Gas Glut Rejiggers Industry - WSJ.com

A cost curve such as shown below will disrupt the energy business as the WSJ story describes. Coal is being displaced by natural gas as a primary fuel for baseload electricity generation. With so much natural gas supply coming on line, electricity costs are coming down and greenhouse gas emissions should also be coming down because natural gas burns cleaner (less CO2) than coal. The laws of economics work!

Even here in Vermont where our natural gas comes form Canada via Vermont Gas, Tom Evslin and partners have created a new company to take advantage of these low prices. NG Advantage hopes to compress the gas at a central location and truck it to large fuel users in northern NH, VT and NY not reached by pipelines at a price lower than their present fuel.

Folly of Waxman-Markey H.R. 2454

I subscribe to a monthly printed newsletter called The Energy Advocate. In the July 2009 issue publisher Howard Hayden quotes from the Waxman-Markey (H.R. 2454) "American Clean Energy and Security Act of 2009." This is part of his story about the tremendous strides that have been made in the last 20-30 years in reducing health-affecting air pollutants in the United States.

Because of EPA's attempt to classify CO2 as a pollutant and to regulate its emission, Hayden implies that Congress is on a fool's errand with H.R. 2454 because CO2 is a naturally occurring component of our atmosphere (0.04% by volume), essential for all plant life. He points out that the legislation may have an escape clause (see below).

The respected Christian Science Monitor also has a very recent editorial faulting other elements of the Markey-Waxman bill. My hope is the Senate will drastically modify it or let it lie. I have long maintained that cap-and-trade schemes on this scale are fraught with risk of manipulation, doomed for failure, and will dramatically increase the costs of energy and further repress our economy. If Congress thinks it must control carbon dioxide, a direct carbon tax on the end users is far more rational so that people will see it clearly, not camouflaged in high prices.

The act specifies that the Administrator of the EPA

"shall annually prepare and certify a report to the Congress regarding whether China and India have adopted greenhouse gas emissions standards at least as strict as those standards required under this Act. If the Administrator determines that China and India have not adopted greenhouse gas emissions at least as stringent as those set forth in this Act, the administrator shall notify each Member of Congress of his determination, and shall release his determination to the media."

He also makes the case that CO2 is not a pollutant (as proposed by the EPA).

"With the recent politically directed EPA finding that CO2is a pollutant, there seems to be a feeling among our lawmakers that a reduction in CO2 emissions can be accomplished by laws, regulations, and cap-and-trade schemes. Engineers will use some magic equations and magic substances like Unobtanium to accomplish the will of Waxman, Markey, Pelosi, and other starry-eyed true believers.

The chemical facts are these. Natural gas is primarily methane, CH4, which has four atoms of hydrogen for every carbon atom. Petroleum contains a great many compounds but all-in-all, the lot of them can be roughly represented by CH2; there are two atoms of hydrogen per atom of carbon. Coal is roughly CH, with one atom of hydrogen for each carbon atom. (We ignore contaminants here.)

When we burn any of these fuels, part of the energy comes from burning the carbon and part from burning the hydrogen. Necessarily we get H2O and CO2 as products of the combustion. It's not as if the carbon is some sort of contaminant in the fuel; it is part of the fuel. There is no such thing as low carbon natural gas, low carbon oil, or low carbon coal. Another way of saying it is that without carbon, coal, oil and natural gas would not exist. If I dwell on the obvious, it is precisely because Washington's climate controllers are unable to understand such subtleties."

Obama's energy pick endorses nukes, clean coal | Politics and Law - CNET News

Obama's energy pick endorses nukes, clean coal | Politics and Law - CNET News


Dr. Chu will not be embraced by some rabid greenies who believe the forecast for energy's future is all windy and sunny. He makes sense with his initial remarks. There's no question that efficiency will be the low-hanging fruit and that coal and nuclear will be with us for a very long time.

On Vermont's nuclear front, the Legislature should quickly decide the fate of Vermont Yankee. Their best bet would be to repaeal the authority thay have previously given themselves to decide VY's fate. They would be better served and off the hook by leaving the decision where it belongs...with the NRC and the Public Service Board.

Lawmakers Push for Big Subsidies for Coal Process - New York Times

Lawmakers Push for Big Subsidies for Coal Process - New York Times

This piece by Edmund Andrews points to the big battle ahead as coal, the most abundant fuel in the U.S. by far, becomes a target in the debate for energy independence amidst the furor around climate change.

The debate will pit the need for government subsidies for 'Big Coal' to build coal to liquid fuel plants which would sequester carbon dioxide and the conservationists who simplistically believe that a change in lifestyle by tens of millions of Americans can have a dramatic effect on climate change. (an irrational belief based on the notion that we must 'do something', however ineffective it is)

The truth is somewhere in the middle of these arguments which will pervade Congress soon. We need to conserve energy whenever possible and economically feasible, but that should be an individual choice with various positive and negative incentives by government to help out.

Despite our best efforts, the energy future is one of increasing total demand under any scenario simply because of increasing population and the improving economic conditions of the world's population centers, i.e., China and India. I envision no scenario short of nuclear war or extreme famine where the world's energy demand will decrease. It follows that energy prices will increase with shortages of natural fuels (coal or petroleum or natural gas) or high costs to convert them to usable energy. For the foreseeable future we in the U.S. will be caught in the pincers of higher energy prices and lifestyle changes. Let's hope we can avoid the sort of 'group think' that seems so prevalent on issues that have no easy ( if any) solution, e.g., climate change.

There is a great deal of money to be made by businesses as the conflict unfolds between energy independence and the 'greening' mood triggered by the advocates of controlling climate change. Many smart companies have recognized this, General Electric for one with their Ecomagination thrust, and are adapting their strategies to take advantage of the situation.