October Edition 2008
What is a Smart Grid and why should I care?
High-powered changes in how you get electricity
State approves rate hike for ComEd to begin developing a new system; critics may appeal, saying customers shouldn't have to pay so much
There are problems with having a 19th Century power grid in the 21st Century:
• When an outage occurs, a utility only learns about it if customers call.
• Many customers unintentionally waste electricity on a daily basis because they see their bills only once a month.
The Illinois Commerce Commission took steps Wednesday to remedy these issues, approving a $270 million rate hike for Commonwealth Edison that encourages the utility to begin developing a "smart grid.”
Under the increase, set to take effect September 14, a typical ComEd customer will pay an additional $4.50 in delivery charges each month. The payment will cover maintenance and operations of the existing network, while ComEd studies how to build a more responsive grid and introduce the next generation of electricity meters.
High Powered Changes in How You Get Electricity
Will my next car run on hydrogen?
The car of the perpetual future
Transport: Mass-produced hydrogen fuel-cell cars have been promised for a decade. Where are they?
DURING a keynote address at the Consumer Electronics Show in Las Vegas in January, the boss of General Motors (GM), Rick Wagoner, unveiled the Cadillac Provoq, a new hydrogen fuel-cell concept car. With a drivetrain emitting only water vapor, a 300-mile range and a top speed of 160kph (100mph), the vehicle, said Mr. Wagoner, represented “the promise of truly sustainable transportation”. It was a promise that sounded vaguely familiar.
A decade earlier, in 1998, Mr. Wagoner’s predecessor, Jack Smith, told the Detroit auto show that GM had a plan to produce a production-ready fuel-cell vehicle “by 2004 or sooner”. That same year, Ford’s incoming boss, Jacques Nasser, said that he saw fuel-cell cars as being a viable alternative to petrol cars for many people during the course of his career (he was replaced in 2001). And as recently as 2004 California’s governor, Arnold Schwarzenegger, rhapsodized about “hydrogen highways” all across the state by 2010.
Illinois coal = natural gas
BP Canada and Secure Energy Announce Contracts
St. Louis, MO – BP Canada Energy Marketing Company (BP) and Secure Energy, Incorporated announced today that they have entered into a long term natural gas sales agreement whereby BP will purchase up to 67 million cubic feet of natural gas per day from the Secure Energy Decatur Plant once it has been constructed and becomes operational. Secure Energy will have the option to separately sell natural gas to industrial customers in the Decatur, Illinois area for a portion of its production and BP has agreed to purchase any natural gas not sold locally.
The Decatur plant will convert approximately 1.4 million tons of high-sulfur Illinois coal into over 20 billion cubic feet of natural gas each year. “
Momma, please let your babies grow up to be nuclear engineers
(with apologies to Willie Nelson)
Nuclear industry looking for a wave of new hires
CHAMPAIGN, Ill. (AP) — The man in charge of the country's nuclear regulatory agency says the United States needs a generation of new scientists, engineers and skilled workers to staff, build and monitor what could be dozens new power plants.
The country is on the verge of a building boom for nuclear plants, but after almost three decades of inactivity, it's just starting to train the workers it will need, according to Dale Klein, the chairman of the Nuclear Regulatory Commission.
"We need to increase the talent pool across the board, all the way from Ph.D.s to skilled craft," Klein said in an interview Thursday at the University of Illinois.
September Edition 2008
THE NATURAL Resources Defense Council Action Fund has taken out full-page ads in this newspaper and others to decry offshore drilling for oil as "George W. Bush's Gasoline Price Elixir" that is "100% Snake Oil." The environmental group calls on supporters "to stop the giveaway of our coasts." It is urging visitors to its Web site to send a pre-written letter to their members of Congress that says, "I am not buying the lie . . . that sacrificing the Arctic National Wildlife Refuge and America's coastal waters to oil drilling would make a real difference in gas prices -- either today or twenty years from today!" And the missive adds, "With just three percent of the world's oil reserves, our nation simply doesn't have enough oil to impact the global market or drill our way to lower prices at the pump.
The NRDC's arguments above neatly encapsulate the position taken by environmentalists and other opponents of offshore drilling. And they include a couple of good points. Contrary to the baldly political suggestions regarding lower gasoline prices by President Bush and Sen. John McCain (R-Ariz.), drilling would make no impact on today's pain at the pump because it would be years before any oil flowed from the Outer Continental Shelf. We agree that the Arctic National Wildlife Refuge, with its varied and sensitive ecosystems, should be preserved. In the quest for new sources of energy, there are trade-offs. That pristine area must remain off-limits. But there are three "truths" masquerading as fact among drilling opponents that need to be challenged...
Energy Means Jobs!
Skilled Trades Seek Workers
Contractors, Unions Try Web, Schools; A 'Dirty Jobs' Role
Even as the economy slumps and unemployment rises, strong demand for power plants, oil refineries and export goods has many manufacturers and construction contractors scrambling to find enough skilled workers to plug current and future holes.
With the shortage of welders, pipe fitters and other high-demand workers likely to get worse as more of them reach retirement age, unions, construction contractors and other businesses are trying to figure out how to attract more young people to those fields.
Their challenge: overcoming the perception that blue-collar trades offer less status, money and chance for advancement than white-collar jobs, and that college is the best investment for everyone.
To highlight the benefits of a career in the skilled trades -- and, sometimes, the potential pitfalls of automatically opting for college -- unions and employers are turning to schools, the military, MySpace and even a 46-year-old former opera singer named Mike Rowe.
It is not just a matter of skyrocketing oil prices. The critical challenges of national energy security, the threat of global warming and fading memories of past accidents have mellowed public opposition against a once-scorned form of energy, nuclear power.
The presumptive Republican presidential candidate, John McCain has proposed an aggressive expansion of nuclear power with a proposal of building 45 new nuclear power plants across the country in the next few decades. The presumptive Democratic presidential candidate, Barrack Obama, is in support of nuclear power as long as it was safe and cost effective.
The interest in nuclear generation of electricity is spreading fast, not just here, but globally. In May 2008 Italy announced that within a five-year period it will start an aggressive program of building nuclear power plants. This is a sea change in a country that closed down all its nuclear power plants in the aftermath of the melt down at Chernobyl a few decades ago. Similar discussions are going on across Europe.
August Edition 2008
Alberta surges ahead with climate change action plan
$2 billion invested in carbon capture and storage; $2 billion in public transit
Calgary... The Alberta government is surging ahead on its climate change action plan with two new funds totaling $4 billion to reduce greenhouse gas (GHG) emissions equal to taking more than a million cars off the road each year.
The province will create a $2-billion fund to advance carbon capture and storage (CCS) projects while a second $2-billion fund will propel energy-saving public transit in Alberta.
“We’re tackling both sides of the emissions challenge on behalf of Albertans and all Canadians,” said Premier Ed Stelmach. “We’re reducing the impact of industrial emissions with carbon capture and storage and investing in public transit to reduce the impact from our tailpipes.”
Stelmach said while other jurisdictions talk, his government’s Climate Change Strategy has legislated real targets and real action. “With this announcement we will continue to demonstrate leadership and encourage the federal government and Alberta industries to make real investments in carbon capture and storage.”
Alberta surges ahead with climate change action plan
McCain + Obama = a valid energy plan
For years, Washington has been so feckless in reacting to the energy crisis that it's sometimes hard to believe the nation's elected officials grasp the threat. By importing nearly 60% of the oil we use, we don't just leave ourselves vulnerable to higher prices and lower living standards, we prop up oil-rich nations that include some of our fiercest enemies.
In response, the nation has done almost nothing. Presidents have generally offered up warmed-over and incomplete solutions. Republicans say drill; Democrats say conserve. Congress hasn't done much more than hold hearings that sometimes look like show trials, hoping to score political points.
So it's reassuring that the two presidential candidates appear to take the energy crisis seriously and have ambitious ideas for attacking it. Sen. John McCain calls energy policy "one of (the) great questions" of this campaign, and Sen. Barack Obama says it's "one of the greatest challenges that this generation of Americans will ever face."
If you roll McCain's and Obama's proposals together, though, they add up to a credible energy plan.
Mini Reactors Show Promise for Clean Nuclear Power's Future
If new portable reactors get the green light this month, nuclear energy could be rolled out in the furthest reaches of the United States.
Higher fuel prices and increased carbon emissions have been giving nuclear energy a boost. So far this year, the Nuclear Regulatory Commission has received licensing requests for 19 new nuclear power plants. That number could increase exponentially, along with the number of suitable sites for a plant, if the NRC approves a brand-new design for portable modular units developed at Oregon State University.
Interest in minireactors has grown over the past few years, according to Felix Killar at the Nuclear Energy Institute. “They're simple and robust, with safety features to allow a country without nuclear expertise to gradually put in small plants, and get people trained and familiar with them before moving into more complex plants.” But small-scale plants could prove useful in the United States, too, particularly in areas where residents must now rely on diesel generators for electricity. Toshiba is reportedly working on a small-scale design for Galena, Alaska. But NuScale Power, the startup spun from Oregon State, is the first American company to submit plans to the NRC, which regulates all domestic nuclear power plants….
…NuScale has built and tested a one-third-scale unit that uses electrical heat to simulate a nuclear core. After the design is presented to the NRC on July 24, NuScale will spend the next year and a half testing it. They will then submit a final report to the Nuclear Regulatory Commission, which can spend two or three years reviewing documentation before approval. If all goes according to schedule, Reyes estimates, the minireactors could start to go on line in 2015.
Brownout
What happens when you don't build more power plants? Get ready for spiking electricity rates, brownouts and even blackouts as demand soars
If you think runaway oil prices are upsetting, just wait for what's in store for electricity. Similar forces are in play. Demand is rising fast; supply is not. The cost to get coal and natural gas out of the ground is going up, and to that expense must be added the cost of the carbon permits that Congress and the presidential candidates are contemplating. Environmentalists are getting power plants scotched. China is sucking up energy. Leave such dynamics in play long enough, and price spikes in electricity follow. But that's just the beginning. We may be facing brownouts (voltage reductions) and even rolling blackouts.
By as early as next year our demand for electricity will exceed reliable supply in New England, Texas and the West and, by 2011, in New York and the mid-Atlantic region. A failure of a power plant, or a summer-afternoon surge in the load, could make for a blackout or brownout. "There really isn't any excess in the system," says Rick P. Sergel, chief executive at the North American Electric Reliability Corporation (NERC).
Wind Farms Sprouting Up on Central Illinois Landscape
Three more wind farms - each a utility-scale project with the potential for 100 to 150 towers - are in the works for central Illinois.
Trade Wind Energy, a Kansas-based alternative energy developer, confirmed the company has signed leases with landowners for two wind farms in DeWitt County and is in discussions for a third in Christian County.
The first two sites are east and west of Clinton, about 45 miles northeast of Springfield, and the third is north of Pana, 45 miles southeast of Springfield.
"We are substantially into the leasing process. We already have enough land there for a wind farm," Trade Wind Energy development manager Duane Enger said of the negotiations in DeWitt County.
Enger said lease negotiations have only just begun for the site north of Pana, and that it is too soon to discuss a construction schedule for any of the projects. But he said all eventually would produce 100 to 150 megawatts of electricity.
A megawatt typically would supply 250 to 300 homes, according to industry standards.
Wind Farms Sprouting Up on Central Illinois Landscape
Trying to Build a Greener Britain, Home by Home
When Jeffrey Marchant and his wife, Brenda, power up their computer, turn on a light or put the kettle on to boil, they can just about watch their electric bill rise. A small box hanging on the wall across from the vase of flowers in the front hall of their tidy Victorian home displays a continuous digital readout of their electricity use and tells them immediately how much it will cost, helping them save energy.
Turn on a computer and the device — a type of so-called smart meter — goes from 300 watts to 400 watts. Turn off a light and it goes from 299 to 215. At 500, the meter is set to sound an alarm.
“I’ve become like one of Pavlov’s dogs,” Mrs. Marchant said. “Every time it bleeps I think I’m going to take one of those pans off the stove. I’d do anything to make it stop. It helps you change your habits.”
Through a host of small efforts like this, people like the Marchants have reduced their carbon footprint by half in the last five years and turned Hove — along with neighboring Brighton, with which it shares a local government — from the archetype of a traditional British seaside town into the prototype of a green village. Their efforts are gaining traction here, and recognition around Britain, as a model of easily replicated ways to cut greenhouse gas emissions.
July Edition 2008
For the monthly policy review, I’m going to try and pick out articles that surprised me a bit. As you know there is a lot of coverage of energy issues right now so my job is to highlight a few each month that gives a perspective or tells a story that you didn’t expect. The former head of Greenpeace lobbying for the expansion of nuclear energy is one such piece. Another is the news item that local groups are fighting a solar farm in the desert outside of San Diego because the transmission lines from it will cross pristine areas. This is a perfect example of how every energy solution has some detractors – even alternative energies.
I hope you enjoy this small sampling and please feel free to email suggestions at twolf@ilchamber.org as you see them.
Tom Wolf
THE FUTURE OF ENERGY
Why he says they're wrong to view nuclear energy as 'evil'
By Fareed Zakaria | NEWSWEEK
Apr 21, 2008 Issue
Patrick Moore is a critic of the environmental movement—an unlikely one at that. He was one of the cofounders of Greenpeace, and sailed into the Aleutian Islands on the organization's inaugural mission in 1971, to protest U.S. nuclear tests taking place there. After leading the group for 15 years he left abruptly, and, in a controversial reversal, has become an outspoken advocate of some of the environmental movement's most detested causes, chief among them nuclear energy. NEWSWEEK's Fareed Zakaria spoke to Moore about his sparring with the green movement, and why he thinks nuclear power is the energy of the future. Excerpts:
ZAKARIA: At Greenpeace, you fought against nuclear energy. What changed?
MOORE: My belief, in retrospect, is that because we were so focused on the destructive aspect of nuclear technology and nuclear war, we made the mistake of lumping nuclear energy in with nuclear weapons, as if all things nuclear were evil. And indeed today, Greenpeace still uses the word "evil" to describe nuclear energy. I think that's as big a mistake as if you lumped nuclear medicine in with nuclear weapons. Nuclear medicine uses radioactive isotopes to successfully treat millions of people every year, and those isotopes are all produced in nuclear reactors. That's why I left Greenpeace: I could see that my fellow directors, none of whom had any science education, were starting to deal with issues around chemicals and biology and genetics, which they had no formal training in, and they were taking the organization into what I call "pop environmentalism," which uses sensationalism, misinformation, fear tactics, etc., to deal with people on an emotional level rather than an intellectual level.
Why do you favor nuclear energy over other non-carbon-based sources of energy?
Other than hydroelectric energy—which I also strongly support—nuclear is the only technology besides fossil fuels available as a large-scale continuous power source, and I mean one you can rely on to be running 24 hours a day, seven days a week. Wind and solar energy are intermittent and thus unreliable. How can you run hospitals and factories and schools and even a house on an electricity supply that disappears for three or four days at a time? Wind can play a minor role in reducing the amount of fossil fuels we use, because you can turn the fossil fuels off when the wind is blowing. And solar is completely ridiculous. The cost is so high—California's $3.2 billion in solar subsidies is all just going into Silicon Valley companies and consultants. It's ridiculous.
A number of analyses say that nuclear power isn't cost competitive, and that without government subsidies, there's no real market for it.
That's simply not true. Where the massive government subsidies are is in wind and solar. I know that France, which produces 80 percent of its electricity with nuclear, does not have high energy costs. Sweden, which produces 50 percent of its energy with nuclear and 50 percent with hydro, has very reasonable energy costs. I know that the cost of production of electricity among the 104 nuclear plants operating in the United States is 1.68 cents per kilowatt-hour. That's not including the capital costs, but the cost of production of electricity from nuclear is very low, and competitive with dirty coal. Gas costs three times as much as nuclear, at least. Wind costs five times as much, and solar costs 10 times as much.
What about the issue of nuclear waste?
As is now planned, I'd establish a recycling industry for nuclear fuel, which reduces the amount of waste to less than 10 percent of what it would be without recycling. How many Americans know that 50 percent of the nuclear energy being produced in the U.S. is now coming from dismantled Russian nuclear warheads? The environmental movement is going on about how terrible it will be if someone does something destructive with these materials. Well, actually the opposite is occurring: all over the world, people are using former nuclear-weapons material for peaceful purposes—swords into plowshares. This constant propaganda about the cost of nuclear energy—that's just activists looking for the right buttons to push, and one of the key buttons to push is to make consumers afraid that their electricity prices will go up if nuclear energy is built. In fact, it's natural gas that is causing [energy] prices to go up.
Don't you worry about proliferation?
You do not need a nuclear reactor to make a nuclear weapon. With centrifuge technology, it is far easier, quicker and cheaper to make a nuclear weapon by enriching uranium directly. No nuclear reactor was involved in making the Hiroshima bomb. You'll never change the fact that there are evil people in the world. The most deaths in combat in the last 20 years have not been caused by nuclear weapons or car bombs or rifles or land mines or any of the usual suspects, but the machete. And yet the machete is the most important tool for farmers in the developing world. Hundreds of millions of people use it to clear their land, to cut their firewood and harvest their crops. Banning the machete is not an option.
Are you optimistic that there will be an aggressive move toward nuclear power in the industrial world, and in particular in the United States?
There are 32 nuclear plants on the drawing boards right now. Last year four applied for their licenses and this year we expect 10 or 11 more. That's just in the United States. There are hundreds of nuclear plants on the drawing boards around the world. This is a completely new thing: the term "'nuclear renaissance" didn't exist three years ago, and now it's a widely known term. Unfortunately, the environmental movement now is the primary obstacle here. If it weren't for their opposition to nuclear energy, there would be a lot fewer coal-fired power plants in the United States and other parts of the world today.
Some object to lines through state park
By Elliot Spagat | Associated Press
June 16, 2008
SAN DIEGO — It seems like an idea any environmentalist would embrace: Build one of the world's largest solar power operations in the Southern California desert and surround it with plants that run on wind and underground heat.
Yet San Diego Gas & Electric Co. and its potential partners face fierce opposition because the plan also calls for a 150-mile, high-voltage transmission line that would cut through pristine parkland to reach the nation's eighth-largest city.
The showdown over how to get renewable energy to consumers will likely play out elsewhere around the country as well, as state regulators require electric utilities to rely less on coal and natural gas to fire their plants — the biggest source of carbon dioxide emissions in the U.S.
"This is a classic chicken and the egg," said Mike Niggli, chief operating officer of Sempra Energy's utilities business, which includes SDG&E. "No one can develop a project if they can't send [the electricity] anywhere. You need transmission."
SDG&E's $1.5 billion power line would cut 23 miles through the middle of Anza-Borrego Desert State Park, a spot known for its hiking trails, wildflowers, palm groves, cacti and spectacular mountain views. "This transmission line will cross through some of the most scenic areas of San Diego," said David Hogan of the Center for Biological Diversity. "It would just ruin it with giant, metal industrial power lines."
Environmentalists point to Southern California Edison's ambitious plan for solar panels on Los Angeles-area rooftops as an example of a better approach. Utilities say the roof panels will help but won't produce nearly enough power to satisfy state requirements.
The California Public Utilities Commission is scheduled to vote as soon as August on SDG&E's proposed Sunrise Powerlink, which would carry enough power for about 750,000 homes — or more than half of the utility's customers.
The plan calls for 141 towers through the park at an average height of 130 feet. The entire route would include 554 towers from the wind-swept desert of the Imperial Valley to a site near the Pacific Ocean in San Diego.
May 29th 2008
Painful though it is, this oil shock will eventually spur huge change.
Beware the hunt for scapegoats
In the early 1970s a fourfold rise in the price of oil almost brought the world to a standstill. The shock of the Arab embargo left a deep mark in many countries: America subjected its cars to fuel-efficiency standards, France embraced nuclear power--though sadly SHOENE RUKKU, or "energy-conscious fashion", the inspiration for Japan's fetching short-sleeved business suit, was ahead of its time.
Thirty-five years on, oil prices have quadrupled again, briefly soaring to a peak of just over $135 a barrel. But, so far, this has been a slow-motion oil shock. If the Arab oil-weapon felt like a hammer-blow, this time stagnant oil output and growing emerging-market demand have squeezed the oil market like a vice. For almost five years a growing world shrugged it off. Only now is it recoiling in pain.
This week French fishermen clogged up the port of Dunkirk and British lorry-drivers choked roads into London and Cardiff. Nicolas Sarkozy, France's president, suggested subsidising the worst affected and curbing taxes on petrol; Britain's beleaguered government is being pressed to forgo its tax increases on motorists. In America falling house prices have left consumers resentful--and short of money.
Congress and presidential candidates have been drafting schemes and gas-tax holidays like so many campaign leaflets.
Gordon Brown, Britain's prime minister, thinks the big oil producers can be persuaded to come to the rescue. But only Saudi Arabia shows any enthusiasm for that. Elsewhere, output is growing agonisingly slowly.
That is causing hardship and recrimination. But it could also come to represent an opportunity. The slow-motion shock seems irresistible today, but in time it will give rise to an equally unstoppable and more positive slow-motion reaction.
ACTION REPLAY
It is clear that high oil prices are hurting many economies--especially in the rich world. Goldman Sachs reckons consumers are handing over $1.8 trillion a year to oil producers. The wage-price spiral of the 1970s has been avoided, but the income shock is painful. Beset by scarce credit, falling asset prices and costly food, developed-country households are hardly well-equipped to foot the oil bill. America's emergency tax rebate, voted this year to help people cope with the credit crunch, has in effect been taken right away again.
Stuck for answers, politicians have been looking for scapegoats. Top of the list are the speculators profiting from other people's hardship. Some $260 billion is invested in commodity funds, 20 times the level of 2003. Surely all that hot money has supercharged the demand for oil?
But that is plain wrong. Such speculators do not own real oil. Every barrel they buy in the futures markets they sell back again before the contract ends. That may raise the price of "paper barrels", but not of the black stuff refiners turn into petrol. It is true that high futures prices could lead someone to hoard oil today in the hope of a higher price tomorrow. But inventories are not especially full just now and there are few signs of hoarding.
If the speculators are not to blame, what about the oil companies, which have failed to increase output in spite of record profits?
Profiteering, say some. However, that accusation doesn't stand up to much scrutiny either. The oil price is set in a market. For Shell, Exxon et al to hoard oil underground would be to leave billions of dollars of investment languishing unused. Others fear that oil is pricey because it is running out. But there is little evidence to support the doctrine of "peak oil" in its extreme form. The Middle East still seems to contain a sea of the stuff. Even if new finds elsewhere have been rarer and less accessible than in the past, vast quantities of oil could now be profitably stripped from tar sands and shale.
The truth is more prosaic. Finding and developing new oil fields is an expensive and time-consuming business. The giant new fields in the deep water off Brazil are unlikely to produce oil for a decade or more.
Furthermore, oil is perverse. When prices are low, oil-rich countries welcome the low-cost, high-tech and well-capitalised oil firms. When prices are high, countries like Russia and Venezuela kick them out again. Likewise the engineers, survey ships and seismic rigs that oil firms need to find and produce new deposits are expensive right now.
The costs of finding oil have, temporarily, doubled precisely because everybody wants to give them work.
HOPE AT THE BOTTOM OF THE BARREL
So the oil shock will take time to abate. Some greens may welcome that, seeing three-figure oil as a way of limiting greenhouse emissions.
Conservation will indeed increase. But everything high prices achieve could be done better by sensible carbon taxes. As well as curbing oil use, high prices have put tar sands in business which create far more carbon dioxide than conventional oil. Profits are going to ugly oil-fed regimes, not Western exchequers. And the wild unpredictability of prices will blunt the effect of dear oil on people's behaviour.
From this perspective, governments should speed up the adjustment--or at least stop delaying it. Half the world's people are sheltered from fuel prices by subsidies--which, perversely, have boosted demand and mostly benefited the better off. Now countries like Indonesia, Taiwan and Sri Lanka have begun to realise that they can ill afford this.
Cutting fuel taxes in the rich world makes no sense either (see article[2]). There are better ways to return cash to struggling voters.
The 1970s showed how demand and supply, inelastic in the short run, eventually give rise to conservation and new production. When all those new fields are on-stream, when the SUVs have been sold and the boilers replaced, the downcycle will take hold. By then the slow-motion oil shock could have catalysed momentous change. Right now motorists have no substitute for oil. But it is no coincidence that car companies are suddenly accelerating their plans to sell electric hybrids that are far cheaper to run than petrol or diesel cars at these prices. The first two oil shocks banished oil from power generation. How fitting if the third finished the job and began to free transport from oil's century-long monopoly.
By Mike Riopell, THE SOUTHERN SPRINGFIELD BUREAU
Monday, June 16, 2008 7:42 AM CDT
SPRINGFIELD - Illinois needs a lot of electricity. The state also has a lot of coal to burn.
Nevertheless, building a coal power plant in Illinois has proven difficult over the last several years as increasing pollution controls and ballooning construction budgets have hampered several projects across the state.
In Taylorville, a massive project is on hold awaiting hard-to-find support from state lawmakers.
In Mattoon, the federal government decided to all but scrap an experimental coal plant there that would have pumped pollution underground.
And in Will County, a Joliet-area coal plant has been abandoned.
Those developments continue to frustrate the state's coal industry. Illinois is rich in coal reserves, but the heavy-polluting fuel has fallen out of favor at a time when environmental controls are strict.
The Taylorville and Mattoon projects both sought to burn coal more cleanly, but at least in the case of the proposed Taylorville Energy Center, lawmakers' skepticism of the new technology played at least some role in the project being continuously stalled.
"But you've got to do something," said Senate Minority Leader Frank Watson, R-Greenville. "It's got to go somewhere."
Local projects stalled
"Somewhere" was thought to be east-central Illinois' Mattoon for a while, after the President Bush-inspired FutureGen program was slated to be built there earlier this year. But amid rising construction costs, the federal government pulled its support.
The state coal industry saw the project as a way to start using Illinois' vast amounts of coal, but the project is at least delayed now.
Illinois Coal Association President Phil Gonet said that the industry could stall until FutureGen-style technology - where harmful carbon dioxide is stored underground - is ironed out.
"What's going to happen with carbon capture and storage?" he said.
The $2.5 billion Taylorville Energy Center project proposed by Nebraska-based Tenaska would use different technology but also fit the "clean coal" label. The developers have said they need help from lawmakers to get financing for the massive project.
But after more than a year of asking, they haven't yet succeeded.
Tenaska Vice President Barton Ford said the company previously specialized in plants that make electricity from natural gas, which are "easier to do in general."
Because of the delays, Ford says Tenaska has considered moving the Taylorville project out of Illinois. He said the company originally chose the state because the amount of coal underground would lead to a political atmosphere that would support the project.
"If Illinois isn't willing to do it, who at the state level is going to be willing to do it?" he said.
Illinois Department of Commerce and Economic Opporunity spokeswoman Marcelyn Love said the interest exists. "Illinois has had more genuine interest from clean-coal project developers than any other state," she said.
Besides the Taylorville project, Tenaska company is starting to develop a $3 billion coal plant in Texas. Both have proven complicated, but Ford said the company has focused on coal for a reason. "Because it's the future," he said.
Some successes
Coal is the future for some in Washington County, where a major Peabody Energy Inc. plant is under construction after years of planning. And a smaller-scale coal project is nearing development for Decatur. Secure Energy Inc. is working to build a $550 million plant that converts coal to natural gas for sale.
Lars Scott, founder of the St. Louis-based firm, says the company was formed to focus on coal gasification plants because it's "more straightforward" than trying to develop ones that generate electricity.
The Decatur plant had been under contract to get its coal from a mine in Elkhart. That contract has run out, but could be renewed, Scott said. Secure Energy is trying to get financing now, and could be helped by a $14 million state grant.
"It's not done until it's done," Scott said.
Canadians evenly split on economy versus environment
A majority of Americans said the potential of the Canadian oil sands as a secure, non-foreign source of oil to North America was more important than environmental concerns, while Canadians were evenly split, according to results of a major cross-border survey released by Fleishman-Hillard. However, a high percentage of Canadians (85 per cent) think the oil sands is important to the Canadian economy.
With oil sands development on the rise, FH Canada Research surveyed the attitudes of 500 Canadians and 500 Americans to gauge how people are attempting to reconcile the need for a secure supply of oil against the backdrop of environmental concerns.
The survey shows that nearly half of Americans are aware of the oil sands. Canadians and Americans both see the oil sands as a major secure energy supply. Also, only a slightly higher percentage of Canadians (roughly half) put environmental concerns over secure supply and economic growth issues.
Specifically:
67 percent of Canadians and 47 percent of Americans were somewhat to very aware of the oil sands in Alberta.
When asked if future development of the oil sands was a “good or bad thing,” 75 percent of Canadians and 68 percent of Americans said “a good thing.”
When asked how important the oil sands are to their respective economies, 70 percent of Americans said the sands were important, versus 85 percent of Canadians.
When asked how important the Alberta oil sands are to the overall security of the North American energy supply, 83 percent of Americans versus 73 percent of Canadians said it was important.
Canadian respondents were almost equally divided amongst economic and environmental concerns with 46 percent of Canadians and saying the environment was more important to them while 43 percent of Canadians said secure supply was more important. American respondents put a significantly higher priority on secure supply 55 percent.
Forty percent of Americans said the Alberta oil sands are critical for dealing with the issue of North American dependence on foreign oil. Among Canadians, 26 percent describe the oil sands as necessary to dealing with dependence on foreign oil.
The poll was conducted online between May and June 2008. One thousand people were surveyed, with 500 on each side of the border for a margin of error of 3.1 percent overall, and 4.3 percent for each country’s population. The sample of the survey was representative of the populations of the U.S. and Canada in terms of region, age, language, and gender.
May Edition 2008
Study Suggests Demand for Electric Services Will Top $1 Trillion by 2030; New Power Plants Needed
With power demands expected to increase by 30% between now and 2030, the energy industry claims that significant investment in new generation plants is required in order to keep up with that demand. The Brattle Group for Edison Electric Institute (EEI) released a report earlier this month counters environmental groups arguments that increased energy efficiency measures will mean fewer generation plants and transmission lines are needed.
The report suggests that construction of new and replacement generating plants could cost nearly $600 billion through 2030 and transmission and distribution together could demand nearly $900 billion through that same time period. The Group’s report notes that these estimates are based on current trends and do not account for any significant expansion of energy efficiency programs or new climate initiatives. If aggressive energy efficiency programs are implemented, electricity consumption could decline 7-11% below the 2007 Energy Information Administration baseline figure; however, this decline would not result in a tremendous reduction in the overall generation and transmission investments required by 2030.
The report also notes that costs will continue to increase for the energy industry as climate policies demand clean energy technologies that may not yet be available. The Group highlights carbon dioxide capture and storage systems for coal plants as an example- a technology that is not yet commercially available and alone adds an additional $200 million to generation investment needs.
“Energy Industry Says More Plant Construction Needed”
U.S. Department of Energy Announces Demonstration Grants to Reduce Peak Load Electricity Demand; Illinois Institute of Technology Selected
The U.S. Department of Energy (DOE) announced Monday, April 21 that the Illinois Institute of Technology (ITT) will receive one of nine demonstration grants aimed at improving the efficiency and reliability of the nation’s electricity grid. The $50 million the DOE has set aside represents a five-year investment and is still depends on Congressional approval before the Illinois project can expect to receive its $7 million share. Once that funding has been approved and released, ITT plans to collaborate with Exelon/ComEd, Galvin Electricity Initiative, S&C Electric and others to implement a project that it hopes will achieve “perfect power” at the main campus and prove replicable for municipalities.
Environmental Groups Making Coal-Fired Power Plant Construction More Difficult
In the midst of reports like the one recently released by the Brattle Group calling for increased investment in new electricity generation plants, utilities are facing another battle against crusading environmental groups that are employing whatever tactics necessary to delay or halt new coal plant construction. Environmental groups, such as the Sierra Club, readily admit that with each new coal plant proposed in the U.S. there is a lawyer within their group assigned to stop that plant’s construction. Coal and other energy industry groups, however, are continuing to fight back.
The “anti-coal crusade” does not just stop at the construction of new plants. The group is also picking fights over any generator that uses coal, seeking the denial of permits and ultimately blocking coal utility expansion efforts. Utilities argue that the crusade’s targets are typically without merit, citing a case in Kansas last October of the Sunflower Electric Co. that was denied an air-quality permit for two 700-megawatt generators. The case is still tangled up in a fight between the courts and the Kansas legislature and Sunflower has been unable to proceed with its construction efforts.
Business and utility groups are picking their battles for now, only fighting back in cases that could prove “precedential.” The groups, however, are also continuing to discuss a more comprehensive approach to the environmentalists’ challenges. In the meantime, these groups are urging businesses seeking prospective coal plant construction or generation expansion to ensure that all plans budget for the additional time and legal expenses that are almost guaranteed to plague any proposal.
“Global warming has a new battleground: coal plants”
Proposal Seeks to Improve Ethanol Production Efficiency in Illinois
The Illinois House recently passed legislation that could award ethanol plants up to $4 million to install advanced technologies for water usage, carbon footprint reductions, and other blending improvements designed to optimize processes at the plant. HB 5978, sponsored by Republican Representative Don Moffitt and Democrat Senator John Sullivan is one of a number of proposals that have circulated this session aimed at increasing ethanol production and consumption in Illinois.
One of the major criticisms of ethanol production is that it is a water-intensive process that requires 2 to 3 gallons of water for every gallon of ethanol produced. Environmentalists have started targeting ethanol production plants for this reason, seeking to impose strict regulations on the industry that could ultimately translate into fewer plants being erected.
Environmental groups went after the “stick approach” to this issue this year as, proposing legislation that would have required all ethanol plant permit applications to provide documented water supply, treatment, and discharge plans for the plant’s operations before those permits construction permits would be granted. The proposed measure ultimately failed to clear a House legislative committee.
“Bill Aims to Make Ethanol More Green”
April Edition 2008
Governor Directs EPA to Screen Water for Pharmaceuticals
In direct reaction to a recent Associated Press investigation that found the presence of trace amounts of pharmaceuticals in drinking water in 24 major metropolitan areas throughout the U.S., Governor Blagojevich has ordered the Illinois EPA to begin screening Illinois waterways. The Governor also directed Chicago officials to begin testing the city’s drinking water after the AP reported that Chicago did not test its water supply specifically for the presence of these drugs. Furthermore, state health officials have also been asked to assess the effects of “contaminated” drinking water on human health. The investigation, which took place over five months and examined drinking water supplies in over 60 major metropolitan areas and 52 cities throughout the nation, was not sanctioned by the U.S. EPA.
The trace amounts of pharmaceuticals founds in water supplies results largely from the inability to remove all drug residue from wastewater, despite the numerous treatments the water undergoes before it is piped into taps. While the results of the AP’s investigation have placed a very public spotlight on the issue, experts have stated there is no need for public alarm and drinking water still remains safe. Many cities, including Springfield, Illinois, have already volunteered to implement testing procedures and improve the transparency of these procedures. In the meantime, the pharmaceutical industry launched a new public education initiative with the U.S. Fish and Wildlife Serve to focus on the safe disposal of unused pharmaceuticals.
“More testing needed on drugs in tap water”
“Ill. orders water testing in reax to AP series; providers elsewhere assure supplies are OK”
“Rx lurking in drinking water”
U.S. EPA Tightens Air Quality Standards
Chicago will fail to meet federal smog standards this year after the U.S. EPA recently imposed stricter limits on the allowable level of smog. Although the city met these standards for the first time last year, the EPA’s decision to lower the limit by 10 parts per billion will force the city into violation and also cause the number of counties nationwide in violation of these standards to skyrocket. Business groups strongly opposed the decision, stating that it will create even greater financial burdens on communities that still fail to meet the standards set ten years ago.
Environmentalists, however, are still pushing the U.S. EPA to lower the limit by 25 parts per billion to 60 parts per billion; a standard that businesses and communities alike argue would be impossible for most of the nation to meet for decades to come. According to the EPA, 480 counties nationwide exceed the new 75 parts per billion standard. If that standard were to be lowered to the level recommended by pediatrician groups and environmentalists, the number of counties in violation would nearly double.
“EPA toughens smog limits, but not enough for some advocates”
Suburban County Exploring Innovative Landfill Technology
Will County, one of the fastest growing Illinois suburban counties, is looking towards new technology that may be able to increase the breakdown of trash while generating a potential alternative power source. Last summer, Waste Management Inc., the nation’s largest landfill operator and the current operator of the Will County Prairie View landfill announced it would invest $400 million over five years to employ a bioreactor process that converts methane gas into electricity. The process has already proved successful in states like California, Florida and North Carolina and at least five other landfills in Illinois are currently awaiting state permits to implement a similar process.
The bioreactor process not only provides an alternative, renewable energy source, it also extends the life of landfills significantly. Landfill lifespan is of particular concern to Will County, where the high volume of trash grows as the population of the county continues to explode. Although the process is promising, it is also not without some controversy as it requires the introduction of liquids such as sewage, sludge, and storm water into garbage dumps that are designed to stay dry. These liquids accelerate the decomposition of the garbage, resulting in the increased output of methane, which can then be harnessed to produce electricity for surrounding communities.
“Will County hopes to go from waste to windfall”
U.S. Approves New Canadian Pipeline Serving Illinois Refineries
The U.S. State Department recently gave the ok to TransCanada to begin laying the Keystone gas line that, once completed, will be able to deliver nearly 600,000 barrels of oil a day from Alberta to refineries in Illinois and Oklahoma. The cost of the project, which is estimated at more than $5 billion, is set to begin later this year and is expected to be completed by the end of 2009. Canada has been the largest crude oil supplier to the U.S. for the last four years.
In the meantime, plans to construct another crude oil pipeline that runs from Flanagan, to Patoka, Illinois has been placed on hold after Enbridge Energy Company filed changes to the line plans last month. The company filed notice with the Federal Energy Regulatory Commission in February that is plans to extend the pipeline to refineries on the Gulf Coast; a revelation that was not included in previous filings. As a result, the Illinois Commerce Commission (ICC) filed a petition to postpone plans on the Flanagan-Patoka portion until Enbridge outlines the proposed map for the remainder of the pipeline that would run through southern Illinois. Enbridge cannot begin construction until the ICC certifies the plans and gives the company eminent domain authority.
“U.S. Approves TransCanada’s $5.2B Keystone Gas Line Project”
“Oil pipeline faces more delays”
March Edition 2008
Chamber Continues to Prepare for Energy Tax
Climate change issues are garnering increasing attention within the national public policy arena, but Illinois may soon face a slew of state-only climate change policies that could have devastating ramifications for businesses and the consumer. Governor Blagojevich’s Climate Change Advisory Group- originally formed in 2006- has since prepared a draft final report of recommendations that could form the basis for the Governor’s aggressive climate change policy agenda in 2008. At the center of these recommendations, lies an expensive “cap and trade” tax program that would translate into higher energy prices and loss of even more jobs in Illinois.
A “cap and trade” system, or carbon tax, places a tax on the burning of fossil fuels- coal, gas, and oil- that produce carbon dioxide emissions. Under a traditional “cap and trade” program, the state would place a “cap” on emissions and carbon-emitting companies, specifically utilities, would be required to trade or purchase credits in order to exceed that cap on carbon emissions. Cap and trade programs, such as those already in place for acid rain, typically take several years to establish. The proposal outlined by the advisory group suggests that businesses would be required to pay up front for their carbon emissions in order to generate the revenue necessary to support state budget needs.
The ultimate result of a more than $2 billion carbon tax on businesses would be to place Illinois at an economic disadvantage and drive energy costs for consumers even higher while failing to make any significant reduction in global emissions.
Despite defying the expectation that the Governor would include an energy tax in his State of the State address, we still anticipate environmentalists to pursue this proposal aggressively.
“State Chamber Fears Carbon Tax”
Nuclear Power Giant Calling for National Cap and Trade Program; Wall Street Anticipating Carbon Credit Investment Opportunities
Exelon Corp. CEO, John Rowe, recently spoke out in support of building consensus around climate change policies, specifically calling for a cap and trade system to be implemented at the national level. Legislation proposing a national cap and trade program has been proposed at the federal level and policy experts predict that with the inauguration of a new President in the next year, national climate change standards will be aggressively pursued over the next few years. While businesses within the energy sector, including the Chamber, have traditionally fought state-imposed regulations, these groups have supported efforts at the national and global level. The Chamber has long argued that climate change is an issue that demands national and international response, but that response must be sensitive to the marketplace.
With the prospect of federal climate change legislation and the possibility of a national cap and trade program, Wall Street has also been zeroing in on carbon trading and finance. Peter Fusaro, Chairman of Global Change Associates, was recently quoted as saying, “carbon trading and finance is accelerating in 2008 due to impending climate change legislation moving forward in DDC next year. Investors are now much more engaged on learning about this emerging sector.” In fact, new businesses are emerging in greater numbers to focus on monetizing carbon credits and investors will descend upon New York City April 2nd and 3rd for the Wall Street Green Trading Summit to discuss anticipated changes in the market place for carbon, renewables, and energy efficient technologies.
“Exelon CEO calls for consensus on climate change”
“Carbon, Competition, and Kilowatts”
Illinois Lawmakers Not Giving Up on FutureGen
Illinois rang in the New Year as the winning site for a revolutionary new coal-fired power plant, but that celebration quickly soured after the U.S. Department of Energy announced at the end of January that it was pulling the plug on the FutureGen project. While the feds claimed their decision was based on a budget that had nearly doubled since they first announced funding for the project, many Illinois officials claimed the decision was made out of disappointment that the FutureGen Alliance had selected Illinois over Texas. Regardless of the reasoning behind the Department of Energy’s announcement, the decision shocked and disappointed members of the FutureGen Alliance- a consortium of coal companies and electric utilities- as well as Illinois lawmakers, who are now requesting that President Bush and the U.S. Government Accountability Office (GAO) review the Department’s decision.
“Illinois lawmaker calls for GAO review of FutureGen decision”
Three Illinois Cities Make Top “Green Cities” List
Popular Mechanics recently published their list of 50 of the nation’s “Greenest Cities,” naming Chicago, Springfield, and Joliet the 9th, 29th, and 40th “greenest” cities in the U.S., respectively. The list was based on raw data collected by the U.S. Census Bureau and the National Geographic Society’s Green Guide, with the magazine focusing in on four broad categories, including electricity usage, transportation habits, green living standards, and availability of recycling.
To learn more about the criteria used for compiling the list and to view the full list of cities, please click on the following:
“America’s 50 Greenest Cities”
February Edition 2008
Chamber and Illinois Environmental Regulatory Group (IERG) Host Business Community Meeting on Climate Change
More than 70 individuals representing businesses in sectors ranging from coal, transportation, manufacturing, utilities, and agriculture turned out for a Chamber-IERG hosted event January 16th to discuss the policy implications of the Governor’s Climate Change Advisory Group draft final report. Although the final recommendations have not been publicly circulated, the Chamber’s environmental affiliate, IERG, has obtained a copy of the final draft report and provided an analysis of that report to the attendees. Scott Wiseman, the Vice President of the Midwest Region for the Center for Energy and Economic Development (CEED) also presented to the group on the potential ramifications these recommendations could have on the business community as a whole.
Chamber members, such as Caterpillar and Ford, were invited to participate in the advisory group meetings, but quickly found that the group was heavily weighted in favor of the goals and initiatives of the environmental groups. Recognizing that global warming is likely to emerge as a major policy issue for the Governor in 2008, the Chamber has met with various businesses and associations, such as CEED, in an attempt to unite the business community in its response to the Governor’s targeted climate change policies. January 16th, however, represented the first time such a large cross-representation of businesses impacted by the Governor’s global warming proposals cam together to discuss a coordinated response.
New Law Establishes U.S. Fuel Efficiency Standards
Last month, President Bush took a significant step towards establishing a national policy on global warming and energy efficiency by signing legislation that will require automakers to increase fuel efficiency by 40% to an industry average 35 miles per gallon by 2020. The legislation was the result of extensive bipartisan negotiations that many hope will boost the nation’s energy independence while answering to the trend among states, such as California, New Jersey, and potentially Illinois, to impose a mish mash of environmental regulations on businesses that operate in multiple states. The legislation also bolsters ethanol production, establishes energy efficiency improvements for appliances, and sets new light bulb standards.
To read more about the new law and its impact on the ethanol and automobile industries, please click on the following:
“Bush signs bill boosting car fuel economy”
“Energy bill a boon for ethanol, and a challenge”
“In wake of mileage bill, automakers get creative”
2008 Presidential Candidates on Energy Issues
With Illinois voters headed to the polls a week from today, there has never been a more important time to know where the candidates stand on the issues. While the war in Iraq and health care reform have remained the predominant “hot button” issues for the primary election, the candidates have spoken out, at one time or another, on global warming and energy issues. The following chart is intended to help summarize and compare the energy policies of the major Democratic and Republican contender.
2008 Presidential Candidates on Energy Issues
January Edition 2008
New Laws in 2008
HB 680 Environmental Contaminant Biomonitoring Feasibility Study- authorizes the University of Illinois at Chicago, Great Lakes Center for Occupational and Environmental Safety and Health to conduct an Environmental Contaminant Biomonitoring Feasibility Study that proposes the best way to establish an environmental contaminant biomonitoring program. P.A. 95-0074
HB 894 Electric Service Competition- removes the reciprocity provision from the Electric Service Customer Choice and Rate Relief Law to allow entrance of competition into the State (under a deregulated market). P.A. 95-0130
HB 1425 Radon Awareness Act- creates the Radon Awareness Act providing protections for both the buyer and seller of real estate in regards to radon testing. P.A. 95-0210
HB 1460 Energy Efficiency- requires all buildings owned or leased by the State that are at least 1,000 square feet to use Energy Star labeled light bulbs. P.A. 95-0104
HB 1780 Conservation Activities- authorizes use of state funds for planning, preservation, and water protection and to partner with private landowners, government, and not-for-profit organizations in conservation activities. P.A. 95-0139
HB 3394 Green Cities/Smart Cities Grants- provides that the Department of Commerce and Economic Opportunity may establish and administer a green cities grant program and a smart cities grant program to make grants to municipalities whose buildings conform with nationally recognized and accepted green building guidelines, standards, or systems. P.A. 95-0170
HB 3638 Pollution Control Facilities- provides that a site or facility is not a pollution control facility if it temporarily holds in transit for 10 days or less, non-putruscible solid waste in original containers, no larger in capacity than 500 gallons, provided that such waste is further transferred to a recycling, disposal, treatment, or storage facility on a non-contiguous site and provided such site or facility complies with certain federal requirements. P.A. 95-0177
SB 69 Scrap Metal Records- requires every person licensed as a scrap processor and every recyclable metal dealer to maintain for 3 years, at his or her business, specified records relating to the acquisition of scrap metals having a value of $100 or more. P.A. 95-0253
SB 215 Energy Efficiency Programs- provides that any electric or gas public utility with fewer than 200,000 customers in Illinois on January 1, 2007 that offers energy efficiency programs to its customers in a state adjacent to Illinois may seek the approval of the Illinois Commerce Commission to offer the same or comparable energy efficiency programs to its customers in Illinois. P.A. 95-0660
SB 942 Lead Paint Hazards Reduction- creates the Comprehensive Lead Education, Reduction, and Window Replacement Program to assist residential property owners through loan and grant programs to reduce lead paint hazards through window replacement in pilot area communities. P.A. 95-0492
SB 1041 Compensation for Environmental Damage- amends the Drilling Operations Act to provide that compensation for damage to personal property and loss of a commercial crop caused by drilling are added to the items of reasonable compensation payable to a surface owner that now include damage to growing crops, trees, shrubs, structures, improvements, and livestock. P.A. 95-0493
Laws effective June 1st and July 1st, 2008:
HB 1384 State Facilities Energy Reduction- creates the Agency Energy Efficiency Act to require that all executive branch State agencies strive to reduce energy use in State facilities by 10% within the next 10 years. P.A. 95-0559
SB 649 Biodiesel Labeling Standards- makes changes to labeling standards for MTBE and biodiesel- July 1, 2008. P.A. 95-0381
SB 1241 Mercury Thermostats- provides that beginning July 1, 2008, no person shall install, sell, offer to sell, distribute, or offer to distribute a mercury thermostat in this State (this law became effective in August of 2007, but provisions are not enforceable until July 1, 2008). P.A. 95-0452
December Edition 2007
Governor Blagojevich Signs Off on Midwestern Global Warming Accord
Although Governor Blagojevich’s Climate Change Advisory Group has yet to deliver its own global warming policy recommendations originally promised June 30, the Governor has already joined with 8 other Midwestern Governors in signing off on a regional climate change policy that includes a pledge to provide at least 10 percent renewable electricity generation in their respective regions by 2010 and 20 percent by 2020. The agreement also calls for 2 percent energy efficiency improvement in natural gas and electricity by 2015 and 2 percent annually thereafter; 15 percent of regional retail filling stations offering E85 fuel by 2015 with 33 percent of all stations offering the fuel by 2025; and a regional cap and trade system in place by 2010.
The plan also calls for the region to have at least one commercial advanced coal gasification facility delivering power by 2012. Illinois is currently competing with Texas for the location of the new FutureGen facility, which if awarded to Illinois, would work towards fulfilling this goal. The federal government, however, has yet to determine which state will be awarded FutureGen.
To read more about the Midwestern Governor’s Association global warming platform and related stories, please click on the following links:
“Accord Excludes Nuclear Energy”
“Governors Join in Creating Regional Pacts on Climate Change”
BP Caught in Tedious Balancing Act between Expanding Production while Lowering Emissions
BP’s refinery in Whiting, Indiana is currently the nation’s fourth largest refinery, processing up to 400,000 barrels or more of crude oil a day more than 400,000 barrels of crude oil a day; a figure which will increase by 15 percent when the $3.8 billion expansion project is completed in 2011. BP drew almost immediate scrutiny from environmental groups after it first announced its plan to expand back in July. Since that time, environmental groups have continued to hammer away at the oil refinery’s expansion efforts, despite BP’s attempts to assure these groups that they will also be providing a realistic approach towards reducing emissions. Environmental groups, however, continue to insist that any plans for oil refinery expansions, including regional expansions proposed by ConocoPhillips, Marathon and Murphy, must include significant investment in technology and equipment that will reduce the amount of pollution these groups contend such expansion will create.
The persistence of these environmental groups, however, may make expansion not only difficult, it may result in expansion efforts halting altogether. Fallout from the BP expansion announcement has already sparked speculation that oil prices could be impacted further and the Whiting refinery manager has even gone as far as saying that the expansion project could be canceled if a middle ground is not found. With BP recently announcing its exit from the retail business, resulting in the loss of up to 200 jobs in the Naperville-area, blocking refinery expansion could translate into some very bad economic news for the Chicago region.
To read more about this issue, please click on the following link:
“BP Proposes Lower Air Emissions from Expanded Plant”
Chicago to Pursue Lofty “Green” Goal
Mayor Daley has preliminarily outlined an expansive environmentally-friendly agenda for the City of Chicago that if fully implemented could require an investment of nearly $3 billion. Although Chicago’s plan is not slated for public rollout until early next year, some early details of the proposal include incentives for home owners to reduce their own energy consumption by 30 percent by 2010. One piece of the plan that has become public already involves a partnership with the Clinton Foundation to fund commercial building improvements targeting energy reduction. Former President Bill Clinton’s Foundation provides a private funding mechanism to support the “Clinton Climate Initiative” that assists in partnering building owners with environmental consulting firms that specialize in energy reduction plans.
“Daley Weighs Ambitious Plan to Go ‘Green’”
Resurgence of Coal Power may be Endangered
An article published by the Christian Science Monitor looks at the threats to coal-based energy in the United States, thanks in part to the rising cost of constructing new plants and the threat of stricter emission standards. According to a report by the National Energy Technology Laboratory (NETL), the number of coal-fired power plants awaiting construction fell by 30 in May, only 10 of which were due to the fact that they were actually completed. Coal is considered the cheapest source of energy and with the U.S. growing power needs, the lack of coal-fired power plants across the nation could cripple the nation’s energy-independence, particularly when China and India are constructing these types of power plants at a fever pace.
“Pace of Coal-Power Boom Slackens”
2008 Environmental Workshops for the Construction and Demolition Industry and Building Code Officials
The Department of Commerce and Economic Opportunity, Small Business Environmental Assistance Program along with the Illinois EPA, Department of Public Health, Emergency Management Agency, Department of Natural Resources, and numerous industry co-sponsors will be holding eight workshops around the state in January through March to educate the construction industry and other related industries about requirements for asbestos, lead, radon, mold, floodplains, endangered species and safety and health. In addition, participants will learn about recycling options and energy efficient building.
Workshops will be held from 8:30-4:30 in the following cities on the dates below:
January 16, 2008 Mt. Vernon
January 17, 2008 Collinsville
February 7, 2008 Springfield
February 20, 2008 Joliet
February 26, 2008 Moline
February 27, 2008 East Peoria
March 4, 2008 Downers Grove
March 5, 2008 Arlington Heights
Commercial and Residential Contractors, Demolition Contractors, Realtors, Property Managers, Building Maintenance Providers, Architects, Home Inspectors, Local Building and Zoning Officials and Inspectors are urged to attend.
A $35 nonrefundable fee will be charged to cover meal expenses. Registration and location details may be found here.
November Edition 2007
BP Expansion Flag Emboldens Environmentalists
BP’s oil refinery in Whiting, Indiana made headlines a couple of months ago for obtaining approval from both the Indiana Department of Environmental Management and the federal EPA to increase its capacity in the Great Lakes region; a move characterized by some Illinois officials and environmental groups as an open invitation to increase pollution discharge into Lake Michigan. Although BP has yielded to the protests of Illinois by agreeing to limit its release of pollutants, the fallout from the refinery expansion does not stop at the shores of Lake Michigan.
Environmentalists are now taking other planned oil refinery expansions in the Midwest region to task, including planned oil refinery expansions by ConocoPhillips Company in Roxana, IL, Marathon Oil Corporation’s refineries located in Robinson, IL and Detroit, MI, and Murphy Oil Company in Superior, WI.
These refineries, including the BP refinery, are all seeking to increase their capacity and upgrade equipment in order to be able to process heavy, high-sulfur crude oil from Canada. The move is not only necessary to secure the oil independence of the Midwestern region, but also to meet the growing fuel demands of the nation. The Energy Information Administration, for instance, reported that in early October, the demand for gasoline rose by nearly 80,000 barrels. Environmental groups, however, have a different take on the planned refinery expansions and are hoping to couple plans for increased capacity with requirements to implement pollution-control technology; a move that could halt plans for expansion and increase the price at the pump.
To read more about battle between environmental groups and oil refineries, please click on the following story:
“BP Flap Could Keep Gas Prices High”
The following article also discusses a recent report showing an unexpected dip in oil inventories and how that is impacting petroleum futures:
“Energy Futures Jump After Inventory Report”
Obama Pushes Aggressive Global Warming Agenda; Other Presidential Candidates Varied in Their Approach
Former Vice-President and former candidate for U.S. President, Al Gore, has made a second career out of stirring up national attention on the issue of climate change; a move that has most recently earned him a Nobel Peace Prize. While it is clear where Gore stands on the issue of global warming, no candidate for the 2008 presidential election has elevated the rhetoric on global warming to quite the same level. This is not to say that the candidates have not offered up varied thoughts on how the issue should be addressed. Nevertheless, much of that discussion has been muted by more hot button issues like the war in Iraq and health care.
Illinois Senator Barack Obama, a Democrat contender for president, however, did raise the bar on aggressive approaches to dealing global warming earlier this month. His plan, while following other Democrat candidate’s proposals to reduce greenhouse gas emissions 80 percent below 1990 levels by the year 2050, goes a step further in requiring industries to pay for their quotas to emit greenhouse gases. Obama’s plan would most assuredly prove burdensome for manufacturers, but also, as he readily admits, increase electricity costs for both businesses and consumers.
To read more about where the candidates stand on the issue of global warming, please click on the following story:
“Where the ’08 Contenders Stand on Global Warming”
National Geographic Takes on Climate Change
The October issue of National Geographic devotes most of its issue to global warming, examining the carbon emissions problem from both a scientific and policy view, as well as offering up an interactive look at the cost of alternative energy sources.
To view their article on “Carbon’s New Math” and their interactive cost of biofuel tool, please click on the following links:
Wal-Mart to Push Greener Supply Chain
Wal-Mart recently announced plans to elevate its energy conservation efforts to the next level by partnering with a not-for-profit entity to help measure and manage its greenhouse gas emissions through its supply chain. The Carbon Disclosure Project (CDP), a British-based nonprofit organization that specializes in the implications of climate change on commercial operations and shareholder value, will help Wal-Mart identify opportunities for greener initiatives amongst its sizable global supply chain. The CDP recently released its 2007 report providing an analysis of how 500 of the world’s largest companies are responding to climate change.
To read more about Wal-Mart’s efforts to promote a greener supply chain, as well as the 2007 report released by the CDP, please click on the following links:
“Wal-Mart Offers Road Map for Greener Supply Chain”
“Carbon Disclosure Project Report 2007”
October Edition 2007
Governor’s Advisory Group on Climate Change Poised to Push Aggressive Global Warming Agenda
Governor Blagojevich issued Executive Order No. 11 in 2006 creating the Illinois Climate Change Advisory Group, headed up by the Director of the Illinois Environmental Protection Agency, Doug Scott. While the advisory group consists of representation from business and labor groups, energy and agricultural leaders, scientists, and various environmental groups, the group’s agenda appeared pre-determined from the start with the Governor publicly pushing to adopt many of the aggressive emission standards being pursued by California. Although the group’s full list of recommendations for reducing greenhouse gas emissions is expected to be released next month, several news media outlets reported that the recommendations will include adopting California car emission rules, as well as a cap and trade system for reducing carbon dioxide emissions from coal-burning power plants.
Eleven states have already adopted similar car emission standards with the auto industry fighting implementation of these standards across the board. The auto industry, however, was dealt a serious blow earlier this month after a federal judge in Vermont ruled that states do have the authority to pass emission reduction rules.
To read more about the Governor’s advisory groups upcoming recommendations and the Vermont case, click on the following links:
Indiana BP Oil Refinery Expansion Sparks Controversy in Illinois
The Indiana Department of Environmental Management approved a permit in June that would allow an oil refinery owned by British Petroleum in Whiting, Indiana to reconfigure, ultimately increasing its capacity and expand oil production in the Great Lakes region. The process by which BP followed to obtain their permit followed both state and federal law, not only garnering the approval of the Indiana lead agency on environmental issues, but also the federal EPA. Illinois officials, including US Senator Obama and Chicago Mayor Daley, however, did not characterize the BP permit as an opportunity to enhance commerce for the region, but rather as a move to increase pollution discharge into Lake Michigan. The move prompted an immediate response from Illinois officials at all levels, including Senator Obama, who decried the decision as flying in the face of the federal Clean Water Act and threatened a lawsuit. Although BP has since agreed to limit its release of pollutants, Illinois state officials are still fighting to force a modified permit for BP that will require greater discharge limitations that ultimately go beyond those set forth in law.
To read more about the BP controversy, as well as an analysis of the situation recently published in The Economist, click on the following links:
Federal Clean-Energy Legislation Moves Forward
The US House approved legislation in August that would dramatically change US energy policy by requiring national standards for renewable sources for the first time. Many business groups, including the US Chamber of Commerce, opposed the legislation as it strips away many crucial tax incentives for businesses. The legislation follows a Senate clean-energy bill that passed in June containing provisions to increase the average fuel-efficiency requirements for cars for the first time in 20 years. The Senate’s version of the bill, however, did not include a renewable energy requirement or remove oil industry tax breaks like the House bill.
The Economist Examines the Possible Revival of Nuclear Power
A series of articles published in the September edition of The Economist explore nuclear power and the increased role it could play in pursuing climate change policies. To read these articles, click on the following links:
Increased Ethanol Production Boosts Tensions
The following article examines the mounting tension between grain and food producers and the ethanol/biodiesel industry. Although ethanol production has allowed many small rural Midwestern towns to benefit economically, the increased production has also created a rift in the agricultural community as demands on corn have started to push prices up on food and other grain-dependent commodities.
International Efforts Strive for Cleaner Energy Standards
The following series of articles look at some of the efforts that are occurring on the global level to push for stronger emissions regulation and energy efficiency:
IERG to Host Briefing on The Climate Registry
The Illinois EPA (Ron Burke and Jim Ross) and the Lake Michigan Air Director’s Consortium (Mike Koerber) join IERG in hosting a briefing on The Climate Registry. The briefing will be held Wednesday, October 17, 2007 at 1:00 pm at the Sangamo Club in Springfield, Illinois.
The Climate Registry is a collaboration between states, provinces and tribes aimed at developing and managing a common greenhouse gas emissions reporting system. It is managed by members from 38 states (Illinois EPA Director Doug Scott is Vice Chair), two Canadian provinces and one Mexican state. It is expected to become the standard for tracking GHG emissions in North America. Companies and organizations can join The Climate Registry and start reporting emissions data in January 2008.
The Climate Registry believes that membership affords the following benefits to its member companies:
The briefing on October 17 will be an opportunity to learn more about The Climate Registry and its accounting standards. It will also offer a chance to provide input into the technical framework being drafted.