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Why are the government’s energy forecasts so bad?

Predicting the future ain’t easy. But the energy numbers Washington relies on are bizarrely off-base.


In 2009, the federal government’s Energy Information Administration made a forecast for the next two decades: U.S. wind power would grow modestly, reaching 44 gigawatts of generating capacity in 2030, while solar power would remain scarce, inching up to 12 GW.

Just six years later, U.S. wind capacity is already up to 66 GW, and solar has shot up to 21 GW. There's now enough installed wind and solar to power 25 million American homes— more than three times what the EIA expected before President Obama took office.


On Monday the Advanced Energy Economy Institute, a nonprofit promoting alternatives to fossil fuels, released a new report on America’s fast-moving clean energy revolution, documenting how renewable power and energy efficiency have become cost-competitive in the Obama era. But the report can also be read as a damning indictment of America’s official energy information service, the EIA, which has been a consistent source of misinformation for the policymakers, planners and other energy stakeholders who rely on its forecasts.

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Energy-Efficiency Efforts May Not Pay Off

Weatherization and other energy-efficiency efforts may not be worth the cost, according to a new study


By Scott Detrow and ClimateWire | June 24, 2015

In the run-up to the final rollout of its Clean Power Plan, U.S. EPA has consistently promoted energy efficiency efforts as a cheap, easy and financially advantageous way to meet the rule’s ambitious goal of reducing the power sector’s greenhouse gas emissions by 30 percent.

“When you look at energy efficiency, it is the best approach to actually address the challenge of carbon pollution in a way that is tremendously cost-effective,” EPA Administrator Gina McCarthy said in April at a panel hosted by the University of Chicago’s Energy Policy Institute. Efficiency efforts, she said, are “an extreme case of how you can get [to state carbon-reduction goals] at the lowest possible cost.”

In fact, EPA has predicted that efficiency improvements undertaken to meet state-level goals will ultimately lower monthly electricity bills for consumers, by lowering overall demand.

But now a paper released by that same institute appears to poke serious holes in EPA’s arguments. Examining a major Michigan weatherization program, the study found that while upgrades reduced consumption by about 10 to 20 percent, the total energy savings generated over a 16-year window amounted to less than half of the initial weatherization costs.

These savings were also much lower than initial predictions had estimated. And the study also found that, despite the promise of free weatherization upgrades and long-term savings on energy bills, program administrators had a difficult—and costly—experience convincing Michigan homeowners to participate in the program.

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Take it from George Shultz, everyone needs a little insurance

JUNE 24, 2015

Former secretary of state imagines how Reagan would have handled the issue

Shultz advocates an insurance policy

His words offer message to people who doubt climate change


The job title, insurance agent, probably doesn’t come to mind when you think of George P. Shultz.

Shultz is the academic and economist who advised presidents dating back to Eisenhower and served in four Cabinet-level posts.

As Ronald Reagan’s secretary of state, he helped bring about the end of the Cold War. As he testified in explosive congressional hearings in 1987, he argued against the dirty deal by which the Reagan administration supplied arms to Iran in exchange for hostages, with the profits used to fund an illegal war in Central America.

At 94, Shultz, a fellow at the Hoover Institution, is sounding the alarm on climate change. Earlier this week, the elder statesman came to the Capitol to witness the unveiling of a bronze statue of Gov. Reagan, and tell a few tales about President Reagan.

Afterward, he sat in a small Capitol office and answered my question: What would President Reagan have done about climate change? His response is relevant to deniers, doubters and politicians who would toss snowballs across the U.S. Senate chambers and claim that climate change is fiction.

“I’ll tell a story about it,” Shultz said.

In the mid-1980s, some scientists became convinced that the Earth’s protective ozone layer had become depleted. Other scientists had their doubts. They all understood that if the ozone disappeared, the implications would be catastrophic. There’d be global warming, crop damage and disease.

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Public Investment in Clean Energy ‘Poised for Exponential Growth’


A push to allow MLPs for renewables could add hundreds of billions in investment.

Katherine Tweed
June 25, 2015

A bill that would allow clean energy projects to leverage master limited partnerships, which are used by the oil and gas industry, was reintroduced in the Senate on Wednesday.

“Congress should level the playing field and give all sources of domestic energy -- renewable and non-renewable alike -- a fair shot at success in the marketplace,” Senator Chris Coons (D-DE), sponsor of the bipartisan bill, said in a statement. “This practical, market-driven solution will unleash private capital and create jobs.”

The current MLP market is worth more than $460 billion, according to investment firm CBRE Clarion Securities.

But even without access to MLPs, which are publicly traded entities that are allowed to act like traditional corporations in the eyes of the Internal Revenue Service, other financing vehicles for clean energy projects are already being unleashed. Investment in clean energy hit nearly $340 billion in 2014. Another $5 trillion is expected by 2030.

The investment in green bonds has quadrupled in just two years, from less than $20 billion in 2013 to an expected $80 billion this year, Bloomberg New Energy Finance (BNEF) Chairman Michael Liebreich said at the Renewable Energy Finance Forum in New York City on Wednesday.

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Key group spurns San Onofre deal

'Now the commission needs to decide what to do with this stinking mess'

By Jeff McDonald1:48 P.M.JUNE 24, 2015

The San Francisco consumer group that brokered the $4.7 billion deal dividing costs for the shutdown of the failed San Onofre nuclear plant said Wednesday that it no longer supports the agreement and called on state regulators to reopen talks.

In a five-page motion submitted to the California Public Utilities Commission, The Utility Reform Network said recent revelations of backchannel communications between regulators and utility executives forced the organization to rethink its position.

The group hopes for a better deal for Southern California Edison and San Diego Gas & Electric ratepayers who were assigned to cover $3.3 billion of the shutdown costs, or 70 percent, even though Edison installed the faulty replacement steam generators that caused the January 2012 shutdown.

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After Elk River Spill, Congress Will Vote on Bill Regulating Toxic Chemicals




The Kanawha River in Belle, W.Va. Upriver is a petrochemical plant and opposite a coal power plant. A chemical spill nearby prompted legislative action.


Stacy Kranitz for The New York Times

CHARLESTON, W.Va. — James Lewis still remembers the licorice smell of the water and how his skin itched when he showered.

After 7,500 gallons of a coal processing chemical leaked into the Elk River in January 2014, Mr. Lewis was one of 300,000 people in the Charleston area who were ordered to stop using tap water for several days. But like many people, Mr. Lewis, a construction worker and former chemical plant employee, and his girlfriend, a nurse, spent hundreds of dollars so they could use bottled water for several more months, just to be safe.

“We were worried to death about our children,” Mr. Lewis said. He would like to see the government implement regulations that would prevent disasters like the Elk River spill, he said, but nothing that would harm the chemical companies that are central to the economy here. “It’s a Catch-22,” he said.

    On Tuesday, the United States House of Representatives is scheduled to vote on a bill, prompted in part by the 2014 spill, that would update the Toxic Substances Control Act, a 39-year-old law governing the use of toxic chemicals in industry. The Senate is expected to vote on a similar bill next month, and the measure, which has bipartisan support, could reach President Obama’s desk before the end of the summer.

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    New safety rules for South Texas pipeline inspectors mandate “buddy system,” quicker gun licenses

    Posted on June 24, 2015 | By Rhiannon Meyers

    The Texas Railroad Commission rolled out new security measures to protect its employees patrolling South Texas’ energy infrastructure after they voiced concerns about their safety, the state’s oil and gas regulator said.

    The policy changes follow complaints by Commission Chairman David Porter that the federal government had failed to protect pipeline rights-of-way from becoming pathways for illegal immigration and cartel activity.

    Porter visited pipeline easements and oil and gas facilities along the Texas-Mexico border, and said in a statement that the region poses potential threats for agency inspectors.

    The new guidelines require inspectors to use a “buddy system” when working in potentially dangerous areas and authorizes the purchase of satellite phones for vehicles traversing remote regions near the border with limited cellphone access. Porter said the commission also plans to ensure that staff and inspectors can obtain a concealed carry license in a timely manner if they want to tote a handgun while on duty.

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    Anheuser-Busch spending $20M to make Van Nuys brewery more water efficient

    By Gregory J. Wilcox, Los Angeles Daily News

    POSTED: 06/24/15, 8:26 PM PDT |

    The Anheuser-Busch brewery in Van Nuys will soon be tapping less water to brew its beer.

    The St. Louis-based company said it is investing $20 million to make the facility more water efficient, as the region struggles with a persistent drought.

    Among the improvements will be new meters to better track and measure water use and equipment to reduce the amount of water utilized in the beer packaging process, including rinsing out cans before they are filled.

    The move is a good deal for the Valley, said Economist William W. Roberts, director of the San Fernando Valley Economic Research Center at California State University, Northridge, because as the work starts, it means jobs for the local building sector.

    “This will be a really large construction job for one of the largest employers in the Valley, so across the board this is a good thing. It’s definitely middle-class incomes,” Roberts said of the improvements.

    The company announced the plan on Tuesday as part of a plan to spend more than $1.5 billion on U.S. operations by 2018.

    “We are always asking ourselves how we can do our jobs better, and these investments reflect our efforts to be water and energy-efficiency leaders in the state of California,” Luis Cayo, general manager of Anheuser-Busch Los Angeles, said in a statement.

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    Buying a car could soon be a thing of the past, and Ford is desperate to find what’s next

    By Drew Harwell June 24 at 12:08 PM


    Night falls on automobile nation. (Nikki Kahn / Washington Post)

    Ford last month sent letters to 14,000 of its American drivers with an unusual suggestion: For extra cash, they could rent their cars to fellow urbanites wanting a cheap ride.

    America's second-biggest auto giant wouldn't directly sell any additional cars or trucks off the arrangement; it wouldn't even take a cut. But it would put Ford closer to the front of a movement in which cars are shared, ignored or Uber-ed — not bought.

    The "peer-to-peer" rental experiment is only the latest weird move for America's auto powerhouse, maker of the F-150 and Model T. Last month, Ford launched a pay-as-you-go network of shareable, on-demand cars in London, called GoDrive.

    And on Tuesday, the car giant introduced a new foldable, battery-powered "e-bike," the MoDe:Flex, with companion smartphone and Android smartwatch apps that alert cyclists to weather, directions and even upcoming potholes.


    Ford's new "smart" e-bike, the MoDe:Flex. (Courtesy of Ford)

    Call it a late-life identity crisis. Ford and other carmakers, the chief benefactors of America's auto addiction, are suddenly facing a future in which car buying is a thing of the past. That future, of course, could still be far off: U.S. auto sales are running at a rate that could hit 17 million new cars this year, a 14-year high.

    But in the meantime, car-sharing and taxi services like Lyft, Uber and Zipcar have exploded in cities where traffic and parking prices have soared; even kids are hailing a ride. And autonomous-car boosters promise a future where one self-driving sedan can shepherd a big crew of passengers between work, home and everywhere else, without even needing to park.

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    Fisker Automotive’s resurrection begins in California

    1. by  Kirsten Korosec @kirstenkorosec JUNE 22, 2015, 5:37 PM EDT

    The California-based company is opening a new factory and hiring hundreds of workers. The Fisker Karma is coming back. But will car enthusiasts buy it?

    Fisker Automotive and Technology—the resurrected luxury electric carmaker that famously crashed and burned after an auspicious beginning—is setting up shop in California.

    The company, which was acquired out of bankruptcy last year by Wanxiang America, plans to re-launch its Karma vehicle at a 555,670-square-foot factory in Moreno Valley, Calif. The company expects to create 150 full-time manufacturing jobs at the factory. About 240 people work at the company’s headquarters in Costa Mesa, less than 60 miles from the new factory.

    While the company had talked about renaming the car, spokeswoman Judy Hoste told Fortune that for now, the new car will also be named Karma. Fisker is not disclosing details about when it will begin production or the price of the car.

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    Ruling Says Netherlands Must Reduce Greenhouse Gas Emissions


    A court in the Netherlands has ordered the Dutch government to toughen its climate policies, a major ruling that could motivate environmental activists to pursue a similar legal strategy in other countries.

    The Hague District Court ordered the government to reduce greenhouse gas emissions by at least 25 percent from 1990 levels in the next five years. The government had previously committed to reducing emissions by 17 percent, but an environmental group, Urgenda, sued and demanded that the reductions be between 25 percent and 40 percent.

    In deciding the case, the court extensively cited the work of the Intergovernmental Panel on Climate Change and other scientific bodies. The court stressed the threat of changes caused by greenhouse gases and the importance of preventing the large-scale disruptions that climate experts predict will occur if long-term temperatures rise by more than 3.6 degrees Fahrenheit over the level of pre-industrial times.

    The decision, translated into English by the government, concluded that “the possibility of damages for those whose interests Urgenda represents, including current and future generations of Dutch nationals, is so great and concrete that given its duty of care, the state must make an adequate contribution, greater than its current contribution, to prevent hazardous climate change.”

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    BP economist: Oil industry should hunker down for “a couple of years” as prices recover

    Posted on June 24, 2015 | By Rhiannon Meyers

    The early U.S. oil industry experienced its first major crash just before the Civil War. In 1860, oil prices rose to over $10 per barrel, but by the next year had plummeted to just 10 cents. Some Pennsylvania boom towns disappeared overnight as a result.

    The surge in shale drilling that has made the U.S. the world’s No. 1 oil producer has started to slow under the weight of a global crude collapse, and that downturn is likely to stick around for a while, BP’s chief U.S. economist said Wednesday.

    Amid falling oil prices that plummeted by more than half in a few short months, the global oil giant has readjusted its business as it settles in for a prolonged crude slump, Mark Finley told an audience gathered in downtown Houston to hear his presentation of BP’s annual statistical review of world energy, a wide-ranging analysis of global demand and supply.

    “When we crunch the numbers, it looks like we could be in this for an extended period,” he said in response to a question at the breakfast meeting. “For at least a couple of years, we think it’s prudent to re-base operations around the prevailing reality we find ourselves.”

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    Iran will struggle to ramp up oil production after sanctions deal, Wood Mac says

    Posted on June 25, 2015 | By Bloomberg

    Iran will probably struggle to restore lost crude production if it secures a deal to ease sanctions because the condition of halted fields will have deteriorated and more investment will be needed, according to Wood Mackenzie Ltd.

    The country would be able to increase crude output by 120,000 barrels a day by the end of the year if it reaches an agreement on its nuclear program, according to a report by the Edinburgh-based consultant and Verisk Maplecroft. The report forecasts a further daily increase of 260,000 barrels by the end of 2016 and 220,000 barrels the following year.

    Iran and world powers are working towards an agreement that would ease sanctions on the OPEC member’s oil sales in return for curtailing its nuclear activity. A “deal leading to the unwinding of sanctions is likely,” Wood Mackenzie estimates. Restrictions imposed on Iran’s oil trade in 2012 have curbed its shipments by about 50 percent.

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    Climate Change Calls for Science, Not Hope

    JUNE 23, 2015

    Eduardo Porter

    Is the American approach to combating climate change going off the rails?

    Last year, President Obama set a goal of reducing carbon emissions by as much as 28 percent from 2005 levels by 2025, only 10 years from now.

    Now, environmental experts are suggesting that some parts of the strategy are, at best, a waste of money and time. At worst, they are setting the United States in the wrong direction entirely.

    That is the view of some of the world’s top environmental organizations, including Greenpeace, Friends of the Earth and the Sierra Club. On Tuesday, they argued in a letter to the White House that allowing the burning of biomass to help reduce consumption of fossil fuels in the nation’s power plants, as proposed by the Environmental Protection Agency, would violate the Clean Air Act.

    It’s also the view of economists from the University of Chicago and the University of California, Berkeley, who on Tuesday released the disappointing results of a field test of the federal Weatherization Assistance Program, the government’s largest effort to improve residential energy efficiency.

    Efficiency Gains Slow

    The energy intensity of the global economy — the amount of energy needed to produce a given amount of economic output — has been improving for decades, as the world’s economies have become more energy efficient. But those gains have slowed in recent years.

    It turns out that burning biomass — wood, mainly — for power produces 50 percent more CO2 than burning coal. And even if new forest growth were to eventually suck all of it out of the atmosphere, it would take decades — perhaps more than a century — to make up the difference and break even with coal.

    One study commissioned by the state of Massachusetts concluded that the climate impacts of burning wood were worse than those for coal for 45 years, and worse than for natural gas for about 90 years. Humans do not have that kind of time.

    The energy efficiency push has a different problem: It is much too expensive. The weatherization improvements cost more than twice as much as households’ energy savings. Even after including the broad social benefits from less pollution, it was still a bad deal. Indeed, the program spent $329 per ton of CO2 it kept out of the air, some eight times as much as the administration’s estimate of the social cost of damages caused by carbon.

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    Coal-state lawmakers attack climate rule no matter what pope says


    McClatchy Washington BureauJune 23, 2015

    WASHINGTON — Pope Francis’ call for urgent action to combat climate change isn’t having much influence on members of Congress from the coal state of Kentucky, who are working this week to block the centerpiece of the president’s agenda to limit the greenhouse gases that are warming the planet.

    The House of Representatives is expected as soon as Wednesday to pass a bill by Rep. Ed Whitfield, R-Ky., which would allow states to reject the Environmental Protection Agency’s proposed rule for carbon emissions from power plants. Whitfield’s bill also would ban the EPA from enforcing the rule until all the legal challenges are decided, which could take years.

    There’s a similar effort in the Senate. Senate Majority Leader Mitch McConnell, R-Ky., is calling on states to defy the Obama administration’s climate rule. He put language in the interior and environment spending bill that would allow them to do so without consequences, saying the Obama administration is at war “against Kentucky coal jobs, miners and their families.”

    The pope in his encyclical last week made a moral case for dealing with climate change and declared that “the Earth, our home, is beginning to look more and more like an immense pile of filth.” Among those who are welcoming the pope’s climate change message is Archbishop Joseph Kurtz of Louisville, Ky., who said the need for urgent action is clear.

    The Kentuckians who wield power in Congress, though, have a far less enthusiastic reaction.

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