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By Robert Rapier on Sep 2, 2011 with 111 responses

Reality Settling in at the White House

Hug the Green Industry, Kill Big Oil

When Barack Obama was campaigning for president, I thought he displayed a “comic book” view of the energy industry: Lots of stereotypes of the good guys and the bad guys.

He would support the good guys (those who aspired to produce renewable power) and deal with the bad guys (those who were actually supplying the fuel that allowed him to campaign across the country). If he was elected president, there would be green jobs galore, and we would embark upon a major transition away from fossil fuels. He seemed to believe that our high level of dependence on fossil fuels was more due to policy reasons than economic reasons, and the country needed a strong leader who could come in and put fossil fuels behind us.

Three years into his administration, there are signs that reality is beginning to settle in at the White House.

I often write about the money that has been wasted as the government has attempted to choose technology winners. The most recent high profile case was a company called Solyndra. President Obama visited this solar power company in 2010 and said “The true engine of economic growth will always be companies like Solyndra.” The company received a $535 million loan guarantee from the Department of Energy, and critics are now pointing out that the company has political ties to the White House and that the loan guarantee was fast-tracked without a proper level of due diligence. Now, only a year after the President’s visit, the company has declared bankruptcy and taxpayers will almost certainly be on the hook for paying off that loan. It is starting to look like our energy problems won’t be solved by just spreading money around to create this new green economy.

The Folly of Government Picking Winners

This is a perfect example of why I would change the way we incentivize renewable energy. We have numerous cases of the government attempting to pick a technology winner, throwing money at it, and then leaving taxpayers with the bills after the company fails to deliver. The government has a role to play here, but that role should not be to funnel money preferentially to specific companies.

Let’s first define what we are trying to accomplish. I am sure most people believe that there is value in reducing our dependence on fossil fuels — particularly imported fossil fuels — so most are probably willing to provide some level of government support to do so. But the current system often rewards companies before they deliver anything. We have to stop that. We need to place the prize at the end, not at the beginning. We need to reward companies that deliver, not those that promise to deliver. In many cases, companies simply squander this “free money” in ways that should not be tolerated. What we need to do is level the playing field for all companies and allow them to compete. Those that ultimately deliver will be the ones who collect the prize. That is the way business is supposed to work. That is the way great companies are built.

We could have a system similar to my recently suggested overhaul of the cellulosic ethanol incentive system. Offer subsidies for production, and let the companies compete for private funding, and collect the subsidies after they deliver. In this way, the best ideas will have the greatest chance to rise to the top. Our current system rewards those who are politically connected or who are good at hyping their technologies. We presently have too much money flowing to poorly managed but politically connected companies.

When Reality Hits Home

Of course as this new reality sets in at the White House, we find the Obama Administration angering a lot of their supporters by conceding to the realities of our oil consumption. In a recent interview, Energy Secretary Chu signaled that the administration was ready to support the controversial Keystone XL pipeline that would bring crude oil from the Canadian oil sands to Gulf Coast refineries. There have been a number of high-profile arrests at the White House as opponents of the pipeline believe it will simply continue to feed our addiction to oil that Obama promised to stop. In the interview, Chu laid out the reasoning for the Administration’s support of the pipeline:

“Having Canada as a supplier for our oil is much more comforting than having other countries supply our oil,” Chu said.

Chu noted that “the technologies that are used to extract tar sands oil . . . are improving dramatically.”

“The companies that are extracting these tar sands are making great strides in improving the environmental impact of the extraction of this oil and will continue to do so,” Chu added.

But the energy secretary also acknowledged that the final decision won’t satisfy everyone:

“In the end, it’s one of those things where it’s not perfect, but it’s a trade off.”

That’s what I always say: All of our energy choices involve trade-offs. Chu is signaling that the Administration is ready to bow to the reality of our oil dependence. After all, Obama must face voters next year, and voters are going to want to know what he has done in the name of energy security. Bear in mind that Secretary Chu believes that climate change is one of the most serious threats to civilization, and yet here he is defending the pipeline. To me that has all the signs of someone who has realized that if we don’t burn that oil, someone else will and we will just buy oil from some other place that is perhaps less politically stable than Canada.

On the topic of the proposed pipeline, Al Gore recently said something that struck me as absolutely bizarre: “Gasoline made from the tar sands gives a Toyota Prius the same impact on climate as a Hummer using gasoline made from oil.”Al Gore, Aug. 31, 2011 These are the sorts of extremist statements that have caused many to tune Al out. The fact is that his comment isn’t remotely grounded in reality. I was about to do the calculation for myself, but as I was searching for the source of the quote I found out that someone has already done it:

A Hummer gets 10 miles per gallon. A Prius gets 50. Gasoline from the oil sands entails roughly 15 percent greater emissions than gasoline made from the average barrel of conventional oil used in the United States. A Hummer using “gasoline made from oil” thus has 4.3 times the impact on climate as a Prius using “gasoline made from the tar sands,” not the same amount. None of these numbers are controversial (well, some in industry would claim that 15 percent is too high). Someone like Gore, who cares passionately about both climate change and scientific seriousness, should not mislead his followers on such a massive difference.

So Al wasn’t even in the ballpark, but that hasn’t stopped many opponents of the pipeline from regurgitating this quote. And this is exactly the sort of misinformation that distorts our energy policies.

In any case, Obama’s energy idealism seems to be giving way to energy pragmatism. I suspect he now realizes that there was more holding back the green economy than a lack of leadership.

  1. By Douglas Hvistendahl on September 5, 2011 at 6:00 am

    There are some things that will pay off now. For some years we’ve been blowing summer air through the basement and into the house. After some years, the soil under the house has warmed to the point where we need to use the air conditioner in August again, although not as much as before. The soil is up another 4 degrees Fahrenheit this year – there is a noticeable improvement (though small) in our heating bills in fall and early winter. We are using the savings from this to put in an attic through soil liquid loop to harvest the attic summer heat.

    Transportation remains a problem. Bicycles for local use, weather permitting, combining needed trips, and a high MPG vehicle are about it at present.

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  2. By Jillian on September 5, 2011 at 7:30 am

    Affordability remains a concern for most of us. I support the idea of subsidizing only green technologies and taxing oil at a higher rate…in theory. But what that does to the price of gasoline and everything associated with it has a tremendous impact on me. I live in rural suburbia, 20 minutes from anything…that’s a lot of miles no matter how you plan your day. And groceries that were $50 last year are $80 today. I’m lucky to be making ends meet with not just one, but two jobs…when one in ten of US have no job at all. And the seniors I work with are struggling terribly. We need to put a halt to all this political infighting and get down to business now. The longer we wait the transition, the more hardships we will endure.

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  3. By rate-crimes on September 5, 2011 at 9:07 am

    “as I was searching for the source of the quote I found out that someone has already done it:” – Robert Rapier

    You  refer to an analysis by “someone” who is Michael Levi described there as the David M. Rubenstein senior fellow for energy and the environment at the Council on Foreign Relations.  Mr. Levi uses numbers provided by IHS CERA – Daniel Yergin’s outfit – in his analysis.

    “So Al wasn’t even in the ballpark” – Robert Rapier

    In what “ballpark” is this game being played?

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  4. By renewableenergy2 on September 5, 2011 at 10:29 am

    Americas financial sustainability begins with Made in America

    Americans must wake up and take action to protect our liberty and way of life.

    America must rejuvenate itself and become the huge industrial power it once was.

    It starts by re-inventing the wheel and building manufacturing facilities in the United States that employ Americans who produce quality goods at a competitive price with space age technology and modernization.

    Organized workforce and benefits has to be revamped to meet today’s economic conditions.

    Government and its bureaucracy must be reduced and streamlined. Rules and regulations must be revamped to be conducive to business growth and development.
    This is a must in order to increase employment and bring back America’s economic vitality.
    We could try to give tax incentives for products made in America. It brings revenues and employment, reduces financial drain on the government.

    “It is cheaper to save energy than make energy”

    YJ Draiman for Mayor of Los Angeles

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  5. By renewableenergy2 on September 5, 2011 at 10:37 am

     
    World class renewable energy innovation enterprise zone revealed for Los Angeles – Proposed by YJ Draiman – rev.2

     

    YJ Draiman welcomes an innovative renewable energy zone approach which will create 200,000+ new jobs over the next 5-10 years.

     

    An ambitious project that will transform the way universities, business and industry collaborate, and establish Los Angeles as a world leader in the research, development and design of next generation renewable energy technology, was announced today, January 31, 2011.  Spearheaded by the Draiman economic development agency, Draiman Enterprise, and National Technology Renewable Energy Zone, will be established in the city of Los Angeles with the Universities of Southern California Technology Innovation Development at its heart.

     

    A large parcel of land will be allocated to set up the renewable energy enterprise zone site, which will be within the boundaries of Los Angeles.  There will be an academic center which will be transformed into a center of excellence for academic research, commercialization and industry collaboration.

     

    The renewable energy zone initiative, which would span further than the confines of the City of Los Angeles and include Southern California, is expected to create 200,000 + new jobs over the next 5-10 years and give a boost to the Los Angeles economy through further industry academia collaboration and inward investment.

     

    Draiman enterprise Chief Executive YJ Draiman said:  “This new vision of the Renewable energy Technology Innovation Center will be the cornerstone of Los Angeles Technology and Renewable Energy Zone.  YJ Draiman’s vision for The Renewable energy Zone is to provide a breeding ground for ambitious companies to harness cutting-edge research, access the best people and develop the products which will shape the renewable energy industry of tomorrow.

     

    “Southern California has already claimed a place on the renewables map attracting energy heavyweights and pioneers in the solar and wind sector and we believe that by establishing this zone we will help reinforce Los Angeles position as a location of choice for the rapidly expanding renewables industry.”

    YJ Draiman said: “The Universities in the Los Angeles area’s Technology and Innovation Center is a transformational project for Los Angeles, building on California’s great tradition of innovating new technologies and developments in fields; including energy and engineering while creating and supporting hundreds of jobs.  Through this collaboration, the aim is to quadruple the scale of research program investment in Los Angeles in areas key to economic growth by up to $10 billion + in five-ten years.  “And now, as an integral part of Los Angeles Enterprise’s new Technology and Renewable Energy Zone, which aims to establish Los Angeles as a premier location for inward investment into world-leading technology and renewables research and development, we have the potential to deliver huge economic and social benefits, not only in Los Angeles but nationally and beyond.”

    YJ Draiman said:  “The Technology and Innovation for renewable energy zone will help transform Los Angeles and Southern California.  By capitalizing on our leading, industry-relevant research, the renewable energy zone will attract billions of dollars of inward investment to the city of Los Angeles, drive global businesses, create jobs, and support the development of our highly-qualified graduates and postgraduates.  “As a leading technological hub of Universities, they are committed to sharing knowledge to address challenges that affect every area of society, including energy, health, manufacturing and economics.  The renewable energy zone will forge new levels of collaboration between researchers, the public and private sectors to accelerate the pace of research and development and deliver benefit to companies, the economy and Southern California.”  The collaborative approach with the Universities, Los Angeles Enterprise and existing pioneering renewable energy leaders means that companies locating in the zone will have access to government support and some of the world’s best industry and academia in the fields of technology, engineering and energy.  The project represents a supportive government and business environment where companies locating in and around the zone may be eligible for additional support for job creation, innovation and staff development, delivered through various California Enterprise schemes.

    When the need arises we will establish facilities within the existing Zone that offer temporary accommodation for prospective tenants until construction of the research center is complete or, if required, a purpose-built industry engagement building is created within the Zone.

    Renewable energy Zone is designed to draw on Southern California’s existing competitive advantage by providing the right business environment for the renewables industry to continue to grow and further develop.  Recent announcements from industry leaders have reinforced Southern California’s position as a world leading city in solar, wind research and development.  A leader in energy innovation with unrivalled human and natural resources in renewable energy, Southern California is building on its rich history of oil and gas exploration and developing an infrastructure to cement its position as a world class location for international companies looking to invest in renewable energy and Energy efficiency.

     

    YJ Draiman for Mayor of Los Angeles 

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  6. By Walt on September 5, 2011 at 11:40 am

    Rate Crimes said:

    “as I was searching for the source of the quote I found out that someone has already done it:” – Robert Rapier

    You  refer to an analysis by “someone” who is Michael Levi described there as the David M. Rubenstein senior fellow for energy and the environment at the Council on Foreign Relations.  Mr. Levi uses numbers provided by IHS CERA – Daniel Yergin’s outfit – in his analysis.


     

    Thanks for the link to the “well-to-wheel” calculations used by IHS energy.  That is the first time I’ve seen those calculations for individual crudes, but I really wonder if all those crudes take into consideration gas flaring or not.

     

    I assume they are all without gas flares per well, but there is a lot of that crude that still flares a lot of gas creating emissions.  The calculation of gas flaring should be considered in the calculations since some fields take many years (sometimes more than 20 years) before they stop flaring gas.

     

    IHS CERA recently published a document on GTL costs and it is seriously in error in my view.  However, it was a very good beginning to a controversial subject that should be done in regard to the “biofuels” movement.  If there was a published study on all of the ethanol and biofuels technologies using the same methodology of IHS CERA on GTL, it would be excellent for investors and government officials.

     

    The claim that producing ethanol for less than $1.00 per gallon at the key time of raising millions and millions of dollars seems unfair to those who recognize some of these technologies after spending $100 to $500 million will not make it until bankruptcy protection.  Bankruptcy protection seems to be the new renewable energy strategy (if an IPO is not possible) to force reorganization by key investors and shareholders to eliminate prior agreements, and renegotiate loan agreements after all the money has been spent.  Anyone speaking out against these new bankruptcy strategies are going to be the focal point of criticism so best to stay silent and watch them unfold.  Bankruptcy is a way to get control of technology and break agreements that protect certain key shareholders.  I would like to see some sort of IHS CERA study on these technologies before the wave of more bankruptcies change the terms of these falty structures.

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  7. By Don Pitts on September 5, 2011 at 11:45 am

    Based on the EROEI shown in Wikipedia, Al Gore is not far off.
    http://en.wikipedia.org/wiki/F….._-_USA.svg

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  8. By rate-crimes on September 5, 2011 at 12:11 pm

    “I really wonder if all those crudes take into consideration gas flaring or not” – Walt

    Excellent point, Walt.  I wonder also if the cost of water resources were incorporated in the calculations.

    “Al Gore is not far off.” – Don Pitts

    It is wise to maintain a healthy skepticism of CERA’s numbers and analyses.

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  9. By Jackie R on September 5, 2011 at 12:38 pm

    I don’t see any mention of all the other costs–building the pipeline, potential leakage scenarios, costs to pump through the line vs. cost to make all buildings more energy efficient and all vehicles as well. Get off the Al Gore fixation both sides and get to work on real comparisons.

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  10. By rate-crimes on September 5, 2011 at 12:54 pm

    “get to work on real comparisons” – Jackie R

    How do we compare this?…

    • 819,000 gallons, Kalamazoo River, July 2010
    • 1,176,000 gallons, Alberta, May 2011
    • 30,000 gallons, Yellowstone River, July 2011
    • 21,000 gallons, Romeoville, IL, September 2011

    Kalamazoo River oil spill puts spotlight on pipeline regulation

    Alberta oil spill firm apologizes

     

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  11. By paul-n on September 5, 2011 at 1:07 pm

    Based on the EROEI shown in Wikipedia, Al Gore is not far off.

    Actually, he is way off.

    That EROEI is for producing oil, you then have to refine it into products, and that changes the picture dramatically.

     

    As a rough guide, it takjes 10% of the oil’s energy to produce AND refine itself, so for every barrel produced you have used 0.1 to get it.

    For the tar sands, it takes about 0.3bbls to produce and refine it, hence the oft quoted remark that it  ”produces three times more CO2 than conventional oil.

     

    But if we wlook at the well- to wheels for theend user, using one bbl of products from conventinal oil has consumed 1.1 total, and one bbl from oil sands oil has consumed 1.3 total, or an 18% increase.

    Gore and company always ignore that the biggest CO2 emitter, by far, is not the oil producer, but the oil consumer.

     

    So the Prius doing 50mpg on oil sands oil is actuall getting 50 per 1.3, or 38.5mpg, and the Hummer getting 11mpg on conventional is actualluy getting 10mpg.

    The production/refining energy for the tarsands Prius is 0.3/50=0.006 gal/mile, and for the Hummer it is 0.1/10 = 0.01, so in that sense they are close, but how meaningful is it to ignore the end use of said energy?

     

    A nation of oilsands consuming Prius drivers (e.g. Canada) is much more energy secure  than a nation of conventional-oil  consuming Hummer drivers – that would be the US!

     

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  12. By paul-n on September 5, 2011 at 1:07 pm

    How do we compare this?…

    Yes, let’s compare pipelines.  All this hand wringing over the Keystone XL, you could be forgivenm for thinking that this was the first ever pipeline proposed to be built in the US.

    Really, what difference does one more make when you look at what is there already?

     

     

    To nix this pipeline and keep importing more mid east and Venez oil is plain silly.  

    But, the decision could be taken out of the US hands, as Canada gears up to build two new pipelines to the west coast, and export the oil to China instead. 

    Right now the price spread between WTI and Brent or Tapis (Singapore) crude is about $25/bbl, so Canada is losing about $50m/day, or $18bn per year, selling to the US instead of China.  We like you guys, and are happy to beat you in hockey whenever you want, be we aren;t into giving stuff away.  The oil business is all about the money, after all.

     

     

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  13. By rate-crimes on September 5, 2011 at 1:33 pm

    “how meaningful is it to ignore the end use of said energy?” – Paul N

    then, in the very next paragraph (!) . . .

    “A nation of oilsands consuming Prius drivers (e.g. Canada) is much more energy secure  than a nation of conventional-oil  consuming Hummer drivers – that would be the US!” – Paul N

    Your assumption that fungible petroleum will remain within any border borders on the ridiculous.

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  14. By rate-crimes on September 5, 2011 at 1:36 pm

    “To nix this pipeline and keep importing more mid east and Venez oil is plain silly.” - Paul N

    To imagine that this pipeline will do anything to prevent the importation of more oil from the Middle East, Venezuela, and other distant lands is . . . “plain silly”.

     

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  15. By rate-crimes on September 5, 2011 at 1:43 pm

    “ We like you guys” – Paul N

    We’re not your ‘guys’, buddy.

    Canadian

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  16. By rrapier on September 5, 2011 at 2:34 pm

    Jillian said:

    Affordability remains a concern for most of us. I support the idea of subsidizing only green technologies and taxing oil at a higher rate…in theory. But what that does to the price of gasoline and everything associated with it has a tremendous impact on me. I live in rural suburbia, 20 minutes from anything…that’s a lot of miles no matter how you plan your day. And groceries that were $50 last year are $80 today. I’m lucky to be making ends meet with not just one, but two jobs…when one in ten of US have no job at all. And the seniors I work with are struggling terribly. We need to put a halt to all this political infighting and get down to business now. The longer we wait the transition, the more hardships we will endure.


     

    And that, in a nutshell, describes why we are dependent upon oil and coal. It isn’t a criticism directed at you, it is just a fact of life that fossil fuels — despite the fact that they are unsustainable and often come from unstable parts of the world — are simply the cheapest alternatives in terms of the retail price you pay. And as long as that is the case, there will be tremendous resistance to change.

    RR

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  17. By rrapier on September 5, 2011 at 2:39 pm

    Rate Crimes said:

    “as I was searching for the source of the quote I found out that someone has already done it:” – Robert Rapier

    You  refer to an analysis by “someone” who is Michael Levi described there as the David M. Rubenstein senior fellow for energy and the environment at the Council on Foreign Relations.  Mr. Levi uses numbers provided by IHS CERA – Daniel Yergin’s outfit – in his analysis.


     

    I have the same sorts of number for the EROEI of tar sands from multiple locations. For example: http://www.consumerenergyrepor…..tar-sands/ Plug those numbers in and you still fall far short of Gore’s claim.

    “So Al wasn’t even in the ballpark” – Robert Rapier

    In what “ballpark” is this game being played?

    The ballpark where we use fact and not hyperbole to make our arguments.

    RR

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  18. By rrapier on September 5, 2011 at 2:43 pm

    Jackie R said:

    I don’t see any mention of all the other costs–building the pipeline, potential leakage scenarios, costs to pump through the line vs. cost to make all buildings more energy efficient and all vehicles as well.


     

    The costs are economic decisions that Keystone has to deal with. Potential leakages are an ever present danger with almost any sort of energy system. You have to ask yourself what the trade-off is for realistic alternatives. If Keystone doesn’t build the pipeline, are they going to spend the money on making buildings more efficient? No.

    Get off the Al Gore fixation both sides and get to work on real comparisons.

    No Al Gore fixation here. He said something relevant to the debate, and not remotely factual. We try to correct misinformation here. Therefore, it was mentioned, but wasn’t the basis of the article.

    RR

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  19. By Marcel F. Williams on September 5, 2011 at 3:45 pm

    The best ways to create wealth and jobs and energy independence in America is to begin the gradual transition from a fossil fuel economy to a nuclear and renewable energy economy. We already know how to make gasoline, diesel fuel, and jet fuel from carbon neutral resources. And we already know how to produce electricity from carbon neutral resources. So its time to get on with the transition!

    The simplest way to do this is for Federal and State governments to mandate that a gradually growing percentage of electricity in this country and transportation fuel in this country should come from carbon neutral resources– with the penalty of heavy carbon taxes on those companies that fail to reach those percentile mandates.

    So if the Federal government mandates that at least 50% of all electricity produced by a utility should be produced through carbon neutral technologies by 2020 and 90% by 2030, utilities will have no choice but to start investing and building nuclear power plants and renewable energy facilities and possibly even coal and natural gas power pants equipped with carbon capture and carbon storage capacity. Several utilities in the US with large nuclear or hydroelectric capacity already meet the 2020 goal.

    If the Federal government mandated that at least 10% of all gasoline, methanol, diesel fuel, and jet fuel used for transportation in America must come from carbon neutral resources by 2020, 50% by 2030, and 90% by 2040 then energy companies would have no choice but to begin investing in the production of such fuels from urban and rural biowaste and even from nuclear and hydroelectric resources using hydrogen synthesized with carbon from biowaste or extracted from the atmosphere.

    Such mandates would clearly tell the energy companies the direction that they have to go in order to sell their products in the US without the penalty of heavy carbon taxes. But private companies and the market place will decide which of those technologies are the most viable and appropriate for them to gradually reach those Federally mandated requirements.

    The Federal government wouldn’t have to spend a dime to get this done and companies could avoid paying heavy sin taxes on carbon as long as they meet the Federal mandates.

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  20. By mac on September 5, 2011 at 4:18 pm

    RR said,
    “And that, in a nutshell, describes why we are dependent upon oil and coal. It isn’t a criticism directed at you, it is just a fact of life that fossil fuels — despite the fact that they are unsustainable and often come from unstable parts of the world — are simply the cheapest alternatives in terms of the retail price you pay. And as long as that is the case, there will be tremendous resistance to change.”
    ———————————————————————————————–
    Well said,

    But let me ask you this…….When was the last time your stock broker advised you to put all your eggs into one basket (one stock) ???

    I always thought good stock market advice dictated that we invest in a variety of stocks, (a diversified portfolio), to minimize risk.

    But sure enough, the good old U.S.A. has decided to hang its hat on just one energy source….OIL.

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  21. By Benny BND Cole on September 5, 2011 at 5:07 pm

    Excellent commentary by RR, who should be Energy Secy if not President.

    We may wish to tax imported oil (although trade agreements male that tricky) or tax fossil-fuel gasoline at the pump (my favorite), but picking winners is a waste of taxpayer money.

    If we would commit to a $2 a gallon federal gasoline tax, gradually levied (25 cent up every three months), we would solve a lot of problems.

    Lots of ways to go on this. CNG, methanol, ethanol, PHEVs.

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  22. By Techno on September 5, 2011 at 5:11 pm

    Obama may have promised to embrace green energy, however……….big oil may have had other plans, you know.
    We all know also that China, India with it’s air car, Europe, they ARE helping themselves with solar panels, etc.
    We are still waiting for a miracle, and now we are blocking the pipeline fron Canada, that will only keep us buying oil from America haters.

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  23. By rrapier on September 5, 2011 at 11:47 am

    Techno said:

    We all know also that China, India with it’s air car, Europe, they ARE helping themselves with solar panels, etc.


     

    Yes, but China and India are also rapidly increasing their consumption of coal and oil. They aspire to higher standards of living, and there simply isn’t oil to go around. So they are going to drive prices sky high. At the same time, they will have no choice but to develop every alternative possible to add to their energy mix.

    RR

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  24. By rate-crimes on September 5, 2011 at 7:17 pm

    “The ballpark where we use fact and not hyperbole to make our arguments.” – Robert Rapier

    Robert, you stated, “So Al wasn’t even in the ballpark”, based on questionable figures from questionable sources, based on incomplete analyses. 

    “These are the sorts of extremist statements that have caused many to tune Al out.” – Robert Rapier

    The statement, “Gasoline made from the tar sands gives a Toyota Prius the same impact on climate as a Hummer using gasoline made from oil.”Al Gore, Aug. 31, 2011 may have a valid purpose, even if it can be proven to be hyperbolic.  That is a difficult proof to deliver when the topic is “impact”.  The evidence that you provide as a counter is not only questionable, it is a simplified analysis based only on fuel consumption.  The issues of the embedded energy and the complexity of the automobile systems; and the issue of externalities are not addressed.

    It is improper to label such statements as being “extremist”.  Such language is reactionary and inflamatory, and exacerbates extremism.

     

     

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  25. By rate-crimes on September 5, 2011 at 7:23 pm

    “We are still waiting for a miracle, and now we are blocking the pipeline fron Canada, that will only keep us buying oil from America haters.” – Techno

    What evidence can you provide to prove your assertion that the oil from this pipeline will decrease the amount of oil that the U.S. will purchase from other sources?

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  26. By Wendell Mercantile on September 5, 2011 at 9:06 pm

    I live in rural suburbia, 20 minutes from anything…that’s a lot of miles no matter how you plan your day.

    Jillian~

    You and others who live miles from anywhere, will eventually have to realize that is a great luxury you may not be able to afford.

    When I last moved 17 years ago, I deliberately picked a location from where — if need be — I can walk everywhere I need to go.

    If the Federal government mandated that at least 10% of all gasoline, methanol, diesel fuel, and jet fuel used for transportation in America must come from carbon neutral resources by 2020, 50% by 2030, and 90% by 2040 then energy companies…

    Marcel~

    The government could also mandate we transition to fusion power by 2040. But that doesn’t mean it would happen. Just because government can mandate something, doesn’t mean it’s possible.

    Man made laws can’t repeal the natural laws of physics, chemistry, economics, and thermodynamics.

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  27. By rrapier on September 5, 2011 at 9:19 pm

    Rate Crimes said:

    “The ballpark where we use fact and not hyperbole to make our arguments.” – Robert Rapier

    Robert, you stated, “So Al wasn’t even in the ballpark”, based on questionable figures from questionable sources, based on incomplete analyses. 


     

    But as I linked, I had done the energy return of tar sands myself. So I knew he was wrong. I didn’t decide he was wrong after seeing that other calculations.

    The evidence that you provide as a counter is not only questionable, it is a simplified analysis based only on fuel consumption. 

    Again, I have done the calculations myself. My comment wasn’t based merely on the other guy’s calculation. I knew it was wrong, and I only stumbled across his calculation when trying to confirm that Gore actually said this.

    The issues of the embedded energy and the complexity of the automobile systems; and the issue of externalities are not addressed.

    He isn’t talking about externalties. If he says “We shouldn’t build the pipeline because it will exacerbate climate change” that’s one thing. Instead he made a factually incorrect and easily refutable statement.

    If you wish to defend what Al said, perhaps you could show us a calculation that puts his comment in the ballpark? Until then — and based on what I already knew from doing the calculations previously — I stand by my comment: It is not in the ballpark.

    It is improper to label such statements as being “extremist”.  Such language is reactionary and inflamatory, and exacerbates extremism.

    Extremism is relative to where you are standing. But when Gore resorts to hyperbole that is easily shot down, he does his supporters no favors. He may embolden them, but he also hardens the opposition who see him as a serial exaggerator not to be taken seriously.

    RR

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  28. By rate-crimes on September 5, 2011 at 9:43 pm

    “he also hardens the opposition who see him as a serial exaggerator not to be taken seriously.” – Robert Rapier

    The “opposition” was long ago fossilized.

    “when Gore resorts to hyperbole that is easily shot down” – Robert Rapier

     

    “he made a factually incorrect and easily refutable statement.” – Robert Rapier

    It is impossible to ‘shoot down’ a statement about “impact”.  His statement may be hyperbolic, but it is not “factually incorrect”.  It seems that you are trying to reduce his statement to an engineering problem.  Several other points are more salient:  For example, the greatest impact on climate may simply be the burning of these additional carbon fuels.  Gore may have been trying to explain that no matter in what engine we burn these carbon compounds, they’re still going to be a problem.

    Why should we care much about the parsing and interpretation of Al Gore’s words when doing so only distracts us from far more critical issues?  Should we not instead have our focus on preventing these carbon molecules from getting to any market?

    Slow the flow.

    [link]      
  29. By Wendell Mercantile on September 5, 2011 at 10:43 pm

    Gore may have been trying to explain that no matter in what engine we burn these carbon compounds, they’re still going to be a problem.

    Rate Crimes,

    No matter what we or Al Gore do there is going to be a problem. How are you going to tell 1.3 billion Chinese and one billion Indians they can’t aspire to drive Buicks, Toyota, and Volkswagens and move into the middle-class they see everyday through myriad forms of media?

    If the 312 million people in the U.S. tomorrow rejected their cars, started riding bicycles, turned off their air conditioners, and stopped eating strawberries and grapes flown in from Chile, it wouldn’t make one whit of difference in the trajectory of where the world is headed. It would just mean China and India would burn larger shares of the earth’s remaining fossil fuels.

    [link]      
  30. By Rufus on September 6, 2011 at 12:25 am

    Wait; I thought we were against pipelines. We were when Poet wanted to build theirs, right?

    I’m so confused.

    [link]      
  31. By rate-crimes on September 6, 2011 at 12:26 am

    Wendell, your cynical prediction has the tinge of inevitability.  How does this tragedy bear on the question of whether a pipeline should be built to transport Athabasca tar sands oil across the length of the Ogallala aquifer?

    [link]      
  32. By rrapier on September 6, 2011 at 1:16 am

    Rufus said:

    Wait; I thought we were against pipelines. We were when Poet wanted to build theirs, right?

    I’m so confused.


     

    Rufus,

    Not confusing. First, I am not arguing for or against the pipeline. But the difference is that Canada has excess energy to export. The Midwest is already a net importer of energy, so it doesn’t make sense to import oil and export ethanol. See? Not confusing at all.

    RR

    [link]      
  33. By Troy on September 6, 2011 at 1:19 am

    Great and timely post, Robert, but what are the methods for “leveling the playing field for all companies”? I liked your critique of our biofuels policies and “placing rewards at the end”, but that’s leveling the playing field among companies in the same industry. What about leveling the field for cleantech industries with that of entrenched fossil energy industries?

    Picking winners IS a policy that is sure to fail us. But when capital would much rather enjoy returns from a booming natural gas industry or your mentioned new oil pipeline from Canadian tar sands, how do we make sure much of that capital is steered, instead, into investments in cleantech? The abstract and non-monetized costs (e.g. future air quality and climate change, environmental degradation, wars that will be fought to secure future oil supplies, future recessions caused by fossil fuel supply constraints, future rolling blackouts on the grid when fossil generation can’t meet load) are not reflected in what we currently pay at the pump or for natural gas-powered electricity. My point is that THIS is the field that needs leveling – cleantech vs. old-tech. And while I’m opposed to picking winners, I struggle to see how this field can be leveled without doing just that. So I genuinely ask you – how do we structure such programs without creating another Solyndra?

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  34. By rate-crimes on September 6, 2011 at 1:40 am

    “My point is that THIS is the field that needs leveling – cleantech vs. old-tech. And while I’m opposed to picking winners, I struggle to see how this field can be leveled without doing just that.” – Troy

    Is there even a consensus on the definition of “cleantech”, or “old-tech”?  Even if a consensus could be reached on these terms, what about a consensus on other dimensions such as regional, local, central, and distributed generation?  What about storage and transmission?

    Today, there is no consensus.  Certainly, then, there can be no coherent vision.  What then do we “level”?  All we have remaining is Wendell’s Asian frenzy, a spaghetti plate of pipelines, and complex systems merged with tsunamis; with the inevitable consequences.

    And we talk of “picking winners”?!  Hah!

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  35. By paul-n on September 6, 2011 at 2:55 am

    Rate Crimes wrote;

     

    Why should we care much about the parsing and interpretation of Al Gore’s words when doing so only distracts us from far more critical issues?

    For once, we are in agreement!

    Let none of us here ever again worry ourselves about what Al Gore says.

     

    Troy wrote;

    how do we make sure much of that capital is steered, instead, into investments in cleantech?

    Here’s one suggestion – investments in “cleantech” – which will need to have a goverment definition – can be written off 100%, immediately, instead of being depreciated like capital investments normally are.  That wouldn’t necessarily create a flood of capital for cleantech investments but it might tip a few more decisions in it’s favour.

    Would be a good way for the US to get some investment from overseas, or at least stop/slow investment from domestic companies going overseas.

    [link]      
  36. By rrapier on September 6, 2011 at 4:10 am

    Troy said:

    Great and timely post, Robert, but what are the methods for “leveling the playing field for all companies”? I liked your critique of our biofuels policies and “placing rewards at the end”, but that’s leveling the playing field among companies in the same industry. What about leveling the field for cleantech industries with that of entrenched fossil energy industries?


     

    Well, what I proposed for biofuels would work just fine to level the playing field. If a $2/gallon subsidy doesn’t level the playing field, I don’t know what will. You could structure something similar for the power industry.

    RR

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  37. By Frank Weigert on September 6, 2011 at 7:29 am

    “Let’s first define what we are trying to accomplish. I am sure most people believe that there is value in reducing our dependence on fossil fuels — particularly imported fossil fuels — so most are probably willing to provide some level of government support to do so. But the current system often rewards companies before they deliver anything. We have to stop that. We need to place the prize at the end, not at the beginning.”

    That’s one way to frame the issue. Another is to say that what the government is paying for research that private industry won’t do because the time horizon is too long for the ultra-short-term thinking that now dominates Wall Street. I believe that the government should sponsor more long-range research and less short-term development.

    Free market extremists love prizes. They induce an orgy of spending by individuals, most of whom will earn no return. The one winner profits handsomely. Developing a rocket to replace the shuttle is following this model. It doesn’t always work. Specifically, it won’t work if the new kid on the block has to displace an existing business. The shuttle is history. The oil business is not.

    “To me that has all the signs of someone who has realized that if we don’t burn that oil, someone else will and we will just buy oil from some other place that is perhaps less politically stable than Canada.”

    You aren’t factoring in the environmental damage shale oil development will bring. Canada may not have enough water to process all of this gunk.

    The real problem is how society values the fuel business. The oil companies do not make much money pumping gasoline into your car. They do not make much money transporting the liquid to your filling station or refining petroleum into transportation fuels or even transporting crude oil from the Middle East to America.

    They make their biggest profits gambling. They buy a lease to drill in the Gulf of Mexico, [or in the Everglades :-) ] for a low price and hope to find enough oil to earn enough to pay for the inevitable dry holes. They are getting better at this prediction game and their long-shots are paying off more often than not. This is the source of those out-size profits the Liberals are complaining about. The government is undervaluing the people’s assets and giving them away to cheaply to the oil companies.

    Anything that stabilizes the cost of obtaining fuel precursors destroys this business model, and industry never likes that. Shale oil is business as usual. The industry can live with that. Biofuels are not. The oil companies go into full tobacco company mode to preserve their existing business model. Emerging businesses have no chance against the entrenched majors.

    But you are right. There are a lot of ideas that should never have been funded. All too often politics trumps science.

    [link]      
  38. By Wendell Mercantile on September 6, 2011 at 10:04 am

    …whether a pipeline should be built to transport Athabasca tar sands oil across the length of the Ogallala aquifer?

    Rate Crimes,

    The energy is there in the tar sands. Someone is going to extract the oil from that sand and use it. Would you rather ship it across the Pacific to Japan, China, and India, or send it through a pipe to the US?

    At least we wouldn’t have to worry about the effects of a tsunami going across the Dakotas, Nebraska, and Kansas.

    As to the Ogallala Aquifer: Better a 36″ or 48″ diameter pipe crossing the Ogallala than permanently emptying it to water golf courses and grow corn for ethanol — which is what we are doing now.

    [link]      
  39. By Wendell Mercantile on September 6, 2011 at 11:35 am

    …your cynical prediction has the tinge of inevitability.

    Rate Crimes,

    Why do you say cynical? I’d say realistic. Ford just announced they will build an auto plant in India to make 240,000 cars a year. As far as I can tell, they will all burn gasoline or diesel fuel, and Indians will be driving the majority of them. They will have to get that fuel from somewhere. If we don’t want a pipeline to bring that Alberta oil to us, I’m sure they will be happy to build a pipeline to Vancouver, and ship it to India.

    Ford building $1bn manufacturing complex in India

    The new manufacturing facilities in Sanand in the western state of Gujarat will create 5,000 jobs, and will be able initially to produce 240,000 vehicles and 270,000 engines a year, Ford said.

    The complex highlights the automaker’s plan “to aggressively grow the Ford brand in India,” said Ford India president Michael Boneham.

    [link]      
  40. By jason@ solar panels on September 6, 2011 at 12:30 pm

    The problem comes now for a few reasons:
    1) The House of Representatives
    2) The cuts that have been made in social work
    3) The Tea Party
    4) Re-election support required.
    As much as President Obama wants to, he cant risk losing the support of oil people, so I’m going to guess at a postponement until after the next election.
    Mind you, if the Republicans get in, it’ll be cancelled rather than just delayed.

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  41. By paul-n on September 6, 2011 at 12:52 pm

    Frank Wiegert wrote:

    “To me that has all the signs of someone who has realized that if we don’t burn that oil, someone else will and we will just buy oil from some other place that is perhaps less politically stable than Canada.” 

    You aren’t factoring in the environmental damage shale oil development will bring. Canada may not have enough water to process all of this gunk.

    Let’s get these facts straight first.  Oil shale refers to the kerogen deposits in Wyoming, Colorado and Utah, which have to be mined and thermally treated to make oil.  An yes, those states do not really have enough water to do that.

    Now, in Canada we have the oil sands, which are not “oil shale”.  As to is there enough water, have you ever been to northern Canada, or anywhere else in Canada?  It is a pretty wet place – except in winter when it’s cold and frozen, but the water is still there.  Currently, all the oil sands operations use less than 2% of the average flow of the Athbasca River, which runs through the oil sands area.

    It alaways amazes me that some Americans get so bent out of shape about this, while Los Angeles has dried up whole rivers and lakes to feed its egregious water demand – much of which goes to water its lawns and golf courses.

    The oil sands are has no shortage of water, and the envirnmental damage of taking oil saturated land and making it less oil saturated is, well, minimal, really.   The environmental damage of the cities powered by oil is the real issue – and one that many refuse to face up to.

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  42. By Brad Blake on September 6, 2011 at 5:22 pm

    Here’s a novel idea: at the time we have a burgeoning $14.5 trillion National Debt. I say we end every subsidy, every tax break, every mandate and get the government out of setting energy policy that uses taxpayer dollars to either enrich already profitable companies or to prop up technology that doesn’t work. If we did that, the market would disctate. There wouldn’t be troublesome, heavily subsidized and mandated ethanol and there wouldn’t be a solar array or sprawling industrial wind project built anywhere. We would end up with energy dense sources and innovation in response to the market place, not the government picking winners and losers.

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  43. By takchess on September 6, 2011 at 1:16 pm

    http://www.exxonmobilperspecti…..l-economy/

    I like that this is published under their banner and not an psuedo-commenter on a blog. ….
    and yes there is still room for Electric Cars……

    Jim Takchess

    [link]      
  44. By rrapier on September 6, 2011 at 1:23 pm

    Frank Weigert said:

    Free market extremists love prizes. They induce an orgy of spending by individuals, most of whom will earn no return. The one winner profits handsomely. Developing a rocket to replace the shuttle is following this model. It doesn’t always work. Specifically, it won’t work if the new kid on the block has to displace an existing business. The shuttle is history. The oil business is not.


     

    Frank, I usually agree with your comments, but here I don’t on multiple counts. First, you aren’t going to displace the oil business. Right now they already buy most of the oil they refine. You are going to give them some financial incentive to buy their energy domestically by allowing those domestic renewable energy producers to sell their fuel for cheaper than what the oil companies buy now. But the other thing is that “oil companies” won’t always be oil companies. As oil becomes uncompetitive, they will follow in the footsteps of Valero who saw that it was in their best interest to buy up ethanol plants. (Over the past decade, many oil companies have gotten heavily involved in natural gas; in the future as the economics dicstate they will do the same with biofuels).

    The oil companies aren’t going to sit around twiddling their thumbs while someone displaces them. They don’t do that now. They are collectively spending a lot of money researching next generation fuels. And importantly, I will note that there is nothing at all to prevent them from developing those next generation fuels and collecting those subsidies themselves. Some would scream at that notion, but my interest here is in displacing oil, not on who wins the prize.

    You aren’t factoring in the environmental damage shale oil development
    will bring. Canada may not have enough water to process all of this
    gunk.

    You confuse making an observation with advocacy. I am not failing to factor in anything. I am making an observation based on the actions of the White House. If I say that I see us burning through all of the fossil fuels we can, that doesn’t mean I am saying we should. It just means I think that’s what will happen. And the issue of Canada and water — Canada will figure that out for themselves. Our calculations aren’t going to convince Canada to stop developing tar sands because we don’t believe there is enough water. They obviously believe there is or they wouldn’t be going down this pathway.

    Anything that stabilizes the cost of obtaining fuel precursors destroys this business model, and industry never likes that.

    I can assure you that most oil companies do not like the volative nature of the oil business. In recent years, it has benefitted them, but in other years, plenty have been bankrupted by it. They are already valued at very low PEs. Why don’t you think they would be happy to sell fuel at stable prices? And if they aren’t interested in this business model, how do you explain Valero’s dive into the ethanol business?

    In fact, they are going to do what is in their best interests. But “they” don’t make collective decisions. Some will go one direction, and some will go another.

    RR

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  45. By Benny BND Cole on September 6, 2011 at 5:37 pm

    “Global production of biofuels increased 17% in 2010 to reach an all-time high of 105 billion liters (28 billion gallons US), up from 90 billion liters (24 billion gallons US) in 2009. High oil prices, a global economic rebound, and new laws and mandates in Argentina, Brazil, Canada, China, and the United States, among other countries, are all factors behind the surge in production, according to research conducted by the Worldwatch Institute’s Climate and Energy Program for the website Vital Signs Online.

    Biofuels provided 2.7% of all global fuel for road transportation—an increase from 2% in 2009, according to the report. The two biofuel alternatives to fossil fuels for transportation largely consist of ethanol and biodiesel. The world produced 86 billion liters (23 billion gallons US) of ethanol in 2010, 18% more than in 2009. World biodiesel production rose to 19 billion liters (5 billion gallons US) in 2010, a 12% increase from 2009.”

    At this rate, biofuels will be more than a boutique option.

    And if the price of crude oil is price-inelastic, then biofuels may be paying for themselves by lowering crude demand.

    [link]      
  46. By Rufus on September 6, 2011 at 7:05 pm

    1.5 million bbl/day of ethanol, and .3 million bbl/day of biodiesel.

    That would be roughly equivalent to taking another Libya offline.

    Yeah, I imagine that would raise prices a bit.

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  47. By rrapier on September 6, 2011 at 7:57 pm

    Rufus said:

    1.5 million bbl/day of ethanol, and .3 million bbl/day of biodiesel.

    That would be roughly equivalent to taking another Libya offline.

    Yeah, I imagine that would raise prices a bit.


     

    Of course the flip side would be lower natural gas and corn prices.

    RR

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  48. By mac on September 6, 2011 at 8:12 pm

    I’m sure the oil companies are just thrilled to death with the thought of a nation full of plug-in hybrids running on electricity and ethanol.

    Someone once said: “Well, the oil companies will simply buy up the ethanol plants.” Perhaps so, But the reality is …. that there are hundreds of $ Trillions worth of oil still in the ground, I recently read that there is as much as 100 $ Trillion dollars in the Canadian tar sands alone, Do you really think that the oil companies are going to leave all that money laying on the table to run off and make far less profitable ethanol ? What are they going to do ? Trade in their drilling equipment for columbines ??

    The truth is that they have absolutely no desire to see ANY alternative to oil and will gladly keep selling us ‘smack’ until we OD.

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  49. By rrapier on September 6, 2011 at 8:14 pm

    mac said:

    The truth is that they have absolutely no desire to see ANY alternative to oil and will gladly keep selling us ‘smack’ until we OD.


     

    Then why did Valero buy all of those ethanol plants?

    RR

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  50. By Rufus on September 6, 2011 at 8:24 pm

    1) The law mandated they use the stuff, anyway.

    2) They picked the plants up dirt-cheap, and

    3) They see the handwriting on the wall.

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  51. By rrapier on September 6, 2011 at 8:33 pm

    Rufus said:

    1) The law mandated they use the stuff, anyway.

    2) They picked the plants up dirt-cheap, and

    3) They see the handwriting on the wall.


     

    In other words, they will do what is in their best interest. If that turns out to be ethanol, that’s what they will do. Which is my point.

    RR

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  52. By rate-crimes on September 6, 2011 at 8:51 pm

    “In other words, they will do what is in their best interest.” – Robert Rapier

    Only to the best of their (and our) limited understanding and near (e.g. ‘quarterly’, chauvinistic) horizons.  It’s Easter Island redux.

     

    [link]      
  53. By Rufus on September 6, 2011 at 10:02 pm

    One of the most exciting things I’ve read in awhile is First Solar’s announcement that it now costs them $0.72 to manufacture a Watt of Solar Capacity.

    They predict they will be able to do it for $0.52 in 2014.

    I now believe that we will see a $1.00 Watt Solar Installation in 2015. Combine that with $1.50 Wind, and I feel the ground shifting under our feet.

    [link]      
  54. By rrapier on September 6, 2011 at 10:09 pm

    Rufus said:

    One of the most exciting things I’ve read in awhile is First Solar’s announcement that it now costs them $0.72 to manufacture a Watt of Solar Capacity.


     

    Do they sell their own panels to the public? I wonder how much they are selling their panels for if it costs them that little to manufacture.

    RR

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  55. By Rufus on September 6, 2011 at 10:24 pm

    They’re selling them for a Ton, Robert. But they won’t be able to forever.

    Other Companies are hot on their heels.

    Hell, the guys at MIT printed a solar cell on a sheet of standard paper.

    [link]      
  56. By Rufus on September 6, 2011 at 10:30 pm

    They don’t sell to the public, per se, I think. They do large solar projects right now.

    I think I read that the going rate to the wholesalers/installers, now, is around $1.40 Watt.

    Expected to be in the $1.20 Watt range by Spring.

    I might have posted it on here; another thing that surprised me was to find that the U.S. is, now, a net Exporter of Solar Panels to the rest of the world (including China.)

    [link]      
  57. By Rufus on September 6, 2011 at 10:47 pm

    There are areas of the SW that these panels would have to deliver 2.5 to 3.0KWhr/Yr. You start running the numbers on a $1.50 to $2.00 Watt installation, and the numbers start jumping off the page at you pretty damned quick.

    [link]      
  58. By Rufus on September 6, 2011 at 10:56 pm

    I’m not a 100% Techno/Cornucopian, but on the other hand, it’s stuff like this that make it very hard to be a “Doomer.”

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  59. By Wendell Mercantile on September 6, 2011 at 11:37 pm

    They predict they will be able to do it for $0.52 in 2014.

    Rufus~

    That means we should soon see solar panels at those Tunica casinos, right?

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  60. By Rufus on September 6, 2011 at 11:53 pm

    We can always hope, Wendell; we can always hope.

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  61. By moiety on September 7, 2011 at 5:06 am

    Robert Rapier said:

    Rufus said:

    One of the most exciting things I’ve read in awhile is First Solar’s announcement that it now costs them $0.72 to manufacture a Watt of Solar Capacity.


     

    Do they sell their own panels to the public? I wonder how much they are selling their panels for if it costs them that little to manufacture.

    RR


     

    I would suggest reading this article for a taster.

    http://www.istockanalyst.com/f…..or-updates

    Some interesting stuff

    First Solar spent 37 percent more on Research & Development when

    compared with the first quarter of fiscal year 2010, with the total

    expense being $33.35 million this quarter.

    In the context of a declining market (see below), this large jump is worrying as the company does not seem to have confidence in its baseline (as I read it). One would expect that increased research would not yield something so quickly (6 month time frame) to allow manufacturi9ng costs to decrease.

    Slowing demand due to subsidy cuts is causing an over-supply of solar panels which has forced prices lower this quarter.

    This is the real reason behind the recent drop in manufacturing cost; decrease in demand. However both of these cannot continue indefinately.

     

    [link]      
  62. By russ on September 7, 2011 at 7:53 am

    @ Robert – you certainly upset the greens (loony left) with this post!

    @ Techno – The air car is hot air – nothing more

    Is there any point that Al Gore has made that is even close to the mark? None that I know of. This is kind of like him inventing the internet – just means that was the first time he was aware of the internet.

    @ Rate Crimes – ‘What evidence can you provide to prove your assertion that the oil from this pipeline will decrease the amount of oil that the U.S. will purchase from other sources’. A meaningless point if I ever heard one. In typical extremist fashion, you determine what is against your cause and it automatically becomes extremist. You no doubt do not consider your position extremist but will the majority? Yes.

    The agrument about ‘cleantech or green jobs’ is just political BS. A job is a job and better process that is cleaner will find it’s way to market – impossible to stop such a thing unless one buys into the conspiracy theories.

    We can only hope the cash give away for solar and wind comes to an end in 2013 or sooner – who can afford it? Right now the real winners are the leasing companies that want to place solar on every rooftop while selling electricity to the homeowner at a small discount. I read one post from a guy talking to SunRun in California today – what a deal – a free system on his roof and all he has to do is pay 29.5 cents/kWh with a 2.9% escalator on a long term contract. SunSun takes advantage of the incentives, subsidies and depreciation while selling expensive power to a sucker.

    @ Rufus – You are as far off on solar as you were sometime back when you forgot about the 15% system efficiency so calculated the power generated 6.5 times higher than correct. Panels (thin film) can be bought for under a dollar now. Silicon modules for as low as 1.48$ per watt DC that I looked uo today. Now for the balance of system – If the panels are 50% of the present 5$ per watt installed cost (about right) then the balance is 2.50$ – if the panel cost goes to 10 cents that other 2.50$ stays the same. The 1.50$ wind is another imaginary product? Anyone paying 1.40$ per watt for thin film today is an idiot.

    I read a post a couple of days back that First Solar was offering panels on the retail market. As I am not interested in the thin film I didn’t look to see where.

    [link]      
  63. By Rufus on September 7, 2011 at 8:54 am

    The blue suede boys are making a fortune on the installation, now; but I guarantee you it won’t last. If you can buy a panel for less than a dollar/watt, now, I’ll bet you a dollar to a doughnut I could install a “farm,” inclusive of panels, hardware, invertors, labor, etc,. for real close to $1.75/Watt, and make a small profit.

    I remember just a year, or so, ago, that First Solar said it would soon be able to manufacture a solar panel for $1.00/Watt, and we got the same hoot from the fossil fuel guys that we’re getting now.

    It’s the 21st Century, guys; live with it.

    [link]      
  64. By Rufus on September 7, 2011 at 9:05 am

    Oh, and I never forgot anything about “15% efficiency,” and I was not off by 6.5 times. Just like this time, when I calculate KWh/yr return I’m referring to high quality zones such as S. Cal., Arizona, and Texas. If I’m off 20% in one of these zones, big deal. We’re looking at the movement, and broad scope of history, here.

    The movement in the cost of Renewables is Downward, ( in some cases: Spectacularly Downward,) and the cost of fossil fuels is Upward (again, sometimes, Spectacularly.)

    The only constants? The Sun shines, the winds blow, and weeds grow in a ditch. And, that’s how we’re going to get out of this mess.

    [link]      
  65. By Benny BND Cole on September 7, 2011 at 12:09 pm

    OT to RR: Here is a story out today. I know you are a fan of dimythel (DME)

    “Southern California Gas Co. (SoCalGas) and Oberon Fuels, a San Diego-based low-emission alternative fuels company, announced a joint research and development agreement to design and construct the first commercial facility in the United States to produce Dimethyl Ether (DME) from natural gas for use as a transportation fuel.

    The planned demonstration facility will use Oberon’s proprietary catalytic technology and process which will mix natural gas with carbon dioxide to produce DME in small-scale, skid-mounted modular units that will produce 3,000 to 6,000 gallons of DME per day.”

    WQell, SCG has plenty of natural gas. And natural gas is cheap. They can make DME. It replaces diesel.

    PS I saw a CNG UPS truck yesterday, plying its rounds in Los Angeles.

    [link]      
  66. By mac on September 7, 2011 at 1:26 pm

    Rufus said:

    “I remember just a year, or so, ago, that First Solar said it would soon be able to manufacture a solar panel for $1.00/Watt, and we got the same hoot from the fossil fuel guys that we’re getting now.

    It’s the 21st Century, guys; live with it.”
    ———————————————————————————————
    Oerlikon is the Swiss firm that makes thin film solar. They are now manufacturing at .50 euro cents a watt according to this article posted just 10 hrs ago.

    http://www.energyharvestingjou…..essionid=1

    [link]      
  67. By Rufus on September 7, 2011 at 1:43 pm

    Yeah, that’s right at $0.70/Watt.

    Invertors are coming down. Now, it’s on to “installation.” Give this stew a year to boil, and we’re going to see farms going in for well less than $2.00/Watt. Who knows about 2013?

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  68. By Rufus on September 7, 2011 at 1:50 pm

    With the 120 MW-ThinFab™ line, Oerlikon Solar has successfully lowered production costs for modules to under EUR 0.50/Wp, nearly less than half of the previous generation. These lower production costs can be primarily attributed to the ability of production lines to manufacture increasingly thinner films with optimized material usage.

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  69. By russ on September 7, 2011 at 2:01 pm

    Rufus said:

    The blue suede boys are making a fortune on the installation, now; but I guarantee you it won’t last. If you can buy a panel for less than a dollar/watt, now, I’ll bet you a dollar to a doughnut I could install a “farm,” inclusive of panels, hardware, invertors, labor, etc,. for real close to $1.75/Watt, and make a small profit.

    I remember just a year, or so, ago, that First Solar said it would soon be able to manufacture a solar panel for $1.00/Watt, and we got the same hoot from the fossil fuel guys that we’re getting now.

    It’s the 21st Century, guys; live with it.


     

    Rufus – as normal you are talking out of your hat about something where you have zero knowledge.

    You got no hoot a year back because that is when you didn’t realize that panels aren’t 100% efficient.

    Having an idea of the costs of solar PV installation, no one selling for under 5$ per watt DC is making more than a living.

    It is nice that you realize it is the 21st century though.Confused

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  70. By russ on September 7, 2011 at 2:04 pm

    Rufus said:

    With the 120 MW-ThinFab™ line, Oerlikon Solar has successfully lowered production costs for modules to under EUR 0.50/Wp, nearly less than half of the previous generation. These lower production costs can be primarily attributed to the ability of production lines to manufacture increasingly thinner films with optimized material usage.


     

    Costs – now add R&D, investment, return on investment etc – they are not selling it for close to that.

    Yes – you were calculating how much power solar could generate in your county there in Mississippi as I remember – You were using 100% of the local annual average insolation figure.

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  71. By Rufus on September 7, 2011 at 2:53 pm

    Russ, you’ve just been making stuff up for years. There was never a day that I “believed solar was 100% efficient.”

    And, I have no idea what kind of living someone, somewhere might be making installing solar, but you “Overlook” the fact that I keep talking about Solar “Farms.”

    Rooftop Solar isn’t ready, yet (maybe, never will be on a residential basis.) But, give me a wide open field, a used flatbed truck, a trailer, a rented work area close to the job site, a couple of young day laborers that want to Work, and a used Ford tractor, with a post hole driller on front, and bet me I can’t make a profit at $0.25/Watt for silicon, and a touch more for thin-film.

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  72. By Rufus on September 7, 2011 at 3:02 pm

    And, if you had read the article you would have noticed that Oerlikon produces “Assembly Lines,” that they sell to Solar Manufacturers. There was no mention in the article of them even selling solar panels.

    Also, no one. Repeat, no one said a word about “selling for less than $0.70.” The entire article, and discussion was about “Manufacturing Costs.”

    Why do you insist upon turning every bit of good news into some sort of unpleasantness? My Goodness.

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  73. By Wendell Mercantile on September 7, 2011 at 4:05 pm

    But, give me a wide open field, a used flatbed truck, a trailer, a rented work area close to the job site, a couple of young day laborers that want to Work, and a used Ford tractor, with a post hole driller on front, and bet me I can’t make a profit at $0.25/Watt for silicon, and a touch more for thin-film.

    Rufus~

    You have all that in spades in Northwest Mississippi. What are you waiting for?

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  74. By Rufus on September 7, 2011 at 4:57 pm

    Manana :)

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  75. By Rufus on September 7, 2011 at 5:12 pm

    Truth is, Wendell, if they asked me for my advice, I’d have to say “wait a year.” Prices are just dropping too rapidly on everything.

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  76. By mac on September 7, 2011 at 5:25 pm

    Rufus said:

    “Why do you insist upon turning every bit of good news into some sort of unpleasantness? My Goodness.”
    _____________________________________________________________

    As you will soon find out from the critics, every time solar scores a “touchdown” (like the $1,00 a watt milestone) that somehow the goal-posts get moved and solar mysteriously gets slapped with yet another 15 yard penalty negating the touchdown pass,

    It wouldn’t matter if you could make solar panels for 5 cents a watt, and solar was twice as cheap as coal. The critics will then proceed to attack solar on the basis that it only produces power for about 8 hours a day, When you solve the storage problem and solar is operating 24/7 they will start bringing up “cradle to grave” studies about how the environmental impacts of silicon wafer plants is actually far greater than blowing up and literally leveling the mountains of West Virgina and eastern Kentucky for the coal that will very soon be gone.

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  77. By takchess on September 7, 2011 at 5:46 pm

    http://nextbigfuture.com/2011/…..ss-to.html

    A science project but who knows?

    Takchess

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  78. By Wendell Mercantile on September 7, 2011 at 6:22 pm

    if they asked me for my advice, I’d have to say “wait a year.” Prices are just dropping too rapidly on everything.

    Rufus~

    Had you been following that advice for the last ten years, you would have never bought a computer. You would have just sat around waiting year by year for the next price drop.

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  79. By Kit P on September 7, 2011 at 7:20 pm

    “Picking winners IS a policy that is sure to fail us.”

    The reason the policy fails, is losers are picked. France picked nuclear and has made it work. Germany and Spain picked wind and solar which has worked very well for the natural gas industry.

    “and I feel the ground shifting under our feet.”

    That is quick sand Rufus. The problem with wind and solar is not cost.

    “The critics will then proceed to attack solar on the basis that it only produces power for about 8 hours a day,”

    Gosh Mac that is kind of problem if you need electricity 27/7/365. Of course the other problem is that solar does not work for eight hours a day. If 20% is the ‘expected’ CF then you would have solar mostly does not work because most systems have a CF less than 10%.

    “literally leveling the mountains of West Virgina and eastern Kentucky for the coal that will very soon be gone.”

    Just drove through there and it is a very beautiful place. Reclaimed strip mind are very beautiful too. West Texas is its own kind of ugly. Thousands of wind turbines did not make it much uglier but wind turbines would make West Virgina and eastern Kentucky uglier. Maybe Mac can explain why he thinks wind and solar are not a bigger eye sore than a strip mine.

    Relative to coal, the wind turbines will soon be gone. Keeping them running is not sustainable.

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  80. By Rufus on September 7, 2011 at 8:53 pm

    Interesting article on those quantum dot panels.

    Solar is going to be very, very cheap, someday.

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  81. By mac on September 7, 2011 at 9:08 pm

    Kentucky Strip Mine

     

    Kayford Mountain strip mining

     

    Absolutely “Gorgeous” Kayford Mountain – eastern Kentucky

     

    ———————————————————————————————————————

     

    Windmills – Abilene, Texas

     

     

    I think I’ll stick with the windmills, thanks……………………………

     

     

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  82. By rufus on September 7, 2011 at 9:30 pm

    Sam/Robert check the spam box, please. Yeah, I know, I shoulda logged in. Sorry.

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  83. By Rufus on September 7, 2011 at 9:38 pm

    Here’s a beautiful office building. The South wall is just one big Solar Panel

    South of the 35th Parallel, I think some day all office buildings will sport a South Wall, and Roof that are, in essence, just one big Solar Panel. Maybe put a little slope on the South-facing wall, and roof.

    Gorgeous.

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  84. By rrapier on September 7, 2011 at 9:39 pm

    Rufus said:

    Sam/Robert check the spam box, please. Yeah, I know, I shoulda logged in. Sorry.


     

    Got it.

    RR

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  85. By rufus on September 7, 2011 at 9:42 pm

    Thanks.

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  86. By rufus on September 7, 2011 at 9:44 pm

    Great picture of the Ky strip mine, mac. :)

    I don’t believe even its momma could love it.

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  87. By rrapier on September 7, 2011 at 9:56 pm

    Rufus said:

    Great picture of the Ky strip mine, mac. :)

    I don’t believe even its momma could love it.


     

    I have just been writing about strip mines for my book today. Coal production isn’t an area that I know all that well, so it has been slow going. Right now writing about the number of people employed globally and the fatality rates in the industry historically, and in different locations today. (Queue up Kit P to say something meaningless in a reply since the topic is coal).

    RR

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  88. By rufus on September 7, 2011 at 11:45 pm

    In fairness, the strip mines in S. Illinois that I’m a little bit cognizant of have been reclaimed quite nicely. I imagine that mountain will, also, before all is said, and done.

    But, the timing was extraordinaire. :)

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  89. By rufus on September 7, 2011 at 11:53 pm

    I support Renewables strictly for “Economic” reasons. I’m sure that fossil fuels will, sooner than later, start getting pretty expensive. And, I’m just as sure that products that involve nano-technology, and bioscience will get cheaper.

    Of course, common sense tells us that if we let them destroy mountains, and leave the kind of mess that was in that picture, the next time it might not be that Mountain over there is W. Va. It might be that mountain over there in Eudora, Ms.

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  90. By Wendell Mercantile on September 7, 2011 at 11:58 pm

    Absolutely “Gorgeous” Kayford Mountain – eastern Kentucky

    Mac~

    Looks a bit like the Badlands in South Dakota, and people go there for vacations. In fact, our Federal government has even made a National Park there. Badlands National Park

    People are drawn to the rugged beauty of the Badlands. Videos and photos can provide just a sense of the amazing scenic landscape awaiting you at Badlands National Park.

    Considering that Kentucky coal provided electricity for millions of people, direct jobs for thousands, and indirect jobs for hundreds of thousands, perhaps not that bad a tradeoff.

    As the old adage goes, “You have to break eggs to make an omelette.”

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  91. By Oxymaven on September 8, 2011 at 9:59 am

    RE strip mine vs windmills.  To enhance the legitimacy of the photo comparison it would be interesting to see the BTU production / kilowatt hours/yr calculations from extracting coal from maybe a square mile (as shown in the picture) vs 10 windmills.  Similarly, it’s informative to look at how many gallons of fuel are produced from a square mile of oil sands, and compare it with millions of acres of corn ethanol or soybean/canola/camelina biodiesel production.

    “Footprints” count, and the high energy density fossil fuel sources tend to have much smaller land area footprints.  Their impacts are also very intensive of course, but they are much easier for environmental agencies (and society) to monitor and regulate.  Think about the water quality impacts from devoting 36 mil acres of US cropland (in 2011) to ethanol production – no oilfield or refinery would be allowed to have those kinds of untreated discharges.

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  92. By Wendell Mercantile on September 8, 2011 at 10:36 am

    “Footprints” count, and the high energy density fossil fuel sources tend to have much smaller land area footprints.

    Oxymaven~

    Excellent point. Footprints do count. For example the footprint of corn ethanol is absolutely gigantic spreading across much of America’s heartland, and has had extreme adverse environmental consequences.

    The destruction of the millions of acres of virgin prairie across the Midwest and Great Plains just to plow it up and plant corn (corn dependent on chemicals and fertilizer made from natural gas and petroleum) is arguably worse than removing coal from under a few tens of square miles of land. (And once that coal has been removed, the land can be landscaped, reseeded, and used for other purposes as Rufus has seen in Southern Illinois.)

    And look at the environmental consequence of the runoff from those cornfields on the Mississippi River basin and the Gulf of Mexico. It’s subjective of course, but which is worse? Taking coal out of the ground in Kentucky, or creating a “dead zone” due to agricultural runoff in the Gulf?

    A photographic image of a strip mine certainly looks worse than the benign image of a cornfield, but when — as you so well pointed out — one looks at their environmental footprint, a rather different image emerges.

    Which is worse? Taking the top off a hill in Kentucky or West Virginia to remove the coal, or plowing up millions of acres of virgin prairie in the Midwest to plant corn? Depends on your values of course, but native prairie can be just as beautiful as a hill or mountain in the Appalachians.

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  93. By mac on September 8, 2011 at 12:19 pm

    “The destruction of the millions of acres of virgin prairie across the Midwest and Great Plains just to plow it up and plant corn (corn dependent on chemicals and fertilizer made from natural gas and petroleum) is arguably worse than removing coal from under a few tens of square miles of land. (And once that coal has been removed, the land can be landscaped, reseeded, and used for other purposes as Rufus has seen in Southern Illinois.)
    ———————————————————————————————

    If we suddenly stopped all ethanol production in the U.S. and used the land to raise “food” crops instead, it would have zero effect on the dead zone in the Gulf of Mexico. Run-off contaminated with N-P-K fertilizers residue and pesticides is what is causing the dead zone, the very same fertilizers and pesticides that are used on food crops. Getting rid of ethanol is not going to save the Gulf and ethanol is not the reason there is a dead zone in the Gulf.

    Under law, the coal companies in eastern Kentucky are supposed to re-contour the hills after they have literally blown them up with dynamite to suck out the coal. They are supposed to re-plant and clean up their mess, Apparently they are not doing this in all cases, Coal companies are also leaving the mining tailings that are contaminating streams and rivers. All of this has caused opposition to continued strip mining to grow.

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  94. By Wendell Mercantile on September 8, 2011 at 12:53 pm

    Under law, the coal companies in eastern Kentucky are supposed to re-contour the hills after they have literally blown them up with dynamite to suck out the coal.

    Shouldn’t there be a similar law making farmers restore the prairies after they’ve planted corn and other crops and “sucked” all the nutrients out of the soil? Nutrients that took tens of thousands of years to accumulate in the bountiful soils of the Corn Belt.

    Farming is actually nothing more than “mining” the soil. Farming has devastated the huge swaths of beautiful virgin prairie that once covered the nation’s mid-section no less than coal mine operators devastate the areas where they work.

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  95. By Kit P on September 8, 2011 at 7:00 pm

    I do not have a problem with either coal or wind turbines. I have a problem with people who have lot of wind and not a lot of coal telling people who have no wind that they should use wind farms to make electricity.

    “it would be interesting to see the BTU production / kilowatt hours/yr calculations”

    Just an estimate but the picture of the strip provides enough coal to power 5000 MWe (or about 5 million homes) of coal plants exactly when the electricity is needed for many years.

    On the other hand, the picture of the wind farm provides zero MWe electricity when it is needed. When the wind is blowing, that picture provides 10 MWe.

    “I think I’ll stick with the windmills, thanks”

    So you are willing to do without electricity 2/3 of the time?

    Our recent road trip included eastern Kentucky and the Badlands. I am always looking the environmental impact of making electricity. The footprint of making electricity is very small.

    We live in a society of strip malls. There are two main roads for me to find something like fast food or tires. One is an ugly of suburban sprawl and the other has been built with the architectural theme of Thomas Jefferson.

    So if you set out to take pictures of strip mines you would be distracted by all the surrounding beauty but if strip malls is your thing keep in mind that there is a huge ratio of strip malls to the power plants that provide the energy.

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  96. By Wendell Mercantile on September 8, 2011 at 10:56 pm

    We live in a society of strip malls.

    I agree completely Kit P. No matter where I go in the United States I’m beset by the ugliness of strip malls, big-box stores, and suburban sprawl. At least with strip mines the ugliness is localized, and the strip mines do have the incalculable benefit of providing coal that supplies millions of people with electricity.

    We could do more for the beauty of America by going after strip malls with the same fervor as those who want to ban strip mines.

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  97. By mac on September 9, 2011 at 3:42 pm

    Why did Solyndra go out of business ? And were they just a ‘scam’ from the very beginning ?

    Solyndra was a thin film solar player competing against the likes of First Solar and Oerlikon.

    Manufacturing cost per watt:

    First Solar (U.S.) ,72 cents per watt U.S. $
    Oerlikon (Swiss) .70 cents per watt U.S. $

    Solyndra (U.S.) 3.25 per watt U.S. $

    ———————————————————————–

    Solyndra had a unique 3-D collector technology that captured incidental solar radiation more efficiently that standard flat plate solar collectors. (First Solar/Oerlikon) The easiest explanation of how Solyndra was supposed to work is this promotional video on U-tube.
    http://www.youtube.com/watch?v…..zvIe2YDXGo

    Why did we give $500 million to a company that can’t compete ?

    ——————————————————————————————

    Was Solyndra just a scam from the very beginning ? I don’t think so, but did the executives who rode the company into bankruptcy make off with “golden parachutes” ? ——- probably so.

    Maybe that’s why Obama needs to appoint Robert as Technology Evaluation Czar.

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  98. By tstreet on September 9, 2011 at 10:20 am

    The decision to support Solyndra may have been ill advised but I think that there still should be money set aside for R&D. This is true regardless of the industry and one should recognize that R&D is necessary to continue progress in the solar industry and in other industries. It is the very nature of the process that investments in this field or any field will not always pan out, especially if one is trying to encourage leading edge research and development.

    No doubt that Obama is bowing to what he sees as political reality. However, it is also imperative that groups like 350.org highlight the environmentally destructive practices of the tar sands industry. The fact is that we must cut back on fossil fuels and we should start with those fuels that are the most carbon intensive.

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  99. By Wendell Mercantile on September 9, 2011 at 10:43 am

    The fact is that we must cut back on fossil fuels and we should start with those fuels that are the most carbon intensive.

    tstreet~

    I assume from your comments you have forsaken ownership of a car and consume no fossil fuels, right?

    As for the oil sands: You realize I hope they are in Canada, and we can’t tell Canada what to do with them. We can decide not to accept oil from Alberta, but that doesn’t mean they would stop extracting oil from the sands. They would instead build a pipeline to Vancouver, and from there ship the oil to China and India. Countries where people eagerly want to buy cars and enjoy the middle-class lifestyle we and the other developed nations have enjoyed for the last 60 or so years.

    There is oil in the sands of Alberta, and people will pay to use that oil. If not us, it will be someone else — unless you want to send an Expeditionary Force to Canada and capture the oil sands so no one can use them.

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  100. By mac on September 9, 2011 at 5:26 pm

    Hug Big Oil, Kill the Green Industry

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  101. By rrapier on September 9, 2011 at 7:16 pm

    mac said:

    Was Solyndra just a scam from the very beginning ? I don’t think so, but did the executives who rode the company into bankruptcy make off with “golden parachutes” ? ——- probably so.


     

    I am just waiting for that shoe to drop. I fully expect that we will find out that the top executives paid themselves bloated salaries and made out pretty nicely. This is why we have to stop front-loading these deals like this. Put the prize at the end of the race. If you put it at the beginning, some will collect it and then retire to the couch to watch TV.

    RR

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  102. By Kit P on September 9, 2011 at 9:29 pm

    “Was Solyndra just a scam from the very beginning ?”

    99% of solar is a scam! Let me give you an example of an application of solar that is not a scam. I just paid about $20 for 1.5 watt solar charger to keep the batteries charged on my boat. I have one that is a gift and it worked well. If I get one extra year of life on a expensive marine battery it will pay for itself.

    A scam is when the economic value of something is falsely and knowingly misrepresented.

    tstreet writes,

    “The fact is that we must cut back on fossil fuels and we should start with those fuels that are the most carbon intensive.”

    While I do not subscribe to extreme AGW theories, solar would be an example of an environmental scam because it is a very ineffective way to replace fossil fuel.

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  103. By Wendell Mercantile on September 10, 2011 at 12:05 pm

    I am just waiting for that shoe to drop. I fully expect that we will find out that the top executives paid themselves bloated salaries and made out pretty nicely.

    There is also the question of whether DOE did their proper due diligence before granting the loan, and whether any campaign contributions or special favors were involved.

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  104. By rrapier on September 11, 2011 at 3:36 am

    Kit P said:

    A scam is when the economic value of something is falsely and knowingly misrepresented.


     

    That has frequently been the case with ethanol, yet I don’t ever recall you calling it a scam. I can certainly give you specific examples where people have grossly exaggerated the amount of oil displacement, for instance.

    RR

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  105. By Tom on September 11, 2011 at 10:49 pm

    Robert

    You’re a brilliant guy but you make no sense when you say stuff like this:
    “We need to place the prize at the end, not at the beginning. We need to reward companies that deliver, not those that promise to deliver. In many cases, companies simply squander this “free money” in ways that should not be tolerated. What we need to do is level the playing field for all companies and allow them to compete. Those that ultimately deliver will be the ones who collect the prize. That is the way business is supposed to work. That is the way great companies are built.”
    The beauty of a free market is people always are rewarded when they convert ideas into successful products. We don’t need the government involved at all. Please give me several examples where the government has successfully incentivized renewable energy production.
    Again, I love reading your thoughts but you seem to refuse to admit the government has hurt, not helped, alleviate the coming energy crunch.

    Respectfully,

    Tom

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  106. By rrapier on September 12, 2011 at 12:22 am

    Tom said:

    Again, I love reading your thoughts but you seem to refuse to admit the government has hurt, not helped, alleviate the coming energy crunch.

    Respectfully,

    Tom


     

    Tom,

    When have I ever said that the government has helped alleviate the energy crunch? Most of the time we are discussing how badly they have screwed it up. But I think they could help. I think if we simply sit back and let the free market dictate, we will slowly be strangled to death by OPEC and by growth in China and India. I believe we need some incentives for renewables, but not the way we do them now.

    RR

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  107. By rrapier on September 14, 2011 at 3:34 pm

    Tom said:

    Robert,

    If we let the market work, including not intervening militarily trying to stabilize oil producing countries, the price of oil will rise dramatically. The much higher prices will stimulate both conservation and production of both conventional oil and renewable fuel.


     

    Tom, I firmly believe that if we simply leave things up to the market, we are going to be in an endless recession and we will continue to grow economically weaker as the oil exporters grow stronger.

    Your comment that the government incentives will work if they just
    get them right is naive. Please give me some examples where they have
    gotten their incentives right.

    I suppose that depends on your perspective. Corn ethanol supporters would declare that they got the ethanol incentives right. People who support offshore drilling will tell you that there are certain incentives there that push them toward a drilling decision. So, yeah, I believe that incentives can work as intended. The reason they don’t for the most part is that they aren’t really being used to promote long-term renewable energy. They are being used as political favors to benefit select groups instead of benefitting the overall public.

    RR

     

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  108. By Tom on September 14, 2011 at 11:52 am

    Robert,

    If we let the market work, including not intervening militarily trying to stabilize oil producing countries, the price of oil will rise dramatically. The much higher prices will stimulate both conservation and production of both conventional oil and renewable fuel. If we have the government incentivize the search for renewables, we will end up with nothing but products such as corn ethanol.

    Your comment that the government incentives will work if they just get them right is naive. Please give me some examples where they have gotten their incentives right. We both can come up with plenty where they have gotten them wrong. How much damage are we going to allow the government to do to the search for alternatives before we get them completely out of the way of free enterprise, free markets and the innovation they inspire?

    Tom

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  109. By Walt on September 15, 2011 at 10:25 am

    Robert Rapier said:

    The reason they don’t for the most part is that they aren’t really being used to promote long-term renewable energy. They are being used as political favors to benefit select groups instead of benefitting the overall public.
    RR

     


     

    This is the reality.  It exists at the state and federal government levels…although the federal government is far worse.  Policy and regulations drive investment into certain pockets, and to achieve that advantage you need to investigate who writes the legislation that become law.  Of course, there is a back and forth compromise to final legislation, but in general terms what is passed is what is put before both sides of congress to approve.  If there was integrity in the process, where legislators took no bribes for these favors, the system could work well.  The problem is that in order to be relected and stay in power one has to compromise, take the bribes (under or over the table) and support a handful of loyal supporters at the expense of the general good and welfare of the common people.  I could not agree more with RR’s comments above.  Everything the government passes in legislative process determines who will win and loose.  It is not a true free market.

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  110. By Kit P on September 15, 2011 at 8:54 pm

    Energy in the US is one of the most regulated segments of industry. The concept of a ‘free’ market is just absurd. For good reason too! Energy is an essential need like food and water.

     

    Some incentives based on production work well like a production tax credit and renewable energy portfolio standards. Goals should be modest with the idea that it takes time to develop resources and the need to find alternatives is for planning purposes in case there is future crisis.

     

    The game some play is to impose unrealistic goals and then label something a failure. For example, someone once said that nuclear power would be too cheap to meter. It is true that that nuclear generating costs are lower than coal and NG, wholesale generating cost are just part of the cost of providing electricity.

     

    Another example,

     

    “where people have grossly exaggerated the amount of oil displacement ”

     

    There are a lot of ethanol plants, wind turbines, and solar systems working at design capacity that would not have been built without incentives. Time will tell if they are a good investment.

     

    Then there are the failures. Every industry has failures. Another game is to paint an industry with a broad brush based on isolated cases. If one PV system has a capacity factor of 19% compared to an expected 20% but another gets 10%, I will show you folks with too much money putting PV on roofs near the ocean with lots of clouds that have to burn off every morning.

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  111. By rrapier on September 15, 2011 at 9:10 pm

    Kit P said:

    The game some play is to impose unrealistic goals and then label something a failure.


     

    I was simply responding to your definition of a scam. It is a fact that many ethanol proponents have misrepresented the value. That doesn’t mean that there is no value, but you didn’t say there had to be no value. I am just saying that per your definition corn ethanol would be considered a scam.

    RR

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