Hybrid Sales Fall Precipitously as Gas Prices Remain Low
Not surprisingly, as gas prices have fallen in recent months, so have sales of hybrid vehicles. In February, only 15,144 hybrids sold in America, down two-thirds from last April, when sales for that segment peaked (and gas was an average of $3.57 a gallon). While auto sales across the board have fallen dramatically as a result of the economic situation, the drop in hybrids has been even more precipitous.
Two main lessons can be learned from this situation, with the most obvious being that the higher gas costs, the more consumers will purchase efficient vehicles. But the second lesson, which is less apparent, is that as Congress forces automakers to build more alternative fuel cars as a condition of the bailouts, it is putting these companies in a new bind– since consumers don’t want to purchase these efficient vehicles while gas is reasonably cheap.
Apparently, the only entity that is more out-of-touch with the American consumer than the domestic automakers is Congress. By forcing automakers to build efficient cars while gas prices hover around $2, Congress could be setting the stage for another domestic auto industry crash in the coming years.
Of course, this could all be solved by just following the number one lesson above– and dramatically increasing the federal gasoline tax so that consumer (and industry) behavior changes permanently. But Congress, like the automakers, rarely makes the right strategic decision.
UK Looks to Weatherize Every Home by 2030
British Energy and Climate Change minister Ed Miliband proposed a comprehensive scheme to dramatically increase the energy efficiency of all UK homes by 2030. If implemented, the plan could help cut carbon emissions from households by a third by 2020. Heating and powering of households currently accounts for 27% of the UK’s overall carbon emissions. Under a very progressive plan, the UK aims to reduce overall emissions by 80% by 2050.
The weatherization and other efficiency measures proposed on Thursday would retrofit 7 million homes by 2020 and every home by 2030. All households would be eligible to apply for a loan from energy companies, in order to pay for insulation or renewable sources of heating. The loan would be repaid from the resulting energy savings and from cash payments households would receive in return for cutting carbon emissions.
Miliband could just as easily have been describing America’s problem when he stated, “We need to move from incremental steps forward on household energy efficiency to a comprehensive national plan.”
Although the U.S. is increasing its attention on weatherization efforts under Obama, and the stimulus bill does include $5 billion to weatherize modest-income homes, there is no comprehensive plan on the table equivalent to that proposed by the UK.
Google Jumps Into the Smart Meter Industry and Debate
Google has weighed-in on the debate regarding the proposal in the federal stimulus that all smart meters should be required to use open standards and protocols. Not surprisingly, they have come out on the side in-favor of open standards, noting “open protocols and standards should serve as the cornerstone of smart grid projects, to spur innovation, drive competition, and bring more information to consumers as the smart grid evolves.”
Google has an interest in this debate since they are currently developing a free web service called PowerMeter that is a type of smart meter technology that can help consumers track energy use in their house or business. The graphic above illustrates how the service works.
Google notes that the current situation where consumers have no idea how much they are paying for electricity at different times is akin to “stick[ing] to a budget in a store with no prices.” But that with smart meter technology, people “could find all sorts of ways to save energy and lower electricity bills.” Google notes that studies estimate that this price savings could range from 5-15%. However, once smart meter technologies are widely installed, utilities should be able to create tiered pricing based upon supply and demand, thereby further reducing electricity bills, as well as the burden on the entire grid.
List of Top Wind Power States
According to the American Wind Energy Association, as of today, the top five states for wind energy generation are:
1. Texas, 7,116 MW
2. Iowa, 2,790 MW
3. California, 2,517 MW
4. Minnesota, 1,752 MW
5. Washington, 1,375 MW
Report: 2008 Was a Big Year for Wind Energy Growth
The American Wind Energy Association, an industry trade group, released a report this week indicating a record growth in wind energy in 2008, with more than 8,000 MW of new generating capacity having been installed. This increase grew the nation’s total wind power capacity by 50% and actually accounted for about 42% of all new power capacity added to the national grid last year. However, despite this good news, the report also warned that 2009 is set to see a halt in that growth due to the poor economy and credit crisis.
Obama: America will not be held hostage to dwindling resources, hostile regimes and a warming planet
President Obama delivered his expected remarks on energy and climate change today at the White House. As expected, he announced that his administration will grant California a waiver to more strictly regulate vehicle emissions, will have federal agencies increase energy efficiency in federal buildings, and will increase federal fuel efficiency rules. But most importantly, Obama articulated the reasons why we must address these issues and why his strategy will work.
Reviewing the transcript of the speech, here are some of the highlights: READ MORE
Bad PR: Tesla Forces Pre-Ordered Roadster Owners to Pay More
Angering many of their early adopters, Tesla Motors is apparently increasing the price of the Roadster models that are set to go into production. Many of the around 600 pre-ordered owners are incensed that Tesla is raising the price of the Roadster after these owners have already paid up to $50,000 per deposit and thought the deal was done.
While the owners seemed alright with the fourteen month delay in delivery, this public relations nightmare may test that patience. While Tesla claims the increase in price is necessary to become profitable, it is unclear how the pre-ordered owners, who have basically become investors in the company, will view this move. READ MORE
Fearing Energy Dependency, Bulgarians Demand Re-opening of Nuclear Reactors
Highlighting the complex and widespread impacts of the Russian-Ukrainian natural gas dispute, protesters in Bulgaria demanded on Sunday the reopening of two nuclear reactors in that country. The reactors, which are left-over from the Soviet-era, have been shut-down since 2006 as a requisite for gaining entry into the EU.
Now, with natural gas supplies being sharply reduced as a result of the Russia-Ukraine dispute, Bulgarians are demanding more energy independence.
Reuters reports that “About 2,500 protesters with placards reading ‘Speed up Bulgarian energy’ and ‘Restart’ marched through [Bulgaria's capital] Sofia,” and that “Prime Minister Sergei Stanishev said the government would study all the arguments about possibly restarting the units after meeting the organizers.”
Russian-Ukrainian Deal Reached (Again)
The natural gas stand-off between Russia and Ukraine appears to finally have reached a resolution on Sunday. Despite previous reports of settlements, this international dispute has continued for days, including a 12 day shut-off of Russian natural gas deliveries for Europe via Ukraine.
The agreement reached on Sunday was between the Russian and Ukrainian prime ministers, Valdimir Putin and Yulia Tymoshenko. This was of geopolitical significance for Russia, which has been trying to marginalize Ukraine’s pro-western president, Viktor Yushchenko, in favor of Tymoshenko, who is seen as more friendly to Russia.
The deal sets the price of Ukrainian natural gas at around 20% of market prices paid by European customers. This will likely result in a price of between $208 and $240 per 1,000 cubic meters.
Stimulus Package May Extend Wind Energy Tax Credit
It appears that the stimulus package may include an extension of the wind energy tax credit for another three years. The credit will help subsidize new wind farms for their first 10 years of operation. However, since many potential investors do not owe enough in taxes right now to benefit from a tax credit, the bill may provide an alternative form of subsidy– a direct grant to projects for 30% of their cost.
Unfortunately, it appears the stimulus bill will not address the problem of transmission lines– the lynchpin to any national renewable energy transformation.
Utah Exploring Low-Temperature Geothermal Projects
While Utah may be “open for business as it relates to oil shale,” it is also urgently exploring its geothermal options. Looking to take advantage of President-elect Obama’s stimulus package, which requires “shovel ready” projects that can begin within six months, Salt Lake City and the State of Utah are exploring the feasibility of low-temperature geothermal power generation.
Helping them is Raser Technologies, a Utah-based geothermal development company, which will provide research assistance in determining the feasibility of these projects. Raser has a new geothermal plant near Beaver, Utah, as well as eight other projects in development in the Western U.S., and one in Indonesia.
Salt Lake City Mayor Ralph Becker, noted, “With geothermal power, we have an opportunity to bring the environmental and economic benefits of renewable energy directly to the residents of Salt Lake. This effort has the potential to make Salt Lake a national leader in energy independence while utilizing a local renewable energy source that is right here under our feet.”
With Declining Revenues, Venezuela Looks to Bring Back Foreign Companies
With lower oil prices, petro-states have been finding it harder to project their influence across their borders. Venezuela, which has used its excess oil wealth to support a wide-range of social subsidies, including its heating oil program in the U.S., is facing a massive budget crunch due to decreasing oil revenues.
The NYT reported on Wednesday that this decline is due to a combination of factors, including the failure of Venezuela’s national oil company, Petróleos de Venezuela, to produce enough oil for sale and a decline in other sectors of that nation’s economy, due to capital flight stemming from the nationalization of these industries by President Hugo Chavez. READ MORE
Stanford Launches $100 Million Energy Institute
Stanford announced on Monday the creation of a new $100 million energy research institute. The Precourt Institute for Energy will research a wide range of technologies, from solar and wind, to reducing greenhouse gas emissions.
“We need to work on technologies that meet what I call the Tom Friedman test — new technology that meets the China price, that you can sell to China as an alternative to burning coal,” Stanford President John Hennessy said. “That’s the Holy Grail in this, and that’s the kind of problem we want to focus on.”
Lynn Orr, who is the director of the new institute, noted that seed funding to push forward new research and innovation in energy will now be available. “Stanford faculty and students are brimming with ideas that, with some initial support, can be brought to the point that external support can be obtained,” he explained.
Cellulosic Ethanol Test Plant Opens; Future of Ethanol Lies With This Technology
The largest ethanol producer in the world, Poet, has announced the opening of an $8 million cellulosic ethanol plant in Scotland, South Dakota. This biorefinery is a pilot plant that is a precursor to a $200 million commercial-scale plant scheduled to open in 2011 in Iowa.
The Scotland Plant will generate ethanol from plant waste, like corn cobs, that would normally be discarded. Although it currently costs about a $1 more per gallon to make fuel from corn cobs than kernels, Poet aims to eventually make cellulosic ethanol competitive with food-based ethanol.
With heightened criticism being levied upon ethanol lately, it will be important for the industry to produce evidence in the near future that biofuels can actually reduce greenhouse gas emissions, decrease oil consumption, and not materially damage global food supplies. While it remains to be seen if this is possible, cellulosic technologies are likely that industry’s best bet.
In 2007, 75% of Renewable Tax Benefits Went To Corn-Based Ethanol Industry
Generally, the two biggest criticisms of corn-based ethanol have been that it is actually bad for the environment and increases pressure on the world’s food supplies. However, in spite of these facts, U.S. renewable energy policy has been skewed greatly in-favor of ethanol.
Highlighting this fact, Environmental Working Group (EWG) recently released an analysis of U.S. ethanol policy that finds the following incredible conclusions (among others):
- Corn-based ethanol has accounted for fully three-quarters of the tax benefits and two-thirds of all federal subsidies allotted for renewable energy sources in 2007.
