Antero Resources To Pipe Water To Fracking Wells

Antero Resources Inc., plans to spend more than half a billion dollars on an 80 mile pipeline that will carry water from the Ohio River to fracking sites in West Virginia and Ohio.  Fracking, an oil-field technique driving the nation's current energy boom, involves injecting vast quantities of water into the earth, along with other materials, to break up rock formations and unlock trapped oil and gas.

Antero Resources wants to tap the Ohio River, above.

 

Hydraulic fracturing is a water-intensive business.

• Average amount of water used to hydraulically fractureasingle Marcellus Shale well: 4.2 million-5 million gallons
• 4.2 million gallons is enough water for a town of 42,000 people for one day
• Number of Marcellus Shale wells drilled in 2005-July 2013: 8,700*
• Percentage of freshwater used: 90%
• Percentage of water recovered from fracks and reused: 10%

Note: *Includes wells drilled and fracked through May 2013 in both Pennsylvania and West Virginia, but doesn't include every well. Some data are still being processed. Sources: Susquehanna River Basin Commission via Environmental Protection Agency; West Virginia Department of Environmental Protection
 

Colorado-based Antero, which has announced plans to go public, had oil and gas revenues of about $265 million last year, according to filings with the Securities and Exchange Commission.  The company says it is the most active driller in the Marcellus Shale, a gas-rich rock formation that stretches across Pennsylvania and into New York, Ohio and West Virginia. It is also pushing into Ohio's Utica Shale as well. The company uses a total of about six million gallons of water to frack each of its wells.

The proposed pipeline would slash the company's water costs by two-thirds, or about $600,000 per well. The trucks that now deliver most of that water are a "very, very large expense.

Tapping the Ohio would give the pipeline access to the region's most dependable source of water. Many of the rivers and streams that Antero now uses run low in the summer, prompting state officials to stop gas-industry withdrawals. A drought in Ohio last year curtailed water to fracking operations.

Ohio River & watershed

In a permit filed with the Army Corps of Engineers, which regulates water withdrawals from the Ohio River, Antero plans to build an intake pipe capable of sucking up 3,360 gallons of river water a minute—or about 4.8 million gallons a day.  Pumps would send the water through a 20-inch steel pipe eastward where it would be collected in several large pools before it was piped to drilling pads. The Army Corps has approved part of Antero's plan, and a decision on the remainder is pending.

A growing number of pipelines are supplying water to fracking wells—though few of them have been anywhere near as expensive. Antero filed for an initial public offering in June.

In 2011, Range Resources Corp.  built a 20-mile pipeline in the West Virginia panhandle to move water from the Ohio River.  In 2012, Aqua America Inc. built a 54-mile pipeline in northern Pennsylvania that serves several different energy companies.
The pipeline cost about $100 million.  It is estimated that the industry has spent nearly $1 billion altogether on water pipelines.  Exxon Mobil Corp.  has built three relatively short water pipelines in Pennsylvania and West Virginia.

Based on the company's projected savings of $600,000 per well, Antero would need to frack 875 wells to break even; according to its filings, it plans to frack 135 wells in the Marcellus this year.

While the pipeline's construction costs are high, the project could pay off if there was a drought that sent other companies scrambling for water.  Access to reliable, affordable water can make or break the profitability of companies doing shale in a remote, water-scarce region.

Antero is an energy company backed by New York private-equity firms. The pipeline might not remain with the publicly traded Antero for long. According to its SEC filings, the company's top management and its private-equity backers, which include Warburg Pincus LLC, Yorktown Partners LLC and Trilantic Capital Partners, will be able to force the company to split off its gas and water pipelines into a separate company, called Antero Midstream. Antero would enter into a 20-year agreement with the new Antero Midstream to purchase water.

Shareholders of the newly public Antero would own the split-off company, but the private-equity backers and Antero management would retain management control and ultimately receive 50% of the cash distributions generated by the pipeline company.  (WSJ, 8/13/2013)

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Duke Energy Cancels Plans For New Nuclear Plant

Duke Energy has dropped plans for a $24.7 billion nuclear reactor complex in Levy County, Florida, on which the company has already spent $1 billion, most of it collected from customers.  The company cited “regulatory uncertainty” after a change in Florida's rules that cast doubt on whether a utility can collect money from customers for construction work before a project is finished.  The project was started by Progress Energy in 2008, and was acquired by Duke when it merged with Progress Energy last year.  (NYT, 8/1/2013)
      

 

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HyperLoop

Pods would be mounted on thin skis made out of inconel, a trusted alloy of SpaceX that can withstand high pressure and heat. Air gets pumped through little holes in the skis make an air cushion. The front of the pod would have a pair of air jet inlets—sort of like the Concorde. An electric turbo compressor would compress the air from the nose and route it to the skis and to the cabin. Magnets on the skis, plus an electromagnetic pulse, would give the pod its initial thrust; reboosting motors along the route would keep the pod moving. In theory, the pods would be propelled at high speeds just below the sound barrier, and the set-up would be powered by solar panels running along the top of the system.

Pods, with skis on the bottom zip through tunnels put under low pressure.  The pods will ride on air bearings. The pod produces air, and it’s pumped out of little holes on these skis.  You can move huge, heavy objects with very low friction, using air bearings. In the consumer sense, people would be familiar with air hockey tables, except in this case the air bearings are being generated by the pod itself, as opposed to the tube.

You don’t want the tube to be expensive. Because the tube is so long, you want the expensive stuff to be in the pod.

Some people believe it is impossible because it would require too much energy to get something through a tube at such high speeds and long distances.  Some are questioning the energy that would be required to move the air and the pod. But it is not the air that is moving the pod. The pod is accelerated to velocity by a linear accelerator, which is basically a rolled-out electric motor. The air in the pod is going maybe 200 to 300 miles an hour, and it is low-density. So some were thinking: ‘Oh, the air is sea-level density, and the air itself will be the thing that pushes the pod.’ But that is not the case.

You do want to have a continuously circulating loop of air so that you are not losing energy by letting the air slow down. But it is more efficient to have the pod go faster than the air. If you just try to pump air—particularly at sea-level pressure—through what is effectively a 700 mile loop, the energy required would be extremely high if you wanted that air to go fast because of friction against the side walls of the tube.

 

How would the linear accelerator work that gets the pods going?  It’s actually a linear electric motor. It’s a very basic thing. They have been around for a very long time. The air skis in the pod would have a thin row of magnets—you don’t need much. The linear motor would electromagnetically accelerate the pod. It would be just below where the skis are. It just creates an electromagnetic pulse that travels along the tube and pushes the pod to that initial velocity of 800 miles per hour.  About half a dozen re-boosts would be needed between San Francisco and L.A., but the linear induction motor size needed for re-boosts is much smaller than the initial one.

How would you slow down?  When you arrive at the destination, there would be another linear electric motor that absorbs your kinetic energy. As it slows you down, you put that energy back into a battery pack, which then provides the source energy for accelerating the next pod and for storing energy for overnight transport.

The solar panels would be laid on top of the tubes. You would store excess energy in battery packs at each station, so you could run 24-7.  (Bloomberg Business Week, 8/12/2013, Wash Post, 8/12/2013))

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China To Become World’s Largest Oil Importer

EIA's August 2013 Short-Term Energy Outlook (STEO) forecasts that China's net oil imports will exceed those of the United States by October 2013 on a monthly basis and by 2014 on an annual basis, making China the largest importer of oil in the world.

The imminent emergence of China as the world's largest net oil importer has been driven by steady growth in Chinese demand, increased oil production in the United States, and a flat level of demand for oil in the U.S. market.

U.S. total annual oil production is expected to rise by 28% between 2011 and 2014 to nearly 13 million barrels per day, primarily from shale oil, tight oil, and Gulf of Mexico deepwater plays. In the meantime, Chinese production increases at a much lower rate (6% over this period) and is forecast to be just a third of U.S. production in 2014.

On the demand side, China's liquid fuels use is expected to grow by 13% between 2011 and 2014 to more than 11 million barrels per day while U.S. demand hovers close to 18.7 million barrels per day, well below the peak U.S. consumption level of 20.8 million barrels per day in 2005.

Looking beyond 2014, higher U.S. oil production and stagnant or declining U.S. oil consumption, coupled with China's projected strong oil demand growth and slow oil production growth, suggest that once China replaces the United States as the world's largest net oil importer, the gap between net oil imports in China and the United States will grow.

There are several different ways to measure oil import dependence. Discrepancies in the way dependence is assessed arise because oil is imported as crude oil but consumed as refined products, of which crude oil is the main but not only input.

Net oil imports reflect the broadest measure of liquid fuels and include the following elements in the volumes of oil liquids produced and used within national borders: crude oil, lease condensates, natural gas liquids, biofuels, other liquids, and refinery processing gain, which in the United States has been roughly 1 million barrels per day in recent years.

Another common (and narrower) measure of oil import dependence is the ratio of net imported crude oil to net crude oil inputs to refineries. The United States has emerged as a significant net exporter of petroleum products in recent years and a portion of U.S. crude oil imports is used to produce products not consumed domestically. The advent of China as the world's largest importer based on the narrower measure occurs on a different schedule than for the broader one, but the basic trends and drivers remain the same as for the broader measure. However, imports of crude oil alone do not automatically imply domestic dependence on foreign supplies.  (DOE-EIA)

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San Jacinto Mountains Wildfire

The latest wildfire raging through a rugged Southern California San Jacinto Mountains range has already destroyed 26 homes and was threatening more than 500 other residences, forcing some 1,800 people to evacuate. More than 1,400 firefighters and nine helicopters battled the flames as they pushed eastward along the San Jacinto Mountains, a desert range 90 miles east of Los Angeles.  The blaze was heading toward the desert town of Cabazon and was estimated at nearly 22 square miles Thursday with 20 percent containment

Along with Cabazon, the evacuation orders covered two camping areas and the rural communities of Poppet Flats, Twin Pines, Edna Valley and Vista Grande.

A helicopter drops water over a wildfire

 on Thursday, Aug. 8, 2013, in Cabazon, Calif.

 (AP Photo/Jae C. Hong)

It was the second major wildfire in the San Jacinto Mountains this summer. A blaze that erupted in mid-July spread over 43 square miles on peaks above Palm Springs, burned seven homes and forced 6,000 people out of Idyllwild and neighboring towns.

The latest fire also burned in the footprint of the notorious Esperanza Fire, a 2006, wind-driven inferno that overran a U.S. Forest Service engine crew. All five crew members died. A man was convicted of setting the fire and sentenced to death.

After touring the area, U.S. Sen. Barbara Boxer, D-Calif., who lives in Riverside County, said 165,000 acres have burned in California this year and climate change is setting conditions for more disastrous blazes, while budget cuts are limiting resources to fight them. (MSN, 8/9/2013)

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Wyoming Dominates Sales of Coal Produced from Federal and Indian Lands

Annual sales of coal produced from federal and Indian lands in the United States ranged between 458 million and 509 million short tons from fiscal year (FY) 2003 to FY2012. Over the same period, sales of coal produced from federal and Indian lands in Wyoming ranged from 356 million to 411 million short tons, 76% to 83% of the U.S. total.

Most of the coal being mined in the Wyoming portion of the Powder River Basin (PRB) is being produced from federal and Indian lands; Wyoming mines in the PRB are the largest in the United States. Total production of coal in Wyoming, as measured by the Mine Safety and Health Administration (MSHA), tracks closely with the sales of coal produced from federal and Indian lands within the state, as measured by the Interior Department's Office of Natural Resources Revenue. Using these sales as a proxy for production, Wyoming's federal and Indian lands production has been about 82% to 95% of Wyoming's total production over the past decade.

The revenue collected by the federal government from the sales of coal from federal and Indian lands within Wyoming ranged from a low of $303 million in FY2003 to a high of $638 million in FY2012. Under current law, 49% of the revenue associated with onshore federal lands goes directly to the state, and 100% of the revenue associated with Indian lands goes to the respective Indian tribes and individual Indian mineral owners.

Between FY2008, when coal production in Wyoming was at a record high level, and FY2012, coal production in the state declined 10%. Sales of coal produced from federal and Indian lands in Wyoming declined 9% in the same period. The decline seen in FY2009 can be attributed to the economic downturn that reduced electricity demand. The continuing decline through FY2012 reflects slow growth in electricity demand together with a reduced coal share in the generation mix because of relatively low natural gas prices and growing amounts of generation from renewable technologies, especially wind. (DOE-EIA)

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Federal Railroad Administration Tightens Oil Shipping Standards

The Federal Railroad Administration (FRA) plans to start asking shipping companies to supply testing data they use to classify their crude-oil shipments, saying it is concerned that some shipments are being transported in tank cars that aren't safe enough.

In a letter to American Petroleum Institute CEO Jack Gerard last week, the FRA said it is investigating whether some crude shipments contain chemicals—possibly from the hydraulic-fracturing process used to extract it—that make them more hazardous than their classification indicates.

 

 

Oil producers and refiners are increasingly using rail in North Dakota and Texas, where there aren't enough pipelines.

The agency told the API it also suspects that mixes of crude and other chemicals might be the cause of an increase in damage to tank cars caused by "severe corrosion."

If shippers can't supply their testing data, the FRA said in the letter, it will work with the Pipeline and Hazardous Materials Safety Administration to test the shipments independently.

Companies routinely add highly corrosive hydrochloric acid to fracking fluid to break down rock formations. They also add certain chemicals to kill microorganisms and reduce friction in oil. Frack fluids are exempt from federal disclosure laws, but some companies voluntarily provide details, and some states require a thorough ingredient list.

The action is the latest by the agency to toughen regulation of the transport by rail of crude oil after a runaway train hauling 72 tank cars with crude oil derailed and exploded last month, killing 47 people and ravaging the Quebec town of Lac-Mégantic. The Quebec disaster follows a number of serious accidents involving hazardous materials and tank cars in recent years that have raised federal regulators' concern.

More than 34 million barrels of crude were delivered to U.S. refineries by train in 2012, a fivefold increase compared with a year earlier, according to the Energy Information Administration, the statistical arm of the U.S. Energy Department. The volume is expected to increase again in 2013.

The FRA moves will likely pose difficulties for some shippers. Oil producers and refiners are increasingly using rail in Texas and North Dakota, where there aren't enough pipelines to get the crude to markets that will command the highest price.
(WSJ, 8/7/2013, Photo: Getty Images)

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Third LNG Facility Gets Permission to Export

The Obama administration approved natural gas exports from a third U.S. facility Wednesday.  The export terminal in Lake Charles, La., secured a conditional license from the Energy Department to ship liquefied natural gas to all countries. The terminal is backed by BG Group and Southern Union.

The department’s order gives the Lake Charles terminal permission to export up to 2 billion cubic feet of natural gas a day for 20 years. The approval is contingent on the Lake Charles terminal receiving a permit from the Federal Energy Regulatory Commission (FERC) for construction of the facility.

The decision came nearly three months after Freeport LNG’s terminal in Quintana Island, Texas, got the go-ahead. The United States has given the green light to 5.6 billion cubic feet per day of gas exports from three projects. That represents about 8 percent of daily U.S. gas output.

In 2011, Cheniere’s Sabine Pass terminal in Cameron Parish, La., was the first project to get permission from the Obama administration to export to countries not party to the Free Trade Agreement (FTA).

Federal law generally requires approval of natural gas exports to countries that have an FTA with the United States. For countries that do not have an FTA with the United States, the Natural Gas Act directs the Department of Energy to grant export authorizations unless the Department finds that the proposed exports “will not be consistent with the public interest.”

Some lawmakers and companies have complained that the government is not moving fast enough to approve LNG exports. Other firms, which have benefited from cheap domestic natural gas prices, have urged caution in approving applications.

The three projects approved by the Department of Energy would have the capacity to ship 5.6 billion cubic feet of gas a day, or about two trillion cubic feet a year. The U.S. produced about 25 trillion cubic feet in 2012.

Senate Republicans have urged the Department of Energy to move quickly to approve more export permits, in part because allies are lining up to buy U.S. natural gas. Foreign governments routinely express their concerns over long delays, as well as the uncertainty surrounding the timeline for review. Asian countries are particularly hungry for U.S. natural gas. Japan, which is seeking alternative fuels to generate electricity after shutting most of its nuclear power plants, has asked the U.S. to expedite approvals.

Although demand is strong, the U.S. is competing with Canada and other nations preparing export plants. Analysts say there is a limited window of opportunity to secure global buyers.

The Department of Energy has received requests to ship about 30 billion cubic feet of natural gas per day, but many analysts say fewer than 10 billion cubic feet of export capacity will actually be built. One major reason is the multibillion-dollar cost of building export facilities, which cools natural gas to negative 260 degrees Fahrenheit—turning it into liquefied natural gas, or LNG—before shipment.

The energy company Dominion Resources Inc. is next in line with its Cove Point project in Maryland, which is seeking approval to ship one billion cubic feet of natural gas a day.

Some U.S. manufacturers and their allies on Capitol Hill have questioned the wisdom of allowing unfettered exports, saying the result could be higher prices at home and less competitiveness for U.S. industrial companies that use gas as a feedstock. Several manufacturers—including Dow Chemical Co., Alcoa Inc. and Nucor Corp. —formed a coalition earlier this year to resist the wave of export proposals.  (Reuter, Wash Post, 8/8/2013, WSJ, 8/7/2013, DOE)

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Oil Boom Helps to Shrink U.S. Trade Deficit by 22%

America's trade deficit narrowed sharply in June, driven by record exports and a shrinking bill for oil imports.  The trade gap fell more than 22% during the month, to $34.2 billion from $44.1 billion, according to the Commerce Department.  Exports notched their sharpest rise since September 2012, hitting their highest level, adjusted for inflation, on record.

The most recent report in part reflects a strengthening domestic energy industry. Imports of fuel oil and other petroleum products fell, while exports of both rose. When calculated in 2009 dollars, the trade deficit in petroleum products fell by almost $2.2 billion from May to $10.23 billion; the trade deficit in non-petroleum products fell by $5.93 billion to $37.38 billion.

The U.S. imports far more from China than it exports. In June, however, imports from China edged down while exports moved up.   (WSJ, 8/6/2013)

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EPA Finalizes 2013 Renewable Fuel Standards

Addresses Concerns About the E10 Blend Wall

As part of an ongoing effort to enhance energy security and reduce carbon pollution, the U.S. Environmental Protection Agency (EPA) today finalized the 2013 percentage standards for four fuel categories that are part of the Renewable Fuel Standard (RFS) program established by Congress. Most of these fuels are produced by American farmers and growers domestically and help reduce the carbon pollution that contributes to climate change.

The final 2013 overall volumes and standards require 16.55 billion gallons of renewable fuels to be blended into the U.S. fuel supply (a 9.74 percent blend). This standard specifically requires:

• Biomass-based diesel (1.28 billion gallons; 1.13 percent)
• Advanced biofuels (2.75 billion gallons; 1.62 percent)
• Cellulosic biofuels (6.00 million gallons; 0.004 percent)

These standards reflect EPA’s updated production projections, which are informed by extensive engagement with industry and a thorough assessment of the biofuels market.

During this rulemaking, EPA received comments from a number of stakeholders concerning the “E10 blend wall.” Projected to occur in 2014, the “E10 blend wall” refers to the difficulty in incorporating ethanol into the fuel supply at volumes exceeding those achieved by the sale of nearly all gasoline as E10. Most gasoline sold in the U.S. today is E10. In the rule issued today, EPA is announcing that it will propose to use flexibilities in the RFS statute to reduce both the advanced biofuel and total renewable volumes in the forthcoming 2014 RFS volume requirement proposal.

EPA is also providing greater lead time and flexibility in complying with the 2013 volume requirements by extending the deadline to comply with the 2013 standards by four months, to June 30, 2014.

A January 2013 ruling by the U.S. Court of Appeals required the agency to reevaluate projections for cellulosic biofuel to reflect market conditions; the final 2013 standard for cellulosic biofuel announced today was developed in a manner consistent with the approach outlined in that ruling.

The Energy Independence and Security Act (EISA) established the RFS program and the annual renewable fuel volume targets, which steadily increase to an overall level of 36 billion gallons in 2022. To achieve these volumes, EPA calculates a percentage-based standard for the following year. Based on the standard, each refiner and importer determines the minimum volume of renewable fuel that it must ensure is used in its transportation fuel.  (EPA)

More information on the standards and regulations

More information on renewable fuels

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TransCanada Announces Tarsands Pipeline To Its East Coast

TransCanada, the Calgary-based company behind the proposed Keystone XL pipeline, announced that it would push ahead with a $12 billion Energy East Pipeline from Canada’s oil sands to the Port of St. John on Canada’s eastern coast. The new pipeline would carry 1.1 million barrels a day, more than a third more than the Keystone XL would.

TransCanada’s pipeline announcement is an expected but still bold step for the company, which has waited for years for a decision on its Keystone XL proposal to the U.S. Gulf Coast.

TransCanada plans to seek regulatory approval for the project from Canada's National Energy Board by the end of the year, and, if it succeeds, to start construction in 2016. Service to refineries in Montreal and Quebec City would begin the following year and then to Saint John in 2018.

The provinces through which the pipeline would pass will also have a say over the project.  TransCanada expects the Energy East project to proceed. Alberta and New Brunswick support the proposal. Quebec's position is unclear.

The new line would supply eastern Canadian refineries and would also provide export capacity through St. John. Some of that exported oil could go to U.S. Gulf Coast refineries. The 2,734-mile pipeline would enable producers to ship up to 1.1 million barrels of oil a day from Alberta and Saskatchewan to eastern Canadian refineries. The company has so far secured long-term contracts to transport about 900,000 barrels of oil a day through the proposed pipeline.(Wash Post, 8/1/2013, WSJ, 8/1/2013))

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Proved reserves of crude oil and natural gas in the United States up sharply in 2011

U.S. proved crude oil reserve additions in 2011 set a record volumetric increase for the second year in a row, according to newly published estimates in EIA's U.S. Crude Oil and Natural Gas Proved Reserves, 2011. Natural gas proved reserve additions fell short of setting a record, but still ranked as the second largest annual increase since 1977. Crude oil reserves rose 15% (almost 3.8 billion barrels) to the highest level since 1985, and natural gas reserves were up almost 10% (31.2 trillion cubic feet).

Proved oil reserves, which include crude oil and lease condensate, increased to 29.0 billion barrels, marking the third consecutive annual increase and the highest volume of proved reserves since 1985. Proved reserves in tight oil plays accounted for 3.6 billion barrels (13%) of total proved reserves of crude oil and lease condensate in 2011.

Texas recorded the largest increase in proved oil reserves among individual states, largely because of continuing development in the Permian Basin and the Eagle Ford formation in the Western Gulf Basin. North Dakota had the second largest increase, driven by development activity in the Bakken formation in the Williston Basin.

 

Combined, Texas and Pennsylvania added 73% of the net increase in proved wet natural gas reserves in 2011. Pennsylvania's proved natural gas reserves, which more than doubled in 2010, increased by 12.7 trillion cubic feet in 2011, contributing 41% of the overall gain in proved reserves. Proved reserves in shale gas plays accounted for 131.6 trillion cubic feet (38%) of total proved reserves of wet natural gas in 2011.

Natural gas proved reserves, estimated as wet gas that includes liquids in the natural gas stream, increased by almost 10% in 2011 to 348.8 trillion cubic feet (Tcf), the 13th consecutive annual increase. (EIA)

 

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Four Former EPA Adminstrators Support Climate Action

The New York Times

Op-Ed Contributors

A Republican Case for Climate Action

By WILLIAM D. RUCKELSHAUS, LEE M. THOMAS, WILLIAM K. REILLY and CHRISTINE TODD WHITMAN

Published August 1, 2013

EACH of us took turns over the past 43 years running the Environmental Protection Agency. We served Republican presidents, but we have a message that transcends political affiliation: the United States must move now on substantive steps to curb climate change, at home and internationally.

There is no longer any credible scientific debate about the basic facts: our world continues to warm, with the last decade the hottest in modern records, and the deep ocean warming faster than the earth’s atmosphere. Sea level is rising. Arctic Sea ice is melting years faster than projected.
      

The costs of inaction are undeniable. The lines of scientific evidence grow only stronger and more numerous. And the window of time remaining to act is growing smaller: delay could mean that warming becomes “locked in.”
      

A market-based approach, like a carbon tax, would be the best path to reducing greenhouse-gas emissions, but that is unachievable in the current political gridlock in Washington. Dealing with this political reality, President Obama’s June climate action plan lays out achievable actions that would deliver real progress. He will use his executive powers to require reductions in the amount of carbon dioxide emitted by the nation’s power plants and spur increased investment in clean energy technology, which is inarguably the path we must follow to ensure a strong economy along with a livable climate.
      

The president also plans to use his regulatory power to limit the powerful warming chemicals known as hydrofluorocarbons and encourage the United States to join with other nations to amend the Montreal Protocol to phase out these chemicals. The landmark international treaty, which took effect in 1989, already has been hugely successful in solving the ozone problem.
      

Rather than argue against his proposals, our leaders in Congress should endorse them and start the overdue debate about what bigger steps are needed and how to achieve them — domestically and internationally.
      

As administrators of the E.P.A under Presidents Richard M. Nixon, Ronald Reagan, George Bush and George W. Bush, we held fast to common-sense conservative principles — protecting the health of the American people, working with the best technology available and trusting in the innovation of American business and in the market to find the best solutions for the least cost.
      

That approach helped us tackle major environmental challenges to our nation and the world: the pollution of our rivers, dramatized when the Cuyahoga River in Cleveland caught fire in 1969; the hole in the ozone layer; and the devastation wrought by acid rain.
      

The solutions we supported worked, although more must be done. Our rivers no longer burn, and their health continues to improve. The United States led the world when nations came together to phase out ozone-depleting chemicals. Acid rain diminishes each year, thanks to a pioneering, market-based emissions-trading system adopted under the first President Bush in 1990. And despite critics’ warnings, our economy has continued to grow.
      

Climate change puts all our progress and our successes at risk. If we could articulate one framework for successful governance, perhaps it should be this: When confronted by a problem, deal with it. Look at the facts, cut through the extraneous, devise a workable solution and get it done.
      

We can have both a strong economy and a livable climate. All parties know that we need both. The rest of the discussion is either detail, which we can resolve, or purposeful delay, which we should not tolerate.
      

Mr. Obama’s plan is just a start. More will be required. But we must continue efforts to reduce the climate-altering pollutants that threaten our planet. The only uncertainty about our warming world is how bad the changes will get, and how soon. What is most clear is that there is no time to waste.  (NYT, 8/1/2013)     

The writers are former administrators of the Environmental Protection Agency: William D. Ruckelshaus, from its founding in 1970 to 1973, and again from 1983 to 1985; Lee M. Thomas, from 1985 to 1989; William K. Reilly, from 1989 to 1993; and Christine Todd Whitman, from 2001 to 2003.

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Duke Energy Writes Down $360 Million Over Crystal River Plant

Duke Energy Corporation will take a $360 million charge against earnings as part of a settlement with Florida's consumer advocate over how the utility will recover nearly $2.5 billion worth of expenses related to the nonworking Crystal River nuclear power plant. As a result of the settlement agreement announced Thursday with the state's Office of Public Counsel, Duke said it would take a $295 million charge related to the retirement of its Crystal River nuclear reactor and $65 million related to its decision to end efforts to build a new reactor in Levy County, Fla., about 120 miles north of Tampa.  Without the agreement, it is likely those costs would eventually have wound up in customers' bills.

The settlement, which still must be approved by state utility regulators, caps at $1.46 billion the amount that Floridians can be asked to pay for Crystal River, which is also north of Tampa on Florida's Gulf Coast. The plant's premature retirement, due the structural problems, was announced last February.

The deal also establishes that the expense won't be added to customer rates until after the utility has quit charging customers for money it is owed for the now-terminated Levy County nuclear project, possibly after 2017 or 2018.

Duke's Florida utility unit said the utility has spent about $1 billion on the Levy County project but so far had collected only $743 million from customers through June 30. The agreement was a good one for consumers and the utility because "it provides long term clarity about how nuclear expenses will be handled.  Though it ends ongoing legal wrangling between the utility and the state's chief utility advocate, the settlement means that consumers will pay nearly $2.5 billion for plants or projects that aren't generating electricity.

The utility also confirmed on Thursday that it has received $835 million from a nuclear insurance fund to compensate it for damage to the Crystal River reactor.  (WSJ, 8/1/2013)

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Shell Writes Down $2 Billion in Assets Due to Shale Difficulties

Royal Dutch Shell posted a 60% drop in second-quarter profit, largely because the oil and natural-gas giant wrote down the value of its North American shale assets by more than $2 billion after tax, highlighting the difficulties that energy companies face in finding new oil they can pump at a profit.  Shell cited disappointing drilling results at its North American shale assets, which it said turned out to contain less oil than it had hoped.

Shell also dropped its target to produce four million barrels of oil and gas a day by either 2017 or 2018. The company, which produced about three million barrels of oil equivalent a day in the past quarter, will instead focus on financial targets.  Royal Dutch Shell wrote down the value of its North American shale assets by over $2 billion after tax after disappointing drilling results.

 

Shell said it plans to spend about $40 billion this year, up from an earlier projection of about $33 billion and more than 30% higher than last year.

Tthe large oil companies are having troubles that  in capitalizing on the U.S. shale boom. After a decline in natural-gas prices hit Shell's U.S. operations last year, the company said this past January that it was trying to move to shale resources that were richer in oil, rather than less-profitable gas.

Shell declined to give the location of the assets whose value was written down. In North America, the company's shale acreage is located in Texas, Ohio, Pennsylvania, Wyoming, Kansas, Colorado, California and British Columbia.

Excluding the one-time charges, Shell's profit was $4.6 billion, down 20% from a year earlier. Revenue fell 3.8% to $112.67 billion from $117.07 billion.  (WSJ, 8/1/2013)

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Oregon and Washington Wildfires

Wildfires in Washington state and Oregon have blackened more than 200 square miles of terrain across the Pacific Northwest, forcing hundreds of residents to flee their homes. In Washington, some 1,700 firefighters worked to contain a pair of fires that have charred a combined 85,000 acres east of the Cascade Range, destroying at least three homes and several outbuildings.

The so-called Colockum Tarps fire, which broke out on Saturday morning and quickly spread through dry brush near Malaga, had burned over some 60,000 acres of mountain slopes toward the Columbia River by Wednesday afternoon.  Air tankers have dropped water and flame retardant to protect neighborhoods and power lines, he said. The Colockum, only about 8 percent contained, has forced 150 people to evacuate their homes south of Wenatchee.

In southwestern Oregon, a wildfire started by lightning on July 26 that had already burned over more than 25,000 acres was threatening 500 homes. Dubbed the Douglas Complex fire, it is made up of four large fires and 55 smaller blazes.

A few minor injuries have been reported among the 1,387 firefighters and support personnel battling the blaze, officials said. Crews were using 11 helicopters, 86 fire trucks, 15 bulldozers and 27 water tenders. (Various news sources)

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EPA Proposes Rule to Modernize Clean Water Act Reporting

E-reporting initiative will increase efficiency, ease burden for states and improve public access to data

The U.S. Environmental Protection Agency (EPA) has proposed a rule that would modernize Clean Water Act (CWA) reporting processes for hundreds of thousands of municipalities, industries, and other facilities by converting to an electronic data reporting system. The proposed e-reporting rule would make facility-specific information, such as inspection and enforcement history, pollutant monitoring results, and other data required by permits accessible to the public through EPA’s website.

EPA estimates that, once the rule is fully implemented, the 46 states and the Virgin Island Territory that are authorized to administer the National Pollutant Discharge Elimination System (NPDES) program will collectively save approximately $29 million each year as a result of switching from paper to electronic reporting.

Currently, facilities subject to reporting requirements submit data in paper form to states and other regulatory authorities, where the information must be manually entered into data systems. Through the e-reporting rule, these facilities will electronically report their data directly to the appropriate regulatory authority. EPA expects that the e-reporting rule will lead to more comprehensive and complete data on pollution sources, quicker availability of the data for use, and increased accessibility and transparency of the data to the public.

The CWA requires that municipal, industrial or commercial facilities that discharge wastewater directly into waters of the United States obtain a permit. The NPDES program requires that permitted facilities monitor and report data on pollutant discharges and take other actions to ensure discharges do not affect human health or the environment.

Most facilities subject to reporting requirements will be required to start submitting data electronically one year following the effective date of the final rule. Facilities with limited access to the Internet will have the option of one additional year to come into compliance with the new rule. EPA will work closely with states to provide support to develop or enhance state electronic reporting capabilities.

EPA has already scheduled several webinars in an effort to help states, trade organizations, and other interested parties better understand the details and requirements of the proposed rule. Over the next few months, EPA expects to schedule additional webinar sessions.

The proposed rule will be available for review and public comment for 90 days following the publication date in the Federal Register. (EPA)

View the proposed rule in the Federal Register

More information on webinars

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S. 1240: Nuclear Waste Administration Act of 2013

Sponsor: Sen. Ron Wyden [D-OR]

S. 1240, the Nuclearr Waste Administration Act of 2013 ia a bill [text] to establish a

Ron Wyden

new organization to manage nuclear waste, provide a consensual process for siting nuclear waste facilities, ensure adequate funding for managing nuclear waste, and for other purposes.

The Center was one of the first groups to recommend a nuclear waste management agency outside of the Department of Energy via its work with the Nuclear Fuels Reprocessing Coalition (NFRC). (Gov Track)

 

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Sunrise Powerlink Transmission Project

Sources: San Diego Gas and Electric,  Approved Route for Sunrise Powerlink

The Sunrise Powerlink Transmission project, which came online on June 18, 2012, adds approximately 800 megawatts (MW) of transmission capability to the Southern California electric grid. The new transmission lines, shown as blue and green lines on the map, will bring renewable energy from Imperial County to San Diego. The additional transmission capability will also help the Southern California electric grid address this summer's capacity shortage that resulted from the unplanned outages at the San Onofre nuclear generation station located near San Diego.

San Diego Gas and Electric, the owner and operator of this transmission line, announced on June 18, 2012 the activation of this 500 kilovolt transmission line. The project cost approximately $1.9 billion dollars and will eventually have a capacity of 1,000 MW.

The Imperial County region has significant solar, geothermal, and wind resources. The transmission line connects two proposed solar photovoltaic facilities under construction by Tenaska Solar Ventures as well as Pattern Energy's operating Ocotillo Wind Energy Facility—all of which are located in Imperial County. The Sunrise Powerlink path is indirect, skirting the Cleveland National Forest and the Campo Reservation as well as other sensitive ecological habitats.

The Sunrise project included the construction of the Suncrest substation (shown on the map at the intersection of the green and blue lines) as well as upgrades to seven other substations along the path through the control area of the Imperial Irrigation District. The project also interconnected with the control area of Southern California Edison's Edison International transmission system.

California imports significant supplies of electricity from neighboring systems, making transmission capability a critical reliability concern. (DOE-EIA)

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Utility Bill Payment Scams

Do Not Fall For The Scam

It appears to be going on all over the country

From: Mississippi Secretary of State

Mississippi businesses and residential customers are being targeted by con artists posing as Entergy employees who demand immediate payment for an alleged past due utility bill.

According to Entergy officials, the scammer calls a customer to say the electric bill payment is past due and threatens to cut off utility service within one hour unless payment is made immediately. Customers are then told they can transfer funds electronically, usually using a system referred to as “Money Pak.” This payment processing system is NOT authorized to receive funds for Entergy.
Entergy officials say the scam apparently started in Arkansas in May and then spread to Louisiana. The first reports of Mississippi scams were received late last week from three Jackson-area restaurants.

Entergy Mississippi warns customers not to fall victim to the scam. They remind everyone that Entergy never demands immediate payment of a past due bill.

• While Entergy does place courtesy calls if a customer is at risk for disconnection for past-due accounts, they are recorded calls made in advance of the cut-off date and are not from live customer service representatives.
• Entergy bills may be paid by phone using a credit or debit card, but only through Billmatrix, a third-party vendor under contract with Entergy.
• Customers should never give personal or financial information to strangers.
• If a phone call sounds suspicious, customers should call 1-800-Entergy (1-800-368-3749) and ask to speak with an Entergy customer service representative.

If any individual or business has been the target of such a scam or other attempts to defraud, they should immediately contact the Mississippi Attorney General’s Office of Consumer Protection at 1-800-281-4418 or 601-359-4230 to file a report. If customers are concerned their Entergy account has been affected, they can call 1-800-ENTERGY (1‑800‑368‑3749) to speak with an Entergy customer service representative.
More information on payment options for Entergy bills is available online at www.entergy.com.

From: Southern California Edison - - Press Release

Utility Bill Scams Continue to Target Southern California Edison Customers

ROSEMEAD, Calif., July 25, 2013 — Southern California Edison (SCE) is advising customers to be aware of a telephone scam that demands immediate payment for allegedly past due electricity bills.

Imposters have been calling SCE customers telling them they must make immediate payment on past due bills or have their electric service disconnected. The callers are also demanding that payment be made through a prepaid cash card. Other forms of fraud involve customers being asked to purchase prepaid debit cards. Scammers ask for the debit card number and collect the value deposited on the card.

SCE customers have reported about 800 instances of phone scams this year. About 150 residential and commercial customers have been victimized by some form of bill scam with the incidents costing them an average of $800 to $1,000.

“We ask our customers to be alert to these calls that demand immediate payment and threaten service disconnection,”  said Henry Martinez, SCE vice president of Safety, Security & Compliance. “Customers suspecting a fraudulent call should ask for the caller’s name, department and business phone number. If the caller refuses to provide this information, customers should terminate the call and report the incident immediately to local police or SCE at 800-655-4555.”

Los Angeles County District Attorney Jackie Lacey, whose office prosecutes crimes in about 80 cities within SCE’s service territory, joins the utility in warning consumers about telephone scams.

“SCE and the Los Angeles County District Attorney’s Office share a common interest in keeping Los Angeles County residents safe from bill scams and other financial crimes,”  Lacey said.  

“A first step to preventing financial scams — particularly among the elderly and in ethnic communities — is to educate the public,” she said. “When these crimes do occur, the Los Angeles County District Attorney’s Office is fully committed to prosecuting them to the fullest extent of the law.”

SCE also reminds customers to ask for identification when a stranger comes to the door or calls claiming to be a utility worker. SCE utility workers will provide verification, including their department and phone number, when asked.

In most cases, home visits by SCE are scheduled by the customer and SCE will confirm the appointment in writing. If there are any concerns, SCE and law enforcement officials suggest having the utility worker wait outside until their identity can be verified. 

SCE customers should also note that:

·      An SCE employee will never ask for money in person.

·      Never reveal your credit card, ATM or calling card numbers (or PIN numbers) to anyone.

·      If someone calls and requests you leave your residence at a specific time for a utility-related cause, call the police. This could be a burglary attempt set up by the caller.

·      Be suspicious of anyone who arrives at your house without an appointment asking to check an appliance, wiring or suggesting that there may be some other electrical problem inside or outside your residence.

·      For more ways customers can stay safe, please see sce.com/safety and read the safety tips section.

About the Los Angeles County District Attorney’s Office
District Attorney Jackie Lacey leads the largest local prosecutorial office in the country. Each year, the district attorney’s office prosecutes more than 60,000 felonies and 140,000 misdemeanors.  

 

About Southern California Edison
An Edison International (NYSE:EIX) company, Southern California Edisonis the largest electric utility in California, serving a population of more than 14 million via 4.9 million customer accounts in a 50,000-square-mile service area within Central, Coastal and Southern California. 

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Maryland Governor Releases Global Warming Mitigation Plan

Martin O'Malley

Maryland Governor Martin O'Malley released a global warming mitigation plan on Thursday at a summit on climate change with scientists, business leaders and environmental advocates.  The plan calls for increasing the amount of energy from renewable sources under the Maryland Renewable Energy Portfolio Standard to 25 percent by 2020. The program previously had set an 18 percent benchmark by 2020 and 20 percent by 2022.

The plan also calls for pushing legislation next year aimed at increasing the recycling rate statewide, because waste in landfills is a source of greenhouse gas emissions. Under the plan outlined by the governor, the state would strive to better utilize or recycle 60 percent of Maryland's government managed solid waste by 2020.

 

Maryland's county recycling rates already average around 45 percent.  Much of the framework includes environmental measures the O'Malley administration already has pushed through the Legislature. They include initiatives to develop offshore wind and boost solar energy policies.

 

An offshore wind initiative off the coast of Ocean City will take years to develop. It would increase monthly electricity bills for ratepayers by an estimated $1.50 a month, once energy is generated by wind turbines.  Environmental advocates note that Maryland is among the states most vulnerable to climate change and rising waters. The state has more than 3,000 miles of shoreline.  (Times Union, 7/25/2013)

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Gulf Rig Natural Gas Blowout: 47 Rescued

This photo released by the Bureau of Safety and Environmental Enforcement shows natural gas spewing from the Hercules 265 drilling rig in the Gulf of Mexico off the coast of Louisiana, Tuesday, July 23, 2013.

Natural gas flowed uncontrolled from the Hercules 265 oil drilling rig off the Louisiana coast on Tuesday after a blowout that forced the evacuation of 47 workers aboard a drilling rig.  No injuries or fires were reported. The federal Bureau of Safety and Environmental Enforcement (BSEE) says the blowout happened south of Grand Isle, about 55 miles offshore, where the water depth was reported as 154 feet.

Tuesday's blowout occurred near an unmanned offshore gas platform that was not currently producing natural. The workers were aboard a portable drilling rig known as a jackup rig, operated by Hercules Offshore. Hercules said in a news release that it was operating the rig for Houston, Texas-based Walter Oil & Gas Corp.

The Houston-based Talos Energy-owned platform sits over three wells in water 144 feet deep.  Energy Resource Technology LLC is trying to seal the well.

Walter Oil & Gas reported to the BSEE that the rig was completing a "sidetrack well" - a means of re-entering the original well bore.  The purpose of the sidetrack well in this instance was not immediately clear. Industry websites say sidetrack wells are sometimes drilled to remedy a problem with the existing well bore. It is a way to overcome an engineering problem with the original well. (Times Union, 7/23/2013)

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Kior Opens Wood To Oil Plant in Mississippi

A new wood-to-crude oil conversion facility opening this week in Mississippi. Source: Kior

Kior Inc. opened its first commercial-scale plant in Columbus, Mississippi last November to take in 500 tons of biomass a day and transform it into 40,000 gallons a day of gasoline and diesel.  The company’s technology uses catalysts to vaporize biomass, removing the oxygen and condensing the remainder to oil that can be refined into cellulosic gasoline, diesel and jet fuel. Silicon Valley powerhouse Khosla Ventures owns more than half of the five-year-old company, which is based in Pasadena, Texas.

If you think about the way nature makes crude oil, Kior just accelerates that natural process. Nature does it thermally; Kior does it catalytically. They start with the same material nature started with, compress that process from a million years, or a very long period of time, into literally seconds. They take solid biomass through a single-step conversion to renewable crude oil. And then they upgrade that crude oil to cellulosic gasoline and diesel.

Kior's next plant is planned for Natchez, Mississippi. International Paper Company shut down a paper mill there about 7 years ago. As the pulp and paper industry has continued to go down, Kior would imagine building these conversion units to convert their unused biomass. It's the tops of the trees, the limbs and the small trees from thinning the forest that have little or no market today, and Kior convert that to oil.

Kior sold out their plant in Columbus, Mississippi, before they ever broke ground. Their customers are Catchlight Energy LLC, which is a joint venture between Chevron Corp. and Weyerhaeuser Co., Hunt Refining Co. and FedEx Corp.  They see it as the most effective and least disruptive avenue for them to achieve their internal strategic renewable energy objectives as well as their near term Renewable Fuel Standard volumetric obligations [RFS2]. What the companies like about Kior is it's a thermo-chemical process. It's not a biological process. They like the fact that Kior produces fundamentally indistinguishable gasoline and diesel from what they do from petroleum.

Their significant customers will be both integrated oil companies as well as independents that are striving to satisfy their growing renewable fuel obligations under RFS2. In addition to that, there is a tremendous market of energy-conscious businesses, like FedEx, that are looking for cost-effective, non-disruptive, low-carbon, environmentally-friendly fuels solutions to continue to grow their business in a truly sustainable manner.  (Bloomberg, 11/8/2013)

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Company To Produce Jet Fuel From Overgrown Forest Wood

But Many Other Issues Are Plaguing 4 Forest Restoration Initiation

Concord Blue Energy, a German alternative-energy company, wants to produce 40 million gallons of jet fuel a year from wood harvested in the four overgrown northern Arizona forests.  The German company is so confident in its plan that it will start building facilities even before it obtains state environmental permits. 

An advisory group of university, non-profit and other organizations supporting the nation's largest forest restoration effort, known as the Four Forest Restoration Initiative (4FRI), is supporting the jet fuel production project.

Pioneer Forest Products, the embattled U.S. Forest Service contractor selected to do

the work for the 4FRI  enlisted Concord early in the project.

Concord claims that it can produce jet fuel from chips for no more than $2 a gallon, but airlines testing such fuels recently have paid more than $30. Another confounding variable is that Concord isn’t  sure what they would be expected to pay for a ton of wood harvested from the forest.

Regardless of the role jet fuel may play in reducing fire threats and restoring Arizona’s ecology, the program aims to reinvigorate Arizona’s timber industry to accomplish a thinning job that the federal government cannot afford to do alone.

Jerry Nicholls, Lance Barnum and Allen Reidhead
 discuss logging. Mark Henle/The Republic

Pioneer, which won the U.S. Forest Service contract more than a year ago, has so far thinned about 500 acres near Heber, above the Mogollon Rim. Its contract calls for it to thin 300,000 acres over 10 years, but the company so far has not secured financing for a needed mill and is asking the government’s permission to sell its contract to an unnamed company.  Pioneer’s contract is for the first 300,000 acres. An environmental study that could open about twice that much is now under review.

The lack of progress has drawn criticism from environmentalists and county officials who support the program but questioned the contract award. This week, the Center for Biological Diversity called on the Forest Service’s inspector general to look into the contract award and potential shuffling. Forest Service officials said Wednesday that they hope to decide within a month whether to allow Pioneer to sell out.

In other developments, large log piles are sitting idle and would have been hauled off already if a Heber-area biomass electricity plant slated to receive them had reopened on schedule.

Pioneer has not disclosed the company it wants to sell its contract to, but it is incorporated in Arizona, Pioneer says the company has the money to open the $230 million Winslow mill that his company has been unable to get financing to build.

Forest Service officials also have declined to name the company.

The initiative is meant to restore about a million acres of forests to conditions approximating what they were before the last century of fire suppression. Constant firefighting has allowed young trees and brush to crowd the forest and, ironically, threaten worse fires.  (The Republic/ AZCentral .com, 7/24/2013)

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