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Edge of Energy

Discovery of Natural Gas Reserves in Israel is a World-class Game Changer

June 14th 2010

Israel Topics - Leviathan Oil field 2
Leviathan natural gas field rig

A  door has been closed. But amid the roar, the creak of an opening window was faintly audible. This window, a gigantic deposit of natural gas called Leviathan, 6.5 times the size of Tel Aviv, was found, roughly 100 nautical miles from where the flotilla fiasco took place and well within Israel's extended territorial waters.

An old adage says that when God closes a door, somewhere he opens a window. To most people, last week's events off the coast of Gaza marked a sharp decline in Israel's strategic posture. The Mavi Marmara incident sparked international condemnation and delivered what may have been a death blow to Jerusalem's already precarious relations with Turkey. For decades that country was Israel's closest ally in the Muslim world, but since the election of Recep Tayyip Erdogan, it is increasingly in the thrall of fundamentalist Islam.

A door has been closed. But amid the roar, the creak of an opening window was faintly audible. This window, a gigantic deposit of natural gas called Leviathan, 6.5 times the size of Tel Aviv, was found, roughly 100 nautical miles from where the flotilla fiasco took place and well within Israel's extended territorial waters. This discovery may provide Israel with security in terms of its supply of electricity, turn it into an important natural gas exporter and provide a shot in the arm of some $300 billion over the life of the field - one-and-a-half times the national GDP - to the Israeli economy, already one of the most resilient in the world. Read more ..

Iran's Nukes

How Brazilian Ethanol Could Help Iran Outwit American Sanctions

June 7th 2010

Contributors / Staff - Gal Luft

Brazilian President Luiz Inacio Lula da Silva has been spending a lot of time with his Iranian counterpart Mahmoud Ahmadinejad lately, to the consternation of the former's supporters at home and friends elsewhere in the West. Brazil, currently a member of the U.N. Security Council, has been unapologetic about its newfound relationship with Iran, which produced a dubious nuclear fuel-swap deal last month; it defends Iran's right to enrich uranium and rejects any idea of tough economic sanctions. The budding friendship has baffled Washington: Why would this Latin American country, otherwise a U.S. ally, insist on cozying up to Iran to the detriment of its relations closer to home?

There are several possible explanations. Brazil has long harbored its own nuclear aspirations, and increasingly seeks to define its own foreign policy and emerge as an independent global power. But Lula's motives may be less complicated than all that: There are also $10 billion in Brazilian-Iranian trade deals to be had. Perhaps the most intriguing, and strategic, aspect of those trade relations has to do with sugar.

Brazil is the world's largest sugar grower. This year it experienced a bumper crop, with output growing 16 percent from a year earlier. But due to a global glut, sugar prices have plunged 57 percent since February. Because sugar cane is a perishable crop that cannot be stored, the best way for Brazil to generate value from its undervalued surplus is by converting it into ethanol, of which Brazil is already the second-largest producer (after the United States) and a major consumer (for years Brazilians have driven mostly flex-fuel cars, which can run on any combination of gasoline and ethanol). The country's ethanol production is expected to rise 19 percent to 8 billion gallons this year. Read more ..

The BP Spill

Congress Assails BP for Vested Interest in Minimizing Damage

May 31st 2010

Energy Topics - Gulf oil spill

A top White House official and a senior Democrat on Sunday attacked BP for downplaying the amount of oil flowing into the Gulf of Mexico, accusing the oil giant of protecting its financial interests in low-balling the gusher’s size. The tough line with the company comes a day after BP and federal officials abandoned the “top kill” effort to block the damaged well.

“It is important to understand that BP has a financial interest in what those flow rates are. They will ultimately pay a fine based on those rates,” said Carol Browner, the White House climate and energy adviser, on CBS’s “Face the Nation.”

“It is important for people to understand [that] BP has a vested financial interest in downplaying the size of this,” Browner later added. “We are on top of it. We have the best minds looking at it.” Read more ..

The BP Spill

Criminal Probe of BP Suggested

May 24th 2010

Energy / Environment - BP Execs Testify

A group of Senate Democrats is pressing the Obama administration to escalate its probe of the Gulf of Mexico oil spill by launching a criminal investigation of BP. Eight members of the Environment and Public Works Committee in a letter Monday to Attorney General Eric Holder asked him to explore whether BP made “false and misleading statements to the federal government regarding its ability to respond to oil spills in the Gulf of Mexico.” The letter points to an exploration plan that BP provided Interior Department regulators in February of 2009 that addresses the company’s ability to respond to a spill. Read more ..

The BP Spill

Training Exercises Showed Gaps in Government Preparedness Before BP Oil Spill

May 17th 2010

Energy / Environment - Oil Spill Cleanup Crew

Over the last eight years, the U.S. government has conducted four major drills to prepare for a massive oil spill, the results of which foreshadowed many of the weaknesses in coordination, communication, expertise, and technology that have plagued the federal response to the BP disaster in the Gulf of Mexico.

According to interviews and after-action reports, the training exercises conducted in 2002, 2004, 2007, and just this past March caused federal officials to express concern about a host of issues. Most prominent among them:

  • coordination and communication between the Coast Guard and the Department of Homeland Security, especially involving the process for naming a National Incident Commander (NIC) to take charge of the crisis;
  • a slow or inaccurate flow of information from the industry, particularly caused by companies' desire to protect proprietary information and officials' tendency to exclude industry representatives from the government's command center; and
  • a lack of expertise and modern technology for closing a spewing oil well leak and containing a slick through controlled burns and dispersants.

Since then, the government has faced questions about why it took so long to declare the spill an emergency, why it didn’t use Pentagon planes sooner to spray dispersants and why it lacked a ready supply of specialized booms to contain and burn the growing oil slick. Read more ..

The Edge of Oil

OSHA Says 97% of Worst Industry Violations Found at BP Refineries

May 17th 2010

Energy / Environment - BP Refinery Explosion
BP's Renegade Refinery after Explosion

Two refineries owned by oil giant BP account for 97 percent of all flagrant violations found in the refining industry by government safety inspectors over the past three years, a Center for Public Integrity analysis shows. Most of BP’s citations were classified as “egregious willful” by the Occupational Safety and Health Administration and reflect alleged violations of a rule designed to prevent catastrophic events at refineries.

BP is battling a massive oil well spill in the Gulf of Mexico after an April 20 platform blast that killed 11 workers. But the firm has been under intense OSHA scrutiny since its refinery in Texas City, Texas, exploded in March 2005, killing 15 workers. While continuing its probe in Texas City, OSHA launched a nationwide refinery inspection program in June 2007 in response to a series of fires, explosions, and chemical releases throughout the industry. Read more ..

Edge of Oil

Oil Spills—Large and Small—Create Continuing Disaster

May 10th 2010

This continuing coverage of America’s oil crisis arises from the The Plan: How to Save America When the Oil Stops—or the Day Before (Dialog Press). Buy it here.

Environmental damage caused by the petroleum industry and its consumers is earth-shattering, literally. The world focus is now on BP’s massive, out-of-control underwater gusher in the Gulf of Mexico. Estimates of that oil pollution telescope across the numbers. Many sources estimate as much as 5,000 barrels per day are escaping into the Gulf. Other experts say the true number is closer to 1.1 million gallons—approximately 26,500 barrels— per day. A barrel of crude equals about 42 gallons. It is all evolving guesswork based on a cascade of satellite images and thickness estimates derived from visual descriptions of the slick. At press time, at least 4 million gallons—or as many as 21 million gallons—have thus far spilled, and the spill clock is rapidly racing forward.

Thus far, the media is comparing this current disaster to the Exxon Valdez event. The Exxon Valdez spilled 10.8 million gallons into Alaska’s Prince William Sound in March 1989, devastating the shore along with the area’s sea life, birds, and furry animals. Oil spills such as that of the Exxon Valdez inflict severe local ecological disasters where they occur. The Exxon Valdez incident is famous, but is hardly the largest spill in recent years.

Saddam Hussein’s intentional destruction of Kuwaiti oil wells caused 24 million to 60 million gallons of crude to gush into the Persian Gulf. But the largest spill on record is from Pemex’s Ixtoc I. From June 3, 1979, until it was capped forty-two weeks later, Ixtoc I dumped an estimated 151.2 million gallons of crude into the Gulf of Mexico, most of which floated toward the Texas coastline. Read more ..

Edge on Energy

Energy Subsidies are Worse than a Waste of Money

May 3rd 2010

Energy Topics - Oil Barrels 400px

A comprehensive assessment of global fossil-fuel subsidies has found that governments are spending $500 billion annually on policies that undermine energy security and worsen the environment.

The study, titled "The Politics of Fossil-Fuel Subsidies" by David Victor, a professor of political science with UC San Diego's School of International Relations and Pacific Studies (IR/PS), was one of five released by the Global Subsidies Initiative (GSI) of the International Institute for Sustainable Development (IISD).

GSI's goal is to reform, reduce and ultimately eliminate fossil-fuel subsidies, which are highest in Iran, Russia, China, Saudi Arabia, India and Venezuela. The reform effort received a boost September 2009 when President Obama and other world leaders met in Pittsburgh, Pa., for the Group of 20 Summit. They agreed in a non-binding resolution to phase out fossil-fuel subsidies, but the measure didn't attempt to resolve difficult political issues such as how governments would actually achieve a phaseout. Victor's study addresses the political challenges. Read more ..

Energy Politics

Ukrainian President Stands to Gain from "Gas for Fleet" Agreement With Russians

April 26th 2010

Russian Topics - Black Sea fleet
Russian Black Sea Fleet

Ukrainian President Viktor Yanukovich stands to gain from “the gas for fleet” agreement under which he agreed to allow Russia’s Black Sea Fleet to remain in Sevastopol until 2042 in exchange for Russian President Dmitry Medvedev’s reduction of gas prices for Ukrainian customers, even if the the Ukranian Parliament, the Verhovna Rada, refuses to ratify it.

That is because, Vladimir Pribylovsky of Moscow’s Panorama Center says, “Yanukovich needs to strengthen the opinion of voters about himself, to build up his image which he offered in the recent presidential elections,” all the more so because there may soon be elections for the Rada “and [he] needs to retain these voters.” Read more ..

The Edge of Coal

Democrats Pressure Coal Execs to Drop Opposition to Climate Legislation

April 19th 2010

Energy Topics - Coal Train

House Democrats on Wednesday pressured coal company executives to drop opposition to climate legislation at a hearing that also briefly touched on safety issues following the explosion last week that killed 29 miners.

Rep. Edward Markey (D-Mass.), the chairman of the House Select Committee on Energy Independence and Global Warming, urged executives from Peabody Energy, Arch Coal and Rio Tinto to “cease efforts to deny the science of global warming” and stop “misleading the public as to the true science behind climate change.”

The focus of the committee’s hearing was the future of coal, but Markey also asked the executives if the number of safety violations reported at the Upper Big Branch mine in West Virginia prior to the blast was unusually high.

Markey said the mine had received more than 1,300 citations for safety violations from the U.S. Mine Safety and Health Administration since 2005.

The executives said the citations at the mine seemed high, but added the type of mining done there posed hazards different from those of other mines. The executives all said the safety of miners was a priority for the industry. Officials from Massey Energy, which owns the Upper Big Branch mine, did not attend Wednesday’s hearing. Read more ..

The Edge of Wind

Proposed Electric Grid Could Make Wind Power More Reliable

April 12th 2010

Energy Topics - Wind Turbine

The energy needs of the entire human population could potentially be met by converting wind energy to electricity. While offshore wind power resources are abundant, wind turbines are currently unable to provide steady power due to natural fluctuations in wind direction and strength. Steady is the key word.

Offshore wind power output can be made more consistent by choosing project development locations that take advantage of regional weather patterns and by connecting wind power generators with a shared power line, according to a paper by researchers from the University of Delaware and Stony Brook University published in the Proceedings of the National Academy of Sciences.

“Making wind-generated electricity more steady will enable wind power to become a much larger fraction of our electric sources,” said the paper's lead author Willett Kempton, University of Delaware professor of marine policy in the College of Earth, Ocean, and Environment and director of its Center for Carbon-free Power Integration.

The researchers analyzed five years of wind observations from 11 monitoring stations along the U.S. east coast from Florida to Maine. Based on wind speeds at each location, they estimated electrical power output from a hypothetical five-megawatt offshore turbine. After analyzing the patterns of wind energy among the stations along the coast, the team explored the seasonal effects on power output. Read more ..

The Race for Oil and Gas

Polarizing the North Pole and its Energy Riches

April 5th 2010

Energy / Environment - North Pole
The North Pole

Throughout human history, the Arctic has had little trouble retaining its reputation for austere beauty. However as the irreversible effects of global climate change continue to negatively impact ecosystems worldwide, the once ice blanketed region is rapidly melting away. This climatic shift has caused unexpected political tension between several northern nations.

At the same time, according to the United States Geological Survey (USGS) as much as 90 billion barrels of oil and 1,670 trillion cubic feet of natural gas may be available for extraction beneath the ice barrier. The United States, Canada, Norway, and Russia are at odds as they compete for access to the potential wealth.

When American politicians debate drilling in the Arctic National Wildlife Refuge, they must realize that the 7.7 billion barrels of oil and the 3.5 trillion cubic feet of natural gas to be found there pales in comparison to what the Arctic almost certainly has to offer. In a world where large energy consumers are scrambling for every last drop of oil they can find and energy resource exporters desire to maintain their hegemony on the political-economic ladder, any source of oil is worth pursuing, no matter how high the cost of extraction. Read more ..

The Race for Alt-Fuel

Global Ethanol Tops 85 Billion Liters as OPEC Complains

March 29th 2010

Science - Jatropha Plantation
Jatropha plantation

Global ethanol production will top 85 billion liters this year. The 2010 forecast predicts a 16 percent increase in global production over 2009 actual production despite a very challenging year for the industry, particularly in the United States, where the industry experienced margins squeezed by low fuel prices and higher than normal feedstock prices.

Despite this difficult year, the United States continues to lead the world in ethanol production and will produce over 45 billion liters of the world’s output this year. The U.S. growth in production continues to be driven in large part by federal laws requiring mandated blending and a Congress obsessed with energy security and energy policy. Rules outlining the so-called “RFS2” were released last month providing for a 36 billion gallon market in the U.S. by 2022.

Not all jurisdictions had an easy time in 2009 convincing governments to adopt biofuels-friendly policies. Europe continues to twist itself into knots over sustainability issues being trumpeted by powerful NGOs on the continent. While the European Commission has mapped out an aggressive plan for growth in biofuels, details of the plan are bogged down in debate over how to measure the green house gas benefits from these new fuels. Despite these apparent challenges there will be modest growth in ethanol output in Europe this year. Read more ..

The Metal's Edge

Renewable Energy Begins at the Mine

March 22nd 2010

Latin American Topics - Bolivian miner

Despite the recent failure of the Copenhagen climate summit to produce a binding treaty for greenhouse gas reduction, in the coming years the share of renewable energy in our energy portfolio is expected to grow significantly. But as the world moves away from fossil fuels, industrial minerals like lithium, cobalt, indium, gallium, tellurium, vanadium, and chromium, to name a few, are becoming increasingly strategic and failure to ensure their supply could not only strip the green revolution of any meaningful content but also create unnecessary national security vulnerabilities for the U.S.
The compact energy-efficient fluorescent light bulbs we will be forced to use since Congress has essentially banned incandescent light bulbs require for their manufacturing europium, cerium, terbium, and yttrium. All four belong to the group of 15 successive metals on the periodic table called rare earth elements, which are also employed in hundreds of technologies and from Blackberries to radars and precision guided bombs. One member of this family, Lanthanum, is a critical element in the production of nickel metal hydride batteries currently used in hybrid cars and electric scooters. Another member, Neodymium, is essential for the production of magnets used in electric car motors as well as in the electric generators of large wind turbines. The magnet utilizing generator of one wind turbine could take as much as half a ton of neodymium.

This is a lot considering that global Neodymium production in 2008 stood at 17,000 tons, most of it used in critical applications like computer drives, mobile phones, MRI machines, fuel cracking catalysts, glass and air conditioners. Cadmium, copper, indium, gallium, selenium, and tellurium are all used in thin-film photovoltaic solar panels. Advanced auto batteries all contain scores of other metals including cobalt, lithium, manganese and nickel. The lithium requirement of President Obama’s plan for the auto industry to deploy one million plug-in hybrids by 2015 is equivalent to the current needs of the global battery market for portable electronics including power tools, cell phones and computers. Read more ..

Oil's Edge

Sexual Predators Increase in Energy Boomtowns

March 15th 2010

Crime Topics - Man in Handcuffs

“Social dysfunction and biological impoverishment” are just some of the social and environmental effects on communities that are economically dependent on oil and gas industries, according to new research.

The findings, published in Conservation Biology, revealed that over a nine year period, the number of registered sex offenders in energy “boomtowns” was two to three times higher than towns dependent on other industries.

The research, carried out by Dr Joel Berger and Dr Jon P. Beckmann, analyzed communities in the Greater Yellowstone Ecosystem (GYE) in Wyoming USA, an area often referred to as the largest intact ecosystem in Earth's temperate zone. Many towns across the area are dependent on energy extraction, while others are dependent on agriculture and tourism. The authors assessed whether social and environmental issues are related to the industries that dominate these boomtowns. Read more ..

Nano Edge

Nanotechnology Creates Energy Storage on Paper and Cloth

March 8th 2010

Social Topics - Paper Stack

By dipping ordinary paper or fabric in a special ink infused with nanoparticles, Stanford engineer Yi Cui has found a way to cheaply and efficiently manufacture lightweight paper batteries and supercapacitors (which, like batteries, store energy, but by electrostatic rather than chemical means), as well as stretchable, conductive textiles known as "eTextiles" – capable of storing energy while retaining the mechanical properties of ordinary paper or fabric.

While the technology is still new, Cui's team has envisioned numerous functional uses for their inventions. Homes of the future could one day be lined with energy-storing wallpaper. Gadget lovers would be able to charge their portable appliances on the go, simply plugging them into an outlet woven into their T-shirts. Energy textiles might also be used to create moving-display apparel, reactive high-performance sportswear and wearable power for a soldier's battle gear. Read more ..

The Race for Hydrogen

Bloom Energy Server Offers Out-Of-This-World Promises

March 1st 2010

Energy Topics - Bloom Energy

The recent installment of CBS Television’s 60 Minutes presented a story that couldn’t have been more astonishing and unexpected than if Lesley Stahl announced that a UFO landed in her backyard and that the emerging alien-being presented her with a little black box that would end all of Earth’s electrical energy problems.
It was with that amount of surprise that Ms. Stahl first introduced to the general public a Silicon Valley company named Bloom Energy along with its principal founder and CEO, KR Sridhar. The little black box, which Mr. Sridhar prefers to call a “Bloom Energy Server” is a stand-alone electric generator that requires no connection to any centralized power generating plant and no coal-based or oil-based fuel to operate it. It also produces no offending noises or harmful emissions. Read more ..

Electric Edge

Can Electric Cars Supply the Grid While Parked?

February 22nd 2010

Automotive - Plug-in Vehicle

Think of it as the end of cars' slacker days: No more sitting idle for hours in parking lots or garages racking up payments, but instead earning their keep by helping store power for the electricity grid.

"Cars sit most of the time," said Jeff Stein, a mechanical engineering professor at the University of Michigan. Stein added, "What if it could work for you while it sits there? If you could use a car for something more than just getting to work or going on a family vacation, it would be a whole different way to think about a vehicle, and a whole different way to think about the power grid, too." The University of Michigan is home of the Michigan Memorial Phoenix Energy Institute, which develops, coordinates and promotes multidisciplinary energy research and education at the Ann Arbor-based institution.

Stein leads a National Science Foundation-funded team exploring plug-in hybrid electric vehicles (PHEV) that not only use grid electricity to meet their power needs, but also the car's potential to store electricity from the wind or sun, or even feed electricity back into the grid, earning money for the owner. Read more ..

The Race for Bio-fuels

EPA Ruling Boosts Ethanol after Fierce Lobbying Effort for Corn-Based Fuels

February 15th 2010

Energy / Environment - Biofuel field

The Environmental Protection Agency (EPA) has just handed a victory to ethanol producers by issuing final regulations that conclude corn-based fuels will meet greenhouse gas standards imposed under a 2007 energy law.

The release of the final regulations follows a fierce campaign by ethanol companies that alleged 2009 draft rules unfairly found that large volumes of ethanol production would not meet targets in the statute for reducing greenhouse gases.

The new rules state that corn-based ethanol will meet a requirement of the 2007 law that they must emit at least 20 percent less in “lifecycle” greenhouse gas emissions than gasoline.

The statute expanded the national biofuels use mandate to reach 36 billion gallons annually by 2022. If the EPA had ruled that corn-based fuels did not meet their emissions target, the fuels could have been frozen out of the market.

The issue has been vital to the ethanol lobby, which feared that an adverse finding could stymie investment and tarnish the fuel’s image.

However, the nation’s current ethanol production — about 12 billion gallons annually — was exempted from the law’s emissions mandate. EPA Administrator Lisa Jackson on Monday denied the agency had bent to pressure, instead arguing that EPA employed better modeling when crafting the final regulations. “We have followed the science,” she told reporters on a conference call. “Our models have become more sophisticated. We have accrued better data.” Read more ..

The Edge of Oil

New Weapon Against Oil Spills

February 8th 2010

Energy / Environment - Oil Spill

An ultra-lightweight sponge made of clay and a bit of high-grade plastic draws oil out of contaminated water but leaves the water behind. And, lab tests show that oil absorbed can be squeezed back out for use.

Case Western Reserve University researchers who made the material, called an aerogel, believe it will effectively clean up spills of all kinds of oils and solvents on factory floors and roadways, rivers, and oceans.

The EPA estimates that 10 to 25 million gallons of oil are spilled annually in this country alone. Spilled oil ruins drinking water, is a fire and explosion hazard, damages farmland and beaches, and destroys wildlife and habitats. The harm can last decades.

The aerogel is made by mixing clay with a polymer and water in a blender, said David Schiraldi, chairman of the Macromolecular Science and Engineering department at the Case School of Engineering.

The mixture is then freeze-dried; air fills the gaps left by the loss of water. The resulting material is super light, comprised of about 96 percent air, 2 percent polymer and 2 percent clay. The oil-absorbing form is just one of a growing list of clay-based aerogels being made in Schiraldi's lab. By adding different polymers, they produce materials with different properties. Read more ..

The Race for Alt Fuel

Methane Hydrate Deposits May Provide Vast New Energy Source

February 1st 2010

Energy Topics - Methane Hydrate

Naturally occurring methane hydrate may represent an enormous source of methane, the main component of natural gas, and could ultimately augment conventional natural gas supplies, says a new congressionally mandated report from the National Research Council. Although a number of challenges require attention before commercial production can be realized, no technical challenges have been identified as insurmountable. Moreover, the U.S. Department of Energy's Methane Hydrate Research and Development Program has made considerable progress in the past five years toward understanding and developing methane hydrate as a possible energy resource.

"DOE's program and programs in the national and international research community provide increasing confidence from a technical standpoint that some commercial production of methane from methane hydrate could be achieved in the United States before 2025," said Charles Paull, chair of the committee that wrote the report, and senior scientist, Monterey Bay Aquarium Research Institute in California. "With global energy demand projected to increase, unconventional resources such as methane hydrate become important to consider as part of the future U.S. energy portfolio and could help provide more energy security for the United States."

Methane hydrate, a solid composed of methane and water, occurs in abundance on the world's continental margins and in permafrost regions, such as in the Gulf of Mexico and Alaska's North Slope. Although the total global volume of methane in methane hydrate is still debated, estimates yield figures that are significant compared with the global supplies of conventional natural gas. Read more ..

The Obama Edge

Energy Companies Face States Action for Actions on Climate Change Reform

January 25th 2010

Environment Topics - Smokestacks

Energy companies that have fought climate legislation in Congress are also facing threats in the states, where governors and legislatures are acting on their own to curb carbon dioxide emissions.

The latest example is a move by 11 governors from the Northeast and the Mid-Atlantic region to adopt a low-carbon fuel standard (LCFS) to reduce greenhouse gases from cars and trucks, and possibly home heating systems that use oil products.
Emissions from the transportation sector alone account for 30 percent of the carbon dioxide released in those states.

Greenhouse gas emissions from human activity pose “serious risks to human health, terrestrial and aquatic ecosystems and economies globally and in the Northeast and Mid-Atlantic region,” states a memorandum of understanding (MOU) the governors signed on Wednesday.

The goal is to develop a framework to reduce emissions from fuel use by 2011.

Oil companies and industry-backed groups argue there aren’t good alternatives to gasoline. Efforts to lower carbon dioxide emissions from fuel use in the Northeast won’t have an impact on global emissions and could raise energy prices in the region, critics say. Read more ..


A Double Dip Recession Looms as Oil Prices Rebound

January 18th 2010

Energy Topics - Oil Barrels 400px

In 2010, oil demand will resume its upward march. OPEC will respond by increasing supply—but the increase will come too late to keep prices down as emerging-market consumption pushes them up. In the extreme case, resurgent oil prices could drive the U.S. economy into a double-dip downturn. Here's what to expect, and what a limited oil supply will mean for the United States and the world.

As the global economy recovers, oil demand will continue to strengthen from the 85 million barrels per day that it hit in November. That's already 4 percent higher than it was at the recession's trough in May of last year. As a result, inventories both onshore and offshore have begun to decline. The number of tankers storing crude oil in the Gulf of Mexico, for example, fell to seven in October from a high of 22 in May. Read more ..

The Auto Edge

The Ultimate Driving Distraction: Electric Cars

January 11th 2010

Corporate Logos - Ford

This past week Ford Motor Company's president and CEO Alan Mulally gave the opening keynote speech at the 2010 Consumer Electronics Show in Las Vegas. The purpose of the presentation was to unveil an entire suite of new SYNC signature brand in-car innovations.

While the technology is undeniably exciting and amazing, it was darkly ironic given the amount of commotion that is currently going on around the country to try and eliminate “driving distractions.” If you think that the use of cell phones and texting has already created a safety problem, then you’re going to be shocked by what Ford now has in mind. Mr. Mulally actually seemed to champion and encourage the use of texting while driving when he rather gleefully announced that “Texting is now the favored form of communication for every age group,” within his description of Ford’s success in putting more than a million SYNC-equipped cars on American roads in 2009.

Incidentally, Ford wasn’t alone in exhibiting new “dashboard distractions” at CES; Kia showcased an elaborate Microsoft in-car multimedia system called UYO (which somehow stands for Your Voice), along with about 300 other in-vehicle exhibitors touting their own innovative products. Read more ..

Energy Politics

Senate Climate and Energy Bill Fight Expected Tough as Healthcare Reform

January 4th 2010

Environment Topics - Sao Paolo Pollution

Senate Democrats will face a problem when they return in January every bit as tough as crafting the healthcare bill: Assembling a climate and energy package that can be shoehorned into the election-year calendar.

Imposing limits on greenhouse gases is a White House and Democratic priority, but it’s stuck in line behind healthcare, Wall Street reform and jobs legislation.

It’s also become increasingly apparent since the Copenhagen climate summit that the Senate will go forward in a dramatically different direction than the House, which approved its own climate bill last summer.  Read more ..

Urban Transit

Bus Rapid Transit in Latin America--Successes But Miles to Go

December 28th 2009

Energy / Environment - Bogata Bus Line
Bogota Bus Rapid Transit

Over the past fifteen years, cities throughout Latin America have achieved a modest, yet significant revolution in urban design through the adoption and refinement of Bus Rapid Transit (BRT) systems. Promising the benefits of developed world transit systems at developing world prices, BRT has quickly become a popular policy initiative among national and municipal level Latin American policymakers charged with reducing the crippling congestion, choking pollution, and alarming accident rates characteristic of the largely unregulated bus transit systems in most cities throughout the region. Pioneered in the mid-sized Brazilian city of Curitiba in the 1970s, Bus Rapid Transit increased bus speeds and improved road safety by placing high-capacity buses within committed bus lanes which channel buses to a series of fixed stations, similar to light-rail or metro systems. Inspired by the success of Curitiba’s system, cities such as Bogotá and Quito have more recently made BRT the linchpin of their transit network, to considerable acclaim from the riding public and international observers alike. Read more ..

The Rail's Edge

The High-Speed Rail Gravy Train

December 21st 2009

Transportation Topics - Shinkansen bullet train

The U.S. High Speed Rail Association’s October conference opened like any large Washington gathering. The congressmen were seated in the front row. A powerhouse Beltway law firm laid out prints of its lobbyists’ biographies on a display table. And as the upscale J.W. Marriott meeting room went dark, a short film offered romantic visions of bullet trains in America’s future.

 As far back as 1965, planners, transportation experts, visionaries, and American train buffs — President Lyndon Johnson among them — have coveted the sort of sleek high-speed trains that crisscross much of Europe and Asia at speeds of more than 180 miles per hour. But after millions and millions of dollars spent studying, planning, and mostly falling short, the American incarnation of high-speed passenger rail is but a single line that travels from Washington to Boston at an average speed of under 80 miles per hour.

Now, though, the Obama administration is looking to change all that, starting with $8 billion in federal stimulus money to be awarded starting this winter. Equally captivated, Congress is considering adding as much as $4 billion more in next year’s budget. The House Transportation and Infrastructure Committee chairman, James Oberstar, a Minnesota Democrat, is talking $50 billion after that. Read more ..

Iran's Nukes

House to Take up Gas Sanctions on Iran

December 14th 2009

Iran - Iran Nuclear Equipment

The House is slated to vote in the coming days on bipartisan Iran sanctions legislation that targets companies supplying Iran with gasoline or helping the country expand its refining system. Iran is a major oil producer, but imports up to 40 percent of its gasoline because it lacks adequate refining capacity.

The plan is among several under consideration in Congress and the White House to pressure Iran over its nuclear program. The bill, sponsored by Foreign Affairs Committee Chairman Howard Berman (D-Calif.), has 343 co-sponsors. It would allow sanctions against companies that ship gasoline and other refined products to Iran, and also targets related services such as insurance and financing.

A bipartisan Iran sanctions package that the Senate Banking Committee unanimously approved in late October also targets the country's refined petroleum imports. However, the plans retain White House waiver authority that already applies to other energy sanctions under the Iran Sanctions Act of 1996. Read more ..


Icon or Omen? Dubai's Debt Problem and the Gulf

December 7th 2009

Arab Topics - Dubai aerial shot

Late on November 25, just before the start of the Islamic Eid festival and, coincidentally, Thanksgiving in the United States, Dubai's flagship investment company Dubai World announced that it would be requesting a six-month delay on paying its debts. Within hours, Dubai's reputation was being rewritten, and its ambition to be a financial center, building on its historic reputation as a focal point for regional trade, was being recast.

Uncertainty continued on November 30, when the Dubai government said that it would not guarantee Dubai World's debt. In any event, the larger story has been the nervousness of world financial markets, which are now also evincing worry about the debt of countries like Greece or Ireland. Within the Middle East, the focus is on the extent of support that Dubai will receive from Abu Dhabi, the neighboring -- and richer -- member sheikhdom of the United Arab Emirates (UAE), whether other city-states like Bahrain and Qatar are also at risk, and whether Dubai's links with Iran will change as a result of its financial situation. Read more ..

The Edge of Lithium

A Grey Goldmine: Lithium and Alt Energy in Bolivia

November 30th 2009

Latin American Topics - Bolivian Miner
Bolivian miner

According to Bolivian President Evo Morales, lithium is not only important to his country’s economic future but is “the hope of humanity,” as the lightweight metal efficiently stores energy capable of powering the eco-friendly cars of the future. Bolivia’s lithium reserves have made headlines in the past and once again currently. The country holds a total of 5.4 million tons of lithium, which is nearly half of the world’s known supply.

The Bolivian government now appears to be moving ahead with increasingly concrete plans for extraction and production of the metal. Experts from around the globe who recently gathered in Bolivia discussed new scientific findings and the possibilities herein contained.

Meanwhile, the U.S. and many other nations are preparing to meet in Copenhagen this December to discuss climate change and alternative energy policies. In order to understand recent developments in Bolivia’s lithium policy, it is necessary to examine new advancements in lithium technology, Morales’ overall policy of nationalization, alternative energy plans in the U.S. and Spain, and some of the concerns that have been raised.

New Lithium Technologies

According to the United States Geological Survey (USGS), one quarter of the lithium mined last year was used solely for lithium batteries, which operate portable electronic devices. The already rapidly increasing demand for lithium, the world’s lightest metal, which has a prodigious capacity for storing energy, is expected to rise dramatically as demand for electric cars, an alternative to gas-powered vehicles, are mass-produced and take to the roads. Read more ..

The Race for Alt-Fuel

International Expedition Investigates Climate Change, Alternative Fuels in Arctic

November 23rd 2009

Energy / Environment - USCG Polar Sea

Scientists from the Marine Biogeochemistry and Geology and Geophysics sections of the Naval Research Laboratory (NRL) organized and led a team of university and government scientists on an Arctic expedition to initiate methane hydrate exploration in the Beaufort Sea and determine the spatial variation of sediment contribution to Arctic climate change.

Utilizing the U.S. Coast Guard Cutter Polar Sea as a research platform, three cross-shelf transects were surveyed and sampled off Alaska's North Slope at Hammerhead, Thetis Island and Halkett, representing three regions of the Alaskan shelf. The expedition integrated expertise in coastal geophysics, sediment geochemistry, dissolved and free methane fluxes through the water column and into the atmosphere, sediment and water column microbiology and biogeochemistry and detailed characterization of the sub-seafloor geology.

“The objective of the sampling is to help determine variations in the shallow sediment and water column methane sources, methane cycling and the subsequent flux to the atmosphere,” said Richard Coffin, chief scientist, NRL Chemistry Division. Read more ..

Iran's Nukes

Saudi Oil Policy--An Unlikely Weapon for Pressuring Iran

November 16th 2009

Arab Topics - Saudi Oil

Among the policy suggestions for heading off Iran's emergence as a military nuclear power is the notion that Saudi Arabia should use its position—as the world's largest oil exporter and effective leader of the OPEC oil cartel—to apply pressure. The kingdom is increasingly concerned that nuclear weapons capability would confer on Iran the status of regional hegemon. But any hope that Saudi Arabia would intervene to stop that possibility, by pumping extra supplies to lower prices and decrease Iran's oil revenues, is probably misplaced.

Historically, Saudi Arabia has claimed that it will not use its leading role in the oil market for political purposes. In a June 2001 interview with the Financial Times, then Crown Prince Abdullah said: “Oil is a strategic commodity upon which the prosperity of the industrial as well as the developing countries depends. Our oil policy is a prudent one, seeking a balance between the interests of producers and consumers. It serves no purpose to speak about oil outside this framework.” Read more ..

Kicking our Oil Addiction

The Future of Oil in Mexico is in Crisis

November 9th 2009

Energy Topics - Oil Barrels 400px

Mexico is currently facing one of the biggest economic recessions in the country’s two hundred-year history of independence. Some Mexican policy makers blame the economic crisis on this year’s decrease in tourism, while others attribute it to the continued dependence of the Mexican economy on the United States, pointing to its neighbor’s recession as a principal cause for the country’s woes. Nonetheless, Mexico’s plummet in oil production and the decline in the price of oil are two main contributors to its present economic downfall. While other countries have begun to pull out of the recession, it appears that the fall in oil production and prices have further led to an ongoing decline in Mexico’s economy, which the country’s planners are finding difficult to reverse.

Current Oil Situation

Oil is at the heart of the Mexican economy. Profits on its extraction are the country’s number one revenue, accounting for approximately 40 percent of Mexico’s total revenues. Due to the decline in the price of oil that began last year with the escalation of the global recession, Mexico’s oil-dependent economy has suffered grievously. Prior to the sag in oil prices, when other oil producing countries were taking advantage of the tremendous peak in prices, Mexico was hit particularly hard; government officials reported that last year’s drop in oil production cost the Mexican government an estimated US$20 billion in lost revenues. Read more ..

The Race for Biofuel

Cuba's Sweet Success May Come from an Ethanol Future

November 2nd 2009

Latin American Topics - Cuba sugarcane harvest

In his seminal work, Sugarcane Energy Use: The Cuban Case, Alonso-Pippo Walfrido wrote: "Central America and the Caribbean, historical sugar-producing economies where the sugar-ethanol infrastructure already has a foundation, labor costs are low, and the political conditions are more or less stable– offers the best near-term potential for large-scale sugarcane ethanol production. This is a market opportunity which Cuba, with the longest experience of sugar–ethanol and sugarcane derivates production in the region, is positioned to take advantage of.”

As the result of a precipitous contraction in the Cuban economy, Cubans have recently experienced crippling energy cutbacks and other shortfalls that are reminiscent of the devastating hardships of the “Special Period,” and industries have continued to falter due to the evaporation of credit and investment flows which largely dried up after the break-up of the Soviet empire. In the first half of 2009, the Obama Administration launched a series of modest initiatives aimed at normalizing U.S.-Cuba relations, most recently exemplified by the loosening of restrictions on travel by Cuba-Americans, lifting controls on remittances, and giving the nod to U.S. telecommunication investments on the island. Read more ..

Electric Cars

Survey Shows Wide Acceptance of Plug-in Vehicles

October 26th 2009

Automotive - Plug-in Vehicle

A new survey released shows widespread consumer interest in buying plug-in hybrid electric vehicles (PHEVs). But the cost of the cars is much more influential than environmental and other non-economic factors as a predictor of purchase probabilities.

The survey of a nationally representative sample of 2,513 adults age 18 was part of the Reuters/University of Michigan Surveys of Consumers. The findings were released at The Business of Plugging In: A Plug-In Electric Vehicle Conference in Detroit.

Overall, when given no cost or fuel-saving estimates, 42 percent of those surveyed said there was at least some chance that they would buy a PHEV sometime in the future. The researchers then asked respondents to rate the likelihood of purchasing a PHEV under three different cost-scenarios, each time assuming they would save 75 percent in fuel costs compared to a traditional, gasoline-powered vehicle. With each successive doubling of the price of PHEVs, the probability of purchase fell by 16 percentage points. Read more ..


Saudi Princes Plead Vulnerability and Ask for Subsidies if Oil Prices Do Not Escalate

October 19th 2009

Arab Topics - Saudi Oil

The oil princes of Saudi Arabia became literal beggars at the United Nations climate talks that began at Bangkok on September 28. The oil kingdom demanded that they, along with other OPEC member nations, receive subsidies for revenues to be lost due to potential global warming.

Speaking on October 8, Mohammad S. Al Sabban, who led the Saudi delegation at the talks, claimed that a report by the International Energy Agency on OPEC revenues was seriously skewed. According to the IEA, OPEC revenues would still increase by more than $23 trillion between 2008 and 2030. This is  four times the amount revenues increased between 1985 and 2007. Al Sabban said of Saudi Arabia “We are among the economically vulnerable countries,…This is very serious for us. He went on to say “We are in the process of diversifying our economy but this will take a long time. We don’t have too many resources.” Read more ..

The Rail's Edge

Will High-Speed Rail Plan Become a Subsidy for Freight Railroads?

October 12th 2009

Transportation Topics - Shinkansen bullet train

In April, President Barack Obama confirmed his commitment to fund a high-speed rail (HSR) program in the United States and extolled the potential benefits of the $8 billion for HSR that Congress included in the stimulus package. That commitment grew by another $5 billion ($1 billion per year) when the President released his budget for FY 2010, and in an act of almost unprecedented fiscal mushrooming, the House Committee on Transportation and Infrastructure (T&I) proposed to add another $50 billion. Yet, according to recent comments by the head of the Federal Railroad Administration (FRA), little of these federal monies may go toward "real" HSR but instead appear likely to benefit some of the nation's for-profit freight railroads to achieve modestly higher speeds for existing, half-full Amtrak trains running on their tracks. Read more ..

The Race for Biofuels

As Corn Ethanol Threatens Habitat, Prairie Grasses may Provide Wildlife-Friendly Biofuels

October 5th 2009

Energy / Environment - Biofuel field

When society jumps on a bandwagon, even for a good cause, there may be unintended consequences. The unintended consequence of crop-based biofuels may be the loss of wildlife habitat, particularly that of the birds who call this country's grasslands home, say researchers from Michigan Technological University and The Nature Conservancy.

In a paper published in the October 2009 issue of the journal BioScience, David Flaspohler, Joseph Fargione and colleagues analyze the impacts on wildlife of the burgeoning conversion of grasslands to corn. They conclude that the ongoing conversion of grasslands to corn for ethanol production is posing a very real threat to the wildlife whose habitat is being transformed. One potential solution: Use diverse native prairie plants to produce bioenergy instead of a single agricultural crop like corn.

"There are ways to grow biofuel that are more benign," said Flaspohler, an associate professor in the School of Forest Resources and Environmental Science at Michigan Tech. "Our advice would be to think broadly and holistically about the approach you use to solve a problem and to carefully consider its potential long-term impacts."

The rapidly growing demand for corn ethanol, fueled by a government mandate to produce 136 billion liters of biofuel by 2022—more than 740 percent more than was produced in 2006—and federal subsidies to farmers to grow corn, is causing a land-use change on a scale not seen since virgin prairies were plowed and enormous swaths of the country's forests were first cut down to grow food crops, the researchers say.

"Bioenergy is the most land-intensive way to produce energy, so we need to consider the land use implications of our energy policies," said Fargione, lead scientist for The Nature Conservancy's North America Region. Read more ..

Energy Politics

Confronting Iran’s Pipeline Strategy

September 28th 2009

Energy Topics - Nabucco Gas Pipeline 2
Nabucco Pipeline

While Washington is mulling over what to do next in order to weaken Iran economically, this summer the Islamic Republic has taught us a lesson in strategic maneuvering, taking major steps to bolster its economy and geopolitical posture by positioning itself as an indispensable energy supplier to hundreds of millions of people.

Last May, I described how after 14 years of negotiations, Iran, which has the world’s second largest natural gas reserves, signed a deal to connect its economy with its eastern neighbor, Pakistan, via a 1,300-mile natural gas pipeline. Both Iran and Pakistan hope to extend the pipeline into India and perhaps even into China. This would not only give Iran a foothold in the Asian gas market and ensure that millions of Pakistanis, Indians and perhaps Chinese are beholden to Iran’s gas, but it would also provide Iran with an economic lifeline and the diplomatic protection energy-dependent economies typically grant their suppliers.


Kicking our Oil Addiction

US Tax Breaks Subsidize Foreign Oil Production

September 21st 2009

Energy Topics - Oil Barrels 400px

The largest U.S subsidies to fossil fuels are attributed to tax breaks that aid foreign oil production, according to research to be released on Friday by the Environmental Law Institute (ELI) in partnership with the Woodrow Wilson International Center for Scholars. The study, which reviewed fossil fuel and energy subsidies for Fiscal Years 2002-2008, reveals that the lion's share of energy subsidies supported energy sources that emit high levels of greenhouse gases.

The research demonstrates that the federal government provided substantially larger subsidies to fossil fuels than to renewables. Fossil fuels benefited from approximately $72 billion over the seven-year period, while subsidies for renewable fuels totaled only $29 billion. More than half the subsidies for renewables—$16.8 billion—are attributable to corn-based ethanol, the climate effects of which are hotly disputed. Of the fossil fuel subsidies, $70.2 billion went to traditional sources—such as coal and oil—and $2.3 billion went to carbon capture and storage, which is designed to reduce greenhouse gas emissions from coal-fired power plants. Thus, energy subsidies highly favored energy sources that emit high levels of greenhouse gases over sources that would decrease our climate footprint.


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