Perhaps you've heard about the Russian submarines patrolling international waters off the U.S. East Coast (if you haven't, take a look at a Reuters story about it) in what feels like an echo of the old Cold War. The Pentagon's not worried about this particular venture, but there are concerns from the U.S. energy industry about another Russian foray -- this one in concert with Cuba. In rhetoric that may ring a bell with anyone who saw the 1964 satirical nuclear-fear movie "Dr. Strangelove,"
the Washington-based Institute for Energy Research is sounding the alarm about a Russian-Cuban deal to drill for offshore oil near Florida.

"Russia, Communist Cuba Advance Offshore Energy Production Miles Off Florida's Coast," is the title on the institute's news release. Below that is the prescription for action: "Efforts Should Send Strong Message to Interior Dept. to Open OCS in Five-Year Plan." OCS stands for outer continental shelf, an area that was closed to oil drilling until the Bush administration opened it last year in a largely symbolic move aimed at driving down the sky-high gasoline prices of the Summer of 2008.

Environmentalists hate the idea. So does Sen. Bill Nelson, a Florida Democrat who has made opposition to offshore drilling one of his signature issues. But as it turns out, it's unlikely that anybody -- from Russia, Cuba, the United States or anywhere else -- is going to get petroleum out of the OCS in the immediate future.

For a start, it takes time to set up a deep-water offshore drilling rig. And any Cuban effort would be further hampered by the need to use equipment with less than 10 percent American technology, to comply with the long standing U.S. embargo against Cuba. As my Reuters colleague Russell Blinch reported in June, there may be scope for possible U.S.-Cuban cooperation here but no Cuban drilling platform is likely to be in the area this year.

Reports of a Russian-Cuban deal to explore for oil in the Gulf of Mexico prompted a quick response from the Institute for Energy Research, self-described as a free-market energy think-tank.

"This agreement between Russia and Cuba should serve as a wake-up call to Congress and this administration, especially (Interior) Secretary (Ken) Salazar, who is slow-walking a new offshore energy blueprint for the nation," the institute's president, Thomas Pyle, said in a statement. "If we are to remain competitive in the global market, our government must take its foot off the brake, and expand domestic energy production of all forms, onshore and off.”

What's your take? Should the United States drill baby drill off Florida's coast, reasoning that if U.S. companies don't, Russia and Cuba will? Keep a congressional ban in place? Or wait and see?

Photo credit: Reuters staff photographer (Pensacola Beach, Florida, June 25, 2008); Reuters stringer/Russia (Russian nuclear submarine off Vladivostok, July 24, 2009)

German utility RWE – Europe’s fifth-largest power company and the continent’s biggest emitter of carbon dioxcide – has resorted to a new way to counter what it sees as a fundamental misunderstanding about power companies.

Its animated movie – to be shown on TV and in cinemas – is meant to show what the company is really about – and overcome the public’s distaste for an industry whose dominance has allowed it to mete out ever higher power prices.

RWE portrays itself as a colossus with trees growing on his shoulders. He dives into the sea to install tidal-power plants and repairs power lines with gentle force.

Interestingly, this leviathan has characteristics that run contrary to what RWE might want to say. It supports some of the charges consumers level against utilities and has traits utilities always deny.

Many criticize the market dominance of utilities that allows them to raise prices and give consumers little option other than to pay up.

The giant of the film is alone in what he does and seems to be in complete control of his domain. He does not have to struggle with others who want to build windmills where he wants to.

Utilities claim they are accountable and transparent – to the public as well as their shareholders. The colossus has no need to justify himself. He does whatever he does because he wants to do. He rules.

He also leaves a large question mark over at least one key issue ahead of the general election in Germany in September. Would this giant’s engineering skills be sufficient to operate nuclear power plants? 

Utilities – and the conservatives and liberals in Germany – are seeking to extend the lifespan of nuclear power plants, saying they would be safe to run at least 10 years longer.

We might emerge from our 2 minutes of viewing with the conviction they will be maintained, but at least the RWE giant is shown to be nice, extremely focused on renewable energy and always working for the benefit of its clients.

OPEC’s president Angola might well be asking himself why he is paying nearly 2 million euros to belong to the oil producers’ club when the World Bank has told the nation it would be better off without it.
The Angolan energy minister, who currently holds the group’s rotating presidency, has yet to arrive in Vienna for this Thursday’s meeting of the Organization of the Petroleum Exporting Countries, which is expected to keep existing output targets unchanged.
Member countries have already agreed to lower production by 4.2 million barrels per day since last September and have been delivering around 80 percent of the promised curbs.
Now the oil price has climbed back above $60 a barrel, almost double the lows of last December, members like Angola might well sigh with relief and pump even more above their OPEC output target than they are already doing.
Last week, the World Bank said Angola’s economy would perform far better this year if the country did not limit production, as OPEC has requested, and that wasn’t taking account of the OPEC membership fee, which is heard to be the same for all members, whether they are the smallest producer Ecuador or the biggest Saudi Arabia.
Oil ministers might have saved a night or two on hotel accommodation, however, as several were expected to arrive later than originally stated and also to disappear immediately after Thursday’s meeting.
Delegates predicted it would be short and to the point, provided Angola and others unhappy with output targets did not open a Pandora’s Box of a debate on production goals.
The controls are aimed at supporting oil prices as the market is already well-supplied, but some argue a better way to boost OPEC earnings would have been to call the meeting off.
It would not be good business for Vienna hotels or struggling airlines, but it would cut the expenses and carbon emissions of the OPEC delegations and the pursuing press pack, as one weary analyst observed.
“We are forced to mention that there is an OPEC meeting this Thursday in Vienna, although there is so little to expect out of it that OPEC could have made a gesture to save its and the media’s carbon footprint by calling it off,” said Olivier Jakob of Petromatrix.

Locations of shale basins not geographically precise. E.g. Haynesville basin is located on the north Louisiana/east Texas border. Figures in trillion cubic feet. Source: The Federal Energy Regulatory Commission website, derived from the American Clean Skies Foundation.

Rising estimates of U.S. recoverable natural gas reserves from shale deposits could keep natural gas prices low over the next few years. The above map shows the sharp increase in recoverabe reserves from select shale basin in trillion cubic feet from 2006 to 2008.

Recent advances in horizonal drilling and rock fracturing techniques have made shale gas — traditionally quite costly to develop — more viable and help boost reserve estimates. — Joe Silha

Just how far is the U.S. government willing to go to cut carbon dioxide emissions and other greenhouse gases blamed for global warming.

Eric Wegner, whose company is the largest Internet distributor of the iconic Pop Rocks candy, hopes the government doesn’t have too much of a sweet tooth.

The House Energy and Commerce Committee began hearings this week on legislation that aims to go after coal-fired power plants, oil refiners and other emitters of C02 emissions. At the same time, the Environmental Protection Agency said last week that CO2 is a danger to the public health, which could eventually lead to regulation of the emissions by the agency.

Pops Rocks actually emit carbon dioxide gas. The candy is made by heating its ingredients of sugar, corn syrup and flavoring until they melt. Then the candy is exposed to pressurized carbon dioxide as it cools. That causes small bubbles of CO2 to be trapped in the candy.

The CO2 gas is released when the candy comes in contact with the mouth’s saliva. That is what causes the popping and sizzling sounds.

Wegner said Pop Rocks shouldn’t be blamed for global warming, even though the candy has been spewing emissions since 1975 when it was first sold to the public.

“I haven’t put any chemistry experiments behind it, but the amount of CO2 that comes out of pop rocks is probably small,” he said.

Wegner said nobody from the government has warned him yet that Pop Rocks may be regulated. “Could you imagine if they went that far,” he said.

An EPA spokeswoman said “it’s too early in the process” to know if that will happen, while EPA head Lisa Jackson told lawmakers that any regulation would be “for those large sources” of CO2 emissions.

A spokesperson for the House Energy and Commerce Committee wasn’t sure whether the emissions legislation would affect the candy.

Unlike many companies that would be affected by emissions regulation, Pop Rocks can’t afford a lobbyist to make sure its interests are protected in Washington.

“You know, we’re such a small fry we don’t even do advertising. For us to hire a lobbyist, forget about it,” Wegner said.

For more news on global warming, click here

Not interested in the humdrum appeal of driving the same car everyday, more city dwellers revel in the ability to be practical in a Honda Civic one day, conquer the road in a Ford Escape SUV the next and end the week sporting around in a Mini Cooper Convertible. How? Through car sharing. 
    
Gas price spikes and a shaky economy are driving more Americans in urban areas to forgo car ownership for car sharing, said the head of Zipcar.
    
Zipcar, the world’s largest provider of cars by the hour or day, saw it’s membership soar 50.3 percent in the past 12 months.
    
Scott Griffith, Zipcar’s chief executive, told Reuters that he’s seeing a significant change in people’s behavior when it comes to car use.
    
“In the past, about 40 percent of our membership base either sold a car or chose not to buy a car because of our service,” Griffith said. “More recently in the last 12 months that number has gone to over 60 percent.”
    
The economic downturn is adding to the popularity of car sharing as the credit crunch makes it more difficult to get car loans and some are forced to sell their car for the cash or to avoid defaulting on their payments. 

Griffith said Zipcar members are also looking to other modes of transportation.
    
He said people take 46 percent more public transit trips, 26 percent more walking trips and about 10 percent more bicycling trips after joining Zipcar.
    
“That significant increase in other ways of getting around town sort of combines with Zipcar to show an overall decrease in vehicle miles traveled,” Griffith said.
    
“They drive a lot less, more than 50 percent less in total miles annually,” he added.
    
Zipcar operates in the United States, Canada and London. A merger with Flexcar in 2007 made the company the largest car share company in the world.
    
But car rental company Hertz Inc plans to bring some competition as it opens Connect by Hertz, a car sharing unit available in London, Paris, New York and expanding to more locations in the United States.
    
Zipcar maintains it sets itself apart from other car rental companies by offering “fun” cars like the Mini Cooper and convenient pickup locations and by trying to build a sense of community among its members, Griffith said.
    
“We want you to drive the car you would aspire to own. We want you to be proud of using car sharing,” he said.
    
Griffith said that 19 percent of car owners’ incomes go to transportation costs, while Zipcar could bring that figure down to 3 or 4 percent if they get rid of their car.
    
Griffith wants people to look at Zipcar as a replacement for car ownership.
    
People want the freedom to pick up and go whenever they like and car sharing offers them access to this freedom, he said, without needing to own a vehicle.

For more on Americans and their cars, click here.

Photo Credit: Reuters/Mike Segar (Cars wait in a traffic jam on a New York City highway); Handout photo from Zipcar

At last year's American Petroleum Institute conference, Bill Klesse, CEO of leading U.S. oil refiner Valero, slammed federal policymakers who push subsidies and mandates for production of ethanol, saying that using corn to make it would make food so expensive it would cause more misery than global warming.

"All of these programs are just a huge transfer of wealth from our industry (oil) to the Midwest farms," Klesse said in March 2008 speech.

A year later, Klesse has decided to join rather than fight. If the money is going to the Midwest corn farms, why not cash in, right? Valero two weeks ago was chosen by a bankruptcy court as the winning bidder for two more VeraSun ethanol-producing plants.  The sale of seven former VeraSun plants closed on Wednesday and two more are expected to close soon.

A year and two weeks ago, Klesse said the federal government should stop favoring ethanol with subsidies. Now, Klesse and Valero are securing a supply of ethanol that it needs to mix with its gasoline.

"We expect increases in the Renewable Fuels Standard to continue," Klesse said two weeks ago when Valero's bid for VeraSun's plants was awarded.

The plants, in Iowa, Minnesota, South Dakota, Nebraska, and Indiana together will have a combined capacity that is 7.5 percent of the current operating U.S. ethanol capacity.

On Thursday, a Valero spokesman said the company needs to go full throttle on producing ethanol to mix with its gasoline. See the Reuters story.

(This is a photo of an ethanol plant taken in 2008. Reuters photo by Mark Blinch.)

Democrats floated big plans to tackle climate change proposals in the U.S. Congress this week but realistically there will be much more hot air — both from industry and politicians — before this bill is turned into law.
 
The draft legislation, running hundreds of pages, will now be considered by the House Energy and Commerce Committee in coming weeks along with all manner of panels. And, oh yes, the Senate, home of the filibuster, will also get to weigh in.
    
At the heart of of the legislation is Cap and Trade — a panacea for those who believe greenhouse gas emissions are warming the planet to dangerous levels and a boon to those who think the sinking economy makes this the dumbest time to anchor industry with more costs.
    
“This legislation will create millions of clean energy jobs, put America on the path to energy independence, and cut global warming pollution,” said House Energy and Commerce Committee Chairman Henry Waxman.
    
Sounds good but Waxman is a Democrat from California, where these ideas are more readily embraced.  
    
Listen to what a guy from Texas thinks: “Tuesday’s cap and trade bill marks a triumph of fear over good sense and science and it couldn’t come at a worse time because it proposes to save the planet by sacrificing the economy,” said Representative Joe Barton, the senior Republican on the energy and commerce panel.
 
In a cap and trade system, power plants and other industries would need permits for every ton of carbon dioxide they emit. Unused permits could be sold to other companies, but overall emissions would gradually drop.
    
Under the proposal that uses 2005 as a base year, U.S. carbon emissions would have to be reduced by 20 percent by 2020, 42 percent by 2030 and 83 percent by 2050. Those goals are a tad more aggressive than what President Barack Obama had proposed.
    
Now let the games begin. Very few seem ready to predict when a climate change bill will pass but most say it won’t be this year — especially if Democrats in Congress decide to give Obama’s health care plans the priority.
    
So there certainly will be a lot more talk, much of it heated. And one other thing is for certain: each yearly delay will mean the United States, as the world’s largest emitter, will spew another 6 billion tonnes of carbon dioxide into the atmosphere.

For more Environment News, click here.

Photo Credit: Reuters/Eric Thayer (The Empire State building in New York turned off its lights on March 28 at 8:30 pm local time, joining homes, office towers and landmarks in more than 80 countries that signed up for Earth Hour to raise awareness about climate change); Reuters/Chris Baltimore (An aerial photograph of a power plant in Georgia)

Alaska is known as a big oil producing state, but don’t forget about it when it comes to renewable energy. That was the message of the state’s senior senator, Lisa Murkowski, to U.S. Interior Secretary Ken Salazar. 
    
At a Senate Energy and Natural Resources Committee hearing this week, Salazar showed several large U.S. maps of potential wind, solar and geothermal energy resources. One problem, the country’s biggest state, Alaska, was nowhere to be found.
    
“There are few things that irritate me more than maps of the United States of America that do not include that great northern state,” Murkowski told Salazar, as the standing-room-only hearing room burst into laughter.
    
“Our renewable energy resources are wonderful and vast and we look forward to the time that you will come up to visit them,” she said. 
    
Murkowski even defended Hawaii, which was also left off Salazar’s maps.
    
“We do encourage the Department of the Interior to make sure that all 50 states are represented on your maps,” she said, raising more giggles from committee members and those sitting in audience, including the press table.
    
Salazar was just as amused.
    
“That’s a point well taken,” he said. “Alaska is so important that it merits a map all to itself.”
    
“You’re right,” Murkowski responded.
    
If Salazar follows through on his promise, the solar energy map for Alaska would be rather dark — at least during the winter, when the sun doesn’t shine in some parts of the state for several months and is out for only a few hours a day elsewhere.

–Tom Doggett

For more news on renewable energy, click here.

Photo credit: DOI (Interior Secretary Salazar testifies before Senate committee)

As the debate over "clean coal" rages on, General Electric is keen on offering up ideas to help coal transition from yesterday's polluter to a greener source of energy.
    
John Krenicki, the head of GE's energy infrastructure unit, says governments should invest in a dozen large-scale clean-coal demonstration plants in the United States, Europe, China and India. The plants would generate between 600-900 megawatts of power each and capture and sequester climate-changing greenhouse gases underground.
    
"We can change the game in coal for the next 100 years," he told Reuters in an interview.
    
Some environmental groups consider clean coal nothing more than a fairy tale. The technology to capture and store carbon in an environmentally safe way is commercially untested and not yet cost competitive, they say.
    
But the U.S. stimulus package provided $3.4 billion for fossil energy research and development. Some of these funds could resurrect the FutureGen pilot clean coal project that was abandoned last year.
    
President Barack Obama, White House Chief of Staff Rahm Emanuel and Transportation Secretary Ray LaHood -- all former Illinois legislators who fought hard for Illinois-based FutureGen -- are now in positions to push clean coal forward.
    
The United States must show leadership in this area if it expects the rest of the world to do its part to combat climate change, according to Krenicki.
    
"We're pursuing (projects) in the European Union and we're pursuing them in China, but the answer from most countries is, 'We'd like to see the U.S. lead,'" Krenicki said.
    
A 600 MW clean coal plant would cost more than $2 billion to build, but it would also create thousands of jobs in states hit hard by the economic downturn, he said.
    
Krenicki said the United States seems "paralyzed" by trying to jump to strictly green and renewable electricity generation from its dependence on fossil fuels. Clean coal, he says, is a needed evolutionary step to get the country out of the current stalemate to a green future.
    
Krenicki noted that with technologies like a smart grid and wind turbines the results are quick and easy for voters to see. "You can put points on the board so I think it's politically acceptable," he said of such projects.
    
"Some of these other technologies, like cleaner coal, you're doing it for the next administration, even if you're two-term," he said.

For more green business news, click here.

Photo credit: Reuters/Brendan McDermid (GE's John Krenicki); Reuters (A miner working at a coal mine in China)