Monday, February 25, 2013

Rules of the Game - A Forum Primer

Sometimes it is beneficial to view the bigger picture, to get on top of things and look around, to actually see the forest and not get preoccupied with all the trees. Sort of like this, where perhaps you can see what is possible and not get so hung up on why the possible seems to be so out of reach, so impossible.... at least, in this part of the world.


from http://www.altenergyshift.com/gallery/image/241-enercon-e-126-wind-turbine-above-low-clouds/. Right now, that kind of picture cannot be seen "in real life" in the USA (this picture was taken two years ago in Estinnes, Belgium - see http://www.7mw-wec-by-11.eu/events.html). The Enercon E-126 is still the biggest wind turbine in the world, installed by one of the biggest crawler cranes in the world, made by a company widely held to make the highest quality wind machines in the world, ones which are not sold in the USA. The top of the nacelle would be about 470 feet above the ground (a 15 meter diameter "egg" placed on a 135 meter tall concrete tower) and the blade tops out at close to 650 feet at the peak part of its rotation. In many parts of Europe, the winds near the ground tend to be pretty wimpy by US standards, so to tap decent winds, you've got to "reach for the stars". And just to assemble the main crane takes about 100 trucks worth of equipment - see http://www.renewableenergyworld.com/rea/news/article/2009/09/e-126-in-action-enercons-next-generation-power-plant. Installing one of these units is not a trivial event...

This turbine is rated at 7.5 MW, and it is now being mass produced. It is made possible by Feed-In Tariffs from both the technological and construction/financing standpoint. These units at Estinnes have an average output of about 32% of their rated capacity, and the array of 11 of these averages around 21 MW. It's what can be done if people are serious about making electricity at reasonable prices and in significant quantities from regions where the wind resource is considered "moderate". Of course, installing a 2.5 MW is also a pretty big event, and 3 of those can also have a similar output. But according to the maker of these 7.5 MW units, more energy generation per unit area of land is possible with the "big boys".

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There will be a day-long conference hosted by the EPA and UB coming soon (March 14) to Buffalo
called the The Western New York Green Infrastructure Forum. "The Forum will cover important and practical issue to allow local communities in Western New York better prepare for, fund and create green infrastructure projects." Will it get something done, or be a "total tease"? Will our community get any closer to giving fossil fuels - especially petroleum consuming automotive transportation and coal generated electricity - the boot, and will we be able stave off the plague of potential "Frackingmania", either  as a result of this session or just because of dumb luck? Can we overcome the "curse of cheap electricity"? This "curse" gives us no new jobs but which keeps the electricity bill remarkably low, as long as you only concentrate on the generated portion and ignore the fees to transport it to customer locations, and keep burning that coal imported from apparently foreign lands, like West Virginia and Wyoming... Of course, that leads to more CO2 pollution of our atmosphere, along with associated climate destabilization; for this, this is a minor inconvenience in order to get their fix of 3.1 cents/kw-hr average generated electricity pricing, though that might not be true for their descendents.....

So what makes turbines like the E-126 happen in Europe or Canada but not here in the USA, where we have more wind energy than we know what to do with, by a factor of at least 20, and one of the biggest electricity consumption rates of any country on the planet? Actually, it's pretty simple, and until the issue is dealt with, it makes all kinds of existing WNY infrastructure pretty useless. The secret - at least to many of us in this country - is that in much of Europe the owners of these turbines can actually get a price for their product (electricity from the turbines) that will cover the cost of generating the electricity, which is mostly the capital cost of this unit. The price for their product that they get will be fixed for a 20 year or so period, and this allows the owners to finance the project at a much lower interest rate/over longer length of time than would otherwise be the case. That can knock 3 to 5 cents/kw-hr off the cost to generate that electricity versus where "Ya never know" is the pricing motto, and allow electricity to be made for around 8 to 10 c/kw-hr in that not-so-windy part of the planet.

In contrast to that idea of price stability for wind energy, we have a Casino market for electricity in places like NY State, where electricity prices vary with time, and, as far as investment bankers are concerned, are unpredictable. These prices have hourly, daily and seasonal patterns that tend to reflect some combination of coal, nuclear and especially natural gas prices; the prices for wind sourced electricity in NY are based on these pollution based energy supplies/market prices. And it does not matter a bit that a wind turbine does not have any fossil fuel costs involved in making its energy.... Another aspect of the US wind energy pricing arrangement is that the project has to rack up huge "paper losses" (rapid depreciation) - losses that can be deducted from other taxable income, and which have the strange but true property of counting as "tax income". But this means that the project owners must have other taxable income - and large amounts, too, which means this trick is only available to the select few who qualify via large incomes.... It is very "Zen" in order to make money (from Federal and State governments), you have to lose money (on paper); these imaginary losses (MACRS) are essential to the business, and generally worth more than the Production Tax Credit or Investment Tax Credit.

The ability to get fixed prices that are reasonable and long term creates a market for renewable electricity. With that market, it allows a manufacturer to build renewable energy systems and to do the R & D needed to make successively better models as the years go by. It justifies construction companies buying Terex Demag 9800 cranes (needed to install an Enercon E126 and similar sized units, which were announced as commercial products by the likes of Vestas, RE Power, Nordex, Alstom, GE and Siemens), and then people also get hired building and designing those devices, and lots of other things, too. It's the creation of economic demand - the opposite of both austerity and crooked casino style economies - that is almost like magic, except that it is not magic at all - and very well documented, should anyone that falls into the category of "The Serious People" care to look into it. But, so far, they have a pretty impressive record of doing no such thing, both on a national and especially a local level. If they did bother to look, we probably would not need a WNY REDC, and especially one pursuing an apparently obsolete "Eds and Meds" based economic vision - something that became obsolete over a decade ago, about the time Oxychem decided to scrap a $500 million investment in pharmaceutical intermediates in pursuit of quick riches in the US natural gas business....

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One of the aspects of renewable energy from wind is that it can be quite variable in the hour-day-week time-frame, but with predictable seasonal and especially an annual output characteristic. If a region had a way to buffer this variability, as well as to match the fluctuating (though predictable) daily demand, they should be sitting pretty with respect to accommodating a very significant wind "content". This part of NY State has that arrangement, but very little of it appears to be used with respect to wind energy. WNY has some pretty significant infrastructure for renewable energy, mostly sitting in idle mode. We have a very over-sized local electric grid, thanks to the closure of so many factories, and the loss of at least 100,000 people in the past two decades. We have "the big battery" - rated at 240 MW and 4800 MW-hr. There is another 170 MW battery across the river Niagara Falls, Ontario, with 510 MW-hr of energy storage. And if need be, there is the capability of "draining the Falls" for another 1 GW in an emergency. We could make more of these if needed, as there are plenty of hill-water-electric lines combinations available, and these are also nifty job creating construction projects. We have quite the capability of buffering highly variable outputs from wind turbines with the predictably fluctuating average demand, in addition to having some serious grid connectivity with Ontario, the "Utica Junction" in Central NY State, and Pennsylvania (plus the 435/3950 MW-hr MW Seneca pumped hydro facility located next to the Kinzua Dam on the N Y-Pa border.

Another part of the equation is the pretty decent wind resources and lots of land, coupled to the recent commercialization of "low wind speed turbines" (LWST). With that, a new market opportunity opens - the lower portion of "hybrid towers". A hybrid tower consists of an upper "conventional" steel tower placed on a lower reinforced concrete section which offers greater rigidity and the ability extend a turbine hub height from 80 meters or 100 meters to up to 140 meters. The increased heights can raise the annual energy output of a given turbine by 20% to 40% because of the faster winds present at greater heights above the ground. While hybrid or all concrete towers (such as the ones used by the Enercon  E126) have been quite common in Europe for many years and are becoming even more common as larger turbines are used, they are still pretty rare items in the US. And hence, a new business opportunity, one where quality and local availability are at a premium, with no existing competitors of note.

Of course, if WNY has one thing, it is limestone, the raw material for concrete. In some cases, you can even use the accumulated ash form coal burners plus limestone plus some caustic soda for higher strength concretes. We will never run out of limestone, dolomite and sand around here.... More importantly, we have lots of skilled labor going to waste from not making anything of value - a manifestation of lack of economic demand.... After all, it's skilled labor that turns $30,000 worth of concrete and $50,000 worth of reinforcing steel rebar and cables into at least $500,000 worth of tower.

In conclusion, remember that all the wondrous talk of infrastructure that could be built, or actual infrastructure that is made (for example, new electrical transmission line upgrades) doesn't do much good unless we get a sane pricing system for renewable electricity. Without that, we are sort of whistling past the economic graveyard, and construction of any new Green Infrastructure with regards to the production of energy is the nearly the same as building a new office building that can only be filled if its tenants are pirated from existing neighboring buildings. Or perhaps a better example is the actual installation of mass quantities of wind turbines without manufacturing any significant part of them in this region, something that has been the rule to date in NY State, and which is almost unique to NY State. We still have no official explanation of how THAT occurred...., nor apology from any state officials for this occurring..... It turns out the manufacturing jobs that produce the 8,000 or so components of a modern wind turbine, and the new styles of cranes needed for them - alias the supply chain - is the actual infrastructure that we are in need of  to the greatest extent, and then some.

Anyway, that's perhaps a new wrinkle on "Green Infrastructure" for this part of the world. What's your spin on this topic?

Wednesday, February 20, 2013

The Oil and Natural Gas Bubble - 2013


If you are not careful, the issue of resource depletion can be really depressing. And that's one of the reasons that wind turbines are quite amazing - they provide a cure for natural gas depletion with respect to electricity production, residential and commercial heating applications as well as ammonia production/industrial scale hydrogen chemistry - wind is really not subject to depletion of resources. In the US, it turns out that the cure for the natural gas fracking disease is wind turbines - so there is a a positive spin to things (warning: bad pun alert). Besides, they do "good picture".

INTRODUCTION
Care of http://www.desmogblog.com/2013/02/19/fracking-wall-street-housing-bubble, there's a new website that anyone concerned about fracking in NY State (and the USA) should check out. The site can be accessed at http://www.shalebubble.org, and it is both a great summary and also a portal to a lot of detailed information, which leads to even more information. The introduction gives a hint at what's inside this discussion of fracking:

"They tell us we're on the cusp of an oil and gas revolution… what if it's all just a short-term bubble?"

The controversies revolving around fracking are a crazy mix of economics, geology, income inequality, math (including the the Navier-Stokes and Logistic equations plus LOTS of statistics), Global Warming/Climate Change, human population growth and addiction psychology/neuro-chemistry, not to mention topics such as air and water pollution as well as "privatizing profits/socializing the costs" coupled with "sticking it to some poor people" who are likely to be the least capable of warding off the "getting stuck with it" part of the deal. It IS complicated, and as a society, we don't deal well with complication and answers to that complexity that involve changes in behavior as well as actions that take place over both short and long term time frames. and And then there is the fact that liquid fuels and to a lesser extent, methane, are very easy to use and allow a lot of benefits to be obtained at a still comparatively low cost. But underlying this is the fact that oil and natural gas "miners" only use expensive approaches to extracting fossil fuels when all the cheap and easy to find resources have been tapped, and the quest to find more means that harder to get (and more expensive to extract) hydrocarbons have to be targeted. Fracking IS more expensive to do than not fracking, unless fracking is the only way to crack open extremely non-porous hydrocarbon formations and get the oil and/or gas flowing. So when people start telling you that a new source of hard to get gas can be had at cheap prices for long periods of time, prepare to be conned…. big time.

DISCUSSION
There is a little known (at least among the general American public )phenomena called "Peak North American Natural Gas", and this occurred right around the millennium change, coinciding with the Enron centered Fraud Epidemic (1999-2002). It turns out that in a century ( the Twentieth), most of the easy to get (and at one time, plentiful) natural gas supplies (either stand-alone or as "associated gas" - methane dissolved in crude oil) were discovered, consumed and/or are in the process of being consumed. The fields where a few wells could be sunk into porous ground and tap into immense supplies of methane were actually limited, and the prodigious usage of methane over the better part of a century (mostly for heating, industrial uses and electricity production) had taken its toll. At present, the only significant massive North American gas fields are located near the coast of the Arctic Ocean, especially the Prudhoe Bay oil field and the McKenzie River delta gas field, and tapping those means construction of extremely expensive gas pipelines, which are presently not economically justifiable (roughly $20 billion for each one). There is still plenty of methane to be found - but not in massive, easy to extract sites. Instead, ever smaller fields where the methane is located in deeper, less porous formations is the observed trend. With more expensive wells needed which supply less methane than historical average wells have supplied, production costs inevitably go up. Fracking based gas wells in "tight shale" and "tight sandstone" is just a more extreme version of the general trend - fracking wells can cost 10 to 20 times more than "conventional" wells.

Until around 2000, natural gas prices had been very stable, and very cheap. Since 2000, prices have been quite unstable, and on average, much higher than in the 1980 to 2000 period. The stage for this instability was set when "Combined Cycle Gas Turbines" (CCGT) were developed (with lots of Federal government dollars, too) and pushed - notably by GE (they make jet engines, steam turbines and large electrical generation systems) and investment banks who found that there were significant short term profits to be had in this field. These systems now use up to 40% of US natural gas supplies - and it is the increase in natural gas demand that has sped up the current need to frack in order to maintain or even slightly expand US supplies of methane (see graph on pages 3, 23 of http://shalebubble.org/graphs/). Another factor in this "greedfest" was the deregulation of both the natural gas and the electricity markets. It was the ability to game both the electricity and natural gas markets that Enron was able to extract huge profits in a very short period of time from California - enough to throw this state into a severe recession in 1999-2001, and which helped pull the entire country into a recession.

Since 2000, commercial scale wind turbines have been developed and installed in appreciable amounts (though nowhere near as many as are needed to avoid catastrophic Climate Change) - roughly $120 billion worth ($60 billion worth in the last 4 years). It is wind turbines that now often put an upper limit on the price that can be charged for natural gas based electricity. Since the 1990's, electricity prices became based on natural gas for much of the country during this time - ranging from 3 c/kw-hr to 15 c/kw-hr at various times. The cost of electricity made from natural gas is mostly a function of the price charged for that gas. When there was no upper limit to electricity prices (such as provided by wind turbines in much of the US), high gas prices were not a detriment to profitability for gas users, and the by-product was fabulous profits for nuke and coal based generation owners, whose production costs remained fairly constant as electricity prices gyrated to a degree never seen to date.

Another event that began happening at the turn of the millennium was "Peak Oil" (which officially occurred in 2006). By 2003, oil started becoming too expensive to use to make electricity except in ever rarer events. In 2000, fuel oil supplied about 10% of NY State's electricity, and most importantly, this provided competition to both gas and coal based generation; after this, the only competition to coal was natural gas. At present, the bulk pipeline price of natural gas ($3.40/MBtu) is 20% of the thermal price of crude oil ($95/bbl = $17/MBtu). The world oil price (that is, the price charged to those who import oil) is now 8 times what it was in 1998 . All this increases the demand for gas to make electricity as oil is only used in emergency applications… and the increase in the rate methane is consumed means that low cost supplies (which "peaked" around 2000) just get drained even faster…

One characteristic of natural gas these days is the unknowability of future prices, despite the huge gambling arena known as "futures markets". This leads to the corresponding unknowability of future electricity prices, as long as it is natural gas that sets the price of electricity, even if gas only supplies ~ 30% of our electricity these days. There are a huge number of reports (often very expensively procured reports, too) stating what future prices of electricity prices are going to be, but many of these are in reality fictional, because the price of natural gas is no longer based on the cost to produce it but instead on what can be obtained/extracted from customers. Of course, there is a big range in the cost to produce natural gas - that obtained from old, paid off wells is really cheap, as is gas obtained as a by-product of oil production. But when $10 million gets spent on a well that makes only a billion cubic feet of gas in its first 5 years (which is when almost all of the gas from that well will be extracted), only magic (or a massive confidence job) can make that seem to be profitable.

Meanwhile, those darn wind turbines have completely predictable electricity costs from the time that they get their financing package and get purchased. There actually is no need for variable prices for wind sourced electricity - variable pricing will drive electricity productions costs UP for them because the financing will be more costly when variable (and unknowable) future prices are the income source for the turbine owners. At present, the wind based cost to make electricity is higher than the price paid to generators in WNY last year (and so far, this year) of 3.1 cents/kw-hr. But those prices cannot last, and they will inevitably rise, though when at at what rate is unknown. However, we do know what the upper limit will be, care of wind turbines - and that's around 10 c/kw-hr on an unsubsidized basis.

Of course, some will say that raising electrical energy prices by a factor of, say 3 in 10 years (from ~ 4% to up to 80% wind turbine sourcing) is untenable. But such prices existed 5 years ago…. and it was not high electricity prices that did everyone in, but more likely high oil and natural gas prices combined with a bursting of the real estate/banking bubble. And after that price level is reached, there is no need to raise prices higher - regardless of what oil, gas, coil and possible CO2 pollution fees might become. Oh, and then there is the job creation that goes along with making and installing those wind turbines and related systems, as well as the job creation that comes from the avoidance of natural gas price spikes because the demand for natural gas gets suppressed when wind turbines displace natural gas for electricity production. Employed people who are not paying an ever-larger portion of their incomes on natural gas (and natural gas based products, like fertilizer and electricity) are much better off than when fewer are employed and everyone is held hostage by ever rising natural gas and gas based product price rises. Why is that such a difficult concept to comprehend, or embrace?

So, check out the Bubble papers. Make some inquiries, pass these along to friends, and contact/start pestering the politicians that were elected as our leaders. Think about what it will take to keep those natural gas bills low (ever shrinking demand for gas) and those electricity prices from getting out of control. Also, keep in mind that while depleting gas cannot replace electricity, renewable, non-depleting electricity CAN replace natural gas. And that the way to provide competition to natural gas is through renewable electricity. And if you don't provide competition to natural gas, it turns out that ALL natural gas suppliers will start to act as if they are one company - in effect, a giant monopoly/cartel will evolve - especially when the demand for gas outstrips supply. If you thank that supply destroying super-canes (Katrina, Rita, Wilma, Ivan) are a thing of the past in the Gulf of Mexico - which still supplies about 4 trillion cubic feet per year of natural gas - well, think again. It never pays to keep betting against the inevitable - the inevitable always happens, eventually. And since ever increasing CO2 pollution is just cranking up the energy source that super-canes can tap - well, do the math.

Fracking has allowed the US a temporary respite from high natural gas prices, but the temporary excess of gas is dwindling fast since drilling rates for gas are less than 25% of what they were 4 years ago. Fracking has done little to drop oil prices, though it has allowed us to avoid exporting roughly $200 million per day ($73 billion/year) to buy oil now made domestically. But we also use 3 million barrels per day less oil than in 2008, which is roughly $300 million/day of avoided money export, or roughly $100 billion/year, which is 50% more benefit just coming from driving less and driving in more fuel efficient cars and trucks. But whatever economic benefits (which have also come at big costs, environmentally speaking) have come from fracking will be all for naught if we double down on Stupid and actually increase our natural gas consumption rates. If you want to keep gas prices cheap, just use less.


So wind turbines are your friends (like the Maple Ridge ones in this image, c/o EDP Renewables), and the key to keeping methane prices low, and some spare change in your bank account. Of course, there are some fiendish schemers working hard to end that option - at least until more of that methane is extracted, or we go through another natural gas price spike that also spikes profits to coal and nuke based electricity generation facility owners. Here is one of them (Donor's Trust and Donor's Capital Fund), who have spread around $120 million in the past decade in a very sophisticated propaganda effort (http://www.guardian.co.uk/environment/2013/feb/15/media-campaign-windfarms-conservatives?CMP=twt_gu). They seek to convince you that rapacious hydrocarbon extractor corporations are your friends and that the real menace are those wind turbines and those do-gooders like the 40,000 people who demonstrated last week in Washington DC for sane energy and sane climate (actually, sort of one in the same) policies. And who is funding the "Donors" - many of those same rapacious (= unmitigated greed) corporations or rich owners of said corporate entities. Go figure….

Top Image: http://www.northcountrypublicradio.org/news/story/21179/20130103/fiscal-cliff-deal-brings-good-news-for-wind-industry

Bottom image: from http://www.edpr.com/media/media-center/photo-gallery/wind-farms/

Friday, February 15, 2013

Wind Energy Review of 2012

 The Halaide wind turbine - Eeks, its just plain humongous! And perhaps enough to strike terror into the hearts and the minds of astroturfed anti-(renewable energy) people - the purported "Anti People". This is a picture of the first one made, in this case installed onshore along the coast of France on the four legged "jacket foundation" which will be used in future offshore projects. The blades are close to 75 meters (246 feet) long, and the tower is "only" 90 meters tall. It features a slow rotation speed gearless permanent magnet generator that makes 6 MW from the 6 to 12 rpm or so that it spins at. But if you didn't ask Santa for one and you want to be the first on the block to own this hyper-cool piece of high tech, you'll probably have fork over close to $US 20 million onshore and close to $US 27 million for an offshore one. But you'll be the envy of most, and the subject of intense hate by some fanatical pro-pollution folks, so be prepared...

The results of last years efforts in the wind energy business recently have been published by the Global Wind Energy Council (GWEC.net). All in all it was a pretty decent year, with 44.7 GW of capacity installed all across the world, worth roughly $US 75 billion. The two countries that installed the most were China and the US; the European Union also installed about as much as did either the US or China. A listing of the details can be found at this website:

http://www.gwec.net/global-wind-energy-solid-growth-2012-2/

So far, about 280 GW of capacity has been installed on our planet, and this delivers around 50 GW of clean electricity into various electrical grids of the world. Depending on how your priorities are, this is either 50 big nukes avoided, or about 100 x 500 MW coal burners/nat gas burners that don't have to get used. In terms of capacity, China is now the world leader in installed wind turbines (74 GW), but the US (60 GW of capacity) is the leader in terms of delivered electricity (around 20 GW average delivered), versus around 12 to 15 GW delivered for China. In China, the manufacture and installation of them (i.e. consumption of steel, concrete, manufactured metal parts, electrical parts, labor) is evidently more important than the delivery of wind based electricity, which is generally a lot more expensive than coal based electricity in that country. Over 10 GW of wind turbines are not even grid connected in China, though probably they will be eventually hooked up…..

In an up and coming part of the wind biz, offshore wind installations rose to nearly 1.3 GW last year, almost double from 2011; these now total a bit more than 5.4 GW in capacity and about 2 GW delivered. Offshore wind is a lot more expensive to install than onshore wind (installed cost is about 2 to 2.5 times as much as onshore wind), and thus the delivered electricity tends to cost more than onshore wind derived electricity but it also tends to produce at higher net efficiencies because of the stronger winds that exist over water as opposed to on land. Most of this action occurred in Europe, though about 10% of this took place in China. In general, offshore wind tends to be located much closer to major "load centers" than are large onshore wind arrays. In Europe, a typical offshore wind farm would cost between $1.5 to $US 2 billion these days.

On the other hand, because offshore wind arrays are more expensive, there is more job creation and economic development associated with the manufacture and installation of such systems. In countries like Germany, the quality of the wind resource offshore is vastly superior to most onshore locations, and most of the best onshore locations (usually coastal) have already used up with existing wind turbines. In fact, the offshore wind resource can yield up to 4 times more power for a given swept rotor area versus onshore winds in Germany (the reported winds in the North Sea often average more than 10 m/s, with turbines putting out over 50% of their rated capacity at the Alpha Ventus wind farm). And because they are tapping what by US standards are pretty poor excuses for a wind resource onshore, taller towers (which add to costs) are now commonly used. Many towers taller than 130 meters (426 feet) are used with rotor blades longer than 60 meters…. So offshore in Europe, and especially Germany and Belgium, makes sense. Besides, there is plenty of wind resource in the shallow portions of the North Sea - enough to power up all of Western Europe a few times over, and in an extremely dependable manner. In fact, the amount of time turbines will need to automatically shut down due to the winds being TOO FAST often exceed the amount of time the wind speeds are not sufficiently fast enough to spin the rotor…. For comparison, in Buffalo, which has a pretty decent wind resource, winds that are too slow occur about 20% of the time....

Offshore wind is viewed unapologetically as economic development, and of a special kind. At present, Europe has a near monopoly on the skill sets, infrastructure and production of offshore wind turbines (a Chinese attempt to crack this market on the simplest aspect of it - the monopole foundations - proved quite the financial hoser on the Greater Gabbard (504 MW, $US 2.3 billion) project due to improper documentation and poor quality welding). Oops…and like a hot date, a bad impression on the first go round will lead to no further opportunities of note for some time, if ever…. a sort of Valentines Day lament… Because essentially all of the money in these investments in turn is spent in Europe (no economic leakage), the economic benefits of such projects is vastly superior to those where imports are involved … like PV systems imported from Chinese de-facto slave labor based manufacturers.

The latest announcement in the offshore world is the Arcadis Ost project, located in the Baltic Sea mother of the northernmost portion of Germany:

http://www.offshorewind.biz/2013/02/13/germany-arcadis-ost-1-receives-preliminary-approval/

Unlike most of the project announcements - where Siemens has been winning the bid to supply the turbines, especially with their 3.6 MW x 120 meter rotor diameter units - this one was a winner for the French company, Alstom. The Ost array will use the Halaide 150 meter rotor diameter x 6 MW units and this is the first time they will be installed outside of France. Top photo from http://millicentmedia.files.wordpress.com/2012/09/the-alstom-haliade-150-offshore-wind-turbine-is-undergoing-testing-near-saint-nazaire-in-nw-france-courtesy-alstom.jpg

And here is another aspect of offshore wind turbines - tourism sort of like whale watching (only unlike whale watching, not so much uncertainty. This is from the Anholt wind farm which is mostly completed (Denmark, also in the Baltic Sea). The Anholt array will supply about 4% of Denmark's electricity when it is fully operational (picture from http://www.dongenergy.com/anholt/EN/News/anholt_nyheder/News/Pages/AnholtOffshoreWindFarm-Newsletter-February2013.aspx).



This is one of those Siemens 3.6 MW x 120 meter rotor turbines (mostly made in Denmark) which are now the dominant offshore unit in Europe. Perhaps the reason Siemens dumped PV panel production (aside from the fact that it was such a money loser) is that these are a touch more photogenic. Oh well...

Wednesday, February 6, 2013

A New Year, and Some New Windtech…

Picture: The jackup heavy lift ship "Sea Installer" loading up on the parts (towers, nacelles, blades/hub) for a pair of Siemens 6 MW wind turbines so that they can be installed in the Irish Sea (Gunfleet Sands). The nacelles (with blue "Siemens" logo barely visible) come in at around 350 tons, and they have to be lifted at least 90 meters above the sea level.

Another year gone, and roughly another $80 billion spent or so on wind turbines (technically that's called investment in real wealth creating infrastructure). On Jan 1, 2012, the world capacity stood at 237 GW, and 40 GW was added in 2011. Odds are close to 40 GW will have been added in 2012, pushing the total to around 280 GW, or roughly $500 billion worth of investment, including around 105 GW for Europe, ~ 80 GW for China and 60 GW for the US in terms of capacity. Does half a trillion dollars investment in wind energy systems mean that it is no longer a "fringe, "boutique", "alternative" electrical energy generation approach? With the vast majority of this investment done in the last decade (at least $400 billion), this should no longer be thought of as "alternative" except as an alternative to economic stagnation, austerity and recession inducing policies based on nuke and other fossil fuel based money extraction cons…. Oh yeah, an alternative to trashing the Global Climate Control system that was based on 285 ppm of CO2 in our atmosphere, but is ruined by all that anthropogenic CO2 dumped into our atmosphere at such a fast rate that we are now at 394 ppm and careening ever higher….

Of course, in this case capacity only refers to the ability to make electricity; what's more important is the actual making of electricity. It's the electricity made that justifies the $500 billion investment….The US happens to have higher yielding wind turbines than most other countries - partly a function of wind resource and partly a function of the types of turbines/age of these turbines. For example, average US output is now around 20 GW, while that for China is less than 11 GW (http://en.wikipedia.org/wiki/Wind_power_in_the_People%27s_Republic_of_China). Wind turbines now supply around 56 GW of electrify around the world, the equivalent to about 12% of what the US now uses, or roughly the output of 56 X 1.1 GW nukes whose "new" cost would be well in excess of $560 billion.

But, no rest for this highly competitive industry with so much potential to at least completely power up North America, several times over and at a real cost no other renewable energy with such capacity can come close to matching. One of the interesting developments to watch is the continuing evolution of Low Wind Speed Turbines  (LWST)- tall turbine towers and longer blades strapped onto ever larger and more dependable generators. Turbine companies are now focused on "medium" and "low" wind speed areas that are more closely located to major population centers (electricity customers), in contrast to tapping high wind speeds that move over regions often thousands of miles from where customers are located. For example, Kansas could power up almost all of the US with its winds on an average basis, but that would also take a lot of new and very expensive wiring. It's cheaper for NY state to locate turbines attuned to low wind speeds in NY State in terms of delivered electricity, with only small amounts of "distant wind" for use when local winds aren't blowing sufficiently fast. And when you think of the economic benefits - property taxes retained, lease payments recycled and the potential of local manufacturing to once again be used to generate real wealth locally instead of exporting it to distant parts of the US or the world… well, that SHOULD make the sale. But with the specter of frackers and their legions of con-artists and fraudsters hawking dreams of easy money to politicians desperate to show the folks at election time with respect to something (who cares if it is mostly or all illusion, just so long as it makes the news) associated with economic development, one should not count on logic and truth winning the sale - see http://www.nakedcapitalism.com/2013/02/dan-dicker-aubrey-mcclendon-and-the-destruction-of-the-natural-gas-market.html for an unabashed pro-fracking investor's take on the fraud-fest that goes by the name of Chesapeake Energy….

So we have new generators from Hyundai (not quite 6 MW- http://www.worldwindpower.net/web.php?uid=&wid=2&cid=6219) and ABB (including a new 7 MW one for offshore http://www.offshorewind.biz/2013/02/04/video-abbs-7-mw-offshore-wind-generator/). There are now at least 3 manufacturers of blades that are 75 meters (246 feet long), or roughly the size of the rotor diameter of GE's most popular turbine (77 meter rotor diameter). Areva just announced construction of their 135 meter rotor diameter offshore turbine on a 5 MW unit. Gamesa's new 5 MW demonstration unit just was completed. Vestas has just partnered with Mitsubishi on their 8 MW unit with an 80 meter blade (http://www.offshorewind.biz/2012/11/27/denmark-vestas-negotiates-construction-of-8mw-offshore-wind-turbine-with-mhi/); that blade is undergoing testing on the Isle of Wright located near Ireland and Wales. Siemens just installed a pair of their new 6 MW turbines with 120 meter blades (four now) and permanent magnet generator/no gearing unit http://www.windpoweroffshore.com/2012/09/21/gunfleet_sands_3_prepares_for_siemens_6mw_turbine_test/#.UREhyugd4Xw). A full scale deployment of the 6 MW units (using 154 meter rotor diameter and 75 meter long blades) was also just announced (http://www.nawindpower.com/naw/e107_plugins/content/content.php?content.11066#.UREi6-gd4Xw) - 35 of them installed will be around a $US 1.4 billion investment/pilot plant for the Western Rough offshore wind array in England. Meanwhile Siemens also announced a "stretch version" of their popular 3.6 MW SWT-120 - the 4 MW SWT-130.

As for the low wind side of things, GE (http://www.ge-energy.com/products_and_services/products/wind_turbines/) recently unveiled its 2.5 MW x 120 meter rotor unit with towers as tall as 138 meters. This takes a page from the arch-nemesis of GE (in the wind business, anyway), Enercon, who for several years have routinely been mass producing concrete towers (http://www.enercon.de/en-en/755.htm) specifically made for big TALL wind turbines, such as their now commercial 7.5 MW by 126 meter rotor diameter system with its tailor made 135 tall tower. But, if you have inferior technology (small, 1.5 MW turbines on 80 meter tall towers), adapt or go out of business is one of the rules of the game. Besides, putting the nacelle 135 meters above the ground drops the sound level at the turbine base by 4.5 dBA  (over 50%) at the turbine tower base. And isn't quiet turbines what anti-turbinites both want and fear - as in, what if there is nothing factual to complain about? Oh right, that's pretty much their present predicament, but it hasn't phased them or their fossil fuel and nuke based funding sources…..

As for the push for high yields, Nordex (http://www.nordex-online.com) is promoting a 3 MW version of their 117 meter rotor diameter N117 unit (the low wind speed version is still "only" 2.4 MW rated) designed for fast wind locations and a 3.3 MW version of their N100 100 meter rotor for really fast wind locations - like the US Great Plains. They want to stress wind turbines with average yields of 50% (these days, 40% is considered to be very decent), and are in the process of upgrading their existing models ("Delta Generation") for that, including their LWST offerings.

So much potential, trying to meet the hundreds of billions of investable money now sloshing around world capital markets like Toronto, NY City, London and Paris, more or less "homeless". There's a concept for you, "homeless multi-billion dollar increments". All it needs is a stable, sensible price for electricity and it is ready to be deployed on this next generation of wind machines, which have the highest Energy Return On Energy Invested (EROEI) of any significant renewable generation technology around (now well over 20:1, or less than 6 to 9 months operation in a 25 year lifespan).

So what's the big hold-up in NY State, where we just got nailed with a warm-up call from Planet Earth in the form of Frankenstorm Sandy? Well, state regulators, legislators and government officials are still addicted to Casino pricing for electricity - a variation on "ya never know" what the future prices for electricity will be. But to apply that to the wind biz is to add costs that impart no value at all, sand which can raise the price needed for wind sourced electricity by 3 to 5 cents/kw-hr. And for what - the sake of ideological purity with respect to failed neo-liberal economic doctrine which also favors short term prospects and natural gas (= fracking) sourced approaches to electricity production? Didin't the recent dope smack to the head in terms of a  $30 billion (minimum) damage bill for just one hurricane turned nor'easter tell them anything? Oh well, economic myth and illusions are amongst the nastiest of habits to shake four NY's "decision making class", many of whom were never elected by anyone but instead selected by the beneficiaries of either inherited wealth or luck combined with pretty outrageous and rapacious wealth extraction from what is called a "criminogenic" environment.

All this and a lot more fine renewable electricity production equipment COULD really spark off quite the economic recovery in NY, could being the key word. A lot of it could even be arranged to be made in NY if we would commit to the replacement of the 13 GW of pollution sourced electricity we are now employing. It has to go, anyway, as it gets old, and the potential for really bad things happening (like our very own version of Fukushima (coming up on a two year "anniversary")) never goes away until these are shut down. Besides, what are we going to do with the 1 to 2 million NY'ers who could really use a job, and the 50,000 to 80,000 of them just in the Buffalo region. Evidently we are not so ruthless as to just terminate their lives, as was done with any hopes of gainful employment in the present permanently slack Economic Demand society we have devolved to. What's the problem?  So far, not so many facilities are making LWST units and the taller tower (100, 120, 138 meters or thereabouts), and these are absolutely made for NY State's wind resource. Make them here and cut out a lot of money to haul them here, too… geez, local manufacture and it cuts installed costs, too….

FYI: World wind energy information: http://www.wwindea.org/home/index.php/index.php?option=com_content&task=blogcategory&id=13&Itemid=40

Top Photo: from http://www.heavyliftpfi.com/content/NewsItem.aspx?id=5477

What's your take on these inter-related problems, anyway? Perhaps too much of the "Murder by Numbers" ethic is still in fashion these days (see http://www.songfacts.com/detail.php?id=569 and http://www.songmeanings.net/songs/view/5915/). And that's not going to get people working or these fine new strapping wind units installed:

"Murder by Numbers" by Sting and Andy Summers/song by first performed by The Police

Once that you've decided on a killing
First you make a stone of your heart
And if you find that your hands are still willing
Then you can turn a murder into art

There really isn't any need for bloodshed
You just do it with a little more finesse
If you can slip a tablet into someone's coffee
Then it avoids an awful lot of mess......

Monday, February 4, 2013

One Region Forward, Sorta, Depending on Who You Are

World oil prices tend to be set by the quantity of oil available for export, and not the total amount produced. In many oil exporting countries (Saudi Arabia, Iran, Russia, Venezuela) domestic oil products are quite cheap compared to world oil prices. So when the amount available for export shrinks, higher prices tend to result in oil importing countries like the U.S. It's one of those "FYI's" not mentioned at the recent "One Region" session held last week... Note that the peak export years were 2005 to 2007. Oops.... Data from the US energy Information Agency. The relationship between the quantity of oil available for export and prices seems based on whether more oil will be available from one year to the next, or not...

Last Tuesday (1-29-13), about 200 people attended the "One Region Forward Community Congress" at Asbury Hall in downtown Buffalo. While there seemed to be a lot of effort put into this "One Region" effort, and while most of it apparently done with a lot of it well meaning intentions, there were a pair of "Voldemort's" - the ones who must not be named in the Harry Potter world - who more or less remained secrets and were not named in the official part of the presentation. And yet, these two specters are the drivers for much of the the malaises that were described - urban sprawl, increasing costs of governments/cost of living for most people while the regional population drops as do average incomes and accumulated wealth. But maybe there were not supposed to be any solutions to these identified problems - maybe that was the point. There is a concept in the R & D business called "researching it to death", and the presentation was thoroughly infused with that concept in "project life extension" and futility hybridization. However, that sort of thing does employ SOME people who obviously wish to remain employed and thus not go the way of the blast furnace operator in this part of America's North Coast…. And there has been lots of employment in the sprawl business, too - for many, sprawl has lead to fabulous riches, and amazing swindles (think HSBC and its HFC subsidiary…). Of course, the sprawl based profiteering extracts money and wealth from other parts of the region and country, to the eventual detriment of most, but as long as some influential "someones" profits handsomely and at a fast rate, isn't that what's important to our local "movers and shakers"……?

So what are these "Voldemorts"? One is racism - at least the variation on that theme where mostly richer and  employed people (mostly white people, too) flee to the suburbs and take their money and jobs with them, leaving behind concentrated poverty and effectively no access to a society's benefits that are mostly available on the basis of money. The other one is petroleum, and in particular the presently occurring phenomena called "Peak Oil". The society of sprawl is based on oil - remove the affordability of, access to oil and the suburbs have to fold like a cheap suit. But, there was no mention of the "Iron Triangle" of petroleum, oil based transportation (especially cars and trucks) and suburbs all held together with large quantities of incredibly cheap debt. And for many, debt, it turns out has grown faster than incomes, and is becoming more like a harsh master and less of a helper to facilitating a better life, so even that part of the triangle is also looking less desirable these days… And then there is the whole debt-oil price relationship, especially for a region more reliant on the Albany/NY City "sugar-daddy" arrangement because the manufacturing segment is kept in a profound sate of disrepair and disrespect.

And so, there were these interesting factoids told about population "un-densification", more roads, fewer people, and the fact that the average trip that food makes is 1500 miles from where it is grown to its consumption in Western NY. Oh yes, there was also mention of climate change/global warming going on (exacerbated by sprawl, of course), but no solutions offered of note, nor even a glimpse of how to employ people in dealing with these issues - though "climate adaptation" was mentioned. And then there were those hints that only the educated worthy would be the ones employed to study these problems, and possibly benefit from any solutions to this regional stagnation…..

And so this planning discussion session rapidly devolved into something similar to the musings of an alcoholic describing how booze has taken him down, as he cracks open the seal on the second fifth of whiskey to be consumed for the day. And since much of the presentation and all of the 160 reports that 64 municipalities and other organizations that produced this effort were generally written by upper class/upper middle class people more or less "cut from the same cloth", no wonder the things that might make them uncomfortable were never mentioned. In this analogy, maybe this diseased (with alcoholism) person will kick the habit one of these days, but there was no evidence that this is likely, or that all of the enabling accomplices will also get off this road to nowhere any time soon. Besides, it IS so much fun to talk about it, to "research the living beans" out of this experiment in regional asset destruction, impoverishment and extreme segregation in the "City of Good Neighbors", so evidently it will continue for a while….

Of course, everybody KNOWS about the fact the the wealthier 'burbs in Erie and Niagara Counties are incredibly segregated, and its inhabitants are pretty devoid of much melanin content. But it seems to be accepted as if it is the will of the divine, since only the worthy are entitled to live a good life, supposedly. As for why oil prices have increased by a factor of 6 since 1998…well, maybe that, too is divine providence, as it is SO UNQUESTIONED. But about a billion and a half dollars every year has to be exported from our region to pay for oil products imported into these two counties that allows us access to all petroleum can power up at present prices - and five years from now, that's apt to be at least $3 billion. What proverbial pound of flesh has to be lopped off to pay the rapidly escalating costs for the petro-fix? Might it be easier to start shedding the Iron Triangle's grip on the ways that we subliminally think and behave? Or is it all about "who gets tapped" for the pound of flesh that is important, which often translates into "the usual suspects" - ones who tend to be poorer and without significant means to communicate this inequity to those in the 'burbs who tend to now call the tunes, politically and economically speaking. Besides, maybe this profound inequality is an OK situation with most of the inhabitants in the 'burbs...

Maybe, but for a hard core alcoholic (like our society is about its oil "issue"), getting free of the addiction is often a long and difficult road. Sure, admitting there is a problem is a useful start, but continual drinking after admission of perhaps a problem does not "solve" the problem. It's quitting drinking that solves THAT problem - and odds are, there's more than one problem that needs solving to cut off the problem boozing - this  often involves changing behaviors, lifestyles and so much more. It is often possible to get on the wagon and off the booze, but not everyone can do it, does it or even wants to do it; some just like to complain about the habits they know aren't good for them while continuing to indulge in them. But for some, they see no alternative, or don't like the alternatives that do exist, and they are willing to "go down with the ship" before they will change their inequitable and unsustainable ways. Maybe in a society a lot less "oiled up" the extreme degree of socioeconomic and related segregation is no longer possible, just like "ex-urbs" are no longer possible except for the extremely wealthy. For some, essentially complete impoverishment from high oil products prices and the ever harsher recessions associated with quadrupling oil prices in a decade is what it will take to end the "separate and unequal" that also seems to be part and parcel of the Iron Triangle, at least for those rendered unworthy by lack of money. Unfortunately, we need to keep in mind that sometimes equalization via mutual poverty produces profoundly bad results - the "impoverish most everyone" approach really is something to be avoided if at all possible.

And so the planners of our "One Region" forgot to make sure there would be gasoline in the tank before starting on this new planning endeavor. And with no spare fuel tank, or extra money in case they are lucky enough to find any fuel, that tends to be similar to being stranded in the desert without any water, and definitely not a good situation. And now the car doesn't work, and there's no way to get to work, buy stuff and keep the economy moving along. What would you do for a bit of gas in a situation like that? It's not good at all to be so vulnerable for something you have no control over, and which was known for a long time to be coming, and which could have been prevented. The big warning came in a Scientific American article (March, 1998), and Peak Oil officially arrived in 2006, though it wasn't officially announced until 2011. You can see the trends (top graph) leading to the prediction below (bottom graphs). Maybe they might want to speak it's name and incorporate it into the plan. In fact, just plan on Peak Oil doing things no one really wants, and the way to avoid that fate is to plan on not really using petroleum at all, and really soon, not decades far off into the future…



The graphical approach to determining the average rate at which prices rise over a set length of time is to plot the logarithm of prices versus time; the slope of the best fit line is the average price rise rate. From 1983 to 1998, oil prices in the U.S. were pretty constant, reaching an all-time low in the late 1990's as the North Sea oil fields between England/Scotland and Norway reached their peak production. Those fields have been good for about 40 billion barrels so far (and lots of natural gas), but are "in decline", like most of the major oil fields in the world now in production mode. Maybe it's time to plan for when oil will get too darn pricey to run an economy and a society on oil products for the transportation energy needed to move people and goods around. Ya think? Or should it be ignored until it is just too darn late to do anything about it, and the next generations have to deal with the mess that has been kicked down the road for far too long.

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