The Energy Thread

[Pelado]

Interesting (long) article mainly about the history of petroleum-based energy and the various potential disruptions (economic, political, climatologic) that could be caused by methane hydrate:

http://www.theatlantic.com/magazine/...of-oil/309294/

Estimates of the global supply of methane hydrate range from the equivalent of 100 times more than America’s current annual energy consumption to 3 million times more. A tiny fraction—1 percent or less—is buried in permafrost around the Arctic Circle, mostly in Alaska, Canada, and Siberia. The rest is beneath the waves, a reservoir so huge that some scientists believe sudden releases of undersea methane eons ago set off abrupt, catastrophic changes in climate. Humankind cannot tap into the bulk of these deep, vast deposits by any known means. But even a small proportion of a very big number is a very big number.

[Katy Lied]

Here's a legal dispute: Is the sale of electricity a good or a service according to the US Bankruptcy Court? There are currently conflicting decisions now appearing in US District and Bankruptcy Courts, with sizeable implications on either side.

http://www.energycentral.com/utilitybusiness/policyregulatoryandlegal/articles/2822?goback=%2Egde_4474923_member_5833598657806479361#%21

Hope the link works as it is a members link.

III. CONCLUSION
Contrary to NE OPCO, the analysis of whether the sale of electricity is a goods under Section 503(b (9) of the Bankruptcy Code and U.C.C. Section 2-105 should be a straight forward one, as suggested by the many cases cited above, and in particular Grede Foundaries,Erving Industries, and Pacific Gas & Electric. None requires an analysis of the physics of electricity. Like the other many cases herein, the analysis is simple: once electricity moves through the meter, it is capable of being identified and measured, with precision.
Courts have held electric utilities liable as the seller of goods, not services, under a variety of circumstances. Imposing warranties available once an item either is a goods, as provided under the U.C.C., or a product, as provided under strict liability tort statutes, courts have found that once electricity enters the stream of commerce (after passing the metering point at the customer’s premises), then it constitutes either a goods (under the U.C.C.) or a product (under the strict liability tort statute). Either way, electric utilities find themselves liable for potential damages as a result of such classifications. With the enactment of Section 503(b)(9), it would be extremely incongruous to rule that while for purposes of negligence or contractactions, electricity is a goods or a product, and not a service; however, for purposes of the Bankruptcy Code, electricity is a service and not a goods.
Be aware of one major caveat: Prior to filing a Section 503(b )(9) claim for electricity, one should consult with management and counsel to evaluate whether doing so might increase inordinately a municipal utility’s exposure to negligence or product liability claims.

[Pelado]

Here's a legal dispute: Is the sale of electricity a good or a service according to the US Bankruptcy Court? There are currently conflicting decisions now appearing in US District and Bankruptcy Courts, with sizeable implications on either side.

http://www.energycentral.com/utilitybusiness/policyregulatoryandlegal/articles/2822?goback=%2Egde_4474923_member_5833598657806479361#%21

Hope the link works as it is a members link.

Is it appropriate terminology to refer to it as "a goods?" I would have thought the singular would be "a good."

[creekster]

Is it appropriate terminology to refer to it as "a goods?" I would have thought the singular would be "a good."

Well it ain't a bad, that's for sure.

[clackamascoug]

I once got served by electricity, and it was not good.

[Pelado]

Well it ain't a bad, that's for sure.

When the context is bankruptcy or tort liabilities, I'm not so sure it ain't a bad.

[Omaha 680]

I once got served by electricity, and it was not good.

Since moving to NYC, a lot of my site visits are on electrified railways (both catenary and third rail). The safety training for those visits involves horror stories and sometimes photo/video of what happens if you come into contact with the wire or rail. Last week they showed us video of some dude in India who was on top of a train and grabbed the catenary wire. Yeah, not pretty.

[Moliere]

I wonder if we export coal to Asia? I've heard China and India have an isatiable appetite for it.

It would be great if we could streamline LNG exports somehow. It's a huge capital investment on the front end, and the regulatory risk is high, so even blue chip companies are wary of US LNG projects.

I don't know about coal to China, but I'm sure there are stats and graphs on it somewhere. Australia is a big coal producer and I imagine they supply more, but we probably ship a lot as well.

On LNG, it's kind of a catch 22 for the government. There is a ton of money to be made in exporting LNG form the US. We have ample supply and prices are relatively low. The government is already approving export requests, however they are being deliberatly slow in doing this. I believe Cheniere was the first to get approval and they are trying to get in a position to do just that. THere are many LNG import facilities that were built a decade ago that are mothballed and companies would like to retrofit them to export, however the fact they got burned on building the facilities in the first place makes them weary to invest the capital to convert them to exporters. Given that the gas industry basically flipped overnight (relatively speaking) who's to say it won't flip again?

The government could help out by guaranteeing some of the capital cost or making it easier through tax incentives, but then what happens when we start exporting and the price of gas goes up? Politicians would then be in a position where they pushed for exportation, thus causing increasing prices. It's part of hte reason that crude is currently not exportable as the uproar from the population would be huge.

Most companies are making their money on LNG by shipping from Africa or Australia to the Far East or even Europe. They are buying gas on Henry Hub index ($4/mmbtu) and selling it at 14-15% of Brent ($15/mmbtu) and making hand over fist.....for now. America is currently missing out on this cash flow, but we are also enjoying very low and very predictable gas prices.

[Uncle Ted]

Yet another case of "tax it if moves" (even it is in the right direction)...

The world's dumbest idea: Taxing solar energy

In a setback for the renewable energy movement, the state House in Oklahoma this week passed a bill that would levy a new fee on those who generate their own energy through solar equipment or wind turbines on their property. The measure, which sailed to passage on a near unanimous vote after no debate, is likely to be signed into law by Republican Gov. Mary Fallin.


The bill, known as S.B. 1456, will specifically target those who install power generation systems on their property and sell the excess energy back to the grid. However, those who already have such renewable systems installed will not be affected.


Still, it’s the new customers who will rapidly make up the majority, even in a traditional oil-and-gas powerhouse like Oklahoma. That’s because the cost of solar power systems has been drastically falling for the last five years. Solar installations nationwide are going to shoot up to an estimated 45 gigawatts in 2014, a new record, and are projected to grow even more in coming years as solar prices fall further and fossil fuel extraction gets harder and more expensive.


Now, utility firms in Oklahoma say they just want to be compensated for use of their infrastructure. But renewable energy fed back into the grid is ultimately doing utility companies a service. Solar generates in the daytime, when demand for electricity is highest, thereby alleviating pressure during peak demand.

Oklahoma is not alone. Last year, Arizona enacted a similar law. Legislators in Spain tried to do the same thing. The pushback against renewable energy, it seems, is already here.
[…]

http://news.yahoo.com/worlds-dumbest-idea-taxing-solar-energy-111300623.html

[Uncle Ted]

It's Final -- Corn Ethanol Is Of No Use

OK, can we please stop pretending biofuel made from corn is helping the planet and the environment? With huge subsidies for ethanol in gasoline, with all States now selling gasoline having some ethanol blend, and a general misconception that these biofuels are green, corn ethanol has taken on a $30 billion/yr life of its own.


The United Nations Intergovernmental Panel on Climate Change released two of its Working Group reports at the end of last month (WGI and WGIII), and their short discussion of biofuels has ignited a fierce debate as to whether they’re of any environmental benefit at all.

The IPCC was quite diplomatic in its discussion, saying “Biofuels have direct, fuel‐cycle GHG emissions that are typically 30–90% lower than those for gasoline or diesel fuels. However, since for some biofuels indirect emissions—including from land use change—can lead to greater total emissions than when using petroleum products, policy support needs to be considered on a case by case basis” (IPCC 2014 Chapter 8).


The summary in the new report also states, “Increasing bioenergy crop cultivation poses risks to ecosystems and biodiversity” (WGIII).

The report lists many potential negative risks of development, such as direct conflicts between land for fuels and land for food, other land-use changes, water scarcity, loss of biodiversity and nitrogen pollution through the excessive use of fertilizers (Scientific American).
[…]

http://www.forbes.com/sites/jamescon...news.publishes


Well, I think folks like Evan Williams, Jim Beam, Elijah Craig, and Jack Daniels would disagree...

[Moliere]

Yet another case of "tax it if moves" (even it is in the right direction)...


http://news.yahoo.com/worlds-dumbest...111300623.html

I hear that most of the groups that want this tax on solar are the conservatives. The tax breaks for solar were kind of dumb and now the new tax on solar is also kind of dumb. Best to just let technology run its course and you wouldn't end up with solar companies running amok like they are doing in Oklahoma and San Diego.

[Uncle Ted]

I hear that most of the groups that want this tax on solar are the conservatives. The tax breaks for solar were kind of dumb and now the new tax on solar is also kind of dumb. Best to just let technology run its course and you wouldn't end up with solar companies running amok like they are doing in Oklahoma and San Diego.

Yeah, but if they don't start if they don't figure out a way to tax those electric cars to help pay for the roads I may just joint the club and get me one of those plug-in cars especially with the fed golf cart tax credit. BTW, when are they going to make a plug-in truck?

[Moliere]

http://www.arabtoday.net/gbw-ihjqidkfgikgj/US%20petroleum%20production%20hits%2044%20year%20high.html

Petroleum production, including crude oil and related liquids, known as condensate, and natural gas liquids (NGLs) such as ethane, was 11.27m barrels per day in April, almost equalling the peak of 11.3m b/d reached as an average for 1970. Recent growth rates suggest that it has now exceeded that figure.

The US is already the world’s largest producer of oil and gas, taken together, and is one of the top three in terms of oil alone, alongside Russia and Saudi Arabia.

[Green Monstah]

http://www.arabtoday.net/gbw-ihjqidk...ar%20high.html

Dear America,

You're Welcome.

Sincerely,

The oil and gas producers of 'Murica

[Pheidippides]

Dear America,

You're Welcome.

Sincerely,

The oil and gas producers of 'Murica