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Posts Tagged ‘Obama’

MendoCoastCurrent, January 11, 2010

In December, Obama’s Ocean Policy Task Force published it’s Interim Framework and approach for waterways, oceans and all things marine.

WASHINGTON – President Obama’s Ocean Policy Task Force released its Interim Framework for Effective Coastal and Marine Spatial Planning (Interim Framework) today for a 60-day public review and comment period. With competing interests in the ocean, our coasts and the Great Lakes, the Interim Framework offers a comprehensive, integrated approach to planning and managing uses and activities. Under the Framework, coastal and marine spatial planning would be regional in scope, developed cooperatively among Federal, State, tribal, local authorities, and regional governance structures, with substantial stakeholder and public input.

What jumps out at me is the 60-day public REVIEW and COMMENT period.

If you care about our oceans, waterways and coasts, I hope you’ll read the report (read what is interesting to you) and consider commenting, participating. The 60-day public review and comment period ends February 12, 2010.

I’ll be reading it.

To read the Ocean Policy Task Force Releases Interim Framework & more, click on this link and keep digging for the actual report link: http://www.whitehouse.gov/administration/eop/ceq/initiatives/oceans

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MARK CLAYTON, The Christian Science Monitor, September 17, 2009

wave-ocean-blue-sea-water-white-foam-photoWith demands on US ocean resources control growing quickly, the Obama administration today outlined a new comprehensive ocean management plan to guide federal agencies in restoring and protecting a badly stressed US coastal and ocean environment.

Today’s policy shift proposed by the president’s Interagency Ocean Policy Task Force holds enormous potential for sweeping changes in how the nation’s oceans are managed, including energy development, experts say.

At its core, the plan would set up a new National Ocean Council to guide a holistic “ecosystem-based” approach intended to elevate and unify what has long been a piecemeal approach by US agencies toward ocean policy and development — from oil and gas exploration to fisheries management to ship transportation to recreation.

The proposal would include “a more balanced, productive, and sustainable approach to using managing and conserving ocean resources,” Nancy Sutley, chairman of the president’s Council on Environmental Quality told reporters in a teleconference unveiling the plan. It would also set up “a comprehensive national approach to uphold our stewardship responsibilities and ensure accountability for our actions.”

Dr. Sutley, who also chaired the interagency task force, appeared alongside representatives from the Department of Interior, the Coast Guard, the Department of Transportation, and the National Oceanic and Atmospheric Administration. But the proposal would apply to 24 agencies.

“This will be the first time we have ever had this kind of action for healthy oceans from any president in US history,” Sarah Chasis, director of the ocean initiative at Natural Resources Defense Council wrote in her blog. She called it the “most progressive, comprehensive national action for our oceans that we have ever seen.”

The changes could affect new offshore wind energy proposals as well as oil and natural gas exploration. “We haven’t fully looked at all aspects of the report,” says Laurie Jodziewicz, manager of siting policy for the American Wind Energy Association. “The one concern we have is we don’t want to stop the momentum of offshore wind projects we’re already seeing. So while we’re certainly not opposed to marine spatial planning, we would like to see projects already in the pipeline move ahead and start getting some offshore projects going in the US.”

One senior official of the American Petroleum Institute said he had not yet seen the proposal and could not comment on it.

The new push comes at a time when major decisions will be needed about whether and how to explore or develop oil and gas in now-thawing areas of the Arctic Ocean near Alaska. Policy changes could also affect deep-water regions in the Gulf of Mexico as well as the siting of wave power and renewable offshore wind turbines off the East Coast.

At the same time, desalination plants, offshore aquaculture, and liquefied natural gas (LNG) terminals are clamoring for space along coastal areas where existing requirements by commercial shipping and commercial fishing are already in place.

All of that – set against a backdrop of existing and continuing damage to fisheries, coral, coastal wetlands, beaches, and deteriorating water quality – has America’s oceans “in crisis,” in the words of a landmark Pew Oceans Commission report issued in 2003. More than 20,000 acres of wetlands and other sensitive habitat disappear annually, while nutrient runoff creates “dead zones” and harmful algal blooms. Some 30% of US fish populations are overfished or fished unsustainably, the report found.

Among the Interagency Ocean Policy Task Force’s national objectives were:

  1. Ecosystem-based management as a foundational principle for comprehensive management of the ocean, coasts, and Great Lakes.
  2. Coastal and marine spatial planning to resolve emerging conflicts to ensure that shipping lanes and wind, wave, and oil and gas energy development do not harm fisheries and water quality.
  3. Improved coordination of policy development among federal state, tribal, local, and regional managers of ocean, coasts, and the Great Lakes.
  4. Focus on resiliency and adaptation to climate change and ocean acidification.
  5. Pay special attention to policies needed to deal with changing arctic conditions.

Experts said that the new, unified policy was timely, after decades of hit-or-miss development policies.

“We have been managing bits and pieces of the ocean for a long time, but while some good has been done on pollution and resource management, it hasn’t been sufficient.” says Andrew Rosenberg, professor of natural resources at the University of New Hampshire and an adviser to the president’s ocean task force.”This policy shift comes at a critical time for our oceans for so many reasons.”

The new proposal won’t be finalized until next year, after a 30-day comment period that begins now. Still, environmentalists were quick to hail the plan as a critical and timely step to begin healing disintegrating environmental conditions in US coastal waters and in the US exclusive economic zone that extends 200 miles beyond its territorial waters.

In June, President Obama set up the commission to develop: “a national policy that ensures the protection, maintenance, and restoration of the health of ocean, coastal, and Great Lakes ecosystems and resources, enhances the sustainability of ocean and coastal economies.”

It must also, he wrote, “preserve our maritime heritage, provides for adaptive management to enhance our understanding of and capacity to respond to climate change, and is coordinated with our national security and foreign policy interests.”

“It’s the first time the federal government has put out a decent paper that proposes what a national policy and attitude toward our oceans should be,” says Christopher Mann, senior officer Pew Environment Group, the environmental arm of the Pew Charitable Trust.

In one of the more telling passages buried down in its interim report, the task force called for decisions guided by “best available science” as well as a “precautionary approach” that reflects the Rio Declaration of 1992, which states: “where there are threats of serious or irreversible damage, lack of full scientific certainty shall not be used as a reason for postponing cost-effective measures to prevent environment degradation.”

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ALAN OHNSMAN and MAKIKO KITAMURA, Bloomberg, August 12, 2009

honda-clarityHonda Motor Co. is backing hydrogen power for the cars of the future, a stance at odds with the Obama administration’s decision to drop automotive fuel-cell technology in favor of battery-run vehicles.

“Fuel-cell cars will become necessary,” said Takashi Moriya, head of Tokyo-based Honda’s group developing the technology. “We’re positioning it as the ultimate zero-emission car.”

Honda, the only carmaker leasing fuel-cell autos to individuals, opened a production line last year in Tochigi prefecture to make 200 FCX Clarity sedans. The Energy Department sought to eliminate hydrogen-station funding and instead lend $1.6 billion to Nissan Motor Co. and $465 million to Tesla Motors Inc. to build electric cars, and give $2.4 billion in grants to lithium-ion battery makers.

“Honda has a propensity to think very long term,” said Ed Kim, an analyst at AutoPacific Inc. in Tustin, California. “It’s also part of the company culture that if they’ve made a decision they think is correct, they’ll really stick with it.”

Honda isn’t alone. Toyota Motor Corp., Daimler AG, General Motors Corp. and Hyundai Motor Co. say hydrogen, the universe’s most abundant element, is among the few options to replace oil as a low-carbon transportation fuel.

U.S. Energy Secretary Steven Chu said in May his department would “be moving away” from hydrogen as it’s unlikely the U.S. can convert to the fuel even after 20 years. Nissan Chief Executive Officer Carlos Ghosn predicts battery cars may grab 10% of global auto sales by 2020. Honda hasn’t announced plans for a battery-electric car.

Fuel Costs

Hydrogen, made mainly for industrial use from natural gas, costs about $5 to $10 per kilogram for vehicles in California, more than double an equivalent amount of gasoline. Fuel-cell cars also have at least double the efficiency of gasoline models, with Clarity averaging 60 miles per kilogram.

The Energy Department estimates future prices for hydrogen will fall to $2 to $3 a kilogram, Toyota said on Aug. 6.

The fuel can also be made from solar and wind power and even human waste.

Toyota President Akio Toyoda said Aug. 5 his company plans consumer sales of fuel-cell cars within six years. Toyota, like Honda, is making “exponential progress” with the technology, Justin Ward, manager of Toyota’s U.S. advanced powertrain program, said in an interview.

Battery cars are further along in the market. Mitsubishi Motors Corp. started selling the i-MiEV last month. Tesla sells the $109,000 Roadster and Nissan unveiled its electric Leaf this month, with sales to start in Japan and the U.S. next year.

Fueling Time

Honda says hydrogen vehicles match the refueling style drivers are used to: filling up in minutes at a service station. Nissan’s Leaf recharges fully in 30 minutes with a fast-charger, or up to 16 hours on a household outlet, said Tetsuro Sasaki, senior manager of Nissan’s battery test group.

A budget crisis slowed plans for more hydrogen stations in California, home to the biggest fleet of cars using the fuel. At the federal level, Chu sought $333.3 million in May for battery and advanced gasoline autos in the 2010 budget, up 22%. Hydrogen funds were cut 60% to $68 million, slashing money that would have gone to transportation projects.

The Clarity is available in the U.S. only in Los Angeles, where drivers can use as many as 16 hydrogen stations. The 5-passenger car has a top speed of 100 miles an hour and goes 240 miles (386 kilometers), more than double the 100-mile range of Nissan’s compact electric car. Through July, Honda leased cars to 10 drivers for $600 a month.

Filling Stations

The need for a network of hydrogen filling stations is a problem.

“We cannot do infrastructure alone,” said Moriya. “We’ve been developing the cars on our own without government support.”

The Senate and House voted in July to restore the funds. President Barack Obama must approve the final budget.

Honda and Toyota will have to reduce production costs to win over consumers. Fuel cells need platinum — a precious metal that costs more than $1,200 an ounce — and current durability is half that of gasoline engines, according to Moriya.

Honda plans to offer hydrogen-fueled cars at prices comparable to midsize gasoline autos by 2020, down from a company estimate that Clarity’s 2005 hand-built predecessor cost about $1 million. Moriya wouldn’t discuss the Clarity’s price.

Expensive Platinum

Honda engineers in Tochigi are trying to trim costs. For 13 months, technicians have worked in a semiconductor-style clean- room, coating rolls of plastic film for fuel-cell membranes. Nearby, a press stamps stainless-steel plates that will grip the material. Hundreds of the cells are then sealed in a metal case, forming the fuel-cell stack.

Honda’s hydrogen push has been undermined by plunging sales in the U.S., its main market. Last quarter, profit at Japan’s second-largest carmaker fell 96% to 7.5 billion yen ($79 million). Its research budget is 515 billion yen this fiscal year, down 8.5%. Funds for fuel cells were cut and some spending shifted to other “priorities,” Moriya said, without elaborating.

Honda probably spends “a few tens of billions of yen” a year on fuel cells, said analyst Mamoru Kato at Tokai Tokyo Research Center in Nagoya.

“Maybe, just maybe, fuel cells will be the future,” said Edwin Merner, who helps manage about $3 billion at Atlantis Investment Research in Tokyo. “And if you’re not in there, then you have a big disadvantage.”

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Grist via Agence France-Presse, August 6, 2009

ObamaPresident Barack Obama Wednesday unveiled a $2.4 billion funding boost for the development of new generation electric vehicles and slammed critics of his economic rescue plans.

The president traveled to a jobs crisis blackspot in the economically struggling midwestern state of Indiana to announce a plan he said would create tens of thousands of new jobs.

“For far too long we’ve failed to invest in this kind of innovative work, even as countries like China and Japan were racing ahead,” Obama said. “That’s why this announcement’s so important. This represents the largest investment in this kind of technology in American history.”

“This is an investment in our capacity to develop new technologies tomorrow. This is about creating the infrastructure of innovation.”

Obama spoke in a plant that formerly made recreational vehicles (RVs) but that closed down as the recession hit. The factory has since been reopened and is now making RVs and electric hybrid vehicles.

The initiative, funded from the administration’s $787 billion economic crisis bailout, came against a backdrop of shifting political fortunes with Obama’s high opinion ratings eroding and Republican opposition resurgent.

It also came ahead of government jobs data due out on Friday that some analysts believe could see the unemployment rate growing to 9.6%, just short of the politically perilous 10% mark.

Obama’s tactic of appearing outside Washington is designed to place him metaphorically on the side of the people who sent him to power last November, rather than squabbling politicians in the U.S. capital.

“You know, too often there are those in Washington who focus on the ups and downs of politics. But my concern is the ups and downs in the lives of the American people,” Obama said.

He also hit out at critics peddling “misinformation” on his economic recovery plans, which he said were starting to work and transition the U.S. economy out of freefall into a new, more sustainable era.

“There are a lot of people out there who are looking to defend the status quo,” Obama said, touting political reforms to on energy, health care, and economic policy.

“There are those who want to seek political advantage. They want to oppose these efforts—some of them caused the problems that we’ve got now in the first place, and then suddenly they’re blaming other folks for it.”

The $2.4 billion in grants for electric vehicles includes $1.5 billion to U.S. manufacturers to make batteries and components and to expand recycling, officials said.

A further $500 million will go to U.S. firms that produce components for vehicles including electric motors, electronics, and other drive-train items.

The grants gel with a wider Obama administration effort to wean the United States off foreign oil from volatile regions of the world and slice into U.S. greenhouse-gas emissions blamed for global warming.

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MendoCoastCurrent, June 17, 2009

300_127728The West has been at the forefront of the country’s development and implementation of renewable energy technologies, leading the way in passing effective Renewable Portfolio Standards and harnessing the region’s significant renewable energy resources. The initiatives announced at the recent annual western governors’ meeting offered a collaboration of federal and state efforts to help western states continue to lead in energy and climate issues, while driving U.S. economic recovery and protecting the environment.

Secretaries Chu, Salazar and Vilsack and Chairs Sutley and Wellinghoff offered the western state governors next steps to tap renewable energy potential and create green jobs, focusing on energy strategies and initiatives to support their states and constituents.

Included in these initiatives are the development of a smarter electric grid and more reliable transmission system, protection of critical wildlife corridors and habitats, promoting the development of renewable energy sources and laying the groundwork for integrating these energy sources onto the national electricity grid.

“These steps send an unmistakable message: the Obama Administration will be a strong partner with the West on clean energy” Energy Secretary Steven Chu said. “We will create jobs, promote our energy independence and cut our carbon emissions by unlocking the enormous potential for renewable energy in the Western United States”

“Our collective presence here demonstrates the Obama Administration’s commitment to working with the Western governors as we begin to meet the challenge of connecting the sun of the deserts and the wind of the plains with the places where people live” said Ken Salazar, Secretary of the Interior.

“President Obama has been very clear about his intent to address our country’s long-term energy challenges and this multi-department approach will help increase production of energy from renewable sources and generate new, green jobs in the process” said Agriculture Secretary Tom Vilsack. “When we produce more energy from clean sources, we help protect our farmland and our forests for future generations”

“With their focus on clean energy, electricity transmission and Western water supply, the Governors have shown a commitment to addressing the critical issue of climate change and the challenges it presents to state and local governments” said Nancy Sutley, Chair of the White House Council on Environmental Quality. “The areas covered during this meeting, from water supplies and renewable energy, to fostering international cooperation on energy and the environment, are issues we are also focused on at the White House under the leadership of President Obama. We look forward to working together to meet these challenges”

“FERC looks forward to coordinating with DOE and working with the states and local planning entities and other interested parties in the course of facilitating the resource assessments and transmission plans” FERC Chairman Jon Wellinghoff said.

The actions announced include:

$80 Million for Regional and Interconnection Transmission Analysis and Planning:

The Department of Energy announced $80 million in new funding under the American Reinvestment and Recovery Act to support long-term, coordinated interconnection transmission planning across the country. Under the program, state and local governments, utilities and other stakeholders will collaborate on the development and implementation of the next generation of high-voltage transmission networks.

The continental United States is currently served by three separate networks or “interconnections” – the Western, Eastern and Texas interconnections. Within each network, output and consumption by the generation and transmission facilities must be carefully coordinated. As additional energy sources are joined to the country’s electrical grid, increased planning and analysis will be essential to maintain electricity reliability.

Secretary Chu announced the release of a $60 million solicitation seeking proposals to develop long-term interconnection plans in each of the regions, which will include dialogue and collaboration among states within an interconnection on how best to meet the area’s long-term electricity supply needs. The remaining $20 million in funding will pay for supporting additional transmission and demand analysis to be performed by DOE’s national laboratories and the North American Electric Reliability Corporation (NERC).

$50 Million for Assistance to State Electricity Regulators:

Secretary Chu announced $50 million in funding from the American Recovery and Reinvestment Act to support state public utility commissions and their key role in regulating and overseeing new electricity projects, which can include smart grid developments, renewable energy and energy efficiency programs, carbon capture and storage projects, etc. The funds will be used by states and public utility commissions to hire new staff and retrain existing employees to accelerate reviews of the large number of electric utility requests expected under the Recovery Act. Public utility commissions in each state and the District of Columbia are eligible for grants.

Nearly $40 Million to Support Energy Assurance Capabilities for States:

The Department of Energy also announced that $39.5 million in Recovery Act funding will be available for state governments to improve emergency preparedness plans and ensure the resiliency of the country’s electrical grid. Funds will be used by the cities and states to hire or retrain staff to prepare them for issues such as integrating smart grid technology into the transmission network, critical infrastructure interdependencies and cybersecurity. Throughout this process, the emphasis will be on building regional capacity to ensure energy reliability, where states can help and learn from one another. Funds will be available to all states to increase management, monitoring and assessment capacity of their electrical systems.

$57 Million for Wood-to-Energy Grants and Biomass Utilization Projects:

The Department of Agriculture announced $57 million in funding for 30 biomass projects. The projects – $49 million for wood-to-energy grants and $8 million for biomass utilization – are located in 14 states, including Arizona, California, Colorado, Idaho, North Dakota, New Mexico, Nevada, Oregon and Washington.

In keeping with the Obama Administration’s interest in innovative sources for energy, these Recovery Act funds may help to create markets for small diameter wood and low value trees removed during forest restoration activities. This work will result in increased value of biomass generated during forest restoration projects, the removal of economic barriers to using small diameter trees and woody biomass and generation of renewable energy from woody biomass. These funds may also help communities and entrepreneurs turn residues from forest restoration activities into marketable energy products. Projects were nominated by Forest Service regional offices and selected nationally through objective criteria on a competitive basis.

Biomass utilization also provides additional opportunities for removal of hazardous fuels on federal forests and grasslands and on lands owned by state, local governments, private organizations and individual landowners.

Memorandum of Understanding to Improve State Wildlife Data Systems, Protect Wildlife Corridors and Key Habitats across the West:

During today’s Annual Meeting in Park City, Utah, Secretaries Salazar, Vilsack and Chu agreed to partner with the Western Governors’ Association to enhance state wildlife data systems that will help minimize the impact to wildlife corridors and key habitats. Improved mapping and data on wildlife migration corridors and habitats will significantly improve the decision-making process across state and federal government as new renewable and fossil energy resources and transmission systems are planned. Because the development of this data often involves crossing state lines and includes information from both private and public lands, increased cooperation and coordination, like this Memorandum of Understanding (MOU), are important to developing a comprehensive view on the impact of specific energy development options.

Western Renewable Energy Zones Report Identifies Target Areas for Renewable Energy Development:

The Department of Energy and the Western Governors’ Association released a joint report by the Western Renewable Energy Zones initiative that takes first steps toward identifying areas in the Western transmission network that have the potential for large-scale development of renewable resources with low environmental impacts. Participants in the project included renewable energy developers, tribal interests, utility planners, environmental groups and government policymakers. Together, they developed new modeling tools and data to facilitate interstate collaboration in permitting new multistate transmission lines.

In May 2008, the Western Governors’ Association and DOE launched the Western Renewable Energy Zones initiative to identify those areas in the West with vast renewable resources to expedite the development and delivery of renewable energy to where it is needed. Under the Initiative, renewable energy resources are being analyzed within 11 states, two Canadian provinces and areas in Mexico that are part of the Western Interconnection.

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Electric Light & Power, June 11, 2009

menu01onAs the Obama administration shapes its policy on transmission planning, siting and cost allocation, the Large Public Power Council (LPPC) has sent a joint letter voicing its transmission policy views and concerns to Energy Secretary Chu, Interior Secretary Salazar, Agriculture Secretary Vilsack, FERC Chairman Wellinghoff, White House Council on Environmental Quality Chair Sutley and Presidential Energy Advisor Carol Browner.

The letter was sent to the Obama policy makers by Bob Johnston, Chair of the 23 member not-for-profit utility organization. Members of the LPPC own and operate nearly 90% of the transmission investment owned by non-federal public power entities in the United States.

The LPPC told the Obama Administration that it is “most supportive of a framework for interconnection-wide planning that addresses the growing need to interconnect renewable resources to the grid.”

“Many of our members are leaders in renewable deployment and energy efficiency. We are committed to these policy goals and closely tied to the values of our local communities,” the LPPC emphasized. “But we also believe that creating a new planning bureaucracy could be costly and counterproductive in achieving needed infrastructure development.”

The LPPC voiced strong support for the region-wide planning process recently mandated by FERC Order 890 that directed implementation of new region-wide planning processes that the LPPC claims “require an unprecedented level of regional coordination, transparency and federal oversight.”

“It seems quite clear that federal climate legislation and a national renewable portfolio standard will further focus these planning processes, the LPPC asserted. “LPPC fully expects that the regional processes to which parties have recently committed will take on new urgency and purpose. Adding a planning bureaucracy to that mix will be time consuming and will likely delay rather than expedite transmission development.”

The LPPC also told the Obama policy makers that, “it would be unnecessary, inequitable and counterproductive to allocate the cost of a new transmission superhighway to all load serving entities without regard to their ability to use the facilities or their ability to rely on more economical alternatives to meet environmental goals.”

The LPPC contended, “that certain proposals it has reviewed to allocate the cost of new transmission on an interconnection-wide basis would provide an enormous and unnecessary subsidy to large scale renewable generation located far from load centers, at the expense of other, potentially more economical alternatives. Utilities, state regulators, and regional transmission organizations should determine how to meet the environmental goals established by Congress most effectively by making economic choices among the array of available options, without subsidy of one technology or market segment over others.”

The LPPC letter further claimed that the cost of a massive transmission build-out will be substantial and that cost estimates they had reviewed “appear to be meaningfully understated.” The LPPC estimates that nationwide costs for such a build-out “may range between $135 billion and $325 billion, equating to a monthly per customer cost between $14 and $35.  This is a critical matter for LPPC members, as advocates for the consumers we serve.”

The Large Public Power Council letter concluded by offering its support for additional federal siting authority for multi-state transmission facilities “in order to overcome the limited ability of individual states to address multi-state transmission projects to meet regional needs. LPPC is confident that such new authority can be undertaken in consultation with existing state siting authorities in a manner that capitalizes on existing expertise and ensures that state and local concerns are addressed in the siting process.”

The LPPC’s membership includes 23 of the nation’s largest publicly owned, not-for-profit energy systems. Members are located in 10 states and provide reliable, electricity to some of the largest cities in the U.S. including Los Angeles, Seattle, Omaha, Phoenix, Sacramento, San Antonio, Jacksonville, Orlando and Austin.

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Obama+D+Day+sand

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LES BLUMENTHAL, The Bellingham Herald, May 30, 2009

wave-ocean-blue-sea-water-white-foam-photoThe Obama administration has proposed a 25% cut in the research and development budget for one of the most promising renewable energy sources in the Northwest – wave and tidal energy. At the same time the White House sought an 82% increase in solar power research funding, a 36% increase in wind power funding and a 14% increase in geothermal funding. But it looked to cut wave and tidal research funding from $40 million to $30 million.

The decision to cut funding came only weeks after the Interior Department suggested that wave power could emerge as the leading offshore energy source in the Northwest and at a time when efforts to develop tidal power in Puget Sound are attracting national and international attention. By some estimates, wave and tidal power could eventually meet 10% of the nation’s electricity demand, about the same as hydropower currently delivers.

Some experts have estimated that if only 0.2% of energy in ocean waves could be harnessed, the power produced would be enough to supply the entire world. In addition to Puget Sound and the Northwest coast, tidal and wave generators have been installed, planned or talked about in New York’s East River, in Maine, Alaska, off Atlantic City, N.J., and Hawaii. However, they’d generate only small amounts of power.

The Europeans are leaders when it comes to tidal and wave energy, with projects considered, planned or installed in Spain, Portugal, Scotland, Ireland and Norway. There have also been discussions about projects in South Korea, the Philippines, India and Canada’s Maritime provinces.

The proposed cut, part of the president’s budget submitted to Congress, has disappointed Sen. Patty Murray, D-Wash. “Wave and tidal power holds great promise in helping to meet America’s long-term energy needs,” Murray said, adding that Washington state is a leader in its development. “It’s time for the Department of Energy to focus on this potential. But playing budget games won’t get the work done.” Murray’s staff said that while $16.8 billion in the recently passed stimulus bill is reserved for renewable energy and energy efficiency, none of it is earmarked for wave and tidal power.

Energy Department spokesman Tom Welch, however, said the Obama administration is asking for 10 times more for tidal and wave power than the Bush administration did. “The trend line is up,” Welch said. “The department is collaborating with industry, regulators and other stakeholders to develop water resources, including conventional hydro.”

Murray sees it differently. Congress appropriated $40 million for the current year, so the Obama administration proposal actually would cut funding by a fourth. Utility officials involved in developing tidal energy sources said the administration’s approach was shortsighted. “We need all the tools in the tool belt,” said Steve Klein, general manager of the Snohomish County Public Utility District. “It’s dangerous to anoint certain sources and ignore others.”

The Snohomish PUD could have a pilot plant using three tidal generators installed on a seabed in Puget Sound in 2011. The tidal generators, built by an Irish company, are 50 feet tall and can spin either way depending on the direction of the tides. The units will be submerged, with 80 feet of clearance from their tops to the water’s surface. They’ll be placed outside of shipping channels and ferry routes. The pilot plant is expected to produce one megawatt of electricity, or enough to power about 700 homes. If the pilot plant proves successful, the utility would consider installing a project that powered 10,000 homes.

“A lot of people are watching us,” Klein said. The Navy, under pressure from Congress to generate 25% of its power from renewable sources by 2025, will install a pilot tidal generating project in Puget Sound near Port Townsend next year.

In Washington state, law requires that the larger utilities obtain 15% of their electricity from renewable sources by 2020. The law sets up interim targets of 3% by 2012 and 9% by 2016. Most of the attention so far has focused on developing large wind farms east of the Cascade Mountains. Because wind blows intermittently, however, the region also needs a more reliable source of alternative energy.

Tidal and wave fit that need. Also, at least with tidal, the generators would be closer to population centers than the wind turbines in eastern Washington. “The potential is significant and (tidal and wave) could accomplish a large fraction of the renewable energy portfolio for the state,” said Charles Brandt, director of the Pacific Northwest National Laboratory’s marine sciences lab in Sequim.

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Editor’s Note:  On September 21, 2009 FERC Commissioner Suedeen Kelly declined a nomination to serve a second term on the panel. Kelly, a Democratic commissioner nominated by President Obama, said she was leaving her post for the private sector.  A FERC spokeswoman said Kelly would remain in her seat until Congress adjourns later this year.

In her tenure, Kelly has overseen the development of commercial scale renewable energy, the expansion of bid-based regional auction markets for electricity, growth in natural gas pipelines and storage and the birth of the smart grid.

“It is time for me to move on and pursue opportunities to advance these objectives in the private sector,” Kelly said in a statement.

The Senate has still yet to confirm another FERC nominee, John Norris. If the Senate fails to confirm Norris and replace Kelly before it adjourns, it will have only three commissioners sitting: two Republican and one Democrat.

MendoCoastCurrent, March 20, 2009

President Barack Obama has designated Jon Wellinghoff as chairman of the Federal Energy Regulatory Commission (FERC), a position he has held on an acting basis since January.

Wellinghoff is one of two Democrats on the five-member FERC commission.  Separately, the White House said Obama will nominate Commissioner Suedeen Kelly, the panel’s other Democrat, to a third term. Wellinghoff has been on the commission since 2006 and Kelly since 2003.

The Senate confirms commission members, but the president may name its chairman without Senate action.

Here’s the Obama Administration’s FERC Team:

comm_mem

Chairman Jon Wellinghoff, Commissioner Suedeen G. Kelly, Commissioner Philip D. Moeller, Commissioner Marc Spitzer

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Ocean Energy Council, March 17, 2009

fauResearchers in Dania Beach, Fla., landed almost $1.2 million in a federal grant to continue working on an underwater turbine prototype that will use ocean currents to generate power.

Researchers at Florida Atlantic University’s (FAU) Center for Ocean Energy Technology (COET) joined Rep. Ron Klein, D-Fla., today to announced the funding at the SeaTech campus in Dania Beach. The grant is part of the $410 billion spending bill signed by President Barack Obama. This is the first time the project has received federal funds.

The money will help pay for testing and possibly expanding the staff as the Center moves toward making the turbines a commercial product that can be used in offshore areas around the country. Scientists and engineers say these underwater turbines can power buildings along the coastline and eventually become a major energy source.

All the testing to date has been on land while the FAU Center studies underwater conditions and seeks federal and state permits to put the first prototype in the water, possibly this summer.

The Center expects to raise its national profile and get more funding for this and other renewable ocean energy projects, including ocean thermal energy (OTEC) and deep seawater cooling for air conditioning. “This [money] puts us on the radar screen at the federal level,” said Susan Skemp, executive director of the Center.

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EVAN LEHMANN, The New York Times, March 17, 2009

The oceans might not be big enough for sharp-elbowed renewable energy developers. Aspiring power producers are claiming sweeping stretches of sea along the East Coast, sometimes overlapping each other and igniting modern-day allegations of “claim jumping.”

Open water miles from shore is the newest frontier for prospectors, as vague notions persist about who in the federal government presides over the ocean depths. A jurisdictional dispute between two federal agencies — the Department of Interior’s Minerals Management Service and the Federal Energy Regulatory Commission — is encouraging a “Wild West” atmosphere, as one participant described the accelerating race to grab chunks of seafloor for energy development.

The impasse has led competing prospectors to claim the same areas of ocean off New Jersey’s coast, citing authority from different federal agencies. Wind developers are accusing Seattle-based Grays Harbor Ocean Energy Co. of taking advantage of the regulatory uncertainty to snatch a 200-square-mile swath of ocean for a proposed wave and wind energy project through FERC.

Smaller patches within that area had already been identified for wind farms approved by the state and been given a preliminary green light by MMS.

“They are all around us,” Chris Wissemann, founder of Deepwater Wind, said of Grays Harbor. State regulators awarded development rights to Deepwater Wind last fall to build a 350-megawatt wind farm about 20 miles off the shore with PSEG Renewable Generation.

But now the Grays Harbor site is “completely overlapping” the smaller 20-square-mile area of ocean identified by Deepwater Wind, Wissemann added, noting that his project is at “full stop.” The sprawling Grays Harbor parcel also encompasses a second wind project, proposed by Bluewater Wind, which plans to erect about 100 turbines over 24 square miles.

Wind developers and state officials are pressing FERC to deny Grays Harbor’s permit. A decision could come this spring.

‘Wild West’ goes to sea

The confusion is the offspring of dueling federal agencies. The Minerals Management Service is generally considered the landlord of the ocean floor, and has been working for three years on new rules to provide leases for wind farms on the outer continental shelf. There is no dispute about its authority over wind projects, as outlined in the Energy Policy Act of 2005.

But the Federal Energy Regulatory Commission has been arguing for two years that it maintains jurisdiction over hydrokinetic projects — those that tap the power of waves and currents — under the Federal Power Act.

That leaves developers of both wind and wave technologies vulnerable to each other. Preliminary permits are easy to get, and that can lead to “a lot of gamesmanship” in areas known to have good energy prospects, said Carolyn Elefant, a lawyer with the Ocean Renewable Energy Coalition.

“There are a lot of people who have these visions of flipping sites, selling sites, jumping claims and making people buy them off,” she said. “It’s the Wild West.”

That “back and forth” struggle between the two agencies stalled the release of MMS’s new rule on offshore renewable energy projects at the close of George W. Bush’s presidency, according to Michael Olsen, a former deputy assistant secretary in the Interior Department, who worked on the rule. Developers say the delay has prevented the offshore industry from growing.

“There was a tremendous push at the end of the last administration” to finalize the rule, Olsen said an event sponsored by the Energy Bar Association yesterday. “And it was delayed because of this dispute.”

‘Permit flippers’ vs. ‘mafiosos’

Grays Harbor is at the center of that storm. Run by Burton Hamner, who has experience in coastal management, the company in October plunged into the race to build the first offshore power generation project on the East Coast.

It applied for six interim leases from FERC, a move that would give it priority over hundreds of square miles off the coasts of Massachusetts, New Jersey, Rhode Island and several other states. The move could essentially secure those areas for three years, sidelining other wind companies that had already gone through a competitive selection process with the state of New Jersey and that are now waiting on the MMS rule before moving forward.

“I could literally have my equipment on a boat and receive a letter from FERC saying, ‘You have no right to do this because we have a competing set of regs,'” said Wissemann of Deepwater Wind, which might wait to build a data-collecting test tower until the dispute is settled.

A group of nine U.S. lawmakers, mostly from the East Coast, assailed Grays Harbor’s move — without mentioning the company — as “claim jumping” in a letter last week to Interior Secretary Ken Salazar. Some wind developers are furious, saying Hamner is “site banking” stretches of ocean with an eye toward trading in real estate, not clean energy.

“They’re looking to flip the permits,” said one official with a wind developer.

But Hamner dismisses those accusations as if they’re insults from entitled lawmakers or bested competitors acting like bossy “New Jersey mafiosos.”

Salazar pushing for a fix

He describes his maneuvering as a good business decision, one that fits within existing rules. He is not a claim jumper, he says, because MMS has not issued the rule needed to receive leases — an assertion with which his competitors have no choice but to agree.

“You can’t say somebody else is claim jumping when you haven’t in fact made a claim,” Hamner said. “All they’re doing is sitting there on the shore saying, ‘Hey, we were here first. What’s this guy doing messin’ in our sandbox?'”

He is unapologetic about applying for interim permits under FERC, days after the commission underscored its jurisdiction over hydrokinetic (wave power) projects in October. Nor does he feel burdened by exploiting the turf battle in Washington. FERC, he says, is the rightful overseer of electricity projects.

“They could have done the same thing that I did,” Hamner said of other developers. “The ocean’s got a lot of opportunity. There’s room for everybody. What we don’t want to have is people standing on the shore who’ve got the attitude of New Jersey mafiosos saying that’s their playground.”

Hamner is eligible for a FERC permit because he’s emphasizing wave power. At each of his seven sites, he proposes raising 100 platforms, each with three legs. Every leg will carry a 330-kilowatt generator, providing about 10% of the 1,100 megawatts produced by each project. Hamner plans to find the bulk of his electricity through wind turbines, big, 10-megawatt units on each platform.

The territorial dispute, meanwhile, is rising to a new level of urgency in Washington. Salazar said he hopes to draft a long-delayed memorandum of understanding with FERC, perhaps as soon as today. That could prevent the agencies from “stumbling over each other,” he told reporters on a conference call yesterday.

“We will not let any of the jurisdictional turf battles in the past get in the way with moving forward with our energy agenda,” Salazar said.

The MMS rule regarding leases could follow soon if the inter-agency dispute is settled. That’s considered a key requirement for sparking a robust offshore industry.

“They just need to work it out,” said Laurie Jodziewicz, manager of siting policy for the American Wind Energy Association. “We have some real projects that are being held up right now.”

Yet Olsen, the former official with Interior who worked on the rule, expressed doubt yesterday that Salazar would be able to quickly disarm the two sides. Congress might have to draft new legislation, he predicted, or perhaps President Obama’s new energy czar, Carol Browner, could muscle a jurisdictional remedy into place.

“It’s going to be the same thing,” Olsen said, recalling past challenges to fixing the problem. “Something’s gotta happen.”

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H. JOSEF HEBERT, The Associated Press, March 16, 2009

While the Obama administration has touted offshore renewable energy development, a turf fight between two federal agencies has stymied the government’s ability to issue rules needed to approve wind energy projects off America’s coasts.

Interior Secretary Ken Salazar said Monday the infighting has got to stop.

“It will be resolved,” Salazar said in response to questions about the dispute. “We will not let any of the jurisdictional turf battles of the past get in the way of our moving forward with the renewable energy agenda.”

The dispute, which dates to late 2007, pits the Interior Department against the Federal Energy Regulatory Commission over which entity should approve projects that use coastal waves and currents to produce power.

Offshore wind development has been entangled in the dispute because Interior’s Mineral Management Service does not want to separate wind projects from the tidal wave, or hydrokinetic power, programs – which FERC in turn has refused to surrender, according to several officials who have followed the dispute.

Interior and FERC are said to be close to agreement on a “memorandum of understanding” that would delineate each organization’s involvement in the offshore renewable energy approval process.

Salazar has been vocal in his call for more aggressive development of renewable energy projects off the country’s coasts, especially off the northern and central Atlantic. He said the governors of New Jersey and Delaware have asked what is holding up the regulations and said projects off their coasts are ready to go.

Jon Wellinghoff, acting chairman of FERC, played down the interagency dispute and – like Salazar – said he was confident the problem will soon be worked out.

“It’s less of a dispute than people say it is,” insisted Wellinghoff in a brief interview, adding that he doubted it has stopped any wind projects.

“It has nothing to do with wind. It only has to do with our jurisdiction over hydrokinetic systems, whether they are on the Outer Continental Shelf or not,” said Wellinghoff. He said he saw no reason why the Mineral Management Service would insist on viewing the tidal wave and wind issues together.

Salazar over the past week met with Wellinghoff to try to work out a memorandum of understanding that could be issued as early as this week. Both men are expected to be asked about the disagreement at a Senate Energy and Natural Resources Committee hearing Tuesday.

“If we don’t resolve the jurisdictional issues between FERC and the Department of Interior, we are not going to be able to move forward in the development of our offshore renewable energy resources,” said Salazar.

Mike Olsen, an attorney who represents Deep Water Wind, a company that wants to build a 96-turbine wind farm off the New Jersey coast, calls the dispute a classic government turf battle.

“It’s two agencies both feeling each has specific authority and jurisdiction. Neither one wants to yield its authority or jurisdiction to the other,” said Olsen, who as a deputy assistant Interior secretary in the Bush administration observed the dispute first hand.

Interior waged “a full court press” to get the rules on offshore renewable energy development finalize last year, Olsen said, but the effort was thwarted by the lack of an agreement with FERC.

“From our perspective the rule was ready to go in November,” said Olsen. But despite involvement of the Bush White House, no memorandum of understanding on the jurisdiction issue could be hammered out between Interior and FERC.

With a new administration on the horizon “the battle was put on hold,” he said.

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MARSHA W. JOHNSTON, RenewableEnergyWorld.com, March 2009

One hundred and forty-one years ago, the relentless sea off Scotland’s coast inspired the following observation from native son and author George MacDonald:

I climbed the heights above the village, and looked abroad over the Atlantic. What a waste of aimless tossing to and fro! Gray mist above, full of falling rain; gray, wrathful waters underneath, foaming and bursting as billow broke upon billow…they burst on the rocks at the end of it, and rushed in shattered spouts and clouds of spray far into the air over their heads. “Will the time ever come,” I thought, when man shall be able to store up even this force for his own ends? Who can tell.”

In the United States, permitting may be an even bigger hurdle to marine energy deployment than financing. Between 25 and 35 different U.S. federal, state and local regulatory agencies claim some jurisdiction over marine power deployment. In the UK, two agencies handle permitting.

Today, we can certainly say, “Yes, the time will come.” The only question remaining is how long it will be before humankind routinely and widely uses electricity generated from the kinetic power of ocean tides, currents and waves.

If one defines “commercial ocean energy” as several tens of megawatts, the world cannot yet boast a commercial ocean energy installation. Indeed, only two installations of either wave, tidal or in-stream current devices are grid-connected and can generate over 1 megawatt (MW) of power. One is Pelamis Wave Power’s 2.25-MW Aguçadoura project off of Portugal’s northern coast and the other is Bristol-based Marine Current Turbines’ (MCT) SeaGen, a US $20-million commercial-scale tidal-energy project under development in Northern Ireland’s turbulent Strangford Narrows. In December, SeaGen boasted the first tidal turbine to hit a capacity of 1.2 MW.

(The biggest exception to commercial ocean energy production is the world’s longest running tidal power plant, the 240-MW La Rance, in France. But the plant’s barrage technology, which traps water behind a dam and releases it at low tide, has fallen out of favor due to its perceived higher environmental impact than underwater turbines. Nova Scotia has also been operating a 20-MW barrage Tidal Generating Station in the tidal-rich Bay of Fundy since 1984.)

The rest of the world’s wave, tidal and current installations, some of which have been in the water as far back as the 1990s, are experimental and prototype units ranging in size from 35 kilowatts (kW) to 400 kW. Because these units operate only intermittently and are not typically connected to any grid, it is not possible to determine their total power generation.

Many of these units are prototype demonstration units for the much bigger installations that are under development and that will begin to realize significant exploitation of the world’s ocean energy resource. For example, Ocean Power Technologies Inc. will use the 150-kW PowerBuoy it has been testing since the mid-90s as the “workhorse” for the 270-MW, four-site wave energy plant off California and Oregon coasts that it has partnered with Lockheed Martin to develop, says CEO George Taylor.

And Inverness, Scotland-based WaveGen expects to use 40 units of the 100-kw turbine it just installed off the Island of Islay for a 4-MW farm off of Scotland’s Isle of Lewis. Meanwhile, Pelamis says if its 750-kw “sea snake” devices, which were installed last year, make it through the winter, it will put 37 more of them in the water, generating 30 MW.

All of the wave, tidal, ocean and river current power around North America that can be practically extracted could together provide 10% of today’s electrical consumption in the U.S., says Roger Bedard, ocean energy leader at the Electric Power Research Institute (EPRI) in Palo Alto, CA. He adds that the total water resource could, it is sometimes said, possibly power the world twice over, but a lot of it is out of reach. “Hudson’s Bay, off the Arctic Circle, has HUGE tidal power, but it is thousands of miles from where anyone lives. We have HUGE wave resources off Aleutian Islands, but the same problem,” he says.  See EPRI’s U.S. Offshore Wave Energy Resource Map, below.

What will be the “magic” year for large-scale ocean energy deployment? Most developers indicate 2011-2012. Trey Taylor, co-founder and president of Verdant Power, which is moving into the commercial development phase of its 7-year-old Roosevelt Island Tidal Energy project, says the firm aims to have “at least 35 MW” in the water by the end of 2011.

Bedard is more circumspect. “I think it will be 2015 in Europe and 2025 in U.S. for big deployment,” he says, adding that the year cited depends entirely on the definition of “big” and “commercial,” which he defines as “many tens of megawatts.”

Verdant’s Taylor expects greater initial success in Canada. “The fundamental difference between Canada and the U.S. is that the underpinning of processes in Canada is collaborative and in the U.S. it is adversarial. It’s just the nature of Canadians, collaborating for community good, whereas in the U.S. people are afraid of being sued,” he said.

Bedard says the U.S. could catch up to Europe earlier, if the Obama Administration walks its big renewable energy infrastructure investment talk. “But if it’s business as usual, it could be later, depending on the economy,” he says.

Since the global economy began to melt down last September, many ocean energy companies have had to refocus their investment plans. With venture capital and institutional monies drying or dried up, firms are turning to public funds, strategic partners such as utilities and big engineering firms, and angel investors.

In November, MCT retained London-based Cavendish Corp Finance to seek new financing. Raymond Fagan, the Cavendish partner charged with MCT, said although tidal energy is not as advanced as wind or solar, he has seen a “strong level of interest so far from large engineering-type firms in MCT’s leading position.” Because MCT holds patents and is delivering power to the grid ahead of its competitors, Fagan thinks Cavendish can bring it together with such strategic partners.

In addition to the economic climate, he notes that the drop in oil and gas prices is further slowing renewable energy investment decisions. “Six to 12 months ago, people were leaping into renewable energy opportunities,” he says, adding that the UK government’s recent call for marine energy proposals for the enormous Pentland Firth zone north of Scotland will improve Cavendish’s chances of getting financing. Though it has yet to make a public announcement, MCT is widely viewed as a prime operator for the zone.

Monies are still available. Witness Pelamis Wave Power’s infusion of 5 million pounds sterling in November, which it says it will use for ongoing investment in core R&D and continuing development of its manufacturing processes and facilities.

In the U.S., permitting may be an even bigger hurdle to marine energy deployment than financing. Between 25 and 35 different U.S. federal, state and local regulatory agencies claim some jurisdiction over marine power deployment. In the UK, two agencies handle permitting. Bedard notes however, that streamlining the process in the U.S. may have begun with the recent opening of a new six-month process for licensing pilot marine energy plants.

Marine energy experts agree that there are more opportunities for wave power than for tidal, as there are simply fewer exploitable tidal sites. In technology terms, however, tidal turbines have benefited from a quarter century of wind turbine development, says Virginia Tech professor George Hagerman. Despite more widely available wave resource, wave energy developers face the challenge of needing many more devices than do tidal energy developers, and have a higher cabling cost to export the power.

As Christopher Barry, co-chair of the Ocean Renewable Energy panel at the Society of Naval Architects and Marine Engineers, explains: “The major challenge [to ocean energy] is not pure technology, but the side issues of power export and making the technology affordable and survivable.”

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CHRIS NEWKUMET, Platts.com, March 9, 2009

kelliherUS Federal Energy Regulatory Commission member Joseph Kelliher on Monday said he will leave the agency March 13.

Kelliher was chairman of FERC from July 9, 2005, until January 22, 2009, and has served at the commission since November 20, 2003.

Just before the inauguration of President Barack Obama, Kelliher announced he would surrender the gavel to a chairman of Obama’s choice, which turned out to be Jon Wellinghoff, who is serving on an acting basis.

With a change in political party in the White House, the FERC chairman typically leaves the commission within weeks of the inauguration, regardless of how much time is left on his term.

Although Kelliher’s term as a commissioner does not end until June 2012, he stopped participating in all official commission business when he stepped down as chairman.

Under the commission’s ethics rules, sitting commissioners are required to recuse themselves from cases that may impact a potential employer with whom the commissioner is discussing future employment.

On the five-member commission, administrative rules allow for a three-member majority reflecting the president’s party, including the chairmanship. While all commissioners must be confirmed by the Senate, the chairman is simply designated by the White House in a letter setting out the president’s choice.

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wave-ocean-blue-sea-water-white-foam-photoMendoCoastCurrent, February 14, 2009

Acting Federal Energy Regulatory Commission (FERC) Chairman Jon Wellinghoff recently published Facilitating Hydrokinetic Energy Development Through Regulatory Innovation

Consider it required reading as a backgrounder on US wave energy policy development, FERC’s position on the MMS in renewables and FERC’s perceived role as a government agency in renewable energy, specifically marine energy, development.

Missing from this key document are the environmental and socio-economic-geographic elements and the related approval process and regulations for:

  • environmental exposure, noting pre/during/post impact studies and mitigation elements at each and every marine energy location;
  • socio-economic factors at each and every marine location (including a community plan with local/state/federal levels of participation).

Approaching the marine renewable energy frontier with a gestalt view toward technology, policy and environmental concerns is a recommended path for safe exploration and development of new renewable energy solutions.  

It has been FERC’s position that energy regulatory measures and policies must precede before serious launch of US projects and other documents by Wellinghoff have noted a six month lead time for policy development alone.

MendoCoastCurrent sees all elements fast-tracked in tandem.  Environmental studies/impact statements are gathered as communities gear up to support the project(s) while technology and funding partners consider siting with best practices and cost-efficient deployment of safe marine energy generation.  All of these elements happen concurrently while FERC, DOI/MMS, DOE local and state governments explore, structure and build our required, new paradigm for safe and harmonious ocean energy policies.

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MendoCoastCurrent from Platts Energy Podium, February 12, 2009

The recently approved Economic Stimulus Plan includes expanding the US electric transmission grid and this may be the just the start of what will be a costly effort to improve reliability and deliver renewable energy to consumers from remote locations, Federal Energy Regulatory Commission (FERC) Acting Chairman Jon Wellinghoff told the Platts Energy Podium on February 12, 2009.

Wellinghoff defines the Stimulus energy funds as “seed money. But it really isn’t [enough] money to make huge advances in the overall backbone grid that we’re talking about to integrate substantial amounts of wind.”

While details of the plan compromises are unclear, the measure could provide $10 billion or more to transmission upgrades. Wellinghoff said backbone transmission projects could cost more than $200 billion. “And I think we’ll see that money coming from the private sector,” based on proposals already submitted to FERC.

Wellinghoff’s focused on Congress strengthening federal authority to site interstate high-voltage electric transmission lines to carry wind power to metropolitan areas and expects FERC to be heavily involved in formulation of either a comprehensive energy bill or a series of bills meant to address obstacles to increasing renewable wind, solar and geothermal energy, and other matters that fall within FERC’s purview. 

FERC plays a critical role “given the authorities we’ve been given in the 2005 and 2007 acts and our capabilities with respect to policy and implementation of energy infrastructure.”

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DANIEL B. WOOD, The Christian Science Monitor, February 11, 2009

Less than a month into his administration, President Obama is making good on campaign promises to move toward a comprehensive approach to US energy and to broaden environmental protections. The administration has moved over the past few weeks to undo many of Bush’s last-minute drilling and environmental decisions, including putting the brakes Tuesday on a plan to open up vast new areas off the Atlantic and Pacific coasts to offshore drilling.

In swift succession, the Obama administration has:

  • Ordered the Environmental Protection Authority to reconsider its decision to deny California permission to set standards controlling greenhouse-gas emissions from motor vehicles – if permitted, this would allow 13 more states to follow suit.
  • Abandoned a Bush administration legal appeal in a major air pollution case – signaling it will allow tougher rules to cut mercury emissions from power plants.
  • Canceled 77 Bush-era oil and gas leases over 100,000 acres of public land near national parks in Utah.
  • Announced an intent to develop an offshore energy plan that includes renewable resources, giving states and the federal government more time to study and assess the future of offshore energy planning.

“There’s clearly a new kid in town. The Obama administration is moving quicker on the environment than anything else,” says Robert Stern, president of the Center for Governmental Studies. “They are concerned that untoward things are going to happen before they can get new policies in place, so they are trying to reverse old ones.”

In the most recent move to stall Bush policy, Interior Secretary Ken Salazar announced Tuesday that the time period for public comment on a draft five-year plan for offshore oil and gas leasing would be extended for another 180 days. He also ordered the US Geological Survey and the Minerals Management Service to develop an extensive profile of the nation’s resources offshore.

The plan, which was proposed by the Bush administration on its last day in office and published the day after President Obama took office, originally allowed 45 days for scoping and comment.

Describing the plan as “a headlong rush of the worst kind,” Mr. Salazar said that “Bush’s “midnight action” accelerated by two years the regular process for creating a new plan for the outer continental shelf.

“It opened up the possibility for oil and gas leasing along the entire Eastern Seaboard, portions of offshore California, and the far eastern Gulf of Mexico, with almost no consideration of state, industry, and community input and … with very limited information about the nature of offshore resources,” he said.

The new administration will look at offshore drilling as part of a comprehensive energy plan, he said. The changes are to “fulfill President Obama’s commitment to a government that is open and inclusive and makes decisions based on sound science and the public interest.”

“I intend to do what the Bush administration refused to do; build a framework for offshore renewable-energy development so that we incorporate the great potential for wind, wave, and ocean current energy into our offshore energy strategy.”

In a similar move last week, the Interior secretary announced that the Bureau of Land Management would withdraw drilling leases that were offered on 77 parcels of US public land near national parks in Utah. The leases, on land totaling 103, 225 acres, are under litigation in district court.

Development of oil and gas supplies was needed to help reduce dependence on foreign oil, but it must be done in a “thoughtful and balanced way that allows us to protect our signature landscapes and culture resources,” said Salazar, adding that the BLM would return $6 million in bids from an auction last December.

Also last week, the Justice Department said it is withdrawing a US Supreme Court appeal filed by the Bush administration against a court ruling governing mercury emissions from coal- and oil-fired power plants.

The Obama administration has also told the EPA to reconsider denying California the power to regulate vehicular pollution. The Bush administration’s EPA in 2007 had denied California the waiver needed to authorize its special status under the Clean Air Act. That law gives California the authority to regulate vehicular pollution because the state began doing so before the federal government did.

Leading environmental groups, which were often at odds with Bush, are breathing a palpable sigh of relief. “We are encouraged by Obama’s announcement that he is going to restore order to a broken system and that is what this is,” says Kristina Johnson, deputy press secretary for the Sierra Club.

“This five-year offshore drilling program that Bush tried to push through wasn’t based on sound science, and there was no public input,” she said. “It’s part of a new way of doing business. [The Obama administration understands] that the answer to America’s energy problems isn’t more drilling and that we need to be investing in clean energy.”

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MendoCoastCurrent, February 11, 2009

President Obama chose two Silicon Valley notables as members of his new Economic Recovery Advisory Board.  The 15-member board shall advise Obama on decisions about the US economy and announced to spur Congress into passing legislation for his economic stimulus plan.

President Obama said he created a panel of outside advisers to enlist voices from “beyond the Washington echo chamber.”

Among his picks is Charles Phillips, president of Oracle and John Doerr, a Silicon Valley venture capitalist who serves on the boards of Google, Amazon, and Symantec.

“We will meet regularly so that I can hear different ideas and sharpen my own, and seek counsel that is candid and informed by the wider world.”

The board is headed by Paul Volcker, the former US Federal Reserve chairman and one of Obama’s top economic advisers.

“We’re also going to count on these men and women to serve as additional eyes and ears for me as we work to reverse this downturn,” said Obama. “Many of them have a ground-level view of the changes that are taking place.”

Phillips became president of Oracle in May 2003 and was previously with (the then-investment bank and now-bank holding company), Morgan Stanley.

Doerr is a venture capitalist associated with KPCB, who’s backed quite a few big names of Silicon Valley in their early years. Like Compaq, Sun Microsystems, Intuit, Netscape, and Amazon. He’s also been a major advocate for carbon trading and green tech causes.

Other names on the board include Martin Feldstein, professor of economics at Harvard University; Jeffery Immelt, CEO of General Electric; and Robert Wolf, CEO of investment bank UBS Group Americas.

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KATE GALBRAITH, The New York Times, February 4, 2009

imagesWind and solar energy have been growing at a blistering pace in recent years, and that growth seemed likely to accelerate under the green-minded Obama administration. But because of the credit crisis and the broader economic downturn, the opposite is happening: installation of wind and solar power is plummeting.

Factories building parts for these industries have announced a wave of layoffs in recent weeks, and trade groups are projecting 30 – 50% declines this year in installation of new equipment, barring more help from the government.

Prices for turbines and solar panels, which soared when the boom began a few years ago, are falling. Communities that were patting themselves on the back just last year for attracting a wind or solar plant are now coping with cutbacks.

“I thought if there was any industry that was bulletproof, it was that industry,” said Rich Mattern, the mayor of West Fargo, N.D., where DMI Industries of Fargo operates a plant that makes towers for wind turbines. Though the flat Dakotas are among the best places in the world for wind farms, DMI recently announced a cut of about 20% of its work force because of falling sales.

Much of the problem stems from the credit crisis that has left Wall Street banks reeling. Once, as many as 18 big banks and financial institutions were willing to help finance installation of wind turbines and solar arrays, taking advantage of generous federal tax incentives. But with the banks in so much trouble, that number has dropped to four, according to Keith Martin, a tax and project finance specialist with the law firm Chadbourne & Parke.

Wind and solar developers have been left starved for capital. “It’s absolutely frozen,” said Craig Mataczynski, president of Renewable Energy Systems Americas, a wind developer. He projected his company would build just under half as much this year as it did last year.

The two industries are hopeful that President Obama’s economic stimulus package will help. But it will take time, and in the interim they are making plans for a dry spell.

Solar energy companies like OptiSolar, Ausra, Heliovolt and Sun Power, once darlings of investors, have all had to lay off workers. So have a handful of companies that make wind turbine blades or towers in the Midwest, including Clipper Windpower, LM Glasfiber and DMI.

Some big wind developers, like NextEra Energy Resources and even the Texas billionaire T. Boone Pickens, a promoter of wind power, have cut back or delayed their wind farm plans.

Renewable energy sources like biomass, which involves making electricity from wood chips, and geothermal, which harnesses underground heat for power, have also been slowed by the financial crisis, but the effects have been more pronounced on once fast-growing wind and solar.

Because of their need for space to accommodate giant wind turbines, wind farms are especially reliant on bank financing for as much as 50 percent of a project’s costs. For example, JPMorgan Chase, which analysts say is the most active bank remaining in the renewable energy sector, has invested in 54 wind farms and one solar plant since 2003, according to John Eber, the firm’s managing director for energy investments.

In the solar industry, the ripple effects of the crisis extend all the way to the panels that homeowners put on their roofs. The price of solar panels has fallen by 25% in six months, according to Rhone Resch, president of the Solar Energy Industries Association, who said he expected a further drop of 10% by midsummer. (For homeowners, however, the savings will not be as substantial, partly because panels account for only about 60% of total installation costs.)

After years when installers had to badger manufacturers to ensure they would receive enough panels, the situation has reversed. Bill Stewart, president of SolarCraft, a California installer, said that manufacturers were now calling to say, “Hey, do you need any product this month? Can I sell you a bit more?”

The turnaround reflects reduced demand for solar panels, and also an increase in supply of panels and of polysilicon, a crucial material in many panels.

On the wind side, turbines that once had to be ordered far in advance are suddenly becoming available.

“At least one vendor has said that they have equipment for delivery in 2009, where nine months ago they wouldn’t have been able to take new orders until 2011,” Mr. Mataczynski of Renewable Energy wrote in an e-mail message. As he has scaled back his company’s plans, he has been forced to cancel some orders for wind turbines, forfeiting the deposit.

Banks have invested in renewable energy, lured by the tax credits. But with banks tightly controlling their money and profits, the main task for the companies is to find new sources of investment capital.

Wind and solar companies have urged Congress to adopt measures that could help revive the market. But even if a favorable stimulus bill passes, nobody is predicting a swift recovery.

“Nothing Congress does in the stimulus bill can put the market back where it was in 2007 and 2008, before it was broken,” said Mr. Martin, the tax lawyer with Chadbourne & Parke. “But it can help at the margins.”

The solar and wind tax credits are structured slightly differently, but the House version of the stimulus bill would help both industries by providing more immediate tax incentives, alleviating some of their dependency on banks.

Both House and Senate would also extend an important tax credit for wind energy, called the production tax credit, for three years; previously the industry had complained of boom-and-bust cycles with the credit having to be renewed nearly every year.

Over the long term, with Mr. Obama focused on a concerted push toward greener energy, the industry remains optimistic.

“You drive across the countryside and there’s more and more wind farms going up,” said Mr. Mattern of West Fargo. “I still have big hopes.”

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SUSAN CHAMBERS, The World, February 4, 2009

coos-bay-intro2Coos Bay, Oregon — The jobs are coming, so Ocean Power Technologies insists.

OPT spokesman Len Bergstein said Monday the company wants to get stimulus funds from the federal government.

“We have a strong interest in presenting a project that would be jobs-ready right now,” Bergstein said.

OPT wants to get a test buoy in the water soon. It recently formed an agreement with Lockheed Martin in which Lockheed would provide construction, systems integration and deployment work, according to a press release.

The announcement last week followed on a similar report from Oregon Iron Works in Clackamas and American Bridge in Reedsport that said they plan to share buoy construction work, if Oregon Iron gets OPT’s contract.

Bergstein said the Lockheed agreement is for higher level technical, systems integration work.

“It would not replace work on the coast,” he said.

OPT has said it hopes to get a buoy in the water this year and to submit plans to the Federal Energy Regulatory Commission and the federal government in March.

The Obama administration recently put together the White House Task Force on Middle Class Working Families, chaired by Vice President Joe Biden, to boost the living standards of the country’s middle class. Its first focus is green jobs, those that use renewable energy resources, reduce pollution, conserve energy and natural resources and reconstitute waste. The task force’s first meeting is Feb. 27.

If the community can get behind OPT’s plans, Bergstein said, the company could submit it to the task force.

“We want to demonstrate that wave energy projects are the kinds of things that can bring jobs to coastal communities,” he said. “Nothing could say that better than being part of a stimulus package.”

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MendoCoastCurrent, January 29, 2009

images2At his first White House press conference, President Obama declared “the days of Washington dragging its heels are over” and ordered an immediate review of the Bush administration’s refusal to give California authority to enforce tougher emission and fuel efficiency standards on gas and diesel automobiles.

For more than two years California Governor Schwarzenegger has sought to impose stricter standards on automobile manufacturers in an effort to spur adoption of plug-in electric cars.

President Obama’s order may signal his interest in granting California’s request in a matter of weeks. Eighteen other States, representing nearly half the nation’s population, have indicated they wish to follow California’s lead, calling for the establishment of a national electric car-charging network.

President Obama’s push for electric cars is closely linked to his $11 billion high voltage “superhighway” that was passed last night by the House included in the $819 billion economic stimulus.

The newly-chosen, Acting Chairman of the Federal Energy Regulatory Commission (FERC), Jon Wellinghoff, is calling for regulators and automobile manufacturers to plan integration in the car-charging networks for electric vehicles into the national power grid. “If you’re an automobile company, you’d better get on the bandwagon…because there is definitely going to be a move toward electrification,” said Wellinghoff.  Chip manufacturers and power companies may also wish to jump in.

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Editors Note:  On May 11, 2009, PG&E pulled-out of Mendocino WaveConnect, read it here: http://tinyurl.com/qwlbg6 . The remains of the $6M are now solely allocated to Humboldt WaveConnect.

MendoCoastCurrent, January 29, 2009

wave-ocean-blue-sea-water-white-foam-photoPG&E caught a major renewable energy wave today as the California Public Utilities Commission approved $4.8 million in funding their centerpiece wave energy project, WaveConnect. The program also received an additional $1.2 million in matching funds from the Department of Energy. PG&E’s WaveConnect, a project already two years in the making, launches with a $6M kitty.

WaveConnect is chartered with exploring wave energy development off the coasts of Mendocino and Humboldt counties in Northern California. The stakeholders in this region are dyed-in-the-wool political activists, living in environmentally-centric coastal communities and have reacted protectively, sounding alarms that PG&E and the Federal government’s wave energy plans may foul, diminish and destroy the Pacific Ocean and marine life.

Over the two years that PG&E and the Federal Energy Regulatory Commission (FERC) advanced WaveConnect, only recently have environmental concerns and study become part of the discussion. The opportunity for Mendocino and Humboldt coastal communities and local governments to embrace wave energy development and connect with WaveConnect has not gone well, especially as the Federal Energy Regulatory Commission (FERC) has disallowed the City of Fort Bragg and local fishermen to be party in the WaveConnect FERC Preliminary Permitting.

Jonathan Marshall, publisher of Next100, a PG&E blog, wrote “PG&E’s first step will be to conduct meetings with local stakeholders and agencies to learn about their issues and concerns. After completing appropriate environmental reviews and permit applications, which could take a couple of years, PG&E then plans to build an undersea infrastructure, including power transmission cables, to support wave energy demonstration projects. The utility will then invite manufacturers of wave energy devices to install them offshore for testing and comparison.”

“The anticipated cost of wave power compares favorably to the early days of solar and wind,” says William Toman, WaveConnect project manager at PG&E. “It will take several stages of design evolution to lower costs and increase reliability.” The CPUC and the DOE are betting on this evolution as in this funding scenario engineered by PG&E, the CPUC awards $4.8M in ratepayer funds while the DOE $1.2M is a matching grant.

Wave energy may become a key source of renewable energy in California. It’s proposed that the 745-mile coastline could produce 1/5th of California’s energy needs if, admittedly a big if, economic, environmental, land use and grid connection issues — and community issues — don’t stand in the way.

Marshall wrote in closing “Making ocean power technology work reliably and at a competitive price will be the first big challenge. Serving offshore installations with power transmission lines will be another economic and engineering hurdle. Finally, ocean power developers must also convince local communities and government regulators that their installations will not destroy marine life, cause boating collisions or navigational hazards, or degrade ocean views.”

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STEPHEN POWER, The Wall Street Journal, January 28, 2009
images1Interior Secretary Ken Salazar indicated Tuesday that the Obama Administration could be open to expanded offshore drilling and is considering doing away with a controversial program that allows oil companies to pay in kind for oil and natural gas taken from public lands.

Salazar inherited a Bush Administration plan that would open tracts off the Atlantic and Pacific coasts where drilling had previously been prohibited. Environmental groups want the Obama administration to re-impose a ban on expanded offshore drilling that President George W. Bush lifted last year.

Asked in an interview with The Wall Street Journal whether President Barack Obama might try to reinstate the ban, Salazar paused 18 seconds before saying: “I don’t know.”

“We have significant drilling already in many places of the Gulf coast. We have drilling in many places off the Alaska shorelines. There are other places that hold potential for exploration. We’ll develop our guidelines as to how we’re going to look at it. But we’re still at the beginning of an information-gathering process,” he said.

Asked about the Bush administration’s proposal to open certain areas of the Atlantic and Pacific coasts to drilling and whether he saw any opportunities for expanded development of the nation’s offshore areas, Salazar said: “When you look at the whole [outer continental shelf], it’s a huge potential. And it has to be done carefully. We don’t want to ruin the beaches of Florida and the coastlines of other places that are sensitive.”

“On the other hand, there are places where it may be appropriate for us to have reconnaissance and exploration and even development. Those are questions that we are exploring and hopefully over the months ahead we’ll have answers to these questions,” he said.

Salazar left the door open to curtailing the “royalty-in-kind” program, under which the government receives oil or natural gas instead of cash for payments of royalties from companies that lease federal property for oil and gas development, and then sells the product into the marketplace and returns the proceeds to the Treasury. “We’re going to put everything on the table — I think everything needs to be looked at,” Salazar said.

Meanwhile, Salazar said new legislation may be needed to overhaul the scandal-plagued Minerals Management Service, a bureau of Interior that manages the nation’s offshore oil and natural gas reserves.

Salazar said his top priority is to restore confidence in the agency, and in particular the MMS, which was rocked last fall by a report from the department’s inspector general that accused some MMS employees of accepting gifts from and having sex with oil and gas industry representatives whose activities they were supposed to regulate.

Although the Bush administration late last year announced disciplinary action ranging from warnings to termination of more than a half-dozen workers implicated in the report, Salazar said he is mulling “whether additional actions are required.”

Many environmental groups are looking to Salazar to reverse certain policy changes made in the final months of the Bush administration, including new regulations on commercial oil-shale development that the groups say lock in inappropriately low royalty rates for energy firms. Salazar said he and his aides intend to review “all those issues” and that “I expect that there will be changes.”

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MendoCoastCurrent, January 28, 2009
To Keep Momentum, AWEA Calls for Quick Approval of the Obama Stimulus Package

wind-energy1

Architect Laurie Chetwood's Wind Dam

The massive growth in 2008 swelled the nation’s total wind power generating capacity by 50% and channeled an investment of some $17 billion into the economy, positioning wind power as one of the leading sources of new power generation in the country today along with natural gas, AWEA added. However, at year’s end financing for new projects and orders for turbine components slowed to a trickle as layoffs began to hit the wind turbine manufacturing sector.

“Our numbers are both exciting and sobering,” said AWEA CEO Denise Bode. “The U.S. wind energy industry’s performance in 2008 confirms that wind is an economic and job creation dynamo, ready to deliver on the President’s call to double renewable energy production in three years. At the same time, it is clear that the economic and financial downturn have begun to take a serious toll on new wind development. We are already seeing layoffs in the area where wind’s promise is greatest for our economy: the wind power manufacturing sector. Quick action in the stimulus bill is vital to restore the industry’s momentum and create jobs as we help make our country more secure and leave a more stable climate for our children.”

The new wind projects completed in 2008 account for about 42% of the entire new power-producing capacity added nationally last year, according to initial estimates, and will avoid nearly 44 million tons of carbon emissions, the equivalent of taking over 7 million cars off of the road.

The amount that the industry brought online in the 4th quarter alone – 4,112 MW – exceeds annual additions for every year except 2007. In all, wind energy generating capacity in the U.S. now stands at 25,170 MW, producing enough electricity to power the equivalent of close to 7 million household. Iowa, with 2,790 MW installed, surpassed California (2,517 MW) in wind power generating capacity. The top five states in terms of capacity installed are now:

  • Texas, with 7,116 MW
  • Iowa, with 2,790 MW
  • California, with 2,517 MW
  • Minnesota, with 1,752 MW
  • Washington, with 1,375 MW

Oregon moved into the top tier states with more than 1,000 MW installed, which now include Texas, Iowa, California, Minnesota, Washington, Colorado and Oregon.

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SCOTT DUKE HARRIS and MATT NAUMAN, San Jose Mercury News, January 27, 2009

obama-hope2As President Barack Obama and Congress hammer out an economic stimulus package expected to be in the $825 billion range, Silicon Valley clean tech leaders are heartened by an energy agenda that starts with an emphasis on “smart grid” technologies that encourage energy conservation.That agenda will add jobs and bring dollars to several Silicon Valley companies, they say, especially those making smart grid components, solar panels, electric cars and green building materials.

It’s “a good start,” said venture capitalist Pascal Levensohn, whose portfolio includes clean tech investments. “There is a lot of optimism.”

Details of the new stimulus package are still being worked out, but talks suggest that about $60 billion will be applied toward promoting clean, efficient “energy independence” and creating jobs in the process.

Billions of dollars are expected to be applied to weatherizing government buildings, schools and homes. Billions more would go to loans and grants to promote renewable energy such as solar and wind. And still more billions would be spent upgrading the infrastructure of America’s power grids.

Bringing the power grid into the Internet age is a priority. The bill presented by House Democrats includes $11 billion to boost the IQ of electrical grids by employing sensors to maximize efficiency and minimize waste. An alternative bill introduced in the Senate would raise that sum to $16 billion.

“We’ve been swimming upstream,” said Peter Sharer, chief executive of Agilewaves, a Menlo Park maker of a product that monitors electricity, gas and water use in homes and businesses. “We’re finally swimming with the current. That’s what federal support means to us.” 

While initiatives like solar power have cosmic cachet, upgrading the power infrastructure is the logical place to start, some clean tech investors say. “We know that efficiency is the low-hanging fruit,” explained Levensohn, of Levensohn Venture Partners in San Francisco. 

America’s aging power grids now waste 10 to 30 percent of electricity from the generator to the plug, industry experts say. Foundation Capital partner Steve Vassallo likened the grid to a leaky bucket. Instead of simply putting more energy into the system, “the first thing you should do is fix the bucket,” he said.

The weaknesses in California’s energy grid and marketplace were starkly exposed in 2000 and 2001. Then, as Californians were hit by brownouts and ballooning electricity bills, President George W. Bush refused to support temporary price caps and blamed the energy crisis on environmental rules and a shortage of power plants. Only later was it discovered that energy dealers including Enron, a major supporter of Bush and adviser on Vice President Dick Cheney’s energy task force, were gaming California’s dysfunctional energy market, profiteering with schemes nicknamed “Death Star” and “Get Shorty.” Enron would later implode from its own culture of corruption.

The energy crisis inspired Silicon Valley entrepreneurs to seek solutions. Menlo Park’s Foundation started investing in clean tech in 2002, including smart grid companies Silver Spring Networks, based in Redwood City; eMeter, based in San Mateo; and EnerNOC, based in Boston.

The “smart grid” approach employs real-time monitoring and sensors to minimize waste and help identify parts of the grid that are leaking energy and need repairs. In an age of Internet connectivity, utilities typically remain unaware of outages until consumers call with problems, Vassallo said, and still rely on human meter readers walking door-to-door to check energy use “30 days in arrears.”

Pacific Gas & Electric plans to spend more than $2 billion to install 10.3 million smart electric and gas meters. Installations started in Bakersfield in late 2006, and are scheduled to reach the Bay Area by the end of this year.

This digital, wireless device will allow PG&E to get quicker notification of power outages, and also allow it to cut or reduce power during periods of high demand, if a customer agrees. Eventually, PG&E says, smart meters will allow it to better tap into energy that is put into the grid from solar panels installed on homes and businesses.

While California’s grid is “getting smarter,” Vassallo said, most states are served by power grids without the benefit of any information technology and, unlike California, have pricing structures that do not encourage conservation.

Valley companies are keenly scrutinizing the potentially devilish details. SunPower, the San Jose maker of solar modules, is pleased with the “wide, broad, deep effort” to promote cleaner energy as part of the stimulus, said Julie Blunden, a vice president. But she doesn’t think the effort will generate jobs until the second half of 2009.

SunPower, Blunden said, is ready to ramp up work in areas where it has expertise, such as putting solar systems on government buildings, as well as “beefing up areas where we don’t have strong, established channels.”

Weatherizing buildings and promoting new “green” development might benefit companies such as Serious Materials, a Sunnyvale maker of energy-saving building materials, such as heavily insulated windows and greener drywall.

Kevin Surace, the company’s chief executive, sees a lucrative market — 1 million to 2 million homes a year plus tens of thousands of government buildings. His company just bought two window factories, and Surace expects to grow his head count from 150 to 250 or 300 by year’s end.

Project Frog, a San Francisco company that builds green school buildings, is also encouraged. “We’re ready to help schools make use of these funds,” said Adam Tibbs, the company’s president.

Government support may help stimulate more private-sector investments in energy, says Agilewaves’ Sharer and other clean tech executives. But Lyndon Rive, chief executive of Solar City, which was expanding rapidly until the credit crunch hit, said the most important thing for clean tech is for financing to flow again.

“We want to get banks back into buying solar, wind and other renewable” energy assets, Rive said.

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CASSANDRA PROFITA, The Daily Astorian, January 26, 2009

In a move eagerly anticipated by liquefied natural gas opponents on the North Coast of Oregon, President Barack Obama has named Jon Wellinghoff acting chairman of the Federal Energy Regulatory Commission.

“The move, together with likely changes to the board’s makeup in the coming months and pending challenges to the U.S. Court of Appeals, could have consequences for the Bradwood Landing LNG project, the front-runner among three LNG proposals in Oregon.

Wellinghoff, a Democrat, was the lone dissenting vote on the Bradwood project, which was approved by FERC in a 4-1 vote in September. He replaces former chairman Joseph Kelliher, a Republican, who stepped down earlier this month but remains on the board as he looks for new job opportunities.

Wellinghoff helped establish FERC’s Energy Innovations Sector to promote new technologies and was also the main author of the renewable energy standards established in Nevada, where he served as the state’s first consumer advocate for customers of public utilities. Environmentalists expect the commission to put a higher priority on energy efficiency and renewable resources under his leadership.

“The new chairman is technically only one vote, but he does help set the agenda for the discussions and considerations of FERC,” said Peter Huhtala, executive director of the Astoria-based Columbia River Business Alliance, which is opposed to LNG. “It’s a step in the right direction, certainly.”

Wellinghoff traveled to Oregon in 2007 to talk with local and state leaders about the three LNG projects proposed in Oregon. Two proposed terminals are on the lower Columbia River and one is in Coos Bay.

“He listened to our concerns,” said Huhtala. “I felt like we were listened to, and – son of a gun – he followed up.”

Wellinghoff voted against the $650 million Bradwood Landing project, proposed for a site 20 miles east of Astoria on the Columbia River, arguing that the project developers have not proven the LNG terminal is needed to meet the region’s energy needs, that more efficient, reliable and environmentally preferable alternatives could substitute for LNG, and that “significant environmental concerns” about the project had not been fully evaluated.

Several challenges to FERC’s approval of the Bradwood project are still in the works, and two FERC board members, Kelliher and Commissioner Suedeen Kelly, whose term ends June 30 are likely to be replaced by Obama appointees in the next six months.

“It starts to get real easy to count to three, doesn’t it?” said Huhtala.

Brett VandenHeuvel, executive director of the LNG opponent group Columbia Riverkeeper, said by the time the Bradwood project developers have met more than 100 conditions placed on the September approval, the board may have a different opinion of what meets federal regulations.

“Bradwood is far from meeting its conditions and far from getting its approval to start construction,” he said. “FERC’s approval says there can’t be any construction, any action, until they get final approval from FERC after satisfying all the conditions. We expect FERC to look at Bradwood with a more critical eye when determining the conditions.”

Columbia Riverkeeper and Gov. Ted Kulongoski are both planning to file a challenge to FERC’s approval of the Bradwood project at the U.S. Court of Appeals this week. The state of Washington and regional tribes may file similar challenges, as well.

If the court overturns the Bradwood approval, FERC will have to revisit the case and may even be forced to redo the environmental assessment of the project.

“With a new chair, new FERC members and a decision from the court rejecting FERC’s initial approval, we may very well get a different answer,” said VandenHeuvel.

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PRESTON GRALLA, GreenerComputing.com, January 22, 2009

In a briefing to the Obama transition team in December, IBM CEO Samuel J. Palmisano recommended that Obama require that all federal data centers go green in three years.

According to the Wall Street Journal, Obama advisers had asked IBM shortly after the election to give a briefing about what impact investing in IT could have on job creation. In response, Palmisano made his presentation in a conference call. 

Most of the call was devoted to how an investment in technology could create jobs. IBM had worked with the think tank the Information Technology and Innovation Foundation to look at three areas: broadband, IT related to health care, and smart grid technologies to make electric power more efficient. 

IBM told the Obama tteam that spending $10 billion for broadband networks to give high-speed Internet access to locations that now don’t have it would create 498,000 jobs in a year. Investing $10 billion in health-related IT would create 212,000 jobs. And investing $10 billion in a smart grid would create 239,000 jobs. 

Doing all that, of course, takes legislation. But according to the Journal article, Palmisano was also asked what steps the Obama administration could take that didn’t require Congressional action. The article says:

Mr. Palmisano suggested an executive order mandating that the government convert all its data center to be “green” data centers, optimized for energy efficiency, within three years.

Here’s hoping that Obama follows the advice. Not only would it directly help the environment and save the federal government money, but it would spur private enterprise to follow suit as well.

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JANE KAY, San Francisco Chronicle, January 17, 2009

ba-drilling0117__sfcg1232159552_part1The U.S. Interior Department, acting in President Bush’s final days in office, proposed on Friday opening up 130 million acres off of California’s coast to drilling for oil and natural gas, including areas off Humboldt and Mendocino counties and from San Luis Obispo south to San Diego.

After a hands-off policy for a quarter-century, the administration submitted plans to sell oil and gas leases for most of the U.S. coast, from the Gulf of Maine to Chesapeake Bay and the Outer Banks of North Carolina to the Gulf of Mexico and the Pacific Coast.

New drilling also was proposed in Alaska’s Bristol Bay, one of the nation’s most plentiful sources of fish, and the Arctic Ocean.

Washington, Oregon and protected parts of Florida were excluded along with waters off San Francisco Bay that lie within national marine sanctuaries.

On Friday, the American Petroleum Institute, the U.S. Chamber of Commerce and other business groups greeted the news with praise, saying it is time for domestic energy supplies to be released from the moratorium.

But environmental groups and some Democratic leaders who oppose California drilling criticized the 11th-hour move, vowing to work with the Obama administration to promote energy independence based on clean, renewable technologies.

“President Bush’s last-ditch effort to open our coasts to new drilling is nothing more than a parting gift to his buddies in the oil and gas industry,” said Lois Capps, D-Santa Barbara, a member of the House Natural Resources Committee.

On the eve of the 40th anniversary of the platform blowout that spilled 3 million gallons of black crude oil on 35 miles of beaches around Santa Barbara, Capps said, “New offshore drilling would not lower gas prices, make us more energy independent or get our economy back on track.”

Richard Charter, a longtime environmental lobbyist who now works for the Defenders of Wildlife Action Fund, called the government’s move “an extremist act.”

“What we see today is the political equivalent of a rock star trashing the hotel room right before checkout,” he said.

The Interior Department used a lapse in the congressional moratorium in October and a cancellation of a presidential prohibition in July to set in motion the lease-sale program – which the incoming administration of President-elect Barack Obama could cancel or proceed with.

Obama has said he would consider some offshore oil drilling as part of a comprehensive energy plan. Sen. Ken Salazar, D-Colo., Obama’s pick for interior secretary, hasn’t given his views on offshore drilling in California. He said in his confirmation hearings Thursday that he will confer with the administration’s team.

Gov. Arnold Schwarzenegger, along with the governors of Oregon and Washington, opposes new offshore oil drilling despite the new revenue it would offer the cash-strapped state.

The federal government has failed to make a case for a new program because energy resources are insignificant in the Atlantic, Pacific and eastern Gulf of Mexico, already-sold leases aren’t being used, and no protections are in place to protect the environment, the governors said.

In Friday’s announcement, Interior Department officials proposed three new lease sales, one in Northern California and two in Southern California in “areas with known hydrocarbon potential.” The proposals, which were based on requests from seven oil companies that weren’t named, would include:

— As many as 44 million acres of federal waters, which start 3 miles from the shoreline, off Humboldt and Mendocino counties.

— As many as 89 million acres off of San Luis Obispo, Santa Barbara, Ventura, Los Angeles, Riverside and San Diego counties. One lease would require equipment operating at a diagonal to drill within the Santa Barbara Ecological Preserve. In Southern California, there are 79 existing leases with 43 producing and 36 undeveloped.

There will be a 60-day comment period, with hearings in Ukiah, Fort Bragg, Santa Barbara, Ventura and San Diego. Dates for the hearings have not been announced.

If sales are allowed, they could occur as soon as 2014.

About 60%  of California citizens who commented on new oil-and-gas development were opposed to new drilling, according to the Interior Department’s oil-drilling agency, the Minerals Management Service.

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MendoCoastCurrent, January 17, 2009

Here’s the post from MendoCoastCurrent in the Citizen’s Briefing Book at President-elect Barack Obama’s change.gov site:

Renewable Energy Development (RED) federal task force

Immediately establish and staff a Renewable Energy Development (RED) federal task force chartered with exploring and fast-tracking the development, exploration and commercialization of environmentally-sensitive renewable energy solutions in solar, wind, wave, green-ag, et al.

At this ‘world-class incubator,’ federal energy policy development is created as cutting-edge technologies and science move swiftly from white boards and white papers to testing to refinement and implementation.

∞∞∞∞∞∞∞∞∞∞∞∞∞∞∞

If you wish to support this, please vote up this post at :

Renewable Energy Development (RED) federal task force.

∞∞∞∞∞∞∞∞∞∞∞∞∞∞∞

Mendocino Energy:

Renewable energy incubator and campus on the Mendocino coast exploring nascent and organic technology solutions in wind, wave, solar, green-ag, bioremediation and coastal energy, located on the 400+ acre waterfront G-P Mill site.

Mendocino Energy may be a Campus in Obama’s Renewable Energy Development (RED) federal task force.

Vision:

Mendocino Energy is located on the Mendocino coast, three plus hours north of San Francisco/Silicon Valley.  On the waterfront of Fort Bragg, a portion of the now-defunct Georgia-Pacific Mill Site shall be used for exploring best practices, cost-efficient, environmentally-sensitive renewable and sustainable energy development – wind, wave, solar, bioremediation, green-ag, among many others. The end goal is to identify and engineer optimum, commercial-scale, sustainable, renewable energy solutions.

Start-ups, universities (e.g., Stanford’s newly-funded energy institute), the federal government (RED) and the world’s greatest minds working together to create, collaborate, compete and participate in this fast-tracked exploration.

The campus is quickly constructed of green, temp-portable structures (also a green technology) on the healthiest areas of the Mill Site as in the past, this waterfront, 400+ acre created contaminated areas where mushroom bioremediation is currently being tested (one more sustainable technology requiring exploration). So, readying the site and determining best sites for solar thermal, wind turbines and mills, wave energy, etc.

To learn more about these technologies, especially wave energy, RSS MendoCoastCurrent.

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MendoCoastCurrent, January 17, 2009

Today at the Citizen’s Briefing Book at President-elect Barack Obama’s change.gov site, I shared this:

Renewable Energy Development (RED) federal task force

Immediately establish and staff a Renewable Energy Development (RED) federal task force chartered with exploring and fast-tracking the development, exploration and commercialization of environmentally-sensitive renewable energy solutions in solar, wind, wave, green-ag, et al.

In this world-class ‘incubator’ federal energy policy development is created as cutting-edge technologies and science move swiftly from white boards and white papers to testing to refinement and implementation.

∞∞∞∞∞∞∞∞∞∞∞∞∞∞∞

If you wish to support this, please vote up this post at :

Renewable Energy Development (RED) federal task force.

Thank you so much!

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JIM TANKERSLEY, LA Times, January 13, 2009

Senators celebrated Steven Chu today as a scientist, administrator and Nobel Prize winner. But in the hearing on his nomination as President-elect Barack Obama’s Energy secretary, Chu was cast in a new role: politician.

Under gentle questioning from the Senate Energy and Natural Resources Committee, the physicist and director of the Lawrence Berkeley National Laboratory signaled his support for a variety of energy alternatives — including coal — to America’s dependence on imported oil.

Chu told Republicans that he would help fast-track a resurgence of domestic nuclear power and accept oil and gas drilling as part of a broad energy package. He told Democrats that he would champion solar plants and a “smart grid” that could help bring more wind power to market.

He told coal-state senators that he supports increased research for so-called “clean coal” technology to capture and store carbon dioxide emissions, but that he wouldn’t wait for that process to be perfected before he supported new coal power plants. He softened a much-publicized 2008 comment that coal is “my worst nightmare,” saying that “if the world continues to use coal in the way we’re using it today . . . that’s a pretty bad dream.”

“We need all of the solutions,” Chu said midway through a more than two-hour hearing. “We need to make them as clean as possible, as quickly as possible. All I can say is, we really need to do all these things.”

But Chu made clear that he favors some things above others. He focused heavily on global warming and the need to combat it through efficiency measures and renewable energy research.

His questioners focused largely on regional energy production concerns, and Chu worked hard to allay them. He did not oppose calls for increased oil drilling as part of an energy package, but noted that the United States contains only an estimated 3% of the world’s known oil and gas reserves.

In multiple answers, he sketched a plan for accelerated nuclear energy development, including improving a department loan program for new reactors and developing a long-range plan for dealing with nuclear waste.

His most extended questioning on climate change came from Sen. Bob Corker (R-Tenn.), who asked whether Chu preferred setting government caps on emissions or levying a carbon tax to curb them. Chu deferred to Obama’s stance in favor of caps.

“Is that the best decision,” Corker asked, “or the politically best decision?”

To which Chu replied, drawing laughter: “You’re far more experienced at answering that question than I am.”

Committee members praised Chu’s credentials and his answers, and they predicted quick and easy confirmation of his appointment. Sen. Jeff Bingaman (D-N.M.), who chairs the energy committee, said the committee could approve Chu by week’s end.

The committee’s top Republican, Sen. Lisa Murkowski of Alaska, told Chu: “It’s probably fair to say that you are uniquely poised in your ability to bring with you your background that relates the science and the technology” of the Energy Department.

Chu’s home-state senators, Barbara Boxer and Dianne Feinstein of California, were equally effusive: “Simply stating, in my opinion,” Feinstein said, “there is no one brighter or more equipped than this man to become secretary of energy.”

After the hearing, even environmental groups that oppose coal and nuclear plants praised Chu’s commitment to renewable fuels and efficiency.

“What I am most heartened by is that we have someone heading the Department of Energy now who not only believes that we must fight global warming, but that the top ways of fighting global warming are energy efficiency and renewable energy,” said Anna Aurilio, who directs the Washington office for Environment America. “This is a huge change in direction from where the previous administration has been.”

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MendoCoastCurrent, January 8, 2009

obama-hope1Key President-elect Barack Obama renewable energy quotes from his January 8, 2009 speech to the U.S. Congress and citizens, on his top economic priorities as he takes office.

“. . .the first question that each of us asks isn’t ‘what’s good for me?’ but ‘what’s good for the country my children will inherit?”

On creating new jobs and investing in America’s future:

“This plan must begin today. A plan I’m confident will save and create at least three million jobs over the next few years.”

The American Recovery & Reinvestment Program:

“It’s not just a public works program. It’s a plan that recognizes both the paradox and promise of the moment. The fact that there are millions of Americans trying to find work, even as all around the country there’s so much work to be done and that’s why we’ll invest in priorities like energy and education, healthcare and a new infrastructure that are necessary to keep us strong and competitive in the 21st century. That’s why the overwhelming majority of the jobs created will be in the private sector while our plan will save public sector jobs . . .”

“To finally spark the creation of a clean energy economy, we will double the production of alternative energy in the next three years. We will modernize more than 75% of federal buildings and improve the energy efficiency of two million American homes, saving consumers and taxpayers billions on our energy bills.”

“In the process, we will put Americans to work in jobs that pay well and cannot be outsourced. Jobs building solar panels and wind turbines, constructing fuel efficient cars and buildings, and developing the new energy technologies that will lead to even more jobs, more savings and a cleaner, safer planet in the bargain.”

“The time has come to build a 21st century economy in which hard work and responsibility are once again rewarded.”

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MendoCoastCurrent, January 7, 2009

Federal Energy Regulatory Commission Chairman Joseph T. Kelliher today issued the following statement:

Today I announce my intention to step down as chairman of the Federal Energy Regulatory Commission (FERC), effective January 20, 2009. Although my term as commissioner does not end until 2012, I will also immediately begin to recuse myself from FERC business, as I explore other career opportunities.  

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DAVID EHRLICH, Earth2Tech/GigaOm, December 23, 2008

environmental_defenseOcean energy could have a big part to play under President-elect Barack Obama’s environmentally friendly administration, but a coalition that’s pushing for more wave and tidal power says change is needed to expand the number of projects in the U.S. Right now, there are only a handful of ocean energy projects in the U.S. and they’re all in the testing phase, according to the coalition.

The group, which is led by the New York-based Environmental Defense Fund, a non-profit environmental advocacy organization, said it has met with Obama’s transition team to discuss what it says is a confusing, and sometimes contradictory, array of federal regulations for ocean power. It claims that with federal help, ocean energy has the potential to generate 10% of the country’s demand for electricity, as well as create tens of thousands of jobs in the U.S.

Earlier this month, Obama named four key members to his cabinet that will be responsible for energy and climate change, including Steven Chu as energy secretary.

One big conflict the new cabinet may have to deal with is a jurisdictional dispute between the Federal Energy Regulatory Commission and the Minerals Management Service, part of the Dept. of the Interior. Both agencies have claims on the waters where ocean energy projects would be installed.

Part of the Energy Policy Act of 2005 gave the Minerals Management Service the power to issue leases for renewable energy projects in the outer continental shelf a zone of federally owned seabeds outside of state waters, which the coalition said typically covers an area from 3-200 nautical miles offshore.

But that new law didn’t eliminate any preexisting federal authority in the area, and the FERC has said it has the authority to license wave and tidal projects in U.S. territorial waters covering an area within 12 nautical miles of the shore.

According to the coalition, despite negotiations between the two agencies, they’ve been unable to reach an agreement on the overlapping claims. The group said that the continued uncertainty from that conflict is making it harder to lock down financing for ocean energy projects in the States.

The coalition is made up of local governments, utilities, environmental groups and ocean power companies, including Pennington, N.J.-based Ocean Power Technologies, which recently inked a deal to develop wave power projects off the coasts of Australia and New Zealand.

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JANE KAY, The San Francisco Chronicle, December 29, 2008

ba-drilling1229__sfcg1230351957The federal government is taking steps that may open California’s fabled coast to oil drilling in as few as three years, an action that could place dozens of platforms off the Sonoma, Mendocino and Humboldt coasts, and raises the specter of spills, air pollution and increased ship traffic into San Francisco Bay.

Millions of acres of oil deposits, mapped in the 1980s when then-Interior Secretary James Watt and Energy Secretary Donald Hodel pushed for California exploration, lie a few miles from the forested North Coast and near the mouth of the Russian River, as well as off Malibu, Santa Monica and La Jolla in Southern California.

“These are the targets,” said Richard Charter, a lobbyist for the Defenders of Wildlife Action Fund who worked for three decades to win congressional bans on offshore drilling. “You couldn’t design a better formula to create adverse impacts on California’s coastal-dependent economy.”

The bans that protected both of the nation’s coasts beginning in 1981, from California to the Pacific Northwest to the Atlantic Coast and the Straits of Florida, ended this year when Congress let the moratorium lapse.

President-elect Barack Obama hasn’t said whether he would overturn President Bush’s lifting last summer of the ban on drilling, as gas prices reached a historic high. Sen. Ken Salazar, D-Col., Obama’s pick as interior secretary and head of the nation’s ocean-drilling agency, hasn’t said what he would do in coastal waters.

The Interior Department has moved to open some or all federal waters, which begin 3 miles from shore and are outside state control, for exploration as early as 2010. Rigs could go up in 2012.

National marine sanctuaries off San Francisco and Monterey bays are off-limits in California. Areas open to drilling extend from Bodega Bay north to the Oregon border and from Morro Bay south to the U.S.-Mexico border.

Drilling foes say the impacts of explosive blasts from seismic air guns that map rock formations, increased vessel traffic and oil spills should be enough to persuade federal agencies to thwart petroleum exploration. California’s treasured coast, with its migrating whales, millions of seabirds, sea otters, fish and crab feeding grounds, beaches and tidal waters, are at risk, Charter and other opponents say.

According to the Interior Department, coastal areas nationwide that were affected by the drilling ban contain 18 billion barrels of oil and 76 trillion cubic feet of natural gas in what the agency called yet-to-be-discovered fields. The estimates are conservative and are based on seismic surveys in the late 1970s and early 1980s, before the moratorium went into effect.

California’s Share

The agency’s last estimate puts about 10 billion barrels in California, enough to supply the nation for 17 months. That breaks down to 2.1 billion barrels from Point Arena in Mendocino County to the Oregon border, 2.3 billion from Point Arena south to San Luis Obispo County and 5.6 billion between there and Mexico.

“If you were allowed to go out and do new exploration, those numbers could go up or down. In most cases, you would expect them to go up,” said Dave Smith, deputy communications officer of the Interior Department’s Minerals Management Service, which oversees energy development in federal waters.

In California, any exploration and drilling would be close to shore, experts say. In contrast to the Gulf of Mexico, where drilling could occur in waters 10,000 feet deep, California’s holdings lie on its narrow, shallow continental shelf, the underwater edge of land where creatures died over the millennia to produce the oil.

If the Interior Department decides to explore off California’s coast, it could probably do so, some attorneys say. If a state objects to a lease plan, the president has the final say.

Once an area has been leased, the California Coastal Commission may review an oil company’s plan to explore or extract resources to assess if it is consistent with the state’s coastal management program. Conflicts can end up in court, said Alison Dettmer, the commission’s deputy director.

Californians have generally opposed drilling since a platform blowout in 1969 splashed 3 million gallons of black, gooey crude oil on 35 miles of beaches around Santa Barbara, killing otters and seabirds. The destruction of shoreline and wildlife sparked activism and led to the creation of the Coastal Commission.

But when gas prices peaked a few months ago amid cries of “drill, baby, drill” at rallies for GOP presidential candidate John McCain and running mate Sarah Palin, 51 percent of Californians said they favored more offshore drilling, according to a survey by the Public Policy Institute of California.

In July, Interior Secretary Dirk Kempthorne jump-started the development of a new oil and natural gas leasing program and pushed up possible new coastal activity by two years.

The Interior Department is reviewing comments about which coastal areas to include in the next five-year leasing plan. Oil companies want all of the nation’s coastal areas open and say they can produce oil offshore in a way that protects the environment. Gov. Arnold Schwarzenegger, who opposes new offshore development, has offered comments, as have environmental groups.

Obama’s Energy Plans

Obama’s administration and Congress will have the final say over which regions, if any, would be put up for possible lease sales. In Congress earlier this year, Salazar, Obama’s nominee for interior secretary, supported a bipartisan bill allowing exploration and production 50 miles out from the southern Atlantic coast with state approval. The bill died.

“We’ve been encouraged that the president-elect has chosen Sen. Salazar,” said Dan Naatz, vice president for federal resources with the Independent Petroleum Association of America, a group with 5,000 members that drill 90% of the oil and natural gas wells in the United States. “He’s from the West, and he understands federal land policy, which is really key.”

During this year’s presidential campaign, Obama was bombarded by questions about high gas prices and said new domestic drilling wouldn’t do much to lower gasoline prices but could have a place in a comprehensive energy program.

After introducing his green team of environment and energy chiefs recently, Obama said the foundation of the nation’s energy independence lies in the “power of wind and solar, in new crops and new technologies, in the innovation of our scientists and entrepreneurs and the dedication and skill of our workforce.”

He spoke of moving “beyond our oil addiction,” creating “a new, hybrid economy” and investing in “renewable energy that will give life to new businesses and industries.”

Obama didn’t mention oil drilling. When a reporter asked him if he would reinstate the moratorium, he said he wasn’t happy that the moratorium was allowed to lapse in Congress without a broader thought to how the country was going to reduce dependence on fossil fuels.

He reiterated his campaign position that he was open to the idea of offshore drilling if it was part of a comprehensive package, adding that he would turn over the question to his team.

In the 1970s and 1980s, before the moratorium on offshore drilling fully took effect, the federal government produced a series of maps showing areas in California of prospective interest to the oil industry. Those maps offer clues to where oil companies would bid if they had the opportunity.

North Coast

The last proposed lease sale in 1987, thwarted by the moratorium, would have opened 6.5 million acres off the North Coast. Off Mendocino and Humboldt counties, the tracts for sale lay from 3 to 27 miles offshore, and some of the 24 planned platforms, some of them 300 feet tall and each with dozens of wells, would have been visible from land.

Tourism and commercial fisheries would have been affected, according to an environmental review then, while as many as 240 new oil tanker trips from Fort Bragg and Eureka to San Francisco Bay refineries were predicted under the full development scenario. The probability of one or more spills occurring would be 94 percent for accidents involving 1,000 barrels or more, according to documents.

Rep. Lois Capps, D-Santa Barbara, a member of the House Natural Resources Committee, recently said oil drilling will be part of a comprehensive energy policy focusing on renewable sources, but she would like to see drilling occur only on land and in the Gulf of Mexico where infrastructure is in place.

Capps well remembers the Santa Barbara spill almost 40 years ago.

“I was living in Goleta. I just had two children, and my husband was a young professor at UC Santa Barbara. It was a devastating experience,” she said. “The birds and other animals got trapped in the oil. So many people waded out in boots just inch by inch trying to rescue our wildlife. It ruined our tourism for many years.

“I think about it all the time, especially last week when we had had a spill at the same platform. It was a small spill, 1,000 gallons, but it was a wake-up call.”

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Excerpts from article by FRANK HARTZELL, The Mendocino Beacon, December 24, 2008

On January 13, 2009, from 5-7p.m. at Fort Bragg Town Hall, a “top official from the Federal Energy Regulatory Commission (FERC) will appear to explain the agency’s strategy on developing what it calls “hydrokinetic” power as an alterative energy source.

Ann F. Miles, FERC’s director of the Division of Hydropower Licensing, will meet with county and city officials before attending the public meeting in Fort Bragg.

“The FISH Committee is looking forward to FERC’s visit, and welcomes the opportunity to learn about the different FERC licensing processes for wave energy, and how fishermen and other affected people can participate and have their voices heard,” said attorney Elizabeth Mitchell, who represents the Fisherman Involved for Safe Hydrokinetics.

Ocean waters off the Mendocino Coast, from Little River to Cleone, are now claimed under exclusive study permits by two different wave energy developers. GreenWave LLC claims 17 square miles of waters from Little River to Point Cabrillo, while PG&E claims 68 square miles from Point Cabrillo to Cleone.

Preliminary permits granted by FERC give not only exclusive study rights to the claimants, but also licensing priority to develop wave energy upon successful completion of the three-year studies.

Fort Bragg has become ground-zero for wave energy regulation. The federal Minerals Management Service, which is involved in an open feud with FERC over wave energy regulation, has sought to make Fort Bragg its test case.

FERC drew local ire by denying local efforts to intervene in the study process. At one point, protesters carried signs targeting the obscure federal agency with messages such as “Don’t FERC with us.”

One FERC insider said commissioners had complained that more fuss had been made in tiny Fort Bragg than the entire rest of the nation.

FERC later relented and on appeal granted intervener status to Mendocino County, for the PG&E project. The period to intervene and comment on GreenWave’s permit closes Friday, Feb. 6. As yet, nobody has filed anything with FERC, according to its Website.

“The commission’s existing procedures are well-established and well-suited to address this expansion of conventional hydropower with new technologies,” Miles told Congress last year, “and we are prepared to learn from experience in this rapidly evolving area and to make whatever regulatory adjustments are appropriate in order to help realize the potential of this renewable energy resource.”

FERC expanded its domain into all tidal, wave, river flow and ocean current study and licensing with its novel concept of a unified “hydrokinetic” regulation.

From the Yukon River in Alaska to the ocean currents off the Florida Keys, FERC has grown its regulatory territory dramatically since the start of the Bush administration. The agency is now explaining how dam regulation and wave energy innovation can go together. FERC recently granted the first hydrokinetic plant permit for production of energy in the Mississippi River in the state of Minnesota.

The independent agency has moved quickly with Neo-Con era disdain for regulation, eschewing calls from fellow federal and state agencies for a conventional rulemaking process. Instead FERC has adjusted its process as it goes along.

In her presentation to Congress, Miles focused on wave energy, not the more prevalent river current energy plans. She said wave energy projects will likely occur close to shore, not far out in federal waters.

“The cumulative costs of development … make it advantageous to locate projects nearer to the shore,” Miles told Congress.

Locals have complained that FERC has no intelligible process for public input. Governments and critics of FERC have been frustrated in efforts to get details.

FERC is a uniquely independent federal agency. It is under the Department of Energy but does not report to DOE, a structure that was created during the Great Depression. The president appoints FERC commissioners.

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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.

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CYNTHIA THIELEN, The Star Bulletin, December 21, 2008

Rep. Cynthia Thielen represents the 50th District (Kailua-Kaneohe Bay) in the State House

coh1An unusual consortium comprised of large utilities, environmental groups, energy think tanks and ocean energy developers has just written to President-elect Barack Obama about the tremendous potential of wave energy and the role it can play in reducing our nation’s dependence upon oil.

The group includes utilities such as Pacific Gas & Electric, Portland General Electric and Florida Power & Light (the largest utilities in California, Oregon and Florida, respectively); environmental groups such as the Environmental Defense Fund, Surfrider Foundation and Natural Resources Defense Council; and academic entities Oregon State University and the New England Marine Renewable Energy Center. Taking the initiative on Hawaii’s behalf are Robbie Alm, COO of Hawaiian Electric Co., Virginia Hinshaw, chancellor of the University of Hawaii, and Ted Liu, director of the state Department of Business, Economic Development & Tourism. I encouraged these Hawaii leaders to participate in the important discussions with the new administration.

In its letter to the president-elect, the consortium is asking Obama to provide support for wave energy, citing “conservative estimates” that indicate wave energy could “supply at least 10% of the current U.S. demand.” That’s a staggering number for an economically imperiled nation that has spent $700 billion in the last two years on imported oil.

The consortium attached a white paper, titled “Ocean Renewable Energy: A Shared Vision and Call for Action,” to its letter. Among the guiding principles are encouraging pilot and demonstration scale projects, streamlining regulatory processes and cooperating in preparation of unified environmental documents.

Economic stimulation can’t take place at home if the U.S. ends up having to import wave energy conversion technology. The consortium stakeholders are making this a major focal point, stating that “without increased government action to encourage demonstration projects and to fund research and development, the promise of ocean renewable energy may never be realized, and the U.S. may see Europe corner the market on these technologies, in much the same way that it did with wind.”

The consortium also stresses the importance of pilot projects in determining the effects of wave energy technology on marine environments to ensure that we protect our ocean resources to the greatest degree possible while extracting energy from ocean waves.

I joined the stakeholders in the consortium and met with Obama’s transition team on December 16, 2008 in Washington, D.C., to discuss how best to integrate wave energy technology into the U.S. energy portfolio.

Hawaii is poised to become a leader. The Department of Energy designated the University of Hawaii as one of two national Marine Renewable Energy Centers. HECO, the administration and energy department signed a Memorandum of Understanding creating the Hawaii Clean Energy Initiative, an effort to meet 70% of Hawaii’s energy needs with clean energy by the year 2030. Since that time, Hawaii has seen bold plans in the renewable sector. Two of the more ambitious projects are Oceanlinx LLC’s wave energy project off Maui, and Better Place’s electric vehicles. But the electric vehicles must be able to obtain energy from clean, renewable resources, such as ocean waves.

The message I gave to Obama’s transition team is that Hawaii is one of the best places in the world for wave energy conversion, and we are ready. We have an abundance of year-round wave energy, a large, concentrated market on Oahu and our residents pay the highest electricity rates in the nation because our state exports up to $7 billion each year to import oil. With UH Chancellor Hinshaw, HECO executive Alm and economic director Liu joining the consortium’s call for action, our state will lead.

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MARGOT ROOSEVELT, The Los Angeles Times, December 12, 2008

california_mapCalifornia regulators adopted the nation’s first comprehensive plan to slash greenhouse gases on December 11th and characterized it as a model for President-elect Barack Obama, who has pledged an aggressive national and international effort to combat global warming.

The ambitious blueprint by the world’s eighth-largest economy would cut the state’s emissions by 15% from today’s level over the next 12 years, bringing them down to 1990 levels.

Approved by the state’s Air Resources Board in a unanimous vote, the 134 page plan lays out targets for virtually every sector of the economy, including automobiles, refineries, buildings and landfills. It would require a third of California’s electricity to come from solar energy, wind farms and other renewable sources — far more than any state currently requires.

Gov. Arnold Schwarzenegger, who has been a vigorous advocate of the plan, vowed that it would “unleash the full force of California’s innovation and technology for a healthier planet.”

Businesses, however, are sharply divided.

Automakers oppose California’s pending crackdown on carbon dioxide emissions from cars, a regulation that more than a dozen states have pledged to adopt. Manufacturers want regulators to lower the cost of complying, saying it will lead to billions of dollars in higher electricity costs.

“This plan is an economic train wreck waiting to happen,” James Duran of the California Hispanic Chambers of Commerce told the board, saying that it would cause financial hardship to minority-owned companies.

But Bob Epstein, a Silicon Valley entrepreneur, led a coalition of energy, technology and Hollywood executives, including Google Chief Executive Eric Schmidt, in endorsing the plan as a spur to the state’s lagging economy.

Investors have poured $2.5 billion into California cleantech companies in the first nine months of the year, up from $1.8 billion for all of 2007, he said, a level that eclipsed the software industry.

“This plan is a clear signal to investors to invest in California,” Epstein said.

Schwarzenegger, a sharp critic of President Bush’s opposition to climate legislation, said, “When you look at today’s depressed economy, green tech is one of the few bright spots out there.”

California’s plan will be “a road map for the rest of the nation,” he predicted.

After an aborted attempt last spring, Congress is expected to renew its efforts to craft climate legislation next year. Many of the elements in contention are addressed in California’s blueprint, including a cap and trade program that would allow industries to reduce emissions more cheaply.

In 18 months of public hearings and workshops, hundreds of people testified and more than 43,000 comments were submitted. More than 250,000 copies of the plan have been viewed or downloaded from the air board’s website in the last two months.

The state’s blueprint will be implemented over the next two years through industry specific regulations. Republican legislators have called on Schwarzenegger to delay the plan, citing the dire state of California’s economy and criticism of the air board’s economic models.

Fears were also expressed by city and county officials who said the plan’s effort to force land use changes infringes on local powers. Environmentalists want more ambitious strategies to curb the sprawl that has led to a rapid increase in driving, and thus in greenhouse gases.

Worldwide, emissions of planet warming gases, which are mainly formed by burning fossil fuels, have been growing far more rapidly than scientists had predicted. California is expected to experience severe damage from climate change by mid-century, including water shortages from a shrinking snowpack, increased wildfires, rising ocean levels and pollution aggravating heat waves.

Given the state’s fast growing population and sprawling suburban development, its emissions are on track to increase by 30% over 1990 levels by 2020. The new blueprint would slash the state’s carbon footprint over the next 12 years by a total of 174 million metric tons of greenhouse gas emissions — the equivalent of 4 metric tons for every resident.

Despite the reach of the state’s effort, it would barely make a dent in global warming: The state’s emissions account for about 1.5% of the world’s emissions. Nonetheless, air board Chairwoman Mary Nichols said California’s leadership has spurred other states to move ahead. “We are filling a vacuum left by inaction at the federal level,” she said.

More than two dozen states have committed to capping emissions since California passed its landmark 2006 global warming law, the trigger for this action by the Air Resources Board.

California has joined with four Canadian provinces and seven western states to form a regional cap and trade program. Under the program, the states would set a total allowable amount of emissions — as California did in its blueprint. Utilities and other large industries would be required to obtain allowances to cover their emissions. If companies cut emissions more than required, they can sell their extra emission reductions to firms that are not able to meet their targets.

A cap and trade system has been adopted in Europe, where it was initially fraught with logistical problems and afforded windfall profits to many industries. California’s system, which would apply to industries responsible for 85% of its emissions, is the most controversial aspect of its plan.

Groups representing low income residents of polluted urban areas testified that allowing industries to trade in emissions would lead to dirtier plants in their neighborhoods. Under California’s plan, industries would also be allowed to buy “offsets” — emission reductions from projects in other states, or possibly foreign nations, to avoid making their own reductions.

However, the board assuaged many environmentalists Thursday when it pledged that it would gradually move toward a system to auction 100% of greenhouse gas permits, rather than give the permits away for free, as was initially the case in Europe.

Bernadette del Chiaro, an energy analyst for Environment California, predicted the auctions could bring in $1 billion at the outset and up to $340 million per year by 2020.

“This is huge,” she said. “Revenue from polluters would be used to transit to a green economy.”

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ELIZABETH ROSENTHAL, The New York Times, December 11, 2008

Poznan, Polan — Senator John Kerry arrived at the United Nations climate conference here on Thursday and immediately reassured delegates that the United States would take strong measures to combat climate change.

“President Obama will be like night and day compared to President Bush,” Mr. Kerry, Democrat of Massachusetts, said at a news conference, adding, “Congress and the president-elect are committed to movement on mandatory goals as rapidly as possible.”

Although the incoming president has no official representatives here, the conference center is crawling with Congressional representatives and their staff members, a sign of the political transition in the United States.

Over the past two weeks, there have been staff members from more than 50 Congressional offices, representing figures like House Speaker Nancy Pelosi, Senator Richard G. Lugar of Indiana, a Republican foreign policy statesman and Representative Henry A. Waxman of California, who will be the new chairman of the House Energy and Commerce Committee.

On Wednesday, transition team officials for Mr. Obama said he would announce his top environment team next week, which so far includes Carol M. Browner, Steven Chu and Lisa P. Jackson.

Despite elation at the new United States presence, there was widespread concern among delegates that developed nations would be less willing to make the financial investments in climate change at a time of global recession. In opening the two-day meeting of environment ministers on Thursday morning, the United Nations secretary general, Ban Ki-moon, said there should be “no backsliding on our commitments.”

In a roundtable on Thursday, dozens of environment ministers pledged to hold to previous plans for emissions reductions. Stavros Dimas, environment director general of the European Union said, “We are determined despite economic surprises to deal with climate change.” The European Union has committed to reducing emissions 20% by 2020.

Still, other ministers made it clear that the global recession had made good works harder. “If we can bring our finance ministers back on board, we will be successful in Copenhagen,” where countries hope to arrive at a climate treaty by December 2009, said Sigmar Gabriel, Germany’s environment minister, who reiterated his country’s goal of cutting emissions by 25% to 30% over 1990 levels by 2020.

There were some bright spots at the conference, which is part of a negotiation to create the global climate treaty. Mexico took the lead among developing countries and committed itself to emission reduction targets and caps, even though developing countries are not required to do so under the Kyoto Protocol. Brazil said it would aim to cut deforestation 70% in the next decade.

But Xie Zhenhua, the head of the Chinese delegation, reiterated that as a developing country China should not have to make such numerical commitments, but that it would “take positive and effective mitigation and adaptation measures.” China is the world’s largest emitter.

Also, some developing countries said promises by industrial nations to help them cope with climate change seemed to have been put off. The fate of a fund to help poor countries adapt to climate change was unclear on Thursday.

“We are really disappointed with the progress we are seeing in Poznan,” said Amjad Abdulla, director general of the Ministry of Environment in the Maldives, a chain of low-lying islands that is threatened by rising sea levels. “We are drowning, and there is this huge gap in commitment.”

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DEBORAH CHARLES, Reuters, December 10, 2008

President-elect Barack Obama’s team to address climate change emerged on Wednesday as Democratic officials said he had chosen a Nobel laureate for U.S. energy secretary and was likely to pick an environmental veteran to serve as coordinator of climate policies.

Announcements to come in the days ahead include several key environment-related appointments — Steven Chu as energy secretary, Carol Browner as energy and climate coordinator, Nancy Sutley to head the White House Council on Environmental Quality and Lisa Jackson to run the Environmental Protection Agency.

They will be charged with developing policies to reduce carbon emissions blamed for global warming, develop new sources of energy and create new jobs — a top priority for Obama.

Chu is director of the Lawrence Berkeley National Laboratory and shared the 1997 Nobel Prize in physics. He was an early advocate for scientific solutions to climate change.

Browner was administrator of the Environmental Protection Agency during the Clinton administration. A principal at global strategy firm The Albright Group LLC, she heads Obama’s advisory team on energy and the environment.

Sutley has a long history in the environmental community. She is currently deputy mayor for energy and environment for Los Angeles and served on the California State Water Resources Control Board earlier this decade.

Jackson has served as commissioner of the Department of Environmental Protection in New Jersey.

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LORRAINE WOELLERT, Bloomberg, December 2, 2008

President-elect Barack Obama is considering a stimulus package that will include a heavy dose of spending on environmentally friendly projects aimed at creating “green-collar jobs” and saving energy.

While the package will focus on short-term outlays for traditional infrastructure projects to jumpstart an economy now officially declared to be in recession, it will also include longer-term measures to safeguard the environment.

“Clean energy is going to be a foundation for rebuilding the American economy,” said Bracken Hendricks, an analyst at the Democratic-leaning Center for American Progress and an adviser to the presidential-transition team. Generating jobs in concert with cutting pollution will be “a major component” of any economic-recovery plan, Hendricks said.

Obama wants to enact a recovery plan soon after his inauguration. Senate Majority Leader Harry Reid told reporters today that any proposal would have to be “robust” and include at least $400 billion in spending, though he wouldn’t rule out a bigger package. Senators Dick Durbin of Illinois, Obama’s closest Senate ally, and Charles Schumer of New York argue that an infusion of as much as $700 billion is warranted.

Reid said a green jobs component could be worth as much as $100 billion. He has endorsed investment in improved electricity transmission infrastructure and other ideas being put forth by Obama advisers.

‘Green Path’ Infrastructure

Obama adviser Jared Bernstein and other economists say that money would help fund environmentally sound infrastructure projects that could be up and running within a few months. Among the steps along the “green path,” Bernstein said, might be a requirement that repairs made to public buildings be environmentally friendly.

“Almost any major infrastructure project is going to be done in the greenest way possible,” said Alice Rivlin, a former vice chairman of the Federal Reserve who has spoken with members of the transition team about the package. “There will be spending for quick-starting infrastructure as well as for larger, better-thought-out programs over several years.”

A critical mass of support for clean-energy spending and green-collar-job creation is building among environmentalists, labor groups, local governments and companies such as Google Inc. and American Electric Power Co., the biggest U.S. producer of electricity from coal.

Creating Jobs

The loosely knit coalition is advocating for what Hendricks calls a “green recovery” stimulus that would create jobs with an eye toward conserving resources and reducing reliance on fossil fuels such as coal and oil.

School repairs, for example, could be required to meet green building standards, including low-energy boilers and weatherization. Transportation spending could emphasize public transit, and support for new power sources such as wind and energy could go hand in hand with spending on an efficient electricity superhighway.

Ideas include $2 billion in spending on public transit to reduce fares and expand service, $5 billion in renewable-energy bonds for consumer-owned utilities, $2.5 billion to buy and scrap old polluting cars, and $900 million to help weatherize one million homes.

‘Smart Grid’

Google is among the companies lobbying for long-term tax rebates for renewable energy as well as federal investment in electric “smart grid” technology that promises to lower energy use by creating two-way communication between energy providers and consumers.

Both provisions would create high-technology jobs, said Harry Wingo, energy policy counsel for Google, which has been meeting with Obama advisers and Capitol Hill lawmakers.

Green-jobs provisions “are going to lead to more job creation here and put us in a better spot to compete for the global market in clean energy,” Wingo said.

Other ideas include regulatory changes that could lead to less energy use and electricity-infrastructure improvements, said Susan Tomasky, president of AEP Transmission in Toledo.

The idea is to build new and better transmission lines to link the sunniest and windiest regions to the national grid.

AEP is among companies pushing for stimulus language that would make it easier to finance and site electricity infrastructure. It also wants Obama to formalize his campaign’s embrace of “an interstate highway system for transmission.”

Delivery Systems

“Obama gets that you can’t just build windmills and wish for the power to get where it needs to go,” Tomasky said. “It is all about infrastructure.”

Some groups are sounding a cautionary note. The U.S. Chamber of Commerce’s Institute for 21st Century Energy embraced the notion of creating jobs in renewable energy industries while warning against government overreaching.

“Whenever government tries to pick winners and losers, whether through burdensome regulations, central planning, or open-ended subsidies, it fails and taxpayers and consumers pay the price,” the institute said in a Nov. 17 report.

The conservative Heritage Foundation has criticized the green-jobs concept as big-government spending that would do little to stimulate growth.

‘Crisis du Jour’

“The people who have wanted these green initiatives are wrapping them up in the crisis du jour, the stimulus,” said David Kreutzer, a senior policy analyst at Heritage in Washington. “You have to pull resources out of some other part of the economy for government to spend it on green jobs. You don’t get a net job increase.”

Nonetheless, businesses are lining up behind the idea. In addition to big power consumers such as Google and utilities such as AEP, venture capitalists such as Kleiner Perkins Caufield & Byers support the green jobs concept and are lobbying for green provisions to be included in the stimulus.

“There’s a clear majority who want to do this,” said Michael Eckhart, president of the American Council On Renewable Energy, a Washington-based group of business leaders, academics and venture capitalists.

Even the simplest ideas could save energy and create jobs, said Jason Saragian, a spokesman for Owens Corning Inc., a Toledo, Ohio-based maker of insulation as well as material used in wind turbine blades. The company is pushing for tax breaks to encourage retrofitting of older buildings.

‘Huge Opportunity’

“There are 80 million underinsulated homes in the United States,” Saragian said. Buildings emit 42% of the nation’s greenhouse gasses. Weatherization “is a huge opportunity” to cut energy use, Saragian said.

State and city leaders are also making a pitch. Pennsylvania Governor Edward Rendell, chairman of the National Governors Association, said a stimulus should consist of increased spending on programs such as unemployment compensation, federal aid to states, and infrastructure for renewable energy. “There are upwards of $136 billion worth of projects ready to go,” Rendell told reporters.

The U.S. Conference of Mayors has its own list of some $25 billion worth of infrastructure projects that could be completed in 2009.

“The challenge is to make a green stimulus actually green,” said Dan Becker, a consultant with the Safe Climate Campaign, a Washington-based clean-air advocacy group. “The more road building you have the blacker it gets.”

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GERRY NORLANDER, Pulp Network, November 25, 2008

President-elect Obama has named Dr. Susan Tierney and Rose McKinney-James to his transition team for the U.S. Department of Energy (DOE) and the Federal Energy Regulatory Commission (FERC), which is organizationally within DOE.

Both appointees, former state utility commissioners of Massachusetts and Nevada, respectively, have a record of supporting electricity industry deregulation, or, as it is euphemistically named, “restructuring.” 

Thirty five states did not restructure, no state has restructured since 2000, and several states halted plans to adopt it when they saw its results in states like California and New York. 

The “restructuring” model strips the power generation function away from state-regulated utilities under the premise that the generation function can be deregulated if it is structured to be competitive. An implicit assumption of restructuring, which we reject, is that if the market price of a utility service is “competitive” it will then necessarily satisfy the legal requirement of being “just and reasonable.”

This regulatory fad peaked in the last decade of the last century when it was lavishly promoted by Enron’s Ken Lay, embraced by some state regulators, accepted by both the Clinton and Bush administrations, and pushed by FERC. FERC’s regime now lacks consumer support and confidence. 

To bring about functionally deregulated wholesale electricity markets without statutory authorization, FERC administratively morphed the Federal Power Act system of filed rate regulation into one of unfiled, unreviewable, and unrefundable wholesale market rates. The FERC system is now built upon “organized” spot markets for wholesale electricity such as those run by the NYISO and other Regional Transmission Organizations (RTOs), where energy is sold by sellers with “market-based rates.”

The FERC system has its greatest impact in restructured states that allowed utilities to sell off power plants whose output had been priced based on the cost of production, requiring most electricity to be bought at wholesale “market-based rates” eventually passed through to retail customers.   

Mathematical game theory, economics lab simulations, and experience demonstrate that the wholesale electricity spot markets that are at the heart of restructuring can be gamed and manipulated to drive prices well above competitive levels beyond the capacity or will of FERC to correct.

Even for those who would conflate the notions of competitiveness and reasonableness, the generation function is increasingly dominated by fewer large companies as the industry consolidates, undercutting the notion that many sellers will someday make electricity a buyer’s market and preclude the need for rate regulation. 

According to Duke Power CEO James Rogers, in light of the recent financial market developments,

“I think within 18 months you’ll see either consolidation or acquisition of all of [the major independent power producers].”

“The case for consolidation in our industry is more compelling today than it’s been in my 20-year career as CEO because of what’s going on in capital markets, because of the economy we’re in and no growth….”

Although most consumer groups are disappointed by the results of restructuring, major utility holding companies formed as a result of restructuring and the repeal of PUHCA, investment banking institutions, energy producers and wholesale traders, deregulated retail sells and the energy derivatives industry still push hard for preservation and expansion of the restructuring model.

Proponents of deregulation such as EPSA and the NYISO occasionally announce reports or studies purporting to show advantages of deregulation. Typically, these reports and studies have loopy methodologies, fail to address how the ISO/RTO markets actually affect consumer prices, and fail to pass any reasonable test of academic rigor. Stated John Kwoka, Northeastern University, in his findings, there is no “reliable and convincing evidence that consumers are better off as a result of the restructuring of the U.S. electric power industry.”

The Obama FERC Transition Team

Dr. Susan Tierney
Dr. Tierney, a consultant with the Analysis Group, has also been mentioned in the trade press as a possible candidate for FERC Chairman. With Cornell degrees in regional planning, she has a long, extensive and varied background in energy issues, including work for the Department of Energy in the Clinton administration. Her biography indicates that in recent years a significant part of her consulting work has been on behalf of electric utilities and industry stakeholders in defense of electric industry deregulation or “restructuring.” 

Rose McKinney-James 
According to Obama’s Change.gov web site, another transition team member, apparently overseeing the FERC appointments, is Rose McKinney-James:  

Rose McKinney-James is the Managing Principal of Energy Works Consulting. Previously she served as the President and CEO of the Corporation for Solar Technology and Renewable Resources (CSTRR) and Chair of the Nevada Renewable Energy Task Force. Past positions also include Commissioner with the Nevada Public Service Commission, Director of the Nevada Department of Business and Industry, Chief of Staff for the City of Las Vegas and Project Manager for the Nevada Economic Development Corporation. McKinney-James serves on the Board of Directors of MGM-Mirage, Employers Insurance Group, Toyota Financial Savings Bank, the Energy Foundation, the American Council for an Energy Efficient Economy (ACEEE), and the Nature Conservancy. She is the Board Chair for Nevada Partners.

According to Politico,

Rose McKinney-James single-handedly will lead the review on Federal Regulation and Oversight of Energy. She has a strong background in renewable energy and is currently the managing principal of Energy Works Consulting. She previously served as president and CEO of the Corporation for Solar Technology and Renewable Resources.

James was formerly a Nevada utility regulator. After the Western states experienced the results of market manipulation, she, along with numerous former state utility commissioners from restructured states, signed onto a 2003 Declaration of Consumer Benefits from Wholesale Power Markets, a statement indicating support for the restructuring model.  Since then, however, James appears not to have been actively involved in the continued promotion of restructuring and she reportedly has a keen interest in renewable energy. 

Conclusion

We would certainly be more hopeful of change in the interests of consumers if the DOE/FERC transition team more reflected the judgment of most states not to restructure, and better realized the experience of consumers in the states that did. Nevertheless, it cannot be assumed that Obama transition team members will recommend candidates for key positions who would continue the relentless restructuring efforts of past administrations without reflection upon the results to date and without heeding consumer concerns. 

Perhaps it is a hopeful sign of change that the latest rumored candidate for a FERC position is John H. Norris,  Chairman of the Iowa Utilities Board. Iowa, a state that once considered but did not adopt restructuring.

Update, December 4, 2008

The Longview Washington Daily News, in a story about the controversial Bradwood LNG terminal project for the Columbia River, states:

Obama also could reshape FERC itself.

Terms of the four FERC commissioners who voted in favor of the Bradwood project will expire during Obama’s first term, starting in 2009, Tamara Young-Allen, a spokeswoman for the agency, said in an e-mail. The other three commissioners’ terms expire in 2010, 2011 and 2012. (Commissioners serve five-year terms.)

Obama can also appoint a new FERC chairman. That would shift the current chairman, Joseph Kelliher, into a regular commissioner seat. It’s unclear whether Kelliher would finish out his term, which lasts through 2012, if he is removed from the chairman’s position.

When asked about his plans, Young-Allen noted, Kelliher has said, “When I have something to announce, I will tell you.”

VandenHeuvel, of Riverkeeper, speculated that Obama will appoint Jon Wellinghoff as the new chairman. Wellinghoff is a Nevada Democrat who was the only FERC member to oppose the Bradwood terminal in the September vote.

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KEVIN FERGUSON, The Information Week, November 24, 2008

1739725132_460c52d56dWhere is President-elect Barack Obama headed with environmental protection and renewable energy? The answer lies not so much in the encouraging but ultimately self-serving video posted on the transition team’s Web site, but rather on links elsewhere on the page. In particular, look at the appointment of senior transition official Rose McKinney-James as FERC Review Team Lead.

Unless you live in California or Nevada, you may not be familiar with the Federal Energy Regulatory Commission.  FERC — a relatively tiny agency that requested only $273.4 million and 1,465 full-time employees in its FY 2009 budget — regulates the country’s natural gas industry, hydroelectric projects, oil pipelines, and wholesale rates for electricity. You may recall that public advocacy groups excoriated FERC for its role in the deregulation of the wholesale electricity market in California and subsequent power crisis in 2000 and 2001.

So, what’s the significance of this recent appointment? McKinney-James, managing principal of Energy Works Consulting, has been championing renewable energy for decades, as the president and CEO of the public Corporation for Solar Technology and Renewable Resources (CSTRR), chair of the Nevada Renewable Energy Task Force, commissioner with the Nevada Public Service Commission, and other pubic posts.

Her efforts also have included renewable energy advocacy in the private sector — and in some rather unexpected places. The most visible of those places is MGM Mirage’s  Protech CityCenter in Las Vegas. McKinney-James sits on the MGM board.

The $7 billion development was recently awarded a Leadership in Energy and Environmental Design (LEED) certification by the U.S. Green Building Council. Project CityCenter includes a 4,000-room hotel-casino, two 400-room boutique hotels, more than 500,000 square feet of retail space, and 2,900 residential units on 66 acres between the Bellagio and Monte Carlo.

Perhaps McKinney-James can accelerate what has been a slow accommodation of renewable energy sources into FERC’s mix.

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MendoCoastCurrent, November 17, 2008

Announcements and short biographies of Obama’s Team Leads that oversee renewable energy policy development and associated agencies.

Energy and Natural Resources Team Lead
David J. Hayes is a member of the Obama-Biden Transition Project’s Agency Review Working Group responsible for the energy and natural resources agencies. He is former Global Chair of the Environment, Land and Resources Department at Latham & Watkins, an international law firm. He is a Senior Fellow at the World Wildlife Fund, advising the President of WWF on climate change matters, and he is a Senior Fellow at the Progressive Policy Institute, specializing on energy matters. Mr. Hayes is the Vice-Chairman of the national conservation group, American Rivers, and he is the former Chairman of the Board of the Environmental Law Institute. Mr. Hayes was the Deputy Secretary of the Interior during the Clinton Administration. During the 2007-2008 academic year, Hayes was a Consulting Professor at Stanford University’s Woods Institute for the Environment.

Department of Energy Review Team Leads
Elgie Holstein was a Senior Energy Policy Advisor to the Obama for America Presidential Campaign. Under President Clinton, he was Assistant Secretary of Commerce for the National Oceanic and Atmospheric Administration; Associate Director for Natural Resources, Energy and Science at the Office of Management & Budget; Chief of Staff at the Department of Energy; and Special Assistant to the President for Economic Policy at the National Economic Council. He was also Director of State-Federal Relations for energy and environmental programs for the National Conference of State Legislatures, and worked as a congressional aide.

Elizabeth Montoya is currently a Consultant with Sealaska Corporation in Juneau Alaska where she is an expert in human resource management and strategic planning and advises the CEO and COO. Previously, she was Associate Director of Presidential Personnel in the White House, Deputy Chief of Staff at the Department of Energy, and Associate Director of Management and Administration at the Small Business Administration.

Sue Tierney is a Managing Principal and expert on economics, regulation and policy in the electric and gas industries at Analysis Group. She previously served as Assistant Secretary for Policy at the Department of Energy, under President Clinton; Secretary of Environmental Affairs in Massachusetts under Governor Weld; and Commissioner at the Massachusetts Department of Public Utilities under Governor Dukakis.

EPA Review Team Leads
Cecilia V. Estolano is the Chief Executive Officer of the Community Redevelopment Agency of Los Angeles. Prior to joining CRA/LA, Estolano practiced land use and environmental law at Gibson, Dunn & Crutcher. She has served as a Special Assistant to the City Attorney in the Los Angeles City Attorney’s Office, a Senior Policy Advisor to the Assistant Administrator for Air and Radiation at the U.S. Environmental Protection Agency and a member of the California Coastal Commission.

Lisa Jackson was appointed in 2006 by Governor Jon Corzine to lead New Jersey’s Department of Environmental Protection (DEP). Her past experience includes management responsibilities at the Environmental Protection Agency.

Robert Sussman is a Senior Fellow at the Center for American Progress (CAP). During the Clinton Administration, Sussman served as Deputy Administrator of the Environmental Protection Agency, where he played a leading role on Superfund, global warming, science policy and the North American Free Trade Agreement.

FERC Review Team Lead
Rose McKinney-James is the Managing Principal of Energy Works Consulting. Previously she served as the President and CEO of the Corporation for Solar Technology and Renewable Resources (CSTRR) and Chair of the Nevada Renewable Energy Task Force. Past positions also include Commissioner with the Nevada Public Service Commission, Director of the Nevada Department of Business and Industry, Chief of Staff for the City of Las Vegas and Project Manager for the Nevada Economic Development Corporation. McKinney-James serves on the Board of Directors of MGM-Mirage, Employers Insurance Group, Toyota Financial Savings Bank, the Energy Foundation, the American Council for an Energy Efficient Economy (ACEEE), and the Nature Conservancy. She is the Board Chair for Nevada Partners.

Department of the Interior Review Team Leads
John Leshy is a professor of law at the University of California, Hastings College of the Law in San Francisco. Previously he was Solicitor (General Counsel) of the U.S. Department of the Interior; Special Counsel to Chairman George Miller of the Resources Committee, U.S. House of Representatives; professor of law at Arizona State University in Tempe, Arizona; Associate Solicitor of Interior for Energy & Resources; and with the Natural Resources Defense Council (NRDC) in California and the Civil Rights Division of the U.S. Department of Justice in Washington.

Robert Anderson is a professor at the University of Washington School of Law and is the Director of the School’s Native American Law Center. After working for 12 years for the Native American Rights Fund, he was the associate solicitor for Indian affairs and Counselor to Interior Secretary Bruce Babbitt. He is a member of the Bois Forte Band of the Minnesota Chippewa Tribe.

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TODD WOODY, Green Wombat @ Fortune Magazine, November 13, 2008

The wind, solar and geothermal industries have wasted no time pressing the incoming Obama administration to implement an alternative energy agenda to spur investment and create jobs.

During a conference call Thursday, the leaders of the Solar Energy Industries Association, American Wind Energy Association and other trade groups lobbied for a plethora of legislation and policy initiatives. None of these proposals are new, but given Barack Obama’s campaign promises to promote alternative energy and the strengthened Democratic majority in Congress, the industry has the best chance in many years of seeing this wish list made real.

  • A five-year extension of the production tax credit for the wind industry (it currently has to be renewed every year) to remove uncertainty for investors.
  • A major infrastructure program to upgrade the transmission grid so wind, solar and geothermal energy can be transmitted from the remote areas where it is produced to major cities. Obama advisor Eric Schmidt, CEO of Google, recently joined with General Electric chief Jeff Immelt to launch a joint initiative to develop such smart grid technology as well as push for policy changes in Washington to allow the widespread deployment of renewable energy by rebuilding the nation’s transmission system.
  • Impose a national “renewable portfolio standard” that would mandate that utilities obtain a minimum 10% of their electricity from green sources by 2012 and at least 25% by 2020. Two-thirds of the states currently impose variations of such requirements.
  • Mandate that the federal government – the nation’s single largest consumer of electricity – obtain more energy from renewable sources.
  • Enact a cap-and-trade carbon market.

“If the administration and Congress can quickly implement these policies, renewable energy growth will help turn around the economic decline while at the same time addressing some of our most pressing national security and environmental problems,” the green energy trade groups said in a joint statement.

No doubt those measures are crucial to spurring development of renewable energy and creating green collar jobs. But the major obstacle confronting the alt energy industry right now is the credit crunch that is choking off financing for big wind and solar projects and scaring away investors from more cutting-edge but potentially promising green technologies.

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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.

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MARTIN LAMONICA, CNET, November 5, 2008

Energy and environmental policy is poised for dramatic change under an Obama administration even with a slumping economy.

With the incoming administration and Congress, renewable energy advocates and environmentalists said they anticipate a comprehensive national energy plan focused on fostering clean-energy technologies.

“The election is over. Now the hard work begins,” wrote Dan Farber, a professor of law at the University of California at Berkeley and a member of the lobbying group Cleantech & Green Business for Obama. “Change is on the way.”

Obama’s energy plan, detailed fully earlier this year, is ambitious. It calls for a $150 billion investment in clean technologies over 10 years, aggressive targets for greenhouse emission reductions, and programs to promote energy efficiency, low-carbon biofuels, and renewable energies.

But a troubled economy–among other barriers–means that bold, new energy legislation, notably caps on greenhouse gas emissions, is unlikely to pass in the first years of an Obama administration, according to experts.

Instead, the Obama presidency is expected to first push for smaller yet significant measures, such as efficiency and renewable energy mandates, and then lay the groundwork for far-reaching climate initiatives, they said.

“One of the biggest setbacks is trying to find the money to pay for all of this. This isn’t free,” said David Kurzman, managing director of Kurzman CleanTech Research. “Reality will set in and trying to find money…is really going to temper the possibilities over the next 12 months.”

Winners and losers
Cleantech company executives note that during the campaign, Obama articulated his belief that environmental protection and economic development can be closely related. During Obama’s acceptance speech Tuesday night, his reference to “new energy to harness and new jobs to be created” could be read in two ways–a call for political involvement or for alternative-energy sources.

In an interview with Time magazine in October 2008, he said, “From a purely economic perspective, finding the new driver of our economy is going to be critical. There is no better potential driver that pervades all aspects of our economy than a new energy economy.”

Cleantech professionals expect that energy and the environment, which were hot-button issues during the campaign, to continue to command the attention of politicians and the electorate. And the combination of a Democratic-controlled Congress and Obama administration means that government stimulus spending targeted at the energy business is a strong possibility.

“There’s a growing sense that investing in infrastructure, even if it means more deficit spending, is a good thing because it will help economic growth in the short and long term,” said Ethan Zindler of research firm New Energy Finance. “And green energy has come to be regarded as a 21st-century infrastructure play.”

Some technologies stand to benefit more than others if Obama’s administration is successful in implementing its proposals.

Renewable energies. Obama has called for a national renewable portfolio standard to mandate that utilities get 10% of electricity from renewable sources–wind, solar, and geothermal–by 2012, and 25% by 2025. “That’s the backbone the country needs to invest in,” said Rhone Resch, president of the Solar Energy Industry Association.

Although more than half the states already have renewable portfolio standards, many southern states have balked at national standards because they say they do not have sufficient renewable energy resources.

In this case, having an activist federal government, as Obama’s proposals suggest, may meet resistance from the states because electric utilities are regulated by a mix state and federal agencies. “It’s not just a question of money. It’s also a question of governance and public policy,” said Jim Owen, a representative for the Edison Electrical Institute.

In the recently passed financial bailout package, solar energy received an eight-year extension of federal tax credits, while wind received only a one-year extension. The election increases the chances that wind energy will be extended further.

Efficiency and smart grid technology. Obama’s plan calls for a power grid modernization program and stricter building efficiency codes in federal buildings. That means efficiency products such as demand response, advanced metering and sensors to monitor usage should further benefit from government incentives, said Kurzman.

A federal initiative to establish interconnection standards and bulk up interstate transmission lines would make power generation of all kinds more efficient and allow utilities to use more renewable sources. “A 50-state role to transmission just doesn’t get the job done. You need a federal planning and facilitation,” said Rob Church, vice president of research and industry analysis at the American Council on Renewable Energy (ACORE).

Biofuels. Hailing from the corn-producing state of Illinois, Obama is expected to continue supporting ethanol. However, Brooke Coleman, executive director of the New Fuels Alliance, noted that Obama appears to understand that the biofuels industry needs to transition to nonfood feedstocks, such as wood chips or algae, in order to be sustainable.

Coleman said that strong federal policies are required for biofuels to crack into the fossil fuel industry.

“There is not a free market in the fuel sector. There’s no real competition in the wholesale supply chain–it’s completely owned by oil,” Coleman said. “You have to be pretty heavy-handed to fundamentally correct this market.”

Auto. Obama has called for increasing fuel efficiency, tax credits for plug-in hybrid cars, and loan guarantees so that automakers can “retool.”

But struggling auto makers–said to be running dangerously low on cash–will need government aid in the coming months to prevent larger harm to the economy, argued David Cole, the chairman for the Center for Automotive Research. For that reason, he expects government leaders of all kinds to be supportive.

“Politically, the issue here is pretty stark and cost of keeping the auto industry in game is whole lot less than of a major failure,” Cole said.

Fossil fuels and nuclear. During the campaign, Obama said he would allow increased domestic oil and gas drilling as well as investments in so-called clean coal technology where carbon emissions are stored underground. Companies that have coal gasification technologies stand to benefit because they are cleaner source of electricity, said Kurzman.

In the campaign, Obama voiced caution on storing nuclear waste. But during the second presidential debate, Obama said he backs nuclear power “as one component of our overall energy mix.”

Skip Bowman, president of the Nuclear Energy Institute, said Tuesday he expects the new Congress and administration to continue its support of nuclear because it addresses energy and climate change.

Counting carbon
Longer term, the broadest policy change on energy and environment will be climate-change regulations. Obama has called for an 80 percent reduction of greenhouse gas emissions from 1990 levels by 2050 through a federal cap and trade system. Pollution rights would be auctioned, at least partially, which would create a fund for clean technology programs.

Large polluters, like chemical companies and utilities that rely heavily on coal, are the ones that will be most affected. But given that there is stronger political will to tackle energy security than climate change, policies to promote domestic energy production and efficiency are likely to take precedence over cap and trade, said New Energy Finance’s Zindler.

Still, the new administration can accomplish a great deal on renewable energy without having to pass multibillion-dollar legislation, said Scott Sklar, a renewable energy lobbyist and president of the Stella Group. Using only the federal government’s purchasing power to integrate green building technologies and addressing grid interconnection issues, for example, can be done without passing laws.

“Existing programs can be tweaked to accommodate the new vision,” Sklar said. “Depending on how you structure things, you could have a quick and profound impact on new technologies.”

New Fuel Alliance’s Coleman said that the biggest danger to the Obama administration and new Congress is not “overplaying their hand” and pushing more extreme environmental policies.

“I firmly believe that the linchpin to this entire game is allowing agriculture to play a role in diversifying our energy, whether it be wind, solar, using rural areas for geothermal or wind corridors,” he said. “More extreme positions like trying to end coal result in failure and missed opportunities.”

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Publisher Note:  FERC Chairman Joseph T. Kelliher announced his resignation effective January 20, 2009.

GERRY NORLANDER, Pulp Network, November 5, 2008

With the election of a new president comes renewed speculation about leadership change at the Federal Energy Regulatory Commission (FERC) in an Obama administration.

The president . . . can designate a new chairman, who generally will belong to the party in the White House. But the president must await a commission vacancy to actually appoint a new commissioner and shift the balance of power if there is a change of party. No more than three commissioners can belong to the same party, so currently FERC has three Republican commissioners and two Democrats. Normally, however, a chairman who is replaced will not want to remain as a commissioner and will resign. 

Currently FERC is filled with a bipartisan cadre of five pro-deregulation commissioners, all appointed by President Bush, who appear intent on approving mega mergers of utility holding companies and implementing the discredited Enron agenda to supplant traditional regulation with reliance on unfiled, unreviewable, and unrefundable “market-based rates” and “organized” spot markets such as those run by the NYISO.

As with recent presidents of both parties, the incoming president received significant campaign financial support from utility executives, investment bankers, and energy traders who still promote electricity deregulation, but hope still remains for change in the interest of consumers, for whose protection the Federal Power Act was enacted in 1935.

President Obama will name a new FERC Chair, to replace the current Chairman, Joseph T. Kelliher.  A former lobbyist, congressional staff lawyer for Texas Rep. Joe Barton, and coordinator of Vice President Cheney’s controversial energy task force, Kelliher steadily continued the agency’s efforts to deregulate wholesale electric rates. Under his leadership FERC continued its unresponsiveness to widespread consumer concerns about unreasonable rates and problems with the spot markets and “market-based rates” FERC approved in an effort to supplant traditional filed rate regulation.  Although he received Senate confirmation of a new term earlier this year, it has been reported that Kelliher agreed with Senator Harry Reid to resign if a democrat is elected President. That time has now come.

Commissioner Suedeen Kelly was mentioned a year ago as a possible FERC Chair in a democratic administration. A protege of deregulation democrat Senator Bingamon, Chairman of the Senate Energy and Natural Resourcees Committee, she was formerly an energy industry lobbyist, law professor, Chair of the New Mexico Public Service Commission, and was an attorney for the California ISO. It is not clear, however, if the democratic president envisioned last year when her name was floated for Chair was Barack Obama. If, instead of becoming Chair, another chair is picked, Commissioner Kelly might move on when her seat becomes vacant June 30, 2009.

Assuming that Chairman Kelliher leaves, will the two other republican commissioners making up the current majority — Marc Spitzer (former Arizona utility regulator and republican cousin of former New York Governer Eliot Spitzer) and Philip Moeller (a former utility lobbyist) — stay on under a new Chairman? 

FERC has grown in importance to electricity consumers in states like New York that allowed their utilities to sell their power plants (formerly operated on a state-regulated cost of service basis) to new owners with “market-based rates” from whom they now must buy power for customers based on what the market will bear in flawed FERC-approved spot markets. It is thus essential for the new President’s FERC picks to be sensitive to more than the usual major utility, power generators, energy traders, lobbyists, and other institutional market “stakeholders.” The new picks must be more dedicated than the current FERC to the achievement of just and reasonable electricity rates, as the Federal Power Act requires. 

UPDATE:

November 25, 2008 — Obama Picks Transition Team for DOE, FERC.

December 8, 2008 — Las Vegas Review Journal says U.S. Senate Majority Leader Harry Reid supports Jon Wellinghoff for FERC Chairman:

At the Federal Energy Regulatory Commission, one of two Democrats is Reid ally Jon Wellinghoff, a former Nevada public utility consumer advocate. In Washington, Wellinghoff has aggressively pushed for energy efficiency and renewable technology, Energy Daily reported.

Asked about Wellinghoff in a recent interview with the Review-Journal, Reid said he definitely believes the Nevadan should chair the FERC.

December 18, 2008 — Other names floated for FERC commissioners or chairmen include two state utility commission chairmen, Charles Box from the Illinois ICC and John Norris from the Iowa Utilities Board.

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MATT NAUMAN, San Jose Mercury News, September 27, 2008

Al Gore said in San Jose on Saturday that the climate crisis deserves the same type of attention and money from Washington that the financial meltdown is getting.

“Instead of a focus only on a bailout, we need to bail in renewable energy,” Gore said during a 50-minute speech at the Civic Auditorium.

Gore, who turned 60 this year, was a three-term U.S. senator from Tennessee, vice president for eight years and narrowly lost the 2000 presidential election to George Bush. But it was his move toward environmentalism, symbolized by his starring role in the 2006 documentary “An Inconvenient Truth” and his subsequent Nobel Peace Prize that turned him into an international crusader against global warming.

That’s what brought him to San Jose on Saturday, as the keynote speaker for the three-day West Coast Green conference. It included presentations on a variety of green-living topics, plus an exhibit hall of green-building products.

Wearing a navy suit, but no tie, Gore came across as part science teacher, part economist and part environmental evangelist. His remarks, which included a funny story or two and mentions of Gandhi and Martin Luther King, drew frequent applause and a few standing ovations.

Indeed, the speech had something of a rock concert feel. Loud music played before the event started. Many in the casually dressed crowd of about 2,000 took cell-phone photos once Gore walked onto the stage. And his comments about the dangers of climate change, its impact on the world, and how it might be solved, sounded like Gore’s greatest hits.

He traced the current crisis with the financial markets to the subprime mortgage mess. There’s also a “subprime carbon” mess that’s shaking the world’s economy, he said, one that puts 70 million tons of carbon dioxide into the air each day. And companies that deny it’s harmful are engaging in “a form of stock fraud,” he said.

Plans to seek oil from Canadian oil shale and tar sands are “utter and complete madness, complete insanity,” he said. And new coal plants should be banned in the United States, he said.

The world continues to look to America for leadership in solving global warming, he said, and it’s not getting it. “Every other nation that has failed to take action shares the same excuse for not doing so. They all point to the United States, and say, if the United States isn’t doing it, why should we,” he said. He linked that comment to the November election, but didn’t mention either Barack Obama or John McCain by name. But he repeated his quote from the Democratic convention, where he talked about McCain following Bush, saying “I’m for recycling, but this is ridiculous.”

Within 10 years, the United States should get 100% of its electricity from renewable sources. “It’s time to think boldly,” he said. “We’ve had enough of little tiny policies.

He called for a national smart grid with expanded, underground transmission lines that add solar, wind and geothermal power to the national’s energy supply. And he mentioned Silicon Valley, where he now works as a partner at the Kleiner Perkins Caufield & Byers venture-capital firm, as being integral to achieving something like a Moore’s Law for renewable technologies where efficiencies increase and prices fall at a consistent pace.

Gore was preceded on stage by California Attorney General Jerry Brown. He alluded to his stint as California’s governor three decades ago when he was derided as “Governor Moonbeam” for pushing for greener buildings and solar energy. He said that those have become popular notions today.

He, too, made reference to the $700 billion bailout package being negotiated in Washington, D.C.

“Why not spend $700 billion for solar, for efficiency, for conservation?” Vice Presideant Gore asked the audience. “Why not?”

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MendoCoastCurrent, John Podesta, September 9, 2008

ctr-4-american-progressOn September 9, 2008, the Center for American Progress, a Washington think tank headed by John Podesta, former Chief of Staff to U.S. President Bill Clinton, published a report by entitled “Green Recovery: A New Program to Create Good Jobs and Start Building a Low-Carbon Economy.” This report may serve as a road map for the new President, Barack Obama. Podesta now heads President-Elect Obama’s transition team. As such, it may be instructive to review its contents as a guide to the Obama Administration’s energy policy.

The signs are clear: Our economy is in trouble. Falling home prices, foreclosures, bank failures, a weaker dollar, rising prices for gas, food, and steel, and layoffs in banking, construction, and manufacturing sectors are all indicators of serious economic strain-following a long period in which the middle class went nowhere even while the economy grew as a whole. What’s more, evidence suggests the current downturn will continue for at least another year.

At the same time, we face a growing climate crisis that will require us to rapidly invest in new energy infrastructure, cleaner sources of power, and more efficient use of electricity and fuels in order to cut global warming pollution. There is much work to be done in building smart solutions at a scale and speed that is bold enough to meet this gathering challenge.

It is time for a new vision for the economic revitalization of the nation and a restoration of American leadership in the world. We must seize this precious opportunity to mobilize the country and the international community toward a brighter, more prosperous future. At the heart of this opportunity is clean energy, remaking the vast energy systems that power the nation and the world. We must fundamentally change the way we produce and consume energy and dramatically reduce our dependence on oil. The economic opportunities provided by such a transformation are vast, not to mention the national security benefits of reducing oil dependence and the pressing need to fight global warming. The time for action is now.

Today, the Center for American Progress releases a new report by Dr. Robert Pollin and University of Massachusetts Political Economy Research Institute economists. This report demonstrates how a new Green Recovery program that spends $100 billion over two years would create 2 million new jobs, with a significant proportion in the struggling construction and manufacturing sectors. It is clear from this research that a strategy to invest in the greening of our economy will create more jobs, and better jobs, compared to continuing to pursue a path of inaction marked by rising dependence on energy imports alongside billowing pollution.

The $100 billion fiscal expansion that we examined in this study provides the infrastructure to jumpstart a comprehensive clean energy transformation for our nation, such as the strategy described in CAP’s 2007 report, “Capturing the Energy Opportunity: Creating a Low-Carbon Economy.” This paper shows the impact of a swift initial investment in climate solutions that would direct funding toward six energy efficiency and renewable energy strategies:

  • Retrofitting buildings to increase energy efficiency
  • Expanding mass transit and freight rail
  • Constructing “smart” electrical grid transmission systems
  • Wind power
  • Solar power
  • Advanced biofuels

This green recovery and infrastructure investment program would:

  • Create 2 million new jobs nationwide over two years
  • Create nearly four times more jobs than spending the same amount of money within the oil industry and 300,000 more jobs than a similar amount of spending directed toward household consumption.
  • Create roughly triple the number of good jobs-paying at least $16 dollars an hour-as spending the same amount of money within the oil industry.
  • Reduce the unemployment rate to 4.4% from 5.7%(calculated within the framework of U.S. labor market conditions in July 2008).
  • Bolster employment especially in construction and manufacturing. Construction employment has fallen from 8 million to 7.2 million over the past two years due to the housing bubble collapse. The Green Recovery program can, at the least, bring back these lost 800,000 construction jobs.
  • Provide opportunities to rebuild career ladders through training and workforce development that if properly implemented can provide pathways out of poverty to those who need jobs most. (Because green investment not only creates more good jobs with higher wages, but more jobs overall, distributed broadly across the economy, this program can bring more people into good jobs over time.)
  • Help lower oil prices. Moderating domestic energy demand will have greater price effects than modest new domestic supply increases.
  • Begin the reconstruction of local communities and public infrastructure all across America, setting us on a course for a long-term transition to a low-carbon economy that increases our energy independence and helps fight global warming. Currently, about 22% of total household expenditures go to imports. With a green infrastructure investment program, only about 9% of purchases flow to imports since so much of the investment is rooted in communities and the built environment, keeping more of the resources within the domestic economy.

Our report looked at investments that were funded through an increase in near-term government spending, which could ultimately be repaid by future carbon cap-and-trade revenues. These sources of new investment included the following funding mechanisms:

  • $50 billion for tax credits. This would assist private businesses and homeowners to finance both commercial and residential building retrofits, as well as investments in renewable energy systems.
  • $46 billion in direct government spending. This would support public building retrofits, the expansion of mass transit, freight rail, smart electrical grid systems, and new investments in renewable energy
  • $4 billion for federal loan guarantees. This would underwrite private credit that would be extended to finance building retrofits and investments in renewable energy.

A comprehensive clean energy agenda is essential to the future of our country. The green recovery and infrastructure investment described here is doable in the early days of a new administration. It would enable our country to take significant steps, through energy efficiency and renewable energy development, to move toward a low-carbon economy, while Congress and the next administration move toward the swiftest possible implementation of an economy-wide greenhouse gas cap-and-trade program.

The next president and lawmakers can pledge to repay the Treasury the cost of the green infrastructure recovery program from cap-and-trade auction revenue. The plan increases public spending in the short term when a near-recession economy needs greater impetus to growth; but it remains consistent with fiscally responsible long-term plan to reduce the debt as a share of GDP, after the economy recovers.

CAP looks forward to continuing to work on the shared mission to reap all of the benefits provided by the transition to a low-carbon economy and discussing this work in greater detail.

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FELICITY BARRINGER, The New York Times, August 27, 2008

Santa Barbara County became a symbol of the national environmental movement’s passionate opposition to offshore oil drilling when an oil spill devastated its coastline in 1969. On Tuesday, it became a symbol of the changing national mood as its board of supervisors debated whether to welcome new wells along California’s shores.

The supervisors voted 3 to 2 on Tuesday to end the county’s opposition to offshore drilling, although the vote will have no practical impact on state or federal policies.

But the speed with which opinions have changed in Santa Barbara County as gasoline prices have climbed has been astonishing. The vote there reinforces, at the local level, a shift evident in national polls and in the delicate willingness of Democratic leaders like Senator Barack Obama, the presumptive presidential nominee, and the House speaker, Nancy Pelosi of California, to open the door to limited coastal drilling.

Three weeks ago, the Public Policy Institute of California released a poll showing that 51% of Californians now approve of offshore drilling, a 10-point increase in a single year. “I don’t think any of us expected to see the day when there’d be more than 50% support for oil drilling,” said Mark Baldassare, the institute’s research director.

Despite the liberal, environmentally conscious aura that has surrounded the wealthy coastal communities of Santa Barbara and Montecito, the county as a whole, which also includes the fast-growing, less-wealthy inland communities of Santa Ynez and Santa Maria, has been less easily pigeonholed politically.

“It’s a bipolar situation,” said Antonio Rossman, an environmental lawyer in San Francisco. “You’ve got some of the strongest environmentalists in the country, yet this is where Ronald Reagan had his ranch,” Mr. Rossman said, adding, “The Santa Barbara County Board of Supervisors has always split as close as anyone can on issues of preservation versus development.”

The swing vote on the five-member board, Supervisor Brooks Firestone, said in a telephone interview on Tuesday that he was ending his opposition because offshore drilling was no longer a significant threat to the coastal environment.

“I did a lot of research that brought me to realize that 1969 can’t happen again,” Mr. Firestone said. He joined two supervisors who are longtime proponents of drilling in voting in favor of writing a letter asking Gov. Arnold Schwarzenegger, a Republican, to rethink his support for the Congressional moratorium on offshore drilling.

Michael Chrisman, California’s secretary for resources, made it clear in a telephone interview that this was not going to happen. Asked about the changes in the national and local moods, Mr. Chrisman said: “It’s obvious what’s going on. The presidential election’s going on.”

He said the issue was driven by the “high price of gasoline and need of country to become more energy independent.”

“It’s a healthy debate,” he added. “But from our perspective, our position hasn’t changed. The governor has been very clear in his opposition to increased drilling off the coast of California.” More than 80 people signed up to speak at the supervisors’ meeting Tuesday, and Mr. Firestone said the testimony was often emotional.

“People want wind power, solar power, less dependence on foreign oil,” he said. “Fair enough. We all want that.” But he said he expected economic pressure to find new oil supplies to reach a breaking point eventually and force widespread leasing of tracts off the coast. “Better to do it gradually, safely and intelligently,” he said, “than wait for the inevitable conclusion.”

Tupper Hall, a spokesman for the Western States Petroleum Association, said in a telephone interview that the debate in Santa Barbara was emblematic of a national mood swing prompted in part by a desire to be less dependent on Middle Eastern oil. “This national — and now local — dialogue that is now taking place we believe is very healthy,” Mr. Hall said. “It is an acknowledgment, I believe, that the public understands that supply really does matter.”

Finding safe and appropriate ways to increase the supply, he added, is “one of the ways to address instability, volatility in the global markets.”

But Warner Chabot, a vice president of the Ocean Conservancy, a national environmental group, said offshore drilling would not decrease oil prices.

“Exposing coastal areas and beaches to oil drills and environmental degradation for a few weeks’ supply isn’t a national energy policy,” Mr. Chabot said.

President Bush put the issue at the center of the national debate in June when he proposed rescinding an executive order against offshore drilling originally imposed by his father. He ended that moratorium in July and called on Congress to lift the ban it has imposed for 27 years.

Senator John McCain, the presumptive Republican presidential nominee, was in Santa Barbara just weeks earlier to outline his energy policy — one that included a new willingness to encourage drilling on the outer continental shelf.

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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.”

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LARRY ROHTER, The New York Times, August 5, 2008

Senator Barack Obama altered his position on Monday to call for tapping the nation’s Strategic Petroleum Reserve to lower gasoline prices as he outlined an energy plan that contrasts with Senator John McCain’s greater emphasis on expanded offshore drilling and coal and nuclear technology.

In a speech here and in a new advertisement, Mr. Obama, the presumptive Democratic nominee, also sought to portray his Republican rival, Mr. McCain, as “in the pocket” of oil giants that are profiting from gasoline priced at more than $4 a gallon. And in his speech, Mr. Obama called for a windfall profits tax on oil companies to finance rebates for Americans.

At the heart of Mr. Obama’s proposals is a focus on fostering alternative energy development by investing $150 billion in emerging technologies and renewable fuels. Seeking to put a million fuel-efficient hybrid plug-in automobiles on the road, he said that he would offer a $7,000 tax credit to buyers, the overall cost of which he did not specify. In addition, Mr. Obama said his goal was to have 10 percent of the country’s energy needs met by renewable resources by the end of his first term, more than double the current figure.

While focusing on alternative energy production, Mr. Obama has veered in recent days toward increasing access to fossil fuels, both in seeking to tap the strategic oil reserve and in softening his opposition to offshore oil drilling. He said he might be willing to accept some exploration of limited offshore drilling as part of a more comprehensive energy bill that would include things he favors, like renewable fuels and batteries for electric-powered cars.

The proposals Mr. Obama offered Monday represented an effort to return the campaign’s focus to bread-and-butter issues after he found himself repeatedly on the defensive last week against a newly aggressive McCain campaign.

“We should sell 70 million barrels of oil from our Strategic Petroleum Reserve for less expensive crude, which in the past has lowered gas prices within two weeks,” Mr. Obama said. “Over the next five years, we should also lease more of the National Petroleum Reserve in Alaska for oil and gas production, and we should also tap more of our substantial natural gas reserves and work with the Canadian government to finally build the Alaska natural gas pipeline, delivering clean natural gas.”

Mr. McCain and his campaign have been increasingly tweaking Mr. Obama and his energy policy. The McCain campaign distributed tire pressure gauges outside the event here in response to Mr. Obama’s statement last week that Americans could reduce gasoline use substantially if they kept car tires at optimum pressure. Mr. McCain has called Mr. Obama “Dr. No” and said that his energy policy could be reduced to the phrase “just say no” to proposals to increase energy production.

“We have to drill here and drill now,” Mr. McCain said Monday in Lafayette Hill, Pa. “Not wait and see if there’s areas to explore, not wait and see if there’s a package to put together. But drill here and drill now.”

Mr. McCain has focused much more on the supply side of the energy equation, supporting increased reliance on nuclear power, the use of so-called clean coal technology and expanded offshore drilling. But he has called for halting purchases to replenish the strategic oil reserve, rather than tapping into it.

Aides to Mr. Obama said that he now favored releasing light oil from that emergency stockpile, 707 million barrels stored in salt caverns, and replacing it with heavier oil, which they said would be more appropriate for the country’s long-term energy needs. They described that action — meant to help drive down oil prices, which have begun falling in the last month after a long, sharp increase — as a “limited swap” rather than a depletion of the reserve.

Mr. Obama said that through a mixture of investment, discipline and more restrained consumption it would be possible to completely eliminate oil imports from the Middle East and Venezuela within 10 years. Through a combination of similar measures, he said, Americans could at the same time reduce electricity consumption by 15% and create 5 million jobs.

“I will not pretend we can achieve them without cost, or without sacrifice, or without the contribution of almost every American citizen,” Mr. Obama said of his objectives. “But I will say that these goals are possible, and I will say that achieving them is absolutely necessary if we want to keep America safe and prosperous in the 21st century.”

Repeating his call for a windfall profits tax on companies like Exxon-Mobil, which he singled out in his speech on Monday, Mr. Obama said he would use part of the tax to provide consumers with an “emergency energy rebate” of $1,000 per family.

Mr. Obama and his campaign have criticized Mr. McCain for accepting what they call excessive campaign donations from energy interests. Campaign Money Watch, a watchdog organization, said the McCain campaign received a burst of donations in June from oil company employees after he came out in favor of offshore drilling. Together, Hess employees or their relatives contributed more than $300,000 in June to Mr. McCain’s joint fund-raising committee with the Republican National Committee, according to campaign finance records.

Brian Rogers, a spokesman for the McCain campaign, said officials had examined the donations and found nothing untoward.

Mr. Obama offered details of his energy plan as Democrats have been under continuing pressure to allow offshore drilling. Though Congress is in its August break, a band of Republicans occupied the darkened House floor Monday to criticize the Democratic leadership for refusing to allow a vote on lifting a ban on drilling off much of the nation’s coastline before heading out of town.

About 25 lawmakers, many from the most conservative wing of the Republican Party, railed throughout the day at Speaker Nancy Pelosi, Democrat of California, saying her “San Francisco mentality” was impeding domestic energy production.

Republicans circulated a petition to urge Ms. Pelosi to call the House back into session, and some called for President Bush, who was on his way to China for the Olympics, to demand that Congress return. The White House said Monday that such a step was unlikely.

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LAURA MANDARO, MarketWatch, June 26, 2008

SAN FRANCISCO – California released a draft plan on Thursday to reduce the state’s projected greenhouse gas emissions by nearly one-third, in part by creating a cap and trade program that could serve as a blueprint for a national carbon emissions market.

The 77-page “climate change draft scoping plan” lays out the framework for California to meet the goals of a 2006 law signed by Gov. Arnold Schwarzenegger that requires the state to slash its greenhouse gas emissions to 1990 levels by 2020.

This target means electric utilities, industrial users, fuel refiners such as Chevron Corp. and ConocoPhillips and builders will have to lower their combined output of carbon dioxide by one-tenth from today’s levels and 30% from projected 2020 emissions of the gas thought to contribute to global warming.

The success of California’s efforts to scale back greenhouse gas emissions using a mix of regulations and market mechanisms could provide a roadmap for a national standard, largely thanks to the state’s size and the aggressive goals it has set.

“It certainly paves the way,” said Milo Sjardin, head of the North American division of New Carbon Finance, a carbon emissions research and analysis firm. “Any federal program may take some of California’s experience on board,” he said.

The California plan also seeks to expand the amount of electricity utilities such as PG&E Corp. and Edison International generate from renewable resources to 33% by 2020. Today, just 12% of the state’s electricity comes from wind, solar, geothermal and other renewable sources.

Cap and trade to launch in 2012

The nation’s most populous state says it will achieve these ambitious goals by putting in place strict limits on greenhouse gas emissions, caps that give users of fossil fuel a financial incentive to put in place heavier pollution controls.

A key part of this plan is the establishment of a market to allow companies to trade their carbon allowances with companies from neighboring Western states and Canadian provinces that are producing less than their allowed emissions — or that engage in an activity, such as planting trees, that lowers emissions.

The head of the panel charged with implementing the state’s global warming law said board members are using as a model the cap-and-trade program established by the U.S. government to restrict emissions that cause acid rain, which was part of the 1990 Clean Air Act.

“When industry knew they had to come under a cap, they came up with measures that were much cheaper than anyone thought,” said Mary Nichols, chairman of the California Air Resources Board. “Having a cap out there spurs the innovation,” she said in a conference call with reporters.

California’s cap and trade program, set for launch in 2012, will also present national companies with a second set of standards with which to comply. A group of Northeastern states is planning to launch a smaller cap and trade program next year.

The addition of another set of regulations “puts increasing pressure on the federal government to put something in place to level the playing field,” said New Carbon Finance’s Sjardin.

Sens. Joseph Lieberman, an independent from Connecticut and John Warner, a Republican from Virginia, last year introduced a national climate bill – which the Senate tabled in June — designed to cut greenhouse-gas emissions by 70% by 2050.

Both major-party presumptive presidential candidates, Republican Sen. John McCain and Democratic Sen. Barack Obama have said they support a national standard for carbon emissions.

Development of a U.S. carbon-trading market is following the rapid growth of the now $50 billion carbon-trading market in Europe, where corporations have been trading emissions-reductions credits as part of meeting the Kyoto Protocol. California’s market will likely start at a much smaller level. New Carbon Finance’s Sjardin estimates it could reach $10 billion by 2015.

If the entire country were to incorporate such a program, the size of the market could hit $1 trillion by 2020, he says.

Bringing to fruition California’s plan, let alone a national version, faces stumbling blocks.

In the state’s Senate, the Republican caucus is pushing for a delay of certain parts of the 2006 bill it says make it too expensive for businesses in a time of economic duress.

Nonetheless, the state’s largest utilities are preparing for the state to push through the caps, which will cover 85% of California’s greenhouse gas emissions.

San Francisco-based utility PG&E says 13% of its power comes from renewable energy sources. By 2012, that level should reach about 22%, said Keely Wachs, a spokesman for the utility, which serves 15 million customers in Northern and Central California.

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