Friday, July 29, 2005

Daily News makes mountain out of molehill on alt-fuel pickups

I am afraid that the editors of the Los Angeles Daily News have lost all sense of proportion. They're complaining about the use of non-alternative-fuel service pickup trucks at the Sunshine Canyon landfill.

Behind closed doors, Planning Department officials effectively voided one of the key environmental protections that Granada Hills residents had fought for. BFI could use the polluting vehicles, so long as it agreed to study the alternatives.

While bemoaning two or three pickup trucks today, the Daily News seems to have forgotten that the alternative to Sunshine Canyon would be to send almost a million one-ton dump trucks some 70-100 miles up the freeway to the Antelope Valley. Somehow, the energy savings the papers is complaining about seem to pale in comparison!

San Diego firm pushes for biofuels

Although alternative energy sources remain cost-uneffective, businesses are cropping up to try to make the breakthrough that changes all that.

At San Diego's Diversa Corp., scientists are working with a $38 million government-and industry-funded consortium to develop a "biorefinery" for making fuel ethanol out of corn and the crop's debris, such as the leaves, cobs and stalks that are usually discarded.

Diversa's task within the consortium, which is lead by DuPont, is to engineer enzymes that can break down the corn and crop matter into sugars, which are converted through a fermentation process into fuel ethanol. Other members of the consortium include Deere & Co., the National Renewable Energy Laboratory and Michigan State University.

The consortium received a backhanded boost this week as Congress finalized a national energy plan for President Bush to sign into law. The House passed the legislation yesterday, and the Senate is expected to approve it as early as today. The proposed law includes tax incentives and credits to encourage the production and use of renewable fuels such as ethanol.

Environmental and alternative-energy advocates have clamored for renewable energy and fuels for years, but the economic incentives and political will to make it happen lagged.

Yet recent events – crude-oil prices that top $59 a barrel and fear of excessive reliance on foreign oil – have helped reinvigorate the renewable-energy movement and win it broad support from business and political leaders.

Energy bill opens forst to redrilling

Although the federal Energy Bill does little to reduce dependence on foriegn oil and ANWR remains off-limits, some California forest land is being opened for drilling through other means.

After a decade of study, the federal government has decided to open 52,000 acres of the rugged Los Padres National Forest to oil and gas leasing.

Although more than half the acreage falls within roadless areas, the decision, announced Thursday by the U.S. Forest Service, bars any surface development in roadless portions of the Los Padres, which includes some of the wildest country in Southern California. Only slant drilling could occur under those areas, from wells on adjacent land.

Public opinion was strongly against any more energy leasing in the 1.76-million-acre national forest, which includes stunning coastal scenery, the watershed for Santa Barbara and habitat for 54 endangered California condors.

Los Padres Forest Supervisor Gloria Brown said she weighed the opposition against her agency's mandate that national forests serve multiple uses and concluded that some oil and gas development could occur without harming wildlife.

Thursday, July 28, 2005

Court returns energy measure to ballot

Voters will, after all, get a chance to vote on energy regulation...and whether or not it sticks will be decided after the election.

The California Supreme Court restored a consumer-sponsored energy initiative to the Nov. 8 state ballot Wednesday, saying the public should vote on the measure before a legal challenge by the energy industry is considered.

Acting with unusual speed, the court unanimously overturned a ruling issued last Friday by the state Court of Appeal in Sacramento that struck Proposition 80 from the ballot.

The order means the voters will consider, for the second time in seven years, a rollback of the state's 1996 electricity deregulation law. That law, which removed most of the Public Utilities Commission's control of electric supplies and rates, has been attacked by both sides of the energy debate -- for going too far or not far enough -- and is widely blamed for the blackouts and price spikes that Californians endured in 2000-01.

In a suit by energy producers, the appeals court ruled last week that Prop. 80 conflicted with a provision added to the state Constitution in 1911 that gave the Legislature "plenary power'' to increase the PUC's authority over utilities. Plenary power is defined as total and exclusive, leaving no room for lawmaking by initiative, the three-judge panel said.

Some see it as a good sign for the Redistricting Initiative as well.

Comfort at odds with Conservation

It seems we are asked to cut back on our energy use in California just when we need it most--and that has some folks uncomfortable.

During the 2001 energy crisis, Californians stepped up and saved about 3,000 megawatts on hot summer days. That's enough to power nearly 2.3 million homes, according to the California Independent System Operator, or Cal-ISO, which controls 75 percent of the state power grid.

But electricity consumption is ratcheting up again, while conservation efforts appear to be sliding, energy officials say. Last summer, California used so much power during critical afternoon hours that the state surpassed the five-year-old record for peak demand use seven times.

Electricity use per capita jumped nearly 7 percent in 2004 vs. 2001, according to the California Energy Commission. That's about $52 worth of extra power per person last year.

In Orange County, our electric bills are creeping up at roughly the same rate, according to Southern California Edison, the county's primary energy provider.

"The energy crisis has slipped into the past and people aren't as conscious as they were of the benefits of conservation," said Gil Alexander, a spokesman for Edison, which serves 710,303 O.C. residents.

Federal Energy Bill Criticized

If the goal of a Federal Energy Bill was reducing dependence on foreign oil, critics say it fails:

The energy bill nearing passage in Congress, promoted by the Bush administration as an important step toward making the U.S. less reliant on foreign oil, would do little in the short term to boost the nation's energy independence or provide relief for motorists paying record gasoline prices, analysts said Wednesday.

The U.S. petroleum industry, already enjoying record profits from skyrocketing oil and natural gas prices, lobbied aggressively for the legislation and received billions in tax breaks and other incentives partly designed to encourage drilling projects.

But based on those incentives alone, the industry is unlikely to start sinking new wells — projects that require years of development before they add fresh oil and gas to the market, experts said.

"The energy bill is not going to make a meaningful difference in U.S. supplies," said Steve Enger, an analyst at Petrie Parkman & Co., an energy investment bank in Denver.

The bill, the first overhaul of national energy policy in more than a decade, is expected to be approved by the House of Representatives today and the Senate on Friday. President Bush, a former Texas oilman, has pushed for the energy bill since taking office in 2001 and is expected to sign it.

Seems to be the second time we've read the same story in the last few days--which means either it's true, or, more likely, the media is taking its cues from someone's talking points.

Wednesday, July 27, 2005

Energy bill comes together, rankles Californians

It looks like the conference committee has finally come together to approve a federal Energy Bill.

Congressional negotiators clinched an agreement Tuesday on a national energy bill to boost oil and gas production, triggering a debate over whether the massive bill would steer the nation toward energy independence or just pour money into the pockets of producers.

For California, the compromise bill clears the way for the waters off the coast to be mapped for their oil and gas potential. The state also would see its authority over the location of liquefied natural gas facilities weakened and, for the first time in six decades, electric utilities could be sold to corporations with no experience in the business or connection to regional markets.

Although the changes to LNG siting rules would only affect one California project--in Long Beach--opponents of LNG in other parts of the State are nonetheless upset.

Tuesday, July 26, 2005

Governor speaks out for Cabrillo Port

Perhaps as a distraction from the flailing special election efforts, Governor Schwarzenegger turned his sights on the State's energy needs, reiterating his support for the Cabrillo Port LNG terminal.

"I think the key thing is public safety on all of this," Schwarzenegger told reporters during a brief question-and-answer session following his remarks encouraging energy conservation at the California Independent System Operator in Alhambra.

"And I think that we have established - I think that the one, for instance (off) Oxnard, where you build it out approximately 11, 12 miles off the shore, could be probably the most safe one for California."

Schwarzenegger said his support for the site (which is actually 14.4 miles off the coast, according to BHP Billiton, the Australian energy company that is promoting the Oxnard location) does not mean he believes the other locations - particularly the one in Long Beach, which would sit near densely populated neighborhoods - are dangerous.

"It's just my personal preference is Oxnard," Schwarzenegger said. "But ... after we have studied all this and see the pros and cons, I think we will be able to make a better decision on that."

Energy bill does nothing for dependence

Weaning the United States off of foreign oil is harder than previously thought, and despite its best intentions it looks like federal Energy legislation won't go very far to accomplish that goal.

Despite repeated calls by President Bush and members of Congress to decrease U.S. dependence on oil imports, a major energy bill that appears headed for passage this week would not significantly reduce the country's need for foreign oil, according to analysts and interest groups.

The United States imports 58 percent of the oil it consumes. Federal officials project that by 2025, the country will have to import 68 percent of its oil to meet demand. At best, analysts say, the energy legislation would slightly slow that rate of growth of dependence.

"We'll be dependent on the global market for more than half our oil for as long as we're using oil, and the energy bill isn't going to change that," said Ben Lieberman, who follows energy issues for the conservative Heritage Foundation in Washington. "There's a few measures to increase domestic production . . . and that would not do much."

Monday, July 25, 2005

MTBE fix will move Energy Bill

Although the companies that own gas stations were responsible for MTBE leaking into the nation's water supplies, it will be the MTBE manufacturers who pay the price in the deal cut to move the Federal Energy Bill forward.

Congressional negotiators said Sunday they had resolved a dispute over a controversial gasoline additive that had threatened passage of the first overhaul of national energy policy in more than a decade.

They said they did not expect the energy bill to include any legal protection for the manufacturers of methyl tertiary-butyl ether, or MTBE, which helps engines produce less smog but has been blamed for contaminating groundwater supplies across the country.

The decision not to shield MTBE manufacturers from environmental lawsuits should clear the way for negotiators to complete work on a final bill, perhaps as early as today, and send it to the House and the Senate for approval by the end of the week.

Nunez blames Governor for Weather

It's been hot in California the last few days, prompting Californians to use more airconditioning, bringing supply and demand for electricity closer to parity.

If you believe Assembly Speaker Fabian Nunez, it's all BushSchwarzenegger's fault.

It's darn hot in California, Gov. Arnold Schwarzenegger and Assembly Speaker Fabian Núñez agreed yesterday as temperatures climbed to triple digits.

There the Republican governor and Democratic speaker diverged in their weekly radio addresses, as the speaker criticized the governor for not doing enough to boost electricity supplies after two days of power-shortage warnings in Southern California.

Núñez, of Los Angeles, evoked the rolling blackouts that hit the state in 2000 and 2001, and criticized the governor for vetoing his bill last year that would have reregulated the state's electricity market.

Of course, Nunez fails to explain how signing his bill would have made it any cooler in California or built one new power plant. In fact, it may have made things worse with its provisions against distributed generation--making everyone rely on the grid.

Windmill Idling is for the birds

Wintertime, when Californians traditionall use less electricity than normal, is also a convenient time to shut down the State's windmills in order to protect the birds...or so the theory goes.

Windmills in the Altamont Pass near Livermore will be partially shut down this winter to protect birds that have been flying into turbine blades and dying in large numbers.

This is the first time since the wind farm opened 24 years ago that the operation will be curtailed to protect migrating birds and raptors, such as golden eagles, red-tailed hawks and Western burrowing owls.

The Alameda County Board of Supervisors gave preliminary approval to the seasonal shutdown and other measures this month — steps that went beyond what the wind energy industry supported but that didn't completely satisfy environmentalists either.

LADWP available to rescue State in Energy Crunch

As temperatures abate this week in Southern California, those worried about energy shortages have another reason to have a sigh of relief. If all else fails the Los Angeles Department of Water and Power has surplus electricity.

Los Angeles has its own power-generation system and was spared deliberate blackouts this week, but Mayor Antonio Villaraigosa urged residents to conserve as much power as possible so energy could be provided to other areas of the state.

As part of an overall conservation effort in the city, the mayor urged residents to adjust their energy needs during peak hours, turn off lights, adjust thermostats to 78 degrees and open doors and windows to draw in cooler air at night.

"Make no mistake about it, in some cases we are talking about life-and-death situations," Villaraigosa said during a news conference in front of the Department of Water and Power headquarters.

"We are fortunate that Los Angeles has enough energy to take care of our needs. But we need to be a good neighbor and help out where we can."

Friday, July 22, 2005

Prop 80 kicked off ballot

Proposition 80, the energy re-regulation initiative has joined Prop 77 in the dustbins of November's Special Election.

The 3rd District Court of Appeal, in a 3-0 opinion, tossed Prop 80 off of the ballot today. The prop would have made it so individuals and businesses could not purchase energy outside of the PUC. It was backed by the unions (I still don't fully understand why) and opposed by business (who don't like to be told where they have to buy stuff).

The court found that only the legislator has the authority to give the PUC additional powers so they tossed it.

Southland grid can't cope with heatwave

Southern California's electricity supplies were precariously close to triggering rolling blackouts as tempertatures soared.

The West's deadly heat wave brought record temperatures and several power plant failures Thursday, triggering Southern California's first electricity supply emergency in more than two years and hinting at problems the region could face on sweltering days this summer.

Blackouts were threatened for a few hours Thursday afternoon as air conditioners kicked into high gear — setting power use records in the Southland — but utility customers largely escaped disruptions. Although state utilities expect to have enough electricity to meet demand today, the prospect of continued hot and humid weather prompted California power officials to urge energy conservation to avoid shortages.

Perhaps California should look at ways to build more generation to meet the energy demands!

Oil companies reach MTBE deal

The gasoline addative MTBE was supposed to save California from pollution and help gas mileage. Instead, leaking gas station tanks let the chemical into our water supply. Now the oil companies are, rightly, taking responsibility and paying up.

The oil industry has agreed to contribute $2 billion to help clean up spills of a gasoline additive that is fouling groundwater in exchange for immunity protection against dozens of lawsuits, people close to the negotiations said.

But the industry's proposed contribution, which would go into a new fund set up to deal with claims of contamination by the fuel additive, methyl tertiary-butyl ether, or MTBE, falls far short of some estimates of what it would take to pay for the cleanups.

Republican leaders in the House are brokering the deal in an effort to push comprehensive energy legislation through the Senate and avoid a painful repeat of two years ago, when the gasoline additive issue ultimately helped sink the bill.

The issue is also important to oil and chemical companies, which have been pushing to shield themselves from lawsuits claiming that the chemical's manufacturers should be held responsible for cleanup costs. Municipalities have estimated the total cleanup will cost more than $20 billion. The American Petroleum Institute, an oil industry trade group, has estimated the cost at closer to $1.5 billion.

"The industry needs closure on this issue, they need certainty," said Lawrence J. Goldstein, president of the Petroleum Industry Research Foundation, an industry-financed group. "They don't want to leave this open-ended, because they know at the end of the day big pockets could be required to pay for the cleanups."

Congress moves to expand Daylight Savings Time

During the California Energy Crisis, Brad Sherman suggested expanding Daylight Savings time for the State. Now, at least partially, the idea is getting some traction on Capitol Hill. LA Observed likes the Idea: "That first week of October darkness during the evening freeway commute is hellish. Silly quote though from Rep. Edward J. Markey (D-Mass.): "The beauty of daylight savings time is that it just makes everyone feel sunnier."

Voters love message, not messenger

Governor Arnold Schwarzenegger is aggressively pursuing pro-environment policies, from a Hydrogen Highway to a million-home solar initiative. The voters agree with him on the environment, but apparently, do not know it.

Another PPIC poll asks some questions about a specific issue -- in this case, the environment -- and finds that Californians are pretty much in sync with the policies Gov. Arnold Schwarzenegger is advocating. Then the survey asks, what do you think of Schwarzenegger's peformance on environmental policies? And he bombs. This time, 32 percent approval rating, the same as George W. Bush. Overall, Schwarzenegger's rating drops to 34 percent from 40 percent in the last PPIC poll. Bush is at 38 percent.

Thursday, July 21, 2005

One Stage from Rolling Blackouts

Dan Weintraub reports on the current power situation in California:

California's electricity grid operators have issued a Stage 2 elecricity emergency in Southern Calfironia because of high demand and the loss of about 2,000 megawatts of generation due to equipment failures. The state has not yet but is preparing to interrupt electricity to large industrial customers whose rate structure allows their power to be shut down in an emergency. The next level of emergency after that would be Stage 3 and rolling blackouts

Here we go again!

Energy Industry wants to scuttle ballot measure

Generally in California, there is a bias to "let the people decide" but energy industry officials believe the matter is not appropriate to be in the hands of the voters.

Lawyers for an energy-industry trade group argued Wednesday before a state appeals court that Proposition 80 should be taken off the Nov. 8 special election ballot.

The Independent Energy Producers Association opposes the measure because it would limit retail power sales by non-utilities. The group is trying to get it thrown off the ballot on a legal technicality: The group's lawyers told the California 3rd District Court of Appeal that the measure should be written as an amendment to the state constitution rather than as just a change in state law.

Attorneys for The Utility Reform Network, the San Francisco-based consumer group that sponsored the initiative, argued that voters don't have to amend the state constitution to change the rules governing power sales.

It seems with ballot measures, be it on Energy Regulation or Redistricting, it's in many cases the judges, not the people, who decide.

Refineries face new rules in Bay Area

Refineries in the San Francisco Bay area are facing new rules for burn-offs.

In a decision praised by environmentalists and labor unions, Bay Area air quality officials imposed the toughest regulations in the nation Wednesday to reduce flaring at the East Bay's five oil refineries.

The Bay Area Air Quality Management District board of directors overwhelmingly approved a plan that requires refineries to minimize routine flaring, which can release a toxic brew of gases and chemicals that critics say cause health problems and increase air pollution.

"I think it's really noteworthy that we're taking this leadership position on a very complicated issue and are going to provide not only cleaner air but better health protection,'' said district spokeswoman Teresa Lee. "We are going to show in the Bay Area that it can be done efficiently and effectively.''

Other areas in the nation where refineries are located, including Southern California, may follow the groundbreaking plan, Lee said.

Wednesday, July 20, 2005

Powerful Hybrids lose Environmental bennies

Souping up your gas-sipping hybrid makes it a benefit-sipping vehicle, and the NYT is not happy...

When the Honda Accord Hybrid hit the streets, we were elated — finally somebody had come up with a real-world application for hybrids that married performance and economy. Think of the hybrid Accord this way — it has the fuel economy of a large-ish four and makes more grunt than some recent 8s, using the hybrid system as a power-adder. Now the Times, flagship paper of a city of people whose knowledge of cars often doesn’t go beyond the back seat of Crown Victorias or Town Cars, starts hemming and hawing over the fact that some people out there would actually want hybrid performance cars. In essence, they’re comparing kumquats to watermelons. Where they should be comparing the Accord Hybrid to vehicles like the Dodge Charger and Pontiac Grand Prix, they’re instead trying to force it into an Insight metric, which, to quote the mighty Hüsker Dü, makes no sense at all.

Chevron favored in Unocal bid

ChevronTexaco has emerged as the favorite in the international tug-of-war over California energy giant Unocal.

Oil giant Chevron Corp., facing a strong challenge from a Chinese rival, increased its bid to buy Unocal Corp. on Tuesday night and quickly won the approval of Unocal's board, a decision that brings the two American companies closer to a merger.

San Ramon's Chevron, which had been vying with China National Offshore Oil Corp. to buy Unocal, increased its bid to $17 billion, up from roughly $16. 5 billion. Unocal's board accepted the deal Tuesday night and recommended that the company's shareholders approve it at a special meeting on Aug. 10.

Chevron's increased bid still doesn't match China National's $18.5 billion offer. But the foreign firm, which is 70 percent owned by the Chinese government, has encountered fierce opposition in Washington, with politicians calling its bid a threat to national security.

Chevron, in contrast, already had the approval of federal regulators for its earlier bid. The offer of more cash by Chevron appears to have won over Unocal's board, which agreed to Chevron's original offer this spring but had been considering switching to CNOOC.

Tuesday, July 19, 2005

Elias: Energy Bill screws California

On one point, commentator Tom Elias correctly notes how the Federal Energy bill will hurt California.

One is a mandate that Americans use 8 billion gallons of ethanol in their gasoline within five years -- twice as much as today. For California, this one has three major flaws:

-- California oil refiners do not need ethanol to make gasoline that meets federal clean air standards. But they will have to blend it in anyway, driving up the cost of fuel by about 8-12 cents per gallon.

-- Ethanol, made mostly from corn husks and cobs -- corn squeezin's, one writer called it -- may reduce automotive emissions of carbon monoxide, but it increases other pollutants such as oxides of nitrogen. If refiners cannot meet clear air standards with ethanol, why use it?

-- According to a new study published by University of California-Berkeley Professor Tad Patzek in the journal "Critical Reviews in Plant Sciences," making ethanol may use up to six times as much energy as the resulting fluid contains. Some federal scientists dispute this finding, but no one claims more than a 3-to-2 margin of new energy over what's used to make ethanol.

In short, the new ethanol mandate is a slap at California and welfare for big farmers and companies (read: Archer Daniels Midland Corp., for one) in Corn Belt states that voted solidly for President Bush in the last two elections.

But as he has done so often, Elias incorrectly interprets how the Federal energy bill will impact liquefied natural gas terminals in the State. Unless it is onshore, it won' his attacks on the Cabrillo Port are unwarranted (as always!).

Protests spark reprieve for electric pickups

Leaseholders for Ford's electric Rangers will get to keep on trucking.

Six months after public protests prompted Ford Motor Co. to stop demolishing the last of its electric vehicles, the auto giant announced a plan Monday to return the surviving electric Ranger pickups to erstwhile owners.

Ford officials said about 200 of the last electric pickups would be sold to former leaseholders selected in a lottery.

Of course, with the dwindling number of electric vehicles on the road, I have to wonder what will happen to their dedicated parking spaces!

Crisis! or maybe not! Newspapers confound

Once again, two newspapers reporting the same story can come to totally different conclusions. According to the Sacramento Bee, we should be considering a possible power crisis.

With all generation and transmission systems operating normally, with a number of transmission line improvements, and with 1,700 new megawatts of generation since last summer, "we look to be in good shape," ISO spokeswoman Stephanie McCorkle said.

The ISO could count on nearly 50,000 megawatts of peak power available, but, as with all such supply-demand equations, it assumed that there would be no unexpected generation outages.

So, one might ask, what's the problem? The problem is that California is continuing to add population on a massive scale, thanks to continued high levels of immigration and births, and most of the growth is occurring in inland areas where summer temperatures are high. We've added about 2 million heat-sensitive humans to our population just since the 2001 energy crisis, and those Californians not only want to remain cool in their homes, but also need more air-conditioned schools, shopping centers and workplaces.

Power conservation programs help, of course, but power demand will continue to rise as we continue to add 5 million to 6 million to our population every decade - just as demands for water, housing, highway space and other growth-related services and facilities will continue to increase.

But the San Bernandino Sun, where the blazing sun makes it hot, hot, hot, says we have no worries.

During California's infamous power crisis of 2000-01, phrases such as "rolling blackouts' and "stage-one emergencies' became part of the lexicon in evening newscasts and frustrated discussions in break rooms.

As the state flirts with record power demand and a few spots set records for high temperatures, energy providers are confident the lights will stay on, barring some unforeseen glitch in the system.

"We do seem to have enough megawatts to meet the demand," said Stephanie McCorkle, spokeswoman for the California Independent System Operator, which runs much of the state's power grid.

Monday's prediction for a possible record level of demand fell short, thanks to temperatures in other areas that were much lower than expected, the Independent System Operator announced late in the day.

The common thread is how the papers interpret the possibility of an unforseen glitch in the system. Wasn't after all, the market manipulation of Enron et al, and unforseen glitch in the system? Shouldn't we expect the unforseen glitches if the system is to be, indeed, reliable?

Monday, July 18, 2005

Monday declared "Flex your Power" day

With a string of record-high demand for electricity in California, the Independent System Operator is encouraging Californians to conserve today.

The Conserve-o-meter has switched to "needed" and the Cal ISO is announcing "Restricted Maintenance Operations" in both Northern and Southern California.

Today's Outlook [CA ISO]

Prop 80 revives energy regulation debate

The next time voters go to the ballot box in California, they will be asked to decide an ongoing debate over energy regulation.

Proposition 80, an initiative on the Nov. 8 special election ballot, would ban consumers who aren't already doing so from buying their electricity from independent power providers.

By limiting the state's retail market for electricity, which gives users such as homeowners, hospitals, factories and farms an alternative to buying power from regulated utilities, Proposition 80 would roll back an important feature of the state's 1996 electricity deregulation law.

It also would provide at least a partial answer to the question of "whether we're going to have a market-based system or a regulated system" of power production and consumption in California, said Peter Navarro, a business professor and energy expert at UC Irvine.

It's a question of great import in a state that's preparing for electricity shortages this summer. The officials who oversee the state's power grid are bracing this week for record electricity usage and the possibility of issuing the first Stage 1 power alert of the year.

Proposition 80 would do little to quickly solve the problem at the core of California's energy woes — getting enough power where it's needed, when it's needed. But backers, led by the Utility Reform Network, a San Francisco ratepayers' advocacy group known as TURN, say the initiative would bring stability to the state's power grid and encourage investors to provide the financing for new power plants, helping the state meet its future energy needs.

Market effects not kicking in on Energy Prices

Apparently, demand for gasoline is not as elastic as many suppose...

Crude oil prices rose Sunday as Mexico shut down offshore oil fields in fear of Hurricane Emily. Anxiety about more severe storms could drive crude prices beyond the $60-a-barrel mark.

That's $10 higher than last month, which translates into a 25-cent jump at the pump. Yet, if drivers shop around, they could purchase gas for as low as $2.41 a gallon in San Jose.

There are several reasons drivers fail to get the lowest price: convenience, location, brand loyalty -- and it has been just too darn hot to be messing around in search of cheaper gas.

Enron settles with State of California

Five years after the energy crisis began in California, the State is finally getting closure in its dispute with Enron.

Enron Corp., whose energy traders bragged about stealing money from "Grandma Millie" in California, has agreed to pay $1.52 billion to California and other Western states to settle claims of price gouging during the 2000-01 energy crisis.

"Grandma Millie can feel vindication. We've been fighting for her rights, " said California Attorney General Bill Lockyer, who filed a lawsuit against the energy trader after audiotapes emerged of its traders chortling over schemes called "Death Star," "Fat Boy'" and "Get Shorty" that drastically drove up energy prices during the crisis.

But Grandma Millie will see precious little relief from the settlement of the suit charging that Enron illegally rigged the market by withholding power to make prices soar. The actual payout is likely to be more in the neighborhood of $260 million because the energy trader is bankrupt and has limited assets.

Friday, July 15, 2005

Natural Gas cleaner than Nuclear?!?

Advocates of Nuclear ower have long claimed that it is zero-emissions and if you could just figure out what to do with the nasty residual waste, nuclear power would solve all of our problems. But not so fast...

The Australian reports that according to an Australian scientist atomic power generates more damaging greenhouse gas emissions than gas-fired power.

As federal and state politicians debate the merits of starting down the atomic power path to help reduce Australia's contribution to global warming, scientists say it may not be so clean after all.

University of NSW Institute of Environmental Studies senior lecturer Dr Mark Diesendorf says atomic power stations do not emit carbon dioxide (CO2) themselves, but the processes involved in creating atomic energy do.

Mining, milling, uranium enrichment, atomic fuel production, power station construction and operation, storage and reprocessing of spent fuel, long-term management of radioactive waste and closing down old power stations all require the burning of fossil fuels, he says.

"Most of the energy inputs to the full life cycle of atomic fuel come from fossil fuels and are therefore responsible for CO2 emissions," Dr Diesendorf writes in this month's edition of the Australasian Science magazine.

Atomic power stations using high-grade uranium ores would have to run for seven to 10 years before they created enough power to cancel out the energy required to establish them.

Wind power takes just three to six months to do the same.

For lower grade uranium ores, greenhouse gas emissions outweighed those produced by an equivalent gas-fired power station, Dr Diesendorf said.

Chinese Demand for oil slips, but not for oil companies!

In a good sign for the U.S. economy, China's demand for oil is decreading:

Chinese oil demand has slowed a bit recently, declining one percent from the same quarter last year.

However, their demand for Oil companies remains as hearty as ever!

Thursday, July 14, 2005

LADWP considers bonds for Natural Gas, capital improvements

The Los Angeles Department of Water and Power is seeking to shore up its natural gas reserves by buying now rather than paying later.

A separate $250 million bond would be used to replenish the department's cash after the recent purchase of a natural gas field reserve.

The department joined with a number of other local government agencies to buy the southwest Wyoming site to bolster long-term natural gas supplies, said Randy Howard, project manager for the gas project.

Since July 1, the Department of Water and Power has been receiving almost 13 percent of its natural gas requirements from the field, Howard said.

While the department spent $223 million on the field, the extra money from the bond would pay for the drilling of additional wells on the property, Howard said.

Lawmakers oppose Chinese bid for Unocal

Capitol Hill was abuzz yesterday with opposition to a proposed Chinese takeover of California oil giant Unocal:

In unusually harsh terms, lawmakers and former government officials lashed out at China National Offshore Oil Corp., which has launched an unsolicited $18.5 billion takeover bid for California's Unocal. The offer is higher than Chevron Corp.'s proposal to buy Unocal for about $16.5 billion, a bid federal regulators have already blessed.

Speakers at the House Armed Services Committee hearing called the move an effort by Beijing to lock up oil supplies at the expense of the United States, since the Chinese government owns 70 percent of CNOOC. Some see it as proof that China means to replace the United States as the world's most powerful nation.

"I believe the (People's Republic of China's) aim is inexorably to supplant the United States as the world's premier economic power and, if necessary, to defeat us militarily," said Frank Gaffney, an assistant secretary of defense in the Reagan administration.

Transmission fees fall, so do reserves

It's hot, hot, hot in Southern California and the heat wave could test the reliability of California's grid--at the same time as the ISO is dropping transmission prices.

The California Independent System Operator, which manages most of the state's power grid, on Wednesday said it would reduce its transmission charges by about 15% next year after cost-cutting measures that would shrink its workforce by almost 16%.

Separately, Cal-ISO warned that a heat wave in much of the state could cause electricity reserves to fall below 7%, triggering a so-called Stage One alert. Cal-ISO urged conservation but said that it expected to have enough power to meet demand.

As it faces a summer of potential electricity problems, particularly in Southern California, Cal-ISO is working to lower operating costs so that it can reduce its grid management charge on electricity moving over its wires.

"The California ISO must mature from a start-up organization … into a world-class organization that is well-positioned to tackle transmission infrastructure challenges in a more timely and effective manner," Chief Executive Yakout Mansour said.

Cal-ISO said it would lower its grid management charge to 73 cents a megawatt-hour in 2006, down from the current 85 cents. The not-for-profit agency said the charge should fall to about 60 cents by 2010.

Layoffs at ISO

The California Independent System Operator is scaling back its operations.

California's electric grid operator on Wednesday laid off 37 more employees, and soon will complete a round of about 50 job cuts aimed at reducing costs, said officials for the state Independent System Operator.

The not-for-profit agency, based in Folsom, is also eliminating several dozen vacant positions, decreasing its total work force from 612 to 517, said ISO spokeswoman Stephanie McCorkle.

The job cuts, steep reductions in spending on contractors and other staff changes should help the grid operator lower the fees it charges wholesale electricity buyers, she said. Those buyers, including utilities, ultimately pass the costs along to their own customers.

Let's hope that does not mean the system's reliability will be scaled back as well.

Wednesday, July 13, 2005

Oil Platform Peril drives up oil prices

Hurricane Deniis may have a broader impact on the U.S. economy than previous hurricanes:

B-P is working to save a (B) billion-dollar petroleum platform found listing in the deepwater Gulf of Mexico after Hurricane Dennis.

B-P says it still doesn't know what caused the list. Yesterday, information from data records on the Thunder Horse platform was sent to shore for analysis after power was restored and crews were able to go aboard.

Thunder Horse was evacuated Friday in anticipation of the hurricane. The listing platform was first noticed Monday by a passing ship.

It's the largest platform in the Gulf of Mexico and the center of the Thunder Horse field -- about 150 miles southeast of New Orleans in about six-thousand feet of water.

B-P had expected as much as 240-thousand barrels of oil per day to be produced from the platform later this year.

Unocal bid raises security concerns?

For the Department of Defense, there are limits on foreign ownership of suppliers. But for equally important matters--like oil--could foreign ownership also harm national security?

The fate of the China National Offshore Oil Corporation's bid for Unocal remains uncertain, but one thing is clear. The takeover offer has prompted a gathering groundswell in Congress to make sure oil is defined as a product vital to America's national security.

If the political push gains momentum, it will change the mandate and reach of a little-known, secretive body with representatives from 12 government agencies, the Committee on Foreign Investment in the United States. The outcome of Cnooc's bid for Unocal may rest in the hands of that committee.

One salvo came at the end of last month with a House resolution that declared that permitting the Chinese company to buy Unocal would "threaten to impair the national security of the United States." It passed 398 to 15.

Now the members of a bipartisan advisory group to Congress are urging representatives and senators to amend the law that controls the work of the foreign investment committee. The Congressional advisory group wants the law to specifically expand the definition of America's national security to include matters of economic security, like energy and oil supplies.

"Is energy security national security? We certainly think it is," said C. Richard D'Amato, chairman of the United States-China Economic and Security Review Commission, which advises Congress.

Drivers rush to replace SUVs?

Could soaring gas prices, not employee pricing incentives, be the cause of Detroit's recent revival? Anecdotal evidence says yes!

The national average for regular unleaded gas is $2.33 per gallon, while the state average is $2.56, according to the Automobile Club of Southern California. In the San Bernardino area, the highest recorded price was $2.64 in April, and analysts expect prices to surpass that within the next week.

The high prices have left many searching for ways to pinch pennies at the pump.

"I had to downsize my vehicle. I had an Expedition,' said Cindy Lankey of Fontana, who dumped her large sport utility vehicle in favor of the smaller Mitsubishi Outlander. "It's small and my kids are squished, and they complain a lot, but they'll get over it.'

Lankey spent $29.31 to fill her car at a Fontana gas station. If she still had her Ford Expedition, the cost would have been twice as much

Tuesday, July 12, 2005

Prevailing Wage Could Kill Solar Initiative

If the Governor is going to get his Million Solar Homes initiative passed, it will be without the help of the GOP caucus. Knowing that, Democrats are extracting concessions from Schwarzenegger, but they could go a bridge too far.

Solar's future is bright, but in the bowels of the Legislature, business remains murky. There, labor unions are demanding that private contractors pay "prevailing wages" to workers who install solar panels as part of SB 1, the governor's legislation to help provide solar energy to 1 million homes.

Industry unions have won important victories for their members in recent years, but in this case, they are going too far.

The prevailing wage demand could kill SB 1. All state construction projects must now pay prevailing wages. Now the unions want those wages -- effectively union wages -- to apply to any large-scale development that receives a state subsidy. It's a costly precedent, one that would destroy the basic economics of the governor's plan.

If they were forced to pay prevailing wages, solar industry leaders say it would drive up the total cost of a photovoltaic system by 15% to 40%. Homeowners would be less likely to opt for solar panels. California citizens, including union households, would be deprived of a technology that could create 3,000 megawatts of clean power by 2018.

Natural Gas Lowers truck pollution

Well it's not groundbreaking news, but switching from diesel to natural gas lowers pollution.

The Ventura County Air Pollution Control District recently used grant money to reduce by tons the amount of smog-forming pollutants emitted from the expanded Toland Landfill in Santa Paula.

The Ventura Regional Sanitation District gave the district a $534,820 grant to reduce nitrogen oxides and reactive organic gases emitted by trucks and heavy equipment at the landfill. The money was used to convert diesel engines to run on liquefied natural gas and also to start a lawnmower buy-back program

Déja Vu at Long Beach LNG hearing

The local papers in Long Beach should just start practicing "cut and paste" when it comes to stories about liequefied natural gas:

A U.S. Coast Guard meeting Monday to hear concerns from the public on maritime safety and security of a proposed liquefied natural gas terminal in the Port of Long Beach followed a pretty familiar pattern.

A group of residents opposed to the terminals denounced it as unsafe and a terrorist target while proponents touted the terminal's potential economic benefits and the good safety record of LNG terminals worldwide.

The meeting at the Long Beach Marriott was held for Coast Guard officials to gather testimony before giving recommendations to federal energy regulators on the suitability of the port for an LNG terminal.

Monday, July 11, 2005

Disaster scenarios considered to nukes in California

California's two nuclear power plants have more than terrorist attacks to workk about. Since they lie on the coastline, natural disasters must be considered.

Six months after the mega-tsunami in the Indian Ocean, fears of a major tsunami on the California coast are spurring scientists to reassess the possible impact on nuclear power plants.

PG&E is planning to spend $500,000 in a new effort to assess how two worst-case scenarios for tsunamis -- the "apocalyptic model" and the "decades-of-terror model," as the utility's top geoscientist, Lloyd Cluff, calls them -- would affect the Diablo Canyon nuclear plant near San Luis Obispo and the decommissioned Humboldt Bay nuclear plant near Eureka.

The 2,300-megawatt Diablo Canyon plant supplies 10 percent of California's electricity. The small Humboldt Bay plant closed for refueling in 1976 and was never restarted. However, like Diablo Canyon, the Humboldt Bay plant still has large amounts of highly radioactive, used nuclear fuel in a storage pool.

"We will model this with the best tsunami models that exist to decide whether we need to do any more (upgrading) with these two facilities" to guard them against tsunamis, Cluff told the state Seismic Safety Commission at its June 23 meeting in San Francisco.

A third nuclear plant, San Onofre, is north of San Diego and is operated by Southern California Edison. Officials there said they are confident the plant is safe from tsunamis. Unlike PG&E, they plan no reassessment of their tsunami risks.

Smaller Solar means more electricity

Nonotechnology uis driving a revolution in solar generation:

Investors along Sand Hill Road in Menlo Park are pouring money into solar nanotech startups, hoping that thinking small will translate into big profits.

Both inventors and investors are betting that flexible sheets of tiny solar cells used to harness the sun's strength will ultimately provide a cheaper, more efficient source of energy than the current smorgasbord of alternative and fossil fuels.

Nanosys and Nanosolar in Palo Alto -- along with Konarka in Lowell, Mass. -- say their research will result in thin rolls of highly efficient light-collecting plastics spread across rooftops or built into building materials.

These rolls, the companies say, will be able to provide energy for prices as low as the electricity currently provided by utilities, which averages $1 per watt.

Now, if only the Legislature doesn't get in the way of making the Governor's solar plan, SB 1, truly work for California, this might work.

San Francisco seeks transmission link

You can generate all the power you want, but if you can't get it to the users, it is worthless. San Francisco is seeking a way to get power to the Bay Area.

Electric power is San Francisco's Achilles' heel.

The city's aging power plants don't generate the amount of electricity its people need. High-voltage lines tied to the state's power grid take up the slack, but they all come from just one direction -- the Peninsula. An earthquake there could shut down several lines at once, plunging parts of San Francisco into darkness.

Now, the city of Pittsburg and Babcock & Brown, a finance company specializing in power projects, want to bring energy to San Francisco through a new route -- a cable under the bay.

They plan a $300 million electrical line running beneath the bay floor from Pittsburg to San Francisco. Buried 3 to 6 feet deep for most of its 55 miles, the transbay cable would give the city an extra path for power.

Friday, July 08, 2005

Are LNG opponents handing victory to terrorists?

Reflecting on the aftermath of the London attacks, I got to thinking about a common theme in local debates over building critical energy infrastructure in California.

In Ventura County, attorney Tim Riley goes into hysterics over the dangers of liquefied natural gas. His website shows pictures with practically the entire coast of Ventura County and Malibu covered in a ball of flames resulting from terrorists' plot to attack on offshore LNG terminal. Some residents, who shouldn't be expected to understand the science behind it, buy into his fearmongering and have called for the Coast Guard and State Lands Commission to deny permits to build any LNG terminals in the State.

California needs natural gas to fuel our power plants, and LNG is just about the last solution we have. The terrorists want us to live in fear--and by trying to deny the State the infrastructure it needs to keep our economy growing--opponents of LNG are handing them a victory.

Schwarzenegger dedicates transmission line

Because electricity cannot be stored, one of the greatest obstacles to maximizing its use is having transmission lines to get it from generation plant to users. In San Diego, transmission is now less of a worry.

The governor joined San Diego Gas & Electric to celebrate a new transmission line that the utility said would save ratepayers $50 million over the course of the first year and help ward off summer brownouts.

The $45 million line, which runs from a substation south of the Sweetwater Reservoir near Chula Vista into Mission Valley, has been in operation for a month, already saving the utility $7 million.

"That's what I call a great investment," Schwarzenegger said.

SDG&E has grappled with congestion on the Southwest Power Link, a major power transmission line from Arizona into San Diego. That link ends at the substation near the reservoir.

But because the line narrowed at that point, San Diegans often could not take advantage of lower-cost imported power, said Ed Guiles, SDG&E's chairman and chief executive.

Legislature a speedbump on Hydrogen Highway

Even when Republican Governor Arnold Schwarzenegger tries to support ideas traditionally considered to be in the Democrats' domains, the Legislature tries to get in his way. The latest example comes in his efforts to build a Hydrogen Highway in California.

Lawmakers raised questions about one spending item– $6.5 million for leasing 12 hydrogen-powered vehicles for the state fleet, three hydrogen fueling stations and hydrogen technology research – at a time when other programs are being cut.

"Even as an environmentalist, it's really hard to put $6.5 million into anything when you haven't got any money," said Assemblywoman Jackie Goldberg, D-Los Angeles, who ultimately voted for the legislation.

The measure, which was part of a supplemental budget bill, couldn't get the required two-thirds vote, but it passed after lawmakers downgraded it to a majority-vote bill. The change means only that it will take effect Jan. 1 instead of immediately after being signed.

Could you imagine if Assemblymember Goldberg made those remarks about, say, Education or another lobby with a strong union?!? It's a sad day for the environment when Arnold Schwarzenegger is it's only friend.

Thursday, July 07, 2005

Green Energy Revolution in California

If it were to happen anywhere in the USA, it would make sense that California would spark a Green Energy revolution:

The state is encouraging energy development, including production from out-of-state and a 1,300-mile transmission line to deliver the power that Californians will need to avoid the rolling blackouts that they experienced in 2000 and 2001. However, it is demanding that the power be produced in a way that doesn't further harm the environment.

Because of its size, market muscle and emerging crackdown on greenhouse gases, the most populous state and world's fifth-biggest economy could trigger sweeping changes in electricity production and transmission across the fast-growing West.

California led the nation during the 1960s and 1970s in forcing automakers to cut tailpipe pollution, and the state once more has forged ahead of the federal government with aggressive goals to help staunch global warming.

The consequences could hasten the USA's shift to cleaner energy, including renewable sources such as solar and wind, and encourage other states to regulate greenhouse gases, the chief cause of global warming, energy experts say.

The catalyst, in Government at least, seems to be Arnold himself.

Assembly OKs bill to give up control of LNG

The State Assembly looks like it is ignoring the laws of unintended consequences, approving a measure trying to assert State control over liquefied natural gas terminal site selection which will really shift power to the Federal Energy Regulatory Commission.

A bill slowing the race to build natural gas terminals on the California coast passed out of a key legislative committee Wednesday, after the Assembly speaker removed a member who previously did not vote for it and appointed a new one who did.

The move breathed new life into a measure that the oil and natural gas industries thought they had buried a week ago. Its revival highlights the high- stakes expansion effort by natural gas producers, who have four proposals to build tank farms that would receive shipments of liquefied natural gas and convert it back to gas for use in the state.

Energy companies backing the projects already have invested tens of millions of dollars in a labyrinthine regulatory and permit approval process involving dozens of local, state and federal agencies.

Of course, once the Federal Energy Bill becomes law, the State's arm could only reach to projects offshore--projects on which it already has jurisdiction--thereby giving a tactical advantage to onshore projects for which only FERC has authority.

State wants Unocal cleanup before sale

Uneasy over the possibility that a government-owned, Chinese firm may be buying California oil company Unocal, the State of California is seeking cleanup before any deal goes through:

California Atty. Gen. Bill Lockyer, along with the top law enforcement officers of Montana, New Mexico and Texas, sent a letter to Unocal President Joseph H. Bryant seeking assurances that Unocal would continue to pay for cleanup at Unocal waste sites in their states. Tom Dresslar, Lockyer's spokesman said the letter was sent by fax late Wednesday to Bryant's office in Sugarland, Texas.

CNOOC, which is 71% owned by the Chinese government, has offered to buy El Segundo-based Unocal for $18.5 billion in cash. Unocal officials are weighing the bid against an acquisition proposal from San Ramon, Calif.-based Chevron Corp., which in early April offered to buy the company in a stock and cash deal that was worth $16.5 billion as of Wednesday.

"Should CNOOC's offer be accepted, we are deeply concerned that the funding for cleanup of the sites in our respective states may be jeopardized," the officials said in the Unocal letter. "We urgently need assurances that a CNOOC-owned Unocal could and would honor all of Unocal's current and future environmental obligations."

Wednesday, July 06, 2005

Cal and Cornell: Biofuels are Bunk

Two recent University studies you may never hear of find that biofuels aren't all their cracked up to be:

For ethanol production, the study found that:

* Corn requires 29 percent more fossil energy than the fuel produced.
* Switch grass requires 45 percent more fossil energy than the fuel produced.
* Wood biomass requires 57 percent more fossil energy than the fuel produced.

For biodiesel production, the study found that:

* Soybean plants requires 27 percent more fossil energy than the fuel produced.
* Sunflower plants requires 118 percent more fossil energy than the fuel produced.

A State role in LNG Siting

Garbage in, garbage out is the bottom lesson from yesterday's San Francisco Chronicle editorial on LNG:

There are no LNG facilities in California today, but four offshore projects are proposed and of those, two -- one near Long Beach, the other near Oxnard -- are getting serious scrutiny. Yet there is no real way to compare these four wildly differing proposals. One converts an oil-drilling platform to this new use. Another facility floats. Under some proposals, the terminal owner would buy the gas on the open market. Under another, the owner would buy exclusively from an energy partner.

...State Sen. Joe Simitian, D-Palo Alto, has introduced legislation to have the state Energy Commission determine need and then rank proposals. The bill (SB426) has passed in the Senate and is now in the Assembly.

Bill opponents, among them the California Chamber of Commerce, argue that calculating need is better left to the marketplace. Existing federal and state requirements are adequate and a new layer will only delay bringing facilities online, they maintain.

...Competitively priced energy is crucial to the state's economy. So are public safety, security and the environmental health of California.

If an LNG terminal is in the state's future, then there should be a regional plan to address its siting and operation, not a marketplace scramble. SB426 offers a way to put one in place.

First of all, the Chronicle begins with the false assumption that both the Oxnard and Long Beach proposals are offshore, when, in fact, the Mitsubishi project in Long Beach is onshore and will fall under FERC authority once the federal Energy Bill becomes law.

While it makes sense to have state input over LNG, nothing can be done at the State level to assert authority over the federal government. SB 426 will, in fact, create extra bureaucracy and delays for projects which already have sufficient State inputs and give projects without any State scrutiny an advantage to get online first.

Lockyer, others weigh in on Unocal bid

Facing the prospect of a Chinese buyout of California energy giant Unocal, California Attorney General Bill Lockyer is stepping in to the fray:

California Atty. Gen. Bill Lockyer and other state attorneys general plan to press for assurances that a proposed purchase by Chinese oil firm CNOOC Ltd. wouldn't undermine Unocal Corp.'s obligations to U.S. environmental cleanup projects and to provide employee pension and healthcare benefits, a Lockyer spokesman said Tuesday.

The development comes amid strained relations between the United States and China over trade and other matters, and as congressional legislators continue to fret that the $18.5-billion offer from CNOOC would threaten national and economic security. Unocal's board is weighing the bid against a $16.8-billion offer from Chevron Corp.

Lockyer, echoing worries of officials in New Mexico, Pennsylvania, Montana and Texas, will send a letter to Unocal executives as early as today expressing concerns about the enforceability of various cleanup pacts and other agreements if the El Segundo oil company is bought by CNOOC, said Tom Dresslar, Lockyer's spokesman

GAO scrutinizes costs of gas blends

While Federal regulations require that gasoline be blended in order to reduce air pollution, a new report by the Government Accounting Office asks, "at what cost?"

The Government Accountability Office said the sheer number of gasoline recipes around the country -- the report said there are at least a dozen -- has had a sweeping effect throughout the gasoline production process.

"The proliferation of special gasoline blends has made it more complicated to supply gasoline and has raised costs, significantly affecting operations at refineries, pipelines and storage terminals," the GAO reported.

The problem is likely to worsen in coming years as stricter smog standards go into effect and states begin looking to new gasoline blends to help meet those standards, the report said.

In California, which has the strictest gasoline formulation requirements, the fuel specifications add 5 cents to 8 cents to the price of a gallon of gasoline, according to state officials.

Offshore drilling ban considered for NorCal Coast

Despite surging oil prices and efforts to reduce reliance on feoreign oil, two Democrats from California want to limit the United States' ability to draw upon its own resources:

Fearing the prospect of oil and gas drilling off the Northern California coast, U.S. Sen. Barbara Boxer and Rep. Lynn Woolsey appeared Tuesday in San Francisco with marine scientists and conservationists to promote legislation that would expand the boundaries of two national marine sanctuaries.

The legislation -- authored by Woolsey, with a parallel measure that Boxer introduced in the Senate -- would increase the jurisdiction of the Gulf of the Farallones and Cordell Bank national marine sanctuaries to include all of the Sonoma Coast, thus extending the sanctuaries' permanent ban on oil and gas drilling to those areas.

"Our state is very clear: We don't want any more drilling," Boxer, a Greenbrae Democrat, said at a news conference at Crissy Field. "The Sonoma Coast is one of the world's most biologically diverse marine environments."

Tuesday, July 05, 2005

Schwarzenegger contradicts Bush on Energy, Environment

When he ran for office, Governor Arnold Schwarzenegger promised to be a different kind of Republican--breking away from traditional views of the party on energy and environment--and his message rings true.

On the eve of the Group of 8 summit in Scotland, Gov. Arnold Schwarzenegger urged the United States and other nations to combat global warming and vowed in an opinion piece in London's Independent newspaper to make California a leader in the effort.

Schwarzenegger never mentioned President Bush in the article, but his call for immediate action contrasts sharply with the administration's recommendation of only voluntary steps to limit greenhouse gas emissions on grounds that more aggressive efforts would hurt the American economy.

"The debate is over. We know the science. We see the threat posed by changes in our climate," Schwarzenegger wrote. "And we know the time for action is now.

"I ask citizens and governments everywhere to do their part by conserving energy, reducing the use of fossil fuels, reducing waste and taking every opportunity to work together for a cleaner, healthier tomorrow."

Consumers willing to pay more for clean energy

It did not require a milti-million dollar advertizing campaign to convince consumers in Palo Alto to adopt clean energy, even at a higher cost:

Residents and businesses pay more for electricity, just under $10 a month for a typical home, and the city government-operated Palo Alto Utilities uses the money to buy wind and solar power that is used citywide.

Program Manager Brian Ward said the city's Future Green program had fewer than 200 participants, so it was renamed and revamped in June 2003. Now, about 3,400 residents and businesses participate.

That's 12.7 percent of the city's overall electrical customers, a participation rate that's the second highest in the country, according to the U.S. Department of Energy.

Will China drive conservation in the States?

Los Angeles Times columnist Ron Brownstein argues that the emergence of China as a global economic power will fuel conservation efforts in the United States:

But the energy and environmental ramifications may justify far more concern. The acquisition attempt, which the Unocal board is studying, suggests that China is anticipating enormous increases in its consumption of fossil fuels. The direct result for the United States and other nations could be a threatening rise in the carbon dioxide emissions associated with global warming, as well as higher gas prices at the pump.

"The more their demand, the higher oil and gas prices are going to go here," says Michael R. Wessel, a member of the congressionally chartered U.S.-China Economic and Security Review Commission. "All people have to do is look at the $2.50 a gallon for gas they spend on their summer vacation to realize that the China problem is here to stay."

Chinese demand isn't the only cause of rising gas prices, of course. China uses far less energy per person than the United States or other Western nations. But it is much less efficient in its energy use than major industrialized nations, partly because it relies so heavily on coal to generate electric power.

China requires about three times as much energy as the United States to produce $1 in economic output. It emits nearly four times as much carbon dioxide per dollar of economic activity as the United States. That means that as China's rapid economic growth continues, its demand for energy and its contribution to global warming will skyrocket.

Of course, there is an alternative scenario that isn't considered. Since the energy costs of economic growth are higher for the Chinese, doesn't it make more sense that the Chinese--not more developed nations--will make the jump to alternatives first? In doing so, could they make those alternative-energy technologies more cost-effective and drive a global revolution through market forces, not government regulation?

Friday, July 01, 2005

Diesel Rules lead to upgrade in generation

Businesses in the Silicon Valley are upgrading their generation in order to comply with new Diesel regulations:

New federal and state rules took effect Thursday that aim to reduce the huge machines' sooty black pollution and other emissions that have been linked to asthma and a host of other lung problems.

Already the rules have companies across Silicon Valley and other urban regions of California scrambling to modernize, retrofit or replace thousands of the huge generators, which can be as big as a house and cost hundreds of thousands of dollars each.

``These rules are good for air quality. They are good for public health,'' said Teresa Lee, spokeswoman for the Bay Area Air Quality Management District in San Francisco.

The rules do not apply to portable generators that are commonly used in homes.

On Thursday, the Bush administration announced federal rules for large stationary generators and engines. New models will have to be built cleaner starting in 2007, with emission reductions of up to 90 percent by 2011 when combined with new, low-sulfur blends of diesel fuel that also are being phased in.

California already had state rules in place as strict as the new federal standards. Those took effect Jan. 1.

The state's rules go further, however, and affect old machines, too. They require owners of existing generators to retrofit them with filters by Jan. 1, 2006.

Today is the deadline for the owners of all 26,000 large stationary generators in California -- including roughly 6,000 at Bay Area companies -- to submit plans to local air districts outlining how many generators they have, how much smog they emit and how they plan to retrofit them to run much more cleanly.

House chides China Oil Deal

In response by the Chinese Government-owned oil company's efforts to buy California oil gian Unocal, the U.S. House of Representatives is voicing its objection:

In a strong bipartisan vote of 333 to 92, the House approved an amendment to a Treasury Department spending bill forbidding the administration from using federal funds to approve the bid by CNOOC Ltd., an arm of government-owned China National Offshore Oil Corp., to buy Unocal for $18.5 billion.

The Treasury Department reviews proposals for significant foreign investment in U.S. companies to ensure that national security isn't damaged, a process that would involve use of federal funds. The review is conducted through the multi-agency Committee on Foreign Investment in the United States, which has seldom blocked foreign investments or mergers.

But more important than its specific terms, the amendment, sponsored by Rep. Carolyn C. Kilpatrick (D-Mich.), was a vehicle for expressing congressional displeasure at the proposal.

"Why do we want to sell our oil to a global economic competitor?" Kilpatrick said. "Americans deserve a thorough government evaluation of the implications of Unocal's takeover by one of our chief economic competitors."

Although the amendment was passed, it could be changed or removed when members of the House and the Senate meet to reconcile their versions of the legislation.

In a separate action, the House approved a resolution, in a late-night 398-15 vote, expressing the chamber's concern that the proposed buyout "could threaten to impair the national security of the United States" and asking the president to initiate a review if the companies proceed.