A group of five Scandinavian nations agreed Wednesday to objectives that build upon goals outlined in the president's June speech on climate and energy.
The international push aims to cut carbon emissions domestically and curtail financial support for new coal plants abroad. But developing countries rely heavily on the carbon-heavy fuel, and critics of the plan say it will slow the spread of electricity to regions of the world without it.
"Climate change is one of the foremost challenges for our future economic growth and well-being," reads the joint statement by Denmark, Finland, Iceland, Norway, Sweden, and the US. "We underscore the importance of continuing to encourage innovative approaches to promoting energy efficiency and clean energy, including renewables, and of taking action on climate change, domestically and internationally."
RECOMMENDED: Top 10 states for clean tech
While emissions are down in the US and other Western countries, they are ballooning elsewhere. Carbon-heavy coal is fueling the emerging economies of China, India, and other countries – sometimes with the US financing the construction of new plants. ( Continue… )
Although Latin America’s oil production has grown steadily in recent years, the region’s refineries have been unable to keep pace with rising demand, particularly in the transport sector. The shortfall has prompted Victorio Oxilia, president of the Latin American Energy Organization (OLADE), to declare the increase in petroleum product imports one of the region’s most pressing energy concerns.
There are several reasons for this. One is simply insufficient investment in local refining capacity. This is changing, with several projects underway. Interestingly the Chinese, who have been significant financiers of upstream oil operations across Latin America, have begun investing in the downstream sector. The China National Petroleum Corporation’s (CNPC) investment in the $12 billion Pacific Refinery in Ecuador is just one example, and we are likely to see more in coming years.
RECOMMENDED: Think you know energy? Take our quiz.
Another reason for the region’s relative decline in refining capacity is tightening regulations, meaning that pre-exciting refineries are unable to produce the quality of gasoline or diesel that meets national standards. Constructing more complex refineries capable of producing various fuel grades requires enormous investment. ( Continue… )
On his way back from the Yalta conference in February 1945 where US President Franklin D. Roosevelt met with Great Britain’s Winston Churchill and the Soviet Union’s Stalin, the American president made an unscheduled stop in Egypt where he met with Saudi Arabia’s King Abdel Aziz ibn Saud aboard the USS Quincy, in the Suez Canal’s Great Bitter Lake. The basis of the meeting was to ensure that Americans would have an uninterrupted supply of oil.
Oil in fact was the only thing that these two very different men had in common. Oil was the common thread binding Arabs and Americans. The Arabs produced it in large quantities and the Americans consumed it in large quantities.
Over the past several decades US presidents and Western European leaders had to worry about how any policy decision taken by them would affect the cost of gas at the pump, and thus ultimately, affect their own careers. As one can easily imagine, no politician in the world would want to be blamed for having been the cause of raised prices at the pump. (Related article: Saudi Prince Bandar Schemes in Syria)
With that in mind, policy makers in the Western Hemisphere pussyfooted around the thorny issue of how to handle the Middle East, careful not to upset too much the Arabs and in the process trigger the alarm that would punish the West with higher oil prices. As has happened in 1973 during the October War between Israel and its Arab neighbors when the oil producing countries slapped an oil embargo on the West. ( Continue… )
Syria's relative lack of oil and the rest of the world's growing abundance of it means a US strike on the country is unlikely to immediately disrupt production of one of the world's most prized commodities.
But the oil market is on edge for reasons beyond Syria. And those threats are likely to keep oil prices elevated, with or without military action by the United States and its allies.
The threat is that violence in Syria will spill over to other nations. Even a limited Western intervention there could ripple across the Middle East, analysts caution, aggravating sectarian violence that is already crimping production.
"It’s not that it’s the strike itself," said Mihaela Carstei, deputy director for the energy and environment program at the Atlantic Council, a global think tank based in Washington. "You have to think beyond the immediate ... It could have a longer lasting impact, because it’s about the perception of the US going in again."
That long-term impact could extend well beyond Syria, Ms. Carstei said in a telephone interview, destabilizing oil-rich neighbors in the Middle East and North Africa.
"In a post-strike environment the most likely supply impact would be on Iraq," wrote Guy Caruso, a senior adviser in the energy and national security program at the Center for Strategic and International Studies, a Washington-based think tank. "Sunni-Shite tensions would be exacerbated, which could affect Iraqi exports most likely through pipeline damage."
In North Africa, Libya's oil industry is already struggling to recover from the 2011 civil war that toppled Muammar Qaddafi. Strikes at ports and pipelines have cut exports to around 80,000 barrels per day (bpd). That's less than a tenth of the country's capacity.
Oil theft has plagued Nigeria. Production there is at a four-year low, down to 1.9 million barrels per day (bpd) from about 2.1 million bpd in 2012.
All told, supply cuts in the Middle East and North Africa have risen above 3 million bpd. That's about 3.5 percent of global demand.
Oil prices are already creeping upward, with New York Mercantile Exchange futures hitting a high of more than $110 a barrel on Aug. 28. Prices fell $1.38 to $107.16 a barrel Wednesday after President Obama spoke in Stockholm.
The recent move is a "typical paper markets effect," according to Giacomo Luciani, adjunct professor of international affairs at The Graduate Institute, Geneva. Driven by a fear of a price increase, investors buy, thereby increasing prices.
"Such fundamentally irrational price movements are common and inevitable and the industry has learned to live with them, unless for some reason they persist over time and prices are driven in a direction not supported by fundamentals for an extended period of time (several months)," Mr. Luciani wrote in an e-mail.
Even a decade ago, these threats would have been enough to send the price of oil soaring on world markets. The response is less frenzied today because of the Middle East's waning influence on global oil markets.
New drilling techniques have opened up vast reserves of previously inaccessible oil and natural gas in the US. That "shale boom" could well spread to Europe and Asia. Increased efficiency measures have driven demand down, and renewables offer even greater hope for energy independence
In the short term, the Obama administration could mitigate the effects of a potential strike by coordinating with allies in the region and elsewhere to increase oil output and plan for the possible drawdown of emergency supplies, Mr. Caruso wrote in an e-mail.
Still, the situation is far from stable, analysts said.
"Should the conflict in Syria continue to evolve as it has in recent months, compounded by the strike, neighboring countries (e.g., Iraq and possibly even Iran) could be dragged deeper into it, raising the risk of supply disruptions," wrote John Calabrese, a professor at American University and a scholar in residence at the Middle East Institute in Washington.
On the 23rd of August Tesla officially opened its Tilburg Assembly Plant, their first assembly plant in Europe, allowing some of the very first European customers, from Holland, Belgium, France, and Germany, to receive their Model S cars.
The assembly plant is located in the Netherlands, where Tesla believes that it will be perfectly situated to deliver vehicles to all corners of the European market.
Clean Technica reports that the 18,900 square metre plant will receive nearly complete Model S vehicles from US manufacturing plants, before finally assembly and then shipment to customers around the continent. (Related article: Elon Musk Turns his Eye on Iron Man’s Technology)
RECOMMENDED: Think you know Tesla Motors? Take our quiz!
Tilberg offers a central location for deliveries to anywhere in Europe within 12 hours. It is linked to the mainland continent via an excellent rail and motorway network, and is just 50 miles from the port of Rotterdam. ( Continue… )
Last year Maryland Governor Martin O’Malley asked the Energy Future Coalition (EFC), a project of the UN Foundation, to design a multi-faceted and comprehensive pilot-project plan for the state’s utilities. EFC assembled a stakeholder group including two Maryland utilities, PEPCO and Baltimore Gas & Electric Company (BGE), to submit ideas for pilot projects that could build a “better utility future.” The resulting report, “Utility 2.0: Piloting the Future for Maryland’s Electric Utilities and their Customers,” takes a different path than typical electricity utility reform strategies. Rather than dictating a single pathway for higher renewable penetration, the report calls for a number of pilot projects designed to create an entirely new grid system that advances innovation, resilience, reliability, flexibility, and financial viability for customers.
Electric utilities are usually characterized as ‘anti-innovators’ as their ultimate goal is only to sell electricity at the lowest cost and highest reliability. Integrating and transmitting distributed renewable energy presents a challenge to the standard operation of utilities due to intermittency issues, distribution, and new infrastructure needs.
Conventional policy suggests that utilities must be regulated into conforming to a renewable future. The Maryland study indicates an alternative path for implementing complementary policies necessary for bringing energy innovation to the utility system. ( Continue… )
A joint US-Israeli missile test gave energy markets a jolt Tuesday, sending up oil prices on concerns an attack on Syria would disrupt oil production in the region. That would almost certainly send oil prices rocketing higher and threaten a global economy that is emerging in fits and starts from the Great Recession.
But if a major disruption were to occur, the United States has an ace up its sleeve: hundreds of millions of barrels of federally-owned oil stored in massive underground salt caverns along the coastline of the Gulf of Mexico.
Three times in the past four decades, the US has made emergency releases from the Strategic Petroleum Reserve (SPR) to slow a rise in oil prices. And it would do so again.
So far, oil prices haven't reached a trigger point, analysts say, but they're getting closer. ( Continue… )
The National Renewable Energy Laboratory (NERL) has released a study, called ‘Beyond Renewable Portfolio Standards: An Assessment of Regional Supply and Demand Conditions Affecting the Future of Renewable Energy in the West’, which predicts that wind and solar electricity generation installations will become cost-competitive, without the help of federal subsidies, by 2025.
Several states in the western US have set up standard requirements needed for developing a renewable portfolio, which will be the primary drivers of any large scale expansions in wind, solar, and geothermal power generation capacity.
David Hurlbut, the senior analyst at the NREL, said that “the electric generation portfolio of the future could be both cost effective and diverse. If renewable and natural gas cost about the same per kilowatt-hour delivered, then value to customers becomes a matter of finding the right mix. (Related article: Wind Energy Spreading Beyond Europe)
RECOMMENDED: Top 10 states for clean tech
Renewable energy development, to date, has mostly been in response to state mandates. What this study does is look at where the most cost-effective yet untapped resources are likely to be when the last of these mandates culminates in 2025, and what it might cost to connect them to the best-matched population centers.” ( Continue… )
As always, the markets are roiling in anticipation of a US-led attack on Syria, and the ensuing trouble that such an attack could cause in the Middle East, and its impact on global oil production and supplies.
On the New York Mercantile Exchange, West Texas Intermediate crude oil jumped more than $3 a barrel on Tuesday to begin trading on Wednesday at $110.45. Gasoline prices in the US have risen the most in six weeks despite most analysts having predicted a fall in price in line with the traditional seasonal decline in demand.
The problem is that any conflict in the Middle East runs the risk of spilling over into the other countries, potentially impacting on crude oil production and supplies to the rest of the world via the Straits of Hormuz. (Related article: Has the Shale Bubble Already Burst?)
This time, however, for the first time in 50 years, the US is not as worried about disruptions to the oil markets and potential short term spikes in price, resulting from conflict in the Middle East, as domestic production, driven by the shale boom, is at a 20 year high. ( Continue… )
The SPR Grew Without Buying A Barrel
Although mainly focused on the oil market’s current jitters over Syria, Liam Denning’s Wednesday “Heard on the Street” column in the Wall St. Journal neatly highlights the extraordinary degree to which resurgent US oil production and weaker US demand have boosted the effectiveness of US oil inventories, including the US Strategic Petroleum Reserve (SPR). Without adding a drop — the SPR actually shrank a bit in 2011 — the reserve’s potential to replace daily imports in a crisis has soared as those imports have declined.
In the near term this could prove extremely helpful should expected US-led reprisals against the Syrian government result in a regional disruption of oil flows. Longer term, it serves as a further reminder that the existing SPR was designed for another era and is overdue for a major rethink.
An Imperfect Backstop
Having 700 million barrels of oil in federal facilities along the Gulf Coast has tempted presidents and other politicians, who saw opportunities to benefit from using it to attempt to crush periodic gasoline price spikes. However, the current situation comes much closer to the scenarios the SPR was intended to address when it was begun during the Ford administration, to provide a backstop for our vital energy supplies in emergencies involving a physical interruption of supply. When it comes to uses of the SPR, I’ve always been a purist, perhaps because I can recall sitting in gas lines and participating involuntarily in the bizarre “odd-even” rationing-by-license-plate scheme introduced during the oil crisis following the Iranian Revolution in 1979.
Here’s how the benefits of tapping the SPR in an actual crisis have improved, based on the rapid recent drop in US oil imports. In 2007, the SPR could have replaced just over half of our crude oil imports from countries other than Canada or Mexico for 165 days, at its maximum draw-down rate of 4.25 million barrels per day (MBD). With its current inventory and this year’s average crude oil imports through May running at around 7.6 MBD, the SPR could substitute for 100% of our non-North American imports for 163 days. The value of such an insurance policy is rarely appreciated until it is needed. ( Continue… )