2008 WRAP UP – MOST IMPORTANT POSTS OF THE YEAR, PART 1 (SOLAR CAN BE 10%, PICKENS HAS GOOD AND BAD, EUROPE WILL GET SUPERGRID)

Today NewEnergyNews features its picks for 2008’s 3rd, 4th and 5th most important posts. (Numbers 1 & 2 will come tomorrow.)

In 2008's "Most Important Post" #5, IT’S FOR SUN, IT’S FOR WIND, IT’S SUPERGRID!, the announcement of the long-discussed and yet-to-be-built European Supergrid that will link the entire continent's power supply and create pathways for the delivery of Middle East and North African solar energy-generated electricity to EU nations was reported. The announcement of its actual operation will no doubt be the most important story of whatever year that comes in. More below.

Ever since T. Boone Pickens kicked off a nearly $60 million public relations campaign to sell his Pickens Plan promoting wind power and natural gas, the media has been fawning. 2008's "Most Important Post" #4, TOP SCIENTIST NOTES BIG GOOD, BIG BAD IN THE PICKENS PLAN, reported on the authoritative conclusions of a U.S. Department of Energy-affiliated scientist who saw both good and bad in the plan.

Early in the summer the sun shone forth when SOLAR CAN BE 10% OF U.S. ELECTRICITY BY 2025, 2008's "Most Important Post" #3, reported on Clean Edge’s Utility Solar Assessment Study finding feasible the still-not-mature technology’s ability to provide 10% of U.S. electricity by 2025. Though 10% is little more than a hint of solar energy’s real potential, the report is its biggest news to date.

Despite the financial crisis, all these big plans continue to move forward, promising much more New Energy excitement in coming years.


2008 "Most Important Post" #3: SOLAR CAN BE 10% OF U.S. ELECTRICITY BY 2025

Originally posted June 23: Naming utilities, solar energy industry professionals and power system regulators as the key players, a new report from Clean Edge and Co-op America identifies roles for each in making solar energy 10% of U.S. power over the next 2 decades.

Utilities must begin by incorporating solar energy as a way to smooth peak demand, include it into all smart grid renovations and develop business models that incorporate it.

The solar energy industry must bring costs down ($3/watt, peak) and make solar an easy, plug-and-play “appliance.”

Regulators/policy makers must establish predictable, long-term incentives (investment and production tax credits), create open standards for interconnection and give utilities the right to incorporate solar into their base generation at "base" rates.

The report predicts 8% will come from distributed PV systems and 2% from solar power plants.

Must happen: (1)Economies of scale drive solar power costs down 18% every time global capacity doubles; (2) the rising cost of greenhouse gas emissions drives fossil fuel prices up 3%/year.

Most of the 10% achievement will come after 2015 when solar will still be 1% of U.S. generation but when solar energy-generated electricity will become price competitive with the traditional fossil fuels serving the grid.

Costs to achieve 10% by 2025: $450 billion to $560 billion, an average of $26 billion to $33 billion/year. Too expensive? Absolutely NOT. Utilities spent ~$70 billion on new power plants, transmission and distribution systems in 2007.

The Full Report: Utiltity Solar Assessment (USA) Study; Reaching Ten Percent Solar By 2025

(From Clean Edge - click to enlarge)

Utility Solar Assessment (USA) Study
June 17, 2008 (Clean Edge)
and
Solar energy cost may rival other forms soon, study says; Sun-generated power may be 10% of U.S. use by 2025
Matt Nauman, June 18, 2008 (San Jose Mercury News)

WHO
Clean Edge (Ron Pernick, managing director/co-author; Clint Wilder, contributing editor/ co-author); Co-op America; utilities, solar energy industry professionals, and power system regulators;

WHAT
Utiltity Solar Assessment (USA) Study; Reaching Ten Percent Solar By 2025 offers an informed roadmap to utilities, the solar energy industry, and power system regulators for obtaining 10% of U.S. power from solar energy by 2025.

(From Clean Edge - click to enlarge)

WHEN
- 2015: A broad consensus of energy experts expects solar energy to achieve price parity with traditional sources of electric power.
- 2018: The report calls for soalr energy price to be at least down to $3/watt, peak.
- 2025: Solar energy could provide 10% of U.SD. electricity.
- Solar costs (averaged):
(1) Present - $5.50 to $7.00/watt, peak/15-32 cents kWh
(2) 2015 - $3.02 to $3.82 watt, peak/8-18 cents kWh
(3) 2025 - $1.43 to $1.82 watt, peak/4-8 cents kWh

WHERE
- U.S. solar capacity (0.1% of U.S. power) presently lags far behind Japan, Germany and Spain because those countries have had reliable, long-term federal incentives.
- U.S. southwestern desert areas are widely assessed to have insolation enough to power the entire country if solar power plants, storage capacity and transmission were available.
- Study based on interviews with 30+ experts and proprietary Clean Edge data (on solar PV market size, cost/price history/projections, other market factors).

WHY
- The report describes utilities, the solar energy industry and power system regulators as the 3 key actors in achieving increased solar energy generation on the U.S. grid.
- Grid parity by 2015 is based on 2 strong points: Decreasing solar costs due to economies of scale and increasing costs for traditional fossil fuels due to a rising cost for greenhouse gas emissions.
- Advantages of solar energy: distributed generation less vulnerable to grid failures and central outages, quickly constructed, low maintenance installations, zero raw materials costs and zero emissions operation.

(From Clean Edge - click to enlarge)

QUOTES
- Clean Edge: “In just the past year, a number of utilities and solar companies have announced aggressive programs to deploy large-scale solar power projects, including Southern California Edison's plan to install 250 megawatts of distributed solar PV, Duke Energy's stated goal of investing $100 million in rooftop solar, and Pacific Gas & Electric's announcements to invest in thousands of megawatts of concentrating solar power in California's deserts…solar could become "ubiquitous" as with earlier semiconductor-based revolutions.
- Alisa Gravitz, executive director, Co-op America: "Solar prices are falling as the solar industry scales…For the first time in history, cost-competitive solar power is now within the planning horizon of every utility…We are seeing the turning point for solar…This isn't a forecast; it's a fact."


2008 "Most Important Post" #4: TOP SCIENTIST NOTES BIG GOOD, BIG BAD IN THE PICKENS PLAN

Originally posted September 9: Energy entrepreneur T. Boone Pickens’ energy plan, the one that has become a regular feature of TV’s commercial breaks this summer, proposes to end the U.S. addiction to oil. NewEnergyNews recently obtained a PowerPoint presentation from Brent P. Nelson, a veteran U.S. scientist in a top position at one of the Department of Energy (DOE)’s most important research laboratories, assessing the Pickens Plan.

Nelson, who confidentially released the assessment on the condition it is understood to be his own expert opinion and not the official position of his therefore unnamed DOE lab, finds great benefit and great danger in Pickens’ proposals.

The Pickens Plan has 2 parts, each involving a separate energy source. It would use wind energy as 20% of U.S. electricity and shift the natural gas the U.S. now uses for electricity to fuel compressed natural gas (CNG) vehicles.

The summary of the good points Nelson sees in the Pickens Plan: (1) Investing in the development of wind energy, (2) reducing the use of natural gas to generate electricity, (3) the acknowledgement by an oil man that “we can’t drill our way out,” and (4) the need for a U.S. national energy plan.

The summary of the problems he has with it: (1) Using natural gas for transportation, (2) substituting drilling for oil with drilling for gas, and (3) using natural gas for transportation.

The first lines NewEnergyNews posted about the plan were these, on July 12:

“Here’s the thing: Oil explorer and corporate entrepreneur T. Boone Pickens is pointing in the right direction. He’s shaken a lot of oil industry fossil fools mired in 1950s thinking. He sees clearly what’s happening in wind and he’s all over it.

“He’s had this obsession with Compressed Natural Gas cars for years and it still doesn’t seem like it’s going to work out. Natural gas and liquified natural gas (LNG) are more likely to be a bridge to an electric grid powered by New Energies from the wind, the sun and the ocean. Transportation is more likely to transition from nonfood crop- and algae-biofuels and plug-in hybrids to all electric vehicles.

”But Pickens deserves a lot of credit for stimulating debate. He got more people talking about New Energy in conservative, fossil fuel-oriented corners of the media world than anybody has since Al Gore.”

Nelson’s take on Pickens’ plan differs primarily from NewEnergyNews' take in that he has run the numbers and sees a coming peak gas crisis that could be as dire and economically burdensome for the nation as the peak oil crisis the U.S. is passing through right now.

Nelson: “Natural gas is our next crisis…we’ve already used ~1/2 of our domestic gas…”

Nelson points out the unique value natural gas has as a heating fuel: “No other fuel can heat your home as cleanly or efficiently!!!” Using it as a vehicle fuel is squandering a dwindling resource that is “…precious for our children and grandchildren.”

Like NewEnergyNews, Nelson sees the future of transportation coming from electric vehicles and sees the dwindling natural gas supplies as too precious to be squandered on electricity generation or transportation: “Natural gas, as a space-heating fuel, has almost no alternatives…”

Because of his sense of urgency about the need to preserve natural gas supplies, Nelson describes the natural gas dimension of Pickens’ plan as "immoral."

As the election season gathers momentum and the fall TV viewing season arrives, it may be hard to distinguish among the kinds of immorality trumpeted during the commercial breaks that shoulder aside T. Boone's diatribes. Nelson's conclusions about the Pickens Plan are worth keeping in mind. They show how a TV spot or an energy plan can have both some truth and something more insidious.

The Pickens Plan (click to enlarge)

Why T. Boone Pickens’ Energy Plan Is Seriously Flawed
Brent P. Nelson, August 6, 2008 (PowerPoint Presentation)

WHO
Brent P. Nelson, veteran research scientist, top national laboratory; T. Boone Pickens, energy entrepreneur/author, The Pickens Plan; The U.S. Department of Energy (DOE)

WHAT
Nelson offers a unique and powerful assessment of what is good and what is bad about Boone Pickens’ widely heralded plan to (1) develop the wind energy resources of the Midwest to power the national electricity grid and (2) use U.S. natural gas resources as compressed natural gas (CNG) fuel for vehicles to (3) displace dependence on oil imports.

From Nelson.

WHEN
- Pickens debuted his plan with much fanfare in July and continues to use his considerable wealth for media time to push his ideas to the public.
- Nelson created his PowerPoint assessment of the Pickens Plan in August and it has just been passed to NewEnergyNews.
- A DOE study released in Spring 2008 affirmed the practicality of the U.S. wind energy industry’s announced plan to provide 20% of U.S. electricity by 2030.

WHERE
- U.S.: Now obtains 1-to-2% of its electricity from wind energy.
- U.S.: Now has approximately 150,000 CNG-fueled vehicles.
- World: Now has 7-to-8 million CNG-fueled vehicles.

WHY
- Pickens’ premises are that the U.S. spends $700 billion yearly to import oil, wind could replace most of the natural gas used to generate electricity and that gas could be used as CNG to fuel U.S. vehicles.
- U.S. natural gas supplies: 20.5% to residential heating, 13.0% to commercial heating, 28.8% to industrial uses, 29.8% to electricity generation, 7.8% to gas fuels and 0.1% to fuel vehicles.
- In the less hopeful evaluations, the U.S. may have only 23 years of natural gas reserves remaining. In the most optimistic evaluations, there could be almost a half-century of reserves (which is no volume on which to base an energy plan).
- By Nelson's calculations, natural gas as source of supply for the electrical grid can be considered little more than a bridge to New Energy.
- Carl Pope, veteran environmentalist and Executive Director of the Sierra Club, recently suggested CNG might be an interim solution for truck fuel.

From Nelson. (click to enlarge)

QUOTES
- Nelson, on why Pickens’ plan for the use of U.S. natural gas resources is “immoral”: “(1) Steals this precious and unique resource from future generations. (2) Accelerates our impending gas energy crisis. (3) Replaces our dependence on foreign oil with a dependence on foreign natural gas. (4) Delays our needed transition to transportation technologies not using liquid-fuels for moving people on the ground.”
- Nelson’s “more rational plan”: “Decrease fossil fuels” and “Increase renewables: solar, wind, biodiesel, etc. and develop electric transportation”


2008 "Most Important Post" #5: IT’S FOR SUN, IT’S FOR WIND, IT’S SUPERGRID!

Originally posted November 16: The European Supergrid, long debated by the European Union states, was formally proposed – a day before an EU summit meeting with Russia in France, a reopening of talks on economic and energy cooperation. Coincidental timing?

In the August confrontation over Georgia, the Russian Bear showed it will not hesitate to bare its teeth and claws when it wants dominance. Long uneasy with their dependence on Russia and the Middle East for the natural gas they use to power their grids, EU nations now see clearly they, too, can no longer hesitate but must lay plans to free themselves.

Supergrid will maximize the EU’s capability of drawing on its own and non-Russian power sources. It starts with 3 steps: (1) Connect the power generation of the wind-rich North Sea and Baltic Sea regions; (2)Link grids in the Mediterranean region in preparation for shifting supplies from the wind-rich areas as well as, eventually, from the sun-rich areas of North Africa and the Middle East; (3) Develop new pipelines to bring in natural gas from the Caspian region (without transiting Russia) and Africa.

The world's present economic circumstances make development of Supergrid less urgent because Russia needs so badly to sell its natural gas resources right now it is unlikely to use them as leverage in any strategic geopolitical gambit. On the other hand, present economic circumstances make the expansion of energy transmission infrastructure an ideal stimulus undertaking for the EU.

The EU commitment to Supergrid is also good news for New Energy developers. Aside from relieving reliance on Russia for energy, the capacity to move wind- (or sun-)generated electricity around the continent means larger volumes can be delivered from where the wind is blowing (or where the sun is shining) and put to use where there is demand. Wind sources will thereby be everywhere more reliable.

Nick Medic, spokesman, British Wind Energy Association: “The proposed North Sea grid means that if you have less wind in the British sector, you can access wind blowing off the German coast.”

Who's for a North American Supergrid?

Initially, Supergrid will move offshore wind-generated electricity all around Europe. (click to enlarge)

Power supergrid plan to protect Europe from Russian threat to choke off energy
David Charter, November 13, 2008 (UK Times)

WHO
The European Commission (EC) of the European Union (EU)

WHAT
Now unequivocally aware of the need to escape dependence on Russian and Middle Eastern energy supplies, the EC’s Second Strategic Energy Review proposes Supergrid and a series of other measures to create a more secure energy supply.

click to enlarge

WHEN
- In the winter of 2005-06 Russia cut gas supplies to Eastern European satellite nations, giving the first hint of their inclination to bully those who were dependent.
- Supergrid was announced November 13 after years of discussions and proposals.
- The proposals compliment the EU’s triple 20 targets of a 20% cut in greenhouse gas emissions, a 20% increase in energy efficiency and obtaining 20% of its power from New Energy sources by 2020.
- The confrontation w/Russia over Georgia in August

WHERE
- Supergrid will ultimately link all EU states.
- The plan also calls for gas pipelines to Central Asia and Africa, a southern corridor pipeline to the Caspian region and a trans-Saharan pipe for gas from nations like Nigeria.
- New, high voltage transmission will link the wind-rich North Sea/Baltic Sea nations from the UK to Scandinavia and including the Netherlands, Germany, Norway and Eastern Europe. New transmission will also link EU Mediterranean nations and prepare them to transmit solar energy-generated electricity from North Africa and the Middle East.
- Norway and Holland recently agreed to connect via an undersea cable so as to exchange Norway’s hydropower and Holland’s complimentary wind.

WHY
- The defensive reason for the plan is Russia’s inclination to use energy as a lever.
- There is also a general economic uncertainty to energy imports.
- Europe imports 61% of its natural gas and without a change will import 73% by 2020.
- Russia sells Europe 40% of that, including the entire supply of some EU states.
to protect Europe’s energy from the threat of a Russian stranglehold
- Gazprom, Russia’s national energy company, is already negotiating to buy up the natural gas supplies of the Caspian and African countries to which the EU would build its pipelines.
- The EU’s long-term goal: Energy security through reliance on wind, solar, biogas and mixed-source natural gas supplies.
- Analysts estimate the 2 gas pipelines will cost billions of pounds.
- An EU-wide network will mean that wind power’s intermittency is virtually irrelevant.

Eventually, Supergrid may carry solar energy-generated electrcity from N. Africa and the Middle East. (click to enlarge)

QUOTES
- European Commission document: “[Europe must take] the first steps to break the cycle of increasing energy consumption, increasing imports, and increasing outflow of wealth created in the EU to pay energy producers… With respect to the EU, this is of most concern with respect to gas, where a number of member states are overwhelmingly dependent on one single supplier. Political incidents in supplier or transit countries, accidents or natural disasters . . . remind the EU of the vulnerability of its immediate energy supply.”
- UK government spokeswoman: “We have been calling for the EU to do more on energy security. The idea of a supergrid could support the Government’s aim of developing offshore wind power and other renewables and implementing more interconnection between European electricity markets…”
- EC draft document: “This work appears as a key element of the EU response to the current financial crisis and thus should be accelerated…”