OWOE Staff:The energy world has been rocked by a number of crucial events during the past two months. In the transition to renewable energy and more particularly in the removal of fossil fuels form the energy mix, there are possibly three history-making game changers:
The International Energy Agency (IEA) came out with its report on the state of the climate, and it was brutal toward fossil fuels. It laid out the reality of the current climate crisis and pointed to one clear action required to prevent catastrophic global warming: “The world has a choice – stop developing new oil, gas and coal fields today or face a dangerous rise in global temperatures.” It is important to point out that the report didn’t call for the immediate elimination of fossil fuels as energy sources. The IEA understands the need for some transition period to a fossil-free future. But the transition needs to be speedy, and the IEA feels that the best way to do this is to stop all new developments, live off the current reserves, and use that time to develop the technologies, change behavior and make the transition.
President Joe Biden issued his sweeping climate goal to cut US emissions in half by 2030 ahead of convening an historic summit with 40 world leaders to demonstrate American leadership in the quest to elimination of fossil fuels by 2050.
ExxonMobil, Royal Dutch Shell, and Chevron were rebuked by shareholders and the courts for not aligning their strategies with the threat of climate change.
OWOE Staff: So what’s going on with the power grid in Texas? Last week the state was hit by a polar vortex winter storm (Uri) that brought snow and ice and record low temperatures. Such storms aren’t especially rare – it snows and ices in Houston about every ten years. But this time it created one of the biggest power outages in US history (Fig 1), and the Texas power grid came within minutes of failure. Then the real fun began. The Governor blamed the power failures on the wind turbines in West Texas freezing up, but had to retract the comment almost immediately when the grid operator, ERCOT (Electric Reliability Council of Texas), announced that the majority of the power outages were due to gas supply shortages and freezing of the conventional thermal power plants. A former Texas Governor claimed that Texans would rather endure power failures than have more regulation of the industry. Senator Ted Cruz, from Texas, who had a history of denouncing renewable energy as the cause for California’s power outages fled the cold to take his family to Cancun and immediately had to fly back due to public outrage. A photo of a helicopter deicing wind turbines in Texas went viral as an example of renewable power being dependent on fossil fuel and chemicals, until the photo was identified as actually being an extreme case of deicing an old-style turbine in Sweden from 2014. Texans who signed up for electricity plans that charge based on wholesale electricity prices are now facing bills in the thousands of dollars. Etc, etc.
OWOE Staff: It’s a new year, we have a new president and administration, and we have new hope that the plan to vaccinate Americans is going to finally end the pandemic. What we don’t have is new thinking on what this country should be doing for a long term, rational and strategic energy policy. OWOE believes it is the right time to propose a comprehensive energy policy that balances America’s needs with the planet’s needs and is based on sound economics, realistic technology and good common sense. The OWOE energy policy combines several key elements, including: firm commitment to dramatically reduce dependence on fossil fuels in a planned and rational manner, sustainable investment in renewable technologies, and establishment of a North American Energy Alliance (NAEA) between the US and Canada to aggressively develop and globally sell our existing energy resources.
By OWOE Staff: Happy 2021 dear readers and supporters of OWOE. As everyone is aware, 2020 was a most unfortunate series of events, beginning with the release of a virulent pathogen from China which resulted in a wide range of foreseeable acute and long range economic, social and energy consequences. Thus, OWOE staff are working hard to analyze these consequences to provide meaningful insight about energy matters going forward. We plan a variety of interesting updates to our core energy information, tools and blogs this year and perhaps even a contest involving energy self-sufficiency at the local level. Many of the changes happening in the world of energy are the cumulative results of individual changes in consumption resulting from economic turmoil compounded by inept government policies and continuing industry business practices.
Note from your OWOE editor: Houston has always been a city whose fortunes have risen and fallen with the price of oil. Now it is being hit with two crises at the same time – the coronavirus pandemic which is significantly cutting oil demand, and the Saudia Arabia-Russia battle for market share which is flooding the world with oil and forcing down its price (see Fig. 1). The result has been immediate and drastic. The almost instantaneous drop in price from the $50-60 per barrel range to the $20-30 per barrel range is worse than the drop in 2014 that almost destroyed the US oil business, with some analysts predicting the possibility of $5/bbl oil. Oil companies are looking at every way possible to cut spending quickly, including cancelling projects, idling rigs, instituting hiring freezes, and laying off staff. Add on top of that the fear of transmission of the coronavirus and need for social distancing are having what could be a long-term impact on oil demand as well as making it even harder to work, assuming one is fortunate to keep a job in this climate.
It’s a new year and a new decade and time to make a bold prediction regarding developments in the energy industry and associated transportation industry. The last few years have been a wild ride for electrical vehicles (EVs) with Tesla continuously in the headlines. Will Tesla go bankrupt? Will Tesla change the way the world views automobiles? Is Tesla stock a good buy at $250/share (2019) or $550 (2020)? But other automakers have made their own headlines: Jaguar began sales of its iPace EV, Volkswagen began sales of its eTron, and Ford introduced its Mustang Mach-E. A prediction concerning EVs is warranted, but OWOE is going to go beyond EVs and make a prediction concerning the broader automobile industry: Within this next decade one of the three US legacy car makers will cease to exist.
With the news that this past July was the hottest month on earth since record keeping 140 years ago, satellite images of the Amazon and State of California burning, the most powerful hurricane ever measured in the Atlantic Ocean east of Florida, carbon dioxide emissions to the atmosphere rising again to near record levels after a brief leveling, and Swedish teenager Greta Thunberg’s stirring call to action while staring down both Donald Trump and Vladimir Putin, climate change has been a hot topic in 2019. While the scientific community remains nearly 100% aligned that global warming is driven by the burning of fossil fuels, a relatively small, yet powerful, group of naysayers fights the science. Who are these very powerful people, and why do they fight? One common characteristic – they are mostly baby boomers = the generation of Americans with an insatiable appetite for consumption and a strong resistance to change.
Every week seems to bring another attack by the Trump Administration against laws and regulations that have been instituted by prior administrations to protect the environment and fight climate change. The most recent is the campaign to deny California the right to set stricter automobile emissions standards than federal limits. It has caused yet another uproar among environmentalists and liberals and glee among climate change deniers and conservatives and will undoubtedly lead to many years of legal battles. But what is reality? In fact, this move, and all the others, are just meaningless actions that do little more than pander to the Administration’s fossil fuel campaign contributors and excite the hardcore Republican base ahead of the upcoming elections. The reality is that technology and market forces are driving the world inexorably and at an increasing pace toward a renewable energy future, despite the last-ditch efforts of the President and his supporters. Let’s look at some of the higher profile actions.
SA Shelley, WH Luyties: OWOE is a small site, with just a few dedicated and experienced staff who follow energy technologies, economics and policies. Occasionally, OWOE bloggers dare to forecast energy developments that tend to be contrarian, and, much to everyone’s surprise, they have been very good at forecasting trends correctly and ahead of much larger analytical organizations. Are we that good at more quickly analyzing publicly available information along with some insight and soft analysis? Or do we have access to the dark arts such as whiskey and voodoo?
I live in California. That gives me a front seat to virtually every new initiative and trend related to saving the planet, whether it is about turtles and plastic straws, banning single-use plastic bags, electric vehicles, or green energy. Although not the first state to adopt a Renewable Portfolio Standard (RPS), California has been one of the most aggressive in its timetable for replacing fossil fuel based electricity with carbon-free. In 2018, California updated its RPS to the requirement to achieve 60% of electricity sales from renewable sources by 2030 and 100% by 2045. Of course, California’s aggressive push toward renewables has triggered a wide range of reactions. For example, Michael Shellenberger of Environmental Progress has been pushing the idea that California’s electricity rates are significantly higher than the rest of the US (see Figure 1) and rising significantly faster because of its dependence on renewables. His culprit is renewable energy and his solution is to keep nuclear plants open. In contrast, Roger Sowell, who blogs about renewable energy issues, argues that California’s unique climate, geography, and large population make such differences to be expected.