Thursday, September 25, 2008

Big Win for Republicans, Bigger Win for the American People (Potentially)

The end of the congressional moratorium on commercial development of oil-shale is a big win for Republicans who have made this a talking point during this election cycle, and a bigger win for Americans who want a common sense approach to energy production and development of natural resources in the United States.

A congressional moratorium blocking commercial oil- shale development expires Monday, and the Bush administration is moving quickly to script how future exploration will occur.

The Bureau of Land Management plans to issue final regulations by year’s end that will set out factors including what royalty rate companies will pay to lease federal land in Colorado, Utah and Wyoming.

Advocates of removing the ban, along with a ban on offshore oil drilling, rejoiced and declared Monday “American Energy Freedom Day.”

“It was a mistake to put the moratorium in last year, and it would be a mistake to keep it in this year,” said Republican Sen. Wayne Allard of Loveland. “The common-sense approach to ensuring Colorado’s economic future and our nation’s energy independence dictates that we safely, cleanly and efficiently explore and develop our resources.”

No one pretends that either this or expanded off shore drilling will fill all of America’s energy needs in the future, but a rational approach, to me, is a mixed approach that leverages new technologies and techniques to power our economy with everything from natural gas and clean(er) coal to oil shale and petroleum to wind and solar. And throwing in a series of nuclear power plants wouldn’t hurt my feelings, either.

The funny thing is that for this to happen, all it took was for congress to sit back and fail to act. I’m pretty sure there’s a lesson in there somewhere…

Hopefully the restrictions and lease terms put in place by the BLM won’t make it impossible for development on these new resources.

Read the story.

Tuesday, August 05, 2008

Nancy Pelosi Ducks the Issues Like a Pro

I meant to publish this a few days ago, but life intervened and time slipped by. Happens.

Anyway, imagine for a moment that you are the Speaker of the House. Your party has the majority of seats but you won’t let a vote happen on offshore drilling at a time when most Americans are feeling an energy pinch like they haven’t felt since the 70’s. In fact, since that timeframe far exceeds the short attention span of most of us, it would be safe to say that gas and oil prices spiking over the past few years has brought a sense of urgency that could overpower most every other issue in an election year--these new energy costs may not be unprecedented, but they certainly feel like something new.

House Speaker Nancy Pelosi on Sunday ruled out a vote on new offshore oil drilling even as Democratic presidential candidate Barack Obama said he might be open to a compromise that included it.

The scramble over expanded drilling off America’s coasts — ammunition for a weekend of rat-a-tat-tat by the presidential campaigns — underscores the political power of $4-a-gallon gas. Though President Bush and other backers of new drilling acknowledge it wouldn’t directly affect gas prices for years, they have pounded Democrats for opposing the measure, which is now supported by most Americans.

Why do you not allow the vote?

There are only two good reasons that I can think of to duck the vote when your party is in the majority: first, you don’t feel that you have the support of enough of your party to win the vote, or, second, your party isn’t on the popular side of the issue and you don’t want votes going on record when they could change the way people will vote in just a few months. The Democrats have aligned themselves to an increasingly unpopular position--the systematic denial of use of U.S. natural resources--to push a strong alt.energy with no excuses agenda. That argument is a loser when citizens are more concerned about being able to drive to the grocery store (and, hopefully, still afford groceries) than they are about the ideology that undergirds the Democrat’s need to avoid almost any new proposal to drill or mine anything that could be used to maintain or expand our current energy infrastructure. Their opposition extends far beyond the practical--that is, while moving to renewable sources for energy production is admirable and a goal that I support, the practical mind realizes that we won’t get there by dismantling our economy.

Refusal to address energy production in a responsible manner--realizing that natural gas, oil, and coal aren’t actually tools of the devil might be a good place to start--is advocating the destruction of our economy and the punishment of low wage earners who have a harder time dealing with rising energy costs than those of us who actually have a little elasticity built in with higher incomes. Denying the use of our own natural resources is just foolish. Good leadership would understand that we need those resources to help shore up energy production issues and our economy while we come up with a good mixed strategy for energy production in the future.

Of course, I can’t deny that none of our elected leaders have shown much in the way of leadership on the subject over the last few decades and I wonder if either guy auditioning for the office of President will represent an improvement?

One thing the article mentions that deserves to be addressed is the assumption that new drilling wouldn’t affect gas prices today. While renewed offshore drilling wouldn’t directly change gas reserves today, it probably would affect gas prices today--or, at least, in the relatively near future. The price of oil and gas are changed by investor’s expectations of what is going to happen in the future and if they believe that production capacity exceeds demand (and projected growth in demand), then the price will drop. One of the arguments against tapping the strategic reserves (aside from the fact that they should only be released in the most extreme emergencies--and this ain’t that) is that it wouldn’t have much of an effect in the long term because it doesn’t represent new production capacity. It represents a relatively small and temporary influx of product that would do nothing to change future supply or demand issues. Tapping the reserves would probably result in a very short lived dip (albeit a significant one) in oil prices and a small change in gas prices.

Whatever the result to releasing a portion of the strategic reserves, though, it would be short lived. I’d rather have a long term solution to production questions coupled with an aggressive push to address long term demand questions--a push that is already underway thanks to consumers who were seriously spooked by the results of $140+ oil. I sort of doubt that, even if oil prices were to get back below $80/barrel, we will be seeing a return of the SUV as king of the American road.

Oil prices are already easing to below $120/bbl as I write this (you can see the current price here) and show signs of fluttering down even more as the travel season is starting to come to a close, bringing a sense of relief to folks at gas pumps everywhere. While we have this small respite--and a real need for more relief to help pump up the economy and ease the effects that energy costs are having on inflation--we need to address our long term energy needs. Solar cells, wind farms, and bags of wishful thinking aren’t enough right now to power the economy (and don’t get me started on the ridiculous opposition to nuclear power in the US).

Citizens are demanding solutions to our near term difficulties and I believe that they will respond to strong leadership on the longer term questions. Nancy Pelosi has showed, though, that her best strategy involves ducking the issue. At least until the election is over.

Read the story.

PS- While I generally prefer a Republican in the White House, I tend to like Republicans better when they are a minority in the House and Senate. The political theater is more entertaining and the party takes on a rebellious bent. As a majority, though, they simply failed to deliver on the promises made during those years in the minority.

Of course, since I’m largely a fan of gridlock in government--that state where they are so engrossed in their tug-of-war with the opposition that they forget to pass stupid ore even destructive laws under the supposed cover of my best interests--I might be letting my bias show.

Tuesday, May 27, 2008

Congo Oil Sands: Does this Count as Alternative Energy?

While America putzes around refusing to concoct some intelligent energy policy for developing her own natural resources while preparing for future needs, the rest of the world continues to find ways to use those big oil bucks that are being sucked out of our pockets. Which is nice for them.

In a way, it’s nice for us, too: exploration and exploitation of new finds becomes more economically feasible while oil prices are up around “choking my vacation plans” levels like they are right now. In the Congo, a find of oil sands might have been mostly ignored a decade or two ago; right now, though, it means new jobs, a new energy source, and new opportunities for a country that could use the help.

Eni, the Italian oil group, has discovered a large oil sands deposit in the Republic of Congo that is expected to become Africa’s first large unconventional oil development and could hold several billion barrels.

Paolo Scaroni, Eni’s chief executive, said the project, due to begin production in 2011, opened “a new front” in the development of “unconventional” oil.

Unconventional resources, such as oil sands, which have in the past been considered too difficult or expensive to extract, are expected to provide an increasing proportion of the world’s fuel supply in future as conventional reserves run down.

Canada’s oil sands and Venezuela’s Orinoco belt have the world’s biggest known heavy oil reserves. The area to be developed by Eni is on a smaller scale, but is still likely to be very substantial.

Eni has not put a figure on the scale of the resources in its 1,790 square km licence area, but a sample 100 square km area that Eni has studied is estimated to hold 500m to 2.5bn barrels of recoverable oil.

Read the rest.

Wednesday, March 19, 2008

Al Gore Lauds Corporate Advances in the Fight Against Global Warming. Then Totally Misses the Point.

Al Gore recognizes, in a virtual panel discussion on business technology and the environment, that corporations are ahead of governments when it comes to tackling emissions issues.

“Most business leaders are way ahead of political leaders, and that’s good news because once the market shifts, that really starts to make a difference,” Gore said.

Chambers agreed, saying that there has been a “market transition” where many business managers and government leaders are trying to reconcile economic growth with environmental stewardship.

“For the first time, the environment is not just hitting (leaders’ ) radar screen; they also know this is doable with economic growth,” he said.

Then he totally misses the point and continues to embrace economically destructive mandates and the clumsy hand of government over-regulation instead of realizing that the solution is coming to us (although, admittedly, without all the fun political grandstanding that comes with saving the planet from our evil, corporate overlords). The market--consumers and producers--are already addressing emissions issues through a combination of economic and ecological interest.

On the economic side, consumers want energy efficiency because the cost of energy has risen sharply over the last few years and those costs are shaping the way that they shop and build. Producers, on the other hand, have seen their own costs rise for the same reasons--and it’s not just direct energy costs and commodities, the cost increases have crept into things like shipping and printing costs. Working for a publisher, I can tell you that we’re facing a year where we know that our paper, ink, and mailing costs are going to bump significantly--which means that we either pass the increases onto our advertisers, we see our margins shrink, or we find ways to increase efficiency to lower our costs.

To cut those expensive bumps in costs, especially since we’re unlikely to be seeing a barrel of oil at $60 or less any time soon, companies are looking to find new ways to do the same jobs with significantly more efficiency--which means less emissions without the economic pain that an artificial government mandate might leave us. An interesting story on CNet today talks about a new use for a very old technology that could yield significant gains for shipping companies.

Sail power is back.

The MV Beluga SkySails, a cargo ship rigged up with a billowing 160-meter sail from SkySails, used approximately 20 percent less fuel than it would have without the sail during a two-month voyage. Put another way, that’s 2.5 tons of fuel, or $1,000 a day, in operating costs. Beluga Shipping ultimately hopes to save $2,000 a day with the technology.

The ship left Bremen, Germany, on the 22nd of January, sailed to Venezuela, and then headed toward the Norwegian port of Mo-I-Rana, docking on March 13. In all, the ship sailed 11,952 nautical miles. The sail was up, depending on the winds, from between 5 minutes and 8 hours a day.

The point is that businesses and consumers want to solve the same problems that Gore does, although not always for the same reason.

But consumers and producers operate from environmental concern, too, even though the professional protesters would never imagine that it’s so. Al Gore’s troops believe that they have to fight against the corporations and consumers to achieve their positive goal--which is why their focus remains on government action instead of funneling their energy into technology and solutions on the corporate side. The truth is that, in many ways, corporations and consumers have joined the fight voluntarily because they believe either that global warming is as scary as Gore portrays it to be or because they believe the world will be cleaner and better if we reduce our energy use and waste.

I’m in that second camp. Through my thirty-seven years of life, I’ve heard lots of scary warnings from communities of scientists, and those warnings are almost always proven to be overstated hugely. Forgive me for being cynical when they tell me that the world is about to end.

I do believe, though, that inefficiency bleeds growth out of the economy, any metro area would be a more pleasant place with lower emissions, it will be easier to deal with energy demands if we find more clean ways to feed energy into the grid, and it’s awfully hard to want a car that gets poor gas mileage when the price of Regular keeps sucking money out of my wallet like the big, scary NAFTA monster in Ross Perot’s nightmares. Like most people, my desire to cut emissions comes from a combination of beliefs and desires driven by my own personal values (economic and ethical).

My desire to save the world may not be as pure as theirs, but it’s just as useful and results-oriented.

If politicians and scare-mongers like Gore would just stay out of the way, the market will continue to tackle the problems that government can’t.

Read the story.

Friday, October 13, 2006

First Commercial Wave Energy

In the discussion of renewable energy resources, one of the more intriguing potential sources is wave energy. That is, harnessing the energy generated by the waves of the ocean--a reliable and consistent energy. Now, the first commercial wave generation plant is getting ready to go online.

The viability of harnessing waves as a lucrative renewable energy source received a boost last week following the announcement that the world’s first commercial wave energy project will begin delivering wave-generated energy to the north of Portugal later this month.
The first stage of the European Union-funded program, the result of two decades of research at Lisbon’s Superior Technical Institute, will bring the first 2.25 megawatts ashore at Aguçadoura, in northern Portugal, and will power 1,500 homes through the national state run electricity grid system according to an Inter Press Service (IPS) report.
With its geographical position and extensive coastline giving access to the larger and more powerful Atlantic waves, official estimates from Portugal’s State Secretariat for Industry and Innovation have predicted wave power could account for up to 30 percent of the country’s gross domestic product by 2050. Renewable energy experts have determined wave farms in Portugal could yield as much as three times as much energy as that produced by a wind turbine park for the same investment cost.

Energy production with minimal environmental impact and reasonable cost is a beautiful dream; I happen to believe that technologies like this can bring us close to that dream. This has precisely nothing to do with my skepticism about the worst of the global warming alarmists and precisely everything to do with my belief that even something good (clean coal and natural gas energy production, for instance) should ultimately be supplanted by something better (solar, wave, and nuclear energy production, for instance).

Here’s to progress.

Read the story.


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