Friday, November 28, 2014

OPEC Maintains Output - Prices Decline

In an earlier post, see link, the disarray in the world energy markets was discussed in view of OPEC's upcoming meeting in November, 2014.  

That meeting is now over, and OPEC chose to maintain oil output.  The effect will be for world crude oil prices to continue their fall.  Today's stock prices fell for major energy companies.   

Much has already been written about the likely effects of the lower oil prices.   Transportation costs for many will decrease as the crude oil prices work their way through the refining and marketing systems.  Consumers will have more disposable income, and will likely spend that rather than save. Some, though, will pay down debt.  

Oil-based chemicals and derivatives will also see price reductions, which will also benefit consumers.  

The long-term impact on nuclear power plants, both new and existing, will be to make them more and more un-economic.  Natural gas price, in many countries, is tied at least loosely to the price of oil.  Falling oil prices mean falling natural gas price, and a nuclear plant will have ever more difficulty competing with the power price from the natural gas-fired plants.  This is especially true of the combined-cycle gas turbine plants with the highest efficiencies.  see link  

Roger E. Sowell, Esq.
Marina del Rey, California
copyright (c) 2014 Roger Sowell

Sunday, October 26, 2014

Thoughts At 75000 Pageviews

Today the pageview counter at SLB turned over 75,000 pageviews, another milestone of sorts.   These views are from a bit more than 39,000 unique visitors from 143 countries. As always, it is amazing to see such numbers.  

Lately, the pace of pageviews has sharply increased.  That is most likely due to the 30-part series on Truth About Nuclear Power, TANP beginning in March and concluding in August.  Cumulatively, the TANP articles have almost 9,000 views to date, with the Summary article (part 30) and US Nuclear Plants are Heavily Subsidized (part 13) sharing the most views with just over 1,200 views each.   Nuclear plants typically are lauded by the industry and supporters as being cheap, safe, long-lasting, and reliable.  TANP articles shows the truth, that none of those claims are accurate.   New technologies under development are also touted by supporters (small reactors, fusion, thorium, and high temperature gas reactors), and these are shown in TANP to be hopelessly uneconomic or unsafe, or both.  see link to Article One of TANP. Links to all 30 articles are provided there. 

As my readers know very well, my views on man-made climate change are that the science does not support an alarmist view.  see link  That is based on a critical examination of the available data.  What is disappointing is that so many skeptics of climate alarmism are also nuclear power supporters.  How nice it would be if they applied the same scrutiny of climate data to the nuclear plant data.  It appears to me that the nuclear power supporters are being led by smooth-talking dis-informers.  An article on this appeared here:  see link

Also, another series is underway, this one on wind energy.  see link  There is much mis-information spread by the anti-wind group.  Truth About Wind Energy will dispel those myths and show why and how wind energy presently is providing valuable energy, and will in a few years be supplying reliable, low-cost, low environmental impact energy via grid-scale storage.  See link for additional SLB articles on wind energy. 

A few articles discussed coal as an energy source, (see link) concluding that coal is being used up much faster than in the past.  The grim consequence of this is that an economic and reliable replacement for forty percent of the world's electricity production must be found, tested, and proven long before the coal runs out.   The best candidates for coal replacement are renewable energy with grid-scale storage.  Candidates in this area include solar thermal, and offshore wind with submersible pumped storage.  Ocean current energy needs no storage, nor does energy from river mouth osmosis.  

A trio of legal-oriented articles from SLB were republished on other blogs, those being Are Climate Skeptics Legally Liable for Criminal Negligence (see link), Climate Science, Free Speech and Legal Liability (see link), and Prosecuting Those Who Force a Scientist to Resign (see link).  

It was also very interesting to rebut the false claims of the US President in his recent commencement speech to UC-Irvine (2014).  The President spoke on the urgency to combat dangerous man-made climate change.  see link   There is no man-made climate change, and therefore there is no urgency to combat it. 

Finally, it is is gratifying that several groups continue to request me to speak to them on various topics.   In the past three years, I have made formal speeches to Southern California Section of AIChE, to the student chapter of AIChE at University of California at Irvine, and the student chapter of AIChE at UCLA (University of California at Los Angeles).    I am very pleased that UCLA students have asked me to present a four-part series of lectures on approaches to the national student design competition.   See link for a list of recent speeches. 

Roger E. Sowell, Esq.
Marina del Rey, California

Saturday, October 18, 2014

Nuclear Until Renewables Can Shoulder The Load - A Bad Idea

Subtitle:  Yet Another Lame Excuse To Prolong Nuclear Plant Lives

An article in Forbes (see link) is rather long-winded but finally gets to the point in the final paragraphs: 

"If we retire (carbon-free) nuclear plants prematurely, there is only one resource that can fill their place today. Gas-fired power plants (i.e. carbon-emitting) – with 40-year legacies – will step in to replace them. And those commitments, once made, cannot be easily undone."

Forbes correctly points out that solar and wind-powered energy technologies are improving rapidly, both technically and economically.  Therefore, Forbes argues, it is worth keeping the uneconomic, money-losing nuclear plants (see link) running for the additional years or even decades that are required to allow the "carbon-free" (their words) technologies to replace the nuclear plants.   To their credit, Forbes includes not only the power generation from wind and solar, but also grid-scale energy storage to allow on-demand, reliable power.  

Apparently, it is abhorrent to build gas-burning power plants, simply because they emit carbon dioxide from their stacks.   However, one must devoutly believe in the carbon-dioxide-emitted-by-man-is-overheating-the-planet nonsense to reach that conclusion.  Never mind that the climate alarmists have been proven wrong at every turn. 

What ridiculous analogies come to mind?  Should horses pulling buggies (and heavy wagons for commerce) have been subsidized, allowed to continue running by government decree, until electric cars became available and economic?  Should pocket pagers (remember those?) have been subsidized and required to be manufactured because flip-phones using cellular technology would someday be replaced by smart phones?  

Plus, what of the outrageous amounts of water for cooling that nuclear plants require?  It is known that a modern, gas-fired combined cycle plant, CCGT, uses one-fourth the cooling water of a nuclear plant.  Should those in water-scarce areas suffer for years, or decades, while the nuclear plant evaporates the fresh water?  Note, this is not a hypothetical:  the South Texas Nuclear Project (STNP) near Corpus Christi, Texas, does exactly that.  Texas has suffered through a prolonged and serious drought, with the primary storage reservoir, Lake Travis, sending water down the Colorado River to the plant while consumers along the river must not touch the water.   see link.   STNP has a small artificial pond to augment the river water, but that pond depends on seasonal rainfall.  Lately, the rain has not happened.  

Other nuclear plants in the arid areas have the same issue:  the cooling water is evaporated into the sky, where it could be used for human consumption.  

Forbes cites a nuclear industry group, apparently newly-formed, that is desperately trying to pitch nuclear plants as "good" because they are "carbon-free."  The group is Nuclear Matters.  This newest, lamest excuse can be added to the other excuses the industry makes for not shutting down the money-losing nuclear plants, one of which is "nuclear plants create jobs," still another is "nuclear plant closures will have a serious negative effect on the economy."  

The bottom line is this, as shown in a recent SLB article on the proposed and newly-approved UK nuclear plant at Hinkley Point, (see link), renewable energy plus grid-scale storage must beat US$ 12,000 per kW installed to beat the economics of a new, grid-scale nuclear power plant.  With large offshore wind turbines coupled to submerged spherical pumped-storage hydroelectric systems, the $12,000 critical threshold should be fairly easy to achieve or better.   Even more, the nuclear plants cannot follow the grid load, and if they did, their economics are much worse.  Meanwhile, the submerged pumped storage systems can easily follow the grid load.   

In conclusion, there is no need to keep the money-losing nuclear plants running.  The US should take full and immediate advantage of the strong offshore wind resources and work out the inevitable kinks in the submerged pumped storage systems. 

Roger E. Sowell, Esq. 
Marina del Rey, California

copyright (c) 2014 by Roger Sowell -- all rights reserved

Sunday, October 12, 2014

UK Hinkley Point Nuclear Plant Heavily Subsidized

Subsidies for nuclear power plants are not just in the US.   This week, several sources report that UK's proposed Hinkley Point C plant, a 3,200 MWe nuclear plant, received a blessing from the EU Commission to obtain public funding - a form of subsidy.  See link for a BBC report.   (for more on US subsidies for its nuclear power plants, of which there are at least six different subsidies, see this link and this link). 

The Hinkley Point C plant will have two reactors, each 1,600 MWe, of the EPR reactor design that is currently such a fiasco in Finland at Olkiluoto. (see link)   To their credit, the BBC article admits the Hinkley Point C will require 10 years to first operation.  However, the plant life is also stated as 60 years, which is wildly optimistic. 

The subsidy for Hinkley Point C apparently takes the form of a high sales price for power at the transaction bar - the plant boundary.  The plant owner is guaranteed the equivalent of US 15 cents per kWh, approximately double the present rate for wholesale power in the UK.  

What is interesting is the quoted price to build the plant, at £24.5 billion (the equivalent of US$ 39.2 billion).   This equates to MORE than $10,000 per kW, at $12,250.   Again, this is precisely what SLB has maintained all along - a new nuclear power plant costs far more than the $4,000 some advocates maintain.  Instead, it will cost at least $10,000 per kW, and more likely $12,000 per kW.   Here we see at least a small beginning of honesty from the nuclear establishment.  

However, given the long, dismal history of nuclear plant schedule delays and cost overruns, it is to be expected that the Hinkley Point C twin reactor plant will take far longer than 10 years to startup, and will cost far more than US$ 39 billion.  It will likely require 15 years or longer, and $48 billion or even more.  

The poor people of the UK will foot the bill, as they have few choices but to buy the power.  However, with the higher and higher prices that will inevitably occur, it may be possible for some of the grid customers to unplug themselves from the grid.  There may be better, cheaper ways to produce their own electricity.  For an analysis of such ways, see this link.   In the year 2023 or perhaps later, 2030 as a more realistic startup date, the options for unplugging from the grid and self-generation will likely be more numerous and more appealing than what we have today.  

It will be a long, long time before Hinkley Point C begins producing power and its true impact will be felt.  One can only hope the resourceful people of the UK will rise to the occasion and replace as much power as possible to self-generate and save money.  

In another moment of rare candor, UK officials tried to justify the new nuclear plant by stating that there are few options available for providing reliable power.  They state that coal is nearly exhausted and would be unreliable if imported, natural gas also is in short supply and in danger of being cut off by selling nations (meaning Russia), and wind is too unreliable.  Solar in the UK area is not at all economically attractive, owing to the high latitude and cloudy weather.  (The UK, after all, is of the same approximate latitude as Hudson Bay in Canada)   

What, then, is left but nuclear?    One answer, of course, is offshore wind coupled to ocean-based storage systems that supply power on demand, quite reliably. (see link) By 2030, one expects that the offshore wind with storage to be well-proven and very attractive.    All the offshore wind projects must do to compete is beat US$12,250 per kW.  The energy is free, and many of the other very high costs of running a nuclear plant simply do not exist for wind-energy. 

Update - 10/13/2014:  UK wind resources offshore are quite good.  see link   -- end update. 

Roger E. Sowell, Esq. 
Marina del Rey, California

copyright (c) 2014 by Roger Sowell -- all rights reserved

Sunday, October 5, 2014

The Grand Game - Oil in Disarray

Subtitle: Precision Directional Drilling Causes Oil Price Decrease

It has been a while (four years) since I last wrote on the Grand Game, where renewable energy, nuclear power, oil, coal, and natural gas all compete for shares of the world's energy needs.  Previous articles on the Grand Game may be found here (see link).   This week has seen a flurry of articles on the weakness of OPEC, and the looming oil price collapse.   (see link for one of many such articles)

The reasons for the impending oil price reduction, or collapse as it may turn out, are fundamental economics of supply and demand.  Demand is stable or slightly falling, while world supply is increasing as US domestic oil production due to precision directional drilling and hydraulic fracturing brings more oil to the surface.   On a side note: hydraulic fracturing, or "fracking" as the media terms it, is not the key.  It does little good to fracture an oil-bearing formation if the oil well is vertical and pierces only a small part of the oil-bearing rock.  The key to the recent increased oil production is precision directional drilling, in which the oil well travels horizontally through the oil-bearing rock.   

Meanwhile, new cars are achieving ever-increasing miles-per-gallon ratings.  In the commercial aviation field, more and more ultra-efficient aircraft are flying, including Airbus' A380 and the Boeing 787.   However, the biggest influence is the increased oil production in the US.  

World oil price hit a low point this week, with the benchmark crude reaching $90 per barrel, representing approximately 10 percent decrease from recent prices.   It will be very interesting to see if OPEC members can reach some agreement on reduced production levels in an effort to increase or maintain price.  Or, perhaps the member countries will splinter and engage in a production war, each trying to sell as much as possible while prices plummet. 

On an editorial note, the price of oil has many ramifications.   The primary impact is on the cost of delivered goods since most goods move to their destination by petroleum-powered transport.  The transport usually takes the form of diesel-powered trucks and trains.  Also, ships and barges burn fuel oil.   Consumers who drive cars also enjoy reduced prices at the gasoline pump, leaving more disposable income in their wallets.   Industries do not burn much oil in modern times, and very little electricity is produced from oil so there is not much benefit for them.   

One of the major benefits is the price of natural gas, which in some instances is tied to the price of oil.  For example, Russia recently contracted to supply China with great quantities of natural gas, with the price of the gas being tied to the price of oil.    Since natural gas is used for electric power production, lower oil prices will have some impact on electricity prices. 

Long-term, OPEC has warned that low oil prices will create an oil shortage.  OPEC insists that few, if any, investments will be made into new production unless the price is obtainable to justify the spending.  

OPEC will meet again in November, 2014.   The results of that meeting should be interesting. 

Roger E. Sowell, Esq. 
Marina del Rey, California

copyright (c) 2014 by Roger Sowell -- all rights reserved

Monday, September 29, 2014

Russia and Energy Stranglehold on Europe

Subtitle: Still Dumb to Drill Baby Drill in US

An article by Paul Driessen, senior policy analyst at CFACT, appears at  (see link), in which he makes several points directed at how EU nations and the US should change energy policies to reduce the Russians' grip over those EU countries.   

(side note:  I met Paul Driessen briefly at the Ninth International Conference on Climate Change, July 7-9, 2014, in Las Vegas, Nevada.  I cannot say I know the man well; it was just a very brief hello and exchange of cards.)

Some of what Mr. Driessen wrote in his Stranglehold article makes sense, and I agree with those points.   Other points are wrong, in my view.  

He is correct that Russia sells a great deal of natural gas to EU nations, and that Russia sometimes cuts off the gas flow.   He is also correct that EU nations could, and probably should, take steps to reduce reliance on Russian gas.  

His recommended steps are to import more gas from the US and other countries, and produce gas in their own countries.   What Mr. Driessen does not mention is that the US economy is enjoying a boom in engineering, process plant construction, and production of materials produced in those plants.  The economy, as bad as it is, would be much, much worse without the present supplies and low prices of feedstocks for those process plants - feedstocks that derive from production of natural gas.   Exporting natural gas to EU countries or elsewhere would increase the price of our domestic gas, and the light hydrocarbons that feed those chemical processing plants.    Therefore, it is not in the US' best interest to export natural gas to EU. 

I agree that other countries could, and should, produce their own reserves of natural gas.  The key process is precision directional drilling, not just hydraulic fracturing.   (see link for my article on France, natural gas, and the French nuclear industry). 

Next, Mr. Driessen argues that the US should increase drilling and production of oil from Federal lands.  This is an error, as I have written on and made speeches about (see link).  In my 2011 speech at Tulane Law School, New Orleans, Louisiana, I made the point that the US must conserve its oil resources against a future when other countries once again stop their oil exports to us, and we are in a prolonged and possibly world war.  All US presidents know that one of the reasons the Allies won World War II was the oil from the US.   This is indisputable, and is described in great detail in the Pulitzer Prize-winning book The Prize by Daniel Yergin.    As I said in my speech at Tulane, 

". . . we must take the long view and not be short-sighted. It is critical that the US be prepared for that day when we will desperately need our domestic oil. That day when our foreign supplies are cut off yet again, and this time we are in a prolonged world war, similar to World War II. To meet that day, we must have oil in our own lands. Every president since Truman has known this to be true, and therefore have made so much of the USA offshore off-limits to drilling. The West Coast, East Coast, and eastern Gulf of Mexico are off-limits to drilling. Much of the on-shore lands are also off-limits, including the ANWR. We know the oil is there. We don’t need that oil right now. Preserving that oil for the future is critical, and that is why Drill, Baby, Drill is Dumb, Baby, Dumb."

Finally, Mr. Driessen opines that "the world is not going find safe, efficient, affordable, environment-friendly alternatives to oil, natural gas and coal in the next decade or so."   Yet, the renewable energy industries have already delivered wind and solar power that is producing valuable electric power.  The renewable energy field has ongoing reductions in production costs, as more efficient machines are made in both wind and solar arenas, better wind resources are tapped, economy of scale is applied, and grid-scale storage systems are deployed.   High prices for natural gas make the economics of renewable systems even better, therefore EU nations can look more and more to renewables.   The future will include not only wind and solar, but ocean currents will provide vast amounts of inexhaustible power with no need for storage.  

Roger E. Sowell, Esq. 
Marina del Rey, California

copyright (c) 2014 by Roger Sowell -- all rights reserved

Sunday, September 14, 2014

California Peaking in Power Demand in 2014

Subtitle:  Grid Is Peaking a Bit Late This Year

Watching the California grid operator, CAISO (California Independent System Operator) is part of keeping tabs on climate change.  After all, if the warmist-alarmists are correct, the climate is getting warmer due to increasing Carbon Dioxide (CO2) emissions.  The warmists are completely wrong, of course.  

This post is timely since there has been a fairly cool summer thus far in California, with the grid not being pushed much.  Today, however, the temperatures reached 106 F at 2:00 pm in downtown Los Angeles as measured at the campus of University of Southern California.  Weather forecasts are for more of the same for the next two days.  The normal temperature for this part of September is 83-84 F, with record temperatures 100 to 103 F set in 2012 and 1909.   The cause of the high temperatures is merely a stationary high pressure system.  Additional CO2 in the earth's atmosphere has nothing to do with it.  

The power grid peaked today at 41,540 MW per the CAISO website.  Their forecast for tomorrow is about 10 percent higher at 44,842 MW.   The weekend is almost always lower in demand than a weekday.  

For perspective, below are the peak demands for the past few years, again from CAISO:  (format from left to right in Year, MW demand, Month and Day, time of peak in hours and minutes; 16:00 is 4:00 pm)

1998 44,659 August 12 14:30
1999 45,884 July 12 16:52
2000 43,784 August 16 15:17
2001 41,419 August 7 16:17
2002 42,441 July 10 15:01
2003 42,689 July 17 15:22
2004 45,597 September 8 16:00
2005 45,431 July 20 15:22
2006 50,270 July 24 14:44
2007 48,615 August 31 15:27
2008 46,897 June 20 16:21
2009 46,042 September 3 16:17
2010 47,350 August 25 16:20
2011 45,545 September 7 16:30
2012 46,846 August 13 15:53
2013 45,097 June 28 16:54
2014 45,090 September 15 17:00  (estimated, to be confirmed)

The latest such peak day was September 8, in 2004.  If tomorrow (Monday) or Tuesday are the peak days, this will be the latest such peak for the past 17 years.  

The grid may be pushed a bit, since the San Onofre nuclear power plants are permanently offline since 2012 due to the radiation release caused by defective steam generators, but also from the lack of hydroelectric power during the ongoing drought.    The renewable generation in California includes solar, wind, geothermal, biomass, and biogas.  Solar and wind are variable while the other three are very stable.   In the current heat wave, very little wind is blowing; the average for today (Sunday September 14) was approximately 1000 MW.   

The power to the grid, therefore, must either be provided by natural gas-fired power plants, the one remaining nuclear plant at Diablo Canyon, or imported if possible.  The state may also request load reductions from major users to ease the load.  

CAISO information on grid demand and supplies, including renewables, can be found at this link.

Update: 9/15/14, CAISO demand peaked at 45,090 MW today at approximately 17:00 hours.   This is the highest of the year, thus far.  Approximately 7,000 MW of this was provided by renewable energy: 4500 solar, 1000 wind, 900 geothermal, and the balance from small hydro, bio-mass and bio-gas.   - end update. 

Update:  9/17/14, the grid peak demand was lower today, at 43,757 MW at around 16:00 hours.  This reduced demand coincided with an increase in wind across the state, and wind-generated power.  The wind brings with it a cooling effect, reducing air conditioning loads.  The wind also produced approximately 2,800 MW of power.  Yet another benefit of wind-energy: cooling the atmosphere and thus reducing the load on the grid as it did today.  All the gas-fired plants were able to ease up a bit.   

The heat wave has ended, and cooler weather with lower grid demands will exist until sometime next summer.  -- end update

Roger E. Sowell, Esq. 
Marina del Rey, California

Copyright (C) 2014 by Roger Sowell - all rights reserved