Energy Exchange

Root Causes Of Water Pollution From Oil And Gas Operations

By Scott Anderson / Published: March 13, 2012

I received a flurry of emails this morning congratulating me on comments I made that appeared in a Wall Street Journal article titled, “Faulty Wells, Not Fracking, Blamed for Water Pollution.”

It is a good article. It suggests that even if artificial channels created by hydraulic fracturing have not yet been shown to have caused drinking water pollution, action is required to correct pollution problems caused by other aspects of natural gas operations.

I would add three additional points to the information covered in the article:

While faulty well construction is a big problem, surface spills have caused an even higher number of underground water pollution cases attributable to oil and gas development. A recent study commissioned by the Ground Water Protection Council (GWPC) determined that roughly 70% of nearly 400 cases of ground water pollution caused by the oil and gas industry over two decades in Texas and Ohio stemmed from mistakes made at the surface rather than from downhole problems.
Why is it important that approximately one in 10 cement jobs requires remediation before the well is completed? This statistic doesn’t imply that one in every 10 wells is a pollution hazard. Instead, the high number of cement jobs that need to be repaired in order to keep wells from becoming pollution hazards illustrates that without careful oversight of cementing the frequency of problem wells could increase dramatically. During the years in which GWPC identified some 400 ground water pollution cases in Texas and Ohio, nearly 221,000 wells were drilled in those states. Fortunately, the cement jobs didn’t fail on 10 percent of those wells! But 35 of the 400 pollution cases were due to well construction problems – cement job failures were involved in many but not all of those 35 instances.
Although stronger regulatory oversight of well construction is needed, stronger oversight of hydraulic fracturing is also needed. No one should try to suggest that hydraulic fracturing is risk free. It is vital that regulators begin to more closely assess hydraulic fracturing plans and operations – especially in relatively shallow geologic contexts – to be sure that fractures will intersect neither drinking water nor transmissive faults or wellbores that in turn intersect drinking water.

To learn about aspects of oil and gas operations that need close regulatory oversight, see my blog, “If The Problem Isn’t Hydraulic Fracturing, What Is?”

Posted in Natural Gas / Tagged fracking | Comments are closed

“Good Jobs, Green Jobs” Explores Novel Financing For Energy Efficiency Upgrades

By Jamie Fine / Published: March 8, 2012

This commentary was originally posted on the EDF California Dream 2.0 Blog.

Increasing energy efficiency (EE) and renewable energy are two ideal ways to cut climate pollution. Yet financing for these types of projects is often limited.

California has proposed using on-bill repayment (OBR) to help close a financing gap for EE that some have estimated to exceed $10 billion annually. It would be the first statewide program of its kind in the country to use third-party financing to fund energy-related upgrades for any type of building.

The program allows private loans for building efficiency upgrades and renewable energy projects to be repaid through utility bills. Billions of dollars could be made available at attractive terms for a variety of buildings, including single-family homes where owners are upside down on their mortgages, small businesses, large commercial properties and multi-unit rental buildings.

At next week’s Good Jobs, Green Jobs Western Regional Conference in Los Angeles, a panel of experts will discuss how the program can make energy upgrades more affordable and create good, green jobs. This workshop will feature a description of OBR, provide a status update on regulatory developments, and consider program design tradeoffs.

The workshop, “On Bill Repayment Solves the Financing Puzzle,” will be hosted by Environmental Defense Fund (EDF) and moderated by our Chief California Economist, Jamie Fine. Brad Copithorne, EDF’s energy and policy specialist who designed the program will describe how it works and how energy users can take advantage of the program to save money on energy bills and hedge against higher energy prices.

Other panelists include: Gretchen Hardison, Environmental Affairs Officer, Los Angeles Department of Water and Power; John Rhow, Director, Barclays Capital; and Neil Alexander, Account Manager, Utility Solutions Group, TRANE. These experts will share their perspectives on the program, and how it can be designed to meet the unique needs of their constituencies.

EDF looks forward to hosting the panel and discussing ideal ways to shape the final program. We are expecting California’s Public Utilities Commission to soon decide whether to offer OBR to all utility customers as a way to reduce energy use, grow the economy and protect public health and our environment.

Posted in California, Energy Efficiency, Jobs, On-bill repayment / Tagged OBR | Read 1 Response

Volt’s Speed Bump Is Neither Shocking Nor Alarming

By EDF Blogs / Published: March 5, 2012

By: Jamie Fine, EDF Economist, and Colin Meehan, EDF Clean Energy Analyst

Source: Technorati

Last Friday’s move by General Motors (GM) to briefly suspend production of the Chevy Volt must not be misconstrued as a sign that the car is failing to advance American leadership in building a clean energy future.

Just a few short years ago, it was widely argued that America’s vehicle manufacturers could never again be healthy competitors in the global marketplace. They simply lacked the vision, discipline, and innovation skills necessary to re-invent themselves, it was said.

Today, many of those same doom-sayers are again selling American manufacturing short. GM blames those critics for the pause in Volt production, saying they have treated the car as a “political lightning rod.”

GM has a point. With Volt production by its 1300 Michigan employees slated to resume in April, the critics are missing the real story behind the Volt and other electric vehicles in production and under development. That is the story of steady and determined progress toward American leadership in building the clean, reliable, safe and sought-after vehicles Americans want to buy. With that progress comes the promise of new jobs, a cleaner environment, and reclaimed pride and competitiveness of America’s manufacturers. For GM, the Volt symbolizes the company’s technological prowess in its most profitable year ever.

Lost in the gloomy rhetoric about the Volt is some genuine good news: the Chevy Volt and Nissan Leaf are actually beating the sales history of their hybrid cousins. When the Toyota Prius and Honda Insight were offered as the first commercially available hybrids in 2000, only 9,350 cars were sold. By the end of their first year, over 17,000 Nissan Leafs and Chevy Volts were sold. This is a particularly impressive debut considering the headwinds they have faced in terms of negative publicity and technological hurdles.

The Prius is now among the best selling cars in the U.S. with over 2 million vehicles on the road. Most major auto manufacturers now offer hybrid vehicles, from Buick to BMW to Hyundai. The same can be said for electric vehicles (EV) today.

Fueleconomy.gov, the “official U.S. government source for fuel economy information,” lists 16 new models coming out over the next few years and another six models planned for limited release and testing. Ford, Honda, Toyota and Mitsubishi have new electric or plug-in hybrid models coming out this year, with Ford and Toyota each offering two new models this year.

Innovations in EV technology, production economies of scale and rising gasoline prices continue to improve the value proposition for EVs. In just one example, an important breakthrough announced by GM-backed Envia will reduce the cost of EVs most expensive component–the battery–while extending driving range.

Electric vehicles can be fueled by almost anything, from wind and solar to natural gas power, which makes them possibly our greatest asset in any effort to reduce our dependence on foreign fuel supplies. For all the increased oil production in the U.S. over the past few years, our domestic supplies remain a drop in the bucket compared with our consumption.

Electric vehicles aren’t just about saving money or achieving energy independence. A number of recent studies, such as the latest from Lawrence Berkeley National Lab, find that vehicle electrification is a necessary part of any meaningful strategy to fight climate change.

Fortunately, the future for electric vehicles remains bright. But don’t believe us, just ask the automakers. “Most major auto manufacturers have announced their EV and/or PHEV production plans, which add up to 0.9 million units by 2015 and about 1.4 million units per year by 2020,” wrote Lew Fulton Senior Transport Analyst at the IEA.

Whatever politically motivated attacks may be aimed at EVs, and whatever shortcomings these revolutionary new vehicles may display, one thing is certain: the move to EVs represents a rebirth of confidence in American innovation, workers, and competitive manufacturing. It also marks an irreversible national commitment to building a cleaner, more fuel-efficient transportation system for a prosperous American future.

Posted in Grid Modernization / Tagged Electric Vehicles, EV | Read 1 Response

EDF Teams Up With Honest Buildings To Accelerate The Development Of High Performance Buildings

By Jim Marston / Published: February 22, 2012

We announced today that EDF is working with HonestBuildings.com (Honest Buildings) to accelerate the number of energy upgrades, renovations and sustainable building projects throughout the U.S. Honest Buildings is a rapidly growing social networking website that offers energy efficiency vendors and service providers an ideal platform to showcase their work, connect with clients and generate new business. It also helps people find and share information about buildings, their owners, their occupants and the people who service them.

Collectively, we need to do more to tell the story behind what’s driving improvements in the built environment, which consumes 70% of electricity in the U.S. and emits more than a third of greenhouse gases. By providing transparent information about buildings and their performance, we believe Honest Buildings is a powerful platform to do just that.

As part of EDF’s Energy Innovation Series, every week we will select one project from Honest Buildings to feature on edf.org/energyinnovation and promote through the series’ social media channels. By showcasing the most innovative and effective energy efficiency projects, EDF and Honest Buildings are working together to raise awareness and accelerate market adoption of smarter and more energy efficient buildings.

Posted in Energy Efficiency / Comments are closed

Austin Energy’s Electric Rates Are Lower Than The Texas Public Policy Foundation Would Have You Believe

By / Published: February 22, 2012

Austin Energy’s Residential Rates: 12% Below the Average Rate in ERCOT’s Competitive Markets – After Accounting for the Proposed 14.4% Rate Increase

Austin Energy has been in the news a lot lately, and most often for some controversy around the ongoing rate review process. What often gets lost in these heated discussions is that fact that Austin’s heritage of clean energy and innovative approaches to economic development are firmly rooted in our city’s electric utility, and that the utility allows city leaders to keep taxes low. At the same time, Austin Energy’s leadership often puts it in the crosshairs of groups that are ideologically opposed to clean energy and city owned utilities, and whether supported by facts or not, the opportunity to criticize Austin Energy has proven too difficult to resist.

(Source: www.inhabitat.com)

The Texas Public Policy Foundation (TPPF) is often one of the ringleaders in the crusade against clean energy as well as city owned utilities, and they’re not going to let facts get in the way of scoring an ideological point. In knocking Austin Energy and promoting their agenda, TPPF cherry picks data and uses coded language like the idea that customers “can choose” rates lower than Austin Energy’s if they are in the competitive regions of the Electric Reliability Council of Texas (ERCOT). The truth is, for a customer in the competitive areas of ERCOT to maintain lower rates than Austin Energy they would have to change electric providers each month, and they’d have to be pretty lucky on top of it.

The problem is that the rates TPPF reference when they say customers can choose lower rates are usually introductory, variable or otherwise subject to increases not included in the rates that customers do choose. What this means is that customers actually pay more than TPPF’s selective math would suggest, but TPPF seems more concerned with scoring political points than what customers actually pay for their electricity.

Look at the data from a more logical point of view and you will see that competitive regions in ERCOT average higher residential rates than ERCOT’s average rates. In fact, ERCOT rates are kept low largely by municipal and co-operative utilities like Austin Energy, the customer owned utility model that TPPF criticizes in their latest missive. The most recent data available for a real analysis of the rates Texans pay was released by the Energy Information Administration just a few months ago, including data through 2010. As the chart below shows, Austin Energy’s rates are well below the ERCOT average, and even farther below the average competitive market rate, despite TPPF’s claims to the contrary.

Source: Energy Information Adminstration (EIA)

Even if you account for Austin’s proposed 14.4% residential rate increase through 2015, the the new rates are 12% below current competitive rates in ERCOT. This calculation doesn’t even take into account the fact that nominal retail energy prices in ERCOT are projected to go up by 11% by 2015 according to the Energy Information Administration. Taking this projected rate increase into account it’s clear that Austin Energy’s rates – even after the rate review is completed – will be below the competitive average.

As we talk about rates in our community and across Texas, it’s important to remain focused on factual analysis and avoid misleading assumptions driven more by ideology than a desire for real debate. Unfortunately, arguments like those put forward by TPPF don’t contribute to an honest discourse; they mislead the public, distort reality, and threaten Austinite’s low tax lifestyle.

Posted in Texas, Utility Business Models / Read 6 Responses

A Triple Bottom Line for the Central Valley: Environment, Economy, Equity

By Jorge Madrid / Published: February 21, 2012

This week the Air Resources Board (ARB) held a public workshop in Fresno, California, to gather public input on ways to invest proceeds from California’s cap-and-trade auction. ARB heard from a wide variety of individuals and organizations with bright ideas on how to spend this money on projects that can lower greenhouse gases (GHG) and maximize the benefit to disadvantaged communities who are the most vulnerable to climate change and pollution impacts.

I represented EDF at the workshop, and an extended version of my public comments follows:

Posted in California, Cap and Trade, Clean Energy, Energy Efficiency, General, Renewable Energy, State / Comments are closed