The Economic Opportunity In The Climate Fight

The EU has cut emissions 18% while its GDP has grown 45%. It is now targeting a 40% emissions cut by 2030. Imagine the economic growth! From MelissaBloggerOne via YouTube

Tweet

The Future Of Energy

It may sound like science fiction to some but the world is already on the way to this future and there is no stopping now. From Vestas via YouTube

Tweet

Advances In BioEnergy

Scientists with solutions. From U.S. Department of Energy

Tweet

CLIMATE CHANGE – IT GETS WORSE

Severe, Pervasive, Irreversible: IPCC's Devastating Climate Change Conclusions

Jon Queally, August 27, 2014 (Common Dreams via Center for Media and Democracy)

“Climate change is here. Climate change is now. Climate change will be significantly more dangerous, deadly, and expensive if nothing is done to correct humanity's course, but aspects of future shifts are probably already irreversible…according to the United Nations Intergovernmental Panel on Climate Change (IPCC) draft Synthesis Report…[which] offers a stark assessment of the perilous future the planet and humanity face due to global warming and climate change…Based on a clear and overwhelming consensus among the world's leading scientists, the draft says that failure to adequately acknowledge and act on previous warnings has put the planet on a path where ‘severe, pervasive and irreversible impacts’ of human-caused climate change will surely be felt in the decades to come…

“[T]he draft includes not new information per se, but employs stronger language and contains a more urgent warning than the previous reports…According to the Associated Press, which reviewed the 127-page document, the IPCC draft paints a harsh warning of what’s causing global warming and what it will do to humans and the environment. It also describes what can be done about it…Using blunter, more forceful language than the reports that underpin it, the new draft highlights the urgency of the risks that are likely to be intensified by continued emissions of heat-trapping gases, primarily carbon dioxide released by the burning of fossil fuels like coal, oil and natural gas…The report found that companies and governments had identified reserves of these fuels at least four times larger than could safely be burned if global warming is to be kept to a tolerable level…” click here for more

click to enlarge

Tweet

WHERE AND HOW WIND IS GROWING IN THE WORLD

Europe Dominates World Wind Power Share, But Trails in Capacity

Matt Petronzio, August 24, 2014 (Mashble)

“…Most of the leading countries with the highest percentages of wind energy in 2013 were located in Europe…Denmark tops the list, generating one-third (33.8%) of its electricity from wind power…Portugal's wind farms generated nearly 25% of the country's electricity in 2013, while Spain generated nearly 21%, followed by Ireland (17.3%), Germany (7.9%) and the UK (7.7%). Outside of Europe, China and the U.S. have the highest wind-power share — the amount of electricity that wind power generates, compared to the country's overall electricity production — at 6% and 4.1%, respectively…[On the other hand,] China may only generate 6% of its electricity with wind, but its wind facilities are designed to produce 91,400 megawatt-hours of energy. That's compared to Denmark's 4,800 megawatt-hours…While wind energy has many benefits, certain barriers continue to inhibit advances in its production around the world, including regulatory hurdles, financial challenges, political opposition and "not in my backyard" aesthetic concerns…” click here for more

click to enlarge

Tweet

CHINA TO LEAD SOLAR MARKET GROWTH DESPITE OBSTACLES

Led by China, Solar Market to Grow 75% to 65.6 GWp in 2019; The market will average 8% annual growth despite new challenges such as trade disputes with China and changes in global policy…

August 26, 2014 (Lux Research)

"Led by China, the solar industry will grow at a CAGR of 8.3% – from 37.5 GWp in 2013 to 65.6 GWp in 2019 – but emerging trade disputes involving the Asian giant, as much as global policies, cast a shadow over short-term prospects…China became the biggest solar market in the world with 11.8 GWp installations in 2013, and has been key to faster-than-expected global recovery. Since the competitive bankruptcy-ridden cost environment of 2012, module supplier margins have increased, with most Tier-1 suppliers topping 10% toward the end of 2013 and 15% in the first quarter of 2014…[according to Solar Market Size Update 2014: Reform for the Long Haul]…At a CAGR of 16.3%, the Americas [led by the U.S.] will be the fastest-growing region in the world as its new installations market nearly triples from 5.3 GWp in 2013 to 15.4 GWp in 2019…[I]ncremental increases in efficiency are on course from [new] technologies…[tha will cut system costs 20% and] by between $0.36/Wp for utility-scale and $0.60/Wp for residential by 2019…Crystalline silicon (x-Si) will dominate the solar market through 2019 [though CIGS, CZTS, CdTe, and epi-Si have the potential to become major threats…” click here for more

click to enlarge

Tweet

THE ENORMOUS POTENTIAL OF WORLD GEOTHERMAL

Geothermal power approaches 12,000 megawatts worldwide

J. Matthew Roney, August 27, 2014 (Earth Policy Institute via Blouin News)

“In 2013, world geothermal electricity-generating capacity grew 3% to top 11,700 megawatts across 24 countries…[It] was geothermal’s best year since the 2007-08 financial crisis…[T]he upper six miles of the earth’s crust holds 50,000 times the energy embodied in the world’s oil and gas reserves…[But] test-drilling to assess deep heat resources prior to building a geothermal power plant is uncertain and costly. The developer may spend 15% of the project’s capital cost during test-drilling, with no guarantee of finding a viable site…Once built, however, a geothermal power plant can generate electricity 24 hours a day with low operation and maintenance costs – importantly because there is zero fuel cost…

"The top three countries in installed geothermal power capacity – the United States, the Philippines, and Indonesia – account for more than half the world total…Iceland holds the top spot in [generating electricity from geothermal], using geothermal power for 29% of its electricity. Close behind is El Salvador, where one quarter of electricity comes from geothermal plants. Kenya follows at 19%. Next are the Philippines and Costa Rica, both at 15%, and New Zealand, at 14%...Indonesia is just one of about 40 countries that could get all their electricity from indigenous geothermal power – a list that includes Ecuador, Ethiopia, Iceland, Kenya, Papua New Guinea, Peru, the Philippines, and Tanzania…” click here for more

click to enlarge

Tweet

PRESIDENT TO TAKE ACTION ON CLIMATE

Obama Pursuing Climate Accord in Lieu of Treaty

Coral Davenport, August 26, 2014 (NY Times)

“The Obama administration is working to forge a sweeping international climate change agreement to compel nations to cut their planet-warming fossil fuel emissions, but without ratification from Congress…[N]egotiators are meeting with diplomats from other countries to broker a deal [to be signed at a 2015 United Nations Paris summit] to commit some of the world’s largest economies to enact laws to reduce their carbon pollution...To sidestep [the Constitutional requirement of a two-thirds majority of the Senate approval of legally binding treaties], President Obama’s climate negotiators are devising what they call a ‘politically binding’ deal that would ‘name and shame’ countries into cutting their emissions…[It would likely face] strong objections from Republicans on Capitol Hill and from poor countries around the world, but negotiators say it may be the only realistic path…” click here for more

click to enlarge

Tweet

BIRDS AND ENERGY, THE BIGGER STORY

CHART: How Many Birds Are Killed By Wind, Solar, Oil, And Coal?

Emily Atkin, August 25, 2014 (ClimateProgress)

“In response to growing accusations from both conservationists and conservatives that renewable energy sources like solar and wind kill too many birds, U.S. News and World Report has compiled data on which energy industries are responsible for the most bird deaths every year…[B]oth low-range and high-range estimates for how many birds are killed by those electricity sources…[E]ven with high-range estimates for renewables compared to low-range estimates for fossil fuels, fossil fuels are responsible for far more bird fatalities than solar or wind…The results should be taken with a grain of salt…[because there is] no standardized way of doing it…[and] some of the research used is outdated, and does not take into account that renewable power stands to increase in the United States…

"For oil and gas, both the low and high estimates came from a Bureau of Land Management memo from 2012…The high estimate [for solar power] comes from the Center for Biological Diversity, whose estimate is just from [one solar farm] in California. Bird deaths from solar farms have been estimated to be relatively low…[The coal] bird death numbers came from a peer-reviewed study in the journal Renewable Energy…[and it included] everything from coal mining to production — and bird deaths from climate change that coal emissions produce. Together, that amounted to about five birds per gigawatt-hour of energy produced by coal, almost 8 million per year…[N]one of these numbers hold a candle to cats, which are estimated to kill 1.4 to 3.7 billion birds every year.” click here for more

click to enlarge

Tweet

NEW CA LAW STREAMLINES SOLAR PERMITTING

Assembly bill could lower cost of residential solar in California

Chad Garland, August 23, 2014 LA Times

The Solar Permitting Efficiency Act (AB 2188), designed to streamline and standardize the permitting process statewide and save solar buyers $1,000 or more on installations, passed California’s Senate 22-1, and its Assembly 66-1, and is expected to be quickly signed into law by Governor Jerry Brown…The bill, which requires cities and counties to adopt ordinances that make residential rooftop solar system permitting and inspection more uniform and faster, was written by Assemblyman Al Muratsuchi (D-Torrance) after officials from Torrance’s Verengo Solar told him some jurisdictions’ bureaucratic red tape delay installation 65 days. Manufacturing efficiencies have steadily driven down solar hard costs since 2006 but soft costs like those from delays in permitting and interconnection have remained nearly unchanged because California’s 500-plus jurisdictions have an array of non-uniform processes and codes. click here for more

click to enlarge

Tweet

DATA CENTER EFFICIENCIES CAN SAVE U.S. $3.8BIL/YR

America's Data Centers Consuming and Wasting Growing Amounts of Energy; Critical Action Needed to Save Money and Cut Pollution

Pierre DelForge, August 26, 2014 (Natural Resources Defense Council)

“…In 2013, U.S. data centers [--the backbone of the modern economy--] consumed an estimated 91 billion kilowatt-hours of electricity…and are on-track to reach 140 billion kilowatt-hours by 2020…Some large server farms operated by well-known Internet brands provide shining example of ultra-efficient data centers. Yet small, medium, and corporate data centers are responsible for the vast majority of data center energy consumption and are generally much less efficient…The largest issues and opportunities for energy savings include the under-utilization of data center equipment and the misalignment of incentives, including in the fast growing multi-tenant data center market segment…To move forward, systemic measures such as the public disclosure of [simple] efficiency metrics are necessary to create the conditions for best-practice efficiency behaviors…[and cut electricity consumption in U.S. data centers] by as much as 40 percent…[saving] U.S. businesses $3.8 billion a year.” click here for more

click to enlarge

Tweet

TODAY’S STUDY: THE RISKIEST ENERGY IN THE WORLD

Oil & Gas Majors: Fact Sheets

August 2014 (Carbon Tracker Initiative)

Executive Summary

Overview: Key Points

1. The oil & gas sector is currently facing pressure from investors to focus on capital discipline, and several majors have stated that their capex will either fall or stay flat over the coming years.

2. In order to sustain shareholder returns, companies should focus on low cost projects, deferring or cancelling projects with high breakeven costs. Capital could be redeployed to share buybacks or increased dividends.

3. This process has already started, particularly in the Canadian oil sands sector. The majors’ portfolios include several significant arctic and deep water/ultra-deep water projects which could prove low return assets in a low-demand scenario. Deferral or cancellation of these might protect shareholder returns.

4. Collectively, the majors have a potential capital spend of $548bn over the period 2014-2025 on projects that require a market price of at least $95/bbl for sanction (34% of total capex on all their projects).

5. $357bn of this is on high cost projects that are yet to be developed. Such projects are candidates for deferral or cancellation.

6. Investors may wish to push companies for more detailed disclosure of project level economics, and challenge developments that carry an undue risk of wasting capital and destroying value.

click to enlarge

Introduction

CTI has demonstrated in its research the mismatch between continuing growth in oil demand and reducing carbon emissions to limit global warming. Our most recent research with ETA to produce the carbon cost supply curve for oil indicates that there is significant potential production that could be considered both high cost and in excess of a carbon budget. We have focused our research on undeveloped projects that, allowing for a $15/bbl contingency, would need a $95/bbl market price or above to be sanctioned (i.e. a market price required for sanction of $95/bbl is equivalent to a project breakeven price of $80/bbl), as they are the marginal barrels that could be exposed to a lower demand and price scenario in the future.

This note examines the seven largest publicly listed oil companies’ potential future project portfolios looking at production and capex using Rystad Energy’s UCube Upstream database (as at July 2014). “Capex” and “production” in this note (amongst other terms) are thus based on Rystad’s analysis and expectations of the company’s potential projects. The companies’ planned or realised capex and production may differ from these projections. Where possible we have sought to verify the status of the projects at the time of writing. A $15/bbl premium has been included in the required market prices for sanction of oil sands projects to account for additional transport costs. Individual company portfolios and exposure to high-risk projects are contained in the individual company factsheets which accompany this summary comparison.

click to enlarge

Projects Shelved

There have been some recent examples of projects being put on ice by the majors. In the oil sands in 2014, Total and Suncor have shelved the $11bn Joslyn project1 and Shell put on hold its Pierre River project2 . Deepwater projects have also been deferred with BP not proceeding with its Mad Dog extension in the Gulf of Mexico3 , and Chevron reviewing its $10bn Rosebank project in the North Sea4. In the Arctic, Statoil and Eni have deferred a decision on the $15.5bn Johan Castberg project5.

Some companies are therefore already starting to demonstrate greater capital discipline amidst falling group returns. This is becoming increasingly necessary as near term cash flows are not sufficient to maintain both dividends and capital expenditure plans. In the short-term companies have squared the circle by selling assets or adding debt. Cutting capital spend should improve corporate cash flow statements as could new cash flow from new projects. But with some companies continuing to sanction projects at the high end of the cost curve, hence increasing operational gearing, shareholder value could be put at risk should demand and hence oil prices be lower than the majors anticipate.

click to enlarge

Potential Production

• Shell has one of the highest proportions of high-cost potential production, with 45% requiring a market price of $75/bbl and 30% requiring at least $95/bbl, although ConocoPhillips has the highest cost production profile with 56% and 36% respectively.

• Eni and BP have the portfolios with the lowest oil market price requirements, 30% and 40% of which respectively requiring above $75/bbl and 15% and 21% of which respectively requiring at least $95/bbl.

click to enlarge

Potential Capex

• Turning to capital spend in the nearer term (2014-2025) Total and ExxonMobil’s capital budgets have some of the highest oil price requirements, with 60% and 68% respectively on potential projects requiring a market price of at least $75/bbl for sanction and 40% and 39% requiring at least $95/bbl (including a $15/bbl contingency allowance).

• Shell is not dissimilar with 65% of its potential capex requiring a market price over $75/bbl and 37% over $95/bbl.

• BP and Eni again have the lowest proportion of high-price requirements, with 25% and 28% on projects that need a market price of at least $95/bbl for sanction, although Eni and ConocoPhillips have the least exposure to projects that would be need at least $75/bbl with 54% and 59%.

• Looking at just undeveloped projects, 27% of Total’s and 26% of Shell’s capex in this category requires a market price of $95/bbl+.

• By contrast, only 17% of ConocoPhillips’s potential capex budget is on high-cost projects that are as yet undeveloped. BP and Exxon have the second lowest exposure with with 20% of their capex in this category.

click to enlarge

• “Undeveloped” in this sense comprises fields where a discovery has been made (“discovery”) and where no discovery has been made (“undiscovered”)

• Oil sands projects account for 27% and 26% of Shell and ConocoPhillips’s high-cost potential development spend.

• Capital spend on undeveloped, high-break even projects is heavily biased towards the unconventional category, with just 14% of overall potential spend on conventional projects.

• BP and Total have particularly high exposure to deep water developments, with deep water and ultra-deep water in aggregate representing 78% and 73% of potential high cost spend respectively.

• ConocoPhillips is heavily biased towards arctic projects proportionately, which represent 24% of potential spend compared to an average of 5% amongst the other majors.

click to enlarge

Cancellation Candidates

Focusing on individual projects for each company, there are a number of undeveloped, high-cost projects which are prime candidates for cancellation…The top twenty largest projects which represent high-risk, high-cost options for the oil majors…are primarily a mix of Alberta oil sands and deep water projects in the Atlantic, which would represent $91 billion of capital (over the period 2014-25). This capital could instead be returned to shareholders rather than being put at risk in projects that are already high cost and low return. Such projects have high operational gearing, putting shareholder returns at risk in a low oil price environment.

Key Questions

As well as specific questions on high cost projects and risk concentration identified for each company, investors should continue to push for disclosure on the following issues across the sector:

1. How does continuing dependence on oil fit with the imperative to tackle climate change recognised by most oil companies?

2. How would a range of oil prices impact your project economics and hence future earnings?

3. How does the current strategy of reinvesting revenues in high cost oil projects deliver shareholder value in a low demand, low price scenario?

Tweet

QUICK NEWS, August 27: VERIZON’S $40MIL SOLAR BUY; WIND PRICES HIT RECORD LOWS; NUKE INSPECTOR SAYS DIABLO CYN IS UNSAFE

VERIZON’S $40MIL SOLAR BUY Verizon Announces $40 Million Solar Energy Investment

Kiley Kroh, August 25, 2014 (Climate Progress)

“…Verizon Wireless Inc. [the biggest U.S. wireless carrier] will invest $40 million into 10.2 megawatts (MW) of solar power…at eight Verizon network facilities in California, Maryland, Massachusetts, New Jersey, and New York…[They] will nearly double the amount of power the company derives from solar energy…[Solar is] a key component of the company’s sustainability plan…[according to the company, and] the steadily declining cost of solar power made it a smart financial move…Rhone Resch, president of the Solar Energy Industries Association (SEIA), said the latest move by Verizon puts the company at the top of U.S. telecom companies investing in solar power…[and by year’s end] Verizon will be among the top 20 of all companies nationwide [in number of solar installations and solar generating capacity]…Last year, Verizon announced a $100 million investment in a combination of solar panels and fuel cell technology, a decision it predicted would not only lower utility bills and emissions but also improve the reliability of its operations…” click here for more

click to enlarge

Tweet

WIND PRICES HIT RECORD LOWS How Low Can Wind Energy Go? 2.5¢ Per Kilowatt-Hour Is Just The Beginning

Tina Casey, August 23, 2014 (Clean Technica)

“…[A] new Department of Energy report on the US wind energy market…came up [with a new low] average cost for wind energy…[But the] 2013 Wind Technologies Market Report repeatedly cautions that the 2013 sample size is small compared to previous annual wind energy reports...[T]he 2014 sample will be much larger, at 16 projects totaling more than 2 GW (gigawatts)…Power purchase agreements (PPAs) are quickly becoming the financing deal of choice for wind as well as solar power. The report notes that PPAs for wind energy reached a new low on 2013, pegging the figure at $25 per MWh or 2.5¢ per kWh…[M]ost of the projects in the sample are located in the…high-quality wind interior, where costs are lower…[but] the latest generation of wind turbines is on a technology trend that enables a continued decline [in PPA price], even in less than optimal wind areas…[T]he report is confident that wind PPAs will give natural gas a run for the money over the next 25 years, at least in the Interior…[and] beat the pants off other fossil fuels in some regions…” click here for more

click to enlarge

Tweet

NUKE INSPECTOR SAYS DIABLO CYN IS UNSAFE Hearings planned after call for nuke-plant closure

Michael R. Blood, August 25, 2014 AP via Yahoo News

A verified confidential filing with the Nuclear Regulatory Commission by former Diablo Canyon Nuclear Power Plant on-site inspector Michael Peck, a PHD in nuclear engineering and senior NRC instructor, recommends shutting down the California plant until its two reactors can be shown capable of withstanding earthquake forces unanticipated when the facility was built, a recommendation made more central by the recent magnitude-6 earthquake in Northern California. Pacific Gas and Electric Co., which owns and operates Diablo Canyon, argues the 1,122 megawatt unit 1, which went online in 1985, and the 1,118 megawatt unit two, which went online in 1986, have had thorough NRC analysis and are "seismically safe" since being retrofitted during construction in the 1970s. Environmentalists argue its 50-mile proximity to a half million people requires higher standards and Peck cited PG&E 2011 research that determined any of three nearby faults is capable of producing significantly more “peak ground acceleration” than was expected in the 1970s. Senate Environment and Public Works Committee Chair Barbara Boxer (D-CA), a supporter of the NRC’s directive to U.S. nuclear plants to reevaluate seismic risks by March 2015 since the 2011 magnitude-9 earthquake and tsunami caused a meltdown at Japan’s Fukushima Daiichi plant, will hold hearings on why Peck’s July 2013 filing has gone unanswered. click here for more

click to enlarge

Tweet

TODAY’S STUDY: U.S. WIND RIGHT NOW

2013 Wind Technologies Market Report

Ryan Wiser, Mark Bolinger, et al, August 18, 2014 (Lawrence Berkeley National Laboratory)

Executive Summary

Annual wind power capacity additions in the United States were modest in 2013, but all signals point to more-robust growth in 2014 and 2015. With the industry’s primary federal support—the production tax credit (PTC)—only available for projects that had begun construction by the end of 2013, the next couple years will see those projects commissioned. Near-term wind additions will also be driven by recent improvements in the cost and performance of wind power technologies. At the same time, the prospects for growth beyond 2015 are uncertain. The PTC has expired, and its renewal remains in question. Continued low natural gas prices, modest electricity demand growth, and limited near-term demand from state renewables portfolio standards (RPS) have also put a damper on industry growth expectations. These trends, in combination with increasingly global supply chains, continue to impact domestic manufacturing of wind equipment. What they mean for wind power additions through the end of the decade and beyond will be dictated in part by future natural gas prices, fossil plant retirements, and policy decisions. At the same time, recent declines in wind energy costs and prices and the potential for continued technological advancements have boosted future growth prospects.

Key findings from this year’s Wind Technologies Market Report include:

click to enlarge

Installation Trends

• Wind power additions stalled in 2013, with only 1,087 MW of new capacity added in the United States and $1.8 billion invested. Wind power installations in 2013 were just 8% of those seen in the record year of 2012. Cumulative wind power capacity grew by less than 2% in 2013, bringing the total to 61 GW.

• Wind power represented 7% of U.S. electric-generating capacity additions in 2013. Overall, wind power ranked fourth in 2013 as a source of new generation capacity, standing in stark contrast to 2012 when it represented the largest source of new capacity in the United States. The 2013 result is also a notable departure from the six years preceding 2013 during which wind constituted between 25% and 43% of capacity additions in each year. Since 2007, wind power has represented 33% of all U.S. capacity additions, and an even larger fraction of new generation capacity in the Interior (54%) and Great Lakes (48%) regions. Its contribution to generation capacity growth over that period is somewhat smaller in the West and Northeast (both 29%), and considerably less in the Southeast (2%).

• The United States fell to sixth place in annual wind additions in 2013, and was well behind the market leaders in wind energy penetration. After leading the world in annual wind power additions from 2005 through 2008, and then narrowly regaining the lead in 2012, in 2013 the United States represented only 3% of global additions. In terms of cumulative capacity, the United States remained the second leading market. A number of countries are beginning to achieve high levels of wind penetration: end-of-2013 installed wind power is estimated to supply the equivalent of 34% of Denmark’s electricity demand and approximately 20% of Spain, Portugal and Ireland’s demand. In the United States, the wind power capacity installed by the end of 2013 is estimated, in an average year, to equate to nearly 4.5% of electricity demand.

click to enlarge

• California installed the most capacity in 2013 with 269 MW, while nine states exceed 12% wind energy penetration. New large-scale wind turbines were installed in thirteen states, and Puerto Rico, in 2013. On a cumulative basis, Texas remained the clear leader. Notably, the wind power capacity installed in Iowa and South Dakota supplied 27% and 26%, respectively, of all in-state electricity generation in 2013, with Kansas close behind at more than 19%. In six other states wind supplied between 12% and 17% of all in-state electricity generation in 2013.

• No commercial offshore turbines have been commissioned in the United States, but offshore project and policy developments continued in 2013. At the end of 2013, global offshore wind capacity stood at roughly 6.8 GW, with Europe being the primary locus of activity. No commercial offshore projects have been installed in the United States, and the emergence of a U.S. market faces both challenges and opportunities. Strides continued to be made in the federal arena in 2013, both through the U.S. Department of the Interior’s responsibilities with regulatory approvals (the first competitive leases were issued in 2013) and the U.S. Department of Energy’s (DOE’s) investments in offshore wind energy research and development, including funding for demonstration projects. Navigant, meanwhile, has identified 14 projects totaling approximately 4.9 GW that are somewhat more advanced in the development process. Two of these have signed power purchase agreements (PPAs), and both sought to commence construction in 2013 in order to qualify for the federal tax credits.

• Data from interconnection queues demonstrate that a substantial amount of wind power capacity is under consideration. At the end of 2013, there were 114 GW of wind power capacity within the transmission interconnection queues reviewed for this report. 95% of this capacity is planned for Texas, the Midwest, Southwest Power Pool, PJM Interconnection, the Northwest, the Mountain region, and California. Wind power represented 36% of all generating capacity within these queues at the end of 2013, higher than all other generating sources except natural gas. In 2013, 21 GW of gross wind power capacity entered the interconnection queues, compared to 42 GW of natural gas and 11 GW of solar. Of note is that the absolute amount of wind, coal, and nuclear power in the sampled interconnection queues has generally declined in recent years, whereas natural gas and solar capacity has increased.

click to enlarge

Industry Trends

• GE captured 90% U.S. market share in a slow 2013. Siemens came in a distant second, with 8% of the 2013 buildout. Globally, Vestas recaptured the mantle of top supplier, while GE dropped to the fifth spot. Chinese turbine manufacturers continue to occupy positions of prominence in the global ratings, with eight of the top 15 spots. To date, however, their growth has been based almost entirely on sales to the Chinese market; Sany was the only Chinese manufacturer to install turbines (just 8 MW) in the United States in 2013.

• The manufacturing supply chain experienced substantial growing pains. With recent cost-cutting moves, the profitability of turbine suppliers rebounded in 2013, after a number of years in decline. Five of the 10 turbine suppliers with the largest share of the U.S. market had one or more domestic manufacturing facilities at the end of 2013. Nine years earlier there was only one active utility-scale turbine manufacturer assembling nacelles in the United States. Domestic nacelle assembly capability stood at roughly 10 GW in 2013, and the United States also had the capability of producing approximately 7 GW of blades and 8 GW of towers annually. Despite the significant growth in the domestic supply chain over the last decade, prospects for further expansion have dimmed. More domestic wind manufacturing facilities closed in 2013 than opened. Additionally, the entire wind energy sector employed 50,500 full-time workers in the United States at the end of 2013, a deep reduction from the 80,700 jobs reported for 2012. With significant wind installations expected in 2014 and 2015, turbine orders have now rebounded. But, with uncertain demand after 2015, manufacturers have been hesitant to commit additional resources to the U.S. market.

click to enlarge

• Despite challenges, a growing percentage of the equipment used in U.S. wind power projects has been sourced domestically since 2006-2007. Trade data show that growth in installed wind power capacity has outpaced growth in selected, tracked wind equipment imports since 2006-2007. As a result, a decreasing percentage of the equipment (in dollar- value terms) used in wind power projects has been imported, when focusing on selected trade categories. When presented as a fraction of total equipment-related wind turbine costs, the combined import share of wind equipment tracked by trade codes (i.e., blades, towers, generators, gearboxes, and wind-powered generating sets) is estimated to have declined from nearly 80% in 2006–2007 to approximately 30% in 2012–2013; the overall import fraction is considerably higher when considering equipment not tracked in wind-specific trade codes. Domestic content has increased and is relatively high for blades, towers, and nacelle assembly; domestic content is considerably lower for much of the equipment internal to the nacelle. Exports of wind-powered generating sets from the United States have increased, rising from $16 million in 2007 to $422 million in 2013.

• The project finance environment held steady in 2013. In a relatively lackluster year for project finance, both tax equity yields and debt interest rates were essentially unchanged in 2013. Financing activity is likely to pick up in 2014 based on the number of projects with signed power purchase agreements that will need to achieve commercial operations in 2014 and 2015 in order to stay within the PTC safe harbor guidelines provided by the IRS. Investors seem confident that sufficient capital will be available to finance this expansion. Perhaps the most notable development in 2013 (and persisting into 2014) is that several large project sponsors—including NRG, Pattern, and most recently NextEra—spun off so-called “yieldcos” as a way to raise capital from public equity markets. These “yieldcos” hold a subset of each sponsor’s operating projects, and pay out the majority of cash revenue from long-term electricity sales.

click to enlarge

• Independent power producers own 95% of the new wind capacity installed in 2013. Moreover, on a cumulative basis considering all wind installed in the United States by the end of 2013, independent power producers (IPPs) own 83% of wind power capacity, while utilities own 15%, with the final 2% owned by entities that are neither IPPs nor utilities (e.g., towns, schools, commercial customers, farmers).

• Long-term contracted sales to utilities remained the most common off-take arrangement, but merchant projects may be regaining some favor, at least in Texas. Electric utilities continued to be the dominant off-takers of wind power in 2013, either owning (4%) or buying (70%) power from 74% of the new capacity installed last year. Merchant/quasi-merchant projects accounted for another 25%, and that share may increase in the next two years as wind energy prices have declined to levels competitive with wholesale market price expectations in some regions, most projects currently under construction will come online this year or next in order to stay within the IRS safe harbor with respect to the PTC, and wind power purchase agreements remain in short supply. On a cumulative basis, utilities own (15%) or buy (54%) power from 69% of all wind power capacity in the United States, with merchant/quasi-merchant projects accounting for 23% and competitive power marketers 8%.

click to enlarge

Technology Trends

• Turbine nameplate capacity, hub height, and rotor diameter have all increased significantly over the long term. The average nameplate capacity of newly installed wind turbines in the United States in 2013 was 1.87 MW, up 162% since 1998–1999. The average hub height in 2013 was 80 meters, up 45% since 1998-1999, while the average rotor diameter was 97 meters, up 103% since 1998–1999.

• Growth in rotor diameter has outpaced growth in nameplate capacity and hub height in recent years. Rotor scaling has been especially significant in recent years, and more so than increases in nameplate capacity and hub heights, both of which have seen a modest reversal of the long-term trend in the most recent years. In 2012, almost 50% of the turbines installed in the United States featured rotors of 100 meters in diameter or larger. Though 2013 was a slow year for wind additions, this figure jumped to 75% in that year.

• Turbines originally designed for lower wind speed sites have rapidly gained market share. With growth in average swept rotor area outpacing growth in average nameplate capacity, there has been a decline in the average “specific power” i (in W/m2) among the U.S. turbine fleet over time, from 400 W/m2 among projects installed in 1998–1999 to 255 W/m2 among projects installed in 2013. In general, turbines with low specific power were originally designed for lower wind speed sites. Another indication of the increasing prevalence of lower wind speed turbines is that, in 2012, more than 50% of installations used IEC Class 3 and Class 2/3 turbines; in 2013, based on the small sample of projects installed that year, the percentage increased to 90%.

• Turbines originally designed for lower wind speeds are now regularly employed in both lower and higher wind speed sites, whereas taller towers predominate in lower wind speed sites. Low specific power and IEC Class 3 and 2/3 turbines, originally designed for lower wind speeds, are now regularly employed in all regions of the United States, and in both lower and higher wind speed sites. In parts of the interior region, in particular, relatively low wind turbulence has allowed turbines designed for low wind speeds to be deployed across a wide range of site-specific resource conditions. The tallest towers, on the other hand, have principally been deployed in lower wind resource areas, presumably focused on those sites with higher wind shear.

click to enlarge

Performance Trends

• Trends in sample-wide capacity factors have been impacted by curtailment and inter-year wind resource variability. Wind project capacity factors have generally been higher on average in more recent years (e.g., 32.1% from 2006–2013 versus 30.3% from 2000–2005), but time-varying influences—such as inter-year variations in the strength of the wind resource or changes in the amount of wind power curtailment—have tended to mask the positive influence of turbine scaling on capacity factors in recent years. Positively, the degree of wind curtailment has declined recently in what historically have been the most problematic areas, as a result of concrete steps taken to address the issue. For example, only 1.2% of all wind generation within ERCOT was curtailed in 2013; this was the lowest level of curtailment in Texas since 2007, and is down sharply from the peak of 17% in 2009.

• Competing influences of lower specific power and lower quality wind project sites have left average capacity factors among newly built projects stagnant in recent years, averaging 31 to 34 percent nationwide. Even when controlling for time-varying influences by focusing only on capacity factors in 2013 (parsed by project vintage), it is difficult to discern any improvement in average capacity factors among projects built after 2005 (although the maximum 2013 capacity factors achieved by individual projects within each vintage have increased in the past five years). This is partially attributable to the fact that average “specific power” remained largely unchanged from 2006–2009, before resuming its downward trend from 2010 through 2013. At the same time, the average quality of the wind resource in which new projects are located has declined; this decrease was particularly sharp—at 15%—from 2009 through 2012, and counterbalanced the drop in specific power. Controlling for these two competing influences confirms this offsetting effect and shows that turbine design changes are driving capacity factors significantly higher over time among projects located within a given wind resource regime.

• Regional variations in capacity factors reflect the strength of the wind resource and adoption of new turbine technology. Based on a sub-sample of wind projects built in 2012, average capacity factors in 2013 were the highest in the Interior (38%) and the lowest in the West (26%). Not surprisingly, these regional rankings are roughly consistent with the relative quality of the wind resource in each region, but also reflect the degree to which each region has, to this point, applied new turbine design enhancements (e.g., turbines with a lower specific power rating, or taller towers) that can boost project capacity factors. For example, the Great Lakes (which ranks second among regions in terms of 2013 capacity factor) has thus far adopted these new designs to a much larger extent than has the West (which ranks last).

click to enlarge

Cost Trends

• Wind turbine prices remained well below levels seen several years ago. After hitting a low of roughly $750/kW from 2000 to 2002, average turbine prices increased to more than $1,500/kW by the end of 2008. Wind turbine prices have since dropped substantially, despite continued technological advancements that have yielded increases in hub heights and especially rotor diameters. Recently announced turbine transactions have often been priced in the $900–$1,300/kW range. These price reductions, coupled with improved turbine technology and more-favorable terms for turbine purchasers, have exerted downward pressure on total project costs and wind power prices.

• Reported installed project costs continued to trend lower in 2013. The capacity-weighted average installed project cost within our limited 2013 sample stood at roughly $1,630/kW, down more than $300/kW from the reported average cost in 2012 and down more than $600/kW from the apparent peak in average reported costs in 2009 and 2010. With just 11 projects totaling 650 MW, however, the 2013 sample size is limited, perhaps enabling a few projects to unduly influence the weighted average. Early indications from a larger sample (16 projects totaling more than 2 GW) of projects currently under construction and anticipating completion in 2014 suggest that capacity-weighted average installed costs are closer to $1750/kW—still down significantly from 2012 levels.

• Installed costs differed by project size, turbine size, and region. Installed project costs exhibit some economies of scale, at least at the lower end of the project and turbine size range. Additionally, among projects built in 2013, the windy Interior region of the country was the lowest-cost region.

• Operations and maintenance costs varied by project age and commercial operations date. Despite limited data availability, it appears that projects installed over the past decade have, on average, incurred lower operations and maintenance (O&M) costs than older projects in their first several years of operation, and that O&M costs increase as projects age.

click to enlarge

Wind Power Price Trends

• Wind PPA prices have reached all-time lows. After topping out at nearly $70/MWh for PPAs executed in 2009, the national average levelized price of wind PPAs that were signed in 2013 (and that are within the Berkeley Lab sample) fell to around $25/MWh nationwide— a new low, but admittedly focused on a sample of projects that largely hail from the lowest- priced Interior region of the country. This new low average price level is notable given that installed project costs have not similarly broken through previous lows and that wind projects increasingly have been sited in lower-quality wind resource areas.

• The relative competitiveness of wind power improved in 2013. The continued decline in average levelized wind PPA prices (which embeds the value of federal incentives, including the PTC), along with a bit of a rebound in wholesale power prices, put wind back at the bottom of the range of nationwide wholesale power prices in 2013. Based on our sample, wind PPA prices are most competitive with wholesale power prices in the Interior region. The average price stream of wind PPAs executed in 2013 also compares favorably to a range of projections of the fuel costs of gas-fired generation extending out through 2040.

click to enlarge

Policy and Market Drivers

• Availability of Federal incentives for wind projects built in the near term has helped restart the domestic market, but policy uncertainty persists. In January 2013, the PTC was extended, as was the ability to take the 30% investment tax credit (ITC) in lieu of the PTC. Wind projects that had begun construction before the end of 2013 are eligible to receive the PTC or ITC. These provisions have helped restart the domestic wind market and are expected to spur capacity additions in 2014 and 2015. With the PTC now expired and its renewal uncertain, however, wind deployment beyond 2015 is also uncertain. On the other hand, the prospective impacts EPA’s proposal regulations to reduce carbon emissions from existing and new power plants may create new markets for wind energy.

• State policies help direct the location and amount of wind power development, but current policies cannot support continued growth at recent levels. As of June 2014, RPS policies existed in 29 states and Washington D.C. From 1999 through 2013, 69% of the wind power capacity built in the United States was located in states with RPS policies; in 2013, this proportion was 93%. However, given renewable energy growth over the last decade, existing RPS programs are projected to require average annual renewable energy additions of just 3–4 GW/year through 2025 (only a portion of which will be from wind), which is well below the average growth rate in wind capacity in recent years, demonstrating the limitations of relying exclusively on RPS programs to drive future deployment.

• Solid progress on overcoming transmission barriers continued. Over 3,500 miles of transmission lines came on-line in 2013, a significant increase from recent years. Four transmission projects of particular importance to wind, including the Competitive Renewable Energy Zones project in Texas, were completed in 2013. A decrease in transmission investment is anticipated in 2014 and 2015. Nonetheless, the wind industry has identified 15 near-term transmission projects that—if all were completed—could carry almost 60 GW of additional wind power capacity. The Federal Energy Regulatory Commission continued to implement Order 1000 in 2013, which requires public utility transmission providers to improve intra- and inter-regional transmission planning processes and to determine cost allocation methodologies for new transmission facilities. Despite this progress, siting, planning, and cost-allocation issues remain key barriers to transmission investment.

• System operators are implementing methods to accommodate increased penetration of wind energy. Recent studies show that wind energy integration costs are almost always below $12/MWh—and often below $5/MWh—for wind power capacity penetrations of up to or even exceeding 40% of the peak load of the system in which the wind power is delivered. Two recent integration studies include a detailed assessment of cycling costs. In both, cycling was found to increase with more renewables, though the associated costs were modest. Studies on frequency response with higher shares of wind highlight technical options to maintain adequate frequency response, including the potential participation of wind plants. Because federal tax incentives are available for projects that initiated construction by the end of 2013, significant new builds are anticipated in 2014 and 2015. Near-term wind additions will also be driven by the recent improvements in the cost and performance of wind power technologies, leading to the lowest power sales prices yet seen in the U.S. wind sector. Projections for 2016 and beyond are much less certain. Despite the lower price of wind energy and the potential for further technological improvements and cost reductions, federal policy uncertainty—in concert with continued low natural gas prices, modest electricity demand growth, and the aforementioned slack in existing state policies—may put a damper on growth.

Tweet

QUICK NEWS, August 26: CLIMATE MODELS PROVE RIGHT AGAIN; ABOUT INVESTING IN SOLAR; GM VS TESLA IN THE 200 MILE RACE

CLIMATE MODELS PROVE RIGHT AGAIN Unpacking unpaused global warming – climate models got it right; Global surface warming has slowed down due to internal and external factors, consistent with climate model predictions that account for these effects

Dana Nuccitelli, 25 August 2014 (UK Guardian)

"Although the global climate has continued to build up heat at an incredibly rapid rate, there has been a keen focus among climate contrarians and in the media on the slowdown of the warming at the Earth’s surface. The slowdown is in fact a double cherry pick – it focuses only on the 2% of global warming that heats the atmosphere (over 90% heats the oceans), and it only considers the past 10–15 years…[Nevertheless,] the latest IPCC report addressed it specifically:...‘The long-term climate model simulations show a trend in global-mean surface temperature from 1951 to 2012 that agrees with the observed trend (very high confidence). There are, however, differences between simulated and observed trends over periods as short as 10 to 15 years (e.g., 1998 to 2012).’ …From 1998 through 2012…[it was estimated] that global surface temperatures had warmed by about 0.06°C, whereas the average climate model projection put the value at closer to 0.3°C. This apparent discrepancy only represented a tiny fraction of overall global warming…but it was nevertheless a challenge for climate scientists…[Recent studies show] the climate models are doing a pretty good job…” click here for more

click to enlarge

Tweet

ABOUT INVESTING IN SOLAR What You Need to Know Before You Invest in Solar Energy

Motley Fool, August 24, 2014 (NASDAQ)

"Solar energy is one of the greatest investing opportunities of our generation with well over a trillion dollars in annual market potential around the world. But with all that potential comes tremendous risk, particularly as new technologies emerge…[T]he cost of [silicon] technology has been reduced to a level that's now economically viable…[Thin-film technology and utility-scale technology] costs are too high…New solar technologies can make for great headlines but…the best bets are technologies that are tried and true…[Four keys for solar investing are…1. Make manufacturers prove it...2. Bet on cost reductions over technology improvements…3. Understand the risk a company is taking…4. Remember the bottom line…The solar industry has literally trillions of dollars in potential but with that potential comes risk…” click here for more

click to enlarge

Tweet

GM VS TESLA IN THE 200 MILE RACE The story of Elon Musk and GM’s race to build the first mass-market electric car

Steve Levine, August 25, 2014 (Quartz)

“One of the hottest clashes in technology pits two pathmakers in the new era of electric cars—Tesla and General Motors. Both are developing pure electrics that cost roughly $35,000, travel 200 miles on a single charge, and appeal to the mass luxury market…The stakes are enormous…Experts regard 200 miles as a tipping point, enough to cure many potential electric-car buyers of…the fear of being stranded when their battery expires. If GM and Tesla crack this, sales of individual electrics could jump from 2,000 or 3,000 vehicles a month to 15 to 20 times that rate…But there is a price to such distance. The 208-mile S starts at around $70,000…Getting 200 miles of range in a $35,000 car will require a battery that can leap over the best lithium-ion technology known to be within reach. And to be ready for 2017 or even 2018 models, it has to accomplish the jump with astonishing speed…Musk’s battery economics are superior…[and GM also] lacks the pizzazz, the style, and the engineering…This makes Musk the bettors’ favorite. Yet where Musk is gambling his company on the success of the Model 3, GM has options. It could ignore Tesla, and surrender the $30,000-$40,000 electric market, along with the technological crown that will go with it…and pull a winning, 200-mile automobile from the drawing boards of its design-and-engineering teams…[or] produce an entirely different, 200-mile car, one aimed at a lower demography, such as that served by its $14,000 Chevy Sonic… GM would arguably leapfrog over Musk, into the biggest mass market of all…” click here for more

click to enlarge

Tweet

TODAY’S STUDY: NEW CALMER WINDS AHEAD FOR EUROPE

Wind energy scenarios for 2020

July 2014 (European Wind Energy Association)

Background

EWEA’s previous wind energy scenarios were pub lished in 2009 (‘Pure Power 2’) following the adoption of the EU’s Renewable Energy Directive. They were subsequently re-published in 2011 (‘Pure Power 3’).

The scenarios looked at both annual and cumulative installations and included a country breakdown for 2020, but not for intermediate years. The headline figure was 230 GW (of which 40 GW offshore) producing 581 TWh of electricity, meeting 15.7% of electricity consumption. EU electricity consumption for 2020 was projected to be 3,689.5 TWh1.

click to enlarge

Reasons for the new scenarios

In light of developments since 2009, not least the economic European markets, EWEA has reviewed its 2020 scenarios according to present and expected realities. The European Commission now2 expects final power demand in 2020 to be 11% lower than it did in 2009 (2,956 TWh gross final consumption in EU27, instead of 3,336 TWh). In reality, therefore, the Commission does not expect EU power demand to increase above its 2008 peak until after 2020. This economic reality has had a impact on demand for new power installations for all generation technologies.

The economic reality has also fed through to the stability of regulatory and market frameworks for wind energy, both onshore and offshore. This has impacted investment plans, new orders, investment decisions already taken, and existing installations in markets across Europe. Retroactive and retrospective changes to regulatory and market frameworks have had a particularly negative impact on the wind energy sector, especially in certain markets.

click to enlarge

Proposed new scenarios

Given the expectations for energy demand, the persisting instability in numerous markets across Europe, the rapidly changing national policy frameworks for wind energy, the new round of climate and energy discussions at EU level on a policy framework to 2030, and the potential impact of the 2015 COP climate negotiations in Paris, it is apparent that a single growth scenario for wind energy is no longer sufficient.

Consequently, EWEA is proposing three growth scenarios to 2020. These are based on the premise that the instability experienced in wind energy markets to date is not fully compensated for by new installations in the latter half of the decade, particularly offshore. It does not necessarily follow that lower installations will undermine the EU’s 20% renewable energy target being met. As the 20% target is a consumption target, and with consumption in 2020 being lower than previously expected, meeting the target with fewer installed MW producing fewer TWh is feasible. EWEA’s new central scenario expects 192 GW of wind installations to produce 442 TWh meeting 14.9% of electricity consumption in 2020.4

The central scenario will result in cumulative installations over the seven year period of 75 GW and an investment volume in wind farms of between €90 billion and €124 billion, with the leading markets being Germany, France, the United Kingdom, Poland and Italy. By 2020, 354,000 people (up from 253,000 today) will be employed in the European wind industry.

click to enlarge

• Low scenario 2020

Installed capacity increases by 41% compared to 2013 to 165.6 GW. Offshore installations are 19.5 GW. Onshore wind installations produce 307 TWh of electricity and offshore installations 71.9 TWh. The combined wind energy production of 378.9 TWh covers 12.8% of total EU power demand.

The effects of the economic crisis on power demand linger, pressure on public spending persists across Europe until the latter years of the decade. Instability in national regulatory frameworks in both mature and emerging markets continues. This instability makes it difficult to attract financing for new wind energy projects, especially in the offshore sector that struggles to de-risk. EU and international climate and energy policy post-2020 decisions are weak and unambitious, providing few extra stimuli for wind energy development.

click to enlarge

• Central scenario 2020

Installed capacity increases by 64% compared to 2013 to 192.5 GW. Offshore installations reach almost 23.5 GW. Onshore wind installations produce 355.2 TWh of electricity and offshore installations 86.4 TWh. The combined wind energy production of 441.7 TWh covers 14.9% of total EU power demand. Regulatory stability is not fully recovered throughout Europe; however, in key onshore markets such as Germany, France, United Kingdom and Poland policy reforms are finalised rapidly and the new regulatory frameworks are conducive to a pick-up in wind power installations. EU post-2020 energy and climate negotiations provide some medium-term perspectives for the wind energy sector. Offshore installations are similar to those under the low scenario, but extra confidence in the UK and faster deployment in France and the Netherlands push the EU total to 23.5 GW.

click to enlarge

• High scenario 2020

Installed capacity increases by 84.9% compared to 2013 to 217 GW. Offshore installations almost reach 28 GW. Onshore wind installations produce 397.8 TWh of electricity and offshore installations 102.2 TWh. The combined wind energy production of 500 TWh covers 17% of total EU power demand. Regulatory stability returns to most markets in Europe with annual installation growth rates returning to pre-2012 levels. Agreement on a strong EU climate and energy package, proposing domestic greenhouse gas reductions of 40% in 2030 compared to 1990 levels and a renewable energy target of 30% boosts installations in a number of key markets such as Germany, France, Italy and the United Kingdom. As the effects of the economic crisis fade, markets that came to a virtual standstill in 2013, such as Spain, begin to show signs of growth. Offshore installations are similar to those of the central scenario, except in Belgium, Ireland and the UK where there is some extra growth. Germany’s offshore connection capacity of 7.7 GW is almost totally met.

Tweet

QUICK NEWS, August 25: JULY’S U.S. ENERGY BUILD WAS ALL NEW ENERGY; CLIMATE CHANGE FOR ENERGY INVESTORS; WIND CAN GROW FASTER THAN NUCLEAR

JULY’S U.S. ENERGY BUILD WAS ALL NEW ENERGY Renewable Energy Accounts For All New U.S. Power In July

August 20, 2014 (Renew Grid)

"All new U.S. electrical generating capacity put into service in July came from renewable energy sources…[including 379 MW of wind, 21 MW of solar and 5 MW of hydropower, according to the July 2014 Federal Energy Regulatory Commission (FERC)lEnergy Infrastructure Update]…For the first seven months of this year, renewables have accounted for more than half (53.8%) of the 4,758 MW of new U.S. electrical capacity that has entered service, with solar (25.8%) and wind (25.1%) each accounting for more than a quarter of the total. In addition, biomass provided 1.8%, geothermal 0.7% and hydropower 0.4%...natural gas accounted for 45.9%, while a small fraction (0.3%) came from oil and ‘other’ combined…[T]here has been no new electrical generating capacity from either coal or nuclear thus far in 2014…Renewable energy sources now account for 16.3% of total installed operating generating capacity in the U.S.: hydro - 8.57%, wind - 5.26%, biomass - 1.37%, solar - 0.75%, and geothermal steam - 0.33%...” click here for more

click to enlarge

Tweet

CLIMATE CHANGE FOR ENERGY INVESTORS Why Climate Change Could Be the Biggest Threat to Your Portfolio

Arjun Sreekumar, August 22, 2014

"…[C]limate change may be the biggest threat of all…[to] oil and gas companies' asset values and share prices…[W]e must limit emissions to no more than 900 gigatonnes of carbon dioxide (GtCO2) over the period 2013-2049 if we are to keep, at 80% probability, the global temperature from rising 2 degrees Celsius above pre-industrial levels…Meeting that emissions target means that the vast majority of the global fossil fuel reserves owned by energy companies and foreign governments cannot be burned...[Burning these reserves] would raise the global temperature by well over 3 degrees Celsius…[Even with allowances, companies like ExxonMobil, Chevron, Shell, and BP] could harvest no more than a third of their existing reserves…[A]out two-thirds of their reserves could be, at worst, worthless…[But the more likely case is that] we fail to act and end up exceeding the stated target…For investors, this means that your fossil fuel stocks are likely safe for the foreseeable future. But in the improbable event that global leaders somehow scrape together and enforce a carbon reduction plan, fossil fuel stocks could be in trouble. Caveat emptor…” click here for more

click to enlarge

Tweet

WIND CAN GROW FASTER THAN NUCLEAR Which Is More Scalable, Nuclear Energy Or Wind Energy?

Mike Barnard, August 22, 2014 (Forbes)

“China is the true experiment for maximum scalability of nuclear vs wind. It has a tremendous gap between demand and generation. It can mostly ignore democracy and social license for nuclear. It is building both wind and nuclear as rapidly as possible. It has been on a crash course for both for about the same period of time. It has bypassed most of the regulatory red tape for nuclear…[And] China turned on just over 16 GW of nameplate capacity of wind generation in 2013…[while over] the four years of 2010 to 2014, China managed to put 4.7 GW of nuclear into operation [at five plants. Their stated plans for nuclear] had them building almost double this in 2013 alone and around 28 GW by 2015…The variance between the nuclear roadmap and nuclear reality in China is following the trajectory of nuclear buildout worldwide: delays, cost overruns, and unmet expectations…Modern wind turbines have a median 40.35% capacity factor…[The nuclear capacity factor is] 90.9%...[T]hat’s about 6.5 GW of real capacity of wind energy in one year vs 4.3 GW of real capacity for nuclear over four years. That’s roughly six times more real wind energy capacity than nuclear per year…In empirical terms, it doesn’t matter what anybody claims is theoretically possible: wind energy is growing rapidly while nuclear is going backwards. That’s reality…” click here for more

click to enlarge

Tweet