Feeds:
Posts
Comments

Posts Tagged ‘Natural Gas’

DAVID TOW, Future Planet, January 16, 2010

By 2015 India and China will both have outstripped the US in energy consumption by a large margin. Cap and Trade carbon markets will have been established by major developed economies, including India and China, as the most effective way to limit carbon emissions and encourage investment in renewable energy, reforestation projects etc.

There will have been a significant shift by consumers and industry to renewable energy technologies- around 25%, powered primarily by the new generation adaptive wind and solar energy mega-plants, combined with the rapid depletion of the most easily accessible oil fields. Coal and gas will continue to play a major role at around 60% useage, with clean coal and gas technologies still very expensive. Nuclear technology will remain static at 10% and hydro at 5%.

Most new vehicles and local transport systems will utilise advanced battery or hydrogen electric power technology, which will continue to improve energy density outputs.

Efficiency and recycling savings of the order of 30% on today’s levels will be available from the application of smart adaptive technologies in power grids, communication, distribution and transport networks, manufacturing plants and consumer households. This will be particularly critical for the sustainability of cities across the planet. Cities will also play a critical role in not only supporting the energy needs of at least 60% of the planet’s population through solar, wind, water and waste energy capture but will feed excess capacity to the major power grids, providing a constant re-balancing of energy supply across the world.

By 2025 a global Cap and Trade regime will be mandatory and operational worldwide. Current oil sources will be largely exhausted but the remaining new fields will be exploited in the Arctic, Antarctic and deep ocean locations.  Renewable energy will account for 40% of useage, including baseload power generation. Solar and wind power will dominate in the form of huge desert solar and coastal and inland wind farms; but all alternate forms- wave, geothermal, secondary biomass, algael etc will begin to play a significant role.

Safer helium-cooled and fast breeder fourth generation modular nuclear power reactors will replace many of the older water-cooled and risk-prone plants, eventually  accounting for around 15% of energy production; with significant advances in the storage of existing waste in stable ceramic materials.

By 2035 global warming will reach a critical threshold with energy useage tripling from levels in 2015, despite conservation and efficiency advances. Renewables will account for 60% of the world’s power supply, nuclear 15% and fossils 25%. Technologies to convert CO2 to hydocarbon fuel together with more efficient recycling and sequestration, will allow coal and gas to continue to play a significant role.

By 2045-50 renewables will be at 75-80% levels, nuclear 12% and clean fossil fuels 10-15%. The first Hydrogen and Helium3 pilot fusion energy plants will be commissioned, with large-scale generators expected to come on stream in the latter part of the century, eventually reducing carbon emissions to close to zero.

However the above advances will still be insufficient to prevent the runaway effects of global warming. These long-term impacts will raise temperatures well beyond the additional two-three degrees centigrade critical limit.

Despite reduction in emissions by up to 85%, irreversible and chaotic feedback impacts on the global biosphere will be apparent. These will be triggered by massive releases of methane from permafrost and ocean deposits, fresh water flows from melting ice causing disruptions to ocean currents and weather patterns.

These will affect populations beyond the levels of ferocity of the recent Arctic freeze, causing chaos in the northern hemisphere and reaching into India and China and the droughts and heat waves of Africa, the Middle East and Australia.

The cycle of extreme weather events and rising oceans that threaten to destroy many major coastal cities will continue to increase, compounded by major loss of ecosystems, biodiversity and food capacity. This will force a major rethink of the management of energy and climate change as global catastrophe threatens.

Increasingly desperate measures will be canvassed and tested, including the design of major geo-engineering projects aimed at reducing the amount of sunlight reaching earth and reversal of the acidity of the oceans. These massive infrastructure projects would have potentially enormous ripple-on effects on all social, industrial and economic systems. They are eventually assessed to be largely ineffective, unpredictable and unsustainable.

As forecasts confirm that carbon levels in the atmosphere will remain high for the next 1,000 years, regardless of mitigating measures, priorities shift urgently to the need to minimise risk to life on a global scale, while protecting civilisation’s core infrastructure, social, knowledge and cultural assets.

Preserving the surviving natural ecosystem environment and the critical infrastructure of the built environment, particularly the Internet and Web, will now be vital. The sustainability of human life on planet Earth, in the face of overwhelming catastrophe, will be dependent to a critical degree on the power of the intelligent Web 4.0, combining human and artificial intelligence to manage food, water, energy and human resources.

Only the enormous problem-solving capacity of this human-engineered entity, will be capable of ensuring the continuing survival of civilisation as we know it.

Read Full Post »

MARK CLAYTON, The Christian Science Monitor, June 8, 2009

article_photo1_smWhen giving his slide presentation on America’s new energy direction, Jon Wellinghoff sometimes sneaks in a picture of himself seated in a midnight blue, all-electric Tesla sports car.

It often wins a laugh, but makes a key point: The United States is accelerating in a new energy direction under President Obama’s newly appointed chairman of the Federal Energy Regulatory Commission (FERC). At the same time, FERC’s key role in the nation’s energy future is becoming more apparent.

Energy and climate legislation now pending in Congress would put in FERC’s hands a sweeping market-based cap-and-trade system intended to lower industrial greenhouse-gas emissions.

Besides its role granting permits for new offshore wind power, the agency is also overseeing planning for transmission lines that could one day link Dakota wind farms to East Coast cities, and solar power in the Southwest to the West Coast.

“FERC has always been important to power development,” says Ralph Cavanagh, energy program codirector for the Natural Resources Defense Council, a New York-based environmental group. “It’s just that people haven’t known about it. They will pretty soon.”

That’s because Mr. Wellinghoff and three fellow commissioners share an affinity for efficiency and renewable energy that’s not just skin-deep, Mr. Cavanagh and others say.

Wellinghoff started his energy career as a consumer advocate for utility customers in Nevada before being appointed by President Bush in 2005 as a FERC commissioner. He was a key author of “renewable portfolio standards” that require Nevada’s utilities to incorporate more renewable power in their energy mix. Now he’s the nation’s top energy regulator.

It’s clear that FERC has a mandate to speed change to the nation’s power infrastructure, Wellinghoff says.

When it comes to the extra work and complexity FERC will encounter if Congress appoints FERC to administer a mammoth carbon-emissions cap-and-trade program, Wellinghoff is eager, yet circumspect.

“We believe we are fully capable of fulfilling that role with respect to physical trading [of carbon allowances],” he says during an interview in Washington. “We’ve demonstrated our ability to respond efficiently and effectively to undertake those duties Congress has given to us. Unfortunately, the result of that is they give you more to do.”

While the US Department of Energy controls long-term energy investment decisions, FERC’s four commissioners (a fifth seat is vacant) appear determined to ensure that wind, solar, geothermal, and ocean power get equal access to the grid.

The commissioners are also biased against coal and nuclear power on at least one key factor: cost.

Many in the power industry believe that renewable energy still costs too much. Not Wellinghoff, who says: “I see these distributed resources [solar, wind, natural-gas microturbines, and others] coming on right now as being generally less expensive.”

That might sound surprising. Yet, with coal and nuclear power plants costing billions of dollars – and raising environmental issues such as climate change and radioactive waste – others also see renewable power as the low-cost option.

Wellinghoff’s outspoken views have irritated some since his March selection as chairman.

Last month, for instance, he drew fire from nuclear-energy boosters in Congress after he characterized as “an anachronism” the idea of meeting future US power demand by building large new coal-fired and nuclear power plants.

“You don’t need fossil fuel or nuclear [plants] that run all the time,” Wellinghoff told reporters at a US Energy Association Forum last month. Then he added: “We may not need any, ever.”

That set off a salvo from Sen. Lind sey Graham (R) of South Carolina, a staunch nuclear-power advocate. “The public is ill-served when someone in such a prominent position suggests alternative-energy programs are developed and in such a state that we should abandon our plans to build more plants,” he said in a statement.

But to others, Wellinghoff is the epitome of what the US needs: a public servant zeroed in on energy security, the environment, efficiency, and keeping energy costs down.

“Wellinghoff has been a longtime supporter of efficiency and consumer interests,” says Steven Nadel, executive director of the American Council for an Energy Efficient Economy, an energy advocacy group. “I would call him a visionary. He’s not just content with the status quo.”

In Wellinghoff’s vision of the future, where the cost of carbon dioxide emissions is added to the price of coal-fired power plants and natural-gas turbines, it may be less expensive for consumers to set their appliances to avoid buying power at peak times. Or they may choose to buy power from a collection of microturbines, fuel cell, wind, solar, biomass, and ocean power systems.

“We’re going to see more distributed generation – and we’re already starting to see that happen,” Wellinghoff says. “Not only renewable generation like photovoltaic [panels] that people put on their homes and businesses, but also fossil-fuel systems like combined heat and power,” called cogeneration units.

To coordinate and harmonize this fluctuating phalanx of power sources, customers will need to know and be able to respond to the price of power, Wellinghoff says. They will also need a new generation of appliances that switch off automatically to balance power supply and demand peaks.

But there are huge challenges with a power grid that provides energy from a mix of wind, solar, and other renewable power.

“You’re going to have to upgrade this whole grid [along the East Coast], he says. “You can’t just move [wind and wave power] from offshore to load centers onshore without looking at the effect on reliability – Florida to Maine.”

As the percentage of renewable power rises toward 20 to 25% of grid power from around 3% today, there must be a backup to fill gaps when intermittent winds stop blowing or the sun doesn’t shine.

In a decade or more from now, Wellinghoff, says millions of all-electric or plug-in electric-gas hybrid vehicles could plug into the grid and supply spurts of power to fill in for dipping wind and solar output.

“There are new technologies,” he says, “that in the next three to five years will advance the grid to a new level.”

Gesturing to a drawing board on the wall, he hops up from his chair, his hands flicking across a sketch of the eastern half of the US with power lines fanning out from the Plains states to the East Coast.

“This is another grid option that would take a lot of power that’s now constrained in the Midwest, that can be developed – wind energy there – and move it to all the load centers [cities] on the East Coast,” he says.

Similarly, lines could be built across the Rockies to connect wind power in Montana and Wyoming to the West Coast. Instead of building power lines from the Midwest to the East Coast, “a lot of people would say, ‘No, no, let’s look first look at the wind offshore,’ ” he says.

Whether it’s wind from the Plains or the ocean, the resulting variability will have an impact on grid reliability if action isn’t taken, Wellinghoff says.

“You’re going to have to upgrade this whole grid here,” he says, gesturing to the East Coast. “You can’t just move [power] from offshore to load centers onshore without looking at the effect on reliability.”

Reliability of the grid remains paramount – Job No. 1 for the Federal Energy Regulatory Commission. But if boosting renewable power to 25% by 2025 – the Obama administration’s goal – means spreading Internet-connected controllers across substations and transmission networks, then cybersecurity to protect them from increasing Internet-based threats is critical.

Yet a recent review by the North American Electric Reliability Corporation overseen by FERC found more than two-thirds of power generating companies denied they had any “critical assets” potentially vulnerable to cyberattack. Those denials concern Wellinghoff.

“We are asking the responding utilities to go back and reveal what are the number of critical assets and redetermine that for us,” he says. “We want to be sure that we have fully identify all the critical assets that need to be protected.”

It would be especially troubling if, as was recently reported by The Wall Street Journal, Russian and Chinese entities have hacked into the US power grid and left behind malware that could be activated at a later time to disable the grid.

But Wellinghoff says he has checked on the type of intrusion referred to in the article and denies successful grid hacks by foreign nations that have left dangerous malware behind.

While acknowledging that individuals overseas have tried to hack the grid frequently, he says, “I’m not aware of any successful hacks that have implanted into the grid any kinds of malware or other code that could later be activated.”

But others say there is a problem. In remarks at the University of Texas at Austin in April, Joel Brenner, the national counterintelligence executive, the nation’s most senior counterintelligence coordinator, indicated there are threats to the grid.

“We have seen Chinese network operations inside certain of our electricity grids,” he said in prepared remarks. “Do I worry about those grids, and about air traffic control systems, water supply systems, and so on? You bet I do.”

In an e-mailed statement, Wellinghoff’s press secretary, Mary O’Driscoll, says the chairman defers to senior intelligence officials on some questions concerning grid vulnerability to cyberattack: “The Commission isn’t in the intelligence gathering business and therefore can’t comment on that type of information.”

Read Full Post »

NEIL KING, The Wall Street Journal, January 9, 2009

pickens372Dallas billionaire T. Boone Pickens and FedEx Corp. chief executive Fred Smith are now duking it out—over, of all things, the virtues of natural gas as a transportation fuel.

Since announcing the Pickens Plan in July, the oilman-cum-wind power booster has spent over $60 million, along with countless hours zig-zagging the country in his corporate jet, to promote his plan for using wind power and natural-gas vehicles to break the country’s foreign-oil habit. The Oklahoma-born oil magnate insists the U.S. could cut its oil imports by one-third in 10 years by mandating that all new long-haul trucks dump diesel in favor of liquefied natural gas.

He just unveiled yet another TV ad and is building up his Pickens Army online—now 1.35 million strong and counting—in order to pressure the new Congress to translate his plan into law.

But Mr. Pickens has his opponents, including FedEx CEO Fred Smith, who favors electrification of the transporation fleet. Mr. Smith argues that hybrids are the way to go, and is putting his money where his mouth is. With 80,000 motorized vehicles, FedEx now boasts the largest fleet of commercial hybrid trucks in North America.

Without naming Mr. Pickens, the company’s director of sustainability, Mitch Jackson, upped the ante on Sunday with a blog item blasting natural gas as transport fuel of the future.  After citing a list of reasons against using natural gas instead of diesel, Mr. Jackson concludes that “substituting one fossil fuel for another may mean we’re shifting our energy supply, but it doesn’t necessarily mean we’re going anywhere.”

Mr. Pickens then let it rip with a rebuttal that accuses Mr. Jackson of making a “flawed argument” by misunderstanding the country’s natural-gas reserves and overstating the value of diesel hybrids.

“Not only does Jackson need to do more homework on the domestic availability and clean air benefits of natural gas,” Mr. Pickens writes in his Daily Pickens blog, “he needs to realize that deploying vehicles that use slightly less foreign oil – vehicles that have little testing or are not available in the marketplace – will not solve America’s energy crisis.”

Mr. Pickens has won allies in his natural-gas fight, including an array of lawmakers in Washington and army of online supporters. Fedex rival UPS is turning some of its fleet over to natural gas, and WalMart is eyeing a similar plan.

But along with FedEx, the American Trucking Association is not keen on the idea. And ExxonMobil CEO Rex Tillerson took his own swipe at it in a speech on Thursday, saying the plan “has a number of flaws in its assumptions” and could end up increasing U.S. reliance on foreign oil.

Read Full Post »

JOHN M. BRODER, The New York Times, December 18, 2008

17transition2-6001President-elect Barack Obama’s choice to lead the Interior Department, Senator Ken Salazar of Colorado, will inherit an agency demoralized by years of scandal, political interference and mismanagement.

He must deal with the sharp tension between those who seek to exploit public lands for energy, minerals and recreation and those who want to preserve the lands. He will be expected to restore scientific integrity to a department where it has repeatedly been compromised. He will be responsible for ending the department’s coziness with the industries it regulates. And he will have to work hard to overcome skepticism among many environmentalists about his views on resource and wildlife issues.

One senior Interior Department executive described the job Mr. Salazar has been chosen for as “the booby prize of the Cabinet.”

As Mr. Obama introduced Mr. Salazar and Tom Vilsack, the former Iowa governor tapped to be secretary of agriculture, at a press conference Wednesday in Chicago, he said their responsibility would be to balance the protection of farms and public lands against the need to find new sources of energy.

“It’s time for a new kind of leadership in Washington that’s committed to using our lands in a responsible way to benefit all our families,” Mr. Obama said. “That means ensuring that even as we are promoting development where it makes sense, we are also fulfilling our obligation to protect our national treasures.”

Mr. Salazar, wearing his customary ten-gallon hat and bolo tie, said that his job entails helping the nation address climate change through a “moon shot” on energy independence. But that would include not just the development of “green” energy sources like wind power, but also the continued domestic development of coal, oil and natural gas, fossil fuels that generate greenhouse gases when they are burned.

Environmental advocates offered mixed reviews of Mr. Salazar, 53, a first-term Democratic senator who served as head of Colorado’s natural resources department and as the state’s attorney general. Mr. Salazar was not the first choice of environmentalists, who openly pushed the appointment of Representative Raul Grijalva, Democrat of Arizona, who has a strong record as a conservationist.

Oil and mining interests praised Mr. Salazar’s performance as a state official and as a senator, saying that he was not doctrinaire about the use of public lands. “Nothing in his record suggests he’s an ideologue,” said Luke Popovich, spokesman for the National Mining Association. “Here’s a man who understands the issues, is open-minded and can see at least two sides of an issue.”

Mr. Popovich noted approvingly that Mr. Salazar had tried to engineer a deal in the Senate allowing mining companies and others to reclaim abandoned mines without fear of lawsuits. (The legislation is pending.) He has also supported robust research on technology to reduce carbon dioxide emissions from coal-burning power plants, something the coal industry favors.

He also backed a compromise that would let oil companies drill for natural gas in limited parts of the Roan Plateau in northwestern Colorado, a plan that most environmental advocates opposed.

Mr. Salazar is a fifth-generation Coloradan who grew up on a ranch near the New Mexico border. He has been a farmer, lawyer and small-business man as well as a public servant.

Pam Kiely, program director at Environment Colorado, said Mr. Salazar had been a champion of wilderness protection and of strong water quality laws, and had raised questions about the environmental costs of oil shale development, a subject of great controversy in the Mountain West. She said he had not spoken out forcefully against oil and gas development in millions of acres of national forests and roadless areas.

“We hope he continues to play a role in ensuring that, as we develop our mineral rights in these incredibly sensitive areas, we require industry to put in place safeguards that protect our health, environment, water and air quality,” Ms. Kiely said.

Marc Smith, executive director of the Independent Petroleum Association of Mountain States, said in a statement that Mr. Salazar understood that energy security can be achieved only by making use of all domestic energy sources, including those found on and under public lands.

“We are pleased that the president-elect has chosen someone who understands that there is a direct connection between federal lands and access to affordable, clean natural gas,” Mr. Smith said.

While industry officials praised his moderation, Mr. Salazar drew harsh criticism from some environmentalists.

“He is a right-of-center Democrat who often favors industry and big agriculture in battles over global warming, fuel efficiency and endangered species,” said Kieran Suckling, executive director of Center for Biological Diversity, which tracks endangered species and habitat issues. “He is very unlikely to bring significant change to the scandal-plagued Department of Interior. It’s a very disappointing choice for a presidency which promised visionary change.”

Daniel R. Patterson, formerly an official of the Interior Department’s Bureau of Land Management and now southwest regional director of the Public Employees for Environmental Responsibility, an advocacy group, said that Mr. Salazar has justifiably become the most controversial of Mr. Obama’s cabinet appointees.

“Salazar has a disturbingly weak conservation record, particularly on energy development, global warming, endangered wildlife and protecting scientific integrity,” said Mr. Patterson, who was elected last month to the Arizona House of Representatives from Tucson and who supports fellow Arizonan Mr. Grijalva for the Interior job. “It’s no surprise oil and gas, mining, agribusiness and other polluting industries that have dominated Interior are supporting rancher Salazar — he’s their friend.”

Even as Mr. Salazar navigates the department’s tricky political cross-currents, he must also deal with significant internal management challenges. Members of Congress and outside groups are calling for review of dozens of decisions made under the Bush administration on endangered species and oil and gas leasing. The senior management ranks of the department have been depleted by departures of demoralized career employees.

And the agency’s computer systems are badly in need of repair, after millions of dollars have been spent on systems that have not worked, according to several internal reports.

Read Full Post »

RYAN RANDAZZO, The Arizona Republic, November 12, 2008

tboonepickensBillionaire T. Boone Pickens said that his Texas wind farm is on hold because natural gas prices have dropped but that his plan for wind power and natural gas vehicles is still viable to reduce foreign oil imports.

The Texas oil tycoon spoke Tuesday to about 650 utility and investment officials gathered in Phoenix for the Edison Electric Institute Financial Conference.

Pickens launched an advertising campaign last summer to promote wind farms to generate electricity and to use natural gas to power vehicles. “I’m the only person in the United States that has a plan,” he said. “Senator Obama and his people have been in touch with mine. They see the merits of what we are doing.”

Pickens said the U.S. needs to exploit all its resources, from solar power in Arizona to coal and nuclear energy, but that few things could cut foreign oil imports quickly.

He said neither Obama’s plans for 1 million plug-in hybrid vehicles nor John McCain’s plans for 45 more nuclear plants would make a dent in oil imports, but semitrucks fueled by natural gas could reduce oil demand for the next 20 years before better transportation technology is available.

“It’s a bridge to the next generation, which will probably be the battery, the fuel cell,” he said. “It won’t be the hydrocarbon.”

But the current drop in oil and natural-gas prices is slowing things down.

Until natural gas prices rise, Pickens said his wind farm and most others in the country will not go forward because electricity from gas plants will be more economical. Still, he was confident prices would rise.

He said Americans haven’t understood the nation’s energy challenges because prices have been low, until last summer when oil hit a record $147 a barrel.

“You haven’t had the leadership in Washington to tell us what the problem was,” he said. “The American people did not realize where we were. When oil went to $100, I had a story to tell.”

Steven Dreyer, managing director at Standard and Poor’s, credited Pickens for raising awareness.

“Arguably, for the first time, ordinary people were able to connect the dots between carbon reduction and energy,” Dreyer said.

Ron Insana, managing director of SAC Capital Advisors and former CNBC commentator, questioned Pickens about how he will benefit financially by such a plan through his wind farm and large stake in Clean Energy Fuels Corp., a natural gas, vehicle fueling company.

Pickens described his potential to profit from wind and natural gas but said his motivations are patriotic.

“I’d rather be playing golf at the Del Mar Country Club this afternoon,” Pickens said. “But I truly believe this is good for the country.”

Pickens believes that global oil production has already “peaked” and that it will continue to become scarcer and more expensive, despite the current lull in gas prices.

He is founder and chairman of energy-investment company BP Capital and founded Mesa Petroleum, a natural gas and oil producer. He is a geologist by training.

“When I launched my plan July 8, gas prices were $4.11 a gallon, and now they’re half that. I think I’ve done a pretty good job,” he said to chuckles from the audience.

He predicted oil, which closed Tuesday at $59, to be $100 a barrel within a year, and could be $300 a barrel by 2018.

Pickens supports domestic drilling but said that can’t come close to meeting daily U.S. oil demand.

Read Full Post »

CLIFFORD KRAUSS, The New York Times, August 30, 2008

SALT LAKE CITY — The best deal on fuel in the country right now might be here in Utah, where people are waiting in lines to pay the equivalent of 87 cents a gallon. Demand is so strong at rush hour that fuel runs low, and some days people can pump only half a tank.

It is not gasoline they are buying for their cars, but natural gas.

By an odd confluence of public policy and private initiative, Utah has become the first state in the country to experience broad consumer interest in the idea of running cars on clean natural gas.

Residents of the state are hunting the Internet and traveling the country to pick up used natural gas cars at auctions. They are spending thousands of dollars to transform their trucks and sport utility vehicles to run on compressed gas. Some fueling stations that sell it to the public are so busy they frequently run low on pressure, forcing drivers to return before dawn when demand is down.

It all began when unleaded gasoline rose above $3.25 a gallon last year, and has spiraled into a frenzy in the last few months.

Ron Brown, Honda’s salesman here for the Civic GX, the only car powered by natural gas made by a major automaker in the country, has sold one out of every four of the 800 cars Honda has made so far this year, and he has a pile of 330 deposit slips in his office, each designating a customer waiting months for a new car.

“It’s nuts,” Mr. Brown said. “People are buying these cars from me and turning around and selling them as if they were flipping real estate.”

Advocates for these cars see Mr. Brown’s brisk sales as a sign that natural gas could become the transport fuel of the future, replacing much of the oil the nation imports. While that remains a distant dream, big increases recently in the country’s production of natural gas do raise the possibility of making wider use of the fuel.

To a degree, it is already starting to happen in Utah, where the cost savings have gotten the public’s attention. Natural gas is especially cheap here, so that people spend about 87 cents for a quantity of gas sufficient to propel a car approximately the same distance as a $3.95 gallon of gasoline.

The word about natural gas cars has been spreading in news reports and by word of mouth, and so many people in Utah are now trying to get their hands on used natural gas vehicles that they are drying up the national supply. Used car lots are stocking up, and beginning to look like county government parking lots with multiple lines of identical white Civic GXs once used in out-of-state fleets.

Gov. Jon M. Huntsman Jr. got into the act last year, spending $12,000 out of his own pocket to convert his state sport utility vehicle to run on natural gas. “We can create a model that others can look to,” Mr. Huntsman said in an interview. “Every state in America can make this a reality.”

In fact, some unique factors apply in Utah. Natural gas prices at the pump here are controlled and are the cheapest in the country, while the price of conventional gasoline is one of the highest. Questar Gas, the public utility, has compressed-gas pumps around the state open to the public, a fueling infrastructure that few states can match.

Special factors or not, the sudden popularity of natural gas vehicles here demonstrates their potential, according to advocates like T. Boone Pickens, the Texas oil billionaire who is financing a national campaign promoting wind power and natural gas to replace imported oil. “Utah shows that the technology is here and the fuel works and the fuel is better than foreign oil,” Mr. Pickens said.

Natural gas cars produce at least 20% less greenhouse gas per mile than regular cars, according to a California study.

No official figures are available on how many natural gas vehicles Utah has, in part because so many people go to garages that install conversion kits that are not certified by the EPA and are therefore illegal.

(Governor Huntsman has expressed concern, and some in the installation business have requested that the EPA close down the unauthorized operations; the agency says it does not comment on possible investigations.)

But Questar estimates the number at 6,000 and growing by several hundred a month. That is small compared with the 2.7 million vehicles registered in the state, but natural gas executives and state government officials say it makes Utah the fastest-growing market in the country for such cars.

Cars fueled by compressed natural gas have been available intermittently in the United States for decades, and have found wide use in fleets, but have never attracted much consumer interest. The situation is markedly different abroad. Of the eight million natural gas vehicles operating worldwide, only about 116,000 were in the United States, mostly as fleet vans, buses and cars, according to a 2006 Energy Department estimate.

Congress mandated the use of fleets capable of using alternative fuel cars for governments and some energy companies in the early 1990s, but public interest petered out as gasoline prices plummeted. Over the years, all the major car companies except Honda dropped their production in the United States.

The cars have two major disadvantages — a shortage of fueling stations and limited range. (A typical natural gas car goes half as far on a full tank as a gasoline car.) Utah is one of the few states where a driver can travel across the state without being out of range of a station.

The situation is a Catch-22: Carmakers do not want to make natural gas cars when few filling stations are set up for them, and few stations want to install expensive equipment to compress gas with so few cars on the road.

Hundreds of stations supply compressed gas in a few states like California, New York and Arizona, but most are either closed to the public or charge only modestly less than regular gasoline prices.

Retail natural gas prices in some states are triple the price in Utah. The only state that comes close to Utah’s low gas prices is Oklahoma, and a surge of natural gas car buying is going on there, too.

The natural gas industry and some politicians are pushing to open up the market to gas-powered vehicles across the country. Even in states without fueling stations, a few drivers have switched by spending several thousand dollars to install a home gas compressor.

A proposal on the ballot in California this fall would allow the state to sell $5 billion in bonds to finance rebates of $2,000 and more to buyers of natural gas vehicles. Legislation has been introduced in Congress to offer more tax credits to producers and consumers and mandate the installation of gas pumps in certain service stations, with the goal of making natural gas cars 10% of the nation’s vehicle fleet over the next decade.

“If the incentives are right and the fuel and cars are available, natural gas can work,” said Gordon Larsen, supervisor for natural gas vehicle operations at Questar Gas. But he said that any drop in gasoline prices douses enthusiasm among drivers considering the switch.

With gasoline hovering just below $4 a gallon for unleaded regular here, interest in the Salt Lake City area is strong.

Questar reports that the volume of natural gas pumped at its 21 filling stations is up 240% this year from last, after a 50% rise in 2007. Demand has grown so fast that the compressors at many of Questar’s stations run low during the day, forcing drivers to settle for half a tank or fill up during off-peak hours.

The natural gas car surge in Utah is because of several factors. Questar has had filling pumps around the state to fuel its own fleet of service vehicles since the 1980s, and because it had excess capacity, it opened those stations to the public. Natural gas prices are cheap because under Utah regulations, the utility is obliged to offer about half of the gas that it sells to its retail customers at the cost of production.

The state and a few municipalities are preparing to open more filling stations. If the trend continues, it could eventually lower the environmental impact of driving in Utah.

For now, demand for compressed-gas cars is outstripping supply.

“People get into a frenzy and they just have to buy,” said Rick Oliver, owner of a company that converts vehicles. He said that in a recent online auction, a Utah buyer paid $19,000 for a 2001 Civic GX with 50,000 miles — the price a buyer of a new GX would pay after state and federal tax credits.

Gary Frederickson, a 48-year-old computer technician, has bought six natural gas vehicles on Craigslist over the last year, flying as far as Portland and Oakland to pick up the cars. One 1998 Ford Contour he bought for $3,000 in effect cost him nothing because he will receive a $3,000 state tax credit for buying an alternative fuel car.

“It’s crazy to be in Utah and have access to 85-cent-a-gallon fuel and not take advantage of it,” he said before a recent 2-cent increase.

Read Full Post »

PETER SLEVIN, The Washington Post, August 18, 2008

DENVER — When Colorado voters were deciding whether to require that 10% of the state’s electricity come from renewable fuels, the state’s largest utility fought the proposal, warning that any shift from coal and natural gas would be costly, uncertain and unwise.

Then a funny thing happened. The ballot initiative passed, and Xcel Energy met the requirement eight years ahead of schedule. And at the government’s urging, its executives quickly agreed to double the target, to 2%.

In Colorado — a state historically known for natural gas and fights over drilling — wind and solar power are fast becoming prominent parts of the energy mix. Wind capacity has quadrupled in the past 18 months, according to Gov. Bill Ritter (D), and Xcel has become the largest provider of wind power in the nation.

The politics and economics of energy are shifting here in ways that foretell debates across the country as states create renewable-energy mandates and the federal government moves toward limiting carbon emissions. One advocate calls Colorado “ground zero” for the looming battle over energy.

Despite a continuing boom, oil and gas companies here are on the defensive. They are spending heavily as they try to prevent the repeal of as much as $300 million in annual tax breaks that would be shifted to investment in renewables and other projects.

The industry, already facing a rebellion among some longtime supporters angered by its toll on the environment, also finds itself in a fight against new regulations designed to protect wildlife and public health from the vast expansion in drilling. Beyond the merits, the proposals reflect the strengthened hand of environmentalists and their friends who feel that the fossil-fuel companies have held sway too long.

“Now is a terrific time for renewables to launch. I hope they get all the capital they need, and all the great minds and talent. But I don’t want it to come at the expense of the oil and gas industry,” said Meg Collins, president of the Colorado Oil & Gas Association. “As goes Colorado, so goes the West, as far as this energy policy debate.”

State leaders are thrilled with the economic benefits that have come with the hundreds of new research and manufacturing jobs in pursuit of alternative power. Yet the fledgling renewables industry is also facing challenges, from a desire for tax credits of its own to a need for a stronger transmission grid that will make power more portable.

“The future in Colorado is building wind farms in wheat fields,” said Ritter, a former Denver prosecutor, recalling the 2006 campaign pitch that helped carry him into the governor’s office. “Quite frankly, it’s how we should have been thinking for 10 years.”

Ten years ago, Xcel began offering wind-generated electricity, but it was a niche market for eco-conscious customers willing to pay extra. That changed in a significant way after 2004, when Xcel lost the referendum fight.

After legislative efforts failed, proponents of renewable energy turned to the ballot that year. The initiative, Amendment 37, required the state’s biggest utilities to generate 10% of their electricity from renewable sources. Advocates found themselves facing off against Xcel, which said it feared for its bottom line.

“We ended up opposing that amendment. In retrospect, I wish we hadn’t,” said Frank Prager, Xcel’s vice president for environmental policy. He said utility companies are inherently conservative, yet find themselves facing a transformation in an industry that, as he put it, has changed little since Thomas Edison’s time.

Voters rejected the utility industry’s arguments and approved the measure, making Colorado the first state to mandate renewable-energy use at the ballot box. Today, legislatures in more than 25 states have set prescribed levels, known formally as “renewable portfolio standards.”

“It was one of those cases where the public was ahead of the politicians,” said Tom Plant, Ritter’s top energy strategist.

Once Xcel executives began to come to terms with the new rules, they discovered that federal tax credits made wind power affordable, especially in relation to rising natural gas prices. The cost of wind power is relatively constant and provides a hedge against future emissions regulation, such as the cap-and-trade approach favored by presidential candidates Barack Obama (D) and John McCain (R).

“It was good for the system,” Xcel’s Prager said, referring to the utility’s mix of energy sources, “and it was good for the customer.”

By the end of 2007, Xcel had met Amendment 37’s goal and endorsed Ritter’s request to double it to 20% by 2020. That measure passed the Colorado legislature easily: With the utility on board and public sentiment clear, the bill collected 50 sponsors in the 65-member House.

Executives at publicly traded Xcel stress their twin desires to make money and to insulate the company from the risks of unproven technology. As Prager put it during an interview in the company’s downtown Denver headquarters: “It’s absolutely essential that the state offer us something that makes it worth our while to be green.”

Amendment 37 allows utilities to collect a fee from customers to invest in renewable fuels; it averages $12.72 a year for a typical homeowner with a monthly bill of $73. When the renewables goal doubled last year, so did the fee. Prager said the fee has provided Xcel $37.6 million between March 2006 and July 2008 for capital investment in wind and solar.

Colorado is adding wind-power capacity at a higher rate than any other state, its hundreds of turbines delivering one gigawatt of generating power at the end of 2007. That is triple the total of 12 months earlier. Six states produce more than one gigawatt with wind, with Texas far in front and California second.

Solar power remains a small part of the equation in Colorado, in part because concentrated solar generation is expensive. Xcel is sponsoring an 80-acre field of photovoltaic panels in the San Luis Valley, a project expected to provide 8.2 megawatts of electricity, enough to power about 1,500 homes. But only 4% of Xcel’s renewable megawattage is required to come from solar.

Meanwhile, Xcel’s latest plan, filed with the Colorado Public Utilities Commission, calls for retiring two of its aging coal-fired power generators.

“We’ve reached this critical point where we’re seeing the deployment of these technologies accelerate,” said John Nielsen, an energy analyst with the nonprofit environmental group Western Resource Advocates. “There was slow progress over the last decade, and you’re now seeing this tipping point.”

Among the signs is the arrival of Vestas, a Danish wind turbine company, which announced Friday the construction of two more manufacturing plants and 1,350 new jobs, bringing the company’s total in Colorado to 2,450. Conoco Phillips announced this year that it will locate its alternative-fuels research operation in the state. The Colorado-based National Renewable Energy Laboratory is adding 100 jobs.

Colorado’s growing political and economic commitment to renewables is causing fear in the oil and gas industry, which is fighting to keep its tax breaks and its influence over state rulemaking.

“We’re not feeling very cherished,” said Collins, whose oil and gas association represents more than 30 companies. The group objects to an initiative on the ballot in November; it would eliminate the industry’s 87.5% property tax exemption, estimated to cost the state treasury $230 million to $320 million a year.

If the ballot rule passes, the tax money will be channeled to renewable fuels, wildlife conservation and education. The industry also objects to proposed rules that would require greater public health and environmental protection in areas where drilling takes place.

“It could have been done in a different way, and things wouldn’t have gotten so heated,” Collins said.

Alice Madden, the Democratic majority leader in the Colorado House, looks at the oil and gas industry today and recalls Xcel before the passage of Amendment 37. She has little sympathy for Collins’s arguments, especially at a time when oil and gas profits are soaring.

“It’s Chicken Little all over again: ‘The sky is going to fall,’ ” said Madden, who also chairs Western Progress, an advocacy group. “The oil and gas companies see the writing on the wall, the shift to renewables. They want to make as much money as they can, right now.”

Looking ahead, supporters of alternative fuels are counting on securing some advantages their fossil-fuel predecessors have enjoyed. One request is the renewal of a federal tax credit set to expire this year. Another, Prager said, is “some clear rules on the national level, especially on climate policy.”

With 34,000 active gas wells in Colorado and 28 new permits issued each day, there is no chance that the oil and gas industry will fade away soon. And, as powerfully as the wind blows and the sun shines, the transmission grid for renewable energy is limited and the strength of the current is unsure.

“Unlike a coal plant or a gas plant,” Prager said, “you can’t flip a switch and make the wind blow.”

Read Full Post »

Older Posts »