Friday, October 31, 2008

Washington's Cuba time warp gets a jolt

Energy rules. If you don't believe it just look at how the discovery of energy reserves can turn things around so rapidly these days. Geologists suggest that there may be significant oil reserves beneath the waters off the coast of Cuba. Now all of a sudden Washington's abuzz about the possibility of reconsidering the U.S. embargo against Cuba. (GW)

How Cuba's Oil Find Could Change the US Embargo

For decades, the only promise most Cubans saw in the ocean north of their island was the current that carries homemade rafts to Florida. That all changed a few years ago when geologists estimated that between 5 billion bbl. and 10 billion bbl. of oil lie beneath the waters off Cuba's northwest coast. Suddenly it seemed as though the hemisphere's sole communist nation might finally end its desperate dependence on oil-rich allies like the former Soviet Union and Venezuela — and perhaps even escape its impoverished economic time warp altogether.

Washington's own Cuba time warp got a jolt as well. The oil discovery has renewed debate over whether a crude-thirsty U.S. should loosen its 46-year-old trade embargo against Cuba and let yanqui firms join the drilling, which is taking place fewer than 100 miles off U.S. shores. Despite the Bush Administration's hard line on Cuba, Republicans in Congress have proposed legislation to exempt Big Oil from the embargo. That clamor is sure to rise — especially if Barack Obama, who is more open to dialogue with Havana, becomes the next President — now that Cuba's state oil company, Cubapetroleo, or Cupet, has announced a stunning new estimate of more than 20 billion bbl. bubbling off its shores. "This is not a game," Cupet's exploration manager, Rafael Tenreyro, assured reporters in Havana last week.

If true, those potential reserves could make Cuba a major petro player in the hemisphere. (The U.S. has reserves of 29 billion bbl.) And it could render the embargo an even more ineffective means of dislodging the aging Castro brothers, Fidel and current President Raul. "If it really is 20 billion, then it's a game changer," says Jonathan Benjamin-Alvarado, a Cuba oil analyst at the University of Nebraska-Omaha. "It provides a lot more justification for changing elements of the embargo, just as we did when we allowed agricultural and medical sales to Cuba" a decade ago.

But is the Cuban calculation really on the level? Skeptics ask if the 20-billion-bbl. estimate is just a ploy to rekindle investor interest, at a time when falling oil prices could make the maritime find less attractive to the potential international partners Cuba needs to extract the oil. The effort is all the more urgent, they add, because reduced oil revenues could also make friends like left-wing Venezuelan President Hugo Chávez less able to aid Cuba with cut-rate crude shipments and capital to improve the island's aged refineries. "The Cuba numbers from my point of view are not valid," says Jorge Pinon, an energy fellow at the University of Miami and an expert on Cuba's oil business. "I think they're feeling a lot of pressure right now to accelerate the development of their own oil resources." Benjamin-Alvarado gives Cuba's geologists more benefit of the doubt; but he calls the 20-billion-bbl. estimate "off the charts." "I trust them as oil people, and their seismic readings might be right," he says, "but until we see secondary, outside analysis, this is going to be suspect."

The U.S. Geological Survey (USGS), a government agency, made the initial estimate of 5 billion bbl.to 10 billion bbl. for Cuba's northwest offshore sector (known as the Exclusive Economic Zone, or EEZ) in 2004. Tenreyro says Cupet's analysis is based on what he calls a more accurate comparison of similar maritime oil fields like those off Mexico's Gulf Coast. "We're talking about that magnitude," he argued last week. "We have more data" than the USGS. But Cupet, an arm of Cuba's ultra-secret communist government, hasn't offered much more evidence than that. Chris Schenk, who as USGS coordinator in the Caribbean led the 2004 survey, agrees that Cuban geologists "are very good." But he adds, "We would like to see more data." Still, Schenk notes, because of the embargo and Havana's insular information policies, "we can't converse with the Cubans."

The Spanish energy company Repsol-YPF has entered into a production-sharing agreement with Cupet and is scheduled to start drilling the first real well in the EEZ next year. Other international firms, including Norway's StatoilHidro and India's Oil & Natural Gas Corp., are part of the Repsol-led consortium. Venezuela's state-run Petroleos de Venezuela is considered a lesser player because it has little deep-water drilling experience. (China is also interested but so far only involved in onshore drilling in Cuba.) Cuba is now in important negotiations with Brazil's Petrobras, which just made its own multibillion-barrel oil find off its coast near Rio de Janeiro and could, analysts say, be the major offshore drilling partner for Cuba if it jumps in.

Still, the concessions so far represent less than a quarter of the 59 drilling blocks that Cuba hopes to exploit in the 43,000-sq.-mi. (112,000 sq km) EEZ. Analysts say one reason is the daunting infrastructural difficulties facing any company that drills in Cuba: firms have to bring much more of their own capital, equipment, technology and on-the-ground know-how than usual. This year's severe hurricane damage in Cuba has made the situation worse. Canada's Sherritt, in fact, recently dropped out of its four-block contract. "Who else is going to be willing to actually come in and take the risk in Cuba?" says Benjamin-Alvarado. "In terms of proximity and technology, the only people really able to do it to the extent the Cubans need are the Americans."

Cuba now produces about 60,000 barrels of oil per day (BPD) and consumes more than 150,000 BPD. (It also produces natural gas.) Venezuela makes up the difference by shipping almost 100,000 BPD to Cuba. The University of Miami's Pinon says the more serious issue is refining capacity: even if Cuba has only the low estimate of 5 billion bbl. — which could yield more than 300,000 BPD — it needs Venezuela's investment to upgrade refineries like the Soviet-built plant at Cienfuegos. But plummeting crude prices mean that Chávez may have a lot less wealth to spread around for his petro-diplomacy projects. "Like the collapse of the Soviet Union," says Pinon, "this kind of thing has always been Cuba's Achilles' heel."

If Cuba really does have 20 billion bbl. to drill, however, it could more easily find other interested refinery investors, like Brazil. The question is whether the U.S. will want to step off the sidelines and get a piece of the action too. Kirby Jones, head of the U.S.-Cuba Trade Association and an embargo opponent, says Tenreyro's staff has been credible in the past, and he believes the new estimate is probably accurate. "So for the U.S., this becomes an 800-lb. guerrilla knocking on everybody's door," says Jones. "With that much oil, there would be the feeling that there's a real [U.S.] price to be paid for [maintaining] the embargo. It changes Cuba's economic situation drastically and makes the U.S. less relevant."

Perhaps, but in the short run it's more likely to make the U.S. more determined to do its own offshore drilling. Vice President Dick Cheney and other Bush Administration officials point to Cuba's petro fortunes as justification for opening more of America's coastline to oil production. Recent polls in U.S. coastal states like Florida support that idea, despite environmentalist complaints that both U.S. and Cuban offshore rigs will foul the Gulf of Mexico. Meanwhile, embargo proponents on Capitol Hill have sponsored bills that would, among other sanctions, deny visas to the executives of foreign oil companies that drill oil in Cuba. Their reasoning: the more oil wealth Havana gains, the less incentive it has to pursue democratic reform.

That last part may well be true. But at the end of the day, U.S.-Cuba relations continue to exist in a Cold War time warp. As a result, in both Washington and Havana, 20 billion bbl. of oil might not be such a game changer after all.

Thursday, October 30, 2008

"We will all have to change the way we live to some degree."

We are rapidly approaching a point in history (may in fact already be there) when climate change adaptation becomes our major focus. What makes that thought particularly unsettling (to me at least) is the realization that no one can come close to knowing what to prepare for as far as climate change is concerned.

Even if we were able to accurately predict what would happen and where, it is difficult to imagine that we could mobilize society in time to make the meaningful large-scale changes necessary in time.

That is, not without an unprecedented commitment on the part of the world's governments to rapidly and sustainably transform their energy and economic systems -- moves that would greatly expand humanity's menu of options. (GW)

Sea-level rise threat to coast


By Marian Wilkinson and Ben Cubby

The Sydney Morning Herald
October 29, 2008

SYDNEY'S iconic beaches, coastal houses, commercial property and roads will be threatened by rising sea levels by 2050, while the city's temperature is expected to rise by at least 2 degrees, a new scientific study, launched by the Premier, Nathan Rees, reveals.

"Today, the science is in for Sydney," Mr Rees said yesterday as he proclaimed the influence of the climate sceptic and former treasurer Michael Costa at an end in NSW.

"The Costa era of ambiguity around this issue is over. Along with the rest of the NSW public, I recognise that climate change is a reality and that the NSW Government needs to prepare for it," the Premier said. "There is no longer a climate-change sceptic at the centre of government decision-making in this state".

The study commissioned by the NSW Department of Climate Change, and adopted by the Government, was carried out by the University of NSW and uses research from the United Nations' peak scientific body, the Intergovernmental Panel on Climate Change.

It examines the effect of climate change on the greater Sydney metropolitan region from the Central Coast to Wollongong, along with other regions in rural NSW. The full state study is expected to be released in January.

"We've used world's best science to understand what will happen in different parts of this state so we can start planning now for the future," Mr Rees said. "We will all have to change the way we live to some degree."

The study finds that bushfires are likely to be more intense while rainfall may become more erratic, creating water shortages. But while winter rains decline, intense summer rain in parts of Sydney could increase flash flooding.

This, combined with higher temperatures, is expected to put the state's emergency services and health services under stress.

The study has enormous implications for urban planning, building standards and flood-risk mapping as well as agriculture. It finds by 2050 the expected sea level rise is likely to be 40 centimetres, reaching 90 centimetres by 2100. While the figure sounds deceptively small, a one-centimetre sea-level rise can cause erosion effects of up to one metre.

The projections would mean changes to the Sydney coastline, including the harbour, Parramatta River and the Georges River, said Professor Andy Short of the University of Sydney's coastal studies unit.

"Beaches with a low gradient like Narrabeen, Dee Why and Curl Curl are going to be the most heavily affected," he said.

This sea-level rise would also affect river estuaries and bays. As seawater invades estuaries, fish populations are likely to decline and water birds disappear.

A senior scientist with the Department of Climate Change, Peter Smith, told the forum, "Where you've got a hard promenade at beaches like Manly, you can expect a reduction in beach shape and the actual width of the beach. In some cases, beaches will possibly disappear."

The temperature rises, coupled with more erratic rainfall, are expected to hit southern NSW hardest, said Gary Allan, the project leader for climate risk management in the NSW Department of Primary Industries in NSW.

"In the Riverina, we have to consider the possibility of fairly significant change to agricultural practices as we have known them," he said.

Mr Rees said he would strongly support the federal Carbon Pollution Reduction Scheme and bring forward spending on energy efficiency measures to cut greenhouse gas emissions that cause climate change.

He said a proposed $63 million energy efficiency program to help low-income households cut their emissions would start next month in Orange and Bathurst, and move to Sydney early next year.

The plan, which had been flagged by the previous climate minister, Verity Firth, will affect up to 200,000 people including pensioners, public-housing tenants and Aborigines.

Wednesday, October 29, 2008

We need the equivalent of two planets to maintain our lifestyles

In 1980 I purchased a book by William R. Catton, Jr. entitled "Overshoot: The Ecological Basis for Revolutionary Change" that had a profound influence on my worldview. In the book's opening chapter Catton writes:
"Nature is going to require reduction of human dominance over the world ecosystem. The changes this will entail are so revolutionary that we will be almost overwhelmingly tempted instead to prolong and augment our dominance at all costs. And as we shall see the costs will be prodigious...The paramount need of post-exuberant humanity is to remain human in the face of dehumanizing pressures. To do this we must learn somehow to base exuberance of spirit upon something ore lasting than the expansive living that sustained it in the recent past."
Amen. (GW)

Earth on course for eco 'crunch'

BBC News
October 29, 2008

The planet is headed for an ecological "credit crunch", according to a report issued by conservation groups.

The document contends that our demands on natural resources overreach what the Earth can sustain by almost a third.

The Living Planet Report is the work of WWF, the Zoological Society of London and the Global Footprint Network.

It says that more than three quarters of the world's population lives in countries where consumption levels are outstripping environmental renewal.

This makes them "ecological debtors", meaning that they are drawing - and often overdrawing - on the agricultural land, forests, seas and resources of other countries to sustain them.

The map shows hectares' worth consumed in goods and services

The report concludes that the reckless consumption of "natural capital" is endangering the world's future prosperity, with clear economic impacts including high costs for food, water and energy.

"If our demands on the planet continue to increase at the same rate, by the mid-2030s we would need the equivalent of two planets to maintain our lifestyles," said WWF International director-general James Leape.

Dr Dan Barlow, head of policy at the conservation group's Scotland arm, added: "While the media headlines continue to be dominated by the economic turmoil, the world is hurtling further into an ecological credit crunch."

The countries with the biggest impact on the planet are the US and China, together accounting for some 40% of the global footprint.

The report shows the US and United Arab Emirates have the largest ecological footprint per person, while Malawi and Afghanistan have the smallest.


The index tracks population trends in 1,161 populations of 355 mammal species
It shows an average 19% decrease, with the most serious declines in the tropics

In the UK, the "ecological footprint" - the amount of the Earth's land and sea needed to provide the resources we use and absorb our waste - is 5.3 hectares per person.

This is more than twice the 2.1 hectares per person actually available for the global population.

The UK's national ecological footprint is the 15th biggest in the world, and is the same size as that of 33 African countries put together, WWF said.

"The events in the last few months have served to show us how it's foolish in the extreme to live beyond our means," said WWF's international president, Chief Emeka Anyaoku.

"Devastating though the financial credit crunch has been, it's nothing as compared to the ecological recession that we are facing."


The index tracks population trends between 1970 and 2005 in 2,185 populations of 895 bird species
It shows an average 20% decrease, with the most serious declines in the tropics

He said the more than $2 trillion (£1.2 trillion) lost on stocks and shares was dwarfed by the up to $4.5 trillion worth of resources destroyed forever each year.

The report's Living Planet Index, which is an attempt to measure the health of worldwide biodiversity, showed an average decline of about 30% from 1970 to 2005 in 3,309 populations of 1,235 species.

An index for the tropics shows an average 51% decline over the same period in 1,333 populations of 585 species.

A new index for water consumption showed that for countries such as the UK, the average "water footprint" was far greater than people realised, with thousands of litres used to produce goods such as beef, sugar and cotton shirts.

"In Britain, almost two thirds [62%] of the average water footprint comes from use abroad to produce goods we consume," said Mr Leape.

Tuesday, October 28, 2008

"It's (mostly) all about the grid"

The National Academy of Engineering has called it the greatest engineering achievement of the 20th century. Whether you agree with that assessment or not, there's no disputing the fact that the U.S. electric grid is a technical marvel and represents the largest industrial investment in history. It's time to reinvest in the grid.

Modernizing it could achieve a variety of important goals including making it more accommodating to renewable energy technologies and electric vehicles while encouraging energy efficiency and conservation. This has been an ongoing mantra of mine on this blog. More importantly it is an idea supported by people a lot more knowledgeable about these things and one that seems to really be catching on.
So one more time. If we're serious about making serious progress towards sustainable energy independence we should:
  • Set our sights on the U.S. Department of Energy's scenario of producing 20% of the nation's electricity from wind by 2030 (including T. Boone Pickens' plan for developing the wind resources along the Texas-Dakota corridor and the development of our offshore wind resources)
  • Support the development of plug-in hybrid and pure electric vehicles; and
  • "Smarten" the grid. (GW)
The Matrix Overloaded: Clean Energy Will Depend on a New, 'Smart' Grid

By Jeffrey Ball
Wall Street Journal
October 24, 2008

Wind turbines and solar panels have become the icons of renewable energy. But renewable energy is only as effective as the infrastructure that moves it around: the electrical grid.

Cool devices to harness pollution-free energy won't do much to lessen the country's fossil-fuel dependence unless aging and unsophisticated infrastructure is vastly updated to transmit it.

Explore how energy might flow through a modernized electrical grid.

Even at today's levels, renewable energy is straining an electrical grid already showing signs of fragility, as evidenced by the 2003 blackout that turned out the lights from Connecticut to Michigan. In Texas, which has more installed wind-power capacity than any other state, wind turbines sometimes are ordered shut off because the state's electrical lines can't handle the surge of fresh juice. In California, energy from strong solar rays are stranded far from thirsty markets because of a shortage of transmission lines.

The challenge of modernizing the electrical grid to accommodate cleaner energy rivals the monumental task of extending the grid into rural America in the 1930s and building a fleet of new power plants in the wake of World War II.

"We may need to do it again in a different way if we're really going to take advantage of these resources," says Dan Reicher, who directed the Department of Energy's alternative-energy programs in the 1990s and now heads up renewable-energy policy and investment at Google Inc.'s nonprofit foundation, Google.org. Renewable energy, he says, "will indeed remain a boutique industry unless we build out the transmission lines."

Falling oil prices and the financial crisis threaten the renewable-energy effort, too. Still, the long-term push for cleaner energy is likely to continue.

The current electric grid has two basic shortcomings. It's not big enough to accommodate all the new electricity the nation is likely to need in coming decades,regardless of how that electricity is produced. And it's not flexible enough to handle the inconsistencies of renewable energy, which is less steady than the workhorses of coal and natural gas; the wind doesn't always blow, and the sun doesn't always shine.

In other words, it's dumb. It's not sophisticated enough to minimize electricity waste by allowing, for instance, power companies and consumer appliances to communicate about fluctuations in energy supply and demand.

An updated electrical grid is also crucial to realizing a "green" car. Such a car will depend on an improved power network as much as today's cars depend on the ubiquity of gas stations.
[Google's Toyota Prius ] Google

One of Google's Toyota Prius hybrids that's been converted into a "plug-in" version which uses less gas by tapping an outlet to recharge its battery.

The jury's out on what might sit under that car's hood. Some, like Google, foresee "plug-in" hybrid cars, which, unlike today's hybrids, plug in to an outlet for recharging. The vehicles would run on electricity much of the time, using their downsized gasoline-powered engines only when necessary. But the cars would amount to a real environmental win only if their electricity were produced in a way that didn't pollute the atmosphere as much as power plants that burn coal or natural gas.

Others, like Texas billionaire T. Boone Pickens, envision what might be called indirect-electric vehicles. These vehicles would burn natural gas, and a greater percentage of the gas used in the U.S. is produced domestically, compared with oil. To free up the gas for vehicles, the country would have to stop burning it in power plants. Thus, the other part of the oilman's plan: producing much of America's electricity from wind.

Both these visions could be dismissed as shameless self-interest. Google makes software it wants to sell to help run a bigger and more sophisticated electrical grid. Mr. Pickens plans to develop a huge wind farm in Texas to feed the grid. But the two visions expose an often overlooked weakness in the nation's energy system.

The U.S. electricity industry, too, stands to gain from plug-in hybrids, which would represent a big new market. The industry's research arm, the Electric Power Research Institute, says the grid will have to be expanded to handle the energy from renewable sources.

At its current size, the network could accommodate many new plug-in hybrid cars -- but that would require making the grid smarter. The vast network needs new controls that sense and communicate information about energy load and consumption to ensure, for example, that cars are recharged at night, when there's plenty of unused capacity available. Parts of the current grid are over a half century old, predating the personal computer.

"Maybe the biggest technology hurdle we have right now -- it sounds funny -- is the ability to exchange information seamlessly, because there is no common language," says Arshad Mansoor, a vice president at the Electric Power Research Institute.

The grid will become far more complex since so much will depend upon it. Many more varied sources of energy will feed power into it while many more electrical appliances will draw power from it. Tomorrow's car "is less about the vehicle," says Google's Mr. Reicher. "Now it's about the grid."

Monday, October 27, 2008

"We're gonna be left with a big hole in the ground and nothing to show for it"

If you are concerned about climate change there is absolutely nothing worse than coal. Even most environmentalists who share this concern will confess that coal is at the very bottom of their lists of preferred list of energy options -- lower than nukes.

There are many problems with coal beginning with the toll it takes on coal miners, the environment and ultimately the atmosphere. But as bad as traditional coal mining is, it doesn't hold a candle to "Big Coal's" fascination with the relatively new method for scooping coal call called mountaintop removal.

Today wind energy is the only viable renewable energy technology that is economically competitive with coal. It's clear that if we want to stop mountaintop removal, meet current and future energy needs and combat climate change, the nation (and the world) will need to make a major commitment to wind. (GW)

Coal v. wind: Energy fight rages in W. Va.

DOROTHY, W.Va. (AP) — Tacked to the front porch of a cabin atop Kayford Mountain is a sign. "Larry's Place," it reads. "Almost Heaven."

Almost. It takes just five minutes for Larry Gibson to walk past a collection of campers, through the purple-berried pokeweed and the dust-covered trees, to the crumbling overlook he calls Hell's Gate.

It is a window onto a flat and barren pile of rubble, a gray, alien landscape where only machines now move. It's a small example of mountaintop removal mining, he explains. Only 900 acres.

Then he turns away from the Patriot Coal Corp. project and gazes left toward the unbroken green tentacles of the Coal River Mountain.

It is a web of jagged ridges rather than a single peak, some rising more than 3,300 feet. At its base are neighborhoods like picture-perfect Colcord, a few dozen neatly kept homes along trickling Sycamore Creek. Under its canopy are bears and blackberries, white-tailed deer and wild turkey, ginseng and sassafras.

And like so many in southern West Virginia, it is a mountain that could be blown to bits for its coal.

In it, Massey Energy, holder of state permits to blast 6,000 acres, sees the future — and a fortune. With the spot-market price of steam coal at $133 a ton and likely to rise, the mountain is a rich natural resource capable of feeding power plants for 14 years. Massey plans to start work as soon as federal regulators approve.

But Gibson and a growing number of neighbors propose a different future, one in which the mountain survives.

Mine coal the traditional way, they say. Dig tunnels and leave the mountaintop intact for 200 gleaming white windmills. The blades could spin in the industrial-strength wind, generating enough electricity for 150,000 homes and ensuring that West Virginia remains an energy producer long after its fossil fuels are tapped out.

Gibson, whose family has owned land here for 235 years, has spent a third of his life fighting the companies that have redefined strip mining in this part of the country. He sees their mountaintop removal methods as no less than "the genocide of Appalachia," the unnecessary sacrifice of a people, a culture and the hills that bind them.

"This land right here has done as much for the people as their own mother did," says the spry 62-year-old in denim overalls. "My mother give me birth, but this land give me life."

A solar panel powers his phone and lights. Logs feed the potbellied stove.

"I wouldn't put a lump of coal in this daggone place if I was freezin' to death tomorrow," he says. "Coal's something we used in primitive times... We can surely do better."

___

More than 300 million years ago, southern West Virginia was a steamy swamp thick with plants that sank as they died, forming layers of dense, waterlogged peat. As the earth's surface shifted, sand, clay and other minerals landed atop the peat, squeezing it dry and gradually heating it. Over time, every 3 to 7 feet of peat became a foot of coal. When thrusting and folding pushed up the Appalachian Mountains, the coal came with them.

By the mid-1700s, coal's potential had been discovered, and by the middle of the next century, mining was big business. Since record-keeping began in 1836, more than 13 billion tons have been dug from West Virginia alone, and the state remains the nation's second-largest producer behind Wyoming.

Coal is the most reliable and affordable energy source in the United States, with some 52 billion tons of reserves still underground, the West Virginia Coal Association says. That's enough to ensure a long, productive future for the nearly 50,000 people who depend directly and indirectly on the state's 600 mines for work.

But with those reserves becoming harder to reach, companies want faster, cheaper ways to mine multiple seams at once.

In mountaintop removal, forests are clear-cut. Holes are drilled to blast apart the rock, and massive machines, some with buckets big enough to hold 24 compact cars, scoop the coal from the exposed seams.

The rock and dirt left behind, the "spoil," is then dumped — one 240-ton truckload at a time — into adjacent valleys, changing the natural shape of the earth, lowering the height of the mountain and covering streams with so-called "valley fills."

Coal River Mountain Watch, the environmental group that advocates the wind farm, says more Americans are demanding clean energy, so it's the perfect time to consider a more sustainable use for the mountain.

It's also the perfect place: For industrial wind farms, developers seek sites with wind speeds of at least 15.7 mph, the minimum to be labeled Class 4. At its current height, Coal River Mountain catches winds that range from Class 4 to Class 7, with speeds up to and exceeding 19.7 mph.

But the battle is uphill when nearly everyone stands to get rich from the coal.

The companies that own the mountain, mainly Rowland Land Co. and Pocahontas Coal Co., make money leasing it to Virginia-based Massey. Massey makes money selling what it digs. Shareholders make money when Massey's stock price rises. Chief Executive Don Blankenship makes money when shareholders are happy.

And state budget-builders get more than $300 million a year in coal severance taxes. Although it's a fraction of the total $10.4 billion spending plan, the government needs the money.

"So do hookers and so do pimps," grumbles 53-year-old Lorelei Scarbro, who lost her coal miner husband to black lung and whose 10 acres on Rock Creek are threatened by Massey's plan. "That doesn't make it OK. ... It's not OK for us to be sacrificed so the rest of the world can have more energy."

Scarbro is part of an Internet campaign to stop the destruction of Coal River Mountain, a movement that's drawing support from the Sierra Club, the Rainforest Action Network and the National Resources Defense Council, among others.

To lure cameras to the cause, the activists bring in celebrity visitors like singer Kathy Mattea, a West Virginia native, and Big Kenny Alphin, half of the country duo Big & Rich.

But the industry has a campaign and celebrities of its own.

It formed the Friends of Coal, tapping into the enduring fame of former West Virginia and Marshall university football coaches Don Nehlen and Bob Pruett, and sponsoring new faces like competitive bass fisherman Jeremy Starks.

"The fact is that we have a small band of environmental extremists who just want to shut down mining in West Virginia," says Chris Hamilton, senior vice president of the Coal Association.

At Coal River Mountain, he says, "It's hard to tell if this is a proposal aimed at slowing down mining or restricting mining in that area, or if it's a bona fide proposal to build windmills."

West Virginians need not pit one form of energy against another, he argues. The nation needs them all.

At Konnie's Kitchen in Sylvester, a miner's widow and her daughter stiffen at the suggestion surface mining be stopped. Myrtle Lamb, now 81, lives on her husband's pension; daughter Loretta Board is married to a surface miner.

"They gotta work," Board says. "That's their living. You can't take that away from them."

At an adjacent table, 29-year-old miner Eric Bragg has a tattoo on his left biceps: a skull under a hardhat, its crossbones formed by a shovel and pickax.

"It's just trying to put people out of jobs," he says.

In West Virginia's southern coalfields there are generally three kinds of work: mining, logging and minimum-wage. Thinking about global warming is a luxury some can't afford, the notion of windmills laughable.

"That's kind of funny. I never heard that before," says 21-year-old John Sprouse, chuckling and shaking his head in disbelief, unaware of a 22-turbine farm in Tucker County, 250 miles away.

Mountaintop mining may not be pretty, he says, and it may well happen in his own back yard.

"But it's the way of life right now," he says with a shrug, "and I guess that's the way we gotta go."

___

On Coal River Mountain, the question is really about how — not whether — to mine.

Coal rumbles away, all day every day, in trucks on the Coal River Road. It crisscrosses the highway and the Big Coal River on a network of conveyor belts from portals to processing plants. Shiny new pickups and convenience store doors bear Friends of Coal stickers.

And everywhere are the miners in their telltale navy blue, pants and jackets slashed with reflective stripes of lime-green or orange.

Joyce Gunnoe, keeper of a general store in Dry Creek, sees the wind farm advocates as meddling outsiders bent on destroying a way of life. They don't, as she puts it, "have a dog in this fight."

"We work here. We live here. We were born and raised here," she says. "Coal hasn't hurt us. Coal's helped us."

While she acknowledges many locals also want to stop mountaintop mining, she says they're mainly people who are retired or disabled, people who no longer need the work the mines offer.

Yes, she hears the blasting, the equipment, the trucks.

"But the way I see it, those are guys trying to make a living, to keep us here, to keep our schools open."

Even supporters of the wind farm understand that a transition from coal will take time.

"Our politicians have never seen fit to diversify," says Bob Wills, who has lived on a picturesque, 99-acre Rock Creek farm for most of his life. His son, like many young people trying to avoid the mines, took the only path he could find — the one out of state.

"If they do away with the mining, then I don't know what people are going to do," Wills says. "It's a necessary evil, I guess."

Back in the 1970s, the federal government passed laws to control damage from surface mining, and underground mining remained the dominant method of production for many years.

But after Wyoming supplanted Appalachia as the nation's biggest supplier of coal, that began to change. Across the central Appalachian coalfields, operators began to see mountaintop removal as a cheaper way to compete.

The National Mining Association now estimates that between 14 percent and 15 percent of the nation's coal production comes from mountaintop removal mining. In Appalachia, the number of surface mines now exceeds underground operations.

Curtis Moore, who runs Good Samaritan Ministry in Whitesville, tries to describe the results for people who live in New York, Chicago, Atlanta.

"Just remove your skyscrapers. Take it down to ground zero and then see what your city looks like," he says. "They'd be devastated. And that's what it is here with the mountains."

A study by the U.S. Environmental Protection Agency estimated 400,000 acres of forest were wiped out and nearly 724 miles of streams buried between 1985 and 2001 alone. North Carolina-based Appalachian Voices, which maintains the ilovemountains.org Web site, estimates 470 mountains have already been destroyed.

In an e-mail to The Associated Press on Thursday, CEO Don Blankenship insisted Massey mines responsibly, with safety and the environment in mind. Cost, he said, is not the only consideration.

"Most coal mined by surface mining cannot be deep mined," he wrote. "Energy resources would be lost if not surface mined.

"Our company is an energy company," he added. "We produce mostly coal, but also natural gas. If wind farms proved to be economical, we would invest in them. We are studying that possibility, but the answer is not yet clear in West Virginia."

To retired union miner Lloyd Brown of Whitesville, it's this simple: "There's a right way and a wrong way to mine coal. Massey's come in here, and he (Blankenship) has raped the southern part of West Virginia just to get the coal.

"They're taking away the beauty of West Virginia," he says. "This is part of the beauty, our mountains. They say they put them back better than they were. I don't see that."

In theory, coal operators restore the land to its approximate original contour and replant it for future use. Blankenship even suggests "windmills are more practical on mountains after mining than before" because of the access and infrastructure that are created.

But critics say mined ground is an unstable pile of rubble, too shaky and too short — by several hundred feet in the Coal River Mountain scenario — to catch the best winds.

Across Appalachia golf courses, shopping centers, regional jails and factories have been built on one-time mines. Even the FBI complex in Clarksburg was built atop a former strip mine.

But a mountain mined never looks the same.

"I'm not well educated. I don't have a lot of fancy words," says Sam McGee, a former miner who lives on Rock Creek, below Massey's proposed blasting site. "All I can do is speak from the heart and say they're destroying us."

___

Environmental groups aren't banking on Blankenship to drop his plans and embrace the wind farm.

"With the coal companies, there is no compromise," says Rory McIlmoil, an organizer with Coal River Mountain Watch.

Rather, they are hoping that politicians can be persuaded and that a West Virginia lawsuit before the 4th U.S. Circuit Court of Appeals will reshape the situation.

Environmental groups, backed by a 2007 U.S. District Court ruling, argue the Army Corps of Engineers failed to fully consider the environmental damage that would be caused by issuing four valley fill permits to Massey subsidiaries.

The corps, however, contends the regulations the plaintiffs want fall under state mining laws, and rejecting the state-issued permits would have been a de facto veto of its authority.

And that's why C.C. Ballard, with 39 years of experience at Peabody and Patriot mines, thinks nothing will change.

"They're not going to get it stopped. There's no way," says the white-bearded 58-year-old, washing a car at his home in Stickney after finishing a night shift underground.

"They're going to come in here, they're going to take everything that West Virginia's got. We're gonna be left with a big hole in the ground and nothing to show for it."

Last month, Gov. Joe Manchin declined to intervene in the Coal River Mountain dispute, despite mounting pressure that included a demonstration at the Capitol. It would be inappropriate, he said, to rescind the permits granted by state regulators.

"If we can't do it in a more productive manner, it shouldn't be done, I understand that," he says. "And we're looking at that, and I think there are better ways. But just to say we're going to shut it down? We cannot afford in the United States of America to discount any part of our energy portfolio."

At Flint's Hardware in Sylvester, where miners come for uniforms and other supplies, a railroad conductor who hauls coal says it's time Manchin and everyone else realize that coal is a finite resource.

"If they don't do something with wind and water," says Charles Cowley, "we're all going to be with the lights out."

Sunday, October 26, 2008

"Ag is the future"

Did you know that there's an agricultural high school in the heart of urban Chicago? I didn't before I heard this amazingly uplifting story on National Public Radio yesterday. Two thoughts came to mind as the story concluded.

My first thought was that the school sounded like a great deal like a transplanted New Alchemy Institute (where I once worked) -- especially the raising of tilapia and the use of fish waste water to fertilize basil crops.

My second thought was I wish there had been such a school in Cleveland when I was growing up.

The story points out that an curriculum based on agriculture can provide an extremely comprehensive learning experience even for city dwellers and even if students' aspirations are far removed from farming. (GW)

Chicago High School Raises Crops, Career Hopes

Weekend Edition Saturday, October 25, 2008 · On Chicago's southwest side, the intersection of 111th Street and Pulaski Boulevard is just about as urban as bus exhaust. There's a pizza parlor on one corner. Heavy trucks trundle past, carrying heavy things like cars, steel and cement.

But if you listen carefully to the cacophony of car horns and bus splats, you may hear Lucy, chomping on grass like a pig, which she is — a Vietnamese pot-bellied pig of 350 pounds and then some. Lucy is also the resident mascot at the Chicago High School for Agricultural Sciences, a public school and a 72-acre working farm. Its 600 students grow corn, milk cows, farm fish and run a stand where their own apples, pickles and cookies are for sale.

First and last, it is a public high school, with students clustering to gossip and teachers reminding them that they're in class — even when their class is in a barn. They sit on the rails of a corral and gossip about a goat — a real goat — they're worried looks too thin.

Dr. Joan White is the school's teaching veterinarian. Her patients include two horses: Dalia, who has arthritis, and Splash, "who has Wobblers syndrome," White says. "Both of them would have headed somewhere bad, but we use them to teach husbandry, anatomy, teaching basic skills."

Ag High, as it's called, opened in 1985. It's the second agricultural high school in the country — and one of the first steps toward Chicago's long effort to rejuvenate its public schools with innovation and experimentation.

Students must apply to attend, and some travel more than an hour each way each day. They take the full academic load of English, history, science and language classes. But they also spend part of the day in classes and enterprises distinct to Ag High, such as tending the greenhouse, which right now is planted with hundreds of poinsettias. These will bloom in time for the holiday season and will be sold at the school's farm stand.

Students also mind five tanks of tilapia. The fish will be sold to restaurants, and the little flecks of waste that they swirl through their tank is sprinkled on the soil of basil plants. The basil is harvested to make pesto produced by the school and sold at the stand.

Remember when schools used to have bake sales? Junior Krystal Anderson works the farm stand, selling pesto along with "applesauce, butter pickles, salsa, zucchini bread, applesauce cakes and cookies."

Anderson plans to become a food inspector. She says the high school isn't just about growing and baking, but about the business — big business — of real agriculture. She has partnered with her friend, Heather, on their own line of products.

"It's called K&H Goods," Anderson says, "and so ... we decide what are we going to be making, how much we are going to make and what are we going to be selling the product for."

A Working School, A Working Farm

In Richard Johnson's Ag Finance class, students debate as passionately over what to sell at the farm stand as some students argue about rap versus hip-hop:

"Pumpkin pies are filthy. Sweet potato pie, just an idea," says one student.

"I'm tired of eatin' everything zucchini," says another.

Amid these debates about the farm stand and livestock, the voice of principal William Hook over the P.A. system reminds that Ag High is, of course, a working school. Most of his daily announcements — about the homecoming dance, football scores and detention — blaring through the hallways could be transmitted in more traditional schools.

"There will be detention on Saturday starting this week," he says. "You must meet at the barn at 8 a.m. and work for the duration of your detention. Thank you, and have a good day."

Hook thinks the mix — of city and country, academics and enterprise, classroom and street cred (or, in this case, field cred) — strikes a balance in learning. Instead of having students choose between a college track or a vocational track, "We show that you can do both," he says. "You'll have students out sixth period in pre-calculus class, and then in seventh period they're out laying sod. I think that they learn just as much from doing either one of those things. And I think that's one of the things we do really well here: We prepare them for college and we prepare them for the world of work."

'Ag Is The Future'

A group of students who are city kids confessed it had not been their life's ambition to attend an agricultural high school. Several said their parents were eager for them to apply, because the school is academically distinguished. And, it's notably safe: The metal detector at the school entrance didn't seem to be in use.

Ryan Shelton, who hopes to go on to college in New York and become an actor, is one of those students who needed to be won over. He says the school has made him a "more well-rounded person. And when you're in that field of entertainment, one of the things people look at is whether you have that quality, that 'it' factor, diverse."

Dantrell Cotton, a junior, says the school has changed the way he sees the world. "Ag is all around us. It branches off to thousands of occupations," he says. "No matter what happens economically, that's one of the industries that remain the same. And ag is the future. Agriculture is the future."

Some students confide that friends in their urban neighborhoods mock them as "farmers." Those friends don't understand farming as a modern, scientific and cosmopolitan enterprise that teaches improvisation and persistence.

"A lot of people don't understand what we get at this school that nobody else does," says Melissa Nelson, another junior. "Because what other school can you be like, 'Oh, yeah, we were out in the field and then the tractor broke down so we had to walk back'?"

The farm stand has many students with special needs working the shelves and helping customers. The teacher who runs the stand, Richard Johnson, used to have a family lawn mower business. But he was intrigued by education, and when the Chicago Public Schools began to open the door for teachers with professional backgrounds in business, arts or the military, Johnson signed on. He now holds forth in what may be the only Chicago high school with bales of hay. Last week, when a customer wanted to rent some for a Halloween party, a couple of Ag students saw an opportunity.

"So, after they made the deal, the kids called me and said, 'Hey, Mr. Johnson, we got $45. And they'll bring [the bales] back on Wednesday.' Entrepreneurship at its best. Not like working at White Castle," the teacher says. "You have to make decisions. I think the skills we teach, the entrepreneurial skills, they transcend ... agriculture."

By the way, one especially posh local restaurant buys tilapia from Ag High. But the school won't disclose the name. It seems the chef doesn't want customers to know that the fish in their tilapia with smoked mushroom aioli and ginger-flavored vegetables isn't plucked fresh from the Nile but is trucked in — all the way from exotic 111th Street.

Saturday, October 25, 2008

Nuclear frenzy

We've been following this development for some time. The nuclear industry continues to defy the odds in staging a comeback. For years opponents argued that the environmental and economic barriers were too big to overcome. There is still no strategy for dealing with spent radioactive fuel. But Congress has succeeded in introducing enough of subsidies and incentives to entice foreign and domestic investors to approach the Nuclear Regulatory Commission with applications for new plants -- something that hasn't happened since 1973.

What happened to that 1970's refrain: "Just give me the warm power of the sun"?? (GW)

Nuclear Power May Be in Early Stages of a Revival

WASHINGTON — After three decades without starting a single new plant, the American nuclear power industry is getting ready to build again.

When the industry first said several years ago that it would resume building plants, deep skepticism greeted the claim. Not since 1973 had anybody in the United States ordered a nuclear plant that was actually built, and the obstacles to a new generation of plants seemed daunting.

But now, according to the Nuclear Regulatory Commission, 21 companies say they will seek permission to build 34 power plants, from New York to Texas. Factories are springing up in Indiana and Louisiana to build reactor parts. Workers are clearing a site in Georgia to put in reactors. Starting in January, millions of electric customers in Florida will be billed several dollars a month to finance four new reactors.

On Thursday, the French company Areva, the world’s largest builder of nuclear reactors, and Northrop Grumman announced an investment of more than $360 million at a shipyard in Newport News, Va., to build components for seven proposed American reactors, and more for export.

The change of fortune has come so fast that the Nuclear Regulatory Commission, which had almost forgotten how to accept an application, has gone into a frenzy of hiring, bringing on hundreds of new engineers to handle the crush of applications.

Many problems could derail the so-called nuclear revival, and virtually no one believes all 34 proposed plants will be built. It is still unclear how many billions they would cost, whether the expense can be financed in a troubled credit market, and how the cost might compare with other power sources.

But experts who follow the industry expect that at least some of the 34 will be built.

Given rising public concern about global warming and a recent history of reliable operation among nuclear plants, “the climate for introducing new plants is probably the best it’s been since the industry started canceling plants” 30 years ago, said Brian Balogh, a history professor at the University of Virginia. Unlike most types of power generation, nuclear plants do not emit the gases that cause global warming, once they are completed.

In the United States, orders for new reactors essentially ended in October 1973. That was also the month that the Arab oil embargo began, inaugurating an era of economic problems that drove up construction costs and suppressed demand for power. In the end, more than 100 nuclear reactors, some in advanced stages of construction, were canceled, and tens of billions of dollars were squandered.

On top of that, the Three Mile Island accident in 1979 and the Chernobyl explosion in 1986 made nuclear power a hard sell. And cheap turbines were developed to burn natural gas to generate electricity. By the 1990s, even some nuclear plants that had been running for a few years were deemed too costly and were closed.

But nuclear power never went away. The United States has 104 commercial reactors in operation, and the industry has improved their reliability markedly, increasing their output. They generate almost 20 percent of the country’s electric power.

As concerns over global warming and natural gas supplies have worsened, strong support has developed in Congress and some states for new reactors. The governor of Maryland recently cited a “moral imperative” to build plants to counter the threat of climate change. Support for new reactors has long been strong in some localities, particularly those that are candidates for billions of dollars in construction work.

And investment dollars are starting to flow.

“We have a long-term vision,” Anne Lauvergeon, chief executive of Areva, said in an interview here on Thursday, explaining her company’s decision to join forces with Northrop Grumman at Newport News.

To help spur a revival, Congress provided $18.5 billion in loan guarantees in a 2005 energy law, plus operating subsidies similar to those available for solar and wind power, and insurance against regulatory delays.

Little effective political opposition to new reactors has emerged so far. The environmental movement is spending its energy fighting new coal-burning power plants, with considerable effect. While few environmental advocates are enthusiastic about nuclear power, a handful acknowledge it could play a role in countering global warming.

“There is no question that some of the passion of the antinuclear movement has drained away,” said Professor Balogh, who is the author of a 1990 book on opposition to nuclear power.

Worried about its ability to build coal plants, but needing new power plants to meet rising electric demand, the utility industry is determined to move ahead on nuclear power. While most spending so far is on engineering work and environmental studies, physical work is in the early stages, as well.

The Georgia Power Company wants new units adjacent to its two Vogtle reactors, finished in the 1980s, and workers there are tearing down old buildings left over from that construction to make space for new construction.

At the Port of Lake Charles, La., the Shaw Group and Westinghouse Electric, owned by Toshiba, are building a factory bigger than 10 football fields that will make components for new reactors in the United States and around the world. BWX Technologies, a subsidiary of McDermott International, is setting up a plant in Mount Vernon, Ind., to resume manufacturing reactor vessels and other big components. Both companies expect work for years to come.

The industry’s most intractable problem, what to do with spent nuclear fuel, has not been solved. The government was supposed to begin accepting spent fuel for burial in 1998 but now says it will be 2017 at the earliest, and it is not clear that the site under study, Yucca Mountain in Nevada, will win a license.

But companies that want to build say the industry could make do for the next few decades with an above-ground “interim storage” site. That might mean centralized storage in a remote desert facility.

Some skeptics argue that a technology that needs taxpayer help on a large scale should not be built. In fact, construction costs for power plants of all kinds have risen sharply in the last two years, creating special problems for nuclear power, which has more steel and concrete than other plants of equal output. By some estimates costs have more than doubled since 2000.

The critics argue that the same money spent elsewhere — on wind power, or on retrofitting buildings — could create bigger cuts in carbon dioxide output. Joseph J. Romm, an official in the Energy Department during the Clinton administration, pointed to a recent estimate by Florida Power & Light that a new reactor could cost a steep $8,000 for each kilowatt of capacity — enough power to run a window air-conditioner. That is at least double what a coal-burning power plant would cost, and Mr. Romm said that it was only the preconstruction estimate of an industry famous for cost overruns.

He said the plants would be hard to finance. “I just read that McDonald’s was having trouble getting money, and there’s not a lot of risk in building a new McDonald’s,” he said. “Obviously, the risks with a nuclear plant are enormous.”

He predicted a return to the problem of the 1970s — high prices for electricity driving electric demand down so much that plants under construction were no longer needed. Some people say they believe more political opposition will emerge once some of the proposed plants move closer to construction.

At the Union of Concerned Scientists, an advocacy group in Washington that frequently criticizes the nuclear industry, David A. Lochbaum, a nuclear engineer, said it was too soon to say that opposition was weaker now than during construction of the older plants, when grandmothers tried to block bulldozers.

“We’ve got the grandmothers; we just don’t have the bulldozers,” he said. “There’s not the Kodak moment that a lot of these protests need.”

Friday, October 24, 2008

Can banks learn to do the right thing?

We should be very careful when trying to identify what was responsible for triggering the economic turmoil that has plunged the world's financial markets into their current funk -- and determining the appropriate fix.

It would, for instance, be all too easy to point to banks providing mortgage loans to economically disadvantaged prospective homeowners as the primary culprit. That in turn would provide lawmakers with the perfect excuse for making sure that that "mistake" (i.e. lending to the poor) is never repeated. (GW)


What crisis? This is creative destruction


Is this the end of capitalism? No, this is how capitalism works. But we must get smarter at lending to poor people

By Mark Hannam
Prospect Magazine
November 2008

Writing in 1942, Joseph Schumpeter observed that it was in the nature of capitalism to make progress by means of “creative destruction.” There has been much destruction in the financial sector over the past year: of asset prices, of banks and of confidence. It is not yet widely recognised that this has been part of a creative process, but there is good reason to think that it is.

Asset prices were overvalued, banks were poorly managed and confidence turned out to be complacency in disguise. The time was ripe for a Schumpeterian mutation.

Those who were uncomfortable with the success of the financial services industry during its good years are now—predictably—celebrating its demise. They say that the events of the past year have shown what they knew to be true all along: that financial markets need to be more regulated and subjected to greater political control.

But the fact that substantial government action has been required to mitigate the economic consequences of the current financial upheaval does not prove that financial markets should be more heavily regulated, nor that capitalism has failed. Systemic problems have arisen in the financial markets despite the fact that most participants have behaved responsibly.

The problems we see today are not just signs of failure; they are also signs of progress. If capitalism were better understood—as an economic system that makes progress both through innovation and failure—it might be recognised that government action in times of crisis is needed only to ensure that the process of creative destruction starts again sooner rather than later.

The most interesting question that arises from the current mutations is not, “who is to blame?” but “what can we learn?” The answer takes us to the matter of sub-prime lending—that is, the provision of credit to those who are normally excluded from the financial mainstream.

The proximate cause of our present financial problems is the fact that large amounts of money were lent to poor people in America who only had a realistic chance of making repayment if the value of their homes, against which the loans were collateralised, continued to rise indefinitely. What should we learn from this? The quick answers—depending upon one’s political prejudices—are these: either blame the poor for having aspirations beyond their status and the successive US governments who encouraged wider home ownership, especially amongst minority communities; or blame the banks and mortgage brokers who offered cheap credit without due regard to the quality of their collateral—and without due regard to the longer term risks faced by the borrowers.

But there is no reason why people who suffer from financial exclusion should be denied access to credit, since the evidence shows that they are mostly reliable repayers. Where is the evidence? It is in Asia, Africa and South America. It is in eastern Europe, the middle east and the major cities of America and Europe. It is anywhere that the techniques of microcredit have been used to provide individuals, the self-employed and small businesses with access to credit that mainstream banks would not supply.

There are many people who know how to run sub-prime lending businesses successfully. The key is to offer borrowers flexible loan products that take account of their irregular income patterns and their inability to smooth their expenditure patterns over the year. This approach can be applied to big purchases like property; the key is to ensure that the loan product is suitable.

Time spent face-to-face between lender and borrower is crucial to establish the latter’s needs and the amount of credit that they can realistically repay. Sub-prime lending is just like private banking, but for poor people.

In the build up to the current crisis not all lenders were predatory and not all borrowers were fools. But some loans were reckless and others were fraudulent. Some investors took risks that they did not understand. Too few were willing to learn from the evidence of successful microcredit projects all around the world; so now we will all have to learn from the evidence of our mistakes.

We should remind ourselves of Schumpeter’s insight, and that the enormous benefits of product innovation and economic growth come at the cost of periodic bouts of market failure. We should remind ourselves that we can learn from these failures: the quality of decision-making in major banks will be much better over the next five years than it was during the past five years.

Finally we should remind ourselves that sub-prime lending per se is not the problem. Providing credit to the financially excluded is being done responsibly and successfully in many parts of the world today. With around half of the world’s population still “un-banked,” it is more important than ever that banks learn to do this right.

Thursday, October 23, 2008

"Most of our valuable assets are not on the books"

The debate about the true value of what some call "Nature's services" has resurfaced in the midst of the current global financial meltdown. Bucky Fuller would tell anyone who would listen that Nature doesn't give a hoot about dollars, pounds or yen. Gaia's economic system is based on energy and her design strategy is maintaining the conditions necessary for life by expending the least amount of it -- that is, by doing more with less.

As we have seen recently with the price of oil, the value that society assigns to energy is, for the most part, detached from reality. (GW)


Crunch May Spur Rethink of Nature as "Free"

By Reuters

October 21, 2008


Reuters - The worst financial crisis since the 1930s may be a chance to put price tags on nature in a radical economic rethink to protect everything from coral reefs to rainforests, environmental experts say.

Farmers know the value of land from the amount of crops they can produce but large parts of the natural world - such as wetlands that purify water, oceans that produce fish or trees that soak up greenhouse gases - are usually viewed as "free."

"Most of our valuable assets are not on the books," said Robert Costanza, professor of ecological economics at the University of Vermont. "We need to reinvent economics. The financial crisis is an opportunity."

Advocates of "eco-nomics" say that valuing "natural capital" could help protect nature from rising human populations, pollution and climate change that do not figure in conventional measures of wealth such as gross domestic product (GDP) or gross national product (GNP).

"I believe the 21st century will be dominated by the concept of natural capital, just as the 20th was dominated by financial capital," Achim Steiner, head of the U.N. Environment Programme, told Reuters at the International Union for Conservation of Nature congress in Barcelona earlier this month.

"We are reaching a point ... at which the very system that supports us is threatened," he said.

Conventional economists often object it is impossible to value an Andean valley or the Caribbean. "We have struggled with nature-based services: how does a market begin to value them?" Steiner said.

Costanza helped get international debate underway a decade ago with a widely quoted estimate that the value of natural services was $33 trillion a year - almost twice world gross domestic product at the time.

Infinity

Some economists dismissed Costanza's $33 trillion as an overestimate. Others pointed out that no one would be alive without nature, so its value to humans is infinite.

"There is little that can be usefully be done with a serious underestimate of infinity," economist Michael Toman said at the time.

But with the seizure of world money-markets bringing - for some, at least - an opportunity to rethink modern capitalism's basic tenet that greed and self-interest can counterbalance each other, more environmental experts hope to revisit nature's role in producing food, water, fuels, fibres or building materials.

"The financial crisis is just another nail in the coffin" of a system that seeks economic growth while ignoring wider human wellbeing, said Johan Rockstrom, executive director of the Stockholm Environment Institute.

Under standard economics, nations can boost their GDP - briefly - by chopping down all their forests and selling the timber, or by dynamiting coral reefs to catch all the fish. A rethink would stress the value of keeping nature intact.

Rockstrom said bank bailouts totalling hundreds of billions of dollars might "change the mindset of the public ... if we are willing to save investment banks, why not spend a similar amount on saving the planet?" he said.

And there are ever more attempts to mix prices and nature.

The European Union set up a carbon trading market in 2005 to get industries such as steel makers or oil refineries to cut emissions of greenhouse gases, blamed for global warming.

Ecuador has asked rich countries to pay it $350 million a year in exchange for not extracting 1 billion barrels of oil in the Amazon rainforest.

Bhutan

The Himalayan kingdom of Bhutan has shifted from traditional gross national product to a goal of "gross national happiness", which includes respect for nature.

And in U.N. talks on a new climate treaty, more than 190 nations are considering a plan to pay tropical nations billions of dollars a year to leave forests alone to slow deforestation and combat global warming.

"We want to see a shift to valuing ecosystems," Norwegian Environment Minister Erik Solheim said. Oslo has led donor efforts by pledging $500 million a year to tropical nations for abandoning the chainsaw and letting trees stand.

Deforestation accounts for about a fifth of all greenhouse gas emissions by mankind. Trees soak up carbon dioxide, the main greenhouse gas, as they grow, and release it when they rot or are burnt, usually to clear land for farming.

UNEP's Steiner said long-standing objections that it is too hard to value ecosystems were dwindling as economists' ability to assess risks improved.

A report sponsored by the European Commission and Germany in May estimated that humanity was causing 50 billion euros ($67.35 billion) in damage to the planet's land areas every year.

And a 2006 report by former World Bank chief economist Nicholas Stern said that unchecked global warming could cost 5 to 20 percent of world GDP, damaging the economy on the scale of the world wars or the Great Depression.

Steiner said stock market plunges, or a halving of oil prices since peaks of $147 a barrel in July, showed that environmental experts were not the only ones who had trouble valuing assets.

A 2005 Millennium Ecosystem Report also said that natural systems were worth more intact than if converted.

It said a Canadian wetland was worth $6,000 a year per hectare, and just $2,000 if converted to farmland. A hectare of mangrove in Thailand was worth $1,000 a year - producing fish or protecting against coastal erosion - against $200 if uprooted and converted to a shrimp farm.

Costanza, in a letter to the journal Science with a colleague earlier this year, said one way to value nature would be to set up a government-backed system to trade all greenhouse gas emissions and channel the revenues, estimated at $0.9-$3.6 trillion a year, into an "Earth Atmospheric Trust".

If half the cash were shared out, each person on the planet would get $71-$285 a year, a big step towards ending poverty. The rest could go to renewable energy and clean technology.

Wednesday, October 22, 2008

Offshore wind energy on and beyond the horizon

The United States Department of Energy recently released a document that outlines a scenario wherein wind energy meets 20% of the nation's electricity demand by the year 2030. That would mean bringing close to 300,000 megawatts of wind energy online over the next 22 years.

According to the scenario, 54,000 (or roughly 20%) of that total would come from offshore wind resources -- most generated by winds off the Northeast and Mid Atlantic coasts. The U.S. offshore wind energy resource is vast. Its potential for addressing climate change is enormous. While Department of Energy officials feel that the offshore wind goals can be met without major technological breakthroughs, it's clear that constructing wind farms in ocean (and Great Lakes) waters still poses considerable engineering challenges. Hopefully the next Administration will support an R&D budget that will accelerate the deployment wind energy projects off the U.S. coasts.(GW)

Offshore Wind May Power the Future

Not only are offshore winds stronger but landlubbers have fewer objections to turbines almost invisible from the coast


By Emily Waltz

Scientific American Online

October 20, 2008

The waters of the Jersey Shore may soon become home to the nation's first deepwater wind turbines. New Jersey officials recently announced the state would help fund an initiative by Garden State Offshore Energy to build a 350-megawatt wind farm 16 miles (26 kilometers) offshore. The state wants by 2020 many more of these parks, at least 3,000 megawatts worth, or about 13 percent of the state's total electricity needs.

"This is probably the first of many ambitious goals to be set by states," says Greg Watson, a senior advisor on clean energy technology to the governor of Massachusetts. "Three thousand megawatts is significant. With that you're able to offset or even prevent fossil fuel plants from being built."

The federal government is about to open up to wind energy development vast swaths of deep ocean waters, and states and wind park developers are vying to be the first to seize the new frontier. Wind parks in these waters can generate more energy than nearshore and onshore sites, they don't ruin seascape views, and they don't interfere as much with other ocean activities.

New Jersey's plan was prompted, in part, by new federal rules that will greatly expand the territory in which developers can build offshore wind parks. Until now, such projects were only allowed in shallow state waters—those within 3.5 miles (5.6 kilometers) of shore. The new rules would allow them in federal waters, known as the outer continental shelf, which extend to the edge of U.S. territory about 230 miles (200 nautical miles, or 370 kilometers) out. These are the same waters where the hotly debated oil and gas drilling has been proposed, but the sites are unlikely to overlap, say wind developers.

The U.S. Department of the Interior's Minerals Management Service, the federal agency with jurisdiction, plans to finalize the rules by the end of the year. The agency says it will lease plots of the shelf to developers of wind parks and other renewable energy projects, such as ocean current and wave-harvesting technologies. States are chipping in on wind park development projects in the hope that the energy from these complexes will feed into state grids and help meet renewable energy requirements.

Some groups say the rules leave too many barriers for developers to overcome. "Are these waters really open?" asks Sean O'Neill, founder of the Ocean Renewable Energy Coalition. O'Neill says the leases may be prohibitively expensive and the environmental review process too extensive.

Which way the wind blows
But opening up the shelf may be the only way a viable offshore wind industry can develop in this country. Wind projects in state waters are visible from shore and can interfere with shipping routes and recreation. Turbines often have to be smaller and fewer to minimize these impacts, leading to less profitable projects. And prior to the new federal rules, no one knew who was in charge.

These obstacles have delayed, and in some cases nixed, many projects—and so far, not a single offshore wind turbine is operating in the U.S. Organizers of Cape Wind, an offshore wind park to be built more than five miles (eight kilometers) from Cape Cod, Mass., have been battling public opposition and regulatory hurdles for more than seven years.

Leasing the outer continental shelf may solve some of these problems and open a tremendous energy resource. Researchers at the National Renewable Energy Laboratory (NREL) in Golden, Colo., estimate that the wind in this territory could generate nearly 1000 gigawatts—a little more than the current U.S. electrical capacity.

The figure is enticing because nearly 80 percent of the population lives in coastal states. In some of the most densely populated areas, particularly in the Northeast, there is not enough space for large onshore wind farms. Offshore wind parks can get much closer to some of these coastal cities without having to run long transmission lines over rocky terrain and through urban areas. "I think a lot of people would like to bring the energy from wind farms in the Midwest to the cities in the east, but those links aren't easy to make," says Walter Musial, an engineer at NREL.

Europe has far surpassed the U.S. in offshore wind with more than two dozen wind parks in its waters. But nearly all are built within nine miles (14 kilometers) from coastlines—a distance still visible from shore—and in depths less than 60 feet (18 meters). Researchers must tackle some turbine design challenges before wind parks can move into deeper waters.

Building for depth

A common design for shallow depths is a simple pole driven into the seafloor, called a monopile. The deeper the water, however, the longer and more wobbly the pole. Beyond 65—possibly 100—feet (20 to 30 meters) deep, monopiles are no longer suitable. "At some depth you have to switch technologies," Musial says.

Researchers are experimenting with new designs such as underwater tripods and lattice structures called jackets, which provide extra support. Engineers for the Beatrice Wind Farm in the North Sea near Scotland are leading the way with two turbines in water 138 feet (42 meters) deep and more than 15 miles (24 kilometers) from shore. German developer Alpha Ventus plans to build in the next few months a dozen turbines with both tripod and jacket technologies.

Engineers say these designs could hold up in depths of as much as 200 feet (60 meters). To go any deeper, the best option is likely a floating structure similar to that used by the oil industry. Wires would anchor the platforms to the seabed. But unlike an oil platform, the floating wind turbine would have to better restrain the sea's pitch, roll and heaving motions. Commercial development of these structures is likely a decade away, says Musial, although some private developers in Europe say they are working on prototypes.

The depths of the U.S. outer continental shelf vary: Off of California's coast, for example, it gets deep fairly quickly compared with the east coast shelf. To get to a point where turbines are barely visible, wind parks must be built at least 14 or so miles (22.5 kilometers) from shore, says George Hagerman, a marine renewable energy researcher at Virginia Polytechnic Institute.

Offshore costs can be prohibitive, particularly without tax credits and incentives. Turbines and transmission lines are more expensive. Boats have to make long trips to and from the wind park. And some of the equipment to build in deep waters doesn't yet exist. In Europe, an offshore wind park costs nearly twice as much per megawatt as an onshore wind park, according to the European Wind Energy Association in Brussels. The question, says Paolo Berrino at the association, is whether greater wind generation efficiency offshore will outweigh the additional costs.

"Going into deeper water is not something we're comfortable doing yet," says Jim Lanard a spokesperson for Bluewater Wind, a company that has proposed a wind park 13.2 miles (21.2 kilometers) from the Delaware shore that will employ monopiles to depths of about 75 feet (23 meters). "The first offshore wind parks cannot fail because it will send a signal to the industry and the government that [the] U.S. offshore wind industry is not ready for prime time. So we are taking a conservative approach with technologies proven in Europe."