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Posts from — March 2010

Integrating Renewables: Have Policy Makers Faced the Realities?

Most analyses and reviews of utility-scale, highly intermittent new renewables, especially wind power which will be the focus here, are lacking in perspective. This makes marginal aspects appear to have significance out of proportion to the very little value they represent.

A few examples are:

· A focus on the energy contribution (MWh) from wind power leads to error in assessing the contribution to electricity costs, reliability, impact on fossil fuel consumption and CO2 emissions, transmission needs and the operation of an electricity system.

· The possibility of some improvements in wind forecasting. Given the current state of weather forecasting in general, it seems difficult to believe that wind can be forecast for short time intervals, say 24 hours in advance. In any event, even if such forecasting was possible, it does not change the need for balancing generation plants to be ramped frequently to mirror wind conditions.

· The use of statistical averaging over long time periods, which obscures the more important real time effects, to show low impacts of various aspects of introducing utility-scale wind plants.

Similarly in media coverage,

· The Economist Technology Quarterly review in the March 6, 2010, issue  highlighted the use of a technology that will allow individual wind turbines to sense the upwind conditions and adjust blades accordingly. It concludes with, “The result is a system that can already improve electricity production by 5%.” What if increased electricity production from wind actually increases fossil fuel use and CO2 emissions, stresses the grid and other generation plants and leaves users more at risk when such production falls rapidly shortly thereafter?

· A Canadian national newspaper column proclaiming the virtues of new renewables over traditional electricity sources included a picture of a mass of electricity transmission towers to illustrate a disadvantage of existing technologies. What was not considered was that substantially increased grid deployment would be required to transport the output from new renewables in necessarily wide-spread locations to demand centers.

The result of these marginal, and often invalid, representations is to artificially make unfeasible new intermittent renewables, especially wind plants, somehow appear attractive.

USAEE Article

To assist in providing a basis for the effective evaluation of these renewable sources, my recent article in the USAEE Dialogue proposes a broad framework to assess how the available electricity generation sources, both new renewables and those that are more traditional, meet public policy objectives. These objectives are suggested to be: [Read more →]

March 31, 2010   7 Comments

U.S. EPA Goes Unconstitutional: Time to Rein in a Rogue Agency

Synopsis: The U.S. Environmental Protection Agency, by pulling its punches in the Massachusetts v. EPA Supreme Court case, granting California a waiver to regulate greenhouse gas emissions from motor vehicles, and declaring greenhouse gas emissions a danger to public health and welfare, has positioned itself to regulate fuel economy, set climate and energy policy for the nation, and amend the Clean Air Act – powers never delegated to EPA by Congress. It is time to rein in this rogue agency. The Congressional Review Act Resolution of Disapproval introduced by Sen. Lisa Murkowski (R-AK) is the way to do it.

When did Congress tell the U.S. Environmental Protection Agency (EPA) to license California and other states to adopt non-federal fuel economy standards within their borders? When did Congress tell EPA to act as co-equal or even senior partner with the National Highway Traffic Safety Administration (NHTSA) in setting fuel-economy standards for the auto industry?

When did Congress tell EPA to establish climate and energy policy for the nation? And when did Congress tell EPA to “tailor,” that is amend, the Clean Air Act to avoid an administrative debacle of its own making?

The answer, of course, is never, never, never, and never. EPA is flouting federal law and the Constitution. 

Murkowski Resolution: Averting the Regulatory Avalanche

Congress may soon get its first real opportunity to rein in this rogue agency. Sometime between now and May 25th the Senate is expected to vote on Sen. Lisa Murkowski’s Congressional Review Act (CRA) Resolution of Disapproval. This measure would veto the legal force and effect of EPA’s endangerment finding – the agency’s official determination that greenhouse gas (GHG) emissions endanger public health and welfare. If allowed to stand, the endangerment finding will trigger a regulatory cascade through multiple provisions of the Clean Air Act.  As explained in previous posts (here, here, and here), America could end up with a regulatory regime far more costly than any climate bill Congress has either rejected or failed to pass, yet without the people’s elected representatives ever voting on it.

By EPA’s own admission, the endangerment finding leads to “absurd results” — administrative burdens that undermine environmental protection, economic growth, and congressional intent. [Read more →]

March 30, 2010   6 Comments

Data Dredging for Dollars, EPA Style

As a person who likes to stay abreast of our ever-expanding government in my areas of specialization (energy and environment), I periodically survey the website of the U.S. Environmental Protection Agency (EPA) to see what they are funding with my taxpayer dollars.

Imagine my surprise when I encountered a novel Request for Proposals at their National Center for Environmental Research seeking to recruit people at non-profit institutions to dredge through EPA’s databases in order to gin up new new things for the agency to worry about and possibly regulate.

Specifically,

The U.S. Environmental Protection Agency (EPA), as part of its Science to Achieve Results (STAR) program, is seeking applications proposing to use existing datasets from health studies to analyze health outcomes for which the link to air pollution is not well established, or to evaluate underlying heterogeneity in health responses among subgroups defined by susceptibility or extent and/or composition of exposure.

And, ever helpful, EPA gives some examples of what such data-dredging exercises might look like: [Read more →]

March 29, 2010   3 Comments

Jimmy Carter Was Better than This! (Why can’t Democrats embrace a free energy market?)

As a Democract, I have asked myself how it is that the current administration could be so consistently wrong on energy policy. There was a time in the days of Bob Kerr, Lyndon Johnson, Sam Rayburn, and Bennett Johnson that energy policy was bipartisan. In fact, those Democratic wheel horses from the great Southwest made sure that the policy–particularly as regarded oil and gas– was somewhat rational.

Carter Was Pro-Drilling Compared to Obama

The last Democratic President to acknowledge the need for exploration was Jimmy Carter, under whom I served as Deputy Assistant Secretary for Oil and Gas. Carter pushed both an offshore 5-year leasing plan and production from the Naval Petroleum Reserves. I know–I was in charge of both.

So despite the Windfall Profits Tax and much hyperbolic rhetoric, President Carter had a foot, or at least a few toes, in the pro-production camp. And it was none other than Carter who set up the Arctic National Wildlife Refuge (ANWR) for drilling (after adequate study) as one of his last acts in office.

The 39th President also initiated both the decontrol of gas dating from the 1950’s and the (phased) decontrol of crude oil and oil products that began with Richard Nixon in 1971 which Reagan simply accelerated with his famous decontrol executive order of January 1981.

Democrats vs. Drilling

But no more! Democrats today seem to want to fly in the face of reality by espousing phantom sources of energy and working at cross purposes with American interests:

Democrats today tend to:

  • Believe in Peak Oil and the imminent end of the hydrocarbon age
  • Accept Global Warming Alarmism unquestioningly
  • Exaggerate the decline in the state of the environment when it is actually improving
  • View hydrocarbons as a threat to modern civilization rather than its creator and preserver and to viscerally oppose oil and gas exploration
  • Exaggerate the environmental impact of oil drilling both on and offshore

All this leads Democrats to support and subsidize trendy new sources of power (e.g. switchgrass!) without acknowledging how limited or how environmentally damaging they are when implemented on a large scale.

This has only a little to do with “free market” ideology. I assert that a centrist–or if you like a moderate liberal–who believes in moderate government intervention (securities regulation, social security, Medicare, single payer health, etc.) can: [Read more →]

March 27, 2010   12 Comments

Rare Earth and Lithium Supplies Cloud Renewables

Rare earths refer to some 17 elements found in Earth’s crust by themselves or combined with other chemicals. Some are scarce and others abundant, but in most every case Rare earths create risk in the renewable energy supply chain under an “energy security” standard.

The metals and their compounds used in battery technologies, windmills, catalysts, and communications technologies are not mined in the U.S. The majority of commercially useful Rare earths come from mines in China, a country that is fickle toward the U.S. in many ways. This energy-security issue contradicts a rationale for taxpayer support for government-dependent energy technologies such as windpower and electric cars.

China’s Rare Earth Monopoly

The Rare earths occupy 57th to 71st place on the periodic chart of the elements. Discovered largely in the 19th century, the minerals have proven useful for modern technologies because of their electrochemical properties. They are crucial to advanced, high-temperature superconducting technologies, in addition to being used in windmills, electric vehicles, and new lighting technologies.

China owns the market for the most important rare earth metals, producing almost 100% of dysprosium and terbium, both crucial to the advanced performance of electric motors and lighting (see figure). Today, demand for the rare metals is booming. But China has been exploiting its dominant monopoly of rare earths to manipulate the market, according to U.S. commodities analysts.


Geographic changes in rare earth production. Courtesy: USGS

These are not internationally traded commodities on transparent markets, so sussing out market price trends is difficult. Analysts surveying the market assert that China is using its market power to control prices and benefit its domestic producers and users. [Read more →]

March 26, 2010   5 Comments

Biofuels as America’s Biggest Loser (with apologies to NBC)

Biofuel mandates in the U.S. suffer from a high-octane blend of politics and special interest agendas that have corrupted physical science, economic analysis, and the policy prescriptions alike. This is the predictable outcome when process and policy are de-linked from basic economics and marketplace realities. Unintended consequences and distortions always result.

Historian, professor and author Burton Folsom in his book, The Myth of the Robber Barons, makes an important distinction between “market entrepreneurs” and “political entrepreneurs.” Market entrepreneurs compete by utilizing their own funds, resources and private investment in an effort to create and market a superior product. Political entrepreneurs, on the other hand, fund their business models off of government subsidies, federal protections and vote buying.

This is a useful distinction to keep in mind when evaluating the perverse outcomes of the subsidized U.S. ethanol industry where the participants consist mainly of political entrepreneurs.

Baker Institute (Rice University) Study

Corn-based ethanol and other U.S. feedstock biofuels programs are not supportable on economic, environmental nor logistical grounds. That is the conclusion of a recent comprehensive study by Rice University’s James A. Baker III Institute for Public Policy, Fundamentals of a Sustainable Biofuels Policy. This report was previously cited by Ms. Caroline Boin in her recent post, in which she correctly labels the U.S. biofuels program a “scam” and little more than a sop to farm lobbies and corporate agri-business interests. In short, the Baker Institute study represents a clear indictment of the nonsense that passes for federal energy policy.

One key recommendation from the study is that Congress reconsider its biofuels volume mandates outlined in the Energy Independence and Security Act of 2007.

EISA called for production targets of 9 billion gal/year of biofuels in 2008 increasing to 36 billion gal/year by 2022. Corn ethanol is capped at 15 billion gal/year of this total but even that will be nearly impossible to reach due to significant logistical and commercial barriers that exist (aside from the fact that virtually no environmental benefits are derived from ethanol).

The Baker study identifies multiple reasons to question achievability of mandated volumes, claims of energy independence and alleged environmental benefits cited by ethanol advocates. A few are outlined below. [Read more →]

March 25, 2010   10 Comments

A “Solution” to the “Energy Situation”? (Glenn Schleede Responds to a Critic)

Mr. Schleede:
I’ve read your position on wind farms and their associated problems with a great interest.  Can you tell me when we can expect to receive your solution to the energy situation here in the US?

I look forward to your response. 

Regards, ______________ Fairfax, VA

Dear Ms. _____:

Thanks for your note. You certainly do flatter me with your expectation that I could produce a “solution to the energy situation here in the US.”  (But I suspect that was not your purpose.)

As you may know, U.S. political leaders and government officials at both the federal and state levels — not to mention hundreds of smart people in universities, business and non-profit organizations — have been seeking that solution for at least 35 years.

The U.S. Department of Energy and its predecessors have spent over $150 Billion (2006$) on “energy R&D” and, unfortunately, have little to show for it.  That doesn’t include more billions in federal and state tax credits, credit programs and other subsidies of various kinds (e.g., cash, regulatory, government official lobbying) to promote energy technologies selected by government officials.

Numerous “promising,” government-selected energy technologies have emerged and retreated during the past 35 years.  (You can find references to dozens of them in Presidential messages, the Congressional Record, or in hundreds of press releases.)

Looking back, it’s now quite clear that these “promising” technologies that were selected for government support always

(a) take longer to develop,

(b) face technological hurdles,

(c) have unacceptable environmental impacts, and/or

(d) cost much more than their promoters claimed. [Read more →]

March 24, 2010   8 Comments

Howlin’ Wolf: Paul Ehrlich on Energy (Part III: Conservationism)

Editor note: Part I examined Dr. Ehrlich’s views on Julian Simon, growing energy usage, and depletion. Part II examined his errant energy forecasts. (Previous posts on the worldview and statements of Obama science advisor John Holdren are here.)

Energy conservation(ism) was the Ehrlichs’ silver bullet for fossil-fuel depletion. Current usage levels were decried as enormously wasteful. Depletion and climate change called for “a reorganization of the American way of life” to cut energy usage in half or else “the nation would go bankrupt.” [1] The bankruptcy would come after “frequent unpredictable blackouts and brownouts, the continual need to devise more ‘emergency’ measures, and the return of closed gasoline stations.” [2]

Transportation Usage

On the transportation side, smaller cars, alternative vehicles (even with “miserable pickup”), “slower coast-to-coast transportation,” and an end to two-car families were recommended as, potentially, “the cost of survival.” [3] Paul Ehrlich took on automobiles as status symbols with sarcasm:

“Cars are for transportation, and proper use of the media could once again persuade American men to get their sexual kicks out of sex (not reproduction) instead of a series of automotive sexual surrogates. Restriction of families to ownership of single small cars also would put some pressure against over-reproducers.” [4]

Another part of his “auto-control program” was a ban on motorized camping on public land so “people could be encouraged to regain an appreciation of their place in nature.” An exception was made “for those physically unable to back-pack.” [5] The use of off-road vehicles (dirt bikes, dune buggies, all-terrain vehicles, etc.) was censured as devastating the environment. [6] Government agencies could lease “special purpose vehicles . . . to provide whatever level of usage is determined to be ecologically acceptable” on public lands.[7] In the longer term, “America’s transportation system could be redesigned to minimize the need for automobiles and trucks and maximize the use of feet and bicycles for local transport.” [8] Trains and planes as public transportation (“mass transportation”) were to be utilized for long distances. [9] This makeover of the transportation system “means our settlement patterns must also change” toward urbanization and away from “leapfrogging suburbs.” [10]

So long as cars existed, their number, size, mechanics, and fuel consumption had to be regulated to minimize oil usage.[11] “The large automobile should disappear entirely, except for some taxis, and these could be designed to run economically.” [12] Lower speed limits were suggested. [13] Cars should be designed to be recyclable. [14] Consumers were invited to boycott “one or more” of the automobile manufacturers’ products. [15] Consumers were also urged to buy used cars rather than new ones. [16] Automobile vacations were discouraged, as were three-day weekends responsible for “enormous jams on highways.” [17] A monthly step-up in motor fuel taxes was recommended “until gasoline costs $2.50-$3.00 per gallon, comparable to [1990] prices in Europe and Japan.” [18] In the long run, Paul Ehrlich believed, cars would have to be powered by an energy source other than gasoline. [19]

“Many other restrictions,” such as banning power lawnmowers in the suburbs, were part of Paul Ehrlich’s ideal world. [20] A side benefit (he liked to tie-in his policy objectives) was offered:

“People in those areas might learn to plant attractive displays of native plants rather than struggling with pesticides, fertilizers, and mowers to keep a monoculture of grass under control. And as a result their lives, and those of their neighbors, will become quieter, more relaxed, and less polluted.” [21]

Electricity Usage

Ehrlich and Harriman considered “the generation and use of electric power . . . [as] one of the prime activities that results in environmental deterioration.” [22] They worried that at the usage growth rates encouraged by electric utilities, “every square inch of the United States would be covered with conventional power plants in two hundred years or so.” [23] Consequently, [Read more →]

March 23, 2010   3 Comments

Coerced Energy Efficiency in Texas: Government Conservationism Isn’t Market Conservation

[Editor note: Texas has been a hotbed for energy mandates and environmental pressure groups ever since Enron successfully lobbied for the state to enact a strong renewable energy mandate in 1999. This mandate was expanded in 2005, and the a second expansion (with a solar carve-out) almost passed in the last session. Currently, environmental pressure groups are working to toughen an energy efficiency mandate enacted in the same 1999 law and extended in 2007.]

The Texas Public Utility Commission (TPUC) is in the midst of a rulemaking that would expand Texas’s energy efficiency program. Questions of administrative overreach aside (the state legislature rejected the program last session), a sober look at costs versus benefits indicates it is a very questionable deal for ratepayers.

Some will argue that more government-directed conservation (or conservationism) is a good thing. After all, it is frequently claimed that the existing efficiency program is cost-effective based on 2001–2009 data.

In reality, however, the record provides no such justification. Actual expenses for the program in 2008 were at least $57.9 million, and projected expenses for 2010 are $105 million. These costs are paid for by residential and commercial electricity consumers. The PUC says the benefits of this program outweighs its cost. But the commission currently uses a cost-benefit method that does not accurately measure the program.

PACT Problem

Texas is almost alone among the states in using a Program Administrator Cost Test (PACT) to evaluate its efficiency programs. Yet the California Standard Practice Manual, used as a reference in many other jurisdictions, explicitly warns against PACT: “By defining device costs exclusively in terms of costs incurred by the administrator, the results reflect only a portion of the full costs of the resource.” [Read more →]

March 22, 2010   No Comments

Howlin’ Wolf: Paul Ehrlich on Energy (Part II: Failed Predictions)

[Editor's note: Part I in this five-part series examined Dr. Ehrlich's views on Julian Simon, growing energy usage, and depletion. Part III examines Ehrlich's conservation(ism) views.]

The Ehrlichs’ angst about the energy future was rife with forecasts that have been proven false–and embarrassingly so. As mentioned in Part I, the Ehrlichs’ protégé John Holdren has made similar radical pronouncements and wild exaggerations (see here and here) and even joined Stephen Schneider and other climate scientists in the global cooling scare.

Running Out of Oil

Writing in 1974, the Ehrlichs predicted that “we can be reasonably sure . . . that within the next quarter of a century mankind will be looking elsewhere than in oil wells for its main source of energy.” [1] Consequently, “we can also be reasonably sure that the search for alternatives will be a frantic one.” [2] He predicted that proved world oil reserves were no more than 35 years of supply at current demand levels. [3]

“The energy mini-crisis [of the 1970s],” the Ehrlichs confidently concluded, “illuminated once and for all the hopeless incompetence of our political leaders and our institutions when it comes to coping with fundamental change.” [4] More generally, the Ehrlichs predicted that “America’s economic joyride is coming to an end: there will be no more cheap, abundant energy, no more cheap abundant food.” [5] Thus, “continuing to increase our dependence on petroleum consumption is clearly a suicidal course of action.” [6] [Read more →]

March 20, 2010   10 Comments