NewEnergyNews: TODAY’S STUDY: NEW ENERGY SAVES BILLIONS

NewEnergyNews

Gleanings from the web and the world, condensed for convenience, illustrated for enlightenment, arranged for impact...

The challenge: To make every day Earth Day.

YESTERDAY

  • LABOR DAY STUDY: CHINA NEW ENERGY MOVES AHEAD
  • NO QUICK NEWS TODAY. BACK TOMORROW.
  • THE DAY BEFORE

  • Weekend Video: The Economic Opportunity In The Climate Fight
  • Weekend Video: The Future Of Energy
  • Weekend Video: Advances In BioEnergy
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    GET THE DAILY HEADLINES EMAIL: CLICK HERE TO SUBMIT YOUR EMAIL ADDRESS OR SEND YOUR EMAIL ADDRESS TO: herman@NewEnergyNews.net

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    THE DAY BEFORE THE DAY BEFORE

  • FRIDAY WORLD HEADLINE-CLIMATE CHANGE – IT GETS WORSE
  • FRIDAY WORLD HEADLINE-WHERE AND HOW WIND IS GROWING IN THE WORLD
  • FRIDAY WORLD HEADLINE-CHINA TO LEAD SOLAR MARKET GROWTH DESPITE OBSTACLES
  • FRIDAY WORLD HEADLINE-THE ENORMOUS POTENTIAL OF WORLD GEOTHERMAL
  • THE DAY BEFORE THAT

    THINGS-TO-THINK-ABOUT THURSDAY, August 28:

  • TTTA Thursday-PRESIDENT TO TAKE ACTION ON CLIMATE
  • TTTA Thursday-BIRDS AND ENERGY, THE BIGGER STORY
  • TTTA Thursday-NEW CA LAW STREAMLINES SOLAR PERMITTING
  • TTTA Thursday-DATA CENTER EFFICIENCIES CAN SAVE U.S. $3.8BIL/YR
  • AND THE DAY BEFORE THAT

  • THE STUDY: THE RISKIEST ENERGY IN THE WORLD
  • QUICK NEWS, August 27: VERIZON’S $40MIL SOLAR BUY; WIND PRICES HIT RECORD LOWS; NUKE INSPECTOR SAYS DIABLO CYN IS UNSAFE
  • THE LAST DAY UP HERE

  • THE STUDY: U.S. WIND RIGHT NOW
  • QUICK NEWS, August 26: CLIMATE MODELS PROVE RIGHT AGAIN; ABOUT INVESTING IN SOLAR; GM VS TESLA IN THE 200 MILE RACE -

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    Anne B. Butterfield of Daily Camera and Huffington Post, is a biweekly contributor to NewEnergyNews

  • Another Tipping Point: US Coal Supply Decline So Real Even West Virginia Concurs (REPORT)

    November 26, 2013 (Huffington Post via NewEnergyNews)

    Everywhere we turn, environmental news is filled with horrid developments and glimpses of irreversible tipping points.

    Just a handful of examples are breathtaking: Scientists have dared to pinpoint the years at which locations around the world may reach runaway heat, and in the northern hemisphere it's well in sight for our children: 2047. Survivors of Superstorm Sandy are packing up as costs of repair and insurance go out of reach, one threat that climate science has long predicted. Or we could simply talk about the plight of bees and the potential impact on food supplies. Surprising no one who explores the Pacific Ocean, sailor Ivan MacFadyen described long a journey dubbed The Ocean is Broken, in which he saw vast expanses of trash and almost no wildlife save for a whale struggling a with giant tumor on its head, evoking the tons of radioactive water coming daily from Fukushima's lamed nuclear power center. Rampaging fishing methods and ocean acidification are now reported as causing the overpopulation of jellyfish that have jammed the intakes of nuclear plants around the world. Yet the shutting down of nuclear plants is a trifling setback compared with the doom that can result in coming days at Fukushima in the delicate job to extract bent and spent fuel rods from a ruined storage tank, a project dubbed "radioactive pick up sticks."

    With all these horrors to ponder you wouldn't expect to hear that you should also worry about the United States running out of coal. But you would be wrong, says Leslie Glustrom, founder and research director for Clean Energy Action. Her contention is that we've passed the peak in our nation's legendary supply of coal that powers over one-third of our grid capacity. This grim news is faithfully spelled out in three reports, with the complete story told in Warning: Faulty Reporting of US Coal Reserves (pdf). (Disclosure: I serve on CEA's board and have known the author for years.)

    Glustrom's research presents a sea change in how we should understand our energy challenges, or experience grim consequences. It's not only about toxic and heat-trapping emissions anymore; it's also about having enough energy generation to run big cities and regions that now rely on coal. Glustrom worries openly about how commerce will go on in many regions in 2025 if they don't plan their energy futures right.

    2013-11-05-FigureES4_FULL.jpgclick to enlarge

    Scrutinizing data for prices on delivered coal nationwide, Glustrom's new report establishes that coal's price has risen nearly 8 percent annually for eight years, roughly doubling, due mostly to thinner, deeper coal seams plus costlier diesel transport expenses. Higher coal prices in a time of "cheap" natural gas and affordable renewables means coal companies are lamed by low or no profits, as they hold debt levels that dwarf their market value and carry very high interest rates.

    2013-11-05-Table_ES2_FULL.jpgclick to enlarge

    2013-11-05-Figure_ES2_FULL.jpg

    One leading coal company, Patriot, filed for bankruptcy last year; many others are also struggling under bankruptcy watch and not eager to upgrade equipment for the tougher mining ahead. Add to this the bizarre event this fall of a coal lease failing to sell in Wyoming's Powder River Basin, the "Fort Knox" of the nation's coal supply, with some pundits agreeing this portends a tightening of the nation's coal supply, not to mention the array of researchers cited in the report. Indeed, at the mid point of 2013, only 488 millions tons of coal were produced in the U.S.; unless a major catch up happens by year-end, 2013 may be as low in production as 1993.

    Coal may exist in large quantities geologically, but economically, it's getting out of reach, as confirmed by US Geological Survey in studies indicating that less than 20 percent of US coal formations are economically recoverable, as explored in the CEA report. To Glustrom, that number plus others translate to 10 to 20 years more of burning coal in the US. It takes capital, accessible coal with good heat content and favorable market conditions to assure that mining companies will stay in business. She has observed a classic disconnect between camps of professionals in which geologists tend to assume money is "infinite" and financial analysts tend to assume that available coal is "infinite." Both biases are faulty and together they court disaster, and "it is only by combining thoughtful estimates of available coal and available money that our country can come to a realistic estimate of the amount of US coal that can be mined at a profit." This brings us back to her main and rather simple point: "If the companies cannot make a profit by mining coal they won't be mining for long."

    No one is more emphatic than Glustrom herself that she cannot predict the future, but she presents trend lines that are robust and confirmed assertively by the editorial board at West Virginia Gazette:

    Although Clean Energy Action is a "green" nonprofit opposed to fossil fuels, this study contains many hard economic facts. As we've said before, West Virginia's leaders should lower their protests about pollution controls, and instead launch intelligent planning for the profound shift that is occurring in the Mountain State's economy.

    The report "Warning, Faulty Reporting of US Coal Reserves" and its companion reports belong in the hands of energy and climate policy makers, investors, bankers, and rate payer watchdog groups, so that states can plan for, rather than react to, a future with sea change risk factors.

    [Clean Energy Action is fundraising to support the dissemination of this report through December 11. Contribute here.]

    It bears mentioning that even China is enacting a "peak coal" mentality, with Shanghai declaring that it will completely ban coal burning in 2017 with intent to close down hundreds of coal burning boilers and industrial furnaces, or shifting them to clean energy by 2015. And Citi Research, in "The Unimaginable: Peak Coal in China," took a look at all forms of energy production in China and figured that demand for coal will flatten or peak by 2020 and those "coal exporting countries that have been counting on strong future coal demand could be most at risk." Include US coal producers in that group of exporters.

    Our world is undergoing many sorts of change and upheaval. We in the industrialized world have spent about a century dismissing ocean trash, overfishing, pesticides, nuclear hazard, and oil and coal burning with a shrug of, "Hey it's fine, nature can manage it." Now we're surrounded by impacts of industrial-grade consumption, including depletion of critical resources and tipping points of many kinds. It is not enough to think of only ourselves and plan for strictly our own survival or convenience. The threat to animals everywhere, indeed to whole systems of the living, is the grief-filled backdrop of our times. It's "all hands on deck" at this point of human voyaging, and in our nation's capital, we certainly don't have that. Towns, states and regions need to plan fiercely and follow through. And a fine example is Boulder Colorado's recent victory to keep on track for clean energy by separating from its electric utility that makes 59 percent of its power from coal.

    Clean Energy Action is disseminating "Warning: Faulty Reporting of US Coal Reserves" for free to all manner of relevant professionals who should be concerned about long range trends which now include the supply risks of coal, and is supporting that outreach through a fundraising campaign.

    [Clean Energy Action is fundraising to support the dissemination of this report through December 11. Contribute here.]

    Author's note: Want to support my work? Please "fan" me at Huffpost Denver, here (http://www.huffingtonpost.com/anne-butterfield). Thanks.

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    Anne's previous NewEnergyNews columns:

  • Another Tipping Point: US Coal Supply Decline So Real Even West Virginia Concurs (REPORT), November 26, 2013
  • SOLAR FOR ME BUT NOT FOR THEE ~ Xcel's Push to Undermine Rooftop Solar, September 20, 2013
  • NEW BILLS AND NEW BIRDS in Colorado's recent session, May 20, 2013
  • Lies, damned lies and politicians (October 8, 2012)
  • Colorado's Elegant Solution to Fracking (April 23, 2012)
  • Shale Gas: From Geologic Bubble to Economic Bubble (March 15, 2012)
  • Taken for granted no more (February 5, 2012)
  • The Republican clown car circus (January 6, 2012)
  • Twenty-Somethings of Colorado With Skin in the Game (November 22, 2011)
  • Occupy, Xcel, and the Mother of All Cliffs (October 31, 2011)
  • Boulder Can Own Its Power With Distributed Generation (June 7, 2011)
  • The Plunging Cost of Renewables and Boulder's Energy Future (April 19, 2011)
  • Paddling Down the River Denial (January 12, 2011)
  • The Fox (News) That Jumped the Shark (December 16, 2010)
  • Click here for an archive of Butterfield columns

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    Some details about NewEnergyNews and the man behind the curtain: Herman K. Trabish, Agua Dulce, CA., Doctor with my hands, Writer with my head, Student of New Energy and Human Experience with my heart

    email: herman@NewEnergyNews.net

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    Your intrepid reporter

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      A tip of the NewEnergyNews cap to Phillip Garcia for crucial assistance in the design implementation of this site. Thanks, Phillip.

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    Pay a visit to the HARRY BOYKOFF page at Basketball Reference, sponsored by NewEnergyNews and Oil In Their Blood.

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  • Tuesday, November 22, 2011

    TODAY’S STUDY: NEW ENERGY SAVES BILLIONS

    Toward a Sustainable Future for the U.S. Power Sector: Beyond Business as Usual 2011
    Geoff Keith, Bruce Biewald, Ezra Hausman, Kenji Takahashi, Tommy Vitolo, Tyler Comings and Patrick Knight, November 16, 2011 (Synapse Energy Economics/Civil Society Institute)

    Introduction and Summary

    In 2010 the Civil Society Institute released Beyond Business as Usual, a study evaluating a strategy for the U.S. electric industry that would provide large-scale public health and environmental benefits at a reasonable cost. The strategy, built around energy efficiency and renewable resources, would also provide substantial reductions in carbon emissions. Since then, the debate has continued over the best way forward for the electric industry.

    Advocates of a future based on coal with new environmental controls and carbon capture continue to make their case, as do advocates of nuclear power.

    Away from this debate, new evidence has emerged that major changes in this industry are needed. Several mining tragedies globally have underscored the human toll of the coal supply chain. New EPA initiatives targeting air toxics, coal ash, and effluent releases highlight the environmental impacts of coal and the cost of addressing them with control technologies. The use of fracking in natural gas exploration is coming under scrutiny, with evidence of groundwater contamination and greenhouse gas emissions. Concerns are increasing about the vast amounts of water used at coal-fired and nuclear power plants, particularly in regions of the country facing water shortages. Events at the Fukushima nuclear plant have renewed doubts about the ability to operate large numbers of nuclear plants safely over the long term. Further, cost estimates for “next generation” nuclear units continue to climb, and lenders are unwilling to finance these plants without taxpayer guarantees.

    click to enlarge

    In addition to these troubling events, however, information has emerged over the past year suggesting that the cost of replacing coal with clean energy is falling. The current and projected price of coal has increased, and the price of photovoltaic (PV) systems has fallen sharply since 2009, a result of unprecedented growth in this sector globally.

    Further, the financial sector is increasingly placing risk premiums on technologies with carbon emissions, making renewable energy and efficiency more attractive in comparison. Given these trends, a revision of last year’s study seemed especially timely.

    click to enlarge

    For this revision, we have incorporated the price changes mentioned above, and we have revised several other assumptions based on feedback received on last year’s study. We have lowered our assumed capacity factors for wind generators and increased the assumed cost of wind energy. We have increased the assumed cost of sustaining high levels of efficiency savings over the study period and revised our estimate of the cost savings that would accrue from retiring coal-fired plants rather than retrofitting them with new environmental controls.

    Our methodology remains essentially the same as in the 2010 study. We use the U.S. Energy Information Administration’s annual modeling work to establish a reference case, or “business as usual” (BAU) scenario. We compare this to a “Transition Scenario” in which the country moves toward a power system based on efficiency and renewable energy. In this scenario all coal-fired power plants are retired, along with nearly a quarter of the nation’s nuclear fleet, by 2050.

    click to enlarge

    Reliance on energy efficiency and renewable energy is significantly increased, while natural gas use is lower than under BAU. Importantly, the Transition Scenario does not rely on hoped-for breakthroughs; nearly all of demand is met throughout the study period with technologies that are commercial today.

    We estimate the net costs and benefits of the Transition Scenario relative to BAU using a spreadsheet model that accounts for generating capacity, energy, fuel use, costs, emissions, and water use. We perform the analysis on a regional basis, with the country divided into ten regions. We are careful to ensure that there is sufficient generating capacity in both scenarios and that there is a reasonable mix of energy sources in each region from the perspective of power system operation. For most of our technology cost and performance assumptions we rely on the Annual Energy Outlook (AEO) 2011 data.

    For some resources, however, we believe that other sources provide a more accurate picture of current and expected costs, and we base our assumptions on those sources. Finally, we perform sensitivity analyses around a number of important input assumptions.

    click to enlarge

    The Transition Scenario compares to BAU as follows.

    Total U.S. electricity use grows by 0.9% per year under BAU to 5,590 Terawatt-hours (TWh) in 2050. In the Transition Scenario, more aggressive energy efficiency programs across the country reduce electricity use by about 0.1% per year to 3,760 TWh in 2050.

    Under BAU, coal-fired generation grows from just over 1,860 TWh in 2010 to 2,340 TWh in 2050 – a 26% increase. In the Transition Scenario, coal-fired generation is eliminated by 2050.

    Natural gas-fired generation grows from 1,010 to 1,840 TWh under BAU, while it rises to only 1,230 TWh in the Transition Scenario.

    click to enlarge

    Nuclear generation rises from 800 to 870 TWh under BAU, due to uprates at existing plants across the country and the addition of new units totaling 6,200 MW in the Southeast. Nuclear generation falls to 618 TWh in the Transition Scenario, a reduction of 23%.

    Wind energy grows from 92 to 189 TWh under BAU, while it grows to 611 TWh in the Transition Scenario. This includes over 60 TWh from offshore wind farms.

    PV generation grows from 4 to 24 TWh under BAU, and it grows to 842 TWh in the Transition Scenario.

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    The results of this analysis are encouraging. We find that a transition to efficiency and renewable energy in the power sector is likely to be less expensive than BAU. Table 1 shows the net costs of the Transition Scenario relative to BAU at four points in time.

    These are annual costs, not cumulative. The net present value of the 40-year stream of savings and costs is a savings of $83 billion, discounted at 4.8%.

    The net annual cost impacts range from savings of $18 billion in 2050 to costs of $9 billion in 2040. To put this in perspective, $18 billion is about 5% of total electric industry revenues in 2010, assuming 3,730 TWh sold at an average price of ¢10 per kWh. As seen in Table 1, when spread over all kWhs sold in the relevant year, the annual savings in 2020 are ¢0.4 per kWh consumed, and the costs in 2040 are ¢0.3 per kWh.

    click to enlarge

    We present several sensitivity analyses to gauge the range of uncertainty around these net savings. The variables with the largest impacts on the results are the cost of energy saved through efficiency measures, the cost of coal, and the cost of new PV capacity. However, in all of the sensitivity analyses, the Transition Scenario provides savings on an NPV basis relative to BAU.

    The idea that we could capture the kind of benefits this scenario provides while also saving money is a significant change in our thinking about this industry. It reflects a fundamental shift in the cost of renewable energy relative to fossil-fueled and nuclear energy. These findings are particularly striking, given that the BAU scenario includes no carbon costs or carbon reductions. If the cost of carbon reductions were included under BAU, the savings provided by the Transition Scenario would grow dramatically. We also have not included externalized costs of pollution in our cost analysis, although we have estimated some of the health benefits of the Transition Scenario.

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    The benefits of the Transition Scenario include the following:

    By 2020, power sector CO2 emissions fall 25% below 2010 levels. By 2050 they are 81% below 2010 levels. Under BAU, CO2 emissions grow by 28% through 2050.

    Other environmental and health impacts of coal-fired electricity are dramatically reduced and, by 2050, eliminated altogether. This includes the air and water impacts of generation, coal ash and other solid waste, and the impacts of mining and coal transportation.

    Cooling water withdrawals at power plants fall from 55 to 0.6 trillion gallons per year in the Transition Scenario. In 2050 they are more than 90% below BAU levels. Water consumption at power plants (via evaporation) falls from 1.5 to 0.6 trillion gallons per year, 76% below BAU levels.

    Over $450 billion in health effects related to air pollution would be avoided over the study period, based on damage factors developed by the National Research Council. (We do not include these costs in calculating the net cost of electricity production for the Transition Scenario.) This translates into roughly 55 thousand fewer premature deaths in the Transition Scenario than under BAU.

    click to enlarge

    The construction and operation of the new power plants in the first decade of the Transition Scenario creates roughly 3.1 million new job-years – the equivalent of 310,000 people employed for the entire decade.

    Over $100 billion would be saved by retiring coal-fired plants rather than retrofitting them with new environmental controls.

    The annual production of high-level radioactive waste would be reduced by nearly a
    quarter, and the risks associated with nuclear power generation and the nuclear fuel cycle would be reduced as well.

    Natural gas use would be lower than BAU in all years of the study period. In 2050, gas use would be below BAU by 3.7 quadrillion Btu per year, or 28%.

    It is important to note that this scenario seeks to address a wide range of problems, and we have had to make tradeoffs among competing benefits. The study does not intend to lay out an optimized or detailed roadmap for the industry. Rather, it explores a fundamental change in direction. The intent is to challenge assumptions and inform the debate about U.S. energy policy. CSI expects to continue adjusting this Transition Scenario as more information becomes available, and we hope that other groups will explore variations on it as well. In terms of further research, the study points to the following areas of uncertainty.

    click to enlarge

    1. What is the most reliable and cost effective way for system operators to integrate high levels of variable generation into regional power systems? How much variable generation can a balancing area accommodate when the other resources are predominantly flexible ones rather than inflexible, baseload plants?

    2. How will developments in the transportation sector affect the electric industry? Will transportation move to electricity on a large scale or to other fuels? If that sector does move toward electricity, how much power will it require and what kind of energy storage resource will electric vehicles offer?

    3. What are the risks and carbon emissions associated with drilling in shale formations? What technologies and practices do we need to develop to minimize the use of natural gas as we phase out coal-fired generation?

    Work in these areas is already underway at research labs, utilities, and government agencies globally. We hope that this study adds momentum to this and other work focused on the transition to a sustainable electric industry.

    Finally, the fact that CO2 emissions increase in our BAU scenario is important. While BAU is a useful baseline against which to compare alternative scenarios, it is not a tenable future. We must achieve significant carbon reductions over the next several decades. Therefore, the net costs and benefits of the Transition Scenario should be compared to those of other proposals that provide meaningful carbon reductions. To date we have not seen cost benefit analyses of futures built around new nuclear power or coal with carbon sequestration.

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