Study: Frequency of Atlantic Hurricanes Doubled Over Last Century; Climate Change Fueling Much of the Increase

30 July 2007

A new statistical analysis of hurricanes and tropical storms in the north Atlantic found that about twice as many Atlantic hurricanes form each year on average than a century ago. The study, by Greg Holland of the National Center for Atmospheric Research (NCAR) and Peter Webster of the Georgia Institute of Technology, concludes that warmer sea surface temperatures (SSTs) and altered wind patterns associated with global climate change are fueling much of the increase.

The study, from an upcoming issue of the journal Philosophical Transactions of the Royal Society A on Climate Change and Urban Areas, will be published online this week on the journal's FirstCite.

The analysis identifies three periods since 1900, separated by sharp transitions, during which the average number of hurricanes and tropical storms increased dramatically and then remained elevated and relatively steady.

These numbers are a strong indication that climate change is a major factor in the increasing number of Atlantic hurricanes.

—Greg Holland

The first period, between 1900 and 1930, saw an average of six Atlantic tropical cyclones (or major storms), of which four were hurricanes and two were tropical storms. From 1930 to 1940, the annual average increased to 10, consisting of five hurricanes and five tropical storms. In the final study period, from 1995 to 2005, the average reached 15, of which eight were hurricanes and seven were tropical storms.

This latter period has not yet stabilized, which means that the average hurricane season may be more active in the future. Holland and Webster caution, however, that it is not possible at this time to predict the level at which the frequency and intensity of storms will stabilize.

The increases over the last century correlate closely with SSTs, which have risen by about 1.3 degrees Fahrenheit in the last 100 years. The changes in SSTs took place in the years prior to the sharp increases in storm frequency, with an SST rise of approximately 0.7 degrees Fahrenheit leading up to 1930 and a similar rise leading up to 1995 and continuing even after. The authors note that other studies indicate that most of the rise in Atlantic SSTs can be attributed to global warming.

The unusually active hurricane seasons of 2004 and 2005 have spurred considerable research into the question of whether more intense tropical cyclones are correlated with natural cycles, global warming, or some other cause. The new study indicates that natural cycles are probably not the entire cause because the increase has happened across the last century rather than oscillating in tandem with a natural cycle.

The study also finds that enhanced observations in recent decades cannot account for all of the increase. To observe storms in the Atlantic more systematically, meteorologists began relying on data from aircraft flights in 1944 and satellites about 1970. The distinct transitions in hurricane activity noted by Holland and Webster occurred around both 1930 and 1995.

We are of the strong and considered opinion that data errors alone cannot explain the sharp, high-amplitude transitions between the climatic regimes, each with an increase of around 50 percent in cyclone and hurricane numbers, and their close relationship with SSTs.

—Holland and Webster

While the number of storms has steadily increased, the proportion of hurricanes to all Atlantic tropical cyclones has remained steady. Hurricanes have generally accounted for roughly 55% of all tropical cyclones. However, the proportion of major hurricanes (those with maximum sustained winds of at least 110 miles per hour) to less intense hurricanes and tropical storms has oscillated irregularly, and has increased significantly in recent years.

The 2006 hurricane season was far less active than the two preceding years, in part because of the emergence of an El Niño event in the Pacific Ocean. However, that year, which was not included in the study, would have ranked above average a century ago, with five hurricanes and four other named storms.

Even a quiet year by today's standards would be considered normal or slightly active compared to an average year in the early part of the 20th century.

—Greg Holland

The University Corporation for Atmospheric Research manages the National Center for Atmospheric Research under primary sponsorship by the National Science Foundation.

The first issue of Philosophical Transactions appeared in March 1665 and featured Oldenburg's correspondence with leading European scientists. In its formative years Isaac Newton had seventeen papers published in the journal including his first paper—New Theory about Light and Colours—which effectively served to launch his scientific career in 1672. In the same year his new reflecting telescope was described and the original drawing was also published in the journal. Philosophical Transactions has also published the work of Charles Darwin, Michael Faraday, William Herschel and many more celebrated names in science.

Resources:

• "Heightened Tropical Cyclone Activity in the North Atlantic: Natural Variability or Climate Trend?"; Greg J. Holland and Peter J. Webster; Phil. Trans. R. Soc. A

Economically Viable Alternative Energy?

Despite my staunch belief that we do need to alleviate our dependence on fossil fuels, I cannot help but become irritated with the incessant din streaming from the mouths of farmers, greenies and congressmen alike. You can't escape it, so why don't we all stop trying. From television commercials, to corporate branding and our elected puppets, everyone is deputizing alternative energy and more specifically biofuels as the be all and end all to our energy dilemma.

What many fail to realize however is the sheer immensity of this task. The amount of energy we collectively produce from fossil fuels is astronomical. At this point, instead of delving into numerical data, I would like to try a metaphor. Imagine yourself in modern day Beijing. You need to get yourself, your wife and your two kids to some remote destination 30 miles away. Now try to picture the expression on the unsuspecting rickshaw driver's face as you ask him to cart you and your family that very distance, all for a cost of $3.00.

In other words, this stuff(hydrocarbons) is useful, versatile and at this point, relatively cheap. With the emerging economies of China and India posting nearly double digit year over year growth, energy intensity, in particular demand for oil is expected to expand well into the 21st century. I could elaborate using widely accessible date, but I find this redundant since society is largely in agreement that energy demand is here to stay. I will instead, save the monotonous numerical crunching for later on in this editorial.

Now if we are in agreement on the aforementioned, we can agree that we need to identify viable alternative sources. I use the word viable here because it is so often omitted when discussing alternative energy. By viable, I mean a source that is renewable, easily integrated into existing infrastructures and most importantly; economically attractive when compared to its fossil fuel counter parts. This excludes you hydrogen and your cohort corn ethanol.

By this premise, only one fuel source comes to mind, and that is in fact biodiesel. Biodiesel refers to a diesel-equivalent manufactured from biological (renewable) sources which can be combusted in unmodified diesel vehicles. Wikipedia describes this chemical compound as: "Alkyl esters made from the transesterification of vegetable or animal fats."

Biodiesel is enticing for several reasons. First, it can be easily integrated and utilized into existing fueling infrastructures and vehicles. By vehicles, I am not referring to our average America commuter, but to the tens of millions of trucks, trains and boats which burn diesel on a daily basis. Unfortunately in the US, only around 3% of the vehicles on the road use diesel. While this is paltry compared to Europe's 50%, these numbers are expected to increase.

This brings me to my next point. Unlike ethanol, the alternative for gasoline; biodiesel and diesel boost comparable energy content at 37.8 MJ/kg and 48.1 MJ/kg, respectively. Unlike ethanol's 30% compromise in fuel efficiency, a truck powered by biodiesel will average nearly identical fuel economy compared to its diesel powered counterpart.

This brings me to my final point. Biodiesel is renewable. Some will attempt to argue that there is an endless supply of oil yet to be discovered, but the most fundamental principle of economics states there is endless demand for finite resources. While this doesn't mean we will run out of oil tomorrow or in ten years, it does indicate that as supply diminishes and demand increases oil will become more expensive.

Currently on the commercial scale, biodiesel is produced using virgin plant oils. While this is great in theory the numbers aren't as enticing. What would happen to these producers if the $1.00 per gallon federal tax credit were withdrawn? More importantly, what would happen if the spot price of crude oil were to drop significantly? While these two scenarios seem unlikely given the current political environment, they do poise interesting concerns regarding biodiesel's economic viability.

Where concern dwells so too does opportunity. Theoretically, biodiesel producers could cut costs using economics of scale such as Imperium Renewables and Archer Daniels Midland are attempting to do. These companies and many more like them may in fact prove successful, but there lies an even more efficient method for drastically cutting variable costs.

Last month a micro cap, by the name of Syntroleum launched a joint venture with Tyson Foods to build and co-operate a 75 million per year refinery. This venture is exciting because they intend to use fats, greases and reclaimed vegetables oils as their primary feedstock. For producers this truly is the holy grail of biodiesel. Since the feedstock is the largest variable cost, the more inexpensive the feedstock the more profitable the producer. While SYNM and TSN are targeting 2010 as their completion date, there is in fact one biodiesel producer whose been doing this continuously at a 80,000 gallon pilot plant since 2003 and commercially since October of 2006. Before I get into the specifics of this company, I believe it is prudent to walk through the basic economics.
Given that the feed stock comprises 60-75% of the finished products cost, it becomes imperative to process the lest expensive sources. The problem is, the cheaper the feedstock, the higher the fatty free acid(FFA) content and in turn the greater the difficulty to refine.

Corn oil for example, fetches around $.30-.34 per pound with a FFA of around 1%. While this feedstock is incredibly easy to process, its usage equates to a variable cost of ($.30 x 8lb = $2.40 per gallon)(8lb = 1 gallon).

Mechanically complete 20 million gallon per year facility.

With operational costs ranging from $.42-.53 and diesel rack prices nearing $3.11, there isn't much room for profit margins or excess funds to recoup the plant's initial capital cost. However, with the current federal tax credit biodiesel producers can remain competitive if they sell the biodiesel for $3.11($2.40+.45= 2.85, $3.11-2.85+1.00= $1.20 profit per gallon).

The story is even more appealing when we cut feedstock costs. Take yellow grease for example. When the FFA exceeds >20% the cost drops to under $.15. With these prices a producer could refine biodiesel for half the cost($.15 x 8lb = $1.20+.45= $1.65, $3.11-1.65+1.00= $2.46 profit per gallon). Note: these numbers exclude the Oklahoma $.25 tax credit as well as the $.50 federal BTU sludge tax credit.

One final thought on numbers. The company which I shall mention shortly will have a combined annual capacity online by Q2 2008 of 70 million gallons. Interestingly, all of the feed stocks and refined biodiesel are already locked up in contracts signed last year. This means that as of next year they will be netting close to $172,200,000. Given the 109,998,692 shares outstanding and an industry average P/E of 9.9, the company should post an EPS of $.64 and a PPS of $6.34(9.9x.64). These numbers, although estimations indicate an extreme discount when compared to current market valuations.

As I mentioned before the company, Nova Biosource Fuels, Inc.(NBF) isn't talking about doing it they are doing it. Currently, the company is in various stages of permitting and building three refineries for their own portfolio with the capacity to process 25 various feed stocks into biodiesel which meet and exceeds ASTM D 6751 standards.

Why do I believe this company will succeed? Aside from the hurdles of finding funding and pioneering new technology, I look to management. Who is running the company and why? When concerning quality, NBF boosts one of the most impressive micro cap management lineups I have ever seen. Interestingly, they are all high caliber ex-oil men originating from the likes of Texaco, Halliburton Energy Services, Vanco Energy, Mobil Exploration, and Kerr-McGee Chemical.

The next question is why? Why are all of these ex-oil executives and presidents running a $300 million micro cap start-up? Basic speculation brings me to a logical answer. Big oil is in the business of making money. They have been 'banking coin' for years and they will continue to do so for many more to come. So to answer my question, the real reason these men choose NBF, is they know its technology enables them to produce biodiesel and do so economically.

NYK to ship 60,000 tons of wood pellets a year

NYK Global Bulk Corporation, a wholly owned subsidiary of NYK, has signed a long-term contract with Kansai Electric Power Co. Inc. (KEPCO) to transport wood-pellet fuel* from Canada.

Shipping & Shipbuilding News - 28 June 2007

Power company seeks to reduce emissions with biomass fuels

NYK Global Bulk Corporation, a wholly owned subsidiary of NYK, has signed a long-term contract with Kansai Electric Power Co. Inc. (KEPCO) to transport wood-pellet fuel* from Canada.

Some 60,000 tons of wood pellets will be shipped annually for five years from Prince Rupert in the Canadian province of British Columbia to Maizuru in Japans Kyoto prefecture for delivery to the utility company. NYKs handy bulkers, 20,000- to 30,000 DWT bulk carriers, will be used to fulfill the contract, which starts in 2008.

KEPCOs Maizuru Power Plant is now implementing a project to reduce its carbon dioxide emissions, a by-product of power generation, by about 92,000 CO2 tons annually. The combining of biodegradable fuel (biomass), such as wood pellets, with coal is part of this project. NYK Global Bulk Corporation expects seven or eight roundtrips between Japan and Canada each year to transport the 60,000 DWT cargo volume needed for KEPCO to achieve its target.

The multiyear contract is the first of its kind in Japan. Demand for biomass fuels, including bioethanol and wood pellets, has grown steadily in recent years as a countermeasure to environmental problems such as global warming. NYK intends to foster and secure new business in the biomass fuel transportation market, while emphasizing its support for the use of environmentally friendly energy sources.


* Wood-pellet solid fuel is made by compressing and shaping waste wood, such as that from wood manufacturing and waste processing. The wood pellets are shaped into a cylinder that has a radius of 6 to 8 millimeters.

KNM wants to build renewable energy facilities overseas

By IZWAN IDRIS (The Star Online) Wednesday July 25, 2007

SERI KEMBANGAN: KNM Group Bhd is eyeing jobs to build renewable energy facilities overseas after securing its first contract at home, managing director Lee Swee Eng said. 

This includes bidding for a project to construct an ethanol plant in Brazil, where the group's process equipment manufacturing facility was targeted to start operation early next year. 

"Part of KNM's growth strategy is to tap into the renewable energy sector,'' Lee told reporters after the signing ceremony for a RM122mil contract to design and construct a biodiesel plant for Mission Biofuels Ltd, a company listed in Australia. 

The KNM group currently has 11 process equipment manufacturing facilities, five of which are in Malaysia, two in Australia and one each in Italy, China, the United Arab Emirates and Indonesia. 

The biodiesel plant, which is to be Mission Biofuels' second in the country, is located next to its existing site in Kuantan Port, Pahang. 

The new plant is targeted to have a biodiesel production capacity of 250,000 tonnes annually when completed in August next year, compared to the first plant capacity of 100,000 tonnes a year. 

The first plant would start shipment by mid-September this year, Mission Biofuels' managing director Nathan Mahalingam said at the press conference after the ceremony on Wednesday. 

"Even at current crude palm oil (CPO) prices, the project is still feasible,'' he said. 

He added that although there are concerns that bio-diesel plants are not viable - with CPO price in the futures market at above RM2,500 per tonne - the company had already secured a five year off-take agreement with a major European based buyer for a large portion of its targeted combined 350,000 tonnes a year output. 

Mission Biofuels also has a feedstock supply agreement with Cargill, which is building a palm oil storage facility in Kuantan Port.  

Mahalingam said apart from biodiesel, the plant would also produce other high value products such as pure glycerine that would allow the venture to remain profitable. 

The 250,000 tonnes per year capacity plant would be the largest biodiesel plant in Malaysia and the first in Asia to use the latest technology from Axens of France.

$100 Oil Price May Be Months Away, Say CIBC, Goldman (Update1)

By Mark Shenk

A woman pumps gasoline into
her vehicle

July 23 (Bloomberg) -- The $100-a-barrel oil that Goldman Sachs Group Inc. said would prevail by 2009 may be only a few months away.

Jeffrey Currie, a London-based commodity analyst at the world's biggest securities firm, says $95 crude is likely this year unless OPEC unexpectedly increases production, and declining inventories are raising the chances for $100 oil. Jeff Rubin at CIBC World Markets predicts $100 a barrel as soon as next year.

``We're only a headline of significance away from $100 oil,'' said John Kilduff, an analyst in the New York office of futures broker Man Financial Inc. ``The unrelenting pressure of increased demand has left the market a coiled spring.'' New disruptions of Nigerian or Iraqi supplies, or any military strike against Iran, might trigger the rise, Kilduff said in a July 20 interview.

Higher prices will increase revenue for energy producers from Exxon Mobil Corp. to PetroChina Co., while eroding profit at airlines including EasyJet Plc and railroads such as Union Pacific Corp. The U.S. and other oil-importing nations risk accelerating inflation, while higher energy costs threaten to restrain growth.

Benchmark crude oil futures ended last week at $75.57 a barrel on the New York Mercantile Exchange, up 51 percent since mid- January and twice the level of early 2003. A record number of options have been sold that give the buyer the right to buy crude oil at $100. The contracts, covering 50 million barrels, only pay off should oil go above the target price. September crude futures fell 89 cents to $74.90 at 11:16 a.m. in New York today.

Goldman's View

Arjun Murti, a New York-based Goldman Sachs analyst who covers oil producers and refiners, roiled markets in March 2005 with a report saying prices could touch $105 a barrel during a ``super spike'' period because demand was stronger than anticipated. Price swings might also go as low as $50, Murti said at the time.

Currie, Goldman's global head of commodities research in London, is predicting that oil prices will probably touch a record and stay at unprecedented levels for months or years. The all-time high for Nymex crude futures is $78.40 a barrel on July 14, 2006.

``Ultimately, the key to the outlook going forward is when will Saudi Arabia ramp up production,'' he said in an interview. ``If you have a situation in which inventories globally get drawn to critically low levels, the volatility in this market is likely to explode, which significantly increases the probability of $100 oil.'' Oil might slip to $73.50 if OPEC were to start producing more now, he said.

The Organization of Petroleum Exporting Countries is scheduled to next meet in September. No members have called for a gathering before then. A decision to raise output at that time would lead to greater supplies toward the end of the year.

Accelerating Demand

The failure of near-record fuel prices to restrain global oil demand growth is what concerns Rubin, chief strategist at the brokerage unit of Canadian Imperial Bank of Commerce in Toronto.

``Prices have doubled, and demand is alive and well and accelerating,'' Rubin said in a July 18 interview. ``The argument that rising prices would choke demand and bring increased output is falling to the wayside.''

A National Petroleum Council study led by former Exxon Mobil chairman Lee Raymond, released last week, predicted a growing gap between production and demand for oil and gas during the next two decades. As recently as 2005, Raymond said oil prices had probably peaked and dismissed the possibility that supply and demand could not be brought back into balance.

``There are questions about whether the oil industry can keep up with demand,'' U.S. Energy Secretary Samuel Bodman said last week, commenting on the Petroleum Council report.

Gasoline Sales Rise

Gasoline pump prices averaging more than $3 a gallon across the U.S., the consumer of 25 percent of the world's oil, haven't dented sales. Deliveries of gasoline were a record 9.23 million barrels a day in the first half of this year, according to a July 18 report from the American Petroleum Institute in Washington.

``It appears that high prices are acceptable to the American consumer,'' said Robert Ebel, chairman of the energy program at the Center for Strategic and International Studies in Washington. ``People want the house with a yard and white-picket fence so they are moving further and further out of the cities. They have to just get up earlier and drive further.''

Outside the U.S., demand increases are being led by India and China, where growing economies mean more cars and trucks and more factories that burn oil and gas.

Consumption between now and the end of the year will increase by 3.6 million barrels a day because of seasonal shifts. The rise is equal to the daily production of Kuwait and Oman combined, and it comes after OPEC twice in the past year cut production to support prices.

Rising Costs

The cost of finding and pumping oil is rising steadily, convincing analysts such as Rubin and Deutsche Bank AG chief energy economist Adam Sieminski that higher prices will last. Shortages of deepwater drilling ships and rigs has pushed daily rents to records, and the skilled workers needed to run rigs, weld pipes, pilot vessels, fix refineries and build oil-sands projects command ever-higher wages.

``Three years ago we were calling for $30 oil, then $35 and then $40 oil,'' said New York-based Sieminski, who last week raised his forecast for the average price of oil in 2010 to $60 a barrel from $45.

``I've gotten tired of increasing these forecasts in $5 increments,'' Sieminski said in an interview. ``Something has happened. Costs have continued to escalate, and the geopolitical situation has gotten worse.''

The $60-a-barrel forecast for 2010 is 15 percent higher than the average analyst forecast, Sieminski said. The projection probably will turn out to be too low, he said.

Oil prices could triple in three months to more than $200 a barrel, given the right circumstances, according to Matthew Simmons, chairman of Simmons & Co., a Houston investment bank.

`Still Cheap'

``Oil is still cheap,'' Simmons said. ``In the 20th century, with a few exceptions, oil was almost free. The only exceptions were during 1973, 1979 and when Iraq invaded Kuwait.''

Prices rose in 1974 after an oil embargo that followed the Arab-Israeli war and from 1979 through 1981 after Iran cut oil exports. The average cost of oil used by U.S. refiners was $35.24 a barrel in 1981, according to the Energy Department, or $79.67 in today's dollars.

While crude oil prices are approaching the records they set at this time last year, not everyone is convinced $100 crude will happen. From their peak, oil futures began a six-month slide. They got below $50 on Jan. 18 before rebounding.

``The risk parameters are somewhat different than a year ago, however the overall situation is similar,'' said Tim Evans, an energy analyst at Citigroup Inc. in New York who correctly predicted a year ago that oil prices were at a peak. ``We've priced in a shortage that is not evident yet.''

Pickens' Opinion

A pullout from Iraq may be the event that pushes oil to $100 a barrel, according to Boone Pickens, the Dallas hedge fund manager who has joined Forbes Magazine's list of billionaires because of his bullish bets on energy prices. Pickens predicted a year ago that $100 oil would probably occur by now. Today he is looking for $80 within six months, and he says growing chaos in Iraq would be a bad sign. ``That could run prices pretty high,'' he said.

Goldman Sachs's Currie also notes similarities to a year ago, with global inventories at about the same level and U.S. government data showing an increasing bet on higher prices.

``At face value this market is strikingly similar to a year ago,'' Currie said. ``What is different? Supply is down a million barrels a day, demand is up a million barrels a day. The market is in a deficit.''

European Transportation Biofuel Consumption Up 78% from 2005 to 2006

24 July 2007

Consumption of biofuels by country. Click to enlarge.

Consumption of transportation biofuels in the 25-member European Union jumped 78% from 2005 to 2006, rising from 3 million to 5.38 million tonnes of oil equivalent (toe), according to the Biofuels Barometer published by EurObserv'ER, a renewable industry consortium. That increase resulted in biofuels representing a 1.8% share of the total consumption of transportation fuels, compared to a 1% share in 2005.

In 2006, biodiesel represented 71.6% of the energy content of biofuels dedicated to transport, far out ahead of bioethanol (16.3%) and other biofuels (12.1%). Of the "other" biofuels, pure vegetable oil accounted for 629,809 toe (11.7% of total biofuel consumption) and biogas for 13,940 toe.

The consumption of crude vegetable oil is primarily driven by Germany, where it is legally considered a full-fledged fuel, according to the report.

Biodiesel consumption is growing the most rapidly, with an increase of 71.4% between 2005 and 2006, compared to a 57.5% growth in bioethanol consumption. Consumption of the other biofuels was multiplied by 3.4 in a single year.

Germany continued to be the largest European consumer of biofuel in 2006, accounting for 2.8 million tonnes of biodiesel, according to the AGEE Stat, the statistical organization of the Ministry of the Environment. The 2.8 million tonnes of biodiesel represents 2.408 million toe. German consumption of vegetable oil was 0.71 million tons of vegetable oil (628,492 toe) and 0.48 million tons of bioethanol (307,200 toe).

This consumption corresponds to a 6% share by energy content of biofuels, the largest for an EU country.

France remained the second largest European biofuel consumer in 2006. French consumption increased by 62.7% to reach, according to the Ministry of Industry, 682,000 toe (i.e. 1.6% of French domestic fuel consumption). Biodiesel represents the biggest share (78%, far ahead of bioethanol with 22%).

Global Voluntary Carbon Market Grows by 200 Percent in 2006

NEW YORK, July 24, 2007 -- The voluntary carbon market grew by 200 percent last year, and is expected to set more records in 2007, according to a report released last week.

The Ecosystem Marketplace and New Carbon Finance commissioned "State of the Voluntary Carbon Markets 2007: Picking Up Steam," an assessment that analyzed current trends, buyer motivation and pricing history. The results included predictions that the market would continue growing in leaps and bounds, despite potential future legislation.

"This report underscores the importance of transparent and robust standards to ensure quality and credibility within the emerging emission reductions market. For buyers worldwide, the quality of the offset is of paramount concern," said Eron Bloomgarden, EcoSecurities U.S. Country Director. "Continued development of rigorous industry protocols will play a critical role in the continued maturation of the voluntary offset market."

The report valued the global carbon market at $91 million in 2006, with about 23.7 million tons of carbon dioxide emissions transacted. The volume-weighted average price was $4.1 per ton. Projects with strong quality and verifiable attributes, such as landfill methane, coal mine methane and forestry, commanded the highest prices.

During the last five years, the number of companies supplying carbon credits has grown by 200 percent. Projects that involve forestry sequestration, renewable energy and industrial gases accounted for the bulk of projects, the report said. The market provides ample opportunity for smaller projects that generate less than 5,000 tons of carbon emissions.

North American and European markets drove most of the demand in the voluntary carbon market, the report found.

"Survey respondents reported that 68 percent of their customers are based in the United States and 3 percent in Canada," the report said.

The European Union accounted for 28 percent of respondents' customers, and more than 30 percent of suppliers of carbon offsets.

Overall, the largest buyers of carbon offsets were businesses. The report found that corporate social responsibility drove the market, with large gains coming from North American markets. The ran counter to researcher expectations, who anticipated that the possibility of future regulation would play a larger role in the decisions to buy carbon offsets.

The report urged the implementation of industry standards, certification and verification processes to reduce the "buyer beware" market.

Wells Fargo Loans $1 Billion for Green Projects

SAN FRANCISCO, July 23, 2007 -- Wells Fargo has financed $1 billion to construct LEED certified buildings, the company announced Thursday.

The company has bankrolled 19 LEED buildings in 10 states. The loans ranged from $10 million to $225 millions each for projects that include schools, condominiums, apartments and offices.

These buildings include water efficient landscaping and stormwater collection systems that catch and recycle rain and gray water. Green roofs help conserve energy while features that address air quality, such as efficient ventilation and low-emitting materials, are implemented. Some buildings sport built-in recycling areas and renewable solar or geothermal energy sources.

"We can help protect the environment by supporting the development of energy efficient buildings," said Larry Chapman, head of Commercial Real Estate at Wells Fargo, in a statement. "Wells Fargo has set ambitious lending targets and will continue to develop our expertise by training our lenders about green building practices."

The bank most recently loaned $42.7 million to Thomas Properties Group to build a 192,000 square-foot complex in Austin, Texas. The two three-story buildings called Four Points Centre is expected to earn LEED certification.

Past projects include a $20.5 million two-year construction loan for the Banner Bank Building in Boise, Idaho. The bank took into consideration lower operating expenses from the building's green functions. The 11-story, 184,000 square-foot office building will have digital lighting controls that use occupancy sensors, photocells and dimming ballasts to boost energy conservation. Stormwater will be reclaimed for use in the bathrooms while underfloor air distribution will improve energy conservation and air quality. The building is expected to earn LEED gold certification.

The company has worked to reduce its own environmental footprint, said Company Spokeswoman Stephanie Rico.

"Since about 2000, our corporate property group has focused on conserving energy in our buildings," Rico said, adding that the company has 500 "smart buildings" that are wired to control energy efficiency from a centralized point.

It has six buildings, including its headquarters, are Energy Star-rated for top performance in energy efficiency and its data centers use energy saving free-cooling centers.

The company offers several tool to educate its customers about the benefits of green building. For instance, its home equity group partnered with Build It Green to create an online toolbar that gives tips on greening an existing home. Its national builders division created a toolkit to support green homebuilders. Wells Fargo is working with the U.S. Green Building Council to create a prototype for LEED banking stores.

Customers can potentially use green building improvements to qualify for larger loans based on energy savings. The company also offers the Green EQ2, a loan with a low interest rate intended to help non-profit organizations in low- to moderate-income neighborhoods build affordable green housing. The five to 10-year loans range from $150,000 to $300,000, with an interest rate between 2 percent and 3 percent.

VeraSun Energy Buying 3 Ethanol Plants From ASAlliances Biofuels for $725 Million

Monday July 23, 7:10 am ET

BROOKINGS, S.D. (AP) -- Ethanol producer VeraSun Energy Corp. said Monday it is buying three ethanol plants from ASAlliances Biofuels LLC for $725 million.

The acquisition will be funded with $250 million in cash, $200 million of equity and $275 million in project financing.

The facilities have a combined annual production capacity of 330 million gallons per year and are each expected to operate at 110 million gallons per year. VeraSun currently has 340 million gallons per year of production capacity, with another 330 million gallons per year under construction and development.

The plants are located in Albion, Neb.; Bloomingburg, Ohio, and Linden, Ind. The Linden facility will begin operating this month, with Albion coming on line in the fourth quarter and Bloomingburg operating by early 2008.

ASAlliances Biofuels plant workers will become VeraSun employees when the sale closes, which is expected in 30 to 45 days.

Malaysia to use waste biomass from palm oil as a renewable energy resource

Tuesday, February 06, 2007

The palm oil industry in South East Asia is trying to clean up its act by investing in increased energy efficiency and by using waste streams from palm oil processing as a renewable and clean alternative to costly fossil fuels. A comparison with Brazil's highly efficient ethanol industry comes in handy here: it uses all generated biomass waste in an integrated manner, to power both the sugar extraction process and the ethanol production process with steam, heat and electricity. Excess electricity is fed into the national grid. The result of this finetuned process design is a fuel with a very positive net energy balance and a cost reduction of over 75% in 25 years time. Efforts to increase the efficiency still further, using advanced modelling and process design, are underway and successful. And likewise, the trend in both cost reductions and better energy balances is set to continue.

Palm oil producing countries have no tradition in applying similar methods, though. But given high energy prices, this is changing rapidly. In Thailand, the government is encouraging the use of palm oil mill effluents for the production of biogas, whereas in Malaysia, an experimental palm processing plant that has been using biomass residues since 2003, showed such encouraging results that the country's Deputy Prime Minister, Datuk Seri Najib Tun Razak, now calls on the project managers to study the implementation of the method on wider use at every level of the country's industrial sector. The minister said the move was crucial as this type of biomass energy was not only cheaper but also more efficient and environment-friendly than the use of fossil fuels. Moreover, its use brings additional incomes to the palm industry, which might change the prevailing logic which consists mainly of expanding plantation areas.

Vast amount of 'waste' biomass for energy
The biofuel in question consists of 'empty fruit bunches' (EFB) and fiber-rich press cake, which result from processing palm fruits. A palm oil plantation yields a staggering amount of harvesteable biomass (some 50 to 70 tons per hectare per year), and only 10% of this total results in the finished products: palm oil and palm kernel oil.

Until recently, the remaining 90% (empty fruit bunches, fibers, fronds, trunks, kernels, palm oil mill effuent) was discarded as waste, and either burned in the open air or left to settle in waste ponds. This way, the palm oil processing industry's waste contributed significantly to CO2 and methane emissions.

The waste biomass is now seen as a valuable energy resource and as a feedstock for bio-based products (bioplastics, fiber-board). Malaysia alone produces some 168 million tons of this waste annually, representing roughly 2 exajoules of energy, the equivalent of around 330 million barrels of oil. No wonder the Malaysian government is looking at using the resource as an alternative to costly fossil fuels:

The Felda plant
Felda Palm Industries Sdn Bhd (FPISB), which operates the first 7.5MW integrated biomass co-generation plant at its palm processing facility, is encouraged by the government to invest R&D efforts and to study the feasibility of applying the model throughout the country's industrial sector. Construction of the 38 million ringgit (€8.4/US$10.9 million) Felda Sahabat biomass plant started in August 2003 and began operations in October 2006.

Deputy Prime Minister Najib: "I'm aware the government is encouraging renewable energy sources. Hence, Felda should invest in this sector so that it can complement the government's plan to expand electricity production using renewable energy sources. This power plant in Felda Sahabat here, the first to be built by Felda, produces electricity using the biomass method."

The Felda management had two options whether to use diesel or biomass for the power plant. They opted for the more economical and cheaper biomass method," he told reporters after opening the power plant at Felda Sahabat, about 100km from here, Tuesday.

Najib called for more research and development in biomass-based power generation as it was not only new in Malaysia, it was also in line with the country's emphasis on renewable energy sources.

"I hope we can build more biomass-powered new power plants like the biomass power station in Felda Sahabat which is cheaper, efficient and more competitive," he said.

Asked on the possibility of building more biomass-powered power plants nationwide in future, Najib said it would depend on the research findings and the price offered.

"If Tenaga Nasional Berhad offers a lower price from the rate quoted for power generated from biomass-fuelled plants, surely it is not economical," he said.

Asked whether Felda would take in new settlers, Najib said though the agency's decision to freeze settlers' intake since 1990 was still in force, it was prepared to reconsider if there were suggestions from any state to alienate land for Felda estates.

Earlier, in his speech, Najib said it was time Felda set up a subsidiary to focus on research and development of biomass-based products. "I'm very happy with Felda's overall achievements and in particular the Felda Sahabat biomass power plant which uses waste products to give returns. "I hope Felda will continue to diversify the use of every energy source to its optimum," he said.

Global warming, Kyoto, Clean Development Mechanism
On global warming, Najib said it was a universal problem that needed to be jointly addressed.

"The floods that lashed our country recently were said to be caused by global warming. Many conferences have been hosted and various organisations have been set up to find solutions to this problem," he added.

Najib said the latest United Nations report revealed the warming level to be increasing every year and the main cause of global warming was the use of fossil-based fuel for energy production.

"The Kyoto Protocol declaration had underlined measures to reduce global warming through three flexible mechanisms -- joint implementation, clean development mechanism and international emission trading. "Malaysia recognises the Kyoto Protocol to fulfil the global commitment in the interests and safety of future generations."

Recently, several companies have started implementing so-called Clean Development Mechanism (CDM) projects in Malaysia's and Indonesia's palm oil sectors. The CDM allows industrialised countries to offset some of their CO2 emission reduction obligations under the Kyoto Protocol by investing in clean energy and efficiency projects in the developing world for which they receive CO2 credits.

One example is that of Japan's Chubu Electric Power, which has decided to participate in a new project to generate power from oil palm empty fruit bunch biomass in Malaysia. This project will develop small-scale 10,000 kW power plants using empty fruit bunches as fuel in two locations in the eastern portion of the state of Sabah, on Malaysia's Borneo Island. From the power plants in these two locations, reductions of CO2 emissions are expected to reach nearly 2 million tons by the year 2012. To start, the first power plant is slated to begin operations in March of 2008, with construction breaking ground in August of this year.

Picutre: Deputy PM Datuk Seri Najib Tun Razak is given a briefing on biomass-based electricity generation after opening the power plant at Felda Sahabat. Also present is Felda Chairman Tan Sri Dr Yusof Nor (left). Courtesy: BERNAMA.

Updated World Oil Forecasts

The comprehensive article on The Oil Drum that details his  highly documented views on the supply, demand and prices, for total liquids, crude oil and oil discovery rates which paints a rather bleak picture for our liquid supply. 

This figure summarizes it all for me.

I know some of you will disagree with this analysis, but I challenge you to document a more optimistic scenario. Please read the whole post if you are interested.

U.S. oil may hit $95 if OPEC does not hike output: Goldman

Mon Jul 16, 11:10 AM ET

NEW YORK (Reuters) - U.S. crude price could top $90 a barrel this autumn and hit $95 by the end of the year if OPEC keeps oil production capped at current levels, Goldman Sachs said in a report issued on Monday.

U.S. oil prices have risen to near $74 per barrel, driven this month by higher demand and lower supplies, the report said, pointed out that such fundamentals could tighten further unless key OPEC members hike output.

"We believe an increase in Saudi Arabian, Kuwaiti and UAE (United Arab Emirate) production by the end of the summer is critical to avoid prices spiking above $90 a barrel this autumn," the report stated.

OPEC agreed last year to lower output by 1.7 million barrels per day (bpd), and Goldman said global oil production is down about 1 million bpd from last summer's levels.

Disappointing output growth from non-OPEC producers also helped tighten supplies, Goldman said, adding global demand was up by 1 million bpd from year-ago levels.

"Our estimates show that keeping OPEC production at current levels and assuming normal weather this coming winter, total petroleum inventories would fall by over 150 million barrels or 6.5 percent by the end of the year, which would push prices to $95 a barrel without a demand response," the report forecast.

A decision by OPEC to open the taps could take $5 to $10 off the price of a barrel of crude as some speculators exit the market, although the fall might be brief.

"Such a pullback would likely prove temporary as long as global economic growth remains strong, and the consequent reduction in oil spare capacity would increase the market vulnerability to unexpected oil supply disruptions," Goldman said.

Oil to hit $100 in 2008, predicts bank

Jul 18, 2007 09:39 AM

Canadian Press

A "steady ascent" of crude oil prices toward $100 (U.S.) a barrel continues, but the predicted date when that level will be hit remains a moving target, according to a CIBC World Markets report Wednesday.

The investment banking division of the Canadian Imperial Bank of Commerce (TSX: CM) predicts "new record highs of $80 a barrel this year and reaching as high as $100 a barrel by the end of 2008 as soaring oil demand outpaces growth in global supply."

However, CIBC World Markets had predicted in September 2005 that oil prices in 2007 would average $93 (U.S.) a barrel and reach $100 by late this year.

Last February, it projected an average price of $69 a barrel for this year, down from a previously reduced expectation of $80.

Oil is currently at about $74 a barrel.

But triple-digit prices "are on the horizon and may be permanent as major oil-producing countries in the developing world reduce exports to meet soaring demand at home," according to the latest projection.

In countries such as Venezuela and Iran, declining oil production and increased consumption are eating into export capacity and will reduce crude oil exports by as much as 2.5 million barrels a day between now and the end of the decade, it predicts.

"It's far from obvious who will fill that supply gap," said CIBC World Markets chief economist Jeff Rubin.

"What is obvious is that if that gap isn't filled, not only are triple-digit oil prices on the horizon, but even more problematic, are here to stay."

"Facing the Hard Truths about Energy"

"Accumulating risks to the supply of reliable, affordable energy" require an integrated national strategy, according to a major new report by the National Petroleum Council (NPC).

The 18-month study of global energy to 2030 involved more than 350 experts from diverse backgrounds and organizations—the majority of them from outside the oil and gas industry.

A list of five core strategies and the hard truths about the global energy future give an indication of the point of view of the report.

The report identifies five core strategies for meeting future energy challenges:

• Moderate the growing demand for energy by increasing efficiency of transportation, residential, commercial, and industrial uses.
• Expand and diversify production from clean coal, nuclear, biomass, other renewables, and unconventional oil and natural gas; moderate the decline of conventional domestic oil and gas production; and increase access for development of new resources.
• Integrate energy policy into trade, economic, environmental, security, and foreign policies; strengthen global energy trade and investment; and broaden dialogue with both producing and consuming nations to improve global energy security.
• Enhance science and engineering capabilities and create long-term opportunities for research and development in all phases of the energy supply and demand system.
• Develop the legal and regulatory framework to enable carbon capture and sequestration (CCS). In addition, as policymakers consider options to reduce CO2 emissions, provide an effective, global framework for carbon management, including establishment of a transparent, predictable, economy-wide cost for CO2 emissions.

The United States and the world face hard truths about the global energy future over the next 25 years:

• Coal, oil, and natural gas will remain indispensable to meeting total projected energy demand growth.
• The world is not running out of energy resources, but there are accumulating risks to continuing expansion of oil and natural gas production from the conventional sources relied upon historically. These risks create significant challenges to meeting projected energy demand.
• To mitigate these risks, expansion of all economic energy sources will be required, including coal, nuclear, renewables, and unconventional oil and natural gas. Each of these sources faces significant challenges—including safety, environmental, political, or economic hurdles—and imposes infrastructure requirements for development and delivery.
• "Energy Independence" should not be confused with strengthening energy security. The concept of energy independence is not realistic in the foreseeable future, whereas U.S. energy security can be enhanced by moderating demand, expanding and diversifying domestic energy supplies, and strengthening global energy trade and investment. There can be no U.S. energy security without global energy security.
• A majority of the U.S. energy sector workforce, including skilled scientists and engineers, is eligible to retire within the next decade. The workforce must be replenished and trained.
• Policies aimed at curbing CO2 emissions will alter the energy mix, increase energy-related costs, and require reductions in demand growth.

The press release summarizing the report are on the Energy Bulletin, with links to the official summary, the full report and comments by Secretary Bodman, ASPO, and The Oil Drum.

Biofuels will account for 15% of road transport fuel market by 2030 - Global Insight study

17th July 2007

Market analyst Global Insight, Inc. says in a new study, "The Biofuels Boom: Implications for Automotive, Agriculture & Energy," that more than 100 billion gallons of bioethanol and biodiesel will be produced globally per year by 2030, an amount equal to more than 15% of the world's road transport fuel needs.

Among several major conclusions about current and future technologies, the study reports that:

- Projected technological improvements could result in biofuels representing 15% of the global motor fuel demand and as much as 35% of demand in the U.S. and Brazil

- Corn- and sugarcane-based feedstocks will remain the lowest-cost sources of bioethanol in the world

- Automotive manufacturers do not require technological breakthroughs to adapt to reasonable levels of biofuels and can and will respond to clear direction in the area of biofuels.

Non-food crops, such as jatropha and pond-grown algae will become important sources of biodiesel, reducing dependency on edible oils. The study also found that biodiesel levels of 5% are possible in virtually all vehicles and that new vehicles can be developed to accept blends up to 30%.

The study was conducted by Global Insight's Agriculture, Automotive and Energy Groups who worked with some 20 companies and organizations representing different perspectives of the biofuels industry. The Global Insight study was released at a conference in Monaco sponsored by the Foundation Prince Albert II de Monaco.

Cleantech America LLC's 2nd Utility Scale Photovoltaic Solar Farm for Fresno Area would be the Largest in the World

FRESNO - Kings River Conservation District (KRCD) and San Francisco, CA-based Cleantech America, LLC, today announced that they have entered into a multi-year agreement for Cleantech America to provide up to 80 megawatts of utility scale, emission-free, peak solar power to the recently formed San Joaquin Valley Power Authority (SJVPA).

Under the plan, KRCD and Cleantech would develop renewable solar energy for the Authority's Community Choice customers throughout the San Joaquin Valley. Upon full build-out, KRCD's Community Choice Solar Farm would be the nation's largest utility scale photovoltaic facility by far providing reliable, cost effective green energy to Central Valley residents and businesses using Community Choice power.

The memorandum of understanding calls for the facility to be developed in phases of 10 megawatts in 2009, 30 megawatts in 2010 and 40 megawatts in 2011, for a total of 80 MW. Currently the largest announced facility in the U.S. is a 15 MW solar plant at Nellis Air Force Base in Nevada. Cleantech America last week announced an agreement with PG&E for a 5 MW solar farm, CalRENEW-1, which also will be located in Fresno County, and will be the third largest photovoltaic facility in the Country and the largest in California.

Solar electricity on this scale would have significant beneficial, environmental, and economic impacts for the region. At full build-out, the 80 MW solar farm would avoid over 100 million pounds of CO2 emissions annually. Based on results from a UC Berkeley jobs creation survey, an 80 MW facility would create up to1,040 installation / maintenance job-years in the local area and up to 1,600 manufacturing job-years (a portion of which will be in the local area).

The SJVPA was formed in 2006 pursuant to a Joint Powers Agreement for the purpose of implementing a community choice aggregation program for the greater Fresno area of the San Joaquin Valley. California Assembly Bill 117, passed in 2002, allows cities and counties to combine the electrical loads of their constituents for bulk electricity purchases. The Authority is currently comprised of 12 member cities, as well as Tulare and Kings counties. Management of the Authority is under the direction of KRCD, which will include the procurement of generation to supply the participating customers.

"The promise of Community Choice is to have local control of our energy destiny. This means providing a choice of energy providers, stable and predictable rates, and valued added to the region through the development of new, local renewable energy sources like utility-scale photovoltaic solar which is generated within our service area, close to our energy load. Developing 80 megawatts of clean energy from the sun would take us a long way to achieving these goals while demonstrating the value of Community Choice," said David Orth, General Manager of KRCD.

Bill Barnes, CEO of Cleantech America LLC., said, "This is a visionary step by Kings River Conservation District. The extraordinary economies of scale which can be achieved by facilities of this magnitude would have a dramatic effect on helping solar energy achieve grid parity. Solar on this scale would unquestionably attract many solar manufacturing, fabrication and related jobs to the San Joaquin Valley, and further promote the region's growing image as California's 'Solar Valley.' And because in-grid zero emission solar provides peak power when it is needed most, during the hottest times of day during the hottest times of the year, it supports increased generation reliability in the region."

The San Joaquin Valley's potential for PV solar is enormous because of its great sun characteristics. PV solar is a natural fit for the Valley because it can be sited in-grid to generate clean energy close to where the power is needed directly for the benefit of those communities - areas that have long suffered from poor air quality. Many other renewables, like solar thermal and wind, have to be sited far away, and often require construction of expensive new transmission. In-grid PV solar is local-based and directly benefits the communities it serves in multiple ways.

The beneficial air quality impacts of the plan are significant. At full build-out, the 80 MW solar farm will avoid over 100 million pounds of CO2, over 87,000 pounds of SO2, over 110,000 pounds of ozone-forming NOx, and over 450 pounds of toxic mercury emissions annually [based on U.S. Environmental Protection Agency data for California's power grid (CAISO)]. The avoided climate change emissions are the equivalent to removing over 20,000 cars from the road [Source: U.S. Climate Technology Cooperation Gateway].

Plasma gasification converts waste to energy in Minnesota

Plasma torches, which can generate temperatures 3 X hotter than the surface of the sun, can also transform organic materials into syngas.

 

By Jessica Ebert

The Minnesota state legislature recently awarded $400,000 to Koochiching County in the north-central part of the state to fund a feasibility study for a potential facility that would convert municipal solid waste (MSW) into energy.

The plant, which would be located near International Falls, would use plasma torches to gasify MSW. These torches house electrodes, and when a continuous flow of electricity is applied, an arc forms between them. The air in the torch pushes this extremely hot artificial bolt of lightning into a furnace, where the MSW enters. The torrid temperatures generated by this process, which can be hotter than the surface of the sun, rip apart compounds and convert inorganic solids into a glassy obsidian-like rock that can be used in road construction. The process also transforms organic materials into syngas that can be used to make electricity and liquid fuels.

"Plasma gasification could revolutionize the whole field of waste management," said Lou Circeo, director of plasma research at Georgia Tech Research Institute. He is considered a pioneer in plasma gasification, and part of the Minnesota feasibility study will involve sending waste samples to the institute in order to test the plasma gasification process. The process has been successfully used to eliminate MSW in two facilities in Japan. Similarly, the first phase of a facility in St. Lucie, Fla.—expected to come on line in 2009—will process up to 3,000 tons of waste per day.

 

Currently, the Koochiching County Board is drafting a request for proposal, which will be used to find an engineering firm to conduct the feasibility study in Minnesota. Paul Nevanen, director of the Koochiching County Economic Development Authority, expects the study to be completed by November. "This is pretty visionary for a small county like ours," he said.

Oil prices inch up after energy report

By GEORGE JAHN, Associated Press WriterFri Jul 13, 9:54 AM ET

Oil prices rose slightly Friday, with prices gaining support from an International Energy Agency report saying global energy consumption would increase next year.

The agency also predicted mixed global refinery performance for the rest of the summer.

Light, sweet crude for August delivery advanced 9 cents to $72.59 a barrel in electronic trading on the New York Mercantile Exchange by midday in Europe. The contract settled Thursday at $72.50 a barrel, down 6 cents after dropping sharply from highs hit early in the session.

August Brent gained 14 cents to fetch $76.54 a barrel on the ICE Futures exchange in London. Vienna's PVM Oil Associates noted "two small platforms in the North Sea that have reportedly stopped producing" as helping to underpin Brent prices.

The report from the IEA — the developed countries' energy watchdog — noted that global energy consumption will likely rise at its fastest clip in recent years in 2008 but high oil prices persisting above $70 a barrel may steadily eat away at demand. The agency forecast world oil demand growth next year at 2.5 percent — 2.2 million barrels a day, based on expectations for a colder winter in the U.S. and Europe and robust industrial demand in China and the Middle East.

The Paris-based agency also forecast rising global refinery runs this summer — with possible glitches in the U.S.

It predicted global refinery runs would reach 74.2 million barrels a day in July and peak the following month at 75.2 million barrels a day, assuming U.S refinery problems ease. But the agency warned that "North American crude throughput remains constrained by the large number of refineries running at less than full capacity due to operational problems."

News that several refineries were restarting shuttered operations were expected to keep gasoline prices in check.

Analysts say the July 1 closure of a refinery in Coffeyville, Kansas, due to flooding, and the shutdown this week of a huge piece of oil processing equipment at a BP PLC refinery in Whiting, Indiana, sent prices in the Midwest and Plains states sharply higher, boosting the national average.

But BP has said its 250,000 barrel-per-day unit would be up and running by the weekend, and refinery utilization rates rose last week, according to Wednesday's inventory report from the Energy Department's Energy Information Administration.

Energy futures rose to 10-month highs after another weekly EIA report in late June showed gasoline inventories dropped when analysts had expected a gain. Gas inventories and refinery utilization levels have grown in the two weeks since, but that has done little to kill the rally.

Nymex heating oil prices were essentially flat at $2.0998 a gallon, and natural gas futures gained 6.3 cents to $6.560 per 1,000 cubic feet.

PGE banks on renewable energy

Portland Business Journal - 2:24 PM PDT Thursday, July 12, 2007

 

In a new plan filed with state regulators, Portland General Electric Co. said it will meet future demand for power with a mix of renewable resources, programs to boost energy efficiency and continued reliance on agreements to purchase power on the open market.

The Integrated Resource Plan, filed with the Oregon Public Utility Commission , describes PGE's energy supply strategy for 2008 to 2015. It is subject to public comment over the next six months and is subject to approval by the utility commission.

PGE (NYSE: POR) is Oregon's largest utility and serves nearly 800,000 residential, commercial and industrial customers.

The plan took 18 months to develop and will guide PGE as it builds on its portfolio, which includes power generated by hydroelectric projects, natural gas, coal and wind.

• The plan calls for the continued development of the Biglow Canyon wind project in Sherman County, where PGE expects to erect wind turbines with a total maximum generating capacity of as much as 450 megawatts. To be constructed in three phases, Biglow Canyon is expected to supply enough power to support about 100,000 homes, the company said. The first phase is in construction.
• To help meet Oregon's new Renewable Energy Standard, which calls on the company to meet 15 percent of demand with renewable energy by 2015, PGE says it will secure an additional 218 average megawatts of renewable power from unspecified sources.
• The company will increasingly team with the Energy Trust of Oregon to expand energy efficiency programs to meet its goal of reducing demand by 45 megawatts by 2012.
• PGE will reduce its reliance on volatile energy markets by making long term power purchases of five to 10 years in duration. Long-term agreements will help stabilize prices while giving alternative energy technology time to mature and become cost-effective.

The energy plan filed with the PUC is predicated on the assumption that demand will increase by approximately 2.2 percent per year. Combined with the expiration of existing supply contracts, PGE says its own generating facilities will fall an average of 818 megawatts short of meeting customer demand by the year 2012.

The resource plan identifies promising technology that may become feasible in the future, but which is not currently included in PGE's power generation plan. It includes wave energy, solar and clean coal.

The complete plan is available at www.PortlandGeneral.com.

Pellets become pathway for biomass company

By Jerry W. Kram

The increasing popularity of pellet-fed fireplaces and furnaces has created an opportunity for a Minnesota-based company.

Sunrise Agra Fuels LLC markets fuel pellets made from crop residues, according to company President Bob Ryan. The company started with the intent to use local resources. "We started asking questions about whether there was an opportunity to use ag residue as a fuel source," Ryan said. "We pelletize fuel in a conventional pellet die for two different uses. We have a residential grade for corn-type stoves, and we are also going to make a commercial grade in the new plant."

In its first year, the company sold about 600 tons of pellets, which were manufactured by contractors. Quality concerns interrupted the company's supply during its first heating season, but Ryan said it showed there was an enthusiastic demand for the product. "There was an extraordinary market," Ryan said. "I still get calls on a daily basis. We distributed our product no more than 150 miles from where it was manufactured, and we could have easily accomplished 10,000 tons of sales last year."

The company decided to build a plant in Bird Island, Minn., to avoid the quality problems with its suppliers. "We have been contracting with some feed mills in the area," Ryan said. "We stopped production with them this last heating season because they couldn't handle the quality we needed to have." He added that the feed mills had problems using low-density biomass, which led to an inconsistent product.

 

The plant will be operated as a separate entity from Sunrise Agra Fuels and will be a producer-owned cooperative called Prairie Agra Fuels. The plant received its permits from the Minnesota Pollution Control Agency in mid-June. Construction is set to begin in the fourth quarter of 2007 and should be completed by the end of the year. The capacity of the plant will be 70,000 tons per year. It will use corn stover and soybean straw from a 30-mile radius as its primary feedstocks. The design/builder is Marcus Construction in Prinsberg, Minn.

Another company is organizing in North Dakota to produce a similar product. NSB Valhalla in Minot, N.D., was awarded a $53,500 grant from the states Agricultural Product Utilization Commission to refine its technology for producing fuel pellets from agricultural waste for use in residential, commercial and agricultural applications.

Biomass groundbreaking event set for July 27

Posted by Judy Riley on Friday, Jul. 6, 2007 Event Date/Time: Friday, Jul. 27, 2007 11:00 am Location: Heating Plant grounds

The public is invited to attend a groundbreaking ceremony for the new biomass facility to be constructed at the University of Minnesota, Morris. The brief ceremony will begin at 11 a.m. on Friday, July 27, at the construction site located next to the campus' Heating Plant. The University of Minnesota Board of Regents gave final approval during its June meeting for construction of a biomass gasification reactor and facility at UMM. The reactor will convert corn stalks and other residual materials into a syngas – similar to natural gas - that can be burned to produce clean energy to generate heat (and cooling in the near future) for the campus. The facility will serve as a platform for UMM's research partners to identify trade-offs and opportunities surrounding gasifying other agricultural residues. "The biomass plant conceptual goals were to rethink how we use energy and explore the possibilities of using renewable agricultural based feed stocks in a sustainable manner," said Lowell Rasmussen, UMM associate vice chancellor for physical plant and master planning. "UMM approached the (University of Minnesota) West Central Research and Outreach Center (in Morris) to help in developing this plan." The project received one of 12 USDA/DOE (United States Departments of Agriculture and Energy) energy grants for $1.89 million to conduct additional research using this project. This grant, the largest received by the Morris campus to date, allowed UMM/WCROC to add the USDA Agricultural Research Service – North Central Soil Conservation Research Lab into the partnership to conduct research on carbon sequestration. The total project cost is $8,956,000, which includes grant money. Construction on the facility is scheduled for completion in spring 2008. A formal celebration is being planned for this fall.

Germany seeks to increase energy efficiency

July 05 2007 at 03:42PM

 

Germany plans to boost the percentage of electricity generated by renewable resources to 45 percent by 2030 in a bid to curb global warming, environment minister Sigmar Gabriel said on Thursday.

Gabriel told reporters that a progress report on a renewable energy law (EEG) passed in 2000 showed that the country had already surpassed the quota of 12.5 percent set for 2010.

He said Berlin was now setting a more ambitious target to produce at least 20 percent of electricity used in the country with renewable resources such as wind and solar power by 2020 and 45 percent by 2030.

"We can and must raise the bar for 2020 to generate at least 27 percent of all the electricity used with renewable resources," Gabriel said.

"This is the only way we can make a significant contribution to reaching our ambitious EU goals that we passed under the German presidency in March."

Berlin held the rotating EU presidency for the first six months of this year and made curbing climate change one of its top priorities.

The European Union set a goal in March of a 20-percent cut in greenhouse gas emissions by 2020 compared with 1990 levels, but Germany is aiming to cut up to 40 percent.

Gabriel said Germany had prevented 100-million tonnes of carbon dioxide from being spewed into the atmosphere last year thanks to renewable energy sources, adding that there were now
214 000 jobs in fields such as wind and solar power.

Chancellor Angela Merkel said on Tuesday at a meeting of political officials, industry representatives and environmental campaigners that Germany would seek to increase energy efficiency by three percent a year until 2020.

She cited fuel-efficient cars, houses with innovative heating systems and energy-saving household appliances as areas the government wanted to see developed.
 

E3 Biofuels' Efficient Closed-Loop Ethanol Plant in Operation

E³ BioFuels inaugurated the world's first closed-loop ethanol plant fueled largely by biogas from animal waste instead of coal or natural gas on June 28। The energy-efficient, low-cost Genesis Plant, located in Mead, Neb., began commercial operation in April 2007, doesn't contribute to global warming and actually reduces air and water pollution.

E³ BioFuels' patented technology brings together three proven components into a single, closed-loop system:

1. A large cattle feedlot or dairy that produces large quantities of cow manure needing treatment.
2. An anaerobic digester that transforms the cow manure into biogas.
3. An ethanol plant that runs on the biogas instead of natural gas or coal, and whose leftover wet grain is fed back to the cattle.

ThAt the Genesis plant the patented closed-loop ethanol system produces energy by combining manure, collected from an adjacent 28,000-head cattle feedlot, with thin stillage, a cellulosic byproduct of ethanol refining। The hot liquid mixture is decomposed inside an anaerobic digester, where bacteria extract methane-rich biogas that is used to fire the plant's ethanol boilers. Traditional ethanol refineries are fueled by coal or natural gas. e leftover grain is fed wet to the cattle at the nearby feedlot, whose manure in turn powers the plant and creates high-quality fertilizer as a byproduct. Traditional ethanol plants have to invest in expensive, energy-intensive equipment to dry this leftover grain to prevent spoilage, and then transport it to far-off farms to use as feed. The on-site cows are treated to fresh wet cake from the nearby plant, thus avoiding both the cost and fossil fuel pollution of drying and transporting the grain.

Greenhouse gases are reduced by capturing the methane gas, which is 23 times more potent than carbon dioxide in causing global warming, that the decomposing manure would release to the atmosphere if it were not used in the process. By recycling livestock manure into biogas energy, the system eliminates a major component of the No. 1 source of water pollution in the United States: agricultural runoff.

Construction of the $80 million plant was completed this spring and was placed into commercial operation in April. It will produce 25 million gallons of ethanol a year, and consume 300,000 tons of manure. Including the feedlot, it provides 90 jobs in Mead, population 564, illustrating how proponents of biofuels say they can revitalize the economies of rural communities.

The Mead, Nebraska, site was selected due to its existing cattle feedlot, one of the few in the country which already had roofs over the cows and slatted floors for quick collection of manure. The anaerobic digester requires "clean manure" that does not contain dirt, sand or water in order to create biogas.

CEO Dennis Langley said that E³ BioFuels intends to locate more plants in several Midwestern states, and will license the technology for others to use as well. Once it becomes commercially feasible to refine ethanol from plant cellulose, he said, E³ BioFuels will have a ready supply of cellulose already on site in the form of leftover material from the biogas digester unit, increasing the positive energy balance.

The June 29 edition of the Omaha World Hearld quoted Langley as saying that E³ wants to double the size of the Mead plant and develop 15 more plants nationwide in the next five years.

DG&E to expand use of biomass energy

Utility seeks to acquire more renewable energy with latest solicitation

SAN DIEGO, June 12, 2007 – San Diego Gas & Electric (SDG&E) today announced it has signed a supply contract with Envirepel Energy, Inc. for renewable, biomass energy that will be online by October 2007. SDG&E also reported that it has received nearly 5,000 megawatts (MW) of renewable-energy-supply proposals in response to the utility's most recent renewable Request for Offers (RFO) solicitation that ended May 30, 2007.

Every year since 2002, SDG&E has solicited supply bids for renewable power to meet California's mandate of having 20 percent of its energy portfolio come from clean resources such as wind, solar, biomass and geothermal by 2010. Envirepel's agreement is the result of an earlier competitive solicitation. Biomass power results from burning plant-based materials such as wood.

"We are excited about the new renewable energy contract with Envirepel and with the overwhelming response we received for supplying green energy to our grid," said Debra L. Reed, president and chief executive officer for SDG&E. "Developers are signaling their willingness to build these renewable projects. We are committed to providing the transmission pathway necessary to ensure renewable energy from any of the projects developed reaches San Diego."

The nearly 5,000 megawatts proposed in the most recent RFO represents a mixture of renewable energy, including about 2000 MW of wind, 2,700 MW of solar, and 300 MW of geothermal, biomass and landfill gas. Several of the proposals submitted would require the addition of new transmission infrastructure to deliver energy to San Diego customers.

Today, SDG&E is more than half-way toward meeting its 2010 goal with approximately 12 percent of its future energy supply under contract to be delivered from renewable sources.

SDG&E's contract with Envirepel will now be submitted to the CPUC for review and final approval. SDG&E's final selection of the renewable-energy bids will be based on least-cost, best-fit procurement criteria and will be reviewed by the Procurement Review Group, comprised of California Public Utilities Commission (CPUC) staff, consumer advocates and other non-market participants, and an independent evaluator prior to being submitted to the CPUC for final approval.

Microwave Process Converts Waste Materials into Oil and Gas

Global Resource Corporation (GRC) (OTC: GBRC.PK) claims that its HAWK 10 high-frequency microwave recycling process can recover oil and gases from oil shale, residual oil, drill cuttings, tar sands oil, contaminated dredge/sediments, tires and  plastics with significantly greater yields and lower costs than are available utilizing existing known technologies. The patent pending process process is claimed to be "the world's first self- sufficient, environmentally friendly, fuel-generating recycler to reduce waste, cut emissions, and save energy by going green."

In a July 2  press release GRC reported that the results of first round of tests on gasifying bituminous coal indicated that methane, other hydrocarbon gases, liquids in the diesel-heating range, and hydrogen could be extracted from the coal. After processing, what was left behind were activated carbon and coke as a residue, all the products having real market value. A second round of testing has commenced to substantiate original results. If further testing confirms the results, GRC could very well be the first company to gasify coal without contributing a major greenhouse negative effect by not using oxygen in the gasification process.

According to the company:

"The microwaves gasify the materials - a process also known as "cracking the hydrocarbon chain"- and then, typically, convert them into 80 percent light combustible gases, and 20 percent oil. The gas is then recycled in a closed-loop system to fuel the next round of material breakdown, without emitting any harmful waste. There is no CO2 or CO produced in the process because there is no oxidation other than possibly a minuscule amount that may be pre-existing in the material or minerals processed."

"The process uses specific frequencies of microwave radiation to extract oils and alternative petroleum products from secondary raw materials, and is expected to dramatically reduce the cost for oil and gas recovery from a variety of unconventional hydrocarbon resources>"

In May GRC announced that Gershow Recycling, one of the world's largest recyclers, has agreed to buy the first Hawk-10 machine and will use it to process auto shredder residue (ASR). The process reduces auto recycling's costs and environmental hazards by breaking down textiles, foams, plastics, rubber, and light metal content extracted from cars, with its microwave technology. When the ASR is exposed to GRC's  microwave frequencies, it is converted by 43% by-weight into gases and/or diesel fuel and heating oil, making fuel from previously unusable materials. For each ton of steel that is recovered, between 500 - 700 pounds of ASR is produced.The HAWK 10 will allow Gershow to scrap more metal from materials that were difficult to separate in the past, allowing them to reduce waste by 65%. GRC says its Hawk-10 can extract enough oil and gas from the ASR to run the Hawk-10 itself and a number of other machines used by Gershow.

"We expect Gershow Recycling to capture a full return on their investment within one year of use, thanks to HAWK 10's incredible efficiency, and its ability to lower expenses and recover profit," says Frank Pringle, CEO of Global Resource Corp.

A recent article entitled, "Giant microwave turns plastic back to oil," in New Scientists Magazine profiled GRC's technology. According to their article:

"GRC's machine is called the Hawk-10. Its smaller incarnations look just like an industrial microwave with bits of machinery attached to it. Larger versions resemble a concrete mixer."

The Department of Energy issued a report on Wednesday, June 20, 2007, identifying 25 companies that possess unconventional fuel production technologies. The report includes a profile on Global Resource and its energy production technologies.

Canada fuels KEPCO's biomass drive

Timber Trades Journal, 02 July 2007

Japanese energy firm Kansai Electric Power Co (KEPCO) is to ship 300,000 tonnes of wood pellets from Canada over the next five years as part of the company's target to implement Japan's largest biofuel initiative Around 60,000 tonnes of wood pellets will be carried between Canada and KEPCO's Maizuru power plant each year, with haulier NYK Global Bulk Corporation expecting to make eight voyages every 12 months to complete the order. Due to start next year, the importing of wood pellets is part of an overall project by KEPCO to reduce carbon dioxide emissions at the Maizuru facility by 92,000 tonnes a year.

EDF Trading moves into biomass market

EDF Trading, the subsidiary of utility EDF responsible for wholesale market activity, has acquired biomass company Renewable Fuel Supply Limited (RFSL).

RFSL provides a biomass procurement service and logistical and technical support to coal-fired power generation companies that wish to co-fire biomass with coal. It has supplied over 400,000 tonnes of biomass since 2004, according to EDF.

Staff from RFSL who have moved to EDF Trading's London office include Hank Jones, who will lead the biomass business. Jones was a co-founder and director at RFSL and has a wide range of experience in the energy sector, including posts at American Electric Power in London and Duke Energy Resource Corporation in Houston. Other team members include Nick Tsirigotis, Chris Matthews, and Scott Dooley.

"EDF Trading has significant electricity, emissions, coal and freight trading businesses in the physical and financial markets so biomass is complementary to our existing activities," says John Rittenhouse, managing director of EDF Trading. "RFSL's business also has synergies with the EDF Group who are committed to sustainable development and the production of electricity from renewable energy sources," he adds.