Mar
06
2017

Pipeline Benefits Consumers, North Dakota

The Dakota Access Pipeline remains a highly visible, highly controversial energy infrastructure project. As news reports convey, the pipeline project has been hotly contested by environmental groups and Native American tribes who live near the area where it is being built. Meanwhile, the State of North Dakota has supported the pipeline’s construction, believing it to be a safe means of transporting crude oil and a source of massive potential revenue for the state.

Helping to reinforce the state’s position, a new report from the Associated Press has confirmed that the state stands to gain $110 million per year in tax revenue from the pipeline. Keep in mind that the state’s General Fund is about $6 billion.

The pipeline, built by Dallas-based Energy Transfer Partners, will carry oil more than 1,000 miles to a shipping point in Illinois and will be in service in the coming days. This is good news for the nation’s energy infrastructure, as drillers have needed a cheaper means of transporting oil. The State of North Dakota, suffering through budget cuts due to declining tax revenues, could also use a shot in the arm from the pipeline project.

“Every dollar they get extra is good for the state as well,” state tax commissioner Ryan Rauschenberger said recently.

Over the past decade, North Dakota has become the second biggest producer of oil in the United States, with only Texas producing more. Its location is far from major oil markets, though, making transportation expensive and lowering profits from the oil’s extraction. This restricted transportation environment has forced the state to lower its taxes on each barrel of oil.

Today, North Dakota’s oil is shipped by either truck or train. Using the Dakota Access Pipeline to move oil instead would save $3 per barrel on shipping costs according to Ron Ness, president of the North Dakota Petroleum Council. State tax officials estimate every dollar per barrel saved on shipping costs means about $33.6 million in added tax revenue each year.

“Every dollar back is a win for producers, the state and mineral owners,” said Ness, who called the Dakota Access pipeline the most important infrastructure project in North Dakota since the interstate highway system.

The pipeline will link to existing pipelines that serve Gulf Coast refineries, which will pay a premium price for high quality oil from North Dakota.

Additionally, the pipeline is expected to generate $55 million in property taxes each year in the four states that it crosses, including $10 million in North Dakota that will provide much-needed revenue to the state’s rural areas. Adding the property taxes to the $100 million in oil taxes generates the $110 million in additional revenue for North Dakota.

The U.S. needs more energy infrastructure to make sure that domestic energy sources get to market. Specifically, we need more pipelines that can bring raw product from extraction sites to refineries. Having those pipelines in place helps reinforce our nation’s energy independence and security. As energy consumers, we all benefit when energy resources get to market more quickly with fewer costs.

Mar
06
2017

Wright: Nuclear Essential for Energy, Jobs

A March 1st opinion piece in Insider Advantage serves as an important reminder about the value of nuclear power to American energy. The author, Tal Wright, is an Atlanta-area media and marketing communications consultant. The piece, entitled “Nuclear Power Must Remain an Option for Energy & Jobs” and reprinted in its entirety below, is available online here.

Interviews with laid off coal miners in the aftermath of President Donald Trump’s victory may be anecdotal, but they’re a reminder of the demise of just one industry that has provided generations of families with well-paying, blue collar jobs that have been lost to new environmental regulations.

The Trump Administration inherited President Obama’s Clean Power Plan, which will result in cleaner and more expensive power production – and energy-related job losses – well into Trump’s presidency. In this context, the U. S. Energy Information Administration projects a total of 92 gigawatts of coal-fueled capacity will retire by 2030 – about 30 percent more (32 GW) without Obama’s EPA Clean Power Plan requirement.

That’s a lot of coal-fueled power plants and thousands, if not millions, of jobs that will continue to disappear on Trump’s watch – due to U. S. government regulations – not international competitors or unbridled immigration.

Combined with lower natural gas prices and the extension of renewable tax credits, Obama’s plan will accelerate utilities’ shift toward less carbon-intensive generation. That’s good news for the environment – and bad news for American workers and the country’s energy future.

The huge contributions that coal-fueled plants make to the electric energy grid are being replaced largely by natural-gas fueled generators. These plants emit significantly fewer pollutants than coal, and are capable of meeting large, base-load energy demands. And since most U.S. utilities have given up on nuclear, and already use natural gas to meet base load and peak needs, America is well on its way to becoming overly dependent on natural gas as a source of electricity.

While we should continue to invest in renewables like solar and wind, it’s important to remember these technologies rely on unpredictable weather patterns.

Nuclear power must remain an option for replacing at least a portion of the 92 gigawatts of coal-fueled electric energy production and thousands of lost jobs.

But nuclear power’s future is in jeopardy.

Toshiba, the Japanese firm which owns Westinghouse, the company that builds reactors and nuclear power plants, recently announced it would take a multi-billion dollar charge against operations due to cost overruns, quality control problems, and delays at the four nuclear power units currently under construction in the United States.

Two of these new units are under construction at Plant Vogtle, a nuclear power plant complex located southeast of Augusta.

Westinghouse has experienced many of the same problems that occurred with earlier nuclear power construction projects – including design changes, mandated by regulators, despite pre-approved, standardized designs.

Nuclear power plants take years to build, cost billions to construct, employ thousands of people during their construction phases and hundreds of people for operations. They generate thousands of megawatts of electric energy, produce almost zero emissions and serve customers for up to 60 years.

There are reports about the need to repair or replace crumbling highways, bridges and other public infrastructure, and how these projects could help create jobs for Americans. We’ve got an equal amount of work to do on the nation’s energy infrastructure.

That’s why our nation should preserve nuclear power as an option for replacing at least a portion of the 92 gigawatts of electric energy production and thousands of lost jobs it is about to lose.

Feb
27
2017

Are Dutch Trains Really Running Completely on Renewable Power?

In an “anything goes” era of news and social media, it’s not often that a post jumps off the page. But a recent piece of news about electricity caught my attention. The headline: “Netherlands Trains Now Running on 100% Wind Power”.

Of course, we’ve seen headlines of this type before. For example, in 2015, Burlington, Vermont, became the first city to announce it was running totally on renewable power. That’s true, of course. Burlington’s biggest source of electricity is hydropower imported from across the region. The city also gets about a third of its power from a large biomass plant. The rest is supplied by wind and solar power, which contribute about a fifth of the city’s power. In other words, the two oldest sources of renewable power, water and wood, are carrying most of the burden for Burlington’s renewable achievement, not the sources that might come to mind when people read the headline.

Do the claims about Netherlands trains also require further explanation? You bet.

The claim by the Dutch railway network, Nederlandse Spoorwegen (NS), is almost entirely a sleight of hand. In fact, an investigation by Energy Matters finds that the electrified portion of NS mainly runs on electricity derived from coal and natural gas.

“NS claims 100% wind power because it has a contract with various wind farms to produce enough energy to power its rail system, but this is just an accounting transaction,” writes author Roger Andrews. “Only a small fraction of the power delivered to its trains actually comes from wind.”

Read the Energy Matters Piece Here

What’s the trick? A little more than a tenth of all electricity consumed in the Netherlands comes from wind power, some of which is imported. But none of this wind power is directly connected to the NS rail system. Even the two Dutch wind farms with which NS contracts directly for wind power, Noordoostpolder and Luchterduinen, are tied generally to the Dutch grid and not tied directly into the NS rail system.

Plus, it turns out that about half the electricity NS uses to power its rail system comes from outside of the Netherlands. Some of the nations that supply power to NS such as Germany, Belgium, and Finland, do generate wind power, but only in modest amounts. That means electrons traveling across international borders to help power the NS railway system come in some amount from wind power, but in much larger amounts from non-wind sources.

“Putting these numbers together indicates that only 10-15% of the electricity consumed annually by NS’s electric trains will come from wind, with the rest a mixture that includes mostly Dutch gas and coal plus a small amount of Belgian and German coal, nuclear and lignite – and maybe even a little German solar,” Andrews explains.

When challenged on its claim, NS clarified that only the electrified portion of its system runs completely on wind power. This is about two-thirds of the system. But of course even two-thirds of the NS system doesn’t run “completely” on wind power. The electrons that run the electrified portion of the NS system come from many sources, including wind, but also from coal, natural gas, and nuclear. The truth is that it’s impossible to determine the source of electrons actually moving NS trains down the track. What is clear is that most of those electrons didn’t originate from wind turbines.

There are many reasons, of course, why NS would claim its trains run completely on wind power and even more reasons why many would celebrate this apparently breakthrough. Headlines like this make people feel good. It feels to many like progress. But let’s be real. The evidence speaks for itself. Claims that Dutch trains running entirely on wind power are way off track.