Discussing Energy Economics on the Internet

US Blocks New Solar

Posted in Renewables,USA Federal by Cheryl Morgan on the June 30th, 2008

Just when the solar industry thought it was ready to take off, a huge road block has been placed in the way in the shape of the US Bureau of Land Management. Over 130 applications are currently pending to build solar energy plants on desert land in areas such as Arizona, Nevada and Southern California. However, the federal authorities who manage the land have become nervous about the amount of planned development and have announced a moratorium on new projects until a major environmental impact study can be completed – a task that is likely to take two years. Naturally the fledgling solar power industry is not happy. The New York Times has comment, as does the Daily Telegraph.

July EEnergy Informer

Posted in EEnergy Informer by Cheryl Morgan on the June 30th, 2008

The July 2008 issue of EEnergy Informer has been released. The contents list is as follows:

  • Has Oil Reached A Turning Point?
  • Blowing Too Fast? Exponential Growth Brings Problems For Wind
  • Sempra’s LNG Bets Pay Off With Costa Azul
  • Exxon Dismisses Wake-up Call
  • Erratic Prices Afflict Texas Market
  • BP Abandons Australian CSS
  • Still Looking For A Site For Nuclear Waste
  • Solar Energy Striving For Grid Parity
  • Outage In Britain Gives Brown A Pretext To Push Nuclear Agenda
  • IGCC Suffers Regulatory Setback
  • Xcel To Showcase Smart Grid In Boulder
  • New Website Launched

The article on the LNG is available for free, and the final article is about this site. All other articles currently require a subscription to the paper edition of the magazine. To subscribe to EEnergy Informer click here.

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National Grid Joins Doubters

Posted in Transmission,UK by Cheryl Morgan on the June 27th, 2008

National Grid has joined the chorus of people doubting whether the UK government can carry through its ambitious targets for renewable generation, and once again the issue in the planning process. Nick Winser, the company’s executive director for transmission, sums up the problem very neatly in Energy Business Review:

National Grid has already signed agreements to connect 16GW of renewable generation throughout the UK, but over 75% of this total is stuck in the planning system awaiting planning approval.

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UK Announces £100bn Renewables Plan

Posted in Renewables,UK by Staff on the June 26th, 2008

Prime Minister Gordon Brown today announced a massive investment plan intended to boost the amount of electricity that the UK generates from renewable sources, especially wind. Not that the money is coming from the government, of course. Instead the plan is to encourage investment from private industry through a series of incentives yet to be announced.

EIA Issues 2008 Energy Outlook

Posted in Generation by Cheryl Morgan on the June 25th, 2008

The EIA’s Annual Energy Outlook is due to be issued today. The report has been available in overview since March, but today’s release should see the complete document coming available. Highlights of the forecast are available on the EIA web site. The report is unlikely to be happy reading for the renewables lobby. It predicts that the percentage of electricity generated from renewables will fall from 18% in 2005 to only 15% in 2030. Production by nuclear generation is also forecast to fall, from 15% to 11%. Meanwhile production from natural gas is forecast to increase from 20% to 25%, and production from coal to increase from 41% to 46%. The remainder of the production is from liquid fuels. As Platts notes, the increase in coal production is mainly a result of the rapid increase in capacity in China.

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Latest British Energy Rumor

Posted in Nuclear by Cheryl Morgan on the June 25th, 2008

The latest rumor regarding the British Energy sale is that Centrica will agree to take a minority stake in the company, thereby reliving government fears about the company being in foreign hands, and allowing EdF to up its bid for the nuclear generator. (Story via Energy Business Review.)

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The Economist on Energy

Posted in Renewables by Cheryl Morgan on the June 20th, 2008

The latest issue of The Economist contains a long Special Report on The Future of Energy. Written by the paper’s science editor, Geoffrey Carr, it takes a look at where the energy industry might be headed in the next decade or so. Mr. Carr has a good grasp of the fundamentals of electricity generation and applies that knowledge to a survey of the activities of venture capitalists and research departments in major corporations to try to discern where our industry might be headed. Partisans of particular solutions to current industry issues will doubtless disagree with some of his findings, but the general tone of the report is reasonable and promises interesting times ahead.

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FERC Issues New Open Access Order

Posted in Electricity Transmission,USA Federal by Cheryl Morgan on the June 20th, 2008

FERC has issued a new Open Access Transmission Tariff Order, No. 890, which revises and updates the famous Orders 888 and 889. Specific priorities for the new order, other than strengthening the existing rules, are:

  • To provide greater specificity in the pro forma OATT to reduce opportunities for the exercise of undue discrimination, make undue discrimination easier to detect, and facilitate the Commission’s enforcement; and
  • To increase transparency in the rules applicable to planning and use of the transmission system.

An overview of the new order can be found here, and there is commentary from Platts here.

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EU Deal Suffers Setback

Posted in Electricity Transmission,Europe,Gas Transmission/Storage by Cheryl Morgan on the June 20th, 2008

Last month we reported on a possible compromise deal in EU market liberalization whereby transmission owners (in particular large “national champions”) would not be required to sell off capacity to promote competition, but instead would simply cede operational control of their networks to independent Transmission System Operator. That plan now appears to have foundered on the rock of the European Parliament which has voted, by a majority of 449 to 204, to insist on actual ownership unbundling of the networks. EurActive has more details.

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New UCEI Paper on Oil Prices

Posted in Oil,Papers by Cheryl Morgan on the June 19th, 2008

UCEI has a new paper available online. “Understanding Crude Oil Prices” by James D. Hamilton looks at the causes of oil price rises. The abstract sounds quite interesting:

This paper examines the factors responsible for changes in crude oil prices. The paper reviews the statistical behavior of oil prices, relates these to the predictions of theory, and looks in detail at key features of petroleum demand and supply. Topics discussed include the role of commodity speculation, OPEC, and resource depletion. The paper concludes that although scarcity rent made a negligible contribution to the price of oil in 1997, it may be an important feature of the most recent data.

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