Deepwater Oil Spill - the Presidential Speech

The secondary collection system, using the Q4000 has now been activated to help collect the growing volumes of oil generated from the oil spill at the Deepwater Horizon site in the Gulf of Mexico. There was also a small fire, yesterday, due to a lighting strike, that shut down collection for a short while. The current status is thus

For the last 12 hours on June 15th (noon to midnight), approximately 4,830 barrels of oil were collected and 14.6 million cubic feet of natural gas were flared.

• On June 15th, a total of approximately 10,440 barrels of oil were collected and 25.1 million cubic feet of natural gas were flared.

• Oil collection volumes were lower on June 15th due to the direct lightening strike on the Enterprise.

• Total oil collected since the LMRP Cap containment system was implemented is approximately 160,400 barrels.

• Collection commenced on the Q4000 at ~9:50pm with hydrocarbons reaching surface at ~1am on the 16th. We expect to optimize collection over the next few days.

The President has now given his Oval Office Address to the Nation on the Oil Spill, and I will update this as the news of his discussions with BP officials goes on. But the speech itself is worth examining. The most critical part of the spill is to get the leak stopped. It was the first significant topic of the speech, but this is what he said:

Because there has never been a leak this size at this depth, stopping it has tested the limits of human technology. That's why just after the rig sank, I assembled a team of our nation's best scientists and engineers to tackle this challenge -- a team led by Dr. Steven Chu, a Nobel Prize-winning physicist and our nation's Secretary of Energy. Scientists at our national labs and experts from academia and other oil companies have also provided ideas and advice.

As a result of these efforts, we've directed BP to mobilize additional equipment and technology. And in the coming weeks and days, these efforts should capture up to 90 percent of the oil leaking out of the well. This is until the company finishes drilling a relief well later in the summer that's expected to stop the leak completely.

So the recommendations of the “nation’s best” is “do better?” or “do more?” To which BP has responded by bringing in more collection equipment, but has not changed their current response to sealing the leak – which is basically to rely on the relief wells. (Although I did hear some stories that it was the “expert” team and Dr. Chu that told BP to stop the Top Kill attempts). But that was all the coverage that the most critical part of the speech provided.

The problem, of course, is that the problem is not solved until the leak is closed. Thus the “X days of the Gulf Crisis” that is the mantra of the main stream media will likely continue until X reaches about a hundred, and by then, barring some further catastrophe (and I’m not ruling one out) the public may be rather tired of the story. The clean-up is vital, dealing with the compensation for those who have lost wages will become interesting.

BP have just agreed to set up a fund of $20 billion to recompense those who have lost jobs and livelihoods. They have also suspended their dividend for the rest of this year. But the Administration gave BP some years to create the fund, so that the company does not get wiped out. They also agreed to create a $100 million fund for those in the oil patch who have lost work because of the moratorium on drilling.

It gets them off the hook, but I am very dubious that it will accelerate payments to individuals and companies. While BP had the responsibility they had to hire the accountants, clerks, and administrators to oversee the distribution. These folks had to have rules, which had to be written, and paperwork documentation of claims had to be established. Getting that done as fast as it was is something that private industry, with the right incentives, can largely achieve.

But if the whole process, or significant parts of it, have now to be redone with a different set of rules to be established, then BP can now claim no responsibility, and it will be the Administration which starts to get targeted as payments continue to be delayed.

Bureaucracies take time to build and once established hard to get around, and that is not going to be true just for those who need a check in the next week or so to pay the mortgage, or feed the kids. With apparently 14 different agencies involved in the clean-up getting all the permissions for particularly innovative approaches had already required some creative thinking, and may require much more if, for example, advanced skimming tools are to be used within meaningful time. Again, based on current performance I am becoming more cynical as to success, as the Administration claims more authority over what is, and is going to be done.

The other half of the speech dealt with the need to accelerate the change to alternate fuels. This is a site that is seriously concerned over the coming shortages of fossil fuels, and oil in particular. So encouraging the development of alternatives is something that needs to be done. Did it need to be in this speech? That is a political issue I don’t want to address. But there were not a lot of specifics in the speech. It was more along the lines of

Others wonder why the energy industry only spends a fraction of what the high-tech industry does on research and development -– and want to rapidly boost our investments in such research and development.

Well the federal agency that used to support such R&D was the U.S. Bureau of Mines, in the Department of Interior. It was one of the few agencies that the Federal Government (in the Clinton Administration) has ever closed. So maybe this isn’t just an industry problem?

So at the end of the day there are no specific new steps to move forward with. We will see what Congress brings forth.

Secretary Chu in Newsweek

My dependence on good internet service has been underlined by a week where it has not been available. Unfortunately the motel we were staying at in Maine had a problem with its server, and we returned home to find a problem with our own internet connection. Thus a couple of the posts that I was completing will be a little delayed, until I have that indispensable tool, a good connection. This has been prepared largely without, and similarly posted with access just to find a couple of references.

And in that meantime I have been perusing this week’s NEWSWEEK, on my Kindle, and noted that the Secretary of Energy had a new interview. The first thing that he said in it was in response to a request to define President Obama’s energy policy. Here is what he said:

We look at all the factors and we say, how can we get to the lowest possible level of carbon as quickly as possible and not only at the lowest cost but with the greatest possible economic opportunity for the U.S.?

That’s it!

The rest of the interview was not that much more constructive (one of the benefits of the Kindle is that it counts words, in this case the article – including questions – ran to 782 words - the attempted length of this piece). There was no mention of peak oil, or energy security or prices in the article. In response to the criticism that the Stimulus package did not make enough investment in energy, the Secretary said that they would fund projects for up to three years maximum, and encouraged innovators to “swing for the fences.” Whatever that means (in context)! I will admit to having helped put a couple or more proposals into the DOE hopper, though most came back rather quickly and negatively (one was successful). What struck me about the process, and the attitude redolent in the Secretary’s remarks was the focus on short term benefits and application. Most of the work is also oriented to larger group efforts, with a lot less focus on the smaller innovator to stimulate new ideas. If you can’t claim a home run within the remaining life of this Administration, don’t bother applying.

He appears to hope for a start to a Smarter Electric Grid, to double renewable energy contributions by 2012, and to get the nuclear power plant construction industry restarted in this term. But he also recognizes that carbon capture and sequestration is at least 10-years away from deployment. His “blue sky” hopes are for cheap (below $2) per watt photo-voltaic systems, (current costs he quoted as being over $4) and he still looks to the generation of fuels such as gasoline directly from biomass. This is not the ethanol production that the industry and government are still heavily involved in, but rather focuses back on the work he was supporting while at LBNL looking at using natural fauna to do the digestion and fuel generation.

But he returned to the need to put a price on carbon, and for a cap-and-trade bill to make sure that the point on where his focus was, would not be missed.

Sigh! He sounds as though the “scientist in a tower” description still fits him like a glove. There are considerable issues in regard to the changing energy supply of the planet that should be giving him pause in his charge against carbon. Increasing numbers of people are pointing to a coming crisis in oil supply. The British government, at the urging of folk such as the head of Virgin Airways, has decided that perhaps it is about time that it took its head out of the sand, and took a hard look at the situation. Of course it is also taking a look at the reality of climate change predictions, though with the coming of a general election, it is not clear whether either effort will amount to much.

I am increasingly struck by the perception that many of the folk that write about both climate change and energy supply do so with a very complacent attitude toward the continuing situation. The potential impact from a major impact on climate from a severe eruption of the Laki suite of volcanoes in Iceland seems to be being totally ignored. (A quick skim through some of the scientific papers suggests that the major eruption follows within a couple of years of the current eruption of the smaller volcano). The problem is that should there be a problem, running around in a panic for a couple of days is going to do nothing constructive in stopping folk from being killed.

Well we will have to see, in the relatively short term, whether that complacency is warranted. Being a Cassandra is unlikely to get more recognition this time around.

A new Massachusetts Senator and energy policy changes

The fate of coal fired power plants is one of those questions that continues to have answers hidden in the fog of their political future. And the election tonight of a Republican Senator from Massachusetts raises some interesting questions about that future. Not the least of these will be the fate of cap and trade legislation, which was already in some trouble in the Senate. And one wonders if it will have any impact in the ongoing debate about the Cape Wind project. This project, to raise a wind farm in the area off the coast of Massachusetts that the late Senator Kennedy and his family apparently sailed in, has been stalled for some nine years since it was first conceived. The process recently ran into another bump with the National Park Service agreeing that the area is eligible for listing as a historic site.

The 560-square-mile area is the first swath of ocean to be determined eligible for listing on the National Register of Historic Places. That decision Monday, based on the sound’s cultural and spiritual significance for two Wampanoag tribes, means the 130-turbine Cape Wind project and all future activities in the Sound that require a federal permit will now have to consult with the Native Americans and try to minimize the impact of projects on the protected area. That consultation will be required even if the sound is never actually formally listed on the register.

The Secretary of the Interior has now met with the Indian tribes, and the proponents of the plan and has promised that there will be a decision before the end of April. The eligibility ruling is apparently somewhat unusual, and has additional consequences relating to fishing and the use of ferries that go well beyond the wind farm issue, and no doubt tonight’s result may also have some impact. But we should find out before the end of April what that might be.

Not all political futures are as quickly resolved. One of those that has been dragging on is the one I started with, that of cap and trade, and Foreign Policy in a major review of the accomplishments of the Obama Administration in the energy field have not been overly kind in their review. And while the election may move cap and trade even further from a Senate vote, the article goes into considerable more depth in considering some of the other perceived failures of the past year.

Here is the back story of how the Obama administration dramatically raised and then dashed America's -- and the world's -- hopes that 2009 would be a pivotal year for remaking our collective energy future.

It has a much more realistic view of the consequences of actions to date, and while it considers that Secretary Chu is a voice of reason in the debate on the energy future, considers that he is a lone voice, and a largely unsuccessful one against the “partisans of the past.”

Virtually every other key policy role was filled by environmental regulators -- former Environmental Protection Agency (EPA) head Carol Browner as climate czar, former Browner aide Lisa Jackson as EPA administrator, and Nancy Sutley as chair of the White House Council on Environmental Quality.

The authors feel that the emphasis on energy conservation – a major plank in the immediate future – is part of “magical thinking” of the future where desired outcomes will occur almost at the cost of merely wishing them so.

In this view, energy efficiency pays for itself, solar and wind power are already nearly cost competitive with fossil fuels, and both can quickly and cheaply reduce emissions. This Pollyanna view of fossil fuel alternatives and efficiency, which makes going green seem cheap and easy -- little more than the cost of "a postage stamp a day" -- has provided the justification for green-policy advocacy that has overwhelmingly focused on pollution regulations and carbon pricing while ignoring serious investment in energy research and development.

Some of the roadblocks to the anticipated “magical change” in the energy supply of the country are already evident. The resistance to a wind farm in Massachusetts from the Democratic Establishment there; the blocking of sites in the Mohave Desert that would contain solar and wind farms by Senator Feinstein - to give examples on both coasts – illustrate some of the problems that the reality of renewable energy provision must get through in order to continue to increase the percentage power that it provides to the nation. (And it is still not nearly as much as the public perception of its impact has been, I suspect).

Unfortunately that is not the sum of the national woes. For in reading the Foreign Policy piece, what struck me was the lack of understanding on the part of the authors of the potential future problems of overall energy supply.

The grip of the “greens” on short-term energy policy will likely make it increasingly difficult to build new coal-fired power stations. Secretary Chu, driven in part I suspect by his own view of Climate Change, is focusing on finding long-term solutions to the provision of electric power, with the benefit that dealing funds to that aim helps his constituency in the National Labs. But in the process neither side pays much attention to the possibility of nearer term problems of energy supply.

But there are some warning signs (apart from the ones that I write about in most posts relating to the coming difficulty in producing enough oil to meet global demand – which Goldman Sachs now expects to happen next year). And these concerns are illustrated by example. For in the United Kingdom the power companies are requesting that some of the coal-fired and nuclear power stations be kept around after the European Union regulations require that they be closed.

"Given that the issue we are trying to grapple with is climate change, there is a question mark over keeping one or two of these oil or coal fired plants mothballed to secure supplies for a few days per year when we get these conditions," Golby (chief executive for E.ON UK) said.

"It might be a small economic and carbon premium worth paying for security of supply and getting us through this transition to a low-carbon energy system. It's something we have talked to the government about."

Golby's view is privately supported by many UK power station operators who fear a looming energy gap in a few years when old coal and nuclear plants have been closed but new reactors, clean coal plants and wind farms have not been built.

So the new Senator enters an arena where the debates, actions, and inactions of the next year or so may have a very significant impact on whether or not there is sufficient power in this country after 2015. Let us hope that he understands that.

Geologic Time, Oil Formation and Secretary Chu

Last week ,as Climate Audit caught, the Seretary of Energy was asked about how oil and gas got into the Arctic Rocks. Now there is a little catch to the question, in that for oil to be formed the local environment has to be quite warm particularly relative to today’s Arctic temperatures (as explained below). Thus, to explain how the oil got there, the Secretary would have to admit that there was a period when the Arctic was warmer than today. However Dr Chu did not want to give that answer, and so he proclaimed that the rock and oil-forming algae were deposited elsewhere and then migrated, under Continental Drift, until they ended up in the Arctic. Steve gave a condensed answer pointing out how wrong the Secretary is on this, but I thought I would use the error as a base for explaining the origins of oil and natural gas in a post that I can then relate to later.

The majority of world opinion on the matter, has concluded that oil and natural gas originated in the bodies of small organisms, such as modern algae, which can include up to around 56% lipid material (their version of fat). This is referred to occasionally as the biotic source, as opposed to an alternate theory, the “abiotic” theory. This latter theory, which came out of Russia and gained some acceptance in the West, in essence says that oil is generated deep underground by chemical reactions, similar to the Fischer-Tropsch process used to make synthetic oil. While the relevance of this process to oil supply has been disputed, it relies in part on the idea that there are deep pools of oil that fill old reservoirs back up after they are depleted and that if we just drilled deep enough to find them we would have an almost inexhaustible supply. And the catch with that relates to the formation of oil and gas through the biotic explanation.


The biotic explanation for oil and gas formation proposes several steps along the way. First we have the rivers and shallow seas where the algae flourished and died. Sinking to the bottom they mixed with the sediment that is also deposited in such places (and which can be seen in parts of the world today). With time, as with the formation of coal, the sedimentary beds that hold the nascent hydrocarbon fuels are buried deeper. With an increasing depth of burial comes an increase in pressure and temperature. As a very rough rule I use 1 psi of pressure for each foot of burial, and 1 degreeF for every 60 ft of depth startin at 60 deg at 60 ft. So that, for example, at a depth of 3,000 ft the ground pressure is 3,000 psi and the temperature will be 110 deg F.

An early step along the way, as our hydrocarbon starts to cook is its transformation to a kerogen. This is the “oil” of the oil shales of Colorado, New Mexico and Utah. It is not yet a liquid and does not flow. To get to that stage it has to be buried deeper and heated longer. That is what Shell is planning to emulate with their process for oil recovery from the shale. By inserting long heaters into holes down through the rock, and raising the temperature to 650 – 700 deg F and holding at that temperature for 2-3 years they hope to complete the transformation. The temperature is higher than that which would be needed for the natural process, because the process must happen faster. With nature and depending on the part of the world you are in (since the geothermal gradient varies) the transition will occur when beds lie in the 3,000 ft to 15,000 depth.) (Temperatures up to 300 deg F range. ) This depth range is often referred to as the oil window, since shallower rocks aren’t cooked well enough and we get kerogen, and if the rock goes deeper then the higher temperatures will “crack” the oil into natural gas.

(Which is where the problem of deeper pools of oil for abiotic oil comes up, since the deeper pools that the theory calls for would exist at depths where the oil would be cooked into gas, and thus no longer available to supply the oil).

As the oil heats it also thins and becomes less sticky so that it can start to slide through the grains of the surrounding rock, passing along small cracks and being pushed up, in part by the water that was trapped in the rock with it, and which starts to collect below the oil. The oil will move up through the layers of rock until it either reaches the surface, or it is trapped below a rock which does not have the passageways (permeability) wide enough for the oil and water to pass through.

Similarly the deeper deposits that have turned into gas will also begin to move up until they too are trapped beneath an impermeable cover or cap rock.

OK, so when did this happen? Well it depends on the place you’re at. But, for example if we go up to the North Slope of Alaska, the rocks that generated the oil are known as source rocks, and the USGS has identified rocks of the Triassic (the Shublick) ; the Jurassic (Kingak) and the Cretaceous periods may all have contributed oil.

Source USGS

Now a quick peek at a geologic column tells us that these are periods of the Mezozoic Era which ran from the end of the Cretaceous ( 65 million years ago) through the Jurassic (ending 165 million years ago) to the Triassic which ended 208 million years ago. They are younger than the Carboniferous, when coal beds were laid down, by some 40 million years or more.

However, to get back to Dr Chu’s point about Continental Drift having carried the oil bearing rocks up to Alaska, after they were formed, if you go to any of the models which show how the plates have moved, the North American plate (which includes Alaska) was already up in place as far as the North is concerned (but then drifted West) by the beginning of the Jurassic.

So while this was a good try by Dr Chu, a Climate Warming devotee, to get around some geological truths, the facts argue against him. (Not to mention more recent findings within the Holocene, our current geological Era), but we'll save those for another day.
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The risks of "cap and trade"

When discussions arise about Climate Change, and the possibility that carbon dioxide and the other greenhouse gases are responsible for the rise in global temperatures, one prevailing argument is that “we cannot afford to take the risk of the AGW argument being right, without doing something.” However, in that discussion, there is rarely any mention of possible negative consequences to mitigating against increased levels of carbon dioxide in the atmosphere. The only positions mentioned are frequently the projections of dramatic rises in sea levels, the promise of worse storms, droughts and climate conditions and other projected severe costs of inaction. The costs of the actions themselves are not addressed, and the implications are that the world will be a better place if some of the current trends in Climate Change are, if nothing further, stopped from progressing further.

But there are costs to the required changes in lifestyle that a reduction in carbon dioxide production will require, and those potential impacts are rarely spelled out to the public, or to the politicians who must enact the legislation to put new laws in place. However politicians, particularly in those districts that are likely to be impacted by the changes in regulations, are already showing some sensitivity to the potential negative aspects of “cap and trade” and so it might be worth exploring the topic in a little more depth.

The Energy Summit in Columbia last week allowed some of the utility companies to spell out the levels of cost that will be incurred if cap and trade legislation is enacted, based on a projected cost for the allowance to generate a ton of carbon dioxide. But they largely built their discussion around the price of that portion of the electricity that they will still be allowed to generate. A cap and trade system, however, comes in two parts. The first part is to look at the overall production of carbon dioxide, say 6 billion tons/year, where the program cuts this back by, say 500 million tons a year. (This is the reduction in the capacity to produce or the “cap.”) For the sake of the following discussion I will assume that 1 ton of coal produces very roughly 3 tons of carbon dioxide to make the arithmetic easier.

The first argument of those who look at this problem of a reduced supply is to suggest that the gap can be met by improving efficiency of electrical use, and conservation. However the implementation of a cap and trade policy is not predicated on that efficiency change happening, but it will occur as a separate event. And Jevons Paradox will tell you that “improving energy efficiency increases energy consumption.” So that the savings in power required are unlikely to be realized.

Which means that if the utilities are restricted in the amount of power that they can generate with carbon-producing strategies, then they must have alternate supplies in place. Theoretically that may well be the case. The number of states that are including a “sustainable source” quotient in their mandated supplies is steadily growing. However, as Montana, for example, is discovering there may be a difference between the targets and the practical realities. As credit has become tight, available funds for new farms are becoming harder to raise, and without a perceived increase in demand, it is harder to justify a new investment in plant when the old coal plant is still producing at a relatively low cost. And without the lead time being used to produce the new energy sources that will be needed, when the time comes to flip that switch, it may not yet be connected.

The problem actually is a little worse that this. Because most of the coal-fired power plants are quite old, and while maintained to continue to produce power, they are less efficient and more polluting that the more modern plants that are planned to replace them. But with the anticipated change in regulation now that EPA has ruled on carbon dioxide , almost all the originally about 200 planned new coal-fired power plants are holding back on commitments and roughly half have cancelled or indefinitely postponed their planned construction. Thus the increased supply of power from new plants may not appear.

There are two additional thoughts to consider. The first is the proposed restriction on emissions from these new plants:

The (Waxman – Markey) proposal unabashedly bans new coal-fired electric plants. In 2009 new coal-fueled electric plants are limited to 1100 pounds of carbon dioxide per megawatt-hour (MWh) and 800 pounds after 2020. Present fossil-fuel electric plants emit the following pounds of CO2 per MWh: 2100 for coal, 1900 for oil, and 1300 for natural gas. . . . The bill that includes "security" in its title limits our plentiful secure coal supply to discharges of about one-half that allowed for oil and natural gas.

The second is that some parts of the country do not have the ability to tap into the wind and solar resources that are currently being suggested as the solution to the problem.

Productive wind is only available in a limited number of states and their regions, and similarly solar power cannot be relied on in a North-Eastern Winter. One cannot legislate an alternative technology that does not yet exist to fill in the gaps between what will be allowed from the power plants of yesterday, and the demands that a rebounding economy may place upon them. Mandating that the older suppliers of power close, before the new plants to replace them are installed will have significant consequences to the available jobs that can be supported, if the factories and industrial base begin to lose the reliability of the power sources that they have today.

Even, however, if they find some way of meeting the target for the renewable portion of their portfolio, the utilities won’t be out of the wood. Because the purchase of the allocation for the carbon dioxide they do admit will also bring additional cost. As noted at the Energy Summit a price of $50 per ton of carbon allocation would likely double electric bills in Missouri. Burning a ton of coal, that now costs $50, would raise its price to $250. While if the price per allocation ton was raised to $200 per ton (which has been suggested as being necessary to support some alternate energy choices) this would raise the cost by a factor of five (i.e. a current electric bill of $200 would rise to $1,000 per month). In much the same way as Secretary Chu recognized at the EIA Conference that increases in the cost of oil contributed to the severity of the recession, one can equally imagine that a similar effect will be felt with an equivalent rise in the cost of electricity.

The current path forward, with a hesitation in construction of new power plants holds the risk that the United States will not have the power that it needs in the future to match industrial and domestic demands. In those cases it is often industry that is the first to see the cutbacks in supply when load shedding is needed. But the resulting drop in production, and international competitiveness, may well damage or destroy the recovering economy after this recession comes to an end. That too is a risk that should be protected against.

The Post and the Secretary - a comment on a discussion

One of the major planned bastions of the Obama Administration is intended to center about a change in the Energy Policy of the country. Given that the folk that are now in charge of a number of issues come from California Congressman Waxman (the 30th District which includes Beverley Hills and Malibu); Senator Boxer from California, and Secretary Chu of the Department of Energy; there is a predilection to call the new policy California-based, rather than the Texas-based orientation of the Bush Administration. And the experiences of the key players will likely color the thinking and planning that will take policy forward. (Recognizing as was noted in the EIA meeting last week, that given the need to get 60 votes out of the Senate, that such a process will dictate adopted policy). So it is interesting, with that filter in mind, to listen to the interview that Secretary Chu gave to the Washington Post today.

The interview begins (the Post listing is not in order, so this was the top bit) with a question on getting folk to use public transport, and conservation as a necessary early step in reducing the national energy demand. The question illustrates the difficulty between setting an overall goal, and the problems in trying to implement those goals in a time of financial exigency. Consider that while, in order to save money in tougher times folk recognize that they are better off taking public transport. The problem is that as that demand goes up, from Washington D.C to Florida, and all across the country, it bumps into the harsh reality that cuts in municipal income are forcing the services to become more restricted. As someone noted “it makes no sense to hire a construction worker, and fire a bus driver.” Unfortunately that part of the question was not fully addressed by the Secretary, though he did note that 60-70% of transportation fuel is used in the private sector, but then focused on the more fundamental theme, that he has expounded upon before, about conservation of energy. In this case he would replace the construction worker with someone that can weatherize your home. (Though still not helping the bus driver). But even here I think he has difficulty. Because to sell this message (that weatherizing your home can pay for itself in a year or eighteen months), requires that he get people to hire folk to work on their homes.


The difficulty with this when times are tougher, is that it is requiring individual members of the public to become involved and actually spend their own money in the process. (We had some small remodeling done over the winter, and according to the folks we hired, there is very little work out there at the moment). In tough times that is going to be a hard sell, high return or not. And while the sale that the Secretary talks about hinges on folk seeing the payback in lower energy bills after the investment, or getting a bank loan to make the improvements, which is a group that also needs to be persuaded.

In regard to the use of solar energy, and particularly photo-voltaics, the Secretary plays around with words. At the moment solar is much more expensive than conventional other fuels. But he notes that if you look instead at the energy supply for peak power then, instead of costing $0.10 per kwh, that currently costs $0.40 per kwh. So that instead of replacing other power sources if one instead makes the comparison with solar (at say $0.23 per kWh) then solar becomes a logical choice. The problem with that argument is that I suspect that solar is only considered as being at $0.23 if the investment can be paid off by continuous supply of power into the grid at the time that the sun is shining, in which case it is displacing existing, lower cost systems. If it is installed and then only run in times of high demand, then ROI would surely drive the costs over $0.23 and it would still not be economical.

Turning to oil dependence he tried to distinguish between folks reducing their driving habits purely because the price went up, over their decision to do so because of the dependence on foreign oil. He recognized that countries are now jockeying for guaranteed access to the increasingly limited supply, and this dependency is a “very scary proposition” particularly if it starts to define our geopolitical stance. He did suggest that people conserve in personal travel by driving more fuel efficient cars and car pooling, but when challenged as to whether folks would, he merely hoped so. And then he spoke up for the use of bio-waste as well as specifically grown crops to generate bio-energy.

In looking at the benchmark of 100-day accomplishments he is proud of getting the loan guarantee program to actually start making loans, whereas when he came in the likely start date had been projected as sometime next year.

For climate change, and carbon reduction he still holds to the target of reducing carbon emissions by 80% by 2050. He still sees energy conservation, in things like buildings, as the lowest hanging fruit. He thinks we can reduce building energy costs by 80%, with today’s technologies and without solar panels. He feels that the Department can design tools that will help people do this., and that the added investments to make them efficient will then pay for themselves in 10-years or less.

But as with cars, and the change to higher mileage vehicles with improved batteries, there is no recognition that this problem needs an immediate solution. Rather the Department is going to continue developing battery technology, with the hope that in time the cost differential for a hybrid will be small enough that it will become more attractive to the public. As it will continue to work on the design tools for buildings, but there is no sense of emergency in the talk, no sense that the time where we will need to have answers is in the relatively immediate future. Interestingly when he was selling the concepts of hybrids he argued that they were only $5,000 more expensive than conventional models, and yet when arguing the need for research on batteries he put the price of current batteries in hydrids as being on the order of $10,000. (Tsk!) But new batteries are at least 5 years away.

I must confess that I do find it a little odd that he would have us concerned over climate change, with a potential for that impact being towards the back end of this century, with much less concern over the more imminent arrival of fossil fuel shortages, which may well occur within the period of the current Administration.

And in that regard he talked of the differences between regulatory and legislative paths towards reducing carbon emissions. He anticipates that the EPA will move on the regulatory process, which may, in turn stimulate more legislative activity. And looking further into coal, the rate of advance of “clean”coal’ is going to depend on the costs and the technologies that show that they can work. These are pilot demonstration plans going forward that will initially be expensive, but will come down with use. And he thinks that as a result clean coal could happen. He thinks that the economic and social consequences of continuing to burn coal are becoming more evident and more pressing. (One wonders what he is thinking of in particular) But again this is quite generalized, and not focusing on the shorter term path forward, and, as I keep listening to the Secretary the more I worry that he does not see the time scale over which changes need to be made.
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