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By Robert Rapier on Dec 31, 2012 with 2 responses

The Top 10 Energy Stories of 2012

Tags: Top 10

Happy New Year’s to readers everywhere! Last week we posted a poll listing 15 of the major energy stories of 2012. Readers voted, and the Top 10 are presented below with a short narrative describing the story.

1. Revolution in US oil and gas production continues

The fracking revolution in the US continued, with oil production at its highest level since 1998 and dry natural gas production at an all-time high. President Obama became the first president since LBJ to serve in office during four consecutive years of increasing US oil production. The International Energy Agency (IEA) projected that by 2020 the US will become the world’s largest oil producer. They also projected that the US would become a net oil exporter again by 2030, which would be the first time that has happened since the 1940s.

2. Hurricane Sandy and the Aftermath

Hurricane Sandy struck the Eastern seaboard in October, leaving millions without power. In the aftermath of the hurricane, there were widespread gasoline shortages, leading to 1970s-era gasoline rationing in New York and New Jersey.

3. New CAFE standards doubled to 54.5 MPG by 2025

The Obama administration announced tough new regulations that call for a near doubling of fuel economy by 2025 to 54.5 miles per gallon. The National Automobile Dealers Association criticized the new standards, stating that they would raise the average price of a new vehicle by nearly $3,000 and would make new cars unaffordable for nearly 7 million people.

4. India blackouts leaves 680 million people in the dark

India’s overburdened power grid failed, resulting in the largest power outage in history. Three regional grids collapsed, cutting power to an astounding 680 million people. The country’s rail system was paralyzed, and there were major traffic jams in cities affected by the blackouts.

5. Low natural gas prices stimulate US economy

For many years, industries that depend on natural gas as a major input have been leaving the US in search of cheaper gas supplies. These industries include chemical companies and fertilizer manufacturers. Low natural gas prices have led to a resurgence in interest in projects in the US. The New York Times reported that Dow Chemical has identified 91 new manufacturing projects representing potentially $70 billion in new investments and up to three million jobs that companies have started or proposed as a result of cheap natural gas. A report from the Yale Graduates Energy Study Group indicated that in 2010 cheap gas provided a net benefit to the US economy in excess of $100 billion.

6. California Implements Cap and Trade

California implemented the first legally binding greenhouse gas (GHG) cap-and-trade program in the US. The program covers the state’s major sources of GHG emissions power plants, refineries, and industrial facilities. The program is intended to to reduce California’s greenhouse gas emissions to 1990 levels by 2020. NASA scientist and climate change activist James Hansen criticized the program for not going far enough, calling it “half-baked” and stating that “It’s certain that it won’t be effective.”

7. China in North America’s Oil Sands

China has long held ambitions with respect to North American resources. In 2005, China National Offshore Oil Corporation Limited (CNOOC) made a takeover bid for U.S.-based Unocal, which was the 9th largest U.S. energy company. The bid ran into serious political opposition, and was ultimately withdrawn. Having learned valuable lessons from their Unocal experience, in 2012 CNOOC made a successful $15 billion bid to take over the Canadian oil company Nexen. The deal is the largest-ever acquisition by a Chinese company, and gives China a more active presence in Canada’s oil sands. (China has already made investments totaling nearly $3 billion in Canada). Although approving the bid, the Canadian government also stated that future deals would only be approved under exceptional circumstances.

8. Obama Rejects Keystone XL Extension, Endorses Southern Leg

When it looked like the Obama Administration was headed toward approving the Keystone XL Pipeline project in 2011, environmentalists organized protests at the White House against the “tyranny of oil.” The President bowed to the pressure, and announced that it would be impossible to make a decision on the project before the 2012 presidential election. In January Republicans passed a provision that forced the administration to make a decision, which resulted in the State Department rejecting the application for Keystone XL extension due to insufficient time to study the project. However, during a campaign appearance in Oklahoma, the president endorsed the southern portion of the pipeline that would connect Oklahoma to the Gulf Coast, announcing that he would “cut through the red tape, break through the bureaucratic hurdles, and make this project a priority.”

9. Obama reelection

President Barack Obama was reelected for a second term, which means that the energy policies of his first term are likely to continue. This was generally viewed as good news for renewable energy, bad news for the coal industry, and mildly bad news for the oil industry — even though the oil industry didn’t do too badly during President Obama’s first term.

10. US Carbon Emissions Plummet

Coal consumption in the US continued to fall because new supplies of natural gas are displacing coal in power plants. The change has been so dramatic that since 2006, the U.S. has been the world leader in reducing carbon dioxide emissions since natural gas emits less carbon dioxide per unit of power produced. US carbon dioxide emissions have fallen to a 20-year low as a result.

Link to Original Article: The Top 10 Energy Stories of 2012

By Robert Rapier

  1. By Murateticaret on January 4, 2013 at 6:58 am

    Great review you have shared on energy.

    [link]      
  2. By Tom G. on January 5, 2013 at 5:45 pm

    Some days I just seem to run out of stuff to blog about and well – get sort of bored. I guess this lack of brain cell stimulation also causes me to take a less than technical examination of the issues and forces me to shot from the hip so to speak. So since our host has taken all of the work out of my trying to find something to blog about, I will just plagiarize his work. To the extent possible I will place in quotes “ “ his original work.

    “1. Revolution in US oil and gas production continues. The fracking revolution in the US continued, with oil production … ”

    AND water table pollution is at it’s highest level since fracking began. According to some environmentalist and their publications and blog sites; unless actions are taken soon; more that 50% of all ground water in facking formations will become contaminated.

    “2. Hurricane Sandy and the Aftermath. Hurricane Sandy struck the Eastern seaboard in October, leaving millions without power. In the aftermath of the hurricane, there were widespread gasoline shortages, leading to 1970s-era gasoline rationing in New York and New Jersey”

    WHICH points out the futility of DEPENDING on fossil fuels as storms and global warming accelerates. If you don’t believe that global warming exists that is fine with me but it is hard to deny that methane is boiling up in the sea after the ice sheet has melted. It is also true that a fairly substantial percentage of Methane is also escaping from fracked formations and many people are beginning to believe that Natural Gas might not be the wonderful transition fuel we once thought it was.

    As far as the poor people who have been displaced by Sandy, I would salvage what I could from my home and move to higher ground. More hurricanes are on the way – maybe not this year or the next but they WILL come. And sooner or later those low lying water front homes are going to become either high priced homes with a view of a concrete berm or abandoned real-estate. That is what is happening in Florida, New Orleans and other parts of the world.

    ”3. New CAFE standards doubled to 54.5 MPG by 2025. The Obama administration announced tough new regulations that call for a near doubling of fuel economy by 2025 to 54.5 miles per gallon. The National Automobile Dealers Association criticized the new standards, stating that they would raise the average price of a new vehicle by nearly $3,000 and would make new cars unaffordable for nearly 7 million people.

    Well if you want my opinion, I think 7 million more people riding mass transit makes good sense. Not only that, just try and drive on L.A. freeways anytime between 6:00 am and 8:00 p.m and we are a long way from 2025. And by the way; 2013-2025 is 12 years. If I can’t find ways to increase fuel economy from 27 mpg between now and then I better quite. Let’s see a 2 mpg improvement per year for 12 years equals a 24 mpg improvement. Not only that the way the legislation is written many say the 54.5 mpg requirement is really only about 40 mpg. Good grief – Ford is already above 30 mpg fleet average. And if you average in Hybrid Vehicles [50 mpg] and Electric Vehicles [100+ mpg], what’s the problem. NADA is nothing more than a lobbying group for the auto industry. They are doing what their members want them to do and that is to help the automotive industry keep on selling the same old inefficient vehicles.

    “4. India blackouts leaves 680 million people in the dark. India’s overburdened power grid failed, resulting in the largest power outage in history. Three regional grids collapsed, cutting power to an astounding 680 million people. The country’s rail system was paralyzed, and there were major traffic jams in cities affected by the blackouts.”.

    See what happens when you have only two classes of people in a society. India has two classes of people. The wealthy own the power companies and the poor steal as much power as they can. If you can’t see where America is heading then you haven’t been paying attention lately. When everyone in American is on the dole – our economy will collapse. Last year 10 of the top corporations in American payed no Federal Income Tax and some of those corporations even got refunds. One fifth of all Americans are on food stamps. A number someplace between 10-20% of our population is unemployed or underemployed. Most households have two working parents. Our society which once seemed to have the money to pay for the psychiatric care of sick individuals now seems only able to pay for something quite different. Now we have our Department of Homeland Security creating a civilian army of young Americans armed with automatic weapons ready to put down any civilian disturbance. You didn’t miss the story did you? How many bullets did Homeland Security order – I forget.

    “5. Low natural gas prices stimulate US economy …”. The New York Times reported that Dow Chemical has identified 91 new manufacturing projects representing potentially $70 billion in new investments and up to three million jobs …”. A report from the Yale Graduates Energy Study Group indicated that in 2010 cheap gas provided a net benefit to the US economy in excess of $100 billion.:

    O.K so lets see how this works out. The Bureau of Labor Statistics approximates the average wage in America as about $41,000.00/years. Low Natural Gas prices are being credited with a net benefit to the economy of $100 billion according to Yale. $100 billion divided by $41,000 equals 2,439,024 jobs. So we are loading up our air with Methane, CO2 and Carbon and polluting our ground water lake and rivers with unknown chemical that have an unknown effect on people and our environment. Does that really sound all that smart to you?

    Last year according to T. Boone Pickens we spent somewhere between $300 and $400 billion on imported fuels. Of course some of this was refined and resold to other countries but lets be conservative and say that about $250 billion of our American dollar bills left for foreign shores. If that money had been spent in the United States, that amount of money would have created about 6.1 million jobs. If you want to see our economy come to life and unemployment drop to 4% – stop with the oil nonsense. You know what – either you want to keep up this raping of the American people or you want something better. In my not so humble opinion, we have less than one generation to get our act together. So far I don’t think we are off to a very good start.

    6. California Implements Cap and Trade. …climate change activist James Hansen criticized the program for not going far enough, calling it “half-baked” and stating that “It’s certain that it won’t be effective.”

    I agree – Cap and Trade is a flawed concept who’s purpose is to line the pockets of some wealthy individuals and fill the coffers of the state government. If you feel compelled to do something – initiate a Carbon Tax. I can track tax dollars; I have a much harder time tracking the trading of smoke from one location to another. And that is what Cap and Trade is – it is the buying and selling of smoke or some other pollutant. While is has worked for some pollutants in some parts of the country, in my opinion; it is a flawed concept.

    “7. China in North America’s Oil Sands – No Comment.

    8. Obama Rejects Keystone XL Extension, Endorses Southern Leg – No Comment other than it will be passed.

    9. Obama reelection – No Comment

    10. US Carbon Emissions Plummet”

    Wikipedia had this to say about Methane: “Methane is a relatively potent greenhouse gas. The concentration of methane in the Earth’s atmosphere in 1998, expressed as a mole fraction, was 1745 nmol/mol (parts per billion, ppb), up from 700 nmol/mol in 1750. By 2008, however, global methane levels, which had stayed mostly flat since 1998, had risen to 1800 nmol/mol.[3] “.

    And we thought Natural Gas was so wonderful didn’t we. “Pound for pound, the comparative impact of CH4 on climate change is over 20 times greater than CO2 over a 100-year period.”. Are we making progress in one area just to fail in another?

    Tom G.

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