Tuesday, July 31, 2012

Heat & Drought Drop Nuclear Plant Output To Lowest Level In 9 Years

Wind and solar are not the only generation technologies where weather conditions can impact production.    "Nuclear power production in the U.S. is at the lowest seasonal levels in nine years as drought and heat force reactors from Ohio to Vermont to slow output."  http://www.businessweek.com/news/2012-07-26/heat-sends-u-dot-s-dot-nuclear-power-production-to-9-year-low.


Bloomberg Businessweek goes on to state that nuclear generation was about 2,600 megawatts below the applicable average and at "94,171 megawatts or 93 percent of capacity, and the lowest level for this time of year since 2003."   


At times during the summer, Vermont Yankee has had to reduce output to 83 percent of capacity, and two Exelon plants in Illinois cut power to 80% and 84%. So what is the problem?


Bloomberg quotes David McIntyre, an Nuclear Regulatory Commission spokesman stating: "Heat is the main issue, because if the river is getting warmer the water going into the plant is warmer and makes it harder to cool."  


As Prof Muller documents (see yesterday's posts), the heat is not going away but will intensify in the coming years. Temperatures are up 2.5 degrees in the last 250 years, with 1.5 degrees in the last 50 years, and Muller expects another 1.5 degree increase in the next 20 to 50 years.


Four concluding points should be made.  First, the nation's nuclear plants that 25 years ago struggled to operate at 75% of capacity have achieved truly remarkable levels of capacity performance.  Indeed, today anything below 95% is considered worrying and question provoking.  Consequently the degradation of output caused by cooling water problems is from a very high normal operating average.

Second, the country has excess generating capacity in just about all regions, with the notable exception of Texas.  As a result of this excess capacity around the country, the loss of 2,600 megawatts of nuclear generation to heat problems is manageable, even in the middle of record heat that creates big peak demands.

Third, as temperatures continue to rise decade by decade, the cooling temperature water challenge for the nuclear fleet is going to deepen and worsen.  The loss of nuclear output will likely rise in the coming years and could become a substantial issue for grid operations, in nuclear heavy areas like PJM, the home of Illinois and Pennsylvania, the nation's two biggest nuclear states.

Fourth, the loss of nuclear output almost certainly leads to increases in carbon dioxide pollution, as more coal and natural gas generation predominantly replaces lost nuclear generation.  The loss of nuclear output is a negative for the environment, consumers, and grid reliability.

Finally, it is always true that when some form of generation does not operate something else takes its place.  Saying no to nukes means saying yes to more coal and gas in this case.

Monday, July 30, 2012

Monthly Electricity Scoreboard: Coal Market Share Up To 34%; Gas 31%; Nuclear 18%; & Renewable 14%

After hitting a record low market share of 32% in April, coal reclaimed a small amount of lost market share in May, when coal provided 34% of America's electricity generation, according to the latest EIA data.  www.eia.gov/electricity/monthly/. Yet, coal's May market share was still below its 36% in March.

EIA projects coal to generate 36% of the nation's electricity this year, down considerably from 42% in 2011, which in turn was a large drop from 48% in 2008. Coal and gas are competing intensely and gas is actually challenging coal to be America's leading electricity generation fuel.

In May, natural gas generated 31% of our electricity, a small decline from its 32% share in April. The price of natural gas heavily influences its market share and that of coal. A key tipping point is approximately $2.75 for a thousand cubic feet.

While coal and gas battle it out for the electric generation top spot, nuclear and renewable energy together provide between 30% and 35% of the nation's electricity.  In May, nuclear and renewable energy had market shares of approximately of 18% and 14% respectively. Continued growth, especially in wind and solar generation, makes it likely that renewable energy will become a bigger source of America's electricity than nuclear power within a decade.





Must Read: The Conversion Of A Climate Change Skeptic By Physicist Richard Muller

From the Koch brothers funded, Berkeley Earth Surface Temperature project, Professor Muller in his NYT op-ed of July 28 says:

"Call me a converted skeptic. Three years ago I identified problems in previous climate studies that, in my mind, threw doubt on the very existence of global warming. Last year, following an intensive research effort involving a dozen scientists, I concluded that global warming was real  and that prior estimates of the warming were correct. I'm now going a step further. Humans are almost entirely the cause."

See www.nytimes.com/2012/07/30/opinion/the-conversion-of-a-climate-change-skeptic.html.

Professor Muller goes on to say that temperatures have increased 2.5 degrees Fahrenheit in 250 years, with 1.5 degrees taking place in the last 50 years.  Professor Muller projects another 1.5 degree increase in the next 50 years, but states that temperatures could increase 1.5 degrees in just 20 years, if Chinese growth and energy patterns continue.

Those numbers have major operating implications for the electric industry as well as our environment and economy.  See the posts about cooling water problems caused by record heat.  Put simply, its going to get hotter than the record heat experienced in the last 2 years, and pretty quickly, and there will be substantial impacts, whether or not we are prepared.

Professor Muller is an intellectually honest scientist who rigorously examined and probed the immense collection of data and, as a result, has done a "total turnaround" on the reality of climate change and its causation.  That the Koch brothers funded his work in part is remarkable.


Friday, July 27, 2012

National Shale Gas Production Up 24%: Where's The Ponzi Scheme?

The NYT's Drilling Down Series featured the wild charge that shale gas was a Ponzi scheme and  rooted this  fear, or perhaps hope for some, in the public mind.  Loving attacks on gas production, whether they be true or false mattering not, Rolling Stone Magazine as well rolled with the NYT's Ponzi scheme invention, in its scandal-mongering, fear-inducing writing.

Partially because prominent publications warmly embraced the Ponzi charge, this falsehood will have adherents, no matter what the actual production from shale gas is.  Some folks will even say with a straight face both that shale gas is a Ponzi scheme and so much gas exists that it will destroy renewable energy.  I have heard several times both of those statements in the same conversation.


For those interested in facts and staying in touch with reality, the shale gas production numbers uproot and discard the Ponzi scheme charge.

From May 2011 to May 2012, national shale gas output rose another 24% to reach an incredible 25.58 billion cubic feet per day.  http://fuelfix.com/blog/2012/07/24/u-s-says-shale-gas-output-rose-24-in-may-from-year-earlier/.  The surge in production led to a enormous new supply and a cratering of the gas price as supply outstripped demand, even though gas displaced large amounts of coal generation over the last 12 months.

Shale gas now provides about 37% of America's natural gas, with about a quarter of our shale gas coming from the Marcellus.

And since natural gas provides about 26% of America's total energy, shale gas provides nearly 10% of America's total energy.

Those are big, real production numbers, the very opposite of a Ponzi scheme fraud. But don't expect the NYT or Rolling Stone Magazine to run front page stories saying they were wrong.  Don't expect them to drive a stake through this vampire-like lie that they did so much to promote.  Others will have to labor to undo this piece of damage to public understanding.


Water Problems Stop and Hinder Power Plant Operations In Midwest

One goal of this blog is to identify important facts and trends before they become common knowledge. Recently, we discussed how the rising temperatures and droughts caused by climate change would create increasing water problems for power plants.  Water is for many power plants--especially coal and nuclear--their Achilles Heel.  johnhanger.blogspot.com/2012/07/massive-drought-may-hinder-electricity.html.

This water weakness in July actually stopped at least one power plant from operating in the Midwest at the height of the heat wave, when its cooling water source dropped below its intake pipe. Also, a nuclear plant sought and received a waiver from the Nuclear Regulatory Commission to use 102 degree water for cooling, when its operating permit required that cooling water be no more than 100 degrees.
http://green.blogs.nytimes.com/2012/07/17/so-how-hot-was-it.

Power plants that gulp cool water don't like droughts, don't like record high days, and then record high night temperatures that heat water beyond operating parameters. As we are but one month into this sizzling summer, keeping watch on how water impacts the nation's generation fleet this year will provide key data for grid operators that they must use to prepare for even hotter summers ahead.

Thursday, July 26, 2012

Sweltering Heat Wilts Rejection Of Climate Science: UT Poll Shows Big Moves In Opinion Among Texans, Republicans, Independents

Sweltering heat and record droughts are wilting the opposition to climate science.  Even in Texas.

A new University of Texas energy poll shows that those who reject or deny mainstream climate science dropped to just 15% of the population, down from 15%.  The poll further found that 70% of the public accepts climate science, up from 65% in March, 2012.  http://www.businessweek.com/news/2012-07-18/record-heat-wave-pushes-u-dot-s-dot-belief-in-climate-change-to-70-percent.

Texans and Republicans moved significantly toward acceptance of climate science.  A full 70% of Texans now accept climate change, up from 57% in March.  One of those Texans, however, clinging to the view that climate science is a massive hoax is Governor Perry.  One wonders how much longer Texans will support public officials that trade in such wild, conspiracy theories.

The UT poll also found that a majority of Republicans--53% and up from 45%--support climate science.  That Republican majority has few Republicans in Congress supporting its view. 

Independent voters also saw a big jump in acceptance of climate science, with 72% now supporting, up from 60%.

While the partisan gap between Republicans and Democrats narrowed, it still exists.  Eighty-seven per cent of Democrats accept climate science.  http://www.utenergypoll.com/.

Outside of the Republican party, where those who reject climate science are a large minority but now a minority, the number of those rejecting or denying climate science is dwindling to the point where they are a fringe. 

Marcellus Production Doubles: Now More Than 10% Of US Gas Production & 25% Of All Shale Gas

Marcellus natural gas production soared from May 2011 to May 2012. In fact, it doubled, rising from 3.37  to 6.85 billion cubic feet per day.  Bloomberg News reports that the foregoing and other facts will be reported to Congress on August 1 by the US Department of Energy.  http://fuelfix.com/blog/2012/07/24/u-s-says-shale-gas-output-rose-24-in-may-from-year-earlier/.  


As of May, the Marcellus provides more than 10% of America's gas; has 40% higher production than the Barnett Shale; and produces a tiny bit less than the Haynesville Shale's 6.92 bcf/d. 


Indeed the Marcellus accounts for about 25% of all the shale gas produced in the US, and shale gas provides about 37% of all of America's gas.  


From all angles, the Marcellus is a big, huge deal.  It is the motherload of US gas production and reserves.

The extraordinary Marcellus production jump from May to May took place, despite the gas drilling slowdown during most of that time. Why? More and more gas wells drilled are being hooked to gas pipelines and sending gas to market.  And while new gas well drilling has slowed, it has not stopped.

One big advantage of the massive Marcellus production is that now natural gas in Pennsylvania costs less than it does in Louisiana at the Henry Hub.  See johnhanger.blogspot.com/2012/07/stunning-fact-pennsylvania-gas-price.html.



Hertz Becomes A Power Company: Driving Forward Radical Grid Decentralization

Hertz is joining Walmart and IKEA in becoming a power company, as families and businesses decentralize the grid. johnhanger.blogspot.com/2012/07/walmart-ikea-become-power-companies-how.html

By the end of 2012, Hertz will be operating solar facilities at 18 of its US airport locations and is currently installing 200 plus kilowatt sized solar systems at its JFK and Newark operations. http://www.sustainablebusiness.com/index.cfm/go/news.display/id/23877.

Rich Broome of Hertz was quoted to say: "Even as incentives disappear, the company expects costs for solar power to continue to come down. Solar makes sense for us."

Hertz is trying harder; the sun is rising; and the grid is decentralizing.

Wednesday, July 25, 2012

EPA Ending Water Deliveries In Dimock: Delivers Final Test Results To Homes

The EPA and its water deliveries are leaving Dimock.  The EPA announced today that it had delivered final test results to all homes, including to the 4 for which it had been supplying replacement water.

The press release states in part: "...EPA has determined that there are not levels of contaminants present that would require additional action by the Agency." http://yosemite.epa.gov/opa/admpress.nsf/0/1A6E49D193E1007585257A46005B61AD.

EPA sampling was conducted at 64 private water wells in Dimock.  EPA goes on to say: "Overall during the sampling in Dimock, EPA found hazardous substances, specifically arsenic, barium or manganese, all of which are also naturally occurring substances, in well water at five homes at levels that could present a health concern. In all cases the residents have now or will have their own treatment systems that can reduce concentrations of those hazardous substances to acceptable levels at the tap."

The press release provides no information about methane levels and comes notably not on a Friday during the afternoon.

Stunning Fact: Pennsylvania Gas Price Falls Below Louisiana's Henry Hub

I am old enough to remember the days when energy supplies were running short, especially in the Northeast. Those days were more than 30 years ago.  And at that time, some of our friends in Louisiana and Texas, that had plenty of oil and gas, liked a bumper sticker that said: "Speed and freeze a Yankee."

While the day has not yet come when us Yankees could return the favor to our friends in the South, the day has arrived where our natural gas costs less than theirs.

The Energy Information Administration reports that the decades-long spread between natural gas at the famed Henry Hub in Louisiana and the Columbia Transmission trading point in Southwest Pennsylvania has closed and even reversed.  http://www.eia.gov/todayinenergy/detail.cfm?id=7230.


The huge production from the Marcellus shale has put in the dustbin of history the days when Louisiana and Texas gas was consistently cheaper than gas in Pennsylvania.  Indeed, according to the EIA data, gas in Pennsylvania will be about 10 cents per thousand cubic feet cheaper than at the Henry Hub in 2013 and beyond.


While it was always tough to freeze a Rebel, and just got tougher when Georgia and South Carolina both set all time record high temperatures this summer, we would still welcome our Southern friends moving to Pennsylvania, where they now can enjoy cheaper natural gas.

$2.5 Billion To Repair Crystal River Nuclear Plant Aggravates Duke-Progress Energy Merger Drama

Personalities and leadership styles are drawing most of the attention in the extraordinary drama playing out in hearings of the North Carolina Utilities Commission in Raleigh about the firing of Duke CEO-for-a-day Bill Johnson.  As a result of the intense focus on the people at the heart of the merger soap opera, an example of a nuclear plant causing big costs for shareholders, consumers, or both may get lost.
www.tampabay.com/news/business/former-progress-energy-ceo-says-duke-energy-got-buyers-remorse-over-merger/1241215.

The Crystal River nuclear plant in Florida has not operated since 2009, when cracks were seen in a containment building.  The price tag to bring it back on line climbed, as more was learned about its problems.

At this point, the best estimate of repair and replacement power costs is a painful $2.5 billion. It is a painful number that drives home the special risks of nuclear ownership.

The repair costs for Crystal River could build more than 2,500 megawatts of new natural gas generation, more than two times the generating capacity of the nuclear plant.

Most consumers and business people would readily take brand new natural gas plants that amount to more than twice the size of an old nuclear plant with a history of operational problems.

By any calculation, $2.5 billion is a lot of money and risk to accept.  But that is what Duke did, when it agreed to buy Progress Energy, the owner of the Crystal River plant.

Bill Johnson testified that Duke began to have buyers remorse about the merger, in part over the Crystal River plant, and that his insistence that the merger be completed sowed his board room firing on his first day at work after the merger closed.

But while Duke bought Progress Energy and the Crystal River Plants, the consumers in Florida remain monopoly generation customers with no choice to buy or not.  They cannot fire Duke or the Crystal River plant.

Utility regulators in Florida, not the market or competition, will decide how much of the $2.5 billion bill consumers will pay.  Thank goodness that those days are over in Pennsylvania, since the Commonwealth enacted in 1996 its electricity competition law that ended state-sanctioned generation monopolies and freed electricity consumers to hire and fire their electricity suppliers.

Gas Drilling Slowdowns But Gas Prices Are Rising: At What Price Do Drilling Rigs Head Back To PA?

No doubt booms bring challenges to communities, but most mayors would welcome them compared to the difficulties caused by economic slowdowns or busts.  Gas drilling is not going bust in Pennsylvania, but it is slowing down, and the slowdown negatively affects the economies of communities in the gas fields. See
http://shale.sites.post-gazette.com/index.php/news/archives/24702--derry-well-sites-empty-as-low-gas-prices-stop-marcellus-shale-drillers.

Higher prices will bring back the drilling rigs that have been slowly leaving Pennsylvania since the second-half of 2011.  And gas prices have risen from a low of $1.90 in April to $3.17 yesterday. Less drilling and sweltering, record-setting heat across America, that drives up gas demand to run generation plants, are pushing gas prices back up.

As Erich Schwartzel of the Pittsburgh Post Gazette writes, there is no "magic" price at which drilling rig counts rise in Pennsylvania.  But more companies will increase drilling the closer the gas price gets to $4 and above.

As gas prices rise, natural gas demand will soften, because gas will lose market share to coal generation plants. Gas and coal compete for significant amounts of electricity generation demand, and rising gas prices may hit a coal-imposed ceiling.  Indeed, that may be happening to a degree at yesterday's gas price, and the competition between gas and coal to meet America's electricity demands means the timing of the return of $4 natural gas is uncertain.

As gas drilling slows and rising gas prices allow coal to regain some lost market share, the complicated dance between gas and coal creates diverse environmental and economic impacts. There are winners and losers.  But one thing remains true: gas is cleaner burning.

When gas loses market share, emissions of carbon, mercury, soot, sulfur dioxide, nitrogen dioxide are all going up.






Tuesday, July 24, 2012

Gov. Christie Signs Major Solar Bill: A Tell That He Won't Be Romney's Running Mate

A second generation, gargantuan solar boom is coming to New Jersey.

Governor Christie yesterday signed a major solar bill that accelerates by 4 years the required amounts of solar generation under New Jersey's previous solar renewable portfolio standard. That sounds modest but its impact is not modest at all.

The law insures another major surge in solar construction in New Jersey, starting in 2013.
www.seia.org/news/new-jersey-passes-legislation-stabilize-its-solar-market?utm_source=informz&utm_medium=email&utm_campaign=email.

Current New Jersey law requires a bit more than 0.5% of its electricity to be solar generated, and New Jersey has approximately 750 megawatts of solar installed, ranking it second behind California in solar capacity.

The new law requires a sharp increase in solar quickly.  Indeed, by 2015, New Jersey will have 2.5% of its electricity coming from solar.  To meet that requirement, 2,000 to 3,000 megawatts of new solar installations will be installed in New Jersey.

How big is 2,000 to 3,000 megawatts of solar? At the end of 2011, America had installed about 4,000 megawatts.  Solar is booming across the land, and 3,000 megawatts will be installed in 2012 in all 50 states--smashing the previous national record for annual total solar installations.

This law is a very big deal! Beyond the sharp and quick acceleration of the solar requirement, the law also cuts substantially the amount of the solar alternative compliance payment or ACP.

The bill will have big impacts for the grid and electricity market prices.  It will lower wholesale market prices for electricity and especially peak prices in the eastern PJM region that will offset payment by utility customers of the solar credits.

The bill requires enough generation to be built in New Jersey that it may reduce transmission congestion costs. It will lead to a rush of solar investment and create thousands of jobs. And it will improve reliability of the grid during the peak days of summer demand.

The bill passed with strong bi-partisan support, but it is another tell that Governor Christie will not be the running mate of Governor Romney.  Why?  This bill will be unpopular with national conservatives, despite its use of market mechanisms to meet the required standard.

To read the Philadelphia Inquirer Sandy Bauers' report about the law go to: www.philly.com/philly/blogs/greenliving/.  Make sure to "page down."

AP Debunks Josh Fox's Claim That Fracking Linked To Breast Cancer & Other Falsehoods

Saying something causes breast cancer is like yelling fire in a theater.  It should be only said when true.

Yet, Josh Fox's "The Sky Is Pink" video, an advocacy piece aimed at convincing Governor Cuomo to ban hydraulic fracturing in New York, hurls the explosive charge that shale drilling in Texas is linked to breast cancer. Remember also that Rolling Stone Magazine quickly embraced and promoted the Sky Is Pink Video. johnhanger.blogspot.com/2012/06/josh-fox-rolling-stone-magazine-targets.html.

Unlike Rolling Stone Magazine, the Associated Press looks into Fox's claim that breast cancer rates have spiked in the Barnett Shale in Texas, where intensive shale gas drilling has been done for a decade.
www.sfgate.com/news/article/Experts-Some-fracking-critics-use-bad-science-3726159.php#src=fb.
Here is what Ken Bergos of the AP writes about the claim:

1. "But researchers haven't seen a spike in breast cancer rates in the area, said Simon Craddock Lee, a professor of medical anthropology at the University of Texas Southwestern Medical Center in Dallas."

2. "David Risser, an epidemiologist with the Texas Cancer Registry, said in an email that researchers checked state health data and found no evidence of an increase in the counties where the spike supposedly occurred."

3. "And Susan G. Komen for the Cure, a major cancer advocacy group based in Dallas, said it sees no evidence of a spike, either."

The AP also debunks another wild, false claim spread by The Sky Is Pink Video and Rolling Stone Magazine that gas drilling caused radionuclide contamination of Pennsylvania's streams and drinking water.  It notes that comprehensive testing by the Pittsburgh Water and Sewer Authority, other drinking water suppliers, and the Pennsylvania Department of Environmental Protection found radionuclides in streams and drinking water are at background levels and the water is safe to drink.

Reckless charges like fracking causes breast cancer create two problems.  First, they play with good people's emotions and fears, but may be effective for a time in misleading people.

But eventually the false charges are revealed to be reckless. Truth may catch untruth. And then a different risk emerges.

Exaggeration, hyperbole, false charges can create an overreaction, an environment where real impacts and problems are not taken as seriously as they should be.  It is the "crying wolf" syndrome.

And gas drilling is industrial activity that has impacts and risks that can and should be reduced.  In many cases, natural gas impacts are already low, at least when compared to the water and air impacts caused by other forms of energy production and consumption.

Yet, on issues like methane leakage and gas migration, more work is on-going and better results can be ahead.  Wild, false charges that win headlines and eyeballs ultimately backfire and hinder the on-going necessary work of improving regulations and operations.

PA Drops From 12th To 36th In Job Creation: Gas Jobs Help But More Needed

Pennsylvania is slipping down the state ranks for job creation over the last year, after strong performance in 2010. 

Pennsylvania ranks 36th from May 2011 to May 2012 for job creation, when it ranked 12th in 2010.
http://keystoneresearch.org/publications/research/falling-behind-jobs.  And for more recent periods than the last 12 months, Pennsylvania's ranking is even lower than 36th. From April to June, job creation was approximately zero in the Commonwealth.

Importantly, Pennsylvania had ranked 12th in job creation in 2010 so the recent performance is a major drop in economic performance.  Questions come to mind such as, Why is the home of the Marcellus Shale boom ranking lower in job creation from May 2011 to May 2012 than in 2010?


The slow down in drilling that began in fall of 2011 might be one partial explanation, but massive layoffs--tens of thousands--in education are a bigger factor.  The poor comparative, recent job creation in Pennsylvania is a stark reminder that natural gas jobs are needed--desperately so--but Pennsylvanians require many more jobs than the natural gas industry alone can provide. 


The Commonwealth also must understand that excellent education and training of its people, health of its citizens, world class infrastructure, a clean environment, and research and development are indispensable foundations for job creation and competitiveness.  The hammering of education budgets is especially destructive, both in the short term by destroying tens of thousands of teaching positions and in the long term by undermining the ability of Pennsylvanians to compete in the modern world.

Monday, July 23, 2012

China Nearly Doubles USA's Carbon Emissions: Can Shale Gas Come To The Rescue?

Do you remember when the USA's carbon emissions were higher than any other nation?  You may well, since it was not long, long ago.  China passed in 2009 the USA as the world's largest carbon emitter.


Incredibly, by 2011, China emitted nearly twice as much carbon as America. In just three years, China is close to doubling the US carbon footprint!

China put in the atmosphere in 2011 a huge 9.7 billion tons of carbon, up 800 million tons from 2010.  US emissions were 5.42 billion tons in 2011 and going down.  See the report of the  European Commission's Joint Research Center and the Netherlands Environmental Assessment Agency.
http://uk.reuters.com/article/2012/07/19/us-emissions-global-idUKBRE86I0DG20120719.

As of 2011, China now accounts for 29% of the world's carbon pollution; US 16%; European Union 11%; India 6%; Russia 5%; and Japan 4%.  According to the report, global carbon emmissions added up to 34 billion tons.

China remains overwhelmingly dependent on coal to run its economy, with nearly 70% of its total energy provided by combusting coal.  It is aggressively building nuclear plants as well as wind and solar.

But China still runs on coal. That could change, if China successfully produces its large shale gas resources--possibly the second largest in the world.  


US emissions are falling for a set of reasons, but the displacement of coal and oil by natural gas is the biggest. Indeed, US carbon emissions were back to 1996 levels in 2011 and may drop to 1991 or 1990 levels this year.

At this point, the rest of the world should hope that China can use hydraulic fracturing to produce lots of gas, and that it does so as quickly as possible.  Natural gas will be essential to slowing and reversing the Chinese runaway carbon train.



Kudos To Southern Company For Building America's Largest Biomass Power Plant

America's latest biomass generation plant is its largest.  To make matters better still, the plant is operating, where the juice is needed most--Texas where electricity generators barely are keeping up with demand driven by sweltering heat.

Southern Company constructed the 100 megawatt facility that is selling power to Austin Energy under a 20-year power agreement.  www.bloomberg.com/news/2012-07-18/southern-delivering-energy-from-largest-u-s-biomass-power-plant.html.  The plant runs primarily on wood waste from saw mills.

Hydro, wind, and biomass power plants are the big three of renewable generation but solar is gaining fast on all three.

Friday, July 20, 2012

Stunning Fact: US Shale Gas & Oil Benefits To Reach $1 Billion Per Day

The benefits of the shale revolution keep growing and are extraordinary no matter who does the calculations.   A researcher at Yale university calculated that the net benefits of shale gas were $100 billion per year.
johnhanger.blogspot.com/2012/06/yale-study-puts-shale-gas-net-benefits.html.

And now a new study from Bank America Merrill Lynch calculates the US shale gas and oil revolutions delivered $900 million per day of benefits this April and will reach the incredible $1 billion per day mark. Most of these savings come in the form of lower natural gas and electricity bill savings but also some lower oil costs in the US.


The study also concludes the benefits are more than 2% of the USA's Gross Domestic Product and that the US economy would be in recession, or shrinking, today without the stimulus delivered by lower gas prices.
http://www.usatoday.com/money/industries/energy/story/2012-07-11/natural-gas-finds-lower-energy-costs/56157080/1.  Low natural gas prices and the gas boom are creating desperately needed jobs directly and indirectly.


How low are gas prices in the US as a result of the shale gas boom?  USA Today writes that they are down 90%; one-fourth of the global average price; and one-sixth of the price paid by Japan.  All that adds up to huge savings for consumers and the US economy.

Importantly, the shale gas revolution also demonstrates that major energy savings for consumers and slashing carbon emissions are not incompatible goals. US energy-related carbon emissions were back to 1996 levels in 2011 and will fall probably to 1991 or even 1990 levels this year, because lower carbon natural gas is displacing higher carbon coal and oil.

And substituting natural gas for coal or oil is not by any means the only way to save money and cut carbon pollution.  Energy efficiency is still another large way to both reduce costs and cut heat trapping gas emissions.

Indeed, if the study quantified the value of lower carbon emissions, which it does not do, the benefits of the shale gas revolution would be even higher than the soon incredible $1 billion per day mark.

Stunning Fact: Global Renewable Electricity Zooming Up & Soon Will Be 1.5 Times All US Generation

Renewable energy is still principally viewed through an environmental rather than a business prism.

Yet, the global renewable electricity market is an enormous business opportunity for America today and getting bigger.  Just consider the stunning numbers that are included in a recent International Energy Agency study.

Solar generation is zooming from 70,000 megawatts to 230,000 megawatts globally by 2017.  Wind will jump from 230,000 megawatts to 460,000 megawatts again by 2017.

All renewable generation by 2017--hydro, biomass, geothermal, solar, and wind--will be generating 1.5 times current US electricity production.  That is remarkably large, as the US economy remains more than 20% of world GDP.

All the foregoing big numbers are in the International Energy Agency's look at the trends for renewable energy generation around the world over the short and medium term or from 2011 to 2017.  http://www.iea.org/Textbase/npsum/MTrenew2012SUM.pdf.

During the period, the IEA sees US solar capacity increasing another 21,000 megawatts and wind rising 27,000 megawatts. Those are major increases and represent more than $100 billion of investment.

But in comparison to China, the large US investments will be modest.  The IEA projects China will add 104,000 megawatts of wind and 32,000 megawatts of solar.

Hydro that now provides16% of the world's electricity and 80% of global renewable generation will see its share of the renewable energy pie drop to 70%, as a result of the rapid, large increases in wind and solar generation.

From 2011 to 2017, the global growth rate of non-hydro renewables will be 14.3%.  Total renewable electricity will grow 5.8% per year or by 40% by 2017.

These incredible numbers explain why GE, Airproducts, PPG are some of the big Pennsylvania corporate names that are building revenues from supplying the US and global renewable energy markets.


Thursday, July 19, 2012

Exposing Another False Claim Made By Gasland, Rolling Stone Magazine & McKibben: The Truth About The Pollution Of Dunkard Creek

Gasland contains so many errors and false claims that it successfully injected into the public square that years of setting the record straight will be required.  Among Gasland's most successful falsehoods was that gas drilling caused a massive, horrific fish kill on Dunkard Creek, a beautiful waterway flowing from West Virginia into Pennsylvania.

Just this year, Rolling Stone Magazine and Bill McKibben for the New York Review of Books both repeated the Gasland claim that gas drilling caused the Dunkard Creek fish kill in 2009.   Never mind that state and federal agencies have stated that the fish kill was caused by an invasive species, an algae, that thrives in waters with high levels of total dissolved solids.  Never mind that the source of the high levels of total dissolved solids was mining discharges and not gas drilling.

The Gasland Dunkard Creek falsehood keeps marching on and is repeated by important people who should but may not know better.  But now, perhaps, the truth about Dunkard Creek is being rescued with the passage of time.

Don Hopey of the Pittsburgh Post Gazette wrote on Saturday, July 14th an important article that describes the truth of what is polluting still to this day Dunkard Creek.  Hopey's article has received far too little notice so far, but it destroys the claim by Gasland that gas drilling is what ails Dunkard Creek.
www.post-gazette.com/stories/news/environment/dunkard-creek-pollution-affects-mon-river-quality-644643/.

Hopey writes: "High levels of total dissolved solids are polluting the lower five miles of Dunkard Creek, site of a massive 2009 fish kill, and adversely affecting water quality in the Monongahela River, according to state environmental officials."  Not good news, but notice no mention of gas drilling.

Hopey continues: "The high TDS concentrations on Dunkard Creek...are caused by a combination of low stream flow due to drought conditions, abandoned mine discharges and the discharges from Dana Mining's Steele Shaft treatment plants."  Notice again that gas drilling is not fingered as the problem.

The problems on Dunkard Creek, including the 2009 horrible fish kill, are caused by mining discharges and not gas drilling.  Period.  Some of those discharges were in West Virginia but have been addressed. Others are in Pennsylvania.

Dealing with the legacy of mining remains the single biggest challenge to Pennsylvania's water quality, and the problem is complex and hugely expensive.  The story of Dana Mining, the company mentioned in the Hopey piece, underlines just how difficult ending legacy coal mine pollution is.  Indeed, Dana Mining is far from a villain, as one might wrongly infer from the Hopey piece.

Years ago, water levels were rising in the then abandoned mines that Dana Mining is today operating. Prior to Dana Mining commencing operations, the mine water levels were reaching a critical point and were threatening to burst from the earth, sending a deluge of highly acidic, coal mine water into Dunkard Creek.  The result would have been an enormous environmental disaster that would have killed just about everything in Dunkard Creek at that point and below it.

As disaster neared, Dana Mining entered the picture and offered to renew mining, stop the rising mine waters, treat the water for acidity and some other pollutants, and discharge it.  The agreement between the Commonwealth and Dana Mining did not include treatment of the water for dissolved solids--sulfates, chlorides, and so on.  Removing such total dissolved solids is difficult and so expensive that mining would have been uneconomic.

Again had not Dana Mining begun operations, the coal mine waters would have burst forth and have devastated Dunkark Creek.

While TDS when it reaches high concentrations impacts water quality, it is also less devastating to aquatic life than acid mine pollution, so the agreement between the Commonwealth and Dana Mining represented a classic instance of 2 steps forward and 1 backward.  It was better than doing nothing, much better, but it did not solve all the problems impairing Dunkard Creek.

Still another problem for Dunkard Creek has been its use as a propaganda prop in Gasland that detracts from the real issues affecting it.  Hopefully, Hopey's Pittsburgh Post Gazette piece begins to set the record straight and focuses attention on the real issues.


Consol Hits Record Well & Innovates Using Coal Mine Water To Frack A Well

The Marcellus gas reserve is able to remain profitable even at today's low, low gas prices, because production from its gas wells is so large.  And sometimes it is record setting.

Consol reports that a well it drilled in Westmoreland county, Pennsylvania set an all-time company record for peak 24-hour production.  The well produced 17,900,000 cubic feet of gas or 17,900 mcf. http://triblive.com/business/2202097-74/consol-company-drilling-friday-pad-production-rate-record-shale-westmoreland.

Consol last week also made another noteworthy announcement.  It used coal mine water to frack a well or specifically 10% of a well's water needs was met by coal mine water.

Using coal mine water to frack wells is a win-win for the environment by reducing withdrawals of freshwater and by beneficially re-using coal mine water.  



Wednesday, July 18, 2012

Stunning Facts: Power Plants Use 53% Of Water Withdrawn In US and Gas Production Less Than 1% In PA

As droughts grip parts of the USA, and temperatures rise, water becomes more precious.  Conserving water is becoming the top priority in some parts of the nation, and communities across our land pay  growing attention to how water is used.

The U.S. Geologic Survey found that power plants use 53% of water withdrawn for human use from freshwater, surface sources.  www.rivernetwork.org/sites/default/files/BurningOurRivers_0.pdf at page 5. No other use of water comes close to the water needed to operate nuclear, coal, gas, solar thermal, and geothermal plants.

But not all power sources have equal thirsts.  For example, wind and solar PV require none, a major operating and economic advantage for areas where water supply is constrained.

Compared to power plants, gas production accounts for much less of the water withdrawn daily in Pennsylvania.  Water withdrawals amount to less than 1% of the water withdrawn and rank 10th out of the 10 major uses in the Commonwealth.

Having said that, it is also important to state that water withdrawn for gas production should be regulated.  In Pennsylvania, it is. 

A driller must file a water plan with the Pennsylvania Department of Environmental Protection at the time an application to drill is made.  The plan must specify where from where will the water be withdrawn and how much.  It is approved only if the amount of the withdrawal would damage the stream in times of drought.

The Susquehanna River Basin Commission also provides another layer of regulation in its area.  It orders the suspension of water withdrawals when stream flows drop below certain levels.  It has issued such orders currently to gas drillers and other water users.







Global Electricity Storage Systems Increase 8%: Pursuit Of Energy Holy Grail Continues

Economic electricity storage systems would change the operation of the grid, how consumers use electricity, and how electricity is generated so profoundly that pursuing energy storage technology is a Holy Grail.  Just one revolutionary result of economic storage would be the firming of wind and solar power, or reaching the day when the wind never dies and the sun never sets.

New data confirms that the search is being pursued vigorously, as energy storage systems have increased globally by 8% in the first six months, according to Pike Research.
http://www.pikeresearch.com/newsroom/energy-storage-projects-continue-to-increase-worldwide-rising-8-in-the-first-half-of-2012. Pike reports that the number of deployed or announced energy storage systems increased from 600 to 649.

Pump storage and batteries still dominate energy storage, though other technology like fly wheels is being developed.  Pike notes that energy storage projects require government support around the world in order to move forward.

Stunningly, Pike also states that the Asia Pacific region has 60,000 megawatts of energy storage deployed, with China leading the way.

Massive Drought May Hinder Electricity Generation: Water Is An Achilles Heel For Power Systems

Access to water and water that is cool enough to operate power plants could be an Achilles Heel for some power plants and electric systems, as the massive drought gripping 54.6% of the lower 48 states continues. Most power plants don't operate without continuous access to large quantities of water and cool enough water.  Electricity generation cumulatively accounts for more than half of all water usage, so the massive drought could become an obstacle to power production in parts of the USA. 


Risks to power generation rise the longer the drought goes and the bigger the drought grows. Already, the current drought is the biggest in 50 years, according to the National Climatic Data Center.  
http://www.weather.com/news/drought-disaster-new-data-20120715.  The NCDC puts this year's drought among the nation's ten largest of the last century and akin to those of the notorious Dust Bowl.

Power plants can be divided into gulpers and sippers of water.  Nuclear and coal power plants, in particular, use enormous quantities of water for cooling purposes, and the drought may hinder operations, if it persists much longer. johnhanger.blogspot.com/2012/07/gulpers-sippers-ranking-gas-coal-nukes_05.html. Hydro production, of course, falls significantly during droughts, while wind and solar PV do not consume water at all.

As the drought continues and the heat smashes records, another fact to watch is the temperature of water used by power plants to cool. Some power plants cannot use water that becomes too warm and have curtailed operations in the USA, France, and elsewhere as a result. 
johnhanger.blogspot.com/2012/06/study-warns-that-rising-water.html.    

When air-conditioning is maxed during the hottest 100 hours of the year, every possible power plant and demand response resource can be needed to keep air conditioners and lights running. Grid systems are stressed.  And during those peak demand hours, the loss of any generation for any reason endangers reliability.


This drought reminds that the water needs of the various power generation types can be an important factor in determining what plants are best operationally, economically, and environmentally.  In some locations, the supply of water and cool-enough water are as important as capital costs and fuel costs in judging what to build  in the future.



Tuesday, July 17, 2012

Rising World Oil Demand, Despite Global Slowdown, Warns US To Quicken Transition From Oil

The economic headlines from around the world paint a bleak, if not depressing, picture.  China slows; Europe slides deeper into recession; the US economy struggles to maintain 2% GDP growth.  The tenor of economic news would lead many to think that global oil demand is stalled or possibly falling.

Falling oil prices from April to June add to the impression that the world oil markets are becoming safe for consumers. That, however, would be a dangerously wrong conclusion to reach.

Despite economic trouble around the world, global oil demand remains strong and growing.  And growing demand creates upward pressure on price.

According to data from the International Energy Agency, oil demand grew by 700,000 barrels per day in 2011; will rise by 800,000 BPD in 2012; and go up 1 million BPD in 2013 to reach 90.9 million BPD.
http://www.marketwatch.com/story/iea-sees-demand-growing-in-2013-2012-07-12-64855027.

While the oil demand growth rate is a modest approximately 1% per year, the upward trend is real and cumulatively even repeated 1% growth makes a difference over a decade.  And if global economic growth quickens,  world oil demand will quicken too.

Indeed, for the first time ever, the IEA believes that oil demand will be greater in the developing world than in the developed countries.  Economic growth remains higher in the developing world, where the thirst for oil is the principal driver for total global increases in oil demand.

The continued growth in global oil demand, in the face of slow global growth, is a clear warning to US policymakers that transitioning from oil to natural gas, biofuels, and boosting efficiency are imperatives to US economic health.  Even in the best of times, the US economy is weakened whenever oil prices hit $125 per barrel, and the consequences of high global oil prices are even more dire in difficult times like today. Yet persistent global oil demand growth even now almost guarantees that oil prices will be near or in the danger zone for the US economy.


So how is the US doing in transitioning from oil?  Progress is being made but too slowly.  The good news is that oil imports are declining, dropping from 60% in 2005 to 42% in 2011.  Oil consumption has dropped to 1999 levels, as a result of growing use of oil substitutes like ethanol, biodiesel, natural gas, and electricity as well as increasing fuel efficiency of vehicles.


The bad news is that oil remains the top fuel for the American economy, supplying more energy than natural gas, coal, nuclear or all forms of renewable energy, and high oil prices still brake the American economy.



Record Heat Firms Public Opinion About Climate Change But Big Opinion Gap Remains Between Public & Scientists

Record heat, freakish storms and massive droughts may be shaping what a portion of the public believes about climate change. The gap between how credentialed scientists and the public view climate change is not growing, though it remains.  


The firming of public opinion is important. While the overwhelming majority of trained scientists (97%) conclude that rising concentrations of heat trapping gas are raising temperatures, changing precipitation patterns, and acidifying oceans, American public opinion, during 2009-2011, was trending toward more skepticism and rejection of climate science.

New polling data from Stanford University and the Washington Post confirm that the past slide in support for climate science has stopped.  More than 60% of Americans accept that temperatures are rising and want sensible action taken to address the issue. Approximately 25% do not believe climate change is real and reject mainstream science on the issue.
http://www.washingtonpost.com/national/health-science/post-stanford-poll-finds-more-americans-believe-climate-change-is-happening/2012/07/12/gJQAh92wgW_story.html?utm_source=Sightline+Newsletters&utm_campaign=bdb992d578-SightlineDaily&utm_medium=email.

While the public is no longer growing more skeptical of climate science, a big opinion gap persists between scientists and the public. That opinion gap is approximately 37 percentage points.

About 60% of the public and 97% of credentialed scientists--creating a 37 percentage point gap--accept current scientific conclusions that 6 gasses trap heat, the concentrations of those gasses are rising in the atmosphere, that man's activity causes the increase in heat trapping gas, and that temperatures have already risen and will continue to increase, as the concentrations of heat trapping gas escalate.  Moreover, individuals who reject climate science are disproportionately concentrated within the Republican party, a fact of political life with big affects.

Two data points to watch going forward are whether the opinion gap between the public and scientists close and whether climate opinion within the Republican party moves.

Monday, July 16, 2012

Key Facts: Plant Retirements Are A Trickle In 2012 & New Plants Outpace 2 to 1 Retirements

Reading the energy headlines creates the impression that a flood of power plant retirements is underway. For example, EPA rules are often said to be producing large numbers of coal retirements. Yet, during the first 5 months of 2012, plant retirements are a trickle.

EIA data for January to May, 2012 document the retirement of 2,776.7 megawatts of generating capacity of all types.  Just 1,635.5 megawatts were coal plant retirements.
http://www.energybiz.com/article/12/07/dominion-exelon-lead-coal-retirements%26utm_medium=eNL%26utm_campaign=EB_DAILY2%26utm_term=Original-Member.


Indeed, the real news in the retirement data of 2012 are two points.  First, in the first 5 months, approximately 0.25% of US generating capacity and about 0.5% of US coal capacity retired. 


The rate of coal retirements is twice the overall rate of plant retirements but remains low.  If one assumes a useful life of 40 years for power plants, 2.5% of the nation's generation would retire every year.


Not surprisingly, given the slow current rate of retirements, the amount of new capacity that began operating outpaced by 2 to 1 capacity that closed.  More than 5,627.1 megawatts began operation from January to May 2012, with natural gas and renewable energy dominating.


So key questions are, will the pace of plant retirements and new construction change in 2013 and 2014? Ye and here's why.

Based on the approximately 48,000 megawatts of coal plants that owners have announced will close over the next 10 years, the rate of retirements is likely to increase in the coming years.  For example, January 2015 is when the EPA air toxic rule takes effect, unless the courts stop it.

Rising retirements may also be matched by falling new plant generation, with the result that the amount of retirements could equal or even exceed the amount of new plant construction in some years.  That might happen even in 2013, since next year will be a bad year for new wind power that has often accounted for 30% or more of new capacity during the last 5 years.

Other bearish facts for new central station power plant construction are low wholesale market prices, large amounts of excess generation capacity in most areas of the country, rising demand response and energy efficiency, and slow increases in electricity demand.  

Still another challenge to central station power plants--new and old-- is booming deployment of on-site generation technologies like combined heat and power and solar.  For these reasons, the gap between the amount of retirements and new central station construction will certainly narrow and could even reverse in the coming years.







Walmart & IKEA Become Power Companies: How The Grid Is Radically Decentralizing

Walmart and IKEA are powerful examples of the radical decentralization of power production sweeping across the US electric grid as well as the solar boom.  While IKEA and Walmart make money retailing to hundreds of millions of people, both have installed hundreds of millions of dollars of solar at their stores that they have become power companies too.

IKEA has 22 large solar facilities operating and another 17 under construction at its stores around the country.  Cumulatively, IKEA will generate 38 megawatts of solar power.
http://www.renewablesbiz.com/article/12/07/michigans-largest-solar-array-now-plugged-atop-ikea-canton%26utm_medium=eNL%26utm_campaign=RB_DAILY2%26utm_term=Original-Member.

Compared to IKEA, Walmart is doing more, much more, generation at its stores.  As of April 2012, Walmart had installed rooftop solar at 100 of its US stores. www.zdnet.com/blog/green/walmart-reaches-100-on-site-solar-installations/20913.  Indeed, by the end of 2013, it will have 100 stores just in California with rooftop solar operating.

But for Walmart, solar is a commitment from the Pacific to the Atlantic.  It is installing solar at 27 of its 50 Massachusetts stores by this August.  articles.boston.com/2012-05-15/business/31702487_1_solar-panels-solar-power-solar-projects.  The Walmart Massachusetts solar build will total 10.5 megawatts of capacity.

Though I do not have a current total installed solar capacity for Walmart, I would expect it to be around 100 megawatts and rising.  This is an extraordinary number, given that the US had just 500 megawatts of solar installed, as recently as 2008.

The distributed, solar investment of Walmart and IKEA would be notable if they were unique and alone. But they are but two examples of the rush toward grid decentralization and solar generation. Increasingly, the future of America's electric grid and generation is at the premises of and on the rooftops of homes and businesses.


Friday, July 13, 2012

PCN To Air Profile Of Me This Sunday At 7pm

The Pennsylvania Cable Network will air this Sunday at 7pm a 30-minute profile interview with me.  This interview is part of a series PCN does with Pennsylvanians from different walks of life.

In my case, a considerable amount of the conversation turned into a policy discussion of natural gas and energy.  I am sure folks will head inside at the 7pm hour or switch from 60 minutes to catch the conversation.

Key Fact: New Generation Costs Three Times More Than Saving A Kilowatt-hour

Consumers want low-electric bills and a clean environment.  They also demand that the lights stay on.  To achieve those goals requires smart, low-cost investments in our electric system.

The question becomes, what is the lowest cost way of keeping the electricity grid reliable, bills affordable, and pollution reduced? Is it investing in new generation or in saving electricity?  Increasingly, the answer to those questions is major investment on the demand side of the electric marketplace. 


The American Council for An Energy-Efficient Economy (ACEEE) reports that electric utilities made $4.6 billion of investments in energy efficiency programs for consumers in 2010, a more than four-fold increase over the energy efficiency total of $1.1 billion of a decade ago.

One basic fact is driving the increased investment in energy efficiency.  It is cheaper to save a kilowatt-hour than it is to generate a new kilowatt-hour.


ACEEE documents that the cost of saving a kilowatt-hour of electricity is approximately one-third the cost of building new generation.  http://aceee.org/press/2012/06/utility-energy-efficiency-programs-e.


Smart power companies understand that the electric business is much more than building and operating large, distant central station power plants and then running transmission and distribution lines to carry the power to tens of millions of customers.  Energy efficiency, distributed generation, demand response and other services require a different business model but provide opportunity for nimble power companies and their customers.



Stunning Fact: Customer Generated Solar at 122,516 Sites In California Signals Historic Transformation Of Grid


Changing how and where electricity is generated, distributed solar generation is roaring in California.  The California Public Utilities Commission reports that 1,255 megawatts of solar installed at the premises of 122,516 customers is now operating in the Golden State.  And the capacity and customer premises totals are increasing about 25% per year.  The California PUC Report is available here:                                              
http://www.cpuc.ca.gov/NR/rdonlyres/F656D3CA-7724-48FB-81C7-6BDD3AE19CB3/0/SolarReport.pdf.


California is nurturing an historic transformation of the electric grid itself.  And what is happening in California will not stay there. More states will follow.

 Hawaii and New Jersey are pushing forward the distributed generation alternative to the traditional central-station-transmission electric grid with solar but other on-site generation like combined heat and power.  Low-priced gas is fueling CHP commercial gains and improving the economics of fuel cells. If fuel cells make a commercial breakthrough, the transition to a radically decentralized electric grid would reach a tipping point and accelerate greatly.



Thursday, July 12, 2012

Study Shows Wind Could Cut Generation Prices By 25% In Midwest Power Markets

Synapse Energy Economics published a study this May that a build out of wind in the midwest power market would lower wholesale power prices by 25%.  Savings to retail customers would range from $65 to $200 per year.  http://www.renewablesbiz.com/article/12/05/study-midwest-wind-and-transmission-build-out-lowers-power-prices-and-minimally-impacts-rates.

The study is entitled, "The Potential Rate Effects of Wind Energy and Transmission in the Midwest ISO."  The market area includes North Dakota, South Dakota, Nebraska, Minnesota, Iowa, Wisconsin, Illinois, Indiana, Michigan and parts of Montana, Missouri, Kentucky and Ohio.  Currently about 10,000 megawatts of wind operates in these states.

The paper looks at scenarios of adding up to 50,000 more megawtts of wind energy and the impacts of adding such supply to wholesale market prices.  As Bob Fagan, a co-author of the paper states, "The general effect is lowering the clearing price of the market."

The study also includes costs of expanding transmission and finds the consumer savings from lower generation prices exceed increases in transmission costs. 

Wind generation, as well as nuclear plants, solar, and hydro units, bid zero into markets and accept the market cleaing price.  Wind can do so, because its production costs are very low, typically around 0.5 cents per kilowatt-hour.  When wind and other zero bids are enough to meet demand the market clears at zero or can even go negative (see the posting about the strange, real world of negative electricity prices). 

Reviewing Major Study Comparing State Gas Drilling/Fracking Regulation

What are the strengths and weaknesses of state regulation of gas drilling? Do regulatory gaps exist? What can be learned by states from each other?  Resources For The Future (RFF) provides a service by comparatively reviewing state regulations and using an accessible presentation to answer these questions.
http://www.rff.org/centers/energy_economics_and_policy/Documents/Shale_Maps/shale_maps_master.pdf.

RFF's task was difficult because state regulations are voluminous, customized, and different. It is also close to impossible to capture nuances within rules that can be crucial.  Given the difficulty of the task, I not surprisingly found some points that I would recommend be updated concerning the description of Pennsylvania regulation.

For example, on the first "map" that concerns pre-drill water testing, Pennsylvania is reported to either address pre-drill water testing in permits or not regulate it.  Pennsylvania's law on pre-drill water testing is actually found in a statute that was in fact amended just this year. 

Under Pennsylvania statutes, if a gas company does not perform pre-drill water testing of a water well within 2,500 feet of a drilling operation, and if owners of water wells make claims of pollution after drilling takes place, a rebuttable presumption exists that the gas drilling caused the pollution.  The law this year was made stronger by extending from 1,000 feet to 2,500 feet the zone where a rebuttable presumption exists.

Most importantly, regardless of what the law states, pre-drill water testing of water wells even further away then 2500 feet is now almost universal.

The RFF discussion at page 9 of Pennsylvania's setback requirements from water resources misses one important protection.  In November 2010, Pennsylvania enacted a highly protective water buffer requirement for its more than 20,000 miles of High Quality streams in the country.  The rule is not specifically about gas drilling but requires a 150-feet buffer from development of all sorts.  This rule was enacted as part of a broad strenghtening of environmental protections of water supplies that Pennsylvania enacted, as shale gas drilling began.

The RFF paper does correctly identify the lack of regulation of flaring and venting in Pennsylvania.  This is a state regulatory gap that will be addressed by the EPA April 2012 rule gas production air emission rule.

Getting right the content of rules, the words on the page, is but the first step toward professional, independent regulation. Rules then must be enforced.  And most importantly a culture of safety must take root in every company in the industry.  RFF's study contributes to that vital process.



Cornell Professor Cathles Publishes Paper Debunking Howarth

The carbon life cycle wars continue with the formal publication of another paper debunking the work of Professors Howarth and Ingrafea.  This time the stinging rebuke comes from a colleague at Cornell University.

"Replacing coal with natural gas cuts the creation of greenhouse gases that cause global warming, a Cornell University researcher has concluded, rebutting the findings of colleagues at the university" reports Business Week about Cornell Professor Cathles' paper.  www.businessweek.com/news/2012-07-10/cornell-researcher-rebuts-colleagues-on-fracking-leaks.

The paper was published in the journal Geochemsitry, Geophysics, Geosystems.  Cathles is a professor in the Cornell Department of Earth and Atmospheric Sciences.

Other researchers, including from Carnegie Mellon University and Worldwatch Institute, have published studies that reach conclusions similar to Professor Cathles, finding that gas emits about 50% less heat trapping pollution than coal, when both are compared on a full life cycle analysis.

Reducing methane leakage by better operations and by implementing the April, 2012 final EPA rule on air emissions remains an important task.  Yet, the reductions in carbon emissions achieved to date, as gas displaces coal and oil, is stunning. 

America's 2011 energy-related carbon emissions fell to 1996 levels and 2012 emissions could decline to 1990 levels or slightly more.  The biggest driver of these large, quick carbon reductions is the growing use of gas to make electricity.

Wednesday, July 11, 2012

Non-hydro Renewable Electricity Production Up 43% Since 2010

Joining natural gas production in the electricity generation winner's circle is non-hydro renewable energy.

The generation market share of non-hydro renewable electricity is up a stunning 43% during the first 4 months of 2012, when compared to the January to April 2010.  Wind, solar, geothermal, and biomass power plants provided 4.21% of America's electricity generation from January to April in 2010.  Production jumped to 6.00% of the nation's power for the first third of 2012.  http://www.eia.gov/electricity/monthly.

When hydro production of 7.78% is added, renewable power facilities produced 13.78% of our electricity from January to April of 2012.  That matters to keeping the lights on and keeping electricity prices affordable.

Or to put it another way, America's electricity lights would flicker, and electricity bills would skyrocket, without the 13.78% of power supplies provided by renewable energy.

Tuesday, July 10, 2012

PA Electric Generation Rates Back To 1996 Levels, Thanks To Competition & Shale Gas

As a result of competition and shale gas, today's electric generation prices across Pennsylvania are astonishingly low. How low?

Well, how many goods or services are back to 1996 prices?  Not college tuition, health insurance, postage, water rates, sewer rates, cable television charges.  Not milk, bread, corn, wheat, oil, silver, gold.

But electric generation charges are back to 1996 levels for most Pennsylvanians. In inflation adjusted or constant dollars, many residential customers are paying approximately 40% less. Astonishing!

The year 1996 was when Pennsylvania ended the state-granted electric generation monopoly by passing the Electricity Competition and Customer Choice Act.  When the Pennsylvania Public Utility Commission implemented the law and unbundled the 1996 monopoly electricity generation rate into its generation and distribution segments, the amount PECO's residential customers were paying for electricity was 8.6 cents per kilowatt-hour; Duquesne Light customers, in the Pittsburgh region, paid 8.8 cents per kwh; PPL customers throughout central Pennsylvania paid 6.6 cents per kilowatt-hour for generation service.

Today, PECO's residential customers in the Philadelphia area have generation prices of 7.4 to 8.64 cents per kilowatt-hour.  The savings can be as high as 57% in constant dollars, when compared to 1996 generation rate of 8.6 cents per kwh.  And that savings calculation does not count, the 50% off introductory offer, or 4.4 cents per kwh through October, from First Energy Solutions.

On the other side of the Commonwealth, residential customers in the Pittsburgh area of Duquesne Light are paying from 6.8 cents to 9.8 cents per kilowatt-hour for electric generation service.  Those customers who have switched to the lowest priced competitive offer have saved approximately 62% in constant dollars, compared to the 1996 generation rate of 8.8 cents per kwh.  Again, that savings calculation does not include the 50% off introductory offer of 3.8 cents per kwh from First Energy Solutions.

In the PPL service territory that serves Allentown, Scranton, Harrisburg, and large parts of central Pennsylvania, residential customers are paying from 6 cents to 7.99 cents per kwh.  Those customers who have switched to the lowest priced offer are saving about 50%, when compared to the PPL 1996 generation rate.


Competition is also providing consumers with a variety of service plans. For example, Direct Energy is also offering a free-day-of-power service plan that has allowed PPL customers to cut their electricity bills by 30% to 50%.


Savings for commercial class customers like coffee shops, restaurants, beauty salons, big box stores are even bigger than the 40% plus savings of most residential customers.

The combination of booming shale gas production and ending the generation monopoly and allowing competitive electric suppliers to compete for customers yields extraordinary savings for Pennsylvania's electricity consumers.  As a result, unlike most products and services, electricity costs much, much less today than 16 years ago.









New Duke Study Says Brine Migration Natural & Not Caused By Fracking

Researchers from Duke University have published a second study concerning water impacts of gas drilling in Pennsylvania.  Based on 426 samples of groundwater in 6 counties, Professor Jackson states: "These results reinforce our earlier work showing no evidence of brine contamination from shale gas exploration."  today.duke.edu/2012/07/marcellus.

The study found elevated salinity in some samples but concludes that natural causes and not gas drilling produced the raised level.  The research cautioned that natural pathways were a feature of the geology in some areas that could facilitate gas migration if mistakes are made in cementing or drilling. The Duke paper does not identify when, how, or from precisely what geology the salinity came.  The discussion about natural flows and pathways will be controversial.

One reviewer of the paper, Standford geophysicist Mark Zoback said: "Frankly, I think some degree of vertical hydraulic conductivity in the crust over geologic time is reasonable, but why dense brines would rise and mix with near surface aquifers is not clear. [Duke's] supposition 'therefore it implies a greater tendency for leakage from hydraulically fracturing in the shale' is illogical. Production from the Marcellus would lower the pressure and cause flow into the Marcellus, not out of it."

The implication of Professor Zoback's comment is that if natural flow were taking place over geologic time of brine production of that brine would reduce the natural flow.

The paper was authored by Duke professors Jackson and Vengosh and graduate student Warner, appears in the online edition of the Proceedings of the National Academy of Sciences, and was funded by Duke's Nicholas School of the Environment. 

Let's see what the media does with this paper.

Monday, July 9, 2012

Strange Climate & Fracking Actions In North Carolina: Legislature Replays King Canute; Fracking Veto; & Mistaken Overide

Strange governmental actions are pouring out of North Carolina, with one a reminder of King Canute, an English monarch of the 8th century who famously commanded the waves to stop.  Despite his immense royal power, the waves did not obey.  www.inspirationalstories.com/0/91.html.

The majority of the North Carolina Legislature, that is run by dominant Republicans, issued a Canute-like legislative command.  North Carolina planning authorities must ignore rising sea level advice of the science advisory panel of North Carolina's Coastal Resources Commission. http://planetark.org/wen/65831.

Based on 7 studies, including a 2012 US Geological Survey report that found caused sea rise from North Carolina to Massachusetts will be 3 to 4 times the global average, the scientists to the Coastal Resources Commission said the Tar Heel state must prepare for 39 inches of sea level rise by 2100, as a result of climate change.  But most conservatives insist that climate change is not real and that the globe's scientists are engaged in a massive global conspiracy to hoax the world.

Hence, the Legislature's response is to say "not so fast" to the waves and insist that a much lower sea level rise be assumed.  The majority of the North Carolina legislature thinks it is good policy and law to ignore the best science and ordering the waves to obey.

On the other side of the climate change ledger, the Legislature last week also overode a veto by Democratic Governor Perdue of a bill authorizing hydraulic fracturing and shale gas development in North Carolina.  While stating that she believed shale gas can be developed safely, the Governor, nonetheless, said the bill did not contain adequate environmental safeguards.

Pointing to numerous provisions in the bill that commanded protection of the environment, including one that required further Legislative action before fracking permits be issued by the state agency with that responsibility, the Republican leadership was able to override the veto by one vote.  To add to the strangeness, that one vote was mistakenly cast by a new Democratic House member who mixed up the voting buttons, and the Republican leadership would not let her correct her vote.

Now that the shale gas bill is law in North Carolina implementing fully all the environmental protections in it is vital.  North Carolina must also insure that the regulatory agency charged with oversight has the staff and political ability to enforce strongly environmental protections.

While the gas resource in North Carolina is smallish, still speculative to a degree, and may never be produced, developing natural gas supplies is essential, if America is going to reduce further its energy-related carbon emissions that in 2011 fell to 1996 levels.  Stopping natural gas development is a sure recipe for using more coal and oil and reversing the recent sharp decline in America's carbon emissions, as well as raising today's low natural gas prices that are so important to consumers and our economy.

In North Carolina, the Republican controlled legislature, that won't honestly face sea level rise from climate change, overturns a veto from a Democratic Governor, who accepts climate science, but vetoes gas development needed to slow carbon emissions.  These North Carolina facts are stranger than fiction.

Shale Gas Cuts Philly Area Electric Generation Rate By Another 14.7%


"What you are seeing are decreases because natural gas prices are lower," said a spokesman for PECO, as the electric utility cut its default residential electric rate by another 14.7% effective July 1st.
mobile.philly.com/business/?wss=/philly/business/homepage/&id=160072335&viewAll=y.

For the typical residential customer that has not switched to a competitive electric supplier, the latest rate cuts in 2012 add up to $115 of additional savings per year.  Customers who have shopped for electricity and switched to a competitive electric supplier can save another 10% or more.

A total of 451,000 of PECO's 1.6 million customers, including half of commercial and 87% of industrial accounts, have switched to competitive electric suppliers.

For customers that have not shopped, PECO's residential generation rate is now 8.64 cents per kilowatt-hour. www.papowerswitch.com.  That is almost exactly what PECO's generation rate was in 1996, sixteen years ago, when the Pennsylvania Public Utility Commission unbundled or separated the total electric rate into distribution and generation parts.  Today's generation price, or the charge for producing the electricity itself, is more than 40% lower in inflation adjusted or constant dollars than the 1996 generation rate.

To make matters better for the customers of PECO, competitive electric suppliers have offers that are much lower than the PECO default rate.  Competitors are offering electricity for as low as 7.4 cents per kwh.  First Energy Solutions has an introductory offer of 50% off or 4.4 cents per kwh through October 2012 and then a fixed 8.8 cents through December 2013.  That offer comes with a hefty cancellation fee.

What makes these tremendous energy bargains possible?  Competition, the Marcellus Shale, and booming national shale gas production are truly the golden geese for PECO's consumers.



Friday, July 6, 2012

Powering America: The Top 5 Energy Producing States Deserve A Thank You

Pennsylvania is moving up the energy production rankings.

Based on the latest available data, the five top energy producing states in order are: Texas, Wyoming, West Virginia, Louisiana, and Pennsylvania. www.eia.gov/state/seds/sep_prod/pdf/P5.pdf.  That ranking is based upon 2010 data for coal, oil, natural gas, nuclear, and renewable energy production.

When 2011 data is collected, Pennsylvania will jump over Louisiana and West Virginia to become  
the third biggest energy producer, because of a huge increase in natural gas production that took place in the Commonwealth last year.  Among the states, Pennsylvania will soon rank second for nuclear production, third for natural gas, and fourth for coal.

At the other end of the energy production spectrum sits 5 states that produce the least energy.  They are Vermont, Rhode Island, Delaware, Hawaii, and Nevada.   States that produce little energy rely on energy imports from states that produce a great deal to keep their economies and communities functioning.  The interstate commerce of energy is a vital daily exercise all across our land.

Jobs are a major product of that commerce and energy production. The 5 biggest energy producing states all have unemployment rates below the national average, but the same cannot be said about the 5 states producing the least energy.  Rhode Island and Nevada are among the 5 states with the highest unemployment rates, though Vermont enjoys a low rate of unemployment.

Hosting energy production has economic benefits for energy producing states as well as challenges.  Wind farms, nuclear plants, gas production, coal mining, solar systems, biofuels all trigger controversy and sometimes intense opposition to their development because every energy source impacts the environment to some degree.

While battles to stop wind farms or gas production continue, no American stops using energy.  Every American should use energy wisely and be thankful for the energy that comes from America's top 5 energy producing states.




Energy Hogs & Dieters: Ranking The States By Per Capita Energy Consumption

Are Floridians energy hogs or dieters?  How about Iowans?  Or Arizonans?  Ranking the states by per capita energy consumption produces a few surprises.

Floridians and Arizonans are among the 10 states with the lowest per capita energy consumption, while Iowans are among the top energy gulpers.  Residents of Wyoming and Rhode Island rank as the biggest and smallest consumers of energy respectively, according to the latest EIA data.
www.eia.gov/state/seds/sep_sum/html/pdf/rank_use_per_cap.pdf.

Indeed the typical resident of Wyoming uses more than 5 times as much energy as a resident of Rhode Island.  One consequence of heavy energy use is added vulnerability to periodic energy price shocks.  But what factors explain the huge disparity in the per capita energy consumption of those states using the most and least energy.

Plainly, one variable affecting energy consumption heavily is simple distance between places like work and home.  Another factor is the availability of public transportation.  New Yorkers rank second in using the least energy and the excellent public transportation in New York likely drives its ranking.


Weather, building codes, energy efficiency programs run by utilities also impact energy consumption and a state's ranking.

Here are the ten states whose residents use the most energy on a per capita basis:
1. Wyoming; 2. Alaska; 3. Louisiana; 4. North Dakota; 5. Iowa; 6. Texas; 7. South Dakota; 8. Nebraska; 9. Kentucky; 10. Indiana.

The ten states whose resident use the least energy are:

1. Rhode Island; 2. New York; 3. Hawaii; 4. California; 5. Connecticut; 6. Massachusetts; 7. Arizona; 8. New Hampshire; 9. Florida; 10. Vermont.

Pennsylvania is more sipper than gulper of energy, ranking 33rd on states that use the most energy and 17th on rankings for states that use the least.


Thursday, July 5, 2012

Storm Proofing Electric Grid Requires Doubling Electricity Bills: Would That Be Worth It?

The massive outages in sweltering heat have triggered criticism of electric distribution utilities and another round of questioning why electric lines are not buried under ground.  The single biggest reason why electric customers lose service is weather caused damage to distribution lines.  Ice storms, wind damage, tree limbs falling all cause havoc with electricity service and can require days and even weeks to repair service to all customers.

No doubt burying all or most distribution or transmission lines would improve reliability of the electric service, but such improvement would require a doubling of electric bills.  The typical residential electric bill would jump from about 11 cents per kilowatt-hour to 20 cents or more per kilowatt-hour.

Indeed, following a massive storm in 2003, the North Carolina Public Utility Commission studied the possibility of burying electric lines and concluded it would raise electric bills by 125% and require $41 billion of investment and decades of work.

A typical residential customer in the US pays today an electric bill between $100 to $120 per month and so monthly bills would skyrocket to $200 to $240 or more to storm proof the electric grid.  Would that investment be worth it?

A lot of people dealing with 100 degree heat without electricity would say, "Yes, absolutely."  But $1,200 more for electricity would hit hard the pocketbooks of most families.

Moreover, a doubling of grid electric bills would turbocharge investment in solar, CHP, and other on-site generation technologies.  The grid today faces real competition and cannot price itself out of the market.

Finally, utility regulators must always vigilantly monitor the capital budgets of electric distribution utilities to make sure that they are investing appropriately in grid reliability.  The electric distribution utilities remain state-sanctioned monopolies everywhere in America, and their rates and the use of ratepayer money are typically regulated by government officials appointed for that purpose.

Since electric distribution customers have no choice or competition to protect them, utility regulators must provide smart, thorough oversight.  It is a critical and difficult function that requires judgment about how much to charge ratepayers to make the grid ever more reliable.  To date, regulators and utilities have judged that most customers have not been willing to double their electric bills in order to storm proof the grid.


Gulpers & Sippers: Ranking Gas, Coal, Nukes, Wind By Gallons Per Kilowatt-hour

In more areas around the USA and world, water is becoming a constraint on development. That is increasingly true for power generation too.  Indeed, water is joining the capital and fuel costs of a new power plant, as critical variables in deciding what type of power plant to build in various locations.


As with capital costs and fuel costs, power generation technologies vary greatly on how much water they need to operate, whether measured at the power plant or over the lifecycle of the fuel used to make electricity.


According to a new report, natural gas powered electricity requires 1.5 gallons per kilowatt-hour; nuclear power 2.9 gallons per kwh; and coal-fired generation 7.1 gallons per kwh. 
www.rivernetwork.org/sites/default/files/BurningOurRivers_0.pdf

By contrast to gas, coal, and nuclear, wind and solar photovoltaic require tiny amounts of water.  Solar thermal plants, however, are more water intensive.

Tuesday, July 3, 2012

Three New Facts Prove That Banning Fracking Boosts Carbon Pollution & Challenge Environmentalists To Rethink Shale Gas

In 2008, just as shale gas reached a tipping point, moving from small to massive amounts of production in the USA, questions abounded about the impact of shale gas on carbon emissions.  Would shale gas have a big or little impact on the construction of new coal plants?  Would shale gas displace large or small amounts of production at existing coal plants?

Or, if shale gas were stopped, would renewable energy production jump, take the place of gas, and displace coal, as those seeking to ban fracking frequently asserted?

The last 18 months have produced 3 critical energy facts that answer those questions, challenge some environmentalists to rethink, and demonstrate why banning shale gas is environmental folly.

First, coal boomed globally in 2011, with global coal consumption rising 5.4% but falling 5% in North America.  Last year, coal provided 30.9% of the world's total energy, its highest portion of the world's total energy since the 1969.  www.johnhanger.blogspot.com/2012/06/new-data-documents-shale-gas-is.html.

Second, coal generation is booming in the UK, rising to 42% of the UK's total electricity, as cheaper coal displaces expensive gas.  www.johnhanger.blogspot.com/coal-generation-booms-in-uk-displaces.html.  The UK has yet to produce shale gas, though that may be changing. Plainly, renewable energy currently cannot displace coal and oil, even when shale gas is not being produced.

Third, coal generation in the US declined from 48% in 2008 to 32% in April 2012; the US led the world in reducing carbon emissions since 2006; US energy related carbon emissions were back to 1996 levels in 2011 and may fall in 2012 to 1990 levels.  www.johnhanger.blogspot.com/2012/06/climate-change-stunner-shale-gas-makes.html.

Shale gas has displaced huge amounts of existing coal generation and caused the cancellation of more than 100 new coal plants in the one and only place in the world where it has boomed--the USA!   In the USA, natural gas is more competitive than coal, because the price of natural gas has plummeted from $13 to $2 for a thousand cubic feet, as a result of the shale gas boom that now accounts for 37% of gas production

Everywhere else in the world shale gas is not yet being produced for a variety of reasons, including environmental opposition in some cases.  And from China to Western Europe, where shale gas is yet to boom, coal consumption grows.

While renewable energy is growing around the world and in the USA too, renewable energy is not filling the vacuum opened, when natural gas is not an option. Only gas and renewables together can currently displace large amounts of more carbon intensive coal and oil.

Still don't believe it? Again, 2011 globally was coal's best year since 1969!

Saying no to shale gas means using more coal and oil.  It also means rising carbon pollution.  Conversely, using shale gas displaces coal and oil and slashes carbon emissions.

Blocking shale gas is climate folly, at a time of rising global coal and oil consumption.  And responsibly producing shale gas will be essential to cutting carbon emissions and will remain so for the next 20 to 40 years.  The last 18 months of global experience proves these facts.






Wind Generation Jumps 29% in First Quarter 2012: Now 4% Of America's Electricity

George W. Bush set the goal of 20% of America's electricity coming from wind power, and America reached the 4% mark in the first quarter of 2012, when wind power produced 38.4 billion kilowatt-hours of the 960.7 billion total.  www.eia.gov/totalenergy/data/monthly/pdf/sec7_5.pdf.  In short, America is 20% of the way toward President Bush's 20% wind goal.

While new construction of wind power for 2013 is being crippled by Congressional inaction to extend the production tax credit that expires at the end of 2012, recently completed wind farms coming on line are boosting sharply the amount of electricity generated by wind farms. 

In fact, the latest EIA data shows that wind generation rose 29% in the first quarter of 2012, compared to same period in 2011.  www.eia.gov/totalenergy/data/monthly/pdf/sec7_5.pdf.

For the whole of 2012, wind is on course to produce about 150 billion kilowatt-hours, a big jump over the 119 billion kilowatt-hours wind generated in 2011.  Assuming a residential account uses 10,000 kilowatt-hours per year, wind will produce enough electricity to supply 15 million homes this year.