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New Site

Thanks for visiting my blog.

I have now officially transitioned my site to http://www.globalenergymatters.com/

I hope to “see” you all there!

Categories: Uncategorized

Smart Meters from the Golden to the Lone Star State

May 31, 2011 2 comments

Smart meters are being installed throughout the United States as a part of the process of modernizing the nation’s electric grid. Two major players in the smart meter installation game are California and Texas. Check out two smart meter commercials from these two (very different?) states:

The Golden State of California

Texas – The Lone Star State

 

Chinese Coal Plants Face Bankruptcy – Woes of the Regulated Utility

According to a recent article by Industrial Fuels and Power, 87of China’s coal-fired power plants could face bankruptcy as a result of disagreements between state-owned utilities and government economic planners. These plants, which represent 20% of China’s coal fleet, are struggling to survive as high demand (and resulting high coal prices) collides with government mandated electricity prices aimed to keep economic development on a positive trajectory through cheap electricity.

In regulated electricity markets, the price of electricity is set by government entities instead of the utilities themselves. These prices are established by a combination of factors including predictions on fuel prices and any capital investments made for power plant infrastructure. To request an increase in the price of electricity, utilities make a rate case – an argument for charging a certain amount of money for power – that outlines their expenses (and predicted increase in costs). Governing authorities then approve a price for electricity, which the consumer pays.

This regulated structure has pros and cons. It benefits utilities by providing an effective guaranteed rate fo return on their investments while eliminating price gouging for areas with few electricity providers. But, at the same time this structure can lead to problems when government priorities – such as keeping prices low without subsidies – conflict with market realities such as fuel price spikes and necessary plant maintenance and upgrades. This is the problem facing Chinese coal plants.

The Chinese government wants to keep electricity costs low as a party of the country’s economic development strategy. Cheap energy means cheap goods – a backbone of China’s success in exporting goods through the world’s markets.

So, what can be done when the government wishes to keep electricity prices low in the face of rising costs for producing that electricity?

In the short-term – subsidies can be made, robbing Peter to pay Paul. Funds can be shifted from other sources (for examples through taxes on consumer goods) to keep power plants in the black, while maintaining low utility bills for China’s residents. But, in the long-term, this could quickly prove to be an unsustainable strategy if power plant expenses continue to rise.

For now – China’s coal fleet is curtailing electricity generation in order to reduce the amount of coal that they burn, hoping that fuel prices will drop. This stop-gap measure will (hopefully) keep the doors open and the generators running until a compromise can be struck between utilities and the government’s economic planners.

[HT to Chad Blevins for sending me the article that inspired this post]

The Winds of Change are Blowing in West Texas

This video was released in 2007 on CBS Sunday Morning News, but it still speaks today – when more than 10,000 MW of wind power has been installed in Texas. A wind boom that doesn’t seem to be slowing down.

A transcript from this video can be found here.

The Fracking Debate – The “Truth” about Gasland and water contamination

May 25, 2011 1 comment

One of the major concerns with regards to hydraulic fracturing is the potential for fracking fluids – specifically, the chemicals in them – to contaminate drinking water. The YouTube video titled “My Water’s on Fire Tonight” outlined this concern:

But there’s more in the water than just H2O
Toxic chemicals help to make the fluid flow
With names like benzene and formaldehyde
You better keep ‘em far away from the water supply

The drillers say the fissures are a mile below
The groundwater pumped into American homes
But don’t tell it to the residents of Sublette Wy-O
That water’s fracked…. We’re talking Benzene…

It is believed that there have been thousands of cases of groundwater contamination in the United States due to this fracking process. But, there is some debate on the validity of these claims. On May 13, Jamie L. Vernon, PhD wrote a post about the pro- and anti-fracking debate for Discover Magazine’s blog, The Intersection where he brought to light doubts surrounding claims of groundwater contamination. In his opinion:

…this is a hilarious production designed to draw attention to the fracking debate.  To be clear, my biggest concerns are not centered on the hydraulic fracturing fluid per se.  I feel the recent PNAS paper highlighted the much more worrisome problem of methane gas leakage.  In fact, the PNAS paper stated that there was no evidence of contamination of drinking water with deep saline brine or fracking fluids.

To be clear, this PNAS paper does not say that water contamination is not a potential problem with the fracking process. Instead, it indicates that recent claims of groundwater contamination in the United States might have been overstated.

Regardless of the validity of the water contamination claims, this concerns has captured American’s attention. Some of this success could be rooted in the success of the “Gasland”  documentary by Josh Fox. This movie focuses on the use of hydraulic fracturing to unlock natural gas stored in shale (rock) underground, and the potential negative environmental impacts of using this technology. But, it’s main anti-fracking argument centers on the potential for fracking to contaminate drinking water supplies, painting a highly negative picture for viewers.

Unsurprisingly, this documentary has received negative press and backlash from organizations including the organization called America’s Natural Gas Alliance (ANGA), a pro-natural gas association that promotes the use of natural gas in the United States.  In response to the Gasland documentary, ANGA supported the released of a short video – titled “The Truth About Gasland” – that puts a call out for “open, factual and fair dialogue” surrounding the development of the nation’s natural gas resources. In this video, the creators state that “the film “Gasland,” whatever the intentions of the filmmaker, has contributed to a dialogue based more on fear than facts. While it is a dramatic movie, ‘Gasland’ is a deeply flawed documentary that gets several important facts wrong. Learn more at http://ANGA.us/truthaboutgasland

The Hydraulic Fracturing Debate (pt 1) – “My Water’s on Fire Tonight”

Hydraulic fracturing – fracking – is a process that can be used to extract natural gas from rock (shale) underground. In this process water, sand and chemicals are injected into the ground to crack the rocks containing the natural gas.

A recent YouTube video discusses some of the major arguments for and against the use of hydraulic fracturing in a – shall we say – less conventional format. This rap, titled “My Water’s on Fire Tonight,” attempts to bring attention to the current debate on the risks v. rewards of using this process in the United States. Drawing from concerns also raised in a National Academy of Science paper released last month, this video emphasizes the dangers from increased potential of methane gas leaks with hydraulic fracturing.

“My Water’s on Fire Tonight” lyrics:

Fracking is a form of natural gas drilling
An alternative to oil cause the oil kept spilling
Bringing jobs to small towns so everybody’s willing
People turn on their lights and the drillers make a killing

Water goes into the pipe, the pipe into the ground
The pressure creates fissures 7,000 feet down
The cracks release the gas that powers your town
That well is fracked….. Yeah totally fracked

But there’s more in the water than just H2O
Toxic chemicals help to make the fluid flow
With names like benzene and formaldehyde
You better keep ‘em far away from the water supply

The drillers say the fissures are a mile below
The groundwater pumped into American homes
But don’t tell it to the residents of Sublette Wy-O
That water’s fracked…. We’re talking Benzene…

What the frack is going on with all this fracking going on
I think we need some facts to come to light
I know we want our energy but nothing ever comes for free
I think my water’s on fire tonight

So it all goes back to 2005
Bush said gas drillers didn’t have to comply
with the Safe Drinking Water Act, before too long
It was “frack, baby, frack” until the break of dawn.

With the EPA out it was up to the states
But they didn’t have the money to investigate
Sick people couldn’t prove fracking was to blame
All the while water wells were going up in flames

Cause it’s hard to contain all the methane released
It can get into the air, it can get into the streams.
It’s a greenhouse gas, worse than CO2
Fracking done wrong could lead to climate change too

Now it’s not that drillers should never be fracking
But the current regulation is severely lacking
Reduce the toxins, contain the gas and wastewater
And the people won’t get sick and the planet won’t get hotter

What the frack is going on with all this fracking going on
I think we need some facts to come to light
I know we want our energy but nothing ever comes for free
I think my water’s on fire tonight

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