Some Good News About Climate Change

Stick around for about 80 seconds to get the good news. From Years of Living Dangerously via YouTube

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Why The China-U.S. Climate Deal Is Big

This is huge for the folks working on a climate change solution called New Energy. Chalk up another huge triumph for President Obama. From PBS NewsHour

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Letterman Has Questions About Climate Change

A little about the difference between doing something and doing nothing. From Late Show with David Letterman

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KILLER WEATHER LIKELY TO BE MORE COMMON

Climate change: global weather predicted to become increasingly extreme despite warnings

Rose Troup Buchanan, 27 November 2014 (UK Independent)

“Global weather will become increasingly extreme, with the planet facing rising surfacing temperatures, higher sea levels and flash flooding…[T]he most vulnerable people, either elderly populations or those living in extreme poverty, will face increasing risk from shifting weather patterns, according [Resilience to Extreme Weather] by The Royal Society…From 1980 to 2004 the total cost of extreme weather came to – conservatively - $1.4 trillion…Of this sum, only one quarter was insured damage…And in the next 100 years top scientists explain this may only worsen. The impact of flooding is expected to quadruple - while boiling hot summers will increase 10-fold…[The report said the natural variability of global weather – and lack of detailed data available – indicated there might be…’unprecedented extremes, meaning that the past may not remain a good analogue for the future’…[and] the freak weather events, such as the British heatwave off 2003 which killed thousands of elderly and brought the country to a halt, may become more common…” click here for more

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CHINA NEW ENERGY REACHES FOR THE WORLD

How China Is Expanding Its Influence In Global Solar Market

Ucilia Wang, November 25, 2014 (Forbes)

“…While Chinese manufacturers, from those who make the components to the final assembly of solar panels, have to raise their prices or pay tariffs as a result of the trade cases, most of the major players have remained in business. Their own domestic market is booming thanks for government subsidies to promote solar energy generation…China’s recently announced plan to increase renewable energy use and cap carbon emissions by 2030 spells more opportunities…Chinese companies already make up eight of the top 10 solar panel makers worldwide. In recent years, Chinese companies that made their fortunes in non-solar business began to invest in solar manufacturing and project development not just within China but also abroad…[ China’s Overseas Investments In The Wind And Solar Industries] by the World Resources Institute showed that China has boosted its overseas investment…Countries that benefited from [Chins’s wind and solar] investments included the United States, Spain, Italy, South Africa and Bulgaria…” click here for more

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GLOBAL WIND INDUSTRY CONSOLIDATING

Concentration on consolidation…the future plans of seven of the world's leading wind developers show a clear trend towards partnerships and diversification.

Shaun Campbell, 27 November 2014 (Windpower Monthly)

“The gap between acquiring a likely looking site and commissioning a grid-connected wind farm is a big one, which is why all raw pipeline figures should come with a healthy dose of ifs and buts…[The picture emerging from the figures and] backed up by our examination of seven of the world's leading wind power developers…is one of consolidation, collaboration and diversification. Overwhelmingly, developers are concentrating what they already have in their portfolios, seeking partners to share risks and costs, and exploring emerging market sectors…[except for] China, where growth continues at a breakneck pace…A little under 30GW was added to the global pipeline in the first ten months of this year and China accounted for more than nine-tenths of it…[C]ommon threads emerge from [other developers’] plans for the future…[Economic and political stability] are in short supply in many parts of the world. The developed world has yet to recover from the fallout of the financial crash, while the undeveloped world lacks the infrastructure to facilitate the building of large-scale projects…[As a result, the pipeline] is still a long way short of the 1,500GW the Global Wind Energy Council (GWEC) counts in its moderate scenario for additions up to 2030.” click here for more

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LONDON CAR SERVICE GOES TO CHINESE PLUGS

BYD to Expand Electric-Car Leasing Deal With London Hire Service

November 27, 2014 (Bloomberg News)

“BYD Co. will lease 200 of its e6 electric cars to a London private-car service by April, the largest overseas rental agreement for the Chinese automaker that counts Berkshire Hathaway Inc. as a shareholder…BYD has delivered 32 of its e6 vehicles to London-based Thriev, which operates a chauffeur service using only electric cars…The company said it’s also working on plans to export e6 cars and electric buses to markets including Chicago and New York, without giving more details…Founded by billionaire Chairman Wang Chuanfu as a battery and handset-component maker, BYD has branched into manufacturing electric cars and has targeted selling its vehicles in the U.S. by next year. The company’s electric cars are used by taxi fleets in its hometown of Shenzhen, in southern China…BYD [also] beat France’s Renault SA and Japan’s Nissan Motor Co. in a tender to supply emission-free taxis [last month] in Brussels…” click here for more

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Fast Fun Facts About Thanksgiving

NewEnergyNews is so grateful to so many…beginning with the Marks family foundation…the inimitable Frenchie and the rambling Juliette…the enduring Randolph and the Scott clan…the guys at Akbar…the Cowboy Palace dancers…the Pasadena Untersehers…Teri in Austin…the staff at Utility Dive…the many folks who are building the infrastructure to harvest the power of this good earth’s wind, sun, deep heat, and flowing waters for sharing themselves and stories from the front lines of the fight they are winning…and, of course, the readers who keep clicking on this page…May you always count your blessings and may a kind fate lead you. From HistoryChannel via YouTube

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A Lesser Known Bit Of Thanksgiving History

This isn’t part of the official history of Thanksgiving but it probably should be. From jasonxgoodman via YouTube

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A Funky History Of Thanksgiving

Then there’s this version.From HotForWords via YouTube

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TODAY’S STUDY: A SUPPRESSED STUDY OF OHIO NEW ENERGY JOBS

Ohio Alternative Energy Job Survey Analysis

February 2013 (Prepared for Development Services Agency Office of Energy; Prepared by ICF International)

[Editor’s note: This study, reportedly suppressed during the 2013 debate over freezing Ohio’s renewables mandate, found there were approximately 25% more renewables jobs in Ohio than proponents of the freeze claimed. They subsequently were successful, apparently seriously crippling renewables in the state.]

Introduction

In response to a request by the Ohio Development Services Agency (formerly known as the Ohio Department of Development), ICF International (ICF) and Wright State University (WSU) conducted a renewable energy (RE) and energy efficiency (EE) job survey across the state. The purpose of the survey was to provide the Ohio Development Services Agency with data about current (2012) and projected alternative energy (AE) employment and establishments in Ohio. To contextualize that data, the survey also aimed to provide a better understanding of the characteristics of the AE economy by sector or value-chain and technology as well as to identify factors that promote market growth or barriers that inhibit AE-related business in Ohio. This report presents the results of the 2012 survey of AE employers. The report is organized into three sections: approach, findings, and conclusions. The approach section describes the survey methodology, and outlines any data limitations and the measures taken to compensate for them. The findings section is organized into three subsections, as follows:

1. current AE employment, by sector and technology;

2. projected AE employment; and

3. market and policy findings.

The report concludes with a summary of key findings and a discussion of employers’ views regarding a range of alternative energy policy considerations…

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Conclusions

Current Alternative Energy Employment

In 2012, Ohio’s alternative energy (AE) economy accounted for more than 31,000 full-time and part-time jobs and 845 establishments. The businesses and employees in this economy supported a variety of sectors, technologies, industries, and functions throughout the value chain.

The majority of AE employment in Ohio is concentrated in the manufacturing and the construction, installation, and maintenance sectors. These key sectors – or value chain functions— represent nearly 75 percent of all AE employment in Ohio. Manufacturing accounts for more than 43 percent of overall AE employment, and a particularly high proportion of employment in the advanced energy (69 percent), solar (58 percent), bioenergy and alternative fuels (52 percent) and other renewables (47 percent) industries’ workforces. The second largest concentration is in the construction, installation, and maintenance sector, which accounted for roughly 30 percent of AE jobs in the state. The research, design, consulting, and marketing services sector generally employs a lower percentage of each technology’s value chain than the other two sectors.

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In terms of energy technologies, roughly half of all jobs in Ohio’s alternative energy economy were located in the energy efficiency industry, with employment in the solar industry a distant second. Nearly 12,200 people were employed in energy efficiency, and these jobs were evenly distributed across manufacturing (34 percent); installation, maintenance, and power generation operations (36 percent); and research, design, consulting, and marketing (30 percent). Approximately 7,100 workers, or 29 percent of those employed in the AE economy, were employed in renewable energies (including solar, wind, biomass, and other renewables). Of these renewable energy technologies, solar was by far the most significant, accounting for 79 percent of renewable energy jobs, and 23 percent of all jobs in the AE economy.

Regionally, Ohio’s alternative energy jobs are concentrated in the northern portion of the state, with the northwest and northeast regions together accounting for more than half of all jobs in alternative energy. This trend closely follows the population concentration of Ohio; the two northern regions have higher populations than other regions in the state and have more overall jobs. In terms of establishment size, more than 85 percent of establishments in the alternative energy economy were classified as small (5-49 employees). That said, only half of all AE employees worked at these small establishments, while a third worked at the 27 largest-size establishments in the state (classified as 250 or more employees).

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Projected Employment Growth

According to survey responses, employers in all AE sectors and technologies anticipate job growth in the first half of 2013, with the majority taking place in the construction, installation, and maintenance sector and the professional services sector. Construction, installation, and maintenance jobs are expected to experience significant growth in terms of both percentage (38 percent) and gross jobs (4,400) during the first half of 2013 to add to their already-strong workforce of 11,500. The professional services sector is expected to grow by 62 percent from roughly 6,400 people in 2012 to more than 10,000 people in the first half of 2013. The manufacturing sector and biosciences sector will both grow at much slower rates in 2013; manufacturing by 9 percent and biosciences by only 5 percent. As a result of these trends, by the end of 2013, total employment in the construction, installation, and maintenance sector should surpass the manufacturing sector as the largest employment sector in the state’s AE economy.

In terms of energy technologies, employment growth will be centered in the energy efficiency and solar industries, where employers appear to be extremely optimistic about anticipated employment needs within the upcoming 6 to 12 months. The vast majority of Ohio’s AE job growth is expected to occur in the energy efficiency industry, with employers anticipating adding 3,900 new employees to their workforce of 12,200; a projected employment growth of approximately 32 percent. The solar industry anticipates adding 540 employees to their workforce of 5,600 people, which amounts to a growth rate of just below 10 percent. The remaining industries are anticipated to grow at much lower rates with year-over-year employment growth in bioenergy and alternative fuels, wind, and biomass not expected to exceed one percent in 2013.

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Market and Policy Factors Affecting Business Growth

Survey respondents were asked to rate a wide range of market factors, policies, and programs as either supporting or inhibiting the growth of their businesses. The two factors that were most highly ranked as being supportive to business growth—federal incentives and current market demand for products—fall largely outside of the state’s control. Approximately 45 percent of respondents believed that federal incentives supported business growth, suggesting that uncertainty associated with any extension or expiration of federal credits or programs (e.g. the Production Tax Credit), could have wide-ranging impacts on businesses. Current market demand for products was rated the second most supportive factor, with 41 percent of respondents rating current demand as benefitting their business.

Three factors that are within the state’s influence were also widely cited as supportive of business growth. Thirty-six percent of respondents felt that the current availability of workers with the necessary skills/knowledge was supportive of business growth, 36 percent cited state financing options (including grant and loan programs) as supportive, and 33 percent cited state alternative energy tax incentives.

The factors cited most frequently as inhibiting business growth include federal regulations (44 percent), state permits and environmental regulations (37 percent), current availability of workers with the necessary skills and knowledge (32 percent), and local permits and zoning (28 percent). Given that the availability of skilled workers was cited frequently as both a supportive and inhibiting factor, further analysis of the respondents who cited this factor as either supporting or inhibiting business growth may allow for a better understanding of which industries would most benefit from investments in worker training programs.

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Existing Ohio Programs and Policies

When asked specifically about the State of Ohio’s policies and programs, respondents generally believed that state’s current policies supported their businesses more than they impeded them. Even the most highly cited inhibitive factor—Ohio’s building energy codes—was cited as inhibiting business growth by a mere 7 percent of survey respondents. Given this, Ohio’s programs and policies for AE appear to be on the right track.

Nearly a third of respondents, 29 percent for both factors, believed that Ohio’s building energy codes and energy standards for public buildings supported business growth. These two policies likely affect the energy efficiency industry exclusively, and therefore may be a significant driver for this significant industry which accounts for half of all jobs in the AE economy. The Ohio AEPS, ODSA Energy Loan Fund, and other ODSA programs were all cited by between 10-15 percent of respondents as supportive of business growth, whereas Ohio’s net metering regulations and renewable energy permitting standards were cited by only 9 percent of respondents. Respondents generally did not feel that Ohio’s policies inhibited their business growth. No particular policy was cited significantly more than others as being inhibitive of growth, and no option was selected by more than 7 percent of respondents.

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Potential Future Ohio Programs and Policies

When asked about their views regarding potential future policy changes or new policies and programs in the State of Ohio, roughly one-quarter of respondents felt that the following potential future programs and policies would support growth of their businesses:

 expansion of the Ohio AEPS (28 percent);

 assistance with project feasibility analysis (27 percent);

 assistance with market analysis (24 percent);

 and subprime financing for alternative fuel vehicles (23 percent).

At the same time, a large number of respondents felt that many of the potential future programs and policies would have “no presumed effect” on the growth of their business (note that this is different than inhibiting business growth). Approximately 44 percent of respondents believed that providing subprime financing for alternative fuel vehicles would not significantly affect their business, and 42 percent felt that establishing a low-carbon fuels standard would have no effect. This is likely because of the limited number of survey respondents in the alternative fuels/vehicles industry. The potential policy change least-cited by respondents as having no effect on business growth was an expansion of the state’s AEPS (23 percent), which is consistent with the fact that the AEPS was seen by many respondents as being highly supportive of alternative energy business growth.

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QUICK NEWS, November 26: WHY PEOPLE DENY CLIMATE CHANGE; THE FORCE OF SOLAR; POWER ELECTRONICS MARKETS TO BOOM

WHY PEOPLE DENY CLIMATE CHANGE Here's Why People Don't Believe In Climate Change

Natasha Bertrand, November 25, 2014 (Business Insider)

“…[More than one-quarter of Americans] don't believe that the planet Earth's climate is changing, even though 97% of scientists believe it is…[The] most common response was that they had not noticed a change in the weather around them, and that the weather was actually getting colder where they lived [according to Believers, Sympathizers, & Skeptics from the Public Religion Research Institute and the American Academy of Religion]…The second most common response was that temperatures are not rising because of human actions, instead they are just fluctuating as part of a larger natural cycle…[though] there is plenty of evidence that humans have contributed to changes in global temperatures…The third most popular response, with 12% of deniers selecting it, is that there is not enough scientific evidence…A small minority of skeptics (4%) responded that they have alternative theories…2% said they believe God is in control and 5% believe [it is all propaganda]…” click here for more

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THE FORCE OF SOLAR Solar power charging ahead in America

Trevor Hughes, November 24, 2014 (USA Today)

“America is building so much solar power that 10% of the country's energy needs could be generated by the sun in 15 years…[though the country presently] gets less than 1% of its energy from the sun. But the country also tripled its solar generation capacity in three years, and increased it tenfold from 2007 to 2013 [according to Star Power from Environment America]… Solar installations come in many forms, from the small panels installed above streetlights in New Jersey to the backyard panels serving homes in Vermont or the cooperative solar ‘farms’ built in the desert canyons of Colorado…Solar fans say the sun's energy is cleaner than burning fossil fuels, which contribute to climate change, and can be installed in every state…The report says the country's rapid increase in solar installations is due in large part to individual states' efforts…Last year alone, California helped customers install 620 megawatts of solar power, a 73% increase from a year earlier...[T]he rapid increase in installations has driven costs down faster than anyone expected…” click here for more

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POWER ELECTRONICS MARKETS TO BOOM Power Electronics Market to Rise 77% to $23 Billion for Discrete Components in 2024; Silicon will remain predominant with an 87% share, but new SiC and GaN technologies will be the fastest-growing – at 30% and 32% annual rates respectively…

November 19, 2014 (Lux Research)

“Power electronics – used to convert and manage electricity in devices ranging from mobile phones to pumps and motors – will grow to a market worth $23 billion for discrete components in 2024, up from $13 billion today according to Sizing-up the $23 Billion Discrete Power Electronics Market in 2024 from Lux Research…Consumer electronics and IT will account for 48% of the market in 2024, or about $11 billion… The transportation market, worth nearly $1.2 billion in 2024, will be the big driver for both SiC and GaN…[but] SiC and GaN remain a small total share of the market. For SiC, high costs will make SiC transistors less viable in many applications, while GaN's adoption will be held back by delayed product roll-outs and capacity expansions…” click here for more

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TODAY’S STUDY: THE DOE LOAN PROGRAM PAYS OFF

Investing In American Energy

November 2014 (Loan Programs Office)

Bridging The Clean Energy Financing Gap

LPO issues loans and loan guarantees to finance deployment of innovative energy projects and advanced technology vehicle manufacturing facilities in the United States. These projects and facilities are critical to moving the United States towards a clean energy future where it is a global leader in clean energy technology, which will create economic opportunities and address the threat of climate change.

Commercial banks and bondholders are often unwilling to finance the first few commercial-scale projects that use a new technology since there is not yet a history of credit performance or operation. As a result, the initial commercial deployment of new energy technology is often limited by a project developer’s inability to secure su cient long-term debt financing to build the project.

LPO was established to fill this critical role in the marketplace by financing the first deployments of a new technology to bridge the gap for commercial lenders. Once the technology is proven at commercial scale through the first few projects, the Department of Energy (DOE) stops providing financing and lets the private market take over.

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An Overview Of The LPO Portfolio

LPO works with the private markets to help deploy innovative clean energy technology and advanced technology vehicle manufacturing facilities. Every transaction supported by LPO is a public-private undertaking. While DOE issues loans and loan guarantees to provide the necessary debt financing for these projects, the project sponsor must provide significant project-level equity investments.

Equity invested from private sources must represent at least 20% of the total cost of every project, and usually represents more. DOE will not issue a loan or loan guarantee until substantial private equity support is committed.

LPO manages a portfolio comprising more than $30 billion of loans, loan guarantees, and conditional commitments covering more than 30 projects. These projects include some of the world’s most innovative and largest solar, wind, geothermal, biofuel, and nuclear facilities, as well as advanced technology vehicle manufacturing facilities in six states producing some of America’s best-selling vehicles. Overall, these loans and loan guarantees have resulted in more than $50 billion in total project investment.

Today, 20 projects supported by LPO are operational and generating revenue. These projects currently produce enough clean energy to power more than 1 million American homes (roughly the size of Chicago), have supported the manufacturing of more than 8 million fuel-e cient vehicles, and have avoided carbon pollution equivalent to taking more than 3 million cars on the road.

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Protecting Taxpayers And Delivering Results: The Strong Performance Of The LPO Portfolio

LPO was created to help finance innovation, which involves a degree of technology risk, so it structures its loans to protect taxpayer interests. For each transaction, LPO’s team of financial, technical, environmental and legal professionals conducts rigorous due diligence that is comparable to, if not more stringent than, what is done in the private sector.

The loans and loan guarantees issued by LPO are all structured to be fully repaid with interest over the term of the loan. Each project in the portfolio must begin repaying the principal and interest on its loan around the time it reaches completion. As many of LPO’s projects reached completion in the past two years, project revenues are being used to repay the loans.

As of September 2014, LPO-financed projects have already repaid nearly $3.5 billion of principal, as well as more than $810 million in interest payments to the U.S. Treasury, which issued the loans guaranteed by DOE through the Federal Financing Bank. These amounts will continue to increase as the loans are repaid over the coming years.

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Also, LPO estimates that project borrowers, based upon the amount disbursed to date, will make more than $5 billion in interest payments to the U.S. Treasury over the full term of the notes. Nevertheless, the risk of loss exists in any lending or investment activity and the performance of any financial portfolio is dynamic, as outstanding loans are repaid and new loans are issued. LPO manages this risk through thorough due diligence, underwriting, and portfolio monitoring, which has resulted in strong portfolio performance to date.

In the five years since LPO began financing projects, actual and estimated loan losses to the portfolio are less than $780 million or approximately 2% of the program’s loans, loan guarantees, and conditional commitments and less than 3.6% of the total funds disbursed to date.

With these actions, LPO is achieving its mission of accelerating the deployment of advanced energy technology, while protecting taxpayer interests.

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QUICK NEWS, November 25: THE PRESIDENT’S CLIMATE CHANGER; SOLAR AND WIND BEAT COAL, GAS ON PRICE; LED LIGHTING TO DISRUPT, TRANSFORM THE INDUSTRY

THE PRESIDENT’S CLIMATE CHANGER The Audacity Of John Podesta; He’s driving the White House’s go-it-alone climate strategy, but will any of it stick after the president is gone?

Ben Geman, November 22, 2014 (National Journal)

“…The Environmental Protection Agency is at the center of [the White House climate-change] agenda, with its controversial rule to limit carbon pollution from coal-fired power plants…[It is] the administration's stated intent to go around Congress on everything from energy to immigration. And [John] Podesta is elbow-deep in it…[That] has revived the Republican criticism that Obama has a penchant for handing lots of power to people who aren't vetted by or responsive to Congress…[Podesta] has been ambitious, [but] his approach both forceful and deliberate. And he's brought to the climate agenda a level of inside clout that has been missing…But whether he has created policy that is durable—regulations and initiatives not easily unwound by a freshly anointed GOP Congress or, after 2016, a Republican president—is far less certain.

“The White House knows this and is racing to get its new EPA rule well-enough rooted in the economy before Obama's term ends that any attempt to yank it up later would be prohibitively difficult...Podesta is on the clock, too…He has long had deep ties to Hillary Clinton, and a source close to her confirms that he's being considered for a senior role in her likely 2016 campaign…Everything shifted after Obama's reelection…[T]he White House released a broad climate policy blueprint, accompanied by…[a commitment] to imposing the long-awaited mandatory carbon-pollution standards on coal-fired power plants…To help the White House see this through…[Podesta agreed] to a short posting, which would include a strong focus on climate…[S]enior White House climate policy aide Dan Utech…credits Podesta with pushing forward the major pillars of the second-term plan…[I]ncoming Senate Majority Leader Mitch McConnell is promising to [do whatever is possible to] throw up roadblocks…” click here for more

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SOLAR AND WIND BEAT COAL, GAS ON PRICE Solar and Wind Energy Start to Win on Price vs. Conventional Fuels

Diane Cardwell, November 23, 2014 (NY Times)

The cost of electricity from wind and solar resources in some markets now beats coal and natural gas and the trend is accelerating, especially in the Great Plains and Southwest. The price of solar has fallen 70% since 2008 and the Midwest PPA price of wind fell over 50% in the last 5 years. Austin Energy recently completed a power purchase agreement (PPA) for solar at under $0.05 per kilowatt­hour. In Oklahoma, Grand River Dam Authority announced a PPA it said would save customers an estimated $50 million and American Electric Power tripled its wind acquisitions on the strength of low bids. Investment banking firm Lazard’s most recent levelized cost of energy (LCOE) analysis shows utility-­scale solar energy is as low as $0.056 per kilowatt­hour with subsidies and about $0.072 unsubsidized, wind is as low as $0.014 per kilowatt-hour with subsidies and $0.037 without, natural gas is $0.061 per kilowatt-hour, and coal is $0.06 per kilowatt-hour. The LCOE fails to include fossil fuel health and societal impacts, the economic impacts of fossil fuel price volatility or the increasing costs of climate change. For renewables, it fails to consider the costs to integrate variable resources into power markets. click here for more

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LED LIGHTING TO DISRUPT, TRANSFORM THE INDUSTRY Energy Efficient Lighting for Commercial Markets;LED, Fluorescent, HID, Halogen, and Incandescent Lamps and Luminaires in Commercial Buildings: Global Market Analysis and Forecasts

4Q 2014 (Navigant Research)

“The ongoing sea change between fluorescent and light-emitting diode (LED) lighting technologies amounts to a significant disruption for the lighting industry…Due to the much longer lifespan of LED lamps, Navigant Research expects overall revenue from lamp sales to decrease in the coming decade. To avoid this inevitable decline, companies are broadening their offerings by expanding to lighting controls and lighting services. Just like the tech giants (e.g., Hewlett-Packard and IBM) of decades past had to make the shift from hardware to software and services, today’s lighting giants are becoming providers of complete lighting solutions rather than just the physical elements that emit light. According to Navigant Research, global lamp revenue is expected to decline from $18.5 billion in 2014 to $12.8 billion in 2023…” click here for more

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TODAY’S STUDY: RUNNING OUT OF GAS

Drilling Deeper; A Reality Check on U.S. Government Forecasts for a Lasting Tight Oil & Shale Gas Boom

J. David Hughes, October 2014 (Post Carbon Institute)

Abstract

Drilling Deeper reviews the twelve shale plays that account for 82% of the tight oil production and 88% of the shale gas production in the U.S. Department of Energy’s Energy Information Administration (EIA) reference case forecasts through 2040. It utilizes all available production data for the plays analyzed, and assesses historical production, well- and field-decline rates, available drilling locations, and well-quality trends for each play, as well as counties within plays. Projections of future production rates are then made based on forecast drilling rates (and, by implication, capital expenditures). Tight oil (shale oil) and shale gas production is found to be unsustainable in the medium- and longer-term at the rates forecast by the EIA, which are extremely optimistic.

This report finds that tight oil production from major plays will peak before 2020. Barring major new discoveries on the scale of the Bakken or Eagle Ford, production will be far below the EIA’s forecast by 2040. Tight oil production from the two top plays, the Bakken and Eagle Ford, will underperform the EIA’s reference case oil recovery by 28% from 2013 to 2040, and more of this production will be front-loaded than the EIA estimates. By 2040, production rates from the Bakken and Eagle Ford will be less than a tenth of that projected by the EIA. Tight oil production forecast by the EIA from plays other than the Bakken and Eagle Ford is in most cases highly optimistic and unlikely to be realized at the medium- and long-term rates projected.

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Shale gas production from the top seven plays will also likely peak before 2020. Barring major new discoveries on the scale of the Marcellus, production will be far below the EIA’s forecast by 2040. Shale gas production from the top seven plays will underperform the EIA’s reference case forecast by 39% from 2014 to 2040, and more of this production will be front-loaded than the EIA estimates. By 2040, production rates from these plays will be about one-third that of the EIA forecast. Production from shale gas plays other than the top seven will need to be four times that estimated by the EIA in order to meet its reference case forecast.

Over the short term, U.S. production of both shale gas and tight oil is projected to be robust—but a thorough review of production data from the major plays indicates that this will not be sustainable in the long term. These findings have clear implications for medium and long term supply, and hence current domestic and foreign policy discussions, which generally assume decades of U.S. oil and gas abundance.

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Executive Summary – Key Findings

The seven tight oil plays and seven shale gas plays analyzed in this report account for 82% of projected tight oil production and 88% of projected shale gas production through 2040 in the EIA’s Annual Energy Outlook 2014 reference case forecast. A detailed analysis of well production data from these plays resulted in these key findings:

1) Tight oil production from major plays will peak before 2020. Barring major new discoveries on the scale of the Bakken or Eagle Ford, production will be far below EIA’s forecast by 2040.

a) Tight oil production from the two top plays, the Bakken and Eagle Ford, will underperform EIA’s reference case oil recovery by 28% from 2013 to 2040, and more of this production will be front-loaded than the EIA estimates.

b) By 2040, production rates from the Bakken and Eagle Ford will be less than a tenth of that projected by EIA.

c) Tight oil production forecast by the EIA from plays other than the Bakken and Eagle Ford is in most cases highly optimistic and unlikely to be realized at the rates projected.

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2) Shale gas production from the top seven plays will likely peak before 2020. Barring major new discoveries on the scale of the Marcellus, production will be far below EIA’s forecast by 2040.

a) Shale gas production from the top seven plays will underperform EIA’s reference case forecast by 39% from 2014 to 2040 period, and more of this production will be front-loaded than EIA estimates.

b) By 2040, production rates from these plays will be about one-third that of the EIA forecast.

c) Production from shale gas plays other than the top seven will need to be four times that estimated by EIA in order to meet its reference case forecast.

3) Over the short term, U.S. production of both shale gas and tight oil is projected to be robust—but a thorough review of the production data indicate that this will be unsustainable in the longer term.

These findings have clear implications for current domestic and foreign policy discussions, which generally assume decades of U.S. oil and gas abundance.

Other factors that could limit production are public pushback as a result of health and environmental concerns, and capital constraints that could result from lower oil or gas prices or higher interest rates. As such factors have not been included in this analysis, the findings of this report represent a “best case” scenario for market, capital, and political conditions.

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Tight Oil

The analysis shows that U.S. tight oil production cannot be maintained at the levels assumed by the EIA beyond 2020. The top two plays—Bakken and Eagle Ford—which account for more than 60% of current production, are likely to peak by 2017 and the remaining plays will make up considerably less of future production than has been forecast by the EIA. Rather than a peak in 2021 followed by a gradual decline to slightly below today’s levels by 2040, total U.S. tight oil production is likely to peak before 2020 and decline to a small fraction of today’s production levels by 2040.

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General Findings

• The 3-year average well decline rates in the seven plays analyzed for this report (which collectively provide 89% of current U.S. tight oil production) range from 60% to 91%.

• The high decline rates of tight oil wells in these plays means that 43% to 64% of their estimated ultimate recovery (EUR) is recovered in the first three years.

• Field declines from the Bakken and Eagle Ford are 45% and 38% per year, respectively (this compares to 5% per year for large conventional fields). This is the amount of production that must be replaced each year with more drilling in order to maintain production at current levels (field decline is made up of all wells in a play—old and new—and hence is lower than first-year well declines).

• Based on production history, drilling locations, and declining well quality, this report found that 98% of the EIA’s projected production from these seven plays has a “high” or “very high” optimism bias.

• The EIA assumes that the equivalent of 100% of proved reserves and between 65% and 85% of its “unproved technically recoverable tight oil resources” will be recovered by 2040 for the plays analyzed. Considering that unproved, technically recoverable resources have no price constraints and only loose geological constraints, this is highly speculative.

• The EIA assumes that the U.S. will exit 2040 with tight oil production at levels only marginally less than today, at 3.2 MMbbl/d. A thorough analysis of the well production data suggests this is highly optimistic.

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Forecasts for Bakken & Eagle Ford Tight Oil Plays

• The EIA’s forecast of the timing of peak production in the Bakken and Eagle Ford is similar to this report, as is the rate of peak production.

• The EIA forecasts a much higher tail after peak production, with recovery of 19.2 billion barrels between 2012 and 2040, as opposed to 13.9 billion barrels forecast in this report.

• The EIA forecasts collective production from the Bakken and Eagle Ford to be a little over 1 million barrels per day in 2040. In contrast, the “Most Likely” drilling rate scenario presented in this report forecasts that production will fall to about 73,000 barrels per day by 2040.

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Forecasts of Other Tight Oil Plays

• To meet the EIA’s forecasts, all other plays together would need to produce over twice as much through 2040 as what is projected for the Bakken and Eagle Ford.

• The major remaining tight oil plays are the three Permian Basin plays—Spraberry, Wolfcamp, and Avalon/Bone Spring—plus the Austin Chalk and the Niobrara. EIA forecasts expect these plays to produce four to five times their historical production in the next 26 years, but this is highly questionable, considering that:

- These plays are already 40-60 years old, with tens of thousands of wells already drilled.

- The Permian Basin plays’ average initial well productivities are half or less the average of core counties in the Bakken or Eagle Ford.

- The Bakken and Eagle Ford’s average estimated ultimate recovery (EUR) per well is two to more than six times higher than that of these other plays.

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Shale Gas

The EIA now projects domestic gas production to reach nearly 38 trillion cubic feet per year by 2040, which is 55% above 2013 levels. The bulk of this production growth would come from shale gas.

This analysis shows that simply maintaining U.S. shale gas production in the medium term—let alone increasing production at rates forecast by the EIA through 2040—will be problematic. Four of the top seven shale gas plays are already in decline. Of the major plays, only the Marcellus, Eagle Ford, and Bakken (the latter two are tight oil plays producing associated gas) are growing; and yet, the EIA reference case gas forecast calls for plays currently in decline to grow to new production highs, at moderate future prices. Although significantly higher gas prices needed to justify higher drilling rates could temporarily reverse decline in some of these plays, the EIA forecast is unlikely to be realized.

General Findings

• The 3-year average well decline rates in the seven plays analyzed for this report (which collectively provide 88% of U.S. shale gas production) ranges between 74% and 82%.

• The average field decline rates for these plays ranges between 23% and 49%, meaning that between one-quarter and one-half of all production in each play must be replaced each year in order to simply maintain current production.

• Although the EIA forecast for the Marcellus play is rated as “reasonable” and its forecast for the Bakken play is rated “conservative,” the deficit left by being “very highly optimistic” on some of the other plays makes finding and developing the gas required to meet the overall forecast unlikely.

• Because productivity of shale wells declines rapidly, many new wells must be drilled just to maintain existing production levels. Of the top shale gas plays, only the Marcellus, Eagle Ford, and Bakken are currently seeing enough drilling to maintain and grow production.

• Major shale gas plays are variable in well quality. The Marcellus and Haynesville are much more productive on average than the other plays analyzed in this report. Even within plays, well quality varies considerably.

• Despite years of concerted efforts and claims that technological innovation can overcome steep well decline rates and the move from “sweet spots” to lower quality parts of plays, average well productivity has gone flat in all major shale gas plays except the Marcellus.

• Approximately 130,000 additional shale gas wells will need to be drilled by 2040 to meet the projections of this report, on top of the 50,000 wells drilled in these plays through 2013. Assuming an average well cost of $7 million, this would require $910 billion of additional capital input by 2040, not including leasing, operating, and other ancillary costs.

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Forecasts for Shale Gas Plays

• The EIA assumes that 74% to 110% of its “unproved technically recoverable resources” plus “proved reserves” will be recovered by 2040 for the seven major plays analyzed. Considering that unproved, technically recoverable resources have no price constraints and only loose geological constraints, this is highly speculative.

• This analysis found that the EIA reference case forecast for the top seven shale gas plays overestimates cumulative production through 2040 in this report’s “Most Likely” scenario by 64%.

• The EIA further estimates that in 2040, shale gas production from the seven plays analyzed will be 182% higher (nearly 3 times) than estimated in this report—and that by 2040, another 49.6 Tcf will have been recovered from other plays not analyzed in this report.

• In this report’s “Most Likely” scenario, cumulative dry shale gas production over the 2014-2040 period is 229.5 trillion cubic feet (Tcf)—46% lower than the EIA Reference Case (377 Tcf).

• In this report’s “Most Likely” scenario, shale gas production from the seven plays analyzed peaks in the 2016-2017 timeframe and declines by more than half, to 14.8 billion cubic feet per day (Bcf/d) by 2040. In contrast, the EIA expects production from these plays to keep growing through 2040, with shale gas production in that year at 41.8 Bcf/d—nearly three times higher than this report finds justifiable.

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Implications

This report shows that the EIA’s optimistic forecasts for future U.S. tight oil and shale gas production are based on a set of false premises, namely that:

• High-quality shale plays are ubiquitous, and there will be always be new discoveries and production from emerging plays to fill the gap left by declining production from major existing plays.

• Technological advances can overcome steep decline rates and declining well quality as drilling moves from sweet spots to poorer quality rock, in order to maintain high production rates.

• Large estimated resources underground imply high and durable rates of extraction over decades. Actual production data from the past decade of shale gas and tight oil drilling clearly do not support these assumptions. Unfortunately, the EIA’s rosy forecasts have led policymakers and the American public to believe a number of false promises:

• That cheap and abundant natural gas supplies can create a domestic manufacturing resurgence and millions of new jobs over the long term.15

• That abundant domestic oil and natural gas resources justify lifting the oil export ban (imposed 40 years ago after the Arab oil embargo) 16 and fast-tracking approval of liquefied natural gas (LNG) export terminals.

• That the U.S. can use its newfound energy strength to shift geopolitical trends in our long-term favor.

• That we can easily limit carbon dioxide emissions from power plants as a result of natural gas replacing coal as the primary source of electricity production. The promises associated with the expectation of robust and relatively cheap shale gas and high-cost but rising tight oil production have also led to a tempering of investments in renewable energy and nuclear power. If, as this report shows, these premises and promises are indeed false, the implications are profound. It calls into question plans for LNG and crude oil exports and the benefits of the shale boom in light of the amount of drilling and capital investment that would be required, along with the environmental and health impacts associated with it. Conventional wisdom holds that the shale boom will last for decades, leaving the U.S. woefully unprepared for a painful, costly, and unexpected shock when the shale boom winds down sooner than expected. Rather than planning for a future where domestic oil and natural gas production is maintained at current or higher levels, we would be wise to harness this temporary fossil fuel bounty to quickly develop a truly sustainable energy policy—one that is based on conservation, efficiency, and a rapid transition to distributed renewable energy production.

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QUICK NEWS, November 24: NEW ENERGY DOMINATES THE U.S. NEW BUILDS AGAIN; SIERRA CLUB, UNITED STEELWORKERS WANT WIND JOBS; THE ABUNDANCE OF SOLAR

NEW ENERGY DOMINATES THE U.S. NEW BUILDS AGAIN Wind Energy Provides Over Two-Thirds Of New U.S. Generating Capacity In October 2014; For Eighth Time In Past Ten Months Renewables Dominate New U.S. Electrical Generating Capacity

Ken Bossong, November 24, 2014 (Federal Energy Regulatory Commission/Sun Day)

"…[W]ind power provided over two-thirds (68.41%) of new U.S. electrical generating capacity in October 2014…[with five wind farms] accounting for 574 MW of new capacity…[S]even ‘units’ of biomass (102 MW) [were 12.16% of new capacity] and five units of solar (31 MW) [were 3.69% of new capacity] respectively…[T]hree units of natural gas [made up the remaining 132 MW and 15.73% of new capacity, according to the latest Energy Infrastructure Update report from the Federal Energy Regulatory Commission's (FERC) Office of Energy Projects]…

“…[F]or the eighth time in the past ten months, renewable energy sources (i.e., biomass, geothermal, hydropower, solar, wind) accounted for the majority of new U.S. electrical generation…Natural gas [led in April and August]…Renewable energy sources now account for 16.39% of total installed operating generating capacity in the U.S.: water - 8.44%, wind - 5.39%, biomass - 1.38%, solar - 0.85%, and geothermal steam - 0.33%. Renewable energy capacity is greater than that of nuclear (9.23%) and oil (3.97%) combined…” click here for more

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SIERRA CLUB, UNITED STEELWORKERS WANT WIND JOBS Congress must not let wind energy jobs blow away

Sierra Club Exec Dir Michael Brune and United Steelworkers Pres Leo Gerard, November 20, 2014 (The Hill)

"The winds that froze Americans a week after the midterm elections could [could be harnessed to create clean electrical power and family-supporting jobs and] help solve the problems voters told pollsters most concerned them – jobs and the economy…The wind industry currently employs more than 50,000 American workers…Wind energy creates good-paying jobs for the workers who build, maintain, and operate wind turbines, and who support operations…Over 500 U.S. manufacturing facilities – including some whose workers are represented by United Steelworkers – build components for wind turbines…

“Yet Congress has created a significant headwind for the industry by failing to renew a modest tax credit called the Wind Production Tax Credit or PTC. The PTC slightly narrows the huge divide that separates wind and subsidized traditional fuels…[Many Congressional opponents of the PTC get contributions from] Koch Industries, led by Charles and David Koch. The pair of billionaire right-wing activists has fought against the PTC through their advocacy group Americans for Prosperity…Congress has a narrow window of opportunity to extend the PTC, and if they take it, we expect it to pass with a strong bipartisan vote…We urge Congress to continue to invest in a future…” click here for more

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THE ABUNDANCE OF SOLAR Report: America could power itself 100 times over with solar energy

Chris Mooney, November 20, 2014 (The Washington Post)

"…Staggering amounts of solar radiation strike the Earth each day; the only trick is capturing more of it…[ An Environment America Research and Policy Center report...argues that the U.S…[can] produce more than 100 times as much electricity from solar PV and concentrating solar power (CSP) installations as the nation consumes…[and] every single state could generate more solar electricity than its residents currently consume…[The map] was created by comparing technical estimates of solar potential from the National Renewable Energy Laboratory with state level electricity sales data from the Energy Information Administration…35 million homes and businesses could potentially install solar on their roofs…[Not] all of this solar potential will necessarily ever be exploited…[We] only need to exploit some of it…” click here for more

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Much More Inhofe Now

Fact: The most adamant climate denier in the U.S. Senate will now run one of the most important committees on the environment in the U.S. Senate. From greenmanbucket via YouTube

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Jon Stewart Talks Keystone, Politics, And Jobs

The best research concludes the low jobs numbers are the most likely ones. From Comedy Central

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Jon Stewart On How Keystone Opponents May Be Caught In Their Own Trap

Have Keystone proponents hoisted themselves on their own petard? From Comedy Central

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A NEW WAY TO SEE CLIMATE CHANGE

NASA Computer Model Provides a New Portrait of Carbon Dioxide

Patrick Lynch, November 17, 2014 (NASA)

“An ultra-high-resolution NASA computer model has given scientists a stunning new look at how carbon dioxide in the atmosphere travels around the globe…Plumes of carbon dioxide in the simulation swirl and shift as winds disperse the greenhouse gas away from its sources. The simulation also illustrates differences in carbon dioxide levels in the northern and southern hemispheres and distinct swings in global carbon dioxide concentrations as the growth cycle of plants and trees changes with the seasons…[The simulation uses ground-based measurements of carbon dioxide and measurements from the Orbiting Carbon Observatory-2 (OCO-2) satellite. It is] the product of a new computer model [called GEOS-5] that is among the highest-resolution ever created…[and] is the first to show in such fine detail how carbon dioxide actually moves through the atmosphere…[It] is part of a simulation called a [Nature Run that] ingests real data on atmospheric conditions and the emission of greenhouse gases and both natural and man-made particulates…[and runs on its own to simulate] the natural behavior of the Earth’s atmosphere. This Nature Run simulates May 2005 to June 2007…” click here for more

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EU OCEAN WIND TO CUT COSTS, KEEP GROWING

Offshore wind industry races to cut costs as subsidies drop

Christoph Steitz and Geert De Clercq with Pravin Char, November 17, 2014 (Reuters)

“…Britain, Germany and the Netherlands, wary of committing billions of euros when budgets are tight, have announced subsidy cuts in the past 18 months - a blow to the European offshore wind industry which [provides 1$ of European electricity and] employs nearly 60,000 people…[The European Wind Energy Association (EWEA) has reduced] its forecasts for installed offshore capacity in Europe to about 25 gigawatts (GW) by 2020 [about 3% of Europe’s electricity], from a 2009 forecast for 40 GW, still more than triple current capacity of about 7 GW…[U]tilities remain keen to invest…[in] the fastest-growing power technology in Europe…Unlike onshore farms, marine parks face less opposition from civil groups…[and] turn about 42 percent of the time, about double the ‘load factor’ onshore…[But] offshore parks [cost about 125 euros per megawatt hour (MWh), versus 80 euros for onshore wind,] and as the industry seeks to weather the subsidy cuts until investments pay off, companies are desperately seeking to reduce construction costs by building bigger, more efficient turbines and finding cheaper ways to construct foundations…” click here for more

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COST-COMPETIVE NEW ENERGY, GERMANY’S 'GIFT TO THE WORLD’

Thank Germany for Falling Prices of Solar Panels and Wind Turbines

Harold L. Sirkin, November 18, 2014 (Bloomberg BusinessWeek)

“…[N]early 30 percent of Germany’s electric power comes from renewable energy sources, and the percentage is growing. This is not without a downside: Traditional electric utilities are struggling…[W]ith Russia supplying a reported 38 percent of its natural gas imports, 35 percent of its imported oil, and a quarter of its imported coal, Germany made a wise decision to move in new directions—generating electricity from wind and sun, renewable energy sources that the U.S. has been much slower to adopt…[ All the world will benefit from] Germany’s embrace of wind and solar power…[because the huge demand it created] for wind turbines and especially for solar panels…helped lure big Chinese manufacturers into the market…driving down costs faster than almost anyone thought possible just a few years ago…[If politicians leave things up to the market to sort out, the U.S. and other countries will inevitably move in Germany’s direction, as renewable energy becomes more cost-competitive. That, German analyst Markus Steigenberger told the [NY] Times, will be Germany’s ‘gift to the world.’” click here for more

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NEW ENERGY MATCHES COAL ON COST, CAPACITY IN TURKEY

Turkey: Growing electricity demand can be met by renewables at the same cost as coal…

Zachary Davies Boren, November 14, 2014 (Greenpeace)

"Turkey could use clean energy instead of coal generation to achieve its twin aims of growing power supply and reducing natural-gas imports at roughly the same cost…[ Turkey’s Changing Power Market from Bloomberg New Energy Finance outlines] how nearly half of the country’s power demand could be met by renewable energy by 2030 in a scenario with costs comparable to the $400 billion coal-led strategy currently in place…According to the government’s plan, Turkey’s electricity demand will grow by more than 5% a year for the next 15, with coal capacity, as well as some wind and nuclear, expanding while gas power is put out to pasture…BNEF research, funded by the European Climate Foundation, commissioned by WWF-Turkey … states that the government’s projections for future power demand are inflated — and the increasing affordability of solar and wind energies represents a legitimate opportunity to introduce a modern, low carbon energy infrastructure…Bloomberg's Renewables Development Pathway (RDP) scenario would see gas generation fall by almost 20 points to 26% by 2030, coal drop to 18%, and renewables rise from 29% to an astonishing 47%...[W]ind and solar energy [make] the most gains (55% and 30% of new installations till 2030) [and] the lion’s share of clean energy would be provided by hydroelectricity — much of which is already installed…The government’s official energy strategy…is set to cost $400 billion; the BAU scenario will cost about the same; and the far preferable RDP just $6 billion more…” click here for more

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TOP REPUBLICAN DROPS CLIMATE DENIAL

Top Republican bows to scientists on climate change

Stephen Stromberg, November 17, 2014 (Washington Post)

“…[T]he country’s debate on climate change has been stuck on whether the phenomenon is happening at all, or on whether humans are responsible for it…and key GOP leaders still seem unwilling to move the discussion forward now…[but] comments from Sen. John Thune (R-S.D.)…offer a glimmer of hope that at least some Republicans aren’t comfortable with their party’s role…Asked about the overwhelming agreement among experts on the cause and trajectory of global warming, Thune [said:] ‘There are a number of factors that contribute to that, including human activity. The question is, what are we going to do about it and at what cost?’…[T]he number-three Republican in the Senate admitted that human activity is affecting the climate and that this concern demands a policy response…

“…[T]he answer to the last question should be relatively simple for honest conservatives: The efficient, market-friendly approach to cutting dependence on greenhouse gases is pricing carbon dioxide emissions and allowing market forces to adapt the economy…Thune didn’t go there…Republicans have to do more than simply acknowledge that there is a risk. His statement might be merely another GOP attempt to justify doing too little without seeming anti-science…[But it] points in a sure direction: It will be ultimately untenable for Republicans to admit that global warming is a legitimate concern yet reflexively attack efforts to deal with it…[The country can do better] than President Obama’s regulatory approach…only if more Republicans ask the right question — instead of continuing to dignify those who demand that their leaders dismiss and disdain scientists’ warnings.” click here for more

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FORD ELECTRIC CARS FOR ‘THE MASSES’

Ford To Make Electric Cars 'Attainable To The Masses;' CEO Denies Rumors Ford Is Interested In Tesla

Kukil Bora, November 18, 2014 (International Business Times)

"…[Ford Motor Company] intends to mass-produce affordable electric vehicles [according to CEO Mark Fields]…[He] emphasized that Ford has [a full line of electric vehicles that have performed well in the market place and] the capability to make electric cars with a strategy different from that of Tesla Motors…[that will] produce reasonably priced electric cars…Fields also said that Ford is not interested in buying Tesla, despite ongoing speculation that both Ford and General Motors Company are keen to [do so]…While Ford is currently ranked second in terms of sales in the electric car industry, the company’s Ford Focus was recently ranked as the most fuel-efficient compact car in the U.S…[ Fields said] Tesla’s approach is to cater to a high-end consumer…[but Ford will] nmake electrified vehicles ‘attainable to the masses’…” click here for more

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