For decades Wall Street financial engineers, teaming up with electric power producers, have gamed wholesale electricity auctions to earn bigger profits than either a regulated utility or a competitive market would yield. This month they made a major advance in their campaign to get rich by subtly draining your wallet. Yet every major news organization ignored this.
This latest development took place in New England, which already has America’s most expensive electricity. February’s electricity auction saw the annual cost to customers rise to $4 billion, up from about $3 billion in last year’s auction and less than $2 billion in the 2013 auction. That $4 billion figure would have been much higher but for a rule capping prices.
By the way, that $4 billion is not for the electricity, which costs extra. The $4 billion price tag is for capacity payments made to owners just for promising to run their power plants in 2018 and ’19.
If that sounds bizarre, it’s because it is. It is comparable to government taxing us to pay auto dealers to keep enough cars and trucks on their lots to satisfy expected future demand.
Half the states also have auctions that set the price of electricity for periods ranging from a year down to a few minutes. The other half still rely on traditional rate regulation, which has its own problems.
If there is abundant capacity to produce power at peak periods, such as hot summer afternoons, then prices will not rise much, if at all. But if there is barely enough power to meet demand, then prices rise significantly. And if capacity is just 1 percent less than demand, the wholesale price soars.
In these auctions every producer gets the top price even if most bid far less. These are known as clearing price auctions, in which the highest bidder sets the price for all suppliers…
Robert McCullough, an Oregon utility economist known for busting industry myths, says gaming of electricity markets is easy and lucrative, as long as regulators look the other way.
“With perfect competition, you always bid your marginal cost — as the economist Alfred Marshall was pointing more than a hundred years ago,” McCullough said. “However, when your market share is sufficiently high that you have the potential to set the market price, it is in your interest to raise your price above marginal cost, even though you will lose some of your market share” because one or more of your fleet of power plants will produce no electricity and thus not collect any money.
“This gets even better when you can buy someone else’s plant and shut it down,” McCullough added, because the reduced capacity means higher prices. Combined with the savings from not operating the shuttered plant, the result is much bigger profits.
Yes, these are the same schmucks who bankroll Republican agitprop about how free market capitalism guarantees our freedom. They leave out the part about buying politicians, buying off regulators with better-paying jobs as a reward when they’re through pimping the biz.
Then you get to double dippers like North Carolina’s governor Pat McCrory. He had a whole career working for Duke Energy. Left to become the gpvernor and, no doubt, will return to being officially on the payroll, once again, after he’s through directing that state’s legislative mediocrity into further kissing corporate butt.
LucidPipe installation — a turbine visible inside the pipe
There’s a lot of water constantly moving through the municipal pipelines of most major cities. While the water itself is already destined for various uses, why not harness its flow to produce hydroelectric power? Well, that’s exactly what Lucid Energy’s LucidPipe Power System does, and Portland, Oregon has just become the latest city to adopt it.
LucidPipe simply replaces a stretch of existing gravity-fed conventional pipeline, that’s used for transporting potable water. As the water flows through, it spins four 42-inch (107-cm) turbines, each one of which is hooked up to a generator on the outside of the pipe. The presence of the turbines reportedly doesn’t slow the water’s flow rate significantly, so there’s virtually no impact on pipeline efficiency.
The 200-kW Portland system was privately financed by Harbourton Alternative Energy, and its installation was completed late last December. It’s now undergoing reliability and efficiency testing, which includes checking that its sensors and smart control system are working properly. It’s scheduled to begin full capacity power generation by March.
Once up and running, it’s expected to generate an average of 1,100 megawatt hours of energy per year, which is enough to power approximately 150 homes. Over the next 20 years, it should also generate about US$2 million in energy sales to Portland General Electric, which Harbourton plans on sharing with the City of Portland and the Portland Water Bureau in order to offset operational costs. At the end of that period, the Portland Water Bureau will have the right to purchase the system outright, along with all the energy it produces.
Something cities like Albuquerque and Santa Fe, New Mexico, should consider. The rush of population growth and concurrent water system expansion took place right after World War 2. The mediocre piping installed now fails on a regular basis. Cripes, in Abq it’s weekly, even daily.
Of course, rebuilding infrastructure – especially with an eye on future requirements and additions – ain’t exactly part of being an American politician, nowadays.
Apple’s new Campus 2 – under construction in Cupertino, California
Apple’s landmark solar power deal…is a long-term sustainable energy solution that should generate enough to power essentially all of the company’s California operations, including the upcoming “spaceship” Campus 2, by the end of 2016.
The green energy will be purchased from First Solar, Inc., through an $848 million agreement that will last for at least 25 years, making it the largest of its kind in the industry. First Solar will be providing electricity through its forthcoming 2,900-acre California Flats Solar Project in Monterey County…
In total, the solar plant will output 280 megawatts of electricity, 130 megawatts of which will be bought by Apple. The remaining 150-megawatt capacity will be sold to Pacific Gas & Electric under a separate long-term power purchase agreement…
Cook said…that Apple will buy enough electricity to power nearly 60,000 California homes. That’s enough to offset the electricity used by Apple’s upcoming Campus 2, as well as all 52 Apple retail stores in the Golden State, and its data center in Newark.
The Apple CEO also made it clear that climate change is a very serious issue for him and his company, which is why they are taking the lead on renewable and sustainable energy. Cook also noted to investors that the agreement makes sound financial sense as well, as the $848 million deal will result in “very significant savings” on the cost of energy.
So, the most valuable corporation in the world says it makes economic sense to move eletricity generation away from fossil fuel, away from coal and oil.
Congressional pimps and cowards, Republican conservatives and Blue Dog Democrats, bleat this isn’t possible.
Which side are you on?
The harvesting of wood to meet the heating and cooking demands for billions of people worldwide has less of an impact on global forest loss and carbon dioxide emissions than previously believed, according to a new Yale-led study.
Writing in the journal Nature Climate Change, a team of researchers, including Prof. Robert Bailis of the Yale School of Forestry & Environmental Studies, concludes that only about 27 to 34 percent of wood fuel harvested worldwide would be considered “unsustainable.” According to the assessment, “sustainability” is based on whether or not annual harvesting exceeds incremental re-growth…
According to the authors, the findings point to the need for more nuanced, local-specific policies that address forest loss, climate change, and public health. They also suggest that existing carbon offset methodologies used to reduce carbon emissions likely overstate the CO2 emission reductions that can be achieved through the promotion of more efficient cookstove technologies.
The study identifies a set of “hotspots” where the majority of wood extraction exceeds sustainable yields. These hotspot regions — located mainly in South Asia and East Africa — support about 275 million people who are reliant on wood fuel.
However, in other regions, the authors say, much of the wood used for this traditional heating and cooking is actually the byproduct of deforestation driven by other factors, such as demand for agricultural land, which would have occurred anyway…
The results stand in contrast to a long-held assumption that the harvesting of wood fuels — which accounts for more than half of the wood harvested worldwide — is a major driver of deforestation and climate change…
Emissions from wood fuels account for about 1.9 to 2.3 percent of global emissions, the study says. The deployment of 100 million improved cookstoves could reduce this by 11 to 17 percent, said Bailis, who also studies the factors that influence the adoption of cleaner cookstoves in developing nations…
“We need to be able to understand where these different components of non-renewability are coming from in order to get a better sense of the positive impacts of putting stoves into peoples’ homes or promoting transitions to cooking with gas or electricity,” he said.
Economics rules. IMHO The first reason to choose wood-burning for fuel is cost. There is none. Yes, there is the cost of labor-time; but, the discussion covers a majority of rural families who are self-sustaining farmers…with little or no cash income.
Cost factors of electricity, natural gas, butagaz, etc. aren’t part of the equation. These folks generally can’t budget to buy fuel. Income-generation from local/regional small-scale manufacturing or more efficient, more productive methods of agriculture offering surplus to sell can remedy that core problem.
Ellen Merkel says she gets “a little teary-eyed” when she thinks about the Vermont Yankee nuclear plant sending its last electrons to the regional power grid. She knows it will likely mean moving from her nice neighborhood in Vernon, where her husband works at the plant, to the South for a new job.
Frances Crowe, of Northampton, Massachusetts, says she’ll take some satisfaction that her anti-nuclear activism, which began before Vermont Yankee was built in the late 1960s, has had an impact. But she promised to continue to push for the highly radioactive spent fuel from the plant to be moved as soon as possible.
Those were among the reactions in the three-state region of Vermont, New Hampshire and Massachusetts as the plant finishes powering down and prepares to disconnect from the grid, most likely Monday…
Vermont Yankee, the state’s only nuclear reactor, employed more than 600 people when it announced it would close. The workforce will be cut in half after a round of layoffs and retirements Jan. 19. In 2016, the plant will see another big reduction as it prepares for a 30-year period during which time its radiation will cool. The plant likely won’t be dismantled until the 2040s or later. [My emphasis added – Eid]
David Noland always knew electric cars were cheap to run, but this is ridiculous. [OK – Back to first-person]
After I bought the first set of replacement tires for my 2013 Tesla Model S (at 26,000 miles), I crunched the numbers and came to a startling conclusion: I’ve spent substantially less per mile for my electric “fuel” than I have for my tires.
The tires weren’t cheap. The Michelin Primacy MXM4 all-season grand-touring tires set me back $250 apiece, plus mounting and balancing, for a total of $1,131.
Over 26,277 miles, that works out to 4.3 cents per mile. Pretty typical for a high-performance luxury sedan.
Over those same 26,277 miles, I used a total of 8,531 kilowatt-hours of electricity.
But, thanks to Tesla’s network of free high-power Superchargers, I didn’t pay for all of it.
As best as I can figure, I drove about 5,500 Supercharged miles during that time, including a 2,500-mile round-trip to Florida from my home in New York’s Hudson Valley.
That means I probably sucked up around 1,800 free kWh from the Superchargers.
So let’s say I paid for 6,700 kWh…My local utility, Central Hudson, charges about 14 cents per kWh. (Unfortunately, it offers no special night-time or electric car rates.)
So, let’s do the math: 6,700 kWh x 14 cents/kWh = $938…Divide by 26,277, and my total “fuel” cost per mile works out to a remarkable 3.6 cents per mile.
That’s 20 percent less than the per-mile cost of the tires that carried me on all those miles.
Yes, you can spend more – or less – on electricity or tires. Or tyres [I spent more years selling tyres than tires – few countries use American spelling for English].
RTFA for the fun and satisfaction of driving a car absent fossil fuel and the direct pollution that results. Tesla also takes advantage of the rate of torque transmitted directly to the road by a DC motor. It is a feeling that demands gobs of horsepower from anything that requires fire inside.
Looking rather like a 10-meter tall sunflower, IBM’s High Concentration PhotoVoltaic Thermal (HCPVT) system concentrates the sun’s radiation over 2,000 times on a single point and then transforms 80 percent of that into usable energy. Using a number of liquid-cooled microchannel receivers, each equipped with an array of multi-junction photovoltaic chips, each HCPVT can produce enough power, water, and cooling to supply several homes.
Swiss-based supplier of solar power technology, Airlight Energy, has partnered with IBM Research to utilize IBM’s direct warm-water cooling design (adapted from use in IBM’s SuperMUC supercomputer), water adsorption technologies, and leverage IBM’s past work with multi-chip solar receivers developed in a collaboration between IBM and the Egypt Nanotechnology Research Center, to develop and produce the system…
“The direct cooling technology with very small pumping power used to cool the photovoltaic chips with water is inspired by the hierarchical branched blood supply system of the human body,” said Dr. Bruno Michel, manager, advanced thermal packaging at IBM Research.
The HCPVT system can also be adapted to use the cooling system to provide drinkable water and air conditioning from the hot water output produced. Salt water is passed through the heating conduits before being run through a permeable membrane distillation system, where it is then evaporated and desalinated. To produce cool air for the home, the waste heat can be run through an adsorption chiller, which is an evaporator/condenser heat exchanger that uses water, rather than other chemicals, as the refrigerant medium.
The creators claim that this system adaptation could provide up to 40 liters (10 gallons) of drinkable water per square meter of receiver area per day, with a large, multi-dish installation theoretically able to provide enough water for an entire small town.
All of these factors, – waste energy used for distillation and air-conditioning combined with a 25 percent yield on solar power – along with the setup’s sun tracking system that continuously positions the dish at the best angle throughout the day, combine to produce the claimed 80 percent energy efficiency…
Estimations on the operating lifetime for the HCPVT system are around 60 years with adequate maintenance, including replacing the shielding foil and the elliptic mirrors every 10 to 15 years (contingent on environmental conditions) and the PV cells, which will require replacement at the end of their operational life of approximately 25 years…
Everyone is so cautious about operational life of photovoltaic systems. It cracks me up. There are homes here in New Mexico with 20 to 30-year-old PV solar panels still running at 90-95% efficiency.
OTOH, the photo-tracker design is one long-accepted by those who can afford the original cost. The National Guard Armory just outside Santa Fe is a site with such an installation.
I look forward to checking out costs and payback when the critters are in production.
Xinjiang Uygur Autonomous Region, a major power supplier in China, has accelerated the development of green energy as it recorded higher installed capacity in 2013.
Statistics with the Xinjiang branch of the State Grid Corporation of China (SGCC) showed that by 2013, the combined installed capacity of wind power, hydropower and solar power stations exceeded 1,368 million KW, accounting for about one third of all installed capacity in Xinjiang….
A project to connect the Xinjiang power grid to the northwest China grid was launched in 2010 to transmit Xinjiang’s redundant electric power to other parts of the country. The money made from this is used for developing Xinjiang.
The SGCC Xinjiang branch has put an average annual investment of 500 million yuan towards green energy projects.
Total installed capacity is expected to reach 6,048 million KW by the end of 2014, and that of green power will exceed 2,200 million KW.
While this wee post may seem a bit foreign to many of my readers you have to understand I live in a part of the United States with many parallels to Xinjiang.
Aside from some historic political differences, the natural landscape is often similar. As is the potential. It’s been 20 or 30 years since the New Mexico state engineer’s office determined we had sufficient resources to be a net exporter of wind-generated electricity. We are equally capable of filling state needs and then exporting solar-generated electricity.
The technology for each of these alternatives has improved and become more cost effective over the decades – while the state, local power utilities and the federal government have accomplished little more than a sampling of what might be if they were as serious about non-polluting power generation as they all are about the crap coal mined and burned in the Four Corners.
- this is what you get.
China will replace four coal-burning heating plants in the capital Beijing with natural gas fired ones by the end of next year as it steps up efforts to clean up pollution…
The report, citing the city’s Municipal Commission of Development and Reform, said the four plants and some 40 other related projects would cost around $8 billion and cut sulphur dioxide emissions by 10,000 metric tons. It did not detail the related projects.
The plan is the latest step by authorities to deal with a persistent smog crisis in China’s big cities that is fuelling public anger. The capital has been shrouded in thick hazardous smog for several days during the ongoing seven-day national holiday.
China has been under pressure to tackle air pollution to douse potential unrest as an increasingly affluent urban populace turns against a growth-at-all-costs economic model that has besmirched much of China’s air, water and soil.
Last month the government announced plans to slash coal consumption and close polluting mills, factories and smelters, though experts said implementing the targets would be a major challenge.
The new plants will replace four coal-fired ones that provide heating for homes in the city’s central urban area as well as generating electricity, Xinhua said.
Beijing is the Auld Reekie of the 21st Century. For those of you who don’t know the term, it described Edinburgh [and London] not only in the years before World War 2, but, especially afterwards during the efforts to ramp industrial production back up to speed in the UK.
Then, as now, though industrial use was a significant portion of the air pollution, everyone’s attachment to their wee coal fire heating the main rooms of home was a tough cultural obstacle – just as central to established urban life in Beijing. The solution has to be the same – replacing those coal fires with natural gas or electricity generated by means other than burning coal.
The cost of bringing large volumes of natural gas to locations in and around Beijing also lays the groundwork for local provision and access to that cleaner substitute for coal. Smart idea.