Mark's Comments

"negative pricing situation in which BPA would pay California utilities"

Should anyone really be subsidizing generation when the price of power is negative? and if so who should pay for the subsidy?

Not only is it wrong in the first place to encourage additional generation during hours when additional power is worthless, this ruling now transfers the burden for the subsidy payment from the state to the BPA rate payers.

BPA has the legal right to curtail generation within its balancing authority. This is because BPA is under court order to do everything it can do to reduce TDG levels below 120%. The 120% value is based on NOAA Fisheries recommendation and the Biological Opinion which BPA follows in its hydro operations as prescribed by Judge Redden. If Pat Ford disagrees with the 120% TDG level, he should appeal to the court which directs BPA. BPA simply follows the court order. Environmental Redispatch is a legal tool BPA uses to limit excess spill during times when there is a lack of load.

This is not a transmission problem, it is a lack of market problem or oversupply of generation during off peak hours. If you are skeptical of this compare the enormous difference in system loads between Heavy Load Hours and Light Load Hours. Should rate payers really be encouraging this by incentivizing generation during off-peak hours when it has negative economic benefits to the region??? Wind generation during times of oversupply is worthless (negatively priced!) as well as detrimental to endangered species. AWEAs argument here just doesn't make any economic sense.

Obviously there is a tradeoff between hand-picking every funding award recipient, and handing the money out to any fool who applies. The tradeoff is between the length of delay for the stimulus and job creation, and the maximum value and long term benefit of the investments. So I think you can't have your cake and eat it too. It is apparent to me that the DOE has tried to take a middle ground here.

I like the idea of an economic solution like an oil tax and higer prices too. Energy prices are, and have been held artificially low for too long. Clean energy sources should be cheaper than dirty sources, though they are actually more expensive because the environmental costs aren't internalized into the prices we pay; not even close. I agree with Rich that the majority of people generally choose to buy the cheapest thing (whatever their political party) and we should not expect people to volunteer to pay higher prices for clean sources. I would expect people to slowly begin to adjust their usage habits slowly though maybe over decades, so for higher prices to begin to impact demand we would need to sustain higher prices on costly resources immediately extensively. A start would be to eliminate the oil subsidies which have been in place for a long time.

I think government is required to step in too regulate the higher prices. We cannot continue to rely on for profit companies to govern themselves because the decisions they make will never be alturistic.

The structure of our economy defines the components of the system, and is the most important consideration before implementing any new policies. If you think disaster relief "should" motivate our economy, first realize that is a motive hardly considered by most profit seeking businesses. I think we need to internalize external costs in the energy economy first. Paul Krugman recently cited some great ideas in this area in the New York Times: http://www.nytimes.com/2010/04/11/magazine/11Economy-t.html

Hendricks hit the nail on the head in discussing innovation, and looking forward instead of looking back for job creation. If the US doesn't lead the world in innovating new products, the rest of the world will leave us in their dust. We need to make real investments today in leading technologies to stay competitive. This process will create jobs and give us a chance to begin attacking the sustainability crisis faced by our global economy.

Most important is the feasibility of the technology which varies by region and by site. In Southern California distributed PV on Warehouses seems practical. Unless concentrated solar, or another centralized alternative is cheaper. If a 120MW project in New Jersey doesn't pencil out, then the investors shouldn't make any money and the utility shouldn't encourage any new projects under the same cost conditions. I like the policy of shifting the risk of a project away from the utility.

I would bet that my news sources vary from yours. How about looking at Oil Consumption, or Energy Usage over time? All of those emissions don't disappear. GHG levels raise temperature, and their atmospheric levels are increased by emissions, particularly CO2; that is not disputed.

There is concurrence by scientists that GHG levels are increasing at an increasing rate. Extrapolation is used in order to estimate what temperatures were in history, prior to accurate measurements being taken. That might be useful information to parametrize models, but it doesn't effect the general trend of the prediction.

sfortuna, are you saying more in not better? All of the problems you mentioned add to our GDP.

I agree that in the long term conservation may be only part of the problem if demand continues to increase as forecast. But in the short term it makes more sense to get the low hanging fruit first. The evidence I see, shows clearly that conservation is currently more cost effective than generation in $/kW*hr saved. It is a smart move to subsidize the most cost effective job creating measures.

What is the controversy about global warming? Are you saying that because temperature has varied in the past, greenhouse gasses aren't effecting our current temperatures? That is a non-scientific argument. I can see how politicians may shoot down these proposals for political reasons like localized job protection; but definitely not for scientific reasons.

I am an engineer in Oregon with 4 years of experience outside the energy field. I have been trying to find a job in renewables for over a year now. Iberdrola certainly hasn't created many new jobs within the US. Vestas is even worse. I suspect this is because both countries have corporate headquarters oversees. Looking back, I wish I had relocated to Texas or California right away.

Great analysis, I look forward to reading Hempling's article. How about a benefit to society for encouraging new generation technologies? Or conversely a cost-based analysis rooted in economies of scale, and projected decreasing future costs of new technologies over time? Maybe that kind of analysis would involve too many assumptions. I can see how restructuring the way the States evaluate distributed generation would be the most progressive solution.

It is great that universities are increasing research in this area, and publishing the results. Much of the information I had previously heard about biofuels, included claims from research about "black box" technologies that were hard to verify.

I haven't yet read the Nebraska-Lincoln study, but why do the numbers vary? Could the calculated energy return vary due differences the energy used for corn farming and harvesting? Or is the difference due to the energy quantities used for the hydrolysis, fermentation, and distillation processes? The research I have seen by Deutch at MIT shows that for gasohol, the energy output from gasohol is approximately 84,000 BTUs per gallon while the Energy input including production and conversion is 115,000 BTUs per gallon. At negative 31,000 BTUs per gallon, it is easy to conclude that ethanol doesn't yet make any economic sense as a substitute for gasoline.

I can see how carefully selected names from marketing and political perspectives greatly influence the public perception. I agree (with comment 2) that economics should also be a top ranking consideration. As someone who is unemployed and currently looking for a job, I understand how the job creation platform is currently a popular one. But creating projects for this purpose alone is a slippery slope, and will lead to many inefficiencies, and absurdities.

I concur with Jaert. It is estimated that at least 489 billion short tons of demonstrated coal reserves exist, at today's market prices. (that number doesn't account for the permitting issues mentioned above) This is enough coal to last our society for 150 years; assuming no more coal is discovered.
I am for cap and trade, and/or making generators pay for the environmental cost of coal. But if carbon sequestration becomes economical it has an enormous potential.

EIAs 2010 Annual Energy Outlook Sites the Following Fuel Costs:
- Coal, Average Delivered Price - $2.16 per million Btu
- Natural Gas, Wellhead Price - $7.85 per million Btu
I believe the recent popularity, and higher growth rates for NG (46% capacity addition for natural gas; versus 12% for coal) is due to the lower capital costs involved in constructing a new NG plant; not due to an expected sustained drop in fuel costs.

http://www.eia.doe.gov/oiaf/aeo/pdf/appa.pdf