P58. Pick Points

Back in November 2007, with relatively little notice Con Edison ended a service begun by Thomas Edison in 1882. It was the transmission of electric power by direct current (D.C.) in New York. There was fierce rivalry back then between Edison, who favored D.C, and George Westinghouse who was pushing Nikola Tesla’s alternating current (A.C.).

Some 125 years later, Westinghouse finally and absolutely has prevailed as the world has moved to AC. Or has he? Back a couple of years ago I was at an ASPO meeting when Dave Rutledge (who is inter alia a Division Chair at Caltech) mentioned the resurrection of DC power transmission. At first I thought this was a mis-speak so I asked him about it afterwards, and no I had heard him right.

So there I was, today, half-listening to Dr Chu build up to explaining what the Helios Project at the Berkeley Lab was all about, when I heard him comment on the Smart Grid, and the benefits of transmitting current across the country using D.C. lines rather than AC. Unfortunately the feed I was watching (this was from last July) did not have a timer on it, but this was about a third of the way into the talk.

Dr. Rutledge had mentioned that one of the places that uses D.C. is in Denmark, and sure enough, cables between Norway and Denmark do transmit power using D.C., and they are adding more.
In modern systems high voltage D.C. lines are less expensive and suffer lower transmission power losses than A.C. lines, but require more expensive transformers to raise the voltage to the high levels required. One of their advantages, however, is that they make it easier to integrate remote generating capacity into a network. This will become more important as renewable energy sources dotted around the country start to be available for integration into a new Smart Grid in greater numbers.

While the wave energy program in Portugal is in hiatus, a project to further study its use in Hawaii is making progress with the system to be upgraded. There is a difference between tidal energy and wave energy, and in Scotland Aquamarine is picking the latter to be a better bet than the former. The wave energy program is known as Oyster. Further a new Israeli turbine is being developed which is claimed to reduce costs, and there is a competing idea being developed in Ireland.

Gazprom anticipates that its exports will drop some 17% this year and that prices will also drop. It is therefore not surprising that they are looking more favorably at LNG and new projects that will open this additional avenue for sales. It does not seem that long ago that they were arguing the other way, with all their efforts being put into pipeline transmissions. This was particularly true for Shtokman development, though now this is where business is anticipated to gestate.

While the volcanic eruptions at Mt Redoubt are apparently calming down , they are generating a bit of a problem for the local oil production facilities

With oil terminal operations suspended at Drift River, Cook Inlet oil producers are running out of space to store crude. Chevron shut in two of the 10 platforms it operates Monday night, spokeswoman Roxanne Sinz said Tuesday. The Bruce and Anna platforms normally produce about 71,000 gallons of oil a day, Sinz said.

Production was reduced by about 21,000 gallons daily at the Dolly Varden platform because of ash, Sinz said. . . . .
In Cook Inlet, with Drift River out of commission and no means to move oil to market, only seven days of storage remains at the production facility at Trading Bay, while tanks at Granite Point to the north have about four more days of storage, Chevron's Sinz said.

When the space is gone, either Drift River has to reopen or the platforms must be shut in, Sinz said.
Cathy Foerster of the Alaska Oil and Gas Conservation Commission said some wells could be forever lost if they are not continually producing. But crews can continue to pump oil from those wells into other wells if there are no tanks to store the oil, she said.

At the news conference Tuesday, representatives from the Alaska Department of Environmental Conservation, the Coast Guard and Cook Inlet Pipeline Co., which owns Drift River, said their main concern continues to be the 6 million gallons of crude stored at the terminal. The facility was evacuated last week, but the pipeline company has sent crews to inspect it when it's been safe to fly.

And Russia is proposing a nuclear power station for Bangladesh . The facility would produce 1,000 MW and help meet the growing need (and shortage) of power in that country.

And in China they are getting the wires to build superconducting cables to move electricity. Superconducting cables can handle up to ten times the power of conventional cables and have additional benefits when transmission lines become congested.

P51. Pick Points

Half-a-dozen or so stories of interest:

The energy lobby is not thrilled about the latest plans to increase taxes on the industry and is now forming a group to speak up for the industry. As an alternative North Dakota is thinking about putting 25% of the oil generated income into a trust fund. While Ecuador is going after some unpaid taxes that it claims Perenco, a French oil company, owes due to the “extraordinary profits” the company has made. Michigan’s Governor is asking for a gas tax to fix the crumbling roads in the state. The intent is to shift the rate from a per gallon, to a percentage of the price. Because state and federal revenues from existing taxes are no longer enough the Congress is also looking at ways to restructure the system to raise more revenue, one of the thoughts being considered is a mileage charge. Massachusetts has a similar problem, and are considering a 25% increase in the state gas tax (which would bring in about $650 million), as is Oregon.


Ugo Bardi has his post on “Fire and Ice” up on the main TOD board, (it was on TOD Europe before) and just for the historical record, it was I (not some guy from the USGS) who disagreed with Dave Rutledge down at ASPO 2007 – which did not stop the pair of us, with a group of others, adjourning to the bar to discuss the topic thereafter.

Speaking of conferences the MIT student Energy Club just held their conference at which the Swedish company Vattenfall said that they would be carbon neutral by 2050. Sweden has previously said that it will wean itself from oil within the next fifteen years . Sweden gets most of its electricity from nuclear and from hydro, so that the major use of fossil fuels is in transportation. I should be in Sweden this weekend (there will be a slight hiatus since it is a long flight and I am going to work) so I will post on what I hear.

At the start of an Energy Conference in Qatar the Exxon CEO has used their success with Qatar (they will have doubled the LNG production to 62 million tonnes this year, leading to the establishment of fourth and fifth LNG trains). Half the vessels for the 4th train are now delivered, and 5 of the 6 for the 5th train. The LNG is coming into a market that is currently seeing (outside of South Asia) a surplus of natural gas (hence all the rig closures in the US) and the LNG entry is likely to soften the market further. However if the predictions of a drop in US well production hold up, then the LNG will be coming on market just as it would otherwise tighten. China, which currently uses 13 million tonnes of LNG , with imports from Russia and Kazakhstan, is also aiming for a target of 60 million tonnes a year by 2020, with some of that to come from Qatar. A local shortage of natural gas is also causing Saudi Arabia to fast-track the development of two off-shore gas fields.

Development of the Arabiyah and Hisbah gas fields, which are not associated with oil production, would supply around 1.8 billion cubic feet per day, MEES reported. The projects were included in Aramco's expansion plan through 2014, it said.

"Bringing these fields on line would make sense," one industry source in the kingdom told Reuters yesterday. "They really need the gas."

Success offshore has not been matched with equivalent searches for natural gas on land, and particularly in the Empty Quarter.

Utility operators in the United States continue to be concerned over the future of coal, and are scrapping even more plans for expansion, part of the problem lies in the uncertainty over future regulation. Just this past week a utility in Montana has given up on the fight with local environmentalists and will now be installing a gas-fired plant, even though the costs may be higher. There are still, however, some 28 coal-fired plants under construction. To prevent more ash dam failures, EPA is seeking the necessary information on the sites where such impoundments exist. There may be as many as 300. Idaho Power, having seen the writing on the wall, has also changed its mind, and instead of a coal-fired plant will be installing a 300 MW plant in Payette county. The site is close to an existing gas pipeline, and an existing 230-kV transmission line. Now all they need to worry about is the long-term availability of the fuel.

A small note, it appears that having not had them built for very long, China has already filled the current round of tanks for their Strategic Petroleum Reserve and is thinking of adding more storage using tankers. (Which suggests they don’t think prices will stay down much longer, either). They currently have 34 days of supply in storage., but this may not count the 100 million barrels in the reserve. China is actively chasing after oil, and trying to ensure supplies when the price is right. And there are still those who think that the floor of the market has not yet arrived and that prices can sink some more.

And Pakistan has decided to go ahead with a gas pipeline from Iran, without having Indian participation.

More stories can be found at The Energy Bulletin and Drumbeat at The Oil Drum.