Comments by Geoffrey Styles Subscribe

On What hurdles remain for E15 ethanol?

Dan,

Isn't the ethanol industry asking the wrong questions, here?  Instead of focusing on how they can force E15 into the market, shouldn't they be asking themselves why retailers and consumers would want to have anything to do with it?  After all, as you point out, station owners would be taking on both investment (new pumps that are certified for higher-ethanol blends) and new liabilities (cross-fueling and engine damage), but for what return?  And why would a consumer want to pay the same price for a fuel with 2% less energy content, resulting in 2% worse mpg and range in most cars?  Ethanol producers should be pondering how their industry could make E15 a better deal for consumers and retailers.

On New Jersey solar installers seek “Endless Summer” at ratepayer expense

Michael,

If recent SREC levels of $100-150/MWh--in other words a subsidy of $0.10-0.15/kWh over and above the market value of the power generated--are not sufficient to support continued solar installations in New Jersey, despite falling solar panel costs, what does that say about the pitfalls of putting solar in places with mediocre solar resources? 

On Are Canada's oil sands to blame for rising atmospheric CO2?

David,

Reserves, potential resources and production are not interchangeable, and apocalyptic statements that depend on conflating them are thus fundamentally flawed.  Your cogent analysis makes this crucial distinction well. It just needs a bigger audience.

On Are Chesapeake's Problems A Red Flag For Shale Gas?

Thanks. There's a big difference between unproved technically recoverable resources--the basis of the EIA estimate I cited--and proved reserves.  However, "environmentally and socially acceptable" look like much bigger uncertainties than the resources. 

I'm sure there are plenty of surprises ahead, but I think you'd be making a serious error in assuming they're all to the downside. 

On Are Chesapeake's Problems A Red Flag For Shale Gas?

Alain,

If you want to know what's in the fracking fluid, see: http://fracfocus.org/

And diesel is hardly used at all, any more, and even where it is, I'm not sure I understand the concern about injecting one hydrocarbon into a reservoir filled with other hydrocarbons.

On Are Chesapeake's Problems A Red Flag For Shale Gas?

Rick,

The energy security benefits of using natural gas in transportation are compelling.  Unfortunately, the whole energy security argument has been debased by the advocates of every energy source imaginable trotting it out in support of their preferred technology.  Yet unlike the entire suite of renewable electricity technologies--wind, solar, geothermal, wave and tidal--which might help global and local environmental concerns but do nothing at for energy security because they compete with other domestic energy sources, displacing gasoline and diesel with natural gas is a clear win on this front.  The fleet and infrastructure issues aren't trivial, but the technology is readily available and proven.

On Are Chesapeake's Problems A Red Flag For Shale Gas?

Bill,

When it comes to such decisions, there isn't a "gas industry" acting collectively, but rather a bunch of individual producers, all of which function as price-takers.  They can cut back, but can they be sure that enough others will follow suit to raise the price?  If not, they're just slashing their own revenue further.  And yes, lease terms have played a role at least from a drilling perspective, resulting in more new wells than might otherwise have been drilled.  (And new wells that put the most pressure on supply, because output is highest at the start of production.)

On Are Chesapeake's Problems A Red Flag For Shale Gas?

Rajat,

Your analogy to electricity is worth considering.  It also occurs to me that throughout during most of the period in which the utility industry learned to "manage production and demand" its companies were treated as regulated monopolies, at least in the US.  The gas industry is constrained by anti-trust considerations that might impede some similar approaches.

On Are Solar Subsidizers Making the Same Mistake as Oil Producers in the 30's?

Maury,

Let's ignore the entirely gratuitous personal jabs and get down to facts.  First, I've looked at your SSP formula and conclude that it's easy to make ground-based solar look better than the space-based variety if you assume a 40 year life for the former--despite current systems having operated for only a fraction of that in the real world and generally being warranted by their manufacturers for only 20-25 years.  Second, although you cite the 20% degradation factor over that period I don't see it applied to the calculated output.  Finally, and most importantly, I don't think you have any idea what my actual, nuanced views of SSP might be, so why drag this red herring into a discussion about Ontario FiTs???

That brings us to more relevant issue of peak power, which ground based solar overlaps but only for a portion of its output.  So while some fraction of the daily output of a PV module in Ontario might compete with high-priced peak sources, the rest might be mid-peak at best.  And how do you explain $1/kWh peak power prices when the LCOE of a simple-cycle peaking turbine is closer to the $0.25/kWh floor you cite?

On How CBO Got it Wrong on Fuel Consumption and the Highway Trust Fund

Deron,

I think you're doing CBO a disservice in the way you've characterized their findings.  On the CBO page to which you linked I see in plain English and large, bold print:"To Illustrate the Effect of a 21 Percent Reduction, CBO Applied That Reduction to the Cash Flows of the Highway Trust Fund Over the 2012–2022 Period."  In other words, the figures you're disputing are clearly labeled as hypothetical.

This is an issue near and dear to my heart, and like you I've been preaching for some time that we can't continue to rely on a per-gallon gas tax to fund our highway infrastructure, if our goal is to improve fuel economy and switch vehicles to non-liquid fuels.  However, it's also a classic boiling frog problem, because the reductions in funding due to the new CAFE standards are both gradual and largely deferred, because the CAFE doesn't go into effect immediately and because it will take so long for new-car fuel economy to move the needle on total fuel economy in a 240-plus-million-car fleet, only about 6% of which turns over even in a good year. The CBO obviously concluded that only showing the full impact that we eventually face would get lawmakers' attention at a time when the nearer-term figures are lost in the rounding, and the Congress has so many trillion-dollar problems on its plate.

On Are Solar Subsidizers Making the Same Mistake as Oil Producers in the 30's?

Alex,

You've drawn an interesting analogy, but I think you've missed the more serious waste: paying either $0.80 or $0.55/kWh for power that is worth only a fraction of that.  As a result, the implied cost of the paltry avoided CO2 emissions must be far above any reasonable value based on a comparison with either emissions markets or alternative emissions reduction projects.  The root cause of this waste is an overly generous incentive for putting solar in a northern location with poor solar resource--like drilling into one of those cut-off oil pockets you referenced.  Compared to that waste, some unused rooftop space seems like a bagatelle.

On Delta Buys Oil Refinery; Should Others Follow?

Christina,

Before all those heating oil customers band together to buy a refinery in the Northeast, perhaps they should ask themselves why facilities with replacement costs of several billion dollars would sell for such a big discount.  The answer is that owning the refinery is just the start of the costs they would take on, with the largest being for imported crude oil--there's no local production, thanks to a long-term offshore drilling ban--and other energy and inputs to run it.  They would also need to think about the investments that will be required to meet future environmental regulations.  What matters to the refinery owner, as Delta will learn, is margins, and those haven't been high enough for ConocoPhillips or Sunoco to justify continuing to operate these refineries themselves.