism: The Secret History of the American Left from Mussolini to the Politics of Meaning.
(C) 2008 Tribune Media Services, Inc.
© National Review Online 2008. All Rights Reserved.
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Oil Is Up Because the Dollar Is Down
By DAVID T. KING
May 23, 2008
Back in December 2002, one dollar equaled one euro. But that exchange rate didn't last. The dollar was on its way down, a trend that had started more than a year earlier, and has lasted, with occasional oscillations, to this day.
On the day in 2002 that the value of a dollar was exactly the same as the value of a euro, the price of a barrel of oil was, therefore, the same in dollars and euros: about 25. Since that day, it's like the two currencies have traded on two different planets.
Certainly energy prices have risen, regardless of what currency you use. In Europe, the price of oil has risen by 50 euros in the past five-and-a-half years. It now stands at about 75 euros per barrel, three times what it was then. But in the U.S., the price of oil has risen to over $120 per barrel, and is now almost five times what it was then.
The sole reason for this enormous difference is the incredible depreciation of the dollar against the euro. From one for one at the end of 2002, it now costs nearly $1.60 to buy a euro.
The chorus of complaints about the price of gasoline gets louder every day, and is even becoming a campaign controversy both across and within parties. The same old solutions we have heard for years are being proposed – conservation, increased domestic exploration, manipulations of the tax on gasoline. But no one is pointing to what is by far the biggest reason for today's $60 fill-ups. The collapse of the dollar exchange rate, alone, explains at least half of the increase in the pump price of gas over the past five years. If it wasn't for the falling value of the dollar, the price of gasoline wouldn't be an issue.
Maybe the reason nobody talks about it is because they don't think you can do anything about it, or that it's somehow too esoteric to talk about exchange rates. But, economically speaking, what is more fundamental to us than the value of our currency? Why have we allowed the value of a dollar to fall by half?
The conventional wisdom, followed by U.S. administrations for the past 30 years, is that "the market" knows what it's doing in setting these rates, based on "the fundamentals" of the economy. This is, by the way, more or less the same market – the same band of traders, both on and off Wall Street – who, based on some view of the fundamentals, valued Bear Stearns at $100 a share one year ago. As the prevailing view of its fundamentals rapidly shifted, Bear's stock value collapsed, but it hurt only Bear's stockholders. The collapse of the dollar hurts everyone – a lot.
The fact is that the dollar exchange rate is way out of line with the fundamental strength of our economy, and even with such well-known fundamentals as relative inflation rates.
But when it stays out of line for too long, it starts to feed back on the fundamentals themselves. The dollar has been so weak for so long that it's now causing inflation even at a time of recession. It's to blame for the excessive price of gasoline, and now is pushing dangerously into wholesale price inflation, based on the most recent data published by the Labor Department.
Will the market, accommodated by hands-off policy makers, now say that we need more depreciation to offset the inflation that depreciation itself has created?
We don't need gas tax holidays. Exchange rates can be managed. We need exchange rate policy.
Mr. King, a former chief of the New York Federal Reserve's Industrial Economies Division, is a managing consultant for Emerging Markets Group Ltd., in Arlington, Va
WSJ
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Second post of day
Oil and the Fed
May 23, 2008
So the Federal Reserve is signaling that its rate-cutting binge may finally be over, and we can be grateful for that small favor. The consequences of its easy-money bender will roll through the economy for years to come, however, so it's important to draw the right lessons.
All the more so because the Fed's most senior officials continue to insist that recent price increases have almost nothing to do with . . . monetary policy. Imagine that. The latest to wash his hands of responsibility for the value of the currency is Donald Kohn, the Fed's current Vice Chairman and long-time resident intellectual. In a speech in New Orleans this week, Mr. Kohn acknowledged soaring oil and food prices, but he blamed them on global supply and demand for corn, oil and so on.
"As interest rates in the United States fell relative to those abroad, the dollar declined, which could have boosted the prices of commodities commonly priced in dollars by reducing their cost in terms of other currencies," Mr. Kohn explained. "But the prices of commodities have risen substantially in terms of all currencies, not just the dollar. In sum, lower interest rates and the reduced foreign exchange value of the dollar may have played a role in the rise in the prices of oil and other commodities, but it probably has been a small one."
If Mr. Kohn really believes this, we're in more trouble than we thought.
For starters, he is simply wrong about the relative price of commodities and other currencies. The price of oil has risen far more rapidly in dollars than it has in euros since 2002. David King points this out today with a chart that we have run in the past. Had the Fed merely kept the dollar stable against the euro, the price of oil would be closer to $80 than to $131 a barrel.
No one denies that supply and demand play a role in commodity prices, but oil on global markets is denominated in dollars. When the value of the greenback falls, and especially when speculators anticipate that it will fall further, oil sellers demand more dollars for their product. This was the experience of the 1970s, the last time the Fed lost its monetary moorings, and we have been living through a sequel this decade.
As recently as last August, the dollar price of oil was only $70. The current spike in oil and other commodity prices coincides almost exactly with the Fed's decision to turn the monetary spigots wide open as a response to the credit crunch. They have since taken the fed funds rate down to 2% from 5.25%, while commodity prices have soared.
Oil prices have jumped recently on reports of higher global demand, but this too reveals a Fed miscalculation. The central bankers have justified their rapid plunge down the yield curve as necessary to avoid a recession, arguing that a slowing economy would mitigate any inflationary impact. Yet the economy has been far more resilient than either the Fed or its Wall Street beseechers expected, and we may still avoid a single negative quarter for gross domestic product this year.
As for inflation, this week's producer price numbers were alarming. The wholesale inflation figure is up 6.5% in the last year, despite an anomalous April decline in gasoline prices. That decline won't continue with $131 oil. With even the Fed's phony "core inflation" rate well above the 2% fed funds rate, Mr. Kohn and company are running a negative real interest rate policy.
No wonder inflation expectations have been rising. Economist Michael Darda points out that the University of Michigan's year-ahead inflation survey hit 5.2% in May, the highest reading since 1982. Yet some at the Fed continue to insist that inflation expectations are "well-anchored." Anchored on what planet?
The price for this Fed blunder is going to be very high, and we don't mean only at the grocery store or gas station. If inflation doesn't fall, the Fed will have no choice but to start raising rates again, perhaps rapidly and perhaps soon. That could put a damper on any economic recovery, especially if it coincides with the huge tax increase that Barack Obama is promising next year.
Politically, meanwhile, the Fed's commodity spike is proving to be deadly for the Republican Party that occupies the White House. As the nearby poll question shows, rising prices overall and gas prices specifically are by far the public's biggest economic worries. Voters are understandably furious because they can see that their real incomes are falling as prices rise. This is the real source of middle-class economic anxiety – not the housing recession, or jobs, or the liberal obsession with income inequality.
Republicans may be punished this November for forgetting that the Reagan policy mix had two levers – tax cuts and stable money. The Bush Administration got tax policy right. Its tragic error was falling for the siren song of dollar depreciation, and abetting a Federal Reserve that even now seems not to comprehend the damage it has done.
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Here's a terrific link that discusses the ramifications of no-nothing politicians upbraiding oil executives: http://www.coyoteblog.com/coyote_blog/2008/05/the-oil-reality.html.
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U.S.: A Record-Setting Change in Driving Habits
Stratfor Today » May 23, 2008 | 2136 GMT
David McNew/Getty Images
Morning rush-hour traffic moves along a freeway in Riverside, Calif.Summary
The number of miles driven by Americans dropped 4.3 percent year-on-year in March, according to the U.S. Department of Transportation. The decline — the sharpest ever — represents a behavioral change that is a necessary precursor to a shift in the markets.
Analysis
Car-loving Americans drove 11 billion fewer miles in March than they did a year earlier, the U.S. Department of Transportation reported May 23. The 4.3 percent decline is the first year-on-year decline since the 1979 oil shock, and the sharpest decline ever.
While Americans typically think of themselves as pressed for funds, in fact they have the most disposable income per capita of any of the major developed states. Adjusted for inflation, the average American’s disposable income has increased by more than $10,000 since the 1979 oil shock as estimated by the Bureau for Economic Analysis. There are more than 300 million Americans, and the sheer size of their collective purchasing power is simply mammoth.
Thus, Americans can rather painlessly absorb nearly any price increase for basic goods. But apparently there is a level at which they begin to adjust their behavior. Oil prices are now above $130 a barrel, twice what they were a year ago, and gasoline prices averaged $3.79 this week. Whether the decline in miles driven is happening because of high oil prices or slower economic growth — or more likely a combination of the two — is irrelevant.
The point is that it is happening and that will have results. The current economic situation is changing driving and spending habits on a long-term basis. For example, wretched sales of trucks and sport utility vehicles have a counterpoint in phenomenal sales of hybrid vehicles. These shifts to a more energy-efficient lifestyle are factors that will shape oil demand for a decade, and permanently reduce the demand of a culture that has traditionally been the oil producers’ best customer.
This is not to say that the May 23 statistical release will become known as the turning point in the market, but never forget that the United States uses more oil in absolute and per capita terms than any other country in the world. Without a shift in American behavior, it is difficult to see how the markets could ever undergo a fundamental drop. With that shift, it is difficult to see how — given time — they cannot.
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I found this video pretty disturbing. My dad sent it to me and told me that once he started watching, he didn't intend to watch it all the way through however couldn't stop watching and I had the same experience. It's a long video however Lindsey Williams (the guy giving the lecture) has VERY specific knowledge and doesn't hesitate to name the names of those who are controlling the world in his opinion. He gave this lecture in October 2007 and said that oil prices would be $4-$5 per gallon in the very near future (we're there now) and said it wouldn't be long before it is $6-$7.
A few highlights off the top of my head are.....
1. The oil companies do make profits however it's not near as much as the middle men that we never hear about being the IMF and the World Bank.
2. One of the if not the largest oil fields in the world is in Gull Island, Alaska and would supposedly last us 200 years however we cannot dig there for many of the following reasons.
3. Oil is the world currency and controls almost everything we do.
4. Back in the 1960s or early 1970s, then Secretary of State Henry Kissinger went to the middle eastern countries to negotiate a deal with them to sell us their oil and in return, they must denominate all oil sales on US Dollar currency. Another part of the deal was that they had to take a portion of the oil revenues and buy our national debt. The Saudi's agreed however Iran and Iraq did not.
5. Iraq supposedly had plans to start denominating oil in foreign currency and had to be taken care of. He named the name of a guy who was sent into Iraq to tell their leaders that if they invaded Kwuait that we would not intervene. This was supposedly a set up. When we didn't finish the job the first time around, we had to go back.
6. Iran is now a major threat to us because they are already denominating their oil in Euros and Yen. China has already negotiated millions upon millions of barrels of oil contracts in Yen currency.
7. Iran supposedly has a plan to flood the world with cheap oil which could have a devastating effect on our economy and the value of our dollar. You can google Petrodollar warfare and read a lot about it.
Very interesting in my opinion and a worthwhile video to watch. This guy served as a Chaplain on the Alaska pipeline and said he worked side by side and counseled with many of those who are in control of the world in many ways. He seems very credible. I normally don't post information like this however thought it was worthwhile.
http://video.google.com/videoplay?docid=-8668319287834598272&q=&hl=en
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My tin foil hat alarm is going off, however I'll watch the video before rendering a more firm opinion.
How would the IMF and World Bank act as middle men in the global oil trade?
"2. One of the if not the largest oil fields in the world is in Gull Island, Alaska and would supposedly last us 200 years however we cannot dig there for many of the following reasons."** What reasons?**
"4. Back in the 1960s or early 1970s, then Secretary of State Henry Kissinger went to the middle eastern countries to negotiate a deal with them to sell us their oil and in return, they must denominate all oil sales on US Dollar currency. Another part of the deal was that they had to take a portion of the oil revenues and buy our national debt. The Saudi's agreed however Iran and Iraq did not."
**Kissinger was Sec. of State from from 1969-1975. At that time, the Shah was very much a client of ours until the 1979 Islamic revolution. Iraq was ruled by the Baath party, but Saddam didn't rise to power until 1979. To the best of my knowledge, the Saudis have been selling oil for the US dollar since at least the end of WWII. Those historical timelines don't seem to mesh with the conspiracy claims asserted.**
"5. Iraq supposedly had plans to start denominating oil in foreign currency and had to be taken care of. He named the name of a guy who was sent into Iraq to tell their leaders that if they invaded Kwuait that we would not intervene. This was supposedly a set up. When we didn't finish the job the first time around, we had to go back."
** If this was indeed a set up, then why leave Saddam in power? That would be pretty stupid to set up a war and then not bother to get the payoff from it.**
6. Iran is now a major threat to us because they are already denominating their oil in Euros and Yen. China has already negotiated millions upon millions of barrels of oil contracts in Yen currency.
**China's currency is the Yuan or Renminbi, although i'm sure the PRC has Yen holdings, I doubt they would trade oil for Japan's Yen, given the Chinese-Japanese hostility today. Iran supplies about 5% of the world's oil supply, so they aren't exactly a major player. Oil is fungible, so not matter whom you buy from, you pay the market price.**
7. Iran supposedly has a plan to flood the world with cheap oil which could have a devastating effect on our economy and the value of our dollar. You can google Petrodollar warfare and read a lot about it.
**Cheap oil would help our economy, not hurt it. Iran has flooded the world with high grade counterfeit dollars, causing us to change the dollar format in response, that DID hurt us.**
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GM, and all the other brain trusts that rule this portion of the forum.........I would really appreciate your comments on what the video/man says.
I just sat thru the entire video and found it not onley intresting but quite believeable.
I think I saw that gas in Saudi Arabia is 50 cents a gal. Why are we paying so much for foriegn oil when we have resources of our own?
There again take off your tin foil hat for a moment and give us your take/s on the video please......Crafty?
TG
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Let's Drill
By Fred Barnes
The Weekly Standard | Monday, May 19, 2008
Senate Democratic leader Harry Reid, the Mr. Magoo of American politics, stumbled onto the truth last week. He discovered the law of supply and demand. "We want to put [more oil] on the market to increase supply and lower prices," Reid said. "With oil and gas prices continuing to break record highs every day, much more needs to be done."
Indeed it does. But Reid won't allow it. His understanding of economics only extends to matters in which he might embarrass President Bush. The oil he wants on the market is the oil the administration is buying for the Strategic Petroleum Reserve (SPR), now nearly full. Reid got his way. The administration now plans to stop oil shipments to the SPR next month.
Beyond that, Reid and his party are committed to suppressing increased oil production in this country, as they wait for that magical day when fossil fuels are no longer needed to supply the nation's energy needs.
That day may come in 50, 60, 70 years--or never. In the meantime, America needs oil, and the good news is we're awash in the stuff. If the oil reserves miles off the Atlantic and Pacific coasts, in the eastern Gulf of Mexico, and in federally owned lands in the West and Alaska were tapped, our dependence on foreign oil could begin to be reversed. In 10 years, half of America's oil could be produced at home (up from 40 percent), with more coming from increased exports from Canada.
We wouldn't achieve energy independence. That's a pipedream, and anyway it isn't necessary in a global economy with multiple producers. But America would be taking a big step toward energy security and reducing the flow of dollars to unstable countries--notably Iran and Venezuela--that do not wish us well.
So more oil production would strengthen America's national security. By increasing the supply of oil, it would reduce the price, or at least ease the pressure on price from rising world demand. And the mere commitment to boosting production would have a soothing effect on a world market easily spooked by threats to supply.
But there's a problem: Eighty-five percent of the untapped domestic sources of oil have been put off-limits. There's a federally mandated moratorium on drilling offshore, and huge roadblocks to exploiting the oil on the vast federal lands have been erected.
"What keeps these areas closed are exaggerated environmental fears, strong prejudice against oil companies and sheer stupidity," wrote Robert Samuelson recently. Lifting the moratorium requires action by Congress and the White House. So don't hold your breath. The Democratic Congress is a wholly owned subsidiary of the environmental lobby, which regards oil exploration, much less drilling, as a sin against nature.
Advances in technology, however, make serious offshore oil spills a thing of the past. One hundred eight platforms were destroyed and hundreds more damaged in the Gulf of Mexico by hurricanes Rita and Katrina without a single major spill. Californians may remember the damaging spill off Santa Barbara, but that was 40 years ago and was the result of ancient technology.
New technology also means the coastlines would not be marred by unsightly oil platforms. Drilling now goes miles deeper to capture oil once out of reach--and much farther offshore. The moratorium doesn't take this into account. It blindly bars drilling for 200 miles off the Atlantic and Pacific shores.
The United States is virtually alone in treating offshore production as taboo. Great Britain and Norway drill off their coasts without polluting the North Sea. Brazil has achieved energy independence not only by ethanol use but also by expanded offshore oil production. China is now drilling at Cuba's behest in waters halfway to the coast of Florida.
There's another compelling reason to boost domestic production. Oil from current sites is gradually being depleted. Unless new sources come on line in the next few years, America will produce less oil at home and become even more dependent on oil from abroad, the Middle East in particular.
Reid and Democrats, OPEC's best friends, aren't noticeably concerned. Their next step is to remove tax incentives to explore and drill for more oil. And Senator Hillary Clinton is eager to impose a new windfall profits tax on oil revenues. These measures have no purpose other than to punish oil companies. They are counterproductive.
When you remove incentives to produce something and when you slap higher taxes on its producers, one thing happens: You get less of the product. In the case of oil, we need more of it and will for the foreseeable future. The oil is there for the getting. But it won't come out of the ground on its own.
Fred Barnes is executive editor of The Weekly Standard.
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http://centerforsecuritypolicy.org/Home.aspx?CategoryID=132&SubCategoryID=137
Set America Free
CSP Decision Brief | May 19, 2008
by Frank J. Gaffney, Jr.
Q. What do the following recent events have in common?
The President of the United States has prostrated himself for the second time in five months before the King of Saudi Arabia, pleading for more oil. Despite Mr. Bush’s inducements – an array of advanced, offensive arms; the promise of nuclear technology with which the Saudis can expect (like the North Koreans, Iranians, Pakistanis, etc.) to acquire the ultimate weapons; and U.S. help securing Saudi Arabia’s borders (something the President has declined to do at home) – the American plea was spurned. The contempt felt by the House of Saud was captured in its oil minister’s quip, “If you want more oil, buy it.”
The Senate rejected, by a vote of 56-42, an initiative offered by Republicans that called for opening the Arctic National Wildlife Refuge (ANWR) in Alaska and some offshore waters now closed to exploration and exploitation of their substantial oil reserves.
In addition, that chamber’s appropriations committee refused by a similar party-line vote to lift its moratorium on oil-shale production in Colorado. It seems that, if we want more oil, we will have to buy it at ever increasing prices from the Saudis and others even more unfriendly to this country’s national security and economic interests – like Venzuela’s Hugo Chavez or Russia’s Vladimir Putin, perhaps even Iran’s Mahmud Ahmadinejad.
One thing the Senate and House did agree upon, by overwhelmingly bipartisan majorities, was suspending purchases of oil to fill the remaining three percent of the capacity of the Strategic Petroleum Reserves. This action will have negligible (if any) impact on energy prices. But it will ensure that less oil will be available to us than would otherwise have been the case in the event, for example, the next terrorist attack on the Saudi oil infrastructure succeeds where others have failed and seriously disrupts world supplies.
Then there is the newly formed coalition, ostensibly spearheaded by the Grocery Manufacturers’ Association, that has launched a multi-million dollar lobbying effort aimed at discouraging the development of one alternative to oil: domestically produced or imported ethanol. Wrongly asserting that producing this transportation fuel from corn is largely responsible for rising food prices and the attendant global shortages, this instant grassroots (read, “astroturf”) coalition appears to want America to remain essentially dependent on oil. Wonder where the money for this campaign is coming from?
A. These actions – taken against the backdrop of soaring energy prices and the attendant hemorrhage of U.S. petrodollars to, among others, people who wish us ill – represent the sort of behavior in which only a nation utterly unserious about energy security could indulge.
The truth of the matter is that, no matter what we do, we are going to need oil for the foreseeable future. As a result, we should do our utmost to find it and exploit it in places that are either under our control (for example, near where the Cubans and Chinese are getting it off the coast of Florida) or at least friendly to us (notably, Canada, Mexico and Brazil).
It is equally axiomatic that, no matter what we do, we are almost certainly going to have less oil than we need, certainly at prices we can afford. The question is: Are we going to do something to meet the shortfall? Or are we simply going to allow the economy and security of the United States to bleed-out at the hands of the Saudi-led OPEC cartel?
The Set America Free Coalition – an initiative launched several years ago by unlikely array of national security-, environmental- and energy-minded people and organizations from across the political spectrum – is advancing practical, near-term alternatives to that unappetizing and unacceptable prospect.
At the moment, the Coalition is mounting its own campaign aimed at achieving in the immediate future, a simple yet far-reaching goal: Ensuring that each of the 17 million new cars added to America’s highways each year is capable of being powered by ethanol (from whatever source), methanol (ditto) or gasoline (or some combination thereof).
There are already some 6 million of these Flexible Fuel Vehicles (FFVs) on our roads today. Most of these are American-made (name another technology in which Detroit has a competitive advantage?) It costs less than $100 per car to equip new cars with this feature.
Ask yourself, and your elected representatives and would-be Presidents: As each of these cars will last, on average, roughly 17 years, do we want any more of them to be built the old way – namely able to use only gasoline? Can we responsibly continue for another generation to lock our transportation sector (the principal, and most profligate, consumer of imported oil) into dependence on oil substantially imported from unfriendly places?
Dr. Robert Zubrin – a leader of the Set America Free Coalition and author of the terrific new book, Energy Victory: Winning the War on Terror by Breaking Free of Oil – observes that at today’s oil prices, we are allowing the Saudis and their friends to impose the equivalent of a 40 percent income tax at a cost of approximately $3300 on every man woman and child in this country. We literally cannot afford to allow such lunacy to continue.
Sooner or later, Congress will adopt an Open Fuel Standard requiring every new car sold in America to be an FFV. The effect will be, in short order, to create an immense and highly competitive market for alternative, “Freedom Fuels” that we can make here or buy from friends. That, in turn, will set America free by beginning to end its cars’ present addiction to oil. Why wait any longer?
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Woof, I'am really hoping to get some personal comments from the video posted by Doug and does not get buried beneath a mega list of articles and writings.... I rarely come down to this forum becuase its impossible for me to keep up with all the articles to read.
Crafty, and all others I know you guys are well read.....and would just like to hear what you have to say?
My tin foil comments were directed back at GM's quote:
My tin foil hat alarm is going off, however I'll watch the video before rendering a more firm opinion.
Meant in a light hearted manner and ceratinly not directed towards anyone.....esp not Crafty.....
I just added his name at the end of the sentence hoping to get his opinon.
There again take off your tin foil hat for a moment and give us your take/s on the video please......Crafty?
I'am getting really paraniod on what I say on the net.....that it does NOT get taken wrongly. :lol: :|
TG
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Tom:
I got about 4:30 into it and , , , that's as far as I can go.
The guy makes some sound points. Yes there is an excrement load of undrilled oil out there in various forms. Some of it is not being drilled because its really dirty, or would require refineries with capabilities as yet unbuilt. Why hasn't the US built a refinery since the mid 1970s? Good question , , , and its answer is not the rapacious oil companies, who would love to have lots of refineries, but the liberals who accuse the oil companies of being the problem.
Some of it is not being used because the planet cannot support the filth that would ensue from such dirty supplies.
Some of it requires huge investment in infrastructure (e.g. how the hell to get the Canadian tar sands to market?) and burn it cleanly?
Some of it is there, but not likely to be economically successful for a long time.
Some investment is forclosed because of security risks. Woud you drill in Kazakstan if it were your money? Some of it is blocked off due to foreign domestic politics e.g. Mexico.
Some of the guys numbers SOUND authoritative, but I'm not aware of the Russians having huge finds at 40,000' (40,000' ???) beneath the Artic Sea. I know they have been manuvering to claim most of the Artic sea bed with some tiny scientific drilling, (there's a thread on this forum devoted to this BTW) but to read this as something being held back from market is , , , silly.
Ultimately, just because it exists, does not mean its available in a politically secure, economically profitable, and environmentally acceptable manner.
Here's something from Stratfor I think a better use of our time:
May 27, 2008
By George Friedman
Oil prices have risen dramatically over the past year. When they passed $100 a barrel, they hit new heights, expressed in dollars adjusted for inflation. As they passed $120 a barrel, they clearly began to have global impact. Recently, we have seen startling rises in the price of food, particularly grains. Apart from higher prices, there have been disruptions in the availability of food as governments limit food exports and as hoarding increases in anticipation of even higher prices.
Oil and food differ from other commodities in that they are indispensable for the functioning of society. Food obviously is the more immediately essential. Food shortages can trigger social and political instability with startling swiftness. It does not take long to starve to death. Oil has a less-immediate — but perhaps broader — impact. Everything, including growing and marketing food, depends on energy; and oil is the world’s primary source of energy, particularly in transportation. Oil and grains — where the shortages hit hardest — are not merely strategic commodities. They are geopolitical commodities. All nations require them, and a shift in the price or availability of either triggers shifts in relationships within and among nations.
It is not altogether clear to us why oil and grains have behaved as they have. The question for us is what impact this generalized rise in commodity prices — particularly energy and food — will have on the international system. We understand that it is possible that the price of both will plunge. There is certainly a speculative element in both. Nevertheless, based on the realities of supply conditions, we do not expect the price of either to fall to levels that existed in 2003. We will proceed in this analysis on the assumption that these prices will fluctuate, but that they will remain dramatically higher than prices were from the 1980s to the mid-2000s.
If that assumption is true and we continue to see elevated commodity prices, perhaps rising substantially higher than they are now, then it seems to us that we have entered a new geopolitical era. Since the end of World War II, we have lived in three geopolitical regimes, broadly understood:
The Cold War between the United States and the Soviet Union, in which the focus was on the military balance between those two countries, particularly on the nuclear balance. During this period, all countries, in some way or another, defined their behavior in terms of the U.S.-Soviet competition.
The period from the fall of the Berlin Wall until 9/11, when the primary focus of the world was on economic development. This was the period in which former communist countries redefined themselves, East and Southeast Asian economies surged and collapsed, and China grew dramatically. It was a period in which politico-military power was secondary and economic power primary.
The period from 9/11 until today that has been defined in terms of the increasing complexity of the U.S.-jihadist war — a reality that supplanted the second phase and redefined the international system dramatically.
With the U.S.-jihadist war in either a stalemate or a long-term evolution, its impact on the international system is diminishing. First, it has lost its dynamism. The conflict is no longer drawing other countries into it. Second, it is becoming an endemic reality rather than an urgent crisis. The international system has accommodated itself to the conflict, and its claims on that system are lessening.
The surge in commodity prices — particularly oil — has superseded the U.S.-jihadist war, much as the war superseded the period in which economic issues dominated the global system. This does not mean that the U.S.-jihadist war will not continue to rage, any more than 9/11 abolished economic issues. Rather, it means that a new dynamic has inserted itself into the international system and is in the process of transforming it.
It is a cliche that money and power are linked. It is nevertheless true. Economic power creates political and military power, just as political and military power can create economic power. The rise in the price of oil is triggering shifts in economic power that are in turn creating changes in the international order. This was not apparent until now because of three reasons. First, oil prices had not risen to the level where they had geopolitical impact. The system was ignoring higher prices. Second, they had not been joined in crisis condition by grain prices. Third, the permanence of higher prices had not been clear. When $70-a-barrel oil seemed impermanent, and likely to fall below $50, oil was viewed very differently than it was at $130, where a decline to $100 would be dramatic and a fall to $70 beyond the calculation of most. As oil passed $120 a barrel, the international system, in our view, started to reshape itself in what will be a long-term process.
Obviously, the winners in this game are those who export oil, and the losers are those who import it. The victory is not only economic but political as well. The ability to control where exports go and where they don’t go transforms into political power. The ability to export in a seller’s market not only increases wealth but also increases the ability to coerce, if that is desired.
The game is somewhat more complex than this. The real winners are countries that can export and generate cash in excess of what they need domestically. So countries such as Venezuela, Indonesia and Nigeria might benefit from higher prices, but they absorb all the wealth that is transferred to them. Countries such as Saudi Arabia do not need to use so much of their wealth for domestic needs. They control huge and increasing pools of cash that they can use for everything from achieving domestic political stability to influencing regional governments and the global economic system. Indeed, the entire Arabian Peninsula is in this position.
The big losers are countries that not only have to import oil but also are heavily industrialized relative to their economy. Countries in which service makes up a larger sector than manufacturing obviously use less oil for critical economic functions than do countries that are heavily manufacturing-oriented. Certainly, consumers in countries such as the United States are hurt by rising prices. And these countries’ economies might slow. But higher oil prices simply do not have the same impact that they do on countries that both are primarily manufacturing-oriented and have a consumer base driving cars.
East Asia has been most affected by the combination of sustained high oil prices and disruptions in the food supply. Japan, which imports all of its oil and remains heavily industrialized (along with South Korea), is obviously affected. But the most immediately affected is China, where shortages of diesel fuel have been reported. China’s miracle — rapid industrialization — has now met its Achilles’ heel: high energy prices.
China is facing higher energy prices at a time when the U.S. economy is weak and the ability to raise prices is limited. As oil prices increase costs, the Chinese continue to export and, with some exceptions, are holding prices. The reason is simple. The Chinese are aware that slowing exports could cause some businesses to fail. That would lead to unemployment, which in turn will lead to instability. The Chinese have their hands full between natural disasters, Tibet, terrorism and the Olympics. They do not need a wave of business failures.
Therefore, they are continuing to cap the domestic price of gasoline. This has caused tension between the government and Chinese oil companies, which have refused to distribute at capped prices. Behind this power struggle is this reality: The Chinese government can afford to subsidize oil prices to maintain social stability, but given the need to export, they are effectively squeezing profits out of exports. Between subsidies and no-profit exports, China’s reserves could shrink with remarkable speed, leaving their financial system — already overloaded with nonperforming loans — vulnerable. If they take the cap off, they face potential domestic unrest.
The Chinese dilemma is present throughout Asia. But just as Asia is the big loser because of long-term high oil prices coupled with food disruptions, Russia is the big winner. Russia is an exporter of natural gas and oil. It also could be a massive exporter of grains if prices were attractive enough and if it had the infrastructure (crop failures in Russia are a thing of the past). Russia has been very careful, under Vladimir Putin, not to assume that energy prices will remain high and has taken advantage of high prices to accumulate substantial foreign currency reserves. That puts them in a doubly-strong position. Economically, they are becoming major players in global acquisitions. Politically, countries that have become dependent on Russian energy exports — and this includes a good part of Europe — are vulnerable, precisely because the Russians are in a surplus-cash position. They could tweak energy availability, hurting the Europeans badly, if they chose. They will not need to. The Europeans, aware of what could happen, will tread lightly in order to ensure that it doesn’t happen.
As we have already said, the biggest winners are the countries of the Arabian Peninsula. Although somewhat strained, these countries never really suffered during the period of low oil prices. They have now more than rebalanced their financial system and are making the most of it. This is a time when they absolutely do not want anything disrupting the flow of oil from their region. Closing the Strait of Hormuz, for example, would be disastrous to them. We therefore see the Saudis, in particular, taking steps to stabilize the region. This includes supporting Israeli-Syrian peace talks, using influence with Sunnis in Iraq to confront al Qaeda, making certain that Shiites in Saudi Arabia profit from the boom. (Other Gulf countries are doing the same with their Shiites. This is designed to remove one of Iran’s levers in the region: a rising of Shiites in the Arabian Peninsula.) In addition, the Saudis are using their economic power to re-establish the relationship they had with the United States before 9/11. With the financial institutions in the United States in disarray, the Arabian Peninsula can be very helpful.
China is in an increasingly insular and defensive position. The tension is palpable, particularly in Central Asia, which Russia has traditionally dominated and where China is becoming increasingly active in making energy investments. The Russians are becoming more assertive, using their economic position to improve their geopolitical position in the region. The Saudis are using their money to try to stabilize the region. With oil above $120 a barrel, the last thing they need is a war disrupting their ability to sell. They do not want to see the Iranians mining the Strait of Hormuz or the Americans trying to blockade Iran.
The Iranians themselves are facing problems. Despite being the world’s fifth-largest oil exporter, Iran also is the world’s second-largest gasoline importer, taking in roughly 40 percent of its annual demand. Because of the type of oil they have, and because they have neglected their oil industry over the last 30 years, their ability to participate in the bonanza is severely limited. It is obvious that there is now internal political tension between the president and the religious leadership over the status of the economy. Put differently, Iranians are asking how they got into this situation.
Suddenly, the regional dynamics have changed. The Saudi royal family is secure against any threats. They can buy peace on the Peninsula. The high price of oil makes even Iraqis think that it might be time to pump more oil rather than fight. Certainly the Iranians, Saudis and Kuwaitis are thinking of ways of getting into the action, and all have the means and geography to benefit from an Iraqi oil renaissance. The war in Iraq did not begin over oil — a point we have made many times — but it might well be brought under control because of oil.
For the United States, the situation is largely a push. The United States is an oil importer, but its relative vulnerability to high energy prices is nothing like it was in 1973, during the Arab oil embargo. De-industrialization has clearly had its upside. At the same time, the United States is a food exporter, along with Canada, Australia, Argentina and others. Higher grain prices help the United States. The shifts will not change the status of the United States, but they might create a new dynamic in the Gulf region that could change the framework of the Iraqi war.
This is far from an exhaustive examination of the global shifts caused by rising oil and grain prices. Our point is this: High oil prices can increase as well as decrease stability. In Iraq — but not in Afghanistan — the war has already been regionally overshadowed by high oil prices. Oil-exporting countries are in a moneymaking mode, and even the Iranians are trying to figure out how to get into the action; it’s hard to see how they can without the participation of the Western oil majors — and this requires burying the hatchet with the United States. Groups such as al Qaeda and Hezbollah are decidedly secondary to these considerations.
We are very early in this process, and these are just our opening thoughts. But in our view, a wire has been tripped, and the world is refocusing on high commodity prices. As always in geopolitics, issues from the last generation linger, but they are no longer the focus. Last week there was talk of Strategic Arms Reduction Treaty (START) talks between the United States and Russia — a fossil from the Cold War. These things never go away. But history moves on. It seems to us that history is moving.
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Woof, Guro Crafty,
I got about 4:30 into it and , , , that's as far as I can go.
:-D Fair enough.... I did read where Russia has drilled that deep, but not for oil but to study the earth, reportedly for "oil research reasons".
I guess we have to let this thing play out. Obviously we will never see pre 2000 prices again.....
I do not believe that demand is driving the price......at least not at the rate we are seeing.
I'am more inclined to beleive speculators are driving price......
I also think that it will be sometime before we recover and balance out.......
TG
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This is a different Doug commenting. Thank you Doug S. for posting the video. I particularly appreciate the serious work that went into making the summary. Due to internet and time constraints, I haven't seen the video but offer my opinions on the points in the summary. This is NOT intended as shoot the messenger, just comment on substantive points made.
Again, just my opinion but I don't like the argument style of posting pieces of truth to build trust and then making conclusions that don't necessarily or logically follow.
1) "The oil companies do make profits however it's not near as much as the middle men that we never hear about being the IMF and the World Bank."
- Oil companies make about 8 cents. State and feds make about 65 cents in some cases off of a gallon of gas. Look there - at government waste and largess - if you need a side show villain. I don't know any reason that IMF or World Bank would get a cut on every gallon of our gas. They are a separate side show and probably have plenty of waste and corruption to find when time permits. They are not the reason prices are high. Prices are high because demand grew and supply didn't and it is exaggerated by the inelastic nature of gasoline demand within the price ranges we have seen. I thought the American consumer could easily outbid the foreign consumer of China or India for example until I read here I think that those countries subsidize the cost to the consumer to soften the price rise. Like third party pay in health care, add that distortion to the runaway oil futures market.
2) "One of the if not the largest oil fields in the world is in Gull Island, Alaska and would supposedly last us 200 years"
- I don't know the details of each oil field. Like Crafty posted since, there could be issues of quality or difficulty in some, but we certainly have plenty of known sources that are blocked by politics. In other words, oil prices are high because of the policies we choose.
3) "Oil is the world currency and controls almost everything we do."
- Oil is a big, big deal. There is no need to overstate it's importance. The amount of new oil that we need to stabilize the markets is not that large. If prices go up forever, the alternatives will just emerge that much sooner causing oil's own obsolescence. We can't instantly shut off our usage and producers like Saudi can't shut off their supply. Producing and selling oil to them is their cash register and they are as dependent as us and more so.
4) "Back in the 1960s or early 1970s, then Secretary of State Henry Kissinger went to the middle eastern countries to negotiate a deal with them to sell us their oil and in return, they must denominate all oil sales on US Dollar currency. Another part of the deal was that they had to take a portion of the oil revenues and buy our national debt. The Saudi's agreed however Iran and Iraq did not."
- I'll assume it's largely a true story but meaningless to me. A handshake agreement with Nixon's Secretary of State is not a treaty approved by the U.S. senate or binding on America or future administrations. It certainly isn't binding on the countries of the middle east. Iraq of Saddam and Iran run by mullahs are known enemies and are not expected to act in our best interest or keep commitments, especially ones they never made.
5) "Iraq supposedly had plans to start denominating oil in foreign currency and had to be taken care of. He named the name of a guy who was sent into Iraq to tell their leaders that if they invaded Kwuait that we would not intervene. This was supposedly a set up. When we didn't finish the job the first time around, we had to go back."
- The name was a gal named April GIlepie, Ambassador to Iraq. This is where the tin hat story begins IMO. A Bush-I official said that the slant drilling allegation of Iraq against Kuwait was a matter for those parties, not for the U.S. Political opponents and conspiracists have long run with this to pretend it was the green light for Saddam to take Kuwait by force and conquest for annexation without consequence. I find that preposterous. If they did read some clumsy words from a minor political appointee that way I guess they were badly mistaken and Saddam in hell probably realizes his miscalculation right now. The sucker punch or inducement argument also fails because we now know the Americans and the coalition still had no intention of toppling Saddam in our reaction, although they could have.
6) "Iran is now a major threat to us because they are already denominating their oil in Euros and Yen. China has already negotiated millions upon millions of barrels of oil contracts in Yen currency."
- Again, Iran as it is run today is an enemy of the United States. Of course they will avoid our currency or helping us in any way at every turn. They are a threat because of their own choices and policies, supporting Hizbullah, supporting destruction of Israel, supporting the killing of Americans in Iraq, supporting the killing of civilians to escalate the violence in Iraq and continue the conflict, and just general support for global jihad and literal declarations of death to America.
7) "Iran supposedly has a plan to flood the world with cheap oil which could have a devastating effect on our economy and the value of our dollar."
- Bring it on IMO. Why would we be hurt by cheap oil? Frankly Iran is cash strapped and unable to 'flood' any market with oil or any other product.
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Ok, I watched the first 45-50 minutes of this drivel. At least it confirmed that my tin foil detector is calibrated. Unless Mr. Williams was saving up all the hard evidence for the last 20 minutes, there is nothing of merit to his claims. Typical conspiracy lunacy, small bits of facts strung together with giant leaps of logic and misinformation.
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Woof GM, :lol:
Ok, I watched the first 45-50 minutes of this drivel. At least it confirmed that my tin foil detector is calibrated.
What held you 45-50 minutes? Crafty onley made it 4:30.....(light weight :lol:)
I think the thing that gets me the most is that we (the u.s.) has the oil, to make us independent from foriegn oil (or much less dependent).....but we don't get it or go after it.....whats wrong with that picture?
I just have a hard time buying the "Oh its the liberal lefty's that won't lets us get it" babble......(nonsense)
When did that ever stop a good oil man :roll: (speaking of Bush/family and him doing what he wants) :wink:
You have to admit there is something funny about, allowing our enemies to hold our ass to the gas lamp.....why would we want to give them that kind of power.
Lets be honest......oil rules the world.
TG
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Tom,
Look up the environmental laws passed at the federal and state level since the 1970's. We haven't built an oil refinery since the 70's either. Thank the NIMBYs/environmentalists for this. No dark conspiracy, no cabal of oilmen plotting global hegemony with the help of "bankers" (codeword for the JooooOOOOoooos). After all, no conspiracy theory is complete without some semetic types pulling strings from the shadows, so Henry Kissinger makes dark deals with Iran and Iraq, despite both being under different governments after Henry leaves State.
This clown doesn't even know how to pronounce Bill Maher's name correctly. I'm sure the rest of his research is just as dilligent.
So, if one has no grasp of history, economics or geopolitics, his ideas make sense.
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GM, I would be one to fall into the category of "no grasp of history ,economics, or geopolitics"...esp when it comes to oil and its production in this country.
I'am not insinuating that this guy is on to something........
Its really hard for me though, to deal with the idea that we have allowed ourselves into the situation that has now evolved.......and why did it take so long to happen?
Talk about feeling "Bled out" :|......
TG
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Tom,
We got into this problem like we generally get into every crisis. The politicians care about getting re-elected, meaning they try to push legislation that puts money (pork) into the voters' pockets while not pissing the voters off. The high level gov't bureaucrats are busy trying to create bigger gov't entities so the get to the next supergrade of pay. The general public is busy watching "American Idol" or the next distraction of the moment, so what starts out as small problems grow until the public is jarred out of it's slumber by the neglected issue when it impacts them directly. Then the sheep stampede towards "Somebody do SOMETHING NOW!".
Then it's back to sleep. Until next time....
Illegal immigration is a good example of the above, or the rise of Hitler if you want to look back farther.
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"Its really hard for me though, to deal with the idea that we have allowed ourselves into the situation that has now evolved.......and why did it take so long to happen?"
Well, we have-- and a goodly portion of the reason is that for a variety of reasons, some good, some understandable, and a lot of them really stupid-- for decades the liberal left has sedulously worked to prevent the development of additional supplies.
The reason it has taken so long is that this is an amazing country that has a relatively free market (though a lot less than it used to be).
Glad to see you expanding your reading to this forum. I think if you go back into the threads that address issues of interest to you, you will find them to be wonderful tools of self-education and research. It is why this forum is organized this way.
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ACTION ALERT: Fight Back Against High Gas Prices And the Politicians Who Will Make them Higher Still
By Newt Gingrich
There must be something about springtime in Washington that makes Senators forget where they came from.
Next week, the Senate is set to begin debate on a bill that will raise the price of gasoline, diesel fuel, heating oil and aviation fuel.(view this Heritage Foundation state-by-state breakdown to find out how much Warner Lieberman will cost you). It's the Warner-Lieberman global warming bill, and its supporters are as misguided and out-of-touch with the American people as the supporters of last spring's immigration amnesty bill - and we all remember how that turned out.
Our Goal: 100,000 Voices the Senate Can't Ignore
There are two things you can do now to fight back.
First, call or email your Senator and tell him or her to vote "no" on Warner-Lieberman - "no" on raising the cost of driving to work, heating your home, and feeding your family.
Second, visit americansolutions.com/drillnow and sign our "Drill Here, Drill Now, Pay Less" petition.
The petition is simple but powerful. It says:
We, therefore, the undersigned citizens of the United States, petition the U.S. Congress to act immediately to lower gasoline prices by authorizing the exploration of proven energy reserves to reduce our dependence on foreign energy sources from unstable countries.
In just a few short days, over 45,000 Americans have signed the pledge.
And with your help, as the Senate begins to debate Warner-Lieberman, American Solutions will present the names of 100,000 of their constituents who will hold them accountable if they fail to allow America the freedom to use its own energy resources instead of relying on foreign dictators.
Americans truly have a choice - a choice between the Pay More, Send More Money to Foreign Dictators and Cripple America Left and the Produce More, Enjoy More, Pay Less, Stengthen American Center-Right Majority.
Make your choice by visiting americansolutions.com/drillnow.
Newt Gingrich
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One more for you Tom:
No doubt speculation is a part of this, but ultimately speculation is a zero sum game that punishes most of its players.
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A bold and long-overdue move aimed at curbing the spread of the latest economic cancer — the seemingly unstoppable rise in oil and gas prices — may soon be on the way.
That's the sunny forecast from one of the country's leading heavyweight investment strategists, Bill Knapp, who tells me relief could be coming via a sharp increase in margin requirements for the purchases of oil futures, an event he sees occurring in the next two to three months.
Speculative trading fueled by low margin requirements, where buyers can acquire a barrel of oil (now around $132.40) for about $6 or $7, or at a leveraged ratio of roughly 20 to 1, has been the major driver of the skyrocketing price.
Congress has been pushing the Commodity Futures Trading Commission, which regulates commodity futures and options markets in America, to hike margin requirements on crude purchases in an effort to temper the rise in oil prices and give consumers some relief at the gas pump.
Given the impending presidential election and the national uproar over swelling gas prices, Mr. Knapp, who helps guide strategy at a $37 billion money management subsidiary of New York Life, MainStay Investments, gives Congress a 50-50 chance of bringing about higher margin requirements and increasing the leveraged ratio to possibly 4:1.
Oppenheimer & Co.'s veteran energy analyst, Fadel Gheit, sums it up: "With the stock market acting so erratically, oil is the only game in town; it's the last bastion for traders. Government action to boost margin requirements is badly needed and long overdue."
A CFTC spokesman declined to comment.
With the price of gas likely within days of exceeding a national average of $4 a gallon, and growing speculation that prices of $5-plus will begin popping up frequently during the upcoming summer driving season, government action to halt the rise through higher margin requirements on oil purchases is also viewed as probable by a number of other pros. Each $1 a barrel increase or decrease in the price of oil eventually adds up to 2.5 cents more or less at the gas pump.
Mr. Knapp believes that an increase in margin requirements could trigger an avalanche of oil sales by traders that could knock the price down to between $60 and $80 a barrel. "Considering all the speculation, you could see a wave of profit taking by speculators that could drive down oil prices pretty quickly," he says.
He also says the price of oil could come under pressure from a falloff in demand from developed countries, notably America, Japan, and some in Europe.
Mr. Knapp cautions, though, that "if the price of oil doesn't come down really soon, you could see the U.S., as well as the whole world, dip into a recession later this year and in early 2009." Actually, given his projected boost in margin requirements for oil purchases, he thinks a recession can be avoided. This assumes, he points out, "we can weather the triple whammy, namely the downturn in housing, the credit crisis, and elevated energy prices."
The latest housing numbers, however, show continued weakness, with the backlog of single-family homes at the highest level in more than two decades. At the same time, April sales of existing homes fell for the eighth time in the past nine months as prices dropped 8% from a year ago. Still, Mr. Knapp sees some positive signs. He points, for example, to some pockets of recovery, increased affordability due to the decline in home prices, pent-up demand, and decent mortgage rates. Taking note, as well, of recent peppier figures on housing starts and permits, he reckons a housing recovery could kick off this summer.
As for ongoing credit worries, he thinks they may be overblown, given declining write-downs in the financial sector.
In arguing against a recession, Mr. Knapp holds out the possibility of a single quarter of negative growth in the gross domestic product sandwiched in between two quarters of puny GDP growth. A better-than-expected trade deficit in March suggests to him that first-quarter GDP will be revised upward to 1% growth or better from the initial estimated growth of 0.6%.
Relating his thinking to the likely direction of the stock market, Mr. Knapp observes that equities are basically attractive, assuming you burst the oil bubble, lower inflation expectations, and housing rebounds.
Technology stands out at the moment as his top-rated sector. What about those rampaging energy stocks? Despite the big gains, he views their valuations as reasonable, based on the current price of oil.
dandordan@aol.com
http://www.nysun.com/business/gas-price-help-may-be-on-the-way/78736/
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Poor Tom-- here's yet another one for you :-D
WSJ
Blame Congress for High Oil Prices
By MACKUBIN THOMAS OWENS
May 29, 2008; Page A17
Gasoline prices are through the roof and Americans are angry. Someone must be to blame and the obvious villain is "Big Oil" with its alleged ability to gouge consumers and achieve unconscionable, "windfall" profits. Congress is in a vile mood, and has dragged oil industry executives before its committees for show trials, issuing predictable threats of punishment, e.g. a "windfall profits tax."
But if there is a villain in all of this, it is Congress itself. That venerable body has made it impossible for U.S. producers of crude oil to tap significant domestic reserves of oil and gas, and it has foreclosed economically viable alternative sources of energy in favor of unfeasible alternatives such as wind and solar. In addition, Congress has slapped substantial taxes on gasoline. Indeed, as oil industry executives reiterated in their appearance before the Senate Judiciary Committee on May 21, 15% of the cost of gasoline at the pump goes for taxes, while only 4% represents oil company profits.
To understand the depth of congressional complicity in the high price of gasoline, one must understand that crude oil prices explain 97% of the variation in the pretax price of gasoline. That price, which has risen to record levels, is set by the intersection of supply and demand. On the one hand, world-wide demand has accelerated mainly due to the rapid growth of China and India.
On the other hand, supply has been curtailed by the cartel-like behavior of foreign national oil companies, which control nearly 80% of world petroleum reserves. Faced with little competition in the production of crude oil, the members of this cartel benefit from keeping the commodity in the ground, confident that increasing demand will make it more valuable in the future. Despite its pious denunciations of the behavior of U.S. investor-owned oil companies (IOCs), Congress by its actions over the years has ensured the economic viability of the national oil company cartel.
It has done so by preventing the exploitation by IOCs of reserves available in nonpark federal lands in the West, Alaska and under the waters off our coasts. These areas hold an estimated 635 trillion cubic feet of recoverable natural gas – enough to meet the needs of the 60 million American homes fueled by natural gas for over a century. They also hold an estimated 112 billion barrels of recoverable oil – enough to produce gasoline for 60 million cars and fuel oil for 25 million homes for 60 years.
This doesn't even include substantial oil shale resources economically recoverable at oil prices substantially lower than those prevailing today. In an exchange between Sen. Orin Hatch (R., Utah) and John Hofmeister, president of Shell Oil Company during the May 21 Senate Judiciary Committee hearing, the point was made that anywhere from 800 million to two trillion barrels of oil are available from oil shale in Colorado, Utah and Wyoming.
If Congress really cared about the economic well-being of American citizens, it would stop fulminating against IOCs and reverse current policies that discourage, indeed prohibit, the production of domestic oil and natural gas. Even the announcement that Congress was opening the way for domestic production would lead to downward pressure on oil prices.
There is an historical precedent for such a step: Ronald Reagan's deregulation of domestic crude oil prices at the beginning of his first term. At the time, thanks to the decision by the Organization of Petroleum Exporting Countries (OPEC) to curtail output, the price of oil was at a level that in real terms is only now being matched. Domestic price controls ensured that the OPEC cartel would face little or no competition in the production of oil.
Price controls were exacerbated by other wrongheaded policies stimulated by the two "energy crises" of the 1970s. One of the most egregious was the infamous "windfall profits" tax, designed to punish oil companies for alleged profiteering. But since it applied to even newly discovered oil, its main impact was to discourage the exploration and drilling that would have increased oil supplies.
Although the energy problems of the 1970s were traceable to government policies, Reagan's decision to deregulate oil prices was ridiculed by policy makers, especially those who had served in the previous administration. For instance, Frank Zarb, who had been Jimmy Carter's "energy czar," predicted that decontrolling the price of crude oil would lead to gasoline prices of $10 a gallon. Instead, the world price of oil plummeted, helping to fuel the extraordinary economic growth of the 1980s.
Reagan's deregulation of crude oil prices created incentives for domestic producers to invest in exploration and to increase production. The threat of increased output by non-OPEC producers destroyed the discipline among OPEC members necessary to restrict production to maintain high prices. Facing the likelihood that an increase in supply would lead to lower future prices, OPEC producers increased output in the hopes of maximizing profits before prices fell. The cascading effect caused oil prices to tumble.
As in the 1970s, U.S. energy policies have essentially restricted the exploitation of domestic sources of energy. Curtailed supplies have combined with rapid, world-wide energy demand to increase the price of oil and other sources of energy. This provides leverage to foreign producers and threatens U.S. energy security. Freeing up domestic energy resources will do today what President Reagan's decision to deregulate oil prices in 1981 did then: cause oil prices to fall, thereby enhancing U.S. energy security.
Mr. Owens is a professor at the Naval War College in Newport, R.I., and editor of Orbis, the journal of the Foreign Policy Research Institute in Philadelphia.
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Woof, I'am reading them, but at this point not feeling much better........Esp after the WSJ article posted today. :|
Thats not too encouraging......though it could be if some real and positive action by our politicans would take place........Not holding my breath for that.......
Hostage to oil/ gov.
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*But if there is a villain in all of this, it is Congress itself*
And with a Democratic landslide in November it will only get far worse.
This is still the greatest country. It won't continue to be if BO is President. Foreigners like him because they know he will negotiate away our leadership position in the world so we can be "liked", and they, not us will be the better.
BO is a fool. And so are Americans if he wins. He will exacerbate our weaknesses. And that is why he is popular overseas. Plain and simple. Why else does our enemies love him.
Maybe it is better if he wins. Go the Jimmy Carter way again. Apparantly many people need to be reminded we will screw ourlseves. If McCain is Bush three than BO is Carter 2!
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http://www.eia.doe.gov/pub/oil_gas/petroleum/analysis_publications/primer_on_gasoline_prices/html/petbro.html
and
http://tonto.eia.doe.gov/oog/info/gdu/gasdiesel.asp
Have only skimmed, but sent by a friend of reliable judgment.
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"The true villain in our having to cough up $60, $70 or $80 to fill our gas tanks is the U.S. Congress caught in the grip of environmental extremists. But if reality is too difficult to swallow, we can continue to blame and support the congressional attack on oil executives, turn food into oil and think of other crackpot "solutions."
http://www.townhall.com/columnists/WalterEWilliams/2008/06/04/dumb_or_ill-informed
***What assumptions do congressmen make about the American people? Do they assume that we're dumb or ill-informed about the energy problems we are experiencing? Every time there has been a huge spike in gasoline prices, Congress hauls oil company executives before their committees to accuse them of greed, obscene profits and price-fixing. One federal investigation after another of supposed oil company misconduct turns up nothing to substantiate congressional allegations. Unfortunately, the congressional hearings make front page news and lead the evening television news, but the results of federal investigations that follow are only casually mentioned deep in the body of newspapers and get little or no time on the evening television news. If news media people had an ounce of integrity, they would highlight the federal investigation findings that undermine congressional charges of oil company misconduct and they would question the congressmen who made those charges.
Americans might prefer heroes-and-villains explanations to problems to reality-based explanations. A politically satisfying explanation for today's $4 a gallon price, when it was less than $2 a gallon a couple of years ago, is because oil company executives have all of a sudden become greedy in their pursuit of "obscene" profits. As such, congressmen, as our heroes, should call these greedy men on the carpet and take sanctions against them in the forms of windfall profits tax, price controls and other measures to take away their ill-gotten gains -- never mind the effects of the 1980 windfall profits tax. According to the Congressional Research Service, the 1980 windfall profits tax had the effect of decreasing domestic production by 3 percent to 6 percent, thereby increasing American dependence on foreign oil sources by 8 percent to 16 percent.
Controlling the price of anything is very difficult and it can only be accomplished through the force of government, mostly by restricting supply. The U.S. Congress is a major player in oil supply restriction, and OPEC nations must be laughing all the way to the bank. Congress has banned energy exploration in 85 percent of our coastal waters. Ironically, China, in conjunction with Cuba, is drilling for oil nearer to our coastline than U.S. oil companies are permitted. According to "We don't have to take $4 gas prices -- we can drill," written by Sterling Burnett in the Houston Chronicle (5/21/08), "It is estimated that beneath America's coast lies enough oil to fuel 60 million cars in the United States for 60 years and enough natural gas to heat 60 million homes for 160 years. … If allowed access to American oil reserves in Alaska and off our coastline, American oil companies could increase our country's reserves an estimated fivefold, taking the United States from 11th place to fourth among the countries with proven oil reserves."
You say, "What about the environmental impact?" Contrary to the hysterical claims made by environmental extremists, caribou and other wildlife have expanded and flourished in and around Alaska's Prudhoe Bay, unaffected by the oil and gas development. What's more, Burnett points out that the "two leading environmental groups, the Audubon Society and the Nature Conservancy, have allowed oil and gas production on several of their most important and unique nature preserves."
Environmentalists come to their senses when non-drilling philosophy costs them something. It's two-faced hypocrisy. At times I've suggested that the best way to get oil exploration in the Alaska National Wildlife Reserve is to give the land to environmentalists. You can bet they wouldn't sit on billions of dollars of oil and gas.
The true villain in our having to cough up $60, $70 or $80 to fill our gas tanks is the U.S. Congress caught in the grip of environmental extremists. But if reality is too difficult to swallow, we can continue to blame and support the congressional attack on oil executives, turn food into oil and think of other crackpot "solutions."***
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Dubai's Favorite Senators
June 10, 2008
The first refuge of a politician panicked by rising prices is always to blame "speculators." So right on time for this election season, Congress has decided to do something about rising oil prices by shooting the messenger known as the energy futures market. Apparently this is easier than offending the Sierra Club by voting for more domestic energy supply.
Futures markets aren't some shadowy dangerous force, but are essentially a price discovery mechanism. They allow commodity producers and consumers to lock in the future price of goods, helping to hedge against future price movements. In the case of oil prices, they are a bet about supply and demand and the future rate of inflation. Democrats nonetheless now argue that these futures markets are generating the wrong prices for oil and other commodities.
And who are these "speculators" driving up prices? The futures market operator Intercontinental Exchange says that an increasing share of its customers are not financial houses but commercial firms that need to manage oil-price risks – refiners, airlines, and other major energy consumers. Another term for these "speculators" would be "American business."
Not ironically, the leaders of Capitol Hill's shoot-the-messenger caucus are among those most culpable for the lack of domestic oil supplies. Senator Maria Cantwell (D., Wash.) has been threatening to hold up appointments to the Commodity Futures Trading Commission until the CFTC increases regulation of oil trading. In the best tradition of bureaucratic self-protection, the CFTC's acting chief Walter Lukken has agreed to investigate.
Ms. Cantwell's recent press release on "outrageous energy prices" didn't mention her own contributions to the problem. According to the Almanac of American Politics, she "successfully worked the phones" in 2005 to round up enough colleagues to block drilling in the Alaskan wilderness. Ms. Cantwell has also backed a slew of mandates and subsidies that have helped to raise food prices by diverting corn and other crops to fuel. She even claims to have helped create the biofuels industry in her state.
Her counterpart in the House is Michigan's Bart Stupak, who claims special credit for a permanent ban on drilling in the Great Lakes and has also cast votes against exploration in Alaska and off the California coast. With $4 gasoline, this is a man in need of political cover as Michiganders head into the summer driving season. A spokesman says Mr. Stupak is hoping to roll out a new bill by the end of this week to require "additional reporting and oversight' in the oil futures markets.
Then there's New York Senator Chuck Schumer, another staunch opponent of new domestic oil supplies. Mr. Schumer has egged on the Federal Reserve's rate-cutting binge that has contributed so much to the oil price spike. But, with impeccable political timing, he now suspects "price manipulation by speculators" is the real cause of rising gas prices.
Mr. Schumer's answer is the "Consumer-First Energy Act," due for a cloture vote in the Senate today. Bundled with a windfall profits tax on oil companies, the plan also includes an increase in margin requirements for those who wish to trade oil futures. This would of course make it more expensive to trade in U.S. futures markets, which in a world of computerized, instantaneous trading means that those trades would merely move to markets overseas. As luck would have it, the Dubai Mercantile Exchange celebrated its first birthday last week with the launch of two new oil futures contracts that compete with those offered by American exchanges.
Leave aside the question of whether Mr. Schumer believes that the Dubai exchange, which is majority-owned by Middle Eastern governments, will offer more consumer protection than America's shareholder-owned exchanges. This is the same Chuck Schumer who warned in 2007 that heavy regulation threatens New York's pre-eminence in global finance. Along with Mayor Michael Bloomberg and former Governor Eliot Spitzer, Mr. Schumer introduced a long report on the threats facing New York with a short note that specifically mentioned Dubai as an increasingly formidable competitor. That of course was not an election year.
If Democrats won't believe futures traders, maybe they'll heed their biggest political funder. When Senator Cantwell invited hedge-fund billionaire George Soros to testify last week, she probably didn't expect the backer of left-wing causes to deviate from her market-manipulation narrative. But among other things, Mr. Soros noted that "Regulations may have unintended, adverse consequences. For instance, they may push investors further into unregulated markets which are less transparent and offer less protection."
Democrats will find that moving jobs to Dubai from New York and Chicago will not end the commodity inflation that they themselves have helped to create.
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This is crazy. The government should be taking over the oil companies? From the same bozos who are the reason we are in this mess by keeping the oil companies from getting us the oil we need:
http://www.foxnews.com/urgent_queue/index.html#a54ef44,2008-06-18
Yes the government should take over the oil industry and now convert hundreds of thousands of employees onto the Federal dole making them all into Democrat drones. Like most teachers and most other government employees. How convenient. Nothing like creating a whole sub nation within a nation whose interests lie in maintaining and expanding government to protect their jobs. Just another way of bribery for votes. McCain has got to stop this. We are no longer a *free* country. I can't believe the founders wanted this.
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The 'Idle' Oil Field Fallacy
By RED CAVANEY
June 20, 2008; Page A13
A bill introduced in Congress this week would "compel" oil and natural gas companies to produce from federal lands they are leasing. If only it were that easy to find and produce oil. Imagine, an act of Congress that could do what geology could not.
These lawmakers ask why oil and gas companies want more access to federal lands to drill if they aren't using all of the 68 million acres they already have? Anyone with even the most basic understanding of how oil and natural gas are produced – and this should include many members of Congress – knows that claims of "idle" leases are a diversionary feint.
A company bids for and buys a lease because it believes there is a possibility that it may yield enough oil or natural gas to make the cost of the lease, and the costs of exploration and production, commercially viable. The U.S. government received $3.7 billion from company bids in a single lease sale in March 2008.
However, until the actual exploration is complete, a company does not know whether the lease will be productive. If, through exploration, it finds there is no oil or natural gas underneath a lease – or that there is not enough to justify the tremendous investment required to bring it to the surface – the company cuts its losses by moving on to more promising leases. Yet it continues to pay rent on the lease, atop a leasing bonus fee.
In addition, if the company does not develop the lease within a certain period of time, it must return it to the federal government, forfeiting all its costs. All during this active exploration and evaluation phase, however, the lease is listed as "nonproducing."
Obviously, companies want to start producing from active fields as soon as possible. However, there are a number of time-consuming steps to be taken before they can do so: Delineation wells must be drilled to size the field, government permits must be obtained, and complex production facilities must be engineered and installed. All this takes considerable time, and during that time, the lease is also listed as "nonproducing."
Because a lease is not producing, critics tag it as "idle" when, in reality, it is typically being actively explored and developed. Multiply these real-world circumstances by hundreds or thousands of leases, and you end up with the seemingly damning but inaccurate figures our critics cite.
Our companies have made tremendous strides in developing cutting-edge exploration technology. But they are not magicians. They cannot produce oil or natural gas where it does not exist. A significant percentage of federal leases simply may not contain oil and natural gas, especially in commercial quantities.
As I've often said, the first step in our business is called "exploration" for a reason. Exploration is time consuming, very costly and involves a great deal of risk. Importantly, you see neither a drop of usable oil nor a cubic foot of natural gas while it is going on. But it is absolutely essential, and there is nothing "idle" about it. Without the exploration that took place years ago, less domestic oil and natural gas would be available today to meet consumer demand.
In reality, a lease is simply a block on a map, with no guarantee that it contains any resources. If all of them did, one could simply pay for the lease, haul in equipment and start pumping oil. But that only happens in fiction.
And it happens in the minds of those who use the undeveloped-lease argument as a smokescreen to mask their intent to keep America's vast energy resources locked up underground, despite increasingly strong consumer demand for oil and natural gas. For exploration to take place, our companies need access to the areas – offshore and onshore – that we know have the potential to produce the oil and natural gas consumers will need, if ours is to remain a viable economy in an increasingly competitive global marketplace.
Today's short-term need was yesterday's long-term opportunity. If Congress had acted on that opportunity years ago, America would not be in the energy bind it finds itself in today. Working with industry, Congress now has the opportunity to help secure America's energy future. It should not miss the chance again.
Mr. Cavaney is president and CEO of the American Petroleum Institute, the trade association that represents America's oil and natural gas industry.
See all of today's editorials and
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Perhaps they just love the US. :wink:
I really got ask - what did W give up for this? I really got ask if the Saudis got nuclear technology for this. Any journalists looking at this. Something went on behind the scenes we don't know about.
***Saudi Arabia Boosts Oil Supply, May Pump More Later (Update2)
By Ayesha Daya and Glen Carey
June 22 (Bloomberg) -- Saudi Arabia may raise its oil production beyond a planned 200,000 barrel-a-day increase in July if the oil market requires extra supply, Saudi Oil Minister Ali al-Naimi told consumers at a summit in Jeddah.
Saudi Arabia's commitment to government and business leaders to pump 9.7 million barrels a day next month came after crude rose to a record $139.89 in New York on June 16. Saudi King Abdullah said at today's summit that his country, the world's biggest oil exporter, seeks ``reasonable'' prices. OPEC President Chakib Khelil said a Saudi boost is ``illogical'' because refiners don't need more crude.
The International Energy Agency estimates that world oil use this year will climb 800,000 barrels a day, or 1 percent, as demand climbs in emerging markets. Stagnating production from Russia and the North Sea and disruption in Nigeria are also contributing to higher prices, which have touched off strikes, riots and accelerating inflation in nations around the world.
``Saudi Arabia is prepared and willing to produce additional barrels of crude above and beyond the 9.7 million barrels per day, which we plan to produce during the month of July, if demand for such quantities materializes and our customers tell us they are needed,'' Naimi said.
Saudi Arabia's capacity will be 12.5 million barrels a day by the end of 2009 and may rise to 15 million after that if necessary, he said.
Speculators Blamed
The president of the Organization of Petroleum Exporting Countries, Khelil, blamed $135 oil on speculative investors, the subprime credit crisis and geopolitics, rather than a shortage of supply. Khelil, who is also Algeria's oil minister, today dismissed the argument voiced by consuming nations that possible supply shortages are driving up prices.
``The concern over future oil supply is not a new phenomenon,'' he told reporters in Jeddah. Asked if oil prices would fall after the meeting, he replied: ``I don't think so.''
More than 35 countries, seven international organizations and 25 oil companies took part in today's summit in the Saudi Red Sea port, including U.K. Prime Minister Gordon Brown, U.S. Energy Secretary Samuel Bodman and Exxon Mobil Corp. Chief Executive Officer Rex Tillerson.
OPEC Divided
The Saudi King and other producer-nation officials including Kuwaiti oil minister Mohammed al-Olaim also called for greater regulation on oil market investors. The U.S. Commodity Futures Trading Commission is currently investigating the role of index-fund investors in the doubling of oil prices during the past year.
OPEC itself is divided. While Saudi Arabia is boosting output, other OPEC members including Libya, Algeria, Iran, Venezuela and Qatar are opposed to higher production, saying refiners aren't asking for more crude.
Libya's top oil official, Shokri Ghanem, said after the meeting ended that the Saudi output boost wouldn't affect the oil price, and yesterday said his country may have to cut its own production in response to the Saudi move.
Venezuelan Oil Minister Rafael Ramirez, also asked whether the oil price was likely to fall after the Saudi move, said: ``I don't think so because it's not a problem of supply.''
Kuwait, OPEC's fourth largest producer, said it's ready to join neighboring Saudi Arabia and raise output, if needed.
Dollar Hedge
Oil rose to $139.89 a barrel on June 16 as investors bought commodities to hedge against a weakening U.S. dollar and concern mounted that demand is growing faster than supply. Gasoline retail prices over $4 a gallon in the U.S. are raising concern that the economy may slip into recession. Crude oil for July delivery closed June 20 in New York at $134.62 a barrel.
U.S. Energy Secretary Bodman rejected calls to put greater control on markets, and said a shortage of supply was responsible for high prices. He disputed the view that speculators are leading the markets to record levels.
The market needs between 3 million and 4 million barrels a day of spare oil production capacity, compared with the 2 million barrels a day currently available, Bodman said. OPEC says the world's spare capacity is about 3 million barrels a day, with two-thirds of that in Saudi Arabia.
``Market fundamentals show us that production has not kept pace with growing demand for oil resulting in increasing, and increasingly volatile, prices,'' Bodman said in a speech today.
More Supply
Italy's Minister of Industry Claudio Scajola and Brazil's Energy Minister Edison Lobao were among consumer-nation officials attending the Jeddah summit that said more supply was needed to ease prices. ``We expect Saudi Arabia to open the taps,'' Austrian Economy Minister Martin Bartenstein said in an interview two days ago. ``One third of inflation in the euro zone comes from energy and inflation is now of importance.''
Speaking in Jeddah today, the Austrian minister said: ``We would like to see more oil on the market. That is the only action I can think of that can discourage the speculators.''
Adam Sieminski, chief energy economist at Deutsche Bank AG, and other analysts maintain that consumers will need to curtail demand before prices head lower. The biggest drop in prices in 11 weeks came on June 18, after the world's second-biggest oil consumer, China, raised gasoline, diesel and power prices to rein in energy use.
Saudi Arabia will increase production capacity to 12.5 million barrels a day of oil by the end of next year and could add a further 2.5 million barrels a day if needed, from some new giant fields, Naimi said.
Zuluf, Shaybah Fields
``The Saudi announcement of a possible increase in capacity to 15 million barrels a day is a robust statement; it would be a huge increase,'' ENI SpA Chief Executive Officer Paolo Scaroni said in an interview in Jeddah today. ``The world is worried about the shortage in spare capacity and any improvement will change this sentiment.''
The further daily capacity includes 900,000 barrels from the Zuluf field, 700,000 barrels from Safaniyah, 300,000 barrels from Berri, 300,000 barrels from Khurais and 250,000 barrels from Shaybah, Naimi said.
U.K. Prime Minister Brown said in Jeddah today he will open Britain's energy industry to investment from oil producing nations as a way of keeping a lid on crude prices and paying for measures to clean up the environment. Further talks may be held between producers and consumers this year in London, he said.
To contact the reporters on this story: Ayesha Daya in Jeddah adaya1@bloomberg.netGlen Carey in Jeddah gcarey8@bloomberg.net
Last Updated: June 22, 2008 12:12 EDT
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http://economictimes.indiatimes.com/articleshow/msid-3190779,prtpage-1.cms
World oil market in fear of terror attack in Saudi Arabia
3 Jul, 2008, 0812 hrs IST, AGENCIES
PARIS: An attack -- or even an attempted attack -- by Islamic extremists on Saudi Arabia's oil sector would have disastrous consequences on the world market and the price per barrel, analysts warn.
Of more than 700 people arrested in the course of the last six months in Saudi Arabia, dozens had been part of cells charged with preparing attacks against oil sites, according to authorities in Riyadh.
With the price per barrel rising constantly and the capacity to increase global production almost non-existent, apart from in Saudi Arabia, the world market has never been so vulnerable to an offensive by Jihadists in the kingdom, they said.
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Michael Klare, head of the University of Massachusetts's peace and world security programme and author of the book "Resource Wars", said that even if an attack caused little damage, the impact would still be enormous.
"There would be a tremendous psychological effect because the market is already prepared to expect terrorist events like this. It would have an immediate effect on prices," he said.
"And if an attack actually damaged production or exploration, the effect would be even greater. The rise would be astronomical," he added.
Klare believes that a less significant attack would result in a price hike of no more than ten dollars a barrel.
"(But) if they managed to destroy a major refinery or a major loading facility and cut production that would have a dramatic impact. Prices would go to 200 dollars a barrel," he said.
The Saudi oil sector, which spends considerable sums on security, has been an Al-Qaeda target for years.
Osama bin Laden in December 2004 called on followers in an audio message to "aim your operations at oil production in Iraq and in the Gulf."
In February 2006 assailants using two booby-trapped cars tried to enter the huge Abqaiq complex, the biggest in the world, in the east of the kingdom.
When challenged they detonated the explosives, killing themselves and two guards.
Francis Perrin, editor-in-chief of Arab Oil and Gas magazine, said the current price of oil revealed the concern over the fragility of world supplies and the danger that in future supply will no longer satisfy demand.
"In such a context, an attack against oil installations in Saudi Arabia would have a considerable impact," he said, adding that Saudi Arabia played a unique role in the world market which was on a "knife-edge."
"It is the country possessing a bit less than a quarter of the reserves, it is the leader at the heart of OPEC (the Organization of Petroleum Exporting Countries), the number one in terms of unused capacity... It's the only country in the world of capable of producing more in the short term, in weeks," he said.
If an attack was carried out against minor installations, the impact would be significant, he said. But if an attack succeeded against more important installations, "the effect would be absolutely incalculable in terms of price," added Perrin.
Against this background Israeli threats of an air offensive against Iranian nuclear installations only add to the market's nervousness, said Klare.
"If such an attack is conducted, I think the Iranians will try to engineer terrorist attacks in Saudi Arabia, Kuwait, and Bahrain. They would do everything they can to create chaos in the international oil market... Prices would skyrocket," he said.
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http://www.centerforsecuritypolicy.org/Home.aspx?CategoryID=132&SubCategoryID=137
Set America Free
CSP Decision Brief | May 19, 2008
by Frank J. Gaffney, Jr.
Q. What do the following recent events have in common?
The President of the United States has prostrated himself for the second time in five months before the King of Saudi Arabia, pleading for more oil. Despite Mr. Bush’s inducements – an array of advanced, offensive arms; the promise of nuclear technology with which the Saudis can expect (like the North Koreans, Iranians, Pakistanis, etc.) to acquire the ultimate weapons; and U.S. help securing Saudi Arabia’s borders (something the President has declined to do at home) – the American plea was spurned. The contempt felt by the House of Saud was captured in its oil minister’s quip, “If you want more oil, buy it.”
The Senate rejected, by a vote of 56-42, an initiative offered by Republicans that called for opening the Arctic National Wildlife Refuge (ANWR) in Alaska and some offshore waters now closed to exploration and exploitation of their substantial oil reserves.
In addition, that chamber’s appropriations committee refused by a similar party-line vote to lift its moratorium on oil-shale production in Colorado. It seems that, if we want more oil, we will have to buy it at ever increasing prices from the Saudis and others even more unfriendly to this country’s national security and economic interests – like Venzuela’s Hugo Chavez or Russia’s Vladimir Putin, perhaps even Iran’s Mahmud Ahmadinejad.
One thing the Senate and House did agree upon, by overwhelmingly bipartisan majorities, was suspending purchases of oil to fill the remaining three percent of the capacity of the Strategic Petroleum Reserves. This action will have negligible (if any) impact on energy prices. But it will ensure that less oil will be available to us than would otherwise have been the case in the event, for example, the next terrorist attack on the Saudi oil infrastructure succeeds where others have failed and seriously disrupts world supplies.
Then there is the newly formed coalition, ostensibly spearheaded by the Grocery Manufacturers’ Association, that has launched a multi-million dollar lobbying effort aimed at discouraging the development of one alternative to oil: domestically produced or imported ethanol. Wrongly asserting that producing this transportation fuel from corn is largely responsible for rising food prices and the attendant global shortages, this instant grassroots (read, “astroturf”) coalition appears to want America to remain essentially dependent on oil. Wonder where the money for this campaign is coming from?
A. These actions – taken against the backdrop of soaring energy prices and the attendant hemorrhage of U.S. petrodollars to, among others, people who wish us ill – represent the sort of behavior in which only a nation utterly unserious about energy security could indulge.
The truth of the matter is that, no matter what we do, we are going to need oil for the foreseeable future. As a result, we should do our utmost to find it and exploit it in places that are either under our control (for example, near where the Cubans and Chinese are getting it off the coast of Florida) or at least friendly to us (notably, Canada, Mexico and Brazil).
It is equally axiomatic that, no matter what we do, we are almost certainly going to have less oil than we need, certainly at prices we can afford. The question is: Are we going to do something to meet the shortfall? Or are we simply going to allow the economy and security of the United States to bleed-out at the hands of the Saudi-led OPEC cartel?
The Set America Free Coalition – an initiative launched several years ago by unlikely array of national security-, environmental- and energy-minded people and organizations from across the political spectrum – is advancing practical, near-term alternatives to that unappetizing and unacceptable prospect.
At the moment, the Coalition is mounting its own campaign aimed at achieving in the immediate future, a simple yet far-reaching goal: Ensuring that each of the 17 million new cars added to America’s highways each year is capable of being powered by ethanol (from whatever source), methanol (ditto) or gasoline (or some combination thereof).
There are already some 6 million of these Flexible Fuel Vehicles (FFVs) on our roads today. Most of these are American-made (name another technology in which Detroit has a competitive advantage?) It costs less than $100 per car to equip new cars with this feature.
Ask yourself, and your elected representatives and would-be Presidents: As each of these cars will last, on average, roughly 17 years, do we want any more of them to be built the old way – namely able to use only gasoline? Can we responsibly continue for another generation to lock our transportation sector (the principal, and most profligate, consumer of imported oil) into dependence on oil substantially imported from unfriendly places?
Dr. Robert Zubrin – a leader of the Set America Free Coalition and author of the terrific new book, Energy Victory: Winning the War on Terror by Breaking Free of Oil – observes that at today’s oil prices, we are allowing the Saudis and their friends to impose the equivalent of a 40 percent income tax at a cost of approximately $3300 on every man woman and child in this country. We literally cannot afford to allow such lunacy to continue.
Sooner or later, Congress will adopt an Open Fuel Standard requiring every new car sold in America to be an FFV. The effect will be, in short order, to create an immense and highly competitive market for alternative, “Freedom Fuels” that we can make here or buy from friends. That, in turn, will set America free by beginning to end its cars’ present addiction to oil. Why wait any longer?
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http://www.setamericafree.org/blueprint.pdf
Energy security is national security.
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- Pajamas Media - http://pajamasmedia.com -
Iran Wielding ‘Soft Power’ Against America
July 4, 2008 - by Lee Smith
“If each Muslim throws a bucket of water on Israel,” said the late Ayatollah Khomeini, “Israel will be erased.” This immortal sentiment, and surreal image, captures the essence of the Islamic Republic of Iran’s public diplomacy campaign these last four years, one of the most effective uses of “soft power” in recent memory.
President Mahmoud Ahmadinejad’s threats to destroy Israel have so captured the hearts and minds of the Arab masses that they are too distracted to understand that the Persians are primarily coming after them. And the princes and presidents-for-life who rule the Arabs dare not speak the truth since they have promised for sixty years now to rectify the historical error that led to the establishment of the Zionist entity. With the reflexive Arab humiliation at the failure to annihilate a UN member state, the Khomeinists offer at least hope: if you can’t throw Israel into the sea, then take the sea to Israel — and bring your bucket.
So, while Ahmadinejad — the regime’s dark sorcerer, carny barker, and bearded lady rolled into one — has talked of making Israel disappear, he has effectively dropped his cloak over the rest of the Middle East to hide it from view. Even Washington doesn’t seem to have noticed that Iran has pulled a three-card monte trick with a vital American interest — the Persian Gulf.
To be sure, Ahmadinejad is a messianic obscurantist whose vicious threats should not be taken lightly. But Israel is not the main issue here, nor for that matter is the regime’s nascent nuclear program. For these are merely aspects, albeit important ones, of Iran’s project for the entire Middle East, a revolutionary putsch against the established order. And since Washington for over half a century has underwritten that order, from the eastern Mediterranean to the Persian Gulf, which Martin Kramer has called an “[1] American lake,” the Iranian project by definition means to drive the U.S. from the region. And that’s the main event: not Israel, which has a nuclear deterrent, but the Gulf Arabs, who don’t, and their oil, a vital American interest.
Just as it would be ignoble for the world’s superpower to [2] assign an attack on Iran’s nuclear program to the Israelis, neither should Washington leave it up to Israel to counter Ahmadinejad’s rhetorical onslaught. It is the prerogative of a superpower to formulate strategy, tasks that Washington has so far botched. Consider Annapolis, Secretary of State Condoleezza Rice’s redundant effort to convince the Arabs and Israelis of the obvious — that they have a common foe in Iran — and then reward Arab inaction by demanding concessions from Israel on the peace process.
Not surprisingly, the Israelis are confused and frustrated and the Arabs are hardly more impressed. Indeed Arab regime confidence in Washington’s ability to stop the Iranians seems to be at an all-time low. Four years ago U.S. ally King Abdullah of Jordan was stirring up the sectarian hornet’s nest by warning of a Shia crescent; today Saudi Arabia’s King Abdullah is hosting unprecedentedly Shia-friendly interfaith conferences in order to pave the way for an accommodation between the Sunnis and those who are awaiting the return of the twelfth imam, a comity that does not need Washington as a guarantor.
And there is no American clarity on the horizon either, for so far neither U.S. presidential candidate has indicated that he will be any more effective than the Bush administration.
Senator Obama says that he’s the man who would speak with the Iranians — apparently ignorant of the fact that every man who has sat in the Oval Office since the 1979 takeover of the U.S. embassy in Tehran has tried to engage the IRI. While this puerile boast richly merits the derision of his opponents, the fact is that Senator McCain has not shown that his Iran policy consists of much more than proving that he is a steadfast friend of Israel. Is it possible that the two men running for this country’s highest office do not know what is at stake?
Perhaps, but it seems likely that policymakers won’t talk about Gulf energy resources because it is one place where the Republicans are as vulnerable as the Democrats are to the inanities of the left. What can the slogan “no blood for oil” possibly mean in the real world? That we won’t lift a finger to ensure that foodstuffs and other essential items are moved in a timely and inexpensive manner from one part of this large country to another? That we’ll just roll over and play dead if our geographic and therefore our social mobility is circumscribed by fuel prices set by Iran? That we won’t fight at all since the fact that all of American life, society, culture, and commerce is organized around the free flow of the affordable energy resources that also sustain global markets is of absolutely no consequence to those of pure conscience?
The question then is not what the next president of the United States intends to do about Iran, but which candidate will treat the American electorate like adults and speak plainly, maybe something like this:
“We have been at war for over five years now with one goal of our fight being to bring freedom to other nations and peoples around the world. But now it is time to speak of our freedoms and our way of life, and how we intend to preserve them.
“I would not be running for this office if I did not have full faith and confidence not only in the strength and resilience of the American people but also in our native genius and creative energy, a living tradition that you and I must stand in awe of as it reaches from Bill Gates back to Benjamin Franklin and thus ties us to our roots in our forefathers, the founders of our great nation. This is our vivid legacy and thus I have no doubt that in due course we will develop a reliable and affordable substitute for fossil fuels. Who knows but that inventors are not already on the verge of a breakthrough? But perhaps we are not so close; maybe the talent who will usher in a new age of cheap and clean energy has just gone off to summer camp with her friends — in a school bus consuming diesel fuel at more than $5 a gallon. That is to say, there are yet harder times ahead for all of us, and surely some will only find warm consolation in the prospect of our children reaping the great benefits of their parents’ courageous sacrifice in relinquishing our position in the Persian Gulf.
“That, my fellow Americans, is one option before us. The other is to do whatever it takes to secure and sustain the privilege won and bargained for by President Franklin D. Roosevelt some sixty years ago and asserted and exercised by every American government since that time — our position in the Persian Gulf. This hard choice will almost certainly mean some form of military action against the Islamic Republic of Iran.”
Losing the Persian Gulf to a fanatical, terror-supporting regime that threatens all its neighbors, Israeli and Arab alike, would do untold damage to the U.S. economy and world markets; and by paving the way for nuclear proliferation in an extremely volatile part of the world where states typically use terrorist organizations to advance their strategic goals, our exit would entail a major threat to U.S. national security. The costs of relinquishing our position in the Gulf would be virtually indistinguishable from losing a world war.
Article printed from Pajamas Media: http://pajamasmedia.com
URL to article: http://pajamasmedia.com/blog/iran-wielding-soft-power-against-america/
URLs in this post:
[1] American lake: http://blogs.law.harvard.edu/mesh/2008/06/the_myth_of_linkage/
[2] assign an attack: http://blogs.law.harvard.edu/mesh/2008/06/assign_iran_to_israel/
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OK according to the left wackos we should not drill offshore because it could contaminate a "sensitive" ecosystem. So lets promote biofuels and cause food shortages and accelerate deforestation.
And then we have the Bo quack saying we should not drill offshore because we cannot "drill our way out of this" (talking point) and because that will take too long. Yet what he proposes will take far longer.
How does a Senator become rich while he is a Senator????
http://news.yahoo.com/s/ap/20080705/ap_on_re_as/asia_orangutans
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http://hotair.com/archives/2008/07/08/dems-retreat-on-energy-wait-for-the-wind/
Dems retreat on energy, “wait for the wind”
POSTED AT 10:45 AM ON JULY 8, 2008 BY ED MORRISSEY
Democrats in Congress promised to make energy policy a high priority when they returned after the Independence Day break. Instead, they have quietly scrubbed the schedule of any votes on their energy bill, afraid Republicans will make them vote on increased domestic oil production and force them to choose between popular sentiment for drilling and their environmentalist allies. Their strategy? Well, the Hill chooses a good quote:
“Right now, our strategy on gas prices is ‘Drive small cars and wait for the wind,’ ” said a Democratic aide.
Before the break, Democrats heralded two bills that supposedly showed their leadership on energy: an anti-speculator measure and a “use it or lose it” bill that forced oil companies to drill on federal leases — whether or not they had found oil yet — or lose the leases immediately. They attacked Republicans who opposed both bills as oil-company lackeys, but the truth is that neither bill produces a single drop of oil to solve the supply crisis.
Now, both bills have disappeared off of the legislative calendar, and the Republicans have ideas of their own. Politico reports that Mitch McConnell has a plan to peel off moderate Democrats in the Senate to get approval for drilling by combining the effort with conservation mandates. He already has five Democrats ready to vote for more drilling, and if he can find a few more, he can effectively sideline the Slip-Up from Searchlight and keep him from getting ill:
GOP senators believe that a number of moderate Democrats would be open to legislation that balances increased energy exploration with conservation. If they’re right, House Speaker Nancy Pelosi (D-Calif.) and Senate Majority Leader Harry Reid (D-Nev.) could lose their grip on energy policy, and the Republicans could score a major coup on the No. 1 issue on the minds of voters.
At least five Senate Democrats support more domestic oil and gas exploration, and McConnell is sweetening the deal to make the sale to other moderates: The Kentucky Republican is pushing a package of incentives to boost conservation as well as a measure creating stricter enforcement of commodities markets in exchange for more offshore oil and gas drilling.
Moderate Democrats have now begun asking for a “Gang of 14″ on energy. Ben Nelson (D-NE) has taken the lead in this demand, and he has nine other Senators from both parties willing to join him. This amounts to a rebellion against Harry Reid and his knee-jerk opposition to increased domestic production of oil and coal. His “sick” speech may have been the last straw for Democrats who see the American public demanding more domestic production and recognize the political danger that approaches in November for obstructionists.
Of course, the Democrats always have the option of going into November with the slogan, “Drive smaller cars and wait for the wind.” I’m sure we’ll see television ads and bumper stickers highlighting that strategy. Unfortunately for the Democrats, they will be produced by Republicans to demonstrate the utter bankruptcy of Democratic energy policy.
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My Plan to Escape the Grip of Foreign Oil
By T. BOONE PICKENS
July 9, 2008; Page A15
One of the benefits of being around a long time is that you get to know a lot about certain things. I'm 80 years old and I've been an oilman for almost 60 years. I've drilled more dry holes and also found more oil than just about anyone in the industry. With all my experience, I've never been as worried about our energy security as I am now. Like many of us, I ignored what was happening. Now our country faces what I believe is the most serious situation since World War II.
The problem, of course, is our growing dependence on foreign oil – it's extreme, it's dangerous, and it threatens the future of our nation.
Martin Kozlowski
Let me share a few facts: Each year we import more and more oil. In 1973, the year of the infamous oil embargo, the United States imported about 24% of our oil. In 1990, at the start of the first Gulf War, this had climbed to 42%. Today, we import almost 70% of our oil.
This is a staggering number, particularly for a country that consumes oil the way we do. The U.S. uses nearly a quarter of the world's oil, with just 4% of the population and 3% of the world's reserves. This year, we will spend almost $700 billion on imported oil, which is more than four times the annual cost of our current war in Iraq.
In fact, if we don't do anything about this problem, over the next 10 years we will spend around $10 trillion importing foreign oil. That is $10 trillion leaving the U.S. and going to foreign nations, making it what I certainly believe will be the single largest transfer of wealth in human history.
Why do I believe that our dependence on foreign oil is such a danger to our country? Put simply, our economic engine is now 70% dependent on the energy resources of other countries, their good judgment, and most importantly, their good will toward us. Foreign oil is at the intersection of America's three most important issues: the economy, the environment and our national security. We need an energy plan that maps out how we're going to work our way out of this mess. I think I have such a plan.
Consider this: The world produces about 85 million barrels of oil a day, but global demand now tops 86 million barrels a day. And despite three years of record price increases, world oil production has declined every year since 2005. Meanwhile, the demand for oil will only increase as growing economies in countries like India and China gear up for enhanced oil consumption.
Add to this the fact that in many countries, including China, the government has a great deal of influence over its energy industry, allowing these countries to set strategic direction easily and pay whatever price is needed to secure oil. The U.S. has no similar policy, because we thankfully don't have state-controlled energy companies. But that doesn't mean we can't set goals and develop an energy policy that will overcome our addiction to foreign oil. I have a clear goal in mind with my plan. I want to reduce America's foreign oil imports by more than one-third in the next five to 10 years.
How will we do it? We'll start with wind power. Wind is 100% domestic, it is 100% renewable and it is 100% clean. Did you know that the midsection of this country, that stretch of land that starts in West Texas and reaches all the way up to the border with Canada, is called the "Saudi Arabia of the Wind"? It gets that name because we have the greatest wind reserves in the world. In 2008, the Department of Energy issued a study that stated that the U.S. has the capacity to generate 20% of its electricity supply from wind by 2030. I think we can do this or even more, but we must do it quicker.
My plan calls for taking the energy generated by wind and using it to replace a significant percentage of the natural gas that is now being used to fuel our power plants. Today, natural gas accounts for about 22% of our electricity generation in the U.S. We can use new wind capacity to free up the natural gas for use as a transportation fuel. That would displace more than one-third of our foreign oil imports. Natural gas is the only domestic energy of size that can be used to replace oil used for transportation, and it is abundant in the U.S. It is cheap and it is clean. With eight million natural-gas-powered vehicles on the road world-wide, the technology already exists to rapidly build out fleets of trucks, buses and even cars using natural gas as a fuel. Of these eight million vehicles, the U.S. has a paltry 150,000 right now. We can and should do so much more to build our fleet of natural-gas-powered vehicles.
I believe this plan will be the perfect bridge to the future, affording us the time to develop new technologies and a new perspective on our energy use. In addition to the plan I have proposed, I also want to see us explore all avenues and every energy alternative, from more R&D into batteries and fuel cells to development of solar, ethanol and biomass to more conservation. Drilling in the outer continental shelf should be considered as well, as we need to look at all options, recognizing that there is no silver bullet.
I believe my plan can be accomplished within 10 years if this country takes decisive and bold steps immediately. This plan dramatically reduces our dependence on foreign oil and lowers the cost of transportation. It invests in the heartland, creating thousands of new jobs. It substantially reduces America's carbon footprint and uses existing, proven technology. It will be accomplished solely through private investment with no new consumer or corporate taxes or government regulation. It will build a bridge to the future, giving us the time to develop new technologies.
The future begins as soon as Congress and the president act. The government must mandate the formation of wind and solar transmission corridors, and renew the subsidies for economic and alternative energy development in areas where the wind and sun are abundant. I am also calling for a monthly progress report on the reduction in foreign oil imports, as well as a monthly progress report on the state of development of natural gas vehicles in this country.
We have a golden opportunity in this election year to form bipartisan support for this plan. We have the grit and fortitude to shoulder the responsibility of change when our country's future is at stake, as Americans have proven repeatedly throughout this nation's history.
We need action. Now.
Mr. Pickens is CEO of BP Capital.
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How Free Trade Can Help Solve the Energy Crisis
By ROBERT MCFARLANE and GEORGE PHILIPPIDIS
July 26, 2008; Page A9
The unprecedented escalation in oil and food prices is a clear and present danger to our economy and national security. The root cause of this crisis is our dependence on a single commodity, oil, for transportation -- we burn 145 billion gallons of gasoline a year. The only permanent solution is diversity in our fuel supply to ensure competition and choice in the marketplace.
While a number of alternatives to oil are being developed, we already have one strategic solution at our disposal: biofuels, both domestic and from Latin America.
Biofuels like ethanol and biodiesel are cheaper than fossil fuels, and will become even cheaper if we eliminate the senseless tariff on ethanol imports from Brazil. Ethanol can be used safely as a 10% blend with gasoline in all existing cars, and as an 85% blend in the increasing number of flexible-fuel cars on our roads. That means a 10% to 85% potential drop in gasoline use and, hence, freedom from the oil stranglehold.
The public has been bombarded with lies and half-truths about biofuels, especially in the last six months. Americans should realize that biofuels are superior to fossil fuels. Biofuels are renewable, nontoxic and biodegradable. They are also beneficial to the automobile engine, the environment and the economy.
Biofuels are available today by the billions of gallons from a variety of sources: corn, sugarcane and soon from cellulosics. Cellulosic ethanol promises to dramatically boost domestic production in the near future. In the meantime, sugarcane ethanol already produced in Latin American sugar mills can become a key U.S. fuel supply.
Cellulosic biomass, in the form of existing agricultural and wood waste, is abundant (over a billion tons annually), inexpensive and requires no additional land. It has no food or feed value and therefore no effect on food availability and prices. A number of technologies are pursued for production of cellulosic ethanol and other biofuels, such as butanol and biodiesel. Most likely there will be no single technology winner. Rather, technologies will be adapted to the particular characteristics of local biofuel feedstocks.
Lower fuel prices will come only with an ample supply of alternative fuels. Cellulosic ethanol can extend corn ethanol's potential of 15 billion gallons per year, but it will not happen overnight. Resolving commercialization issues, building a large number of plants, and ramping up cellulosic ethanol production to billions of gallons will require a number of years.
To quickly boost its biofuel supply, the U.S. should partner with Latin America. Sugarcane ethanol from Brazil, Colombia, Peru and Central America should become an integral part of the U.S. energy strategy. An increase in Latin American cane ethanol capacity is the fastest, most cost-effective and lowest-risk strategy to secure abundant ethanol fuel. The U.S. needs Latin America for energy security, and Latin America needs the U.S. for capital and technology infusion. It's a classic win-win partnership -- provided U.S. trade barriers to sugarcane ethanol are eliminated.
Biofuel production is sustainable. The U.S. corn ethanol industry is investing in technology improvements to reduce land demand through higher productivity and to minimize its carbon footprint. Cellulosic ethanol will come from existing waste materials, not additional land.
Still, both corn and cellulosic ethanol can learn sustainable business lessons from Brazil. Its sugar mills have become biorefineries that co-produce sugar, ethanol and electricity in a renewable fashion, thus satisfying food, fuel and energy needs at the same time. The plants are self-powered by renewable energy derived from cane fiber and other biomass. As a result, Brazilian ethanol today is cost-competitive with oil at just $70 a barrel ($45 a barrel before the dollar weakened) without government subsidies -- a significant price advantage over gasoline.
The U.S. should immediately pursue a multifaceted biofuels strategy. First, while the corn industry improves productivity and sustainability, the U.S. should treat the commercialization of cellulosic technologies as a matter of national security -- a new Manhattan Project deserving all the necessary resources to accelerate deployment.
Second, the U.S. should pursue closer energy integration with Latin America though regulatory convergence and open biofuels trade, thus encouraging private investment in sugarcane ethanol production. This is the fastest and most efficient means to boost ethanol availability within three to four years, and displace gasoline use to an extent significant enough to cause oil demand and prices to drop.
Third, consumers should be educated and financially incentivized to switch to flexible-fuel vehicles, creating demand for mass production of such vehicles, which will dramatically cut U.S. dependence on foreign oil.
Energy security can not be achieved with a silver bullet. It is not a competition between corn ethanol and sugarcane ethanol or between biofuels and plug-in hybrids. The sooner we realize that U.S. energy security needs all of the above, the sooner our country will be able to commit to a coherent long-term energy policy. U.S. and Latin American biofuels are the kick-start needed to break oil's unbearable monopoly in transportation fuels.
Mr. McFarlane served as President Ronald Reagan's national security advisor (1983-85). Mr. Philippidis is energy director at Florida International University in Miami.
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This week in Washington, House Republicans will try to produce a little political heat from rising energy prices. They will attempt to block Congress from adjourning for its summer recess if Democrats don’t allow an up or down vote on the GOP energy plan, which includes expanded drilling in the Outer Continental Shelf (OCS). House procedures -- which heavily favor the majority party -- will allow the Democrats to thwart those efforts, but Republicans can claim the issue: Congress will leave town without an up or down vote on expanded OCS drilling. Republicans hope movement in public opinion in favor of offshore drilling, spurred by record gasoline prices, will produce a new and effective line of political attack.
The GOP hypothesis draws some support in at least one Senate race. Former Republican Congressman Bob Schaffer has made progress in his contest against U.S. Rep. Mark Udall in Colorado, according to the most recent polling. What accounts for the GOP’s recent improvement? It’s gasoline prices – and more specifically, the stark differences between the two candidates on drilling policies. Voters apparently now see a much clearer connection between extreme environmental policies – like banning all offshore drilling – and pain at the pump. The last two independent polls show the race moving from about a 10-point Udall advantage to a near dead heat.
The Rasmussen numbers show a particularly strong shift among swing voters: “Among unaffiliated voters, Udall leads by just four percentage points. A month ago, he held a twenty-one point lead among these voters." You can read the full Rasmussen Colorado poll report here.
This piece in today’s Washington Times underscores how Republican Schaffer has transformed his support for drilling from a political liability to an electoral asset.
Record gasoline prices linked with what House Republican leader John Boehner calls the “Drill Nothing Congress” could fuel the political engines of many Republican congressional candidates this fall.
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With the drop in oil, i'm worried the public will drift back into complacency on this issue.
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http://www.cato.org/pub_display.php?pub_id=9591
Oil and Oily Politicians
by Richard W. Rahn
Richard W. Rahn is a senior fellow at the Cato Institute and chairman of the Institute for Global Economic Growth.
Added to cato.org on August 14, 2008
If you had to bet whether the price of oil would be higher or lower 10 years in the future, what would you say?
Some argue that the world is running out of low-cost oil and that oil prices will get higher and higher. Others argue that the current high price of oil will
cause a flood of new oil, much of it from nonconventional sources; hence, prices will fall significantly (provided the political class in Washington, D.C.,
does not continue its energy and environmental death march policies).
The case for much lower oil prices is as follows. There are hundreds of years of oil supplies (at present and projected consumption levels) if oil in oil
sands and shale is properly included in reserves. In some places, such as Saudi Arabia and Iraq, there is still much low-cost oil ($15 a barrel or even
less) that can be produced for decades, but not in an amount sufficient to meet the world's demand; hence, much higher-cost oil is also pumped. This
higher-cost oil includes much of the offshore oil (the huge cost of the mammoth drilling rigs has to be amortized over each barrel of oil produced) and
on-shore oil in hard-to-reach places and/or produced from low-production wells.
Oil reserves are largely a function of price. Global proven reserves of conventional oil obtainable at prices of less than $40 per barrel are estimated at
more than 1.3 trillion barrels, with much of it concentrated in the Middle East. Additionally, reserves of so called "heavy oil," the largest reserves of
which are in Venezuela's Orinoco area, are estimated at 1.2 trillion barrels, and most of this could probably be recovered for less than $50 per barrel.
The reserves of oil sands, which are actively being mined in Canada's Alberta Province, are estimated to be 1.8 trillion barrels. Experts estimate that
much of this can be produced for $45 per barrel or less. Global reserves of oil shale are estimated at more than 3.3 trillion barrels, with 70 percent in the
United States (primarily in Colorado, Utah and Wyoming).
Shell Oil Co. last year announced it has developed a process for extracting the oil from the shale, without mining, at a price of roughly $35 per barrel.
The United States also has the world's largest reserves of coal — enough for hundreds of years of production at present levels. Coal also can be turned
into liquid petroleum (as the Germans and South Africans proved decades ago). Current estimates of the conversion cost are as low as $35 per barrel.
Does it seem a bit odd that the current price of oil is more than twice the cost of producing all the oil the world presently needs and will need long into
the future? The reason the price is so high is that the supply has been artificially constrained by governments. Most (88 percent) of the conventional oil
reserves are owned by governments, and these governments have underinvested in new production. As is well-known, the U.S. government has
restricted offshore and onshore drilling, shale development, and coal conversion.
Some politicians argue, even if the U.S. government started to allow increased production, that it would be seven to 10 years or more before there would
be additional output. This is nonsense. Oil wells can be drilled at an average rate of 1,000 feet or so per day, which means that the average U.S. well can
be drilled in a week. It does take a few weeks to set up the pump and install the separation tanks, etc., but new land wells can be producing within
months, even if the product has to be trucked rather than piped away.
Drilling in the Arctic National Wildlife Refuge in Alaska would not take all that long for some production to get started. Politicians often confuse the
time it takes to get peak production from a field as compared to some production — each additional well takes time, plus the necessary new piping
collection infrastructure for each additional well.
Offshore wells do take a lot longer, but most of the time involved is the government permitting process, not the physical production of the rigs, drilling
and so forth. If the government gave a full green light to production of oil shale in the Rocky Mountains, it might take several decades to reach full
production, but some production would be accomplished in the next couple of years.
The very same politicians who claim we cannot increase oil production quickly are often the same ones who tell us we need to move to alternative forms
— windmills and solar, etc. — without seeming to understand these desirable technologies will take far more time to meet the goals of "energy
independence" than ramping up oil production. Speaker of the House Nancy Pelosi said she would not allow a vote on more drilling because she wanted
"to save the planet," without seeming to understand, if increased oil production does not take place in the United States with all its environmental
safeguards, it will take place where U.S. environmental law cannot be enforced — and that is not healthy for the planet.
Fortunately, the people are beginning to understand they are paying twice more for a gallon of gasoline than is necessary, and the global environment is
not benefiting. Less expensive energy and a cleaner environment are most likely to be achieved quickly not with alternative energy sources but with an
alternative set of congressional leaders.
http://www.cato.org/pub_display.php?pub_id=9591
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Lotta links to other interesting pieces in the online article.
The Oil Price Bubble Bursts
And prices are falling a dollar a day
Ronald Bailey | November 18, 2008
Oil prices have dropped by 60 percent since July. And they fell without the benefit of a gasoline tax holiday, new anti-speculator regulations, or a windfall profits tax on oil companies. A year ago, crude oil was going for $88.00 per barrel and gasoline cost an average of $2.76 per gallon. Over the following months, the price soared, reaching an inflation-adjusted record high of just over $147 per barrel in July. Then the bottom fell out. Yesterday, the price was hovering around $58, up from a recent low of $53 per barrel. The result is gasoline prices plummeting from a national average of $4.11 per gallon in July to below $2.07 per gallon now. So what happened?
First, just as one would expect, higher prices led to lower demand. U.S. demand for petroleum in 2008 was 5.4 percent lower than in 2007, falling by 1.1 million barrels per day (bpd) from 20.7 million to 19.6 million barrels per day. As prices rose Americans curtailed their driving. The Federal Highway Administration reported that in August 2008, Americans drove 15 billion fewer miles, or 5.6 percent less, than they did in August 2007. On the other hand, recent high prices have called forth new sources of supply. For example, Canadian oil sands now produce 1.1 million barrels per day. And new deepwater offshore production rigs like the Thunder Horse (250,000 barrels per day) and Tahiti (125,000 barrels per day) platforms are coming online. Falling demand and increasing supply mean lower prices.
In addition, a good portion of the lower demand for oil is the result of the global economic slowdown. "This time the usual petroleum boom/bust cycle lined up on top of the business cycle," said Tim Evans, an energy futures analyst at Citigroup's Futures Perspective. In March 2008, Evans warned that we were in the midst of a bubble and that oil prices would drop. When the investment firm Goldman Sachs suggested the possibility of $200 per barrel oil, Evans predicted that prices would fall to $60 to $70 per barrel. He observed presciently that "this is the riskiest time to be long in crude oil since 1980."
So as prices drop will demand increase? Yes, but Evans believes that U.S. demand will rise slowly. Why? In part because various federal government policy responses to recent high oil prices are unlikely to be reversed. For example, the Federal government has mandated that Corporate Average Fuel Economy standards for automobiles rise from 27.5 miles per gallon now to 35 miles per gallon by 2020. Evans thinks that hybrid automobile technology may look economically attractive even at current prices. Plug-in hybrids like the Chevy Volt should use about 2 cents of electricity per mile compared to 12 cents per mile of gasoline. In addition, Evans says, "The biofuels initiatives aren't going to go away. Even if they are not economically smart, the votes are there to make sure that we stick with these programs." So subsidized biofuels will displace some demand for gasoline, putting downward pressure on the price of crude oil.
On the supply side, those "windfall profits" that oil companies have been earning in the last couple of years are paying for exploration and development of more oil supplies. It is true that the oil companies have been using their record profits to buy back stock and thus increase shareholder value. Some members of Congress believe that the oil companies should spend their profits on alternative energy projects that the companies don't believe can be justified economically. And if the oil companies don't stop enriching their shareholders, Congress will see to it that the "windfall profits" are taxed away and spent by government bureaucrats on alternative energy projects. It is possible that the members of Congress know better how to spend oil company profits than do their executives, but the Federal government's record in this area is not impressive.
Naturally, suppliers don't like lower prices, so the members in the Organization of Petroleum Exporting Countries (OPEC) want to drive up prices by restricting supply. In October, OPEC members pledged to cut oil production by 1.5 million barrels per day beginning on November 1. They plan to hold another meeting later this month to discuss further reductions. Even as consumers enjoy lower prices at the gas pump now, analysts at the International Energy Agency fret that they will lead to underinvestment in oil production capacity, resulting in a crude oil supply crunch by the middle of the next decade. Disturbingly, 80 percent of the world's known oil reserves are owned by government oil companies whose revenues are looted rather than reinvested in production. In any case, lower prices and the credit crunch are already causing oil companies to shelve some projects. Alternative energy promoters also fear lower petroleum prices because they make their projects even less economically feasible. Some are advocating a higher gasoline tax in order to counteract the deleterious effects of lower crude oil prices on the glorious alternative energy future.
So what's next for oil prices? For the coming year, Evans thinks that the price of oil will bounce around in a trading range of $50 to $90 per barrel, averaging around $70 per barrel.
Ronald Bailey is reason's science correspondent. His book Liberation Biology: The Scientific and Moral Case for the Biotech Revolution is now available from Prometheus Books.
http://www.reason.com/news/show/130132.html
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This one could be filed a lot of places. The original contains a lot of links to source material:
When Does an Infant Industry Stop Needing Its Taxpayer Allowance?
Federal bioethanol subsidies are 30 years old this month. As reason has documented time after time after time after time, those subsidies to corn ethanol have had deleterious effects on the environment and the price of food around world.
(http://www.frankforpresident.org/images/cartoon.jpg)
It's way past time for the industry to stand or fall on its own economic merits. Food Before Fuel, a broad coalition of environmental, farming, taxpayer, consumer and other groups, is calling on the feds to drop counterproductive bioethanol subsidies:
“On many issues, these groups gathered here today do not see eye to eye. But we have come together because we all can agree that the government’s subsidization of the corn ethanol industry is a flawed policy that pits rural industries against one another, raises food prices for everyone and has failed to yield promised environmental benefits,” Brandenberger said.
Duane Parde, president of the National Taxpayers Union, was critical of the ethanol industry as a “demonstrative waste of taxpayer money in a time of economic hardship.”
"President-elect Obama and the 111th Congress have an opportunity to protect taxpayers and end business as usual,” Parde said. “We have spent 30 years and billions of taxpayer dollars subsidizing the production of ethanol with little to show for it. Despite the subsidies, ethanol is not competitive in the marketplace and the industry only survives because politicians shovel our money into their pockets. We must end the bailouts and subsidies for industries that are unable or unwilling to stand on their own."
Craig Cox, Midwest vice president of the Environmental Working Group, said that, "After 30 years of subsidies, ethanol is displacing only 3 percent of the gasoline we use each year, is likely increasing rather than decreasing greenhouse gas emissions, and is threatening our soil, water and wildlife. Yet ethanol gets $3 out of every $4 of tax credits the federal government gives to all renewable alternatives including wind, solar and geothermal. It is time we direct our tax dollars to renewable alternatives, including biofuels, based on how well they protect our climate, our environment and our energy security."
Jason Clay, senior vice president for market transformation at the World Wildlife Fund, noted, “In its work with local communities and habitats across the globe, the World Wildlife Fund has seen the negative impacts of the biofuel policy not only on the environment, but on vulnerable populations throughout the world.”
As Competitive Enterprise Institute senior fellow Marlo Lewis notes:
"After 30 years of government coddling, it's time for this infant industry to grow up and succeed or fail on its own merits. If ethanol is commercially viable then no government support is needed; if it is not commercially viable, no amount of government support can make it so."
Whole anti-subsidy coalition press release here.
http://www.reason.com/blog/show/130183.html
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I gather that amongst its effects is an increase in the use of fertilizer, which, inter alia, runs down the Mississippi River into the Gulf of Mexico where it greatly adds to a scarily large and growing dead zone (no oxygen) in the Gulf.
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Kinda amusing that, after the relentless drumbeat of "conserve," this item is being presented as a potential problem.
Surprise Drop in Power Use Delivers Jolt to Utilities
By REBECCA SMITH
An unexpected drop in U.S. electricity consumption has utility companies worried that the trend isn't a byproduct of the economic downturn, and could reflect a permanent shift in consumption that will require sweeping change in their industry.
Numbers are trickling in from several large utilities that show shrinking power use by households and businesses in pockets across the country. Utilities have long counted on sales growth of 1% to 2% annually in the U.S., and they created complex operating and expansion plans to meet the needs of a growing population.
"We're in a period where growth is going to be challenged," says Jim Rogers, chief executive of Duke Energy Corp. in Charlotte, N.C.
The data are early and incomplete, but if the trend persists, it could ripple through companies' earnings and compel major changes in the way utilities run their businesses. Utilities are expected to invest $1.5 trillion to $2 trillion by 2030 to modernize their electric systems and meet future needs, according to an industry-funded study by the Brattle Group. However, if electricity demand is flat or even declining, utilities must either make significant adjustments to their investment plans or run the risk of building too much capacity. That could end up burdening customers and shareholders with needless expenses.
To be sure, electricity use fluctuates with the economy and population trends. But what has executives stumped is that recent shifts appear larger than others seen previously, and they can't easily be explained by weather fluctuations. They have also penetrated the most stable group of consumers -- households.
Dick Kelly, chief executive of Xcel Energy Inc., Minneapolis, says his company, which has utilities in Colorado and Minnesota, saw home-energy use drop 3% in the period from August through September, "the first time in 40 years I've seen a decline in sales" to homes. He doesn't think foreclosures are responsible for the trend.
Duke Energy Corp.'s third-quarter electricity sales were down 5.9% in the Midwest from the year earlier, including a 9% drop among residential customers. At its utilities operating in the Carolinas, sales were down 4.3% for the three-month period ending Sept. 30 from a year earlier.
American Electric Power Co., which owns utilities operating in 11 states, saw total electricity consumption drop 3.3% in the same period from the prior year. Among residential customers, the drop was 7.2%. However, milder weather played a role.
Utility executives question whether the recent declines are primarily a function of the broader economic downturn. If that's the case, says Xcel's Mr. Kelly, then utilities should continue to build power plants, "because when we come out of the recession, demand could pick up sharply" as consumers begin to splurge again on items like big-screen televisions and other gadgets.
Some feel that the drop heralds a broader change for the industry. Mr. Rogers of Duke Energy says that even in places "where prices were flat to declining," his company still saw lower consumption. "Something fundamental is going on," he says.
Michael Morris, the chief executive of AEP, one of the country's largest utilities, says he thinks the industry should to be wary about breaking ground on expensive new projects. "The message is: be cautious about what you build because you may not have the demand" to justify the expense, he says.
Utilities are taking steps to get a better understanding of the cause. Some are asking customers who reduced usage to explain what is influencing them. Xcel and other utilities, for example, have been running environmentally focused campaigns to urge consumers to use less energy recently, a message that might be taking hold.
Power companies are also questioning the reliability of the weather-adjustment models they use to harmonize fluctuating sales from quarter to quarter. "It's more art than science," says Bill Johnson, Chief Executive of Progress Energy Inc., Raleigh, N.C.
If the sector is entering a period of lower demand -- which could accelerate further if the automotive sector collapses -- many utilities will have to change the way they cover their costs.
Utilities are taking a hard look at the way they set rates and generate profits. Many companies are embracing a new rate design based on "decoupling," in which they set prices aimed at covering the basic costs of delivery, with sales above that level being gravy. Regulators have resisted the change in some places, because it typically means that consumers using little energy pay somewhat higher rates.
Write to Rebecca Smith at rebecca.smith@wsj.com
http://online.wsj.com/article/SB122722654497346099.html?mod=yahoo_hs&ru=yahoo
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2nd post of the day.
Obama Is Still Pushing Green Snake Oil
Jacob Sullum | November 20, 2008, 12:53pm
In a taped speech shown to attendees at a climate change conference in California this week, Barack Obama continued trying to distract Americans from the enormous cost of making substantial reductions in carbon dioxide emissions by promising "five million new green jobs that pay well and can't be outsourced." Not only is this number pulled out of thin air; it's nothing to be happy about. As I've noted, the manpower required to transform the economy so that greenhouse gas emission targets can be reached is a measure of the cost involved. Obama makes it seem as if we should try to maximize this cost, promising that green jobs will "steer our country out of this economic crisis."
That is pretty much the opposite of the truth. As The New York Times notes, "some industry leaders and members of Congress have suggested that Mr. Obama's climate proposal would impose too great a cost on an already-stressed economy—having the same effects as a tax on coal, oil and natural gas—and should await the end of the current downturn." Obama's response is to portray the economic burden as a boon.
In the speech, he does implicitly make the case that the cost he refuses to acknowledge will be justified in the long run:
Few challenges facing America—and the world—are more urgent than combating climate change. The science is beyond dispute and the facts are clear. Sea levels are rising. Coastlines are shrinking. We've seen record drought, spreading famine, and storms that are growing stronger with each passing hurricane season.
Is it really "beyond dispute" that global warming already has produced drought, famine, and stronger storms? New York Times environmental reporter Andrew Revkin notes that "the statement about 'storms that are growing stronger with each passing hurricane season' is hard to square with the science on hurricanes in a warming world, which has gotten more nuanced of late."
Even if Obama were right about current conditions, and right that things will only get worse, what evidence is there that his cap-and-trade plan will ameilorate the trend enough to justify the cost? Assuming we meet his goal of an 80 percent reduction in carbon dioxide emissions by 2050 (a conveniently distant deadline), how much will it cost, what impact will it have on global warming, and how much damage will thereby be avoided?
Bjorn Lomborg, author of The Skeptical Environmentalist and Cool It: The Skeptical Environmentalist's Guide to Global Warming, argues that adapting to climate change is much more cost-effective that trying to prevent it, an effort he says is unlikely to have any measurable impact. Presumably Obama thinks Norberg Lomborg is wrong. I'd like to hear why. But that would require Obama to be more candid about the sacrifices demanded by his plan to create the Clean-Energy Economy of Tomorrow. It is difficult to perform a cost-benefit analysis you refuse to admit there's a cost.
Ron Bailey's interview with Lomborg appeared in the October issue of reason.
http://reason.com/blog/show/130187.html
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"Xcel Energy...saw home-energy use drop 3% in the period from August through September, "the first time in 40 years I've seen a decline in sales" to homes... doesn't think foreclosures are responsible for the trend."
I wonder why not. 50% of home sales are 'bank mediated'. Aren't most foreclosure homes empty?
Nonetheless, we need real increases in power and grid capabilities if we are thinking of plugging in a major part of the transportation sector within a couple of years. Doesn't a nuclear plant take 10 years to build? (Obama thinks we should "look into it...") I don't see how anyone can make strategic plans with all this uncertainty and with the direction of the economy dependent on government indecision.
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Well here is a Malkin piece that is a real eye opener.
Where is the MSM outrage over a government agency's destruction of its records?
How is this legal? This is a government coverup? I don't get it. This broad should be in jail. Not up for energy "Czar" which is just code for leftist eco-nazi thug.
The Clintons and their legalize slime balls are at it again.
He was one of the *worst* presidents because he brought ethics, honor, integrity, and politics itself down into the gutter.
But of course the MSM adores him and his cronies and their ability to combat the "vast right wing conspiracy" which completely makes up these scandals.
Yes, as Michelle states, all this Clinton regression "we can't afford". Yet the clinton slime balls conned their way back to the limelight again. The crats I thought finally had someone else yet the cancer keeps creeping back.
I still feel BO made a huge mistake picking Hillary and her gang. Anytime we can keep the Clintons out of any power situation we must do so. They are sick.
***Lead StoryCrooked Carol Browner: Obama’s ethically-challenged energy czar
By Michelle Malkin • December 12, 2008 09:10 AM My syndicated column today puts the screws on Clintonite Carol Browner, rumored to be Obama’s choice for energy czar. She’s not so fresh and so clean. And conservatives should raise their voices for, you know, real change.
Same old, same old.
The trouble with Obama’s energy czar
by Michelle Malkin
Creators Syndicate
Copyright 2008
Yet another Clintonite has been wheeled out of the political morgue to serve in the Obama administration. Carol Browner, a neon green radical who headed the Environmental Protection Agency from 1993-2000, is widely rumored to be the president-elect’s choice for “energy czar.” But an ethical cloud still hangs over Browner’s EPA legacy. It doesn’t take a team of Ivy League-degreed lawyers to figure out that this is one more headache the Hope and Change crew doesn’t need.
In the spirit of reaching across the aisle, let me dust off the cobwebs and help out all the smarty-pants vetters on the Obama team with a little background on Browner’s stained past:
On her last day in office, nearly eight years ago, Browner oversaw the destruction of agency computer files in brazen violation of a federal judge’s order requiring the agency to preserve its records. This from a public official who bragged about her tenure: “One of the things I’m the proudest of at EPA is the work we’ve done to expand the public’s right to know.”
Asked to explain her track-covering actions, the savvy career lawyer Browner played dumb. Figuratively batting her eyelashes, she claimed she had no clue about a court injunction signed by U.S. District Judge Royce Lamberth on the same day she commanded an underling to wipe her hard drives clean. Golly gee willikers, how could that have slipped by her?
According to testimony in a freedom of information lawsuit filed against EPA by the Landmark Legal Foundation, a Virginia-based conservative legal watchdog group, Browner commanded a computer technician on Jan. 19, 2001: “‘I would like my files deleted. I want you to delete my files.” Not coincidentally, the Landmark Legal Foundation had been pressing Browner to fully and publicly disclose the names of any special interest groups that may have influenced her wave of last-minute regulatory actions. Two days before she told her technician to purge all her records, EPA had gone to court to file a motion opposing the federal court injunction protecting those government documents.
Plausible deniability? Not bloody likely.
Incredibly, Browner asserted that there was no work-related material on her work computer. She explained she was merely cleaning the hard drive of computer games she had downloaded for her son, and that she wanted to expunge the hard drive as a “courtesy” to the incoming Bush administration. How thoughtful. Later, her agency admitted that three other top EPA officials had their computers erased despite the federal court order and ongoing FOIA case (the record is silent on whether Browner’s son was playing games on their desktops, too). A further belated admission revealed that the agency had failed to search Browner’s office for public documents as required by Landmark’s public disclosure lawsuit.
Not only were all the top officials’ hard drives cleared and reformatted, but e-mail backup tapes were erased and reused in violation of records preservation practices.
After a two-year legal battle, Judge Lamberth finally held the EPA in contempt of court for the systemic file destruction – actions Lambert lambasted as “contumacious conduct” (obstinate resistance to authority). As is typical in Washington, Browner weaseled out of any serious repercussions. Lamberth inexplicably decided that slapping the agency as a whole with contempt – rather than any individual – would deter future cover-ups.
Is this a gamble the Obama administration wants to take? Browner has crossed the line and violated public trust before in her capacity as eco-chief. Early in her first term as EPA head, Browner got caught by a congressional subcommittee using taxpayer funds to create and send out illegal lobbying material to over 100 grassroots environmental lobbying organizations. Browner exploited her office to orchestrate a political campaign by left-wing groups, who turned around and attacked Republican lawmakers for supporting regulatory reform. These are the very same groups – anti-business, anti-sound science, pro-eco-hysteria – that Browner would be working arm in arm with as Obama’s “energy czar.”
This is regression we can’t afford.***
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http://www.jpost.com/servlet/Satellite?cid=1228728256490&pagename=JPost%2FJPArticle%2FPrinter
Obama may adopt Israeli electric car'
Dec. 18, 2008
David Horovitz , THE JERUSALEM POST
The incoming Obama administration is "closely monitoring" the innovative electric car project being developed by Israel's Better Place company, "and may be adopting it," Idan Ofer, chairman of Better Place, has told The Jerusalem Post.
Heralding a potential private transport revolution, a leading US car manufacturer is also now "putting together a team" to work on the project, Ofer said. Renault-Nissan agreed 18 months ago to build the first cars, and will be mass-producing hundreds of thousands of the electric-powered vehicles by 2010, he noted.
Ofer said the electric car was a natural fit for the Obama presidency as it prepares to grapple with the global financial crisis, environmental concerns, a dependence on oil supplies from unfriendly countries and a collapsing conventional car-building industry.
The crisis afflicting Detroit was underlined Thursday, when the Bush administration said it was seriously considering "orderly" bankruptcy as a way of dealing with the desperately ailing auto industry.
"There's an orderly way to do bankruptcies that provides for more of a soft landing. I think that's what we would be talking about," said White House Press Secretary Dana Perino.
The comments came a day after Chrysler LLC announced it was closing all its North American manufacturing plants for at least a month as it, General Motors Corp. and Ford Motor Co. await word on government action. General Motors has also been closing plants, and it and Chrysler have said they might not have enough money to pay their bills in a matter of weeks.
Ofer said he was anticipating "the electrification of America" as Barack Obama's logical instrument for rescuing the industry, as well as promoting environmental responsibility, enabling reduced oil dependence and underpinning economic revival.
"This is very dear to the heart of the Obama administration," he said, noting that Obama's newly announced choice for energy secretary, Nobel physics laureate Steve Chu, "is a huge advocate of alternative energy. He says we must get away from oil."
Ofer said that "America spent somewhere between $500 [billion] and $700b. on imported oil in 2008." The incentive to shift away from that kind of dependence was overwhelming, he said.
When "you hear announcements" from the incoming administration about reviving Detroit with electric cars, job creation in battery factories and modernizing the national electricity grid, said the Better Place chairman, "you'll know that it will have come from us."
The Post was awaiting a response from Obama's officials at press time.
Obama officials said this week that the president-elect was laying the groundwork for a giant economic stimulus package, possibly $850b. over two years. Like public works projects of the depression era, they said, Obama's plan would feature spending on roads and other infrastructure projects as well as new and renovated schools. It also would aim for energy-efficient government buildings and development of environment-friendly technologies.
Better Place, established 14 months ago by entrepreneur Shai Agassi, aims to switch cars worldwide from the pump to the plug, using battery-powered electric vehicles that would recharge at parking meter-style "charging spots," on a grid powered by renewable energy.
Israel, Denmark and Australia are formally committed to the idea. Earlier this month, the Japanese government invited Better Place to work with its local car manufacturers on a first electric car venture. The state of Hawaii signed up to a pilot program last week.
The Renault-Nissan vehicles will cost about the same as conventional cars for now, but will ultimately be cheaper, said Ofer. He said they have comparable acceleration, can reach comparable speeds (of 150 to 180 kph) and can run 150-200 kilometers on a single battery.
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Reminds me of how the Chevy CEO showed up to the last congressional grilling he had to endure driving a Chevy Volt. Of course the car only has a range of 40 miles so it had to ride on the back of a truck to the outskirts of DC. . . .
Much like with ethanol, electric vehicles are a lot more about sizzle than steak and have well known engineering issues to overcome before they are presented as solutions.
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I would think electric cars would do better in Israel and Europe than America because they drive shorter distances regularly and the higher price of a gas. This guy isn't a policy maker making undelilverable policies he is someone running a business who thinks he can make money. Driving the Chevy volt after trucking it in certainly sounds like greenwash.
Editor's notes: From pumps to plugs
Dec. 18, 2008
David Horovitz , THE JERUSALEM POST
Idan Ofer was showing off his Better Place company's electric car to the visiting Austrian president, Heinz Fischer, outside the Dan Panorama hotel in Tel Aviv earlier this week. To Ofer's complete surprise, the Austrian head of state "broke all the rules," set aside such trifling considerations as security and insurance, and insisted on taking the vehicle for a spin.
"He simply took off," Ofer reports in a telephone interview, chuckling broadly down the line.
Which is precisely, Better Place's Chairman Ofer suggests, what is now happening to the whole electric car project. By his telling, it is an idea whose time has come, a revolution that, like the Austrian leader, is simply taking off.
Though he's keeping some of his cards close to his chassis, Ofer cautiously reveals that the nascent Obama administration "is closely monitoring Better Place and may be adopting it."
That's a staggering revelation, one that promises a fundamental overhaul of global private transport. But the inherent logic is unarguable.
Electric car technology has now reached maturity. Renault-Nissan, the pioneering manufacturing partner for the innovation of Better Place's founder and CEO Shai Agassi, will be mass producing hundreds of thousands of the electric-powered vehicles by 2010, Ofer says. The vehicles will cost about the same as conventional cars for now, but will ultimately be cheaper. They have comparable acceleration. They can reach comparable speeds (of 150 to 180 kph). And they can run 150-200 kilometers on a single battery, using hardly any power when idling in traffic (unlike their gas-guzzling predecessors).
Better Place is uniquely capable of overseeing the integrated system that enables them to operate, Ofer says. Barely a year after it was founded, with $200 million of venture capital, it is geared up to establish vast networks of the plug-in "charging spots" at which the cars refuel with their electric oil, and the battery swap stations that will ideally supersede today's gas stations.
The State of Israel is an enthusiastic partner, committed to the widespread deployment of an electric recharge grid to power vehicles by 2011. Denmark and Australia are on board. Earlier this month, the Japanese government invited Better Place to work with its local car manufacturers on a first electric car venture. Last week, the state of Hawaii announced it was driving up, too. The French "say they are with us," Ofer reports. "They want to be the first and the most innovative."
Sample "charging spots" are on display in the parking lot at Cinema City, north of Tel Aviv, and in London. Next year, more will be deployed, and many more in 2010, by which time, says Ofer, "we'll be selling real cars to real people."
AT THE same time as such practical progress is being made, critically, the imperative that is driving a change to electric cars has never been more obvious or more urgent.
On a planet whose responsible leadership and activists are unprecedentedly conscious of the environmental damage we foolish, selfish humans are wreaking, the electric car is a nonpolluter, with zero CO2 emissions.
In a Western world anxious to reduce its dependence on oil supplies from unfriendly countries, the battery car is a veritable panacea.
And then there's the small matter of the global financial crisis, snowballing just as the change-oriented Obama administration prepares to take office.
Obama's key priority will be to begin healing the American economy, to invest in new infrastructures, to create new jobs. Most pertinently for this venture, he's also grappling with an antiquated car-building industry on the brink of collapse and pleading for bail-outs. But just doling out money to Detroit, Ofer suggests wryly, paraphrasing a recent adulatory Thomas Friedman article in The New York Times, would be like propping up the typewriter industry in the age of the PC, home printer and Internet.
"Our way," enthuses Ofer, a former head of the United Mizrahi Bank, "is the only way."
What Agassi is doing with electric cars, he adds, citing another of Friedman's parallels, is much like what Steve Jobs of Apple has done for music - recognizing the astounding potential of new technologies, and harnessing them for a radically fresh means of providing mobility. As Friedman put it with his Steve Jobs simile, "It just takes the right kind of auto battery - the iPod in this story - and the right kind of national plug-in network - the iTunes store - to make the business model work for electric cars at six cents a mile."
Ofer is anticipating "the electrification of America" as Obama's logical instrument for achieving change, promoting environmental responsibility, enabling reduced oil dependence and underpinning economic revival. "This is very dear to the heart of the Obama administration," he says. "Just look at who Obama has chosen as energy secretary - Steve Chu. He knows his stuff. He's a huge advocate of alternative energy. He says we must get away from oil..."
Indeed so. Obama has promised to spend $150 billion on alternative energy over the next decade, and says he selected Chu, who won the 1997 Nobel Prize in Physics, as "uniquely suited" to steward the necessary innovations. At California's Lawrence Berkeley National Laboratory over the past four years, according to US News & World Report, Chu has backed research into advanced biofuels, solar power and energy efficiency, and fought shrewdly for funding from the federal government and private industry. Last year, he persuaded oil giant BP to sign onto a $500m. partnership for alternative energy research. In short, the magazine concluded, he's "a scientist who can find common ground with industry."
Enthuses Ofer: "America spent somewhere between $500b. and $700b. on imported oil in 2008."
The incentive to shift away from those kinds of numbers is overwhelming, given the economic crisis, the environmental imperatives and the unsavory regimes this spending supports. And that's plainly where President-elect Obama is heading.
So listen up, Ofer says, for announcements from the new administration about reviving Detroit with electric cars, job creation in battery factories, modernizing the national electricity grid. "And when you hear those announcements," says the Better Place chairman, "you'll know that it will have come from us."
While Renault-Nissan took the pioneering plunge 18 months ago, some of the American car manufacturers have been highly resistant, he acknowledges. "I understand that. Some of them didn't believe in this. Others wanted some kind of hybrid. But now all serious car manufacturers recognize it's going to happen. It's the only way.
"Some of these firms are dysfunctional," he says with blunt cheerfulness. "I've had meetings where the top executives said 'No' to us, and the subsidiaries said 'Let's do it.'" But the inescapable truth, he insists, is that these companies are using yesterday's technology, and they are gradually internalizing this, in a process that is being catalyzed by their financial predicament. Significantly, says Ofer, "in the last few days, one of the big US manufacturers, which had been resistant, told us that he was putting together a team and planning an announcement."
Simply put, he notes, if the incoming president says "this is what we want you to do, and that way you'll stay in business" - and there's a very serious possibility of Obama saying precisely that - then that's what they'll do.
BETTER PLACE, Ofer stresses, doesn't make the cars. It has, rather, produced the integrated system for their operation. "We set up the charging spots, which look like little parking meters," he says. "We set up the battery swap places, generally in gas stations." And the firm makes its money, of course, by running the network.
"Better Place's model means consumers subscribe to transportation as a service, much like they do today with mobile phones," the company's Web site explains. "Auto companies make the electric cars that plug into the Better Place electric recharge network of charging stations and battery swap stations. Energy companies provide the network's power through growing renewable energy projects. And Better Place provides the batteries to make owning an electric car affordable and convenient."
Better Place is "uniquely advanced in this," Ofer claims, noting that Agassi is a former systems integrator for Germany's SAP software firm. "It's not so easy to put down 500,000 charging spots across Israel by 2011. In Tel Aviv for example, the mayor likes the idea. But it's complicated. There isn't a lot of parking space under buildings, so our charging spots will be in the streets, where there's not much room either. Do you keep such spots exclusive for electric cars? Like I said, it's complicated."
Better Place's "e-mobile" drivers will charge up at home, in the office, or on the street. "But we're not talking about simply plugging in, like a milk cart," he says of the sophisticated powering process. Rather, there will be options - cheaper and more expensive packages, prioritizations, different rates for charging at different times of day. "Somebody might have a cheaper option where they only want to be charged during the night... These kinds of options are very good for the national electricity grid because they spread demand more efficiently."
By next year, the company expects to have a major visitor center open here to promote the technology. "Already, the Foreign Ministry is telling us that most every foreign delegation wants to visit Better Place, that it's the biggest innovative draw in Israel."
OFER CONFIDENTLY predicts a spiral of interest and, thus, of improved technology, viability and demand.
"Imagine the Israel of 2011 is flooded with electric cars," he urges. "Your conventional car will be worthless. There'll be a natural migration to electric cars.
"Now remember," he goes on, "the average car in Europe is replaced every eight years." Governments will increasingly be offering incentives to drive and park electric cars. "Of course they will. It gives them silent cities, unpolluted cities. Think of the savings in public health costs as a result of the reduced pollution."
And the more that people see that it's real, he says, "the more research resources they will devote to improving the technology even further."
Hopefully, he adds, there will be an intensifying push to generate the electricity from alternative energy sources, too: Better Place was reported earlier this year to be planning a vast solar energy field in the Negev for the purpose.
Ofer concludes with the assertion that even the least enthusiastic players are gradually being drawn into the electric era. Until recently, he says, the powerful German manufacturers were taking the view that their industry was just fine. "German car executives are very influential. They are not geared up for this. They are the most resistant," he says. "But now I'm even feeling a shift from negative to positive there. And the moment the US shows signs of going electric, they'll turn around completely."
Turn around and drive right up, that is. Just like President Fischer.
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Interesting link with a lot of raw US energy production data on it:
http://tonto.eia.doe.gov/oog/info/twip/twip.asp
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This piece notes why fuel economy standards are anti-market and ineffective for a number of reasons. If does not note how CAFE standards also cause traffic deaths by putting less substantial vehicles out on the road.
http://www.reason.com/news/show/131279.html
Obama's Fuel Economy Follies
Politicians want you to pay more when you drive. They just won't admit it.
Ronald Bailey | January 27, 2009
"We must ensure that the fuel-efficient cars of tomorrow are built right here in the United States of America," President Barack Obama declared yesterday. He also signed an order directing the Environmental Protection Agency (EPA) to review the denial of California's request to set its automobile mileage standards higher than those adopted by the federal government.
In 2007, Congress passed and President George Bush signed legislation aimed at increasing Corporate Average Fuel Economy (CAFE) standards to at least 35 miles per gallon (mpg) by 2020, up from 27.5 today. Federal CAFE standards were originally set in 1975 during the first "energy crisis." If an automaker's average mileage fails to meet the CAFE standards, it must pay a fine which currently stands at $5.50 per 0.1 mpg, multiplied by the manufacturer's total domestic production. Some companies choose to simply pay the penalty. For example, BMW handed over $230 million in fines last year while Daimler, the maker of Mercedes-Benz automobiles, paid $55 million, and Volvo paid $56 million.
Now, California and 13 other states, representing about 50 percent of the U.S. automobile market, want to force carmakers to meet the 35.7 mpg standard by 2016, rising to 42.5 mpg in 2020. Proponents argue that the higher mileage standard is needed to both cut the emissions of greenhouse gases that are contributing to man-made global warming and to reduce our dependence on foreign oil.
Do CAFE standards work? The CAFE standards established in 1975 during the first "oil crisis" explicitly aimed to reduce America's dependence on imported oil. In 1975, the U.S. imported about one-third of the petroleum it consumed. By 2008, imports accounted for about two-thirds of consumption. On the other hand, a National Academy of Sciences (NAS) report in 2002 estimated that CAFE standards had reduced U.S. oil consumption by 14 percent below what it would otherwise have been.
In 2007, the Pew Campaign For Fuel Efficiency released a poll in which 89 percent of respondents said that it was important for Congress to pass higher automobile fuel efficiency standards. Whatever Americans might tell pollsters, they voted quite differently with their pocketbooks. For example, CAFE standards on passenger vehicles had a big unintended consequence—the rise of sport utility vehicles (SUVs). Mileage standards for light trucks were set lower at 20.7 mpg and SUVs and minivans qualified as light trucks. In 1975, only 20 percent of vehicles sold were light trucks, but by 2002, that had risen to more than 50 percent of vehicles. In 2002, the San Francisco Chronicle reported that the EPA's 10 most fuel efficient models constituted less than 2 percent of auto sales. As recently as 2007, none of the top 10 vehicles chosen by consumers voting at the popular website CarGurus.com had an average gas mileage that met current federal CAFE standards
In his announcement yesterday, Obama estimated that the new federal mileage standard would save 2 million barrels of oil per day. Although estimates vary considerably, boosting fuel efficiency is not cost-free. California Air Resources Board Chair Mary Nichols endorses a rosy scenario, claiming that the state's new standards will only add about $400 per car. On the other hand, General Motors Vice Chairman Bob Lutz apocalyptically predicts that even the less stringent new federal CAFE standards will boost car prices by $4,000 to $10,000 per vehicle, averaging around $6,000. The Energy Information Administration's middle of the road calculation is that the new California regulations would add about $1,900 in costs to each vehicle. Essentially, CAFE standards function as a kind of inefficient stealth tax on driving. It's inefficient because drivers pay more, car companies make less money, and state and federal governments don't get any extra revenues.
But CAFE proponents argue that there is a bright side—the higher costs for the gas-sipping cars will be offset by lower gas bills. For example, a car driven 12,500 miles per year at 27.5 mpg would use 454 gallons of gas annually. Raising the mileage to 35 mpg reduces that figure to 357 gallons per year. So the new California standards would save drivers an average of 100 gallons per year. At $1.50 per gallon that comes to $150 per year; at $4 per gallon it comes to $400.
Politicians claim that manufacturing the new CAFE-compliant cars will increase jobs in the auto industry. But will it? All other things being equal, increasing the price of a product is not usually considered a sure fire recipe for attracting more customers. Higher prices mean lower demand, something that normally results in fewer jobs in the auto industry. On top of that is the fact that it takes fewer workers to manufacture the generally smaller cars that meet CAFE standards. It's hard to see how higher CAFE standards will produce more jobs.
If California's state legislators—and the other politicians who favor the new higher mileage standards—really want their citizens to drive more fuel efficient (and generally smaller) cars, there is a simpler and more honest policy: Hike gasoline taxes substantially. In 2002, the NAS's report correctly observed, "There is a marked inconsistency between pressing automotive manufacturers for improved fuel economy from new vehicles on the one hand and insisting on low real gasoline prices on the other. Higher real prices for gasoline—through increased gasoline taxes—would create both the demand for fuel efficient new vehicles and an incentive for owners of existing vehicles to drive them less." In other words, taxing gasoline would achieve the politicians' stated goals of reducing imports of foreign oil and cutting greenhouse gas emissions much more efficiently than convoluted CAFE standards—since taxes would apply to all vehicles, not just new ones.
The NAS further noted that more models of high mileage cars were produced abroad largely because gasoline in other countries costs $4 to $5 per gallon. Last year, we learned definitively that Americans respond with alacrity to higher fuel pump prices. As gasoline prices soared to over $4 per gallon, consumer demand for smaller cars rose by 37 percent over the previous year. At nearly 64 cents per gallon, California already imposes the highest gasoline tax in the country, yet Californians continue to insist on buying and driving cars of which their legislators disapprove. Ultimately, setting CAFE standards is just a way for cowardly politicians to avoid telling their fellow citizens that they should pay more for the privilege of driving.
Ronald Bailey is Reason magazine's science correspondent. His book Liberation Biology: The Scientific and Moral Case for the Biotech Revolution is now available from Prometheus Books.
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This vapid piece fails to address the fundamental issue: ethanol production is inherently inefficient and diverts materials from more economically feasible uses.
February 12, 2009
Ethanol, Just Recently a Savior, Is Struggling
By CLIFFORD KRAUSS
Barely a year after Congress enacted an energy law meant to foster a huge national enterprise capable of converting plants and agricultural wastes into automotive fuel, the goals lawmakers set for the ethanol industry are in serious jeopardy.
As recently as last summer, plants that make ethanol from corn were sprouting across the Midwest. But now, with motorists driving less in the economic downturn, the industry is burdened with excess capacity, and plants are shutting down virtually every week.
In the meantime, plans are lagging for a new generation of factories that were supposed to produce ethanol from substances like wood chips and crop waste, overcoming the drawbacks of corn ethanol. That nascent branch of the industry concedes it has virtually no chance of meeting Congressional production mandates that kick in next year.
The decline in fortunes has been extreme for both kinds of ethanol since last summer, when $145-a-barrel oil appeared to shift fuel economics in their favor.
Only months ago, refiners in some regions were buying up as much corn ethanol as they could to blend with expensive gasoline, effectively keeping pump prices down slightly. Meanwhile, investors seemed willing to finance plants to produce next-generation biofuels.
But since the summer, oil and gasoline prices have plunged, while the price of corn, from which virtually all commercial ethanol in this country is made, has remained relatively high. Refiners are limiting their ethanol purchases to a level required to meet federal blending mandates — a level far below the industry’s capacity.
“The ethanol industry is on its back despite the billions of dollars they have gotten in taxpayer assistance, and a guaranteed market,” said Amy Myers Jaffe, an energy analyst at Rice University.
The government’s Energy Information Administration recently projected that the industry would fall short of the targets for expanded use of ethanol and other biofuels that Congress set in a 2007 energy law. “It’s possible we may have to look at the targets again,” said Senator Jeff Bingaman of New Mexico, the chairman of the Senate Energy and Natural Resources Committee.
VeraSun Energy, one of the nation’s largest ethanol producers, has suspended production at 12 of its 16 plants and is planning to sell production facilities. In recent days Renew Energy, Cascade Grain Products and Northeast Biofuels have filed for bankruptcy protection. Pacific Ethanol said it would suspend operations at its Madera, Calif. plant.
Bob Dinneen, president of the Renewable Fuels Association, a trade group, estimated that of the country’s 150 ethanol companies and 180 plants, 10 or more companies have shut down 24 plants over the last three months. That has idled about 2 billion gallons out of 12.5 billion gallons of annual production capacity. Mr. Dinneen estimated that a dozen more companies were in distress.
Ronald H. Miller, the president and chief executive of Aventine Renewable Energy, said, “The economics right now are very poor.” Aventine has suspended construction of one Nebraska plant and delayed completion of a second in Indiana.
This is not how it was supposed to be when Congress mandated in 2007 that refiners blend increasing amounts of ethanol into the country’s transportation fuel supply. The law came at a time when the country’s thirst for gasoline seemed unquenchable, and oil prices seemed only to go up.
In an effort to reduce the country’s dependence on foreign oil and to lower the greenhouse gas emissions that contribute to global warming, Congress mandated a doubling of corn ethanol use, to 15 billion gallons a year by 2015. Congress also mandated, by 2022, the use of an additional 21 billion gallons of ethanol and other biofuels produced from materials collectively known as biomass. The potential materials include corn stubble, wood chips and straw.
Congress hoped that advanced biofuels would overcome the longstanding controversies associated with corn ethanol, including the contention that its production raises food prices. Congress started small, decreeing that industry produce 100 million gallons of advanced biofuels next year and 250 million gallons in 2011. But it is becoming clear that even these modest targets will not be met.
Producing the advanced fuels entails breaking down a tough material, cellulose, that is abundant in corn cobs, wood chips and other biological waste, then converting it to liquid fuel. While scientists have proven it can be done, the cost is still high, and little if any cellulosic ethanol is being produced at commercial scale.
Carlos A. Riva, president and chief executive of Verenium, a company working to produce ethanol from sugar cane waste, said that solving the technological hurdles for this type of fuel was “not a slam dunk.” But he and other executives say they are optimistic the challenges can be overcome, and the 2011 and 2012 targets may be met a few years late.
Small, mostly private companies that go by names like Range Fuels, Poet and BlueFire Ethanol have built pilot plants and hope to move into commercial production. But private investment in advanced biofuels has plummeted since the economy went sour late last year, and it is unclear if the industry can scale up. “Cellulosic ethanol is something that is always five years away and five years later you get to the point where it’s still five years away,” said Aaron Brady, an energy expert at Cambridge Energy Research Associates, a consulting firm.
With gasoline consumption declining even as federal mandates for ethanol are increasing, demand for cellulosic ethanol may be insufficient anyway.
Energy experts project that national gasoline consumption in 2009 and 2010 will be 6 percent or more below the 2007 level, and future ethanol production targets could represent more than 10 percent of gasoline production. Since regulations set a 10 percent blend limit for ethanol in most gasoline, there would be no place for ethanol production to go.
“Without moving the blend wall, there is no future for cellulosic ethanol,” said Jeff Broin, president and chief executive of Poet, a company with interests in corn and cellulosic ethanol.
Automobile manufacturers say most of their cars are not designed to run on higher ethanol concentrations. But the Environmental Protection Agency and the Department of Energy are conducting studies to see if the 10 percent limit could be raised.
Senator Bingaman said he expected those tests to be completed over the next year or so, and he would like to see higher blend levels for ethanol.
“There’s no doubt when we wrote that bill, we did not anticipate the recession we are currently sinking into,” he said. “Exactly what that requires us to do as far as changing the law, I am not clear on yet.”
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Also, I gather that all the increased farming to produce the ethanol uses fertilizers which run down the Mississippi River into the Gulf of Mexico where a very large and growing oxygen void "dead zone" is killing pretty much everything in to , , , :cry:
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If only...
I am no expert but it seems to me,
if US oil producers could only start investing into drilling off the continental shelf our ability to reduce our dependence on foreign oil would probably be faster than by doing anything else (like Brazil).
Why O'Reilly and other sensible people keep making excuses for BO; that is he is really more moderate than Pelosi....
This guy is just as much a far left loon as the rest of the Pelosi et al.
He was the most liberal voter in the Senate. When Pelosi says she will watch BO's back she meant she will help him appear to be the moderate when in fact he is rooting/supporting for her policies hook line and sinker.
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Of course the Obots have passed on drilling.
Good thing we freed Iraq!
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Iraq’s oil reserve enough for 100 years- minister
February 14, 2009 - 02:25:20
KARBALA / Aswat al-Iraq: Iraqi Minister of Oil Hussein al-Shahrestani on Saturday said that Iraq has an oil reserve that will suffice for the next 100 years.
“Iraq has an estimated 400 geological compositions that have not yet been discovered,” the minister told several reporters, including a correspondent for Aswat al-Iraq news agency, during his visit to Karbala city today.
“Explored oil in Iraq reaches 115 billion barrels,” the minister said, adding that oil excavation companies will even increase Iraq’s reserve of crude oil.
“This will make Iraq home to the world’s largest oil reserve,” he noted.
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Good thing we freed Iraq!
Good point.
So we can increase our dependence on foreign oil till we can develop alternative fuels (if ever).
It sounds to me that it would be decades before alternative will be able to replace and not cmplement oil.
I hate to say it but I hope BO *fails"! I have come to the conclusion that it would be better for the US to go through more pain now than for us and our children to have a future that is controlled by the likes of BO.
Maybe the conservatives are closer to the truth about going back to conservative basics. I just don't know. I just can't see how calling for tax cuts is anywhere enough of an answer to our problems and additionally that will NOT IMO increase the Republican base and the demographics are changing. And of course crats are doing everything they can to speed this up.
Medical care is already so regulated that I am resigned to socialized care. I don't think most doctors and even most of my patients seem to understand what we are in for with regards to big goernment takeover of medicine. Yet I admit costs are out of control and the private sector has not stemmed the increase.
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Oil Price Collapse — Bad News?
Posted By Jerry Taylor On February 20, 2009 @ 11:24 am In Energy and Environment | Comments Disabled
In the Washington Post today, staff writer Steven Mufson [1] gets space on the front page to tell us about how the oil price collapse is playing out for oil producers, rival energy generators, and, ultimately, for consumers. Much of what follows is obvious — prices are declining because the economic collapse is hammering demand — but other aspects of the narrative offered by Mufson are on shakier ground.
Ed Morse — managing director and chief economist of LCM Research and a favorite “go-to” guy for print reporters — says, “The last five years saw the rebirth of the use of oil as a critical instrument of foreign policy by key resource countries, Iran, Russia, and Venezuela in particular. With oil and natural gas prices having collapsed, the power of their weapons has been waning rapidly…” Really? When, exactly, have oil-producing states used oil as a weapon in foreign policy over the course of the 2004-2008 price spiral? Have there been embargoes I’ve missed? Strategic production cutbacks tied to the Israeli occupation of the West Bank? Or substantive threats about the same that have been used as an effective lever in international relations? Not that I know of.
The only example I am aware of that Morse might cite to back up his claim is Russia’s ongoing dispute with Ukraine over natural gas prices. But gas producers have leverage in markets that oil producers don’t have, given the much higher transaction costs associated with changing buyer-seller relationships.
In short, Morse’s first claim — that oil producers have been using oil as an effective foreign policy weapon during the boom — is utterly without foundation. His second claim conflates natural gas with oil markets in a manner that muddies the issue. Belief in the “oil weapon” is like belief in UFOs; lots of people claim to have seen such things — and some continue to fear such things — but every attempt at verifying existence has [2] come up empty. The reality is that embargoes can’t deny oil to consuming states given the fungible nature of the international oil market and severe production cutbacks will do far more harm to producers than consumers — which is why we never see those sustained production cutbacks play out.
Next, Mufson implies that energy secretary Steven Chu made some sort of gaffe when he told reporters on Tuesday that OPEC was “not in my domain.” Now, it may be correct that, politically speaking, OPEC is in his “domain,” but the reality is that American pressure on OPEC never has and probably never will have an effect on decisions made by the cartel. OPEC’s aim, after all, is to maximize revenue. Can the U.S. talk OPEC into decisions that will cost OPEC money? Chu’s right to suggest that no mere U.S. energy secretary is capable of such a thing and probably [3] shouldn’t waste much time laboring for such an unlikely end. Bully for Chu — for a few moments at least, he had the courage to say what almost no energy secretary before him has ever dared to say.
Unfortunately, Chu quickly spends his intellectual capital with me in the very next paragraph when he warns that oil prices will likely rise over time. Well, they may, but there is no statistically significant trend toward higher oil prices if we examine quarterly data from 1970 forward. Oil prices move around a lot, but they have always migrated back toward an equilibrium price in the inflation-adjusted mid-$20 range. The belief that oil prices march ever higher over time is widely shared, but [4] has no historical basis.
Chu’s worries about higher prices dovetail with the related warning (this time, from OPEC president Chakib Khelil) that the price respite is only temporary. Soon enough (two years, Khelil says), demand will pick up again and then where will we be? Low oil prices mean cuts in upstream investment which means that, down the road, we’ll get even higher prices than we would have had, had the price collapse never occurred.
Now, it is true that the oil market always has and probably always will move in boom and bust cycles with price spirals and price collapses feeding off one another. But historically, those cycles take a lot longer to play out than a couple of years. We heard the same warning against complacency in 1986 when oil prices went through their last bust cycle — but it wasn’t until 18 years later (2004) that prices recovered and moved into boom cycle once again. And that experience is fairly typical. The time between peaks and valleys in global oil prices run about 20 years apart and have been doing so for over 100 years.
Producers love to warn against low oil prices because, well, they hate them. But the idea that low prices are bad for consumers is one of those things that is so obviously at odds with the reality that one should take such warnings with a heavy block of salt. Domestically, those warnings have been used to justify producer subsidies that fail to pass any reasonable economic test.
Do low oil prices “make it harder for more expensive wind and solar projects to compete,” as Mufson asserts? No. Wind and solar energy does not compete with oil because only a tiny amount of electricity is generated by oil in the United States. Low coal and natural gas prices make it hard for wind and solar to compete. True, fossil fuel prices tend to move roughly in tandem over time, but precision is everything here. Low oil prices do not “cause” natural gas and coal prices to fall and thus do not directly undercut wind and solar.
Finally, what about the dog that’s not barking — that is, what about the claim heard ad infinitum from people like Thomas Friedman and James Woolsey that oil profits are military steroids for Islamic terrorists and that eliminating the same would cut Islamic terrorism off at the knees? So far, we find little evidence that al Qaeda or related groups have been particularly harmed by low oil prices. That shouldn’t surprise — there is no historical correlation between oil prices and Islamic terrorism — whether we’re looking at number of terrorist attacks or fatalities from the same.
Article printed from Cato @ Liberty: http://www.cato-at-liberty.org
URL to article: http://www.cato-at-liberty.org/2009/02/20/oil-price-collapse-bad-news/
URLs in this post:
[1] gets space on the front page: http://www.washingtonpost.com/wp-dyn/content/article/2009/02/19/AR2009021903434.html?hpid=topnews
[2] come up empty: http://www.cato.org/pubs/articles/taylor_vandoren_energy_security_obsession.pdf
[3] shouldn’t waste much time laboring for such an unlikely end: http://www.cato.org/pub_display.php?pub_id=9810
[4] has no historical basis: http://dss.ucsd.edu/~jhamilto/understand_oil.pdf
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http://firstread.msnbc.msn.com/archive/2009/02/20/1803006.aspx
Energy Secretary Steven Chu may be a Nobel laureate Ph.D. in physics, but his first forays into energy policy suggest he's a neophyte when it comes to the ways of Washington.
At a forum with reporters on Thursday, the head of the department that has traditionally taken the lead on global oil-market policy, was asked what message the Obama administration had for the Organization of Petroleum Exporting Countries at its meeting next month.
"I'm not the administration," the Cabinet secretary replied. "I will be speaking and learning more about this in order to figure out what the U.S. position should be and what the president's position is."
Chu, who is still without a deputy, said he feels "like I've been dumped into the deep end of the pool" on oil policy.
The day before, reporters asked him about OPEC output levels after a speech to a group of utility regulators. He responded that the issue was "not in my domain."
Later, in a conference call to reporters, he said his answer reflected "more of my naiveté than anything else."
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That's really scary , , ,
BTW did any one catch that CA's budget crisis could have been solved if only they allowed off-shore drilling?
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That's really scary , , ,
BTW did any one catch that CA's budget crisis could have been solved if only they allowed off-shore drilling?
California must be sacrificed on the altar of leftist politics. Oil companies are eeeeeevil!
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http://hotair.com/archives/2009/02/20/obamas-energy-secretary-surprised-to-learn-hes-in-charge-of-oil-policy/
Obama’s energy secretary surprised to learn he’s in charge of oil policy
posted at 7:11 pm on February 20, 2009 by Allahpundit
Like Treacher says, the difference between Obama and Jesus is that Jesus knew how to assemble a cabinet.
At a forum with reporters on Thursday, the head of the department that has traditionally taken the lead on global oil-market policy, was asked what message the Obama administration had for the Organization of Petroleum Exporting Countries at its meeting next month.
“I’m not the administration,” the Cabinet secretary replied. “I will be speaking and learning more about this in order to figure out what the U.S. position should be and what the president’s position is.”…
The day before, reporters asked him about OPEC output levels after a speech to a group of utility regulators. He responded that the issue was “not in my domain.”
He confessed later to, er, “naivete.” File this away in the “Confidence Boosters” drawer along with Krauthammer’s piece today on The One’s early foreign-policy wobbles and that WaPo story from a few days ago about how Geithner, given two months to prepare a financial rescue plan, had to scrap the whole thing at the last minute and go a different route. Exit question: At least the Transportation Department’s has its eye on the ball, right?
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U.S., Canada: Drawing the Outlines of an Oil Sands Deal
Stratfor Today » February 19, 2009 | 2238 GMT
DAVID BOILY/AFP/Getty Images
A woman holding small Canadian and U.S. flags outside the Canadian parliament building in Ottawa, OntarioSummary
U.S. President Barack Obama visited Canada on Feb. 19, where he discussed energy and environmental issues with Canadian Prime Minister Stephen Harper. A potential deal regarding Canadian oil sands could affect greenhouse gas emissions protocols, and has implications for regional oil-producing state Venezuela.
Analysis
U.S. President Barack Obama visited Canada on Feb. 19, marking his first foreign trip since his inauguration. Obama met with Canadian Prime Minister Stephen Harper for talks that focused on interrelated energy and environmental issues.
It is pretty clear what the two states want from each other. The United States wants energy security and a renewed military commitment from Ottawa in Afghanistan, while Canada wants investment of money and technology in its energy sector and cooperation on dealing with related environmental issues. The Feb. 19 discussions presage more comprehensive negotiations that ultimately could reshape the global framework for dealing with greenhouse gas emissions — and could deal a blow to the energy industry in Venezuela.
Energy security is a key strategic concern of the United States, and Canada is the largest foreign supplier of crude oil to the U.S. market (followed by Saudi Arabia, Mexico, Venezuela, Nigeria and Iraq, in that order). In addition to its proximity, Canada is an attractive energy trading partner for the United States because it does not face the same challenges that limit Washington’s ability to rapidly increase supplies from other significant producers — such as a hostile government in Venezuela’s case, legislation restricting foreign participation in Mexico’s case, or militancy in the case of Nigeria.
Securing robust oil supplies from Canada will necessarily mean expanding exploitation of oil sands, which comprise most of the country’s crude production. (Canada produces only a small amount of conventional crude.) This is an expensive proposition, however. Oil sands are not like conventional crude, which can simply be pumped and shipped via pipeline. Instead, they have to be strip-mined and then melted to extract the crude — a machinery- and energy-intensive process. The resulting cost barriers have resulted in a freezing of new work on oil sands since the ongoing global recession has driven oil prices downward. Profitable oil-sands production requires a sustained crude price of $50 to $60 per barrel, but oil prices have been well below that level since the end of 2008.
The U.S. interest in energy security and the Canadian interest in boosting investment appear to be in sync on the oil sands issue, and Harper has been pushing for a deal. But Ottawa has two conditions.
The first is that the United States provide the bulk of the investment. Canada wants to smooth out the boom-bust cycle of energy production in general, and that of oil sands specifically. Because oil prices have not reliably stayed above the break-even point for oil sands production (despite a spike in mid-2008), oil companies are not likely to invest in the process on their own initiative.
Second, there is a greenhouse gas issue. The mining and processing of oil sands requires a considerable energy input in its own right, roughly 50 percent more than that of normal crude. Oil sands production by itself is thwarting Canada’s ongoing efforts to comply with its obligations under the 1997 Kyoto Protocol, and Canada hardly uses any of the crude it produces. Ottawa simply cannot meet these requirements as long as it is producing oil sands at all, much less expanding production.
Thus, Canada wants the United States to join it in taking a common position on greenhouse gas talks globally — or really, for the two to become a single entity for purposes of meeting treaty guidelines. In other words, the United States would become primarily responsible for picking up the carbon tab from the production of Canadian oil sands. The United States would take on a slight — but not crippling — increase in costs associated with emissions-reduction efforts, in return for the benefits of a strategic oil supply deal with Canada.
As a result, Washington would also share with Ottawa technological advances in the capture and sequestration of carbon from the oil-sands production process. This technology is now being tested on coal power plants in the United States, and as the technology matures, Canada will try to apply it to the oil sands. Once the carbon is captured and sunk underground, the emissions-related costs associated with the oil sands will become much less.
In return for these strategic concessions, Washington likely also will want a commitment from the Harper government to extend its military commitment in Afghanistan. Canada has about 2,700 troops deployed in the country, though its military commitment there is scheduled to end in 2011. With Afghanistan occupying one of the top slots in Obama’s foreign policy agenda, and with Washington embarking on a new military strategy of a U.S. and allied troop surge to fight the Taliban insurgency, continued military cooperation might be the price Ottawa will have to pay to secure its stake in a strategic energy and emissions deal with Washington. Attempting to deploy additional troops would trigger a backlash from Harper’s political opponents, but extending Canada’s commitment beyond 2011 at the current level might be more politically palatable.
Should such a comprehensive deal go through, with all its conditions and counterconditions, it will have two major implications internationally: one regarding greenhouse gases and one regarding Venezuela.
First, a joint U.S.-Canadian position on greenhouse gases will more or less determine the boundaries of any future global legal regime for dealing with the issue. The United States is set to emerge as the global leader in negotiating the next major climate treaty, a protocol to the 1992 U.N. Framework Convention on Climate Change. The Obama Administration has signaled that it is willing to accept the general global consensus that the world must reduce greenhouse gas emissions by 80 percent before 2050 — and with that, the United States is emerging as the leader in the next round of talks. (And if Washington and Ottawa effectively act as a single entity in these negotiations, Canada will share the driver’s seat.) How that will shape global carbon policy will be up to Canada and the United States to debate, but any new protocol will also require a more informal mechanism that directly engages China and India, two of the countries with the largest carbon footprints. A failure to get Beijing and New Delhi on board would effectively doom any new protocol — and the United States would be unlikely to ratify any such convention in any case, believing it will be penalized while China and India gain.
The second major effect of a U.S.-Canadian understanding on oil sands would be to wreck the future hopes of the other major producer of nonconventional crude oil in the Western Hemisphere: Venezuela. The Venezuelan Orinoco belt contains roughly the same amount of oil as do the Canadian oil sands. Venezuela’s crude, like the output of the oil sands, is considered “unconventional” output, because it is very heavy and sour. It requires specialized refining processes, as does oil-sands crude, and a significant percentage of it — about two-thirds of Venezuelan exports — is refined in the United States. If Canada should absorb all the limited investment capital available for unconventional crude, and if it should take over the heavy crude refining capacity in the United States along with the available specialized technical knowledge and personnel, Venezuela will largely get shut out of the global market as its own industry degrades. The result would be to put further limits on the ability of the Chavez government in Caracas to use oil revenues to support the populist policies that keep it in power.
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It crosses my mind as I fill up at 1.80 per gallon that no one (not just here) points out the role that unaffordable energy played in collapsing the global economy. I remember that gas used to be the example of inelastic demand. As a country, we refused to drill, build or refine more product, but as consumers, our usage is a little bit inelastic in the short run and within certain ranges. For example, when gas went from 50 cents to 60 cents or from 1.19 to 1.29 per gallon, people still lived the same distance from work, from church, from Grandma's house, from the store etc. so we bought the same amount of gas. When we replaced our vehicle we still needed the same number of seats and hauled the same cargo.
When gas prices double and triple, we started combining some trips and thinking about sharing rides with family, friends and co-workers. At $4 per gallon and $80 per tank or at some higher number, we gradually change our usage but we keep buying the product until bankruptcy because we still need to get places to live our lives. As consumers, gas was still a relatively small piece of the family budget.
But as oil hit $120-$150 per barrel, there were places around the globe less prosperous than the US that cried uncle first. All the data seems to indicate that the current downturn hit the rest of the world first and hardest. Factories shut down and workers were laid off. That leaves me to believe that energy prices around the world, not just Fannie, Freddie and other US shenanigans, played a major role in the global meltdown.
Today we don't talk about energy shortage because gas prices are artificially low. But they are low because of financial ruin. If/when the economy rebounds around the world, we still have the same energy shortage or worse that we had.
Instead of addressing the energy shortage, the far-left machine is hellbent on crippling supplies for the future. Somewhere in that debacle is an opportunity for an out of power party to gain traction and bring forward a positive agenda.
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Interesting thoughts there Doug.
"But as oil hit $120-$150 per barrel, there were places around the globe less prosperous than the US that cried uncle first. All the data seems to indicate that the current downturn hit the rest of the world first and hardest."
This seems perceptive to me and accords with Alan Reynolds post , , , somewhere here making the point that the downturn started outside of the US.
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Wednesday, March 4, 2009
Obama’s Clean Energy Myth
Ken Nahigian, former Chief Counsel of the Senate Energy Committee, comments on the failure to fund the Yucca Mountain nuclear storage facility:
President Obama has spent the last two years talking about his commitment to clean energy but he has not signaled any desire to expand nuclear power generation. Why? Because the environmental community has spent the past 30 years hyping concerns over the safety of nuclear power – to the extent that no nuclear power plant ordered after 1977 has been completed and brought on line in the United States. Nuclear power is emission-free energy generation. Something the President declares as critical to our future, but yet he is quietly making every move possible to ensure that not a single plant gets built during his Administration, and therefore for the decade to follow his departure. This despite him staring directly into the camera during one of the Presidential debates and conveniently declaring his support for nuclear power.
Nuclear power constitutes 20 percent of the electricity used in the United States. That’s right, one fifth of all electricity consumed. In order to keep pace with the growing demand for electricity in the United States we must continue to expand our energy generation, not shrink it. While the benefits of renewable energy are many, the reality is solar and wind power constitute two percent of all domestic energy production, and to increase it to even eight percent will require massive transmission improvements. All the while the President and Senate Majority Leader Harry Reid plan to stand by and let 40 of the current 104 nuclear plants in the U.S. potentially become decommissioned over the next 30 years. That’s a potential decrease in electrical power generation of eight percent.
Nuclear-waste management remains an issue at the forefront of the nuclear expansion debate. There is significant debate as to the responsibility of the Government in the management and storing of nuclear waste. The Federal government has proposed a single deep geological storage reserve for spent fuel in Nevada at Yucca Mountain as a substitute to the national security threat posed by storage onsite at nuclear facilities.
But bottom line, the involvement of Nevada equals Harry Reid equals no Yucca Mountain storage equals no new plants for the next two decades equals dozens of plants will be decommissioned equals an eight percent reduction in clean and safe energy equals another loss for the country. And why? Because of the environmental special interest. The same type of special interests that the President pledged to transcend.
ASO member Ken Nahigian
http://americaspeakon.blogspot.com/2009/03/obamas-clean-energy-myth.html
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Count me amongst those doubtful of nuclear power, but I post this thoughtful article anyway.
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By JOSEPH RAGO
Washington
On the one hand, environmentalists claim that climate change is a "planetary emergency," perhaps the greatest threat ever to face humanity. On the other, nuclear energy is still verboten in the green catechism -- despite the fact that it provides roughly one-fifth of U.S. electricity, all of it free of carbon emissions. And without more nuclear power, it is nearly impossible to see even the glimmers of any low-emission future.
Zina SaundersJ. Wayne Leonard, chairman and CEO of Entergy Corp., one of the largest U.S. energy companies and the No. 2 generator of nuclear power, is no stranger to the many contradictions of American energy policy. "Everybody's gums are still bleeding from the '70s," he says of nuclear power, noting that today's technology is far superior to its Three Mile Island vintage.
The avuncular Mr. Leonard, who lives in Louisiana, made his name in nuclear, and over the last nine years as Entergy CEO he has achieved the highest total shareholder return in the nuclear power industry. But now his thoughts are concentrated on more lasting matters -- namely, his deep-seated concern about climate change.
Does he think nuclear energy has a larger role to play in that effort?
"Is it nuclear?" Mr. Leonard asks in Entergy's D.C. office. "Are you really going to mandate nuclear? I don't think so. I mean, mandate private businesses at the kind of prices we're taking about, and the kind of risks? That's pretty tough to do. You'd have to turn all of us into France" -- 79% of its electricity is nuclear -- "and have a government-sponsored program. I don't see that as consistent with what made this country into what it is today."
Mr. Leonard thinks like an economist. He talks about "efficiency" and "maximizing consumer surplus" the same way other utility executives talk about rate schedules and voltage. The most important thing the government can do on climate change, in Mr. Leonard's estimation, is to change the incentives for producing -- or, not producing -- carbon. His answer on the role of nuclear was revealing about his mentality: Set the price, and market forces, not government, will make the decisions.
"We see ourselves as a market economy, and that's created great wealth for society over time," he says, "but we're a market economy that doesn't have price signals for CO2."
Entergy belongs to the swarm of major energy companies that are -- contrary to type -- practically begging Washington to create a cap-and-trade program. Mr. Leonard supports President Barack Obama's plan to slash emissions 80% by 2050. It sounds strange: Lobbying the government to tax your products is generally not taught in business school.
But then, a lot of companies stand to make a bundle off cap and trade. Once Congress puts a ceiling on emissions, and then allows businesses to sell any of its extra allowances that stand for the right to emit, it is essentially creating the world's largest commodity market -- in carbon-backed securities. These will be extremely valuable, and everything comes down to how the government chooses to distribute them.
Mr. Leonard thinks the allowances should be auctioned off, rather than given away. So does the White House. Then the billions in new revenues that cap and trade would raise every year should be returned to the public. "Ideally you want to recycle it all, give all the money back," he says.
That's the purist's view on cap and trade -- and it puts him at odds with many of his peers at big coal-fired utilities like Duke Energy and American Electric Power that emit the most carbon. These companies signed on in the expectation that the allowances would be handed out at no charge. But economically, that is the same as selling them and giving the money to businesses -- i.e., as subsidies and corporate welfare. Mr. Leonard uses more diplomatic language: "Everybody's got their kind of own self-interest out there that they're tending to promote, once you get behind it."
It would be fair here to note Entergy's own self-interest: Only about 7% of its portfolio is coal, and the nuclear industry stands to benefit as much as any "green" business from a carbon crackdown. Then again, if Congress does create cap and trade, expect the next populist outcry to be for a windfall profits tax on nuclear.
Mr. Leonard acknowledges, though, that coal and other energy companies -- and their customers -- have legitimate reasons to worry about cap and trade: "No utility CEO likes to raise rates, and that's what would happen. Your rates go up no matter what," he says. And even if the government returns every dime of climate revenues to ratepayers, "That's a painful thing for utilities to have to endure, because angriness comes toward you, and somebody else gets the goodwill." Giving out the allowances, he does concede, could help the cushion the blow.
On pure economic grounds, Mr. Leonard seems to prefer a straight carbon tax, which would be simpler and more efficient than cap and trade. But he also notes that "the political will to go the tax route . . . is just not there. Nonexistent" -- namely because the use of the word "tax." The key, he says, is to design a cap-and-trade program that will "simulate the same thing a tax would do." That is, to achieve the increased energy prices essential to the success of cap and trade.
Mr. Leonard does evince a certain . . . uneasiness with the direction of climate politics. "The old adage of 'think globally, act locally' -- it still works," he says. "But with climate change, for it to really be effective, we have to take that thought much more completely and much more deeply than probably we've ever really thought about an issue."
He notes China's breakneck construction of conventional coal plants. China has already surpassed U.S. coal capacity and is on pace to double it sometime in the middle of the next decade. The U.S., he says, could close down every single coal plant immediately and that would be "working to a global solution, acting locally. But that wouldn't do much good in the scheme of things," because atmospheric CO2 concentrations would continue to rise as China continues to expand.
"We go to zero emissions in this country, and if China doesn't follow us, we're nowhere. . . . We've just ruined our economy, and we're nowhere," Mr. Leonard says. "We make mistakes here," meaning a poorly designed carbon system, "and we have a real problem." He goes on, "We talk about that we should lead, then people will follow, but that's kind of" -- he pauses -- "silly. China's not going to follow us because we're the United States. . . . You say, 'Shut down your plants' -- well, that's going to be a short conversation. They've got $2 trillion invested in their plants and they still aren't feeding all their people." He adds that "If we were China, we wouldn't shut our plants down either."
Mr. Leonard argues that the best way to square these circles is to channel U.S. basic research dollars into the technology that can retrofit existing coal plants with carbon capture technology. Most current funding is devoted to second-generation systems that are still 10 or 20 years away from commercial deployment, at best. "We should spend 99% of our time on the problem that we have today, and it ain't going away," he says, referring to coal emissions. He also sees retrofit technology as a realistic way to curb Chinese emissions: "They're going to follow because we can offer them something."
Mr. Leonard worries, too, that Congress may make matters worse as it takes up climate change legislation this spring or summer. One proposal that enjoys wide Democratic support is a "renewable portfolio standard," which would mandate that utilities generate a certain percentage of their electricity -- as high as 20% -- from renewable sources like wind or solar. Nuclear, naturally, does not qualify.
Mr. Leonard points to yet another energy policy contradiction, which is that a portfolio standard -- which Congress would impose on top of cap and trade -- would actually increase carbon emissions. Power companies would be more likely to use renewables to replace sources like natural gas, which is relatively lower in carbon but also expensive, rather than to displace coal, which is cheaper and more abundant but also produces more emissions.
While Mr. Leonard says -- repeatedly -- that Entergy has nothing against solar or wind, "Our view is that government shouldn't be in the business of picking technologies. . . . And we're moving down a path where we're mandating renewables instead of a price signal to do it. We're . . . moving toward a planned economy by mandating a technology. Well, if we're a planned economy, if we're mandating technologies, then we don't have a whole plan."
"The focus," Mr. Leonard reiterates, "should be on developing the cap-and-trade program: Setting the amount of reductions, where we want to be, setting the price signal that works so that it's not so high that it shuts down coal plants prematurely, and that's not so low that it becomes a loophole and people don't end up doing anything -- and all we end up doing is taxing people, and God knows what the government will do with that money."
"This needs to be done with a fine pen to get it right," he adds.
Still, the government is not exactly run by omniscient technocrats. Does he believe that Congress -- with its entrenched constituencies, its own self-interest, its many antibusiness biases -- can actually create a climate system that is as sensitive and efficient as he envisions? That is, can the political class actually write the same bill that economists would write?
"That is really the tough part," Mr. Leonard says. "The trade-offs are not simple. . . . With a well-crafted bill, the market will make those choices. Or you can do it with a planned economy, and hope you get it right."
We may find out.
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The answer to this riddle use to be: 47, one to change the bulb and 46 to write the impact statement.
March 30, 2009
How many environmentalists does it take to change a light bulb?
Ethel C. Fenig
How many pretentious, earth hating, fear mongering Al Gore acolytes does it take to screw in an expensive, difficult to use, harsh, erratic and often dangerous light bulb? So many that the ever shrinking New York Times wasted valuable earth insensitive ink and destroyed trees for paper to print two articles last Friday discussing the issue. They also conveniently placed them online.
One article seriously asked "Do New Bulbs Save Energy If They Don't Work?" Duh!! Ok, wise New York Times readers, the answer is no--and they also waste money because frustrated users will resort to candles, thereby depleting oxygen and increasing the danger of fire. However, in all fairness, the paper felt compelled to ask the question because
a lot of people these days are finding the new compact fluorescent bulbs anything but simple. Consumers who are trying them say they sometimes fail to work, or wear out early. At best, people discover that using the bulbs requires learning a long list of dos and don'ts. (snip) Consumers are posting vociferous complaints on the Internet after trying the bulbs and finding them lacking.
Yes, indeed, in these complicated times no more simply buying a light bulb, screwing it in and turning on the switch. Now, in the ultimate how many (fill in the blank) does it take to screw in a light bulb joke, today's bulbs require a college graduate reading ability to interpret the warnings and instructions that accompany each bulb; the extensive written material often requires more elaborate packing with more earth unfriendly--according to environmentalists--plastic and cardboard. And so, in a second article, helpfully titled "Tips for Using Compact Fluorescent Bulbs," the NY Times distills the collected compact fluorescent bulb wisdom from Rensselaer Polytechnic Institute's Lighting Research Center, Consumer Reports, and the government (your) tax supported Energy Star program and the Environmental Protection Agency. Yep, all these institutions--and more--are needed to teach the average citizen how to use the new energy saving bulbs.
One handy tip: These so called environmentally friendly light bulbs can be extremely damaging to your health ; they contain mercury, a dangerous substance for humans.
If you break a bulb, the Environmental Protection Agency recommends precautions to avoid mercury exposure: Clear people and pets from the room and open a window for at least 15 minutes if possible. Avoid vacuuming. Scoop up larger pieces with stiff paper or cardboard, pick up smaller residue with sticky tape, and wipe the area with a damp cloth. Put everything into a sealed plastic bag or sealed glass jar. In most cases, this can be put in the trash, but the E.P.A. recommends checking local rules.
So keep those nasty plastic bags handy. Or stock up and use regular incandescent bulbs. In the long run they just might be cheaper. And safer. And more environmentally friendly.
Page Printed from: http://www.americanthinker.com/blog/2009/03/how_many_environmentalists_doe.html at March 30, 2009 - 05:57:53 PM EDT
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April 02, 2009
Dems Failure to Fast Track Cap-And-Trade a Terrific Omen
Marc Sheppard
Yesterday, a genuine bi-partisan coalition (twenty-six Democrats and forty-one Republicans) denied cap-and-trade legislation a filibuster-and-amendment-proof path through the Senate. The move effectively prevents overzealous Senators the likes of Boxer and Waxman from turning their paranoid green dreams of citizen-control into law by circumventing Senate procedures.
And while I probably wouldn’t have your eyes on loan if you thought that anything less than good news – it’s actually nothing short of tremendous news.
You see, as recently as Tuesday it appeared the climate-hysterics might succeed in attaching their dreadful stealth national sales tax scheme to the budget resolution by employing a sneaky little trick called the reconciliation process. But yesterday’s passage of an amendment put forth by freshman Senator Mike Johanns (R-Neb) forces the green ideologues to muster 60 votes instead of a simple majority to pass their inane plan. And, given yesterday’s clear message sent via vote by Democrats from home-states most overwhelmed by the financial disintegration this legislation would assure, such, thankfully, won’t be an easy task.
After all, did over two dozen Democrats suddenly have a moment of group clarity and grasp the madness of raising every American’s energy costs by thousands of dollars annually in a futile and meaningless attempt to diminish atmospheric levels of CO2? Have the decade-long cessation of warming, or the almost daily news of yet another climate expert concurring that the minuscule levels of this trace gas mankind might influence has no bearing on climate whatsoever, finally sunk in? Were the trickle-down consequences of an abrupt $2 Trillion expense to industry and utility companies debated more clearly yesterday than they had been hitherto?
Not likely. Smart money would instead be on a lack of cohesion within the Congressional Green Caucus. And why not? The latest Gallup Poll reports that 41% of Americans consider global warming an exaggeration. And a January Rasmussen poll found 44% percent believing that "long-term planetary trends are the cause of global warming.” So one must wonder -- what percentage of Senate and House Democrats remain true believers as opposed to those dutifully following party orthodoxy? And just how far will they be willing to stick their necks out to abide those tenets?
The numbers would appear to favor the sane.
Last year’s Lieberman-Warner Climate Security Act of 2008 was tabled without finding even a simple majority, let alone the required 60 votes. And 7 of the 48 Senators voting aye were Republicans. 4 of those 7 (Dole, Smith, Sununu and Warner) are gone. Of the three power-RINOs (PRs), Specter abstained while only Collins and Snowe did what Collins and Snowe typically do.
Furthermore, the 650 page draft of the American Clean Energy and Security Act of 2009 [PDF], which actually trumps both Obama’s proposals and Lieberman-Warner in its draconian progress penalization, has virtually no GOP support. None. Not even among the three PRs.
But even should all three be once again tempted by some earmarked snake, the Dems must limit the number of their ranks shuffling across the aisle to one, and that’s not likely. 4 Senate Democrats voted against Lieberman-Warner last year. And 26 risked the wild wrath of Barbara “There Will Be Flood” Boxer -- who desperately attempted to block the Johanns amendment with one of her own – yesterday to assure the appropriate 60% vote condition. And one -- Louisiana’s Mary Landrieu -- was even wise enough to do both.
Word has it Boxer flipped out after the vote. And who can blame her? Her baby is drowning in the cooling, stable-leveled Sea the locals call Reality.
Indeed, the Senate eco-maniacs appear to be losing their grip -- in more ways than one. And after their cap-and-trade con-job officially nose-dives this year, it may well be headed to the dustbin of dreadful ideas it belongs in for the foreseeable future. And the serene sanity of that decision, in turn, may just bridle our emissaries at the Battle of Copenhagen come December.
As I said, yesterday’s vote was tremendous news.
Page Printed from: http://www.americanthinker.com/blog/2009/04/dems_failure_to_fast_track_cap.html at April 02, 2009 - 08:21:47 PM EDT
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The same sort of lame idealism and science massaged for a political end that brought us this now has free rein in the executive branch:
Report: Ethanol raises cost of nutrition programs
By MARY CLARE JALONICK, Thu Apr 9, 10:02 pm ET
WASHINGTON – The increased use of ethanol could cost the government up to $900 million for food stamps and child nutrition programs, a congressional report says.
Higher use of the corn-based fuel additive accounted for about 10 percent to 15 percent of the rise in food prices between April 2007 and April 2008, according to the nonpartisan Congressional Budget Office. That translates into higher costs for food programs for the needy.
The CBO said other factors, such as skyrocketing energy costs, had an even greater impact than ethanol on food prices during that period. Economists there estimate that increased costs for food programs overall due to higher food prices will be about $5.3 billion in the current budget year.
Ethanol's impact on future food prices is uncertain, the report says, because an increased supply of corn has the potential to eventually lower food prices.
Roughly one quarter of corn grown in the United States is now used to produce ethanol, and overall consumption of ethanol in the country hit a record high last year, exceeding 9 billion gallons, according to the CBO. Nearly 3 billion bushels of corn were used to produce ethanol in the United States last year — an increase of almost a billion bushels over 2007.
The demand for ethanol was one factor that increased corn prices, leading to higher animal feed and ingredient costs for farmers, ranchers and food manufacturers. Some of that cost is eventually passed on to consumers, since corn is used in so many food products.
Several of those affected groups have banded together to oppose tax breaks and federal mandates for the fuel. They said Thursday that the report shows the unintended consequences of ethanol.
"As startling as these figures are, they do not even tell the story of the toll higher food prices have taken on working families, nor the impact higher feed prices have had on farmers in animal agriculture who have seen staggering losses and job cuts and liquidation of livestock herds," the Grocery Manufacturers Association, American Meat Institute, National Turkey Federation and National Council of Chain Restaurants said in a statement.
Supporters of ethanol disagreed, saying the report was good news.
"The report released by the Congressional Budget Office confirms what we've known for some time: The impact of ethanol production on food prices is minimal and that energy was the main driver in the rise of food prices," said Tom Buis, CEO of Growth Energy, an ethanol industry group.
Ethanol producers asked the Environmental Protection Agency last month to increase the amount of ethanol that refiners can blend with gasoline from a maximum of 10 percent to 15 percent, which could boost the demand for ethanol by as much as 6 billion gallons a year. They said raising that cap would create thousands of new jobs.
Agriculture Secretary Tom Vilsack has said he believes the administration could move quickly to raise the cap to at least 12 or 13 percent, but the EPA has not yet made a final decision.
The report also looked at ethanol's effects on greenhouse gas emissions, acknowledging that over time ethanol's benefits over gasoline could diminish. The report says the use of ethanol reduced gasoline consumption by about 4 percent last year and reduced the gases blamed for global warming from the burning of gasoline by less than 1 percent. But the clearing of cropland and forests to produce more ethanol could more than offset those reductions.
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Who'd of thunk it, there are benefits and costs associated with "renewable energey," too. Now the greenies have some fratricidal problems to contend with.
Renewable Energy's Environmental Paradox
Wind and Solar Projects May Carry Costs for Wildlife
By Juliet Eilperin and Steven Mufson
Washington Post Staff Writers
Thursday, April 16, 2009
The SunZia transmission line that would link sun and wind power from central New Mexico with cities in Arizona is just the sort of energy project an environmentalist could love -- or hate. And it is just the sort of line the Interior Department has been tasked with promoting -- or guarding against.
If built, the 460-mile line would carry about 3,000 megawatts of power, enough to avoid the need for a handful of coal-fired plants and to help utilities meet mandated targets for use of renewable fuel. "We have to connect the sun of the deserts and the winds of the plains to places where people live," Interior Secretary Ken Salazar said recently.
But the line would also cross grasslands, skirt two national wildlife refuges and traverse the Rio Grande, all habitat areas rich in wildlife. The graceful sandhill crane, for example, makes its winter home in the wetlands of New Mexico's Bosque del Apache National Wildlife Refuge, right next to the path of the proposed power line. And much of the area falls under the protection of the Interior Department's Bureau of Land Management (BLM).
Renewable-energy development, which the Obama administration has made a priority, is posing conflicts between economic interests and environmental concerns, not entirely unlike the way offshore oil and gas development pits economics against environment. But because of concerns about climate, many environmentalists and government agencies could find themselves straddling both sides, especially in Western states where the federal government is a major landowner.
"Everybody in New Mexico loves the sandhill cranes," said Ned Farquhar, a former aide to New Mexico Gov. Bill Richardson (D). "We also love our renewable energy. So we have to figure this out."
Farquhar made that comment a month ago when he was working for the Natural Resources Defense Council. Since then, he has been appointed head of the BLM -- in charge of figuring it out.
As the push for renewable-energy development intensifies across the United States, scientists and activists have begun to voice concern that policymakers have underestimated the environmental impact of projects that are otherwise "green."
"There is no free lunch when it comes to meeting our energy needs," said Johanna Wald, a senior lawyer at the Natural Resources Defense Council. She added, however, that the renewables boom "offers a chance to do it right."
"We want to do it differently compared to how we did oil and gas development," she said.
There is no question that permit applications for renewable-energy projects are on the rise, especially on federal land in the West. According to Ray Brady, leader of the BLM's energy policy team, the bureau has received 199 applications for solar projects encompassing 1.7 million acres of land, though only two of them have undergone environmental assessments.
The agency has already authorized 206 wind projects -- 28 of them to generate power, the rest primarily to test a region's wind-generation capacity -- and at least 200 more are awaiting approval.
The fact that eight Western states have established "renewable portfolio standards" has accelerated the push for new projects, Brady said, because those policies are forcing utilities to find additional renewable sources of electricity.
"For all of these reasons, BLM does have a challenge because of the additional work involved," said Brady, who predicted that the agency may hire as many as 100 people just to work on renewable-energy permits. "Clearly there's an interest in expediting and streamlining the process. However, we need to make the right decisions that are based on the best science."
One of the biggest challenges renewable-energy projects pose is that they often take up much more land than conventional sources, such as coal-fired power plants. A team of scientists, several of whom work for the Nature Conservancy, has written a paper that will appear in the journal PLoS One showing that it can take 300 times as much land to produce a given amount of energy from soy biodiesel as from a nuclear power plant. Regardless of the climate policy the nation adopts, the paper predicts that by 2030, energy production will occupy an additional 79,537 square miles of land.
The impact will be "substantial," said Jimmie Powell, the Nature Conservancy's national energy leader and one of the paper's co-authors. "It's important to know where the footprint is going to be."
In some cases, scientists are just beginning to discover the unintended effect of projects such as wind turbines. Grassland birds such as the lesser prairie chicken and the greater sage grouse, both of which are candidates for listing under the Endangered Species Act, appear to avoid vertical structures such as wind turbines and transmission-line towers. This is proving to be a problem in states such as Kansas, an ideal site for wind power, because as more turbines are built, lesser prairie chickens will confine themselves to narrow ranges, fragmenting a population that must be connected to survive.
"Nobody knows what's in the bird's head, but presumably there's an inherited behavior that allows the birds to avoid avian predators who could perch overhead," said Michael Bean, wildlife director for the Environmental Defense Fund, an advocacy group.
The U.S. Fish and Wildlife Service has proposed requiring that developers keep wind turbines at least five miles away from a prairie grouse lek, or mating area, but the wind industry has resisted this idea.
Ditlev Engel, president and chief executive of the Danish wind-energy company Vestas, said anecdotal evidence about birds being caught in turbine blades and other environmental horror stories do not usually hold up under scrutiny.
"Do people think it's better all those birds are breathing CO2? I'm not a scientist, but I doubt it," said Engel, whose company is expanding its U.S. manufacturing and distribution operations. "Let's get the facts on the table and not the feelings. The fact is, these are not issues."
In many instances, producers of renewable energy are coordinating with environmental groups and federal agencies to try to map out the best locations for energy production, whether in the West or offshore. The Natural Resources Defense Council and the National Audubon Society have created an online mapping project, using Google Earth, of 13 Western states to show where renewable projects would have the most impact. Out of the 860 million acres in those states, for example, there are 10,000 conservation areas, and 128 million acres are off limits to energy development.
In the case of SunZia, the company has been working to minimize the impact of its proposed transmission line. Tom Wray, manager of generation and transmission projects, said that as much as 80 percent of the line's path would parallel existing lines. He said that it would cross the Rio Grande north of the sandhill crane's flyway and that it would zig and zag to skirt environmentally sensitive areas. Every mile added to the length of the line, however, would add about $1 million to the project.
"We're not aware of any threatened or endangered species habitat or impact issues that we can't mitigate or deal with," Wray said.
Lawrence A. Selzer, president of the Conservation Fund, said the new administration is eager to advance these projects without alienating environmentalists. "The answer from President Obama can't be no," he said. "They've got to find a way to say yes."
(http://media3.washingtonpost.com/wp-dyn/content/graphic/2009/04/16/GR2009041600093.gif)
http://www.washingtonpost.com/wp-dyn/content/article/2009/04/15/AR2009041503622.html
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Peter W. Huber
Bound to Burn, http://city-journal.org/2009/19_2_carbon.html
Like medieval priests, today’s carbon brokers will sell you an indulgence that forgives your carbon sins. It will run you about $500 for 5 tons of forgiveness—about how much the typical American needs every year. Or about $2,000 a year for a typical four-person household. Your broker will spend the money on such things as reducing methane emissions from hog farms in Brazil.
But if you really want to make a difference, you must send a check large enough to forgive the carbon emitted by four poor Brazilian households, too—because they’re not going to do it themselves. To cover all five households, then, send $4,000. And you probably forgot to send in a check last year, and you might forget again in the future, so you’d best make it an even $40,000, to take care of a decade right now. If you decline to write your own check while insisting that to save the world we must ditch the carbon, you are just burdening your already sooty soul with another ton of self-righteous hypocrisy. And you can’t possibly afford what it will cost to forgive that.
If making carbon this personal seems rude, then think globally instead. During the presidential race, Barack Obama was heard to remark that he would bankrupt the coal industry. No one can doubt Washington’s power to bankrupt almost anything—in the United States. But China is adding 100 gigawatts of coal-fired electrical capacity a year. That’s another whole United States’ worth of coal consumption added every three years, with no stopping point in sight. Much of the rest of the developing world is on a similar path.
Cut to the chase. We rich people can’t stop the world’s 5 billion poor people from burning the couple of trillion tons of cheap carbon that they have within easy reach. We can’t even make any durable dent in global emissions—because emissions from the developing world are growing too fast, because the other 80 percent of humanity desperately needs cheap energy, and because we and they are now part of the same global economy. What we can do, if we’re foolish enough, is let carbon worries send our jobs and industries to their shores, making them grow even faster, and their carbon emissions faster still.
We don’t control the global supply of carbon.
Ten countries ruled by nasty people control 80 percent of the planet’s oil reserves—about 1 trillion barrels, currently worth about $40 trillion. If $40 trillion worth of gold were located where most of the oil is, one could only scoff at any suggestion that we might somehow persuade the nasty people to leave the wealth buried. They can lift most of their oil at a cost well under $10 a barrel. They will drill. They will pump. And they will find buyers. Oil is all they’ve got.
Poor countries all around the planet are sitting on a second, even bigger source of carbon—almost a trillion tons of cheap, easily accessible coal. They also control most of the planet’s third great carbon reservoir—the rain forests and soil. They will keep squeezing the carbon out of cheap coal, and cheap forest, and cheap soil, because that’s all they’ve got. Unless they can find something even cheaper. But they won’t—not any time in the foreseeable future.
We no longer control the demand for carbon, either. The 5 billion poor—the other 80 percent—are already the main problem, not us. Collectively, they emit 20 percent more greenhouse gas than we do. We burn a lot more carbon individually, but they have a lot more children. Their fecundity has eclipsed our gluttony, and the gap is now widening fast. China, not the United States, is now the planet’s largest emitter. Brazil, India, Indonesia, South Africa, and others are in hot pursuit. And these countries have all made it clear that they aren’t interested in spending what money they have on low-carb diets. It is idle to argue, as some have done, that global warming can be solved—decades hence—at a cost of 1 to 2 percent of the global economy. Eighty percent of the global population hasn’t signed on to pay more than 0 percent.
Accepting this last, self-evident fact, the Kyoto Protocol divides the world into two groups. The roughly 1.2 billion citizens of industrialized countries are expected to reduce their emissions. The other 5 billion—including both China and India, each of which is about as populous as the entire Organisation for Economic Co-operation and Development—aren’t. These numbers alone guarantee that humanity isn’t going to reduce global emissions at any point in the foreseeable future—unless it does it the old-fashioned way, by getting poorer. But the current recession won’t last forever, and the long-term trend is clear. Their populations and per-capita emissions are rising far faster than ours could fall under any remotely plausible carbon-reduction scheme.
Might we simply buy their cooperation? Various plans have circulated for having the rich pay the poor to stop burning down rain forests and to lower greenhouse-gas emissions from primitive agricultural practices. But taking control of what belongs to someone else ultimately means buying it. Over the long term, we would in effect have to buy up a large fraction of all the world’s forests, soil, coal, and oil—and then post guards to make sure that poor people didn’t sneak in and grab all the carbon anyway. Buying off people just doesn’t fly when they outnumber you four to one.
Might we instead manage to give the world something cheaper than carbon? The moon-shot law of economics says yes, of course we can. If we just put our minds to it, it will happen. Atom bomb, moon landing, ultracheap energy—all it takes is a triumph of political will.
Really? For the very poorest, this would mean beating the price of the free rain forest that they burn down to clear land to plant a subsistence crop. For the slightly less poor, it would mean beating the price of coal used to generate electricity at under 3 cents per kilowatt-hour.
And with one important exception, which we will return to shortly, no carbon-free fuel or technology comes remotely close to being able to do that. Fossil fuels are extremely cheap because geological forces happen to have created large deposits of these dense forms of energy in accessible places. Find a mountain of coal, and you can just shovel gargantuan amounts of energy into the boxcars.
Shoveling wind and sun is much, much harder. Windmills are now 50-story skyscrapers. Yet one windmill generates a piddling 2 to 3 megawatts. A jumbo jet needs 100 megawatts to get off the ground; Google is building 100-megawatt server farms. Meeting New York City’s total energy demand would require 13,000 of those skyscrapers spinning at top speed, which would require scattering about 50,000 of them across the state, to make sure that you always hit enough windy spots. To answer the howls of green protest that inevitably greet realistic engineering estimates like these, note that real-world systems must be able to meet peak, not average, demand; that reserve margins are essential; and that converting electric power into liquid or gaseous fuels to power the existing transportation and heating systems would entail substantial losses. What was Mayor Bloomberg thinking when he suggested that he might just tuck windmills into Manhattan? Such thoughts betray a deep ignorance about how difficult it is to get a lot of energy out of sources as thin and dilute as wind and sun.
It’s often suggested that technology improvements and mass production will sharply lower the cost of wind and solar. But engineers have pursued these technologies for decades, and while costs of some components have fallen, there is no serious prospect of costs plummeting and performance soaring as they have in our laptops and cell phones. When you replace conventional with renewable energy, everything gets bigger, not smaller—and bigger costs more, not less. Even if solar cells themselves were free, solar power would remain very expensive because of the huge structures and support systems required to extract large amounts of electricity from a source so weak that it takes hours to deliver a tan.
This is why the (few) greens ready to accept engineering and economic reality have suddenly emerged as avid proponents of nuclear power. In the aftermath of the Three Mile Island accident—which didn’t harm anyone, and wouldn’t even have damaged the reactor core if the operators had simply kept their hands off the switches and let the automatic safety systems do their job—ostensibly green antinuclear activists unwittingly boosted U.S. coal consumption by about 400 million tons per year. The United States would be in compliance with the Kyoto Protocol today if we could simply undo their handiwork and conjure back into existence the nuclear plants that were in the pipeline in nuclear power’s heyday. Nuclear power is fantastically compact, and—as America’s nuclear navy, several commercial U.S. operators, France, Japan, and a handful of other countries have convincingly established—it’s both safe and cheap wherever engineers are allowed to get on with it.
But getting on with it briskly is essential, because costs hinge on the huge, up-front capital investment in the power plant. Years of delay between the capital investment and when it starts earning a return are ruinous. Most of the developed world has made nuclear power unaffordable by surrounding it with a regulatory process so sluggish and unpredictable that no one will pour a couple of billion dollars into a new plant, for the good reason that no one knows when (or even if) the investment will be allowed to start making money.
And countries that don’t trust nuclear power on their own soil must hesitate to share the technology with countries where you never know who will be in charge next year, or what he might decide to do with his nuclear toys. So much for the possibility that cheap nuclear power might replace carbon-spewing sources of energy in the developing world. Moreover, even India and China, which have mastered nuclear technologies, are deploying far more new coal capacity.
Remember, finally, that most of the cost of carbon-based energy resides not in the fuels but in the gigantic infrastructure of furnaces, turbines, and engines. Those costs are sunk, which means that carbon-free alternatives—with their own huge, attendant, front-end capital costs—must be cheap enough to beat carbon fuels that already have their infrastructure in place. That won’t happen in our lifetimes.
Another argument commonly advanced is that getting over carbon will, nevertheless, be comparatively cheap, because it will get us over oil, too—which will impoverish our enemies and save us a bundle at the Pentagon and the Department of Homeland Security. But uranium aside, the most economical substitute for oil is, in fact, electricity generated with coal. Cheap coal-fired electricity has been, is, and will continue to be a substitute for oil, or a substitute for natural gas, which can in turn substitute for oil. By sharply boosting the cost of coal electricity, the war on carbon will make us more dependent on oil, not less.
The first place where coal displaces oil is in the electric power plant itself. When oil prices spiked in the early 1980s, U.S. utilities quickly switched to other fuels, with coal leading the pack; the coal-fired plants now being built in China, India, and other developing countries are displacing diesel generators. More power plants burning coal to produce cheap electricity can also mean less natural gas used to generate electricity. And less used for industrial, commercial, and residential heating, welding, and chemical processing, as these users switch to electrically powered alternatives. The gas that’s freed up this way can then substitute for diesel fuel in heavy trucks, delivery vehicles, and buses. And coal-fired electricity will eventually begin displacing gasoline, too, as soon as plug-in hybrid cars start recharging their batteries directly from the grid.
To top it all, using electricity generated in large part by coal to power our passenger cars would lower carbon emissions—even in Indiana, which generates 75 percent of its electricity with coal. Big power plants are so much more efficient than the gasoline engines in our cars that a plug-in hybrid car running on electricity supplied by Indiana’s current grid still ends up more carbon-frugal than comparable cars burning gasoline in a conventional engine under the hood. Old-guard energy types have been saying this for decades. In a major report released last March, the World Wildlife Fund finally concluded that they were right all along.
But true carbon zealots won’t settle for modest reductions in carbon emissions when fat targets beckon. They see coal-fired electricity as the dragon to slay first. Huge, stationary sources can’t run or hide, and the cost of doing without them doesn’t get rung up in plain view at the gas pump. California, Pennsylvania, and other greener-than-thou states have made flatlining electricity consumption the linchpin of their war on carbon. That is the one certain way to halt the displacement of foreign oil by cheap, domestic electricity.
The oil-coal economics come down to this. Per unit of energy delivered, coal costs about one-fifth as much as oil—but contains one-third more carbon. High carbon taxes (or tradable permits, or any other economic equivalent) sharply narrow the price gap between oil and the one fuel that can displace it worldwide, here and now. The oil nasties will celebrate the green war on carbon as enthusiastically as the coal industry celebrated the green war on uranium 30 years ago.
The other 5 billion are too poor to deny these economic realities. For them, the price to beat is 3-cent coal-fired electricity. China and India won’t trade 3-cent coal for 15-cent wind or 30-cent solar. As for us, if we embrace those economically frivolous alternatives on our own, we will certainly end up doing more harm than good.
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Sorry it didn't fit in one post. This is very important information. Please read the previous post first although the first paragraph here will tell you why cap and trade won't work. (Crafty, please explain your objection to nuclear power when you have time.)
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By pouring money into anything-but-carbon fuels, we will lower demand for carbon, making it even cheaper for the rest of the world to buy and burn. The rest will use cheaper energy to accelerate their own economic growth. Jobs will go where energy is cheap, just as they go where labor is cheap. Manufacturing and heavy industry require a great deal of energy, and in a global economy, no competitor can survive while paying substantially more for an essential input. The carbon police acknowledge the problem and talk vaguely of using tariffs and such to address it. But carbon is far too deeply embedded in the global economy, and materials, goods, and services move and intermingle far too freely, for the customs agents to track.
Consider your next Google search. As noted in a recent article in Harper’s, “Google . . . and its rivals now head abroad for cheaper, often dirtier power.” Google itself (the “don’t be evil” company) is looking to set up one of its electrically voracious server farms at a site in Lithuania, “disingenuously described as being near a hydroelectric dam.” But Lithuania’s grid is 0.5 percent hydroelectric and 78 percent nuclear. Perhaps the company’s next huge farm will be “near” the Three Gorges Dam in China, built to generate over three times as much power as our own Grand Coulee Dam in Washington State. China will be happy to play along, while it quietly plugs another coal plant into its grid a few pylons down the line. All the while, of course, Google will maintain its low-energy headquarters in California, a state that often boasts of the wise regulatory policies—centered, one is told, on efficiency and conservation—that have made it such a frugal energy user. But in fact, sky-high prices have played the key role, curbing internal demand and propelling the flight from California of power plants, heavy industries, chip fabs, server farms, and much else (see “California’s Potemkin Environmentalism,” Spring 2008).
So the suggestion that we can lift ourselves out of the economic doldrums by spending lavishly on exceptionally expensive new sources of energy is absurd. “Green jobs” means Americans paying other Americans to chase carbon while the rest of the world builds new power plants and factories. And the environmental consequences of outsourcing jobs, industries, and carbon to developing countries are beyond dispute. They use energy far less efficiently than we do, and they remain almost completely oblivious to environmental impacts, just as we were in our own first century of industrialization. A massive transfer of carbon, industry, and jobs from us to them will raise carbon emissions, not lower them.
The grand theory for how the developed world can unilaterally save the planet seems to run like this. We buy time for the planet by rapidly slashing our own emissions. We do so by developing carbon-free alternatives even cheaper than carbon. The rest of the world will then quickly adopt these alternatives, leaving most of its trillion barrels of oil and trillion tons of coal safely buried, most of the rain forests standing, and most of the planet’s carbon-rich soil undisturbed. From end to end, however, this vision strains credulity.
Perhaps it’s the recognition of that inconvenient truth that has made the anti-carbon rhetoric increasingly apocalyptic. Coal trains have been analogized to boxcars headed for Auschwitz. There is talk of the extinction of all humanity. But then, we have heard such things before. It is indeed quite routine, in environmental discourse, to frame choices as involving potentially infinite costs on the green side of the ledger. If they really are infinite, no reasonable person can quibble about spending mere billions, or even trillions, on the dollar side, to dodge the apocalyptic bullet.
Thirty years ago, the case against nuclear power was framed as the “Zero-Infinity Dilemma.” The risks of a meltdown might be vanishingly small, but if it happened, the costs would be infinitely large, so we should forget about uranium. Computer models demonstrated that meltdowns were highly unlikely and that the costs of a meltdown, should one occur, would be manageable—but greens scoffed: huge computer models couldn’t be trusted. So we ended up burning much more coal. The software shoe is on the other foot now; the machines that said nukes wouldn’t melt now say that the ice caps will. Warming skeptics scoff in turn, and can quite plausibly argue that a planet is harder to model than a nuclear reactor. But that’s a detail. From a rhetorical perspective, any claim that the infinite, the apocalypse, or the Almighty supports your side of the argument shuts down all further discussion.
To judge by actions rather than words, however, few people and almost no national governments actually believe in the infinite rewards of exorcising carbon from economic life. Kyoto has hurt the anti-carbon mission far more than carbon zealots seem to grasp. It has proved only that with carbon, governments will say and sign anything—and then do less than nothing. The United States should steer well clear of such treaties because they are unenforceable, routinely ignored, and therefore worthless.
If we’re truly worried about carbon, we must instead approach it as if the emissions originated in an annual eruption of Mount Krakatoa. Don’t try to persuade the volcano to sign a treaty promising to stop. Focus instead on what might be done to protect and promote the planet’s carbon sinks—the systems that suck carbon back out of the air and bury it. Green plants currently pump 15 to 20 times as much carbon out of the atmosphere as humanity releases into it—that’s the pump that put all that carbon underground in the first place, millions of years ago. At present, almost all of that plant-captured carbon is released back into the atmosphere within a year or so by animal consumers. North America, however, is currently sinking almost two-thirds of its carbon emissions back into prairies and forests that were originally leveled in the 1800s but are now recovering. For the next 50 years or so, we should focus on promoting better land use and reforestation worldwide. Beyond that, weather and the oceans naturally sink about one-fifth of total fossil-fuel emissions. We should also investigate large-scale options for accelerating the process of ocean sequestration.
Carbon zealots despise carbon-sinking schemes because, they insist, nobody can be sure that the sunk carbon will stay sunk. Yet everything they propose hinges on the assumption that carbon already sunk by nature in what are now hugely valuable deposits of oil and coal can be kept sunk by treaty and imaginary cheaper-than-carbon alternatives. This, yet again, gets things backward. We certainly know how to improve agriculture to protect soil, and how to grow new trees, and how to maintain existing forests, and we can almost certainly learn how to mummify carbon and bury it back in the earth or the depths of the oceans, in ways that neither man nor nature will disturb. It’s keeping nature’s black gold sequestered from humanity that’s impossible.
If we do need to do something serious about carbon, the sequestration of carbon after it’s burned is the one approach that accepts the growth of carbon emissions as an inescapable fact of the twenty-first century. And it’s the one approach that the rest of the world can embrace, too, here and now, because it begins with improving land use, which can lead directly and quickly to greater prosperity. If, on the other hand, we persist in building green bridges to nowhere, we will make things worse, not better. Good intentions aren’t enough. Turned into ineffectual action, they can cost the earth and accelerate its ruin at the same time.
- Peter Huber is a senior fellow at the Manhattan Institute
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I posted recently Peter Huber's logic of why cap and trade legislation won't reduce carbon emissions on earth. I was reading some of his older writings and note that he predicted the following about 2 years ago:
"If you're 40 or older, you're going to spend the rest of your life powered by carbon or uranium. Take your pick. Forget about "none of the above" or "less of both." For the next several decades at least, alternative energy sources aren't serious choices; they are pork barrels, delusions, demonstration plants and daydreams."
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If you are going to plug in our vehicles someday for cheaper power and lower oil consumption, we are going to need more electricity on the grid. For the most part that will be coal or nuclear. One is a heavy carbon emitter. One is carbon-free, compact, cheap, safe and clean. You make the call!
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Could this fellow traveler fratricide turn into a trend?
April 30, 2009
Solar Energy Meets Greenies and Big Labor
By Richard Henry Lee
It was a squirrel, a labor group and an environmental group along with California's tough environmental regulations, which helped kill a hybrid solar power plant project for a Mojave Desert city.
It seemed like a good idea at the time. The City of Victorville prides itself on being a green city. They recently bought a number of hybrid vehicles for their city fleet. And they are located in the Mojave Desert which receives large amounts of sunshine every year.
When California Governor, Arnold Schwarzenegger (R), signed legislation that requires a portion of additional electric power generation to be sustainable, the City proposed a hybrid solar electric power plant. The plant would combine a solar thermal powered system along with a natural gas fired system.
After much fanfare at the start, the project began to run into problems during the permitting phase. The California Environmental Quality Act (CEQA) imposes a strict review process. The California Energy Commission (CEC) is the state agency that conducts the environmental review.
The first problem was the squirrel, or more specifically, the Mohave ground squirrel, which is considered to be threatened. While the squirrel has never been found at the project site, nor was there any evidence it had ever lived there, it could decide sometime in the future to live there. As a result, the California Department of Fish and Game decided that the squirrel required a mitigation ratio of 3:1. This means that 3 acres of the desert needs to be purchased and set aside for the squirrel for every acre of project site. This increased costs dramatically since there were few parcels available for set aside.
Next was the labor union group called CURE, which is an acronym for California Unions for Reliable Energy. CURE is supported by various construction unions. It has a history of fighting new projects in California unless the applicant agrees to use union labor for the project.
In February 2008, the Sacramento Bee editorialized:
Labor unions are an even larger abuser of CEQA. In recent years, labor groups have used environmental lawsuits, or the threat of such suits, to stop or slow down power plant construction, hospital expansions and housing developments. The unions' lawyers always seem to disappear once a developer has signed an agreement to hire only union labor...
For several years, a group called California Unions for Reliable Energy has used CEQA to slow or block power plants, including a geothermal plant in Imperial County. As it happens, CURE employs a law firm founded by Tom Adams, the current president of the California League of Conservation Voters.
CURE petitioned the CEC to become an intervenor in the review process and it was granted. CURE then began to request a lengthy data request of 152 items about the project. For example, they inquired "whether the City would implement a noxious weed preventive program"
When the CEC finally ruled against the various objections that CURE raised, the labor group then filed suit against the local air quality district in Superior Court which eventually ruled against CURE.
Then the Natural Resources Defense Council gets involved. The City tried to purchase pollution credits from the Los Angeles air basin for the natural gas portion of the plant since there were not enough local credits for purchase. But the NRDC filed suit against the purchase and prevailed. The NRDC bills itself at "The Earth's Best Defense".
The delays and burdensome requirements were costly to the City. For a while they tried to sell the project, but there were no buyers. Finally, the City ran into cash flow problems and could not pay General Electric for the steam turbines for the plant. Right now, GE is seeking to find ways to recover its costs. A couple of weeks ago, GE terminated its contract with the City and demanded immediate payment. According to the Daily Press in Victorville:
Those terms allow GE to keep Victorville's $50 million deposit on the equipment, plus either demand a $108 million termination fee or take control of the Victorville 2 power plant.
The City has few options at this point, but the price tag GE demands could force the City into bankruptcy.
It is possible that the project could still be built if GE decides take control over it, but the stiff environmental conditions would still have to be met.
In addition to these woes, the City is under investigation by a grand jury for financial dealings and S&P has downgraded several City bonds to junk status.
This story about going green in California may be repeated elsewhere in the state under the burdensome California requirements. While Gov. Schwarzenegger restates his commitment to going green, the reality is that the State's regulatory climate discourages green energy.
The unions and the environmental groups purportedly support green projects, but they in fact, often oppose them for environmental reasons. And Senator Diane Feinstein (D-CA) recently expressed opposition to solar panels in the Mojave Desert which is ideally suited for solar power in the state.
The green energy projects were supposed to create jobs for California workers according to Schwarzenegger. However, while there were jobs created for this project, many of those jobs went to lawyers.
Without these green projects, California may eventually face more blackouts. If it happens, the blame will fall squarely on the green lobby which advocates out of both sides of their collective mouths. They say they want green energy, but they will not support green energy.
The Main Stream Media are also complicit since they have been silent about the Victorville fiasco and similar projects. The only news coverage is in the local newspaper and in trade journals.
Page Printed from: http://www.americanthinker.com/2009/04/solar_energy_meets_greenies_an.html at April 30, 2009 - 09:11:43 AM EDT
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When I see stuff like this all I can think of how exhausting this all is. I just say enough already. I am picturing this dumb stupid little broad in my mind. Where do they grow liberals like this I ask? ("thrifty chicks"?):
By Amy Hardin Turosak Amy Hardin Turosak – Thu Apr 30, 5:00 am ET
Denver – Thanks to the Food and Drug Administration (FDA), I see that my serving of Honey Nut Cheerios has 110 calories. This, along with dozens of other data points on the box, helps me make educated choices to do right by my body. I'm ready to tackle the day as an informed consumer of food.
Wait! That box: What "ingredients" went into that? Ditto for the plastic liner and all those O's: How many "calories" did it take to manufacture them and then ship them to my table? What's the carbon footprint of my breakfast?
At the store, I can compare cereal carbohydrates but I can't compare how much they cost the planet. I'm not empowered to shop right by the health of the planet. I might as well put on a blindfold.
Americans need to broaden their understanding of energy and its cost. Nearly everything in our homes, from toasters to hair dryers, consumes energy (and emits pollution) from start to finish. But we don't think about that. We think that's the job of the energy companies. We turn down the thermostat and buy reusable bags at the grocery store, but that's about it.
Americans are voracious shoppers. We use more than our fair share of resources in this world. To embrace conservation, shouldn't we consider a product's carbon cost? Take appliances. Many come with an Energy Star rating. We all nod and feel good about it. But this label just shows the relative energy cost of ownership, not the absolute cost of manufacture. I wonder if it is confused with the car device OnStar; consumers may think washers have satellite connections offering emergency assistance for grass stains.
Think about all those products that companies dare to call "green." Unlike "organic," which is a federally regulated label, companies can affix "green" to just about anything, even petroleum-based plastic Easter eggs from China! Head slap. The manufacturers can't be trusted – they're colorblind. By "green," they must mean the color of money. Unless they start making edible sofas, this is beyond the FDA's scope, so who is going to settle this issue?
Misconceptions abound. Most runners don't think they have a negative environmental impact. The runner just runs, right? Hats off to Runner's World magazine for taking a hard look at this question in "The Runner's Footprint." The article showed that the carbon cost associated with a shoe's life cycle can be eye-popping. My husband is a runner. Runners don't like air pollution. So I know a shoe's carbon cost would weigh heavily on his choice.
If price and quality were equal, which widget would you buy – the one that cost 10,000 carbon points or 100? From jeans to washing machines, we need a common metric for the pollution costs that products incur during their life cycles. If we can list the nutritional value of a pickled egg, surely we can drive a healthier market and planet through system-cost comparison.
While we wait for that, we don't have to wait to be smarter shoppers. When we spend money on new products, we spend a great many carbon points. But when we buy repurposed goods at thrift stores, we spend close to zero carbon points. We have choices, but we need to be informed to make responsible ones.
Amy Hardin Turosak writes as Ms. Shopping Golightly at the Thrifty Chicks blog.
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Cap-and-Tax is a Jobs Destroyer: Part 1 in a 10-Part Series
Posted April 30th, 2009 at 5.24pm in Energy and Environment, Ongoing Priorities.
Policymakers in Washington want to dramatically change America’s energy policy by regulating carbon dioxide emissions. Their most popular idea, included in the Waxman-Markey 2009 energy bill, is a cap and trade proposal.
Many Americans find the debate in Washington over adopting a cap-and-trade program to reduce carbon dioxide a bit confusing. It works like this: Policymakers set a cap on the amount of carbon dioxide and other greenhouse gases that can be omitted into the atmosphere. Each power plant, factory, refinery, and other regulated entity will be allocated allowances (rights to emit) six greenhouse gases. However, only a certain percentage of the allowances will be allocated to these entities. The remaining percentage will be auctioned off or distributed to other emitting entities. Most emitters will need to purchase at least some allowances at auction. Emitters who reduce their emissions below their annual allotment can sell their excess allowances to those who do not–the trade part of cap-and-trade. Over time, the cap would be ratcheted down, requiring greater cuts in emissions
Put simply, it’s a tax on energy consumption. In fact, it would act as a huge tax. If enacted, cap-and-trade will be one of the government’s largest revenue sources within the next decade. Since 85 percent of our energy demand is met through fossil fuels, increasing the costs of energy will have significant economic consequences.
Most notably, the cost of producing goods for businesses increases, and consumer demand falls for two reasons; price hikes on goods reduce demand and people have less disposable income due to higher energy prices. And since low-income households spend a larger percentage of their income on energy, higher prices hit the poor much harder.
From an economy-wide perspective, higher energy prices force businesses to make production cuts and reduce labor. Furthermore, as we see in the current recession, reduced consumer spending only exacerbates this. The overall result is increased unemployment and slow economic growth.
What about green jobs, the supposed solution to our economic woes and environmental concerns? Sure, we can use government (read: taxpayer) money to hire workers to build windmills and solar panels. There will be green job creation. But that’s only one side of the coin. Despite years of subsidies and special tax breaks, renewables provide only three percent of the nation’s energy generation. Even after taxpayer-funded subsidies, consumers must pay a premium on their energy bills for renewable energy. Consumers lose doubly, paying to fund these projects with tax dollars then paying for pricier electricity.
Circling back to the effects of higher energy prices on the economy, forcing costlier renewable energy makes the economic impact only worse. According to The Heritage Foundation’s Center for Data Analysis, job losses resulting from the Lieberman-Warner cap and trade would have surpassed 900,000 in some years. Keep in mind; this is net of any “green jobs” created. Also keep in mind; the Waxman-Markey bill is has stricter emission cut targets.
(http://blog.heritage.org/wp-content/uploads/2009/04/jobs-lost-total1.png)
It’s also worth noting that jobs are good, but they are not the end all goal. A business could hire a person to dig a hole and fill it up for eight hours a day, but how much value is that creating for society. Most people would argue not much. The big problem is resources a firm (or the government) devotes to a project like this cannot be used elsewhere in a more productive manner. Not only could the labor be used elsewhere but the firm could have used its money on a more productive project – although if a business is hiring someone to dig and fill up a hole, they probably won’t be in business for long.
A cap-and-tax has a number of problems, which will be covered in a 10-part series of blog posts, but above all else, it’s a jobs killer.
http://blog.heritage.org/2009/04/30/cap-and-tax-is-a-jobs-destroyer-part-1-in-a-10-part-series/
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Second post.
Cap and Tax Will Force You to Make Budget Cuts: Part 2 in a 10-Part Series
Posted May 1st, 2009 at 3.00pm in Energy and Environment.
On April 20, President Obama called for $100 million in budget cuts after announcing spending increases of $4 trillion. Heritage Senior Policy Analyst Brian Riedl breaks it down nicely:
• It is 1/40,000 of the federal budget;
• It is 1/7,830 the size of the recent “stimulus” bill;
• It would close 1/1,845 of this year’s budget deficit;
• It is the amount the federal government spends every 13 minutes; and
• For a family earning $40,000 annually, it is the equivalent of cutting $1 from their family budget.
But if President Obama were to sign a cap and trade bill into law, he would have to call for familial budget cuts much greater than one dollar. (For a brief explanation of how cap and trade works, go here.) As recently acknowledged by a top White House official, a global warming tax could generate as much as $1.9 trillion in tax revenue over eight years, which amounts to a nearly $2,000 tax every year for every American household.* Add this up over the period of a few years and we’re talking about trillions of dollars in lost income for the entire U.S. economy.
The current recession is causing Americans to take a second look at their household budget. A cap and trade plan would make them look even harder.
(http://blog.heritage.org/wp-content/uploads/2009/05/cap-and-trade-budget.jpg)
*The Heritage Foundation’s Center for Data Analysis (CDA) calculations confirmed this. CDA took the CO2 allowance limits from the Lieberman-Warner cap and trade bill, which was more lax than the Waxman-Markey bill. CDA then multiplied the CO2 allowance for each year times our estimates for the allowance price for each year. The summation of these products for 8 years (2012-2019), divided by eight to get the average per year and divided that by the number of households (about 110-120 million households) gave us an average per household tax per year of nearly $2,000.
http://blog.heritage.org/2009/05/01/cap-and-tax-will-force-you-to-make-budget-cuts-part-2-in-a-10-part-series/
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Third post.
Will Cap and Trade Save the Planet? (Part 3 in a 10-part Series)
Posted May 4th, 2009 at 11.38pm in Energy and Environment.
Global warming skeptics are quick to point out the exorbitant costs of global warming legislation because they are, well, exorbitant. The $1.9 trillion of tax revenue generated over eight years from a cap-and-trade bill would still be larger than the $1.5 trillion from NASA, the New Deal, and Hurricane Katrina. It amounts to a nearly $2,000 tax every year for every American household. Projected job losses that would have resulted from the Lieberman-Warner cap and trade would have surpassed 900,000 in some years.
But if it saves the planet, isn’t it all worth it? Some radical environmental alarmists believe saving the environment should come at any cost and capitalist greed and short-sightedness is superseding the preservation of the planet for future generations.
Herein lies the problem: When the benefits of a cap and trade are measured against the costs, the costs significantly outweigh the negligible benefits. We’ve highlighted the costs in the first two parts of this series (here and here). Let’s dissect the benefits.
Analysis by the architects of an endangerment finding that would circumvent Congressional legislation to regulate carbon dioxide, the Environmental Protection Agency, strongly suggests that a 60 percent reduction in carbon-dioxide emissions by 2050 will reduce global temperature by 0.1 to 0.2 degrees Celsius by 2095. The bottom line: The extraordinary perils of carbon dioxide regulation for the American economy come with little, if any, environmental benefit.
So radical environmentalists are willing to pay anything, and more importantly, coerce others to pay heavily to save the planet. But when the benefit is barely noticeable, even that argument falls flat on its face.
There are ways, however, to improve the environment in the U.S. and abroad without burdening the economy. It begins with establishing well-defined property rights. When property rights cease to exist, people do not have the proper incentives to devote their own resources to protect and improve their land. In this instance, whats referred to as the tragedy of the commons occurs. People are much more inclined to litter in a park than their own backyards. While this has environmental consequences of its own, the damage can occur on much larger levels. Overfishing, overgrazing, forest degradation are examples of overusing the earths resources when property rights are not clearly defined. Instead of continual lobbying Congress to meet their radical agenda, environmentalist groups could use their resources to purchase some of this land and improve it themselves.
Also worth noting is that doomsday scenarios, new and old, often play out much differently than what the doomsayers projected. Economist Walter Williams writes,
It’s not just latter-day doomsayers who have been wrong; doomsayers have always been wrong. In 1885, the U.S. Geological Survey announced there was “little or no chance” of oil being discovered in California, and a few years later they said the same about Kansas and Texas. In 1939, the U.S. Department of the Interior said American oil supplies would last only another 13 years. In 1949, the Secretary of the Interior said the end of U.S. oil supplies was in sight. Having learned nothing from its earlier erroneous claims, in 1974 the U.S. Geological Survey advised us that the U.S. had only a 10-year supply of natural gas. The fact of the matter, according to the American Gas Association, there’s a 1,000 to 2,500 year supply.
Here are my questions: In 1970, when environmentalists were making predictions of manmade global cooling and the threat of an ice age and millions of Americans starving to death, what kind of government policy should we have undertaken to prevent such a calamity? When Ehrlich predicted that England would not exist in the year 2000, what steps should the British Parliament have taken in 1970 to prevent such a dire outcome? In 1939, when the U.S. Department of the Interior warned that we only had oil supplies for another 13 years, what actions should President Roosevelt have taken? Finally, what makes us think that environmental alarmism is any more correct now that they have switched their tune to manmade global warming?
Good questions.
http://blog.heritage.org/2009/05/04/will-cap-and-trade-save-the-planet-part-3-in-a-10-part-series/
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Smart energy meters in every UK home by 2020
Consumers to benefit from savings achieved through increased awareness of energy use but householders likely to pick up some of the costs of the compulsory, nationwide scheme
Smart meters will work with real-time energy displays showing energy use around the home. Photograph: Energy Retailers Association/PA
Every home in the UK must be fitted with a "smart meter" by 2020 to reduce energy use and pave the way for a low-carbon "smart grid", under plans unveiled by the government today.
The new meters will send information on real-time electricity and gas use in households and small businesses direct to utility companies, eliminating the need for customers to stay at home for meter readings or to receive over-estimated bills. However, consumers are likely to pick up some of the costs of the compulsory, nationwide scheme.
The government estimates putting smart meters in the country's 26m homes could save customers and energy companies £2.5bn-£3.6bn over the next 20 years, but says it will cost more than double this to buy and install the equipment.
Launching a consultation on how the smart meters should be rolled out, the Department for Energy and Climate Change (DECC) claimed the scheme will be the biggest smart meter project in the world.
"The meters most of us have in our homes were designed for a different age, before climate change," said Ed Miliband, the energy and climate change secretary. "Now we need to get smarter with our energy ... so it's important we design a system that brings best value to everyone involved."
Energy companies welcomed the switch, which will reduce their running costs by making meter readers obsolete and eliminating the customer service time spent on dealing with estimated bills. Consumers and small business owners could benefit from savings achieved through increased awareness of their energy use. Previous studies have shown that smart meters encourage homeowners to cut their energy use by 3-15%, although experts warn that the technology requires consumer education and is not an "install and forget" energy-efficiency measure like loft insulation.
Consumer groups warned that homeowners should not have to shoulder heavy costs for the new meters. Replacing today's meters by the end of 2020 is expected to cost £8.11bn under the government's preferred plan, with utility companies paying upfront, but able to pass on the charge. "Bill-payers have been suffering for many years from ever-increasing bills, so I hope the cost of the scheme – up to £340 for every household – won't wholly be put at their feet," said Scott Byrom, utilities manager at Moneysupermarket.com.
The Energy Retail Association – which represents the major electricity and gas companies – said that smart meters will be "cost-neutral" to customers because the savings to its members will part-fund the roll out.
Smart meters will also play a key role in helping the government meet its greenhouse gas reduction targets of at least 34% by 2020. The meters make it easier for householders to sell power they generate through wind and solar back to the grid. They will also allow suppliers to smooth the peaks and troughs of UK electricity demand by offering cheaper electricity at times of low demand, and increasing the price when demand is high. Reducing peak demand means fewer power stations need to be on standby, thereby cutting carbon emissions.
Ultimately, smart meters will allow the electricity used by domestic appliances to be "dynamically" managed. This would mean switching off refrigerators for a few minutes at times of high demand, or using plugged-in electric vehicles to store power. This flexibility is crucial if a significant amount of clean, renewable energy is to be supplied from harnessing the sun, wind and waves, all of which vary with the weather. A government report last year suggested such "demand management" technology could save 2m tonnes of CO2 a year.
Environmental campaigners and opposition politicians warned that the 2020 timetable was not fast enough. The shadow energy and climate change secretary, Greg Clark, said: "In other countries around the world, smart meters are being rolled out now. Ten years [to install] a technology that's already available seems very leisurely considering the urgency of climate change." However, consultants Ernst & Young noted that even fitting 2.6m homes with meters every until 2020 was "challenging".
Three plans are under consideration for the natiowide roll-out of smart meters. The first sees utilities take on all responsibilities, including supply and installation, plus the data management. The second – the government's preferred model – has energy suppliers responsible for the meters, but with a new third party body handling the energy data. A third scenario envisages setting up a new organisation to oversee both the meters and data management.
Smart meter trials are already under way around the country through energy companies including British Gas and Npower, and smaller suppliers such as First Utility already supply smart meters as standard. The first smart meters installed under the government's new plans are expected to arrive in 2012.
http://www.guardian.co.uk/environment/2009/may/11/smart-meters-energy-efficiency
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Second post:
White House memo challenges EPA finding on warming
By DINA CAPPIELLO, Associated Press Writer
6 mins ago
WASHINGTON – An Environmental Protection Agency proposal that could lead to regulating the gases blamed for global warming will prove costly for factories, small businesses and other institutions, according to a White House document.
The nine-page memo, released Tuesday by Republican senators, is a compilation of opinions made by numerous federal agencies prior to the EPA determining in April that greenhouse gases pose dangers to public health and welfare.
That finding set in motion the regulation of six heat-trapping gases from cars and trucks, factories and other sources under the Clean Air Act for the first time.
The document, which is labeled "Deliberative-Attorney Client Privilege," says that if the EPA proceeds with the regulation of heat-trapping gases, including carbon dioxide, factories, small businesses and institutions would be subject to costly regulation.
"Making the decision to regulate carbon dioxide ... for the first time is likely to have serious economic consequences for regulated entities throughout the U.S. economy, including small businesses and small communities," the document reads.
Republicans and business groups immediately used the document to bolster their arguments that controlling greenhouse gases would harm the economy.
They also highlighted parts of the document that find fault with how the EPA arrived at its conclusion that greenhouse gases endanger human health and welfare, since the gases by themselves do not pose any harm.
The memo says the EPA could have been "more balanced" in its analysis by also highlighting regions of the country that would benefit from global warming, such as Alaska, which would have warmer winters.
"It really appears to me that the decision was based more on political calculation than on scientific ones," said Sen. John Barrasso, R-Wyo., who called the document "a smoking gun" during a hearing Tuesday on the Obama administration's proposed budget for EPA.
"The counsel in this administration repeatedly questions the lack of scientific support that you have for this proposed finding," he said.
EPA administrator Lisa Jackson responded by saying that the finding by the EPA in April was required by law, stemming from a 2007 Supreme Court decision that said the EPA could classify greenhouse gases as pollutants. Jackson also said the agency's determination was preliminary and would not necessarily result in regulation.
The administration has said it prefers a new law that would limit greenhouse gases and put a price on climate-altering pollution.
"I have said over and over, as has the president, that we do understand that there are costs to the economy of addressing global warming emissions, and that the best way to address them is through a gradual move to a market-based program like cap and trade," Jackson said.
http://news.yahoo.com/s/ap/20090512/ap_on_go_ot/us_epa_climate;_ylt=An8wLzymjeAo_7oQ.eeSkOWyBhIF
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http://www.reason.com/news/show/133458.html
Obama and the Alternative Energy Fiasco
The president is wrong to block oil and gas production.
Jon Basil Utley | May 13, 2009
It's only a matter of time before President Barack Obama's vast popularity runs aground on his energy policies. In the name of saving the planet from global warming, he has delayed new oil drilling, an action that will have major political repercussions once the world economy recovers. Instead of using some the stimulus billions to produce more gas and oil, Obama's wild-eyed supporters dream of "renewable" energy derived from corn, wind, sunshine, and even grass.
With the appointment of extremists like climate czar Carol Browner and science adviser John Holdren, Obama has placed his administration's environmental policy in the hands of radicals. Interior Secretary Ken Salazar proposes replacing oil and coal with windmills. Yet Barron's recently reported that America would need to build 500,000 giant offshore windmills and transmission lines to produce Salazar's specified 1,900 gigawatts of electricity. In contrast, oil and gas drilling could provide hundreds of thousands of solid, well-paying blue-collar jobs. Washington Post economics columnist Robert Samuelson explains this in "The Bias Against Oil & Gas," describing how alternative energy job creation is miniscule compared to what an expansion of oil production would create. Meanwhile, Rep. Henry Waxman (D-Calif.) and Rep. Edward Markey (D-Mass.) have proposed legislation giving legal standing to allow Americans to sue any company that produces "greenhouse" gasses.
All of these things are happening at a time when natural gas is abundant and cheap. The new technology of horizontal fraccing has made it economically feasible to drill into vast shale deposits in many states, even famously difficult ones like Michigan and New York. Many cars could run on natural gas, much like many buses do already. On a recent trip to Peru, I learned that most taxicabs have been converted to natural gas for a cost of about $1,000 each. New technologies continually revive old oil and gas fields and make new ones economically viable. So it's little more than socialist Malthusianism to argue that the world is running out of cheap energy. Science will always find and harness new sources. Even the liberal New Republic recently admitted that, "Utopian environmentalism has, to some extent, always promised to heal the alienation wrought by modernity... it is a form of escapism and disengagement from reality." The extremists scoff at science and would apparently prefer scarcity so that bureaucratic rationing will enforce a change in American lifestyles.
Instead of producing more of the cheap, abundant energy that fueled America's dynamic growth, the extremists who support and surround Obama dream of drastically cutting American consumption. Many of them would like to see the government force General Motors to make flimsy little cars that run on electricity (or alternative energy) at the cost of billions. Meanwhile, the Sierra Club magazine recently boasted of helping to block construction of 96 coal-fired power plants and helping to impose a de facto moratorium on all new plants.
Currently, half of the drilling rigs in America are shutdown because of low oil and gas prices. Most smaller oil companies have suffered severe damage or even gone bankrupt by their inability to renew loans or gain credit. Likewise, the majors have few safe options in foreign countries but would invest heavily in offshore American exploration, if it were permitted.
So what about the so-called green alternatives? Forbes recently detailed the problems with windmills. First, they depend upon a two-cent-per-kilowatt taxpayer subsidy to remain competitive. They also require backup gas generators (in case the wind isn't blowing when needed) and new transmission lines running from windy places to population centers. And while new technologies to store wind-generated electricity are in the works, they have so far proven uneconomical. Nor does this even begin to consider the years of legal delays that would likely result from litigious neighbors opposed to new transmission towers. Solar power is even more expensive and would also require additional billions for backup generators and new transmission lines. Compare those unseen costs to the clear benefits of coal and gas plants where transmission lines are already built.
New oil and gas technologies could also help the U.S. from importing so much oil. But the Obama administration is stalling and trying to stop the offshore drilling approved by the previous Congress. The White House has also shut down previously permitted onshore drilling and burdened drillers with costly new restrictions. Meanwhile, $80 billion in stimulus spending has been earmarked for "renewable" energy. The plan is to give a 30 percent tax credit for the associated costs.
Americans will soon again feel the sting of gasoline costing $3.00 or $4.00 per gallon and then come to recognize how we've wasted years of opportunity to produce more energy domestically. For instance, the U.S. Geological Survey estimates that there are 85 billion barrels of offshore oil. (And that is an old number. It is almost certain to increase once new exploration and testing are permitted.) New supplies in continental America, not to mention the billions of barrels now accessible in Alaska, could transform our trade deficit by cutting hundreds of billions of dollars in imports. This would help rescue the value of the dollar, alleviate the cost of maintaining armies and navies in the Middle East, and help save free trade from the latest round of restrictions.
It's also essential to remember that so-called renewable energy cannot replace oil and natural gas in any significant way. For example, corn-based ethanol production "costs" nearly as much to produce as it saves in oil and can only exist with the help of costly and unending subsidies. Government, in other words, gets what it pays for. If it offers subsidies to alleviate global warming or make gasoline from grass, it will find promoters who will gladly accept that money and deliver scant results.
With the Republicans no longer handicapped by leaders like George W. Bush and John McCain, both of who caved before environmental extremists, Obama's energy policies might be a strong issue for conservatives and libertarians to rally around, and perhaps change their political fortunes. Remember that McCain famously opposed drilling in ANWR, while Bush promised the country that a gasoline substitute could be produced from switch grass.
One day the alternative energy fiasco will be studied as a vast example of waste and fraud that contributed to the collapse of the dollar and to lower living standards for most Americans. Let's hope that day comes sooner rather than later.
Jon Basil Utley is associate publisher of The American Conservative. He is a former insurance executive with AIG and a former South American correspondent for Knight Ridder.
Discuss this article online.
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GPS system 'close to breakdown'Network of satellites could begin to fail as early as 2010
http://www.guardian.co.uk/technology/2009/may/19/gps-close-to-breakdown
It has become one of the staples of modern, hi-tech life: using satellite navigation tools built into your car or mobile phone to find your way from A to B. But experts have warned that the system may be close to breakdown.
US government officials are concerned that the quality of the Global Positioning System (GPS) could begin to deteriorate as early as next year, resulting in regular blackouts and failures – or even dishing out inaccurate directions to millions of people worldwide.
The warning centres on the network of GPS satellites that constantly orbit the planet and beam signals back to the ground that help pinpoint your position on the Earth's surface.
The satellites are overseen by the US Air Force, which has maintained the GPS network since the early 1990s. According to a study by the US government accountability office (GAO), mismanagement and a lack of investment means that some of the crucial GPS satellites could begin to fail as early as next year.
"It is uncertain whether the Air Force will be able to acquire new satellites in time to maintain current GPS service without interruption," said the report, presented to Congress. "If not, some military operations and some civilian users could be adversely affected."
The report says that Air Force officials have failed to execute the necessary steps to keep the system running smoothly.
Although it is currently spending nearly $2bn (£1.3bn) to bring the 20-year-old system up to date, the GAO – which is the equivalent of Britain's National Audit Office – says that delays and overspending are putting the entire system in jeopardy.
"In recent years, the Air Force has struggled to successfully build GPS satellites within cost and schedule goals," said the report. "It encountered significant technical problems … [and] struggled with a different contractor."
The first replacement GPS satellite was due to launch at the beginning of 2007, but has been delayed several times and is now scheduled to go into orbit in November this year – almost three years late.
The impact on ordinary users could be significant, with millions of satnav users potential victims of bad directions or failed services. There would also be similar side effects on the military, which uses GPS for mapping, reconnaissance and for tracking hostile targets.
Some suggest that it could also have an impact on the proliferation of so-called location applications on mobile handsets – just as applications on the iPhone and other GPS-enabled smartphones are starting to get more popular.
Tom Coates, the head of Yahoo's Fire Eagle system – which lets users share their location data from their mobile – said he was sceptical that US officials would let the system fall into total disrepair because it was important to so many people and companies.
"I'd be surprised if anyone in the US government was actually OK with letting it fail – it's too useful," he told the Guardian.
"It sounds like something that could be very serious in a whole range of areas if it were to actually happen. It probably wouldn't damage many locative services applications now, but potentially it would retard their development and mainstreaming if it were to come to pass."
The failings of GPS could also play into the hands of other countries – including opening the door to Galileo, the European-funded attempt to rival America's satellite navigation system, which is scheduled to start rolling out later next year.
Russia, India and China have developed their own satellite navigation technologies that are currently being expanded.
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Ha! Great minds think alike , , , or something like that. I just posted the same piece on the SCH forum a couple of minutes ago :-)
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The Next Oil Shock
By INVESTOR'S BUSINESS DAILY | Posted Friday, May 22, 2009 4:20 PM PT
Energy Policy: A top expert tells Congress that oil will be around for a long time and high inventories and low prices are no excuse not to find more. Oil shock? How about a no-oil shock?
Read More: Energy
Be careful what you wish for, goes the old proverb. Well, as we all had hoped, energy prices have fallen — but only as part of the global decline in economic activity. This has been used as an excuse to further discourage exploration for and development of domestic oil resources. But if the economy does recover, that policy could provoke another recession.
Daniel Yergin, chairman of HIS-CERA, testified before the Joint Economic Committee of Congress last week that we have already experienced a "demand shock" with very high prices driven by rising global demand led by the economies of China and India.
We've also experienced what he calls a "recession shock" with flat or falling demand and low prices. But there might be another "long aftershock" in our future with high demand returning with a vengeance along with a global economic recovery, leaving those who buried their heads in the oil sands in the economic lurch.
The current recession has wiped out demand growth for the last four years. Oil prices have tumbled $100 a barrel or more from their high point. Spare production capacity is expected to be 6.5 million barrels per day through 2009. Anticipating a robust future, other countries such as China and Brazil have continued to look for oil while we continue to research . . . switch grass.
Interestingly, as Yergin notes, current spare capacity is equal to the combined total output of Iran and Venezuela — or the combined exports of Iran, Venezuela and Nigeria.
These are three of the most unstable nations on the earth, and two of them are implacably hostile to the U.S. This does not bode well for our economic and energy security.
While low prices and excess capacity sound good, they could vanish like the morning dew. The long lead times, up to a decade for a new field, needed to expand capacity and replenish supplies should compel us to drill like there's no tomorrow — for there might not be.
Oil will continue to be a big player in our energy mix no matter how many windmills we tilt at or how many clown cars we place in front of 18-wheelers on our interstates.
"Today," Yergin notes, "fossil fuels — oil, natural gas, and coal — supply over 80% of our total energy. Oil by itself is about 40%. That alone makes clear the importance of oil — and the evolution of the oil market — to our economy and security in the decade ahead."
America's oil and natural gas energy needs will grow. A study by ICF International, commissioned by the American Petroleum Institute, finds that our domestic energy resources placed off limits by Congress in ANWR, in Rocky Mountain shale and in the Outer Continental Shelf could generate more than $1.7 trillion in government revenue and create thousands of new jobs.
The irony is that in North America we have enough oil to ensure our energy and economic security. The U.S. and Canada together hold 15% of the world's proven reserves, and that's not even including the potential of American oil shale and Canadian oil sands — which are massive.
The current decline in demand has also sparked a decline in investment and added further justification for its deliberate policy of thwarting any expansion in domestic supply.
"As the economy picks up, spare capacity will start to erode, and the oil market could tighten again in the first half of the next decade," Yergin said. "The result could be another adverse shock to the U.S. economy and global energy security."
The result could be another recession where we drive to the unemployment office in our government-designed clown cars.
http://www.ibdeditorials.com/IBDArticles.aspx?id=327889262764776
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It's simple. The technology to provide us with a satisfactory alternative to fossil fuel (other than nuclear) hasn't been invented yet.
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Ethanol's Grocery Bill
Two federal studies add up the corn fuel's exorbitant cost.
The Obama Administration is pushing a big expansion in ethanol, including a mandate to increase the share of the corn-based fuel required in gasoline to 15% from 10%. Apparently no one in the Administration has read a pair of new studies, one from its own EPA, that expose ethanol as a bad deal for consumers with little environmental benefit.
The biofuels industry already receives a 45 cent tax credit for every gallon of ethanol produced, or about $3 billion a year. Meanwhile, import tariffs of 54 cents a gallon and an ad valorem tariff of four to seven cents a gallon keep out sugar-based ethanol from Brazil and the Caribbean. The federal 10% blending requirement insures a market for ethanol whether consumers want it or not -- a market Congress has mandated will double to 20.5 billion gallons in 2015.
The Congressional Budget Office reported last month that Americans pay another surcharge for ethanol in higher food prices. CBO estimates that from April 2007 to April 2008 "the increased use of ethanol accounted for about 10 percent to 15 percent of the rise in food prices." Ethanol raises food prices because millions of acres of farmland and three billion bushels of corn were diverted to ethanol from food production. Americans spend about $1.1 trillion a year on food, so in 2007 the ethanol subsidy cost families between $5.5 billion and $8.8 billion in higher grocery bills.
A second study -- by the Environmental Protection Agency's Office of Transportation and Air Quality -- explains that the reduction in CO2 emissions from burning ethanol are minimal and maybe negative. Making ethanol requires new land from clearing forest and grasslands that would otherwise sequester carbon emissions. "As with petroleum based fuels," the report concludes: "GHG [greenhouse gas] emissions are associated with the conversion and combustion of bio-fuels and every year they are produced GHG emissions could be released through time if new acres are needed to produce corn or other crops for biofuels."
The EPA study also explores a series of alternative scenarios over 30 to 100 years. In some cases ethanol leads to a net reduction in carbon relative to using gasoline. But many other long-term scenarios observe a net increase in CO2 relative to burning fossil fuels. Ethanol produced in a "basic natural gas fired dry mill" will over a 30-year horizon produce "a 5% increase in GHG emissions compared to petroleum gasoline." When ethanol is produced with coal burning mills, the process "significantly worsens the lifecycle GHG impact of ethanol" creating 34% more greenhouse gases than gasoline does over 30 years.
Both CBO and EPA find that in theory cellulosic ethanol -- from wood chips, grasses and biowaste -- would reduce carbon emissions. However, as CBO emphasizes, "current technologies for producing cellulosic ethanol are not commercially viable." The ethanol lobby is attempting a giant bait-and-switch: Keep claiming that cellulosic ethanol is just around the corner, even as it knows the only current technology to meet federal mandates is corn ethanol (or sugar, if it didn't face an import tariff).
As public policy, ethanol is like the joke about the baseball prospect who is a poor hitter but a bad fielder. It doesn't reduce CO2 but it does cost more. Imagine how many subsidies the Beltway would throw at ethanol if the fuel actually had any benefits.
http://online.wsj.com/article/SB124389966385274413.html
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I've heard it said that the reason the tax code is so complicated is so that lawmakers can bury favors deep in its bowels with impunity. Starting to look like cap and trade will go a similar route.
Energy Price Deceit
Congress tries to hide its cap-and-trade energy price increases
Ronald Bailey | June 2, 2009
Last month, leading Congressional climateer, Rep. Henry Waxman (D-Calif.), chair of the House Energy and Commerce Committee, pushed out a sweeping 1000-page bill that aims to dramatically reshape how Americans will use energy in the 21st century. At the heart of the American Clean Technology and Security (ACES) Act is a cap-and-trade proposal for limiting the emissions of carbon dioxide by American industry and consumers. Carbon dioxide, produced by burning fossil fuels and chopping down forests, is building up in the atmosphere where it is thought be the chief cause of man-made global warming.
The ACES Act would establish an artificial carbon market by setting a limit on the amount of greenhouse gases that can be emitted each year. Beginning in 2012, a national cap—or total maximum CO2 emissions—would be set and then ratcheted downward annually. Under ACES, the U.S. would emit 17 percent less carbon dioxide in 2020 than it did in 2005, eventually falling to 83 percent less than emitted in 2005 by 2050.
Electric and gas utilities, cement plants, steel foundries, and other companies would be required to have one emissions permit for every ton of CO2 discharged from their smoke stacks. Under a cap-and-trade scheme, emissions permits can be allocated and/or auctioned up to the set cap. Once allocated, the market allows companies emitting less than their quota to sell their excess permits to emitters needing to buy extra to meet their cap. This process sets a price on each ton of carbon dioxide.
The central fact of the cap-and-trade proposal is that it will increase the price of energy. If energy prices don't go up, the goal of getting energy producers, manufacturers, and consumers to shift away from carbon generating fuels (coal, oil, and natural gas) toward low-carbon sources of energy (nuclear, solar, wind, conservation) will not be achieved.
Whatever else they are, the folks in Congress are not stupid when comes to protecting their electoral viability. They are painfully aware of the fact that, while Americans express support for regulations to reduce greenhouse gases, 77 percent in a recent ABC News/Washington Post poll declared themselves either "very concerned" or "concerned" that "federal regulation of greenhouse gases could substantially raise the price of things you have to pay for."
So in an attempt to ward off voter displeasure over higher energy prices brought about by Congressionally-mandated carbon rationing, the denizens on Capitol Hill have tacked on a number of Rube Goldbergesque policy obfuscations designed the mask the price increases. These include subsidies and tax breaks for retrofitting buildings to use less energy, setting energy conservation appliance standards, subsidies for higher mileage automobiles, and imposing a renewable fuel standard on utility companies, among many other things.
The chief technique that Congress is using to hide the mandated price increase in electricity and natural gas from voters is giving away free emissions permits to local electricity and gas distribution companies. In the ACES bill, some 30 percent of emissions permits are allocated free to local distribution companies who are supposed to sell the permits and then pass along the money to consumers as a lump sum rebate to offset their higher utility bills. Why a lump sum?
As Harvard University environmental economist Robert Stavins explains in his article on "The Wonderful Politics of Cap-and-Trade," the hope is that such rebates will compensate "consumers for increases in electricity prices, but without reducing incentives for energy conservation." Even if they are getting a rebate, higher monthly electric bills will still likely annoy voters. But let's assume that this scheme actually works as intended and blunts household displeasure about paying more for electricity and natural gas.
There's one big problem: The proposal merely shifts the price paid by consumers for energy from local utilities to other products and services. For example, Resources for the Future economists Rich Sweeney and Dallas Burtraw calculate that auctioning all of the carbon emissions permits would result in a price of $20.91 per metric ton. However, allocating 30 percent of the carbon dioxide emissions permits free to local utilities as proposed under the ACES bill would mean lower electricity prices, and lower prices would mean more consumption. The result is that there would 24 percent fewer emissions reductions in the electricity sector than would have been the case had all permits been auctioned.
The higher emissions in the electricity sector make it harder for other sectors of the economy—automobiles, construction, steel, cement, food processing, retail, agriculture—to stay below the national cap on carbon dioxide emissions. And this pushes up the demand for the remaining permits, which boosts their prices. Sweeney and Burtraw calculate that the requirement for increased emissions reductions in other sectors under a national cap would raise the allowance price to $26.90 per metric ton. The result, according to Sweeney and Burtraw, is that "this raises the costs of goods and services from these sectors."
So this plan to allocate "free" permits could well end up costing consumers even more than they "save" on their household electricity and natural gas bills. Fearing the electoral consequences of honesty, Congress is trying to hide the fact that they are increasing energy prices by distracting the American people with a torrent of rebates, subsidies, and tax incentives, along with plenty of happy talk about renewable energy and creating "green jobs." The result is that Congress has devised a complicated and inefficient scheme where distributing a "free" commodity actually makes products and services more expensive than it would otherwise have to be. That's truly "wonderful politics"!
Ronald Bailey is Reason magazine's science correspondent. His book Liberation Biology: The Scientific and Moral Case for the Biotech Revolution is now available from Prometheus Books.
http://www.reason.com/news/printer/133893.html
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OOPS!!!! Did I do that. :-o
Gov't posts sensitive list of US nuclear sites
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Delicious Digg Facebook Fark Newsvine Reddit StumbleUpon Technorati Yahoo! Bookmarks Print Featured Topics: Barack Obama By H. JOSEF HEBERT, Associated Press Writer H. Josef Hebert, Associated Press Writer – 20 mins ago
WASHINGTON – The head of the agency responsible for the country's nuclear weapons says a list of nuclear sites accidentally made public does not include classified information about weapons-related facilities.
Thomas D'Agostino head of the National Nuclear Security Administration, told a Senate hearing Wednesday the sites on the list are of civilian facilities and that none of the information is classified. Still, he said he's concerned the list could provide an "easy locator" for uranium storage sites and other facilities related to the country's civilian nuclear program.
The 266-page document was accidentally put on the Government Printing Office Web site. It is information that is to be provided as part of an international nuclear inspection program.
THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP's earlier story is below.
WASHINGTON (AP) — The government accidentally posted on the Internet a list of government and civilian nuclear facilities and their activities in the United States, but U.S. officials said Wednesday the posting included no information that compromised national security.
However, Energy Secretary Steven Chu, questioned about the disclosure at a House hearing, expressed concern with respect to a uranium storage facility at the department's Y-12 facility in Oak Ridge, Tenn. The facility holds large quantities of highly enriched uranium, which if obtained can be used to fashion a nuclear weapon.
"That's of great concern," said Chu, referring to the Y-12 site. "We will be looking hard and making sure physical security of those sites (at Y-12) is sufficient to prevent eco-terrorists and others getting hold of that material."
But later Chu told reporters that while the disclosure may be embarrassing "there's no secret classified information that's been compromised (and) the sites and everything are public knowledge" already available elsewhere.
But, he added, the list "gathers it up" in a single document, and that is of some concern.
The 266-page document was published on May 6 as a transmission from President Barack Obama to Congress. According to the document, the list was required by law and will be provided to the International Atomic Energy Agency.
Some of the pages are marked "highly confidential safeguards sensitive."
Chu said he had no details as to how the document was released, beyond that it involved the government printing office. "Someone made a mistake," said Chu, appearing before a House Appropriations subcommittee .
Damien LaVera, a spokesman for the National Nuclear Security Administration, said the document had been reviewed by a number of U.S. agencies and that disclosure of the information did not jeopardize national security. He said the document is part of an agreement on nuclear material inspection under the IAEA's nuclear nonproliferation effort.
"While we would have preferred it not be released, the Departments of Energy, Defense, and Commerce and the NRC all thoroughly reviewed it to ensure that no information of direct national security significance would be compromised," LaVera said in a statement.
An Energy Department official, who spoke on condition of anonymity because the official was not authorized to discuss the situation publicly, said none of the sites on the list are directly part of the government's nuclear weapons infrastructure.
In addition tothe Y-12 facility, the document includes some facilities at the Energy Department's Hanford nuclear site in Washington state and various civilian nuclear fuel processing sites including uranium enrichment facilitates, according to government officials.
Uranium stored at the Y-12 site is scheduled to be moved into a new $549 million high-security warehouse in 2010, said Y-12 spokesman Steve Wyatt. The 300-by-475-foot, fortress-like warehouse, under construction since 2004, will replace several aging vault-like storage facilities.
Beth Hayden, a spokeswoman for the Nuclear Regulatory Commission, said the agency reviewed the document as it relates to civilian facilities with NRC licenses and "we are confident that information of direct national security significance was not compromised."
The NRC has jurisdiction over commercial nuclear power plants and civilian uranium processing and storage facilities.
The publication of the list was first reported in an online secrecy newsletter Monday. The document had been posted on the Government Printing Office Web site, but has since been removed from that site.
In a statement, the Government Printing Office said Wednesday: "Upon being informed about potential sensitive nature of the attachment in this document, the Public Printer of the United States removed it from GPO's Web site pending further review. After consulting with the White House and Congress, it was determined that the document, including sensitive attachment, should be permanently removed from the Web site."
The GPO said it processes and produces approximately 160 House documents during the two-year congressional cycle, and the list was received by the agency in the normal process and produced under routine operating procedures.
The document includes both government and civilian nuclear facilities, all of which have various levels of security, including details and location of nation's 103 commercial nuclear power reactors, information readily available from various sources.
The document details the location of the nuclear sites and what is being done there.
For instance, there are nuclear reactors at the Westinghouse Electric Company in Pittsburgh, Pa. This facility is currently working on research into what happens when there are accidents with the nuclear reactors. The project started in 2006 and is expected to end in 2012, according to the document.
BOYO
PS these guys want to run healthcare and keep our records private Yeah right
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Al Gore Rules :wink:
Al Gore invests millions to make billions in cap-and-trade software
June 2, 2009
Al Gore’s venture capital firm has invested $6 million in a software company that stands to make billions of dollars from cap-and-trade regulation — further fueling controversy that Gore lied about his profiteering from cap-and-trade to Rep. Marsha Blackburn (R-TN) and the House Energy and Environment Subcommittee during testimony in April.
Hara Software sells software to help track greenhouse gas emissions. The market for such software is now about $2.5 billion dollars in size, and is expected to grow by a factor of ten to $25 billion if cap-and-trade legislation is enacted, according to Hara CEO Amit Chatterjee.
Kleiner Perkins, a venture capital firm in which Al Gore is a partner, invested in Hara just last year. Chatterjee told Reuters that,
“This company would not have existed if Al Gore had not bought off on the idea.”
Gore is also under fire for lying to Rep. Steve Scalise (R-LA) at the same congressional hearing about his relationship with Goldman Sachs.
Operating as a stealth tax, cap-and-trade will make the vast majority of Americans poorer and less free — but Al Gore, Kleiner Perkins, Amit Chatterjee and Hara will be laughing all the way to the bank.
Boyo.
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Which Is Greener?
Posted by Randal O'Toole
Which uses less energy and emits less pollution: a train, a bus, or a car? Advocates of rail transportation rely on the public’s willingness to take for granted the assumption that trains — whether light rail, subways, or high-speed intercity rail — are the most energy-efficient and cleanest forms of transportation. But there is plenty of evidence that this is far from true.
Rail advocates often reason like this: the average car has 1.1 people in it. Compare the BTUs or carbon emissions per passenger mile with those from a full train, and the train wins hands down.
The problem with such hypothetical examples is that the numbers are always wrong. As a recent study from the University of California (Davis) notes, the load factors are critical.
The average commuter car has 1.1 people, but even during rush hour most of the vehicles on the road are not transporting commuters. When counting all trips, the average is 1.6, and a little higher (1.7) for light trucks (pick ups, full-sized vans, and SUVs).
On the other hand, the trains are rarely full, yet they operate all day long (while your car runs only when it has someone in it who wants to go somewhere). According to the National Transit Database, in 2007 the average American subway car had 25 people in it (against a theoretical capacity of 150); the average light-rail car had 24 people (capacity 170); the average commuter-rail car had 37 people (capacity 165); and the average bus had 11 (capacity 64). In other words, our transit systems operate at about one-sixth of capacity. Even an SUV averaging 1.7 people does better than that.
When Amtrak compares its fuel economy with automobiles (see p. 19), it relies on Department of Energy data that presumes 1.6 people per car (see tables 2.13 for cars and 2.14 for Amtrak). But another Department of Energy report points out that cars in intercity travel tend to be more fully loaded — the average turns out to be 2.4 people.
“Intercity auto trips tend to [have] higher-than-average vehicle occupancy rates,” says the DOE. “On average, they are as energy-efficient as rail intercity trips.” Moreover, the report adds, “if passenger rail competes for modal share by moving to high speed service, its energy efficiency should be reduced somewhat — making overall energy savings even more problematic.”
Projections that high-speed rail will be energy-efficient assume high load factors (in the linked case, 70 percent). But with some of the routes in the Obama high-speed rail plan terminating in such relatively small cities as Eugene, Oregon; Mobile, Alabama; and Portland, Maine, load factors will often be much lower.
Even if a particular rail proposal did save a little energy in year-to-year operations, studies show that the energy cost of constructing rail lines dwarfs any annual savings. The environmental impact statement for a Portland, Oregon light-rail line found it would take 171 years of annual energy savings to repay the energy cost of construction (they built it anyway).
Public transit buses tend to be some the least energy-efficient vehicles around because agencies tend to buy really big buses (why not? The feds pay for them), and they run around empty much of the time. But private intercity buses are some of the most energy efficient vehicles because the private operators have an incentive to fill them up. A study commissioned by the American Bus Association found that intercity buses use little more than a third as much energy per passenger mile as Amtrak. (The source may seem self-serving, but DOE data estimate intercity buses are even more efficient than that–compare table 2.12 with intercity bus passenger miles in this table).
When it comes to energy consumption per passenger mile, the real waste is generated by public transit agencies and Amtrak. Instead of trying to fill seats, they are politically driven to provide service to all taxpayers, regardless of population density or demand. One of Amtrak’s unheralded high-speed (110-mph) rail lines is between Chicago and Detroit, but it carries so few people that Amtrak loses $84 per passenger (compared with an average of $37 for other short-distance corridors).
Meanwhile, transit agencies build light-rail lines to wealthy suburbs with three cars in every garage. With capacities of more than 170, the average light-rail car in Baltimore and Denver carries less than 15 people, while San Jose’s carries 16. For that we need to spend $40 million a mile on track and $3 million per railcar (vs. $300,000 for a bus)?
If we really wanted to save energy, we would privatize transit, privatize Amtrak, and sell highways to private entrepreneurs who would have an incentive to reduce the congestion that wastes nearly 3 billion gallons of fuel each year (p. 1). But of course, the real goal of the rail people is not to save energy but to reshape American lifestyles. They just can’t stand to see people enjoying the freedom of being able to go where they want, when they want to get there.
http://www.cato-at-liberty.org/2009/06/08/which-is-greener/
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Body by Guinness; let's try again, somehow we got off (and stayed off) on the wrong foot.
I am not looking to argue, just seeking your opinion.
Trains/Rail transit.
I am not arguing with the issue of fuel efficiency; I understand your point about "empty" trains.
And I am not defending boondoggles; for example they are proposing a high speed train from LA to Vegas,
but I don't gamble much, so I don't care.
But... I do find trains rather efficient. Privatize them, fine; maybe they will run on time. Raise the price; fine, but...
As I travel in America to SF, NY, or Chicago, I find rails a pleasant way to go. And as I travel to
London, Paris or Tokyo I keep thinking I wish we had a vast rail rail system here in LA.
As population grows, density grows, therefore don't you think rail and bus to be efficient? I know people in LA who
spend and hour commute+ each way by car. And we can widen the freeways only so much and build only
so many new roads. Rather inefficient I would say, not to mention wasted time and
energy. And intangible costs include accidents, etc.
What are your thoughts? Why oppose new rail lines?
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Before BBG gets to this, if I may respond as an Angeleno who was born and raised in NYC?
Los Angeles is a reallly, really spread out area. To use a train of some sort means having to get to the train station and having to do something to get to one's actual destination after getting off the train at the other end. Bottom line, the trains lose money. LOTS of money. Rail does not make sense-- but it does cost billions and billions of dollars, not that we have gotten around yet to paying for it , , ,
Not speaking from specific knowledge, but my sense of things is that the city's bus system is an economic clusterfcuk. Yet for some strange reason (e.g. public union objections :x ) the city vociferously opposes jitneys.
Even in the Boston-NY-Philadelphia-DC corredor, AMTRAK is a multi-billion dollar annual drain on the public coffers , , , what a bargain price for having gotten Joe Biden from home to the Senate all these years , , ,
DC's metro train system was built with the taxes of the nation. Why?
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I understand your point.
And yes, LA is spread out, but for example my brother lives in Canyon Country (an hour drive) and his wife is a VP at a bank downtown; she takes the Metro Link and loves it.
And yes, the bus system is a clusterfuk. I've tried it a few times; I don't think they know what "on time" means. IF they even show up.
But it does work in other cities. SF for example has BART; people seem to like it. As for NY a friend I stayed with lives in CN and takes the train
everyday in to Manhattan. He too loves it. But I also agree AMTRAK seems like a clusterfuk. But as to why, I don't know. In theory it seems to me it
should have potential. And if you have visited Japan, well, the train and bus system is fabulous. One time the bus driver actually apologized to everyone on
board for being 5 minutes late. :? I wish that was the issue in LA.
And you know LA; we can't just keep adding people and cars; every year traffic has gotten worse and worse. Something ? needs to be done...
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Body by Guinness; let's try again, somehow we got off (and stayed off) on the wrong foot.
Wrong foot had little to do with it. Circular arguments did.
I use to teach a Thai Boxing class on a college campus. We'd get a lot of traditional martial artists showing up to check us out, and ran an open mat after class, so I'd get to spar with these guys, guys who wanted to show us upstarts up. Traditional guys' technique tends to have more snap that power, are rarely tested against the real world, and have an ingrained point scoring ethic that skews its application and so on. I'm an old, fat guy, but without exception I'd drop these college kids to the mat.
Interesting conversations would ensue. In Thai Boxing you seek to conserve energy, so a parry that causes a blow to brush past your face was considered a good parry. Some guy I had smacked down would say "I hit you as often as you hit me." Well yes, except I parried effectively, and he didn't so he got his a$$ sat down. Alas touching someone's head was a counted in his point scoring art so he'd pretend some sort of victory. Or I'd block some high, snappy kick and then take out the down leg, only to be informed it was against the rules to do so. Not in Thai Boxing, I'd reply.
Bottom line is I'd get to have a lot of circular discussion with folks who would equivocate about the blows they landed and make inane arguments about why this or that should be disallowed. But hey, I'd get to work on my game, had the satisfaction of watching them form their arguments with bloody lips, and wouldn't have to do a second lap around the same track with them as one beat down was enough and they wouldn't show up again for a second try.
Needless to say I see a lot of parallels where our exchanges are concerned, save for the fact that sparring with you doesn't improve my game, I see little evidence that the blows I land changes yours, and no matter how many times your a$$ is owned you're back at it using the same techniques the next day. Bottom line: I derive no benefit from sparring with you, so it's pretty stupid to continue doing so, yes?
I am not arguing with the issue of fuel efficiency; I understand your point about "empty" trains.
And I am not defending boondoggles; for example they are proposing a high speed train from LA to Vegas,
but I don't gamble much, so I don't care.
Wrong pronoun, it's not my argument, it's the authors. I like to post heterodox pieces that challenge conventional wisdom and certainly haven't researched the issue to the point I feel qualified to pretend expertise.
But... I do find trains rather efficient. Privatize them, fine; maybe they will run on time. Raise the price; fine, but...
As I travel in America to SF, NY, or Chicago, I find rails a pleasant way to go. And as I travel to
London, Paris or Tokyo I keep thinking I wish we had a vast rail rail system here in LA.
Anecdote isn't an argument. The author lists specific reasons why efficiency figures are not to be believed. If we are to make cogent arguments as to why we should have a rail system as cosmopolitan as you cite, then good numbers would seem a prerequisite. Please note here that you veer away from the point of the piece, and slip in an urbane bon mot, habits that consistently emerge in other exchanges and that have little to do with framing a cogent response.
As population grows, density grows, therefore don't you think rail and bus to be efficient? I know people in LA who
spend and hour commute+ each way by car. And we can widen the freeways only so much and build only
so many new roads. Rather inefficient I would say, not to mention wasted time and
energy. And intangible costs include accidents, etc.
Again the piece is about how the current debate is based on fallacious numbers, the sort of fallacious numbers people who feel they should be able to tell others how to live then use to limit choices and force policy change congruent to their political ends. If an argument is a good one, why do bad figures have to be bandied to make the sale?
What are your thoughts? Why oppose new rail lines?
I don't oppose them, though I do oppose public monies being spent on dubious projects based on faulty numbers. Is one allowed to favor solutions based on the empiric rather than the political? Or is framing a sunny ideal and then daring someone to take issue with it all that's required?
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I too derive no benefit from sparring with you; as you said, you are "an old, fat guy.".
But maybe the students on your campus felt the same way? We both have tried to be polite and respectful to you, but
to no avail. And you are right, "the blows you land" have little affect. So why do you insist upon continuing to spar?
In contrast, in the spirit of conciliation and rapprochement, I tried appeasement and a little humor in my opening sentence.
I agree it is "pretty stupid to continue" sparing with you; rather I would simply prefer that you stay at the lectern and
offer your thoughts on the subject without a direct and personal repoiste. I think most on this forum would agree.
Yet, after all this time, and reprimands, you still seem to find that difficult to do? Here you provided a lengthy personal response that primarily addresses me
rather than the thought on the table. Why? Oh never mind. But perhaps it might be better to address the issues rather than attack the messenger?
And I admit I mistook your posting as your personal position or at minimum, one of interest to you; not simply a "challenge to conventional wisdom";
that is why I "veered away from the point of the piece" and asked your thoughts. You do seem like a bright fellow, so I hoped you would address the big picture
(public transportation) beyond the confines of this narrow piece on why efficiency figures are not to be believed.
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Sure thing, JDN, and my mom wears combat boots, too.
And who's this "we" you're referring to? Have a mouse in your pocket or is this another royal "we" where you try to claim some sort of tangential authority by dropping an irrelevant tale about some mover and shaker you shared a salad fork with? Indeed, that's one of the three rhetorical devices you seem to have a handle on: the inanity hammer, where you keep recapitulating a point already well disputed as though reiteration somehow trumps all. Then there's facile deconstruction, where you cast someone you're arguing with as a caricature, usually a conservative Republican, and then find some element of that doctrine that is not congruent, as you see it, with the matter at hand. And then there are the imperious associations already mentioned where you insert your self importance as as though it was an argument unto itself.
So you present a "rapprochement" as you embrace the same tools and think I should be gracious about the repackaging effort. Sheesh, what self delusion. I very much doubt you are aware of the water in which you swim and expect if an epiphany ever occurred you'd find yourself drowning amid your own synapses. You might want to reflect on how to allow people you engage to have choices other than smiling and nodding at your damn foolishness or escalating things until scathing rebukes are all that's left.
Be that as it may, I'll post what I want, when I want, and engage who I want regardless of any sputtering you do. For the record, the folks who left the Thai Boxing class weren't my students, but rather folks who thought they were going to school me. My students stayed and became better martial artists. The folks who left did so with their self delusions intact and perhaps became better within their traditional structure, but certainly did no growing outside that comfort zone. There are lessons to draw there. You are incapable of doing so.
I'll leave you with a little sketch that comes to mind when one of your circlar loops becomes particularly protracted.
[youtube]http://www.youtube.com/watch?v=zKhEw7nD9C4[/youtube]
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Climate change vote: Pelosi’s green gamble
By Jared Allen and Molly K. Hooper
Posted: 06/23/09 08:35 PM [ET]
Speaker Nancy Pelosi (D-Calif.) is moving forward with a floor vote on climate change legislation this week even though many Democrats are undecided on the controversial bill.
Pelosi’s gamble to schedule a Friday vote is one of the riskiest moves she has made as Speaker. There are at least eight Democrats who are firm “no” votes, while many others are on the fence (see chart page 14).
In an indication that Democrats lack the necessary votes to pass it on their side of the aisle, Pelosi and other party leaders have met with centrist Republicans seeking their support.
Pelosi and Majority Leader Steny Hoyer (D-Md.) — in coordination with the White House — decided on Monday night to file the bill with the Rules Committee. That surprise move has set up a vote-counting showdown by the end of the week.
Democratic aides said leaders had been building up to this decision as they monitored negotiations between Energy and Commerce Committee Chairman Henry Waxman (D-Calif.) and House Agriculture Committee Chairman Collin Peterson (D-Minn.) over the weekend.
At press time, Waxman and Peterson emerged from a meeting with the Blue Dog Coalition and announced that they reached an agreement.
“We have something that I think works for agriculture,” Peterson said.
The crux of the deal is a concession from Waxman to allow the Department of Agriculture — not the Environmental Protection Agency — to develop and monitor offset and land use provisions the legislation creates.
Waxman said he would not only retain the votes of the environmentalists, but also gain votes from those who represent the agriculture community.
“I think we will have the majority necessary to pass the bill,” Waxman said.
The Energy and Commerce Committee chairman said he would still be speaking to members of the Democratic Caucus to convince wary Democrats to vote yes.
“I’m going to continue to talk to members who’ve heard negative things about this bill from groups who are now going to support the bill,” he said.
Hoyer on Tuesday morning said, “If we didn’t have agreement and we didn’t have the votes, then we probably wouldn’t go forward.”
On the other side of the Capitol, Senate Majority Leader Harry Reid (D-Nev.) is taking steps to avoid friction from senators from farm states on climate change (see related story).
The climate change battle in the House is unique because Pelosi usually has to lean on liberals or centrist Democrats to get the votes she needs on hard-to-pass legislation. But the cap-and-trade measure has attracted skepticism from both factions.
Reps. Lacy Clay (D-Mo.) and Eddie Bernice Johnson (D-Texas), who are members of the Congressional Black Caucus (CBC), say they are not yet sold on the bill.
A vote-counter for the CBC, Rep. G.K. Butterfield (D-N.C.) explains that his colleagues are “reluctant to give a firm commitment until they can be satisfied that it will not disproportionately affect minority families.”
“It’s hard … in these economic times for us to say, ‘Bite the bullet’ and have higher utility bills in the winter and the summer,” Clay told The Hill.
Butterfield is calling on President Obama to become move involved.
“Now it’s time for the president to become more vocal, because he has a tremendous gift of communication and he needs to communicate with the American people,” Butterfield said.
Expected “no” votes from Democrats include Reps. Jason Altmire (Pa.), John Barrow (Ga.), Bobby Bright (Ala.), Artur Davis (Ala.), Jim Matheson (Utah), Charlie Melancon (La.), Mike Ross (Ark.) and Gene Taylor (Miss.).
Democrats who are undecided or on the fence include Reps. Neil Abercrombie (Hawaii), Henry Cuellar (Texas), Travis Childers (Miss.), Walt Minnick (Idaho) and Tom Perriello (Va.).
Rep. Paul Hodes (D-N.H.), who is running for the Senate, backs the House bill while Rep. Carol Shea-Porter (D-N.H.), who is being targeted by Republicans, also supports it.
Republicans are anxious for the battle on the floor. The National Republican Congressional Committee sent out a fundraising letter on Tuesday stating, “Cap-and-trade is nothing more than a tax which starts accruing the moment you flip on your light switch. This ‘light switch tax’ will raise energy costs by hundreds of dollars for the average family and between 1.8 and 7 million American jobs could be lost.”
Most Republicans will reject the climate bill. Rep. Mary Bono Mack (Calif.) was the only GOP member on the Energy and Commerce Committee to back it.
Reps. Mike Castle (R-Del.) and Vernon Ehlers (R-Mich.) are undecided on the measure.
The League of Conservation Voters, an environmental group that is an active player in political campaigns, stated on Tuesday that it would not endorse any member of the House who opposed the climate bill.
Michael M. Gleeson and Jim Snyder contributed to this article.
http://thehill.com/leading-the-news/pelosis-green-gamble-2009-06-23.html
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Here is some more on the Waxman debacle bill.
Waxman-Markey: Corruption In, Corruption Out
June 23, 2009
It’s hard to say whether the Waxman-Markey global warming bill that will soon be debated and voted on in the House is the most intellectually- and morally-corrupt bill ever seriously considered by Congress. But I’d bet that there are 433 congressmen who are glad that this legislative atrocity is not named after them.
After years of fierce battling by greens and global warming skeptics, few Americans seem to buy into the bill’s premise — that manmade emissions of carbon dioxide are causing the planet to run a fever, as Al Gore is fond of saying. Just this week, a public relations firm advising House Democrats recommended that the notion of “global warming” be dropped as a primary message since “almost no one in our focus groups expressed such concern.”
So despite all the frantic global warming alarmism — and the vicious likening of skeptics to Holocaust-deniers by Gore and the legions of green fanatics in activist groups, the media, industry and government — the out-manned and out-gunned skeptics have largely succeeded in being heard by Americans.
Ironically, the wild claims of Gore and the greens may have actually damaged the “green” brand. The PR firm also advised dropping the term “green” since it has become “meaningless or confusing” in focus group-testing.
Though stripped of its intellectual pretense, Waxman-Markey nevertheless soldiers on to House debate and vote. How this has come to pass must be one of the great tragicomedies of American political history.
To compel Congress and industry to work together toward the Waxman-Markey cap-and-trade regime, President Obama threatened both with EPA regulation of carbon dioxide, a move that would prevent Congress from reaping the political benefits of doling out $9 trillion worth of taxpayer funds to certain industries and special interest groups between 2012 and 2050. President Obama moved a step toward making good on this threat by ordering the EPA to declare carbon dioxide — what humans exhale and what plants need to grow — a threat to the public welfare.
Apparently even President Obama’s staff was somewhat embarrassed about that move. Obama climate czar Carol Browner ordered a “vow of silence” and issued an edict to “put nothing in writing ever” concerning White House staff deliberations on the matter.
When House Republicans Darrell Issa and James Sensenbrenner called for an investigation into Browner’s potentially “deliberate and willful violation” of the Presidential Records Act, Rep. Henry Waxman got Issa and Sensenbrenner to drop the subject with vague promises to “monitor the situation” and to “potentially” hold a hearing. None of Waxman supposed promises will be implemented before the House debate and vote on Waxman-Markey.
Competing for most-appalling character in the Waxman-Markey saga is Rep. Ed Markey. Immediately after the head of Warren Buffet’s electric utility unit testified against Waxman-Markey’s cap-and-trade provision, Markey fired off a letter to the Federal Energy Regulatory Commission (FERC) specifically requesting that Buffet’s utility be investigated. After being rebuked by House Republicans for this blatant intimidation, Markey then asked FERC to expand the requested investigation to all investor-owned utilities, rather than appearing to single out Buffet’s. Now all utilities are under operating with a Markey-pointed gun to their heads.
Although many businesses have been coerced into supporting Waxman-Markey, much of big business has actively pushed for the bill. Many Wall Street banks hope to profit from the trading of the $9 trillion in emissions allowances to be created under Waxman-Markey. Goldman Sachs would be the preeminent global warming bookie as it owns the exchanges where carbon allowances would be traded.
General Electric, whose CEO sits on Barack Obama’s Economic Recovery Advisory Board, was instrumental in putting together the U.S. Climate Action Partnership (USCAP), a bizarre big business-environmental activist group lobbying consortium that is a primary driver of global warming legislation. USCAP has even taken credit for drafting parts of Waxman-Markey. GE, it seems, would like a federal law requiring electric utilities buy the wind turbines and other energy technologies manufactured by — guess who — GE.
Republican James Sensenbrenner recently asked the Department of Justice to investigate USCAP members General Motors and Chrysler for illegally using taxpayer bailout money to lobby for global warming legislation. AIG, the insurance giant that is now a ward of U.S. taxpayers, only dropped out of USCAP after Rep. Joe Barton pointed out the illegality of accepting federal money and then using it to lobby the federal government.
And then there’s Al Gore, who stands to become the first “carbon billionaire” through his partnership in the venture capital firm of Kleiner Perkins Caufield and Byers and the UK-based investment firm of Generation Investment Management. When Gore testified in favor of global warming legislation before the Senate Foreign Relations Committee in January, he failed to disclose his personal financial interests and no Senator came close to asking him about them.
When he testified in April before the House Energy and Environment Subcommittee in favor of Waxman-Markey, Gore again failed to disclose his conflicts-of-interest. When Reps. Marsha Blackburn (R-TN) and Steve Scalise (R-LA) probed into these matters, Gore feigned ignorance and pretended that he would not personally benefit from Waxman-Markey. Although Rep. Waxman made baseball players testify under oath to Congress about the comparatively petty issue of drug use in baseball, he did not subject Gore to penalty for perjury.
In addition to Waxman-Markey’s $9 trillion wealth transfer from taxpayers to special interest groups, the Brookings Institution also estimates that Americans will lose $2 trillion (present value) in purchasing power between 2010-2050. Al Gore dubiously counters that the per household cost of Waxman-Markey is about the value of a postage stamp per day.
But even that’s too much for a bill that will accomplish nothing for the environment while simultaneously making a mockery of our system of government.
Steven Milloy publishes JunkScience.com and is the author of the Amazon.com bestseller, Green Hell: How Environmentalists Plan to Control your Life and What You Can Do to Stop
Enjoy Boyo
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Tilting at Green Windmills
By George F. Will
Thursday, June 25, 2009
The Spanish professor is puzzled. Why, Gabriel Calzada wonders, is the U.S. president recommending that America emulate the Spanish model for creating "green jobs" in "alternative energy" even though Spain's unemployment rate is 18.1 percent -- more than double the European Union average -- partly because of spending on such jobs?
Calzada, 36, an economics professor at Universidad Rey Juan Carlos, has produced a report that, if true, is inconvenient for the Obama administration's green agenda, and for some budget assumptions that are dependent upon it.
Calzada says Spain's torrential spending -- no other nation has so aggressively supported production of electricity from renewable sources -- on wind farms and other forms of alternative energy has indeed created jobs. But Calzada's report concludes that they often are temporary and have received $752,000 to $800,000 each in subsidies -- wind industry jobs cost even more, $1.4 million each. And each new job entails the loss of 2.2 other jobs that are either lost or not created in other industries because of the political allocation -- sub-optimum in terms of economic efficiency -- of capital. (European media regularly report "eco-corruption" leaving a "footprint of sleaze" -- gaming the subsidy systems, profiteering from land sales for wind farms, etc.) Calzada says the creation of jobs in alternative energy has subtracted about 110,000 jobs elsewhere in Spain's economy.
The president's press secretary, Robert Gibbs, was asked about the report's contention that the political diversion of capital into green jobs has cost Spain jobs. The White House transcript contained this exchange:
Gibbs: "It seems weird that we're importing wind turbine parts from Spain in order to build -- to meet renewable energy demand here if that were even remotely the case."
Questioner: "Is that a suggestion that his study is simply flat wrong?"
Gibbs: "I haven't read the study, but I think, yes."
Questioner: "Well, then. [Laughter.]"
Actually, what is weird is this idea: A sobering report about Spain's experience must be false because otherwise the behavior of some American importers, seeking to cash in on the U.S. government's promotion of wind power, might be participating in an economically unproductive project.
It is true that Calzada has come to conclusions that he, as a libertarian, finds ideologically congenial. And his study was supported by a like-minded U.S. think tank (the Institute for Energy Research, for which this columnist has given a paid speech). Still, it is notable that, rather than try to refute his report, many Spanish critics have impugned his patriotism because he faulted something for which Spain has been praised by Obama and others.
Judge for yourself: Calzada's report can be read at http://tinyurl.com/d7z9ye. And at http://tinyurl.com/ccoa5s you can find similar conclusions in "Yellow Light on Green Jobs," a report by Republican Sen. Kit Bond, ranking member of the Environment and Public Works Committee's subcommittee on green jobs and the new economy.
What matters most, however, is not that reports such as Calzada's and the Republicans' are right in every particular. It is, however, hardly counterintuitive that politically driven investments are economically counterproductive. Indeed, environmentalists with the courage of their convictions should argue that the point of such investments is to subordinate market rationality to the higher agenda of planetary salvation.
Still, one can be agnostic about both reports while being dismayed by the frequency with which such findings are ignored simply because they question policies that are so invested with righteousness that methodical economic reasoning about their costs and benefits seems unimportant. When the president speaks of "new green energy economies" creating "countless well-paying jobs," perhaps they really are countless, meaning incapable of being counted.
For fervent believers in governments' abilities to control the climate and in the urgent need for them to do so, believing is seeing: They see, through their ideological lenses, governments' green spending as always paying for itself. This is a free-lunch faith comparable to that of those few conservatives who believe that tax cuts always completely pay for themselves by stimulating compensating revenue from economic growth.
Windmills are iconic in the land of Don Quixote, whose tilting at them became emblematic of comic futility. Spain's new windmills are neither amusing nor emblematic of policies America should emulate. The cheerful and evidently unshakable confidence in such magical solutions to postulated problems is yet another manifestation -- Republicans are not immune: No Child Left Behind decrees that by 2014 all American students will be proficient in math and reading -- of what the late senator Pat Moynihan called "the leakage of reality from American life."
georgewill@washpost.com
http://www.washingtonpost.com/wp-dyn/content/article/2009/06/24/AR2009062403012.html
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The Climate Change Climate Change
The number of skeptics is swelling everywhere.
Steve Fielding recently asked the Obama administration to reassure him on the science of man-made global warming. When the administration proved unhelpful, Mr. Fielding decided to vote against climate-change legislation.
If you haven't heard of this politician, it's because he's a member of the Australian Senate. As the U.S. House of Representatives prepares to pass a climate-change bill, the Australian Parliament is preparing to kill its own country's carbon-emissions scheme. Why? A growing number of Australian politicians, scientists and citizens once again doubt the science of human-caused global warming.
Among the many reasons President Barack Obama and the Democratic majority are so intent on quickly jamming a cap-and-trade system through Congress is because the global warming tide is again shifting. It turns out Al Gore and the United Nations (with an assist from the media), did a little too vociferous a job smearing anyone who disagreed with them as "deniers." The backlash has brought the scientific debate roaring back to life in Australia, Europe, Japan and even, if less reported, the U.S.
In April, the Polish Academy of Sciences published a document challenging man-made global warming. In the Czech Republic, where President Vaclav Klaus remains a leading skeptic, today only 11% of the population believes humans play a role. In France, President Nicolas Sarkozy wants to tap Claude Allegre to lead the country's new ministry of industry and innovation. Twenty years ago Mr. Allegre was among the first to trill about man-made global warming, but the geochemist has since recanted. New Zealand last year elected a new government, which immediately suspended the country's weeks-old cap-and-trade program.
The number of skeptics, far from shrinking, is swelling. Oklahoma Sen. Jim Inhofe now counts more than 700 scientists who disagree with the U.N. -- 13 times the number who authored the U.N.'s 2007 climate summary for policymakers. Joanne Simpson, the world's first woman to receive a Ph.D. in meteorology, expressed relief upon her retirement last year that she was finally free to speak "frankly" of her nonbelief. Dr. Kiminori Itoh, a Japanese environmental physical chemist who contributed to a U.N. climate report, dubs man-made warming "the worst scientific scandal in history." Norway's Ivar Giaever, Nobel Prize winner for physics, decries it as the "new religion." A group of 54 noted physicists, led by Princeton's Will Happer, is demanding the American Physical Society revise its position that the science is settled. (Both Nature and Science magazines have refused to run the physicists' open letter.)
The collapse of the "consensus" has been driven by reality. The inconvenient truth is that the earth's temperatures have flat-lined since 2001, despite growing concentrations of C02. Peer-reviewed research has debunked doomsday scenarios about the polar ice caps, hurricanes, malaria, extinctions, rising oceans. A global financial crisis has politicians taking a harder look at the science that would require them to hamstring their economies to rein in carbon.
Credit for Australia's own era of renewed enlightenment goes to Dr. Ian Plimer, a well-known Australian geologist. Earlier this year he published "Heaven and Earth," a damning critique of the "evidence" underpinning man-made global warming. The book is already in its fifth printing. So compelling is it that Paul Sheehan, a noted Australian columnist -- and ardent global warming believer -- in April humbly pronounced it "an evidence-based attack on conformity and orthodoxy, including my own, and a reminder to respect informed dissent and beware of ideology subverting evidence." Australian polls have shown a sharp uptick in public skepticism; the press is back to questioning scientific dogma; blogs are having a field day.
The rise in skepticism also came as Prime Minister Kevin Rudd, elected like Mr. Obama on promises to combat global warming, was attempting his own emissions-reduction scheme. His administration was forced to delay the implementation of the program until at least 2011, just to get the legislation through Australia's House. The Senate was not so easily swayed.
Mr. Fielding, a crucial vote on the bill, was so alarmed by the renewed science debate that he made a fact-finding trip to the U.S., attending the Heartland Institute's annual conference for climate skeptics. He also visited with Joseph Aldy, Mr. Obama's special assistant on energy and the environment, where he challenged the Obama team to address his doubts. They apparently didn't.
This week Mr. Fielding issued a statement: He would not be voting for the bill. He would not risk job losses on "unconvincing green science." The bill is set to founder as the Australian parliament breaks for the winter.
Republicans in the U.S. have, in recent years, turned ever more to the cost arguments against climate legislation. That's made sense in light of the economic crisis. If Speaker Nancy Pelosi fails to push through her bill, it will be because rural and Blue Dog Democrats fret about the economic ramifications. Yet if the rest of the world is any indication, now might be the time for U.S. politicians to re-engage on the science. One thing for sure: They won't be alone.
Write to kim@wsj.com
http://online.wsj.com/article/SB124597505076157449.html
Printed in The Wall Street Journal, page A13
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The Dirty War Against Clean Coal
By GREGG EASTERBROOK
Published: June 28, 2009
Washington
WHILE President Obama’s cap-and-trade proposal to reduce greenhouse gases has been the big topic of recent environmental debate, the White House has also been pushing a futuristic federal project to build a power plant that burns coal without any greenhouse gases. Sounds great, right? Except the idea is a rehash of a proposal that went bust the first time around.
More important, the technology already exists to make huge reductions in greenhouse emissions from coal, allowing power companies to begin cutting the carbon footprint of coal today. Instead, advanced-technology coal power sits on the shelf while regulators wait to see what happens with a project that may be just an expensive boondoggle.
The big project, a public-private partnership called FutureGen, was first announced by George W. Bush in 2003. Dreading facing up to the problem of greenhouse gases from electricity generation, the Bush White House suggested that decisions should wait while FutureGen developed a coal-fired power with no emissions. FutureGen’s administrators spent five years on studies, proposals and studies of studies, but never broke ground for a test installation.
Then, in a fit of integrity, the Department of Energy decided the project should be put in Illinois, a Democratic state — Midwestern coal is high in carbon, making this a logical choice — rather than in Republican Texas, which the White House preferred. The administration promptly canceled financing for FutureGen. But this month, Energy Secretary Steven Chu announced he was reviving the project, hinting that the ultimate cost may run to billions of dollars.
FutureGen was better off canceled. Government is good at basic research, poor at commercial-scale applied energy technology. The Synthetic Fuels Corporation, a heavily subsidized attempt begun by the Carter administration to manufacture gasoline substitutes, flopped without ever producing a marketable gallon. The Energy Department has also financed such overpriced, unrealistic projects as the MOD-5B, a wind turbine that weighed 470 tons and stood 20 stories tall: it looked like a gigantic propeller intended to push the earth to a new star system. It ended up being sold for scrap.
The Obama administration’s FutureGen plan calls for yet another year of study before any actual action; test runs may not begin for a decade. No wonder the project’s nickname is “NeverGen.” This is part of a Washington tradition — beginning pie-in-the-sky projects that create an excuse to avoid forms of conservation and greenhouse-gas reduction that are possible immediately. Companies including General Electric have already perfected technology to reduce emissions substantially, called “integrated gasification combined cycle” power. (Yes, it needs a better name.)
Current coal-fired power plants burn pulverized coal using a combustion process that hasn’t changed in a half a century. The new approach turns coal into a gas similar to natural gas, which runs through a device similar to a jet engine. Such plants can achieve near-zero emissions of toxic material and chemicals that form smog, and they require about a third less coal than regular coal-fired power plants to produce an equal amount of energy, which means about a third lower greenhouse gases.
Beyond that, the promising technology of “sequestering” carbon dioxide — pumping it back into the ground to keep it out of atmosphere — appears for technical reasons to be impractical for conventional pulverized-coal power plants. But gasification plants have technical characteristics that should make “sequestration” of carbon feasible. A gasification power plant with sequestration would have around two-thirds lower greenhouse gases than a conventional coal-fired generating station.
The first commercial gasification power plant, designed by General Electric for Duke Energy, is being built in Indiana. Yet, absurdly, most state public-utility commissions have denied requests to construct these environmentally friendly systems. Last year, Virginia denied a major utility’s request to build a coal-fired power plant that would have sequestered nearly all its carbon output.
One reason Virginia gave for the denial was the higher up-front cost of a gasification plant. Yet, once greenhouse gases are regulated (and President Obama’s cap-and-trade plan would in effect tax carbon), the economics of gasification plants may become attractive, with low-emission plants costing less to run.
Another reason for the denials is that utility commissions are waiting for the outcome of the FutureGen experiment. This is a classic instance of the best being enemy of the good. Rather than starting to cut coal-caused carbon emissions right now, we are waiting to see if a hypothetical system could achieve perfection decades from now. Meanwhile, emissions continue willy-nilly.
FutureGen is politically appealing: contractors get subsidies, politicians get to hand out money in their districts and astonishing breakthroughs are promised at unspecified future dates. Why aren’t progressives fighting for an immediate embrace of gasification power? Much of the environmental movement clings to a fairyland notion that coal combustion can soon be eliminated, and therefore no coal-fired power plant of any kind, even an advanced plant, should be built.
Reflecting this mindset, Senate Majority Leader Harry Reid has said he opposes integrated gasification plants — only new solar, wind and geothermal facilities should be allowed. Environmentalists who correctly point out there can never be absolutely “clean coal” thus end up in the position of opposing coal that’s far cleaner than what we are using.
Yet coal use is a future certainty. Half of our power comes from coal, versus about 2 percent from solar and wind: in the next few decades, green power simply cannot grow quickly enough to eliminate the need for coal. We have two choices: do nothing and wait for FutureGen while coal-caused carbon emissions continue unabated; or start building improved coal-fired plants that reduce the problem. Which seems more forward-thinking?
Gregg Easterbrook is the author of “The Progress Paradox” and the forthcoming “Sonic Boom.”
http://www.nytimes.com/2009/06/29/opinion/29easterbrook.html?_r=1&ref=opinion
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The Sound Of Suppressed Science Canada's top authority on polar bears is barred from
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from smalldeadanimals.com .....
The Sound Of Suppressed Science
Canada's top authority on polar bears is barred from ....
......an international meeting on polar bears, of course!
Dr Mitchell Taylor has been researching the status and management of polar bears in Canada and around the Arctic Circle for 30 years, as both an academic and a government employee. More than once since 2006 he has made headlines by insisting that polar bear numbers, far from decreasing, are much higher than they were 30 years ago. Of the 19 different bear populations, almost all are increasing or at optimum levels, only two have for local reasons modestly declined.
Dr Taylor agrees that the Arctic has been warming over the last 30 years. But he ascribes this not to rising levels of CO2 – as is dictated by the computer models of the UN's Intergovernmental Panel on Climate Change and believed by his PBSG colleagues – but to currents bringing warm water into the Arctic from the Pacific and the effect of winds blowing in from the Bering Sea.
He has also observed, however, how the melting of Arctic ice, supposedly threatening the survival of the bears, has rocketed to the top of the warmists' agenda as their most iconic single cause. The famous photograph of two bears standing forlornly on a melting iceberg was produced thousands of times by Al Gore, the WWF and others as an emblem of how the bears faced extinction – until last year the photographer, Amanda Byrd, revealed that the bears, just off the Alaska coast, were in no danger. Her picture had nothing to do with global warming and was only taken because the wind-sculpted ice they were standing on made such a striking image.
Dr Taylor had obtained funding to attend this week's meeting of the PBSG, but this was voted down by its members because of his views on global warming. The chairman, Dr Andy Derocher, a former university pupil of Dr Taylor's, frankly explained in an email (which I was not sent by Dr Taylor) that his rejection had nothing to do with his undoubted expertise on polar bears: "it was the position you've taken on global warming that brought opposition".
Dr Taylor was told that his views running "counter to human-induced climate change are extremely unhelpful".
By the way, the average temperature in the arctic this year is still below zero, "the latest date that this has happened in 50 years of record-keeping".
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Taking the hot air out of wind power
By Chris Bell
The idea of wind generated electric energy is being sold by environmentalists as an overlooked opportunity to reduce greenhouse gasses. Global warming advocates claim that this discounted treasure could be a major part of an effort to reduce the burning of fossil fuels and eliminate the need for some of our nuclear power plants.
Is it true that we are passing up on a gold mine of renewable energy in favor of unnecessary and harmful fossil and nuclear fuels?
Let's start by looking at what we use to generate the power we use today. Renewables, such as wind, solar, biomass, etc, provide 2.4% of our electricity. The bulk of our power, 51%, comes from coal, followed by natural gas at 20% and nuclear at 19%.
Included below in the category "other renewables", wind energy is currently supplying about 1% of our electricity
(http://www.americanthinker.com/Chris%20Bell%201.JPG)
Can we replace coal and natural gas with renewable energy sources? Let's examine the facts.
Wind energy is harnessed by windmills that are similar to the types that have been around for centuries. The windmills that produce electricity are called wind turbines; they employ fan blades that turn when the wind is blowing. These blades are connected to electric generators.
Keep in mind that sometimes the wind blows slowly or not at all, and windmills don't produce any power until the wind reaches about 8 MPH. A location for a windmill is not considered viable unless wind speeds average 14 MPH.
The percentage of its rated power that a windmill can actually produce, given the variation of wind speeds at the installation site, is called its capacity factor. A realistic capacity factor is 25%. That means that over time, the windmill actually delivers 25% of its rated power.
(Electrical energy is measured in units called watts. A kilowatt (KW) is 1,000 watts, a megawatt (MW) is a million watts. )
A typical large wind-driven turbine is rated at about 1,500 kilowatts. It's 350 feet tall and has a fan blade of about 240 feet in diameter. It will actually deliver about 375 kilowatts. It can power about 375 microwave ovens, or 6250 60-watt light bulbs simultaneously (only when the wind is blowing at about 25 miles per hour, which is a very strong wind). An average (1 gigawatt) power plant can power nearly a million microwaves, or 16 million light bulbs at the same time.
A power plant near me produces 1,100,000 kilowatts (1.1 gigawatts) of power. At a 25% capacity factor it would take nearly 2600 large wind turbines to produce the same power as this nuclear power plant. And this is not a particularly large plant.
If you placed these 2600 wind turbines the recommended 5 rotor-blade diameters apart, they would stretch for 600 miles. That's as far as the distance from Michigan to Georgia. In practice wind turbines are not placed single file, they are placed in several rows, like crops, in what are called wind farms, but you get the idea.
The amount of electricity generated by a wind turbine is proportional to the wind speed to the 3rd power (a 20 MPH wind will produce 8 times as much energy as a 10 MPH wind). Therefore wind turbines often produce energy in bursts; when the wind gusts, the energy output spikes, when the wind dies down, energy output dips.
Unfortunately, there is no easy way to store these bursts of energy for later use. There are no batteries large enough that are also practical, and pumped-storage systems, which use unwanted energy to pump water into an aboveground reservoir for later use in turning a water-driven generator, require a large body of water.
And when there is no wind, windmills produce no power, so a traditional power plant must be operational at all times to provide power during those in-between times.
Also, most areas of the country have so little wind that wind turbines are not practical. As indicated in the wind resource map below, most of best energy-producing wind power areas are located far from population centers. The white areas are those that don't have fast enough winds to make wind power viable.
(http://www.americanthinker.com/Chris%20Bell%202.JPG)
Wind power does work. It is a clean and renewable source of energy. But it does have its limitations; we would have to have wind turbines stretching from sea to sea to equal the energy output we can get from traditional power plants, and they would only be a match for conventional power plants when the winds were strong. On calm days they would produce no energy.
And since most of the power would be generated in unpopulated areas, because that's where the strong winds are, (see map above) we would have to incur huge losses to transport this energy to where it is needed.
And after all that, we would still need to maintain our current system of traditional power plants because we would have to have a backup source for when the wind is calm.
And since the traditional power plants can't be turned on and off like a light bulb, it will be necessary to use the traditional power plants to provide the bulk of our power and use the wind generated power to supplement the power plants.
All things considered, wind power has limitations that will relegate it to a role as a supplementary, not a primary, source of our electrical energy.
So the next time you hear a pundit say that we should throw over fossil and nuclear fuel in exchange for wind, know that it is not possible. And any proposals that are predicated on the replacement of natural fossil fuels, such as the replacement of real jobs with "green jobs" is as fallacious as an equation that is predicated on 2 plus 2 equaling 5.
Page Printed from: http://www.americanthinker.com/2009/07/taking_the_hot_air_out_of_wind.html at July 02, 2009 - 01:44:24 PM EDT
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Guinness, great post regarding wind. I am not against wind energy it's just important to keep in perspective that as we increase our investment in it, hopefully private and voluntary, that it will continue to make up closer to 1-2% of thepower on the future grid. That means 98% of our focus should be elsewhere.
It is a tragedy that natural gas is 'wasted' on electrical generation since it is so extremely valuable for other uses. Also a tragedy is our refusal to recognize the merits of nuclear, carbon-free, powerful and safe. We had more deaths from a one-line 19mph light rail line here in one year than in the nationwide history of nuclear power.
If we eventually invent the holy grail car battery and move most of the transportation sector energy to the electrical grid, where then does the additional carbon-neutral energy come from, not to mention grid capacity?
I can think of only two answers, sequestered coal and clean secure nuclear energy.
Back to wind, aside from the lengthy caveats about wind, that half the country isn't windy enough, that none is produced when the wind goes down and none is produced during shut down when the wind is too strong and that they litter, obstruct and dominate the natural landscape, there is a cost factor as well. Best estimates I have read put the cost of wind at 5-times clean coal and solar at 15-times clean coal. Given that disparity I think it wonderful if people choose of their free will to cover their roof with energy security and invest in their own wind tower on their own land, but not a solid payoff for public expenditure.
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Raising energy costs will boost job growth? Newt has a nice way of pointing out what to me seems obvious. Why don't they tell us that destroying the economy as we know it is worth it to save the planet instead of telling us with a straight face that the largest tax increase in history is a jobs, jobs, jobs bill?
http://www.washingtonexaminer.com/opinion/columns/Cap-and-Trade-is-another-way-of-saying-2_2_5-7882637-49117697.html
Newt Gingrich: Cap-and-Trade is another way of saying 2+2=5
By: Newt Gingrich
Examiner Columnist | 6/26/09 6:44 AM
The Obama White House has spent the week furiously working to convince its fellow Democrats in Congress to support the global warming bill that's before the House today. Former Vice President Al Gore has been working the phones, and there was even a luau at the White House last night.
The question that must be asked, however, is why? If the case is closed on man's role in causing climate change, as the left assure us that it is, then why the need to twist Democratic arms to do something about it?
My guess is it has something to do with 2+2=4.
This simple arithmetic - 2+2=4 - was a rallying cry during the Polish Solidarity freedom movement in the 1980s. It meant that, even though the government would try to tell the people that 2+2=5, to be free, the people had to tell the truth, that 2+2=4. Because to deny the truth was to deny reality, and to do that was to surrender freedom to the government.
Something similar is happening with the global warming bill.
The sponsors of the global warming bill, which is known as Waxman-Markey, are telling Americans that not only will the legislation save us from calamitous climate change, it will also produce new jobs and new prosperity by transitioning America to new forms of "green" energy.
In other words, under Waxman-Markey, there's no trade-off necessary to save the planet; no price to be paid. It's a win-win-win.
Right. And 2+2=5.
The reality is that the bill before the House today imposes what could be the largest tax increas
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Some of the fastest growing sources of renewable energy in the world are the wind, the sun -- and the lowly wood pellet.
European utilities are snapping up the small combustible pellets to burn alongside coal in existing power plants. As a global marketplace emerges to feed their growing appetite for pellets, the Southeastern U.S. is becoming a major exporter, with pellet factories sprouting in Florida, Alabama and Arkansas.
(Discuss: What energy source is most important for meeting future U.S. needs? Wood pellets -- cylinders of dried shredded wood that resemble large vitamins -- are the least expensive way to meet European renewable-energy mandates, utility executives and industry consultants say.)
Made from fast-growing trees or sawdust, pellets are a pricier fuel than coal, but burning them is a less-expensive way to generate electricity than using windmills or solar panels. Burning pellets releases the carbon that the trees would emit anyway when they die and decompose, so the process is widely regarded as largely carbon neutral. In contrast, carbon is locked away in coal and is only released once the coal is dug out of the earth and burned.
The wood-pellet market is booming because the European Union has rules requiring member countries to generate 20% of their electricity from renewable sources by 2020. Europe imported €66.2 million (about $92.6 million) of pellets and other wood-based fuels in the first three months of 2009, up 62% from the same period a year earlier, according to the EU's statistical arm.
Government mandates are essential to the increasing use of pellets in power generation, and the growing global pellet trade, experts say.
"You are looking at a totally artificial market," said Christian Rakos, chief executive of Propellets, an Austria-based trade group of pellet producers. "No power plant would consider using pellets for one minute if they didn't have to do it."
Still, Europe's eagerness for more pellets has turned the U.S. into an energy exporter. Until recently, there were only about 40 pellet factories in the U.S., which produced about 900,000 tons a year, mostly for heating homes.
But in May 2008, Green Circle Bio Energy Inc. opened a pellet plant in Cottondale, Fla., that produces 500,000 tons of pellets a year; it ships them by rail to the coast and then on to Rotterdam, Netherlands. The company, owned by Swedish concern JCE Group AB, wants to build another big plant in the U.S., said Olaf Roed, chief executive of Green Circle.
Another 500,000-ton facility in Selma, Ala., owned by Dixie Pellet LLC, also opened last year. And Phoenix Renewable Energy LLC plans to break ground next month on a 250,000-ton-a-year pellet plant in Camden, Ark., along with a 20-megawatt power plant run off tree scraps that will feed heat to the pellet plant. The $100 million facility's output for five years has been contracted to go to Europe, and Phoenix is working on another five facilities.
Pellets can either be made out of sawdust left over from lumber production or from soft-wood trees such as pine. These aren't growing in wild forests, but in industrial plantations where they can be harvested easily and often.
Photo Journal
Jason Henry for The Wall Street Journal
Green Circle employees race to repair one of the pellet mill's dies that give the pellets their compacted cylindrical shape at the plant in Cottondale, Fla., July 1.
At Green Circle's Florida facility, bark is stripped off the tree and burned to generate steam used in making the pellets. The tree itself is cut up in a wood chipper, dried and hammered into a powder, which is formed into pellets under very high pressure.
It is easy for these pellet plants to find raw material. The pulp and paper industry is declining, and the housing slump has sapped the need for hardwood. Forest owners are ecstatic that pellet plants are stepping in.
"We are irrationally exuberant," said Lee Laechelt, executive vice president of the Alabama Forest Owners Association.
Australia, New Zealand, Argentina and Vietnam are also shipping pellets to Europe, as are Canada and South Africa, said Helmer Schukken, CEO of GF Energy BV, a Rotterdam-based trader.
Wood pellets are becoming the newest global commodity, with prices posted on an Amsterdam energy exchange, Mr. Schukken said. "It is becoming like trading coal."
That will make it easier for England's Drax Group PLC, which is installing equipment at its giant 4,000-megawatt coal-fired power plant in North Yorkshire to use pellets in place of coal for up to 10% of the fuel. Pellet makers say Drax is lining up contracts in the U.S. Other big buyers include Dutch power company Essent NV, which is being acquired by Germany's RWE AG, and French GDF Suez SA's Electrabel unit.
Of course, U.S. utilities may soon be as interested as their European counterparts in burning pellets instead of coal. California, which has a goal of producing 33% of its electricity from renewable sources by 2020, is looking at using wood products in coal plants.
If a federal renewable energy standard is approved, "we won't be shipping pellets overseas," said Phoenix Renewable Energy's development director, Steve Walker. "We'll be shipping them domestically."
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second post
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Democrats Admit That Their Cap and Trade Bill Is a Job Killer
By Peter Roff
In her remarks bringing the debate over the climate bill to a close, House Speaker Nancy Pelosi of California urged her colleagues to vote in favor of the cap and trade bill, saying the measure was about four things: "jobs, jobs, jobs, and jobs."
She was right—the House-passed version of cap and trade is all about jobs: jobs lost, jobs never created, jobs sent overseas, and, unbelievably, jobs people will be paid for doing long after they cease to exist.
According to Friday's Washington Times, the legislation includes language that provides, should it become law, that people who lose their jobs because of it "could get a weekly paycheck for up to three years, subsidies to find new work and other generous benefits—courtesy of Uncle Sam."
How generous are these benefits? Well, according to the Times, "Adversely affected employees in oil, coal and other fossil-fuel sector jobs would qualify for a weekly check worth 70 percent of their current salary for up to three years. In addition, they would get $1,500 for job-search assistance and $1,500 for moving expenses from the bill's 'climate change worker adjustment assistance' program, which is expected to cost $4.2 billion from 2011 to 2019."
Instead of being a the source of millions of new jobs of "green jobs"—as House Democrats are fond of saying over and over again—the provision is a hidden admission that their effort is a job killer, not just a massive new tax on energy.
Building a safety net into the legislation is probably the responsible thing to do. The government is going to be directly responsible for the destruction of millions of jobs if the bill passed by the House becomes law—anywhere from a net loss of .5 percent of total jobs over the first 10 years, according to the liberal Brookings Institution, to 3 million by the year 2030, according to the industry-backed Coalition for Affordable American Energy. But wouldn't it be better to leave the jobs alone in the first place? It would certainly be cheaper.
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Bloomberg reports that a respected analyst sees oil prices collapsing further with the economy. Just like artificially high prices helped trigger the downturn, collapsing prices will shut down newer and more expensive energy sources, making the next oil spike even worse if/when we ever see economic health return.
Verleger Sees $20 Oil This Year on ‘Devastating’ Glut (Update1)
http://www.bloomberg.com/apps/news?pid=20601087&sid=aQBXqFcd5gJo
By Grant Smith
July 16 (Bloomberg) -- Crude oil will collapse to $20 a barrel this year as the recession takes a deeper toll on fuel demand, according to academic and former U.S. government adviser Philip Verleger.
A crude surplus of 100 million barrels will accumulate by the end of the year, straining global storage capacity and sending prices to a seven-year low, said Verleger, who correctly predicted in 2007 that prices were set to exceed $100. Supply is outpacing demand by about 1 million barrels a day, he said.
“The economic situation is not getting better,” Verleger, 64, a professor at the University of Calgary and head of consultant PKVerleger LLC, said in a telephone interview yesterday. “Global refinery runs are going to be much lower in the fall. If the recession continues and it’s a warm winter, it’s going to be devastating.”
Crude oil last traded at $20 a barrel in February 2002. Futures were at $61.18 today in New York, having recovered 89 percent from a four-year low reached last December. The Organization of Petroleum Exporting Countries is implementing record supply cuts announced last year in response to plunging consumption.
“OPEC don’t realize the magnitude of the cuts they need to make,” which would total about a further 2 million barrels a day, Verleger added. “Storage is going to become tight. It’s not clear if there’s going to be enough storage available.”
China, Inflation
Oil will average $63.91 in the fourth quarter, according to the median of analyst forecasts compiled by Bloomberg. Crude for December delivery traded at $65.61 today in New York. Prices have rebounded on expectations of a demand recovery, led by China and other developing economies, and concern expansionary monetary policy would stoke inflation and weaken the dollar.
At the other end of the spectrum from Verleger, Goldman Sachs Group Inc. predicted in a report yesterday oil will rally to $85 a barrel by the end of the year, and recommended that clients buy futures contracts for delivery in December 2011.
“China is in a real desperate situation,” said Verleger, who publishes the Petroleum Economics Monthly. “We’re in a situation where U.S. consumers aren’t consuming and Chinese manufacturers get hurt. Economists are looking for growth in all the wrong places.”
Forward contracts for oil have been higher than prices for immediate delivery this year, a situation known as contango, creating incentives to buy crude now and store it. That may end as growing stockpiles make storage more expensive.
“Prices would be much lower today, but for the very large incentive to build inventories,” Verleger said. “You need forward buyers, which we had when people were fearing inflation, but as concerns turn toward deflation” that will no longer be the case.
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August 04, 2009
Green Jobs: Fast-tracking Economic Suicide
By Michael Economides and Peter Glover
Creating ex nihilo -- literally, out of nothing -- used to be a theological concept, God's prerogative. Today it seems, President Barack Obama and certain Western politicians claim to possess the ability to do it. Against all the laws of economics and the marketplace, they believe they can create millions of ‘green' real jobs, out of thin air, or at least air without carbon dioxide, via cap and trade.
If Obama & Co. were to remove their green-tinted glasses for just a moment and take a long hard look at the European experience they profess to cite as ‘proven', they would discover those glasses have been rose-tinted all along.
The basic assumption is that technology per se generates jobs. Mostly, it does not. Rather, technology enables jobs -- real and sustainable jobs -- based on how useful the technology is to the marketplace. To generate real industrial jobs, however, one needs a basic commodity to trade, and in the energy business this has meant oil, gas or coal. Yet ‘green' politicians and eco-lobbyists expect to create a revolution in green jobs based on ... alternative energy sources. The trouble is that alternative energy sources remain and will continue to be appallingly inefficient, offering a very poor to mostly negative return on investment. Cut off the flow of massive public subsidies and the alternative energy industrial revolution would grind to a halt tomorrow -- as the European experience already bears out.
What the EU experience shows is that for every green job created per installed MW power, a real job is destroyed elsewhere in the economy. Not to mention, it aids the reduction of competitiveness, investment in expansion and, ultimately, promotes the relocation of major companies to countries without draconian carbon regimes that cause energy price hikes.
It's a shame that members of the US Congress that voted for the recent Cap and Trade Climate Bill did not bother to check up on the economic realities which are causing European states to back away from expensive alternative energy commitments and the ‘green job' creation schemes associated with them by inserting all manner of substance-emptying ‘get-out' clauses into EU cap and trade plans.
Germany's Angela Merkel has already insisted on major exemptions for German heavy industry come December's ‘definitive' global climate summit in Copenhagen. Bizarrely, for a so-called ‘Green Chancellor', Merkel's government is also supporting the building of 26 new coal-fired power plants across Germany. Hardly the domestic agenda of a low-carbon ‘green jobs' economy. Italy also rocked the EU climate boat by insisting on exemptions for its own energy-intensive industries at the turn of the year. Most significantly, it is an exemption that requires the EU to renegotiate Europe's entire climate policy after the UN summit in December -- effectively, giving Italy a veto. A veto it will use if, as expected, China and India and others exempt themselves from binding targets. In June, deputy head of Poland's Solidarity trade union, Jaroslaw Grzesik, estimated that the EU's climate policy would cost 800,000 European jobs. The think-tank Open Europe has already estimated that the same policies will cost the UK $9 billion a year, leaving an extra 1 million people in fuel poverty by 2020.
These are the real world economic realities for "countries like Spain, Germany and Japan" that Barack Obama insisted in January 2009 are "surging ahead of us" in the low carbon-green jobs revolution. Cited as a role model, Spain is the only country to have produced an in-depth analysis of the impact of renewables on the jobs market. The Study of the effects on employment of public aid to renewable energy sources was published by a team at the Universidad Rey Juan Carlos in March, 2009. Though it grabbed a few headlines in the spring, it was largely ignored by the mainstream press. Yet it is the most intensive review of the impact of a state-aided green job creation policy available. Here are just a few of its key statements suggesting why the state should stay the heck out of manipulating the job creation market:
"Despite its hyper-aggressive (expensive and extensive) ‘green jobs' policies ... Spain has created a surprisingly low number of jobs."
"Since 2000 Spain has spent €571,138 ($800K) to create each ‘green job', including subsidies of more than €1million ($1.4million) per wind industry job."
"The programs creating those jobs also resulted in the destruction of nearly 110,500 jobs elsewhere in the economy or 2.2. jobs destroyed for every ‘green job' created."
"Each ‘green' megawatt installed destroys 5.28 jobs on average elsewhere in the economy: 8.99 by photovoltaics (solar), 4.27 by wind energy, 5.05 by mini-hydro."
The report also notes that according to Spain's energy regulator, "The price of a comprehensive electricity rate (paid by the end consumer) in Spain would have to be increased 31 percent to repay the historic debt generated by the subsidies to renewables."
The report cites key examples of resulting "massive unemployment, loss of capital, dismantlement of productive facilities and perpetuation of inefficient ones" the direct result of, "the arbitrary, state-established price systems inherent in ‘green energy' schemes." The report concludes, "Policymakers must recognize that because of government action, other jobs are not created." And, most significantly for international consumption, "These costs do not appear to be unique to Spain's approach but instead are largely inherent in schemes to promote renewable energy sources."
President Obama maintains his planned 5 million new jobs will cost the taxpayer $30,000 per job. Bad enough, we might think. But The Center for American Progress, whose CEO headed-up Obama's transition team, calculates it would take government spending of $100 billion to create 2 million green jobs. That's a cost to the taxpayer of $50,000 to create a single "green job". The Apollo Alliance, whose founder served on Obama's campaign, calculates it would take $500 billion to create 5 million jobs. That's a mere $100,000 per green job created.
Worrying about others "surging ahead" no longer matters once you realize it's along the fast-track to economic suicide. Green jobs? It's not good for the economy, stupid.
Michael Economides is Editor-in-chief at Energy Tribune & Peter Glover is European Associate Editor, Energy Tribune.
Page Printed from: http://www.americanthinker.com/2009/08/green_jobs_fasttracking_econom.html at August 04, 2009 - 11:20:21 AM EDT
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August 6, 2009
The Economic Consequences of Waxman-Markey: An Analysis of the American Clean Energy and Security Act of 2009
by David Kreutzer, Ph.D., Karen Campbell, Ph.D., William W. Beach, Ben Lieberman and Nicolas Loris
Center for Data Analysis Report #09-04
After a truncated debate and last-minute changes, the House of Representatives narrowly passed climate-change legislation on June 26, 2009, designed by Henry Waxman (D-CA) and Edward Markey (D-MA). The 1,427-page bill would restrict greenhouse gas emissions from industry, mainly carbon dioxide from the combustion of coal, oil, and natural gas.
Since energy is the lifeblood of the American economy, 85 percent of which comes from CO2-emitting fossil fuels, the Waxman-Markey bill represents an extraordinary level of economic interference by the federal government. For this reason, it is important for policymakers to have a sense of the economic impact that accompanies any environmental benefits.[1]
Analysis by The Heritage Foundation's Center for Data Analysis (CDA) makes clear that Waxman-Markey promises serious perils for the American economy for the years and decades ahead. Waxman-Markey requires arbitrary and severe restrictions on the current energy supply and infrastructure. These restrictions can be met only through large-scale deployment of still-undeveloped or uneconomical technologies and alternative energy sources. In addition to the direct impact on consumers' budgets through higher electric bills and gasoline prices, the resultant increase in energy costs will reverberate throughout the economy and inject unnecessary inefficiencies at virtually every stage of production. It would suppress economic activity and reduce employment, especially in the manufacturing sector. Virtually all costs would eventually filter down to the American people.
(http://www.heritage.org/research/energyandenvironment/images/CDA-waxman-markey-chart-jobs.gif)
Waxman-Markey extracts trillions of dollars from the energy-using public and delivers this wealth to various groups--some of whom may be more deserving than others, and some who are simply better at lobbying. That could mean low-income households in an attempt to compensate them for sharply higher energy costs, or regulated industries that have effectively lobbied for compliance assistance. In any event, cap-and-trade allowances are a tax and would be the largest tax increase in recent history.
The recent experience with ethanol-use mandates illustrates the costs and unanticipated (at least by proponents) problems with a federal intervention in energy markets. However, Waxman-Markey represents a vastly more complex and comprehensive scheme, which suggests that the scope and intensity of unintended effects could be greater than either proponents or critics of Waxman-Markey currently anticipate. In addition, Europe's experience with climate-change laws similar to Waxman-Markey strongly suggests both high costs and uncertain emissions reductions.
Overview
Waxman-Markey imposes strict limits on the emissions of six greenhouse gases (GHGs) with the primary emphasis on carbon dioxide (CO2). The mechanism for capping these emissions requires regulated emitters to acquire federally created permits (allowances) for each ton emitted. The allowances have the economic effect of a tax--energy users will, of course, have to pay for the energy itself, and will also have to pay for the rights to use it if its production involved one of the regulated greenhouse gases. The increase in energy costs stemming from paying for these permits to emit creates correspondingly large transfers of income from private energy consumers to special interests: the federal government collects the revenues from the sale of the allowances and redistributes them to individuals and groups (businesses included) that are listed in the legislation.
Implementing the Waxman-Markey legislation will be very costly, even given the rather optimistic assumptions about how effective it will be in reducing CO2 emissions and how accommodating the economy will be to the added energy costs. The Heritage Foundation's dynamic analysis of these economic costs are summarized as follows (adjusted for inflation to 2009 dollars):
Cumulative gross domestic product (GDP) losses are $9.4 trillion between 2012 and 2035;
Single-year GDP losses reach $400 billion by 2025 and will ultimately exceed $700 billion;
Net job losses approach 1.9 million in 2012 and could approach 2.5 million by 2035. Manufacturing loses 1.4 million jobs in 2035;
The annual cost of emissions permits to energy users will be at least $100 billion by 2012 and could exceed $390 billion by 2035;
A typical family of four will pay, on average, an additional $829 each year for energy-based utility costs; and
Gasoline prices will rise by 58 percent ($1.38 more per gallon) and average household electric rates will increase by 90 percent.
This CDA analysis extends only to 2035, as this is the forecasting horizon for the macroeconomic model used to prepare these estimates. But it should be noted that the emissions reductions continue to tighten through 2050 and that model-based analysis by other groups whose models extend beyond 2035 shows increasing harm to the U.S. economy.
In addition to burdening households, the high energy prices weaken the production side of the economy. Contrary to the claims of an economic boost from "green" investment as firms undertake the changes to reduce emissions and increased employment as so-called green jobs are created to do this work, Waxman-Markey would be a significant net drain on GDP and employment.
Description of the Legislation
Waxman-Markey is a cap-and-trade bill. It caps greenhouse gas emissions from regulated entities beginning in 2012. At first, each power plant, factory, refinery, and other regulated entity will either be allocated allowances (rights to emit) for six greenhouse gases, or be made to purchase these allowances, or some combination of the two. In the early years, most of the allowances will be given away. Perhaps one result of the ill-conceived last-minute changes is that for some years there are promises to distribute more than 100 percent of the available allowances to various interest groups. However, Heritage analysts assume, as do the bill writers, that most emitters will need to purchase at least some allowances. Note that whether allowances are sold or given away had no effect on the energy cost increases, which are caused by the constraint on supply.
Emitters who reduce their emissions below their annual allotment can sell their excess allowances to those who do not--the trade part of cap and trade. Over time, the cap is ratcheted from a 3 percent reduction of 2005 levels (the base year for measuring and mandating future GHG reductions) by 2012 to an 83 percent reduction by 2050.
Effects on Industry
Waxman-Markey affects some industries more than others. Some industries are undoubtedly more energy-intensive and thus hit harder by higher energy prices. Particularly alarming is the damage that Waxman-Markey inflicts on America's manufacturing base. By 2035, the last year of the simulation, durable manufacturing employment will have lost 1.17 million jobs. Nondurable manufacturing losses reach almost 210,000 jobs by 2035. Combined, manufacturing employment averages 389,000 less than the baseline between 2012 and 2035, hitting a high of 1.38 million lost jobs in 2035. [1]
Other industries experience the effects of higher energy prices as well. The fabricated-metal industry will see jobs drop by an average of more than 51,000 below the baseline and 216,000 below by 2035. The machinery industry will shed 263,000 jobs by 2035. Plastic and rubber products employment falls 33,000 jobs below the baseline on average as a result of Waxman-Markey and is 80,000 below business-as-usual in 2035, the last year of the simulation. The employment-services industry faces substantial losses, reaching 428,000 in 2035 and averaging 93,000 fewer jobs than the baseline from 2012 to 2035.
Two other industries adversely affected by this cap-and-trade legislation are transportation and trade. With cap-and-trade regulation, retail-trade unemployment increases by 276,000 in 2035, with a yearly average loss of 78,000, while wholesale trade unemployment increases by 400,000 in 2035, and 191,000 on average each year. The trade, transportation, and utilities sector losses reach 1.1 million jobs by 2035 and 441,000 for the yearly average. Transportation and warehousing employment drops 383,000 by 2035 and has an average yearly loss of 175,000 jobs.
Because agriculture is energy intensive, it would be disproportionately burdened by Waxman-Markey. Higher gasoline and diesel fuel prices, higher electricity costs, and higher natural-gas-derived fertilizer costs all erode farm profits, which are expected to decline by 28 percent in 2012 and average 57 percent lower through 2035.
Also noteworthy are the effects on gas stations, which tend to be small businesses. Employment in the gas station industry is an average 33,000 jobs below the baseline every year from 2012 through 2035.
The model also includes an industry-production index. An industry-production index is a composite measure of the output produced by each of the companies within an industry. Roughly, the index is created by a weighted average of the total output by each company within an industry divided by the base year's weighted average total.[2] The index is based on a common year and, therefore, provides a comparable measure of increases or decreases in an industry's output over time.
Of all the industries modeled, only a handful showed increases in output under Waxman-Markey.[3] Most decreased, and the set of industries whose output fell the most include:
durable goods,
railroad equipment,
miscellaneous manufacturers,
motor vehicles and parts,
light truck and utility vehicles,
electrical equipment, appliances, and components,
communications equipment, computers, and electronics,
engines and turbines,
metalworking machinery,
construction,
agricultural equipment,
glass and glass products,
rubber and plastic products,
medical equipment and supplies, and
mining and its support activities.
[1]The term "baseline" refers to the projections of the U.S. economy's future between 2009 and 2035 without the Waxman-Markey legislation becoming law. This baseline does contain all of the enacted energy legislation by this and previous Congresses. For example, the baseline used in this CDA Report contains the current law about fuel efficiency standards and the development of alternative energy sources.
[2]For a more precise description of production indices as well as the methodology used to compile them, see "Studies in Methods--Index Numbers of Industrial Production," Series F, No. 1, United Nations Statistics Division, Department of Economic and Social Affairs, 2008, at http://unstats.un.org/unsd/cr/temp/IIP_Draft_version_080502.pdf (July 24, 2009).
[3]Those industrial groupings that increase are: leather and allied products; bags and coated and treated paper; semiconductors; newspapers and misc. publishers; periodicals; books; and cutlery and hand tools. The first most likely reflects a consumer switch from synthetically produced materials that require relatively more emissions. There is a broad applicability of semiconductors along with a need to find new technological processes. Newspapers and other media may historically be somewhat inversely related to unemployment as less work time may increase the demand for reading material both for leisure and education. Cutlery and hand tools may be driven by more labor-intensive processes, rather than motorized processes.
Allowance Giveaways
President Obama's budget proposal suggested a 100 percent auction of the emission allowances, forcing companies to bid on the right to emit. In order to get the Waxman-Markey cap-and-trade bill through the House Energy and Commerce Committee, however, Members of Congress promised generous handouts for various industries and special interests. In the near term, the legislation promises to distribute 85-101 percent of the allowances to various interest groups at no cost. The percentages for each industry decrease over time.
Electric Utilities. The biggest winners are the electric utilities, receiving 43.75 percent of the emission allowances in 2012 and 2013. The free allowances fall to 38.89 percent in 2014 and 2015, and 35 percent from 2016 through 2025. Beginning in 2026, the freely distributed allowances fall by 7 percent per year, until they reach zero by 2030. Small local-distribution electric companies are given 0.5 percent of the allowance value from the enactment of the bill through 2025; it is then reduced by 0.1 percent until it reaches zero. Energy-efficient cogeneration facilities receive 0.35 percent in the first year, but nothing after that.
Energy Sectors. The natural gas industry receives 9 percent of the allowances beginning in 2016, until they are reduced by 1.8 percent per year beginning in 2026. The handouts reach zero in 2030. For home heating oil and propane consumers, only 1.88 percent of the allowances are given in years 2012 and 2013. This decreases to 1.67 percent for the next two years, and to 1.5 percent from 2016 through 2025. After this they are phased out by 0.3 percent each year. Oil refiners receive 2 percent of the allowances from 2014 through 2026. On top of this, small business refineries will receive 0.25 percent from 2014 to 2026.
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Protecting the Poor. The bill stipulates that the revenues from 15 percent of the allowances sold at auction will go to low-income consumers.
Trade-Affected Industries. Energy-intensive and "trade-exposed" industries will undoubtedly be at a competitive disadvantage in relation to companies in other countries that do not put a price on carbon emissions. To mitigate this result, the bill gives 2 percent of the allowances to affected industries for the first two years of the bill's enactment, which increases to 15 percent beginning in 2014, and then slowly phases them out to zero by 2035.
(http://www.heritage.org/research/energyandenvironment/images/CDA-waxman-markey-chart-allowances.gif)
Transitioning to Cleaner Energy. To invest in clean technology and renewable energy, 10.05 percent of the free allowances are set aside beginning immediately in 2012. The majority of these allowances will go to State Energy and Environmental Development (SEED), which allows state energy offices to allocate the revenue to specified energy efficiency and renewable energy programs. A small portion, 0.5 percent, goes toward more energy-efficient building codes. The free allowances fall to 7.05 percent for 2016 and 2017, 6.03 percent for 2018 to 2021, 1.53 percent for 2022 to 2025, rises back to 8.58 percent from 2026 to 2029, and remains at 5.03 percent thereafter. The auto industry receives 3 percent of the allowances from 2012 to 2017, and 1 percent from 2018 to 2025.
Universities, institutions, and any "Clean Energy Innovation Center," which will study energy-efficient building systems and designs, are awarded 1.05 percent of the allowances beginning in 2012 and lasting until 2050. Eight energy-innovation hubs at universities, private research entities, industry sites, or state institutions that focus on clean-energy technology will receive 0.45 percent of allowances from 2012 through 2050. Worker-assistance programs receive 0.5 percent of the allowances from 2012 through 2021, and 1 percent for 2022 through 2050. For the year 2012 only, 1 percent is designated to early actors, which rewards those who have already taken approaches to reduce carbon dioxide emissions, such as no-till farming and planting trees. The allowance revenue would only be available for entities that publicly stated and reported greenhouse gas reduction goals and demonstrated net reductions. The allowances cover only "reduction activity" that took place between January 1, 2001, and January 1, 2009. To foster the deployment of carbon capture and sequestration (CCS), a relatively untried process that reduces the amount of carbon dioxide emissions from industrial facilities, the bill allocates 1.75 percent of the emission allowances from 2014 through 2017, 4.75 percent from 2018 to 2019, and 5 percent from 2020 through 2050 for installing and operating CCS technologies.
Supplemental Reduction. From 2012 to 2025, 5 percent of the allowance revenue will be allocated for supplemental reduction, such as for funding international forestry products. This falls to 3 percent in 2026, to 2 percent in 2031, and continuing through 2050. Supplemental agriculture and renewable energy receive 0.28 percent of the handouts beginning in 2012 and ending in 2016.
(http://www.heritage.org/research/energyandenvironment/images/CDA-waxman-markey-chart-renewables.gif)
Adaptation Efforts. Domestic adaptation efforts to protect humans, landscapes, and wildlife affected by climate change receive 0.9 percent of the allowances from 2012 through 2021, growing to 1.9 percent in 2022 and to 3.9 percent in 2027. Specifically, 0.1 percent of the allowance handouts will go to the Climate Change Health Protection and Promotion Fund from 2012 to 2050 to protect the health of humans affected by climate change; 0.385 percent and 0.615 percent go to wildlife and natural-resource adaptation distributed to states and the Natural Resources Climate Change Adaptation Fund, respectively. These percentages increase to 0.770 and 1.23, respectively, for the years 2022 to 2026, and increase again to 1.54 percent and 2.46 from 2027 to 2050.
International adaptation to increase resilience as well as reduce vulnerability to climate change and international deployment of clean-energy technologies receive 1 percent each from 2012 to 2021, increasing to 2 percent each year beginning in 2022, and increasing again to 4 percent from 2027 through 2050.
Macroeconomic Simulation Overview
In a market-based economy, most effects of a policy are transmitted through price signals that are driven by changes in consumption and production decisions at the micro level. The aggregate impact these changes have on the economy is based on how these price signals interact with other markets and shift the economy's resources. Moving below the baseline means that the economy is operating less efficiently and that, therefore, the resources in the economy were better utilized under the baseline scenario than under the new policy.
Heritage analysts used the IHS Global Insight long-term macroeconomic model of the U.S. economy to estimate the effects of the Waxman-Markey bill on the overall economy.[2] The simulation was implemented by changing variables in the macroeconomic model according to the changes predicted by a microeconomic model of the energy sector maintained by the CDA (see the section describing the CDA energy model below). In order to estimate the policy impact, three main pieces needed to be simulated: (1) price effects, (2) energy-efficiency (demand) effects, and (3) allowance revenue and allocation effects.
The policy changes in Waxman-Markey affect pro ducer prices in the energy sectors directly through the cost of purchasing allowances and offsets as well as through changes in production needed to reduce emissions.[3] The energy model estimated the change in energy production prices and retail energy prices. These prices were matched with their corresponding variables in the macroeconomic model to estimate the effect these price changes would have on the overall economy.
The energy model projects changes in fuel efficiency and changes in total highway fuel consumption. The corresponding macroeconomic model variables were changed. The effect of these changes helps mitigate some of the total increased consumer expenditure on fuel.
The macroeconomic model does not have specific variables corresponding to the alternative renewable fuel sources in the CDA energy model. The macroeconomic simulation takes into account the increase in domestic alternative-fuel sources by adjusting the amount of imported fuel.
The last piece of the simulation is the allowance revenue component. As discussed above, the value of permits equals the entire value of these permits as government revenue, regardless of whether they are formally auctioned. As much as possible, the revenue allocations followed the details in Henry Waxman and Edward Markey's May 14, 2009, memo "Proposed Allowance Allocation."[4] Any unallocated allowance revenue remained in the federal government's general consumption variable and was thus allocated by the model in ways consistent with the historical pattern of government spending.[5]
The Waxman-Markey Energy Model
To meet the emissions reduction goals of Waxman-Markey, the price of fossil-fuel energy must increase enough to drop the quantity demanded to the target levels. The allowance price is the tax on fossil-fuel energy that causes the price to increase. The allowance tax will be determined as refiners, electric companies, natural gas distributors, and certain other energy users bid against each other for the allowances. As the allowance price increases, these bidders will find it increasingly difficult to pass the costs on to the ultimate consumers, thus they bid for fewer allowances. This, in turn, restricts the amount of fossil fuel that will be consumed and determines the added price consumers must pay for energy.
The amount of CO2 emitted per unit of energy generated depends on the type of fuel used. The energy model used by the Center for Data Analysis is based on the IHS Global Insight energy module and adds the appropriate cost to each energy source for various allowance prices.[6]
Further, the model incorporates estimates of user responses to price changes (demand elasticity) for natural gas, petroleum products, coal, and electricity. Following a well-known pattern, this responsiveness to price changes grows over time.
In the CDA model, the allowance prices for all years are adjusted until the aggregate amounts of CO2 emissions from all fuels reaches the target emissions for that year. To account for offsets, the targets are increased by 15 percent above the caps for every year. In the early years, the business-as-usual emissions are greater than the allowances alone, but less than the allowances plus offsets. For those years, the allowance price is set at the estimated world clearing price for offsets--$20 per ton. Beyond the year 2018, the offsets limits are reached and the allowance price rises as the caps become tighter. The allowance price exceeds $120 per ton of CO2 by 2035.
The Economic Costs of Waxman-Markey
The Waxman-Markey bill affects the economy directly through higher prices for carbon-based energy, which reduces quantity demanded and, thus, the quantity supplied of energy from carbon fuels. Energy prices rise because energy producers must pay a fee for each ton of carbon they emit. The fee struc ture is intended to create an incentive for producers to invest in technologies that reduce carbon emissions during energy production. The bill's sponsors and supporters hope that the fees are sufficiently high to create a strong incentive and demand for cleaner energy production and for the widespread adoption of carbon capture and sequestration technology.
The economic model that CDA analysts used to estimate the bill's broad economic effects treats the fees as a tax on energy producers. Thus, energy prices increase by the amount of the fee or tax. The demand for energy, which largely determines the consumption and, thus, the taxes collected, responds to higher energy prices both directly and indirectly. The direct effect is a reduction in the consumption of carbon-based energy.
The indirect effects are more complex. Generally speaking, the carbon fees reduce the amount of energy used in producing goods and services, which slows the demand for labor and capital and reduces the rate of return on productive capital. This "supply-side" impact exerts the predictable secondary effects on labor and capital income, which depresses consumption.[7]
These are not unexpected effects. Carbon-reduc tion schemes that depend on fees or taxes attain their goals of lower atmospheric carbon by slowing carbon-based economic activity. Producers and consumers respond to the carbon taxes both by switching to less carbon-intensive production and consumption and by simply reducing production and consumption.
The Heritage study assumes that renewable electricity generation (not including conventional hydro) and biofuels grow by a factor of four between 2010 and 2035. The baseline used in the Heritage analysis already includes significant increases in wind energy, solar power, ethanol, biodiesel, and biomass-derived energy. So, the economic impacts are in addition to the costs of these large baseline increases in alternative energy supply.
With the combined impact of these responses, policymakers can expect results similar to the following economic effects:[8]
(http://www.heritage.org/research/energyandenvironment/images/CDA-waxman-markey-chart-GDP.gif)
Economic Output Declines. The broadest measure of economic activity is the change in GDP after accounting for inflation. GDP measures the dollar value of all goods and services produced in the United States during the year for final sale to consumers. The changes that Waxman-Markey causes in GDP are a broad measure of the altered pattern of all other economic variables.
The initial shock of higher energy prices reduces GDP by nearly $200 billion in each of the first few years. As always, markets strive to counter shocks. Because of the generosity of the offsets, the carbon constraints do not further tighten until 2018 and markets move GDP closer to the higher baseline levels. However, after 2018 the carbon limits put ever increasing pressure on energy markets and GDP losses grow each year. Though the annual losses decrease somewhat after 2032, the Waxman-Markey impact continues to destroy more than $600 billion of GDP value every year until the end year of the Heritage analysis (2035).
Driving energy prices higher is a fundamental feature of cap and trade. It is the higher price of fossil-fuel energy (85 percent of U.S. energy) that forces firms and households to use less of it. There is no allowance-distribution scheme that can lower overall energy costs. Though some allowances given to regulated electric utilities may, at least initially, lower prices for their customers, this would undermine the necessary conservation and force greater costs on other consumers. There will be no net energy price reductions. Further, allowances given to unregulated firms will simply go to the bottom line and not to consumers.
In aggregate, the GDP losses for 2012 to 2035 are $9.4 trillion even after adjusting for inflation.
This slowdown in GDP is seen more dramatically in the slump in manufacturing output. Indeed, by 2020, manufacturing output in this energy-sensitive sector is 2 percent below what it would be if Waxman-Markey never becomes law. By 2035, the manufacturing sector has lost $585 billion in output when compared to the CDA baseline; that is, when compared to the economic world without Waxman-Markey.
Number of Jobs Declines. Though lost GDP is the broadest measure of the economic impact, it often seems a remote measure. Looking beneath the surface of GDP shows the economic reactions to the legislation that led up to the drop in output. The change in employment is one such reaction.
Instead of creating jobs, Waxman-Markey is a job destroyer. Compared to the baseline (a no-Waxman-Markey world), the average year has 1.1 million fewer people working. By 2035, this Waxman-Markey jobs deficit has risen to nearly 2.5 million lost jobs.
The job losses are widely, but not evenly, distributed. For instance, the construction industry loses 8.5 times as many of its jobs than the economy as a whole. The job-loss rate for the textile industry is more than 7.8 times the rate of overall job loss; 4.4 times the overall rate for manufacturing; 5.9 for durable manufacturing; 5.3 for paper products; and 7.1 for wood products.
Because the distribution of energy-intensive jobs across the country is unequal, some states and congressional districts will be hit particularly hard. Notable among the most adversely affected states throughout the duration of the bill are: Wisconsin, Indiana, Minnesota, Iowa, New Hampshire, North Carolina, South Carolina, Idaho, and Alabama. Some states, such as Wyoming, North Dakota, Colorado, and Nebraska are most adversely affected when the policy first takes effect, while other states, such as Michigan, Ohio, and Tennessee, are among the hardest-hit states by 2035.[9]
Energy Prices Rise. The policy-induced higher energy prices, which signal the constraint of energy, are the root cause of the slower economy. As Chart 5 shows, consumer prices for electricity, natural gas, and home heating oil increase significantly between 2015 and 2035. Indeed, by 2035, the total energy bill for a family of four is $1,200 higher than it would be otherwise. Between 2012 and 2035, the total increase in expenditure on energy is nearly $20,000. This increase occurs not only after adjusting for inflation, but also after households have adjusted as well as possible to the higher energy prices.
(http://www.heritage.org/research/energyandenvironment/images/CDA-waxman-markey-chart-energy.gif)
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By 2035, Waxman-Markey causes electricity prices to rise 90 percent over and above the rise that would have occurred anyway. By turning thermostats down in winter and up in summer; by purchasing more energy-efficient, but more expensive, appliances; by adding more insulation to houses; by living in smaller houses; and by manifold other changes, U.S. energy consumption is cut by more than 30 percent. Nevertheless, even these cuts are not sufficient to fully offset the price increase for electricity. The net effect is that a family of four will spend $468 more on electricity alone because of Waxman-Markey.
Incomes and Consumption Decline. Higher energy prices also drive up production costs, which must be reflected in product prices. Since higher prices reduce quantities sold, producers produce less. In turn, workers and investors earn less, and household incomes decline. The especially sharp income and employment reductions in the energy-intensive sectors spread and cause declines in demand for other sectors of the economy.
The CDA simulation captures this effect of higher energy prices. Consumption outlays by individuals and house holds follow the pattern of lower income. In 2012, consumption expenditures are $129 billion lower than they would be in an economic world in which Waxman-Markey is not the law. By 2030, the drop in consumption expenditures reaches $357 billion--$3,823 less per family of four.
Taxes Increase. The allowances created by Waxman-Markey to restrain CO2 emissions do not create economic value, which is another way of saying that the allowances do not improve the material well-being of Americans. Instead, they are a form of taxation and will be one of the largest taxes collected by the federal government.[10] This tax created by Waxman-Markey will collect $5.7 trillion over the period 2012 to 2035--at a cost of thousands of dollars per year per family.
(http://www.heritage.org/research/energyandenvironment/images/CDA-waxman-markey-chart-debt.gif)
National Debt Grows. Because the Waxman-Markey cap-and-trade tax reduces income, it reduces the revenues collected from other taxes, such as personal and corporate income taxes. And because the revenue collected from Waxman-Markey is spent, the net effect is to increase the national debt. By 2035, Waxman-Markey will have added 9.1 trillion nominal dollars to the national debt, which amounts to an increased tax liability of $12,803 for every American, or a $51,216 liability for a family of four in today's (2009) dollars.
Climate Impact Does Not Register. Because of market-driven increases in energy efficiency, CO2 emissions have grown more slowly than has national income for decades in the United States.[11] Contrasted with the moderating growth of American CO2 emissions, those of the developing world, especially China and India, have been accelerating. China is now the world's largest emitter of CO2. Because the developing world is so populous and because large segments are finally experiencing the rapid economic growth that perverse economic policies had previously stifled, the growth in CO2 emissions will swamp the cuts proposed in the U.S. by Waxman-Markey.
Climatologists estimate that Waxman-Markey's impact on world temperature will be too small to even measure in the first several decades. The theoretical moderation of world temperature would be 0.05 degree centigrade by 2050. If CO2-emission levels meet the Waxman-Markey target of 17 percent of 2005 emissions by the year 2050, and if they are frozen at that level for the rest of the century, Waxman-Markey would still reduce the world temperature by only 0.2 degree Celsius by 2100.
Cost to Americans: Hundreds--or Thousands?
Analyses of the economic impact of Waxman-Markey fall into two basic categories: (1) studies that show annual economic costs to be a few hundred dollars per family per year; and (2) others showing family costs measured in thousands of dollars per year.
These two notable "postage stamp" studies come from the EPA and the Congressional Budget Office.[1] The EPA asserts that Waxman-Markey will reduce household consumption by $98 to $140 per year throughout the duration of the policy. What is never mentioned by those trumpeting this number is what it really means.
First, the EPA employs a technique from the financial world called "discounting" to reduce the value. For example, the EPA estimates that the inflation-adjusted cost per household in 2050 will be $1,287. However, after this value is discounted to the present, the cost is $140 per household.[2] Note that discounting is not done to adjust for inflation--that has already been done. Present-value discounting is a technique for comparing the value of money paid at different points in time. If a household must pay $1,287 in 2050, the $140 represents the amount that household would have to pay into an interest-bearing account today so that the interest would allow it to grow to $1,287 by 2050. Discounting can be a legitimate tool for cost-benefit and investment analysis where costs and benefits are paid and benefits received at different times. Thus, both are discounted to the same point in time and compared. Without discounted environmental impacts for comparison, using the technique, here, does little except undercount the cost that families will actually be paying in 2050.
Second, the EPA measures consumption, not income. The broadest and best measure of cost is lost income--lost GDP. Consumption only comes after taxes and savings are deducted. Ignoring lost savings and lost payments for government services underestimates the costs by about 40 percent.
Third, the EPA measures cost per household. Households are not necessarily families. One person living alone counts as a household, as do three single people sharing an apartment. The EPA uses the average household size of 2.6 people. Converting from this EPA household size to a family of four adds more than 50 percent to the cost estimate.
So, the EPA's $174 cost per household is actually above $2,700 (even after adjusting for inflation) when presented as lost income per family of four. This is not a postage stamp per day.
The CBO study, on the other hand, does not even attempt a comprehensive measure of lost income and it explicitly states so in footnote 3 of its report.[3] In addition, the CBO study assumes that government expenditure of one dollar is the same as not taxing that dollar. Finally, the CBO created an artificial year (2020 in terms of a 2010 economy), which allows it to project a lower tax cost in the first place because the baseline in 2010 is lower than the baseline in 2020. The CBO's methodology effectively measures the administration costs of collecting and distributing the allowances rather than the full economic cost.
Analysts from across the ideological spectrum who estimate comprehensive measures of lost income due to Waxman-Markey find costs that are also measured in thousands of dollars per year. The Heritage estimate for lost GDP in 2020 is $161 billion, which translates to nearly $1,900 per family of four. The CRA International study (conducted for the National Black Chamber of Commerce) and a Brookings Institution study both project costs that translate to about $5,000 per family of four.[4]
[1]Environmental Protection Agency, "EPA Analysis of the American Clean Energy and Security Act of 2009 H.R. 2454 in the 111th Congress," June 23, 2009, at http://www.epa.gov/climatechange/economics/pdfs/HR2454
_Analysis.pdf (July 25, 2009), and Congressional Budget Office, "The Estimated Costs to Households from the Cap-and-Trade Provisions of H.R. 2454," June 19, 2009, at http://www.cbo.gov/ftpdocs/103xx/doc10327
/06-19-CapAndTradeCosts.pdf (July 25, 2009).
[2]EPA, p. 13.
[3]CBO, p. 4.
[4]David Montgomery et al., "Impact on the Economy of the American Clean Energy and Security Act of 2009 (H.R.2454)," CRA International, May 2009, at http://www.nationalbcc.org/images/stories/documents/
CRA_Waxman-Markey_%205-20-09_v8.pdf (July 25, 2009), and Warwick McKibbin, Pete Wilcoxen, and Adele Morris, "Consequences of Cap and Trade," Brookings Institution, June 8, 2009, at http://www.brookings.edu
/~/media/Files/events/2009/0608_climate_change_economy/20090608
_climate_change_economy.pdf (July 25, 2009).
Conclusion
The Waxman-Markey bill proposes a new national tax of historic proportions. Though levied directly on carbon-based energy, the tax's impact spreads through the economy, increasing prices, reducing income, destroying jobs, and significantly expanding the national debt.
As with many policies coming from Washington these days, the Waxman-Markey bill seeks to "level the playing field" by making a more competitive player weaker, in this case hamstringing carbon-based energy sources, rather than ensuring an environment where less competitive players can become stronger. This policy hurts everyone, including alternative-energy investors, because it uses resources less efficiently, which creates deadweight losses. This means there will be underused resources leading to fewer opportunities in the future as slower growth reduces the resources available to help power the research and development investments that will create the technologies of the future.
As President Obama said about his cap-and-trade program during the presidential election campaign, "electricity prices would necessarily skyrocket."[12] The same applies to many other prices as the Waxman-Markey energy tax spreads through the economy. Businesses and consumers will adapt as well as possible to these higher prices. They will spend more for less energy. They will build smaller houses and buildings. They will drive smaller, less safe vehicles. They will turn thermostats up in the summer and down in the winter. They will divert income to more expensive energy-saving appliances. But these activities and more will not be enough to offset the higher energy costs. The net effect is lower income, higher prices, and fewer jobs.
In particular, the Heritage analysis projects that by 2035:
Gasoline prices will rise 58 percent (or $1.38) above the baseline forecast, which already contains price increases;
Natural gas prices will rise 55 percent;
Heating oil prices will rise 56 percent;
Electricity prices will rise 90 percent;
A family of four can expect to pay $1,241 more for energy costs per year;
Including taxes, a family of four will pay $4,609 more per year;
A family of four will reduce its consumption of goods and services by up to $3,000 per year, as its income and savings fall;
Aggregate GDP losses will be $9.4 trillion;
Job losses will be nearly 2.5 million; and
The national debt will rise an additional $12,803 per person.
(All figures are in constant 2009 dollars.)
All of these costs will be paid for no more than a 0.2 degree (Celsius) moderation in world temperature increases by 2100, and no more than a 0.05 degree reduction by 2050. Saddling the next generation with higher prices, higher debt, less income, fewer jobs, and more taxes does not seem like a worthy legacy--especially when the purported environmental benefits are so small they can barely be measured.
David W. Kreutzer, Ph.D., is Senior Policy Analyst for Energy Economics and Climate Change in the Center for Data Analysis; Karen A. Campbell, Ph.D., is Policy Analyst in Macroeconomics in the Center for Data Analysis; William W. Beach is Director of the Center for Data Analysis; Ben Lieberman is Senior Policy Analyst in Energy and the Environment in the Thomas A. Roe Institute for Economic Policy Studies; and Nicolas D. Loris is a Research Assistant in the Thomas A. Roe Institute for Economic Policy Studies, at The Heritage Foundation.
Appendix 1: Methodological Appendix
IHS/Global Insight Long-Term U.S. Macroeconomic Model
The IHS/Global Insight long-term U.S. macroeconomic model is a large-scale 30-year (120-quarter) macroeconometric model of the U.S. economy. It is used primarily for commercial forecasting.
Over the years, analysts at The Heritage Foundation's Center for Data Analysis (CDA) have worked with economists at Global Insight (GI) to adapt the GI model to policy analysis. CDA analysts use the GI model to evaluate the effects of policy changes not only on disposable income and consumption in the short run, but also on the economy's long-run supply-side potential. They can do so because the GI model imposes the long-run structure of a neoclassical growth model but makes short-run fluctuations in aggregate demand a focus of analysis.
The Global Insight model can be used to forecast more than 1,400 macroeconomic aggregates. Those aggregates describe final demand, aggregate supply, incomes, industry production, interest rates, and financial flows in the U.S. economy. The GI model includes such a wealth of information about the effects of important changes in the economic and policy environment because it encompasses detailed modeling of consumer spending, residen tial and non-residential investment, government spending, personal and corporate incomes, federal (and state and local) tax revenues, trade flows, financial markets, inflation, and potential gross domestic product.
Consistent with the rational-expectations hypothesis, economic decision-making in the GI model is generally forward-looking. In some cases, Global Insight assumes that expectations are largely a function of past experience and recent changes in the economy. Such a retroactive approach is taken in the model because GI believes that expectations change little in advance of actual changes in the economic and policy variables about which economic decision makers form expectations.
Operation of the U.S. Macroeconomic Model
The policy changes contained in Waxman-Markey and simulated in the U.S. energy model (as described in the paper) resulted in changes in the U.S. macroeconomic model of energy-price variables, energy use and demand variables, and government revenue and spending variables. The changes predicted by the energy model were introduced into the macro model in order to simulate the overall economic impact of the Waxman-Markey bill. In order to mitigate differences in scale and baseline assumptions between the energy model variables and the corresponding macroeconomic variables, the percentage changes in variables predicted by the energy model, rather than the new value, were imposed on their macroeconomic variable counterparts. These changes were implemented in the following ways:
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Energy Price Effects. The macro model contains a host of prices that are changed through their interaction with other variables in this model. The policy changes in Waxman-Markey affect the prices that consumers pay for energy and the prices that producers in the energy sectors pay for their inputs directly. The direct microeconomic impact of the legislation is thus simulated by the microeconomic model of the energy sector. (The energy model is described in the main text.) The direct micro effect is then used to change the macro model in order to simulate the net economic effect on the macro economy induced by the far-reaching ripple effects of the microeconomic changes to the energy sector.
Price changes simulated by the energy model for the producer prices were used to adjust the corresponding variables in the macro model. The prices that energy-sector producers pay were then made exogenous; thus these prices were driven by the energy-model simulation. The following producer-price categories were affected: coal, natural gas, electricity, natural gas, petroleum products, and residual fuel oil.
CDA analysts employed a similar procedure in implementing changes in consumer prices. In this case, the variables affected were all consumption-price deflators. Once again, we substituted changes predicted by the energy-model simulation for these variables for their macro-model counterparts. The following consumption price deflators were affected: fuel oil and coal, gasoline, electricity, and natural gas.
Unlike in the Lieberman-Warner climate-change bill, the energy model simulation of Waxman-Markey did not predict changes for major macroeconomic cost drivers: West Texas Intermediate Crude Spot Price, Refiners' Average Cost of Crude Oil (domestic and imported), Henry Hub Spot Price, and Natural Gas Wellhead Price. These prices are largely affected by the imported price of crude oil. Instead, the Waxman-Markey legislation influences market prices further down the domestic production line where emissions constraints are binding.
Energy Consumption Effects. In theory, higher energy prices could be driven by increased energy demand. Thus, CDA analysts adjusted the macroeconomic model to account for decreases in the demand for carbon-based fuels. The changes that were made for the variables total energy consumption, total end-use consumption for petroleum, total end-use consumption for natural gas, total end-use consumption for coal, and total end-use consumption for electricity were again obtained from the energy model simulation.
Both the energy model and the macro model contain equations that predict changes in demand for energy, given changes in energy prices, but the energy model contains a more detailed treatment of demand. Preferring details over generality, CDA analysts lined up the demand equations in both models and substituted settings from the energy model for those in the macro model. Specifically, analysts lined up these demand equations:
Total energy consumption,
Total end-use consumption for petroleum,
Total end-use consumption for natural gas,
Total end-use consumption for coal, and
Total end-use consumption for electricity.
In addition to the consumption price effects, overall spending is influenced by changes in fuel efficiency. The energy model predicts changes in fuel efficiency and changes in total highway fuel consumption. The macro model variables for average miles per gallon of new light vehicles and the average miles per gallon of the light vehicle stock were changed according to the change predicted by the energy model. The highway consumption of fuel was adjusted by an average of the change simulated in the energy model of highway consumption of fuel by cars and light trucks.
Renewable Energy Production. The energy model predicted changes in renewable sources. These energy supplies would affect market prices for energy, albeit the macro model does not have an explicit price deflator for renewable energy. The effect of domestic renewable sources of energy would also influence the amount of oil imported. The macro model adjusts differences between supply and demand in energy by affecting imports through a residual variable that is exogenous in the model. This means that the model would not account for substitutions in supply andwould incorrectly increase imports by the decrease in traditional sources of domestic energy. Thus this residual value was changed in the macro model according to the changes estimated by the energy model for the new level of imports, domestic production (both renewable and nonrenewable), and domestic consumption. This allowed the macroeconomic simulation to implicitly take account of the increase in alternative fuel source supply.
Revenue Estimates. The energy model produces estimates of carbon emissions and of the carbon fee in dollars per metric ton. By multiplying the emissions by the carbon fee, analysts obtained the "revenue" from the emissions permits.
Heritage analysts assumed that the revenue value of permits equals the entire value of these permits as government revenue, regardless of whether they are formally auctioned. If the government chooses to transfer ownership of the permits to other entities, that would be reflected as a transfer payment in the national income accounts. The allocation of the value of this revenue is a source of much debate among the legislators. Heritage analysts allocated the revenue as much as possible, given the sparse detail in the memo "Proposed Allowance Allocation" by Chairman Henry A. Waxman and Chairman Edward J. Markey dated May 14, 2009. Any unallocated allowance revenue remained in the federal government's general consumption variable and was thus allocated by the model in ways consistent with the historical pattern of government spending.
Specifically, the allowance value was transferred to individuals in the form of non-Medicare or Social Security full-employment transfers (as opposed to an aid transfer driven by an economic downturn like an unemployment benefit transfer). The various transfers specified in the memo amounted to 15.5 percent of the value transferred until 2021, and 16 percent of the value transferred to individuals thereafter.
Revenues allocated to state and local governments were more complicated. These were: 11.5 percent in 2012 to 2015; 9 percent in 2016 to 2017; 8 percent in 2018 to 2021; 6.5 percent in 2022 to 2025; 6 percent in 2026; 5.75 percent in 2027; 5.5 percent in 2028; 5.25 percent in 2029; and 5 percent in 2030 to 2035.
The state and local transfers were then allocated as transfers of aid to individuals in the amount of 1.5 percent of state funds through 2030. The remaining allowance value that was given to states and not transferred to individuals was put in the state and local general consumption variable and allocated by the macro model according to the historical pattern used for these funds. (At the state and local levels these historical uses are largely additional transfers to individuals.)
The macro model would have deficit-financed this increased spending rather than recognize the value as being generated by the allowances purchased (explicitly or implicitly) in the private sector. The variable for federal government tax receipts on production and imports other than from a value-added tax was increased by the value of the allowances to account for the increased revenue generation. This allowed the macro model to more accurately forecast the likely debt burden, interest rate effects, and so on, as well as the tax burden on the private sector by this transfer to government.
Monetary Policy. The monetary policy variable in the macro model was turned on, dictating that monetary policy would be adjusted according to a Taylor-type rule over the forecast horizon. The Taylor rule adjusts the federal funds rate in an effort to keep inflation low and minimize any gap between potential GDP and real GDP. This reaction helps to mitigate the harmful economic and inflationary effects of the legislation.
Appendix 2: Key Economic Indicators
Table 2-1
Table 2-2
Table 2-3
Appendix 3 State Results
Table 3-1
[1]Scientific questions about global warming, its causes, and the seriousness of the consequences are not discussed in this report.
[2]The November 2008 baseline is used for this analysis. Heritage analysts relied on models maintained by IHS Global Insight, Inc., for developing the economic estimates reported in this paper. The IHS Global Insight model is used by private-sector and government economists to estimate how changes in the economy and public policy are likely to affect major economic indicators. The methodologies, assumptions, conclusions, and opinions presented here are entirely the work of analysts at The Heritage Foundation's Center for Data Analysis. They have not been endorsed by, and do not necessarily reflect the views of, the owners of the IHS Global Insight model.
[3]Note, even if allowances are not purchased explicitly, but given freely, the producer is now holding an allowance that could be sold and thus carries an opportunity cost. That is, the driver of the cost increases is not the cash payment of allowances, but the constraint on emissions. Contrary to popular belief, giving allowances for "free" does not mitigate this cost.
[4]The final legislation passed by the House called for slightly different allocations. While softening the impact for some groups at the expense of others matters for those affected groups, the macroeconomic impact of this rearrangement is not significantly changed. Again, the main driver of the economic impact is the artificial scarcity of emissions that constrains energy production and consumption. Without adequate energy levels, the economy slows down and resources are underused.
[5]For a full description and technical details of the simulation see Appendix 1.
[6]Heritage analysts relied on models maintained by IHS Global Insight, Inc., for developing the economic estimates reported in this paper. The IHS Global Insight model is used by private-sector and government economists to estimate how changes in the economy and public policy are likely to affect major economic indicators. The methodologies, assumptions, conclusions, and opinions presented here are entirely the work of analysts at The Heritage Foundation's Center for Data Analysis. They have not been endorsed by, and do not necessarily reflect the views of, the owners of the IHS Global Insight model.
[7]This incentive is policy-induced and is not driven by the real fundamental incentive of relative costs to relative benefits. Therefore, artificially increasing the price of carbon-based fuel in order to make alternative fuels more competitive is less efficient. It handicaps a competitive energy source so that a less competitive source has a chance, rather than making the less competitive source more competitive. Arguments that this is creating greater efficiency for clean energy are correct, but they miss the point that relative to the baseline, the economy is being forced to pay more for the same amount of energy or receive less of it, which means there is an overall negative impact on the economy.
[8]For detailed results of the simulation, see Appendix 2.
[9]For detailed state results of the simulation, see Appendix 3.
[10] For a discussion of why the allowances can be considered taxes, see "Congressional Budget Office Cost Estimate: H.R. 2454, American Clean Energy and Security Act of 2009," June 5, 2009, at http://www.cbo.gov/ftpdocs/102xx/doc10262/hr2454.pdf (July 25, 2009).
[11]For example, between 2005 and 2006 CO2 emissions decreased by 1.3 percent, while the U.S. economy grew by 3.3 percent. Only 0.9 percent of the decrease was due to a decrease in overall energy use during this time, which indicates that the U.S. economy is becoming less carbon-intensive even without more mandates. Margo Thorning, "The Impact of America's Climate Security Act of 2007 (S. 2191) on the U.S. Economy and on Global Greenhouse Gas Emissions," testimony before the Committee on Environmental and Public Works, U.S. Senate, November 8, 2007, at http://www.accf.org/pdf/test
-climate-security.pdf (July 28, 2009).
[12]"Obama: My Plan Makes Electricity Rates Skyrocket," YouTube, January 17, 2008, at http://www.youtube.com/watch?v=HlTxGHn4sH4 (July 25, 2009).
http://www.heritage.org/Research/EnergyandEnvironment/cda0904.cfm
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Lawmakers' Global-Warming Trip Hit Tourist Hot Spots
Penguins, a Rocket-Propelled Airplane (and Tax Dollars) Also Involved
By BRODY MULLINS and T.W. FARNAM
WASHINGTON -- When 10 members of Congress wanted to study climate change, they did more than just dip their toes into the subject: They went diving and snorkeling at the Great Barrier Reef. They also rode a cable car through the Australian rain forest, visited a penguin rookery and flew to the South Pole.
The 11-day trip -- with six spouses traveling along as well -- took place over New Year's 2008. Details are only now coming to light as part of a Wall Street Journal analysis piecing together the specifics of the excursion.
It's tough to calculate the travel bills racked up by members of Congress, but one thing's for sure: They use a lot of airplanes. In recent days, House of Representatives members allocated $550 million to upgrade the fleet of luxury Air Force jets used for trips like these -- even though the Defense Department says it doesn't need all the planes.
The South Pole trip, led by Rep. Brian Baird (D., Wash.), ranks among the priciest. The lawmakers reported a cost to taxpayers of $103,000.
That figure, however, doesn't include the actual flying, because the trip used the Air Force planes, not commercial carriers. Flight costs would lift the total tab to more than $500,000, based on Defense Department figures for aircraft per-hour operating costs.
Lawmakers say the trip offered them a valuable chance to learn about global warming and to monitor how federal funds are spent. "The trip we made was more valuable than 100 hearings," said Rep. Baird, its leader. "Are there members of Congress who take trips somewhat recreationally? Perhaps. Is this what this trip was about? Absolutely not."
The knowledge gained is "profoundly important to how I do this job," added Mr. Baird, who at the time headed the House Science Committee's subcommittee on research and science education.
Other legislators agree it wasn't all fun and games. "There are a lot more glamorous things to do than hang out on the South Pole," said Rep. Frank Lucas, an Oklahoma Republican who traveled as well. "I never want to wear that many clothes again."
Taxpayer-funded travel for Congress is booming. Legislators and aides reported spending about $13 million on overseas trips last year, a Journal analysis has shown, a nearly 10-fold jump since 1995.
For Mr. Baird, the trip was one of two such excursions in six months. Last summer, he went to the Galapagos Islands with several lawmakers, also to gain expertise in climate change.
Other lawmakers have taken big-ticket trips. In June 2007, Ted Stevens, then a Republican senator from Alaska, and four other senators went to the Paris Air Show, costing the government $121,000 for hotels, meals and other expenses. Information needed to estimate their flight costs wasn't available.
Mr. Stevens said the purpose was to learn more about developments in aviation. "My state is very dependent on the industry" because many cities can be reached only by air, he said.
The 10 members of Congress gathered at Andrews Air Force Base in Maryland on the morning of Dec. 29, 2007, along with several of their staff. Those who brought spouses were four Democrats (Rep. Mike Ross of Arkansas, Rep. Russ Carnahan of Missouri, Rep. Charlie Melancon of Louisiana and Rep. John Tanner of Tennessee) and two Republicans (Rep. Randy Neugebauer of Texas and Mr. Lucas of Oklahoma). Spouses must pay for their own meals, but they don't have to pay for lodging and travel.
Asked about his wife's participation, Mr. Lucas cited a busy congressional schedule that often keeps families separated, even on weekends. If spouses couldn't go along on trips abroad, "then you couldn't travel -- simple as that," he said.
A spokeswoman for Mr. Melancon said the representative's wife of 37 years, Peachy Melancon, added "insight and perspective" that "only amplified the educational benefit he gained as a lawmaker."
Representatives for the other four who brought spouses declined to comment on doing so. Lawmakers said the trip offered them a valuable chance to learn about global warming and to monitor how federal funds are spent on scientific projects.
The party boarded a C-40, the military's business-class version of a Boeing 737. It is designed to be an "office in the sky" for government leaders, according to the Air Force Web site.
The lawmakers touched down at their first destination, Christchurch, New Zealand, a few hours before sunset on New Year's Eve. Mr. Baird watched the town's fireworks at midnight, his spokesman said.
The next day, Jan. 1, 2008, preparing for their South Pole trip, the lawmakers were provided clothing for extreme cold weather, including thermal underwear, according to the National Science Foundation.
Only lawmakers and staff were allowed to visit Antarctica; spouses stayed in New Zealand. The government doesn't pay for spouses' accommodations when the lawmakers aren't present.
On Jan. 2, the lawmakers and four aides flew to McMurdo Station in Antarctica on a supply flight, about 800 miles from the South Pole. "Take your camera to dinner," the itinerary reminded the travelers, for a post-meal tour of Discovery Hut, an outpost that was the launching pad for early South Pole expeditions.
The next day, the group left for the South Pole itself aboard a C-130 Hercules making a previously scheduled supply run. The aircraft was specially equipped with takeoff-boosting rockets and also skis for use on ice runways. The lawmakers toured the South Pole Station, including its post office. "Pre-address and pre-stamp any mail you wish to send from the South Pole," the itinerary reminded them. Scientists briefed them on research projects including a $271 million telescope buried in the ice that detects elementary particles passing through the Earth.
After flying back to McMurdo, they visited a penguin rookery to see the "threats to the wildlife," said a spokeswoman for the National Science Foundation.
They also spoke with National Aeronautics and Space Administration scientists there who hope to use the South Pole's frigid and hostile environment to test inflatable moon dwellings. "Some of the most important science in the world is being done down there," Mr. Baird said.
Next stop: Australia. The group took a boat trip to the Great Barrier Reef, where lawmakers spoke with scientists about research showing its vulnerability to climate change, according to the Science Committee's report.
Mr. Baird, a certified scuba diver, said he went on two shallow reef dives with scientists. Rep. Loretta Sanchez, a California Democrat, said she preferred to snorkel. Mr. Lucas said he didn't enjoy the boat trip because he hasn't spent much time on the water. The reef is one of the world's premier diving destinations.
Later, Mr. Baird made a third reef dive at his own expense to see first-hand the damage to coral reefs caused by tourism. Mr. Baird said he wanted to see evidence of coral bleaching, which some scientists say is caused by higher levels of carbon dioxide in the atmosphere. Mr. Baird blames increased carbon levels for a decline of shellfish in the Pacific Ocean near his district.
The tab for two days in Australia was more than $50,000, according to the travel-disclosure form. According to the document, the lawmakers spent $32,000 on hotels and meals, $7,000 on transportation and $10,000 for "other purposes." As on all such oversees trips, each lawmaker gets a daily stipend of $350 for incidentals, according to the form.
Mr. Baird said the travel report for Australia was inaccurate. His spokesman didn't respond to requests for details.
The trip ended with a layover in Hawaii to refuel the Air Force plane. There, lawmakers visited troops based at Hickman Air Force Base.
On the last night of their 11-day trip, the lawmakers stayed at the Royal Hawaiian Hotel in Waikiki. The spokesman for Mr. Baird said he would have been "every bit as happy camping as staying in a hotel."
Write to Brody Mullins at brody.mullins@wsj.com and T.W. Farnam at timothy.farnam@wsj.com
http://online.wsj.com/article/SB124967502810515267.html
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Window Pain
Ashlea Ebeling, 08.24.09, 12:00 AM ET
Congress has a deal for you: Buy energy-efficient windows and get $1,500 knocked off your 2009 or 2010 federal tax bill via a credit included in last February's $787 billion stimulus. The catch? The windows that qualify for the credit might not be the most energy efficient.
This absurdity results from two bad congressional habits: micromanaging everything through the tax code and cutting last minute deals on 1,000-page bills. The deal involved coming up with a creative way to chop $2.4 billion from the $4.3 billion cost of a rational credit, one keyed to the Department of Energy's "Energy Star" certification. But rather than cut the size or dollar maximum for the new credit--it's equal to 30% of your first $5,000 in window spending--Congress adopted a new, tougher standard, so fewer windows would qualify.
The problem? Energy Star standards vary by region. Congress, in its wisdom, overrode them with one national standard in which windows are rated on both their ability to keep heat in and their ability to keep sunshine out. That works fine for, say, the mid-Atlantic, where about the same amount of energy is used for summer cooling and winter heating. But in colder climes the sun's heat is needed for warmth--meaning New Englanders will have to pump up their thermostat if they want a tax-credit window that does a good job at keeping the sun out. In warm states residents don't need windows that excel at trapping heat. "You don't want the same window in the far South and the far North," says Lowell Ungar, director of policy with the Alliance to Save Energy.
At least this stimulus has created a job: The Window & Door Manufacturers Association hired its first full-time Washington lobbyist, who is now pushing Congress to go back to standards that vary by region.
http://www.forbes.com/forbes/2009/0824/outfront-tax-credit-energy-star-window-pain.html?partner=contextstory
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The high speed rail boondoggle
Rick Moran
The Obama administration, failing to learn the lessons of nearly 40 years of subsidizing Amtrak, is embarking on a huge high speed rail project that promises to spend tens of billions of dollars for meager benefits.
As Robert Samuelson points out in his Washington Post column, we have been subsidizing about 78,000 Amtrak users to the tune of about $50 per ride. The results? A negligible decrease in traffic congestion, and greenhouse gas emissions.
Ah! But high speed rail will be different says Obama/Biden:
The White House promises fabulous benefits. High-speed rail "will loosen the congestion suffocating our highways and skyways," says Vice President Biden. A high-speed rail system would eliminate carbon dioxide emissions "equal to removing 1 million cars from our roads," adds the president. Relieve congestion. Fight global warming. Reduce oil imports. The vision is seductive. The audience is willing. Many Americans love trains and regard other countries' systems (say, Spain's rapid trains between Madrid and Barcelona, running at about 150 mph) as evidence of U.S. technological inferiority.
There's only one catch: The vision is a mirage. The costs of high-speed rail would be huge, and the public benefits meager.
Samuelson looks at the astronomical costs of high speed rail:
President Obama's network may never be built. It's doubtful private investors will advance the money, and once government officials acknowledge the full costs, they'll retreat. In a recent report, the Government Accountability Office cited a range of construction costs, from $22 million a mile to $132 million a mile. Harvard economist Edward Glaeser figures $50 million a mile might be a plausible average. A 250-mile system would cost $12.5 billion and 10 systems, $125 billion.
That would be only the beginning. Ticket prices would surely be subsidized; otherwise, no one would ride the trains. Would all the subsidies be justified by public benefits -- less congestion, fewer highway accidents, lower greenhouse gases?
Obviously not, says Samuelson.
The Obama administration has already proposed spending $13 billion on high speed rail - $8 billion in the stimulus bill and another billion a year through 2013. As more money is poured down this black hole and costs skyrocket, the old gambit of "We've spent this much, might as well spend the rest" takes over and the entire, costly boondoggle gets built.
The prospect of subsidizing both Amtrak and this high speed rail system boggles the mind. For less than .002% of the commuting public, we will spend billions.
At least Joe Biden will get to ride his choo-choo real fast. Maybe the engineer will let him blow the horn.
Hat Tip: Ed Lasky
Page Printed from: http://www.americanthinker.com/blog/2009/08/the_high_speed_rail_boondoggle.html at August 24, 2009 - 10:37:09 AM EDT
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Deep oil: a giant discovery
Thomas Lifson
BP has announced a "giant" oil discovery in the Gulf of Mexico, drilled to a total depth of 35,055 feet. Drilling began at a depth of 4,132 feet below the surface of the water. No further details of the magnitude of the discovery are being released. But this is further evidence that deep oil and gas deposits may dwarf the resources discovered at shallower depths.
More than two decades ago, people began noticing that shallower wells in the Gulf of Mexico that were thought to be exhausted seemed to be regenerating, with oil seeping upward from deposits below. This observation, as well as the discovery of vast gas deposits at depths of 10,000 feet and more, has led to a theory that oil and gas deposits are not the fossilized remains of organic matter from the ancient surface of the earth, but are instead a product of organic processes at work underneath the surface of the planet.
The technology for drilling deep is improving, thanks to the work of geniuses in Houston and other locales. It still costs a lot to reach miles beneath the earth's surface. But with this much money at stake, and with the enticement of huge quantities of oil available, further progress in capability and cost can be expected.
Theorists who proclaim that oil production has peaked or soon will decline have got to hate this good news for oil consumers.
Page Printed from: http://www.americanthinker.com/blog/2009/09/deep_oil_a_giant_discovery.html at September 02, 2009 - 03:55:21 PM EDT
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Spain's Solar-Power Collapse Dims Subsidy Model
By ANGEL GONZALEZ and KEITH JOHNSON
Spain's hopes of becoming a world leader in solar power have collapsed since the Spanish government slammed the brakes on generous subsidies.
The sudden change has rippled across the global solar industry, in a warning of the problems that government-supported renewable-energy programs can encounter.
In 2008, Spain accounted for half the world's new solar-power installations in terms of wattage, thanks to government subsidies to promote clean energy. But late last year, as the global economic crisis worsened, the government dramatically scaled back those subsidies and capped the amount of subsidized solar power that could be installed.
Factories world-wide that had ramped up production of solar-power components found that demand for solar panels was plummeting, leaving a glut in supply and pushing prices down. Job cuts followed.
"The solar industry in 2009 has been undermined by [a] collapse in demand due to the decision by Spain," says Henning Wicht, a solar-power analyst at research group iSuppli.
Spain is providing important lessons for the U.S., where lawmakers are engaged in a debate about how to support renewable energy. Boosters of clean energy, including President Barack Obama, have pointed to Spain as a success story showing how government policies jump-started renewable energy, created new industries, and helped the environment.
Spain's early bet on wind power paid off: The country is one of the world leaders in generating such power, only recently eclipsed by the U.S. Spanish wind-power companies have become global players. In 2008, wind power accounted for 11% of Spanish electricity production, compared to less than 1% for solar power.
Reyad Fezzani, chief executive of BP Solar, a unit of oil giant BP PLC, said that despite the current crisis, the Spanish model succeeded in creating a solar industry from scratch. "Once you pay for the infrastructure, you have a skilled work force and you can expand and contract very easily," he said.
Clean-energy skeptics, however, point to Spain as a cautionary tale of a government policy that created a speculative bubble with disastrous consequences. Some Republicans have cited Spain's solar bubble and bust as an example of how unsustainable government clean-energy pushes are.
The U.S. is experimenting with different ways to promote clean energy, including tax incentives and direct federal subsidies to defray installation costs, and mandates for utilities to get a certain amount of their power from renewable energy.
California and New Jersey, which lead the U.S. in solar power, are among states that have used subsidies similar to the ones in Spain to make solar power more attractive. Two House Democrats, Jay Inslee of Washington and Bill Delahunt of Massachusetts, are drafting legislation that would create European-style tariffs for solar power.
The industry's fundamental problem is that, without subsidies, it's still not economically viable.
Mike Ahearn, chief executive of Tempe, Arizona-based First Solar Corp., says solar power could be competitive "within a couple of years" -- but only if the industry gains scale. That would require generous government subsidies and other forms of support, Mr. Ahearn says: "It's a chicken-and-egg problem."
Spain's solar ambitions started as an outgrowth of its earlier push to become a global player in wind power. By offering generous long-term support for wind power, Spain became a world leader. Companies such as Iberdrola SA and Gamesa Corp. catapulted from their home market to the U.S.
Wind energy was a cheaper renewable option than solar, so the Spanish government sought to make solar power more attractive by increasing subsidies, just as other countries, particularly Germany, were scaling back support.
As a result, Spain's solar capacity last year increased to 3,342 megawatts from 695 megawatts, the size of a coal plant, a year earlier. Government subsidies for solar power jumped to €1.1 billion ($1.6 billion) in 2008 from €214 million in 2007.
Solar power "was a financial product, not an energy solution," says Ignacio Sánchez Galán, chairman of Iberdrola, the world's biggest renewable-energy company. Iberdrola has largely shunned solar because wind power is cheaper and requires less land.
That's especially true of the new wave of large-scale solar power, known as solar thermal power, which uses the sun to heat water into steam which runs turbines. That technology offers the potential for much bigger clean-energy projects than silicon-coated photovoltaic panels, and has attracted interest from utilities in Spain and the U.S., especially. But solar thermal power is far from being cost-competitive with traditional power sources, and it requires large swathes of empty land, such as those found in parts of Spain and the U.S. Southwest.
Faced with the unraveling world economy and a deepening budget deficit, the Spanish government late last year reduced the money it paid for solar electricity and capped the amount of subsidized solar power installed each year at 500 megawatts. Spain's solar-power capacity has actually shrunk this year as a result.
The effects have been felt far beyond Spain. China's Yingli Green Energy Holding Co., which makes solar-power components for export, posted a 43% slide in first-quarter earnings, in large part because Spain was no longer buying.
Yiyu Wang, Yingli's chief strategic officer, said the Spanish experience could teach governments around the world to undertake "more practical, more stable plans."
Solar makers such as Norway's Renewable Energy Corp., China's LDK Solar Co. and JA Solar Holdings Co. posted big second-quarter losses. German giant Q-Cells posted a first-half net loss of €697 million and plans to cut about 500 workers, about a fifth of its work force.
"We are without a doubt in a difficult situation," Q-Cells CEO Anton Milner wrote in a report to shareholders.
Write to Angel Gonzalez at angel.gonzalez@dowjones.com and Keith Johnson at keith.johnson@wsj.com
Printed in The Wall Street Journal, page A4
http://online.wsj.com/article/SB125193815050081615.html?ru=yahoo&mod=yahoo_hs
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U.K. committee recommends rationed air travel
Government advisers in the U.K. are warning that air travel in the future may have to be rationed to meet target emissions levels. "We have to think seriously about constraining demand and the way we do that is to have high fares to reflect carbon prices," said David Kennedy, chief of the Committee on Climate Change, in a letter to government ministers. "You may want to go on holiday more that you do now. But you may not be able to do that in a carbon-constrained world," Kennedy said. Telegraph (London)
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SPPI’s Monthly CO2 Report is now posted:http://scienceandpublicpolicy.org/monthly_report/august_co2_report.html
(http://scienceandpublicpolicy.org/monthly_report/august_co2_report.html)
No heat buildup in the oceans = no global warming:
SPPI’s authoritative Monthly CO2 Report for August 2009 announces the publication of a major paper by Professors David Douglass and Robert Knox of the Physics Department in the University of Rochester, New York, demonstrating that the heat buildup in the oceans that is a necessary fingerprint of manmade global warming is not occurring. This is another mortal blow to the alarmist cause in the climate debate. Report, page 4.
“Science should be done by observation, meditation, calculation, and verification. Politicized science cannot usefully inform political decisions.” Editorial comment: Page 3.
The IPCC assumes CO2 concentration will reach 836 ppmv by 2100, but, for almost eight years, CO2 concentration has headed straight for only 570 ppmv by 2100. This alone halves all of the IPCC’s temperature projections. Pages 5-6.
Since 1980 temperature has risen at only 2.3 °F (1.4 °C)/century, not the 7 F° (3.9 C°) the IPCC predicts. Pages 7-9.
Sea level rose just 8 inches in the 20th century, and has scarcely risen since 2006. The oceans are not warming. Pages 10-11.
Arctic sea-ice extent is currently at its summer low, but there is more summer ice than there was in 2007 or 2008. In the Antarctic, sea ice extent reached a record high in 2007. Global sea ice extent shows little trend for 30 years. Pages 12-15.
Hurricane and tropical-cyclone activity is almost at its lowest since satellite measurement began. Pages 16-17.
The Sun is still very quiet. There were no sunspots in August at all. Page 18.
The (very few) benefits and the (very large) costs of the Waxman/Markey Bill are illustrated at Pages 19-21.
Science Focus this month reprints a paper giving the reasons why the great ice sheets will not collapse. Pages 22-28.
As always, there’s our “global warming” ready reckoner, and our monthly selection of scientific papers. Pages 29-34.
And finally, a Technical Note explains how we compile our state-of-the-art CO2 and temperature graphs. Page 35.
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Svensmark: “global warming stopped and a cooling is beginning” – “enjoy global warming while it lasts”
10 09 2009
This opinion piece from Professor Henrik Svensmark was published September 9th in the Danish newspaper Jyllands-Posten. Translation is from Google translation with some post translation cleanup of jumbled words or phrases by myself. In cases were the words were badly jumbled or didn’t quite make sense I inserted [my interpretation in brackets]. Hat tip to Carsten Arnholm of Norway for bringing this to my attention. – Anthony
Spotless Cueball: Catania observatory photosphere image August 31st, 2009
While the sun sleeps
HENRIK SVENSMARK, Professor, DTU, Copenhagen
Indeed, global warming stopped and a cooling is beginning. No climate model has predicted a cooling of the Earth, on the contrary. This means that projections of future climate is unpredictable, writes Henrik Svensmark.
The star which keeps us alive, has over the last few years almost no sunspots, which are the usual signs of the sun’s magnetic activity.
Last week, reported the scientific team behind Sohosatellitten (Solar and Heliospheric Observatory) that the number of sunspot-free days suggest that solar activity is heading towards its lowest level in about 100 years’. Everything indicates that the Sun is moving into a hibernation-like state, and the obvious question is whether it has any significance for us on Earth.
If you ask the International Panel on Climate Change IPCC, representing the current consensus on climate change, so the answer is a reassuring ‘nothing’. But history and recent research suggests that it is probably completely wrong. Let us take a closer look at why.
Solar activity has always varied. Around the year 1000, we had a period of very high solar activity, which coincided with the medieval warmth. It was a period when frosts in May was an almost unknown phenomenon and of great importance for a good harvest. Vikings settled in Greenland and explored the coast of North America. For example, China’s population doubled over this period. But after about 1300, the earth began to get colder and it was the beginning of the period we now call the Little Ice Age. In this cold period all the Viking settlements in Greenland disappeared. Swedes [were surprised to see Denmark to freeze over in ice], surprised the Danes by walking over the ice and the Thames in London froze repeatedly. But more serious was the long periods of crop failure, which resulted in a poorly nourished population, because of disease and hunger [population was reduced] by about 30 per cent in Europe.
It is important to note that the Little Ice Age was a global event. It ended in the late 19th century and was followed by an increase in solar activity. Over the past 50 years solar activity has been the highest since the medieval warmth for 1,000 years ago. And now it appears that the sun returns and is heading towards what is called ‘a grand minimum’ as we saw in the Little Ice Age.
The coincidence between solar activity and climate through the ages have tried explained away as coincidence. But it turns out that almost no matter what time studying, not just the last 1000 years, so there is a line. Solar activity has repeatedly over the past 10,000 years has fluctuated between high and low. Actually, the sun over the past 10,000 years spent in a sleep mode, approx. 17 pct of the time, with a cooling of the Earth to follow.
One can wonder that the international climate panel IPCC does not believe that the sun changed activity has no effect on the climate, but the reason is that they only include changes in solar radiation.
Just radiation would be the simplest way by which the sun could change the climate. A bit like turning up and down the brightness of a light bulb.
Satellite measurements of solar radiation has been shown that the variations are too small to cause climate change, but so has closed his eyes for a second much more powerful way the sun is able to affect Earth’s climate. In 1996 we discovered a surprising influence of the sun – its impact on Earth’s cloud cover. High energy accelerated particles of exploded stars, the cosmic radiation, are helping to form clouds.
When the Sun is active its magnetic field shields better against the cosmic rays from outer space before they reach our planet, and by regulating the Earth’s cloud cover the sun can turn up and down the temperature. High solar activity obtained fewer clouds and the earth is getting warmer. Low solar activity inferior shields against cosmic radiation, and it results in increased cloud cover and hence a cooling. As the sun’s magnetism has doubled its strength during the 20th century, this natural mechanism may be responsible for a large part of global warming during this period.
This also explains why most climate scientists are trying to ignore this possibility. It does in fact favor the idea that the 20th century temperature rise is mainly due to human emissions of CO2. If the sun as has influenced a significant part of warming in the 20 century, it means that CO2’s contribution must necessarily be smaller.
Ever since our theory was put forward in 1996, it has been through a very sharp criticism, which is normal in science.
First it was said that a link between clouds and solar activity could not be correct because no physical mechanism was known. But in 2006 after many years of work we managed to conduct experiments at DTU Space, where we demonstrated the existence of a physical mechanism. The cosmic radiation helps to form aerosols, which are the seeds for cloud formation.
Then came the criticism that the mechanism we have found in the laboratory was unable to survive in the real atmosphere and therefore had no practical significance. But the criticism we have just emphatically rejected. It turns out that the sun itself is doing, what we might call natural experiments. Giant solar flares can have the cosmic radiation on earth to dive suddenly over a few days. In the days after the eruption cloud cover falls by about 4 per cent. And the content of liquid water in clouds (droplets) is reduced by almost 7 per cent. Indeed, [you could say] that the clouds on Earth originated in space.
Therefore we have looked at the sun’s magnetic activity with increasing concern, since it began to wane in the mid-1990s.
That the sun could fall asleep in a deep minimum was suggested by [solar scientists] at a meeting in Kiruna in Sweden two years ago. As Nigel Calder and I updated our book “The Chilling Stars” therefore, we wrote a little provocative [passage] “we recommend our friends to enjoy global warming while it lasts.”
Indeed, global warming stopped and a cooling is beginning. Last week, it was argued by Mojib Latif from the University of Kiel at the UN World Climate Conference in Geneva that cooling may continue through the next 10 to 20 years.
His explanation was natural changes in North Atlantic circulation and not in solar activity. But no matter how it is interpreted, the natural variations in climate then penetrates more and more.
One consequence may be that the sun itself will show its importance for climate and thus to test the theories of global warming. No climate model has predicted a cooling of the Earth, on the contrary.
This means that projections of future climate is unpredictable. A forecast [that] says it may be warmer or colder for 50 years, is not very useful, for science is not able to predict solar activity.
So in many ways, we stand at a crossroads. The near future will be extremely interesting and I think it is important to recognize that nature is completely independent of what we humans think about it. Will Greenhouse theory survive a significant cooling of the Earth? Not in its current dominant form. Unfortunately, tomorrow’s climate challenges will be quite different than greenhouse theory’s predictions, and perhaps it becomes again popular to investigate the sun’s impact on climate.
Professor Henrik Svensmark is director of the Center for Sun-Climate Research at DTU Space. His book “The Chilling Stars” has also been published in Danish as “Climate and the Cosmos” (Gads Forlag, DK ISBN 9788712043508)
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second post of the morning
Solar wind surprise: “This discovery is like finding it got hotter when the sun went down,”
10 09 2009
This gives a whole new meaning to “Total Solar Irradiance”. Instead of TSI, perhaps we should call the energy transfer that comes from the sun to the earth TSE for “Total Solar Energy” so that it includes the solar wind, the geomagnetics, and other yet undiscovered linkages. Jack Eddy is smiling and holding up the patch cord he’s been given at last, wondering how long it will be before we find all the connectors.
Scientists discover surprise in Earth’s upper atmosphere
From the UCLA Newsroom: By Stuart Wolpert
UCLA atmospheric scientists have discovered a previously unknown basic mode of energy transfer from the solar wind to the Earth’s magnetosphere. The research, federally funded by the National Science Foundation, could improve the safety and reliability of spacecraft that operate in the upper atmosphere.
“It’s like something else is heating the atmosphere besides the sun. This discovery is like finding it got hotter when the sun went down,” said Larry Lyons, UCLA professor of atmospheric and oceanic sciences and a co-author of the research, which is in press in two companion papers in the Journal of Geophysical Research.
The sun, in addition to emitting radiation, emits a stream of ionized particles called the solar wind that affects the Earth and other planets in the solar system. The solar wind, which carries the particles from the sun’s magnetic field, known as the interplanetary magnetic field, takes about three or four days to reach the Earth. When the charged electrical particles approach the Earth, they carve out a highly magnetized region — the magnetosphere — which surrounds and protects the Earth.
Charged particles carry currents, which cause significant modifications in the Earth’s magnetosphere. This region is where communications spacecraft operate and where the energy releases in space known as substorms wreak havoc on satellites, power grids and communications systems.
The rate at which the solar wind transfers energy to the magnetosphere can vary widely, but what determines the rate of energy transfer is unclear.
“We thought it was known, but we came up with a major surprise,” said Lyons, who conducted the research with Heejeong Kim, an assistant researcher in the UCLA Department of Atmospheric and Oceanic Sciences, and other colleagues.
“This is where everything gets started,” Lyons said. “Any important variations in the magnetosphere occur because there is a transfer of energy from the solar wind to the particles in the magnetosphere. The first critical step is to understand how the energy gets transferred from the solar wind to the magnetosphere.”
The interplanetary magnetic field fluctuates greatly in magnitude and direction.
Heejeong Kim and Larry Lyons
“We all have thought for our entire careers — I learned it as a graduate student — that this energy transfer rate is primarily controlled by the direction of the interplanetary magnetic field,” Lyons said. “The closer to southward-pointing the magnetic field is, the stronger the energy transfer rate is, and the stronger the magnetic field is in that direction. If it is both southward and big, the energy transfer rate is even bigger.”
However, Lyons, Kim and their colleagues analyzed radar data that measure the strength of the interaction by measuring flows in the ionosphere, the part of Earth’s upper atmosphere ionized by solar radiation. The results surprised them.
“Any space physicist, including me, would have said a year ago there could not be substorms when the interplanetary magnetic field was staying northward, but that’s wrong,” Lyons said. “Generally, it’s correct, but when you have a fluctuating interplanetary magnetic field, you can have substorms going off once per hour.
“Heejeong used detailed statistical analysis to prove this phenomenon is real. Convection in the magnetosphere and ionosphere can be strongly driven by these fluctuations, independent of the direction of the interplanetary magnetic field.”
Convection describes the transfer of heat, or thermal energy, from one location to another through the movement of fluids such as liquids, gases or slow-flowing solids.
“The energy of the particles and the fields in the magnetosphere can vary by large amounts. It can be 10 times higher or 10 times lower from day to day, even from half-hour to half-hour. These are huge variations in particle intensities, magnetic field strength and electric field strength,” Lyons said.
The magnetosphere was discovered in 1957. By the late 1960s, it had become accepted among scientists that the energy transfer rate was controlled predominantly by the interplanetary magnetic field.
Lyons and Kim were planning to study something unrelated when they made the discovery.
“We were looking to do something else, when we saw life is not the way we expected it to be,” Lyons said. “The most exciting discoveries in science sometimes just drop in your lap. In our field, this finding is pretty earth-shaking. It’s an entire new mode of energy transfer, which is step one. The next step is to understand how it works. It must be a completely different process.”
The National Science Foundation has funded ground-based radars which send off radio waves that reflect off the ionosphere, allowing scientists to measure the speed at which the ions in the ionosphere are moving.
The radar stations are based in Greenland and Alaska. The NSF recently built the Poker Flat Research Range north of Fairbanks.
“The National Science Foundation’s radars have enabled us to make this discovery,” Lyons said. “We could not have done this without them.”
The direction of the interplanetary magnetic field is important, Lyons said. Is it going in the same direction as the magnetic field going through the Earth? Does the interplanetary magnetic field connect with the Earth’s magnetic field?
“We thought there could not be strong convection and that the energy necessary for a substorm could not develop unless the interplanetary magnetic field is southward,” Lyons said. “I’ve said it and taught it. Now I have to say, ‘But when you have these fluctuations, which is not a rare occurrence, you can have substorms going off once an hour.’”
Lyons and Kim used the radar measurements to study the strength of the interaction between the solar wind and the Earth’s magnetosphere.
One of their papers addresses convection and its affect on substorms to show it is a global phenomenon.
“When the interplanetary magnetic field is pointing northward, there is not much happening, but when the interplanetary magnetic field is southward, the flow speeds in the polar regions of the ionosphere are strong. You see much stronger convection. That is what we expect,” Lyons said. “We looked carefully at the data, and said, ‘Wait a minute! There are times when the field is northward and there are strong flows in the dayside polar ionosphere.’”
The dayside has the most direct contact with the solar wind.
“It’s not supposed to happen that way,” Lyons said. “We want to understand why that is.”
“Heejeong separated the data into when the solar wind was fluctuating a lot and when it was fluctuating a little,” he added. “When the interplanetary magnetic field fluctuations are low, she saw the pattern everyone knows, but when she analyzed the pattern when the interplanetary magnetic field was fluctuating strongly, that pattern completely disappeared. Instead, the strength of the flows depended on the strength of the fluctuations.
“So rather than the picture of the connection between the magnetic field of the sun and the Earth controlling the transfer of energy by the solar wind to the Earth’s magnetosphere, something else is happening that is equally interesting. The next question is discovering what that is. We have some ideas of what that may be, which we will test.”
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Energy 'Sprawl' and the Green Economy
We're about to destroy the environment in the name of saving it
Text .By LAMAR ALEXANDER
Secretary of the Interior Ken Salazar recently announced plans to cover 1,000 square miles of land in Nevada, Arizona, California, Colorado, New Mexico and Utah with solar collectors to generate electricity. He's also talking about generating 20% of our electricity from wind. This would require building about 186,000 50-story wind turbines that would cover an area the size of West Virginia not to mention 19,000 new miles of high-voltage transmission lines.
Is the federal government showing any concern about this massive intrusion into the natural landscape? Not at all. I fear we are going to destroy the environment in the name of saving the environment.
The House of Representatives has passed climate legislation that started out as an attempt to reduce carbon emissions. It has morphed into an engine for raising revenues by selling carbon dioxide emission allowances and promoting "renewable" energy.
The bill requires electric utilities to get 20% of their power mostly from wind and solar by 2020. These renewable energy sources are receiving huge subsidies all to supposedly create jobs and hurry us down the road to an America running on wind and sunshine described in President Barack Obama's Inaugural Address.
Yet all this assumes renewable energy is a free lunch a benign, "sustainable" way of running the country with minimal impact on the environment. That assumption experienced a rude awakening on Aug. 26, when The Nature Conservancy published a paper titled "Energy Sprawl or Energy Efficiency: Climate Policy Impacts on Natural Habitat for the United States of America." The report by this venerable environmental organization posed a simple question: How much land is required for the different energy sources that power the country? The answers deserve far greater public attention.
By far nuclear energy is the least land-intensive; it requires only one square mile to produce one million megawatt-hours per year, enough electricity for about 90,000 homes. Geothermal energy, which taps the natural heat of the earth, requires three square miles. The most landscape-consuming are biofuels ethanol and biodiesel which require up to 500 square miles to produce the same amount of energy.
Coal, on the other hand, requires four square miles, mainly for mining and extraction. Solar thermal heating a fluid with large arrays of mirrors and using it to power a turbine takes six. Natural gas needs eight and petroleum needs 18. Wind farms require over 30 square miles.
This "sprawl" has been missing from our energy discussions. In my home state of Tennessee, we just celebrated the 75th Anniversary of the Great Smoky Mountains National Park. Yet there are serious proposals by energy developers to cover mountains all along the Appalachian chain, from Maine to Georgia, with 50-story wind turbines because the wind blows strongest across mountaintops.
Let's put this into perspective: We could line 300 miles of mountaintops from Chattanooga, Tenn., to Bristol, Va., with wind turbines and still produce only one-quarter the electricity we get from one reactor on one square mile at the Tennessee Valley Authority's Watts Bar Nuclear Plant.
The 1,000 square-mile solar project proposed by Mr. Salazar would generate, on a continuous basis, 35,000 megawatts of electricity. You could get the same output from 30 new nuclear reactors that would fit comfortably onto existing nuclear sites. And this doesn't count the thousands of miles of transmission lines that will be needed to carry the newly generated solar power to population centers.
There's one more consideration. Solar collectors must be washed down once a month or they collect too much dirt to be effective. They also need to be cooled by water. Where amid the desert and scrub land will we find all that water? No wonder the Wildlife Conservancy and other environmentalists are already opposing solar projects on Western lands.
Renewable energy is not a free lunch. It is an unprecedented assault on the American landscape. Before we find ourselves engulfed in energy sprawl, it's imperative we take a closer look at nuclear power.
Mr. Alexander is a Republican senator from Tennessee and a member of the Senate Environment and Public Works Committee.
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http://www.reason.com/news/show/136265.html
Alaskan Oil Abundance Versus Washington's Wasted Billions
The case for new oil drilling in Alaska and off America's coasts
Jon Basil Utley | September 22, 2009
Oil imports now count for almost 80 percent of American consumption and cost some $300 to $400 billion yearly. They wreck our trade balance, subsidize many of our enemies, and add to our already mountainous foreign debt.
For political reasons, Venezuela, Nigeria, and Mexico—all major sources of U.S. oil imports—have suffered precipitous declines in production, with scant hope of recovering soon. Russian oil production is limited by government incompetence and lack of re-investment. Iraq's vast oil potential is paralyzed by political strife. At any moment, Iran might be attacked by Israel or America which would shut down its production. Further, Iran has threatened to retaliate against any attack by blockading the narrow passage in the Arabian Gulf through which most Saudi Arabian and Kuwaiti oil flows.
Analysts are already forecasting 100-dollar-a-barrel oil within a year. Yet the Obama administration is still blocking offshore drilling in America—even though it was approved by Congress last year—and wants to raise taxes on oil companies. Several years are needed to get major new production on line, even without anticipated environmental lawsuits designed to stymie or at least harass and delay any drilling of new wells off of America's east and west coasts.
In Alaska, we have a pipeline which could flow another 1.5 million barrels per day—worth nearly $50 billion per year—from vast oil resources waiting to be drilled. Oil appears to be abundant all the way across Northern Alaska from the Canadian border, where British Petroleum (BP) spent a billion dollars for new Canadian leases, to the shallow Chukchi Sea near the border with Russia, where test drilling is planned for next year.
New oil drilling in Alaska and off America's coasts would create hundreds of thousands of American jobs and billions of dollars in real tax revenue for Washington. Compare that to government spending to create jobs, which costs some $200,000 per job. Furthermore, administration claims for alternative energy rarely mention the billions of dollars in subsidies, lost tax revenue, and new government debt they require.
For example, solar power involves billions of dollars in costly subsidies which add to the ballooning budget and trade deficits, as many of the panels are imported. A 30 percent tax credit comes right off an installer's income taxes. Giant companies such as Florida Power & Light, for example, now pay much lower income taxes mainly because of the credits.
Wind farms receive a 30 percent cash subsidy from the government in a program estimated to soon cost taxpayers some $10 billion, according to the Wall Street Journal. And billions more in government financing will still be needed to build transmission lines from out-of-the-way locations. Ethanol was similarly hyped by Washington—another gigantic political boondoggle with severely damaging consequences for food prices and tens of billions of dollars of wasted resources. Making gasoline economically from switch grass and other plants remains another pipe dream.
Major technological breakthroughs make vast new oil production possible—once Washington permits it. Natural gas is already abundant and promises to stay cheap into the foreseeable future (see my previous article at Reason.com, "The Coming Energy Abundance"). Many trucks, buses, and taxis could be easily converted to run on natural gas, costing less than a dollar a gallon for the energy equivalent of gasoline or diesel oil. According to USA Today, there exists tremendous potential for natural gas in auto and truck engines, which consume some 20 percent of all the fuel used on highways. Still, nothing compares to oil products for most transport needs. They are relatively safe, easy to store and divide up, and easy to transport.
For oil, extended reach drilling has made vast new production possible. BP is now drilling eight miles out from a manmade island off Alaska's shallow Arctic coastal plain. Artificial islands might even allow new wells to reach under the potentially vast ANWR oil fields from offshore, although less costly exploratory wells would first have to be drilled from sites on the ANWR preserve.
Horizontal drilling allows wells to reach out into oil reserves as never before and to produce far more oil from each field. Multiple extensions can also be drilled sideways out from a single vertical well. Until a few years ago all oil wells were vertical. For comparison, a traditional vertical well might expose 2 to 300 feet of reservoir rock. A new well using multiple horizontal sections can expose over 20,000 feet of reservoir rock, according to the BP's publication Arctic Energy. The process is called coiled tubing drilling. It is vastly increasing production and lowering costs.
The 800-mile-long Alyeska Pipeline from Northern Alaska is now flowing at 600,000 barrels per day-its original capacity was over 2 million. BP expects its new offshore island to produce at least 40,000 barrels per day while the new Alpine field of Conoco Phillips Company is already producing some 110,000 barrels per day. The companies are also working on producing some of the billions of barrels of unused heavy oil from Alaska's Prudhoe Bay, trying to develop technologies to mix it with lighter hydrocarbons so it can flow through the pipeline. These numbers give some idea of how the pipeline might again be filled to capacity, assuming that ANWR production is permitted by Washington.
Meanwhile, the Obama Administration is a prisoner of its "base," which includes extreme environmentalists doing all they can to delay and handicap new oil and gas drilling. If just a fraction of the $700 billion stimulus bill was spent on subsidizing natural gas fueling facilities at interstate truck stops, America could use more of its natural gas to avoid tens of billions of dollars of oil imports.
Moreover, none of the above addresses the new technology in nuclear electric power generation. Small, factory built reactors could be operational by 2018. They could supplement or replace costly giant plants which now take 10 years for approval and construction. Low cost energy abundance is again well possible for America.
Jon Basil Utley is associate publisher of The American Conservative. He was a foreign correspondent for Knight Ridder newspapers and former associate editor of The Times of the Americas. For 17 years, he was a commentator for the Voice of America. In the 1980s, he owned and operated a small oil drilling partnership in Pennsylvania.
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***scientific american
From the October 2009 Scientific American Magazine Another Century of Oil? Getting More from Current Reserves ( Preview )
Amid warnings of a possible "peak oil," advanced technologies offer ways to extract every last possible drop
By Leonardo Maugeri
Forecasts that global oil production will soon start to decline and that most oil will be gone within a few decades may be overly pessimistic. The author predicts that by 2030, thanks to advanced technologies, wells will be able to extract half of the oil known to be underground, up from the current average of 35 percent. Together with new discoveries, the increased productivity could make oil last at least another century. More from the Magazine
On fourteen dry, flat square miles of California’s Central Valley, more than 8,000 horsehead pumps—as old-fashioned oilmen call them—slowly rise and fall as they suck oil from underground. Glittering pipelines crossing the whole area suggest that the place is not merely a relic of the past. But even to an expert’s eyes, Kern River Oil Field betrays no hint of the technological miracles that have enabled it to survive decades of dire predictions.
When Kern River Oil Field was discovered in 1899, analysts thought that only 10 percent of its unusually viscous crude could be recovered. In 1942, after more than four decades of modest production, the field was estimated to still hold 54 million barrels of recoverable oil, a fraction of the 278 million barrels already recovered. “In the next 44 years, it produced not 54 [million barrels] but 736 million barrels, and it had another 970 million barrels remaining,” energy guru Morris Adelman noted in 1995. But even this estimate proved wrong. In November 2007 U.S. oil giant Chevron, by then the field’s operator, announced that cumulative production had reached two billion barrels. Today Kern River still puts out nearly 80,000 barrels per day, and the state of California estimates its remaining reserves to be about 627 million barrels. ***
I can't post the rest of the article but the author gives a compelling reason why we have far more oil available then present estimates.
We always find more than expected.
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The New Sputnik
THOMAS L. FRIEDMAN
Published: September 26, 2009
Most people would assume that 20 years from now when historians look back at 2008-09, they will conclude that the most important thing to happen in this period was the Great Recession. I’d hold off on that. If we can continue stumbling out of this economic crisis, I believe future historians may well conclude that the most important thing to happen in the last 18 months was that Red China decided to become Green China.
Yes, China’s leaders have decided to go green — out of necessity because too many of their people can’t breathe, can’t swim, can’t fish, can’t farm and can’t drink thanks to pollution from its coal- and oil-based manufacturing growth engine. And, therefore, unless China powers its development with cleaner energy systems, and more knowledge-intensive businesses without smokestacks, China will die of its own development.
What do we know about necessity? It is the mother of invention. And when China decides it has to go green out of necessity, watch out. You will not just be buying your toys from China. You will buy your next electric car, solar panels, batteries and energy-efficiency software from China.
I believe this Chinese decision to go green is the 21st-century equivalent of the Soviet Union’s 1957 launch of Sputnik — the world’s first Earth-orbiting satellite. That launch stunned us, convinced President Eisenhower that the U.S. was falling behind in missile technology and spurred America to make massive investments in science, education, infrastructure and networking — one eventual byproduct of which was the Internet.
Well, folks. Sputnik just went up again: China’s going clean-tech. The view of China in the U.S. Congress — that China is going to try to leapfrog us by out-polluting us — is out of date. It’s going to try to out-green us. Right now, China is focused on low-cost manufacturing of solar, wind and batteries and building the world’s biggest market for these products. It still badly lags U.S. innovation. But research will follow the market. America’s premier solar equipment maker, Applied Materials, is about to open the world’s largest privately funded solar research facility — in Xian, China.
“If they invest in 21st-century technologies and we invest in 20th-century technologies, they’ll win,” says David Sandalow, the assistant secretary of energy for policy. “If we both invest in 21st-century technologies, challenging each other, we all win.”
Unfortunately, we’re still not racing. It’s like Sputnik went up and we think it’s just a shooting star. Instead of a strategic response, too many of our politicians are still trapped in their own dumb-as-we-wanna-be bubble, where we’re always No. 1, and where the U.S. Chamber of Commerce, having sold its soul to the old coal and oil industries, uses its influence to prevent Congress from passing legislation to really spur renewables. Hat’s off to the courageous chairman of Pacific Gas and Electric, Peter Darbee, who last week announced that his huge California power company was quitting the chamber because of its “obstructionist tactics.” All shareholders in America should ask their C.E.O.’s why they still belong to the chamber.
China’s leaders, mostly engineers, wasted little time debating global warming. They know the Tibetan glaciers that feed their major rivers are melting. But they also know that even if climate change were a hoax, the demand for clean, renewable power is going to soar as we add an estimated 2.5 billion people to the planet by 2050, many of whom will want to live high-energy lifestyles. In that world, E.T. — or energy technology — will be as big as I.T., and China intends to be a big E.T. player.
“For the last three years, the U.S. has led the world in new wind generation,” said the ecologist Lester Brown, author of “Plan B 4.0.” “By the end of this year, China will bypass us on new wind generation so fast we won’t even see it go by.”
I met this week with Shi Zhengrong, the founder of Suntech, already the world’s largest manufacturer of solar panels. Shi recalled how, shortly after he started his company in Wuxi, nearby Lake Tai, China’s third-largest freshwater lake, choked to death from pollution.
“After this disaster,” explained Shi, “the party secretary of Wuxi city came to me and said, ‘I want to support you to grow this solar business into a $15 billion industry, so then we can shut down as many polluting and energy consuming companies in the region as soon as possible.’ He is one of a group of young Chinese leaders, very innovative and very revolutionary, on this issue. Something has changed. China realized it has no capacity to absorb all this waste. We have to grow without pollution.”
Of course, China will continue to grow with cheap, dirty coal, to arrest over-eager environmentalists and to strip African forests for wood and minerals. Have no doubt about that. But have no doubt either that, without declaring it, China is embarking on a new, parallel path of clean power deployment and innovation. It is the Sputnik of our day. We ignore it at our peril.
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This comes from the Heritage Foundation:
President Obama’s speech to the UN on climate change last Tuesday points to an interesting and fairly recent shift in the left’s environmentalist philosophy: the definition of “pollution” has changed. Even ten years ago, concerns for pollution centered around problems of smog, litter, and toxins in the air and water. However, such concerns for largely visible pollution have been trumped recently by a concern for invisible pollution which Obama claims is the most dangerous of all: “greenhouse gas pollution” and “carbon pollution.”
While most visitors to the state of Wyoming marvel at miles of sparsely populated natural beauty, rolling mountains, open spaces, and clean air and water, environmentalists do not praise Wyoming but censure the state for its heavy coal development. In fact, Jeremy Nichols of WildEarth Guardians disapprovingly called the state “ground zero for greenhouse emissions.”
Ironically, one of the cleanest and most beautiful states in the union is labeled by environmentalists as the most persistent offender of the environment.
Wyoming produces the most coal in the United States, even though many other states have much greater coal reserves: Montana, for instance, has a lot more coal reserves but Wyoming produces ten times more coal. Wyoming also produces three times more coal than West Virginia - the second highest coal producing state.
Wyoming happens to have one of the healthiest economies in the union, and much of this economic success is due the energy development industry. Although the economy fluctuates with energy markets, Wyoming’s unemployment rates are consistently low; in August it was 5.7% compared to the 9.5% of the country. Wyoming also enjoyed a budget surplus in 2003 and 2005 and it continues to do well, achieving a balanced budget in 2009.
Wyoming may be “ground zero for greenhouse emissions” yet it is a state that has managed to wed clean air and water with a healthy economy. In the wake of onerous cap and trade philosophies, which will severely tax oil and coal production, dramatically raise energy prices, serve a huge blow to the economy, and only cool the earth’s temperature by a fraction of a degree, Wyoming provides us with food for thought on how we can be environmentally clean and economically prosperous.
Katie Brown contributed to this post.
Boyo
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this just makes me say WTF:
John Kerry: ‘Cap-and-trade’ is out
September 28, 2009 Democrats are trying yet another name change in their quest to cripple the American economy with greenhouse gas regulations.
Sen. John Kerry announced last week that the Senate climate bill due out this week will be a “pollution reduction” bill not a “cap-and-trade” bill. According to E&E Daily, Kerry said,
“I don’t know what ‘cap and trade’ means. I don’t think the average American does. This is not a cap-and-trade bill, it’s a pollution reduction bill.”
So the Democrats have gone from “global warming” to “climate change” to “clean energy” because the public doesn’t buy what they’re selling. Now they’re jettisoning “cap-and-trade” hoping that some other name will stick to the wall.
While Democrats can call economically disastrous carbon caps whatever they want, they can’t buff the cap-and-trade turd or any other carbon cap regime into a public policy popsicle.
Hey John, why don’t you just call it the “Free Candy for Everybody Act of 2009″?
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Drill
Petroleum is a major part of America’s energy picture. Shall we get it here or abroad?
By Sarah Palin
Given that we’re spending billions of stimulus dollars to rebuild our highways, it makes sense to think about what we’ll be driving on them. For years to come, most of what we drive will be powered, at least in part, by diesel fuel or gasoline. To fuel that driving, we need access to oil. The less use we make of our own reserves, the more we will have to import, which leads to a number of harmful consequences. That means we need to drill here and drill now.
We rely on petroleum for much more than just powering our vehicles: It is essential in everything from jet fuel to petrochemicals, plastics to fertilizers, pesticides to pharmaceuticals. Ac cord ing to the Energy Information Ad min is tra tion, our total domestic petroleum consumption last year was 19.5 million barrels per day (bpd). Motor gasoline and diesel fuel accounted for less than 13 million bpd of that. Meanwhile, we produced only 4.95 million bpd of domestic crude. In other words, even if we ran all our vehicles on something else (which won’t happen anytime soon), we would still have to depend on imported oil. And we’ll continue that dependence until we develop our own oil resources to their fullest extent.
Those who oppose domestic drilling are motivated primarily by environmental considerations, but many of the countries we’re forced to import from have few if any environmental-protection laws, and those that do exist often go unenforced. In effect, American environmentalists are preventing responsible development here at home while supporting irresponsible development overseas.
My home state of Alaska shows how it’s possible to be both pro-environment and pro-resource-development. Alaskans would never support anything that endangered our pristine air, clean water, and abundant wildlife (which, among other things, provides many of us with our livelihood). The state’s government has made safeguarding resources a priority; when I was governor, for instance, we created a petroleum-systems-integrity office to monitor our oil and gas infrastructure for any potential environmental risks.
Alaska also shows how oil drilling is thoroughly compatible with energy conservation and renewable-energy development. Over 20 percent of Alas ka’s electricity currently comes from renewable sources, and as governor I put forward a long-term plan to increase that figure to 50 percent by 2025. Alaska’s comprehensive plan identifies renewable options across the state that can help rural villages transition away from expensive diesel-generated electricity — allowing each community to choose the solution that best fits its needs. That’s important in any energy plan: Tempting as they may be to central planners, top-down, one-size-fits-all solutions are recipes for failure.
For the same reason, the federal government shouldn’t push a single, uni versal approach to alternative-powered vehicles. Electric cars might work in Los Angeles, but they don’t work in Alaska, where you can drive hundreds of miles without seeing many people, let alone many electrical sockets. And while electric and hybrid cars have their advantages, producing the electricity to power them still requires an energy source. For the sake of the environment, that energy should be generated from the cleanest source available.
Natural gas is one promising clean alternative. It contains fewer pollutants than other fossil fuels, it’s easier to collect and process, and it is found throughout our country. In Alaska, we’re developing the largest private-sector energy project in history — a 3,000-mile, $40 billion pipeline to transport hundreds of trillions of cubic feet of natural gas to markets across the United States. Onshore and offshore na tural gas from Alaska and the Lower 48 can satisfy a large part of our energy needs for decades, bringing us closer to energy independence. Whether we use it to power natural-gas cars or to run natural-gas power plants that charge electric cars — or ideally for both — natural gas can act as a clean “bridge fuel” to a future when more renewable sources are available.
In addition to drilling, we need to build new refineries. America currently has roughly 150 refineries, down from over 300 in the 1970s. Due mainly to environmental regulations, we haven’t built a major new refinery since 1976, though our oil consumption has increased significantly since then. That’s no way to secure our energy supply. The post-Katrina jump in gas prices proved that we can’t leave ourselves at the mercy of a hurricane that knocks a few refineries out of commission.
Building an energy-independent Amer ica will mean a real economic stimulus. It will mean American jobs that can never be shipped overseas. Think about how much of our trade deficit is fueled by the oil we import — sometimes as much as half of the total. Through this massive transfer of wealth, we lose hundreds of billions of dollars a year that could be invested in our economy. Instead it goes to foreign countries, including some repressive regimes that use it to fund activities that threaten our security.
Reliance on foreign sources of energy weakens America. When a riot breaks out in an OPEC nation, or a developing country talks about nationalizing its oil industry, or a petro-dictator threatens to cut off exports, the probability is great that the price of oil will shoot up. Even in friendly nations, business and financial decisions made for local reasons can de stabilize America’s energy market, since the price we pay for foreign oil is subject to rising and falling exchange rates. Decreasing our dependence on foreign sources of energy will reduce the impact of world events on our economy.
In the end, energy independence is not just about the environment or the economy. It’s about freedom and confidence. It’s about building a more secure and peaceful America, an America in which our energy needs will not be subject to the whims of nature, currency speculators, or madmen in possession of vast oil reserves.
Alternative sources of energy are part of the answer, but only part. There’s no getting around the fact that we still need to “drill, baby, drill!” And if those in D.C. say otherwise, we need to tell them: “Yes, we can!”
— Sarah Palin was governor of Alaska from 2006 to 2009, and the Republican candidate for vice president in 2008. This article appears in the November 2, 2009, issue of National Review.
National Review Online - http://article.nationalreview.com/?q=Nzc2ZjhjY2MwMWUyM2M4NTM5YWRjYTcwMTEzZTNjMTc=
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Wouldn't it be amusing if our current, misguided energy policy left us on top of huge reserves we could charge high prices for down the line?
U.S. Tops in Energy Resources
by Human Events (more by this author)
Posted 11/02/2009 ET
Updated 11/02/2009 ET
The United States has largest energy reserves on Earth, according to a report from the Congressional Research Service.
As shown in the charts below, the U.S. has 1,321 billion barrels of oil (or barrels of oil equivalent for other sources of energy) when combining its recoverable natural gas, oil and coal reserves.
While Russia is a close second with 1,248 billion barrels, other energy producing nations are far behind. No. 3 is Saudi Arabia (543 billion barrels), followed by China (494 billion barrels), Iran (426 billion barrels) and Canada (221 billion barrels.)
"Our overwhelming coal, natural gas, and oil resources represent tens of trillions of dollars in wealth and millions of American jobs,” said Sen. James Inhofe (R.-Ok.), who, along with Sen. Lisa Murkowski (R.-Alaska), released the report last week. “Whether through decree or purposeful inaction, government policies that unnecessarily restrict or prevent our ability to responsibly produce these domestic resources are threatening, and could eventually undermine, our nation's economic and national security. We should pursue an all-of-the-above strategy that advances new energy technologies but also prioritizes developing the resources we have today."
The report also noted that the United States has 28% of all the world’s coal reserves, with Russia again coming in second with 19%.
In addition, the report stated that the United States has tapped into only 13% or 21 billion barrels of its oil reserves, with the other 87% still untouched.
The following charts show the true picture of America’s energy reserves:
(http://www.humanevents.com/images/page3one.jpg)
(http://www.humanevents.com/images/page3two.jpg)
(http://www.humanevents.com/images/page3three.jpg)
http://www.humanevents.com/article.php?id=34233
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BBG: "Wouldn't it be amusing if our current, misguided energy policy left us on top of huge reserves we could charge high prices for down the line?"
Very possible. Ironic is the fact that the forbidden cheap energy around us is one of the forces preventing the move to the next solution (that will save the planet). Artificial regulations force prices up but people can still see the low hanging fruit. Why would people freely pay 15X for solar when clean coal is abundant, for example.
When the easy to access oil gets used up and the easy to access natural gas starts getting depleted, then market innovations of necessity will happen - if you believe in all that freedom and capitalism nonsense that made us the wealthiest civilization in history.
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I sent BBG's article to my Geoligist friend and here is his responce.
This is a little misleading.
The U.S. rules in coal, we have more coal than anyone, we are the middle east of coal. That is the bulk of “largest energy reserves on earth”.
When they say tapped into 13% of oil reserves, in actuality we have tapped into 99.9% of oil reserves and managed to extract 13%. The majority stays in the reservoirs and is really hard to get out. We have to develop more expensive secondary recovery methods to get it, and no one wants to spend the money to do it, when we can chug along at 13% (typically 20-30% extraction is really good).
Until prices for barrels get higher and higher, there isn’t an incentive to improve extraction methods, it’ll happen eventually though.
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(According to a radio spoof) we really need to focus our government programs for renewable energy on areas with the best potential for large scale returns: sun, wind, perpetual motion and personal methane reclamation systems.
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November 11, 2009
A Lesson in Biofuels from Tennessee
By Jeffrey Folks
In 2007, to great fanfare and amid ever-greater expectations, a large-scale demonstration project was initiated to turn switchgrass into biofuel. For an investment of $70 million, the taxpayers of the state of Tennessee were promised a lucrative new industry that would benefit farmers and create thousands of other "green jobs." The project, which was expected to produce five million gallons of biofuel from switchgrass within two years, would soon be fiscally self-sustaining and afford a "significant return" on investment. As the largest switchgrass demonstration project in the country, it was to have been the foundation for a whole new industry.
Sounds great, and it is just what the Tennessee legislature approved in 2007. When it began, "the University of Tennessee Biofuels Initiative," as it is called, excited favorable comments in newspapers and media across the country. Finally, there would be a practical alternative to those nasty fossil fuels, and the great thing was that it would be produced from a hearty plant that could be grown on marginal land almost anywhere. Switchgrass was the answer to America's dependence on foreign oil. It would restore the trade balance, boost the economy, and save the earth, all at the same time.
Now, according to the Knoxville News Sentinel, the Biofuels Initiative has reported that it is not yet producing 5 million gallons of switchgrass fuel. In fact, according to published reports, it would seem that it is not producing any fuel at all. The 250,000 gallons of ethanol that it is producing have been distilled from corn cobs -- a process akin to one already quite common, if not notorious, in the state of Tennessee.
According to figures from the U.S. Department of Energy, a biofuels facility of the sort envisioned would not be feasible unless it produced five million gallons per year. But according to a report by the executive director of the Fiscal Review Committee of the Tennessee state legislature, it appears certain that the Biofuels Initiative will not be "self-sufficient," as promised, within five years. Having initially promised that the plant would produce five million gallons with the goal of demonstrating the feasibility of switchgrass, the project director now seems to regard the initiative as a "research project." The feasibility issue will have to wait until some time in the future.
The project has cost the state $55 million, not counting additional federal funding and state subsidies to farmers growing switchgrass. Now members of the legislature are quoted as saying that the project is "not good stewardship of taxpayer dollars" and that continued funding "may need re-evaluation." The director of the project insists that the State Building Commission approved changes, but it appears that the legislature at large was not aware of them. Whether the legislature will continue funding the Biofuels Initiative, and at what level, will be determined after November 15.
Altogether, more than $90 million has been spent on the University of Tennessee Biofuels Initiative with no end in sight. On the national scale, tens of billions of dollars are being spent on similar alternative energy subsidies and research with little to show for it.
Much of this funding goes directly to foreign manufacturers. As reported in the Wall Street Journal, "China has positioned itself to reap many of the benefits" by exporting wind-turbines, solar panels, and other alternative energy products. The CEO of A-Power Energy Generation Systems, one of China's largest wind-turbine companies, has stated that the U.S. "is an ideal target" for exporting Chinese-made alternative energy goods.
Meanwhile, the Obama administration seems determined to kill off as many jobs as possible in well-established energy businesses here in the United States. The administration has placed a moratorium on mountaintop coal mining, affecting jobs throughout Appalachia. Interior Secretary Ken Salazar has delayed shale exploration in the western United States and reneged on promises to permit offshore drilling in Alaska and along the Atlantic and Pacific coasts.
At a time when Chinese and other foreign oil companies are buying up leases in the Gulf of Mexico, Obama is making it harder for our own energy companies to explore through the threat of cap-and-trade legislation. Domestic drilling for natural gas now stands at half of what it was just last year. The world's big new discoveries of oil and gas are taking place outside the U.S., offshore in Brazil and West Africa. Foreign countries will reap the economic reward of this exploration and production. Meanwhile, the value of U.S. currency continues to decline, and unemployment has risen to 10.2%.
How many energy-sector jobs has this administration killed off? Estimates are that new oil and gas discoveries in Brazil will create 400,000 new jobs (real jobs, not the "created or saved" variety). Even in the midst of a global recession, the Brazilian economy has shown resilience, perhaps because they are not busy eradicating jobs in their own energy sector. America could have a booming economy once again, with full employment and expanding wealth, but everything the President has done is designed to cripple our own industries and drive jobs overseas.
On one score, however, we can give the president credit. He has taken the initiative in driving CO2 emissions down, a step that some scientists believe will reduce global warming. The problem is that the earth is not warming: according the U. N.'s Intergovernmental Panel on Climate Change, the global temperature is now cooling, and it has been cooling for nearly a decade.
Obama has already budgeted tens of billions to combat climate change, a figure dwarfed by the amount proposed under cap-and-trade. The problem is, why cripple the economy to combat temperatures that are not rising? Obama seems to be in the same camp as the director of the Biofuels Initiative, who believes that switchgrass research will pay off some time in the future. Although it cannot be demonstrated now, at some time in the future the earth's temperatures are going to rise, and then we'll be glad we killed off America's fossil fuel industries. By that time, a lot of Americans will be without jobs, and whatever jobs they have won't be worth much.
But just think how happy the earth will be. Somewhere in the remote Arctic wilderness, a migratory caribou, grazing above five billion barrels of domestic oil reserves, will pause and thank us. After a few weeks it will pack up and head south for the long arctic winter, where it will reside comfortably while the unfortunate humans huddled in America will struggle to buy food, heat their homes, and make a living wage.
At that point, that $90 million spent on switchgrass research, and all of the other funds squandered on alternative energy research, would certainly come in handy, but it will be too late. China will be sitting pretty atop the world's largest fossil fuel reserves. Americans will be sitting around hoping the wind keeps blowing.
Dr. Jeffrey Folks taught for thirty years in universities in Europe, America, and Japan.
Page Printed from: http://www.americanthinker.com/2009/11/a_lesson_in_biofuels_from_tenn.html at November 11, 2009 - 11:31:19 AM EST
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Who Needs the Grid?
A new fuel-cell technology promises to revolutionize access to cheap, clean energy.
by Lane Wallace
IN THE BOARDROOM at Bloom Energy, a single picture hangs on the wall: a satellite image of the world at night. Clusters of bright lights mark the industrial centers, and thin white lines trace connecting passageways such as the U.S. Interstate System and the Trans-Siberian Railroad. In between, huge swaths lie in shadow.
Standing almost reverently before the image, K. R. Sridhar, the CEO of Bloom, points to the dark areas—places where electricity isn’t accessible or reliable. “This is my motivation for everything,” he says. To improve the lot of the more than 2 billion people living in those dark areas, he says, you have to get them reliable, affordable energy. And if you don’t want to doom the environment in the process, you have to make that energy very clean.
Impossible? No more so than creating enough water and oxygen to keep astronauts alive on Mars. And Sridhar’s already figured out how to do that. In fact, his research on oxygen generators for NASA laid the technical groundwork for his current venture: highly efficient solid-oxide fuel cells that run on everything from plant waste to natural gas and provide electricity while emitting relatively little carbon dioxide.
Such technology might sound far-fetched, but the basic patent behind Sridhar’s cells, which he calls “Bloom boxes,” dates to 1899. Fuel cells—which facilitate a chemical reaction between oxygen and hydrogen or hydrocarbon fuel without burning anything—have been used aboardNASA vehicles and Navy submarines for years. The biggest challenge in adapting them for commercial use was making the technology reliable and affordable. That’s where Sridhar’sNASA background gave him a breakthrough advantage.
“To send anything to Mars is so expensive, you have to extract the most use possible out of it. Which means you have to change your underlying assumptions about everything,” he explains. “So with [the Bloom boxes], I did the same thing. I looked at each component and, for example, set a price point that it absolutely had to make.”
Nearly eight years and a reported $250 million in venture-capital investment later, Sridhar has a working product that’s been in field trials for the past two years and is about to go on the global market, at a price he says will be competitive with existing energy options. As for results: in an ongoing trial at the University of Tennessee, a five-kilowatt Bloom box (the size of a large coffee table and capable of powering a 5,000-square-foot house) has proved twice as efficient as a traditional gas-burning system and produced 60 percent fewer emissions.
Since the boxes are “fuel agnostic,” customers can run them on existing propane, natural gas, or ethanol sources. But they’ll also run on plant waste, or almost anything else containing hydrogen and carbon. And the eventual “killer app”? Processing wind- or solar-generated electricity with water to create storable oxygen and hydrogen, then reversing the process to generate electricity at night or in low-wind or cloudy conditions.
That alone gives the technology impressive potential.
“If you have clean, affordable energy, you can get clean air and clean water whenever you want,” Sridhar says. “You can make recycling affordable. You can turn latent local resources into marketable ones.”
But the truly disruptive aspect of Bloom’s fuel cells isn’t their clean, quiet, affordable efficiency. It’s their ability to operate independent of a power grid. That’s critical for developing countries, which lack infrastructure. It could also allow Bloom to revolutionize energy-generation in industrialized nations.
“I want to open up access to energy the way that PCs and the Web opened up access to information,” Sridhar says. “So people can live where they want, and still be connected, without someone telling them when they can do their laundry.” A distributed energy system would also be far less susceptible to attack or natural disaster.
Should the utility companies be worried? Possibly. As Sridhar points out, “The companies who saw their business as selling mainframe computers are gone.” Of course, the utilities could also do as IBM did, and adapt. “The human ability to innovate out of a jam is profound,” Sridhar says with a smile. “That’s why Darwin will always be right, and Malthus will always be wrong.”
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From the other George W.
****By George Will
http://www.JewishWorldReview.com | What city contributed most to the making of the modern world? The Paris of the Enlightenment and then of Napoleon, pioneer of mass armies and nationalist statism? London, seat of parliamentary democracy and center of finance? Or perhaps Titusville, Pa.
Oil seeping from the ground there was collected for medicinal purposes — until Edwin Drake drilled and 150 years ago (Aug. 27, 1859) found the basis of our world, 69 feet below the surface of Pennsylvania, which oil historian Daniel Yergin calls "the Saudi Arabia of 19th-century oil."
For many years, most oil was used for lighting and lubrication, and the amounts extracted were modest. Then in 1901, a new well named for an East Texas hillock, Spindletop, began gushing more per day than all other U.S. wells combined.
Since then, America has exhausted its hydrocarbon supplies. Repeatedly.
In 1914, the Bureau of Mines said that U.S. oil reserves would be exhausted by 1924. In 1939, the Interior Department said that the world had 13 years' worth of petroleum reserves. Then a global war was fought, and the postwar boom was fueled. In 1951 Interior reported that the world had . . . 13 years of reserves. In 1970, the world's proven oil reserves were an estimated 612 billion barrels. By 2006, more than 767 billion barrels had been pumped, and proven reserves were 1.2 trillion barrels. In 1977, scold in chief Jimmy Carter predicted that mankind "could use up all the proven reserves of oil in the entire world by the end of the next decade." Since then the world has consumed three times more oil than was then in the world's proven reserves.
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But surely now America can quickly wean itself from hydrocarbons, adopting alternative energies — wind, solar, nuclear? No.
Keith O. Rattie, chief executive of Questar, a natural gas and pipeline company, says that by 2050 there may be 10 billion people demanding energy — a daunting prospect, considering that of today's 6.2 billion people, nearly 2 billion "don't even have electricity — never flipped a light switch." Rattie says that energy demand will grow 30 to 50 percent in the next 20 years and there are no near-term alternatives to fossil fuels.
Today, wind and solar power combined are just one-sixth of 1 percent of American energy consumption. Nuclear? The United States and other rich nations endorse reducing world carbon emissions 80 percent by 2050. But Oliver Morton, a science writer, says that if nuclear is to supply even 10 percent of the necessary carbon-free energy, the world must build more than 50 large nuclear power plants a year. Currently five a year are being built. Rattie says that as part of "a worldwide building boom in coal-fired power plants," about 30 under construction in America "will burn about 70 million tons of coal a year."
Edward L. Morse, an energy official in Carter's State Department, writes in Foreign Affairs that the world's deep-water oil and gas reserves are significantly larger than was thought a decade ago, and high prices have spurred development of technologies — a drilling vessel can cost $1 billion — for extracting them. The costs of developing oil sands — Canada may contain more oil than Saudi Arabia — are declining, so projects that last year were not economic with the price of oil under $90 a barrel are now viable with oil at $79 a barrel.
Morse says new technologies are also speeding development of natural gas trapped in U.S. shale rock. The Marcellus Shale, which stretches from West Virginia through Pennsylvania and into New York, "may contain as much natural gas as the North Field in Qatar, the largest field ever discovered."
Rattie says that known U.S. reserves of natural gas, which are sure to become larger, exceed 100 years of supply at the current rate of consumption. BP recently announced a "giant" oil discovery beneath the Gulf of Mexico. Yergin, writing in Foreign Policy, says "careful examination of the world's resource base . . . indicates that the resource endowment of the planet is sufficient to keep up with demand for decades to come."
Such good news horrifies people who relish scarcity because it requires — or so they say — government to ration what is scarce and to generally boss people to mend their behavior: "This is the police!" Put down that incandescent bulb and step away from the lamp!"
Today, there is a name for the political doctrine that rejoices in scarcity of everything except government. The name is environmentalism.*****
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How Offshore Oil and Gas Production Benefits the Economy and the Environment
by Bruce Allen
Backgrounder #2341
Abstract: Conventional wisdom holds that offshore oil and gas production harms the surrounding environment. This blanket "wisdom" ignores the fact that the largest source of marine hydrocarbon pollution is offshore natural oil seepage. It also ignores the fact that offshore oil production has lowered the amount of oil released into the ocean by reducing natural oil seepage, especially in areas with active offshore oil seeps, such as California's Santa Barbara coast. This Heritage Foundation analysis cites studies, developments, and biological facts that demonstrate often-overlooked benefits of offshore oil and gas production.
The oceans surrounding the United States hold tremendous oil and natural gas potential, but much of that potential is not being realized. Nearly 85 percent of these waters -- the Atlantic, the Pacific, and the eastern Gulf of Mexico -- are off-limits to exploration and drilling. Government studies estimate that these restricted areas hold at least 19 billion barrels of oil -- nearly 30 years' worth of current imports from Saudi Arabia -- and oil estimates are known to increase as exploration occurs. The greatest untapped potential lies in the Pacific. Producing this oil would increase oil supplies, lower prices, and generate large tax revenues -- while creating thousands of jobs in the domestic energy industry.
Drilling restrictions in general are imposed due to environmental concerns, despite the fact that offshore environmental damage has been greatly reduced by technologies that minimize the risk of oil spills and other hazards to the environment. In fact, offshore oil production has lowered the amount of oil released into the ocean by reducing natural seepage of oil, especially in areas with active offshore oil seeps, such as California's Santa Barbara coast.
Natural hydrocarbon seeps have historically been used to locate the world's usable sources of oil and tar. Papers published by British Petroleum in the early 1990s[1] show that over 75 percent of the world's oil basins contain surface oil seeps. Most seeps emit small volumes of oil and gas that do not significantly deplete hydrocarbon reservoirs over the short term, but can add up to significant depletion of oil and gas over the longer term.
The knowledge that surface seepage has a direct link to subsurface oil and gas accumulations is not new and has been the impetus for many of the world's early major oil and gas discoveries by pioneers of oil production -- as far back as ancient China, and more recently the 1860s in Pennsylvania and the 1890s in Azerbaijan. Natural seeps were the impetus for early exploration of oil in Iran and Iraq in the early 1900s.
Natural hydrocarbon seeps continue to be an important indicator of economic oil and gas resources. The high cost of deep-water offshore oil and gas exploration has made the identification of hydrocarbon seeps an important consideration in oil-exploration risk-reduction methods.[2]
Natural Seeps: The Largest Source of U.S. Marine Hydrocarbon Pollution
Natural hydrocarbon seeps generally result from pressurized hydrocarbon reservoirs that force oil and gas up through fissures to the earth's surface either on land or the seabed floor where the hydrocarbons escape in the form of oil, tar, and methane-rich gases.
It is a widely overlooked fact that natural hydrocarbon seeps generally have a larger impact on the marine environment than do oil and gas exploration and production. According to the National Academy of Sciences, 63 percent of hydrocarbon pollution in U.S. waters stems from natural seeps, while only 1 percent is due to offshore drilling and extraction.[3] Geologists believe that over the course of millions of years, more oil has seeped naturally into the earth's environment than currently exists in all conventional oil reservoirs combined.
The Gulf of Mexico, for instance, is a major U.S. offshore oil and gas producing region where the environmental impact of natural hydrocarbon seepage appears to far exceed the environmental impact of accidental oil releases due to commercial extraction and transportation.[4]
Onshore hydrocarbon seeps are also pervasive in many areas of the world, and are a source of contamination for many streambeds and rivers. The Santa Susanna Mountains in California are estimated to contain 22,000 active oil seeps that are associated with significant streambed contamination.[5]
One of the most studied offshore oil and gas seep regions over the last 40 years is the Santa Barbara coast of California, which has the world's second most prolific oil seepage areas, extending for about 80 miles along the coastline.[6] The offshore Santa Barbara oil seepage zones result in about 70,000 barrels per year of oil and tar seepage into the Pacific, much of which washes up on California beaches.[7] Every four years, the amount of offshore Santa Barbara oil seepage exceeds the 240,000 barrels that spilled from the Exxon Valdez in 1989. By comparison, according to the U.S. Minerals and Management Service, the total amount of oil spilled in California coastal waters due to offshore oil production since 1970 has been less than 870 barrels.[8] Far more birds and wildlife have been killed in the last 40 years by California's offshore oil seepage than by all previous California offshore oil production spills combined, including the 1969 spill.[9]
Seeps are also one of the world's largest methane gas emission sources,[10] and are a major source of air pollution in Santa Barbara County.[11] These coastal California seeps release oil and tar that washes ashore along nearly half the coastline of California, with the highest concentrations in Santa Barbara County. In the winter, the Davidson current washes seep oil and tar ashore as far north as the beaches of Santa Cruz and San Francisco.[12]
The California Department of Fish Game often receives public calls reporting a possible oil spill on California central coast beaches, which is invariably determined to be natural seepage. The California Department of Fish Game requires that seep oil and tar collected on California beaches be treated as hazardous waste, the same as for industrial oil spills.
Offshore Production: Significant Reductions in Oil Pollution on California Beaches
One of the side affects of offshore oil production has been the reduction of oil and gas seepage due to decreases in subsea oil-reservoir pressure. Seep oil is chemically the same as commercially extracted oil, although the seep oil and tar have often undergone partial oxidation by the time they move into the water or onshore.
The seepage reductions due to offshore oil and gas extraction have, in some cases, resulted in significant reductions in natural oil and gas seep pollution over the last 40 years.[13]
There are also anecdotal observations and research indicating that oil production around the world is responsible for ongoing reductions in hydrocarbon seepage pollution.[14]
Ironically, the decreased oil and gas reservoir pressure due to ongoing "legacy" offshore oil and gas production (which continued even after the state-wide offshore moratorium was imposed) near the site of the famous 1969 Santa Barbara oil spill is resulting in reductions in California's coastal seepage pollution. California beaches have become significantly cleaner over the last 50 years due to offshore oil and gas production.
Modern slant and horizontal drilling is extending these benefits into seep zones located further into the ocean than the areas immediately surrounding existing offshore production platforms. Central and southern California beaches have been polluted by this natural seep oil for well over 100,000 years. A 22-year study of the offshore oil platform "Holly" off the Californian coast concluded that,"Oil production here has resulted in an unexpected benefit to the atmosphere and marine environment."[15]According to peer-reviewed University of California research, if offshore production were expanded in the seep zone areas studied, there would be further reductions in seepage pollution and the associated methane gas and ozone-forming reactive organic compounds (ROCs).[16]
Long-time Santa Barbara residents have also observed for the last 50 years that their beaches have seen significant reductions in seepage oil and tar beach pollution. The simple fact is that California offshore oil and gas production has been the reason why California's prolific natural oil and gas seepage pollution has been declining for decades. California beaches are becoming cleaner thanks to existing legacy offshore oil and gas production. Geologists believe these reductions in seepage pollution will last for thousands of years.
Offshore hydrocarbon seeps are also a naturally dynamic process. In addition to reduced seepage due to reservoir pressure reductions from commercial extraction, seeps can also become active in new areas due to earthquakes and other natural events. In 2007, an earthquake in New Zealand resulted in a new offshore seepage area that led to exploration activity to determine the underlying reservoir's production potential. This seep zone off the New Zealand coast had previously not been explored for the presence of economically recoverable hydrocarbons.[17]
In Santa Barbara, a 6.8 magnitude earthquake in 1925 resulted in a large spontaneous release of undersea reservoir oil off the coast that boiled up from the seafloor and inundated the coastline and beaches with extensive oil slicks.[18] The southern California 1971 Sylmar earthquake also resulted in new offshore seep areas observed in previously unrecorded areas.
In January 2005, an increase in natural seepage off the California coast resulted in oil slicks that covered more than 20 square miles. The increased seepage subsided over the following weeks.
Since Californian offshore production began in the late 1950s, far more wildlife has been killed (using bird death estimates as a surrogate) by California's offshore natural oil seeps than by all of California offshore oil production spills combined. It is an interesting artifact of the offshore oil debate that large numbers of bird deaths due to natural oil seepage garners no media attention, whereas small numbers of bird deaths due to a small oil spill causes extensive national attention and outrage by opponents of offshore oil production -- even in areas where offshore production has been consistently reducing pollution caused by natural seepage.
A new study estimates that oil seepage off the Santa Barbara coast from one seep area alone (Coal Oil Point) has resulted in current oil sediment deposits between 8 and 80 times the amount of oil released from the Exxon Valdez spill.[19]
There are also concerns about air pollution resulting from seepage. Gas emissions from hydrocarbon seeps are estimated to be one of the largest sources of methane released annually into the earth's atmosphere, and studies indicate that existing oil and gas production may be causing ongoing reductions in methane emissions worldwide.[20] Methane is a potent greenhouse gas. Natural offshore seep emissions are one of the largest sources of air pollution in Santa Barbara County.
Oil Seeps: Indicators of Oil and Gas Reserves
The presence of natural oil seeps has led to the discovery of some of the world's largest oil fields. The second-largest oil field ever discovered, the Cantarell "supergiant" field, was discovered after a fisherman, Rudesindo Cantarell, repeatedly complained to the Mexican national oil company PEMEX that his fishing nets were being covered with oil in the Gulf of Mexico. PEMEX had no oil operations in Mr. Cantarell's fishing area. The company investigated the source of the offshore oil and subsequently discovered an offshore oil field in 1976 which had produced more than 12 billion barrels of oil by 2007. Although being depleted rapidly, the Cantarell field is still one of Mexico's largest single sources of oil production.[21]
At current rates of oil seepage off the Santa Barbara coast, about 7 billion barrels of oil may already have seeped into the California coastal marine environment over the last 100,000 years. The lifespan of the Santa Barbara offshore oil seeps is estimated to exceed 400,000 years. Seven billion barrels of oil represents approximately 25 percent of all current U.S. oil reserves. Seven billion barrels of new Santa Barbara offshore oil production would supply all of California's current imported oil needs for the next 25 years.
National Offshore Energy Policy Should Consider Natural Oil and Gas Seepage
Natural oil and gas seeps are by far the largest sources of hydrocarbon pollution released into U.S. coastal waters and are a major source of offshore oil pollution and atmospheric methane emissions worldwide. Oil and gas seeps are also one of the most important indicators for locating recoverable hydrocarbon resources. California's central and south coast has seen significant environmental benefits from the reductions in coastal seepage pollution due to offshore oil and gas production. California's coastal environment would benefit from offshore oil and gas expansion in active seep areas that are currently off-limits in California waters, as well as in federal seep zone waters in the Santa Maria basin in the Outer Continental Shelf. Thus offshore oil and gas production represents both an effective means of addressing the problems of seepage pollution as well as an economic opportunity.
Continued research may also show that the long-term environmental benefits that coastal California has experienced due to offshore oil and gas extraction may be occurring in other regions as well -- albeit probably to a lesser degree.
The economic benefits from increased domestic hydrocarbon production are well known, but many erroneously assume they come at an environmental cost. In truth, there are opportunities, off Santa Barbara and elsewhere, to achieve substantial environmental benefits from drilling as a consequence of reduced seepage of oil and natural gas into the air and water. Expanded offshore oil and gas production can genuinely be a win-win proposition.
Bruce Allen is co-founder of SOS California, an environmental and energy non-profit based in Santa Barbara, California.
[1] R. H. Clarke and R.W. Cleverly, "Petroleum Seepage and Post-Accumulation Migration," Geological Society, London, Special Publications, Vol. 59 (1991), pp. 265-271.
[2]Donald F. Saunders and Martin J. Davidson, eds., Surface Geochemical Exploration for Petroleum, Collected Papers, Library Collection (1933-2006), DeGolyer Library, Southern Methodist University.
[3]National Academy of Sciences, "Oil in the Sea III," The National Academies, 2002, at http://books.nap.edu/html/oil_in_the_sea/reportbrief.pdf (October 15, 2009).
[4]Roger Sassen, Alexei. V. Milkov, and Harry H. Roberts, "Environmental Significance of Gas and Oil Seeps, Gulf of Mexico, Continental Slope," American Association of Petroleum Geologists, Conference Report, 2002.
[5]"Investigation and Risk Assessment of Significant Natural Seeps in Santa Paula Creek" (SSEP 2008-09), California Department of Fish and Game, 2008.
[6]"Decrease in Natural Marine Hydrocarbon Seepage Near Coal Oil Point, California, Associated with Offshore Oil Production," Geology, November 1999.
[7]Santa Barbara County, "Natural Oil Seeps and Oil Spills," March 8, 2002, at http://www.countyofsb.org/energy/information/seepspaper.asp#_ednref33 (October 15, 2009), and Santa Barbara County, "Natural Seep Project Summary," Planning and Development Department, Energy Division and U.S. Geological Survey, Western Coastal and Marine Geology Team, Menlo Park, CA, May 24, 2004, at http://www.countyofsb.org/energy/information/
naturalSeepProjectSummary.asp (October 15, 2009).
[8]U.S. Minerals Management Service, Pacific OCS Region, at http://www.mms.gov/omm/Pacific/offshore/oil-and-gasfaq.htm (November 10, 2009).
[9]Santa Barbara Wildlife Care Network, at http://www.sbwcn.org/edu/oiled.php (November 16, 2009).
[10]Martin Hovland, Alan G. Judd, and R. A. Burke, "The Global Flux of Methane from Shallow Submarine Sediments," Chemosphere, Vol. 26 (1993), pp. 559-578.
[11]"Factor Analysis of Hydrocarbon Species in the South-Central Coast Air Basin," Journal of Applied Meteorology, Vol. 30 (May 1991), pp. 733-743.
[12]"Families of Miocene Monterey Crude Oil, Seep, and Tarball Samples, Coastal California," American Association of Petroleum Geologists Bulletin Vol. 92, No. 9 (September 2008), pp. 1131-1152.
[13]"Decrease in Natural Marine Hydrocarbon Seepage Near Coal Oil Point, California," Geology,November 1999.
[14]"The World's Most Spectacular Marine Hydrocarbon Seeps," Journal of Geophysical Research, Vol. 104 (September 15, 1999), pp. 20, 703-720.
[15]"Decrease in Natural Marine Hydrocarbon Seepage near Coal Oil Point, California, Associated with Offshore Oil Production," Geology,November 1999.
[16]"The World's Most Spectacular Marine Hydrocarbon Seeps," Journal of Geophysical Research.
[17]Press release, "Tests Identify Oil In Great South Basin," New Zealand Ministry of Economic Development, March 12, 2007.
[18]"June 29, 1925 Santa Barbara 6.8 Magnitude Earthquake," Santa Barbara Daily News, July 4, 1925.
[19]Press release, "UCSB Scientists Document Fate of Huge Oil Slicks from Seeps at Coal Oil Point," University of California, Santa Barbara, May 13, 2009, at http://www.instadv.ucsb.edu/pa/display.aspx?pkey=2010 (October 16, 2009).
[20]"Decrease in Natural Marine Hydrocarbon Seepage Near Coal Oil Point, California, Associated with Offshore Oil Production," Geology,November 1999.
[21]L. Cruz and J. Sheridan, "Relative Contribution to Fluid Flow From Natural Fractures in the Cantarell Field, Mexico," Society of Petroleum Engineers, 2009.
http://www.heritage.org/Research/EnergyandEnvironment/bg2341.cfm
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Doug suggested we come up with a new contract with America. One of the promises I thought of is that Republicans promise to make America self sufficient when it comes to our energy needs. I did a search for this but all I pull up is lefitst rants about alternative energy like solar, wind etc, and/or biofuels.
I went to Newt's webite and he has a column for energy but he points out near the bottom is "we have to come up with an alternative to what the Democrats are offering now".
I don't see why we can't do all of it as well as using our own offshore reserves, nuclear, Canada shale etc. instead of shooting ourselves in the head like BO and the rest of the socialists (and the rest of the laughing world) want us to do.
In any case we need a showdown on energy policy to help knock the liberals out of power.
Probably most Americans would buy it if we can surmount the MSM propaganda machine.
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Thanks CCP, I like the way you are thinking. To me, it is not total energy independence that we need, but at the least we should be able to survive with what can be produced in partnership with a friendly Canada and stop enriching enemies and shipping crucial supplies through faraway, difficult to defend waters.
I was planning to post a plan from Victor Hanson in 'the way forward' and I still will, but here is his energy component:
VDH: "A can-do energy plan. Offer tax incentives for development of nuclear power. Promote exploitation of gas and oil reserves in, and off, the United States, as a way to transition over 20 years to next generation fuels without enriching our enemies or going broke in the process. I never understood why nuclear power for electricity and natural gas/hybrids for transportation—we could be nearly energy independent through both—were declared environmentally incorrect when dotting pristine fields, deserts, and mountain passes with ugly wind turbines, acres of solar panels, and miles of access roads was considered “green.” Does Obama really think that the truther Van Jones knows more about power production than the head of a natural gas or oil company, or the engineer of a nuclear power plant?"
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The answer of course is all of the above. We can keep expanding wind and solar and developing 'next generation fuels' but still need to power the economy in the meantime.
Hanson writes: "nuclear power for electricity and natural gas/hybrids for transportation".
I wrote similarly in the nuclear thread (8/11/09): "If we substitute nuclear for natural gas in electricity and American natural gas in place of foreign oil in transportation, besides solving the CO2 spiral we would also be sending fewer dollars sent to Chavez and the Mullahs. It would be good for the currency, simplify foreign policy and ease the cost of national defense."
Instead we dither.
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Plug in Hybrids can also help. I think we should take our standard approach to the issue, let a bunch of companies try different generation methods and may the best 3-5 companies win. That would mean a fair anount of deregulation and a certain acceptance of risk in a currently Regulate and Risk averse environment.
On you tube is a Green Power Science video poster. He uses Fresnel lenses and parabolic mirrors in conjunctio with Sterling Engines to generate power. If you have a plug in hybrid and one of these setups, you have a means of charging your car up anywhere there is a reasonalbe amount of sunlight. Northern states would not have the option, but maybe part of the solution is a "regional Generator of Choice" concept. Solar in the South West, Hydro in the PacNW, Wind in the Plains, and where there is a particular need for highly concentrated generation Nukes. NewEngland could probably build something to exploit those winter Nor'Easters too.
It just seems that something is standing in the way of letting people figure things out. Di big corporations have an institutionalized NIH rule? "If it was not invented here and we do not own the patent, we will not use it" sort of thing? Apparently corporate America just does not undestrand how rare edison was and cannot bring itself to pay liscensing fees.
Look at the Tesla sports car, lamborghini like performance, but the big auto guys are not all over it. What gives?
There are Solar and Wind generation tecnologies out there that can power large groups of homes, but new developments are not putting up these Sunflowers and Pinwheels. What is preventing this?
Independant dairy farners are already using their cattle manure for power generation with methane digesters. Why aren't municipal sewage facilities installing new equipment that can do this, instead of just adding a new "same old tank". What is preventing this?
There is so much stuff that can get the job done out there, but it feels like it is being blocked. Thinning out the energy grid into a distrubuted energy scheme would allow us to have at least localized power for when another Katrina blows thru.
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What often prevents these things is the cost. This includes the question of what to do when the sun doesn't shine or the wind doesn't blow-- electricity doesn't really "store" well, so a 24/7 system is needed.
Changing subjects:
WSJ
Follow the Money
Last year, ExxonMobil donated $7 million to a grab-bag of public policy institutes, including the Aspen Institute, the Asia Society and Transparency International. It also gave a combined $125,000 to the Heritage Institute and the National Center for Policy Analysis, two conservative think tanks that have offered dissenting views on what until recently was called—without irony—the climate change "consensus."
To read some of the press accounts of these gifts—amounting to about 0.00027% of Exxon's 2008 profits of $45 billion—you might think you'd hit upon the scandal of the age. But thanks to what now goes by the name of climategate, it turns out the real scandal lies elsewhere.
Climategate, as readers of these pages know, concerns some of the world's leading climate scientists working in tandem to block freedom of information requests, blackball dissenting scientists, manipulate the peer-review process, and obscure, destroy or massage inconvenient temperature data—facts that were laid bare by last week's disclosure of thousands of emails from the University of East Anglia's Climate Research Unit, or CRU.
But the deeper question is why the scientists behaved this way to begin with, especially since the science behind man-made global warming is said to be firmly settled. To answer the question, it helps to turn the alarmists' follow-the-money methods right back at them.
Consider the case of Phil Jones, the director of the CRU and the man at the heart of climategate. According to one of the documents hacked from his center, between 2000 and 2006 Mr. Jones was the recipient (or co-recipient) of some $19 million worth of research grants, a sixfold increase over what he'd been awarded in the 1990s.
View Full Image
Associated Press
Al Gore wins the 2007 Nobel Peace Prize: Doing well by doing good?
.Why did the money pour in so quickly? Because the climate alarm kept ringing so loudly: The louder the alarm, the greater the sums. And who better to ring it than people like Mr. Jones, one of its likeliest beneficiaries?
Thus, the European Commission's most recent appropriation for climate research comes to nearly $3 billion, and that's not counting funds from the EU's member governments. In the U.S., the House intends to spend $1.3 billion on NASA's climate efforts, $400 million on NOAA's, and another $300 million for the National Science Foundation. The states also have a piece of the action, with California—apparently not feeling bankrupt enough—devoting $600 million to their own climate initiative. In Australia, alarmists have their own Department of Climate Change at their funding disposal.
And all this is only a fraction of the $94 billion that HSBC Bank estimates has been spent globally this year on what it calls "green stimulus"—largely ethanol and other alternative energy schemes—of the kind from which Al Gore and his partners at Kleiner Perkins hope to profit handsomely.
Supply, as we know, creates its own demand. So for every additional billion in government-funded grants (or the tens of millions supplied by foundations like the Pew Charitable Trusts), universities, research institutes, advocacy groups and their various spin-offs and dependents have emerged from the woodwork to receive them.
The Climate Emails
The Economics of Climate Change
Rigging a Climate 'Consensus'
Global Warming With the Lid Off
Climate Science and Candor
.Today these groups form a kind of ecosystem of their own. They include not just old standbys like the Sierra Club or Greenpeace, but also Ozone Action, Clean Air Cool Planet, Americans for Equitable Climate Change Solutions, the Alternative Energy Resources Association, the California Climate Action Registry and so on and on. All of them have been on the receiving end of climate change-related funding, so all of them must believe in the reality (and catastrophic imminence) of global warming just as a priest must believe in the existence of God.
None of these outfits is per se corrupt, in the sense that the monies they get are spent on something other than their intended purposes. But they depend on an inherently corrupting premise, namely that the hypothesis on which their livelihood depends has in fact been proved. Absent that proof, everything they represent—including the thousands of jobs they provide—vanishes. This is what's known as a vested interest, and vested interests are an enemy of sound science.
Which brings us back to the climategate scientists, the keepers of the keys to the global warming cathedral. In one of the more telling disclosures from last week, a computer programmer writes of the CRU's temperature database: "I am very sorry to report that the rest of the databases seems to be in nearly as poor a state as Australia was. . . . Aarrggghhh! There truly is no end in sight. . . . We can have a proper result, but only by including a load of garbage!"
This is not the sound of settled science, but of a cracking empirical foundation. And however many billion-dollar edifices may be built on it, sooner or later it is bound to crumble.
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Yeah price does have something to do with it, but in some cases that price is the intangibles of regulations favoring the vested interests. They are HUGE in this case. Yes wind and solar are intermittant, but there are ways to store the power. Pumped Hydro, Compressed Air, and Stored Heat are 3 that have been explored, that is what smart grid stuff is about.
One of the vested inerests that is overlooked is the building industry. The Energy Star/ LEED/ and other programs are just stop gaps. Real efforts at efficient home design still get laughed at, less now and more politely done, but it is still there. There are passive solar designs, and other concepts out there that could save large anounts on heating/cooling on houses and buildings. They are not used because of the upfront cost when they are more economical over time, and are unconventional.
DBMA gets much the same mix from the traditional arts, and their industrial partners, I am sure.
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When we talk about nuclear energy, what kind are we talking about?
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From Copenhagen's ashes, a better way to fight global warming
By Bjorn Lomborg
Friday, January 15, 2010; A23
COPENHAGEN Even though no one should have been surprised by the outcome of last month's global climate summit in Copenhagen, the lack of any meaningful action unleashed a torrent of angry and disappointed rhetoric. "The outcome of Copenhagen doesn't at all match the needs . . . of mankind," complained Sweden's environment minister. "By delaying action, rich countries have condemned millions of the world's poorest people to hunger, suffering and loss of life," added Nnimmo Bassey, chair of Friends of the Earth International. And those were some of the milder comments.
Critics, however, should calm down. If anything, the summiteers did the planet a favor by refusing to endorse a binding agreement to drastically reduce carbon emissions. That's because their inability to make progress may be the nudge the international community needs to face the real inconvenient truth: that after nearly two decades of fruitless efforts, it's time to give up our Rio-Kyoto-Copenhagen fantasy and get real about combating global warming.
Two points underlie the issue of global warming: First, developing nations have no intention of letting the developed world force them to stop using carbon-emitting fuels. They are understandably wary of any policy that might curtail the domestic economic growth that is allowing their populations to clamber out of poverty. And that is precisely what drastically reducing their carbon emissions would do.
Second, even for more-developed economies, trying to force drastic cuts in carbon emissions makes no economic sense. All the major climate economic models show that to achieve the much-discussed goal of keeping temperature increases under 2 degrees Celsius, we would need a global tax on carbon emissions that would start at $102 per ton (or about 90 cents per gallon of gasoline) -- and increase to $4,000 per ton (or $35.51 per gallon of gasoline) by the end of the century. In all, this would cost the world $40 trillion a year. Most mainstream calculations conclude that this is 50 times more expensive than the climate damage it seeks to prevent.
In other words, trying to force cuts in carbon emissions is a solution that will cost far more than the problem it is meant to solve. No wonder this option never gained real traction.
So what do we do? Given that global energy demand is expected to double by 2050, the only way to reduce (if not eliminate) our use of fossil fuels without crippling the world economy is to radically ramp up green-energy technologies -- to the point where we can increase our reliance on them by several orders of magnitude. For two decades we have been putting the cart before the horse, pretending that we could cut carbon emissions now and solve the technology problem later. It's time to turn things around. Instead of condemning billions of people to continued poverty by trying to make fossil fuels more expensive, we should make green energy cheaper. This means radically increasing spending on research and development.
In a paper for the Copenhagen Consensus Center last July, Isabel Galiana and Prof. Chris Green of McGill University examined the state of non-carbon-based energy -- including nuclear, wind, solar and geothermal power -- and came to some disconcerting conclusions. Based on current rates of progress, they found that by 2050 our array of alternative energy sources would produce less than half the power we would need from them to be able to stabilize carbon emissions. By 2100, the gap would be even wider. The technology is simply not progressing fast enough in terms of scalability or stability. This should not be surprising. In many areas, there is still a need for the most basic research and development. We are not even close to getting the needed technological revolution started.
But we could be. Devoting just 0.2 percent of global gross domestic product -- roughly $100 billion (70 billion euros) a year -- to green energy R&D would produce the kind of game-changing breakthroughs needed to fuel a carbon-free future. Not only would this be a much less expensive fix than trying to cut carbon emissions, it would also reduce global warming far more quickly.
So let's be grateful that the Copenhagen summiteers were unable to paper over their differences. Their failure should be our wake-up call. After 20 years of getting nowhere, it's time to take a fresh look at the problem and adopt a different approach.
Bjorn Lomborg is director of the Copenhagen Consensus Center and the author of "Cool It: The Skeptical Environmentalist's Guide to Global Warming."
http://www.washingtonpost.com/wp-dyn/content/article/2010/01/14/AR2010011403824.html
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http://www.eventsounds.com/wav/haha.wav (http://www.eventsounds.com/wav/haha.wav)
Three Big Firms Pull Out of Climate Partnership
By STEPHEN POWER And BEN CASSELMAN
WASHINGTON—Three large corporations are quitting the U.S. Climate Action Partnership, a broad group of businesses and environmental organizations that has been instrumental in building support in Washington for capping U.S. emissions of greenhouse gases.
Oil giants BP PLC and ConocoPhillips along with Caterpillar, Inc., the Peoria, Ill., heavy-equipment maker, have decided against renewing their membership in the organization, according to a statement released by the group Tuesday.
Red Cavaney, ConocoPhillips senior vice president for government affairs, said USCAP was focused on getting a climate-change bill passed, whereas Conoco is increasingly concerned with what the details of such a bill would be.
"USCAP was starting to do more and more on trying to get a bill out without trying to work as much on the substance of it," Mr. Cavaney said.
In a written statement Tuesday, Caterpillar said it had decided to direct its resources toward the "commercialization of technologies that will promote and provide sustainable development and reduce carbon emissions." The company recently announced it had joined FutureGen Alliance, an organization that has been working to build a coal-fired, near-zero emissions power plant in eastern Illinois.
Spokesmen for ConocoPhillips and BP said their companies remain committed to passing some kind of climate-change legislation, but believe they can accomplish more working outside USCAP's umbrella.
"Our position on this issue is longstanding and is unchanged," BP spokesman Ronnie Chappell said. "What this does is underscore our desire to continue to participate in this important discussion but to do it as BP."
A spokesman for USCAP said the group intends to continue its campaign for legislation that would cap U.S. emissions of greenhouse gases. The spokesman said any questions about the companies' reasons for not renewing their memberships would have to be answered by the firms.
"We think there's momentum to get [climate legislation] done," the spokesman, Tad Segal, said. "President Obama's State of the Union address made it clear the administration is behind us."
http://online.wsj.com/article/SB10001424052748704804204575069440096420212.html?ru=yahoo&mod=yahoo_hs
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Second Post
Drilling Ban To Cost Trillions
Posted 05:58 PM ET
Energy: A new study shows that our reluctance to develop domestic energy will cost the beleaguered U.S. economy trillions in opportunity costs, reduce our gross domestic product and increase our trade deficit.
From trying to stimulate jobs in nonexistent ZIP codes at great expense to worshiping the false gods of climate change, our biggest deficit these days may be in the area of common sense. A new study shows that many of our wounds are self-inflicted as we forgo the wealth and jobs to be found in our waters and under our feet.
The study by Science Applications International Corp. at the request of the National Association of Regulatory Utility Commissioners, the Gas Technology Institute and others shows the U.S. economy will suffer $2.3 trillion in lost opportunity costs over the next two decades, monies that would go a long way to reining in runaway deficits and creating economic growth.
Critics will say this is another self-serving study paid for by oil industry groups, but unlike the climate change fantasies concocted by the Intergovernmental Panel on Climate Change and Britain's Climatic Research Unit at the University of East Anglia, the study's data can survive fact-checking and the conclusions are rooted in reality.
Drilling restrictions in Alaska's Arctic National Wildlife Refuge and in offshore areas such as the Chukchi Sea and Outer Continental Shelf, the report says, are denying us access to at least nine years' worth of total U.S. oil and gas consumption.
The U.S. used 22.8 trillion feet of gas and 5.2 billion barrels of oil in 2009. Locked up by federal restrictions are approximately 43 billion barrels of oil and 286 trillion cubic feet of natural gas. Without access to these resources, average natural gas prices will rise 17% by 2030 and electricity prices will "necessarily skyrocket," as Barack Obama once said, by 5%.
The net effect of our energy inaction will be a reduction in gross domestic product by $2.36 trillion cumulatively through 2029, or by 0.52% annually. We'd also be forgoing hundreds of thousands of high-paying energy and construction sector jobs here in the U.S. as well as missing a golden opportunity to sharply cut our trade deficit.
These are not climate fantasies derived by running faulty assumptions and bad data through inaccurate computer models. This is simple math, common sense and Economics 101. Energy is expensive. We're leaving vast amounts in the ground while importing it from others. In a word: duh.
Oil accounts for about half our trade deficit. We spend hundreds of billions each year, much of it in borrowed Chinese money, to buy oil from abroad while we let ours sit in the ground. We depend on the world's petrotyrants, including Russia's Vladimir Putin, Iran's Mahmoud Ahmadinejad and Venezuela's Hugo Chavez, who are all too willing to use their energy wealth as a weapon.
President Obama announced on Tuesday an $8.3 billion loan guarantee to help build two nuclear reactors, a move that hopefully will invigorate the nuclear power industry after nearly three decades in which no new plants have been built. We applaud the move, but suspect it's being done more to advance the chance for cap-and-trade legislation than to achieve energy independence.
We back an all-of-the-above approach and so, apparently, do the American people. Comments on a Bush-era rule to expand domestic drilling, held up by Interior Secretary Ken Salazar, ran 2-to-1 in favor of drilling here and now.
In addition to conventional sources of oil and natural gas, we have vast stores locked up in domestic shale formations. The Barnett Shale rock formations of Texas and Louisiana, the Bakken Shale formation in Montana and North Dakota, and the Marcellus Shale formation running through New York, Pennsylvania and other states may hold as much as 2,000 trillion cubic feet of this clean-burning, domestically produced fuel.
So just why are we leaving this job-creating economic windfall in the ground?
http://www.investors.com/NewsAndAnalysis/Article.aspx?id=521249
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SAIC Intl. has some really capable people working with them, I worked with them in Yucca Mountain. That is a report I would pretty much accept. I think we have too many special interests or professional protesters getting in the way of getting done what NEEDS to be done.
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3 to 4.3 Billion Bbls of Recoverable Oil Assessed in N. Dakota and Montana’s Bakken Formation
U.S. Geological Survey ^ | 4/10/2008 | Staff
Contact Information: U.S. Department of the Interior, U.S. Geological Survey Office of Communication 119 National Center Reston, VA 20192
Reston, VA - North Dakota and Montana have an estimated 3.0 to 4.3 billion barrels of undiscovered, technically recoverable oil in an area known as the Bakken Formation.
A U.S. Geological Survey assessment, released April 10, shows a 25-fold increase in the amount of oil that can be recovered compared to the agency's 1995 estimate of 151 million barrels of oil.
Technically recoverable oil resources are those producible using currently available technology and industry practices. USGS is the only provider of publicly available estimates of undiscovered technically recoverable oil and gas resources.
New geologic models applied to the Bakken Formation, advances in drilling and production technologies, and recent oil discoveries have resulted in these substantially larger technically recoverable oil volumes. About 105 million barrels of oil were produced from the Bakken Formation by the end of 2007.
The USGS Bakken study was undertaken as part of a nationwide project assessing domestic petroleum basins using standardized methodology and protocol as required by the Energy Policy and Conservation Act of 2000.
The Bakken Formation estimate is larger than all other current USGS oil assessments of the lower 48 states and is the largest "continuous" oil accumulation ever assessed by the USGS. A "continuous" oil accumulation means that the oil resource is dispersed throughout a geologic formation rather than existing as discrete, localized occurrences. The next largest "continuous" oil accumulation in the U.S. is in the Austin Chalk of Texas and Louisiana, with an undiscovered estimate of 1.0 billions of barrels of technically recoverable oil.
"It is clear that the Bakken formation contains a significant amount of oil - the question is how much of that oil is recoverable using today's technology?" said Senator Byron Dorgan, of North Dakota. "To get an answer to this important question, I requested that the U.S. Geological Survey complete this study, which will provide an up-to-date estimate on the amount of technically recoverable oil resources in the Bakken Shale formation."
The USGS estimate of 3.0 to 4.3 billion barrels of technically recoverable oil has a mean value of 3.65 billion barrels. Scientists conducted detailed studies in stratigraphy and structural geology and the modeling of petroleum geochemistry. They also combined their findings with historical exploration and production analyses to determine the undiscovered, technically recoverable oil estimates.
USGS worked with the North Dakota Geological Survey, a number of petroleum industry companies and independents, universities and other experts to develop a geological understanding of the Bakken Formation. These groups provided critical information and feedback on geological and engineering concepts important to building the geologic and production models used in the assessment.
Five continuous assessment units (AU) were identified and assessed in the Bakken Formation of North Dakota and Montana - the Elm Coulee-Billings Nose AU, the Central Basin-Poplar Dome AU, the Nesson-Little Knife Structural AU, the Eastern Expulsion Threshold AU, and the Northwest Expulsion Threshold AU.
At the time of the assessment, a limited number of wells have produced oil from three of the assessments units in Central Basin-Poplar Dome, Eastern Expulsion Threshold, and Northwest Expulsion Threshold. The Elm Coulee oil field in Montana, discovered in 2000, has produced about 65 million barrels of the 105 million barrels of oil recovered from the Bakken Formation.
Results of the assessment can be found at http://energy.usgs.gov.
For a podcast interview with scientists about the Bakken Formation, listen to episode 38 of CoreCast at http://www.usgs.gov/corecast/.
USGS provides science for a changing world. For more information, visit www.usgs.gov.
Subscribe to USGS News Releases via our electronic mailing list or RSS feed.
**** www.usgs.gov ****
Links and contacts within this release are valid at the time of publication.
http://www.usgs.gov/newsroom/article.asp?ID=1911
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The Inevitable Failure (by Design) of Cap and Trade
Posted By William M. Briggs On March 3, 2010 @ 12:03 am In Column 2, Money, US News | 10 Comments
When Scott Brown (R-MA) won his Senate seat, swept into office by his promise of becoming the Senate’s “filibuster breaker,” a lot of people said: “Whew! Now I don’t have to worry about that atrocious health-tax bill, or that cap and trade monstrosity!”
That just shows how euphoria clouds the mind. Because as soon as Republicans began celebrating, Democrats started furtively passing sealed manila folders to one another while making shushing sounds.
Republican elation didn’t last long. There was a distinct feeling of shock when President Obama let slip that health care was “still on the table.” And not just on the table, but that it would wend its way through the Senate via reconciliation [1], doubtlessly gathering an encrustation of rancid pork as it rolled along.
Well chum, sit down. Because the same thing is happening with the greenhouse gas limiting bill: the cap and trade … and tax, and might as well spend. It, too, has risen from the dead.
Only it never was dead, of course. It was just in hiding, waiting, and now is under active revision with the leadership of John Kerry (D-MA), Lindsey Graham (R-S.C.), and Joe Lieberman (I-CT).
At this writing, the public doesn’t know exactly what measures will be adopted in the revised Senate bill, but we can make some intelligent guesses. The first being that the law of unintended consequences is set to strike once more.
Suppose, as is not likely, that it is true that humans are untowardly affecting the climate such that temperatures are everywhere increasing, and that those increasing temperatures are everywhere devastating or harmful and nowhere helpful. Suppose, too, that these temperature increases are directly caused by controllable greenhouse gas emissions, and that if these emissions can be reduced by a few percentage points, temperatures will not everywhere increase nor be everywhere harmful.
Suppose all that is true. Cap and trade is still a bad idea.
We know that greenhouse gas emissions (GGEs) can be reduced in two ways: by requiring utilities to cap production or engage in sequestration; or by requiring from others limitations on demand.
To limit demand, Congress could mandate citizens drive no faster than 55 miles per hour. That happened before in response to another energy “crisis,” so it is rational to believe it could happen again. Congress might also dabble with forcing rental car companies to use only “energy efficient” (i.e., more expensive) cars.
Perhaps Congress could require transportation companies to prove that some function of “miles traveled,” adjusted by fuel type, vehicle weight, and so forth, holds steady or falls. Or manufacturers will be taxed for exceeding energy-use “goals” (which will be set as a function of the influence of each firm’s senators).
Limiting demand will increase costs, which would have to be spread across the economy. Plus, these are costs with no return on investment — except, possibly, a slightly cooler Earth. Also, any limit strategy will barely put a dent in GGEs, so that even the temperature-ROI is trivial.
Limiting production is straightforward: simply cap allowable GGEs. A mixed strategy of sequestration and sliding caps is also plausible. Utilities will likely be allowed to exceed caps by paying an “offset” tax.
If that is true, then the amount of GGEs will not fall, but will continue their steady increase. The law will then have abandoned its original intent. If it is false — if there are just simple caps and no tax — then the entire American economy will be hamstrung.
This is because there is no way enough nuclear, wind, or solar plants can come on line in any reasonable amount of time to make up for the losses in GGE-based energy. Thus, with just a cap and no tax, Congress will have mandated, “Produce this much, and no more.”
Now, since even Senator Kerry can understand that much economics, it is very likely we’ll see a tax-based bill.
There are hints that a portion of that energy tax will be shunted to the Highway Trust Fund, the agency responsible for the upkeep of interstate freeways. Look forward to fresh paint on the dividing lines and other forms of pork if this bill passes.
Some of the money will have to be put towards non-GGE energy production, both in research and in capital projects.
Who’s going to do the research? Energy companies do it now, of course, and they’ll likely do so in the future.
This means the government will tax energy companies, spend money on a bureaucracy charged with oversight of the tax, siphon some of that money off for “special projects,” and then give a fraction of the money back to companies to research and build non-GGE-based energy platforms. Efficient, no?
In other words, energy companies will be forced to raise rates to pay for the tax — with all the negative consequences that entails — or they will be forced to spend less money on research. Either way, GGEs will not fall. And because research will have been hampered, the introduction of new technology will be delayed.
Thus, in the name of good intentions, cap and trade will cause the harm which it seeks to eliminate.
And you can bet your mother’s cookies that there will be no provision in the bill for it to dissolve if it is discovered that all those suppositions above are proved to be false.
Article printed from Pajamas Media: http://pajamasmedia.com
URL to article: http://pajamasmedia.com/blog/the-inevitable-failure-by-design-of-cap-and-trade/
URLs in this post:
[1] reconciliation: http://blogs.abcnews.com/politicalpunch/2010/03/obama-democrats-will-use-reconciliation-to-pass-senate-health-care-bill.html
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http://formerspook.blogspot.com/2010/04/coming-oil-shortage.html
Tuesday, April 13, 2010
The Coming Oil Shortage?
It hasn't received much play on this side of the Atlantic (oddly enough), but the U.S. military is warning of a severe oil shortage by 2015.
According to a new study produced by Norfolk-based Joint Forces Command (JFCOM), the current surplus in oil production could evaporate within two years, leading to potentially crippling shortages by the middle of this decade.
The U.K. Guardian reports the assessment was forwarded by JFCOM's Commander, Marine Corps General James Mattis. His signature underscores the importance of the study, since a MAJCOM commander typically doesn't "sign out" all intel reports produced by his organization.
JFCOM analysts believe the global shortage will mushroom quickly, reaching 10 million barrels a day within three years after "peak oil"--the moment when demand permanently exceeds supply.
The consequences of the shortfall would be devastating. As outlined in the JFCOM study:
"While it is difficult to predict precisely what economic, political, and strategic effects such a shortfall might produce, it surely would reduce the prospects for growth in both the developing and developed worlds. Such an economic slowdown would exacerbate other unresolved tensions, push fragile and failing states further down the path toward collapse, and perhaps have serious economic impact on both China and India."
While the report doesn't address the potential impact on the United States, you don't need to be an energy analyst to understand that $200 a barrel oil would crush any hopes of an economic recovery and severely impact our military--the largest "single" user of energy in the world.
Still, a cautionary note (or two) is in order. While JFCOM strives to provide an "intellectual foundation" for joint force development, the command's expertise in energy intelligence is limited. Meanwhile, the intel community's experts in such matters (based at the CIA and Department of Energy) have either remained silent--at least publicly--or they offer a more optimistic scenario.
Lionel Badal, a researcher in peak oil theories at King's College in London, told the Guardian that DOE's Energy Information Administration (EIA) has been saying that "peak oil" is still decades away. In light of the JFCOM report, he wonders if DOE is sticking with its rosy scenario.
The military assessment was released as oil surged past $100 a barrel in Great Britain, and retail gasoline prices are approaching $3.00 a gallon in much of the United States. During the shortage that followed Hurricane Katrina in 2005, gas climbed to more than $4.00 a gallon in the U.S.; that level is widely considered a "tipping point," when the public demands action to increase supplies.
Unfortunately, there may be little the United States can do to bolster supplies in the current regulatory environment. President Obama recently approved off-shore drilling along portions of the east coast, but the rest of our coastline (and much of Alaska) remains off-limits. Additionally, environmental challenges often delay the opening of new fields for years.
In an unguarded moment on the campaign trail, then-candidate Barack Obama said his only real regret about $4.00 gasoline was that prices reached that level "so quickly." Based on that statement, it stands to reason that some in the administration see much higher energy prices as inevitable--a development that could be used to spur the development of alternative fuels. Never mind that so-called green fuels can't meet our needs for decades to come.
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ADDENDUM: The JFCOM study is merely the latest to warn of a coming oil shortage. The Guardian reports that the U.K. Energy Minister convened a meeting with top industrialists two weeks ago, apparently reversing his previous position that peak oil was not a short-term problem. Officials at the Paris-based International Energy Agency have voiced similar concerns, though the organization has (officially) stated that energy supplies will remain sufficient.
It's also worth noting that General Mattis, the commander who put his signature on the controversial report, has a reputation for being blunt--sometimes a little too blunt, as evidenced by his famous remarks about how much "fun" it is to shoot terrorists. This time around, Mattis seems appears willing to stake his reputation and credibility on the report, which goes against the "official" U.S. government position on the issue. If no one else is willing to sound the alarm, Jim Mattis has no qualms about stepping up to the plate.
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Most of us here are of the "Drill, baby, drill!" school of thought. What do we have to say about events in the Gulf of Mexico?
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Need to hear a cause before I start ruminating. MSM has been curiously silent as to one.
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Oil spills suck. Not having oil and gasoline sucks worse. I'm not sure if more could have been done to prevent or mitigate the spill as it's way outside my knowledge base.
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http://www.wired.com/autopia/2010/04/university-of-michigan-bio-oil/
Technology like this would be nice.
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http://www.financialpost.com/most-popular/story.html?id=2971866
Not the worst, by far.
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"Most of us here are of the "Drill, baby, drill!" school of thought. What do we have to say about events in the Gulf of Mexico?"
Random thoughts:
When Obama falsely stated he wanted to expand off-shore drilling, everything to do with preventing, curing and containing spills should have been put on fast forward if we are serious about drilling offshore. We are paying for an 'Environmental Protection Agency' already. Instead they are working on exhale restriction justifications.
Obama's reaction was to send a team of lawyers to the gulf. I think he underestimated the seriousness and will regret not making a larger emergency response. They seem more interested in pinning blame than stopping further damage.
We all drive, Obama flies large jets. Obama and Biden fly separate jets. I think Pelosi has a formation of passenger jets with liquor supply jets for commuting. Everything has costs and risks. We need to contain those risks and costs, but we can't end supply without ending usage and we aren't ending usage.
ANWAR is not off-shore. Has less risk or different risks but yet we passed on it based on phony wildlife risks. Middle East involves tanker ships with risk and much of the money goes toward harming our interests. All sources have their own risk.
As others mentioned, hard to know what to learn from this before we know the cause or the cure. Looks like the fix will be to drill a new well. Maybe we should have been geared up to do that in days instead of months. Why aren't we 12 days into that project right now and near completion (if this is a crisis)?
Nature has oil spills. A decade for nature to cleanse itself may be an eternity to us, to those who enjoy the beaches etc. but a blip in time for the planet.
We don't stop flying after a plane crash. We don't stop driving for each fatal crash. We kill 37,000 per year and keep right on driving. This catastrophe will need to be repaired and studied. Presumably oil rigs will be even safer and repairs swifter in the future because of this.
Nuclear has the cleanest, safest track record for energy production yet we can't agree on it here whether to move forward with more. If commuting energy can move someday to plug in vehicles, we will need more energy on the grid to replace the amount of oil we quit using.
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EPA has a discretionary budget of over $10 Billion, Dept of Interior -even more. Off-shore drilling was on the agenda, announced months ago. A fire boom could have contained 95% of this spill, costs a few hundred thousand. Not a one anywhere near the gulf. Feds didn't even know if they owned one; found one in storage. [Soon this storyline will be your healthcare.]
http://blog.al.com/live/2010/05/fire_boom_oil_spill_raines.html
Despite plan, not a single fire boom on hand on Gulf Coast at time of oil spill
By Ben Raines May 03, 2010 Source: Alabama Press-Register
(See photo at link) An image provided by Carmi, Ill.-based Elastec/American Marine shows an oil burn being conducted in one of its patented Hydro-Fire Boom systems. The inflatable, fire-resistant, water-cooled boom was developed to contain surface oil and burn it offshore, helping prevent destruction of critical environmentally sensitive shoreline habitats, company officials said.
If U.S. officials had followed up on a 1994 response plan for a major Gulf oil spill, it is possible that the spill could have been kept under control and far from land.
The problem: The federal government did not have a single fire boom on hand.
April 28, 2010 image made from video released by the Deepwater Horizon Response Unified Command, shows an in situ burn in the Gulf of Mexico, in response to the oil spill after the explosion on the Deepwater Horizon. The "In-Situ Burn" plan produced by federal agencies in 1994 calls for responding to a major oil spill in the Gulf with the immediate use of fire booms.
But in order to conduct a successful test burn eight days after the Deepwater Horizon well began releasing massive amounts of oil into the Gulf, officials had to purchase one from a company in Illinois.
When federal officials called, Elastec/American Marine, shipped the only boom it had in stock, Jeff Bohleber, chief financial officer for Elastec, said today.
At federal officials' behest, the company began calling customers in other countries and asking if the U.S. government could borrow their fire booms for a few days, he said.
A single fire boom being towed by two boats can burn up to 1,800 barrels of oil an hour, Bohleber said. That translates to 75,000 gallons an hour, raising the possibility that the spill could have been contained at the accident scene 100 miles from shore.
"They said this was the tool of last resort. No, this is absolutely the asset of first use. Get in there and start burning oil before the spill gets out of hand," Bohleber said. "If they had six or seven of these systems in place when this happened and got out there and started burning, it would have significantly lessened the amount of oil that got loose."
In the days after the rig sank, U.S Coast Guard Rear Admiral Mary Landry said the government had all the assets it needed. She did not discuss why officials waited more than a week to conduct a test burn. (Watch video footage of the test burn.)
At the time, former National Oceanic and Atmospheric Administration oil spill response coordinator Ron Gouguet -- who helped craft the 1994 plan -- told the Press-Register that officials had pre-approval for burning. "The whole reason the plan was created was so we could pull the trigger right away."
Gouguet speculated that burning could have captured 95 percent of the oil as it spilled from the well.
Bohleber said that his company was bringing several fire booms from South America, and he believed the National Response Center discovered that it had one in storage.
Each boom costs a few hundred thousand dollars, Bohleber said, declining to give a specific price.
Made of flame-retardant fabric, each boom has two pumps that push water through its 500-foot length. Two boats tow the U-shaped boom through an oil slick, gathering up about 75,000 gallons of oil at a time. That oil is dragged away from the larger spill, ignited and burns within an hour, he said.
The boom can be used as long as waves are below 3 feet, Bohleber said.
"Because of the complexity of the system and the obvious longer production time to build them, the emphasis is on obtaining and gathering the systems," he said.
Bohleber said his company has conducted numerous tests with the Coast Guard since 1993, and it is now training crews on the use of the boom so workers will be ready when they arrive.
"We're arranging for six to be shipped in. We keep running into delays. Hopefully, they will be here by Wednesday to be available for use on Thursday. Bear in mind, two days ago, we thought they would be here today."
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From Department of the Interior. Notice "response" plan. Stand up comedy must be part of the response. I am glad to note Kim Kardashian and Jessica Simpson were so entertained.
Also good to see our government "on top of it from day one":
http://www.mms.gov/regcompliance/MOU/PDFs/MOU-MMSUSGS-OilDischargeMOAMay232007.pdf
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http://www.realclearpolitics.com/articles/2010/05/03/gov_haley_barbour_on_the_bp_oil_spill_105438.html
BLITZER: How worried should the folks in Mississippi be right now about the beautiful coastline along the Gulf of Mexico?
BARBOUR: Well, we need to be prepared. My view of this is when you pray for the best, prepare for the worst. But a lot of people are assuming that this is going to be catastrophic, and that is not a safe assumption.
Right now, there's no oil within 50 miles of the Mississippi. Eighty percent of the oil slick, as it's called and appropriately -- 80 percent is literally just sheen or film right on top of -- on top of the water. That is not toxic. It's not particularly damaging.
I mean, we don't want it to come ashore in Mississippi, but it's manageable. It's a manageable problem. Our people on the coast are getting ready.
And I do think a lot of people in the country are being led to believe that this is already some gigantic catastrophe. Well, that's not the case and we're going it try to keep it from ever being the case.
BLITZER: I think what some of those who are really worried hear most, if it isn't contained within the next, you know, few weeks, if it goes on two or three months, it will be a much worse problem for the Gulf of Mexico, for the folks in Louisiana and Mississippi, Alabama and Florida, than the Exxon Valdez spill was in Alaska.
BARBOUR: Well, people say that. And that is certainly a possibility. If the well were to break back open and be flowing and at maximum potential, if it did that for 90 days -- yes, then it could be a terrible catastrophe. That hasn't happened yet, may not happen.
You mentioned the containment dome. There's been great work done in the last 72 hours putting dispersant into the oil right above the wellhead, and it looks like that is breaking up the oil and greatly reducing what comes to the surface.
Look, we're not happy with what's going on by a long shot. But we haven't come to the conclusion that this is a have-to-be catastrophe because it doesn't have to be.
BLITZER: I was just reading a story. The governor of California, Arnold Schwarzenegger, says it's time now to stop drilling or at least stop expanding oil drilling off the California coast until they get to the bottom of what happened in the Gulf of Mexico. Would that be wise right now to stop offshore drilling in the Gulf of Mexico?
BARBOUR: Well, it certainly wouldn't be wise to stop the Gulf of Mexico. We've drilled thousands and thousands and thousands of oil wells in the Gulf of Mexico. And this -- this collapse and this spill is very, very, very fierce, but it is also one out of thousands of wells that have been drilled. We produce about 30 percent of the nation's oil in the Gulf of Mexico. We produce -- we used to produce about 25 percent of the natural gas. That percentage is declining, but oil drilling in our gulf has been safe 40 years, even through Katrina. Now we've had a terrible accident and incident. We need to get to the bottom of it, but we don't need to shut it down.
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Surprise!
http://www.politico.com/news/stories/0510/36783.html
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NOT!
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I must say that I feel sick to my stomach at the environmental disaster that is unfolding in slow motion in the Gulf.
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The revelation of the oil deep in the ocean which may enter the gulf current is worrisome. The unknown is always worrisome. In the 80's if you went to the beach in Texas you would inevitably step in a tar ball. There was oil on the beach it was part of the way the beach was, normal. The environment seemed to be in pretty good shape. The fishing was very good. You never saw a bird covered in oil. My point is the gulf is capable of handling some oil. Now oil on this scale? We have yet to see massive slicks on the beaches. I am just waiting for the other shoe to drop.
An annoying aspect of this fiasco, just one of many, is the government reg limiting the damages BP is liable for, here is a glaring example of how gov't intervention can hurt the industry. I feel if the gov't had stayed out of it then the liability would have been such that there would have been not 1 failsafe device but 5 or more. After the 80's the oil companies running the rigs off the coast put these devices in place with some others, not sure what, and the oil on the beaches became very very rare. They have had 2decades of oil free beaches, a pretty good record. Of coarse this one oh sht wipes out 2 decades of at a boys!
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The Good Side of Bad News in Europe
Posted by Alan Reynolds
What does the Greco-Euro currency/debt crisis mean for the U.S. economy?
Nearly everyone except the uniquely wise economist John Cochrane assumes very bad “contagion” effects –on U.S. banks, exports and particularly U.S. manufacturing.
This echoes identical anxieties while the world went through a far more dramatic Asian currency crisis after July 1997, and a Russian debt crisis the following May.
The most widely ignored effect of that crisis, however, was to depress foreign demand for oil, and thus slash oil prices to U.S. buyers from $25 a barrel in early 1997 to $11 by the end of 1998.
Oil is a major input into the manufacturing process (e.g., chemicals and plastics), and a major cost of distribution (trucks, trains and airplanes). It is also a major determinant of the cost of all energy sources used in making other goods such as aluminum and paper. When marginal costs go down, it becomes profitable to expand production.
At the height of the Asian/Russian crises, the table below shows that U.S. manufacturing output rose by more than 10 percent. It’s an ill wind that doesn’t blow somebody some good.
Looking at the same phenomenon from the other side, every recession but one (1960) was preceded by a big increase in the price of oil. For oil importers like the U.S., cheaper oil is definitely better.
During the last big foreign currency/debt crisis, the real growth of U.S. Gross Domestic Purchases (the home-grown portion of GDP) jumped by 4.7% in 1997 and 5.5% in 1998. Yet the Fed cut interest rates three times in October and November of 1998 because of what was happening in other countries.
The table show what happened to the price of oil and to U.S. manufacturing from June 1997 to December 1998. The middle column is the price of a barrel of West Texas crude, and the column to the right is the U.S. industrial production index for the manufacturing sector.
1997-06 19.17 87.80
1997-07 19.63 88.12
1997-08 19.93 89.69
1997-09 19.79 90.45
1997-10 21.26 90.98
1997-11 20.17 92.05
1997-12 18.32 92.52
1998-01 16.71 93.36
1998-02 16.06 93.31
1998-03 15.02 93.13
1998-04 15.44 93.68
1998-05 14.86 94.25
1998-06 13.66 93.53
1998-07 14.08 92.96
1998-08 13.36 95.40
1998-09 14.95 95.11
1998-10 14.39 95.96
1998-11 12.85 96.08
1998-12 11.28 96.63
In recent weeks, as the debt and currency problems in Euroland hit the front page, the price of crude oil fell by about 20 percent.
Once again, as in 1997-98, everyone may be watching the wrong ball in the wrong court.
http://www.cato-at-liberty.org/2010/05/18/the-good-side-of-bad-news-in-europe/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+Cato-at-liberty+%28Cato+at+Liberty%29
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I feel sick in my stomach at the ever growing disaster.
Is BP doing all that it can?
Should the Feds be doing more?
http://www.nytimes.com/2010/05/24/us/24spill.html?th=&adxnnl=1&emc=th&adxnnlx=1274699030-xUgRIJqS2vUkLe/OSeIVlA
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"I feel sick in my stomach at the ever growing disaster. Is BP doing all that it can? Should the Feds be doing more?"
We will know more later. Maybe they will plug the hole today and then we can reflect on what went wrong. The filth depresses me too, yet I heard an LSU professor of environmental sciences say that nature leaks this much anyway through the gulf floor but not concentrated in one location like this. He hated to say aloud that the magical formula for dispersion would be a severe tropical storm (probably coming soon).
Interesting insight from a radio host today (not an energy expert): We drill sooooo deep and sooooo far from shore because of the past 'success' of environmental extremism. This spill would be more manageable and solvable if it was more reachable. I wonder if that is true.
Politically, I would like to know what day (somewhere between day 6 and day 8 ) it was that the Obama defenders began using the phrase "since day one". When we finally plug it we can ask ourselves why that solution was not ready before the spill or airlifted across the world if necessary on 'day one'. And why the blowout protectors don't protect against blowouts, while the federal regulators have time for this and money for that - fill in your own wasteful examples - studying the sex habits of female college freshmen, 4 hour erection warnings etc.
I recall that Obama offered to open more offshore drilling about two months prior to this but predicated it on more studies, (a fake, like his effort to send 3 troops to the border). Alright, valuable time went by even if it was only a couple of months, and millions were spent by these agencies, where are those studies or why were we lied to and who will be fired? I think you will find that the environmental regulators were viewing porn like the SEC regulators on taxpayer internet connections and corresponding with their friends in the global warming farce crowd and the political lobbies instead of doing the science and regulatory functions they were assigned like reviewing the testing procedures of blowout protectors.
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When MSNBC made sure *everyone* knows the ONE is soooo outraged when he said in "private": "plug the damn hole" all I could think of is the hole I wish could get plugged is the mouthpiece between his ears.
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http://online.wsj.com/article/SB10001424052748704026204575266560930780190.html?mod=rss_whats_news_us
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'Obama said that every morning when he's shaving, his daughter comes in and asks, "Did you plug the hole yet, Daddy?"'
Who here besides me is old enough to remember Jimmy Carter asking his daughter Amy what was the worst problem facing the world and then using that in a speech??
This guy is such a Jimmy Carter on steroids.
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http://online.wsj.com/article/SB10001424052748704026204575266560930780190.html?mod=rss_whats_news_us
I see that in a lot of "SOP's" dangerous levels not quantified- so it is a matter of opinion, standard of behavior not described-more matter of opinion. A lot of answers when corrections or definitions are asked for is "wellll, its common sense!" <walk off in huff over questioned authority> There is no such thing as common sense- not even common courtesy either. So there things hang............ Typical bureaucratical shared responsibility will result in a logjam in an emergency/ crisis management situation. If a Captain at sea cannot step in and get it handled- he should not be a captain. A crisis Management Team sounds nice on paper but it is really and oxymoron.
That rig worker made a call according to a saftey judgement (shouldn't we get boats moving just in case this situation really develops into a worst case?) and got reprimanded- isn't saftey always first..........? If levels are defined and standards of behavior are met- there would be no need for a crisis management team or several tons worth of "analysis" paperwork after the fact. The captain would give the orders and take reports as everyone worked to standard. Confusion in the lifeboat areas tells me that people were not drilled, and did not KNOW the standard of behavior- go to the proper assigned boat etc.
Pretty much a nasty mess on the rig as the one that ended up in the ocean. Yes an accident was way past due, but the severity could have been very mitigated if there had been less keystone cops and more crew doing their jobs, eh?
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Unsustainable Energy
Europe’s green economy points the way: down
President Obama’s visit to a California solar plant on Wednesday provided another reminder that the only jobs he seems truly passionate about are “green jobs.” It’s been this way for a long time. Shortly after Election Day, Time reported that, “With the possible exception of Barack Obama’s puppy-anticipating daughters, no one is more eagerly awaiting the incoming Administration than the leaders of the renewable-energy industries.” Obama promised hundreds of billions in new subsidies for renewables during his campaign, and he delivered on that promise once he took office. The solar plant he toured, Solyndra Inc., received a $535 million loan guarantee funded through last year’s stimulus package, which included around $17 billion for such projects.
But despite all the money the Obama administration and its congressional allies have steered toward the clean-energy sector, no sector’s stocks have performed worse over the last year. The latest Goldman Sachs weekly analysis of U.S. market trends revealed that the PowerShares WilderHill Clean Energy Portfolio, an exchange-traded fund that tracks the clean-energy sector, is down 23 percent on the year, worse than any other sector-specific fund in Goldman’s analysis. (The next-worst sector, steel, was only down 16 percent on the year.) If you look for answers as to why such a heavily subsidized sector has suffered such a precipitous drop, you’ll find two: oil prices and Europe.
Most forms of clean tech cannot compete commercially with fossil fuels, which means two things: First, their fortunes are tied to the prices of coal, oil, and natural gas. When those prices rise, clean tech begins to look more attractive as an alternative source of energy; when they fall, so do clean-tech stock prices. Oil prices, which reached $140 a barrel two years ago, have rebounded from their post-financial-crisis lows (around $30 a barrel), but appear to have stalled out at around $70 for the time being. Major economic uncertainty has buyers of oil futures justifiably taking a wait-and-see approach with regard to future demand.
If Obama really wants to see clean tech take off, he needs to make oil much more expensive than $70 a barrel (don’t think he isn’t trying); but in the mean time, he has to keep the subsidies to companies such as Solyndra flowing. This is the second thing to keep in mind: Clean-tech companies depend on the willingness of governments to subsidize them. The problem they are encountering at present is that the governments that most enjoy subsidizing them are found in Europe, and Europe is running out of money.
Across the continent, European governments are announcing cutbacks in clean-tech subsidies. Germany’s parliament voted earlier this month to cut some subsidies for solar power by 15 percent and to eliminate other solar-subsidy programs altogether. And Spain started withdrawing its subsidies for solar in late 2008, bursting a bubble that had built up in that sector, just as the oil-price collapse burst the U.S. ethanol bubble around that same time.
Both bubbles followed the same familiar pattern: The government promised a subsidy or a mandate to promote this or that renewable fuel. The makers of that fuel attracted private investors, lured by the promise of government support, and pretty soon the field was crowded with competitors trying to get a piece of the subsidized action. But everyone forgot that there was no real demand for the product. When the price of oil dropped and the government cut back on its aid, consumers were left with a surplus of expensive, unreliable energy they never really wanted in the first place. Prices collapsed, and investors rushed for the exits almost as fast as they rushed in, leaving a wave of bankruptcies and layoffs.
At least Spain is learning its lesson. The president of Spain’s national energy regulator has called its current system of subsidizing solar “unsustainable.” A headline atop one Spanish newspaper reads, “Spain admits that the green economy sold to Obama is a ruin.”
How many more years can the U.S. president afford to live in denial on this point? As Europe struggles with its enormous debt load, Obama increases ours at record rates. As Europe tightens, Obama promises more loan guarantees for plants such as the one he visited yesterday in California, a state that is offering us a preview of what it’s like to live through a debt crisis. Here’s a hint: The state’s independent auditing agency just released a damning study on the cap-and-trade program California plans to implement unilaterally, concluding that the “net economywide impact” — which includes badly needed revenue for the state’s empty coffers — “will in all likelihood be negative.” The case of California shows us that our illusions about the economic feasibility of a green-energy utopia are on a fast track to the dust bin.
“It’s fitting that this technology is being pioneered here in California,” Obama remarked on Wednesday.
Fitting indeed.
— Stephen Spruiell is an NRO staff reporter.
http://article.nationalreview.com/435099/unsustainable-energy/stephen-spruiell
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http://www.americanthinker.com/2010/05/environmentalists_with_oil_on.html
May 27, 2010
Environmentalists with Oil on Their Hands
By Henry P. Wickham, Jr.
When evaluating in an honest way all factors that contributed to the current pollution of the Gulf, we must ask why BP was drilling in 5,000 feet of ocean when there are so many other accessible and safe alternatives. There are large deposits of oil shale in Western Colorado that could easily and safely be extracted as it is now in Western Canada. We have all heard of the huge deposits of oil in ANWR, on Alaska's North Shore. Because of improved drilling technology, all available oil in ANWR can be extracted by using only 2,000 of its roughly 19,000,000 acres.
BP now drills in 5,000 feet of ocean because these better alternatives have been foreclosed to the oil industry. Environmental groups have effectively stymied this safe and relatively easy production of oil in the name of some higher but more nebulous good. Where they once rationalized their campaign against oil companies based upon the threat of environmental degradation, environmental groups now use the increasingly dubious claims of global warming to justify their obstruction.
As the policies of environmental groups were a factor in what we now see in the Gulf of Mexico, so they were in the 1989 Exxon Valdez disaster. When huge quantities of oil were discovered in Prudhoe Bay on the North Shore of Alaska in the mid-1960s, one issue among many was the transportation of this oil.
The safest approach was a pipeline from the North Shore directly to the northern border of the contiguous United States. As a member of the Sierra Club at that time, I remember well the relentless war that the Sierra Club waged against both the drilling and the pipeline. In what has now become a predictable strategy, the Sierra Club catastrophized the entire project and attacked the motives of those who sought merely to respond to the demand for oil by the American public.
The Sierra Club at that time published a "Battlebook," where readers were told that the drilling and pipeline "will despoil thousands of acres of virgin wilderness, change the ecology of huge tracts, pollute Alaska's rivers and harbors, and interrupt the migration patterns of the caribou herds."
Because of what he called this "mindless onslaught of technology," the author asserted that the caribou herds would be decimated as American buffalo were in the 19th century. His heated rhetoric, no doubt a contribution to global warming, took control as he wrote that this development was a "rape" in the name of "fat profits."
Fortunately for America, the environmentalists at that time did not have the political clout they do now. Prudhoe Bay was developed, and it now operates without all the dire consequences to the land so hysterically predicted by the Sierra Club. However, as a partial victory for the environmentalists, the pipeline was constructed only to Valdez, Alaska, rather than to the border of the lower forty-eight states. And so, on March 24, 1989, the Exxon Valdez ran aground, dumping 10.8 million gallons of crude oil into the ocean. Exxon is certainly responsible for the blunders that occurred that day.
In the one instance where a Sierra Club predictions came true, the Sierra Club had a hand in that disaster. The blunders of the ship's captain likely would not have occurred had it not been for the obstruction of the pipeline that could have reached the contiguous United States. The longer pipeline would have eliminated, or at least significantly reduced, the need for an Exxon Valdez. As with the wreck of the Exxon Valdez, the crisis today in the Gulf may not have occurred if the environmentalist groups like the Sierra Club had not obstructed so many of the safe alternatives to drilling in 5,000 feet of ocean.
The chronic obstruction of so many economic endeavors is a symptom of deeper problems in the environmental movement. Environmentalists tend to live in a fantasy world, where some unattainable perfection is always the enemy of the good. What was once reasonable conservation has become for many the pseudo-religion of environmentalism, where Luddite obstruction is the default position, and no environmental benefit, no matter how small, is ever too costly.
Aside from the nostalgic illusions of some lost Eden, among environmentalists there is a strong element that opposes democratic capitalism. Environmentalism becomes just another means to a dreamy collectivized end. They simply ignore or are ignorant of the causes of their comfortable life and the serious environmental degradation done by regimes with" planned" economies and "public" ownership of the means of production.
Environmentalism is also a worldview where one never really has to accept or take responsibility for the consequences of those policies. Millions die of malaria because affluent environmentalists had the political might to have DDT banned. America can be deprived of new sources of safe and clean nuclear energy because of the hysterical and dishonest war waged against the nuclear power industry. Environmentalists can tout wind power while campaigning to obstruct its generation near the shores of Cape Cod. (We must not interfere with the yachting patterns of the local but classy endangered species off Hyannisport.) Environmentalists seem never to be called to account.
As we experience the effects of and calculate the enormous costs to clean up the Gulf of Mexico, by all means, let's hold BP accountable. But let's refuse to give the environmentalists a free pass. We must judge them by all the consequences of what they advocate, and not just by their flowery rhetoric, pretty calendars, and supposedly noble intentions. We must emphasize that for all those supposedly "green" benefits, there are real costs and risks that the environmentalists downplay or conceal. In this case, environmentalists have Gulf oil on their hands as much as any floating pelican carcass, although we will never get an acknowledgment of any responsibility or an apology from them.
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June 03, 2010
Is there a political reason behind the Obama Administration's foot-dragging on the Gulf Oil Clean-Up?
Bill Weckesser
Is the Obama administrations slowness to deal with the gulf oil disaster simply another example of government bungling or is there more to it? There appears to be one common thread that connects all of the administration's actions, or inaction, as well as both liberal and conservative criticisms -- namely, the administration's slow response. But, more pointedly the administration has been foot-dragging clean up efforts. The Wall Street Journal reports that criticizing the clean-up has become Louisiana Governor Bobby Jindal's daily routine.
Nearly every day, the Republican policy wonk pulls on his brown cowboy boots and traipses across a newly oiled shore, or takes a boat through fouled waters. Along the way, he often lambastes BP's and the federal government's efforts as "too little, too late" for communities scrambling to protect their fragile wetlands from encroaching crude—comments that have drawn sharp criticism from the White House and some Democratic lawmakers.
Louisiana has jurisdiction over its coastline, but none in the federal waters of the Gulf.
Mr. Jindal accuses the federal government of poorly coordinating cleanup efforts between its agencies and BP, leading to delays in cleaning oiled beaches and marshes, laying protective boom and delivering resources to critical areas.
One can understand the difficulties in plugging a well that's about a mile underwater; it's certainly a daunting task. But cleaning oil spills is routine work. There are many methods and there've been lots of suggestions. Industry expert John Hofmeister argues that supertankers have been successfully used before. The idea is all over the internet; for instance Esquire has a blog about it
There's a potential solution to the Gulf oil spill that neither BP, nor the federal government, nor anyone — save a couple intuitive engineers — seems willing to try. As The Politics Blog reported on Tuesday in an interview with former Shell Oil president John Hofmeister, the untapped solution involves using empty supertankers to suck the spill off the surface, treat and discharge the contaminated water, and either salvage or destroy the slick.
Hofmeister had been briefed on the strategy by a Houston-based environmental disaster expert named Nick Pozzi, who has used the same solution on several large spills during almost two decades of experience in the Middle East — who says that it could be deployed easily and should be, immediately, to protect the Gulf Coast. That it hasn't even been considered yet is, Pozzi thinks, owing to cost considerations, or because there's no clear chain of authority by which to get valuable ideas in the right hands. But with BP's latest four-pronged plan remaining unproven, and estimates of company liability already reaching the tens of billions of dollars (and counting), supertankers start to look like a bargain.
The real question now is, "Why has the administration blocked clean-up efforts, of all things? There's no argument that it may take until August for new wells to stem the leak, but why isn't everything possible being done to clean the water and prevent as much oil from coming to shore as possible? Is it merely government bungling or is there a political agenda at work here? This is, after all, the administration that vowed to "never waste a good crisis."
Did the administration early on make a conscious effort to stone-wall the clean up efforts in an attempt to use scenes of dirty birds and blobs of oil to sway public opinion in favor of its green, cap-and-trade agenda that's looked all but dead in congress? Could much of the environmental and economic destruction been averted by an aggressive clean-up and containment effort? Who in the administration is to blame? And why?
One can only hope that American's will begin asking these tough questions about what appears to be a willful slowness on behalf of Bama Petroleum to vigorously attack the clean-up and preservation efforts.
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Some other spills
http://www.incidentnews.gov/incident/6250
This site lists other oil spills and their tonnage from over the years:
http://oceanworld.tamu.edu/resources/oceanography-book/oilspills.htm
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Gov. Haley Barbor of Miss. said today that 7 of the biggest 10 spills came from tankers. I think that matches the info in Crafty's link. Barbor said that the greatest economic damage so far to his state is the news coverage. Photos of only the worst spots create the impression the whole shoreline is like that right now and it isn't, he said.
Most spillage is natural. In the long run, drilling, capturing and using the oil beneath the gulf should lessen the natural seepage I would think, if that is the goal.
While we put a moratorium on new deepwater rigs, why not open ANWR and shallower areas off-shore?
Or quit driving. I would like to see a moratorium on Air Force One flights during the drilling ban. The man is in his 40s and owns a bicycle, does he not?
Same for Pelosi. If we say we can do without oil, let's start with the leadership and see how it goes.
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This also could be posted in the Issues in the American Creed -Constitutional Law thead on the SCH forum as a matter of Separation of Powers.
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For Immediate Release: June 7, 2010
Contact: David Almasi at (202) 543-4110 x11 or (703) 568-4727
or dalmasi@nationalcenter.org
Judy Kent at (703) 759-7476 or jkent@nationalcenter.org
Senators to Vote on Whether to Cede Congressional Authority to the EPA
Washington, D.C. - Senators will soon consider a resolution to pare back an Environmental Protection Agency plan to regulate greenhouse gases - a plan that would raise energy costs.
On June 10, the U.S. Senate will consider a "resolution of disapproval" regarding a 2009 ruling made by the EPA in late 2009 claiming six greenhouse gases are a threat to public health. This makes these gases -- carbon dioxide, methane, nitrous oxide, hydrofluorocarbons, perfluorocarbons, and sulfur hexafluoride -- subject to regulation under the Clean Air Act.
"The EPA's endangerment finding endangers our economy and our liberty," said Deneen Borelli, full-time fellow with the Project 21 black leadership network. "The EPA's effort to regulate greenhouse gases will affect virtually every aspect of our economy and our lives. In expert opinion, this will result in higher energy costs and job losses while having -- by their own admission -- virtually no effect on cooling global climate."
Senate Joint Resolution 26, introduced by Senator Lisa Murkowski (R-AK), would use the Congressional Review Act to overturn the administrative ruling. This would allow elected representatives to deliberate and pass their own regulations as Congress sees fit.
"I don't want an unelected bureaucrat imposing rules and regulations on businesses that are essentially a tax on energy and will be passed along to consumers -- many of whom are just getting by as it is," said Tom Borelli, director of the Free Enterprise Project of the National Center for Public Policy Research.
"Opposition to the cap-and-trade bill that was jammed through the House of Representatives is one of the key positions of the tea parties, and this endangerment finding is cap-and-trade by other means," noted Deneen Borelli. "Americans are already skeptical enough of lawmakers these days. Watching them pass up an opportunity to do what they were sent to Washington for will restore no lost faith in the government."
"This resolution is a major indicator of where our republic is headed. Senators will determine if they are going to cede their authority as an elected representative of the people to largely unaccountable bureaucrats," added Tom Borelli. "While the White House is eager for the EPA to seize regulatory authority, rank-and-file Americans such as those found in the tea party movement are troubled and will be watching to see who will be for and who will be against this massive federal power grab."
The National Center for Public Policy Research is a non-profit, free-market think-tank established in 1982 and funded primarily by the gifts of over 100,000 recent individual contributors. Less than one percent of funding is received from corporations.
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Looks like the Community Organizer in Chief would do well to take lessons from these folks.
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In Alabama, a Home-Grown Bid to Beat Back Oil
By JOHN LELAND
Published: June 7, 2010
MAGNOLIA SPRINGS, Ala. — James Hinton looked over a barge jutting into the mouth of a 6,000-acre estuary last weekend and said, “If we can make this work, if the oil don’t get in here, 1,275 miles of bay and river coastline will be protected. I could go to jail for going against unified command. Now, I don’t mind going to jail, I just need to make sure it’s for doing the right thing.”
In a month in which Gulf Coast officials have railed about not being able to protect their shorelines from oil and not getting support from BP or the unified command structure set up to handle the cleanup efforts, Mr. Hinton, a volunteer fire chief in Magnolia Springs, a small town of fewer than 1,000, has emerged as a man with a plan.
“What he’s doing is really admirable,” said Bethany Kraft, executive director of the Alabama Coastal Foundation, a nonprofit environmental group. “He’s taking things into his own hands instead of waiting for other people to do something about it.”
Mr. Hinton went into action the first week of May, calling a town meeting to discuss ideas for protecting Weeks Bay, an estuary off Mobile Bay that supports 19 federally protected species, including bald eagles and wood storks. The residents came up with a solution that is unique on the gulf, said Malissa Valdes, a spokeswoman for the unified command, which approves all responses in federally governed waters.
From the start, the townspeople were unsatisfied with the unified command’s plan for Weeks Bay — a strand of floating surface barriers known as boom stretched across the bay’s mouth. Because of tidal currents, any oil on top of the water could splash over the boom, then into the bay and up the Fish and Magnolia Rivers into nurseries for area wildlife. A plan to string boom across Mobile Bay failed when water shredded the barrier.
Mr. Hinton’s solution was simple: run a wall of barges across the mouth of Weeks Bay to block the current, then run five layers of boom behind it — two to block the oil, and three strands of absorbent boom to soak up any oil that got through the containment layers.
The town bought the boom right away, before an increase in demand nearly quadrupled the price. Money for the project came from the state, which received $25 million from BP for emergency response efforts.
“We’re not biologists or engineers or scientists,” Mr. Hinton said. “We took common sense and what we knew about the water from living here. I’m pretty proud of our little plan.”
Between rain showers on Sunday, two dozen volunteer firefighters and teenage explorers laid out the layers of boom, while a tugboat and a crane moved nine barges into place, anchored by 40-foot spikes, with a closeable 100-foot gap for boats to pass through.
To seal the bay entirely they would need approval from unified command. But they are resolved to close it at the first sight of nearby oil, with or without approval, said Charles S. Houser, the mayor of Magnolia Springs, who earns a monthly salary of $100.
“We’re not going to wait for BP,” Mr. Houser said. “If we saw oil right there we’d close the bay right now. The lesson we learned from Louisiana is to act, not wait. We’ll ask for forgiveness later.”
The biggest challenge, Mr. Hinton said, has been dealing with BP and the unified command bureaucracy. The 36 fire chiefs in Baldwin County here passed a resolution to censure BP for poor communications with fire crews.
Mr. Hinton said that so far no other communities had contacted him about copying his plan. “A fire chief told me, ‘Jamie, you can slow down in your preparations, the federal government is going to take care of it.’ I said, ‘Meaning the way they took care of Katrina, Ivan and the Valdez spill?’ ”
He added: “If you wait on BP, it’ll be like Louisiana. They had a month to protect the marshes. The Bible says the good Lord made the world in seven days. I’m not going to risk what happened in Louisiana happening here.”
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Reuters
The seven experts who advised President Obama on how to deal with offshore drilling safety after the Deepwater Horizon explosion are accusing his administration of misrepresenting their views to make it appear that they supported a six-month drilling moratorium -- something they actually oppose.
The experts, recommended by the National Academy of Engineering, say Interior Secretary Ken Salazar modified their report last month, after they signed it, to include two paragraphs calling for the moratorium on existing drilling and new permits.
Salazar's report to Obama said a panel of seven experts "peer reviewed" his recommendations, which included a six-month moratorium on permits for new wells being drilled using floating rigs and an immediate halt to drilling operations.
"None of us actually reviewed the memorandum as it is in the report," oil expert Ken Arnold told Fox News. "What was in the report at the time it was reviewed was quite a bit different in its impact to what there is now. So we wanted to distance ourselves from that recommendation."
Salazar apologized to those experts Thursday.
"The experts who are involved in crafting the report gave us their recommendation and their input and I very much appreciate those recommendations," he said. "It was not their decision on the moratorium. It was my decision and the president's decision to move forward."
In a letter the experts sent to Salazar, they said his primary recommendation "misrepresents" their position and that halting the drilling is actually a bad idea.
The oil rig explosion occurred while the well was being shut down – a move that is much more dangerous than continuing ongoing drilling, they said.
They also said that because the floating rigs are scarce and in high demand worldwide, they will not simply sit in the Gulf idle for six months. The rigs will go to the North Sea and West Africa, possibly preventing the U.S. from being able to resume drilling for years.
They also said the best and most advanced rigs will be the first to go, leaving the U.S. with the older and potentially less safe rights operating in the nation's coastal waters
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It is interesting to see the rift between UK and OBama unfold. I would suppose he is no longer their favorite guy.
His handling of the spill by blaming incessantly BP and doing everything possible to avoid responsibility and shift 100% blame on them is analagous to his everall style.
He is not a compromiser, or someone who brings sides together. He is actually a divider. He makes divisions worse.
The idea he never spoke to the CEO of BP, the idea he only needs to know whose ass to kick is on the face of it the most stupid thing I have heard in a long time.
Very Jimmy "Carteresque". Clearly indicative of incompetence. He claims the buck stops here - except when it comes to taking responsibility.
UK was mad at Bush I guess for getting them into Iraq, Afghanistan.
Well now how do they like Obama now. When push comes to shove the buck is always thrown to someone else from this guy.
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Never send a "community organizer" to do an executive's job, eh Obama-voters?
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Very interesting report on the Bret Baier report last night on FOX. Apparently due to the Jones Act (roughly US water for US flagged ships) there are a bunch of oil skimmer ships that would like to come add to the efforts in the Gulf, but are being denied because the BO people are refusing to exercise their option provided for in the Act of temporarily suspending the Act in the case of emergency e.g. as was done by Bush in the wake of Katrina. Apparent reason? That certain unions don't like this. :x :cry: :x
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A very grim explication of what is likely going on with the spill in the Gulf. Not encountered the source before, but the poster certainly seems authoritative.
http://www.godlikeproductions.com/forum1/message1097505/pg1
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Interested snippet from GM's link, 'a feature, not a bug' link elsewhere:
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"John Hinderaker asks,
If the federal government artificially inflates the price of fossil fuels through taxation and thereby forces Americans to use less desirable sources of energy, while at the same time other countries continue to use more efficient fossil fuels, it will raise the relative price of all American products and devastate our economy. Is it possible that Barack Obama does not know this? I’m not sure; his grasp of even the most basic economic principles seems shaky at best."
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Seriously - as we argue cap and tax etc. - do they know the economic damage it will cause and the global uncompetitiveness it will cause or do they really not know? They incessantly blame manufacturers for leaving the U.S. while they continue to make policies that cause manufacturers to leave. Do they really not know consequences of making energy more expensive and harder to come by?
Some ideas moving forward on energy politics and policy:
a) Go after domestic natural gas sources big time during this pause on deep drilling. CNG (compressed natural gas) has transportation applications, see system in Utah, also CNG/electric hybrids.
b) Start building more nuclear capacity - power the grid, carbon-free but theses plants take a long time to build.
c) Open ANWR and similar fields. Huge capacity, also sends a market signal regarding future capacities.
d) Approve shallow drilling closer to shore. The hole would be plugged, Malia, if we could just go down there.
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9 Important Points about the BP Blowout – Part 1
Written by Allen Gilmer
Tuesday, 15 June 2010 13:53
Here is what a couple of offshore drilling engineers told me about the BP Blowout…
However, everything is consistent with a well way over budget, company men taking heat from the home office to finish the job, and a series of decisions, none catastrophic by themselves, that eventually accumulated to cause this disaster. I have worked with several majors in my career, and the BP/Amoco E&P guys were as good as they come. I can't comment first hand on their drilling engineering practices in general, because I don't know. Here are a few items on THIS well that are notable.
1. On a footage or day rate job, (this was a day rate, reportedly $1 MM/Day), the drilling contractor doesn’t do anything without operator approval or direction.
2. There is no reason to believe the blow out preventer was defective. The probability of a similar result is high for any crew using the same casing and cement program that was used here.
3. The well was drilled to 18,360 ft and final mud weight was 14.0 ppg. The last casing long string was 16 inch and there were 3 drilling liners (13 5/8”, 11 7/8” and 9 7/8”) with 3 liner tops. 16 inches is a massive annulus, with attendant massive forces. A 9-7/8” X 7” tapered casing long string was run to TD. Normal practice would be to run a liner with 9-7/8” liner top packer, followed by tieback string. Perhaps they ran the long string at the last minute to make up for being over time and budget? That would explain why there was no lock ring, since a last minute change would not allow time for fab or prep of a lock ring.
4. Apparently they had indications of mud losses, but efforts to control these were incomplete at best, and perhaps they decided to depend on the cement job to handle this for them.
5. This section of casing was cemented using only 51 barrels of nitrogen-aerated cement, a product choice and volume that seems peculiar and “tricky”. Normal practice would be to pump heavy cement all the way back up to the seabed. Also, why nitrified cement?
6. The casing seal assembly was set in wellhead and pressure tested from above to 10,000 psi. Reportedly, a lock down ring was not run on the 9 7/8” hangar/seal assembly casing hanger, as stated above.
7. After only 16.5 hours after cementing, the casing string was pressure tested against the shear rams. Typically you wait 24 hours before pressure testing, because of the danger of expanding the casing and cracking the cement, causing a pathway up the annulus for gas. Were they trying to get off this hole? A negative test on the wellhead packoff was performed. No cement bond log was run, perhaps to save a few hours of precious rig time.
8. The rig crew HAD to believe that the well was successfully cemented, capped and secured at this point. No one would remove their heavy (14 ppg) drilling mud and replace with seawater if they believed otherwise, and they did so before setting final cement plugs. Yet they did so less than 20 hours after primary cement job. At this point, they had NO effective barriers between reservoir and surface. They should have had at least 2 proven barriers. They chose the fastest way to displace the much with seawater, by pumping sweater down the drill string and sloughing the returns to a work boat, so you lose the benefit of monitoring influx via the pit level. All of this had to be operator mandated.
9. During the displacement failure, the casing collapsed or otherwise failed, causing the well to unload and ignite. According to the first photos, the crew was able to get the diverter closed since flames were shown coming out of diverter lines.
It is likely that pressure built up between the 9 7/8” and 16" casing under the casing hanger. For a mud weight of 14 ppg, the reservoir formation pressure was over 13,000 psi. The pressure differential below the casing hanger would have caused casing to collapse at one of the connections. I have heard speculation that it was one or two joints below the wellhead. This violent production through collapsed casing caused the blowout. Because the hangar didn’t have a lockdown ring, the casing hanger and joint(s) rammed up into the BOP, explaining why the BOP is unable to seal or shear. The parted casing section is probably found up into the riser.
Apparently they showed a bump, or gain in the mud at 8:41 p.m. Had they shut down and closed the pipe rams, they had a good chance of pumping out the gas from the riser in a controlled fashion. They didn’t, and continued pumping for another 30 minutes to disastrous effect.
http://oilprice.com/Environment/Oil-Spills/9-Important-Points-about-the-BP-Blowout-–-Part-1.html
(http://1.bp.blogspot.com/_udSTgadqhFc/S-uAQp9p7jI/AAAAAAAABbg/hQCGgca2Se8/s1600/Deepwater+well+casing.jpg)
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By PAUL H. RUBIN
Destin, Fla.
As the oil spill continues and the cleanup lags, we must begin to ask difficult and uncomfortable questions. There does not seem to be much that anyone can do to stop the spill except dig a relief well, not due until August. But the cleanup is a different story. The press and Internet are full of straightforward suggestions for easy ways of improving the cleanup, but the federal government is resisting these remedies.
First, the Environmental Protection Agency can relax restrictions on the amount of oil in discharged water, currently limited to 15 parts per million. In normal times, this rule sensibly controls the amount of pollution that can be added to relatively clean ocean water. But this is not a normal time.
Various skimmers and tankers (some of them very large) are available that could eliminate most of the oil from seawater, discharging the mostly clean water while storing the oil onboard. While this would clean vast amounts of water efficiently, the EPA is unwilling to grant a temporary waiver of its regulations.
Next, the Obama administration can waive the Jones Act, which restricts foreign ships from operating in U.S. coastal waters. Many foreign countries (such as the Netherlands and Belgium) have ships and technologies that would greatly advance the cleanup. So far, the U.S. has refused to waive the restrictions of this law and allow these ships to participate in the effort.
The combination of these two regulations is delaying and may even prevent the world's largest skimmer, the Taiwanese owned "A Whale," from deploying. This 10-story high ship can remove almost as much oil in a day as has been removed in total—roughly 500,000 barrels of oily water per day. The tanker is steaming towards the Gulf, hoping it will receive Coast Guard and EPA approval before it arrives.
In addition, the federal government can free American-based skimmers. Of the 2,000 skimmers in the U.S. (not subject to the Jones Act or other restrictions), only 400 have been sent to the Gulf. Federal barriers have kept the others on stations elsewhere in case of other oil spills, despite the magnitude of the current crisis. The Coast Guard and the EPA issued a joint temporary rule suspending the regulation on June 29—more than 70 days after the spill.
The Obama administration can also permit more state and local initiatives. The media endlessly report stories of county and state officials applying federal permits to perform various actions, such as building sand berms around the Louisiana coast. In some cases, they were forbidden from acting. In others there have been extensive delays in obtaining permission.
As the government fails to implement such simple and straightforward remedies, one must ask why.
More
As Storm Stalls Cleanup, House Passes Victims' Bill
Florida Sees New Threat to Its Beaches
.One possibility is sheer incompetence. Many critics of the president are fond of pointing out that he had no administrative or executive experience before taking office. But the government is full of competent people, and the military and Coast Guard can accomplish an assigned mission. In any case, several remedies require nothing more than getting out of the way.
Another possibility is that the administration places a higher priority on interests other than the fate of the Gulf, such as placating organized labor, which vigorously defends the Jones Act.
Finally there is the most pessimistic explanation—that the oil spill may be viewed as an opportunity, the way White House Chief of Staff Rahm Emanuel said back in February 2009, "You never want a serious crisis to go to waste." Many administration supporters are opposed to offshore oil drilling and are already employing the spill as a tool for achieving other goals. The websites of the Sierra Club, Friends of the Earth and Greenpeace, for example, all feature the oil spill as an argument for forbidding any further offshore drilling or for any use of fossil fuels at all. None mention the Jones Act.
To these organizations and perhaps to some in the administration, the oil spill may be a strategic justification in a larger battle. President Obama has already tried to severely limit drilling in the Gulf, using his Oval Office address on June 16 to demand that we "embrace a clean energy future." In the meantime, how about a cleaner Gulf?
Mr. Rubin, a professor of economics at Emory University, held several senior positions in the federal government in the 1980s. Since 1991 he has spent his summers on the Gulf.
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Second post of the morning:
Florida has long fought to prevent oil drilling anywhere near its white sandy beaches. But as the state continues to deal with oil from the Gulf of Mexico spill washing up on its shores, it faces a new threat: deepwater drilling in nearby Cuban waters.
Maria Ritter, a spokeswoman for Spanish oil company Repsol YPF SA, said it plans to drill off Cuba, about 60 miles south of Key West, Fla., early next year. If successful, this would likely kick off a spate of exploration. Only one deepwater well has been drilled in Cuban waters, by Repsol in 2004. The effort found oil but not enough to justify commercial development.
Since then, the U.S. Geological Survey has said there could be a substantial amount of untapped oil off the Cuban coast, whetting the appetite of several global oil companies that have signed exploration leases.
U.S. companies won't participate because of a longstanding trade embargo against Cuba. Repsol plans to use a floating drilling rig being refurbished in a Chinese shipyard, similar to the Deepwater Horizon rig leased by BP PLC that caught fire and sank in the Gulf of Mexico in April. Almost all parts and components in the rig to be used by Repsol are from non-U.S. companies.
The Obama administration has sought a six-month ban on deepwater drilling in U.S. waters to reassess risks and establish new safety procedures if necessary. But any new rules wouldn't reach Repsol's project in Cuban waters.
A spill there, even one significantly smaller than the continuing BP spill, could turn into an economic and environmental nightmare for Florida. Some oceanographers say the oil would likely be carried up Florida's Atlantic Coast, the heart of its tourism industry.
"We have one of the world's largest coral reefs and a protected marine sanctuary there," said Dan McLaughlin, a spokesman for Sen. Bill Nelson (D., Fla.) "We should not be drilling there."
Cuba's state oil firm, Union Cuba Petroleo, could not be reached for comment. Ms. Ritter, the Repsol spokeswoman, declined to comment on the project beyond confirming plans for the rig. Repsol has operations in many parts of the world, including the U.S. portion of the Gulf of Mexico.
Drilling off Florida in U.S. waters has been banned by federal moratorium for decades. To protect the state's tourism-based economy, Gov. Charlie Crist, who is running for the U.S. Senate as an independent, is floating a proposal for an amendment to the Florida constitution to ban offshore drilling there permanently.
It's not clear what U.S. or Florida officials could do to stop oil exploration in Cuba. The U.S. controls coastal waters up to 200 miles from its shores, but under a 1977 treaty it agreed to divide the Straits of Florida equally with Cuba. That means Repsol can drill a deepwater well about the same distance from Key West, Fla., as the Deepwater Horizon was from the Louisiana coast.
The rig headed for Cuban waters has five rams in its blowout preventer, each designed to help shut off an out-of-control well. The Deepwater Horizon's blowout preventer had only four.
In the event of a spill in Cuban waters, many ships, equipment and personnel from the U.S. Gulf Coast could be prevented from helping because of the embargo. But that may be changing. A Treasury Department spokeswoman said some U.S. firms involved in oil cleanup have been issued licenses to travel to Cuba in case oil from the continuing spill hits beaches there.
Cuba's efforts to promote offshore oil exploration appear close to paying off. Cuba imports about 110,000 barrels of oil daily and produces an additional 52,000 barrels, mostly from onshore and shallow-water fields, according to the U.S. Energy Information Administration.
Ms. Ritter said Madrid-based Repsol plans to drill a new well near the 2004 well as soon as the rig—called the Scarabeo 9—is ready. Construction of Scarabeo 9 is expected to be complete at the end of 2010 or early 2011, said a spokesman for Enis SpA, an Italian company that controls the rig. Repsol's partners on the well include Norway's Statoil ASA and the overseas arm of India's state-run Oil & Natural Gas Corp. Eight other foreign oil companies hold offshore leases in Cuban waters.
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On the rocky beaches of Alaska, scientists plunged shovels and picks into the ground and dug 6,775 holes, repeatedly striking oil — still pungent and dangerous a dozen years after the Exxon Valdez infamously spilled its cargo.
More than an ocean away, on the Breton coast of France, scientists surveying the damage after another huge oil spill found that disturbances in the food chain persisted for more than a decade.
And on the southern gulf coast in Mexico, an American researcher peering into a mangrove swamp spotted lingering damage 30 years after that shore was struck by an enormous spill.
These far-flung shorelines hit by oil in the past offer clues to what people living along the Gulf Coast can expect now that the great oil calamity of 2010 may be nearing an end.
Every oil spill is different, but the thread that unites these disparate scenes is a growing scientific awareness of the persistent damage that spills can do — and of just how long oil can linger in the environment, hidden in out-of-the-way spots.
At the same time, scientists who have worked to survey and counteract the damage from spills say the picture in the gulf is far from hopeless.
“Thoughts that this is going to kill the Gulf of Mexico are just wild overreactions,” said Jeffrey W. Short, a scientist who led some of the most important research after the Exxon Valdez spill and now works for an environmental advocacy group called Oceana. “It’s going to go away, the oil is. It’s not going to last forever.”
But how long will it last?
Only 20 years ago, the conventional wisdom was that oil spills did almost all their damage in the first weeks, as fresh oil loaded with toxic substances hit wildlife and marsh grasses, washed onto beaches and killed fish and turtles in the deep sea.
But disasters like the Valdez in 1989, the Ixtoc 1 in Mexico in 1979, the Amoco Cadiz in France in 1978 and two Cape Cod spills, including the Bouchard 65 barge in 1974 — all studied over decades with the improved techniques of modern chemistry and biology — have allowed scientists to paint a more complex portrait of what happens after a spill.
It is still clear that the bulk of the damage happens quickly, and that nature then begins to recuperate. After a few years, a casual observer visiting a hard-hit location might see nothing amiss. Birds and fish are likely to have rebounded, and the oil will seem to be gone.
But often, as Dr. Short and his team found in Alaska, some of it has merely gone underground, hiding in pockets where it can still do low-level damage to wildlife over many years. And the human response to a spill can mitigate — or intensify — its long-term effects. Oddly enough, some of the worst damage to occur from spills in recent decades has come from people trying too hard to clean them up.
It is hard for scientists to offer predictions about the present spill, for two reasons.
The ecology of the Gulf of Mexico is specially adapted to break down oil, more so than any other body of water in the world — though how rapidly and completely it can break down an amount this size is essentially unknown.
And because this spill is emerging a mile under the surface and many of the toxic components of the oil are dissolving into deep water and spreading far and wide, scientists simply do not know what the effects in the deep ocean are likely to be.
Still, many aspects of the spill resemble spills past, especially at the shoreline, and that gives researchers some confidence in predicting how events will unfold.
Remarkable Persistence
In 1969, a barge hit the rocks off the coast of West Falmouth, Mass., spilling 189,000 gallons of fuel oil into Buzzards Bay. Today, the fiddler crabs at nearby Wild Harbor still act drunk, moving erratically and reacting slowly to predators.
The odd behavior is consistent with a growing body of research showing how oil spills of many types have remarkably persistent effects, often at levels low enough to escape routine notice.
Jennifer Culbertson was a graduate student at Boston University in 2005 when she made plaster casts of crab burrows. She discovered that instead of drilling straight down, like normal crabs, the ones at Wild Harbor were going only a few inches deep and then turning sideways, repelled by an oily layer still lingering below the surface.
Other researchers established that the crabs were suffering from a kind of narcosis induced by hydrocarbon poisoning. Their troubles had serious implications for the marsh.
“Fiddler crabs normally play a crucial role in tilling the salt marsh, which helps provide oxygen to the roots of salt marsh grasses,” Dr. Culbertson said about her study.
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In Alaska, the Exxon Valdez spill dumped nearly 11 million gallons of oil into Prince William Sound, and it spread down the Alaska coast, ultimately oiling 1,200 miles of shoreline. By the late 1990s, the oil seemed to be largely gone, but liver tests on ducks and sea otters showed that they were still being exposed to hydrocarbons, chemical compounds contained in crude.
Multimedia
Dr. Short, then working for the National Oceanic and Atmospheric Administration, mounted a series of excavations to figure out what had happened, with his team ultimately digging thousands of holes in Alaska’s beaches. Oil was found in about 8 percent of them, usually in places with too little oxygen for microbes to break it down.
Exactly how much damage continues from the oil is a matter of dispute, with Exxon commissioning its own studies that challenge the government’s findings on the extent of the impact. But it is clear that otters dig for food in areas containing oil, and that they, like nearly a dozen other species of animals, have still not entirely recovered from the 1989 spill.
At the rate the oil is breaking down, Dr. Short estimates that some of it could still be there a century from now.
Increasing the Stress
Perhaps the greatest single hazard from the Deepwater Horizon disaster in the gulf is the long-term erosion of delicate coastal wetlands it could cause. At another spill site on the Massachusetts coast, not far from the West Falmouth spill, the legacy of oil contamination is evident in the difference between two marshes on either side of a pebbly shoreline road.
On one side, where the marshes were suffused in 1974 when the grounded Bouchard 65 barge dumped 11,000 to 37,000 gallons of fuel oil into the sea, the grasses are stunted and sparse. They cling tentatively to the edge of the sandy beach. But the grasses on the other side, untouched by oil, rise tall and thick.
Louisiana’s coastline contains some of the most productive marshes in the world, delivering an abundance of shrimp and oysters and providing critical habitat and breeding ground for birds and fish.
But even before the spill, the land was under enormous environmental stress, largely due to human activity. Dams on the Mississippi River and its tributaries have slowed the flow of sediment to the marshes, and global warming has caused sea level to rise.
The Louisiana marshes are eroding at an extraordinary rate — a football field’s worth sinks into the Gulf of Mexico every 38 minutes, according to the Louisiana Office of Coastal Management — and the worry now is that the oil spill will accelerate that erosion.
The Bouchard shows how that could happen. When the barge ran aground, thousands of gallons of a particularly toxic fuel oil spilled into the icy water and were swept to shore by the strong tides.
The oil made landfall just two miles north of where the West Falmouth oil spill had washed up only five years earlier. Winsor Cove, a classic New England bay surrounded by bluffs and stately homes, bore the brunt. Razor clams suffocated and rose to the surface by the hundreds to die.
But the lasting damage of the spill, severe erosion of the shoreline, took months longer to unfold.
George Hampson, now retired, was on the scientific team at the Woods Hole Oceanographic Institution that studied a series of spills in the area. He recalled that after the 1974 spill the beach grasses, called spartina, which had grown like luxuriant matting along the shore, died.
“The first year it was just like a moonscape,” Mr. Hampson said.
Spartina, a common beach grass that fills the marshes along the North Atlantic and in the Gulf of Mexico, is a crucial factor in keeping marshlands from eroding into the sea. Its roots act as a vast net keeping soil in place.
But the oil in Winsor Cove set off a vicious downward spiral. “It was a race between how much peat was eroding and how quickly the grass was coming back,” Mr. Hampson said.
Over the course of the next several winters, six feet of shore eroded, including a sand berm that stood above the rest of the beach. And as the view from the pebbled road indicates, the vegetation still struggles for a foothold today.
“It’s been 35 years, and I’d say the grasses are just beginning to grow back,” Mr. Hampson said.
It is certain that some of the heavily oiled spartina in Louisiana will die. For now, heavy oiling is limited to just the marsh fringes, but a strong surge in front of a hurricane could change that.
Bad Choices
Oil spills produce a powerful impulse to clean up the oil and restore as much of the environment as possible. But that impulse can itself be a source of destruction.
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Page 3 of 4)
No case illustrates that point more starkly than the 1978 spill of the Amoco Cadiz tanker. Caught in a gale, it was propelled against rocks near the shore of northwestern France, spilling 67 million gallons of crude oil that washed over 200 miles of the coast of Brittany.
The immediate damage was bad enough: at least 20,000 seabirds found dead, thousands of tons of oysters lost and fish ridden with ulcers and tumors. But then the French authorities made it worse.
The area had marshes, and they were hit hard by oil that sank deep into the sediments. The authorities felt they needed to act aggressively.
Using bulldozers and tractors, they scraped close to 20 inches of oiled sediment from the top in the most polluted marshes and also straightened and deepened some natural tidal channels, to improve flushing.
Over time, these proved to have been disastrous judgments.
In areas that were not bulldozed, nature ultimately broke down most of the oil and the vegetation came back. But marsh plants turned out to be highly sensitive to the depth of the sediment, and more than a decade after the spill, the bulldozed marshes are still missing as much as 40 percent of their vegetation.
“In the case of Amoco Cadiz, the cleanup operations were more deadly than the pollution itself,” said Jean-Claude Dauvin, a professor of marine biology and ecosystems at the University of Lille in northern France.
Much the same dynamic played out in Alaska after the Exxon Valdez spill. In some areas, Exxon power-washed oiled beaches with high-pressure, hot-water sprayers. It made for dramatic television images, with the company seemingly working hard against the spill. But scientists ultimately determined that it was a disaster for the tidal ecology, with clams and other organisms showing greatly delayed recovery on the laundered beaches, compared with oiled beaches that were not cleaned.
The lesson, scientists say, is not that people should never try to clean up an oil spill. It is possible to do too little as well as too much. But the calculation of how much to do is tricky, demanding deep scientific understanding of an area’s ecology. Applying supposed common sense has repeatedly led to mistakes.
Already in Louisiana, battles have erupted between the Army Corps of Engineers and local residents, led by Gov. Bobby Jindal, over proposals to build sand and rock barriers to block the oil from coming into the marshes. The corps has been cautious on approval permits and recently rejected a plan to build a rock barrier outside Barataria Bay, arguing that such structures would change water-flow patterns to the possible detriment of the marsh ecology.
No matter how that battle plays out, a tough and potentially contentious issue in Louisiana in coming months may be the question of whether the marshes should be burned.
If the top layer of grasses and the clinging oil are burned off, the roots should survive and allow healthier grasses to sprout back. But scientists say that can be done only if there is no chance of new oil coming in, since burning might expose the roots buried in the sediment, making them vulnerable to absorbing the oil. Given the immensity of the spill, it is not clear when that hazard will have passed.
“If you consider the volume,” said Ronald J. Kendall, chairman of environmental toxicology at Texas Tech University, “we could see re-oiling for years to come.”
Natural Resilience
The other day, a Mexican fishing boat threaded its way deep into a coastal mangrove swamp on the Bay of Campeche. It carried two scientists, an American, Wes Tunnell, and a Mexican, Julio Sánchez.
They were looking for remnants of an oil spill that happened 30 years earlier, when the Ixtoc 1 well in the bay exploded and gushed oil for 10 months. It has stood for decades as the worst accidental release of oil in any ocean. (It may or may not have been surpassed by the BP spill; estimates vary.)
Mangroves are vital coastal plants, providing rich habitat for many types of creatures and serving as a nursery for many marine species. To the untrained eye, the ones in Mexico appeared healthy, billowing up from the shoreline in shades of green, balanced on a gray carpet of roots that protruded from the water.
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But Dr. Tunnell pointed out subtle signs of damage. There were clearings in the foliage, instead of an unbroken tangle of roots and mangrove trees. The branches of the outer layer of red mangroves seemed stunted.
“For a mangrove swamp, this should be much denser,” Dr. Tunnell said. “We shouldn’t even be able to see in here.”
The scientists scrambled out of the boats to a small clearing. Dr. Sanchez bent down, sliced out a layer of sediment and broke it to reveal gooey tar in the middle.
Dr. Tunnell sniffed. “It smells like a newly paved road,” he said.
They could not be sure it was oil from the Ixtoc well, since smaller spills have hit the area too, but the scientists agree with local fishermen that much of the damage to the mangroves goes back to Ixtoc.
They sent the sample to a laboratory. The fishermen also said that oysters that used to be found clinging to the mangrove roots seemed to have vanished after the spill and never returned.
The Ixtoc blowout of 1979-80 is the closest analogy to the BP spill, even though it happened in much shallower water. Ixtoc soiled hundreds of miles of beaches, all the way to Texas.
Dr. Tunnell, of the Harte Research Institute for Gulf of Mexico Studies at Texas A&M, Corpus Christi, was early in his career then. He was dismayed to see the oil kill 50 percent to 80 percent of the bottom-dwelling creatures in some areas near the Texas shore.
“As a young scientist, I thought, ‘Oh, no, this is wiping out our beaches,’ ” Dr. Tunnell said.
But then he watched in amazement as the recuperative powers of the gulf kicked in.
Because oil constantly seeps into the gulf from natural fissures, the water is teeming with microbes adapted to break oil down and use it as food. The breakdown happens faster there than in colder bodies of water, and the warm water helps some species recover faster, too.
Along the Texas coast, within a few years after the Ixtoc spill ended in 1980, it was hard to tell that anything had gone wrong. Creatures repopulated the areas that had been wiped out.
No one can be sure that the recovery from the BP spill will be a replay of Ixtoc. But the greatest reason for optimism is nature’s demonstrated capacity to handle the assaults on it.
“Thirty years ago, that 140 million gallons of oil went somewhere,” Dr. Tunnell said. “The gulf recovered and became very productive again. My concern is: Is it as resilient today as it was 30 years ago?”
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Too much of a good thing: Growth in wind power makes life difficult for grid managers
Published: Saturday, July 17, 2010, 10:00 AM Updated: Saturday, July 17, 2010, 8:45 PM
Ted Sickinger, The Oregonian
Benjamin Brink/The Oregonian
The fast-growing number of wind farms in the Northwest, such as the Biglow Canyon Wind Farm near Rufus, has created new challenges for those who manage the power grid.
On the afternoon of May 19, in a single chaotic hour, more than a thousand wind turbines in the Columbia River Gorge went from spinning lazily in the breeze to full throttle as a storm rolled east out of Hood River.
Suddenly, almost two nuclear plants worth of extra power was sizzling down the lines -- the largest hourly spike in wind power the Northwest has ever experienced.
At the Bonneville Power Administration's control room in Vancouver, it was too much of a good thing. More electricity than its customers needed. More than the available power lines could export from the region. And more than the grid could readily absorb by ramping down generation at the region's network of federal dams.
So the edict went out: Feather your turbine blades; slash output.
It was an unwelcome instruction for wind farm owners, whose economics depend on generating electricity whenever possible. Yet it's one likely to go out with increasing frequency.
During the last three years, the building boom spawned by green energy mandates in Oregon, Washington and California doubled the generation capacity of wind farms in the region. By 2013, it's expected to double again.
That seems like great news. Plenty of carbon-free energy with no fuel costs. Jobs. Property taxes.
In the real world, however, the pace and geographic concentration of wind development, coupled with wild swings in its output, are overwhelming the region's electrical grid and outstripping its ability to use the power or send it elsewhere.
In theory, better coordination of the balkanized grid operations around the west could help solve the problem, reducing costs, eliminating bottlenecks and solving scheduling conflicts that plague the system today.
In practice, however, those efforts have often stalled at the planning stage -- the victim of risk-averse engineers, utility managers or public utility customers worried about seeing their rates increase.
It's not a new problem. But the renewables explosion, and pressure to reduce carbon emissions, is forcing the transmission issue to center stage now.
"There's a sweet spot to talk about these issues, and everyone's attention is on this at the moment," said Rachel Shimshak, executive director of the Renewables Northwest Project. "Maybe the benefits didn't look so obvious before, but now we have a lot more people with skin in the game."
The most significant player in that crowd is California, which already buys much of the Northwest's wind energy, but has trouble getting it delivered over clogged interstate power lines. The state has just increased its already aggressive renewable energy standards, increasing its appetite for green power.
Ultimately, the solution to the problem is to beef up or build new power lines, said Randy Hardy, a Seattle-based energy consultant. But that's a five to ten year proposition, involving even more coordination on what to build, where to put it and who pays.
"We have a next-year problem," Hardy said, "or maybe a this-year problem."
Only 15 percent of the electricity generated by wind farms in the Northwest goes to the public utilities that buy power directly from BPA, which sells power from federal dams in the Columbia Basin. But the federal power marketing agency manages three quarters of the region's high voltage transmission system, including the sections serving most of the region's wind farms.
That makes it BPA's job to balance their up-and-down output, blending it with other sources of power so total generation at any given time matches total demand -- a requirement to maintain grid reliability.
The dams are great for the job -- operators can adjust water flows through the turbines to help offset variable wind output.
But only within limits.
As the region's wind fleet grows, an ever bigger slice of the hydro pie is being reserved to fill in when the wind doesn't blow as scheduled. That means foregone sales of surplus power, a source of revenue that reduces BPA's rates for public utility customers.
When the wind blows harder than forecast, particularly during periods of high spring runoff at the dams, operators face the opposite problem. They can't bypass the dam turbines to lower hydro generation, because dumping too much water over the spillways harms fish.
So the other option is to cut generation at the wind farms.
Too many curtailments, however, undermines the economics of wind, not only because turbines generate less power to sell but because valuable tax and renewable energy credits are only generated when their blades are spinning.
"We are committed to trying to find ways to get as much wind into the system as possible, but we're going to be real sticklers about reliability, and we think its it's not fair to have a cost shift," said Elliott Mainzer, BPA's director of strategic planning
BPA does charge wind farms to offset the additional costs they bring to the system. But those charges have been highly contentious.
Last year, when the agency proposed quadrupling its “integration” rate, Oregon’s congressional delegation took up the wind developers’ fight, accusing the agency of dragging its feet on renewables and focusing solely on maintaining low rates for its public utility customers. Sen. Ron Wyden was highly critical of the agency’s attitude problem, and Rep. Earl Blumenauer even suggested it might be time for new leadership at the agency.
BPA ultimately backed away from the big rate increase. But it is coming up again this year as the agency kicks off a new rate-setting process.
Meanwhile, it has pushed ahead with a variety of efforts to accommodate more variable resources, from better wind forecasting to more flexible scheduling of transmission.
In extreme situations, however, the agency continues to dump wind.
At the current rate of wind development, says the BPA's Mainzer, the region's system of dams and power lines will start running into consistent operational problems around 2013, when wind in the agency's territory reaches total capacity of some 6,000 megawatts.
Above and beyond that, he said, will require major structural changes.
"If it's done right, he said, "it's a huge opportunity for the Northwest."
The solution, most experts believe, lies in better coordination of power plants across the west, more efficient use of existing power lines and some expansion of the grid.
"We believe there's more space on the lines if we get smarter about how we use them," said John Audley, deputy director at the Renewables Northwest Project. "But there isn't anyone out there who feels we have enough transmission in place to get what we need done."
Building new transmission, though, is an uphill battle. New lines often require new rights of way through sensitive habitat and private property. And they are phenomenally expensive, raising the show-stopping question of who pays.
BPA has had some success convincing wind developers and other transmission customers to commit to helping fund new power lines and upgrades within the region.
"The piece that is not doing well is planning for moving wind out of the region," said Brian Silverstein, senior vice president of transmission services for BPA. Ultimately, he said, "we can plan all we want. The challenge is getting people to commit to the investment."
There's a broad-based effort to get more out of the existing lines, too.
The capacity of power lines linking Oregon and California, for instance, is completely booked long term. But on a day-to-day basis, utilization can be lower than 50 percent.
Part of the problem is that utilities buy more capacity than they need, and hoard it for emergencies. If that capacity can be freed up, BPA estimates the lines could transfer 10 to 15 percent more power.
Another issue is that utilities are required to reserve line capacity an hour ahead of time. By allowing them to adjust their orders more frequently, utilities could accommodate unanticipated ebbs and flows in wind generation and maybe free up another 25 to 30 percent of capacity on the power lines.
But none of those changes come quickly, easily or cheaply. Utility managers, renewable developers, customer advocates and environmentalists met last week in Portland for a day-long seminar on expanding and modernizing the grid to accommodate renewables.
There was a definite sense of urgency in the air. But also determination.
"We can't pay for everything at once, and we don't want to pay for everything on the table," said Jeff Bissonnette, a lobbyist for the Citizen's Utility Board of Oregon. "We have to figure out what makes sense to pay for first, second and third, and what makes sense for consumers and the environment."
-- Ted Sickinger
http://www.oregonlive.com/business/index.ssf/2010/07/too_much_of_a_good_thing_growt.html
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Not in a position to evaluate this piece, but it appears well reasoned. Wish the author had included his quals, but if he's right it's a damning piece.
Steven Chu's Snake Oil
Bruce Thompson
You probably have been hearing a lot of nonsense lately about the integrity of BP's Macondo well casing. A lot of it has been coming from those who ought to know better, specifically including Energy Secretary Chu. Click here for a copy of the well diagram saved from the DOE website. I recommend that you print it out to follow along. What we will look at is on the left hand side of the page. (Here's the link: http://www.americanthinker.com/blog/DOE%20Well%20Configuration%20as%20of%207-5-10.pdf BbG)
Starting at the top it says "ML @ 5067'MD/TVD". Translating, it means Mud Line @ 5,067' Measured Depth/Total Vertical Depth.
Next it says "16" supplemental adapter @ 5227' in 22" extension joint 18".375" ID (1.25" wall pipe above" - That is the "hanger" for the 16" casing. Just below the hanger, if you look at the wall itself, you will see a dark vertical line on the outside (the 36" casing), a gray band (cement), another dark vertical line (the 28" casing), more cement, a third dark line (the 22" casing), a white space (the annulus between the 22" and 16" casings), another black line which is the 16" casing and then another white space with the number "14" which is the annulus between the 16" casing and the 9-7/8" production casing which is shown filled with blue (sea water).
Next is the bottom of the 36" casing at 5,312' MD/TVD (254' bml [below mud line])
Now we get to the first of Dr Chu's screwups, the "16" rupture/burst disk sub". .We will return to the subject of rupture disks shortly.
Next it says "TOC @ - 5067' MD/TVD (mudline)" which means the Top Of Cement is at the mud line. The bottom of that cement job is shown next at "28" @ 6217' MD/TVD (1150' bml)". So the 28" casing is cemented all the way along its length from 5067' down to 6217'.
Next comes a reference to the internal drill pipe (567' MD - Bot of 5-1/2" 21.9 ppf S-135 (3450' of pipe")) which we can ignore because it has nothing to do with the integrity of the casing.
Next is another "TOC 2 - 5067' MD/TVD (mudline) indicating that the 22" casing is also cemented all the way up to the mud line. So if the casing were to fail at the surface around the Blowout Preventer (BOP), it would have to rupture through three thicknesses of casing (36", 28" & 22"), plus the two layers of cement. And if it were more than 160 feet below the mud line (5227 - 5067 =160) you can add the 16" casing too. Relax Dear Readers, the well is intact near the mud line.
Now please note that the 16" casing goes all the way down to 11,585', a distance of 6518' below the mud line and is cemented up to about 10,500 feet. Therefore, it has over 1000 feet of cement between its lower end and the rough well bore.
The production casing is described on the right side of the page near the bottom "7' 32# x 9-7/8" 62.8). Deciphered that means the lower part of the production casing, which goes down to 18,114.93' MD, is 7 inches in diameter and weighs 32 pounds per foot. It transitions ("XOVER" AKA crossover) to a 9-7/8" diameter, 62.8 pounds per foot pipe at 12,487.64'.
Now let us come back to the rupture disks. You'll see there are three shown at 6047', 6304' and 9560'. They are all shown as 16" disks. You may ask how does Dr Chu get 16" rupture disks into a 9-7/8" production casing? OOOOPS. Actually, the rupture disks are very small and are placed in threaded holes through the collars that are used to screw sections of 16"casing together. I do not know the manufacturer of the disks, but since I sell rupture disks in my day job, I'll use some of my manufacturer's literature to explain what is going on.
Here is the link. Given that it is installed using a "1/4" hex bit socket" it is a very small device. It is screwed into the collar from the ouside so that the flow is directed inward. As noted above, there is drilling mud between the 16" casing and the casings outside it. That mud is in contact with the surrounding rock which varies in temperature from 48 degrees F at 5,312 feet to 262 degrees F at 18,360 feet. As the ground heats the mud it will expand. If it expands too much, it will create a pressure on the outside of the 16" casing trying to implode the 16" casing. So the rupture disks are intended to provide thermal relief of that annular space around the 16" casing. The casing is under more threat of implosion than explosion.
So Dear AT Readers, don't believe the government when they try to sell you Doctor Chu's Snake Oil that the well lacks pressure integrity above 11,153 feet total vertical depth. In fact the most likely place where the well has failed is through the cement shoe between the "Top Float Collar 18,11.93 MD" the "7" Shoe @ 18,303.92' MD".
BTW - I see that the New York Times has re-written its puff piece on Dr Chu from last Saturday to delete this passage:
His role gradually deepened as he assembled a team of scientists from the Department of Energy laboratories, universities and other government agencies. By late May, his confidence had grown and he was giving orders to BP officials, including his demand to stop the top kill effort even though some BP engineers believed it could still succeed.
"A lot of us said ‘don't start it,' and he was the one who said ‘stop,' " said a BP technician who was granted anonymity because he was not authorized to speak for the company. "But having done all we had already done, I thought we should have completed the final two operations. He was not keen to listen. BP people said, ‘Let's try these last two steps,' but he said, ‘No, stop.' "
That's right Dear Readers. If Dr Chu had kept his mouth shut, BP's top kill probably would have succeeded and the damn hole would have been plugged by Memorial Day. More oil may have fouled the Gulf of Mexico because of Steven Chu than because of BP!
Page Printed from: http://www.americanthinker.com/blog/2010/07/stephen_chus_snake_oil.html at July 19, 2010 - 11:43:20 AM CDT
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Woof,
Finally our little chameleon Republicans are turning back to their Conservative colors after feasting on taxpayers money and doing their best to destroy our Constitutional Republic along with their Liberal friends pushing through a socialist agenda. I wonder what triggers such a transformation? It couldn't possibly be that an election is coming could it? And I wonder, if reelected, how long will it take for them to change back again? I don't like questioning the intelligence of voters but if the Republicans in the states these people represent are so dumb that this little trick keeps fooling them into voting for them time after time, then they need to start doing scans at the polls just to make sure these aren't brainless zombies voting instead of rational humanbeings. :-P
www.news.yahoo.com/s/ap/20100722/ap_on_bi_ge/us_senate_energy
P.C.
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A Call for Energy Realism
The fossil-fuel economy won’t disappear anytime soon.
In the summer of 2008, at a time of widespread anger over historically high oil prices, Al Gore challenged his countrymen “to commit to producing 100 percent of our electricity from renewable energy and truly clean carbon-free sources within ten years.” This wildly ambitious goal recalled Richard Nixon’s proclamation, issued amid the 1973 global oil shock, that the United States would aim to become fully energy independent by 1980. It also brought to mind Jimmy Carter’s pledge, made during his famous 1979 “malaise” speech, that America would “never use more foreign oil than we did in 1977,” and would seek to cut its reliance on imported oil in half by 1990. For those keeping score, foreign oil accounted for 35 percent of U.S. consumption in 1973 — and 63 percent in 2009.
As University of Manitoba professor Vaclav Smil writes in his new book, Energy Myths and Realities, the various targets proposed by Nixon, Carter, and Gore collided with the harsh reality that “energy transitions are inherently prolonged affairs lasting decades, not years.” It was probably not until the late 1890s, he notes, that fossil fuels provided half of all global energy. While we commonly think of the 1900s as the “oil century,” oil did not become the world’s largest primary energy supplier until 1965; and during the 20th century as a whole, it contributed slightly less energy than coal did.
“In global terms,” says Smil, “1800–1900 was still a part of the millennia-long wooden era, and 1900–2000 was (albeit by a small margin) the coal century.” Commercial oil production started in the 1860s, but it took roughly eight decades for the black stuff to gain even a quarter of the global primary energy market. As for the U.S. market, coal became America’s biggest primary energy supplier in 1885, Robert Bryce writes in Power Hungry, and it held that crown for 75 years. In the 1910s and 1920s, its domestic market share reached as high as 90 percent. Oil did not surpass coal as the top U.S. supplier until 1950; its rise was driven largely by the automobile revolution and military needs during World War II.
By 1958, natural gas had eclipsed coal to become America’s second-largest primary energy source, says Bryce, managing editor of the online journal Energy Tribune and a Manhattan Institute senior fellow. But then, regulatory interventions hindered its growth and gave new life to the U.S. coal industry. In recent years, coal demand has been soaring in China, India, and other developing countries. Smil points out that coal’s portion of the global primary energy market was higher in 2008 than it was in 1973. Over the next 20 years, those hoping for a decline in worldwide coal consumption will almost certainly be disappointed.
Just look at the International Energy Agency projections. In its latest “World Energy Outlook,” released in November 2009, the IEA estimated that, if government policies stayed constant, global demand for coal would increase by 53 percent between 2007 and 2030. Over the same period, coal’s share of global electricity generation would swell from 42 percent to 44 percent, while that of renewable fuels would go from 18 percent to 22 percent. Total energy-related carbon-dioxide emissions would jump by 40 percent, with coal-power emissions growing by 60 percent. Coal would still be “the dominant fuel of the power sector,” and fossil fuels generally would still be “the dominant sources of energy worldwide.”
They will also remain the dominant sources in America. The U.S. Energy Information Administration reckons that, based on current government policies, fossil fuels will account for 78 percent of overall U.S. energy use in 2035, compared with 84 percent in 2008. Coal will provide 44 percent of U.S. electricity generation (down from 48 percent in 2008), and renewables will provide 17 percent (up from 9 percent in 2008). To be sure, the extension of certain tax subsidies and the establishment of muscular greenhouse-gas regulations by the Environmental Protection Agency could boost the market share of renewable technologies and further reduce America’s dependence on fossil fuels. But even if the U.S. launches an aggressive renewable-energy drive, its reliance on oil and coal will persist well into the future.
Indeed, the promise of renewables has consistently been oversold by the political class. Solar and wind energy both suffer from major structural deficiencies. As Bryce observes, they are “incurably intermittent” and very difficult to store, and have low power density. Because of their low density, solar and wind “require huge swaths of land — which often becomes unusable for other purposes.” Smil offers a balanced assessment of wind power: “Conversion of wind’s kinetic energy by large turbines can become an important contributor to the overall electricity supply, but, except for relatively small regions, it cannot become the single largest source, even less so the dominant mode of generation.”
Compared with solar and wind, nuclear and natural-gas energy boast much higher power density and can deliver far greater capacity. Bryce argues that they are the true “fuels of the future,” though he concedes that nuclear plants are extremely costly to build and take a long time to become operational. Therefore, he urges a short-term expansion of natural-gas production and a long-term transition to nuclear. While Smil predicts that “an early and substantial nuclear comeback is unlikely either in North America or in Europe” — partly for economic reasons, and partly because of perennial concerns over plant safety and the disposal of radioactive waste — he affirms that “nuclear generation is the only low-carbon-footprint option that is readily available on a gigawatt-level scale.”
Even if previous energy transitions moved at a slow, incremental pace, might we be able to accelerate them in the years ahead? Smil acknowledges that we now “possess incomparably more powerful technical means to effect faster energy transitions than we did a century or a half century ago.” But there is a crucial caveat: “We also face an incomparably greater scale-up challenge. While the shares of new energies in the global or the U.S. market remain negligible, the absolute quantities needed to capture a significant portion of the total supply are huge because the scale of the coming global energy transition is of an unprecedented magnitude.”
Over the next few decades, he explains, replacing half of all fossil-fuel energies with renewable energies would mean replacing the equivalent of approximately 4.5 billion tons of oil. This would effectively require “creating de novo an industry whose energy output would surpass that of the entire world oil industry that took more than a century to build.” Smil also addresses the ten-year plan laid out by Al Gore: Even if America had the necessary high-voltage transmission interconnections, it would entail the construction of 1,740 gigawatts of new wind- and solar-power capacity — in other words, “1.75 times as much as [America] built during the past fifty or more years.”
Our current national energy debate is heavy on passion and hyperbole; it could use a sizable dose of historical perspective and empirical reality. In that sense, Smil and Bryce have done a valuable service. Their new books should be mandatory reading for U.S. policymakers.
— Duncan Currie is deputy managing editor of National Review Online.
http://article.nationalreview.com/438934/a-call-for-energy-realism/duncan-currie
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http://reason.com/blog/2010/08/06/epa-dont-mess-with-texas-green
Reason Magazine
EPA: Don't Mess with Texas' Greenhouse Gases
Ronald Bailey | August 6, 2010
Congress has failed to adopt any program to regulate greenhouse gas emissions. However, the Supreme Court ruled in 2007 that the Environmental Protection Agency had the authority to regulate greenhouse gases under the Clean Air Act. So now the EPA is ordering the states to devise regulations that comply with the EPA's new greenhouse gas emissions limits. If a state fails to do so, the agency will impose a Federal Implementation Plan on the state and issue emissions permits itself. In addition, the EPA decided to regulate only facilities that emit 75,000 tons of greenhouse emissions per year.
Now the Texas attorney general and the head of the state's Commission on Environmental Quality are telling the EPA to back off [pdf]. Among other things, Texas officials assert that the EPA's January 2, 2011 deadline for enacting regulations that conform to the EPA's plans is a hustle that violates its own rulemaking provisions that allow much more time for deliberation. In addition, the Texas officials are arguing that the EPA is further violating the Clean Air Act which requires the agency to regulate facilities that emit more 100 to 250 tons of specified pollutants, not just those that exceed a threshold of 75,000 tons. In this case, Texas is calling the EPA's Clean Air Act bluff because at 100 to 250 tons per year, the agency would have to regulate more than 6 million facilities instead of fewer than 1,000.
If Texas prevails in the federal courts, that would mean that the U.S. would have no federal program regulating greenhouse gas emissions.
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U.S. Backs $1B Loan to Mexico for Oil Drilling Despite Obama Moratorium
Published September 11, 2010
Despite President Obama's moratorium on U.S. deepwater drilling in the Gulf of Mexico, the U.S. Export-Import Bank intends to guarantee $1 billion in loans to PEMEX, the Mexican state oil company, to bolster the company's oil drilling in the region.
The bank, which is the official American export credit agency, loaned more than $1 billion to PEMEX in 2009 -- when the company was the bank's largest borrower -- in support of its drilling activities. That year, the bank also guaranteed two loans totaling $300 million made by a commercial lender.
The latest request comes during a drilling moratorium that was first imposed by Obama in May to find out what was the cause behind the April 20 Deepwater Horizon oil rig explosion killed 11 workers and led to 206 million gallons of oil spewing from BP's undersea well.
After a federal court struck down the ban amid complaints that it threatened thousands of jobs in the offshore oil industry, the Obama administration issued a new moratorium in July on most deep-water drilling activities that is in effect until Nov. 30.
The Export-Import Bank said the moratorium doesn't affect its pending deal with PEMEX.
"None of these projects involve deepwater drilling," bank spokeswoman Maura Policelli told FoxNews.com in an e-mail.
The $1 billion deal is awaiting approval by the bank's board, which is expected to reach a final decision by Sept. 30, the end of the fiscal year. Because the bank is an independent agency, the deal is not subject to congressional approval.
"Before deciding whether to approve applications for financing, Ex-Im Bank performs rigorous environmental, safety and financial due diligence activities, including on-site inspections" Policelli said.
"After financing is approved, the bank monitors the company's financial, environmental and safety activities and performs on-site inspections as often as twice a year," she said.
The 2010 request will support multiple PEMEX projects, including offshore drilling and a $200 million facility to finance sales to U.S. small businesses, Policelli said.
By law, the bank's financing is "directly tied to the export of goods and services produced or provided by American workers," Policelli said.
Since 1998, the bank has guaranteed $7.7 billion in loans that U.S. and international banks have made to PEMEX. The bank agreed to make the direct loan of $1.05 billion to PEMEX last year in the wake of the financial crisis when commercial lenders tightened their lending.
"This loan supported the purchase of U.S. goods and services," Policelli said.
Over that 12-year period, Policelli said, the bank's financing of PEMEX has "helped create or sustain the jobs of over 47,000 American workers at over 1,300 U.S. companies, including 915 small businesses and 400 large companies."
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Obama has got to spread the wealth around, just as he told JTP.
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Woof,
The wealth spreading is bad enough but the way he's doing it also weakens our power and ability to recoup and build wealth, and in that way he is contributing to our demise. :-P
P.C.
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Obama believes, like much of the left, that America should be just another country. No richer, or more powerful than any other. He also believes that the wealth and power we have we got unfairly, so it's only fair to spread it around.
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http://reason.com/archives/2010/09/17/burning-money-to-turn-coal-int
Reason Magazine
Burning Money to Turn Coal into Gas
In which Science Correspondent Ronald Bailey confesses to his role as a petty Igor to Jimmy Carter's energy-regulating Dr. Frankenstein.
Ronald Bailey | September 17, 2010
North Dakota is all about energy production. The landscape in the Peace Garden State is thick with rocking oil derricks and its byways are clotted with oil tanker trucks. When one drives in at night from the west, Highway 83 just south of Minot is bordered with wind turbines whose string of eerie red airplane-warning lights look like a picket line of giant alien sentries 20 miles out. The hydroelectric Garrison Dam blocking the Missouri river is a graceful feat of engineering and the countryside is dotted with electric power generation plants rising on the prairies from the middle of vast open pit coal mines.
But for me, the most interesting feature of North Dakota’s energy landscape is the Great Plains Synfuels plant located near the town of Beulah, just south of Lake Sakakawea. “If you want to see what $4 billion can build in the middle of the prairie,” says Basin Electric communications director Darrell Hill, “it’s the Great Plains and the Antelope Valley electric station next door to it.” And the two are indeed an impressive sight. From a distance the gigantic coal gasfication plant with its enormous smokestacks billowing white clouds is an easy stand-in for William Blake’s “dark satanic mills.” That is until you learn that the Great Plains billows are essentially steam.
Why did I particularly desire to visit the Great Plains Synfuels plant? I have some small bit of personal history with it. Back in the late 1970s and early 80s, I was a low level federal natural gas regulator and a peripheral member of the team that was guiding the plant’s initial development at the Department of Energy (DOE). I functioned as a petty Igor to President Jimmy Carter’s energy Dr. Frankenstein. I was eager to see up close what I helped in some minor way bring to life. But besides my personal history, the Great Plains Synfuels plant stands as a very apt cautionary tale about massive energy projects promoted and financed by visionary presidents and their equally visionary helpmeets in Congress and in the federal energy bureaucracies.
The Great Plains Synfuels plant is a monument to our ancient Me Decade fears about foreign oil and impending energy shortages. The plant was a public/private project that aimed to demonstrate the commercial feasibility of turning copious quantities of lignite (the least energy dense form of coal) into natural gas. Today it transforms 18,000 tons of coal per day into 150 million cubic feet of natural gas and 150 million cubic feet of carbon dioxide using steam and oxygen. That's enough natural gas to supply the needs of 500,000 homes.
Before arriving, I had arranged to join what I thought would be a tour of the facility. But when I got to the plant, it turned out that the public “tour” consisted of a 10-minute video extolling the heroic efforts to finance, build, and keep the plant open combined with a half-hour walk around a very nice $8 million 1/32nd scale model of the plant, with videos interspersed along the walls describing how various parts of the plant operate. Hardly the gritty hardhat on-the-ground experience I was looking for, but it certainly worked as a way to cage in a noisy reporter from a public policy magazine. I later asked Daryl Hill, who heads up public communications for the plant’s owner Basin Electric, about other reporting on the plant. He happily told me about the wonderful CBS 60 Minutes feature done by reporter Scott Pelley. I mentioned that Pelley probably got an actual tour of the plant. Hill had the grace to blush.
Even my iPhone was forbidden on the grounds that no photos should be taken. Michelle, the very nice tour guide, explained that curious members of the public and reporters couldn’t tour the plant itself or take any photos on orders from Homeland Security, even of the model.
I did pick up a good deal of history on my "tour," however. Construction of the plant was first proposed in 1978, just months after the creation of the new Department of Energy during the “energy crisis.” Natural gas production in the U.S. had been declining since 1971 and nationwide shortages were causing schools and factories to close in the winters as gas was diverted to home heating and cooking. The solution to the shortages? Import liquefied natural gas from Algeria and other places. To that end a number of liquefied natural gas terminals were built on the Atlantic and Gulf coasts. (I got to regulate those, too.)
The other solution was to turn coal into methane. In 1980, Congress created the Synfuels Corporation, endowing it with $20 billion with the goal of eventually building as many as 22 enormous coal gasification plants, each one producing 300 million cubic feet of natural gas per day. Since coal gasification was an unproven technology in the U.S., natural gas pipeline companies were reluctant invest in it. The federal government rushed to the rescue. The Department of Energy helped create a public/private partnership with five natural gas pipeline companies that agreed to put up 25 percent of the cost of building a demonstration plant while the government supplied the remaining 75 percent in the form of loan guarantees. Out of this bold alliance between business and government was born the hugely ambitious Great Plains Coal Gasification plant.
The plant was built at a cost of $2.1 billion and shipped its first thousand feet of natural gas in July 1984. Due to escalating costs, the plant was scaled back to half size so that it was designed to produce 150 million cubic feet of gas per day. In the meantime, the hapless Jimmy Carter unknowingly had already undercut the rationale for constructing a massive coal gasification industry by a simple change in policy—he deregulated the price of natural gas. It turned out that the country wasn’t running out of natural gas; it was running out of natural gas with a government imposed price cap. That old truism—only governments create shortages—was once again proven correct.
Gas supplies soared and the price crashed, meaning that there was no need for the Great Plains Synfuels plant nor for the liquefied natural gas facilities along the coasts. In the face of faltering prices, the five gas pipeline “partner” companies demanded that government give them a price guarantee on the gas, or they would default on $1.5 billion in government backed loans. To its credit, the DOE refused to meet this demand and the companies promptly defaulted, abandoning the project.
The bankrupt plant was sold at public auction by the sheriff of Mercer County, North Dakota, on the local courthouse steps. The auction took five minutes and the only bidder was the DOE which bid $1 billion. No money changed hands since DOE already held $1.5 billion in defaulted loans. The DOE began operating it and looking for someone else to take it off their hands.
As it happens, the electric power generation company Basin Electric had built the next door Antelope Valley station in good part to supply the coal gasification facility with electricity. Closing the coal gasification plant would have had a significant negative effect on the company’s bottom line. In 1988, a desperate DOE agreed to sell the plant to Basin for the fire-sale price of $85 million and a split of future profits, if any. In other words, Basin Electric acquired an operating facility for 4 cents on the dollar. "Not having capital investment is the key,” said Keith Janssen, the head of the Basin Electric subsidiary in a 1990 Washington Post article. Well, yes. But even with taxpayers picking up the tab for building the plant, running it profitably was still a challenge.
The gas pipeline companies were trying to weasel out of their long term contracts with the plant in which they were obligated to pay two to three times more than the market rate for conventional natural gas. Eventually, a federal court ordered them to stop whining and pay up. But those contracts were set to expire in 1995. So Basin Electric developed markets in the byproducts of coal gasification. In 2009, more than two-thirds of the plant’s $400 million in revenues were derived from the sales of byproducts.
For example, the plant produces ammonia fertilizers. In one very technically sweet twist, the plant uses ammonia produced at the plant to capture sulfur emissions from the coal turning it into the valuable fertilizer ammonium sulfate. It also produces industrial chemicals like phenol, crude cresylic acid, and naptha. Since the coal gasification requires pure oxygen, the plant takes in ambient air and liquefies it by cooling it down. This enables the company to separate out the oxygen, but also to supply krypton, xenon, and liquid nitrogen to buyers. Finally, as of 1999, the plant also sells two-thirds of its daily emissions of 150 million cubic feet of carbon dioxide to oil producers 200 miles north in Canada to pressurize their fields. The fields that once produced 10,000 barrels per day are now gushing 30,000 barrels per day.
What was once a waste product is now a profitable business. The plant sold its carbon dioxide for about $53 million last year. But could this work for other companies that produce quantities of the greenhouse gas? Probably not. Hill points out that the plant does not produce carbon dioxide through combustion but as an integral part of turning coal into natural gas. This means that it’s a lot easier to capture carbon dioxide at Great Plains Synfuels than it will be at a conventional coal-fired electric generation plant. “A commercial scale technology for capturing carbon dioxide at conventional power plants simply doesn’t exist now,” says Hill. In addition, few power plants would have the happy coincidence of being located close enough to oil fields that will buy carbon dioxide for pressurizing their wells.
I asked Hill how much Basin Electric sells its gas for, and he declined to tell me, saying that it was confidential company information. However, since the long term gas supply contracts expired 15 years ago, the company has been selling its gas at current market prices. Looking at the company’s annual report one finds that the gasification subsidiary made a nice profit until those contracts expired in the mid-1990s. Between 1997 and 2005, the subsidiary experienced a cumulative loss of over $44 million.
Soaring gas prices in the last few years bulked up the gasification plant’s bottom line with a cumulative profit of $334 million between 2005 and 2009. So the gasification plant is profitable now. But hold on. Let’s make a very rough calculation of what would have happened if Basin Electric had had to make interest payments on the entire $2.1 billion in capital costs for the plant. Again roughly, paying just 5 percent interest annually on $2.1 billion would cost $105 million per year (and that does not include paying principal). In only one year since 1991 (earlier years not available) did the plant’s income exceed $105 million and that was in 2008 when the plant earned $128 million when natural gas prices rose to over $10 per thousand cubic feet. In other words, it’s a whole lot easier to make a “profit” if you don’t have to pay back your loans. Still, it is the case that by taking advantage of federal government ineptitude, Basin Electric executives made a pretty savvy investment at rock bottom prices.
In February of this year, Basin Electric sent a check for $7.1 million as its last profit-sharing payment to the DOE. Since it purchased the plant in 1988, Basin Electric has paid the DOE a total of $388 million. On receiving the last check, the DOE had the gall to declare that it had recovered $1.3 billion of the initial $1.5 billion loan. How? By noting that as an electric power generating company for a series of rural electric cooperatives, Basin Electric could not take advantage of about $800 million in federal tax credits that the feds would otherwise have been obligated to pay out for synthetic natural gas production.
At the end of my chat with Basin Electric’s Hill, I asked what lessons we could learn from the Great Plains Synfuels saga? “It shows us a way to use coal that is different from a burning it in a conventional power plant and it gives us a technological baseline of what could be,” replied Hill. He also recited the same points that I have now heard during a visit to a wind farm and a bioethanol plant: It provides jobs and frees us from foreign oil.
In 2007, John Panek, an analyst for the Energy Department's Office of Clean Energy Collaboration, pretty much summed up continuing government cluelessness when he told the Associated Press, "Technologically, it's always been a success, but it always has been a victim of the marketplace." The Obama administration is embarking on numerous similarly “visionary” subsidized energy R&D technology projects. I expect to see lots of technological "successes" and an equal number of market “victims.”
Note: I am traveling back to the East Coast over the next couple of weeks from a summer in Montana spent working on a new book. Along the way I am visiting various energy production facilities. The goal of this circuitous trip is for me to get a better understanding of energy production and to geek out on technological marvels.
Ronald Bailey is Reason's science correspondent. His book Liberation Biology: The Scientific and Moral Case for the Biotech Revolution is now available from Prometheus Books.
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http://www.jsg.utexas.edu/news/rels/062505a.html
Of peaks and valleys: Doomsday energy scenarios burn away under scrutiny
By Dr. Scott W. Tinker, Op-Ed for the Dallas Morning News, June 25, 2005
As senators debate the national energy policy, many are aware of the hype surrounding "peak oil." A Web search of the phrase turns up an array of experts who believe that a pending peak in world oil production will soon lead to global economic collapse.
The sun is setting on the oil era, but that doesn't mean we're doomed. In their rosier scenarios, experts predict sky-high gasoline prices that will crush oil-dependent economies, such as the U.S. In their darker forecasts, they say people won't be able to obtain food, heat their homes or live securely during a period of global famine and resource wars.
All of this might be entertaining were it another Hollywood film, but it has become almost a subculture (and cottage industry). For those who wonder whether the global production of oil will peak and begin to decline someday, the answer is yes.
The greater question: Should you care? Although talk of peak oil has rightfully focused global attention on the need to find alternatives to oil, the absolute peak of world oil production is an issue of supply and, in many ways, irrelevant. Unlike the 1973 oil embargo, when high prices were the result of an OPEC-orchestrated supply cut, high prices today largely reflect demand-supply imbalance. The global demand for conventional oil has outstripped, or soon will, the global capacity to supply conventional oil.
Does that mean we are all doomed?
While the shock value of doomsday peak oil predictions is entertaining, it is far more important to recognize the reality of high global energy demand and begin to seek solutions – such as the energy policy being debated in the Senate – that could help mitigate the supply-demand imbalance. Solutions abound but will take planning and coordinated investment.
In 1956, geophysicist M. King Hubbert correctly predicted that U.S. oil production would peak in the early 1970s. He incorrectly predicted that world oil would peak in 1995. What he missed was that advances in technology would allow producers to extract oil from known fields far beyond the technology capacity of his day.
Because of these advances, the shape of the oil production curve is not really a peak at all, but more of a bumpy mesa. If there is an important "peak" of oil, it actually occurred in the early 1980s, when oil consumption as a percentage of total global energy topped out just shy of 50 percent. That has declined today to about 40 percent, a trend that has been remarkably consistent and un-shockingly boring.
Dr. Hubbert can be excused for incorrectly forecasting the impact of technology, but today's forecasters should know better. They often claim that oil supply is made worse by modern enhanced oil recovery techniques that drain reservoirs faster. In fact, the reverse is true. The combination of higher energy prices and advanced technology will continue to extend the life of conventional oil supplies via enhanced oil recovery processes.
So what are the realistic near-term alternatives to conventional oil?
Most experts recognize that the age of conventional oil will fade during the 21st century. Energy demand in Asia and other developing regions will continue to outpace supply and keep oil prices high and volatile. Fortunately, price and technology will allow for production of heavy oil, tar sands and shale oil, whose combined global reserves far exceed those of conventional oil, as well as coal liquefaction and gasification, improved gas-to-liquids technology and alternatives to oil led initially by conventional and unconventional natural gas.
The challenge of natural gas is not resources, but deliverability. As liquefied natural gas ports are permitted and built, natural gas will become a global commodity and help reduce issues of deliverability that have caused price volatility. Natural gas, combined with other non-coal sources of fuel, will likely surpass oil as a percentage of total global energy consumption between 2015 and 2020. This crossover already happened in the U.S. around 1994.
If no substitute for oil existed, the world would indeed be in for an energy shock, and possibly an economic collapse. Fortunately, that is not the case, but investment must start today. U.S. energy policies must be aggressive, focus on efficiency and conservation measures and lead the world in a smooth transition to an unconventional-oil, clean-coal, natural-gas, nuclear and emerging-energy-supply future.
Our economy and environment will be the prime beneficiary.
This is not a shocking prognosis, but rather a boringly achievable one.
Dr. Scott Tinker is Texas state geologist and director of the Bureau of Economic Geology at the University of Texas at Austin's Jackson School of Geosciences, where he holds the Allday Endowed Chair. His e-mail address is scott.tinker@beg.utexas.edu.
For more information contact J.B. Bird at the Jackson School, jbird@jsg.utexas.edu, 512-232-9623.
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We Can't Afford the Luxury of High-speed Rail
by Randal O'Toole
This past Tuesday, Amtrak proposed to spend more than $100 billion increasing the top speeds of trains in its Boston-to-Washington corridor from 150 to 220 miles per hour. In August, Secretary of Transportation Ray LaHood estimated that President Obama's proposal to extend high-speed rail to other parts of the country will cost at least $500 billion.
No one knows where this money will come from, but President Obama argues that we need to spend it because high-speed rail will have a "transformative effect" on the American economy. In fact, all it will do is drag the economy down.
The history of transportation shows that we adopt new technologies when they are faster, more convenient, and less expensive than the technologies they replace. High-speed rail is slower than flying, less convenient than driving, and far more expensive than either one. As a result, it will never serve more than a few marginal travelers.
New transportation technologies have a truly transformative effect when they not only replace older technologies but also increase total mobility. Intercity passenger trains, electric streetcars, and mass-produced automobiles offered their customers thousands of miles per year of new mobility. This gave people access to jobs, resources, and opportunities that were previously unavailable.
The numbers
At an inflation-adjusted cost of about $450 billion paid out of highway user fees, the Interstate Highway System, to which high-speed rail is sometimes compared, provides more than 4,000 miles of passenger travel for every American, miles that Americans were not traveling before the system was built. By comparison, a $600 billion expenditure on high-speed rail will provide, at best, around 300 miles of travel per person.
More to the point, most of that travel will not be new travel, but merely a substitute for driving, flying, or other existing forms of travel. The California High-Speed Rail Authority predicts that 98% of its customers will shift from driving or flying. Florida predicts that 96% of the people using its high-speed train will switch from driving.
Almost no new travel means almost no transformative effect. Few people will use high-speed rail or urban rail transit to access new markets, resources, or jobs. Merely substituting rail for other modes will be extremely expensive.
Amtrak brags that its high-speed Acela between Boston and Washington covers its operating costs, though not its capital costs. It does so, however, only by collecting fares of about 75 cents per passenger mile. By comparison, airline fares average only 13 cents a passenger mile, and intercity buses (which, Amtrak doesn't want you to know, carry about three times as many passengers between Boston and Washington as the Acela) are even less expensive.
According to the Bureau of Economic Analysis, Americans spent about $950 billion on driving in 2008. This allowed us to travel, says the Federal Highway Administration, more than 2.7 trillion vehicle miles, for an average cost of about 35 cents per vehicle mile. Since the California High-Speed Rail Authority estimates cars in intercity travel carry an average of 2.4 people, the average cost is less than 15 cents a passenger mile.
Subsidizing the urban elite
In short, high-speed rail is more than five times more expensive than any of the alternatives. Since most high-speed rail stations will be in downtowns, the main users will be downtown workers such as lawyers, bankers, and government officials. Yet less than 8% of American jobs are in central city downtowns, meaning all Americans will subsidize trains used by only a small urban elite.
High-speed trains in Europe and Asia may be a boon to American tourists, but they haven't proved transformational in those regions either. France and Japan have the world's most extensive high-speed rail networks, yet their average residents ride the high-speed trains less than 400 miles a year.
Personally, I love trains and it would be nice to think we were rich enough to build a high-speed rail network that few people will ever use. But we are not. The Obama administration would do better by making our existing transportation systems safer and more effective.
http://www.cato.org/pub_display.php?pub_id=12188
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Similar problems are presented by the high speed line between LA and SF here in CA for which the voters voted to borrow billions of dollars which we don't have.
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http://www.popularmechanics.com/science/energy/next-generation/the-truth-about-thorium-and-nuclear-power?click=pp
Three to four times more plentiful than uranium, today's most common nuclear fuel, thorium packs a serious energetic punch: A single ton of it can generate as much energy as 200 tons of uranium, according to Nobel Prize-winning physicist Carlo Rubbia. In the mid-twentieth century, some U.S. physicists considered building the nuclear power landscape around thorium. But uranium-fueled reactors produced plutonium as a byproduct, a necessary ingredient for nuclear weapons production, and uranium ended up dominating through the Cold War and beyond.
Thorium could recapture the lead if a Virginia-based company called Lightbridge (formerly Thorium Power) fulfills its promise. Lightbridge was founded on the vision that the existing fleet of nuclear reactors would continue to function for decades to come, so its proprietary nuclear fuel assembly—which features a small amount of uranium surrounded by a blanket of thorium—is designed to work in light water reactors, the most common variety in service worldwide. The company is also developing an all-metal fuel capable of incorporating thorium. "This is like going from leaded to unleaded fuel for your car—the operation [of the reactors] is the same," says Seth Grae, Lightbridge's CEO.
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I was very excited by this until I read some of the comments. I still think this is fascinating. Run ships on sea water! I hope this becomes economical. Maybe a cost effective way to desalinate seawater.
http://www.physorg.com/news/2010-10-hydrogen-generating-technology-power-boats-energy.html
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Obama's electric-car cult
By Charles Lane
Saturday, October 30, 2010; 12:00 AM
General Motors' Chevy Volt is finally here, heralded by a new TV ad. "This is America, man," the narrator purrs, as the sun rises over a solitary Volt tooling along a country road. "So doesn't it make sense that we build an electric car that goes far, really far?"
The pitch is lyrical, almost religious. It asks consumers to make an economic and technological leap of faith - just as both GM and the firm's biggest backer, the Obama administration, have invested, financially, politically and psychologically, in plug-in hybrids and other electric vehicles.
How else to explain the fact that both Washington and Detroit persist in their costly electric-car project despite mounting evidence that the vehicles serve no particular purpose, environmental or economic?
Maybe it was karma, but the Volt's launch coincided with publication of a 72-page report by J.D. Power and Associates that confirmed, in devastating detail, what many other experts have found: Electric cars still cost too much, even with substantial federal subsidies for both manufacturers and consumers, to attract more than a handful of wealthy buyers - and this will be true for at least another decade.
What little gasoline savings the vehicles achieve could be had through cheaper alternative means. And electrics don't reliably reduce greenhouse gas emissions, since, as often as not, the electricity to charge their batteries will come from coal-fired plants.
The Obama Energy Department has suggested that, with the help of federal money, manufacturers can ramp up mass production and bring the price of electric-car battery packs down 70 percent by 2014 - thus rendering the cars more affordable.
But J.D. Power is skeptical. "Declines of any real significance are not anticipated during the next 5 years," the report notes, adding that "the disposal of depleted battery packs presents yet another environmental challenge."
Nor are industry and government close to resolving the lack of a nationwide recharging infrastructure - or the vehicles' poor performance in cold weather or on hilly terrain.
Fine print on the Volt ad promises just "25-50 miles of electric driving in moderate conditions." Translation: Much of the time the car will be running on gas, just like ones that cost far, far less than the four-seat Volt's price of $33,500 (after a $7,500 federal tax credit).
In short, the Obama administration's commitment of $5 billion in loans and grants for electric cars is the biggest taxpayer rip-off since corn-based ethanol. It benefits no one but a few well-to-do car buyers and politically connected companies. Any "green" jobs these rent-seeking firms create will vanish when consumers reject their products and/or the subsidies cease.
The administration's objectives - reducing carbon emissions and U.S. dependence on foreign oil - are legitimate. But $5 billion wasted on electrics is $5 billion that cannot be used to meet these goals. And then there's the private capital that Obama's policy is attracting to this losing proposition.
J.D. Power suggests, sensibly: "Rather than rushing to commercialize [battery-electric vehicles], the industry might be better served to pursue continued fuel economy improvements in [internal combustion engines] and the mass production of [conventional hybrids]."
For a president who claims to make policy based on "facts and science and argument," lavishing subsidies on electric cars is an intellectual scandal. The J.D. Power study is hardly an outlier. It jibes with similar work by Deloitte Touche, Boston Consulting Group, Roland Berger Strategy Consultants, professor Henry Lee of Harvard's Belfer Center for Science and International Affairs, and the Massachusetts Institute of Technology's Energy Initiative.
Last year the National Academy of Sciences' National Research Council concluded: "Subsidies in the tens to hundreds of billions of dollars. . .will be needed if plug-ins are to achieve rapid penetration of the U.S. automotive market. Even with these efforts, plug-in hybrid electric vehicles are not expected to significantly impact oil consumption or carbon emissions before 2030."
Yet, like a rural voter clinging to his guns, the Obama administration brushes aside the experts because - well, who knows why? Perhaps subsidizing electric cars helps a Democratic administration make corporate welfare and tax breaks for the wealthy seem progressive. It's possible President Obama feels bound by his grandiose campaign promise to put a million plug-in hybrid electric vehicles on the road by 2015.
Or maybe Republicans aren't the only ones susceptible to ideological obstinacy and magical thinking after all.
The writer is a member of the editorial page staff. His e-mail address is lanec@washpost.com.
http://www.washingtonpost.com/wp-dyn/content/article/2010/10/29/AR2010102905959.html
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2nd post. Wow, 2 in a row out of the WaPo dispensing with the usual leftist sweetness and energy light. Could this be a trend?
Calif. rail project is high-speed pork
By Robert J. Samuelson
Monday, November 1, 2010;
Somehow, it's become fashionable to think that high-speed trains connecting major cities will help "save the planet." They won't. They're a perfect example of wasteful spending masquerading as a respectable social cause. They would further burden already overburdened governments and drain dollars from worthier programs - schools, defense, research.
Let's suppose that the Obama administration gets its wish to build high-speed rail systems in 13 urban corridors. The administration has already committed $10.5 billion, and that's just a token down payment. California wants about $19 billion for an 800-mile track from Anaheim to San Francisco. Constructing all 13 corridors could easily approach $200 billion. Most (or all) of that would have to come from government at some level. What would we get for this huge investment?
Not much. Here's what we wouldn't get: any meaningful reduction in traffic congestion, greenhouse gas emissions, air travel, oil consumption or imports. Nada, zip. If you can do fourth-grade math, you can understand why.
High-speed inter-city trains (not commuter lines) travel at up to 250 miles per hour and are most competitive with planes and cars over distances of fewer than 500 miles. In a report on high-speed rail, the nonpartisan Congressional Research Service examined the 12 corridors of 500 miles or fewer with the most daily air traffic in 2007. Los Angeles to San Francisco led the list with 13,838 passengers; altogether, daily air passengers in these 12 corridors totaled 52,934. If all of them switched to trains, the total number of daily airline passengers, about 2 million, would drop only 2.5 percent. Any fuel savings would be less than that; even trains need energy.
Indeed, inter-city trains - at whatever speed - target such a small part of total travel that the changes in oil use, congestion or greenhouse gases must be microscopic. Every day, about 140 million Americans go to work, with about 85 percent driving an average of 25 minutes (three-quarters drive alone; 10 percent carpool). Even assuming 250,000 high-speed rail passengers, there would be no visible effect on routine commuting, let alone personal driving. In the Northeast Corridor, with about 45 million people, Amtrak's daily ridership is 28,500. If its trains shut down tomorrow, no one except the affected passengers would notice.
We are prisoners of economic geography. Suburbanization after World War II made most rail travel impractical. From 1950 to 2000, the share of the metropolitan population living in central cities fell from 56 percent to 32 percent, report UCLA economists Leah Platt Boustan and Allison Shertzer. Jobs moved, too. Trip origins and destinations are too dispersed to support most rail service.
Only in places with greater population densities, such as Europe and Asia, is high-speed rail potentially attractive. Even there, most of the existing high-speed trains don't earn "enough revenue to cover both their construction and operating costs," the Congressional Research Service report said. The major exceptions seem to be the Tokyo-Osaka and Paris-Lyon lines.
President Obama calls high-speed rail essential "infrastructure" when it's actually old-fashioned "pork barrel." The interesting question is why it retains its intellectual respectability. The answer, it seems, is willful ignorance. People prefer fashionable make-believe to distasteful realities. They imagine public benefits that don't exist and ignore costs that do.
Consider California. Its budget is a shambles. To save money, it furloughs state workers. Still, it clings to its high-speed rail project. No one knows the cost. In 2009, the California High-Speed Rail Authority estimated $42.6 billion, up from $33.6 billion in 2008 - a huge one-year increase. The CHSRA wants the federal government to pay almost half the cost. Even if it does and the state issues $9.95 billion in approved bonds, a financing gap of perhaps $15 billion would remain.
Somehow that is to be extracted from cities, towns and investors. The CHSRA says the completed system will generate annual operating profits, $3 billion by 2030. If private investors concurred, they'd be clamoring to commit funds; they aren't.
All this would further mortgage California's future with more debt and, conceivably, subsidies to keep the trains running. And for what? In 2030, high-speed rail trains would provide only about 4 percent of California's inter-regional trips, the CHSRA projects.
The absurdity is apparent. High-speed rail would subsidize a tiny group of travelers and do little else. If states want these projects, they should pay all costs because there are no meaningful national gains. The administration's championing and subsidies - with money that worsens long-term budget deficits - represent shortsighted, thoughtless government at its worst. It's a triumph of politically expedient fiction over logic and evidence. With governments everywhere pressed for funds, how can anyone justify a program whose main effect will simply be to make matters worse?
http://www.washingtonpost.com/wp-dyn/content/article/2010/10/31/AR2010103104260.html
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Good post.
Also the trafiic created when people drive and park near the rail stops.
Huge lots with huge numbers of cars. Most People aren't getting to the trains on bicycles, or car pooling.
I suppose next will be tax breaks for those who ride bikes.
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POTH
Solar-Panel Maker to Close a Factory and Delay ExpansionBy TODD WOODY
Published: November 3, 2010
SAN FRANCISCO — Solyndra, a Silicon Valley solar-panel maker that won half a billion dollars in federal aid to build a state-of-the-art robotic factory, plans to announce on Wednesday that it will shut down an older plant and lay off workers.
Solyndra opened Fab 2, a $733 million factory to make its high-tech solar panels. It plans to close an older facility, shown here.
The cost-cutting move, which will reduce the company’s previously announced production capacity, is a sign of the notable shift in the prospects for cutting-edge American solar companies, which now face intense price competition from Chinese manufacturers that use more established photovoltaic technologies.
Just seven weeks ago, Solyndra opened Fab 2, a $733 million factory in Fremont, Calif., to make its high-tech solar panels. The new plant was supposed to be the first phase of a rapid expansion of the company.
Instead, Solyndra has decided to shutter the old plant and postpone plans to expand Fab 2, which was built with a $535 million federal loan guarantee.
“Fab 2 is much more efficient and cost-effective than our existing facility,” Brian Harrison, Solyndra’s chief executive, said in an interview. “We’re adjusting our plans to be more in line with where the market is and where our business is at the moment.”
When Solyndra filed for an initial public stock offering in December, it estimated it would have a total production capacity of 610 megawatts by 2013 if its two plants were fully built out. The company now expects it have capacity of 285 to 300 megawatts by 2013.
Solyndra abandoned plans for the stock offering in June, citing market conditions.
The company is the most prominent of a wave of Silicon Valley solar start-ups that hoped to transform the economics of the industry. Gov. Arnold Schwarzenegger of California and Energy Secretary Steven Chu helped break ground on Fab 2 last year, and President Obama made an appearance at the unfinished factory in May to extol Solyndra’s innovative technology.
Mr. Harrison noted that the market had undergone a significant shift since Solyndra filed for the stock offering, with solar module prices plummeting as low-cost Chinese manufacturers like Suntech and Yingli ramped up production.
That has put pressure on companies like Solyndra, which makes advanced thin-film solar modules that are less efficient than conventional photovoltaic modules but had been cheaper to install until prices began to fall sharply last year.
Solyndra said it would lay off around 40 employees and not renew contracts for about 150 temporary workers as a result of the consolidation. The closing of the old factory, called Fab 1, will save the company more than $60 million in capital expenditures, executives said.
Mr. Harrison, who became Solyndra’s chief executive in July, said that despite the cutbacks, the company’s production of solar panels for commercial rooftops would double in 2011 from the previous year. He said Solyndra continued to receive large orders from customers.
Depending on how the market evolves, Solyndra could reopen Fab 1 or expand its new factory, Mr. Harrison said.
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http://www.insidebayarea.com/ci_16517629?IADID
Solyndra Inc., the high-flying solar panel maker once touted by President Barack Obama as a model for a green energy future, said Wednesday it has scuttled its factory expansion in Fremont, a move that will stop the company's plans to hire 1,000 workers.
Solyndra said it will also close an existing factory in the East Bay. That will leave the company with one Fremont factory, a new plant visible from Interstate 880.
The moves mean that instead of having 2,000 workers in Fremont, Solyndra will cap its work force at 1,000, which is about the current level. Solyndra also will, over the next several weeks, eliminate 155 to 175 jobs in Fremont. That includes 135 contract employees and 20 to 40 full-time workers, said David Miller, a Solyndra spokesman.
The company seeks to slash production costs amid fierce competition from rival manufacturers in China and the United States.
"Solar has become incredibly competitive," Miller said.
The factory retrenchment adds to what has already been a tough year for Solyndra.
"Solyndra is facing the heat," said Shyam Mehta, an analyst with GTM Research, which tracks alternative-energy markets. "Many higher-cost solar manufacturers are doing well. It's alarming for Solyndra to be cutting back when others are expanding."
The company's fortunes sparkled in September 2009, when the Obama administration announced $535 million in taxpayer loans to finance construction of a new solar-equipment
Advertisement
factory.
In December 2009, the company filed for an initial public offering of its stock expected to raise $300 million. In May, Obama toured the Solyndra facilities in Fremont.
The company's fortunes dimmed soon after. In June, Solyndra canceled its IPO, and the following month its chief executive officer, Chris Gronet, quit. Brian Harrison, a former Intel executive, took over as CEO.
**Read it all.**
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Long piece categorically demonstrating that public transit is about the most expensive form of transportation out there, with many of the costs directly associated with it's government run nature:
http://www.cato.org/pubs/pas/PA670.pdf
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STRATFOR cannot guarantee their complete accuracy.
Colin Chapman: After defending your patch and securing shelter, food and water, a reliable source of energy is the most important policy goal. The two most populous countries - China and India - compete with Japan and the United States for energy. China’s energy consumption has more than doubled in the last decade and is now more than that of the United States. So how are these Asian giants going to secure their future energy?
Welcome to Agenda and to discuss this, I’m joined by STRATFOR’s Rodger Baker. Rodger, let’s start with China.
Rodger Baker: China has been ramping up its energy consumption and we’ve seen that the rate of consumption increased quite a bit in the past few years. One of the things they’re doing to try to alleviate some of that is increasing natural gas imports. That’s by pipelines from Central Asia, it’s by pipelines from Russia that they’re working on, as well as building LNG import terminals. (Marc: Readers of the Afghanistan-Pakistan thread may remember my outside the box proposal for the US to do this for central Asia.)
The Chinese are looking at additional nuclear power as well - trying to set up more nuclear power plants, trying to increase the electricity that comes from that. They’re looking at alternative sources for energy - trying to spread out where they can get oil, where they can get gas, where they can even get coal or uranium. But in general, it’s it’s a very difficult proposition for the Chinese because of the speed and the pace at which energy consumption continues to rise.
Chapman: There’s a world shortage of natural gas at the moment, so this is a good time to do deals.
Baker: It’s certainly good to try to lock in deals for the Chinese at this time. They are a major consumer, and one of the advantages that they have is that they’re fairly close to several of the suppliers in Southeast Asia, in Australia, in Central Asia.
Chapman: Despite the failure of the Copenhagen Summit, China now seems to be at least thinking about clean energy. How serious is it?
Baker: Well, China’s energy and electricity production is almost 3/4 based on coal and is very hard to break away from coal. They’ve got massive domestic supply’s, although in recent years we’ve seen them have to shift to supplement with imports, particularly at peak times or when there’s transportation disruptions within the country.
Their green energy push has a couple of different focuses behind it. One is, of course, the idea that they want to improve the quality of energy that they produce. The other though is an attempt to draw in additional technology and additional payment from other countries, and the Chinese have been strong promoters of green energy, green energy technology and development. But they’ve hoped that a lot of the technology is going to come from the United States, from the Germans, from maybe the Japanese and the Koreans, and on that side they’re starting to find problems, and as we saw at the latest round of global talks on green energy, the Chinese initiative that we saw a year ago that seemed very strong is starting to pull back, starting to fade back, and they’re not really able to push forward as fast as they thought they would.
Chapman: Now the country with the second largest population is India. And it’s growing fast too. How is it going about securing its future energy supplies?
Baker: Like the Chinese, the Indians are looking at natural gas and trying to find ways to bring that in. The domestic infrastructure makes it very difficult in India to move a certain product to different locations of the country. Another thing with India, though, is that they are a fairly high user of a biomass and waste to produce energy. That’s been good for them in some ways in that it gives them domestic sources of energy that perhaps China and other countries don’t seem to take advantage of. On the other hand, the the polluting problems of those sorts of energy are starting to cause a backlash in India and starting to cause them to readjust the way in which they use those sorts of technologies.
Chapman: And then there’s Japan, which is the world’s third-largest economy. And an island state totally dependent on imports.
Baker: Japan is certainly one of the world’s largest economies despite years of economic malaise, and their energy consumption remains very high. But if you look at the charts - in the past - the Japanese were very good at implementing early on energy efficiency measures, and so that the importation of oil, the importation of natural gas didn’t continue to grow apace - where we saw the Chinese starting to rise in their consumptions.
The Japanese maintain their security of their supply lines by maintaining a very strong defense relationship with the United States, but we’ve also seen Tokyo start to dabble in developing its own ways of of ensuring supply lines. So we see them working closer with India, now we see them working in the Middle East. The Japanese have been working on what effectively is a base for their operations out of Djibouti, and these are ways that Japan, both from a security perspective and kind of a long-term interest perspective, is trying to strengthen their supply lines, particularly in the face of a China that seems to be not only more active but a China that is sucking up more and more resources.
Chapman: Of course, on the Pacific is Russia, which is a big energy supplier. Are they preparing to cash in on the huge increase in energy demand in the Pacific?
Baker: One of the problems that Russia faces in really breaking into this large East Asia demand for energy is location. The Russian energy resources aren’t near the borders are, not near the the coastal facilities except for maybe Sakhalin, and are not even near the Chinese border. So they have to run very long pipelines, they have to run the energy by rail and draw it out from really hostile territory inside Russia - based on the weather, based on how far north some of the territory is.
Another issue the Russians have is that they continue to be a little cautious about just where and how they supply their energy. For the longest time you would hear ideas that Russia was concerned that the Chinese were going to rush across the border and hold Siberia because they have a big population, and the Russians have a small population. That’s not really a concern at the moment. There’s no infrastructure there really to absorb the Chinese population or for the Chinese to do that.
The question becomes if you build these pipelines, if you bring in the Chinese investment to develop these energy fields does that change the equation on the way in which China looks at this Russia. So there’s a little bit of caution there. The Russians really have been pushing through their relationships and Central Asia to be able to feed into this region, but we certainly saw Moscow looking at substantially increasing its flow of energy products to the Pacific, to Asia over the next say 10 years.
Chapman: Rodger Baker, thanks very much for those insights on the Asian giants and the future of their energy security. That’s Agenda for this week. I’m Colin Chapman. Thanks very much for joining me.
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Surprise, surprise!
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POTH
BEIJING — Aided by at least $43 million in assistance from the government of Massachusetts and an innovative solar energy technology, Evergreen Solar emerged in the last three years as the third-largest maker of solar panels in the United States.
But now the company is closing its main American factory, laying off the 800 workers by the end of March and shifting production to a joint venture with a Chinese company in central China. Evergreen cited the much higher government support available in China.
The factory closing in Devens, Mass., which Evergreen announced earlier this week, has set off political recriminations and finger-pointing in Massachusetts. And it comes just as President Hu Jintao of China is scheduled for a state visit next week to Washington, where the agenda is likely to include tensions between the United States and China over trade and energy policy.
The Obama administration has been investigating whether China has violated the free trade rules of the World Trade Organization with its extensive subsidies to the manufacturers of solar panels and other clean energy products.
While a few types of government subsidies are permitted under international trade agreements, they are not supposed to give special advantages to exports — something that China’s critics accuse it of doing. The Chinese government has strongly denied that any of its clean energy policies have violated W.T.O. rules.
Although solar energy still accounts for only a tiny fraction of American power production, declining prices and concerns about global warming give solar power a prominent place in United States plans for a clean energy future — even if critics say the federal government is still not doing enough to foster its adoption.
Beyond the issues of trade and jobs, solar power experts see broader implications. They say that after many years of relying on unstable governments in the Middle East for oil, the United States now looks likely to rely on China to tap energy from the sun.
Evergreen, in announcing its move to China, was unusually candid about its motives. Michael El-Hillow, the chief executive, said in a statement that his company had decided to close the Massachusetts factory in response to plunging prices for solar panels. World prices have fallen as much as two-thirds in the last three years — including a drop of 10 percent during last year’s fourth quarter alone.
Chinese manufacturers, Mr. El-Hillow said in the statement, have been able to push prices down sharply because they receive considerable help from the Chinese government and state-owned banks, and because manufacturing costs are generally lower in China.
“While the United States and other Western industrial economies are beneficiaries of rapidly declining installation costs of solar energy, we expect the United States will continue to be at a disadvantage from a manufacturing standpoint,” he said.
Even though Evergreen opened its Devens plant, with all new equipment, only in 2008, it began talks with Chinese companies in early 2009. In September 2010, the company opened its factory in Wuhan, China, and will now rely on that operation.
An Evergreen spokesman said Mr. El-Hillow was not available to comment for this article.
Other solar panel manufacturers are also struggling in the United States. Solyndra, a Silicon Valley business, received a visit from President Obama in May and a $535 million federal loan guarantee, only to say in November that it was shutting one of its two American plants and would delay expansion of the other.
First Solar, an American company, is one of the world’s largest solar power vendors. But most of its products are made overseas.
Chinese solar panel manufacturers accounted for slightly over half the world’s production last year. Their share of the American market has grown nearly sixfold in the last two years, to 23 percent in 2010 and is still rising fast, according to GTM Research, a renewable energy market analysis firm in Cambridge, Mass.
In addition to solar energy, China just passed the United States as the world’s largest builder and installer of wind turbines.
The closing of the Evergreen factory has prompted finger-pointing in Massachusetts.
Ian A. Bowles, the former energy and environment chief for Gov. Deval L. Patrick, a Democrat who pushed for the solar panel factory to be located in Massachusetts, said the federal government had not helped the American industry enough or done enough to challenge Chinese government subsidies for its industry. Evergreen has received no federal money.
“The federal government has brought a knife to a gun fight,” Mr. Bowles said. “Its support is completely out of proportion to the support displayed by China — and even to that in Europe.”
Stephanie Mueller, the Energy Department press secretary, said the department was committed to supporting renewable energy. “Through our Loan Program Office we have offered conditional commitments for loan guarantees to 16 clean energy projects totaling nearly $16.5 billion,” she said. “We have finalized and closed half of those loan guarantees, and the program has ramped up significantly over the last year to move projects through the process quickly and efficiently while protecting taxpayer interests.”
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Evergreen did not try to go through the long, costly process of obtaining a federal loan because of what it described last summer as signals from the department that its technology was too far along and not in need of research and development assistance. The Energy Department has a policy of not commenting on companies that do not apply.
Evergreen was selling solar panels made in Devens for $3.39 a watt at the end of 2008 and planned to cut its costs to $2 a watt by the end of last year — a target it met. But Evergreen found that by the end of the fourth quarter, it could fetch only $1.90 a watt for its Devens-made solar panels, while Chinese manufacturers were selling them for as little as $1 a watt.
Evergreen’s joint-venture factory in Wuhan occupies a long, warehouselike concrete building in an industrial park located in an inauspicious neighborhood. A local employee said the municipal police had used the site for mass executions into the 1980s.
When a reporter was given a rare tour inside the building just before it began mass production in September, the operation appeared as modern as any in the world. Row after row of highly automated equipment stretched toward the two-story-high ceiling in an immaculate, brightly lighted white hall. Chinese technicians closely watched the computer screens monitoring each step in the production processes.
In a telephone interview in August, Mr. El-Hillow said that he was desperate to avoid layoffs at the Devens factory. But he said Chinese state-owned banks and municipal governments were offering unbeatable assistance to Chinese solar panel companies.
Factory labor is cheap in China, where monthly wages average less than $300. That compares to a statewide average of more than $5,400 a month for Massachusetts factory workers. But labor is a tiny share of the cost of running a high-tech solar panel factory, Mr. El-Hillow said. China’s real advantage lies in the ability of solar panel companies to form partnerships with local governments and then obtain loans at very low interest rates from state-owned banks.
Evergreen, with help from its partners — the Wuhan municipal government and the Hubei provincial government — borrowed two-thirds of the cost of its Wuhan factory from two Chinese banks, at an interest rate that under certain conditions could go as low as 4.8 percent, Mr. El-Hillow said in August. Best of all, no principal payments or interest payments will be due until the end of the loan in 2015.
By contrast, a $21 million grant from Massachusetts covered 5 percent of the cost of the Devens factory, and the company had to borrow the rest from banks, Mr. El-Hillow said.
Banks in the United States were reluctant to provide the rest of the money even at double-digit interest rates, partly because of the financial crisis. “Therein lies the hidden advantage of being in China,” Mr. El-Hillow said.
Devens, as the site of a former military base, is a designated enterprise zone eligible for state financial support.
State Senator Jamie Eldridge, a Democrat whose district includes Devens, said he was initially excited for Evergreen to come to his district, but even before the announced loss of 800 jobs, he had come to oppose such large corporate assistance.
“I think there’s been a lot of hurt feelings over these subsidies to companies, while a lot of communities around the former base have not seen development money,” he said.
Michael McCarthy, a spokesman for Evergreen, said the company had already met 80 percent of the grant’s job creation target by employing up to 800 factory workers since 2008 and should owe little money to the state. Evergreen also retains about 100 research and administrative jobs in Massachusetts.
The company also received about $22 million in tax credits, and it will discuss those with Massachusetts, he said.
Evergreen has had two unique problems that made its Devens factory vulnerable to Chinese competition. It specializes in an unusual kind of wafer, making it hard to share research and development costs with other companies. And it was hurt when Lehman Brothers went bankrupt in 2008; Evergreen lost one-seventh of its outstanding shares in a complex transaction involving convertible notes. But many other Western solar power companies are also running into trouble, as competition from China coincides with uncertainty about the prices at which Western regulators will let solar farms sell electricity to national grids.
According to Bloomberg New Energy Finance, shares in solar companies fell an average of 26 percent last year. Evergreen’s stock, which traded above $100 in late 2007, closed Friday in New York at $3.03.
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http://www.guardian.co.uk/business/2011/feb/08/saudi-oil-reserves-overstated-wikileaks
WikiLeaks cables: Saudi Arabia cannot pump enough oil to keep a lid on prices
US diplomat convinced by Saudi expert that reserves of world's biggest oil exporter have been overstated by nearly 40%
• Peak oil alarm revealed by secret official talks
• Datablog: Are we running out of oil?
* John Vidal, environment editor
* guardian.co.uk, Tuesday 8 February 2011 22.00 GMT
* Article history
Aerial View of Oil Refinery Saudi oil refinery. WikiLeaks cables suggest the amount of oil that can be retrieved has been overestimated. Photograph: George Steinmetz/Corbis
The US fears that Saudi Arabia, the world's largest crude oil exporter, may not have enough reserves to prevent oil prices escalating, confidential cables from its embassy in Riyadh show.
The cables, released by WikiLeaks, urge Washington to take seriously a warning from a senior Saudi government oil executive that the kingdom's crude oil reserves may have been overstated by as much as 300bn barrels – nearly 40%.
The revelation comes as the oil price has soared in recent weeks to more than $100 a barrel on global demand and tensions in the Middle East. Many analysts expect that the Saudis and their Opec cartel partners would pump more oil if rising prices threatened to choke off demand.
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Canada PM Harper Urges U.S. to Approve Oil Pipeline
Published February 04, 2011
| Associated Press
WASHINGTON -- Canadian Prime Minister Stephen Harper on Friday urged U.S. officials to approve a proposed oil pipeline from Canada to the U.S. Gulf Coast, calling Canada a "secure, stable and friendly" neighbor that poses no threat to U.S. security.
By contrast, many other countries that supply oil are not stable, secure or friendly to U.S. interests, Harper said at a White House news conference following a meeting with President Barack Obama.
Harper did not name any other country, but pipeline supporters have singled out countries such as Venezuela, Nigeria, Saudi Arabia and Iran as places where the United States faces security threats and instability. Canada's environment minister has used the term "ethical oil" to describe his country's crude supplies, saying Canada respects human rights, workers' rights and environmental responsibility.
"The choice that the United States faces in all of these matters is whether to increase its capacity to accept such energy from the most secure, most stable and friendliest location it can possibly get that energy, which is Canada, or from other places that are not as secure, stable or friendly to the interests and values of the United States," Harper said.
Obama, standing next to Harper at a news conference, did not address the pipeline issue.
A Canadian company is pushing to build a 1,900-mile pipeline that would carry crude oil extracted from tar sands in Alberta, Canada, to refineries in Texas. The $7 billion pipeline could substantially reduce U.S. dependency on oil from the Middle East and other regions, according to a report commissioned by the Obama administration.
The study suggests that the proposed Keystone XL pipeline, coupled with a reduction in overall U.S. oil demand, "could essentially eliminate Middle East crude imports longer term." The pipeline would double the capacity of an existing pipeline from Canada, producing more than 500,000 barrels a day of crude oil derived from formations of sand, clay and water in western Canada.
A report prepared by a Massachusetts firm at the request of the U.S. Energy Department was completed in December, but made public this week in advance of Obama's meeting with Harper.
"This study supports what we have been saying for some time -- that Keystone XL will improve U.S. energy security and reduce dependence on foreign oil from the Middle East and Venezuela," said Russ Girling, CEO of Calgary-based TransCanada, the project's developer. "Keystone XL will also create 20,000 high-paying jobs for American families and inject $20 billion into the U.S. economy."
An environmental group that opposes the pipeline said Harper failed to acknowledge that tar sands oil is highly polluting.
"There are cleaner, safer ways to meet U.S. energy needs than to import this dirty oil from Canada via a dangerous pipeline through America's heartland," said Alex Moore of the environmental group Friends of the Earth.
Moore said he was glad that Obama did not express support for the pipeline, adding that if Obama is serious about making America a leader in clean energy, "he has no choice but to stop this project."
Environmental groups call the pipeline an ecological disaster waiting to happen and say the so-called tar sands produce "dirty" oil that requires huge amounts of energy to extract.
A coalition of 86 environmental and progressive groups sent a letter Friday urging Obama to reject the pipeline and "stop giving a free pass to oil companies to increase profits at the expense of Americans." Activists also gathered across from the White House on Friday to protest the project.
The American Petroleum Institute, meanwhile, sent a letter urging Obama to approve the project.
Secretary of State Hillary Rodham Clinton must grant a permit allowing the pipeline to cross the U.S-Canadian border before TransCanada can proceed. Clinton said in October she was "inclined" to approve the project but has since backed off those remarks.
Lawmakers from both parties have written to the State Department for and against the pipeline, which would travel through Montana, South Dakota, Nebraska, Kansas and Oklahoma before reaching Texas. Some of the strongest opposition is in Nebraska, where the state's two U.S. senators have raised sharp questions. The pipeline would travel over parts of the massive Ogallala aquifer, which supplies drinking water to about 2 million people in Nebraska and seven other states and supports irrigation.
The aquifer serves five of the states where the pipeline travels -- South Dakota, Nebraska, Kansas, Oklahoma and Texas -- as well as Wyoming, Colorado and New Mexico.
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Bad news: The birth of Sharia-PEC
So, let's just look at what some additional spikes in oil could mean:
http://money.cnn.com/2011/02/24/news/economy/economic_risks_oil_spike_spending_cuts_stocks/index.htm
Danger #1: Rising oil prices: The spike in oil prices has not only sparked a sell-off in stocks, it's made economists far less bullish about the strength of the recovery.
But most believe that oil prices at $100 a barrel isn't high enough to cause a problem.
"At $100, it's a significant problem, but it's not a killer," said Wyss.
Wyss said $150-a-barrel oil would be the problem level. Others put the tipping point closer to $120 or $125 a barrel. And uncertainty in the Middle East has many wondering how high it will go.
"The big geopolitical changes we've been seeing didn't stop with Tunisia, and didn't stop with Egypt. So maybe it's not a good idea to assume it's all going to stop with Libya, either," said James Hamilton, economics professor at the University of California-San Diego. "If there is a disruption for Saudi Arabia, it would be off the charts in its impact on the world economy."
But it is possible that oil is already at a level that will cause a new recession, although it could take months to know for sure, according to David Rosenberg, chief economist with Guskin Sheff. He believes the problem with this oil spike is that the economy, while growing, is still weak.
"When oil prices were ratcheting up to record levels a few years ago, unemployment was at 5%, not 9%," he said. "The Fed had ammunition left. There was still appetite for fiscal stimulus. There's nothing in the cookie jar today as an offset."
**Consider how the spike in oil price could effect stability within China, and the potential for very bad things to stem from that.
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My first reaction to that is that the Chinese have LOTS of money tucked away for a rainy day and they are far better suited to survive oil shocks than we are; cf the US as a creditor nation coming out of WW1
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I'd agree they are better positioned than we are, however they'd feel it, just as they are feeling the QE-2. As I've said before, China is forced to run as fast as it can just to stay in one place. A prolonged economic downturn in China will have godawful results, both internally and for places like Taiwan, maybe Japan as well.
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http://www.nytimes.com/2011/02/27/us/27gas.html?nl=todaysheadlines&emc=tha23
Regulation Lax as Gas Wells’ Tainted Water Hits Rivers
By IAN URBINA
Published: February 26, 2011
The American landscape is dotted with hundreds of thousands of new wells and drilling rigs, as the country scrambles to tap into this century’s gold rush — for natural gas.
Drilling Down
The gas has always been there, of course, trapped deep underground in countless tiny bubbles, like frozen spills of seltzer water between thin layers of shale rock. But drilling companies have only in recent years developed techniques to unlock the enormous reserves, thought to be enough to supply the country with gas for heating buildings, generating electricity and powering vehicles for up to a hundred years.
So energy companies are clamoring to drill. And they are getting rare support from their usual sparring partners. Environmentalists say using natural gas will help slow climate change because it burns more cleanly than coal and oil. Lawmakers hail the gas as a source of jobs. They also see it as a way to wean the United States from its dependency on other countries for oil.
But the relatively new drilling method — known as high-volume horizontal hydraulic fracturing, or hydrofracking — carries significant environmental risks. It involves injecting huge amounts of water, mixed with sand and chemicals, at high pressures to break up rock formations and release the gas.
With hydrofracking, a well can produce over a million gallons of wastewater that is often laced with highly corrosive salts, carcinogens like benzene and radioactive elements like radium, all of which can occur naturally thousands of feet underground. Other carcinogenic materials can be added to the wastewater by the chemicals used in the hydrofracking itself.
While the existence of the toxic wastes has been reported, thousands of internal documents obtained by The New York Times from the Environmental Protection Agency, state regulators and drillers show that the dangers to the environment and health are greater than previously understood.
The documents reveal that the wastewater, which is sometimes hauled to sewage plants not designed to treat it and then discharged into rivers that supply drinking water, contains radioactivity at levels higher than previously known, and far higher than the level that federal regulators say is safe for these treatment plants to handle.
Other documents and interviews show that many E.P.A. scientists are alarmed, warning that the drilling waste is a threat to drinking water in Pennsylvania. Their concern is based partly on a 2009 study, never made public, written by an E.P.A. consultant who concluded that some sewage treatment plants were incapable of removing certain drilling waste contaminants and were probably violating the law.
The Times also found never-reported studies by the E.P.A. and a confidential study by the drilling industry that all concluded that radioactivity in drilling waste cannot be fully diluted in rivers and other waterways.
But the E.P.A. has not intervened. In fact, federal and state regulators are allowing most sewage treatment plants that accept drilling waste not to test for radioactivity. And most drinking-water intake plants downstream from those sewage treatment plants in Pennsylvania, with the blessing of regulators, have not tested for radioactivity since before 2006, even though the drilling boom began in 2008.
In other words, there is no way of guaranteeing that the drinking water taken in by all these plants is safe.
That has experts worried.
“We’re burning the furniture to heat the house,” said John H. Quigley, who left last month as secretary of Pennsylvania’s Department of Conservation and Natural Resources. “In shifting away from coal and toward natural gas, we’re trying for cleaner air, but we’re producing massive amounts of toxic wastewater with salts and naturally occurring radioactive materials, and it’s not clear we have a plan for properly handling this waste.”
The risks are particularly severe in Pennsylvania, which has seen a sharp increase in drilling, with roughly 71,000 active gas wells, up from about 36,000 in 2000. The level of radioactivity in the wastewater has sometimes been hundreds or even thousands of times the maximum allowed by the federal standard for drinking water. While people clearly do not drink drilling wastewater, the reason to use the drinking-water standard for comparison is that there is no comprehensive federal standard for what constitutes safe levels of radioactivity in drilling wastewater.
Drillers trucked at least half of this waste to public sewage treatment plants in Pennsylvania in 2008 and 2009, according to state officials. Some of it has been sent to other states, including New York and West Virginia.
Yet sewage treatment plant operators say they are far less capable of removing radioactive contaminants than most other toxic substances. Indeed, most of these facilities cannot remove enough of the radioactive material to meet federal drinking-water standards before discharging the wastewater into rivers, sometimes just miles upstream from drinking-water intake plants.
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There are 4 more pages to the article
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BREAKING: Iranian Official Admits Aiding Hezbollah, Says All Middle East Oil Will Be Cut Off To the West
Sepah News (the house organ of the Iranian Revolutionary Guard) reports:
On Wednesday, March 2nd, Commander of the Basij organization, Brigadier General Mohammad-Reza Naghdi spoke at a conference of specialist working groups of Basiji corps of engineers. “Seventy percent of the world’s fossil fuel reserve is under the feet of the soldiers of the Supreme Leadership and soon oil and gas fields belonging to Muslims, which is now in the hands of America will fall into the hands of the people; that will be the time when all those overlords will have sanctions put on them.” He added: “The enemy is heavily dependent on this energy and the events in the region has them quite agitated, this of course provides us with a hopeful future.”
Naghdi added: “In combating the sanctions our engineers have achieved many impressive things which has clearly frustrated the enemy. And of course our engineers in the nuclear area were shining examples as they were faced with international powers which had colluded against us in preventing this project from going forward, but they did not succeed.”
Naghdi admitted that the Basij militia was in fact instrumental in supporting Palestinians and the Hezbollah during the 22 day and 33 day wars and this has also sparked awareness among people around the world. He said: “Today Zionism is surrounded and it’s days are numbered. If we stay the course and carry out all plans as designed, the awareness that we have inspired will be the basis for the downfall of the overlords.’
Underlining the importance of the changes taking place throughout the region and especially regarding Libya Naghdi claimed: “The Americans have installed their own agent there so that he resists; this then will be a reason for the U.S. to launch a military attack. They’ve always hated the idea of the oil being in control of Muslims, therefore they conspire against all those countries.” He added: “This military resistance in Libya resembles the atrocities committed by Saddam which in fact was America’s own set up as a part of creating the basis for total control over that country. Any action against Libya would be a stupider move than the stupidity of the invasion of Iraq. There are great men in that country and they will never allow their soil to be under American control for a single day. Should the U.S. attack any of the (liberated) countries, it will suffer a blow at the hand of all the nations of Islam.
This decade is the decade of the people’s rule in our region, to push America out, destroy the Zionists; this of course adds to our responsibilities as we must protect and guarantee that all those people who have managed to free themselves, do not fall prey to the evil overlords.”
(Translation provided by “Reza Kahlili,” a pseudonym for an ex-CIA spy who requires anonymity for safety reasons. A Time to Betray, his book about his double life as a CIA agent in Iran’s Revolutionary Guards, was published by Simon & Schuster on April 6.)
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(Long answer to a long post. Read the state summarizes at the end if the rest gets too long.)
If true, the NY Times piece posted by Crafty 2/27/2011 is very significant because natural gas is the cleaner with substitute, has U.S. and North American origins, and solves a big part of the energy challenge. If false the allegations are significant as well because it will still become talking points for anti-energy types, stall exploration and extraction back into a climate change style cultural conflict.
Plenty of sources are responding to the story, I'm sure each will be attacked for motives.
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WSJ has a nice story on natural gas expansion yesterday: http://online.wsj.com/article/SB10001424052748703752404576178740650203046.html?KEYWORDS=ohio%20and%20gas
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API site: http://www.api.org/policy/exploration/hydraulicfracturing/
Hydraulic fracturing is a technology used in the United States to help produce more than 7 billion barrels of oil and 600 trillion cubic feet of natural gas. The technology has been used since the 1940s in more than 1 million wells in the United States. Its continued use is critically important to producing at home more of the oil and natural gas the nation will be consuming in the decades ahead. Even though America has abundant natural gas resources, most cannot be produced without this technology. Studies estimate that up to 80 percent of natural gas wells drilled in the next decade will require hydraulic fracturing.
Groundwater Protection through Proper Well Construction
Hydraulic fracturing makes it possible to produce oil and natural gas in places where conventional technologies are ineffective. It uses water pressure, under tight controls, to create fractures in rock that allow the oil and natural gas it contains to escape and flow out of a well. Hydraulic fracturing is well-regulated and safe, and it has a proven track record.
In 2004, the U.S. Environmental Protection Agency concluded, “the injection of hydraulic fracturing fluids into coal-bed methane wells pose little or no threat to (underground drinking water).” The agency, in a review of incidents of drinking water well contamination, found “no confirmed cases linked to fracturing fluid injection of CBM (coalbed methane) wells or subsequent underground movement of fracturing fluid.” See EPA's Evaluation of Impacts to Underground Sources of Drinking Water by Hydraulic Fracturing. http://www.epa.gov/safewater/uic/pdfs/cbmstudy_attach_uic_exec_summ.pdf On average, 99.5% of the fluids used in hydraulic fracturing are a combination of freshwater and compounds, which are injected into deep shale gas formations and then confined by thousands of feet of rock.
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http://marcelluscoalition.org/2011/02/drilling-down-into-ny-times-story-on-wastewater/
Drilling Down into NY Times Story on Wastewater February 28, 2011
Five areas report fails to provide proper context, information on Pa.’s regulatory oversight
Yesterday’s New York Times included a story highly critical of the regulatory framework governing waste water treatment and disposal from natural gas exploration in Pennsylvania. While raising some valid questions about water monitoring, this article – seven months in the making – lacks context, offers misleading comparisons and in some cases put forth information that is not supported by the facts.
NY Times Myth: “[Pennsylvania] is the only state that has allowed drillers to discharge much of their waste through sewage treatment plants into rivers.”
* Pennsylvania leads the nation in waste water recycling; vast majority of produced water reused in drilling operations: “State environmental regulators say that nearly 70 percent of the wastewater produced by Marcellus Shale wells is being reused or recycled. The Marcellus Shale Coalition, an industry group, puts the number higher, saying that on average 90 percent of the water that returns to the surface is recycled.” (Scranton Times-Tribune, 2/27/11)
* Industry moving towards 100 percent recycling, zero discharge: “It makes sense to reuse this water,” said Ron Schlicher, an engineer consulting for the treatment company. “The goal here is to strive for 100-percent reuse, so we don’t have to discharge.” (Wilkes-Barre Times Leader, 10/28/10)
* Marcellus operators recycling majority of waste water: “…all of the state’s biggest drillers say they are now recycling a majority of the wastewater produced by their wells in new fracturing jobs, rather than sending it to treatment plants. Hanger said about 70 percent of the wastewater is now being recycled …” (Associated Press, 1/4/11)
* Recycling of waste water to be norm for Marcellus Shale gas wells (Pittsburgh Tribune-Review, 10/20/09)
NY Times Myth: “Gas producers are generally left to police themselves when it comes to spills. In Pennsylvania, regulators do not perform unannounced inspections to check for signs of spills. Gas producers report their own spills, write their own spill response plans and lead their own cleanup efforts.”
* Flashback — DEP Inspector visits drilling site, unannounced, finds leaky valve on storage tank: “A DEP inspector discovered the spill while inspecting the well pad. The inspector found that the bottom valve on a 21,000-gallon fracking fluid tank was open and discharging fluid off the well pad. No one else was present at the pad, which has one producing Marcellus well.” (DEP press release, 11/22/10)
* In 2010 alone, DEP oversight staff performed nearly 5,000 inspections at Marcellus Shale drilling locations, a more than 100 percent increase over the previous year. (DEP Year End Workload Report, accessed 2/27/11)
* Pennsylvania recognized for having “well managed” hydraulic fracturing regulatory program: “A targeted review of the Pennsylvania program regulating the hydraulic fracturing of oil and gas wells has been completed by a multi-stakeholder group, which has concluded that the program is, over all, well-managed, professional and meeting its program objectives.” (STRONGER press release, 9/24/10)
* Pennsylvania hired more than 110 new inspectors, oversight personnel in last two years: “DEP was hit with layoffs after the overdue state budget was enacted in October, but the agency’s oil and gas division is considered exempt from layoffs or hiring freezes, added Mr. Hanger. All told, 193 agency employees work full time on oil and gas regulatory issues.” (Scranton Times-Tribune,1/29/11)
* Former PA Sec. of Environmental Protection details strong regulatory oversight and enforcement: “[The DEP] hired in 2009 and twice in 2010. We opened a new drilling staff office in Williamsport in 2009 and another in Scranton during 2010. Pennsylvania is the only state that has hired substantial or any staff for its drilling operation. The NYT does not say that, because it does not fit its narrative of lax Pennsylvania regulation. Indeed, the reporter deliberately did not include a long list of actions by DEP that represented strong enforcement.” (John Hanger blog, 2/27/11)
NY Times Myth: “But the relatively new drilling method — known as high-volume horizontal hydraulic fracturing, or hydrofracking — carries significant environmental risks. It involves injecting huge amounts of water, mixed with sand and chemicals, at high pressures to break up rock formations and release the gas.
* Does The Times Read The Times? According to an NY Times fact-check, from last week: “The method of drilling is not called ‘hydraulic fracturing.’ Fracturing, or ‘fracking’ is a process that is one part of drilling a well and producing oil or gas. Fracturing has been used by drillers for around 60 years.” (New York Times, 2/24/11)
NY Times fails to provide proper context: “Drilling companies were issued roughly 3,300 Marcellus gas-well permits in Pennsylvania last year, up from just 117 in 2007.”
* Like most information, without context, readers can and will be lead to think something that is not entirely accurate. While the reporter is correct in stating 3,300 Marcellus permits were issued, he fails to state that less than half that number of wells were actually drilled. According to state data, between January 1 and December 31, 2010, 1,446 Marcellus wells were drilled. (DEP Year End Workload Report, accessed 2/27/11)
NY Times fails to provide proper context, again: “The risks are particularly severe in Pennsylvania, which has seen a sharp increase in drilling, with roughly 71,000 active gas wells, up from about 36,000 in 2000.”
* Of those 71,000 active natural gas wells in Pennsylvania wells, only 2,498 are horizontal Marcellus wells – or 3.5 percent of all wells in Pennsylvania. (DEP Year End Workload Report, accessed 2/27/11)
Bonus Fact Check
NY Times quotes former Pa. DEP secretary…
… But the reporter never actually interviewed top environmental regulator for story about environmental regulations in Pennsylvania: “[T]hough I am quoted in the piece, this reporter never interviewed me prior to the publication of the Sunday article… As Secretary, I was interviewed hundreds and probably thousands of times. I made myself totally accessible to reporters. My staff knew that I was available to reporters. This reporter today says he asked Governor Corbett’s administration at DEP on January 21st, three days after Governor Rendell and I left office, to confirm the quotation that the reporter strung together (sic) from some other source.” (John Hanger blog, 2/27/11)
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Hydraulic Fracturing –15 Statements from Regulatory Officials
http://www.hydraulicfracturing.com/Documents/Hydraulic_Fracturing_SGEIS_comments.pdf
"In recent months, the states have become aware of press reports and websites alleging
that six states have documented over one thousand incidents of ground water
contamination resulting from the practice of hydraulic fracturing. Such reports are not
accurate." - President of the Ground Water Protection Council
"After 25 years of investigating dtizen complainls of contamination, DMRM geologists
have not documented a single inddent involVing contamination of ground water
attributed to hydraulic fracturing." - Ohio Department of Natural Resources
After review of DEP's complaint database and interviews with regional staff that
investigate groundwater contamination related to oil and gas activities, no groundwater pollution
or disruption of underground sources of drinking water has been attributed to hydraulic
fracturing of deep gas fonnations. - Pennsylvania Department of Environmental Protection
"we have found no example of contamination of usable water where the cause was claimed to. be hydraUlic fracturing." - New Mexico Energy, Minerals and Natural Resources Department
"I can state with authority that there have been no documented cases of drinking water
contamination caused by such hydraulic fracturing operations in our State." - STATE OIL AND GAS BOARD OF ALABAMA
"Though hydraulic fracturing has becn
used for over 50 years in Texas, our records do not indicate a single documented contamination case
associated with hydraulic fracturing." - chief regulatory agency over oil and gas activities in Texas
"There have been no verified cases of harm to ground water in the State of Alaska as a result of
hydraulic fracturing." - Commissioner Alaska Oil and Gas Conservation Commission
"To the knowledge of the Colorado Oil and Gas Conservation Commission staff, there has been
no verified instance of harm to groundwater caused by hydraulic fracturing in Colorado."
"There have been no instances where the Division of Oil and Gas has verified that harm to
groundwater has ever been found to be the result of hydraulic fracturing in Indiana." - Director
Indiana Department of Natural Resources
"The Louisiana Office of Conservation is unaware of any instance of harm to groundwater in the
State of Louisiana caused by the practice of hydraulic fracturing."
"My agency, the Office of Geological Survey (OGS) of the Department of Environmental
Quality, regulates oil and gas exploration and production in Michigan. Hydraulic fracturing has been utilized extensively for many years in Michigan, in both deep formations and in the relatively shallow Antrim Shale formation. There are about 9,900 Antrim wells in Michigan producing natural gas at depths of 500 to 2000 feet. Hydraulic fracturing has been used in virtually every Antrim well.
There is no indication that hydraulic fracturing has ever caused damage to ground water or other
resources in Michigan."
"No documented cases of groundwater contamination from fracture stimulations in
Wyoming."
Link again: Hydraulic Fracturing –15 Statements from Regulatory Officials
http://www.hydraulicfracturing.com/Documents/Hydraulic_Fracturing_SGEIS_comments.pdf
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http://news.yahoo.com/s/nm/20110309/lf_nm_life/us_usa_oil
MEXICO CITY (Reuters) – Americans worried about the pain of $100 U.S. oil should worry a lot more.
Although $100 oil is the headline in U.S. newspapers, most refineries that supply fuel to service stations are paying the equivalent of a much higher price -- and those costs are already being felt when consumers fill up their vehicles.
The cause is an unprecedented disconnect between the most visible price of oil -- crude oil futures contracts on the New York Mercantile Exchange (NYMEX) -- and the real cost of physical barrels pumped from the Gulf of Mexico, Saudi Arabia and elsewhere.
This gap is caused by oil traders' growing realization that inventories at the small Oklahoma town of Cushing -- the delivery point for the NYMEX contract -- will likely be awash with crude for months to come due to booming production from Canada and shale oil producing states such as North Dakota.
Because the U.S. pipeline system was designed to import oil from the coast to the interior, not vice versa, there's no way to move the extra northern crude to the southern refiners, in places such as Houston and Port Arthur, Texas, which are paying much higher rates for crude from far abroad.
Refiners on the West, Gulf and East coasts -- who produce or import nearly 85 percent of America's fuel -- are therefore forced to pay a premium of $15 to $20 relative to the current futures price of $100 a barrel to keep their plants fed, and pump prices are reflecting that premium.
U.S. oil futures, also called West Texas Intermediate (WTI) after a kind of oil produced in Texas, are no longer the reliable yardstick for the world price and a clear signal of demand for high quality oil from the world's biggest consumer that they once were. They have instead become more of an indicator of the degree of oversupply in the heart of the North American continent.
The most visible evidence of this disparity can be seen in the price of ICE Brent crude futures, the European benchmark; it has risen 21 percent this year, while WTI futures have gained only 15 percent. Normally trading at parity to WTI, Brent surged last week to a record premium of $17.
Although that spread has contracted sharply over the past few days, trading on Wednesday at about $10, the correction has brought its own set of problems. On Monday, for example, the two contracts moved sharply in opposite directions, sowing confusion about whether oil costs had gone up or down.
The result is that WTI, the light sweet crude that Americans have long associated with "the" price of oil, has become a dangerously inaccurate indicator.
And that has major implications for consumers and companies given that at $100 a barrel many economists see limited risk to the U.S. economy but at $120 serious headwinds become evident.
"The hike to something which is between $110 and $120 a barrel is something which may affect (growth) if it lasts too long," said International Monetary Fund chief Dominique Strauss-Kahn, during a visit to Panama last week.
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http://www.washingtontimes.com/news/2011/mar/17/rising-oil-prices-threaten-economic-crash/
ZUBRIN: Rising oil prices threaten economic crash
Unless we tap our domestic energy resources, we’ll pay in lost jobs
By Robert Zubrin
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The Washington Times
6:18 p.m., Thursday, March 17, 2011
MugshotChart: Oil price vs. unemployment rate
In recent days, oil prices have climbed above $100 per barrel. As chaos spreads through the Arab world, we could soon see much worse.
According to recent testimony given to Congress by Federal Reserve Chairman Ben S. Bernanke, the current soaring oil prices are no reason for concern. According to the stock market, which has dropped hundreds of points each time oil prices have edged up another dollar or two, the situation is a five-alarm emergency. Who is right?
The likely impact of a new oil-price rise is shown in the graph below, which compares oil prices (adjusted for inflation to 2010 dollars) to the U.S. unemployment rate from 1970 to the present. It can be seen that every oil-price increase for the past four decades, including those in 1973, 1979, 1991, 2001 and 2008, was followed shortly afterward by a sharp rise in American unemployment.
The distress to American workers caused by such events is manifest, but the economic damage goes far beyond the impact on the unemployed. A sustained oil price of $100 per barrel will add $520 billion to the U.S. balance-of-trade deficit. Furthermore, there is a direct and well-established relationship between unemployment rates and the rates of mortgage defaults. Thus, the $130-per-barrel oil shock of 2008 didn’t just throw 5 million Americans out of work, it made many of them default on their home payments and thus destroyed the value of the mortgage-backed securities held by America’s banks. This, in turn, threatened a general collapse of the financial system, with a bailout bill for $800 billion sent to the taxpayers as a result. But that is not all. The destruction of spending power of the unemployed and the draining of funds from everyone else to meet the direct and indirect costs of high oil prices reduce consumer demand for products of every type, thereby wrecking retail sales and the industries that depend upon them.
Indeed, the world today is already in deep recession. Yet as a result of the systematic constriction of oil production by the Organization of Petroleum Exporting Countries (OPEC), which is limiting its production rate to 1973 levels of 30 million barrels per day, petroleum prices stand at more than four times what they were in 2003. This has imposed a tax increase on our economy of $500 billion per year, equal in economic burden to a 20 percent increase in income taxes, except that instead of the cash going to Uncle Sam, it will go to Uncle Saud and his lesser brethren.
These governments, however, are said to be our “friends.” As current events in the Middle East should make clear, there is every chance that someday - perhaps soon - we could wake up and find that the world’s oil is under new management, even less concerned with our well-being than the gang in charge today.
This is a fundamental threat to the American economy. We need to take action to protect ourselves from it now, before it is too late. How can we do this?
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Speaking of Brazil, I gather that George Soros has a big piece of the off-shore drilling deal that the US govt is helping finance at favorable rates, , , sorry no citation.
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Gas is well over $4 a gallon in most places in California -- and soaring elsewhere as well. But are such high energy prices good or bad?
That should be a stupid question. Yet it is not when the Obama administration has stopped new domestic offshore oil exploration in many American waters, curbed oil leases in the West, and keeps oil-rich areas of Alaska exempt from drilling. Last week, President Obama went to Brazil and declared of that country's new offshore finds: "With the new oil finds off Brazil, President (Dilma) Rousseff has said that Brazil wants to be a major supplier of new stable sources of energy, and I've told her that the United States wants to be a major customer, which would be a win-win for both our countries."
Consider the logic of the president's Orwellian declaration: The United States in the last two years has restricted oil exploration of the sort Brazil is now rushing to embrace. We have run up more than $4 trillion in consecutive budget deficits during the Obama administration and are near federal insolvency. Therefore, the United States should be happy to borrow more money to purchase the sort of "new stable sources of energy" from Brazil's offshore wells that we most certainly will not develop off our own coasts.
It seems as if paying lots more for electricity and gas, in European fashion, was originally part of the president's new green agenda. He helped push cap-and-trade legislation through the House of Representatives in 2009. Had such Byzantine regulations become law, a recessionary economy would have sunk into depression. Obama appointed the incompetent Van Jones as "green jobs czar" -- until Jones' wild rantings confirmed that he knew nothing about his job description "to advance the administration's climate and energy initiatives."
At a time of trillion-dollar deficits, the administration is borrowing billions to promote high-speed rail, and is heavily invested in the federally subsidized $42,000 Government Motors Chevy Volt. Apparently the common denominator here is a deductive view that high energy prices will force Americans to emulate European centrally planned and state-run transportation.
That conclusion is not wild conspiracy theory, but simply the logical manifestation of many of the Obama administration's earlier campaign promises. Secretary of Energy Steven Chu -- now responsible for the formulation of American energy policy -- summed up his visions to the Wall Street Journal in 2008: "Somehow we have to figure out how to boost the price of gasoline to the levels in Europe." I think Chu is finally figuring out the "somehow."
A year earlier, Chu was more explicit in his general contempt for the sort of fuels that now keep Americans warm and on the road: "Coal is my worst nightmare. ... We have lots of fossil fuel. That's really both good and bad news. We won't run out of energy but there's enough carbon in the ground to really cook us."
In fairness to Chu, he was only amplifying what Obama himself outlined during the 2008 campaign. Today's soaring energy prices are exactly what candidate Obama once dreamed about: "Under my plan of a cap-and-trade system, electricity rates would necessarily skyrocket." Obama, like Chu, made that dream even more explicit in the case of coal "So, if somebody wants to build a coal plant, they can -- it's just that it will bankrupt them, because they are going to be charged a huge sum for all that greenhouse gas that's being emitted."
There are lots of ironies to these Alice-in-Wonderland energy fantasies. As the public become outraged over gas prices, a panicked Obama pivots to brag that we are pumping more oil than ever before -- but only for a time, and only because his predecessors approved the type of drilling he has stopped.
The entire climate-change movement, fairly or not, is now in shambles, thanks to serial scandals about faked research, consecutive record cold and wet winters in much of Europe and the United States, and the conflict-of-interest, get-rich schemes of prominent global-warming preachers such as Al Gore.
The administration's energy visions are formulated by academics and government bureaucrats who live mostly in cities with short commutes and have worked largely for public agencies. These utopians have no idea that without reasonably priced fuel and power, the self-employed farmer cannot produce food. The private plant operator cannot create plastics. And the trucker cannot bring goods to the consumer -- all the basics like lettuce, iPads and Levis that a highly educated, urbanized elite both enjoys and yet has no idea of how a distant someone else made their unbridled consumption possible.
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Can we post anything critical of Soros? I remember something about it being the peak of anti-semitism.....
http://hotair.com/archives/2009/08/18/good-news-obama-backs-off-shore-drilling/
Good news: Obama backs off-shore drilling! Update: A Soros connection?
Posted at 3:35 pm on August 18, 2009 by Ed Morrissey
This should be good news for the Drill Here, Drill Now contingent, right? The Obama administration has committed $2 billion in loans to exploit offshore oil resources in hopes of extracting a major new source of petroleum. Despite the White House pursuit of a cap-and-trade scheme to limit the use of fossil fuels, the new field could help bring lower energy prices, and their support of this exploration of American resources shows their flexibility on energy policy.
Wait — did I say American resources? That’s true, but only in the South American sense (via Gateway Pundit):
The U.S. is going to lend billions of dollars to Brazil’s state-owned oil company, Petrobras, to finance exploration of the huge offshore discovery in Brazil’s Tupi oil field in the Santos Basin near Rio de Janeiro. Brazil’s planning minister confirmed that White House National Security Adviser James Jones met this month with Brazilian officials to talk about the loan.
The U.S. Export-Import Bank tells us it has issued a “preliminary commitment” letter to Petrobras in the amount of $2 billion and has discussed with Brazil the possibility of increasing that amount. Ex-Im Bank says it has not decided whether the money will come in the form of a direct loan or loan guarantees. Either way, this corporate foreign aid may strike some readers as odd, given that the U.S. Treasury seems desperate for cash and Petrobras is one of the largest corporations in the Americas. …
But it still doesn’t allow the U.S. to explore in Alaska or along the East and West Coasts, which could be our equivalent of the Tupi oil fields, which are set to make Brazil a leading oil exporter. Americans are right to wonder why Mr. Obama is underwriting in Brazil what he won’t allow at home.
This seems odd in several ways. For this particular administration to offer billions in loans to a foreign oil company makes a mockery of a number of Obama talking points. First, why does Petrobas need loan guarantees to pursue its exploration? As the WSJ notes, it is a very large corporation, which should have the resources to get to the oil on its own. Obama, who has ripped American corporations for their supposed subsidies in American tax policy, now wants to use an empty Treasury to give cash to a Brazilian oil company.
Next, Obama keeps insisting that we cut back on our use of fossil fuels. He and his allies in Congress have blocked exploration of American oil fields off both shores for decades, and Obama insists that we would only keep enabling our oil addiction if we started drilling off of our own coasts. Yet he has no trouble committing $2,000,000,000 of our money for Brazil to drill off its own coast.
Here’s a proposal: Let American companies do what Obama is paying Brazilian companies to do — drill offshore. We won’t have to pay them money or float them any loans to do it, either. In fact, we will make money off of the leases, while the effort creates hundreds of thousands of high-paying jobs in the US, creating more tax revenue rather than emptying out the Treasury.
Update: Who else besides Obama has taken an interest in Petrobras? Hmmmmmm:
His New York-based hedge-fund firm, Soros Fund Management LLC, sold 22 million U.S.-listed common shares of Petrobras, as the Brazilian oil company is known, according to a filing today with the U.S. Securities and Exchange Commission. Soros bought 5.8 million of the company’s U.S.-traded preferred shares.
Soros is taking advantage of the spread between the two types of U.S.-listed Petrobras shares, said Luis Maizel, president of LM Capital Group LLC, which manages about $4 billion. The common shares were 21 percent more expensive than preferred today, according to data compiled by Bloomberg. …
Petrobras preferred shares have also a 10 percent additional dividend, said William Landers, a senior portfolio manager for Latin America at Blackrock Inc.
“Given that there will most likely never be a change in control in the company, I see no reason to pay a higher price for the common shares.” Brazil’s government controls Petrobras and has a majority stake of voting shares.
This story is from last Friday. Is it a coincidence that Obama backer George Soros repositioned himself in Petrobras to get dividends just a few days before Obama committed $2 billion in loans and guarantees for Petrobras’ offshore operations? Hmmmmmmmmmm.
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Pretty self explanatory:
(http://www.clusterflock.org/wp-content/uploads/2011/03/deathrateperwatts.jpg)
http://www.clusterflock.org/2011/03/info-graphic-out-of-context.html
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BBG, Thanks for posting the graphic; that picture tells the story I was unsuccessfully trying to tell in words. I just wasn't getting any traction with the comparison that the nuclear industry in America in all its history has fewer deaths than Ted Kennedy's car.
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Amtrak CEO ditches broken train to travel by car to ribbon cutting of Wilmington’s Joe Biden station
By Steven Nelson - The Daily Caller | Published: 11:20 AM 03/19/2011 | Updated: 1:39 PM 03/20/2011
By Steven Nelson - The Daily Caller
Bio | Archive | Email Steven Nelson
Get Steven Nelson Feed
Governor Edward G. Rendell (left) of Pennsylvania and Joseph Boardman, Amtrak president, unveiled their vision for high-speed East Coast service yesterday at a Philadelphia station. (Matt Rourke/ Associated Press)
55
Today’s the big day for Amtrak’s Wilmington train station. It is being renamed in honor of Vice President and former Delaware Senator Joe Biden following major renovations made possible with stimulus funds.
One problem: the CEO of Amtrak got stuck on the train.
ABC News Deputy Political Director & Political Reporter Michael Falcone tweeted at approximately 10 a.m. that the Acela train he was riding had been “delayed” in Baltimore and that he was sitting next to Amtrak CEO Joe Boardman.
Falcone tweeted, “Acela to NY delayed for ‘unknown period’ Should I feel better that the Amtrak CEO is sitting next to me?”
It quickly became apparent that the CEO’s presence wouldn’t fix the train. A subsequent tweet from Falcone noted, “BAD sign: Amtrak CEO Joe Boardman just got OFF the train to take a car to Wilmington.”
“Amtrak CEO abandoned his own train to make ribbon cutting ceremony for Joe Biden station in Wilmington,” Falcone reported. “When I told Amtrak CEO Joe Boardman it was a bad sign he was ditching the stranded Acela, he chuckled.”
An Amtrak spokesman offered “no comment” to ABC News on the incident.
The rechristening of the Wilmington station was scheduled to begin at noon, according to NBC Philadelphia.
TAGS: ACELA EXPRESS, AMTRAK, JOE BOARDMAN, MICHAEL FALCONE
http://dailycaller.com/2011/03/19/amtrak-ceo-ditches-broken-train-to-travel-by-car-to-ribbon-cutting-of-wilmingtons-joe-biden-station/
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2nd Post.
Dark Days For Solar Power
Published on February 22, 2011 by Edwin Feulner, Ph.D.
Ever heard of the Solyndra solar-cell plant in Fremont, Calif.? Most people haven’t. That’s a shame, considering how much taxpayer money has been poured into it.
Solyndra is in serious financial trouble. Despite getting a $535 million bailout - part of the taxpayer-funded “stimulus” - the company subsequently announced it would lay off more than 17 percent of its work force. It also had to close one of its manufacturing plants about a year after it got the money. The House Energy and Commerce Committee is launching an investigation.
That’s understandable. After all, it wasn’t supposed to turn out this way for Solyndra and other solar-cell producers. President Obama and Sen. Barbara Boxer both campaigned at the plant, touting the “green jobs” that would flow from government investment in companies that produce renewable energy.
How that bit of economic magic was supposed to occur is a mystery. Solyndra’s production costs are more than six times those of other producers. Even with strong backing from Washington, the company had to cancel a $300 million initial public offering after a bad audit from PricewaterhouseCoopers. As the New York Times noted in an article on Solyndra, “the project spotlights the risks of government intervention in a dynamic market.”
No kidding. The main problem isn’t renewable energy per se; it’s the folly of having government pick winners and losers in the energy market - or any market, for that matter.
When politicians spend our money, they aren’t thinking about what makes sense from a business perspective. They’re engaging in wishful thinking. They want to be able to say things like “green jobs are the wave of the future,” so they go out and sink millions of our dollars into companies that may or may not be wise investments. They get a photo op, a sound bite, some votes - and we get stuck with the bill.
You can think solar panels are the most wonderful thing in the world, but that doesn’t necessarily mean you should fund them. Consider this November headline from the San Jose Business Journal: “Solar Panel Glut Projected in 2011.” Supplies of the panels, the article predicts, will be nearly three times higher than demand this year.
Faced with a forecast like that, nobody with any business sense would invest in solar panels. But government would - with our money.
The same thing happened with a previous energy boondoggle: ethanol. The Energy Independence and Security Act of 2007 poured taxpayer money into the corn-based alternative fuel. Production rose from 4.3 billion gallons annually in 2006 to 12.5 billion gallons in 2009. Unfortunately, demand for ethanol that year was just 8.4 billion. Oops.
Believe it or not, though, some in Washington still won’t relent even when faced with facts like these. Efficiency doesn’t matter, they claim - government spending helps stimulate the economy, regardless.
Those who make this argument prove only one thing: They don’t understand basic economics. Every single dollar government spends on anything came from somewhere else. It had to be taxed - taken away from some other use by private persons - before being redistributed to others. Money that likely would have been invested more productively is taken out of circulation before being reallocated.
You can call that a lot of things, but “stimulus” isn’t one of them.
So what made Solyndra an attractive choice for government largesse? As Heritage Foundation energy expert David Kreutzer points out, it has more to do with political rates of return than economic ones: The company spent $140,000 on lobbyists in the first quarter of 2010.
In the end, though, it didn’t help. Maybe the government should have invested its money in a viable source of energy.
The rest of us, however, would benefit from more sunshine - shined, preferably, on special interests that waste our tax dollars, and the politicians who play along.
Ed Feulner is president of the Heritage Foundation.
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By STEVEN F. HAYWARD
The Obama administration's energy policy is in the midst of transition from being stubbornly ideological to being wholly incoherent. That much was clear when President Obama unveiled his Blueprint for a Secure Energy Future this week.
With gasoline prices climbing above $4 a gallon, the administration is talking about tapping our Strategic Petroleum Reserve in a desperate attempt to hold down pump prices. It's also expanding subsidies and incentives for energy supplies that cost a lot more than oil, and it's aiming to reduce our dependency on foreign oil by one-third over the next 10 years.
Meanwhile, in a bizarre turn, Mr. Obama recently expressed enthusiasm for aggressive offshore drilling—in Brazil.
At least the president is practicing the green virtue of recycling. His energy address featured all the greatest hits of past presidential declarations of energy independence, including even George W. Bush's paean to switchgrass ethanol. Yet Mr. Obama's energy "blueprint" will get no further than all previous presidential schemes for the same reason: It is unserious at its core.
There are only two ways to reduce our foreign oil imports: a large oil tax to suppress consumption, or expanded production of domestic oil resources. All of the other bells and whistles—hybrid and flex-fuel cars, biofuels, etc.—will have only a marginal effect on overall oil demand. Higher energy taxes are not in the cards. What about expanded domestic oil production? Mr. Obama tried to thread the needle by claiming to be pro-domestic production, while at the same time embracing the tired talking point that because the U.S. has only 2% of the world's proven oil reserves—about 20 billion barrels—we can't hope to achieve independence from foreign oil from our own resources.
Yet a recent report from the Congressional Research Service that has received surprisingly little attention concludes that the U.S. probably has as much as 155 billion barrels of oil recoverable with existing technology that we simply haven't looked for or have closed off from exploration for political reasons. That's five times the outdated and misleading figure Mr. Obama cites. And there are an additional 700 billion barrels of oil shale and other unconventional hydrocarbons that could be developed here at home. That's more than the oil reserves of Saudi Arabia.
Mr. Obama ought to tell the whole story about Brazil, instead of just half of it. He touts the measures Brazil took to improve its energy independence, such as flex-fuel vehicles and biofuels. And yes, Brazil has gone from importing 77% of its oil from foreign sources in 1980 to importing no oil by 2009. A great success story in conservation and alternative energy? Not really. Total Brazilian oil consumption still more than doubled.
The biggest factor is that Brazil increased its domestic oil production over the last two decades by 876% (not a typo). Most of that production has come from offshore exploration.
Brazilians achieved independence from foreign oil the old-fashioned way—they drilled. Instead of tapping our Strategic Petroleum Reserve, how about tapping into our still-in-the-ground oil reserves?
Mr. Hayward is a resident scholar at the American Enterprise Institute and the author of the forthcoming "Almanac of Environmental Trends" (Pacific Research Institute).
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The President’s New Energy Plan
What’s wrong with it? Just about everything.
If you want to lower the price of something, the best solution is to produce more of it. This is basic Econ 101 stuff. But nowhere in the administration’s new energy proposals, presented by the president this Wedesday in a speech at Georgetown University, is the idea of pumping more oil in the United States addressed, except to say it is impossible.
To reach this conclusion, the president had to speak a gross untruth, one he tells so often that he even felt a need to apologize before saying it again: that the United States sits on only 2 percent of the world’s oil supplies, while using 25 percent of the world’s oil. As I pointed out in an article recently, the Department of Energy, which most assuredly vetted this speech before it was released, has known for years this is wrong. In just one 35-miles-square area of the Midwest there is more recoverable oil than in the entire Middle East.
This may be just the tip of the iceberg. Oil shales throughout the region may hold trillions of barrels more. There may even be hundreds of billions more barrels off our coasts and in other areas from which they can be recovered relatively cheaply. We won’t know for a few years yet, as the administration will not let the oil companies look for it. Instead, the president presents the tired canard that 57 percent of onshore and 70 percent of offshore leases are not being developed — the implication being that since the companies are not fully exploiting their current resources, giving them access to more would not help.
Think about that. Oil companies can sell oil at over a $100 a barrel, and yet they are not developing these lands. Why would they do that? The simple answer is that the oil companies do not believe there is any oil in these areas. The argument Obama was pretending to refute is unaffected by this fact: Why not let the oil companies lease and develop the areas where we already know the oil is?
Rather than increasing the oil supply, Obama wants to invest (spend) money on all kinds of green initiatives. Of course, this comes with the promise of creating hundreds of thousands of “green jobs,” which is a reduction from the 5 million green jobs the president promised during his campaign. We should all be thankful the administration failed to keep that promise, as the Europeans already went down the green-jobs route, with devastating consequences. Independent studies in Britain and Spain show that every new green job cost 2.5 to 4 other wage earners their jobs.
Obama also placed a tremendous emphasis on increasing our production of biofuels. Never mind that we are already plowing-under a quarter of our corn supply, so as to turn it into an inefficient and costly fuel. Worse, this unprecedented destruction of food supplies is raising the price of food worldwide, sparking riots and upheavals on a global scale. In fact, rising food costs are the driving force sending many Arabs into the streets and adding a huge risk premium to the cost of oil. In no small measure, biofuels are the root cause of $4 gasoline — some irony.
The speech was not all bad, though. The president put his stamp of approval on natural-gas exploitation and reaffirmed his support for nuclear energy. It remains to be seen whether he will expend any political capital battling his environmental base on either issue. Still, he gave them lip-service, and one must sometimes be grateful for small mercies.
One might wonder if Obama understands how important oil is to maintaining a thriving economy, if it were not for the fact that he recognizes its importance to other nations. During his speech, he mentioned that one of the reasons he went to Brazil was to talk about how they could use American technology to develop recently discovered oil reserves off their coast. If only he was as keen to let American oil companies use their technology to search for and develop the fields off our own coasts.
Anyone who was expecting new ideas or directions for U.S. energy policies — so as to cope with $100 oil — must be chagrined. Instead, the president presented a litany of failed and failing policies that are already damaging the economy without solving our energy problems. The president went to Georgetown University to prove to Americans that he was taking the increasing price of energy seriously. It takes a true master to speak almost 6,000 words on the topic of reducing energy costs without ever addressing the one sure method of addressing those costs — drill, baby, drill.
What makes this speech truly special, though, is that every alternative Obama offered for expensive oil is more costly than oil itself.
We have to do better than this.
— Jim Lacey is the professor of strategic studies at the Marine War College and author of the forthcoming The First Clash. The views in this article are the author’s own and do not in any way represent the views or positions of the Department of Defense or any of its members.
http://www.nationalreview.com/articles/263568/president-s-new-energy-plan-jim-lacey
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Well here's a surprise. Bold added.
http://reason.com/blog/2011/04/05/new-study-free-carbon-permits
Unintended Consequences of Free Carbon Permits -- Burning More Coal
Ronald Bailey | April 5, 2011
Proponents of cap-and-trade carbon rationing argue that it will encourage inventors to develop and companies to adopt low-carbon energy technologies. A new study, "How emission certificate allocations distort fossil investments: The German example," [download here] by the German Economic Research Institute in Berlin finds that allocating emissions permits at the beginning the European Trading Scheme for free actually encouraged the "dash for coal" in Germany. Below are some excerpts detailing relevant findings:
Despite political activities to foster a low-carbon energy transition, Germany currently sees a considerable number of new coal power plants being added to its power mix. There are several possible drivers for this “dash for coal”, but it is widely accepted that windfall profits gained through free allocation of ETS certificates play an important role....
We find that technology specific new entrant provisions have substantially increased incentives to invest in hard coal plants compared to natural gas at the time of the ETS onset. Expected windfall profits compensated more than half the total capital costs of a hard coal plant....
While German policy-makers intended not to hamper investments in the power sector by carbon regulation, they designed an allocation scheme which in the end created perverse incentives and massively promoted investments into emission-intensive hard coal plants. Obviously, policy makers failed to take the effects of free allocation-related windfall profits on coal profitability into account. We have thus shown that the details of implementing carbon regulation can be extremely important in a dynamic perspective. Different allocation regimes may not just have distributive effects, but also important consequences for investment choices.
Although the analysis has a retrospective focus, our findings are relevant in support for current policy-making. We conclude that by introducing full auctioning of emission permits from 2013 on [National Allocation Plan III] (NAP III) Germany is providing the right incentives from an environmental perspective. However, the new coal capacity brought on the way has created a heavy burden for ambitious future transition to lower carbon intensity.
Back in 2009, the House of Representatives passed the Waxman-Markey cap-and-trade scheme which shared many elements of the European Trading Scheme such as giving away most emissions permits for free. In a commentary on the study the Breakthrough Institute (which advocates as an alternative to cap-and-trade that governments spend tens of billions researching low-carbon energy technologies) notes:
Back in 2009, Breakthrough Institute analysis warned that "high levels of offsetting allowed in Waxman-Markey [a bill which proposed to introduce an US cap and trade regime based on the EU model] and the substantial allocation of emissions allowances to coal-burning utilities and energy companies may make it more cost-competitive to build new coal plants." ...
The findings of Pahle's study are the latest in a series of major setbacks for cap and trade supporters around the world, most importantly the European Commission. After five years of out-of-control price volatility and reckless rent-seeking, profiteering, theft, fraud and speculation, it's really high time for the Commission to start recognizing the critique of cap and trade made in the influential Hartwell paper [which critiqued cap-and-trade and proposed massive low-carbon energy R&D spending as an alternative]. Not only is the EU ETS structurally flawed to begin with, but the entire idea of cap and trade is bound to produce such failure systemically, by its very nature.
Economist Alex Tabarrok makes a nice and relevant observation about the law of unintended consequences:
The law of unintended consequences is what happens when a simple system tries to regulate a complex system. The political system is simple, it operates with limited information (rational ignorance), short time horizons, low feedback, and poor and misaligned incentives. Society in contrast is a complex, evolving, high-feedback, incentive-driven system. When a simple system tries to regulate a complex system you often get unintended consequences.
Interestingly, the Breakthrough Institute analysts skip over the fact that the German study suggests that had the emissions permits been auctioned and the revenues recycled (in the manner of a carbon tax) by reducing income or other taxes, energy investments would have been more likely channeled toward lower carbon energy alternatives, e.g., natural gas. The folks over at the Breakthrough Institute clearly see some of the unintended consequences of cap-and-trade, are not so good at seeing what might go wrong with regard to the top-down centralized R&D spending policies they favor.
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Yes, but their intentions were good, and to liberals, that's all that matters.
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By Any Other Name, Energy Cuts Still Stink
Published on April 7, 2011 by David Kreutzer, Ph.D. BACKGROUNDER #2542
Abstract: Eighty-five percent of the energy that fuels the American economy is from coal, petroleum, and natural gas. An unavoidable by-product of burning these fuels is carbon dioxide (CO2). Analyses of the Waxman–Markey cap-and-trade bill make clear that CO2-reduction targets will not be met through increases in renewable energy production. So, cutting CO2 means cutting energy use; and cutting energy use means throttling economic growth. The President’s recently proposed clean-energy standard (CES) seeks cuts that are just as severe as those under Waxman–Markey.
When cap-and-trade legislation died last year, President Barack Obama famously said, “There is more than one way to skin a cat.” This may well be true, but the cat gets the same bad deal either way. So it is with global-warming legislation and the economy. Government-forced cuts in energy use, whether by cap and trade or by a clean-energy standard, would cut incomes and destroy jobs.
Eighty-five percent of the energy that fuels the American economy is from coal, petroleum, and natural gas. An unavoidable by-product of burning these fuels is carbon dioxide (CO2). Analyses of the Waxman–Markey cap-and-trade bill make clear that CO2-reduction targets will not be met through increases in renewable energy production.[1] So, cutting CO2 means cutting energy use; and cutting energy use means throttling economic growth. The President’s recently proposed clean-energy standard (CES) seeks cuts that are just as severe as those under Waxman–Markey.
While some ways of cutting CO2 emissions can impose greater inefficiencies than other ways, forcing cuts in CO2 pushes the economy below its best growth path. There are no silver-bullet solutions that avoid this problem.
Under cap and trade, the government creates an artificial scarcity of fossil fuels by limiting the CO2 emissions that burning these fuels inevitably creates, with impacts very similar to an energy tax. A CES can mandate identical CO2 cuts but implement these restrictions via an awkward and even less efficient set of mandates and regulations. The CES approach is at least as costly as the cap-and-trade proposals that Congress repeatedly rejected because of their extraordinary costs.
Taxing Milk
A hypothetical illustration may help clarify the economy-crushing impacts that a CES shares with a carbon tax or cap and trade.
Suppose the federal government imposed a tax on milk of $3 million per gallon. Further suppose that this tax suppresses demand such that only one person (presumably a very rich person) buys milk, and he buys only one gallon each year. The tax revenue would be $3 million per year—very small by Washington’s standards. In fact, some would claim that if a penny were rebated to all 300 million Americans, there would be no net impact from the tax, since $3 million would be both collected and distributed.
However, the dairy industry would be devastated by this tax as milk production drops from billions of gallons per year to a single gallon. The facilities that process milk would be shut down and their employees laid off. Dairy farmers would have to slaughter their herds and scrap their dairy houses. Innumerable other activities related to the dairy industry would stop, along with the jobs and value they generate for the economy. This lost economic activity (in economics jargon, the “excess burden” of the tax) is measured by lost national income—e.g., gross domestic product (GDP). This lost GDP, and not the $3 million collected and distributed, is the net cost of the tax. In addition, people would not have the health benefits and enjoyment of consuming dairy products.
Capping Milk
Suppose that instead of a $3 million per gallon tax, the government created a cap-and-trade program requiring a permit for each gallon of dairy products that is consumed. Further suppose that the permits are auctioned by the government to the highest bidder(s) and that they auction only one permit each year.
In this case, bidding for the permit (by the same rich consumer as in the tax example) would push its price to $3 million, and the impact would be identical to the $3 million dairy tax. The $3 million does its round trip through the government (the money comes from the one consumer and goes to whomever the government chooses) and the dairy industry is still decimated along with its jobs and contribution to GDP.
A Non-Dairy Agriculture Standard
Instead of using a milk tax or a cap-and-trade plan for milk, the government could create a non-dairy standard that specifies the fraction of agricultural output that must come from sources other than milk.
One gallon of milk represents about 0.0000000008 percent of total farm income. So a 0.9999999992 percent non-dairy standard for U.S. agriculture could also limit milk production to one gallon per year—decimating the dairy industry and cutting GDP as effectively as a $3 million per gallon tax or a one-gallon production/consumption cap. The only difference is that the government, in this case, does not collect and spend the $3 million.
Depending on how the standard is implemented, the price of milk may not rise. For instance, if the standard were achieved by mandating the use of disposable diamond-encrusted drinking cups for milk, the cost of drinking milk could be $3 million per gallon even though the price of milk may remain at $3.50 per gallon. Here the costly purchase of equipment necessary for consuming milk—not the milk’s price—is what drives the consumption down.
Why Mandated Conservation Is Costly
The average person needs about 1.5 gallons of water per day in direct consumption just for survival. Fortunately, most of us have access to many more gallons than that, and we can use water for all sorts of other valuable uses.
However, suppose the government set a target of limiting consumption for each person to 1.5 gallons. This goal could be met with a tax or cap-and-trade program—each of which would need a mechanism for significant transfers of wealth—or a simple but onerous law directing that no one can consume more than 1.5 gallons per day.
Because all water would be used for drinking, there would need to be alternatives for doing all the other important things currently done with water. Waterless laundry technology, waterless bathing technology, waterless industrial processes, waterless carwashes, etc., would all have to be developed and implemented. All of them would be costly, many very costly. In addition, there are likely some things for which there is no waterless substitute.
A program analogous to a CES for the water example would be to set standards that require use of the waterless technologies and ban activities where there is no waterless substitute. It might then be argued that consumers are saving money on water even though the overall cost of the various processes can be much higher.
In Hot Water
Proponents of efficiency standards often argue that even including the costs of the new, more expensive technology, the overall cost of the activities will fall over time. The implication here is that consumers and producers are unwilling to save money. A more likely explanation is that those contending that markets do not take full advantage of efficiency have themselves ignored other factors that should be included.
The author’s 1993 Maytag dishwasher used nine gallons of hot water and took 84 minutes to clean a normal load of dishes.[2] The current model Maytag dishwasher uses seven gallons of hot water and takes 120 minutes to clean a normal load of dishes.[3] This increase to a two- to three-hour cycle is typical and is the result of efficiency mandates that are met by using fewer gallons of water with much longer cycle times.[4]
The cost of two gallons of hot water is less than a dime. For many people, the additional cycle time of an energy-efficient dishwasher will be an inconvenience greatly exceeding the 10-cent savings. Some people would alter their behavior (sometimes washing their dishes by hand, for example), which could entirely offset these gains. However, the regulator’s calculation of savings ignores these costs. Markets, on the other hand, do not.
A Clean Energy Standard
In his State of the Union address, President Obama set a clean-energy target of 80 percent. That means that 80 percent of electric power must be generated by energy that he defines as clean. If the energy source emits colorless, odorless, non-toxic, necessary-component-for-photosynthesis CO2, then it gets tripped up on the President’s definition of clean. Though he listed natural gas in his list of clean-energy sources, subsequent comments out of the White House suggest that natural gas will receive only partial credit. That is, a fraction of natural gas generation will count toward the “clean” 80 percent, while a fraction will go toward the catch-all 20 percent.
Since natural gas emits about 60 percent as much CO2 as coal on an equivalent energy basis, it may receive only a 40 percent clean credit. If so, then Obama’s CES starts to look more and more like cap-and-trade, especially given the intention of allowing producers to trade clean-energy credits.
Each unit of electricity from natural gas emits about 0.6 times as much CO2 as coal-fired electricity.[5] Counting about 40 percent of gas-generated electricity as “clean” puts the current overall power mix at about (coincidentally) 40 percent “clean” and 60 percent “dirty.” To meet the overall goal of 80 percent “clean” by 2035 means that two-thirds of this “dirty” power needs to be transformed to “clean.” In other words, the CO2 emissions from power generation need to be cut by two-thirds by 2035.[6]
Cap and Trade by Comparison
The Environmental Protection Agency’s (EPA) analysis of the Waxman–Markey cap-and-trade bill projected CO2 cuts from electricity generation of about 60 percent by 2035. These cuts in electricity generation comprise about 85 percent of the overall cuts in CO2 emissions for the whole economy.[7]
Since the proposed CES seeks to cut 66 percent of CO2 emissions by 2035, the cuts proposed in the CES are comparable to, if not greater than, the cuts targeted under Waxman–Markey.
Further, the EPA analysis of Waxman–Markey projected a near doubling of nuclear power generation over the next 25 years. Given the Administration’s attempts to block access to developing the Yucca Mountain repository for nuclear waste, the fact that not one new nuclear power plant has been licensed for over 30 years, and the lack of nuclear regulation reform in the Administration’s discussion, building 70–100 nuclear power plants in the next 20 years is a heroic assumption. The recent events in Japan hardly increase the odds. In the absence of a nuclear renaissance, meeting the CES targets would be even more costly.
Costs of Cap and Trade
The Heritage Foundation’s Center for Data Analysis analyzed the economic impact of the Waxman–Markey cap-and-trade legislation. The bill would have had the following effects:
Cumulative national income losses, as measured by GDP, of $9.4 trillion between 2012 and 2035;
Single-year GDP losses reaching $400 billion by 2025 and ultimately exceeding $700 billion (note that the total economic damage from the recent earthquake and tsunami in Japan is projected to be $200 billion to $300 billion)[8]; and
Net job losses of 2.5 million in 2035.
A Less-Flexible Waxman–Markey
Though a CES may sound innocuous, the CES proposed by President Obama has targets that are nearly identical to the Waxman–Markey cap-and-trade bill. Since it has less flexibility in meeting these targets, it can be expected to have economic impacts that are at least as great. In short, it seems that the President’s CES is not so much another way of skinning the cat as it is another way of saying it.
David W. Kreutzer, Ph.D., is Research Fellow in Energy Economics and Climate Change in the Center for Data Analysis at The Heritage Foundation.
http://www.heritage.org/Research/Reports/2011/04/By-Any-Other-Name-Energy-Cuts-Still-Stink
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IMHO the article fails to mention the exceedlingly low margin requirements and understates the role of massive money supply increases by the Fed and elsewhere, but points out an interesting variable:
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Oil prices are once again pushing the highs that they hit in mid-2008. There’s any number of factors behind it, from OPEC quota levels to constrictions in supply toward the problems with Iran or in Libya. What STRATFOR, however, sees as the single largest factor pushing oil prices higher is simply the fact that there are more players in the market now than were 10 years ago. Until the late 1990s, most participants in the oil future markets were what was called “commercial investors” — industrial is probably a better way to think of that — players who actually provide crude oil and take delivery of crude oil to the market. But in the late 1990s and early 2000s a new type of investor, noncommercial investors, was able to participate in the market in large volumes. This was made possible by changes in technology, the advent of Internet technology for example, that allowed investors at a retail level to participate in the market in a different sort of way — buying and trading crude oil futures without actually every intending on providing or taking delivery of the product. The advent of Internet technology took this to a completely new level, allowing a new magnitude of investors to participate.
These technological changes occurred at the same time that the Baby Boomers matured. Mature workers are preparing for retirement. The kids have gone; college is paid for; the house is probably paid for. And so they’re socking away their money for retirement. A lot of that money has made it into various energy funds, artificially increasing the demand for those products. The difference between the year 2000 and the year 2011 couldn’t be more stark. Right now noncommercial investors, or what we just think of as investors, now make up for 40 percent of long positions in the market. A 40 percent increase in participation in a market that’s as inelastic as crude oil is going to send prices higher. Now this isn’t the only factor and it doesn’t rule every day but it does provide a structural support for the market that didn’t exist there. Now what these people are not is speculators. Speculators are people who are specifically betting on the price of oil and perhaps even trying to force it in a particular direction. These are the people the Obama administration is not particularly fond of.
This is a completely different phenomena from what were seen as the secular shift in energy prices over the last decade. Now what this mass of new investors does is provide this huge amount of liquidity and income support for anyone who wants to invest in crude. They’re providing the basis actually for increasing supply in the long run. There is, however, several side effects. One of course is higher prices. Another one is that they are often betting in opposition to what fundamental trends are doing. So, for example, if you have a situation where prices are rising, industrial consumers of crude are doing everything they can to cut demand — they want to limit their price and exposure. Not so for investors. They see prices rising and want to jump on that bandwagon. And so you get these weird moves in the market often with prices swinging wildly from extreme to extreme.
The most dramatic impact, of course, is when the fundamentals ultimately do win at the end of the day. This happened in mid-2008 when prices were $140 a barrel. Industrial consumers simply couldn’t support that kind of price level in the world was tipping into recession on a global scale. But investors were still pushing the price up and when they realized the fundamentals were correcting everything sharply to the downside, their mass removal from the market led to a price collapse of roughly three quarters of value. But there’s an additional factor that is actually making all of the waters even murkier. Over the course of the last six years, global money supply has roughly doubled in size. When you have all four of the major currency blocs increasing their currency by such a huge volume, collectively, that money is going to go somewhere. So we’ve seen a huge amount of capital from this monetary expansion moving commodities of all sorts and first and foremost oil.
There’s no indication at present that authorities in any of the four major currency blocs are going to take appreciable moves to restrict investment into commodities in the near future. In fact, that would probably be detrimental to the efficient functioning of the markets. But the investors are having an impact. Prices are volatile. They do move sharply up as well as very sharply down and this is going to remain the state of affairs at least as long as this monetary expansion is in progress.
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http://www.baltimoresun.com/business/sns-rt-business-us-markets-tre72d01w-20110314,0,559931.story
WEAKER DOLLAR SPURS COMMODITY BUYING
Oil's rise on a weaker dollar was part of a commodities buying binge, with gold setting a record above $1,500 an ounce, as persistent worries about U.S. fiscal health drove investors to seek alternative assets.
"Oil is up there with gold as an inflation hedge for investors," said Mike Zarembski, senior commodities analyst at optionsXpresss in Chicago.
At the same time, "everyone is still afraid to be short with the situation in the Middle East," Zarembski said.
The dollar index , which measures the greenback against a basket of currencies, was down 0.85 percent. A weaker U.S. currency can support dollar-denominated commodities by making them cheaper for holds of other currencies.
"The dollar index has broken significantly below a long-term multi-year trendline, so we could see the selling accelerate," said GFT market strategist David Morrison.
HIGHER OPEC OUTPUT?
The International Energy Agency's executive director, Nobuo Tanaka, issued the latest warning that high oil prices could reduce demand in top consumers the United States and China.
OPEC needs to boost output in June or July to douse further price rises, Tanaka said, adding that if crude prices stayed at $100 a barrel or more for the rest of 2011, the market could see demand destruction similar to that of 2008.
But OPEC itself sees oil prices between $80 and $90 as "adequate" and has no plans for an emergency meeting because the market is well supplied, Ecuador's Oil Minister, Wilson Pastor, told Reuters in an interview.
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http://reason.com/blog/2011/04/22/doj-forms-oil-and-gas-price-fr
DoJ Forms "Oil and Gas Price Fraud Working Group"
Matt Welch | April 22, 2011
Here's your federal energy policy: Do nothing significant to increase domestic supply, create mandates to have XX% of future supply come from magical green leprechauns, then when prices (surprise!) go up, you know what to do: Blame the "speculators":
Attorney General Eric Holder today announced the formation of a Financial Fraud Enforcement Task Force Working Group to focus specifically on fraud in the energy markets. The Oil and Gas Price Fraud Working Group will monitor oil and gas markets for potential violations of criminal or civil laws to safeguard against unlawful consumer harm. [...]
"Rapidly rising gasoline prices are pinching the pockets of consumers across the country," said Attorney General Holder. "We will be vigilant in monitoring the oil and gas markets for any wrongdoing so that consumers can be confident they are not paying higher prices as a result of illegal activity. If illegal conduct is responsible for increasing gas prices, state and federal authorities should take swift action."
Holder's "how high?" memo here [PDF]. President Barack Obama's money quote:
"The attorney general's putting together a team whose job it will be to root out any cases of fraud or manipulation in the oil markets that might affect gas prices – and that includes the role of traders and speculators," President Obama said at a town hall meeting in Nevada on Thursday. "We are going to make sure that no one is taking advantage of American consumers for their own short-term gain."
It says a lot about how debased our politics have become that we could have expected this kind of aggressive economic ignorance had the other party won the presidency, too.
More on the latest push here. Reason on oil speculation here and here.
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Someone told Holder it was supply and demand that was responsible for the high prices. Holder is planning on indicting them, as soon as he figures out who "Supply" and "Demand" are.
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http://www.forbes.com/2011/04/19/oil-futures-prices.html
Are Speculators Gouging Us At The Pump?
Jerry Taylor and Peter Van Doren, 04.19.11, 11:40 AM EDT
They aren't, so put away the torches and pitchforks.
With gasoline selling at around $4 per gallon, the political hunt is on to track down the ne're-do-wells responsible. The primary suspects seem to be Wall Street speculators who, we're told, are gaming the crude oil futures market to create price increases out of thin air. It is a tale, however, told by an idiot, full of sound and fury, signifying ignorance.
The only way to intelligently navigate this discussion is to know a bit about how futures markets work. The least you need to know is that in futures markets one buys the right to purchase oil at a future date at a specific price from someone who is selling that guarantee. Most futures contracts are for one to three months in advance but are settled daily after purchase.
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In Search of Petrovillains
The Delegator-in-Chief has announced the creation of yet another inert task force, this one forced upon the attorney general and tasked with examining the role of “traders and speculators” in skyrocketing gasoline prices. Technically this “working group,” as the administration is calling it, is a sub–task force of the extant Financial Fraud Enforcement Task Force, and will include representatives from the FTC, CFTC, FRB, SEC, USDA, etc. Presumably, when the group finishes its work at some indefinite point in the future, its findings will be carefully reviewed by a commission, which will then issue a handsomely bound report to a czar, who will finally inter it in a filing cabinet.
If the task force were merely impotent, it would silly enough. But it is also redundant. The Federal Trade Commission already covers this turf, having been equipped by several federal laws with the power to monitor and investigate instances of market manipulation at the pump. Its major work product, a congressionally mandated 2006 report on post-Katrina price spikes, failed to find a significant pattern of gouging. Moreover, the Dodd-Frank Wall Street–reform bill passed last July vested the Commodities Futures Trading Commission with sweeping new authority to combat speculation, requiring the commission to write new regulations within six months of passage — a deadline that body has, by the bye, blown by three months and counting. So it seems safe to conclude that gas prices are not rising because the organizational charts of our regulatory bureaucracies are insufficiently complex.
Nor are the putative “speculators” — “investors” is the right word — themselves half the problem they are made out to be. In fact, they play a critical role in the marketplace. Among other things, they help companies with serious financial exposure to fluctuating oil prices (such as airlines and trucking companies) hedge against rising fuel costs. Unlike the U.S. government, FedEx can’t just print money when its expenses go up. The futures market provides businesses — and governments — with critical intelligence about the state of supply and demand for petroleum. An intelligent administration, or one at least less hostile toward profit-making businesses, would be looking for a more robust market, with more market participants, rather than hunting for villains.
What is causing high gasoline prices? Increased demand associated with the global economic recovery and (greater than average) Mideast instability certainly play their part, as does the continued control of a major portion of proven petroleum reserves by OPEC, a paradigmatic cartel whose very raison d’être is market manipulation. But the operant cause here, the main event to which this speculator business is a sideshow, is the man himself: President Obama, and his say-one-thing-and-do-another energy policies. He demagogues on oil speculators because he can’t — he won’t — do anything else.
Explain away an economic calamity as the byproduct not of bad policies, but of evildoers gaming the system, and find a group rich and unpopular enough to fit the bill; the rhetoric comes from page one of the Obama playbook and recapitulates the sorry formula we saw at work in his deficit speech. (Thus the president sneaks into a weekly YouTube address on the topic of fuel prices a perfect non sequitur about government subsidies to rich oil companies. There are many good reasons to end this bit of corporatism, but it is exactly wrong to suggest it will redound to the benefit of consumers at the pump in the near term.)
Behind the doublespeak, the reality is that President Obama’s favored policies do nothing ease fuel prices, and more damning still, he doesn’t care. In 2008, when the national average was last peaking above $4 per gallon, candidate Obama made it clear that while he would have preferred a “gradual” increase, he saw ever-higher petroleum prices as a necessary antecedent and augur of our immaculate, green-energy future. And even now, as oil the Gulf of Mexico sits and waits for new permits and the EPA scuttles the latest effort to tap the estimated 27 billion barrels of crude sitting below Alaska’s north Arctic coast, the president assures us that “what’s driving oil prices up right now is not the lack of supply. There’s enough supply.” We agree, there is enough supply to meet current demand: at $4 dollars a gallon, and beyond.
http://www.nationalreview.com/articles/265582/search-petrovillains-editors
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A 5% margin rate (I believe I have this number correct) tends to magnify volatility too. Why does it seem like I am the only one who notices this?
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"A 5% margin rate (I believe I have this number correct) tends to magnify volatility too. Why does it seem like I am the only one who notices this?"
Because very few people invest on margins? I bet Obarry couldn't tell you what a margin rate is. He sure didn't understand P/E ratio.
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A fair question and one I am unable to answer. I have no idea what % of oil futures trading is done on margin or how large a % is necessary for it to affect volatility.
Anyone?
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Well, this is way outside my lane but to me, investing on margin sure seems to make gambling at a casino seem safe and prudent in comparison.
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For stocks the margin limit is now 50% I believe. For oil I do not know. Even at 50%, the volatility is doubled. Margin, which is borrowing, is no free lunch. If your gains are double, so are your losses. Like gold, the people betting against the economy and the currency happen to be right. These bets need to be flushed out with a strategy change - something like this: Monday open up drilling on the east coast. Tuesday, open the gulf. Wednesday, open up west coast drilling and one new nuclear site, Thursday open ANWR. Friday open up the Rocky Mountain region for wide expansion of natural gas production and announce 2 new pipelines. Then see what the speculators are speculating on. :-)
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I think you are correct about 50% for stocks, but IIRC, oil futures are 5%.
The mathematical implications need no expounding here from me.
This is why I keep raising this point in wonderment at its lack of mention elsewhere , , ,
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The Left Hates Oil Companies
That’s really what all this is about.
When oil prices blew sky high in 2008, ExxonMobil paid $36.5 billion in income taxes, $34.5 billion in sales taxes, and $45 billion in other taxes, for a total of $116.2 billion in taxes paid and collected in 2008. That’s according to Mark Perry at the Carpe Diem blog.
Exxon will report earnings later this week. And while oil prices aren’t quite as high today as they were three years ago, it’s all a bit like 2008.
I read somewhere that either Exxon or the whole oil industry pays more in taxes than the bottom 50 percent of the whole income-tax system. So while president Obama is out there ragging on oil companies to remove so-called tax subsidies, it’s odd that he doesn’t mention how much in taxes the energy firms actually pay to Uncle Sam.
There’s a laundry list of tax credits that go to oil, both large and small firms. Basically, these tax credits allow for the expensing of high-risk investment. That’s what this is about.
Of course, if you really wanted to stop expensive subsidies, you’d kill the ethanol subsidies that have a big carbon footprint and drive corn and wheat prices sky high. But the liberal-left progressives hate oil and gas companies, period. That’s really what all this is about.
Ironically, besides the usual plea for wind, solar, and biofuels — which amount to virtually nothing in terms of our energy use — the president does include natural gas. But natural gas is produced by oil and gas companies. And you have to drill for it. Therefore, oil expenses in the whole drilling process — including leases, permits, geology research, and dry holes, and then drilling, producing, lifting, and ultimately refining for sale — should be 100 percent expensed.
So it would be great if the president understood that you have to drill for natural gas. It also would be great if the president and his pals, instead of harping on a measly $4 billion a year in so-called subsidies (compare that with a $1.5 trillion deficit), focused on real pro-growth corporate-tax reform that drops the rates and includes permanent 100 percent expensing.
That’s pro growth. That’s tax reform. That will create more oil, more natural gas, and more gasoline. That would probably stabilize prices, assuming the Fed doesn’t totally destroy the dollar. That would generate millions of new jobs and lower unemployment. And that would be a good policy.
– Larry Kudlow, NRO’s Economics Editor, is host of CNBC’s The Kudlow Report and author of the daily web blog, Kudlow’s Money Politic$.
http://www.nationalreview.com/articles/265688/left-hates-oil-companies-larry-kudlow
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Are high gas prices a good thing?
That is not as dumb a question as it sounds. Examine a few revealing past remarks from President Obama and the cabinet officials who are now in charge of the nation’s energy use and oil leases on federal lands. Then decide whether the current soaring gas prices are supposed to be good or bad.
In 2008, Sen. Ken Salazar (D., Colo.) — now secretary of the interior, in charge of the leasing of federal oil lands — refused to vote for any new offshore drilling. In a Senate exchange with minority leader Mitch McConnell (R., Ky.), Salazar objected to allowing any drilling on America’s outer continental shelf — even if gas prices reached $10 a gallon. We can now see why the president appointed Salazar, inasmuch as Obama recently promised the Brazilians that he would be eager to buy their newfound offshore oil — while prohibiting similar exploration here at home.
From 2007 to 2008, Steven Chu, now secretary of energy, weighed in frequently on global warming and the desirable price of traditional energy. At one point Chu asserted, “Somehow we have to figure out how to boost the price of gasoline to the levels in Europe.” Chu also lamented, “We have lots of fossil fuel; that’s really both good and bad news. We won’t run out of energy, but there’s enough carbon in the ground to really cook us.”
In other words, $10 a gallon for gas would be desirable, while an enormous amount of recoverable American oil, gas, coal, tar sands, and oil shale should be left untapped.
During the 2008 campaign, Obama himself had strange ideas about the prospect of expensive prices for fossil-fuel-generated energy: “Under my plan of a cap-and-trade system, electricity rates would necessarily skyrocket.” Candidate Obama also elaborated on the envisioned role of his administration in ensuring such high prices: “So if somebody wants to build a coal-powered plant, they can. It’s just that it will bankrupt them.”
As for consumers’ plight in paying skyrocketing gas prices, the president, now and in the past, has sounded ambivalent. He recently told a questioner, “If you’re complaining about the price of gas and you’re only getting eight miles a gallon, you know, you might want to think about a trade-in.” Few large passenger vehicles today get only eight miles a gallon, and many squeezed Americans in recessionary times cannot so breezily think of “a trade-in.”
In 2008, Obama addressed consumer fears about climbing gas prices: “But we could save all the oil that they’re talking about getting off drilling, if everybody was just inflating their tires and getting regular tune-ups. You could actually save just as much.”
Note again the fantasy. Few of today’s cars have distributor points. New-generation spark plugs and computerized ignition usually ensure 75,000–100,000 miles without a so-called “tune-up.” There is no evidence that Americans’ tires are chronically underinflated, or if they were, that such negligence would waste more gasoline than all that could be recovered from new offshore oil drilling.
What explains the weird rhetoric from Obama and his administration? First, not long ago they considered high energy prices as not that bad. Government-sponsored mass transit and alternative-energy projects — from wind and solar to the federally subsidized Chevy Volt — pencil out only when gas gets expensive. And if you believe in man-made global warming, then the less coal, gas, or oil that Americans use, the better for the planet.
Second, a president who believes that modern cars get eight miles per gallon or need frequent tune-ups, and that proper tire inflation can substitute for drilling oil, has never run a business that hinged on having moderately priced gas to power a truck, tractor, or car fleet. In fact, most in the Obama administration came to Washington from either academia or prior state- and federal-government employment, where policy is theoretical, without grounding in real experience.
So much of this administration’s talk about energy sounds similar to a bull session in the faculty lounge, or what we would expect from lifelong bureaucrats and public functionaries who have never experienced long commutes or struggles in the harsher, profit-driven private workplace.
Now the global economy is recovering and energy use is climbing, as the U.S. dollar sinks. The oil-rich Middle East is in chaos. And more than 2 billion people in India and China are desperate for imported oil. The result is that American gas prices are astronomical, and the public is furious and starting to demand relief from the administration.
Its answer? Simple: Since reelection looms, the administration now insists that high energy prices are no longer good, but suddenly bad. And the evil oil companies are mostly to blame!
— Victor Davis Hanson is a classicist and historian at the Hoover Institution, Stanford University, and the author, most recently, of The Father of Us All: War and History, Ancient and Modern. You can reach him by e-mailing author@victorhanson.com.
http://www.nationalreview.com/articles/265809/are-sky-high-gas-prices-good-victor-davis-hanson
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http://directorblue.blogspot.com/2011/04/gas-pump-sticky-note-campaign-makes-its.html
The Sticky Note Campaign
I'll be doing this.
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Looks no different than graffiti to me.
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GM:
I like it :-D
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"Looks no different than graffiti to me."
This from the same guy that thinks that removing products from grocery store shelves is a lawful form of non-violent protest.
Sticky notes can be removed and easily thrown away (Or recycled, if you wish), as opposed to paint/markers or etching tools doing damage to surfaces.
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Surely you jest; you are pulling my leg. :-o
Do you, does anyone want to go grocery shopping everyday and have to fight through competing political stickies up and down the aisle?
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I'm sure store employees and/or angry Obamabots will quickly remove the stickies before the shelves/gas pumps collapse under their weight. It's just a small bit of guerilla marketing.
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http://www.pjtv.com/?cmd=mpg&mpid=174&load=5344
Don't make me get my sticky pad and sharpie out.... :-D
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I'm sure store employees and/or angry Obamabots will quickly remove the stickies before the shelves/gas pumps collapse under their weight. It's just a small bit of guerilla marketing.
And maybe they will leave up the thousands of stickies mocking the Republicans? :-D
I'm neutral here; I don't want to read stickies from the right, the left, or anybody's stickies when I do my grocery shopping.
Anyway, enough on stickies! :-)
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http://stopshouting.blogspot.com/2011/04/ten-rules-for-liberty-guerillas.html
Thursday, April 28, 2011
TEN RULES FOR LIBERTY GUERRILLAS
The "Post-it" Note campaign is going viral!
Facebook Campaign
Sticky Campaign Goes Viral
Part of the charade employed by the existing Regime is to continue to make people believe that they are alone in their dissent and/or dissatisfaction with the ruling class. They need to isolate you and make you feel YOU are the outlier. A recent example is the derision lobbed at those who questioned Obama's background and credentials.
This has been written about extensively in various professional military training manuals. It has also been the subject of many papers, dissecting the evolution of an underground movement that overthrew an entrenched Regime, where to outsiders, the “sudden collapse” of an oppressive regime catches them by surprise, when in fact, it was predictable all along.
The reason for the “sudden collapse” is that the group knowledge finally reached a tipping point, where the “dissenters” realize that they are the MAJORITY, not the minority as the Regime would have them believe.
Sticky notes, as advocated at gas pumps and on stores shelves, represent what is known as “Counter propaganda”.
TEN RULES FOR LIBERTY GUERRILLAS:
1. It is important to maintain a belief in final victory. Morale is everything.
2. Large numbers of [counter propaganda] appearing day after day, night after night, everywhere, will make the Regime nervous and raise the self-confidence of the population since such activities demonstrate the inefficiency of the existing Regime and the power and strength of the resistance movement.
3. Whenever practical, successful guerrilla forces use non-electronic means to communicate.
4. It is a principle of political science that it is easier to persuade people to vote against something or someone than to persuade them to vote in favor of something.
5. Liberty guerrillas form centers of resistance EVERYWHERE and they are always in action. Thus, when the Regime attempts to confront/solve one "media" crisis of anti-Regime opinion, another flares up. This serves to also drain the Regime's manpower and resources.
6. Always, always, ALWAYS be on the offensive.
7. Short, snappy slogans spread the message. Advertising/marketing gurus know that to gain traction, a slogan must be 7 words or less.
"BE ALL THAT YOU CAN BE".
Turn the tables on the opposition: Palin's "Obama: WTF indeed" is classic.
8. Mix it up. Never be predictable. But always be lawful.
9. Undermine the Regime's morale and their propaganda by exposing their methods and by constant emphasis on the unjustness of their cause and effects on the population.
(Higher prices? Thanks, Obama).
10. Exploit the alternative media to communicate the ideas of the Liberty movement and resistance to the Regime. Be everywhere; be informed; make it known you are aware of the lies disseminated by the Regime and aren't falling for them.
THE MOMENTUM IS ON OUR SIDE. Do not be deterred!
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My wife gave me a post-it sticky pad 8-) Lets post future comments about this campaign on The Way forward for the American Creed thread.
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http://abcnews.go.com/Business/wireStory?id=13491739
Pump Prices Jump to $3.91 on Tightening Supplies
By SANDY SHORE AP Business Writer
April 29, 2011 (AP)
Gas pump prices across the country rose to within a dime of $4 a gallon Friday, as weather-related refinery outages tightened supplies and pushed prices up.
The national average increased 2 cents to nearly $3.91 a gallon for regular gasoline. It's the highest level since July 31, 2008, when pump prices were falling from a record $4.11 a gallon on July 17 of that year.
Drivers in nine states and the District of Columbia already pay $4 a gallon or more for gas. At the current rate of increase, the national average could reach $4 by May 8, Analysts expect it to start falling later in the month, as refineries return to full production and more gas becomes available.
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Obama’s Muddled Energy Policy
High prices are good! No, wait, they’re bad!
If the Obama administration’s energy policy were the script for an old Keystone Kops silent movie, it would be comical. But since energy policy is, in fact, a crucial component of righting this nation’s economic ship, it is anything but funny.
Consider: President Obama entered office with a plan for an “economy-wide” cap-and-trade system that was expressly intended to make conventional fossil fuels more expensive, in order to encourage greater use of less efficient alternative sources of energy. By encouraging alternative sources of energy, the administration reckoned, America would gain energy independence. The outcome would be a new, robust “clean-energy economy.” Cap-and-trade was his cornerstone policy initiative.
That was two years ago. Cap-and-trade, however, proved to be politically unpopular. Moreover, inflationary monetary policy, a devalued U.S. dollar, and global economic growth outside the U.S. have pushed up the prices of energy. So the president is now campaigning against high energy prices. High energy prices “hobble our economy,” he’s argued, and he recently averred that the administration “is in conversations with the major oil producers like Saudi Arabia” to encourage them to produce more oil. Moreover, in early April he traveled to Brazil to congratulate that nation on its expanded offshore oil drilling and pledged that the U.S. would import more Brazilian oil.
In sum, in the first half of Obama’s term, we were told that high energy prices would be good, and thus America ought to adopt a policy to push up the costs of using oil and gas to lessen our reliance on imports. Now, in the second half of his term, we’re being told that high energy prices are bad, so we need to encourage more foreign oil production for the U.S. to import.
Recently, however, things have gotten even more confusing. President Obama has renewed his call to end tax incentives for U.S. oil exploration and production. He wants to end the oil depletion allowance, which lets U.S. oil producers cover the cost of capital expenditures. It is a standard deduction for the cost of doing business, like allowing depreciation for machinery in a manufacturing company. What is most mind-boggling, however, is that this proposal comes on the heels of his Brazil trip, which was tied in to the approval of a subsidized loan from the U.S. Export-Import Bank to help Petrobras, the Brazilian national oil company, expand its oil production. In short, he’s proposing to increase the cost of oil production in the U.S. while approving subsidies for foreign oil production.
The one constant in Obama’s energy policy, though, is his commitment to renewable energy. That hasn’t changed since his cap-and-trade proposal. In fact, the $4 billion saved from the proposed end to the depletion allowance on U.S.-production oil would go to fund even more subsidies for renewable energy.
To put such a swap in context, consider that the U.S. produces more than 2 billion barrels of oil a year. The depletion allowance equates to about five cents per gallon of crude (there are 42 gallons in a barrel). Ethanol, by comparison, receives a subsidy of 45 cents per gallon in the form of a credit on excise taxes that are levied on motor fuel. In short, gasoline is taxed, ethanol is not. Additionally, so-called cellulosic ethanol (made from things like wood, grasses, and plant waste) receives what the Congressional Budget Office calculates as a $3.00-per-gallon subsidy. These subsidies are on top of a federal mandate that ethanol must be used in the fuel supply.
Subsidies aside, President Obama’s plans to revolutionize the economy and gain American energy independence through renewable sources are mislaid. First, ethanol is less efficient than gasoline: Cars get lower mileage on ethanol. Second, supplies are limited. Despite the subsidies and the mandate, there is still not a commercial supply of cellulosic ethanol. Federal law requires the use of 250 million gallons of cellulosic ethanol in 2011, yet according to the Environmental Protection Agency, which administers the mandate, only 6 million gallons will be produced this year in the U.S. This is the second year in a row in which cellulosic production has not met the mandated federal minimum.
The case of corn ethanol has farther-reaching implications. This year ethanol will account for approximately 40 percent of the U.S. corn supply. This has added to food-price inflation, not only domestically but globally. The U.S. is the largest supplier of corn in the world — approximately 70 percent of the world’s tradable corn supply is from the U.S. — so American ethanol policy has serious repercussions for global food stability. Consider this in the context of President Obama’s admonitions to Saudi Arabia about their oil output — they’re a country that is food-deficient and relies on food imports, and our energy policy is helping to destabilize the world food trade.
Moreover, recent history shows that there are reliability issues in using crops as feedstocks for energy. Drought in the U.S. heartland last summer caused corn yields to fall short, leading to the critical supply-and-demand situation we now face. Corn prices in April 2010, before the drought, averaged $3.54 per bushel. Corn prices this April are near $7.50 per bushel. And a wet spring has significantly delayed plantings so far in 2011, raising the possibility of further low yields and even higher prices to come.
Finally, because of the Rube Goldberg nature of our renewable-energy policies, with their subsidies, regulations, and mandates, taxpayer-subsidized U.S. corn ethanol is being exported, while mandates to use non-corn ethanol are — because of the shortfall of cellulosic — being filled by imported sugar ethanol from Brazil, to which a 54-cent-per-gallon tariff is applied. Ironically, with its expanded oil production, Brazil has announced that it will lower its ethanol mandate in order to lower fuel prices domestically. Currently, there is a 25 percent ethanol requirement in Brazil; it will be dropped to 18–20 percent this spring, according to government officials there.
U.S. energy policy needs to encourage domestic oil production, find a realistic and viable role for renewable and alternative sources of energy, and recognize natural-resource and economic realities, domestically and globally. A comprehensive approach based on these principles would be the most productive path toward U.S. energy security and economic stability in the energy sector.
— Dave Juday is an adjunct fellow of the Center for Global Food Issues.
http://www.nationalreview.com/articles/266131/obamas-muddled-energy-policy-dave-juday
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Amtrak: 40 Years, $40 Billion
For National Train Day, let’s look at the company’s financial failures.
There is a special event coming down the tracks tomorrow — National Train Day. It’s likely few Americans, other than Amtrak enthusiast Vice President Joe Biden, put this date on their calendars. Amtrak, which created the holiday in 2008, will be using this day to kick off its year-long 40th-anniversary celebration. Supporters of Amtrak’s sister endeavor, high-speed rail, will also use the day to push for more funding.
Given America’s soft spot for trains — Thomas the Tank Engine and The Little Engine That Could are still popular among children — lawmakers are likely to be running to the nearest station for a photo op with those shiny engine cars. But instead of celebrating Amtrak’s anniversary, they should shine a light on the company’s financial failures and take its difficulties under advisement when considering costly new investments in high-speed rail.
When Congress created it in 1970, Amtrak was intended to be a profitable enterprise; instead, it has cost taxpayers a total of $40 billion. According to a 2009 study by the Pew Charitable Trust, 41 of Amtrak’s 44 lines lost money in 2008. Per-passenger losses ranged from $5 per passenger on the Northeast Regional to $462 on the Sunset Limited line, which runs all the way from New Orleans to Los Angeles. According to the Amtrak inspector general’s September 2010 semiannual report, the rail service covered only about 84 percent of its operating costs in fiscal year 2010.
Of course, Amtrak could save tax dollars by cutting its less profitable lines, but the anniversary-celebration lineup makes it clear that this engine of wasteful spending is accelerating. According to Amtrak’s Facebook page, the rail service will introduce four new P-42 diesel-electric trains, each with a “historic paint scheme,” and a separate “exhibit train” that will travel through the country for a year carrying educational exhibits; publish a book called “Amtrak: An American Story”; release a DVD on its history; and launch an anniversary website. In addition, Gladys Knight is acting as National Train Day spokesperson.
Defenders of Amtrak — and of high-speed rail — argue that most of the nation’s transportation industry is subsidized. Amtrak’s subsidy, however, is by far the most generous. According to a 2009 study by the Heritage Foundation, Amtrak subsidies totaled $237.53 per 1,000 passenger-miles. In contrast, the subsidy for commercial aviation was $4.23. These subsidies don’t make train travel more affordable. Randal O’Toole of the Cato Institute notes a one-way ticket between Washington, D.C., and New York City on Amtrak’s high-speed Acela costs $139, while bus service costs less than $15.
Taxpayers understand that if the government can’t turn a profit on lower-cost, low-speed rail (Amtrak), it will never earn a dime on higher-cost, high-speed rail. That’s why some governors, including Florida’s Rick Scott (R) and Ohio’s John Kasich (R), have said “No, thank you” to high-speed-rail funding that would put state taxpayers on the hook for years to come.
In preparation for a possible government shutdown in April, Amtrak president Joe Boardman instructed workers not to worry, because the company could still rely on ticket revenues to operate. That is, if Amtrak had to live without taxpayer subsidies, it would remain in business. The only difference is that it would be forced — like any other business — to cut unprofitable ventures and to meet its bottom line. Since, according to the Heritage Foundation, Amtrak accounts for 0.5 percent of all interstate passenger travel, and 40 percent of that travel occurs in the Northeast Corridor, it is unlikely most Americans would even notice such a change in service.
Across the country, many businesses, including other transportation services, have found ways to improve their bottom lines. Amtrak won’t be forced to make those types of decisions until taxpayer support is derailed. It is time for Congress to end Amtrak subsidies, consider the costly lessons learned, and apply them to the debate over high-speed rail.”
— Tom Schatz is president of Citizens Against Government Waste, a national nonprofit devoted to eliminating waste, mismanagement, and inefficiency in the federal government.
http://www.nationalreview.com/articles/266575/amtrak-40-years-40-billion-tom-schatz
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http://reason.com/archives/2011/05/10/environmentalists-were-for-fr
Reason Magazine
Environmentalists Were For Fracking Before They Were Against It
Shale gas is still the bridge fuel to a low-carbon energy future.
Ronald Bailey | May 10, 2011
The world’s projected natural gas supplies jumped 40 percent last year. How is such a thing possible? Until a decade ago, experts believed that it would be technically infeasible to exploit the potential resource base of natural gas locked in 48 shale basins in 32 countries around the world. Then horizontal drilling combined with hydraulic fracturing, also known as fracking, was perfected. The shale gas rush was on, and last year the U.S. Energy Information Administration (EIA) issued an analysis revising its estimates of available natural gas dramatically upward.
The ability to produce clean burning natural gas from shale could transform the global energy economy. Right now we burn about 7 trillion cubic feet (tcf) of natural gas to generate about 24 percent of the electricity used in the United States. The U.S. burns a total of 23 tcf annually to heat homes and to supply industrial processes as well produce electricity. Burning coal produces about 45 percent of U.S. electricity.
A rough calculation suggests that 100 percent of coal-powered electricity generation could be replaced by burning an additional 14 tcf of natural gas, boosting overall consumption to 37 tcf per year. The EIA estimates total U.S. natural gas reserves at 2,543 tcf. This suggests that the U.S. has enough natural gas to last about 70 years if it entirely replaced the current level of coal-powered electricity generation.
Similarly, it would be notionally possible to replace the entire current U.S. gasoline consumption with about 17 tcf of natural gas per year. So replacing coal and gasoline immediately would require burning 54 tcf annually, implying a nearly 50 year supply of natural gas.
What about the greenhouse gas implications? The EIA estimates that the U.S. emitted 5.2 billion tons of carbon dioxide in 2009 (the last year for which figures are available). Burning coal emitted 1.75 billion metric tons of carbon dioxide into the atmosphere. Similarly, burning petroleum in the transportation sector emitted 1.7 billion metric tons of CO2, of which about two-thirds came from consuming gasoline. By comparison, the natural gas burned to generate electricity emitted 373 million metric tons of CO2. A rough calculation suggests that replacing coal and gasoline with natural gas would reduce overall U.S. carbon dioxide emissions by about 25 percent.
Given its greenhouse gas benefits, environmental activists initially welcomed shale gas. For example, in August 2009 prominent liberals Timothy Wirth and John Podesta, writing on behalf of the Energy Future Coalition, hailed shale gas as “a bridge fuel to a 21st-century energy economy that relies on efficiency, renewable sources, and low-carbon fossil fuels such as natural gas.” The same year, environmentalist Robert Kennedy, Jr., head of the Waterkeeper Alliance, declared in the Financial Times, “In the short term, natural gas is an obvious bridge fuel to the ‘new’ energy economy.”
That was then, but this is now. Practically en masse, the herd of independent minds that constitutes the environmentalist community has now collectively decided that natural gas is a “bridge to nowhere.” Why? In his excellent overview, The Shale Gas Shock [download], published last week by the London-based Global Warming Policy Foundation, journalist Matt Ridley explains: “As it became apparent that shale gas was a competitive threat to renewable energy as well as to coal, the green movement has turned against shale.”
And indeed natural gas is cheaper than renewable sources of energy even if one includes the costs of carbon capture and sequestration. The EIA’s Annual Energy Outlook for 2011 calculates the levelized costs of electric power generation for various fuel sources. Levelized costs include all capital, operating and maintenance, fuel, and transmission costs for building plants now that would switch on by 2016.
In cost terms, natural gas is the clear winner. Electricity produced using natural gas in a combined cycle generating plant comes in at $66 per megawatt-hour. If one includes carbon capture and sequestration, basically burying carbon dioxide underground, the cost rises to $89 per megawatt-hour. In contrast conventional coal costs $95 per megawatt-hour rising to $136 using carbon capture and sequestration.
How does natural gas compare with various carbon-free and renewable energy sources? Nuclear clocks in at $104 per Mwh, offshore wind at $243 per Mwh, photovoltaic at $211 per Mwh, solar thermal at $312 per Mwh, geothermal at $102 per Mwh, and biomass at $113 per Mwh. The only renewable sources that are close to competitive with natural gas are onshore wind at $97 per Mwh and hydroelectric at $86 per Mwh. With regard to transportation, the price of compressed natural gas currently hovers around the equivalent of $2 per gallon of gasoline.
Keep in mind that the above is just a thought experiment. Junking coal-fired plants and dramatically expanding natural gas production as well as the infrastructure to burn it to generate electricity and dispense it as transport fuel would be costly. Increased demand for natural gas would also tend to boost its price.
Since renewables come off so badly in comparison with natural gas and offer energy independence as well, once-enthusiastic activists evidently began to search for other reasons for opposing it. Ridley cites five claims: fracking fluids contain dangerous chemicals that might contaminate groundwater; wells allow gas to escape into aquifers; well waste water is contaminated with salt and radioactive elements that pollute streams; it uses too much freshwater; and drilling damages landscapes.
First, the shale that contains natural gas lies below thousands of feet of impermeable rock so that the fracking process itself will not contaminate drinking water aquifers that are generally only a few hundred feet below the surface at most. A 2010 Pennsylvania Department of Environmental Protection report “concluded that no groundwater pollution or disruption of underground sources of drinking water have been attributed to hydraulic fracturing of deep gas formations.”
On the other hand, the drilling companies did their industry no favors by keeping their proprietary fracking fluid formulas secret. The cloak-and-dagger approach alarmed the sorts of folks who are easily alarmed. But as Ridley points out, the fracking fluids are actually 99.9 percent water and sand. The small amounts of added chemicals reduce friction, fight microbes, and prevent scaling. In any case, many states are now requiring companies to reveal their formulas. The U.S. Environmental Protection Agency is expected to issue a report on the safety of fracking in 2012. In the meantime, the Obama administration appointed a new panel last week to look into fracking and make recommendations in 90 days on how to improve on the safety of the technique. It is unlikely that whatever new regulations that emanate from these bureaucracies will derail the shale gas industry.
Just as for conventional wells, it is possible that natural gas can escape into aquifers if the wells are not properly sealed using steel and cement casings. A new study in the Proceedings of the National Academy of Sciences published today finds elevated levels of natural gas in groundwater wells within 3,000 feet of active gas well sites. The researchers conclude that the source is likely leaky casings.
However, the study more reassuringly “found no evidence for contamination of the shallow wells near active drilling sites from deep brines and/or fracturing fluids.” In any case, should their findings stand up to subsequent research, the problem is not fracking, but improperly sealed well-casings. It should be noted that the wells were not tested for methane before gas drilling began. It would be interesting to repeat the study looking at conventional gas wells.
But what about radioactive contamination of streams by well waste water? The Pennsylvania Department of Environmental Protection announced that after checking samples from waste water plants that had treated gas well water, it found that “all samples were at or below background levels of radioactivity; and all samples showed levels below the federal drinking water standard for Radium 226 and 228.”
With regard to using too much fresh water, Ridley points out that gas drilling in Pennsylvania uses about 60 million gallons per day, which compares to 1,550 million gallons used by public water systems. Ridley also notes that each well site takes up about six acres to extract gas beneath 1,000 acres which is largely left alone once a well begins producing. Ridley notes that “each wellhead capable of producing gas from up to 12 wells, or about 50 billion cubic feet over 25 years, the output of one drilling pad is equivalent to the average output of about 47 giant 2.5 megawatt wind turbines.” Speaking of intrusions into the landscape, that many turbines would typically take up 188 acres of land.
Finally, an April study in the journal Climatic Change by a team of researchers led by ecologist Robert Howarth from Cornell University suggested that the greenhouse gas emissions released by natural gas production are worse than coal when it comes to man-made global warming. Natural gas is methane, and methane, on a molecule per molecule basis, has a much greater ability to trap heat from the sun than does carbon dioxide. Howarth claims that methane leaking from natural gas wells contributes so much to global warming that the benefits of substituting it for coal are overwhelmed.
Critics have pointed to a number of problems with this study including the fact that it uses a global warming potential factor of 105 over 20 years compared to carbon dioxide. In contrast, the United Nations Intergovernmental Panel on Climate Change generally prefers using a factor of 25 over a 100-year period. In addition, Howarth bases his leakage data on long distance Russian gas pipelines and by assuming that “lost and unaccounted for gas” is not mostly an accounting measure. Lost and unaccounted for gas includes the gas burned to run the turbines to keep pipelines pressurized. It is early days, but my bet is that further research will find that Howarth’s claims are considerably exaggerated.
No industrial process is completely benign and all have environmental consequences. The relevant question is: Do the benefits outweigh the costs? Are people better off using the resource than they would otherwise be? If one is worried about man-made global warming, natural gas remains the affordable way to supply lower carbon energy to the world as technologists work to bring renewable energy costs down. Let's hope that environmentalists will recognize the current faults of wind and solar and fall in love with natural gas all over again.
Science Correspondent Ronald Bailey is author of Liberation Biology: The Scientific and Moral Case for the Biotech Revolution (Prometheus Books).
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After oil prices surged past $100 a barrel in 2008, suspicions that traders had manipulated the market led to Congressional hearings and regulatory investigations. But they produced no solid cases in the record run-up in gasoline prices.
Related
Ahmadinejad Backs Out of Key Role at OPEC (May 25, 2011) But on Tuesday, federal commodities regulators filed a civil lawsuit against two obscure traders in Australia and California and three American and international firms.
The suit says that in early 2008 they tried to hoard nearly two-thirds of the available supply of a crucial American market for crude oil, then abruptly dumped it and improperly pocketed $50 million.
The regulators from the Commodity Futures Trading Commission would not say whether the agency was conducting any other investigations into oil speculation. With oil prices climbing again this year, President Obama has asked Attorney General Eric H. Holder Jr. to set up a working group to look into fraud in oil and gas markets and “safeguard against unlawful consumer harm.”
In the case filed Tuesday, the defendants — James T. Dyer of Australia, Nicholas J. Wildgoose of Rancho Santa Fe, Calif., and three related companies, Parnon Energy of California, Arcadia Petroleum of Britain and Arcadia Energy, a Swiss company — have told regulators they deny they manipulated the market.
If the United States proves the claims, the defendants may give up $50 million in profits that were believed to be made as a result of the manipulation and also pay a penalty of up to $150 million.
The commodities agency says the case involves a complex scheme that relied on the close relationship between physical oil prices and the prices of financial futures, which move in parallel.
In a matter of a few weeks in January 2008, the defendants built up large positions in the oil futures market on exchanges in New York and London, according to the suit, filed in the Federal Court in the Southern District of New York.
At the same time, they bought millions of barrels of physical crude oil at Cushing, Okla., one of the main delivery sites for West Texas Intermediate, the benchmark for American oil, the suit says. They bought the oil even though they had no commercial need for it, giving the market the impression of a shortage, the complaint says.
At one point they had such a dominant position that they owned about 4.6 million barrels of crude oil, estimating that this represented two-thirds of the seven million barrels of excess oil then available at Cushing, according to lawsuits.
This type of oil is also the main driver of prices of the futures contracts, and their actions caused futures prices to rise, the authorities say. “They wanted to lull market participants into believing that supply would remain tight,” the agency said. “They knew that as long as the market believed that supply was tight and getting even tighter, there would be upward pressure on the prices of W.T.I. for February delivery relative to March delivery, which was their goal.”
The traders in mid-January cashed out their futures position, and then a few days later began to bet on a decline in oil futures, with Mr. Wildgoose remarking in an e-mail about the “inevitable puking” of their position on an unsuspecting market, the federal lawsuit says.
In one day, Jan. 25, they then dumped most of their holdings of West Texas Intermediate oil, and profited by the drop in futures.
The traders repeated the buying and selling in March 2008, and were preparing to do it again in April but stopped when investigators contacted them for information, the suit says.
Between January and April, average gas prices rose roughly to $3.50 a gallon, from $3. It was not until later in 2008, after the defendants had ceased their reported actions, that oil prices soared higher — reaching $145 that July. By the end of the year, prices had fallen to about $44. The Texas oil is now around $100.
Many other factors were at work, including tight oil supplies in the Middle East and fears that a growing global economy would consume more oil. Yet the enforcement action by the commodities regulator was the first credible evidence that a small group of traders also played a role in manipulating prices.
“This will help to satisfy the desire to find a culprit and throw them under the wheels of justice,” said Michael Lynch, an oil market specialist at Strategic Energy and Economic Research, a consulting firm.
Calls to Arcadia Petroleum in London were not immediately returned. A person who answered the phone at Arcadia Energy in Switzerland said that he was unaware of the complaints and that Mr. Dyer and Mr. Wildgoose were on vacation and unavailable for comment.
In the last few years, the commission has settled a handful of cases of manipulation in the natural gas market.
In 2007, it settled charges for $1 million against the Marathon Petroleum Company for trying to manipulate West Texas Intermediate crude oil in 2003.
The agency brought an action similar to its latest case in 2008, asserting that Optiver Holding, a proprietary trading fund based in the Netherlands with a Chicago affiliate, used a trading program in 2007 to issue orders to manipulate the crude oil market. The case is pending. It involved claims of manipulation of futures contracts for light sweet crude, New York Harbor heating oil and New York Harbor gasoline.
Clifford Krauss contributed reporting.
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"Oil Traders sued by Feds"
- That should help the supply of oil... (sarc.)
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I wonder if Michelle Obama again has never before been this proud to see our country ranked 44th freest in the world for oil production, unable to keep up with freedom bastions like Angola ranked 18th:
"It is almost as if the United States deliberately wanted to be more dependent on foreign oil. Consider that while the World Economic Forum rates the U.S. 4th in its ranking of the world's most competitive economies, it would rank far down the list if the WEF were to look at the competitiveness of the oil and gas industry in isolation. A proprietary ranking of political and investment risk for oil and gas by IHS's Petroleum Economics and Policy Solutions unit places the U.S. 44th, below several African nations such as Angola, which is ranked 18th. As an IHS analyst observes, in the U.S. "there is the constant threat of adverse contract or fiscal regime changes at both the state and federal levels of government. None of these threats or business risks is present in Angola." "
http://www.powerlineblog.com/archives/2011/05/029102.php
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What kind of economic OR security strategy involves decades of blocking the energy production needed to power our economy. It isn't just taxes and debt that are killing us, and these are self-inflicted wounds.
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Germany does about face on nuclear energy post Japan.
****German energy
Nuclear? Nein, danke
A nuclear phase-out leaves German energy policy in a muddle
Jun 2nd 2011 | BERLIN | from the print edition Economist
EVERYONE was horrified by the earthquake and tsunami that killed 24,000 Japanese and caused three nuclear meltdowns. But in Germany the feeling was laced with terror. Suspicion of nuclear power became mass revulsion. At a recent race in Berlin sponsored by Vattenfall, which generates nuclear power, many runners carried no-nuke flags.
The response of Chancellor Angela Merkel has been called the swiftest change of political course since unification. Only last year her government overturned a decade-old decision to phase out nuclear power by 2022. After Japan she suspended that policy and yanked seven of Germany’s 17 reactors off the electricity grid. On May 30th she completed her U-turn. The plan to keep nuclear plants operating for 12 more years was scrapped; the seven reactors will be shut for good. Germany will be “the first big industrial country to shift to highly efficient and renewable energy, with all the opportunities that offers,” Mrs Merkel promised. Industry is less thrilled about losing nuclear, which provides 23% of Germany’s electricity reliably and cheaply. It “fills me with worry,” said Hans-Peter Keitel, president of the Federation of German Industries.
The “energy transformation” is neither as revolutionary as Mrs Merkel suggests nor as hazardous as industry fears. Germany is returning to its policy of seven months ago. It has surplus generating capacity and low prices that are unlikely to rise much in the next few years, notes Mark Lewis of Deutsche Bank. Mrs Merkel’s shift was already under way. In 2000 30% of electricity came from nuclear. Since then, renewables like solar and wind have expanded their share from 6.6% to 16.5%.
The new plan is meant to make it easier to raise this share. But Mrs Merkel is also using Germans’ nuclear fears to smash their aversion to new infrastructure. The Bundestag is due to approve eight laws by the end of June to facilitate this. Yet the task depends also on citizens’ participation. “What is your contribution?” Mrs Merkel asks people. She hopes for political revival. Her Christian Democratic Union (CDU) was pushed into third place behind the Social Democrats and the Greens in Bremen in May for the first time at state level. While slowing the Greens’ rise, she also wants the CDU to seem a possible coalition partner after the federal election in 2013.
The nuclear reversal burnishes her credentials as a moderniser. Whether it will help Europe’s strongest economy is less clear. The rise in fickle solar and wind power increases the risk of instability in electricity supplies; with the closure of seven reactors, “we are really going to the limits,” says Christian Schneller of TenneT, a Dutch-German transmission company. Congestion on lines carrying power from north to south raises the risk of blackouts.
Germany promises neither to increase imports from nuclear neighbours nor to emit more greenhouse gases than planned. That will be hard. “You can’t have a liberalised energy market and close the border,” says Manuel Frondel of RWI, a research institute. Germany will emit an extra 370m tonnes of CO2 as it replaces nuclear with gas- and coal-fired plants. Europe’s emissions are capped by an emission-trading scheme, but the costs will now rise for everybody. Germany’s own goal is more ambitious: a 40% reduction from 1990 by 2020. This will not be met, says Mr Frondel.
Mr Schneller says the pace of progress on infrastructure must dictate the energy mix, not the other way around. Of the 3,500km (2,175 miles) of transmission lines that are needed to carry renewable power from (largely northern) sources to southern and western consumers, just 90km have been built. “Monster masts” provoke almost as much opposition as nuclear reactors. To shift fully to renewables, Germany needs to boost storage capacity by a factor of 500.
The government plans to speed up planning and licensing, as it did after unification. Progress is to be monitored, perhaps by a new parliamentary watchdog. The government may set up a “national energy transformation forum” to enlist citizens. If greenhouse-gas emissions rise faster than planned, says Mrs Merkel, conservation will have to improve.
Germany cannot do all this on its own, argues Ottmar Edenhofer of the Potsdam Institute for Climate Impact Research. Big efficiency gains will come only if Europe’s carbon cap includes housing and transport. Ramping up renewables would make more sense if Germany tapped into sunnier and windier parts of Europe, which requires a pan-European electricity grid. “Scaling up can only be done on a European level,” says Mr Edenhofer.
Germany did not become a role model by being hard-headed. Its subsidies for renewable energy are wasteful and its nuclear pull-out looks panicky. In short, the post-nuclear recoil carries risks of its own. Yet if anyone can make it all work, says Mr Lewis, the Germans can.
from the print edition | Europe ****
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Not admitted in the piece is that one of Germany's ideas for replacing nuclear, is to ... but nuclear power from France. That shifts all this do-goodery over to simply not-in-my-backyard politics.
BTW, what the hell does abandoning nuclear have to do with helping Europe meet its carbon cap. Nuclear was the most carbon free of any source mentioned!
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French land always has the potential of becoming German land.
Just saying......
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I hadn't thought of that - the new, west Germany.
Perhaps that is why France is so helpful in Libya. Obama threatened going back to historic (1943) borders; Sarchozy believes those to be indefensible.
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I hadn't thought of that - the new, west Germany.
Perhaps that is why France is so helpful in Libya. Obama threatened going back to historic (1943) borders; Sarchozy believes those to be indefensible.
Bwahahahahaha! Well done, sir!
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Moving along to a story about energy prices hitting the pocketbook. I believe this to be more a part of energy policy than monetary inflation, which may also be true.
Update: I must add that our energy policies are also driving up food costs and shortages. Who could have seen this coming??
Gas tanks are draining family budgets
AP http://news.yahoo.com/s/ap/20110527/ap_on_bi_ge/us_gasoline_summer_squeeze
By JONATHAN FAHEY, AP Energy Writer May 27, 6:01 pm ET
NEW YORK – There's less money this summer for hotel rooms, surfboards and bathing suits. It's all going into the gas tank.
High prices at the pump are putting a squeeze on the family budget as the traditional summer driving season begins. For every $10 the typical household earns before taxes, almost a full dollar now goes toward gas, a 40 percent bigger bite than normal.
Households spent an average of $369 on gas last month. In April 2009, they spent just $201. Families now spend more filling up than they spend on cars, clothes or recreation. Last year, they spent less on gasoline than each of those things.
"We used to do it a lot more, but not as much now," ... "You have to cut back when you have a $480 gas bill a month."
As Memorial Day weekend opens, the nationwide average for a gallon of unleaded is $3.81. Though prices have drifted lower in recent days, analysts expect average price for 2011 to come in higher than the previous record, $3.25 in 2008. A year ago, gas cost $2.76.
The squeeze is happening at a time when most people aren't getting raises, even as the economy recovers.
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"Perhaps that is why France is so helpful in Libya"
I think the reason they are so "helpful" in N. Africa is they don't want anymore Muslim refugess flooding their country.
They and Italy (and I guess all of Europe) are getting swamped with Muslims.
Their version of the Mexican, C. and S. American invasions here.
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I have no opinion over the validity of the expressed concerns over contamination of the water table. We certainly would not want the equivalent of a BP Gulf blow out!
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By ROBERT BRYCE
The U.S. is on the verge of an industrial renaissance if—and it's a big if—policy makers don't foul it up by restricting the ability of drillers to use the technology that's making a renaissance possible: hydraulic fracturing.
The shale drilling boom now underway in Texas, Louisiana, Pennsylvania, Oklahoma and other states is already creating jobs, slashing natural-gas prices, and spurring billions of dollars of investment in new production capacity for critical commodities like steel and petrochemicals. Better yet, it's spurring a huge increase in domestic oil production, which has been falling steadily since the 1970s.
Despite the myriad benefits of the low-cost hydrocarbons that are now being produced thanks to hydraulic fracturing, the media, environmental groups and politicians are hyping the possible dangers of the process, which uses high-pressure pumps to force water, sand and chemicals into shale formations. Doing so fractures the formation and allows the extraction of natural gas or petroleum.
Although hydraulic fracturing has been used more than one million times in the U.S. over the past 60 years, environmental activists are hoping to ban the process or have it regulated by the Environmental Protection Agency (EPA). Opponents claim the process can harm groundwater even though drinking-water aquifers are separated by as much as two miles of impermeable rock from the shales that are being targeted by the fracturing process.
New York currently has a moratorium on hydraulic fracturing. On May 31, New York Attorney General Eric Schneiderman sued several federal agencies, claiming they had not done a proper environmental assessment on the possible effects of drilling in the New York City watershed. On June 6, the New York Assembly passed a bill that will ban all forms of hydraulic fracturing in the state until mid-2012. And the EPA has launched "a comprehensive research study" on the possible "adverse impact that hydraulic fracturing may have on water quality and public health" nationwide.
View Full Image
David Klein
.Despite the opposition, some of America's biggest industrial companies are evangelizing about the merits of natural gas. Among the most fervent advocates are John Surma, the CEO of U.S. Steel, and Dan DiMicco, the CEO of Nucor. Mr. Surma told me in an interview that the shale revolution is "the first bit of good news in U.S. manufacturing in two decades." Mr. DiMicco went further, telling me that "we could change the entire manufacturing base in the U.S. if we just embrace what's happening in natural gas."
In March, Nucor, America's biggest steel producer, broke ground on a new $750 million direct-reduced-iron (DRI) plant in Louisiana. The plant's key commodity is low-cost natural gas, which will be superheated and then mixed with iron ore pellets and scrap in a furnace. The DRI process allows companies to produce about the same amount of steel with about a quarter of the capital they'd need to build a conventional integrated steel plant. And they can produce that steel with lower carbon-dioxide emissions because they are replacing metallurgical coal with methane.
Nucor may ultimately invest $3 billion in Louisiana on plants that could create as many as 1,000 permanent, high-paying jobs. Meanwhile, U.S. Steel may soon build a DRI plant of its own.
Thanks to hydraulic fracturing, U.S. drillers are producing lots of ethane and propane, which are key feedstocks for the petrochemical sector. Last October, Chevron Phillips Chemical Company announced plans to build a new plant in Baytown, Texas that will provide components for the production of polyethylene, a plastic resin used to make milk jugs and beverage containers. A few months later, the company said it was examining the feasibility of building a major petrochemical plant on the Gulf Coast.
In April, Dow Chemical announced plant expansions at several facilities in Louisiana and Texas, including construction of a new ethylene plant on the Gulf Coast that will begin operating in 2017 and a new propylene production facility that will begin operating by 2015. Dow's reason for the expansions: "competitively priced ethane and propane feedstocks." And last week Shell announced that it is developing plans to build a large ethylene plant in the Appalachian region. Ethylene and propylene are building blocks for a wide variety of consumer products including plastics, fibers and lubricants.
The drilling industry itself is creating jobs. Over the past 12 months, some 48,000 people were hired in Pennsylvania by companies working in the Marcellus Shale, a massive deposit that underlies several Eastern states, including Pennsylvania and New York.
While the Pennsylvania economy is getting a much-needed lift from drilling, opposition in New York may mean that the state loses out on jobs and investment. A new study by Tim Considine, an energy economist at the University of Wyoming, estimates that drilling in the Marcellus Shale could add as many as 15,000 new jobs to the New York economy by 2015. The study, conducted for the Manhattan Institute (a think tank where I am a senior fellow), estimated that shale drilling in New York could add some $1.7 billion to the state's economy by 2015 and increase the state's tax revenue by more than $200 million.
Regardless of what happens in New York, hydraulic fracturing is unlocking huge quantities of oil from shale. In March, domestic crude production was 5.63 million barrels per day, the highest level since 2003. Amazingly, production is rising despite the Obama administration's de facto moratorium on drilling in the Gulf of Mexico. And shale oil production will likely continue rising from deposits like the Bakken Shale in North Dakota, where state officials are predicting output will hit 700,000 barrels per day by 2018, double the state's current production.
A vibrant industrial base requires cheap, abundant and reliable sources of energy. The shale revolution now underway is the best news for North American energy since the discovery of the East Texas Field in 1930. We can't afford to let fear of a proven technology stop the much-needed resurgence of American industry.
Mr. Bryce is a senior fellow at the Manhattan Institute. His fourth book, "Power Hungry: The Myths of 'Green' Energy and the Real Fuels of the Future" (PublicAffairs), was recently published in paperback.
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Electric cars may not be so green after all, says British study
Ben Webster From: The Times June 10, 2011 3:23PM 15 comments
A Jaguar electric car goes on show at a preview event for the 2010 Los Angeles Auto Show. Picture: AFP Source: AFP
ELECTRIC cars could produce higher emissions over their lifetimes than petrol equivalents because of the energy consumed in making their batteries, a study has found.
An electric car owner would have to drive at least 129,000km before producing a net saving in CO2. Many electric cars will not travel that far in their lifetime because they typically have a range of less than 145km on a single charge and are unsuitable for long trips. Even those driven 160,000km would save only about a tonne of CO2 over their lifetimes.
The British study, which is the first analysis of the full lifetime emissions of electric cars covering manufacturing, driving and disposal, undermines the case for tackling climate change by the rapid introduction of electric cars.
The Committee on Climate Change, the UK government watchdog, has called for the number of electric cars on Britain's roads to increase from a few hundred now to 1.7 million by 2020.
Britain's Department for Transport is spending $66 million over the next year giving up to 8,600 buyers of electric cars a grant of $7700 towards the purchase price. Ministers are considering extending the scheme.
The study was commissioned by the Low Carbon Vehicle Partnership, which is jointly funded by the British government and the car industry. It found that a mid-size electric car would produce 23.1 tonnes of CO2 over its lifetime, compared with 24 tonnes for a similar petrol car. Emissions from manufacturing electric cars are at least 50 per cent higher because batteries are made from materials such as lithium, copper and refined silicon, which require much energy to be processed.
Many electric cars are expected to need a replacement battery after a few years. Once the emissions from producing the second battery are added in, the total CO2 from producing an electric car rises to 12.6 tonnes, compared with 5.6 tonnes for a petrol car. Disposal also produces double the emissions because of the energy consumed in recovering and recycling metals in the battery. The study also took into account carbon emitted to generate the grid electricity consumed.
Greg Archer, director of Low CVP, said the industry should state the full lifecycle emissions of cars rather than just tailpipe emissions, to avoid misleading consumers. He said that drivers wanting to minimise emissions could be better off buying a small, efficient petrol or diesel car. “People have to match the technology to their particular needs,” he said.
The Times
http://www.theaustralian.com.au/news/health-science/electric-cars-may-not-be-so-green-after-all-says-british-study/story-e6frg8y6-1226073103576
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Woof All:
Given the game-changing potential of US natural gas reserves for energy independence AND the serious questions presented concerning allegations of risk of pollution of the water table, this seems to me to be an important development.
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By BEN CASSELMAN
The natural-gas industry, bowing to longtime pressure, will disclose more information about the chemicals it uses in the controversial process of hydraulic fracturing.
View Full Image
Associated Press
Opponents of hydraulic fracturing at an April protest in New York.
On Friday, Texas Gov. Rick Perry signed into law a bill that will require companies to make public the chemicals they use on every hydraulic fracturing job in the state. While a handful of other states have passed similar measures, Texas's law is significant because oil and gas drilling is a key industry in the state and the industry vocally supported the measure.
Environmental groups said the law doesn't go far enough, but they agreed it was an important step.
Until recently, much of the industry opposed providing detailed information about its chemicals, arguing that they are trade secrets. But in recent months, as drilling opponents have accused companies of secrecy, many industry leaders have come to view that position as untenable.
"We have seen the light," Aubrey McClendon, chief executive of gas producer Chesapeake Energy Corp., told investors when asked about chemical disclosure at the company's annual meeting earlier this month.
Hydraulic fracturing, sometimes called "fracking," involves blasting millions of gallons of water, sand and chemicals into the ground to break up oil and gas-bearing rocks. The process has been used for decades, but it has become far more common in recent years as it has been used to open up huge new gas fields in Texas, Louisiana, Pennsylvania and other states.
Environmental groups and some residents in drilling areas fear chemicals from the hydraulic fracturing process are seeping into drinking water supplies. They say companies should be forced to disclose information about the chemicals they use, in part so homeowners can test their water for contamination.
The industry says such contamination is impossible when wells are constructed properly, adding that tens of thousands of wells have been drilled and fractured with relatively few problems. There have been cases of problems with wells that were improperly constructed, but the industry says such cases are rare and many specific incidents are in dispute. Companies say chemicals make up less than 1% of the volume of most fracturing jobs and are mostly benign.
For drillers, though, making that argument was difficult when they were refusing to say what chemicals were being used. Information on chemicals was available at drilling sites, but environmental groups have criticized that information as incomplete and inaccessible to the general public.
"I think the one thing hopefully that we all learned is you can't just say, 'Take our word for it,'"said Matt Pitzarella, a spokesman for gas producer Range Resources Corp.
Last year, Range Resources said it would begin voluntarily disclosing the chemicals used in all its wells in Pennsylvania, where the debate has raged. The company said at the time it hoped others would follow suit.
Earlier this year, many big gas producers, including Chesapeake, Chevron Corp. and BP PLC, said they would begin voluntarily publicizing the chemicals online at FracFocus.org. Several states, including Wyoming and Arkansas, have recently passed mandatory disclosure rules with at least tacit industry support.
Environmental groups, saying neither FracFocus nor the state laws go far enough, have called for a mandatory, national chemical database.
"Regardless of what state you live in, we think you deserve to know," said Amy Mall, a senior policy analyst with the Natural Resources Defense Council, an environmental group.
The Texas law will require companies to post information on FracFocus.org starting next year and also to disclose chemicals not included in the site's database through a separate process. Companies can request that information on certain chemicals be withheld from the public as trade secrets.
The Texas bill drew strong support from much of the industry. In May, a group of 12 big gas producers, including Range, Anadarko Petroleum Corp. and Apache Corp., wrote to Texas legislators urging them to pass the bill.
Jim Keffer, a Republican state representative who co-authored the Texas bill, said he believes the law will help the industry. "We're trying to alleviate the concerns," he said. "We're trying to show people that the industry does know how to do this."
The Texas bill has drawn mixed reviews from environmental groups. The Environmental Defense Fund, which initially helped promote the bill, ultimately withdrew its support after various changes were made, including the provision to list some chemicals separately from others.
But Matt Watson, a senior energy policy manager for the group, said that while the bill "is not the national model we'd hoped for," it is nonetheless a significant step.
Write to Ben Casselman at ben.casselman@wsj.com
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Yet another contemptible action by our Commander in Chief, who, for purely political and economically illiterate reasons is releasing 30 million barrels of oil from our Strategic Oil Reserve. :x :x :x By the way, an additional detail, not widely known: The salt caverns in which the oil is stored, deteriorate somewhat every time oil is taken out and then replaced.
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Yet another contemptible action by our Commander in Chief, who, for purely political and economically illiterate reasons is releasing 30 million barrels of oil from our Strategic Oil Reserve. :x :x :x By the way, an additional detail, not widely known: The salt caverns in which the oil is stored, deteriorate somewhat every time oil is taken out and then replaced.
Another brilliant move. I guess anything is better than domestic oil production.
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By the way, an additional detail, not widely known: The salt caverns in which the oil is stored, deteriorate somewhat every time oil is taken out and then replaced.
In 2009, the federal government found that Bayou Choctaw Cavern 20 near Baton Rouge, Louisiana had “structural problems that pose an environmental risk.” On February 16, 2011, Energy Secretary Steven Chu testified before Congress that: “We have an issue with one of our reservoirs. And there's one cavern that has some integrity issues. And we're draining that and backfilling other storage locations. But we're concerned of an overfill in those stores' locations. And so… we don't want to lose this crude.”
The senators say that tapping this oil now will help consumers, prevent a major oil leak, and ensure that hundreds of millions of dollars of crude oil is not wasted.
“Selling this oil now makes sense from both an economic and an environmental standpoint. The cavern has structural integrity issues and we need to move the oil to avoid losing it. Selling it now will prevent a potential environmental hazard, reduce prices at the pump in the short term, and create additional revenue to pay for restoring the reserve in a new, safer location. Letting this oil just seep into salt caverns would be both fiscally and strategically irresponsible,” said Reed, the Chairman of the Appropriations Subcommittee on the Interior and Environment.
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Remember the flap over foreign ships and the Deepwater Horizon cleanup?
By:Mark Tapscott | Editorial Page Editor Follow Him @mtapscott | 06/24/11 7:12 AM.
Soon after the Deepwater Horizon disaster began, with raw crude pumping out of the seabed into the Gulf of Mexico in the worst oil spill in American history, foreign nations began offering help with the clean up.
Especially notable was the Belgian firm DEME, which specializes in ocean-going clean-up work and which offered to bring the best equipment in the world for the operation to the Gulf.
But it didn't happen because President Obama refused to waive the Jones Act, a protectionist law sought by the maritime unions to keep foreign-crewed vessels out of U.S. waters.
The Jones Act has a national-emergency provision that allows the president to waive its requirement of American crews, as President George W. Bush did during the Hurricane Katrina disaster that nearly destroyed New Orleans.
But Obama resolutely refused last year to waive the Jones Act in order to allow the DEME and other equipment offered by foreign nations to be brought to the Deepwater Horizon cleanup. An operation that could have been completed in four months instead stretched into nearly a year.
But this week we have learned that under certain well-defined conditions Obama is more than willing to set aside his reservations about waiving the Jones Act. And those conditions have mainly to do with the fact Obama wants to be re-elected in 2012.
Among the biggest obstacles to Obama's re-election effort is the prospect that gas will still be around $4 a gallon next year. So what does Obama do? Not only does he authorize using 30 million barrels of oil from the U.S. Strategic Petroleum Reserve, he waives the Jones Act to allow foreign crewed ships to deliver the SPR oil to U.S. ports.
That decision left Jim Adam, president and CEO of the Offshore Marine Service Association, bewildered and angry. He issued this statement:
"It is mind-boggling that the president would jeopardize national security by letting foreign owned and operated ships transport oil from our Strategic Petroleum Reserve to and from American ports. (Ironically, the President had earlier cited Libyan unrest as a national security emergency in order to tap those reserves.)
"For more than a year, the Obama Administration has had a stranglehold on energy development in the Gulf of Mexico, which has put tens of thousands of Americans out of work.
"The administration talks incessantly about the importance of safety and environmental compliance by industry, but when those regulations stand in the way of the President’s agenda, he doesn’t hesitate to do the opposite.
"Foreign-flagged vessels do not have to comply with U.S. safety and environmental standards. They do not pay U.S. taxes. And most certain, they do not employ U.S. workers."
Obviously, Adams simply fails to understand the fact that millions of barrels of raw crude was gushing into the deep waters of the Gulf of Mexico was not nearly enough of a national emergency to justify waiving the Jones Act compared to the extreme urgency of getting those gas prices down so voters won't take it out on Obama at polls in November 2012.
Now there's a real national emergency!
For more from Adams, go here. And a hearty Friday morning HT to Dan Kish, senior vice president of the Institute for Energy Research, for pointing out this latest fascinating insight into Obama's thinking on energy issues.
Read more at the Washington Examiner: http://washingtonexaminer.com/blogs/beltway-confidential/2011/06/remember-flap-over-foreign-ships-and-deepwater-horizon-cleanup
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So, the Deepwater Horizon spill isn't an emergency worth waiving the Jones Act over, but the alleged problems at the Choctaw cavern is?
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http://www.chron.com/disp/story.mpl/business/7430875.html
WASHINGTON — The government is preparing to sell $500 million worth of crude oil the U.S. has stockpiled for emergencies because of problems with the integrity of one of the underground caverns where it is stored.
Energy Secretary Steven Chu defended the plan Wednesday amid concerns the sale of crude from the Strategic Petroleum Reserve would leave the U.S. more vulnerable to disruptions in the supply of Mideast oil.
Chu said it was better for the government to cash in on the crude rather than risk it seeping out of a salt dome cavern in southeast Louisiana or chance an overflow of oil as it is moved to other brimming storage sites.
The U.S. already is draining the cavern and putting some of the oil in other storage locations, Chu told the Senate Energy and Natural Resources Committee.
"But we're concerned with overfilling those storage locations, and we don't want to lose this crude, so we are trying to manage that," he said.
The cavern in question - Bayou Choctaw Cavern 20 near Baton Rouge - now sits within 60 feet from the edge of a salt dome, defying federal requirements for a salt barrier of at least 300 feet to contain stored material. Seismic research in 2009 detected the problem and showed that the cavern had leached toward the edge of the salt dome.
Although Cavern 20 initially had a usable capacity of 7.5 million barrels, government geologists say it now can safely hold only 3.2 million barrels.
Spending on replacement
Congress has authorized the Energy Department to spend $33.5 million for a replacement, and officials are buying a privately owned cavern - also in the Bayou Choctaw salt dome - with a 10-million-barrel capacity.
The government's plan to sell the oil from the strategic reserve was part of President Barack Obama's budget plan for the 2012 fiscal year that begins in October. Obama delivered that budget blueprint to Congress on Monday, and the Senate energy panel was studying it Wednesday.
The Strategic Petroleum Reserve, established in the 1970s to protect the U.S. economy from price spikes caused by oil supply disruptions, is meant to fulfill federal requirements that the U.S. government and private sector stockpile about 90 days' worth of oil.
The reserve contains 726.5 million barrels of crude - just shy of its 727 million-barrel capacity - stored in 62 underground salt caverns at four sites in Texas and Louisiana. That represents a 75-day supply, based on government estimates that the U.S. imported 9.7 million barrels of oil daily in 2009.
Chu said the U.S. will put one day's supply on the market, and that the reduction will be temporary until new storage is available.
Read more: http://www.chron.com/disp/story.mpl/business/7430875.html
**So, where does the rest of the 30 million barrels come from, JDN?
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GM - typical; a proliferation of posts aimed at me, yet none address the issue. When you don't have facts.... :-)
I don't know or care where the 30 million barrels come from.
Or Deepwater Horizon.
Nor am I particularly concerned with the Jones Act although I find it interesting.
http://www.gulfcoastmaritime.com/maritime-legal-news/deepwater-horizon-disaster-provokes-continued-jones-act-debate/912/
I merely pointed out that the information Crafty posted, "By the way, an additional detail, not widely known: The salt caverns in which the oil is stored, deteriorate somewhat every time oil is taken out and then replaced." was incorrect information. In fact, the oil needed to be taken out. Whether it is transferred to another facility, sold on the open market, or given away has nothing
to do with further damaging these particular salt caverns. As a matter of fact the caverns are in disrepair and the oil needs to be taken out.
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http://www.usembassy.it/pdf/other/RL33341.pdf
The program is managed by the Department of Energy (DOE). Physically, the
SPR comprises five underground storage facilities, hollowed out from naturally
occurring salt domes, located in Texas and Louisiana. The caverns were finished by
injecting water and removing the brine. Similarly, oil is removed by displacing it
with water injection. For this reason, crude stored in the SPR remains undisturbed,
except in the event of a sale or exchange. Multiple injections of water, over time, will
compromise the structural integrity of the caverns.2 By 2005, the capacity of the SPR
reached 727 million barrels.
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Thank you. That post at least addresses the issue.
However, this particular facility already had been noted to be at it's end of it's operational life. Obama's decision, wrong or right, to take this oil out and put it on
the market will have no impact on this already spent cavern. The oil needed to be removed regardless.
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And strangely, it was against our national security interest to release the oil in March, April and May, but necessary now because of whatever the latest reason is that people with no integrity put out.
Gasoline is like milk, needs freshness dating breaks down over time. This I assume is unrefined oil. Needs to go to the refinery which takes time and takes up refining capacity which we also haven't added to in a very long time.
Right or wrong with this decision, it is a band-aid on a central and major government caused problem, crucial to our security both economically and strategically. We are not low on energy; we just keep tying ourselves up in laws and red tape.
One good part is I understand this was coordinated with other countries releasing reserves to make an impact. But then when they re-fill the reserves they are taking the exact same of oil off the market at a slightly different time - or leaving the free world without strategic reserves.
It should have been combined with a comprehensive action to drill more, refine more, sell more and yes, consume more oil. Our national policy is still the opposite. Stay home. Destroy tourism and fun. Take government transit. We will tell you where you can go and we will control your thermostats as well. Government knows best.
An expansive plan to flood the market for a hundred years with natural gas and make it widely available for transportation uses would take the pressure off of oil as well.
The last comprehensive energy plan died with the personal attacks on Dick Cheney's committee. Imagine that, he turned to people who know how to produce energy to get advice on ... how to produce more energy. And people like Colin Powell, Chistie Todd Whitman, Mitch Daniels, etc. But we didn't implement the plan. Now we are here facing constant scarcity, unreliable supplies and reliant way too much - still - on enemies of the United States for crucial resources. http://wtrg.com/EnergyReport/National-Energy-Policy.pdf We could be 10 years into this plan right now and more than 10 into into ANWR by now. The Alaskan pipeline flow is so slow right now the continuing use of the line is now in question.
Meanwhile I need a G*d D*mned government license to go sailing.
Decline was a choice, and we made it. This does NOTHING to change that.
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Thank you. That post at least addresses the issue.
However, this particular facility already had been noted to be at it's end of it's operational life. Obama's decision, wrong or right, to take this oil out and put it on
the market will have no impact on this already spent cavern. The oil needed to be removed regardless.
http://www.statesman.com/news/nation/u-s-to-sell-500-million-in-oil-1259883.html?cxtype=rss_news
The cavern in question — Bayou Choctaw Cavern 20 near Baton Rouge, La. — is inside the hollowed-out salt dome, but the oil is within 60 feet of the edge of the dome, defying federal requirements for a 300-foot barrier.
Although Cavern 20 initially had a usable capacity of 7.5 million barrels, government geologists say it can now safely hold only 3.2 million barrels of oil to limit the risk of breaching the side of the salt dome.
To make up for the now-unusable capacity in Cavern 20, federal officials have been preparing to purchase a privately owned existing cavern — with a 10-million-barrel capacity.
The government's plan to sell oil from the strategic reserve was included in President Barack Obama's budget plan for the 2012 fiscal year that begins in October. Obama delivered that budget blueprint to Congress on Monday, and the Senate energy panel was studying it on Wednesday.
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The Strategic Petroleum Reserve, established in the 1970s to protect the U.S. economy from price spikes caused by oil supply disruptions, is meant to fulfill federal requirements that the U.S. government and private sector stockpile about 90 days' worth of oil.
The reserve contains 726.5 million barrels of crude - just shy of its 727 million-barrel capacity - stored in 62 underground salt caverns at four sites in Texas and Louisiana. That represents a 75-day supply, based on government estimates that the U.S. imported 9.7 million barrels of oil daily in 2009.
Chu said the U.S. will put one day's supply on the market, and that the reduction will be temporary until new storage is available.
Lots of questions
Before Chu's explanation, some senators questioned the plan to sell oil while unrest in the Middle East underscores the risks of U.S. reliance on foreign oil. They also wondered if the sale was really aimed at raising money for the cash-starved federal government.
Sen. Jeff Bingaman, D-N.M., the energy committee chairman, noted that the administration's budget proposal contains "very little in the way of justification."
The top Republican on the committee, Sen. Lisa Murkowski of Alaska, questioned the wisdom of a non-emergency sale. She said the U.S. is more than 50 percent dependent on foreign oil sources, and that permitting for domestic production has been slowed by new rules in response to last year's Gulf of Mexico oil spill.
"Why is it appropriate at this particular juncture for the United States to reduce our stocks of emergency crude?" Murkowski asked.
She also asked Chu for more information about long-term integrity issues with other underground salt caverns that hold the emergency oil stockpile.
Other caverns abandoned
The government previously has abandoned at least two other storage caverns, said Bruce Beaubouef, the author of a book on the Strategic Petroleum Reserve. Both initially were chosen during the government's mid-1970s scramble to stash oil away - mostly because they were readily available and not necessarily because they were the best long-term sites.
The government used previously created salt caverns along the Gulf Coast to store the first 250 million barrels of oil in the reserve.
Later, it began using a process called "solution mining" to carve additional caverns out of underground salt domes. The process involves injecting water deep underground to dissolve salt and create the pockets, some of which are as big as skyscrapers.
The same process that is used to create the caverns can make them bigger over time as water is injected to force oil from the domes, Beaubouef said.
"That essentially leaches out the cavern further," he said. "That's planned for. It's in the design. But every time there's a drawdown order, the cavern gets bigger."
It appears that may have happened at Bayou Choctaw Cavern 20, which the government tapped for oil after Hurricane Katrina in 2005 and Hurricane Gustav in 2008. Seismic analysis a year later showed the cavern had leached to within 60 feet of the edge of the salt dome.
jennifer.dlouhy@chron.com
**So, we must sell all the oil in the Bayou Choctaw Cavern 20 (7.5 million barrels) because it's structural integrity was damaged by previous drawdowns, and in addition, we are going to damage other caverns to sell another 22.5 million gallons of oil. Sounds like something a community organizer would come up with.
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"**So, we must sell all the oil in the Bayou Choctaw Cavern 20 (7.5 million barrels) because it's structural integrity was damaged by previous drawdowns, and in addition, we are going to damage other caverns to sell another 22.5 million gallons of oil. Sounds like something a community organizer would come up with."
That 'bout gets it-- sorry JDN, but it looks like I remembered correctly :-)
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"**So, we must sell all the oil in the Bayou Choctaw Cavern 20 (7.5 million barrels) because it's structural integrity was damaged by previous drawdowns, and in addition, we are going to damage other caverns to sell another 22.5 million gallons of oil. Sounds like something a community organizer would come up with."
That 'bout gets it-- sorry JDN, but it looks like I remembered correctly :-)
The "community organizer" didn't nor is he going to "damage" the Bayou Choctaw; Bush did. Maybe for good reason; maybe not. That is not my point.
Now, present day, Obama has no choice. You implication that Obama's decision will deteriorate the Choctaw cavern is wrong. Rather, the structural integrity is already damaged, therefore his decision to sell, or transfer or give away this oil is necessary due to the structure already being damaged. That about sums it up.
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"**So, we must sell all the oil in the Bayou Choctaw Cavern 20 (7.5 million barrels) because it's structural integrity was damaged by previous drawdowns, and in addition, we are going to damage other caverns to sell another 22.5 million gallons of oil. Sounds like something a community organizer would come up with."
That 'bout gets it-- sorry JDN, but it looks like I remembered correctly :-)
The "community organizer" didn't nor is he going to "damage" the Bayou Choctaw; Bush did. Maybe for good reason; maybe not. That is not my point.
Now, present day, Obama has no choice. You implication that Obama's decision will deteriorate the Choctaw cavern is wrong. Rather, the structural integrity is already damaged, therefore his decision to sell, or transfer or give away this oil is necessary due to the structure already being damaged. That about sums it up.
Well, according to the articles "Cavern 20 initially had a usable capacity of 7.5 million barrels, government geologists say it can now safely hold only 3.2 million barrels of oil to limit the risk of breaching the side of the salt dome.". Now, I don't have a problem with selling all 7.5 million barrels just to be safe. My question is, where does the rest of the oil he's selling come from? Won't that damage those salt caverns? Does that mean we'll have to sell that oil in the future and buy/mine more salt caverns?
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http://www.cbsnews.com/8301-503544_162-20073794-503544.html
August 16, 2005:
"I know that everybody's getting killed by these higher gas prices, but we need to hold on to that reserve," he said. "If the Saudi Arabian monarchy was overthrown and our imports were cut off, you'd be looking at $8- to $9-a-gallon gasoline." (From an Aug. 17, 2005 article in the St. Louis Post-Dispatch)
August 31, 2005:
"The reserve should only be used in the event of an emergency, and that we shouldn't be tapping the reserve to provide a small, short-term decrease in gas prices."
July 7, 2008:
"You have a situation let's say where there was a major oil facility in Saudi Arabia that was destroyed as a consequence of terrorist acts and you suddenly had huge amounts of oil taken off...taken out of the world market. We wouldn't just be seeing $4/gallon oil [sic], we could see a situation where entire sectors of country had no oil to function at all and that's what the strategic oil reserve has to be for."
August 4, 2008:
"We should sell 70 million barrels of oil from our Strategic Petroleum Reserve for less expensive crude, which in the past has lowered gas prices within two weeks."
Later in the day, on his campaign plane, on August 4, 2008:
"I historically have been very hesitant about that but the idea of a swap actually I think has merit in terms of just short-term effect on prices. I offer no sort of suggestion that in any way that it's going to make a long term impact on the fact that demand worldwide is going up and supply is flat lined at best. And we're going to have to make some enormous adjustments, so the question is, if we're replacing some light crude coming out with some heavier crude going in, is that going to have some effect on short-term supplies to provide people some relief? I think that that's very different from saying we're going to raid the highway trust fund and there's no prospects of immediate relief and if there was then at most it's 30 cents a day."
March 11, 2011:
"So we're going to try to do everything we can not only to stabilize the market, as I said, to the extent that we see any efforts to take advantage of these price spikes through price gouging, we're going to go after that. If we see significant disruptions or, you know, shifts in the market that are -- are so disconcerting to people that we think a Strategic Petroleum Reserve release might be appropriate, then we'll take that step. And we're going to monitor very closely."
Read more: http://www.cbsnews.com/8301-503544_162-20073794-503544.html
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How about we switch to an American made natural gas strategic reserve. Legalize safe clean production, produce it in high quantities, make it affordable and hook it up to every home and business with a pipeline and a meter.
http://www.naturalgas.org/environment/naturalgas.asp
"The combustion of natural gas emits almost 30 percent less carbon dioxide than oil, and just under 45 percent less carbon dioxide than coal."
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By DEVLIN BARRETT and JACOB GERSHMAN
A proposal by state regulators to allow hydraulic fracturing drilling for gas will likely fuel a new burst of lobbying on the polarizing issue.
The New York Department of Environmental Conservation said a draft report to be released Friday will recommend barring the process called fracking in areas that provide drinking water.
The DEC recommendations will ultimately land on the desk of Gov. Andrew Cuomo, a Democrat who has tried to carefully navigate the issue. The dispute often splits rural communities in which fracking is alternately seen as an economic windfall or an environmental hazard. Public opinion on drilling also tends to fall along geographic lines, with much of the opposition centered around New York City and downstate, with the biggest supporters tending to be upstate.
The document is seen as a key starting point for months of debate over fracking in the state. New Jersey's Legislature decided to ban the practice.
The Manhattan Institute, a conservative think tank, has estimated that ending New York's moratorium on fracking would mean a $11.4 billion boost in economic output, though that calculation did not assume the limitations in the new proposal.
New York City officials had sought to protect their expansive watershed, and were pleased by the proposal announced Thursday in Albany.
Mayor Michael Bloomberg called the proposal "the right decision'' because it would ban fracking in major watersheds and create a system of regulations to "allow drilling in a rigorously protective and environmentally responsible way....These new recommendations appear to adopt the restrictions we sought.''
Assembly Speaker Sheldon Silver said in a statement that he was happy aquifers and drinking water supplies would be protected.
Roger Downs, legislative director for the Atlantic chapter of the Sierra Club, said he had not expected a complete statewide ban on the practice, but said the DEC's proposal is still weak on allowing for future analysis and data.
The DEC would bar hydrofracking in the aquifers for New York City and the upstate Syracuse area, and would create a series of restrictions aimed at keeping the practice—which involves pumping a mixture of water, sand and chemicals deep underground to free reserves of natural gas—away from drinking water.
Under the proposal, no permits would be issued for sites within 500 feet of a private water well or domestic-use spring. Nor would permits be issued for a site within 2,000 feet of a public drinking water supply well or reservoir until three years or more of further data collection. And no permits would be issued for well sites within a 100-year floodplain.
The governor may not necessarily have the last word on the issue. The Legislature, which previously passed its own moratorium on drilling, could decide to revisit fracking. And the state attorney general, Eric Schneiderman, is also active on the issue, having filed a lawsuit accusing federal agencies of not conducting necessary study of the issue before allowing drilling in the Delaware River basin.
While the proposal announced Thursday echoes many of the points Mr. Schneiderman made, the entire issue of fracking has elicited significant differences in federal and state approaches to the burgeoning industry.
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http://finance.yahoo.com/news/Oil-prices-back-to-before-the-cnnm-2461149112.html?x=0&.v=3
Oil prices: back to before the strategic reserves were tapped
"Community organizer" brilliance strikes again!
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"Oil prices: back to before the strategic reserves were tapped"
That policy was so flawed most serious analysts didn't bother to criticize it. First you have the Obama/far left admitting that supplies matter in prices and that prices matter in preventing growth and hiring, in eroding our standard of living and in his private non-re-election polling. Then they choose the only source we know of that has a strictly finite amount available.
He could have coupled that with openings in ANWR, offshore etc and hit the market with the news that ongoing supplies are coming for as far into the future as the eye can see.
I wonder how much oil would come from ANWR, which they trivialized when they stopped it - wouldn't be enough to make an impact, as compared to the total that can come once emptying our reserve.
What will be the impact on supplies and prices later when we have to buy oil and take it off the market to build back a strategic reserve?
Not really chess players, they couldn't think one move ahead.
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"Oil prices: back to before the strategic reserves were tapped"
That policy was so flawed most serious analysts didn't bother to criticize it. First you have the Obama/far left admitting that supplies matter in prices and that prices matter in preventing growth and hiring, in eroding our standard of living and in his private non-re-election polling. Then they choose the only source we know of that has a strictly finite amount available.
He could have coupled that with openings in ANWR, offshore etc and hit the market with the news that ongoing supplies are coming for as far into the future as the eye can see.
I wonder how much oil would come from ANWR, which they trivialized when they stopped it - wouldn't be enough to make an impact, as compared to the total that can come once emptying our reserve.
What will be the impact on supplies and prices later when we have to buy oil and take it off the market to build back a strategic reserve?
Not really chess players, they couldn't think one move ahead.
Don't forget the degradation of the storage caverns that had water pumped in to remove the oil.
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No idea as to the validity of this source or its conclusions, but I have noted various times previously about how low the margin requirements are for oil futures , , ,
=======================
The Contango Game: How Koch Industries Manipulates The Oil Market For Profit
By Lee Fang on Apr 13, 2011 at 11:55 am
In recent weeks, gas prices around the country have surged to levels unseen since the 2008 oil spike. However, market fundamentals are not driving the nearly $4.00/gallon gas prices. In fact, under the Obama administration, oil production is at record highs and there is adequate global supply of crude. As Commodity Futures Trading Commission (CFTC) commissioner Bart Chilton has explained, rampant oil speculation, which is at its highest level on record right now, is to blame for current prices.
Currently, the public knows very little about the oil speculation industry because a conservative majority on the CFTC has refused to implement a mandate from the Dodd-Frank Wall Street reform bill to curb abuses. Meanwhile, Republicans are pushing steep cuts to the CFTC, hampering any new rules on oil speculation that may be released later this summer. Fortunately, both the Securities and Exchange Commission and the CFTC have so far survived the latest round of budget cuts.
While much of the attention on oil speculators has rested on the backs of investors and commodity traders, the petrochemical conglomerate Koch Industries occupies a unique role in manipulating the oil market. Koch has little business in the extraction process. Instead, Koch focuses on shipping crude oil, refining it, distributing it to retailers — then speculating on the future price. With control of every part of the market, Koch is able to bet on future prices with superior information. As Yasha Levine notes, Koch along with Enron pioneered a number of complex financial products to leverage its privileged position in the energy industry.
In 2008, Koch called attention to itself for “contango” oil market manipulation. A commodity market is said to be in contango when future prices are expected to rise, that is, when demand is expected to outstrip supply. Big banks and companies like Koch employ a contango strategy by buying up oil and storing it in massive containers both on land and offshore to lock in the oil for sale later at a set price. In December of 2008, Koch leased “four supertankers to hold oil in the U.S. Gulf Coast to take advantage of rising prices in the months ahead.” Writing about Koch’s contango efforts to artificially drive down supply, Fortune magazine writer Jon Birger noted they could be raising “gasoline prices by anywhere from 20 to 40 cents a gallon” at the time. Speaking with the Business Times, Koch executive David Chang even boasted that falling crude prices in 2008 provided an opportunity remove oil from the market for future delivery:
CHANG: The drop in crude oil prices from more than US$145 per barrel in July 2008 to less than US$35 per barrel in December 2008 has presented opportunities for companies such as ours. In the physical business, purchases of crude oil from producers and storing offshore in tankers allow us to benefit from the contango market where crude prices are higher for future delivery than for prompt delivery.
A recent presentation from Koch Supply & Trading, the Koch unit devoted to selling financial products, confirms that Koch has taken advantage of a lax regulatory environment to aggressively trade on future oil prices. “The return of speculators to Oil, the ‘macro trade’ is alive and well,” reads slide 36:
Koch Supply & Trading Risk Management
The slideshow, given to an industry association for oil speculators, describes Koch as the “world’s top five crude oil traders and actively trades about 50 types of crude oil around the world.” Notably, Koch “has trading operations in London, Geneva, Singapore, Houston, New York, Wichita, Rotterdam, and Mumbai.”
As a recent Center for Public Integrity report uncovered, Koch lobbied aggressively against Obama’s financial reform bill, particularly on provisions related to transparency in the energy trading market. Is Koch again buying up supply in expectation of higher crude prices during the summer or beyond — as many analysts have predicted? No one knows, especially when the energy speculation and trading industry currently operates with virtually no regulation.
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http://www.powerlineblog.com/archives/2011/04/028825.php
Posted on April 15, 2011 by John Hinderaker
Contango Confusion
The Think Progress web site is a Soros-funded mouthpiece for the Obama administration. Someone at Think Progress or its parent, the Center for American Progress, has instructed cub reporter Lee Fang to devote full time to attacking Charles and David Koch and their company, Koch Industries. (It would be interesting to know who gave that instruction, and why.) We have deconstructed several of Mr. Fang’s attacks, all of which have been juvenile. But his latest effort is perhaps his most pitiful yet.
In “The Contango Game,” Fang tries to show that Koch Industries “manipulates the oil market for profit.” Unfortunately, young Mr. Fang has neither the business experience nor the intelligence to understand the issues about which he writes. The result is that nearly every sentence is a howler. Among other things, while a contango market is the main subject of Fang’s post, he doesn’t know what the phrase means.
Fang begins with the claim that oil prices are high these days because of speculation. Whether it is even possible for “speculators”–some call them investors–to have a material impact on the price of oil over time is dubious. While partisans like to blame speculators for rising oil prices–never, however, for falling prices–objective studies, like this one by the Commodity Futures Trading Commission in 2008, have failed to document any such influence.
Moreover, if you don’t like commodity futures investors–sorry, speculators–you are barking up the wrong tree by attacking Koch Industries. Koch buys and sells physical oil; it transports oil; it refines oil. It does some unhedged trading too, but in that field it is a minor player compared to, say, Goldman Sachs. If Think Progress wants to attack petroleum speculators, Goldman Sachs should be in the dock–except that Goldman Sachs is a top contributor to Barack Obama and the Democratic Party.
Our cub reporter continues:
While much of the attention on oil speculators has rested on the backs of investors and commodity traders, the petrochemical conglomerate Koch Industries occupies a unique role in manipulating the oil market.
This is just ridiculous. In the world of petroleum, where Exxon Mobil is number fourteen on the worldwide list, Koch is hardly in a position to “manipulate” anything.
Koch has little business in the extraction process. Instead, Koch focuses on shipping crude oil, refining it, distributing it to retailers — then speculating on the future price. With control of every part of the market, Koch is able to bet on future prices with superior information.
Huh? Koch sells oil to retailers, and “then” speculates on the future price? Isn’t that a little late? One wonders whether these people even read what they write before publishing it.
And what is this about “control of every part of the market”? Fang just made that up. The oil business is highly competitive, and Koch Industries is, in international terms, a small player. Let’s take refining: the U.S. Energy Information Administration publishes data on America’s biggest refineries. Koch owns three of the 141 largest refineries in the United States; its biggest weighs in at number twelve. So how, exactly, does Koch “control every part of the market”?
Young Mr. Fang continues:
In 2008, Koch called attention to itself for “contango” oil market manipulation. A commodity market is said to be in contango when future prices are expected to rise, that is, when demand is expected to outstrip supply.
This is incorrect. “Contango” is not “market manipulation.” On the contrary, it is the natural state of most markets. It simply means that at a given time, the price of a forward or futures contract is trading above the present spot price. This is what you would expect, given the time value of money. Occasionally, for various reasons, this usual condition may not hold; then we have what is called “backwardation.” A contango market has nothing to do with any expectation; rather, if the futures price is higher than the spot price, as is normally the case, it is a contango market.
It is quite remarkable, really, that anyone would try to write a blog post about a contango market without even knowing what the term means. Mr. Fang continues:
Big banks and companies like Koch employ a contango strategy by buying up oil and storing it in massive containers both on land and offshore to lock in the oil for sale later at a set price. In December of 2008, Koch leased “four supertankers to hold oil in the U.S. Gulf Coast to take advantage of rising prices in the months ahead.”
An interesting claim. Koch certainly does buy oil and store it; it is in the oil business. However, I would be curious to know what “big banks” “buy[] up oil and stor[e] it in massive containers both on land and offshore.” In any event, if Koch or any other company has sold oil on a futures contract, it has to produce or buy the oil and store it until the contract comes due. This, apparently, seems sinister to young Mr. Fang. I am guessing his experience in the business world is not extensive.
More:
Writing about Koch’s contango efforts to artificially drive down supply, Fortune magazine writer Jon Birger noted they could be raising “gasoline prices by anywhere from 20 to 40 cents a gallon” at the time.
Pretty much every word of this sentence is false. Contango is the most common market condition, not an “effort[] to artificially drive down supply.” And Fang simply misquotes the cited Fortune article, which claims that “a 200,000 barrel-a-day decrease in supply could raise gasoline prices by anywhere from 20 to 40 cents a gallon.” It did not attribute any such decrease in supply to Koch Industries or any other company.
Mr. Fang continues:
Speaking with the Business Times, Koch executive David Chang even boasted that falling crude prices in 2008 provided an opportunity remove oil from the market for future delivery:
CHANG: The drop in crude oil prices from more than US$145 per barrel in July 2008 to less than US$35 per barrel in December 2008 has presented opportunities for companies such as ours. In the physical business, purchases of crude oil from producers and storing offshore in tankers allow us to benefit from the contango market where crude prices are higher for future delivery than for prompt delivery.
This is a good opportunity to clear away the mists of confusion and explain what was going on in late 2008. Due to the worldwide recession, the demand for crude oil plummeted. Refineries didn’t want any more oil; they couldn’t sell all that they were producing, and their storage facilities were full. At the same time, oil production continued; you can’t turn oil wells on and off like a light switch. Thus, the spot market plunged to a fraction of what it had been months earlier. There was almost no demand for immediate delivery of oil.
At the same time, refineries knew that they would be selling their inventories over time, and demand was expected to pick up. Thus, refineries wanted to lock in future deliveries of oil at reasonable prices. This led to an unusually steep contango curve; that is, the price of oil to be delivered, say, six months in the future was considerably higher than the price of oil to be delivered immediately. Another way of putting this is that there was a huge demand for storage of crude oil. Anyone who had the financial ability to buy large quantities of crude without quick resale, and had access to storage, was able to make good money. That is exactly what Koch Industries and a number of other companies did.
This is not “market manipulation,” it is market satisfaction. Koch sold oil when customers wanted it, at a price dictated by the market. The problem with web sites like Think Progress and smear artists like Lee Fang is that they have zero understanding of economics and zero understanding of business. Thus, pretty much everything they write on these topics is wrong. They cater to an audience of the ignorant.
Let’s wrap up. Poor Mr. Fang concludes with this howler:
A recent presentation from Koch Supply & Trading, the Koch unit devoted to selling financial products, confirms that Koch has taken advantage of a lax regulatory environment to aggressively trade on future oil prices. “The return of speculators to Oil, the ‘macro trade’ is alive and well,” reads slide 36:
The Power Point presentation embedded in Fang’s post was given by a Koch Supply & Trading employee at a conference in Geneva. Its intended audience was prospective clients for Koch’s risk management services. Companies like airlines, for example, need to assure themselves of a future supply of petroleum products, and need to manage the risks associated with price fluctuations. This is a service that Koch Supply & Trading provides. If you actually look at the Power Point presentation, it is an impressive product. It explains Koch’s expertise in this area. The reference to “speculators” had nothing at all to do with Koch Industries, but rather was one line in a discussion of prospects for future price movements.
The basic problem with a site like Think Progress is that its “reporters,” ill-informed, uneducated, inexperienced amateurs like Lee Fang, try to write about subjects of which they have no understanding. Worse yet, they slander the very people who do understand those topics–the people who produce products and make our economy go.
There is another level of irony here. Koch Industries is a classic example of an American company that doesn’t just push paper, but actually makes products. Its business is production, not “speculation.” Think Progress, on the other hand, is funded by one of the world’s most successful speculators: George Soros. Soros has made billions by manipulating markets, without ever producing anything. He is the definitive speculator and market manipulator (in particular, currency markets) of the 20th century. If Soros bothered to read what his minion Lee Fang wrote, he no doubt would burst out in laughter at Fang’s ignorance. But that, apparently, doesn’t bother Soros. He is happy to promote ignorance as long as it advances his own selfish political interests.
UPDATE: A reader writes:
Nice job on the Koch piece. I’m in the business, and you explained it all very well. The Koch presentation about speculators (the “macro” people) is about the flow of money into specific commodity markets. The flows are large enough to make the markets move against the fundamentals in the short run.
In other markets, for example soft commodities (ags), contango is referred to as “carry,” the source the phrase “the carry trade,” which is mainly used in reference to interest rates and FX. Everyone has the opportunity to buy the nearby and sell deferred. The difference between the two needs to cover the cost of storing and financing the inventory, which in the Koch case includes the daily cost of chartering a ship to use as storage, which is in the tens of thousands or hundreds of thousands of dollars per day. If contango/carry didn’t exist, no one would have an incentive to hold inventory.
FURTHER UPDATE: “Think Progress” is rapidly becoming the punching bag of the internet. For another fun devastation of a remarkably stupid Think Progress post on Koch, Governor Walker and Justice Prosser, see Professor Bill Jacobson. These people are really making it too easy; George Soros may want to demand his money back.
MORE: Another highly knowledgeable reader writes:
Your comments on contango are exactly right. Koch and the other market participants REACTED to extraordinary contango pricing in the market; they did not just wake up one day and decide to inventory oil on spec to create the contango conditions. The contango trade is possible because spot prices DROPPED….compared to longer term pricing in the first instance. The image implied that Koch somehow “artificially” removes supply because they inventory oil is itself ludicrous. They don’t “remove supply”— they buy oil for immediate delivery at spot prices….the market price today…that anyone can get and that clears current supply. And in the future, to realize on the trade, wouldn’t they on this logic have to dump their inventory then “artificially” creating “excess” supply…and driving prices down? If the claim is that Koch and others are “artificially” reducing current supplies which tends to raise spot prices, it would thereby cause spot and future prices to converge and eliminate the point of the trade!
The idea that Koch “occupies a unique role in manipulating the oil market”…and has “control of every part of the market…with superior information”….with NO, zero, nada oil production of its own is laughable on its face, as you note. This is an arbitrage trade; by definition not “speculative” if you’re long the crude and short the forward. Your price spread is locked in risk-free…it’s only “speculative” if you’re missing one leg of the trade. Koch and — horrors! — some banks or financial institutions who also did the same trade actually went out and leased ships and storage facilities? Well, so what? In fact, the very existence of the leases for storage of physical product is evidence that the forwards are not speculation just as the existence of forwards means that the storage of physical product is not speculative.
The utter stupidity of this “journalism” is summed up in the breathless conclusion. “Is Koch again buying up supply in expectation of higher crude prices during the summer or beyond – as many analysts have predicted?”…well, duh!…Koch itself, as the article notes, is NOT a producer of crude oil…they are a refiner and buyer only. So, OF COURSE they are “buying up supply” if they believe — quite reasonably, as the article itself suggests — that prices in the future will be higher! What else would they or any rational user of crude oil do?
Obviously this moron doesn’t know the difference between hedging and speculation. Indeed, the very source cited concludes that expected future higher prices, quoting the U.S. government’s Energy Information agency, are due to….”continuing strength in worldwide liquid fuels consumption.”….in other words….market fundamentals!….not “speculation.”
The article is absurd….nonsense on stilts….hysterical propaganda obviously intended as prolefeed…nothing but a collection of question begging assertions, non sequiturs and shamefully misrepresented citations to frighten and outrage the ignorant who, like the author, evidently have no concept whatsoever how any of these businesses and markets actually operate.
That pretty well sums up Think Progress.
OKAY, ONE MORE, from reader Craig Pirrong:
I wrote the book on manipulation (The Law, Economics, and Public Policy of Market Power Manipulation, Kluwer, 1996). I’ve also published 10 scholarly articles in economics journals and law reviews on the subject. My next book (Structural Models of Commodity Price Dynamics, Cambridge UP, forthcoming) is all about the determinants of contango, backwardation, storage, etc. Based on 25 years of scholarly research and market experience, I can say that Fang the Farcical knows not the first thing about either manipulation or commodities pricing. You would think that Soros could have found a junior assistant trader to teach Fang the basics. But then there wouldn’t have been a story, would there?
Lee Fang, RIP.
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If we wanted to squeeze the profit per gallon and power and influence out of oil companies, we would expand production, not curtail it. Companies like Exxon-Mobil and Koch are in a business that includes owning oil at the various points of the production and transportation process. When prices are forced up with excessive regulations, it forces out competition, forces up prices and gives a windfall to big oil companies. I wonder if that is what the Obama policies intend.
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GM:
Thanks for that. I am using it for return fire with the person who sent it to me :-D
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GM:
Thanks for that. I am using it for return fire with the person who sent it to me :-D
Good. :-D
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http://dailycaller.com/2011/07/08/house-gop-set-to-repeal-incandescent-bulb-ban/
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http://dailycaller.com/2011/07/08/house-gop-set-to-repeal-incandescent-bulb-ban/
But, but mercury poisioning is good for the environment or something.....
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http://dailycaller.com/2011/07/08/house-gop-set-to-repeal-incandescent-bulb-ban/
But, but mercury poisioning is good for the environment or something.....
http://epa.gov/cfl/cflcleanup-detailed.html
What to Do if a Compact Fluorescent Light (CFL) Bulb or Fluorescent Tube Light Bulb Breaks in Your Home: Detailed Recommendations
Other Types of Light Bulbs
Follow the recommendations on this page if you've broken another type of mercury-containing light bulb, such as:
Fluorescent bulbs:
•Linear, U-tube and circline fluorescent tubes
•Bug zappers
•Tanning bulbs
•Black lights
•Germicidal bulbs
•High output bulbs, and
•Cold-cathode fluorescent bulbs.
High intensity discharge bulbs:
•Metal halide
•Ceramic metal halide
•High pressure sodium, and mercury vapor.
Mercury short-arc bulbs; and
Neon bulbs.
Download and print a three-page
PDF version of this overview and the
detailed recommendations (91K, about PDF) |
en español (30K, about PDF)
Related Information
•Why is it important to take these steps? Learn more about CFLs and mercury.
•Find out how to recycle and dispose of a CFL after it burns out
•Color brochure: Download and print a two-page brochure on how to safely clean up and recycle compact fluorescent bulbs (869K, about PDF) | en español (876K, about PDF)
•Main CFL page
Disclaimer
This document contains information designed to be useful to the general public. This document:
•does not impose legally binding requirements, nor does it confer legal rights, impose legal obligations, or implement any statutory or regulatory provisions;
•does not change or substitute for any statutory or regulatory provisions;
•presents technical information based on EPA’s current understanding of the potential hazards posed by breakage of mercury-containing fluorescent lamps (light bulbs) in a typical household setting;
•is a living document and may be revised periodically without public notice.
EPA welcomes comments on this document at any time and will consider those comments in any future revisions of this document.
View the most important steps to reduce exposure to mercury vapor from a broken bulb
Note that these steps are precautions and reflect best practices for cleaning up a broken CFL. If you are unable to follow them fully, don't be alarmed. CFLs contain a very small amount of mercury -- less than 1/100th of the amount in a mercury thermometer. However, if you are concerned about the risk to your health from a potential exposure to mercury, consult your physician.
Recommended steps:
•Before cleanup
•Cleanup steps for:
◦Hard surfaces
◦Carpeting or rugs
•Future cleaning of carpeting or rugs: air out the room during and after vacuuming
•Actions you can take to prevent broken compact fluorescent light bulbs
Before Cleanup
1.Have people and pets leave the room, and avoid the breakage area on the way out.
2.Open a window or door to the outdoors and leave the room for 5-10 minutes.
3.Shut off the central forced-air heating/air conditioning (H&AC) system, if you have one.
4.Collect materials you will need to clean up the broken bulb:
◦Stiff paper or cardboard
◦Sticky tape (e.g., duct tape)
◦Damp paper towels or disposable wet wipes (for hard surfaces)
◦Glass jar with a metal lid (such as a canning jar) or a sealable plastic bag(s)
Cleanup Steps for Hard Surfaces
1.Carefully scoop up glass fragments and powder using stiff paper or cardboard and place debris and paper/cardboard in a glass jar with a metal lid. If a glass jar is not available, use a sealable plastic bag. (NOTE: Since a plastic bag will not prevent the mercury vapor from escaping, remove the plastic bag(s) from the home after cleanup.)
2.Use sticky tape, such as duct tape, to pick up any remaining small glass fragments and powder. Place the used tape in the glass jar or plastic bag.
3.Wipe the area clean with damp paper towels or disposable wet wipes. Place the towels in the glass jar or plastic bag.
4.Vacuuming of hard surfaces during cleanup is not recommended unless broken glass remains after all other cleanup steps have been taken. [NOTE: It is possible that vacuuming could spread mercury-containing powder or mercury vapor, although available information on this problem is limited.] If vacuuming is needed to ensure removal of all broken glass, keep the following tips in mind:
◦Keep a window or door to the outdoors open;
◦Vacuum the area where the bulb was broken using the vacuum hose, if available; and
◦Remove the vacuum bag (or empty and wipe the canister) and seal the bag/vacuum debris, and any materials used to clean the vacuum, in a plastic bag.
5.Promptly place all bulb debris and cleanup materials, including vacuum cleaner bags, outdoors in a trash container or protected area until materials can be disposed of properly.
◦Check with your local or state government about disposal requirements in your area. Some states and communities require fluorescent bulbs (broken or unbroken) be taken to a local recycling center.
6.Wash your hands with soap and water after disposing of the jars or plastic bags containing bulb debris and cleanup materials.
7.Continue to air out the room where the bulb was broken and leave the H&AC system shut off, as practical, for several hours.
Cleanup Steps for Carpeting or Rugs
1.Carefully scoop up glass fragments and powder using stiff paper or cardboard and place debris and paper/cardboard in a glass jar with a metal lid. If a glass jar is not available, use a sealable plastic bag. (NOTE: Since a plastic bag will not prevent the mercury vapor from escaping, remove the plastic bag(s) from the home after cleanup.)
2.Use sticky tape, such as duct tape, to pick up any remaining small glass fragments and powder. Place the used tape in the glass jar or plastic bag.
3.Vacuuming of carpeting or rugs during cleanup is not recommended unless broken glass remains after all other cleanup steps have been taken. [NOTE: It is possible that vacuuming could spread mercury-containing powder or mercury vapor, although available information on this problem is limited.] If vacuuming is needed to ensure removal of all broken glass, keep the following tips in mind:
◦Keep a window or door to the outdoors open;
◦Vacuum the area where the bulb was broken using the vacuum hose, if available, and
◦Remove the vacuum bag (or empty and wipe the canister) and seal the bag/vacuum debris, and any materials used to clean the vacuum, in a plastic bag.
4.Promptly place all bulb debris and cleanup materials, including vacuum cleaner bags, outdoors in a trash container or protected area until materials can be disposed of properly.
◦Check with your local or state government about disposal requirements in your area. Some states and communities require fluorescent bulbs (broken or unbroken) be taken to a local recycling center.
5.Wash your hands with soap and water after disposing of the jars or plastic bags containing bulb debris and cleanup materials.
6.Continue to air out the room where the bulb was broken and leave the H&AC system shut off, as practical, for several hours
Future Cleaning of Carpeting or Rugs: Air Out the Room During and After Vacuuming
1.The next several times you vacuum the rug or carpet, shut off the H&AC system if you have one, close the doors to other rooms, and open a window or door to the outside before vacuuming. Change the vacuum bag after each use in this area.
2.After vacuuming is completed, keep the H&AC system shut off and the window or door to the outside open, as practical, for several hours.
Actions You Can Take to Prevent Broken Compact Fluorescent Light Bulbs
Fluorescent bulbs are made of glass and can break if dropped or roughly handled. To avoid breaking a bulb, follow these general practices:
•Always switch off and allow a working CFL bulb to cool before handling.
•Always handle CFL bulbs carefully to avoid breakage.
◦If possible, screw/unscrew the CFL by holding the plastic or ceramic base, not the glass tubing.
◦Gently screw in the CFL until snug. Do not over-tighten.
◦Never forcefully twist the glass tubing.
•Consider not using CFLs in lamps that can be easily knocked over, in unprotected light fixtures, or in lamps that are incompatible with the spiral or folded shape of many CFLs.
•Do not use CFL bulbs in locations where they can easily be broken, such as play spaces.
•Use CFL bulbs that have a glass or plastic cover over the spiral or folded glass tube, if available. These types of bulbs look more like incandescent bulbs and may be more durable if dropped.
•Consider using a drop cloth (e.g., plastic sheet or beach towel) when changing a fluorescent light bulb in case a breakage should occur. The drop cloth will help prevent mercury contamination of nearby surfaces and can be bundled with the bulb debris for disposal.
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About one year ago Glenn Beck had some go outside in front of his studio and act all this out. VERY funny bit and tragic that this is what we have come to.
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**Oh, it gets even better!
http://www.washingtonpost.com/wp-dyn/content/article/2010/09/07/AR2010090706933.html
Light bulb factory closes; End of era for U.S. means more jobs overseas
Lights out for ordinary bulbs made in the U.S.
The last major U.S. factory making ordinary incandescent light bulbs will soon be closing. When it does, the remaining 200 workers at the Winchester, Va., plant, about 70 miles west of Washington, D.C., will lose their jobs, marking a small, sad exit for a product that began with Thomas Alva Edison's innovations in the 1870s.
By Peter Whoriskey
Wednesday, September 8, 2010; 9:48 PM
WINCHESTER, VA. - The last major GE factory making ordinary incandescent light bulbs in the United States is closing this month, marking a small, sad exit for a product and company that can trace their roots to Thomas Alva Edison's innovations in the 1870s.
The remaining 200 workers at the plant here will lose their jobs.
"Now what're we going to do?" said Toby Savolainen, 49, who like many others worked for decades at the factory, making bulbs now deemed wasteful.
During the recession, political and business leaders have held out the promise that American advances, particularly in green technology, might stem the decades-long decline in U.S. manufacturing jobs. But as the lighting industry shows, even when the government pushes companies toward environmental innovations and Americans come up with them, the manufacture of the next generation technology can still end up overseas.
What made the plant here vulnerable is, in part, a 2007 energy conservation measure passed by Congress that set standards essentially banning ordinary incandescents by 2014. The law will force millions of American households to switch to more efficient bulbs.
The resulting savings in energy and greenhouse-gas emissions are expected to be immense. But the move also had unintended consequences.
Rather than setting off a boom in the U.S. manufacture of replacement lights, the leading replacement lights are compact fluorescents, or CFLs, which are made almost entirely overseas, mostly in China.
Consisting of glass tubes twisted into a spiral, they require more hand labor, which is cheaper there. So though they were first developed by American engineers in the 1970s, none of the major brands make CFLs in the United States.
"Everybody's jumping on the green bandwagon," said Pat Doyle, 54, who has worked at the plant for 26 years. But "we've been sold out. First sold out by the government. Then sold out by GE. "
Doyle was speaking after a shift last month surrounded by several co-workers around a picnic table near the punch clock. Many of the workers have been at the plant for decades, and most appeared to be in their 40s and 50s. Several worried aloud about finding another job.
"When you're 50 years old, no one wants you," Savolainen said. It was meant half in jest, but some of the men nod grimly.
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http://www.theaustralian.com.au/news/world/deadly-cost-of-green-light-bulbs/story-e6frg6so-1225708008534
Deadly cost of 'green' light bulbs
Michael Sheridan
From:The Australian
May 04, 2009 12:00AM
A HEAVY environmental price is being paid for the production of "green" light bulbs in China's cost-cutting factories.
Large numbers of Chinese workers have been poisoned by mercury, which forms part of the compact fluorescent light bulbs.
A surge in foreign demand, set off by an EU directive making these bulbs compulsory within three years, has also led to the reopening of mercury mines that have ruined the environment of a remote part of China.
Doctors, regulators, lawyers and courts in China are increasingly alert to the potential damage to public health of an industry that promotes itself as a friend of the Earth but depends on highly toxic mercury for its core product.
Making the bulbs requires workers to handle mercury in either solid or liquid form because a small amount of the metal is put into each bulb to start the chemical reaction that creates light.
Mercury is recognised as a health hazard by authorities worldwide because its accumulation in the body can damage the nervous system, lungs and kidneys, posing a particular threat to babies in the womb and young children.
The British Government says that if a compact fluorescent light bulb is broken in the home, the room should be cleared for between 15 and 30 minutes because of the danger of inhaling mercury vapour.
Former Howard government environment minister Malcolm Turnbull announced in February 2007 that by 2010 bulbs such as the compact fluorescents should be used to replace incandescent bulbs he had banned.
Documents issued by the Chinese Health Ministry, instructions to doctors and occupational health propaganda all describe mercury poisoning in lighting factories as a growing public health concern.
"Pregnant women and mothers who are breastfeeding must not be allowed to work in a unit where mercury is present," states one official rule book.
In southern China, compact fluorescent light bulbs destined for Western consumers are being made in factories that range from hi-tech multinational operations to sweatshops.
Tests on hundreds of employees have found dangerously high levels of mercury in their bodies, according to doctors and health officials in the cities of Foshan and Guangzhou.
Dozens of workers who were interviewed on condition of anonymity described living with the fear of mercury poisoning. They gave detailed accounts of medical tests that found numerous workers had dangerous levels of the toxin in their urine.
"In tests, the mercury content in my blood and urine exceeded the standard but I was not sent to hospital because the managers said I was strong and the mercury would be decontaminated by my immune system," said a young female employee, who provided her identity card.
Doctors at two regional hospitals said they had received patients from a factory run by major manufacturer Osram, which said its latest tests on workers had not found any with raised levels of mercury.
In one Chinese-owned factory, Foshan city officials intervened to order medical tests on workers at the Nanhai Feiyang lighting factory after receiving a petition alleging dangerous conditions, according to a report in the Nanfang Daily, an official newspaper. The tests found that 68 out of 72 workers were so badly poisoned they required hospitalisation.
A medical journal reported a survey of 18 light bulb factories near Shanghai, which found that exposure levels to mercury were higher for workers making the new compact fluorescent light bulbs than for other lights containing the metal.
The potential for litigation may be greatest in the ruined mountain landscape of Guizhou province in the southwest, where mercury has been mined for centuries. The land is scarred and many of the people have left.
Until recently, the conditions were medieval. Miners hewed chunks of rock veined with cinnabar, the main commercial source of mercury.
They inhaled toxic dust and vapours as the material seethed in primitive cauldrons to extract the mercury. Nobody wore a mask or protective clothing.
The Chinese Government shut down all the big mercury mining operations in the region in recent years in response to a fall in global mercury prices and rising concern over dead rivers, poisoned fields and ailing inhabitants.
But in this remote corner of a poverty-stricken province, demand for mercury had brought the miners back.
A Chinese entrepreneur, Zhao Yingquan, has paid $3 million for the rights to an old state-run mine. The Luo Xi mining company used thousands of prisoners to carve out its first shaft and tunnels in the 1950s.
The Sunday Times
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http://www.npr.org/templates/story/story.php?storyId=7431198
CFL Bulbs Have One Hitch: Toxic Mercury
by Elizabeth Shogren
February 15, 2007
The Environmental Protection Agency and some large business, including Wal-Mart, are aggressively promoting the sale of compact fluorescent light bulbs as a way to save energy and fight global warming. They want Americans to buy many millions of them over the coming years.
But the bulbs contain small amounts of mercury, a neurotoxin, and the companies and federal government haven't come up with effective ways to get Americans to recycle them.
"The problem with the bulbs is that they'll break before they get to the landfill. They'll break in containers, or they'll break in a dumpster or they'll break in the trucks. Workers may be exposed to very high levels of mercury when that happens," says John Skinner, executive director of the Solid Waste Association of North America, the trade group for the people who handle trash and recycling.
Skinner says when bulbs break near homes, they can contaminate the soil.
Mercury is a potent neurotoxin, and it's especially dangerous for children and fetuses. Most exposure to mercury comes from eating fish contaminated with mercury,
Some states, cities and counties have outlawed putting CFL bulbs in the trash, but in most states the practice is legal.
Pete Keller works for Eco Lights Northwest, the only company in Washington state that recycles fluorescent lamps. He says it is illegal to put the bulbs in the trash in some counties in Washington, but most people still throw them out.
"I think most people do want to recycle, but if it's not made easy, it doesn't happen," Keller says. "And they're small enough to fit in a trash can. So by nature, I think most people are not recyclers. So if it's small enough to fit in a trash can, that's where it ends up."
Experts agree that it's not easy for most people to recycle these bulbs. Even cities that have curbside recycling won't take the bulbs. So people have to take them to a hazardous-waste collection day or a special facility.
The head of the Environmental Protection Agency program concedes that not enough has been done to urge people to recycle CFL bulbs and make it easier for them to do so.
"I share your frustration that there isn't a national infrastructure for the proper recycling of this product," says Wendy Reed, who manages EPA's Energy Star program. That programs gives the compact bulbs its "energy star" seal of approval.
She says that even though fluorescent bulbs contain mercury, using them contributes less mercury to the environment than using regular incandescent bulbs. That's because they use less electricity — and coal-fired power plants are the biggest source of mercury emissions in the air.
"The compact fluorescent light bulb is a product people can use to positively influence the environment to... prevent mercury emissions as well as greenhouse gas emissions. And it's something that we can do now — and it's extremely important that we do do it," Reed says. "And the positive message is, if you recycle them, if you dispose of them properly, then they're doing a world of good."
Reed says the agency has been urging stores that sell the bulbs to help recycle them.
"EPA is actively engaged with trying to find a solution that works for these retailers around recycling the product, because it's really, really important," Reed says.
But so far, she says the biggest sellers of the bulbs haven't stepped up to the plate.
"The only retailer that I know of that is recycling is IKEA," she says, referring to the Swedish-owned furniture chain store.
Reed says the EPA has been prodding other retailers, such as Wal-Mart, to do more.
"We are working with Wal-Mart on it, we are making some progress. But no commitments have been made on the part of Wal-Mart," she says.
Wal-Mart didn't respond to requests for a comment on the issue.
EPA also has asked retailers to sell the lower mercury compact bulbs that some manufacturers are making. Engineers say you can't cut mercury out completely.
Some other big companies have started paying attention to the recycling problem.
General Electric has been making compact fluorescents for 20 years. Now the company admits that the little bit of mercury in each bulbs could become a real problem if sales balloon as expected.
"Given what we anticipate to be the significant increase in the use of these products, we are now beginning to look at, and shortly we'll be discussing with legislators, possibly a national solution here," says Earl Jones, a senior counsel for General Electric.
In fact, Jones said he was having his first talks with congressional staffers on Thursday.
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http://www.msnbc.msn.com/id/23694819/
Compact fluorescent light bulbs, long touted by environmentalists as a more efficient and longer-lasting alternative to the incandescent bulbs that have lighted homes for more than a century, are running into resistance from waste industry officials and some environmental scientists, who warn that the bulbs’ poisonous innards pose a bigger threat to health and the environment than previously thought.
Fluorescents — the squiggly, coiled bulbs that generate light by heating gases in a glass tube — are generally considered to use more than 50 percent less energy and to last several times longer than incandescent bulbs.
When fluorescent bulbs first hit store shelves several years ago, consumers complained about the loud noise they made, their harsh light, their bluish color, their clunky shape and the long time it took for them to warm up.
Since then, the bulbs — known as CFLs — have been revamped, and strict government guidelines have alleviated most of those problems. But while the bulbs are extremely energy-efficient, one problem hasn’t gone away: All CFLs contain mercury, a neurotoxin that can cause kidney and brain damage.
The amount is tiny — about 5 milligrams, or barely enough to cover the tip of a pen — but that is enough to contaminate up to 6,000 gallons of water beyond safe drinking levels, extrapolated from Stanford University research on mercury. Even the latest lamps promoted as “low-mercury” can contaminate more than 1,000 gallons of water beyond safe levels.
SNIP----
As long as the mercury is contained in the bulb, CFLs are perfectly safe. But eventually, any bulbs — even CFLs — break or burn out, and most consumers simply throw them out in the trash, said Ellen Silbergeld, a professor of environmental health sciences at Johns Hopkins University and editor of the journal Environmental Research.
“This is an enormous amount of mercury that’s going to enter the waste stream at present with no preparation for it,” she said.
Manufacturers and the EPA say broken CFLs should be handled carefully and recycled to limit dangerous vapors and the spread of mercury dust. But guidelines for how to do that can be difficult to find, as Brandy Bridges of Ellsworth, Maine, discovered.
“It was just a wiggly bulb that I reached up to change,” Bridges said. “When the bulb hit the floor, it shattered.”
When Bridges began calling around to local government agencies to find out what to do, “I was shocked to see how uninformed literally everyone I spoke to was,” she said. “Even our own poison control operator didn’t know what to tell me.”
The state eventually referred her to a private cleanup firm, which quoted a $2,000 estimate to contain the mercury. After Bridges complained publicly about her predicament, state officials changed their recommendation: Simply throw it in the trash, they said.
Break a bulb? Five steps for cleanup
That was the wrong answer, according to the EPA. It offers a detailed, 11-step procedure you should follow: Air out the room for a quarter of an hour. Wear gloves. Double-bag the refuse. Use duct tape to lift the residue from a carpet. Don’t use a vacuum cleaner, as that will only spread the problem. The next time you vacuum the area, immediately dispose of the vacuum bag.
In general, however, the EPA endorses the use of fluorescent bulbs, citing their energy savings. Silbergeld also does not discourage their use because of their energy savings, but she said the EPA could be sending mixed signals to confused consumers.
“It’s kind of ironic that on the one hand, the agency is saying, ‘Don’t worry, it’s a very small amount of mercury.’ Then they have a whole page of [instructions] how to handle the situation if you break one,” she said.
Limited options for safe recycling
The disposal problem doesn’t end there. Ideally, broken bulbs and their remains should be recycled at a facility approved to handle fluorescent lamps, but such facilities are not common.
California is one of only seven states — Minnesota, Ohio, Illinois, Indiana, Michigan and Wisconsin are the others — that ban disposing of fluorescent bulbs as general waste. And yet, qualified recycling facilities are limited to about one per county. In other states, collection of CFLs is conducted only at certain times of the year — twice annually in the District of Columbia, for example, and only once a year in most of Georgia.
In fact, qualified places to recycle CFLs are so few that the largest recycler of of fluorescent bulbs in America is Ikea, the furniture chain.
.
“I think there’s going to be hundreds of millions of [CFLs] in landfills all over the country,” said Leonard Worth, head of Fluorecycle Inc. of Ingleside, Ill., a certified facility.
Once in a landfill, bulbs are likely to shatter even if they’re packaged properly, said the Solid Waste Association of North America. From there, mercury can leach into soil and groundwater and its vapors can spread through the air, potentially exposing workers to toxic levels of the poison.
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http://www.telegraph.co.uk/health/8462626/Energy-saving-light-bulbs-contain-cancer-causing-chemicals.html
Energy saving light bulbs 'contain cancer causing chemicals'
Fears have been reignited about the safety of energy saving light bulbs after a group of scientists warned that they contain cancer causing chemicals.
Scientists claim that several carcinogenic chemicals are released when energy saving light bulbs are switched on
By Victoria Ward
7:16AM BST 20 Apr 2011
Their report advises that the bulbs should not be left on for extended periods, particularly near someone’s head, as they emit poisonous materials when switched on.
Peter Braun, who carried out the tests at the Berlin's Alab Laboratory, said: “For such carcinogenic substances it is important they are kept as far away as possible from the human environment.”
The bulbs are already widely used in the UK following EU direction to phase out traditional incandescent lighting by the end of this year.
But the German scientists claimed that several carcinogenic chemicals and toxins were released when the environmentally-friendly compact fluorescent lamps (CFLs) were switched on, including phenol, naphthalene and styrene.
Andreas Kirchner, of the Federation of German Engineers, said: “Electrical smog develops around these lamps.
“I, therefore, use them only very economically. They should not be used in unventilated areas and definitely not in the proximity of the head.”
British experts insisted that more research was needed and urged consumers not to panic.
Dr Michelle Bloor, senior lecturer in Environmental Science at Portsmouth University, told the Daily Express: “Further independent studies would need to be undertaken to back up the presented German research.”
The Department for the Environment insists the bulbs are safe, despite the fact that they contain small amounts of mercury which would leak out if the glass was broken.
Advice on its website states: “Energy efficient light bulbs are not a danger to the public.
“Although they contain mercury, limited at 5mg per lamp, it cannot escape from a lamp that is intact.
“In any case, the very small amount contained in an energy efficient bulb is unlikely to cause harm even if the lamp should be broken.”
The latest report follows claims by Abraham Haim, a professor of biology at Haifa University in Israel, that the bulbs could result in higher breast cancer rates if used late at night.
He said that the bluer light that CFLs emitted closely mimicked daylight, disrupting the body's production of the hormone melatonin more than older-style filament bulbs, which cast a yellower light.
The Migraine Action Association has warned that they could trigger migraines and skin care specialists have claimed that their intense light could exacerbate a range of existing skin problems.
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http://thegazette.com/2011/08/15/for-first-time-more-corn-to-be-used-for-ethanol-than-livestock/
For first time, more corn used for ethanol than livestock
15 August 2011 (Cedar RAPIDS, Iowa)
For the first time ever, more of the corn crop may go into gas tanks than into the stomachs of cattle and poultry destined for kitchen tables.
That fuel now tops livestock as the primary user of corn struck at least one observer as noteworthy.
“That’s a first-time-ever type of change,” University of Missouri Extension economist Ron Plain said in a statement released by the university.
“For forever,” Plain said, “ feed was the largest single use of corn.”
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This could just as easily have gone in the Liberal Fascism thread:
By RYAN TRACY
With solar panel prices falling and a prominent manufacturer in bankruptcy, the U.S. solar industry has been hard-pressed for good news. But Washington continues to hand out loan guarantees.
The Department of Energy says the guarantees will create U.S. jobs in the green-energy industry. But critics say the government is trying to pick winners instead of leaving that function to the marketplace, citing the struggles of several companies that received government funds.
SoloPower plans to use a $197 million federal loan guarantee for expansion. Above, one of the company's modules is installed on a roof.
The White House this month made final a $197 million guarantee for SoloPower Inc., a maker of lightweight solar panels in San Jose, Calif. Two more guarantees for solar manufacturers valued at a combined $425 million are due to be approved before a Sept. 30 deadline.
The funding comes from the 2009 economic-stimulus package, which set aside enough cash to back about $60 billion in loans for renewable energy and transmission projects. Congress twice has raided those funds, leaving enough to back $25 billion in loans. The DOE has until the Sept. 30 end of the federal government's fiscal year to dole out the funds or lose them.
While demand for solar panels is rising, competition from Chinese manufacturers has driven down prices and made it hard for U.S. makers to compete.
Evergreen Solar Inc. this month filed for bankruptcy protection after closing a Massachusetts plant built with the help of state and local subsidies. Evergreen's panel technology, which uses less polysilicon than competitors do, looked like a good bet in 2008, when prices of the material were high. Polysilicon's price has plummeted since.
Solyndra Inc., which received a $535 million loan guarantee from the DOE to build a factory in northern California in 2009, last year had to close an older factory and lay off workers.
Some European countries subsidize solar power and other renewable energy sources by guaranteeing producers electricity rates that will help offset the producers' costs, which are then passed on to consumers. But proposals for such "feed-in tariffs" in the U.S. have stalled at the federal level.
Jesse Pichel, a clean-energy analyst at investment bank Jefferies & Co., said feed-in tariffs would give market forces a greater role in picking winning technologies. "The government really should not be picking technology bets," Mr. Pichel said. "It's fraught with potential failures."
The DOE acknowledges that loan guarantees don't always pan out but are worthwhile nonetheless. "While not every company will succeed in this competitive industry, we believe that solar generation and manufacturing play a vital role in helping America win the clean energy race," said DOE spokesman Damien LaVera.
To compete with larger manufacturers in China, SoloPower is targeting a niche of commercial and industrial buildings. The company's panels are lighter and potentially less expensive to install on rooftops because they are built without glass, said Chief Executive Tim Harris. "You want to get as much power per roof as you can. We can simply get more panels on the roof," he said.
SoloPower will use the government-backed loan to build a plant in Portland, Ore., and to expand a factory in San Jose, Calif. The company expects the plants to employ 450 people at full production.
Without the guarantee, "the jobs would have ended up offshore, almost certainly," Mr. Harris said. "I don't think there would have been any way to get this financing here in the states."
As the loan-guarantee program runs out of stimulus funds, lawmakers on both sides of the aisle are looking for changes.
Senate Energy Committee Chairman Jeff Bingaman (D., N.M.) has said the loan-guarantee program "has not worked as well as we had hoped." The program, set up by Congress in 2005, didn't receive major funding until 2009.
Mr. Bingaman has introduced a bill to create an independently run clean-energy bank that could make direct loans or take a stake in projects. In theory, it would sustain itself after receiving about $10 billion in start-up funds from Congress. The full Energy Committee approved the proposal in July, but it still lacks a funding mechanism and has yet to be taken up on the Senate floor.
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A follow up here from the energy argument over on 'Glibness':
10 of the last 11 recessions were preceded by oil price spikes. http://reason.com/archives/2011/03/08/oil-price-shocks-and-the-reces Oil prices spike when supplies don't keep up with demand and especially when there are interruptions or fears of interruptions in times of tight supplies. This is not theoretical. Healthy economies have abundant supplies of reasonably affordable energy available. Places with unreliable energy supplies such as third world countries with frequent grid shutdowns make lousy locations for business expansions.
I don't understand the denial that our failure to produce sufficient energy is hurting our national security and our geo-political strength. We compete with China to import oil, but they are using our dollars. When our next confrontation with Russia comes we can ask, who artificially stimulated their economy at our expense? We did.
If oil prices can double in a period of months and not years, how can anyone deny the sensitive relationship between having adequate supplies and having affordable prices?
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The energy consulting firm Wood Mackenzie released a report on Wednesday http://www.api.org/Newsroom/upload/API-US_Supply_Economic_Forecast.pdf that attempted to quantify the additional jobs and revenue that would result from a relaxation of the federal government’s current anti-energy policies. You can read the report in its entirety, but here is the bottom line:
Wood Mackenzie’s analysis found that U.S. policies which encourage the development of new and existing resources could, by 2030, increase domestic oil and natural gas production by over 10 million boed, support an additional 1.4 million jobs, and raise over $800 billion of cumulative additional government revenue.
Wood Mackenzie compared a “current path case” against a “development policy case” to derive these figures. This is the current path case; i.e, continuation of the Obama administration’s policies:
• The “Current Path Case” assumes the following policy and regulatory initiatives:
• Continued “slow walk” of Federal permitting for offshore Gulf of Mexico
•The case assumes an increase from current offshore exploration and development activity levels, but not back to pre-Moratorium rates
• Tighter Federal hydraulic fracturing and water disposal regulations which are beyond the current state regulations
• Slow down of onshore drilling due to increased cost of well completions. Results in a negative impact on development economics
• No opening of new areas for exploration and development
• No new exploration and development in frontier areas of Alaska, Eastern Gulf of Mexico, Atlantic and Pacific offshore, and Federal Rockies
• Restrictions on new pipeline development from Canada
• Curtailment of oil sands pipeline infrastructure into the U.S.. No development of the Keystone XL pipeline or other future Canada to U.S. pipelines
If the federal government got serious about job creation, we would have the development policy case:
• The “Development Policy Case” assumes the following policy and regulatory initiatives:
• Opening of Federal areas that are currently “off limits” to exploration and development
• Commencement of leasing, drilling and development activity in currently closed regions. Regions to be opened include: Eastern Gulf of Mexico, portions of the Rocky Mountains, Atlantic OCS, Pacific OCS, Alaska National Wildlife Refuge (ANWR) – 1002 Area, National Petroleum Reserve, Alaska (NPRA) and Alaska offshore
• Lifting of drilling moratorium in New York State
• Commencement of drilling and development of Marcellus shale in New York State
• Increased rate of permitting in the offshore Gulf of Mexico
• Allows for a return to pre-Moratorium exploration and development activity
• Approval of the Keystone XL and other future Canada to U.S. oil pipelines
• Facilitates additional Canadian oil sands development, thereby increasing the demand for U.S. supplied equipment and infrastructure
• Regulation of shale resources remains predominately at the State level
• Environmental regulation of shale gas and tight oil plays are not duplicative or unduly burdensome. Permitting levels are at sufficient rates to develop resources in a timely manner
(http://pl-mgroup-akamai.powerlineblog.com/admin/ed-assets/2011/09/JobsCreated00661.jpg)
(http://pl-mgroup-akamai.powerlineblog.com/admin/ed-assets/2011/09/EnergyProduction08816.jpg)
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Doug said, "If oil prices can double in a period of months and not years, how can anyone deny the sensitive relationship between having adequate supplies and having affordable prices?"
I'm curious, if we drill, and let's say world oil prices in 10 years double, why would America have "affordable" oil prices? As a private enterprise, not to mention most oil companies are foreign owned,
they will sell their oil, where ever it is drilled, at the highest available price. Do you think they BP will give a "discount" to America for oil drilled here versus in Brazil or somewhere else? Nor
do I see how drilling will insure an "adequate supply" here in America. Again, the oil company will sell the oil to the highest bidder.
So drilling here has nothing to do with world oil prices, keeping the price of oil cheap in America, nor does it insure an adequate supply.
As before, I acknowledge a positive job impact. But please acknowledge a negative environmental impact.
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"As before, I acknowledge a positive job impact. But please acknowledge a negative environmental impact." The negative environmental impact on upper middle class white people, right JDN?
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"As before, I acknowledge a positive job impact. But please acknowledge a negative environmental impact." The negative environmental impact on upper middle class white people, right JDN?
:? :? :?
Frankly, it's a negative environmental impact on ALL people.
But probably, the richer you are, the less of an impact it will be. You have choices to move, probably you are not on site, etc.
So it's the average guy who is most affected. In my furniture example, the workers, although fired, probably were further ahead. They
will live longer and healthier being away from all those chemicals. The owner didn't care; he wasn't on site very often.
Your point GM??? Or are you off on one of your tangents that has no point?
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http://www.city-journal.org/2008/18_2_californias_environmentalism.html
A dirty secret about California’s energy economy is that it imports lots of energy from neighboring states to make up for the shortfall caused by having too few power plants. Up to 20 percent of the state’s power comes from coal-burning plants in Nevada, New Mexico, Utah, Colorado, and Montana, and another significant portion comes from large-scale hydropower in Oregon, Washington State, and the Hoover Dam near Las Vegas. “California practices a sort of energy colonialism,” says James Lucier of Capital Alpha Partners, a Washington, D.C.–area investment group. “They rely on western states to supply them with power generation they are unwilling to build for themselves”—and leave those states to deal with the resulting pollution.
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http://www.ceert.org/PDFs/reports/Coalreport.pdf
California’s dirty coal legacy
In 2004, coal plants located in the interior
West supplied an estimated 20% of all
electricity in California, which is twice
the share that comes from renewables.
Large quantities of air pollution are
discharged from these coal plants.
• The harmful sulfur dioxide emitted
from California’s share of out-of-state
coal plants exceeds the quantity of sulfur
dioxide released from all pollution
sources within the state of California.
• Ten times more smog-forming oxides of
nitrogen are released by California’s
v
share of distant coal plants than the total
amount of nitrogen oxides emitted
from all power plants within the state.
• California’s share of the mercury produced
from western coal plants is more
than 200 times the total amount emitted
from all power plants within the state
of California, which the EPA reported
was 9 pounds in 1999.
• Each year, California’s share of distant
coal plants releases a staggering 67
million tons of global-warming carbon
dioxide. The global warming pollution
emanating from these smokestacks is
equivalent to the emissions from more
than 11 million cars and cancels out
the reductions to be achieved by California’s
landmark global-warming
standards for motor vehicles and its
current renewable portfolio standard.
California buys power from coal
plants across the West. In addition,
major California electric utilities and
municipalities have a dedicated ownership
stake in some of the most-polluting
coal plants in the western United States.
Southern California Edison, the
Los Angeles Department of Water and
Power, the California Department of
Water Resources, the MSR Public
Power Agency, the Southern California
Public Power Authority, and the cities
of Anaheim, Riverside, Pasadena, Burbank,
and Glendale have various ownership
interests in the Four Corners and
San Juan power plants in New Mexico,
the Intermountain Power Project in
Utah, the Mohave and Reid Gardner
generating stations in Nevada, and the
Navajo Generating Station in Arizona.
These California-owned coal-fired
power plants are clustered in the heart
of the American Southwest, near the
renowned “golden circle” of national
parks and wilderness areas that includes
the Grand Canyon, Canyonlands, Bryce
Canyon, Arches, Capitol Reef, Mesa
Verde, and Zion national parks. This is
the great canyon country that inspired
John Wesley Powell,Wallace Stegner,
and millions of American families who
travel here from across the nation.
It also is a region hard hit by air pollution,
including unhealthy ozone levels,
haze that obscures scenic vistas, and
advisories against consuming mercurycontaminated
fish. The Navajo, Hopi,
Zuni, and many other native peoples
live, work, and raise families in this area.
Air quality in the areas around these
plants would not pass muster in California.
Over the past three years, San
Juan County in northern New Mexico
has monitored some 51 violations of
California’s health standard for ozone.
In addition, pollution levels at the Grand
Canyon have violated California’s ozone
health standard 40 times over the same
period, and 21 violations have been
recorded at Canyonlands National Park.
National Park Service data show that
ozone concentrations have significantly
worsened over the past decade at the
Grand Canyon, Mesa Verde, and
Canyonlands national parks.
A number of the region’s lakes and
reservoirs also suffer from mercury fish
consumption advisories. The water bodies
with protective warnings range from
Lake Mary in northern Arizona to the
McPhee, Narranguinnep, and Navajo
reservoirs in southwestern Colorado.
California’s appetite for coal-based
electricity has a major role in the air
pollution in the American West and the
global atmosphere.
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I will leave GM and JDN to work that particular point out, but in response to JDN's point about the fungibiity of oil and his assumption that therefor US oil will flow to the highest bidder, I could be wrong but I would interject that to the best of my recollection US law requires US oil to be sold in the US, though there may be an exception for Alaskan oil to Japan (and attendant purchases from Venezuela).
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https://www.hcn.org/issues/305/15750
SHIPROCK, New Mexico — Along Highway 64 between Shiprock and Farmington, drivers bold enough to crack a window and bask in the desert heat often get a whiff of tarry air — a clue that something industrial lurks beyond the sagebrush and sandstone. In fact, two coal-fired power plants sit behind ridges on either side of the road, less than 10 miles apart.
The Four Corners Power Plant and the San Juan Generating Station, long criticized as two of the dirtiest coal-fired power plants in the country, could soon have a new neighbor: the proposed Desert Rock Power Plant, slated for construction on the Navajo Reservation. If built, it would be the first major energy development in the region in over 30 years.
"We have the labor, the land, and the resources," says Steven Begay, general manager of the Diné Power Authority, which was formed 20 years ago to entice another coal-fired power plant onto the reservation. "The Navajo Nation is growing, so we have to think about our options."
Begay and other tribal officials see the $2.2 billion plant as a way to spur economic growth; unemployment hovers above 40 percent on the reservation. When the plant begins operation in 2010, says Begay, it will provide nearly 400 long-term jobs and generate about one-third of the tribe’s annual budget in royalties and leases.
But Sarah White, president of Dooda Desert Rock, one of several Navajo groups opposing the development, disagrees about what the coal-fired plant will bring to the tribe. "We won’t benefit from it. We’ll get the trash, the smoke and the dirt," says White, who lives 15 miles from the proposed site. "I really want to believe that this is something that will work, but when I look at … San Juan and Four Corners, I see nothing but broken promises."
Clearing the way
The new power plant is a joint project of the Diné Power Authority and Houston-based Sithe Global Power, which have already surveyed a 591-acre site for the plant and bought the grazing rights of six local ranchers.
Sithe and the power authority held off-reservation scoping meetings in cities such as Albuquerque, Phoenix and Farmington. They also visited Navajo chapter houses near the site, hoping to build support for the project. Instead, four chapters passed resolutions opposing it. Only one passed a resolution in support, but it did so with a sense of resignation: "This chapter understands that this is going to happen no matter what the people say," says Arthur Bavaro, Nenahnezad Chapter manager.
The resolutions are mostly symbolic: They have no direct impact on the plant approval process, which is handled by the Bureau of Indian Affairs. If the plans are approved, construction could begin by next year.
Only 61 percent of Navajo homes currently have electricity, but that isn’t likely to change with the new power plant nearby. Connecting transmission lines to isolated dwellings is too expensive. Instead, the plant’s 1,500 megawatts of electricity will be sold to cities like Phoenix and Las Vegas.
"Navajos are going through hardship just so someone in Los Angeles can run their lights day in and day out," says Lori Goodman, a board member of Diné Citizens Against Ruining Our Environment, a Navajo environmental group.
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A dirty secret about California’s energy economy is that it imports lots of energy from neighboring states to make up for the shortfall caused by having too few power plants. Up to 20 percent of the state’s power comes from coal-burning plants in Nevada, New Mexico, Utah, Colorado, and Montana, and another significant portion comes from large-scale hydropower in Oregon, Washington State, and the Hoover Dam near Las Vegas. “California practices a sort of energy colonialism,” says James Lucier of Capital Alpha Partners, a Washington, D.C.–area investment group. “They rely on western states to supply them with power generation they are unwilling to build for themselves”—and leave those states to deal with the resulting pollution.
GM; that is kind of my point. CA is smart. We don't want the "trash, the smoke and the dirt". Energy production is dirty. That's why I am happy oil is being produced in Brazil. Overall, Brazil seems to be destroying their eco systems. Better them than us.
Crafty, no that is not true. Oil will flow to the highest bidder. Even if Congress someday mandated that oil drilled in America must be sold to America (highly unlikely) I can't imagine that they would not be allowed to charge the going rate.
http://www.scientificamerican.com/article.cfm?id=can-offshore-drilling-make-us-independent
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GM; that is kind of my point. CA is smart. We don't want the "trash, the smoke and the dirt". Energy production is dirty. That's why I am happy oil is being produced in Brazil. Overall, Brazil seems to be destroying their eco systems. Better them than us.
Them? Like the Navajo?
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"As before, I acknowledge a positive job impact. But please acknowledge a negative environmental impact."
I abhor wanton the spewing of poisons and I don't know anywhere in America where that is still allowed. There is no freedom to recklessly poison your neighbor.
Where I live, the air and water quality has only gotten cleaner in my lifetime, both are rated an A by even the most extreme environmental activists. When we continue to emit less and less and cleaner and cleaner, the impact of these emissions is actually positive - because the earth at least where I am is cleaning itself faster than we are polluting.
Now, did you answer my question about how many vehicles the State of California (government) owns? - or the federal government. The best thing government could do right now to lower energy usage would be to radically downsize their own operations. Has any leftist thought of THAT?
The most prosperous countries have historically and consistently been the cleanest. Being poor doesn't solve problems. You ignored the distinction between putting sulfur and soot in the air and the fact that the cleanest burning of a fossil fuel still releases CO2. So does a deer, a moose and an eagle, lol. I'm okay with reasonable steps to use everything more cleanly, wisely and efficiently. I also favor keeping some freedoms such as the freedom to emit small amounts of CO2 for a non-essential drive to have the kids visit Grandma. Do you favor a total immediate ban on all recreational and non-essential uses of gasoline, or why not? Do you agree with the Obamas' behavior (and Edwards, Reid, Pelosi, Gore, etc.) that if it's me doing it, and I am important, who cares?
BTW, whatever happened to Huntsman's natural gas for transportation initiative. That is the cleanest of the fossil fuels, yet the left has begun a war against it. I favor all affordable and reasonable efforts to clean up our act and I will put my footprint up against anyone for frugality and efficiency. For this so-called hottest summer on record and we used one portable air conditioner for one hour, the first time in more than a dozen years. I have an electric bike, a wind powered boat, a 40 mpg old car, a light duty solar system, I've filled dozens of houses with small CFL bulbs, smaller high efficiency furnaces and 1.0 gpm showerheads, I close off from heat at all the coldest and draftiest parts of our house in winter and I carpooled Saturday to visit my friend who just sold his company for a billion dollars. That said, I don't favor federal mandates to make everyone do all these things. Everyone's circumstances are different.
Alleging that the world's second largest producer of oil, who intentionally leaves it's resources in the ground and skews the whole world market, cannot make an impact on price is economically absurd and patently false. Maybe we can take a sharp political turn here toward energy production, test the theory and prove one of us wrong. Oil prices work off of a futures market. The impact of new production on prices will hit long before the product makes it to market.
Yes there is a world price for oil, but location matters and so does refining capacity and output. If we could quit (the net) import of oil (prohibiting import and export makes no sense), the world market would return to its natural balance, where buyers and sellers come to agreement, presumably much lower than it is today with America using its (eroding) wealth to disproportionately buy up available supplies. Besides rescuing our economy, that move would favor economic growth in all markets that buy our other products and help to alleviate poverty in third world countries. You deny that or oppose that?
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For all its soaring rhetoric, President Obama's "jobs speech" last week didn't demonstrate a lick of insight into why economies grow or how wealth is created. It was merely trademark Obamanomics: using government diktat to move money that's over here, over there.
Having spent an hour the day before with Ron Liepert, the energy minister from the Canadian province of Alberta, I found it especially disturbing to hear nothing in the speech about reversing the administration's anti-fossil-fuels agenda. Canada has recovered all the jobs it lost in the 2009 recession, and Alberta's oil sands are no small part of that. The province is on track to become the world's second-largest oil producer, after Saudi Arabia, within 10 years. Meanwhile Mr. Obama clings to his subsidies for solar panels and his religious faith in green jobs.
U.S. unemployment is high because capital is on strike. Short-term offers to coax investors into taking new risks aren't going to cut it when they have been forewarned that the president intends to pay for it all by raising taxes in the out years. The market dropped over 300 points the day after Mr. Obama's speech.
On the regulatory front the picture is even gloomier. Much of America's vast untapped energy potential lies dormant because Mr. Obama's regulatory watchdogs have spent the past three years throwing sand in the gears of the permitting process for exploration and exploitation on federal lands. Separately, TransCanada has been trying since September 2008 to get a permit to build the Keystone XL pipeline from Alberta to the Gulf Coast. The Environmental Protection Agency has so far blocked it.
Enlarge Image
CloseAssociated Press
TransCanada's Keystone XL pipeline could mean 118,000 American jobs, if the U.S. government ever issues the permit.
.A glimpse of what all this has cost the U.S. economy can be seen by looking north to Canada, where animal spirits have been unleashed in the energy sector. Canada's close economic ties to the U.S. have traditionally meant that when the U.S. gets the sniffles, Canada gets swine flu. This time it's been different. Part of the reason is that Canada's housing market was not poisoned by a federal government push to put unqualified borrowers into homes they could not afford. After the 2008 collapse of the housing bubble in the U.S., the Canadian financial sector remained strong.
That alone was not enough to protect Canada from the effects of the U.S. recession. The manufacturing sector was hit hard, and in the first quarter of 2009 the economy contracted by an annualized 7.9%.
Yet Canada has outperformed the U.S. since then. In 2010, according to the International Monetary Fund, Canada grew at 3.2% versus 2.9% in the U.S. In 2011, the IMF estimates Canada will grow at 2.9%; unemployment is now 7.3%. The IMF's U.S. growth forecast is 2.5% this year, and U.S. unemployment is 9.1%.
One explanation for Canada's more robust growth is its strong commitment to energy, which has become more valuable in U.S. dollar terms under Federal Reserve Chairman Ben Bernanke's inflationary policies. Alberta is now producing two million barrels per day but expects that number will grow to four to five million within a decade.
Alberta's oil and gas industry supports more than 271,000 direct jobs and hundreds of thousands of indirect jobs in sectors such as construction, manufacturing and financial services. The province has an unemployment rate of 5.6%. There are also some 960 American companies involved in Alberta energy, supplying equipment and technology, among other things. As an example, Mr. Liepert says, "dozens of Caterpillar tractors, made in Illinois and Michigan and costing $5 million a piece" work the oil sands. He says the region is on track to create more than 400,000 direct American jobs by 2035. The Bakken region of North Dakota, where private land ownership gives drillers relief from federal obstructionism, shares a similar, if smaller, story. Oil production there is booming, and North Dakota unemployment is 3.3%.
The Americas in the News
Get the latest information in Spanish from The Wall Street Journal's Americas page.
.TransCanada's Keystone XL pipeline, if the U.S. ever issues the permit, will mean $20 billion in investment. The company says the construction phase will require 13,000 direct hires and indirect new jobs could total 118,000 in the U.S.
But Keystone XL is only a fraction of the potential that could be released if Mr. Obama changed his energy policy. In a study commissioned by the American Petroleum Institute and released last week, the energy consultancy Wood MacKenzie estimates that pro-development policies could, by 2030, "support an additional 1.4 million jobs, and raise over $800 billion of cumulative additional government revenue."
On the other hand, according to the study, current policies "which slow down the issuance of leases and drilling permits, increase the cost of hydraulic fracturing through duplicative water or air quality regulations, or delay the construction of oil sands export pipelines such as Keystone XL, will likely have a detrimental effect on production, jobs, and government revenues."
A serious jobs proposal would address these issues. Mr. Obama doesn't have one.
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Doug said, "Yes there is a world price for oil, but location matters and so does refining capacity and output. If we could quit (the net) import of oil (prohibiting import and export makes no sense), the world market would return to its natural balance, where buyers and sellers come to agreement, presumably much lower than it is today with America using its (eroding) wealth to disproportionately buy up available supplies. Besides rescuing our economy, that move would favor economic growth in all markets that buy our other products and help to alleviate poverty in third world countries. You deny that or oppose that?"
"Alleging that the world's second largest producer of oil, who intentionally leaves it's resources in the ground and skews the whole world market, cannot make an impact on price is economically absurd and patently false."
Actually it's "patently" true. :-D (by the way, we are the third largest producer, but more importantly our reserves don't even rank in the top 10) http://exploredia.com/oil-reserves-by-country-2011/
It's not a matter of "opposing". As for denying, please read my links; look up additional links, even look at Crafty's immediate previous post. The American Petroleum Institute doesn't even believe it. NO ONE, at least no one knowledgable :-) (maybe you do) says if we increase drilling we will lower world oil prices. So forget that issue; it's moot. Drilling more in America will not affect world prices. Keep repeating that..... until you understand.
All this talk of the "market return to it's natural balance" is garbage. No offense. And to say that move would "help to alleviate poverty in third world countries" is also garbage.
Crafty's point, and I believe you too Doug have made the point that employment will increase. More jobs. There I agree. That no doubt is a valid benefit of drilling.
My question is at what cost? You say the most prosperous countries are the cleanest. I'm not sure about that. China is truly terrible. And getting worse. So is India. So is Brazil......... Europe. It's a long list.... It's all real "garbage". You know better than your point. http://www.guardian.co.uk/news/datablog/2011/jan/31/world-carbon-dioxide-emissions-country-data-co2
Everyone knows energy, i.e. coal mines, spills from drilling for oil, nuclear, etc. do or could cause pollution; it's not rocket science. So I repeat, at what cost? I guess in my opinion, leave it up to the states.
If you want coal mines in your state, more employment, and are willing to sacrifice air quality and health, go for it. And if there is a spill, destroying beaches and ocean life, or air quality,
don't call the Federal Government, let that state pay for it itself. Sounds fair to me. But I bet the majority of Americans will vote "NIMBY".
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JDN, You may not believe supply or demand affect price but I would not recommend disclosing that right away if you are to apply for a job teaching economics, lol.
I'm sorry that you were duped on the term "proven oil reserves" in the United States. "...our reserves don't even rank in the top 10..." This one is not wholly your fault. You are repeating and reposting what other people are alleging without an interest in veracity.
“Proven oil reserves” in the U.S. only counts the petroleum that is available for development under current government regulations and it is 8.5 times understated from what the best science available tells us, and this figure doesn’t include oil shale, which has recoverable reserves of 1 trillion barrels, according to DOhttp://epw.senate.gov/public/index.cfm?FuseAction=Files.View&FileStore_id=04212e22-c1b3-41f2-b0ba-0da5eaead952
March 30, 2011 by John Hinderaker
On Energy, Obama Lies With Statistics
...
Obama: "America holds about 2 percent of the world’s proven oil reserves. What that means is, is that even if we drilled every drop of oil out of every single one of the reserves that we possess — offshore and onshore — it still wouldn’t be enough to meet our long-term needs. We consume about 25 percent of the world’s oil. We only have 2 percent of the reserves. Even if we doubled U.S. oil production, we’re still really short."
This is a perfect example of lying with statistics. Obama knows that most people assume that “proven oil reserves” equals oil known to be in the ground. And, in fact, in most countries around the world, that is more or less what it does mean. In Saudi Arabia, for example, “proven oil reserves” are whatever the government announces they are.
But in the United States, “proven oil reserves” is a legal term, not a scientific term. It is defined by the Securities and Exchange Commission. We wrote about this in detail in Obama’s Long Nose On Energy. This is the definition, unique to United States law, of “proven oil reserves:”
Proved reserves. The quantities of hydrocarbons estimated with reasonable certainty to be commercially recoverable from known accumulations under current economic conditions, operating methods, and government regulations. Current economic conditions include prices and costs prevailing at the time of the estimate. Estimates of proved reserves do not include reserves appreciation.
The definition is in part economic; every time the price of oil rises, our “proved reserves” rise, too; likewise when the price falls. Most important, however, is that “proven oil reserves” only counts the petroleum that is available for development under current government regulations. So, to take two obvious examples, the petroleum in ANWR is not included in our “proven oil reserves,” even though the petroleum there is known to be vast, nor is the offshore petroleum in those areas–the large majority–where drilling is not permitted by current law. It is not nature, but Barack Obama and Congress that are limiting America’s energy resources.
It is disgraceful that the President of the United States is willing to deliberately mislead the American people in order to justify billions, if not trillions, of dollars in wasteful, politically-motivated boondoggles.
http://www.powerlineblog.com/archives/2011/03/028724.php
http://epw.senate.gov/public/index.cfm?FuseAction=Files.View&FileStore_id=04212e22-c1b3-41f2-b0ba-0da5eaead952
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The Institute for Energy Research writes:
In a recent report, CRS [the Congressional Research Service] said that the U.S. has 19.1 billion barrels of proven reserves, which is the number President Obama cites as 2% of the world’s oil. CRS, however, showed that between our proven reserves and oil predicted to be found, there is likely to be a combined 164.1 billion barrels, or 8.5 times as much as the president alleges. And this figure doesn’t include oil shale, which has recoverable reserves of 1 trillion barrels, according to DOE.
http://www.powerlineblog.com/archives/2011/03/028574.php
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"JDN, You may not believe supply or demand affect price but I would not recommend disclosing that right away if you are to apply for a job teaching economics, lol."
A simple question. Does increased supply act to lower prices? Yes or no.
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GM; that is kind of my point. CA is smart. We don't want the "trash, the smoke and the dirt". Energy production is dirty. That's why I am happy oil is being produced in Brazil. Overall, Brazil seems to be destroying their eco systems. Better them than us.
Them? Like the Navajo?
Manifest destiny, JDN? Your lungs must be protected, too bad for the Navajo? California uber alles?
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"JDN, You may not believe supply or demand affect price but I would not recommend disclosing that right away if you are to apply for a job teaching economics, lol."
A simple question. Does increased supply act to lower prices? Yes or no.
Or from Doug, "JDN, You may not believe supply or demand affect price but I would not recommend disclosing that right away if you are to apply for a job teaching economics, lol."
Doug, a lot of the guys I quoted could apply for a job teaching economics. But let me repeat myself since it is on another thread. This is not Obama, but Oil Experts saying that
our increased production will NOT affect world oil prices. Got it? Will not affect world oil prices.... :-D
"The problem is this: While increased oil and gas drilling in the United States may create good-paying jobs, reduce reliance on foreign oil and lower the trade deficit, it will have hardly any impact on gas and oil prices.
That's because the amount of extra oil that could be produced from more drilling in this country is tiny compared to what the world consumes.
Plus, any extra oil the country did produce would likely be quickly offset by a cut in OPEC production.
"This drill drill drill thing is tired," said Tom Kloza, chief oil analyst at the Oil Price Information Service, which calculates gas prices for the motorist organization AAA. "It's a simplistic way of looking for a solution that doesn't exist."
http://money.cnn.com/2011/04/25/news/economy/oil_drilling_gas_prices/index.htm
According to the CONSERVATIVE American Enterprise Institute,
Ken Green, resident scholar with the American Enterprise Institute think tank.
But experts disagreed about how much impact additional drilling could have. Crude oil is a global commodity, Green said.
"The world price is the world price," Green said. "Even if we were producing 100 percent of our oil," he said, if prices increase because of a shortage in China or India, "our price would go up to the same thing.
"We probably couldn't produce enough to affect the world price of oil," Green added. "People don't understand that."
I think Green was talking to you. :evil:
GM, I'll try and dumb it down for you. If you buy another six pack of beer tonight your "demand" will not affect world beer prices. Or if Anheuser Busch increased their production, it would not affect world beer prices. Like oil, beer is a global commodity. As was said above, "That's because the amount of extra oil that could be produced from more drilling in this country is tiny compared to what the world consumes." The same analogy applies to your beer.
Time to move on; it's hard arguing with people who don't get simple math. Or economics. Or reject nearly all experts. There may be good reasons to drill, but affecting world prices is not one of them.
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What was the point of Obama tapping the SPR then? Lowering prices?
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What was the point of Obama tapping the SPR then? Lowering prices?
C'mon JDN. Why did Obama tap the SPR? What was he trying to do?
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Just as oil is fungible, to a certain partial extent, various forms of energy are fungible. I may be misusing some of the terms, but Baraq has waged war on oil (offshore and otherwise) coal, tar sands, shale oil, natural gas (the fracking issue, which is one I for one do not shrug off) and so forth. I think if we were to pursue growth oriented polices with all of these, US energy prices would be lower than would otherwise be the case.
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What was the point of Obama tapping the SPR then? Lowering prices?
C'mon JDN. Why did Obama tap the SPR? What was he trying to do?
It was good PR. That's about it. No long term affect on oil prices.
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What was the point of Obama tapping the SPR then? Lowering prices?
C'mon JDN. Why did Obama tap the SPR? What was he trying to do?
It was good PR. That's about it. No long term affect on oil prices.
Good PR how? No, there was no long term impact on prices because it was a one shot deal, as I pointed out at the time. Another stupid Obama "stimulus". Now, if he had domestic oil production instead, you would see an drop in price.
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Crafty: "...US energy prices would be lower than would otherwise be the case."
It's not my post but I would like to insert the word *significantly* lower.
The point is that the price is artificially high right now because of a social engineering experiment. Our government doesn't want us to drive, or manufacture, or recreate, etc. We need to urgently get the production all the way up to just the level that is safe and efficient to produce in the context of the times we live in and then people can adjust and make their decisions about where to live, what to drive, where to locate their businesses, where to vacation, etc.
If the same amount of government control and intervention had been exerted on the consumption side, perhaps an IRS style agent at every gas station scrutinizing your mileage log about where you drove and why, we would be in an uproar. Instead we stifle production and go after the consumer like a frog in water on a heating stove.
JDN's argument that a little more production won't make a noticeable impact is what they said about ANWR. They said the oil at full production wouldn't even make to market for 10 years. That was more that 10 years ago! Large projects like that and others tell the world that we are going to produce. That weakens the power of the cartels and motivates other suppliers to get their product to market. Futures markets do not wait 10 years to respond. The effect on prices of a serious change in policy would be nearly immediate and yes it would be global.
Demand at the margin is very inelastic because people already only buying what they need to do the things they want to do. The amount of supply at the margin is extremely, extremely crucial in determining price. Even the perception of future supplies moves prices.
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Indeed! Look at the volatility of the oil futures market!
Though in fairness it should be noted that the low margin requirements may well magnify the volatiility.
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We created more dollars and they dropped in value, but creating more oil won't cause it to cost less. At least not in JDN's little world. :roll:
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http://www.torontosun.com/2011/06/17/saudis-have-west-over-a-barrel
Saudis have West over a barrel And they don’t want to hear about oilsands development
By Ezra Levant ,QMI Agency
First posted: Sunday, June 19, 2011 02:00 AM EDT
An OPEC billionaire has publicly said what everyone long suspected, but just hadn’t heard out loud before: Saudi Arabia doesn’t want the world to develop unconventional sources of oil, like Canada’s oilsands.
Saudi Prince Al-Waleed bin Talal, the world’s 26th richest man, worth more than $19 billion, told CNN he’s worried if oil prices stay around $100 a barrel, the West will look for other sources of oil and Saudi Arabia would lose its dominant position.
“We don’t want the West to go and find alternatives,” he said, “because, clearly, the higher the price of oil goes, the more they have incentives to go and find alternatives.” Give the sheik full marks for honesty. Saudi Arabia has the West just where they want us. They don’t want us getting any big ideas that would reduce our dependence on his dictatorship, and terrorist states like Iran.
It’s like when the head of Russia’s state-controlled natural gas company, Gazprom, denounced new technologies to produce shale gas, saying he was worried about the safety of “American housewives.” No, Gazprom executives and Vladimir Putin are not concerned about human rights and environmentalism in Russia, let alone the West. They’re concerned about competition that would free America and Europe from reliance on Putin’s natural gas.
The Saudi sheik didn’t condemn the oilsands by name — he just condemned what he called “alternative” sources of oil. But he couldn’t have been talking about anyone else. There are more than 170 billion barrels of oil in the oilsands we can recover with today’s technology. That’s 300 years worth at the rate we’re producing it. It’s the world’s second largest oil reserves, after Saudi Arabia.
But there are another 1.7 trillion barrels in place in the oilsands that we don’t yet have the technology to get out economically. That’s what this Saudi sheik is worried about. If oil stays at $100 a barrel, it’s worth it for Canadian scientists to invest in new technologies to get at that 1.7 trillion barrels.
It’s pretty tough to like Saudi sheiks, Iranian ayatollahs and Russian former KGB agents. Which is why you don’t usually see those folks attacking the oilsands in public. Prince Al-Waleed’s comments were a rare Saudi public criticism of the West. Normally, they leave that sort of thing to their allies — professional environmental lobbyists.
There are about 100 professional anti-oilsands activists in Canada, who do nothing but attack Canada’s oil industry. Typically they pose as grassroots environmentalists. But the facts are different.
Most environmental activists are actually paid professionals. And most work for foreign lobbyists.
Greenpeace, for example, is a $200-million multinational corporation based in Europe. If they don’t raise a million bucks a day in fundraising, they’d have to shut down.
As Vivian Krause has documented, the U.S. Tides Foundation, their Canadian arm Tides Canada and other foreign foundations have pumped about $200 million into Canada to fight development of the oilsands and forestry, among other causes. Imagine if Canadian lobbyists pumped $200 million into the U.S. to meddle in their political decisions: Congress would hold hearings and the Pentagon would go to Defcon 1.
The professional environmentalist movement is neither Canadian nor grassroots. It’s foreign, professional and well funded.
It may not be funded directly by Saudi Arabia — we have no evidence of that.
But every time a Canadian oil company is slowed down or our pipeline projects are delayed, it is another day the OPEC near-monopoly continues.
Canada’s environmental extremists might not be working directly for Sheik Al-Waleed, but they’re doing his bidding.
If he could send a message to Greenpeace, it would be one word: Shokran — thank you, in Arabic.
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Gosh, I'd hate to deprive the Saudis the ability to fund the global jihad and the Neo-Soviets.
Don't they know that oil production has no impact on price? :roll:
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"[producing oil is] a simplistic way of looking for a solution that doesn't exist"
Good f'ing grief.
"Doug...This is not Obama, but Oil Experts saying that our increased production will NOT affect world oil prices. Got it? Will not affect world oil prices...."
And you understand that I oppose rule by experts and I think they are full of sh*t and I gave you specific information as to why. Repeating BS doesn't make it smell better. Got it! :wink: Did you see the price volatility charts I posted. Who with a sane mind thinks that these input factors around the world don't move price in that market? The answer is clearly someone with a competing agenda and non-existent professional morals, unless you are quoting them out of context. I don't have time to chase down the motives of why a scientist, a politician or a think tank is willing to deceive to accomplish their anti-production agenda. It is simply not rational to allow consumption, prohibit production, wonder why the economy tanks, say you have a laser focus on jobs, then not pick any of the low hanging fruit in the job growth business. The Obama administration even admitted those are the easy jobs to add when they attack their enemy Texas. Shameful. They should ask themselves, what are their job growth numbers without Texas.
Experts also said it would create a million new jobs in a very short order.
That part is obvious. My point is that it also affects every other sector of the economy. If you deny supply affects price, then that point is moot - with you. Still you could give me the courtesy of an answer on what part of demand for energy, if that is where we choose to attack this, comes from our bloated public sector. Not a mention of that from a guy who travels with his family in separate jets.
The repetitive loop here includes no acknowledgment whatsoever that the data these 'experts' base their nonsense on is off by a factor of 8.5 not counting a trillion barrels of recoverable oil from shale. It is okay for you to exclude these proven reserves because others more credentialed than either one of us did?
I have made no impact on you but it was fun to see my words picked up again by the WSJ. :wink:
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(Crafty;)"Indeed! Look at the volatility of the oil futures market! Though in fairness it should be noted that the low margin requirements may well magnify the volatility."
Yes, but on the downward side those forces magnify the move down. The world oil price would easily be cut in half at least momentarily. The question is where would the equilibrium price land and it would certainly be *significantly* lower than where it is now. More importantly, the runaway increases would be halted as supplies become less volatile so that business people in this one respect could begin to make business decisions with some sort of confidence.
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http://www.nationalreview.com/articles/277246/achieving-2-gas-robert-zubrin
September 15, 2011 4:00 A.M.
Achieving $2 Gas
It’s possible, with the right policy.
Republican presidential contender Michele Bachman has said that if she is elected, gas prices will fall to $2 per gallon. Such promises have understandably been greeted with considerable skepticism. But $2 gas is exactly what America needs. The question is, how can we get it?
We can’t do it just by expanded domestic drilling. In order for gasoline prices to fall to $2 per gallon, oil prices must be cut to $50 per barrel. And oil prices are set globally, with the dominating influence being the OPEC oil cartel. Since 1973, this cartel, which controls 80 percent of the earth’s commercially viable oil reserves, has refused to expand production, thus keeping petroleum prices artificially high. While, with a more pro-business government, the United States might conceivably be able to expand its production by a million or two barrels per day, OPEC could easily counter by cutting its production to match, or more likely, by simply continuing its non-expansion policy and letting increased Chinese demand take care of the slack.
If we are ever to get $2 gas, the power of OPEC to control oil prices needs to be broken. The United States Congress could do this with a stroke of the pen, simply by passing the bipartisan Open Fuel Standard bill (H.R. 1687). This act would effectively destroy OPEC by requiring that all new cars sold in the USA be fully flex fuel, able to run equally well on gasoline, ethanol, and — most important — methanol. This latter capability is critical because methanol can be, and is, made cheaply in large quantities from coal, natural gas, or any kind of biomass without exception. The United States has only 4 billion tons of oil reserves, but we have 270 billion tons of coal, vast amounts of natural gas, and an enormous capacity to produce biomass. By requiring that all cars sold here (and thus all cars made worldwide) be compatible with methanol, the act would force oil to compete with a fuel whose sources are not controlled by the cartel, and that we and our allies possess in abundance.
Methanol has only about half the energy per gallon as gasoline, but is 105 octane, which means it can be burned more efficiently. Taken together, these two factors make methanol’s current spot price of $1.38 per gallon roughly competitive with $2 gasoline.
Of course, the passage of the OFS bill would not cause gasoline prices to crash instantly. While it would no doubt hit oil futures hard, and thus cut the speculative premium on petroleum prices, the most immediate result of allowing methanol to compete against gasoline in the vehicle-fuel market would be to send methanol prices up, perhaps by as much as 60 percent. This situation would not, however, last for long. Methanol can be made and sold profitably today for $1.38 per gallon. At a 60 percent markup, its manufacture would be super-profitable, and massive amounts of capital would rush in to expand production. This would drive the price of methanol down, dragging gasoline and oil down prices with it, until methanol reached a price point where its production offered no greater profit than that prevailing in the economy at large. The fact that methanol would reach this price — what Adam Smith would term its natural price — follows from the fact that the sources to make methanol are plentiful and diverse, so that no cartel can artificially limit its production.
This underscores the key issue. There is not a free market in oil. Adjusted for inflation, the price of oil has increased eightfold since 1973, but OPEC production has not increased at all. In a free market, such a price increase would spur increased investment, with subsequent expanded production driving the price right back down again. That is why the inflation-adjusted price of coal, and nearly every other industrial commodity, has not risen in four decades. But because of the cartel, oil production has not responded to price increases in the way that it should in a properly functioning capitalist economy. In order for the free-enterprise system to do its work and deliver the cheap fuel the world needs, the ability of this cartel to limit the world’s liquid-fuel supplies needs to be broken. The Open Fuel Standard bill would accomplish that.
High oil prices are wrecking our economy. Since the United States imports 5 billion barrels of oil per year, the current price of nearly $90 per barrel will hit us for $450 billion this year alone, a huge tax on our economy. As a result, millions of jobs and thousands of businesses are being lost. If this wealth-draining process is allowed to continue, fiscal necessity will require us to withdraw the military forces protecting our national interests abroad, without a shot being fired.
Instead of seeking to exploit this catastrophe by placing its blame on their opponents, or posing with empty promises of salvation contingent upon their promotion to higher office, politicians need to take action. Two-dollar gas is not just a nice idea for inclusion in a campaign speech. It’s a critical necessity for economic recovery.
Either we break the cartel, or the cartel breaks us. The Open Fuel Standard bill needs to be passed.
— Robert Zubrin is a member of the Board of Advisors of Americans for Energy and author of Energy Victory: Winning the War on Terror by Breaking Free of Oil.
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http://www.youtube.com/watch?v=JOl4vwhwkW8&feature=player_embedded
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China Consolidates Grip on Rare Earths
By KEITH BRADSHER
BEIJING — In the name of fighting pollution, China has sent the price of compact fluorescent light bulbs soaring in the United States.
The price of compact fluorescent light bulbs has risen drastically in the last year because of the rising cost of rare earth metals.
By closing or nationalizing dozens of the producers of rare earth metals — which are used in energy-efficient bulbs and many other green-energy products — China is temporarily shutting down most of the industry and crimping the global supply of the vital resources.
China produces nearly 95 percent of the world’s rare earth materials, and it is taking the steps to improve pollution controls in a notoriously toxic mining and processing industry. But the moves also have potential international trade implications and have started yet another round of price increases for rare earths, which are vital for green-energy products including giant wind turbines, hybrid gasoline-electric cars and compact fluorescent bulbs.
General Electric, facing complaints in the United States about rising prices for its compact fluorescent bulbs, recently noted in a statement that if the rate of inflation over the last 12 months on the rare earth element europium oxide had been applied to a $2 cup of coffee, that coffee would now cost $24.55.
A pack of three 11-watt G.E. compact fluorescent bulbs — each the lighting equivalent of a 40-watt incandescent bulb — was priced on Thursday at $15.88 on Wal-Mart’s Web site for pickup in a Nashville, Ark., store. The average price for fluorescent bulbs has risen 37 percent this year, according to the National Electrical Manufacturers Association.
Wal-Mart, which has made a big push for compact fluorescent bulbs, acknowledged that it needed to raise prices on some brands lately. “Obviously we don’t want to pass along price increases to our customers, but occasionally market conditions require it,” Tara Raddohl, a spokeswoman, said. The Chinese actions on rare earths were a prime topic of conversation at a conference here on Thursday that was organized by Metal-Pages, an industry data firm based in London.
Soaring prices are rippling through a long list of industries.
“The high cost of rare earths is having a significant chilling effect on wind turbine and electric motor production in spite of offsetting government subsidies for green tech products,” said one of the conference attendees, Michael N. Silver, chairman and chief executive of American Elements, a chemical company based in Los Angeles. It supplies rare earths and other high-tech materials to businesses.
But with light bulbs, especially, the timing of the latest price increases is politically awkward for the lighting industry and for environmentalists who backed a shift to energy-efficient lighting.
In January, legislation that President George W. Bush signed into law in 2007 will begin phasing out traditional incandescent bulbs in favor of spiral compact fluorescent bulbs and other technologies. The European Union has also mandated a switch from incandescent bulbs to energy-efficient lighting.
Representative Michele Bachmann of Minnesota is running for the Republican presidential nomination on a platform that includes strong opposition to the new lighting rules in the United States and has been a leader of efforts by House Republicans to repeal it.
China says it has largely shut down its rare earth industry for three months to address pollution problems. By invoking environmental concerns, China could potentially try to circumvent international trade rules that are supposed to prohibit export restrictions of vital materials.
In July, the European Union said in a statement on rare earth policy that the organization supported efforts to protect the environment, but that discrimination against foreign buyers of rare earths was not allowed under World Trade Organization rules.
China has been imposing tariffs and quotas on its rare earth exports for several years, curtailing global supplies and forcing prices to rise eightfold to fortyfold during that period for the various 17 rare earth elements.
Even before this latest move by China, the United States and the European Union were preparing to file a case at the W.T.O. this winter that would challenge Chinese export taxes and export quotas on rare earths.
Chinese officials here at the conference said the government was worried about polluted water, polluted air and radioactive residues from the rare earth industry, particularly among many small and private companies, some of which operate without the proper licenses. While rare earths themselves are not radioactive, they are always found in ore containing radioactive thorium and require careful handling and processing to avoid contaminating the environment.
Most of the country’s rare earth factories have been closed since early August, including those under government control, to allow for installation of pollution control equipment that must be in place by Oct. 1, executives and regulators said.
The government is determined to clean up the industry, said Xu Xu, chairman of the China Chamber of Commerce of Metals, Minerals and Chemicals Importers and Exporters, a government-controlled group that oversees the rare earth industry. “The entrepreneurs don’t care about environmental problems, don’t care about labor problems and don’t care about their social responsibility,” he said. “And now we have to educate them.”
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Beijing authorities are creating a single government-controlled monopoly, Bao Gang Rare Earth, to mine and process ore in northern China, the region that accounts for two-thirds of China’s output. The government is ordering 31 mostly private rare earth processing companies to close this year in that region and is forcing four other companies into mergers with Bao Gang, said Li Zhong, the vice general manager of Bao Gang Rare Earth.
The government also plans to consolidate 80 percent of the production from southern China, which produces the rest of China’s rare earths, into three companies within the next year or two, Mr. Li said. All three of these companies are former ministries of the Chinese government that were spun out as corporations, and the central government still owns most of the shares.
The taxes and quotas China had in place to restrict rare earth exports caused many companies to move their factories to China from the United States and Europe so that they could secure a reliable and inexpensive source of raw materials.
China promised when it joined the W.T.O. in 2001 that it would not restrict exports except for a handful of obscure materials. Rare earths were not among the exceptions.
But even if the W.T.O. orders China to dismantle its export tariffs and quotas, the industry consolidation now under way could enable China to retain tight control over exports and continue to put pressure on foreign companies to relocate to China.
The four state-owned companies might limit sales to foreign buyers, a tactic that would be hard to address through the W.T.O., Western trade officials said.
Hedge funds and other speculators have been buying and hoarding rare earths this year, with prices rising particularly quickly through early August, and dipping since then as some have sold their inventories to take profits, said Constantine Karayannopoulos, the chief executive of Neo Material Technologies, a Canadian company that is one of the largest processors in China of raw rare earths.
“The real hot money got into the industry building neodymium and europium inventories in Shanghai warehouses,” he said.
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http://www.washingtonpost.com/wp-dyn/content/article/2008/03/08/AR2008030802595.html
Solar Energy Firms Leave Waste Behind in China
"It's poison air. Sometimes it gets so bad you can't sit outside. You have to close all the doors and windows," says Qiao Shi Peng, 28, shown in front of a dumping site in his village, who worries about his 1-year-old son's health. (Zhang Quanfeng - Photo By Zhang Quanfeng)
At left, cornfields in China's Henan Province died after a green energy firm dumped industrial waste inside a nearby village. The liquid waste evaporated and left white powder. Tests of the soil where the dumping occurred showed high concentrations of chlorine and hydrochloric acid, which do not exist naturally. (Zhang Quanfeng - Photo By Zhang Quanfeng)
By Ariana Eunjung Cha
Washington Post Foreign Service
Sunday, March 9, 2008
GAOLONG, China -- The first time Li Gengxuan saw the dump trucks from the nearby factory pull into his village, he couldn't believe what happened. Stopping between the cornfields and the primary school playground, the workers dumped buckets of bubbling white liquid onto the ground. Then they turned around and drove right back through the gates of their compound without a word.
This ritual has been going on almost every day for nine months, Li and other villagers said.
In China, a country buckling with the breakneck pace of its industrial growth, such stories of environmental pollution are not uncommon. But the Luoyang Zhonggui High-Technology Co., here in the central plains of Henan Province near the Yellow River, stands out for one reason: It's a green energy company, producing polysilicon destined for solar energy panels sold around the world. But the byproduct of polysilicon production -- silicon tetrachloride -- is a highly toxic substance that poses environmental hazards.
"The land where you dump or bury it will be infertile. No grass or trees will grow in the place. . . . It is like dynamite -- it is poisonous, it is polluting. Human beings can never touch it," said Ren Bingyan, a professor at the School of Material Sciences at Hebei Industrial University.
The situation in Li's village points to the environmental trade-offs the world is making as it races to head off a dwindling supply of fossil fuels.
Forests are being cleared to grow biofuels like palm oil, but scientists argue that the disappearance of such huge swaths of forests is contributing to climate change. Hydropower dams are being constructed to replace coal-fired power plants, but they are submerging whole ecosystems under water.
Likewise in China, the push to get into the solar energy market is having unexpected consequences.
With the prices of oil and coal soaring, policymakers around the world are looking at massive solar farms to heat water and generate electricity. For the past four years, however, the world has been suffering from a shortage of polysilicon -- the key component of sunlight-capturing wafers -- driving up prices of solar energy technology and creating a barrier to its adoption.
With the price of polysilicon soaring from $20 per kilogram to $300 per kilogram in the past five years, Chinese companies are eager to fill the gap.
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How to Weaken the Power of Foreign Oil
By ROBERT C. McFARLANE and R. JAMES WOOLSEY
Published: September 20, 2011
OUR country has just gone through a sober national retrospective on the 9/11 attacks. Apart from the heartfelt honoring of those lost — on that day and since — what seemed most striking is our seeming passivity and indifference toward the well from which our enemies draw their political strength and financial power: the strategic importance of oil, which provides the wherewithal for a generational war against us, as we mutter diplomatic niceties.
Oil’s strategic importance stems from its virtual monopoly as a transportation fuel. Today, 97 percent of all air, sea and land transportation systems in the United States have only one option: petroleum-based products. For more than 35 years we have engaged in self-delusion, saying either that we have reserves here at home large enough to meet our needs, or that the OPEC cartel will keep prices affordable out of self-interest. Neither assumption has proved valid. While the Western Hemisphere’s reserves are substantial and growing, they pale in the face of OPEC’s, which are substantial enough to effectively determine global supply and thus the global price.
According to senior executives in the oil industry, in the years ahead that price is going to rise beyond anything we’ve seen — well above the $147 per barrel we experienced three years ago. Such a run-up in the price of oil has been predicted as a consequence of an event like an attack on a major Saudi processing facility that takes production off line. But such a spike would be more likely to be caused by the predictable increase of demand in China, India and developing countries, alongside the cartel’s strategy of driving up prices by constraining supply. While OPEC sits on 79 percent of the world’s conventional oil reserves, it accounts for only one-third of global oil supply.
There is, however, a way out of this crisis. Ultimately, electric cars may become the norm, but for the near and middle term, the solution lies in opening the transportation fuel market to competition from sources other than petroleum. American oil companies have come around to understanding the wisdom of introducing competition, as a matter of their own self-interest. But doing so means rapidly ramping up production of the alternative fuels, and that is the challenge. As an example, before investors will expand production capacity for cellulosic ethanol from plant life, or for methanol from natural gas — which on a per-mile basis is significantly cheaper than gasoline — they want to see that a sufficient proportion of the cars and trucks on America’s roads can burn these fuels.
Here too, however, a solution is at hand; it lies in Detroit’s making more flex-fuel cars — cars able to use gasoline, ethanol, methanol or any mixture of these. And because this flex-fuel option costs less than $100 per car, making such a change is not exorbitant. Indeed, some 90 percent of all cars sold in Brazil last year are flex-fuel cars, and many of them were made by Ford, Chrysler and General Motors. That gives Brazilian drivers the option to purchase the most cost-effective fuel, and they can easily switch from one type to another.
But here’s the rub. Although the American manufacturers have stated publicly their willingness to make flex-fuel vehicles up to 50 percent of their production, they’re just not doing it. Hence the need for Congress to require that new vehicles allow the use of alternative fuels. In some corners of Washington, that raises a cry against “mandates.” Of course the response to that is: Doing nothing is equivalent to mandating a monopoly by a single fuel (whose price is set by a foreign cartel).
Competition is a bedrock of our American way of life. It’s time to introduce it into our fuel market.
That is the purpose of the United States Energy Security Council, a bipartisan group being introduced to the public today in Washington, which includes former Secretary of State George P. Shultz and two former secretaries of defense, William J. Perry and Harold Brown, as well as three former national security advisers, a former C.I.A. director, two former senators, a Nobel laureate, a former Federal Reserve chairman, and several Fortune-50 chief executives (including a former president of Shell Oil North America, John D. Hofmeister).
The time has come to strip oil of its strategic status. We owe it to those who lost their lives on 9/11 and in its aftermath, and to those whose fate still hangs in the balance.
Robert C. McFarlane was the national security adviser from 1983 to 1985. R. James Woolsey, chairman of the Foundation for Defense of Democracies, was the director of the Central Intelligence Agency from 1993 to 1995.
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http://www.npr.org/2011/09/25/140784004/new-boom-reshapes-oil-world-rocks-north-dakota
Global Implications
Amy Myers Jaffe of Rice University says in the next decade, new oil in the US, Canada and South America could change the center of gravity of the entire global energy supply.
"Some are now saying, in five or 10 years' time, we're a major oil-producing region, where our production is going up," she says.
The US, Jaffe says, could have 2 trillion barrels of oil waiting to be drilled. South America could hold another 2 trillion. And Canada? 2.4 trillion. That's compared to just 1.2 trillion in the Middle East and north Africa.
Jaffe says those new oil reserves, combined with growing turmoil in the Middle East, will "absolutely propel more and more investment into the energy resources in the Americas."
Russia is already feeling the growth of American energy, Jaffe says. As the U.S. produces more of its own natural gas, Europe is free to purchase liquefied natural gas the US is no longer buying.
"They're buying less natural gas from Russia," Jaffe says. "So Russia would only supply 10 percent of European natural gas demand by 2030. That means the Russians are no longer powerful."
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That is very, very good news.
Worth noting is that the distinctly higher pollution levels of Canada's shale oil (apart from CO2 emissions IIRC) will present questions. Also presenting questions will be concerns about polluting the water table with fracking:
see c.f.
Industrial solvent TCE even more dangerous to people
EPA finds trichloroethylene causes kidney and liver cancer, lymphoma and other health problems. The decision could raise the cost of cleanups nationwide, including in the San Fernando and San Gabriel valleys.
By Louis Sahagun, Los Angeles Times
September 30, 2011
One of the most widespread groundwater contaminants in the nation is more dangerous to humans than earlier thought, a federal agency has determined, in a decision that could raise the cost of cleanups nationwide, including large areas of the San Fernando and San Gabriel valleys.
The final risk assessment for trichloroethylene by the Environmental Protection Agency found that the widely used industrial solvent causes kidney and liver cancer, lymphoma and other health problems. That lays the groundwork to reevaluate the federal drinking-water standard for the contaminant: 5 parts per billion in water, and 1 microgram per cubic meter in air, officials said.
Paul Anastas, assistant administrator for the EPA's office of research and development, said toxicity values for TCE reported in the risk assessment released this week may be used to establish new cleanup strategies at 761 Superfund sites, as well as in aquifers supplying drinking water to millions of residents in the San Gabriel and San Fernando valleys.
The risk assessment had been subject to more than a decade of delays. A 2001 draft assessment that suggested a strong link between TCE and cancer was opposed by the Defense Department, the Energy Department and NASA.
The Pentagon had demanded greater proof that industrial substances cause cancer before raising cleanup costs at more than 1,000 polluted sites.
"This risk assessment is a big deal because it will strengthen protections for people who live and work above TCE plumes — and there are a lot of them — and could force serious rethinking about the extent of cleanup efforts," said Lenny Siegal, executive director of the Mountain View, Calif.-based Center for Public Environmental Oversight, which posted a letter Monday signed by activists across the country, demanding that the final risk assessment be released. It was released Wednesday.
Jennifer Sass, senior scientist at the Natural Resources Defense Council, said the decision "launches new arguments about what the safety standards should be. In the meantime, people impacted by this pollution can now link their disease to it in litigation with more confidence because the science is no longer in dispute. TCE causes cancer."
TCE has been discovered in nearly every state but in none more widely than California. Military bases including Camp Pendleton and Edwards Air Force Base have Superfund sites with TCE contamination.
The Los Angeles metropolitan area overlies a checkerboard of underground plumes of TCE, and has high ambient levels of the chemical in the air. More than 30 square miles of the San Gabriel Valley lie in one of four Superfund sites that contain TCE. The San Fernando Valley overlies a large plume grouped into three separate Superfund sites. The former Marine Corps Air Station El Toro in Orange County sits over a plume several miles long.
Developed by chemists in the late 19th century, TCE was widely used after World War II to degrease metal and electronic parts, and then dumped into nearby disposal pits and storage tanks at industrial plants and military bases, where it seeped into aquifers.
The public can be exposed to TCE in several ways, including by showering in contaminated water and by breathing air in homes where TCE vapors have intruded from the soil. TCE's movement from contaminated groundwater and soil into the indoor air of overlying buildings is a major concern.
"Vapor intrusion represents toxic exposure which is continuous and difficult to avoid," Siegal said. "It's not like you can live on bottled air in your own home or school."
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That would be very good news indeed if it was true. I'm afraid Ms. Jaffee has neither a masters or Phd. nor is she a petroleum engineer. I think she majored in Arabic or something and only has an undergraduate degree at that.
Yet she does oil analysis. :-o
That said, she is a wonderful spokesperson for oil industry. :-)
In Montana and North Dakota they expect to recover 4.5 billion barrels of oil. There may even be more although it's expense to drill. Not to mention the serious pollution danger.
Still, it's all good news for us, but NOT 2 Trillion. Not even close.
http://en.wikipedia.org/wiki/Oil_reserves_in_the_United_States
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I'm sorry but I never heard what your degree is in. If all learning occurs in accredited grad schools, what are we doing here? The adventure has stopped for a credentials check.
Why would the oil industry want you to think there is more oil in the ground than there is? Tight supplies, shortage panics leading to high prices are what boosted profits. - DM, PhD, Oil Exploration Economics, IU (imaginary University)
While 'debunking' new information, you link bunk. Did you refute and I missed it or did you ignore what I posted in this thread just 2 1/1 weeks ago:
http://dogbrothers.com/phpBB2/index.php?topic=1096.msg54184#msg54184
"In Saudi Arabia, for example, “proven oil reserves” are whatever the government announces they are.
But in the United States, “proven oil reserves” is a legal term, not a scientific term. It is defined by the Securities and Exchange Commission. We wrote about this in detail in Obama’s Long Nose On Energy. This is the definition, unique to United States law, of “proven oil reserves:”
Proved reserves. The quantities of hydrocarbons estimated with reasonable certainty to be commercially recoverable from known accumulations under current economic conditions, operating methods, and government regulations. Current economic conditions include prices and costs prevailing at the time of the estimate. Estimates of proved reserves do not include reserves appreciation."
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Doug, my degree in in Economics :-o Scary huh? :-)
Yet, I don't put myself out to the public as an expert. My former boat partner has a Phd in Econometrics from Berkeley. He does put himself out as
an expert. And yes, I do think a credential check is appropriate if in the public you are putting yourself out as an "expert" as Ms. Jaffee is doing.
I read your post. No offense, but a biased blogger hardly "debunks" the information I provided.
But here is what your post said;
" In a recent report, CRS [the Congressional Research Service] said that the U.S. has 19.1 billion barrels of proven reserves, which is the number President Obama cites as 2% of the world’s oil. CRS, however, showed that between our proven reserves and oil predicted to be found, there is likely to be a combined 164.1 billion barrels, or 8.5 times as much as the president alleges. And this figure doesn’t include oil shale, which has recoverable reserves of 1 trillion barrels, according to DOE.
http://www.powerlineblog.com/archives/2011/03/028574.php"
Let's accept that for discussion purposes. But Ms. Jaffe says 2 Trillion! Where did she get that number? Out of a hat? I think we are seeking the truth here, not fantasy.
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By LUCIAN PUGLIARESI
In response to a 2009 request from Secretary of Energy Steven Chu, the National Petroleum Council (NPC) reported earlier this month that oil production in North America could double by 2035—to 20 million barrels per day.
Where can all this oil come from? For one, the hydraulic fracturing (fracking) technique used in shale gas production is now being applied to extract oil. The vast oil reserves in Canada's Alberta Province are increasingly being tapped. There is more oil to be had with greater access to federal lands in Alaska and the western U.S., and accelerated drilling in the deep waters in the Gulf of Mexico.
But to realize the enormous potential outlined in the NPC report, we need to understand how the policies of the federal government act as a serious brake on access to the reserves and the exploitation of new technologies to tap them.
The shale gas revolution started in Texas, migrated quickly to Arkansas, Oklahoma, Virginia, West Virginia and Pennsylvania and then leaped to North Dakota—where the technology for producing shale gas was applied to oil development. Even New York Gov. Andrew Cuomo, no longer wishing to miss out on the economic opportunity for his state, has pulled back from his state's comprehensive ban on hydraulic fracturing and horizontal drilling for shale gas.
What do these states all have in common besides interesting geology? Their federal land holdings are extremely small and mineral rights are in private hands.
Thus landowners were not prohibited from coming to terms with oil and gas companies, providing immediate opportunities to test new drilling technologies. Knowledge gained in one region could move quickly to another. Regulatory and environmental reviews were largely the responsibilities of state and local governments, and disagreements could often be resolved at the local level.
Contrast the shale gas revolution to oil and gas development on the vast lands owned by the federal government. There access to reserves is burdened by endless federal environmental reviews, congressional oversight, permitting delays and bureaucrats who insist that oil and gas resources do not exist in areas of interest to oil and gas companies.
Shell Oil, the winning bidder on a federal lease sale in Alaska, has spent over four years and billions of dollars and is only now getting the final permits to proceed with exploratory drilling in the Arctic Ocean's Beaufort Sea. Further court challenges remain likely.
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Workers in the middle of natural gas drilling operations for Chesapeake Energy Corp. in Bradford County, Penn.
.Shell USA President Marvin Odum has stated that his board members in The Hague (Shell USA is a subsidiary of Royal Dutch Shell) are now raising serious concerns over political and regulatory risk attached to investment in the United States. Court challenges over the adequacy of environmental reviews, as well as other interventions not permitted on private lands, make the process of bringing new oil and gas production from federal lands to market both slow and costly.
President Obama's criticism of the federal oil and gas leasing program, and his call for "use it or lose it" when referring to undeveloped leases on federal lands, are the exact opposite of what is needed. We need to open more lands and minimize the regulatory burden to ensure that the oil and gas potential outlined by the NPC can be realized.
Those proponents of "peak oil" who claim the NPC report is unrealistic need only revisit our recent history with shale gas. Natural gas production has surged by more than 25% in the last four years. Yet just a few years ago, government reports and long hours of expert testimony on Capitol Hill outlined the need for the U.S. to take action to address a growing shortage of natural gas.
A crash program was called for to build receiving facilities to import foreign supplies of liquefied natural gas (LNG). Many receiving facilities were built at a cost of billions of dollars as investors bought into the government assessments. Today these facilities are operating at less than 10% capacity.
Ample supplies of oil and gas, combined with taxpayer fatigue over green subsidies, means that a range of costly and uncompetitive technologies such as biofuels and electric cars now face the prospect of financial failure. To be sure, investments in the oil and gas industry are not immune from surprises and technology advances. LNG receiving facilities in the U.S. are suffering large financial losses. The good news is that unlike the bankrupt Solyndra solar plant that received over $500 million in federal loans, losses at the LNG receiving facilities will not be picked up by the taxpayers.
Mr. Pugliaresi is president of the Energy Policy Research Foundation and a former staff member of the National Security Council under President Reagan.
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in the United States, “proven oil reserves” is a legal term, not a scientific term. It is defined by the Securities and Exchange Commission
The information you dispute links back to the SEC, FYI.
Biased blogger? Please give one example of an uncorrected falsehood posted the person whose integrity you attack.
If a "biased blogger brought you that correction of widely dispersed bunk, (actually I brought it to you) you should thank him rather than post and link further falsehoods put out by swarms of highly credentialed.
I recall that Dan Rather took on the same biased blogger over accuracy and bias and lost.
You commented quantitatively on the amount of reserves but failed your own credentials check. Please retract.
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:? :? :?
So I'm not suppose to believe reports from "swarms of highly credentialed" petroleum engineers, but I am suppose to believe your favorite Blogger?
Ok.
Did you read your post from your Blogger? Did you read the numbers he quoted?
No matter how you do the math, it doesn't equal Ms. Jaffee's 2 Trillion+ barrels of oil.
If you are interested in the credentialed experts:
http://en.wikipedia.org/wiki/Oil_reserves
And yes, these are BP Petroleum Engineers doing the study not Bloggers who post on everything from articles on gay rights, the middle east, politics and cookies. And oil reserves.
Really, you don't like credentialed experts (petroleum engineers) but like biased Bloggers? Do you know how many armchair Bloggers there are? How easy it is to find
and quote a Blogger who agrees with you? Whatever the subject. Sorry, credentials DO matter.
What am I suppose to retract? That Ms. Jaffee is blowing smoke?
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JDN, The expert you dismiss is NPR's energy expert, NPR is hardly an oil industry mouthpiece and what she says doesn't favor or oppose the oil industry in any way. She is the same one they have turned to for years including during last year's oil spill crisis. She is head of the Energy Forum and the James A. Baker Institute for Public Policy Energy Forum at Rice University in Houston, apparently a place that doesn't check credentials. All she was giving was an opinion and an ESTIMATE of something that can't be known for certain. Post the opinion of a different expert if you want but, instead you aim to bring down the discussion and learning, shoot the messenger, insult me, name call my sources and misread my posts. I wasn't even the original poster. You ignore my challenge to tell me where the people you dismiss as biased bloggers let bias interfere with facts. you could show me where they were wrong just once in all their disputes with CBS, NY Times and others. Instead just more insults and repetition. You dismiss what is already posted without acknowledging it or refuting it and repeat back what was already shown to be false. For me that is too many times that you brought down the discussion (what additional information has been added regarding the boom in Williston? none) and spoil the fun of participating here. - Doug
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By STEPHEN MOORE
Harold Hamm, the Oklahoma-based founder and CEO of Continental Resources, the 14th-largest oil company in America, is a man who thinks big. He came to Washington last month to spread a needed message of economic optimism: With the right set of national energy policies, the United States could be "completely energy independent by the end of the decade. We can be the Saudi Arabia of oil and natural gas in the 21st century."
"President Obama is riding the wrong horse on energy," he adds. We can't come anywhere near the scale of energy production to achieve energy independence by pouring tax dollars into "green energy" sources like wind and solar, he argues. It has to come from oil and gas.
You'd expect an oilman to make the "drill, baby, drill" pitch. But since 2005 America truly has been in the midst of a revolution in oil and natural gas, which is the nation's fastest-growing manufacturing sector. No one is more responsible for that resurgence than Mr. Hamm. He was the original discoverer of the gigantic and prolific Bakken oil fields of Montana and North Dakota that have already helped move the U.S. into third place among world oil producers.
How much oil does Bakken have? The official estimate of the U.S. Geological Survey a few years ago was between four and five billion barrels. Mr. Hamm disagrees: "No way. We estimate that the entire field, fully developed, in Bakken is 24 billion barrels."
If he's right, that'll double America's proven oil reserves. "Bakken is almost twice as big as the oil reserve in Prudhoe Bay, Alaska," he continues. According to Department of Energy data, North Dakota is on pace to surpass California in oil production in the next few years. Mr. Hamm explains over lunch in Washington, D.C., that the more his company drills, the more oil it finds. Continental Resources has seen its "proved reserves" of oil and natural gas (mostly in North Dakota) skyrocket to 421 million barrels this summer from 118 million barrels in 2006.
"We expect our reserves and production to triple over the next five years." And for those who think this oil find is only making Mr. Hamm rich, he notes that today in America "there are 10 million royalty owners across the country" who receive payments for the oil drilled on their land. "The wealth is being widely shared."
One reason for the renaissance has been OPEC's erosion of market power. "For nearly 50 years in this country nobody looked for oil here and drilling was in steady decline. Every time the domestic industry picked itself up, the Saudis would open the taps and drown us with cheap oil," he recalls. "They had unlimited production capacity, and company after company would go bust."
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.Today OPEC's market share is falling and no longer dictates the world price. This is huge, Mr. Hamm says. "Finally we have an opportunity to go out and explore for oil and drill without fear of price collapse." When OPEC was at its peak in the 1990s, the U.S. imported about two-thirds of its oil. Now we import less than half of it, and about 40% of what we do import comes from Mexico and Canada. That's why Mr. Hamm thinks North America can achieve oil independence.
The other reason for America's abundant supply of oil and natural gas has been the development of new drilling techniques. "Horizontal drilling" allows rigs to reach two miles into the ground and then spread horizontally by thousands of feet. Mr. Hamm was one of the pioneers of this method in the 1990s, and it has done for the oil industry what hydraulic fracturing has done for natural gas drilling in places like the Marcellus Shale in the Northeast. Both innovations have unlocked decades worth of new sources of domestic fossil fuels that previously couldn't be extracted at affordable cost.
Mr. Hamm's rags to riches success is the quintessential "only in America" story. He was the last of 13 kids, growing up in rural Oklahoma "the son of sharecroppers who never owned land." He didn't have money to go to college, so as a teenager he went to work in the oil fields and developed a passion. "I always wanted to find oil. It was always an irresistible calling."
He became a wildcat driller and his success rate became legendary in the industry. "People started to say I have ESP," he remarks. "I was fortunate, I guess. Next year it will be 45 years in the business."
Mr. Hamm ranks 33rd on the Forbes wealth list for America, but given the massive amount of oil that he owns, much still in the ground, and the dizzying growth of Continental's output and profits (up 34% last year alone), his wealth could rise above $20 billion and he could soon be rubbing elbows with the likes of Warren Buffett.
His only beef these days is with Washington. Mr. Hamm was invited to the White House for a "giving summit" with wealthy Americans who have pledged to donate at least half their wealth to charity. (He's given tens of millions of dollars already to schools like Oklahoma State and for diabetes research.) "Bill Gates, Warren Buffett, they were all there," he recalls.
When it was Mr. Hamm's turn to talk briefly with President Obama, "I told him of the revolution in the oil and gas industry and how we have the capacity to produce enough oil to enable America to replace OPEC. I wanted to make sure he knew about this."
The president's reaction? "He turned to me and said, 'Oil and gas will be important for the next few years. But we need to go on to green and alternative energy. [Energy] Secretary [Steven] Chu has assured me that within five years, we can have a battery developed that will make a car with the equivalent of 130 miles per gallon.'" Mr. Hamm holds his head in his hands and says, "Even if you believed that, why would you want to stop oil and gas development? It was pretty disappointing."
Washington keeps "sticking a regulatory boot at our necks and then turns around and asks: 'Why aren't you creating more jobs,'" he says. He roils at the Interior Department delays of months and sometimes years to get permits for drilling. "These delays kill projects," he says. Even the Securities and Exchange Commission is now tightening the screws on the oil industry, requiring companies like Continental to report their production and federal royalties on thousands of individual leases under the Sarbanes-Oxley accounting rules. "I could go to jail because a local operator misreported the production in the field," he says.
The White House proposal to raise $40 billion of taxes on oil and gas—by excluding those industries from credits that go to all domestic manufacturers—is also a major hindrance to exploration and drilling. "That just stops the drilling," Mr. Hamm believes. "I've seen these things come about before, like [Jimmy] Carter's windfall profits tax." He says America's rig count on active wells went from 4,500 to less than 55 in a matter of months. "That was a dumb idea. Thank God, Reagan got rid of that."
A few months ago the Obama Justice Department brought charges against Continental and six other oil companies in North Dakota for causing the death of 28 migratory birds, in violation of the Migratory Bird Act. Continental's crime was killing one bird "the size of a sparrow" in its oil pits. The charges carry criminal penalties of up to six months in jail. "It's not even a rare bird. There're jillions of them," he explains. He says that "people in North Dakota are really outraged by these legal actions," which he views as "completely discriminatory" because the feds have rarely if ever prosecuted the Obama administration's beloved wind industry, which kills hundreds of thousands of birds each year.
Continental pleaded not guilty to the charges last week in federal court. For Mr. Hamm the whole incident is tantamount to harassment. "This shouldn't happen in America," he says. To him the case is further proof that Washington "is out to get us."
Mr. Hamm believes that if Mr. Obama truly wants more job creation, he should study North Dakota, the state with the lowest unemployment rate in the nation at 3.5%. He swears that number is overstated: "We can't find any unemployed people up there. The state has 18,000 unfilled jobs," Mr. Hamm insists. "And these are jobs that pay $60,000 to $80,000 a year." The economy is expanding so fast that North Dakota has a housing shortage. Thanks to the oil boom—Continental pays more than $50 million in state taxes a year—the state has a budget surplus and is considering ending income and property taxes.
It's hard to disagree with Mr. Hamm's assessment that Barack Obama has the energy story in America wrong. The government floods green energy—a niche market that supplies 2.5% of our energy needs—with billions of dollars of subsidies a year. "Wind isn't commercially feasible with natural gas prices below $6" per thousand cubic feet, notes Mr. Hamm. Right now its price is below $4. This may explain the administration's hostility to the fossil-fuel renaissance.
Mr. Hamm calculates that if Washington would allow more drilling permits for oil and natural gas on federal lands and federal waters, "I truly believe the federal government could over time raise $18 trillion in royalties." That's more than the U.S. national debt, I say. He smiles.
This estimate sounds implausibly high, but Mr. Hamm has a lifelong habit of proving skeptics wrong. And even if he's wrong by half, it's a stunning number to think about. So this America-first energy story isn't just about jobs and economic revival. It's also about repairing America's battered balance sheet. Someone should get this man in front of the congressional deficit-reduction supercommittee.
Mr. Moore is a member of the Journal's editorial board.
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JDN, The expert you dismiss is NPR's energy expert, NPR is hardly an oil industry mouthpiece and what she says doesn't favor or oppose the oil industry in any way. She is the same one they have turned to for years including during last year's oil spill crisis. She is head of the Energy Forum and the James A. Baker Institute for Public Policy Energy Forum at Rice University in Houston, apparently a place that doesn't check credentials. All she was giving was an opinion and an ESTIMATE of something that can't be known for certain. Post the opinion of a different expert if you want but, instead you aim to bring down the discussion and learning, shoot the messenger, insult me, name call my sources and misread my posts. I wasn't even the original poster. You ignore my challenge to tell me where the people you dismiss as biased bloggers let bias interfere with facts. you could show me where they were wrong just once in all their disputes with CBS, NY Times and others. Instead just more insults and repetition. You dismiss what is already posted without acknowledging it or refuting it and repeat back what was already shown to be false. For me that is too many times that you brought down the discussion (what additional information has been added regarding the boom in Williston? none) and spoil the fun of participating here. - Doug
Doug, I truly don't think I insulted you. If you were insulted I apologize.
The NPR "expert" is a spokesperson for the oil industry. That's like saying Jay Carney is an "expert".
I disagreed with her (GM's Post) because the numbers were absurd with no relationship to reality. Now if they had been posted in the comics I understand, but they were posted here to represent truth.
Harold Hamm, in comments below, although biased, is brilliant and qualified. He thinks, just his opinion, that there may be 24 billion barrels in Bakken. Well, maybe he is right, but do you know how many more barrels you need to reach Ms. Jaffee's number of 2 Trillion?
Im not trying to repeat myself although sometimes it's necessary. And I surely did not repeat false information. I did twice post the estimates of BP done by their credentialed petroleum engineers. Frankly,
I think credentials do matter. If you are going to be an "expert witness" I want to see your qualifications before I will give credence to your opinion. That can be your personal opinion, for example I give
credence to GM when he speaks of police matters; while I may not always agree with him :-) I know he is speaking with knowledge on the subject. You have knowledge of real estate for example. CCP medical. And others. Or it can be a quoted expert with the source being identified. Or it can just be a personal opinion; nothing wrong with that either, but it's not equal to a credible expert.
I do in general dismiss bloggers until the original source is checked. I apply this rule to both right and left. Bloggers in general are hucksters selling their product, not necessarily the truth. It simply
is not credible research to merely quote bloggers or if you do, it's merely to bring attention to an idea, but please don't present it as fact until verified.
If too many times I brought down the discussion, well, if bringing down the discussion means showing another point of view, than maybe you are right. As you say, maybe I am a centrist. I sincerely believe
both the right and the left sometimes make good points. When the pendulum swings too far one way (Obama) that is not good. Equally scary to me is when the pendulum swings too far to the right
as it has a tendency to do on this forum. I think you long for the days of the robber barons. I respectfully disagree and express my viewpoint. Hopefully, someone can read this forum, read both
sides and make their own informed decision.
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By VAUHINI VARA
While Solyndra LLC's flameout has fueled criticism of federal initiatives to encourage alternative power sources, the solar-panel maker is hardly the only disappointment among U.S.-backed energy programs.
That's evident in California, which was awarded $4.6 billion by the Energy Department as part of the 2009 Recovery Act—far more than any other state—to fund programs in energy efficiency and other areas.
A program to install insulation and other energy-saving improvements in homes that received $185.8 million has been hobbled by delays, and a plan to remodel buildings to be more energy-efficient, which received $113 million, has struggled to persuade enough home and building owners to upgrade, according to California officials.
Meanwhile, $15 million went to train workers in skills such as solar-panel installation, but 62% of that program's alumni remain jobless, according to the state Employment Development Department. Solyndra, which declared bankruptcy in August and is now embroiled in a criminal investigation over whether it defrauded the federal government, got $535 million, nearly 12% of California's total under the energy program.
What all of these programs have in common is that they tried to scale up very quickly in the midst of regulatory uncertainty and a sluggish economic recovery that hurt demand for energy-efficient products, said Mark Muro, a senior fellow at the Brookings Institution. Such factors "definitely negatively affected" some of California's clean-energy programs, said Panama Bartholomy, a deputy director at the California Clean Energy Commission.
California's experience isn't unusual, and some states have fared worse. The Energy Department found in August and September that the building-weatherization programs it helped fund in Missouri and Tennessee had quality problems and other issues that it said "could pose health and safety risks to residents, hinder production, and increase program costs."
Enlarge Image
Close.Jen Stutsman, a spokeswoman for the Energy Department, said the 2009 Recovery Act "helped to create tens of thousands of clean-energy jobs in California and across the country."
Other investments in California appear to be more successful. BrightSource Energy Inc., which received a $1.6 billion loan guarantee, says it remains on track to build a project expected to nearly double the amount of solar-thermal energy in the U.S. and create 1,400 jobs. An $18.8 million EnergySmart Jobs program, which trains people to install electricity-saving features in grocery stores while giving rebates to those stores for their investment, has resulted in 2,070 upgrades. Jerry McLaughlin, vice president of operations at Spencer's Fresh Markets, a small California grocery chain, said an energy monitor installed under the program in one store's freezers should save $500 to $900 a month.
The Energy Department handed out $35.2 billion from the Recovery Act for energy efficiency and other initiatives. At the time, clean energy was seen as a potentially powerful industry for job creation.
But the industry has yet to provide the boost many had hoped for. Nationwide, jobs related to energy efficiency rose to 2.7 million people last year, up 27% from 2003, compared with overall job growth of 33%, according to the Brookings Institution. The figures exclude jobs lost because of establishments closing.
In California, the weatherization program ran into challenges because of a federal government delay in issuing prevailing-wage rates for the workers involved and inexperience of those administering the program. In July, state auditor Elaine Howle wrote that the program "faces challenges" in weatherizing enough homes by a deadline next year.
Rachel Arrezola, a spokeswoman for California's Department of Community Services, said the program is on track to use all but $18 million to $22 million of the total $185.8 million in funds. As of Sept. 30, California had weatherized nearly 37,000 homes and expects to reach its target of 43,150 homes before the program ends.
Meanwhile, the program to remodel houses and commercial buildings to use energy more efficiently was hurt after the Federal Housing Finance Agency warned in 2010 of "significant safety and soundness concerns" over a financing method the program planned to use, said the California Energy Commission. While the program had hoped to upgrade 15,000 buildings, only 6,342 are finished or in progress.
The sluggishness of the overall economy and slow adoptions of energy upgrades also have hurt training program for clean-energy workers, which combined recovery funds with state money to train 4,719 people in skills such as building energy-efficient houses since January 2010. Of the 2,931 who exited the program as of mid-September, only 1,104 found work, according to the state Employment Development Department.
Among those who remain unemployed is Jim Criscione. The 61-year-old, who lives near San Francisco, worked in construction for decades before he was let go in late 2009. In January, he signed up for free classes to learn skills such as installing solar panels.
But after Mr. Criscione finished his classes and applied for work, he struck out repeatedly. With unemployment benefits set to expire, he wonders if his time was wasted. "I'm down to almost anything to make a living," he said.
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Update: Fisker Karma Electric Car Gets Worse Mileage Than an SUV
73 comments, 28 called-out + Comment now
Electric Car for the 1%. Image via Wikipedia
The Fisker Karma electric car, developed mainly with your tax money so that a bunch of rich VC’s wouldn’t have to risk any real money, has rolled out with an nominal EPA MPGe of 52 in all electric mode (we will ignore the gasoline engine for this analysis).
Not bad? Unfortunately, it’s a sham. This figure is calculated using the grossly flawed EPA process that substantially underestimates the amount of fossil fuels required to power the electric car, as I showed in great depth in an earlier Forbes.com article. In short, the EPA methodology leaves out, among other things, the conversion efficiency in generating the electricity from fossil fuels in the first place [by assuming perfect conversion of the potential energy in the fuel to electricity, the EPA is actually breaking the 2nd law of thermodynamics].
In the Clinton administration, the Department of Energy (DOE) created a far superior well to wheels MPGe metric that honestly compares the typical fossil fuel use of an electric vs. gasoline car, using real-world power plant efficiencies and fuel mixes to figure out how much fuel is used to produce the electricity that goes into the electric car.
As I calculated in my earlier Forbes article, one needs to multiply the EPA MPGe by .365 to get a number that truly compares fossil fuel use of an electric car with a traditional gasoline engine car on an apples to apples basis. In the case of the Fisker Karma, we get a true MPGe of 19. This makes it worse than even the city rating of a Ford Explorer SUV.
Congrats to the Fisker Karma, which now joins corn ethanol in the ranks of heavily subsidized supposedly green technologies that are actually worse for the environment than current solutions.
Postscript: I will say, though, that the Fisker Karma does serve a social purpose — Hollywood celebrities and the ultra rich, who want to display their green credentials, no longer have to be stuck with a little econobox. They can now enjoy a little leg room and luxury.
Updates: Just to clarify, given some email I have gotten. Most other publications have focused on the 20 mpg the EPA gives the Karma on its backup gasoline engine (example), but my focus is on just how bad the car is even in all electric mode. The calculation in the above article only applies to the car running on electric, and the reduction in MPGe I discuss is from applying the more comprehensive DOE methodology for getting an MPG equivalent, not from some sort of averaging with gasoline mode. Again, see this article if you don’t understand the issue with the EPA methodology.
Press responses from Fisker Automotive highlight the problem here: electric vehicle makers want to pretend that the electricity to charge the car comes from magic sparkle ponies sprinkling pixie dust rather than burning fossil fuels. Take this quote, for example:
a Karma driver with a 40-mile commute who starts each day with a full battery charge will only need to visit the gas station about every 1,000 miles and would use just 9 gallons of gasoline per month.
This is true as far as it goes, but glosses over the fact that someone is still pouring fossil fuels into a tank somewhere to make that electricity. This seems more a car to hide the fact that fossil fuels are being burned than one designed to actually reduce fossil fuel use. Given the marketing pitch here that relies on the unseen vs. the seen, maybe we should rename it the Fisker Bastiat.
Update #2: I suppose it is too late for this plea, commenters who wish to hypothesize on methodological flaws are highly encouraged to read the original linked post explaining the math. For example, a number of folks have suggested I missed the fact that refining takes substantial energy as well. In fact, the DOE methodology used doesn’t just penalize electric cars for combustion inefficiencies in the power plant, it also penalizes gasoline cars for the energy in gasoline refining and transportation.
Update #3: Here is a special bonus, Ray Lane, Chairman of Fisker Automotive, did an interview in 2009 praising the Obama Administration as the first time he has seen government successfully making private investments. His one example: Solyndra!
http://www.forbes.com/sites/warrenmeyer/2011/10/20/update-fisker-karma-electric-car-gets-worse-mileage-than-an-suv/
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I'm going Energy Politics here but equally interesting is the Media Issues aspect. You wouldn't know from the piece that it is his own paper, the NY Times, leading the charge against Fracking, claiming without evidence that it is jeopardizing our clean water supply. I have twice posted statements from the state regulatory agencies in all major energy producing states denying any known incidences of any drinking water contamination from fracking in their state. There have been no firings or impeachments of officials who put out those statements. Low cost, clean, safe, abundantly available, domestic natural gas could contribute to the solutions to whole lot of problems we face today, such as heating our homes, powering transportation, lowering the cost of doing business, reducing the trade deficit, lowering the budget deficit, raising our standard of living, even lowering the demand and cost of oil and other energy sources. But why bother...
http://www.nytimes.com/2011/11/04/opinion/brooks-the-shale-gas-revolution.html?_r=1&partner=rssnyt&emc=rss
Op-Ed Columnist
Shale Gas Revolution
By DAVID BROOKS
Published: November 3, 2011
The United States is a country that has received many blessings, and once upon a time you could assume that Americans would come together to take advantage of them. But you can no longer make that assumption. The country is more divided and more clogged by special interests. Now we groan to absorb even the most wondrous gifts.
A few years ago, a business genius named George P. Mitchell helped offer such a gift. As Daniel Yergin writes in “The Quest,” his gripping history of energy innovation, Mitchell fought through waves of skepticism and opposition to extract natural gas from shale. The method he and his team used to release the trapped gas, called fracking, has paid off in the most immense way. In 2000, shale gas represented just 1 percent of American natural gas supplies. Today, it is 30 percent and rising.
John Rowe, the chief executive of the utility Exelon, which derives almost all its power from nuclear plants, says that shale gas is one of the most important energy revolutions of his lifetime. It’s a cliché word, Yergin told me, but the fracking innovation is game-changing. It transforms the energy marketplace.
The U.S. now seems to possess a 100-year supply of natural gas, which is the cleanest of the fossil fuels. This cleaner, cheaper energy source is already replacing dirtier coal-fired plants. It could serve as the ideal bridge, Amy Jaffe of Rice University says, until renewable sources like wind and solar mature.
Already shale gas has produced more than half a million new jobs, not only in traditional areas like Texas but also in economically wounded places like western Pennsylvania and, soon, Ohio. If current trends continue, there are hundreds of thousands of new jobs to come.
Chemical companies rely heavily on natural gas, and the abundance of this new source has induced companies like Dow Chemical to invest in the U.S. rather than abroad. The French company Vallourec is building a $650 million plant in Youngstown, Ohio, to make steel tubes for the wells. States like Pennsylvania, Ohio and New York will reap billions in additional revenue. Consumers also benefit. Today, natural gas prices are less than half of what they were three years ago, lowering electricity prices. Meanwhile, America is less reliant on foreign suppliers.
All of this is tremendously good news, but, of course, nothing is that simple. The U.S. is polarized between “drill, baby, drill” conservatives, who seem suspicious of most regulation, and some environmentalists, who seem to regard fossil fuels as morally corrupt and imagine we can switch to wind and solar overnight.
The shale gas revolution challenges the coal industry, renders new nuclear plants uneconomic and changes the economics for the renewable energy companies, which are now much further from viability. So forces have gathered against shale gas, with predictable results.
The clashes between the industry and the environmentalists are now becoming brutal and totalistic, dehumanizing each side. Not-in-my-backyard activists are organizing to prevent exploration. Environmentalists and their publicists wax apocalyptic.
Like every energy source, fracking has its dangers. The process involves injecting large amounts of water and chemicals deep underground. If done right, this should not contaminate freshwater supplies, but rogue companies have screwed up and there have been instances of contamination.
The wells, which are sometimes beneath residential areas, are serviced by big trucks that damage the roads and alter the atmosphere in neighborhoods. A few sloppy companies could discredit the whole sector.
These problems are real, but not insurmountable. An exhaustive study from the Massachusetts Institute of Technology concluded, “With 20,000 shale wells drilled in the last 10 years, the environmental record of shale-gas development is for the most part a good one.” In other words, the inherent risks can be managed if there is a reasonable regulatory regime, and if the general public has a balanced and realistic sense of the costs and benefits.
This kind of balance is exactly what our political system doesn’t deliver. So far, the Obama administration has done a good job of trying to promote fracking while investigating the downsides. But the general public seems to be largely uninterested in the breakthrough (even though it could have a major impact on the 21st-century economy). The discussion is dominated by vested interests and the extremes. It’s becoming another weapon in the political wars, with Republicans swinging behind fracking and Democrats being pressured to come out against. Especially in the Northeast, the gas companies are demonized as Satan in corporate form.
A few weeks ago, I sat around with John Rowe, one of the most trusted people in the energy business, and listened to him talk enthusiastically about this windfall. He has no vested interest in this; indeed, his company might be hurt. But he knows how much shale gas could mean to America. It would be a crime if we squandered this blessing.
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I actually support alternative energy ideas, but this is ridiculous; it's simply not right.
http://www.thedailybeast.com/newsweek/2011/11/13/how-obama-s-alternative-energy-programs-became-green-graft.html
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I actually support alternative energy ideas, but this is ridiculous; it's simply not right.
http://www.thedailybeast.com/newsweek/2011/11/13/how-obama-s-alternative-energy-programs-became-green-graft.html
The only green in "green jobs" is taxpayer money funneled off to dem donors through Chicago-style graft.
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http://online.wsj.com/article/SB10001424052970204190504577037754000084544.html?mod=WSJ_Opinion_LEFTTopOpinion
NOVEMBER 16, 2011
The Keystone Debacle
Was Obama's decision to delay the Canadian oil pipeline shrewd politics? Maybe not.
By LUCIAN PUGLIARESI
The U.S. decision to allow the Keystone XL pipeline to go forward should have been easy.
The pipeline would mean at least 20,000 new construction jobs. It would provide lower cost and reliable shipping opportunities for surging North Dakota oil production. Shipping petroleum from Canada's oil sands to the Gulf of Mexico means refiners there would gain a ready replacement for declining supplies of Mexican and Venezuelan crude. Most importantly, it would reinforce expectations that massive and long-term North American infrastructure investments could proceed free of political risk.
And yet the Obama administration's decision to delay the project, despite already extensive and positive environmental review, puts all this in jeopardy.
Both Canada and the United States benefit from highly integrated energy and investment flows. Keystone XL's owner, TransCanada, has already spent more than $2 billion for steel and related facilities. All previous cross-border pipeline requests have been granted, and the U.S. imports over 2.5 million barrels per day of Canadian crude oil and petroleum products. U.S. refiners also ship large volumes of petroleum products to Eastern Canada, taking advantage of geographic transportation efficiencies.
Under the North American Free Trade Agreement (Nafta), no permits are required for shipment of Canadian crude to U.S. destinations by either rail, ocean tanker, or even incremental volumes through existing cross-border pipelines. The creation of a stable investment regime was central to the treaty, and U.S. negotiators successfully argued against reluctant Canadian negotiators that U.S. companies be given full national treatment when investing in Canada.
For Canadians, it was unthinkable that a U.S. president would pull the plug after extensive reviews and 57 project-specific requirements exceeding all U.S. pipeline safety standards, including satellite-linked, computerized leak-detection systems and puncture-resistant steel pipe. Even one of TransCanada's competitors, Enbridge, which ships Canadian crude through existing cross-border pipelines, supported the Keystone permit: Any interruption in the historic bilateral energy trade relationship was a more serious threat to its business than crude shipments by competitors.
The decision to delay the project is such a shift in expectations on the future of U.S.-Canadian energy trade that perhaps the only surprising outcome is that Prime Minister Stephen Harper has not recalled his ambassador. He did announce that shipping the crude to Asia will now receive the highest priority.
A decision to proceed with the pipeline would have sent a strong signal to the world petroleum market (including OPEC) that North America is putting into place a long-term and sustained strategy for expanding domestic oil supplies. True, the administration has stated that it is not denying the cross-border permit, but merely addressing the concerns of Nebraska Republicans who seek an alternative route. Nevertheless, the heavy pressure exerted on the administration by its environmentalist followers was obvious and very public. And in the best of circumstances, federal environmental review of a new route may take over a year.
We are in the early stages of sustained and large increases in domestic crude oil output from the same hydraulic fracturing technology that brought us the shale gas revolution. New crude supplies, combined with the current surge in natural gas production, offer the promise of a renaissance in long-moribund petrochemical processing and petroleum refining industries. The capital now sitting on the sidelines is ready to come off the bench and fund profitable projects. But it will not be deployed if there's a political risk that cannot be contained.
Should we then at least give Mr. Obama credit for a shrewd political strategy? The decision to punt on the project may indeed energize the president's environmental base for the November 2012 presidential election. But that's not the only political effect it could have.
Consider the crucial swing state of Ohio. The Buckeye State's vast Utica oil shale deposit, which now has well over one million acres under lease to companies such as Chesapeake, Hess and Devon, is likely to see some positive results in crude oil production over the next 12 months. On the eve of the presidential election, we may very well be in the early stages of an Ohio oil boom and the promise of coming prosperity.
Which candidate can make the promise that this opportunity will not be brought to a halt by the vast array of job-killing federal agencies? The one who visibly shut down the Keystone XL pipeline and remains engaged in promoting federal initiatives to curtail domestic oil and gas production, or his Republican opponent?
Mr. Pugliaresi is president of the Energy Policy Research Foundation.
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There is a revolution going on America. But it is not part of the Tea Party or the loud Occupy Wall Street protests.
Instead, massive new reserves of gas, oil and coal are being discovered almost everywhere in the United States, due to revolutionary methods of exploration and exploitation such as fracking and horizontal drilling. Current prices of over $100 a barrel make even complex efforts at recovery enormously profitable.
There were always known to be additional untapped reserves of oil and gas in the petroleum-rich Gulf of Mexico, off America's shores, and in the American West and Alaska. But even the top energy experts never imagined just how vast was the energy there -- or beneath far more unlikely places like South Dakota, Pennsylvania, Ohio and New York. Some studies suggest the United States has now expanded its known potential gas and oil reserves tenfold.
The strategic and economic repercussions of these new finds are staggering, and remind us how a once energy-independent and thereby confident American economy soared to world dominance in the early 20th century.
America will soon again be able to supply all of its own domestic natural gas needs -- and perhaps for the next 90 years at present rates of consumption. We have recently become a net exporter of refined gas and diesel fuel, and already have cut imported oil from OPEC countries by 1 million barrels per day.
With expanded exploration and conservation, the United States could also eventually supply half its own petroleum needs. If we were to eliminate just 5 million barrels of our current daily 9 million barrels of imported petroleum, the annual savings could reach nearly $200 billion per year. Eventually, the new gas and oil could add another 1.6 million new jobs and add up to nearly $1 trillion in federal revenue.
That windfall would cut out about a third of our present annual trade deficit -- well apart from additional income earned by new natural gas exportation. "Investments," "shovel-ready jobs" and "stimulus" would finally become more than empty sloganeering.
But America's new oil discoveries are not occurring in a vacuum. The entire Western Hemisphere is enjoying a fossil fuel boom, from northern Canada to Brazil and Argentina. America's backyard will soon be comparable to the oil-rich Persian Gulf, keeping more American money -- and troops -- at home. Illegal immigration should taper off as well, as oil-rich Latin American economies reap huge cash bonanzas. Hugo Chavez's Venezuela will soon be simply one of many regional exporters.
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"When you divide the amount you have in reserves by the rate at which you are extracting the resource, you get the number of years the reserves will last at that rate of extraction. Accordingly, I include the R/P ratio in Figure 1 as “Years Left”
A couple of things to point out. First, the “Years Left”, the R/P ratio, is currently more than forty years … and has been for about a quarter century. Thirty years ago, we only had 30 years of proven oil reserves left. Estimates then said we would be running out of oil about now.
Twenty-five years ago, we had about forty years left. Ten years ago we had over forty years left. Now we have over forty-five years left. I’m sure you see the pattern here."
...
"Now, at some point this party has to slow down, nothing goes on forever … but the data shows we certainly don’t need to hurry to replace oil with solar energy or rainbow energy or wind energy in the next few decades. We have plenty of time for the market to indicate the replacement."
http://wattsupwiththat.com/2011/12/13/the-rp-ratio/#more-53061
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The shale gas boom has been a rare bright spot in the U.S. economy, so much of the country let out a shudder two weeks ago when the Environmental Protection Agency issued a "draft" report that the drilling process of hydraulic fracturing may have contaminated ground water in Pavillion, Wyoming. The good news is that the study is neither definitive nor applicable to the rest of the country.
"When considered together with other lines of evidence, the data indicates likely impact to ground water that can be explained by hydraulic fracking," said the EPA report, referring to the drilling process that blasts water and chemicals into shale rock to release oil and natural gas. The news caused elation among environmentalists and many in the media who want to shut down fracking.
More than one-third of all natural gas drilling now uses fracking, and that percentage is rising. If the EPA Wyoming study holds up under scrutiny, an industry that employs tens of thousands could be in peril.
But does it stand up? This is the first major study to have detected linkage between fracking and ground-water pollution, and the EPA draft hasn't been peer reviewed by independent scientific analysts. Critics are already picking apart the study, which Wyoming Governor Matt Mead called "scientifically questionable."
Enlarge Image
CloseAssociated Press
Natural gas wellheads and other production facilities are shown around the rural community of Pavillion, Wyoming in 2007.
.The EPA says it launched the study in response to complaints "regarding objectionable taste and odor problems in well water." What it doesn't say is that the U.S. Geological Survey has detected organic chemicals in the well water in Pavillion (population 175) for at least 50 years—long before fracking was employed. There are other problems with the study that either the EPA failed to disclose or the press has given little attention to:
• The EPA study concedes that "detections in drinking water wells are generally below [i.e., in compliance with] established health and safety standards." The dangerous compound EPA says it found in the drinking wells was 2-butoxyethyl phosphate. The Petroleum Association of Wyoming says that 2-BE isn't an oil and gas chemical but is a common fire retardant used in association with plastics and plastic components used in drinking wells.
• The pollution detected by the EPA and alleged to be linked to fracking was found in deep-water "monitoring wells"—not the shallower drinking wells. It's far from certain that pollution in these deeper wells caused the pollution in drinking wells. The deep-water wells that EPA drilled are located near a natural gas reservoir. Encana Corp., which owns more than 100 wells around Pavillion, says it didn't "put the natural gas at the bottom of the EPA's deep monitoring wells. Nature did."
• To the extent that drilling chemicals have been detected in monitoring wells, the EPA admits this may result from "legacy pits," which are old wells that were drilled many years before fracking was employed. The EPA also concedes that the inferior design of Pavillion's old wells allows seepage into the water supply. Safer well construction of the kind normally practiced today might have prevented any contaminants from leaking into the water supply.
• The fracking in Pavillion takes place in unusually shallow wells of fewer than 1,000 to 1,500 feet deep. Most fracking today occurs 10,000 feet deep or more, far below drinking water wells, which are normally less than 500 feet. Even the EPA report acknowledges that Pavillion's drilling conditions are far different from other areas of the country, such as the Marcellus shale in Pennsylvania. This calls into question the relevance of the Wyoming finding to newer and more sophisticated fracking operations in more than 20 states.
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The safety of America's drinking water needs to be protected, as the fracking industry itself well knows. Nothing would shut down drilling faster, and destroy billions of dollars of investment, than media interviews with mothers afraid to let their kids brush their teeth with polluted water. So the EPA study needs to be carefully reviewed.
But the EPA's credibility is also open to review. The agency is dominated by anticarbon true believers, and the Obama Administration has waged a campaign to raise the price and limit the production of fossil fuels.
Natural gas carries a smaller carbon footprint than coal or oil, and greens once endorsed it as an alternative to coal and nuclear power. But as the shale gas revolution has advanced, greens are worried that plentiful natural gas will price wind and solar even further out of the market. This could mean many more of the White House's subsidized investments will go belly up like Solyndra.
The other big issue is regulatory control. Hydraulic fracturing isn't regulated by the EPA, and in 2005 Congress reaffirmed that it did not want the EPA to do so under the Safe Drinking Water Act. The states regulate gas drilling, and by and large they have done the job well. Texas and Florida adopted rules last week that followed other states in requiring companies to disclose their fracking chemicals.
But the EPA wants to muscle in, and its Wyoming study will help in that campaign. The agency is already preparing to promulgate new rules regulating fracking next year. North Dakota Governor Jack Dalrymple says that new EPA rules restricting fracking "would have a huge economic impact on our state's energy development. We believe strongly this should be regulated by the states." Some 3,000 wells in the vast Bakken shale in North Dakota use fracking.
By all means take threats to drinking water seriously. But we also need to be sure that regulators aren't spreading needless fears so they can enhance their own power while pursuing an ideological agenda.
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http://bighollywood.breitbart.com/jjmnolte/2011/06/01/watch-gasland-director-josh-fox-admit-he-left-key-facts-out-of-enviro-doc/
Watch ‘Gasland’ Director Josh Fox Admit He Left Key Facts Out of Enviro-Doc
by John Nolte
This is quite possibly one of the greatest pieces bonafide journalism I’ve ever seen, especially how filmmaker/journalist Phelim McAleer manages to get ”Gasland” director Josh Fox’s to admit he left a key piece of relevant information out of his film. Fox’s Academy Award-nominated documentary blames the energy industry’s practice of hydraulic fracturing (fracking) for natural gas on increased levels of methane that are so high people can actually light their tap water on fire.
Scary stuff, right?
However, what we learn here is that something Fox chose not to reveal was that there are reports of people being able to light their tap water on fire decades before any kind of fracking occurred in the same geographical area. You’ll get the full context in the video:
[youtube]http://www.youtube.com/watch?feature=player_embedded&v=e9CfUm0QeOk[/youtube]
http://www.youtube.com/watch?feature=player_embedded&v=e9CfUm0QeOk
“Gasland” is an extremely well-made documentary, so well done, in fact, that about an hour in Fox had me convinced that fracking for natural gas really was a problem. The film is produced in a low-key kind of way using a tone that’s practically hypnotic and when you watch people light their freakin’ tap water on fire it blows your mind. My wife and I — and she’s even more skeptical of these enviro-Marxists than I am — just looked at each other in horror. After the credit’s rolled, our skepticism returned, and soon after, Ann McElhinney (McAleer’s wife and filmmaking partner) pretty much confirmed our skepticism.
But McAleer’s success in getting Fox to admit he knew about these decades-old reports is like (and not just because of the courtroom setting) the closing scene in a “Perry Mason” episode.
Why would Fox not include the relevant fact that there were reports of high enough methane levels to light tap water on fire decades prior to any kind of industrial fracking being done? But that’s not the real question, is it? Because the answer is obvious: Fox has an agenda and he very well knew that such a pertinent fact would completely undermine that agenda. The real question, though, is why would an Academy Award-nominated documentary that currently sits at a nearly unprecedented 100% fresh at Rotten Tomatoes get away with this for so long? Even if you Google “Gasland debunked” most of the links appear to be about debunking the debunkers. Same with “Gasland lies.”
With a few very simple, straight-forward questions (always the best kind), McAleer not only allows Josh Fox to bury himself but we also — unless I missed something – get a lesson in just how pathetic the elite media is when it comes to puncturing narratives they’re sympathetic towards.
McAleer’s report is here.
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Try as government usually does, it's hard to keep the U.S. economy down. That's the message of yesterday's announcement of some $4.8 billion in new foreign investment in America's booming shale oil and gas industry.
France's Total SA will invest $2.3 billion in Chesapeake Energy Corp. assets to explore the Utica shale formations in Ohio, while China Petrochemical Corp. will spend $2.5 billion in a joint venture with Devon Energy to explore oil and gas projects from the Tuscaloosa Marine shale in Alabama and Mississippi to the Niobrara in Colorado.
These investments continue the trend of global energy dollars returning to the U.S. as the shale revolution continues. Once-small (now big) U.S. companies like Chesapeake led the way, U.S. majors like Exxon and Chevron have joined the party, and now foreigners are following.
The investments are all the more notable because natural gas prices are down to $3 per thousand cubic feet from $5 a year ago. Most drilling booms are associated with rising prices. The risk is that low prices will lead to a washout, but the shale boom may be a paradigm shift that remakes the U.S. energy industry.
The new investors contribute capital that allows their U.S. partners to exploit their shale assets more quickly and thoroughly. The additional capital is all the more necessary as the extent of America's shale energy deposits become clearer. The Marcellus shale in Pennsylvania and West Virginia has been promising for years, but the Utica play may turn out to be as lucrative.
In return, foreign companies get access to what they expect to be attractive economic returns and the chance to learn how to tap shale rock. Total, for instance, has exploration interests in Argentina, Denmark and Poland. Sinopec no doubt has its eye on China's untapped shale formations.
The biggest winner is the U.S. economy. Chesapeake estimates its deal alone could create 25,000 high-paying jobs within the next few years. The drilling boom has created a growing market for businesses that service oil drillers, such as steel-pipe producers. Low natural gas prices are also a boon for consumers and are creating new opportunities for industries that use natural gas as a feedstock, such as chemical and fertilizer plants that only five years ago would have gone overseas.
The animal spirits unleashed by all this are so great that even the Obama Administration might not be able to dampen them. New York state still has a ban on the drilling technique known as hydraulic fracturing, but sooner or later Albany's revenue needs will trump its anticarbon pieties. If President Obama wants to help his re-election chances, he'll stop wasting tax dollars on losers like Solyndra and "green jobs" and start talking about the brown jobs that are already multiplying in the private economy.
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Ya can't make this stuff up :roll:
WASHINGTON — When the companies that supply motor fuel close the books on 2011, they will pay about $6.8 million in penalties to the Treasury because they failed to mix a special type of biofuel into their gasoline and diesel as required by law.
At the South Dakota plant, Poet is testing its technology and the economics of producing ethanol from plant waste.
But there was none to be had. Outside a handful of laboratories and workshops, the ingredient, cellulosic biofuel, does not exist.
In 2012, the oil companies expect to pay even higher penalties for failing to blend in the fuel, which is made from wood chips or the inedible parts of plants like corncobs. Refiners were required to blend 6.6 million gallons into gasoline and diesel in 2011 and face a quota of 8.65 million gallons this year.
“It belies logic,” Charles T. Drevna, the president of the National Petrochemicals and Refiners Association, said of the 2011 quota. And raising the quota for 2012 when there is no production makes even less sense, he said.
Penalizing the fuel suppliers demonstrates what happens when the federal government really, really wants something that technology is not ready to provide. In fact, while it may seem harsh that the Environmental Protection Agency is penalizing them for failing to do the impossible, the agency is being lenient by the standards of the law, the 2007 Energy Independence and Security Act.
The law, aimed at reducing the nation’s greenhouse gas emissions, its reliance on oil imported from hostile places and the export of dollars to pay for it, includes provisions to increase the efficiency of vehicles as well as incorporate renewable energy sources into gasoline and diesel.
It requires the use of three alternative fuels: car and truck fuel made from cellulose, diesel fuel made from biomass and fuel made from biological materials but with a 50 percent reduction in greenhouse gases. Only the cellulosic fuel is commercially unavailable. As for meeting the quotas in the other categories, the refiners will not close their books until February and are not sure what will happen.
The goal set by the law for vehicle fuel from cellulose was 250 million gallons for 2011 and 500 million gallons for 2012. (These are small numbers relative to the American fuel market; the E.P.A. estimates that gasoline sales in 2012 will amount to about 135 billion gallons, and highway diesel, about 51 billion gallons.)
Even advocates of renewable fuel acknowledge that the refiners are at least partly correct in complaining about the penalties.
“From a taxpayer/consumer standpoint, it doesn’t seem to make a lot of sense that we would require blenders to pay fines or fees or whatever for stuff that literally isn’t available,” said Dennis V. McGinn, a retired vice admiral who serves on the American Council on Renewable Energy.
The standards for cellulosic fuel are part of an overall goal of having 36 billion gallons of biofuels incorporated annually by 2022. But substantial technical progress would be needed to meet that — and lately it has been hard to come by.
Michael J. McAdams, executive director of the Advanced Biofuels Association, said the state of the technology for turning biological material like wood chips or nonfood plants straight into hydrocarbons — instead of relying on conversion by nature over millions of years, which is how crude oil originates — was advancing but was not yet ready for commercial introduction.
Of the technologies that are being tried out, he added, “There are some that are closer to the beaker and some that are closer to the barrel.”
The Texas renewable fuels company KiOR, for example, has broken ground on a plant in Columbus, Miss., that is supposed to start turning Southern yellow pine chips into 11 million gallons a year of gasoline and diesel components in the fourth quarter of 2012, although Matthew Hargarten, a spokesman, said, “Obviously, timelines change.”
Mr. McGinn of the council on renewable energy, defends the overall energy statute. Even if the standards for 2011 and 2012 are not met, he said, “I am absolutely convinced from a national security perspective and an economic perspective that the renewable fuel standard, writ large, is the right thing to do.” With oil insecurity and climate change related to greenhouse gas emissions as worrisome as ever, advocates say, there is strong reason to press forward.
The oil industry does not agree.
Mr. Drevna of the refiners association argued that in contrast to 2007, when Congress passed the law, “all of a sudden we’re starting to find tremendous resources of our own, oil and natural gas, here in the United States, because of fracking,” referring to a drilling process that involves injecting chemicals and water into underground rock to release gas and oil.
What is more, the industry expects the 1,700-mile Keystone Pipeline, which would run from oil sands deposits in Canada to the Gulf Coast, to provide more fuel for refineries, he said.
But Cathy Milbourn, an E.P.A. spokeswoman, said that her agency still believed that the 8.65-million-gallon quota for cellulosic ethanol for 2012 was “reasonably attainable.” By setting a quota, she added, “we avoid a situation where real cellulosic biofuel production exceeds the mandated volume,” which would weaken demand.
The underlying problem is that Congress legislated changes that laboratories and factories have not succeeded in producing. This is not for want of trying, and efforts continue.
One possible early source is the energy company Poet, a large producer of ethanol from corn kernels. The company is doing early work now on a site in Emmetsburg, Iowa, that is supposed to produce up to 25 million gallons a year of fuel alcohol beginning in 2013 from corn cobs.
And Mascoma, a company partly owned by General Motors, announced last month that it would get up to $80 million from the Energy Department to help build a plant in Kinross, Mich., that is supposed to make fuel alcohol from wood waste. Valero Energy, the oil company, and the State of Michigan are also providing funds.
Yet other cellulosic fuel efforts have faltered. A year ago, after it was offered more than $150 million in government grants, Range Fuels closed a commercial factory in Soperton, Ga., where pine chips were to be turned into fuel alcohols, because it ran into technological problems.
Airlines have had marginally more success with renewable fuels, but mostly because they have been willing to pay huge sums for sample quantities. Alaska Airlines said recently it had paid $17 a gallon. Lufthansa plans to fly a Boeing 747 from Frankfurt to Dulles International Airport near Washington using 40 tons of a biofuel mix.
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Oil production on federal lands is down 13 percent in 2011: 97,721,813 barrels in 2011 versus 112,124,812 barrels in 2010.
http://www.instituteforenergyresearch.org/2012/01/10/interior-department-energy-propaganda-misleading-disingenuous/
Meanwhile, gas prices are up. Some expect $4 by spring and spikes up to $5 in summer/fall during the camp.
Per the discussion on Path science, I don't mean one caused the other. But the USA owns a LOT of the land containing vast amounts of energy and the anti-energy direction of the administration is both contributing to the problem and delaying the solution. Also reap what you sew, high gas price is part of the agenda so they can answer to the economic damage of that in the election.
Artificially high energy prices costs us jobs in all sectors.
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I'm not clear on the bio fuel thing. To me, it sounds like something the EPA should be against.
My old environmental science professor was a hard core liberal. She believed in global warming like I believe the sky is blue. She got grants from the EPA for wetlands research. Dah Dah Dah.
Anyway, she seemed to think that the outcome of removing enough biomass from the earth to burn as a bio fuel would be disastrous to the ecosystem and that the ground would stop producing anything at all in just a few years.
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By LAURA MECKLER And KEITH JOHNSON
LAS VEGAS—Working to advance his "all of the above" energy strategy, President Barack Obama on Thursday embraced natural gas as a transportation fuel, saying it is cleaner and cheaper than oil, and much more abundant inside the U.S.
"We've got a supply of natural gas under our feet that can last America nearly a hundred years….It turns out we are the Saudi Arabia of natural gas," Mr. Obama said at a United Parcel Service Inc. facility that will serve as a refueling station for trucks that run on liquefied natural gas. "Think about an America where more cars and trucks are running on domestic natural gas than on foreign oil."
The president officially opened the first natural gas corredor from LA to Salt Lake City-where medium- and heavy-duty trucks can refuel along the way.
Atlanta-based UPS used more than $5 million in federal support to upgrade its own fleet of trucks and complete the corridor.
Mr. Obama nodded to concerns associated with hydraulic fracturing, known as fracking, a technique used to extract the natural gas that environmentalists worry will contaminate groundwater supplies. The White House said this week that the administration will require companies drilling for gas on public lands to disclose the chemicals they use.
"I know there are families worried about the impact this could have on our environment and on the health of our communities, and I share that concern," Mr. Obama said. "America will develop this resource without putting the health and safety of our citizens at risk."
Also Thursday, Mr. Obama announced the final lease sale of offshore acreage in the central Gulf of Mexico, scheduled for late June, with conditions meant to make sure that oil companies develop the leases they acquire, officials said. The lease sale of some 38 million acres will be the last one of the current five-year plan for development of offshore resources. The agreement will include a sliding scale of rental rates to compensate deep-water lessees for delays in beginning operations in the wake of the 2010 BP PLC Deepwater Horizon oil spill.
According to administration officials, the latest Gulf lease sale could lead to the development of one billion barrels of oil.
The president has faced strong criticism on energy policy after he blocked for now the construction of the Keystone XL oil pipeline from Canada to the U.S. Gulf Coast. Republicans have excoriated that decision, saying Mr. Obama put the concerns of environmentalists over jobs.
Later Thursday, at an event at Buckley Air Force Base in Aurora, Colo., outside Denver, Mr. Obama was set to tout his administration's support for alternative energy, particularly through the military. The president was set to play up a Navy announcement that it will buy a gigawatt of clean energy, enough to power 250,000 homes at any given time, and point to a solar-energy installation on the base.
The White House natural-gas plan, contingent on congressional support, also includes tax credits to offset part of the cost of upgrading trucks to run on natural gas and federal help to spur the creation of five additional natural-gas corridors on heavy trucking routes. Additionally, the Obama administration plans to promote federal research to find new ways to use natural gas for transportation, as well as supporting the conversion of city bus and truck fleets to run on the cleaner fuel, administration officials said.
The Obama administration's embrace of natural gas as a transportation fuel comes after years of similar efforts by high-profile proponents ranging from the oil-and-gas tycoon T. Boone Pickens to Senate Majority Leader Harry Reid, a Nevada Democrat.
The Obama administration had signaled before that it favored the idea, but the president jumped in with both feet this week, first in his State of the Union speech Tuesday and then Thursday in Las Vegas.
The U.S. is experiencing an unexpected glut in natural-gas supplies thanks to a revolution in drilling technology over the last decade. Natural-gas prices have fallen to near 10-year lows.
Some important industrial sectors are less eager to see natural-gas demand increase, notably big chemical and petrochemical concerns. They rely on cheap natural gas, a key input for their operations, to boost international competitiveness.
Write to Laura Meckler at laura.meckler@wsj.com and Keith Johnson at keith.johnson@wsj.com
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Perhaps misfiled, but a look at how some of the shibboleths of the environmental crowd fail to stand up to real world examination.
Get Dense
It’s time to stop wasting land and resources in the name of environmentalism.
JIM RICHARDSON/CORBIS
The opposite of dense: windmills in Kansas.
More than three decades ago, the British economist E. F. Schumacher stated the essence of environmental protection in three words: “Small is beautiful.” As Schumacher argued in a famous book by that title, man-made disturbances of the natural world—farms, for example, and power plants—should have the smallest possible footprints.
But how can that ideal be realized in a world that must produce more and more food and energy for its growing population? The answer, in just one word this time, is density. Over the course of the last century, human beings have found ways to concentrate crops and energy production within smaller and smaller areas, conserving land while meeting the ever-growing global demand for calories and watts. This approach runs counter to the beliefs of many environmental activists and politicians, whose “organic” and “renewable” policies, as nature-friendly as they sound, squander land. The real organizing principle for a green future is density, which not only provides the goods that we need to survive and prosper but also achieves the land-preservation goals of genuine environmentalists.
Food cultivation is an excellent example of the virtues of density. During the second half of the twentieth century, hybrid seeds and synthetic fertilizers, along with better methods of planting and harvesting, produced stunning increases in agricultural productivity. Between 1968 and 2005, global production of all cereal crops doubled, even though the amount of cultivated acreage remained about the same. Indur Goklany, a policy analyst for the U.S. Department of the Interior, estimates that if agriculture had remained at its early-sixties level of productivity, feeding the world’s population in 1998 would have required nearly 8 billion acres of farmland, instead of the 3.7 billion acres that were actually under cultivation. Where in the world—literally—would we have found an extra 4.3 billion acres of land, an area just slightly smaller than South America?
There is an important exception to the historical trend of ever-denser agriculture, however: the production of organic food, which doesn’t use many fertilizers and pesticides. Various recent studies have found that land devoted to organic farming produces 50 percent less wheat, 55 percent less asparagus and lettuce, and 23 percent less corn than conventionally farmed land of the same acreage does.
A large-scale transition to organic production therefore makes little sense. In a 2011 essay in Slate, James McWilliams, a history professor at Texas State University and a fearless debunker of the hype over organic food, pointed out that the global population was likely to increase by some 2.3 billion people over the next four decades. So many people, combined with an emerging middle class in developing countries like China and India, would require the world’s farmers to grow “at least 70 percent more food than we now produce.” The latest figures from the UN’s Food and Agriculture Organization (FAO), which showed that the world had little unused arable land, led to an obvious conclusion, McWilliams wrote: “Skyrocketing demand for food will have to be met by increasing production on pre-existing acreage. . . . Ninety percent of the additional calories required by midcentury will have to come through higher yields per acre.” That is, agriculture must become even denser, producing still more food from the available land. Organic farming would do the reverse.
Inefficient organic production would also undoubtedly increase the cost of food. That’s a particular concern at a time when global food prices are near record highs: last February, the FAO reported that its Food Price Index, a basket of commodities that tracks changes in global food costs, hit its highest level since the organization began documenting prices in 1990. Though food prices have fallen somewhat since then, the Food Price Index throughout 2011 was roughly 60 percent higher than it was back in 2007. Adopting low-density agricultural techniques could also increase deforestation, as farmers desperately seek more farmland—a result that should disturb true environmentalists.
Yet we are continually bombarded with arguments for organic agriculture. In 2010, Maria Rodale—the chairman and CEO of the Rodale Institute, a pro-organic organization—wrote an essay arguing that organic farming was “the most effective way to feed the world and mitigate global warming.” Organic-friendly grocers, like Whole Foods Market, have seen huge increases in their market share, and industry groups like the Organic Trade Association point out that global sales of organic food and beverages more than doubled, to some $51 billion, between 2003 and 2008.
A related crusade against density is the push for biofuels, which are supposed to help reduce carbon-dioxide emissions but will divert huge blocks of arable land away from food production and into the manufacture of tiny amounts of motor fuel. The leading biofuel at the moment is corn ethanol, whose “power density”—the amount of energy flow that can be harnessed from a given area of land—is abysmally low. Some energy analysts put it as low as 0.05 watts per square meter of farmland. By comparison, a relatively small natural-gas well that produces just 60,000 cubic feet of gas per day has a power density of 28 watts per square meter; the power density of nuclear plants is even higher.
The power density of ethanol is so low that in 2011, to produce a quantity of motor fuel whose energy equivalent was just 0.6 percent of global oil consumption, the American corn-ethanol sector had to convert a mind-boggling 4.9 billion bushels of grain into ethanol. That’s more corn than the combined outputs of the European Union, Mexico, Argentina, and India. It represents 40 percent of all the corn grown in the United States—about 15 percent of global corn production and 5 percent of all the grain grown in the world. The EU, too, is pushing to produce motor fuel from farmland.
These efforts have, unsurprisingly, driven global food prices upward. In a June 2011 article in Scientific American, Tim Searchinger, a research scholar at the Woodrow Wilson School at Prince- ton University, observed that “since 2004 biofuels from crops have almost doubled the rate of growth in global demand for grain and sugar and pushed up the yearly growth in demand for vegetable oil by around 40 percent.” We need to consider the moral impact of our actions, Searchinger continued: “Our primary obligation is to feed the hungry. Biofuels are undermining our ability to do so.” Yet each year, Congress lavishes some $7 billion worth of subsidies on the ethanol industry, and in his January 2011 State of the Union speech, President Obama declared that “we can break our dependence on oil with biofuels.”
Biofuel enthusiasts, recognizing the moral problems with converting food into fuel, have long promoted cellulosic ethanol, which is derived from inedible biomass, such as switchgrass and trees. In 1976, Amory Lovins, cofounder of the Rocky Mountain Institute and a darling of the Green Left, wrote in Foreign Affairs that “exciting developments in the conversion of agricultural, forestry and urban wastes to methanol and other liquid and gaseous fuels now offer practical, economically interesting technologies sufficient to run an efficient U.S. transport sector.” Three decades later, not a single company in the United States was producing significant quantities of cellulosic ethanol—yet in 2004, Lovins and several coauthors wrote Winning the Oil Endgame, still clamoring for cellulosic ethanol and even claiming that it would “strengthen rural America, boost net farm income by tens of billions of dollars a year, and create more than 750,000 new jobs.”
Will it? Cellulosic ethanol’s power density, though higher than corn ethanol’s, is nevertheless very low. Even the best-managed tree plantations achieve power densities of only about 1 watt per square meter of cultivated area. That means you need gargantuan quantities of biomass to produce meaningful volumes of motor fuel. Let’s say that you wanted to replace just one-tenth of U.S. oil consumption with ethanol derived from switchgrass. That would require you to produce about 425 million tons of switchgrass per year, which would mean cultivating some 36.9 million acres of land—an area roughly the size of Illinois. Put another way: to replace 10 percent of the country’s oil needs with cellulosic ethanol, you’d need to plant switchgrass in an area equal to 8 percent of all American cropland currently under cultivation.
Nevertheless, in May 2008, Speaker of the House Nancy Pelosi helped pass a subsidy-packed $307 billion farm bill, declaring it an “investment in energy independence” because it provided “support for the transition to cellulosic ethanol.” Under Pelosi’s leadership, Congress also mandated that fuel suppliers in the United States blend at least 21 billion gallons of cellulosic ethanol into the American gasoline pool by 2022. To reach that standard, Congress set production targets: in 2011, for instance, domestic distilleries would supposedly produce some 250 million gallons of cellulosic ethanol. But the commercial production of cellulosic ethanol remains so insignificant that the Environmental Protection Agency, which administers the government’s renewable-fuel rules, was forced to slash the production target to just 6.6 million gallons.
Over the past decade, global energy consumption has increased by about 28 percent. Today, the world’s inhabitants are consuming the equivalent of 240 million barrels of oil per day. We cannot depend on the planet’s farmland to provide the enormous quantities of energy needed by countries like China, India, Indonesia, and Brazil as millions of their citizens move into the modern economy. We must rely on forms of energy that have the highest density and, therefore, the smallest footprints.
Biofuels aren’t the only renewable sources of energy whose low power densities make them impractical. Wind turbines have a power density of about 1 watt per square meter. Compare that with the two nuclear reactors at Indian Point in Westchester County, which provide as much as 30 percent of New York City’s electricity. Even if you include the entire footprint of the Indian Point project—about 250 acres—the site’s power density exceeds 2,000 watts per square meter. To generate as much electricity as Indian Point does, you’d need to pave at least 770 square miles of land with wind turbines, an area slightly smaller than the state of Rhode Island. Further, few people could live on that great expanse of land because the low-frequency sound that wind turbines generate can cause health problems.
Until now, we’ve examined density chiefly as it relates to area: how much food or energy can be produced on a certain quantity of land. But wind projects defy density in a second way, eating up not just huge tracts of land, relative to their poor performance, but enormous quantities of steel as well. Installing a single wind turbine requires about 200 tons of steel. The newest turbines have capacities of about 4 megawatts. Divide four by 200, and you’ll find that such a turbine can produce about 0.02 megawatts of electricity per ton of steel. Compare that with a conventional natural-gas-fired turbine—say, General Electric’s LM6000. The LM6000 weighs nine tons and can generate nearly 43 megawatts, meaning that it produces about 4.7 megawatts per ton of steel—more than 230 times as many as the wind turbine does.
These numbers are only ballpark figures, of course, and they don’t account for the other resources needed to produce electricity. For instance, wind turbines are generally located far from urban areas and require the construction of thousands of miles of high-voltage transmission lines, while gas turbines must be supplied by long steel pipelines carrying methane from distant wells. But even if the calculations are off by a full order of magnitude—and gas-fired generation uses steel merely 23 times as efficiently as wind generation does, rather than 230 times—it remains clear that wind energy production is an enormously resource-intensive process.
Fortunately, opposition to wind projects is growing rapidly. The United States has seen the rise of about 170 anti-wind groups over the past few years. Ontario in Canada alone has more than 50, the European Platform Against Windfarms has 505 signatory organizations from 23 countries, and in the United Kingdom, some 250 anti-wind groups have formed to fight industrial wind projects in Wales, Scotland, and elsewhere. The resistance is easy to understand: people don’t want to look at 400-foot-high industrial turbines all day, or at flashing red lights all night, or at unsightly transmission lines.
Environmentalists themselves have begun to recognize the inefficiency of wind turbines. In 2009, the Nature Conservancy, one of America’s most conservative environmental groups, issued a report condemning the “energy sprawl” that comes with large-scale wind-energy projects. Even hard-core environmental groups like Earth First! have sprung into action. In November 2010, five people, several of them from Earth First!, were arrested for blocking a road leading to a construction site for a 60-megawatt wind project in Maine. According to the Portland Press Herald, one of the protesters carried a sign: STOP THE RAPE OF RURAL MAINE. But politicians have been slower to object to energy sprawl. In March 2010, governors from 29 states implored Congress and the White House to install more wind turbines across the country, arguing that wind energy would “reduce electric-sector greenhouse gas emissions by about 25 percent.”
The virtues of density can be seen even in nuclear waste. The American commercial nuclear-power industry, over its entire history, has produced about 60,000 tons of high-level waste. Stacked to a depth of about 15 feet, that would cover an area the size of one football field. Coal-fired power plants in the United States, by contrast, generate about 130 million tons of coal ash, much of it contaminated with heavy metals, in a single year. Yes, radioactive waste is toxic and long-lived, but it can be stored safely. France produces about 80 percent of its electricity from nuclear fission, and all of its high-level waste is stored in a single building about the size of a soccer field.
Perhaps the most familiar example of environmentally friendly density, though, is the way humanity has concentrated itself by moving from the country to cities, a process that is happening especially rapidly in the developing world. The opposite process, suburbanization, requires far more land area per resident—and therefore more miles of streets, electricity cables, and sewer lines (see “Green Cities, Brown Suburbs,” Winter 2009). In a 2009 essay for the Atlantic, architect and author Witold Ryb- czynski wrote that “being truly green means returning to the kinds of dense cities and garden suburbs Americans built in the first half of the 20th century.”
The greenness of density leads to two conclusions. First, those who make environmental policy should consider density a desirable goal in nearly all the issues that they confront. And second, the real environmentalists aren’t headline-seeking activists and advocacy groups; they’re farmers, urban planners, agronomists, and, yes, even natural-gas drillers and nuclear engineers.
Robert Bryce is a senior fellow at the Center for Energy Policy and the Environment at the Manhattan Institute.
http://www.city-journal.org/2012/22_1_environmentalism.html
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By LUCIAN PUGLIARESI
Opposition to the Keystone XL pipeline comes in many forms. Former House speaker and current Democratic Minority Leader Nancy Pelosi suggested at a press briefing this month that the pipeline would have no value to the U.S.: "This oil was always destined for overseas. It's just a question of whether it leaves Canada by way of Canada, or it leaves Canada by way of the United States."
Really? The refiners who would be at the end of the pipeline do not re-export crude oil. Instead they produce high-value petroleum products for U.S. and foreign markets such as Brazil, Mexico and Europe.
According to the federal Energy Information Administration, the U.S. exported three million barrels per day of finished petroleum products in October 2011, a new high (versus domestic sales of 19 million barrels per day from all sources, including imports). Yet the U.S. imports two million barrels per day of finished petroleum products thanks to transportation inefficiencies.
For example, increased production of refined products from Gulf Coast refiners could serve East Coast markets but doesn't, thanks to the 1920s Jones Act. This protectionist legislation requires that all goods transported by water between U.S. ports be carried in (high-cost, naturally) ships built, owned, operated and crewed by Americans—and the existing fleet is tied up in long-term charters.
Canadian crude is perfectly matched to the complex and expensive refinery technology of many Gulf Coast refineries. The production of refined petroleum products is a tough, low-margin business operating in an environment of stiff foreign competition, flat domestic demand, congressional mandates for exotic biofuels, and an avalanche of existing and proposed environmental regulations. U.S. Gulf Coast refiners are now well positioned because they have access to growing markets in Latin America, and have made multibillion dollar investments in advanced processing technology that permits them to run lower-cost crudes, such as blended bitumen from the oil sands in Alberta. At least that was the plan before President Obama's war on fossil fuels.
This bright spot in the domestic refining industry is important. High feedstock costs, declining demand, new fuel standards, expanding environmental regulations and foreign competition are now taking a heavy toll on older and less complex refineries. By summer 2012, with the closing of the ConocoPhillips and Sunoco plants in Pennsylvania, the Northeast will have lost over 700,000 barrels per day of capacity since 2008. The American integrated oil company Hess announced Jan. 18 that it would close its refinery in the U.S. Virgin Islands, which provides large volumes of gasoline, heating oil and jet fuel in the Northeast.
If the Gulf Coast refineries can expand access to Canadian crudes, the combination of low-cost refinery fuel in the form of natural gas and currently installed processing technologies will yield a world-class refining center with a competitive advantage in the production of refined products. U.S. refiners will be in a strong position to expand their access to markets throughout the Western hemisphere and into Europe.
President Obama's jobs council has called for an "all-in approach" to energy policy and expedited permitting for energy projects. Meeting these objectives requires open markets that capitalize on production and transportation efficiencies.
Admittedly, the production of refined products doesn't have the politically correct caché of electric cars and the failed, government-sponsored Solyndra solar plant. But the economic value and subsequent employment growth from producing petroleum products is large and long term.
We are at the leading edge of an American petroleum renaissance. The combination of lower costs for both crude oil and natural gas provides a great opportunity for U.S. refinery capacity to increase over the next decade. But this will require a predictable and sensible regulatory regime—a regime noticeably lacking during the Obama administration.
Mr. Pugliaresi is president of the Energy Policy Research Foundation.
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http://hotair.com/archives/2012/02/09/fantastic-china-canada-reach-quick-deals-on-oil-uranium/
Fantastic. China, Canada reach quick deals on oil, uranium
posted at 11:35 am on February 9, 2012 by Jazz Shaw
Last month we discussed the rather alarming news that Canadian Prime Minister Stephen Harper was planning a trip to China to discuss possible natural resources deals with the economic superpower. It seemed no coincidence that the trip was announced close on the heels of Barack Obama’s decision to kick the can down the road on the Keystone XL pipeline yet again. But at that time, I retained some hope that perhaps this was just a warning siren to Obama which would remind him that Canada had plenty of other options should we decide not to do business with them.
Apparently Harper hasn’t cared much for what he’s been hearing out of Washington and found a very willing ear across the Pacific because it seems that some deals have been struck already.
China and Canada declared Thursday that bilateral relations have reached “a new level” following a series of multibillion-dollar trade and business agreements to ship additional Canadian petroleum, uranium and other products to the Asian superpower.
Prime Minister Stephen Harper and the Chinese leadership said Thursday the economic co-operation agreements — and billions of dollars in new private-sector deals — signed by the two countries over the past few days are unprecedented and will open the door to additional trade and investment.
Harper announced Thursday, following meetings with Chinese President Hu Jintao and Vice-Premier Li Keqiang, that the countries have struck an agreement that will allow Canadian uranium companies to “substantially increase exports to China.”
“We expect to see similar success stories in Canadian energy exports to China, once infrastructure is in place.”
Harper has said building pipelines to the West Coast — such as the proposed Northern Gateway oilsands pipeline and a separate one for liquefied natural gas — is a national priority as Canada looks to ship its vast resources to Asia.
This just gets better and better, doesn’t it? Not only do we have to keep an eye on the Canadians building a shorter pipeline to their western coast to ship all of their oil overseas, but now they’re going to aggressively up the ante on delivering uranium to the Chinese. Oh, I know… you probably think I’m being an old worry wort, right? I mean, China would only use the fuel for peaceful, energy production purposes and would never “lose track” of any of it, right?
Yet again we see that elections matter, and decisions coming from 1600 Pennsylvania Ave. can have both immediate and long term effects not only here at home, but across the oceans as well. Harper’s deals wont be finalized until the Canadian legislature approves them, but they would be foolish indeed to turn it down with no assurances of a market in the U.S. There was never any doubt that Canada would pursue their own best economic and national interests and find a buyer for their resources. It was only a question of who would strike the right deal. And – again – I do not place any blame on Harper for this. He has to look out for Canada’s interests first, not ours. The fault here lies with the White House for playing politics with such a critical issue.
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The profound stupidity and/or selfishness of the President on this is contemptible.
No doubt the Republican candidates will promptly bring this to the American people as part of their campaigns , , ,
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Gas prices' earliest-ever rise above $3.50 a bad sign for motorists
Los Angeles Times 9:29 a.m. EST, February 14, 2012
American motorists have seen the national average for a gallon of regular gasoline rise above $3.50 a gallon on just three occasions, but it has never happened this early in the year. Analysts say it's likely a sign that pain at the pump will rise to some of the highest levels ever seen later this year.
In 2008, average gasoline prices had hit inflation-adjusted records nationally by the summer, but they didn't climb above $3.50 a gallon across the U.S. that year until April 21, according to the AAA Fuel Gauge Report. It happened again last year, but not until March 6.
But $3.50 a gallon gasoline is already here in 2012, weeks before refineries typically shut down for springtime maintenance, and weeks before the states switch from their less expensive winter blends of gasoline to more complicated and pricier summer blends.
"This definitely sets the stage, potentially, for much higher prices later this year," said Brian L. Milne, refined fuels editor for Telvent DTN, a commodity information services firm. "There's a chance that the U.S. average tops $4 a gallon by June, with some parts of the country approaching $5 a gallon."
Today, for example, the national average stands at $3.511, up from $3.480 a week ago, according to the AAA report, which gets its figures from prices compiled by the Oil Price Information Service.
The average in Pennsylvania is even higher: $3.63. According to GasBuddy.com, the cheapest gas in the Allentown area as of Tuesday was $3.49, at USA Gas on West Tilghman St.
There are plenty of reasons for the high prices, and lots of reasons to fear a big price spike in the spring, said Tom Kloza, chief oil analyst for OPIS.
"Early February crude oil prices are higher than they've ever been on similar calendar dates through the years, and the price of crude sets the standard for gasoline prices," Kloza said, later adding, "We've lost a number of refineries in the last six months (to permanent closure). Some of those refineries represented the key to a smooth spring transition from winter-to-spring gasoline."
Some cities, like Los Angeles and New York, are already closing in on $4 a gallon, said Patrick DeHaan, senior petroleum analyst for GasBuddy.com.
The current national average is also 38.3 cents a gallon higher than the old record for Feb. 13, which was set last year.
Ronald D. White of the Los Angeles Times and Sam Kennedy of The Morning Call contributed to this report.
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Caught between Glibness and Energy, I put one article at each location.
'Stupid' and Oil Prices
Obama's Forrest Gump analysis of rising gas prices.
'The American people aren't stupid," thundered President Obama yesterday in Miami, ridiculing Republicans who are blaming him for rising gasoline prices. Let's hope he's right, because not even Forrest Gump could believe the logic of what Mr. Obama is trying to sell.
To wit, that a) gasoline prices are beyond his control, but b) to the extent oil and gas production is rising in America, his energy policies deserve all the credit, and c) higher prices are one more reason to raise taxes on oil and gas drillers while handing even more subsidies to his friends in green energy. Where to begin?
It's true enough that oil prices can't be commanded from the Oval Office, so in that sense Mr. Obama's disavowal of blame is a rare show of humility in the face of market forces. Would that he showed similar modesty in trying to command the tides of home prices, car sales ("cash for clunkers"), or the production of electric batteries.
The oil price surge has several likely sources. One is the turmoil in the Middle East, especially new fears of a supply shock from a conflict with Iran. But it's worth recalling that Mr. Obama also blamed the last oil-price surge, in spring 2011, on the Libyan uprising. Moammar Gadhafi is now gone and Libyan oil production is coming back on stream, yet oil prices dipped only briefly below $90 a barrel and have been rising since October. Something else must be going on.
Mr. Obama yesterday blamed rising demand from the likes of Brazil and China, and there is something to that as well. But this energy demand is also not new, and if anything Chinese and Brazilian economic growth has been slowing in recent months.
Another suspect—one Mr. Obama doesn't like to mention—is U.S. monetary policy. Oil is traded in dollars, and its price therefore rises when the value of the dollar falls, all else being equal. The Federal Reserve throughout Mr. Obama's term has pursued the easiest monetary policy in modern times, expressly to revive the housing market. It has done so with the private support and urging of the White House and through Mr. Obama's appointees who are now a majority on the Fed's Board of Governors.
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Associated Press
Oil staged its last price surge along with other commodity prices when the Fed revved up its second burst of "quantitative easing" in 2010-2011. Prices stabilized when QE2 ended. But in recent months the Fed has again signaled its commitment to near-zero interest rates first through 2013, and recently through 2014. Commodity prices, including oil, have since begun another surge, and hedge funds have begun to bet on commodity plays again. John Paulson says he's betting on gold, the ultimate hedge against a falling dollar.
Fed officials and Mr. Obama want to take credit for easy money if stock-market and housing prices rise, but then deny any responsibility if commodity prices rise too, causing food and energy prices to soar for consumers. They can't have it both ways, as not-so-stupid Americans intuitively understand when they buy groceries or gas. This is the double-edged sword of an economic recovery "built to last" on easy money rather than on sound fiscal and regulatory policies.
As for domestic energy, Mr. Obama rightly points to the rising share of U.S. oil consumption now produced at home. But this trend began in the late Bush Administration, which opened up large new areas on and offshore for oil and gas drilling that are now coming on stream. Mr. Obama sneered at expanded drilling as a candidate in 2008 and for most of his term has done little to expand it.
In early 2010, he proposed to open some new areas to drilling but shut that down after the Gulf oil spill. According to the Greater New Orleans Gulf Permits Index for January 31, over the previous three months the feds issued an average of three deep-water drilling permits a month compared to the historical average of seven. Over the same three months, the feds approved an average of 4.7 shallow-water permits a month, compared to the historical average of 14.7.
Approval of an offshore drilling plan now takes 92 days, 31 more than the historical average. And so far in 2012, an average of 23% of all drilling plans have been approved, compared to the average of 73.4%.
Oh, and don't forget the Keystone XL pipeline, which would have increased the delivery of oil from Canada and North Dakota's Bakken Shale to Gulf Coast refineries, replacing oil from Venezuela.
The reality is that most of the increase in U.S. oil and gas production has come despite the Obama Administration. It is flowing from the shale boom, which is the result of private technological advances and investment. Mr. Obama has seen the energy sun rise and is crowing like a rooster that he made it happen.
Mr. Obama yesterday also repeated his proposal that now is the time to raise taxes on oil and gas companies, as if doing so will make them more likely to drill. He must not believe the economic truism that when you tax something you get less of it, including fewer of the new jobs they've created.
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We'd almost feel sorry for Mr. Obama's gas-price predicament if it weren't a case of rough justice. The President has deliberately sought to raise the price of energy throughout the economy via his cap-and-trade agenda. He is now getting his wish, albeit a little too overtly for political comfort. Mr. Obama has also spent three years blaming George W. Bush for every economic ill. If Mr. Obama now feels frustrated by economic events beyond his control, perhaps he should call Mr. Bush for consolation.
A version of this article appeared Feb. 24, 2012, on page A12 in some U.S. editions of The Wall Street Journal, with the headline: 'Stupid' and Oil Prices. (Subscribe at wsj.com)
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Sort of like Marc Levin's broadcast last night who responded to Brockster's assertion that went something like, "Republicans have three answers for the gas problem: drill drill drill."
Levin pointed out the shear stupidity and contempt for Americans by this comment. Gas doesn't come from gas pumps. Yes to get it we have to drill. And no we can't replace oil with wind and solar.
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Brock man comes out and acts as though he is for nat gas :wink:
Read Wikipedia on nat gas. Scroll to the section for the US. While converting to natural gas doesn't itself cost much getting a certificate from the EPA will cost a bit more - 50 grand:
http://en.wikipedia.org/wiki/Compressed_natural_gas
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CCP wrote: "Scroll to the section for the US. While converting to natural gas doesn't itself cost much getting a certificate from the EPA will cost a bit more - 50 grand:
http://en.wikipedia.org/wiki/Compressed_natural_gas"
You are correct: "the conversion requires a type certificate from the EPA. Meeting the requirements of a type certificate can cost up to $50,000."
That doesn't make sense to me. I was wondering where (besides Wikipedia) you came across that. Maybe it is the fee to Ford, Honda or GM to approve a new model?
CNG is cleaner and we should be all over it for transportation. Not as a government with credits, subsidies or mandates, but as a people. Also, consider CNG hybrids for the superclean consumer.
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Well I am just exploring investing in NG. Right now prices are rock bottom. The fracking technology is a two edge sword for investment. It makes natural gas a resource we can exploit to the nth degree which even the Brock man has to admit though disingenuously and not sincerely.
The problem from investors, by making our huge supplies so readily accessible the supply is not so high the price of nat gas is so cheap the companies margins are squeezed.
I am wondering if the big players would actually make the conversion of all our vehicles to nat gas. Apparantly Pakistan is the leader in number of nat gas vehicles. In the US Kaliflower is the leading state for some fleet vehicles. If regular autos were to go nat gas then I would think the nat gas players would skyrocket. I don't see that happening with this Prez. OTOH I am not sure the likes of Exxon, Conoco, etc will start converting gas stations and if the auto makers will start doing that with cars.
I am not sure what it will take for that.
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CCP, Very interesting stuff. Your point of the $50k fee is just one indicator but to me the risk is all regulatory. Fracking is under attack even though 57 states say no drinking water has ever been contaminated.
We have enough overall demand for energy that the explosion of natural gas (bad choice of words?) will find plenty of uses.
CNG burns cleaner than gasoline, I think it is 25% cleaner for CO2 emissions (when did CO2 become a pollutant?) and cleaner for everything else as well. CNG is not as transportable as gasoline, but good enough for all commuters and metro traffic. It would take extremely high pressure to get a reasonable sized tank to get the full mileage range of a gas tank, but only a doctor can afford a full tank of gas these days anyway.
There are compressors to fill the CNG tank overnight from your home natural gas line. http://www.gasfill.com/ The road tax authorities are not wild about this.
Making CNG widely available in Utah where the mountains trap the air pollution in the valley was Gov. Huntsman's claim to fame. He didn't tout it during his Presidential bid and I don't know what kept the idea from expanding. In our state, only the gas company has a CNG station and only fleets and a few hobbyists are using it. Googling a few vehicles, factory CNG models are available with more coming and there are plenty of kits. There is always the problem of getting people to gradually switch over before widespread availability, like E-85, but if the price, supply and demand are right it can happen fast enough in the metro areas. If not Exxon then someone else can do it. The big constraints are cost in getting the right equipment and of course the regulatory issues.
If the supplies get too high and the prices too low, the usage can easily switch over to other uses like generating electricity. Remember that Japan with its nuclear problem and Germany closing nuclear plants and the USA failing to build new plants makes a huge, unfilled demand for clean and plentiful substitutes. You can put the generator at the point of use, home or business instead of taking electricity from the grid. Like with solar and wind, you could potentially sell power back to the electric company.
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"Fracking is under attack even though 57 states say no drinking water has ever been contaminated."
:lol:
Almost spit coffee on my laptop.
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Summary
The United States has significantly increased its natural gas production since 2005, largely because of advancements in extraction technology. These technological improvements are relatively new, so their exact long-term impact on U.S. production is currently unclear. However, in the short term, this increased production has caused domestic prices to decrease substantially.
To remain profitable, U.S. companies are making plans to begin exports in the form of liquefied natural gas (LNG), which could lead the United States to become a net exporter of natural gas in the next few years. With prices for natural gas higher in East Asia and Europe, the United States can use these exports as an effective economic and political tool.
Analysis
The United States is the world's largest producer and consumer of natural gas. It produces more than 600 billion cubic meters (bcm) of natural gas annually, but it still needed to import almost 100 bcm in 2011. Beginning in 2005, domestic natural gas production began steadily increasing, and according to projections by the U.S. Energy Information Administration, production will increase by an average of about 1 percent per year through 2035. However, these projections are likely too conservative, having been calculated using production numbers from 2010 and before and thus not having fully taken into account a significant increase in relatively new methods of natural gas extraction from shale formations.
From 2006 to 2011, shale gas production increased by about 50 percent in the United States; by 2010, it accounted for one-quarter of all U.S. natural gas production. Shale gas extraction has been aided by new technologies that have helped exploration and production by lowering operating costs and allowing access to previously untapped formations. These include methods such as hydraulic fracturing, where oil or natural gas deposits are extracted from fractures in underground rock formations, and horizontal drilling, which increases the surface area of a given well in contact with the shale formation. Hydraulic fracturing demands a significant amount of freshwater -- approximately 4.5 million gallons per attempt -- which the United States has in abundance.
As a result of these new technologies, domestic natural gas prices have decreased rapidly as production levels have risen. The benchmark price of natural gas in the United States was about $88 per thousand cubic meters (mcm) March 2, down from about $135 per mcm the previous year and much lower than the prices in the European markets ($409 per mcm) or Japanese markets ($589 per mcm). Low natural gas prices are harming U.S. domestic producers, which need prices to hover around $140 per mcm to remain profitable.
Moreover, natural gas is not the only commodity being extracted from shale formations. Shale oil production in the United States has also seen an increase in production in recent years, and any associated natural gas from oil ventures is sold at prices producers of pure natural gas would consider a loss. The rapid rise in production means accurate numbers are difficult to obtain, but most sources indicate that natural gas associated with shale oil production accounts for 10-40 percent of all natural gas production.
Several other U.S. industries are also affected by lower natural gas prices. Natural gas fuels approximately one-quarter of U.S. electricity generation, an amount that is expected only to rise as the country moves to decrease dependence on coal. Natural gas is also used as a base material for numerous manufacturing operations in the petroleum, plastics and chemical industries, and anywhere from 5 percent to 15 percent of these operations' expenses can be attributed to natural gas costs.
Lower natural gas prices could prompt manufacturing plants to remain in or move to the United States for production, as evidenced by Dow Chemical Co.'s recently announced intent to build its first new U.S. plants since 2001. Royal Dutch Shell announced in 2011 plans to build a new plant in the Appalachian region. Additional interest to increase production in the United States has been expressed by numerous other companies, including Formosa Plastics Corp., Chevron Phillips Chemical Co. and Occidental Chemical Corp.
Obstacles to Exporting
If production continues to increase beyond any increasing demands, the next logical step would be to start exporting natural gas, but this presents a logistical problem. The simplest way to transport natural gas is via pipeline, and while the United States has pre-existing natural gas collection and distribution systems for relatively easy domestic transport, its physical separation from markets in Europe and Asia, where the cost of natural gas is higher, makes exporting to those regions difficult.
LNG is one option for export, but the United States currently has only one, small, old liquefaction plant, inconveniently located in Alaska. At least seven new sites have applied to the Department of Energy to be allowed to liquefy and export natural gas, and two of these, in Freeport, Texas, and Sabine Pass, La., could be partially online by 2015 or 2016 and have a maximum combined exporting capacity of approximately 30 bcm per year. New liquefaction plants are costly -- the Sabine Pass facility is expected to cost $6 billion -- but higher market prices abroad will help companies recoup their initial investment sooner.
The planning and construction of an LNG export facility can take anywhere from three to seven years, though delays are likely. Concerns over the environmental impact of the LNG plant and associated infrastructure threaten to delay the start of construction for a facility in Jordan Cove, Ore., and with five of the seven planned facilities being located on the coast of the Gulf of Mexico, there is the potential for hurricane damage to delay the construction process. Even without delays, full export capacity will not be reached for years.
Potential Markets
LNG exports are by necessity limited to countries with the capability to regasify the product, but the construction of import terminals is on the rise. Approximately 20 new LNG import facilities currently are under construction worldwide, most in East Asia and Europe. Cheniere Energy Inc., the owner of the Sabine Pass export facility, has already signed export contracts with India, South Korea and Spain, and recent reports have indicated that Japan is interested in procuring natural gas from the Freeport site.
The LNG market currently makes up approximately 30 percent of the overall internationally traded natural gas market and its share is expected to grow. Japan is by far the largest consumer of LNG in the world, and demand is increasing as the country attempts to diversify away from nuclear power. Japan currently is paying more than $450 per mcm, the profit margin of which more than makes up for the transport costs of the long journey from a Gulf of Mexico liquefaction facility.
Europe is also a viable market for new LNG exports as countries such as Germany move away from nuclear energy and the Netherlands, Poland and Lithuania build new regasification facilities. Europe could see U.S. natural gas as an attractive alternative to that of Russia, which currently uses its large market share in the European natural gas supply as political and economic leverage.
The success of LNG exports is dependent on the continued success of shale gas and oil production, but the United States has overcome the technological obstacles to efficient production from these fields. While these technological improvements are new and it is thus difficult to predict their exact long-term impact on U.S. natural gas production, evidence suggests that the United States will become a major LNG exporter in the near future.
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Looking for nat gas investors overseas:
http://www.bloomberg.com/news/2012-03-12/chesapeake-ceo-courts-asians-for-100-billion-resource-energy.html?cmpid=yhoo
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http://www.physorg.com/news/2010-11-algae-biofuels-reality-fast.html
"Even with relatively favorable and forward-looking process assumptions (from cultivation to harvesting to processing), algae oil production with microalgae cultures will be expensive and, at least in the near-to-mid-term, will require additional income streams to be economically viable," write authors Nigel Quinn and Tryg Lundquist of Lawrence Berkeley National Laboratory (Berkeley Lab), which is a partner in the BP-funded institute.
Their conclusions stem from a detailed techno-economic analysis of algal biofuels production. The project is one of the over 70 studies on bioenergy now being pursued by the EBI and its scientists at the University of California at Berkeley, the University of Illinois in Urbana-Champaign, and Berkeley Lab.
The algae biofuels industry is still in its early gestation stage, the new report notes. Although well over 100 companies in the U.S. and abroad are now working to produce algal biomass and oil for transportation fuels, most are small and none has yet operated a pilot plant with multiple acres of algae production systems. However, several companies recently initiated such scale-up projects, including several major oil companies such as ExxonMobil (which a year ago announced a $600 million commitment to algae biofuels technology), Shell (with a joint venture project, "Cellana," in Hawaii), and Eni (the Italian oil company, with a pre-pilot plant in Sicily).
SNIP_____________________________________________________
Engineering designs and cost analysis for the various cases were based on projecting current commercial microalgae production and wastewater treatment processes at much larger scales. They assumed higher productivities due to plausible technological advances. The estimated capital costs for a 250-acre biofuel production system emphasizing oil production were about $21 million, with annual operating costs at around $1.5 million, to produce about 12,300 barrels of oil, giving a break-even price per barrel of oil of $330 (based on an 8 percent capital charge). Increasing the scale of the system to 1,000 acres reduced the break-even price to about $240 per barrel. These prices considered wastewater treatment credits, which reduced costs about 20 percent. Other facilities that maximized wastewater treatment produced fuel at lower cost due to greater treatment revenue. However, the availability of wastewater would greatly limit the national scale of this lower-cost fuel production.
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I want a Mr. Fusion to power my DeLorean!
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Obama administration is called on the carpet for its continuing LIE that the U.S. has only 2% of the world's petroleum reserves. http://www.youtube.com/watch?feature=player_embedded&v=_G6EaJgasV0#! 400 Billion barrels of known reserves available from current technology, 20 times more than deceptive figures used by the Obama administration? http://en.wikipedia.org/wiki/Oil_reserves
Also the corruption and executive bonuses tied to 'green' energy and crony corruption based, failed federal loan guarantees.
This really is all about glib-dissonance buy I stick under the energy politics for topic.
http://oversight.house.gov/wp-content/uploads/2012/03/FINAL-DOE-Loan-Guarantees-Report.pdf Corruption and boneheadedness
http://www.youtube.com/watch?feature=player_embedded&v=_G6EaJgasV0#! Rep. Buerkle NY and Sec. Chu, Watch the youtube!
http://www.powerlineblog.com/archives/2012/03/issas-oversight-committee-rips-secretary-chu.php Nice coverage:
March 20, 2012 by John Hinderaker
Issa’s Oversight Committee Rips Secretary Chu
It has been a busy day in Chairman Darrell Issa’s House Oversight and Government Reform Committee. This morning, the committee released a report titled The Department of Energy’s Disastrous Management of Loan Guarantee Programs. The report is a devastating indictment of the Obama administration’s “green” energy cronyism. It documents the extraordinary series of shaky (and sometimes shady) loans that DOE has made, often to administration allies.
You really should read the report in full; it describes how the Obama administration failed to follow its own rules, failed to diversify its investment portfolio, ignored clear signs of impending insolvency on the part of borrowers, and sometimes fraudulently characterized technologies in order to justify loans. This is the beginning of a section titled “Systemic Risks from ‘Crony Capitalism’ and Wasteful Spending:”
There is evidence a number of loan guarantee recipients have engaged in clearly profligate spending. Such wasteful spending threatens the financial viability of the recipient companies, creating risks to both the DOE’s loan commitment portfolio and taxpayer dollars. It is particularly troubling that this waste often takes the form of large cash bonuses to company executives – such payments feed the perception that taxpayer funds are being used to line the pockets of green energy executives.
Beacon Power Corp, the second recipient of a § 1705 loan guarantee, paid three executives more than a quarter million dollars in bonuses in March 2010.58 Eighteen months later, Beacon declared bankruptcy, leaving taxpayers to repay the loan. Adding insult to this injury, these bonuses were explicitly linked to the executives securing the DOE loan guarantee. Similarly, bankruptcy records show Solyndra doled out executive payments just months prior to its late August collapse and early September bankruptcy.59 In Solyndra’s case, former executives have stated that DOE explicitly allowed federal funds to be used to pay out executive bonuses.
Wasteful spending is not limited to executive compensation alone. BrightSource Energy, recipient of a $1.6 billion loan guarantee to build a solar generation facility, has spent more than $56 million on a desert tortoise relocation program.62 Furthermore, BrightSource will build 50 miles of intricate fencing, at a cost of up to $50,000 per mile, designed to prevent relocated tortoises from climbing or burrowing back into the solar generation facility.63 BrightSource has indicated that the exploding cost of tortoise relocation program threatens to derail the entire $1.6 billion project – leaving taxpayers on the hook for the enormous sums on money spent on construction thus far.
The Committee’s report also takes us behind the “green revolving door” and sheds light on corruption in the Obama administration:
Nancy Ann DeParle, the current Deputy Chief of Staff for Policy in the White House, had a financial stake in the success of Granite Reliable, which received $168.9 million loan from DOE. Prior to joining the White House, DeParle was a Managing Director of multi-billion dollar private equity firm CCMP and she both had a financial interest in and sat on the Board of Directors for Noble Environmental Power, LLC.178 Noble owned Granite Reliable, a wind energy project.179 Prior to her departure, her position on Noble’s board of Directors positioned her to understand the most confidential and material aspects of Noble Environmental and its subsidiary Granite Reliable. DeParle misrepresented her relationship with Noble Energy, claiming on disclosure forms that her interest had been divested, when in fact it had merely been transferred to her 10 year old son.180
Energy Secretary Steven Chu testified before Issa’s committee this morning and was grilled by some of the Republican members. Here, Ann Marie Buerkle of New York blasts the administration’s false claim that the U.S. has only 2% of the world’s oil reserves and therefore can’t begin to meet its energy needs by domestic production:
In this clip, Trey Gowdy of South Carolina asks Chu about his wish, expressed in 2008 just before he was named Secretary of Energy, that the government should “boost” gasoline prices to European levels. A visibly uncomfortable Chu explains that this was his opinion as a private citizen, but that since he became Secretary of Energy he has not pursued policies designed to increase prices:
I don’t believe him for a moment, but one wonders, in any event, why anyone would appoint a Secretary of Energy whose expressed desire is that energy costs rise, thereby impoverishing the American people.
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Doug it is ok here but don't go on CNN and use that word. [Well maybe it would be ok if it was a Republican.]
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If I remember correctly Beacon was a favorite of the Huber-Mills "Powercosm" off-shoot from George Gilder in the year 2000. Pretty nifty technology having to do with flywheels keeping the quality of electricity high. It surged after being picked by Huber-Mills. I was amongst those that stayed too long at the party and lost money. Now, twelve years after I was the fool, Team Obama catches up with me.
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http://townhall.com/columnists/victordavishanson/2012/03/22/faithbased_energy_policy/page/full/
Obama's knowledge of U.S. reserves is 20 years out of date. In the first three years of his administration alone, new finds offshore, in Alaska, in the Gulf of Mexico, and in unexpected places such as North Dakota, Pennsylvania, New York and Ohio have revolutionized America's energy future in ways undreamed of just a few years ago. We probably have 100 years of natural gas supplies at present rates of consumption and could cut our imported oil by 50 percent in a few years.
Even Obama does not believe his own dismissals of the role of global supply and demand in setting energy prices. In a tight world oil market, just a few million more barrels a day produced anywhere -- or even the indication that a major producer like America might soon put 2 million or 3 million more barrels a day on the market -- can help to stabilize prices. That's why Obama is considering tapping oil daily from the Strategic Petroleum Reserve while asking the Saudis to pump a little more. Does the president believe that more foreign or previously pumped oil would lower world prices in a way newly pumped domestic oil would not?
Technologies like fracking and horizontal drilling have made it possible for Americans to produce their own oil and gas as never before. We can pump oil with less environmental damage than can Venezuela, Mexico and Nigeria. New domestic production would save a near-bankrupt America billions of dollars currently being lost in import costs while cutting security expenses in deploying forces to the Middle East.
New oil development will create thousands of jobs, worry speculators that America will soon release lots of oil on the world market, and provide a window to produce alternative energies without slapdash, Solyndra-like boondoggles.
**Read it all!
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CCP, Yeah, I capitalized the L-word (LIE) trying to make sure I wasn't using this by accident or mistake. I had this argument with JDN about oil reserves. I was wrong he argued because I came to the information through a blog versus his info which came straight from the President and wikipedia. I care about the truth, not the source and the truth is what holds up after more and more people look deeper into it. Rep. Buerkle and GM post take the numbers straight from Obama administration sources. OBAMA IS OFF BY 20-FOLD on a crucial, strategic question. In the US, proven oil reserves is a legal term controlled by the SEC. If you don't have the government permit to drill it, it isn't an oil reserve even if every geological scientist on earth agrees it is oil down there, recoverable oil.
He is wrong just in the fact that he downplays the importance of oil, oil prices and oil reserves. We deserve a President who knows the significance. For the carless Sec. Chu, he had his eye opened to the possibility of how it would hurt someone who happened to require transportation. He could see the significance there - in the hypothetical.
The difference between a mistake and a lie is that, like the Obama's mom health insurance story, they stay with the untruth after they have it pointed out that it just isn't so. Known or should have known, in this case they own and run the agency that proves them wrong - by 20-fold!
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"If I remember correctly Beacon was a favorite of the Huber-Mills "Powercosm" off-shoot from George Gilder in the year 2000. Pretty nifty technology having to do with flywheels keeping the quality of electricity high. It surged after being picked by Huber-Mills. I was amongst those that stayed too long at the party and lost money. Now, twelve years after I was the fool, Team Obama catches up with me."
Pres. Obama's premature exuberance at industries and technologies is a bit reminiscent of Gilder, but with far less effort and knowledge, and he chooses them for the wrong reasons. People in the know tell him these are neat technologies (in need of subsidy). Gilder believed the market would prove him right and if true getting in early is profitable. Obama believes partly that we can get in early because he is smarter than the other people not doing that, but he also has the more fascist view that we don't care what the market thinks because we are control the direction. He is wrong. Where his subsidy and preference picks made no sense or were poorly timed, the federal cash infusion served only to temporarily block that information.
Gilder and Huber-Mills hit winners from time to time. Obama's picks are bad by definition because the good ones do not require public subsidy to succeed.
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http://www.nypost.com/p/news/opinion/opedcolumnists/obama_energy_lies_htZgwdjovVx2R93bTU4ZEK
Obama’s energy lies
Playing politics with gas prices and a pipeline
By JAY AMBROSE
Last Updated: 12:13 AM, March 25, 2012
..."If the American public is dumb enough to buy all that – and I don’t think so – we deserve this guy and the gas prices that come with him."
Full commentary at the link.
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http://online.wsj.com/article/SB10001424052702304177104577305980790538586.html?mod=WSJ_hp_LEFTWhatsNewsCollection
By TOM FOWLER
Two major energy companies are planning to build new pipelines that will move as much as 850,000 barrels of crude oil a day from Canada to refineries along the Gulf Coast by mid-2014, in the latest effort to cope with a surge of oil production in North America.
The separate projects, planned by Houston-based Enterprise Products Partners LP and Enbridge Inc. of Calgary, will compete with TransCanada Corp.'s proposed Keystone XL pipeline, a massive project to move crude from the oil sands of Alberta to U.S. refineries. The Keystone project was delayed late last year after pressure from environmental groups and has become a hot-button topic in the U.S. presidential campaign, with critics of the Obama administration contending that the delay will contribute to high gasoline prices in the future.
Enbridge and Enterprise already operate the Seaway Pipeline, which used to move oil north—from Freeport, Texas, near Houston, to the massive oil storage hub in Cushing, Okla. Last year the companies said they would reverse the flow of that pipeline because a recent surge in Canadian and U.S. oil production has created an overabundance at that location. The reversal will let Seaway move as much as 150,000 barrels a day south to refiners by June 1 and 400,000 barrels a day by early next year by adding new pumping stations.
The companies said Monday they now have enough long-term commitments from new customers to also build a new 30-inch pipeline along the same right-of-way, which will add up to 450,000 barrels per day in capacity by the middle of 2014. Two smaller pipeline projects will connect the Seaway pipeline to Enterprise's storage hub along the Houston Ship Channel and to refineries near Port Arthur, Texas.
Enbridge, which is one of the largest shippers of Canadian crude oil to the U.S. with a capacity of 2.5 million barrels a day, is also going to start work on a pipeline to move oil from its existing Flanagan, Ill., pipeline hub to Cushing. The pipeline, which will run alongside an existing conduit, will have an initial capacity of 585,000 barrels per day.
The Enterprise and Enbridge projects don't face the same hurdles as Keystone XL, like a U.S. State Department review, because the cross-border portions of their pipelines are already built, experts say. But the new pipelines will require approval from the U.S. Federal Energy Regulatory Commission, which oversees how much pipeline owners can charge for moving products, and the U.S. Army Corps of Engineers, which must review the engineering and environmental plans.
While environmental groups have focused most of their efforts on blocking Keystone, they still have concerns about the Flanagan and Seaway projects, said Anthony Swift, a lawyer for the Natural Resources Defense Council.
Crude from oil sands may be more corrosive than other oils and thus make pipelines more likely to leak, Mr. Swift said.
CONT.
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I suppose I could post this on the thread for Newt's presidential campaign , , , but what would be the point? :evil:
Cheaper American Energy
Alternatives Already Here
by Newt Gingrich
Dear Marc,
As President Obama is spending billions of taxpayer dollars to prop up his preferred sources of energy—solar, wind, and algae—American truckers are offering a lesson in transitioning to new sources of fuel in the real world.
Without even being ordered to do so by President Obama, trucking companies are starting to convert parts of their long-haul fleets to natural gas, an American energy source of which we have more than a hundred years' domestic supply. And Clean Energy Fuels, in cooperation with Chesapeake Energy, is investing tens of millions to build more than 150 liquefied natural gas (LNG) stations to service them.
America's truckers and energy producers are doing all of this without half-trillion-dollar loan guarantees from the federal government. They're doing it without the skyrocketing taxpayer giveaways the president has offered his favorite "greenback energy" pet projects.
They're doing it for one simple reason: it makes sense for their bottom lines.
In my newsletter several weeks ago, I wrote of the incredible increase in America's estimated supply of natural gas in the last few years, and the resulting collapse in its price. In 2008, the average price was $7.97 per thousand cubic feet. The spot price last Friday was roughly $2.07. That's about a 75 percent drop in price in just four years, attributable in large part to improvements in technology which have made more gas recoverable than ever before.
With natural gas less expensive relative to oil than it has ever been, many public transportation and urban truck fleets have already converted to Compressed Natural Gas (CNG). And with diesel prices nearing record highs, the rationale for long-haul trucking companies to convert part of their fleets to LNG is more compelling every day.
Fuel is one of the highest costs for any transportation business today, and the rising cost of oil is taking a toll on trucking companies that are heavily dependent on diesel. Since natural gas is now a dramatically cheaper alternative, companies that convert part of their fleets are discovering they have a growing price advantage over competitors that refuse to make the leap. Jeff Dillon, the founder of Dillon Transport, which owns hundreds of trucks and is investing in LNG, told Bloomberg last month that "nobody can beat us on rates right now if we have the [natural] gas component in place."
Many trucking companies will have a hard time resisting competitive pressures to offer LNG-based long haul services when the difference in cost is so immense . Already, UPS is using LNG-fueled trucks on one of its long-haul routes. Heckmann Water Resources is deploying a fleet of 200 LNG trucks for its water tank trucks. And Walmart is testing LNG vehicles for hauling in California.
Energy suppliers and truck manufacturers are racing to meet what they anticipate will be a fast-growing demand for LNG stations and equipment. Chesapeake Energy has invested more than $150 million in Clean Energy Fuels, which is partnering with Pilot to provide LNG refueling at Flying J truck stops across the country, helping to build out America's natural gas highway. Clean Energy plans to have over 70 stations in 33 states by the end of this year, and at least 150 stations in 2013—eventually one every 200-300 miles along the country's major roadways. Long-haul LNG trucks have a range of about 600-800 miles before needing to refuel, so this network will enable LNG trucks to complete cross-country trips.
Despite the long-term incentives for trucking companies to invest in LNG vehicles, the economic downturn has been a drag on the transition. For the 97 percent of trucking companies that are small businesses with 20 or fewer trucks, the current premium for LNG vehicles over diesel can be hard to swallow, even though the economics make sense over the course of the truck's lifetime.
With badly-needed tax reform and 100 percent expensing for American businesses (which would allow companies to write-off new equipment in one year) we can help ease the burden of investing in all new equipment, including natural gas trucks. This simple change would allow businesses to recoup the extra cost of new natural gas trucks faster—with no federal subsidy. And by reducing demand for oil, a switch to natural gas for freight trucks would put downward pressure on gasoline prices.
There's only one real model for achieving American energy independence, and it's not the president's top-down, bureaucratic greenback energy approach. When we do reach that goal, it will be because of investments like those the trucking and natural gas industries are already making right under the president's nose.
Your Friend,
Newt
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Today, Senators David Vitter, Jeff Sessions and John Cornyn called Obama on his lies in the form of a letter to Secretary of the Interior Ken Salazar. Their indictment is devastating:
Dear Secretary Salazar:
We are concerned with the veracity of statements you made in recent weeks regarding domestic energy production on our federal resources. These statements are similar to claims made by other members of the Administration including the President himself. As you may know, the federal government owns almost 2.5 billion acres of mineral estate, an area larger than the entire land mass of the United States. As director of the Bureau of Land Management, Robert Abbey, testified this month, oil production on our federal property is actually down 14% and offshore production from federal areas is down 17% from only a year ago. Just last week, the Congressional Research Service issued a report revealing that 96 percent of the increase in domestic oil production since 2007 has occurred on non-federal lands. It further revealed that in 2011 production on federal public lands has actually declined by an average of 275,000 barrels per day. Oil production on private lands is indeed up year-over-year, but the Administration does not manage private lands and should not attempt to take credit for private market decisions.
Oil production on federal lands increased in 2009 and 2010 as a result of leasing and permitting decisions made before your Administration took office. However, the falloff in leasing and permitting actions under the Obama Administration is apparent, and even your own Energy Information Administration anticipates continued falloff in production in 2012 and beyond.
We also ask that you rectify the President’s claim that we only have 2% of the world’s oil. Nothing could be further from the truth, as even the Washington Post reported last week.[1] He bases this statement on U.S. “proved reserves” but the U.S. Energy Information Administration has stated that proved reserves is “not an appropriate measure for judging total resource availability in the long-term.” As Secretary of Interior, surely you are aware of the vast oil resources we possess both onshore and offshore that are currently off limits due to this Administration’s combined actions. America is endowed with resources that exceed a TRILLION barrels of oil.[2]
According to the Institute for Energy Research, “USGS estimates that unconventional U.S. oil shale resources hold 2.6 trillion barrels of oil, with about 1 trillion barrels that are considered recoverable under current economic and technological conditions. These 1 trillion barrels are nearly four times the amount of oil resources as Saudi Arabia’s proven oil reserves.
We provide the following examples of what we would view as further inaccurate statements by the Administration regarding the state of federal energy production and resources:
1. Claim: “Expanding offshore oil and gas production is a key component of our comprehensive energy strategy to grow America’s energy economy, and will help us continue to reduce our dependence on foreign oil and create jobs here at home.” Secretary Ken Salazar, DOI Press Release 1/26/2012
Fact: You made the two most pivotal decisions to shrink domestic offshore energy production over the last three years that could have been made. First, you eliminated the 2010-2015 OCS lease plan that would have opened areas of the Atlantic, four geologic basins off S. California, one geologic basin off N. California, while expanding areas in Alaska, including the Cook Inlet. Instead, you have proposed a new 5-year plan that excludes all of the areas of the OCS where the moratorium was lifted in 2008, and reduces the number of planned lease sales by roughly half. Essentially, the moratorium lifted by President Bush and a Democrat Congress in 2008 will continue in effect for a decade under your plan.
2. Claim: The proposed 5-year offshore lease plan will “make more than 75 percent of undiscovered technically recoverable oil and gas estimated on the OCS available for development.” Secretary Salazar, DOI Press Release 11/08/2011
Fact: These numbers distort the facts. The Outer Continental Shelf (OCS) is 1.76 billion acres. Of that 1.76 billion, less than 35 million acres are actually leased (less than 2%). Your proposed 5-year lease plan does not open a single new lease planning area, and therefore we have no way of knowing what estimates of “technologically recoverable” oil in all of the areas that remain off limits are because you have chosen to keep them off limits. Most of our OCS has not been explored for decades, and providing access to only a fraction gives us no clue what is truly there.
A more accurate statement is that your 5 year plan opens 75% of the oil and gas in areas where we think it exists because we have drilled there. We don’t know about the vast majority of the OCS that isn’t leased, much of which has not been assessed with the benefit of new information for a quarter century.
3. Claim: “Since we put in place new safety standards in the wake of the Gulf oil spill, we have approved more than 400 drilling permits. In fact, we are now permitting at levels seen before the spill, all while meeting these important new standards.” Secretary Ken Salazar, 3/12/2012
Fact: There exists no evidence that permitting for production has indeed reached pre-moratorium levels. In fact, the families impacted in the Gulf are still reeling from the impacts of the slowed pace of permitting. Exploration and permitting have yet to recover to pre-2010 levels on account of the moratorium and ensuing permitorium on shallow and deepwater permits. According to one recent study, “Prior to the deepwater drilling moratorium, the U.S. oil and natural gas offshore industry was forecasted to grow significantly due to identified prospects, mostly in the deep water. With the establishment of the moratorium and the subsequent slowdown in the issuance of drilling permits at all water depths, an estimated $18.3 billion of previously planned capital and operational expenditures did not occur in 2010 and 2011.”[3] The study further concludes that the permitting challenges have already cost 90,000 jobs. It is of importance to note that the moratorium was never endorsed by the National Academy of Engineers, as you had attempted to represent. An Inspector General investigation was required to uncover the political influence and misrepresentation by the White House and your office in an important scientific document.
4. Claim: “The fact of the matter is that we are producing more from public lands, both oil and gas, both onshore as well as offshore, than at any time in recent memory. And when you look back at the years of 2009, 2010, and 2011, we’ve continued to make millions and millions of acres of the public estate available both on the land, as well as on the sea.” Secretary Ken Salazar, 3/12/2012
Fact: As we pointed out earlier in this letter, there is significant lag time to production after the process of leasing. Presumably this is the reason for your repeated observation that “there is no immediate fix” for higher gas prices. After a company has leased property they then have to explore, develop and produce, with each stage requiring new permits and compliance with federal processes. The production gains we saw in 2009 and 2010 were the result of leasing and permitting that occurred in the Clinton and Bush Administrations, and was just beginning to come online. However, by 2011 we began to experience the impacts from the moratorium and falloff of leasing and permitting under your leadership. Total oil production on federal lands is down 14% over the previous year, offshore is even worse at down 17%, and federal lands saw the fewest number of new onshore leases since 1984. You also failed to hold a single offshore lease sale in fiscal year 2011.
As a further example, in 2008 the industry spent $2.6 billion to obtain 487 leases in the Chukchi Sea for production offshore Alaska. So far, not a single well has been drilled on any of these leases. There have also been numerous new regulatory roadblocks and permit withdrawals from federal onshore production since you took over leadership of the Agency. Examples of onshore leasing challenges include your withdrawn and slowed leasing in the West, including Montana and the Dakotas.
In July of 2008, then as a United States Senator, you had an opportunity to support increasing domestic energy production, if the price of gas increased beyond a certain threshold. You repeatedly objected to increasing domestic energy production, even if the price of gas were to have reached $10 per gallon.
Although gas prices are not $10 per gallon, they are increasingly impacting our economy and fellow Americans, particularly low-income and middle-class families. We are hopeful that similarly to Secretary Chu, you have reevaluated your position on gas prices and will redirect your efforts to alter what the agency has done to limit future production, and will instead work to develop our truly vast domestic oil resources, resources that well exceed “2%” of the world’s oil.
[1] http://www.washingtonpost.com/blogs/fact-checker/post/pinocchios-obama-gets-a-downgrade-romney-an-upgrade/2012/03/21/gIQAX7uPSS_blog.html#pagebreak
[2] NORTH AMERICAN ENERGY INVENTORY, Institute for Energy Research, December, 2011. http://www.instituteforenergyresearch.org/energy-overview/oil-shale/
[3] The State of the Offshore U.S. Oil and Gas Industry, An in-depth study of the outlook of the industry investment flows offshore, Quest Offshore Resources, Inc., December 2011.
Sincerely,
Jeff Sessions
David Vitter
John Cornyn
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Of all the reasons why it is imperative to bring the Obama administration to an end in January, its pervasive dishonesty is near the top of the list. - JohnHinderacker, Powerlineblog
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Now THAT is some fighting spirit!!! :-D 8-) :-D 8-) :-D 8-) :evil: :evil: :evil:
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"its pervasive dishonesty"
Wow - almost the "L" word!
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I suppose I could post this on the thread for Newt's presidential campaign , , , but what would be the point? :evil:
Well, you may end up being his last campaign worker! :-D
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Would that mean I get to be in a foto with him without paying $50?
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Would that mean I get to be in a foto with him without paying $50?
Probably not, but you'll get a coupon for 5% off his next book when he does a signing in a nearby SoCal Barnes and Noble.
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http://online.wsj.com/article/SB10001424052702303404704577313741463447670.html?mod=us_news_newsreel
By DANIEL GILBERT And RUSSELL GOLD
The Environmental Protection Agency has dropped its claim that an energy company contaminated drinking water in Texas, the third time in recent months that the agency has backtracked on high-profile local allegations linking natural-gas drilling and water pollution.
On Friday, the agency told a federal judge it withdrew an administrative order that alleged Range Resources Corp. had polluted water wells in a rural Texas county west of Fort Worth. Under an agreement filed in U.S. court in Dallas, the EPA will also drop the lawsuit it filed in January 2011 against Range, and Range will end its appeal of the administrative order.
A pond near water wells that the EPA had said were polluted by natural-gas drilling in Parker County, Texas. The agency dropped its claim Friday.
In addition to dropping the case in Texas, the EPA has agreed to substantial retesting of water in Wyoming after its methods were questioned. And in Pennsylvania, it has angered state officials by conducting its own analysis of well water—only to confirm the state's finding that water once tainted by gas was safe.
Taken together, some experts say, these misfires could hurt the agency's credibility at a time when federal and state regulators seek ways to ensure that natural-gas drilling is done safely.
A growing number of industry, academic and environmental experts say that while drilling can cause water contamination, that can be avoided by proper use of cement seals and other safety measures.
By year's end, the EPA is set to release initial results of a study on the impact on water of hydrofracturing, or fracking, which involves using a high-pressure mixture of water, sand and chemicals to break apart energy-rich rocks. State officials contend they are in a better position to evaluate drilling procedures and safety in their areas, but they have been accused of laxity by environmentalists and local governments officials.
EPA officials declined to comment on their broader efforts to regulate gas drilling. But in a statement, the agency said that settling with Range "allows EPA to shift the agency's focus in this particular case away from litigation and toward a joint effort on the science and safety of energy extraction." The agency said it and Range would continue to monitor water wells and share data.
CONT>
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Fuel to Burn: Now What?
By JAD MOUAWAD
Published: April 10, 2012
THE reversal of fortune in America’s energy supplies in recent years holds the promise of abundant and cheaper fuel, and it could have profound effects on what people drive, domestic manufacturing and America’s foreign policy.
Cheaper fuel produced domestically could reduce the cost of shipping and manufacturing, trim heating and cooling bills, improve the auto market and provide tens of thousands of new jobs.
It might also pose new environmental challenges, both predictable and unforeseen, by damping enthusiasm for clean forms of energy and derailing efforts to wean the nation from its wasteful energy habits. But for Americans battered by rising gasoline prices, frustrated by the dependence on foreign oil, skeptical of the benefits or practicality of renewable fuels and afraid of nuclear power, the appeal of plentiful domestic oil and gas could far outweigh the costs.
Just a few years ago, the dominant theme in discussions about energy was of declining production and the fear of running out of oil. Even today, political tensions in the Middle East, particularly in the Persian Gulf, have fanned fears of supply disruptions that are keeping prices high. But a new boom in energy production in recent years has upended these expectations in record time. High energy prices led to a wave of successful oil and gas exploration in North America, including in fields that were deemed uneconomical only a few years ago. Using techniques like horizontal drilling and hydraulic fracturing, oil companies are tapping into deeply buried reserves in shale rocks and in the ocean’s depths.
The surge in energy prices, along with a recession and new government rules that tightened fuel-economy standards, led to a sharp cutback in gasoline consumption. This decline in demand in the last five years reversed decades of almost uninterrupted growth that made the United States the world’s top energy consumer, accounting for one in every four barrels of oil burned around the globe.
The North American energy revival is primarily the result of so-called unconventional sources of energy — like shale oil and shale gas across the United States, oil sands in Canada and deepwater production in the Gulf of Mexico. In the last five years, the United States and Canada combined have become the fastest-growing sources of new oil supplies around the world, overtaking producers like Russia and Saudi Arabia.
“The transformation unfolding in North America represents a potentially decisive shift in the history of energy,” Rex W. Tillerson, the chairman and chief executive of Exxon Mobil, who is not usually given to hyperbole, said in a speech in Houston last month. Ed Morse, head of global commodity research at Citigroup and a longtime energy analyst, says North America has the potential to become a “new Middle East.”
“The reduced vulnerability of North America — and the world market — to oil price spikes also has deep consequences geopolitically, including the reduced strategic importance to the U.S. of changes in oil- and natural gas-producing countries worldwide,” Mr. Morse said in a recent 92-page report called Energy 2020. ”Pressures towards isolationism in the U.S. will likely grow, with consequences for global stability that can only just begin to become understood.”
“The only thing that could stop this is politics — environmentalists getting the upper hand over supply in the U.S., for instance,” the report said.
The new supplies ensure that the United States will remain well entrenched in oil, but the continuing reliance on fossil fuels also carries significant environmental concerns — whether from the risk of offshore drilling, or the hazards, many still unknown, of hydraulic fracturing. It also means that greenhouse gas emissions will most likely increase, at least until carbon emissions are capped or new technology to store carbon dioxide underground is developed.
The glut of natural gas supplies cuts two ways on emissions. It has effectively put an end in the United States to any new investment in coal plants, which produce much more emissions. But it also makes the economics of alternative, noncarbon energy sources like wind power or solar power difficult to justify without public support and subsidies.
Regardless of the environmental impact, there is no guarantee that new supplies will inevitably lead to lower gasoline prices, as proponents of unfettered domestic drilling argue. Oil is a global commodity with a price set on the global market. With rising demand around the world, particularly in emerging economies, and instability in many oil-producing countries, many analysts predict global oil prices will remain volatile — and high — for many years to come.
And with gasoline prices above $4 a gallon, the nation’s energy resources remain a polarizing topic, pitting Republicans against Democrats, environmentalists against oil companies, and conservationists against advocates of unfettered drilling.
Page 2 of 4)
“It is remarkable how quickly perceptions have changed,” says Guy Caruso, the administrator of the United States Energy Information Administration from 2002 to 2008, who is now at the Center for Strategic and International Studies. “We may be in the early stage of this transformation, and clearly things could still go wrong.”
Energy production is an inherently risky business, but recent history suggests that when resources are available they end up being developed.
After the explosion of BP’s deepwater well two years ago in the Gulf of Mexico, leading to the biggest oil spill in American history, the Obama administration imposed a moratorium on offshore drilling. But it took only about a year for exploration and production to resume offshore.
Cheaper energy costs — particularly for natural gas — would benefit a variety of domestic industries, like chemicals, pharmaceuticals and fertilizers. The rise in natural gas production has already led many utility companies to shift their electrical production away from coal; it also calls into question talk of a nuclear revival in the United States.
Economists say that ample gas supplies might also provide the basis for a resurgence of American manufacturing, which has been battered by high energy costs for much of the last decade.
Natural gas prices have fluctuated wildly in recent years, rising to $14 for a thousand cubic feet from $2 within a few years. The current glut, however, has driven prices back down again, to near $2 for a thousand cubic feet. With America becoming one of the top natural gas producers, some domestic companies might rethink moving parts of their business to countries with cheaper energy costs. (At current consumption rates, American gas reserves would last at least 75 years, an estimate some experts say is conservative.)
Lower natural gas costs would also have cascading benefits to other commercial sectors, like retailing. Shipping costs may be lower, particularly if transportation companies shift their fleets to natural gas-powered or electric vehicles. FedEx, for instance, has already been adding clean energy trucks to its fleet, including hybrid and all-electric delivery trucks in cities like Chicago.
Citigroup estimates that as many as 3.6 million new jobs might be created by 2020 thanks to the energy boom. The current trade deficit might fall by 60 percent by the end of the decade from today’s level, according to the bank’s estimates, and the dollar could appreciate by as much as 5.4 percent as imports shrink.
“In a world of high energy prices, the potential economic activity generated by this wave of new hydrocarbon production is extraordinary and should strongly boost national output, increase incomes, create wealth, stimulate consumption and create jobs,” according to Citigroup.
Given how swiftly expectations have shifted to describe America’s energy prospects, however, some caution may be warranted.
Opposition from environmental groups and concerns about climate change — which is caused by increased carbon emissions from fossil fuels — could lead to tighter regulation of petroleum products or derail infrastructure projects like pipelines.
That is what has happened to the extension of the Keystone XL Pipeline, which its supporters say is needed to increase the import of oil from Canada’s oil sands into the United States. That project has faced stiff opposition from environmental groups because oil sands are more energy-intensive and emit more carbon dioxide into the atmosphere than traditional oil sources.
The increased reliance on these unconventional oil sources, including oil sands and shale oil, has led some energy experts to talk about a “re-carbonization” of energy supplies if that reliance distracts from the need to develop renewable fuels.
“As we run out of conventional fossil fuels, we face some fundamental choices,” said Dan Lashof, the climate program director at the Natural Resources Defense Council. “Are we going to switch to cleaner energy sources, or are we going to switch to dirtier energy sources? That’s why the Keystone pipeline was so hard fought. It’s because we face a real fork in the road. And depending which way we go, solving our environmental problems might become impossible.”
Page 3 of 4)
Environmental groups are also concerned about the effects on underground aquifers of hydraulic fracturing — in which water under high pressure is used to break apart shale rocks to release natural gas.
While natural gas emits less carbon dioxide than coal when burned for electrical production, which has led producers to try to brand it as a “clean” energy source, it remains a fossil fuel that emits carbon into the atmosphere when burned. Because it is suddenly plentiful, and relatively cheap, doubts have been raised about future investments in renewable power sources that had been favored to replace coal.
“Cheap natural gas has delivered significant near-term environmental benefits, but it clouds the outlook for renewable energy,” said Trevor Houser, a partner at the Rhodium Group, an economic research firm. “Without an extension of current tax credits or adoption of new pro-renewables policy, wind power and other renewable energy sources will have a tough time competing with natural gas in the years ahead.”
Geologists have long known that shale basins across the country, like the Bakken field in North Dakota, Eagle Ford and Barnett in Texas, and the Marcellus in the Northeast, held tremendous oil and gas reserves. But energy companies had no economic way to collect them until new technology recently changed that.
The results have been impressive. Production from the Bakken region alone has gone from negligible quantities to 500,000 barrels of oil a day in just a few years. Production at Eagle Ford produced just 787 barrels in 2004. Last year, its production reached 30.5 million barrels, according to state regulators, and it is still growing. Natural gas production there went from nothing to 243 billion cubic feet in just three years.
The National Petroleum Council, an industry-led group that provides advice to the secretary of energy, recently outlined its view of how the nation’s larger-than-expected resource might be developed.
In a major study released last year, the group forecast that North American oil production might exceed 20 million barrels a day by 2035 under a “high potential” situation of unfettered access.
However, under a “limited” situation where production was constrained for a variety of environmental or political reasons, domestic supplies might fall to less than 10 million barrels a day.
Some experts are more bullish. Mr. Morse of Citigroup forecast that North American oil production could reach an astounding 27 million barrels a day by 2020, almost twice the rate of production of 15 million barrels a day at the end of 2011. Production from the United States could grow to 15.6 million barrels a day by 2020, up from nine million barrels a day in 2011.
If that trend continues, the growth in oil and natural gas supplies in the next decades could turn the United States into a top energy exporter, rivaling some members of the Organization of the Petroleum Exporting Countries. Natural gas could be sold to Mexico and Canada (because exploiting oil sands is so energy-intensive, Canada might have to import natural gas to produce its oil). Refined petroleum products, and even crude oil, could find customers in Europe and Latin America. Coal could be exported to China.
With less gasoline demand, the nation’s surplus refining capacity means the United States is already exporting petroleum products — like gasoline and diesel. The United States is now the top exporter of refined products, just ahead of Russia.
The United States has been a net oil importer since the middle of the last century. America’s dependence on imports grew as the country’s consumption rose and domestic production dropped, and reached a peak in 2005. That year, domestic consumption of oil was about 21 million barrels of oil a day — a quarter of global oil demand. More than two-thirds of that was imported.
But this was most likely the high-water mark for oil imports, at least in the foreseeable future. The nation’s oil consumption has since fallen by about three million barrels a day as consumers cut back on their gasoline use.
Analysts say this trend is actually deep-seated, and is likely to continue. Americans are buying fewer cars, and they are driving shorter distances. The average distance traveled peaked at 12,500 miles a year in 2003, according to Citigroup, and could fall to 11,600 miles a year by 2020.
Page 4 of 4)
At the same time, federal fuel-efficiency standards are being tightened. The Obama administration and automakers last year agreed to new fuel-efficiency targets, aiming to raise the Corporate Average Fuel Efficiency, or CAFE, standard to 54.5 miles per gallon by 2025, with the goal of saving 12 billion barrels of oil over the life of the program.
Political attitudes, once hard and fast, are undergoing a transformation.
“For 20 years, Democrats opposed opening public lands to oil production and Republicans opposed increases in fuel economy standards, but the run-up in oil prices shattered all that,” said Paul W. Bledsoe, a senior adviser at the Bipartisan Policy Center, a research group in Washington. “The shift in politics was amazingly swift. As was the change in psychology, where the United States was viewed as an energy-depleted nation, to the view now of an energy-rich superpower.”
The rise in fuel efficiency in conventional vehicles, along with the growing popularity of hybrids, could also mean all-electric cars will struggle to gain much market share, according to a report released last year by the Boston Consulting Group. In fact, the report found that by 2020, electric cars in the United States would account for a lower share of the market than in either China or the European Union, where they are likely to benefit from government support.
Assessing falling American dependence on foreign oil, analysts with the financial firm Raymond James said imports fell from 65 percent of demand, or 13.5 million barrels a day, their peak in 2005, to 9.8 million barrels a day in 2011, or 52 percent of demand. They predicted that imports would keep falling, reaching 4.5 million barrels a day — or just a quarter of domestic oil demand — by 2015. By 2020, they forecast, the United States would not need to import foreign oil anymore.
“The resulting savings from the standpoint of the trade deficit are highly meaningful,” the analysts said, “especially when the benefits of cheaper energy for domestic manufacturing are taken into account. Maybe the real question is, When will Washington apply to join OPEC?”
While the question is provocative, the change in outlook for domestic supplies, along with the changed role of the United States in global energy markets, carries important economic and geopolitical lessons.
Nationalism over natural resources in countries like Venezuela, Russia and much of the Middle East has increasingly forced Western oil companies to look for oil and gas closer to home. And exports are already shrinking for many OPEC producers as their own domestic demand soars — a result of energy subsidies that keep prices artificially low.
It is still too early to get a clear sense of the political implications of this reduced reliance on oil from places like the Middle East. Four of the top five sources of foreign oil to the United States are already outside the Middle East — Canada, Nigeria, Venezuela and Mexico. The fifth is Saudi Arabia.
James Brick, an energy analyst with Wood Mackenzie, a research firm, said in a recent report that by 2030 the United States could end up exporting 500 million tons of coal a year, 3.2 billion cubic feet a day of natural gas and 2.5 million barrels a day of oil products.
“The United States will be playing a very different role on the energy markets, a much more international role and a much more complicated and sophisticated one,” said Mr. Brick. “As with any forecast there are uncertainties but no matter how you cut it, the United States has the resources in the ground.”
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All he is missing is to say - all of the above -should compete evenly in a free market.
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Solar? Wind? Oil and gas? All of the above in Colorado
By Gov. John Hickenlooper 04/24/2012
The gas station near our neighborhood has raised the price of a gallon of gas by nearly 20 cents in just one week. It's the same everywhere. Gas is climbing to nearly $4 per gallon — essentially a job-killing tax on consumers just as we are beginning to see the economy improve.
Like Yogi Berra said, "It's déj… vu all over again." We have seen this play before.
In 1973, responding to our first energy crisis, Gov. John Love left Colorado to become the nation's first "energy czar." His charge in Washington, D.C, was to develop a plan that would help America become energy independent.
Forty years and seven presidents later, our country is finally beginning to achieve domestic energy independence. But as Thomas Friedman said, "The biggest energy crisis we have in our country today is the energy to be serious — the energy to do big things, in a sustained, focused and intelligent way."
It is why the Obama administration is calling for an "all of the above" energy policy that promotes development of a diverse mix of energy resources, including solar, wind, biofuels, natural gas, oil and coal.
An "all of the above" energy strategy makes sense for the country. It also makes sense for Colorado, where we are already leading the way.
Colorado is recognized as a leader in wind, solar and geothermal energy, and for what former Gov. Bill Ritter called the "new energy economy." Colorado is also home to abundant supplies of natural gas and low-sulfur coal.
Colorado was the first state to pass a voter-approved renewable energy standard. We have an ambitious but achievable goal of using 30 percent renewable energy by 2020, giving Colorado one of the nation's strongest renewable energy standards. In 2010, a bipartisan group of legislators approved the Clean Air Clean Jobs Act, legislation that will improve Colorado's air quality by using clean-burning natural gas to generate electricity.
Thanks to the collaborative efforts of industry and the environmental community, Colorado now has the country's strongest public disclosure rule on the process of fracking.
We have partnered with Oklahoma to lead an effort aimed at creating a market for compressed natural gas vehicles, which run cleaner, cheaper and keep jobs and dollars in the U.S. rather than exporting them to foreign dictatorships. Eleven other states have joined in the effort to leverage the purchasing power of state fleets.
Thanks to the bipartisan leadership of Democratic state Sen. Pat Steadman and Republican state Rep. Jon Becker, we have an opportunity in House Bill 1315 to expand the mission of the Governor's Energy Office and recast this agency as the Colorado Energy Office.
The new Colorado Energy Office will promote all types of energy that protect the environment, lower consumer costs and increase energy security. The Steadman-Becker bill will extend funding for the Colorado Energy Office for five years and focus the office on long-term energy projects that have broad job creation potential.
In short, this legislation creates an "all-of-the-above" Colorado Energy Office that builds upon our state's national brand as a leader in energy conservation and renewable clean energy. It will also enhance Colorado's reputation for energy innovation.
The Steadman-Becker bill focuses the state's energy work on promoting innovative energy technology, no matter if the fuel source is wind, gas or coal, as long as that energy can benefit the environment and save consumers money.
Tens of thousands of Coloradans are currently employed in the energy sector, and with sustained focus on promoting energy resources and technologies, the Colorado Energy Office can help grow this diverse industry.
We need this bipartisan legislation to pass the General Assembly this year. The Steadman-Becker bill will help Colorado's economy create jobs and buttress Colorado as a national leader in developing an energy strategy that is both environmentally sensitive and economically sound.
Democrat John Hickenlooper is the 42nd governor of Colorado.
http://www.denverpost.com/opinion/ci_20462697/solar-wind-oil-and-gas-all-above-colorado#ixzz1tB1tpdMr
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The US has increased oil production 15% since 2009, from private sources on private lands, not because the feds opening up drilling leases and permits. The high price makes more types and grades of oil economic to produce, like shale oil from the Bakken formation. http://oilshalegas.com/bakkenshale.html
Meanwhile, the price of oil did not go down. Why not?
Oil is transportable. The market for oil is global. The US produces 11% of the world's oil. A 15% increase is only a 1.5% global increase while all other factors were not held constant.
Natural gas is less transportable. The market therefore is local. With natural gas, the dramatic increases in production resulted in noticeable decrease in price. The law of supply and demand in alive and well.
Do the laws of supply and demand apply to oil? Yes. But a 1% increase is like having a dollar and gaining a penny while your demands are changing. The question is not if increased production will lower prices, but how much increased production will it take to make a positive economic impact. To start with, we should be striving to double our production and then increase it some more until the US produces as much it consumes, and more. Then the US would still be only having a neutral effect on world oil prices. Meanwhile we could be shifting a good portion of our transportation usage over to cheaper and cleaner burning natural gas, further alleviating the demand for oil.
As they said 20 years ago opposing ANWR and the like, that would take 10 years. Yes it would have. The results would come faster today. But world market price is set in futures markets that are based on risks, trends and expectations. As the effort to double production becomes apparent, the impact on the oil futures market would come much sooner.
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Fusion. Still a pipe dream. The scientific theory of how it would work, why it hasn't, and a multinational project that is trying to make it work:
http://www.scientificamerican.com/article.cfm?id=fusions-missing-pieces-iter-problems
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CCP, Interesting stuff. I notice that the Bill Gates "4th generation nuclear" is still a version of fission:
http://dogbrothers.com/phpBB2/index.php?topic=1072.msg61665#msg61665
http://online.wsj.com/article/SB10001424052702304636404577299343742435580.html?mod=WSJ_hpp_MIDDLE_Video_Top
Earlier reports had this as being fusion. I don't think that is right: http://www.smh.com.au/business/nuclear-fusion-bill-gates-joins-forces-with-toshiba-20100323-qt10.html
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http://oilandglory.foreignpolicy.com/posts/2012/05/29/the_skinny_american
When it comes to gasoline, are Americans transforming from the world's chief gluttons to models of moderation? According to Philip Verleger, the energy economist, that is more or less the country's direction, with surprising consequences.
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http://www.theblaze.com/stories/painful-every-step-of-the-way-top-epa-official-inadvertently-tells-the-truth-about-the-white-houses-environmental-agenda/
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The Shale Gas Secret
Why has drilling boomed in America, while it struggles in Europe?
'Whoever owns the soil, it's theirs up to Heaven and down to Hell." So goes the ancient common-law principle. Today, however, almost no major country recognizes full subsurface private property rights, except for the United States.
We mention this because that blessing of American jurisprudence helps explain one of the few bright patches in the Obama economy—the booming production of shale gas and, increasingly, oil. The U.S. ranked 159th in GDP growth last year. But in natural gas production, it's now No. 1.
How did that happen? Partly it's the luck of geology, though plenty of other countries have abundant shale resources. Partly, too, it's American technological leadership in developing hydraulic fracturing (fracking) and horizontal drilling. But those techniques are now widely understood the world over.
What has given the U.S. its edge is that the early development risks were largely borne by small-time entrepreneurs, drilling a lot of dry holes on private land. These "wildcat" developers were gradually able to buy up oil, gas and mineral leases from private owners while gathering enough geological data to bring in commercial producers.
Enlarge Image
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A natural gas site in Fort Worth, Texas
.Take Texas's Barnett Shale, a particularly tight rock formation that had been eluding speculators for years. Houston-based Mitchell Energy & Development Corp. spent the 1980s refining horizontal drilling techniques, and by 1996 it was producing Barnett shale gas.
Jason Dvorin, a partner in the Dallas-based oil and gas leasing and exploration firm Dvorin LLC, recounts that when his father Sanford heard of Mitchell's success, he decided to go all-in, having also spent years chasing Barnett shale. In 1997, father and son began buying individual leaseholds for mineral, oil and gas rights at $25-$50 an acre. By the time they sold their productive leases at the end of 2007, Mr. Dvorin recalls, they were going for as much as $30,000 per acre. "Even today, in a depressed market, operators are still paying $1,500 an acre."
Meantime, some of the property owners who leased their mineral rights to companies like Dvorin have received royalty checks, typically worth at least 12.5% of production value. That's encouraged further leasing and exploration, generated popular momentum for fracking, and brought development to previously depressed regions such as western Pennsylvania and the Bakken area of North Dakota.
Now compare this to Europe, which sits on an estimated 639 trillion cubic feet of shale gas yet remains heavily dependent on Russian imports. The governments of France and Bulgaria have banned fracking on dubious safety grounds, with nary any pushback from their publics. That might not be the case if French farmers, for example, were able to profit from the riches underneath their terroir.
Countries such as Poland and Great Britain are willing to develop their shale potential. Yet in both places the absence of private mineral rights has delayed exploration and production.
In 2008, U.K.-based Cuadrilla Resources obtained a license to explore underneath some 297,000 acres of Lancashire countryside. It has since been completing its tests, negotiating surface-use agreements with landowners, and wading through the planning, health and safety approvals it needs before it can finally apply for a license to produce and commercialize the gas. Those final negotiations will take at least a year, once they commence in mid-2013.
As for Poland, Exxon Mobil recently abandoned a large regional concession there when its two test wells didn't meet expectations. For a company of Exxon's size, it may not be profitable to spend time drilling a lot of dry wells in Poland when it can focus on more established and "de-risked" prospects elsewhere. But smaller developers might be willing to take risks and explore the geology a little more thoroughly—if only they could gain private title to the resources.
In time, perhaps even the French will recognize their lost opportunity and lift their ban on fracking. But the deeper lesson is that this is a revolution that came about not through government planning or foresight, but through a combination of individual risk-taking and private property. Europeans could benefit by doing more to broaden the latitude for both.
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Essential Liberty
"Horizontal drilling and fracking have made oil shale and tar sands rich sources of oil and natural gas, so much so that the United States may prove to possess the largest store of fossil fuel reserves in the world -- in theory, with enough gas, oil and coal soon never to need any imported Middle Eastern energy again. 'Peak oil' is suddenly an anachronism. Widespread American use of cheap natural gas will do more to clean the planet than thousands of Solyndras. If the United States utilizes its resources, then its present pathologies -- massive budget and trade deficits, mounting debt, strategic vulnerability -- will start to subside. These new breakthroughs in petroleum engineering are largely American phenomena, reminding us that there is still something exceptional in the American experience that periodically offers the world cutting-edge technologies and protocols. ... Who would have thought that a few fracking innovators in Texas would change the world's carbon footprint far more than did Nobel laureate Al Gore -- while offering a way for the U.S. to be energy-independent." --historian Victor Davis Hanson
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Crafty's previous post: "Who would have thought that a few fracking innovators in Texas would change the world's carbon footprint far more than did Nobel laureate Al Gore -- while offering a way for the U.S. to be energy-independent." --historian Victor Davis Hanson
Washington Post 7/21/2012:
In the past few years, the shale gas boom has upended the U.S. energy landscape. With large and small companies drilling wells around the country, cheap natural gas is now displacing coal as the nation’s top source of electricity. That, in turn, has helped contribute to a drop in U.S. carbon-dioxide output: According to the International Energy Agency, the United States has cut its emissions 7.7 percent since 2006, more than any other country or region in the world.
http://www.washingtonpost.com/blogs/ezra-klein/wp/2012/07/21/will-the-u-s-export-fracking-to-the-rest-of-the-world/
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(The other cause of lowered emissions is the Great Recession.)
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"According to the International Energy Agency, the United States has cut its emissions 7.7 percent since 2006, more than any other country or region in the world."
That is a great datum.
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Climate Change This Week: The Other Polar Ice Cap
The Arctic Ocean will be entirely ice-free within four years -- or so predicts Cambridge Professor and "ice expert" Peter Wadhams. He says that this summer's new record-low sea ice extent of under 3.5 million square kilometers is but a taste of the "global disaster" coming. "I have been predicting [a complete collapse] for many years," warns Wadhams. "The main cause is simply global warming." Within a few years, he says, a complete breakdown of sea ice will lead to an ice-free Arctic. But freeze -- there are three major points that need to be made clear.
First, major ice melt in the Northern Hemisphere was entirely expected and can be directly attributed to natural causes. WeatherBell Meteorologist Joe Bastardi provides the many reasons for the unfavorable environment, which include different phases of the Pacific Decadol and Atlantic Multidecadol Oscillations: "The earth's temperature rose in response to the warming Pacific, which started the northern ice cap melting. The Atlantic is in its warm stage now, so the ice cap is being attacked from the ocean also. Once the Atlantic comes out of its warm phase in 10 to 15 years, the ice cap will rebound." In other words, it's called "nature."
Second, open waters in the Arctic are well documented. Bastardi provides photographic evidence of submarines surfacing at the North Pole. The first picture shows a single submarine in August 1959 and the other depicts three subs in the open waters in May 1987. So much for "unprecedented."
And third, no one seems to be looking at what's happening in Antarctica. As Steven Goddard of Real Science points out, "Antarctica currently has the most sea ice ever recorded for the date, which is 17,000 Manhattans larger than the greatest amount of sea ice ever recorded in the Arctic." He quips, "Most geographers actually consider the southern hemisphere to be part of the globe."
All sarcasm aside, what's happening in the Southern Hemisphere is equally impressive, if not more so, than what's happening in the North when taking into account the continent's mass. As Bastardi summarizes, "A nation built on the freedoms to confront reality will not survive if shackled by policies that chase utopian ghosts."
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"Most geographers actually consider the southern hemisphere to be part of the globe."
Very funny line.
I watched the IMAX movie to the Arctic, a beautiful movie about Arctic life, Polar bears in particular. It is narrated by Merly Streep with nonstop liberal extremist messages and no mention that the population of Polar bears is increasing or that the Antarctic is gaining ice. While they fly endlessly to produce propaganda for us, we should stay home and get used to doing without energy was the message
http://www.imax.com/tothearctic/
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http://online.wsj.com/article/SB10000872396390444549204578020602281237088.html?mod=WSJ_hps_LEFTTopStories
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Electricity and gas is a top need and priority after interruption in the wake of the storm. http://www.bloomberg.com/news/2012-11-01/obama-tours-n-j-storm-damage-as-restoring-power-takes-priority.html
Who knew?
Energy is always a top priority, except for when we take it for granted.
Meanwhile Al Gore is saying energy consumption caused the storm:
http://www.huffingtonpost.com/al-gore/statement-on-hurricane-sa_b_2045406.html
Scientists tell us that by continually dumping 90 million tons of global warming pollution into the atmosphere every single day, we are altering the environment in which all storms develop. As the oceans and atmosphere continue to warm, storms are becoming more energetic and powerful. Hurricane Sandy, and the Nashville flood, were reminders of just that.
George Bush's fault.
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Hey, it's good news! Think of all the carbon fuels not consumed and europe-like gas prices. Forward!
Electricity and gas is a top need and priority after interruption in the wake of the storm. http://www.bloomberg.com/news/2012-11-01/obama-tours-n-j-storm-damage-as-restoring-power-takes-priority.html
Who knew?
Energy is always a top priority, except for when we take it for granted.
Meanwhile Al Gore is saying energy consumption caused the storm:
http://www.huffingtonpost.com/al-gore/statement-on-hurricane-sa_b_2045406.html
Scientists tell us that by continually dumping 90 million tons of global warming pollution into the atmosphere every single day, we are altering the environment in which all storms develop. As the oceans and atmosphere continue to warm, storms are becoming more energetic and powerful. Hurricane Sandy, and the Nashville flood, were reminders of just that.
George Bush's fault.
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Merrill on “Fear of Fracking”
from The Volokh Conspiracy by Jonathan H. Adler
(Jonathan H. Adler)
This morning, Columbia’s Thomas Merrill delivered the keynote address at the Case Western Reserve Law Review symposium on “The Law and Policy of Hydraulic Fracturing: Addressing the Issues of the Natural Gas Boom.” His talk, “Fear of Fracking,” sought to addressed four important questions about fracking: 1) Why did fracking technology emerge in the United States rather than somewhere else? 2) Does fracking present any novel environmental risks? 3) Insofar as there are novel risks from fracking, how could they be best addressed? 4) What should a citizen concerned about climate change think about fracking?
These are important questions about an important topic. As Merrill noted, fracking has rapidly emerged as intensely polarizing environmental issue, celebrated by some as an economic and ecological savior and decried by others as a threat to landowners, local communities, and the environment. The Wall Street Journal believes fracking heralds the rise of “Saudi America,” while some environmental groups fear fracking will further feed America’s addiction to carbon-based fuels.
Whatever its ultimate ecological impact, the combination of hydraulic fracturing and horizontal drilling promises to dramatically increase domestic oil and gas reserves, drive down energy prices and fundamentally transform the energy sector. North Dakota now produces more oil than any state but Texas and the oil and gas boom in this state is enriching landowners tremendously. Every president since President Nixon has called for energy independence. Fracking’s rise could make this possible within the next few decades. Beyond that, fracking and the proliferation of cheap gas, Merrill suggested, likely means the end of the nuclear power industry in the United States and has thrown the coal industry into a tailspin. Cheap gas is a bigger threat to coal than any alleged “war on coal” waged by the Environmental Protection Agency. It also threatens the future of alternative energy technologies dependent upon government subsidies for their economic viability.
[My write-up of the rest of Professor Merrill’s remarks is continued below the fold.]
Why did fracking arise in the United States? Contrary to some analysts, Professor Merrill does not believe it is attributable to federally funded research and development. What little funding for drilling technologies the federal government has provided has been fairly tangential. This does not mean federal policy has been irrelevant, however. The federal government has provided special tax credits for the drilling of unconventional natural gas which almost certainly facilitated the early development of the technology as early frackers developed and improved fracking techniques.
Professor Merrill also doubts industry structure has much to do with fracking’s rise either. However much major oil companies like to tout their commitment to innovation, the majors played a minor role in developing this technology. It was largely developed by smaller players in the industry.
A more likely factor is the way U.S. law treats subsurface rights. The U.S. is something of an outlier in that subsurface minerals are the property of the landowner, and not the government. This results in decentralized ownership and control over subsurface rights facilitates experimentation and innovation in figuring out how to exploit and manage subsurface resources.
Further decentralization, and experimentation, results from the federalist regulatory structure. Different states have different regulatory approaches than others, creating opportunities for further innovation and the opportunity for jurisdictions to learn from one another. The existence of a few jurisdictions that will allow a new technology to be tried provides a laboratory from which others may learn, whereas under a more centralized regulatory structure such innovation is unlikely to get off the ground.
The existence of a relatively open infrastructure network – a pipeline system that is subject to common-carrier rules – also plays a role in facilitating entry into the market. These factors have a common theme: decentralization. Taken together, Merrill suggests, they are the most likely source of fracking’s rise in the Unites
Now that fracking is here, does fracking present any novel environmental risks? Insofar as fracking presents the same risks as any sudden surge of production, the traditional regulatory framework would seem up to the task, but is this the case? The biggest environmental risk cited by fracking’s critics is the potential for groundwater contamination by fracking fluid. This may be different in kind from the risks already addressed by existing regulatory programs. Other concerns range from stresses on local infrastructure to increased pollution accompanying development to earthquakes. Fracking has a voracious appetite for water, but this would seem to be manageable, particularly in the eastern United States. Earthquakes, on the other hand, would seem to be a novel concern definitely worth more serious attention, even if it is not unique to fracking.
To Professor Merrill, the potential threat of groundwater contamination is the most serious, and potentially most distinct, environmental threat posed by an upsurge in fracking. While there is little empirical evidence confirming that such contamination has occurred thus far, and energy experts often downplay such risks, concerns about groundwater are understandable. The uncontrolled nature of the subsurface injection in fracking is a source of legitimate apprehension, particularly since many of the potential effects are not fully understood. This counsels the development of some regulatory structure to address these risks.
Accepting that the risk to groundwater posed by fracking is relatively novel, how should it be addressed? In many cases, ex ante regulation of potentially polluting conduct is advisable. In this case, however, the nature and likelihood of the risks in question are not sufficiently known to make such a regulatory approach effective. Over time, consensus views about best practices will likely develop, but they have not yet because not enough is known. Adoption of a precautionary regulatory strategy would likely stop fracking in its tracks, as the problem is lack of knowledge about the technology that will only come from experience.
Under the current circumstances, Professor Merrill thinks the best way to regulate and control the potential groundwater risks from fracking is through an ex post liability system. Professor Merrill would encourage the adoption of a strict liability regime combined with administrative measures to facilitate the identification of and compensation for harms, including mandated baseline testing, bond posting, and the like. Legislative adoption of such a regime is unlikely, Merrill notes, as legislatures are unlikely to enact such a regime absent greater evidence that fracking is, in fact, a meaningful threat, i.e. until real damage is done. Common law tort liability might do, however, particularly if courts impose strict liability, following the lead of Rylands v. Fletcher, and adopt a presumption of causation if producers don’t take adequate ex ante precautions, such as testing water prior to initiating development.
What then about climate change? Does fracking help or hurt efforts to stabilize atmospheric concentrations of greenhouse gases? Over the past five years, GHG emissions in Asia (where coal is the dominant power source) have continued to rise. In Europe, GHG emissions have remained rather stable, despite substantial subsidies and inducement for the use of renewable fuels. In the U.S., by contrast, GHG emissions have fallen. Some of this is due to the economic slump and improvements in fuel efficiency. But some is also due to the dramatic increase in natural gas usage. Declining gas prices, largely due to fracking, have helped displace the use of coal. This is a positive development, but unless similar trends can be replicated elsewhere it will not matter. Unless gas can displace coal overseas as well, the fracking boom will not do much to reduce global emissions, particularly if lower gas prices make it more difficult for renewables to compete.
On the whole, however, Merrill thinks those concerned about climate change should support fracking. While it undermines reliance on nuclear and renewables, cheap gas is a bigger threat to coal, and the displacement of coal is more important to get GHG emissions under control. Further if the development of fracking in the U.S. can be exported to other nations, it could help stem GHG emission increases in other nations with large coal reserves (e.g. China). Ultimately, however, Merrill believes GHG control requires substantial technological innovation, and suggests that a fracking-driven drop in energy prices might facilitate the adoption of policies that could encourage needed innovation, such as the adoption of a carbon tax. Whatever political obstacles there may be to the adoption of such a tax, lower energy prices make such measures more likely, even if only on the margin.
http://www.volokh.com/2012/11/16/merrill-on-fear-of-fracking/
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BBG:
Good piece on several levels. I liked the reasoned tone with regard to concerns over contamination of water table issues.
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"and suggests that a fracking-driven drop in energy prices might facilitate the adoption of policies that could encourage needed innovation, such as the adoption of the carbon tax."
Do we "need" a carbon tax?
Can anyone help me out here?
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http://www.cnn.com/2012/11/23/business/america-shale-gas-ferguson-stevens/index.html?hpt=hp_bn1
From the article:
U.S. energy production has been booming in recent years. The International Energy Agency made a jaw-dropping forecast two weeks ago that the U.S. would pass Saudi Arabia as the world's biggest oil producer by the end of this decade -- and would achieve near energy independence by the 2030s.
That energy boom, asserts Ferguson, will create jobs in the United States. Lots of jobs.
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I too am noticing this. The implications of the change in the energy status of the US are deeply positive, indeed so deep that they will be felt to some extent despite Obama.
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Ten Reasons To Be Concerned About U.S. Energy Independence
Matthew Hulbert Contributor
U.S. energy independence must be about to happen. The International Energy Agency just devoted its World Energy Outlook 2012 to telling us so. America will become the largest producer of oil and other liquid fuels on Earth by 2020; it will be entirely self-sufficient by 2030; and a net exporter by 2035. Boom. Epic stuff.
It would be churlish to deny that U.S. energy growth will provide major economic gains to America — of course it will. Here’s a few hundred pages explaining exactly what they are. But this isn’t going to be a free lunch for America.
We’ll leave aside the fact that IEA forecasts have a strong track record of being universally wrong, or that a month ago they were pinning all their supply side hopes on Iraq coming good to ‘balance’ international oil markets. Minor stuff; but having just flown over the Bosphorus en route to Ankara via Istanbul, believe me, the world looks very different depending on where you’re sat. Here are 10 reasons for the U.S. to be cautious on energy supply growth, irrespective of however the IEA forecasts play out:
1) America Will Never Be The New Saudi Swing
America is never going to be in a position to produce enough liquids to perform the role of swing producer in the oil world. It might notionally overtake Saudi production by 2017, but that hardly leaves it much export margin to play with. U.S. pricing ‘power’ will purely become a function of how much collateral damage it does to other producer states, not dictating how much consumers have to pay at the pumps.
2) Global Pricing Pressures Will Always Influence US Pumps
By the same token, America can never truly escape international pricing pressures affecting broader supply-demand fundamentals. If anything, once the Obama administration gets to grips with significant infrastructure bottlenecks that have led to an inefficient domestic market, WTI benchmarks will increasingly realign with international prices. ‘What happens in the Gulf of Aden still affects what happens in the Gulf of Mexico’.
3) Transitional Friction Will Be Profound
The fact that America has seen such rapacious supply side activity averaging over 500,000b/d in the past four years was good news for President Obama’s re-election, but it’s deeply concerning for traditional producer states. America has played fast and loose with international oil market stability of late, first in Libya, and then in Iran, purely on the back of new oil gains. Assuming U.S. supply growth forces oil under three ($100/b) figures, OPEC states will be in deep political trouble. Supply side outages across producer states will be the result when instability hits. American supply growth will not be in a credible position to settle the markets; consumers will pay a heavy transitional price. The transitional limits of ‘energy independence’ will be clear for all to see, not just in traditional producer states that needed high prices to maintain stability, but a range of new players that all required firm prices to bring difficult fields to the wellhead.
4) U.S. Policy Suffers Structural Paradox
Needless to say, this makes a total mockery of ongoing US external support for oil supplies coming from the Middle East. It makes zero sense for Washington to be paying billions in tax payers’ money maintaining the 5th Fleet in Bahrain only to watch OPEC states internally implode from the prospect of lower oil prices driven by American supply growth. It also points to a very awkward conundrum for State Department interests in the Gulf – this is ultimately about U.S. global power, not just oil.
5) All Points On The Compass Look East
The more damaging geopolitical problem is that anywhere ‘East of Nigeria’ will be looking to China and India for security of demand and geopolitical cover. China will stake its claim to regional dominance far more aggressively and expand its influence into the Gulf. The Asian ‘pivot’ will lose its bearings, and the dollar put on borrowed time if China no longer sees fit to keep bankrolling the Fed for its own security ends. What’s worse, Washington will still be intrinsically connected to global oil prices but have zero influence in the Gulf, Caspian, Russia or East Africa to influence material outcomes. That’s on anything ranging from nuclear proliferation to delicate succession issues. China will be calling the shots, able to split the world in two by laying claim to the Middle East, the Caspian, Australasia, Russia and East Africa as vital interests.
6) America Might Lose Friends Closer To Home As Well
Well, when we say ‘split the world in two’, it’s not going to be quite that neat for the Americas. There’s no way Canada, Mexico, Colombia, Ecuador, Venezuela, Brazil or Argentina will be happy relying on a single source of supply and a single source of demand from Washington. Far from selling oil into a saturated U.S .market, they’ll redouble their efforts to export energy to Asia, a hedge that could significantly reduce Washington’s long term influence in ‘Monroe’s playground’. Brazil could end up joining OPEC; Canada will be very tetchy about Arctic developments. As for Europe, with the trans-Atlantic relationship dead, they’ll go looking for new friends to help with energy supplies. The most likely of which is China to align consumer interests on the Eurasian land mass. The Western Hemisphere shrinks; for China, the sun never sets.
7) America Will Struggle To Keep Pace
Having lost most its friends (or ‘frenemies’) as some like to put it, America has a bigger problem. Can it really follow through towards 2050 as the biggest energy player in the world? The geological data is unsure. America’s 482tcf of gas and 25.2bn barrels of oil will start to look very small, and particularly if other producers follow America down an unconventional path. That’s by no means unlikely when you consider U.S. benchmark pressures could force traditional producers to give up trying to control prices, and go for a volumes strategy instead. We’re already on the verge of that happening in the natural gas world, there’s no reason why it wouldn’t be any different for oil. 110mb/d by 2020? Probably doable in a risk free, care free world; call it ‘OPEC’s unconventional bounce’. In a race to the bottom of the barrel, the Middle East is always going to trump the U.S. mid-West.
8 ) But Fear Not, America Can End Up A Chinese Lake
If that happens, fear not, the one country that will keep investing in U.S. liquids production is China. It’s in direct Chinese interests to make sure America fulfils its oil potential to help forge a structurally cheap and abundant energy world, not to mention hedging Beijing’s supply side portfolio. China has pumped $17bn into America since 2010, $10bn into Brazil, $16bn into Venezuela, and $18bn into Canada. And that’s before you consider the prospective $15.1bn Nexen mega deal. Many think it’s farfetched, but look closely at the U.S. natural gas scene. China’s not only happy ploughing money into economically disastrous dry shale plays, it’s providing supply side contracts and finance for U.S. LNG export growth. Ask Cheniere down at Sabine Pass. Cheap U.S. gas on international markets is exactly what China wants to secure preferential contracts across the board, and it’s precisely what they’re now eyeing for oil.
9) Blunt Conclusion: China Gains Most From Cheap U.S. Oil
The core reason is China knows it gains most from a world of cheap and abundant energy. America ‘wins’ a ten to fifteen year tactical victory from enhanced liquids output, but in doing so, loses the long term battle for superpower status against China. Beijing gets to drive through its industrial revolution on the cheap, all while the economic gains for America remain marginal. Beijing leverages U.S. production gains to break the pricing game and force producers into a volumes future. Despite 80-85% import dependency, China picks up the pieces in a perennial buyer’s market. America goes home, broke.
10) Blunt Footnote: Climate Mitigation Gone, Climate Adaptation The New Game
By way of footnote, any hope of progressing climate mitigation through a US-China deal has now totally gone. This will purely be a world of climate adaptation to reduce the worst impacts of climate change. 2C stabilisation no chance; 450 parts per million by 2017, probably so. Where the relative costs fall will be down to mother nature on that one.
… Silver Linings?
But fear not, there’s a silver lining here and it’s the reasonable chance that the IEA is totally wrong. The report spends very little time looking at shale oil decline rates, some of which have dropped to around 20-40% of original production. Nor does it look at the quality of the geology that’s left in America once the juiciest plays are gone. As for political risk, that doesn’t appear to exist in America, (no doubt BP could add a nice chapter for the IEA on that score). Then you get onto break even prices. The IEA genuinely seems to think we’ll only be consuming 99.7mb/d by 2035, up from around 90m/b today. If that’s so, we’ll be swimming in the stuff. Production would need to be so cheap in the U.S. it’s basically free. Rex Tillerson can forget losing his shirt from cheap shale gas; he’ll be down to his y-fronts once China has stripped America bare through relentless liquid investments.
Get the picture; energy gains are great, but everyone should be very careful what they wish for, most of all the IEA, whose political capital frankly doesn’t extent that far these days beyond Washington and Paris. And certainly not in Ankara, if the locals are much to go by…
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This article is available online at:
http://www.forbes.com/sites/matthewhulbert/2012/11/12/ten-reasons-to-be-concerned-about-u-s-energy-independence/
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GM:
I confess that I did not follow quite a bit of that. Indeed, I found some of it rather incoherent.
For example:
"Needless to say, this makes a total mockery of ongoing US external support for oil supplies coming from the Middle East. It makes zero sense for Washington to be paying billions in tax payers’ money maintaining the 5th Fleet in Bahrain only to watch OPEC states internally implode from the prospect of lower oil prices driven by American supply growth. It also points to a very awkward conundrum for State Department interests in the Gulf – this is ultimately about U.S. global power, not just oil."
So the problem is that we don't need to care about the middle east as much as we used to? :?
I could go on, but frankly I find the piece not worthy of my time , , ,
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The point of the author, in that section means that our few remaining "allies" in the ME would collapse if oil drops too much. Thus, if we managed to produce enough to meaningfully reduce the global oil prices, we'd have a pyrric victory as the drop would not last when the jihadis swallowed up those ME nations that imploded from lowered oil revenues. Back to high prices and even less of a strategic position globally.
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Not persuaded. The reason that so many people care about what happens in the mid-east is that up until now it has supplied a goodly % of the world's energy. If energy supplies elsewhere (including the US) expand dramatically, then the mid-east, apart from the nuclear issues, matters dramatically less. Seems like a good thing to me!
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The points in the article are interesting to me, important considerations for awareness going forward. They do not override the competing case, that to not produce our energy means unaffordable energy contributing to other problems like uncompetitive manufacturing, imbalance of trade in the trillions with resulting effects on our currency, increased need for redistribution and big government because of widespread energy unaffordability. Foremost, to not produce our own energy means to have the fascist forces of our government override the freedoms of our enterprise. Not to mention making places like the Straits of Hormuz and people like the Mullahs and Chavezes of the world crucial to our economic survival. Not an optimal situation, as the President said about 4 dead Americans in oil producing Libya.
My understanding is that fracking and shale oil and oils sands development came about because of artificially high prices on oil. Saudi oil (and Alaskan oil, Venezuelan) is still cheaper to produce. Those sources will always have a cost and price advantage even if they run the rest of their economy miserably.
Energy independence is not the term for what we need; it's more like energy balance. We export a lot of energy now but import far more. The goal IMO is just to get production totals more in line with consumption requirements. When that becomes true we will have a neutral effect on world prices as both a producer and a consumer, and an importer and exporter of energy. Qatar, Bahrain, Kuwait, Emirates, etc. do not have to go broke as the oil price stabilize under $100 nor does their product become obsolete. (Nor do we have to stop being their ally.) US production will not push prices to zero nor to a level below their cost basis.
With increased US production these 'allies' in the Middle East will still face the same cultural/economic challenge they always faced, to build out the rest of their economy producing something of value more than just oil. Same is true for Mexico, Canada, Houston and the people of Williston ND.
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Jenkins: Good Will Fracking Hollywood wimps out and makes a formula film.
By HOLMAN W. JENKINS, JR.Like this columnist ..
After a decade of war and half-century of costly military involvement in the Middle East, the United States stands on the brink of "energy independence." Then a shadowy Canadian billionaire coupled with Mideast oil interests sponsor a Hollywood propaganda movie aimed at luring Americans into throwing away the instrument of their deliverance: shale energy.
They co-opt a name-brand Hollywood movie star to be the useful idiot of their nefarious plot. The movie is released a few days after Christmas, just in time for Oscar nominations in a diabolical scheme to influence a national debate over fracking.
In other words, a typically stupid Hollywood thriller plot, except for a minor deviation: The poor shmuck actor is Matt Damon and he's making a real movie, albeit with its own typically stupid Hollywood plot, one that doubles down on the conventional "evil oil company" stereotype.
If you somehow missed the twists and turns, Mr. Damon, who played a genius in "Good Will Hunting" and a master spy in the "Bourne" movies, has pled ignorance of the fact that financing for his movie came partly from Abu Dhabi, which, as the Heritage Foundation puts it, has a "direct financial interest" in fanning opposition to domestic energy development.
So will Americans flood out of theaters early next year demanding to be relieved of the shale bounty? Not likely. And before getting too conspiratorial, Abu Dhabi's last movie was a Nick Cage "Ghost Rider" stinker, while Jeffrey Skoll, the Canadian eBay EBAY +1.59%billionaire and co-financier who makes no secret of his progressive longings, also backed "Lincoln" and "The Best Exotic Marigold Hotel."
Perhaps Mr. Damon at least made a good movie. Alas, early word is not promising. Variety, not constitutionally inclined to criticism, called it "dramatically underpowered" and said its plot "cheapens the seriousness of the issues at stake."
If a movie were to tell the truth about fracking, it would begin with the core conflict, which isn't between environmentalists and earth-raping oil companies. Fracking was a bone of contention first of all between landowners who wanted to cash in on energy royalties and neighbors who didn't want the neighborhood invaded by heavy industry.
Yard signs abounded. Longtime acquaintances bellowed at each other in town-hall meetings. Groups professionally hostile to energy development only arrived later, having had the wit to notice that the more affluent, country-home owning opponents of local fracking were the environmental groups' natural constituents.
Thus was born a political war, complete with standard "Big Oil" versus "Greenies" symbology, out of what had been a neighbor versus neighbor dispute. Yet, truth be told, neighbor versus neighbor is still the only story that's interesting. Fracking, in Pennsylvania and upstate New York, came into a world long abandoned by economic dynamism. Fracking threatened to transform a bucolic quietude that some liked just fine and others couldn't wait to earn enough money to escape.
This is the story of economic development in every time and place, which is never without its ambivalences, transforming landscapes, inflating property values, altering social dynamics. To treat these themes realistically in a movie is not a sin. Energy companies in the Marcellus Shale were never going to be especially sensitive to the dilemmas they created for residents with the big money they were handing out. Residents were always going to be what they were: conflicted, greedy, frightened, resentful.
Filmmakers may be ideological numbskulls, but their real problem is often that they are cowards, too afraid of their friends to make an interesting movie. The painter Degas once said, "A picture must be painted with the same feeling as that with which a criminal commits his crime." If Degas meant anything by this, he likely meant that caring too much who approves or disapproves is the death of art.
If a screenplay leaked by the pro-fracking activist Phelim McAleer is accurate, art dies in Mr. Damon's movie in an ironic way. In the real world, water-pollution fears put forward by fracking's opponents have proved largely hokum. The movie deals with this inconvenient fact by turning its eco-activist protagonist into an agent provocateur of the oil company, whose job is to discredit the environmental opposition from within.
Which is very much like what ideological critics are saying about Mr. Damon's "Promised Land"—that the film's backers are an unholy alliance of green money and oil sheiks out to abort America's fracking windfall.
Bad art is bad art. It seeks to compensate for its own lack of confidence by inflating the stakes. What makes fracking fascinating is precisely the quotidian fact that, in every way, we are inclined to celebrate economic progress except when it disturbs our own familiar scenery and routines. Fracking, for this reason, is proving to be the most carefully observed, policed and debated industrial revolution in the history of industrial revolutions. And a movie that had the courage to be interesting about all this might actually be worth watching.
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U.S. CO2 Emissions Hit 20 Year Low
I came across this in an Aug 2012 'American Interest' post while looking for other things. http://blogs.the-american-interest.com/wrm/2012/08/16/us-carbon-emissions-hit-20-year-low-no-thanks-to-carbon-trading-schemes/
Largely unreported, maybe you saw it in the NY Times - they covered it in a blog: http://green.blogs.nytimes.com/2012/08/17/a-20-year-low-in-u-s-carbon-emissions/
Readers here might know:
"According to the International Energy Agency, the United States has cut its emissions 7.7 percent since 2006, more than any other country or region in the world."
(http://dogbrothers.com/phpBB2/index.php?topic=1096.msg64699#msg64699)
That world-saving breakthrough was reported by the Washington Post - posted in a blog!
Why is this happening - the reduced emissions, not the poor media coverage. Increased production and use of natural gas, for one thing. We don't need more coal if we allow production and consumption of natural gas which burns far cleaner:
Fossil Fuel Emission Levels - Pounds per Billion Btu of Energy Input
Pollutant Natural Gas Oil Coal
Carbon Dioxide 117,000 164,000 208,000
Carbon Monoxide 40 33 208
Nitrogen Oxides 92 448 457
Sulfur Dioxide 1 1,122 2,591
Particulates 7 84 2,744
Mercury 0.000 0.007 0.016
Source: EIA - Natural Gas Issues and Trends 1998
Want even cleaner energy? Anyone ever heard of nuclear?
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I'll stick this under Energy but really it is liberal fascism running wild. Combine this with healthcare and they have pretty much every aspect of your life under control.
This Senator, incoming chairman of the Senate Committee on Energy and Natural Resources, isn't just going to regulate the safety of the energy business, he is going to give deep thought to whether you should be using the energy at all.
And if you produce natural gas legally and safely, and even though we already have a pipeline of it to almost every home, he is going to give deep thought to the question of who you should be able to sell it to.
I find this kind of extremism scary beyond words.
http://thehill.com/opinion/op-ed/281281-getting-natural-gas-right-a-priority
"The committee’s first order of business will be natural gas: how it’s produced, how it’s used and how much of it the U.S. should use it here or send abroad."
This is the government talking about what private business should be able to do. Stopping one of our safest and cleanest sources of energy. Based on what authority?
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Anyone want to take a stab at it?
G M, I know, George Bush's fault. No really, why?
My first thought is that the new oil increases from private lands are being offset by the lost production on public lands. Our net increase in production is not enough to make a dent in the global market or price.
My second thought is that oil/gas up is an indicator of economic health in the global economy. This one seems unlikely looking at the US and Europe, but there is growth in some developing countries.
Last is to recognize the distinction between new oil produced and refinery output of gasoline. Asking this question through google brings up a string of stories from about a year ago warning of refinery closings, lost capacity and higher prices coming. Who knew?
http://www.businessweek.com/articles/2012-02-23/angry-about-high-gas-prices-blame-shuttered-oil-refineries
http://abarrelfull.wikidot.com/blog:why-are-refineries-closing-down
http://usatoday30.usatoday.com/money/industries/energy/story/2012-01-28/cnbc/52825378/1
http://money.cnn.com/2012/04/10/news/economy/refineries-gas-prices/index.htm
http://www.bloomberg.com/news/2012-10-03/california-gas-stations-begin-to-shut-on-record-high-spot-prices.html
I thought the Cheney plan called for the permitting of new refineries. Where are they?
What screws up the business of the refineries? 50 sets of rules for winter and summer gasoline blends for one (hundred) thing(s). What are the Feds doing with all their new powers to fix this? Why isn't CNG more available if we are awash in natural gas and if they want us to emit less carbon?
What new refineries has Obama supported?
Another problem for refineries is that the new oil is heavy, of tar sands origin. Where is the sweet, light crude? We are leaving it in the ground up in ANWR. Who opposes drilling for the sweet light crude? The people who wanted these prices high.
In spite of the brave capitalists in North Dakota, Mission Accomplished.
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Could the loss of value for the dollar be a factor here?
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Frankly, ANWR drilling makes me nervous. Look at what a clusterfcuk was created by BP in the placid, warm waters of the Gulf of Mexico. Now imagine that same mess in the exceedingly hostile environment of the Arctic Sea.
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Could the loss of value for the dollar be a factor here?
Excellent observation. Middle East oil tends to follow gold, not the dollar. After the whole 1971 monetary crisis and the oil embargo of the 1970s it turned out that the price of oil, measured in gold, had remained largely unchanged.
We weren't seeing the loss of value so much yet but they certainly have noticed the diluting or our shares.
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Frankly, ANWR drilling makes me nervous. Look at what a clusterfcuk was created by BP in the placid, warm waters of the Gulf of Mexico. Now imagine that same mess in the exceedingly hostile environment of the Arctic Sea.
Respectfully disagree. ANWR I think is the low hanging fruit of oil. The Alaskans favor it. The caribou want it. The drilling is the easiest. Transport by pipeline I think is the safest. Refining is far easier. The deep water operation was confounded by - deep water. They went deep because the cheaper, easier, safer sources closer to shore were blocked. MHO.
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Yes , , , but:
The Arctic Sea is a REALLY hostile environment, FAR more so than the Gulf of Mexico. Look at how long it took to straighten out the BP mess. Imagine trying to solve a similar problem with 20-30 foot seas on the surface in temperatures of 40 below zero with winds of 40+MPH. NOT my idea of low hanging fruit!
Agreed re the relation between gold and oil.
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Yes , , , but:
The Arctic Sea is a REALLY hostile environment, FAR more so than the Gulf of Mexico. Look at how long it took to straighten out the BP mess. Imagine trying to solve a similar problem with 20-30 foot seas on the surface in temperatures of 40 below zero with winds of 40+MPH. NOT my idea of low hanging fruit!
Agreed re the relation between gold and oil.
Crafty, you are of the belief that the oil production in ANWR would be offshore? My understanding is that the drilling platforms would be located safely on land. http://blog.heritage.org/2008/06/29/the-truth-about-anwr/
The opposition materials I read were based (intentionally) on old drilling technologies, not what can or would be built today. No one is talking about drilling 5000 feet beneath the sea in the Arctic. Temperatures of 40 below zero, 40mpg winds? You guys think that's cold? :wink: Sea water freezes at 28 degrees, 68 degrees warmer than that. It's those pesky in-between seasons where the cold breezes hits open water. Not a big factor if the platforms proposed in ANWR are on land. The cold frozen tundra may actually help contain a potential spill. The deep water site was built in the ocean in a hurricane zone, and that wasn't what went wrong. The explosion in the gulf was not with light, sweet crude. The asphalt-like qualities of the heavier oil contributed to the risk of explosion and difficulty of cleanup in the gulf.
If not ANWR, the easiest to refine oil sitting under US voter controlled land, which US oil sources are the 'low hanging fruit'?
More surprising is the impression that concerns out of LA or DC should override the opinion of the locals that the operation can be constructed and operated safely, which is exactly what happened. States' rights don't apply in this case because ........... .
The damage in the gulf (also Valdez) was horrendous, perhaps unprecedented at the time. What is the lasting effect of those? Is the environmental damage less when the Chinese, Russians, Brazilians or Mexicans do our drilling? When we leave the money (our energy demand) on the table, then what happens? Someone else does it, and not with better environmental protections.
Is the expected environmental damage more destructive than the current policy of leaving American oil in the ground and shipping dollars to enemies for our oil. Example: With consumption demand quite strong and stable, the supply choice, in part, is between supporting Chavez' support for Iran's planned destruction of Israel versus building well constructed facilities in the US. Spills avoided in the Arctic by not producing oil there means other risks elsewhere are increased. Right?
$4 and $5 gas in a stagnant economy (http://www.realclearmarkets.com/video/2013/02/06/5_a_gallon_gas_hits_california.html) is not the stopping point for rising energy costs. If you don't drive much, think of proportional increases in jet fuel and airline travel. Not producing oil with the strictest precautions at this point in time is a move against prosperity and freedom IMHO.
Similar dilemma for nuclear. There was stupidity in the location of some facilities, but there also the largest, safest, cleanest energy supply ever produced, see charts in this thread.
I favor applying mathematical analysis to all honestly measured environmental risks from all sources and then making positive choices.
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Yes, yes, I acknowledge your point about ANWR being on land-- my bad. I was thinking about the leases for off-shore drilling that some are calling for.
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Thanks Crafty. These other offshore locations involve different risks. Hopefully we have learned lessons from the gulf deepwater disaster that can make these operations even safer. The major objection to near shore drilling is that our oil consuming electorate does not want to look out and see oil produced. Like liberal Cape residents and visual windfarm 'pollution'.
The costs, lawsuits and bad publicity against BP, and Exxon previously, are quite a strong deterrence to having environmental screwups. Regulators unfortunately are always behind the curve and not always working with the right interests in mind.
The main arguments against ANWR were that oil is bad for us and that it would have taken 10 years to benefit from the vast new production, 16 years ago. The new surge in American oil would have on line to help us at about the time we chose economic collapse instead.
If government has a role in this, it would seem to me that the main effort would be to ease the migration to domestic natural gas usage for individual transportation with 30% lower CO2 emission per unit of energy. Right now it is only practical for fleet owners in most locations. Instead the administration is planning its war against natural gas.
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Drudge lead:
(http://t0.gstatic.com/images?q=tbn:ANd9GcS5WT1RQskT0jLb2TcfJqQ96-4M2W-7kIWd6fhaevffoIMfWnB_)
Didn't the Cheney task force call for more refining capacity 12 YEARS AGO?!
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How many decades has it been since we have built new refineries?
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How many decades has it been since we have built new refineries?
We have added some new and some expansions recently; it is only the 'complex' refinery type that hasn't been built since the 70s. http://www.eia.gov/tools/faqs/faq.cfm?id=29&t=6
We are down from 254 to 137 refineries in 30 years. Total capacity is slightly up, but apparently not enough to meet demand in a stalled 2013 economy.
The other problem is that state laws require different blends in different seasons in 50 states. Discontinuing an old product and ramping up a new product twice a year is disruptive to production and price. I'd like to see that problem fixed without a new federal law.
Gas was 1.82 when Obama took office. Even if total production is up slightly, it did not keep up with demand even in a stagnant economy.
Oil prices have been more stable, only up a couple of dollars lately.
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Good, detailed article here on gas prices:
http://www.caranddriver.com/features/why-are-gas-prices-going-up-when-demand-is-going-down-feature
Looks like gas prices now are the lowest they will ever again be. A refinery in Phillie is going down this summer that is 1/4 of the east coast capacity?!!
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Gov of Colo, on my 2016 Dem short list, seems to be taking on the fracking opponents on the left (like the NY Times) by asserting that the fluid is completely safe. He is such a newcomer that he doesn't even know the name Haliburton is a Democratic swear word.
http://www.washingtontimes.com/blog/inside-politics/2013/feb/12/colorado-gov-hickenlooper-i-drank-fracking-fluid/#ixzz2LGJz39zE
I drank fracking fluid, says Colorado Gov. John Hickenlooper
By Ben Wolfgang - The Washington Times February 12, 2013, 12:32PM
Colorado Gov. John Hickenlooper went to unusually great lengths to learn firsthand the strides the oil and gas industry has made to minimize environmental harm from fracking.
The first-term Democrat and former Denver mayor told a Senate committee on Tuesday that he actually drank a glass of fracking fluid produced by oilfield services giant Halliburton.
The fluid is made entirely “of ingredients sourced from the food industry,” the company says, making it safe for Mr. Hickenlooper and others to imbibe.
“You can drink it. We did drink it around the table, almost rituallike, in a funny way,” he told the Senate Committee on Energy and Natural Resources. “It was a demonstration. … they’ve invested millions of dollars in what is a benign fluid in every sense.”
Sen. Al Franken, Minnesota Democrat, found humor in the governor’s admission and asked if the experience was part of some bizarre occult practice.
“No, there were no religious overtures,” Mr. Hickenlooper responded.
While some laughed at the governor’s statement, he brought up the incident to make a serious point: that oil and gas companies have taken major steps forward in fracking technology.
The practice uses water, sand and chemicals injected into the ground at tremendous pressure to break apart rock formations and release fuel. Environmental groups and many other critics long have been concerned about the chemicals used in the practice and their potential effect on groundwater.
Mr. Hickenlooper stressed that the Halliburton food additive mixture is so safe, one can literally drink it. He also cautioned against state and federal lawmakers going too far with laws to force companies such as Halliburton to disclose the formulas for such products.
“If we were overzealous in forcing them to disclose what they had created, they wouldn’t bring it into our state,” he said.
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Methane Hydrates and the Potential Natural Gas Boom
February 11, 2013 | 1115 GMT
Summary
Hydrate methane burning at Japan's Gas Pavilion in 2005
Methane hydrates, which are natural gas molecules trapped in ice, offer a potentially abundant source of natural gas widely distributed across the globe. Assuming the extraction technology can be mastered, methane hydrates could offer traditionally resource-poor countries greater energy security.
Analysis
The so-called shale gas revolution has changed the face of the energy industry in the United States. Natural gas production in the United States is at an all-time high. Proposals for, and the actual construction of, liquefied natural gas export terminals in the United States have replaced plans for liquefied natural gas import terminals. But shale gas deposits as a proportion of global natural gas supplies may seem minor in comparison to methane hydrates.
Methane hydrates form at a specific range of low temperatures and high pressures. They occur in the Arctic permafrost and along continental slopes, typically at water depths greater than 500 meters (1,640 feet). Once considered only a hindrance to conventional extraction, emerging technologies to tap methane hydrates mean they now have the potential to alter the global energy outlook. Estimates for total methane hydrate gas in place are rough, but range anywhere from 3,000 trillion cubic meters to more than 140,000 trillion cubic meters, the large range illustrating the uncertainty of the estimate. By comparison, combined global technically recoverable conventional natural and shale gas reserves total roughly 640 trillion cubic meters. (In 2011, global natural gas consumption stood at approximately 3.4 trillion cubic meters.)
Despite the promise of methane hydrates, the technology for their extraction is still under development, and potential risks have not been neutralized. These include the uncontrolled release of natural gas formerly trapped in ice, which could result in large amounts of the greenhouse gas methane entering the atmosphere. They also include the possibility of destabilizing the ocean floor, leading to underwater landslides and subsequently the possible sinking of drilling rigs.
Drilling likely will be required to access the natural gas in the hydrates. A number of drilling techniques could be used to destabilize the equilibrium of the hydrates and release natural gas. These include thermal injections, which involve increasing temperatures, often by injecting steam, to dissociate the gas. They also include depressurization, or reducing the pressure of the formation to release the gas. Finally, and perhaps most promising, is carbon dioxide injection. In this process, carbon dioxide essentially replaces the natural gas within the hydrate, allowing for the release of natural gas and the capture of carbon dioxide.
Research programs focused on methane hydrate detection and extraction can be found in numerous nations, including Japan, South Korea, India, China, Norway, the United Kingdom, Germany, the United States, Canada, Russia, New Zealand, Brazil and Chile. Much of the initial research has been highly collaborative, with the government and private companies from the United States playing a prominent role.
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Most of these research programs are in the exploratory, experimental and laboratory phases, with expeditions seeking samples to determine the extent of deposits so as to direct further research. Last year, however, Japan completed a successful field test in Alaska in collaboration with Norway and ConocoPhillips, successfully producing natural gas through controlled dissociation via carbon dioxide injections. In recent weeks, Japan has also begun offshore production tests in the Nankai Trough off the coast of central Honshu.
Despite these recent advances, commercial production is still unlikely for at least 10 to 15 years. Japan believes that commercial production will be possible by 2018, while the U.S. Geological Survey estimates that countries with the "political will" to pursue methane hydrates could see production by around 2025. Though expensive compared to conventional methods of recovering natural gas, the estimated cost of methane hydrate extraction is similar to other unconventional sources, such as shale gas. The International Energy Agency estimates that once developed, it will cost between $4.70-$8.60 to extract 1 million British thermal units of methane hydrates. The same studies estimate conventional costs as low as $0.50 per 1 million British thermal units. Developmental and capital costs are likely to be high, since the deposits are in difficult, harsh locations (e.g., Arctic or deepwater environments) and depending on their location, new fields could also mean additional capital costs from infrastructure development.
Methane hydrates are widely distributed throughout the globe, including locations that do not have substantial conventional natural gas reserves. Deposits have been discovered off the coasts of Japan, India, South Korea and Chile, in the Gulf of Mexico and off the southeastern coast of the United States. Potential reserves also exist in the Arctic permafrost of Alaska, Canada and Russia. Their widespread distribution means traditionally resource-poor countries could now have access to domestic sources of energy.
Methane hydrate estimates throughout Asia are still being determined through further exploration, but initial median estimates place Japan's reserves at 6 trillion cubic meters, China's at 5 trillion cubic meters and India's at 26 trillion cubic meters. Japan was the first nation to establish a methane hydrate program, which it founded in 1995. India formed its national program in 1997, and China and South Korea followed suit later. Since 2006, China, India and South Korea have all led exploratory expeditions that included conducting seismic studies and retrieving core samples to determine the composition of possible reserves.
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Japan continues to lead the field, as shown by its recent offshore production testing. Though technologically advanced, Japan lacks many natural resources and so must import the majority of its energy supply. In 2011, it consumed 123 billion cubic meters of natural gas, of which 117 billion cubic meters were imported. Developing a domestic source of energy could restore some of the energy security lost when Japan ceased the majority of its nuclear power production. Japan's imperative to secure energy supplies combined with its technical capabilities may allow it to push forward despite the high economic cost.
While initial offshore exploration has occurred near the coast, often within a given country's exclusive economic zone, future exploration will likely continue offshore. This exploration could happen in contentious waters, especially in East Asia. As technology continues to advance, a new dimension to pre-existing territorial frictions could emerge as nations switch from competing for potential resources to actual resources. Exploration for this resource is a tool competing nations could use to claim sovereignty over disputed waters. Whether or not the technical hurdles of extracting methane hydrates are overcome, short- and medium-term exploration efforts could help countries in their attempts to establish a presence in international or disputed waters. Japan's lead in the development of methane hydrate extraction could give it an edge in the competition for future resources in the region.
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Read more: Methane Hydrates and the Potential Natural Gas Boom | Stratfor
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Just bought gas in the heart of the ND oil boom. Prices same as at home. Still need refineries, cars don't run on heavy crude.
Someone please remind again why Dick Cheney should not have had industry experts advise him on how to meet future energy needs and what the his opponents are using in their tanks. Harry Potter broom fuel?
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Unicorns!
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Famous people reading the forum, we already touched on this: http://dogbrothers.com/phpBB2/index.php?topic=1096.msg69803#msg69803
Former Dem Senator criticizing current Dem policies and threats!
http://online.wsj.com/article/SB10001424127887323478304578329952822121118.html?mod=WSJ_Opinion_LEFTTopOpinion
Natural Gas Exports and the Mythical 'Sweet Spot'
Congressional meddling so warped the market in 1977 that an emergency law was needed to undo the harm.
By J. BENNETT JOHNSTON (former Democratic senator from Louisiana, was chairman of the Senate Committee on Energy and Natural Resources from 1986-94.)
"Which brings us back to today's calls for top-down control of the LNG market. Does anyone really think that Congress or the Department of Energy, years in advance, can predict supply and demand or determine which of the 16 applicants can procure the billions of dollars and decades-long contracts necessary to build an LNG export facility?"
"The free market might not always lead to everyone's definition of the sweet spot, but experience has shown that it is a better allocator and regulator than bureaucrats and politicians. We should heed the admonition of Adam Smith that demand begets supply: Allow the free market to allocate the nation's newfound energy bounty."
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Which party would he join now?
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By BENOÎT FAUCON, SARAH KENT and HASSAN HAFIDH
The American energy boom is deepening splits within the Organization of the Petroleum Exporting Countries, threatening to drive a wedge between African and Arab members as OPEC grapples with a revolution in the global oil trade.
OPEC members gathering on Friday in Vienna will confront a disagreement over the impact of rising U.S. shale-oil production, with the most vulnerable countries arguing that the group should prepare for production cuts to prop up prices if they fall any lower.
"We are heading toward some problems," said a Persian Gulf OPEC delegate.
African OPEC members such as Algeria and Nigeria—which produce oil of similar grade to shale oil—are suffering the worst effects from the North American oil boom. Nigeria Oil Minister Diezani Alison-Madueke deemed U.S. shale oil a "grave concern."
Gulf countries, notably Saudi Arabia, pass relatively unscathed—and are the only OPEC members with the flexibility to cut production. But they are unlikely to let that happen at Friday's meeting, several OPEC delegates said.
That would deepen power struggles that have dominated the organization in recent years. Iran, Venezuela and Algeria, who need high oil prices to cover domestic spending and offset falling production, have regularly clashed with Gulf countries led by Saudi Arabia, who have the financial strength to withstand lower prices.
More
Heard on the Street: East Coasters Drive Down Gasoline Demand
OPEC has overcome past rivalries to rally against an external threat, most notably in 2008 when it agreed to a production cut of more than four million barrels a day to stem a price crash during the financial crisis. But the uneven impact of the North American supply surge makes a collective response—such as a coordinated production cut to support prices—more difficult, said delegates on both sides of the divide.
The U.S. and Canada are set to produce about 21% more oil by 2018 than from this year, according to data from the International Energy Agency.
This marks a historic and largely unexpected reversal. U.S. crude-oil production peaked in 1970 and had declined continuously for more than 20 years when shale oil first began to flow after 2008. U.S. crude production has risen to a 21-year high as hydraulic fracturing, known as fracking, and other technologies have unlocked large resources of oil previously trapped in shale rock in North Dakota and Texas. Shale deposits in other areas, such as Pennsylvania, are yielding mostly natural gas.
OPEC, the source of around one-third of the world's oil, has clearly been taken aback by the shift in U.S. production. In 2010, the organization forecast U.S. and Canadian oil production of 2014 at 11.8 million barrels a day. Just two years later, that forecast had risen to 14.5 million barrels a day.
A rebound in U.S. production would have been unexpected just five years ago because shale oil production requires an oil price that has rarely proved sustainable—typically $70 a barrel or above. But oil prices have remained much higher in the past two years, thanks in part to persistent geopolitical tensions in OPEC producers, such as the Libyan civil war and Persian Gulf tensions.
As U.S. production has grown, exports to the U.S. from three of OPEC's African members, Nigeria, Algeria and Angola, have fallen to their lowest levels in decades, dropping 41% in 2012 from 2011, largely because of shale oil, according to the U.S. Department of Energy. In contrast, Saudi shipments of oil to the U.S. increased 14% in 2012. Saudi Oil Minister Ali al-Naimi said recently that the rise of unconventional energy sources doesn't threaten his country's dominant role in world oil supply because demand also is increasing.
"I don't think anyone should fear new supplies…. The pie is getting bigger, and there is enough to go around," he said.
But the Nigerian oil minister, Ms. Alison-Madueke, sees danger for her country. "Shale oil has been identified as one of the most serious threats for African producers," she said in the U.K. this month. Those producers, she said, could lose 25% of their oil revenue as they are edged out of the U.S.
Nigeria has been hardest hit because its light and low-sulfur crudes compete directly with shale oil, unlike Saudi Arabia's heavier and more sulfurous crude. Other OPEC members who don't serve the U.S. market, such as Iran, are also complaining. Muhammad Ali Khatibi, Iran's envoy to OPEC, told The Wall Street Journal that a combination of rising U.S. shale production and tepid demand is bringing "the price down."
While Saudi Arabia can tolerate lower prices, "there will be some members, like Venezuela, Iran who will struggle at $90," said Amrita Sen, chief oil analyst at London-based Energy Aspects Ltd. The front month Brent contract for July settled at $102.62 a barrel Monday. Venezuela's oil minister said on Monday that he would push for a cut in OPEC production if oil falls below $100 a barrel.
Iran needs high prices to offset the loss of $26 billion of oil revenue last year from tough Western sanctions on its exports, according to estimates from the U.S. Energy Information Administration.
Algeria, which has been rattled by riots over food and housing, needs an oil price of $121 a barrel to cover planned domestic spending—including for roads, jobs and housing—according to the International Monetary Fund.
The country's oil and gas revenue fell by 9% in the first four months of 2012, according to government figures. Algerian Finance Minister Karim Djoudi has said that lower revenue tied to mounting U.S. shale production could force the government to cut domestic spending.
"Cutting subsidies without increasing wages could bring tremendous political animosity," and instability, said Geoff Porter, head of security consultancy North Africa Risk Inc.
OPEC officials said the group is preparing studies to evaluate the impact of U.S. shale oil on demand for its crude. "Definitely, we will review nonconventional shale oil from the U.S.," said Mr. Khatibi, the Iranian envoy.
However, there is no agreement on the size of the challenge. Mr. Khatibi said the North American oil boom has created a global oversupply of 1.5 million barrels a day. Delegates from Gulf nations see the excess at no more than 500,000 barrels a day.
In the past, Saudi Arabia has simply ignored more hawkish members such as Iran and increased oil production when they failed to reach an agreement—as was the case during an acrimonious split two years ago. Saudi Arabia is the only country with sizable flexible production, giving it some influence on prices.
But the group can ill afford new divisions. In 2008, Saudi Arabia was forced to backpedal from a unilateral supply boost after prices crashed by $100 a barrel.
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The New Prometheus
The domestic energy industry is booming—and driving a U.S. economic revival
By DANIEL YERGIN
When the 'shale gale'—the surge in the production of natural gas trapped in very dense shale rock—first came into public view in 2008, the focus was primarily on the energy and environmental implications. But the past couple of years have brought recognition of shale gas's economic consequences, beginning with major job creation in a time of stubbornly high unemployment. President Barack Obama has repeatedly cited the jobs impact of shale, including in his State of the Union address last year and even in one of his debates with Mitt Romney. At the same time, abundant low-cost energy is stimulating a revival of manufacturing in the U.S. as well as increased American economic competitiveness—as angst-ridden European CEOs will tell you. And the change has come quickly. Shale gas, only 2% of total U.S. natural gas production a decade ago, is now nearly 40%.
Comeback
By Charles R. Morris
PublicAffairs, 179 pages, $12.99
The economic portent of America's unconventional oil-and-gas revolution is at the heart of Charles Morris's "Comeback: America's New Economic Boom." Mr. Morris is the author of a number of books on the U.S. economy and economic history. His most recent, the commendable "The Dawn of Innovation," described the explosive growth that resulted from America's first industrial revolution during the early decades of the 19th century. But it was in 1990, at another time of economic gloom, that Mr. Morris published "The Coming Global Boom," correctly predicting an era of strong economic growth.
Now he is back with a similar argument, namely that "the United States is on the threshold of a long-term economic boom, one that could rival the 1950s-'60s era of industrial dominance." The country, as he sees it, is at a turning point that most people, mired in chronic pessimism, are missing. The source of the boom this time, Mr. Morris says, will be "rising American productivity" and industrial "restructuring" that "has made the United States one of the most desirable manufacturing sites in the world, especially in states like Virginia, Tennessee, Georgia, the Carolinas, and Alabama."
The "manufacturing renaissance" in the U.S. is also fueled by what is happening elsewhere. With industrial wages increasing 15% to 20% per year, China is losing what had been the indubitable edge that transformed it into the workshop of the world. There is also the logistical advantage of manufacturing close to North American markets, especially when transportation costs are added in. All this is giving the U.S. renewed impetus as a manufacturing platform for global exports: Japanese auto makers now build cars in the U.S. for export to Europe; the German engineering conglomerate Siemens SIE.XE -1.38% does the same for gas turbines sold to Saudi Arabia.
But—and this is central to Mr. Morris's argument—what really turbo-charges this American advantage is what he calls "the new X-factor, the American energy advantage," the arrival of low-cost shale gas. Here is the big new chance for American industry. As Mr. Morris puts it, shale gas can be the central pillar of America's coming economic rebound. "Unless something goes horribly wrong," he says, "energy is a game changer." The U.S. and Canada have this ace up their sleeves while, at least at this point, no one else does.
There are other reasons to be optimistic, according to Mr. Morris: The comeback he foresees is bolstered not only by the new availability of inexpensive, abundant energy and the resurgence of manufacturing but also by an uptick in public infrastructure investment and the continuing growth of the health-care sector.
His main focus, however, is the positive economic impact of shale gas. He spends some time on the employment effects. He cites research findings from IHS, a research firm of which I am vice chairman, showing that 1.7 million jobs are currently supported by this unconventional revolution in oil and gas. (That doesn't include the additional jobs resulting from the expansion of manufacturing.) Most of these shale jobs have been created since 2008 and the beginning of the recession. The economic impact of shale, including especially the job numbers, helps explain why public policy has been supportive of shale gas and why state governors focused on economic development are among shale's biggest backers. And the job creation will continue to explode: Mr. Morris argues that this unconventional revolution could support more than four million jobs by the end of this decade.
Mr. Morris adroitly explains the workings of what he calls—no doubt to the alarm of some—"the splendid technology that makes [shale] possible." That is hydraulic fracturing, better known by the now-famous shorthand "fracking." This is the process of injecting water and sand mixed with a small amount of chemicals, under high pressure, to create fractures in rock deep underground that allow gas to flow into the drill hole.
But the author's discussion becomes confusing when he takes on the environmental questions around shale gas. Despite the oft-expressed concerns in the fracking debate about the amount of water used in the process, Mr. Morris points out, such drilling even in gas-rich Texas uses only 1% of the total water consumed in the state. He rightly underlines the importance of properly dealing with the waste water produced from drilling a well, one of the central tasks of proper environmental stewardship. All good, but then he also declares that the most dire portrayal of the environmental risks by anti-fracking critics is "mostly right." Yet then he switches course yet again and concludes that the environmental issues can be managed—although he never really demonstrates that they aren't being managed well in the first place.
Mr. Morris is particularly exercised about "fugitive emissions" of methane from gas production. This is a subject of major debate because methane is 25 times more potent a greenhouse gas than carbon dioxide. Mr. Morris wholeheartedly embraces the view that this is a very big problem, dismissing analysis that indicates that the risks have been greatly overstated. But in April, the Environmental Protection Agency—which had previously expressed much concern on this subject—significantly lowered its estimate of methane emissions owing to an improved understanding of well operations. Further reductions in the estimates will likely result from the prevalence of "green completions" in new wells, which trap methane instead of allowing it to be flared or vented into the atmosphere.
What really bothers Mr. Morris, however, is the possibility that the U.S. might join the ranks of liquefied natural gas (LNG) exporters. This, he says, would not only hijack the low-cost energy opportunity but would also turn the U.S. into "a raw material colony of an Asian industrial juggernaut"—that is to say, relegate the U.S. to the subservient role of provider of cheap energy for rising China.
Actually, he is a little late on that. The "train" (to use the industry word for LNG export facilities) has already left the station. The first new export facility to be permitted by the U.S. Department of Energy will begin exporting around 2016, and two weeks ago a second was approved.
Being a mere raw-material colony would clearly be a bad thing in anybody's book. But Mr. Morris's assertions are a little overheated. Markets themselves will dictate that only a handful of new LNG export facilities will be built in the U.S. There will be a great deal of competition, from present and future suppliers in other countries. As many as five new LNG export facilities are planned just on the west coast of Canada, a country that doesn't have a hang-up about energy exports. The huge new resources of natural gas that have been discovered off the shore of East Africa will also enter the market, and perhaps even the big discoveries off Israel. The U.S. won't be the lowest-cost supplier. The discipline dictated, moreover, by the cost of new projects—ranging from $7 billion to $60 billion—will also limit what gets built.
Mr. Morris's worry about exports reflects his fear that there may not be enough natural gas to go around. But today's natural-gas market is constrained by demand, not supply. Just a few weeks ago, the Potential Gas Committee, a nonprofit affiliated with the Colorado School of Mines and the authoritative source on the nation's gas resources, raised its projection for technically recoverable natural gas supplies in the U.S. by 26%.
When he gets to his third pillar—stepped-up spending on roads, bridges, railways and the like—Mr. Morris makes a compelling case that the U.S. is significantly under-investing in the infrastructure needed to support economic growth. "We now spend," he writes, "half as much on public infrastructure relative to the size of the economy as we did fifty years ago." He points, for example, to the deterioration of the inland waterways that tie the Midwest and its industries together and on which the manufacturing revival will depend. It was too late for his book, but the collapse a week ago of I-5 over the Skagit River in Washington state underscores his warnings about the risks from aging infrastructure, including tens of thousands of "structurally deficient" and "functionally obsolete" bridges around the country. Remedying the widespread infrastructure deficiency through public spending, Mr. Morris predicts, will add fuel to a once-again roaring industrial engine. "Infrastructure financed by borrowing has a long and honorable history in the United States," he writes.
But it is not only lack of such government finance that, in Mr. Morris's view, is holding things up. There is another big constraint: inordinate delay. To make that point, he calls on his own experience: He worked in New York City government 45 years ago trying to get a third water tunnel built for the city. It was supposed to take a decade, but "current expectations are that it will be completed around 2020." That may be an extreme, but it does point to what seems the ever-lengthening time it takes to "get to yes" on major infrastructure projects.
When it comes to health care—another pillar of the comeback—Mr. Morris asks an interesting question: Does it make sense that the purchases of refrigerators, cars and computers are considered positives for economic growth but not any expansion of medical services? He provides his own answer: Health care is a "vibrant industry" that contributes to growth.
In a previous book, "The Surgeons: Life and Death in a Top Heart Center" (2007), Mr. Morris investigated health care by "shadowing an elite cardiac unit" at Columbia-Presbyterian hospital in New York City for most of a year. But how health care fits into his argument in "Comeback" isn't so clear. He wants to build upon the "new Obamacare machinery" to extend "federal bargaining power in setting vendor payments." And he has no doubt as to who are the villains in his health-care narrative. "Doctors," he writes, "increasingly ply their trade within various forms of corporate organizations devoted to exploiting the hallowed fee-for-service payment paradigm by ping-ponging patients between as many diagnostic tests and minor procedures as they can." This seems to be a rather broad brush with which to paint doctors, many of whom are even more confused than the public about how health reform will work and what it will mean for their ability to practice.
Mr. Morris's other big villain is the drug industry. His proof is the hefty dollars in legal settlements between the federal government and drug companies. Yet the size of settlements between the federal government and companies, intent on avoiding litigation and reputation damage, is not necessarily proof of wrongdoing. What all this really has to do with shale gas and manufacturing revivals isn't obvious, and Mr. Morris doesn't persuasively connect these developments.
Overall, "Comeback" captures the major changes set in motion by the unconventional oil and gas revolution. The result, Mr. Morris says, will be higher economic growth and a quickly disappearing federal budget deficit. "Trade and budget deficits will shrink in real terms and cease to dominate the political discourse," he writes. This will in turn change politics: "A vigorously growing economy going into the 2016 election should lock in a liberal ascendancy for a considerable period." To help speed the decline of the deficit, Mr. Morris, who describes himself as an "old-fashioned liberal," calls for moving tax rates up "a good notch," though without addressing the setback that such a "good notch" might mean for the comeback.
There are misfires on facts in the book. Natural-gas prices did not plummet last year due to lack of pipelines. It was primarily because production exceeded demand. In other words, there was a surplus. Here Mr. Morris is confusing natural gas with oil, where the once-famed WTI crude—the West Texas Intermediate—stripped of its place as global benchmark, sells at a discount owing to inadequate pipeline capacity. It is true, as Mr. Morris says, that North Dakota is now the second largest oil-producing state in the country, but it follows not Alaska, as he writes, but Texas. In fact, Alaska, worrying about declining production, is now in fourth place, behind California. Speaking of North Dakota, Mr. Morris glides rather quickly over the significance of the rapid growth in "tight oil" that uses the same technology as shale gas. Yet, with U.S. oil production up 43% since 2008, the impact is no less striking. And more impact is to come.
The contribution of "Comeback" is to cogently lay out the bright economic consequences of the unconventional oil and gas revolution and the revival of manufacturing. Shale gas and tight oil are proving, in ways not expected even a couple of years ago, the fuels of America's comeback. Without them, the economy, instead of gearing up for a comeback, would have been held back even more than it has these past few years.
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http://www.telegraph.co.uk/comment/telegraph-view/10121584/Wind-power-has-failed-to-deliver-what-it-promised.html
Wind power has failed to deliver what it promised
The wind-power industry is expensive, passes costs on to the consumer and does not create many jobs in return
Today, The Sunday Telegraph reveals how many ''green jobs’’ the wind-power industry really generates in exchange for its generous subsidies. The figures show that for 12 months until February 2013, a little over £1.2 billion was paid out to wind farms through a consumer subsidy financed by a supplement on electricity bills. During that period, the industry employed just 12,000 people, which means that each wind-farm job cost consumers £100,000 [US$ 157,000] – an astonishing figure.
...
Wind farms can end up being surprisingly environmentally unfriendly, too. When the wind does not blow and the turbines fail to do their job, consumers have to fall back on the very fossil fuels that they were designed to replace. The result is that we come to rely on foreign imports of oil and gas that hit the household budget hard (domestic coal stations that ought to supply more of the demand have been closed in order to meet carbon-emission reduction targets). Moreover, wind farms can be a blot on the landscape: the dormant turbines take up large tracts of land and kill wildlife; it is the visual pollution of our beautiful countryside that has led some communities to protest against their presence.
The Government has shown recognition of public concern by announcing that residents will be able to stop the construction of wind farms. (more at link above)
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By JOEL KURTZMAN
The debut of a new truck engine rarely attracts much attention. But this spring Cummins Inc. CMI -2.19% released two new truck engines worthy of notice: They are designed to run on natural gas, not diesel. Natural gas is abundant, domestically produced, cleaner and cheaper than oil-derived diesel. It could help set America free of foreign oil.
The natural-gas-powered ISL G and ISX 12 engines are the latest sign of the country's fundamental shift in energy resources and infrastructure. It's not the shift that the Obama administration has tried to engineer by shoveling money at wind-power projects and electric cars. Cummins built its engines without a penny of government support—a reminder that free markets can solve problems that politicians argued about for decades but failed to fix.
Natural-gas reserves are plentiful but not always easy to recover. It took an individual entrepreneur, Texan George P. Mitchell, to perfect the technology of hydraulic fracturing beginning in the 1990s that has made so much more of the gas available. And fracking, it turns out, also can be used to recover oil from formations that could not previously be tapped.
Fracking technology is responsible for last year's 14% increase in oil production to 8.9 million barrels per day, the largest increase ever, and a massive, five-year increase in natural gas production, to 28 billion cubic feet a day from five billion in 2008. The increased supplies of both also are responsible for a drop in oil imports and declines in carbon-dioxide emissions to 1993 levels.
I have no idea what Mr. Mitchell's motivations were, but I'm confident that profits were at or near the top of the list. By serving his own interests, as Adam Smith put it more than 200 years ago, he served the interests of society.
The impetus for fracking cannot be found in four decades of presidential speeches about energy independence, or in any acts of Congress. Instead, it arose from economically painful spikes in oil prices engineered beginning in the 1970s by the OPEC cartel. High prices did what they always do—they set off a hunt both for substitutes and for more supplies to take advantage of high prices.
Fracking technology addresses both issues by increasing supplies of oil and of its cleaner, cheaper substitute, natural gas. These two forces—the search for substitutes and the rush to cash in on high prices—will change the nation's economy profoundly.
Another crucial factor contributed to the energy revolution. Plentiful oil and natural-gas reserves exist around the world, but the U.S. is far ahead of every other country in bringing those resources out of the ground and onto the market. The reason? America is one of the few countries where an individual or company can own the resources that lie beneath the ground.
Almost everywhere else—including even the United Kingdom—the rights to minerals of all kinds, including oil and natural gas, are claimed by the government. Unless the government wants you to drill, you might as well put your tools away. As a consequence, there is much less incentive to innovate. Why bother if you can't own what you produce, or you can't profit except at a bureaucrat's sufferance?
Today, because fracking is producing oil and natural gas at record levels, others are joining Cummins in getting into the act. Companies like T. Boone Pickens's Clean Energy Fuels are laying out a network of natural-gas filling stations on major U.S. highways so that trucks, using new engines, can fuel up. New pipelines, such as the one Spectra Energy proposes to connect New York and New Jersey, are in the works, in addition to the 16,000 miles of interstate natural-gas pipelines built over the past decade.
Most energy analysts, as well as big oil companies like Exxon, expect that the U.S. will become a net energy exporter between 2020 and 2030. When that happens, the $400 billion that Americans are on target to send overseas this year to pay for oil imports will shrink, perhaps to zero. A $400 billion swing from negative to neutral, or even to positive, in the energy trade balance is something no one would have predicted even a few years ago.
Letting markets do their work sometimes requires an act of faith. The temptation that many people have, especially in government, is to give those forces a shove in one direction or the other. But when people are allowed to use market signals to determine where and how to mobilize their creativity, resources, energy and effort, amazing things can happen. Abundant energy for the foreseeable future is one spectacular example.
Mr. Kurtzman is the executive director of the Milken Institute's Senior Fellows Program.
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"every $1 billion spent complying with an EPA rule threatens 16,000 jobs and cuts GDP by $1.2 billion—and the agency is now writing scores of multibillion-dollar rules."
http://online.wsj.com/article/SB10001424127887323683504578567533647032380.html?mod=WSJ_Opinion_LEADTop
The Carbonated President
Obama unveils a war on fossil fuels he never disclosed as a candidate.
President Obama's climate speech on Tuesday was grandiose even for him, but its surreal nature was its particular hallmark. Some 12 million Americans still can't find work, real wages have fallen for five years, three-fourths of Americans now live paycheck to check, and the economy continues to plod along four years into a quasi-recovery. But there was the President in tony Georgetown, threatening more energy taxes and mandates that will ensure fewer jobs, still lower incomes and slower growth.
Mr. Obama's "climate action plan" adds up to one of the most extensive reorganizations of the U.S. economy since the 1930s, imposed through administrative fiat and raw executive power. He wants to reduce greenhouse gas emissions by 17% by 2020, but over his 6,500-word address he articulated no such goal for the unemployment rate or GDP.
The plan covers everything from new efficiency standards for home appliances to new fuel mileage rules for heavy-duty trucks to new subsidies for wind farms, but the most consequential changes would slam the U.S. electric industry. These plants, coal-fired power in particular, account for about a third of domestic greenhouse gases.
Last year the Environmental Protection Agency released "new source performance standard" regulations that are effectively a moratorium on new coal plants. The EPA denied that similar rules would ever apply to the existing fleet, or even that they were working up such rules. Now Mr. Obama will unleash his carbon central planners on current plants.
Coal accounted for more than half of U.S. electric generation as recently as 2008 but plunged to a mere 37% in 2012. In part this tumble has been due to cheap natural gas, but now the EPA will finish the job and take coal to 0%.
Daniel Shrag of Harvard, an Obama science adviser, told the New York Times Monday that "Politically, the White House is hesitant to say they're having a war on coal. On the other hand, a war on coal is exactly what's needed." At least he's honest, though in truth Mr. Obama's target is all forms of carbon energy. Natural gas is next.
The higher costs will ripple through the energy chain, which is precisely Mr. Obama's goal. Only by artificially raising the cost of carbon energy can he make even heavily subsidized "renewables" competitive.
In general every $1 billion spent complying with an EPA rule threatens 16,000 jobs and cuts GDP by $1.2 billion—and the agency is now writing scores of multibillion-dollar rules. Keep in mind that last month the Administration quietly raised the "social cost" of carbon by 60% in a regulatory filing related to microwave ovens. That means the EPA can jack up costs by 59.99% and still justify them by claiming the higher benefits.
This regressive burden won't merely be borne by average American consumers and utility rate-payers—especially in the Midwest and Southern regions that use the most coal. This also threatens one of the few booming parts of the economy, the energy revolution driven by shale gas and unconventional oil. The return of manufacturing to the U.S. depends on this cheap abundant energy, and it could as easily re-relocate overseas as the U.S. becomes less competitive.
For good measure, Mr. Obama also declared that he will approve the Keystone XL pipeline "only if this project does not significantly exacerbate the problem of carbon pollution." Yet the oil in Alberta won't stay in the ground if Mr. Obama blocks the route to the Gulf of Mexico. It will be shipped by rail and boat to China and elsewhere. The only question is whether America will benefit from this shovel-ready project that will create tens of thousands of jobs.
Speaking of futility, Mr. Obama's ambitions will have no effect on global atmospheric carbon concentrations. Emissions are already falling in the U.S., thanks primarily to the shale gas boom, but emissions are rising in the developing world. Mr. Obama pandered to the climate-change absolutists by saying "We don't have time for a meeting of the Flat Earth Society." But he never explained how his plan will reduce warming, or why climate models have failed to predict the warming slowdown of the last dozen or so years even as more CO2 is pumped into the atmosphere.
Most striking about this Obama legacy project is its contempt for democratic consent. Congress has consistently rejected an Obama-style "comprehensive" anticarbon energy plan. That was true even when Democrats ran the Senate with a filibuster-proof majority in 2009-2010 and killed his cap-and-trade energy bill. The only legislative justification for Mr. Obama's new plan is an abusive interpretation of the Clean Air Act, which was last revised in 1990 and never mentions carbon as a pollutant.
So instead Mr. Obama will impose these inherently political policy choices via unaccountable bureaucracies, with little or no debate. Mr. Obama might have at least announced his war on carbon before the election and let voters have a say. Instead he posed as the John the Baptist of fossil fuels in locales such as Ohio, Pennsylvania and Virginia—taking credit for the shale fracking boom he had nothing to do with and running ads attacking Mitt Romney as anticoal.
Now safely re-elected, Mr. Obama figures he can do what he pleases. The Americans who will be harmed will have to console themselves with 99 weeks of jobless benefits, food stamps and ObamaCare.
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Doug,
I doubt it will hit 120 in Vegas this week. Also Tsunamis in NJ? Come on. We are being barraged with endless scare tacticts. No coincidence. Sooner or later that island will split in the Canary islands and a wave will wipe out the East Coast. So we should stop fracking?
Yes. Now he is not up for election he is ramming everything through he can. Then Hillary is going to "fight for women" against the "war on women" from the Republicans.
Women will eat it right up too.
I don't understand why taxpayers just cannot get traction? I guess there are more of them then us as Marc Levin once put it.
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CCP, Good points. As mentioned in the media issues post, they can send out a false message 92 times on broadcast multiplied by every other source that picks that up and amplifies it, call opposition flat earth, then poll on the false message and create more 'news' stories to perpetuate it. They pass or just deem economically harmful policies creating more need for government help and the downward cycle accelerates. Meanwhile, our greenhouse gases were declining without their help due to fracking they oppose and would decline much further if we built emission-free nuclear. But no, because the goal of the eco movement has always been to bring down prosperity.
Meanwhile, every politically connected crony in the green movement somehow got rich off of our failure. Go figure.
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Should the Federal Government Regulate Fracking?
Fracking supporters say it could set America on the road to energy independence and drastically change our economic prospects while helping address climate change.
But who should be in charge of regulating fracking?
Fracking—short for hydraulic fracturing—involves injecting fluids into the ground to access hard-to-reach reserves of oil and natural gas, including shale gas, which the U.S. has in vast abundance but hasn't been able to reach easily up to now.
Many advocates argue that the federal government should step in and regulate the practice more forcefully because fracking can have big environmental impacts that can't be managed effectively by individual states alone. At scale, they say, those hazards inevitably reach across state lines and become a national problem. The result could be widespread bans on the practice and a premature end to the shale-gas revolution, they say.
But others say states are well equipped to regulate fracking. They say the risks of fracking are overstated, and the impacts of fracking—both positive and negative—are mostly local, and different people balance them differently. So regulation should be left to the people who feel them most directly. Existing federal authority can handle whatever problems may spill across state lines, they say.
Jody Freeman argues for federal regulation of fracking. She is the Archibald Cox professor of law at Harvard Law School and was counselor for energy and climate change in the White House in 2009-10. Making the case that regulation should be handled by the states is David Spence, associate professor of law, politics and regulation at the McCombs School of Business and School of Law at the University of Texas.
Yes: A National Issue Can't Be Addressed State by State
By Jody Freeman
We need stronger federal regulation of fracking for a simple reason: It affects the entire nation, not just individual states.
Fracking has the potential to help the U.S. achieve energy independence, boost the economy and reduce greenhouse-gas pollution.
Yet the cumulative environmental impact of drilling at this scale is great, and it needs to be addressed in a comprehensive way. We won't achieve the full promise of fracking if environmental impacts and public reaction cause land to be pulled out of production.
Big Impacts
Fracking produces significant amounts of air pollution and methane, a potent greenhouse gas. It also generates wastewater, often containing toxic chemicals. At scale, fracking requires vast amounts of water, which can reduce regional supplies. And industrializing the countryside not only disturbs locals, it can harm habitat and wildlife.
States aren't fully up to the task of regulating these risks. And the problems inevitably cross state borders, making them a national issue.
A study by Resources for the Future, an independent research organization, showed that state standards for well integrity, wastewater management, disclosure of the content of fracking fluid and other aspects of drilling vary considerably, and some states lag far behind others. The same study reported that state enforcement capacity is generally lacking, and even states experienced with oil and gas are struggling to keep up with the pace of drilling.
Even well-intended states may lack the capacity or political will to enforce adequate protections. And there's always the chance that states may compromise standards to attract development and jobs.
States should have a strong say in the regulatory process. But we must set federal minimum standards to guarantee that no state falls below a reasonable level of care.
Coal mining offers a good analogy. Despite objections that mining was local and best handled by states, Congress passed a federal law setting minimum performance standards while giving the states the lead in implementation and letting them tailor rules to local conditions. Congress said mining was a national priority, so its risks should be addressed nationally.
The same holds for fracking. Performance standards are flexible about how to achieve environmental goals, which is important since the geology of drilling sites varies.
Building Trust
Comprehensive minimum federal standards would also help to build public trust, which is sorely needed right now.
The debate on fracking is increasingly polarized. Many jurisdictions have banned it, and more will undoubtedly do so if environmental impacts multiply. The industry is only as good as its worst operators. Support for sensible national standards would signal that the industry wants to address public concerns.
Critics of federal regulation argue that our current legal framework works fine. But fracking regulation is a patchwork of rules and jurisdictions riddled with gaps and inconsistencies.
The Interior Department has proposed standards for well integrity and public disclosure on federal lands, but state and private lands, where most fracking occurs, are exempted by Congress. The Environmental Protection Agency can regulate air and water pollution from drilling sites, but not the drilling process. Wastewater from fracked wells, though often dangerous, is excused from federal requirements for handling hazardous waste. In some states, as many as six agencies share authority over drilling.
This is not a regulatory system anyone should be proud of.
Critics of federal regulation also say that it will raise costs. On this, they are right. But critics, and especially industry leaders, should take the long view: A small increase in regulatory costs is a smart investment in the social license to operate.
Ms. Freeman is the Archibald Cox professor of law at Harvard Law School and was counselor for energy and climate change in the White House in 2009-10. She can be reached at reports@wsj.com.
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No: States Can Best Balance The Competing Interests
By David Spence
Like all forms of energy production, fracking entails risks. States are better equipped than the federal government to regulate most of those risks.
Why? Because both the benefits and the costs of fracking fall mostly on states and local communities. States gain the most from added jobs and tax revenue; they face the truck traffic, noise, pollution risks and rapid industrial growth. Consequently, states are in the best position to figure out how best to balance fracking's costs and benefits.
It is true that the natural-gas industry risks losing public trust if it doesn't perform to high standards. But turning the regulatory framework over to Washington isn't the answer.
Limited Intervention
In general, the federal government should regulate when the important impacts of the regulated activity cross state lines, when states cannot regulate efficiently or when national interests are at stake. None of these justifications apply to fracking.
Only a few of the risks of shale-gas production—methane leakage, for example—extend beyond state lines. And the Environmental Protection Agency is addressing those interstate risks already, using its existing regulatory authority.
As for the argument that states just can't handle the job of regulating, it is true that regulation lagged behind the industry's growth in some states at first. But states are quickly adapting. States are strengthening their shale-gas regulations to tighten well-construction and waste-disposal standards and require disclosure of fracking-fluid ingredients, sometimes bringing industry and environmental groups together in the process.
They're also coming up with regulatory systems that fit local conditions. Different rules for different states are necessary to match the local geography—for example, drillers may use different drilling specifications or wastewaster-disposal methods, depending upon the location.
Remember that states have been overseeing natural-gas development for decades. State oil and gas commissions have much more experience with permitting and overseeing natural-gas production than the EPA does.
Where's the Confusion?
Federal-regulation advocates also argue that the current system of multiple state and federal regulators produces a confusing patchwork of rules. But this kind of regulatory complexity is the norm in the U.S.
Few, if any, industries are overseen by a single federal agency. Not surprisingly, neither industry nor the states are clamoring for a single federal permitting regime for the fracking industry.
Some critics have worried about states lowering their standards to attract industry. But states are not competing with one another for limited natural-gas industry jobs and capital as they compete for, say, an automotive plant. To the contrary, investment capital will find profitable shale-gas production opportunities wherever they exist.
Advocates of federal regulation point to the case of coal mining, which Congress regulates based on its national importance. But coal mining and combustion produces health and environmental risks that dwarf those associated with natural-gas production.
By reducing our reliance on coal, the shale-gas boom helped push U.S. carbon emissions in the first quarter of 2012 to their lowest point since 1992—reflecting fewer emissions not just of carbon but of other byproducts of coal combustion that kill tens of thousands of people a year.
We need to continue to study fracking, and to ensure that it is done safely. Fracking offers the prospect of economic and environmental benefits, but it also presents environmental risks.
Each state is balancing those benefits and risks in its own way. Some are taking a cautious approach; others are embracing the economic benefits of shale gas more eagerly. We should continue to let states devise local solutions to what are mostly local problems.
Mr. Spence is associate professor of law, politics and regulation at the McCombs School of Business and School of Law at the University of Texas. He can be reached at reports@wsj.com.
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Should the Federal Government Regulate Fracking?
"States aren't fully up to the task of regulating these risks."
Isn't it exactly the other way around? The Federal government has been a complete failure in the regulation of the energy industry and states have presided over our greatest successes.
Let's say there is a hypothetical difference over how to regulate fracking on the border of North Dakota and Montana, a damage from one state that spills over to the other. Why not first let those two states try to resolve that before we turn to NY, Calif and DC for the 'answer'.
The answer out of Washington has been consistent. Produce no energy. Force the production to countries that are enemies of the US, who have drilling and refining etc techniques far worse than ours, then send them trillions of dollars to take up arms and attacks against us.
"Let states devise local solutions to what are mostly local problems."
Amen to that.
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Generally my biases run strongly towards state over federal.
That said, if the question presented is the contamination of an aquifer, then the contaminants will not be respecting state boundaries , , ,
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Sorry, but which aquifer was contaminated?
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I'm not saying one was, I'm saying that it is the fear of this external dis-economy which drives the conversation.
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I'm not saying one was, I'm saying that it is the fear of this external dis-economy which drives the conversation.
I appreciate that but see the motives of the opponents quite a bit more cynically. Please forgive my quibbling - as I continue to do so. :wink:
Your point posed the question, "IF (emphasis mine) the question presented is the contamination of an aquifer..."
I would like to stop you right there because I have taken the time to gather, quote and publish, in these threads, statements from the regulatory authorities of every state involved in fracking claiming that there have been no incidents to their knowledge of contaminated ground water. Please post otherwise (anyone), science, not NYT speculation. I also posted Gov. Hickenlooper's testimony to the Senate Energy committee (D-Colo.) bragging that he drank the fracking fluid: http://www.huffingtonpost.com/2013/02/13/gov-john-hickenlooper-drank-fracking-fluid-hydraulic-fracturing_n_2674453.html
The article questions, who should be in charge of regulating fracking?
I suggest that we don't regulate safe and healthy production. What we do is prohibit ground water contamination.
Please understand (everyone) that there is a war against energy production and prosperity that goes far beyond science and pollution. In war, one may need to take sides. If fracking is destroying drinking water, let's stop it. If it is not, let's legalize it. These 'regulators' in MN are trying to stop SAND from crossing state lines in order to hinder oil and natural gas production in North Dakota. Good grief. So let's give power to people even further away from it. Elites who know better than us like we do for everything else.
Let's ban dihydorgen monoxide while we're at it.
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"Let's ban dihydorgen monoxide while we're at it."
http://www.cdc.gov/HomeandRecreationalSafety/Water-Safety/waterinjuries-factsheet.html
Overview
Every day, about ten people die from unintentional drowning. Of these, two are children aged 14 or younger. Drowning ranks fifth among the leading causes of unintentional injury death in the United States.
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"I suggest that we don't regulate safe and healthy production. What we do is prohibit ground water contamination. "
Fair enough!
Allow me to restate then:
In that ground water is an interstate phenomenon (contamination will not be limited to intrastate) it seems logical the legal regime for it should be interstate, i.e. federal as well.
If I may, I think you are conflating more than one point:
a) the motives of some opponents of fracking;
b) the track record so far;
c) whether a state or federal legal regime should be the legal framework.
My point speaks specifically to the third of these; to it the first two are irrelevant.
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"I suggest that we don't regulate safe and healthy production. What we do is prohibit ground water contamination. "
Fair enough!
Allow me to restate then:
In that ground water is an interstate phenomenon (contamination will not be limited to intrastate) it seems logical the legal regime for it should be interstate, i.e. federal as well.
If I may, I think you are conflating more than one point:
a) the motives of some opponents of fracking;
b) the track record so far;
c) whether a state or federal legal regime should be the legal framework.
My point speaks specifically to the third of these; to it the first two are irrelevant.
At the risk of becoming annoying, I continue. Again, what contamination crossing state lines? Yes, federal would be the correct framework, if not for the fact we already regulate water contamination at the federal level, no new problem has been identified to be in need of a solution, the federal apparatus has proven it can bring down any industry it chooses without solving a problem, and the fact that this EPA is no longer under the control of congress nor is it a government run of, by or for the people. A federal solution should be a last case answer for what states are unable to resolve amongst themselves, which is not the case right now in fracking.
The point of this discussion right now is the implication that we need new laws and new bureaucracies to address this new and growing threat to our environment. But there are no instances. There is no letter drafted by one state alleging their water supply has been contaminated by under-regulated or under-enforced activity in another state. And it begs the question, contamination with what? Fracking fluid?
I don't think sounding off warning signals about federal government over-regulation before we head off into making a huge mistake is a small matter - or irrelevant. It is not the motives of some, but the motives of all who oppose an industry with no evidence of pollution that are in question, IMHO.
Turn this over to the Feds right now and they will destroy it. It is no small matter. North Dakota is not going to accept the energy policies of NY, Calif and DC at this point in time IMHO. Worst case isn't a destroyed industry; we may see states secede over it.
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Take the federal logic one step further out. The U.S. must share an aquifer or two with Canada, and Belgium with France etc. Isn't the only real solution for this one world government? If not, why not? We don't trusty the UN to do the right thing for the right reasons in our own best interests. Well guess what?
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"Turn this over to the Feds right now and they will destroy it."
Patience, they are working on it.
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"At the risk of becoming annoying, I continue."
No worries on my account. As best as I can tell we are just having a conversation :-)
"Again, what contamination crossing state lines?"
It would be from the fracking process.
"Yes, federal would be the correct framework"
Ah, we are in agreement then. I had not gotten this impression from your previous posts. For example, you wrote:
"Isn't it exactly the other way around? The Federal government has been a complete failure in the regulation of the energy industry and states have presided over our greatest successes. Let's say there is a hypothetical difference over how to regulate fracking on the border of North Dakota and Montana, a damage from one state that spills over to the other. Why not first let those two states try to resolve that before we turn to NY, Calif and DC for the 'answer'. The answer out of Washington has been consistent. Produce no energy. Force the production to countries that are enemies of the US, who have drilling and refining etc techniques far worse than ours, then send them trillions of dollars to take up arms and attacks against us."
This sure reads to me like favoring state over federal regulation :? Indeed, WHY do you favor federal regulation?
"if not for the fact we already regulate water contamination at the federal level,"
I am uninformed with regard to this. What is the current legal/regulatory regime.
"no new problem has been identified to be in need of a solution"
So then the point to make is there already is federal regulation.
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We are perhaps in agreement but headed different directions with this.
If there is contamination of water supplies that cross state lines, the federal government certainly could justify jurisdiction over it. But, a) we haven't seen a trace of evidence of that, b) we already have laws and enforcement mechanisms in place since the 1970s, c) the EPA as we knew it has more recently run astray and can't be trusted with any hint of new power or bureaucracy, and d) the states in with this problem, and there aren't any, already have protective agencies on both sides of any border should first try to resolve the problem, that doesn't exist, among themselves before imposing a solution, to no problem, from Washington DC.
"The contamination" would be from the fracking process." - To that I have posted that the Dem Gov of Colorado drank the fracking fluid, and all state regulatory agencies have testified no instances of contaminated drinking water from fracking. No doubt the opponents of civilization/fracking will come forward some day with East Anglia data, but for now, nothing credible has made it to these pages.
Let's ask the jurisdictional question a different, more personal way. (botched analogy warning) At what level should we regulate Martial Arts Schools that reach across state and national lines with their scope and impact? Local, state, federal, all of the above, or by some one world government that can cover the entire impact? Visualize for one thing a great, big, new federal building housing thousands of new scientists, bureaucrats and enforcement and compliance agents with unlimited budgets labeled something like the new federal bureau of martial arts school department of monitoring, enforcement, compliance and new rules generation agency committed to killing off an industry they don't like. But the right answer is none of the above. We don't have a problem, a complaint, or an incident; these schools are doing far more good than harm, and there are already plenty of far-reaching laws in existence at all of these levels to handle problems that could arise. My point is that the original question leads to a solution not needed because we have not identified a problem.
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"no new problem has been identified to be in need of a solution"
So then the point to make is there already is federal regulation.
Yes that would have been far more succinct. :-)
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"Yes that would have been far more succinct."
:-D
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We don't all possess G M's gift of brevity. :wink:
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http://www.usatoday.com/story/opinion/2013/07/02/obama-oil-supplies-column/2480881/
Steve Forbes: The U.S. is on its way to becoming the world's largest oil producer.
How much longer will we hear empty claims from President Obama, House Speaker Nancy Pelosi and Senate Majority Leader Harry Reid that the United States has only 3% of the world's oil supplies and therefore, "we can't drill our way out of the problem"? The recent increase in domestic oil and gas production is sending shock waves through the global energy economy and is bolstering the USA's standing among the energy-producing giants in the Middle East. Not only are U.S.-Middle East relations changing in a geopolitical sense, but also economically, as trade balances reflect increasing U.S. energy production.
According to a recent report from the Energy Information Administration, U.S. domestic crude-oil production in May exceeded oil imports for the first time in 16 years. Moreover, this past February, the U.S. met 88% of its own energy needs -- the highest rate since 1986. These milestones are in no small part due to the oil and natural gas boom and improved technologies such as hydraulic fracturing.
But that's not all. U.S. imports from the Organization of the Petroleum Exporting Countries have decreased more than 20% since 2010 with the International Energy Agency predicting that the U.S. could become the world's largest oil producer by 2020, and possibly energy independent by 2035.
These developments have considerable implications on U.S. foreign policy. If we continue developing our energy and manufacturing sectors, no longer will the U.S. have to kowtow to dictators of volatile nations for fear of disrupting our energy supply or rocking international markets. And we will feel far less compelled to intervene in foreign conflicts to stabilize world energy supplies. Indeed, the calculus for determining a threshold for intervention in another sovereign nation is changing in a promising way. The U.S. will always have a vested interest in a stable Middle East but the prospect -- and eventual realization -- of U.S. energy independence tips the scale and lessens the ability of rogue dictators to exercise their geopolitical control.
Decreased dependency on foreign oil doesn't just impact American foreign policy; it also opens the door for the U.S. to no longer send hundreds of billions of dollars each year to countries not always friendly to the U.S. Representatives from OPEC member countries recently complained about the impact of the largely unexpected U.S. shale boom. Oil and gas imports from Nigeria, Algeria and Angola -- three of OPEC's African members -- have decreased to their lowest levels in decades. Between 2011 and 2012, exports from those countries dropped by 41%.
Additionally, the shale gas/natural gas boom here at home could spur an energy and manufacturing renaissance that will create thousands of new, high-paying jobs in dozens of states. However this manufacturing resurgence will never fully occur if agencies such as the Environmental Protection Agency and others maintain their usual bunker mentality while mandating excessive and costly regulations that effectively block new energy and manufacturing operations.
Consider the Alaska oil pipeline, which was mired in regulatory limbo for more than five years while bureaucrats scrutinized, litigated and studied its impact. But since its completion in 1977, the Alaska pipeline has delivered more than 16 billion barrells of oil to market, while maintaining an exemplary environmental record.
The Keystone XL pipeline, which would deliver crude oil from a friendly Canada is experiencing similar delays. Under review since 2008, the Keystone pipeline has been studied more extensively than the Alaska pipeline. The delay is not only costing the U.S. cheap energy from a reliable neighbor, but also thousands of good-paying jobs.
A Renewable Fuel Standard is another example of misguided government regulation. The RFS mandates the blending of an experimental, cellulosic ethanol into gasoline and is driving up costs for refineries that are either forced to purchase renewable fuel credits or face large fines for not using a biofuel that exists in laboratories, not commercially.
Then, there are the upcoming EPA ozone standards: tougher restrictions on smog levels that by some estimates, will cost $90 billion a year just to implement. Under newly proposed EPA ozone targets, even Yellowstone National Park would be out of compliance. Many cities are still struggling to comply with 2008 standards. A recent Heritage Foundation study revealed that by the year 2100, carbon-capping policies could cost the global economy a staggering $100 trillion.
The U.S. oil and natural gas boom is drastically improving our standing in the global economy and strengthening our foreign policy might. It can also create a manufacturing boom if Washington gets out of its own way. And Americans want this energy and manufacturing renaissance to occur. A recent Gallup survey showed that 48% of Americans place higher priority on economic recovery and job growth over mandating additional environmental protections.
It's time for Washington to take heed.
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Until Obama gets out of the way energy sits in a holding pattern on the runway. Hillary will do whatever gets her the most votes. So if most people would like to open the energy tidal wave she will be for it. If environmentalists win the propaganda war she will side with them. We already know the Clintons are all poll driven. Despite what Bill recently claims with his bravery in bombing Kosovo despite what the polls said. (tail wagged the dog was the reason for that. not "courage". just self serving headline diversion).
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http://daily.represent.us/letterman-stops-joking-around-to-deliver-one-of-the-most-important-rants-ever/
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http://daily.represent.us/letterman-stops-joking-around-to-deliver-one-of-the-most-important-rants-ever/
Shocking, a Letterman show where Letterman stopped being funny. What part of no verified cases of water contamination does this political wannabe not understand?
First he says of himself, "I'm not smart enough to understand this", and I agree with him.
Second, he confirms my allegation that there is a war against fracking. He offers not a shred of new evidence. Does anyone think Letterman came up with this rant on his own? That's a joke. NYT has done entire series without offering a shred of evidence either. Just speculation of damage.
Famous people in this case not caught reading the forum, let's go over what he would know if he checked the forum first?
Letterman mentions Colorado as gone, destroyed, and Colorado was mentioned earlier today as a model state the left has taken oven, yet the environmental leftist Governor brags on Huffington Post drank the fracking fluid, meaning it is that safe. Again: http://www.huffingtonpost.com/2013/02/13/gov-john-hickenlooper-drank-fracking-fluid-hydraulic-fracturing_n_2674453.html [Left Wing] Gov. John Hickenlooper (D-CO)Tells Senate Committee He Drank the Fracking Fluid [to demonstrate it is not toxic]
I took the time to compile statements from all states involving fracking that they have no incidents reported of drinking water ever getting contaminated, and I welcome the opportunity to bring these posts forward. (Excerpted below)
As if Letterman deserves reply, there is no mystery as to what is in tap water; my city's tap water is tested and measured every year, based not on corporate greed, but on the existing requirement of ample federal, state and local laws already in place. The mention of methane discovered in water is quite frightening, implied by fire in the faucets, but this was not new nor caused fracking. http://dogbrothers.com/phpBB2/index.php?topic=1118.msg51022#msg51022 Where in science or logic did THAT connection come from? Both water and natural gas come from the ground. One didn't cause the other unless you present evidence that it did. Screw Letterman, the question is what gives Crafty and others with informed logic their skepticism of America's two cleanest forms of energy. Would you prefer dirty energy from farther away, or doing without energy and our fleeting prosperity?
"U.S. CO2 Emissions Hit 20 Year Low" - Why?? Fracking. What say Letterman (and NYT) about THAT? (Emissions would be lower yet if we were also building up our nuclear capacity.)
http://dogbrothers.com/phpBB2/index.php?topic=1096.msg68520#msg68520
Did anyone read all of this long post, debunking NYT/Letterman bunk and ending with statements of the existing regulatory authorities:
http://dogbrothers.com/phpBB2/index.php?topic=1096.msg46669#msg46669
Hydraulic Fracturing –15 Statements from Regulatory Officials
http://www.hydraulicfracturing.com/Documents/Hydraulic_Fracturing_SGEIS_comments.pdf
"In recent months, the states have become aware of press reports and websites alleging that six states have documented over one thousand incidents of ground water contamination resulting from the practice of hydraulic fracturing. Such reports are not accurate." - President of the Ground Water Protection Council
"After 25 years of investigating citizen complaints of contamination, DMRM geologists (Ohio Division of Mineral Resources Management) have not documented a single incident involving contamination of ground water attributed to hydraulic fracturing." - Ohio Department of Natural Resources
After review of DEP's [Pennsylvania Department of Environmental Protection] complaint database and interviews with regional staff that
investigate groundwater contamination related to oil and gas activities, no groundwater pollution or disruption of underground sources of drinking water has been attributed to hydraulic fracturing of deep gas formations. - Pennsylvania Department of Environmental Protection
"we have found no example of contamination of usable water where the cause was claimed to be hydraulic fracturing." - New Mexico Energy, Minerals and Natural Resources Department
"I can state with authority that there have been no documented cases of drinking water contamination caused by such hydraulic fracturing operations in our State." - STATE OIL AND GAS BOARD OF ALABAMA
"Though hydraulic fracturing has been used for over 50 years in Texas, our records do not indicate a single documented contamination case associated with hydraulic fracturing." - chief regulatory agency over oil and gas activities in Texas
"There have been no verified cases of harm to ground water in the State of Alaska as a result of hydraulic fracturing." - Commissioner Alaska Oil and Gas Conservation Commission
"To the knowledge of the Colorado Oil and Gas Conservation Commission staff, there has been no verified instance of harm to groundwater caused by hydraulic fracturing in Colorado."
"There have been no instances where the Division of Oil and Gas has verified that harm to groundwater has ever been found to be the result of hydraulic fracturing in Indiana." - Director, Indiana Department of Natural Resources
"The Louisiana Office of Conservation is unaware of any instance of harm to groundwater in the State of Louisiana caused by the practice of hydraulic fracturing."
"My agency, the Office of Geological Survey (OGS) of the Department of Environmental Quality, regulates oil and gas exploration and production in Michigan. Hydraulic fracturing has been utilized extensively for many years in Michigan, in both deep formations and in the relatively shallow Antrim Shale formation. There are about 9,900 Antrim wells in Michigan producing natural gas at depths of 500 to 2000 feet. Hydraulic fracturing has been used in virtually every Antrim well. There is no indication that hydraulic fracturing has ever caused damage to ground water or other resources in Michigan."
"No documented cases of groundwater contamination from fracture stimulations in Wyoming."
Link: Hydraulic Fracturing –15 Statements from Regulatory Officials
http://www.hydraulicfracturing.com/Documents/Hydraulic_Fracturing_SGEIS_comments.pdf
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" Screw Letterman, the question is what gives Crafty and others with informed logic their skepticism of America's two cleanest forms of energy"
Ummm , , , sorry for my lack of clarity; I strongly favor the development of our natural gas via fracking-- though I do think that it would be a good idea politically if people were to be made aware of a watchful regulatory eye making sure nothing goes wrong.
I posted Letterman's remarkably uninformed rant precisely to let you tee off :-D
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Thanks. And I teed that one up for you. Your clarity is appreciated!
People read certain publications and assume we already proved fracking is killing us. Like Letterman's writers, I oppose poisoning the planet; I just wish they would cite one credible instance before we shut down the American economy. As I posted previously, imagine what our 0.0% growth rate looks like without the boom in energy, and none of it coming from federal lands. The political-regulatory war against fracking isn't hypothetical. Too bad it is synonymous with a war against science.
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http://spectrum.ieee.org/energy/renewables/unclean-at-any-speed
most electric-car assessments analyze only the charging of the car. This is an important factor indeed. But a more rigorous analysis would consider the environmental impacts over the vehicle’s entire life cycle, from its construction through its operation and on to its eventual retirement at the junkyard.
One study attempted to paint a complete picture. Published by the National Academies in 2010 and overseen by two dozen of the United States’ leading scientists, it is perhaps the most comprehensive account of electric-car effects to date. Its findings are sobering.
...
The materials used in batteries are no less burdensome to the environment, the MIT study noted. Compounds such as lithium, copper, and nickel must be coaxed from the earth and processed in ways that demand energy and can release toxic wastes. And in regions with poor regulations, mineral extraction can extend risks beyond just the workers directly involved. Surrounding populations may be exposed to toxic substances through air and groundwater contamination.
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an electric car is likely worse than a car fueled exclusively by gasoline derived from Canadian tar sands!
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Upon closer consideration, moving from petroleum-fueled vehicles to electric cars begins to look more and more like shifting from one brand of cigarettes to another.
http://spectrum.ieee.org/energy/renewables/unclean-at-any-speed
http://www.nap.edu/catalog.php?record_id=12794
http://pubs.acs.org/doi/abs/10.1021/es203518d
http://onlinelibrary.wiley.com/doi/10.1111/j.1530-9290.2012.00532.x/abstract
http://www.utk.edu/tntoday/2012/02/13/researchers-find-ecar-emissions-harmful/
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Did you mention all the coal that is burned in producing the electricity which is used to charge the batteries?
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As environmental disasters go, the explosion Saturday of a runaway train that destroyed much of the Quebec town of Lac-Mégantic, about 20 miles from the Maine border, will probably go down the memory hole.
It lacks the correct moral and contains an inconvenient truth.
Not that the disaster lacks the usual ingredients of such a moral. The derailed 72-car train belonged to a subsidiary of Illinois-based multinational Rail World, whose self-declared aim is to "promote rail industry privatization." The train was carrying North Dakota shale oil (likely extracted by fracking) to the massive Irving Oil refinery in the port city of Saint John, to be shipped to the global market. At least five people were killed in the blast (a number that's likely to rise) and 1,000 people were forced to evacuate. Quebec's environment minister reports that some 100,000 liters (26,000 gallons) of crude have spilled into the Chaudière River, meaning it could reach Quebec City and the St. Lawrence River before too long.
Environmentalists should be howling. But this brings us to the inconvenient truth.
The reason oil is moved on trains from places like North Dakota and Alberta is because there aren't enough pipelines to carry it.
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Pipelines account for about half as much spillage as railways on a gallon-per-mile basis. Pipelines also tend not to go straight through exposed population centers like Lac-Mégantic. Nobody suggests that pipelines are perfectly reliable or safe, but what is? To think is to weigh alternatives. The habit of too many environmentalists is to evade them.
...
In 2001, the U.N.'s Intergovernmental Panel on Climate Change insisted that "global average surface temperatures [will rise] at rates very likely without precedent during the last 10,000 years," and that they would rise sharply and continuously.
Yet in the 15 years since 1998, surface air temperatures have held flat, a fact now grudgingly conceded by the climate-science establishment, despite more than 100 billion tons of carbon dioxide having been pumped into the atmosphere over the same period.
...
The world needs a credible environmental movement. Conservation matters. So does the quality of water and air.
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The first application for a Keystone XL pipeline permit was filed with the U.S. State Department in 2008. Since then, the amount of oil being shipped on rails has risen 24-fold. Environmentalists enraged by this column should look at the photo of Lac-Mégantic that goes with it, and think it over.
Read it all at the link:
http://online.wsj.com/article/SB10001424127887323368704578593562819939112.html
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http://www.seattlepi.com/business/energy/article/DOE-study-Fracking-chemicals-didn-t-taint-water-4674134.php?cmpid=twitter
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http://www.seattlepi.com/business/energy/article/DOE-study-Fracking-chemicals-didn-t-taint-water-4674134.php?cmpid=twitter
I will be waiting on Letterman's apology.
Readers of the forum knew this 2 1/2 years sooner:
http://dogbrothers.com/phpBB2/index.php?topic=1096.msg46669#msg46669
DOE, CBS, AP now picking it up the story:
A landmark federal study on hydraulic fracturing, or fracking, shows no evidence that chemicals from the natural gas drilling process moved up to contaminate drinking water aquifers at a western Pennsylvania drilling site, the Department of Energy told The Associated Press.
http://www.cbsnews.com/8301-201_162-57594498/study-finds-fracking-chemicals-didnt-pollute-water-ap/
What would the result of the study be if the nation followed NY or Calif law? Result inconclusive. Insufficient data. Leave clean burning natural gas in the ground. Meanwhile China and India are building 4 new coal plants per week: http://www.thegwpf.org/china-india-building-4-coal-power-plants-week/
Forget about natural gas, the US govt restricts the use of unpowered sailboats while India and China are building 4 new coal plants per week. http://www.bwca.cc/tripplanning/rules.htm
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http://blogs.the-american-interest.com/wrm/2013/07/29/saudi-prince-us-shale-threatening-our-economy/
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http://blogs.the-american-interest.com/wrm/2013/07/29/saudi-prince-us-shale-threatening-our-economy/
Of course they do, lucky for them, our president will protect their interests above ours.
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http://blog.heritage.org/2013/08/06/wind-power-only-when-the-wind-blows-and-the-subsidies-flow/
Wind Power: Only When the Wind Blows and the Subsidies Flow
Nicolas Loris, August 6, 2013
Wind turbines produce power only when the wind is blowing. But perhaps more importantly, wind production builds only when the subsidies are flowing.
The wind industry is experiencing slow growth through the first half of the year and blaming uncertainty over a massive subsidy as a reason why. Alex Guillen of Politico reported last week that the United States added only 1.6 megawatts of wind power in the first half of 2013, which is far less than the 13 gigawatts installed last year and significantly smaller than the 3 gigawatts of new power installed over the first half of 2012.
The fact that the wind production experiences significant declines when the subsidy expires is not a good reason to extend it; in fact, it’s a good reason to permanently remove it.
The wind industry is confident that installation will pick up towards the end of year and that the uncertainty over the extension of the tax credit created the lag in production for the year. But what is most important, however, is just how dependent wind production is upon subsidies, as well as state mandates for renewable electricity generation.
Congress first passed the wind production tax credit (PTC) in 1992 but allowed it to expire several times. The PTC expired in 2000, 2002, and 2004, and annual wind installation decreased by 93 percent, 73 percent, and 77 percent, respectively. Wind energy advocates call this a boom-and-bust cycle created by unstable policy, but it is more likely a case of the wind PTC’s oversupplying a market and artificially propping up a large portion of wind production.
The complaint from wind advocates is that there’s no business certainty. While there may be uncertainty as to whether politicians cave and extend the PTC another year or two, the wind industry knew the expiration was coming for years. If they wanted policy certainty, they should have stopped lobbying for an extension.
Removing the energy subsidies would eradicate the near-term dependence but also promote long-term growth within the industry. The part of the wind industry that doesn’t depend on the PTC would be the more robust, competitive part and would provide consumers with affordable energy. Until the training wheels are taken off, however, the industry will not have the strongest incentive to innovate and lower costs to become economically viable and instead will concentrate efforts on lobbying for handouts.
Even Patrick Jenevein, CEO of the clean energy firm Tang Energy Group, affirmed in The Wall Street Journal the problems with his own industry’s dependence on subsidies:
Government subsidies to new wind farms have only made the industry less focused on reducing costs. In turn, the industry produces a product that isn’t as efficient or cheap as it might be if we focused less on working the political system and more on research and development.
The wind PTC is again set to expire at the end of the year. To provide certainty, save taxpayers billions of dollars, and promote healthy competition in the energy sector, Congress should let it expire and work to remove all energy subsidies for all sources.
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Are Democrats About to Fracture Over Fracking?
http://www.nationaljournal.com/politics/are-democrats-about-to-fracture-over-fracking-20130817
Asked whether natural gas is important to the state's economy, 77 percent of Pennsylvania Democrats said it was somewhat or very important. Just 22 percent called it not very important or not important at all.
- survey taken by Muhlenberg College in Allentown, Pa. and the University of Michigan
"The flip side to appeasing the environmental lobby is that you open yourself up to getting roasted on killing jobs in Pennsylvania," said one Democrat working one of the campaigns.
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(The point of fracking is that natural gas is a far cleaner and more efficient energy source for things like heating homes and powering manufacturing facilities than coal, oil. etc., not just a a gain of local drilling jobs.)
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Ironic that he opposes this...
" it increased US disposable income by an average of $1,200 per US household in 2012 thanks to smaller energy bills as well as lower embedded energy costs in all other goods and services"
"Combined with upstream activity, the entire unconventional oil and gas value chain currently supports more than 2.1 million jobs."
More evidence the shale revolution probably got Obama reelected
James Pethokoukis | September 4, 2013, 9:15 am
http://www.aei-ideas.org/2013/09/more-evidence-the-shale-revolution-probably-got-obama-reelected/
President Obama really should visit North Dakota and see for himself America’s energy revolution. A new report from IHS Global Insight highlights just how much impact unconventional oil and gas activity may be having on the US economy. For starters, it increased US disposable income by an average of $1,200 per US household in 2012 thanks to smaller energy bills as well as lower embedded energy costs in all other goods and services. IHS thinks that figure will to grow to just over $2,000 in 2015 and reach more than $3,500 in 2025.
Then there are the jobs:
The new study widens the breadth of the research to include the full energy value chain (upstream, midstream and downstream energy and energy-related chemicals) and the overall macroeconomic contributions on the manufacturing sector and broader U.S. economy. Midstream and downstream unconventional energy and energy-related chemicals activity currently support nearly 377,000 jobs throughout the economy, the study finds. Combined with upstream activity, the entire unconventional oil and gas value chain currently supports more than 2.1 million jobs. Total jobs supported by this value chain will rise to more than 3.3 million in 2020 and reach nearly 3.9 million by 2025.
Without the shale revolution, election year 2012 might have seen the official unemployment over 9% in November instead of 7.8%. And the average American would have faced a higher cost of living and lower income. More importantly now, the US energy industry continues to be a real economic bright spot.
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Canada PM Ready to Introduce New Carbon-Emission Rules for Keystone Approval
http://online.wsj.com/article/BT-CO-20130906-710160.html
OTTAWA--Canadian Prime Minister Stephen Harper has told U.S. President Barack Obama that he's ready to work on joint plan between the two countries to reduce carbon emissions in the energy sector in an effort to secure approval of the Keystone XL pipeline project, the Canadian Broadcasting Corp. reported Friday.
The CBC, citing unnamed sources, said Mr. Harper wrote to Mr. Obama in late August, signaling he is ready to accept carbon-reduction targets proposed by the U.S. and prepared to work with the White House to address concerns raised about Keystone and its impact on greenhouse-gas emissions.
A spokesman for Mr. Harper declined to comment on any correspondence between the Canadian and U.S. leaders. A White House spokesperson declined to confirm Mr. Obama had received Mr. Harper's letter.
TransCanada Corp.'s (TRP) proposed Keystone XL project, which would carry heavy crude from Alberta to the U.S. Gulf Coast, has sparked high-profile and vocal opposition from U.S. and Canadian environmentalists, who are concerned it will encourage to further development of the oil sands. The project is presently under review by the U.S. State Department, but ultimate approval rests with Mr. Obama -- who has said approval would hinge on the pipeline project's impact on greenhouse-gas emissions.
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Re: Energy Politics - More evidence that 'Fracking' got Obama reelected
« Reply #490 on: September 05, 2013, 11:21:52 AM »
" it increased US disposable income by an average of $1,200 per US household in 2012 thanks to smaller energy bills as well as lower embedded energy costs in all other goods and services"
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I am always pleased to see the nation's leading newspaper pick up and run with the themes (previously) discussed here. :wink:
WSJ. REVIEW & OUTLOOK, September 9, 2013, 8:08 p.m. ET
More on Fracking and the Poor
The U.S. oil and gas boom added $1,200 to disposable income in 2012.
"The irony Washington will never appreciate is that fracking has done more for the less fortunate in the Obama years that all of its ministrations combined."
More at link: http://online.wsj.com/article/SB10001424127887324094704579065432802151184.html?mod=WSJ_Opinion_AboveLEFTTop
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WSJ
Target: Natural Gas
Ron Binz calls it a 'dead end' technology, and he'll try to make it so.
The oil and gas fracking boom increased household disposable income by $1,200 last year as lower energy costs flowed to consumers, according to a new study from IHS Global Insight. So Americans may want to know that President Obama's nominee to chair the Federal Energy Regulatory Commission (FERC) thinks natural gas is a "dead end."
That nominee is Ron Binz, and in March 2013 he spoke at an Edison Foundation panel on utilities and green technologies. To fight global warming, he argued, government must adopt a "new regulatory model, because that's where it's going to start."
Duke Energy CEO Jim Rogers challenged him by noting that the 2009 Pelosi cap-and-trade bill hadn't passed, yet utilities have since cut carbon emissions sharply by switching to natural gas from coal. This shift is "an incredible example" of how "policy didn't get done, but at the end of the day technology produced the result. You seem to believe that this transition will only happen if it's driven by policy," Mr. Rogers asked.
"Well, natural gas is a good example," Mr. Binz replied, meaning of his policy preferences. "It's been called for many years a transition fuel. The industry has sort of jettisoned that label lately. It seems to be a permanent fuel. On a carbon basis you hit the wall in 2035 or so with gas. I mean, you do."
Enlarge Image
image
image
Bloomberg
PacifiCorp Lake Side 2 natural gas power plant under construction in Vineyard, Utah
Mr. Binz said switching to gas might be "a good move" for the interim, "but we also need to understand that without CCS, without carbon capture and storage, I think that's a dead end, a relative dead end—it won't dead end until 2035 or so. But that's when we need to do better on carbon than even natural gas will allow us to do under current assumptions."
So there it is: Natural gas is a dead end not because there will be too little gas but because by 2035 it won't reduce carbon emissions as much as Mr. Binz wants.
Naturally, Mr. Binz's alternatives to gas are green "renewables" like wind and solar. Or so he said at a November 2012 forum at the University of Denver, citing research from the federal National Renewable Energy Laboratory. The 2012 study does show that the 80% scenario is theoretically possible, but only if the assumptions are wildly unrealistic. The lab assumes that gas as a share of the U.S. power mix could plunge to 3% by 2050 from 16% in 2010, and coal to 9% from 51%. Wind will climb to 39% from 2%, and solar from 0.01% to 7%.
Mr. Binz wants to make that happen, and don't worry about the costs of the transition. He said that this "renewable energy future was no more costly, or in the realm of the same cost, as any other clean technology. In other words, if you accept that we're going to have to make these reductions in carbon and in other criteria pollutants, renewables are not going to be more expensive as a total package than other proposals such as nuclear, such as carbon sequestration from coal and natural gas."
Note those words "we're going to have to make these reductions in carbon." This is a man whose overriding policy motivation is making carbon more expensive so it can be phased out of the U.S. economy.
In Denver, Mr. Binz also instructed the audience that "We're coming off an election where one of the themes was, we're all in this together. And I think that is the kind of message that needs to be stressed. One utility's exhalation of carbon dioxide is everybody's problem.
"This is not a situation where it's okay to be with a clean utility and it's okay to let other customers go their own way, because there's a commonality here. I think we need to keep preaching that. We have a bias toward individualism in this country, which can work for great things, but it can also at times prevent us from doing societal things, and there's really no substitute for doing that right now."
Such thinking ought to scare the daylights out of Senators from fossil-fuel states because it shows how Mr. Binz will operate at FERC. The supposedly independent agency oversees much of the gas business—from pipelines to export terminals to trading markets. It also has a narrow role to ensure that electricity is affordable and reliable, which Mr. Binz interprets to mean a mandate for whatever his carbon-free paradise requires.
Senators should also pay attention because Mr. Binz words are a rare public admission of what the green left really thinks about natural gas. Liberals loved gas when it was scarce and expensive. But now that it is abundant and cheap, gas poses a threat to the dream of an economy run solely on mandated renewables. So the strategy is to use regulation to slowly make natural gas more expensive again.
That will be Mr. Binz's job at FERC. In Denver he mused about the reasons some states use more renewables than others and "the answer I think to my own question is it's policy, it's regulation, it's industry structure and it's incentives we provide for this. It's not physics, it's not chemistry, it's not even the electric grid. It's what we decide we want."
By "we" he means Mr. Obama and himself.
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Surprise.
"Mr. Binz said switching to gas might be a good move for the interim, but..."
Then do it for the interim.
Unless what you really want is to shut down the economy.
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More than 12 years ago, the Cheney task force made recommendations like: "repair and add onto the existing network of refineries, pipelines, generators and transmission lines. ...the refining and distribution of natural gas was effected by an inefficient and inadequate infrastructure, and that this issue could be remedied by 38,000 miles of new pipeline and 255,000 miles of distribution lines"
We mostly ignored that advice. Now we pay the price, in spite of all the increased production of oil via fracking.
The policy of keeping gas prices high is now intentional. Who does it hit worst? The working poor and struggling lower middle class who rely on it to get to work, do their work or look for work. Is that what we want? Maybe not, but is the result of our elections and policies.
http://www.cnbc.com/id/101039695
Gas prices set record: 1,000 days above $3 a gallon
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http://freebeacon.com/ecotality-files-for-bankruptcy/
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second post
http://online.wsj.com/article/SB10001424127887323981304579079400039800412.html?mod=WSJ_hp_LEFTWhatsNewsCollection
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In energy milestone, EQT in first-ever fracking job powered only by well gas • 2:11 PM
•EQT Corp. (EQT +1.5%) and Green Field Energy say they completed the first fracking job powered solely by natural gas tapped from a nearby well, using well gas to complete jobs on a Marcellus shale well in Pennsylvania.
•Some operators, including Apache (APA), have estimated that using well gas could cut fuel costs by 70%; APA has said that if all fracking jobs switched to well gas, energy companies could cut their industry-wide fuel costs by $1.67B.
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http://online.wsj.com/article/SB10001424127887323981304579079400039800412.html?mod=WSJ_hp_LEFTWhatsNewsCollection
Will any of these positive developments slow the opponents? No.
More on the story here: http://blogs.the-american-interest.com/wrm/2013/09/17/study-gives-fracking-green-bill-of-health/
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Investors Business Daily says: Fracking Leads To Cleaner Air
(http://www.investors.com/image/A1art_120821_345.png.cms)
http://news.investors.com/ibd-editorials/082012-622858-fracking-drops-carbon-emissions-to-new-low.htm
Will that deter the opponents? No.
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Besides opposing transportation fuels, liberals oppose 87% of current electricity sources.
Good luck with job growth under current leadership.
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http://www.jamestownsun.com/event/article/id/195493/group/News/
...a pending regulation aimed at limiting global warming pollution from new power plants that Republicans and the coal industry say will doom the fuel source.
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http://www.eia.gov/tools/faqs/faq.cfm?id=427&t=3
What is U.S. electricity generation by energy source?
Fossil fuels 68% + Nuclear power 19% = 87% of current electricity sources
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There was a piece on 60 minutes or a comparable program a few years ago that explored pumping carbon emissions into the ground. It is feasible but at that time would cost a trillion dollars to convert to this.
With regards to pumping carbon into frack wells I just posted that using nat gas itself would reduce costs of fracking by 70%. So that said I still don't know what will happen to coal of which I own some stock in.
Good summary from Forbes on this stuff:
*****Ken Silverstein
Ken Silverstein, Contributor
I write about the global energy business.
9/20/2013 @ 8:00AM
Coal Could Be Resurrected If Carbon Could Be Buried
It’s a big day for coal-fired power plants, which will formally learn the Obama administration’s plans on how they are to be regulated. The proposal, which if enacted, would set strict limits on carbon dioxide releases that would essentially nullify the future construction of coal facilities.
That’s at least until carbon capture and sequestration (CCS) would become commercial. That’s not possible now. But what is possible is to capture the carbon dioxide (CO2) from power plants and to it use for enhanced oil recovery. That tool, however, is not without controversy: Critics say that pumping such heat-trapping emissions into the ground only so that they could be used to extract a product that releases even more such global warming pollution is a bit silly.
“Leaving the CO2 underground is of no ultimate benefit for climate stabilization when additional hydrocarbons have been extracted in exchange,” says Jeffrey Michel, an MIT scholar and environmental professional living in Germany. Michel, who is a contributor to EnergyBiz Insider, goes on to say that injecting 1 ton of carbon dioxide will yield 3.6 barrels of crude oil. That, in turn, creates 1.4 tons of carbon dioxide when refined and burned.
That said, the thinking among some climate scholars is that taking the CO2 and using it to retrieve oil deposits is a better solution than letting it into the atmosphere. And, it is the best answer until the releases can be captured and permanently buried, which the U.S. Department of Energy Secretary Ernest Moniz told a congressional panel this week that this happen before 2020.
U.S. lawmakers from coal-producing states are expressing reservations about the Obama administration’s proposals, which would require all future coal plants to be as clean as combined cycle natural gas facilities. Or, technically speaking, today’s coal units spew out about 1,850 pounds of carbon per megawatt hour while the proposal is expected to cap that at 1,000 pounds. To do so, they would need to have the ability to employ CCS.
Moreover, coal producers in the United States, such as Alpha Natural Resources ANR -0.3%, Arch Coal and Peabody Energy BTU -0.74%, will find that oversea’s markets won’t provide long-term refuge. China and India, for example, are also developing much stronger coal regs. China’s coal-burning is to peak at 4 billions tons by 2015, say news reports. After that, it will begin a gradual descent, relying instead on hydro, nuclear and renewables.
Here in the United States, 112 coal plants have been retired since 2010, or soon will be, says Beyond Coal, totaling more than 48,000 megawatts. Doyle Trading Consultants generally agrees, saying 42,000 megawatts are vulnerable to retirement by 2020, 90 percent of which will fade away by 2015. That’s 18 percent of the existing coal-fired fleet.
Domestically, coal’s share of the electric generation market has fallen from 50 percent in 2007 to 40 percent now. But, globally, it is still expected to fuel the developing economies, supplying 60 percent of the power markets through 2035. If the coal sector, however, wants to prevent a precipitous decline in its overall status, it must embrace CCS, and Secretary Moniz says that this country will partner with U.S. utilities and their coal providers.
To that end, CCS for applications related to coal and gas-powered electricity remain hugely expensive, necessitating further research development. So, the Center for Climate and Energy Solutions is pushing carbon capture and utilization — to increase oil finds.
“CCS is a critical technology for reconciling our continued dependence on fossil fuels with the imperative to protect the global environment,” says Judi Greenwald, vice president for technology at the Center for Climate and Energy Solutions. “Our best hope at the moment for CCS advancement is carbon capture, utilization and storage,” which takes the captured carbon and uses it for enhanced oil recovery.
She points to two projects: Air Products’ Port Author and Southern Company’s Mississippi venture. The U.S. Department of Energy helped support the Air Products project, where carbon dioxide is captured from a refinery and then used to enhance oil recovery. In late 2012, it began operations. The Energy Department pumped in $284 million of the total $430 million cost. Similarly, the agency is working with Southern Co SO -0.77%. at its facility in Mississippi. Here, the public’s contribution is $290 million. The project is more than 80 percent complete.
The ultimate goal is to permanently bury the carbon. The Energy Department is putting up $1.1 billion or 80 percent of the money to build “FutureGen.” The facility is expected to be 200 megawatts that will retrofit an oil-fueled unit in Meredosia, Illinois. The project is now focused on its preliminary design and engineering. It will capture at least 90 percent of the CO2 emitted, and it will inject all of that underground, the organization explained.
For their part, utilities say that they would eagerly participate with the federal government while it is investing $8 billion in CCS. But they also note that over the last 40 years that they have collectively spent $100 billion on such things as scrubbers and coal gasification. To that end, the industry says that the attention should be on advancing those technologies that are currently commercial — not in forsaking the progress that has been made.
“Perhaps the federal government should first focus on ensuring the coal industry can economically build second generation plants rather than put a halt to the innovative progress made to date,” says Laura Sheehan, spokeswoman for the American Coalition for Clean Coal Electricity. “If the EPA acts as expected, the United States, which is the current global leader of CCS technology, will fall to the back of the innovation race.”
Obama’s immediate plan is to apply the CO2 limits to all prospective coal plants. His eventual aim is to impose similar caps on the existing coal-fired fleet. And all this is taking place in an electric generation market where natural gas is quickly gaining market share because of its abundance and cost.
In other words, both the regulatory and economic climate are evolving. That is why the coal industry and its utility partners have to stop stalling and start allocating the necessary resources to allow their offerings to remain relevant. Gasifying coal is a potential answer. Carbon capture is another.
While using CO2 to enhance oil recovery is within reach, it remains controversial. Nevertheless, it is an essential first step to permanent sequestration*****
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Born-Again Fracker
Energy nominee Ron Binz undergoes a confirmation conversion.
Ron Binz faced the Senate Energy Committee on Tuesday, and the event was something of a miracle. President Obama's nominee to run the Federal Energy Regulatory Commission (FERC) declared heretofore undetected devotion to natural gas and regulatory restraint.
Mr. Binz's nomination is in trouble because of a record and philosophy hostile toward fossil fuels of any kind. As recently as March he derided natural gas as a carbon-heavy "dead end," and he showed as a Colorado regulator that he's willing to stretch the law and manipulate companies to promote wind and solar over other kinds of power.
Thus the confirmation conversion. On Tuesday Mr. Binz said that he had spoken "probably uncarefully" about natural gas, and "that was a relatively inartful way of saying it." Now he says that "I fully embrace the use of natural gas," which he also called "the near-perfect fuel for the next couple of decades."
In case that wasn't enough enthusiasm, he added that natural gas is "a very great fuel," "a very important fuel" and "a terrific fuel. It's needed right now, and maybe in the permanent energy mix." He touted "a boom in jobs in the gas industry" and "a great resource" that's "getting larger by the minute as we discover more and more opportunities to develop shale gas." Tom Steyer, the anti-carbon billionaire pushing Mr. Binz for the job, must have cringed at all that.
Mr. Binz must have found it even more painful to disavow any policy-making role at FERC. He has written extensively about how regulators should go beyond the confines of the law to dictate "desired societal outcomes," and he has mused that as Colorado public utility commissioner from 2007-2011 he saw himself "not simply as an umpire calling balls and strikes, but also as a leader on policy implementation."
On Tuesday Mr. Binz flipped and promised he wouldn't even lead from behind. FERC's duty is only "to promote the appropriate infrastructure investments" like gas pipelines and electric transmission, he said. "Now that's not just a passive process. It is mainly passive in the sense that we—at the FERC, if I'm appointed at FERC, we'll receive applications from businesses to build things."
Energy Chairman Ron Wyden also tried to help the nominee by suggesting no fewer than eight times that Mr. Binz's views are irrelevant because of FERC's narrow legal powers. Mr. Binz has said he wants 80% of U.S. electricity to come from renewables, but Mr. Wyden said "Mr. Binz would have absolutely no authority to do anything on this matter."
Too bad that's not true. FERC can pick electricity winners and losers because a grid that is designed for, say, natural gas and nuclear power works very differently from one that primarily moves solar and wind. FERC is already starting to discriminate in favor of the latter when it reviews applications for power lines. Mr. Binz will almost certainly perpetrate more such abuses to punish fossil fuels.
The White House is worried that Mr. Binz may lose on an 11-11 tie in committee, so it is leaning on Louisiana Democrat Mary Landrieu to vote in favor. Ms. Landrieu is thus caught between her state's fossil-fuel economy and the green money she needs from the likes of Mr. Steyer to win re-election. We assume she knows that the original Ron Binz is the real one.
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http://www.anncoulter.com/columns/2013-09-25.html#read_more
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Second energy post today also from the Economist:
http://www.economist.com/news/technology-quarterly/21584436-automotive-technology-electric-and-hybrid-cars-are-being-given-run-their
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Fill it up in your garage!
Never thought of this.
My first thought is this safe?
I notice the tank is not shown. I am guessing the entire trunk is the fuel tank:
http://news.yahoo.com/photos/natural-gas-powered-cars-1380888123-slideshow/
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I didn't know Exxon holds the most patents in this area. From Scientific American.
http://blogs.scientificamerican.com/plugged-in/2013/10/15/will-oil-companies-become-carbon-capture-ones/
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I didn't know Exxon holds the most patents in this area. From Scientific American.
http://blogs.scientificamerican.com/plugged-in/2013/10/15/will-oil-companies-become-carbon-capture-ones/
As always, Big Regulation will take from the freedom and choice of the little guy and give to the corporate profits of the largest, entrenched contributors. I hope it is worth it.
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Short oil.
http://finance.yahoo.com/blogs/daily-ticker/al-gore-carbon-bubble-going-burst-avoid-oil-121707563.html
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Of course the Palestinians will lay claim to this source of wealth.
Personally, and sadly I am hesitant to invest in anything Israeli. Too much political uncertainty.
****The Motley Fool
This Natural Gas Find Could Completely Change the World As We Know It
By Tyler Crowe
November 3, 2013
One thing that makes the energy sector so intriguing is the constant overlap between markets and politics. In many ways, energy security is synonymous with national security, and the supply and demand needs of the oil market can make the most unlikely bedfellows. One country that has been at the center of energy and politics for decades has been Israel. For years the country has been dependent upon foreign energy sources, but a major discovery by Noble Energy (NYSE: NBL ) and its partners has turned this situation on its head. Let's look how this massive natural gas find could affect both the political landscape and the pockets of major oil companies like ExxonMobil (NYSE: XOM ) .
With a name like Leviathan, it has to be big
In 2010, Noble Energy and its partners found something in Israel's offshore region that the country had been looking for since the oil embargoes of the 1970's; its own hydrocarbons. You might say that the company and the country found more than they could have hoped for. The Tamar and Leviathan fields are estimated to have as much as 30 trillion cubic feet of natural gas, which is enough gas to supply Israel for decades even if it were to convert all of its energy consumption from coal and oil to natural gas -- with enough left over to export. Noble Energy estimates that this gas field and the planned export projects could net the country more than $130 billion in energy savings and government revenue from gas royalties.
Of course, Israel isn't the only one making out from this deal, either. The nation's proven reserves account for more than 30% of Noble's proved reserves, and will likely be one of the company's premier energy plays for decades to come. On top of that, the U.S. Geological Survey estimates there are more than 600 million barrels of recoverable oil in the Leviathan field, which could boost the company's reserves by another 17%.
Game of Therms
Thirty trillion cubic feet of natural gas and 600 million barrels of oil is not a monumental amount in terms of the global energy landscape. But the combination of the size of the find, its proximity to a major demand center (Europe), and the fact that it's found in Israel could lead to several issues that might leave some major oil and gas powers not too happy.
Israel could disrupt the energy markets via liquefied natural gas terminals or a combination of pipeline and electricity cables. Noble has brought on Australian partner Woodside Petroleum to develop an LNG terminal for the Leviathan gas field and potentially a second site for an adjacent gas field in Cyprus. The Leviathan LNG terminal is projected to export about 0.85 billion cubic feet per day. Again, not much, but enough to displace 15% of the LNG market in Western Europe.
More importantly, though, Noble estimates that Israeli and Cypriot LNG terminals could together undercut both American and Australian LNG export prices, which could drive down natural gas costs for Europe. This could reduce the profitability of major LNG players like Qatar, where ExxonMobil has a 25%-30% working interest in two of that nation's largest LNG terminals.
An even more significant impact would revolve around the idea of supplying natural gas to Europe via pipeline. It may limit the market for Noble's natural gas, but it would probably generate higher profits per thousand cubic feet of gas because of the cost savings from skirting the liquefaction process. Also, since 40% of Europe's natural gas comes from Statoil (NYSE: STO ) and Gazprom through very lucrative long-term pipeline contracts, Noble could carve out a nice position by displacing either the more expensive pipeline gas from one of these two players or expensive LNG imports.
Not being an expert in geopolitics, I'm not going to try to venture a guess as to how the political landscape will change in the Middle East. It is pretty fascinating, though, that Israel will go from an extremely energy-import dependent nation to a big-time exporter almost overnight. The country has plans to build pipelines to Jordan, the West Bank, and Turkey, which could improve both economic and political ties to these energy-starved regions. Then again, it could also go in the exact opposite direction and could be a prime target for groups or nations who may scuffle with Israel.
What a Fool believes
Noble Energy may have found a very large oil and gas field that could boost its bottom line for decades, but it found that asset in a place that has been the epicenter for religious and ethnic conflict for millennia. Even more, it may find that other companies are reluctant to join the project. Oil services giants Schlumberger (NYSE: SLB ) and Halliburton (NYSE: HAL ) have major contracts across the Middle East, and they are not likely willing to potentially lose those contracts in order to work with Noble in Israel.
Noble Energy investors and geopolitical watchers should be captivated by this story, because the next couple of years could be a wild ride. ****
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Data Watch
________________________________________
The Trade Deficit in Goods and Services Came in at $40.6 Billion in October To view this article, Click Here
Brian S. Wesbury - Chief Economist
Bob Stein, CFA - Deputy Chief Economist
Date: 12/4/2013
The trade deficit in goods and services came in at $40.6 billion in October, slightly larger than the consensus expected $40.0 billion.
Exports increased $3.4 billion in October, led by gains in petroleum products, artwork, diamonds, and nonmonetary gold. Imports increased $1.0 billion, with a drop in autos offset by gains in pharmaceuticals, nonmonetary gold and petroleum products.
In the last year, exports are up 5.5%, led by a 19.4% gain in petroleum exports. Imports are up 3.6% in the past year, held down by a 7.3% decline in petroleum imports.
The monthly trade deficit is $2.1 billion smaller than a year ago. Adjusted for inflation, the trade deficit in goods is $0.2 billion smaller than a year ago. This is the trade indicator most important for measuring real GDP.
Implications: The trade deficit got smaller in October, but was revised higher in September. As a result of the September revisions, it now looks like real GDP grew at a 3% annual rate in Q3. However, the improvement in October suggests net exports should add to real GDP in Q4. Over the past year total exports are up 5.5% while total imports are up a smaller 3.6%. The trend shrinkage in the trade deficit is largely due to US energy production, driven by horizontal drilling and fracking. Petroleum product exports are almost eight times higher than they were in October 2005. During these same eight years, petroleum product imports are only up 26%. If these trends continue and the US fixes its pipeline and refinery issues, the US will be a net petroleum product exporter by 2018. Usually, when the US economy is growing, the trade deficit tends to expand relative to the size of our economy. However, given recent energy trends and plow horse economic growth, the trade deficit has been in a gradual shrinking trend for the past two years. In other recent news, automakers reported car and light truck sales at a 16.4 million annual rate in November, up 7.7% from October, up 7.1% from a year ago, and the fastest pace since early 2007. It’s early, but it appears real (inflation-adjusted) consumer spending is growing at a 2.5 – 3.0% annual rate in the fourth quarter, which would be the fastest pace since early 2012. On the jobs front, the ADP Employment index, a measure of private sector payrolls, increased 215,000 in November. As a result, we are now forecasting that the official Labor Department report will show payroll gains of 194,000 nonfarm and 191,000 private.
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New Energy Struggles on Its Way to Markets
By MATTHEW L. WALD
Published: December 27, 2013
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WASHINGTON — To stave off climate change, sources of electricity that do not emit carbon will have to replace the ones that do. But at the moment, two of those largest sources, nuclear and wind power, are trying to kill each other off.
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In the electricity market, both are squeezed by pressure from natural gas, which provides some carbon reductions compared with coal but will not bring the country anywhere near its goal for reducing greenhouse gas emissions. Natural gas has a carbon footprint that is at least three times as large as that goal.
Energy companies announced this year that five nuclear reactors would be closing or not reopening, and the owners blamed competition from natural gas and wind. In the Pacific Northwest, wind and hydroelectricity — neither of which produce carbon — are sparring to push each other off the regional power grid.
Output from the two has sometimes forced the Columbia Generating Station in Washington State, the region’s only surviving nuclear reactor, to cut back its production. One recent study found that shutting down the reactor would save consumers $1.7 billion, partly because it cannot run full time, and partly because its costs are higher than some other technologies.
If electricity prices were slightly higher, renewable sources of energy would flourish and even some reactors would be built, experts say, lowering carbon emissions. But electricity prices are being forced down by federal subsidies for wind energy production and by cheap natural gas.
“Gas is raining on everyone’s parade; gas is ruining it for everybody in most electricity markets,” said one expert, Michael Webber of the University of Texas at Austin. In 2012, production of electricity from natural gas rose 10 times as fast as production from wind.
Wind energy is being added to the grid mostly because of state requirements, called renewable portfolio standards, but production would grow faster than the standards required if electricity prices from other sources were slightly higher, experts say. At the Electric Power Research Institute, a nonprofit utility consortium, Anda Ray, the group’s vice president for environment, said the electric system would incorporate more zero-carbon sources if natural gas rose to the level of few years ago.
Adding to the clean energy industry’s cannibal behavior, wind farms are being built in places where there is lots of wind but not much demand for power, some experts argue.
Experts say a more intelligent use would involve dispersing the wind farms. Travis Kavulla, a member of the Montana Public Service Commission, said putting the wind machines in one place created an “all-on, all-off” problem. If the wind machines were spread more widely, he said, there was a far better chance that at any moment some would be running and some would not be, with less chance of a local useless surplus.
Montana has a cluster of wind machines near the town of Judith Gap, and Mr. Kavulla’s commission has set up connection fees that charge extra for building in Judith Gap and reward developers for building elsewhere.
The nuclear industry makes the same complaint, but louder. David C. Brown, a Washington representative for Exelon, the Chicago company that operates the nation’s largest network of nuclear reactors, said that the main subsidy for wind, the production tax credit, which pays operators about 2.3 cents per kilowatt-hour for the first 10 years of production, “has been very effective at getting generation built.”
“It’s getting built without regard to whether it’s actually needed for power supply purposes, and it distorts the market,” he said. Existing nuclear plants do not get a subsidy per kilowatt-hour produced.
Wholesale energy prices fluctuate throughout the day. Exelon, he said, is “seeing this tipping point developing” when several of its zero-carbon reactors may have to be retired because wind power is suppressing those prices around the clock, and at some hours producers must pay the grid operator if they put energy on the grid. Wind operators still make money, though, through the production tax credit.
It is not clear how this struggle will play out over the next few years. At the moment, according to Mr. Webber, natural gas is so cheap that it is stunting construction of even new plants that would burn natural gas.
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http://www.foreignpolicy.com/articles/2014/01/02/how_a_mega_project_snafu_could_accidentally_snarl_america_s_gas_exports?utm_source=Sailthru&utm_medium=email&utm_term=Flashpoints%20Complete%2010%2F7&utm_campaign=Flashpoints%2001-02-14#sthash.y3Hl94kJ.dpbs
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Stymied by special interests, our President thinks we are better off moving our energy by the least safe means. So what does that mean when the expected disaster happens in your town? 300 ft fireballs exploding in the Casselton, ND derailment, take a look at the news video - or this picture:
http://abcnews.go.com/US/casselton-residents-urged-evacuate-oil-train-collision/story?id=21376966
(http://www.perhamfocus.com/sites/default/files/styles/full_1000/public/field/image/derailblow.jpg?itok=kKzh2UWW)
By not drilling, not refining, not transporting oil we will get off oil. Meanwhile, how did the Pres. get to and from Hawaii, does anyone know? What powered the 'Global Warming - Missing Antarctic Ice" expedition? What powered the rescue? It is 2014 and...WE USE OIL. How about making it available, affordable, safe and clean until we move on shortly to other power sources? We know the stats, why not make things as safe as economically possible. Trucks and trains are less safe than pipelines.
http://www.manhattan-institute.org/html/ib_23.htm
Pipelines Are Safest For Transportation of Oil and Gas
http://www.fraserinstitute.org/uploadedFiles/fraser-ca/Content/research-news/research/publications/intermodal-safety-in-the-transport-of-oil.pdf
When it comes to transporting oil, pipelines are the safest option, trumping trains and trucks
http://www.transcanada.com/pipeline-safety.html
Pipelines are the safest method for the transportation of petroleum products when compared to other methods of transportation. Steel pipelines provide the safest, most efficient and most economical way to transport crude oil.
http://www.pipeline101.com/overview/safe.html
Pipeline systems are recognized as both the safest transportation mode and the most economical way of distributing the vast quantities of oil from production fields to refineries and from refineries to consumers.
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But then BO's supporter Warren Buffet, who IIRC has invested heavily in rail, won't get richer-- indeed, if I am not mistaken, he has a position in the player(s) in this accident.
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Implications: Fracking and horizontal drilling continue to transform not only the US energy industry but also our trade with the rest of the world. The US trade deficit fell to $34.3 billion in November, coming in much smaller than the consensus expected. With the exception of 2009, when a weak economy temporarily shrank trade around the world, this is the smallest trade deficit since 2002. Plugging these figures into our GDP calculations, it looks like real final sales (real GDP excluding inventories) will be up at a robust 3.9% annual rate in Q4, even if an inventory drag keeps real GDP growth down around 2.5%. Eight years ago, back in November 2005, the US imported 14 times as much petroleum product as it exported. Since then, petroleum product exports are up almost eight times higher while imports are up only 15%. So now, petroleum product imports are only twice exports. If this trend continues, the US will be a net petroleum product exporter by late 2016, sooner if we fix our pipeline and refinery issues. Outside of energy, the trade deficit has generally grown over the past four years of recovery, but has recently leveled off. Non-petroleum exports are at a new record high. Normally, when the US economy grows consistently, our trade deficit tends to expand. However, as a large producer of natural gas, the US has an energy cost advantage versus many of the advanced nations around the world. In the years ahead, this advantage plus the direct effect of more energy exports and fewer imports should help suppress any expansion in the trade deficit relative to the size of the economy.
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http://asheepnomore.net/2013/11/21/this-massive-discovery-has-put-the-saudis-into-a-panic/
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I saw this some months ago. There is no infrastructure there. It will take years to develop from what I read.
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While we were all fighting against fossil fuel pipeline, fracking, refusing to build refineries, making faux-investments in solar and wind and closing down nuclear plants in the name of safety around the world, guess what happened...
Coal was the fastest growing energy source in the world in 2013.
Does someone want to tell me that is cleaner or safer than nuclear, gasoline or natural gas? Good luck.
http://www.reuters.com/article/2014/01/07/china-coal-idUSL3N0K90H720140107
(http://3-ps.googleusercontent.com/h/www.powerlineblog.com/admin/ed-assets/2014/01/389x461xChina-Coal-copy.jpg.pagespeed.ic.Hwgo8cYUUe.jpg)
http://online.wsj.com/news/articles/SB10001424052702303332904579228160256043626
Germany closes nuclear, opens coal:
(http://3-ps.googleusercontent.com/h/www.powerlineblog.com/admin/ed-assets/2014/01/465x586xGerman-Coal-copy.jpg.pagespeed.ic.rjIvczQPGF.jpg)
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The war on our friends continues. Not unlike the war on America:
*****By Charles Krauthammer, Published: January 23 E-mail the writer
Fixated as we Americans are on Canada’s three most attention-getting exports — polar vortexes, Alberta clippers and the antics of Toronto’s addled mayor — we’ve somewhat overlooked a major feature of Canada’s current relations with the United States: extreme annoyance.
Last week, speaking to the U.S. Chamber of Commerce, Canada’s foreign minister calmly but pointedly complained that the United States owes Canada a response on the Keystone XL pipeline. “We can’t continue in this state of limbo,” he sort of complained, in what for a placid, imperturbable Canadian passes for an explosion of volcanic rage.
Canadians may be preternaturally measured and polite, but they simply can’t believe how they’ve been treated by President Obama — left hanging humiliatingly on an issue whose merits were settled years ago.
Canada, the Saudi Arabia of oil sands, is committed to developing this priceless resource. Its natural export partner is the United States. But crossing the border requires State Department approval, which means the president decides yes or no.
After three years of review, the State Department found no significant environmental risk to Keystone. Nonetheless, the original route was changed to assuage concerns regarding the Ogallala Aquifer. Obama withheld approval through the 2012 election. To this day he has issued no decision.
The Canadians are beside themselves. After five years of manufactured delay, they need a decision one way or the other because if denied a pipeline south, they could build a pipeline west to the Pacific. China would buy their oil in a New York minute.
Yet Secretary of State John Kerry fumblingly says he is awaiting yet another environmental report. He offered no decision date.
If Obama wants to cave to his environmental left, fine. But why keep Canada in limbo? It’s a show of supreme and undeserved disrespect for yet another ally. It seems not enough to have given the back of the hand to Britain, Israel, Poland and the Czech Republic, and to have so enraged the Saudis that they actually rejected a U.N. Security Council seat — disgusted as they were with this administration’s remarkable combination of fecklessness and highhandedness. Must we crown this run of diplomatic malpractice with gratuitous injury to Canada, our most reliable, most congenial friend in the world?
And for what? This is not a close call. The Keystone case is almost absurdly open and shut.
Even if you swallow everything the environmentalists tell you about oil sands, the idea that blocking Keystone would prevent their development by Canada is ridiculous. Canada sees its oil sands as a natural bounty and key strategic asset. Canada will not leave it in the ground.
Where’s the environmental gain in blocking Keystone? The oil will be produced and the oil will be burned. If it goes to China, the Pacific pipeline will carry the same environmental risks as a U.S. pipeline.
And Alberta oil can still go to the United States, if not by pipeline then by rail, which requires no State Department approval. That would result in far more greenhouse gas emissions — exactly the opposite of what the environmentalists are seeking.
Moreover, rail can be exceedingly dangerous. Last year a tanker train derailed and exploded en route through Quebec. The fireball destroyed half of downtown Lac-Megantic, killing 47, many incinerated beyond recognition.
This isn’t theoretical environmentalism. This is not a decrease in the snail darter population. This is 47 dead human beings. More recently, we’ve had two rail-oil accidents within the United States, one near Philadelphia and one in North Dakota.
Add to this the slam-dunk strategic case for Keystone: Canadian oil reduces our dependence on the volatile Middle East, shifting petroleum power from OPEC and the killing zones of the Middle East to North America. What more reliable source of oil could we possibly have than Canada?
Keystone has left Canada very upset, though characteristically relatively quiet. Canadians may have succeeded in sublimating every ounce of normal human hostility and unpleasantness by way of hockey fights, but that doesn’t mean we should take advantage of their good manners.
The only rationale for denying the pipeline is political — to appease Obama’s more extreme environmentalists. For a president who claims not to be ideological, the irony is striking: Here is an easily available piece of infrastructure — privately built, costing government not a penny, creating thousands of jobs and, yes, shovel-ready — and yet the president, who’s been incessantly pushing new “infrastructure” as a fundamental economic necessity, can’t say yes.
Well then, Mr. President, say something. You owe Canada at least that. Up or down. Five years is long enough.
Read more from Charles Krauthammer’s archive, follow him on Twitter or subscribe to his updates on Facebook. ******
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http://www.reuters.com/article/2014/01/08/us-norway-millionaires-idUSBREA0710U20140108
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http://www.leaderpost.com/touch/story.html?id=9443268
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Arthur Berman continues to maintain:
Wells do not have long drilling life and drilling companies have to keep searching and drilling more just to maintain. Capital expenditures are so enormous for these hard to get liquids that companies are spending more than they make to get the stuff. Prices have to be high to make it profitable and most supplies estimates are exaggerations and not realistic. Similar issues with oil in sands:
*****Shale, the Last Oil and Gas Train: Interview With Arthur Berman
By Oilprice.com
March 6, 2014
This article was written by Oilprice.com -- the leading provider of energy news in the world. Also see our previous interview with Arthur Berman.
How much faith can we put in our ability to decipher all the numbers out there telling us the US is closing in on its cornering of the global oil market? There's another side to the story of the relentless US shale boom, one that says that some of the numbers are misunderstood, while others are simply preposterous. The truth of the matter is that the industry has to make such a big deal out of shale because it's all that's left. There are some good things happening behind the fairy tale numbers, though—it's just a matter of deciphering them from a sober perspective.
In a second exclusive interview with James Stafford of Oilprice.com, energy expert Arthur Berman discusses:
• Why US gas supply growth rests solely on Marcellus
• When Bakken and Eagle Ford will peak
• The eyebrow-raising predictions for the Permian Basin
• Why outrageous claims should have oil lawyers running for cover
• Why everyone's making such a big deal about shale
• The only way to make the shale gas boom sustainable
• Why some analysts need their math examined
• Why it's not just about how much gas we produce
• Why investors are starting to ask questions
• Why new industries, not technologies will make the next boom
• Why we'll never hit the oil and gas 'wall'
• Why companies could use a little supply and-demand discipline
• Why 'fire ice' makes sense (in Japan)
• Why the US crude export debate will be 'silly'
Arthur is a geological consultant with thirty-four years of experience in petroleum exploration and production. He is currently consulting for several E&P companies and capital groups in the energy sector. He frequently gives keynote addresses for investment conferences and is interviewed about energy topics on television, radio, and national print and web publications including CNBC, CNN, Platt's Energy Week, BNN, Bloomberg, Platt's, Financial Times, and New York Times. You can find out more about Arthur by visiting his website: http://petroleumtruthreport.blogspot.com
Oilprice.com: Almost on a daily basis we have figures thrown at us to demonstrate how the shale boom is only getting started. Mostly recently, there are statements to the effect that Texas shale formations will produce up to one-third of the global oil supply over the next 10 years. Is there another story behind these figures?
Arthur Berman: First, we have to distinguish between shale gas and liquids plays. On the gas side, all shale gas plays except the Marcellus are in decline or flat. The growth of US supply rests solely on the Marcellus and it is unlikely that its growth can continue at present rates. On the oil side, the Bakken has a considerable commercial area that is perhaps only one-third developed so we see Bakken production continuing for several years before peaking. The Eagle Ford also has significant commercial area but is showing signs that production may be flattening. Nevertheless, we see 5 or so more years of continuing Eagle Ford production activity before peaking. The EIA has is about right for the liquids plays--slower increases until later in the decade, and then decline.
The idea that Texas shales will produce one-third of global oil supply is preposterous. The Eagle Ford and the Bakken comprise 80% of all the US liquids growth. The Permian basin has notable oil reserves left but mostly from very small accumulations and low-rate wells. EOG (NYSE: EOG ) CEO Bill Thomas said the same thing about 10 days ago on EOG's earnings call. There have been some truly outrageous claims made by some executives about the Permian basin in recent months that I suspect have their general counsels looking for a defibrillator.
Recently, the CEO of a major oil company told The Houston Chronicle that the shale revolution is only in the "first inning of a nine-inning game". I guess he must have lost track of the score while waiting in line for hot dogs because production growth in U.S. shale gas plays excluding the Marcellus is approaching zero; growth in the Bakken and Eagle Ford has fallen from 33% in mid-2011 to 7% in late 2013.
Oil companies have to make a big deal about shale plays because that is all that is left in the world. Let's face it: these are truly awful reservoir rocks and that is why we waited until all more attractive opportunities were exhausted before developing them. It is completely unreasonable to expect better performance from bad reservoirs than from better reservoirs.
The majors have shown that they cannot replace reserves. They talk about return on capital employed (ROCE) these days instead of reserve replacement and production growth because there is nothing to talk about there. Shale plays are part of the ROCE story--shale wells can be drilled and brought on production fairly quickly and this masks or smoothes out the non-productive capital languishing in big projects around the world like Kashagan and Gorgon, which are going sideways while eating up billions of dollars.
None of this is meant to be negative. I'm all for shale plays but let's be honest about things, after all! Production from shale is not a revolution; it's a retirement party.
OP: Is the shale "boom" sustainable?
Arthur Berman: The shale gas boom is not sustainable except at higher gas prices in the US. There is lots of gas--just not that much that is commercial at current prices. Analysts that say there are trillions of cubic feet of commercial gas at $4 need their cost assumptions audited. If they are not counting overhead (G&A) and many operating costs, then of course things look good. If Walmart were evaluated solely on the difference between wholesale and retail prices, they would look fantastic. But they need stores, employees, gas and electricity, advertising and distribution. So do gas producers. I don't know where these guys get their reserves either, but that needs to be audited as well.
There was a report recently that said large areas of the Barnett Shale are commercial at $4 gas prices and that the play will continue to produce lots of gas for decades. Some people get so intrigued with how much gas has been produced and could be in the future, that they don't seem to understand that this is a business. A business must be commercial to be successful over the long term, although many public companies in the US seem to challenge that concept.
Investors have tolerated a lot of cheerleading about shale gas over the years, but I don't think this is going to last. Investors are starting to ask questions, such as: Where are the earnings and the free cash flow. Shale companies are spending a lot more than they are earning, and that has not changed. They are claiming all sorts of efficiency gains on the drilling side that has distracted inquiring investors for awhile. I was looking through some investor presentations from 2007 and 2008 and the same companies were making the same efficiency claims then as they are now. The problem is that these impressive gains never show up in the balance sheets, so I guess they must not be very important after all.
The reason that the shale gas boom is not sustainable at current prices is that shale gas is not the whole story. Conventional gas accounts for almost 60% of US gas and it is declining at about 20% per year and no one is drilling more wells in these plays. The unconventional gas plays decline at more than 30% each year. Taken together, the US needs to replace 19 billion cubic feet per day each year to maintain production at flat levels. That's almost four Barnett shale plays at full production each year! So you can see how hard it will be to sustain gas production. Then there are all the efforts to use it up faster--natural gas vehicles, exports to Mexico, LNG exports, closing coal and nuclear plants--so it only gets harder.
This winter, things have begun to unravel. Comparative gas storage inventories are near their 2003 low. Sure, weather is the main factor but that's always the case. The simple truth is that supply has not been able to adequately meet winter demand this year, period. Say what you will about why but it's a fact that is inconsistent with the fairy tales we continue to hear about cheap, abundant gas forever.
I sat across the table from industry experts just a year ago or so who were adamant that natural gas prices would never get above $4 again. Prices have been above $4 for almost three months. Maybe "never" has a different meaning for those people that doesn't include when they are wrong.
OP: Do you foresee any new technology on the shelf in the next 10-20 years that would shape another boom, whether it be fossil fuels or renewables?
Arthur Berman: I get asked about new technology that could make things different all the time. I'm a technology enthusiast but I see the big breakthroughs in new industries, not old extractive businesses like oil and gas. Technology has made many things possible in my lifetime including shale and deep-water production, but it hasn't made these things cheaper.
That's my whole point about shale plays--they're expensive and need high oil and gas prices to work. We've got the high prices for oil and the oil plays are fine; we don't have high prices for the gas plays and they aren't working. There are some areas of the Marcellus that actually work at $4 gas price and that's great, but it really takes $6 gas prices before things open up even there.
OP: In Europe, where do you see the most potential for shale gas exploitation, with Ukraine engulfed in political chaos, companies withdrawing from Poland, and a flurry of shale activity in the UK?
Arthur Berman: Shale plays will eventually spread to Europe but it will take a longer time than it did in North America. The biggest reason is the lack of private mineral ownership in most of Europe so there is no incentive for local people to get on board. In fact, there are only the negative factors of industrial development for them to look forward to with no pay check. It's also a lot more expensive to drill and produce gas in Europe.
There are a few promising shale plays on the international horizon: the Bazherov in Russia, the Vaca Muerte in Argentina and the Duvernay in Canada look best to me because they are liquid-prone and in countries where acceptable fiscal terms and necessary infrastructure are feasible. At the same time, we have learned that not all plays work even though they look good on paper, and that the potentially commercial areas are always quite small compared to the total resource. Also, we know that these plays do not last forever and that once the drilling treadmill starts, it never ends. Because of high decline rates, new wells must constantly be drilled to maintain production. Shale plays will last years, not decades.
Recent developments in Poland demonstrate some of the problems with international shale plays. Everyone got excited a few years ago because resource estimates were enormous. Later, these estimates were cut but many companies moved forward and wells have been drilled. Most international companies have abandoned the project including ExxonMobil, ENI, Marathon and Talisman. Some players exited because they don't think that the geology is right but the government has created many regulatory obstacles that have caused a lack of confidence in the fiscal environment in Poland.
The UK could really use the gas from the Bowland Shale and, while it's not a huge play, there is enough there to make a difference. I expect there will be plenty of opposition because people in the UK are very sensitive about the environment and there is just no way to hide the fact that shale development has a big footprint despite pad drilling and industry efforts to make it less invasive.
Let me say a few things about resource estimates while we are on the subject. The public and politicians do not understand the difference between resources and reserves. The only think that they have in common is that they both begin with "res." Reserves are a tiny subset of resources that can be produced commercially. Both are always wrong but resource estimates can be hugely misleading because they are guesses and have nothing to do with economics.
Someone recently sent me a new report by the CSIS that said U.S. shale gas resource estimates are too conservative and are much larger than previously believed. I wrote him back that I think that resource estimates for U.S. shale gas plays are irrelevant because now we have robust production data to work with. Most of those enormous resources are in plays that we already know are not going to be economic. Resource estimates have become part of the shale gas cheerleading squad's standard tricks to drum up enthusiasm for plays that clearly don't work except at higher gas prices. It's really unfortunate when supposedly objective policy organizations and research groups get in on the hype in order to attract funding for their work.
OP: The ban on most US crude exports in place since the Arab oil embargo of 1973 is now being challenged by lobbyists, with media opining that this could be the biggest energy debate of the year in the US. How do you foresee this debate shaping up by the end of this year?
Arthur Berman: The debate over oil and gas exports will be silly.
I do not favor regulation of either oil or gas exports from the US. On the other hand, I think that a little discipline by the E&P companies might be in order so they don't have to beg the American people to bail them out of the over-production mess that they have created knowingly for themselves. Any business that over-produces whatever it makes has to live with lower prices. Why should oil and gas producers get a pass from the free-market laws of supply and demand?
I expect that by the time all the construction is completed to allow gas export, the domestic price will be high enough not to bother. It amazes me that the geniuses behind gas export assume that the business conditions that resulted in a price benefit overseas will remain static until they finish building export facilities, and that the competition will simply stand by when the awesome Americans bring gas to their markets. Just last week, Ken Medlock described how some schemes to send gas to Asia may find that there will be a lot of price competition in the future because a lot of gas has been discovered elsewhere in the world.
The US acts like we are some kind of natural gas superstar because of shale gas. Has anyone looked at how the US stacks up next to Russia, Iran and Qatar for natural gas reserves?
Whatever outcome results from the debate over petroleum exports, it will result in higher prices for American consumers. There are experts who argue that it won't increase prices much and that the economic benefits will outweigh higher costs. That may be but I doubt that anyone knows for sure. Everyone agrees that oil and gas will cost more if we allow exports.
OP: Is the US indeed close to hitting the "crude wall"—the point at which production could slow due to infrastructure and regulatory restraints?
Arthur Berman: No matter how much or little regulation there is, people will always argue that it is still either too much or too little. We have one of the most unfriendly administrations toward oil and gas ever and yet production has boomed. I already said that I oppose most regulation so you know where I stand. That said, once a bureaucracy is started, it seldom gets smaller or weaker. I don't see any walls out there, just uncomfortable price increases because of unnecessary regulations.
We use and need too much oil and gas to hit a wall. I see most of the focus on health care regulation for now. If there is no success at modifying the most objectionable parts of the Affordable Care Act, I don't suppose there is much hope for fewer oil and gas regulations. The petroleum business isn't exactly the darling of the people.
OP: What is the realistic future of methane hydrates, or "fire ice", particularly with regard to Japanese efforts at extraction?
Arthur Berman: Japan is desperate for energy especially since they cut back their nuclear program so maybe hydrates make some sense at least as a science project for them. Their pilot is in thousands of feet of water about 30 miles offshore so it's going to be very expensive no matter how successful it is.
OP: Globally, where should we look for the next potential "shale boom" from a geological perspective as well as a commercial viability perspective?
Arthur Berman: Not all shale is equal or appropriate for oil and gas development. Once we remove all the shale that is not at or somewhat above peak oil generation today, most of it goes away. Some shale plays that meet these and other criteria didn't work so we have a lot to learn. But shale development is both inevitable and necessary. It will take a longer time than many believe outside of North America.
OP: We've spoken about Japan's nuclear energy crossroads before, and now we see that issue climaxing, with the country's nuclear future taking center-stage in an election period. Do you still believe it is too early for Japan to pull the plug on nuclear energy entirely?
Arthur Berman: Japan and Germany have made certain decisions about nuclear energy that I find remarkable but I don't live there and, obviously, don't think like them.
More generally, environmental enthusiasts simply don't see the obstacles to short-term conversion of a fossil fuel economy to one based on renewable energy. I don't see that there is a rational basis for dialogue in this arena. I'm all in favor of renewable energy but I don't see going from a few percent of our primary energy consumption to even 20% in less than a few decades no matter how much we may want to.
OP: What have we learned over the past year about Japan's alternatives to nuclear energy?
Arthur Berman: We have learned that it takes a lot of coal to replace nuclear energy when countries like Japan and Germany made bold decisions to close nuclear capacity. We also learned that energy got very expensive in a hurry. I say that we learned. I mean that the past year confirmed what many of us anticipated.
OP: Back in the US, we have closely followed the blowback from the Environmental Protection Agency's (EPA) proposed new carbon emissions standards for power plants, which would make it impossible for new coal-fired plants to be built without the implementation of carbon capture and sequestration technology, or "clean-coal" tech. Is this a feasible strategy in your opinion?
Arthur Berman: I'm not an expert on clean coal technology either but I am confident that almost anything is possible if cost doesn't matter. This is as true about carbon capture from coal as it is about shale gas production. Energy is an incredibly complex topic and decisions are being made by bureaucrats and politicians with little background in energy or the energy business. I don't see any possibility of a good outcome under these circumstances.
OP: Is CCS far enough along to serve as a sound basis for a national climate change policy?
Arthur Berman: Climate-change activism is a train that has left the station. If you've missed it, too bad. If you're on board, good luck.
The good news is that the US does not have an energy policy and is equally unlikely to get a climate change policy for all of the same reasons. I fear putting climate change policy in the hands of bureaucrats and politicians more than I fear climate change (which I fear).*****
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Environmentalists Threaten Energy Development
Energy and the sage grouse
Unhappy with their inability to halt the nation's growing oil and gas industry, envirofascists are pushing the Department of the Interior to add a record 757 new species to the Endangered Species Act in an attempt to close off 50 to 100 million acres to any kind of economic development. One bird for which they seek "protection" is the sage grouse, which is found in 11 western states, raising the question that if it lives in such a wide swath of territory, just how endangered can it be?
That is a question Interior refuses to answer. Like many of its studies over the years that have led to numerous additions to the ESA list, the department won't divulge the method by which it arrives at its decisions to define animals as endangered. A recent report put together by 13 House members and led by Natural Resources Committee Chairman Doc Hastings details numerous discrepancies in ESA research, including the use of selective data, biased sampling, inaccurate mapping and subjective interpretation of results.
The shoddy research stands unchallenged because environmental groups use a "sue and settle" strategy that basically floods the government with lawsuits that are more easily settled out of court than challenged on the merits. Two groups, Wildlife Guardians and the Center for Biological Diversity, have been involved in more than 1,000 such lawsuits since 1990. Their aim is nothing short of ending fossil-fuel production in the United States. Their tactics have become so brazen that even Democrats like Senator Harry Reid and Colorado Governor John Hickenlooper have complained that adding the sage grouse to the ESA list will have a massively negative economic impact on their respective states. Whether they will do anything about it is another story.
According to the Department of the Interior, the sage grouse and the prairie chicken, another potential addition to the list of endangered species, have habitats near the Bakken Shale fields of North Dakota and the Permian Basin in Texas, respectively. If the department's actions go unchallenged, these huge sources of fossil fuels could be essentially cut off from development. If the "science" of the environmentalists is as solid as they claim, then they should be called upon to defend their findings in an open forum. Let the facts speak for themselves, if they can.
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The building of the pipeline will result in mostly temporary job creation, but it is the flow of energy in the pipeline that will support long term economic growth and real job creation.
http://www.iea.org/textbase/npsum/high_oil04sum.pdf
http://allafrica.com/view/resource/main/main/id/00010270.html
In 2004, the International Energy Agency prepared an analysis with the collaboration of the OECD Economics Department and with the assistance of the International Monetary Fund Research Department:
“. . . a sustained $10 per barrel increase in oil prices from $25 to $35 would result in the OECD as a whole losing 0.4% of GDP in the first and second year of higher prices. Inflation would rise by half a percentage point and unemployment would also increase.”
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So moved, and then some.
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http://www.nytimes.com/2014/03/29/us/politics/white-house-unveils-plans-to-to-cut-methane-emissions.html?emc=edit_th_20140329&nl=todaysheadlines&nlid=49641193
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http://www.nytimes.com/2014/03/29/us/politics/white-house-unveils-plans-to-to-cut-methane-emissions.html?emc=edit_th_20140329&nl=todaysheadlines&nlid=49641193
Despite what they claim, it's just their war against red state kulaks. Can't have free men making money doing manly things.
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adioactive Waste Is North Dakota's New Shale Problem
Local Officials Find Improper Dumping of Used 'Oil Socks'
By Chester Dawson
connect
April 15, 2014 1:29 p.m. ET
Bags full of radioactive oil filters piled in an abandoned building in Noonan, N.D. North Dakota Health Department/Associated Press
At a deserted gas station in a remote North Dakotan town, local officials recently found the latest example of the shale-oil boom's unintended consequences: hundreds of garbage bags filled with mildly radioactive waste.
These bags, which were discovered late February in Noonan, N.D., contained what are known as "oil socks": three-foot-long, snake-like filters made of absorbent fiber that the shale-oil industry uses to capture silt from waste water resulting from hydraulic fracturing.
Days earlier, a similar trove had been found on flatbed trailers near a landfill in Watford City—which, like Noonan, is located in the state's sparsely populated westernmost reaches where the Bakken oil shale formation lies.
The two recent incidents show that North Dakota's regulators have been slow to address repercussions from the surge in crude output, ranging from widespread flaring of natural gas at oil wells to drill rigs popping up on historic lands.
Most of the radioactive material in oil socks comes from silt filtered in the process of pumping waste water down injection wells. Radium, found in soil, rock and water, accumulates in the filtered silt.
"Before the Bakken oil boom we didn't have any of these materials being generated," said State Waste Management Director Scott Radig. "So it wasn't really an issue."
The trailers found in Watford City that contained improperly stored oil socks belonged to Riverton, Wyo.-based RP Services LLC, state officials said. The investigation is still underway, and RP Services didn't respond to requests for comment. One of its clients, oil giant Continental Resources Inc., CLR +0.86% has cut ties with the company as a result of the discovery.
Radiation levels from these oil socks are fairly low—North Dakota state officials say a person could stand for a year by a Dumpster full of them and receive less skin radiation than from a dental X-ray. But the discovery of the large quantities of improperly stored and abandoned radioactive waste has triggered a public outcry.
Last week, the state reacted by passing new regulations—effective June 1—forcing the shale-oil industry to use leak-proof containers to temporarily store the socks at well sites. "This is a response to the ongoing problem of illegal dumping of filter socks," said Lynn Helms, director of the state department of mineral resources.
North Dakota already mandates the filters eventually be transported by "licensed waste haulers" to an authorized disposal facility.
The problem: North Dakota doesn't have a single storage facility capable of handling radioactive waste—and it now has between 500 and 600 injection wells producing the socks.
The U.S. Environmental Protection Agency says the average level of radium in soil is below five picocuries per gram, which is the maximum threshold for waste disposal at standard dumps in North Dakota and many other states. The average concentration of radium in wastewater sludge from oil-and-gas production is about 75 picocuries per gram, according to the EPA. Radioactive sludge poses a higher risk of exposure than some other forms of radiation-prone substances because their solubility in water allows them to be more readily released to the environment.
Several states outside of North Dakota—Idaho, Colorado, Utah, and to some extent, Montana—have designated dumps to handle above-average levels of radioactive waste. Facilities in Montana accept materials with radiation levels of under 30 picocuries per gram, while in Idaho, they tolerate levels as high as 1,500.
As a result, radioactive oil socks from North Dakota's shale-oil industry often have to be transported hundreds of miles away to dumps certified to handle it.
"There's such a rush to get the oil out that the rules and regulations are not keeping up with the pace of development," said Wayde Schafer, head of the North Dakota chapter of the Sierra Club. "This state is reactive instead of proactive," he said.
Illegal disposal or storage of radioactive waste in North Dakota is subject to fines of up to $10,000 per incident in addition to a $1,000 fine for standard illegal dumping, state officials say. But that hasn't stopped the occasional dumping of contaminated socks on road sides or at waste facilities.
Dump operators now routinely screen garbage with radiation monitors, and have the power to levy fines on offenders.
"It's unfortunate it falls to guys like me to enforce the rules," said Rick Schreiber, solid waste director at the McKenzie County Landfill near Watford City, which levies a fine of $1,000 per sock. "The state isn't doing much about it."
Policing is part of dump operators' job, state officials say. "They are responsible for checking waste loads coming in," said David Glatt, chief of the North Dakota Health Department's Environmental Health Section. "They can either reject it, or they can fine them."
North Dakota's volume of filter waste with levels of radiation requiring specialized disposal ranges from a low of eight tons a day to several times that number, according to state and industry officials.
Where all that oilfield-related waste winds up is anyone's guess, say companies specializing in radioactive waste disposal. But they believe most of the filters are being properly handled to avoid heavy fines.
"When you're looking at fines of $1,000 per sock, it really doesn't make financial sense to sneak them in" to state dumps, said Kurt Rhea, manager of a Denver-based waste disposal unit of Secure Energy Services Inc. SES.T -0.05% "I've had a couple of people call up and say: ‘I can't tell you my company name, but what would it cost?'" to have the filters disposed of out of state, Mr. Rhea said.
The North Dakota Petroleum Council, an industry lobby, believes the state's radiation exposure limits for industrial waste are too low and supports allowing disposal within North Dakota at certified dumps. That is something state health authorities are studying, in cooperation with Argonne National Laboratory.
"We need a North Dakota-based solution," said council president Ron Ness.
Write to Chester Dawson at chester.dawson@wsj.com
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http://care1st.com/
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I do not know about this source; I simply post it as a contribution to the conversation:
http://capoliticalnews.com/2014/04/20/another-study-proves-fracking-doesnt-hurt-ground-water/
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I do not know about this source; I simply post it as a contribution to the conversation:
http://capoliticalnews.com/2014/04/20/another-study-proves-fracking-doesnt-hurt-ground-water/
Also documented here: http://dogbrothers.com/phpBB2/index.php?topic=1096.msg73659#msg73659
http://dogbrothers.com/phpBB2/index.php?topic=1096.msg46669#msg46669
http://www.hydraulicfracturing.com/Documents/Hydraulic_Fracturing_SGEIS_comments.pdf
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61% Favor Building the Keystone XL Pipeline
http://www.rasmussenreports.com/public_content/politics/general_politics/april_2014/new_high_61_favor_building_the_keystone_xl_pipeline
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My view of off-year politics is that iti it our job to get the positions on the issues right and then win over the hearts and minds. Keystone is falling the way of Obamacare, for the Republicans and against the Democrats. Another indicator of which way things are turning. We need a few more victories.
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Even though we may loathe Bloomberg for other reasons, this article seems well reasoned and persuasively written to me.
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The Right Way to Develop Shale Gas
By MICHAEL R. BLOOMBERG and FRED KRUPPAPRIL 29, 2014
LISTENING to the polarized energy debate in the United States, you might think natural gas was an economic and geopolitical cure-all — or an environmental curse. Too many oil and gas executives behave as if this newly abundant resource, released from underground shale deposits by the combination of horizontal drilling and hydraulic fracturing, has no environmental challenges. Opponents often act as if it has no economic and environmental benefits.
So here’s a reality check. The shale gas boom is indeed lowering energy costs, creating new jobs, boosting domestic manufacturing and delivering some measurable environmental benefits as well. Unlike coal, natural gas produces minuscule amounts of such toxic air pollutants as sulfur dioxide and mercury when burned — so the transition from coal- to natural-gas-fired electricity generation is improving overall air quality, which improves public health. There’s also a potential climate benefit, since natural-gas-fired plants emit roughly half the carbon dioxide of coal-fired ones.
At the same time, opposition to shale gas development is driven by very real instances of localized air and groundwater pollution. Because of intensive shale-gas development, the small town of Pinedale, Wyo., has experienced smog concentrations comparable to those of Los Angeles. The industry asserts that hydraulic fracturing does not contaminate water supplies when fluids are shot at high pressure into shale deposits to release gas. But inspection records in several states show that mistakes or accidents in other phases of the process — poor well construction or surface spills, for example — have done so.
These environmental concerns are having a major impact on public opinion. A poll by the Pew Research Center last fall found that 49 percent of those surveyed opposed the increased use of hydraulic fracturing, while 44 percent supported it. These views are leading communities and even states to keep out the industry. In 2010, New York, one of four states sitting atop an estimated 141 trillion cubic feet of recoverable natural gas in the Marcellus Shale formation, became the first state to impose a moratorium on hydraulic fracturing. Last year in Colorado, four cities voted to prohibit it. If opponents have their way, a statewide measure restricting the process will be on the Colorado ballot this fall.
There’s also a growing awareness today of another serious problem with natural gas development: methane emissions, which can undo the potential climate benefit of natural gas. Though it burns cleaner than coal, uncombusted natural gas is mostly methane, a greenhouse gas 84 times more potent than carbon dioxide in the first 20 years after it is released. Estimates vary widely about how much methane is being leaked or vented during the production and transportation of natural gas, but there is no doubt that methane emissions need to be measured and reduced.
This is essentially a data acquisition and management problem — the kind that we know we can solve. For instance, after New York City’s health department installed 150 air-quality monitors throughout the city in 2008, a startling fact emerged: Dirty heating oil caused more soot pollution than all the cars and trucks in the city combined. The resulting Clean Heat program helped drive down sulfur dioxide pollution by nearly 70 percent and soot levels by almost 25 percent by helping the worst polluting buildings switch to cleaner fuels.
The same data-driven approach can reduce air and water pollution from shale gas drilling, by requiring operators and regulators to identify and correct hot spots. We have the technology to do this. But we can’t manage what we don’t measure.
Strong rules and enforcement are critical. And, as one of us, Fred Krupp, describes in the current issue of Foreign Affairs, states are beginning to take action. Texas has imposed tough standards for well integrity, a key to groundwater protection. Wyoming has set strong requirements for water testing before drilling begins. Ohio is emerging as a leader in reducing air pollution from leaky oil and gas equipment. And in February, Colorado became the first state to directly regulate methane emissions from oil and gas operations — a huge step forward.
After Gov. John Hickenlooper declared “zero tolerance” for methane, three of Colorado’s largest oil and gas producers worked with the Environmental Defense Fund to develop a proposal that shaped the state’s final rules. The new rules will also remove 90,000 tons of smog-forming volatile organic compounds — about what the state’s cars and trucks discharge each year — and 100,000 tons of methane from the industry’s emissions.
Reducing air pollution makes good business sense. Why waste natural gas, when capturing emissions and reducing leaks is so cost effective? E.D.F. recently commissioned a study that evaluated currently available measures to reduce methane emissions. The measures could cut emissions by 40 percent over five years — at a cost of less than a penny per thousand cubic feet of gas produced, which today costs between $4 and $5.
Now the Obama administration is developing a methane-reduction strategy. We’re confident the Environmental Protection Agency will recognize, as Colorado did, that sensible rules are necessary and affordable, and will work with states to write them. And we hope that as in Colorado, industry leaders, elected officials and environmentalists will work together to make shale gas development safer. Doing so will not only help the industry meet reasonable pollution limits, it will help the industry regain public trust.
Michael R. Bloomberg, mayor of New York from 2002 to 2013, is the founder of Bloomberg L.P. and Bloomberg Philanthropies. Fred Krupp is president of the Environmental Defense Fund.
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Bloomberg makes very reasonable points in this piece.
Unfortunately we may have to add him to our 2016 list. Conservatives should be out front on this, but because there is a war on fracking, they have reacted by defending production rather than writing and implementing the right public policies - that would enable relatively clean energy production to continue and expand.
"We have the technology to do this."
"sensible rules are necessary and affordable"
"measures could cut emissions by 40 percent over five years — at a cost of less than a penny per thousand cubic feet of gas produced"
Thoughts and calculations never contemplated by our current EPA.
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There are several excellent points in this piece and its presentation of the issue overall is superb-- very persuasive across the political spectrum.
I'm thinking to take notes and add these points to my repertoire.
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My 2 cents first:
I recall in the late 1990s how one expert said we were at peak oil and the world supply will forever begin to decline.
Fast forward - yes the biggest obstacle now are the environmentalists and the liberals. I do agree we can't allow the frackers to simply scorch the Earth and leave vast wastelands for our descendants but we needn't go the other extreme either. Need to rid the World of Obama first. Probably even the Clintons would sign on to the Keystone pipeline. Even they were not that destructive of the USA as the present guy. (They are as destructive in other ways - ethics, honesty, etc.)
************Jeff McMahon Contributor
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I cover green technology, energy and the environment from Chicago. full bio →
Tech 5/04/2014 @ 8:58AM 682 views
Fracking Insiders See No End To Boom
Despite official predictions that the U.S. energy boom will pop like a bubble in the next 20 years, people engaged in drilling for oil and gas—from the financiers to the frackers—see no end to boom times or low gas prices, industry insiders said in Chicago Friday.
Late last year the International Energy Agency predicted the U.S. would surpass Russia and Saudi Arabia to become the world’s largest energy producer by 2015 but would run out of gas, so to speak, in the 2020s. The U.S. Energy Information Administration made a similar assessment last year, predicting production would decline after 2020 and then increased demand would drive up gas prices.
But such glum assessments underestimate not only the amount of domestic shale oil and gas, but also the ingenuity of those tapping it, the insiders suggested Friday at the Energy Forward conference hosted by the Chicago Booth Energy Group.
“It’s amazing how much is out there, and we have very high confidence on most of these plays that they’re going to be very long lived,” said Robert Beck, who explores for Anadarko Petroleum Corp.
Most shale oil wells today start strong but taper off quickly compared to conventional wells, and some cease production in 7.5 to 8 years. But drilling technologies are evolving quickly to change that, said James King, a vice president for well competition with Baker Hughes, an oilfield services company.
“There are a lot of bright minds working today to make the wells have higher rates of production, slower decline curves, better terminal production and at less cost,” King said. “In the long term I think there will be technological solutions to fast decline curves and short-life wells.”
The U.S. will set records for oil production this year, King said. ”I would expect it’s sustainable. The technology didn’t just happen, it wasn’t just switched on, it evolved over time, and we’ll have better technologies than we did before.”
New technologies are likely to be employed re-fracking wells that seem depleted to current technologies.
“There’s nothing to keep you from fracking the same well a second time or a third time. As we go back to fracking these existing wells, what we might find is that we’ll have more patience and spend a little more money on the science up front to determine where to stimulate an existing well, and so we’ll be able to bring wells back on at least as strong as they were originally.”
The U.S. has an estimated 5 to 6 trillion barrels of oil locked up in shale, said Vance L. Scott of the management consulting firm A.T. Kearney—resources up to 15 times the size of the largest oil field in Saudi Arabia, he said. “To date we’ve used as a species, depending on the source, 700 billion to a trillion in oil.”
In its 2013 Outlook, the Energy Information Administration predicted gas prices would increase by 2040 to $7.65 per million BTU. The industry insiders at Friday’s conference, while not venturing so precise a prediction so far ahead, expect prices to stabilize at a lower level for the foreseeable future.
“Eventually we think the markets are going to balance between $4 and $5—$5.50 kind of the upper bound,” Scott said.
The financial advisory firm Lazard also expects gas prices to stabilize between $4.50 and $5. The firm hired “very contrarian thinkers” to try to burst the bubble of optimism within the industry, said George Bilicic, Lazard’s global head of power, energy and infrastructure.
“We hired a consultant about 18 months ago to do a very elaborate study for us on natural gas. We said, it cannot be that everyone is right about natural gas…. We said prove why everyone is wrong. And they came back—these very contrarian thinkers—they came back and said everyone is right.”
Asked how confident he was in Lazard’s $4.5o price estimate, Bilicic said “I’m not confident at all.” There’s an argument between bulls who see prices rising with economic growth and LNG exports and bears who expect the demand for gas to be undercut by energy efficiency, renewable energy, and environmental concerns. But Lazard’s calculations place the price in that range.
“We’re not so sure where gas prices will be over the long term. We do a highly proprietary and, of course because its Lazard, highly sophisticated levelized cost of energy analysis where we use long-term gas prices at about $4.50 or $5 across the U.S.”
“When we look at the reserves and we look at people’s ability to drill it’s hard to see how you’re going to see anything other than” that price, Bilicic said.
Environmental concerns remain the most overt threat to the boom.
“If you look at the carbon effects of natural gas and carbon is the issue, the difference between an all natural gas system and the system we have now, it’s not that much better from a carbon perspective, even displacing a lot of the coal,” Bilicic said. ”So we’re a little worried, but we think that’s the right outlook on things right now.”
Constraints could also come from unforeseen directions. Two years ago, there was a shortage of guar gum from India, a component of fracking fluids, and this winter’s polar vortex slowed transports of fracking sand from Wisconsin.
“Who would have thought little bitty things like guar and sand could slow the unconventional growth curve,” said Beck from Anadarko. “That’s another way the industry is different nowadays.”
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http://www.alternet.org/fracking/florida-finally-gets-mad-over-acid-fracking-near-vulnerable-wildlife-habitat
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http://dailysignal.com/2014/07/10/6-gallon-gas-prices-might-without-u-s-energy-boom/
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http://dailysignal.com/2014/07/10/6-gallon-gas-prices-might-without-u-s-energy-boom/
$6 /gallon, and getting worse.
Meanwhile, Germany is banning fracking, since - just ask Ukraine, it is so easy to buy energy from your friendly neighbor. Gas price in Germany, $8.28 and getting worse. http://www.eia.gov/countries/prices/gasolinewithtax.cfm
Meanwhile, fracking has no known incidents of poisoning ground water, and (posted elsewhere) the $100 Billion Germany is investing in solar will the delay the final destruction of the planet by 38 hours, according to peer-reviewed, scientific models.
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Doug posts:
"Meanwhile, fracking has no known incidents of poisoning ground water, and (posted elsewhere) the $100 Billion Germany is investing in solar will the delay the final destruction of the planet by 38 hours, according to peer-reviewed, scientific models."
If we replaced all coal with natural gas I wonder how much we could delay the end of humanity by.
Instead the left wants solar, etc that won't work for the bulk of what we need.
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Doug posts:
"Meanwhile, fracking has no known incidents of poisoning ground water, and (posted elsewhere) the $100 Billion Germany is investing in solar will the delay the final destruction of the planet by 38 hours, according to peer-reviewed, scientific models."
If we replaced all coal with natural gas I wonder how much we could delay the end of humanity by.
Instead the left wants solar, etc that won't work for the bulk of what we need.
If you did 200 projects worldwide on a scale of the $100 Billion German solar project, you would extend life on this planet by one year (using THEIR math).
That calculation is meaningless, of course. We aren't destroying the planet, the doom scenario is wildly exaggerated, and the energy production from these overly expensive sources is so minuscule that the gain from all them combined is meaningless.
Since that would do nothing, solve this a better way, through prosperity and free innovation. We know nuclear has zero CO2 emissions and many improvements and variations of it are barely in development stages. See next generation nuclear, pebble bed, Thorium, who knows? What we will use for power 100 years from now isn't going to be gasoline, especially if bureaucrats are not in the lead. Solar is great is some situations, and wind, and geothermal, but let them all compete on equal footing with every other idea.
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Energy Politics, Pathological Science Liars and Cognitive Dissonance of the Left all rolled into one:
http://www.telegraph.co.uk/earth/energy/fracking/11034270/Wind-farm-needs-700-times-more-land-than-fracking-site.html
Wind farm 'needs 700 times more land' than fracking site to produce same energy
Shale gas site 'creates the least visual intrusion' compared with wind or solar farm for same energy, according to Government's former chief scientific advisor on energy
By Emily Gosden, Energy Editor 14 Aug 2014
A wind farm requires 700 times more land to produce the same amount of energy as a fracking site, according to analysis by the energy department’s recently-departed chief scientific advisor. http://withouthotair.blogspot.co.uk/2014/08/shale-gas-in-perspective.html
Prof MacKay, who is Regius Professor of Engineering at the University of Cambridge, said that a shale gas pad of 10 wells would require just 2 hectares of land ...
By contrast, a wind farm capable of producing the same energy would span an area of 1,450 hectares, requiring 87 turbines each 328-foot tall. The large area covered by the farm as a whole would mean it would be visible from a surrounding area of between 5,200 and 17,000 hectares.
A solar farm generating equivalent energy would span a 924 hectare area, directly building on 208 hectares of it.
A spokesman for Cuadrilla said: "This comparison by David MacKay clearly demonstrates that, contrary to what some people may assume, exploration for and production of shale gas would actually have less far less impact on the countryside than wind or solar energy. "To supply an equivalent amount of energy a shale gas site would occupy just a small fraction of the land required for either wind or solar sites..."
The Department of Energy and Climate Change caused controversy last autumn when it published and then deleted from its website a graphic showing that onshore wind farms covering 250,000 acres would be required to generate as much power as the proposed Hinkley Point C nuclear power station in Somerset, which would cover 430 acres.
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Latest scientific study points to volcanic activity and magma displacement being responsible for glacial melting and rising oceans, NOT climate change or global warming. http://www.pnas.org/content/early/2014/06/04/1405184111.abstract?sid=5859c342-ec49-4de6-a82a-9b2c2c826b3e/
Evidence for elevated and spatially variable geothermal flux beneath the West Antarctic Ice Sheet
Dustin M. Schroeder1,
Donald D. Blankenship,
Duncan A. Young, and
Enrica Quartini
Edited by Mark H. Thiemens, University of California, San Diego, La Jolla, CA, and approved May 8, 2014 (received for review March 19, 2014)
Significance
Thwaites Glacier is one of the West Antarctica's most prominent, rapidly evolving, and potentially unstable contributors to global sea level rise. Uncertainty in the amount and spatial pattern of geothermal flux and melting beneath this glacier is a major limitation in predicting its future behavior and sea level contribution. In this paper, a combination of radar sounding and subglacial water routing is used to show that large areas at the base of Thwaites Glacier are actively melting in response to geothermal flux consistent with rift-associated magma migration and volcanism. This supports the hypothesis that heterogeneous geothermal flux and local magmatic processes could be critical factors in determining the future behavior of the West Antarctic Ice Sheet.
Abstract
Heterogeneous hydrologic, lithologic, and geologic basal boundary conditions can exert strong control on the evolution, stability, and sea level contribution of marine ice sheets. Geothermal flux is one of the most dynamically critical ice sheet boundary conditions but is extremely difficult to constrain at the scale required to understand and predict the behavior of rapidly changing glaciers. This lack of observational constraint on geothermal flux is particularly problematic for the glacier catchments of the West Antarctic Ice Sheet within the low topography of the West Antarctic Rift System where geothermal fluxes are expected to be high, heterogeneous, and possibly transient. We use airborne radar sounding data with a subglacial water routing model to estimate the distribution of basal melting and geothermal flux beneath Thwaites Glacier, West Antarctica. We show that the Thwaites Glacier catchment has a minimum average geothermal flux of ∼114 ± 10 mW/m2 with areas of high flux exceeding 200 mW/m2 consistent with hypothesized rift-associated magmatic migration and volcanism. These areas of highest geothermal flux include the westernmost tributary of Thwaites Glacier adjacent to the subaerial Mount Takahe volcano and the upper reaches of the central tributary near the West Antarctic Ice Sheet Divide ice core drilling site.
subglacial hydrology
ice-penetrating radar
Footnotes
1To whom correspondence should be addressed. E-mail: dustin.m.schroeder@utexas.edu.
Author contributions: D.M.S. designed research; D.M.S. performed research; D.M.S. contributed new reagents/analytic tools; D.M.S., D.D.B., D.A.Y., and E.Q. analyzed data; and D.M.S., D.D.B., D.A.Y., and E.Q. wrote the paper.
The authors declare no conflict of interest.
This article is a PNAS Direct Submission.
*Clow GD, Cuffey K, Waddington E, American Geophysical Union Fall Meeting, December 3–7, 2012, abstr C31A-0577.
This article contains supporting information online at www.pnas.org/lookup/suppl/doi:10.1073/pnas.1405184111/-/DCSupplemental.
Freely available online through the PNAS open access option.
P.C.
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"Latest scientific study points to volcanic activity and magma displacement being responsible for glacial melting and rising oceans"
Prentice,
Don't get your hopes up for this to fly in the MSM. Next thing we know this too will be explained away as being due to fracking.
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"Latest scientific study points to volcanic activity and magma displacement being responsible for glacial melting and rising oceans"
Prentice,
Don't get your hopes up for this to fly in the MSM. Next thing we know this too will be explained away as being due to fracking.
It was a great post nonetheless. There is a lot more going on in climate than the alarmists would like to tell us. People seem to understand this in polling.
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On my FB page there is a fellow who takes me to task for my doubts. I've posted PC's post there with a provocative tease. We will see what he makes of it.
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http://thinkprogress.org/climate/2014/09/02/3477823/texas-arsenic-fracking-study/
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http://thinkprogress.org/climate/2014/09/02/3477823/texas-arsenic-fracking-study/
http://water.usgs.gov/nawqa/trace/pubs/gw_v38n4/
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http://blogs.wsj.com/briefly/2014/09/16/5-things-about-bobby-jindals-energy-plan/
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All are simple and obvious:
Step 1: Encourage yet more production on private and state lands. This could be done with expeditious regulatory approvals, as opposed to today's heel-dragging, especially relating to collateral infrastructure from pipelines to refineries and ports (think Keystone pipeline). And to really accelerate things, we could offer the classes of tax credits, subsidies, and special favors now given to non-hydrocarbon energy.
Step 2: Completely repeal antiquated laws that constrain or ban exports of natural gas and petroleum. These anti-free-trade rules were put in place eons ago when people thought we were running out of energy. This no-cost move would, by itself, stimulate more production. American companies shouldn't have to ask for permission to sell to overseas buyers; the federal government should help them do it.
Step 3: Reduce corporate taxes, not just to stimulate more production and jobs, but also to accelerate the trend of foreign investment in the U.S. energy sector; nearly $200 billion has already flowed here in the past half-dozen years. We could even offer a tax holiday for the repatriation of foreign profits of American firms, provided the money supports the strategy.
Step 4: Open up federal lands for more oil and gas production to reverse the six-year decline in output under current policies. The feds control half America's land and nearly all off-shore domains, but lease under 2 and 6 percent, respectively, of the controlled territories. Let's have a policy to foster growth in production on federal lands to match what's happening on private and state lands.
http://www.realclearenergy.org/articles/2014/09/23/a_four-step_energy_strategy_for_our_time_108030.html
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With the abundance now available, why are we NOT making it available for cars, trucks and jets more quickly? Why are voters letting Democrats get away with blocking pipelines for safest transport of our cleanest fuels. Forget "energy independence". We should be producing, transporting, exporting and importing. Government has a role in keeping it clean and keeping it safe. After that, let the market sort it out.
http://news.bbc.co.uk/2/hi/americas/8224295.stm
"Natural gas is our cleanest fossil fuel. It can be used in cars, to generate electricity. It can be liquefied and used as jet aviation fuel," he says. "The natural gas that's being used in this country at this time can really get us to energy independence."
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Taking the Carbon Out of Coal
http://www.realclearpolitics.com/articles/2014/10/27/taking_the_carbon_out_of_coal_124374.html
When coal burns, it emits a "flue gas" teeming with hard-to-separate pollutants -- but it doesn't have to. Instead, it can create a simple flow of carbon dioxide that's easy to capture.
That's the bold idea behind coal-direct chemical looping, or CDCL. The technology has been proven only in the lab, and it has many hurdles to clear before it can be used to generate electricity and capture carbon on a commercial scale. But it holds the promise of electricity from coal with very little pollution, in a nation where coal provides 18 percent of all energy and 24 percent of all carbon emissions.
According to an economic analysis Ohio State helped to conduct, if brought to a commercial scale, CDCL could capture 96.5 percent of the carbon released during the process while increasing the cost of electricity by 28.8 percent.
In a best-case scenario, the demonstration could be built later this decade, followed by a commercial plant in the 2020s.
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Thanks Doug. Interesting promise of technology. I don't know if many coal companies can survive two more years of Duh Bamster and if the Hill/Bill team gets in it might be curtains for them.
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It's frustrating that this technology is commercially a decade out, but it is also disingenuous to hype climate predictions for a century as if technology advancement is over. All that is needed to solve our energy and environmental challenges is the will to do it and prosperity - the means to do it.
The centrally planned governments always had the worst environmental records, and still do.
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http://www.usatoday.com/story/money/markets/2014/11/02/opec-oil-stocks-energy-gas-middle-east/18247191/
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This struck me as well-balanced and fair.
http://www.vox.com/2014/11/14/7216751/keystone-pipeline-facts-controversy
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And surely Obama wants much lower energy prices (sarcasm emphasized). How is this for liberal spin and twisting logic on its head?:
How Obama (and Bush) helped drive down oil prices
Yahoo Finance By Rick Newman
21 hours ago
In this Friday, Dec. 12, 2014 photo, Quick Trip clerk Roxana Valverde adjusts the gas price sign numbers at a Tolleson, Ariz. QT convenience store as gas prices continue to tumble nationwide. The price of oil has fallen by nearly half in just six months, a surprising and steep plunge that has consumers cheering, producers howling and economists wringing their hands over whether this is a good or bad thing. (AP Photo/Ross D. Franklin)
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View photo
In this Friday, Dec. 12, 2014 photo, Quick Trip clerk Roxana Valverde adjusts the gas price sign numbers at a Tolleson, Ariz. QT convenience store as gas prices continue to tumble nationwide. The price of oil has fallen by nearly half in just six months, a surprising and steep plunge that has consumers cheering, producers howling and economists wringing their hands over whether this is a good or bad thing. (AP Photo/Ross D. Franklin)
Few people foresaw the nearly 50% plunge in oil prices this year. But the forces reshaping the oil market have been aligning for nearly a decade, with part of the impetus coming from Washington.
In 2007, Congress passed the Energy Independence and Security Act, which President George W. Bush promptly signed. The EISA raised federal mileage requirements for passenger cars for the first time since 1990, in an effort to reduce U.S. gas consumption and make America less dependent on foreign oil.
The new rules required automakers to achieve average fuel economy of 35 miles per gallon among all the new vehicles in their fleet by model year 2020 -- up sharply from a requirement of 27.5 MPG for cars and 22.2 MPG for light trucks (pickups and SUVs) at the time.
President Obama raised the MPG goal further in 2012, requiring average fuel economy of 54.5 MPG for all new vehicles sold by model year 2025. Automakers argued that the technology developments necessary to reach those levels would add thousands of dollars to the cost of a car, but so far they've been making progress without causing sticker shock for car buyers. A combination of electric vehicles, hybrids, diesels and far more efficient gas engines has helped improve overall average fuel economy by 5.3 MPG during the last seven years, according to the University of Michigan Transportation Research Institute. That's a big improvement that would cut the typical driver's gas consumption by about 70 gallons a year.
Overall, the MPG improvements have been working, with lower U.S. oil and gas consumption achieved, as this chart shows:
View photo
.Source: U.S. Energy Information Administration
Source: U.S. Energy Information Administration
The consumption decline that began in 2007 is partly due to people driving less during the recession of 2008 and 2009. However, gas consumption continued to fall until 2012, before ticking up in 2013. Even with that slight increase, gas consumption last year was at 2002 levels. When adjusted for population growth, consumption has fallen to levels of the late 1960s, when there were far fewer cars per household.
Reduced gas consumption in the United States is hardly the only factor affecting the price of oil, which trades globally and is determined by many variables. A surge in U.S. crude production has added to global supplies and aided in pushing down prices. Saudi Arabia has kept its own production levels steady rather than decreasing output -- as it has done during past gluts -- to prop up prices. Meanwhile, a sluggish global economy has kept demand for oil lower than many producers expected.
Still, weaker demand for gasoline in the world's largest economy accounts for some of the slack demand for oil. With the government's performance generally poor during the last decade of partisan fighting, the hike in MPG standards is a rare example of a policy with bipartisan support accomplishing what it was supposed to.
That's helping now in political confrontations with long-time foes such as Russia and Iran. Bush and Obama couldn't have foreseen the way cheap oil is inadvertently helping the West turn up the pressure on Russia in response to its role in Ukraine's civil war. But Iran and other oil producers, such as Venezuela, are U.S. antagonists that policymakers have long sought leverage over. Score one for Washington.
Fuel-economy improvements should continue and even accelerate, since the biggest gains are slated for the years approaching 2025. From 2020 through 2025, for instance, the MPG goal will rise from 41.7 MPG to 54.5, a 31% increase. From 2009 through 2014, it rose from 27.5 to 34.1, a 24% improvement. (MPG figures are slightly different from the Michigan numbers, which measure actual fuel economy of vehicles on the road.) That will continue dampening U.S. oil and gas consumption for the foreseeable future.
Demand for oil and gasoline will rise elsewhere, as more people drive in emerging economies such as China, India and Brazil. But those nations also will benefit as technology developed to reduce gas consumption in America proliferates and becomes cheaper. And that's an American export they won't even have to pay for.
Rick Newman’s latest book is Rebounders: How Winners Pivot From Setback To Success. Follow him on Twitter: @rickjnewman.
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One POV:
http://foreignpolicy.com/2014/12/23/is-saudi-arabia-trying-to-cripple-american-fracking-oil-iran/?utm_source=Sailthru&utm_medium=email&utm_term=*Editors%20Picks&utm_campaign=2014_EditorsPicksRS23%2F12
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One POV:
http://foreignpolicy.com/2014/12/23/is-saudi-arabia-trying-to-cripple-american-fracking-oil-iran/?utm_source=Sailthru&utm_medium=email&utm_term=*Editors%20Picks&utm_campaign=2014_EditorsPicksRS23%2F12
This makes perfect sense to me. Saudis don't mind slowing the US fracking acceleration but their direct threat is Iran and indirect threat is Russia. What they say to save face in front of fellow cartel members is just that.
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http://www.desmogblog.com/2014/10/07/central-california-aquifers-contaminated-billions-gallons-fracking-wastewater
http://www.biologicaldiversity.org/news/press_releases/2014/fracking-10-06-2014.html
I find this deeply disconcerting.
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http://www.desmogblog.com/2014/10/07/central-california-aquifers-contaminated-billions-gallons-fracking-wastewater
http://www.biologicaldiversity.org/news/press_releases/2014/fracking-10-06-2014.html
I find this deeply disconcerting.
Well, we know enviro groups would never hype things to scare the public.
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So, what are the facts here?
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So, what are the facts here?
Unknown, which is why it's important to find out what they are before falling for lefty scaremongering.
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http://energyindepth.org/california/center-biological-diversity-scare-tactics-fracking/
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http://www.americanthinker.com/blog/2014/01/top_saudi_lets_the_cat_out_of_the_bag.html#.Us1chIeAaGE.facebook
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Thank you. I have posted both of them back on the challenge/discussion in which I am engaged on my FB page.
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http://coloradopeakpolitics.com/2014/02/05/fractivists-discredited-again-salazar-says-fracking-is-safe/
If one cares about the environment, then fracking and nuclear power should be advocated.
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They have answered with this: http://www.nbcbayarea.com/investigations/Waste-Water-from-Oil-Fracking-Injected-into-Clean-Aquifers-282733051.html
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They have answered with this: http://www.nbcbayarea.com/investigations/Waste-Water-from-Oil-Fracking-Injected-into-Clean-Aquifers-282733051.html
It appears the state regulatory agency may have screwed up. So, the answer is more regulation? perhaps higher taxes and more state government employees?
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If the "environmentalists" want to be concerned about real pollution doing real harm, they'll stop California from outsourcing it's air pollution to the 4 corners and stop subsidizing toxins killing and maiming poor chinese who produce "green" products for "environmentalists" to pose with.
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http://www.pbs.org/newshour/bb/asia-july-dec09-china_12-14/
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https://m.youtube.com/watch?v=C4pnlWJT6FI&feature=youtu.be
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http://m.townhall.com/columnists/pauldriessen/2015/01/24/methane-deceptions-n1947451#
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I just reread this new item with the headlines Senate votes 99 to 1 that climate change is real. I didn't read the small print that it left out language that states it was man made. LOL. The Repubs pulled a fast one. Yet the MSM does not report it.
http://www.politico.com/story/2015/01/senate-climate-change-vote-114463.html
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A short, clever, educational video made by the Pacific Research Institute featuring the charismatic :wink: Steve Hayward of Powerline:
http://www.powerlineblog.com/archives/2015/01/whatever-happened-to-peak-oil.php
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Yes I remember from the Gilder days in the late 90's an article in Scientific American from a scientist who was sure oil reserves where on their way down.
Now we have them drilling miles below the ocean floor, in the arctic, oil sands and of course this:
http://www.economist.com/news/business/21582482-few-businesspeople-have-done-much-change-world-george-mitchell-father
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Most Americans Support Government Action on Climate Change, Poll Finds
An overwhelming majority of the American public, including nearly half of Republicans, support government action to curb global warming, according to a poll conducted by The New York Times, Stanford University and the nonpartisan environmental research group Resources for the Future.
In a finding that could have implications for the 2016 presidential campaign, the poll also found that two-thirds of Americans say they are more likely to vote for political candidates who campaign on fighting climate change. They are less likely to vote for candidates who question or deny the science of human-caused global warming.
Although the poll found that climate change was not a top issue in determining a person’s vote, a candidate’s position on climate change influences how a person will vote. For example, 67 percent of respondents, including 48 percent of Republicans and 72 percent of independents, said they were less likely to vote for a candidate who said that human-caused climate change is a hoax.
READ MORE »
http://www.nytimes.com/2015/01/31/us/politics/most-americans-support-government-action-on-climate-change-poll-finds.html?emc=edit_na_20150130
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WSJ
y
Erin Ailworth and
Benoît Faucon
March 13, 2015 7:21 p.m. ET
151 COMMENTS
The ocean of oil from U.S. shale drove crude prices back toward six-year lows Friday, and American energy companies say they are poised to unleash a further flood that would keep prices from returning to lofty levels for a long time.
The International Energy Agency reinforced the prospect of a prolonged slump in energy prices Friday, saying U.S. oil output was surprisingly strong in February and rapidly filling all available storage tanks. The Paris-based energy watchdog said this could lead to another sharp drop in crude prices, which fell by about 50% late last year.
The report sent oil prices tumbling around the world, with the global benchmark Brent crude falling $2.41 to $54.67 a barrel. The U.S. benchmark West Texas Intermediate lost $2.21 to settle at $44.84, less than 40 cents above a six-year low it reached in late January. Last summer, both traded well above $100.
It was only last month that the IEA said a price recovery seemed inevitable because the U.S. production boom was likely to cool. Instead, “U.S. supply so far shows precious little sign of slowing down,” the agency said Friday. “Quite to the contrary, it continues to defy expectations.”
Independent shale-oil producers have slashed their planned 2015 spending on drilling by $50 billion, compared with last year’s, but have promised to increase production by focusing on their best oil fields. Total U.S. crude oil production hit a high of 9.4 million barrels a day in the week ended March 6, according to federal data.
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Now many are adopting a new strategy that will allow them to pump even more crude as soon as oil prices begin to rise. They are drilling wells but holding off on hydraulic fracturing, or forcing in water and chemicals to free oil from shale formations. The delay in the start of fracking lets companies store oil in the ground in a way that enables them to tap it unusually quickly if they wish—and flood the market again.
This strategy could put a cap on how high oil prices can rise once they are recovering, said Ed Morse, global head of commodities research at Citigroup Inc.
“We’re in slightly unexplored territory,” Mr. Morse said. “It’s an experiment—a big, big experiment.”
ENLARGE
EOG Resources Inc., an oil producer based in Texas, is drilling about 285 wells that it won’t start finishing off until crude oil’s price rebounds to between $60 and $65 a barrel.
“When oil prices recover, EOG will be prepared to resume strong double-digit oil growth,” Chief Executive Bill Thomas said recently.
Some other big names in U.S. energy also are delaying well completions, among them Anadarko Petroleum Corp., Apache Corp., Chesapeake Energy Corp. and Continental Resources Inc. These four plus EOG pumped 312 million barrels of oil in the U.S. in 2014, or almost 10% of American crude production.
The number of wells in Texas and North Dakota that have been drilled but aren’t yet pumping is at least 3,000, RBC Capital Markets estimates. That oil still in the ground “provides a war chest that could temper fundamental price spikes in the coming year,” RBC analyst Scott Hanold wrote in a Friday note.
This essentially is more U.S. crude in storage, akin to that in the tanks now brimming. The U.S. has 449 million barrels of oil sloshing around in tanks, the highest level on record and almost 70% of capacity, according to the U.S. Energy Information Administration.
Even so, Jim Krane, an energy fellow at Rice University’s Baker Institute for Public Policy, questioned whether U.S. producers would be able to adjust oil production as quickly as, for instance, Saudi Arabia has proved able to do in the past. “We’ll probably have more price volatility because even as nimble as shale is, it’s not as nimble as OPEC,” he said. The shale producers “can’t just go out and turn a valve.”
It isn’t as though the price plunge hasn’t affected production.
The number of oil rigs drilling in the U.S. declined by 56 this week to 866, a 46% drop since early October when oil was traded for about $90 a barrel, according to oilfield-service company Baker Hughes Inc. Some production cutbacks are starting to materialize.
North Dakota regulators said Thursday the state’s oil output declined 3% in January from the record level reached in December.
Market observers have been waiting for U.S. shale production to cool down since November, when Saudi Arabia said it would keep pumping oil at high levels to preserve its own customer base. Some members of the Organization of the Petroleum Exporting Countries said at the time that the move would force American producers to cut pumping because their oil is relatively expensive to produce.
U.S. companies aren’t necessarily looking to fill OPEC’s shoes as the so-called swing producer that can adjust production to help set price levels.
For many, delaying oil production from drilled wells is a financial decision; finishing off a well and putting it into service accounts for 60% of the well’s total price.
By pushing off that expense, companies hope they can earn more from higher oil prices once they finally do pump and sell their crude. They also are expecting their costs will fall as oilfield-service providers vie for their business.
Harold Hamm, chief executive of Continental Resources Inc., a producer in North Dakota, has urged peers to hold off on completing as many wells as possible.
Continental is waiting to hook up 127 already-drilled wells, postponing up to $1 million in spending apiece.
“Save that money,” Mr. Hamm said recently.
“Avoid selling that production in this poor market and wait for service costs to fall before completing those wells. Most people are doing that,” he said.
Write to Erin Ailworth at Erin.Ailworth@wsj.com
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by
Matt Ridley
March 13, 2015 5:33 p.m. ET
WSJ
The environmental movement has advanced three arguments in recent years for giving up fossil fuels: (1) that we will soon run out of them anyway; (2) that alternative sources of energy will price them out of the marketplace; and (3) that we cannot afford the climate consequences of burning them.
These days, not one of the three arguments is looking very healthy. In fact, a more realistic assessment of our energy and environmental situation suggests that, for decades to come, we will continue to rely overwhelmingly on the fossil fuels that have contributed so dramatically to the world’s prosperity and progress.
In 2013, about 87% of the energy that the world consumed came from fossil fuels, a figure that—remarkably—was unchanged from 10 years before. This roughly divides into three categories of fuel and three categories of use: oil used mainly for transport, gas used mainly for heating, and coal used mainly for electricity.
Over this period, the overall volume of fossil-fuel consumption has increased dramatically, but with an encouraging environmental trend: a diminishing amount of carbon-dioxide emissions per unit of energy produced. The biggest contribution to decarbonizing the energy system has been the switch from high-carbon coal to lower-carbon gas in electricity generation.
On a global level, renewable energy sources such as wind and solar have contributed hardly at all to the drop in carbon emissions, and their modest growth has merely made up for a decline in the fortunes of zero-carbon nuclear energy. (The reader should know that I have an indirect interest in coal through the ownership of land in Northern England on which it is mined, but I nonetheless applaud the displacement of coal by gas in recent years.)
The argument that fossil fuels will soon run out is dead, at least for a while. The collapse of the price of oil over the past six months is the result of abundance: an inevitable consequence of the high oil prices of recent years, which stimulated innovation in hydraulic fracturing, horizontal drilling, seismology and information technology. The U.S.—the country with the oldest and most developed hydrocarbon fields—has found itself once again, surprisingly, at the top of the energy-producing league, rivaling Saudi Arabia in oil and Russia in gas.
The shale genie is now out of the bottle. Even if the current low price drives out some high-cost oil producers—in the North Sea, Canada, Russia, Iran and offshore, as well as in America—shale drillers can step back in whenever the price rebounds. As Mark Hill of Allegro Development Corporation argued last week, the frackers are currently experiencing their own version of Moore’s law: a rapid fall in the cost and time it takes to drill a well, along with a rapid rise in the volume of hydrocarbons they are able to extract.
And the shale revolution has yet to go global. When it does, oil and gas in tight rock formations will give the world ample supplies of hydrocarbons for decades, if not centuries. Lurking in the wings for later technological breakthroughs is methane hydrate, a seafloor source of gas that exceeds in quantity all the world’s coal, oil and gas put together.
So those who predict the imminent exhaustion of fossil fuels are merely repeating the mistakes of the U.S. presidential commission that opined in 1922 that “already the output of gas has begun to wane. Production of oil cannot long maintain its present rate.” Or President Jimmy Carter when he announced on television in 1977 that “we could use up all the proven reserves of oil in the entire world by the end of the next decade.”
That fossil fuels are finite is a red herring. The Atlantic Ocean is finite, but that does not mean that you risk bumping into France if you row out of a harbor in Maine. The buffalo of the American West were infinite, in the sense that they could breed, yet they came close to extinction. It is an ironic truth that no nonrenewable resource has ever run dry, while renewable resources—whales, cod, forests, passenger pigeons—have frequently done so.
The second argument for giving up fossil fuels is that new rivals will shortly price them out of the market. But it is not happening. The great hope has long been nuclear energy, but even if there is a rush to build new nuclear power stations over the next few years, most will simply replace old ones due to close. The world’s nuclear output is down from 6% of world energy consumption in 2003 to 4% today. It is forecast to inch back up to just 6.7% by 2035, according the Energy Information Administration.
Nuclear’s problem is cost. In meeting the safety concerns of environmentalists, politicians and regulators added requirements for extra concrete, steel and pipework, and even more for extra lawyers, paperwork and time. The effect was to make nuclear plants into huge and lengthy boondoggles with no competition or experimentation to drive down costs. Nuclear is now able to compete with fossil fuels only when it is subsidized.
As for renewable energy, hydroelectric is the biggest and cheapest supplier, but it has the least capacity for expansion. Technologies that tap the energy of waves and tides remain unaffordable and impractical, and most experts think that this won’t change in a hurry. Geothermal is a minor player for now. And bioenergy—that is, wood, ethanol made from corn or sugar cane, or diesel made from palm oil—is proving an ecological disaster: It encourages deforestation and food-price hikes that cause devastation among the world’s poor, and per unit of energy produced, it creates even more carbon dioxide than coal.
Wind power, for all the public money spent on its expansion, has inched up to—wait for it—1% of world energy consumption in 2013. Solar, for all the hype, has not even managed that: If we round to the nearest whole number, it accounts for 0% of world energy consumption.
Both wind and solar are entirely reliant on subsidies for such economic viability as they have. World-wide, the subsidies given to renewable energy currently amount to roughly $10 per gigajoule: These sums are paid by consumers to producers, so they tend to go from the poor to the rich, often to landowners (I am a landowner and can testify that I receive and refuse many offers of risk-free wind and solar subsidies).
It is true that some countries subsidize the use of fossil fuels, but they do so at a much lower rate—the world average is about $1.20 per gigajoule—and these are mostly subsidies for consumers (not producers), so they tend to help the poor, for whom energy costs are a disproportionate share of spending.
The costs of renewable energy are coming down, especially in the case of solar. But even if solar panels were free, the power they produce would still struggle to compete with fossil fuel—except in some very sunny locations—because of all the capital equipment required to concentrate and deliver the energy. This is to say nothing of the great expanses of land on which solar facilities must be built and the cost of retaining sufficient conventional generator capacity to guarantee supply on a dark, cold, windless evening.
The two fundamental problems that renewables face are that they take up too much space and produce too little energy. Consider Solar Impulse, the solar-powered airplane now flying around the world. Despite its huge wingspan (similar to a 747), slow speed and frequent stops, the only cargo that it can carry is the pilots themselves. That is a good metaphor for the limitations of renewables.
To run the U.S. economy entirely on wind would require a wind farm the size of Texas, California and New Mexico combined—backed up by gas on windless days. To power it on wood would require a forest covering two-thirds of the U.S., heavily and continually harvested.
John Constable, who will head a new Energy Institute at the University of Buckingham in Britain, points out that the trickle of energy that human beings managed to extract from wind, water and wood before the Industrial Revolution placed a great limit on development and progress. The incessant toil of farm laborers generated so little surplus energy in the form of food for men and draft animals that the accumulation of capital, such as machinery, was painfully slow. Even as late as the 18th century, this energy-deprived economy was sufficient to enrich daily life for only a fraction of the population.
Our old enemy, the second law of thermodynamics, is the problem here. As a teenager’s bedroom generally illustrates, left to its own devices, everything in the world becomes less ordered, more chaotic, tending toward “entropy,” or thermodynamic equilibrium. To reverse this tendency and make something complex, ordered and functional requires work. It requires energy.
The more energy you have, the more intricate, powerful and complex you can make a system. Just as human bodies need energy to be ordered and functional, so do societies. In that sense, fossil fuels were a unique advance because they allowed human beings to create extraordinary patterns of order and complexity—machines and buildings—with which to improve their lives.
The result of this great boost in energy is what the economic historian and philosopher Deirdre McCloskey calls the Great Enrichment. In the case of the U.S., there has been a roughly 9,000% increase in the value of goods and services available to the average American since 1800, almost all of which are made with, made of, powered by or propelled by fossil fuels.
Still, more than a billion people on the planet have yet to get access to electricity and to experience the leap in living standards that abundant energy brings. This is not just an inconvenience for them: Indoor air pollution from wood fires kills four million people a year. The next time that somebody at a rally against fossil fuels lectures you about her concern for the fate of her grandchildren, show her a picture of an African child dying today from inhaling the dense muck of a smoky fire.
Notice, too, the ways in which fossil fuels have contributed to preserving the planet. As the American author and fossil-fuels advocate Alex Epstein points out in a bravely unfashionable book, “The Moral Case for Fossil Fuels,” the use of coal halted and then reversed the deforestation of Europe and North America. The turn to oil halted the slaughter of the world’s whales and seals for their blubber. Fertilizer manufactured with gas halved the amount of land needed to produce a given amount of food, thus feeding a growing population while sparing land for wild nature.
To throw away these immense economic, environmental and moral benefits, you would have to have a very good reason. The one most often invoked today is that we are wrecking the planet’s climate. But are we?
Although the world has certainly warmed since the 19th century, the rate of warming has been slow and erratic. There has been no increase in the frequency or severity of storms or droughts, no acceleration of sea-level rise. Arctic sea ice has decreased, but Antarctic sea ice has increased. At the same time, scientists are agreed that the extra carbon dioxide in the air has contributed to an improvement in crop yields and a roughly 14% increase in the amount of all types of green vegetation on the planet since 1980.
That carbon-dioxide emissions should cause warming is not a new idea. In 1938, the British scientist Guy Callender thought that he could already detect warming as a result of carbon-dioxide emissions. He reckoned, however, that this was “likely to prove beneficial to mankind” by shifting northward the climate where cultivation was possible.
Only in the 1970s and 1980s did scientists begin to say that the mild warming expected as a direct result of burning fossil fuels—roughly a degree Celsius per doubling of carbon-dioxide concentrations in the atmosphere—might be greatly amplified by water vapor and result in dangerous warming of two to four degrees a century or more. That “feedback” assumption of high “sensitivity” remains in virtually all of the mathematical models used to this day by the U.N. Intergovernmental Panel on Climate Change, or IPCC.
And yet it is increasingly possible that it is wrong. As Patrick Michaels of the libertarian Cato Institute has written, since 2000, 14 peer-reviewed papers, published by 42 authors, many of whom are key contributors to the reports of the IPCC, have concluded that climate sensitivity is low because net feedbacks are modest. They arrive at this conclusion based on observed temperature changes, ocean-heat uptake and the balance between warming and cooling emissions (mainly sulfate aerosols). On average, they find sensitivity to be 40% lower than the models on which the IPCC relies.
If these conclusions are right, they would explain the failure of the Earth’s surface to warm nearly as fast as predicted over the past 35 years, a time when—despite carbon-dioxide levels rising faster than expected—the warming rate has never reached even two-tenths of a degree per decade and has slowed down to virtually nothing in the past 15 to 20 years. This is one reason the latest IPCC report did not give a “best estimate” of sensitivity and why it lowered its estimate of near-term warming.
Most climate scientists remain reluctant to abandon the models and take the view that the current “hiatus” has merely delayed rapid warming. A turning point to dangerously rapid warming could be around the corner, even though it should have shown up by now. So it would be wise to do something to cut our emissions, so long as that something does not hurt the poor and those struggling to reach a modern standard of living.
We should encourage the switch from coal to gas in the generation of electricity, provide incentives for energy efficiency, get nuclear power back on track and keep developing solar power and electricity storage. We should also invest in research on ways to absorb carbon dioxide from the air, by fertilizing the ocean or fixing it through carbon capture and storage. Those measures all make sense. And there is every reason to promote open-ended research to find some unexpected new energy technology.
The one thing that will not work is the one thing that the environmental movement insists upon: subsidizing wealthy crony capitalists to build low-density, low-output, capital-intensive, land-hungry renewable energy schemes, while telling the poor to give up the dream of getting richer through fossil fuels.
Mr. Ridley is the author of “The Rational Optimist: How Prosperity Evolves” and a member of the British House of Lords.
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second post
How U.S. LNG Production Will Ultimately Exploit Global Markets
Analysis
March 13, 2015 | 09:08 GMT
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Cheniere's LNG facility under construction at Sabine Pass in Louisiana. (ESRI/Gettys)
Summary
The growth of liquefied natural gas production in the United States is a charged political topic because of the standoff between Russia and the West. Russian energy giant Gazprom recently shrugged off the potential for U.S. LNG exports in European markets, noting that Russia can beat the United States on price. But given the number of natural gas projects under construction in North America, it is only a matter of time before the United States is influential in global markets. With the low cost of oil and declining LNG prices, it is important to examine the markets where U.S. LNG exports are most competitive. Though export costs make it difficult for the United States to enter European and Asian markets, should oil prices begin to rise, the linkage between LNG and oil prices in Asia will make the United States more competitive, and subsequently influential.
Analysis
In a world of low energy prices, the cost of shipping LNG from the United States to Europe or Asia is prohibitively expensive. Countries such as Qatar, Algeria and Norway can export LNG to Europe at a much-reduced cost, pricing the United States out of the market. In Asia, countries such as Malaysia, Brunei and Indonesia export LNG at prices the United States cannot match, at least for spot exports and short-term LNG contracts.
U.S. Competitiveness Abroad
In any attempt to undermine Russia's pipeline exports to Europe, the United States is at a disadvantage. Natural gas transportation by pipeline is significantly cheaper in most cases than building and employing expensive LNG port infrastructure. In terms of natural gas production and distribution, Russia's operating costs are low and their export infrastructure is already built. Some of Russia's most important markets, including those in Central Europe, already have spot prices around $6.60. Even now Russia's natural gas prices have not bottomed out, and prices at LNG hubs remain just as low.
Meanwhile, prices in the United Kingdom are around $7.16 per one million British thermal units (mmbtu) and about $6.92 per mmbtu in Belgium. However, some countries, such as the Baltic states, have proved willing to pay a little more for U.S. natural gas to keep Russian influence at a minimum. Lithuania and Houston-based company Cheniere Energy Inc. have a nonbinding natural gas deal for purchases, but only if prices are somewhat comparable to European norms.
Existing contracts coming out of the United States are based off the Henry Hub spot prices index, with a fixed fee added for liquefaction and transportation costs. Cheniere has signed several 20-year contracts for its Sabine Pass LNG facility, located in Louisiana, on the border with Texas. The contract terms typically run about 115 percent of the price of U.S. natural gas (currently $2.81 per mmbtu) with an additional $3.00 per mmbtu for liquefaction fees. After other charges for shipping, insurance and regasification are factored in, the total cost of U.S. natural gas at LNG terminals in Europe is anywhere from $7 to $8. Comparatively, natural gas prices in the United States are relatively low and will probably increase regardless of oil prices — oil and natural gas prices in the United States are not linked. In short, the United States is only marginally competitive at current LNG prices and cannot beat Russia's low potential operating costs.
The same disadvantages the United States faces in Europe also apply to Asia. LNG prices to South Korea, China and Japan are about the same as they are in Europe, only the cost of shipping is more because of the longer distances involved. With new LNG export capacity coming online in Australia, the United States has to compete with projects that are as capital intensive but closer to their export markets.
The Scale of Influence
While the United States does not threaten Russia's market share in Europe, or eventually Asia, the potential for exported U.S. LNG does improve Europe's leverage against Russia by providing an alternative source to draw from. Moreover, it helps create an LNG price ceiling when negotiating with Russia or other providers of natural gas. In time, the growth of North American LNG will force traditional import partners to undercut the price of new sources of natural gas.
The exact scale of U.S. LNG exports is unclear and largely dependent on price. Most likely exports will be in the order of 50 billion cubic meters, a sizable addition to the global LNG supply. In addition, between now and 2020, the United States and Australia alone could increase the global LNG supply by as much as 150 bcm; the market in 2013 was just 325 bcm. The Sabine Pass LNG facility will ramp up production later this year, but other facilities still under construction will not see first production until 2017 or 2018 at the earliest. Russia and other competitors still have a few years to secure markets and undermine potential LNG contracts by offering lower prices.
The global growth of LNG markets will help European markets move away from contracts indexed to oil prices, as an alternative to creating natural gas pricing hubs. This will eventually enable natural gas and oil prices to decouple, as seen in the United States. This process is important for the European Union and is a cornerstone of its Third Energy Package and Energy Union Package. Even Russia has begun transitioning in some cases, the most notable example being Gazprom's May 2014 deal with Italy: Gazprom caved on the pricing mechanism to ENI, basing it on spot prices instead of Gazprom's preferred contracts, which are in turn based on oil prices.
Should oil prices increase, Asian LNG prices would see the biggest change, dominated as they are by oil-indexed long-term contracts. Because the Asian market is roughly five times the size of Europe's, most of the contracts signed by U.S. LNG exporters have been with the region. South Korea, China and Japan are also three top importers, offering more potential and greater opportunity.
The United States is also in a position to exploit local markets in need of natural gas, such as Brazil, Argentina and Mexico, countries distanced from LNG suppliers further afield. However, the overall LNG markets of Brazil, Mexico and Argentina are small, and all three are major energy producers in their own right.
With all these factors in mind, the five U.S. LNG projects that are already under construction will eventually come online, much like those under construction in Australia. But many U.S. projects without final investment decisions will probably get delayed and may not even be built at all. The expansion of existing projects under construction is a more plausible option. Ultimately, the United States will not be able to compete with Russia in Europe and Asia directly. Rather, the addition of its sizable LNG exports to the global market will help Europe shift its contracts with Russia and lead to more opportunities in Asia.
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I have always said there is a proper role for regulation to protect the water table. My initial response to the following is that it seems like a suitable step at this time.
by Amy Harder and
Daniel Gilbert
Updated March 20, 2015 7:11 p.m. ET
234 COMMENTS
WASHINGTON—The Obama administration issued comprehensive rules on hydraulic fracturing, trying to set a national standard for controversial drilling practices that have helped fuel the U.S. oil and natural-gas boom.
Friday’s move sparked immediate criticism from energy companies that claimed the rules are too onerous. Two industry groups filed a lawsuit minutes after the announcement, seeking to block the rules in a federal court. Environmental groups said the rules don’t go far enough.
The new rules from the Interior Department have been in the works since 2012 and apply to oil-and-gas drilling on federal lands, which produce 11% of the natural gas consumed in the U.S. and 5% of the oil, according to data from the agency. More than 90% of new land-based wells in the U.S. use hydraulic fracturing, known as fracking.
Drilling on private or state-owned land won’t be subject to the new federal standards, but states and companies could move to bring their practices in line with the U.S. While big energy-producing statessuch as Colorado, North Dakota, Pennsylvania and Texas regulate fracking already, there have been no overarching standards.
“It’s a complex matrix of regulations out there,” said Neil Kornze, director of the Interior Department’s Bureau of Land Management. “In some places, this has been addressed. In other places it has not. We’ve attempted to build a rule that will interface in a positive way with those states that have moved forward and will provide a common baseline across the country in all states.”
Fracking involves blasting a slurry of water, sand and chemicals into a well to break up dense rock and allow the outward flow of oil and gas. The process has unlocked vast reserves of oil and gas across the U.S.
But fracking is controversial because of qualms about environmental impact, especially the potential to contaminate drinking-water supplies.
“There is a lot of fear and public concern, particularly about the safety of groundwater and the impact of these operations,” Interior Secretary Sally Jewell said Friday.
Analysts said parts of the federal regulations are as strict as or stricter than what many states have implemented, though state rules vary.
For example, the new federal rules require more stringent standards than many states have for storage of toxic fluids recovered from a fracking well. U.S. officials said companies must secure wastewater in covered tanks before permanent disposal, instead of using pits dug in the ground.
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While some energy firms have objected to the higher costs of storing fracking-related wastewater in tanks, federal officials concluded that it would help guard against spills.
Eric Kraus, a spokesman for Clean Harbors Inc., a Norwell, Mass., provider of wastewater treatment and other oil-and-gas-industry services, said the storage rules “would be a significant change to methods employed today.”
Ten states now require at least some of the fluids used in fracking to be stored in covered tanks, said Resources for the Future, an environmental think tank in Washington. Storing leftover liquids in open pits has been common in Texas and North Dakota, which recently outlawed the practice.
“We think this is going to be a template for how the federal government expects the states to regulate water as part of their own oversight of fracking,” said Kevin Book, managing director of energy research firm ClearView Energy Partners.
The Interior Department estimated that complying with the new rules will cost $11,400 per drilling operation, or less than 1% of the cost of drilling a well. The figure roughly doubled from an earlier proposal.
The government estimated an industrywide cost of $32 million a year, up from an earlier estimate of $12 million to $20 million.
The likelihood of higher fracking costs comes as U.S. oil and gas producers are struggling with persistently low natural-gas prices and a roughly 50% drop in the price of crude in the past year. The collapse in oil prices has prompted many drillers to slash their budgets and lay off workers.
Exxon Mobil Corp. and other energy companies have expressed concerns that new federal rules would increase how long it takes to process drilling applications. But the drilling slowdown as a result of low oil prices might ease some of those concerns as companies apply for fewer permits. The number of rigs drilling on land in the U.S. fell to a new six-year low on Friday, according to oil-field services company Baker Hughes Inc.
Under the Interior Department rules, energy companies also will be required to test the quality of cement work designed to prevent natural gas from seeping outside a well. The rule will require companies seeking drilling permission to provide more information about existing wells nearby. In some cases, drilling near old, abandoned wells has caused gas to pollute aquifers.
Barry Russell, president and chief executive of the Independent Petroleum Association of America, said the federal government’s “so-called baseline standards will threaten America’s economic upturn, while further deterring energy development on federal lands.”
The trade group, which says it represents producers that drill 95% of the oil and natural-gas wells in the U.S., and regional group the Western Energy Alliance sued the Interior Department in U.S. District Court in Wyoming.
The trade groups said the new rules are a “reaction to unsubstantiated concerns” and should be thrown out. Interior Department officials said they expect the rules to withstand challenges.
In a move that upset environmental groups, the new rules require companies to publicly disclose chemicals they use through an industry-run website called FracFocus within 30 days of completing the fracking process.
Environmental groups had pushed for upfront disclosures directly to the Interior Department.
“While this proposal has improved from previous versions, it represents a missed opportunity to set a high bar for protections that would truly increase transparency and reduce the impacts,” said Madeleine Foote, legislative representative for the League of Conservation Voters.
Companies have been fracking for decades, but the practice has come under scrutiny in recent years as its use skyrocketed.
—Erin Ailworth contributed to this article.
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PRAGUE, Okla. — Yanked without warning from a deep sleep, Jennifer Lin Cooper, whose family has lived near here for more than a half-century, could think only that the clamor enveloping her house was coming from a helicopter landing on her roof. She was wrong.
A 5.0-magnitude earthquake — the first of three as strong or stronger over several days in November 2011 — had peeled the brick facade from the $117,000 home she bought the year before. Ms. Cooper, 36, could not get out until her father pried a stuck storm door off the front entrance. Repairs have so far cost $12,000 and forced her to take a second job, at night, to pay the bill.
At a packed town hall meeting days later, Ms. Cooper said, state officials called the shocks, including a 5.7 tremor that was Oklahoma’s largest ever, “an act of nature, and it was nobody’s fault.”
Many scientists disagree. They say those quakes, and thousands of others before and since, are mainly the work of humans, caused by wells used to bury vast amounts of wastewater from oil and gas exploration deep in the earth near fault zones. And they warn that continuing to entomb such huge quantities risks more dangerous tremors — if not here, then elsewhere in the state’s sprawling well fields.
“As long as you keep injecting wastewater along that fault zone, according to my calculations, you’re going to continue to have earthquakes,” said Arthur F. McGarr, the chief of the induced seismicity project at the federal Earthquake Science Center in Menlo Park, Calif., who has researched the Prague quakes. “I’d be a little worried if I lived there. In fact, I’d be very worried.”
But in a state where oil and gas are economic pillars, elected leaders have been slow to address the problem. And while regulators have taken some protective measures, they lack the money, work force and legal authority to fully address the threats.
More than five years after the quakes began a sharp and steady increase, the strongest action by the Republican governor, Mary Fallin, has been to name a council to exchange information about the tremors. The group meets in secret, and has no mandate to issue recommendations.
The State Legislature is not considering any earthquake legislation. But both houses passed bills this year barring local officials from regulating oil and gas wells in their jurisdictions.
The state seismologist’s office, short-staffed, has stopped analyzing data on tremors smaller than magnitude 2.5 — even though a recent study says those quakes flag hidden seismic hazards “that might prove invaluable for avoiding a damaging earthquake.”
The governor referred an interview request to Michael Teague, her energy and environment secretary. Mr. Teague said the governor’s earthquake council was helping coordinate the response to the shocks and that underfunded regulators and scientists had benefited from efforts to find new state and federal assistance for their work.
“It’s not working well enough if your house is shaking, absolutely no doubt,” he said. “But it’s working very well.”
But others say the political will is missing to confront an earthquake threat tied to Oklahoma’s dominant industry.
It is “a dangerous game of Russian roulette,” said Jason Murphey, the Republican state representative from earthquake-ridden Guthrie, in central Oklahoma. “If a dangerous earthquake happens and causes lots of damage and injuries,” he said, “a cloud will hang over the energy sector for a long time to come.”
If scientists see dangers, many Oklahomans are wary of disrupting an industry so woven into everyday life.
The state’s oil and gas wells gush profits to corporate owners, but also royalties to farmers and homeowners, and tax payments to the state and cities. By some accounts the industry supports as many as one in five Oklahoma jobs. It showers Oklahoma universities with millions of dollars in donations and helps make dreams like Oklahoma City’s N.B.A. franchise, reality.
It is also a major political contributor to Ms. Fallin, legislators and all three elected members of the Oklahoma Corporation Commission, which oversees oil and gas production and disposal wells.
“We always want to be invited to the prom,” said State Representative Cory Williams, a Democrat from Stillwater, the home of Oklahoma State University and one of the state’s most seismically active areas. “And we’ve decided that oil and gas is the best prom date we’ll ever get, and we don’t want oil and gas to go away.”
Those blessings, however, are not unalloyed.
From 2010 to 2013, Oklahoma oil production jumped by two-thirds and gas production rose by more than one-sixth, federal figures show. The amount of wastewater buried annually rose one-fifth, to nearly 1.1 billion barrels. And Oklahoma went from three earthquakes of magnitude 3.0 or greater to 109 — and to 585 in 2014, and to 750-plus this year, should the current pace continue. In the United States, only Alaska is shaken more.
The Corporation Commission lacks explicit authority to regulate earthquake risks. So it is trying to contain the risks posed by roughly 3,200 active wastewater disposal wells using laws written to control water pollution.
Last spring, the commission began trying to weed out quake risks by scrutinizing wells near larger quakes for operational problems and permit violations. A few dozen wells made modifications; four shut down. It is now difficult to win approval for new wells near stressed faults, active seismic areas or the epicenters of previous quakes above 4.0 magnitude. Regulators significantly expanded the areas under scrutiny last month. Yet the quakes continue.
Privately, some companies are cooperating with regulators and scientists by offering proprietary information about underground faults. Publicly, the industry wants Oklahomans to beware of killing the golden goose.
Many in the industry were reluctant to comment for this article. But Kim Hatfield, the regulatory chairman of the Oklahoma Independent Petroleum Association and president of Crawley Petroleum, warned: “A reaction of panic is not useful.” Shutting down disposal wells and the industry they serve, he added, “will make ‘The Grapes of Wrath’ look like a cheery movie.”
A Surge in Wastewater
The mechanics of wastewater-induced earthquakes are straightforward: Soaked with enough fluid, a layer of rock expands and gets heavier. Earthquakes can occur when the pressure from the fluid reaches a fault, either through direct contact with the soaked rock or indirectly, from the expanding rock. Seismologists have documented such quakes in Colorado, New Mexico, Arkansas, Kansas and elsewhere since the 1960s.
But nowhere have they approached the number and scope of Oklahoma’s quakes, which have rocked a fifth of the state. One reason, scientists suspect, is that Oklahoma’s main waste disposal site, a bed of porous limestone thousands of feet underground, lies close to the hard, highly stressed rock containing the faults that cause quakes.
The salty, sometimes toxic wastewater is a byproduct of extracting oil and gas, whether by hydraulic fracturing of once-unreachable shale deposits, commonly called fracking, or from conventional wells. Most is pumped out of the ground with oil or gas, then returned to the earth in a so-called disposal well, often at a different location.
The Corporation Commission faces a complicated task. It can order a shutdown or operational change only one well at a time, and only if a well violates its operating permit or is clearly tied to an earthquake risk.
But geologists say the sheer volume of waste being buried in an area with many wells — and not any single well — causes most quakes. It often is difficult or impossible to assess blame to a particular well.
Some other states like Arkansas and, this week, Kansas, have imposed blanket shutdowns or cutbacks on wells near active quake zones. “We don’t have the ability or the legal authority to issue a moratorium,” Dana Murphy, one of the three elected corporation commissioners, said in an interview.
“We do have the ability to take certain actions in emergency situations,” she continued. “But that’s emergencies when they start happening. It doesn’t talk about what happens before the emergencies occur.”
The 2011 quakes that damaged Ms. Cooper’s home in Prague (pronounced “prayg”) illustrate the regulators’ limited reach.
Acting on geologists’ suspicions after the first temblor, regulators tested and pored over operations data from three wells — two small ones and a huge one, called Wilzetta, sunk by the Tulsa-based company New Dominion in 1999. They were seeking some definitive cause of the tremor.
They found none. The wells still pump today, even as worried regulators wave off operators who want to sink new ones. Indeed, by December 2013, Wilzetta had nearly doubled its average monthly volume of waste compared with the months before the 2011 shocks.
Without convincing evidence that a well poses a seismic threat, one official said, regulators are powerless to order precautions, much less shutdowns. “Shut it in? How?” said that official, who spoke on the condition of anonymity because he was barred from discussing specific cases. “Show me the cause. Show me the violation.”
Continue reading the main story
Hamstrung, regulators now may have pushed their authority to its limits. Beginning last May, the commission began tightening permits for new disposal wells, requiring seismicity tests and requiring shutdowns if quakes occurred nearby.
More than five years after earthquakes began a sharp and steady increase in Oklahoma, the strongest action by Gov. Mary Fallin has been to name a council to exchange information about the tremors. Credit Sue Ogrocki/Associated Press
Existing wells were unaffected. But last month the agency required operators of hundreds of wells to prove they were not accidentally pumping wastewater into bedrock, which seismologists say raises earthquake risks.
“We are operating on the assumption that time is of the essence,” a regulatory program manager at the commission, Matt Skinner, said in an interview.
Scientists certainly agree.
Federal seismologists have for a year warned of rising earthquake risks. Last July, researchers stated in Science magazine that wastewater-induced earthquakes were approaching a fault near Oklahoma City capable of producing a magnitude 7.0 shock, though other experts call that unlikely. In January, scientists including Oklahoma’s state seismologist, Austin Holland, cited a rising quake risk and identified three faults capable of “significantly larger” earthquakes.
Last month, a South African geophysicist delivered the most specific warning yet: Another magnitude 5-plus quake could occur by 2016, and one fault running through Stillwater and two other cities potentially could yield up to a magnitude 6.5 shock.
anthony
7 hours ago
Oklahoma, Thanks so much for making Texas look good. I did not think it was possible.
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While scientists worry, political leaders have been slow to recognize the threat.
First elected in 2010, Governor Fallin appointed the earthquake advisory council last September. “Oklahoma has always had seismic activity, but the reality is we are seeing more,” she said then. “It’s important that we study this issue and have sound science that can inform decisions.”
She allowed only last week that wells accidentally drilled into rock containing faults could “potentially” set off shocks. Scientists say that is only one factor at play in the quakes.
The governor’s 12-member earthquake advisory council, drawn from industry, government, the Legislature and academia, works as an information clearinghouse, said Mr. Teague, her energy and environment secretary and the group’s chairman.
“The whole idea of the group,” he said, “is what are you working on? What are the gaps that you’ve got, and is there somebody else that can fill that gap?”
The most glaring gaps, however, remain mostly unfilled.
Photo
Sandra Ladra and her husband, Gary, near their home in Prague. Ms. Ladra, whose knees were battered by a collapsing fireplace during the 2011 earthquakes, has sued well operators. Credit Nick Oxford for The New York Times
Last month the state promised a clerk, two technical experts and $50,000 to help regulators assess wells, but a $600 million-plus budget deficit makes significant aid unlikely. The Legislature could grant the commission greater authority, but legislators say that is not an option in a state where regulation is deeply unpopular, and the oil and gas industry holds political and economic sway.
Residents File Suit
The industry has worked on several fronts to contain concern about the quakes.
In October 2013, almost two years after the Prague quakes, Dr. Holland, the state seismologist, issued a news release warning that the earthquake risk in Oklahoma City, about 50 miles west of Prague, had increased. Wastewater disposal wells, he added, may be “a contributing factor.” Two weeks later, he was summoned to the office of the University of Oklahoma’s president, David L. Boren, to meet Harold G. Hamm, the chairman of Continental Resources, one of the state’s biggest oil and gas companies. Mr. Boren sits on Continental’s board, for which he has been paid more than $1.6 million in stock awards and directors’ fees since 2009, according to proxy statements.
Continental officials did not respond to a request for comment. Last month, after the newsletter EnergyWire reported the meeting, Mr. Boren called the session “purely informational.”
Dr. Holland said that Mr. Boren assured him his academic freedom as a scientist was unchallenged. Then, Dr. Holland said, Mr. Hamm told him that public discussions of disposal wells “are unnerving — they can dramatically affect the industry.”
Continental is seeking to shape that public discussion, arguing in newspapers, on television and to regulators that the earthquake epidemic is not man-made, but part of an unusually active period for quakes worldwide.
Still, in public meetings and in courtrooms, some residents have begun to demand an accounting. In August, Sandra Ladra, a Prague resident injured by a collapsing fireplace during the 2011 earthquakes, sued the Wilzetta well’s operator, New Dominion, and the Spess Oil Company, which operates the two smaller wells nearby.
Then, in February, came a class-action lawsuit against the two companies by Ms. Cooper, whose house in Prague was heavily damaged. Her suit seeks compensation for quake damage not only to her home, but to any homes in nine counties surrounding Prague.
That case has yet to be heard. But Ms. Ladra’s suit, now before the State Supreme Court, previews the industry response: The wells operate legally, and regulators should hear complaints against them. Letting juries decide their culpability in earthquakes invites financial disaster.
“I don’t want to belittle the public’s concern about earthquake swarms. I live here, too,” Robert G. Gum, a lawyer for New Dominion, said at an October hearing. “But it’s no more important to the people sitting in this courtroom and the people in this state than the state’s economy. It’s no more important in recognizing how important the oil and gas industry is to that economy.”
If juries hold the companies liable for Prague’s earthquakes, he added, “I doubt if this is the last lawsuit that will get filed. These wells will become economic and legal liability pariahs. They will be shut down.”
To Ms. Cooper, that message is clear. “People need to just take their losses for the greater good of the oil and gas companies — you know, do your part,” she said.
She does not buy it.
“If the truth destroys something,” she said, “then it needs to be destroyed.”
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http://www.nytimes.com/2015/04/11/us/new-sea-drilling-rule-planned-5-years-after-bp-oil-spill.html?emc=edit_th_20150411&nl=todaysheadlines&nlid=49641193
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http://www.dailykos.com/story/2014/02/21/1279443/-Exxon-CEO-Joins-Lawsuit-to-Stop-Fracking-Near-His-Home?detail=facebook
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(http://i1.wp.com/www.powerlineblog.com/ed-assets/2015/11/energy-consumption.jpg)
Look closely at the bottom of the chart for the huge gains in solar and wind energy that came from taxpayer subsidies approaching $100 billion a year.
Ok, raise your hand if you still think solar and wind are the answer going forward.
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Obama rejecting Keystone this morning.............and who did not see this coming?
http://www.nytimes.com/2015/11/07/us/obama-expected-to-reject-construction-of-keystone-xl-oil-pipeline.html (http://www.nytimes.com/2015/11/07/us/obama-expected-to-reject-construction-of-keystone-xl-oil-pipeline.html)
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Obama rejecting Keystone this morning.............and who did not see this coming?
http://www.nytimes.com/2015/11/07/us/obama-expected-to-reject-construction-of-keystone-xl-oil-pipeline.html (http://www.nytimes.com/2015/11/07/us/obama-expected-to-reject-construction-of-keystone-xl-oil-pipeline.html)
They rejected it after the company withdrew the request.
President Bozo is looking at the above chart in this thread and thinking solar and wind are just about ready to replace fossil fuels. Good grief.
Or maybe he is looking at the energy transport safety record upside down and thinking the pipeline has the worst record.
Study shows pipeline oil transport poses fewer risks than rail or truck
The study, Intermodal Safety in the Transport of Oil, determined that the rate of injury requiring hospitalisation was 30 times lower among oil pipeline workers compared to rail workers involved in the transport of oil, based on extensive data collected in the United States. Road transport fared even worse, with an injury rate 37 times higher than pipelines based on reports to the US Department of Transportation for the period 2005-2009.
The study also found the risk of spill incidents is lower for pipelines per billion ton-miles of oil movement compared to rail and road.
Safety Records Show Pipelines Best Method for Transporting Oil
http://www.internationalresourcejournal.com/north_america/study_shows_pipeline_oil_transport_poses_fewer_risks-than-rail_o.html
The guy who wasted away a couple of trillion on not-shovel-ready projects says there are better infrastructure investments we could make. Small distinction, this isn't a public investment!
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What is not mentioned is that Warren Buffett owns the railroads that ship the oil that the pipeline would replace.
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Indeed!
For new readers, please note that we here have noted that repeatedly.
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http://fee.org/anythingpeaceful/mit-incandescents-now-more-efficient-than-leds/
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The whole modus operandi to ethanol was that it would reduce CO2 in the atmosphere. We now know this is false. So why are politicians not doing there duty and withdrawing subsidies for this? Of course we all know it is because they fear big agriculture:
http://www.ewg.org/agmag/2015/05/how-corn-ethanol-worse-climate-change-keystone-pipeline
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That would include one Donald Trump but exclude on Ted Cruz.
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Trump is for subsidies and Cruz not?
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That is correct. Trump is for ethanol subsidies-- which are quite popular in Iowa, and Cruz has the character to stand against them.
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That is correct. Trump is for ethanol subsidies-- which are quite popular in Iowa, and Cruz has the character to stand against them.
Cruz has character. Trump has a nifty combover.
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That is correct. Trump is for ethanol subsidies-- which are quite popular in Iowa, and Cruz has the character to stand against them.
Perfect example of special interest politics, same for the sugar subsidies. (Sorry to say Rubio was insincere on that one.)
There is a similar problem opening the nuclear storage site at Yucca Mountain where we already have $15 Billion invested.
http://instituteforenergyresearch.org/analysis/yucca-mountain-the-safe-future-for-nuclear-energy/
Where do they stand on that? Whoever wants to lose Nevada can take the strongest stand - and not get it done.
Which candidate could get elected and get these things fixed? To do any of them, it has to be part of a process of correcting all of them. (What's your favorite special interest subsidy? It also could be driven by Congress onto the Executive.
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We have no hope of seeing the debt cost curve go down in a stable fashion.
Again I ask why are not these candidates held to account on the debt during debates?
Or even interviews?
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http://wattsupwiththat.com/2016/01/23/saturday-silliness-wind-turbine-photo-of-the-year/
(https://wattsupwiththat.files.wordpress.com/2016/01/de-icing-wind-turbine.jpg?w=906&h=558)
The entire rationale for wind turbines is to stop global warming by reducing the amount of CO2 being returned to the atmosphere from the burning of fossil fuels.
In the attached picture, recently taken in Sweden, freezing cold weather has caused the rotor blades of a wind turbine to ice up bringing the blades to a complete stop.
To fix the “problem” a helicopter is employed (burning aviation fuel) to spray hot water (which is heated in the frigid temperatures using a truck equipped with a 260 kW oil burner) on the blades of the turbine to de-ice them.
The aviation fuel, the diesel for the truck, and the oil burned to heat the water, could produce more electricity (at the right time to meet demand) than the unfrozen wind turbine could ever produce. (Before it freezes up again).
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Imagine all the green jobs that could be created if people were paid to stand there with blow dryers...
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Some new clean energy alternatives that regulators are strangling:
http://reason.com/archives/2016/01/29/advanced-reactor-nuclear-power-resurgenc
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http://money.cnn.com/2016/02/02/investing/saudi-arabia-oil-madeleine-albright/index.html
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Interesting energy politics and economics going on here:
http://www.the-american-interest.com/2016/02/04/lone-star-shale-producers-defy-opec/
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Russia is considering copying the Saudis oil war with US drillers by flooding Europe with cheap natural gas:
https://finance.yahoo.com/news/gazprom-braces-gas-price-war-221041925.html
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Kept afloat by tax dollars?
http://www.breitbart.com/london/2016/03/20/the-solar-industry-is-dying-good-riddance/
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Kept afloat by tax dollars?
http://www.breitbart.com/london/2016/03/20/the-solar-industry-is-dying-good-riddance/
There was another solar financial collapse last week, largest ever, hardly reported, bailed out (again) by the government that made the anti-economic investment possible in the first place.
http://www.powerlineblog.com/archives/2016/03/the-great-solar-epic-fail-of-all-time.php
The large scale solar projects are burning up birds, like wind power is chopping them up, while nuclear power is still carbon free and can now be built to withstand a tsunami.
I like solar energy as an off grid, security and independence-based private luxury that becomes a necessity if and when the grid fails, not as a pretend cost-effective alternative to nuclear, natural gas or newer innovations.
It should be sold that way, as a niche product. Everyone who can afford it and wants protection against a terror-based grid shut down should buy and install enough solar and other alternatives to survive and function in those times.
Good luck heating your house with solar - at night.
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"Everyone who can afford it and wants protection against a terror-based grid shut down should buy and install enough solar and other alternatives to survive and function in those times. "
Every human being has a right to *free* solar protection.
Even the "undocumented" are humans just like us and deserve to be treated like humans beings. :wink:
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Who knew? It's an MIT publication (highly respected institution?), but the analysis of this new fact I think is wrong.
In the US at least, emissions are down because of fracking, not because of solar kleptocracies.
China is cutting back on coal because of soot and smog, not because of global conscience or agreements over CO2 that makes crops and forests grow more vibrantly. The global economy is sick and mostly stagnant, which also slows emissions. The largest capacity carbon-free fuel is nuclear, still largely untapped.
Still the peak is noteworthy.
https://www.technologyreview.com/s/601055/global-carbon-dioxide-emissions-have-now-been-flat-for-two-years-running/#/set/id/601047/
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Things that make you go "hmmmm , , ,"
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http://www.marketwatch.com/story/could-californias-massive-ivanpah-solar-power-plant-be-forced-to-go-dark-2016-03-16
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http://www.dailykos.com/story/2016/04/01/1508986/-Stanford-scientists-find-that-fracking-has-clear-impact-on-drinking-water-in-Wyoming?detail=facebook
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http://www.dailykos.com/story/2016/04/01/1508986/-Stanford-scientists-find-that-fracking-has-clear-impact-on-drinking-water-in-Wyoming?detail=facebook
Daily Kos? :roll:
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1) Sometimes we need to know what the other side is saying.
2) Let's be real-- it's not like there aren't some operators out there capable of cutting corners and fouling the water table. This is a proper area for regulatory oversight IMHO.
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1) Sometimes we need to know what the other side is saying.
2) Let's be real-- it's not like there aren't some operators out there capable of cutting corners and fouling the water table. This is a proper area for regulatory oversight IMHO.
Well, hopefully the EPA can break away from from causing it's own environmental disasters and porn to investigate. If the Daily Kos even got 5% of the story right, I would be surprised.
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http://www.upi.com/Business_News/Energy-Industry/2016/04/06/OMV-makes-drilling-breakthrough-in-Barents-Sea/4451459934525/
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http://www.americanthinker.com/blog/2016/04/public_university_admits_to_burying_study_finding_no_damage_to_water_quality_from_fracking_because_funders_disappointed.html?utm_source=twitterfeed&utm_medium=twitter
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http://www.americanthinker.com/blog/2016/04/public_university_admits_to_burying_study_finding_no_damage_to_water_quality_from_fracking_because_funders_disappointed.html?utm_source=twitterfeed&utm_medium=twitter
"Science" isn't really science when the researchers and publicists put bias above truth.
Readers of the forum have had the facts for a long time:
Studies show fracking does not hurt ground water
http://dogbrothers.com/phpBB2/index.php?topic=1096.msg80439#msg80439
http://dogbrothers.com/phpBB2/index.php?topic=1096.msg80513#msg80513
http://dogbrothers.com/phpBB2/index.php?topic=1096.msg73659#msg73659
http://dogbrothers.com/phpBB2/index.php?topic=1096.msg46669#msg46669
Hydraulic Fracturing –15 Statements from State Regulatory Officials
Babies diapers don't have this clean of a report.
http://www.hydraulicfracturing.com/Documents/Hydraulic_Fracturing_SGEIS_comments.pdf
(I picked these quotes out of longer documents. I see the detail is now missing at the source link. - Doug)
"After 25 years of investigating dtizen complainls of contamination, DMRM geologists
have not documented a single inddent involVing contamination of ground water
attributed to hydraulic fracturing." - Ohio Department of Natural Resources
After review of DEP's complaint database and interviews with regional staff that
investigate groundwater contamination related to oil and gas activities, no groundwater pollution
or disruption of underground sources of drinking water has been attributed to hydraulic
fracturing of deep gas fonnations. - Pennsylvania Department of Environmental Protection
"we have found no example of contamination of usable water where the cause was claimed to. be hydraUlic fracturing." - New Mexico Energy, Minerals and Natural Resources Department
"I can state with authority that there have been no documented cases of drinking water
contamination caused by such hydraulic fracturing operations in our State." - STATE OIL AND GAS BOARD OF ALABAMA
"Though hydraulic fracturing has becn
used for over 50 years in Texas, our records do not indicate a single documented contamination case
associated with hydraulic fracturing." - chief regulatory agency over oil and gas activities in Texas
"There have been no verified cases of harm to ground water in the State of Alaska as a result of
hydraulic fracturing." - Commissioner Alaska Oil and Gas Conservation Commission
"To the knowledge of the Colorado Oil and Gas Conservation Commission staff, there has been
no verified instance of harm to groundwater caused by hydraulic fracturing in Colorado."
"There have been no instances where the Division of Oil and Gas has verified that harm to
groundwater has ever been found to be the result of hydraulic fracturing in Indiana." - Director
Indiana Department of Natural Resources
"The Louisiana Office of Conservation is unaware of any instance of harm to groundwater in the
State of Louisiana caused by the practice of hydraulic fracturing."
"My agency, the Office of Geological Survey (OGS) of the Department of Environmental
Quality, regulates oil and gas exploration and production in Michigan. Hydraulic fracturing has been utilized extensively for many years in Michigan, in both deep formations and in the relatively shallow Antrim Shale formation. There are about 9,900 Antrim wells in Michigan producing natural gas at depths of 500 to 2000 feet. Hydraulic fracturing has been used in virtually every Antrim well.
There is no indication that hydraulic fracturing has ever caused damage to ground water or other
resources in Michigan."
"No documented cases of groundwater contamination from fracture stimulations in
Wyoming."
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http://ecowatch.com/2016/05/09/radium-lead-fracking/
Thousands of oil and gas industry wastewater spills in North Dakota have caused “widespread” contamination from radioactive materials, heavy metals and corrosive salts, putting the health of people and wildlife at risk, researchers from Duke University concluded in a newly released peer-reviewed study.
North Dakota, Williston—Bakken—Oil and Gas—Missouri River. Photo Credit: EcoFlight
Bakken Oil and Gas in Williston, North Dakota on the Missouri River. Photo Credit: EcoFlight
Some rivers and streams in North Dakota now carry levels of radioactive and toxic materials higher than federal drinking water standards as a result of wastewater spills, the scientists found after testing near spills. Many cities and towns draw their drinking water from rivers and streams, though federal law generally requires drinking water to be treated before it reaches peoples’ homes and the scientists did not test tap water as part of their research.
High levels of lead—the same heavy metal that infamously contaminated water in Flint, Michigan—as well as the radioactive element radium, were discovered near spill sites. One substance, selenium, was found in the state’s waters at levels as high as 35 times the federal thresholds set to protect fish, mussels and other wildlife, including those that people eat.
The pollution was found on land as well as in water. The soils in locations where wastewater spilled were laced with significant levels of radium and even higher levels of radium were discovered in the ground downstream from the spills’ origin points, showing that radioactive materials were soaking into the ground and building up as spills flowed over the ground, the researchers said.
The sheer number of spills in the past several years is striking. All told, the Duke University researchers mapped out a total of more than 3,900 accidental spills of oil and gas wastewater in North Dakota alone.
Contamination remained at the oldest spill site tested, where roughly 300 barrels of wastewater were released in a spill four years before the team of researchers arrived to take samples, demonstrating that any cleanup efforts at the site had been insufficient.
“Unlike spilled oil, which starts to break down in soil, these spilled brines consist of inorganic chemicals, metals and salts that are resistant to biodegradation,” said Nancy Lauer, a Duke University PhD student who was lead author of the study, which was published in Environmental Science & Technology. “They don’t go away; they stay.”
“This has created a legacy of radioactivity at spill sites,” she said.
The highest level of radium the scientists found in soil measured more than 4,600 Bequerels per kilogram [bq/kg]—which translates to roughly two and half times the levels of fracking-related radioactive contamination discovered in Pennsylvania in a 2013 report that drew national attention. To put those numbers in context, under North Dakota law, waste more than 185 bq/kg is considered too radioactive to dispose in regular landfills without a special permit or to haul on roads without a specific license from the state.
And that radioactive contamination—in some places more than 100 times the levels of radioactivity as found upstream from the spill—will be here to stay for millennia, the researchers concluded, unless unprecedented spill clean-up efforts are made.
“The results of this study indicate that the water contamination from brine spills is remarkably persistent in the environment, resulting in elevated levels of salts and trace elements that can be preserved in spill sites for at least months to years,” the study concluded. “The relatively long half-life of [Radium 226] (∼1600 years) suggests that [Radium] contamination in spill sites will remain for thousands of years.”
Cleanup efforts remain underway at three of the four sites that the Duke University research team sampled, a North Dakota State Health Department official asked to comment on the research told the Bismarck Tribune, while the fourth site had not yet been addressed. He criticized the researchers for failing to include any in-depth testing of sites where the most extensive types of cleanup efforts had been completed.
The four sites the researchers sampled instead included the locations of two of the biggest spills in the state’s history, including a spill of 2.9 million gallons in January 2015 and two areas where smaller spills occurred in 2011. The samples from the sites were collected in June 2015, with funding from the National Science Foundation and the Natural Resources Defense Council, an environmental group.
Over the past decade, roughly 9,700 wells have been drilled in North Dakota’s Bakken shale and Bottineu oilfield region—meaning that there has been over one spill reported to regulators for every three wells drilled.
brine_fracking_750
“Until now, research in many regions of the nation has shown that contamination from fracking has been fairly sporadic and inconsistent,” Avner Vengosh, professor of geochemistry and water quality at Duke’s Nicholas School of the Environment, said when the study was released. “In North Dakota, however, we find it is widespread and persistent, with clear evidence of direct water contamination from fracking.”
Dealing with wastewater generated by drilling and fracking has proved to be one of the shale industry’s most intractable problems. The industry often pumps its toxic waste underground in a process known as wastewater injection. Every day, roughly 2 billion gallons of oil and gas wastewater are injected into the ground nationwide, the Environmental Protection Agency estimates. Wastewater injection has been linked to swarms of earthquakes that have prompted a series of legal challenges.
The sheer volume of waste generated by the industry—particularly from the type of high volume horizontal hydraulic fracturing used to tap shale oil and gas—has often overwhelmed state regulators, especially because federal laws leave the waste exempt from hazardous waste handling laws, no matter how toxic or dangerous it might be, under an exception for the industry carved out in the 1980’s.
This leaves policing fracking waste up to state inspectors and not only do the rules vary widely from state to state, but enforcing those rules brings its own difficulties.
State inspectors have faced escalating workloads as budgets have often failed to keep pace with the industry’s rapid expansion. In North Dakota, the number of wells per inspector climbed from roughly 359 each in 2012 to 500 per inspector last year. In other states, the ratios are even more challenging, with Wyoming oil and gas well inspectors being responsible for more than 2,900 wells in 2015. And now, with the collapse of oil and gas prices, funds earmarked for oil and gas inspection have also nosedived in many states.
Lax enforcement may help explain why wastewater spills are so common across the U.S. More than 180 million gallons of wastewater was spilled between 2009 and 2014, according to an investigation by the Associated Press, which tallied the amount of wastewater spilled in the 21,651 accidents that were reported to state or federal regulators nationwide during that time.
The naturally occurring radioactive materials in that wastewater have drawn particular concern, partly because of their longevity in the environment and partly because the drilling industry enjoys looser federal standards for their radioactive waste than many other industries.
In January, North Dakota regulators further relaxed their standards for the dumping of radioactive materials, allowing many landfills in the state to accept drilling waste at levels higher than previously permitted, citing tough economic times for drillers.
But environmentalists argue that relaxing the rules for radioactive waste disposal could mean that radioactive materials receive less careful handling. “If people think this study points to a building tragedy, just wait,” Darrell Dorgan, who chairs the North Dakota Energy Industry Waste Coalition, told the Bismarck Tribune, when the Duke University research was released. “The new rules allow radioactive waste that is 10 times more dangerous.”
The spills the Duke University researchers identified often resulted from a failure to maintain infrastructure including pipelines and storage tanks. Roughly half of the wastewater spilled came from failed pipelines, followed by leaks from valves and other pipe connectors and then tank leaks or overflows.
But recent floods in Texas’s Eagle Ford shale region also highlight the risks that natural disasters in drilling regions might pose. Texas regulators photographed plumes of contamination around submerged drilling sites, a repeat of similar incidents in Colorado. “That’s a potential disaster,” Dr. Walter Tsou, former president of the American Public Health Association told the Dallas Morning News.
Risks associated with fracking in flood zones have drawn the attention of some federal agencies in the past, but perhaps not in a way that locals in affected areas might find helpful.
In 2012, the Federal Emergency Management Agency’s Hazard Mitigation Grant Program—a program designed to help people move away from areas subject to recurring floods—ran into a series of conflicts over oil and gas leases on properties that would otherwise be offered buy-outs. Some homeowners in Pennsylvania were denied the chance to participate in the program because of oil and gas leases or pipelines on their properties, as DeSmog previously reported.
In other words, it may be harder for those who have signed oil and gas or pipeline leases to abandon flood-prone areas, meaning that homeowners whose properties frequently flood could potentially face battles over cleanup costs without aid from the Federal Emergency Management Agency.
And the newly published research from North Dakota suggests that the less visible brines may ultimately be more of a long-lasting environmental hazard than the spilled oil.
Even though their study included only leaks that were reported to state regulators, the researchers warned that little is currently being done to clean up sites where spills have occurred—or even to track smaller spills, especially on reservation lands, where roughly a quarter of the state’s oil is produced.
This means that the real amount of wastewater spilled is likely even higher than currently reported.
“Many smaller spills have also occurred on tribal lands,” Prof. Vengosh said, “and as far as we know, no one is monitoring them.
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We will have to keep an eye on this. Industrial activity in ND is also up by about 50,000-fold, so of course there are more accidents and more problems. Banned are pipelines that specifically eliminate most spills. Not mentioned. Enforcement no doubt can't keep up; they are busy making their own spills out in Colorado How do all these combined match up with that one? No mention made. Also checked the site, they are 100% negative on nuclear as well, not just fracking, even though it doesn't tend to have these emissions. Were the spills all a result of the Obama administration refusing to approve a pipeline - that is proven to reduce spills? No mention of that. Just that these micro-spills could pose a 'health risk' to wildlife or humans. But is there a known case of a health issue that came out of this? No mention of that either. I assume not, or they don't follow a story all the way like the National Enquirer would. Enquiring minds want to know! The levels reported are always the "highest level" recorded. Three thousand spills were not at that level. Mixing those measures is what activists do, not what scientists do. If lead or selenium spills, it has lead or selenium in it at the site of the spill. It also had lead and selenium in it wherever it was before or without fracking. What caused the spill, let's stop doing that. No mention of that. Highest recorded levels are only compared to a regulatory standard, not to actual levels occurring elsewhere. What are considered poisons here are minerals from the ground going back into the ground. The earth is radioactive in places, with or without a spill and contains lead and selenium. If these are known spills above a regulatory standard, were there known tickets written? Were any regulators fired? Disciplined? There seems to be a lot missing from this story. Aren't these minerals that filter out of drinking water quite easily? Not mentioned. What did von trappe say to the Nazis, we seem to suffer from a "deplorable lack of curiosity".
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From that same publication, "ecowatch", as the fracking scare:
"It [30th anniversary of Chernobyl] also comes as advancing efficiencies and plunging prices in renewable energy remind us that nukes stand in the way of solving our climate crisis."
http://ecowatch.com/2016/04/25/chernobyl-harvey-wasserman/
[What the hell does the Soviet debacle of Chernobyl have to do with 2016 nuclear energy production?]
- In fact it is because nuclear is so clean, safe, abundant and efficient that nuclear energy is the enemy of the planet. In comparison, nuclear energy makes solar and wind projects look puny, limited, inefficient, helpless and foolish.
The more that we delay or oppose new nuclear capacities, the more fossil fuels we burn, the more radium we spill, the more children will die, and the more we will warm the planet. We have no time to wait on this...
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Spill map from the anti-fracking post:
(http://ecowatch.com/wp-content/uploads/2016/05/brine_fracking_750.jpg)
Very impressive. How many deaths, none? Nowhere in the history of their publication do they publish a map showing all locations of actual bird deaths from wind energy. These are cases of actual wildlife deaths, not just 'health risks posed'. You would think 'ecowatch' (and Duke University) would be all over that, or are birds not wildlife, or are they agenda driven?
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Well, when the wind turbines break, or aren't working because of a lack of wind, they aren't shredding birds. Then they only burn taxpayer's money we don't have.
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Sorry gents but as best as I can tell neither of you are responding to the assertions of the article.
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Sorry gents but as best as I can tell neither of you are responding to the assertions of the article.
Respectfully disagree. The quality of the reporting is quite suspect, noticeably agenda driven and non-scientific, unlike the actual study to which they refer: http://drcinfo.org/wp-content/uploads/2016/04/ND-brine-spill.pdf. The highest levels could be eyedropper size while the map shows gallons, not contamination levels. The assertions of the article are badly in need of context, IMHO.
Shock reporting is great, but where are the deaths? Where are the overflowing hospitals? Where are the photos of dead wildlife? Where is one example of this showing up in a city's drinking water? Is there an instance or data sample of a North Dakota spill issue bleeding over to another state, making the problem federal? - No.
They show a beautiful photo of the Missouri River. What are the Radium, Lead and Selenium levels in the Missouri River downstream before and after fracking? I'm sorry Crafty, but it's just not in there. What specifically are the allegations to address?
Should fracking be regulated and should spill cleanups be mandated? - Yes. Should negligence that harms others be subject to civil and criminal actions? - Yes. Is there a case of that cited? - No.
The study itself focuses largely on saline solution (salt). Where I live, the DOT puts that on every highway, every snowfall in the interest of public safety. The I-35 bridge that collapsed had a sprinkler system of it - right over the Mississippi River! http://www.nytimes.com/2001/12/13/technology/how-it-works-black-ice-wise-bridge-repelling-the-foe-before-it-forms.html
Of course radiation is a great concern for public safety. In the study these elements are called NORM, naturally occurring radioactive materials. At the TSA, radioactive exposure is mandated for every traveler. Again, context is needed.
http://www.cbsnews.com/pictures/airport-scanners-and-12-must-know-radiation-risks/
They are producing a million barrels of oil per day and there have been 3000 incidents of a valve leaking etc. reported over the last decade. That is terrible, dangerous, and unacceptable, COMPARED TO WHAT? I'm afraid that understanding this story is ALL about context.
Here is a compared-to-what story: http://www.cnn.com/2015/08/09/us/colorado-epa-mine-river-spill/
Three million toxic gallons were "spilled" by the regulators contaminating drinking water and irrigation in 3 states plus the Navajo Nation. EPA initially denied two million gallons of it and falsely called it unavoidable. Whatever.
The result of the (federally funded) study above is that further study is warranted.
Should we take more from that than they do?
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Now THAT is responsive!!! :-D
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The Sand Mines That Ruin Farmland
By NANCY C. LOEBMAY 23, 2016
Chicago — WHILE the shale gas industry has been depressed in recent years by low oil and gas prices, analysts are predicting that it will soon rebound. Many of the environmental hazards of the gas extraction process, called hydraulic fracturing or fracking, are by now familiar: contaminated drinking water, oil spills and methane gas leaks, exploding rail cars and earthquakes.
A less well-known effect is the destruction of large areas of Midwestern farmland resulting from one of fracking’s key ingredients: sand.
Fracking involves pumping vast quantities of water and chemicals into rock formations under high pressure, but the mix injected into wells also includes huge amounts of “frac sand.” The sand is used to keep the fissures in the rock open — acting as what drilling engineers call a “proppant” — so that the locked-in oil and gas can escape.
Illinois, Wisconsin and Minnesota are home to some of the richest agricultural land anywhere in the world. But this fertile, naturally irrigated farmland sits atop another resource that has become more highly prized: a deposit of fine silica sand known as St. Peter sandstone. This particular sand is valued by the fracking industry for its high silica content, round grains, uniform grain size and strength. These qualities enable the St. Peter sand to withstand the intensity of fracking, and improve the efficiency of drilling operations.
In the Upper Midwest, this sandstone deposit lies just below the surface. It runs wide but not deep. This makes the sand easy to reach, but it also means that to extract large quantities, mines have to be dug across hundreds of acres.
At the end of 2015, there were 129 industrial sand facilities — including mines, processing plants and rail heads — operating in Wisconsin, up from just five mines and five processing plants in 2010. At the center of Illinois’s sand rush, in LaSalle County, where I am counsel to a group of farmers that is challenging one mine’s location, The Chicago Tribune found that mining companies had acquired at least 3,100 acres of prime farmland from 2005 to 2014.
In the jargon of the fracking industry, the farmland above the sand is “overburden.” Instead of growing crops that feed people, it becomes berms, walls of subsoil and topsoil piled up to 30 feet high to hide the mines.
But the effects cannot be hidden indefinitely. These mines are destroying rural communities along with the farmland. Homesteads and small towns are being battered by mine blasting, hundreds of diesel trucks speed down rural roads dropping sand along the way, stadium lighting is so bright it blots out the night sky, and 24-hour operations go on within a few hundred feet of homes and farms. As a result, some farmers are selling and moving away, while for those determined to stay, life is changed forever.
Quality of life is not their only concern. Silica is a human carcinogen and also causes lung disease, including silicosis. Because of its dangers, silica is heavily regulated in the workplace, but there are generally no regulations for silica blown around from the sand-mining operations. These mines also use millions of gallons of groundwater every day. Local wells are running dry, and the long-term availability of water for homes and farms is threatened.
Because of the recent slowdown in the fracking industry, many of the sand mines stopped or slowed production, providing temporary respite to these rural communities. But with oil edging back up toward $50 a barrel, and projected to go higher, the Midwest farmlands face a renewed threat.
The sand mines do promise jobs. But it’s shortsighted to rely on a new fracking boom when we’ve already seen how vulnerable the business is to cyclical dips. America’s frac sand industry shrank to about $2 billion last year from $4.5 billion after the price of oil plummeted in 2014. As mines were mothballed or shuttered, hundreds of miners and truckers were laid off.
Even assuming a coming recovery, there may be as few as 20 to 30 jobs in a mine covering hundreds of acres — a mine that may operate for only 20 years. When the sand is exhausted, the mine is a hole in the ground and the jobs are gone. The farms that it replaced provided employment and sustenance for centuries.
There are alternatives to this despoliation. Not all frac sand is buried under prime farmland. Texas, Kansas, Arkansas and Oklahoma all have usable frac sand that is not “burdened” by rich prairie earth, and transportation costs there are often lower.
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In the Midwest, we badly need more legal restraints on how frac sand mines operate. People must be protected from blowing silica. Sand piles should be covered and mines set a safe distance from homes, farms, schools and public spaces. At present, such regulations are often lax, and local residents have rarely won the needed protections from local or state governments eager to cash in on the boom.
Groundwater, too, needs stronger safeguards. A good example to follow is LaSalle County, which in 2013 placed a moratorium on new high-capacity wells needed for mining pending the results of a United States Geological Survey study in part funded by Northwestern, where I teach, of the capacity of groundwater supplies to support new mines.
Unfettered frac sand mining is ruining the rural communities of the Midwest. All people are left with are thousands of acres of holes in the ground in place of what was once rich, productive farmland. That is too high a price to pay.
Nancy C. Loeb, the director of the Environmental Advocacy Center, is an assistant clinical professor at Northwestern University’s Pritzker School of Law.
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May I respectfully ask how the news of this health and safety crisis was spread, through Facebook suggested readings?
Quoting a different post, "People think backwards. They choose the position that makes the emotional statement they wish to make about who they are, then they learn the facts and reasons to justify it. ( - Crafty)
Did this professor come across these facts and develop opposition or do these activists oppose industry and search for facts? If fracking is so bad, (it has lowered our greenhouse gas emissions enormously), then does same activist professor support no-sand, no CO2, nuclear energy? I didn't think so.
We weren't polluting the drinking water so now sand coming from the ground put back into the ground is the new pollutant!!
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The Sand Mines That Ruin Farmland (excepted for response)
A less well-known effect is the destruction of large areas of Midwestern farmland...
Illinois, Wisconsin and Minnesota are home to some of the richest agricultural land anywhere in the world.
- Is farm production down because of fracking in IL, WI and MN? Same activists oppose advances in farmland productivity.
In the Upper Midwest, this sandstone deposit lies just below the surface. It runs wide but not deep. This makes the sand easy to reach, but it also means that to extract large quantities, mines have to be dug across hundreds of acres.
- A huge amount of land is measured in "hundreds" of acres? In another area of our state, BWCA, we ban production of everything in "millions" of acres.
At the end of 2015, there were 129 industrial sand facilities — including mines, processing plants and rail heads — operating in Wisconsin, up from just five mines and five processing plants in 2010.
- Sounds like a lot of jobs in areas that were losing jobs!
At the center of Illinois’s sand rush, in LaSalle County, where I am counsel to a group of farmers that is challenging one mine’s location...
- Neighbors opposing what other neighbors produce. The definition of leftism - or sand-envy?
The Chicago Tribune found that mining companies had acquired at least 3,100 acres of prime farmland from 2005 to 2014.
- Looking at average farm size excluding hobby farms, that is roughly one farm acquired in ten years. OMG!
In the jargon of the fracking industry, the farmland above the sand is “overburden.” Instead of growing crops that feed people, it becomes berms, walls of subsoil and topsoil piled up to 30 feet high to hide the mines.
- Would also block the wind and minimize the environmental impact. No? Again, show us the loss of total crop production. Meanwhile the fracking industry showed us the only economic growth in the country over a two term presidency.
These mines are destroying rural communities along with the farmland. Homesteads and small towns are being battered by mine blasting, hundreds of diesel trucks speed down rural roads dropping sand along the way, stadium lighting is so bright it blots out the night sky, and 24-hour operations go on within a few hundred feet of homes and farms. As a result, some farmers are selling and moving away, while for those determined to stay, life is changed forever.
- The ugly sound of economic activity. Factories open, product shipped. It was so much more peaceful when these communities were losing all their young people and becoming ghost towns.
Silica is a human carcinogen and also causes lung disease...
- We are taking this poison, sand, out of shallow ground where our food is produced and putting deep in the ground. Ms. Loeb, how many deaths? Meanwhile fracking replaced hundreds of millions of tons of far more dangerous and environmentally damaging coal production, also carcinogenic: http://www.sourcewatch.org/index.php/Health_effects_of_coal
Because of the recent slowdown in the fracking industry, many of the sand mines stopped or slowed production, providing temporary respite to these rural communities.
- Sounds like a self-correcting problem. No need for the highly paid, federally funded activists??
The sand mines do promise jobs. But it’s shortsighted to rely on a new fracking boom when we’ve already seen how vulnerable the business is to cyclical dips. America’s frac sand industry shrank to about $2 billion last year from $4.5 billion after the price of oil plummeted in 2014. As mines were mothballed or shuttered, hundreds of miners and truckers were laid off.
- "Crisis? What Crisis? (Supertramp, 1975)
In the Midwest, we badly need more legal restraints on how frac sand mines operate. People must be protected from blowing silica. Sand piles should be covered and mines set a safe distance from homes, farms, schools and public spaces.
- Fair enough.
Unfettered frac sand mining is ruining the rural communities of the Midwest.
- The largest problem today in rural communities is meth.
Nancy C. Loeb, the director of the Environmental Advocacy Center, is an assistant clinical professor at Northwestern University’s Pritzker School of Law.
- Who knew? This article was written by lawyer, not a scientist. 70% of research funding at this "private" university comes from the federal government. We are quickly running out of under-regulated businesses;the activists with their rich research and activism budgets are getting nervous.
This reminds me of the concerns brought forward by the Short Corn Society that the corporate media won't cover. Tall corn must be banned because small children can get lost in it. How many children have been lost so far, you ask? Isn't the possibility of one child lost too great a risk?!!
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Al Gore's TV channels could have done a documentary on this, but he sold it to Gulf Oil Sheiks. Oh well.
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Al Gore's TV channels could have done a documentary on this, but he sold it to Gulf Oil Sheiks. Oh well.
Sand-gate. Is this really all they have left?
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Al Gore's TV channels could have done a documentary on this, but he sold it to Gulf Oil Sheiks. Oh well.
Sand-gate. Is this really all they have left?
Sand and plastic bags.
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A Great Line That No-One Noticed At The GOP Convention:
"Every time we can't drill a well in America, terrorism is being funded!"
- Harold Hamm, credited with discovering the Bakken oil fields
http://www.investors.com/politics/commentary/a-great-line-that-no-one-noticed-at-the-gop-convention/
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Some truths see light...
Germany, the leader in renewables, uses 40% coal! "In Germany, where renewables have mostly replaced nuclear power, carbon emissions are rising, even as Germans pay the most expensive electricity rates in Europe."
In the fight against CO2 emissions, we are phasing out the largest source of emission free power generation. Dumb, even by liberals (and POTH) standards. Nuclear, gas and coal plants don't switch on and off on a dime when the sun and the wind go down.
http://www.nytimes.com/2016/07/20/business/energy-environment/how-renewable-energy-is-blowing-climate-change-efforts-off-course.html?smid=fb-share&_r=0
How Renewable Energy Is Blowing Climate Change Efforts Off Course
Is the global effort to combat climate change, painstakingly agreed to in Paris seven months ago, already going off the rails?
Germany, Europe’s champion for renewable energy, seems to be having second thoughts about its ambitious push to ramp up its use of renewable fuels for power generation.
Hoping to slow the burst of new renewable energy on its grid, the country eliminated an open-ended subsidy for solar and wind power and put a ceiling on additional renewable capacity.
Germany may also drop a timetable to end coal-fired generation, which still accounts for over 40 percent of its electricity, according to a report leaked from the country’s environment ministry. Instead, the government will pay billions to keep coal generators in reserve, to provide emergency power at times when the wind doesn’t blow or the sun doesn’t shine.
Renewables have hit a snag beyond Germany, too. Renewable sources are producing temporary power gluts from Australia to California, driving out other energy sources that are still necessary to maintain a stable supply of power.
In Southern Australia, where wind supplies more than a quarter of the region’s power, the spiking prices of electricity when the wind wasn’t blowing full-bore pushed the state government to ask the power company Engie to switch back on a gas-fired plant that had been shut down.
But in what may be the most worrisome development in the combat against climate change, renewables are helping to push nuclear power, the main source of zero-carbon electricity in the United States, into bankruptcy.
The United States, and indeed the world, would do well to reconsider the promise and the limitations of its infatuation with renewable energy.
“The issue is, how do we decarbonize the electricity sector, while keeping the lights on, keeping costs low and avoiding unintended consequences that could make emissions increase?” said Jan Mazurek, who runs the clean power campaign at the environmental advocacy group ClimateWorks.
Addressing those challenges will require a more subtle approach than just attaching more renewables to the grid.
An analysis by Bloomberg New Energy Finance, narrowly distributed two weeks ago, estimated that nuclear reactors that produce 56 percent of the country’s nuclear power would be unprofitable over the next three years. If those were to go under and be replaced with gas-fired generators, an additional 200 million tons of carbon dioxide would be spewed into the atmosphere every year.
The economics of nuclear energy are mostly to blame. It just cannot compete with cheap natural gas. Most reactors in the country are losing between $5 and $15 per megawatt-hour, according to the analysis.
Nuclear energy’s fate is not being dictated solely by markets, though. Policy makers focused on pushing renewable sources of energy above all else — heavily subsidizing solar and wind projects, and setting legal targets for power generation from renewables — are contributing actively to shut the industry down. Facing intense popular aversion, nuclear energy is being left to wither.
As Will Boisvert wrote in an analysis for Environmental Progress, an environmental organization that advocates nuclear energy, the industry’s woes “could be remedied by subsidies substantially smaller than those routinely given to renewables.” The federal production tax credit for wind farms, for instance, is worth $23 per megawatt-hour, which is more than the amount that nuclear generators would need to break even.
Nuclear generators’ troubles highlight the unintended consequences of brute force policies to push more and more renewable energy onto the grid. These policies do more than endanger the nuclear industry. They could set back the entire effort against climate change.
California, where generators are expected to get half of their electricity from renewables by 2030, offers a pretty good illustration of the problem. It’s called the “duck curve.” It shows what adding renewables to the electric grid does to the demand for other sources of power, and it does look like a duck.
As more and more solar capacity is fed onto the grid, it will displace alternatives. An extra watt from the sun costs nothing. But the sun doesn’t shine equally at all times. Around noon, when it is blazing, there will be little need for energy from nuclear reactors, or even from gas or coal. At 7 p.m., when people get home from work and turn on their appliances, the sun will no longer be so hot. Ramping up alternative sources then will be indispensable.
The problem is that nuclear reactors, and even gas- and coal-fired generators, can’t switch themselves on and off on a dime. So what happens is that around the middle of the day those generators have to pay the grid to take their power. Unsurprisingly, this erodes nukes’ profitability. It might even nudge them out of the system altogether.
How does a renewables strategy play out in the future? Getting more power from renewables at 7 p.m. will mean building excess capacity at noon. Indeed, getting all power from renewables will require building capacity equal to several times the demand during the middle of the day and keeping it turned off much of the time.
Daily fluctuations are not the end of it. Wind power and sunlight change with the seasons, too. What’s more, climate change will probably change their power and seasonality in unforeseen ways. Considering how expensive wind and sun farms can be, it might make sense to reconsider a strategy that dashes a zero-carbon energy source that could stay on all the time.
A report published last month by the White House’s Council of Economic Advisers suggests there is space for more renewable energy on the grid. New technologies — to store power when the sun is hot or to share it across wider areas — might allow for a bigger renewable footprint.
But there are limits. “There is a very real integration cost from renewables,” said Kenneth Gillingham, an economist at Yale who wrote the report. “So far that cost is small.”
In Germany, where renewables have mostly replaced nuclear power, carbon emissions are rising, even as Germans pay the most expensive electricity rates in Europe. In South Australia, the all-wind strategy is taking its toll. And in California, the costs of renewables are also apparent.
Nuclear energy’s fate is not quite sealed. In New York, fears that the impending shutdown of three upstate reactors would imperil climate change mitigation persuaded Gov. Andrew Cuomo’s office to extend subsidies comparable to those given to renewables, to keep them afloat. Even in California, where nuclear energy has no friends, Diablo Canyon, the last remaining nuclear plant, is expected to stay open for almost another decade.
Still, both New York and California expect to eventually phase out nuclear power entirely. An analysis by Bloomberg puts the cost of replacing Diablo Canyon’s zero-carbon power with solar energy at $15 billion. This sum might be better spent replacing coal.
Displacing nuclear energy clearly makes the battle against climate change more difficult. But that is not what is most worrying. What if the world eventually discovers that renewables can’t do the job alone? “I worry about lock-in,” Ms. Mazurek said. “If it doesn’t work, the climate doesn’t have time for a do-over.”
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Referred to in a previous post, here is a picture of the Duck Chart showing energy production needs at different hours of the day. We made this giant investment in renewable energy via government subsidy, not economics or environmental forethought. Once in place, renewables have two main characteristics, they are greatly variable in output depending on weather, time of day, time of year, and they have a nearly zero variable cost, skewing the demand for other sources. That leaves us with the challenge of filling the large gaps with coal, gas and nuclear on a super large scale, but they don't switch on and off quickly and easily when the sun goes behind a cloud or the wind stills on a hot, air conditioned afternoon.
(http://i603.photobucket.com/albums/tt114/dougmacg/2d87f8bb-da85-4260-b6ca-fb6fe7f5a59e_zpstvi4lt8p.jpg)
Natural gas is now cheaper than nuclear and more able to scale up and down to meet the extreme variations in the new grid demand curve. Putting carbon-free nuclear out of business makes the whole renewable boondoggle a giant step backwards for the environment by all measures.
Who knew?
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http://www.breitbart.com/london/2016/09/30/coming-town-near-great-green-energy-disaster/
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http://www.nationalreview.com/article/440752/saudi-arabia-oil-fracking?utm_campaign=trueAnthem%3A+Trending+Content&utm_content=57fab2a204d3015055d9ff2a&utm_medium=trueAnthem&utm_source=facebook
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For environmental reasons, I confess that arctic drilling makes me very uneasy. It is a formidably dangerous environment and sooner or later Murphy will come to visit and stopping a leak under those conditions (look at how hard it was to stop things in the Gulf of Mexico) could have devastating consequences for one of the few remaining relatively pristine environments on the planet.
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A Trump U.S. Energy Boom
The next President can open Arctic and Atlantic drilling that Obama has shut down.
ENLARGE
Photo: Getty Images
Updated Nov. 26, 2016 2:45 p.m. ET
96 COMMENTS
Donald Trump this week released a video detailing the plans for his Administration’s first 100 days, and one bright spot is his agenda for American energy. The President-elect promised to peel away government obstacles, and he will have plenty of work after President Obama’s eight-year regulatory onslaught.
“I will cancel job-killing restrictions on the production of American energy, including shale energy and clean coal, creating many millions of high-paying jobs,” Mr. Trump said in his two-minute clip. “That’s what we want, that’s what we’ve been waiting for.”
Here’s one place to look: Last week the Obama Administration finished a five-year plan for offshore drilling contracts and canceled planned leases in the Arctic through 2022. That retreat is a reaction to protests from environmental groups, which melted down after a March Bureau of Ocean Energy Management draft included a sliver of drilling in the frozen North.
Leases off the Atlantic Coast were already excluded, and green groups hope Mr. Obama will make these diktats permanent under an arcane clause of the Outer Continental Shelf Lands Act. But that executive overreach is unlikely to stand up in court.
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Mr. Obama says there’s no reason to drill in the Arctic because oil prices are so low, as if the government can predict energy prices five or 10 years from now. The Arctic region is thought to hold 90 billion barrels of oil, and up to 30% of the world’s untapped natural gas. Exploration and drilling would create thousands of jobs, and most resources lie in relatively shallow waters fewer than 100 meters deep.
Regulation is already crushing: A report last year by the National Petroleum Council noted that a company needs permits from some 12 federal and state agencies merely to dig an exploration well in the Arctic. Recall that Shell spent seven years and $7 billion trying to exploit leases it had already paid for off Alaska’s Arctic coast before giving up. Russia is already exploring in the Arctic and won’t be deterred by American moralizing.
The Trump Administration may be tempted to cancel the Obama plan, but that would blow up leases in the Gulf of Mexico and Alaska’s Cook Inlet included in the outline. This means the new Administration would have to put out a new plan, say, for 2019 through 2024, that would supersede earlier orders. That will probably take at minimum 18 months, though both the Atlantic and Arctic regions have recently undergone environmental-impact evaluations, which should expedite the process.
The Obama Administration intends to make these drilling regulations as calcified as possible, and the Arctic is the tip of the iceberg. But more than 85% of area offshore controlled by the federal government is closed to exploration. Mr. Trump can unlock this potential, which would be a gusher for global consumers and American economic growth.
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"For environmental reasons, I confess that arctic drilling makes me very uneasy. It is a formidably dangerous environment and sooner or later Murphy will come to visit and stopping a leak under those conditions (look at how hard it was to stop things in the Gulf of Mexico) could have devastating consequences for one of the few remaining relatively pristine environments on the planet."
And what's more is why is it necessary to drill under the arctic ocean. With fracking now and the ocean of oil in the sands of Canada?
While the latter is expensive I wouldn't think it would be much more than drilling under a freezing ocean.
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How to keep an 80 million degree celsius device cool:
http://www.space.com/34960-star-in-a-jar-fusion-reactor-works.html
8-)
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By Russell Gold and
Cassandra Sweet
Updated Jan. 9, 2017 11:28 a.m. ET
157 COMMENTS
Utilities are closing U.S. nuclear-power plants at a rapid clip as they face competition from cheaper sources of electricity and political pressure from critics.
New York’s Indian Point plant about 35 miles north of Manhattan, a major source of power for the city and its surrounding suburbs, is the latest casualty. Owner Entergy Corp. said Monday that it will close the facility as part of an agreement with the state of New York, whose governor, Andrew Cuomo, has long criticized the plant as a safety threat.
Its closure would bring the tally of plants set to close by 2025 to four, including PG&E Corp.’s Diablo Canyon plant in California and Entergy’s Palisades unit in Michigan. Four others have already closed in the past four years, including Dominion Resources Inc.’s Kewaunee plant in Wisconsin.
The retirements are poised to leave 61 nuclear plants in the U.S. by the middle of the next decade. That includes two facilities that are building new reactors. A small number of nuclear plants have closed in the past because of safety concerns or the need for expensive repairs. What’s new is the number of plants closing that are licensed and operational, but no longer profitable in competitive markets.
Nuclear plants everywhere are facing a powerful economic foe: fracking. The extraction technique has unlocked vast amounts of natural gas, making generating electricity from that fuel much less expensive and lowering power prices across the U.S.
Entergy cited competition from natural gas as a key factor in the closure of Indian Point on Monday, disclosing that it will recognize a $2.4 billion pretax impairment charge in connection with the closure of the plant’s remaining units.
“Record low gas prices, due primarily to supply from the Marcellus Shale formation, have driven down power prices by about 45%, or by about $36 per megawatt-hour, over the last 10 years, to a record low,” said Bill Mohl, president of Entergy Wholesale Commodities. That reduced annual revenues by about $160 million for power plants such as Indian Point, he added.
Despite making the decision to close the facility, Mr. Mohl worried that if the country loses too many nuclear plants, the result could be relying too much on natural gas. “We know that with natural gas, at some point, there will be price movements,” he said.
Nuclear plants generated 20% of U.S. power in the past 12 months, following natural gas at 35% and coal at 30%, according to federal energy data. The remaining balance was 7% hydro, 6% wind and 1% solar.
The increasingly poor economics of nuclear power have led nuclear-plant operators in New York, Illinois and elsewhere to seek new state subsidies to keep the plants operating. The owners argue that they create high-paying jobs in rural areas, and are critical tools to combat air pollution and climate change because they produce emissions-free electricity.
Lawmakers in Connecticut, Ohio and Pennsylvania are expected to face tough choices in the next couple of years: Approve rate increases or other changes to bolster the finances of nuclear plants, or prepare for them to close.
Exelon Corp., the largest U.S. nuclear-power-plant operator, has succeeded in persuading states to provide new financial incentives to keep its nuclear-power plants open.
Last month, Illinois lawmakers voted to allow Exelon to collect as much as $235 million annually from customers in exchange for keeping two nuclear-power plants open. Earlier in 2016, the New York Public Service Commission agreed to pay as much as $480 million annually to keep three upstate nuclear plants open. Exelon operates two of the three, and has a deal to purchase the third from Entergy, pending federal approval.
Joe Dominguez, Exelon’s executive vice president for public policy, said states were paying for clean electricity, similar to how the federal government subsidizes wind and solar energy. Nuclear power “is the cheapest and most reliable zero-carbon resource,” he said.
FirstEnergy Corp. said recently that it could close three plants in Ohio and Pennsylvania if it couldn’t arrange better compensation for the power they provide.
A FirstEnergy spokeswoman said the company had watched the Illinois legislation closely and hoped to negotiate something similar.
Kristine Hartman, who tracks energy laws for the National Conference of State Legislatures, said she expects Arizona, New Jersey and New Mexico to consider modifying laws that encourage wind and solar to include nuclear as a power source free of greenhouse-gas emissions.
Without more support, “you will continue to see plants that are challenged,” said Maria G. Korsnick, the president and chief executive of the Nuclear Energy Institute, an industry advocacy group.
An analysis by the U.S. Energy Information Administration found that when nuclear plants were closed, states raised their use of natural gas and coal to generate power.
Jessica Lovering, director of the energy program at the Breakthrough Institute, an environmental think tank, said a modern gas plant can have just a dozen employees, while nuclear plants need upward of 1,000.
But those large workforces are proving to be a political selling point as owners argue to state legislators that nuclear-power plants have great economic importance in rural areas. All five nuclear-power plants receiving new subsidies in Illinois and New York are located in rural areas.
Still, the deals have been controversial. “I am pronuclear power, but I am not pro-bailing nuclear out,” said Jeanne Ives, a Republican state representative from Wheaton, Ill.
In New York, the deal brokered by Mr. Cuomo, a Democrat, to keep three upstate nuclear-power plants alive has been met by protests against what activists claim is a nuclear tax.
The new subsidies have also riled up independent power producers, which claim that nuclear operators are being given an unfair advantage.
Dynegy Inc. and NRG Energy Inc., which operate coal- and natural-gas-fired power plants, are suing New York regulators to reverse their decision to provide what they estimate could be more than $7 billion in subsidies to nuclear plants.
Bob Flexon, chief executive of Houston-based Dynegy, said he hopes the Trump administration will set a national energy policy that allows for a level playing field. “Someone needs to let them know that you’re killing coal if you throw billion-dollar subsidies to nuclear,” Mr. Flexon said.
—Mike Vilensky contributed to this article.
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Is this trickery. Tax carbon then pay off families with dividends with chum change? I don't suppose our energy costs will not go up simply negating any benefit of the "dividend payment"
answer of course we will be taxed far more then anything they are going to give back meaning this is all a ruse to fool us into thinking this is a great bargain for us .
From Republicans no less. Reagan ones too. I find it hard to believe their former boss would have been for this.
http://www.salon.com/2017/02/13/republicans-winning-idea-less-carbon-in-the-atmosphere-more-equal-distribution-of-income_partner/
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If they would use the revenues to eliminate other taxes I would be for it.
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http://enewspaper.latimes.com/desktop/latimes/default.aspx?pubid=50435180-e58e-48b5-8e0c-236bf740270e
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http://www.treehugger.com/energy-policy/tesla-kills-duck-big-batteries.html
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http://dailycaller.com/2017/04/03/idahos-4-3-million-solar-road-generates-enough-power-to-run-one-microwave/
Idaho’s $4.3 Million Solar Road Generates Enough Power To Run ONE Microwave
Photo of Andrew Follett
ANDREW FOLLETT
Energy and Science Reporter
2:53 PM 04/03/2017
An expensive solar road project in Idaho can’t even power a microwave most days, according to the project’s energy data.
The Solar FREAKIN’ Roadways project generated an average of 0.62 kilowatt hours (kWh) of electricity per day since it began publicly posting power data in late March. To put that in perspective, the average microwave or blow drier consumes about 1 kWh per day.
On March 29th, the solar road panels generated 0.26 kWh, or less electricity than a single plasma television consumes. On March 31st, the panels generated 1.06 kWh, enough to barely power a single microwave. The panels have been under-performing their expectations due to design flaws, but even if they had worked perfectly they’d have only powered a single water fountain and the lights in a nearby restroom.
Solar FREAKIN’ Roadways has been in development for 6.5 years and received a total of $4.3 million in funding to generate 90 cents worth of electricity.
The project broke down in late March and had to be repaired, and screenshots taken that month show the roadway’s electrical box caught fire. Firefighters soon showed up to the scene, prompting the solar project’s official webcam to issue an update: “The Solar Roadways electrical system is currently undergoing maintenance. Please check back late next week.”
Follow Andrew on Twitter
Send tips to andrew@dailycallernewsfoundation.org.
Read more: http://dailycaller.com/2017/04/03/idahos-4-3-million-solar-road-generates-enough-power-to-run-one-microwave/
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1)
https://stream.org/doubt-scientific-consensus/
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2)
A ‘Red Team’ Exercise Would Strengthen Climate Science
Put the ‘consensus’ to a test, and improve public understanding, through an open, adversarial process.
Opinion Journal: The Climate Change Debates You Never Hear About
Former Energy Department Undersecretary Steven Koonin on scientific self-censorship. Photo: istock images
By Steven Koonin
April 20, 2017 6:49 p.m. ET
Tomorrow’s March for Science will draw many thousands in support of evidence-based policy making and against the politicization of science. A concrete step toward those worthy goals would be to convene a “Red Team/Blue Team” process for climate science, one of the most important and contentious issues of our age.
The national-security community pioneered the “Red Team” methodology to test assumptions and analyses, identify risks, and reduce—or at least understand—uncertainties. The process is now considered a best practice in high-consequence situations such as intelligence assessments, spacecraft design and major industrial operations. It is very different and more rigorous than traditional peer review, which is usually confidential and always adjudicated, rather than public and moderated.
The public is largely unaware of the intense debates within climate science. At a recent national laboratory meeting, I observed more than 100 active government and university researchers challenge one another as they strove to separate human impacts from the climate’s natural variability. At issue were not nuances but fundamental aspects of our understanding, such as the apparent—and unexpected—slowing of global sea-level rise over the past two decades.
Summaries of scientific assessments meant to inform decision makers, such as the United Nations’ Summary for Policymakers, largely fail to capture this vibrant and developing science. Consensus statements necessarily conceal judgment calls and debates and so feed the “settled,” “hoax” and “don’t know” memes that plague the political dialogue around climate change. We scientists must better portray not only our certainties but also our uncertainties, and even things we may never know. Not doing so is an advisory malpractice that usurps society’s right to make choices fully informed by risk, economics and values. Moving from oracular consensus statements to an open adversarial process would shine much-needed light on the scientific debates.
Given the importance of climate projections to policy, it is remarkable that they have not been subject to a Red Team exercise. Here’s how it might work: The focus would be a published scientific report meant to inform policy such as the U.N.’s Summary for Policymakers or the U.S. Government’s National Climate Assessment. A Red Team of scientists would write a critique of that document and a Blue Team would rebut that critique. Further exchanges of documents would ensue to the point of diminishing returns. A commission would coordinate and moderate the process and then hold hearings to highlight points of agreement and disagreement, as well as steps that might resolve the latter. The process would unfold in full public view: the initial report, the exchanged documents and the hearings.
A Red/Blue exercise would have many benefits. It would produce a traceable public record that would allow the public and decision makers a better understanding of certainties and uncertainties. It would more firmly establish points of agreement and identify urgent research needs. Most important, it would put science front and center in policy discussions, while publicly demonstrating scientific reasoning and argument. The inherent tension of a professional adversarial process would enhance public interest, offering many opportunities to show laymen how science actually works. (In 2014 I conducted a workshop along these lines for the American Physical Society.)
Congress or the executive branch should convene a climate science Red/Blue exercise as a step toward resolving, or at least illuminating, differing perceptions of climate science. While the Red and Blue Teams should be knowledgeable and avowedly opinionated scientists, the commission should have a balanced membership of prominent individuals with technical credentials, led by co-chairmen who are forceful, knowledgeable and independent of the climate-science community. The Rogers Commission for the Challenger disaster in 1986, the Energy Department’s Huizenga/Ramsey Review of Cold Fusion in 1989, and the National Bioethics Advisory Commission of the late 1990s are models for the kind of fact-based rigor and transparency needed.
The outcome of a Red/Blue exercise for climate science is not preordained, which makes such a process all the more valuable. It could reveal the current consensus as weaker than claimed. Alternatively, the consensus could emerge strengthened if Red Team criticisms were countered effectively. But whatever the outcome, we scientists would have better fulfilled our responsibilities to society, and climate policy discussions would be better informed. For those reasons, all who march to advocate policy making based upon transparent apolitical science should support a climate science Red Team exercise.
Mr. Koonin, a theoretical physicist, is director of the Center for Urban Science and Progress at New York University. He served as undersecretary of energy for science during President Obama’s first term.
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#1 really surprised me:
http://www.worldatlas.com/articles/the-world-s-largest-oil-reserves-by-country.html
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are not draconian or unreasonable:
http://www.heritage.org/energy-economics/commentary/climate-budget-cuts-are-smart-management-not-attack-science
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http://www.foxnews.com/us/2017/04/06/kentucky-coal-mining-museum-switches-to-solar-power.html
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When Bamster was Prez all we heard from GE was solar etc. Now Trump is Prez we see this:
http://www.newsmax.com/Companies/ge-baker-hughes-oilfield/2017/07/04/id/799733/
maybe they should just some out and admit the economics of alternative energy was a sham all along...........
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argued as a more palatable alternative to carbon tax. That said it is a watered down carbon tax if my opinion:
http://www.investopedia.com/terms/c/cap-and-trade.asp
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https://www.americanexperiment.org/2017/11/xcel-reveals-solar-garden-power-costs-double-sources/
Xcel Reveals Solar Garden Power Costs Double Other Sources
Written by Tom Steward Center for the American Experiment, in Environment, Energy on November 10, 2017
The Minneapolis City Council’s recent approval of two more community solar gardens led to glowing coverage in The Journal, a community newspaper. But the report also appears to contain a bombshell from an Xcel Energy executive about the true cost of solar power, a disclosure that solar costs Minnesota ratepayers tens of millions of dollars more than conventional electricity.
At face value, the new community solar deal “saves” Minneapolis $28,000 a year on electric bills, while helping Xcel Energy meet the state mandate to produce 1.5 percent of Minnesota’s electricity through solar.
Wasting 100 million dollars in a relatively small state, I wonder what the national total is.
Give to Center for the American Experiment: https://www.americanexperiment.org/donate/
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This article ends with "best bet to save the world", the author takes human caused climate change quite seriously. If you believe excessive carbon emissions are serious, and everyone should to some extent, then nuclear energy is the answer.
Read this at the source to get the links that back up the points made. I post the text here to capture it on the forum.
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https://grist.org/article/its-time-to-go-nuclear-in-the-fight-against-climate-change/
It’s time to go nuclear in the fight against climate change
By Eric Holthaus on Jan 12, 2018
After holding steady for the past three years, global carbon emissions rose in 2017 by an estimated 2 percent. That increase comes amid the largest renewable energy boom in world history.
That irony points to what I see as an inescapable conclusion: The world probably can’t solve climate change without nuclear power.
Something big has to change, and fast, in order to prevent us from going over the climate cliff. Increasingly, that something appears to be a shift in our attitudes toward nuclear energy.
By nearly all accounts, nuclear is the most rapidly scalable form of carbon-free power invented. And, the technology is rapidly improving. But lingering concerns about waste and safety have kept nuclear power from staying competitive.
Solar power has grown at a whopping 68 percent average rate over the past 10 years, but still accounts for less than 2 percent of total U.S. electricity generation. The 99 reactors in the U.S. generate about 10 times that amount. Roughly 30 nuclear facilities are set to retire in the next few years because those plants have become economically infeasible. (California regulators voted unanimously Thursday to shutter Diablo Canyon, the state’s last remaining plant, in 2025.) That’s despite these facilities producing more than double the amount of electricity than all the solar panels in the United States combined.
“In 2016, renewables received about 100 times more in federal subsidies than nuclear plants,” Michael Shellenberger, founder of the Berkeley, California-based, pro-nuclear advocacy group Environmental Progress, wrote in an email to Grist. “If nuclear received a fraction of those subsidies, there would be no risk of nuclear plants closing in California or anywhere else.”
Jesse Jenkins, a researcher at the Massachusetts Institute of Technology’s Center for Energy and Environmental Policy Research, reveals in a preliminary scientific paper — meaning it’s still awaiting peer review — that the rapid decline in the cost of natural gas has been the driving factor in undercutting the electricity market in the U.S. Midwest and Mid-Atlantic. Those regions are home to a majority of the nuclear reactors now expected to go offline.
The take home? The advent of fracking — in addition to being the fastest-growing source of emissions in the U.S. — is also cannibalizing what is currently our biggest source of carbon-free electricity.
A similar story is playing out in Germany. The country’s nuclear power plants have been shuttered with only part of the capacity replaced by wind and solar. Dirty coal has filled the gaps. So it’s no surprise, German electricity sector emissions are actually rising slightly — and the country’s leaders are now considering scrapping an ambitious climate goal for 2020.
Jenkins wrote on Twitter that Germany’s shift in energy policy was misguided and resulted effectively in fossil fuels replacing much of the missing nuclear power — a pattern that’s playing out at home, as well. To get to a cleaner energy mix faster, you’d want to nix coal before nuclear.
Even if you believe 100% renewable energy is the end goal, if you think climate change is really an urgent existential threat, the order of operations is clearly phase our coal, then gas, then nuclear. Germany is doing opposite.
For once-and-future climate leaders like Germany and the United States to turn their backs on one of the best tools we have for rapidly decarbonizing the global economy is a short-sighted decision of international and multi-generational consequence. It’s also a climate story few people are talking about.
Historically, nuclear power has been the fastest way to decarbonize the global economy, Shellenberger argues, and it can be again. New reactor designs offer a generational leap in terms of cost and safety, but proponents have so far struggled to secure the billions of dollars in funding that renewables are getting.
Big name climate experts, like former NASA scientists James Hansen agree that a bias against nuclear is holding it back. He and Shellenberger see support for the industry as a tactic for attracting the Trump Administration’s attention on climate policy. (In September, the Trump administration made a conditional loan to help finish the construction of a languishing nuclear power project in Georgia.)
The sheer urgency of climate change demands an all-of-the-above approach to making carbon-free energy.
“If we discovered nuclear power today, we would be working like mad to make it as safe and cheap as possible,” Stanford University climate scientist Ken Caldeira tweeted last summer.
But resistance by mainstream environmental organizations has helped stymie that progress. And the most ardent supporter of climate change legislation in last year’s presidential election, Bernie Sanders, ran on an anti-nuclear platform. (In December, Shellenberger announced he is running for California governor as an explicitly pro-environment, pro-nuclear independent.)
The more the world feels the powerful effects of climate change and the longer we wait to reduce emissions the more attractive nuclear energy could become. On our current track, scientists are increasingly alarmed that multiple simultaneous weather and environmental disasters — like last year’s horrific hurricanes and wildfires — could ultimately bend society to the breaking point in our lifetimes.
If we were smart, we’d see nuclear power for what it is: A good bet to save the world.
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If only colleges would spend half the time figuring out how to lower their costs rather then dreaming big government agendas designed to soak more workers:
https://www.wired.com/story/thank-colleges-for-imminent-carbon-taxes-no-seriously-thank-them/
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If only colleges would spend half the time figuring out how to lower their costs rather then dreaming big government agendas designed to soak more workers:
https://www.wired.com/story/thank-colleges-for-imminent-carbon-taxes-no-seriously-thank-them/
One problem with the carbon tax is that it is measured politically, not scientifically or mathematically. So for one thing, solve that first.
"One degree Celsius" [adjusted data] is the entire warming since the start of the industrial age and we could be near the end of heavy carbon use. [Do any of these people favor carbon-free nuclear?] This tiny, unmeasurable warming arguably saved lives and we know for certain that plants grow better. The cost of this is ...
When conservatives support carbon tax, Ryan for example, they are supporting an imaginary revenue-neutral version that is not possible in our political world. When you introduce a new tax like the Carbon tax or the "Fair" tax, the old taxes don't go away and also don't really go down in the long run even if it says they do in the original legislation.
If or when we prefer other taxes to an income-based tax system, repeal the 16th. It's that simple. Or cap the promised rates in the constitution.
Propose and ratify percentage caps on spending and taxes right into the constitution. For example, no federal spending budget above 20% of last year's actual GDP and no federal taxation on any legal economic activity above a 25% rate. 2/3 super-majority approval in both chambers required to go above caps, to deal with national emergencies.
Within a framework limit written into the constitution I could see playing around with new or creative sources of revenue. But if you want to grow government, grow the economy first, not the government's share of the economy. We don't fix the climate or raise our standard of living by making government bigger.
Find a real pollutant to test the best way to tax pollution.
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Do you want the power to go on and off with weather? Eliminate thermal sources and the grid goes down during storms and during peak usage.
http://www.powerlineblog.com/archives/2018/04/which-energy-sources-are-actually-sustainable.php
https://www.americanexperiment.org/green-energy-fails/
During the harsh storm of December 27, 2017, to January 8, 2018...
Failure was prevented by coal-fired power plants increasing electrical generation by 63%, natural gas plants by 20%, nuclear by 5.3% and seldom used oil by 26% over planned generation.
-------------------------------
Both solar and wind fail during certain peak usage times. Energy needs to be "dispatchable".
Nuclear is the cleanest, steady source of energy. Fossil fuels are [still] the most dispatchable, can be dispatched when and where needed. Wind and solar have natural and technical ups and downs that don't coincide with demand.
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https://www.americanexperiment.org/green-energy-fails/
The only thing we gained is higher electricity costs.
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Zero gain after 6% solar on grid.
http://www.powerlineblog.com/archives/2018/06/the-trouble-with-solar-energy.php
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https://www.youtube.com/watch?time_continue=3&v=shq06IW2wwg
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https://www.youtube.com/watch?time_continue=3&v=shq06IW2wwg
From the point of view of nuclear, fossil fuels or hydro power needed to power the grid around the clock, solar is the co-worker "who arrives late, does work that others could easily do, harms others’ productivity, and then skips out when they’re most needed"?
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https://www.investors.com/politics/editorials/u-s-co2-levels-drop-again/
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https://www.investors.com/politics/editorials/u-s-co2-levels-drop-again/
A source link for the above: https://www.eia.gov/totalenergy/data/monthly/
Credit fracking. Natural gas is far cleaner than coal. Nuclear energy is cleaner than both. Solar and wind are distractions in terms of major energy sources. Hopefully we re-build nuclear infrastructure and see CO2 emissions plummet further.
The Paris Accord and government planners didn't have the solution. The Obama administration opposed fracking right while it grew in the states, cutting our emissions and defunding the oil tyrants around the world.
Keep going with fracking, build nuclear capacity and free people will switch to clean and efficient, plug in, natural gas hybrids with no mandate required.
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Putting this in two threads:
https://dogbrothers.com/phpBB2/index.php?topic=1098.msg103441#msg103441
Part 1: Shale crushes Solar, https://www.realclearenergy.org/articles/2017/04/26/energy_revolutions_hidden_in_plain_sight_part_1_of_3_--_shale_crushes_solar_110215.html
Part 2: The Cloud crushes Electric Cars
https://www.realclearenergy.org/articles/2017/05/03/energy_revolutions_hidden_in_plain_sight_part_2_of_3_demand__the_cloud_crushes_electric_cars_110219.html
Part 3: Policy
energy_revolutions_hidden_in_plain_sight_part_3_of_3_policy__110221
"government programs were not responsible for either the supply or demand revolutions"
"Last year solar panels supplied 0.3% of America’s energy; wind turbines supplied 2%... Most people think those sources make a 10-fold greater contribution."
"40% of America’s corn harvest is now turned into fuel—ethanol today displaces less than 4% of U.S. transportation fuel....100% of the nation’s crop would have de minimis relevance."
"powering an entire economy is not like putting a few men on the moon. It’s like putting everybody on earth on the moon—permanently. "
"the radical cost improvements in solar and wind are over." "the radical cost improvements in solar and wind are over. [Batteries too.]" The improvement rate with shale is much greater: "Shale productivity has been improving by an average of at least 20% a year over the past half-dozen years. Output per rig is doubling every three years."
"To find energy revolutions we will need to make new discoveries in the underlying physical sciences. That can only emerge from basic research, not from subsidizing more of yesterdays’ technologies. Put another way: The Internet didn’t emerge by subsidizing the dial-up phone; nor was the transistor inspired by subsidizing vacuum tubes, nor the automobile inspired by railroad subsidies."
"The world’s nearly 8 billion people and $80 trillion economy depend on hydrocarbons to supply 85% of global energy; oil itself fuels 98% of transportation. Only radically new science has any prospect for meaningfully changing those realities."
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I can't decode the politics here. Colorado has gone full Democrat lately, flipping the Congressional delegation from 3-4 to 4-3 Dem and electing a gay, left wing Governor from Boulder. The reason for the flip is that the new voters moved their politics in from elsewhere. But they voted down the proposal to increase 5-fold the required setback for fracking from houses, businesses, schools.
The truth in fracking is counter-intuitive. This particular development of fossil fuels actually makes CO2 emissions decline and causes cleaner air because fracking enables the US to move a bit from coal to the far cleaner natural gas. The front range has a long history of air quality issues.
I can't imagine the new liberal governor sided with the gas and oil business so people must have split their ticket between supporting this controversial economic sector and their left wing death wish to destroy the economy. Colorado's real estate boom has peaked and the last thing they needed was the Prop 112 nail in the economic coffin. Can anyone add local flavor or another view to the politics of this?
https://www.denverpost.com/2018/11/06/colorado-proposition-112-results/
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Colorado has gone full Democrat lately
isn't this all due to immigrants ?
the Right should have stopped this 30 yrs ago when Reagan who I love granted amnesty.
What were they thinking ? that all these immigrants would be so thankful they will start voting for Republicans.
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Again I draw attention to the role of natural gas in geopolitics:
==============================================
U.S. LNG Exports Are About to Reshape the Global Market
Storage tanks for liquefied natural gas sit in a large oil-refinery plant
(COR LAFFRA/Shutterstock)
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Highlights
By the end of 2019, the United States will become one of the world's three largest exporters of liquefied natural gas.
Qatar, which has been the globe's biggest LNG producer until now, will begin implementing a more aggressive strategy next year in the face of competition from the United States and Australia.
U.S. trading partners could promise to purchase American LNG as a way to reduce their trade surpluses.
China is unlikely to purchase LNG from the United States because of their trade war, choosing instead to buy Russian gas from Siberia.
The United States will ramp up its pressure on the European Union to buy more U.S. LNG and to improve its infrastructure so it can reduce the bloc's reliance on Russian energy.
Editor's Note: This assessment is part of a series of analyses supporting Stratfor's upcoming 2019 Annual Forecast. These assessments are designed to provide more context and in-depth analysis on key developments in the coming year.
The U.S. shale revolution has had a major impact at home, but its echoes have reverberated less elsewhere around the world, at least where natural gas is concerned. That, however, is about to change. By the end of 2018, the United States will launch nine liquefied natural gas export projects that will have a collective liquefaction capacity of 36.7 million tonnes per annum (mtpa). The expansion will boost the country's capacity to roughly 63 mtpa — a big step up from the mere 1.5 mtpa that existed before 2016.
It all adds up to a big year in 2019. And growth in U.S. LNG exports will continue beyond that because more processing and liquefaction facilities are expected to come online the following year. Producers are also considering additional final investment decisions to construct new facilities beyond that. The consequences of rising U.S. — as well as Australian — LNG exports have already begun to make waves throughout the market, meaning the geopolitical battle over LNG will be front and center next year, particularly among four countries: Qatar, China, Russia and the United States.
The Big Picture
While the U.S. shale revolution has had a major impact on global oil markets, its effects on global natural gas markets have been more muted. In 2019, however, the United States will finally reap the rewards of its investments in liquefied natural gas when gas exports are expected to increase significantly and have global ramifications.
See The Future of Energy
Qatar: Protecting Itself from the World
The United States and Australia are likely to be joined by others as countries around the world look for an increase in global natural gas demand in the 2020s. Last month, Royal Dutch/Shell and its partners made a final investment decision on its large LNG Canada project, which was its first such decision on a such a project in more than five years.
For years, Qatar has been the globe's LNG export leader. In 1997, the tiny Gulf state exported no LNG, but by 2011, it led the world, with an installed capacity of 77 mtpa. But in 2005, Doha implemented a moratorium on developing new parts of the North Field, the world's largest gas supply, due to concerns about oversupply and overproduction.
But increasing pressure from Australia (in parallel with U.S. growth, the country also hiked its LNG capacity by 62.3 mtpa from 2015 to 2018), the United States and elsewhere forced Doha to announce in April 2017 that it would lift that moratorium in an effort to boost its export capacity from 77 to 100 mtpa. But just two months later, three of Qatar's neighbors — Saudi Arabia, the United Arab Emirates and Bahrain — imposed an economic blockade in anger over its independent streak in foreign policy. That diplomatic course was made possible by Doha's windfall from LNG, which gave it the economic freedom to politically distance itself from its neighbors, especially Riyadh.
Since 2017, pressure from its global LNG competitors and local political rivals has prompted Doha to become more aggressive in the energy sector and enact reforms to make it more nimble. Qatar's problem has never been that its LNG exports and natural gas developments are expensive; by contrast, production is relatively easy in the North Field. But Doha must take advantage of its comparatively cheap production costs to entice international oil and gas companies to invest in Qatar instead of more expensive markets, even if the latter includes more politically stable countries such as Australia and the United States. And in order to meet its new export growth targets, Qatar must find new destinations — and the conclusion of a number of long-term LNG contracts in the first half of the 2020s will compound its task.
Charts show the natural gas liquefaction capacity of the United States, Qatar and Australia.
The U.S. emergence has also kick-started a gradual shift in Asian LNG markets, as well as a more rapid trend toward short-term contracts and gas-on-gas pricing, in which contracts are based on spot natural gas prices, instead of traditional oil prices. This has forced Qatar to explore ways to reorganize its energy sector to compete. The all-important Qatar Petroleum merged its two natural gas companies — Qatargas and RasGas — earlier this year. And after a Cabinet reshuffling on Nov. 3, Qatar Petroleum CEO Saad al-Kaabi became the country's new energy minister and will oversee some of the changes he's been pushing. At the same time, Sheikh Abdullah bin Hamad al-Thani, the brother of Emir Tamim bin Hamad al-Thani, has also become the new chair of Qatar Petroleum.
The World: Protecting Itself from Trump
One fly in the ointment for the U.S. LNG industry is the country's new trade wars. Before making final investment decisions on LNG export facilities — which can cost more than $10 billion and as much as $50 billion to $60 billion, in extreme cases — investors want a degree of certainty about long-term contract and destination opportunities. Washington's trade war with Beijing has made this more difficult, especially for LNG exporters, because China is the world's second largest LNG importer (trailing only Japan) and will be the major driver of LNG import growth over the next five to 10 years.
China imposed a 10 percent tariff on U.S. LNG in September after the United States slapped tariffs on $200 billion worth of imports on Chinese goods. And with the United States promising to levy tariffs on more goods, investors are growing skittish over how long the tariffs might remain in place; indeed, there is no guarantee that the United States and China will ever actually remove them. The uncertainty has already resulted in some delays to final investment decisions on U.S. LNG projects. On Oct. 29, LNG Ltd. announced that it would delay its decision on the Magnolia LNG export terminal in Louisiana until 2019 because of the trade spat, even though it had originally aimed to settle the matter by the end of this year. In the short term in 2019, China can easily ignore the U.S. LNG market because Russia is preparing to pump more natural gas to Asia through the new Power of Siberia pipeline. In the long term, China may need to turn to Qatar, or to more Russian natural gas, in order to avoid U.S. LNG exports.
Avoiding U.S. LNG, however, might not be so easy. As the United States embroils itself in trade wars, other countries are considering the purchase of more U.S. LNG as a means of appeasing U.S. President Donald Trump in their trade discussions. After all, given that 2019 is expected to be a bumper year for U.S. LNG, importing more of the resource from the United States offers the country's trading partners a quick, obvious and tangible way of reducing their trade surpluses. More than that, U.S. LNG represents a potential investment opportunity that could placate the United States. South Korea, Japan and even China — all countries that must import LNG — were mulling investments in the U.S. LNG industry even before experiencing pressure from the White House.
Avoiding U.S. LNG might not be easy. As the United States embroils itself in trade wars, other countries are considering purchasing more U.S. LNG as a way of appeasing President Donald Trump.
The U.S.: Protecting Europe from Russia
U.S. preparations to export large amounts of LNG will ratchet up the pressure on Russian natural gas exports — as well as Moscow's customers — in Europe. The United States views Europe's dependence on Russian natural gas as a strategic risk in Washington's global power competition with Moscow. As a result, the United States will turn up the pressure on European customers next year to purchase what it views as a politically safer alternative to Russian natural gas: American natural gas.
An abrupt switch to U.S. natural gas might not be a realistic option for many European countries, yet the Trump administration is still likely to press the argument, especially in two areas: Eastern Europe and Germany, which is Russia's largest European customer. The United States, along with Poland and other Eastern European countries, opposes the Nord Stream 2 natural gas pipeline, which is under construction. To the United States, the pipeline, along with a similar pipeline through Southern Europe called TurkStream, is a clear indication of Europe's increased reliance on Russian gas. Instead, Washington will pressure Berlin to build more LNG terminals. Amid the pressure, Germany has been playing both sides, launching construction on Nord Stream 2 earlier this year while also pledging financial support to domestic LNG import facilities.
2019 will also be crucial in the natural gas disputes surrounding Ukraine. For the United States, Nord Stream 2 will not only increase Berlin's dependence on Russian energy but also imperil Kiev, since Russia will be freer to turn off the tap to Ukraine for political reasons if there are no downstream markets in Central Europe that would otherwise suffer from a shut-off. Russia's Gazprom has argued that Nord Stream 2 makes more economic sense than rehabilitating the pipelines that traverse Ukraine due to the cost of modernizing Soviet-era pipelines. Moreover, Gazprom has noted that most of Russia's new natural gas developments are in the Arctic, which would put them closer to a pipeline in the Baltic Sea. Until this year, Germany had viewed the Nord Stream 2 pipeline in purely economic terms. Over the course of 2018, it has begun grappling with the political ramifications of the project, and Washington is certain to increase the political heat on Berlin over the project in 2019.
From competing with Russia in Europe and Qatar elsewhere to becoming a bone of contention in trade wars with China — as well as a few American allies — U.S. LNG exports are about to finally make their big splash on the global stage, more than five years after discussion first began about the impact that the U.S. resource would have on geopolitics. The U.S. shale gas revolution might have been slow in coming, but its impact might well shake the world in the year to come.
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second post:
PS: Remember this?
https://www.investors.com/politics/editorials/u-s-co2-levels-drop-again/
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https://endocrinedisruption.org/audio-and-video/oil-and-gas-basics
Dig into the O and G literature and science here: https://endocrinedisruption.org
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second post:
PS: Remember this?
https://www.investors.com/politics/editorials/u-s-co2-levels-drop-again/
Yes. Fracking success is the largest force currently bringing down CO2 emissions. Not intermittent sources like wind and solar which without fracking require coal to fill in the rest of the demand over the clock and the calendar.
Pounds of CO2 emitted per million British thermal units (Btu) of energy for various fuels:
Coal (anthracite) 228.6
Coal (bituminous) 205.7
Coal (lignite) 215.4
Coal (subbituminous) 214.3
Diesel fuel and heating oil 161.3
Gasoline (without ethanol) 157.2
Propane 139.0
Natural gas 117.0
https://www.eia.gov/tools/faqs/faq.php?id=73&t=11
Nuclear: 0.00
We must act fast, atmospheric CO2 levels are already at zero parts per thousand.
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What about the endocrine disruption?
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"What about the endocrine disruption?"
I didn't realize what I wrote below hadn't posted yet. In short, they don't seem to be alleging that any of this has happened.
https://endocrinedisruption.org/audio-and-video/oil-and-gas-basics
Dig into the O and G literature and science here: https://endocrinedisruption.org
May I ask, what is the point or conclusion of the person referring this information?
There is no doubt that poisons in the human body at unacceptable levels are harmful to glands and hormones.
Is there evidence this is happening? What levels cause health damage? What levels are they finding? How much of these chemicals is fracking emitting into human contact? How does that compare with other risks?
The "peer-reviewed" articles I checked do not ask or answer the most basic questions such as, compared to what? Is fracking more harmful than the coal it replaces? Are the risk of spills and leakage worse than nuclear? Or are they comparing this risk to an imaginary economy that runs on no energy at all? What industry doesn't have risk? The studies talk about "risk" and "controversy" and I get that; we prefer no risk and no controversy. Pollution implied needs to be measured and illnesses and deaths need to be counted. The coal industry it replaces has deaths: https://www.cbsnews.com/news/coal-mine-deaths-surge-putting-feds-and-miners-at-odds/
From the website cited:
"HOW CAN WATER BE CONTAMINATED?
Groundwater can be contaminated by gas migrating from faulty well casing and cementing. Contamination of shallow aquifers and surface water has been linked to spills and leaks of fracking fluids and wastewater on the well pad."
Keywords: faults, leaks and spills, by implication they are saying that when things are working properly there are no emissions. I think that's a big deal. It's a VERY CLEAN source of energy even though I heard anecdotal evidence of a valve leak in North Dakota that was cleaned up quickly when discovered.
How often is this happening and how much is escaping the cleanup? Can these leaks and spills be mostly stopped and avoided. I think they already are. In the case of the small North Dakota valve leak, it was either equipment or human error and hopefully learning takes place and corrections are made that make it safer everywhere going forward.
Does a total ban on fracking put the population at less risk? Not if you believe the climate change threat and know that fracking is the biggest development yet to curtail CO2 emissions. What if all the world replaced all coal use with natural gas and cut the CO2 emissions in half? Right now. That is a big deal in climate and CO2 strategy. I am pro-nuclear; why not cut most of that use to zero?
Colorado voters just voted on this exact issue and voted new restrictions down. I would say Colo is one of the most environmentally conscious states anywhere. Environmentally strong candidates (Democrats) won everything statewide while this measure failed. I know the oil and gas industry spent more but the opponents of fracking did not make the case.
Dem Gov Hickenlooper under oath in congressional testimony: "I drank the fracking fluid." https://www.youtube.com/watch?v=eyPUjXm4iBo
Done right, fracking has no drinking water contamination:
https://www.youtube.com/watch?v=VY34PQUiwOQ
This is a highly regulated, highly engineered industry. They aren't just spraying chemicals around (like agriculture, homeowners and golf courses do).
Coal usage emits sulfur dioxide. Old nuclear plants are vulnerable to tsunamis and earthquake faults. Wind turbines chops up birds and solar energy electrocutes careless homeowners and workers. https://www.osha.gov/dep/greenjobs/solar.html Which source has less risk, is safer and cleaner than fracking? Perhaps nuclear but I think we need both.
If the risks are substantial, too bad the whole concept of "peer reviewed studies" lost credibility in the climate debacle. cf. Hide the decline, adjusted data, etc. Did you see some of the spoof studies that passed peer review lately? One side in energy versus health and safety debates makes the accusation that all energy industry funded studies are bunk and vice versa, the anti-energy industry is also large and full of its own money incentives.
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Thank you for the serious and thoughtful reply.
I find that of late I have been thinking about the implications of endocrine disruption.
We mentioned it here on the SC&H forum a few years back but speaking for myself I hesitated from following through on the implications for fear of looking deranged-- but with Tucker Carlson making the point on his TV show and in his book (e.g. that under 40 male testosterone has declined 30% in the last 30 years) I have been inspired to find my courage to pursue the point.
I wonder how much of our current political decline is attributable to this? (feminism, hermaphroditism, RINO Reps, declining birth rates, etc)
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"under 40 male testosterone has declined 30% in the last 30 years"
Extremely alarming if true and nationwide or worldwide, could literally lead to extinction in a short time at that rate. If true, it appears we are chasing mostly the wrong shiny objects.
Does not sound like it correlates with fracking with less than a 10 year history, regionally isolated, mostly unpopulated areas and almost no incidence of leakage into drinking water.
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http://dogbrothers.com/phpBB2/index.php?topic=1029.msg113667#msg113667
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"I remember when The Smartest President Ever told us that we couldn’t drill our way out of depending on our enemies for energy."
- Glenn Reynolds at instapundit commenting on the new strength of the US to enforce sanctions on oil producers like Iran and Russia.
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In Oil’s Huge Drop, All Signs Say Made in the U.S.A.
Rising U.S. production and inventory, changing policies and a stronger dollar add to pressure on price of crude
Drilling site in the U.S.’s Permian Basin last March.
Drilling site in the U.S.’s Permian Basin last March. Photo: Daniel Acker/Bloomberg News
161 Comments
By Stephanie Yang and
Amrith Ramkumar
Nov. 23, 2018 3:03 p.m. ET
The downward spiral in oil prices is accelerating as a surge in crude production from a turbocharged U.S. petroleum industry runs into weaker global economic growth.
Crude prices slid 7.7% Friday, their largest one-day drop since July 2015, and are now down by nearly a third since the start of October. The U.S. benchmark, West Texas Intermediate futures, closed at $50.42 a barrel—its lowest level in over a year.
As economic growth outside the U.S. has flagged, producers and traders are beginning to worry that demand for crude will also decline. In export-dependent Germany, a purchasing managers index hit a four-year low, well below the level economists were expecting.The steepness of the drop has prompted Saudi Arabia and the Organization of the Petroleum Exporting Countries to consider a plan to quietly cut production to bolster prices, according to people familiar with the matter.
The idea would see the cartel retain the official output targets it set in 2016. But, because Saudi Arabia is overshooting those targets by nearly 1 million barrels a day, it would effectively be a cut. Such a move may help support prices without raising the ire of President Trump, who has been calling on OPEC to keep prices lower.
Investors remain skeptical that the OPEC meeting in Vienna on Dec. 6 will be able to turn the tide on oil supply enough to support prices.
A big reason why: the emergence of the U.S. oil industry as one of the world’s most important players. Ballooning shale production—American output has nearly doubled since the start of 2012—has made the U.S. a key supplier and exacerbated worries about a global glut of crude.
“I never thought I would hear these kinds of numbers coming out of the U.S.,” said Bob Yawger, director of the futures division at Mizuho Securities USA. “This is going to force OPEC’s hand.”
Power Play
The U.S. now exports more energy than it imports, by one measure.
U.S. energy trade balance, monthly
Natural gas
30 trillion British thermal units a day
Coal
Oil products
Total energy
trade balance
0
swung positive
in October
Crude oil
–30
–60
Negative figures
indicate imports
exceed exports
–90
’10
’15
’18
2006
Source: Bank of America Merrill Lynch
This summer, the U.S. surpassed Saudi Arabia and Russia as the largest crude-oil producer—a title it hadn’t held since 1973, according to the International Energy Agency. Monthly output in the U.S. was a record 11.65 million barrels a day in September and nearly the same amount in October, according to energy consulting firm Wood Mackenzie, while Saudi Arabia’s supply was nearly 11 million barrels a day last month and Russian production stood at 11.4 million a day.
“It used to be the world was divided into OPEC and non-OPEC,” said Daniel Yergin, vice chairman of IHS Markit, which projects the U.S. will be a net exporter of petroleum in the early 2020s. “Now it’s the world of the big three.”
On Top of the WorldSurging production has made the U.S. the world's largest oil supplier in recentmonths.Source: Wood MackenzieNote: Includes crude and condensate production
.million barrels a dayU.S.Russia
Saudi Arabia2015’16’17’189.09.510.010.511.011.512.0
In recent weeks, that has been reflected in a bumper amount of oil in storage. U.S. crude stockpiles have climbed for nine consecutive weeks. Inventories advanced by 4.9 million barrels in the week ended Nov. 16, and rose more than 10 million barrels the week before, the largest one-week increase since February 2017.
Bottlenecks in getting oil out of the prolific Permian basin in Texas have led to a big divergence in the benchmark prices of oil. The global benchmark, Brent crude, trades for roughly $9 more than West Texas Intermediate, which is harder to get to global markets.
However, the U.S. has continued to pump oil and many expect those hurdles to be cleared next year as new pipelines are built, unleashing even more crude on the rest of the world.
Uncertainty on the geopolitical front has also contributed to worries about oversupply.
Mr. Trump has signaled a willingness to look past the killing of a prominent U.S.-based journalist in his relations with Saudi Arabia. And the U.S., after months touting strict enforcement of sanctions on Iran, granted more generous waivers than expected for eight governments to buy Iranian oil. This could lead to higher-than-expected supply from the Islamic Republic.
One-Way StreetU.S. crude-oil futures have moved steadilylower in recent weeks after hitting theirhighest level since 2014.Source: SIXNote: Front-month contractAs of Nov. 23
.a barrel
Multiyear highJan. ’18AprilJulyOct.45505560657075$80
Saudi officials said Mr. Trump pressured their country into ramping up oil production to record levels ahead of the sanctions on Iran’s petroleum industry, the Journal has reported.
“They are trying to be as cooperative with us as possible,“ said Douglas Hepworth, chief operating officer at Gresham Investment Management LLC, a $7 billion commodities firm with about one-third of its assets in energy. “What triggered the whole thing was everybody in the world moving to full capacity to try and make the world safe for Iranian sanctions.”
The strength of global production now threatens to overwhelm demand. This could pressure OPEC and its allies such as Russia to cut back when the group meets next month in hopes of regaining more direct control of global supply.
Up, Up and AwayU.S. inventories have climbed steadily inrecent weeks with energy companiesboosting output.Weekly change in U.S. stockpilesSource: Energy Information Administration
.million barrels
Oct. ’18Nov.-50510
Such a combination helped rein in the last oil price rout two years ago—defying skeptics who previously warned OPEC’s grip on world markets had slipped thanks to U.S. shale. In 2016, the cartel teamed up with Russia and a group of like-minded, non-OPEC oil producers. They throttled back hard and stayed disciplined, slowly draining the world of the buildup of inventory that now is starting to slosh around the world again. The big question is whether they can pull off the same sort of deal now, and how long it might take to drain supply again.
Adding to the pressure on oil is a stronger U.S. dollar. Since crude is priced in dollars, it becomes more expensive for foreign buyers when the U.S. currency rises. On Nov. 12, the dollar jumped to its highest level since March 2017, bolstered by expectations of higher interest rates. This could start to hinder global demand, one of the initial drivers that underpinned the recovery in crude.
If the price of oil drops too far, too fast, that could also hurt U.S. producers, especially in the shale patch. Most shale drillers now maintain they can break even at $50 or lower. But the falling prices have begun to eat into their profitability, and some may be forced to curtail spending next year and reduce ambitious growth plans if prices decline much more.
Mr. Trump has expressed hope that oil prices will fall lower in tweets and comments this week. His remarks have upset some shale drillers, who say continued drops could hurt the U.S. fracking industry, and the Trump administration’s stated goals of American “energy dominance,” at a time when the country’s oil output is at all-time highs.
The U.S. broadly is reaping benefits. Consumers are enjoying lower prices at the gasoline pump. Higher oil production helped the U.S. lower its merchandise trade deficit by nearly $250 billion in 2017 from a decade earlier, according to a recent report from IHS Markit.
As the U.S. has exported more oil and natural gas, the country’s energy trade balance swung into surplus in October, according to data from Bank of America Merrill Lynch.
The fact that the U.S. is exporting more than it imports helps insulate the country from global price swings and raises the stakes for OPEC in its decision whether or not to cut production, analysts said.
“We’re rewriting the rules about how we think about global trade competition and market share,” said Michael Tran, energy strategist at RBC Capital Markets. “There’s no playbook or context given how quick growth has been in the U.S.”
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https://wattsupwiththat.com/2018/11/24/peter-foster-another-report-reluctantly-admits-that-green-energy-is-a-disastrous-flop/
Shocking! :roll:
After all the hoopla and subsidies, solar and wind combine for 1% of global energy. Even that is exaggerated because at crucial times in crucial places solar and wind energy production fall to zero.
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https://www.nationalreview.com/news/feds-discover-largest-oil-natural-gas-reserve-in-history/?fbclid=IwAR14zIGPgnYBenHXqQkNVICu1qpPr7Yj59p9Nejp2_9Xc1RKQPPG3sGHM4A
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https://www.instituteforenergyresearch.org/renewable/electric-generating-costs-a-primer/?fbclid=IwAR0zMsj5rIHXDADJij0cKYJlYPRnyI4yMd84-I_v4d3vwmj1EMeGL4Gh3yg
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y Nektaria Stamouli
Dec. 20, 2018 1:25 p.m. ET
Greece, Cyprus and Israel said on Thursday they are ready to proceed with a U.S.-backed pipeline project that would transfer natural gas from the Eastern Mediterranean to Europe.
The EastMed pipeline would bring gas from the sea between Israel and Cyprus to European Union markets via Greece. If construction goes ahead, it would spell the end for an alternative pipeline route for Israeli gas via Turkey. EastMed is expected to be 2,000 kilometers long.
After meeting in Be’er Sheva, Israel, the leaders of Greece, Cyprus and Israel said they were ready to sign an intergovernmental agreement on the pipeline project. It is expected to be signed in Greece in early 2019 after the project receives EU regulatory approval.
Gas reserves in the Eastern Mediterranean are estimated at 125 trillion cubic feet, according to energy consulting firm Wood Mackenzie. They could give the region an economic boost and help diversify Europe’s gas supply away from Russia. But the race to exploit the reserves is entangled with contested territorial claims and longstanding tensions between Cyprus and Turkey.
EastMed would be the longest and deepest underwater pipeline in the world, and would have the capacity to carry up to 20 billion cubic meters of gas annually. Construction is expected to take around six to seven years and to cost around $7 billion.
The shortest and fastest route to take gas from the Eastern Mediterranean to Europe would be through Turkey. But Ankara’s difficult relations with Israel, the EU and the U.S. have undermined support for that solution.
Turkey, which wants a share of Eastern Mediterranean reserves, objects to the EastMed project. It also strongly opposes any exploitation of gas reserves in Cyprus’s exclusive economic zone.
Turkey has occupied the northern part of Cyprus since 1974 and doesn’t recognize the government of Cyprus, an EU member, or its border agreements with its neighbors. Turkey has repeatedly threatened to mobilize its armed forces if Cyprus exploits gas around the island without its agreement.
Cyprus, Greece and Israel are hoping that U.S. support for the EastMed project will help it come to fruition. Officials from the three smaller countries said they are hoping U.S. companies will invest in the project, and that the U.S. will put diplomatic pressure on Turkey to accept the project.
U.S. ambassador to Israel David Friedman, who joined the meeting on Thursday, said the U.S. supports the EastMed pipeline, a project “of great importance for the stability and prosperity of the Middle East and Europe.” He urged all countries in the region to ensure its success.
U.S. energy giant Exxon Mobil Corp. is currently drilling for oil and gas off Cyprus. Turkey has called the company’s activity unilateral and destabilizing for the region, but hasn’t tried to stop it. Earlier this year, the Turkish navy blocked a drill ship owned by Italian oil-and-gas company Eni SpA from entering Cypriot waters shortly after Eni said it has discovered meaningful reserves.
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https://www.westernjournal.com/lawmakers-overwhelmingly-vote-revitalize-nuclear-industry/
Time for Hollywood to come out with China syndrome 2 staring 80 yo Fonda
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OPEC is losing power. In a statement provided to Turkey’s Anadolu Agency, the executive director of the International Energy Agency said that by 2025, U.S. oil production will equal Russia and Saudi Arabia’s combined output. The IEA anticipates that the production levels of OPEC+ countries will grow only modestly in the next five years, with U.S. production reaching an anticipated 17 million barrels per day by 2023. Meanwhile, the United Arab Emirates said that if the most recent OPEC+ cuts of 1.2 million barrels per day do not sufficiently boost oil prices, it would be willing to hold an extraordinary meeting to pursue more cuts.
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ccp:
https://www.westernjournal.com/lawmakers-overwhelmingly-vote-revitalize-nuclear-industry/
Amazing development. Is someone out there reading the forum?
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***Amazing development. Is someone out there reading the forum?***
Doug, you have been calling this for decades! Finally they are taking your advice
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If I recall my college history , the "New Deal " did not help get us out of the depression .
The "Great Society" deal started us on the road to 22 trillion in debt.
New we have another "Green Monster" that will thrill the "I wanna be a revolutionary" millennial crowd:
https://www.washingtonpost.com/news/powerpost/paloma/the-energy-202/2018/12/19/the-energy-202-lots-of-people-support-the-green-new-deal-so-what-is-it/5c1944641b326b2d6629d4e8/?noredirect=on&utm_term=.bf43cf2ddd08
Let's not make America great lets make us green and broken to a thirld world country
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If I recall my college history , the "New Deal " did not help get us out of the depression .
The "Great Society" deal started us on the road to 22 trillion in debt.
New we have another "Green Monster" that will thrill the "I wanna be a revolutionary" millennial crowd:
https://www.washingtonpost.com/news/powerpost/paloma/the-energy-202/2018/12/19/the-energy-202-lots-of-people-support-the-green-new-deal-so-what-is-it/5c1944641b326b2d6629d4e8/?noredirect=on&utm_term=.bf43cf2ddd08
Let's not make America great lets make us green and broken to a thirld world country
A wasted decade in America while Germany turned to Hitler and Nazism, I doubt if there was enough free market economic wisdom even when we were in college to teach how harmful and counterproductive the government programs were to the economy and the people.
Try Amity shlaes for a good look at it, https://en.m.wikipedia.org/wiki/The_Forgotten_Man:_A_New_History_of_the_Great_Depression
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" On the other hand, The Forgotten Man and its key arguments have been criticized by liberal Nobel Prize-winning economist Paul Krugman, among others. Krugman wrote of "a whole intellectual industry, mainly operating out of right-wing think tanks, devoted to propagating the idea that FDR actually made the Depression worse...."
Krugman again
I remember my history class in mid 70s where it was made clear FDR did not help the depression.
This is not new.
Did Paul, the political hack, Krugman notice the book he takes issue with lambasted Hoover - a Republican !!!
To Krugmen - go back to communist Russia where you must have come from .
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The World's Oil Producers Prepare for a New Era of Low Prices
Highlights
The oil market is likely to remain oversupplied in 2019, leading OPEC and non-OPEC countries to cut production to prevent another collapse in prices similar to 2014-15.
Prices are likely to remain weaker than what many of major producers anticipated just three months ago.
Venezuela will find itself in a most difficult spot because lower revenue will drive competition among the country's political elites, exacerbating its political crisis.
For the United States, the domestic impacts will be both positive and negative, but Washington may now have the freedom to lean heavily on Iran's oil customers and force them to reduce those imports even further.
Saudi Arabia will encounter difficulties because it must use state-led development — financed through oil revenue — to achieve Crown Prince Mohammed bin Salman's ambitious reforms.
Heading into 2019, oil producers are getting the feeling that they've seen this market before. That suspicion was reinforced last month when the price of global benchmark Brent crude briefly fell below $50 for the first time since June 2017. In addition, for the second time in five years, declining oil prices have forced global oil producers to stabilize the market by cutting production by 1.2 million barrels per day (bpd). And for the second time in those five years, producers will have to deal with the consequences of low prices, even if the pain might not be as bad this time around.
The Big Picture
Since the start of October, oil prices have fallen by roughly a third, raising concerns among the globe's oil producers. Many of them are continuing to deal with the aftereffects of the 2014-15 price collapse, which led them to make significant economic reforms. Those changes were slowed by some producers last year after an uptick in prices. Now, amid the latest drop in prices, Stratfor looks at some of the challenges that major oil producers are likely to face in 2019.
See A Crude Recovery
An Oil Market Under Pressure
Russia, Saudi Arabia and other members of OPEC may have been victims of their own success in 2018. After cutting oil production to start 2017, resulting in the slow rise in prices during 2017 and 2018, the coalition of OPEC and non-OPEC countries — the so-called OPEC+ — decided in June 2017 to relax some production curbs. But higher oil prices also spurred tight oil producers in North America — the nemesis of OPEC+ — to boost investment to accelerate production growth. As a result, U.S. production hit a record 11.5 million bpd in October 2018 — a nearly 2 million bpd increase over the previous year.
High growth in U.S. production, rising output from Saudi Arabia, sanctions waivers for the purchase of Iranian oil and a weak global economy due to the U.S. trade war, prompted oil markets to begin a sell-off. While prices are likely to rise in part because of Riyadh's decision to cut production again (U.S. President Donald Trump had pressured Saudi Arabia to increase production before the Iran sanctions took effect in November 2018), there is no escaping the simple truth: The oil market remains oversupplied, even with the cuts. What's more, U.S. output will likely provide all the growth — if not more — that is needed to satisfy the market in 2019. As a result, prices could remain at current lows for much of the year, with most estimates ranging from $40 to $75 per barrel.
The recent drop in prices resembles the fall seen in the second half of 2014. This time around, however, many oil producers won't have to make the same painstaking economic adjustments as they did in 2015. Most have already implemented long-term initiatives to alleviate the problems created by low prices. So what, precisely, is in store for some of the world's most important producers?
A chart shows the price of Brent crude oil from 2010 through 2018.
Saudi Arabia Unfazed
Crown Prince Mohammed bin Salman responded to falling oil prices by promising to reduce subsidies and institute significant austerity measures in 2015, when the country's budget deficit peaked at $97.9 billion. Riyadh also launched the Vision 2030 plan in April 2016 to increase the kingdom's revenue from non-oil streams, to boost the private sector and to diversify the economy away from a dependence on oil exports. Although Riyadh has seen success with some Vision 2030 goals (non-oil revenue rose from 115 billion riyals in 2014 to 287 billion riyals ($76.5 billion) in 2018), it has struggled to entice foreign investment and to jump-start the private sector. Both goals lie at the heart of Vision 2030.
To pick up the slack, Riyadh has had to fall back on its long-standing economic strategy: make the necessary investments on its own or resort to its sovereign wealth fund, the Public Investment Fund, to pay for domestic projects. Lower oil prices put the desert kingdom in a bind. It cannot make the necessary adjustments to quickly stimulate the private sector or attract investment, even though it must shore up its domestic economy since the crown prince remains under global pressure after the murder of dissident journalist Jamal Khashoggi. Saudi Arabia's budget for 2019 aims to do the latter. Riyadh is planning not only to introduce its highest budget ever but also to boost capital spending by 20 percent, meaning it needs an oil price of about $90 per barrel to break even. But because the kingdom wishes to maintain its spending plans despite low oil prices, Riyadh will likely continue to rack up debt at a significant pace.
Russia's Many Headaches
Like Saudi Arabia, Russia suffered some significant pain in 2014 and 2015 as prices declined. Moreover, Moscow opted to continue floating the ruble on international currency markets, causing it to substantially weaken as oil prices fell. For Russia, this decision has had contrasting ramifications. While it did make imports more expensive and force the Kremlin to rely more on borrowing and reserve withdrawals to plug budget holes, it also boosted non-oil exports, since the weakened ruble made Russian agriculture and industrial goods more competitive. Moscow also adopted a wise approach to rising oil prices by avoiding the temptation to implement an expansionary budget; instead, it took any oil revenue above $40 per barrel and deposited it in a rainy-day fund or used it to reduce its deficit. It has also pursued more comprehensive reform efforts at home, increasing its value added tax from 18 percent to 20 percent for the 2019 budget and continuing austerity measures, which led to a small budget surplus last year.
A lower oil price will certainly result in a budget deficit for Russia, but low prices are just one of many concerns for its economy. Washington continues to expand its sanctions against the Kremlin in a number of fields, even threatening measures against Russian energy pipelines, such as Nord Stream 2, which would jeopardize aspects of Moscow's long-term economic strategy. For the past five years, Moscow has emphasized reducing its economic dependence on the West by expanding economic ties to Asia, but the move has ultimately provided Russia with little succor due to the downturn in Asian markets amid the U.S.-China trade war.
Iran's Worst Nightmare
Perhaps no country will feel the pinch from lower prices as much as Iran. The country's oil exports had already fallen by about 1 million bpd due to the U.S. decision to reintroduce sanctions after pulling out of the Iranian nuclear deal, but the low prices will only exacerbate the situation for the Islamic republic. The Trump administration granted 180-day waivers to eight countries to let them continue importing Iranian oil in part because of the October 2018 spike in oil prices. But if the market remains oversupplied by the time the waivers come up for renewal in May, Washington will have more room to press Tehran's customers to further reduce — or eliminate — those imports. For Iran, the prospect that it will lose most of its buyers is even more worrying than the decline in the price of oil itself, given that the knock-on economic effects are causing serious political repercussions at home.
Perhaps no country will feel the pinch from lower oil prices as much as Iran.
On Dec. 25, 2018, President Hassan Rouhani presented the country's 2019-20 budget, which envisions about 1 million to 1.5 million bpd of oil exports, as well as a price of $50 to $54 per barrel. But even if Iran attains that level of exports, it will suffer an economic recession due to the precipitous drop in oil exports and the increased cost of imports due to the rial's steep decline, as well as U.S. efforts to limit the country's access to hard currency. Politically, this will continue to weaken Rouhani to the benefit of Iran's conservatives and hard-liners, although the Islamic republic will, for the time being, achieve the bare minimum — avoiding an economic collapse.
Iraq Struggles to Dole out Its Oil Wealth
Iraq, now the world's fourth-largest oil producer, faced two major challenges during the last price dip in 2014. Not only did prices collapse, sending Baghdad into a financial tailspin, but the Islamic State also raced across western and northern Iraq, capturing key areas of production. And while the militant group is no longer capable of holding urban centers like Mosul, it remains a terrorist threat. What's more, Iraq can little afford the $88 billion price tag for the reconstruction of areas decimated by the Islamic State. So far, it has only received $30 billion for the rebuilding effort after an international donor conference last year in Kuwait, yet most of those funds are in the form of credits and loans that Baghdad must ultimately repay.
Rising oil prices in 2018 allowed Iraq to finally post a budget surplus, thanks to conservative price assumptions and deeply unpopular austerity measures implemented by former Prime Minister Haider al-Abadi. A continuation of this would allow Baghdad to use capital spending to help rebuild some of the damaged areas (indeed, the 2019 budget envisions a one-third increase in capital expenditures), but lower oil prices have put those plans in jeopardy. Prime Minister Adel Abdul-Mahdi has failed to form a Cabinet as political infighting between rival Shiite factions has prevented him from filling the critical posts of defense minister and interior minister. At the same time, Iraq's sectarian and ethnic composition will also tax its limited ability to rebuild the country and extend services to all citizens. Most of the areas destroyed by the Islamic State are predominantly Kurdish and Sunni, but Abdul-Mahdi will be reluctant to allocate a lot of money to such reconstruction projects, because residents of the country's oil capital, the southern Shiite city of Basra, have made strident demands for more jobs, more public services and better access to water. In the end, Iraq is likely to witness protests throughout 2019 as the country's leaders struggle to meet competing demands amid the decline in oil prices.
Venezuela's Slow-Burning Crisis
In Venezuela, the collapse of oil prices threw the country into a deep economic spiral that will fundamentally alter its economic activities for decades. After prices plunged in 2014, Caracas chose to fund its gaping deficit by expanding its monetary base, fanning hyperinflation. The government slashed imports and defaulted, or fell behind, on virtually all foreign debt payments — even those to crucial creditors such as China and Russia.
Now, Caracas is slowly moving away from decades of relying on oil production for virtually all of its export income. It's doing so out of necessity rather than choice. With the decline in oil revenue, the government of President Nicolas Maduro is looking for additional sources of funding to keep its political coalition intact with payouts and benefits. Oil production has declined by nearly 1 million bpd since the start of 2018, and other sources of revenue, such as illicit mining, will provide far less income than crude oil exports. This will drive greater competition between Venezuelan elites for revenue from illicit mining and other illegal activities, such as cocaine trafficking. In the long run, this instability will likely claim the Maduro government — and even persist into a new, opposition-led administration.
A U.S. of Winners and Losers
For most of the developed world, cheap oil is a good thing. After all, the European Union, Japan, China and South Korea are all significant net oil importers. And despite rising oil production at home, the United States also remains a large importer for now. More importantly, much of the U.S. economy consumes large amounts of oil, meaning low prices are a boon. At the same time, weaker prices also indicate a relatively sluggish global outlook, which hinders U.S. commercial activity worldwide.
Much of the U.S. economy consumes large amounts of oil, meaning low prices are a boon, yet weaker prices also indicate a relatively sluggish global outlook, which hinders U.S. commercial activity worldwide.
Lower prices in 2015 and 2016 halted North American growth in the production of tight oil; the present drop in oil prices could now lead companies that had been making investment plans when prices exceeded $70 per barrel to curtail those proposals. Already, several shale producers have canceled drilling rig additions in 2019. But many producers took out hedges when prices were high, and production break-even costs in some of the most productive U.S. shale plays in the Permian Basin are $45 to $50 per barrel. This means that while the oil patch could suffer some financial pain if prices remain low, it may not be enough to shut or reduce production overall.
No Guarantees
Three months ago, $90 per barrel of oil was not out of the question, as Brent spiked at $85 per barrel. Prices could quickly rise if there are changes in market conditions, such as the health of the global economy, but they could also remain low if conditions worsen or the U.S.-China trade war deepens. The OPEC+ countries most concerned about oil prices have decided to do whatever it takes to balance the market, including further cuts beyond the reduction they implemented on Jan. 1. Even if this does increase prices, OPEC+ will likely find itself in a similar position to what happened in 2017 and 2018 when prices rose: Higher prices stimulate more production growth in North America, obliging producers to make cuts permanent or deeper to offset strong growth elsewhere. Oil producers may be in for the rude awakening as $50 to $60 per barrel becomes the new normal, and anything outside that range will likely be a temporary blip. And whatever the new normal turns out to be, most countries now have little choice but to shape their economic and financial strategies with that $50-$60 range in mind.
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https://www.investors.com/politics/editorials/co2-emissions-economy/
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Is bringing manufacturing back to the US a bad thing? More jobs, more people re-entering the workforce means more people driving to jobs and job interviews, are these bad things? With prosperity, jet travel is up. COLD winter last year, was that bad for global warming?
We should start by banning fossil fuel heat, air conditioning and jet travel for Democrats and climate scientists.
When they change their own usage (cf Al Gore and his 'carbon neutral' heated swimming pools) and start supporting truly carbon-free nuclear plants I will begin to take them seriously.
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Nearly 1500 Private Jets arrive at Climate Change focused Davos Summit
https://nypost.com/2019/01/23/nearly-1500-private-jets-to-land-at-climate-change-focused-davos-summit/
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Opinion piece in Frankfurt newspaper this am:
https://m.faz.net/aktuell/wirtschaft/teure-umweltpolitik-klimaschutz-als-neue-ersatzreligion-16018515.html
Climate protection as a religion
A COMMENT BY HOLGER STELTZNER
The Federal Government raises the climate far beyond other important policy areas, such as social affairs or the economy. Can we hope that the Union still comes to its senses?
Will the land of the inventors of petrol and diesel engines really abolish this? Or do German politicians still remember and stop the destruction of the economic heart chamber of Germany? After all, Munich has measured and found that the air was cleaner than feared and measured by the State Environmental Agency. The Federal Environmental Agency has incidentally informed that the fine dust limits are exceeded more in any German conurbation. Let's see what medium that was worth a message today. Hopefully, many other cities will also measure up to avoid driving bans.
Does it help the global climate, if local diesel cars drive in Eastern Europe or German coal-fired power plants are operated in emerging countries? We would have to move forward as a rich industrialized country for others to follow, it says. That's how the energy transition was founded. But no country followed us in the extreme subsidization of renewable energy, rightly, because in this country, the CO2 emissions sink only slightly.
What environmental problem kills most people, recently asked in a conversation with the Sunday newspaper the Danish world improver Bjørn Lomborg : air pollution within buildings, because nearly three billion people cook and heat wood, cardboard, manure or coal. Environmental scientists have calculated how best to use a euro to do as much good as possible for the climate. We cut off catastrophically: "For every euro that we spend in the EU, we avoid just 3 cents of climate impacts in the future."
Where should the electricity come from in the future?
Such inconvenient facts are not noted in Germany. Climate protection has the status of a substitute religion in large parts of society. An extremely expensive exit from coal is decided, although nobody knows how coal and nuclear power can be rapidly replaced, which today account for more than half of German power generation. Where the additional power for the seven to ten million politically wanted electric cars should come is not even asked. From French nuclear or Polish coal-fired power plants?
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Just as the millions who have moved to the Southwest need water and air conditioning, people in the north need heat, not as a luxury but to live. Natural gas and nuclear energy are the two greatest and cleanest resource technologies of our time, natural gas more than twice as clean as coal and nuclear 100% CO2 emision-free.
The 'Green New Deal' proposes to eliminate both. Hard to take this extreme proposal seriously but if these laws were in effect today, nearly all of us here would be dead, no exaggeration.
I've been gone a week and temps are still below zero. Without natural gas, you would heat millions of homes how? The wind coincidentally has been near zero and same for solar panels constantly covered in wind blown snow during these lowest sun angle times of year in the north country.
What the Ocasios propose to shut off all nuclear and all fossil fuel use is not cognitive dissonance, it is negligent genocide.
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https://www.powerlineblog.com/archives/2019/01/why-green-energy-is-futile-in-one-lesson.php
http://www.startribune.com/bitter-cold-shows-reliable-energy-sources-are-critical/505165032/
[In California, not affected by the upper midwest's extreme winter weather] Wind is operating a 3 percent of installed capacity, solar is operating at 12 percent of capacity.
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Doug writes "
"Hard to take this extreme proposal seriously but if these laws were in effect today, nearly all of us here would be dead, no exaggeration."
Didn't one Democrat recently state as much. That if the human race died off it would be best for the environment.
I just read that somewhere but cannot find now.
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For some reason all momentum seems to be against nuclear energy right now which makes no sense if you want to reliably power the economy and curtail carbon dioxide emissions.
Nuclear power peaked in 1996 because of a slump in fossil fuel costs. The financial crash of 2008 was a big setback, as was the Fukushima Daichi tsunami disaster of 2011. MIT Tech Review reports that "equipment costs have risen 20 percent since 2010, in part because of heightened safety requirements".
https://www.technologyreview.com/s/537816/why-dont-we-have-more-nuclear-power/
In fact, this demonstrates my main point of Fukushima in that much learning occurred relating to increased safety of new construction out of this natural disaster, worst case scenario.
Tech Review adds: "as low-carbon wind and solar power got cheaper". Some key words are missing there; the first names of solar and wind are 'heavily subsidized' and the last name of both and especially solar is the phrase 'after dark' highlighting their unavoidable weakness, zero power often when needed most. In other words, not a solution at all.
Finally, someone out there is reading the forum, see this new article in City Journal:
https://www.city-journal.org/atomic-power
"Closing New York’s second-largest power plant would seem to put a major crimp in the state’s electricity supply. And, since nuclear energy releases no carbon dioxide into the atmosphere, replacing Indian Point’s power with natural gas (the state’s largest source of electric power) promises to increase the region’s CO2 emissions."
- To be replaced with renewable sources that have zero and near zero power after dark which in northern NY is up to 15 hours of the day.
"The New York Independent System Operator, a nongovernmental bureau that supervises the flow of electricity around the state, has studied how it will meet the demand for power after Indian Point closes. Its conclusion: three gas-fired power plants now under construction—and not the promised wind and solar installations—will make up the shortfall."
- We are moving to carbon-free by moving from carbon-free back to carbon fossil fuels. That makes sense to whom?
Back to City Journal: "Don’t turn off those nuclear-powered lights just yet. ... In recent years, some eco-pragmatists and climate scientists have begun touting the advantages of zero-carbon nuclear energy—and poking holes in overblown hopes for renewables. These “pronuclear Greens,” as Robert Bryce dubbed them in a 2013 City Journal article, include former NASA climate scientist and current climate activist James Hansen, Greenpeace cofounder Patrick Moore, and environmental guru (and onetime Whole Earth Catalog publisher) Stewart Brand."
...
"In September, a bipartisan group of senators, including Lisa Murkowski, Cory Booker, and Dick Durbin, introduced the Nuclear Energy Leadership Act, a grab bag of initiatives to “rejuvenate the U.S. nuclear industry” and “drive innovation in advanced reactors.” The bill aims to streamline approvals for the next generation of nuclear technology and help U.S. companies become globally competitive again."
"President Trump signed a related bill, intended to boost public-private partnerships in nuclear research, into law in September."
...
"Secretary of Energy Rick Perry has floated two ambitious proposals to help keep both nuclear and coal plants in business. The administration argues that maintaining existing coal and nuclear facilities is necessary to keep the electric grid “resilient”—that is, able to recover quickly from a disruption. And grid resiliency is vital for national security."
...
"New Jersey’s nuclear subsidy will cost ratepayers $300 million per year. But New Jersey already forces consumers to fork over $600 million to subsidize solar. And those solar installations only generate 2.8 terawatt-hours of power. By contrast, the four nuclear plants covered in the plan produce 28 terawatt-hours of power—ten times as much. [For half the cost, a twenty-fold value improvement!]
...
[James] Hansen joined three other climate activists in stating: “Nuclear energy can power whole civilizations, and produce waste streams that are trivial compared to the waste produced by fossil fuel combustion.”
...
"spent nuclear fuel needs to be stored carefully, of course. But the fuel’s extreme density allows storage facilities to be quite small. Despite widespread fears, accidents involving spent nuclear fuel have been few and inconsequential. Compared with that of strip mines, oil wells, railroads, and pipelines—or, for that matter, vast arrays of solar panels and wind turbines—nuclear power’s total environmental footprint is almost dainty."
"the biggest concern is safety. “A lot of people say, ‘I understand the case for nuclear, but if things go wrong, it’s catastrophic,’ ” Shellenberger says. “But it turns out, that’s not true.” Three Mile Island caused no fatalities. At Fukushima, only one radiation-linked death has been confirmed, that of a worker who died of lung cancer seven years after the accident."
[Soviet Chernobyl is not a comparable facility.]
"Shellenberger sees the Fukushima disaster as, ironically, bolstering the argument for nuclear. “We’ve seen the worst that can happen and it’s not that bad!” "
[More importantly, the learning that took place in that disaster is of extreme value.]
"the fear of nuclear radiation turned out to be more deadly than the accident itself."
"All energy sources involve risks for both civilians and workers. ... In the U.S., more workers have died falling off rooftops while installing solar panels than in the entire history of commercial nuclear power."
[Again, for a fraction of the needed megawatts.]
...
"A “zero-carbon grid” is feasible only if we keep “firm low-carbon resources” in the mix. Today, that mostly means nuclear power."
...
"Despite obtaining 38 percent of its electricity from renewable sources, Germany has made little progress bringing down carbon emissions. Meanwhile, electricity rates have doubled, air quality is miserable, and the country still depends on coal for about 40 percent of its power."
...
Macron, France: "“What did the Germans do when they shut all their nuclear in one go?” he asked rhetorically in a 2017 interview. “They worsened their CO2 footprint."
----------------------------------------------------
[Doug] In short, we cannot cut our emissions without nuclear and we cannot have resilience in our grid without nuclear.
Take the last cold snap here for example. Homes [lives] in the north country depend on both electricity and natural gas for heating. The furnaces use both. The blower and the safety equipment on the high efficiency furnaces DO NOT WORK without electricity and when gas is not available, electric heaters are the only alternative. The more we switch to solar and wind, the more we rely on natural gas to make up the ENORMOUS gaps. Then when the extreme weather hits as it always does, and the natural gas supply and pipelines hit and surpass their limits and homes and lives go without heat. Not by coincidence this happens right while death is 5 minutes or so away in exposure. Powering the grid isn't some joke or trivial political matter.
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Pasting here from the Homeland thread:
https://chicagoboyz.net/archives/59310.html
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U.S. energy exports to Europe. The European Union will try to facilitate a doubling of imports of U.S. liquefied natural gas by 2023, EU and U.S. officials said Thursday. It seems a modest goal considering that Europe’s LNG imports from the U.S. have grown by 272 percent since Washington and Brussels released a joint statement last July declaring their intent to improve energy cooperation. Moreover, the EU is currently using only 26 percent of its available capacity for LNG imports. The bottleneck comes from the U.S. side, where export capacity is still limited. The assistant U.S. secretary for fossil energy, however, said the U.S. would more than double its export capacity, to 112 billion cubic meters per year from 50 bcm per year, by 2020. Washington wants to boost natural gas sales to Europe so that the Continent will be less reliant on Russian supplies.
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May 15, 2019
By Xander Snyder
Is the Shale Revolution Here to Stay?
Critics of the U.S. shale industry question its staying power.
Summary
U.S. shale oil is a booming business. As it drives up global oil supply and puts downward pressure on oil prices, U.S. production of shale oil poses a geopolitical threat to other oil-producing states. But critics say that the boom won’t last. If true, that changes the geopolitical calculus.
How much longer will shale oil be a booming business? The answer to that question, while fuzzy, has long-term geopolitical implications. U.S. shale oil production has grown steadily, putting downward pressure on the global price of oil. We’ve written before about the power of shale oil and the impact it has on other geopolitically important oil producers like Russia and Saudi Arabia, which rely heavily on oil revenue to either fund their government spending or support their economies. Our forecasts for these countries are built in part on the assumption that, as the global supply of oil increases, its price will hit a ceiling that could strain these countries’ public finances, which in turn would have political ramifications. But shale skeptics maintain that the industry is not sustainable. If they’re right, and if the shale industry were to die out in the next couple of years, tanking oil supply and spiking oil prices, the geopolitical calculus for Russia and Saudi Arabia would change substantially.
The critics’ argument is threefold. First, they claim that the shale boom depended on huge amounts of debt that was doled out without serious consideration for whether shale producers would be able to pay it back. Second, critics are worried that there’s less shale oil available than originally believed, reflected in shale wells’ depletion rates. Third, they see limited room for growth in the profitability of shale production as shale’s break-even price has stagnated. Combine these factors, the critics say, and you get an industry that will not endure. This Deep Dive will take a closer look at these criticisms and explore whether, in fact, U.S. shale really is an economically sustainable industry.
Shale: A Primer
To understand the criticisms of the industry, it’s important to understand what shale is and how oil is extracted from it – a technically complex and expensive process. Shale rock, embedded thousands of feet under the Earth’s surface, is less permeable than other types of rock. And yet it’s here that shale oil, or “tight oil,” is found. The extraction process for this oil is known as hydraulic fracturing – or “fracking” – and it requires drilling down to the shale deposits, and then drilling horizontally through the rock. The drillers then inject a water-based solution at high velocity to break apart the rock, creating fissures through which oil can flow. (This process can also be used to extract natural gas from shale deposits.)
(click to enlarge)
The U.S. shale industry really took off in 2009. Thanks to the United States’ extensive shale formations, it has benefited hugely from the shale revolution. The combined technologies of hydraulic fracturing and horizontal drilling vastly increased the productivity of shale wells, and overall U.S. oil production has increased apace. In 2018, the U.S. produced an average of nearly 11 million barrels per day of crude oil, almost 60 percent of which came from shale. It’s helped the U.S. surpass Russia and Saudi Arabia in the production of hydrocarbons and is pushing the U.S. toward becoming a net energy exporter, a benchmark it’s expected to reach next year.
Financing: The Catalyst
Financing was, in many ways, the engine that drove the rise of shale oil, but the industry’s reliance on debt has also threatened to bring it down. In the wake of the 2008 financial crisis, interest rates fell, making debt cheaper and borrowing easier. In the low-interest rate environment, investors were looking everywhere for yield. Shale looked particularly appealing for debt investors since reserves could be used as collateral – if companies failed to pay their debts, the banks could simply take control of the reserves. This created the appearance of added security.
The availability of cheap, accessible debt coincided with two other important moments that created a turning point: skyrocketing oil prices and technological developments that had made the economics of shale drilling viable (though still expensive). Shale production took off, reversing a decadeslong decline in U.S. oil production that had begun in the 1970s.
Debt, however, is a double-edged sword. In exchange for immediate access to capital, firms assume higher operating costs down the road. This can lead to firms becoming over-leveraged as they assume so much debt that they cannot afford to both pay off the debt and pay regular operating expenses. So when oil prices tanked in 2015-16, many over-leveraged companies went out of business, causing U.S. oil production to drop from about 9.4 million bpd in 2015 to 8.8 million bpd in 2016. Notably, this was not an accident. Global oil supply had been climbing thanks to shale production. When supply is too high, OPEC typically cuts production to drive prices back up. But in 2015-16, OPEC chose not to cut supply, hoping that low prices would drive shale producers out of business and thus allow OPEC countries to reclaim market share they had lost to shale.
This downturn threatened to prove right concerns that, without high oil prices and access to cheap, plentiful debt, shale is not an economically viable industry. Companies had taken on unsustainable amounts of debt to fuel growth. When interest rates began to climb, the need to service that debt was a further incentive for shale companies to continue production – even if operations were barely or not at all profitable. These firms’ lending used to set up new wells created debt service expenses, which led to total operating expenses exceeding cash coming in from operations for too long; if interest rates had continued to rise, the entire industry would be, if not sunk, at least forced to slow production. This was not lost on debt investors, who of course feared that bankruptcies would wipe out most of their investment. As oil prices fell, access to debt capital decreased, forcing cash-strapped shale companies to turn instead to equity financing (that is, to issue more stock).
(click to enlarge)
Bankruptcies did, in fact, increase substantially when oil prices plummeted in 2015-16. Banks, as they are wont to do, had offered loans based on current or recent conditions, without consideration for what would happen when oil prices dropped – an inevitability in a cyclical industry like oil. Meanwhile, larger companies bought up the assets of the smaller, less efficient ones, leading to industry consolidation.
But the cycle continued, despite OPEC’s best efforts to keep prices down long enough to destroy the shale industry, and conditions improved. As a number of companies went bankrupt, oil supplies decreased, and prices rose once again. The companies that survived were forced to cut their capital expenditures, which actually led to an improvement in cash flow. Since 2016, bankruptcies have declined significantly.
(click to enlarge)
Still, some industry observers continued to insist that the economics of the industry itself – not just of individual companies – were fundamentally unsustainable because they relied too heavily on debt. They claimed that debt was not just one factor in shale’s growth but in fact the decisive factor. Without it, they said, the industry couldn’t survive, because total expenses, including debt services fees, would continue to exceed revenue. Since 2016, however, shale drillers have moved toward positive, or at least neutral, cash flow. As of early 2018, a greater share of shale companies was beginning to cover the cost of new wells with operating cash flow, rather than debt. Rystad Energy, an oil and gas market research firm, anticipates that in 2019 shale drillers will generate enough cash to cover capital expenses and pay dividends, though just barely.
(click to enlarge)
If shale companies have enough cash remaining to pay dividends – even just a little bit – it’s a sign that they have enough cash on hand to better pay their debts. As of the fourth quarter of 2018, about 40 percent of companies in a 33-company sample of shale producers were cash-flow positive. To be economically viable, more companies will need to at least break even – in the case of shale, that means they need to generate enough cash from operations to cover their operating expenses without external capital.
(click to enlarge)
So, while a good number of shale companies do seem to be in precarious financial situations, many are trending toward positive cash flow. And just because some companies are at risk of going out of business doesn’t mean that shale oil production will cease. Truly cash-strapped companies can sell their assets to major international oil companies that have diversified revenue streams and can keep shale machinery offline until oil prices rise. In other words, as time goes on, the shale industry will mature and, like any industry, experience both bankruptcies and consolidation as some companies prove to be more efficient operators than others.
Oil Reserves: Estimating What’s Out There
But it’s not just financing that shale skeptics criticize. They’re concerned, too, that shale companies substantially overestimated their reserves. They’re not wrong; many oil companies have had to revise their total reserve estimates downward, and it seems their initial overestimations were directly related to the question of financing. If companies had higher reserves – a form of collateral – they could take on more of the debt they needed to get underway. Similarly, when debt financing dried up in 2015-16 and companies started to issue stock, they overestimated their reserves so that it would be easier to raise money from investors.
How were oil companies able to convince banks and investors that their oil reserves were larger than they actually were? Oil-producing companies in the U.S. are required to file with the Securities and Exchange Commission estimates of their “total proven oil reserves” – the reserves for which there is a 90 percent chance that the oil will be recovered. But as the fledgling shale industry was starting to raise money, companies began to use a metric called “estimated ultimate recovery” instead. EUR simply refers to existing reserves, without indicating the likelihood of recovery. The metric is also based on the assumption that, as time goes on, companies would be able to replicate their early success – that additional wells would produce as much as already tapped wells. In retrospect, this was flawed logic; the initial wells are almost always the most productive ones.
Shale drillers also assumed they could pack shale wells close together. But packed too tightly, the wells would pull from shared reserves, decreasing the amount that each could draw. Both assumptions contributed to overly optimistic EUR numbers.
In response, investors are now scrutinizing shale producers’ claims. They began by questioning shale companies’ estimates of their reserves – and therefore whether they were worth investing in – and have started pushing for greater accountability in firms’ capital expenditures and demanding higher returns. As a result, shale companies are now exercising more oversight of capital expenditures, cutting spending, moving toward positive cash flow, and using that cash flow to return dividends to investors or to buy back shares. All of this is bolstering the economic sustainability of the industry.
Shale producers’ estimates affect more than just financing. Market research firms and the U.S. Energy Information Administration (which is responsible for collecting and reporting economic data on the energy industry that is used in policymaking and economic forecasting) take into consideration the reserve estimates that companies put out. Historically, forecasts of U.S. shale oil production have been outstripped by actual production, and current forecasts are almost uniformly positive – the EIA and industry consulting firms Rystad Energy and Wood Mackenzie all anticipate substantial increases in oil production over the next 10 years, even with lower oil prices. That’s good news for the shale industry – even with more conservative estimates of their reserves, shale oil isn’t going anywhere.
(click to enlarge)
The industry also stands to benefit from pipelines scheduled to come online in late 2019 and early 2020. Production has been constrained by a lack of transportation infrastructure in the U.S., and these pipelines will facilitate transport of resources from the Permian Basin, the source of nearly one-third of U.S. oil output, to refineries and export centers in places like the Gulf Coast. It seems shale oil production will continue growing, though at a somewhat slower pace than the industry initially anticipated.
(click to enlarge)
Supply and Profitability: The Geopolitical Question
Ultimately, what affects geopolitics is not the durability of one shale company or another – it is the price of oil and whether the supply of oil continues to increase. And even if the growth in U.S. shale oil production slows, the industry will likely persist for at least the next decade. Skeptics have questioned the shale industry’s ability to sustain high levels of production since it took off over a decade ago. But U.S. production has often outperformed forecasts, and we have to keep this in mind when examining claims that the shale industry is not financially viable.
One of the primary concerns here is the industry’s profitability. As the industry has grown and matured, the break-even price per well has come down. But some doubters claim that there are fewer gains to be made through technological advances. If true, this would mean that the break-even point will not come down much further, leaving little room for growth in the profitability of shale. This may be a valid criticism. But that still puts the profitable oil price for a lot of shale companies well below Saudi Arabia’s fiscal break-even point (the point at which the government can balance its budget), which the International Monetary Fund says is currently about $80-$85 per barrel.
(click to enlarge)
Another, more convincing critique examines the relationship between long-term supply and profitability. It’s based on comparing production rates in the Bakken Formation and the Eagle Ford Group, some of the earliest shale basins to be tapped, with the Permian Basin, whose development only took off in 2013. The U.S. has seen net oil production gains since 2016, and much of those gains were from new wells, especially in the Permian Basin. Meanwhile, however, production in Bakken and Eagle Ford has declined following the 2015-16 downturn. (Eagle Ford has stagnated, while Bakken has only recently inched above its pre-2015 production levels.)
(click to enlarge)
Since Eagle Ford and Bakken are older discoveries than the Permian, critics suggest that the former are more representative of what shale basins will be capable of producing after several years of drilling, and that those production levels will be much lower than following the initial discovery, when only the choicest wells were being drilled. The Permian’s production has an outsize effect on total U.S. production. If it follows the trend of its predecessors, that effect would be problematic.
(click to enlarge)
New wells usually produce more oil at the outset, and the rate at which oil flows thereafter is called the decline rate. The Permian’s decline rates are rising faster than expected. Take, for example, Wolfcamp – one of the drilling areas within the Permian Basin. When drilling in the Permian got underway in 2013, observers expected decline rates of 5-10 percent; but Wolfcamp’s rate is now closer to 15 percent annually. Shale companies will need to drill more wells just to keep producing the same volume of oil. If Eagle Ford, Bakken and Permian production all stagnate or decline, that could constrain the amount of oil the U.S. is able to produce in the long run.
That’s assuming no new reserves are discovered. But, in fact, new reserves are discovered often – even in the Permian itself. In December, the U.S. Department of the Interior reported that the Permian’s Wolfcamp and Bone Spring Formations contain the most oil and gas resources of any location ever assessed. Still, that was not an assessment of proven reserves – those that can be recovered using existing technology – but rather of undiscovered reserves – defined by the department as “resources postulated, on the basis of geologic knowledge and theory, to exist outside of known fields of accumulations” – and technically recoverable reserves – defined as “resources producible using currently available technology and industry practices.” For now, companies are poised to continue producing enough to fuel growth in U.S. oil production. But if Permian production stagnates, they may well have to keep finding more reserves – and ways to extract them – to make it last.
What’s Ahead for Shale
The cycle of the oil industry goes on. Demand for oil may decline as countries shift toward fuel-efficient and electric vehicles. But demand for petrochemicals (chemical products for which oil is an input) will continue to grow as more people in the world’s most populous countries – namely, India and China – move into the middle class. The growing demand for oil will drive prices up, enabling shale drillers to increase production and, therefore, producers to rely less on debt – and even to start paying dividends.
It’s no surprise, then, that countries that rely heavily on the oil industry are having to rethink the underpinnings of their economies. (Saudi Arabia, for example, is working to reconfigure its economy to depend less on oil.) The U.S. could also become energy independent, which could have significant geopolitical implications.
The combination of hydraulic fracturing and horizontal drilling, which paved the way for the shale revolution in the U.S., is out of the box and can’t be put back in. The technology will continue to allow the U.S. to produce large quantities of oil for the foreseeable future. Shale isn’t going anywhere – and it will have a major influence over the global economics of oil for at least the next decade.
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https://finance.yahoo.com/news/silence-storm-oil-markets-230000063.html
Trump could pick up the phone and threaten or cajole or simply ask Crown Prince Mohammed bin Salman to open up the spiggets if he wants continued military support
he has I believe already done this once.
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This is such a big story and it is still developing. The strangest part is that the climate extremists want to stop the movement to natural gas that is cleaning up the environment more than any other factor.
https://www.realclearenergy.org/articles/2019/08/22/us_shale_natural_gas_lowering_global_prices_and_co2_emissions.html
...
U.S. shale surge has led to dramatically lower gas prices (we are currently experiencing the lowest summer prices in over 20 years) and a shift in U.S. manufacturing (from oil to gas) and electricity (from coal to gas). Beyond lower cost, this transformation has been environmentally beneficial as well: natural gas emits 30% less CO2 than oil and 50% less than coal.
...
natural gas this year will supply nearly 40% of U.S. power, about double what it provided before the shale revolution. Gas is also the backup fuel to compensate for the natural intermittency of wind and solar power: gas is needed for when "the wind is blowing" and "the sun isn’t shining." The U.S. is now reducing its CO2 emissions faster than any country on Earth: "Thanks to Natural Gas, US CO2 Emissions Lowest Since 1985."
https://www.realclearenergy.org/articles/2018/07/06/more_natural_gas_is_slashing_us_co2_emissions_110310.html
...
US Shale changed geo-politics
https://www.cityam.com/how-the-us-shale-revolution-changed-the-face-of-geopolitics/
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(Solar waste is the worst, and battery waste.)
https://www.wsj.com/articles/the-nuclear-waste-is-safe-what-about-other-waste-11567194084
Other Waste?
The casks used to store nuclear fuel are designed to withstand accidents worse than seismic events.
Aug. 30, 2019 3:41 pm ET
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The Nuclear Regulatory Commission is considering whether to put nuclear waste at two sites in the Permian Basin. An inactive oil rig stood in Andrews, Texas, in July. PHOTO: SERGIO FLORES/BLOOMBERG NEWS
For the last 20 years, I have periodically evaluated the performance of used nuclear fuel in dry-cask storage—the same nuclear-waste form being considered for the Permian Basin sites in Texas and New Mexico (“Fight Brews over Nuclear Waste in Oil Patch,” U.S. News, Aug. 15). I couldn’t help see the irony in promoters of fracking, which according to the U.S. Geological Survey can increase seismic activity, worrying about the safety of dry-cask storage of nuclear waste. Nuclear waste always gets a bum rap, but it may be the only waste that is never purposely released into the environment. It is always managed, controlled and highly regulated.
Can the oil industry or any heavy industry say the same about its waste? The casks used to store nuclear fuel are designed to withstand accidents worse than seismic events, which will be benign to these large and heavy containers. The biggest risk to dry-cask storage is probably corrosion caused by exposure to air typical of coastal regions, which is managed by monitoring. Hard to see that being an issue in the Permian Basin.
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Solar waste doesn't create giant monsters, so there is that!
(https://s16-us2.startpage.com/wikioimage/01bee0fb9ba9162d96c918d764920a6c.jpg)
(Solar waste is the worst, and battery waste.)
https://www.wsj.com/articles/the-nuclear-waste-is-safe-what-about-other-waste-11567194084
Other Waste?
The casks used to store nuclear fuel are designed to withstand accidents worse than seismic events.
Aug. 30, 2019 3:41 pm ET
SAVE
SHARE
TEXT
4
The Nuclear Regulatory Commission is considering whether to put nuclear waste at two sites in the Permian Basin. An inactive oil rig stood in Andrews, Texas, in July. PHOTO: SERGIO FLORES/BLOOMBERG NEWS
For the last 20 years, I have periodically evaluated the performance of used nuclear fuel in dry-cask storage—the same nuclear-waste form being considered for the Permian Basin sites in Texas and New Mexico (“Fight Brews over Nuclear Waste in Oil Patch,” U.S. News, Aug. 15). I couldn’t help see the irony in promoters of fracking, which according to the U.S. Geological Survey can increase seismic activity, worrying about the safety of dry-cask storage of nuclear waste. Nuclear waste always gets a bum rap, but it may be the only waste that is never purposely released into the environment. It is always managed, controlled and highly regulated.
Can the oil industry or any heavy industry say the same about its waste? The casks used to store nuclear fuel are designed to withstand accidents worse than seismic events, which will be benign to these large and heavy containers. The biggest risk to dry-cask storage is probably corrosion caused by exposure to air typical of coastal regions, which is managed by monitoring. Hard to see that being an issue in the Permian Basin.
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Electricity prices going UP because of so-called renewables.
in Minnesota, electricity is 500 percent more expensive than natural gas on an energy equivalent basis.
- Data from the U.S. Energy Information Administration
https://www.americanexperiment.org/2019/09/clueless-minneapolis-city-leaders-sam-rockwell-problem-not-natural-gas-use/
See if you can see the solar contribution to electricity production in this Minnesota winter chart, yellow-orange color. Also note the near zero wind contribution on the coldest days. We will make up the difference with what? Batteries??
(https://2lffqo2moysixpyb349z0bj6-wpengine.netdna-ssl.com/wp-content/uploads/2019/08/Xcel-energy-polar-vortex-february-5-no-wind-no-solar.png)
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https://www.bloomberg.com/news/articles/2019-08-26/sometimes-a-greener-grid-means-a-40-000-spike-in-power-prices
The road to a world powered by renewable energy is littered with unintended consequences. Like a 40,000% surge in electricity prices.
Texas power prices jumped from less than $15 to as much as $9,000 a megawatt-hour this month as coal plant retirements and weak winds left the region on the brink of blackouts during a heat wave. It’s a phenomenon playing out worldwide. Germany averted three blackouts of its own in June and has seen prices both spike and plunge below zero within days as it swaps out coal and nuclear energy for wind and solar. In the U.K., more than a million homes lost power on Aug. 9, in part because a wind farm tripped offline.
The recent stumbles serve as a warning shot to the rest of the world as governments work to displace aging nuclear reactors and coal-fired power plants with cheaper and cleaner renewable energy. Grid operators, policy makers and power providers are learning the hard way that losing massive, around-the-clock generators can be a challenge, if not carefully planned.
“We have to have systems in place to make sure we still have enough generation on the grid -- or else, in the best case, we have a blackout, and in the worst case, we have some kind of grid collapse,” said Severin Borenstein, an energy economist at the University of California at Berkeley, where state officials have a goal of getting all power from clean energy resources by 2045.
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Okay followers of Elizabeth Warren et al, you have been warned.
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from Economist 2013:
https://www.economist.com/business/2013/08/03/the-father-of-fracking
of course the LEFT would place him along (and above) Hitler, Stalin, Mao, Tamerlane, Khan and the rest as the worst mass murderer in human history.
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https://www.cnbc.com/2019/09/14/oil-could-rise-10-per-barrel-after-drone-attack-forces-saudi-to-cut-output.html
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For large parts of the year in most locations, solar and wind only generate electricity 10-30% of the time. The gaps in these ups and downs of solar and wind must be made up with fossil fuels, coal now being replaced with cleaner natural gas. Natural gas electrical production can ramp up and down as easily as turning up or down the burner on your gas stove. For every watt that the electrical utility company relies on solar and wind combined at its peak, they must have at least that capacity in fossil fuel generation - and use it (fossil fuels) most of the day, most of the year. The more we rely on solar and wind, the more fossil fuel use we will require.
What is wrong with this picture?
Nuclear does not ramp or scale up and down suddenly and is not an usable complement to the ups and downs of solar and wind. Nuclear generates a steady flow of electricity on a massive scale over a long period of time. The more we rely on nuclear power, the less we need solar and wind, and the less we need fossil fuels to generate electricity. If we power the entire grid with nuclear power, fossil fuels will have near-zero use in the electricity generation sector. Carbon free electricity, if you like that kind of thing.
Solar and wind are not just a good investment for an oil and gas company or just good PR, they are ESSENTIAL existential investments. Solar wind guarantee them major market share in grid power generation. Lack of solar and wind investments replaced by nuclear would take that market share to nil.
And you have seen this trade-off fully explained in the lamestream media, when, where?
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https://www.forbes.com/sites/judeclemente/2017/12/31/natural-gas-is-the-flexibility-needed-for-more-wind-and-solar/#1b6147195777
The "sunshine state" is now surging toward having gas generating 75-80% of its electricity by 2022. ... the U.S. needs to add 25,000 megawatts of gas peaking capacity to our grid over the next decade to support the wind and solar build-outs. ... gas is the glue of the new U.S. electric power system, not just adding critical flexibility but also reliability. "New York's grid operator yesterday said the state's grid can sustain the loss of a major nuclear station near New York City if some combination of three new natural gas projects replaces it,"
Renewables and natural gas are not mutually exclusive. The reality is that they complement each other, but unfortunately neither the gas nor the renewable industry promote this collaboration enough.
[Doug: This is better than carbon-free?]
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https://spectrum.ieee.org/energy/renewables/to-get-wind-power-you-need-oil
[this is separate from the phenomenon that if you rely on wind you need gas.]
... the aggregate installed wind power of about 2.5 terawatts would require roughly 450 million metric tons of steel. And that’s without counting the metal for towers, wires, and transformers for the new high-voltage transmission links that would be needed to connect it all to the grid.
A lot of energy goes into making steel. Sintered or pelletized iron ore is smelted in blast furnaces, charged with coke made from coal, and receives infusions of powdered coal and natural gas. Pig iron is decarbonized in basic oxygen furnaces. Then steel goes through continuous casting processes (which turn molten steel directly into the rough shape of the final product). Steel used in turbine construction embodies typically about 35 gigajoules per metric ton.
To make the steel required for wind turbines that might operate by 2030, you’d need fossil fuels equivalent to more than 600 million metric tons of coal.
A 5-MW turbine has three roughly 60-meter-long airfoils, each weighing about 15 metric tons. They have light balsa or foam cores and outer laminations made mostly from glass-fiber-reinforced epoxy or polyester resins. The glass is made by melting silicon dioxide and other mineral oxides in furnaces fired by natural gas. The resins begin with ethylene derived from light hydrocarbons, most commonly the products of naphtha cracking, liquefied petroleum gas, or the ethane in natural gas.
The final fiber-reinforced composite embodies on the order of 170 GJ/t. Therefore, to get 2.5 TW of installed wind power by 2030, we would need an aggregate rotor mass of about 23 million metric tons, incorporating the equivalent of about 90 million metric tons of crude oil. And when all is in place, the entire structure must be waterproofed with resins whose synthesis starts with ethylene. Another required oil product is lubricant, for the turbine gearboxes, which has to be changed periodically during the machine’s two-decade lifetime.
Undoubtedly, a well-sited and well-built wind turbine would generate as much energy as it embodies in less than a year. However, all of it will be in the form of intermittent electricity—while its production, installation, and maintenance remain critically dependent on specific fossil energies. Moreover, for most of these energies—coke for iron-ore smelting, coal and petroleum coke to fuel cement kilns, naphtha and natural gas as feedstock and fuel for the synthesis of plastics and the making of fiberglass, diesel fuel for ships, trucks, and construction machinery, lubricants for gearboxes—we have no nonfossil substitutes that would be readily available on the requisite large commercial scales.
For a long time to come—until all energies used to produce wind turbines and photovoltaic cells come from renewable energy sources—modern civilization will remain fundamentally dependent on fossil fuels.
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For every watt produced through wind, nearly two must be produced by fossil fuels instead of carbon free nuclear.
https://www.michigancapitolconfidential.com/tripling-states-1100-wind-turbines-wont-replace-this-one-coalgas-plant
"The problem is that those [wind] turbines only spin about one-third of the time..." [in Michigan].
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Did you want electricity available 24/7/365, or do you want to become a third world country?
The sun doesn't shine and the wind doesn't blow during peak demand hours, and nuclear doesn't scale up and down to make up the difference:
(https://alcse.org/wp-content/uploads/2017/05/Duck-curve-chart-2.jpg)
https://alcse.org/the-duck-curve-what-is-it-and-what-does-it-mean/
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Is the Shale Revolution Here to Stay?
Critics of the U.S. shale industry question its staying power.
By
Xander Snyder -
May 15, 2019
Open as PDF
Summary
U.S. shale oil is a booming business. As it drives up global oil supply and puts downward pressure on oil prices, U.S. production of shale oil poses a geopolitical threat to other oil-producing states. But critics say that the boom won’t last. If true, that changes the geopolitical calculus.
How much longer will shale oil be a booming business? The answer to that question, while fuzzy, has long-term geopolitical implications. U.S. shale oil production has grown steadily, putting downward pressure on the global price of oil. We’ve written before about the power of shale oil and the impact it has on other geopolitically important oil producers like Russia and Saudi Arabia, which rely heavily on oil revenue to either fund their government spending or support their economies. Our forecasts for these countries are built in part on the assumption that, as the global supply of oil increases, its price will hit a ceiling that could strain these countries’ public finances, which in turn would have political ramifications. But shale skeptics maintain that the industry is not sustainable. If they’re right, and if the shale industry were to die out in the next couple of years, tanking oil supply and spiking oil prices, the geopolitical calculus for Russia and Saudi Arabia would change substantially.
The critics’ argument is threefold. First, they claim that the shale boom depended on huge amounts of debt that was doled out without serious consideration for whether shale producers would be able to pay it back. Second, critics are worried that there’s less shale oil available than originally believed, reflected in shale wells’ depletion rates. Third, they see limited room for growth in the profitability of shale production as shale’s break-even price has stagnated. Combine these factors, the critics say, and you get an industry that will not endure. This Deep Dive will take a closer look at these criticisms and explore whether, in fact, U.S. shale really is an economically sustainable industry.
Shale: A Primer
To understand the criticisms of the industry, it’s important to understand what shale is and how oil is extracted from it – a technically complex and expensive process. Shale rock, embedded thousands of feet under the Earth’s surface, is less permeable than other types of rock. And yet it’s here that shale oil, or “tight oil,” is found. The extraction process for this oil is known as hydraulic fracturing – or “fracking” – and it requires drilling down to the shale deposits, and then drilling horizontally through the rock. The drillers then inject a water-based solution at high velocity to break apart the rock, creating fissures through which oil can flow. (This process can also be used to extract natural gas from shale deposits.)
(click to enlarge)
The U.S. shale industry really took off in 2009. Thanks to the United States’ extensive shale formations, it has benefited hugely from the shale revolution. The combined technologies of hydraulic fracturing and horizontal drilling vastly increased the productivity of shale wells, and overall U.S. oil production has increased apace. In 2018, the U.S. produced an average of nearly 11 million barrels per day of crude oil, almost 60 percent of which came from shale. It’s helped the U.S. surpass Russia and Saudi Arabia in the production of hydrocarbons and is pushing the U.S. toward becoming a net energy exporter, a benchmark it’s expected to reach next year.
Financing: The Catalyst
Financing was, in many ways, the engine that drove the rise of shale oil, but the industry’s reliance on debt has also threatened to bring it down. In the wake of the 2008 financial crisis, interest rates fell, making debt cheaper and borrowing easier. In the low-interest rate environment, investors were looking everywhere for yield. Shale looked particularly appealing for debt investors since reserves could be used as collateral – if companies failed to pay their debts, the banks could simply take control of the reserves. This created the appearance of added security.
The availability of cheap, accessible debt coincided with two other important moments that created a turning point: skyrocketing oil prices and technological developments that had made the economics of shale drilling viable (though still expensive). Shale production took off, reversing a decadeslong decline in U.S. oil production that had begun in the 1970s.
Debt, however, is a double-edged sword. In exchange for immediate access to capital, firms assume higher operating costs down the road. This can lead to firms becoming over-leveraged as they assume so much debt that they cannot afford to both pay off the debt and pay regular operating expenses. So when oil prices tanked in 2015-16, many over-leveraged companies went out of business, causing U.S. oil production to drop from about 9.4 million bpd in 2015 to 8.8 million bpd in 2016. Notably, this was not an accident. Global oil supply had been climbing thanks to shale production. When supply is too high, OPEC typically cuts production to drive prices back up. But in 2015-16, OPEC chose not to cut supply, hoping that low prices would drive shale producers out of business and thus allow OPEC countries to reclaim market share they had lost to shale.
This downturn threatened to prove right concerns that, without high oil prices and access to cheap, plentiful debt, shale is not an economically viable industry. Companies had taken on unsustainable amounts of debt to fuel growth. When interest rates began to climb, the need to service that debt was a further incentive for shale companies to continue production – even if operations were barely or not at all profitable. These firms’ lending used to set up new wells created debt service expenses, which led to total operating expenses exceeding cash coming in from operations for too long; if interest rates had continued to rise, the entire industry would be, if not sunk, at least forced to slow production. This was not lost on debt investors, who of course feared that bankruptcies would wipe out most of their investment. As oil prices fell, access to debt capital decreased, forcing cash-strapped shale companies to turn instead to equity financing (that is, to issue more stock).
(click to enlarge)
Bankruptcies did, in fact, increase substantially when oil prices plummeted in 2015-16. Banks, as they are wont to do, had offered loans based on current or recent conditions, without consideration for what would happen when oil prices dropped – an inevitability in a cyclical industry like oil. Meanwhile, larger companies bought up the assets of the smaller, less efficient ones, leading to industry consolidation.
But the cycle continued, despite OPEC’s best efforts to keep prices down long enough to destroy the shale industry, and conditions improved. As a number of companies went bankrupt, oil supplies decreased, and prices rose once again. The companies that survived were forced to cut their capital expenditures, which actually led to an improvement in cash flow. Since 2016, bankruptcies have declined significantly.
(click to enlarge)
Still, some industry observers continued to insist that the economics of the industry itself – not just of individual companies – were fundamentally unsustainable because they relied too heavily on debt. They claimed that debt was not just one factor in shale’s growth but in fact the decisive factor. Without it, they said, the industry couldn’t survive, because total expenses, including debt services fees, would continue to exceed revenue. Since 2016, however, shale drillers have moved toward positive, or at least neutral, cash flow. As of early 2018, a greater share of shale companies was beginning to cover the cost of new wells with operating cash flow, rather than debt. Rystad Energy, an oil and gas market research firm, anticipates that in 2019 shale drillers will generate enough cash to cover capital expenses and pay dividends, though just barely.
(click to enlarge)
If shale companies have enough cash remaining to pay dividends – even just a little bit – it’s a sign that they have enough cash on hand to better pay their debts. As of the fourth quarter of 2018, about 40 percent of companies in a 33-company sample of shale producers were cash-flow positive. To be economically viable, more companies will need to at least break even – in the case of shale, that means they need to generate enough cash from operations to cover their operating expenses without external capital.
(click to enlarge)
So, while a good number of shale companies do seem to be in precarious financial situations, many are trending toward positive cash flow. And just because some companies are at risk of going out of business doesn’t mean that shale oil production will cease. Truly cash-strapped companies can sell their assets to major international oil companies that have diversified revenue streams and can keep shale machinery offline until oil prices rise. In other words, as time goes on, the shale industry will mature and, like any industry, experience both bankruptcies and consolidation as some companies prove to be more efficient operators than others.
Oil Reserves: Estimating What’s Out There
But it’s not just financing that shale skeptics criticize. They’re concerned, too, that shale companies substantially overestimated their reserves. They’re not wrong; many oil companies have had to revise their total reserve estimates downward, and it seems their initial overestimations were directly related to the question of financing. If companies had higher reserves – a form of collateral – they could take on more of the debt they needed to get underway. Similarly, when debt financing dried up in 2015-16 and companies started to issue stock, they overestimated their reserves so that it would be easier to raise money from investors.
How were oil companies able to convince banks and investors that their oil reserves were larger than they actually were? Oil-producing companies in the U.S. are required to file with the Securities and Exchange Commission estimates of their “total proven oil reserves” – the reserves for which there is a 90 percent chance that the oil will be recovered. But as the fledgling shale industry was starting to raise money, companies began to use a metric called “estimated ultimate recovery” instead. EUR simply refers to existing reserves, without indicating the likelihood of recovery. The metric is also based on the assumption that, as time goes on, companies would be able to replicate their early success – that additional wells would produce as much as already tapped wells. In retrospect, this was flawed logic; the initial wells are almost always the most productive ones. Shale drillers also assumed they could pack shale wells close together. But packed too tightly, the wells would pull from shared reserves, decreasing the amount that each could draw. Both assumptions contributed to overly optimistic EUR numbers.
In response, investors are now scrutinizing shale producers’ claims. They began by questioning shale companies’ estimates of their reserves – and therefore whether they were worth investing in – and have started pushing for greater accountability in firms’ capital expenditures and demanding higher returns. As a result, shale companies are now exercising more oversight of capital expenditures, cutting spending, moving toward positive cash flow, and using that cash flow to return dividends to investors or to buy back shares. All of this is bolstering the economic sustainability of the industry.
Shale producers’ estimates affect more than just financing. Market research firms and the U.S. Energy Information Administration (which is responsible for collecting and reporting economic data on the energy industry that is used in policymaking and economic forecasting) take into consideration the reserve estimates that companies put out. Historically, forecasts of U.S. shale oil production have been outstripped by actual production, and current forecasts are almost uniformly positive – the EIA and industry consulting firms Rystad Energy and Wood Mackenzie all anticipate substantial increases in oil production over the next 10 years, even with lower oil prices. That’s good news for the shale industry – even with more conservative estimates of their reserves, shale oil isn’t going anywhere.
(click to enlarge)
The industry also stands to benefit from pipelines scheduled to come online in late 2019 and early 2020. Production has been constrained by a lack of transportation infrastructure in the U.S., and these pipelines will facilitate transport of resources from the Permian Basin, the source of nearly one-third of U.S. oil output, to refineries and export centers in places like the Gulf Coast. It seems shale oil production will continue growing, though at a somewhat slower pace than the industry initially anticipated.
(click to enlarge)
Supply and Profitability: The Geopolitical Question
Ultimately, what affects geopolitics is not the durability of one shale company or another – it is the price of oil and whether the supply of oil continues to increase. And even if the growth in U.S. shale oil production slows, the industry will likely persist for at least the next decade. Skeptics have questioned the shale industry’s ability to sustain high levels of production since it took off over a decade ago. But U.S. production has often outperformed forecasts, and we have to keep this in mind when examining claims that the shale industry is not financially viable.
One of the primary concerns here is the industry’s profitability. As the industry has grown and matured, the break-even price per well has come down. But some doubters claim that there are fewer gains to be made through technological advances. If true, this would mean that the break-even point will not come down much further, leaving little room for growth in the profitability of shale. This may be a valid criticism. But that still puts the profitable oil price for a lot of shale companies well below Saudi Arabia’s fiscal break-even point (the point at which the government can balance its budget), which the International Monetary Fund says is currently about $80-$85 per barrel.
(click to enlarge)
Another, more convincing critique examines the relationship between long-term supply and profitability. It’s based on comparing production rates in the Bakken Formation and the Eagle Ford Group, some of the earliest shale basins to be tapped, with the Permian Basin, whose development only took off in 2013. The U.S. has seen net oil production gains since 2016, and much of those gains were from new wells, especially in the Permian Basin. Meanwhile, however, production in Bakken and Eagle Ford has declined following the 2015-16 downturn. (Eagle Ford has stagnated, while Bakken has only recently inched above its pre-2015 production levels.)
(click to enlarge)
Since Eagle Ford and Bakken are older discoveries than the Permian, critics suggest that the former are more representative of what shale basins will be capable of producing after several years of drilling, and that those production levels will be much lower than following the initial discovery, when only the choicest wells were being drilled. The Permian’s production has an outsize effect on total U.S. production. If it follows the trend of its predecessors, that effect would be problematic.
(click to enlarge)
New wells usually produce more oil at the outset, and the rate at which oil flows thereafter is called the decline rate. The Permian’s decline rates are rising faster than expected. Take, for example, Wolfcamp – one of the drilling areas within the Permian Basin. When drilling in the Permian got underway in 2013, observers expected decline rates of 5-10 percent; but Wolfcamp’s rate is now closer to 15 percent annually. Shale companies will need to drill more wells just to keep producing the same volume of oil. If Eagle Ford, Bakken and Permian production all stagnate or decline, that could constrain the amount of oil the U.S. is able to produce in the long run.
That’s assuming no new reserves are discovered. But, in fact, new reserves are discovered often – even in the Permian itself. In December, the U.S. Department of the Interior reported that the Permian’s Wolfcamp and Bone Spring Formations contain the most oil and gas resources of any location ever assessed. Still, that was not an assessment of proven reserves – those that can be recovered using existing technology – but rather of undiscovered reserves – defined by the department as “resources postulated, on the basis of geologic knowledge and theory, to exist outside of known fields of accumulations” – and technically recoverable reserves – defined as “resources producible using currently available technology and industry practices.” For now, companies are poised to continue producing enough to fuel growth in U.S. oil production. But if Permian production stagnates, they may well have to keep finding more reserves – and ways to extract them – to make it last.
What’s Ahead for Shale
The cycle of the oil industry goes on. Demand for oil may decline as countries shift toward fuel-efficient and electric vehicles. But demand for petrochemicals (chemical products for which oil is an input) will continue to grow as more people in the world’s most populous countries – namely, India and China – move into the middle class. The growing demand for oil will drive prices up, enabling shale drillers to increase production and, therefore, producers to rely less on debt – and even to start paying dividends.
It’s no surprise, then, that countries that rely heavily on the oil industry are having to rethink the underpinnings of their economies. (Saudi Arabia, for example, is working to reconfigure its economy to depend less on oil.) The U.S. could also become energy independent, which could have significant geopolitical implications.
The combination of hydraulic fracturing and horizontal drilling, which paved the way for the shale revolution in the U.S., is out of the box and can’t be put back in. The technology will continue to allow the U.S. to produce large quantities of oil for the foreseeable future. Shale isn’t going anywhere – and it will have a major influence over the global economics of oil for at least the next decade.
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https://www.washingtonpost.com/news/powerpost/paloma/the-energy-202/2019/03/25/the-energy-202-rick-perry-doubles-down-on-nuclear-energy-calling-it-the-real-green-new-deal/5c97dd741b326b0f7f38f24c/
Rick Perry's bias coming from Texas is no doubt oil and gas but the math and science all leads to carbon free nuclear power.
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Scientists extract hydrogen gas from oil and bitumen, giving potential pollution-free energy
https://wattsupwiththat.com/2019/11/11/scientists-extract-hydrogen-gas-from-oil-and-bitumen-giving-potential-pollution-free-energy/
https://phys.org/news/2019-08-scientists-hydrogen-gas-oil-bitumen.html
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Nuclear Power is the Most Reliable Energy Source and It's Not Even Close
FEBRUARY 27, 2018
... nuclear power plants are producing maximum power more than 92% of the time during the year.
That’s about 1.5 to 2 times more as natural gas and coal units, and 2.5 to 3.5 times more reliable than wind and solar plants.
https://www.energy.gov/ne/articles/nuclear-power-most-reliable-energy-source-and-its-not-even-close
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Who cares about reliability of electrical power? Mostly people in first, second and third world countries who want to plug in and want to know it will work. Not just toasters and hair dryers but manufacturing plants and hospitals with heart lung machines as well.
Not to mention that nuclear is carbon free with less toxic waste than solar.
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[The cleanest, safest energy is nuclear. Ships run well with fossil fuels.]
Another Lithium-Ion explosion, this time Norway:
Fire and Gas Explosion in Battery Room of Norwegian Ferry Prompts Lithium-Ion Power Warning
https://gcaptain.com/fire-and-gas-explosion-in-battery-room-of-norwegian-ferry-prompts-lithium-ion-power-warning/
Norwegian broadcasting company NRK reported that twelve firefighters were taken to the hospital for exposure to hazardous gases associated with the batteries.
“The Norwegian Maritime Authority recommends that all shipowners with vessels that have battery installations, carry out a new risk assessment of the dangers connected to possible accumulations of explosive gases during unwanted incidents in the battery systems,” the Norwegian Maritime Authority said in statement.
Alternatively, British Columbia-based, Corvus Energy, which supplied the ferry’s battery system, has issued recommendations to operators not to sail without communication between the shipboard energy management system and the battery packs, as well as what to do in case of a gas release or “thermal runaway situation.
Thermal runaway occurs when lithium-ion cell temperatures exceed the thermal runaway threshold, resulting in the sudden release of flammable, toxic gases and excessive heat that could result in an explosion.
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Who knew?
https://www.americanexperiment.org/2019/08/environmental-disaster-solar-energy/
Toxic minerals and compounds like Cadmium in rainwater washout and in landfills tells only part of the story. If solar (in the midwest) only works 18% of the time, fossil fuels, gas and coal, make up the difference, unlike nuclear energy that really is carbon free.
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"meaningful cuts won’t happen without nuclear"
https://www.wsj.com/articles/requiem-for-a-climate-dream-11575417278
If the world isn’t slashing CO2, blame overreaction to the Fukushima disaster.
...
Nuclearphobes should remind themselves that more people die each year from coal-mining accidents than have been killed in all the nuclear accidents in history. Never mind the tens of thousands who are statistically estimated to die annually from inhaling particulates. No technology is perfect, but NASA’s James Hansen, Microsoft founder Bill Gates, Gaia theorist James Lovelock, and the late Harvard economist Martin Weitzman are among the diverse and serious students of climate change who have said that meaningful cuts won’t happen without nuclear.
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To the green new deal crowd, cooking over a wood fire is far worse than natural gas. Electricity is better only if nuclear-based. Solar and wind subsidies lock in fossil fuel use, notice the oil companies' interest in that.
When will they ever learn?
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https://www.americanexperiment.org/2019/12/100-percent-windsolarbatteries-4296-50-monthly-electric-bill-according-to-an-xcel-energy-slide-show/
100 Percent Wind+Solar+Batteries= $1,036.80 Monthly Electric Bill, According to An Xcel Energy Slide Show and EIA Da
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Not hypothetical or overstated. They already doubled electric prices here while accomplishing nothing.
If you're serious about carbon free, give us nuclear power, safe, reliable and competitively priced.
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Banks Get Tough on Shale Loans as Fracking Forecasts Flop
Oil and gas companies face tightened credit after wells produce less than projected
Chevron has said it plans to take a charge of $10 billion to $11 billion, roughly half of it tied to shale gas assets. PHOTO: DANIEL ACKER/BLOOMBERG NEWS
By Christopher M. Matthews, Bradley Olson and Allison Prang
Updated Dec. 22, 2019 7:00 pm ET
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Some of the banks that helped fuel the fracking boom are beginning to question the industry’s fundamentals, as many shale wells produce less than companies forecast.
Banks have begun to tighten requirements on revolving lines of credit, an essential lifeline for smaller companies, as these institutions revise estimates on the value of some shale reserves held as collateral for loans to producers, according to people familiar with the matter.
Some large financial institutions, including Capital One Financial Corp. and JPMorgan Chase JPM -0.08% & Co., are likely to decrease the size of current and future loans to shale companies linked to reserves as a result of their semiannual reviews of the loans, the people say. The banks are concerned that if some companies go bankrupt, their assets won’t cover the loans, the people say.
JPMorgan Chase declined to comment. Capital One COF -0.01% didn’t respond to requests for comment.
The tightening financial pressure on shale producers is one of the reasons many are facing a reckoning going into next year. Chevron Corp. said Dec. 10 that it plans to take a charge of $10 billion to $11 billion, roughly half of it tied to shale gas assets, which it said won’t be profitable soon. Royal Dutch Shell PLC said Friday it will take a roughly $2 billion impairment, and other companies are expected to follow suit in writing down assets, according to analysts and industry executives.
The heat is greatest for small and midsize shale producers, including many whose wells aren’t producing as much oil and gas as they had projected to lenders and investors. Some of those companies may be forced out of business, said Clark Sackschewsky, the managing principal of accounting firm BDO’s Houston tax practice. Large companies are likely to weather the blow because of their size and global asset diversity, but for some smaller shale operators, tightening access to bank loans could prove disastrous.
“We’ve got another year under our belts with the onshore fracking assets, which includes less than optimistic reserves results, less production than anticipated, a reduction in capital investment into the market,” Mr. Sackschewsky said.
Oil and gas producers expect banks to cut their revolving lines of credit by 10% as a result of the reviews, according to a survey of companies by the law firm Haynes & Boone LLP. The cuts may be more severe, say some people familiar with the reviews.
Banks have extended billions of dollars of reserve-backed loans, though the exact size of the market isn’t known. JPMorgan said in a regulatory filing in September that it has exposure to $44 billion in oil and gas loans, and Capital One COF -0.01% said in October it has extended more than $3 billion in oil and gas loans. It wasn’t clear for either bank what proportion of those are backed by reserves.
Banks have typically applied a 10% discount to the value of reserves, meaning a shale company could borrow against 90% of its reserves as collateral. Banks have typically lent as much as 60% of that value. But some are now discounting the value by as much as 20%, the people say.
Meanwhile, some regional banks have begun writing off bad energy loans. Net charge-offs shot up at Huntington Bancshares in the last quarter. The Ohio-based lender attributed the move primarily to two energy loans where the borrowers’ production had not met expectations, Huntington Chief Executive Officer Stephen Steinour said in an interview.
“Geology and the assumptions were just flawed,” Mr. Steinour said.
Many investors have lost faith in the viability of shale drillers, as natural-gas prices stayed low and many companies broke promises on how much their wells would produce and when they would begin to turn a profit.
As investors have retreated, cracks have begun to show. Energy companies accounted for more than 90% of defaults on corporate debt in the third quarter, according to Moody’s Investors Service. There were more than 30 oil-company bankruptcies in 2019, exceeding the number in 2018 and 2017. Exploration and production companies are now carrying more than $100 billion in debt, according to Haynes & Boone.
Skepticism among banks has grown in part because lenders have more closely scrutinized public well data on production and seen that it is falling short of forecasts, as a Wall Street Journal analysis showed earlier this year.
Specifically, banks have begun questioning shale producers’ predictions about their wells’ initial rate of decline, which are proving overly optimistic, according to engineers. If shale wells, which produce rapidly early and then taper off, are declining faster than predicted, questions arise regarding how much they will ultimately produce.
SHARE YOUR THOUGHTS
What do you think tightened credit requirements mean for the shale industry as a whole? Join the conversation below.
Some lenders have flagged publicly that they will be less generous with loans in the future. “With respect to any new energy loans, we are highly cautious; it’s a very high bar we must clear,” said Paul B. Murphy, CEO of Cadence Bank, in an October call with analysts. The firm operates in Texas and the southeastern U.S.
Bank lending has slowed across the board in the country’s hottest drilling region, the Permian basin in West Texas and New Mexico. After leading Texas last year, loan growth in the region shrunk to 4.8,% below the state’s 7.5% average in the last quarter, the Federal Reserve Bank of Dallas said Thursday.
More than a decade into the shale boom, investors are trying to wrap their arms around the true value of producers’ assets, said Michelle Foss, an energy fellow at Rice University’s Baker Institute for Public Policy.
“There is a struggle now for investors to determine what things are actually worth,” Ms. Foss said.
Dwindling access to bank loans will put more pressure on an industry that has already lost access to other sources of money. Without new cash infusions, many companies may be unable to drill their undeveloped reserves, which could further diminish the value of their assets.
Some shale companies have been lobbying the Securities and Exchange Commission to change its rules governing reserves reporting, allowing them to count undeveloped assets as reserves for a longer period. The SEC currently allows oil and gas producers to report reserves as “proved” if the companies plan to develop them within five years.
In an August letter to the SEC, Continental Resources Inc., one of the largest shale companies, pushed for the regulator to extend that period to 10 years. The company, founded by the billionaire prospector Harold Hamm, said its proved reserves would be around 16% higher with such a rule change.
A Continental spokeswoman declined to comment. An SEC spokesman didn’t respond to a request for comment.
Write to Christopher M. Matthews at
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https://spectrum.ieee.org/energywise/energy/environment/ibm-new-seawater-battery-technology
This could change everything from power tools to electric vehicles.
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https://www.newyorker.com/news/dispatch/is-nuclear-power-worth-the-risk?source=EDT_NYR_EDIT_NEWSLETTER_0_imagenewsletter_Daily_ZZ&utm_campaign=aud-dev&utm_source=nl&utm_brand=tny&utm_mailing=TNY_Daily_122319&utm_medium=email&bxid=5be9d3fa3f92a40469e2d85c&cndid=50142053&esrc=&mbid=&utm_term=TNY_Daily
Painful to read liberals writing about science. She gets a few very important points right.
- a magnitude-nine earthquake, one of the most powerful in recorded history, triggered a twelve-story tsunami
- Doctors reported no cases of thyroid cancer that was rampant in Chernobyl.
- The most exposure she faced writing the whole story was on the flight to Japan [that all travelers experience.]
- That no serious approach to CO2 reduction today works without nuclear.
- More damage was done by the fear spread through words and policies than by radiation.
- The nuclear accident lengthened the life of the cows that were not evacuated (or slaughtered).
- Japan added 50 coal burning plants as a result of this.
- Finland has dealt effectively with the nuclear waste issue.
- Her conclusion is that there IS a role for nuclear energy - if you care about pollution and climate.
What is omitted or misrepresented is painful too. Start at the beginning. 9.0 earthquake is more than 100 times the intensity of the 6.9 1989 San Francisco disaster. A twelve story wall of water is something I think none of us have seen or heard of or can imagine.
- The tsunami killed more than more than 20,000 people.
- The Fukushima disaster killed one worker because of the diesel generator failure.
- It was the diesel generators that failed. Without that failure, no radiation whatsoever would have been released.
- How does a 12 story tsunami relate to the shutdown of nuclear power in Germany?
- Chernobyl is a story about Soviet failure, nothing to do with modern nuclear facilities.
- Hiroshima and Nagasaki were results of Japanese military aggression, nothing to do with nuclear power or nuclear accident.
- Switching to 100% renewable energy would mean the equivalent of $1000 per month electric bills for every household, would kill manufacturing jobs etc.
- Solar has 500 times more toxic waste than nuclear.
- Solar has ten times the death rate of nuclear power.
https://www.nextbigfuture.com/2008/03/deaths-per-twh-for-all-energy-sources.html
- Solar replacement of Fukushima, if it were possible, would take up 250,000 acres of land use, more than the whole town.
- The percentage of power Japan gets from renewable sources, primarily hydro, has greatly decreased since 1970.
https://www.eurotechnology.com/store/j_renewable/
- Intermittant power sources like solar and wind do not match 80% of the electrical demand.
https://www.instituteforenergyresearch.org/renewable/solar/solar-energy/
- Nuclear power is by far the safest and cleanest known energy source.
- All nuclear plants built after Fukushima would incorporate what was learned and would survive a 9.0 earthquake and 12 story tsunami.
- New nuclear technologies have zero waste and emissions.
- Long lead time to build is not a reason not to build.
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Outstanding post Doug!
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Thanks Marc.
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8-)
the Left's response:
https://www.google.com/search?q=the+greta+scowl&tbm=isch&source=univ&sa=X&ved=2ahUKEwjMxOm2ps_mAhWHmOAKHWV5DQoQsAR6BAgKEAE&biw=1440&bih=789
:-P
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everything in Doug's post
https://www.yahoo.com/author/david-knowles
https://news.yahoo.com/trump-huffs-and-puffs-about-windmills-but-wind-power-keeps-growing-203256114.html .
- complete with photo of Trump with the orange hair blowing in wind just to mock him more.
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everything in Doug's post
https://www.yahoo.com/author/david-knowles
https://news.yahoo.com/trump-huffs-and-puffs-about-windmills-but-wind-power-keeps-growing-203256114.html .
- complete with photo of Trump with the orange hair blowing in wind just to mock him more.
"roughly on a par with nuclear plants, although in terms of actual power generated (as distinguished from theoretical capacity), wind is still a fraction of nuclear and fossil fuels."
- it admittedly operates at a fraction of its potential. That about says it all.
Amazing how much they can build with free, printed money. Every mW of wind locks in about 3-4 times that much (1/ that fraction) of long term fossil fuel use since clean nuclear power cannot scale up and down with the wind. Every time you see a new wind turbine, remember to buy an oil company stock. Each new wind turbine sets the carbon-free energy movement back twenty years.
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Finding people who put my thoughts to words better than I do:
"I mean, if you say you care about the environment but you oppose nuclear power or fracking, then you’re an idiot or a liar."
- Glenn Reynolds, PJ Media Instapundit
https://pjmedia.com/instapundit/353989/#respond
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American technology, coverage on it in Europe and Asia, concern everywhere, action nowhere.
https://www.asiatimes.com/2020/01/article/carbon-dioxides-scourge-advanced-nuclear-power/
From the article:
"Would it not be more rational, if we believe that human emissions of CO2 are destroying the planet, to expand nuclear energy as quickly as possible, rather than shut it down?"
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Does anyone have a different answer, a better answer? Hydro power is perhaps best but there isn't enough of it. Solar and wind commitments lock in fossil fuel use and CO2 emissions forever. Nuclear has massive potential, the waste issue is solved, it's by far the safest, and it's carbon free. Who knew? When do we want to get started? Where's Greta?
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Google translate: Spiegel Germany, December 2019
https://www.spiegel.de/wissenschaft/rettet-uns-die-atomkraft-vor-dem-klimakollaps-a-00000000-0002-0001-0000-000167507158
New reactor
concepts: Does nuclear power save us from climate collapse?
Top researchers from the USA are developing the nuclear reactors of the future. Allegedly safe nuclear power plants are supposed to stop global warming.
By Philip Bethge
13.12.2019, 6 p.m.
The reactor core is almost completely filled with nuclear waste, which is practical, so that it comes away immediately. The machine should run for 60 years without refueling. The spent fuel rods from US nuclear power plants alone would be enough to cover the world's electricity needs for centuries.
Is this the solution to all energy problems? Lindsey Boles believes in it. The engineer from Terrapower is standing next to a blue steel frame, which is supposed to hold nuclear fuel rods, in a white lab coat with protective glasses made of plastic on her nose in a workshop in the US state of Washington. Color markings on the floor show the planned location of heat exchangers and pumps - it is the model of a reactor.
"Where we are now would be liquid sodium, heated to more than 500 degrees Celsius," explains Boles. "We believe that this type of system can generate climate-neutral electricity more reliably and safely than with any other power plant in the world."
Terrapower is one of a growing number of start-ups that are giving new hope to the power of the atom. The company's headquarters are in Bellevue, a suburb of Seattle. The US West Coast hubris pairs with technology optimism and fairytale financial strength.
(registration needed to read further)
https://terrapower.com/
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https://www.nationalreview.com/2020/01/the-warren-fracking-ban-would-devastate-america/
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https://www.wired.com/story/germany-rejected-nuclear-powerand-deadly-emissions-spiked/
The math of this is kind of obvious, end carbon free energy production and bad things happen.
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Nice find. Please post in the Nuclear thread as well.
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https://www.bloomberg.com/news/features/2020-02-05/wind-turbine-blades-can-t-be-recycled-so-they-re-piling-up-in-landfills
I wonder if Bloomberg reads Bloomberg...
FYI, Cutting fiberglass with a diamond blade causes dust inhale risk.
https://journal.chestnet.org/article/S0012-3692(16)56140-6/fulltext
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Companies are searching for ways to deal with the tens of thousands of blades that have reached the end of their lives.
February 5, 2020, 4:00 AM CST Updated on February 7, 2020, 10:54 AM CST
A wind turbine’s blades can be longer than a Boeing 747 wing, so at the end of their lifespan they can’t just be hauled away. First, you need to saw through the lissome fiberglass using a diamond-encrusted industrial saw to create three pieces small enough to be strapped to a tractor-trailer.
The municipal landfill in Casper, Wyoming, is the final resting place of 870 blades whose days making renewable energy have come to end. The severed fragments look like bleached whale bones nestled against one another.
“That’s the end of it for this winter,” said waste technician Michael Bratvold, watching a bulldozer bury them forever in sand. “We’ll get the rest when the weather breaks this spring.”
Tens of thousands of aging blades are coming down from steel towers around the world and most have nowhere to go but landfills. In the U.S. alone, about 8,000 will be removed in each of the next four years. Europe, which has been dealing with the problem longer, has about 3,800 coming down annually through at least 2022, according to BloombergNEF. It’s going to get worse: Most were built more than a decade ago, when installations were less than a fifth of what they are now.
Built to withstand hurricane-force winds, the blades can’t easily be crushed, recycled or repurposed. That’s created an urgent search for alternatives in places that lack wide-open prairies. In the U.S., they go to the handful of landfills that accept them, in Lake Mills, Iowa; Sioux Falls, South Dakota; and Casper, where they will be interred in stacks that reach 30 feet under.
“The wind turbine blade will be there, ultimately, forever,” said Bob Cappadona, chief operating officer for the North American unit of Paris-based Veolia Environnement SA, which is searching for better ways to deal with the massive waste. “Most landfills are considered a dry tomb.”
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Pa. House Speaker: Banning fracking would destroy Pennsylvania’s economy
https://www.inquirer.com/opinion/commentary/fracking-ban-2020-democrats-pennsylvania-shell-plant-20200225.html
One 2017 study ... found that a whopping 322,600 jobs were supported by oil and natural gas statewide in 2015, providing nearly $23 billion in wages, and that the industry contributes more than $44 billion in economic activity.
Residential natural gas customer costs have fallen significantly over the past 10 years, for an estimated $1,200 annual savings per household, representing a total savings of about $3 billion per year for the more than 2.5 million Pennsylvania households that use natural gas for heating, largely thanks to increased natural gas production. Billions of dollars have been paid in royalties to landowners in our state.
- Who knew?
The proposed ban might destroy the Democrats future too. But that's how it goes when you are trying to save the planet.
Ironically, fracking is responsible for roughly 100% of the recent DECREASE in US CO2 emissions.
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Daily Memo: Oil Prices Plunge
By: GPF Staff
Oil prices plummet. By now you’ve likely heard about the plunge in oil prices by more than 20 percent over the weekend – the largest drop in nearly three decades – with Brent crude bottoming out at $31.39 per barrel and, as of this writing, hovering around $35-$36. The drop was triggered after Russia and Saudi Arabia failed to come to an agreement on production cuts to combat declining demand. Shortly after the drop, the International Energy Agency revised its projection for oil demand this year; it now foresees a 90,000 barrel per day decline versus an 825,000 bpd increase previously. Monday is a holiday in Russia, so markets are closed and the government has time to plan its response. The Finance Ministry said, however, that Russia’s reserve fund could sustain oil prices at $25-$30 per barrel for six to 10 years, suggesting that Russia may be preparing to obstruct production cuts for some time to come. Still, the Russian ruble fell on Monday to 75 rubles on the dollar, the lowest level in four years, prompting the central bank to suspend the purchase of foreign currency domestically for 30 days, as required when prices dip below $42.40 a barrel. Other countries are also preparing their responses. Kazakhstan is developing an anti-crisis action plan and will make adjustments to the national budget for 2020-22. And Belarus said the decline was an opportunity to come to some sort of agreement on oil prices with Moscow.
Countries in the Middle East are also dealing with the fallout of the plunge. It’s no secret that Saudi Arabia’s economy relies heavily on oil, as does the government’s budget. As a result, Saudi Arabia will experience at least some financial strain and social tension resulting from declining prices. The Saudi government has adopted several measures in recent days to consolidate power, including a Cabinet reshuffle and detention of at least 20 princes. The drop in oil prices will magnify these political pressures. Elsewhere in the Middle East, Iraq’s parliamentary Economic Committee said the projected budget deficit for 2020 increased to approximately $42.8 billion because of the oil price decline. (Nearly 90 percent of Iraq’s budget is derived from oil revenue.) Kuwait also said it expected its budget deficit for 2020-21 to increase.
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Now Comes the Oil Shock
Putin shows again he’s not Trump’s friend. What about MBS?
By The Editorial Board
March 9, 2020 7:18 pm ET
President Trump has defended Saudi leader Mohammed bin Salman despite his displays of bad judgment or worse. If the crown prince wants to return the favor, now would be the time amid the panic in oil markets after a price war broke out between former cartel partners Russia and Saudi Arabia. How about putting in a call, Mr. President?
The immediate cause for this chaos is a game of chicken between Riyadh and Moscow. The Saudis were keen to orchestrate production cuts among fellow OPEC members and other major producers to sustain prices as oil demand falls due to Covid-19. Vladimir Putin refused, and in retaliation the Saudis slashed prices on Sunday and promised more production to steal market share from Russia.
Oil prices fell through the floor Monday with Brent crude closing at $34.36 a barrel, down 24% from Friday and 50% from its recent peak on Jan. 6. The shock triggered a fall in equities around the world, as investors fled to gold and bonds, with the Dow falling 7.8% Monday. A morning plunge of more than 7% triggered the New York Stock Exchange “circuit breaker” to pause trading for the first time since 1997.
This response is partly panic but it’s also rooted in rational fear, despite the benefit for consumers from lower oil prices. The market worry is that the oil-price plunge will hurt the U.S. economy—the main support for global growth these days—by damaging U.S. shale oil production.
Not long ago the U.S. imported most of its oil and natural gas. But the rise of fracking and horizontal drilling have made the U.S. an energy powerhouse. U.S. crude oil exports have soared from around an average of 490,000 barrels per day in January 2016 to 3.7 million barrels per day in December 2019. (See the nearby chart.) A sharp decline in global oil demand now hurts U.S. producers. The damage to producers and workers from a price collapse could exceed the benefit to consumers who pay less for gasoline.
Some shale producers are especially vulnerable because they’ve relied on easy credit fueled by low Federal Reserve interest rates. Analysts peg energy companies’ bond issuance at anywhere between 10% and 16% of the U.S. high-yield debt market. Widespread defaults on that debt could have systemic financial consequences for banks and other lenders.
The break-even oil price for these producers varies by company and the shale oil well, with some in Texas’s Permian Basin now claiming to be able to make money at $30 a barrel. Exxon and Chevron also own much shale production and have the balance sheets to ride out a downturn.
But a Dallas Fed survey in December found that, even before the price decline since January, two-thirds of oil and gas firms in its region expected to hold steady or reduce capital investment during 2020. And 59% of those firms said they’d need the price for West Texas Intermediate Crude to be above $50 a barrel to fund their capital investment.
Mr. Putin is willing to endure lower prices because he wants to break the U.S. shale industry. U.S. exports to Europe threaten Russia’s energy hold on Western Europe. He’s also sore at U.S. opposition to his Nord Stream 2 gas pipeline linking Siberia to Germany. This oil action is another example, among dozens already, that Mr. Putin isn’t Mr. Trump’s friend.
***
The Saudi strategy is harder to understand. Riyadh is cutting prices at the expense of its own national oil company, which recently floated shares in the public market. With the price cut, Aramco’s shares have fallen well below their December offering price. The Saudis last tried a stunt like this in 2014-15. Their target then was U.S. shale and they nearly tipped America into a recession as lower global prices pushed numerous U.S. oil-and-gas companies into bankruptcy.
The longer this oil-price war continues, the greater the danger that a crisis in the oil patch combined with the coronavirus will do broader damage. Even the resilient U.S. economy, which had been gaining steam as trade tensions eased, may be hard-pressed to power through the dual shocks of a pandemic and suddenly collapsing oil prices.
Crown Prince bin Salman, widely known as MBS, is famous for actions that seem rash and ill-considered. In this case he’s hurting Saudi interests by hurting his main geopolitical benefactor, the United States. President Trump may need to use the phone to remind the crown prince which country has stuck by him during his war with Yemen, his standoff with Qatar, and missile attacks from Iran.
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Why Saudi Arabia's Oil Price War May Backfire
6 MINS READ
Mar 10, 2020 | 13:49 GMT
The Big Picture
Saudi Arabia is offering aggressive discounting on its oil exports and planning to sharply increase volumes in April in the wake of its failure to agree with Russia on a path forward for OPEC+ production restraint. This move will damage the finances of oil exporters lacking diversified economies, but it is not likely that either the Saudis or the Russians will capitulate in the next few months. The result will be rapidly rising oil inventories and weak prices.
The Saudi Survival Strategy
After Russia refused last week to accept OPEC's proposal to cut oil production by 1.5 million barrels per day to prop up oil prices, Saudi Aramco announced on March 7 that it would lower its April pricing differentials by $4-$6 to Asia and $7 to the United States. The move took Asian differentials from premiums to steep discounts and Saudi Arabia strongly hinted at a substantial production increase, which Saudi Aramco sources confirmed to media outlets on March 8 without attaching specific numbers. The development, in turn, produced a shock to financial markets, with Brent crude oil down to $35 per barrel in late trading on March 9.
Why It Matters
The Saudi move is a declaration of a full-blown price war, which most observers did not foresee on March 6 when talks between OPEC and its nonmember partners fell apart, given that it would blow up the Saudi budget deficit, as well as the fact that Russia, even unconstrained by OPEC+ commitments, has limited potential to raise production quickly in 2020. It takes a situation in which the world oil market had been hit by a demand shock (shutdowns and other disruptions caused by the COVID-19 outbreak has sharply reduced the demand for oil) amid a modest slowdown in economic growth and added a supply shock of an unknown but potentially massive quantity. As a result, inventories will be building much more rapidly, though price drops are somewhat mitigated in the short-term by the availability of storage. But an extended COVID-19 crisis could easily force prices down to levels below where they were in 2015-2016. An extended price collapse into the $20s-$30s range, which is now likely for at least the next several months and perhaps much longer, will have broad knock-on effects on other markets. Other than energy equities, the worst impacts will be on sovereign finances of oil exporters with less-diversified economies and low sovereign reserves. In particular, Iran and Venezuela will suffer the most, as both have already been forced to sharply discount their sales to find buyers amid U.S. sanctions.
Saudi Arabia's decision to increase output likely reflects Crown Prince Mohammed bin Salman's hope that if he puts acute pressure on Russia, it will cave and agree to a significant production cut. But this all-out price war is counterproductive; as state oil company Rosneft outlined in a detailed statement on March 8, Russia was unwilling to cut production because in its view production restraint had simply led to growth in competing supply. This competition includes not just U.S. shale oil but also a lot of deep-water offshore investment in places like Guyana and Norway, stimulated by the period of higher prices in 2017-2019. That longer-cycle supply facilitated by OPEC+ restraint is just starting to come online, and the economics of those projects are such that they are not subject to delay for price-related reasons once they are started. Tensions were building between Russia and the Saudis even without the demand shock from COVID-19 because of Russia's unwillingness to equitably share the burden of restraint, which brought things to a head last week.
The Saudi move is also counterproductive in that U.S. shale production would have felt a major impact before the end of 2020 just from the lack of further production restraint, but would have bottomed out at a higher price, perhaps $40 per barrel. The difference between $30 and $45 as an average crude oil price is huge in terms of fiscal impact on producers but is not nearly as significant in terms of the volume loss that will be seen later this year from U.S. producers.
Russia's economy is going to take a major hit from the price collapse, but Moscow is in a much stronger position than Riyadh.
Russia's economy is going to take a major hit from the price collapse, but Moscow is in a much stronger position than Riyadh. Moscow has been accumulating reserves in its National Wealth Fund since 2017 at any price above $40 per barrel (with 2 percent annual inflation adjustment) and the most recent public data had the fund at $150 billion and cash reserves at $570 billion. Its budget balances with Brent in the mid-$40s, but drawing from the National Wealth Fund will help to cushion the blow if prices fall below that range. Russian President Vladimir Putin taken some criticism for implementing austerity measures and putting money away while oil prices were comfortable, but this now looks prudent. It reflects the fact that Putin accepts that the "lower for longer" price outlook is real and wanted to be prepared for precisely this type of shock.
The Saudis, on the other hand, are looking at a scenario in which the dividend payout they receive from Saudi Aramco will leave them obligated to finance roughly half of government spending from reserves and borrowing during the balance of 2020, with reserves of $502 billion. Their low debt-to-GDP ratio of 26 percent means that they can borrow, but that borrowing could become more expensive with renewed doubts about both future oil prices and the rationality and impulsiveness of Saudi policymaking. This, along with losses in the value of foreign investments held by the Public Investment Fund, will make it more difficult to maintain spending on Crown Prince Mohammed's Vision 2030 economic diversification program, which thus far has failed to make much progress generating increased private-sector employment for young adults despite ambitious stated goals. As with Putin, it would be politically difficult to admit having made a mistake and back down, since the only option on offer at present would probably be a continuation of current quotas, not any concessions from Russia.
All of this leaves the world facing an extreme level of uncertainty about where the oil market is headed, but it does not seem likely that we will see a sharp recovery in prices in the next few months.
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Third post
March 10, 2020 View On Website
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Oil Prices
By: George Friedman
Since before World War I and throughout the 1970s, the people who controlled oil had a lever for controlling others. Since the 1980s, the equation has shifted; oil producers have become dependent on oil consumers. Demand was always there, and then it started to vary and the political stability of oil producers also varied.
Geopolitical Futures’ forecast for 2020 was that there would be a global economic slowdown, whose effects would be intensified by dynamics kicked off by the 2008 crisis. We saw the 2008 crisis as being an exporters’ crisis, in which countries dependent on exports, particularly China, had been badly hit by the decline of global demand for manufactured goods, and exporters of raw materials, particularly Russia and Saudi Arabia, were hurt by the decline of demand in manufacturing countries like China. Our view of 2020 was that a routine business cycle would resurrect those pressures.
We did not anticipate the coronavirus, nor the global panic, particularly the disruption of the Chinese economy. We predicted that the Chinese economy would be disrupted as a result of a decline in global demand, and this would be followed by a decline in oil prices. The result would be increased global political stress, particularly on oil producers. Energy accounts for 30 percent of Russia’s gross domestic product and 60 percent of Russia’s exports. It accounts for 50 percent of Saudi Arabia’s GDP and 70 percent of its exports.
The political consequences of the global slowdown, according to our forecast, would be most intensely felt by countries most dependent on energy production. The second tier of countries that would be most affected were those most dependent on exports, led by China and Germany, which relies on exports for nearly 50 percent of its GDP. These countries would face internal political turbulence as the decline affected internal economic systems, and social systems as a whole.
European countries have seen contractions in their economies, or declines in growth. China was under heavy economic pressure before the U.S. imposition of tariffs, and was facing instability in Hong Kong and Xinjiang. Russian President Vladimir Putin had imposed a radical new model for Russian governance and was obviously sensitive to weakness in oil prices, which could not return to the high prices that had previously fueled the Russian economy. The United States is the strongest economy in the world, partly because among the major economies it is least dependent on exports, which account for about 13 percent of GDP, with nearly half going to Canada and Mexico. What is happening is in outline what we expected: China is staggering, triggering a decline in oil prices, and the U.S. is slowing but not going into crisis.
The question now is what the effects of the decline of oil prices will be on Saudi Arabia and, most important, Russia. The economic consequence has to be substantial. Russia has reserves, and it has claimed that the Russian system would continue to function well with oil as low as $40 per barrel. At the time of writing, the price is below that level, and reports of serious economic stringency, especially outside of Moscow and St. Petersburg, were rampant even before this crisis. More important, when the Russians speak of reserves, they are speaking of their national budget. That budget is a vital part of their economy but far from all of it. The budget may have some buffering, but the rest of the economy is highly vulnerable to the impact of low oil prices.
Russia is a major power, and as with the Soviet Union, which was difficult to read until it collapsed, economic instability in Russia is significant globally. Many have argued that the Soviet Union collapsed because of low oil prices and high defense spending. I think these were contributing factors but not decisive. We are seeing those forces at work now as well. This also explains why the Russians were not prepared to cut oil production when the Saudis demanded it. The Russians simply could not absorb the cost of stabilizing the price of oil. It is not clear that the Saudis can either, but their global significance, once massive, has declined greatly since the 1970s, and even Saudi Arabia’s regional power is limited. Whether the Saudis miscalculated, acted out of domestic pressures, or now expect the Russians to limit the damage on them by aligning with the Saudis is unknown, but the damage to the global economy is intense and has been inevitable for some time. It is the speed that is unique and damaging.
There have been analyses arguing that the Russians engineered the decline in prices to hurt U.S. shale producers. Given that it was not Russia but Saudi Arabia that engineered the decline (Russia was resisting the Saudi price cut), this would be Russia cutting off an American finger while cutting its own throat. The Russians are enormously more dependent on higher oil prices than the Americans are. Texas oil will be hurt, but that is a fairly small part of the American economy, and nowhere near the 30 percent of Russia’s economy.
The economic and political question surrounding the coronavirus is how long it will take to normalize its presence. The virus is new and frightening. It is likely not going to disappear. If it does not, it will be integrated into expectations around the world. As with other diseases, some people will get it and some will die. Shutting down the movement of people and goods and slashing economic output will likely produce net negative results greater than the coronavirus. Unless it appears that it has the characteristics of the Black Death, it will become part of the panoply of diseases like tuberculosis, Lyme disease or malaria that the world lives with. The arrival of treatments and vaccines will of course speed this up.
The question then is what the economic damage will be, and therefore what the political damage will be. China is the fulcrum of the issue, and its problems go beyond the coronavirus. It is also the largest importer of oil in the world. As its economy weakens, oil prices will decline. And with the decline of oil prices, oil exporters will face serious economic problems, and political tension as their economies weaken. The coronavirus did not cause this. It did, however, intensify the time frame dramatically.
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Classic trade war behavior. You shot a hole through your own boat and are taking on water. I retaliate by shooting two holes in my boat. Friedmavn: "this would be Russia cutting off an American finger while cutting its own throat."
Putin is constrained only by his own assets and resources, but I highly doubt the Saudi Princedom will sacrifice its relationship with the US over this. I can't find a link but understand that Trump and MBS are in communication.
Also hurt is Iran? Too bad.
The US oil business is not going out of business forever because of this feud. These two major players cannot force the rest of the world out of the market.
Don't high energy prices cause a slowdown? What happened to the theory that a low oil price is an economic stimulus - for the world?
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https://www.washingtonexaminer.com/opinion/coronavirus-oil-panic-will-help-prove-predatory-pricing-doesnt-work
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March 12, 2020 View On Website
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The Implications of an Oil Price Crash for Russia
By: Ekaterina Zolotova
It’s turning out to be a tough week for the world’s major oil producers, especially Russia. After Moscow refused to agree with OPEC members on production cuts to try to stem declining oil prices, the price of Russian Urals crude, which is sold on average for $1.5-$2 less than Brent crude, plummeted this week, reaching $31.4 per barrel on Tuesday, its lowest level since January 2016 when it was at $30 per barrel. The Russian ruble, in turn, fell to 72.5 rubles to the dollar and 82.7 rubles to the euro. When the Moscow Exchange opened on Tuesday, the value of Russian oil companies had fallen by 1.6 trillion rubles. Lukoil estimated that Russia would lose $100 million to $150 million daily as a result of failing to reach an agreement with OPEC. The Russian economy will clearly feel the effects, but there will likely be consequences for Russian society and foreign policy as well. This raises a critical question: How prepared is Moscow, really, for an oil price crash?
(click to enlarge)
Despite the Russian government’s desire to reduce the country’s dependence on oil, Russia’s economy remains highly reliant on revenue from the energy sector. In fact, a recent analysis by Russia’s statistics agency, Rosstat, found that the Russian economy's dependency on raw materials industries actually increased from 2010 to 2018. In January, oil and natural gas accounted for nearly 40 percent of the federal government’s revenue. The plunge in the price of Urals crude, therefore, is bound to have an impact on the Russian economy.
(click to enlarge)
But even before the failure to reach an agreement with OPEC, there was plenty of uncertainty around oil prices in Russia for several reasons. Prior to this week, oil prices had fallen 17 percent since the coronavirus outbreak began due to low demand from China and increased supply. In addition, Russia’s ongoing dispute over oil prices and supplies with Belarus, a country to which Russia delivers roughly 1.5 million tons of oil per month and had planned to increase deliveries to 2 million tons per month, led to oversupply in Baltic ports and Russian refineries. Furthermore, Moscow is anticipating a potential drop in demand for Russian energy in Europe, the largest buyer of Russian oil, because of ongoing repairs to European refineries, tougher environmental standards for marine fuels and increased competition in European markets from other oil suppliers hurt by declining Chinese demand.
Due to this combination of factors, Urals crude is now priced below the value projected in the 2020 budget, $42.40 per barrel. The government can survive with oil at this price, but its ability to replenish its reserves will be severely restricted. Russia introduced in 2018 a mechanism designed to reduce the economy’s dependence on energy and create a reliable source of cash during times of shortfall. According to this mechanism, all revenues from oil and gas sales when prices are above the base value are directed to the National Wealth Fund. So long as prices remain below $42.40, therefore, that fund will not receive any new infusions.
Beyond the price used to regulate contributions to the NWF, Russia has also outlined additional tiers for oil pricing that it uses for economic planning purposes. One key tier is called the “risk scenario” tier. For 2020-22, Russia’s central bank set this category at $20-$25. Under this scenario, it was anticipated that the Russian economy would face recession, gross domestic product would fall by 1.5-2 percent and, for 2020, annual inflation would grow to 6.5-8 percent (in 2019, it was 3.2-3.7 percent). The Ministry of Finance also said this week that if oil prices drop to $25-$30 prices for a year, oil and gas revenue for the budget will decline by 1.6-2.4 percent. The decline would be 5-7.6 percent if that price were sustained for three years.
The risk scenario also anticipates a fall in the value of the Russian currency to 80-90 rubles to the dollar. As a result, the total amount of rubles accumulated in the budget from oil and gas sales would actually increase, which would lead to increased spending that could be financed by funds from the NWF. The risk scenario also anticipates a decrease in Russia’s international reserves due to the sale of foreign currency that may result from oil prices dipping below the base value. According to the central bank’s projections, however, the economic slowdown would be short-lived; even under these circumstances, the economy can be expected to move toward recovery and grow by 1-2 percent in 2021, and by 3.5-4.5 percent in 2022.
Generally speaking, the current situation will not cause a complete collapse of the Russian economy. Clearly, Russia has considered the possibility of a steep fall in oil prices and planned for such a scenario. And on Monday, the Russian Ministry of Finance announced that it would sell foreign currency to try to boost the ruble after its value plunged following the oil price crash.
The government has also made clear that Russia has sufficient reserves to avoid a federal budget deficit. On Feb. 20, the NWF had reached 7.84 trillion rubles (equal to 6.9 percent of GDP), and according to Ministry of Finance estimates, it will reach 10 trillion rubles in March. The government is allowed to spend funds from the NWF in two cases: if oil prices drop below the baseline value, and if the fund reaches 7 percent of GDP. If reserves increase above 7 percent of GDP, the government can use the funds to invest in things like infrastructure. In addition, Russia’s accumulated foreign reserves currently stand at $570 billion, which is enough to cover costs for at least three years during an oil price slump. The Ministry of Finance said on Monday that Russia has sufficient reserves to sustain the country’s finances for six to 10 years if oil prices fall to $25-$30 per barrel.
(click to enlarge)
Furthermore, maintaining the level of production for Russia is no less important than oil prices. Today, taxes on mineral extraction make up a growing share of the federal budget. In January 2020, revenues from oil production accounted for 25 percent of total revenues, while export duties from oil exports formed only 5 percent. And since the tax rate is constant – it is set in rubles per 1 ton and later multiplied by a coefficient reflecting world oil prices – the important thing for Russia’s budget is that production volumes increase. Because of the collapse of the OPEC+ agreement, all restrictions on production will be lifted beginning in April, meaning Russia can increase production. For Russia, this means developing oil fields where commercial production has not even begun: for Lukoil, in the Filanovsky and Grayfer fields in the Caspian; for Gazprom Neft, in East Messoyakhskoe on Yamal and Kuyumbinskoye in northern Krasnoyarsk region; and for Rosneft, in West Erginskoye in Ugra and Suzunskoye in Eastern Siberia. In fact, Rosneft contends that the OPEC+ deal was “meaningless” for Russia, forcing the company not to develop its own projects and clearing space for American shale oil, because all the volumes of oil that were not produced because of the agreement were quickly and completely replaced on the world market with American production.
Moreover, a weaker ruble as a result of the drop in oil prices may work to Moscow’s benefit. According to the Ministry of Finance’s calculations, each deviation by one ruble from the forecast of 65.7 rubles per dollar equates to a change in oil and gas budget revenues in 2020 of 70 billion rubles. In other words, the federal budget might expect some additional income from a weakening ruble.
Low prices may be an opportunity for Russia to put energy disputes such as that with Belarus behind it. Minsk is already considering the fall in world oil prices as an opportunity to conclude an agreement with Moscow on the supply of oil to the republic. This is quite timely, because if Russia and Belarus do not agree within a month, the situation with Urals prices will get worse: April and May is generally the time of year when Russian refineries focus on repairs, which means that it will be much more difficult at that time for oil companies to process additional volumes of oil. Simply put, the price of Urals production will be more unstable and could fall even lower than in the dire scenario prepared by the central bank.
However, in any scenario where oil prices are lower than $42.40 per barrel, the NWF will most likely be spent to cover the emerging budget deficit – and fewer funds will be directed to finance the social initiatives that President Vladimir Putin outlined in his message to the Federal Assembly in January.
These federal initiatives are considered key elements of developing the Russian economy and improving living standards, but more than half the projects are less than 20 percent complete, and doubts have been raised about the effectiveness of implementation. Since the Russian government needs large-scale social projects that require large investments in order to stimulate economic growth, it is in the government’s interest to have a constant budget surplus.
But in recent years, the improvement in living standards has stalled, particularly because of falling oil prices. Rising inflation will also put pressure on Russian citizens. The government’s plan to reduce poverty to 10.8 percent will be impossible to fulfill with falling oil prices, and in fact the situation of almost half of Russians may worsen. About 14 million Russians live below the poverty line, about 20 million have incomes below the subsistence level, and small business does not develop effectively due to the lack of domestic demand. Further impoverishment of the population may also reduce the birth rate, which the government is so desperately trying to raise. If oil is already below the budgeted price, the Putin government simply will not be able to fulfill its political promises, and the real incomes of people will continue to fade.
The Russian government has prepared for the most severe scenario. Russia will be able to cope with oil below $30 per barrel, but only by sacrificing its budget surplus, its rainy day funds and its political promises to raise living standards. This sacrifice will mean the government cannot solve long-standing social problems and will lose the trust of the people. There is only one price that the Kremlin considers acceptable, and that is above $42.40 per barrel.
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Steve Hayward and Mark Mills on the oil price war and Coronavirus.
https://www.powerlineblog.com/archives/2020/03/the-power-line-show-ep-172-breaking-down-the-oil-price-war-and-the-coronavirus-with-mark-mills.php
I found this to be worthwhile.
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As Oil Prices Plummet, Russia and Saudi Arabia Dig in for a Long Fight
Greg Priddy
Greg Priddy
Director, Global Energy and Middle East, Stratfor
10 MINS READ
Mar 18, 2020 | 10:00 GMT
A photo of a pump jack extracting crude oil from a snow-covered well located near Surgut, Russia.
A pump jack extracts crude oil from a well near Surgut, Russia.
(Alexei Andronov\TASS via Getty Images)
HIGHLIGHTS
Crude oil prices are likely to dip further in the second quarter of 2020 and stay at depressed levels due to the ongoing price war between Saudi Arabia and Russia.
Saudi Arabia will continue to ramp up its oil output and keep prices low in an effort to coerce Russia into scaling back its own production amid coronavirus-related drops in global demand.
This strategy, however, is unlikely to be successful, as Russia's unwillingness to cut production reflects its longstanding concerns about loss of market share, as well as its much more pessimistic view of the market compared with Saudi Arabia.
As global prices plummet, Saudi Arabia's financial reserves will burn at a much more rapid pace than Russia's due to the disparity between the two countries' fiscal breakeven points on crude prices.
Despite mounting fears of coronavirus-related drops in global oil demand, Saudi Arabia recently signaled its intent to flood the market with even more discounted exports following Russia's rejection of proposed OPEC+ production cuts. In doing so, Riyadh is hoping to force Moscow back to the negotiating table, though such a gamble is almost sure to backfire — and badly.
For one, Russia has long been wary of shrinking its oil output for fear of also shrinking its market share, and is thus unlikely to quickly cave to Saudi Arabia's demands. And compared with Riyadh, Moscow also has more cash reserves to ride out a period of low prices. Saudi Arabia's oil-dependent economy, on the other hand, will be among those hardest hit from the very price cuts to it's now willingly helping to exacerbate.
The Big Picture
The increasing number of quarantine procedures and travel restrictions due to the coronavirus pandemic could deplete global oil demand in the near-term. But following the dramatic collapse of cooperation between OPEC and non-OPEC allies (known as OPEC+), global production is still expected to rise sharply by April, leaving the oil market to reckon with simultaneous supply and demand shocks.
See Energy
Russia's Rationale
Following Russia's recent falling out with Saudi Arabia on production cuts, the meeting of the OPEC+ Joint Technical Committee scheduled for March 18 — which Russian officials had previously said they would attend — was canceled. Russian Energy Minister Alexander Novak then put the nail in the coffin on March 13, telling Russian state media that Moscow sees no basis for returning to negotiations with its former OPEC+ partners. Russia’s decision to pull out was precipitated by the Saudi-driven ultimatum to back a 1.5 million barrels per day (bpd) of production cut through the end of 2020. But in many ways, Moscow's response was a long time coming, and reflects its focus on market share and long-term revenue maximization.
Russian commitments to production cuts under the OPEC+ framework has never exceeded 300,000 bpd. Saudi Arabia, by contrast, has consistently overperformed on its obligations since the initial December 2016 agreement on production restraint. Compared with Saudi Arabia, Russia has also often taken longer to implement cuts. As a result, Russia has largely maintained its volume in recent years, and even benefited from the 2017-2019 price surge, while failing to bear anywhere near a proportional share of the burden — a trend that has increasingly frustrated Saudi Arabia. In fact, Russian production of hydrocarbon liquids was actually higher in the first quarter of 2020 than it had been in December 2016.
Deputy Prime Minister Igor Sechin — who's also the CEO of Russia's state-owned oil giant, Rosneft — has vocally opposed participating in OPEC+ from the beginning, but was overruled by President Vladamir Putin. However, the Russian oil industry’s argument against ceding more of its market share has been strengthened since the prices for Brent crude oil futures surged past $70 in 2018. This resulted in U.S. production growth of more than 2 million bpd in 2019, offsetting demand for Russian crude (as well as the entirety of global demand growth). But U.S. shale isn't the only price-sensitive supply. Roughly half of the supply growth is now coming from outside the United States as well, mostly from deepwater projects in Norway, Brazil, and Guyana.
In mid-2019, Putin publicly opposed Saudi Arabia's push for higher prices, saying he viewed the $60-$65 range as "comfortable." Then in March, concerns about both slowing economic growth and the early development of the coronavirus pandemic dragged Brent prices down further to the $50 range in early March, which Russian officials including Putin repeated that they still remained comfortable with. It should thus perhaps come as no surprise that Moscow turned down the Saudi-led production cut proposal in the March 5-6 meeting between OPEC+ ministers.
Moscow's View of the Market
All of this suggests that the Russian leadership has accepted a pessimistic view of the current market and believes that prices need to spend some time below their equilibrium to temper higher-cost supply for both short-cycle shale and longer-cycle offshore products. The Russian government's position was recently made very clear by Deputy Energy Minister Pavel Sorokin. In an interview with Reuters, Sorokin said Russia intended to let market forces deal with the surplus, expecting initial signs of weakness in competing supply in four-to-six months. He also alluded to longer cycle offshore supply, saying that if Russia had agreed to the Saudi demand for a large OPEC+ cut, it would have led to investment decisions facilitating competing supply growth three-to-four years out. Surprisingly, he put forward the view that Russia's equilibrium is the $45-$55 per barrel range, which he said should be comfortable for producers and allow demand to recover.
In going this route, Russia is accepting a period of significant fiscal pain to maximize revenue gains in the long-term. Alexei Kurdin, the head of the Accounts Chamber of the Russian Federation, said that current oil prices would reduce government revenue by $42 billion, and that the price collapse and weakening of the ruble would force Russians into increasing poverty. As the parliamentary body that oversees financial control, the Chamber's forecasts tend to be more pessimistic than the Russian government's outlook, but are often more accurate.
The Russian Central Bank said it was better prepared and had higher reserves to deal with a price collapse now than it was during the 2014-16 collapse. With Russia’s main export oil blends, Urals, likely to remain below $41.62 per barrel for the remainder of the year, its foreign exchange reserves will take a hit. Social spending will suffer as a result, and Russia’s regional governments will deplete their reserves and be forced to borrow. But Russia's overall fiscal breakeven for Urals is in the mid-$40s. And this, combined with the fact that hydrocarbon exports make up less than 35 percent of overall government revenue, puts Russia in a stronger position than Saudi Arabia to take the pain of falling crude prices. But despite these Risks, Moscow has calculated that long-term revenues would suffer with the loss of market share due to production cuts. And that in the absence of an OPEC+ agreement, competitors will begin to change their investment decisions soon regardless, though most of the volume loss would likely be in 2021 after prices bottom out and begin to recover.
Saudi Arabia's Risky Gamble
Saudi Arabia also has a financial cushion to maintain its current standoff, with roughly $502 billion of reserves. But with Riyadh's fiscal breakeven at over $80 per barrel, lower oil prices will begin to drain those reserves much more quickly than Russia's reserves. The kingdom's 2020 budget was based on a 6.4% deficit with Brent crude oil prices at $65 per barrel. This has fueled Saudi Crown Prince Mohammed bin Salman's recent push for higher prices, as well as his willingness to take a losing gamble that Russia would cave to an ultimatum for a large cut once they were confronted with the prospect of a price collapse. But his decision to retaliate against Russia by slashing its oil prices and ramping up output risks backfiring, and badly.
The kingdom's state-backed oil giant Saudi Aramco announced it was cutting prices on March 7, and then pledged to supply the market with 12.3 million bpd of crude oil and petroleum products just two days later. That is more than the kingdom can actually produce each day based on Saudi Aramco's current infrastructure, despite claiming to have a capacity of 12.5 million bpd. But the move alone was enough to send prices tumbling. In response to OPEC+'s failure to reach a production cut agreement on March 6, Brent crude prices had closed at $46. But when after-hours trading resumed the night after Saudi Arabia announced its decision to increase production on March 7, it had dropped an additional $13 to $33.
This illustrates a part of the dilemma for Riyadh. Compared with Russia, Saudi Arabia finds the prospect of Brent prices recovering only to the $45-$55 range by late 2021 much less comforting. Of course, such a range is not ideal for Moscow either, but it is much more tolerable as Moscow is draining reserves at a slower pace and can hope to recover to their budget-balancing point in 2021. But as Saudi Arabia pounds prices into the ground, Brent futures could soon fall in the $20-$30 range.
If prices stay in the $30s or below for most of this year, Saudi Arabia will be forced to curtail social spending, as well as further delay the expensive projects under its already troubled Vision 2030 economic diversification program. For smaller producers elsewhere, this will drop prices below not just profitability but current operating costs, and forcing some competing supply offline. As oil demand falls, supply will eventually and dramatically contract elsewhere heading into 2021. But the inventory overhang will still prevent prices rising back to $60 while there is an inventory overhang, while Russian reserves would stabilize at $45-$50.
Possible Outcomes
This leaves a situation in which there are several plausible outcomes, with the most likely being that OPEC+ never reaches a deal to cut production and the physical market eventually corrects itself (as Russia anticipates). Within that scenario, Saudi Arabia's behavior becomes all the more crucial. Even without a formal deal with Russia, Riyadh could push OPEC or a smaller break-off group with other Gulf Arab nations to undertake a production cut, which would mean less financial pain for everyone, but particularly the Saudis, and a faster return to equilibrium. Such a cut could be done informally to avoid the appearance of capitulation, and could also still allow Riyadh the option of gradually taking more market share later on (though that would require keeping prices below $60 to prevent another resurgence of U.S. shale and other higher-cost production).
Saudi Arabia has underestimated just how long Moscow can endure low oil prices, which could come to its own detriment and that of other oil producers.
The alternate scenario is that the financial pain of dropping oil prices eventually brings both Saudi Arabia and Russia back to the table. A Russian capitulation and acceptance of the original Saudi-led OPEC proposal is unlikely, given that Russia clearly wants to avoid a feedback loop where production cuts yield a premature price recovery that ends up cutting into its market share. But that doesn't mean a smaller deal where the Russians commit to a modest cut and the Saudis again bear more of the burden isn't a possibility, or even a Russian capitulation and acceptance of the original Saudi-led OPEC proposal. Given the relative financial strength of both Moscow and Riyadh, this is perhaps the most probable outcome should Saudi Arabia and Russia reopen negotiations. Such a deal could try to jumpstart the market back to the $45-$55 range that Sorokin outlined, which would be a climbdown for the Saudis and a loss of face for Crown Prince Bin Salman, but it would lessen the burn rate on Riyadh's reserves.
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At some point you can't produce more oil once all the tanks, tankers and pipelines are full. Until then, have at it. Russia without money is a safer world for the rest of us.
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At some point you can't produce more oil once all the tanks, tankers and pipelines are full. Until then, have at it. Russia without money is a safer world for the rest of us.
Maybe. Is Iran? Desperate people do desperate things.
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At some point you can't produce more oil once all the tanks, tankers and pipelines are full. Until then, have at it. Russia without money is a safer world for the rest of us.
Maybe. Is Iran [safer going broke]? Desperate people do desperate things.
Really good point. I guess I meant more harmless long term without resources, not for the next military or terror move of a desperate dictator. It costs money for Iran to be the world leading state supporter of terror, to spread their evil across the Middle East and across the Atlantic. It amazes me to see the presence of Iran-backed Hezbullah in Brazil, Argentina for examples. It cost Russia money to prop up Castro and Chavez to oppose us all those years. The fall of the Soviet Union came out of not being able to compete with us economically. Now, coming out of this crisis, is the time to fly past all these rogue states including the Xi Jinping dynasty. But not if we go from number one oil producer in the world to having our businesses produce and our homes heated only when solar panels light up or wind turbines spin.
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March 27, 2020 View On Website
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Why Saudi Arabia’s Oil Price War Won’t Work
By: Caroline D. Rose
For nearly three years, since the 2016 oil market crash and the U.S. shale boom, Russia and Saudi Arabia worked together to stabilize global oil prices as part of the OPEC+ alliance. But it seems this partnership is now on the brink of collapse. As the coronavirus pandemic threatens to shutter businesses, ground airlines and put a massive dent in consumer spending, demand for fuel has sharply declined – especially with the world’s top oil importer, China, being among the countries most affected by the outbreak early on. With a vaccine for COVID-19 at least a year away, there are few signs that demand will recover any time soon. Earlier this month, OPEC members urged producers to curb output, but one country refused to toe the line. Russia resisted OPEC’s call to cut production by 1 million barrels per day, hoping instead to take advantage of other producers’ willingness to do so. In response, Saudi Arabia has deployed a strategy of brinkmanship, announcing that it would increase output by 2.5 million bpd in April to drive prices down and force Russia into compliance.
The Saudi strategy is twofold. It’s attempting to lower prices to attract customers who are willing to stockpile supplies. At the same time, it’s hoping low prices will squeeze Russian finances and force Moscow to surrender to OPEC demands. But this strategy will come at a high cost to the Saudis. It is forcing Riyadh to draw more from its sovereign wealth fund than it had previously intended, drying up funds that it hoped to use to support its engagements abroad and to diversify its economy. The coronavirus crisis has highlighted countries’ prioritization of national interests over the collective, and the oil price war is no different. Russia and Saudi Arabia have raised the stakes to generate revenue, increase market shares and compete for dominance in the global oil market.
Can Saudi Arabia Keep Up?
The Saudi government has indicated that it is in a race to increase pressure on the Kremlin, cranking up production to nearly five times that of Russian crude output. But can it play the long game, balancing its budget at a lower price than Russia can? From its perspective, getting Russia to capitulate is a long-term objective, and one worth incurring revenue losses in the short term, because it will demonstrate that the Saudis really call the shots for OPEC+ members. Saudi Arabia believes its ability to produce oil cheaper than Russia ($8.98 per barrel compared to $19.21 for Russia) and larger global market share give it an advantage.
In reality, however, Riyadh may be forced to yield before Moscow. Saudi Arabia needs oil prices at $91 per barrel – more than three times the current price – to balance its 2020 budget. In contrast, Russia’s 2020 budget is based on oil priced at $42.40 per barrel, meaning that it can actually tolerate low prices for longer than the Saudis.
(click to enlarge)
Currently, Brent crude is at $28.70 per barrel, while Saudi Light is priced at $26.54. Some experts have predicted that prices could plummet even further to just $10 per barrel, as businesses big and small feel the fallout of the coronavirus crisis. Some observers believe the low prices could lead to a 2-4 percent decline in Saudi Arabia’s gross domestic product. Even with the country’s reserves – some of the largest in the world, with assets worth $320 billion – current prices are unsustainable, particularly given that the crisis could last eight months to a year. True, this isn’t Riyadh’s first time facing a crash in oil prices; it has managed to manipulate the market to its advantage during other times of crisis. During the oil surplus in the 1980s, it reduced its own production to try to keep prices high. It also manipulated the market in 2014 to counteract the U.S. shale boom. But in the current environment, increasing demand will be far more difficult, especially as the pandemic and an oncoming recession paralyze importers and sectors dependent on fuel. Even stimulus packages worth billions of dollars may not be enough to produce a surge in energy demand. They may help keep some companies and industries afloat, but they likely won’t produce an immediate and prolonged spike in oil sales.
In addition, Russia’s energy sector is showing no sign of slowing down. In fact, the country has increased its output by 500,000 bpd – half of Saudi Arabia’s own increased output – proving it can weather the storm. Furthermore, the Kremlin said it had enough cash to get through six to 10 years of oil prices between $25 to $30 per barrel. Russia will take a hit, of course, but in the long term its outlook is more optimistic than Saudi Arabia’s.
Domestic Considerations
Even before OPEC+ negotiations collapsed, Riyadh anticipated declining demand. The Saudi Finance Ministry asked government agencies to cut spending by 20-30 percent at the beginning of March in anticipation of a crash in prices. Now, with the coronavirus pandemic and the ongoing price war, Saudi Arabia has pumped the brakes even harder on spending. Last week, the government announced it would slash its 2020 budget by 5 percent, or 50 billion riyals ($13.2 billion). The government said the cuts would have no socio-economic impact, but the reality is that most of the cut funds were intended for projects in its non-oil sector.
As oil demand wanes further and prices fall, Riyadh will have to draw more money from its Sovereign Wealth Fund than it originally intended – funds that were meant to support long-term objectives, like its involvement in Yemen’s civil war, countering Iran’s expansion in the Middle East and diversifying its economy. Despite reduced spending, Saudi Arabia is still looking at a $61 billion deficit for this year, according to some experts, as revenue falls short of the government’s 2020 projection ($210 billion) and spending hovers around $270 billion. And the country is simultaneously facing another challenge: domestic control.
(click to enlarge)
Over the past few weeks, members of the royal family and activists alike have criticized Riyadh’s management of the coronavirus crisis, despite the fact that Saudi Arabia has not been hit as hard by the outbreak as many other countries, registering about 1,000 confirmed cases so far. The government’s decision to suspend prayer at mosques in Mecca and Medina, Islam’s two holiest cities, has undermined its credibility as the guardian of the Islamic faith and sparked concerns in the Islamic community that the coronavirus threat will continue well into the summer and force the government to shut down the hajj pilgrimage, which is set to take place in July and August. This, too, carries serious economic consequences; the hajj brings 2.5 million visitors to Saudi Arabia every year and just over $12 billion in revenue, accounting for about 20 percent of the country’s non-oil economy.
Though the royal family still has a strong grip on power, public frustration with low oil prices could test the Saudi leadership. Approximately 20 percent of the country’s population holds shares in Saudi Aramco, so low oil prices resulting in part from Riyadh’s efforts to force Russia to capitulate could lead to widespread anger – even dissent. This could intensify if a recession emerges in Saudi Arabia, where unemployment has been high since 2015, reaching roughly 12 percent at the end of 2019.
Most important, the price war will put at risk Saudi Arabia’s most vital domestic objective of the first quarter of the century: reducing its dependence on oil through the Vision 2030 campaign. In 2016, the country promised it would be able to “live without oil” by 2020. But 2020 has arrived and Saudi Arabia remains reliant on energy – even more so now that the price war is chipping away at funds intended for investment in non-oil industries. Crown Prince Mohammed bin Salman has touted Vision 2030 as a strategy to diversify the economy, bolster the private sector, increase social spending and reduce unemployment to 7 percent. But Vision 2030 has been hampered by declining oil prices and has struggled to attract foreign investment. The current price war will only exacerbate these problems.
Both Russia and Saudi Arabia acknowledge that this game cannot last; one or the other will succumb to the fiscal pressure and slow down production. Neither country wants to be the first to do so, however. For MBS, the pressure to mitigate the ripple effects of low prices while also keeping the heat on Russia is mounting. Winning the price war is critical to Saudi Arabia’s credibility, both at home and abroad.
Geopolitical Outcomes
As the gap between Moscow and Riyadh widens, there have been broader effects on the oil market and other producers. One of the unintended victims of the price war has been the U.S. shale industry. Producers have already begun to slash spending, prevent share buybacks, furlough employees and announce service discounts to stay afloat. By the beginning of this week, WTI shed 60 percent of the value it had accumulated since the start of this year. There is now talk of a wave of bankruptcies as debt accumulates and write-downs skyrocket. Regulators in Texas are beginning to consider curbing production – for the first time in 50 years.
But new opportunities have also opened up. The U.S. has tried to convince Saudi Arabia to ease up and even publicly acknowledged the possibility of a U.S.-Saudi oil alliance. That acknowledgment came after reports that some U.S. energy officials were interested in establishing an agreement with the Saudis to stabilize prices. Such an alliance would inevitably act as a counterbalance to Russia’s oil industry.
Washington already appears to be making attempts to align closer with the Saudis. On Monday, the U.S. fast-tracked the appointment of Victoria Coates as a special energy representative to Saudi Arabia. The U.S. also announced plans to dispatch Coates to Riyadh for the next few months for negotiations with Riyadh. There has also been talk of the U.S. potentially arranging a meeting with Saudi leaders to convince Riyadh to match cuts made by the United States.
As it stands, the road to recovery is long. Saudi Arabia, unable to set prices or increase demand, is running out of options and adopting a series of risky moves, hoping that it can either force Russia to capitulate or find new partners with which to navigate the oil market. OPEC+ as a price control regime is fragmenting, and Saudi Arabia is increasingly unable to sustain its pressure campaign on the Russian energy industry. And as the coronavirus crisis intensifies and a global recession looms, it will become even more difficult for the Saudis to coerce the Russians into compliance.
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https://netpower.com/
If Natural gas can be Carbon Zero, why do democrats want to ban fracking? Maybe they don't read the forum [or anything else].
https://www.bloomberg.com/news/articles/2018-07-03/this-power-plant-has-cracked-carbon-capture
https://www.powermag.com/300-mw-natural-gas-allam-cycle-power-plant-targeted-for-2022/
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To be fair, there are concerns about contamination of the water table.
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https://scottgrannis.blogspot.com/2020/04/oil-prices-actually-have-not-collapsed.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+blogspot%2FtMBeq+%28Calafia+Beach+Pundit%29
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https://www.foxbusiness.com/markets/texas-oil-rich-lands-chinese-takeover-weakened-crude-producers
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https://www.powerlineblog.com/archives/2020/04/civil-war-on-the-left-michael-moore-against-the-greens.php
Shockingly, some amazingly important points are made here and it is all done without any of the familiar voices of the right.
If you care about the earth, if you care about carbon dioxide, this isn't the way to do it. Is anyone listening?
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https://www.nature.com/articles/nclimate1451
Richard York, University of Oregon
"each unit of electricity generated by non-fossil-fuel sources displaced less than one-tenth of a unit of fossil-fuel-generated electricity"
- Who knew?
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"Populations of migratory river fish around the world have plunged by a “catastrophic” 76% since 1970, an analysis has found. The fall was even greater in Europe at 93%, and for some groups of fish, with sturgeon and eel populations both down by more than 90%. Species such as salmon, trout and giant catfish are vital not just to the rivers and lakes in which they breed or feed but to entire ecosystems. By swimming upstream, they transport nutrients from the oceans and provide food for many land animals, including bears, wolves and birds of prey. The migratory fish are also critical for the food security and livelihoods of millions of people around the world, while recreational fishing is worth billions of dollars a year. The causes of the decline are the hundreds of thousands of dams around the world, overfishing, the climate crisis and water pollution."
(via The Guardian today)
Of course the obligatory climate change, liberal source, but dams were listed first, hundreds of thousands of dams. Water pollution has not been getting worse for 50 years. We are back to dams and over-fishing.
Not mentioned, some of the 'migratory' fish we want stopped, jumping Asian carp for example.
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WSJ
Kamala Harris in Wednesday’s debate declared that Joe Biden’s Administration would make the U.S. “carbon neutral” by 2035—a more ambitious goal than even California has set—while at the same time disavowing plans to ban fracking for natural gas. We look forward to Mr. Biden explaining this apparent contradiction in the next debate, if there is one.
Meantime, it’s worth highlighting a new Energy Information Administration report that shows how fracking and competitive energy markets have done more to reduce CO2 emissions over the last decade than government regulation and renewable subsidies. Vice President Mike Pence made this point on Wednesday night, and he’s right.
According to the report, energy-related CO2 emissions in the U.S. fell 2.8% last year as many utilities replaced coal and heating oil with less expensive natural gas. Hydraulic fracturing combined with horizontal drilling has unleashed a gusher of natural gas production in the Midwest and Southwest. As a result, natural gas prices have plunged, putting many coal plants out of business.
CO2 emissions from coal declined by more than 50% from 2007 to 2019, the report notes, and by 15% in 2019 alone. Between 2016 and 2019 the share of electricity generated by natural gas rose to 38.1% from 33.7% and by non-carbon generation (including nuclear and hydropower) to 38.2% from 35.5%. Coal generation during this period plunged to 23.3% from 30.3%.
Increasing power generation from natural gas has accounted for 60% of the country’s decline in CO2 emissions from electricity since 2010. The carbon intensity of the country’s energy declined at about the same rate during the first three years of the Trump Presidency as from 2009 to 2016.
The International Energy Agency earlier this year reported that the U.S. “saw the largest decline in energy-related CO2 emissions in 2019 on a country basis” due to a 15% reduction in the use of coal for power generation and “US emissions are now down almost 1 Gt [gigatonne] from their peak in the year 2000, the largest absolute decline by any country over that period.”
To sum up: President Trump pulled out of the Paris Climate Accord and eased the Obama-Biden Administration’s economically destructive climate regulations, and the U.S. is still leading the world in CO2 reductions.
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Another Green Subsidy Bust
An Obama-era solar failure could cost taxpayers $510 million.
By The Editorial Board
Dec. 11, 2020 6:41 pm ET
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Crescent Dunes solar plant in Nevada.
PHOTO: UNITED STATES DEPARTMENT OF ENERGY/SOLARRESERVE
Move over, Solyndra. Another green boondoggle from the Obama era has failed, and taxpayers are out as much as $510 million. Late last week Judge Karen Owens approved a Chapter 11 plan of reorganization by Tonopah Solar Energy. Tonopah operated the Crescent Dunes solar plant in Nevada that received $737 million in guaranteed loans from the Obama Administration.
The plan includes a settlement with the Department of Energy that leaves taxpayers liable for as much as $234.68 million in outstanding debt, but the total public cost is even higher. Crescent Dunes also received an investment-tax credit, and the 2009 stimulus legislation allowed it to receive a cash payment in lieu of credit. In 2017 the plant received more than $275.6 million from Treasury under the Section 1603 program, which it used to service its outstanding liabilities. So taxpayers already gave Crescent Dunes cash to pay off its taxpayer-backed loans.
This is one more cautionary tale in climate subsidies. The sun doesn’t deliver power when it’s cloudy or dark. Crescent Dunes promised to solve this problem by using molten salt to retain the heat from the sun and produce steam, so the plant would generate power 24/7.
But Crescent Dunes struggled to get financing from commercial lenders—not least because it was “the first of its kind in the United States and the tallest molten salt tower in the world,” as the Department of Energy gushed in a September 2011 news release.
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Uncle Sam still rushed in, and the problems soon began. Because of construction delays, Crescent Dunes missed its deadline to begin commercial operations. Equipment failures meant the plant generated no energy through the first half of 2017. Outages were so frequent that the sole buyer of its power, the utility NV Energy, told regulators that Crescent Dunes posed “the most significant risk” to its ability to meet its renewable portfolio goals.
DOE expected Crescent Dunes to produce up to 482,000 megawatt hours every year, but the plant hasn’t produced that much energy in its lifetime. In 2019 Crescent Dunes’s hot salt tanks suffered what partial owner SolarReserve described as “a catastrophic failure” that has left the plant inoperable.
The feds called Crescent Dunes a success until forced to admit it was a failure. As late as April 2017—when the plant was in the throes of a months-long shutdown—DOE pronounced it a “milestone for the country’s energy future” and a “success story” taken from “mirage to reality.” But in August spokeswoman Shaylyn Hynes admitted that “this project has consistently faced technical failures that have proven difficult to overcome."
Under the settlement, taxpayers could recover up to $100 million if the plant can resume operating and meet milestones for energy production and revenue. Don’t count on it. In 2019 NV Energy terminated its power purchase agreement, so now Crescent Dunes doesn’t have a buyer for its power, which is far more expensive than what other renewable-energy plants in Nevada charge.
The Crescent Dunes failure shows again what happens when government invests in commercial ventures beyond its expertise for political purposes. Scarce resources are misallocated and taxpayers lose. We wish we could say the politicians have learned from failure, but the Biden Administration is coming to town promising much more of the same.
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"Tonopah operated the Crescent Dunes solar plant in Nevada that received $737 million in guaranteed loans from the Obama Administration."
Can we round up the Obama administration and have them pay for their mess?
Note that this Obama Biden boondoggle has gone badly for 10 years but makes the news just after votes are cast.
Can we please learn to say no to anti-constitutional public-private-partnerships, sweetheart deals and all forms of crony governmentism?
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Asked in the bitcoin discussion, what is the cost of electricity anyway? Well, there is the cost of the electricity, and then there is the quadrupling of that, that comes from taxes, regulations and mandates, state and federal. The cost will most certainly be lower in a more free country.
https://neo.ne.gov/programs/stats/inf/204.htm#:~:text=States%20are%20ranked%20so%20that,electricity%20rate%20(7.71%20cents).
Rank State Average Electricity Rate
for All Sectors
(Cents per Kilowatthour)
1 Louisiana 7.71
2 Arkansas 7.78
3 Washington 8.00
4 Oklahoma 8.09
4 Wyoming 8.09
5 Idaho 8.17
6 Utah 8.21
7 Texas 8.48
8 Kentucky 8.52
9 Nevada 8.67
10 West Virginia 8.72
11 Montana 8.84
12 Oregon 8.85
13 North Dakota 8.91
14 Iowa 8.92
15 Nebraska 9.02
16 Mississippi 9.24
17 North Carolina 9.25
18 New Mexico 9.35
19 Virginia 9.48
20 Tennessee 9.58
21 Illinois 9.60
22 Georgia 9.62
23 Alabama 9.63
24 South Carolina 9.66
25 Indiana 9.75
26 Missouri 9.93
27 Ohio 9.94
28 South Dakota 9.97
29 Colorado 10.02
30 Pennsylvania 10.10
31 Florida 10.31
32 Minnesota 10.37
National Average 10.53
33 Delaware 10.55
34 Wisconsin 10.58
35 Kansas 10.72
36 Arizona 10.85
37 Michigan 11.40
38 Maryland 11.57
39 District of Columbia 12.03
40 New Jersey 13.23
41 Maine 13.44
42 New York 14.83
43 Vermont 15.13
44 California 16.58
45 New Hampshire 17.01
46 Rhode Island 18.10
47 Connecticut 18.41
48 Massachusetts 18.50
49 Alaska 19.36
50 Hawaii 29.18
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More perspective here:
https://www.americanexperiment.org/2019/11/three-things-xcel-energy-doesnt-want-you-to-know-about-their-massive-increase-in-electricity-prices/
"More rate increases are coming, and they could increase electricity bills by $580 per year."
https://www.americanexperiment.org/2019/11/our-perspective-minnesotas-days-of-cheaper-electricity-seem-numbered/
Center for the American Experiment, John Hinderaker, President. Research emphasizes free enterprise, limited government, personal responsibility and government accountability.
Contribute here: https://www.americanexperiment.org/donate/?caid=70141000000uO9fAAE
I will match your donation.
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Biden says he wants to promote good-paying union jobs. And so, his first act in office is killing 20,000 good-paying union jobs connected to the Keystone pipeline. "
https://www.powerlineblog.com/archives/2021/01/cup-of-joe.php
https://www.seattletimes.com/business/work-on-keystone-xl-pipeline-suspended-ahead-of-biden-action/
-------Gas prices already up 20% in anricipation of Biden policies.
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https://thenationalpulse.com/news/biden-revokes-trump-energy-eo/
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Where have we heard this?
As Holman Jenkins points out in the Wall Street Journal today that if the Harris-Biden Administration was actually serious about climate change, they’d push nuclear power. Instead:
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A good first step might be to power the grid before making every vehicle and furnace electric.
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Just as the left believes that if you identify as a woman, that makes you a woman, if you identify as a country with a functional energy infrastructure, you are one!
Where have we heard this?
As Holman Jenkins points out in the Wall Street Journal today that if the Harris-Biden Administration was actually serious about climate change, they’d push nuclear power. Instead:
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A good first step might be to power the grid before making every vehicle and furnace electric.
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https://www.prageru.com/video/why-are-utilities-so-expensive/?utm_source=Main+Mailing+List&utm_campaign=4f88850cd9-EMAIL_CAMPAIGN_2020_04_09_06_29_COPY_01&utm_medium=email&utm_term=0_f90832343d-4f88850cd9-180767050
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U.S. Department of Transportation, pipelines are 451 times safer than rail transportation on a per-distance basis
https://journaltimes.com/opinion/editorial/journal-times-editorial-pipelines-are-safest-for-the-environment/article_f44cf4b3-3edb-53ec-b804-49b93f6dbbd6.html
Between 2011 and 2013, 99.999% of crude oil and petroleum products shipped via pipeline arrived safely at their destination
https://www.canadaaction.ca/shipping_oil_pipelines_vs_trains_which_is_safer
The horrible truth, and one might pray for the souls lost in July 2013 in Quebec, is train transport is far more dangerous. The Quebec train disaster killed at least 38 people, and counting. No pipeline failure has ever come close to this level of human death and suffering.
Even more dangerous is truck transport.
https://www.supplychain247.com/article/the_best_way_to_transport_petroleum_trucks_trains_or_pipelines
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https://pagetwo.completecolorado.com/2021/02/01/griffin-biden-energy-ban-an-economic-hammer-to-colorado/
... Colorado will lose a projected $35.5 billion in Gross Domestic Product over the next 20 years. The immediate impact is just as drastic. Between 2021-2024, Biden’s leasing ban will eliminate 5,172 jobs annually, wipe out $2.8 billion in oil and natural gas investments, $1.3 billion in production, $546 million in much-needed tax revenue and a whopping $1.6 billion in high-paying wages.
New Mexico extracts nearly half of its oil and 67% of its natural gas from leases on federal lands. Before the pandemic, tax revenue generated from oil and production overall comprised 20% of the state’s budget. With 62,000 jobs at stake, a federal leasing ban will be catastrophic for one of the country’s most poverty-stricken states.
Wyoming’s oil and gas economy is dependent upon federal oil and gas leases. A federal leasing prohibition will severely impact 51% of the state’s oil production and a whopping 92% of its natural gas production."
- 92% of their natural gas production banned in one executive order? What the hell are we supposed to heat our homes with, wind turbines??
Biden's Keystone XL pipeline cancellation is gut punch to small businesses
Small Nebraska communities already seeing 'less money coming in,' with crews out of work
https://www.foxnews.com/politics/biden-keystone-xl-pipeline-cancellation-gut-punch-small-businesses
- We've faced energy embargos before, from OPEC, destroying the economy of the 1970s and the Presidency of Jimmy Carter, known for the least popular ever, gas rationing at the pump. But this time it is from the enemy within.
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just wait till energy costs start increasing
wait till spring and when corona dies down
the left will ignore
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https://twitter.com/i/status/1354526622460891137
Emission free car. Watch until the end. 1 minute video.
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".Emission free car. Watch until the end. 1 minute video."
great video Doug!
where does the electric power come from ?
I dunno?
oh, it is 95 % coal! -> silence and looking like a horses ass
our climate Czar
terrific
all this ,
as we drive out our coal production
and turn the coal industry into an unemployment industry
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If you haven't seen Idiocracy, you need to.
It's supposed to happen in the future. It's happening now.
".Emission free car. Watch until the end. 1 minute video."
great video Doug!
where does the electric power come from ?
I dunno?
oh, it is 95 % coal! -> silence and looking like a horses ass
our climate Czar
terrific
all this ,
as we drive out our coal production
and turn the coal industry into an unemployment industry
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Second (stupidest) only to the coal powered EV is the new diesel powered one. Just buy a diesel car you idiots.
(https://i0.wp.com/www.powerlineblog.com/ed-assets/2021/02/generator.jpg?w=607&ssl=1)
https://www.powerlineblog.com/archives/2021/02/the-week-in-pictures-circleback-edition.php
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(https://i2.wp.com/www.powerlineblog.com/ed-assets/2021/02/144538663_10157599235741433_7475780234949435317_n.jpg?w=437&ssl=1)
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(https://i0.wp.com/www.powerlineblog.com/ed-assets/2021/02/145131325_10214193675475046_6491496801401940156_n.jpg?w=720&ssl=1)
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(https://i0.wp.com/www.powerlineblog.com/ed-assets/2021/02/145131325_10214193675475046_6491496801401940156_n.jpg?w=720&ssl=1)
https://www.scientificamerican.com/article/solar-farms-threaten-birds/
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Shut down US energy sources and become more dependent on China is the new, old strategy.
Biden’s EPA Nominee Admits Most Solar Panel, Electric Vehicle Parts Come from China
https://nationalfile.com/bidens-epa-nominee-admits-most-solar-panel-electric-vehicle-parts-come-from-china/
CULTUREPOLITICSGABTELEGRAMMINDSABOUTTVPODCASTSTOREDONATE
Biden’s EPA Nominee Admits Most Solar Panel, Electric Vehicle Parts Come from China
“What we find is most of the parts we want to install come from China”
Frank Salvato by FRANK SALVATO February 5, 2021
7
Joe Biden, China, Solar Panels
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President Biden’s pick to lead the Environmental Protection Agency (EPA) admitted during his confirmation hearing that the United States is at a distinct disadvantage in the clean energy market because most of the parts necessary for solar energy and green vehicles are made in China.
During his confirmation hearing last Wednesday, Michael Regan, Mr. Biden’s nominee to head the EPA, was questioned by Sen. Mike Braun (R-IN), about China’s complete disregard for the goals of green activists on the issue of climate change.
Regan referred to his time at the head of the State of North Carolina’s Department of Environmental Quality, admitting that while North Carolina is a leader in “solar installation,” most of the parts required for any installation are made in China.
“... I believe that’s the same for solar, as it is for cars.”
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Interesting thing happened the last 2 days. I tried to blow a dusting of snow off vehicles and walks with a (fully charged) 40 volt lithium battery powered blower at below zero temps and it failed. Looking up the operating temperature range for lithium batteries I see the range goes down to 50 degrees F. How doesvthat work for electric vehicles in extreme (or ordinary winter) weather? Will your new little ambulance or fire truck fail when you need it? Yes. Of course. It's physics.
My friends with Teslas have no problem. Call it triple decker wealth. They own a (taxpsyer assisted) tesla and they have heated garages (with charging) at home and at work, and don't leave the car outside for extended periods. We should all be so lucky. I assume the car has the ability to heat its own battery (what does that do to range?), but can not insulate it. That would trap battery heat in, an even more dangerous situation.
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I wouldn't own a Tesla or similar vehicles unless given one for free, maybe not even then.
They are fragile and unreliable and will be mostly worthless in the years ahead.
Interesting thing happened the last 2 days. I tried to blow a dusting of snow off vehicles and walks with a (fully charged) 40 volt lithium battery powered blower at below zero temps and it failed. Looking up the operating temperature range for lithium batteries I see the range goes down to 50 degrees F. How doesvthat work for electric vehicles in extreme (or ordinary winter) weather? Will your new little ambulance or fire truck fail when you need it? Yes. Of course. It's physics.
My friends with Teslas have no problem. Call it triple decker wealth. They own a (taxpsyer assisted) tesla and they have heated garages (with charging) at home and at work, and don't leave the car outside for extended periods. We should all be so lucky. I assume the car has the ability to heat its own battery (what does that do to range?), but can not insulate it. That would trap battery heat in, an even more dangerous situation.
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https://www.powerlineblog.com/archives/2021/02/wind-and-solar-energy-dont-work.php
WIND AND SOLAR ENERGY DON’T WORK
Leftists fantasize that before long, we can dispense with all reliable energy sources–coal, natural gas, nuclear, even hydro–and run our society entirely on wind and solar, two forms of energy that have been obsolete for 150 years.
How can this be, since wind turbines only produce electricity when the wind is blowing sufficiently, which is around 40% of the time, and solar only works when the sun is shining and the panels are not covered in ice and snow–in a northern climate, something like 18% of the time? Obviously the Greenies have a problem. Today, their problem is solved by building natural gas plants that carry the load when wind and solar are AWOL–which is to say, a large majority of the time. Of course, the natural gas plants are dispatchable, which means they can produce energy reliably, at will, 24/7. Which raises the obvious question: if we have to build fully-capable natural gas plants to make wind and solar sort-of work, some of the time, what the heck to we need the wind and solar for?
The truthful answer to that question has nothing to do with the laws of physics, and everything to do with the laws of money. But the Left has another answer: batteries! It looks forward to the day when batteries will store the output of wind turbines and solar panels and thereby turn unreliable, intermittent energy into electricity that you can count on to turn on your lights when you flip the switch.
At American Experiment.org, my colleague Isaac Orr demolishes the Green New Deal fantasy. One basic problem is that wind turbines don’t work when the weather gets cold, which can be fatal in the North, especially when we are experiencing a brutal cold snap:
Temperatures are below zero in many parts of the state, but wind energy is missing in action.
According to data from the regional grid operator, the wind is providing just 1 percent of the current electricity on the grid, and solar is providing just 0.31 percent. Coal currently accounts for 55 percent of generation, natural gas accounts for 28 percent, and nuclear accounts for 14 percent. {Doug: That is after all the wasted money on subsidies.]
Not only is wind not producing much electricity, but it is also producing only a small fraction of its potential output. There are 22,000 megawatts (MW) of wind capacity installed on the regional grid, but these wind turbines are only producing 1,055 MW of electricity. In other words, wind turbines are only producing 4.8 percent of their potential output. Temperatures are below zero in many parts of the state, but wind energy is missing in action.
As Isaac has explained elsewhere, the truth is even worse than that. When it gets cold, not only are wind turbines shut down so they produce no electricity, they also need to be kept warm. So in cold weather, wind turbines are consumers of electricity, not producers of electricity.
[More at the link. Batteries aren't going to solve this.]
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Cancelling Keystone Will Boost Carbon Emissions Equal to Nearly 500K More Cars on Road
https://www.cnsnews.com/article/national/quinn-weimer/report-cancelling-keystone-will-boost-carbon-emissions-equal-nearly
President Joe Biden’s cancellation of the permit for the construction of the Keystone XL pipeline, in the name of curbing climate change, will cause an enormous amount of CO2 to be released into the atmosphere, according to the Energy Equipment and Infrastructure Alliance (EEIA), because oil from Canada will still travel by diesel-fueled trains to U.S. refineries at the Gulf.
... a little basic math reveals that President Biden's Keystone decision will increase carbon emissions equal to putting nearly half a million more cars on the road,” said the EEIA in a press alert.
https://www.eeia.org/aboutus/about-one.cfm?category=Alerts&getone=yes&ID=590
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Also enriches and empowers Russia (and OPEC and Middle Eastern war). Does anyone remember when "Russian Collusion" was the biggest threat to the country.
Mostly it is a great big penalty on Americans. A self inflicted wound, and the problem is that the (elected?) perp is still stabbing us with additional, harmful energy policies.
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Biden's Climate Actions Will Cause Electricity Prices to Skyrocket, Experts Warn
https://neonnettle.com/news/14147-biden-s-climate-actions-will-cause-electricity-prices-to-skyrocket-experts-warn
Already have. Also see Germany.
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https://www.foxbusiness.com/energy/texas-electric-grid-operator-says-frozen-wind-turbines-are-hampering-states-power-output-report
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Natural gas furnaces need electricity to work. Propane furnaces need electricity. Electric heat needs electricity, who knew? The coldest weather generally follows winter storms.
Wind turbines don't work in low wind, no wind, high wind, ice storms, in high heat or in cold weather. Solar panels don't work with snow on them, don't work half the day, don't work at night, did we know that?
How about emergency cell phone use when the towers are without power or when yoy lose the last of your charge. You EV doesn't work if you left it outside here the last 10 days even if you could charge it. How about putting a charger on your gas powered car? Off.
We trust morons with our most important decisions.
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Some crazy people don't trust TPTB and plan for crisis...
https://www.foxbusiness.com/energy/texas-electric-grid-operator-says-frozen-wind-turbines-are-hampering-states-power-output-report
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Natural gas furnaces need electricity to work. Propane furnaces need electricity. Electric heat needs electricity, who knew? The coldest weather generally follows winter storms.
Wind turbines don't work in low wind, no wind, high wind, ice storms, in high heat or in cold weather. Solar panels don't work with snow on them, don't work half the day, don't work at night, did we know that?
How about emergency cell phone use when the towers are without power or when yoy lose the last of your charge. You EV doesn't work if you left it outside here the last 10 days even if you could charge it. How about putting a charger on your gas powered car? Off.
We trust morons with our most important decisions.
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Third world countries have unaffordable, unreliable power.
Why do we choose that? These people aren't stupid; they are dangerous. Do you want the ambulance to work when you need one and the hospital to be lighted, heated and open? What if ALL the things we do are important to us and we don't want government planners ordering blackouts or rationing our energy.
Becoming a third world country, from richest in the world, does not advance anything good.
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The cloud people don't care about the dirt people. Their gated communities are secure.
Third world countries have unaffordable, unreliable power.
Why do we choose that? These people aren't stupid; they are dangerous. Do you want the ambulance to work when you need one and the hospital to be lighted, heated and open? What if ALL the things we do are important to us and we don't want government planners ordering blackouts or rationing our energy.
Becoming a third world country, from richest in the world, does not advance anything good.
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https://www.texastribune.org/2021/02/16/texas-wind-turbines-frozen/
of course it calls it self "nonpartisan"
but :
https://mediabiasfactcheck.com/texas-tribune/
OTOH maybe the article is accurate
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https://www.texastribune.org/2021/02/16/texas-wind-turbines-frozen/
of course it calls it self "nonpartisan"
but :
https://mediabiasfactcheck.com/texas-tribune/
OTOH maybe the article is accurate
Wind is not to blame. People are to blame for believing it to be anything more than unreliable and subsidizing it and steering resources away from way better sources.
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https://calgaryherald.com/news/local-news/kenney-deeply-concerned-over-reports-biden-plans-day-1-order-rescinding-keystone-xl-permit
Jason Kenney, the premier of Canada’s oil-producing province of Alberta, didn’t hold much back in criticizing President Biden's decision to kill the Keystone pipeline. In a Zoom discussion on Wednesday to a Manhattan Institute audience, Kenney said Biden transition aides declined to even discuss the decision before it was announced on Inauguration Day: "That's not how you treat a friend and ally.”
https://calgaryherald.com/news/local-news/kenney-deeply-concerned-over-reports-biden-plans-day-1-order-rescinding-keystone-xl-permit
“The Obama State Department’s own analysis concluded that Keystone XL would actually reduce emissions, as the alternative will be to move this energy by higher emitting and less secure rail,” Kenney said.
He notes the insidious role of U.S. foundations and environmental groups in killing Keystone. “For 12 years, the Rockefeller and other foundations have delayed and now killed the pipeline," he lamented. “Did any of them ever attack the environmental record of Saudi Arabia, Russia, and Venezuela? No, but with the loss of Keystone you will be perversely buying more oil from them."
Liberals often complained of how the Trump Administration alienated our allies. But in less than a month Joe Biden has insulted and injured our staunchest ally.
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(https://mcusercontent.com/dc8d30edd7976d2ddf9c2bf96/images/e602cd92-a4e2-40d2-8d58-faeb56107956.jpg)
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At best, Canada is a frenemy, but a really weak one. The western provinces tend to be ok, but the eastern ones suck.
https://calgaryherald.com/news/local-news/kenney-deeply-concerned-over-reports-biden-plans-day-1-order-rescinding-keystone-xl-permit
Jason Kenney, the premier of Canada’s oil-producing province of Alberta, didn’t hold much back in criticizing President Biden's decision to kill the Keystone pipeline. In a Zoom discussion on Wednesday to a Manhattan Institute audience, Kenney said Biden transition aides declined to even discuss the decision before it was announced on Inauguration Day: "That's not how you treat a friend and ally.”
https://calgaryherald.com/news/local-news/kenney-deeply-concerned-over-reports-biden-plans-day-1-order-rescinding-keystone-xl-permit
“The Obama State Department’s own analysis concluded that Keystone XL would actually reduce emissions, as the alternative will be to move this energy by higher emitting and less secure rail,” Kenney said.
He notes the insidious role of U.S. foundations and environmental groups in killing Keystone. “For 12 years, the Rockefeller and other foundations have delayed and now killed the pipeline," he lamented. “Did any of them ever attack the environmental record of Saudi Arabia, Russia, and Venezuela? No, but with the loss of Keystone you will be perversely buying more oil from them."
Liberals often complained of how the Trump Administration alienated our allies. But in less than a month Joe Biden has insulted and injured our staunchest ally.
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https://pjmedia.com/news-and-politics/tyler-o-neil/2021/02/25/5-times-bidens-interior-nominee-refused-to-answer-basic-questions-on-energy-n1428182
According to data from the Department of Transportation,
https://www.fraserinstitute.org/research/safety-transportation-oil-and-gas-pipelines-or-rail
pipelines are the safest method, with 99.999997 percent of gas and crude oil moved safely through interstate pipelines.
https://empower.afpm.org/safety/are-pipelines-safe#:~:text=US%20Department%20of%20Transportation%20data,safely%20through%20interstate%20transmission%20pipelines.
Yet Haaland acted as though the question was extremely complicated and arcane.
“Do you believe truck and train traffic moving energy is safer than a pipeline or do you think pipelines are safer than truck and train traffic?” Lankford asked.
“Again, I wish I could answer that question. I don’t know what the question is, I haven’t seen those statistics,” Haaland said.
-----------------------
It's SO hard to be an honest leftist. Yes Senator, we know our policies to put people out of work. We want oil moved the least safe way. Frankly, we want you to pull into gas stations across the country and see "out of gas" signs as soon and as often as possible.
What did Biden / Dem voters think was going to happen??
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Wish I could size this chart better.
The grid in Texas is not "winterized"
The subsidies go to the least efficient, least reliable sources.
Nuclear energy performed best, by far! Strangely, that is the most carbon free!
What did we learn from that? NOTHING! Do more of the same.
Wind and solar performed worst - when needed most. As always!
DOES ANYBODY CARE?
Best analysis comes from the Center for the American Experiment:
https://www.americanexperiment.org/2021/02/wind-energy-fails-grading-the-reliability-of-energy-sources-during-the-texas-power-outages/
Donate here:
https://www.americanexperiment.org/donate?caid=70141000000uO9fAAE
The chart:
(https://2lffqo2moysixpyb349z0bj6-wpengine.netdna-ssl.com/wp-content/uploads/2021/02/TEXAVG-1-1536x843.png)
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https://www.cnsnews.com/article/national/quinn-weimer/report-cancelling-keystone-will-boost-carbon-emissions-equal-nearly
Who knew?
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https://www.cnsnews.com/article/national/quinn-weimer/report-cancelling-keystone-will-boost-carbon-emissions-equal-nearly
Who knew?
It's never about what they claim it's about.
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The inflection point was when the Supreme Court refused to hear the election fraud case. Every policy since has been anti-energy and anti-consumer and it can only get worse in the foreseeable future.
https://pjmedia.com/news-and-politics/stacey-lennox/2021/03/07/trump-was-right-gas-is-at-2-75-a-gallon-and-projeced-to-go-nowhere-but-up-n1430634
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https://oilprice.com/
thanks
Joe and crew
how stupid is this
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(https://i0.wp.com/www.powerlineblog.com/ed-assets/2021/03/Screen-Shot-2021-03-12-at-6.54.58-PM.png?resize=768%2C624&ssl=1)
https://i0.wp.com/www.powerlineblog.com/ed-assets/2021/03/Screen-Shot-2021-03-12-at-6.54.58-PM.png?resize=768%2C624&ssl=1
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(https://i0.wp.com/www.powerlineblog.com/ed-assets/2021/03/Screen-Shot-2021-03-12-at-6.54.58-PM.png?resize=768%2C624&ssl=1)
https://i0.wp.com/www.powerlineblog.com/ed-assets/2021/03/Screen-Shot-2021-03-12-at-6.54.58-PM.png?resize=768%2C624&ssl=1
Bought gas yesterday, 3.09
Drove by the station today, 3.12
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See if these columns line up.
Solar Wind onshore Gas Wind offshore Coal Nuclear
100 60 100 135 90 55
https://www.oecd-nea.org/ndd/pubs/2018/7441-full-costs-2018-es.pdf
Odd that the safest and cleanest, most reliable energy source is the cheapest, and we ignore it.
President Bozo will have us jump through $6 trillion hoops to get a worse energy grid.
Most of your electric bill goes to taxes and regulations. If you built the safest and cleanest in the first place, maybe you wouldn't need all the taxes, regulations and subsidies.
Only fossil fuels especially natural gas scale up with demand. The more solar and wind you use, that scale down at all the wrong times, the more fossil fuel use you need. Current policy, maximum solar and wind, stop fracking, ignore nuclear, raise rates, have blackouts.
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The cyber attack on the Colonial Pipeline has led to surging gasoline prices on the East Coast. But that isn’t stopping Michigan Gov. Gretchen Whitmer from trying to shut down another crucial pipeline, no matter the harm across the Midwest and Canada.
Enbridge Energy’s Line 5 transports more than half a million barrels a day of oil and natural gas liquids through Canada and the Great Lakes region. Late last year Ms. Whitmer moved to revoke and terminate an easement that lets the pipeline operate for 4.5 miles across the Straits of Mackinac. She’s seeking a state court injunction to force Enbridge to shut down Line 5 and “permanently decommission” the pipeline.
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Ms. Whitmer claims Enbridge has created an “unacceptable risk of a catastrophic oil spill in the Great Lakes that could devastate our economy and way of life.” But the Pipeline and Hazardous Materials Safety Administration, the federal regulator that oversees Line 5, said in January that it is “presently aware of no unsafe or hazardous conditions that would warrant shutdown of Line 5.”
No mode of moving energy is risk-free, but pipelines are much safer than rail. Enbridge says that over two decades Line 5 has seen five incidents that resulted in the release of 882 gallons of product. Compare that to the 2013 Lac-Mégantic disaster, where a train carrying oil derailed, spilling some 1.6 million gallons and causing an explosion that killed some 47 people.
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Enbridge is seeking permits to build a new pipeline to replace Line 5, but the project is years from completion. Consumer Energy Alliance, an advocacy group, says a shutdown of Line 5 could cause propane shortages in Michigan’s Upper Peninsula, and Midwestern farmers could face rising costs for diesel fuel and more. A report by the group found that, even by conservative estimates, Michigan, Ohio, Pennsylvania and Indiana would lose more than 33,750 jobs and $265.7 million in annual state tax revenue from the pipeline’s closure.
Refineries in Michigan, Ohio and Pennsylvania would lose much of their crude oil supply. United Steelworkers Local 912 President Justin Donley has warned that closing Line 5 would jeopardize the Toledo Refining Company, which isn’t equipped to receive oil by truck. The result would be a “devastating loss of income” for nearly 350 union workers and “further economic collapse of the Northern Ohio/Southern Michigan economy,” he said.
Ms. Whitmer is also causing a foreign policy flap. A 1977 treaty between the U.S. and Canada bars a “public authority in the territory of either” signatory nation from taking actions that would have the effect of “impeding, diverting, redirecting or interfering with in any way the transmission of hydrocarbon in transit” by pipeline between the two countries. The treaty makes exceptions for emergencies or natural disasters and temporary shutdowns for safety concerns, but not for gubernatorial whim.
The Canadian government raised these treaty concerns this month in an amicus brief filed in U.S. federal court. Refineries in Ontario depend on the pipeline, and so does the Toronto Pearson International Airport for jet fuel. “A Line 5 shutdown would severely disrupt the supply and increase the price consumers pay for fuel across Quebec and Ontario,” the Canadians argued, adding that “in western Canada, the loss of Line 5 would have a devastating impact on the industry and economy.”
Enbridge has kept the pipeline open and is counter-suing in federal court. But Ms. Whitmer’s pipeline war is a reminder that for today’s progressives, fossil fuels are enemy number one no matter the economic cost.
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https://thefederalistpapers.org/us/keystone-xl-isnt-dead-multiple-states-move-force-pipeline-biden-democrats-throats?utm_source=Email&utm_medium=brief-FP&utm_campaign=dailyam&utm_content=2021-06-05&ats_es=639c4dfcf4902e5be56a6038ef508105
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'Ecosystem is in disarray'? Maybe it's journalism that's in disarray.
https://www.nytimes.com/2021/05/26/climate/biden-alaska-drilling.html
Biden Administration Defends Huge Alaska Oil Drilling Project
The administration says the country must pivot away from fossil fuels but backed a project set to produce more than 100,000 barrels of oil each day for 30 years.
By Lisa Friedman
Published May 26, 2021
WASHINGTON — The Biden administration is defending a huge Trump-era oil and gas project in the North Slope of Alaska designed to produce more than 100,000 barrels of oil a day for the next 30 years, despite President Biden’s pledge to pivot the country away from fossil fuels.
The multibillion-dollar plan from ConocoPhillips to drill in part of the National Petroleum Reserve was approved by the Trump administration late last year. Environmental groups sued, arguing that the federal government failed to take into account the impact that drilling would have on fragile wildlife and that burning the oil would have on global warming.
The project, known as Willow, set up a choice for the Biden administration: decline to defend oil drilling and hinder a lucrative project that conflicts with its climate policy or support a federal decision backed by the state of Alaska, some tribal nations, unions and key officials, including Lisa Murkowski, a moderate Republican senator seen as a potential ally of the administration in an evenly split Senate.
On Wednesday, the administration filed a brief in U.S. District Court for Alaska, defending the Trump administration decision to greenlight the Willow project.
In a statement, the Interior Department said that the Trump administration decision complied with the environmental rules in place at the time and that the plaintiffs did not challenge the approval “within the time limitations associated with environmental review projects” for the National Petroleum Reserve.
The administration declined to explain how its position on the Willow project aligns with its climate change policies. But in its court filing, the government said the Trump administration adequately considered Willow’s impacts on fish, caribou and polar bear habitat. It also upheld the method used by the prior administration to account for the greenhouse gas emissions generated by the project.
“Conoco does have valid lease rights,” the filing states, noting that under law the company is entitled to develop its leases “subject to reasonable regulation.”
In a paradox worthy of Kafka, ConocoPhillips plans to install “chillers” into the permafrost — which is fast melting because of climate change — to keep it solid enough to support the equipment to drill for oil, the burning of which will continue to worsen ice melt.
Over the past 60 years, Alaska has warmed more than twice as fast as the rest of the United States. Arctic ecosystems are in disarray, sea ice is disappearing, sea levels are rising and the ground is thawing.
A federal court halted construction in February while the case is pending. The court could ultimately still decide against the project, its critics said. But oil and gas industry officials and members of Alaska’s congressional delegation, some of whom personally appealed to President Biden this week, said they believed the administration’s support would help it proceed.
Senator Dan Sullivan, Republican of Alaska, called the project a “big, big deal for Alaska, a big deal in my view for America” when speaking with reporters earlier this week. He said he raised the Willow project directly with President Biden when he and other members of the Alaska delegation went to the White House on Monday for the signing of a tourism bill allowing cruise ships to visit Alaska.
“He said he’d look into it and get back to us,” Mr. Sullivan told reporters after that White House meeting.
The decision comes just days after the International Energy Agency, the world’s top energy body, warned that governments must stop investing in new fossil fuel projects if they want to keep the increase in average global temperatures below 2 degrees Celsius, compared to preindustrial levels. That’s the threshold beyond which scientists say the Earth will experience irreversible damage.
...
Mr. Biden has taken significant steps to limit oil and gas development in the United States. One of his first acts as president was to temporarily freeze new oil and gas leases on public lands and offshore waters. He also placed a temporary moratorium on oil and gas drilling in Alaska’s Arctic National Wildlife Refuge, which is still in place.
The Willow project is in the northeastern portion of the National Petroleum Reserve–Alaska, an area the federal government set aside for oil and gas development. The initial discovery of oil in the Willow area was made by ConocoPhillips Alaska in 2017, and the company has said the project is expected to create more than 1,000 jobs during peak construction, and more than 400 permanent jobs.
In October, David Bernhardt, Mr. Trump’s secretary of the Interior Department, approved a plan for the company to drill up to three sites and build about 37 miles of gravel roads, at least one airstrip, 386 miles of pipelines and an oil processing facility to support that drilling.
...
Other Alaska Native groups, however, said they welcomed the jobs as well as the state and local revenue expected to be generated by the project. In an April letter to Interior Secretary Deb Haaland, George Edwardson, president of the Inupiat Community of the Arctic Slope, called oil drilling “critical to the economic survival of the eight Inupiat villages that call this region home” and said the Willow project had the group’s “strong support.”
“Alaska’s oil and gas industry provides much-needed jobs for our people, tax revenue to support our schools and health clinics, and support for basic public services,” he wrote.
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https://firehydrantoffreedom.com/index.php?topic=1096.msg133562#msg133562
(https://i0.wp.com/www.powerlineblog.com/ed-assets/2021/03/Screen-Shot-2021-03-12-at-6.54.58-PM.png?resize=768%2C624&ssl=1)
No reason given for the the unexplained increases - that hurt women, minorities and children worst.
Except for the cancellation of pipelines, drilling, fracking and the increased likelihood of Middle East war in a market based on futures contracts.
Update: More supply efforts blocked. Prices up since that post.
Analysis: The economic collapse of 2008 might not have happened and would not have been so severe if ANWR had been opened years before. Critics say ANWR would only supply 8% of out oil and gas needs. Shortage of 2008 was 8% of our oil and gas needs.
https://www.alaskajournal.com/2018-09-21/commentary-alaskans-should-be-skeptical-anti-anwr-economic-arguments
CNN: Iraq war was fought for foreign oil - [after Democrats rejected domestic sources in the 90s].
https://www.cnn.com/2013/03/19/opinion/iraq-war-oil-juhasz/index.html
Who benefits from the oil and gas scarcities and resulting price increases of the Biden years: Russia, Iran, Saudi, Maduro?, Exxon, etc.
Who loses: The American economy, the American worker, the American consumer.
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"We've got tons of oil and gas elsewhere."
- Actually not under this administration. Fracking blocked. Offshore blocked. Federal lands (most of the west) blocked. No new refineries.
Not all sources are created equal. Light, sweet crude means lower sulfur. lower carbon dioxide, fewer impurities, pollutants, and flows far better through pipelines - takes less energy to pump it- if anyone cared. [And shipping it from the Middle East is not safer or a lesser environmental impact.]
https://canaryusa.com/crude-oil-refinery-primer/
US Government under Biden isn't blocking new supplies from this one source. To them, it's not about ANWR or wildlife or refuge anymore. They are moving to block all supplies from all sources. The Biden administration wants to end the freedom to drive when, where and how you choose. They are blocking new and existing supplies of gas, creating new scarcities, driving prices up, banning new government vehicles from even using gas. Then, if still in power, they will declare the new high prices unfair and ration the shortages through other more 'fair' means than price, meaning the government will decide who can and cannot buy gas. IMHO.
Carbon-free and fossil fuel free sources of energy are possible. See new nuclear plant announced in Wyoming - with no backing I can see from the federal government. Meanwhile, what?
Economic decline is a choice and current energy policy is a big part of it.
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We are in complete agreement on the general feckless stupidity of Magoo's policies, but in this one particular case I am OK with this one.
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https://oilprice.com/Energy/Energy-General/Depleted-Gas-Stocks-Force-Europe-To-Use-More-Coal.html
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This story starts with Europe but is also true in the US we are canceling drilling and pipelines when oddly it was natural gas that lowered CO2 emissions. Substitute coal and there goes the planet.
"Coal use in power generation is also on the rise in the United States, where the price rally in natural gas is discouraging parts of gas-fired electricity generation and is set to give coal a short-term boost this summer."
https://oilprice.com/Energy/Gas-Prices/Quick-Rise-In-US-Natural-Gas-Prices-To-Boost-Coal-Demand.html
Europe must be proud of all the safe, clean nuclear energy they closed down and never rebuilt, while they jet to their save-the-world
conferences. Meanwhile, when we need energy, we follow the lead of China and burn coal, even though we all know that choice is the dirtiest.
Talk, talk, talk about smart growth and planning, 'build back better' the latest, but we are governed by morons.
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".Talk, talk, talk about smart growth and planning but we are truly governed by morons."
https://www.youtube.com/watch?v=SAdJI8xCghs
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https://washingtontimes-dc.newsmemory.com/?token=9a5d44f3a3dc36069d8ccf990f061708_60d08f55_6d25b5f&selDate=20210621
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https://www.washingtontimes.com/news/2021/jul/8/coal-poised-to-contribute-to-electric-vehicle-futu/?utm_source=Boomtrain&utm_medium=subscriber&utm_campaign=newsalert&utm_content=newsalert&utm_term=newsalert&bt_ee=ZRPKHEEcsGCBi%2FfIpP2OrkDDOVmLCyiEeHI2Lv7o1MdqhLG80QfIYHLXaoJKL9JM&bt_ts=1625747683747
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https://patriotpost.us/articles/81497-green-america-feeds-red-china-2021-07-22?mailing_id=6006&utm_medium=email&utm_source=pp.email.6006&utm_campaign=digest&utm_content=body
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https://www.dailymail.co.uk/news/article-9884057/Biden-asks-Saudi-Arabia-OPEC-produce-oil-prices-pumps-rise.html
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https://www.dailymail.co.uk/news/article-9884057/Biden-asks-Saudi-Arabia-OPEC-produce-oil-prices-pumps-rise.html
HE WANTS THE SAUDIS TO PRODUCE WHAT HE STOPPED THE AMERICANS FROM PRODUCING. Scarce, essential resource. We Impeach doesn't even start to get at the problem.
Profanity, disbelief, how do we respond to someone locking us in a room and shutting off our air supply? First he shut down US pipelines and production. Now he wants to transfer that dependence back to the Middle East? Are you f***ing kidding me?
Issue after issue after issue we can't help but ask, are they stupid or are they trying to destroy us?
All transportation sector to the grid and no upgrades to the grid. No new nuclear and closing coal and natural gas. Nat. gas is what gave us the emissions reductions of the fracking boom - and they can't see it and want to end it.
Blackouts are us.
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https://www.bbc.com/news/business-58469238
UK fires up coal power plant as gas prices soar
Warm, still, autumn weather has meant wind farms have not generated as much power as normal, while soaring prices have made it too costly to rely on gas.
----------------------------------
Has anyone ever heard of NUCLEAR?
UK is still using 50% fossil fuels BECAUSE of false reliance on "renewables".
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Leftwing MN Gov Tim Walz was chased off the stage in (conservative) Alexandria MN by left wingers as a "climate denier" for supporting the rebuilding of one aging pipeline across the state. Same group also blocked access to his state fair booth over the same issue.
https://alphanews.org/video-walz-run-off-stage-by-environmentalist-protesters/
Quite a contrast. In the videos you can see how beautiful the trees, parks and lakes are this labor day in this west central Minnesota town, home of the MacG compound, and how ugly the human leftwing protest is.
Subject previously beaten to death here, but pipelines are the cleanest, safest way to transport the energy we need now and we are buying it instead from OPEC fueling and funding terror groups and war instead of using what we have naturally here.
Governor Walz and his leftwing rhetoric and leftwing education takeover helped build and validate the movement that wants him beheaded politically. Pipelines that keep trucks and trains from having to transport our energy emit CO2? That's bullsh*t and everyone knows it except the Democrat platforms, state and national, validating these anti-American extremists.
Here's an idea. Both parties stand up to the radical environmentalists who would destroy humanity to achieve nothing, so that voters would have a choice.
Curious, how did these assh*le protesters get to Alexandria? Wind energy??
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"nuclear"
In medicine -
Magnetic Resonance Imaging, MRI
used to be called Nuclear Magnetic Resonance, NMR
Name was changed precisely because the word nuclear scared patients supposedly.
But it is imaging based on making protons wobble in nuclei ( I think)
Perhaps nuclear energy fans can consider a new marketing ploy
CLEAN FISSION ENERGY or something akin to that
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SPOILER: IT WON’T. Energy Dept. plan says 40% of U.S. power could come from solar by 2035. You want electric cars and lower carbon emissions by 2035? Start building nuclear plants now. The rest is bullshit.
Posted [today] at 1:30 pm by Glenn Reynolds
https://pjmedia.com/instapundit/
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https://zububrothers.com/2021/09/16/propane-prices-soar-as-inventory-concerns-mount-ahead-of-winter/
Any idea why?
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By: Geopolitical Futures
Energy bailout? Britain’s business secretary on Monday met with energy companies to discuss rising natural gas prices. The energy sector had earlier warned the secretary that only 10 of the 55 companies in the industry could still be operating by the end of the year. Rising demand for gas and declining supplies have led to a spike in wholesale prices, much of which must be absorbed by the energy sector because of price caps. London is now considering an emergency rescue package for the industry.
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Indonesia Clings to Coal
Denial of science, does anyone know just how DUMB it is for the US to be blocking the production AND EXPORT of natural gas?
https://www.powerlineblog.com/archives/2021/09/loose-ends-138.php
https://www.reuters.com/article/climate-change-indonesia-coal/indonesia-clings-to-coal-despite-green-vision-for-economy-idUSKBN2GG0AB
JAKARTA (Reuters) – Even as Indonesia wins cautious praise from some green groups for ambitious plans to cut carbon emissions, the world’s biggest exporter of thermal coal shows no sign of weaning itself off the polluting fuel any time soon.
(https://i0.wp.com/www.powerlineblog.com/ed-assets/2021/09/Screen-Shot-2021-09-20-at-7.53.51-AM.png?resize=768%2C287&ssl=1)
World's most populous countries:
4. Indonesia
https://www.census.gov/popclock/world
Countries 1 and 2, China and India also clinging to coal.
Cause: Bad policies and not enough prosperity. Otherwise, everyone prefers clean over dirty, and the technology and resources are available.
https://en.wikipedia.org/wiki/Nuclear_power_in_Indonesia
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https://spectator.org/carbon-capture-democrats-climate-change-apocalypse/
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https://www.wsj.com/articles/bitcoin-miners-eye-nuclear-power-as-environmental-criticism-mounts-11632654002
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Lithium batteries, another false panacea?
Thinking through the electric car push
By Alexander E. Hooke
Next time, be careful what you wish for—Dionysus, god of wine, to King Midas.
Lithium has been coined “white gold” for a good reason. In carbonated form, it quickly replaces the “black gold” of oil as a centerpiece for new energy sources. Lithium is an essential element to smartphones and batteries for electric cars. Is it a panacea to relieve us from the carbon footprints of gasoline-driven autos and trucks, thus protecting the environment from fossil fuels?
Unlike lead batteries, lithium-based batteries are light and long-lasting. They are less susceptible to extreme temperatures and easily recharged. According to advocates, electric cars present a realistic dream to reverse the threatening trends of human-induced global warming.
However, there are considerable drawbacks to this dream. Lithium is not easily obtained. According to a 2020 study by the Institute for Energy Research, it can take 500,000 gallons of water to extract a metric ton of lithium from the earth. While much of this extraction is done in other countries, especially in China and South America, soon the United States will need to decide how to extract lithium within its own borders to establish independence. Another reliance on foreign sources for our energy, such as the OPEC oil debacles in earlier decades, could be disastrous.
This problem leads to controversies over where to obtain lithium from our lands. So far, the areas with the most potential are protected under designation as natural wonders or national parks that deserve protection. For example, places such as the Panamint valley in the western part of Death Valley hold rich deposits of “white gold.” If permitted, companies would need to build major roads that can handle trucks and commuter traffic. This could threaten the pristine and remarkably eerie aspects of Death Valley that attract travelers from all over the world.
Another problem concerns how 500,000 gallons of briny water used to extract lithium can be safely released into nature. Researchers and reporters have found that this altered water can easily kill a variety of wildlife and fish. Indeed, if consistency is a guideline, those opposed to fracking for oil should raise similar opposition to lithium extraction.
A third problem is the simple availability of freshwater. States in the Southwest are facing drastic depletion of freshwater from the Colorado River and Lake Meade. Water rationing might soon be a reality. Should we speculate on sending water from the Great Lakes or our Maryland reservoirs to the millions of citizens who chose to live in the desert? Imagine choosing between directing 500,000 gallons of freshwater to nourish crops, animals, and fellow citizens or to lithium deposits to energize electric vehicles.
In this light, we might be faced with a Devil’s bargain: Smartphones and electric cars or our mountains, rivers, and native creatures?
This dilemma has caught environmentalists in a strange paradox. While they support the goal of electric vehicles (i.e., cleaner and cooler air), they cannot abide by the side effects generated by lithium excavation. No wonder environmentalist Guillermo Gonzalize remarks, “This (lithium) isn’t a green solution. It’s not a solution at all.” “Beware what you wish for…” is an adage found in Aesop’s Fables, ancient Chinese tales, and generations of folk wisdom. In the case of King Midas, he wished that everything he touched turned into gold. Have not many of had similar wishes? Ingrates as humans tend to be, we soon become both inundated and inured with our unexpected goodies.
King Midas soon regretted his wish and pleaded with Dionysus to reverse the order of things. Presumably, if you are the god of wine, you are tranquil and joyful enough to forgive mortals their moments of insatiability.
In this light, despite good intentions, it remains dubious that the electric car is a panacea. It is also not clear how humanity’s incessant demand for more energy to support our endless needs and wishes will be addressed by a Dionysus of the 21st century. The current demand for lithium will be a test for today’s deities.
Alexander E. Hooke is a professor of phi-losophy at Stevenson University. His most recent book is Philosophy Sketches—700 Words at a Time, 2nd Edition (Apprentice House)
We might be faced with a Devil’s bargain: Smartphones and electric cars or our mountains, rivers, and native creatures? This dilemma has caught environmentalists in a strange paradox.
While they support the goal of electric vehicles (i.e., cleaner and cooler air), they cannot abide by the side effects generated by lithium excavation. No wonder environmentalist Guillermo Gonzalize remarks, “This (lithium) isn’t a green solution. It’s not a solution at all.”
Copyright (c) 2021 Washington Times , Edition 9/30/2021Powered by TECNAVIA
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Wow, good point. Same liberals favoring all this, electric cars, iPhone, I-devices, oppose mining, oppose nuclear, oppose coal, basically oppose electricity, but want to charge everything up at night.
My hybrids use NiMH, not as cool as lithium. My ebike and power tools use lithium. If I really had to get somewhere without fossil fuels I would have to ebike all day and charge all day. I mowed 3 city yards with 2 lithium batteries yesterday. Recharge time for those batteries is really long. An hour of work takes a day to recharge. Not much gets done at that rate.
Tesla charge is 50 - 85 kW, 300 watt hour per mile. 8 hours of direct sun on a giant panel will let you drive 4 miles from home and back. Not a very productive day for a tradesman. Do the math for your home furnace or AC, it isn't going to work. Then they say home solar needs lithium to charge your lithium (but oppose mining) . How much water and money will that take? If we had free and magical batteries coming, we would still need to build nuclear power first. Ten years lead time and nobody is even thinking of starting it yet.
All these wild ideas for greener and cleaner require building prosperity first. Polar opposite of the 'green' agenda. Imagine that.
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https://www.americanexperiment.org/matt-ridley-the-root-of-the-energy-crisis/
Put the economists at
Center for the American Experiment
on your regular read list.
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SSESSMENTS
The World Braces for a Period of High Energy Prices
14 MIN READOct 1, 2021 | 21:15 GMT
Cars line up at a gas station in the U.K. village of Odiham amid fuel shortages on Sept. 30, 2021.
Cars line up at a gas station in the U.K. village of Odiham amid fuel shortages on Sept. 30, 2021.
(ADRIAN DENNIS/AFP via Getty Images)
High global energy prices are likely to remain through the end of the Northern Hemisphere’s winter, which will undermine COVID-19 economic recoveries in energy-importing countries, hurting low-income population segments the hardest. The higher prices will also exacerbate the global manufacturing sector’s fragile recovery and ongoing supply chain challenges, while increasing pressure on governments’ energy transition plans. On Sept. 28, European light sweet crude benchmark Brent hit $80 per barrel for the first time since 2018. As of Oct. 1, European natural gas hubs Dutch TTF and U.K. NBP benchmarks, as well as the Asian JKM liquified natural gas (LNG) benchmarks, were also all trading between $30 to $35 per British thermal unit (mmBtu), which is equivalent to about $170 to $200 per barrel of oil. Brent has since fallen back to around $78 per barrel. But even if prices remain in the $70s and natural gas demand rises, significant impacts will remain.
Although natural gas prices have risen, the United States’ natural gas market continues to be shielded from global market conditions, with U.S. benchmark Henry Hub still trading at just $6 to $7 per mmBtu.
Energy markets are likely to remain tight over the coming months and much of the price risk is on the high side. How high natural gas prices go will depend on the severity of the coming winter in the Northern Hemisphere. In Europe, gas storages are low for this time of year as high prices and the gas supply crunch has deterred companies from raising inventories quickly. As of Sept. 28, European gas storage levels were at 73% full compared with 94.9% one year ago and a five-year seasonal average of 89% — meaning that increased heating demands from a cold snap could stress stockpiles. This also comes at a time when oil demand is already on the rise due to the global economic recovery from COVID-19 and the partial resumption of travel. High natural gas prices are also driving oil substitution for natural gas in industries where the two can be swapped as well, including power generation and plastics. A high level of substitution could see global oil demand increase by as much as 1-2 million barrels per day (bpd). Regardless, high oil prices will put pressure on OPEC+ — particularly at its Oct. 4 meeting — to change its current production plans and add more oil to the market on top of the 400,000 bpd the bloc is slated to add each month through the end of the year. Should oil prices remain around $80 per barrel, it may cause enough demand destruction for OPEC+ to step in. But throughout the course of the COVID-19 pandemic, the bloc has shown it will only conservatively raise oil production levels.
In a Sept. 13 note to a client, Bank of America said oil prices briefly returning to $100 per barrel cannot be ruled out in the case of a colder-than-usual winter this year. In a Sept. 27 client note, Goldman Sachs — already one of the most bullish oil price forecasters — also raised its end of the year forecast for Brent from $80 to $90 per barrel. And in a Sept. 23 client note, Citi more than doubled its Q4 forecast for natural gas prices for JKM and TTF to $28.80 and $27.70 per mmBtu, respectively. Citi also said prices could increase to $100 per mmBtu (equivalent to roughly $580 per barrel of oil) if the Northern Hemisphere sees particularly low temperatures this winter.
Higher natural gas prices in Europe will also fuel speculation that Russia is cutting back supplies to prop up prices and pressure Germany and Europe to give full approval to the Nord Stream 2 pipeline. Swedish trading house Trafigura downplayed such speculation in a Sept. 27 conversation with Bloomberg, saying that Russia was dealing with low inventories, seasonal maintenance and surging export commitments to Turkey and Asia that limits potential exports to the European market at this time.
Americas
In Latin America and the Caribbean, record energy prices will drive social unrest and inflationary pressures. Governments in Latin America and the Caribbean are likely to increase existing subsidies and tax exemptions in an effort to offset the effect of the higher prices on low-income households, as well as special interest groups like Brazilian truck drivers who have previously staged economically devastating protests over high prices. For countries with high fiscal deficits such as Brazil and Mexico, additional spending on subsidies could come at the cost of increasing fiscal pressures. As many countries in the region are recovering from the economic devastation of COVID-19, higher energy prices will likely spark civil unrest. The risk of rising energy prices sparking related anti-government protests is particularly high in Argentina, Chile and Colombia, which each have upcoming elections. Such economically motivated unrest in the lead-up to the votes could contribute to a shift toward leftist political leadership in these three countries, as seen in Peru’s June general election.
For Brazil and Mexico — Latin America’s two largest oil producers — higher prices could help fund more government subsidies and/or welfare programs, as well as boost the profits of their respective state-run energy giants Pemex and Petrobras, which could, in turn, increases tax revenue. Increased energy prices will also benefit Argentina and other countries with high taxes and tariffs on oil. Meanwhile, the region’s emerging oil producers like Colombia, Guyana and Suriname will likely see increased foreign investment, though European majors are unlikely to contribute largely to that boost given their aggressive focus on shifting new investments away from hydrocarbons.
Asia-Pacific
High energy prices will drive power outages in China as the wider Asia-Pacific region prepares for winter. In China, high prices — particularly for coal — and environmental policies designed to reduce emissions are causing power shortages across China. Power producers are also in a bind because Beijing continues to restrict its ability to pass on high electricity prices to consumers, causing many power plants to reduce electricity generation instead. Should China allow consumers to bear power prices or deepen subsidies for power producers, China’s energy demand could soar higher, which is good for China’s coal producers but could further raise global prices for other fuels. A cold snap last winter pushed China to use more natural gas, but with current LNG prices also now high, some power companies will still continue to reduce generation — even if officials improve at rationing electricity to minimize production delays and shortages in thermal coal.
Southeast Asia and Japan are also relying more heavily on pricey LNG to get through the winter electricity surge, which is driving policy efforts to both expand LNG exploration and extraction and reconsider more reliable alternative energies like nuclear, in the case of Japan. South Korea and Japan could again find themselves in a similar situation from last winter, when Asian LNG prices spiked to a then-record of nearly $30 per mmBtu in January. Similar to China, high energy prices will further complicate already fragile economic recoveries in East and Southeast Asia, particularly as many of these nations are considering reopening their economies despite ongoing COVID-19 outbreaks and incomplete vaccination campaigns, which will further increase regional energy demand from manufacturers, adding to the winter power surge. The near universality of this energy squeeze in Asia, as well as the continued economic impacts of COVID-19 shutdowns, will minimize widespread manufacturing relocations, though countries heavily exposed to power-strapped markets like China may make short-term moves to avoid production delays.
Eurasia
Russia will benefit from high energy prices, despite accusations of market manipulation. Higher prices will be a boon for Russia’s state-owned gas monopoly Gazprom and oil giant Rosneft, as well as private Russian companies like LNG producer Novatek. These energy producers’ increased revenues will provide a boost to Russia’s economy and ease constraints on the country’s federal budget. Other top hydrocarbon-producing countries in the region — namely, Kazakhstan, Azerbaijan and Turkmenistan — will also reap the benefits of higher prices.
Russia’s Gazprom, which has not booked additional gas transit to Europe via Ukraine since this spring despite record prices, will maintain gas transit levels through Ukraine. Additional Russian gas flows to Europe will instead primarily come via Nord Stream undersea pipeline to Germany and the Yamal-Europe pipeline via Poland and Belarus — providing additional transit revenues for those states.
Record energy prices in Europe will lead to persistent accusations that Gazprom and possibly other Russian producers are engaging in a Kremlin-approved effort to pressure or influence European states, tacitly reminding their governments that Russia can use high gas prices in winter to cause major political damage to European governments if they do not acquiesce to Kremlin’s desires. Russia is interested in convincing Europe of the necessity of the Nord Stream 2 pipeline and will seek through multiple avenues to convince European regulators to delay its operation once certification is completed, which is currently expected in January 2022. While the merits of the accusations of market manipulation are debatable and the Kremlin will continue to deny them, the price crunch will still bolster those in Europe calling for their states to invest in green alternatives and, in turn, reduce their energy dependence on Russia in the long term.
Europe
Rising energy prices are likely to slow down Europe’s post-pandemic economic recovery and lead to higher social unrest. Industries will face higher operating costs and households face higher costs of living, reducing their disposable income. Inventories at storage facilities across the continent are at dangerously low levels for this time of year, while Norway and Russia are struggling to meet natural gas and oil demands from their European customers. In the European Union, rising carbon prices are also contributing to higher costs for industries. Meanwhile, in the United Kingdom, insufficient wind has reduced the contribution of wind energy to the country’s supply mix. If this winter is particularly cold, European countries could face greater competition for LNG imports with East Asian countries, which are dealing with their own energy supply problems. This could put European companies across various sectors of the economy — from fertilizer producers to car factories — out of business. It could also result in higher inflation across Europe, which would have a particularly negative impact on low-income households, especially if food prices go up.
Should the current energy crunch in Europe continue, it could have significant social and political repercussions across the Continent. Governments are likely to provide subsidies and tax waivers, particularly to low-income households, to mitigate the impact of higher energy prices. But this could come at the cost of deepening their already high fiscal deficits, which would make it even harder for governments to return to fiscal discipline in the short-to-medium term. The risk of anti-government protests and an escalation of social unrest is particularly high in Southern Europe, where unemployment is still below pre-pandemic levels, but cannot be ruled out in other parts of the Continent. Finally, the ongoing energy crisis in Europe has led to louder criticism, particularly from countries in Central and Eastern Europe, of the European Commission’s plans to tighten its Emissions Trading System (ETS) and expand it to additional sectors of the economy as a part of its push to make the bloc carbon neutral by 2050. Critics argue Brussels’ plan will disproportionately affect low-income households and result in renewed protests like France’s Yellow Vest movement. Defenders of the plan, however, argue that rising oil prices actually underscore the need for a faster energy transition in the bloc.
The Middle East and North Africa
A rise in energy prices will benefit many governments in the Middle East and North African region, which is home to some of the world’s largest oil and gas reserves. Higher revenues will offer relief to indebted countries heavily reliant on energy exports like Iraq and Algeria, helping fund crucial budget items like public sector salaries that have taken a hit amid the pandemic-related drops in oil revenue. Higher energy export revenues will also benefit Saudi Arabia, the United Arab Emirates, Qatar and Kuwait’s state-run energy producers, enabling these Arab Gulf states to funnel more money into economic diversification efforts by helping pad their government budgets.
Should prices remain high for an extended period, however, it will risk also prolonging Middle Eastern and North African countries’ economic dependence on energy revenues, which will eventually become a liability and reduce the region’s market competitiveness once prices eventually come back down. Higher energy prices will also risk exacerbating U.S.-Saudi tensions over the former’s oil production policy, with Washington pressuring Riyadh to adjust its output more in line with its capacity to help manage global energy prices.
Meanwhile, for the region’s energy importers, higher prices will risk slowing near-term economic growth following pandemic-related slumps. This risk will be especially pronounced in countries like Lebanon and Turkey, where the added cost will exacerbate already high commodity prices and inflation — fueling more anti-government anger by further crippling citizens’ purchasing power. Higher energy prices will also encourage existing investment plans in countries like Egypt that are net energy importers seeking to become exporters.
South Asia
In South Asia, high energy prices risk slowing — and potentially even halting — the economic recoveries of the region’s largely import-dependent countries. India, which imports more than 85% of its oil supply, has already seen high domestic fuel prices in recent months. Higher fuel prices will increase inflation at a critical time of India’s economic recovery as vaccine coverage rises, and as lockdown measures and restrictions ease. On Sept. 30, India increased the local natural gas price from $1.78 mmBtu to $2.90 mmBtu for the next six months,
Increased energy costs will also exacerbate inflation in Sri Lanka, which already is reeling under a liquidity crunch and high foreign debt — raising the risk of food and other essential goods shortages in the country. Meanwhile, Pakistan, which is heavily reliant on LNG imports for its electricity needs, could see increased inflation and power outages in the coming months. Indeed, LNG import terminal officials In Pakistan are already warning that widespread blackouts are possible if prices continue to rise, potentially provoking social unrest.
Sub-Saharan Africa
African energy producers will struggle to meet demand as their consumers threaten unrest. Sub-Saharan Africa’s oil producers — namely Angola and Nigeria, Equatorial Guinea, the Republic of Congo and Gabon — are currently reaping the benefits of increased prices. These countries will try to use the profits to fuel their pandemic recovery efforts and/or help improve their fiscal position. But, even for oil-producing countries, the vast majority of economic activity for most citizens remains in other sectors. This means that if governments do not use higher oil windfalls to increase public spending, people living in these countries will likely see little improvement in their own lives and pocketbooks.
In Nigeria, sub-Saharan Africa’s biggest energy producer, the higher oil prices will put the government in a difficult spot when it comes to consumer fuel prices, as Nigeria’s delipidated refining sector makes the country — despite its high oil production — dependent on refined product imports. In Nigeria, rising gas prices are a major political issue and, if unabated, will cause nationwide strikes and unrest. Rising prices compounded with high inflation will also lead to mass civil unrest elsewhere in sub-Saharan Africa, and in some cases, violent government crackdowns on protests.
Meanwhile, consumers across sub-Saharan Africa are suffering from high food, water, gas and other commodity prices. In Kenya, fuel prices increased 6% overnight earlier this month after the government was forced to halt fuel subsidies. In East Africa, particularly, high prices are exacerbated by an ongoing drought, raising the cost of living for many regional citizens beyond reach. It’s a similar story in South Africa, where rising fuel prices are driving up consumer prices, which are nearly 20% higher than they were this time last year.
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Lead editorial (Sept 20), Washington Examiner, famous people caught reading the forum:
"All Climate treaties are a joke"
"convert all or nearly all of the grid to nuclear power. No other method has ever worked or come close."
"Begin a long-term project to convert all or nearly all of the grid to nuclear power. No other method has ever worked or come close. (Well, except maybe in Gambia.)
Natural gas, including the new technology of zero-emission natural gas, is still helping the U.S. reduce its emissions. It is a cheap and useful fuel, and it will be the best bridge to nuclear, perhaps along with certain economically useful carbon capture technologies. Nuclear (fission) can, in turn, become the bridge to fusion, which will come online in a demonstration capacity at MIT within five years and should be everywhere within 30 years. Fusion has all of nuclear's advantages, but without any of the danger or radioactive waste. Because the products of fusion cannot be weaponized as with nuclear fission, it is a technology the U.S. and its allies can share even with enemies such as China, Russia, and Iran.
That's the answer to carbon emissions — everything else is already a proven waste of time. Those who reject nuclear, including most of the American Left, are not serious about the issue and should not be included in any conversation about the climate. They are just looking for new ways to hinder the economic growth that limitless energy will give humanity and new excuses to "tax the rich."
Given that effective and economically feasible options already exist for solving climate change, Biden should immediately abandon expensive pie-in-the-sky Green New Deal projects — and also stop signing silly treaties that let China pollute as much as it likes.
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"Unless you are for nuclear power everywhere, you aren't green" - Hugh Hewitt today, in response to Prince Charles running his car on wine and cheese byproducts, bio fuel that requires farmland and deforestation to produce en masse.
Famous people caught reading the forum.
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Nicely assertive articulation there by HH! I think I will be using it.
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https://spectrum.ieee.org/solid-state-battery
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https://www.breitbart.com/politics/2021/11/17/louisiana-ag-leads-13-state-lawsuit-targeting-bidens-attack-u-s-energy-independence/
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https://townhall.com/columnists/stephenmoore/2021/11/30/joe-bidens-dirty-little-secret-he-wants-higher-gasoline-prices-n2599812
Just look at everything he has done, and this column covers it well.
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December 21, 2021
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Russia’s Fertilizer Diplomacy
Runaway gas prices are hurting fertilizer production – and opening up opportunities for Moscow.
By: Ekaterina Zolotova
Already volatile natural gas prices went through the roof in Europe last week after the chief of Germany’s energy regulator said the Russia-to-Germany gas pipeline known as Nord Stream 2 would not begin operating until at least the second half of 2022. The news pushed European gas prices above $1,700 per thousand cubic meters for the first time in two months. Businesses and households, already getting squeezed by high inflation and entering the winter months, are on edge. What’s more, soaring gas prices also disrupt other activities like the production of nitrogen fertilizers, which are derived from natural gas and whose cost to produce is becoming prohibitively expensive because of the gas price surge. The gas crunch, the emergence of new coronavirus variants and governments’ turn toward protectionist measures to stabilize domestic food prices mean that the fertilizer industry will remain unstable for at least the first few months of 2022. This is bad news for much of the world, but not for Russia, with its large gas reserves and sizable fertilizer production capacity.
The Kremlin’s energy diplomacy – using its wealth of natural gas supplies to influence other governments, mostly in Europe – is infamous. Get ready for Russian fertilizer diplomacy.
Enough to Go Around
While other countries scramble to prevent a shortage of fertilizers, which would hurt agricultural production and could lead to food shortages, Russia is producing more fertilizers than it needs. The country is responsible for 13 percent of global fertilizer supplies. With its enormous supply of raw materials, Russia produces each of the three main types of fertilizers: nitrogen, phosphorus and potash. It uses its natural gas and coal to produce nitrogen fertilizers; mineral phosphates go into making phosphorus fertilizers; and potassium fertilizers come from rare potassium-rich salts. Nitrogen fertilizers are about 40 percent of total Russian fertilizer production, followed by potash (35 percent) and phosphorous (15 percent).
Russia’s output of mineral fertilizers has been growing for the past two decades, even during the pandemic. In 2020, Russian production of mineral fertilizers grew faster than the world average (5 percent versus the global rate of 2 percent), to 54.8 million tons. Even at current energy prices, its production costs are relatively low, and even the introduction of new green standards in Europe isn’t a significant hindrance. Russia exports more than two-thirds of its fertilizer output, with sales going to more than 90 countries.
Russian Fertilizer Exports
(click to enlarge)
Russia’s fertilizer production is directed at the global market because of the limited profit opportunities on the domestic market. Russian agriculture as a whole (not just wheat production, which we’ve covered) is in a much better state today than it was in the 1990s and early 2000s, but growth opportunities at home are still limited. Russian consumption of fertilizers is rising – the share of mineral fertilizers that Russia exported fell to 68 percent of production from 75 percent between 2015 and 2020 – but it’s still growing very modestly.
In addition, Russian farmers are using less fertilizer than before relative to total farmland. Just before the collapse of the Soviet Union, 88 kilograms of fertilizer were used per hectare, compared with 69 kilograms per hectare today.
Russian Fertilizer Usage
(click to enlarge)
It’s no surprise that profit-motivated Russian manufacturers would choose to prioritize the foreign market, where profit opportunities are better. There are several reasons for this, but the main reason is the poor quality of Russian croplands. Huge swaths of Russia’s croplands are depleted, soils are overcompacted due to overuse of heavy equipment, and pesticides have killed off naturally beneficial microbiota. The fertile chernozem zone through the Russian steppes is characterized by acidified soils, where mineral fertilizers are less effective. Without deoxidizing the soil, it may be difficult to make additional profit.
Reserved for Friends
Even though Russia’s fertilizer industry is export-oriented, the Kremlin underlined the sector’s geopolitical significance last month when it introduced export quotas for six months beginning Dec. 1. Moscow justified the decision by pointing to higher prices abroad as a result of a sharp rise in gas prices. But given the limited size of the Russian market, the massive scale of Russia’s fertilizer output and the fundamental problems in the country’s agricultural sector, there is reason to doubt the official account. What’s more, when Russian President Vladimir Putin visited India earlier this month, he discussed an agreement between Russia’s PhosAgro and Indian public sector enterprises regarding the supply of fertilizers in 2021 and 2022, in spite of his own government’s export restrictions.
The Kremlin’s logic is simple: The more strained the global fertilizer market is, the more leverage Russia has. For example, when production of nitrogen and phosphate fertilizers – which are seriously exposed to volatility and seasonal factors – is depressed, Russia can cash in on booming sales and new contracts in the potash market, where there are fewer suppliers and where long-term contracts prevail, providing more stable prices. Russia already exported more than 10 million tons of potash fertilizers in the first 10 months of 2021, a 28 percent increase over the same period last year.
Moreover, Russia expects that it can exploit uncertainty to increase its share of the global market. The European market is especially interesting for Moscow, but there are also opportunities in Asia, Africa and Latin America, which, led by Brazil, remains the top foreign destination for Russian fertilizers. Russia hopes that offering reliable supplies will enhance dialogue with certain countries with which Moscow is interested in cooperating. For instance, Putin has long pointed to India as a strategic partner with a large market. Africa is another important region where Russia is testing the waters. And potential contracts with Europe could give Russia new leverage in difficult ongoing strategic negotiations. The timing is especially propitious for Russia because new European eco-labeling rules for mineral fertilizers, as well as pandemic-induced delays in commissioning several fertilizer production facilities in other countries, have restricted the number of competitors on the fertilizer market.
It’s becoming clear that Russia stockpiled fertilizers not to drive up prices or supply its own farmers, but to pressure partners, especially in Europe, to pay attention to Russia and offer dialogue in hopes of winning lucrative contracts. However, it’s difficult to imagine that the current situation in the fertilizer market will solve Russia’s most significant problems. Western sanctions aren’t going away, and certification of Nord Stream 2 looks a long way off. Russia’s fertilizer diplomacy also won’t resolve the difficulties in its domestic agricultural market. But Russia will try anyway.
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https://dailycaller.com/2021/12/21/european-natural-gas-prices-russia-gazprom-joe-biden/?utm_source=piano&utm_medium=email&utm_campaign=2360&tpcc%3D=newsletter&pnespid=sbo_CnseOqgXgOXBujvsEs2BtgCkDYd0MPSzmu9m.kZm.rLecLnBVAQX5FV.iesnNgKFEl9h
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https://www.andersoneconomicgroup.com/wp-content/uploads/2021/10/EVtransition_FuelingCostStudy_10-21-21.pdf
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Plenty of interesting discussion here.
This caught my attention: 40% of Euro nat gas comes from Russia? That's a rather substantial number , , ,
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BY ANDREW STUTTAFORDImageJanuary 08, 2022
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NR PLUS MEMBER FULL VIEW
Europe’s Energy Crisis: The Shape of Things to Come?
The New Year has not begun on the happiest of notes with Omicron stalking the land, the Fed upsetting the markets, an “interesting” jobs report, and the latest inflation numbers on the horizon (I suspect that we are not in for a nice surprise).
Then there’s Europe’s energy crunch. It hasn’t gone away.
CNBC:
Europe is facing continued volatility in its wholesale gas markets, prompting concerns across the region that an energy crisis could be about to get even worse.
The front-month gas price at the Dutch TTF hub, a European benchmark for natural gas trading, was around 5% higher by 1 p.m. London time on Wednesday, with the price reaching 93.3 euros per megawatt-hour. Contracts for March and April delivery were also up by 5% on Wednesday, according to New York’s Intercontinental Exchange . . .
Ole Hansen, head of commodity strategy at Saxo Bank, told CNBC in an email that gas prices in the EU and the U.K. remained at the mercy of the weather, the pace of shipments, and Russia.
“Into January, the price of gas has resumed its ascent, again with the prospect of colder weather driving increased demand for heating and very, very low supplies from Russia, especially via two important pipelines through Poland and Ukraine,” Hansen added. “Whether Russia is deliberately keeping supplies down due to Nord Stream 2 pipeline approval delays and the Ukraine border crisis is difficult to say. But it highlights failed energy and storage policies in Europe and the U.K., which has left the region very dependent on imports of gas, especially given the still unreliable level of power generation from renewable sources.”
To put a number on that, over 40 percent of Europe’s natural gas is currently supplied by Russia.
What could possibly go wrong?
On the topic of Russia, I suspect that Moscow’s intervention this week in Kazakhstan in the wake of the turmoil in that country (disturbances triggered, incidentally, by a sharp rise in fuel prices, although there were deeper underlying causes) may well reduce the chance that Russia will broaden its existing military operations in Ukraine for now. Although that doesn’t mean that it will neglect opportunities to toy with Europe’s gas supplies in order to “encourage” the granting of the final approvals needed for the Nord Stream 2 pipeline (a second northern route for the delivery of Russian gas to Europe) to open up for business, and, more generally, to show who is already, to an alarming extent, boss.
To repeat something that I have mentioned before, the reason for the current price spike in Europe does not (with the exception of the U.K. and, arguably, Germany) owe much to its climate policies, but it is a reminder that much of the continent’s energy supplies are less secure than had, until recently, been assumed. The “race to net zero” may, partly, be the product of panic, but it also owes a great deal to complacency. If there is anything good to come out of Europe’s current energy woes, it is that they may act as a useful reminder that the current trajectory of its climate-driven energy policy is an invitation to disaster. We simply are not yet at a stage where renewables can fill the gap opened up by the abandonment of fossil fuels. And it’s not easy to forecast when we will be. Fixing dates for hitting net zero is all very well, but one thing we should have learned after the 20th century is that when central planners ignore reality, disaster will follow.
And in this case, one uncomfortable reality is that both wind and solar are dogged by a range of problems caused by intermittency, the unalterable fact that the wind doesn’t always blow, and the sun doesn’t always shine. Moreover, the hours that the wind and the sun do what they are supposed to do are not entirely predictable: One cause of the U.K.’s energy problems this fall was that North Sea winds just didn’t do what was expected of them, a failure that extended over a fairly lengthy period of time.
Some have argued that the current difficulties are an argument for investing more in renewables, an argument based on the idea that this would reduce dependence on other energy sources. To an extent that’s obviously true, but it still doesn’t address the issue of intermittency. If the wind is not blowing, it doesn’t matter how many wind turbines have been installed. Rather than pouring more billions into the installation of a technology that is not yet ready for prime time (I suspect that this is much more the case for wind than for solar), it would be better to increase funding for research designed to find a way to work around intermittency. It would cost less and would be a far better use of resources.
Meanwhile, from Bloomberg:
The energy crisis roiling markets in Europe is a preview of what the U.S. will face over the next 10 years as it shifts to cleaner power sources, according to Ed Morse, Citigroup’s global head of commodities research.
“We are in the first crisis of the energy transition,” Morse said in an interview on Bloomberg Television. Switching away from fossil fuels is an “event that is going to be disruptive, dislodging and it’s going to create disharmony at home and internationally — and it is also going to make superb advances.”
We’ll have to see about the second half of that last sentence. Assuming the Biden administration continues on its current course, the rest of the excerpt will, I suspect, prove all too true, even if Morse puts it too gently. To be sure, the transition will be “disruptive” and “dislodging,” but those adjectives and the word “disharmony” may understate the extent of the economic, social, and geopolitical havoc to come if the present direction of climate policy is maintained.
Over at the Wall Street Journal, Bjorn Lomborg crunches some numbers:
Energy prices are soaring, and it’s likely a sign of things to come. The rise can be blamed on a variety of things, including the demand rebound after the lockdowns ended, a drop in renewable electricity output from a lack of wind in Europe during most of 2021, and increasingly costly climate policies. But while the pandemic will end and the wind will blow again, climate policies to achieve “net zero” emissions will keep hiking prices.
Barack Obama acknowledged in 2008 that electricity prices “would necessarily skyrocket” under his proposed climate policies. He was more candid than many of today’s politicians and advocates. Limiting the use of fossil fuels requires making them more expensive and pushing people toward green alternatives that remain pricier and less efficient . . .
Costs will continue to rise if politicians remain bent on achieving net-zero emissions globally. Bank of America finds that achieving net zero globally by 2050 will cost $150 trillion over 30 years—almost twice the combined annual gross domestic product of every country on earth. The annual cost ($5 trillion) is more than all the world’s governments and households spend every year on education. Academic studies find the policy is even costlier. The largest database on climate scenarios shows that keeping temperature rises to 2 degrees Celsius—a less stringent policy than net zero by midcentury—would likely cost $8.3 trillion, or 3.3% of world GDP, every year by 2050, and the costs keep escalating so that by the end of the century taxpayers will have paid about $1 quadrillion—a thousand trillion—in total.
I should mention that that estimate is based on the notion that “climate policy costs will be spread efficiently,” something Lomborg rightly concedes is a “heroic assumption” (a key part of his definition of “efficiently” is that “big emitters China and India” cut the most), meaning that more-conservative estimates of the real cost would likely be far higher.
A quadrillion here, a quadrillion there, and pretty soon you’re talking real money.
Lomborg later turns his attention to the U.S.:
For the U.S., one recent study in Nature found reducing emissions only 80% by 2050 will cost more than $2.1 trillion in today’s money annually by midcentury. That is more than $5,000 per American a year. The cost of achieving 100% reductions would be far higher. And this study assumes reductions will be carried out in the most efficient way possible—namely using a single national, steadily increasing carbon tax—but that’s unlikely, and with less-than-ideal policies, the price would be still higher.
Climate activists may not want to acknowledge these costs, but voters will force them to eventually . . .
But will they? As I have discussed on numerous occasions, the name of the climate game has been to remove as much climate policy from the political process as possible, whether by effectively delegating it to regulators in both the public (for example, the Fed, the SEC) or private sectors (accountancy rule makers, for instance) or, indeed, to the unsavory corporatists now setting the agenda on Wall Street and in the C-suite. Nevertheless, sooner or later the costs of the current approach to climate policy are going to become all too evident. If there’s any silver lining to be found in today’s very dark cloud, it is that this energy crunch will increase the chances that enough voters will understand what is coming before it is too late. If that, in due course, also prompts questions about the priorities of today’s climate policy, so much the better.
Where money should be spent, other than on intermittency workarounds, is on energy research, on nuclear power, on limiting the carbon emissions created by existing fossil-fuel resources (ask yourself whether that is more likely to take place in the West or in the OPEC countries or in Russia) and, of course, resilience. To take one example, a (job-intensive) policy of toughening up the flood defenses of low-lying coastal cities ought to appeal to many voters, wherever they stand on climate change. The same can be said of burying power lines in densely populated areas of the U.S.
Here and there, there are hints that an awareness that the current approach is not, to use a possibly unfortunate adjective, economically (and perhaps even politically) sustainable, is sinking in, even in Brussels. The EU Commission has proposed classifying some (there are some fairly stringent restrictions) nuclear and (natural) gas projects as sustainable for the purposes of the EU’s green “taxonomy,” a recognition, in the latter case, of the value of natural gas as a “bridge” fuel between now and a more thoroughly decarbonized future.
The Economist went into more detail on the taxonomy here.
An extract:
The idea emerged after the 2015 Paris climate deal, when the EU’s effort to craft a common green-bond standard for corporate and sovereign issuers revealed that members did not agree on what counted as green. Some countries have since worked on their own classifications, but Europe’s, which maps swathes of the economy over 550 pages, is the most comprehensive.
The taxonomy hopes to end the practice of greenwashing and boost investors’ faith in sustainable assets. It will offer a common set of criteria that investors and banks can use to screen potential investments. Most money managers already have their own teams and tools to measure greenery. But the lack of a shared benchmark means scorecards remain subjective and inconsistent across the industry, which confuses investors. Having a dictionary where they can look up whether an investment can be labelled green puts everyone on the same page . . .
The Commission’s proposal has attracted heavy criticism from, inevitably, Greens (many of whom not only harbor an ancient hatred for nuclear energy but also regard any recognition that natural gas can play a role in an energy transition as succumbing to the wicked allure of fossil fuels). The question of nuclear energy has also highlighted a rift within the EU.
Politico:
Countries like France and Poland have been pushing strongly for the inclusion of nuclear energy in the taxonomy list as they argue that it is a crucial low-carbon technology which is needed to provide energy security while the EU transitions to renewable energies in the coming decades.
Alongside Germany, other countries like Austria or Luxembourg fiercely oppose such a move amid concerns about nuclear accidents and waste. They would like to see nuclear energy disappear from the EU instead of encouraging the construction of new plants through the green labeling . . .
The proposal must win sufficient support from EU member states (which seems likely: It would take a “reverse reinforced qualified majority” to vote it down) and then the approval of the EU Parliament. To repeat a guess prediction that I made the other day, I think it will go through, a view bolstered by a report that Germany will, when it comes to a vote, abstain — a non-decision reflecting divisions in an unlikely governing coalition made up of the left-of-center SPD, the Green party and the free-market FDP. The FDP and SPD are in favor of the inclusion of gas, the Greens not so much.
That said, all three parties continue to favor phasing out nuclear power. At year end, three out of Germany’s six remaining reactors were switched off. The last three will have gone out of operation by the end of this year. Yes, this is nuts.
On the other hand, as Robert Zubrin reported for Capital Matters in December:
While a year ago French president Emmanuel Macron was calling for cutting the nuclear fraction of France’s electric power from its current 75 percent down to 50 percent (thereby eliminating the world’s only actually decarbonized major electric-power grid), on November 9 he called for “relaunching construction of nuclear reactors in our country . . . to guarantee France’s energy independence, to guarantee our country’s electricity supply and achieve our objectives, in particular carbon neutrality in 2050.”
And:
U.S. energy secretary Jennifer Granholm began her tenure ten months ago by announcing the Biden’s administration’s commitment to strangling the nuclear industry by blocking the establishment of a waste repository. But at the COP26 conference last month, she was all in for nuclear power: “We are very bullish on these advanced nuclear reactors,” Granholm said. “We have, in fact, invested a lot of money in the research and development of those. We are very supportive of that.”
It may be noted that Granholm was voicing support for types of reactors that do not yet exist.
But, it’s a start, I suppose.
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Biden’s Berlin Gas Airlift
The West’s energy disarmament is a gift to Putin on Ukraine.
By The Editorial Board
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Jan. 26, 2022 7:07 pm ET
Gas wells at Bovanenkovo gas field owned by Gazprom on the Arctic Yamal peninsula, Russia, May 21, 2019.
PHOTO: MAXIM SHEMETOV/REUTERS
Energy is Russia’s most potent nonnuclear weapon, so it’s no surprise that Vladimir Putin is leveraging it as he threatens Ukraine. Europe’s climate obsessions have made it vulnerable to Russia, and so the Biden Administration is riding to the rescue by begging the Arabs and other energy producers to boost natural gas deliveries.
Russia typically supplies about 40% of Europe’s gas imports, but it has sharply truncated deliveries. Kremlin officials are threatening to cut off supply if the U.S. and Europe impose sanctions in response. Germany is especially dependent on Russian gas, which is why it has been reluctant to help arm Ukraine.
A Russian gas embargo could starve households of heating fuel this winter and potentially next if there’s a hot war in Ukraine. Gas might have to be rationed. Manufacturers could be forced to shut down, further damaging the economy and supply chains. At this perilous moment, it’s worth recounting how Europe got itself into this cold mess.
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Start with government bans on hydraulic shale fracturing. Europe’s gas reserves are smaller than Russia’s, though it has about as much technically recoverable shale gas as the U.S., according to the Energy Information Administration. Yet European governments won’t let this strategic asset be developed.
Mr. Putin has helped fuel the green opposition. As former NATO Secretary General Anders Fogh Rasmussen said in 2014, Russia “engages actively” with green groups “working against shale gas, obviously to maintain European dependence on imported Russian gas.”
Germany has made itself even more dependent on Russian gas by shutting down nuclear plants, which provide low-cost baseload power. Even as Russia reduced gas deliveries, Germany in December shut down three nuclear plants, and three more will be mothballed this year. This is the definition of self-sabotage.
The Trump Administration pressed Germany to build liquefied natural gas (LNG) import terminals to diversify its gas supply, as Poland, the Netherlands and Lithuania have done. But German LNG terminals are snarled in permitting delays. One company last year decided to turn an LNG project into a green hydrogen hub. This won’t heat homes.
Across most of Europe, coal plant shutdowns have also left Europe more dependent on gas. So have heavily subsidized solar and wind, which must be backed up by gas. As wind production lagged last summer and fall, gas demand and prices soared.
As a result, Europe entered the winter with little gas in storage. Russia exploited this by slowing gas deliveries. While rising gas prices send a market signal for power retailers to use more coal, Europe’s cap-and-trade program discourages this switch even when gas prices are surging.
All of this explains why the Biden Administration is now scrambling to locate spare gas to rescue Europe from Mr. Putin’s tender mercies. U.S. LNG exports are nearly maxed out, and many cargo ships are already headed to Europe. More U.S. LNG export capacity is expected to come online later this year, which will make America the world’s top LNG exporter.
Other major LNG producers such as Qatar and Australia may be able to boost supply to Europe at the margins. But Europe could still be staring into a long, dark winter if Russia imposes a gas blockade. It’s hard not to wonder how European leaders didn’t see this coming in 2014 when Mr. Putin invaded Crimea.
The self-created energy vulnerability of the West is one of the horrifying marvels of the age. You have to go back to the disarmament of the 1920s to recall a time of such willful self-delusion. Even as President Biden races to rescue Europe, his Build Back Better plan would send the U.S. down the same road of energy disarmament.
White House officials say Russia and Europe are interdependent since the Kremlin relies on oil and gas revenue to fund its budget. But Russia has other energy clients, including China. Gazprom is building gas pipelines to China. Even as Europe becomes more dependent on Russia for gas, Russia is becoming less dependent on Europe for revenue.
At the same time, the White House is making the U.S. more dependent on China for the minerals needed to advance its green energy agenda. On Wednesday, the Administration canceled Twin Metals Minnesota’s rights to mine copper, nickel and cobalt in northeast Minnesota. Green groups are pushing to scotch lithium mining in Nevada.
One predictable result will be shortages and higher prices. Doesn’t President Biden understand that inflation and high energy prices empower the very dictators he claims we are fighting in a long, twilight struggle?
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Nuclear Power, Natural Gas Secure EU Backing as ‘Green’ Investments
Proposal to expand what can qualify as sustainable investment sparked outcry from some member states, investors
The European Commission is to label energy from nuclear power and natural gas as ‘green’ investments, in the face of fierce opposition.
PHOTO: INA FASSBENDER/AGENCE FRANCE-PRESSE/GETTY IMAGES
By Kim Mackrael
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and Daniel Michaels
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Updated Feb. 2, 2022 9:19 am ET
BRUSSELS—Brushing aside charges of greenwashing, the European Union will press ahead with a controversial proposal to label certain nuclear energy and natural-gas investments as sustainable over the coming years despite strong opposition from some of the bloc’s member states, environmental groups and investors.
The proposal to expand what can qualify as a sustainable source of energy has exposed deep rifts between countries that rely on different technologies and comes amid surging electricity prices. Nuclear and natural gas are just two high-profile components of a plan that will affect a range of industries—from forestry to manufacturing and transportation—and is meant to shift the ways companies and investment funds approach sustainable investment.
The European Commission, the EU’s executive arm, published a revised version of its proposal on Wednesday, which includes tweaks to the criteria for labeling nuclear and natural gas as sustainable and changes that are meant to strengthen companies’ disclosure requirements.
“Today is a means to an end,” EU Financial Services Commissioner Mairead McGuinness said in a press conference announcing the plan. She said the proposal that lays out conditions for including nuclear and natural gas as sustainable investments “may be imperfect but it is a real solution. It moves us further towards our ultimate goal of carbon neutrality.”
The proposal, which was first released on New Year’s Eve, is part of the EU’s “green taxonomy,” a detailed breakdown of what regulators believe should count as a sustainable investment. The goal is to funnel more capital into projects and activities that have been vetted for their sustainability and avoid greenwashing, where companies exaggerate their sustainability credentials.
“People need a benchmark, to say ‘I can hang my hat on something,’ and I think that’s where the taxonomy comes in,” said Shashank Krishna, a partner at law firm Baker Botts who specializes in sustainable energy investments. “Depending on how this whole debate on gas and nuclear plays out, this might actually become, by default, the global benchmark.”
Money is a sticking point in climate-change negotiations around the world. As economists warn that limiting global warming to 1.5 degrees Celsius will cost many more trillions than anticipated, WSJ looks at how the funds could be spent, and who would pay. Illustration: Preston Jessee/WSJ
The proposal adopted by the European Commission on Wednesday stands a good chance of becoming law. Member countries and the European Parliament have up to six months to review the plan, during which time they could vote against it, but the threshold for blocking it is high. Austria and Luxembourg have also recently threatened to sue the commission if the plan were adopted in its draft form. Whether such a suit will proceed is unclear.
Bas Eickhout, a Green member of the European Parliament from the Netherlands, said the plan to include nuclear and natural gas in the taxonomy is “tantamount to greenwashing” and undermines the EU’s credibility in addressing climate change. The proposed conditions for including those energy sources are too weak, he said, and don’t do enough to address concerns about the safe storage of nuclear waste.
The EU framework doesn’t directly affect energy investments overall, just whether they can be labeled as “green.” Individual countries can continue to make their own decisions about the sources of energy they use. Still, climate activists and some investors say that if nuclear power and natural gas projects are designated as potentially environmentally friendly, such projects could draw funding away from less-harmful investments in sustainable renewables.
The inclusion of nuclear and natural gas was challenged by environmentalists and some investors, who warned the decision risked undermining the taxonomy’s integrity and usefulness. The Platform on Sustainable Finance, an advisory group to the Commission, said last month that the plan proposed by the European Commission on Dec. 31 was “unsuitable for financial markets.”
The Institutional Investors Group on Climate Change, whose members manage about €50 trillion in assets, or the equivalent of about $56 trillion, last month called for natural gas to be removed from the sustainable investment list. It said the current criteria “hinders the capacity of our members to align their portfolios with net zero” carbon emissions and undermines the purpose of the taxonomy.
Some critics warn the inclusion of gas and nuclear could undermine the taxonomy’s authoritativeness if some EU member countries and investors choose not to accept its designations. European Investment Bank President Werner Hoyer suggested last week that the bank, an EU institution, might not make use of the green label for nuclear and natural gas.
Some portfolio managers for sustainable funds said they, too, might hold off on using aspects of the taxonomy, given the political debate.
“We want to make sure that whatever they come up with is agreed upon by multiple parties and therefore likely to stand for a long time, because these are long-term investments we need to make,” said Matt Breidert, a senior portfolio manager at sustainable-investment firm Ecofin, which has about $2 billion assets under management.
Including nuclear and natural-gas investments in the taxonomy might make financing those projects a little cheaper, said Georg Zachmann, a senior fellow with Brussels-based think tank Bruegel. But even if those projects were excluded, that wouldn’t stop them from being built or running. One broader impact, he said, is that the controversy over categorizing nuclear as a green investment could give investors a better sense of where public opinion lies.
The debate happening now “will reveal more clearly what the preferences of the European population are on certain technologies, and that will guide investors to understanding what they can put their money on and what might risk a backlash in the future,” Mr. Zachmann said.
Write to Kim Mackrael at kim.mackrael@wsj.com and Daniel Michaels at daniel.michaels@wsj.com
Corrections & Amplifications
The Institutional Investors Group on Climate Change said in January that natural gas should be removed from the sustainable investment list. An earlier version of this article incorrectly said the comment was made this month. (Corrected on Feb. 2)
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A point mentioned (at least once) on the forum:
https://www.bloombergquint.com/opinion/nuclear-power-is-essential-in-fighting-climate-change
Nuclear Power Is More Important Than Ever Bloomberg Editorial Board
From the article:
"After the disasters at Chernobyl in 1986 and Fukushima in 2011, turning away from nuclear power seemed prudent. Now it looks like a serious error"
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Chernobyl was a Soviet failure and at Fukushima, the diesel generators failed.
You can't be serious about lowering CO2 emissions with the technologies available today and not go big on nuclear. Elon Musk says we need to double the capacity of the grid in order to put transportation on it. Do that (at night) with what? Batteries? Coal??
It takes 10-12 years to build new nuclear power plants. Let's.Get.Started.
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Biden’s Regulators Empower Putin
FERC sets rules that will block new U.S. natural gas pipelines.
By The Editorial Board
Follow
Feb. 18, 2022 6:40 pm ET
We live in strange and contradictory times. President Biden is trying mightily to deter a Russian invasion in Ukraine at the same time his regulators are working to give Vladimir Putin more leverage over global energy supplies. Obsessive climate politics gets more self-destructive by the week.
In an act of bizarre timing, the Federal Energy Regulatory Commission (FERC) on Thursday revised its policy for approving natural gas pipelines and export terminals. FERC by law must vouch that projects are in the public interest and won’t have a significant environmental impact. But now the agency plans to include greenhouse gas emissions in this analysis. The vote was 3-2, with two Republican commissioners dissenting.
***
Here’s the kicker: The pipeline analysis may include emissions from upstream production and downstream consumption even though there’s no reliable way to measure either one. You can bet that regulators beholden to climate activists will assert that every new pipeline will massively increase emissions even though more pipelines are needed to transport natural gas to back up unreliable renewables, especially as nuclear and coal plants shut down. It won’t matter if the piped gas is replacing dirtier coal or helping to keep the lights on.
Climate activists are disappointed because FERC says it doesn’t plan to consider the downstream emissions of LNG facilities, which is the Energy Department’s purview. But FERC also knows U.S. LNG exports will have no impact on downstream emissions. If the U.S. exports less LNG, Europe and Asia will simply buy more gas from Russia or Qatar.
LNG export facilities depend on pipelines to supply them with gas. By blocking pipelines, FERC will effectively block more LNG export projects. The U.S. has seven LNG export terminals and will become the world’s largest exporter this year with the completion of a new facility. Yet many LNG projects are stalled because of pipeline constraints.
The Marcellus and Utica shale deposits in Appalachia contain enormous amounts of natural gas that could be exported to Europe. But almost all approved and proposed LNG export terminals are located on the Gulf Coast because Democratic states and greens have blocked pipelines in the Northeast. Without pipelines, U.S. gas is stuck in the ground.
Mr. Biden’s decision to kill the Keystone XL pipeline destroyed thousands of jobs and damaged Canada-U.S. relations. But oil from Alberta and North Dakota’s Bakken shale can still be transported by rail, truck and existing north-south pipelines whose flows have been reversed.
Pipeline constraints are suppressing production and prices in Appalachia in particular. Prices for Appalachian gas are some 15% lower than on the Gulf Coast. At the same time, spot prices for LNG shipments to Europe this winter were about 10 times more than what gas in the U.S was fetching. LNG is an enormous economic opportunity that FERC is throwing away.
This is probably why Sen. Joe Manchin came out so strongly against FERC on Thursday. “Today’s reckless decision by FERC’S Democratic Commissioners puts the security of our nation at risk,” the West Virginia Democrat said. “The Commission went too far by prioritizing a political agenda over their main mission—ensuring our nation’s energy reliability and security.”
“The only thing they accomplished today was constructing additional road blocks that further delay building out the energy infrastructure our country desperately needs. Energy independence is our greatest geopolitical and economic tool and we cannot lose sight of that as instability rises around the globe.”
He’s right on every point. FERC is diminishing U.S. geopolitical leverage against a revanchist Russia, which supplies about 40% of European gas imports. Russia is rapidly building pipelines and LNG export terminals to make Asia as dependent on its gas as Europe is so it can extort U.S. allies. Moscow is already using gas exports to pressure Japan not to join Western sanctions if it invades Ukraine.
Rest assured, Mr. Putin’s apparatchiks won’t be analyzing gas-project emissions. The climate obsessions of the left have already raised energy costs for hundreds of millions of Americans and are making the electric grid less reliable. Now they are actively aiding and abetting a dictator who may launch the biggest war in Europe since World War II.
Treasury Secretary Janet Yellen and Energy Secretary Jennifer Granholm ought to be screaming at FERC to cease its political war on U.S. gas. But they are either MIA or believe that harming U.S. security to indulge climate virtue-signaling is good policy. FERC may nominally be an independent agency, but its new pipeline obstruction is following Mr. Biden’s executive orders. The buck stops with him.
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They don't want us to heat our homes.
Greater economic freedom in Russia than in US under Biden.
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https://www.powerlineblog.com/archives/2022/02/latest-from-the-dreamworld-of-green-energy.php
"a correction issued by the agency Tuesday said running electric boilers would cost between 4.2 and 4.9 times more than their fossil fuel equivalents."
Electric heat costs 5 times as much!
And do it how, with night solar??
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"Under my plan... electricity prices will skyrocket" - Barack Obama 2008
https://pjmedia.com/eddriscoll/2009/06/13/this-guy-is-good-really-good-and-frankly-so-far-were-not-n241277
Yes they will. Yes they did.
-----------------------------
Oops, narrative changed:
(https://instapundit.com/wp-content/uploads/2022/02/Screen-Shot-2022-02-23-at-8.51.57-AM-600x216.png)
Ukraine did it. Trump!
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Why Is Democratic Biden Rescuing Autocratic Erdoğan at the Expense of U.S. Allies?
by Burak Bekdil
February 24, 2022 at 5:00 am
Send
Print
Share8
In early January... in a bolder, less expected and potentially damaging geostrategic move that angered all four of Turkey's Mediterranean rivals (Greece, Cyprus, Israel and Egypt), the Biden administration silently abandoned an eastern Mediterranean pipeline project (EastMed) that would carry Israeli gas through Cyprus to Europe.
"By undermining the project, the administration is undercutting three of our strongest allies in the region: Israel, Greece, and Cyprus, as well as the European Union's hopes for energy independence and economic prosperity." — Press release published on the congressional website of U.S. House Representative Gus Bilirakis, January 24, 2022.
"The Biden administration's actions in this matter are particularly objectionable and hypocritical in light of its tacit approval of Russia's Nord Stream pipeline, which will only deepen Europe's energy dependence on a volatile adversary." — Rep. Gus Bilirakis, January 24, 2022,
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Medvedev:
German Chancellor Olaf Scholz has issued an order to halt the process of certifying the Nord Stream 2 gas pipeline. Well. Welcome to the brave new world where Europeans are very soon going to pay €2.000 for 1.000 cubic meters of natural gas!
— Dmitry Medvedev (@MedvedevRussiaE) February 22, 2022
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https://www.gatestoneinstitute.org/18281/biden-europe-eastmed-pipeline
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https://www.conservativereview.com/horowitz-time-for-red-states-to-declare-energy-independence-and-thwart-bidens-embargo-on-us-production-2656791788.html
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Does anyone remember the whining about oil companies getting subsidies [really just the right to deduct expenses from revenues]?
Now this:
(https://mcusercontent.com/dc8d30edd7976d2ddf9c2bf96/images/8abd90c7-54bb-e0b2-f930-5653874245c6.png)
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https://www.youtube.com/watch?v=qn8houXU52E
OR
https://www.google.com/search?q=image+of+angry+putin&tbm=isch&source=iu&ictx=1&vet=1&fir=zbm0isB6bxXXXM%252CIWV70msRA1cz8M%252C_%253B3yWOlLtLa5SAbM%252CIWV70msRA1cz8M%252C_%253B9efR4c9HBvHssM%252C6c81o-2nrTyd9M%252C_%253BiBzmCRCf8vqNcM%252CIWV70msRA1cz8M%252C_%253BVO4wKrEx5WQxkM%252CIWV70msRA1cz8M%252C_%253BGOIHNiAp0zvtxM%252Ckqj3ZAlJTgwjiM%252C_%253ByVzJDi2IuwKX2M%252CIWV70msRA1cz8M%252C_%253B0QKN0g4iZWk2mM%252CA6v3QiQsMX7guM%252C_%253BcygGXvcv4bVi7M%252Ckqj3ZAlJTgwjiM%252C_%253BFrNWB6EzbICMBM%252CIWV70msRA1cz8M%252C_&usg=AI4_-kTsFbSnCB9chXCMI0-dGKaqrL5mlw&sa=X&ved=2ahUKEwjbtOWhlrX2AhVNj4kEHYs9CwQQ9QF6BAgGEAE#imgrc=3yWOlLtLa5SAbM
hat tip to GM!
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https://twitter.com/MAGAJew2/status/1500309926861758467
I hope you can laugh hard enough to keep warm.
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https://www.cnn.com/europe/live-news/ukraine-russia-putin-news-03-08-22/h_80c41dda8cf19a524b760f9380015787
not one peep from leftist MSM about how their people (DEMS) caused this ...... :x
climate does NOT take precedence over all else!
I don't want to drive an electric piece of crap :roll:
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we need to increase oil & gas output immediately." Elon Musk
https://www.inc.com/minda-zetlin/elon-musk-tweet-oil-gas-nuclear-ukraine-war.html
Elon Musk @elonmusk Mar 4, 2022
Hate to say it, but we need to increase oil & gas output immediately.
Extraordinary times demand extraordinary measures.
Elon Musk @elonmusk
Obviously, this would negatively affect Tesla, but sustainable energy solutions simply cannot react instantaneously to make up for Russian oil & gas exports.
4:48 PM · Mar 4, 2022
---------------------------------------------------------------------
Analysts attribute this view by Elon Musk as common sense. It is, but also:
- We need fossil fuels to power the grid, or Tesla owners will need fossil fuel powered tow trucks ot get home.
- A bankrupt nation will not buy many electric cars.
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I don't remember where, but recently I saw a graph of US oil production.
IIRC it showed production of 13M barrels per day when Biden took office, then dropping sharply to 10, and working its way back to 11.
Whether I am remembering correctly or not, could someone come up with a graph chart showing our oil production levels in recent years, including the year of Bidene?
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second
=========
Kim Strassel is a quality writer at the WSJ but I confess to being confused here, by both her analysis and indeed by the whole sanctioning Russian oil idea. Oil and NG are fungible, yes? So what is the effect upon Russia and upon America if only we sanction Russian energy?
Friday-afternoon news dumps are always revealing, and that includes last week’s Treasury Department clarification of U.S. sanctions on Russian banks. Don’t buy the Biden administration’s line that it’s pulling out the stops against Russia.
The president continues to insist he’s “enforcing the most significant package of economic sanctions in history” against Vladimir Putin’s regime. Some Biden loyalists are even veering toward hagiography. Connecticut’s Chris Murphy bragged last week on the Senate floor that Mr. Biden’s “stunning” diplomacy had produced “a sanctions package that is sweeping, that is unprecedented, that is breaking the back of the Russian economy.” The press nods along.
The reality is far different, which accounts for rising frustration in Congress—and growing divisions between even Democrats and the White House. The administration refused to impose sanctions in the lead-up to Mr. Putin’s invasion, naively trusting diplomacy. Yet even after Russian tanks rolled—and despite having months to prepare—the response has been slow, timid, hostage to feel-good “multilateralism” and unwilling to attack the real engine of the Russian economy: energy. Even the president’s own party is losing patience with his inadequate sanctions.
Consider that Treasury announcement. In late February Mr. Biden grandly announced sanctions targeting Russian banks. Yet on Friday, Treasury quietly clarified that the sanctions won’t apply to the banks’ energy transactions until June 24—meaning Wall Street can continue to trade in Russian oil and gas. “The energy sector of the Russian Federation economy itself is not subject to comprehensive sanctions,” explained Treasury’s website, a scandalous caveat the media largely ignored.
Sen. Rob Portman on Tuesday asked Undersecretary of State Victoria Nuland to justify the decision to give the Russian energy sector a pass for four months. She explained that working “multilaterally” remained the top priority, so “we did agree to a phase-in” at the behest of energy-dependent “European allies.”
Mr. Biden this week belatedly announced a ban on Russian oil and gas—but only because congressional Democrats and Republicans were uniting to pass legislation forcing his hand. Even Speaker Nancy Pelosi supported the ban and reportedly refused to agree to a White House demand to drop it. The Biden team scrambled to get ahead of Congress by announcing the embargo itself.
The White House has also demanded congressional Democrats stand down on a bipartisan bill that would suspend Russia’s preferential trading status with the U.S.—again, seemingly in order to discuss it to death with Europe. The good news is that lawmakers in both parties said late this week that they remain undeterred and may pass the trade restriction next week—potentially forcing Mr. Biden’s hand again.
The White House is nonetheless getting its way when it comes to blocking a Republican bill from Sen. Jim Risch that would impose real sanctions on Russia’s oil, gas, mining and mineral sectors. It targets oligarchs. It would create a lend-lease program to ensure Ukraine will continue to get necessary military resources. Crucially, it provides for “secondary sanctions” against global institutions that finance the Russian economy. As Mr. Risch notes, these secondary sanctions would “force the world’s financial institutions to make a choice between Russia and Western markets” and finally “isolate” the Russian economy.
The White House is resisting all this for the same reason it resisted the Russian oil embargo. Truly punishing sanctions against Russia’s energy sector are still anathema to Old Europe allies who want to continue importing Russian oil. The administration also fears that seriously targeting Russian energy would further drive up gasoline prices, hurting Mr. Biden domestically. Senate Foreign Relation Chairman Bob Menendez was, before the invasion, working with Mr. Risch on a bipartisan bill. At the behest of the White House, he went AWOL, and Democrats last week blocked a vote on the Risch legislation.
Republicans note that for all the talk of multilateralism, the U.S. is woefully trailing Europe in other areas. Since February the European Union has imposed sanctions on at least 12 oligarchs among the Navalny 35, a list of key Putin abetters compiled by dissident Alexei Navalny’s organization. The U.K. has targeted nine of them since February; the U.S., zero. Yes, Washington has targeted a handful of Putin cronies, but it’s only a sliver of the hundreds of oligarchs who hold Russia’s wealth. It did, however, announce a “task force” to investigate oligarch behavior. Twenty-two years into the Putin regime, the U.S. government doesn’t have that information?
The Biden team will argue that sanctions work best in conjunction with allies. No doubt. But the way to get the world to join in truly punishing and isolating Mr. Putin is to lead by example and to invite or shame allies into joining the fight. It’s not the current approach, which is to yammer in the halls of Foggy Bottom and settle for the path of least resistance. Mr. Biden can talk all he wants about his plans to cripple Mr. Putin’s economy. He has yet to take the steps that might actually do it.
Write to kim@wsj.com.
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I don't remember where, but recently I saw a graph of US oil production.
IIRC it showed production of 13M barrels per day when Biden took office, then dropping sharply to 10, and working its way back to 11.
Whether I am remembering correctly or not, could someone come up with a graph chart showing our oil production levels in recent years, including the year of Bidene?
"The most recent data available from the Energy Information Administration (EIA) shows current U.S. oil production at ~11.6 million BPD — still 1.4 million BPD short of pre-pandemic production. This shortfall is a major factor that led to the run-up of oil and gasoline prices". - Forbes
Doug: That shortfall is greater than the amount we buy from Russia.
https://www.forbes.com/sites/rrapier/2022/03/11/what-is-holding-back-us-oil-production/?sh=173d36c6b6f6
chart:
https://www.macrotrends.net/2562/us-crude-oil-production-historical-chart
https://images.app.goo.gl/ziYG9uAqgrvZoyog8
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Thank you Doug.
=======================
Why U.S. Oil and Gas Producers Aren’t Solving the Energy Crisis
The crash of 2020 and the pressure of climate-change politics led them to reconsider their business models.
By Paul H. Tice
March 15, 2022 12:30 pm ET
On the back of Russia’s invasion of Ukraine, crude oil prices jumped above $100 a barrel, and the average cost of U.S. gasoline has surpassed $4 a gallon. Yet domestic oil production has barely budged over the past two years and remains stuck below 12 million barrels a day, 10% to 15% below the pre-pandemic high.
The total U.S. oil rig count has bounced back, but only to roughly 75% of the recent peak in March 2020. Major U.S. shale producers, particularly ones in the Permian Basin of Texas, have a break-even oil price close to $30 a barrel, so why isn’t American supply responding to price signals from the global market?
First and foremost, U.S. shale got a wake-up call about its business model in 2020. That’s when the combination of an OPEC+ oil-market-share battle and pandemic lockdowns briefly turned crude oil prices negative and decimated the energy sector, driving more than 100 North American oil and gas companies into bankruptcy by year end.
After largely giving lip service to shareholder activists following the 2014 shale crash, almost every U.S. energy company has also embraced the need for capital spending restraint and generating free cash flow rather than simply expanding production. Flat or up slightly (5% or less) is the new production growth paradigm, and living within cash flow is paramount. This fiscal discipline held through 2021 even as crude oil prices doubled and continues to hold despite a roughly $30-a-barrel price jump since the beginning of 2022.
Last year energy rebounded from the annus horribilis of 2020 and became the best-performing sector in the U.S. equity and debt markets. Energy-company management teams don’t want to rock this boat, especially given regulatory clouds looming over the industry.
Feeding into the U.S. industry’s self-imposed choke valve on aggregate oil volumes is the outlook for restricted drilling growth and market access in coming years, which is where the Biden administration’s anti-fossil-fuel policies come into play.
U.S. oil and gas producers need to extend their drilling inventories and permit runways further into the future because the Biden White House is canceling or slow-walking leases on federal lands while clawing back acreage for national monuments. The administration also is taking advantage of environmental and endangered-species statutes to curtail drilling on private land. New energy infrastructure projects—including interstate pipelines and liquefied natural gas export facilities—are subject to a global climate test, a charge for the social cost of carbon and environmental-justice standards. All this will have a chilling effect on new projects and further reinforce industry consolidation.
The main risk to the industry over the next decade is not the potential for oil and gas demand to go down because of the global energy transition away from fossil fuels. It is the high likelihood of more energy supply-chain bottlenecks created by government officials. A supply-constrained scenario would be bullish for oil prices, giving producers even more incentive to keep hydrocarbon reserves in the ground now to produce them at higher realized prices down the road. As seen by the four legally paralyzed years of the Trump administration, even if Republicans regain the White House in 2024, not much would change with regard to the inexorable march toward 2030, the year of the climate rapture set by the United Nations.
U.S. energy companies have begun to wise up to the threat that the theory of man-made climate change poses to the industry. Since the Paris Agreement’s signing in 2015, the global goal of decreasing carbon emissions has provided moral justification for an all-out regulatory assault.
The latest front is the sustainable-investment movement sweeping Wall Street, which has climate action as its top environmental, social and governance objective. U.S. and European financial regulators are pushing through mandatory reporting standards on sustainability. This is the first step toward screening and excluding politically incorrect industries such as oil and gas from investment portfolios. As the intertwined climate-change and sustainability movements gain momentum between now and 2030, the lending and capital markets are likely to become more hostile toward traditional energy.
U.S. shale companies will need to ensure their ability to self-fund from operations and run with less balance-sheet debt to reduce their dependence on financing from the banking system and institutional investors. Consequently, corporate sustainability doctrine provides another strong argument for U.S. energy companies to maintain the status quo of slow to no production growth and to continue living within cash flow over the long term.
Ironically, all the defensive measures now being taken by the U.S. shale industry make it more attractive—and sustainable—from an investment perspective. On top of production and spending discipline and stronger energy commodity prices, some shale players are merging to build critical mass, both in operating scale and financial-market capitalization.
So why aren’t American oil and gas companies producing more barrels to help tamp down oil and gasoline prices during a global market shock when domestic inflation is rampant? The answer, as with everything that revolves around climate change, is complicated.
Mr. Tice works in investment management and is an adjunct professor of finance at New York University’s Stern School of Business.
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Wood burning emits twice as much CO2 as a high efficiency natural gas furnace and is infinitely worse emitter of the other toxins, soot and filth. And far more dangerous, think of house fires and wildfires.
Who knew?
It is costing me close to $200/mo to heat EMPTY small homes - with the thermostat turned all the way down. Just enough heat to prevent freeze up, not provide any comfort costs a fortune.
Strangely, it also feels like the coldest winter ever (like they had in Antarctica this past year).
As I talk to the non-rich (non-Democrats) struggling to fill their tanks and heat their homes in the north country, across the heartland and in the mountains , people tell me more and more about relying on wood burning stoves to keep their natural gas bills down.
IS THIS WHAT WE WANT?
------------------
https://www.sierraclub.org/sierra/2014-4-july-august/ask-mr-green/what-greener-fireplace-choice#:~:text=Because%20burning%20wood%20releases%20about,even%20the%20cleanest%20wood%20stoves.
It is cruel for rich liberals like Stephen Colbert and Pete Buttigieg to tell us to just buy a subsidized Tesla and forget we don't have the money, there aren't enough of them available if we did, they still run on fossil fuels, the batteries rely on China, and WE STILL NEED TO HEAT OUR HOMES!!
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"It is cruel for rich liberals like Stephen Colbert and Pete Buttigieg to tell us to just buy a subsidized Tesla and forget we don't have the money, there aren't enough of them available if we did, they still run on fossil fuels, the batteries rely on China, and WE STILL NEED TO HEAT OUR HOMES!!"
little non elites like us ,
do not know what is best for the planet.
the little "folks " will need to sacrifice
so the elites tell us it is for their own good
it is a crises
we will all die
and the rest
while they all profit and are not affected ......
:roll:
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Canada could replace supply ended from Russia.
We would just need one thing to transport it in - the KEYSTONE XL PIPELINE.
https://www.zerohedge.com/commodities/canada-says-its-oil-could-replace-us-imports-russian-crude-all-it-would-take-approval
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Interesting that we squeezed out own energy producers by blocking pipelines, leases and drilling in the name of climate change. Result was a windfall to oil producing nation Russia, who used the money to bring diesel powered weaponry across the 11 time zones of Russia to Ukraine.
Begs the question, what kind of MPG do these thousands of tanks get?
-------------------------------------------------------------------------------
https://michaelshellenberger.substack.com/p/the-wests-green-energy-delusions?s=r
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so
Rick the lib Newman (yahoo [non]news)
"teaches us"
https://finance.yahoo.com/news/the-real-reason-gas-prices-are-so-high-163554412.html
in other words the minute Biden took office the oil producers decided
lets lower production and raise gas prices
:roll:
definition of a lib
NEVER ADMIT YOU ARE WRONG DEPITE ALWAYS BEING WRONG
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but wait
Rick Newman just informed me there was nothing Biden could do to lower prices
https://www.yahoo.com/finance/news/jpmorgan-ceo-jamie-dimon-reportedly-145146234.html
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https://www.washingtontimes.com/news/2022/mar/25/us-eu-announce-new-partnership-to-undercut-russian/?utm_source=Boomtrain&utm_medium=subscriber&utm_campaign=newsalert&utm_content=newsalert&utm_term=newsalert&bt_ee=bDmonTPeq%2ByywxbfYUo75hxojZyQzW3hlY6jV3LGS5PvEanAPhHRqhoBZNPXTDzE&bt_ts=1648200167475
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Sending stimulus check to cover energy cost rise. Government solves problem government created. Two wrongs make... two wrongs. Why are you closing clean safe nuclear? Why are you relying on enemy for energy?
https://tradeforprofit.net/2022/03/german-taxpayers-to-receive-e300-lump-sum-amid-exploding-energy-costs/
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https://www.dailycaller.com/2022/03/07/donald-trump-warned-united-nation-relying-russian-oil-german-delegation-laughed
https://www.zerohedge.com/markets/germany-getting-distinct-feeling-deja-vu-about-its-exploding-inflation
https://summit.news/2022/03/29/government-minister-tells-germans-to-cope-with-soaring-energy-costs-by-wearing-warmer-sweaters/
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https://www.zerohedge.com/commodities/putin-signs-decree-ordering-gas-exports-be-halted-if-buyers-dont-pay-rubles
https://www.dailycaller.com/2022/03/07/donald-trump-warned-united-nation-relying-russian-oil-german-delegation-laughed
https://www.zerohedge.com/markets/germany-getting-distinct-feeling-deja-vu-about-its-exploding-inflation
https://summit.news/2022/03/29/government-minister-tells-germans-to-cope-with-soaring-energy-costs-by-wearing-warmer-sweaters/
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How do you say "Checkmate" in Russian?
https://www.zerohedge.com/energy/basf-ceo-warns-germany-total-collapse-if-russian-gas-supply-cut
https://www.zerohedge.com/commodities/putin-signs-decree-ordering-gas-exports-be-halted-if-buyers-dont-pay-rubles
https://www.dailycaller.com/2022/03/07/donald-trump-warned-united-nation-relying-russian-oil-german-delegation-laughed
https://www.zerohedge.com/markets/germany-getting-distinct-feeling-deja-vu-about-its-exploding-inflation
https://summit.news/2022/03/29/government-minister-tells-germans-to-cope-with-soaring-energy-costs-by-wearing-warmer-sweaters/
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https://www.zerohedge.com/geopolitical/clever-tactics-putin-gets-his-way-rubles-energy-demand
How do you say "Checkmate" in Russian?
https://www.zerohedge.com/energy/basf-ceo-warns-germany-total-collapse-if-russian-gas-supply-cut
https://www.zerohedge.com/commodities/putin-signs-decree-ordering-gas-exports-be-halted-if-buyers-dont-pay-rubles
https://www.dailycaller.com/2022/03/07/donald-trump-warned-united-nation-relying-russian-oil-german-delegation-laughed
https://www.zerohedge.com/markets/germany-getting-distinct-feeling-deja-vu-about-its-exploding-inflation
https://summit.news/2022/03/29/government-minister-tells-germans-to-cope-with-soaring-energy-costs-by-wearing-warmer-sweaters/
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https://dailyreckoning.com/rickards-ive-never-heard-so-many-lies/
https://www.zerohedge.com/geopolitical/clever-tactics-putin-gets-his-way-rubles-energy-demand
How do you say "Checkmate" in Russian?
https://www.zerohedge.com/energy/basf-ceo-warns-germany-total-collapse-if-russian-gas-supply-cut
https://www.zerohedge.com/commodities/putin-signs-decree-ordering-gas-exports-be-halted-if-buyers-dont-pay-rubles
https://www.dailycaller.com/2022/03/07/donald-trump-warned-united-nation-relying-russian-oil-german-delegation-laughed
https://www.zerohedge.com/markets/germany-getting-distinct-feeling-deja-vu-about-its-exploding-inflation
https://summit.news/2022/03/29/government-minister-tells-germans-to-cope-with-soaring-energy-costs-by-wearing-warmer-sweaters/
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Bloomberg opinion
SPR isn’t an oil producer but an unusually large pile of inventory, and in commodity markets, shrinking inventories are almost always bullish for prices. A 180 million barrel sale from the current reserve would reduce the stockpile to just 388 million barrels, the lowest levels since 1984 and barely more than half-full. Reserve sales already legislated by Congress will shrink the SPR by a similar amount over the next five years. Pile one reduction on top of the other, and America’s oil in the form of extra crude. Such exchanges, however, have an even worse record than sales, since in the long term they draw more crude from the market than they add to it. One such program to boost heating oil supplies in the first term of the George W. Bush administration ultimately pushed up crude by about 8.5%, according to a 2019 study by the Federal Reserve Bank of Dallas.
Read more at: https://www.bloombergquint.com/gadfly/america-s-oil-reserve-weapon-risks-misfiring
Copyright © BloombergQuint
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We can refill it!
At
TODAY'S
PRICES
Bloomberg opinion
SPR isn’t an oil producer but an unusually large pile of inventory, and in commodity markets, shrinking inventories are almost always bullish for prices. A 180 million barrel sale from the current reserve would reduce the stockpile to just 388 million barrels, the lowest levels since 1984 and barely more than half-full. Reserve sales already legislated by Congress will shrink the SPR by a similar
Read more at: https://www.bloombergquint.com/gadfly/america-s-oil-reserve-weapon-risks-misfiring
Copyright © BloombergQuint
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https://www.cnn.com/2022/03/30/politics/strategic-petroleum-reserve-release-oil-joe-biden/index.html
(biden will restock reserves when prices are lower) - :roll:
(restocking will help boost production). - roll
(due to corona pandemic ). - :roll:
(apping the reserve -- the stockpile of 600 million barrels of crude oil stored in underground salt caverns in Louisiana and Texas -- generally has only a limited effect on gas prices because of how much oil can be released at a time, but would act as a political sign that Biden is continuing to confront the problem.) - :roll: :roll: :roll:
and on and on ..........with the bullshit
that is why Hellboy should be hired as a spokesperson for the Dem Party
he is at least honest - just say FU to us
and get it over with
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https://www.zerohedge.com/markets/german-retailers-increase-food-prices-20-50-monday
Suddenly getting real for der Chermanz.
https://dailyreckoning.com/rickards-ive-never-heard-so-many-lies/
https://www.zerohedge.com/geopolitical/clever-tactics-putin-gets-his-way-rubles-energy-demand
How do you say "Checkmate" in Russian?
https://www.zerohedge.com/energy/basf-ceo-warns-germany-total-collapse-if-russian-gas-supply-cut
https://www.zerohedge.com/commodities/putin-signs-decree-ordering-gas-exports-be-halted-if-buyers-dont-pay-rubles
https://www.dailycaller.com/2022/03/07/donald-trump-warned-united-nation-relying-russian-oil-german-delegation-laughed
https://www.zerohedge.com/markets/germany-getting-distinct-feeling-deja-vu-about-its-exploding-inflation
https://summit.news/2022/03/29/government-minister-tells-germans-to-cope-with-soaring-energy-costs-by-wearing-warmer-sweaters/
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https://www.zerohedge.com/geopolitical/putin-will-collect-321-billion-windfall-partially-thanks-sanctions
https://www.zerohedge.com/markets/german-retailers-increase-food-prices-20-50-monday
Suddenly getting real for der Chermanz.
https://dailyreckoning.com/rickards-ive-never-heard-so-many-lies/
https://www.zerohedge.com/geopolitical/clever-tactics-putin-gets-his-way-rubles-energy-demand
How do you say "Checkmate" in Russian?
https://www.zerohedge.com/energy/basf-ceo-warns-germany-total-collapse-if-russian-gas-supply-cut
https://www.zerohedge.com/commodities/putin-signs-decree-ordering-gas-exports-be-halted-if-buyers-dont-pay-rubles
https://www.dailycaller.com/2022/03/07/donald-trump-warned-united-nation-relying-russian-oil-german-delegation-laughed
https://www.zerohedge.com/markets/germany-getting-distinct-feeling-deja-vu-about-its-exploding-inflation
https://summit.news/2022/03/29/government-minister-tells-germans-to-cope-with-soaring-energy-costs-by-wearing-warmer-sweaters/
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We need Canadian oil and Canada needs a close customer, but somehow it would have to be transported. Sometimes I wonder if we have super powers with the ability to see these things coming! Let's see, we still rely on oil. They have it. Aren't too far away. But transporting it by truck and train is a bitch. Pipelines are 10 times safer, cleaner, more efficient. First time a President killed this type of infrastructure project while it's being built. F'g moron. To give him full credit, he also killed the wall.
https://thefederalist.com/2022/04/06/oops-biden-wants-to-import-more-canadian-oil-but-he-killed-the-keystone-pipeline/
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The Stupid is strong within them.
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The five stages of grief
1. Denial
2. Anger
3. Bargaining
4. Depression
5. Paying in Rubles
https://www.zerohedge.com/geopolitical/putin-will-collect-321-billion-windfall-partially-thanks-sanctions
https://www.zerohedge.com/markets/german-retailers-increase-food-prices-20-50-monday
Suddenly getting real for der Chermanz.
https://dailyreckoning.com/rickards-ive-never-heard-so-many-lies/
https://www.zerohedge.com/geopolitical/clever-tactics-putin-gets-his-way-rubles-energy-demand
How do you say "Checkmate" in Russian?
https://www.zerohedge.com/energy/basf-ceo-warns-germany-total-collapse-if-russian-gas-supply-cut
https://www.zerohedge.com/commodities/putin-signs-decree-ordering-gas-exports-be-halted-if-buyers-dont-pay-rubles
https://www.dailycaller.com/2022/03/07/donald-trump-warned-united-nation-relying-russian-oil-german-delegation-laughed
https://www.zerohedge.com/markets/germany-getting-distinct-feeling-deja-vu-about-its-exploding-inflation
https://summit.news/2022/03/29/government-minister-tells-germans-to-cope-with-soaring-energy-costs-by-wearing-warmer-sweaters/
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https://ace.mu.nu/archives/398613.php
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https://www.foxbusiness.com/politics/democrats-playing-into-putins-hands-when-it-comes-to-us-energy-production-experts?fbclid=IwAR28bn99bk6gMMwi8TrdFBmXG7SUkaHvDBJhX9QrICyeFqDXkjKYPskgKK4
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but with 50 % more royalties or Dem Party theft
not sure how this can help prices if the companies are to be extorted more :
https://www.nationalreview.com/news/biden-administration-resumes-federal-oil-and-gas-leases-but-with-higher-royalties/
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https://www.zerohedge.com/geopolitical/germanys-economic-minister-warned-unrest-if-russian-gas-immediately-cut
The five stages of grief
1. Denial
2. Anger
3. Bargaining
4. Depression
5. Paying in Rubles
https://www.zerohedge.com/geopolitical/putin-will-collect-321-billion-windfall-partially-thanks-sanctions
https://www.zerohedge.com/markets/german-retailers-increase-food-prices-20-50-monday
Suddenly getting real for der Chermanz.
https://dailyreckoning.com/rickards-ive-never-heard-so-many-lies/
https://www.zerohedge.com/geopolitical/clever-tactics-putin-gets-his-way-rubles-energy-demand
How do you say "Checkmate" in Russian?
https://www.zerohedge.com/energy/basf-ceo-warns-germany-total-collapse-if-russian-gas-supply-cut
https://www.zerohedge.com/commodities/putin-signs-decree-ordering-gas-exports-be-halted-if-buyers-dont-pay-rubles
https://www.dailycaller.com/2022/03/07/donald-trump-warned-united-nation-relying-russian-oil-german-delegation-laughed
https://www.zerohedge.com/markets/germany-getting-distinct-feeling-deja-vu-about-its-exploding-inflation
https://summit.news/2022/03/29/government-minister-tells-germans-to-cope-with-soaring-energy-costs-by-wearing-warmer-sweaters/
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https://www.zerohedge.com/markets/full-embargo-russian-oil-would-send-brent-185bbl-jpmorgan
https://www.zerohedge.com/geopolitical/germanys-economic-minister-warned-unrest-if-russian-gas-immediately-cut
The five stages of grief
1. Denial
2. Anger
3. Bargaining
4. Depression
5. Paying in Rubles
https://www.zerohedge.com/geopolitical/putin-will-collect-321-billion-windfall-partially-thanks-sanctions
https://www.zerohedge.com/markets/german-retailers-increase-food-prices-20-50-monday
Suddenly getting real for der Chermanz.
https://dailyreckoning.com/rickards-ive-never-heard-so-many-lies/
https://www.zerohedge.com/geopolitical/clever-tactics-putin-gets-his-way-rubles-energy-demand
How do you say "Checkmate" in Russian?
https://www.zerohedge.com/energy/basf-ceo-warns-germany-total-collapse-if-russian-gas-supply-cut
https://www.zerohedge.com/commodities/putin-signs-decree-ordering-gas-exports-be-halted-if-buyers-dont-pay-rubles
https://www.dailycaller.com/2022/03/07/donald-trump-warned-united-nation-relying-russian-oil-german-delegation-laughed
https://www.zerohedge.com/markets/germany-getting-distinct-feeling-deja-vu-about-its-exploding-inflation
https://summit.news/2022/03/29/government-minister-tells-germans-to-cope-with-soaring-energy-costs-by-wearing-warmer-sweaters/
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https://www.thegatewaypundit.com/2022/04/germanys-inflation-surpasses-30-percent-highest-since-1949/
https://www.zerohedge.com/markets/full-embargo-russian-oil-would-send-brent-185bbl-jpmorgan
https://www.zerohedge.com/geopolitical/germanys-economic-minister-warned-unrest-if-russian-gas-immediately-cut
The five stages of grief
1. Denial
2. Anger
3. Bargaining
4. Depression
5. Paying in Rubles
https://www.zerohedge.com/geopolitical/putin-will-collect-321-billion-windfall-partially-thanks-sanctions
https://www.zerohedge.com/markets/german-retailers-increase-food-prices-20-50-monday
Suddenly getting real for der Chermanz.
https://dailyreckoning.com/rickards-ive-never-heard-so-many-lies/
https://www.zerohedge.com/geopolitical/clever-tactics-putin-gets-his-way-rubles-energy-demand
How do you say "Checkmate" in Russian?
https://www.zerohedge.com/energy/basf-ceo-warns-germany-total-collapse-if-russian-gas-supply-cut
https://www.zerohedge.com/commodities/putin-signs-decree-ordering-gas-exports-be-halted-if-buyers-dont-pay-rubles
https://www.dailycaller.com/2022/03/07/donald-trump-warned-united-nation-relying-russian-oil-german-delegation-laughed
https://www.zerohedge.com/markets/germany-getting-distinct-feeling-deja-vu-about-its-exploding-inflation
https://summit.news/2022/03/29/government-minister-tells-germans-to-cope-with-soaring-energy-costs-by-wearing-warmer-sweaters/
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https://www.thegatewaypundit.com/2022/04/biden-may-illegally-releasing-millions-barrels-oil-strategic-oil-reserves-lowest-level-ever/
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takes time out from his world travel to soothe us by telling us the drilling permits are only temporary
of course leaving out Biden and crew will tax the shit out of the energy companies at the same time :
https://www.breitbart.com/clips/2022/04/22/kerry-expanding-drilling-permits-is-temporary-move-to-keep-the-population-committed-to-moving-to-green/
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https://www.thegatewaypundit.com/2022/04/biden-may-illegally-releasing-millions-barrels-oil-strategic-oil-reserves-lowest-level-ever/
https://www.bloomberg.com/news/articles/2022-04-18/texas-port-sends-strategic-u-s-oil-to-europe-amid-supply-crunch
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Well, if we want them off Russki oil , , ,
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https://www.breitbart.com/politics/2022/04/25/glitch-in-push-for-electric-vehicles-u-s-dependent-on-china-for-battery-components/
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"violated the 1975 Energy Policy and Conservation Act which established the Strategic Petroleum Reserve (SPR), The law prohibits the release of emergency SPR stocks unless there is a severe domestic supply shortage, an act of sabotage or natural disaster,"
[None of those happened.]
- Mark Robeck — former deputy general counsel for energy policy at the Department of Energy (DOE) during the Trump administration — wrote in a Washington Examiner editorial Thursday.
The purpose of this release is to mitigate Democrats losses in the mid-terms.
Unfortunately, a real reduction in inventories signals higher prices coming.
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https://www.zerohedge.com/energy/russia-halts-natural-gas-supplies-poland-european-energy-prices-spike-local-reports
https://www.thegatewaypundit.com/2022/04/germanys-inflation-surpasses-30-percent-highest-since-1949/
https://www.zerohedge.com/markets/full-embargo-russian-oil-would-send-brent-185bbl-jpmorgan
https://www.zerohedge.com/geopolitical/germanys-economic-minister-warned-unrest-if-russian-gas-immediately-cut
The five stages of grief
1. Denial
2. Anger
3. Bargaining
4. Depression
5. Paying in Rubles
https://www.zerohedge.com/geopolitical/putin-will-collect-321-billion-windfall-partially-thanks-sanctions
https://www.zerohedge.com/markets/german-retailers-increase-food-prices-20-50-monday
Suddenly getting real for der Chermanz.
https://dailyreckoning.com/rickards-ive-never-heard-so-many-lies/
https://www.zerohedge.com/geopolitical/clever-tactics-putin-gets-his-way-rubles-energy-demand
How do you say "Checkmate" in Russian?
https://www.zerohedge.com/energy/basf-ceo-warns-germany-total-collapse-if-russian-gas-supply-cut
https://www.zerohedge.com/commodities/putin-signs-decree-ordering-gas-exports-be-halted-if-buyers-dont-pay-rubles
https://www.dailycaller.com/2022/03/07/donald-trump-warned-united-nation-relying-russian-oil-german-delegation-laughed
https://www.zerohedge.com/markets/germany-getting-distinct-feeling-deja-vu-about-its-exploding-inflation
https://summit.news/2022/03/29/government-minister-tells-germans-to-cope-with-soaring-energy-costs-by-wearing-warmer-sweaters/
-
https://www.zerohedge.com/markets/eu-embargo-russian-oil-imminent-germany-drops-opposition
https://www.zerohedge.com/energy/russia-halts-natural-gas-supplies-poland-european-energy-prices-spike-local-reports
https://www.thegatewaypundit.com/2022/04/germanys-inflation-surpasses-30-percent-highest-since-1949/
https://www.zerohedge.com/markets/full-embargo-russian-oil-would-send-brent-185bbl-jpmorgan
https://www.zerohedge.com/geopolitical/germanys-economic-minister-warned-unrest-if-russian-gas-immediately-cut
The five stages of grief
1. Denial
2. Anger
3. Bargaining
4. Depression
5. Paying in Rubles
https://www.zerohedge.com/geopolitical/putin-will-collect-321-billion-windfall-partially-thanks-sanctions
https://www.zerohedge.com/markets/german-retailers-increase-food-prices-20-50-monday
Suddenly getting real for der Chermanz.
https://dailyreckoning.com/rickards-ive-never-heard-so-many-lies/
https://www.zerohedge.com/geopolitical/clever-tactics-putin-gets-his-way-rubles-energy-demand
How do you say "Checkmate" in Russian?
https://www.zerohedge.com/energy/basf-ceo-warns-germany-total-collapse-if-russian-gas-supply-cut
https://www.zerohedge.com/commodities/putin-signs-decree-ordering-gas-exports-be-halted-if-buyers-dont-pay-rubles
https://www.dailycaller.com/2022/03/07/donald-trump-warned-united-nation-relying-russian-oil-german-delegation-laughed
https://www.zerohedge.com/markets/germany-getting-distinct-feeling-deja-vu-about-its-exploding-inflation
https://summit.news/2022/03/29/government-minister-tells-germans-to-cope-with-soaring-energy-costs-by-wearing-warmer-sweaters/
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being sued
for new truck order
by Climate zealots , multiple states, Union bosses in the North Midwest
https://www.yahoo.com/autos/usps-sued-states-climate-orgs-160700437.html
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EVs grounded in France
https://www.france24.com/en/live-news/20220429-paris-suspends-electric-bus-fleet-after-fires
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Russia Could Sell More Energy to Asia, but Has to Slash Prices
Russia wants to sell more oil and coal to China and India, but Western sanctions may make that hard unless Russia offers deep discounts on the price.
Keith Bradsher
By Keith Bradsher
May 3, 2022, 5:00 a.m. ET
Sign up for the Russia-Ukraine War Briefing. Every evening, we'll send you a summary of the day's biggest news. Get it sent to your inbox.
BEIJING — Last year, the Grand Aniva, a Russian tanker with four spherical tanks for holding ultracold liquefied natural gas, sailed back and forth between a gas field in eastern Russia and depots in Japan and Taiwan. But two days after Russia invaded Ukraine, the ship switched routes, sailing to China instead.
The voyages of the tanker, which is as long as three football fields, underlined that President Vladimir V. Putin of Russia can still find buyers in Asia for his country’s fossil fuel exports despite Western sanctions. He needs to look for buyers as governments exact more pressure on his country to try to stop its war in Ukraine, including an expected move in the next several days by the European Union to gradually halt imports of Russian oil.
Mr. Putin called on April 14 for his country “to redirect our exports gradually to the rapidly growing markets of the South and the East.” Two obvious destinations are China, the world’s largest energy market, and India, the world’s third largest. (The United States is No. 2 in energy use.)
But any attempt to shift Russia’s energy exports to Asia from Europe would face major obstacles. Russia would need to offer steep discounts to make its oil and coal exports worth the risk and cost to buyers, and would need to start the yearslong task of building more ports and pipelines for natural gas exports.
Redirecting Russian natural gas to Asia from Europe would require building extremely long pipelines or specialized ports like the one on Russia’s Sakhalin Island from which the Grand Aniva sails. Such ports are able to supercool natural gas so that it condenses into a liquid, which can then be sent by ship.
Sending oil to Asia would also require transportation by ship. But because of Western financial sanctions over the war in Ukraine, insurers are refusing to cover tankers with Russian cargoes. Banks are refusing to lend money for the time that the oil is in transit. So oil companies in countries like India have demanded very steep discounts on the price to cover the extra cost and risks.
Exports of coal, which can be loaded on trucks or trains to China, face the fewest logistical obstacles. But Russia’s coal exports are worth only a tenth as much as its oil exports and a quarter as much as its natural gas exports, data from Russia’s Federal Customs Service shows. And Western sanctions on using dollars for transactions with Russia are dampening Chinese demand for Russian coal.
“Even the private Chinese coal traders these days don’t want to touch Russian coal, because of the fear of Western sanctions,” said Zhou Xizhou, a longtime specialist in Chinese energy who is now at S&P Global.
Despite the obstacles, global energy leaders are betting that Russia can find a way to export at least the oil and the coal, in large part because global demand remains high. The world has been short of energy since autumn, when China nearly ran out of coal and suffered widespread electricity blackouts.
Prices have risen sharply since last year for natural gas and oil as well as coal. Preventing any Russian energy from reaching world markets could drive them even higher.
“This is actually potentially a more significant energy crisis than the 1970s — that was just oil, it was simpler,” said Daniel Yergin, the energy historian and author of books like “The Prize” and “The New Map.”
Some energy industry leaders are calling for policies that do not block Russian energy exports entirely. The goal instead should be to make it very hard for Russia to export, they say, so that it does so only at very low prices.
“The main issue is not to reduce or nullify Russian exports to Europe, but to reduce the Russian oil and gas revenues — they are not the same thing,” Fatih Birol, executive director of the International Energy Agency in Paris, said in a telephone interview.
The expectation is that Mr. Putin will keep the oil and coal moving by holding, in effect, the world’s biggest sale.
Russia needs every dollar of export revenue it can get right now. It is lurching toward default on its foreign debt. It has lost much of its foreign investment. And Western governments have frozen half of its central bank’s foreign reserves.
Russia currently exports nearly five million barrels per day of crude oil and another three million barrels per day of diesel, gasoline and other refined products. China and India have extensive refinery industries and are typically interested in the crude oil, Mr. Birol said.
Natural gas is harder for Russia to export. According to the International Energy Agency, Russia has the capacity to liquefy and load onto ships only about a tenth of its natural gas exports. Most of the shipments that are liquefied have already been going to East Asia anyway, with a lot leaving from the southern tip of Sakhalin Island, near Japan.
According to Marine Traffic, an Athens-based ship tracking service that monitors ships’ locations, the Grand Aniva switched from supplying Japan and Taiwan last year to supplying China in the two months since the Russian invasion.
Rising concerns. Russia’s invasion on Ukraine has had a ripple effect across the globe, adding to the stock market’s woes. The conflict has already caused dizzying spikes in energy prices and is causing Europe to raise its military spending.
The cost of energy. Oil prices already were the highest since 2014, and they have continued to rise since the invasion. Russia is the third-largest producer of oil, so more price increases are inevitable.
Gas supplies. Europe gets nearly 40 percent of its natural gas from Russia, and it is likely to be walloped with higher heating bills. Natural gas reserves are running low, and European leaders worry that Moscow could cut flows in response to the region’s support of Ukraine.
Food prices. Russia is the world’s largest supplier of wheat; together, it and Ukraine account for nearly a quarter of total global exports. Countries like Egypt, which relies heavily on Russian wheat imports, are already looking for alternative suppliers.
Shortages of essential metals. The price of palladium, used in automotive exhaust systems and mobile phones, has been soaring amid fears that Russia, the world’s largest exporter of the metal, could be cut off from global markets. The price of nickel, another key Russian export, has also been rising.
Financial turmoil. Global banks are bracing for the effects of sanctions intended to restrict Russia’s access to foreign capital and limit its ability to process payments in dollars, euros and other currencies crucial for trade. Banks are also on alert for retaliatory cyberattacks by Russia.
The Grand Aniva is one of the few tankers still visiting Russian ports: It is owned by Sovcomflot, a state-owned Russian shipping company that is already the target of Western sanctions.
On its most recent voyage in mid-April, the Grand Aniva went from Sakhalin Island to an L.N.G. unloading port in Beihai, on China’s southern coast. Sinopec, a state-owned Chinese refining giant, built the port and then transferred it three years ago to PipeChina, a separate state-owned enterprise. Sinopec, PipeChina and Sovcomflot did not respond to requests for comment.
Geopolitics help make possible the continued export of Russian energy. China has avoided condemning Russia’s invasion of Ukraine and has a history of buying oil from Iran and Venezuela despite Western sanctions on those countries.
“The Chinese have found workarounds for Iranian oil, for Venezuelan oil,” said Michal Meidan, the director of gas research and China energy at the Oxford Institute for Energy Studies. “They will find workarounds for Russian oil.”
Russia is already increasing natural gas shipments to China through a recently completed Siberian pipeline. But because Russia’s Siberian gas fields are not linked by pipelines to Russian gas fields supplying Europe, there are severe limits on Russia’s ability to shift gas sales to China.
Still, trade between Russia and China, much of it Russian energy exports, jumped nearly 30 percent in the first three months of this year compared with a year earlier. That increase “fully demonstrates the great resilience and internal dynamism of cooperation between the two countries,” Le Yucheng, a Chinese deputy foreign minister, said in a statement last month. “No matter how the international situation changes, China will, as always, strengthen strategic coordination with Russia.”
Russia’s market position might improve in the autumn. Much of Russia’s oil is very heavy, producing extra diesel when refined. Russia exported more than 10 times as much diesel as gasoline last year, data from Russia’s Federal Customs Service shows.
The world’s main diesel market is China, with nearly twice as many heavy-duty trucks in operation as the United States. Coronavirus lockdowns have paralyzed much of China’s fleet in recent days, especially in and around Shanghai.
Diesel demand in China could completely reverse by autumn. Beijing is turning to its favorite tactic in previous economic slowdowns: enormous investment in the construction of more rail lines, roads, bridges and other infrastructure.
All of that construction will require huge fleets of diesel-guzzling trucks, excavators, pile drivers, bulldozers and other equipment.
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second
https://www.cnn.com/2022/05/02/politics/biden-administration-lithium-batteries/index.html?fbclid=IwAR0dqEzPBlGo7L7o_W2oSGPvSnLogzdj1cU08ljHQDqCEMDRHBNjGCTkKHw
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Scroll right and left to see both pictures.
Unleaded 159.9 May 2020, 400.9 May 2022,
Same station 2 years apart:
Diesel 155.9, 505.9, a 225% increase in 2 years!
(https://mcusercontent.com/dc8d30edd7976d2ddf9c2bf96/images/c9f7bb04-4e20-2703-43c6-705d79693543.jpg)
What is criminal is that this economic war is intentional and waged by our government, backed by half the voters, or were you Dem and Biden voters not listening when they told you this was the plan?
Hat tip Stephen Moore
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Are we becoming a Third World Country? [Already there?] That's what you call places in the 20th century, oops now 21st century, who don't have reliable power [and food, etc.]
https://www.wsj.com/articles/electricity-shortage-warnings-grow-across-u-s-11652002380
From the article:
“From California to Texas to Indiana, electric grid operators are warning that power-generating capacity is struggling to keep up with demand, a gap that could lead to rolling blackouts this summer.”
We’ve been warning of this for many months. It’s already been happening in leftist California. Millions of Texans lost power during the polar vortex freeze last year because of renewable energy mandates. (How does Texas run out of energy?) The clear villain here is that Democrat lawmakers (and some Republicans) have joined forces with radical greens to force utilities to use the least reliable sources of power: wind and solar. Thousands of people in recent years have died because of brownouts. No one in America has died from climate change."
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https://www.zerohedge.com/energy/biden-admin-cancels-huge-alaska-oil-and-gas-lease-gas-prices-hit-record-highs
Only going to get worse.
-
https://www.zerohedge.com/commodities/least-20-european-gas-buyers-open-account-gazprombank
The five stages of grief
1. Denial
2. Anger
3. Bargaining
4. Depression
5. Paying in Rubles
-
https://dailycaller.com/2022/05/17/joe-biden-venezuela-oil-production-energy-crisis/?utm_source=piano&utm_medium=email&utm_campaign=2680&pnespid=7uF5U3ofNqUVgvea.W6pF4iStEisCMBsMemzy.dr8QJmLAdKIYnm.fy3Zmf.iwg0.RsYmFSM
-
https://www.bnnbloomberg.ca/vast-swath-of-us-is-at-risk-of-summer-blackouts-regulator-warns-1.1767730
no biggie
WHITE SUPREMACY
the biggest threat :wink:
or due to CLIMATE CHANGE :wink:
nuclear gas is apparently off the table
we need more windmills
and solar panels :wink:
how do we have such shit heads running out country
we are never prepared for anything it seems
-
https://markets.businessinsider.com/news/commodities/russian-oil-production-rebounding-will-keep-rising-alexander-novak-2022-5?fbclid=IwAR1vN5Sq3uhljiIm2coZqe4ek9vH80O3S90c1AgsjL_TYxIKg0xAAFimZAI
-
https://www.zerohedge.com/commodities/us-west-risk-power-blackouts-summer-regulator-warns
Unexpectedly!
Bad luck!
-
Washington Post November 22, 2020
"Conservative predict energy costs spike under Biden. Experts say those fears are overblown."
-------------------------
Oops I guess they were buffoons or operatives, not "experts".
Is a correction and apology forthcoming?
-
https://www.thegatewaypundit.com/2022/06/trump-right-russia-reduces-natural-gas-flow-40-germany/
https://dailyreckoning.com/rickards-ive-never-heard-so-many-lies/
https://www.zerohedge.com/geopolitical/clever-tactics-putin-gets-his-way-rubles-energy-demand
How do you say "Checkmate" in Russian?
https://www.zerohedge.com/energy/basf-ceo-warns-germany-total-collapse-if-russian-gas-supply-cut
https://www.zerohedge.com/commodities/putin-signs-decree-ordering-gas-exports-be-halted-if-buyers-dont-pay-rubles
https://www.dailycaller.com/2022/03/07/donald-trump-warned-united-nation-relying-russian-oil-german-delegation-laughed
https://www.zerohedge.com/markets/germany-getting-distinct-feeling-deja-vu-about-its-exploding-inflation
https://summit.news/2022/03/29/government-minister-tells-germans-to-cope-with-soaring-energy-costs-by-wearing-warmer-sweaters/
-
https://www.businesswire.com/news/home/20220615006025/en/ExxonMobil-statement-regarding-President-Biden-Letter-to-Oil-Industry
——
Shameful, 4 Pinocchio blame assessment by the almost elected President of the United States.
Joe Biden could have led the effort to open ANWR 30 years ago as a Senator. Could have led us to build new carbon free nuclear when he was VP and it would be producing by now. And he still won't do it. Could have promoted clean coal or improved drilling practices. Could have courted the Saudis or dissuaded Russia from invading neighbor and further disrupting supply. Could have allowed a pipeline built to bring much needed from our oil producing neighbor to the North. Could have guided his natural ally Maduro to not destroy oil production. But no. Instead he tells our producers to do more with less. Increased production doesn't work that way. Ask Venezuela about that.
Everything he did took us in the wrong direction.
We should be 80% nuclear by now, instead we are 80% reliant on fossil fuels.
Progressives own the term 'smart planning' but they do everything but that. What they need to do is (how do I say it nicely? ) get the F out of the way of American ingenuity and enterprise. They have a role regulating emissions in this country. The rest is all big government run amok. Now oil prices which are a part of all prices in this country (and the world) will only stop spiraling up only when the economy breaks, because of the evil leadership of the haven't-fully-thought-it-through party.
They wanted us off of fossil fuels, forced us off of fossil fuels, but didn't bother to find or build a suitable replacement first. The result is unavoidable economic disaster - including famine.
-
To their credit, the left is good at putting drag queen sex offenders into schools and turning cities into crime ridden cesspools.
If only we could generate clean energy from used syringes and human feces left on urban sidewalks...
https://www.businesswire.com/news/home/20220615006025/en/ExxonMobil-statement-regarding-President-Biden-Letter-to-Oil-Industry
——
Shameful, 4 Pinocchio blame assessment by the almost elected President of the United States.
Joe Biden could have led the effort to open ANWR 30 years ago as a Senator. Could have led us to build new carbon free nuclear when he was VP and it would be producing by now. And he still won't do it. Could have promoted clean coal or improved drilling practices. Could have courted the Saudis or dissuaded Russia from invading neighbor and further disrupting supply. Could have allowed a pipeline built to bring much needed from our oil producing neighbor to the North. Could have guided his natural ally Maduro to not destroy oil production. But no. Instead he tells our producers to do more with less. Increased production doesn't work that way. Ask Venezuela about that.
Everything he did took us in the wrong direction.
We should be 80% nuclear by now, instead we are 80% reliant on fossil fuels.
Progressives own the term 'smart planning' but they do everything but that. What they need to do is (how do I say it nicely? ) get the F out of the way of American ingenuity and enterprise. They have a role regulating emissions in this country. The rest is all big government run amok. Now oil prices which are a part of all prices in this country (and the world) will only stop spiraling up only when the economy breaks, because of the evil leadership of the haven't-fully-thought-it-through party.
They wanted us off of fossil fuels, forced us off of fossil fuels, but didn't bother to find or build a suitable replacement first. The result is unavoidable economic disaster - including famine.
-
https://dailycaller.com/2022/06/16/oil-companies-industry-refineries-joe-biden/?utm_source=piano&utm_medium=email&utm_campaign=2680&pnespid=7btmEisdLL1GwObL.Du.SZ6R5k_nWppxLLOsmvNtv0Bmc95A4XYw27hZQp6TVTLnPxxOGU4a
-
ET
Israel-Europe Gas Deal Will Transform European Geopolitics and Energy Security
Israel becomes a major player on the world’s energy stage and directly threatens Russian economy and influence in Europe
James Gorrie
Writer
June 17, 2022 Updated: June 17, 2022biggersmaller Print
This week, Israel officially positioned itself as a natural supplier to Europe, one of the largest markets on earth.
The announcement of an agreement signed by Israel, Egypt, and the European Union on June 15 at the East Mediterranean Gas Forum will be a huge deal for both Europe and Israel. The Europeans’ drive to find alternative sources of natural gas is a direct result of Russia’s invasion of Ukraine.
A Big Deal for Europe and Israel
For decades, Europe has relied on Russian natural gas, and Russia’s good graces, for energy. Moscow has repeatedly shut off gas to European nations at will as a way of influencing policy.
Gaining new access to Israeli natural gas allows it to pivot away from Russia as its source for energy, particularly for its natural gas supply.
It’s also a huge advancement for Israel, as it leverages its Leviathan natural gas fields just off its coast in the Eastern Mediterranean as an entree into a global energy supplier. The transportation plan is simple and will allow gas exports to begin sooner than many expected.
A Change in Plans
Initially, the long-term plan had been to build a pipeline from the gas fields in the Eastern Mediterranean to Cyprus, then to Greece, and on into Western Europe. Those plans have been challenged by Turkey, which claims ownership of natural gas. It has also claimed territorial rights to any pipeline that runs through Cyprus or crosses the maritime line that Turkey and Libya have claimed exists between their two countries.
But according to the new agreement, no new pipelines will need to be constructed, at least not right away. Instead, the plan is to use existing pipelines that run from Israel and Jordan to Egypt’s liquified natural gas facilities. From there, the liquified natural gas (LNG) will be transported directly to European markets via existing shipping lanes to European port(s) within a couple of years.
Israel’s Gain Is Russia’s Loss
As exports of LNG to Europe ramp up over the next couple of years, Israel will gain tremendous revenue inflows from its European customers at Russia’s expense. Currently, Europe relies on Russia for about 40 percent of its natural gas supplies. In 2021, that represented $119 billion in annual revenues flowing from Europe to Russia. Revenue flows will be even higher as energy prices continue to rise. Natural gas is nothing short of a strategic asset, as it is the single biggest portion of Russian-European trade, comprising 36 percent of the country’s total budget.
A Diplomatic Victory Across the Arab World
The deal is more than just an economic windfall for Israel. It demonstrates just how well Israel and its Arab partner, Egypt, can work together for their mutual economic benefit.
That message of cooperation and mutual benefit will be seen and heard loud and clear across the Arab and Islamic world. It’s not wishful thinking that Egypt’s cooperation will attract the same from other Arab nations that could benefit from better relations with Israel.
Furthermore, when liquified natural gas shipments begin to arrive in Europe, that will fundamentally alter the balance of power between Russia and Europe.
Bad News for Russia
That’s good news for Europe and Israel, but it’s very bad news for Russia and Vladimir Putin. From an economic standpoint, the impact of Europe ditching Russia as a supplier of both oil and natural gas will be catastrophic for the Russian economy.
Russia may have to find new markets quickly.
It’s worth noting that China is already buying Russian energy, providing Russia with revenues that rival the European market, even at discounted prices—but that may not last forever.
But the Israeli-European gas deal is also very problematic for Russia from a geopolitical perspective. Without the power to sway or punish Europe with threats of withholding natural gas supplies, Russia will have very little else with which to influence European policy.
Indeed, Moscow understands this as well as anyone, which adds a definite level of complexity, if not risk, to the new agreement.
How Will Moscow React?
How, for example, will or could Moscow react to this development?
As noted, it could be considered a threat to Russia, if not an economic act of war. It’s certainly not a deprivation of energy or food per se, but the net effect could be similar.
Moscow could interpret the new natural gas agreement in the context that the EU and Israel (two prominent critics of the Ukraine invasion) are cooperating—if not conspiring—to deprive Russia of its most important market.
That’s true. And it could well cause Russians to suffer great economic hardship. Moreover, Russia’s geopolitical influence in Europe and the rest of the world would diminish as well.
Would Moscow take a wait-and-see attitude toward Israel and the European Union, hoping that it will be able to convince either party not to go through with the deal?
Or would it resort to a naval blockade of natural gas shipments into Europe to protect its economic interests?
Much may depend on the state of the outcome of Russia’s war against Ukraine, which is not readily foreseeable. But once Europe is free of Russian gas, it will no longer be a hostage to Russian blackmail, though it still risks being bullied by Moscow militarily.
That same reasoning also applies to Israel, and it is keenly aware of Russia’s military presence on its northern border. More war from Russia over this deal could be in the cards.
After all, what other card does Russia have to play?
Views expressed in this article are the opinions of the author and do not necessarily reflect the views of The Epoch Times.
-
Too little, too late for euroweenies.
ET
Israel-Europe Gas Deal Will Transform European Geopolitics and Energy Security
Israel becomes a major player on the world’s energy stage and directly threatens Russian economy and influence in Europe
James Gorrie
Writer
June 17, 2022 Updated: June 17, 2022biggersmaller Print
This week, Israel officially positioned itself as a natural supplier to Europe, one of the largest markets on earth.
The announcement of an agreement signed by Israel, Egypt, and the European Union on June 15 at the East Mediterranean Gas Forum will be a huge deal for both Europe and Israel. The Europeans’ drive to find alternative sources of natural gas is a direct result of Russia’s invasion of Ukraine.
A Big Deal for Europe and Israel
For decades, Europe has relied on Russian natural gas, and Russia’s good graces, for energy. Moscow has repeatedly shut off gas to European nations at will as a way of influencing policy.
Gaining new access to Israeli natural gas allows it to pivot away from Russia as its source for energy, particularly for its natural gas supply.
It’s also a huge advancement for Israel, as it leverages its Leviathan natural gas fields just off its coast in the Eastern Mediterranean as an entree into a global energy supplier. The transportation plan is simple and will allow gas exports to begin sooner than many expected.
A Change in Plans
Initially, the long-term plan had been to build a pipeline from the gas fields in the Eastern Mediterranean to Cyprus, then to Greece, and on into Western Europe. Those plans have been challenged by Turkey, which claims ownership of natural gas. It has also claimed territorial rights to any pipeline that runs through Cyprus or crosses the maritime line that Turkey and Libya have claimed exists between their two countries.
But according to the new agreement, no new pipelines will need to be constructed, at least not right away. Instead, the plan is to use existing pipelines that run from Israel and Jordan to Egypt’s liquified natural gas facilities. From there, the liquified natural gas (LNG) will be transported directly to European markets via existing shipping lanes to European port(s) within a couple of years.
Israel’s Gain Is Russia’s Loss
As exports of LNG to Europe ramp up over the next couple of years, Israel will gain tremendous revenue inflows from its European customers at Russia’s expense. Currently, Europe relies on Russia for about 40 percent of its natural gas supplies. In 2021, that represented $119 billion in annual revenues flowing from Europe to Russia. Revenue flows will be even higher as energy prices continue to rise. Natural gas is nothing short of a strategic asset, as it is the single biggest portion of Russian-European trade, comprising 36 percent of the country’s total budget.
A Diplomatic Victory Across the Arab World
The deal is more than just an economic windfall for Israel. It demonstrates just how well Israel and its Arab partner, Egypt, can work together for their mutual economic benefit.
That message of cooperation and mutual benefit will be seen and heard loud and clear across the Arab and Islamic world. It’s not wishful thinking that Egypt’s cooperation will attract the same from other Arab nations that could benefit from better relations with Israel.
Furthermore, when liquified natural gas shipments begin to arrive in Europe, that will fundamentally alter the balance of power between Russia and Europe.
Bad News for Russia
That’s good news for Europe and Israel, but it’s very bad news for Russia and Vladimir Putin. From an economic standpoint, the impact of Europe ditching Russia as a supplier of both oil and natural gas will be catastrophic for the Russian economy.
Russia may have to find new markets quickly.
It’s worth noting that China is already buying Russian energy, providing Russia with revenues that rival the European market, even at discounted prices—but that may not last forever.
But the Israeli-European gas deal is also very problematic for Russia from a geopolitical perspective. Without the power to sway or punish Europe with threats of withholding natural gas supplies, Russia will have very little else with which to influence European policy.
Indeed, Moscow understands this as well as anyone, which adds a definite level of complexity, if not risk, to the new agreement.
How Will Moscow React?
How, for example, will or could Moscow react to this development?
As noted, it could be considered a threat to Russia, if not an economic act of war. It’s certainly not a deprivation of energy or food per se, but the net effect could be similar.
Moscow could interpret the new natural gas agreement in the context that the EU and Israel (two prominent critics of the Ukraine invasion) are cooperating—if not conspiring—to deprive Russia of its most important market.
That’s true. And it could well cause Russians to suffer great economic hardship. Moreover, Russia’s geopolitical influence in Europe and the rest of the world would diminish as well.
Would Moscow take a wait-and-see attitude toward Israel and the European Union, hoping that it will be able to convince either party not to go through with the deal?
Or would it resort to a naval blockade of natural gas shipments into Europe to protect its economic interests?
Much may depend on the state of the outcome of Russia’s war against Ukraine, which is not readily foreseeable. But once Europe is free of Russian gas, it will no longer be a hostage to Russian blackmail, though it still risks being bullied by Moscow militarily.
That same reasoning also applies to Israel, and it is keenly aware of Russia’s military presence on its northern border. More war from Russia over this deal could be in the cards.
After all, what other card does Russia have to play?
Views expressed in this article are the opinions of the author and do not necessarily reflect the views of The Epoch Times.
-
Of course, the contrary argument is "Only if we fold in Ukraine".
-
Of course, the contrary argument is "Only if we fold in Ukraine".
"the plan is to use existing pipelines that run from Israel and Jordan to Egypt’s liquified natural gas facilities. From there, the liquified natural gas (LNG) will be transported directly to European markets via existing shipping lanes to European port(s) within a couple of years"
They don't have time.
-
Of course, the contrary argument is "Only if we fold".
-
Of course, the contrary argument is "Only if we fold".
Please flesh that out for me.
-
The argument would run something like this:
If the fight continues until Europe gains courage from the presumed incipience of this deal coming on stream, then the momentum turns.
-
This would be the same europe that allows muslim rape gangs to openly prey on their women and children, lest they be called racist?
The argument would run something like this:
If the fight continues until Europe gains courage from the presumed incipience of this deal coming on stream, then the momentum turns.
-
OK, so if after all the noise the Cabal Named Biden has made about knocking Russia down now backs off as you suggest (and the deal is likely to suck for what leverage would we have in such negotiations?) what does the geopolitical landscape look like for America in the aftermath of the shame of Afghanistan, the failed bluster in Ukraine, and Iran going nuclear?
-
If I was China, Russia, Iran or anyone else, I'd see the US for what it is. Morally, spiritually and financially bankrupt.
We'll force career warriors out for not taking the ClotShot, but HIV+ deviants are fine to serve.
OK, so if after all the noise the Cabal Named Biden has made about knocking Russia down now backs off as you suggest (and the deal is likely to suck for what leverage would we have in such negotiations?) what does the geopolitical landscape look like for America in the aftermath of the shame of Afghanistan, the failed bluster in Ukraine, and Iran going nuclear?
-
Well, duh.
But my question remains unanswered. If we do as you recommend, does it not add to the accelerating decline dramatically? Whereas if we hold/have some success, does this open the door to re-establishing credibility as an ally?
-
WE
WON"T
EVEN
PROTECT
OUR
OWN
BORDER.
Want to regain credibility? Let's start there.
Baby steps.
Well, duh.
But my question remains unanswered. If we do as you recommend, does it not add to the accelerating decline dramatically? Whereas if we hold/have some success, does this open the door to re-establishing credibility as an ally?
-
Well, certainly a big hearty AMEN on asserting our border, but that still does not get to our credibility after the Iraq exit, the Afghanistan fustercluck, and GM's recommendation of pulling the rug from under the Ukes.
-
Well, certainly a big hearty AMEN on asserting our border, but that still does not get to our credibility after the Iraq exit, the Afghanistan fustercluck, and GM's recommendation of pulling the rug from under the Ukes.
No one takes us seriously, because we aren't a serious nation.
-
https://mises.org/wire/biden-administrations-ignorant-energy-policies-higher-gas-prices-are-only-beginning
-
https://hotair.com/jazz-shaw/2022/05/21/the-coming-blackouts-do-not-say-you-were-not-warned-n471055
Plan accordingly.
-
https://instapundit.com/wp-content/uploads/2022/06/Screen-Shot-2022-06-22-at-8.33.26-AM-600x579.png
(https://instapundit.com/wp-content/uploads/2022/06/Screen-Shot-2022-06-22-at-8.33.26-AM-600x579.png)
https://www.thegatewaypundit.com/2022/04/germanys-inflation-surpasses-30-percent-highest-since-1949/
https://www.zerohedge.com/markets/full-embargo-russian-oil-would-send-brent-185bbl-jpmorgan
https://www.zerohedge.com/geopolitical/germanys-economic-minister-warned-unrest-if-russian-gas-immediately-cut
The five stages of grief
1. Denial
2. Anger
3. Bargaining
4. Depression
5. Paying in Rubles
https://www.zerohedge.com/geopolitical/putin-will-collect-321-billion-windfall-partially-thanks-sanctions
https://www.zerohedge.com/markets/german-retailers-increase-food-prices-20-50-monday
Suddenly getting real for der Chermanz.
https://dailyreckoning.com/rickards-ive-never-heard-so-many-lies/
https://www.zerohedge.com/geopolitical/clever-tactics-putin-gets-his-way-rubles-energy-demand
How do you say "Checkmate" in Russian?
https://www.zerohedge.com/energy/basf-ceo-warns-germany-total-collapse-if-russian-gas-supply-cut
https://www.zerohedge.com/commodities/putin-signs-decree-ordering-gas-exports-be-halted-if-buyers-dont-pay-rubles
https://www.dailycaller.com/2022/03/07/donald-trump-warned-united-nation-relying-russian-oil-german-delegation-laughed
https://www.zerohedge.com/markets/germany-getting-distinct-feeling-deja-vu-about-its-exploding-inflation
https://summit.news/2022/03/29/government-minister-tells-germans-to-cope-with-soaring-energy-costs-by-wearing-warmer-sweaters/
-
https://bigleaguepolitics.com/russia-is-projected-to-rake-in-an-additional-6-4-billion-in-oil-revenue-in-june/
-
(https://mcusercontent.com/dc8d30edd7976d2ddf9c2bf96/images/66eeebb1-2710-317d-333c-5551742e86aa.jpg)
-
URL please?
-
https://mcusercontent.com/dc8d30edd7976d2ddf9c2bf96/images/66eeebb1-2710-317d-333c-5551742e86aa.jpg
(from the CTUP email)
-
Thank you.
-
https://mailchi.mp/a7fcc62397ec/unleash-prosperity-hotline-866848?e=320eaee609
-
https://www.gatestoneinstitute.org/18615/biden-energy-crisis
-
(https://westernrifleshooters.us/wp-content/uploads/2022/06/d87ff80e0d1e8ccc.jpeg)
-
https://www.gatestoneinstitute.org/18663/eu-egypt-israel-gas-exports
-
https://www.thegatewaypundit.com/2022/07/biden-g7-fraternity-threaten-devastate-worlds-economy-analysts-warn-oil-prices-jump-380-barrel/
-
https://www.zerohedge.com/markets/top-german-trade-union-head-warns-entire-industries-may-collapse-amid-worsening-energy
-
https://libertyunyielding.com/2022/07/03/11-per-gallon-gasoline-possible-based-on-prediction-from-major-bank/
-
https://www.zerohedge.com/markets/top-german-trade-union-head-warns-entire-industries-may-collapse-amid-worsening-energy
https://legalinsurrection.com/2022/07/having-scoffed-at-trumps-warnings-germany-now-fears-complete-russian-gas-cut-off/
-
https://instapundit.com/wp-content/uploads/2022/03/BIDENGASPRICES.jpg
(https://instapundit.com/wp-content/uploads/2022/03/BIDENGASPRICES.jpg)
Just reminder who is responsible.
-
https://www.zerohedge.com/markets/social-peace-great-danger-germany-quietly-shutting-down-energy-crunch-paralyzes-economy
Good thing all the "immigrants" they imported will set things on fire to warm everyone up!
https://www.zerohedge.com/markets/top-german-trade-union-head-warns-entire-industries-may-collapse-amid-worsening-energy
https://legalinsurrection.com/2022/07/having-scoffed-at-trumps-warnings-germany-now-fears-complete-russian-gas-cut-off/
-
https://www.zerohedge.com/energy/french-german-leaders-warn-populations-prepare-total-cut-russian-gas-social-unrest-looms
https://www.zerohedge.com/markets/social-peace-great-danger-germany-quietly-shutting-down-energy-crunch-paralyzes-economy
Good thing all the "immigrants" they imported will set things on fire to warm everyone up!
https://www.zerohedge.com/markets/top-german-trade-union-head-warns-entire-industries-may-collapse-amid-worsening-energy
https://legalinsurrection.com/2022/07/having-scoffed-at-trumps-warnings-germany-now-fears-complete-russian-gas-cut-off/
-
https://www.zerohedge.com/markets/world-braces-europes-july-22-doomsday
Spicy times in the EU!
-
https://www.thegatewaypundit.com/2022/07/update-texas-grid-operator-takes-emergency-measures-avoid-rolling-blackouts-wind-turbines-fail-produce-energy-due-low-winds/
-
https://www.thegatewaypundit.com/2022/07/biden-may-choose-help-salmon-instead-fellow-americans/
-
https://twitter.com/JavierBlas/status/1547180581141766144
Germany won't be able to help much against Russia as they freeze to death.
https://www.zerohedge.com/energy/french-german-leaders-warn-populations-prepare-total-cut-russian-gas-social-unrest-looms
https://www.zerohedge.com/markets/social-peace-great-danger-germany-quietly-shutting-down-energy-crunch-paralyzes-economy
Good thing all the "immigrants" they imported will set things on fire to warm everyone up!
https://www.zerohedge.com/markets/top-german-trade-union-head-warns-entire-industries-may-collapse-amid-worsening-energy
https://legalinsurrection.com/2022/07/having-scoffed-at-trumps-warnings-germany-now-fears-complete-russian-gas-cut-off/
-
https://www.zerohedge.com/energy/gazprom-declares-force-majeure-will-halt-gas-flows-germany-indefinitely
https://twitter.com/JavierBlas/status/1547180581141766144
Germany won't be able to help much against Russia as they freeze to death.
https://www.zerohedge.com/energy/french-german-leaders-warn-populations-prepare-total-cut-russian-gas-social-unrest-looms
https://www.zerohedge.com/markets/social-peace-great-danger-germany-quietly-shutting-down-energy-crunch-paralyzes-economy
Good thing all the "immigrants" they imported will set things on fire to warm everyone up!
https://www.zerohedge.com/markets/top-german-trade-union-head-warns-entire-industries-may-collapse-amid-worsening-energy
https://legalinsurrection.com/2022/07/having-scoffed-at-trumps-warnings-germany-now-fears-complete-russian-gas-cut-off/
-
https://www.zerohedge.com/energy/gazprom-declares-force-majeure-will-halt-gas-flows-germany-indefinitely
--------------------------------
For Russia, to shut off the gas is to shut off the cash register.
But there is a world market for oil? To ship it the other direction (FOB Beijing?) and around the world requires pipelines, tankers, infrastructure. He also has to ship oil to his own tanks and planes in Donbas etc.
To the Europeans, to rely on Putin for life depending fuel in latitudes north of Saskatoon was, to say the least, risky business.
Yes. Trump had it right and Palin was mocked for saying what we still needed to do aloud: Drill, baby, drill.
More importantly, Germany shut down nuclear power right when they needed to expand it tenfold. For an inland risk of tsunami? Stupid.
Merkel's governance is not aging well.
-
https://twitter.com/witte_sergei/status/1548697154281033728
-
https://michaelshellenberger.substack.com/p/why-biden-keeps-lying-about-energy
-
It's all just gaslighting as they prepare for "the great reset".
https://michaelshellenberger.substack.com/p/why-biden-keeps-lying-about-energy
-
https://www.thegatewaypundit.com/2022/07/biden-climate-advisor-says-joe-biden-will-move-forward-every-power-available-get-rid-fossil-fuels-video/
It's all just gaslighting as they prepare for "the great reset".
https://michaelshellenberger.substack.com/p/why-biden-keeps-lying-about-energy
-
https://twitter.com/vonderburchard/status/1550398698701656064
“If we don’t get the gas turbine, then we won’t get any more gas, and then we won’t be able to provide any support for Ukraine at all, because then we’ll be busy with popular uprisings.” She immediately backtracked but damage was done.
https://www.zerohedge.com/energy/gazprom-declares-force-majeure-will-halt-gas-flows-germany-indefinitely
--------------------------------
For Russia, to shut off the gas is to shut off the cash register.
But there is a world market for oil? To ship it the other direction (FOB Beijing?) and around the world requires pipelines, tankers, infrastructure. He also has to ship oil to his own tanks and planes in Donbas etc.
To the Europeans, to rely on Putin for life depending fuel in latitudes north of Saskatoon was, to say the least, risky business.
Yes. Trump had it right and Palin was mocked for saying what we still needed to do aloud: Drill, baby, drill.
More importantly, Germany shut down nuclear power right when they needed to expand it tenfold. For an inland risk of tsunami? Stupid.
Merkel's governance is not aging well.
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https://www.zerohedge.com/markets/putin-turns-screws-gazprom-unexpectedly-halts-another-more-nord-stream-turbine-european-gas
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(https://images.squarespace-cdn.com/content/v1/503a5bade4b0b543ed240317/5280edbc-2881-4670-ae60-e2bab9ca48b8/Screen+Shot+2022-07-17+at+11.17.18+PM.png?format=1500w)
Scroll right and look to the top of the chart.
This is not forecast. This is actual.
American SUVs did not cause the 0.01 degree increase in temp last year.
Maybe we could shame China a bit if we put out own grid 100% on carbon-free nuclear.
Chart from: https://www.manhattancontrarian.com/blog/2022-7-17-when-will-they-figure-out-that-reducing-us-carbon-dioxide-emissions-is-pointless
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We are the carbon they wish to eliminate.
(https://images.squarespace-cdn.com/content/v1/503a5bade4b0b543ed240317/5280edbc-2881-4670-ae60-e2bab9ca48b8/Screen+Shot+2022-07-17+at+11.17.18+PM.png?format=1500w)
Scroll right and look to the top of the chart.
This is not forecast. This is actual.
American SUVs did not cause the 0.01 degree increase in temp last year.
Maybe we could shame China a bit if we put out own grid 100% on carbon-free nuclear.
Chart from: https://www.manhattancontrarian.com/blog/2022-7-17-when-will-they-figure-out-that-reducing-us-carbon-dioxide-emissions-is-pointless
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emissions declined only 0.8%. CO2 emissions would have declined more if there had been no wind or solar on the grid.
https://www.caesarrodney.org/pdfs/New_evidence_renewables_dont_reduce_carbon_dioxide_emissions2.pdf
This comparison of actual regional grid carbon dioxide (CO2) emissions between 2019 and 2021 shows increased use of wind and solar did not reduce emissions. Wind and solar electric generation are actually poor technologies no one would use without permanent government mandates and massive subsidies and taxes that are adding $1 billion a year in power cost. They are also unreliable, non-recyclable, have negative environmental impacts, have shorter productive life spans than alternative power sources, and take up a lot of ground. If it doesn’t reduce carbon dioxide emissions why are we using wind and solar?
Study covers 13 states and the District of Columbia. ..
Table 1: PJM electric generation by technology 2019 to 2021
Fuel 2019 2021 Change MWh Change %
Coal 195,288,353 181,354,222 -13,934,131 -7.1%
Oil 833,249 1,469,140 635,891 76.3%
Natural Gas 299,925,492 313,750,191 13,824,699 4.6%
Other Gas 2,941,982 2,882,541 -59,441 -2.0%
Sub Total 498,989,076 499,456,094 467,018 0.1%
Hydro 11,047,831 10,509,639 -538,192 -4.9%
Nuclear 278,794,565 272,524,267 -6,270,298 -2.2%
Bio/wood/landfill 5,574,896 5,650,284 75,388 1.4%
Solar 2,734,753 7,336,368 4,601,615 168.3%
Wind 24,147,354 27,628,094 3,480,740 14.4%
Sub Total 322,299,399 323,648,652 1,349,253 0.4%
Total 821,288,475 823,104,746 1,816,271 0.2%
CO2 systems mix 851.1926 843.3056 7.8870 -0.9%
-
"If it doesn’t reduce carbon dioxide emissions why are we using wind and solar?"
1. It makes stupid people feel good.
2. It puts sweet, sweet taxpayer money in the pockets of the politically connected.
emissions declined only 0.8%. CO2 emissions would have declined more if there had been no wind or solar on the grid.
https://www.caesarrodney.org/pdfs/New_evidence_renewables_dont_reduce_carbon_dioxide_emissions2.pdf
This comparison of actual regional grid carbon dioxide (CO2) emissions between 2019 and 2021 shows increased use of wind and solar did not reduce emissions. Wind and solar electric generation are actually poor technologies no one would use without permanent government mandates and massive subsidies and taxes that are adding $1 billion a year in power cost. They are also unreliable, non-recyclable, have negative environmental impacts, have shorter productive life spans than alternative power sources, and take up a lot of ground. If it doesn’t reduce carbon dioxide emissions why are we using wind and solar?
Study covers 13 states and the District of Columbia. ..
Table 1: PJM electric generation by technology 2019 to 2021
Fuel 2019 2021 Change MWh Change %
Coal 195,288,353 181,354,222 -13,934,131 -7.1%
Oil 833,249 1,469,140 635,891 76.3%
Natural Gas 299,925,492 313,750,191 13,824,699 4.6%
Other Gas 2,941,982 2,882,541 -59,441 -2.0%
Sub Total 498,989,076 499,456,094 467,018 0.1%
Hydro 11,047,831 10,509,639 -538,192 -4.9%
Nuclear 278,794,565 272,524,267 -6,270,298 -2.2%
Bio/wood/landfill 5,574,896 5,650,284 75,388 1.4%
Solar 2,734,753 7,336,368 4,601,615 168.3%
Wind 24,147,354 27,628,094 3,480,740 14.4%
Sub Total 322,299,399 323,648,652 1,349,253 0.4%
Total 821,288,475 823,104,746 1,816,271 0.2%
CO2 systems mix 851.1926 843.3056 7.8870 -0.9%
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https://fee.org/articles/41-inconvenient-truths-on-the-new-energy-economy/?fbclid=IwAR2c8h3tqSVgdVEZmfXLjFaTkxh_OcbxtUoyVfbJV3jfr8m2uYXNYUSoItc
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Using math is racist!
https://fee.org/articles/41-inconvenient-truths-on-the-new-energy-economy/?fbclid=IwAR2c8h3tqSVgdVEZmfXLjFaTkxh_OcbxtUoyVfbJV3jfr8m2uYXNYUSoItc
-
"https://fee.org/articles/41-inconvenient-truths-on-the-new-energy-economy/?fbclid=IwAR2c8h3tqSVgdVEZmfXLjFaTkxh_OcbxtUoyVfbJV3jfr8m2uYXNYUSoItc"
good post
-
"https://fee.org/articles/41-inconvenient-truths-on-the-new-energy-economy/?fbclid=IwAR2c8h3tqSVgdVEZmfXLjFaTkxh_OcbxtUoyVfbJV3jfr8m2uYXNYUSoItc"
good post
Yes. So much to learn there. It costs 400 times more to store energy in batteries than in fossil fuels. What level subsidy overcomes that?
I was disappointed he didn't get to nuclear. 80% of the world's energy comes from fossil fuels. Maybe if we redirected the renewable push to building nuclear power plants we could drop that to 70% or 60% fossil fuels and see a huge reduction in CO2 emissions.
Solar and wind backed up batteries is not the answer.
----------
"Politicians and pundits like to invoke “moonshot” language. But transforming the energy economy is not like putting a few people on the moon a few times. It is like putting all of humanity on the moon—permanently."
"Storing the energy equivalent of one barrel of oil, which weighs 300 pounds, requires 20,000 pounds of Tesla batteries ($200,000 worth)."
- See if that jet or helicopter will fly.
(Mining for those batteries will require digging up 2 million pounds of earth - using fossil fuels?)
-
"https://fee.org/articles/41-inconvenient-truths-on-the-new-energy-economy/?fbclid=IwAR2c8h3tqSVgdVEZmfXLjFaTkxh_OcbxtUoyVfbJV3jfr8m2uYXNYUSoItc"
good post
Yes. So much to learn there. It costs 400 times more to store energy in batteries than in fossil fuels. What level subsidy overcomes that?
I was disappointed he didn't get to nuclear. 80% of the world's energy comes from fossil fuels. Maybe if we redirected the renewable push to building nuclear power plants we could drop that to 70% or 60% fossil fuels and see a huge reduction in CO2 emissions.
Solar and wind backed up batteries is not the answer.
----------
"Politicians and pundits like to invoke “moonshot” language. But transforming the energy economy is not like putting a few people on the moon a few times. It is like putting all of humanity on the moon—permanently."
"Storing the energy equivalent of one barrel of oil, which weighs 300 pounds, requires 20,000 pounds of Tesla batteries ($200,000 worth)."
- See if that jet or helicopter will fly.
(Mining for those batteries will require digging up 2 million pounds of earth - using fossil fuels?)
(Mining for those batteries will require digging up 2 million pounds of earth - using fossil fuels?)
Using children.
https://www.forbes.com/sites/isabeltogoh/2019/12/17/apple-and-tesla-among-tech-giants-being-sued-over-the-deaths-and-injuries-of-child-cobalt-miners-in-drc/?sh=3170a6523107
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Dems oppose safe clean mining done with union labor in MN but don't mind having children slaves do it with no environmental safeguards in third world countries. Go figure.
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https://twitter.com/JavierBlas/status/1552167739674042369
Gaia requires you freeze to death.
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https://twitter.com/JavierBlas/status/1552167739674042369
Gaia requires you freeze to death.
The wind is down so they are burning gas for electricity, gas they should be saving for winter.
The wind is down 70% of the time, it's not a complete surprise...
Every megawatt of wind power requires one megawatt of gas or coal power to back it up, used more than twice as much as the wind power, round the clock forever. The nuclear power they recently shut off didn't require any backup and had no emissions. The gas comes from Russia, not domestic sources. And now war with Russia and pipeline shutdowns. Great plan?
Hard to believe all these Leftists are smarter than us when you see how they govern.
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https://www.theburningplatform.com/2022/07/28/the-power-of-siberia/
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https://www.theburningplatform.com/2022/07/28/the-power-of-siberia/
Outsmarted again.
Imagine if we had a pipeline running from the oil fields of Alberta through the oil fields of North Dakota to the refineries in Houston to the Gulf of mexico. Keystone XL. Oh well, let the commies win.
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"Imagine if we had a pipeline running from the oil fields of Alberta through the oil fields of North Dakota to the refineries in Houston to the Gulf of mexico. Keystone XL. Oh well, let the commies win."
and imagine if we only supplied red states with gas and oil
while the blue states can continue to "rely" on wind and solar .
think of the jobs that could be created is a hundred billion was spent to build water line from
Mississippi to the Left coast..........
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https://www.zerohedge.com/commodities/hawaii-electricity-prices-skyrocket-final-shipment-coal-arrives
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https://michaelyon.locals.com/upost/2511809/germany-powering-down
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https://michaelyon.locals.com/upost/2511809/germany-powering-down
They chose poorly.
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"Life is tough. It is tougher when you are stupid."
John Wayne
Our turn is coming , , ,
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yup
" Europe's catastrophic experience with the "Green transition" where an entire continent moved to "energy alternatives" some 30 years before it was ready to replace fossil fuels, is coming to at least one American state."
green will not be ready in 30 yrs either
it can't be
it is fantasy gobbly-goop
unless we go nuclear
or fission is finally tamed
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https://summit.news/2022/08/03/cost-of-living-crisis-riots-this-year/
Good thing that can't happen here!
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https://www.theburningplatform.com/2022/08/03/suicide-by-monetary-and-energy-policy/#more-274657
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https://summit.news/2022/08/03/spain-bans-air-conditioning-dropping-below-27c/
Spain bans AC below 27 C (80) and heat above 19 (66).
These should be suggestions, not mandates. Strangely, government can't know everyone's circumstance, at every moment, as much as they try.
In other leftist news, air conditioning is/should be a human right.
https://www.scientificamerican.com/article/air-conditioning-should-be-a-human-right-in-the-climate-crisis/
No, moving north (or south) should be a human right - unless you are incarcerated:
https://time.com/4405338/air-conditioning-human-right/
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Strange that the great new green climate deal has nothing for carbon free nuclear.
Dems included support for nuclear power in their party platform 2020, for the first time in 48 years, getting one thing right. Then refuse to do it.
Further proof that these documents and these people lie. And (almost?) never do what is in the nation's best interest.
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https://michaelyon.locals.com/upost/2524560/firewood-in-germany
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Oil is down to $88.
Why?
Biden emptying our oil reserves?
Or?
-
Oil is down to $88.
Why?
Biden emptying our oil reserves?
Or?
Best explanation is from the futures market perspective. Price ran too far up on supply fears and comes down hard on global recession fears.
I don't have data but assume producers made efforts to produce more in response to high prices. That switch doesn't turn on and off quickly or easily with labor, machinery, capacity issues.
-----
Regarding Russia navy post and Russia military threat, we need to drill, drill, drill etc and go BIG and FAST on nuclear for 10 years to end Putin’s career and bankrupt his plans. The threat is China and we don't need the Russian distraction or a China Russia partnership fighting against us.
Energy isn't an industry. It's part of all industries. Run a hospital without power for a day and see. It's part of agriculture we learned, and part of housing, part of life, and military...
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".Energy isn't an industry. It's part of all industries. "
what was that movie decades ago
where some corporate snob was telling someone
EXXON is the United States
with something like NOT DC!
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Global Oil Prices Ease, but for How Long?
9 MIN READAug 8, 2022 | 22:01 GMT
White House Press Secretary Karine Jean-Pierre discusses the recent drop in U.S. gas prices during her daily press briefing in Washington D.C. on Aug. 3, 2022.
White House Press Secretary Karine Jean-Pierre discusses the recent drop in U.S. gas prices during her daily media briefing in Washington D.C. on Aug. 3, 2022.
(MANDEL NGAN/AFP via Getty Images)
Although oil prices have fallen to pre-Ukraine war levels, supply constraints and high risks in global markets could make this recent slide temporary. On Aug. 4, West Texas Intermediate (WTI), the U.S. crude oil benchmark, fell below $90 per barrel for the first time since Feb. 10, two weeks before Russia launched its invasion of Ukraine. The same day, the European crude oil benchmark Brent (which is most commonly used to price other crude grades traded globally) fell below $95 per barrel for the first time since the war began. Since then, WTI has nudged back above $90 per barrel, but as of late Aug. 8, was still just $90.36 per barrel. These developments, however, have coincided with a number of risks on the oil supply side of the market.
During an OPEC+ meeting on Aug. 4, the world's top oil-producing countries agreed to increase production in September by just 100,000 barrels per day (bpd) — around 0.1% of the global oil market. But OPEC+ will likely still fail to reach even that production growth figure, as the bloc's compliance with the production deal was over 300% in the month of June, which signals most producers are already struggling to reach their quotas and will continue to do so.
In the United States, the drop in oil prices was partially caused by an unexpected increase in U.S. crude oil inventories. On Aug. 3, the U.S. Energy Information Administration reported that crude stocks had risen by 4.5 million barrels compared with the previous week — contrasting with industry analysts' forecast, which saw stocks declining by 600,000 barrels during the same time period. This signals a softening in U.S. oil demand, which typically surges in July and August during the busy summer travel season.
Why Are Prices Falling?
The recent decline in oil prices has been primarily driven by an expected drop in global demand amid an increasingly gloomy economic outlook. In late July, the International Monetary Fund slashed its global economic growth projections by 0.4 and 0.7 percentage points for 2022 and 2023, respectively, from its April forecast — citing widespread inflation, the ongoing Ukraine crisis and China's economic slowdown. Within this ''gloomy and more uncertain'' climate, the institution said it now expects the world economy to expand only 3.2% before slowing further to 2.9% next year. On July 28, the United States also reported negative economic growth for the second consecutive quarter — a commonly accepted definition of a recession — in the second quarter. Worsening expectations about the global economy are being buoyed by several forces, including high inflation (induced in part by high oil and natural gas prices) as well as multiple central banks raising interest rates to combat that high inflation — a policy that will choke off economic growth as borrowing costs increase. Within this climate, growth in global oil demand is likely to slow and perhaps turn negative.
Downgrades in expected global economic growth have led the Paris-based International Energy Agency to cut its projection for global oil demand growth in 2022 by 100,000 bpd since its May forecast and in 2023 by 300,000 bpd since its June forecast.
A fragile deal in Libya to bring more oil to the market, along with the potential easing of EU sanctions on Russian exports, has also contributed to the price drop. On the supply side of the equation, the most significant factor has been a deal signed in early July between Libya's political rivals ending a two-month blockade on most of the country's oil exports. The agreement has brought the country's oil production back to 1.2 million bpd, according to Libya's state-owned National Oil Corporation, effectively doubling output from levels reported in late June. The European Union's recent moves to weaken some of its Ukraine-related sanctions on Russian oil have also raised the specter of more Russian oil being available than expected. For example, while the bloc's ban on shipping insurance for Russian oil is still slated to go into effect on Dec. 5, on July 22 the European Union exempted transactions with state-owned Russian companies like Rosneft to allow European trading houses to provide financial services to Russian exports of oil and agricultural products to third countries. This, coupled with the watering down of the original EU oil embargo on Russian oil, suggests the bloc could issue more exemptions as a means to reduce the knock-on effects of sanctions on energy prices.
What Could Send Prices Back Up?
While a global recession may send oil prices lower, risks stemming from the ongoing war in Ukraine could easily push global oil prices back above $100 per barrel — if not much higher. These include:
A gas crisis in Europe: Natural gas prices in Europe have further increased in recent weeks after Russian natural gas giant Gazprom cut throughput on Nord Stream 1 — the most important Russian pipeline to Germany — to just 20% of its capacity. The Kremlin has also repeatedly made veiled threats of cutting off or keeping Europe's natural gas supplies low this winter. Dutch TTF, the largest continental European natural gas benchmark, is trading at around 200 euros per megawatt-hour (MWh), comparable to about $350 per barrel in oil price terms. Gas prices in Europe could surge much higher when demand increases this winter, which would send Europe into a recession. Such a price hike could also result in an oil crisis as energy-starved European countries start substituting oil products for natural gas in certain applications.
A G-7 oil price gap: The developed economies in the Group of 7 (G-7) are also hoping to reach an agreement to cap Russian oil prices at $40 to $60 per barrel. The deal would ideally go into effect before the European Union begins to implement its shipping insurance ban on Dec. 5. Such a cap, however, risks only further increasing global oil prices. Not only has the proposed cap been criticized for being difficult to enforce, but it could trigger Russia to cut oil exports, particularly if the West puts into place strong enforcement mechanisms, such as secondary sanctions targeting Chinese and Indian companies still buying Russian oil. Thus far, the United States has ruled out this move and Russia has refrained from cutting oil exports substantially to put further economic pressure on the West. But the G-7 price cap may lead the Kremlin to cut exports to countries unwilling to violate the price cap or implement a similar ruble-for-oil mechanism that led to many European companies shedding Russian natural gas imports over an unwillingness to pay for gas in rubles. Such moves could also push the United States to abandon its current hesitation over imposing secondary sanctions, further elevating global economic risks, if Russia cuts oil exports first.
Developments unrelated to Ukraine could also send oil prices hurdling in the opposite direction. These include:
Political turmoil in Libya, Brazil and Iraq: Political crisis in major oil-producing nations could shoot oil prices back up by decreasing global supplies. Despite the July deal to end Libya's oil blockade, the country is still mired in a deep political crisis that could lead to the blockade being re-implemented at any time. Indeed, the country still has two political figures claiming to be the country's sole prime minister and both are backed by different armed groups that are currently fighting against one another in the country's capital of Tripoli. But Libya isn't the only major oil producer that could experience a political crisis in the coming months that could disrupt oil production. In Brazil, a country that produces about 3 million bpd, President Jair Bolsonaro has already started to discredit the country's electoral institutions and electoral process in what could presage a disputed election if he loses a narrow vote in the country's October presidential election. In Iraq, a country that produces about 4.4 million bpd, rival Shiite factions are also preventing a government from forming that could lead to rising intra-Shiite violence and more demonstrations at oil sites in the country's Shiite-dominated south.
An Iran nuclear crisis: Although the greatest geopolitical risk remains the Ukraine war, Iran's accelerating nuclear development could also trigger a foreign policy crisis that causes similar turmoil in global oil markets. Iranian officials have repeatedly stated in recent weeks that the country now has the technical capability to build a bomb. Iran's stockpiles of highly enriched uranium to 60% (very close to 90% weapons grade) is already enough to produce a crude nuclear device if enriched further. Indirect negotiations between the United States and Iran to rejoin the 2015 Iran nuclear deal restarted in Vienna on Aug. 4 and EU officials said on Aug. 8 that a final text was ready. But it remains unclear whether Iran will accept the agreement currently on the table, which does not offer Tehran any face-saving concessions from the West.
Looking Ahead
Going forward, the most acute risk will remain a sudden and widespread disruption in Russian oil exports, which is one of the reasons Saudi Arabia and the United Arab Emirates are hesitating to increase production. Saudi Arabia and the United Arab Emirates effectively act as the central bank for the world's oil production. They are also the only two countries with significant spare capacity to increase their oil output. The Arab Gulf neighbors are likely seeking to prepare in case Russia curbs its oil exports and sends prices skyrocketing in retaliation to Western sanctions and/or in an effort to gain leverage against Ukraine and the West in negotiations. In such a worst-case scenario, Riyadh and Abu Dhabi may need to announce a massive production hike to prevent runaway crude oil prices akin to that seen in Europe's natural gas market. Saudi Arabia and the United Arab Emirates are thus likely taking a cautious approach to ensure they have room to quickly ramp production when it matters most. And the limited steps that other OPEC+ members have taken in recent months to boost production, along with the concurrent decline in oil prices amid the world's deteriorating global economic environment, will likely only further validate this approach.
With Russia's oil production currently stymied by Ukraine-related sanctions, Saudi Arabia and the United Arab Emirates are realistically the only OPEC+ members with enough spare capacity bound by the pact to increase production in a meaningful way. As part of the OPEC+ pact, Riyadh and Abu Dhabi agreed to only increase their production by just 26,000 and 7,000 bpd in September, respectively.
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Very interesting!
Off the top of my head I would say that if there is to be such a credit, then the criteria here make sense.
===============================
Most electric vehicles won’t qualify for federal tax credit
BY TOM KRISHER ASSOCIATED PRESS DETROIT | A tax credit of up to $7,500 could be used to defray the cost of an electric vehicle under the Inflation Reduction Act now moving toward final approval in Congress.
But the auto industry is warning that the vast majority of EV purchases won’t qualify for a tax credit that large.
That’s mainly due to the bill’s requirement that, to qualify for the credit, an electric vehicle must contain a battery built in North America with minerals mined or recycled on the continent.
Those rules become more stringent over time — to the point where, in a few years, it’s possible that no EVs would qualify, says John Bozzella, CEO of the Alliance of Automotive Innovation.
The alliance estimates that about 50 of the 72 electric, hydrogen or plug-in hybrid models now sold in the United States wouldn’t meet the requirements.
“The $7,500 credit might exist on paper,” Mr. Bozzella said in a statement, “but no vehicles will qualify for this purchase over the next few years.”
The idea behind the requirement is to encourage domestic manufacturing and mining, build a robust battery supply chain in North America, and lessen the industry’s dependence on overseas supply chains that could be subject to disruptions.
Production of lithium and other minerals that are used to produce EV batteries is now dominated by China. And the world’s leading producer of cobalt, another component of the EV batteries, is the Democratic Republic of Congo.
Under the $740 billion economic package, which passed the Senate over the weekend and is nearing approval in the House, the tax credits would take effect next year. For an EV buyer to qualify for the full credit, 40% of the metals used in a vehicle’s battery must come from North America. By 2027, that required threshold would reach 80%.
If the metals requirement isn’t met, the automaker and its buyers would be eligible for half the tax credit, $3,750.
A separate rule would require that half the batteries’ value must be manufactured or assembled in the North America. If not, the rest of the tax credit would be lost. Those requirements also grow stricter each year, eventually reaching 100% in 2029. Still another rule would require that the EV itself be manufactured in North America, thereby excluding from the tax credit any vehicles made overseas.
Automakers rarely release their components’ origin, but some versions of Tesla’s Model Y and Model 3, the Chevrolet Bolt and the Ford Mustang Mach E likely would be eligible for at least part of the credit because assembled in North America.
The industry says the North American battery supply chain is too small right now to meet the battery component requirements. It has proposed that the measure expand the list of countries whose battery materials would be eligible for the tax credit to nations that maintain defense agreements with the United States, including NATO members.
One component of the bill would require that after 2024, no vehicle would be eligible for the tax credit if its battery components came from China. Most vehicles now have some parts sourced in China, the alliance said.
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https://www.theepochtimes.com/biden-revives-biggest-offshore-oil-and-gas-lease-sale-in-americas-history_4673007.html?utm_source=News&utm_campaign=breaking-2022-08-18-2&utm_medium=email&est=xUcrYUJXt6rVNTIi1yAAk2zelOqp627cBs7TVQTI3AESnclNNntt8Xx9gmLidmWC38DP
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https://www.theepochtimes.com/biden-revives-biggest-offshore-oil-and-gas-lease-sale-in-americas-history_4673007.html?utm_source=News&utm_campaign=breaking-2022-08-18-2&utm_medium=email&est=xUcrYUJXt6rVNTIi1yAAk2zelOqp627cBs7TVQTI3AESnclNNntt8Xx9gmLidmWC38DP
From the article :
"While reinstating lease sale 257 is a positive step forward for American energy leadership, the legislation as a whole falls well short of addressing America’s long-term energy needs,” API Senior Vice President of Policy, Economics, and Regulatory Affairs Frank Macchiarola told The Epoch Times
- Odd. Why would they get do one thing right?
-
To buy a vote?
-
To buy a vote?
Yes. That's it.
I just couldn't figure out how they can be so wrong all day, everyday, and then do something right, especially with fossil fuels.
Some of us out here, even Democrat voters, would still like to heat our homes, drive, fly, charge our phones and have the fridge and the toaster work.
Wouldn't it be great if the ambulances and snow plows and fire trucks all had full tanks of gas when you need them, and if the schools, libraries and government offices had lights that work, if not the homes and factories.
https://www.bloomberg.com/news/articles/2022-08-17/toyota-and-catl-shut-plants-in-sichuan-as-power-crisis-worsens
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https://www.theepochtimes.com/judge-permanently-blocks-biden-oil-and-gas-leasing-pause-in-13-states_4677978.html?utm_source=Morningbrief&utm_campaign=mb-2022-08-21&utm_medium=email&est=7KhaCVc8kK6etHvN8bkqVtgjA3aFyO6k3mPEY3FIEcq6Z%2FGEZ8lnmiA6QCXHTEDGUr59
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Sec. Granholm on Fox:
Free this and 30% off that, yet electricity costs (and inflation) keep going up.
https://www.powerlineblog.com/archives/2022/08/land-of-the-freebie.php
WHY CAN'T PEOPLE SEE THROUGH THIS CRAP?
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"WHY CAN'T PEOPLE SEE THROUGH THIS CRAP?"
you mean that it could 20 yrs to make your money back on switching to solar?
:wink:
MAKE THE DIRTY RICH PAY!!!!!
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Japan PM Kishida orders new nuclear power plant construction
Major shift in energy policy would focus on next-generation types of facilities
https://asia.nikkei.com/Politics/Japan-PM-Kishida-orders-new-nuclear-power-plant-construction
"... plan to restart up to 17 nuclear power plants beginning in the summer of 2023"
"The main objective going forward from 2030 will be to consider construction of next-generation nuclear power plants. The Ministry of Economy, Trade and Industry has already compiled a draft on such plants -- specifically safer, light water reactors -- with plans to start commercial operation in the 2030s."
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[Doug] Who knew that Japan would lead the way in post tsunami nuclear power?
For one thing, it was the diesel generators that failed in the tsunami.
There is no carbon-free energy in our lifetime without nuclear energy.
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Gavin Newsom Spokesman: Greens’ New Energy Proposal Is ‘Fantasy and Fairy Dust’
On the menu today: California governor Gavin Newsom took a long look at his state’s energy needs and concluded that the state’s lone nuclear plant can’t shut down as scheduled in the coming years. Now, his fight with green members of his own state party is heating up faster than . . . well, the planet. Meanwhile, the Florida Democratic gubernatorial primary shook out the way it was expected to, and Florida Democrats had the good sense to reject that Grim Reaper guy. Also, the law holds Nancy Pelosi’s husband accountable.
Don’t Blink: Gavin Newsom Is Getting One Right out There
They keep telling us that California is America’s future. Then again, the dystopian future of Blade Runner was set in California, too.
This morning, the odd and consequential news is that Gavin Newsom — yes, that Gavin Newsom — is on the right side of a political issue, both ideologically and factually. The California governor contends that his state isn’t ready to give up nuclear power, and he’s getting into an increasingly heated fight with environmental activists over keeping the state’s sole nuclear plant open.
The state’s last nuclear-power plant, Diablo Canyon, is scheduled to shut down its two reactors in 2024 and 2025; those reactors currently produce about 9 percent of the state’s electrical energy. Earlier this month, Newsom proposed keeping the two units of the Diablo Canyon online until 2029 and exploring the option of extending the plant’s life through 2035. He’s proposing a $1.4 billion loan from the state’s general fund to Pacific Gas & Electric, the operator of the plant, to cover the cost of relicensing the plant.
Back in May, state energy officials warned that the state’s power grid and supply systems lacked “sufficient capacity to keep the lights on this summer and beyond if heatwaves, wildfires or other extreme events take their toll. . . . The officials forecast a potential shortfall of 1,700 megawatts this year, a number that could go as high as 5,000 MW if the grid is taxed by multiple challenges that reduce available power while sending demand soaring. Supply gaps along those lines could leave between 1 million and 4 million people without power.”
Green Democrats in the state legislature don’t like the idea of keeping the reactors running, and instead are talking up an “alternative” that promotes energy-efficient cooling and lighting and tax credits to the poor for setting up solar panels. If you doubt that California can shut off nearly one-tenth of the state’s electricity-generating capacity and make up for it with new light bulbs and tax credits for solar panels, you’re not alone. Newsom spokesman Anthony York said that the legislators’ proposal “feels like fantasy and fairy dust and reflects a lack of vision and a lack of understanding about the scope of the climate problem.”
You won’t find a bigger cheerleader for alternative energy than Newsom, and the state actually reached a brief point this year when all of the energy being used came from renewables. But Newsom, whatever his other flaws, recognizes that his state’s need for energy isn’t going to shrink in the coming years; a growing economy and population require plentiful energy supplies. California’s official count is that it is home to 39.1 million people; for all the talk of businesses leaving and frustrated residents moving to Austin, the state lost 117,552 residents last year. (It is fair to wonder whether the official figures count everyone; if attempts to cross the border are soaring, it is safe to assume that a healthy chunk of those illegal immigrants are ending up in California.)
The state’s official projections from 2020 foresaw California’s population surpassing 40 million sometime this year, 41 million by 2026, and 42 million by 2031. We can quibble with the precise numbers, but the gist is clear: All those people will need electricity, and renewables by themselves are extremely unlikely to be enough. Without reliable power sources, Silicon Valley will become a ghost town.
In a recent issue of the magazine, Kevin Williamson quoted pro-nuclear climate-change activist Mark Lynas:
‘People have to realize that nuclear is the only zero-carbon source we’ve got that works everywhere all the time. We all know that wind and solar are intermittent, that hydro you can only build in the mountains.’ Nuclear doesn’t have those disadvantages, and it offers one critical geopolitical advantage. ‘With nuclear, you can stockpile fuel so that you have energy security for years at a time, without worrying about Middle Eastern despots and Russian dictators.’
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"They keep telling us that California is America’s future. Then again, the dystopian future of Blade Runner was set in California, too."
Blade Runner CA would be a distinct improvement over current dystopian CA.
Go back an watch the original RoboCop. The Detroit of the movie looks much better than the actual Detroit of today.
Gavin Newsom Spokesman: Greens’ New Energy Proposal Is ‘Fantasy and Fairy Dust’
On the menu today: California governor Gavin Newsom took a long look at his state’s energy needs and concluded that the state’s lone nuclear plant can’t shut down as scheduled in the coming years. Now, his fight with green members of his own state party is heating up faster than . . . well, the planet. Meanwhile, the Florida Democratic gubernatorial primary shook out the way it was expected to, and Florida Democrats had the good sense to reject that Grim Reaper guy. Also, the law holds Nancy Pelosi’s husband accountable.
Don’t Blink: Gavin Newsom Is Getting One Right out There
They keep telling us that California is America’s future. Then again, the dystopian future of Blade Runner was set in California, too.
This morning, the odd and consequential news is that Gavin Newsom — yes, that Gavin Newsom — is on the right side of a political issue, both ideologically and factually. The California governor contends that his state isn’t ready to give up nuclear power, and he’s getting into an increasingly heated fight with environmental activists over keeping the state’s sole nuclear plant open.
The state’s last nuclear-power plant, Diablo Canyon, is scheduled to shut down its two reactors in 2024 and 2025; those reactors currently produce about 9 percent of the state’s electrical energy. Earlier this month, Newsom proposed keeping the two units of the Diablo Canyon online until 2029 and exploring the option of extending the plant’s life through 2035. He’s proposing a $1.4 billion loan from the state’s general fund to Pacific Gas & Electric, the operator of the plant, to cover the cost of relicensing the plant.
Back in May, state energy officials warned that the state’s power grid and supply systems lacked “sufficient capacity to keep the lights on this summer and beyond if heatwaves, wildfires or other extreme events take their toll. . . . The officials forecast a potential shortfall of 1,700 megawatts this year, a number that could go as high as 5,000 MW if the grid is taxed by multiple challenges that reduce available power while sending demand soaring. Supply gaps along those lines could leave between 1 million and 4 million people without power.”
Green Democrats in the state legislature don’t like the idea of keeping the reactors running, and instead are talking up an “alternative” that promotes energy-efficient cooling and lighting and tax credits to the poor for setting up solar panels. If you doubt that California can shut off nearly one-tenth of the state’s electricity-generating capacity and make up for it with new light bulbs and tax credits for solar panels, you’re not alone. Newsom spokesman Anthony York said that the legislators’ proposal “feels like fantasy and fairy dust and reflects a lack of vision and a lack of understanding about the scope of the climate problem.”
You won’t find a bigger cheerleader for alternative energy than Newsom, and the state actually reached a brief point this year when all of the energy being used came from renewables. But Newsom, whatever his other flaws, recognizes that his state’s need for energy isn’t going to shrink in the coming years; a growing economy and population require plentiful energy supplies. California’s official count is that it is home to 39.1 million people; for all the talk of businesses leaving and frustrated residents moving to Austin, the state lost 117,552 residents last year. (It is fair to wonder whether the official figures count everyone; if attempts to cross the border are soaring, it is safe to assume that a healthy chunk of those illegal immigrants are ending up in California.)
The state’s official projections from 2020 foresaw California’s population surpassing 40 million sometime this year, 41 million by 2026, and 42 million by 2031. We can quibble with the precise numbers, but the gist is clear: All those people will need electricity, and renewables by themselves are extremely unlikely to be enough. Without reliable power sources, Silicon Valley will become a ghost town.
In a recent issue of the magazine, Kevin Williamson quoted pro-nuclear climate-change activist Mark Lynas:
‘People have to realize that nuclear is the only zero-carbon source we’ve got that works everywhere all the time. We all know that wind and solar are intermittent, that hydro you can only build in the mountains.’ Nuclear doesn’t have those disadvantages, and it offers one critical geopolitical advantage. ‘With nuclear, you can stockpile fuel so that you have energy security for years at a time, without worrying about Middle Eastern despots and Russian dictators.’
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https://www.zerohedge.com/markets/finland-braces-rolling-blackouts-winter
Between the blackouts and the food shortages, Europe is in for some fun times!
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I've no idea of the specifics of the CA constitution with regard to the Separation of Powers and the Delegation Doctrine, but I'm thinking if the EPA were to try this it would be a violation of our Constitution.
https://dailycaller.com/2022/08/24/california-gas-cars-sales-emissions/?utm_source=piano&utm_medium=email&utm_campaign=2680&pnespid=v7d1VScfJrwY0OjdpTXkEY2HsA2_VYFxdfC5xfIzqBNmddpGGW8tGpvm_ULq0ueDc.6dS179
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US ‘Heavily Dependent’ on China for Rare Earth Elements: Experts
By Andrew Thornebrooke August 24, 2022 Updated: August 24, 2022biggersmaller Print
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The U.S. dependency on China for rare earth elements is a security risk and is being exacerbated by the Biden administration’s forced transition to so-called green technologies, according to lawmakers and experts.
The Biden administration’s top-down push toward renewable energy requires an enormous growth in the mining of rare earth elements. Currently, the United States relies on the mining and processing powers of China, which has far worse environmental regulations, to achieve many of its needs.
“We’re heavily dependent on foreign adversarial nations,” Rep. Pete Stauber (R-Minn.) said during an Aug. 22 interview with NTD, an affiliate media outlet of The Epoch Times. “If today, the communist country of China stopped selling us their critical and rare earth minerals, we would be in deep trouble from our national defense to our manufacturing across the globe.”
Rare earth elements are a number of elements with unique characteristics that have made them vital to new technologies. Critical minerals are those rare earth elements that have no substitute, are limited in supply, or are economically vital.
Stauber’s comments come just weeks after U.S. Treasury Secretary Janet Yellen said the United States would try to end its “undue dependence” on rare earths, which it requires to manufacture various technologies, from solar panels to electric vehicle batteries to smartphones.
“It’s unfortunate that this administration has put their dependency for both critical minerals and rare earth minerals in the hands of the communist country of China,” Stauber said. “It’s simply unacceptable when we have the critical minerals and a few of the rare earths right here in the United States. This administration just won’t let us mine.”
US-RAREEARTHS
Wheel loaders fill trucks with ore at the MP Materials rare earth mine in Mountain Pass, Calif., on Jan. 30, 2020. (Steve Marcus/Reuters)
According to Stauber, the Biden administration lacks the political will to simply mine the needed elements domestically. For example, nickel, copper, and cobalt are all present at extant mining operations in Minnesota. However, instead of allowing U.S. companies to mine these, the administration is pursuing a policy of “friendshoring,” wherein it merely transfers supply chains for offshored goods from China to more friendly nations, such as South Korea.
“We have the best environmental standards, best labor standards, and the opportunity to secure our supply chain dependency and put the destiny of our great nation in the palm of our own hands,” Stauber said.
“It doesn’t have to be this way. We must have an administration that understands the importance of securing our critical minerals and our rare earth minerals. We have to return this country, the United States of America, to mining and mineral dominance. And we can do that, if we have the political will.”
China Weaponizing Rare Earths
Ann Bridges, a Silicon Valley author and policy adviser at the Heartland Institute, said the fear of China weaponizing its growing power of rare and critical elements isn’t without precedent.
“In 2010, Japan and China actually had a conflict over rare earths,” Bridges told NTD. “China responded by cutting off Japan’s access to the rare earths, which really had an impact on Japan’s manufacturing capabilities.
“So it is not outside of the scope of the imagination to believe that in a time of warfare, indeed, China would leverage this kind of power.”
China is the largest global player in many critical minerals, for which demand is currently skyrocketing because of technological development. To that end, Bridges said the administration’s top-down push for electric vehicles and other global climate initiatives could ultimately threaten U.S. security if it’s not more carefully conducted.
“The current administration is all about climate, right, saving the environment?” Bridges said. “A big part of that is the push into electric vehicles, but that needs a lot of rare earth minerals and elements. And then suddenly, it’s like, well, where are we getting that? China?
“We need to be very careful about how we accept kind of a single worldview, whether it’s coming from communist China, whether it’s coming from the World Economic Forum.”
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Right on the money. Good coverage of a critical issue.
From the article:
“We have the best environmental standards, best labor standards, and the opportunity to secure our supply chain dependency and put the destiny of our great nation in the palm of our own hands,” Rep. Pete Stauber said.
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Very interesting politics here. Stauber's congressional district, MN-8 covers a huge part of northern Minnesota which is very beautiful wilderness with lakes and forests and rich with minerals, including the area known as the Iron Range. Rep. Stauber was a national champion and pro hockey player from the port city of Duluth: https://en.wikipedia.org/wiki/Pete_Stauber
From the 1940s to 2010 the region showed solid blue (Democrat) on all the political maps even after most of the non-urban heartland had turned red. Democrat because is was blue collar working people up there, a Democrat strength.
There was a famous legal case where the iron ore company was dumping taconite tailings into Lake Superior (mining waste product), permitted pollution in the face of rising environmental awareness and the origin of the EPA. It was finally shut down by a federal judge in 1980. https://en.wikipedia.org/wiki/United_States_v._Reserve_Mining_Company
In the last 10 or 15 years the arguments have shifted. The mining up there today does not directly pollute but, like a pipeline, has a risk of leakage or pollution, less risk than anywhere else in the world mining is done. The powers in St. Paul (and Washington) want all activity and commerce stopped in the wilderness areas and the people who live there want to make a living - so the politics flipped.
Old mine area have been converted beautiful golf courses, from barren waste back to green and tourism money:
https://www.giantsridge.com/golf/the-quarry/
Everyone has an opinion on mining. One (Dem) relative said, I just don't think they should mine up there (in the pristine wilderness). I said, fair enough, but then don't use those - pointing to his i-phone, and he said, good point, acknowledging the contradiction.
Mining of minerals necessary for solar panels, wind turbines, computer chips, batteries and all electronic devices intended to make fossil fuels obsolete must come from somewhere, cleanest is here.
There are so many contradictions in government. Right now they are trying to mandate we buy things that we are banned from producing. As Stauber suggests, the country (China) we leave to supply it happens to be a communist, totalitarian regime (that we are on the brink of war with). What could go wrong?
Even without the strategic economic and military adversarial issue, allowing China to produce all the world's essential items gives them enormous advantage. A very bad idea.
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https://newatlas.com/energy/aluminum-sulfur-salt-battery-fast-safe-low-cost/
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Watch the market for used cars go nuts when they ban the sale of new gas cars. Also the rush before the ban.
Can't people just buy them somewhere else and bring them in? Is there not freedom to travel between states? Maybe they'll designate the shoulder for gas cars?
Singapore (Island nation state all urban) has a restrictive law regarding new car sales. Must trade in a used car to buy a new one. The used car market is nuts, making new cars and used cars unaffordable to the masses. Just what the Left wants here.
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As usual, it’s not about policy, it’s about power.
Watch the market for used cars go nuts when they ban the sale of new gas cars. Also the rush before the ban.
Can't people just buy them somewhere else and bring them in? Is there not freedom to travel between states? Maybe they'll designate the shoulder for gas cars?
Singapore (Island nation state all urban) has a restrictive law regarding new car sales. Must trade in a used car to buy a new one. The used car market is nuts, making new cars and used cars unaffordable to the masses. Just what the Left wants here.
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https://summit.news/2022/08/25/uk-government-warned-of-civil-unrest-over-people-being-unable-to-pay-energy-bills/
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Greta yes, but Ukraine is not why we will freeze to death.
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Greta yes, but Ukraine is not why we will freeze to death.
Please watch the video for the context.
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Biden’s Push for Electric Vehicles Will Benefit China: House Republicans
By Frank Fang August 25, 2022 Updated: August 25, 2022biggersmaller Print
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The Chinese Communist Party will likely become the beneficiary of President Joe Biden’s push to fill U.S. streets with electric vehicles, according to 16 Republicans on the House Oversight Committee.
The lawmakers, led by the committee’s ranking Republican member, Rep. James Comer (R-Ky.), and Rep. Andy Biggs (R-Ariz.), sounded the alarm in an Aug. 24 letter (pdf) to Transportation Secretary Pete Buttigieg. They wrote that Oversight Committee Republicans are examining “the false claims” made by the Biden administration about the impact of electric vehicles on U.S. jobs.
To rebuke the administration’s claims, the lawmakers pointed out how Ford will cut about 8,000 jobs this summer to “boost profits to fund its push into the electric-vehicle market,” citing a July article from Bloomberg.
Epoch Times Photo
Rep. Andy Biggs (R-Ariz.) speaks during the Rally To Protect Our Elections conference in Phoenix on July 24, 2021. (Brandon Bell/Getty Images)
“Most of the 8,000 jobs will be salaried workers in the United States, representing as much as 25 percent of Ford’s American salaried workers,” they wrote. “Ford is focusing on eliminating employees from its gas-fueled vehicle line.”
Aside from the job cuts, Ford has turned to a Chinese supplier for battery packs. According to a statement from Ford’s website, the U.S. automaker inked a cooperation agreement with China-based Contemporary Amperex Technology Co. Ltd. (CATL) in July. Under the terms of the agreement, CATL will supply electric batteries for certain models of Ford’s electric pickup trucks and SUVs beginning in 2023.
CATL stated that its agreement with Ford allows the two firms to “leverage their respective strengths to jointly explore new business opportunities worldwide.”
However, the lawmakers warned about CATL’s ties to the Chinese communist regime.
“CATL is influential in the Chinese government—being able to independently draft government safety regulations while completely dominating the EV battery market with support from the Chinese government,” they wrote.
CATL, the world’s largest electric vehicle (EV) battery manufacturer, has obtained billions in subsidies from Chinese authorities, according to China’s state-run media outlets. The company’s chairman, Zeng Yuqun, is also a member of the Chinese People’s Political Consultative Conference (CPPCC), a political advisory body.
The CPPCC is currently headed by Wang Yang, former Chinese vice premier and a current member of the Chinese regime’s top decision-making body, the Politburo Standing Committee.
“This raises concerns about whether the push for EVs over gas-fueled vehicles will make America even more reliant on the Chinese Communist Party (CCP) instead of American energy resources,” the lawmakers wrote. “It is troubling that the Administration-endorsed EV future is already eliminating American jobs while benefiting China.”
In August 2021, Biden signed an executive order, with one of the goals being that half of all vehicles sold in the United States in 2030 be zero-transmission vehicles. In May, electric vehicles accounted for 6.1 percent of new cars sold in the United States.
The Inflation Reduction Act, legislation that Biden signed into law on Aug. 16, offers tax credits of up to $7,500 for people buying a new electric vehicle and $4,000 for those purchasing a used one. The tax relief program has been criticized by some Republican lawmakers as benefiting only wealthy Americans, given the higher cost of electric vehicles compared to gasoline models.
Pete Buttigieg
Secretary of the Department of Transportation Pete Buttigieg delivers remarks on new transportation initiatives at an event in the South Court Auditorium at the Eisenhower Executive Office Building on March 7, 2022. (Anna Moneymaker/Getty Images)
Also in their letter, the lawmakers questioned Buttigieg’s statement during a congressional hearing in July, when he said the rise of U.S. domestic clean energy production would be “creating a lot of jobs.”
“As the Secretary for the U.S. Department of Transportation (DOT) and an advocate for Americans’ widespread adoption of EVs, your agency is in a position to explain how Ford’s actions help American workers and the economy,” the letter reads.
The lawmakers wanted Buttigieg to schedule a briefing with Oversight Committee Republicans before Aug. 31.
“We request that you provide the Republican staff of the Committee a briefing to address the loss of American jobs and industry to China and other nations,” the lawmakers wrote.
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https://thegoodcitizen.substack.com/p/europes-virtuous-suicide
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Democrats Obstruct Their Electric Vehicle Push With Surprising Tax Credit Requirements
By Katie Spence August 27, 2022 Updated: August 28, 2022biggersmaller Print
The federal government’s electric vehicle (EV) transition is in full swing, and Democrats have hyped the recent passage of the Inflation Reduction Act (IRA) as an accelerant to that evolution.
Further, gas prices’ continual pounding of consumers at the pump has spurred EV interest to rise to 36 percent, according to a 2022 Consumer Reports survey. That may not sound like much, but it’s a significant increase from the 2020 report, when EV interest was at 4 percent.
Still, one of the hurdles to increased EV adoption is price. On July 12, Kelley Blue Book reported that the average cost of an EV was more than $66,000, while the price for an average gas-powered vehicle was $43,942—a $22,000 difference.
Tesla
Rows of Tesla Model 3 electric vehicles are seen in Richmond, Calif., on June 22, 2018. (Stephen Lam/Reuters)
To help allay concerns about price toward increasing adoption, Democrats proposed an expansion of EV tax credits in the IRA; the credits took effect on Aug. 16. However, since the IRA was enacted, some experts are pointing out that the new credits exclude lower-priced EVs and could phase out entirely in 2023.
Indeed, economically priced EVs from Toyota and Hyundai are now ineligible for EV tax credits, while Audi’s Q5 PHEV (plug-in hybrid EV) and BMW’s 330e qualify for up to $7,500—for now.
Why? Democrats tied the EV credits to an “assembled in North America” requirement, and, in 2023, that includes the battery.
Assembled in North America
Before the IRA went into effect, there were approximately 72 EVs eligible for a tax credit, according to the Alliance for Automotive Innovation industry trade group.
Now, just 16 model year 2022 personal vehicles qualify for the federal tax credit, and only three 2023 models are eligible, according to the Department of Energy. If you’re looking for a commercial vehicle, two 2022 vehicles qualify.
The average manufacturer’s suggested retail price is $54,897 for the 2022 qualifying base models. That price doesn’t include taxes, fees, or other extra charges, trade-ins, or discounts.
Further, only two base models on the list are below $36,000, five are between $43,000 and $47,650, and the remaining nine are between $51,000 and $87,400.
Dream Edition P
People test drive Dream Edition P and Dream Edition R electric vehicles at the Lucid Motors plant in Casa Grande, Ariz., on Sept. 28, 2021. (Caitlin O’Hara/Reuters)
However, starting in January 2023, zero EVs or PHEVs are eligible for the tax credits, Alliance for Automotive Innovation reports.
“The $7,500 credit might exist on paper, but no vehicles will qualify for this purchase incentive over the next few years. That’s going to be a major setback to our collective target of 40-50 percent electric vehicle sales by 2030.”
In the IRA, Senate Democrats added a $4,000 consumer tax credit for lower- and middle-income individuals to buy used “clean vehicles” and up to $7,500 tax credit to purchase new “clean vehicles.” The new vehicle credit caps at $150,000 for a single person and $300,000 for a married couple.
Also, starting Jan. 1, 2023, the previous 200,000-car cap disappears, allowing Tesla and General Motors vehicles to qualify for a tax credit (they’d previously sold more than 200,000 vehicles and met the limit).
Tesla Gruenheide cars
A line of Tesla Model Y electric vehicles at the “Gigafactory” in Gruenheide, southeast of Berlin, on March 22, 2022. (Patrick Pleul/Pool/AFP via Getty Images)
While the IRA’s $7,500 tax credit might sound great if you’re planning to purchase an EV, the law’s North America assembly stipulation means that most previously qualifying EVs are now ineligible.
Additional provisions go into effect on Jan. 1, 2023. They include the requirement that EV battery components contain a certain percentage of minerals from North America or a country with a free trade agreement with the United States.
Plus, most of the battery must be manufactured or assembled in North America.
“That’s going to be a huge burden and hurdle to overcome. We don’t have the mining, we don’t have the critical minerals that are needed in North America or from our free trade partners, and almost 90 percent of the refining is done in China,” Carla Bailo, CEO of the Center for Automotive Research, told NPR.
Domestic Manufacturing Push
On Feb. 22, the Biden administration conceded that the United States increasingly depends on China to refine “cobalt, lithium, rare earth, and other critical minerals” for EV batteries. China controls about three-quarters of the market.
Biden has said that reliance constitutes a “national and economic security” threat. To combat it, he released a statement saying that the United States would expand domestic production and transition away from its reliance on China.
Additionally, on July 28, 2021, Biden released a Notice of Proposed Rulemaking (NPRM), which directed a change to the “Buy American” statute.
“The Buy American statute says products bought with taxpayer dollars must ‘substantially all’ be made in the U.S. However, today, products could qualify if just 55 percent … of the value of their component parts was manufactured here. The NPRM proposes an immediate increase of the threshold to 60 percent and a phased increase to 75 percent.”
The above EV tax credit requirements in the IRA are part of Biden’s domestic manufacturing push.
Indeed, Biden stated that the IRA will “Support American workers with targeted tax incentives aimed at manufacturing U.S.-sourced products such as batteries, solar, and offshore wind components, and technologies for carbon capture systems.”
Still, John Bozzella, president and CEO of the Alliance for Automotive Innovation, stated, “We share the goal of increased domestic capacity and supply, but the requirements ought to be an inducement to industrial base change—not unattainable and punitive to consumers.
“A more gradual phase in of the battery component, critical mineral and final assembly requirements—that better reflect current geopolitical, sourcing and mineral extraction realities—will preserve the credit for millions of Americans and keep the country focused on building domestic supply chains able to support our electrified transportation future,” he added.
The push to reduce the United States’ reliance on China is important, however, neither the United States nor its allies are currently capable of meeting demand, Bozzella said.
If Democrats and the Biden administration insist on maintaining the EV tax credit requirements, it could severely affect the 2030 goal of 40 to 50 percent electric vehicle sales, he said.
Bozzella’s point is weighty when considering the Consumer Reports survey, which found that half of the respondents said they were unaware of federal and state tax incentives. Consumer Reports noted that awareness of this benefit “might sway someone to make an EV purchase.”
Katie Spence
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Not what I was expecting:
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The Obstacles China Will Face in Fixing Its Energy Grid
8 MIN READAug 29, 2022 | 21:12 GMT
Editor's Note: The primary author of this assessment, Satvik Pendyala, is an Applied Geopolitics Fellow at RANE who has conducted significant research over the summer into China's electricity policy.
China's implementation of renewable grid reforms may address longstanding connectivity issues, but the emphasis on transmission infrastructure may raise new concerns about the grid's ability to respond to challenges. China is reinvigorating plans for long-range ultra-high voltage (UHV) power lines to connect underutilized renewable energy supplies to centers of consumption. Beijing is also expanding its plans for and implementation of smart grids to manage the complex flow of electric power across the country as Beijing seeks to advance its carbon reduction commitments, as well as mitigate concerns regarding pollution levels and regional imbalances in power production and consumption. These efforts have the potential to ease the greater challenges currently plaguing China's domestic development — namely, interregional competition, centralization of governance, mismatched regional implementation of national policies, and a poorly optimized electricity grid. If the reforms are enacted, China can finally integrate its renewables into a larger grid to reduce the amount of wasted power generation. An interconnected grid, however, also creates new vulnerabilities. And this, combined with climate-related shortages of hydroelectricity, may result in more power disruptions in the future.
For the next few years, China's electricity policy will focus on grid interconnectivity, peripheral installed capacity, and introducing ''smart grid'' technologies.
China has been continuing to develop the West-East Transmission grid project, which aims to connect the country's more power-generating provinces in the west with the more power-consuming provinces in the east. Significant UHV lines and generation infrastructure has already been constructed as part of the project, with more slated to be built over the coming year.
China's 14th Five-Year Plan, released in 2021 and updated in March 2022, emphasizes ''smart grid'' management along with UHV transmission and storage, increasing the central government's ability to track local grids given the interprovincial connectivity of such a smart grid system
In April, China's Central Comprehensively Deepening Reforms Commission (CCDRC) announced that environmental performance would be a key part of future cadre evaluation for promotion, which suggests local cadres may align their environmental policies with Beijing's to advance their careers.
Through these grid projects, Beijing is hoping to address the connectivity issues that have plagued its renewable sector. China's installed renewable capacity has rapidly expanded over the past decade. In 2010, solar and wind power together comprised only 3% of installed capacity, but as of 2020, they comprised nearly 25%. China has also invested billions in installing renewable energy in western, peripheral provinces. Connectivity issues, however, have hindered the utilization of this newly installed power capacity. Due to over-construction, renewables in China have had a high rate of ''curtailment,'' which is the amount of potentially generated energy that was not delivered to the grid. This largely stems from local governments in China building power capacity without concern for integration into the national network due to development incentives and regional development evaluations. For China's power grid, this scattershot approach to the energy transition has come at the cost of reduced efficiency and reliability.
Curtailment rates for renewables in China have often spiked above 8% over the last decade. The curtailment rate for wind energy in the country temporarily decreased after the central government imposed limits on renewable construction in 2017. But in 2020, wind and solar developments exploded amid the reintroduction of government subsidies, which has increased China's curtailment rate by causing the country's potential power capacity to further exceed absorption ability. So far, in 2022, Inner Mongolia and Qinghai reportedly face curtailment rates of up to 10-12% for renewables (the U.S. state of California, by comparison, averaged about a 3% curtailment rate in 2021).
Hydropower makes up the largest portion of China's installed renewable capacity. But in recent years, extended droughts related to climate change have significantly reduced the reliability of this energy source by leaving dams without enough water to generate electricity. In provinces like Yunnan, low rainfall in 2020 and 2021 reduced hydropower generation by 30% in some months. Sichuan — which relies on hydroelectricity for 80% of its power generation — is also currently facing a major ongoing drought, which recently forced the province to implement power cuts for industrial operations. Nonetheless, new dams have just finished construction in southwestern China and more are scheduled to be built.
The underutilization of installed renewable capacity in China partially reflects central-local and inter-regional policy disagreements on electricity production and transmission. Beijing's policy priorities are codified in its Five-Year Plans, but their implementation is left to local officials who must balance those central priorities against their region's economic and social interests. The Chinese government financially incentivizes provinces to develop local renewable energy sources by offering subsidies, guaranteed pricing and feed-in tariffs, which has resulted in oversupply and inadequate connections for built installed capacity. Another form of regional protectionism arises when local energy providers provide tax revenue for provincial governments, which incentives cadres to buy power from local power generators (and deters them from relying on inter-provincial transmitted power). This often results in the propping up of unprofitable companies, insecure financing for renewable ventures, and an unwillingness to fully utilize national UHV transmission lines.
For China's power grid, this scattershot approach to the energy transition has come at the cost of reduced efficiency and reliability. In August 2021, the NDRC reprimanded several provinces for failing to maintain ''low energy intensity,'' a measure of how efficiently energy gets turned into economic output. In 2020, China also failed to meet its 15% national energy intensity reduction goal laid out in its 13th Five-Year Plan. In the wake of these failures, China modified its energy intensity caps to encourage renewable energy production and greater efficiency, as well as bolster renewable usage and grid connections, while phasing out traditional energy generators. But grid disruptions have nonetheless continued to draw widespread attention.
In September 2021, due to coal shortages and concerns about industrial power use, the Chinese government ordered power-intensive industries to slow operations, which caused production delays. This iteration of cuts spanned many northern provinces and extended until December. Since then, power cuts have resumed amid a series of heat waves and droughts, which have increased the demand and slashed hydropower capacity.
China's energy plans can significantly reduce curtailment and promote regional interconnectivity in the long term. The political capital of leading renewable investment is not lost on Chinese leaders, who are keen on bolstering its domestic production of renewable components with an international market in mind. ''Smart grid'' technology, in particular, has been a major focus for the export market. Many countries that look to Beijing for energy leadership may request China to help upgrade their own grids.
Popular sentiment in coastal provinces has been to shift pollution- and land-intensive energy production out to China's western regions. As the central government is politically dominated by coastal provinces, Beijing has been massively investing in solar and wind power in the west, with Xinjiang alone planning to increase its solar and wind capacity to 80 gigawatts by 2025. This is bolstered by new UHV lines meant to increase transmissions eastward, contrary to regional protectionism that prioritizes local generation. Recent power cuts have tempered Beijing's ambitions, but have not slowed projects aimed at increasing China's peripheral generation and transmission. As of July, major interconnectivity projects are set to finish before the end of this year, such as the Huadian Jinshang Suwalong hydropower station in Sichuan.
The West-East Transmission project, connecting as far west as Xinjiang and Tibet to as far East as Jiangsu and Anhui, is expected to accelerate in the coming years. As this transmission grid matures, and as more provinces are connected out west and renewables are further able to deliver electricity, China will once again be able to bring its curtailment rates under control.
But this reform push will also come with trade-offs, including:
Increased risk of social unrest. As China increases its focus on renewables and prioritizes energy transmission, local traditional power generators in some areas risk going bankrupt, leaving people without jobs. In areas that are heavily dependent on coal-fired power generation, like Inner Mongolia and Shaanxi, unemployment in local energy sectors may cause social unrest and disrupt the implementation of the improved grid.
Potential for construction-related outages. There are some risks inherent in the construction of UHV lines. They are points of failure that increase the risks of outages by sabotage or accident. These lines become critical nodes, which may serve as points of reduced physical redundancy for the grid.
Continued vulnerability to extreme climate events. China's grid remains heavily dependent on hydropower generation in the West. This will leave the country's power grid vulnerable to supply disruptions as climate change increases the length and severity of droughts and, in turn, decreases the generative capacity of China's rivers. Such disruptions may eventually force China to walk back some of its more ambitious renewable transition goals and/or scale up non-hydropower energy sources. Beijing could also possibly look to nuclear to replace hydroelectricity as the base power load of its grid.
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https://media.gab.com/cdn-cgi/image/width=1050,quality=100,fit=scale-down/system/media_attachments/files/114/663/422/original/f46de6a5b312bd24.png
(https://media.gab.com/cdn-cgi/image/width=1050,quality=100,fit=scale-down/system/media_attachments/files/114/663/422/original/f46de6a5b312bd24.png)
:roll:
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https://media.gab.com/system/media_attachments/files/114/665/048/playable/ebf42791276aec08.mp4
Then the platform collapsed and crushed NATO.
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https://media.gab.com/system/media_attachments/files/114/665/048/playable/ebf42791276aec08.mp4
Then the platform collapsed and crushed NATO.
https://justthenews.com/world/europe/russian-oil-sales-roaring-despite-sanctions
"Russia is swimming in cash," Elina Ribakova, deputy chief economist at the Institute of International Finance, told The Wall Street Journal.
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https://www.forbes.com/sites/nicholasreimann/2022/08/27/energy-emergencies-declared-after-bp-refinery-fire-in-indiana/?sh=2cc85e275bfa
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https://www.nakedcapitalism.com/2022/08/will-europe-go-down-to-defeat-before-ukraine.html
The greatest depression.
Self-inflicted.
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https://www.nakedcapitalism.com/2022/08/will-europe-go-down-to-defeat-before-ukraine.html
The greatest depression.
Self-inflicted.
https://www.zerohedge.com/energy/how-name-god-shocked-europeans-post-astronomical-energy-bills-terrifying-winter-approaches
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https://www.nakedcapitalism.com/2022/08/will-europe-go-down-to-defeat-before-ukraine.html
The greatest depression.
Self-inflicted.
https://www.zerohedge.com/energy/how-name-god-shocked-europeans-post-astronomical-energy-bills-terrifying-winter-approaches
https://www.zerohedge.com/geopolitical/eu-declares-energy-crisis-emergency-us-will-not-be-immune
The decline has been fairly gradual. This winter is when things go over the cliff.
-
"This winter is when things go over the cliff."
- What about global warming? The age of winter is over, I was told.
If Europe has no money and has no heat, how many people die?
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"This winter is when things go over the cliff."
- What about global warming? The age of winter is over, I was told.
If Europe has no money and has no heat, how many people die?
A lot. Even more die from disease, violence and starvation. Civil wars.
Governments will collapse.
Either the imported savages will create their islamic states on european soil, or they will become one with the soil.
Cage match, win or die.
Good thing that can't happen here!
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http://www.realclearpolitics.com/video/2022/08/31/tucker_carlson_electronic_vehicles_are_a_disaster_for_the_energy_grid_the_environment_and_your_personal_autonomy.html
-------
And this:
https://www.dailymail.co.uk/news/article-11165279/Californians-urged-not-charge-electric-cars-just-weeks-ban-gas-cars.html
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Is that when liberals will abandon the fight against fossil fuels.
"Boeing 747 uses approximately 1 gallon of fuel (about 4 liters) every second. Over the course of a 10-hour flight, it might burn 36,000 gallons (150,000 liters). According to Boeing's Web site, the 747 burns approximately 5 gallons of fuel per mile (12 liters per kilometer).
[Doug: What is the weight of a battery that would contain that amount of energy?]
This sounds like a tremendously poor miles-per-gallon rating! But consider that a 747 can carry as many as 568 people. Let's call it 500 people to take into account the fact that not all seats on most flights are occupied. A 747 is transporting 500 people 1 mile using 5 gallons of fuel. That means the plane is burning 0.01 gallons per person per mile. In other words, the plane is getting 100 miles per gallon per person! The typical car gets about 25 miles per gallon"
https://science.howstuffworks.com/transport/flight/modern/question192.htm
One small flaw in the straw comparison. If not for air travel, one would not make an unnecessary 8000 mile round trip flight to Europe or a 15,000 round trip to Asia. You aren't going to drive there
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Don't worry, when the left is done, there won't be international flights, except for the elites on their private jets.
Is that when liberals will abandon the fight against fossil fuels.
"Boeing 747 uses approximately 1 gallon of fuel (about 4 liters) every second. Over the course of a 10-hour flight, it might burn 36,000 gallons (150,000 liters). According to Boeing's Web site, the 747 burns approximately 5 gallons of fuel per mile (12 liters per kilometer).
[Doug: What is the weight of a battery that would contain that amount of energy?]
This sounds like a tremendously poor miles-per-gallon rating! But consider that a 747 can carry as many as 568 people. Let's call it 500 people to take into account the fact that not all seats on most flights are occupied. A 747 is transporting 500 people 1 mile using 5 gallons of fuel. That means the plane is burning 0.01 gallons per person per mile. In other words, the plane is getting 100 miles per gallon per person! The typical car gets about 25 miles per gallon"
https://science.howstuffworks.com/transport/flight/modern/question192.htm
One small flaw in the straw comparison. If not for air travel, one would not make an unnecessary 8000 mile round trip flight to Europe or a 15,000 round trip to Asia. You aren't going to drive there
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https://www.imetatronink.com/2022/08/the-us-is-making-russia-incredibly.html
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Brits are looking at 80% increases in electric utility bills this fall because of their unworkable green energy policies. The Sun newspaper In the UK just published what this means for the cost of using common household appliances - from hairdryers to TVs to the stove to washers and dryers.
https://unleashprosperitynow.us19.list-manage.com/track/click?u=dc8d30edd7976d2ddf9c2bf96&id=89b92fe256&e=17d44a0477
Good thing that can't happen here. Oops, already did.
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quote author=G M
Don't worry, when the left is done, there won't be international flights, except for the elites on their private jets.
--------------------
I thought you were going to say, there won't be any international flights because there will be only one 'nation'.
In my anecdotal world, it is the left more than the right that needs to cross the ocean in order to have dream vacation.
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quote author=G M
Don't worry, when the left is done, there won't be international flights, except for the elites on their private jets.
--------------------
I thought you were going to say, there won't be any international flights because there will be only one 'nation'.
In my anecdotal world, it is the left more than the right that needs to cross the ocean in order to have dream vacation.
Food will be a luxury dream. Forget vacations.
(https://i.kym-cdn.com/photos/images/original/001/636/794/0f8.jpg)
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I want the URL to that Greta-bugs meme!
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I want the URL to that Greta-bugs meme!
https://i.kym-cdn.com/photos/images/original/001/636/794/0f8.jpg
(https://i.kym-cdn.com/photos/images/original/001/636/794/0f8.jpg)
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Thank you, I will be playing this forward!
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https://www.zerohedge.com/markets/european-private-jet-demand-soars-rich-avoid-travel-chaos
Stay in your pod and eat your bugs, peasant!
quote author=G M
Don't worry, when the left is done, there won't be international flights, except for the elites on their private jets.
--------------------
I thought you were going to say, there won't be any international flights because there will be only one 'nation'.
In my anecdotal world, it is the left more than the right that needs to cross the ocean in order to have dream vacation.
Food will be a luxury dream. Forget vacations.
(https://i.kym-cdn.com/photos/images/original/001/636/794/0f8.jpg)
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https://www.cnn.com/2022/09/02/energy/nord-stream-1-pipeline-turned-off/index.html
"plan accordingly"
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drilling slows while we deplete the strategic reserve for political purposes. What.could.go.wrong.
https://www.washingtonexaminer.com/restoring-america/courage-strength-optimism/oil-and-gas-rig-count-falls-despite-high-global-demand
We SHOULD have enough natural gas in particular to stabilize our market and sell tankers of LNG to Europe.
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https://gatesofvienna.net/2022/09/the-winter-war/
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https://gatesofvienna.net/2022/09/the-winter-war/
(https://media.gab.com/cdn-cgi/image/width=1050,quality=100,fit=scale-down/system/media_attachments/files/115/122/205/original/92479804f6e51958.jpg)
https://media.gab.com/cdn-cgi/image/width=1050,quality=100,fit=scale-down/system/media_attachments/files/115/122/205/original/92479804f6e51958.jpg
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Useful chart (though Russia-Europe thread probably would have been better). Just posted it on my FB page.
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Alternative energy advocates rethink nuclear opposition
Power source is clean, reliable
BY RAMSEY TOUCHBERRY THE WASHINGTON TIMES
Nuclear power, once shunned by many Democrats and environmentalists, is gaining acceptance among the party and activists as a clean alternative to fossil fuels amid soaring energy costs and a sluggish transition to renewables.
Proponents argue that the carbon- free energy source is clean and affordable, can be generated around the clock and is already prevalent. Wind and solar power, meanwhile, are intermittent and hamstrung by limited battery storage capabilities.
“There’s been a slow progression, but sufficient modeling that has been done has convinced a lot of people in the environmental community, certainly around the importance of preserving the existing fleet,” said Doug Vine, director of energy analysis at the nonpartisan Center for Climate and Energy Solutions. “There’s a recognition of not wanting to backslide on emissions reductions.”
Evidence of the changing tune among climate hawks is prevalent.
Democrats pumped billions of dollars into nuclear tax incentives in their recently approved tax and climate spending legislation.
Included were production credits for existing facilities and incentives to create smaller reactors that are more affordable, quicker to build, safer to operate and last more than six decades.
As part of last year’s bipartisan infrastructure bill, $6 billion was allocated toward the country’s aging nuclear facilities. The Department of Energy’s top nuclear official, Kathryn Huff, recently told the Washington Examiner that the Biden administration is also focused on boosting domestic uranium enrichment, which is vital for nuclear energy production, to rely less on Russian supplies.
California and its Democratic leaders have reversed course and approved legislation to extend the life of its lone nuclear plant. They feared the scheduled closure of the Diablo Canyon facility could result in power shortages for years.
In a recent op-ed in The Sacramento Bee titled “Why I changed my mind about California’s Diablo Canyon nuclear plant,” Sen. Dianne Feinstein of California said the state “must consider every measure to counter the coming onslaught” of natural disasters.
“If California is to lead the clean energy transition, as state law mandates, Diablo must keep operating, at least for the time being,” the Democrat wrote.
Public sentiment has shifted slightly on nuclear power, though the country remains largely split.
A Pew Research poll from May 2021 showed that 47% opposed expanding nuclear energy. A Pew survey from January showed 26% opposed nuclear power and an increasing number, 37%, struck a neutral stance.
The U.S. had 54 nuclear plants, home to 92 reactors, operating in 28 states as of May. The average age of nuclear plants is 40 years, according to the U.S. Energy Information Administration. Since 1990, nuclear power has accounted for about 20% of the country’s annual electricity production and makes up roughly half of all carbon-free electricity.
Over the past eight years, the U.S. has lost more than 10 gigawatts of nuclear power from 13 reactors, or the ability to power more than 5 million homes with zero emissions, Mr. Vine said.
Doug True, vice president and chief nuclear officer of the Nuclear Energy Institute, said the incentives in Democrats’ tax and climate spending plan, dubbed the Inflation Reduction Act, will put “nuclear on the same level playing field as renewables.”
“Nuclear is one of those tools that can provide reliable power 24/7-365, as we’ve demonstrated over the last 50 years in a way that even renewables and storage would have difficulty,” he said at a recent event hosted by the U.S. Energy Association.
The fresh look at nuclear energy extends far beyond American borders, particularly in countries reliant on oil and natural gas imports that want to become more energy independent.
Japanese Prime Minister Fumio Kishida directed his government last month to begin building smaller and safer nuclear reactors to meet its energy needs and its 2050 carbon-neutral deadline. The move marked a sharp reversal for the country, which shuttered many of its plants after the 2011 Fukushima nuclear disaster and said it would focus only on restarting plants.
South Korea reversed plans to phase out nuclear plants this year, and the United Kingdom wants to make nuclear power a pillar of its energy strategy. Prime Minister Boris Johnson recently greenlighted a multibillion-dollar plant.
Plenty of environmentalists still oppose nuclear power for multiple reasons, including costs, safety and hazardous waste disposal.
Greenpeace International considers nuclear energy “dirty, dangerous and expensive.” The Natural Resources Defense Council, which has a “Nuclear Power 101” page devoted to explaining “how its costs outweigh its benefits,” advocated against saving California’s Diablo Canyon plant.
“Late August in Sacramento is notorious for ill-considered proposals that could never survive rigorous analysis or inclusive public review and are never seen again,” Ralph Cavanagh, co-director of the council’s energy program, wrote in a recent Los Angeles Times op-ed. “This one should be soundly rejected.”
The Russia-Ukraine war has also renewed debates and concerns about nuclear energy. Russia’s shelling and takeover of some of Ukraine’s nuclear plants have been characterized as incredibly irresponsible and dangerous and prompted fears of a catastrophe like Chernobyl.
“You can’t design anything for war,” Bud Albright, president and CEO of the U.S. Nuclear Industry Council, said during the U.S. Energy Association event. “If you’re at war, bombs falling, you don’t design architecture for that, whether it’s a power plant or buildings.”
The nation’s aging nuclear facilities got a $6 billion shot in the arm from the infrastructure bill last year. The Biden administration wants the plants to stay open to continue producing a carbon-free source of power that helps combat climate change. ASSOCIATED PRESS
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"burning wood still supplies more than five times the amount of global energy than all the world’s solar panels"
- https://www.manhattan-institute.org/the-energy-transition-delusion
[Doug] Eliminate heating oil, natural gas and coal and that ratio gets worse, no matter how much of the globe we cover with solar panels.
84% of the world's energy comes from fossil fuels. (Only nuclear on a massive scale could rock that balance.)
(https://media4.manhattan-institute.org/sites/default/files/figure-1-Growth-in-Global-Energy-Supplies.png)
https://media4.manhattan-institute.org/sites/default/files/figure-1-Growth-in-Global-Energy-Supplies.png
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They, being the party in power, US anyway, intentionally cut energy supplies and intentionally drove up energy costs.
What happens when energy costs soar (like it's never happened before)?
Real people get hurt. All of them. Businesses go out of business, especially manufacturers, and those jobs disappear.
News item:
"60%™of UK manufacturers may not survive the current energy price hikes."
https://www.makeuk.org/news-and-events/news/out-of-control-energy-bills-are-now-business-threatening-for-60-of-manufacturers
(This is not just UK.)
Well surprise, surprise, surprise.
Who saw THIS coming?
And out of all this, nothing got greener.
To call them f**king morons is to ignore the INTENTIONAL aspect of it.
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They, being the party in power, US anyway, intentionally cut energy supplies and intentionally drove up energy costs.
What happens when energy costs soar (like it's never happened before)?
Real people get hurt. All of them. Businesses go out of business, especially manufacturers, and those jobs disappear.
News item:
"60%™of UK manufacturers may not survive the current energy price hikes."
https://www.makeuk.org/news-and-events/news/out-of-control-energy-bills-are-now-business-threatening-for-60-of-manufacturers
(This is not just UK.)
Well surprise, surprise, surprise.
Who saw THIS coming?
And out of all this, nothing got greener.
To call them f**king morons is to ignore the INTENTIONAL aspect of it.
They think poor, hungry, desperate people will be easy to control.
Sometimes they are, and sometimes they hang politicians in fits of rage.
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https://www.youtube.com/watch?v=Um3OIf8ugjY&t=7s
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https://dailycaller.com/2022/09/08/uk-lifts-fracking-ban-combat-energy-crisis/?utm_source=piano&utm_medium=email&utm_campaign=2680&pnespid=ubh2EztZKrFCw.zd_T63HJeUvQ63VMNpPLKly7NtowFmIxuDumlovM7Ots_trKAdb0616UHi
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https://dailycaller.com/2022/09/08/uk-lifts-fracking-ban-combat-energy-crisis/?utm_source=piano&utm_medium=email&utm_campaign=2680&pnespid=ubh2EztZKrFCw.zd_T63HJeUvQ63VMNpPLKly7NtowFmIxuDumlovM7Ots_trKAdb0616UHi
File that under "Too little, too late".
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"Too little, too late"
Yes, to help in the moment, but she did do it her first day in office.
Biden shut down a world changing pipeline his first day in office. Within a year we had war and famine.
We heard ANWR would take 10 years to develop (so why bother), that nuclear power plants take 10 years to build (so why bother) - for the past 30 + years. We should have bothered. Today they would power both gas and electric cars, and heat homes, with a little air conditioning for Calif too
Oil and gas operate in futures markets. If all the governments started reversing all the anti-energy policies now, you'd be surprised how quickly the impact would hit the consumer.
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In one sense, yes too late.
OTOH a very important signal on her first day both to the energy sector and the British people.
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https://www.zerohedge.com/energy/europe-facing-energy-disaster-and-its-going-bleed-over-us
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quote author=G M
https://www.zerohedge.com/energy/europe-facing-energy-disaster-and-its-going-bleed-over-us
Trade war tactics: In revenge for you shooting a hole in the bottom of your boat, I shoot a hole in the bottom of mine.
The pipeline wasn't built to benefit Europe. It was built for mutually beneficial trade. Both win. Now both lose. It's Europe's energy supply but it's Russia's cash register.
Russia can sell instead out the back door to China. Oops that's an 11 time zone difference. What's it cost to pipe or ship it the other way? More I presume.
Russia knows what it has to do to end sanctions. Now we see if Europe has a backbone.
Regarding our (US) energy disaster, how many nuclear power plants were in that one trillion dollar "infrastructure" bill? There was enough money printed to build hundreds of them, maybe thousands. It was in the 2020 Dem party platform. Just a headfake?
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"Russia can sell instead out the back door to China. Oops that's an 11 time zone difference. What's it cost to pipe or ship it the other way?"
As I have previously mentioned, the basic idea is that central Asian/Russian gas will go to China and west Russian gas will go to Russia, Belarus/Hungary, etc.
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quote author=G M
https://www.zerohedge.com/energy/europe-facing-energy-disaster-and-its-going-bleed-over-us
Trade war tactics: In revenge for you shooting a hole in the bottom of your boat, I shoot a hole in the bottom of mine.
The pipeline wasn't built to benefit Europe. It was built for mutually beneficial trade. Both win. Now both lose. It's Europe's energy supply but it's Russia's cash register.
Russia can sell instead out the back door to China. Oops that's an 11 time zone difference. What's it cost to pipe or ship it the other way? More I presume.
*In a classically Chinese way, China is already selling Europe Russian gas at a serious markup and desperate Europe is pretending to not know it's origin.*
Russia knows what it has to do to end sanctions. Now we see if Europe has a backbone.
*Backbone? You do not seem to grasp the magnitude of just how fcuked Europe is.*
Regarding our (US) energy disaster, how many nuclear power plants were in that one trillion dollar "infrastructure" bill? There was enough money printed to build hundreds of them, maybe thousands. It was in the 2020 Dem party platform. Just a headfake?
*The Inflation Creation Act was as many before it, about the graft, not about creating energy. Energy just magically happens, and if it doesn't it's because of racism and Trump.*
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"You do not seem to grasp the magnitude of just how fcuked Europe is."
In a suicide, is the person a victim or a killer?
If Europe freezes to death this winter, it might save my life with the lesson learned.
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Cheaper electric vehicles coming despite high battery costs
BY TOM KRISHER ASSOCIATED PRESS WARREN, MICH. | Even though battery costs are rising, auto companies are rolling out more affordable electric vehicles that should widen their appeal to a larger group of buyers.
The latest came Thursday from General Motors, a Chevrolet Equinox small SUV with a starting price somewhere around $30,000 and a range-per-charge of 250 miles. You can get a range of 300 miles if you pay more.
GM won’t release the exact price of the Equinox EV until closer to the date it goes on sale, about this time next year. But the SUV is at the low end of Edmunds.com’s list of prices for electric vehicles sold in the U.S., where the average cost of an EV is around $65,000. Hitting a price around $30,000 and a range per charge close to 300 miles is key to getting mainstream buyers to switch away from gasoline vehicles.
“You’re kind of at that sweet spot,” said Ivan Drury, director of insights for Edmunds.com. “You’re basically at the price point that everyone is clamoring for.”
Auto industry analysts say that if the Equinox makes efficient use of interior space with plenty of cargo and passenger room, and if it is styled similar to current gaspowered small SUVs, it should be a hit in the most popular segment of the U.S. auto market. About 20% of all new vehicles sold in the U.S. are compact SUVs.
“It’s a perfect vehicle for a lot of different users, whether it’s a small family, maybe an empty nester,” said Jeff Schuster, president of global forecasting for LMC Automotive, a Detroit-area consulting firm. “You’ve got space to haul things, but it’s easy to drive.”
A $30,000 EV that checks all of the boxes is just a little above the price of a comparable small gaspowered SUV. The Toyota RAV4, the top seller in the segment and the top-selling vehicle in the U.S. that isn’t a pickup, starts at just over $28,000. Until the last few years, electric vehicles were either expensive and aimed at affl uent luxury buyers, or cheaper but with limited travel ranges.
For example, a base version of Tesla’s Model 3, the lowest-price model from the top-selling EV brand in the U.S., starts at more than $48,000. A larger Tesla Model X SUV starts at over $120,000.
The only EVs with starting prices under $30,000 (including shipping) now are versions of the Nissan Leaf and Chevrolet Bolt. Both are smaller than a typical gaspowered compact SUV. The Mini Cooper Electric, Mazda MX30 and Hyundai Kona Electric are in the $30,000s, according to Edmunds.
Kia’s Niro EV, Hyundai’s Ioniq 5, Ford’s F-150 Lightning pickup, the Volkswagen ID. 4, Kia EV6, Toyota b24x, Ford’s Mustang Mach E, Audi’s Q4 e-tron, the Subaru Solterra, Polestar 2, and Tesla Model 3 all have starting prices in the $40,000s.
GM may find it difficult to keep the Equinox price around $30,000, largely because minerals such as lithium, copper, cobalt and nickel that are key components of batteries have been rising fast. There’s a finite number of mines and increasing demand as nearly all automakers introduce new EVs
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https://www.yahoo.com/finance/news/biden-may-buy-oil-just-212325051.html
the stupidity is just endless.....
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https://www.yahoo.com/finance/news/biden-may-buy-oil-just-212325051.html
the stupidity is just endless.....
Right. they have no regrets, because the party of free sh*t is buying free energy with free money - in their little minds. They're buying votes, not oil, with your money.
Maybe they won't replace the oil they are stealing. Because oil is bad.
The hypocrisy is unfathomable. Even if they admit they are buying votes with taxpayer oil, they are admitting voters care about gas prices at the pump. Wouldn't those voters choose the other team?
Diesel prices (like for producing and distributing FOOD) and heating oil (for heating homes) have NOT come down.
One degree of warming per century isn't going to fix that.
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Can Green Hydrogen Save the Planet?
How to Unleash the Potential of New Energy Technology
By S. Julio Friedmann
September 15, 2022
https://www.foreignaffairs.com/world/can-green-hydrogen-save-planet
If climate change is the challenge of the century, hydrogen could be the dark-horse solution. So far, it has received little attention compared with other options to reduce greenhouse gas emissions, such as solar or electric vehicles, but that is changing fast. Money and labor are flowing into hydrogen companies, projects, and infrastructure, almost all of them focused on producing hydrogen supplies that emit little to no carbon, thanks to rapid and profound technology and policy advances. Since 2020, developers have announced more than 150 new hydrogen production projects, now exceeding 250 gigawatts of new power production (roughly ten times all renewable power added by China last year and three times the renewable power additions for the whole world). Public policy is helping. At least 35 countries across the globe have developed formal hydrogen strategies—including Canada, Chile, Germany, India, Japan, the Netherlands, Qatar, Saudi Arabia, and the United Kingdom—because they see clean hydrogen as both essential for addressing climate change and a huge opportunity for trade and commercial competitiveness.
Until recently, hydrogen was used chiefly to make ammonia and refined fuels. Most of that hydrogen has come from processes that use fossil fuels with no abatement measures, which add 500 million tons of carbon dioxide to the atmosphere each year, or about one percent of all global greenhouse gas emissions. In contrast, most of today’s enthusiasm and investment is going toward using hydrogen as a fuel itself or for making new clean fuels. And rather than rely on the old processes that pump carbon dioxide into the atmosphere, there is an intense focus on making “green” hydrogen, which instead uses clean electricity from solar, wind, hydro, or nuclear power to split water into its component parts: hydrogen and oxygen. The approach is simple—it is performed in chemistry classes worldwide—and it requires no combustion and has few moving parts. Investment in these technologies puts green hydrogen center stage for the future production of widely available clean fuels.
Five years ago, this excitement for green hydrogen would have surprised many energy and climate experts, who saw hydrogen as an unlikely player in the future energy mix. In earlier economies, hydrogen couldn’t compete as a fuel. It was simply too expensive, as were solar and wind power, and abundant alternatives were available, including coal, natural gas, and crude oil. Early attempts to make hydrogen a larger part of the economy focused on its use in automobiles, which would have required wholesale changes to fueling infrastructure and factory floors.
The need to address climate change is spurring interest in hydrogen, and new policy measures, along with remarkable technological progress, are making its production a practical reality. Over 137 countries have committed to reaching “net zero” by 2050, meaning they will reduce their greenhouse gas emissions to as close to zero as possible and offset whatever cannot be eliminated by planting trees or taking carbon out of the atmosphere by other means. Major corporations are making similar pledges. Over 320 companies have committed to reaching net zero by 2040. Behind these promises is simple climate math: to stabilize climate change at any level, all sectors everywhere, including electricity, transportation, food, and manufacturing, must effectively reach zero and stay there forever.
That inflexible arithmetic drives production of enormous amounts of green hydrogen to serve those goals. The International Energy Agency has estimated that global green hydrogen production must increase 400-fold by 2050 to make net-zero emissions possible. In addition to ambitious climate goals, advances in technology also enable the shift to green hydrogen. Ten years ago, green hydrogen was wildly more expensive than its dirtier cousins (especially “gray” hydrogen, which is made from natural gas or coal). Most notably, the dramatic decrease in the cost of generating wind and solar power has brought the possibility of scaling up green hydrogen production into the realm of the politically possible.
Green hydrogen’s promise is finally coming into focus. Ramping up its production and diversifying its use will create risks and challenges along the way. To realize the full potential of green hydrogen in the fight against climate change, countries must invest in infrastructure and set the right policies to mitigate the inevitable risks when a new energy market quickly goes commercial.
THE PROMISE
As a clean fuel, hydrogen is quite extraordinary. It burns hot: 2,100 degrees Celsius. That is hot enough to make cement, glass, and steel. It is light—the lightest in the universe—which helps maintain efficiency as a transportation fuel. When run through a fuel cell, it generates electricity on demand. It can combine with other compounds to make fertilizer, liquid fuels, and plastics. Most important for reducing the effects of climate change, these uses emit zero greenhouse gases directly, making hydrogen a destination fuel and feedstock in a net-zero-emissions economy. Burning hydrogen yields water, suitable for drinking or recycling into hydrogen. Plus, once isolated, hydrogen can serve as the main building block to produce other clean fuels, most important, ammonia—another dark horse in the decarbonization race because it emits no carbon when used, has high energy density, and is easily stored and shipped. Hydrogen is also the main building block for fertilizer and other important products, such as explosives and cleaning liquids. Because hydrogen and its derivative products can be stored in tanks and salt caverns indefinitely, it can meet surges in demand during seasonal power variations and stand ready at shipping terminals.
But the process to make pure hydrogen and turn it into a useful product requires energy, and that energy may not always be clean. Natural gas is used to produce gray hydrogen, but the process emits carbon dioxide, exacerbating the climate change problem. When that carbon dioxide byproduct is captured or stored underground, the resulting hydrogen is referred to as “blue” hydrogen, which can be very clean and low in carbon. Biomass, ranging from wood chips to trash, can be chemically changed into biohydrogen, with or without carbon capture. Both these processes can generate very low-carbon hydrogen but require feedstocks (coal, methane, or municipal wastes) that must be mined, stored, shipped, and then converted, with the byproduct carbon dioxide stored underground.
In contrast, the production of green hydrogen requires only three things: fresh water, electrolyzers to split water into its atomic elements, and low-carbon electricity to power the process. It can therefore be produced from low-cost renewable power—namely, solar, wind, and hydro—and other ultra-low carbon electricity, such as nuclear power. Any location with enough fresh water and clean electricity options can become a hydrogen energy superstar. One unlikely example is Chile, which appears to have achieved the lowest generation cost so far because it has superb solar, wind, and hydropower resources—some of the best on earth. Chile has launched ambitious plans for green hydrogen products to generate ten percent of its GDP by 2040. In July, the EU announced a multibillion-dollar investment in green hydrogen production in Namibia, which also has exceptional solar and wind resources. The hydrogen will be used to make ammonia, which will be shipped to Europe and used for energy and food production. It should also produce jobs and new wealth for Namibians.
At least 35 countries across the globe have developed formal hydrogen strategies.
Described as a sort of Swiss Army knife for climate change, hydrogen has potential applications in electricity generation, transportation, and agribusiness. But the most promising application for green hydrogen is heavy industry. Manufacturing of concrete, steel, and chemicals is a huge source of global emissions. These hard-to-decarbonize sectors can’t run on electricity easily or at all. Their range of potential alternative fuels is small, and almost all continue to emit greenhouse gases. For these sectors, hydrogen and its derivative products will be extremely attractive when venting greenhouse gases is no longer accepted or allowed. An example of what the future could look like is the HYBRIT—“hydrogen breakthrough ironmaking technology”—steel plant in Sweden, which has produced the first fossil-free steel using green hydrogen from hydro and nuclear power. HYBRIT is such a rip-roaring success that Sweden’s national steel company has announced that it is replacing all its blast furnaces with similar green-hydrogen-fueled systems.
The eventual price of green hydrogen may be the secret to its success. Most experts agree that between 2030 and 2040, green hydrogen will be produced in many major markets below $2 per kilogram. While this is still roughly 50 to 100 percent more than what gray hydrogen costs today, it is an acceptable cost for many industries and countries. Chile has already declared that it can make hydrogen below $2 per kilogram, and that may soon be true of western Saudi Arabia and northwest Australia, where mammoth projects are under development to produce green hydrogen and ammonia. Projects in the works in Canada, Colombia, the United Kingdom, and the United States also reflect the expectation that demand for clean hydrogen will grow and costs will eventually come way down.
THE DRAWBACKS
Like all other solutions that promise lower greenhouse gas emissions, green hydrogen faces substantial obstacles to quickly scaling up. The biggest is the lack of infrastructure. The United States has only about 1,000 miles of hydrogen pipelines, a relatively meager amount. (It has 100 times more natural gas pipeline miles, which cannot be readily reused for hydrogen.) There is also the problem of power transmission. Chokepoints in the electric grid limit the ability not only to add renewable power but also to bring it to urban and industrial centers, where the electricity-intensive electrolyzers must operate.
Because hydrogen is so light and so small, it’s very hard to ship and store. Hydrogen molecules are small and slippery and are commonly stored at super high pressures or super low temperatures, which adds energy and capital costs. Few ports can ship or receive hydrogen or ammonia, and virtually none have facilities to fuel ships, boats, trucks and dock engines with either fuel, even ports with large industrial demands. This lack of infrastructure to generate, move, and store hydrogen is common to most countries, developed and developing alike. Although some policies have made new infrastructure investments possible, current limits will create chokepoints for this decade and beyond.
Cost is another challenge. In many markets, green hydrogen is still much more expensive than gray or even blue hydrogen—typically four to eight times more expensive. Although some herald green hydrogen as lower cost than hydrogen made from natural gas (blue or gray), such predictions assume a physical scaling up of production that has not yet occurred. They also assume that renewable power generation will run at high capacity, producing electricity more than 75 percent of the time. But that level of uptime can be maintained in only a handful of places on earth—typically regions with abundant hydropower or a combination of abundant solar and wind, such as Chile, Namibia, and northwest Australia, generally far from global demand centers. Moreover, supply chain crunches and critical material shortages are driving up costs for both renewable power equipment and for electrolyzers.
Finally, scaling of hydrogen may present unexpected climate and environmental risks. One example is leakage, which is when hydrogen escapes into the air from production sites, use sites, or pipelines. A lot of leakage would extend the life of some greenhouse gases such as methane or nitrous oxides in the atmosphere, further warming the planet. If countries begin to rapidly scale up their production without properly regulating and monitoring it—which all countries fail to do today—that could lead to substantial hydrogen leakage. Although hydrogen and ammonia can be used safely, massively scaling up their use around the world would add millions of potential leak points without proper oversight and regulation. Similarly, spills and leaks of hydrogen-based fuels (such as ammonia) pose environmental challenges that must be managed, as with gasoline or crude oil spills and leaks.
NEW POWER PLAYERS
The geopolitical implications of a shift from fossil fuels to green hydrogen could prove profound. For one thing, it will create new fuel providers that will compete with current providers. Some petrostates have ample green and blue hydrogen resources, so they will be able to maintain some of their power and leverage, but many new countries are coming online and could disrupt the status quo. Many of these countries are in the global South, including Chile, Colombia, Indonesia, Morocco, Namibia, and Uruguay, and clean energy production could bring wealth to them as it has to petrostates in the past. Current consumers of fossil fuels and chemicals, such as India, have rolled out ambitious domestic green hydrogen production programs, first to make fertilizer and then to help decarbonize their heavy industry. Big players in the green hydrogen market will compete for market share with emerging blue hydrogen powerhouses, including Canada, Nigeria, and the United States. And they will compete for major buyers, such as China, Japan, South Korea, Singapore, and, of course, the EU. This fight to win buyers and capture markets is reflected in the recent blizzard of bilateral agreements—two nations agreeing to dedicated production and purchase of hydrogen and ammonia. Japan and Chile inked such a deal, as did the EU and Namibia, but they are not alone; over 80 bilateral agreements across dozens of nations support production and trade of hydrogen and its derivative products.
As the forces of technology innovation, geopolitics, the desire for economic growth, and diverse natural resources are converging, new policies are being developed that combine climate, innovation, and trade. This merging of policy is clearest in Japan. The country’s banks are financing the production of green hydrogen in Australia and Chile, which will deliver clean fuel for Japan to use in its ports, power plants, and industrial sites. In Japan, government incentives are encouraging clean power production, clean transportation, and clean manufacturing, thereby surmounting the direct consumer cost from clean hydrogen. Taking a holistic policy approach such as Japan’s helps overcome classic “chicken and egg” problems. In short, Japan is building chickens—dedicated hydrogen and clean fuel production around the world and a market to buy the products. This takes the risk out of green hydrogen production through underwriting, industrial policy, and infrastructure development. At the core of these deals are long-term agreements to take hydrogen at guaranteed (fixed) prices. Many other countries are doing the same, including Singapore, South Korea, and some EU members.
The United States has also entered the fray. The Infrastructure Investment and Jobs Act, passed by Congress in November 2021, committed $8 billion to construction and operation for four hydrogen hubs to produce, store, ship, and use hydrogen. Congress has also added billions of dollars for new renewable generation, transmission lines, and port infrastructure. But that was just the opening act. Congress then passed the Inflation Reduction Act in August 2022. Most notably, the law created a new class of tax credits, known as Title 45V, which provide tax breaks for clean hydrogen production. This new tax credit is indexed to the carbon intensity of different types of production, with the cleanest hydrogen production receiving $3 per kilogram, dramatically lowering the total cost for green hydrogen. The best solar, wind, hydro, and nuclear projects in the United States would receive this direct-pay incentive, allowing easier access to markets.
Green hydrogen faces substantial obstacles to quickly scaling up.
The European Green Deal, a blueprint of carrots and sticks by the European Commission to meet stricter climate goals, features grants, tariff relief, and subsidies for green hydrogen production, providing an estimated $500 billion in incentives. European interest in green hydrogen has grown after the invasion of Ukraine, with many governments eyeing green hydrogen as a medium-term alternative to Russian gas while remaining true to their climate goals. In many ways, this flood of government investment encourages private investment and resembles the kind of bilateral policies and deals seen in the early days of liquid natural gas production and shipping 20 years ago. Back then, governments made similar long-term commitments to encourage large private-capital investments in liquid natural gas infrastructure.
Given the government support and private-sector investment, it is easy to be optimistic about the trajectory of green hydrogen. Climate advocates can feel good that its falling production costs should make the world’s 2050 climate goals easier to achieve than they were just five years ago. Those who focus on energy security see a way to diversify fuel supplies and reduce the power of individual geopolitical actors. Organized labor sees jobs. Banks see returns. Those concerned with global equality see a chance to shrink the gap between the global North and the global South. Still, care and attention will be required as this new energy market grows. In theory, there’s no difference between theory and practice. In practice, there is. Although the journey to green hydrogen will be a bumpy ride, the optimism is warranted, and the hype is justified
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Oh boy! Another green scam!
Can Green Hydrogen Save the Planet?
How to Unleash the Potential of New Energy Technology
By S. Julio Friedmann
September 15, 2022
https://www.foreignaffairs.com/world/can-green-hydrogen-save-planet
If climate change is the challenge of the century, hydrogen could be the dark-horse solution. So far, it has received little attention compared with other options to reduce greenhouse gas emissions, such as solar or electric vehicles, but that is changing fast. Money and labor are flowing into hydrogen companies, projects, and infrastructure, almost all of them focused on producing hydrogen supplies that emit little to no carbon, thanks to rapid and profound technology and policy advances. Since 2020, developers have announced more than 150 new hydrogen production projects, now exceeding 250 gigawatts of new power production (roughly ten times all renewable power added by China last year and three times the renewable power additions for the whole world). Public policy is helping. At least 35 countries across the globe have developed formal hydrogen strategies—including Canada, Chile, Germany, India, Japan, the Netherlands, Qatar, Saudi Arabia, and the United Kingdom—because they see clean hydrogen as both essential for addressing climate change and a huge opportunity for trade and commercial competitiveness.
Until recently, hydrogen was used chiefly to make ammonia and refined fuels. Most of that hydrogen has come from processes that use fossil fuels with no abatement measures, which add 500 million tons of carbon dioxide to the atmosphere each year, or about one percent of all global greenhouse gas emissions. In contrast, most of today’s enthusiasm and investment is going toward using hydrogen as a fuel itself or for making new clean fuels. And rather than rely on the old processes that pump carbon dioxide into the atmosphere, there is an intense focus on making “green” hydrogen, which instead uses clean electricity from solar, wind, hydro, or nuclear power to split water into its component parts: hydrogen and oxygen. The approach is simple—it is performed in chemistry classes worldwide—and it requires no combustion and has few moving parts. Investment in these technologies puts green hydrogen center stage for the future production of widely available clean fuels.
Five years ago, this excitement for green hydrogen would have surprised many energy and climate experts, who saw hydrogen as an unlikely player in the future energy mix. In earlier economies, hydrogen couldn’t compete as a fuel. It was simply too expensive, as were solar and wind power, and abundant alternatives were available, including coal, natural gas, and crude oil. Early attempts to make hydrogen a larger part of the economy focused on its use in automobiles, which would have required wholesale changes to fueling infrastructure and factory floors.
The need to address climate change is spurring interest in hydrogen, and new policy measures, along with remarkable technological progress, are making its production a practical reality. Over 137 countries have committed to reaching “net zero” by 2050, meaning they will reduce their greenhouse gas emissions to as close to zero as possible and offset whatever cannot be eliminated by planting trees or taking carbon out of the atmosphere by other means. Major corporations are making similar pledges. Over 320 companies have committed to reaching net zero by 2040. Behind these promises is simple climate math: to stabilize climate change at any level, all sectors everywhere, including electricity, transportation, food, and manufacturing, must effectively reach zero and stay there forever.
That inflexible arithmetic drives production of enormous amounts of green hydrogen to serve those goals. The International Energy Agency has estimated that global green hydrogen production must increase 400-fold by 2050 to make net-zero emissions possible. In addition to ambitious climate goals, advances in technology also enable the shift to green hydrogen. Ten years ago, green hydrogen was wildly more expensive than its dirtier cousins (especially “gray” hydrogen, which is made from natural gas or coal). Most notably, the dramatic decrease in the cost of generating wind and solar power has brought the possibility of scaling up green hydrogen production into the realm of the politically possible.
Green hydrogen’s promise is finally coming into focus. Ramping up its production and diversifying its use will create risks and challenges along the way. To realize the full potential of green hydrogen in the fight against climate change, countries must invest in infrastructure and set the right policies to mitigate the inevitable risks when a new energy market quickly goes commercial.
THE PROMISE
As a clean fuel, hydrogen is quite extraordinary. It burns hot: 2,100 degrees Celsius. That is hot enough to make cement, glass, and steel. It is light—the lightest in the universe—which helps maintain efficiency as a transportation fuel. When run through a fuel cell, it generates electricity on demand. It can combine with other compounds to make fertilizer, liquid fuels, and plastics. Most important for reducing the effects of climate change, these uses emit zero greenhouse gases directly, making hydrogen a destination fuel and feedstock in a net-zero-emissions economy. Burning hydrogen yields water, suitable for drinking or recycling into hydrogen. Plus, once isolated, hydrogen can serve as the main building block to produce other clean fuels, most important, ammonia—another dark horse in the decarbonization race because it emits no carbon when used, has high energy density, and is easily stored and shipped. Hydrogen is also the main building block for fertilizer and other important products, such as explosives and cleaning liquids. Because hydrogen and its derivative products can be stored in tanks and salt caverns indefinitely, it can meet surges in demand during seasonal power variations and stand ready at shipping terminals.
But the process to make pure hydrogen and turn it into a useful product requires energy, and that energy may not always be clean. Natural gas is used to produce gray hydrogen, but the process emits carbon dioxide, exacerbating the climate change problem. When that carbon dioxide byproduct is captured or stored underground, the resulting hydrogen is referred to as “blue” hydrogen, which can be very clean and low in carbon. Biomass, ranging from wood chips to trash, can be chemically changed into biohydrogen, with or without carbon capture. Both these processes can generate very low-carbon hydrogen but require feedstocks (coal, methane, or municipal wastes) that must be mined, stored, shipped, and then converted, with the byproduct carbon dioxide stored underground.
In contrast, the production of green hydrogen requires only three things: fresh water, electrolyzers to split water into its atomic elements, and low-carbon electricity to power the process. It can therefore be produced from low-cost renewable power—namely, solar, wind, and hydro—and other ultra-low carbon electricity, such as nuclear power. Any location with enough fresh water and clean electricity options can become a hydrogen energy superstar. One unlikely example is Chile, which appears to have achieved the lowest generation cost so far because it has superb solar, wind, and hydropower resources—some of the best on earth. Chile has launched ambitious plans for green hydrogen products to generate ten percent of its GDP by 2040. In July, the EU announced a multibillion-dollar investment in green hydrogen production in Namibia, which also has exceptional solar and wind resources. The hydrogen will be used to make ammonia, which will be shipped to Europe and used for energy and food production. It should also produce jobs and new wealth for Namibians.
At least 35 countries across the globe have developed formal hydrogen strategies.
Described as a sort of Swiss Army knife for climate change, hydrogen has potential applications in electricity generation, transportation, and agribusiness. But the most promising application for green hydrogen is heavy industry. Manufacturing of concrete, steel, and chemicals is a huge source of global emissions. These hard-to-decarbonize sectors can’t run on electricity easily or at all. Their range of potential alternative fuels is small, and almost all continue to emit greenhouse gases. For these sectors, hydrogen and its derivative products will be extremely attractive when venting greenhouse gases is no longer accepted or allowed. An example of what the future could look like is the HYBRIT—“hydrogen breakthrough ironmaking technology”—steel plant in Sweden, which has produced the first fossil-free steel using green hydrogen from hydro and nuclear power. HYBRIT is such a rip-roaring success that Sweden’s national steel company has announced that it is replacing all its blast furnaces with similar green-hydrogen-fueled systems.
The eventual price of green hydrogen may be the secret to its success. Most experts agree that between 2030 and 2040, green hydrogen will be produced in many major markets below $2 per kilogram. While this is still roughly 50 to 100 percent more than what gray hydrogen costs today, it is an acceptable cost for many industries and countries. Chile has already declared that it can make hydrogen below $2 per kilogram, and that may soon be true of western Saudi Arabia and northwest Australia, where mammoth projects are under development to produce green hydrogen and ammonia. Projects in the works in Canada, Colombia, the United Kingdom, and the United States also reflect the expectation that demand for clean hydrogen will grow and costs will eventually come way down.
THE DRAWBACKS
Like all other solutions that promise lower greenhouse gas emissions, green hydrogen faces substantial obstacles to quickly scaling up. The biggest is the lack of infrastructure. The United States has only about 1,000 miles of hydrogen pipelines, a relatively meager amount. (It has 100 times more natural gas pipeline miles, which cannot be readily reused for hydrogen.) There is also the problem of power transmission. Chokepoints in the electric grid limit the ability not only to add renewable power but also to bring it to urban and industrial centers, where the electricity-intensive electrolyzers must operate.
Because hydrogen is so light and so small, it’s very hard to ship and store. Hydrogen molecules are small and slippery and are commonly stored at super high pressures or super low temperatures, which adds energy and capital costs. Few ports can ship or receive hydrogen or ammonia, and virtually none have facilities to fuel ships, boats, trucks and dock engines with either fuel, even ports with large industrial demands. This lack of infrastructure to generate, move, and store hydrogen is common to most countries, developed and developing alike. Although some policies have made new infrastructure investments possible, current limits will create chokepoints for this decade and beyond.
Cost is another challenge. In many markets, green hydrogen is still much more expensive than gray or even blue hydrogen—typically four to eight times more expensive. Although some herald green hydrogen as lower cost than hydrogen made from natural gas (blue or gray), such predictions assume a physical scaling up of production that has not yet occurred. They also assume that renewable power generation will run at high capacity, producing electricity more than 75 percent of the time. But that level of uptime can be maintained in only a handful of places on earth—typically regions with abundant hydropower or a combination of abundant solar and wind, such as Chile, Namibia, and northwest Australia, generally far from global demand centers. Moreover, supply chain crunches and critical material shortages are driving up costs for both renewable power equipment and for electrolyzers.
Finally, scaling of hydrogen may present unexpected climate and environmental risks. One example is leakage, which is when hydrogen escapes into the air from production sites, use sites, or pipelines. A lot of leakage would extend the life of some greenhouse gases such as methane or nitrous oxides in the atmosphere, further warming the planet. If countries begin to rapidly scale up their production without properly regulating and monitoring it—which all countries fail to do today—that could lead to substantial hydrogen leakage. Although hydrogen and ammonia can be used safely, massively scaling up their use around the world would add millions of potential leak points without proper oversight and regulation. Similarly, spills and leaks of hydrogen-based fuels (such as ammonia) pose environmental challenges that must be managed, as with gasoline or crude oil spills and leaks.
NEW POWER PLAYERS
The geopolitical implications of a shift from fossil fuels to green hydrogen could prove profound. For one thing, it will create new fuel providers that will compete with current providers. Some petrostates have ample green and blue hydrogen resources, so they will be able to maintain some of their power and leverage, but many new countries are coming online and could disrupt the status quo. Many of these countries are in the global South, including Chile, Colombia, Indonesia, Morocco, Namibia, and Uruguay, and clean energy production could bring wealth to them as it has to petrostates in the past. Current consumers of fossil fuels and chemicals, such as India, have rolled out ambitious domestic green hydrogen production programs, first to make fertilizer and then to help decarbonize their heavy industry. Big players in the green hydrogen market will compete for market share with emerging blue hydrogen powerhouses, including Canada, Nigeria, and the United States. And they will compete for major buyers, such as China, Japan, South Korea, Singapore, and, of course, the EU. This fight to win buyers and capture markets is reflected in the recent blizzard of bilateral agreements—two nations agreeing to dedicated production and purchase of hydrogen and ammonia. Japan and Chile inked such a deal, as did the EU and Namibia, but they are not alone; over 80 bilateral agreements across dozens of nations support production and trade of hydrogen and its derivative products.
As the forces of technology innovation, geopolitics, the desire for economic growth, and diverse natural resources are converging, new policies are being developed that combine climate, innovation, and trade. This merging of policy is clearest in Japan. The country’s banks are financing the production of green hydrogen in Australia and Chile, which will deliver clean fuel for Japan to use in its ports, power plants, and industrial sites. In Japan, government incentives are encouraging clean power production, clean transportation, and clean manufacturing, thereby surmounting the direct consumer cost from clean hydrogen. Taking a holistic policy approach such as Japan’s helps overcome classic “chicken and egg” problems. In short, Japan is building chickens—dedicated hydrogen and clean fuel production around the world and a market to buy the products. This takes the risk out of green hydrogen production through underwriting, industrial policy, and infrastructure development. At the core of these deals are long-term agreements to take hydrogen at guaranteed (fixed) prices. Many other countries are doing the same, including Singapore, South Korea, and some EU members.
The United States has also entered the fray. The Infrastructure Investment and Jobs Act, passed by Congress in November 2021, committed $8 billion to construction and operation for four hydrogen hubs to produce, store, ship, and use hydrogen. Congress has also added billions of dollars for new renewable generation, transmission lines, and port infrastructure. But that was just the opening act. Congress then passed the Inflation Reduction Act in August 2022. Most notably, the law created a new class of tax credits, known as Title 45V, which provide tax breaks for clean hydrogen production. This new tax credit is indexed to the carbon intensity of different types of production, with the cleanest hydrogen production receiving $3 per kilogram, dramatically lowering the total cost for green hydrogen. The best solar, wind, hydro, and nuclear projects in the United States would receive this direct-pay incentive, allowing easier access to markets.
Green hydrogen faces substantial obstacles to quickly scaling up.
The European Green Deal, a blueprint of carrots and sticks by the European Commission to meet stricter climate goals, features grants, tariff relief, and subsidies for green hydrogen production, providing an estimated $500 billion in incentives. European interest in green hydrogen has grown after the invasion of Ukraine, with many governments eyeing green hydrogen as a medium-term alternative to Russian gas while remaining true to their climate goals. In many ways, this flood of government investment encourages private investment and resembles the kind of bilateral policies and deals seen in the early days of liquid natural gas production and shipping 20 years ago. Back then, governments made similar long-term commitments to encourage large private-capital investments in liquid natural gas infrastructure.
Given the government support and private-sector investment, it is easy to be optimistic about the trajectory of green hydrogen. Climate advocates can feel good that its falling production costs should make the world’s 2050 climate goals easier to achieve than they were just five years ago. Those who focus on energy security see a way to diversify fuel supplies and reduce the power of individual geopolitical actors. Organized labor sees jobs. Banks see returns. Those concerned with global equality see a chance to shrink the gap between the global North and the global South. Still, care and attention will be required as this new energy market grows. In theory, there’s no difference between theory and practice. In practice, there is. Although the journey to green hydrogen will be a bumpy ride, the optimism is warranted, and the hype is justified
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Agree.
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https://www.zerohedge.com/commodities/us-shale-warns-energy-stricken-europe-no-bailout-coming
Putin will use General Winter to conquer Europe without a shot fired.
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https://media.gab.com/cdn-cgi/image/width=1050,quality=100,fit=scale-down/system/media_attachments/files/116/087/278/original/ce6991ed3ba7a1a1.jpg
(https://media.gab.com/cdn-cgi/image/width=1050,quality=100,fit=scale-down/system/media_attachments/files/116/087/278/original/ce6991ed3ba7a1a1.jpg)
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https://www.zerohedge.com/commodities/us-shale-warns-energy-stricken-europe-no-bailout-coming
Putin will use General Winter to conquer Europe without a shot fired.
https://www.zerohedge.com/geopolitical/european-union-about-rupture
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https://www.zerohedge.com/commodities/us-shale-warns-energy-stricken-europe-no-bailout-coming
Putin will use General Winter to conquer Europe without a shot fired.
https://www.zerohedge.com/geopolitical/european-union-about-rupture
https://bayourenaissanceman.blogspot.com/2022/09/im-glad-i-dont-live-in-germany-right-now.html
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https://www.zerohedge.com/commodities/us-shale-warns-energy-stricken-europe-no-bailout-coming
Putin will use General Winter to conquer Europe without a shot fired.
https://www.zerohedge.com/geopolitical/european-union-about-rupture
https://media.gab.com/system/media_attachments/files/116/557/047/original/9b204743d0ec4e06.jpg
(https://media.gab.com/system/media_attachments/files/116/557/047/original/9b204743d0ec4e06.jpg)
https://bayourenaissanceman.blogspot.com/2022/09/im-glad-i-dont-live-in-germany-right-now.html
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https://www.zerohedge.com/commodities/iea-head-warns-continental-scramble-wild-west-scenario-could-unravel-europe
Narrator voice: Europe is fcuked.
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https://www.zerohedge.com/commodities/iea-head-warns-continental-scramble-wild-west-scenario-could-unravel-europe
Narrator voice: Europe is fcuked.
https://www.thegatewaypundit.com/2022/09/russias-nord-stream-2-pipeline-germany-loses-pressure-overnight-300-7-bars-cause-unknown/
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https://ace.mu.nu/archives/401129.php
https://twitter.com/i/status/1490792461979078662
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Whoa , , ,
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https://ace.mu.nu/archives/401129.php
https://twitter.com/i/status/1490792461979078662
https://media.gab.com/cdn-cgi/image/width=1050,quality=100,fit=scale-down/system/media_attachments/files/116/753/298/original/aa9ad5ad8b55a661.jpg
(https://media.gab.com/cdn-cgi/image/width=1050,quality=100,fit=scale-down/system/media_attachments/files/116/753/298/original/aa9ad5ad8b55a661.jpg)
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https://ace.mu.nu/archives/401129.php
https://twitter.com/i/status/1490792461979078662
https://media.gab.com/cdn-cgi/image/width=1050,quality=100,fit=scale-down/system/media_attachments/files/116/753/298/original/aa9ad5ad8b55a661.jpg
(https://media.gab.com/cdn-cgi/image/width=1050,quality=100,fit=scale-down/system/media_attachments/files/116/753/298/original/aa9ad5ad8b55a661.jpg)
https://cphpost.dk/?p=138990
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don't forget the "greens" as motivated
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don't forget the "greens" as motivated
There might be some crazy greens with the motivation, but the ability ?
Where has the USS Kearsarge been recently?
"Kearsarge is capable of amphibious assault, advance force and special purpose operations, as well as non-combatant evacuation and other humanitarian missions. Since her commissioning, she has performed these missions all over the world"
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https://ace.mu.nu/archives/401129.php
https://twitter.com/i/status/1490792461979078662
https://media.gab.com/cdn-cgi/image/width=1050,quality=100,fit=scale-down/system/media_attachments/files/116/753/298/original/aa9ad5ad8b55a661.jpg
(https://media.gab.com/cdn-cgi/image/width=1050,quality=100,fit=scale-down/system/media_attachments/files/116/753/298/original/aa9ad5ad8b55a661.jpg)
https://cphpost.dk/?p=138990
Russia, Europe, and the Golden Goose Named Nord Stream
> Matt Bracken / Sep 27, 2022
Today, September 27, "somebody" blew up both Nord Stream pipelines by underwater sabotage, that is, with a submarine/mini submarine/frogman demolition raid. Who? "Somebody." But only Americans watching brain-dead up-is-down 2+2=5 propaganda 24/7 will believe Putin ordered it. Why?
Because Russia controls the natural gas input to the Nord Stream pipelines with valves. They can turn the pressure on and off at will. As long as the pipelines are undamaged, Russia holds more face cards and has more options.
What happened today with the submarine/mini-sub/frogman pipeline demo attack, was that Europe lost ANY chance to reconsider its sanctions against Russia in return for more natural gas.
Now, who, pray tell, might want to forestall ANY opportunity for Europeans to reconsider their sanctions against Russia, as winter sets in, people freeze, and factories shut down, leading to mass unemployment, the worst economic depression in a century, and possibly mass riots that could overturn governments?
Think hard. Ponder. Did Russia originally cut off Europe’s gas? NO. Europe put sanctions on Russia over Ukraine and said, “We won’t buy your nasty damn Russian gas anymore.” But, the option to reconsider sanctions, and buy Russian gas again, was always open. Russia controlled the valves, and was always willing to honor their multi-year contracts and keep selling natural gas to Europe. {Buying with Rubles, etc, as many countries are.]
Now, after the Nord Stream pipelines were blown up today, the option for Europeans to reconsider their anti-Russian sanctions is closed, at least this winter. Only America can send them replacement liquid natural gas, and we can’t send half of what they need by LNG tanker. Way less than half.
So Europe is now SCREWED. Trapped like a cave diver who is a thousand feet from the cave exit, looking at his last air bottle's gauge, as the needle heads to zero. He's not going to make it, and he knows it.
Here is another analogy. A guy you don’t like much owns a golden goose. Every day it lays a golden egg, and you buy the gold egg on favorable terms. Every day, long term contract. You do massive jewelry business, whatever. The deal works for both of you.
Now, you get into a fight with the owner of the goose, mainly on behalf of one of your much richer friends who hates the goose guy even MORE than you hate him. You are pressured into not buying any of they guy’s golden eggs. Your rich friend assures you that soon the owner of the golden goose will come begging you to buy his golden eggs again, because his income has been cut off.
But it doesn’t work out the way your rich friend said. Turns out, Mr. Golden Goose can sell his golden eggs to other people. He’s not going broke. On the other hand, you, the big league jeweler, you ARE going broke without the gold. You are looking at closing your chain of jewelry outlets and laying everybody off. Bankrupt.
Now, is it logical, do you believe, that under any circumstance, the owner of the golden goose is going to break the neck of his golden goose and kill it, out of a fit of pique, BECAUSE YOU REFUSED TO BUY HIS GOLDEN EGGS!?
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https://ace.mu.nu/archives/401129.php
https://twitter.com/i/status/1490792461979078662
https://media.gab.com/cdn-cgi/image/width=1050,quality=100,fit=scale-down/system/media_attachments/files/116/753/298/original/aa9ad5ad8b55a661.jpg
(https://media.gab.com/cdn-cgi/image/width=1050,quality=100,fit=scale-down/system/media_attachments/files/116/753/298/original/aa9ad5ad8b55a661.jpg)
https://cphpost.dk/?p=138990
Russia, Europe, and the Golden Goose Named Nord Stream
> Matt Bracken / Sep 27, 2022
Today, September 27, "somebody" blew up both Nord Stream pipelines by underwater sabotage, that is, with a submarine/mini submarine/frogman demolition raid. Who? "Somebody." But only Americans watching brain-dead up-is-down 2+2=5 propaganda 24/7 will believe Putin ordered it. Why?
Because Russia controls the natural gas input to the Nord Stream pipelines with valves. They can turn the pressure on and off at will. As long as the pipelines are undamaged, Russia holds more face cards and has more options.
What happened today with the submarine/mini-sub/frogman pipeline demo attack, was that Europe lost ANY chance to reconsider its sanctions against Russia in return for more natural gas.
Now, who, pray tell, might want to forestall ANY opportunity for Europeans to reconsider their sanctions against Russia, as winter sets in, people freeze, and factories shut down, leading to mass unemployment, the worst economic depression in a century, and possibly mass riots that could overturn governments?
Think hard. Ponder. Did Russia originally cut off Europe’s gas? NO. Europe put sanctions on Russia over Ukraine and said, “We won’t buy your nasty damn Russian gas anymore.” But, the option to reconsider sanctions, and buy Russian gas again, was always open. Russia controlled the valves, and was always willing to honor their multi-year contracts and keep selling natural gas to Europe. {Buying with Rubles, etc, as many countries are.]
Now, after the Nord Stream pipelines were blown up today, the option for Europeans to reconsider their anti-Russian sanctions is closed, at least this winter. Only America can send them replacement liquid natural gas, and we can’t send half of what they need by LNG tanker. Way less than half.
So Europe is now SCREWED. Trapped like a cave diver who is a thousand feet from the cave exit, looking at his last air bottle's gauge, as the needle heads to zero. He's not going to make it, and he knows it.
Here is another analogy. A guy you don’t like much owns a golden goose. Every day it lays a golden egg, and you buy the gold egg on favorable terms. Every day, long term contract. You do massive jewelry business, whatever. The deal works for both of you.
Now, you get into a fight with the owner of the goose, mainly on behalf of one of your much richer friends who hates the goose guy even MORE than you hate him. You are pressured into not buying any of they guy’s golden eggs. Your rich friend assures you that soon the owner of the golden goose will come begging you to buy his golden eggs again, because his income has been cut off.
But it doesn’t work out the way your rich friend said. Turns out, Mr. Golden Goose can sell his golden eggs to other people. He’s not going broke. On the other hand, you, the big league jeweler, you ARE going broke without the gold. You are looking at closing your chain of jewelry outlets and laying everybody off. Bankrupt.
Now, is it logical, do you believe, that under any circumstance, the owner of the golden goose is going to break the neck of his golden goose and kill it, out of a fit of pique, BECAUSE YOU REFUSED TO BUY HIS GOLDEN EGGS!?
https://www.zerohedge.com/commodities/damage-nord-stream-pipelines-unprecedented-may-have-been-sabotaged
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https://uploads.disquscdn.com/images/e0f2e9d2fb6536037e7d0d4476206688f6d064ade9c4539071a9e161a034253d.jpg?w=800&h=396
(https://uploads.disquscdn.com/images/e0f2e9d2fb6536037e7d0d4476206688f6d064ade9c4539071a9e161a034253d.jpg?w=800&h=396)
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https://web.archive.org/web/20220331032314/https://www.reuters.com/business/energy/if-russia-invades-ukraine-there-will-be-no-nord-stream-2-biden-says-2022-02-07/and
https://www.youtube.com/watch?v=xxXr7Oe_toA
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"There might be some crazy greens with the motivation, but the ability ?"
I heard Greta T knows people ......
How dare you !
:wink:
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https://ace.mu.nu/archives/401129.php
https://twitter.com/i/status/1490792461979078662
https://media.gab.com/cdn-cgi/image/width=1050,quality=100,fit=scale-down/system/media_attachments/files/116/753/298/original/aa9ad5ad8b55a661.jpg
(https://media.gab.com/cdn-cgi/image/width=1050,quality=100,fit=scale-down/system/media_attachments/files/116/753/298/original/aa9ad5ad8b55a661.jpg)
https://cphpost.dk/?p=138990
Russia, Europe, and the Golden Goose Named Nord Stream
> Matt Bracken / Sep 27, 2022
Today, September 27, "somebody" blew up both Nord Stream pipelines by underwater sabotage, that is, with a submarine/mini submarine/frogman demolition raid. Who? "Somebody." But only Americans watching brain-dead up-is-down 2+2=5 propaganda 24/7 will believe Putin ordered it. Why?
Because Russia controls the natural gas input to the Nord Stream pipelines with valves. They can turn the pressure on and off at will. As long as the pipelines are undamaged, Russia holds more face cards and has more options.
What happened today with the submarine/mini-sub/frogman pipeline demo attack, was that Europe lost ANY chance to reconsider its sanctions against Russia in return for more natural gas.
Now, who, pray tell, might want to forestall ANY opportunity for Europeans to reconsider their sanctions against Russia, as winter sets in, people freeze, and factories shut down, leading to mass unemployment, the worst economic depression in a century, and possibly mass riots that could overturn governments?
Think hard. Ponder. Did Russia originally cut off Europe’s gas? NO. Europe put sanctions on Russia over Ukraine and said, “We won’t buy your nasty damn Russian gas anymore.” But, the option to reconsider sanctions, and buy Russian gas again, was always open. Russia controlled the valves, and was always willing to honor their multi-year contracts and keep selling natural gas to Europe. {Buying with Rubles, etc, as many countries are.]
Now, after the Nord Stream pipelines were blown up today, the option for Europeans to reconsider their anti-Russian sanctions is closed, at least this winter. Only America can send them replacement liquid natural gas, and we can’t send half of what they need by LNG tanker. Way less than half.
So Europe is now SCREWED. Trapped like a cave diver who is a thousand feet from the cave exit, looking at his last air bottle's gauge, as the needle heads to zero. He's not going to make it, and he knows it.
Here is another analogy. A guy you don’t like much owns a golden goose. Every day it lays a golden egg, and you buy the gold egg on favorable terms. Every day, long term contract. You do massive jewelry business, whatever. The deal works for both of you.
Now, you get into a fight with the owner of the goose, mainly on behalf of one of your much richer friends who hates the goose guy even MORE than you hate him. You are pressured into not buying any of they guy’s golden eggs. Your rich friend assures you that soon the owner of the golden goose will come begging you to buy his golden eggs again, because his income has been cut off.
But it doesn’t work out the way your rich friend said. Turns out, Mr. Golden Goose can sell his golden eggs to other people. He’s not going broke. On the other hand, you, the big league jeweler, you ARE going broke without the gold. You are looking at closing your chain of jewelry outlets and laying everybody off. Bankrupt.
Now, is it logical, do you believe, that under any circumstance, the owner of the golden goose is going to break the neck of his golden goose and kill it, out of a fit of pique, BECAUSE YOU REFUSED TO BUY HIS GOLDEN EGGS!?
https://www.zerohedge.com/commodities/damage-nord-stream-pipelines-unprecedented-may-have-been-sabotaged
https://www.zerohedge.com/geopolitical/15-things-we-know-about-mysterious-explosions-severely-damaged-nord-stream-1-and-2
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https://seapowermagazine.org/baltops-22-a-perfect-opportunity-for-research-and-resting-new-technology/
https://media.gab.com/cdn-cgi/image/width=1050,quality=100,fit=scale-down/system/media_attachments/files/116/795/933/original/940015fdec3a2043.jpg
(https://media.gab.com/cdn-cgi/image/width=1050,quality=100,fit=scale-down/system/media_attachments/files/116/795/933/original/940015fdec3a2043.jpg)
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https://media.gab.com/system/media_attachments/files/116/815/784/original/4244d1e3163faf64.png
(https://media.gab.com/system/media_attachments/files/116/815/784/original/4244d1e3163faf64.png)
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https://www.moonofalabama.org/2022/09/whodunnit-facts-related-to-the-sabotage-attack-on-the-nord-stream-pipelines.html
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https://www.heritage.org/global-politics/commentary/russias-attack-nord-stream-pipelines-means-putin-has-truly-weaponized
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so heritage knows for sure Russia sabotaged their own pipeline when they simply could turn it off?
I don't trust ex cia political operative Brennan
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so heritage knows for sure Russia sabotaged their own pipeline when they simply could turn it off?
I don't trust ex cia political operative Brennan
Exactly!
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https://summit.news/2022/09/29/no-evidence-us-involved-in-nord-stream-pipeline-attack-because-pentagon-says-so/
Case closed!
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https://vz-ru.translate.goog/society/2021/4/14/1094528.html?_x_tr_sl=auto&_x_tr_tl=en&_x_tr_hl=en-US&_x_tr_pto=wapp
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https://bayourenaissanceman.blogspot.com/2022/09/the-death-of-germany-and-europe.html
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https://www.zerohedge.com/geopolitical/another-nord-stream-leak-detected-swedish-coastguard-says
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so heritage knows for sure Russia sabotaged their own pipeline when they simply could turn it off?
I don't trust ex cia political operative Brennan
Exactly!
https://media.gab.com/cdn-cgi/image/width=1050,quality=100,fit=scale-down/system/media_attachments/files/116/881/661/original/85be769a2381807d.jpg
(https://media.gab.com/cdn-cgi/image/width=1050,quality=100,fit=scale-down/system/media_attachments/files/116/881/661/original/85be769a2381807d.jpg)
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https://twitter.com/Chrissy61351005/status/1575511363643969536
Probably correctly.
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What is the name of the new gas pipeline from Norway to __________ (Denmark?)
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What is the name of the new gas pipeline from Norway to __________ (Denmark?)
Baltic Pipe, Norway to Poland:
https://www.euractiv.com/section/energy-environment/news/baltic-pipe-gas-pipeline-opens-connects-norway-and-poland/
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https://www.zerohedge.com/geopolitical/another-nord-stream-leak-detected-swedish-coastguard-says
This is a good article for facts. The pipeline is inches thick of steel. They don't break easily.
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so heritage knows for sure Russia sabotaged their own pipeline when they simply could turn it off?
I don't trust ex cia political operative Brennan
Brennan is a contrary indicator but he is irrelevant. Strange that Heritage posted that, without evidence.
----------------------
Strangest of all is Biden saying (implying?) the US would do it. I doubt we did but that provides cover for whoever did.
One would suspect the anti-gas and oil 'environmentalists'. Greta (and her people) did it? BUT methane (unburnt natural gas) traps 100 times more heat than CO2:
https://climate.mit.edu/ask-mit/why-do-we-compare-methane-carbon-dioxide-over-100-year-timeframe-are-we-underrating
Environmentalists know their science and would do nothing to hurt the environment. Oh, wait...
No one pro-Europe would do this. Isn't the US pro-Europe? Biden couldn't face his friends at the conferences ever again.
Makes no sense that Russia did it, Putin-Russia that is. Gas through the pipeline is their cash register and funds the war effort. Other elements in Russia, even within their military, might want to sabotage Putin's power. If so, western intelligence might know and not tell.
Now it seems the subject got dropped unsolved. Our President is busy looking for Jackie. Another case of a deplorable lack of curiosity!
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What is the name of the new gas pipeline from Norway to __________ (Denmark?)
Baltic Pipe, Norway to Poland:
https://www.euractiv.com/section/energy-environment/news/baltic-pipe-gas-pipeline-opens-connects-norway-and-poland/
---------------------
https://www.zerohedge.com/geopolitical/another-nord-stream-leak-detected-swedish-coastguard-says
This is a good article for facts. The pipeline is inches thick of steel. They don't break easily.
---------------------
so heritage knows for sure Russia sabotaged their own pipeline when they simply could turn it off?
I don't trust ex cia political operative Brennan
Brennan is a contrary indicator but he is irrelevant. Strange that Heritage posted that, without evidence.
----------------------
Strangest of all is Biden saying (implying?) the US would do it. I doubt we did but that provides cover for whoever did.
One would suspect the anti-gas and oil 'environmentalists'. Greta (and her people) did it? BUT methane (unburnt natural gas) traps 100 times more heat than CO2:
https://climate.mit.edu/ask-mit/why-do-we-compare-methane-carbon-dioxide-over-100-year-timeframe-are-we-underrating
Environmentalists know their science and would do nothing to hurt the environment. Oh, wait...
No one pro-Europe would do this. Isn't the US pro-Europe? Biden couldn't face his friends at the conferences ever again.
Makes no sense that Russia did it, Putin-Russia that is. Gas through the pipeline is their cash register and funds the war effort. Other elements in Russia, even within their military, might want to sabotage Putin's power. If so, western intelligence might know and not tell.
Now it seems the subject got dropped unsolved. Our President is busy looking for Jackie. Another case of a deplorable lack of curiosity!
This takes Russia's tool of tweaking europe into compliance off the table and bring in revenue off the table.
It prevents Germany from cutting a deal with Russia as General Winter kicks europe's ass.
Means, motive and opportunity put the US at the top of the suspect list.
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Self-incrimination by Biden and other members of US Regime
Michael Yon
Sep 29
29 September 2022
Dublin, Ireland
Mind dump, sans edit
All those statements by Biden and other USG are epic self-incrimination about intent to destroy Nord Stream 2. And now but NS1 and NS2 have been attacked. The Beast said clearly in clear words on video at least four times that the Beast would stop NS2.
Those pipeline attacks are likely the most serious single attacks in human history. Though few people seem to get it. Yet.
The Beast is now using this as casus belli to attack Russia.
Now watch Yamal, and Norwegian flows, etc.
This meme keeps hitting my box: More blood-hate born and fanned.
These attacks will contribute to massive famines that nobody reading this in 2022 has ever seen or read about. Nobody in human history will have witnessed something on such scale.
Meanwhile, Germany is clear-cutting green forests for burning fuel this winter. Vast swaths of forests are being felled. I saw this while crisscrossing Germany. Making matters worse, these are green, living trees. Gone. And when they go up German smokestacks, these trees will burn inefficiently with terrible amounts of pollution. Watch as the German and European air quality plummets into the Red like China or India.
Fertilizers, other chemicals — gone. Corn gone. Chickens gone.
Where will the deer and squirrels and birds live? They will be killed and eaten.
The Greens, Globalists, Progressives — are enemies of man, beast, and environment.
Please keep me in the field. The tipping point is now: https://www.givesendgo.com/keeputhefight
The blood hate thickens. This meme has gone viral
(https://substackcdn.com/image/fetch/f_auto,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2Fcd1a01c5-63ca-4a81-bc6f-3447c0f1f419_552x840.jpeg?utm_source=substack&utm_medium=email)
https://substackcdn.com/image/fetch/f_auto,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2Fcd1a01c5-63ca-4a81-bc6f-3447c0f1f419_552x840.jpeg?utm_source=substack&utm_medium=email
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".Means, motive and opportunity put the US at the top of the suspect list."
which would easily explain Brennan running around pointing finger to Russia
I can't wait till his clearance gets yanked and he get off the stage by one of those curved canes
https://tvtropes.org/pmwiki/pmwiki.php/Main/VaudevilleHook
as a comedian he sucks though he tries to humor us with cynical lying.
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Why is an Israeli flag on the sub in MY's meme?
Seems like a dirty shot , , ,
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Why is an Israeli flag on the sub in MY's meme?
Seems like a dirty shot , , ,
It’s a German meme.
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Ah.
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(https://s.yimg.com/ny/api/res/1.2/6BBYQSAqThpq7b_58Ij9ng--/YXBwaWQ9aGlnaGxhbmRlcjt3PTcwNTtoPTcwNTtjZj13ZWJw/https://s.yimg.com/uu/api/res/1.2/G8kfDMKvVR32zPuNxhHJPg--~B/aD00NTA7dz00NTA7YXBwaWQ9eXRhY2h5b24-/https://media.zenfs.com/en/oilprice.com/f96a5394440752769c8a84a35d004689)
https://www.yahoo.com/video/why-europe-won-t-exploit-230000776.html#:~:text=Europe%20has%20more%20recoverable%20shale,This%20isn't%20North%20America
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Matt Bracken:
The USN did it, 100%.
That part of the Baltic is practically like the Chesapeake Bay. It’s a transparent NATO aquarium. USN warships and helos spent all summer conducting underwater UUV / ROV drone “mine detection and demolition” drills. You have seen all the news stories.
If anybody else tried to explode 4 simultaneous pipeline bombs, in pairs, 20 KM apart, (NS1 and NS2), NATO and the USN would know ALL about it.
A medium-size fish cannot swim in and out of the Baltic (50' controlling depth) without being recorded on audio, video, hydro/pressure etc.
Russia has bare transit rights [during peacetime] from Kaliningrad and St. Pete, but that is it. Every Russian ship going in and out of the Baltic is virtually escorted front and rear. The Western Baltic is a small lake surrounded by NATO nations, plus NATO-cooperating Sweden and Finland.
The USN did it. Period.
I take no joy in saying that, as a long-ago frogman who locked in and out of submerged nuclear submarines, rode in mini-subs (SDVS), trained with every conceivable kind of underwater demolition, (too long to list), and dived with air bottles, mixed gas, and pure oxygen (for no bubbles). IOW, I know whereof I speak.
To believe otherwise than the USN did this is like believing the Russians snuck up the Thames River in a mini mystery sub to blow up 4 key British infrastructure sites, at the same time, and got away undetected.
(I will allow that the USN may have “sheep-dipped” some Poles in on the operation, to keep them quiet forever, but IMHO, it was a USN operation.)
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https://thelawdogfiles.com/2022/09/nordstream.html?fbclid=IwAR1a8ECwjgwkVbdU5H2kgYwFSeQlkSkQoH0D_1_3a_rPLci92dSl3IIT2Wc
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The Nord Stream Leaks Set a Precedent for Russian Attacks on Europe's Energy Infrastructure
7 MIN READSep 29, 2022 | 21:48 GMT
Russia could further undermine Europe's energy security long after it cuts off gas supplies, if Moscow begins to more aggressively target the continent's maritime oil and gas industry. On Sept. 26, the Norwegian Petroleum Safety Administration warned of potential ''deliberate attacks'' after energy companies reported multiple cases of unidentified drones flying near offshore oil and gas installations. Just a few hours later, officials in Denmark warned they had found a gas leak along a section of the Nord Stream 2 pipeline off the coast of the Danish island of Bornholm. The following day, the Swedish Maritime Administration announced it also detected two gas leaks on the Nord Stream 1 pipeline in a nearby area. Russia is widely believed to be behind the recent attacks on the Nord Stream pipeline systems, which are both operated by the Russian gas giant Gazprom. But while the Kremlin has not yet shown an intent to target foriegn-owned infrastructure, the gas leaks nonetheless set a dangerous precedent by showing that Russia is capable of attacking oil and gas infrastructure in its near periphery.
On Sept. 28, Norwegian Prime Minister Jonas Gahr Store said Norwegian military forces were being deployed to help protect offshore installations. With Russia no longer shipping large volumes of natural gas to Europe, Norway is expected to supply about a quarter of the European Union's natural gas this year.
Following a meeting with NATO Secretary-General Jens Stoltenberg, Danish Defense Minister Morten Bodkov warned that ''Russia has a significant military presence in the Baltic Sea region and we expect them to continue their saber-rattling.''
Speaking on behalf of EU member states, EU foreign policy chief Josep Borrell said on Sept. 28 that ''any deliberate disruption of European energy infrastructure is utterly unacceptable and will be met with a robust and united response.''
The U.S. CIA had reportedly warned the German government of possible attacks on Baltic Sea pipelines prior to the recent gas leaks on the Nord Stream pipelines.
A number of different factors — including the imposition of new sanctions — could drive Russia to adopt a more aggressive strategy to undermine Europe's energy security. In response to Western sanctions pressure, Iran has pursued an aggressive strategy of roiling global energy markets by covertly targeting regional oil and gas infrastructure. Russia could pursue a similarly aggressive strategy, as it shares many of the strategic drivers that have pushed Iran to adopt this approach — namely, the plausible deniability that covert attacks bring, a desire to impose a cost on rivals, interest in driving up energy prices in the short term to increase revenue, and using attacks as a way to gain leverage in negotiations. With its natural gas exports to Europe now nearing zero, Russia also appears to be exhausting its ''gas weapon,'' leaving attacks (or the threat of attacks) on oil and gas infrastructure as the primary way for the Kremlin to apply more pressure on European energy security, particularly for natural gas. In addition, the Russian government may assess that further provocative actions will have a negligible impact on its relationship with the European Union because it has already sunk to its lowest level. To this end, while Iran's attacks against tankers and Saudi oil and gas infrastructure in 2019 resulted in some additional sanctions on Tehran, the Western response was not decisive. This may lead Russia to assess the blowback risk in terms of military escalation and/or new sanctions is low because Western sanctions are already high and NATO countries have already demonstrated that they are seeking to avoid a NATO-Russia conflict. Finally, the Kremlin may even assess that occasional attacks against Europe's energy sector won't close the door to possible future peace negotiations with Ukraine to exit the war.
Should it adopt a more aggressive strategy against Europe's energy sector, Russia could physically attack more oil and gas infrastructure in the Baltic Sea, as well as potentially the Black Sea and North Sea. Russia would likely avoid any actions that could be construed as a physical attack on a NATO member's sovereign territory to avoid triggering a broader NATO-Russia conflict. But this does not necessarily extend to offshore oil and gas infrastructure (and other offshore critical infrastructure, such as submarine communications cables) outside the 12 nautical mile extent from the coast defined as territorial waters. Notably, the perpetrator behind the recent Nord Stream 1 and 2 gas leaks appeared to be extremely precise in terms of where it attacked the pipeline systems. The two attacks on Nord Stream 1 occurred in Denmark's exclusive economic zone but just before the pipeline entered Danish territorial waters, while Nord Stream 2 does not go through Denmark's territorial waters at all.
There is no indication that the drones the Norwegian authorities warned about were Russian. There have also not been any reports of Russian operations beyond the Baltic Sea, such as in the North Sea, which would be far more operationally difficult due to the greater geographic distance from Russia and the fact that it'd entail operating in deeper waters. Most critical oil and gas infrastructure in the North Sea also lies outside the territorial waters of the United Kingdom, Norway and the Netherlands.
The Nord Stream incidents occurred the same day that Poland and Norway were inaugurating the Baltic Pipe pipeline system, which carries natural gas from Norway to Poland, traverses through the Baltic Sea and goes through some international waters beyond the 12 nautical mile limit. Due to its proximity to Russia in the Baltic Sea and Poland's very pro-Ukrainian stance, the Baltic Pipe may be the piece of infrastructure that Russia is most likely to attack if it begins more aggressively targeting Europe's energy sector.
Beyond the Baltic, Black and potentially North Seas, Russia's ability to target offshore oil and gas infrastructure is limited. It could still target Europe's energy security through attacks against LNG tankers and other vessels, or LNG terminals (such as regasification lines going back to the mainland). But such attacks would carry a greater risk of triggering a greater military conflict, as LNG terminals are typically in national territorial waters. Any attacks on LNG vessels would also raise the possibility of casualties. While Russia has not demonstrated such a risk appetite outside of Ukraine, this could change amid further battlefield setbacks in Ukraine.
Beyond physical attacks, Russia's cyber capabilities — including its prolific use of data wipers that can paralyze computer systems by deleting data on hard drives — could also cause significant damage to Europe's energy sector. While it could seek to physically disrupt the European gas market with cyberattacks targeting pipeline operators and industrial control systems operating the pipelines, such acts carry a higher risk of escalation if they cause explosions or loss of life. Attacks on less sensitive aspects of the oil and gas industry (such as information technology systems instead of operational technology systems) are less likely to trigger a greater conflict with the West, but can still create social unrest and cause major financial market swings. Cyberattacks can also lead to occasional infrastructure shutdowns, as evidenced by the 2021 ransomware attack on the U.S. Colonial Pipeline company, which took its pipeline in the southeastern part of the United States offline for a week. Finally, Russia could leverage its well-known links with cyber criminals, hacktivists and other cyber threat actors to conduct attacks on its behalf. Russia's recent military mobilization campaign could even potentially bring in new cyber recruits to whom Moscow could offer roles to carry out the same types of cyberattacks they were previously doing as criminals instead of being deployed on Ukraine's front lines.
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https://www.zerohedge.com/commodities/shocking-letter-reveals-uk-blackout-fear-natgas-supplies-could-be-cut-emergency
Narrator voice: It was too late.
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https://media.gab.com/cdn-cgi/image/width=1050,quality=100,fit=scale-down/system/media_attachments/files/117/150/078/original/81c5a84258ef4f01.jpg
(https://media.gab.com/cdn-cgi/image/width=1050,quality=100,fit=scale-down/system/media_attachments/files/117/150/078/original/81c5a84258ef4f01.jpg)
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https://thelawdogfiles.com/2022/09/nordstream.html?fbclid=IwAR1a8ECwjgwkVbdU5H2kgYwFSeQlkSkQoH0D_1_3a_rPLci92dSl3IIT2Wc
So, where are the pictures of the NS pipes? I did a search and all I am getting is stories from a week ago.
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silence about it
like leaker of the abortion decision
nada
almost like we are not supposed to know the truth....
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Is this what we want?
Does anyone know clean natural gas is cleaner?
Europe has shale. But not fracking.
https://www.reuters.com/business/energy/shocked-by-gas-bills-thrifty-dutch-stockpile-coal-wood-winter-2022-09-30/
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Democrats Blocked Trump From Filling Reserve at $24 Per Barrel
https://www.thegatewaypundit.com/2022/09/biden-pay-80-per-barrel-fill-strategic-oil-reserve-two-years-democrats-blocked-trump-filling-reserve-24-per-barrel/
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https://www.powerlineblog.com/archives/2022/10/exploding-electric-bicycles.php
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:-o
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https://www.powerlineblog.com/archives/2022/10/exploding-electric-bicycles.php
I remember some military sci-fi books where grenades were electrical based explosives. Now we have them mounted on two wheels!
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https://ace.mu.nu/archives/401255.php
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https://ace.mu.nu/archives/401255.php
Yes. Tired of losing.
Liberals (rightfully) made a big deal of the Khashoggi murder, one of their own. But jumping from that to condemning everything Saudi and siding with Iran, world's number one state sponsor of terror, is biting the world in the ass right now.
Let's see, we cancelled US gas and oil, lost Russia's, and Venezuela, cancelled a pipeline from Canada, turned on Saudi and OPEC, and now the northern hemisphere settles in for winter.
F'ing idiots.
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https://ace.mu.nu/archives/401255.php
https://twitter.com/ShellenbergerMD/status/1577740741660401664
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https://ace.mu.nu/archives/401255.php
https://twitter.com/ShellenbergerMD/status/1577740741660401664
https://www.zerohedge.com/markets/opecs-action-testimony-staggering-us-geopolitical-and-geoeconomic-error
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https://www.foxbusiness.com/economy/us-emergency-oil-supply-shrinks-40-year-low-biden-keeps-tapping-reserve?fbclid=IwAR0dfOUkRdwmv3dBGH04tJ9s6o3ncXgfTqdJ2v9XI7EXRAu3_S7Lkk2OjSA
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https://gatesofvienna.net/2022/10/the-belated-implementation-of-the-morgenthau-plan/
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https://twitter.com/ShellenbergerMD/status/1577740741660401664
Michael Shellenberger
@ShellenbergerMD
Biden thought it would be a political win for OPEC to increase production, so the US wouldn’t have to, thereby avoiding the wrath of green elites in his party. Instead, he’s undermined America’s standing in the world, helped Putin, and worsened inflation.
--------------------------------
My list of favorite (former?) Democrats is expanding.
Biden (also) thought he was so virtuous, canceling everything Saudi after the Khashoggi murder. Good for him but he shouldn't have canceled domestic gas and oil at the same time as telling the Saudis to go [ ] themselves.
This isn't just about aging Joe being a dimwit. These are the policies of the cabal behind him, and they are having horrible results for the American people and for the world.
Forecast is cold winter without food.
Janet Yellen says we need growth and resilience but everyone can see we are losing badly on both counts.
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"This isn't just about aging Joe being a dimwit. These are the policies of the cabal behind him, and they are having horrible results for the American people and for the world"
THIS!
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"This isn't just about aging Joe being a dimwit. These are the policies of the cabal behind him, and they are having horrible results for the American people and for the world"
THIS!
Yes!
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https://www.zerohedge.com/energy/uk-national-grid-warns-3-hour-rolling-blackouts-winter
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India benefitting from cheap oil, 7 % GDP expected this year. In contrast, germany has shot themselves in the foot, without gas their economy collapses and with it goes the Euro.
(https://pbs.twimg.com/media/Fenzk9WXEAEYE01?format=jpg&name=900x900)
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India benefitting from cheap oil, 7 % GDP expected this year. In contrast, germany has shot themselves in the foot, without gas their economy collapses and with it goes the Euro.
(https://pbs.twimg.com/media/Fenzk9WXEAEYE01?format=jpg&name=900x900)
Exactly!
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https://gatesofvienna.net/2022/10/the-hard-land-of-the-winter/
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https://english.almayadeen.net/articles/analysis/the-curious-silence-surrounding-the-baltic-gas-bubbles
A very astute analysis.
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https://english.almayadeen.net/articles/analysis/the-curious-silence-surrounding-the-baltic-gas-bubbles
A very astute analysis.
I second the question, why the silence of the bubbles?
Europe wouldn't be of one mind on that, if one of them did it and others are going to freeze.
From another thread:
Re: PanFa War; Supply Chain issues
« on: October 10, 2022, 10:06:12 AM »
[G M] "It prevents Germany from cutting a side deal with Russia, after Germans get tired of freezing this winter."
[Crafty] This makes sense to me. Indeed, enabling Germany to backstab its East Europe allies was precisely the point of the NSs IMHO.
So, qui bono?
America? Poland? Norway?
Given Biden's statement in 2/21 and the military-tech capabilities required, I'm guessing it was us, though giving a wink to someone else is entirely possible as well.
[Doug] Mentioned, it opens the idea of bombing the canals etc. Hard for me to believe any of these did it. But then, who did? The silence on it is stunning. Implication in the story is, they know and they're not telling.
Germany will investigate it:
https://www.foxnews.com/world/germany-opens-investigation-into-baltic-sea-pipeline-explosions
That seems rather belated.
Sweden is investigating, but won't tell the results:
https://nworeport.me/2022/10/11/sweden-refuses-to-share-results-of-nord-stream-pipeline-explosion-investigation-with-russia/
They can't tell us without telling Russia. So we make war decisions in representative government based on rumor?
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https://twitter.com/AZgeopolitics/status/1579824260981624832
https://media.gab.com/cdn-cgi/image/width=1050,quality=100,fit=scale-down/system/media_attachments/files/117/724/612/original/18def87f6525c59e.jpg
(https://media.gab.com/cdn-cgi/image/width=1050,quality=100,fit=scale-down/system/media_attachments/files/117/724/612/original/18def87f6525c59e.jpg)
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https://www.zerohedge.com/markets/back-old-days-europeans-panic-buy-firewood-and-stoves
General Winter is coming for a long visit.
Pray for global warming.
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The Inflation Hydra! Los Angeles Diesel Prices UP 176% Under Biden While Strategic Petroleum Reserve DOWN -34.7%
https://confoundedinterest.net/2022/10/11/the-inflation-hydra-los-angeles-diesel-prices-up-176-under-biden-while-strategic-petroleum-reserve-down-34-7/
Are these the people we want in charge?
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(https://mcusercontent.com/dc8d30edd7976d2ddf9c2bf96/images/de66d79b-5c5c-f138-f6c0-638519370fbf.png)
https://mcusercontent.com/dc8d30edd7976d2ddf9c2bf96/images/de66d79b-5c5c-f138-f6c0-638519370fbf.png
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World famous environmental super hero agrees with Doug. (Caught reading the forum.)
Greta Thunberg Calls Possible Shutdown of Nuclear Power Plants in Germany a Mistake.
You don't say.
https://www.latestly.com/socially/world/new-greta-thunberg-calls-the-possible-shutdown-of-nuclear-power-plants-in-germany-a-latest-tweet-by-disclose-tv-4316310.html
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World famous environmental super hero agrees with Doug. (Caught reading the forum.)
Greta Thunberg Calls Possible Shutdown of Nuclear Power Plants in Germany a Mistake.
You don't say.
https://www.latestly.com/socially/world/new-greta-thunberg-calls-the-possible-shutdown-of-nuclear-power-plants-in-germany-a-latest-tweet-by-disclose-tv-4316310.html
Greta is hoping to avoid the kinetic consequences many greens will suffer this winter.
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https://media.gab.com/cdn-cgi/image/width=1050,quality=100,fit=scale-down/system/media_attachments/files/117/723/284/original/4050ec0d9fe9a29d.jpg
(https://media.gab.com/cdn-cgi/image/width=1050,quality=100,fit=scale-down/system/media_attachments/files/117/723/284/original/4050ec0d9fe9a29d.jpg)
At this point, what difference does it make?
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https://www.theepochtimes.com/sweden-opts-out-of-joint-probe-into-nord-stream-leak-refuses-to-share-findings-citing-national-security_4798122.html?utm_source=Goodevening&src_src=Goodevening&utm_campaign=gv-2022-10-15&src_cmp=gv-2022-10-15&utm_medium=email&est=P0lUWV1qLjwu7e6eDXWIHYzYiB%2BiLJwAFphgdqbYjX9M4HMIe6fYmAisV1kIw8XnTH8b
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https://www.theepochtimes.com/sweden-opts-out-of-joint-probe-into-nord-stream-leak-refuses-to-share-findings-citing-national-security_4798122.html?utm_source=Goodevening&src_src=Goodevening&utm_campaign=gv-2022-10-15&src_cmp=gv-2022-10-15&utm_medium=email&est=P0lUWV1qLjwu7e6eDXWIHYzYiB%2BiLJwAFphgdqbYjX9M4HMIe6fYmAisV1kIw8XnTH8b
Why?
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Shhhh , , , that is a secret.
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Shhhh , , , that is a secret.
I'd be willing to bet that if there was any evidence that pointed to Russia, we'd hear all about it.
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https://www.youtube.com/watch?v=PsliZbzSR-8
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second
https://www.youtube.com/watch?v=WaL9r-Kn5bc
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https://www.manhattancontrarian.com/blog/2022-10-16-they-cant-make-green-energy-using-only-green-energy
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Lebanon and Israel Ink a Historic Deal on Disputed Offshore Gas Reserves
6 MIN READOct 17, 2022 | 21:47 GMT
A Lebanese-Israeli maritime deal will ease tensions caused by the natural gas fields off the Levantine coast, pave the way for Lebanese energy extraction and increase calls in Lebanon for deeper economic ties with Israel. On Oct. 11, Israeli Prime Minister Yair Lapid and Lebanese President Michel Aoun announced they had signed a U.S.-mediated deal on divvying up energy resources in disputed waters in the Eastern Mediterranean. The agreement grants Israel exclusive control over the disputed Karish gas field, which is estimated to have 1.75 trillion cubic feet (tcf) of reserves. In exchange, Lebanon will be able to develop the Qana gas field on the basis that Israel is still compensated for resources extracted in nominally Israeli waters. The same day the agreement was announced, Hezbollah — the Iran-backed Lebanese political party and militant group who had initially staunchly opposed ceding the Karish field over to Israel — signaled it would not use its influence in Lebanon's parliament to block the deal's ratification. Other details (like the final delineation of Israel and Lebanon's maritime border) were not settled by the agreement, and appear to await more negotiations.
Israel and Lebanon remain in a state of war and do not have a formalized border. For decades, the regional rivals have disputed a piece of land on their mutual frontier called the Shebaa Farms.
Israel and Lebanon also have overlapping maritime claims, with Israel's claim extending around the Qana prospect while Lebanon's claim covers roughly half the Karish gas field. Following the discovery of those gas fields in the 2000s, both countries have sought to establish a final maritime border to enable energy exploration and development in the region.
U.K.-based Energean is already preparing to extract gas from the Karish field, with tests now underway, while Lebanon has called on French multinational TotalEnergies to explore the Qana gas field.
As negotiations were underway and energy company Energean brought in equipment to extract gas from Karish, Hezbollah threatened to attack the field if Lebanese demands were not met and flew drones to harass the rigs several times. Israel threatened to respond with strikes on Hezbollah inside Lebanon if they carried out such an attack.
The Karish and Qana fields are smaller than Israel's other gas fields, Leviathan and Tamar, which together are estimated to have nearly 30 tcf of gas reserves. Qana's reserves have yet to be proven and are widely suspected to be smaller than Karish's reserves. But if the deal is ratified, Qana would be Lebanon's first gas field for a country that imports all its energy needs.
Israeli and Lebanese lawmakers are ultimately likely to ratify the agreement, though political factions in both countries could still try to modify or jettison it for ideological reasons. Israel's Security Cabinet approved the agreement on Oct. 12 and sent it to lawmakers in the Knesset for review. Under Israeli law, Knesset members cannot block the maritime deal but they can signal their opposition to it, which could, in theory, embolden Israel's nationalist Interior Minister Ayelet Shaked to formally vote against the motion when it returns to the Security Cabinet for a final vote — a move that could pressure the deal to go to the Knesset, where it's uncertain it would pass. Shaked abstained in the initial vote on the maritime deal on the basis that it didn't go far enough to secure Israel's interests. However, with his Jewish Home party currently polling below the threshold needed to enter the Knesset in Nov. 1 elections, Shaked appears unlikely to politically benefit from blocking the agreement, which could trigger a backlash from Israel's security establishment for bringing back tensions to the fields just as Israel begins production from Karish at the end of the month. In Lebanon, individual members of parliament could complain that the deal grants the country a less valuable gas field while it also brings Lebanon closer to normalization with Israel, which is deeply unpopular. However, Lebanese politicians are aware that TotalEnergies will not explore Qana without a deal in place, while Hezbollah knows that it is not well-positioned to stop Israel from extracting from Karish with or without an agreement. These calculations suggest that Lebanon will also ratify the deal.
Israel's opposition parties, led by former Prime Minister Benjamin Netanyahu, have slammed the agreement as a surrender to Hezbollah because it gives up Israeli claims to the Qana field. While Shaked's Jewish Home party is tempted to echo those arguments to potentially be part of a future right-wing government, it's unlikely such a gambit would work to win supporters in the upcoming election. Right-wing voters have already soured on Jewish Home for joining the current coalition that includes left-wing and Islamist rivals to the right wing.
Lebanon's economic crisis is making it hard for Hezbollah to credibly threaten to use military force to stop Israel's production in the Karish field, which would go ahead with or without an agreement. Hezbollah cannot politically afford another expensive war with Israel over the fields, while its patron, Iran, has shown little interest in ordering Hezbollah to escalate over the issue as well.
If the deal goes through, it would substantially decrease the threat of military escalation over the gas fields, allow Lebanese energy development, remove one stumbling block to an Israeli-European and/or Turkish pipeline, and increase calls in Lebanon for other ties with Israel. Hezbollah's surrender to the agreement signals that the militant group will likely reduce provocations and rhetorical threats against the Karish field. However, they may continue to conduct harassment flights and will likely threaten the rigs if Israel's tensions with Lebanon and Iran increase in a broader context. Additionally, TotalEnergies would be able to proceed with gas development in the Qana field, possibly leading to gas production if substantial reserves are found. The agreement also brings Israel closer to the reality of a European or Turkish undersea gas pipeline, though it will still need to find ways through Syria- and Cyprus-controlled waters to do so. Meanwhile, some Lebanese political figures will likely try to build on the deal by calling for deeper cooperation with Israel, which could unblock needed humanitarian aid and mitigate the risk of the crisis-ridden country entering another costly war with Israel.
The patriarch of Lebanon's Maronite Christian church, Bechara Boutros al-Rahi, and other influential Lebanese leaders have sought to ease anti-Israeli sentiment among their followers in the hopes of reducing the risk of a public call for war during future periods of tension with Israel.
Israel has offered humanitarian aid to Lebanon multiple times, including after the 2020 Beirut port explosion and in 2021 as its financial crisis continued. Hezbollah rebuffed these offers.
The proposed EastMed pipeline could theoretically connect Eastern Mediterranean gas fields to Europe. But the project is running into economic viability challenges because of the cost stemming from the pipeline's need to go through deeper waters. Meanwhile, attempts to connect these fields to Turkey could run into more diplomatic disputes north of Lebanon. Syria and Israel remain technically at war, and Turkey has maritime disputes with both Greece and Cyprus that make a pipeline project too risky to complete.
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https://www.dailymail.co.uk/news/article-11326397/White-House-plans-release-15-MILLION-barrels-oil-USs-emergency-stockpile.html
Strangest thing about the story is they admit it.
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https://www.zerohedge.com/geopolitical/first-images-blown-nord-stream-reveals-50-meter-missing-section-pipeline
https://journals.sagepub.com/doi/pdf/10.1177/1687814017729089
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https://twitter.com/WallStreetSilv/status/1582094359373426688
BTW, those LNG tankers are massive floating bombs.
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In a similar vein I wonder how big the gas clouds are around the holes in the NS?
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In a similar vein I wonder how big the gas clouds are around the holes in the NS?
I guess one was turned off when it happened and the other not live yet. (?) Still the one off for maintenance may have had gas in the line?
https://www.reuters.com/business/energy/nord-stream-1-gas-flows-dwindle-maintenance-begins-2022-07-11/
If they were both live, the release would be unimaginable.
"Fatih Birol, the head of the International Energy Agency, said it was "very obvious" who was behind it but did not say who that was.
https://www.reuters.com/world/europe/qa-nord-stream-gas-sabotage-whos-being-blamed-why-2022-09-30/
It's hard to analyze WWIII without knowing who blew up the pipeline and who may retaliate.
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The U.S.-Saudi Rift Over Oil Prices Is Déjà Vu All Over Again
Biden repeats some of Nixon’s mistakes in dealing with Riyadh and Tehran and makes some new ones.
By Karen Elliott House
Oct. 19, 2022 11:38 am ET
The Biden administration finds itself simultaneously snubbed by two bitter rivals, Saudi Arabia and Iran. That’s quite a costly feat for the U.S., a nation that relies on stable oil prices to sustain a healthy economy.
Relentless pursuit of a chimerical nuclear deal with Iran—first by the Obama administration and now its Biden redux—has left Saudi Arabia with no trust in its former partner and protector. As a result, the kingdom, which Joe Biden once said he wanted to make a “pariah state,” has declared unequivocally its independence from American leadership by befriending Russia and China and cutting oil production to shore up its revenue despite repeated pleas from the White House.
How times have changed. Nearly a half-century ago, Saudi Arabia single-handedly rescued the U.S.—and the world economy—from recession by refusing a 15% price hike proposed by the oil cartel then dominated by the shah of Iran. When the cartel proceeded anyway, the Saudis flooded the market with oil, driving down prices and bankrupting Iran. In exchange the U.S. agreed to sell arms to Riyadh, beginning a 50-year buying spree that has made the kingdom the largest purchaser of U.S. weapons.
With a dramatic flair foreshadowing Crown Prince Mohammed bin Salman’s bravado, Saudi Oil Minister Ahmed Zaki Yamani arrived at the December 1976 cartel meeting in Doha, Qatar, to propose a six-month price freeze. Rebuffed by all cartel members, he walked out, returning eight hours later from Riyadh to announce the kingdom not only rejected a price hike but would enforce its decision by boosting its production from 8.5 million barrels a day to 11.8 million.
“Is it fair for others to decide [the price of Saudi crude] against our will?” he asked reporters as he stalked out of the meeting. The soon-to-be-overthrown shah called him “Judas Iscariot.”
In those days, the U.S. was dependent on foreign energy for 40% of its needs. By 2019 the U.S. was a net energy exporter. But thanks to President Biden’s suppression of domestic energy production in an effort to boost green energy, the U.S. this year is again a net energy importer.
Some things haven’t changed. The White House still puts domestic politics ahead of national interests. In the ’70s, as now, the White House begged the cartel to wait until after the U.S. elections to fiddle with prices.
Another thing that hasn’t changed is presidential blundering. Before resigning, Richard Nixon, like Mr. Biden, favored high prices as an incentive to develop alternative energy sources—and to fund Iran’s massive purchases of U.S. arms so the shah could serve as America’s bulwark for stability in the Mideast. That arms buildup in Iran alarmed Saudi Arabia then. Now the Saudi monarchy is fed up with Mr. Biden’s repeated disparagement of oil as an evil that must quickly be replaced by expensive green alternatives that aren’t yet anywhere near capable of sustaining global energy needs.
Another déjà vu: Iran’s nuclear ambitions. Even half a century ago Iran was seeking the bomb, thus forcing the U.S. to juggle two contradictory goals: curbing the global spread of nuclear technology and pacifying the shah. The Americans offered a deal allowing Iran to reprocess and store plutonium on its soil if carried out in a multinational plant that the U.S. would manage and secure. The shah stubbornly insisted that if he was such a valued friend of Washington, he ought to be allowed to control his own nuclear fuel. Today, that largely remains the demand of the Islamic theocracy that overthrew him.
The enmity between Iran and Saudi Arabia remains deep, though now it is the Saudis rather than the Iranians who believe they are in the driver’s seat. But Riyadh would do well to remember that when Iran launched drone attacks on the Saudi Abqaiq oil facility in 2019, removing 5.7 million barrels a day of production, there was no U.S. retaliation. The Iranians could try something like that again under the assumption that Mr. Biden’s outrage at the Saudis’ decision to cut production means the U.S. would simply stand by. With Democrats in Congress demanding an end to U.S. weapons sales that have helped protect Saudi oil installations, and the Biden administration’s continued desperate efforts to secure a nuclear deal with Iran, it seems a reasonable bet that Washington would see this as teaching the Saudis a lesson, albeit an expensive one.
It’s hard to exaggerate the consequences of a serious disruption of Saudi oil on global political and economic stability—and on the kingdom. Saudi Arabia now is the world’s largest oil producer and any serious interruption while the West is boycotting Russian oil could leave Western Europe so desperate for energy it would abandon Ukraine.
This would be a big win for Russia and a huge defeat for the U.S. With the world already on the verge of recession, a big price spike caused by disruption of Saudi oil could precipitate a prolonged and deep global turndown. And the crown prince, whose ambitious and expensive Vision 2030 reforms are driving him to keep oil revenue high, could face his own economic depression with all the disappointment that would heap on his restless and demanding young citizens.
History would seem to teach both President Biden and Crown Prince Mohammed to reflect on the consequences of their policies way beyond November’s election.
Ms. House, a former publisher of The Wall Street Journal, is author of “On Saudi Arabia: Its People, Past, Religion, Fault Lines—and Future.” She covered energy as a reporter for the Journal, 1975-78
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https://www.newsmax.com/us/joe-biden-oil-strategic/2022/10/19/id/1092568/
anyone see specifics about how he plans to boost production,
and buy back oil at 3 to 4 times the price Trump wanted to buy it ?
I predict
day after election Biden will say :
"we do not need to boost domestic production "
the LEFT media will be applauding this
and telling us how great he is .....
totally justified cynic in NJ.....
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https://www.westernjournal.com/wyoming-electric-vehicle-road-trip-nightmare-man-spends-15-hours-travel-178-miles-across-state/
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https://www.theamericanconservative.com/the-threat-of-civil-war-in-europe/
Shakes fist at Putin
MARC: Pasted this in the EUROPE thread-- better there.
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https://summit.news/2022/10/20/video-biden-energy-advisor-admits-that-the-regime-wants-to-limit-oil-production-to-accelerate-the-transition/
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https://summit.news/2022/10/20/video-biden-energy-advisor-admits-that-the-regime-wants-to-limit-oil-production-to-accelerate-the-transition/
(https://i0.wp.com/www.powerlineblog.com/ed-assets/2022/10/Screen-Shot-2022-10-21-at-12.23.26-PM.png?w=852&ssl=1)
Real Headlines.
https://i0.wp.com/www.powerlineblog.com/ed-assets/2022/10/Screen-Shot-2022-10-21-at-12.23.26-PM.png?w=852&ssl=1
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https://summit.news/2022/10/20/video-biden-energy-advisor-admits-that-the-regime-wants-to-limit-oil-production-to-accelerate-the-transition/
(https://i0.wp.com/www.powerlineblog.com/ed-assets/2022/10/Screen-Shot-2022-10-21-at-12.23.26-PM.png?w=852&ssl=1)
Real Headlines.
https://i0.wp.com/www.powerlineblog.com/ed-assets/2022/10/Screen-Shot-2022-10-21-at-12.23.26-PM.png?w=852&ssl=1
It’s just a coincidence, Doug!
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https://www.bbc.com/news/business-63331709?fbclid=IwAR3S1BjBuPk-DAXnPLR_LoSrPW-hLo1PoUSOVrToY81LhejYNLpSCnOurl0
Does this mean things will not be as catastrophic as feared?
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https://michaelyon.locals.com/upost/2953311/cannot-make-up-this-stuff
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https://www.wsj.com/articles/rishi-sunak-wont-frack-u-k-natural-gas-liz-truss-russia-vladimir-putin-11666901841?mod=opinion_lead_pos4
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Looks like a conservative in name only.
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I am not familiar with any Goldman Sachs ex exec turned politician who are not liberals
from the several I am familiar with they are all globalists climate change diversity and the rest
ilk
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October 28, 2022
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UK Energy Costs Are Through the Roof
A price cap is set to expire in April.
By: Geopolitical Futures
UK Energy Prices
(click to enlarge)
Following the downfall of another prime minister and the British pound’s collapse to its lowest level ever against the dollar, the U.K. urgently needs to tackle energy prices. In June, regulatory body Ofgem reported that more than 2.3 million British households are behind on their electricity bills and 1.9 million are behind on gas bills. Both figures are some 70 percent higher than at the end of 2020.
As part of her doomed mini-budget, the former prime minister, Liz Truss, introduced a bill to cap energy costs for consumers. Estimates of the program’s costs ranged from 60 billion to 150 billion pounds ($70 billion to $175 billion). It was supposed to last two years, but the new finance minister said it will now expire in April 2023. With the U.K. already in an economic crisis, the government will have its hands full dealing with the social fallout when the price cap ends.
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https://andmagazine.substack.com/p/europe-is-transitioning-to-coal
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Can Europe's Industrial Sector Survive Without Russian Gas?
16 MIN READNov 3, 2022 | 17:43 GMT
EU efforts to shore up energy supplies and reduce consumption have lowered the likelihood of natural gas shortages in Europe between late 2022 and early 2023. But sustained high energy prices and demand destruction will likely hurt Europe's economic growth and industrial competitiveness in the medium-to-long term. EU countries approved on Oct. 20 a new package of emergency energy measures aimed at addressing the bloc's energy crisis, the fourth since Russia's invasion of Ukraine. EU leaders agreed on an emergency brake on price spikes through a dynamic price corridor — allowing the European Commission to work on the development of a new gas price benchmark tied to liquified natural gas (LNG) prices in the meantime — and to explore the temporary use of a price cap on gas used in electricity generation. Countries also agreed on a voluntary plan to jointly purchase gas and increase leverage in negotiations with global gas suppliers and on measures to increase energy savings, alleviate liquidity stress and price volatility in energy markets, increase energy solidarity in case of gas supply shortages in the absence of bilateral agreements, and simplify permitting procedures to accelerate the roll-out of renewables.
In May, the European Union unveiled 210 billion euros worth of measures aimed at reducing the bloc's reliance on Russian fossil fuels. To ease the impact of higher prices on households and businesses, Brussels also unveiled gas demand reduction targets In June, followed by windfall taxes on energy producers in September.
As part of the new package of energy measures announced on Oct. 20, member states agreed to pursue the creation of a new LNG price index that would help separate imported gas from the Dutch benchmark, Title Transfer Facility (TTF), by March 2023. TTF is traditionally dominated by pipeline gas transactions, the vast majority of which previously came from Russia and have since been replaced by LNG.
Member states have also tasked the European Commission with compiling a proposal for a ''temporary framework to cap the price of gas in electricity generation,'' which will include a cost/benefit analysis. This is the result of a compromise between EU members on the controversial issue of capping natural gas prices in the bloc. Most countries (including France, Italy, Spain, and Poland) have been pushing to enact such an EU-wide price cap in order to mitigate skyrocketing energy costs. But Germany and other countries have been more skeptical — fearing market interventions could endanger the security of the bloc's energy supplies by reducing European buyers' ability to outbid competitors in the increasingly tight global gas market. While Germany and other like-minded countries agreed to have the commission draw up a potential price cap, they could still veto the final proposal.
Under the new measures, joint purchasing will be voluntary, with a requirement for 15% of the volume needed to fill gas storage to be bought as a bloc.
In recent months, Europe has reduced its reliance on Russian gas by increasing gas storage levels, switching to alternative sources of energy, diversifying supply, and reducing overall gas consumption. Europe's energy supply crunch has intensified in the past month. In late September, suspected sabotage attacks damaged both of the Nord Stream pipelines that supply Russian gas to Europe via the Baltic Sea, dashing hopes that gas flows would increase anytime soon after Moscow took Nord Stream 1 offline in September in retaliation against EU sanctions. Prior to the war in Ukraine, 40% of the natural gas consumed by EU countries was supplied by Russia through the Nord Stream and other pipelines. That percentage has since dropped to just 9%, with Europe now only receiving limited amounts of contracted Russian gas via the pipelines in Ukraine and Turkey. Despite this, Europe looks increasingly prepared to withstand a winter without Russian gas, as reflected in the market by five consecutive weeks of falling prices. This is due to ongoing efforts to increase gas storage levels on the Continent, switch to alternative sources of energy, diversify supply, and reduce overall gas consumption (and with significant help from unseasonably warm October weather).
Storage: Gas storage facilities are now around 95% full. This should ensure a relatively well-supplied winter, provided that non-Russian supplies remain stable and that Europe doesn't experience colder-than-usual weather.
Substitution: Europe's consumption of coal in electricity generation increased significantly in 2022, mostly to compensate for significantly lower hydropower and nuclear electricity generation. Rising flows of crude and oil products (mostly diesel) from Asia and the Middle East are supporting the gas-to-oil switch in Europe before a ban on Russia's seaborne crude oil enters into force in December, followed by a ban on Russian oil products in February 2023. Germany decided to keep its 3 nuclear reactors running until April 2023 and Belgium postponed the closure of two of its reactors. Other countries are accelerating nuclear development plans as well.
Demand reduction: EU countries so far have agreed on a voluntary target to cut natural gas and electricity consumption by 15% and 10%, respectively, and a mandatory reduction target of 5% for electricity consumption in peak hours through March 2023.
Supply deals: Pipeline gas and LNG supplies into Europe from Azerbaijan, North Africa and Norway have increased since the start of the war in Ukraine, but remain far below those Russia used to provide. Italy has been the most active European country in this sense. New supply deals will bring an additional 24 billion cubic meters (bcm) of natural gas to Europe in 2022, 10 bcm in 2023, and 64 bcm in the next few years, according to estimates from the Bruegel think tank.
New infrastructure: Europe has been expanding the infrastructure needed to import more gas. Germany leads the way in floating storage regasification units (FSRUs) capacity additions, providing Europe with roughly 10 bcm/year of new regasification capacity by 2022, and 50 bcm/year by 2024. Countries are also building new gas pipelines, with new interconnectors already coming online in 2022. The 10 bcm/year Baltic Pipe connecting Norway to Poland via Denmark came online on Oct. 1. Other projects will also come online in the next few years, with Poland commissioning a new pipeline connecting its network and LNG terminals with Slovakia in August and asking for EU funding to finance a new gas link with the Czech Republic in September. Spain, Portugal, and France agreed on Oct. 20 to build a new hydrogen/natural gas pipeline connecting Barcelona to Marseille.
Renewables: The European Union announced the REPowerEU package less than two weeks after Russia's invasion of Ukraine, aiming to make Europe independent of Russian energy supplies by 2030. Renewables will play a key role in this strategy. EU countries have accelerated renewables deployment, particularly by setting up investment schemes in renewable energy projects and simplifying rules and tender procedures. However, it will likely be months before these measures start having a meaningful impact on Europe's energy supplies.
With short-term supply-side solutions largely exhausted, Europe will now mostly focus on coordinated demand reduction to decrease the likelihood of gas shortages this winter. The European Union's close-to-full gas storage, combined with unseasonably warm weather and lower natural gas consumption, is easing immediate concerns over the security of the bloc's energy supplies. Reducing demand, however, will be key in ensuring EU states have enough gas to get them through the winter without leaving people and businesses in the cold, given Europe has now largely exhausted its short-term alternatives to Russian energy exports. Although changes in consumer behavior (such as lowering heating in private and public buildings) have helped, the recent drops in Europe's energy usage are largely being driven by falling industrial consumption. By decoupling from Russian gas, Europe is upending its industrial model based on cheap and reliable energy supplies, with impacts likely to reverberate across the Continent's economy for the foreseeable future.
Several European governments have mandated or recommended measures to reduce energy consumption across public and private organizations, but higher prices are also incentivizing households and commercial businesses to cut back consumption.
Natural gas prices in Europe are still more than three times higher than the period's previous five-year average, but they have fallen more than 70% below the peaks seen in August, when they soared above 300 euros per megawatt-hour.
While LNG will remain the main alternative to make up for losses in volumes from Russia, only a handful of FSRUs will be operational by the end of the year, which means that the risk of insufficient supply during the winter will persist.
In case of a complete cut-off from Russian supplies, the European Union would need to reduce natural gas use by 13% over the winter to avoid energy shortages, according to the International Energy Agency's (IEA) latest quarterly gas report.
In the short term, while full storage and energy-saving plans are reducing the risk of winter shortages, gas rationing may still prove necessary given tight supply-demand balances. While looking increasingly prepared to withstand the coming winter, Europe continues to face serious challenges amid minimal Russian gas supplies and competition from Asian buyers on the global market for expensive LNG shipments. Global gas supplies will remain tight through the winter, which means prices will also remain high and volatile. Any additional disruptions that affect this already extremely fragile supply-demand balance could still force countries to impose rationing measures in the coming months. Central and Eastern European countries — which are particularly reliant on Russian gas and have few alternative supply sources — would be hit hardest by such measures, though any eventual gas rationing would also be painful for Italy, Germany, and Austria due to their high reliance on gas for heating, industry, and electricity production. In such a scenario, energy-intensive sectors would be the most affected. But even without rationing, high gas and electricity prices will continue to threaten Europe's manufacturing base, with disruption in gas-intensive sectors affecting industries down the value chain that, whenever possible, will have to source substitution inputs for chemicals, steel, and other basic products from outside the European Union. Even less energy-intensive companies in the manufacturing sector will face increased supply chain risks if their suppliers are heavy gas users. More broadly, most European corporate sectors will be affected by the overall economic downturn affecting the Continent as high energy prices negatively impact demand for goods and services by reducing consumers' purchasing power.
Any unforeseen event that further disrupts global gas supplies or increases demand could easily drive prices up and create more shortages in the months ahead. A colder-than-expected winter in Europe, for example, could increase domestic energy usage, eating into the Continent's gas stockpiles. But a colder-than-expected winter in Asia could also impact Europe's supplies by increasing competition for global LNG volumes. Any non-Russian supply disruption (for instance in the North Sea or the Atlantic due to adverse weather events) could create more global supply and price shocks as well.
While not all European regulators published details on the rank of order and gas volumes that would be made available to each sector in case of shortages, under emergency protocols in most countries, households and critical infrastructure would be allocated energy ahead of industrial operators.
In the medium term, as prices will remain high and supplies limited while replenishing stocks could be an even bigger challenge, demand destruction will continue to hurt economic growth. Europe's energy markets are set to remain tight over the next couple of years. The Continent is expected to enter March 2023 with exceptionally low energy supplies after heavily depleting its stockpiles during the cold winter months. And Europe will likely struggle to replenish its reserves for the next couple of winters as well, due to very limited access to Russian gas, only marginal gains in non-Russian import capacity, and a recovering Chinese demand exacerbating competition for LNG. This means that continued demand destruction across the Continent is probable through at least 2024, when significant new supply becomes available. Switching to alternative and/or renewable energy sources, along with price-driven drops in household consumption, will help Europe endure this period of reduced gas supplies. But while these limited gains in demand reduction will help ease natural gas prices in Europe over the next year, most of that easing will continue to come from lower industrial consumption. Energy-intensive sectors will have to continue reducing output or halting operations altogether, with knock-on effects on economic growth that will deepen the recession Europe is already expected to enter next year and prevent any strong recovery until 2024. This, in turn, may lead to significant job losses and increase the risk of social unrest in European countries. Slower growth and high prices will also put further strain on public finances across Europe, with governments keeping financial support for households and businesses and bailing out struggling utilities and insolvent companies to prevent a wave of bankruptcies, which will push debt levels higher amid rising borrowing costs and raise concerns over debt sustainability.
With Europe's non-Russian import capacity increasing only marginally, the installation of five FSRUs in Germany and one in Italy will account for the biggest increase in supply until March 2023. But competition for limited LNG will not ease until 2024.
Europe's gas storage units are typically 20% full at the end of an average winter season. But without imports of Russian natural gas that would normally continue throughout winter, storage levels are set to near zero by March 2023. In preparation for next winter, the European Union is aiming to have 95% of its gas reserves filled by November 2023. However, given the expected depletion of supplies this winter, hitting that target will require the bloc to purchase 20% more gas than in previous years, which Brussels will have to achieve without its once largest supplier: Russia.
In a report published on Nov. 3, the International Energy Agency (IEA) said the European Union would face a supply-demand gap of about 30 bcm this summer, in case of both a complete cut-off of the bloc's Russian pipeline gas supplies and a recovery of Chinese LNG imports to 2021 levels. According to the IEA, such a gap could represent almost half the gas needed to meet Brussels' 95% storage target by the start of the 2023-24 winter heating season.
In the long term, Europe's supply diversification, demand destruction and high energy prices may negatively impact the Continent's competitiveness in energy-intensive industrial sectors. While infrastructure development and long-term LNG supply deals will ensure that Europe receives adequate supplies of non-Russian energy in the future, energy supplies to the Continent will remain more expensive than they have been for the past few decades if Europe does not restore its pre-war energy relationship with Russia once the conflict in Ukraine ends (or freezes). Sustained higher input costs risk making European products less competitive compared with their North American or Asian equivalents, particularly in countries that utilize high amounts of gas in industry and/or power generation. Prior to its energy crisis, Europe was able to undercut Asian countries, which were forced to import LNG, by using cheap Russian energy, but since Europe is now also reliant on LNG imports , that competitive advantage has disappeared. Some industrial players with operations in Europe will have to decide whether to maintain lower production, operate at lower margins, shut down or relocate. However, European manufacturers have long operated at a competitive disadvantage against peers in the United States, where gas prices have been on average two to three times cheaper than in Europe for the past decade, without facing deindustrialization or large losses in market share. This indicates that while increased energy costs will create headwinds for European industries, they will not lead to a complete deindustrialization of the Continent.
Europe's industrial base employs about 35 million people, which is roughly 15% of the Continent's total workforce. However, according to research firm Rhodium Group's estimates, 81% of industrial gas consumption in the European Union is concentrated in five energy-intensive sectors — refining and coking, chemicals, basic metals (iron and steel), non-metallic mineral products (mostly serving the construction sector), and paper — that together account for only a modest share of overall economic value (3%) and employment creation (2%). While relatively small compared with other manufacturing sectors, these industries still directly employ millions of European workers and create annually several hundred billion euros of economic value, especially considering the value and jobs generated from associated supply chains.
Germany's BASF, the world's largest chemicals producer, announced on Oct. 26 that it would need to ''permanently'' reduce its costs and operations in Europe due to high energy prices, high regulatory standards and an increasingly sluggish chemicals market.
In absolute terms, Germany's economy will see the largest losses from reduced industrial production, as the country alone accounts for a quarter of all industrial gas demand in the European Union. However, the impact will be higher in countries and regions that place more importance on gas-intensive sectors in the overall economy and employment, such as Austria, Belgium, Bulgaria, the Czech Republic, Finland, northern Italy, Poland, Romania, Slovakia, Slovenia and Sweden.
Persistently high energy prices and dual-use development infrastructure will, however, also incentivize a quicker deployment of renewables, while likely EU carbon tariffs will partially offset incentives for delocalization. While current emergency responses to the energy crisis are likely to crystallize natural gas demand in Europe until at least the late 2020s or early 2030s, they are also accelerating the Continent's transition to low-carbon energy sources. As part of Europe's strategy to phase out Russian fossil fuels, a roll-out of renewables at scale will start replacing coal and oil (and then eventually natural gas) once the emergency is called off, probably around 2024. Most current projects to expand Europe's natural gas infrastructure (i.e., import terminals and pipelines) are dual-purpose, meaning that infrastructure could be repurposed for the transport and storage of hydrogen. This would commit the Continent to natural gas only for the duration of long-term LNG supply deals that its countries are signing now. By the time those contracts expire, hydrogen technology may have become an economically viable alternative to natural gas in powering energy-intensive industries, particularly considering the likely implementation of an EU carbon tariff currently set for 2026. Additionally, by the end of the 2020s, high prices will have incentivized larger companies with the financial resources to operate at a cost disadvantage while accelerating energy-transition plans to pursue technological innovation that will eventually make it advantageous again to produce in Europe.
Global green energy investment is set to rise to more than $2 trillion a year by 2030, up by 50% from present levels.
The EU Carbon Border Adjustment Mechanism has the potential to act as the most significant balancing force against European deindustrialization, as it would add costs to offsetting production in regions where carbon emissions reduction requirements are looser for goods exported to the European Union.
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Surprised to read that Europe is topped off at present. I read quite a bit more than most, so why was I ignorant of this?
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Europe’s Energy Crisis: Winter not Canceled
The price mechanism works.
CNN:
Europe has more natural gas than it knows what to do with. So much, in fact, that spot prices briefly went negative earlier this week.
For months, officials have warned of an energy crisis this winter as Russia — once the region’s biggest supplier of natural gas — slashed supplies in retaliation for sanctions Europe imposed over its invasion of Ukraine.
Now, EU gas storage facilities are close to full [around 94 percent, comfortably above initial targets of 80 percent], tankers carrying liquefied natural gas (LNG) are lining up at ports, unable to unload their cargoes, and prices are tumbling.
The price of benchmark European natural gas futures has dropped 20% since last Thursday, and by more than 70% since hitting a record high in late August. On Monday, Dutch gas spot prices for delivery within an hour — which reflect real time European market conditions — dipped below €0, according to data from the Intercontinental Exchange.
Prices turned negative because of an “oversupplied grid,” Tomas Marzec-Manser, head of gas analytics at the Independent Commodity Intelligence Services (ICIS), told CNN Business.
On the rare occasion that (spot) prices for a commodity turn negative (on this occasion, only for about an hour), it’s typically a sign of temporary market dysfunction. For example, West Texas also saw negative gas prices last week when production outstripped what pipelines could cope with. In these situations, negative prices simply mean that holders of the gas pay “buyers” to take it from them.
But, that blip aside, Europe’s energy crunch has not gone away. Today’s unseasonably warm weather and good levels of wind power will not last forever, and gas is still trading at around €108 ($108) per megawatt hour (based on the Dutch TTF benchmark). That’s slightly more than twice where it was at the beginning of October, 2021— a time when prices had already been surging thanks in part to post-pandemic disruptions and some early Russian game-playing.
CNN:
Prices could rise sharply again in December and January as the weather turns colder, providing an incentive for some of those tankers to wait offshore a while longer before coming into port to unload, said Booth.
Another CNN report makes the point that there could be a spike in demand for LNG from China when it emerges from its Covid isolation. And to that end, it’s worth adding that China has recently banned its importers of LNG from reselling it to buyers outside the country, a reminder that Beijing understands that the underlying LNG supply position remains tight. Indeed, the January 2023 gas price is currently around €141/MWh. That compares with a range of €70-€92 in January 2022.
And then there’s the winter of 2023/24 to think about. The ability to fill this year’s storage facilities rested in no small part on Russian gas. But there won’t be much Russian gas to refill them next year. To get an idea of the scale of the challenge, Russia had accounted for around 40 percent of Europe’s gas imports, but that figure now stands at 9 percent and will probably fall further. At best, LNG can only replace about half the missing Russian gas. That’s why prices next winter are forecast to be in the €150–200 range, somewhat above what the futures now indicate.
Qatar’s energy minister has already expressed his concerns about the winter of 2023/24, and he’s in a good position to know. Qatar is the world’s second largest exporter of LNG after the U.S., and it wants to export more. But adding capacity takes time, and has to make economic sense. It takes more than two cold winters to justify the investment. What ‘economic sense’ may mean will not be the same in Qatar as in the U.S., but building a new LNG export terminal in the latter will take 3–5 years. And it costs billions. That would be risky enough even without the potential intervention of climate policymakers.
Global Energy Monitor, April 2022:
Once deployed, export projects could take decades of LNG shipments to recover returns on investment—far beyond the resolution of Europe’s current crisis, and in direct contradiction with international climate goals. For the world to remain on an emissions pathway consistent with the Paris Agreement, the Intergovernmental Panel on Climate Change (IPCC) has called for global methane emissions to decrease 35% by 2030 and the International Energy Agency (IEA) has found that the LNG trade must peak in the middle of this decade.
Must: Something somewhere is going to have to give.
Meanwhile, at least two major projects in the U.S. are — in the words of a Bloomberg report — “inching forward.” But inching forward is not going to do the trick.
Europe also faces fierce competition from Asian buyers for LNG. However, it is adding much-needed import capacity. Turning to floating import terminals (FSRUs – Floating Storage and Regasification Units) rather than onshore installations is speeding things up. These terminals can, to grossly oversimplify, be “parked” offshore. And if one is available for charter, it can be ready to operate within the year. Germany has now chartered five.
But there are currently only around 50 FSRUs in operation worldwide, although another 19 were reportedly under construction at the end of 2021. It says something about European preparedness for this crisis that there were only four active FSRUs in service there at the end of 2021 — and that one of those was moored off Russia’s Kaliningrad exclave. It also says something that one of the others, subtly named Independence, was based in Lithuania.
The quickest way to add to the FSRU fleet is by converting an existing LNG tanker. This takes 18–24 months and costs $100–$150 million. The equivalent figures for a new FSRU are up to three years, and $300 million. Needless to say, there are capacity constraints for both newbuilds and conversions.
The Financial Times’s Chris Giles looks at lower European gas prices and takes a broadly optimistic view. His article is a hymn of praise to the way that people adapt to price changes.
The gas-hungry process of producing ammonia for fertiliser — a low value added business — ceased until a couple of days ago, with the bulk chemical imported from the US. Dirty coal and clean renewables have been used to substitute for gas in electricity generation. Analysis by Ember, a consultancy, has found that there was a record year-on-year increase in solar and wind electricity generation across the EU between March and September.
Ember, it should be added (although Giles doesn’t), describes itself as “an energy think-tank that uses data-driven insights to shift the world from coal to clean electricity.” As part of the “sustainability” eco-system, Ember certainly has an agenda, but there’s no reason to think that its numbers are incorrect. That said, given the amount invested (and still being invested) in wind and solar, it would be disappointing if there had not been an increase in the power they generate. Moreover, given that the problem arising out of wind and solar’s intermittency (the sun doesn’t always shine, the wind doesn’t always blow) has yet to be resolved, it’s fair to ask whether some of those billions would have been better spent elsewhere, not least on nuclear. Answer: They would.
Giles, I think it’s reasonable to believe, is a glass half-full man:
Most impressive of all has been the reduction in consumption of gas by both industrial and domestic consumers, not merely related to the mild weather. In recent weeks, Germany’s industrial use of gas has been around 20 to 25 per cent down on a year ago while its production in the sector was 2.1 per cent higher in August year on year. German household gas consumption is down similar amounts as families compete to see how far into autumn they can go without turning on the heating.
The statistic comparing industrial use with production is impressive on its face, but it would be interesting to see more like-for-like comparisons across countries. The message contained in this report from the Financial Times, for example, was published just a few days before Giles wrote his piece and is rather less upbeat:
On the surface, European industrial companies are putting a brave face on it — talking about the energy-saving measures they are implementing and the other costs they are finding to cut. While some are looking to coal and other fossil fuels to get them through the winter, others talk optimistically about the green revolution that the crisis is spurring.
But there is already evidence that major companies are reducing production in some sectors because of the energy shortage, even before the winter kicks in. And executives from chemicals to fertilisers to ceramics businesses warn that they risk losing permanent market share and could be forced to move some of their production to parts of the world that can offer cheaper and more reliable energy.
The alarm bells are ringing among Europe’s politicians. “We are risking a massive deindustrialisation of the European continent,” says Alexander De Croo, Belgium’s prime minister.
This earlier report includes examples of how some companies have responded to the challenge of higher gas prices with impressive displays of ingenuity, of which, doubtless there will be more to come. But that’s unlikely to be enough to head off trouble:
Gas is the single most important source of energy for Europe’s industrial companies. But gas is also an important feedstock, used in the chemicals and fertiliser industries. In total, industry consumes about 27-28 per cent of the bloc’s total supply, according to Anouk Honoré, deputy director of the gas research programme at the Oxford Institute for Energy Studies.
And:
t is not that easy to cut the fuel out of many industrial processes. Roughly 60 per cent of industrial gas consumption is used for high-temperature processes of 500C and above, such as glassmaking, cement or ceramics.
Similarly, in a good number of cases temporary shutdowns are unfeasible because of the damage they do to machinery. Rather than closing their doors, other firms, as mentioned above, are moving production to facilities outside Europe where energy costs are lower. In many cases, such transfers will not be reversed. Still others are saying that future expansion will be located outside Europe, including in the U.S., where energy costs are (for now) cheaper. But if the Biden administration and its successors move on with decarbonization as currently envisaged, that is an advantage that will be thrown away in this country — something to bear in mind amid all the talk about the jobs that will be created by the energy transition.
The Financial Times, always on message when it comes to climate policy, ends the report on an optimistic note.
But there are those who believe the result of the crisis will be a stronger, greener industrial base. Companies such as Saint-Gobain, Solvay and Smurfit Kappa told the Financial Times they were all accelerating energy-transition plans that were in place before Russia’s invasion. Tony Smurfit, chief executive of Smurfit Kappa, says his company is “spending three times what we would have spent” under previous plans. So there are reasons to be optimistic. “This will accelerate the green revolution. Fifty years ago there were no options for green energy and now there are. I think this will make Europe very green.”
As green, perhaps, as a field where only grass grows.
The FT’s Giles concludes in a similar vein:
The price signal will encourage more investment in liquefied natural gas terminals and in interconnectors across Europe to create a single gas market. But most important, higher prices will lower demand for gas, both by encouraging the development and use of other means of generating electricity and, directly, by crushing the amount consumed.
No one should feel delighted they are paying more for energy this winter, but the price signal has done its job. It has forced Europe to adapt. Advanced capitalist economies are remarkably successful in this regard.
Setting aside the fact that “crushing” demand for gas —whether by the price mechanism or mandated decarbonization — is unlikely to encourage investment in LNG terminals, particularly for exporters, Giles is missing something else. Short-term adaptation has been impressive so far — although considerably more painful than he seems to imply — but over the long term many energy-intensive companies will adapt by moving more and more of their operations elsewhere. Investors who provide the capital that any enterprise requires may feel the same way about where their money should go.
Meanwhile, via the Financial Times:
BASF has said it will have to downsize “permanently” in Europe, with high energy costs making the region increasingly uncompetitive….
“The European chemical market has been growing only weakly for about a decade [and] the significant increase in natural gas and power prices over the course of this year is putting pressure on chemical value chains,” chief executive Martin Brudermüller said on Wednesday.
BASF, which produces products from basic petrochemicals to fertilisers and glues, spent €2.2bn more on natural gas at its European sites in the first nine months of 2022, compared with the same period last year.
Brudermüller said the European gas crisis, coupled with stricter industry regulations in the EU, was forcing the company to cut costs in the region “as quickly as possible and also permanently”
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Do the math! )
Let's say someone (Joe Biden) says to you, we need to ban fossil fuels. Ask them what it takes to generate 38 Billion Megawatt hours capacity of electricity.
"the total additional non-fossil fuel electrical power annual capacity to be
added to the global grid will need to be around 37 670.6 TWh. If the same non-fossil fuel energy mix as that reported
in 2018 is assumed, then this translates into an extra 221 594 new power plants will be needed to be constructed"
https://tupa.gtk.fi/raportti/arkisto/42_2021.pdf
Definition of Terawatt-Hour (TWh)
A terawatt-hour (TWh) is a unit of energy that is equal to 10 raised to the power of 12 watt-hours.
It is also equal to 1,000,000 megawatt-hours (MWh) or 1,000,000,000 kilowatt-hours (kWh).
https://www.carboncollective.co/sustainable-investing/terawatt-hour-twh
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do the math
I think all those European climate activists who glue themselves to art work
should be glued to the wall of a jail cell
for a month hahaha
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"Drill baby drill" is what this country and the world needs right now for the energy crisis, but that is not the slogan that will win the under 30 vote who grew up on "climate change" for breakfast, lunch, dinner and math class.
ccp says Republicans need to address climate change. Why not just do it soberly and honestly, and put that up against the hysterics.
We are subsidizing people (most of them millionaires) to buy electric cars, but the electric cars are powered on the electric grid that is 61% fossil fuel-based.
We are subsidizing solar and wind power with money that goes to China to build more coal plants over there while we feel good about it over here. They build them with coal and ship them with oil and we pay farmers to give up precious farm land to make inefficient electricity.
Solar and wind power have grown exponentially, but by the time that capacity doubles again, our total demand for power will have grown by even more than that with the balance of it made up with fossil fuels - IF WE DON'T START DOING SOMETHING DIFFERENTLY.
Hydro power is great and almost free but is more likely to decline than expand going forward as all the easy sources have been tapped and expanding water usage dries up some sources.
Then there is conservation and efficiency gains. Insulate your homes and inflate your tires, great, but we still want to heat and cool our homes, travel, refrigerate and manufacture. Demand for energy only goes away if it's taken away.
The argument for nuclear power comes through the process of elimination. Comparing all the carbon free sources needed to step up our underpowered grid without fossil fuels, nuclear power wins by every measure.
Wind farms require 360 times more land use than nuclear for the power produced. See what that looks like when you increase the current capacity by 20-50 fold. We will have energy (when the wind blows) but no food. And no birds.
https://www.nei.org/news/2015/land-needs-for-wind-solar-dwarf-nuclear-plants
https://www.forbes.com/sites/rrapier/2022/08/27/nuclear-power-could-cut-the-worlds-carbon-emissions-in-half/?sh=2f8c741f7738
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Doug wrote :
"Drill baby drill" is what this country and the world needs right now for the energy crisis, but that is not the slogan that will win the under 30 vote who grew up on "climate change" for breakfast, lunch, dinner and math class.
YES EXACTLY
all they hear is how their future world will collapse if we don't get rid of fossil fuel
and our response : drill baby drill
which may play well in Alaska or Texas (except Austin. )
but it don't play well in college campuses
or probably even grade school anymore
or in the work movies and shows they watch
I don't know about TIKTOK etc
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Better perhaps than Drill Baby Drill, would be to pitch natural gas as why we are outperfoming the rest of the world in reducing emissions (this is correct, yes?) and the new nuclear technology, while presenting the alternative as a Maoist Green Leap Forward with similar consequences while facilitating Chinese power and creating massive toxicity from the minerals involved in batteries.
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We know what happens when we close nuclear power plants. We closed one in NY in 2019. Coal and natural gas usage goes up.
(https://files.americanexperiment.org/wp-content/uploads/2021/05/Indian-point-nuclear-before-and-after-1024x555.jpg)
Must scroll right to see. Or click on the image link. Wish I knew how to re-size these.
The nuclear line shifts down and coal and gas go up. After all the subsidies, wind is small and up and down. Solar is insignificant.
One nuclear reactor at one facility generated more energy than all wind and solar all across the state combined:
(https://files.americanexperiment.org/wp-content/uploads/2021/04/Indian-Point-vs-wind-and-solar-1024x632.png)
Again, scroll right.
https://files.americanexperiment.org/wp-content/uploads/2021/05/Indian-point-nuclear-before-and-after-1024x555.jpg
https://files.americanexperiment.org/wp-content/uploads/2021/04/Indian-Point-vs-wind-and-solar-1024x632.png
https://www.americanexperiment.org/new-york-nuclear-plant-shutdown-proves-liberals-are-unscientific-and-unserious/
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Stated before but proven here. For every megawatt, gigawatt or terawatt hour capacity of wind or solar you install, you need an equal sized fossil fuel plant to supplement it. That is because the wind goes up and down and so does the sun and they don't offset each other. Demand also goes up and down throughout the hours of the day, the seasons and the temperatures outside and not in any sequence with the above.
Think of a natural gas power plant as a gas stove burner with a knob. A carbon free nuclear plant doesn't scale up and down with demand. It can only provide steady base power. Coal can somewhat but natural gas can do it almost perfectly, except for the carbon dioxide released.
Another scroll right chart to see it all. When wind and solar are down, gas usage is up. It's unavoidable.
(https://files.americanexperiment.org/wp-content/uploads/2021/08/wind-generation-vs-gas-generation-in-MISO-feb-1-through-feb-28-2021-1-1024x596.png)
https://files.americanexperiment.org/wp-content/uploads/2021/08/wind-generation-vs-gas-generation-in-MISO-feb-1-through-feb-28-2021-1-1024x596.png
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From the previous:
"When wind and solar are down, gas usage is up. It's unavoidable."
But the Lefties tell us batteries will make up the difference!
Was it the "infrastructure" bill or the "Inflation reduction Act" where they "invest" a zillion in batteries?
But all the batteries in the world projected to be manufactured by 2030 ...
... will power the world at present rates for 17 minutes. 10 minutes at best if you project demand forward.
Battery backup for a brief outage is different than battery backup for every time the sun or wind goes down which is pretty much every day - for half the day. And my Lithium batteries for with low usage are lasting 3 years.
Soooo... you're going to run all the cars and the trucks in the world on electricity, using batteries, and charge those vehicles on a grid, using batteries, with at least a 6% transmission and distribution loss. How much Lithium is that, and what could possibly go wrong?
My point is, they are lying to you folks. If you buy the whole program, you will be staying home, and in our climate it will be cold at home with the power off. Don't have to dream of a white Thanksgiving this year:
https://www.mprnews.org/story/2022/11/14/photos-twin-cities-sees-first-sticky-snowfall
My numbers are extrapolated from Isaac Orr, Energy Analyst at Center for the American Experiment, Minneapolis.
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Biden Admin Quietly Greenlights Plan to Build Huge Gulf Oil Terminal
By Katabella Roberts November 24, 2022 Updated: November 24, 2022biggersmaller Print
The Biden administration has quietly approved plans to build a new crude oil terminal in the Gulf of Mexico off Texas, seemingly in contradiction to the president’s climate agenda.
The Department of Transportation’s Maritime Administration approved the application (pdf) for Enterprise’s Sea Port Oil Terminal, one of four proposed offshore oil export terminals, on Monday.
According to the application, the port will be located offshore of Freeport, Texas. It will have 4.8 million barrels of storage capacity and add 2 million barrels per day to the U.S. oil export capacity.
In its 94-page decision (pdf), the Maritime Administration said that it had approved the application because the construction and operation of the port is “in the national interest and consistent with other policy goals and objectives.”
“The construction and operation of the Port is in the national interest because the Project will benefit employment, economic growth, and U.S. energy infrastructure resilience and security,” the administration wrote. “The Port will provide a reliable source of crude oil to U.S. allies in the event of market disruption and have a minimal impact on the availability and cost of crude oil in the U.S. domestic market.”
Protests Over Planned Oil Terminal
The decision states that the project will expand on an existing Enterprise Crude Houston operated terminal located in Houston and will generate 62 permanent jobs over 30 years. Additionally, 1,400 temporary construction jobs will be created, with the majority of the workforce being hired from existing labor pools in Texas and Louisiana, according to the application.
The Environmental Protection Agency quietly issued its approval (pdf) of the project in October but stressed that “more emphasis is needed to ensure that environmental justice and climate change considerations are included in the project for the protection of overburdened communities.”
Protests broke out shortly after on the Gulf Coast, The Texas Tribune reported, with climate activists condemning the move, and pointing to the fact that President Joe Biden has prioritized issues such as climate change and clean energy incentives during his time in office. Biden has vowed to cut carbon emissions by 50 percent by 2030.
Ahead of the U.N. climate conference in Egypt this month, the White House said that Biden was set to “announce new initiatives to strengthen U.S. leadership tackling the climate crisis and galvanize global action and commitments,” and that the United States is “acting to lead a clean energy future that leverages market forces, technological innovation, and investments to tackle the climate crisis.”
‘Peak Hypocrisy for President Biden’
Greenpeace promptly took aim at the Biden administration’s decision regarding the new oil terminal, stating that the new terminal would “emit over 300 million tons of carbon dioxide every year polluting the air and water of Brazoria and Harris counties in Texas while creating serious health threats for everyone living there.”
“It is peak hypocrisy for President Biden and Secretary [of Transportation] Pete Buttigieg to shorten the fuse on the world’s largest carbon bomb by greenlighting additional oil export terminals right after lecturing the world about increasing climate ambitions at COP27,” the independent global campaigning network added.
The approval of the Sea Port Oil Terminal would facilitate the safe and efficient long-term loading of large crude carriers while simultaneously slashing oil transportation costs and reducing ship collision risks among other issues, according to officials.
In a separate statement, Kelsey Crane, senior policy advocate at Earthworks, a national organization aimed at ending oil and gas mining pollution, said, “President Biden cannot lead on combating climate change, protecting public health or advocating for environmental justice while simultaneously allowing fossil fuel companies to lock-in decades of fossil fuel extraction.”
The Epoch Times has contacted the Department of Transportation for comment.
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How Fusion Works and Why It’s a Breakthrough
American science scores a triumph, though it’ll be decades before it yields a viable energy source.
By Steven E. Koonin and Robert L. Powell
Dec. 14, 2022 5:34 pm ET
The Energy Department has announced the first gain in energy from fusion in a laboratory—the first time fusion reactions produced more energy than it took to induce them. Last week 192 laser beams at the Lawrence Livermore Laboratory’s National Ignition Facility heated and compressed a capsule of hydrogen to previously unattainable temperatures and pressures, igniting fusion reactions that produced 50% more energy than the laser beams had delivered.
Nuclear reactions can release the energy that binds together protons and neutrons in an atom’s nucleus. Nuclear power plants use fission, not fusion. Fission releases energy when a large uranium nucleus splits into two radioactive fragments, which carry the energy as they fly apart.
Fusion, by contrast, relies on the universe’s smallest atom, hydrogen. Energy is released when two hydrogen nuclei combine to produce a helium nucleus and a neutron. Unlike fission, fusion produces no radioactive fragments. Fusion is much harder to induce than fission, since the hydrogen nuclei must be heated to nearly 100 million degrees Celsius to overcome the electrical repulsion that hinders their reaction. Stars run on fusion energy, but on Earth it has previously been released only in thermonuclear explosions. This stunning new result in laboratory fusion opens doors for unprecedented studies in basic and applied science.
The concept of laser fusion had been pursued without success since the 1960s and it became a central part of a 1990s program to ensure continued confidence in the nuclear-weapons stockpile without underground testing. Although scientists knew that high-powered laser beams could probe the properties of matter relevant to the early stages of detonating a nuclear weapon, the goal of laser fusion would allow for studies in the later stages. It would also challenge and demonstrate the ability to understand and predict the dynamics of hot, dense matter more generally.
Construction of the ignition facility at the Livermore lab began in 1997, and experiments attempting ignition began soon after construction was completed in 2009. The design and construction of the world’s most powerful laser was an engineering triumph, but three years of failed attempts to achieve fusion ignition brought the program close to cancellation in 2012. But the program continued with a more deliberate approach that included outside peer review.
The decade of research from 2012 to 2022 illustrated the ability of the Energy Department’s national laboratories to marshal an interdisciplinary team of scientific and engineering talent from the government, universities and private sector in long-term pursuit of an audacious goal. Researchers in lasers, nuclear and plasma physics, precision-target fabrication, instrumentation and high-fidelity computer modeling helped design and undertake a series of experiments that gradually approached ignition conditions. The payoff came last week.
As recent world events make apparent, the U.S. nuclear deterrent is effective only if there’s confidence that the weapons remain effective. Laser ignition demonstrates to the world a deep understanding of weapons science and will be important in sustaining confidence in the coming decades.
The U.S. hasn’t been alone in recognizing the importance of laser fusion. France and China are building comparable facilities. But as the new American results show, the years of learning were necessary to form a potent intellectual and innovation ecosystem at the National Ignition Facility. The U.S. now leads every other country by a decade because of its foresight, perseverance and research enterprise. Continued investment in laser fusion will ensure that this leadership endures.
These days one can’t mention fusion without thinking about energy. The ignition milestone demonstrates fusion gain, a necessary condition for practical energy production. But that is only the first step. Several decades of engineering would be required to make fusion a practical, emissions-free source of electricity. And even then, it would have to be cost-competitive with alternatives. Like the initial decision to pursue the ignition goal, this is not at all guaranteed. But it’s well worth considering.
Mr. Koonin is a professor at New York University, a senior fellow at the Hoover Institution and author of “Unsettled: What Climate Science Tells Us, What It Doesn’t, and Why It Matters.” Mr. Powell is a professor at the University of California, Davis. Both are governors of Lawrence Livermore National Laboratory.
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I claim considerable prescience here :-D :-D :-D
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December 16, 2022
View On Website
Open as PDF
Turkmenistan Targets the European Gas Market
New pipeline infrastructure must be built first.
By: Geopolitical Futures
Turkmenistan Gas Market
(click to enlarge)
Since Russia invaded Ukraine, Europe has announced its intent to diversify its gas supplies away from Russia. Sensing an opportunity, Turkey is angling to become a natural gas hub and alternative supply route to the European Union from resource-rich countries in the Caucasus and Central Asia. During a trilateral summit on Dec. 14 involving Azerbaijan, Turkey and Turkmenistan, Ankara announced its intention to carry Turkmen gas west through the Caspian Sea.
Since gaining independence, Turkmenistan has strived for neutrality, relying on its huge natural gas reserves. It has sought new export markets for years, and the drop in Russian supplies to Europe is a clear opening. However, new infrastructure must be built first, meaning a solution is far off. Additionally, the Kremlin does not take kindly to competition in the post-Soviet space and, as an important trading partner for Turkmenistan, Moscow has some leverage.
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https://www.gatestoneinstitute.org/19231/belgium-energy-suicide
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GPF
Erdogan and Putin. Russian President Vladimir Putin and Turkish President Recep Tayyip Erdogan spoke by phone about the situation in Ukraine and the Syrian crisis. They also discussed a plan, proposed by Russia in October, to establish Turkey as a natural gas hub using Russian supplies. Ankara is interested in the proposal as part of its broader efforts to stabilize its economy ahead of presidential elections in June.
German energy. Germany’s grid regulator and its economy minister agreed that Berlin should construct 17-21 gigawatts' worth of additional gas power plants by 2030. According to Germany’s energy strategy document, the government wants the country to run on 80 percent renewable electricity and fully phase out coal. To ensure that enough gas is available, the government is committed to LNG development, and the document adds that import capacities will increase. Investment in new LNG capacities will also increase.
===========================================
RANE
The third geopolitical event that altered the balance of power in the European Union was Russia's invasion of Ukraine in February 2022, which led to a spike in inflation across Europe amid tighter and more expensive energy supplies. The economic fallout from the war and the subsequent disruptions to Russian energy exports saw European governments (again) introduce large stimulus packages, as well as desperately look for alternative supplies of natural gas to avoid gas rationing and blackouts. Energy-intensive industries across the continent in sectors ranging from cement to fertilizers were also forced to reduce or halt their operations. The war presented both a risk and an opportunity for Central and Eastern European countries, which for decades had warned about Russia's threat to peace in the continent, and had demanded a greater presence of NATO troops in the region and a more hawkish EU position toward Moscow. Under pressure from Poland and the Baltic states, the European Union imposed economic and political sanctions on Russia while increasing financial, humanitarian and military aid for Ukraine. Notably, the war also forced Germany to break with its decades-old policy that sought to keep political tensions between Russia and the West separated from Germany's massive imports of Russian natural gas. Berlin's decision in February 2022 not to use the controversial Nord Stream 2 pipeline connecting Germany to Russia (which previous German governments had fervently defended) was highly illustrative of this policy change.
Perhaps more crucially, the war also gave NATO a renewed sense of purpose that was in line with Central and Eastern Europe's views, less than three years after French President Emmanuel Macron had declared the military alliance ''brain dead'' and promoted European alternatives to NATO cooperation. The fact that Sweden and Finland broke their historical neutrality to join the Western security alliance realized Poland, Lithuania, Latvia and Estonia's aspiration of completely surrounding Russia in the Baltic region and opened the door to deeper Baltic-Nordic security cooperation.
Finally, the war also increased the strategic importance of Southern European countries, which overnight became key players in the European Union's push to diversify its natural gas supplies away from Russia. Spain and Italy's multiple LNG terminals and their pipeline connections with Northern Africa contrast with Germany's high dependence on pipelines coming from Russia, and put Madrid and Rome at the center of ongoing plans to multiply and diversify the European Union's energy suppliers. In addition, Southern Europe's significant investments in renewable energy (including solar power, which has a huge potential in sun-blessed Mediterranean countries) will only further expand its role in the bloc's energy mix in the coming years —- especially if Northern Europe is willing to pay for the necessary infrastructure to distribute the energy across the continent. Ironically, Europe's energy crunch also resulted in Brussels tolerating countries using more coal, which was a short-term victory for heavy coal users like Poland and other countries in the region.
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https://www.msn.com/en-us/weather/topstories/california-storm-leaves-over-560-000-homes-without-power-more-rough-weather-ahead/ar-AA166ikG
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https://www.foxbusiness.com/energy/oil-industry-exec-rips-white-house-surprising-keystone-admission-biden-created-economic-boondoggle?fbclid=IwAR0lvJhUmcxaZ-7EHRqs8MD8iGv33bJ_mf0O4eaBMbMNnEmafnV054xYfr4
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https://www.sciencealert.com/scientists-just-invented-an-entirely-new-way-to-refrigerate-things
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Far out.
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John Hinderaker reports:
"It doesn't pay to clear the snow off the solar panels because they produce so little electricity in the winter anyway."
https://www.powerlineblog.com/archives/2023/01/solar-energy-is-useless.php
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https://legalinsurrection.com/2023/01/real-science-behind-reversal-of-gas-stove-ban/
From the study:
“We don’t want people to go out and completely ditch a perfectly good gas stove,” lead author Eric Lebel said.
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Who knew?
Quick question, what fuel do electric stoves burn?
"In 2021, coal-fired electric power plants accounted for 91% of West Virginia's total electricity net generation"
Ban natural gas. Replace it with coal. Or would this region not be part of a national ban?
https://www.eia.gov/state/?sid=WV
Broken record alert:. Build nuclear first. Then discuss the future of the declining need for fossil fuels. But no...
This isn't new.They banned incandescent bulbs before LED was ready so we installed tens of billions of mercury based cfl's, now in our landfills. All in the name of saving the environment.
How stupid can they be?
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https://www.foxnews.com/world/sweden-discovers-huge-deposits-rare-metals-potential-step-ending-europes-dependency-china?fbclid=IwAR0ccxmW2fSSwVPV_iUYQqdABdnD4Hjb-2B-djuae2PzMDFF9PgXgjs7P18
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https://www.nationandstate.com/2023/01/13/these-are-north-americas-biggest-sources-of-electricity-by-state-and-province/
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Good info.
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https://www.realclearpolicy.com/articles/2023/01/24/sunshine_might_be_free_but_solar_power_is_not_cheap_877463.html
No question he reads the forum.
Actual data from a southern state, solar panels are producing 22% of the time.
From the article:
"families and businesses are forced to pay for two electric systems: one that works when the sun is out, and one that works when it isn’t."
In their actual data, natural gas is only slightly cheaper than nuclear, and coal and solar are more expensive.
If you figure in any value for being carbon-free, there is no excuse for not building more nuclear.
Build more solar and you will have to use fossil fuels for the other 78% of the time. That is not carbon-free!
All that subsidies do is transfer and distort costs causing utilities to make the wrong choices. Choices that produce more carbon, not less.
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With Energy Deals in Africa, Italy Positions Itself as Europe's Next Gas Hub
The Italian government's new energy-driven approach to Africa will help the country bolster its own energy security and position itself as Europe's next natural gas hub. But infrastructural challenges at home and above-ground risks in North Africa will remain obstacles. The Italian government has made a series of high-level, energy-centric visits to the wider Mediterranean region since Italian Prime Minister Giorgia Meloni took office at the end of 2022. For example, Meloni visited Libya's capital Tripoli on Jan. 27-28 to discuss increased energy and migration cooperation with Abdul Hamid Dbeibah, the prime minister of Libya's internationally recognized Government of National Unity. While there, she oversaw the signing of an $8 billion natural gas deal between Italian oil and gas giant Eni and Libya's National Oil Corporation (NOC), and other deals for carbon capture and solar energy projects. Previously, Meloni visited Algeria's capital Algiers on Jan. 22-23 to meet with President Abdelmadjid Tebboune and Prime Minister Aymen Benabderrahmane, and she oversaw the signing of a new set of deals aimed at further strengthening bilateral economic and energy ties. During the visit, Eni and Algeria's state-owned Sonatrach signed a new set of deals aimed at further increasing Algeria's gas exports to Italy, reducing carbon emissions, and building a second pipeline connecting the two countries.
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https://thepostmillennial.com/south-africa-in-national-state-of-disaster-following-collapse-of-power-grid
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obviously (have on saracasm)
SA needs more windmills and solar panels:
then all will be beautiful! :wink:
while Bill Gates John Kerry buzz around the world in their luxurious jets
eating cavier and dom perignon
they sadly cannot stop over on Epstein island before the get to Europe to screw the rest of us over.
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https://oilprice.com/Energy/Energy-General/The-Fatal-Flaw-Of-The-Renewable-Revolution.html?fbclid=IwAR28_B2foQ5igyiQQooowg08vLpVpcF24v31f_P2skKlteFawvZZDNYp9Xw
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https://thepostmillennial.com/south-africa-in-national-state-of-disaster-following-collapse-of-power-grid
https://twitter.com/JackPosobiec/status/1625351214278877184
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insist on EV then have to import them from our arch enemy:
https://www.breitbart.com/politics/2023/02/14/ford-chinese-firm-plan-3-5b-electric-vehicle-battery-plant-in-michigan/
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insist on EV then have to import them from our arch enemy:
https://www.breitbart.com/politics/2023/02/14/ford-chinese-firm-plan-3-5b-electric-vehicle-battery-plant-in-michigan/
https://www.npr.org/sections/goatsandsoda/2023/02/01/1152893248/red-cobalt-congo-drc-mining-siddharth-kara
Be sure to put your "Black Lives Matter" bumper sticker on your EV, lefties.
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https://www.theepochtimes.com/biden-admin-proposes-to-block-half-of-current-gas-range-models_5083006.html?utm_source=Morningbrief&src_src=Morningbrief&utm_campaign=mb-2023-02-26&src_cmp=mb-2023-02-26&utm_medium=email&est=hTVvEtffD9T%2BAqqj4NveM%2BuMI2HlZ%2FSSP0N7VFJvyfcPWdcSkNl6v0DrBqikWKjvwMvX
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https://gizmodo.com/the-dubious-economic-calculus-behind-the-willow-project-1850236400
https://apnews.com/article/biden-climate-haaland-willow-alaska-oil-2ed1969b5a6e79bdbbae33f1049c8d41
the impact is trivial at best apparently
though Biden will be out there twisting it as some big nod to oil.
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where to dump old solar panels if not recycled:
https://www.bbc.com/news/science-environment-65602519
I suggest Brussels and Luxembourg and Palm Springs and Martha's Vineyard.
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https://manhattan.institute/article/electric-vehicles-for-everyone-the-impossible-dream
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https://discern.tv/oil-supply-is-on-the-brink-of-collapse-as-saudi-arabia-slashes-production/
I remember when a higher gas price was a bad thing for consumers. Now it's a national strategy and the world is joining in.
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America’s Rise as an Energy Export Powerhouse Hinges on One Town
Pipelines to Corpus Christi, Texas, are near capacity as U.S. oil production approaches records
About 2 million barrels of daily crude exports passed through Corpus Christi, Texas, in the first half of 2023, in addition to refined fuels.
About 2 million barrels of daily crude exports passed through Corpus Christi, Texas, in the first half of 2023, in addition to refined fuels.
By David UbertiFollow
and Benoît MorenneFollow
| Photographs by Verónica G. Cárdenas for The Wall Street Journal
July 21, 2023 5:30 am ET
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The U.S. has transformed global markets by boosting crude-oil exports more than 30-fold over the past decade. Much of the boom hinges on Corpus Christi Bay.
In the first four months of 2023, about half of the country’s 4.1 million barrels of daily shipments abroad was loaded onto skyscraper-size tankers from this stretch of Texas coastline, destined to become fuel for overseas travelers or factories.
Corpus Christi Bay
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That gusher of supply has helped blunt the increase in prices from recent production cuts by Saudi Arabia and Russia. In Europe, oil and natural gas shipped from the Gulf Coast have backstopped the continent as it weaned itself off Russian energy after the outbreak of the war on Ukraine.
Corpus Christi has become the dominant U.S. hub, siphoning crude from elsewhere thanks to unique terminals that make it cheaper than competitors. Now, ballooning trade from the port has put the U.S. on pace to pump out record oil exports this year, according to federal record-keepers.
But with pipelines nearing capacity and U.S. output set to reach new heights, competition is heating up among companies and investors over how to connect the American oil patch to a fuel-hungry world.
“The market is totally focused on taking shale production from the U.S. into international markets,” said Rusty Braziel, chief executive of consulting firm RBN Energy.
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Corpus Christi is the closest deep-draft port to the Permian Basin in West Texas and New Mexico, America’s hottest oil field. Crude extracted from shale rock there, prized by overseas refineries for its light, sweet quality, trades at a premium to many other grades.
A very large crude carrier seen from a boat in Ingleside, Texas, site of a former Naval base. Markings on the carrier help indicate how much of the vessel's hull is submerged.
That oil was confined stateside as the shale boom unleashed unprecedented U.S. production growth. But after Washington nixed decades-old export restrictions in 2015, companies scrambled to build out pipelines to Corpus Christi, a South Texas city of about 320,000.
Various companies have since constructed storage tanks in Corpus Christi to hold tens of millions more barrels of oil near the water. Cheniere Energy is expanding a plant that can liquefy natural gas for export. Since 2020, dredgers have been at work deepening the port’s ship channel and inner harbor to 54 feet from 47 feet currently, a more than $680 million operation that will allow many tankers to fill up close to capacity.
“You can’t just build those facilities overnight,” said Kent Britton, the Port of Corpus Christi’s interim chief executive.
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Ensuing growth in crude shipments has outpaced other launch points in Texas and Louisiana largely because of the economics of shipping. Exporters that operate from Houston-Galveston and the main Port of Corpus Christi funnel shipments to smaller classes of tankers, which either carry cargoes abroad or ferry them to 1,100-foot supertankers anchored offshore in a dayslong process.
But across Corpus Christi Bay, in the small town of Ingleside, Texas, oil terminals at a former Naval base are big enough that those massive ships can fill up about half of their 2 million barrels of capacity from shore.
“You can pretty much load your million barrels in 24 hours,” said Lois Zabrocky, chief executive of International Seaways, which operates 13 so-called very large crude carriers.
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Five tugboats then guide half-full VLCCs several miles out to sea, where smaller tankers top them off for delivery to refineries in Europe, Asia or elsewhere.
That streamlined loading process can pare the price of shipments compared with elsewhere on the Gulf Coast. Analysts said such differences became particularly crucial last year after Russia’s invasion of Ukraine whipsawed energy markets and sent shipping costs skyrocketing.
Calgary, Alberta-based Gibson Energy bought one of the Ingleside terminals in June for $1.1 billion, an investment that Chief Executive Steven Spaulding said will pay off regardless of whether Permian production growth continues. His rationale: Ingleside’s efficiency will entice traders, even if it means drawing oil away from across Corpus Christi Bay.
“It doesn’t matter to our terminal,” Spaulding said.
Pipelines from the Permian to Corpus Christi are running at about 90% capacity, according to East Daley Analytics, a level at which traders might begin sending more crude toward Houston for refining or shipment abroad.
The midstream energy company Enbridge has responded by announcing an expansion of its pipeline to Corpus Christi by 200,000 barrels a day. Other companies have proposed environmentally contentious plans for multibillion-dollar deepwater terminals that would allow VLCCs to load up fully in the Gulf of Mexico.
A liquid terminal in Ingleside, Texas, a port with capacity to accommodate supertankers.
For all their customers’ focus on oil-and-gas exports, Corpus officials are preparing for a future when the U.S. exports nonfossil-fuel commodities such as hydrogen and ammonia. The port authority applied to receive some of the $8 billion that Washington pledged in its 2021 infrastructure package to develop regional hubs aimed at accelerating the use of hydrogen for energy.
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Enbridge has said it would partner with the Norwegian fertilizer company Yara International to develop a plant to produce up to 1.4 million tons of ammonia a year at its Ingleside terminal. The companies plan to capture carbon dioxide produced during the process and store it underground—activity that could qualify for credits under President Biden’s climate law.
Corpus Christi “is hopefully the gift that’s going to keep on giving,” said Phil Anderson, senior vice president, business development, at Enbridge.
Write to David Uberti at david.uberti@wsj.com and Benoît Morenne at benoit.morenne@wsj.com
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$4 ($5?) gas for an election year and everyone knows whose fault it is.
The price of gasoline is starting to surge everywhere, an inflationary omen for central banks and governments the world over. Futures just soared to a nine-month high in New York, sending shock waves through to the pump, while prices have also been rising in Asia. Markets for the motor fuel have tightened worldwide due to a combination of unexpected refinery outages plus lower-than-normal stockpiles in key storage hubs such as the US Gulf Coast and Singapore for this time of the year. In global energy markets, it’s telling that while crude oil futures are little changed year-to-date, US gasoline contracts have rallied by more than 20%.
Bloomberg.com
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Are strategic reserves sit at a 40-year low because jackass had to remove millions of gallons to win the midterms. Now the price is too high again. Who knew this would happen?
https://justthenews.com/politics-policy/energy/report-biden-admin-cancels-oil-order-drained-strategic-petroleum-reserve?utm_source=mux&utm_medium=social&utm_campaign=tw
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:x :x :x :x :x :x :x :x :x
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https://www.foxnews.com/politics/energy-sec-granholm-secretly-consulted-top-ccp-energy-official-spr-releases
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https://www.telegraph.co.uk/news/2023/07/27/labour-cardiff-council-diesel-generators-electric-lorries/
"Labour council using diesel generators to charge electric bin lorries
Cardiff Council resorts to using portable diesel generators because of software problem causing new system to trip"
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They want to force all of us into electric vehicles, but we don't all have enough diesel generator capacity to pull it off.
(Doug) I keep trying to convert to Leftism but stubborn facts keep getting in the way.
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Ronald Reagan: The trouble with our Liberal friends is not that they're ignorant; it's just that they know so much that isn't so.
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I showed a three bedroom apartment to three men this week. When we got to the kitchen, one of them asked about switching the electric stove for a gas stove, and went on about how much he loves to cook (and prefers the gas stove).
Explained that it's hard to switch the hookups, and took the opportunity to say "they're going to take away your gas stove", a statement of both prediction and perhaps slight overstatement.
One of the others said back to me, "that's a republican lie".
Awkward moment for all and I dropped the subject there.
Then of course I looked into it. Where did that story originate? Oops, it looks like it started with a Biden appointee to the consumer products safety commission, reported by Bloomberg News.
https://www.bloomberg.com/news/articles/2023-01-09/us-safety-agency-to-consider-ban-on-gas-stoves-amid-health-fears
https://www.washingtonpost.com/business/2021/07/14/biden-nominates-trumka/
https://www.achrnews.com/articles/146993-gas-infrastructure-ban-takes-hold-in-berkeley
Sorry, but who is the Republican in this story? I don't see one, and the word "lie" is a little strong for having a different view of what is coming.
In context, that was the day the permanent ban on the sale of incandescent light bulbs went into effect. Not exactly an implausible prediction that they would ban other things they find harmful.
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https://www.washingtontimes.com/news/2023/aug/8/bidens-climate-change-agenda-adds-nuclear-mix-its-/?utm_source=Boomtrain&utm_medium=subscriber&utm_campaign=newsalert&utm_content=newsalert&utm_term=newsalert&bt_ee=4PAt3GmB%2FvwefQ%2BLublPX%2FWxqE0CjqSZH9DCnI7tNYTKYiUWg7n9IP1QHQJ1qLX%2F&bt_ts=1691523087252
OTOH:
https://www.nationalreview.com/news/biden-declares-national-monument-in-arizona-cuts-off-uranium-mining-on-one-million-acres/?utm_source=email&utm_medium=breaking&utm_campaign=newstrack&utm_term=32336429
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Electric bus maker files for bankruptcy two years after being praised by Biden
BY RAMSEY TOUCHBERRY THE WASHINGTON TIMES
The electric bus maker Proterra has filed for Chapter 11 bankruptcy, a little more than two years after the California-based public company received praise from President Biden for being the future of the EV industry.
Proterra said in a statement Monday that its bankruptcy was made “in an effort to strengthen its financial position through a recapitalization or going-concern sale.”
The company said it intends to continue normal operations through the process by using “existing capital to fund operations, including paying employee salaries and benefits, and compensating vendors and suppliers on a goforward basis.” “We have faced various market and macroeconomic headwinds that have impacted our ability to efficiently scale all of our opportunities simultaneously,” Proterra CEO Gareth Joyce said.
Its bankruptcy comes amid the auto industry grappling with widespread cuts and on the heels of EV startup Lordstown Motors filing for bankruptcy protection in June. Proterra, valued at $1.6 billion in January 2021, listed assets and liabilities at $500 million to $1 billion but saw its market value plummet to $362 million as of Monday’s market close. The company has made most of its money from manufacturing electric buses, but also produces EV parts like chargers and batteries for heavy-duty vehicles.
The Biden administration had close ties to the company, prompting criticism from conservatives about government spending on clean energy and the president’s climate agenda.
During a virtual tour of Proterra’s South Carolina facility in April 2021, Mr. Biden lauded Proterra for “getting us in the game” of green EV transportation. He predicted that Proterra and other EV companies would “end up owning the future.”
Energy Secretary Jennifer Granholm served on Proterra’s board of directors, and after conflict of interest criticisms once assuming her government role, sold her $1.6 million worth of shares in May 2021.
In February, Mr. Biden appointed Mr. Joyce to a national advisory committee on international trade called the President’s Export Council.
The company’s bankruptcy comes despite billions in funding and tax credits for electric buses through the Bipartisan Infrastructure Law and President Biden’s taxand- climate spending law known as the Inflation Reduction Act.
Mr. Biden still struck an upbeat tone Tuesday on his administration’s efforts to reduce emissions, which largely depends on remaking the transportation sector that is America’s second-largest source of emissions.
“All these historic measures put us on track to cut all American emissions in half — in half — by 2030, and we’re well on our way,” the president said during remarks in Arizona while unveiling a new national monument to protect the land from uranium mining. “There’s a lot of good that’s going to come from the sacrifices of dealing with taking on the climate crisis.”
Critics of Mr. Biden’s green energy agenda compared Proterra to Solyndra, the solar panel startup that received a more than $500 million loan under the Obama administration before going belly-up
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second
What Was Once a Weed Could Fuel Jet Engines
Scientists are developing nonfood plants to take the place of corn and soybeans as sources for biofuels
A crop called CoverCress, a source for biofuel that is aimed for cultivation on farms in harvest offseasons, was developed from a plant considered a weed.
A crop called CoverCress, a source for biofuel that is aimed for cultivation on farms in harvest offseasons, was developed from a plant considered a weed. COVERCRESS
By Yusuf KhanFollow
Aug. 9, 2023 10:50 am ET
Field pennycress, a plant in the Brassica family related to mustards and cabbages, is usually considered a weed. But one feature made it less of a wallflower: its very high oil content, about 50% higher than that of a soybean. After close to a decade of controlled breeding and gene-splicing, the onetime weed is being cultivated as a source for renewable diesel or sustainable aviation fuel.
Most biofuels in the U.S. currently come from corn or soybeans. But as demand for green fuels rises, global food shortages are also threatening. That’s bringing a push for low-carbon fuels that can be made without using edible grains—and spurring research on crops like field pennycress.
“Today the dominant feedstock oil source for [biofuels] would be soybeans, which creates this dynamic of, ‘Are we going to be using our soybean oil and our soybean meal for the fuel market vs. the food and feed markets?” says Mike DeCamp, the chief executive of CoverCress, the company that developed field pennycress. The plant, now also dubbed CoverCress, is aimed for cultivation on farms in harvest offseasons, as a so-called cover crop that can help prevent erosion and provide revenue when primary crops are fallow.
CoverCress is one of three nonfood cover crops that have received funding from the U.S. Department of Agriculture, where scientists have been hoping to find oilseed plants that could potentially produce renewable fuels without competing with food sources. The other two—Nuseed Carinata and a plant called camelina marketed by Global Clean Energy Holdings—are also oilseed crops that are grown during the winter fallow period.
Major oil companies have been getting on board. In 2022, BP agreed to buy Nuseed Carinata oil to process or sell as a supply of sustainable biofuels. Chemical and pharmaceutical giant Bayer expanded its stake in CoverCress to a 65% ownership share, with the remainder held by Chevron and agricultural trading house Bunge. Exxon Mobil has a multiyear agreement with Global Clean Energy Holdings to purchase renewable diesel made from camelina.
Growing these oilseed plants between main crop rotations on land already used for farming helps limit damage like deforestation, says Alex Clayton, global strategy and commercial lead for Nuseed Carinata.
Carinata, also known as Ethiopian Mustard, isn’t a weed like pennycress but also isn’t edible by humans. The crop, grown between November and May in the offseason for cotton and peanuts, is being tested by farmers in Alabama, Georgia and Florida, as well as in Argentina. The oilseed is crushed in Europe for use as a biofuel.
The companies behind these crops tout benefits to farmers, but convincing farmers to grow them can be a major hurdle.
“Farmers are very cautious, conservative and skeptical because they have heard a lot of promises that haven’t panned out,” says John Sedbrook, a professor of genetics at Illinois State University who is researching cover crops. “It has a lot of potential but there is a lot of work to be done.”
In most cases, farmers are contracted to grow the crops, with the companies determining when and how to use fertilizers as well as ensuring the plants are crushed and sent to the refiners. That loss of control, as well as overlaps of up to a month with cash crops that can delay planting can make these cover crops a tough sell.
Nuseed Carinata is grown in the offseason for crops such as cotton and peanuts. PHOTO: NUSEED
How the crops have been developed also can be an issue. In the U.S. growing GMO crops is legal, though regulated by groups like the U.S. Food and Drug Administration and the U.S. Environmental Protection Agency. However GMO crops are largely banned in the EU, which is a limitation for CoverCress. By contrast, Nuseed Carinata and camelina were developed mainly through selective breeding, rather than genetic modification.
Aviation is among the industries that are pushing demand for biofuels like those produced with cover crops. Sustainable aircraft fuel, or SAF, is still very much in its infancy. Output in 2021 was 100 million liters but in order for the industry to achieve net zero carbon output by 2050, around 449 billion liters will be needed, according to the Montreal-based International Air Transport Association. In 2022, 450,000 flights used SAF as a fuel source, the IATA estimates—just 1.5% of the flights that took place.
“We don’t have the solutions at scale today to actually solve the problem of decarbonizing how we fly,” says Lauren Riley, chief sustainability officer at United Airlines Holdings.
“If you think about some other markets, like ground transportation, they’re electrifying. They have batteries that are becoming more efficient and energy-dense with each generation. We don’t have sort of the equivalent of that for aviation.”
The new nonfood sources of biofuels are promising, she says. “Cover crops have the potential to take us to almost a carbon-neutral fuel which is exceptionally exciting.”
However, cover crops can only supply so much, says Hemant Mistry, director of energy transition at the International Air Transport Association. “A diversity [of sources] will be needed to ramp up SAF production going forward.”
“CoverCress, camelina and Carinata combined are not going to be the solution [alone],” says CoverCress CEO DeCamp. “It’s still not going to be enough oil to meet the demand based on the amount of capacity that’s coming online.”
“None of these crops are the magic bullet,” he says, “but they are part of a fabric that can really help in long-term lowering greenhouse gas emissions in the world.”
Write to Yusuf Khan at yusuf.khan@wsj.com
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third
Another Biden Speech in Need of Clarification
Limiting fuel for nuclear plants will not reduce emissions of greenhouse gas.
By
James Freeman
Follow
Aug. 8, 2023 7:16 pm ET
President Joe Biden has been known to get into trouble when he strays from his scripted remarks, but this doesn’t explain the confusion embedded in his Tuesday address in Arizona.
Chris Megerian and Terry Tang report for the Associated Press from Grand Canyon National Park:
Declaring it good “not only for Arizona but for the planet,” President Joe Biden on Tuesday signed a national monument designation for the greater Grand Canyon, turning the decades-long visions of Native American tribes and environmentalists into reality...
“Preserving these lands is good, not only for Arizona but for the planet,” said Biden, who spoke with a mountain vista behind him using a handheld mic to counter the wind and wearing a baseball cap and sunglasses to shield him from the sunshine...
The president tied the designation to his administration’s larger push to combat climate change and noted this summer’s extreme heat, which has been especially punishing in places like Phoenix. He said extreme heat was responsible for more deaths than other natural disasters like floods and hurricanes but added, “None of this need be inevitable.”
No, it doesn’t. And shielding oneself from the Arizona summer sunshine seems sensible enough. The confusion lies in the fact that the president is locking up nearly a million acres and the principal result is to limit potential uranium mining in the region. Uranium fuels nuclear power, a rare technology that can efficiently generate lots of energy while generating zero greenhouse-gas emissions. With this designation he’s just made it harder to meet his climate goals but seems to be under the impression that he’s done the opposite.
One might assume that the president decided to repeat his climate talking points at the wrong moment, or perhaps that a summer intern loaded the wrong speech into the teleprompter. But this seems to have been the White House plan all along—and this time Mr. Biden’s subordinates appear to be just as confused as he is.
On the Monday flight out to Arizona aboard Air Force One, White House press secretary Karine Jean-Pierre went with the same approach of presenting the administration’s new obstacle to zero-emission energy as some sort of climate initiative.
“President Biden continues to make combating the climate crisis a core tenet of his presidency,” said Ms.Jean-Pierre, who then introduced reporters to assistant to the president and national climate adviser Ali Zaidi. Ms. Jean-Pierrer said that Mr. Zaidi was “here to share more about the President’s climate agenda and the trip that we’re heading to.”
Here’s what he said, according to the White House transcript:
Great. As Karine said, the President has been focused on mounting an all-of-government response to the climate crisis. We see the impacts in our communities every single day. And the West, in particular, has been feeling the brunt of this, with heat waves blanketing communities, the skies turning orange.
But embedded in this crisis is also an opportunity for us to bring the country together, to advance our conservation agenda, and to spark a manufacturing renaissance here in the country. The President’s trip will demonstrate how he’s doing that.
Tomorrow, he will be announcing his fifth new national monument. It’s nearly 1 million acres. And folks know about the 300-million-year-old cliffs that line the Grand Canyon. What’s less known is the 300 cultural sites that make up this area. They tell a rich and important history. And it’s the reason why 12 tribes stepped up to request that this monument be declared. The President is going to take action to do just that.
What would we do without climate advisers who are also ready to share their expertise on rich cultural history? One can’t help but be reminded of the public health experts who momentarily abandoned their opposition to unmasked gatherings during the Covid panic in order to endorse leftist political protest.
Perhaps voters will be reassured that the alleged climate crisis can’t be that bad if even the president’s climate adviser recognizes other priorities. A reasonable conclusion is that “an all-of-government response” is hardly necessary if even the White House climate office doesn’t want to go overboard in the pursuit of emissions reductions.
But apparently the loss of potential uranium mining isn’t the only problem with the president’s action. In the Salt Lake Tribune Mark Eddington reports:
Chris Heaton, a Kanab City Council member and sixth-generation rancher who grazes his 200 head of cattle on roughly 48,000 acres he owns or leases on the Arizona Strip, is especially worried. He said the monument includes 1,000 acres of his private property...
“Ranchers have been using this land since we came here, and we have done a pretty dang good job of it,” Heaton said. “That’s why the [federal government] wants it, because they think they manage it better than we can.”
Heaton also called the notion that the national monument would protect indigenous people’s culture and sacred sites a smokescreen because the government will lure thousands of people to the region through advertising, which will result in the land being desecrated with graffiti and human waste.
***
Perhaps the White House climate office should take time off from its intensive study of cultural treasures to notice that outside of nuclear power, the zero-emission energy movement isn’t exactly thriving. The Journal’s Mari Novik and Jennifer Hiller report:
The wind business, viewed by governments as key to meeting climate targets and boosting electricity supplies, is facing a dangerous market squall.
After months of warnings about rising prices and logistical hiccups, developers and would-be buyers of wind power are scrapping contracts, putting off projects and postponing investment decisions. The setbacks are piling up for both onshore and offshore projects, but the latter’s problems are more acute.
In recent weeks, at least 10 offshore projects totaling around $33 billion in planned spending have been delayed or otherwise hit the doldrums across the U.S. and Europe.
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"build at least ten large reactors to meet an anticipated surge in demand for zero-carbon power."
(If Sweden needs at least 10 new large nuclear plants, how many do we need?)
Did we mention, carbon-free?
This is the answer to ccp's point, Republicans should address climate change. Whether or not you believe humans are the main cause in warming, we should be building the facilities to produce massive carbon-free, round the clock energy for our grid, and this is how you do it.
https://www.thetimes.co.uk/article/sweden-to-return-to-uranium-mining-climate-minister-says-9w8mhs7rq,
Besides mining their vast uranium resources, they are building piwer plants:
From the article:
"Nearly 40 years after the completion of the country’s last new nuclear power plant, Pourmokhtari has announced plans to build at least ten large reactors to meet an anticipated surge in demand for zero-carbon power.
***
“The government is aiming at doubling electricity production in 20 years,” Pourmokhtari said. “For our clean power system to function, a large part of this has to be dispatchable [i.e., reliable] where nuclear power is the only non-fossil option. Nuclear power also has a reduced environmental footprint and requires limited resources in comparison with most energy sources.”
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"his is the answer to ccp's point, Republicans should address climate change. Whether or not you believe humans are the main cause in warming, we should be building the facilities to produce massive carbon-free, round the clock energy for our grid, and this is how you do it."
yes
whether or not it is true ignoring it won't convince anyone
the LEFT has won the brain wash the public and particularly the younger generations we are the cause and it is a crises.
long time before we ever get fusion
or other physics based source of power.......
nuclear ok with me but LEFT has demonized this too.
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Agree 100% that the Rep cranky curmudgeon strategy is a loser!
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The Electric-Vehicle Bubble Starts to Deflate
Biden is imitating China just as its industrial policy starts to crack.
By
The Editorial Board
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Aug. 21, 2023 6:38 pm ET
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PHOTO: NICOLAS MAETERLINCK/ZUMA PRESS
It’s ironic, to say the least, that the U.S. is seeking to imitate China’s economic model at the moment that its industrial policy fractures. Look no further than its collapsing electric-vehicle bubble, which is a lesson in how industries built by government often also fail because of government.
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Tesla last week slashed its prices in China to boost sales in an oversaturated EV market. In July Tesla and other auto makers in China agreed to stop their EV price war, only to scrap the cease-fire days later owing to government antitrust concerns. While lower prices may benefit consumers, auto makers in China are bleeding red ink and going bust.
A plethora of Chinese EV start-ups launched in the past decade, fueled by government support, including consumer incentives and direct financing. Auto makers churned out EVs to suck up subsidies. Giant property developer Evergrande Group launched an EV unit as its real-estate empire began to implode, but now the EV unit is foundering too.
About 400 Chinese electric-car makers have failed in the past several years as Beijing reduced industry subsidies while ramping up production mandates. Scrap-yards around China are littered with EVs whose technology has become outdated, redolent of its unoccupied housing developments created by government-driven investment.
Beijing recently extended an EV sales-tax exemption to soften the industry’s problems. Auto makers are nonetheless having to slash prices to sell cars they are required to make, which is eroding margins. China’s EV mandate is similar to those imposed by California and the Biden Administration and especially punishes the West’s traditional fossil-fuel auto makers.
Volkswagen’s joint-venture in China this month announced up to $8,200 in incentives for its electric ID.6 X model. GM Chevrolet dealers in China are discounting EVs by more than 25%. Although EVs now make up a third of auto sales in China, supply still far exceeds demand. This gap will likely grow as Chinese consumption weakens.
As with real estate, Chinese government support inflated EV investment and misallocated capital that could have been put to more productive uses. Now comes the destruction that invariably follows the government creation, which may be a harbinger for the U.S. as the Biden Administration emulates China’s EV industrial policy.
Cox Automotive reported this month that EV inventory had swelled to 103 days of supply in the U.S., about double that of gas-powered cars. Auto makers and dealers are discounting EVs to sell their growing supply. The average EV price paid by consumers has fallen 20% compared with a year ago to $53,438, driven by Tesla’s price cuts and dealer incentives.
Ford recently reduced its EV production targets as its losses and unsold inventory grow. At the end of June, it had 116 days of unsold Mustang Mach-Es, and GM’s electric Hummer had more than 100 days of supply. And this is in a growing economy.
Traditional auto makers will have to raise prices on gas-powered cars to compensate for their EV losses. A United Auto Workers executive said Sunday that Stellantis is threatening to move production of its Ram 1500 trucks to Mexico from suburban Detroit, no doubt to reduce costs. The EV jobs President Biden touts will come at the cost of union jobs building gas-powered vehicles.
Meantime, EV start-ups are floundering as interest rates climb, and they struggle to scale up manufacturing. Lordstown Motors filed for bankruptcy in June. Nikola Corp. warned this year that it had “substantial doubts” about its ability to stay in business.
Business failures are inevitable in a dynamic economy, but government will be mainly responsible for the destruction that results from its force-fed EV transition—and the damage may only just be starting
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Lots of pages for me to read through.
I'll offer this rediculous link
https://www.un.org/sustainabledevelopment/sustainable-development-goals/
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Lots of pages for me to read through.
I'll offer this rediculous link
https://www.un.org/sustainabledevelopment/sustainable-development-goals/
No mention that the only way you would achieve any much less all of those objectives would be through a system of free enterprise, private property rights and capitalism, 3 things they abhor.
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Welcome back Peregrine!
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Shoring up his base. Selling out his country. Energy Independence is what we sought for decades. We found it. And we destroyed it. This policy hurts our exports, weekends our position in the world, elevates China, and does nothing to help the environment.
We want energy companies to make long-term investments, and then we do this:
https://www.nytimes.com/2023/09/06/climate/biden-drilling-alaska-wildlife-refuge.html
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I notice the other Doug, Burgun
has been airing commercials promising to do just that of late
get us back to energy independence
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25 Refrigerators per household. Since I don't use AC, the refrigerator is the biggest electricity user in the home. Now move transportation to the electric grid and see what happens. Crash.
https://internationalman.com/articles/3-reasons-theres-something-sinister-with-the-big-push-for-electric-vehicles/
(Paraphrasing)
1. It doesn't help the environment.
2. They don't compete without subsidies.
3. It is part of a much larger move to control you.
Number three is enough for me. Reasons one and two expose policy stupidity, but giving them more levers of control is sinister. Just say no.
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UK soon to be charging a daily fee for older vehicles
https://www.euronews.com/2023/08/30/londons-plan-to-charge-drivers-of-polluting-cars-sparks-protests-and-stirs-political-passi
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https://www.washingtontimes.com/news/2023/sep/12/us-pace-record-oil-production-despite-bidens-green/?utm_source=Boomtrain&utm_medium=subscriber&utm_campaign=newsalert&utm_content=newsalert&utm_term=newsalert&bt_ee=eY7%2F3tVGd6cN8swYVNDhagv31BTR%2BLe3w8Xe87Ml0TYAQ2zHo7wHkG2IXq2iegDK&bt_ts=1694547265244
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IIRC we posted something a ways back about the Biden Admin fukking with this- see the line herein about in withdrawing support in Jan '22:
=============================
September 15, 2023
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The Turkish-Israeli Gas Pipeline Is Dead in the Water
Regional disputes and rival plans could deal another blow to Turkey’s dream of becoming an energy hub.
By: Caroline D. Rose
A partial solution to Europe’s energy crisis can be found off the coast of Israel, roughly a mile beneath the surface of the Mediterranean Sea. Now they just need a cheaper way to transport it.
For more than a year, Turkish and Israeli officials have shuffled between each other’s capitals, hinting at a potential energy corridor linking the Leviathan offshore gas field to Europe. Plans for a pipeline have been around for years but were re-energized in the wake of Russia’s invasion of Ukraine, as the European Union sought to replace the 40 percent of its gas supplies that came from Russia. But while it would be much cheaper than rival projects (such as the EastMed pipeline), regional politics, unpredictable market demand and emerging alternatives mean the Turkish-backed pipeline is unlikely to be built.
Proposed Israel-Turkey Gas Pipeline
(click to enlarge)
Investors, industrialists and government officials have been working up proposals to move natural gas from Israel’s Leviathan field to consumers in Europe since the field’s discovery more than a decade ago. A previous plan, the EastMed pipeline, broke down over its hefty $6 billion price tag, sharp criticism from Turkey over its exclusion, and finally the Biden administration’s January 2022 decision to withdraw U.S. support. A short time later, Ankara pitched its much cheaper alternative: a $1.5 billion, 500-kilometer (310-mile) route from Leviathan to Turkey, which dreams of becoming a regional gas hub.
The first challenge was that Israel and Turkey were hardly on speaking terms. The regional rivals have deep-seated differences over energy exploration in the Mediterranean, the Cyprus conflict and the Israeli-Palestinian issue. In February 2022, a high-level Turkish delegation visited Israel to break the ice, framing energy cooperation as key to further political, economic and security collaboration after years of strained relations. The following month, Israel’s president trekked to Ankara – the first state visit to Turkey by a high-ranking Israeli official in a decade – where the pipeline was discussed. Turkey’s foreign minister traveled to Jerusalem in May to continue the conversation, and by August the two sides had agreed to restore diplomatic relations.
Both sides gave ground to reach this point. When Israeli security forces clashed with Palestinian protesters at the Al-Aqsa Mosque last spring, the Turkish government refrained from criticism – something that would have been unthinkable not long ago. Similarly, Israel went quiet on the Eastern Mediterranean Gas Forum, the regional bloc that pushed the EastMed pipeline, indicating greater interest in alternative energy projects. Amid intensifying great-power competition, it is in both countries’ interest to patch things up with old foes for the benefit of foreign policy flexibility.
However, a subsea pipeline through multiple countries’ exclusive economic zones is still a major undertaking. Facing uncertain demand dynamics, intricate regional politics and new challengers, the Israeli-Turkish pipeline is likely dead in the water.
First, the pipeline would cross Cyprus’ EEZ, touching on a sore spot for Mediterranean stakeholders. Since 1974, the island of Cyprus has been split between a Greek Cypriot south and a Turkish-occupied north. The Turkish government does not recognize the Greek Cypriot government, whose approval would be required before starting construction within its EEZ. Additionally, the main backer of the Greek Cypriot government, Greece, has its own ambitions to become a bigger transit state for gas to Europe and would not want to see its rivals in Turkey strengthened. Greece, Cyprus and Israel are all members of the Eastern Mediterranean Gas Forum, and they frequently conduct military exercises together, so it is unlikely that Israel would proceed with the pipeline project without their support.
Similar issues could arise with Syria, whose EEZ the pipeline would also likely traverse. After Iran, Israel considers Syria to be one of its greatest regional foes. In addition to decades of bad blood and territorial disputes, the Assad government has recently unnerved the Israelis by staging Iran-aligned militias and Hezbollah fighters along their shared border. Turkey flirted with normalizing relations with the Assad regime, particularly after the February 2023 earthquake that devastated northern Syria and southern Turkey, but it held back because of disagreements over the status of northwest Syria and the repatriation of Syrian refugees, among other things. Trying to gain Syria’s consent for a pipeline through its EEZ would be fraught for Turkey, but for Israel it’s a nonstarter.
Finally, an alternative project may be taking shape in the form of the India-Middle East-Europe Economic Corridor, which includes Israel but not Turkey. Consisting of railways, ports, electricity and data links, and even infrastructure to make and ship green hydrogen, the IMEC is a formidable rival. It also enjoys the support of India, the U.S., the EU and the Arab Gulf states. Although Israel did not sign the memorandum of understanding outlining plans for the IMEC, Prime Minister Benjamin Netanyahu voiced support for the deal, indicating potential interest not only in participating in the corridor but also in using it to build on normalization efforts with the Arab Gulf states. Such a gargantuan undertaking will be hard to get off the ground, but if it includes Israel, it would make plans for a pipeline with Turkey redundant.
Proposed India-Middle East-Europe Economic Corridor
(click to enlarge)
An Israeli-Turkish energy corridor to Europe makes sense on paper. It would satisfy Europe’s need for alternative gas suppliers, Turkey’s quest to become an energy hub and Israeli efforts to improve and diversify relations in the Middle East. However, given the issues with Cyprus and Syria, not to mention the IMEC proposal, Turkey will probably soon be its lone proponent.
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I wondered about that too
thinking we must be sending it overseas
recently Kudlow had guest who explained we are sending overseas - to Europe
we blow up Nordstream then send them our oil :-o
can we blow up Saudi oil and fill in the gap? Just kidding
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Just what the Democrats promised. Actually $8/gallon:
https://www.latimes.com/archives/la-xpm-2008-jul-11-oe-stein11-story.html
https://www.cbsnews.com/losangeles/news/gas-prices-continue-to-steadily-increase-in-la-county/
Why aren't working Americans celebrating this? It's what too many of you voted for.
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https://www.washingtontimes.com/news/2023/sep/26/us-strategic-oil-reserve-lowest-level-decades-even/?utm_source=Boomtrain&utm_medium=subscriber&utm_campaign=newsalert&utm_content=newsalert&utm_term=newsalert&bt_ee=9Isr5f8Z3ZTz8YfkVvNQo2LTh4bKuh1SSnQvtNjxwXCBci1DKEc3uCe%2BO32r2KY4&bt_ts=1695896521630
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https://justthenews.com/politics-policy/energy/biden-administration-places-restrictions-gas-powered-furnaces-says-it-will
In the 4 million person Twin Cities area roughly 100% use clean natural gas to heat their homes.
If you switch to electric, the number one source of that electricity is, um, natural gas, in our state and in the nation.
Put transportation and heat on the grid and two things happen, nearly all of the increase needs to come from natural gas, and, guess what, OUTAGES, always atvthe very worst time.
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As with most things where our government betters place their thumbs on the scale, perverse incentives, unanticipated outcomes, and deals with various devils are all part of the package:
https://www.americanthinker.com/articles/2023/08/modern_energy_and_your_turbine_footprint.html?fbclid=IwAR1Px97M4Oly8IaPID1UNLi2TdZRpSuwuq9st-uE143CPnhCYzkWHoHvej8
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2nd post.
Investors are realizing “green” energy returns few greenbacks.
https://joannenova.com.au/2023/10/investors-are-starting-to-run-from-clean-green-energy/?utm_source=rss&utm_medium=rss&utm_campaign=investors-are-starting-to-run-from-clean-green-energy
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Renewables don't fare all that well:
https://wattsupwiththat.com/2023/10/13/extraordinary-costs-of-green-energy-creeping-slowly-into-public-awareness/?utm_source=feedly&utm_medium=rss&utm_campaign=extraordinary-costs-of-green-energy-creeping-slowly-into-public-awareness
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Recent elections don’t go well for Greens, open border advocates, etc. Several parallels with American politics; does this result bode something similar in ‘24?
https://hotair.com/tree-hugging-sister/2023/10/13/european-elections-ashes-ashes-the-greens-fall-down-n584628?fbclid=IwAR2ycI6t-1PLnJ_gPuTZhXTnVDjaiIHYWqnrp9zYu0D_U8GnzT5JJjw5dng
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3rd post. Michael Kelly does the math:
https://wattsupwiththat.com/2023/10/13/michael-kelly-the-green-energy-net-zero-plan-will-require-a-command-economy/?utm_source=rss&utm_medium=rss&utm_campaign=michael-kelly-the-green-energy-net-zero-plan-will-require-a-command-economy
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Completely true but I suspect it is backwards. The command economy and poverty purveyors have latched onto the net zero strategy. From their own behavior, it's clear they don't care about carbon.
A climate researcher last week claimed he lost his job for not being willing to (jet) travel.
https://www.independent.co.uk/climate-change/news/scientist-fired-refuse-fly-gianluca-grimalda-b2428809.html
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I don't see a problem
if net cost only over 35 trillion
just ask Paul Krugman.
so our debt goes to 70 trill.
he told us world is "awash in cash"
if Krugman is not fake news, I don't know what is ! :x
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BBG: That Net Zero piece by Kelly is very strong.
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Completely true but I suspect it is backwards. The command economy and poverty purveyors have latched onto the net zero strategy. From their own behavior, it's clear they don't care about carbon.
A climate researcher last week claimed he lost his job for not being willing to (jet) travel.
https://www.independent.co.uk/climate-change/news/scientist-fired-refuse-fly-gianluca-grimalda-b2428809.html
\
Utterly par for the course where the Davos jet set types are concerned, with the irony considered irrelevant as they are either one of Gaia’s chosen or in on the scam and hence don’t give a damn about the carbon fetish in the first place.
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https://heartland.org/opinion/without-crude-oil-there-can-be-no-electricity/
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An exploration of the amount of space a given energy needs to create its power, and the implications thereof. Hint: "green" energy sources require a lot more space to be devoted to energy production:
https://the-pipeline.org/saving-the-planet-only-to-despoil-it/?fbclid=IwAR1jjqKtrYfbg7-pNYuGYzjvnu4Jcv-ZOR8_xwP-Wm2WmXoQ_FUxOP6Bev0
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A powerful point pithily made-- I had not thought to express things in this way.
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A powerful point pithily made-- I had not thought to express things in this way.
Well hey, who needs pastures and agricultural fields when we can instead convert it into alcohol, solar, and wind farms?
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… and we get to choose:
https://wattsupwiththat.com/2023/10/24/aussie-climate-minister-dont-expect-3-2gw-of-new-renewable-capacity-to-stop-blackouts/?utm_source=rss&utm_medium=rss&utm_campaign=aussie-climate-minister-dont-expect-3-2gw-of-new-renewable-capacity-to-stop-blackouts
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https://oilprice.com/Latest-Energy-News/World-News/Oil-Refiners-Struggle-To-Access-Financing-As-Banks-Shun-Fossil-Fuel-Projects.html
Energy independence was once a dream. Then a reality. Now it's in the rear view mirror.
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An exploration of the amount of space a given energy needs to create its power, and the implications thereof. Hint: "green" energy sources require a lot more space to be devoted to energy production:
https://the-pipeline.org/saving-the-planet-only-to-despoil-it/?fbclid=IwAR1jjqKtrYfbg7-pNYuGYzjvnu4Jcv-ZOR8_xwP-Wm2WmXoQ_FUxOP6Bev0
Nuclear energy uses the least amount of land.
https://ourworldindata.org/land-use-per-energy-source
Leaving the most available for other uses, like living and growing food.
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Various players are bailing on “green energy.”
https://the-pipeline.org/green-investors-seeing-red/?fbclid=IwAR1s5XDy81Y_zlic0fwJbJrSHpB-bk8hzAeI0iQZucLoB5ZXvI8w8yA2YRE
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2nd post. Once subsidies are are accounted for EVs are far more costly to fuel than generally reported:
https://www.thecentersquare.com/national/article_a609f8aa-7443-11ee-83d3-df5b22909078.html
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When I went to buy my Ford Maverick pick up truck, the base model was a hybrid. In addition to my general aversion to EV, it lacked the balls to tow so it was an easy call to make one step up in price and get an all gasoline engine that had the balls to tow as well. SO glad I went this route!
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When I went to buy my Ford Maverick pick up truck, the base model was a hybrid. In addition to my general aversion to EV, it lacked the balls to tow so it was an easy call to make one step up in price and get an all gasoline engine that had the balls to tow as well. SO glad I went this route!
Yes. A choice. Not a mandate.
One point in favor of hybrids, regenerative braking is a great thing, partially offsetting the energy of acceleration. But hybrids aren't for everyone or every situation. For one thing, they aren't supposed to sit still long. Aren't we supposed to be able to leave our car in the garage and drive less? And there eventually is battery replacement.
Does anyone remember the whole SUV craze started in response to government CAFE mandates, corporate average fuel economy mandates that forced auto manufacturers out of the big family station wagons people wanted so they shifted from 'passenger cars' to 'light trucks', a different standard, that just happen to now have cruise, leather, power everything and feel like a luxury car. How much gas did we save with THAT.
And then there is this:
Study: Cost of ‘fueling’ an electric vehicle is equivalent to $17.33 per gallon
https://www.kpvi.com/news/national_news/study-cost-of-fueling-an-electric-vehicle-is-equivalent-to-17-33-per-gallon/article_caff6214-815b-5a60-b54d-8e13d5989458.html
"costs born by taxpayers for subsidies, utility ratepayers for energy investments, and non-electric vehicle owners for mandate-and-environmental-credit-driven higher vehicle costs, which they say total $48,698 per EV."
(Doug) Let's see, you need oil to mine the materials, you need oil to manufacture the car, to ship, to service, to power the grid, to make the tires, and so on. Otherwise they use no fossil fuels!
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FWIW I am not a believer in regenerative braking due to my wife's experience with her Toyota Highlander. When it is time to do , , , whatever the hell the equivalent is of putting in new brake pads, it is SUPER expensive.
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wind energy becoming expensive :
https://www.msn.com/en-us/money/markets/the-case-for-wind-power-was-built-upon-a-falsehood/ar-AA1j29KS?ocid=msedgntphdr&cvid=4c2c53c2f6f040cf98c3422e3f8c162f&ei=47
we need a Republican to blow this up
since MSM will not.
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https://thefederalistpapers.org/opinion/electric-bus-loses-power-going-hill-rolls-backward-crashes-line-cars
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Best Way to Extinguish a Flaming Electric Vehicle?
News you can use.
WSJ: Stand back and watch it burn.
https://www.wsj.com/business/autos/best-way-to-extinguish-a-flaming-electric-vehicle-let-it-burn-f1fa2b53?st=77rc3w4g3k448l6
But let's all get one. Taxpayers will pay you to get one. Even if you're a billionaire.
Software controlled car, government loves the shutoff switch.
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These and other facts and insights from Mark Mills at George Gilder's 2023 COSM event:
US is spending $2 trillion in the mis-named Inflation Reduction Act to reduce CO2 emissions by 1 Gigaton/yr.
During that time, China will INCREASE its CO2 emissions with new coal plants by 2 Gigatons/yr.
Net save-the-climate gain: worse than zero.
Meanwhile, China will have a huge cost advantage on the production of everything else because of much cheaper energy.
China produces over 60% of the world’s aluminum, refines over half of the world’s copper—the element that is the keystone of 90% of all things electrical—and 90% of the world’s refined rare earth elements vital for many electric motors or generators, and irreplaceable in many high-tech applications including solar cells and wind generators, 90% of the globes refined gallium, the element that makes possible the magical semiconductor gallium-arsenide used to make many tech things, not least lasers and LEDs; and 60% of the world’s refined lithium, 80% of the world’s refined graphite that is used in all lithium batteries, and 50% to 90% of many key chemical formulations and polymer parts needed to fabricate lithium batteries.
----------------------------------------------------------------------------------------
Two decades and $5 Trillion spent on solar and wind energy to reduce fossil fuels. That spending "decreased the share of energy supplied by hydrocarbons by just two percentage points. Today hydrocarbons still supply 82% of global energy. And the combined contribution from solar and wind hardware today supplies under 4% of global energy. For context: burning wood still supplies 10% of global energy. Meanwhile, the absolute quantity, not share, of hydrocarbons consumed by the world over the past two decades has increased by an amount, in energy-equivalent terms, to adding six Saudi Arabia’s worth of oil output."
-----------------------------------------------------------------------------------------
Jevons Paradox: Efficiency gains don’t slow energy demand growth, it propels it.
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DO NOT CLICK ON THE POWERCOSM LINK. SUPER BAD JUJU.
CINDY AND OUR WEBMASTER BOB ARE WORKING TO VERIFY WHAT THE F!!!
Doug, you have email.
----------------
Cindy just told me she was able to get Norton running now, but until the situation clafifies I am using my laptop instead.
Stay tuned!
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https://www.msn.com/en-us/money/markets/the-law-that-will-change-the-way-millions-of-americans-get-their-power-it-s-a-big-deal/ar-AA1d0ibh?ocid=msedgntp&pc=DCTS&cvid=5c16d48e169f454492512a3ebbd12c48&ei=12
gotta love this nonsense
"Rural energy is getting a long overdue makeover. Thanks to the Inflation Reduction Act, the government has earmarked $10.7 billion to help make energy cleaner and more affordable for 42 million people across the country, as Canary Media reported."
Here is the new propaganda site (probably got seed money from Gates etc.)
https://www.msn.com/en-us/news/us/the-cool-down-new-website-aims-to-be-the-first-mainstream-climate-change-brand/ar-AA14B19Y
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US burning less coal. China is burning more coal . Perspective is shown in a graphic:
https://www.powerlineblog.com/ed-assets/2023/11/Screenshot-2023-11-17-at-1.41.27%E2%80%AFPM-1536x922.png
Odd but true, the more we spend on clean energy, the dirtier the planet gets.
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… are forced to confront some inconvenient truths:
https://www.samizdata.net/2023/11/climate-fatigue/
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https://dailytelegraph.co.nz/opinion/the-green-scam-how-electric-vehicles-harm-the-environment-that-theyre-supposed-to-save/
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Putting this in energy topic as well.
https://youtu.be/uJAcywyx0ZA?si=efmv5cr-L_EKArL5
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Famous people caught reading the forum:
https://www.powermag.com/22-countries-including-u-s-pledge-to-triple-nuclear-power-capacity/
It's about bleeping time.
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Think this gent has called these tools out by their true name:
https://www.spiked-online.com/2023/12/04/revenge-of-the-feudalists/?fbclid=IwAR0G7EXPN4DNZeSHX225T_MgQ34b78CH7RQMRN5Dh3PvBO1qbJBFbiscm8I
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BBG:
interesting stuff on the author of the article:
https://en.wikipedia.org/wiki/Brendan_O%27Neill_(columnist)
" Once a Trotskyist, O'Neill was formerly a member of the Revolutionary Communist Party and wrote for the party's journal Living Marxism. In 2019, O'Neill said he was a Marxist libertarian.[2][3]"
What in the world is a marxist liberterian ? Is that not like saying I am a man and woman at the same time?
" In 2020, in relation to COVID-19, he has argued that "this pandemic has shown us what life would be like if environmentalists got their way"[35][36] and condemned the "chilling" and "dangerous" "witch-hunting of those who criticise the response to coronavirus".[37] "
" He criticised the Swedish environmentalist activist Greta Thunberg in his 2019 article "The Cult of Greta Thunberg"[26] in which he describes her as a "millenarian weirdo" and criticises what he describes as the "monotone voice" speech patterns[27][28][29][30] of the Swedish environmentalist. O'Neill has described warnings concerning overpopulation as a "Malthusian" interference in a women's right to reproductive freedom.[31]"
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"What in the world is a marxist libertarian?"
- Just for the record, there isn't any system where the pursuit of equal outcomes happens without authoritarian coercion.
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comes up on search
anti capitalist & centralized control
and workers in groups have common ownership
https://en.wikipedia.org/wiki/Libertarian_socialism
https://en.wikipedia.org/wiki/Anarchism
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BBG:
interesting stuff on the author of the article:
https://en.wikipedia.org/wiki/Brendan_O%27Neill_(columnist)
" Once a Trotskyist, O'Neill was formerly a member of the Revolutionary Communist Party and wrote for the party's journal Living Marxism. In 2019, O'Neill said he was a Marxist libertarian.[2][3]"
What in the world is a marxist liberterian ? Is that not like saying I am a man and woman at the same time?
" In 2020, in relation to COVID-19, he has argued that "this pandemic has shown us what life would be like if environmentalists got their way"[35][36] and condemned the "chilling" and "dangerous" "witch-hunting of those who criticise the response to coronavirus".[37] "
" He criticised the Swedish environmentalist activist Greta Thunberg in his 2019 article "The Cult of Greta Thunberg"[26] in which he describes her as a "millenarian weirdo" and criticises what he describes as the "monotone voice" speech patterns[27][28][29][30] of the Swedish environmentalist. O'Neill has described warnings concerning overpopulation as a "Malthusian" interference in a women's right to reproductive freedom.[31]"
What can I say, I'm fond of eclectic, heterodox sources that like to stir things up. I note spiked's "about" page states:
spiked is the magazine that wants to change the world as well as report on it. Edited by Tom Slater, and launched in 2001, it is irreverent where others conform, questioning where others wallow in received wisdom, and radical where others cling to the status quo.
At a time when it is fashionable to cancel ‘problematic’ people, to sideline voters when they give the ‘wrong’ answer, and to treat human beings as a drain on the planet, we put the case for human endeavour, the expansion of democracy, and freedom of speech with no ifs or buts.
Our motto is ‘question everything’ – or as the New York Times put it, we are ‘the often-biting British publication fond of puncturing all manner of ideological balloons’.
You can read new articles and essays on spiked every day of the week. Also be sure to check out our suite of podcasts, subscribe to our YouTube channel, sign up to our daily and weekly newsletters, and follow us on Facebook and Twitter.
****
I can more than endure many of those sentiments.
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I don't disagree with much of what was written, but I also like to know more about an author.
He *was* a Trotsky or Marxist-libertarian. I think I understand what that is after reading it.
What I do not see in Wikipedia is how he would describe his political beliefs NOW.
Not clear to me since he seems to have both liberal and conservative views. Maybe middle of the road on LEFT RIGHT spectrum?
just curious
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I don't disagree with much of what was written, but I also like to know more about an author.
He *was* a Trotsky or Marxist-libertarian. I think I understand what that is after reading it.
What I do not see in Wikipedia is how he would describe his political beliefs NOW.
Not clear to me since he seems to have both liberal and conservative views. Maybe middle of the road on LEFT RIGHT spectrum?
just curious
My guess is he likes shining folks on—I’m an imperial republicrat myself—though that guess is based on my own warped tendencies and the contradictions in terms already mulled.
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Got your daily dose of cognitive dissonance, fortunately of the good kind. Green energy conference morphs into fossil fuel trade show:
https://www.cfact.org/2023/12/07/cop-28-is-a-really-big-fossil-fuel-trade-show/?fbclid=IwAR39EZJJms7Yxlcr4HvYGm6Hji6eqO0pmWi99p5bEMYbXcBq8vP7knE0fSY
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"Green energy conference morphs into fossil fuel trade show"
:-D :-D :-D
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https://nordictimes.com/the-nordics/norway/electric-buses-could-not-withstand-the-cold-in-oslo/
Minneapolis is colder in January than Oslo.
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:-D Or that’s one way of looking at it.
Another is when the Biden admin has to chose between green energy and bowing before the union, they make the more obsequious choice.
https://wattsupwiththat.com/2023/12/15/100-year-old-union-backed-law-among-snags-derailing-bidens-green-energy-agenda/?fbclid=IwAR2Ifg_XBajR-UudMA0kZIzOK079JJLMIvU2bl2Y8DFdhfxnbAnDiSi-0zY
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I am looking at these things and wondering how long they will last before they fall apart.
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As David Gordon would say "Prepare to have (y)our assumptions shattered!"
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The Greenies run their mouths about those rotten hydrocarbons, and do whatever they can to increase the cost of their use, but if they were succeeding coal use would be diminishing rather than rising. At the end of the day the ones they impact the most are the poorest among us. Their mothers must be proud:
https://joannenova.com.au/2023/12/more-coal-burned-on-earth-in-2023-than-ever-before-in-human-history/?utm_source=rss&utm_medium=rss&utm_campaign=more-coal-burned-on-earth-in-2023-than-ever-before-in-human-history :-D
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PENNSYLVANIA
Driller set to frack again after ban over alleged pollution of water supply
BY MICHAEL RUBINKAM ASSOCIATED PRESS
A year after pleading no contest to criminal charges, one of Pennsylvania’s leading natural gas companies is poised to drill and frack in the rural community where it was banned for a dozen years for polluting the water supply.
Coterra Energy Inc. has won permission from state environmental regulators to drill 11 gas wells underneath Dimock Township, in the state’s northeastern corner — the sweet spot of the largest natural gas field in the United States, according to well permit records reviewed by The Associated Press.
Billions of dollars’ worth of natural gas, now locked in shale rock deep underground, awaits Coterra’s drilling rigs.
Some landowners, long shut out of royalties because of the state’s lengthy moratorium, can’t wait for the Houston-based drilling giant to resume production in Dimock. Other residents dread the industry’s return. They worry about truck traffic, noise and the threat of new contamination.
Coterra has not set a date for the resumption of drilling. A company spokesperson, George Stark, said “Coterra is committed to safe and responsible operations wherever we work.” Under its deal with the state, the driller agreed to monitor drinking water supplies within 3,000 feet of the new gas wells and take other steps designed to mitigate risk.
Dimock, a tiny crossroads 15 miles south of the New York state line in northeastern Pennsylvania, became ground zero in a national debate over fracking — the extraction technique that spurred a boom in U.S. oil and gas drilling — after residents began reporting that methane and drilling chemicals in the water were making them sick.
A state investigation concluded that faulty gas wells drilled by Coterra’s corporate predecessor, Cabot Oil & Gas, had allowed methane to leak uncontrolled into the community’s aquifer. Cabot was banned from Dimock in 2010 after regulators accused the company of failing to keep its promise to restore or replace the water supply.
An Emmy Award-winning documentary, “Gasland,” showed residents lighting their tap water on fire.
After years of litigation and a grand jury inquiry that resulted in criminal charges, the company pleaded no contest to a misdemeanor count Nov. 29, 2022.
Under a plea agreement, Coterra agreed to foot the bill for a $16 million public water system to supply 20 homes whose water wells had been damaged, and to pay for temporary treatment systems for those who want them.
But for some residents, elation about the water line turned to anger when they learned the Department of Environmental Protection had quietly lifted its long-term moratorium on gas production in Dimock. State officials have denied that Coterra pleaded no contest in exchange for being allowed to drill, but residents such as Victoria Switzer said they felt deceived.
“I have seen how justice played out here, and it’s not justice,” said Ms. Switzer, whose well was among those found to be contaminated, and who has not had a drink from her kitchen faucet since 2009.
Coterra remains prohibited from drilling inside the 9-squaremile moratorium area itself. The company plans to start the wells outside of Dimock and drill horizontally underneath the community. Some of the planned wells will be nearly 5 miles long and well over a mile deep, snaking under the land of more than 80 individual property owners, according to permit records.
The landowners are sitting on a gas gusher. Dimock’s natural gas could be worth $2.5 billion to $3.8 billion, according to Terry Engelder, a retired Penn State geologist whose 2008 calculation of enormous reserves in the vast Marcellus Shale natural gas field helped spur a drilling frenzy in Pennsylvania.
The area’s state representative, Jonathan Fritz, said an overwhelming number of his constituents favor natural gas drilling, an important economic engine in a county where farming, logging and bluestone quarrying were primary industries.
A Coterra subsidiary is the No. 1 employer in Susquehanna County, a mountainous region with a population of 38,000.
“Natural gas development has been a godsend,” Mr. Fritz said. The residents of Dimock, he said, “were harmed, they did realize a hardship, but I believe they have been made whole.”
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https://twitchy.com/dougp/2023/12/27/biden-and-dems-spent-75-billion-on-ev-chargers-2-years-ago-and-how-many-have-been-built-so-far-n2391191
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This piece explores how the energy needs of emerging nations combined with Russia and China's utter disregard for sky-is-falling predictions and the edicts that are then spun off effectively kill the sundry agreements based on catastrophic claims:
https://archive.ph/8AZCl
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Wait, they are costly, expensive to maintain, take too long to charge (assuming you can find a charging station), and customers don't want to drive them? Who knew...?
https://legalinsurrection.com/2024/01/hertz-selling-20000-electric-vehicles-for-gas-powered-cars/?utm_source=feedly&utm_medium=rss&utm_campaign=hertz-selling-20000-electric-vehicles-for-gas-powered-cars
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and cost LOTS more to fix after accidents.
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Wait, they are costly, expensive to maintain, take too long to charge (assuming you can find a charging station), and customers don't want to drive them? Who knew...?
and cost LOTS more to fix after accidents.
Apparently, with higher insurance rates, they cost more to fix even if you never have an accident.
https://www.nerdwallet.com/article/insurance/tesla-insurance
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Lookie here, left wing org sponsors conferences, symposia, and such judges are brought to to “learn” about environmental issues:
https://the-pipeline.org/indoctrinating-judges-on-climate-change/?fbclid=IwAR3vhO0uZw-YrDnY7qUlM0N_Pr3quXunaeqgM3S0oN47kPTOK6YMis5JyMU
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https://www.eli.org/law-environmental-protection
Don't see George or son Michael Soros names identified on their website .... :-P
from their website on the Chevron vs. Fisherman case before SCOTUS.
My understanding is this is a big deal that will affect the power of bureaucracies vs legislatures.
(if I understand it correctly)
Indications are thus that the deciding votes will be up to Barrett and Roberts.
Of course the leftists on the Court want to keep it and maintain the bureaucrats power (especially most bureaucrats are libs)
while Alito, Thomas, Kavanaugh, and Gorsuch seem to want to limit the doctrine or reverse it and Barrett and Roberts appear the wild cards on the fence.
Justice Kagan worries about a reversal of the doctrine will open up the floodgates of anti-bureaucracy lawsuits but OTOH I am thinking without this check unelected bureaucrats are almost free to do as they please.
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… to billionaire busybodies:
https://joannenova.com.au/2024/01/wef-say-worlds-greatest-threat-is-misinformation-the-biggest-threat-to-experts-and-billionaires-is-free-speech/?utm_source=rss&utm_medium=rss&utm_campaign=wef-say-worlds-greatest-threat-is-misinformation-the-biggest-threat-to-experts-and-billionaires-is-free-speech
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That might have fit better in the Globalism thread :-D
Hope I'm not getting on your nerves with his; I do realize we have a ton of threads but I do believe that some discipline in thread coherency really helps this forum be a resource for finding our way through the flotsam of cyberspace and the Controligarchs' efforts to manipulate how we think.
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That might have fit better in the Globalism thread :-D
Hope I'm not getting on your nerves with his; I do realize we have a ton of threads but I do believe that some discipline in thread coherency really helps this forum be a resource for finding our way through the flotsam of cyberspace and the Controligarchs' efforts to manipulate how we think.
I'm happy to do what I can and do search thread titles using the main topic of the piece as the search term and then dropping the results in the most germane result. With that said, I've several issues:
• Rote memory. I don't have any, which means I don't have a catalog in my head of many of the topics. I remember some that I post to often, but many simply aren't in the ol' mental card catalog. I'm one of those folks that always has 8 balls in the air (what I lack in rote memory I more than make up with my ability to keep those balls from dropping) with the downside being I frequently don't have time to do any deep digging as I'm doing a quick driveby upon encountering an interesting piece.
• Notifications. They seem to be an all-or-nothing affair on this board. It's difficult to describe how many needless, irrelevant, and redundant notifications I get through the course of a day. I might be going to bid on a ~$10 million contract soon; those chummed waters, for instance, bring every vendor in the biz my way by every communication mode imaginable, including those too small to handle the contract among other non-starters. Bottom line, I don't have notifications turned on here as a sanity preservation measure and hence often miss thread suggestions until the next time I'm in said thread.
• Topic organization. My brain seeks to impose rhyme and reason on things, endlessly searches for patterns, or otherwise deal with my nonexistent rote capabilities by instead finding underlying consistencies and using them as a guidepost. Alas, some topics here defy that technique as they are either so broad or so amorphous that everything connoted by the thread label is a candidate to be placed there. Some that consistently flummox my admittedly different drummer synapses include:
"Money, the Fed, Banking, Monetary Policy, Dollar, bitcoin, crypto, Gold/Silver." What involving economics COULDN'T go there?
"The Goolag, Facebook, Youtube, Amazon, Twitter, Gov censorship via Tech Octopus." Everything online PLUS the government hand in it? Way too broad for me to handle, at least consistently and to your standards.
"Antifa-BLM, SJW warriors, gender warriors, victimhood, cancel culture, satanism." I can almost handle this one but ... satanism? So all things "Progressive" and occult go here?
"Homeland Security, Border, sabotage of energy, transportation, environment." I feel like I'm taking an SAT or something: which terms don't belong in this series?
"US-China (& Japan, South China Sea-- Taiwan, Vietnam, Philippines, etc)." So can only US interactions with the countries listed be placed here or can say a Vietnam piece or Japan/Philippines piece live here too?
And so on.
All day long I deal with nitpicky higher ed types that do so as they don't think a given policy should apply to them, and now feel like I'm channeling 'em, much to my shame. And hey, I realize this is an organic place that has evolved over time via the input of numerous users, making some sort of universal cataloging or whatever more than a daunting task, one that would gum up most other folks were a topic they know well to change name. In a lot of ways I think this is a tool problem; SimpleMachines ought to allow tags so that they can be added to posts that cross jurisdictional boundaries and thus achieve your goal of making this forum a resource that indeed was one of the reasons I started posting here way back in the day. Alas, current tools such as Feedly and various clip-boarding apps handle that desire better for me, so my posting here is less to be able to find it again and more of a "hmm, neat piece worth sharing with folks I hold in high regard" deal for me.
With all that said, I suspect I'll do better moving forward as my gray matter gets a handle on underlying patterns and such, but in the interim I trust you understand that I don't drop things where I drop them to cause confusion, but rather as a result of confusion where my admittedly odd way of taking in the world is concerned.
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BBG
I feel your points.
I have been posting and reading the forum for must be near 20 yrs now so I have learned the different threads along the way otherwise I would also have a hard time figuring out which thread to use as the most apropriate one.
The "search" for a particular thread that I recall but cannot find often does not find the right thread for me either.
I am not sure how to improve this function though.
Some threads have been duplicated along the way as well or have overlap topics.
At this point it would be like trying to streamline the encyclopedia.
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Piece tracks Biden admin policy choices and compares them to what then happened to gas prices:
https://realclimatescience.com/2024/01/three-years-of-joe-biden/#gsc.tab=0
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Who cares if our allies in Europe need it due to their embrace of net zero foolishness?
https://legalinsurrection.com/2024/01/biden-pauses-liquefied-natural-gas-export-approvals-in-desperate-bid-to-appeal-to-climate-cultists/?utm_source=rss&utm_medium=rss&utm_campaign=biden-pauses-liquefied-natural-gas-export-approvals-in-desperate-bid-to-appeal-to-climate-cultists
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Sales falling quickly except among the rich and gov purchases:
https://www.marketwatch.com/story/tesla-gm-and-ford-price-cuts-suggest-that-electric-cars-may-be-at-a-dead-end-1091aa16
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Biden and the TikTok Anti-LNG Crusade
His ‘pause’ on export permits may be his most destructive climate act—damaging to the economy at home and U.S. influence abroad.
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Jan. 26, 2024 5:52 pm ET
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Americans received a preview of a second Biden term on Friday when the President halted permits for new liquefied natural gas (LNG) export projects. Climate politics has become the tail wagging this Administration’s economic, national security and foreign policy. President Biden isn’t running for re-election. Climate lobbyist Bill McKibben and his TikTok army are.
“This pause on new LNG approvals sees the climate crisis for what it is: the existential threat of our time,” Mr. Biden said. “We will heed the calls of young people and frontline communities who are using their voices to demand action from those with the power to act.” Didn’t he campaign in 2020 by promising to be the adult in the room?
Now he’s letting TikTokers dictate U.S. policy. Press reports say Biden adviser John Podesta pushed for the “pause”—which tees up an outright ban—after TikTokers and Mr. McKibben made stopping LNG exports a cause celebre. Mr. Biden’s advisers at the White House even met with a TikTok climate “influencer.” The Administration hopes its climate gesture will boost the President’s flagging political support among young people.
Who cares about the real-world impact, or the signal to allies and adversaries that the U.S. isn’t a reliable partner? Europe and Asia should plan to import their gas from Qatar, Russia or even Iran. Xi Jinping and Vladimir Putin now know they can exploit the Administration’s climate obsession to undermine U.S. interests.
During the pause, the Energy Department will conduct an environmental and economic review of LNG exports. “Today, we have an evolving understanding of the market need for LNG, the long-term supply of LNG, and the perilous impacts of methane on our planet” and “pollution from new export facilities,” the White House statement says.
Mr. Biden’s views sure have evolved. As Vice President, he boasted about the benefits of U.S. LNG exports. “The United States is now a net [gas] exporter,” he proclaimed at the 2016 CAF conference. “There are even greater opportunities to supply the energy needs of our partners in Latin America and around the world.”
He was right. Global demand for natural gas is expected to increase 46% by 2050 as countries industrialize and shift from coal. Most developing Asian economies still rely on coal for power, including India (71%), Indonesia (59%), Vietnam (57%) and the Philippines (55%). Global coal exports and power generation last year hit a record.
China was the biggest coal importer, followed by India, Japan, South Korea and Taiwan. Demand for LNG has outstripped supply especially as Europe tries to wean itself from Russian gas. A Bangladesh energy official complained last year that Asian countries couldn’t buy gas because of skyrocketing prices. Instead, they burned coal. How will this be good for the climate?
The climate lobby also doesn’t care that some 2.3 billion people in the world still cook with open fires or stoves that burn heavily-polluting wood, coal, biomass or kerosene. Developing countries want and need gas to escape poverty, which is another reason demand for LNG is expected to exceed supply for decades.
Hence, Russia, Iran and Qatar are expanding their export capacities. By the way, Russia last year supplied Europe with almost as much gas as the U.S. The White House says its pause won’t jeopardize supply to Europe, but energy officials across the pond disagree. Germany accounted for a third or more of the contracted capacity of a large planned Gulf Coast LNG project.
Nobody in the White House seems to understand that countries sign long-term contracts years in advance so they can plan their energy infrastructure and needs. They won’t build new gas plants or import terminals without supply locked in—or they will turn to more reliable sources. Russia now looks like a more reliable energy source than the U.S.
Much of the supply from LNG projects in the works is slated for Asia. They would strengthen U.S. relationships and influence in the region to counter China. Xi Jinping no doubt is elated by the Administration’s pause, which will do more damage to U.S. strategic interests than blocking the Keystone XL pipeline.
***
Re-election imperatives have partly restrained the President’s attack on fossil fuels in his first term, but don’t expect the same in a second. Recall how the Federal Energy Regulatory Commission in early 2022 backtracked on a plan to conduct greenhouse-gas analyses for natural gas pipelines and export projects after West Virginia Sen. Joe Manchin raised a ruckus.
But Mr. Manchin is retiring, and Mr. Biden won’t need to worry about him in a second term. Nor will he have to heed voters in states such as Pennsylvania, Michigan and Wisconsin. Mr. McKibben will lead a no-holds-barred children’s crusade against fossil fuels. Is Mr. Biden trying to give Americans another reason to vote for Donald Trump?
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Good overview of green energy issues, outcomes (higher cost!), and the nitwittery posing as science seeking to create a green stampede:
https://wattsupwiththat.com/2024/01/27/climate-and-energy-fantasy-and-tyranny/
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I’ll Fight Back Against Biden’s LNG Pause
I plan to block every State and Energy department nominee until he relents.
By John Kennedy
Jan. 29, 2024 6:09 pm ET
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LNG tanker in Cameron Parish, La., April 14, 2022. PHOTO: STAFF/REUTERS
The Biden administration has announced a pause on every new and pending permit for liquefied natural gas export terminals in the U.S., including several in Louisiana.
The White House claims this is necessary because the Energy Department based its permit reviews on five-year-old data. Here’s the truth: Climate warriors want President Biden to destroy America’s fossil-fuel industry, but he doesn’t want to pull the trigger himself. By withholding permits, the president can scare away investors, bleed these projects of capital, and claim to have clean hands if the terminals close.
OPINION: POTOMAC WATCH
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Joe Biden's Dilemma on Natural Gas Exports
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Any way you look at it, Mr. Biden’s blockade is bad for America. Consider the Calcasieu Pass 2 export terminal in Cameron Parish, La. Once completed, it will be the country’s largest terminal. Nixing its permit would jeopardize $20 billion in investments for U.S. industry and kill thousands of good jobs in my state.
There is no environmental justification for killing these jobs. Natural gas is the reason America leads the world in carbon-emission reductions. From 2005 through 2019 natural gas drove a 32% reduction in American carbon emissions while creating 1.4 million manufacturing jobs and ensuring that families paid half as much to heat their homes. Apparently, whichever TikTok influencer convinced the Biden administration to ban LNG permits forgot to mention that side of the natural-gas ledger.
Natural gas is also a key to several of the Biden administration’s other environmental pet projects. Electric cars? They plug into an electrical grid powered by natural gas. Wind turbines and solar panels? Natural gas provides a reliable backstop so folks don’t face blackouts when the wind doesn’t blow and the sun doesn’t shine. That’s why the European Commission recognizes natural gas as a sustainable energy source.
Americans will suffer because of Mr. Biden’s attack on natural gas, and so will our allies. When war broke out in Ukraine, the president promised our friends in Europe and elsewhere that they could depend on the U.S. to keep natural gas flowing. Unless his administration plans to run a pipeline through the mid-Atlantic ridge, liquefying natural gas and transporting it on tankers is the only way Washington can fulfill its promises. Our allies shouldn’t have to rely on Russia, Iran and China to keep the lights on.
In a recent letter, I warned Energy Secretary Jennifer Granholm that her proposed pause on LNG export permits is an unjustifiably bad policy. The Biden administration listened to the climate influencers instead and tried to bury this foolish ban in a Friday news dump.
Until Mr. Biden drops this battle against American energy, I’m going to block every nominee he tries to place at the State and Energy departments. Like the Terminator, I’ll be back again and again to stop his nominees and remind the world that he’s intentionally killing jobs and threatening our national security to placate confused climate extremists.
Mr. Kennedy, a Republican, is a U.S. senator from Louisiana.
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Fine indictment of Biden’s recent LNG edict. Lots of useful tables/graphics at the link:
Biden’s 'Pause' on LNG Exports Is Impulsive and Destructive
US LNG pause impacts industry
•Cato @ Liberty / by Travis Fisher / January 30, 2024 at 12:01PM
Travis Fisher
LNG tanker
On January 26, the Biden administration announced it would pause new approvals of liquefied natural gas (LNG) exports. The official news followed several leaked stories—including one prominent article by The New York Times—that triggered criticism from LNG supporters and praise from climate activists.
The announcement appears to be a concession to the “keep it in the ground” movement and the 65 federal lawmakers who asked for the policy change in November 2023. However, some pragmatic progressives see the pause as misguided: “The urgency of the energy transition cannot excuse counterproductive purity tests,” wrote Elan Sykes and Neel Brown of the Progressive Policy Institute.
From the libertarian perspective, the pause is unwise energy policy, an encroachment on free trade, and a continuation of the Biden administration’s use of uncertainty as a political weapon against energy suppliers. Let’s dig in.
What Is Changing, Exactly?
LNG is the liquefied version of natural gas (mostly methane, CH4). Shippers cool the gas to approximately negative 260 degrees Fahrenheit to make it a liquid that is portable via tanker ships. International trade in LNG has spiked in part because of the abundant natural gas resources in the United States, which were enabled by technological improvements in unconventional production from shale formations.
The United States did not export significant quantities of LNG until about 2015, so one might say the industry is in uncharted waters. The aggressive growth in LNG exports (particularly relative to historic levels of imports) can be seen in the graph below.
Liquefied natural gas imports and exports, 1985-2022
(Source.)
Although the large quantities of exports are new, the legal apparatus is not. Specifically, under the Natural Gas Act (NGA), the Department of Energy (DOE) must approve any import or export of natural gas. Congress passed the NGA in 1938, so the statute predates the organization of the DOE itself, which was formed by Congress in 1977 by the DOE Organization Act.
Before the DOE was established the responsibilities in this section of the NGA were carried out by the Federal Power Commission (renamed in 1977 to the Federal Energy Regulatory Commission or FERC). Now the two agencies each regulate different parts of the LNG industry. DOE explains their roles as follows:
The NGA directs DOE to evaluate applications to export LNG to non‐FTA [Free Trade Agreement] countries. … Typically, the Federal Energy Regulatory Commission (FERC) has jurisdiction over the siting, construction, and operation of LNG export facilities in the US In these cases, FERC leads the environmental impact assessments of proposed projects consistent with the National Environmental Policy Act, and DOE is typically a cooperating agency as part of these reviews. Obtaining a DOE authorization to export LNG to non‐FTA countries is an important step for most projects in their path toward financing and construction.
The Biden administration said the DOE will now scrutinize applications to export LNG through the lens of climate change and other factors in determining whether additional US LNG exports are in the public interest. The White House stated:
The current economic and environmental analyses DOE uses to underpin its LNG export authorizations are roughly five years old and no longer adequately account for considerations like potential energy cost increases for American consumers and manufacturers beyond current authorizations or the latest assessment of the impact of greenhouse gas emissions. Today, we have an evolving understanding of the market need for LNG, the long‐term supply of LNG, and the perilous impacts of methane on our planet.
The DOE has never denied an LNG export application, so this is a big shift in public policy.
Who Carries the Burden of Proof?
The rise of low‐cost natural gas production in the United States—combined with high prices and resource constraints in other parts of the world—means US producers can profitably refrigerate, ship, and deliver gas to other countries. In contrast to other energy resources that require mandates and subsidies, LNG exports merely require approval from the federal government. All the government has to do is get out of the way.
The text of the NGA establishes approval as the default position. The statute says the DOE “shall” issue an order approving a project “unless, after opportunity for hearing, it finds that the proposed exportation or importation will not be consistent with the public interest.” Hence a pause to further consider new factors is the wrong posture—LNG approvals should continue until and unless DOE makes a new finding that LNG exports are inconsistent with the public interest. Ideally, of course, the government shouldn’t have the power to bar energy exports in peacetime.
There is a case to be made on either side of the climate debate regarding LNG.
Supporters of LNG exports cite the lower CO2 emissions of natural gas combustion over coal. By exporting natural gas and displacing the use of coal globally, the argument goes, the United States can help other countries reduce their CO2 emissions. We have certainly seen coal‐to‐gas switching bring down emissions in the United States.
Opponents of LNG exports, however, argue that the energy required to cool and transport natural gas—not to mention leakage of uncombusted methane, itself a potent greenhouse gas—makes it little better for climate change than burning coal.
The Administration’s Action is Arbitrary and Capricious
As experts debate the net impact of natural gas exports on factors like global climate change, the structure of the NGA indicates that approvals should move forward while the DOE deliberates. In July 2023, the DOE rejected a petition by environmental groups to do precisely what it now accepts—to undertake a blanket review of its LNG policy.
In fact, the DOE’s rejection notes in the first sentence of the document that the Administrative Procedure Act (APA) provides that each agency “shall give an interested person the right to petition for the issuance, amendment, or repeal of a rule.” The DOE’s new policy of a “pause” runs afoul of the APA and deprives interested parties the ability to challenge it before it goes into effect.
The new stated policy of a pause is especially capricious—meaning impulsive or unpredictable—given how the DOE responded to the environmental petitioners just six months ago:
After carefully considering Petitioners’ request, DOE is denying the Rulemaking Petition. As discussed below, DOE has reasonably exercised its discretion to implement its LNG export program through a combined approach of individual adjudications and export‐focused regulatory actions, rather than a single rulemaking of broad applicability. DOE‘s existing LNG export regulatory program is responsive to Petitioners’ principal concerns—namely because, since 2013, DOE has, in fact, established a decision‐making process under NGA section 3(a) that “respond to the complex issues raised by LNG export and appropriately serve the Natural Gas Act,” as Petitioners request. (emphasis in original)
How can the DOE now claim that it does not need to go through a formal rulemaking process in reversing course and implementing a new LNG approval regime? Even the environmental groups that want the DOE to shut down LNG exports should agree that their petition for a new rulemaking was the appropriate vehicle for enacting new policy.
Further, in the event of an administrative policy change at DOE that rises to the level of national significance—I think an indefinite LNG export pause qualifies—the Supreme Court’s “Major Questions Doctrine” should come into play. As the Congressional Review Service summarized the doctrine, “if an agency seeks to decide an issue of major national significance, its action must be supported by clear congressional authorization.” (emphasis in original) Did Congress give the DOE clear authorization to deny LNG export applications based on the factors DOE now finds important?
Political Uncertainty as Punishment
We have already seen the playbook of capricious policy in action. In February 2022, FERC issued new policy statements “providing guidance for future consideration of natural gas projects by the Commission.” The policy change—which suggested that an unspecified level of climate mitigation would be necessary to serve the public interest and receive FERC approval of gas pipeline projects—injected enormous uncertainty into the pipeline approval process.
The concept of the February 2022 policy statement was also the subject of a series of rebuttals (prebuttals?) by Commissioner Bernard McNamee, who argued forcefully beginning in 2019 that “the commission does not have the authority under the NGA or [the National Environmental Policy Act] to deny a pipeline certificate application based on the environmental effects of the upstream production or downstream use of natural gas nor does the commission have the authority to unilaterally establish measures to mitigate” emissions.
Ultimately, FERC withdrew its proposal after receiving blistering blowback from members of the Senate Energy and Natural Resources Committee (ENR). Senator Joe Manchin (D‑WV), ENR chairman, said FERC was “constructing additional road blocks that further delay building out the energy infrastructure our country desperately needs.” Delay is the practical impact of political uncertainty.
The Environmental Protection Agency (EPA) appears to be using the same strategy. Last year, the EPA proposed in its power plant rulemaking to mandate two unproven technologies—green hydrogen and carbon capture—for new or reconstructed power plants to meet greenhouse gas emission targets. The EPA proposed that “affected sources that commenced construction or reconstruction after May 23, 2023” would need to meet the requirements of the final rule.
The electricity generation industry remains in the middle of the uncertainty caused by the EPA’s unworkable proposal. For any new or reconstructed natural gas‐fired power plant (affected source) subject to EPA’s new standard, a company can construct the unit today and be held—at some future date—to a standard that does not yet exist and may be impossible.
Given the recent track records at DOE, FERC, and EPA, crippling uncertainty is beginning to look like the aim of energy policy rather than an unfortunate side effect.
LNG Export Pause Offers a Lesson in Economic Thinking
The White House listed “potential energy cost increases for American consumers and manufacturers” as one justification for the LNG pause. It is true that, in the very short term, an announcement that the federal government will forcibly restrict the export of natural gas would likely cause its domestic price to fall. But, as French economist Frederic Bastiat implored, we should attempt to foresee long‐term impacts. Bastiat wrote:
There is only one difference between a bad economist and a good one: the bad economist confines himself to the visible effect; the good economist takes into account both the effect that can be seen and those effects that must be foreseen.
Yet this difference is tremendous; for it almost always happens that when the immediate consequence is favorable, the later consequences are disastrous, and vice versa. Whence it follows that the bad economist pursues a small present good that will be followed by a great evil to come, while the good economist pursues a great good to come, at the risk of a small present evil.
Restricting the sale of LNG abroad would send ripple effects up the supply chain, blunting incentives to explore for more natural gas and to produce what’s already been found. Advocates of thwarting the global natural gas trade—and of hoarding domestic natural gas—are focused on temporary, short‐term impacts to commodity prices and ignoring long‐term impacts to natural gas supply infrastructure.
Whose Gas Is It Anyway?
Economics aside, what business does the federal government have in dictating the direction of an industry that delivers a product that so many people find valuable? Advances in directional drilling and hydraulic fracturing technology (commonly referred to as “fracking”) allowed American firms to produce astonishing amounts of useful energy from hydrocarbons trapped over a mile deep in rock formations. (Turn useless, 6,000-foot-deep rock into electricity? Yes, please.)
People here and abroad want to use that energy. Natural gas is a valuable resource—we use it not just to fuel power plants but to cook food, heat homes, and fabricate a dizzying array of plastics, fibers, and even medicines. Natural gas liquids like propane and ethane are especially useful as a material feedstock but also have energy‐related applications.
The DOE, EPA, and FERC may try to stifle the progress of the natural gas industry in the name of climate change (or industry protectionism), but the demand for energy will always be there. Globally, energy consumption continues to increase, as shown below.
Increase in global energy use 1900-2022
(Source.)
The challenge to meet growing demand should be exciting because energy consumption reflects the increasing living standards of countless millions (hopefully billions) across the globe. The US Energy Information Administration stated in its 2023 International Energy Outlook: “as incomes and population rise over time, energy consumption increases as more people can afford to drive, use commercial services, demand goods, and control building temperatures.”
For the hundreds of millions of people worldwide who still lack access to electricity, LNG exports could be the difference between dark and light.
https://www.cato.org/blog/bidens-pause-lng-exports-impulsive-destructive
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https://www.startribune.com/twin-cities-gas-prices-float-near-3-mark-expected-to-keep-rising/600340292/
What is he going to do, take more from the Reserve?
Why are gas prices going up in winter? Probably increased government consumption. Also, constraints on production.
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https://www.startribune.com/twin-cities-gas-prices-float-near-3-mark-expected-to-keep-rising/600340292/
What is he going to do, take more from the Reserve?
Why are gas prices going up in winter? Probably increased government consumption. Also, constraints on production.
Not to mention the signal Biden is sending to the market with his LNG antics. Is it a shot across Abbott’s bow, a bone thrown to environmentalists, or a case of a leopard (one that belongs in a memory ward) showing its true spots?
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Well this leaves me sniggering:
Volvo, An Early Electric Car Adopter, Cuts Off Funding For Its EV Affiliate
Move follows other retrenchments by big automakers as sentiment turns against EVs
Follow the WSJ in Apple News
STOCKHOLM—Volvo Car said it won’t provide further funding to Polestar, the electric-car maker it created with Volvo’s Chinese owner Geely—the latest EV retrenchment by the global auto industry.
The auto industry’s pivot to electric vehicles has been rocked by setbacks this year, just as a flood of new battery-powered models is hitting showrooms.
Earlier this week, French automaker Renault said it has decided to cancel the initial public offering of its electric-car unit Ampere. Ford, meanwhile, has slashed production of its electric F-150 Lightning, a pickup truck that has generated major buzz since its launch. Rental-car firm Hertz has said it was dumping about one-third of its EV rental car fleet, replacing the cars with gas-engine vehicles.
Also earlier this week, Tesla—the world’s most valuable automaker—warned of notably lower growth this year. Data earlier this year has shown a slowdown in EV sales growth in the U.S., automakers delaying or cutting back on plans and anxiety rising among dealership owners.
In a sign of investor unease about automakers’ march toward an EV future, Volvo shares surged more than 20% Thursday on its decision to cut off funding to Polestar.
Volvo and Geely founded Polestar as a stand-alone EV maker, separate from Volvo’s substantial in-house effort to go electric. Through a special-purpose acquisition company merger, the two listed it on Nasdaq in 2022. Polestar shares have fallen 83% since then.
Analysts have highlighted how Volvo’s 48% stake in Polestar has been a drag on its resources, with the company struggling with losses amid the slow consumer uptake of electric vehicles and the increasingly competitive market, tapping Volvo for around $1 billion in financing while the company works through a turnaround plan.
The company’s Polestar stake impaired its group EPS by around 1.9 Swedish kronor (18 cents) in 2023, UBS analyst David Lesne said in a note. This compares to Volvo Car group EPS of SEK4.4 for the year.
Volvo said Thursday it will extend the repayment period for the existing convertible loan by 18 months to the end of 2028. But it said it would be concentrating its financial resources on Volvo’s own needs from now on.
The company said it was also evaluating a potential adjustment to its shareholding in Polestar, including a possible distribution of shares to Volvo Cars’ shareholders, including Geely.
If it decides to distribute its stake to shareholders, Geely would become a significant new shareholder.
The Chinese auto group said in a statement that it will continue to provide full operational and financial support to Polestar as an independent exclusive brand going forward. That support wouldn’t require a reduction of its shareholding in Volvo Car, it added.
Volvo Car Chief Executive, Jim Rowan, said on a call after outlining the news that a separation from Polestar is a natural evolution and that now is the right time to consider reducing its shareholding, and for Polestar to look for alternative funding.
Meanwhile, Volvo posted a rise in fourth-quarter revenue, driven by higher volumes and said it expects the growth rate in retail sales to increase this year as long as there are no major disruptions.
Net profit attributable to shareholders rose to 3.11 billion Swedish kronor ($299.2 million) from SEK2.46 billion a year earlier, as revenue rose 4% to SEK109.44 billion.
Analysts polled by FactSet had projected a net profit of SEK4 billion on revenue of SEK108.35 billion.
“We remain firm on our ambition to report an EBIT margin above 8% for 2026, and now do so based on expected revenues between SEK550 billion-SEK600 billion,” Rowan said.
“By the end of 2026, this calculates to a revenue compound annual growth rate of 11%-15% from 2023 to 2026.”
In terms of total 2024 retail deliveries, Volvo aims for a higher year-over-year growth rate than in 2023.
Write to Dominic Chopping at dominic.chopping@wsj.com
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https://apple.news/ApX5K5KZlR1qv1nwN-0VMCw
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if Trump wins time to invest
in EOG, LNG and CVX or Oke?
thoughts?
If Biden wins sell GM ?
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https://arstechnica.com/science/2024/02/over-2-percent-of-the-uss-electricity-generation-now-goes-to-bitcoin/
At this rate, someday that will be 100%?
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Tee hee. The free market is an actual thing. Who knew?
https://joannenova.com.au/2024/02/just-pause-for-a-moment-to-appreciate-how-fast-the-ev-transition-is-coming-undone/?utm_source=rss&utm_medium=rss&utm_campaign=just-pause-for-a-moment-to-appreciate-how-fast-the-ev-transition-is-coming-undone
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Pair of Dem congresscritters take issue with Biden’s LNG antics he's slung at Abbott.
Biden's LNG decision will make it harder to reach our climate goals
The Hill News / by Mary Landrieu and Tim Ryan / February 08, 2024 at 07:38AM
China is orchestrating a massive investment in solar and wind power to meet its growing energy needs, installing as much renewable energy capacity as the rest of the world combined, six years ahead of schedule.
However, this impressive success story masks an ugly truth: Without natural gas as a foundation, this renewable power is inextricably linked with rapidly expanding coal-burning in order to ensure grid reliability, which is creating more harm than good for our climate.
China quadrupled permits for new coal power plants in 2022, building six times more than all other countries. It now burns more coal than the rest of the world combined. Although China is the most disturbing example, the use of coal is expanding across developing countries in Asia, including India — which also, despite its push for renewables, will be heavily reliant on coal for the next several decades. Coal today accounts for 44 percent of global emissions, with nearly 70 percent coming from two countries, China and India. Even Germany, which Europe’s leader on renewable power installation, is turning its coal-fired plants back on to restore grid reliability in the absence of sufficient natural gas supply because of the war in Ukraine.
As Democrats supporting President Biden, we are aligned with the imperative to reverse climate change quickly with bold action, including ramping up investments in renewables and clean energy. The Inflation Reduction Act funds vital technologies such as carbon capture, rare earth mineral production, and hydrogen, which will all be critical to moving toward net-zero carbon emissions. That work has to happen now to reach scale in the years ahead.
But low-carbon natural gas must be part of the equation too, both here at home and exported abroad. That’s why Biden’s recent actions to halt LNG approvals is so disappointing.
Bipartisan energy leaders in Congress understand what’s at stake, as 30 of them traveled to COP28 in Dubai. At a recent summit at the Capitol following their trip, Democrats and Republicans, business, labor and renewable power leaders, have all identified the need to address permitting reform and get back to building energy infrastructure for both renewables and natural gas.
We’ve shared this sentiment with the Biden administration, including the critical role American natural gas exports must play to move the world off coal and provide our allies abroad with secure energy, so they aren’t instead forced to rely on hostile leaders. In fact, during this administration, American natural gas exports have largely been credited with stopping Putin’s attempts to bend European economies to his will. They have also helped Europe's economies stave off crippling price increases.
The U.S. was once heavily reliant on coal, too, right up until 2005. But the growth of U.S. natural gas production and power plant conversions away from coal have helped us lead the world in emissions reductions — accounting for nearly 60 percent of US carbon emission reductions over the last 15 years. And while there is still work to do on methane, the natural gas industry is answering the call, certifying their gas to beat strict methane standards, investing in satellite tracking, and collaborating with the United Nations Methane Partnership.
Shrill and impractical voices in this debate have long blatantly ignored these realities, dishonestly attempting to force a false binary choice of renewables or fossil fuels upon a complex debate over geopolitics, economics, and climate. Young people absorbing their misinformation need to understand the future risks of the policies they are advocating.
They will even claim that natural gas is worse than coal, despite the fact that natural gas emits 50 percent less carbon dioxide than coal. If they had their way in ending natural gas use, many economies, including the U.S. would need to burn more and more coal to keep the lights on — moving us backward on climate — no matter how many wind and solar panels we install.
The value of natural gas is backed up by leading and trusted scientific experts like former Obama administration Energy Secretary Ernie Moniz, who has said natural gas should be viewed “as a multi-decadal, critical component of the energy transition.” One recent study found that simply converting the top 5 percent of the world’s dirtiest power plants to natural gas would cut electric sector global emissions by 30 percent.
So what are we waiting for, and how can we meet the challenge?
The answer is not to stop natural gas buildouts here in the U.S., but to expand energy infrastructure, meeting growing demand at home to ensure a solid foundation that supports the scaling up of renewables, and moving this secure, cleaner fuel overseas to cut coal emissions abroad.
It's time for radically practical thinking about the urgent challenges we face on energy and climate, from both Democrats and Republicans. From our time serving with him in Washington, we know Biden to be the type of leader capable of this.
We urge his administration to rethink this counterproductive policy, which not only sets back our climate agenda, but also undermines his strong record of rebuilding American jobs and manufacturing.
Mary Landrieu (D-La.) served in the U.S. Senate from 1997 to 2015. Tim Ryan (D-Ohio) represented Ohio's 13th congressional district from 2003 to 2023. The two are co-chairs of Natural Allies for a Clean Energy Future.
https://thehill.com/opinion/energy-environment/4453275-bidens-lng-decision-will-make-it-harder-to-reach-our-climate-goals/
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Good for them for speaking out and speaking truth. Moderate Democrats without a party or a state, both are former elected officials.
In their last Senate elections Mary Landrieu was defeated in the 2014 Louisiana runoff election to Republican opponent Congressman Bill Cassidy 56% to 44%. In 2022, Tim Ryan lost to Republican JD Vance in Ohio by 6 points. Tim Ryan was the most reasonable voice in the 2020 Democratic Presidential race and gained zero traction. Their party would like to ban your grandfather's Oldsmobile.
Tim Ryan would make a good 'no-labels' candidate.
Question, is their (former?) party listening? No. The Dem Party is doing exactly the opposite of the common sense they advocate.
We need energy when the sun is down and when the wind is calm. We need energy just to build and transport the solar and wind infrastructure around the globe. We need fossil fuel energy, of which natural gas is the cleanest. We need more power on the grid to support the transportation and heating sectors BEFORE we switch it all over. We need to export clean energy or the rest of the world will find less clean alternatives. But no. Not unless you vote all of them out and the other team in.
Natural gas replacing coal is what lowered our emissions, they point out. It happened because of fracking. It happened under Obama, no thanks to him. It happened because of American ingenuity and because of long term, risk-based investments (some dare to call it capitalism).
Long term investments are not made when you say you will end that industry in 5-6 years.
What they write is all true but mostly we should be pursuing nuclear. Not mentioned because they are pursuing one interest. Instead of half the carbon emissions of coal, nuclear power has no carbon emissions. For the most part, (almost) all the base energy should be nuclear and all the on-demand energy should be natural gas. Solar and wind can lower those demands but electrical demands aren't going lower as we try to electrify everything.
"China is burning more coal than the rest of the world combined", and we are still subsidizing them and leaving them out of our meaningless 'climate agreements'. If Leftist climatists were serious, they would be strong on sanctions and trade with China, but they aren't. If you build it in China, it is dirtier than if you build it here.
No mention of pipelines like the one that Joe Biden cancelled in his first minute in office. What is the safest way to move oil and natural gas? Pipelines. To mention it is to criticize Biden, and their is an appeal to Biden and his handlers.
"We’ve shared this sentiment with the Biden administration..." - to no avail. The other party (R) already agrees with them, and now holds their seats.
A vote for today's Democratic Party is a vote against your own energy and economy, and food, and they aren't making the environment any cleaner with what they are doing to us.
The fastest path to a better environment, including reducing levels of CO2, is to focus on prosperity. China and India are using too much coal because they are still developing economies, and following them will be the rest of the developing world. Only economies of prosperity can afford the cleanest solutions , a lesson learned when we discovered the filth of East Germany as compared with the west. Command economies (cf. China) aren't cleaner.
Why are doing all these things to put freedom and prosperity and a cleaner environment further out of reach?
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BP goes from saying it would cut it’s oil consumption by 40% to increasing purchases and production:
https://joannenova.com.au/2024/02/bp-lost-1b-in-wind-power-and-flips-from-trying-to-cut-oil-to-increasing-it/?utm_source=rss&utm_medium=rss&utm_campaign=bp-lost-1b-in-wind-power-and-flips-from-trying-to-cut-oil-to-increasing-it
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Hmm, ever so curious: several left leaning, anti-energy foundations and such donate to Biden and … Biden puts LNG exports on hiatus. Just a coincidence, just like all the other money associated with the “Biden brand.”
https://www.washingtonexaminer.com/policy/energy-and-environment/2895813/biden-left-wing-climate-activists-halt-lng-exports/?fbclid=IwAR13rpntjEfCDAwLFM60vN4GC-PyCVonr-Xfp4m3nWBfqRB8J0h0sR2w1nI
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https://www.youtube.com/watch?v=pNS7Qojr1JQ
We already know most of this, but please watch and share. 5 minutes.
I like solar and wind power. Everyone should have some form of backup. But remove the subsidies. Remove the mandates. Let the alternatives compete freely.
For one thing, the subsidies have been a massive wealth shift from poor to rich.
And still, no one mentions nuclear. Round the clock. Carbon free.
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"I like , , , wind power."
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"I like , , , wind power."
Touche! :-D
I was thinking - wind power - more like this:
https://www.youtube.com/watch?v=qMLD8KlkQeI
Warning, you might want to stop watching at the 2:40 mark.
https://www.youtube.com/watch?v=O4rdb_2TTf4
Speaking of birds of prey, we portaged my catamaran into the Boundary Waters 'Canoe Area' some years ago, a million acres non-motorized,
now against federal law to bring in a sailboat, and bald eagles came to see what was up...
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https://www.oann.com/newsroom/study-claims-evs-release-more-toxic-emissions-are-worse-for-environment-than-gas-powered-vehicles/
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I would love to hear administration Deep Thinkers justify Biden’s LNG policy and explain how it serves US interests. And given the Biden Brand’s business model I wonder if any back channel funds are involved:
https://freebeacon.com/energy/hamas-sheltering-qatar-cashes-in-on-biden-natural-gas-pause/?fbclid=IwAR1NezWAGrzRlaK56uLBcJScRjJxEXeFSLckeaswdx8bxh7cYUwmHa1bMxs
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Isn't this another case of Biden funding terrorism?
https://en.m.wikipedia.org/wiki/Qatar_and_state-sponsored_terrorism#:~:text=In%20a%20press%20conference%20on,countries%20to%20continue%20their%20blockade.
And it's not really 'indirectly' either. If true, it's a direct result.
Obama-Biden already paid for the October 7th war on Israel with plane loads of cash phone to the world's number one state sponsor of terror.
Reminds me of Robert Gates saying Biden was wrong on every major foreign policy decision going back to the previous century.
I get it that Biden is a moron and that his advisors are wrong headed on policy, but I don't get what rank and file Democratic voters are thinking. Is this really what you want? We don't want to be an exporter of clean energy, while the third world burns more and more coal?
He's trying to 'improve' domestic energy production by shrinking their market?
And what is a 'pause', an executive order pause? Didn't we once learn that a federal law originates in the house, goes to the Senate and then to the president for his signature? None of that happened but this is a law?
If it was for National Security purposes, we just saw it backfired.
If it is somehow tied to a war effort led by our Commander in chief, I don't recall Congress declaring war, on anyone lately.
Lawless laws.
Like the capital gains tax on inflation. It never went through Congress but you go to jail if you don't pay it.
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The Green Lobby and their fellow travelers so consistently seek to limit American energy production on so many fronts it's difficult to include anything other than they are seeking to reduce us to some form of agrarian or even hunter/gatherer society, with all sorts of reductions in population size likely viewed as a feature rather than a bug, particularly by any enemies funding these misguided efforts. In this instance the transformers hung from every power pole in the nation are targeted:
https://legalinsurrection.com/2024/03/energy-department-poised-to-zap-nations-electrical-transformers-which-are-already-in-short-supply/?utm_source=feedly&utm_medium=rss&utm_campaign=energy-department-poised-to-zap-nations-electrical-transformers-which-are-already-in-short-supply
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"Green" projects and other "climate" efforts are salted through every government budget at every level:
The most egregious theft of collective wealth and well-being -- and it is flat-out theft -- is the churn on “alternative” forms of energy production. Senator Tommy Tuberville of Alabama said last week in an interview with Steve Bannon that the U.S. has spent some $7 trillion over budget in the last three years, and 25 percent of that went to "climate change" projects. They are all like Solyndra, massively subsidized and within a decade, massive failures. "The investors take a tax loss," said Tuberville, "then move onto the next effort where they again loot the public." This is salted through all the investment banks, retirement accounts. It represents all putative growth.
In June of 2023, the Department of Energy admitted that it had allocated $1.3 trillion for "clean energy" investment support since 2020, and that spending rose 25 percent from 2021-23. This is a fraction of what was really spent. Further, this money is not only based in debt, thus raising inflation, but it is also raising energy prices. It is the principal reason that almost 25 percent of us, according to economist Peter St. Onge, have been forced to choose between heat and food this winter.
What a choice.
Seventy-five percent of $7 trillion is $1,750,000,000, in an annual gift to the rich. The World Economic Forum projects that climate spending in the U.S. will triple over the next ten years. Biden's "climate" budget is $5.7 trillion. Triple that to $20 trillion. No wonder the market is booming. The U.S. has pledged another half a trillion in “low carbon electricity” under this year’s Paris Climate Accord. And further:
Among all measures tracked since 2020, direct incentives for manufacturers aimed at bolstering domestic manufacturing of "clean" energy now total to around $90 billion.
Since the start of the global energy crisis, governments have also allocated $900 billion to short-term consumer affordability measures, additional to pre-existing support programs and subsidies. Around 30 percent of this "affordability" spending has been announced in the past six months, and despite calls to better target households and industries most in need, only 25 percent of affordability measures are targeted towards low-income households and most-impacted industries.
Much of this last $900 billion is direct subsidy to the wealthy in annual subsidies for clean energy. This is again, annual subsidy, so look at the last twenty years. President Obama started this program, therefore, we are looking at a $10 - $ 20 trillion gift to the rich since the Lightbringer took office. What is not counted in these budgets are the losses that accrue from the failure of "green energy" projects, which is the taxpayer's loss.
Last year, investors in Spain's green energy collapse took the government to court to claw back subsidies from a dead industry in a country with a debt 400 percent larger than GDP. No wonder millions on the street want to outlaw socialism. As is clear from Spain, when the government runs out of money the first thing to go is the subsidy to green energy, after which the enterprise fails immediately.
In my neck of the Canadian woods, you can install a solar system for $20,000, and get a 25 percent subsidy, as does the installer whose business the government created via “free” “investment.” I live in a rain forest. Which means solar is not available during winter rains and not needed during the summers. Recently everyone with a few extra bucks has taken up the government offer to install heat pumps, also subsidized by between 50 percent and 75 percent. Rain forests mean hydro power, which is essentially, greenhouse-gas-free, and the most inexpensive "fuel," but an almost-free heat pump? Again win/win for the upper-middle-class because no one in Canada’s increasingly massive working class can afford it.
Solyndra? Never heard of it!
This model was invented by politicians in power. The first person to notice it was Peter Schweizer; in Throw Them All Out, he details the billionaire investors who funded Obama and who were cashed out via various solar and wind projects. Hundreds of billions of dollars went missing on Obama’s various "clean energy" projects.
This year, every government department is “investing” in clean energy, vis, a quick Google search, will show. Pages and pages of boastful press releases follow. Every agency is in on the boondoggle. NOAA, the National Oceanic and Atmospheric Administration, and the U.S. Patent and Trade Mark Office have signed a collaborative agreement to advance climate technology. Putting aside the fact that "climate change" is neither imminent nor dangerous, the government should not be creating patents. Innovation should be carried out by the private market, where there are controls.
As we discovered during Covid, government patents on both the virus and the vaccine were not subjected to court challenge, double blind testing, or feasibility. There is no number attached to NOAA's "initiative," but this is representative of ten thousand such projects salted through every government bureau. All that money is wasted. Wind and solar and the various battery projects have not managed to support the electrical grid in any substantial way, hovering, on average, around 4 percent. Despite this mind-boggling waste of money, in September last year former New York City mayor Michael Bloomberg pledged another $500 billion to shutter the equivalent of 40 percent total electricity use of nine states, including California, Florida, New York, Illinois and Texas.
What has been the result of trillions of public money shunted into “clean” “green” “energy” on the actual energy grid? Robert Bryce, an acknowledged expert, shows that it is failing. A speech he gave at the winter meeting of the National Association of Regulatory Utility Commissioners showed astonishing, across-the-board failure in every metric you can imagine.
"Climate Policy" is considered the most significant risk. As Bryce describes, "green energy" has meant Europe is deindustrializing, Ford lost $64,731 for every EV it sold, and the IEA states that global coal use will hit another new record of 8.5 billion tons. Coal use increased 35 percent in last summer’s heat wave. Wind dropped by 21 percent.
Climate policy breaks everything. It breaks communities, it encourages widespread theft of public money, it starves productive work and manufacturing, it has punched down on the less advantaged, and it is destroying the fabric of our lives. And for what?
Elizabeth Nickson was trained as a reporter at the London bureau of Time Magazine. She became European Bureau Chief of LIFE magazine in its last years of monthly publication, and during that time, acquired the rights to Nelson Mandela’s memoir before he was released from Robben Island. She went on to write for Harper’s Magazine, the Guardian, the Observer, the Independent, the Sunday Telegraph, the Sunday Times Magazine, the Telegraph, the Globe and Mail and the National Post. Her first book The Monkey Puzzle Tree was an investigation of the CIA MKULTRA mind control program and was published by Bloomsbury and Knopf Canada. Her next book, Eco-Fascists, How Radical Environmentalists Are Destroying Our Natural Heritage, was a look at how environmentalism, badly practiced, is destroying the rural economy and rural culture in the U.S. and all over the world. It was published by Adam Bellow at Harper Collins US. You can subscribe to her Substack at elizabethnickson.substack.com/
https://the-pipeline.org/how-green-projects-are-looting-the-treasury/
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Can't happen fast enough:
Bankers are retreating from decarbonisation as reality sinks in
Johnathan Pearce (London) · Economics, Business & Globalization · Environment
From a Bloomberg article entitled UBS Banker’s Frustration Exposes Cracks in World of Climate Finance
The article makes it clear that banks are struggling to deliver on credible “decarbonisation” financial policy and remain profitable concerns. Considering how Western taxpayers spent billions bailing out banks more than a decade ago, it would be extraordinary if banks were to deliberately restrict their earnings streams through going full “dark green”.
More:
“Banks are living and lending on planet earth, not planet NGFS,” Berkey told the group in an impassioned speech, alluding to the Network for Greening the Financial System, a collection of central bankers that creates model scenarios for how the energy transition may evolve. Details of what transpired at the meeting hosted by the Financial Stability Board — a coordinator of global regulations — came from people who were in the room but asked not to be named discussing private talks. Berkey confirmed his participation, declining to say more.
The UBS banker’s outburst, which got little pushback from those present, exposes the cracks emerging in a multitrillion-dollar transition finance project, and taps into what’s rapidly becoming one of the most contentious issues in the global banking industry. In private, senior bankers in sustainable finance divisions in London, New York, Toronto and Paris grumble about unrealistic expectations from regulators, civil society and climate activists around the industry’s role in getting the planet to net zero.
“Outburst” – translation – telling it like it is.
The standoff that’s brewing is setting the stage for a showdown at the heart of the ESG movement, where environmental, social and governance considerations are being pitted against old-fashioned capitalism.
Not really “old fashioned capitalism”. Just “capitalism”. We had more than a decade of ultra-low interest rates via quantitative easing. During this period, the business case for eliminating fossil fuels and powering a modern economy via solar, wind and happy thoughts appeared viable. With interest rates at their more normal long-term levels, some of the more fanciful projections don’t add up. This is called “reality”. Capitalism, which hinges around private property rights, voluntary exchange, and the desire to maximise the use of scarce resources that have alternative uses, is based on reality. Elsewhere, the article alludes to how capitalism produces “negative externalities” (carbon emissions) that must be controlled. What the article doesn’t stop to consider is that there are “positive externalities” from a prosperous world: more resources to fix problems, more wealth, higher living standards, more resilience, etc. (This is the broad thesis of the excellent book by Alex Epstein, Fossil Future, which totally debunks the alarmist case. See this video also featuring Epstein and Bryan Caplan, among others.)
Banks that had enthusiastically committed to align their entire operations with net zero goals are having second thoughts as the real-world ramifications of acting on those pledges become painfully apparent.
That’s what happens when you sign up to something that appears fashionable. Ditto with DEI (diversity, equity and inclusion, or, as I read the other day, “Didn’t earn it”).
Some of the world’s biggest lenders, including Deutsche Bank AG, HSBC Holdings Plc and Bank of America Corp., are adding caveats to their restrictions on financing coal, the planet’s most-polluting energy source.
Very wise.
BlackRock Inc. Chief Executive Officer Larry Fink says he has stopped using the term ESG and emphasized the world’s largest asset manager’s work with energy firms in a letter to investors this week. The firm has scaled back its participation in international climate investing alliances.
Fink is now more likely to focus on the imminent retirement crisis of the US and the developed world. Some of that has been brought around as birthrates have fallen. But hang on a minute, I thought having kids was bad for the Earth?
It is tough being green, isn’t it?
https://www.samizdata.net/2024/03/bankers-are-retreating-from-esg/
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How Green Energy Makes Us Vulnerable to Cyberattack
EVs and other digital-controlled products open extra access to the grid, which enemies can exploit.
Allysia Finley
By
Allysia Finley
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March 31, 2024 2:26 pm ET
China launches an amphibious attack on Taiwan. The U.S. responds with a missile attack to sink Chinese ships. Within minutes, California is plunged into darkness, followed by New York and Washington. Electric trucks around America start crashing into other vehicles.
This may seem far-fetched, but government climate policies are making it easier for the Chinese Communist Party to wage a multifront cyberattack. Even the Biden administration is raising alarms about how malign actors could exploit electric vehicles, chargers and rooftop solar systems to wreak havoc on the homeland.
So-called distributed energy systems provide an increasing number of entry points to the grid. An academic study last November modeled a case in which a remote attacker commandeered public EV chargers to create electric frequency distortions that led to a systemwide blackout in Manhattan.
“Such attacks will become feasible by 2030 with increased EV adoption,” the authors warned. President Biden hopes to install 500,000 public EV chargers by 2030. That’s 500,000 potential bots America’s enemies could turn into weapons to take down the grid.
Rooftop solar and renewable generators are similarly vulnerable. A 2022 Energy Department cybersecurity briefing noted that distributed renewable generators could be more vulnerable than fossil-fuel and nuclear plants to cyberattacks because “their output is highly configurable in unique and powerful ways” and “software-driven and digital-controlled.”
“As more solar is installed and inverters become more advanced, this risk grows,” the Energy Department warns. If a solar inverter’s “software isn’t updated and secure, its data could be intercepted and manipulated. An attacker could also embed code in an inverter that could spread malware into the larger power system.” Notably, Chinese companies including Huawei—whose telecom equipment the U.S. has blacklisted for national-security reasons—dominate the global solar-inverter market.
EVs present their own risks. New cars are equipped with high-tech software that improves navigation, fuel efficiency and safety. EVs additionally connect to the grid when they charge and are controlled by software systems that can be updated remotely. Tesla has been able to increase a vehicle’s battery range and power input simply with a remote software update.
Many Chinese EVs are even more advanced than those coming off U.S. assembly lines. They can alert drivers when a traffic light is about to turn green and trigger flashing lights or audible warnings if a driver appears to be getting drowsy.
But these systems rely on sensors, facial recognition and microphones that can collect sensitive information. Vehicles can record audio and video, as well as gather intel about the driver’s identity, finances and contacts if his phone is connected by Bluetooth. If the idea of the government using “smart cars” to surveil and control society sounds Orwellian, welcome to the People’s Republic of China.
The Associated Press reported in 2018 that China was requiring automakers operating in the country, including foreign-owned companies like Tesla, to transmit real-time data on drivers of “alternative energy vehicles” to government monitoring centers. Here’s betting Chinese mandarins don’t want this data only to nab speeders.
Enter the Commerce Department, which in March launched a national-security investigation into vehicles that connect to the grid and other critical infrastructure and that are designed, developed or manufactured by foreign adversaries. “Connected vehicles from China could collect sensitive data about our citizens and our infrastructure and send this data back to the People’s Republic of China,” Mr. Biden warned as he ordered the probe. “These vehicles could be remotely accessed or disabled.”
Pervasive data sharing of sensitive information, the Commerce Department warns, reflects the Chinese government’s “broader approach to co-opting private companies—one that raises significant concerns about how the PRC government might exploit the growing presence” of Chinese-made vehicles in foreign markets.
Chinese electric passenger cars haven’t penetrated the U.S. market in part because of 25% tariffs. American consumers also haven’t warmed to EVs. But businesses and governments are spending hundreds of millions of dollars to electrify their fleets to meet their CO2 emissions goals. Many are now turning to Chinese EV manufacturer BYD.
BYD ranked as California’s top seller of electric trucks in 2022 and second in buses, mostly used by public-transit agencies, ports and airports. A congressional investigation this year revealed suspicious cellular modems in Chinese cranes at U.S. ports. Don’t think Chinese electric trucks pose the same risks?
You don’t have to be paranoid to wonder whether Beijing has egged on the West’s climate obsession because Chinese leaders view green technology as a tool they can exploit. Some of the technology’s national-security risks can probably be mitigated, but not when the government is putting the pedal to the metal.
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Second of the day:
Biden’s Order: Let There Be Electric Trucks
EPA’s latest EV mandate is the most costly and fanciful to date.
By The Editorial Board
Updated March 31, 2024 5:43 pm ET
The Environmental Protection Agency chose Good Friday to roll out its burdensome electric truck mandate, no doubt so fewer people notice. Biden officials well know the damage they are doing, but the damage in the name of climate change is the point.
EPA’s new emissions standards for heavy-duty trucks will effectively require that electric semi-trucks make up an increasing share of manufacturer sales from 2027 through 2032, similar to its recent rule for passenger cars. The difference is that the truck mandate is even more costly and fanciful.
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EVs make up less than 1% of U.S. heavy-duty truck sales, and nearly all are in California, which heavily subsidizes and mandates their purchase. EPA’s rule will require electric models to account for 60% of new urban delivery trucks and 25% of long-haul tractor sales by 2032. The harm is predictable in return for no climate benefit.
***
Start with the fact that no electric long-haul tractors are currently in mass production. Most electric trucks can’t go more than 170 miles on a charge. Electric semis require bigger and heavier batteries, which means they must carry lighter loads to avoid damaging roads. Fleet operators will have to use more trucks to transport the same amount of goods.
This will increase vehicle congestion, especially around ports and distribution centers. EPA says its rule will reduce pollution in “environmental justice” communities near major truck freight routes. But more traffic will result in more pollution. Electric trucks also generate more soot from their wear and tear on roads and vehicle braking.
Power generation and transmission will have to massively expand to support millions of new “zero-emission” trucks. An electric semi consumes about seven times as much electricity on a single charge as a typical home does in a day. Truck charging depots can draw as much power from the grid as small cities.
By 2030 electric trucks are projected to consume about 11% of California’s electricity. The additional power to fuel electric trucks won’t come from renewables, which can’t be built fast enough to meet demand. Most trucks will recharge at night when solar isn’t available since drivers don’t want to waste prime daylight driving hours.
Some 1.4 million chargers will have to be installed by 2032 to achieve the EPA’s mandate, about 15,000 a month. This will require major grid upgrades when there are shortages of critical components such as transformers. It could take three to eight years to develop transmission and substations in many places to support truck chargers.
Truckers estimate the EPA rule will cost utilities $370 billion to upgrade their networks. On top of that, truckers will have to invest $620 billion in their own charging infrastructure. This doesn’t include the cost of electric trucks, which are typically two to three times more expensive than diesel cabs.
Replacing diesel trucks with electric will cost the industry tens of billion dollars each year. Truckers will pass on these costs to customers—meaning U.S. manufacturers and retailers—which will ultimately pass them on to Americans in higher prices. This is President Biden’s trickle-down economics.
EPA says its big-rig quotas are feasible because the Inflation Reduction Act and 2021 infrastructure law include hundreds of billions of dollars in subsidies for EVs. This includes a 30% tax credit for charging stations, $40,000 tax credit for commercial EVs, and a tax credit for battery manufacturing that can offset more than a third of the cost.
IRA tax credits for electric trucks aren’t conditioned on the source of battery material, so expect most to come from China. By the way, China’s BYD was California’s top-selling electric truck maker in 2022. Biden officials say Chinese green-technology manufacturers are flooding the U.S. market, but their mandates and subsidies are the reason.
Cue U.S. truck manufacturers, which are pleading for more handouts. “The EPA’s new heavy-duty emissions rule is challenging,” Ford said on Friday, noting they will require more “incentives and public investment.” So the Administration uses subsidies to justify a burdensome mandate, which then causes companies to lobby for more subsidies. What a racket.
Here’s another one: EPA projects its rule will “avoid” one billion metric tons in CO2 emissions from 2027 through 2055—about as much as emissions from China and India rose last year alone. The truck mandate will do nothing to reduce global temperatures.
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https://www.byd.com/us
I advise refuse ALL cookies and don't search too much of the site :wink:
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A Biden policy that doesn’t survive scrutiny on any level:
https://wattsupwiththat.com/2024/04/03/the-incredible-dumbness-of-bidens-war-on-lng/
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FO
(3) AIRBNB WARNS ABOUT POSSIBLE SUMMER UTILITY OUTAGES: Property rental broker Airbnb sent out an email revising its “Major Disruptive Events Policy” to cover “foreseeable weather events” that result in government travel restrictions or major utility outages.
“North American electricity supply has become practically inseparable from the natural gas supply chain,” North American Reliability Corporation (NERC) Director of Reliability Assessment and System Analysis John Moura said.
Why It Matters: The NERC has increasingly warned over the last three years about power shortages and possible blackouts during the high-demand summer season. Declining power generation capacity due to liquid natural gas (LNG) and coal power plant closures and long-term LNG supply constraints will very likely increase U.S. power shortages in the long term. – R.C.
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When speaking of damage done by "extreme weather," an alarmist dog whistle meant to connote a carbon culprit, they breathless hypesters rarely note that both inflation and population concentration increases can also more than explain increased insurance payouts for weather events. This piece notes the unshared, oft changed, and irreproducable data has problems beyond inflationary and other pressures:
EXCLUSIVE: ‘Blatant Violations’: Watchdog Challenges Key Data Used By Biden Admin To Push Sweeping Climate Agenda
President Biden Delivers Remarks On His Administration's Efforts To Combat Climate Change
(Photo by Win McNamee/Getty Images)
Daily Caller News Foundation logo
NICK POPE
CONTRIBUTOR
April 03, 2024
A government watchdog group has filed a complaint with the Biden administration over its use of a dataset frequently used to push its climate agenda.
Protect the Public’s Trust (PPT) filed the complaint with the Commerce Department over the National Oceanic and Atmospheric Administration’s (NOAA) “Billions Project” dataset, which purports to keep track of natural [and climate] disasters that have caused at least $1 billion in damages going back to 1980. The billion-dollar disasters (BDD) data — cited frequently by the Biden administration to insinuate that climate change is intensifying and justify sweeping green policies — is based on opaque data derived from questionable accounting practices, PPT alleges in the complaint.
“American families and businesses continue to struggle with persistently high inflation, which many attribute in large part to the energy policies and government spending of the current administration. The idea that blatant violations of scientific integrity could be underlying the rationale for these policies should concern every American,” Michael Chamberlain, PPT’s director, told the Daily Caller News Foundation. “Unfortunately, this is far from an isolated incident. The Biden Administration came into office pledging that its decision making would be grounded in the highest-quality science, but all too often has failed to live up to those promises.” (RELATED: The Entire Push To Halt New Natural Gas Exports Traces Back To One Ivy League Prof And His Shaky Study)
The complaint was filed with the Commerce Department, as NOAA operates under its auspices, Chamberlain told the DCNF.
PPT’s complaint alleges that NOAA does not adequately disclose its sources and methods for compiling the BDD dataset, adds and removes BDD events from the dataset without providing its rationale for doing so and produces cost estimates that are sometimes significantly different than those generated by more conventional accounting procedures.
While NOAA states that it develops its BDD data from more than a dozen sources, the agency does not disclose those sources for specific events or show how it calculates loss estimates from those sources, PPT’s complaint alleges.
The complaint further alleges that NOAA’s accounting methods are opaque and “produce suspect results.”
For example, when Hurricane Idalia took aim at Florida in 2023, NOAA initially projected that the storm would cause about $2.5 billion worth of damages before insured losses ultimately came in at about $310 million, according to PPT’s complaint, which cites the Florida Office of Insurance Regulation for that figure. Nevertheless, NOAA subsequently marked up its estimate for how much damage the storm caused to $3.5 billion, a discrepancy for which NOAA provided no explanation, PPT alleges in its complaint.
NOAA researchers have disclosed in the past that the agency considers factors such as functions pertaining to livestock feeding costs — in addition to more conventional types of damages — in their cost calculations.
Further, the complaint alleges that BDD events are quietly added and removed from the dataset without explanation, citing Roger Pielke Jr., a former academic who believes climate change to be a real threat but opposes politicized science. In a forthcoming paper analyzing the merits of BDD statistics, Pielke compared the dataset in late 2022 to the dataset in the middle of 2023 and found that ten new BDD events were added to the list and 3 were subtracted without explanation.
Apart from the issues with methodology alleged by PPT in its complaint, the use of BDD events as a proxy for climate change’s intensity is inherently misleading because economic data does not reflect changes in meteorological conditions, Pielke has previously explained to the DCNF.
For example, increasing concentrations of assets, especially in coastal areas, can confound the usefulness of BDD events as an indicator for the intensity of climate change, as Energy and Environment Legal Institute Senior Policy Fellow Steve Milloy has previously explained to the DCNF. Hypothetically, the same exact hurricane could hit the same exact place, decades apart, with vastly different damage totals; this would be the case because there are simply more assets sitting in the way of the storm, not because the storm was any more violent due to worsening climate change.
NOAA has acknowledged this limitation of the dataset in prior communications with the DCNF.
Additionally, NOAA will add disasters to the list retrospectively because it adjusts for inflation, meaning that a hurricane that caused $800 million in damages in 1980 dollars would be added to the list because the damages exceed $1 billion when adjusted for inflation, for example.
The Biden administration has frequently cited the BDD dataset to substantiate its massive climate agenda.
For example, Deputy Energy Secretary David Turk cited the dataset in written testimony submitted to lawmakers in February explaining the White House’s decision to pause new approvals for liquefied natural gas export terminals.
The BDD statistics are also referenced Fifth National Climate Assessment (NCA5), the Biden administration’s landmark climate report that is intended to provide the most sound scientific basis for lawmakers and officials to craft climate policy.
NOAA asserted that the increasing frequency of BDD events is a sign of intensifying climate change in a January press release and blog post summarizing 2023, and then defended the use of the dataset in subsequent communications with the DCNF.
“Sensational climate claims made without proper scientific basis and spread by government officials threaten the public’s trust in its scientific officials and undermines the government’s mission of stewarding the environment,” PPT’s complaint states. “It also poses the danger of policymakers basing consequential government policy on unscientific claims unsupported by evidence.”
NOAA declined to comment, citing the active nature of the scientific integrity complaint. The White House and the Department of Commerce did not respond immediately to requests for comment.
https://dailycaller.com/2024/04/03/exclusive-watchdog-challenges-key-data-used-by-biden-admin-to-push-sweeping-climate-agenda-noaa/
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"A Biden policy that doesn’t survive scrutiny on any level."
- That line could apply to SO MANY Biden policies, maybe all of them:
The Afghan Withdrawal. Billions to Iran. The Southern border. The crazy spending. The inflation. Israel policy. The war on energy. The EV mandate push. Killing the pipeline. Nuclear closures. Shipbuilding delays. No restrictions abortions. Letting criminals run free. Buttigieg in charge of the bridge? Kamala in charge of the border? Trans men and boys competing with women and girls. And yes, the LNG export ban. It's all nuts. And they want us to find common ground?
"Incredible Dumbness"? My eyes read it, incredible dumbass.
Democrats rejected Sanders and Warren in 2020 for being too extreme to get elected. Only Joe the moderate could beat Trump. Voters were sold one thing and got something different. And now they revolt - I hope.
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https://www.americanexperiment.org/how-to-destroy-the-myth-of-cheap-wind-and-solar/
https://www.powerlineblog.com/ed-assets/2024/04/Screenshot-2024-04-03-at-5.39.26-PM.png
[LCOE Levelized Cost of Energy is a measure that includes some costs and omits others in order to show a desired, misleading result.]
LCOE estimates can make wind and solar look cheap, so long as you ignore most of the costs of integrating them on to the grid and backing them up.
Comparing LCOEs makes sense when examining reliable, dispatchable power plants because these power plants can be turned on or off to meet electricity demand. It makes very little sense when you start including intermittent and weather-based energy sources that don’t provide the same value as thermal generators.
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.
Our modeling attempts to provide this apples-to-apples comparison of running a reliable grid with dispatchable energy sources like coal, natural gas, and nuclear versus that of intermittent facilities like wind and solar. In every case, the answer is clear: wind and solar are by far the most expensive.
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https://www.americanexperiment.org/how-to-destroy-the-myth-of-cheap-wind-and-solar/
https://www.powerlineblog.com/ed-assets/2024/04/Screenshot-2024-04-03-at-5.39.26-PM.png
[LCOE Levelized Cost of Energy is a measure that includes some costs and omits others in order to show a desired, misleading result.]
LCOE estimates can make wind and solar look cheap, so long as you ignore most of the costs of integrating them on to the grid and backing them up.
Comparing LCOEs makes sense when examining reliable, dispatchable power plants because these power plants can be turned on or off to meet electricity demand. It makes very little sense when you start including intermittent and weather-based energy sources that don’t provide the same value as thermal generators.
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.
Our modeling attempts to provide this apples-to-apples comparison of running a reliable grid with dispatchable energy sources like coal, natural gas, and nuclear versus that of intermittent facilities like wind and solar. In every case, the answer is clear: wind and solar are by far the most expensive.
An understandable and damning piece, Doug. Any idea what the difference between “natural gas CC” and “natural gas CT” is? Substantial cost difference shown in the graph and I’m trying to account for it.
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I had the same question while posting that.
From the links below:
"Natural gas can be burned to produce electricity in a traditional combustion turbine (CT) power plant or a more modern and efficient combined cycle (CC) power plant.
A combined cycle power plant is a modern electrical generating plant that captures the energy from burning natural gas in two ways.
First - the gas turbine burns fuel and generates electricity:
The gas turbine compresses air and mixes it with fuel.
The mixture is ignited, creating an explosion that propels the very hot gas through the turbine.
The hot gas spins the gas turbine blades which rotates the turbine shaft.
The fast-spinning turbine shaft drives a generator that converts the spinning energy into electricity.
Second - the steam turbine utilizes the waste heat from the gas turbine exhaust that would otherwise escape through the exhaust stack to create additional electricity:
A heat exchanger captures exhaust heat from the gas turbine and boils water to create steam.
The steam spins the steam turbine blades which rotates the turbine shaft.
The steam turbine shaft drives a generator that delivers additional electricity.
This is the most efficient type of fossil fuel power plant. By combining these two systems, the overall net efficiency of the combustion process can be increased by 50 - 60 percent. Thus, from an overall efficiency of about 35% in a single cycle system one can achieve to an overall efficiency of 50-60% in a combined cycle system.
Either a single shart or multiple shaft configuration can be used for the combined cycle plant. In a single shaft system, the gas and steam turbines turn a common shaft with a single generator. This is the most efficient configuration. However, in larger plants it is more economical to have multiple gas turbines and a single steam turbine.
For large-scale power generation, a typical gas/steam turbine set would be a 270 MW gas turbine coupled to a 130 MW steam turbine giving a total of 400 MW. A typical power plant might consist of between 1 and 6 such sets. GE currently manufactures the largest gas turbine available at just over 500 MW."
https://www.ourworldofenergy.com/vignettes.php?type=electrical-power-generation&id=15
https://www.ourworldofenergy.com/vignettes.php?type=electrical-power-generation&id=9
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I had the same question while posting that.
From the links below:
"Natural gas can be burned to produce electricity in a traditional combustion turbine (CT) power plant or a more modern and efficient combined cycle (CC) power plant.
A combined cycle power plant is a modern electrical generating plant that captures the energy from burning natural gas in two ways.
First - the gas turbine burns fuel and generates electricity:
The gas turbine compresses air and mixes it with fuel.
The mixture is ignited, creating an explosion that propels the very hot gas through the turbine.
The hot gas spins the gas turbine blades which rotates the turbine shaft.
The fast-spinning turbine shaft drives a generator that converts the spinning energy into electricity.
Second - the steam turbine utilizes the waste heat from the gas turbine exhaust that would otherwise escape through the exhaust stack to create additional electricity:
A heat exchanger captures exhaust heat from the gas turbine and boils water to create steam.
The steam spins the steam turbine blades which rotates the turbine shaft.
The steam turbine shaft drives a generator that delivers additional electricity.
This is the most efficient type of fossil fuel power plant. By combining these two systems, the overall net efficiency of the combustion process can be increased by 50 - 60 percent. Thus, from an overall efficiency of about 35% in a single cycle system one can achieve to an overall efficiency of 50-60% in a combined cycle system.
Either a single shart or multiple shaft configuration can be used for the combined cycle plant. In a single shaft system, the gas and steam turbines turn a common shaft with a single generator. This is the most efficient configuration. However, in larger plants it is more economical to have multiple gas turbines and a single steam turbine.
For large-scale power generation, a typical gas/steam turbine set would be a 270 MW gas turbine coupled to a 130 MW steam turbine giving a total of 400 MW. A typical power plant might consist of between 1 and 6 such sets. GE currently manufactures the largest gas turbine available at just over 500 MW."
https://www.ourworldofenergy.com/vignettes.php?type=electrical-power-generation&id=15
https://www.ourworldofenergy.com/vignettes.php?type=electrical-power-generation&id=9
Thanks! My quick search mostly returned “closed caption” or “Connecticut” hits so I quit wading through the results. Your deep dive into it here is appreciated?
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I know, in the name climate change let’s battle CO2 by leveling balsa forest carbon sinks for wind turbine blades, all supported by ton after ton of concrete which out-gasses huge amounts of CO2 both in its production and while it cures. That’ll fix the planet:
https://the-pipeline.org/thicker-than-concrete-dumber-than-dirt/?fbclid=IwAR37W4c8U5AUnidHRR7vEk_JlOgafBDZ32WDnUo77ze-QQAp62WeYtSP2Ds
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(2) INDUSTRY WARNS NEW SOLAR PANEL TRADE WAR COMING: The American Clean Power Association and the Solar Energy Industries Association said a major U.S. solar manufacturer will file a petition with the Biden administration, urging the government to investigate solar panel dumping in the U.S. market by Asian manufacturers.
At least one major U.S. solar wafer maker, CubicPV, scrapped plans for a U.S. factory, citing “a dramatic collapse in wafer prices.”
Why It Matters: China is using trade tactics to corner the solar wafer market, which it has used in other key infrastructure sectors, including port cranes, to undermine the U.S. domestic industry. Biden administration loans and grants to build a domestic green energy industry are effectively giving money to the Chinese government since U.S. battery, electric vehicle, and solar makers are reliant on Chinese components and supply chains. The Biden administration is putting pressure on the Chinese tech industry over semiconductors but is signaling reluctance to take stronger steps against China on trade in other industries. – R.C.
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Texas Gets a Spring Energy Scare
The Lone Star State power grid is already swooning and it’s only spring.
By
The Editorial Board
April 15, 2024 5:36 pm ET
Summer is two months away, yet the Texas power grid is already swooning. On Friday the Electric Reliability Council of Texas (Ercot) asked power generators to postpone scheduled maintenance early this week “to help alleviate potential tight conditions” as temperatures rise into the not-so-sizzling 80s.
The grid typically has excess power-generating capacity in the spring owing to mild weather. There’s also an abundance of solar and wind power. This is why plants go off-line for repairs in the spring to prepare for the summer when electricity use surges as people ramp up the air conditioning.
Yet merely warm spring weather is now enough to push the Texas grid to the brink. Tuesday’s high is forecast to be 89 degrees in Dallas and 84 in Houston. These temperatures shouldn’t force grid operators to break a sweat to keep the lights on, but they are.
One culprit is skyrocketing electricity demand from population growth, new data centers and manufacturing plants. A surge in Bitcoin prices has also made cypto-mining more profitable. Many miners located servers in Texas because—get this—they can arbitrage grid crunches to get paid to reduce power usage.
Data centers accounted for about 2.5% of U.S. electricity in 2022 and are expected to make up more than 20% by 2030. Artificial intelligence is magnifying this demand. A web search uses less than one watt of power while an AI-powered search can require 100 watts. Training an AI search uses around 1,000 watts.
The spring grid S.O.S. doesn’t augur well for the summer or the rest of the country. The past winter was one of the mildest on record, which eased the growing strain on the grid. Yet this summer is forecast to be one of the hottest, which means Americans will almost certainly be told to conserve power to prevent outages—i.e., don’t plan on plugging in your Tesla after getting home from work.
One risk is that power-plant maintenance that is delayed or canceled will lead to more plants failing in the summer when they are needed. Better get that emergency generator while it’s still in stock.
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BTW oil has dropped $3-4 in the last few days.
FO:
(1) BIDEN WILL KEEP IRAN OIL FLOWING DESPITE SANCTIONS BILL: Capital Alpha Partners director Jim Lucier said, “Oil traders are nonchalant because they know Biden will certainly sign whatever waivers are necessary to keep Iranian oil flowing into the market just as he is keeping Russian barrels flowing into the market.”
A person familiar with the matter said the Biden administration is still analyzing the Iran sanctions bill, but no impact on oil markets is expected before the fall.
According to Clearview Energy Partners, the sanctions bill, if implemented, would increase global oil prices by $8.40.
Why It Matters: The Biden administration is focused on maintaining energy price stability ahead of the election and is more likely to pursue sanctions against Iran in other sectors like military production to prevent global oil price fluctuations. The Biden administration ran into similar issues with sanctions against Russia, and economic interdependence means the U.S. economy will be impacted by sanctions against foreign adversaries that produce energy or other critical inputs. – R.C.