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Guest Juice: Seismic Cracks in PG&E’s Diablo Analysis

March 26, 2015

By Rochelle Becker

—Rochelle Becker, Executive Director of the Alliance for Nuclear Responsibility at

Coming on the fourth anniversary of the ongoing nuclear disaster at Fukushima, PG&E’s self-congratulatory announcement that “New Analyses Show Diablo Canyon Safe From Extreme Natural Events” would be laughable, were it not for the potentially tragic consequences.

This latest seismic report, released March 12, was required of all reactor operators by the U.S. Nuclear Regulatory Commission as a consequence of Fukushima. It follows PG&E’s September 2014 release of a seismic update that was mandated by AB 1632.

The two studies shared data and were paid for by California ratepayers to the tune of $64 million.

The scientific objectivity of the project was debased from the outset.

PG&E’s paid consultants declared that the pool of available seismic experts (themselves included) possessing the knowledge to conduct such advanced research was small and, in their own words “incestuous.” Thus PG&E consultants, presenting various arguments and theories for their interpretation of the seismic hazard at Diablo Canyon, would also be the same people evaluating whether the diverse views and theories of other scientists would (or would not) ultimately be included in the final analysis.

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CPUC set to spend $5.2M on defense lawyers

The agency is facing three criminal probes

By Jeff McDonald6:26 P.M.MARCH 26, 2015

The California Public Utilities Commission has arranged to spend as much as $5.2 million on criminal-defense lawyers to respond to ongoing state and federal investigations.

According to a four-page amendment to a contract that was first signed late last year, the Sheppard Mullin law firm is authorized to bill up to that amount to represent the commission and certain employees through June 2016.

The original agreement was signed in November, days after state investigators executed a search warrant at the commission’s San Francisco headquarters and left with boxes of materials and potential evidence in an ongoing public-corruption case.

Raymond Marshall, the firm’s top white-collar crime defense attorney, is being paid a discounted rate of $882 per hour. Marshall’s usual rate is $990 per hour. Other attorneys listed in the agreement are billing the commission more than $700 per hour each.

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UC struggled with Peevey party funds

Dean of public policy school felt loyalty to utilities boss

By Jeff McDonald5:49 P.M.MARCH 26, 2015


Henry Brady, dean of the Goldman School of Public Policy at UC Berkeley

Days before he stepped down as the state’s top utility regulator, Michael Peevey called an assistant dean at his alma mater, the University of California, Berkeley, to say that a recognition dinner was being held in his honor, and net proceeds would benefit the Goldman School of Public Policy.

“Mike asks that you join the host committee,” assistant dean Annette Doornbos wrote to her boss, Dean Henry Brady, on Dec. 15. “He would like to know at your earliest convenience.”

The request appears on the first of 327 pages of emails to and from university officials related to the $250-a-plate tribute dinner that was held Feb. 12 at the Julia Morgan Ballroom in San Francisco.

The records show a barrage of criticism ensuing from alumni and donors, who urged Brady to reject the donations and distance the school from the public-corruption investigation encircling the utilities commission in general and Peevey specifically.

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CPUC judge on Peevey: ‘This was inevitable’

By Jeff McDonald11:48 P.M.MARCH 26, 2015

One of the most striking emails sent to UC Berkeley's Goldman School of Public Policy regarding its plans to receive the proceeds of a tribute dinner for former California Public Utilities Commission President Michael Peevey came from inside the commission.

David Gamson, the chief administrative law judge for the agency and a graduate of the school, reached out to Dean Henry Brady on Feb. 14, two days after the event. He offered to speak with Brady, or meet with him. Brady was in New Zealand, and the two spoke briefly, but Gamson eventually settled on an email, sent Feb. 15.

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State lawmakers slam oil regulators after embarrassing lapses



A pit containing wastewater from oil production.


March 26, 2015, 5:18 a.m.

The agency that regulates the oil industry in California is — by its own admission — in disarray. After a series of embarrassing disclosures about regulatory lapses that allowed drilling in protected aquifers, officials at the Division of Oil, Gas and Geothermal Resources are trying to untangle years of chaotic operation.

But the fixes aren’t happening fast enough to satisfy many state lawmakers. In recent weeks, elected officials have publicly chided the agency, launched their own investigations and introduced at least a half-dozen bills that aim to recast DOGGR’s mission to prioritize protecting public health and the environment over promoting energy development.

“The Legislature is going to be very engaged on this entire subject, relating to the safe operation of oil and gas drilling,” said Sen. Fran Pavley (D-Agoura Hills). “We are not going to advance one industry over the health and safety of other industries and the citizens of California.”

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Frac sand exec to slumping oil producers: You’re not going to drill your way out of this

Posted on March 26, 2015 at 1:44 pm by Collin Eaton in featured, Oil field services, Shale

HOUSTON – The message that a scientific approach should trump the all-out wildcatting of the fading shale boom is echoing through more corridors of the energy industry. But oil producers may not want to hear it.

Frac sand suppliers say U.S. oil producers should use the lull in drilling as a chance to step back and study mountains of oil field data to see which blends of water, sand and chemicals are best for blasting open shale rock, a process called hydraulic fracturing. Rapid-fire drilling – a practice that shale producers used during the boom to keep output rising over natural well depletion – often yielded bad, unproductive wells, as does hasty hydraulic fracturing, they say.

“There’s a high failure rate because we don’t do our homework,” said Jim Venditto, vice president of technical services at Trican Well Service, a fracturing firm that coats sand in material that makes it more buoyant and easier to pump into a well. He said producers have been talking more about finding ways to bolster well productivity, even as they send hundreds of drilling rigs to the sidelines.

“You’re not going to be able to drill your way out of this,” Venditto said. “Every so often we have to reinvent the oil industry again.”

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Vulnerable Oil Producers Tap Restructuring Advisors To Negotiate With Lenders

Debtwire Contributor

We provide fixed income news from across the globe

Opinions expressed by Forbes Contributors are their own.

BUSINESS 3/26/2015 @ 3:24PM 1,190 views

By Madalina Iacob

The record drop in oil prices over the last six months has consumers – and some investors – cheering. Optimists believe that the economy is ripe for a boost as would-be shoppers earmark their extra cash to spend on anything from dining out to apparel.

While shopping sprees may prop up some economic segments, there’s a darker side to the oil price plunge. Dozens of small oil and gas exploration and production companies in US regions like the Bakken formation and Permian basin collectively took out tens of billions of dollars of debt in recent years – predicated on the assumption that $100 per barrel oil was here to stay. Those highly levered capital structures are already starting to crack, as earnings slow down and the cost to drill doesn’t justify the revenue that the oil brings in.

A handful of the high-cost, debt-saddled exploration and production companies have already hired restructuring advisors and in a few cases have pulled the trigger and filed for Chapter 11.

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California’s shift toward renewables makes energy harder to manage

By Kim Smuga-Otto

POSTED:   03/26/2015 09:31:26 PM PDT


Power grid operators work in the grid operation center at the California Independent System Operator in Folsom, Calif on Monday, March 9, 2015. (Kristopher Skinner/Bay Area News Group)

Photos: California Independent System Operator in Folsom, Calif.

FOLSOM -- California's electrical grid has a problem -- a nice problem, but a problem nonetheless: The state often has too much power.

Nearly 23 percent of California's energy now comes from renewable sources such as wind and solar, and the state is on track to reach its goal of generating one-third of its energy from renewables by 2020. But feeding all that green energy into the Golden State's grid -- without overloading it -- has become a major challenge.

That's because the state's aging natural gas plants aren't nimble enough to turn off when the sun starts shining and then quickly switch back on when it gets dark. And while the technology to generate clean energy is growing by leaps and bounds, efforts to store the power haven't kept up.

The dilemma has forced the energy industry to rethink the way we make and use electricity. And utilities are having to recalculate how much they should charge for electricity at certain times of the day.

"I've seen more changes in the past three years than the previous 20," said Eric Schmitt, vice president of operations for the California Independent System Operator, the "air traffic control" center of one of the world's largest electrical grids. The center is capable of directing more than 50,000 megawatts of electricity -- the output of almost 300 average-sized power plants running at full capacity -- over high-voltage lines that crisscross the state.

The ISO's home in Folsom looks like a starship's control room in a science fiction movie: 12 horseshoe-shaped tables, each with eight wide screens. A bank of colorful monitors stretches for 80 feet across one wall, flashing graphs, maps and constantly updating reports.

The last time Californians had to think about their electrical grid was in the early 2000s, when companies such as Enron manipulated energy prices and caused statewide brownouts. Since then, the nonprofit organization that oversees electricity delivery to 80 percent of the state has faded from view.

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IKEA Fuels Up With Bloom Energy

Heather Clancy Contributor

I write about technology for conservation, efficiency and reuse.

Opinions expressed by Forbes Contributors are their own.

TECH 3/26/2015 @ 4:35PM 523 views

Home furnishing retailer IKEA has invested in numerous on-site renewable energy projects—almost 90% of its U.S. stores use solar technology, for example, plus it is experimenting with geothermal and wind.

But a new contract with Bloom Energy for a site in Emeryville, California, actually represents its first foray into fuel cells that use biogas to generate electricity. The technology should be up and running by the summer.

It isn’t a huge system, with a capacity of 300 kilowatts, and expected to produce about 2.5 million kilowatt-hours annually.

Still, the investment will help ensure at the majority of the power used at this site comes from clean, renewable sources. Or, at least, more clean and more renewable than what’s available on the local grid.

IKEA’s goal is to be “energy independent” by 2020. Its solar program is well established: it manages capacity of around 400 megawatts and actually owns the largest arrays operating in some states. The company also has invested in two wind farms with 104 turbines between them.

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Science Museums Urged to Cut Ties With Kochs


Dozens of climate scientists and environmental groups are calling for museums of science and natural history to “cut all ties” with fossil fuel companies and philanthropists like the Koch brothers.

A letter released on Tuesday asserts that such money is tainted by these donors’ efforts to deny the overwhelming scientific consensus on climate change.

“When some of the biggest contributors to climate change and funders of misinformation on climate science sponsor exhibitions in museums of science and natural history, they undermine public confidence in the validity of the institutions responsible for transmitting scientific knowledge,” the letter states. “This corporate philanthropy comes at too high a cost.”

The letter does not mention specific companies, but it does name David H. Koch, who sits on the boards of the American Museum of Natural History in New York and the Smithsonian National Museum of Natural History and has given tens of millions of dollars to those institutions.

Koch Industries is a privately held corporation with subsidiaries in energy and other industries. Mr. Koch and his family have funded conservative causes, including scientists and organizations that contest the role of humans in climate change.

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EPA Showdown Before Supreme Court May Hinge On Two Ambiguous Words

Michael Bobelian Contributor

I cover the Supreme Court, the law and its interplay with Wall Street

Opinions expressed by Forbes Contributors are their own.

BUSINESS 3/25/2015 @ 2:57PM 1,241 views


The Supreme Court heard oral arguments earlier today on another case questioning the Environmental Protection Agency’s efforts to curb pollutants from coal-based power plants.

The Court will have to determine when the EPA must apply cost-benefit analysis to measures limiting emissions under the Clean Air Act, the 1963 law Congress enacted to combat air pollution.

In its legal briefs, the EPA has argued “that costs are not relevant to the decision whether to regulate such emissions, but that costs should instead be taken into account when setting emission standards.” In other words, the agency wants to wait to determine the costs of its regulations until it has finalized its standards for each of the specific pollutants – such as mercury – it intends to regulate.

Its adversaries in the case have argued that the EPA must make these calculations earlier in the process. The difference may sound superficial but any delay in the enactment of stricter regulations has served as a victory for the coal industry, which has used litigation to fend off or postpone tighter pollution control for decades.

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As world expands nuclear power, US grapples with decades of waste

Nuclear energy is experiencing a renaissance around the world, but lawmakers in the US are struggling with a decades-old waste problem. It's one of the many challenges facing the US industry as competition grows in China and elsewhere.

By Jared Gilmour, Staff writer MARCH 25, 2015

    WASHINGTON — A nuclear power renaissance is underway in much of the world, but in the US you would hardly notice.

    Shifting energy economics and public safety concerns have made new American nuclear reactors rare, even as China and others ramp up investment in the carbon-free power source.

    But now, the US government is seeking to stay relevant in an evolving global nuclear industry, in part by proposing new ways to confront a decades-old challenge: handling mounting nuclear waste.

    “If we want to continue to have low-cost, clean power from nuclear reactors, which today produce about 60 percent of our country’s emission-free electricity, then we have to have a place to put the used nuclear fuel,” Sen. Lamar Alexander (R) of Tennessee said in a statement Tuesday, after reintroducing a bill to create a nuclear waste management agency. “That means we need to end the stalemate over what to do with our country’s nuclear waste by finding a way to create both temporary and permanent storage sites that would complement other solutions.”

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    Perry refuels its nuclear reactor, critics concerned about storage

    By John Funk, The Plain Dealer

    on March 26, 2015 at 9:00 AM, updated March 26, 2015 at 9:04 AM


    NORTH PERRY, Ohio -- FirstEnergy Nuclear Operating Co. is switching to a new type of fuel rod at its Perry nuclear reactor, one that is more simply designed, more robust and more efficient.

    But the switch-over has some anti-nuclear groups worried. One reason is that the rods contain slightly more enriched uranium, up to 5 percent rather than the traditional 3 percent.

    The newly designed rods are manufactured by Global Nuclear Fuel, or GNF, a joint venture of GE, Toshiba and Hitachi. Perry had been using rods manufactured by GE.

    GNF claims the new design not only increases energy output but that its use ultimately will allow a reactor operator to use fuel rods with lower levels of enriched uranium and to use fewer of them.

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    Feds probe PG&E report on California nuclear plant safety

    By David R. Baker

    March 25, 2015 Updated: March 25, 2015 9:32pm

    Federal investigators have launched a probe into whether the Nuclear Regulatory Commission erred when it let Pacific Gas and Electric Co. change earthquake safety standards at the Diablo Canyon power plant without public hearings, The Chronicle has learned.

    The regulatory agency’s own internal watchdog — the Office of the Inspector General — has been delving into the issue, which is the subject of a lawsuit filed in the fall by environmentalists trying to close Diablo Canyon, California’s last nuclear plant.

    In addition, the investigators are looking into complaints that the commission and PG&E colluded to dismiss seismic safety concerns raised by one of the commission’s former inspectors at Diablo Canyon, which is near San Luis Obispo on a stretch of coast riddled with fault lines. The inspector, Michael Peck, argued that the plant was no longer operating within its license and should be shut down until PG&E demonstrated that the reactors and other equipment could survive earthquakes on recently discovered faults nearby.

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    Funds for safety went to utility execs’ pay instead, PUC president says



    A massive fire roars through a mostly residential neighborhood in San Bruno, Calif., in a 2010 gas pipeline explosion that killed eight people.


    March 25, 2015, 6:01 p.m.

    Money collected from ratepayers and earmarked for pipeline safety was instead spent on executive pay raises by the state's largest utility, Pacific Gas & Electric Co., in the months before a deadly pipeline explosion in 2010, lawmakers were told Wednesday.

    “In some cases, the utility did divert dollars we approved for safety purposes for executive compensation,” the new president of the Public Utilities Commission complained to members of the state Senate Energy, Utilities and Communications Committee at an oversight hearing.

    After the two-hour hearing, Michael Picker told The Times that he's gathering additional documentation that PG&E put off safety and maintenance work to boost its profits and provide top executives with bonuses.

    “This is one of my outstanding beefs,” he said.

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