Tag: "alternative energy"

Fair and Equal Energy, GOP Proposes Ending All Tax Breaks

Senator Mike Lee (R-UT) recently proposed new legislation that would end all $16 billion dollars in subsidies on energy, restoring a free market energy sector.

Ordinarily, when legislation such as this is mentioned it is directed at the renewable sector only, allowing oil companies to retain the billions they receive. However, this bill will end all oil and gas subsidies as well, allowing competition to return to the sector. Now the government will be unable to pick winners and losers in the market.

60 years of energy

Source: “60 Years Of Energy Incentives,” Management Information Services for the Nuclear Energy Institute

Credit: Alyson Hurt/NPR

Since 1950, the U.S. government has provided and astonishing $837 billion for energy development, over half of that being oil and natural gas. However, his bill also reduces taxes for these companies which could prove balanced out in the long run.

This is not the first time something like this has been tried. In 2012, Congressman Mike Pompeo of Kansas attempted the same plan and ultimately was referred to the House Subcommittee on Energy and Power. Senator Mike Lee has quite a few more tricks up his sleeve as he currently has 34 sponsors on the bill. He does have opposition however in that many senate democrats and republicans want to extend biofuel subsidies for at least one more year. In order to have a truly effective bill, all government assistance has to be cut.

While renewables were once viewed as the future of U.S. energy, the recent oil and gas boom has taken over the economy. In 5 years alone, oil production on state and private lands has soared an astonishing 61 percent, and natural gas production has risen 33 percent.

May 05, 2014 | 5 comments | by

Does a State Renewable Portfolio Standard (RPS) Help Promote “Ethical” Energy Production?

Most state governments have instituted renewable portfolio standards (RPS), which require energy producers in the state to use ever higher levels of renewable fuels as sources of energy over time. These standards are usually expressed as a minimum percent of all energy produced in the state. Who knew that RPS might create an ethical challenge for state governments? I will explain.

Currently, 30 states use either mandatory or voluntary RPS to encourage energy producers to invest in technology for using cleaner, renewable fuel sources for generating electricity, rather than investing in new technologies for clean burning of coal and oil. Furthermore, environmentalists are increasingly touting energy generated from fossil fuels as wholly unethical, going so far as to formally ask the Pope to condemn investing in fossil fuel burning energy companies as being sinful. Oh my!

Which makes me wonder: If public policy is designed by a democratic process, does that ensure a more efficient and ethical outcome, relative to the decentralized activity of individuals interacting in a free enterprise system? For example, is the state more efficient when picking the “winners” from among competing energy sources and technologies? Are our elected officials any better than individual consumers and investors at ultimately promoting “ethical” energy production in society?

An article by Gerome Corsi and another by Wayne Root each question whether the recent federal stand-off at Bundy Ranch, a fourth generation family cattle operation in Clark County, Nevada, was really about protecting a newly discovered, sensitive tortoise habitat on this section of federal grazing land, as the federal government has claimed. Regardless of whether one agrees or not with the federal government’s decision to rescind this rancher’s grazing rights, both authors strongly suspect that the BLM’s decision was truly about a certain powerful U.S. Senator from Nevada fighting to gain control ever these federal lands in Nevada for a number of newly proposed solar power plants.

Why? There were strict RPS to satisfy, and Mr. Harry Reid was just making sure that they would be. Indeed, in another article, Corsi notes that 15% of all energy produced in the state of Nevada must be produced by renewable fuels. This number is required to rise to 25% by 2025. These minimums are among the highest across all fifty states for any RPS.

Both authors wonder whether Mr. Reid’s pursuit of ever more renewable energy production trumps any ostensible concerns for habitat preservation. After all, if the tortoise habitat of this particular section of federal grazing land was far too sensitive to allow cattle to continue to grazing and stomping upon it (as they had been doing for 140 years), then why did the federal government suddenly send in loud helicopters and 200 armed officers speeding around in four wheel vehicles to crisscross and tear up the land — just to corral the rancher’s posse of supporters and his meandering cattle? Or maybe they just wanted the land cleared for new Chinese solar panels?

To add to my doubts about governmental ethics in this sad situation, both authors point out that not only does Mr. Reid have a strong political interests in developing these multiple projects to satisfy Nevada’s strict RPS, but his former senior advisor, Neil Kronze, was recently confirmed by the Senate as the new Director of the BLM… which manages the grazing leases on all federal lands.

Corsi further piles on more doubts when he reveals that a BLM document specifically points out how the Bundy Ranch cattle are grazing on lands that are ear-marked for the state’s regional energy mitigation strategy to develop solar energy. Corsi notes this report states that mitigation activities are “not durable with the presence of trespass cattle.” I guess that implies cattle herds and solar panels simply do not mix well. Further, Corsi thinks it is highly interesting that this report no longer appears on the BLM website, despite its being available on internet archive files.

So, I wonder: If the government lies about why it is refusing to renew a cattleman’s grazing rights to federal land, whose eviction was a direct response to artificially created scarcity of renewable energy resulting from strict Nevada RPS regulations, that are specially designed to favor one type of clean energy technology (and its jobs) in one industry over another, is this all ethical?

Perhaps we should consult the Pope…

Apr 28, 2014 | 1 comment | by

Vying for Tesla

In 1978 every person knew that Detroit was the motor capitol of the world, and for good reason as they employed more than 250,000 people. Automobiles began in the North and with it came Ford, General Motors, and Dodge building their world headquarters.

2014 looks vastly different as factories are now automated, most of those workers are now unemployed, and the city shrunk from 1.8 million to a mere 700,000. As the world began to globalize there became a push for financially viable alternatives and now even environmental alternatives. Machine labor replaced human labor, and forced unions out as the remaining worker salaries were far too high compared to the alternatives to the union absent South. The South began an automobile revolution taking in Toyota, Mercedes, and Volkswagen to name a few. However, a new company has risen, and northern states are nowhere on their list of possible destinations.

The first Tesla was sold in 2008 and has since made steady advances to become a household name in the United States. The company has had numerous political problems with their approach to selling vehicles without the need for a dealership license. Tesla has a unique, and somewhat illegal, sales model that sells cars directly to consumers without the need for dealerships. As can be expected, current auto manufacturers and dealers are furious and are spending millions on banning Tesla in their states. While many states such as New Jersey, Arizona, and Texas have banned it, there are four that are biting at the bit to get Tesla to build a factory in their states. With 5 billion dollars, and 6,500 jobs at stake there is a lot to be excited about.

New Mexico. The dark horse in the list of possible locations, New Mexico was originally a candidate for a factory in 2007. However, their incentive package was beaten by California’s at the last minute causing Tesla to pull out of Albuquerque. There were numerous advantages in 2007, but 7 years is a huge difference and other states have climbed to be better potential suitors.

Texas. Currently Texas has banned the sale of Tesla vehicles but it has the second most populated state in the United States. If Tesla wants to move product it must gain Texas as a place where it can sell vehicles. The building of the plant may create the leverage needed to allow the sale of vehicles. Even Governor Rick Perry is an advocate, expressing his support for the opportunity that the plant represents.

Arizona. In the same situation as Texas, Arizona has a ban on the direct sales model created by Tesla and therefore no cars can be sold in the state. Tesla attempted to overturn this policy but it was quickly struck down and no further plans to allow sales are even possible until 2015. Tesla will be looking at the long-term though, as the factory will not even be manufacturing until 2017.

Nevada. Considered the frontrunner in locations for Tesla, Reno, Nevada has immediate access to not only rail systems but a large amount of land and local tech companies ready for positions at the new facility.

A similar situation happened in Alabama when many southern states were fighting for Mercedes. In the end, Alabama offered a huge incentive package utilizing tax breaks and taxpayers dollars to attract the auto giant. Near identical events are unfolding in these states as backroom deals are occurring daily in order to win the bid. While the system is controversial, it outlines the bigger problem. None of these deals would have to happen if barriers of entry were not so tough. Alliance, Texas has seen huge success with their free trade area. Now if only the rest of Texas could get on board.

Apr 28, 2014 | Leave a Comment | by

Power Grid Reliability as Coal Plants Retire

As the Obama administration’s EPA continues to promulgate regulations that will effectively close coal plants, or prevent the construction of new ones, much of the debate over these regulations, and coal in general, has centered on the appropriateness of coal as an energy source — is it too polluting? Will it hurt the environment? Is it worth the cheap cost? Are coal alternatives too expensive?

There has been less focus, however, on the ability of the power grid to meet U.S. demand if more coal plants continue to go offline. While industry groups, states and energy companies have raised these concerns, the American public remains largely unaware of the ramifications of dialing back coal-powered electricity generation.

To much of the general public, the EPA’s regulations are simply making for a safer, happier, cleaner world.

But on April 10, the Senate Energy and Natural Resources Committee held a hearing on the reliability of the electric grid. At the hearing, Senator Lisa Murkowski made a rather astonishing statement: “Eighty-nine percent of the coal electricity capacity that is due to go offline was utilized as that backup to meet the demand this winter.”

The New York Times reported on this issue back in March — noting that it was American Electric Power, a Midwest energy provider that was running 89 percent of its soon-to-be-retired coal plants. And PJM Interconnection, a power grid operator that serves Pennsylvania, Maryland, and Ohio, among other states, set a record for peak energy use this winter season.

Next year is an especially significant year for coal, as April 2015 is when coal plants are required to be in compliance with the EPA’s Mercury and Air Toxics Standards rule. Compliance with the rule effectively means shutting down operations or spending hundreds of millions of dollars to conform — spending that will, of course, find its way into consumers’ power bills. Some parts of the U.S. already saw electricity prices this winter that were a whopping 10 times higher than last year’s average.

If, in order to meet this winter’s energy demands, providers had to use almost all of their coal capacity that is actually scheduled to be retired next year, what is going to happen if we have a particularly hot summer this year? Or another round of Polar Vortexes this upcoming winter, when those plants we relied on are no longer operating?

Mike Duncan of the American Coalition for Clean Coal Electricity echoed Murkowski’s concerns when he spoke with Fox News two weeks ago: “Regulation from five years ago is closing about 20 percent of the coal plants. Regulations being proposed now could close an additional 20 percent of coal plants. And that creates huge stresses — we’re just not ready for anything like that in this country.”

The EPA, of course, insists that reliability is not an issue and that coal will remain viable. But anti-coal groups know better. As a recent FOIA request revealed, the Sierra Club’s John Coequyt (head of the group’s Beyond Coal Campaign) forwarded a news story in an email to the EPA’s own Michael Goo and Alex Barron. The news story carried the headline “Coal to Remain Viable, says EPA’s McCarthy at COAL-GEN Keynote.”

Coequyt wrote just three words above the news story to his EPA friends: “Pants on fire.”

Losing coal would not be as much of a problem if we had a cost-effective, large-scale energy alternative available. But the environmentalist left will not touch nuclear power (an energy source that produces no carbon emissions), and renewables are unreliable and expensive, hardly suited to replace coal. If any coal survives the EPA’s onslaught, electricity will be markedly more expensive, hurting American consumers, especially the poor.

President Obama bragged of his plans to drive out coal in 2008: “If somebody wants to build a coal-fired power plant, they can. It’s just that it will bankrupt them. Under my plan, electricity rates would necessarily skyrocket.”

Those who cheered this plan either failed to realize, or did not care, that it was average, ordinary Americans who would have to, quite literally, pay the price.

Apr 23, 2014 | Leave a Comment | by

Russian Energy Out, American In

The political climate between Russia and the rest of the world has deteriorated significantly in recent weeks. However, unlike the war methodology of the early world, economic sanctions are the new way to hurt countries.

Russia’s economy is largely dependent on natural gas and oil, producing nearly of 70% of total exports in 2012, 32% of which was crude oil. The majority of these exports go to Europe, as they are wholly interdependent on Russian energy. In order to meet the demands of a full Russian blockade on energy, the European Union would need to invest 215 billion dollars to meet their own energy demands. Even though there is a vast natural gas market to be explored by U.S. companies, the required approvals could take as long as 2019. The companies who have submitted approvals to congress are still having to wait the required times for natural gas.

The closest to exporting is the company, Cheniere Energy, Inc, who can begin exporting as early as 2016. Even if U.S. companies were able to export crude, it would serve only as a motivator because it would take just as long to increase production to sustainable levels since the U.S. still imports 2.7% of its GDP in oil. The European Union is almost identical in its imports. However, if the U.S. were to come together with Mexico and Canada a strong partnership could be created a lot sooner.

amount of oil imported

Congress needs to act quickly on allowing permits because of the European Union’s plan to become energy independent. If the U.S. can begin exporting oil and natural gas quickly then the E.U. would be allowed several years of planning before making risky investments. It is also extremely important to note that while natural gas can be moved by pipeline easily to countries such as Mexico and Canada; there currently exists no infrastructure for exporting to Europe. This makes things even more complicated as it would require billions in research and development.

While it may seem farfetched, the possibility of energy exports to Europe has increased in recent weeks. There is currently a bill proposed that would automatically approve all received natural gas export projects. Since Europe does not have free-trade agreement with the U.S., it would open up the market to all approved companies. Europe has a mounting deficit in energy production, and with Russian relations rocky, the outlook for US companies looks extremely promising. There is a strong push in the U.S. to end the 40 year ban on crude oil, which is the most efficient way to handle the mounting European energy crisis. It would allow a stronger partnership between allied countries and increase the amount of crude production in North America. It would also create the incentive needed to allow U.S. companies to explore and produce for global markets, rather than just the United States.

europe natural gas

There is a strong fear that ending the ban would increase domestic prices but this is not true. Not only would ending the ban create nearly a quarter million jobs but there would be a strong push to increase production and supply, which would level prices in the long term.

Apr 09, 2014 | Leave a Comment | by

Hoard and Use Some Resources, Export the Rest

President Obama’s administration approved expanding natural gas exports back in 2011 and 2013. Cheniere Energy Inc’s Sabine Pass facility will begin exporting to countries in 2015, Freeport LNG in 2017 at up to 1.4 billion cubic feet a day of liquefied natural gas and Cameron LNG, LLC has been added this year to export up to 1.7 billion cubic feet a day.

The United States has an abundant amount of natural resources that we are not using and may never use if technology keeps improving our energy consumption. A recent technological advancement, fracking, increased the volume of a number of our energy sources such as natural gas and oil. In a recent NCPA issue brief, the clear advantage fracking is for America’s energy needs are explained:

Just 15 years ago, analysts predicted America had only 60 years of natural gas supplies available at then current rates of use. Today, natural gas consumption is much higher, and fracking has increased estimated reserves to 100 years or more.

The Strategic Petroleum Reserve (SPR) that can hold up to 727 million barrels of crude oil only. Refined oil reserves do not exist in the United States. If our existing refineries went offline, we would have to import refined petroleum products. This defeats the purpose of having an “emergency” stockpile of petroleum reserves. What good is the oil if you cannot use it? There should be a Strategic Refined Petroleum Reserve (SRPR) of at least equal in size for real emergencies.

We have an abundant amount of natural resources that we are not using and may never use. Resources like our natural gas and oil are very valuable and can be easily exported. We would then boost our nation’s economy and have the money needed to improve the technology at a faster rate making our energy use more efficient.

Mar 17, 2014 | 5 comments | by

An Alternative to Uranium

Thorium has been shopped around to renewable energy groups as a valid alternative to both nuclear power and a way to curb CO2 production. Thorium is a common metal often found while mining rare earths such as monazite. Monazite sands normally contain around 45-48% cerium, 24% lanthanum, 17% neodymium, 5% praseodymium, along with a small amount of samarium, gadolinium and yttrium. Thorium contains a minimal amount of radioactivity and is 3 times more prevalent than uranium. The goal is for thorium to harness its potential energy and replace uranium and plutonium in nuclear reactors. The most common type of thorium reactor is the Liquid Fluoride Thorium Reactor (LFTR) that has a freeze plug that allows the radioactive material to flow down into a tank in case of emergencies, creating a far safer alternative to the unsteady nature of uranium or the typical nuclear reactor.

Some Positives:

  • There is four times more thorium in the world compared to uranium and it is cheap than to mine. The U.S. has twice the amount of thorium than uranium.
  • Thorium can utilize recycled plutonium in order to become fissile. This means that we are recycling our reserves of plutonium waste that is given off in nuclear reactors.
  • The United States has the 5th largest thorium deposits in the world, thus leading to the reduction of foreign energy imports such as oil.
  • Thorium is safer in that the liquid actually cools as opposed to plutonium or uranium which stays hot constantly.
  • Thorium creates far less radioactive waste than other contemporary reactors.
  • Thorium can be used 200 times more efficiently than uranium can be.

Some Negatives:

  • The cost of research for thorium is so high that many countries spend millions of dollars in subsidies on stagnant technologies.
  • Thorium still needs plutonium or uranium to operate. Thorium turns into Uranium-233 after it is treated, which can be used to create a nuclear weapon.
  • The market chooses to invest in nuclear power currently because of the immediate payoffs.

Thorium

Regardless of potential payoffs and risk thorium can be looked to as the future of energy. It currently has far more potential than solar or wind and can create vast amounts of energy very quickly. The possibilities of thorium are endless, and some day it could even be used to power planes and cars as easily as gasoline does today.

Mar 10, 2014 | 2 comments | by
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