Shale gas producers’ first stabs at ‘standards’ & ‘practices’: how much do they reduce accident risk?

Written by aspowell on May 1, 2012 — Leave a Comment

That’s at least one question on this blogger’s mind. One cannot help but note the absence of “best practices” because, well, they aren’t, at least not yet.

Can they be?

I, for one, am willing to believe the industry CAN produce bonafide best practices. But there needs to be sufficient input from from a variety of informed stakeholders, including experienced hands in the industry, current or former regulators, a few well-intentioned landowners, perhaps a few highly-qualified academics and level-headed non-governmental organizations such as the Environmental Defense Fund.

Anadarko Petroleum, a leader of the Appalachian Shale Recommended Practices Group, pledges "Open Communication" with stakeholders on its web site.

A group calling itself the “Appalachian Shale Recommended Practices Group,” led by Anadarko Petroleum, this week issued “Recommended Standards and Practices” as a “framework for protecting workers, the environment and the communities in which we operate.”

A careful reading of the eight pages of “General Principles for Operators” followed by the “Responsible Standards and Practices” is chock-full of aspirations and good intentions. Even relying on “guidance documents” from the American Petroleum Institute, they fall far short of accountability.

Operators are to “encourage”, “emphasize,” “strive,” to do what  any reasonably qualified oil and gas driller should do to minimize the impacts of its operations. There appears to be no discernible and objective and/or quantifiable standard that under-funded or less-experienced operators could be held to account for.

On “Site Section Selection and Assessment,” operators “should consider…” and “should conduct…” themselves in manners that are unlikely to earn the trust the industry needs to realize the potential of America’s natural gas resources.

On “Site Design and Construction,” here too operators “should consider…”, “should use…” and “should prepare…”as reasonably practical”…. Where are the robust standards the industry and its stakeholders can point to, with confidence, that acknowledge the risks and work measurably to mitigate them?

Judge for yourself here.

The Appalachian Practices Group is comprised of: Anadarko Petroleum Corporation, Cabot Oil & Gas Corporation, Chesapeake Energy Corporation, Chevron, EQT Corporation, Seneca Resources Corporation, Shell Oil Company, Southwestern Energy Company, Talisman Energy Inc.,  WPX Energy, Inc. and XTO Energy Inc.. XTO was recently acquired by ExxonMobil.

The Marcellus Shale Coalition doesn’t even go this far, issuing to date only Guiding Principles. The Principles “strive to …are committed to…continuously improve…and “seek transparency”. One cannot help but ask: Where does the buck stop? Is this mostly a PR stunt?

On one point America’s Natural Gas  Alliance, which represents independent oil and gas drillers,  and the Marcellus Shale Coalition, whose members drill mostly in Pennsylvania, agree. Both issued supportive statements today following up the nominal efforts thus far to address the compelling need for best practices that will help protect and sustain the hydraulic fracturing for natural gas.

Regina Hopper, ANGA’s president and chief executive officer, acknowledged in a statement the “importance of public engagement and working with diverse stakeholders.”

Kathryn Klaber, president of the Marcellus Shale Coalition, said “Transparent operating standards are critical to the long-term growth and sustainability of our industry throughout Appalachia.”

Klaber asserted the Coalition “will continue to collaborate with all stakeholders — regulators, non-governmental agencies, academic institutions, and others — to raise the collective bar on behalf of future generations.” But she did not identify the non-industry groups the Coalition has been collaborating with, or what collaboration actually involves.

Thus far, the industry’s actions fall short of their words.

Posted in Hydraulic fracturing, Natural gas, Shale natural gas | Tagged , , , , ,

Sprint-ing, not walking, the ‘talk’ to achieve sustainability goals

Written by Jim Pierobon on April 25, 2012 — Leave a Comment

It’s becoming more clear every day that cleaner energy and environmental sustainability depends on private industry.

The expiration of many renewable energy incentives, zero prospects for a U.S. carbon tax or a cap and trade program, restraints on public spending and the low price and growing supplies of natural gas are putting commitments to renewable energy and sustainability under the corporate microscope.

So measuring companies with a green ‘yardstick’ spotlights those who walk the talk throughout the company and those who are ahead of the pack.

Let’s take Sprint. From commercial and home energy management, to displacing fossil fuels with alternative sources of energy to collaborating with clean tech innovators and recycling used cell phones, Sprint is one of a handful of companies we thrive on showcasing here at The Energy Fix.

Exhibit A – Alternative Energy: Let’s start with Sprint’s own carbon footprint. Its wireless network operations account for about 80 percent of its total corporate energy use. Sprint is on track to install hydrogen fuel cells for backup power at more than 500 of its rapidly expanding network of wireless antenna stations throughout the U.S. by year-end 2012.

The hydrogen fuel cells provide 72 hours on on-site power backup. That is a significant step up from what has been the traditional backup time-frame of only 15 hours.  They replace mostly diesel-fuel power generators and eliminate noise and harmful emissions. Other byproducts of this push for fuel cells are lower operating costs and increased network dependability. Sprint already powers several of its antennas during daytime hours with solar systems.

Sprint has secured 5% of its total energy use from renewable energy sources. That places it in 26th place on the U.S. Environmental Protection Agency’s latest quarterly update to the “Green Power Partner” rankings for Fortune 500 companies as of April 5, 2012.

Sprint is doing more than recycling cell phones. CREDIT: HotHardware.com

Exhibit B – Energy Management: Sprint is working with SmartLabs INSTEON to enable home owners and businesses to access and control their energy consumption from a simple Web portal or Sprint smartphone. Property owners can schedule electrical devices to turn on or off, especially when local power demand exceeds the capacity of the regional grid and risks of a brownout or outage escalate.

In fact, Sprint is piloting an INSTEON integrated commercial energy management system at one of its retail stores. The system enables programed cooling, heating and ventilation based on current and forecast weather. According to Brian Huey, a Sprint smart grid / utility / energy business development manager, the typical store is saving about 28% on year-to-year electricity consumption, along with the associated reductions in emissions.  In states with time-of-use pricing, the cost savings can boost the bottom line.

Exhibit C – Smart Grid Collaboration: One of Sprint’s core businesses is applying it wireless network talents and technologies to facilitate the evolution of smart grid applications. The company is partnering with a variety of name-brand companies such as Itron, Landis & Gyr and Metrum to overlay communications systems linking power generators, distribution utilities and consumers through smart meters.

Huey told The Energy Fix this is a logical outgrowth of the company’s symbiotic relationship with utilities drawing on its original push-to-talk technology. “Sprint in not a Johnny-come-lately. We’ve been in this industry for many, many years with iDEN enabled smart meters and RTUs (Remote Terminal Units),” Huey said.

Sprint has a collaboration center in the San Francisco Bay area where smart grid application developers can work side-by-side with Sprint engineers and support staff. There they model and test how machine-to-machine (“M2M”) applications can help residences and businesses reduce their energy consumption.

Exhibit D – Electric Vehicles: In yet another partnership, Sprint is working with Ecotality to deploy about 15,000 electric vehicle charging stations in 16 cities, enabling billing services. Plus customers can receive notification of a charge interruption or completion.

Exhibit E – Supply Chain Sustainability: Sprint was the first U.S. wireless carrier to establish environmental specifications for future devices and accessories. It has a scorecard to encourage vendor participation and collaborated with Underwriters Laboratory (UL) Environment and device manufacturers to develop a sustainability certification process for mobile phones. The draft standard was released late last year and Sprint has since launched 3 devices with the highest level of certification offered with the standard. Sprint now requires all new mobile phones to go through the certification process.

These and other corporate sustainability / social responsibility initiatives earned Sprint the #3 ranking on Newsweek magazine’s 2011 ranking  of “America’s Greenest Companies.” That is up from #6 in 2010 and #15 in 2009. Could #1 be far behind?

Posted in Cap and trade, Carbon capture, Clean tech, Clean transportation, Costs of energy, Demand response, Electric transportation, Electric vehicles, Energy efficiency, Home energy management, Innovation, Load response, Renewable energy, Smart grids, Smart meters, Solar energy, Sustainability, U.S. EPA | Tagged , , , , , , , , , , , , , , ,

Benefits of an independent safety center for oil and gas hydraulic fracturing

Written by Jim Pierobon on April 20, 2012 — Leave a Comment

If safety truly is a priority for companies producing oil and gas using hydraulic fracturing, they should match their words with genuine safeguards that the public and regulators could see and understand.

The nuclear industry has long been working to improve safety of utility-owned nuclear power plants under the auspices of the Institute of Nuclear Power Operations, or INPO, in Atlanta. The American Petroleum Institute (API) has launched the Center for Offshore Safety. or COS, in Houston led by former Shell Oil senior scientist Charlie Williams.

Both of those organizations, of course, were motivated by serious accidents the likes of which “fracking” companies have not experienced and hopefully never will. INPO was conceived out of the 1979 meltdown at the Three Mile Island nuclear complex near Harrisburg, Pennsylvania. It is not transparent and wasn’t designed to be, working only within the industry.

The Center for Offshore Safety is designed to address challenges and still lingering doubts about the industry’s ability to operate in deep waters after the deadly 2010 BP Horizon / Macondo well blowout in the Gulf of Mexico two years ago today. Most level-headed environmentalists are taking a wait-and-see attitude. Will it turn out to be mostly window-dressing by API? We’ll see.

So should oil and shale gas producers wait until any accident that impacts on groundwater supplies, methane emissions and perhaps even human lives? If there’s no accident, then no problem, right?

Here is the next major showdown over hydraulic fracturing for shale natural gas supplies: June 14-17, 2012 in Columbus, OH. CREDIT: 350.org

Human nature might suggest such.

But there is a growing body of strategic and proactive thinkers who grasp the game-changing role for newly-discovered crude oil and natural gas. They see the value of creating a safety center or council not just to help protect the environment and earn the public’s trust but to grow the business — if it can grow any faster than it is.

Such an organization, by whatever name, could strengthen the operations of small, suspect or otherwise inexperienced drillers. It also could demonstrate publicly the industry takes safety seriously enough to educate the public and stakeholders about fracking.

The ultimate measure of a safety center might best be judged by how transparent it is to the public and regulators. That might pose a problem for companies such as Halliburton which supplies fracking fluids to drillers. At an industry conference last October in Pittsburgh, the company made it clear it considers its fluid formula to be proprietary and wants to keep it a secret wherever it can.

A safety center could be funded by trade association dues or permitting and drilling fees paid by producers. It could be staffed in part by scientists from relevant trade groups and non-governmental organizations willing to work objectively with industry.

A safety center might be seen as a PR ploy. That said it could help loosen prohibitions against fracking in states such as New York, Ohio and Maryland. It could enlighten the debate in Ohio which is about to heat up. A Don’t Frack Ohio rally is slated for Columbus, Ohio June 14-17 by Bill McKibben and allies of his 350.org. See its poster, above.

Consider the Marcellus Shale Coalition and the now one-year old chemical disclosure registry at FracFocus.org., a joint project of the Ground Water Protection Council and the Interstate Oil and Gas Compact Commission. While not universally embraced by industry, FracFocus is being hailed by many analysts and critics as a significant step toward transparency. At least some industry pros say one benefit of FracFocus has been to raise the ‘bar’ for all companies which ends up helping the entire industry.

America’s Natural Gas Alliance last November stated “The industry  . . . is voluntarily moving forward with the recommendations” contained in a 2011 National Petroleum Council report “including the establishment of regional Centers of Excellence.” But there is no evidence of tangible progress available to the public.

“We realize the importance,” the Gas Alliance statement continued, “of reaching out to those in communities who are not familiar with energy development to have factual and science-based conversations about operations as well as safety measures and extensive oversight already in place.”

The American Petroleum Institute has at least five standards that apply to fracking for oil and natural gas. According to Oil & Gas Journal, and quoting then-API standards director David Miller, the ones generating the most interest involve well construction and integrity (“HF-1″) and isolating potential flow zones during well construction (“Std. 65-2″).

Email inquires to API  and the Marcellus Shale Coalition for additional information about the regional Centers for Excellence did not elicit a reply within 48 hours.

The Center for Offshore Safety aims to help oil-and-gas companies share data and information and make offshore drilling safe. It also seeks to provide third-party auditing of companies’ federally mandated safety and environmental management systems, or SEMS, which are meant to help identify and mitigate human and operational risks.

For a long time, the Institute of Nuclear Power Operations kept a low profile. Until recently it did not even have a publicly available web site. Maybe the Fukushima disaster altered the leaders’ thinking.

Amy Mall, who assesses hydraulic fracturing for the Natural Resources Defense Council, said if industry dominates a safety center or there is no independent scientific input or audit function, it’s a non-starter as far as she’s concerned. She cited the Forest Stewardship Council and the Roundtable on Sustainable Biofuels as models the oil and gas industry could draw from.

Posted in Fossil fuels, Hydraulic fracturing, Natural gas, Nuclear energy, Offshore drilling, Oil, Shale natural gas | Tagged , , , , , , , , , , , , , , , , , , , , , , ,

Commodity risks – how energy suppliers manage them can make a big difference to markets and customers

Written by Jim Pierobon on April 16, 2012 — Leave a Comment

More than a decade after the Enron debacle, one would think managing an energy company’s risks is a widely-agreed upon practice with similar types of standards. Yet with the ongoing volatility in oil and natural gas prices, accidents and ‘Acts of God’ that just keep happening and the growing interdependence in commercial markets on other companies’ risk exposures, that notion apparently is farther from reality than many executives think.

The completion recently by the Committee of Chief Risk Officers (CCRO) of recommended Risk Management Standards for Energy Market Participants suggests this industry may have a lot of work to do. Just meeting widely-agreed upon standards to ensure that effective risk management is within reach of company’s management could be an enormous undertaking for some companies.

The CCRO developed 27 standards without consideration for any regulatory or regulatory process, according to Executive Director Bob Anderson. Among the more active CCRO companies are Calpine, NRG Energy, Constellation Energy and ConocoPhillips.

Run this four-point spot check list for your company, your commercial partners and/or for companies you own stock in. It might save — or make you — a lot of money:

1. Independent Risk Governance (standards 1-6): The “Governing Body” (over risk management, typically the Board of Directors, Audit Committee or a Management Committee) periodically re-affirms its understanding of the firm’s risks and the firm’s capacity to fulfill potential future financial and physical obligations.

2. Risk Policies and Procedures (standards 7-22): They should include risk analyses and reporting; specific limits to market and credit risks; authorization of counter-parties and associated credit terms and limits; and monitoring of all transaction compliance issues.

3. Qualified Personnel (standards 23 & 24): The quality of the education program is readily apparent in the consistent manner that communication and discussion of risks is undertaken.

4. Risk Management Infrastructure (standards 25-27): A risk management system must capture transaction details, business process requirements, risk metric calculations and financial reporting.

The Commodities Futures Trading Commission could enhance the transparency of energy markets with rulings and definitions expected under the Dodd-Frank Act.

The timing for the CCRO’s paper may be prescient. Certain financial reporting requirements could grow significantly after this Wednesday’s public meeting of the Commodities Futures Trading Commission. The five commissioners may finalize its definition of a “swap dealer” and “major swap participant” among other terms as it continues its work on the Dodd-Frank Wall Street Reform and Consumer Protection Act.

For the first time, energy companies may be obligated to capture and report a significant amount of data that regulators and sophisticated investors can cull to better monitor and understand energy commodity markets. Ostensibly, that could lower risks to energy markets.

A swap is a derivative in which counterparties exchange cash flows of one party’s financial instrument for those of the other party’s financial instrument. The benefits depend on the type of financial instruments involved. A derivative is a security whose price is dependent upon or derived from one or more underlying assets. Its value is determined by fluctuations in the underlying asset.

While energy risk management might seem a somewhat arcane subject to improve what ails U.S. energy markets, there is a LOT of money spent on getting it right. If something goes wrong, not only are energy marketers and utilities at risk, so are the companies that rely on them and their end-users.

PJM Interconnection, which manages the power grid throughout many Mid-Atlantic states and parts of the upper Midwest, cited the CCRO’s paper in this Feb. 7 filing to the Commodities Futures Trading Commission about managing risks in competitive wholesale power markets. PJM asserted that it and other Regional Transmission Organizations (RTOs) and Independent Systems Operators (ISOs) should be exempted from certain rules under the Dodd-Frank law if the market participant’s risk management policies, procedures, and controls reflect certain criteria. “These criteria generally are the same criteria as those suggested by the Committee of Chief Risk Officers,” PJM stated.

You can access the CCRO paper for a fee here. There you will also find perspectives on energy risk management from companies such as PPL and NRG Energy and consultants such as PWC.

Posted in Energy risk management, Natural gas, Nuclear energy, Oil prices, Terrorism | Tagged , , , , , , , ,

How a company fracks for natural gas determines its corporate social responsibility

Written by Jim Pierobon on April 12, 2012 — Leave a Comment

As energy producers find more natural gas from shale formations throughout the U.S. and the price of natural gas continues to fall it should be no surprise that a debate looms over how a company fracks for natural gas and whether it is socially responsible.

On its face, with sufficient operational and risk controls in place, fracking should be able to meet most, if not all, definitions of corporate social responsibility (CSR). All it will take, however, for today’s discussions to become heated debates is a serious accident spoiling the groundwater supplies of a large population.

A typical well fracking for natural gas in shale formations. CREDIT: ProPublica.org. Be sure to check out ProPublica's coverage of fracking here.

Some industry analysts expect that a natural gas company fracking for new supplies will, eventually, experience the industry’s own version of a Three Mile Island (1979 nuclear meltdown), Exxon Valdez (1989 oil tanker leak) or BP Macondo (2010 offshore oil well blowout).

How the industry protects against that; how willing all companies that frack will abide by industry best practices remains to be seen.

CSRHub (subscription required) has added fracking to its list of “special issues.”  Those who have registered or subscribed on the site can choose to either approve of fracking, disapprove of it, or block out ratings entirely for companies who participate in the area.

The list of companies involved in this area was longer than CSRHub expected. It found that 51 companies out of the approximately 5,000 it covers participate in some sort of fracking. It has gather partial information on another 40 or so smaller companies.  It hopes to be able to publish partial ratings on these companies soon.

CSRHub created its list with a lot of help from five organizations and one well known expert in the area, blogger Mike Benard.  With help from Bernard, it reviewed data from FracFocus (44 companies matched our list), FracTracker (31 matches), Marcellus Shale Coalition (42 matches), Marcellus Money (26 matches), and the Pennsylvania Department of Environmental Protection (23 matches).  It combined their input with data Mike had gathered on 56 companies to create its final list.

As you can see from the sources it cited, a lot of attention focused on the Marcellus Shale formation that stretches across a large part of the US central and eastern region.  It hopes to add other sources soon that identify companies that are involved in fracking in other parts of the US and in the rest of the world.

“We suspect that there are at least another 100 companies among those we rate who participate in this area—either directly via drilling and exploration or through supplying materials to the industry or by helping to process and transport the gas and oil fluids they extract,” CSRHub says. “We encourage our community to suggest additional sources.”

The overall ratings for the companies covered by this special issue range from a low of 39 (using our average user profile) to a high of 64.  The average for each source’s list is right around the average score for its entire database—between 48 and 50.  This suggests that the companies involved in this area are not entirely positive or inherently anti-social—they may instead be ordinary companies that did not realize involvement in fracking could be controversial.

Controversial may be an understatement.

Posted in Energy risk management, Fossil fuels, Hydraulic fracturing, Natural gas, Shale natural gas | Tagged , , , , , , , , , , ,

Petty politics defeats wind offshore Maryland. Can a third bid succeed? Will Gov. O’Malley even try?

Written by Jim Pierobon on April 10, 2012 — Leave a Comment

“Petty political grudges” in Maryland’s Senate Finance Committee are to blame for the failure of the General Assembly to establish the mechanism to incent and pay for one of the first networks of offshore wind turbines anywhere off a U.S. coastline.

That’s the way Chesapeake Climate Action Network Executive Director Mike Tidwell put it in an email today to supporters in the worlds of faith, labor, civil rights, business health and the environmental activism who lobbied hard for the second consecutive year with Gov. Martin O’Malley.

3 of these 4 persons were arrested April 3 for their futile battle for an offshore wind bill in Maryland's legislature. They were among about 500 who hope there will be another chance in 2013. CREDIT: Chesapeake Climate Action Network

Tidwell did not point fingers but as The Energy Fix reported and tweeted here during the past two weeks, much of the focus was on one state senator who could have broken a 5-5 deadlock over the the Maryland Offshore Wind Energy Act of 2012:  Anthony Muse of Prince Georges County. Muse stymied similar legislation in 2011.

Will a third time be the charm? Will Martin O’Malley want to invest the political capital and risk striking out in 2013 as he ponders a race for President in 2016?

If the answer to the latter is no, then offshore wind in Maryland, and probably the entire mid-Atlantic coast, is dead for the foreseeable future. And nothing on the horizon would seem to inject the additional supported needed given the state of politics in Annapolis.

The defeat came after about 500 activists virtually surrounded the Capitol building April 3 in a show / circle of support which included O’Malley for Senate Bill 237. The House of Delegates passed similar legislation 88-47 March 30.

The companies that would have comprised a once-promising line-up of developers, financiers, turbine blade makers and parts manufacturers may have been lost — along with the political muscle to make offshore wind a reality anywhere in the region.

Gamesa Technology Corp. and the shipbuilding operations of Northrop Grumman Corp. launched an “Offshore Wind Technology Center” in Chesapeake, Va., in early 2011 to jointly develop the next generation of offshore wind systems. A spokesperson for neither company could be reached about whether the failure of wind proposals in Delaware, New Jersey and now Maryland could change their original plans to produce North America’s first offshore wind turbines by late 2012.

Posted in Clean energy, Costs of energy, Green jobs, Offshore renewable energy credits, Offshore wind, Renewable energy, Subsidies, Wind energy | Tagged , , , , , , , , , ,

Can Maryland spin any wind turbines off its coast after setbacks in New Jersey and Delaware?

Written by Jim Pierobon on March 30, 2012 — Leave a Comment

Offshore wind has two strikes against it in New Jersey and Delaware. Cape Wind off Massachusetts’ Nantucket Sound is fighting to stay alive in extra innings. Now Maryland is trying to get ‘on base’ with a second bid by Governor Martin O’Malley which is halfway toward approval (at this writing) by the state’s General Assembly.

A closely-watch proposal in New Jersey to build a 25 -megawatt pilot wind project offshore Atlantic City failed to meet a key state test earlier this year as it weighed the price premium consumers would be expected to pay with the hoped-for benefits. Before any offshore wind farm there can qualify for expensive subsidies from energy utility customers — the main source of financing for the building of wind turbines — it must demonstrate that net economic benefits such as creation of new jobs and other advantages outweigh projected price increases.

The relatively small size of New Jersey’s approach (see The Energy Fix post Nov. 3, 2011 here ) in state waters may doom its chances, especially with Republican Chris Christie as Governor there.

Not one to give up easily, O’Malley recast his 2011 proposal to fund 300 megawatts of wind energy with Offshore Renewable Energy Credits, or ORECs. One OREC is equal to the clean generation attributes of 1 megawatt hour of wind energy. Electricity suppliers in Maryland buy ORECs to help meet their share of a state requirement for sales of electricity generated from renewable and alternative sources.

Last year O’Malley and his allies tried — but failed — to pass a law that would have required the state’s electricity suppliers to pay for wind-generated electricity using a Power Purchase Agreement.

Green, religious and labor groups are planning to surround Maryland's Capitol building Monday hoping to persuade the state Senate to approve Gov. O'Malley's 2012 offshore wind energy proposal. CREDIT: Chesapeake Climate Action Network

O’Malley strengthened his support from clean tech-minded lawmakers in Maryland’s House of Delegates led by Tom Hucker, D-Silver Spring. Today (Friday) Hucker led the charge in passing House Bill 441.

At the start of 2012, O’Malley’s new proposal set the cost cap at 2.5% for businesses. The House Bill 441 has cut it to 1.5% with special considerations for farmers and industrial energy users. The cap on price increases for the “average” household would be $1.50 per month. This is no small difference because wind project developers need to be able to charge higher prices for electricity to earn a satisfactory return on their investment.

Now the sales pitch turns to the often more skeptical Maryland Senate, beginning with its Finance Committee. Senate Majority Leader Robert J. Garagiola, a Montgomery County Democrat and Finance Committee member, said this week he thinks he and supporters of Senate Bill 237 are currently one vote short of passage on the 11-member committee.

Sensing this may be the best — and perhaps last shot — at wind energy off Maryland’s small share of the Mid-Atlantic coast, supporters of many stripes are organizing a “Circle of Support” around the state Capitol in Annapolis Monday, April 2.

O’Malley Administration officials project that a 310-megawatt offshore wind project could support 1,300 manufacturing and construction jobs to build it and 250 permanent jobs maintaining and running the turbines afterward.  O’Malley asserts that Maryland imports nearly 40 percent of the electricity its residents and businesses use, while paying millions in extra charges because of bottlenecks in the regional PJM power transmission network.

If O’Malley’s “Maryland Offshore Wind Energy Act of 2012″ fails in these the closing days of the 2012 legislative session, it will likely be a very long time — if ever — before turbines are generating electricity anywhere along the Mid-Atlantic coast.

Earlier this year, the Bluewater Wind project off the coast of Delaware lost the active support of its principal backer, NRG Energy, leaving that state’s efforts up in the air. Without a project in either Maryland, New Jersey or Delaware, Cape Wind Associates in Massachusetts would be in lone pursuit of the elusive distinction of wind-generated electricity in state or U.S. waters. With a federal lease and power purchase contract in hand, developers there hope to begin construction in 2013 in Nantucket Sound.

Commercial scale offshore wind systems have been operating in Europe since 1991. An estimated 3,160 MW of capacity are currently operating worldwide.

Posted in Clean energy, Clean tech, Costs of energy, Green jobs, Green power, Offshore renewable energy credits, Offshore wind, Renewable energy, Wind energy | Tagged , , , , , , , , , , , , , , , ,

FAST FIX: single biggest emitter of CO2 in the U.S.? Scherer coal plant in Georgia

Written by Jim Pierobon on March 28, 2012 — Leave a Comment

The Robert W. Scherer coal complex in Juliette, Georgia includes four 880-megawatt boilers. CREDIT: Wikimedia Commons

The Scherer complex of four coal-burning power plants near Macon, GA, co-owned and operated by Georgia Power, is the single largest emitter of carbon dioxide in the United States, according to the U.S. Environmental Protection Agency. It spewed almost 23 million tons of CO2 in 2010.

According to Natural History magazine, it ranked as the 20th in the world in terms of carbon dioxide emissions by the Center for Global Development on its list of global power plants in November 2007. It was the only power plant in the United States that was listed in the world’s top 25 CO2 producers.

Other owners of the complex are Georgia Power’s sister company Gulf Power; the city of Dalton, Georgia; Florida Power & Light; the Jacksonville Electric Authority in Florida; the Municipal Electric League of Georgia and Oglethorpe Power, also in Georgia.

Its two 1,000-foot chimneys and four cooling towers are not hard to see on a clear day from commercial jetliners headed into and out of Atlanta’s Hartsfield Airport. Don’t confuse the cooling towers with Georgia Power’s nuclear power stations, which have similar-looking cooling towers.

Posted in Coal, Fast Fixes, Fossil fuels, U.S. EPA | Tagged , , , , , , , , ,

Capturing carbon and selling it: Marc Gunther’s e-book is both inspiring and a reality-check

Written by Jim Pierobon on March 26, 2012 — Leave a Comment

Author Marc Gunther has a new e-book — Suck It Up — that does an excellent job of spotlighting and explaining technologies with the potential for capturing carbon dioxide in the air and selling it to end-users who need more of it.

Marc Gunther's new e-book can be had on Amazon for a 'whopping' $1.99. CREDIT: Marc Gunther

Because CO2 exists everywhere in the atmosphere, one trick to building a sustainable business is to site the capture system close to the end-user markets. One such market that exists in spades right now is underground injection to enhance oil recovery.

While underground injection of CO2 produces more hydrocarbons (bad) the ability to score a net reduction in carbon in the atmosphere could be THE holy grail of climate change (very good). Even naysayers would find it difficult to credibly oppose this economic opportunity, with or without a carbon tax or cap and trade system, although either would help.

The technologies that seem to harbor the most additional funding potential and real-world scalability are among the 11 finalists for the Virgin Earth Challenge created by Sir Richard Branson and Al Gore. It aims to award $25 million to whomever can devise a “commercially viable design” that can achieve a “net removal” of anthropogenic, atmosphere gases to materially stabilize the Earth’s climate.

The three companies linked below are working hard to connect the dots. Gunther provides just enough context and background on each. And he does so in the equivalent of about 50 pages in length of a quality paperback book. At $1.99 for your iPad or Kindle, it’s a no-brainer to buy, read and understand how close we’re getting, or not, to capturing carbon.

Carbon Engineering’s business model in my view appears to stand the best chance of getting traction. It’s based on what founder David Keith describes as “physical carbon arbitrage”: build carbon-capture plants in places where there is cheap natural gas (e.g. close to today’s prices in the U.S. of about $2.50-$3 per million cubic feet), low-cost labor, land and construction costs combined with strong demand for CO2.

If it were only that easy.

Work on “negative emissions technologies” is nothing new. Companies around the world are busy with their own R&D. You’ll read about them in the book, along with the scientists who doubt any such approach can work.

You’ll also see widely different estimates of the projected costs of capturing and selling a ton of carbon dioxide: for a little as $50 to $200 a ton all the way up to $1,000 a ton.

Gunther shares a perspective that many professionals concerned about climate change join him in expressing: there’s a moral hazard in even talking about air capture because carbon emitters will be less likely to reduce emissions now if they believe that the problem can be pushed down the road.

Let’s hope not.

Posted in Cap and trade, Carbon capture, Clean energy, Clean energy finance, Clean tech, Climate change, Climate policy, Coal, Emissions from power plants, Energy policy, Global warming, Greenhouse gas emissions, Innovation | Tagged , , , ,

Green Button approaching critical mass – 27 million households now getting access to their energy data

Written by Jim Pierobon on March 23, 2012 — 1 Comment

NOW, we’re getting somewhere with the Green Button Initiative.

Nine investor-owned utilities from across the country have jumped on board enabling an updated total of about 27 million households to access their electricity usage data. This is a huge step forward for motivated consumers to better understand how they can save on their energy bills and then share their experiences with friends and neighbors.

Just last week I blogged about the White House’s head-scratching silence after the Green Button launch in January. Well it turns out the utilities listed below now are helping the Green Button achieve critical mass.

Silver Springs Networks digital meters like this one are due to be installed throughout Pepco's Maryland, Delaware and Washington, DC service territories by year-end 2012. Customers' access to their energy usage data should activated by Spring 2013. CREDIT: The Energy Fix

Customers of utilities not on board deserve an explanation why their energy providers have yet to enable access or make a public commitment to do so. Is there such a thing as peer pressure among energy utilities? We’re about to find out.

The utilities new to the Green Button, as it turns out, could not announce their decisions until President Obama and the White House did so first as part of his ‘all-of-the-above-energy’ campaign appearances Thursday.

  • American Electric Power, serving 5.3 million customers in 11 states (Arkansas, Indiana, Kentucky, Louisiana, Michigan, Ohio, Oklahoma, Tennessee, Texas, Virginia, West Virginia);
  • Austin Energy, 400,000 customers in the Texas capital;
  • Baltimore Gas & Electric, 1.2 million customers in Maryland;
  • CenterPoint Energy, 1.8 million households in Texas;
  • Commonwealth Edison, 3.4 million households in Illinois;
  • Dominion Power, 2.4 million customers in Virginia and North Carolina;
  • NSTAR, 1.1 million households in Massachusetts;
  • PECO, 1.4 million households in Pennsylvania; and
  • Reliant, 500,000 households in Texas.

These utilities join Pacific Gas & Electric, Southern California Edison and San Diego Gas & Electric for moving quickly on the challenge posed by the White House late last year. There still is no word to be found to back up previous commitments made by Oncor in Texas, Glendale Water and Power in southern California and Pepco Holdings in Washington, DC, Maryland and Delaware.

At a “powering the people 2.0″ conference run by The Edison Foundation and the Institute for Electric Efficiency March 22 in Washington, Marcus Beal, Senior Project Manager at Pepco Holdings, told The Energy Fix Pepco is on track to complete the installation of smart meters throughout its service territories by year-end 2012. Activation of all smart meters is due finish by the second quarter of 2013.

With the Green Button now gaining sustainable momentum, the onus is not only on utilities yet to engage but the utility commissioners who may bear even more responsibility for the lack of adoption.

Cameron Brooks, Vice President, Policy at Tendril, one of the growing number of data-sharing platform providers, is focused sharply on educating and cajoling utility commissioners to get on board. He is quick to remind anyone who will listen that Title XIII of the Energy Independence and Security Act of 2007 signed into law by then-President George W. Bush got the ball rolling on this. So it’s been about five years since utilities and their commissions SHOULD have gotten the message.

Brooks explained to The Energy Fix, that utility Chief Information Officers are seeing with their own eyes and deployments how relatively simple and inexpensive energy data sharing can be once digital meters have been installed and activated. Share this video summarizing his message to utility commissioners here.

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