California Energy Blog

A Second Front in the Climate Change War

2009-12-01T09:46:00.000-08:00

Some sobering global warming commentary from UC San Diego scientists puts Cap & Trade in perspective.

According to the scientists, the preoccupation with CO2 is all well and good, but none of our carbon suppression efforts will save the earth from catostrophic events like melting ice sheets-- that train has left the station.

Instead, the scientists argue that we should be focusing on "fast action strategies" that target other pollutants like low level ozone, methane, soot, and hydrofluorocarbons. If we make a dent in these pollutants, then we can avoid the "tipping point" of a global 3.6 degree warm-up, which supposedly has apocalyptic implications.

More noise amid the cacophony of voices that is the climate change debate, or a game-changing environmental strategy? You decide...

Carbon dioxide not the only climate enemy [San Diego Union Tribune]

Solar Sparks Neighbor Wars

2009-11-30T09:15:00.001-08:00

Despite all the government incentives to install solar, it just gets harder and harder to... install solar.

We know all about the potential roadblocks to large-scale solar installations-- conservationists, NIMBY's who block transmission lines, etc., but conventional wisdom has always been that it is easier to put up single-home rooftop solar arrays. Now the Los Angeles Times dispells that myth with a look at the increasingly common courtroom fights between Homeowners' Associations and individual property owners who want to go solar.

More and more, HOA's are trying to block solar panels on individual properties, primarily for aesthetic purposes. Homeowners are fighting back, armed witha 1978 law called the Solar Rights Act which seeks to safeguard a property owner's right to install solar.

Language similar to the Solar Rights Bill was written into the House version of energy legislation earlier this year, but it could be struck in conference...

Solar Panels Causing Some Storms [Los Angeles Times]

The Devel You Know...

2009-11-24T15:07:00.000-08:00

PG&E's Diablo Canyon nuclear plant's operation license is set to expire in 2025. But PG&E isn't waiting to seek an extension. The company announced today that it will seek a 20 year extension from the Nuclear REgulatory Commission now. That would extend the life to 2045.

To put the 20 year extension in perspective, that is only 5 years longer than it took to build the reactor in the first place, which had to undergo years of earthquake testing.

Diablo Canyon is one of only two-- count 'em- tow nuclear plants in California. It produces enough energy to power 3 million homes each year.

PG&E Asks for 20 more years at Diablo Canyon [Pacific Coast Business Times]

Pack Up The Moving Van

2009-11-23T09:47:00.000-08:00

This is perhaps more a general economic commentary than an energy commentary, but because it involves a wind-energy start-up, I figure it's fair game for this space.

Windstream Technologies, Inc., is based in Manhattan Beach, just south of Los Angeles. The company makes small wind turbines called "turbomills," designed for use in urban settings. At first glance, Windstream appears to be just another of the many entrepreneurial start-ups seeking to take advantage of California's commitment to alternative energy.

Then this: Windstream put out a press release today announcing that the company is moving, lock, stock, and barrel, to Indiana, where it will site its development and production factility, create 260 local jobs, and "invest millions."

Most troubling is this quote from company founder Dan Bates: "It was clear from our first discussions that Indiana is looking to become a leader in the green economy and WindStream is proud to be part of that positive effort..."

The implication is that California is NOT trying to become a leader in the green economy.

Indidana offered tax credits, training grants, and facility improvements.

We have no way of knowing what, if anything, California offered because the company doesn't say, but you have to believe that the company wouldn't leave the beach in Southern California for rural southeast Indiana if the offer had been even close.

Is California committed to a green energy economy or just to green energy?

Wind Energy Startup Moving to Indiana [Insideinidianabusiness.com]

The Darker Side of SmartMeters

2009-11-20T09:56:00.000-08:00

As if PG&E didn't have enough problems with SmartMeters...

David Baker's article in today's San Francicso Chronicle reveals yet another nasty feature to the new technology: they allow PG&E to shut off power to a home remotely. No sending out a technician, just flip a switch.

So, in these "brother, can you spare a dime" days, it's a lot easier to cut off someone's electricity for non-payment. Apparently that fact is not lost on PG&E because the number of low-income homes that were cut off grew by more than 27% in the twelve month period ending in August.

The obvious question is, "If your SmartMeter fouls up and jacks up your electric bill to stratospheric levels, leaving you unable or unwilling to pay the erroneous bill, will PG&E cut you off?" An impossible question to answer, but the fact remains the utility COULD do it very easily.

SmartMeters are turning into a PR nightmare for PG&E.

Utility shut-offs soar for poor PG&E customers [San Francisco Chronicle]

Ignoring the Real Problems, State Will Now Regulate TV's

2009-11-19T10:20:00.000-08:00

By now you've probably herd that the TV regulations passed on 5-0 vote. Starting in 2011, some marginally onerous rules kick in governing how much power your TV can draw, then in 2013, the regs go from being marginally onerous to really onerous.

Currently about 75 of the California TV market would meet the 2011 standards, but that percentage plummets for the 2013 standards.

On the one hand, it is good news that 58-inch TV's and larger are exempt, but on the other hand, you are clearly overcompensating for some definicancy in your life if you own a 58-inch TV.

The Consumer Electronics Associatioin still might sue over the matter, which would just further gum up the legal system. A lose-lose proposition.

Televisions must use less energy, California regulators tell makers [Sacramento Bee]

Going In Different Directions

2009-11-18T08:54:00.000-08:00

If you read the print edition of the Wall Street Journal, there is an interesting juxtaposition of articles that says a lot about energy in this country today.

On page B4 is an article by Rebecca Smith about the new trend among traditional power companies (AES, Duke, Progess Energy) to JV with, or seek financing from, China. In AES's case, the company recently sold a 15% stake in the company to the Chinese sovereign wealth fund.

Smith notes that, in 2011 and 2012, energy companies have $100 billion in debt coming due that needs to be refinanced and banks may or may not be lending on that scale, so China is a palatable option.

Another interesting point in the Smith article is a quote from Duke's Chief Technology officer that states that the Chinese can build a coal-gasification plant in three years when it takes Duke and other US companies six. Is that due to superior technology and resources or does it stem from the regulatory requirements heaped on US companies?

Now for the juxtaposition....

On the facing page, page B5, Jerry DiColo has a piece about solar panel manufacturers cutting out local distributors and setting up relationships with teams of installers in local markets to sell and promote its brands.

This represents an invesment in local American companies that is possible, no doubt, because the panel manufacturers don't have the crushing debt load coming due that large energy companies do, and because they can count on a stimulus-bump in panel consumption.

Either way, it's a fairly stark portrait of two sectors within the energy industry going in two different directions....

U.S. Power Companies Seek Out Chines Allies [Wall Street Journal]

Solar Panel Makers Seek Local Ties [Wall Street Journal]

PG&E's SmartMeter Woes Spreading North

2009-11-17T09:51:00.000-08:00

First it was Bakersfield, now it's the Bay Area. Consumers are not happy with the new PG&E SmartMeters.

The San Jose Mercury News reports receiving 30 complaints from consumers after its story about the unrest in Bakersfield. The Merc also notes that TURN is collecting complaints which means the advocacy group is actively engaged on the issue.

Trial lawyers are creeping out of their coffins and sharpening their fangs... this issue is not going away.

More on the Bay Area developments in the Merc:

Complaints Grow About PG&E SmartMeters [San Jose Mercury News]

Opposition to Ivanpah Comes Out of Its Shell

2009-11-16T09:35:00.000-08:00

Last week we posted about the deal Brightsource (and its contractor Bechtel) cut with the unions to build the massive Ivanpah solar installation in San Bernardino County. At the time it seemed like all of the political prerequisites were in place (alternative energy, union jobs in a high unemployment areas, tax revenue, etc..) and that it would be smooth sailing for the project.

Not so fast says San Bernardino County Supervisor Brad Mitzvelt who is seeking to trump all of the aforementioned political assets with a turtle. Tortoise, actually-- lots of them. Desert tortoises.

In the latest manifestation of the clash between conservationists and alternative energy companies, Mitzfelt is arguing that the project will eat up too much invaluable habitat for the desert tortoise. He has the support of environmental groups.

Mitzfelt is also arguing that the revenue projections are specious becuase most of the economic benefit would go to Nevada and other parts of California.

Public hearings on the draft EIR are pending...stay tuned.

Mitzfelt: Put solar project somewhere else [San Bernardino Sun]

Was SMUD Ripped Off By Wall Street?

2009-11-13T08:39:00.001-08:00

SMUD filed a lawsuite in yesterday in federal court alleging that Goldman Sachs, Morgan Stanley, and Merill Lynch defrauded the utility by riggin bids related to the muncipal derivatives that SMUD invested in over a 9 year period. In the aggreagate, SMUD did more than a billion dollars worth of these deals.

Essentially what happed was that SMUD took money raised through bond offerings and, before spending it on designated projects, invested that money in municipal derivatives. Those derivatives were hedged with another kind of derivative. Competitive bidding among the firms involved would get SMUD the best deal, but now SMUD smells a rat and it is going after the Wall Street firms.

At least 6 other city and county governments around the country are filing similar suits.

SMUD lawsuit alleges it was defrauded by financial companies [Sacramento Bee]

Look For the Union Label

2009-11-12T10:42:00.000-08:00

Bechtel the general contactor on Brightsource's massive Ivanpah solar energy pant in San Beranrdino County, near the Nevada state line, has cut a deal with the unions reports Leslie Berkman of the Riverside Press Enterprise.

According to the Building and Construction Trades Council of Calfornia, the 440 MW facility will generate $250 million in union wages and 4 million man hours of work in an area that has been hit even harder than most of the rest of the country by the recession (current unemployment is 14.2%).

Inland Solar Project Tapping Large Union Workforce [Riverside Press Enterprise]

When It Comes to T-Ridge, Too Much Is Never Enough!

2009-11-11T09:33:00.000-08:00

The offshore drilling saga that is Tranquillon Ridge simply refuses to die. The project, which was killed by the State Lands Commission in January, could have new life, thanks to John Garamendi's election to Congress.

The erstwhile Lieutenant Governor and ardent foe of offshore drilling, cast the deciding "no" vote on the commission, but he's gone now, and it is largely expected that Arnold will appoing a new Lt. Gov who is pro-drilling, thus swaying a potential vote in PXP's favor.

The Ventura County Star has all the details, but the net-net is that PXP can re-submit an application for T-Ridge and it won't even have to do a new EIR because the last one is still fresh. Things could proceed very quickly.

Pedro Nava, perhaps the most outspoken foe of drilling in general and T-Ridge in particular, has vowed to fight the nomination of whomever Arnold names, in an effort to stall the process until Arnold gets out of office.

For more on the scenario, check out the Star's write-up:

Governor gains leverage in coast oil drilling fight [Ventura County Star]

Tell It To The Judge

2009-11-10T10:03:00.000-08:00

A few weeks ago, we told you about the widespread public anger over PG&E's Smartmeter program. Then we told you about PG&E stepping up to bail out the solar industry by agreeing to an Arnold-brokered deal to increase the amount of power taken through net-metering to 3.5%.

Well PG&E is back in the news for its Smartmeter program-- this time as the defendant in a class action lawsuit brought by a Bakersfield man who saw his bill double.

The company is fighting the suit. Details are in David Baker's write-up in the San Francisco Chrnicle:

PG&E sued over Smartmeters, soaring bills [San Francisco Chronicle]

Speaking Up for Nuclear

2009-11-09T09:41:00.001-08:00

Westinghouse Electric CEO Aris Candris published an oped in today's Wall Street Journal that, in making the case for more nuclear power, seeks to address every possible anti-nuclear argument. It also wraps itself in the political mantle of Barack Obama and embraces the political catch-phrase du jour-- job creation.

Dr. Candris (whose company builds nuclear power plants) sees an economic windfall for Westinghouse and he is putting on the full court press.

The line of argument basically goes like this:

- Electricity deman is projected to grow 21% by 2030;

- There is a national mandate to use more renewables;

- Barack likes nuclear and Barbara Boxer's and John Kerry's Senate bill provides federal loan guarantees to fund new nuclear plants;

- Nuclear means new jobs in engineering and design, and lots more in construtction;

- The French have figured out how to recycle spent nuclear fuel rods.

Conclusion: "What's the problem?"

Here's the link to the oped:

Why the U.S. Needs Nuclear Power [Wall Street Journal]

Go Fly A Kite!

2009-11-06T09:15:00.000-08:00

And from the news of the weird file, I commend to your attention, David Baker's piece in the San Francisco Chronicle today. (I suspect Baker had some fun with this one.)

Adding a new twist to wind energy, several companies have come out with prototype generators that seek to capitalize on high altitude wind, which is more reliable than wind patterns closer to the ground.

These efforts are, depending on your point of view, entrepreneurial, innovative, or just plane strange, but they include a giant kite, a massive inflatable ball, a skeltal, unmanned "helicopter," and a serpent.

Each would be tethered to the ground and float 1,000 feet or more (in the case of the helicopter thingy, Baker notes it could go as high as 24,000 feet), and transmit power to the ground via cables.

The need for "no fly zones" seems obvious, and that these inventions would have great difficulty transmitting power 24,000 feet to the ground and then who-knows-how-far to get the power into the grid, seems even more obvious.

However, such technology might be viable for isolated, remote areas such as mining camps and towns in the middle of nowhere.

Before I sound too snarky, I'll invoke the old business school cliche that "there are no bad ideas in brainstorming" so we'll give these inventors an "A for effort" and take a (long) wait and see position as to the viability of their technologies.

Inventors' high flying kites harnass wind power [San Francisco Chronicle]

Watching TV Is Still Ok

2009-11-05T09:18:00.000-08:00

There is a great scene in the neo-fraternity classic movie Old School, where the sycophantic assistant to the college Dean informs his boss that efforts to kick a rowdy fraternity off campus have been derailed because, "The thing is sir, they are very good at paperwork."

The same could be said of the Consumer Electronics Association which managed to postpone the CEC's vote on new regulations governing the kind of TV's Californians can watch in their homes.

The CEA availed itself of its right to use darn near every second of the 45 day public comment period for the regulations and submitted a 91 page brief to the CEC just five minutes before the period closed at 5 pm yesterday. The result? No vote, while the CEC sifts through the submission.

Additionally, 26 other comments were received yesterday by the CEC which could further slow the process.

California Delays Vote On Energy Efficiency Standards for TV's [San Jose Mercury News]

Toyota To Roll Out Innovative New EV Charging Stations

2009-11-04T08:42:00.000-08:00

In advance of the launch of the plug-in version of the Prius, Toyota is getting into the electric vehicle charging station business.

The company has announced plans to roll out individual charging 100-200 volt charging stations that will be anchored to telephone polls.

Two interesting features about these stations: 1) The stations will be the first to be solar powered, and 2) the stations communicate with a central computer that will authorize user access, thus giving Toyota a way to monetize the service by making it subscription based or perhaps even "pay as you go."

Nissan has also announced plans to roll out EV charging stations, as it too is preparing to launch a new electric vehicle next year.

Toyota enters the EV charger market [businessgreen.com]

The Other Side Weighs In On The TV Saga

2009-11-03T12:31:00.001-08:00

Last week we noted the absurdity of CARB's proposed regulation that would require metallic window glazing on cars (glazing that would impair GPS, cell phone, and other devices). Today we revisit the CEC's absurd proposed regualtion to ban some flat panel TV's in California.

Gary Shapiro is the CEO of the Consumer Electronics Association, which means he is a paid flack for the people who make and sell the TV's CEC wants to ban. We mention that for transparency. It's no secret where Shapiro's allegiance lies. That said, his oped in the San Francisco Chronicle makes a lot of very good points that-- regardless of the messenger-- need to be stated:

- The average flat panel tv uses less energy than two 75 watt lightbulbs.

- The proposed regulation, according to one study, will cost California $47 million in lost tax revenue and 4,000 jobs.

- The 700 models that would be banned for sale in California, can still be purchased on the Internet from out of state suppliers, which means people will just buy them online rather than in a local store, thus sending the money out of state.

- According to a Zogby poll, the majority of Californians are against the measure, and the majority of Californians believe government has no business picking someone's TV for them.

Read the entire oped at: TV energy regulations will harm innovation [San Francisco Chronicle]

Solar Schools

2009-11-02T08:58:00.000-08:00

The key to building grassroots support for any issue is public education. PG&E is taking that seriously when it comes to solar energy and is going back to school-- literally.

Through the "Solar Schools" program, the company has spent more than $8 million on a 125 schools in California, outfitting them with 1.3 KW solar arrays sufficient to power school operations, handing out "Bright Idea" grants, and working with the National Energy Education Development Project on school currculum about solar energy.

The Bright Ideas grants are $10,000 prizes awared to teachers and amisnistrators in fiver areas: educational solar projects, youth environmental programs, science-related field trips, "green your school" projects, and professional/workforce development programs.

PG&E Leads The Way With "Bright Ideas" For Renewable Energy [The Western Edition]

$30 Million in Tax Breaks Lures Tesla to SoCal

2009-10-30T08:56:00.000-07:00

Where is uber-chic electric car maker Tesla going to site its new assembly plant? Southern California, for sure, but it remains to be seen if a dormant Boeing facility in Long Beach or the Downey Studios in Downey will be the winner of the Tesla sweepstakes which carries a prize of 1,400 new jobs created.

The California Alternative Energy and Advanced Transportation Authority is granting $30 million in tax breaks.

Here's how it works:

Tesla will buy $320 million in equiment it needs to outfit the plant. It will then convey title of that equipment (i.e., "give") to the CAEATA, which under its charter, pays no sales tax. Then the CAEATA will give the equipment back to Tesla, so nobody ends up paying the 9% sales tax on the $320 million.

Apparently it's legal.

Read the story in the San Gabriel Tribune:

Tesla gets tax break, hopes to open plant in Southern California [San Gabriel Tribune]

Damned if you do, Damned if you don't...

2009-10-29T09:18:00.001-07:00

State Rep Ira Ruskin teams up with Environment California's Charlotte Glennie in an oped in today's Palo Alto Daily News in which they call out Arnold for his lack of leadership on green energy.

They claim that with "more substantial and tenacious leadership at the state level," we can create 200,000 new jobs in the clean energy sector.

What they are really miffed at the governor about is his veto of SB 14 and AB 64, which would have written the 33% RPS standard into law. Recall that Arnold did mandate 33% by Executive Order but that does nothing to placate Ruskin and Glennie.

Read the oped here: California must commit to more renewable energy [Pali Alto Daily News]

PG&E Going Above & Beyond on Net Metering

2009-10-28T09:08:00.000-07:00

When the bill to raise 2.5% cap on net metering stalled in the legislature, the solar industry had a problem. However, PG&E announced yesterday that it had cut a deal with the Governor to voluntrarily take up to 3.5%, a full point in excess of the legislated requirement. That gives net meterin a new lease on life, at least temporarily.

According to David Baker in the San Francisco Chronicle, PG&E had expected to hit the 2.5% threshold by 2011.

Read the whole story in the Chronicle:

PG&E to accept more solar power from homes [San Francisco Chronicle]

Yet Another Front In The Solar Wars

2009-10-27T09:46:00.001-07:00

Solar energy proponents are getting pretty adept at jumping through hoops in order to bring more capacity on line. First there were questions about the cost and efficacy of solar; then there were the problems related to building new transmission lines to service new solar farms; then there was the unexpected and ironic conflict between planned solar farms and sensitive desert ecology. Now a new obstacle has popped up: water.

With California in the throes of chronic drout, and a contentious legislative debate over water policy, the New York Times reports that two new solar farms slated for development will require over 1.2 million gallons of water for cooling purposes. You can imagine how that sounds to parched delta farmers and spoiled southern California homeowners who are watching their lawsn become more brown every day due to water restrictions.

According to the Times:

"The West’s water wars are likely to intensify with Pacific Gas and Electric’s announcement Monday that the utility will buy 500 megawatts of electricity from two solar power plant projects to be built in the California desert.

The Genesis Solar Energy Project would consume an estimated 536 million gallons of water a year while the Mojave Solar Project would pump 705 million gallons annually for power plant cooling, according to applications filed with the California Energy Commission."

At issue is "wet cooling" which requires constant replenishment of evaporating fluids, versus "dry cooling" which uses less water but is more expensive and eats into profit margins.

Water Use by Solar Projects Intensifies [New York Times- Green, Inc.]

Oil Tax Resurfaces

2009-10-26T08:42:00.001-07:00

As termed-out Rep. Pedro Nava runs for Attorney General, his controversial bill to create an oil severance tax is getting more attention. In a piece in Legalnewsline.com, the idea--which voters defeated a few years ago (Prop 87) and later revisited by Arnold-- is presented as a classic tax and spend proposal.

Nava gave his bill the tediously cliche title the "Oil Industry Fair Share Act." (Side note: whoever the pollster is who first focus grouped the phrase "fair share" and determined that it tested well enough to hang on every tax hike proposal ever put forth in any legislative body in America, should have copyrighted it-- he'd be a gazillionaire.)

Anyway, Nava claims that California is the only state not to have an oil severance tax and that because California produces so little oil in the grand, global scheme of things, it would not impact the cost of gas at the pump. (Nava estimates the tax to be worth $1.5 billion per year).

My immediate reaction to that comment is that Nava appears to believe the tax is ok, as long as oil production remains low. To put it another way, this is a bill designed as much to stifle oil production (no surprise to anyone familiar with Nava) as it is to raise revenue.

Legalnewsline.com obviously picked up on that too, because it points out that a respected consulting firm, Law and Economics Consulting Group, studied the impact of the bill and concluded that it would be a job and an industry killer :

"The report, released in January, estimated that the oil producers' tax could, among other things, cause steep declines in the state's oil and natural gas production and the loss of nearly 9,900 jobs."

California's oil production is already among the most heavily taxed in the country. This new oil tax would make California's combined taxes on petroleum the highest in the nation by far," the LECG report said.

AG candidate Nava to propose oil severance tax [Legalnewsline.com]

Micromanaging California Is NOT Cool

2009-10-23T08:34:00.000-07:00

CARB is at it again. At a time when California is reeling and on the brink of collapse, CARB is moving forward with what can only be called a silly distraction.

The agency wants to pass a regulation (just what California needs—more regulation) requiring car windows to be coated with a metallic glazing compound.

The idea, apparently, is to keep cars cooler requiring less air conditioning use which would save gas and cut down on fluorocarbons from air conditioners.

Dubbed the “Cool Cars” initiative, this will cost consumers more money at a time when money is tight, and it will add to the cost of a vehicle (one more line item on sticker price). But how much effect will it have? Will drivers truly stop using their air conditioners?

If the recent ban on handheld cell phones in cars—which appears to have about 1% compliance where I live—is any indication, regulations don’t change consumer behavior.

Opponents of the proposed reg point out that the new glazing wreaks havoc on cell phone signals, gps signals, and just about any other wireless gadget /toy that Californians rely on in their cars.

So we are now facing a potential ban on big screen TV’s and mandatory window glazing in cars.

Is that really the best use of our legislative and regulatory resources at time when the state is literally about to collapse under the weight of fiscal deficits, underfunded pensions, decaying infrastructure, overcrowded prisons, lack of health care, hopelessly challenged schools, devastating out-migration, and an overall lack of resources?

In this context, the Cool Cars initiative is anything but cool...

New Meters Leave PG&E Customers Smarting

2009-10-22T10:49:00.000-07:00

The natives are restless. PG&E got an earful from angry customers who are a tad bit miffed at their new PG&E smart meters. The Fresno Bee reports that more than a hundred people attended a town hall meeting called by Dean Florez, and nary a person spoke up in favor of the smart meters which ratepayers say have cause major spikes in their bills.

One person noted that his $500 a month bill more than doubled to more than $1,100.

For it's part, PG&E blamed hot weather and recent PUC rate hikes, but that message was lost on the angry mob which resorted to using the "F-word." (Fraud... Not the other F-Word... although I bet that was tossed out too, just not reported.)

What is striking about the meeting is that it went a full 4.5 hours and not a single person spoke in favor of smart meters.

Addressing the question of the reliability of smart meters, the PG&E rep in attendance noted that there are 1.7 million smart meters installed and the companyhas tested 1,700 of them-- 1%. Not surprisingly, Florez and others balked at the sameple size.

In a post this spring, I posted a quote from a Business Week piece on smart grid technology that said the following:

"In particular, they're leery of giving utilities the ability to change electricity prices on the fly, jacking rates up on hot summer days, for instance. Most utilities are prohibited from using variable prices now, but the flexibility to raise rates for a community as demand rises is essential for utilities to get the full benefit of new technology. Consumer groups worry these so-called smart-grid technologies are just another way for utilities to make extra money off consumers."

Sounds like the chickens have officially come home to roost.

Crowd vents on PG&E meters at Fresno hearing [Fresno Bee]

Doing the Math on Home Solar

2009-10-21T08:33:00.000-07:00

So we know it is impossible to build a large, commercial solar project in California, but how about installing solar at your house? The Desert Sun has a reality check on home solar today, and does a deep-dive analysis on the three primary options for getting it done.

The Sun looks at home solar from a return-on-investment perspective and concludes that it is definitely not for everyone.

Basically there are three basic options for financing the approximately $28,000 project: get a home equity loan, a zero interest loan, or enter into a lease agreement with a solar provider.

Critically important factors that most people fail to include in back of the envelope solar calculations are things like financing costs and eligiblity for tax breaks.

The take-away on the analysis was that home equity loans are nearly impossible to get right now because banks are not lending, zero interest loans are a ticking time bomb that can morph into credit-card-like interest rates after a year, and solar leases disqualify homeowners from federal tax credits because they don't "own" the solar array.

So I gues the net-net is, if you can write a $28,000 check, solar is a good investment for your house, but if you can't it could be a non-starter or-- worse-- an enormous problem down the road.

Does it always pay to go solar? [Desert Sun]

Good Luck Chuck!

2009-10-20T07:33:00.000-07:00

I admit to having a soft spot for Chuck DeVore (it's a nuclear thing, you wouldn't understand).

He sat down for an interview that was posted on Sandiegonewsroom.com yesterday and covered a variety of topics relative to his (some would say "quixotic") campaign for the U.S. Senate.

In the interview, he called Cap & Trade "insane"; AB 32 a "bad law"; and he claims that Democrats in Sacramento are routinely "freaked out" when construction unions join him in supporting more nuclear power plants.

There is something refreshing about a plain spoken politician-- even one who is facing a really big uphill challenge.

You can check out the entire transcipt here:

Chuck DeVore on today's big issues and why he wants to take down Boxer [San Diego Newsroom.com]

All This Time and Nothing's Changed!

2009-10-19T13:58:00.001-07:00

Has it really been a month? I feel a little like Rip Van Winkle... anyway, a short break followed by a two week vacation and it's back on line!

What is just as amazing as how fast time flies, is that nothing ever seems to change!

The top story in my aggregator this morning as from the Los Angeles Times about how environmental regualtions are slowing large-scale solar developments in the desert. How long have we been talking about this?

According to the Times:

"Companies are racing to finalize their permits and break ground by the end of next year, which would qualify them to obtain some of the $15 billion in federal stimulus funds designated for renewable energy projects.

At stake is the creation of 48,000 jobs and more than 5,300 megawatts of new energy, enough to power almost 1.8 million homes, according to federal land managers. But the presence of sensitive habitat, rare plants and imperiled creatures such as desert tortoises, bighorn sheep and flat-tailed horned lizards threatens to stall or derail some of the projects closest to securing permits."

The Times write-up doubles down on the regulatory gridlock that is keeping these projects in limbo by noting that, in addition to environmental issues, government bureacracy is now making the problem worse. Between fuloughs and budget cuts, state agencies simply cannot keep up with the paperwork.

I suppose the story is a microcosm for just about everything else that is going on in California... judge for yourself:

Environmental concerns delay solar projects in California desert [Los Angeles Times]

Whitman On AB 32: Just Say No!

2009-09-18T09:56:00.000-07:00

Tip 'o the hat to Wyatt Buchanan at the San Francisco Chronicle for posting on Meg Whitman's oped in the Merc on Thursday... I completley missed it. If you did too, Whitman came out and said that on Day 1 as governor, she would suspend AB 32 and reform CEQA.

In this election season, them's fighing words!

Here are some choice pull quotes form her oped:

"With this ongoing economic crisis, the governor has the ability to issue an executive order putting a moratorium on most AB32-related rules. I urge him to do so. And if he does not, I will issue that order on my first day as governor.

We first must get our economy back on track. In January, the first AB32 mandates take effect and will lead to higher energy costs at a time when we can least afford them. They will discourage job creation and could kill any recovery.

Meanwhile, Congress is working on its own version of AB32. We can't measure the true impact of AB32 on California's economy until we know what the federal standards will be. So a moratorium now on AB32 would give us an opportunity to coordinate our environmental efforts with Washington. And if we do it right, it might save California businesses time and money. This is surely preferable to even more jobs fleeing our state.

The California Environmental Quality Act, or CEQA, is also ripe for reform. It is a jumble of ambiguous rules that require environmental analysis of projects ranging from a nuclear power plant to bike lanes. Over time, CEQA has been expanded way beyond what the Legislature originally intended. It often eats up time and money and discourages business expansion."

Opinion: To create jobs, curb environmental regulation [San Jose Mercury News]

Candidates Go Nuclear

2009-09-17T10:32:00.001-07:00

At a gubernatorial candidate forum put on last night by the Silicaon Valley Leadership Group, every major candidate from both parties embraced nuclear power! (Meg Whitman, a Republican, was a no-show because she was speaking at a conference in San Diego).

Politically, the issue was a no-brainer for Republicans Tom Campbell and Steve Poizner, but Democrats Jerry Brown and Gavin Newsom have to keep manage their liberal Democratic base which is decidedly anti-nukes. Newsom was the most cautious, giving a tortured political response about seeking solar and wind alternatives first, but not ruling out nuclear power entirely.

Currently, nuclear power accounts for 15% of Claifornia's power but there is a moratorium on new nuclear construction until we can come up with a solution to the problem of storing nuclear waste.

Governor contenders toss around nuclear power [San Francisco Chronicle]

It's Official

2009-09-16T10:26:00.001-07:00

Arnold has declared by Executive Order that California's utilities will now need to get 33% of their power from renewable sources by 2020.

On its face, this seems like an environmentally progressive move, but everyone from environmentalists to labor is not happy about the way it was done, and even though the new standard is legally authorized under AB 32, questions remain about how much force of law it will have after the Governor leaves office.

One of several stories on the announcement is in the Los Angeles Times:

Schwarzenegger orders more renewable energy -- his way [Los Angeles Times]

Without Net Metering, Solar Isn't So Attractive

2009-09-15T11:04:00.000-07:00

Another casuality of the mad scramble at the end of the legilsative session was AB 560, Nancy Skinner's bill to double the cap on net metering from 2.5% to 5%. The bill really would have only affected PG&E which is the only utility nearing its 2.5% cap, but it's failure to pass could send a chill through the California solar industry.

Under net-metering, solar-equipped homes can send excess power back into the grid, drastically lowering their utility bills. However, a the amount of solar power a utility can take back from ratpayers is capped at 2.5% of its peak load.

The bill got bogged down by amendments governing contractor licensure that labor groups pushed for.

California Legislature inaction dims solar power savings [Sacramento bee]

Arnold To Take Matters Into His Own Hands

2009-09-14T10:08:00.000-07:00

So no compromise was reached last week and both SB 14 and AB 64 are going to be vetoed by the governor this week. The good news (for fans of a 33% RPS) is that the Governor is expected to issue an executive order this week that mandates the new standard; the bad news is that there are serious questions about what--if anything-- this means once the Governor leaves. office.

Interestingly, the Executive Order supposedly will include nuclear power among the other traditional green energy options (solar, wind, etc...)

Full write-up is in the Los Angeles Times:

Schwarzenegger may order a change in green energy rules [Los Angeles Times]

Still Waiting on 33%; SDG&E Plan to Cut Power Goes Down in Flames

2009-09-11T09:29:00.000-07:00

As of Friday morning there was still no deal on consensus legislation to increase the state RPS to 33%. According to an Associated Press write-up:

"Democrats are pushing two bills that would require utilities to get a third of their power from renewable energy sources by 2020. It would be the most aggressive such standard in the nation.

How and where utilities would be allowed to get that energy remains a point of contention between the utilities, producers of renewable power, environmental groups and consumer advocates.

California already has one of the most aggressive standards of the 31 states that require utilities to generate a certain amount of their power from renewable sources, according to the Arlington, Va.-based Pew Center on Global Climate Change. In Hawaii, utilities must generate 40 percent of their power from renewable sources by 2030 — a longer timeframe than the goal being considered in California.

The Senate and Assembly are expected to vote on two companion bills by the end of Friday, the last day of the regular legislative session. Neither bill had Republican support in committee."

Elswhere, the PUC killed SDG&E's plan to shut off power to back country consumers during fire-prone weather conditions (high winds, low humidity). The vote was 4-1.

The Los Angeles Times reports:

" Opponents said the shut-off plan would endanger back-country residents by leaving them without electricity to pump water onto small fires. About 17 areas with 60,000 customers were targeted for shutoffs when humidity was low and winds hit a sustained rate of 35 mph or gusts up to 50 mph."

Calif. lawmakers weigh rules on renewable energy [Associated Press]

PUC rejects San Diego utility's plan to turn off power during high winds [Los Angeles Times]

REC's & Out of State Power Deliveries Stymying a 33% Deal

2009-09-10T10:38:00.000-07:00

Capitol Weekly reports that, as of yesterday, intense disagreement over the nature and role of REC's and over the timing of out of state power deliveries were holding up a deal on a Senate bill legislating a bump in the RPS to 33%.

Capitol Weekly:

"By Tuesday afternoon, the package remained a work in progress, four days before the end of the legislative session. Negotiators included representatives of business, manufacturing, the investor-owned utilities, the public utilities, the environmentalists and regulators, among others.

The sticking points included details of renewable energy credits, which could be bought and sold on the open market, and the delivery and timing of out-of-state power coming into California.

There also were questions of whether existing power contracts can be grandfathered in, and the extent of provisions that would ease the rules on utilities if they were forced to buy renewable power at 6 percent or more above a market benchmark.

The sharpest opposition came from the manufacturers, who purchase large amounts of electricity. Aside from the cost, they note that the state Air Resources Board, which enforces the state’s landmark greenhouse gas emissions law, also has authority to the renewables to 33 percent, according to a scoping plan adopted by the board. "

Renewable power: People love it, but devil is in the details: Capitol Weekly

Still More on T-Ridge

2009-09-09T11:03:00.000-07:00

KQED's Sacramento Bureau Chief John Meyers does a big story today on one of our favorite topics.... T-Ridge!

Here's a link to the blog post and the audio: Drill, Maybe Drill.

The 33% Pipe Dream

2009-09-08T11:07:00.000-07:00

Last week we posted about the scramble to find a path forward to the 33% goal prescribed by Gov. Schwarzenegger. Today, Southern California Edison CEO Alan Fohrer, in published commentary in the Los Angeles Times, says, Fuggeddaboutit. Aint happening.

Fohrer argues that, political will aside, it simply isn't possible to hit the 33% benchmark by 2020.

He points out the following:

Utilities need to be able to supplement the renewable power they produce in California with renewable power purchased from outside California. Until Sacramento is willing to let that happen, 33% just is not achievable.

Second, to transmit all of the new renewable energy from the remote spots across the state where the sun shines most and the wind blows hardest, you need transmission lines-- 11 new transmission lines to be exact. And given that each transmission line takes-- on average-- 10 years to build, the 2020 deadline isn't realistic.

Third, because we don't yet have a good way of storing renewable energy, we need fill-in power from traditional generating sources to backstop the state when the sun isn't shining or the wind isn't blowing. That means more power plants, but given air quality regulations and environmental mandates, the number of power plants is actually declining, not increasing.

Finally, CalISO estimates that achieving the 33% benchmark will cost $115 billion. Ultimately a hefty portion of that would have to be passed on to ratepayers. Dealbreaker.

Reality can be sobering.

Why 33% renewables by 2020 may be impossible [Los Angeles Times]

Checked Out!

2009-09-04T06:55:00.001-07:00

Happy Labor Day weekend! Last big weekend of the summer-- enjoy it!

The Great Solar Upheaval

2009-09-03T09:29:00.000-07:00

Spain, one of the global leaders in government-incentivized development of alternative energy, decided to stop subsidizing solar installations. The move exacerbated an already chaotic solar industry worldwide, and has policy wonks debating what the decision means for government incentives for renewable energy in general.

Dow Jones columnist Jamie Miyazaki sees a "bloodbath" in the solar industry that stems from a perfect storm of low cost Asian suppliers, polysilicon supply shortages, and the Spanish policy shift.

She opines that, to survive, companies will need to vertically integrate or outsource, but that cash-rich companies could swoop in and make relatively inexpensive acquisitions from among the carnage once this all plays out. Hopefully, the entire episode will result in market prices that are competitive even in the absence of subsidies.

But what of the policy implications? The larger question of "should governments continue to subsidize solar and other forms of alternative energy?" looms large.

Proponents of government subsidies look at the Spain case sudy and note that government assistance is critical to establishing the necessary infrastructure to capitalize on alternative energy. However, after that infrastructure is in place, subsidies become less important.

Detractors argue that governments are creating bubbles that ultimately will burst, to the detriment of the larger economy.

The Wall Street Journal takes a deeper dive into the policy side of the solar upheaval:

"The U.S. is experimenting with different ways to promote clean energy, including tax incentives and direct federal subsidies to defray installation costs, and mandates for utilities to get a certain amount of their power from renewable energy.

California and New Jersey, which lead the U.S. in solar power, are among states that have used subsidies similar to the ones in Spain to make solar power more attractive. Two House Democrats, Jay Inslee of Washington and Bill Delahunt of Massachusetts, are drafting legislation that would create European-style tariffs for solar power.

The industry's fundamental problem is that, without subsidies, it's still not economically viable."

Spain's Solar-Power Collapse Dims Subsidy Model [Wall Street Journal]

Follow The Money

2009-09-02T09:03:00.000-07:00

Further evidence that investment dollars are staring to flow to clean energy projects (but not in the biofuel sector), the Los Angeles Times reports that Vinod Khosla, the famous Silicon Valley financier, has raised $1 billion for a fund that will invest in early and mid-stage companies in the green tech space.

According to the Times:

"It is the biggest first-time fund in a decade and comes as venture capital investment in green technology is just beginning to recover from a precipitous fall prompted by the global economic collapse last fall. In the first half of the year, investments in green tech plunged to $513 million from $2 billion in the first six months of 2008, according to a survey by PricewaterhouseCoopers."

Separately, the Wall Street Journal notes that all of the public sector money flowing to alternative energy deals through federal grants and tax incentives, is largely going to the benefit of foregin company companies that own the ventures, directly or indirectly.

More fodder for the debate over the role of government in private enterprise?

Khosla Ventures raises $1.1 billion to invest in green technology [Los Angeles Times]

U.S. Doles Out Grants for Energy Projects [Wall Street Journal]

Sempra Leads the Pack in Smart Grid Adaptation

2009-09-01T11:17:00.001-07:00

Intelligent Utility Magazine is out with its national survey of smart grid adaptation by major utilities, and Sempra ranks first in the nation:

"In 2008, the company installed 4,500 smart devices on San Diego homes and businesses, making it one of the first utilities in America to meter up its customers. The move was a first step in a half a billion dollar effort to convert 1.4 million aging meters by the end of 2011.

This month, Sempra subsidiary San Diego Gas & Electric was picked as a part of a $99.8 million federal grant to help make the city's grid plug-in ready for the cars of the future."

But the write-up notes that "optimism" about progress should not obscure the reason it undertook the survey in the first place:

"today's smart grid hype must be separated from reality. Utilities are anticipated to be the drivers behind mass smart-grid adoption. And the truth is, none of the nation's "intelligent" utilities is even close to being all the way there. Many still lack a long-term smart-grid roadmap."

In its report on the survey, the solveclimate.com blog calls today's grid a "dirty energy suck" and notes that smart grids are the "vital cure."

2009 Smart Grid Rankings Are Out: California’s Sempra Energy in 1st [solveclimate.com]

What's the Plan?

2009-08-31T09:28:00.001-07:00

Two weeks to go in the legislative year and we are still no closer to having an actual "plan" for getting California to the 33% renewable energy mandate that Gov. Schwarzenegger laid out in his Executive Order last November.

Stakeholders are locked in intense negotiations, with no signs that a compromise is imminent.

Writing in the San Deigo Union Tribune, Michael Gardner breaks down the political positions and the sticking points. Primarily it comes down to the impact on ratepayers (i.e., how much bills are going to go up and what, if any, legislated caps will blunt those raises), infrastrucuture construction, and crediting out of state renewable power purchases.

Green Energy Plan is Tall Task for the State [San Diego Union Tribune]

What Happened to Biofuels?

2009-08-28T08:47:00.000-07:00

Earlier this week Ann Davis and Russell Gold reported in the Wall Street Journal about the state of the biofuel industry. It was an eye-opening...

The entire industy is under siege, fighting a multi-front war that includes too much capacity, depressed fossile fuel prices, a delay in favorable federal regulations that would promote the use of biofuels, and a dearth of investment capital.

According to the Journal's report, two-thirds of the nation's biofuel capacity sits idle.

Earlier this year, two earth-shattering events potentially scared investors away for a long time. GreenHunter Energy, the largest biofuel refinery in the country, shut down. Cello Energy in Alabama, which had some big time names in the Venture Capital community behind it, was found to have defrauded investors. This does not bode well for buoyed investor confidence in the biofuel sector.

The result of this perfect storm of problems is that there will not be enough biofuel produced to meet the legislated blending targets that were passed in 2007.

Amidst this carnage, however, sits ethanol, which the reporters credibly point out, is politically untouchable.

U.S. Biofuel Boom Running on Empty [Wall Street Journal]

Kicking CALSTRS While It's Down

2009-08-27T09:13:00.000-07:00

This is a nice follow-up to yesterday's post about wind energy investment...

CALSTRS, the California teachers pension fund is taking heat for causing "social injury" in England.

As if being a California pension fund isn't miserable enough these days (the Sacramento Bee reports that the CALSTRS lost $42 billion last year), now CALSTRS has to deal with this?

The deal is that some British NIMBY's in the county of Kent are ballistic over a 420 foot wind turbine that the the locals claim would be built on an apple and plumb farm and be close enough to houses to be a "noisly nuisance."

Bloody hell!

The best part of this is that CALSTRS isn't even directly involved. It has a $63 million investment (chump change) in Hg Renewable, a hedge fund that claims to be the biggest fund in the world focused solely on European renewable projects. Hg Renewable is the one that financed the wind turbine.

So if you're CALSTRS and you just lost $42 billion, and now you can't even invest in a green energy fund without getting excoriated in the press, it might be time to go to cash or start buying T Bills.

British Activists Angry Over CalSTRS Wind-Power Investment [Sacramento Bee]

Investors Returning to the Renewable Energy Sector?

2009-08-26T08:51:00.000-07:00

As the economy soured, more and more renewable energy development deals were put on hold because the financing just wasn't there. The most high profile shelving was T. Boone Pickens' decision to mothball his massive wind energy project in Texas.

Now, however, with the economy showing signs of life, private equity investors are looking to put to work some of the cash they have been holding on their balance sheets. Add on government stimulus incentives for renewable energy development and we could be on the cusp of a new wave of alternative energy infrastructure development.

News of private equity investor Guy Hands' commitment ot acquire a controlling stake in EverPower for $350 million is all over the wires today. EverPower is a New York based wind energy concern that is developing projects in Oregon, Ohio, Pennsylvania and New York.

The Cost of Doing Business

2009-08-25T10:23:00.000-07:00

The New York Times yesterday took a look at PG&E's new deal with Brightsource. What's interesting about the deal is that the rates PG&E will pay will be contingent on Brightsource getting federal loan guarantees from the Energy Department. If not, the company will be looking at much, much higher financing costs, and those costs will be passed through to PG&E through higher rates.

The Division of Ratepayer Advocates couldn't stand the deal and pointed out that Brightsource did a similar deal with Edison that included no contingecy rate increases.

As the Times pointed out, renewable energy deals represent fairly significant credit risks in these still dicey economic times and, absent federal loan guarantees, deals are going to be expensive.

A Rare Peek at Green Energy Economics [New York Times]

Hanging Numbers on Climate Change Legislation

2009-08-24T08:30:00.000-07:00

When creating policy, or horestrading for votes, it is critically impotant to "hang some numbers" on whatever bill you are selling or fighting. How many jobs will it create/kill? How much revenue will it generate? How much will taxes have to be raised?

All of this is critically important to legisation's passage or failure, but none of it really means anything because everybody has their own set of numbers, depending on whether they are for or against the issue.

The latest set of "numbers" to make headlines comes from the American Petroleum Insitute, which has a predictably negative point of view when it comes to Waxman Markey. Today, API is releasing a report that calculates "the cost" of implementing the Waxman Markey bill.

Here are some expected highlights:

- By 2030, U.S. refining production could drop 17%

- The U.S. could end up relying on other countries for 19.4% of its refined fuel -- nearly twice the amount it imports today.

- The bill requires refiners to have permits for nearly half of U.S. carbon-dioxide emissions, though the industry would receive only about 2.25% of the total emissions allowances. The electricity-generating sector, also a major source of greenhouse gases, obtained a larger share of the allowances.

- Average U.S. refinery output would drop to 12 million barrels a day in 2030 from about 14.5 million barrels a day currently, if nuclear power, technology to reduce carbon emissions and the use of international offsets fail to become widespread. Refinery utilization rates could drop to 63.4%, from about 83% today.

- Without the restrictions of a Waxman-Markey bill, U.S. production rates would grow to an average 16.4 million barrels a day in 2030, according to the study.

These numbers could be accurate, or they could be pie in the sky lobbying fluff. One thing is for sure, though, they won't be alone. Expect them to be rebutted, fast.

Oil Industry Details Costs of Climate Bill [Wall Street Journal]

Pulling the Plug on SDG&E's Plan to Pull the Plug

2009-08-21T08:53:00.000-07:00

I remember on my first trip to Sacramento, commenting to a colleague who had picked me up the airport, that the clusters of homes next to the freeway appeared to have fallen out of the sky-- there was nothing else around them. My colleague commented, "Yeah, they're built in the middle of a flood plain."

That didn't make a whole lot of sense then or now, but putting homes where nature never intended them to be is something of a California thing.

Several hundred miles to the south, the problem of home-creep is a hot one, not a wet one. Wildfire dangers to homeowners who live in fire-prone areas have demanded some out of the box solutions, like the one SDG&E has been pushing for some time now-- cutting power to homes in fire prone areas when fire danger is high.

It has been controversial, to say the least. The utility argues that it is the only responsible thing to do, and after the fires of 2007, it is hard to disagree with them.

Writing in the San Diego Union Tribune, Mike Gardner notes, "The utility company came up with the plan after being sued by insurers, homeowners and government agencies in the aftermath of three large fires in 2007 sparked by arcing power lines. SDG&E has paid out $740 million in settlements so far. "

But, the 55,000 potentially affected homeowners and other stakeholders are crying foul and they are playing every card in the book-- from arguing that shutting off electricity will endanger the lives of elderly or disabled residents, and potentially hinder firefighting efforts by rendering water pumps inoperable.

Yesterday the PUC threw in the shut-off plan's detractors, issuing a preliminary injunction against the plan, by a 3-2 vote. The plan's fate hangs in the balance next month when, on September 10, the commission takes up the measure for a final decision.

There are merits to both sides' positions, but the entire situation begs the larger question of whether we shouldn't be smarter about where we site and build homes.

State halts SDG&E plan to cut rural area power [San Diego Union Tribune]

Natural Gas To Flex Lobbying Muscle

2009-08-20T08:33:00.000-07:00

The natural gas industry has its back up against the wall. It got absolutely rolled by the Waxman-Markey bill which favors clean coal over natural gas, there is an oversupply of gas right now which has driven prices way down, and recent discoveries of gas deposits promise promise to skew the supply-demand curve even further.

As a result, the industry has made influencing Waxman Markey in the Senate its immediate priority. To that end, enter "America's Natural Gas Alliance," a new $80 million lobbying coalition that includes natural gas producers such as Chesapeake, XTO, and Devon Energy.

According to the Wall Street Journal:

"The gas-industry's goals in the Senate include incentives that will encourage power companies to switch to natural gas from coal and lead truck fleets to convert to natural gas from diesel. Lobbyists will also seek to limit companies' ability to atone for their pollution via carbon "offsets," such as planting trees overseas, which reduce the incentive to switch to cleaner fuels like gas."

However the Journal cautions that, "...the gas industry must overcome major hurdles. Other energy producers are also mobilizing. A major theme of the coal industry has been the relatively stable price of coal compared with volatile natural-gas prices. Meanwhile, major natural-gas consumers, including chemical companies and many utilities, oppose increased use of natural gas because it could drive up costs."

Gas Industry Girds to Fight in the Senate Over Climate [Wall Street Journal]

PG&E Tightens Its Grip

2009-08-18T08:38:00.000-07:00

One of the more persistent arguments made during the recent budget mess was that California is essentially ungovernable because the ballot initiative process has effectively made it so.

Similar to Dennis Miller's comedic observation about the absurdity of publicly accessible emergency brakes on trains ("I don’t want to be on any form of transportation where the public has access to the f#*king brakes, okay? I’d hate to hear that I die in some horrific train accident because while we were rolling along at a hundred-miles-per-hour, Gus thought he saw a woodchuck.”), many argue persuasively giving special interests the ability to rewrite the state Consitution to their own economic benefit, has consequences.

Here's more grist for that argument.

According to a David Baker piece in today's San Francisco Chronicle, PG&E poured three quarters of a million dollars into a ballot initiative campaign that seeks to restrict the ability of local governments to extricate themelves from the grip of large utilities and start selling their own electricity. Specifically, the ballot measure would force a 2/3 vote of local citizens.

Ironically, a PG&E spokesman stated that "PG&E supports giving its customers more control over how their hard-earned tax dollars are being spent". This, of course begs the question of how much control ratepayers have over how their hard-earned dollars are spent. On ballot initiative campaigns, apparently.

PG&E backs measure to tighten grip on cities [San Francisco Chronicle]

Boone & Ted's Excellent Adventure

2009-08-17T09:13:00.000-07:00

It sounds like the set-up to a bad joke, "Ted Turner and T. Boone Pickens go into a bar..."

Only, in this case it isn't a bar, but another stop on the Ted & Boone media tour to promote Pickens' (and Turners's) investment portfolios.

For several months Turner and Pickens have been making the rounds talking about natural gas and renewable energy. You know all about the Pickens Plan, and Turner's reputation preceeds him on just about every front, but today's co-bylined oped in the Wall Street Journal rehashes the same arguments that they have been making ad nauseum, with a few new facts and some good pull-quotes.

Here's the lede (stop me if you've heard this before):

"Renewable energy and clean-burning natural gas are the basis of a new strategy the world needs to create a cleaner and more secure future. And the global transformation to a clean-energy economy may be the greatest economic opportunity of the 21st century."

But here is something new-- a "cash for clunkers" proposal for power plants:

"In the electricity sector, natural gas is already cheap, available and ready to meet the nation's power needs while improving climate security. It emits about half the carbon dioxide per British thermal unit of energy, and far fewer of the heavy metals than does coal.
Adopting a "cash-for-clunkers" program in the utility sector can save money and reduce emissions right away by retiring the oldest, least efficient and most polluting power plants in exchange for modern gas-powered plants. New coal plants should be required to combine natural gas with the coal they burn, resulting in cleaner emissions, and every power plant should meet strict carbon-emissions standards."

It's no secret that Pickens, in particular, has investments that span the entire natural gas spectrum and he stands to make a gazillion dollars if even a fraction of the Pickens Plan is adopted, but from a policy point of view, one has to consider if this is just a get-richer-quick scheme or if it has merit?

As we posted a couple of weeks ago, targeting only stationary sources (power plants) when, by Pickens's and Turner's own admission 70% of imported oil gets slurped up by vehicles, makes it kind of a specious argument...

New Priorities For Our Energy Future [Wall Street Journal]

Power Line Problems Loom Large

2009-08-14T08:59:00.000-07:00

The state is trying to get out in front of the environmentalist and NIMBY opposition that is sure to come when it tries to build out new power lines necessary to transmit all of the new electricity generated from contmeplated renewable projects.

A consortium called the Renewable Energy Transmission Initiative, which consists of state agencies, utilities, and developers has come together to study the problem and make siting recommendations. The San Francisco Chornicle reports that the consortium's report issued this week looks at:

"...where transmission lines are needed most, will cost the least and will cause the least harm to the environment. It doesn't recommend exact routes, nor does it specify how many lines must be built.

Instead, it presents options, suggesting broad pathways for lines that can link planned renewable power projects to the grid. Most of the proposed lines are in the Southern California desert, while one stretches to the Oregon border. "

The Chronicle also notes that, "Together, those places could generate as much as 77,526 megawatts of electricity, more than all of California uses on a typical summer day. A megawatt is a snapshot figure, representing the amount of electricity flowing across the grid in an instant, and 1 megawatt is enough to power 750 homes."

Plotting the path of renewable power lines [San Francisco Chronicle]

PG&E Remains Committed to Wave Energy

2009-08-13T09:17:00.000-07:00

The New York Times takes a look at PG&E's efforts to develop wave energy. Last year a court struck down one demonstration project and now documents filed by the utility with FERC show that PG&E has voluntarily dropped plans for another in Mendocino County.

Plans are moving forward with a project off of Humboldt County, to which many wave energy detractors are asking "What is PG&E smoking??" (sorry, gratuitous Humboldt County joke...)

According to the Times:

"In 2007, the utility had applied for federal permits to explore the feasibility of placing wave energy generators in the Pacific Ocean off the coast of Humboldt and Mendocino counties.The scuttling of the Mendocino project is just the latest setback for wave power.

Last year, California regulators also declined to approve a P.G.& E. contract to buy a small amount of electricity from a Northern California wave farm to be built by Finavera Renewables, on the grounds the project was not viable.

Despite the difficulties, P.G.& E. is pushing forward with a similar wave project in Humboldt county. The utility has cut that project’s size to 18 square miles from 136 square miles as it zeroes in on the most productive areas of the ocean. Jana Morris, a P.G.& E. spokeswoman, said that the utility expects to file a draft pilot license application for the project in the spring of 2010."

In addition to all of the existing logistical challenges to making wave energy work, the dreaded "fish card" has yet to be played to its full effect. If potentially endangering fish can disrupt a significant portion of the water delivery system onshore in California, just imagine what it can do out in the ocean...

Wave Power Setbacks in California [New York Times]

Will Clean Coal Work?

2009-08-12T09:03:00.000-07:00

Yesterday the Washington Post ran a lengthy piece about the potential and technological limitations of "clean coal" technology. Essentially, clean coal is all about capturing carbon emissions and burying them underground. But with the best estimates predicting that the technology is still 6-10 years away from being commercially viable, there are still a lot of questions to be answered.

The Post reports:

"Coal companies and environmentalists alike are counting on a breakthrough in carbon capture and storage technology to siphon off harmful emissions from the world's coal plants. Coal plants in the United States account for a third of U.S. greenhouse emissions. In the past five years China has brought online coal-fired electricity equal in size to total U.S. installed capacity, and new plants are coming online in the developing world all the time. Without a breakthrough on coal plants, it may be impossible to meet emission limits climatologists say are needed.

Yet carbon capture and storage remains the elusive holy grail of the coal industry, an idea that could contain the damage inflicted by coal-burning power plants but a technology that remains expensive, energy intensive and largely untested. Even optimists say it will not be commercially available for another six to 10 years. Pessimists say it might take much longer, and may never be ready for widespread use without attaching a punishingly high price to carbon."

"But the AEP project illustrates the tremendous obstacles ahead. As big as it is, the equipment there will only capture the emissions from 20 megawatts of power generation, a meager 15 percent of the plant's output. Morris's predecessors were smart enough to buy lots of extra land at the West Virginia plant, but other coal plants would have trouble finding room."

"The huge carbon capture and storage devices are hugely expensive, too. AEP executives estimate that the cost of carbon capture for a modest-size coal plant of about 235 megawatts would start at $700 million. That works out to about $100 for a ton of carbon dioxide, far above the projections made by the Environmental Protection Agency about prices under a cap-and-trade scheme similar to one passed by the House in June. MIT put the cost of carbon capture and storage at $50 to $70 a ton. (The Waxman-Markey bill would give the first six gigawatts of plants -- equal to around seven average-sized plants -- a $90 per ton subsidy in the form of free allowances.)"

Coal's Future Wagered on Carbon Capture [Washington Post]

Who Needs A Pension Plan When You Can Be A Lobbyist?

2009-08-11T08:47:00.000-07:00

If you want examples of what is wrong with California, look no further than an article in today's Los Angeles Times that describes a proposed six figure lobbying contract for former Assembly Speaker Fabian Nunez (the author of AB 32) under which he would advise the LA Department of Water and Power on compliance issues related to...

wait for it...

AB 32.

Yeah, I know this goes on all the time, in every state, in every industry-- and at the federal level the practice has been turned into an art form, but this just seems particularly unseemly.

The good news is that the contract got flagged and questions are being raised, but it could still go through:

"That effort hit a roadblock last week after the five-member panel that oversees the DWP asked its executives to explain the need for a contract worth up to $2.4 million with Conservation Strategy Group, which serves as a lobbyist and bond advisor to the utility. Under the proposed contract, the conservation group would retain Nuñez' firm, Mercury Public Affairs, as a subcontractor at a rate of $120,000 a year."

DWP proposes hiring former Assembly speaker Nuñez to help lobbyists [Los Angeles Times]

The Hydrogen PR Offensive

2009-08-10T09:23:00.000-07:00

It's a familiar story in California: clean-burning alternative energy as a great idea in search of sufficient infrastructure to implement it effectively.

The lastest example is hydrogen.

As a first step to building the much ballyhooed "hydrogen highway" (the five year plan to build hydrogen fueling stations for fuel cell vehicles up and down the state), Shell sought approval from the city Planning Commission in Torrance, CA to build a small, automated fueling station in Torrance. Thought to be a pro-forma step, imagine the company's surprise when they were flatly denied!

Local residents, armed with the kind of misinformation not seen in these parts since the LNG controversy of a couple of years ago (fireballs, mass destruction, end of the human race, etc.) made their voices heard and the Planning Commission did what planning commissions do in those situations.

After regrouping, Team Hydrogen did what it should have done in the first place-- and what it is going to need to do going forward all over the state: it went on a charm offensive and hosted a major community and media event at Toyota Headquarters in Torrance.

The episode provides a lesson that is applicable to the entire range of alternative energy technologies: the urgency of the agenda and the overall public desire to embrace new technologies is not going to be enough; NIMBYism is real and it is going to take lots and lots of outreach all up and down the state before the kinds of alternative energy advances contemplated by proponents and legislation can become reality.

Hydrogen fuel facility proposed in Torrance [Torrance Daily Breeze]

"Curiouser and Curiouser"- A View From Inside The Rabbit Hole at T-Ridge

2009-08-06T09:39:00.000-07:00

The Los Angeles Times absolutely blew up my news aggregator this morning, but two items in particular are worth mentioning...

The first is about the political "gift that keeps on giving"... you guessed, T-Ridge.

It's been a week so we're probably overdue for another bizarre development in the T-Ridge offshore drilling saga. Well the Assembly, which threw the most recent T-Ridge curveball when it torpedoed the Senate plan to approve offshore drilling at the site, did not disappoint.

Patrick McGreevey reports in the Times today that the Assembly has expunged the T-Ridge vote from the official records, essentially making it disappear.

This is rank politics at its worst, even by T-Ridge standards. In a transparent ploy to protect members from defending a "yes" vote on drilling the Speaker simply pulled out the old legislative eraser and made the entire vote disappear.

This would certainly lend credence to the CalBuzz theory we talked about yesterday that recent poll results showing support for offshore drilling are misleading and that the issue is still a huge political liability for anyone trying to get reelected.

Also in the Times is a pretty level-headed commentary from George Skelton who basically says, "Enough!... Drill the oil and tax it. We need the oil and we need the revenue." (I'm paraphrasing but I think that is on point.)

What Do Californians Really Think About Drilling?

2009-08-05T10:29:00.001-07:00

Last week we posted about CalBuzz's report on the PPIC poll that revealed broad statewide support for offshore drilling. CalBuzz has a follow-up to that report today that seeks to invalidate the survey's results by wrapping a gut instinct theory inside a aggressive defense of pollster Mark Baldassare as a stand up guy.

If that last sentence sounds a bit tortured, it is. So is the line of argument in the CalBuzz piece, but I'm not saying it's wrong. Jerry Roberts and Phil Trounstine have been around the block a few thousand times, so underestimate their instinct at your peril.

Net-net, they argue that in the PPIC poll the issue of offshore drilling was put to voters as part of series of energy policy questions that focused heavily on meeting energy needs and reducing our national dependence on foreign oil. In that context, support for drilling is not that surprising.

However, Roberts & Trounstine posit the theory that most Californians consider offshore drilling an environmental issue and-- had the question been posed in an environmental context-- the results likely would have been strikingly different. Bottom line, they argue, if you are a candidate for statewide office, you could still get your head handed to you if come out in support of drilling.

The post is interesting and probably pretty accurate.

Polling on Offshore Drilling: Energy or Environment? [CalBuzz]

San Jose's Green Vision

2009-08-04T08:38:00.000-07:00

USA Today shines the national spotlight on San Jose's efforts to become 100% self-sustaining through a commitment to biogas.

The paper reports:

"The California city is pushing forward with its "Green Vision" of getting all its electrical power from clean, renewable sources, as well as diverting 100% of its waste from landfills and converting it into energy.

In mid-June, the City Council gave the green light to start negotiating plans that could lead to the nation's only organics-to-energy biogas facility.

Renewable biogas, which contains methane, will help power the nation's 10th-largest city, which hopes to reduce its per capita energy use by 50% and get the remaining 50% from renewable sources, says Jennifer Garnett, spokeswoman for San Jose Environmental Services Department."

At the center of the city's efforts is a process called "dry anaerobic fermentation," which allows for the breakdown dry materials that would otherwise hit the landfill. According to the article, "

"The dry process, done in the absence of oxygen, is new to the USA, says Michele Young, organics manager of San Jose's Environmental Services Department.

There are similar operations nationwide, but they involve "wet waste," which is easier to recycle than dry waste, Young says. Dry waste is what usually ends up in landfills.

The proposed new technology is already in use in 12 facilities in Germany and Italy. Thirteen more are planned for this year, Young says."

Is biogas the way to San Jose's energy independence? [USA Today]

Will Waxman Markey Less Dependent on Foreign Oil?

2009-08-03T09:24:00.001-07:00

Kathleen Parker's column in Sunday's Washington Post seeks to bludgeon the notion that Waxman-Markey bill, dubbed the "American Clean Energy and Security Act," makes us more secure.

In fact, Parker argues that the bill makes us, if anything, more dependent on foreign oil: "The more we cap our carbon, the happier the Saudis are."

Parker is not exactly a reactionary conservative on this issue. She describes herself as "a Prius-driving, pro-seal, recycling, organic vegetarian" who is "heavily tilted toward saving the planet."

Her basic thesis is twofold: that the bill only addresses stationary sources, not mobil (i.e., transportation), and that the carbon taxes it envisions under a cap and trade scheme make domestic production way, way too expensive.

It's a compelling argument and worth a read...

A Crude Reality About Energy Independence [Washington Post]

Pitching A FiT Over Renewable Incentives

2009-07-31T09:30:00.000-07:00

The solar energy website Cooler Planet, eviscerated feed-in tariffs on its blog this week. In a brilliant piece of descriptive positioning, the folks at CP refef to FiT's as "German Style Tariffs." That alone should be enough to scare anyone off...

Substantively though, the post explains what FiT's are, and why they are bad...

Given that the PUC is actively considering them as part of the RPS, the post is worth a read.

Feed-in Tariffs, Solar Boon or Boondoggle [Cooler Planet]

Facing an 0-2 Count on Tranquillon Ridge

2009-07-30T09:33:00.000-07:00

Can I take my mulligan now?

Say what you will about offshore drilling, but the political football that is Tranquillon Ridge is starting to become downright entertaining. I don't know how many times we can guess wrong on this project, but it appears that we've done so again!

Last week we posted that, as part of the budget deal hammered out in Sacramento, T-Ridge was a done deal. Take it to the bank. Even the man on the street spoke favorably of it. Then it was voted down in the Assembly in that frantic Friday session. Strike one!

Then, yesterday we noted that PXP put out something of a "sour grapes" press release in which it vowed to press forward with T-Ridge because the Assembly had (I'm paraphrasing here...), to borrow the President's now imfamouse phrase, ACTED STUPIDLY. That post closed with the not-so-presceint rhetorical question, "you have to wonder just how many lives this cat has?"

Well today, CalBuzz reports that a new PPIC poll shows overwhelming public support for the project and its prospects are likely greatly improved. Strike two!

According to CalBuzz:

"A PPIC survey released late Wednesday shows that 55 percent of likely voters support more oil drilling off the coast, compared to 41 percent who oppose it. Among all adults, the gap is narrower — 51-to-43 percent in favor — although this is the second year in a row that PPIC found majority backing for more drilling, which previously was a long-settled issue in the state."

What's next? We're officially out of the T-Ridge prediction business, but CalBuzz includes the following in its write-up:

"The project could return in several venues. Speaker Karen Bass said in a statement after the budget vote that the project “could be reconsidered in August.” Although Bass’s press office failed to return calls seeking clarification about exactly what this meant, it is possible the project could return in a standalone bill. With state revenues continuing to plunge, the project might also be resurrected yet again if the governor and Legislature have to craft another deficit cutting package in the fall or winter.

And as leaders of Santa Barbara’s Environmental Defense Center work to address the problems with the project cited by the State Lands Commission in January – specifically the enforceability of PXP promises to permanently end offshore drilling on four federal platforms in exchange for the state lease – the possibility that Schwarzenegger could name a replacement for Garamendi would be crucial."

Arnold's Offshore Oil Drill Project Not Dead Yet [CalBuzz]

A Tranquillon Ridge Post Mortem: "Not Dead Yet!"

2009-07-29T08:37:00.000-07:00

By now you probably know that the on-again, off-again saga of offshore oil drilling at Tranquillon Ridge off the coast of Santa Barbara is decidedly OFF.

Last Wednesday, we posted that the pending the budget compromise in Sacramento had given the project the green light and that "man on the street" reactions to the deal were mostly positive (as reported in the Los Angeles Times). Well, call us the kiss of death, because 48 hours later, the project got killed again.

Like a cat with 999 lives, though PXP, the Texas company behind the project, is not quitting.

PXP put out a press release on Sunday that basically called out the Assembly for turning its back on a sweetheart deal for the taxpayers and vowed to continue the fight.

Writing in the Ventura County Star, Tim Herdt notes:

"It should be noted that Schwarzenegger didn’t put up a fuss after the Assembly nixed the proposal. In a news conference immediately after passage of the rest of the budget-balancing package, he didn’t mention rejection of the PXP plan.

[Assemblyman Pedro] Nava said he believes that Schwarzenegger’s enthusiasm for the plan may have wilted last week in the face of such strong opposition from environmental groups. One of their messages to the governor, who prides himself on his strong stance on fighting global warming, is that the oil deal would have ruined his environmental legacy.

The message, Nava said, was that if the deal went through, Schwarzenegger’s record on environmental issues would forever be summed up in a single sentence: “Allowed the first offshore drilling in California in 40 years.”

While PXP says that it is "committed to continue working with California's elected and appointed leaders on a potential agreement for the T-Ridge project," and that it " intends to continue pushing for the project based on its merits to the state of California and address any misconceptions that groups may have regarding the project," you have to wonder just how many lives this cat has?

California Gets Green Energy Accolades from EPA

2009-07-28T09:16:00.000-07:00

The EPA yesterday recognized 20 green energy "partners" for generating the most renewable energy "0n site." These partners included private companies and government organizations, and 8 of the 20 were in California.

The list is as follows:

· Los Angeles County Sanitation Districts, Whittier, CA – 54% green power
· City of San Diego, CA – 27% green power
· San Jose/Santa Clara Water Pollution Control Plant – 56% green power
· City of San Francisco, CA – Percentage of Green Power 3% green power
· Wal-Mart Stores, Inc. / California and Texas Facilities –8% green power
· Macy's Inc. / California and Hawaii Stores – 3% green power
· Safeway Inc., Pleasanton, CA – 3% green power
· Alameda County, CA / GSA Facilities – 11% green power

Here is how the EPA defines its own terms/criteria for selection:

"Green power is generated from renewable resources such as solar, wind, geothermal, biomass, biogas, and low-impact hydropower. On-site green power is deployed directly at energy users' facilities rather than at central power plants. Green power electricity generates less pollution than conventional power and produces no net increase in greenhouse gas emissions."

The release includes more detailed write-ups on each of the named "partners."

U.S. EPA Names Top California Organizations Running on Their Own Green Power [EPA Press Release]

Climate(Not So)Smart.

2009-07-27T09:27:00.000-07:00

About a year and a half ago we posted an update on PG&E's voluntary "ClimateSmart" program and the results at the time were not so stellar. Only 17,500 people had signed up for the voluntary program to pay a little extra on their montly utility bill to fund green projects designed to offset carbon dioxide production.

Well how has the program done these last 18 months? Not so good.

The San Francisco Chronicle reports that, to date, only 31,000 customres have signed up to pay the roughly $3 a month into the program. That's a little short of PG&E's projects-- like, 5.1 million people short!

In dollar terms, PG&E has spent $9.7 million on the project and gotten $2.6 million in return.

Guess who is funding the difference?

For anyone who said, "the state of California," we completely understand why you would think Sacramento would find itself on the hook for such a boondoggle, but we're sorry to disappoint. Yup, the answer is all of the ratepayers-- whether they are part of the program or not.

While ClimateSmart makes no economic sense whatsoever, let's give credit where credit is due and at least highlight the four projects it is actually funding (as reported in the Chronicle):

So far, PG&E's ClimateSmart program has funded four projects that capture greenhouse gases:

- The Big River and Salmon Creek Forest: Conservation Fund. Sustainably manages 16,000 acres of redwood and Douglas fir trees on the Mendocino Coast, allowing the trees to grow larger and draw more carbon dioxide from the atmosphere.

- Garcia River Forest: Conservation Fund. Manages 23,780 acres of forest in Mendocino County.

- The Lompico Headwaters Forest: Run by the Sempervirens Fund. Protects 425 acres of forest in the Santa Cruz Mountains from logging.

- California Bioenergy project: Uses methane from decomposing cow manure on a dairy near Bakersfield.

PG&E pushes to extend unpopular ClimateSmart [San Francisco Chronicle]

Smart Grid Is Back In the News

2009-07-24T09:33:00.000-07:00

Lost recently amid all of the other potential roadblocks to meeting the lofty renewable goals set by California and the President, is an old, familiar problem that hasn't gotten a lot of attention recently-- the aging, decrepit grid can't handle that kind of load. A new SmartGrid is required.

In testimony before Congress yesterday, SCE's Vice President for Advanced Technology, Paul De Martini, rather bluntly reminded legislators that the renewable energy goals being bandied about are well and good, but until we invest big time in the grid, it's a moot point.

According to Reuters:

"The Obama administration has called for doubling the amount of U.S. electricity produced by renewable sources, such as wind and solar power, during the next three years to reduce greenhouse emissions that cause global warming.

However, a so-called "smart" grid will be needed to transmit those power supplies from where they are generated in remote areas to consumers and businesses in cities.

"The electricity infrastructure delivering power from a variety of generating sources to our homes, businesses and communities is not suitable for today's needs," said Paul De Martini, SCE's vice president for advanced technology.

"The challenges that face our nation's energy future simply cannot be met by our aging electric grid," Martini said at a House Science subcommittee hearing on how to update the grid."

U.S. electric grid needs major overhaul: utility [Reuters]

Jackpot!

2009-07-23T10:13:00.000-07:00

Who needs ANWR or offshore oil rigs? Occidental has announced the biggest oil and gas find in California in the last 35 years-- in Kern County!

The field contains as much as 250 million barrels of oil and, according to the Los Angeles Times, "two-thirds of the new source was believed to be natural gas."

Oxy owns 80% of the field; Chevron has the other 20%.

The obvious question is how such a big deposit could go unnoticed for so long? The company chalks up the find to new exploration technology which might cause one to wonder if domestic oil exploration might not see a renaissance now that new technology has hit upon such a significant score...

In a separate report, the Times notes that, "Occidental's second-quarter results were a big improvement over the first quarter, with net profits rising more than 85% from $368 million, or 45 cents a share."

Oxy Petroleum's oil and gas discovery may be California's largest in 35 years [Los Angeles Times]

Man on the Street Take on Tranquillon Ridge

2009-07-22T08:46:00.000-07:00

The new budget deal gives the go-ahead to offshore oil drilling at Tranquillon Ridge off Santa Barbara. The on-again, off-again project has been something of a soap opera, with no shortage of innovative horse-trading, political intrigue and hardball politics.

Today's Los Angeles Times reports on community reactions from Santa Barbara to the latest news that the drilling will proceed. Now, given that it's the L.A. Times and that it's Santa Barbara, you would expect scathing reviews... but the report is surprising.

The project's long-time opponents stayed on message, but the average, everyday citizens interviewed for the piece offered unexpected report.

While one guy asked rhetorically, "Why take the chance?" (alluding to a potential spill), the other comments were mostly positive.

Here is a sampling:

"Coach Mike Maas, 57, couldn't disagree more about the so-called Tranquillon Ridge proposal. The people who complain about drilling off of Santa Barbara "are the same ones driving around in their big Escalades," he said as his team cavorted. "The economy sucks. If that is a way to get some money, why not?""

"But Reynolds Yater, who was dropping off one of his eponymous surfboards at The Beach House nearby, said Americans can't complain about oil drilling and then buy surfboards and wetsuits.Waving his arm at the store's wares, Yater pointed out that "all of this stuff is made out of oil, so it's very hypocritical to be making this stuff and then not want it drilled on our beaches."

Another person interviewed expressed concern over a spill, but his apprehension was rooted not in fear of ecological damage, but in what it would mean to Santa Barbara economically:

At Santa Barbara Trolley Tours, driver Craig Boslaugh, 60, worried that another spill like 1969 "would affect tourism, so it would definitely affect our business."

Is this just a case of selective reporting or do economic recessions trump environmental politics?

Budget deal's oil-drilling component draws mixed reviews [Los Angeles Times]

PG&E Seeking Rate Increase

2009-07-21T08:40:00.000-07:00

PG&E formally notified the PUC yesterday that it will seek a whopping 6.4% rate increase this December. The increase would kick in 2011 if it is approve by the commission, which likely will vote on it in late 2010.

The rate increase would fund upkeep and maintenance of the PG&E's system infrastructure, which currently costs about $2.2 billion a year ($2.7 billion with the propsed rate increase).

But this is just the tip of the ice berg.

Additional rate increases would follow--1.4% in 2012 and 1.8% in 2013.

Writing in the San Francisco Chronicle, David Baker notes:

"Some categories of customers would see a larger increase than others. But starting in January 2011, a typical homeowner's monthly electricity bill would rise $2.20 to reach $76.27. People with larger houses that use more power would pay $16.80 more per month than they do today, for a total of $180.48. Meanwhile, monthly natural gas bills for all homes would rise by an average of $3.30."

Baker also quotes TURN which sums up the situation rather succinctly:

"Every time, they talk about reliability, and it doesn't get better," said Matt Freedman, staff attorney with The Utility Reform Network, a consumer watchdog group. "Will the commission reward them, again, for poor performance? It's like the most perverse incentive on earth."

PG&E, citing infrastructure, seeks rate hikes [San Francisco Chronicle]

Waste Not, Want Not...

2009-07-20T10:09:00.001-07:00

The Pacific Coast Business Times profiles a rather unusual-- but potentially effective and very lucrative-- energy venture in Oxnard.

Gills Onions is the largest onion processor in the country. It processes about a million pounds of onions a day and employs 400 people. The company, which used to compost its "onion waste" in a field, is now turning it into energy.

We've read about all sorts of odd biofuel ventures, so the company's project in and of itself is not that interesting. However, the environmental and economic statistics rattled off by the Times, are head turners.

The old practice of composting the onion waste certainly sounds environmentally friendly, however, decaying onions creates greenhouse gas emissions and requires lots of diesel truck trips to and from the field. Factor in tipping fees and field labor and, all of a sudden, this doesn't sound like such a a great option.

The onion-to-energy process generates 600 kw of power and makes the company eligible for a pretty sizable payout from the state. The Times reports that Gills is in line to get $2.7 million from a state program that promotes programs such as this. All in, the company spent more than $9 million on the techology, but it estimates that it can pay for itself in six years.

Net-net, the Times reports that, "Turning the waste into energy instead will save the company $700,000 in electricity costs, $400,000 in land-application costs and reduce its greenhouse gas emissions by up to 30,000 tons annually."

Energy, layer by layer — Gills Onions launches fuel cell facility [Pacific Coast Business Times]

The Politics of Offshore Drilling

2009-07-17T08:51:00.000-07:00

Fresh off of his national "to drill or not to drill" tour, Interior Secretary Ken Salazar has announced that the Administration will proceed with plans to auction off oil drilling leases in the Gulf of Mexico.

From an energy perspective, that's good or that's bad depening on who you talk to. But form a political perspective, it's fascinating.

Consider this.

The original plan to drill the Gulf (and Alaska) was owned politiclally-- lock, stock and barrel-- by former President George W. Bush and it enjoyed broad support by conservatives.

New President Barack Obama-- arguably the most liberal president since FDR and the political antithesis of Bush-- is swept into office promising to undo everything Bush put into action. (Except the stimulus... but I digress.)

A federal appeals court in Washington essentially does the dirty work on the Bush offshore oil leases for the new president, invalidating them for insufficient environmental impact analysis on the Alaska portion of the plan.

Rather than check off "terminate the Bush offshor oil plan" from his Presidential to-do list, Obama sends out Interior Secretary on a national listening tour to guage public sentiment for drilling.

Now comes the announcement that Obama is going ahead with the plan-- in the Gulf, at least, which was the part of the plan the court ostenisbly did not object to. The Interior Department has no plans to appeal the court ruling, which is a de facto acceptance of the plan's illegitimacy, but it is asking for "guidance" from the court. All of this notwithstanding, the lease auctions are going ahead as planned.

You would think conservatives would be thrilled, right? Well, the Republicans, for their part, criticized Obama for not going far enough, with one lawmaker stating that to only drill in the Gulf puts "all of our eggs in one basket."

All of this has been put into play by a President who has made curbing the the use of fossile fuels and promoting renewable energy production and development the centerpiece (along with health care reform) of his legilsative agenda.

Around and around we go...

Offshore oil leases to be auctioned despite legal uncertainty [Los Angeles Times]

A "Government Solution" To Climate Change Still on the Table in California

2009-07-16T08:41:00.000-07:00

If you want to be a player in Sacramento, inserting yourself prominently in the energy agenda is a prudent place to start. Nobody has ever accused Sen. Alex Padilla of not being "prudent" (or insert your own synonym here).

So nobody should be surprised by the longish piece in Capitol Weekly today about Padilla's efforts to take up where Don Perata left off on pushing for a massive new state agency/research institute to study potential solutions to climate change.

Perata's bill to establish the $50 million a year insitute was killed for a variety reasons-- not the least of which was Perata himself and the implications it had for his stature in the capitol-- but he's gone now and Padilla has stepped up with a what the Weekly calls a "placeholder bill," hoping to revive negotiations over the propsoed institute next year when the economy improves.

The Weekly reports:

"Padilla’s bill takes a slightly different tact, but it is sure to go through a number of revisions if and when it is resurrected next year. As of now, the bill is still mostly a placeholder. It does not specify a governance structure for the Institute, the size or scope of the research to be undertaken by the Institute, or the funding source for the Institute’s operating costs or research,” according to a Senate analysis of the bill.

Padilla says the idea of the institute would be to leverage federal stimulus dollars, and coordinate efforts to meet new state greenhouse gas requirements set forth in AB 32, the greenhouse gas reduction bill authored by now Sen. Fran Pavley, D-Agoura Hills."

-and-

"In addition to the ratepayers’ fee, the California Climate Change Institute would have been financed with about $12 million worth - about half - of the natural gas fees that currently go to an Energy Commission research program known as PIER. The institute’s total budget would have been about $500 million dollars over the next decade. The intention was to woo federal matching money, too - a likely prospect because of the federal government’s infusion of cash into carbon emission research. Since the goal of the institute, which was written into the legislation, was to get matching money for 100 percent of its income, the CCC1 would have had authority over $1 billion. "

All of this begs the question of whether we really need a $50 million a year state entity to combat the problem of global warming. After all, nothing says "innovation" "groundbreaking" like a California state agency.

Legislature still working toward greenhouse gas institute [Capitol Weekly]

On The Road Again... Just Can't Wait To Get On The Road Again....

2009-07-15T09:25:00.000-07:00

Traveling today so not much time to sift through the news...

But for your entertainment, check out Sen. John Kerry's response to Sarah Palin's cap and trade rant... he published it yesterday in the friendly confines of the Huffington Post.

This is like some cyber-consolaton-game between a "could have been President" and a "wow that was weird, Vice Presidential nominee"... I suspect more than a few people would prefer they just exchange email addresses and have this debate off line!!!!

What Gov. Palin Forgot [Huffington Post]

More on Climate Change and Cap & Trade

2009-07-14T07:45:00.001-07:00

The opinion section of today's Washington Post is a treasure trove of energy observation.

First, columnist Anne Applebaum takes on the notion that world leaders can do anything at all about climate change. Applebaum argues that the only thing that is going to fix the problem is money-- not treaties, speeches or conferences.

Now, when she says "money," she doesn't mean it in the way President Obama would typically interpret it, i.e., "Let's print more tax dollars and subsidize companies in the green energy sector...and while we're at it, maybe create an extra government agency or two to perform (poorly) redundant regulatory tasks."

Applebaum argues that the only way to fix the climate change problem is for some entrepreneur to get obsceneley wealthy running a company that actually performs in the renewable energy sector (Memo to T. Boone Pickens...).

She states:

"The truth is that carbon emissions will not be reduced by international bureaucrats, however well-meaning, sitting in a room and signing a piece of paper. They will not be reduced by public relations campaigns or by Oscar-winning documentaries. Above all, they will not be reduced by a complex treaty that neither the United Nations nor anyone else can possibly supervise, particularly not a treaty that effectively punishes those countries that abide by it and ignores everyone else. They can, however, be reduced by the efforts of entrepreneurs such as Pickens. If he and others can find economically viable ways to produce clean energy, then the problem will solve itself without the aid of a single international conference. To put it another way: The first solar power billionaire will have many, many imitators. "

Chew on that.

But the real star of the opinion pages is the "gift that keeps on giving"... Governor Sarah Palin of Alaska, who comes out firing against cap & trade:

"American prosperity has always been driven by the steady supply of abundant, affordable energy. Particularly in Alaska, we understand the inherent link between energy and prosperity, energy and opportunity, and energy and security. Consequently, many of us in this huge, energy-rich state recognize that the president's cap-and-trade energy tax would adversely affect every aspect of the U.S. economy.

There is no denying that as the world becomes more industrialized, we need to reform our energy policy and become less dependent on foreign energy sources. But the answer doesn't lie in making energy scarcer and more expensive! Those who understand the issue know we can meet our energy needs and environmental challenges without destroying America's economy.

Job losses are so certain under this new cap-and-tax plan that it includes a provision accommodating newly unemployed workers from the resulting dried-up energy sector, to the tune of $4.2 billion over eight years. So much for creating jobs.

In addition to immediately increasing unemployment in the energy sector, even more American jobs will be threatened by the rising cost of doing business under the cap-and-tax plan. For example, the cost of farming will certainly increase, driving down farm incomes while driving up grocery prices. The costs of manufacturing, warehousing and transportation will also increase.

The ironic beauty in this plan? Soon, even the most ardent liberal will understand supply-side economics."

You betcha!

But alas, the chattering classes- as they are wont to do-- have already pounced on her, saying she has no idea what she's talking about.

The Summit of Green Futility [Washington Post]

The 'Cap And Tax' Dead End [Washington Post]

Do-It-Yourself Geothermal

2009-07-13T10:15:00.000-07:00

Until now, the little town of Anderson Springs in Lake County was known as a place to hike and for its seismic activity. Soon it could be known as town that revolutionized the way we harness geothermal energy.

A start up company called AltaRock is testing a way to essentially create geothermal energy.

Traditionally, geothermal power has come from tapping existing pockets of steam beneath the earth's crust; steam that is then used to power turbines and create electricity.

Like any form of alternative enregy, be it solar, wind, etc., the challenge with geothermal has been that, in order to harness it, you have to go where the steam pockets are. That may no longer be the case.

AltaRock is testing a new method whereby they drill down to superheated rock (in the case of Anderson Springs, a drill boring of 2 miles) and then inject water into shaft, creating steam off the superheted rock below.

If it works, the upside is limitless.

However, as we have seen with other forms of renewable energy, the project is not without its detractors.

Solar arrays have been opposed by conservationists who fear damage to desert ecosystems; wind turbines have been opposed by animal rights advocates who fear bird strikes (and by Kennedys who like their ocean views).

Now the residents of Anderson Springs are speaking out against the AltaRock project, fearing that it will exacerbate an already dicey seismic situation, and cause earth quakes.

It's an interesting experiment to watch play out.

Small town fears quakes from geothermal energy project [Sacramento Bee]

Are Conservationists Winning the Solar Battle?

2009-07-10T09:08:00.000-07:00

Reuters moved a story yesterday that posited the theory that the future of solar power in California lies in "distributed generation."

Translated: big solar farms out in the desert cause too many political problems, don't create enough jobs, are expensive, etc., etc., so the future of solar lies in individual, small rooftop arrays.

From Reuters:

"Trend-setting California may be the test case for the United States. It has the most aggressive renewable ambitions of any state in terms of raw energy production. A target of 20 percent renewables may be raised to a 2020 goal of 33 percent.

"We really may be in a paradigm shift," said Judith Ikle, program manager for procurement of renewables and climate mitigation at the state's Public Utilities Commission, which has just finished an analysis of how to build a state-wide system that gets a third of its power from renewable sources.

California expects most of its new renewable power to come from big solar thermal desert plants, which use mirrors to focus the sun's heat and drive a generator.

But the PUC also considered a "distributed generation" model of putting solar panels on rooftops all over the state, commenting that political roadblocks for transmission and big plants could make it more attractive and that it could be a cost-competitive solution if solar panels, now one of the most expensive renewables, continue a price dive."

A PUC analyst quoted in the piece comments that distributed generation is great in theory, but price and grid integration issues remain.

Politics may make future of solar energy "small" [Reuters]

Jobs vs. The Environment - Just Another Day in California

2009-07-09T09:26:00.000-07:00

Playing the "jobs" card has been a standard tactic for real estate developers for years. Recently, President Obama has used it to sell his energy agenda. Now, against a backdrop of 11.5% unemployment in California, Chevron is screaming "JOBS!!!"

After getting hit with a negative ruling on its EIR for the Richmond refinery upgrade, Chevron was ordered to halt construction on the project. The judge says the EIR was inadequate; Chevron disagrees and is appealing.

At issue are two massive furnaces designed to create hydrogen needed to refine "sour crude." But environmentalists say the furnaces are trojan horses that are capable of processing the ultra-dirty "heavy" crude and that is Chevron's true agenda.

Caught in the middle of the he-said, she-said are more than 1,000 workers construction workers and electricians who have been laid off.

In the San Francisco Chronicle, one environmental activist who is driving the fight against the expansion made the comment that Chevron is flush with cash and shouldn't lay off the workers. (He doesn't address what 1,000 construction workers and electrricians would actually do with the project shut down.)

Look for more grandstanding and demagoguery on this issue as the appeals play out.

Chevron to appeal ruling on Richmond refinery [San Francisco Chronicle]

Transmission Project Could Be History

2009-07-08T08:32:00.000-07:00

You know that proposed 600 mile transmission line project that is supposed to deliver green energy from the Shasta County in the northeastern part of the state down to the bay area (Santa Clara, to be exact)? As Tony Soprano would say, "Fuggedaboudit."

SMUD, which was the biggest investor, with a 35% stake in the project, just pulled out. Citing a litany of reasons for pulling the plug, from regulatory and economic uncertanities to renewed skepticism about the overall wisdom of the project, the agency's departure from the project makes completion really, really unlikely.

The Contra Costa Times reports:

"The public works project in question — one of the West's largest in recent history — would extend from yet-to-be-developed wind and solar farms in the northeastern part of the state. It would wind through parts of the Central Valley and Bay Area, including protected agricultural and viticultural tracts in the Livermore Valley, to furnish power-thirsty urban areas with energy.

The project's sponsor, the Transmission Agency of Northern California, is a group of 15 or so municipal power providers that banded in the 1980s to develop green power. Only five of those members — the Sacramento Municipal Utility, Modesto and Turlock irrigation districts, and the cities of Redding and Santa Clara — had agreed to fund the initial environmental work and, if it is ultimately approved, to finance the project.

SMUD, the largest stakeholder by far, had been expected to shoulder 35 percent of the project's costs. The utility's withdrawal leaves a gaping hole in the project budget and raises questions about its future."

Future of controversial Northern California power line project in doubt [Contra Costa Times]

Into the Sausage Grinder...

2009-07-07T08:49:00.000-07:00

Paul Kane's article in the Washington Post describes what he calls a "daunting march through the Senate" this week for climate change legislation approved in the House that features, as its centerpiece, Cap & Trade.

The bill appears to be about 15 votes short of the supermajority 60 it needs to pass, so get ready for some horse trading that could make the legislation unrecognizable by the time it exits the chamber.

Kane notes:

"Senators will weigh a slew of potential compromises -- everything from allowing more offshore drilling for oil and natural gas to increasing funding for nuclear energy -- that they think would inch the package closer to passage. But environmental activists warn that the 1,400-page House version of the bill already includes so many giveaways to corporate America that more horse-trading in the Senate could lead them to oppose the final version."

What makes this debate so unusual is that the usual party loyalties do not apply-- it's all about geography. Some liberal senators who would seem like natural supporters of the bill are holding

out for sweetheart deals for corporate interests in their home states.

For example, the Post article points out:

"Democrats from the Rust Belt states of West Virginia, Ohio, Indiana and Michigan are pushing for more incentives to help their depressed industries shift to alternative energy sources. The same senators also will likely want more funding for carbon capture and sequestration, a controversial and still-evolving technology described by its developers as "clean coal" but derided by many environmentalists. The technology is already slated for $10 billion in government-funded research in legislation that passed the House. A trio of Democrats from the Dakotas want more funding for wind power. "

Given that this bill barely passed the House, it's anybody's guess what it will look like this time next week.

Push and Pull in Senate May Recast Climate Bill [Washington Post]

The Future of Net Metering

2009-07-06T08:19:00.001-07:00

Solar power might not receive subsidies of "ethanol proportions," but it certainly does get its share of government largesse. One perk, however, might be set to expire: net metering.

Individuals who install solar panels get to sell excess power back to utilities at retail rates. This credit often wipes out nearly or entirely a monthly utility bill. It's a great deal for solar users, but, detractors argue, not so much for other utility customers.

The argument against net-metering is that it unfairly shifts costs from solar users onto non-solar users because the utilities are using ratepayer money to compensate the solar users, and they are doing at the retail power rate, not the actual cost of solar power which is much, much lower.

The net result is that solar customers end up paying little or nothing and non-solar customers end up paying not only for power, but for all of the other costs buried in their monthly bill, like infrastructure costs and regulatory fees.

The Los Angeles Times reports today that the net metering program has almost reached its legislated limit and could expire unless the program is expanded: "utilities are limited by state law from buying from its customers more than 2.5% of a utility's maximum generating capacity" and "the state's $3.3-billion solar subsidy program has become so popular that the state utilities are approaching the legal limit for how much power they can buy from customers."

Assembly Member Nancy Skinner has introduced AB 560 that seeks to increase the cap on net metering fourfold. All of the major utilities oppose the measure, citing cost shifting issues and basic consumer fairness.

In addition to net metering, solar users also enjoy state and federal tax credits.

California solar-power subsidy program approaches its limit [Los Angles Times]

East Coast Bias Continues-- Dissing California!

2009-07-02T08:10:00.000-07:00

On Monday, President Obama held up California as the model for the nation's energy future.

Yesterday, a newspaper in the President's back yard-- the Washington Examiner-- penned a blistering editorial that called out California as an unmitigated disaster of energy policy.

The Examiner states:

"Obama might want to rethink his choice of a model state because it is easy to understand how California has curbed its energy use. Between 2000 and 2007, before the current recession, the state shed nearly 21 percent of its manufacturing jobs, driving down its industrial electrical consumption by 21 percent. California's industrial users pay electric rates twice as high as their Midwestern counterparts - which helps explain why so much heavy industry has fled the state. In addition to alienating its industry, California has also curbed energy use through exorbitant residential electric rates (50 percent higher than the national average) and massive net out-migration. Between 2005 and 2007, 2.14 million Californians moved to other states, while only 1.44 million people from elsewhere moved to the Golden State, according to the U.S. Census Bureau. Don't be surprised when the 2010 Census finds even more people leaving to escape California's 11.5 percent unemployment. And, as jobs and residents fled California, its tax revenues have declined, while its politicians went on a spending binge, creating a severe budget crisis."

That's a mouthful.

California, Here We Come [Washington Examiner]

Republicans Stepping Out of Character to Support Cap & Trade

2009-07-01T08:02:00.001-07:00

First Scott McLellan, now Mike Gerson??

In a "man bites dog" story, Michael Gerson, who was George W. Bush's most trusted speechwriter, hails the courage of the eight Republicans who voted for cap and trade last week.

Gerson points out that "the eight Republicans who supported it were bound to feel some rapid political warming. Conservative Internet and radio accused them of single-handedly passing President Obama's "cap-and-tax" legislation..."

But, he calls this a "myth," noting that Speaker Pelosi would have marshalled the necessary votes come hell or high water and this was a fait accompli in the House. More importantly, Gerson argues that, as patently bad as the bill was (is)-- he describes it as "a riot of loopholes, concessions and offsets -- legislative sausage-making with an excess of offal"-- it likely was the best of our bad options.

An overnight switch to carbon-free energy production isn't going to happen. A straight carbon tax would disproportionately punish American industries already under intense pressure to compete internationally (think cement, steel, paper). So cap and trade is a stop-gap, transitional solution, albeit a flawed one.

Gerson argues that our solution to the carbon problem is technological and that in order to spur innovation, we need to pile on still more incentives. In his words, "putting a price on carbon would make the development of cleaner energy technologies more profitable."

All of this from W's guy...

Cap and Traitors [Washington Post]

p.s., We got our waiver yesterday-- but you probably knew that already.

Government Commits Public Lands for Solar

2009-06-30T09:03:00.000-07:00

Interior Secretary Ken Salazar signed an order yesterday 1,000 square miles of Western land for solar energy development. More than half of the acreage is in California.

The Los Angeles Times reports:

"The proposed California solar-generating areas are projected to have the annual capacity to produce 39,000 to 70,000 megawatts of electricity at full development -- enough to serve millions of homes. There are three large solar projects undergoing environmental review in the state."

Salazar wants to thirteen solar projects underway by 2010.

So far, the reaction from conservationists has been measured, but you can bet that development on this scale on public lands will not be without its entanglements. Stay tuned.

U.S. works to speed solar energy development in the West [Los Angeles Times]

Strange Bedfellows

2009-06-29T14:57:00.000-07:00

Newsflash: Valero is embracing wind energy. Sort of.

Valero has installed a wind farm adjacent to one of its Texas facilities. At peak production, the farm will generate 50 MW, enough to power the adjacent facility nearly half of the time.

According to a report:

"The company hopes to lock in fluctuating electricity prices by developing its own source of power, rather than relying on the grid, and to cut the $1.4-million-a-month electricity bill at the seven-decade-old refinery. The $115 million wind farm, which will be ready to operate at full capacity in August, will pay for itself in about 10 years at current electricity prices, company officials said."

It's a win-win for Valero because, not only will the wind farm lower its electric bill, it will generate plenty of REC's for Valero to sell on the open market.

Despite all of the talk out of Washington about the number of jobs green energy will create across the country, it is interesting to note that, in this particula case, the wind farm creates a grand total of 3 new jobs (the number of people required to operate it once it is up and running)-- compared to 1,500 jobs required to run the adjacent facility.

Using renewable energy to power fossile fuel production may not be exactly what green energy advocates had in mind, but it certainly appears to make sense.

Valero Harnesses Wind Energy to Fuel Its Oil-Refining Process [Wall Street Journal]

To Tax or Not to Tax?

2009-06-29T08:46:00.000-07:00

Last night Assembly Democrats passed a budget package that includes an almost 10% tax on oil production. The move is not unprecedented as Arkansas did something similary last year and Pennsylvania has a similar tax proposal this year. But legislators in Louisana are moving in the opposite direction, cutting taxes on oil and gas production in an attempt to attract more drilling.

The Wall Street Journal quotes WSPA's Joe Sparano who is (obviously) openly critical of the California proposal: "California is a very difficult state to do business in to start with," said "Anything that adds to that burden logically is going to have a negative impact on economic growth."

Advocates of the tax argue that tax planning plays little or no role in a commpany's decision to drill or not to drill in a state-- it's all about how much oil and gas is in the ground. To wit, a Montana think tank produced a report that used a control group of Montana and Wyoming, which concluded that, despite the two states' radically different tax structures, oil and gas activity was more or less the same.

States Consider Gas and Oil Levies [Wall Street Journal]

Jackpot!

2009-06-25T14:15:00.000-07:00

Energy Secretary Steven Chu opened his checkbook today, in a big way, doling out $154 million in stimulus cash to support energy efficiency and renewable energy projects in New Hampshire, Missouri, North Carolina, and right here in California. In fact, California took in the lion's shae of that money--more than $90 million.

According to the write-up in eGov Monitor:

"California will leverage its program funding to provide a statewide energy efficiency retrofit program and cost effective clean energy systems for residential, commercial, and industrial buildings and facilities. The revenue savings that result from these efficiency measures will provide an ongoing source of revenue to continue implementing additional cost-effective efficiency measures. Additionally, California plans to develop and implement a public education, marketing, and outreach effort to ensure the benefits and value of energy efficiency are well understood.

Also as part of California’s State Energy Program, the California Energy Commission (Energy Commission) is investing $15 million through June 30, 2012, in building a workforce to meet alternative fuel and advanced vehicle technology needs through its Green Jobs Training Program. The Energy Commission will expand on this plan and will leverage existing partnerships with $20 million in Recovery Act funding to create a more extensive green workforce focused on energy efficiency and clean energy sources, including wind and solar energy.

After demonstrating successful implementation of its plan, the state will receive more than $113 million in additional funding, for a total of $226 million for the entire program."

No word yet on whether legislators in Sacramento have come up with a way to count this cash infusion as "revenue" for budget purposes...

Obama Administration Awards More than $154 Million for State Energy Programs in Four States [eGov Monitor]

Back In the Saddle Again...

2009-06-24T14:34:00.000-07:00

Well, that was sure fun.

Let me just say that, it's easy to talk about public policy in the abstract, but you get a whole new appreciation for its implications when you're forced to experience personally the issue being regulated.

Fresh from what was supposed to be a two day brush with the health care delivery system (that turned into a week), I have a whole new respect for the incredible standard of care we have in this country. Heaven help us if we actually adopt a Canadian style goverment health care delivery system. But I digress... this is about energy policy not health care.

Bloomberg moved a story today about a Pew Center for Climate Change study that hung a 20% number on the cost of wind energy-- as in, it will cost 20% more than natural gas generated energy.

According the article:

"Harnessing and delivering enough wind power to make it a significant source of energy in the U.S. may raise its cost by 20 percent, according to the Pew Center for Climate Change.

Building transmission lines would cost as much as $4 billion a year, and managing its variability would add further to its price, the Pew Center said in a report today. Prices would still be competitive with other energy sources if the U.S. approves legislation to limit greenhouse gases, the group said."

But economics be damned, there is a political imperative driving our national appetite for wind energy that will level the playing field between wind and fossil fuels. It won't make wind any cheaper, it will just make other energy more expensive. (Can you say "lose-lose"?)

If you slap carbon capture and storage requirements on traditional energy sources like coal or nuclear, wind-- as expensive as it is--actually is cheaper. In government economics, this actually makes sense.

It's good to be back.

Wind energy infrastructure would raise price 20%, study says [Bloomberg, via Los Angeles Times]

In The Shop For Repairs...

2009-06-17T21:11:00.000-07:00

No posts for a day or two... minor hospital procedure, but wifi challenged! Talk amongst yourselves!!!

Still More on Green Energy Job Creation...

2009-06-16T09:27:00.000-07:00

While not quite as grandiose as the predictions the President likes to make, a new study by the non-profit Blue Green Alliance claims that a renewable energy standard will generate 850,000 new jobs:

"According to studies performed over the past seven years, by organizations California Energy Commission and the Berkeley Center for Renewable Energy, renewable sources generate greater employment, four to six times as many (per megawatt), when compared to equivalent investments in fossil fuels. The report postulates that a 25-percent requirement of 18,500 MWs of power from wind, solar, geothermal and biomass by 2025 would create jobs for a group that are the "backbone of the middle class," according to David Foster, the Blue Green Alliance's Executive Director."

You can download the report and draw your own conclusions...

Renewable Power Requirement Could Jump Start Manufacturing [Reuters]

A Bleak Outlook for Coal

2009-06-15T09:14:00.000-07:00

A piece in the Wall Street Journal looks at the effect of plunging natural gas prices on the already cloudy future for coal.

With the price of natural gas less than half of what it was a year ago ($4 per million BTUS, compared to $13 per million BTUS last July) coal's share of the domestic electricity generation market is likely to free-fall (coal accounts for roughly 50% of domestic power generation; natural gas 21%).

According to the Journal:

"New natural-gas discoveries, however, in Texas, Louisiana, Pennsylvania and elsewhere, have created a gas glut that analysts expect to linger. Energy consulting firm Wood Mackenzie predicts gas prices won't recover until 2015.

Power companies are beginning to ratchet back investments in coal-generated plants to take advantage of low gas prices and hedge against costly climate-change legislation."

The write-up includes this rather dim forecast from the coal industry:

""There basically is no spot market for coal right now," adds Jim Thompson, managing editor of the Coal and Energy Price Report in Knoxville, Tenn., a coal-industry newsletter. "Coal companies are living off their utility contracts."

Utilities mostly obtain coal through multiyear contracts. As a result, even though spot coal prices have fallen, prices paid by utilities are expected to rise 2% this year to an average of $2.11 per million BTUs. Next year, the EIA expects coal prices to dip slightly to an average of $1.91 per million BTUs."

Lower Natural-Gas Price Leaves Coal Out in Cold [Wall Street Journal]

Going Obama One Better

2009-06-12T13:16:00.001-07:00

You've all heard the president's claims about job creation from alternative energy. It started out as 3 million new jobs "created" by a national commitment to alternative to energy, but when he started to get questions about the methodology behind that statement, he retreated a bit and changed his stump speech to jobs "saved or created."

Either way it's virtually impossible to prove or disprove, which is why it is such a political winner.

Well the University of California has no use for such equivocation. David Roland-Holst, a UC Berkeley economics professor, has authored a study that finds that "moving half of California's electric power needs to renewable energy sources such as wind, solar or biomass would help create half-a-million jobs over the next 40 years." Boom. Take it to the bank.

In fact, Roland-Holst sees this as the silver bullet solution to all of California's budget problems, which should be music to our green-energy-enthusiast-Governor.

Specifically, the study's assumptions are:

"using clean sources for half the state's electric power while increasing efficiency by 1.5 percent each year would create 500,000 new jobs with a $100 billion payroll."

$100 billion translates into some serious tax revenue... maybe he's on to something. Who's to say? Well, how about Dave O'Reilly and Carl Pope.

They argued it out this week in San Francisco-- guess where each one stood on the issue?

It's all in the Mercury News's write up... enjoy:

Study: Clean energy will stimulate Calif. economy [San Jose Mercury News]

A New Front In the Cap & Trade War

2009-06-11T08:55:00.000-07:00

Opponents of cap and trade have played just about every card in the deck in an effort to repel the proposed carbon emissions trading scheme, with arguments running the gamut from environmental (it doesn't stop carbon emissions, it sanctions them with the purchase of an offset) to economic (this is a simply a tax on business that will drive up costs to consumers).

Still, the proposal barrels on.

Enter a new stakeholder: the tired, poor, huddled masses yearning to be free.

A consortium of environmental justice groups have filed suit in San Francisco Superior Court against the Air Resources Board. The suit alleges that the Board has not done enough to prevent diproportianate impact on vulnerable communities, and that it is ineffective and unenforcable, putting it in violation of the mandate established by AB 32.

Basically, the idea seems to be that evil corporate interests will simply buy their carbon offsets and keep pumping out emissions in industrialized areas which tend to where at-risk communities live.

We'll see where it goes...

Will poor take the brunt of global warming fight? [Sacramento Bee]

An Ocean of Possibility (and Cost)

2009-06-10T09:18:00.000-07:00

One particular corner of the renewable energy world that has been off my radar screen recently is the much balleyhooed wave energy and/or marine current energy. It's no secret that, while this is hypothetically feasible, it's an economic boondoggle.

To back that up, consider this statistic from a report prepared for the California Renewable Energy Transmission Initiative:

"...wave and marine current power generation can cost as much as $445 per MWH and $410 per MWH, respectively. Other renewables like wind, solid biomass, hydroelectric and geothermal have clean energy generation costs nearing $150 per MWH."

The write-up in Earth2Tech admits that this isn't exactly "news" but it does kind of jump off the page at you when you see it in print.

Why Wave and Tidal Power Are Lost At Sea — It’s Darn Expensive [Earth2Tech]

Where The Green Jobs Are

2009-06-09T09:12:00.000-07:00

Ask anyone in California to enumerate the differences between northern and southern California and you are likely to get two very distinct profiles.

Rightly or wrongly, NorCal has a more progressive political reputation and nowhwere is that more manifest than in environmental issues. So it would stand to reason that northern California would be the cradle of the state's new green energy economy, right?

Wrong.

According to a new "Green Economy Map" of California, it is southern California where the green economy has taken root and where it is likely to grow and prosper.

According to a Reuters report:

"Los Angeles County has more businesses than any other county in California that stand to benefit from the state's leadership on climate change, according to a first-of-its-kind map of green businesses in California.

The map was released in conjunction with a report outlining how the Los Angeles area can leverage its environmental leadership to create economic opportunities.

The California Green Economy map features more than 2,200 businesses statewide in four categories-energy generation, energy efficiency, green building and transportation-that are likely to grow as California transitions to a low-carbon economy. "

In fact, Los Angeles, San Diego, and Orange Counites top the charts in the study. For full disclosure it should be noted that the map was released as part of a report on L.A.'s "greenprint," and one indisputable truth of "studies" in general is that data is fungible, but the findings are nevertheless, notable.

First-of-its-Kind Map Depicts California's Green Economy [Reuters]

Sonoma Steps Up to Hyrdrogen Fuel Cells

2009-06-08T09:10:00.001-07:00

Sonoma County apparently as sealed a deal to power to its campus of administrative buildings, inlcudeing a courthouse and a jail, with hyrdrogen fuel cells. Earlier this year, there was chatter that such a deal was in the works, but yesterday a Connecticut newspaper reported that the deal was completed.

According to the Waterbury Republican-American:

"Danbury-based FuelCell Energy Inc. said Friday it has sold a power plant to Sonoma County, Calif., to power a 14-building county office complex, which includes a prison, in Santa Rosa, Calif.The Direct FuelCell, or DFC, power plant will be built at FuelCell Energy's 65,000-square-foot manufacturing facility in Torrington.

It will generate 1.4 megawatts of ultra-clean electricity, and its byproduct heat will be recovered and used to replace approximately half the natural gas the county currently purchases to make hot water for space heating, cleaning and cooking, the company said."

California county buys power plant from FuelCell Energy [Waterbury Republican-American]

Ted Craver for President!

2009-06-05T09:00:00.001-07:00

Edison CEO Ted Craver is wasting his talents in the private sector-- he should be in politics! In an interview with Reuters, Craver demonstrated and Obama-like ability to hedge his comments, take both sides of the same issue, and use consumers as a human shield for his true agenda.

On the subject of renewable energy, he noted that consumers are willing to pay more for clean energy (i.e., we're all in this together, let's save the planet) BUT we can't hit consumers over the head with huge price spikes so we need time to phase in renewables gradually (i.e., don't make me actually bet the ranch on renewables...).

Mirroring this hedged position, Reuters notes that the Edison corporate structure consists of two primary operational entities-- Southern California Edison, which is the largest purchaser of renewable energy in the country, and Edison Mission Group which generates most of its power from buring coal.

Telling Reuters that in a "carbon constrained world" utilities will need to "adapt or die," Craver signals a willingness to take the plunge, albeit very slowly.

Add renewables, not cost: Edison International CEO [Reuters]

Taking Solar to the Extreme in San Diego

2009-06-04T08:59:00.000-07:00

The inescapable takeaway from a write-up in Energy Current about reactions to the recently proposed draft energy blueprint for San Diego is that at least one county supervisor must have sunstroke.

The plan is, at worst consistent with the rest of California's stated energy objectives, and, at best, pretty aggressive. Not so, says San Diego Supe Dianne Jacob who panned the blueprint for setting anemic solar energy goals.

According to Energy Current:

"That draft said the region should use energy more efficiently, modernize its electric grid and boost reliance on green power to the point that sun, wind and other clean sources account for half of local electricity by 2030.

But the plan focuses far more on large, remote commercial solar and wind farms than on the small panels people put on their roofs. "

-and-

"SANDAG's draft policy suggested boosting the amount of sun power generated by residential rooftop panels from 50 megawatts today to 210 megawatts by 2020 and 249 megawatts by 2030. "

Jacob's response? Not enough rooftop solar.

Currently rooftop solar is capable of supplying 1% of the region's power needs. The county blueprint calls for increasing that 400%.

Jacob's response reminds me of the great story about Los Angeles philanthropist Dorothy Chandler accepting a check from a wealthy donor for one of her civic improvement charities, glancing at it, and-- to the donor's horror- tearing up the check in front of a room full of A-list attendees, and saying, "It's not nearly enough."

Official warns against wimpy solar goal [Energy Current via Yellow Brix via North County Times]

I'd Like To Buy A Vowel...

2009-06-03T11:23:00.000-07:00

The answer to the nuclear conundrum that lies at the heart of California's moratorum on new nuclear power facilities, could be found in a single vowel.

Commercial nuclear reactors rely on nuclear fIssion, which produces the nuclear waste that we have no place to keep, but nuclear fUsion could not only generate power but eliminate nuclear waste.

This is a perfect solution in theory only because, to date, achieving nuclear fusion-- basically the same reaction that takes place within the sun or within a thermonuclear weapon-- has been impossible. However, with the unveiling of the new super laser at the National Ignition Factility, Discovery Magazine speculates that nuclear fusion, just might be possible, and it might be the solution to eliminating nuclear waste.

According to Discovery:

"In a fusion-fission hybrid reactor proposal suggested by NIF researchers, a fusion chamber would be surrounded by a blanket of fissionable material, like nuclear waste, that would serve as an additional fuel source…. It would work by using the neutrons from fusion to help turn nuclear waste into nuclear fuel and then burn it until almost none is left..."

Could a New Generation of Power Plants Turn Nuclear Waste Into Clean Fuel? [Discover Magazine]

Roundup

2009-06-02T09:46:00.001-07:00

Lots going on today but several things to note:

The State Lands Commission threw a haymaker at Arnold last night over his proposal to revive offshore drilling at Tranquillon Ridge. John Garamendi called it a "naked power grab" and the Commission passed a resolution urging legislators to kill the proposal. The Los Angeles Times has the story.

The Wall Street Journal has a gratuitous but comprehensive blistering editorial against ethanol. Not much new but if you want to brush up on your facts about why ethanol is a boondoggle, it's a pretty succinct primer. Here is the link.

Lawrence Livermore laboratory unveiled the world's strongest laser which Escapist Magazine describes thusly: "[the laser] boasts 192 separate laser beams and takes up an entire football field of space, can be focused on a single point no bigger than the size of a pencil eraser, making the NIF the world's strongest laser beam." Here is the link.