Weekly Post: Nov. 8-14

CARBON AND CLIMATE

  • Paris Climate Talks
    The Paris climate talks begin in a couple of weeks and some encouraging news from a recent study shows that CO2 emission intensities (on a per capita basis) are decreasing in 11 of the G20 countries. At the same time, the sticky issue of money and financing has moved to the forefront of pre-talk chatter.

Gattie Note: CO2 emissions intensities have been trending down in the U.S. since 1980 as the U.S. economy becomes increasingly efficient in the amount of energy required to generate a dollar of GDP (see figure below, per GDP basis). Regarding the Paris climate talks, this Newsweek article states: “The goal is to raise enough money from taxpayers in the richest countries, and from private investors, to spend $100 billion per year on the effort in poorer and more vulnerable countries, starting in 2020.” They’ll be talking carbon and climate in Paris; but make no mistake, one of the central points of discussion will be money, economic impact, and the financing of energy projects for poorer countries. The U.S., Japan, South Korea and Australia are currently discussing how, or whether, to finance coal technologies in these areas (subcritical, supercritical, ultra-supercritical) because these countries will be looking to follow the example of China and India where coal has generated economic development, albeit with high levels of carbon emissions.
$100 billion per year in a global energy slush fund: The potential is staggering, but ethics will ultimately dictate any semblance of impact.
Regarding Graphic Below: China’s obvious decline beginning in 1978 tells a great story.

Carbon Intensities

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  • Gore Remains on the Global Climate Stage
    Al Gore hosted “24 Hours of Reality” a 24-hour climate change global broadcast put on by the Climate Reality Project. According to Gore, the fifth annual event is “about making sure the people of the world are informed and engaged so that they can make their voices heard in their capitals and at the negotiating table in Paris”. The event was eventually suspended out of respect for the people of France in the wake of terrorist attacks in Paris on Friday, November 13.

Gattie Note: The decision to suspend the broadcast was a class act by Gore. I disagree with his approach to address environmental issues, but he was All-Southern in the move to suspend activities. Gore continues to serve as lightning rod and pitchman for what he may very well see as his legacy issue in life. There is no question that he has been out front on this issue. The planned event was to include plenty of dignitaries and celebrities, including Duran Duran, Elton John, Florence+the Machine, Mumford & Sons, Neil Young, Jon Bon Jovi, Walk the Moon, Morgan Freeman, Ryan Reynolds, Calum Worthy, and Ian Somerhalder, as well as plenty of politicos. Viewers were encouraged to hashtag #WhyImWatching as a way of spreading the word. On a personal note, I only recognized half of the celebrities and chose instead to hashtag #WhyIQuitListeningtoAlGore. The data are obvious enough for me to be able to see that CO2 emissions are increasing. Those same data also point to the origin of those increases and, while many want to say that the origin is humans, the origins aren’t stateside. They’re east of here.
Gore also addressed a group of activists who had convened in Miami to be trained in how to present the climate change slide show in their own countries and communities. In an interview with Politico’s Michael Grunwald, Gore tacked away from his normal apocalyptic outlook on climate change, saying he is now more hopeful and is very much an optimist, saying: “You don’t want to push people into a feeling of hopelessness”. Personally, I’ve never been touched, much less overwhelmed, by any optimism coming from Gore, as the preferred tenor of his communication has been fear, gloom and dread–hardly the methods for motivating society to develop actual solutions to real problems.

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FOSSILS

  • Coal Struggles in a Natural Gas World
    While the tar sands of Canada have hit a wall at the Oval Office, coal continues to struggle while natural gas gets no carbon credit for credit due.

Gattie Note: Coal, once the workhorse for U.S. power generation, is battling natural gas on two fronts: environmental and economics. Natural gas prices are about $2.14/mmBtu, which is actually up a little from the last week of October. Low gas prices, combined with the fact that gas produces about half the CO2 of coal, continue to take market share from coal. Coal prices are dropping, with Central App. at $49/ton and PRB at $11.50/ton. This translates to about $1.96/mmBtu and $0.65/mmBtu, respectively. While this makes coal attractive for power generators, there’s some economic point at which it isn’t economically feasible to mine. This, understandably, has the industry concerned. Keep in mind that natural gas is not currently an export commodity for the U.S., so prices are artificially low. This FERC link gives some examples of global natural gas prices, and they’re about twice what they are in the U.S. While natural gas exports are not prohibited as is the case with oil, there has been considerable pressure on FERC to shorten the process for approving LNG export permits. With such low prices and having half the CO2 emissions of coal, you’d think there would be rejoicing from the environmental community–but you’d be wrong. Sierra Club, has a Beyond Natural Gas movement to complement its Beyond Coal Campaign in spite of continued evidence that sharp reductions in CO2 emissions since 2007 have been due to a greater share of natural gas, not renewables, in power generation; and this can be attributed to innovations in fracking. Most recently, a study by the Manhattan Institute provides additional support for natural gas in this regard. The impact of renewables will be a slower slog, but will eventually make measurable contributions. In the meantime, Sierra Club may see themselves as great champions of the environment, but they’re doing society and the environment a disservice with their adamant opposition to both natural gas and nuclear.
Other bad news for coal came from SaskPower where efforts to design CCS technology for its Boundary Dam Plant ran into some design, operational and cost problems. This appears to involve contractor issues as well. Personally, I continue to hold out hope for CCS as I simply cannot see how the developing countries of this world, which I contend will burn coal, will expand their economies without overloading us with CO2. They can’t do what they need to do with renewables only—anyone who thinks otherwise, in my opinion, is not squaring up with reality.

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  • China, Coal and Carbon
    China continues to build coal plants, but inaccurate emissions data coming out of China are cause for concern.

Gattie Note: A couple of articles in the NY Times and Reuters continue to tell the story of China, its coal capacity and the problems with some of the gaps in its emissions data. China is increasing not only its coal capacity, but also its natural gas, nuclear and renewables capacity. We can say what we want, but, when it’s all said-and-done China’s power generation sector may very well end up with a much more diverse energy portfolio than the U.S., regardless of what comes out of the Paris talks.

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DISTRIBUTED GENERATION

  • You Did That On PURPAs
    Arizona’s Tuscon Electric Power Co. and solar customers continue to battle each other over costs associated with rooftop solar, and Sen. Lisa Murkowski (R-AK) has sent notice to FERC that she would like to revisite PURPA.

Gattie Note: Tucson Electric continues to hold its ground that solar customers should pay the costs associated with fixed assets (wires, poles, etc.) that solar customers utilize when the utility has to purchase and manage electricity generated from the rooftop panels. Tucson Electric says this is resulting in a shift of about $67 per month to non-solar customers. This is commonly referred to as a cross-subsidy as the solar customer’s electric costs are reduced in part as Tucson must purchase electricity from the solar owners. Sierra Club maintains that solar customers should be allowed a free ride on the utility’s network. Others refer to this as freeloading. This could be shaping up as a Miranda-Warning-type benchmark legal precedent issue for the utility sector and it’ll be fought with bayonets fixed by both sides. This Arizona Solar Fight could be billed as: Freeloaders vs. Free-riders. With that said, this week’s rock-n-roll energy song of the week is brought to you by The Edgar Winter Group, with Sierra Club providing backup vocals.
Coincident with this, Sen. Lisa Murkowski (R-AK), and Chairwoman of the Senate Energy and Natural Resources Committee, sent a letter to FERC requesting a technical conference to discuss PURPA, the Public Utility Regulatory Policies Act of 1978. Murkowski’s contention is that the power generation world has changed since 1978 and this act should be reconsidered. As for myself, I’ve long had questions about the modernity of PURPA. It does seem to have outlived its original purpose. In any event, if this gets any traction, you can count on fireworks as the ranking Democrat, Maria Cantwell (D-WA), earlier in the spring raised concerns that Berkshire Hathaway Energy has a hidden agenda in their push to change PURPA. Specifically, Cantwell believes Berkshire’s interests are in the recently formed energy imbalance market.
Sidebar: Imagine that—A politician calling out someone for having a hidden agenda. “Hey Kettle, I’m Pot and you’re black”.

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NUCLEAR

  • White House Holds Summit on Nuclear
    The White House hosted an all afternoon summit on nuclear on November 6, the same day President Obama nixed KXL.

Gattie Note: Choosing November 6, the same day Obama welded shut the KXL pipeline, could be characterized as ironic, coincidental, or even cruel, but it is assuredly politics. Few events unfold in Washington without having been polled, measured, calculated and choreographed for full political impact. No doubt, this nuclear summit was a bone to the energy industry, particularly the power generation sector whose neck EPA has under its hobnail boot. Nonetheless, I’ll take the bait and call this summit at least a little bit encouraging. One particular segment was by Leslie Dewan, a nuclear engineer who co-founded Transatomic Power and is working on developing a molten salt reactor design. Here’s a link to a presentation by Leslie where she discusses the technology. China is also working on these new generation nuclear reactors in partnership with the US DOE. It’s really encouraging to see young engineers in the U.S. committed to nuclear power and pursuing it as a career. We will not meet our environmental and economic development goals without nuclear. Forbes Writer James Conca has a nice summary article on nuclear, the contributions that nuclear has made to carbon reductions, and the importance of nuclear in delivering electricity to developing parts of the world. As the world continues to expand its nuclear fleet, it’s a matter of national security that the U.S. lead in the development of nuclear technology and remain engaged the world’s nuclear activities.

As for viewing the White House Nuclear Summit, it was streamed live and was accessible for a couple of weeks. However, it is no longer on the White House website and only the first hour has been posted to YouTube. Unfortunately, this entire first hour was predominantly a discussion of the Clean Power Plan with Janet McCabe. Actual nuclear power generation experts came on stage later to talk about nuclear power.

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  • Nuclear Struggles Against the Odds
    Meanwhile, nuclear continues to struggle for traction in the muck of cheap natural gas prices, high capital costs and federal regulations that favor renewables.

Gattie Note: The Economist had a good article about the struggles of nuclear in the rich world and it noted that Entergy would be shutting down its 690-MW Pilgrim nuclear plant in Massachusetts. Before the article could even go to press, Entergy announced that it would also be shutting down its 838-MW Fitzpatrick nuclear plant as well. Last December, 2014, Entergy shut down its 620-MW Vermont Yankee nuclear plant. This could be a 10-page post all on its own, but to summarize, these plants simply could not compete in a merchant market with low natural gas prices and subsidies for renewables. This highlights the impacts of a merchant market on long-term power generation as utilities follow spot prices, build cheap generators and subsequently lose energy diversity. God help when natural gas constitutes about 75% of their energy base and something happens to that market through pure economics or by natural catastrophe.
Strong Personal Opinion: This is the Achilles Heel of the merchant market model: near-sighted vision and a disincentive for investment in the only dispatchable, zero-carbon fuel known to man.

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Gattie Note: I’d be fooling myself and nobody else if I tried to expand much on nuclear fusion, and would look completely moronic if I tried to broker a discussion on new plasma confinement states. But, suffice it to say that nuclear fusion is the legitimate holy grail, silver bullet of energy technologies. This is just really cool stuff and I hope my grandchildren get to see it as a power generation resource.

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Gattie Note: This is an aggressive renewable energy (solar, wind, geothermal) project being planned in the western Mojave Desert in California and it’s a very aggressive effort. The master planning began in 2008 and the original DRECP submitted for public review weighed in at six volumes that comprised “6,030 pages divided up into 92 separate PDF documents, and that’s not including the 24 appendices and a number of GIS map shapefiles”. It looks like the document itself could cover the proposed 22-million acre project site. While a modified version of the plan has been developed, reducing it to only several hundred pages, it remains beyond the reach of anyone who isn’t a lawyer or paid consultant. All of this is being done to ensure compliance (environmental and otherwise) across numerous federal agencies and to solicit input from all stakeholders. Consequently, the project remains in the planning stage.
Apparently, time-to-completion for large-scale renewable projects has reached levels normally reserved for nuclear plants.

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  • Great Britain, Scotland Confront Intermittency
    Europe in general has been pursuing renewables aggressively, but not without conseqences. Great Britain and Scotland are facing tough decisions with renewables.

Gattie Note: Great Britain is learning some hard lessons about renewables and intermittency; in particular, that wind and solar capacity factors of 27% and 11%, respectively, were too unreliable. Fortunately, GB is considering the unproven and, currently, costly technology of carbon capture and storage (CCS). Renewables, nuclear, and CCS make good sense for today’s economy as we also wait for the promise of storage to become viable. At the same time, Scotland engineers are warning that Scotland’s “irrational” energy policy, which includes shutting down nuclear and coal plants, will lead to the need for imported electricity. Scotland’s Institution of Civil Engineers said “the debate on energy had to move beyond an ‘ill-informed discourse’ to a more evidence-led approach”. My personal translation of this is that the role of environmentalists and academics has been too influential and needs to be balanced with industry experts who actually generate, transmit and distribute electricity. Environmental advocacy is important, but it needs to restrain itself and refrain from practicing outside its area of expertise. Work with engineers and industry experts—not against them.
All the incentives and subsidies in the world can’t protect the Achilles Heel of renewable energy as a stand-alone power generation resource.
Nuclear fusion–hurry up.
Admission: OK, I used the phrase, Achilles Heel, twice in this post.

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TRIBUTE TO A WORKHORSE

  • An Old Workhorse is Redesigned
    The 400-MW coal-fired Sunbury Power Plant in Pennsylvania was retired last year after 65 years of operation. It is now set to be converted to a 1.1-GW combined cycle plant.Here’s a short video and information on combined cycle power plants.

Gattie Note: Pennsylvania’s coal-fired Sunbury power plant has been shuttered and is being replaced with a 3-unit 1,129 MW combined cycle plant. The original plant started operations in 1949. That’s 65 years of power generation: Class A Workhouse.
As coal struggles for a toehold in the power generation sector it once dominated, coal plant retirements may very well become more frequent. Recently, in Georgia, Plant Harllee Branch down in Putnam County was shut down. This plant had a deep personal meaning to me as it sat on the banks of Lake Sinclair right next to a bridge that I once fished under with my grandfather. We would hang a lantern off that bridge and let it dangle just above the water surface so that the bugs would swarm around it and attract fish. We’d start late in the evening and reel those fish in all night, eventually packing our stuff up and heading to get breakfast together. Plant Harllee Branch generated its first kWhr in 1965 and its last on October 3 of this year. With all that said, I looked up some old documentaries on steam turbines and let myself go back to a day that actually preceded me. A day when things worked…and were allowed to work…. So, here’s a brief (~ 8 minutes) 1946 educational documentary tribute to the heart of America’s greatest engineering accomplishment in the civil sector—the steam turbine and electricity. I imagined myself in grammar school watching this. Amazing how the principles still hold true today.

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LOW VOLTAGE

  • Climate Change: Fart Greater Impact Than You Thought
    Recent studies show that climate change has a negative impact on sex drive, but that seems to be offset by the hope that kangaroo farts don’t have nearly the methane impact as that of cow and sheep farts.

Gattie Note: I maintain that climate change alarmists can connect any given set of dots to climate change. This, however, represents actual scientific studies. Here, researchers show that climate change, particularly during the summer, will reduce the desire for coitus. Who sits around and thinks up this stuff? While that news aligns in the negative impact column, researchers down under offset that gloomy prediction with hard evidence that kangaroo farts offer hope for cow and sheep farmers. If the gut microflora of the kangaroo can be used in the guts of cows and sheep, both of which are premium-grade emitters of methane, then those emissions might be tempered, somewhat. To date, there have been no studies to evaluate the impact this might have on beef and mutton flavor or on the potential constipatory impacts. Kudos to our mates, from the Outback. I’ve been hopping we’d figure out something like this.
Admission: I made up the word ‘constipatory’.

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Gattie Note: The Washington Post—Where the environment is always just this side of the grass.

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  • GOP Rolls Up Its Sleeves on Keystone
    According to The Onion, the GOP has taken matters into its own hands and decided to finish KXL itself.

Gattie Note: Kudos to the Grand Oil Party.

…ilyh…

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