Archive for the ‘Energy’ Category

Drinking water contamination caused by weak water wells and not by fracking

September 16, 2014

It is fashionable for environmentalists to blame fracking for all manner of evils as a matter of faith. They have proclaimed that fracking causes earthquakes, water table contamination, emission of dangerous gases, damage to house price levels and even damage to crops. Such claims are usually based on no evidence whatsoever but presented as gospel.

A new paper published in PNAS reports on real experimental measurements (not just a computer model) using noble gases to trace methane leakage into drinking water in 130 water wells in Pennsylvania and Texas. They find that drinking water contamination was caused by weak walls and well construction faults and not by fracking.

TH Darrah et al, Noble gases identify the mechanisms of fugitive gas contamination in drinking-water wells overlying the Marcellus and Barnett Shales, 

Significance

Hydrocarbon production from unconventional sources is growing rapidly, accompanied by concerns about drinking-water contamination and other environmental risks. Using noble gas and hydrocarbon tracers, we distinguish natural sources of methane from anthropogenic contamination and evaluate the mechanisms that cause elevated hydrocarbon concentrations in drinking water near natural-gas wells. We document fugitive gases in eight clusters of domestic water wells overlying the Marcellus and Barnett Shales, including declining water quality through time over the Barnett. Gas geochemistry data implicate leaks through annulus cement (four cases), production casings (three cases), and underground well failure (one case) rather than gas migration induced by hydraulic fracturing deep underground. Determining the mechanisms of contamination will improve the safety and economics of shale-gas extraction.

A key source of groundwater contamination (labeled 5, center right) caused by faulty well casings. Credit: Image courtesy of Thomas Darrah, The Ohio State University

Press Release:

….  neither horizontal drilling nor hydraulic fracturing of shale deposits seems to have caused any of the natural gas contamination.

“There is no question that in many instances elevated levels of natural gas are naturally occurring, but in a subset of cases, there is also clear evidence that there were human causes for the contamination,” said study leader Thomas Darrah, assistant professor of earth sciences at Ohio State. “However our data suggests that where contamination occurs, it was caused by poor casing and cementing in the wells,” Darrah said.

In hydraulic fracturing, water is pumped underground to break up shale at a depth far below the water table, he explained. The long vertical pipes that carry the resulting gas upward are encircled in cement to keep the natural gas from leaking out along the well. The study suggests that natural gas that has leaked into aquifers is the result of failures in the cement used in the well.

It’s coming, but don’t invest just yet in mining Helium-3 on the moon

August 16, 2014

Helium (4He) is the second most abundant element in the known Universe (after hydrogen) but only makes up 5.2 parts per million (ppm) of the Earth’s atmosphere. Helium-3 (3He) is an isotope of helium with two protons and one neutron. It is not radioactive and very rare on Earth (7 parts per trillion) but exists in recoverable concentrations in the lunar topsoil (in the top 2 -3 m of lunar regolith). It is even more abundant on the gas giants Jupiter, Saturn, Uranus and Neptune.

Lunar soil sample #75501 brought back by Apollo 17 in 1972 revealed the presence of He-3 and since then every country planning moon missions has the vision of mining for 3He on the moon and of vast quantities of energy production by means of a aneutronic fusion process on earth. (For old fogies like me, 1972 was the year of Watergate!)

In fusion reactions neutrons are “nasty”. They are very hard to contain and make other materials radioactive on collision. The first generation fuels of Deuterium and Tritium (reactions 1 and 2 below) produce many neutrons. A second generation with Deuterium and 3He only produces a few. A 3He – 3He reaction would produce none.

Kulcinski: Fusion Energy could provide that new energy source in the middle of the 21st Century. ….. However, ……  the DT Tokamak does not appear to be the ultimate answer. The problem lies in both the DT fuel cycle, which emits 80% of its energy in highly damaging and radioisotope producing neutrons, and in the complex design of the Tokamak.

fusion reactions after Kulcinski

fusion reactions after Kulcinski

But the promise of having 3He available to produce power is immense.

(more…)

Adapting to climate change requires the further development and use of fossil fuels

July 31, 2014

The single thing that differentiates the human species from every other known species on earth has been the control and use of fire.The step change then from primitive to modern humans has been due not least to the control and development of the combustion process and the utilisation of fossil fuels. This in turn has multiplied many times the intensity of energy available to be harnessed by man. I would suggest that the human capability of handling change is largely a function of the power intensity available.

power intensity

power intensity

Fossil fuels have been demonised (by association with carbon dioxide emissions) for the last 30 years. In spite of that most  of the growth in the developing world has been – and continues to be – powered by fossil fuels. Fortunately the lack of evidence of any significant linkage between man-made carbon dioxide and global warming  (which is still the politically correct ideology) is beginning to be realised. The unnecessary, misplaced and ineffective increase of electricity prices in countries which have curtailed their use of fossil fuels has prolonged the recession and has cost many millions of jobs.

We have now had almost 20 years with the highest level ever of fossil fuel utilisation but “global temperature” has remained stubbornly static. In the last decade global temperatures have declined slightly. The hypothesised link between man-made carbon dioxide (which constitutes only about 3% of carbon dioxide emissions) and global temperature is well and truly broken. All the various climate computer models – which build on this link being amplified – have failed miserably.

The indicators of a global cooling cycle having started are piling up.

  1. There is more ice in the antarctic than has ever been measured
  2. There is more ice in the arctic than about a decade ago
  3. Total ice cover is higher now than has ever been measured
  4. Ice cover on the Great Lakes reached levels not seen for over 50 years and has persisted into the spring (even summer) later than has been observed for at least 40 years.
  5. The expected super El Nino forecast for this year has been dampened by a cooling Pacific and only a mild El Nino event – if at all – is now to be expected
  6. Sea level rises are no different to the long term average for sea level recovery since the last glacial minimum and may even have slowed.
  7. The deep oceans are cooling and are no repository of “hidden heat”
  8. The net cooling effect of clouds has been underestimated in nearly all models and cloud cover over the world is increasing (slightly).
  9. Man made water vapour is of greater significance than man made carbon dioxide for climate effects. But man made water vapour is almost insignificant compared to the water vapour flux due to evaporation and respiration.
  10. Solar effects are virtually ignored by all climate models but the sun does not much care for models and is reaching a low level of activity comparable to the Dalton or Maunder Minima.

Crying wolf about global warming has been the politically correct thing to do for 3 decades. Before that it was politically correct to be alarmist about the coming ice age. No doubt all the old fears about an ice age can be dusted off and recycled.

Climate change has been the most powerful force which has shaped human evolution and expansion. Sea level changes and patterns of precipitation and desertification have driven both evolution and migrations. Sea level during an ice age is about 120 m lower than it is today. More land is exposed in equatorial and tropical regions during a glacial period while land is rendered uninhabitable by the ice sheets of the north. But even primitive humanity survived during the glacials.

It is the global cooling cycles and not global warming cycles which will place the greatest demands on farming and energy. The greatest sea level change that humanity has had to – and will have to – adapt to  is the 120 m difference between glacial and interglacial conditions. During an ice age precipitation will drop sharply and river water flows will decline. Hydro power will all but dry up. It is the inevitable coming of the next ice age that will pose the real challenge – not the 1 m sea level rise that may come with another warming cycle. And when the ice age comes again it will be fossil fuels which will keep the home fires burning. It is the further exploitation of nuclear energy and fossil fuels in all its forms – coal, oil, natural gas, shale gas, gas from methane hydrates – that will be needed. It is the availability of power at the intensities provided by nuclear power and fossil fuel combustion which is what will provide humans with the wherewithal to cope with climate change, whether warming or cooling, but especially when the next ice age begins.

Whatever the alarmists would have us do in the short term, reality will eventually bite. The use of fossil fuels will – thankfully – continue as will the exploration for new sources of gas. The next generation of nuclear power plant will be developed – even though nuclear alarmism has led to a dearth of nuclear engineers. No doubt some market niches will be filled by wind and solar power but that will not be very significant in the large picture.

 

The end of the road for the large Alstom gas turbines?

July 7, 2014

The large (>50MW) Alstom gas turbines (GT11N2, GT13E2, GT24 and GT26) represent a line of technology which derives mainly from the BBC range of products (developed further as ABB) and acquired by Alstom in 1999. At that time Alstom’s licence with GE came to an end. But as GEC-Alsthom, Alstom had also inherited the gas turbine technology which came out of GEC in the UK. In the current Alstom range not much remains of the GEC tradition. At the smaller end Alstom also once had the gas turbine technology of the Ruston engines from Lincoln and acquired the ABB range of small machines (which themselves carried forward the developments as ASEA and some of the Sulzer range). But the entire range of industrial (<50MW) gas turbines was divested to Siemens in 2003 (and they are doing very well there).

Now as GE takes over Alstom’s power business (which has still to get final regulatory approval but looks to be a done deal), the days of the Alstom range of large gas turbines are strictly numbered. GE (and Siemens) have their own machines competing directly with the GT24 (60Hz) and GT26 (50Hz) and I do not expect that any more of these machines will ever be sold again. The sequential combustion design concept that these machines employ is so far from the GE approach that it seems impossible for any versions of these machines to continue. Alstom (as ABB) had adopted sequential combustion in the late 1990’s firstly to differentiate themselves from GE and Siemens and to get over their lack of access to advanced, high-temperature materials coming out of military jet engine programmes. Sequential combustion was first used/tested by BBC in the 1960’s 1948* though at much lower temperatures and ABB was trying to create a virtue out of a disadvantage – which the GT24 and GT26 did eventually do, but not without great problems and great cost.

GE may well have some benefit from some of the component solutions that Alstom has been forced to develop – at great expense – to get over the challenges posed by sequential combustion. Similarly some of the low-NOx solutions developed by Alstom could possibly be of use for GE. There may be some tricks for GE to pick-up regarding compressors. Certainly GE will continue with the very lucrative service market in maintaining the Alstom fleet and this will continue for perhaps 10 or 12 years at most. So while GE will benefit from the service revenue and by the reach of Alstom’s global sales organisation, the GT24 and GT26 – as products – have very little benefit to offer. It will not be possible for GE to absorb all the manpower currently employed with Alstom’s gas turbines. Not all those currently involved with the design and manufacture of the GT24 and GT26 will be needed for – or be able to switch over to – the design and manufacture of the GE range. GE’s global procurement network and its qualification of sub-suppliers is probably much more advanced than Alstom’s. I don’t expect that GE’s global sourcing will be much enhanced by the acquisition of Alstom’s Power business. Some job losses at Alstom locations are inevitable and I suspect these will be mainly in Switzerland while jobs in France will be somewhat protected by GE’s promises to the French government. At Belfort, Alstom produced GE machines under licence till 1999 and no doubt this will become GE’s centre for large gas turbines in Europe.

The GT11N2 gas turbine will probably die a natural death. It has not been a really competitive machine for over a decade and even though it has gone through many upgrades and cost reduction exercises, I do not think it offers GE any great advantages and they already have competing machines. The GT11N2 may have survived a little longer within the more restricted Siemens stable but even here it would have eventually withered.

The GT13E2 is possibly the only machine that may survive for a while under GE. It has some unique advantages with low-Btu fuels and could have a geographical market niche in Russia and the former CIS countries. But if it does survive it will do so only as a niche product. Again it would probably have had a longer life under Siemens but my guess is that it will not be sold for more than another 2 or 3 years.

The next market boom for large gas turbines – by my analysis – will come in the second half of 2015. This will be due partly to the 7-8 year “normal” business cycle and partly due to, and reinforced by, the advent of shale gas. And when that boom comes, the Alstom machines will be absent and there will be one less gas turbine technology available in the world. GE, Siemens and MHI will be the only three technologies left and they will be the main beneficiaries. But just three technologies are not enough. A growing market together with a dearth of technology suppliers will probably ensure the entry of another player into the field of large gas turbines.

(Actually Siemens and MHI get the best return at the lowest cost. They gain increased market space as Alstom’s machines disappear at no cost to themselves. GE gains no new products, gets the same increased market space and gets increased service revenue for Alstom machines. But GE has a large cost of acquisition and a great deal of hassle – and cost – to come as they restructure and integrate the Alstom business).

I would guess that this fourth player could well be Shanghai Electric with their newly acquired 40% stake in Ansaldo Energia. This has been something of a coup for Shanghai Electric. Doosan were also eyeing Ansaldo as a way of entering the gas turbine playing field (the entry barriers are too high for a scratch player). Both Doosan and Siemens had made bids for Ansaldo Energia but Siemens’ bid was essentially a defensive and a spoiling bid and they eventually withdrew. Doosan were the sole remaining bidder but it seems that Shanghai have pipped them at the post for this strategic acquisition.

* Correction – Sequential combustion was first used by BBC at Beznau in 1948, operating on distillate and with a TIT of 575ºC.

Fossil fuel combustion at an all time high (but global warming is absent)

June 18, 2014

The BP Statistical Review of World Energy 2014 is now out and the consumption of all fossil fuels has never been higher. Coal and gas consumption are particularly strong. And – even though many are in a state of denial about it – global warming has come to a stop over the last 18 years. In the last 10 years global temperatures show a slight downward trend.

There seems to be no purpose to the demonisation of fossil fuels other than for pandering to the religion of global warming. Consider the last 25 years. (I use 1988 as a reference point not only because 25 years should be enough to see some trends but also because the BP data is readily available from that date). During this 25 year period gas consumption has increased by over 80%, coal consumption by 0ver 70% and oil consumption by over 30%. The increased global coal burn since about 1999 is particularly striking. In the same 25 year period the carbon dioxide concentration in the atmosphere has increased from about 355 ppm(v/v) to about 395 ppm(v/v) – a rise of about 11%. And global temperatures have not increased at all for almost 2 decades.

Climate policy is policy without any objectives and without any means of checking any achievements. What exactly could we achieve by not using fossil fuels?

There is not a single climate policy proposed by the IPCC or by any government in the world  which has a definable and measurable climate benefit.

25 years of fossil fuel consumption

25 years of fossil fuel consumption

The global warming hiatus now extends to at least 18 years.

Global warming has gone missing

  • The RSS satellite dataset shows no global warming at all for 213 months from August 1996 to April 2014. That is more than half the entire 423-month satellite record.
  • The fastest centennial warming rate was in Central England from 1663-1762, at 0.9 Cº per century – before the industrial revolution began. It cannot have been our fault.
  • The global warming trend since 1900 is equivalent to 0.8 Cº per century. This is well within natural variability and may not have much to do with us.

Huge shale deposits confirmed in the South of England

May 23, 2014
Map of the Weald Basin

Shale deposits in South of England and Wales (BBC)

The British Geological Survey (BGS) has now confirmed the huge deposits of oil bearing shale in the South of England . Ironically this comes just days after the BBC also reported on the idiot report by the self-styled Global Sustainability Institute that the UK would run out of oil, coal and gas in 5 years!!!

BBC (23rd May)The BBC’s John Moylan said that although the BGS study will say that there are several billion barrels of oil in place, is not clear how much would be economically recoverable. ….. By way of comparison, the equivalent of around 45 billion barrels of oil has been extracted from the North Sea over the past 40 years.

Last year, a BGS study of the North of England suggested there could be as much as 1,300 trillion cubic feet of gas contained in shale rocks. ….

Andrew Austin, chief executive of the onshore energy IGAS, said it had long been known that southern England had extensive resources.

He told the BBC: “We’ve known that there’s a big potential for oil and gas explorations across the country but particularly in terms of oil in the Weald Basin which is the area that stretches roughly from Winchester across towards Gatwick, up to the M25 and down to the coast at Chichester.

“There’s been a long history of oil and gas exploration in this area. We as a company produce oil and gas from around 20 sites across that area. Around 40 million barrels have been recovered from that area to date.”

In the US, fracking for oil and gas has created an energy boom and led to speculation that the country could overtake Saudi Arabia as the world’s biggest producer by 2020, or even sooner.

Gas prices in the US have fallen sharply as a result, and other countries are now hoping that shale oil and gas could also lead to lower domestic energy prices.

And just a few days ago the BBC chose to present this nonsense.

BBC (16th May)In just over five years Britain will have run out of oil, coal and gas, researchers have warned. …… There should be a “Europe-wide drive” towards wind, tidal, solar and other sources of renewable power, the institute’s Prof Victor Anderson said. ….

……. Professor Anderson said: “Coal, oil and gas resources in Europe are running down and we need alternatives.

“The UK urgently needs to be part of a Europe-wide drive to expand renewable energy sources such as wave, wind, tidal, and solar power.”

However, Jim Skea, Research Councils fellow in UK Energy Strategy. cast doubt on the findings of the report.

He told BBC News: “This sounds very unlikely. What’s more, it’s irrelevant – the UK has a stable supply of imported energy, even if it is a good idea to increase our own supplies.”

The government recently announced it was cutting subsidies for large-scale solar energy and the Conservatives have said there will be no funding for new onshore wind farms if they win the next election.

Ministers are hoping that enough shale gas – extracted by fracking – will be obtained to make a difference, the BBC’s environment analyst Roger Harrabin says.

Professor Victor Anderson is an alarmist economist who used to work for the World Wildlife Fund. But to develop a catastrophe theory and predict that the UK will run out coal, oil and gas in 5 years is just stupidity.

Prior to taking up his current position Professor Anderson had worked as Senior Policy Officer for One Planet Economy at WWF-UK, a Lecturer at Goldsmith’s College, London University, an Economist at the Sustainable Development Commission, a Senior Parliamentary Researcher at Plaid Cymru Group of MPs, Board Member at London Development Agency and an elected Assembly Member at the Greater London Authority. He is also currently a Member of the Planetary Boundaries Initiative Advisory Group.

Japan to help Eastern Europe to shift from gas to coal

April 29, 2014

A return to coal as reality bites. It is now a “good thing” to help Eastern Europe to shift from Russian gas to their own coal.

Perhaps it is beginning to sink in that while carbon dioxide emissions have increased substantially in the last 20 years there has been no impact on global temperature. There is just no direct evidence that man-made carbon dioxide emissions have any significant impact on global temperature or on climate. The entire edifice of climate politics is built on this one unproven – and now broken – assumption. Take away this single assumption and all of climate politics collapses in a sorry heap.

Yomiuri Shimbun:

The government plans to support Ukraine and other Eastern European nations in the construction of next-generation coal-fired power plants that can generate power with less fuel, according to informed sources.

Under the initiative, Japan would stand behind the nations’ efforts to use coal—abundant in Eastern Europe—instead of natural gas, the supply of which makes them dependent on Russia. The government is expected to announce the initiative at the meeting of energy ministers from Japan and other Group of Seven industrialized nations to be held in Rome from May 5.

Japan’s support will involve the construction of coal-fired power plants using technologies known as supercritical steam pressure and ultra supercritical pressure to spin the turbines, enabling these nations to obtain electricity while using less fuel and emitting less carbon dioxide.

With a power generation efficiency of 40 percent to 43 percent, Japan has the world’s most advanced technologies in this field. About one-fourth of the coal-fired power plants in the nation use these technologies.

In comparison, Germany has a power generation efficiency of about 38 percent, while the corresponding figures for Ukraine and other Eastern European nations apparently remain at the 30 percent levels. 

If an agreement is reached with Ukraine, Japan will support a feasibility study to rebuild power plants during the current fiscal year. Under the initiative, Japan will provide yen loans to cover several tens of billions of yen in construction costs in addition to its energy-saving technologies, while Ukraine will provide emission quotas for greenhouse gases to Japan under their bilateral framework.

The G-7 meeting of energy ministers will discuss policies to raise the energy self-sufficiency rates of Ukraine and other European nations, as well as diversifying their energy supplies with one goal in mind: lowering their dependency on natural gas and oil from Russia.

 Ukraine imports 60 percent of the natural gas it uses from Russia, while the three Baltic nations and Eastern European nations buy from 60 percent to 100 percent of their natural gas from that country—a situation that makes it difficult to shift away from their reliance on Russia.

Though they have a dearth of natural gas, Eastern European nations have rich reserves of coal, with Ukraine being almost self-sufficient in that resource. Introduction of the next-generation coal-fired power plants is likely to improve their energy self-sufficiency rates, the sources said.

Going nuclear for a nanowatt battery life of 20+ years

February 28, 2014

Tritium batteries are now available commercially and can have a life exceeding 20 years (Tritium has a half-life of 12.3 years). These thumb-size batteries can produce enough nanowatt (1 nW = 10−9 watt) power to keep micro-electronics going. An 8-bit PIC microcontroller chip when in “sleep” mode consumes around 10 nW. The cost is still in thousands of Dollars but should come down fast. It appears that they could be scaled up to the microwatt (1 µW = 10−6 watt) range which would be enough to power a wristwatch.

Commercial nanoTritium battery by City Labs

Commercial nanoTritium battery by City Labs

Tritium (symbol T or 3H, also known as hydrogen-3) is a radioactive isotope of hydrogen. The nucleusof tritium (sometimes called a triton) contains one proton and two neutrons, whereas the nucleus of protium (by far the most abundant hydrogen isotope) contains one proton and no neutrons. Naturally occurring tritium is extremely rare on Earth, where trace amounts are formed by the interaction of the atmosphere with cosmic rays. The name of this isotope is formed from the Greek word “tritos” meaning “third”.

Tritium is produced in nuclear reactors by neutron activation of lithium-6. This is possible with neutrons of any energy, and is an exothermic reaction yielding 4.8 MeV. In comparison, the fusion of deuterium with tritium releases about 17.6 MeV of energy. High-energy neutrons can also produce tritium from lithium-7 in an endothermic reaction, consuming 2.466 MeV. This was discovered when the 1954 Castle Bravo nuclear test produced an unexpectedly high yield.

Gizmag reports:

(Tritium) although occurring naturally in the upper atmosphere, it’s also produced commercially in nuclear reactors and used in such self-luminescent products as aircraft dials, gauges, luminous paints, exit signs in buildings and wristwatches. It’s also considered a relatively benign betavoltaic, providing a continuous flow of low-powered electrons for a good many years.

According to the Environmental Protection Agency, tritium has a half-life of 12.3 years and the Model P100a NanoTritium betavoltaic power source from Toronto’s City Labs is claimed to be capable of providing juice to low-power micro-electronic and sensor applications for over 20 years. It’s described as robust and hermetically sealed, and the tritium is incorporated in solid form.

Independent testing undertaken by Lockheed Martin during an industry-wide survey also found the technology to be resistant to broad temperature extremes (-50° C to 150° C/-58° F to 302° F), as well as extreme vibration and altitude.

Examples of possible applications for the technology offered by City Labs include environmental pressure/temperature sensors, intelligence sensors, medical implants, trickle charging lithium batteries, semi-passive and active RFID tags, deep space probes, silicon clocks, SRAM memory backup, deep-sea oil well electronics, and lower power processors.

It is still a long way from microwatts to the kilowatts needed to power a home or to drive electric vehicles and the Megawatts needed for small scale power generation. Central power generation requires Gigawatts.

It is easier to convert nuclear radiation into heat and only some materials are betavoltaics which generate current. If only all low-grade radioactive waste from nuclear plants could be converted into batteries! Perhaps nuclear batteries are the breakthrough that electric cars are waiting for!! With current battery technology they are not going anywhere very fast.

Queensland switches back to coal

February 5, 2014

Once upon a time Australia had among the lowest electricity costs in the world but that was in the days where the market was not distorted by carbon taxes, mandatory renewable energy targets and subsidies for solar power. Coal prices are declining while gas prives are rising. This from The Australian as Queensland goes the way of Germany:

QUEENSLAND’S largest power generator will today declare that Australia is one of the world’s most expensive countries for energy and warn that the electricity market is being distorted by the carbon tax, mandatory renewables target and solar-rooftop subsidies.

After Stanwell took the extraordinary step yesterday of announcing it would mothball its biggest gas-fired power station and resurrect a coal facility built in the 1980s – sparking predictions that gas-fired power plants would be withdrawn in other states – it will today call for a scaling back of the renewable energy target.

Before the introduction of the carbon tax, the RET scheme and solar feed-in tariffs, the abundance of coal had made Australia a source of low-cost electricity, the company will say. “These policies appear to have been implemented for ideological reasons with little analysis of the impact on electricity prices and economic growth,” Stanwell chief executive officer Richard Van Breda will say.

Stanwell will issue its warnings as part of its submission to the federal government’s energy white paper, being developed by Industry Minister Ian Macfarlane.

The submission will caution that a raft of energy policies is eroding Australia’s competitiveness in manufacturing, which is a sensitive issue for the government amid internal tensions over taxpayer handouts to businesses, including SPC Ardmona.

Yesterday, Stanwell revealed it would withdraw its Swanbank E power station, near Ipswich west of Brisbane, from service for up to three years from October so it could sell the gas rather than use it in electricity generation. …….. A unit at the Tarong coal power station – in cold storage since late 2012 – will be returned to service later this year.

….. Germany is shifting back to more coal-fired electricity generation, reopening some of its dirtiest brown-coalmines that have been closed since reunification, despite having spearheaded Europe’s push into renewable energy. China has plans to add another 860 million tonnes of coal production by 2015. ………  

Stanwell’s energy white paper submission will raise concerns that the surge in rooftop solar panels has increased the capacity of the market, making cheaper coal-fired power stations run less efficiently. It says solar feed-in tariffs (state government schemes) have resulted in high ongoing costs for network infrastructure. …

 

The EU’s green sickness: Competitiveness and shale gas at Davos

January 28, 2014

It is my contention that the spread of perverse “Green” energy policies in Europe are partly responsible if not for the financial crisis itself, certainly for its prolongation and for slowing down the recovery. It is also my contention that it is the deadening and oppresive inertia that is represented by the “obese” and self-preserving nature of the EU bureaucracy in Brussels which has prevented individual countries in Europe from taking fast corrective actions when needed.

It is now energy costs for industry (and not just labour policies) which is increasing the competitiveness divide between Europe and the US. It seems that this competitiveness – or lack of it – was of some passing interest at Davos:

CNBC

One of the biggest themes at Davos this year — and one that was not there last year — was “competitiveness.” You encountered it whether in the public sessions in the Congress Center, or in the private sessions, and at the various dinners in the hotels strung along the Davos Platz.

This particular rivalry pits the United States head-on against Europe. And, no question — at Davos this year, the United States was judged the clear winner, much to the dispirit of the Europeans trudging back along the icy, snowy streets of this mountain village.

Of course, competitiveness among nations gets measured in many different ways. …… But this year at Davos, it was calibrated along only one axis — energy. And that measure is creating great angst for European industry. …… It all comes down to shale gas and the energy revolution it has triggered in the United States. As a result of the rapid advance of shale technology, the United States now has an abundance of low-cost natural gas — at one-third the price of European gas. European industrial electricity prices are twice as high as those in some countries and are much higher than those in the United States. To a significant degree, this is the result of a pell-mell push toward high-cost renewable electricity (wind and solar), which is imposing heavy costs on consumers and generating large fiscal burdens for governments. In Germany, it was further accentuated by the premature shutdown of its existing nuclear industry after the 2011 Fukushima nuclear accident in Japan. 

All this puts European industrial production at a heavy cost disadvantage against the United States. The result is a migration of industrial investment from Europe to the United States — what one CEO called an “exodus.” It involves, not only energy-intensive industries like chemicals and metals, but also companies in the supply chains that support such industries. …….. a senior European official declared that Europe needs to wake up to the “strategic reality” that shale gas in the United States is a “total game changer.” Without a change in policies at both the European and national levels, he warned, Europe “will lose our energy intensive industries — and we will lose our economy long term.” ……..

And the first signs of a potential change of policy abruptly emerged in both Brussels and Berlin during Davos week. European policy makers, struggling with already high unemployment, have begun to visualize the further job loss that will result from shutting down European plants. They have also started to pay attention to the 2.1 million jobs in in the United States supported by the unconventional oil and gas revolution.

In Brussels, coinciding with the first day of Davos, the European Commission released a new policy paper on energy and climate. It reiterated the commitment to substantial growth in renewable electricity and a “low-carbon economy.” But, for the first time, it put heavy emphasis on the price of such policies and called for a “more cost-efficient approach” to renewables. ….. Despite the fervent opposition to shale gas in some quarters in Europe, it pointedly included shale gas as among the domestic low-carbon energy sources that member countries can pursue.

……… A similar message resounded at exactly the same time from Berlin. Sigmar Gabriel, the social democratic minister of economy and energy in Germany’s coalition government, called for reform in Germany’s Energiewende — or “energy turn” policy — which has heavily subsidized the rapid growth in renewable electricity. He warned that the “anarchy” in renewable energy and its costs in Germany had to be reined in. ……… Up until now, the Energiewende in its present form has been sacrosanct, supported not just by the Greens but all across the political spectrum. Gabriel — and Chancellor Angela Merkel — aim to maintain the commitment, but reduce subsidies, focus more on costs, and, as Gabriel said, “control the expansion of renewable energy.”

His comments reflect the recognition that, if the course remains unchanged, Germany could be facing what Gabriel called “a dramatic deindustrialization.” ………. Exports are responsible for over 50 percent of German GDP, compared to 27 percent for China, which is generally considered to be the workshop of the world.

Gabriel’s comments stirred up criticism from environmentalists; indeed, they may seem strange words coming from the leader of the Social Democrats (the SPD). But the Social Democrats are very close to the trade unions, for which loss of competitiveness translates into loss of jobs.

In 2 decades of green profligacy, I estimate the “jobs lost” by the ” growth prevented” to be around 17 million just within the EU.


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