By Steve Goreham
Originally published in Communities Digital News.
The global energy outlook has changed radically in just six years. President Obama was elected in 2008 by voters who believed we were running out of oil and gas, that climate change needed to be halted, and that renewables were the energy source of the near future. But an unexpected transformation of energy markets and politics may instead make 2014 the year of peak renewables.
In December of 2007, former Vice President Al Gore shared the Nobel Peace Prize for work on man-made climate change, leading an international crusade to halt global warming. In June, 2008 after securing a majority of primary delegates, candidate Barack Obama stated, “…this was the moment when the rise of the oceans began to slow and our planet began to heal…” Climate activists looked to the 2009 Copenhagen Climate Conference as the next major step to control greenhouse gas emissions.
The price of crude oil hit $145 per barrel in June, 2008. The International Energy Agency and other organizations declared that we were at peak oil, forecasting a decline in global production. Many claimed that the world was running out of hydrocarbon energy.
Driven by the twin demons of global warming and peak oil, world governments clamored to support renewables. Twenty years of subsidies, tax-breaks, feed-in tariffs, and mandates resulted in an explosion of renewable energy installations. The Renewable Energy Index (RENIXX) of the world’s 30 top renewable energy companies soared to over 1,800.
Tens of thousands of wind turbine towers were installed, totaling more than 200,000 windmills worldwide by the end of 2012. Germany led the world with more than one million rooftop solar installations. Forty percent of the US corn crop was converted to ethanol vehicle fuel.
But at the same time, an unexpected energy revolution was underway. Using good old Yankee ingenuity, the US oil and gas industry discovered how to produce oil and natural gas from shale. With hydraulic fracturing and horizontal drilling, vast quantities of hydrocarbon resources became available from shale fields in Texas, North Dakota, and Pennsylvania.
From 2008 to 2013, US petroleum production soared 50 percent. US natural gas production rose 34 percent from a 2005 low. Russia, China, Ukraine, Turkey, and more than ten nations in Europe began issuing permits for hydraulic fracturing. The dragon of peak oil and gas was slain.
In 2009, the ideology of Climatism, the belief that humans were causing dangerous global warming, came under serious attack. In November, emails were released from top climate scientists at the University of East Anglia in the United Kingdom, an incident christened Climategate. The communications showed bias, manipulation of data, avoidance of freedom of information requests, and efforts to subvert the peer-review process, all to further the cause of man-made climate change.
One month later, the Copenhagen Climate Conference failed to agree on a successor climate treaty to the Kyoto Protocol. Failures at United Nations conferences at Cancun (2010), Durban (2011), Doha (2012), and Warsaw (2013) followed. Canada, Japan, Russia, and the United States announced that they would not participate in an extension of the Kyoto Protocol.
Major climate legislation faltered across the world. Cap and trade failed in Congress in 2009, with growing opposition from the Republican Party. The price of carbon permits in the European Emissions Trading System crashed in April 2013 when the European Union voted not to support the permit price. Australia elected Prime Minister Tony Abbott in the fall of 2013 on a platform of scrapping the nation’s carbon tax.
Europeans discovered that subsidy support for renewables was unsustainable. Subsidy obligations soared in Germany to over $140 billion and in Spain to over $34 billion by 2013. Renewable subsidies produced the world’s highest electricity rates in Denmark and Germany. Electricity and natural gas prices in Europe rose to double those of the United States.
Worried about bloated budgets, declining industrial competitiveness, and citizen backlash, European nations have been retreating from green energy for the last four years. Spain slashed solar subsidies in 2009 and photovoltaic sales fell 80 percent in a single year. Germany cut subsidies in 2011 and 2012 and the number of jobs in the German solar industry dropped by 50 percent. Renewable subsidy cuts in the Czech Republic, Greece, Italy, Netherlands, and the United Kingdom added to the cascade. The RENIXX Renewable Energy Index fell below 200 in 2012, down 90 percent from the 2008 peak.
Once a climate change leader, Germany turned to coal after the 2012 decision to close nuclear power plants. Coal now provides more than 50 percent of Germany’s electricity and 23 new coal-fired power plants are planned. Global energy from coal has grown by 4.4 percent per year over the last ten years.
Spending on renewables is in decline. From a record $318 billion in 2011, world renewable energy spending fell to $280 billion in 2012 and then fell again to $254 billion in 2013, according to Bloomberg. The biggest drop occurred in Europe, where investment plummeted 41 percent last year. The 2013 expiration of the US Production Tax Credit for wind energy will continue the downward momentum.
Today, wind and solar provide less than one percent of global energy. While these sources will continue to grow, it’s likely they will deliver only a tiny amount of the world’s energy for decades to come. Renewable energy output may have peaked, at least as a percentage of global energy production.
Steve Goreham is Executive Director of the Climate Science Coalition of America and author of the book The Mad, Mad, Mad World of Climatism: Mankind and Climate Change Mania.
There is no viable large scale utility level storage technology available. Nor is anything realistically on the horizon.
A test project in Minnesota requires batteries the size of TWO semi trailers to provide backup power for a sing 1.75 MW wind turbine, and even the they could barely provide enough backup to get thru one night. And that was for just 500 homes.
Same with the silly ‘molten salt’ storage idea for solar – which contrary to claims was NOT included on the new Ivanpah plant. At best they might be able to store enough power this way to again get thru a single night … maybe …. for the 140,000 homes the 3,500 acre 377 MW solar facility is supposed to power.
I’m surprised no one has brought up Iceland … an idiot leftist greenie keeps telling me they “prove” renewables can power the world …. they always quote “Renewable energy provides almost 100 percent of electricity production” in Iceland … ignorantly bypassing the actual facts:
“…with about 75 percent coming from hydropower and 25 percent from geothermal power”
Yep, we’ll just whip up massive hydro and geothermal projects everywhere across the globe …
Idiots.
Janice Moore says:
March 1, 2014 at 10:31 pm
– – –
I thought maybe another Happy Hamster Dance video would be appropriate. But then I remembered the Tribbles I got myself into last time. 🙂
the shame of it is they could not make the windmills look like ones of old with the lovely sails, oh and actually produce some power worth talking about, at least the ones of old ground corn that fed the population and actually paid for themselves.
Anyone want buy a slighty used electric car? There is a glut of unwanted ones on the market in the UK.
http://www.thetimes.co.uk/tto/business/industries/transport/article4019953.ece
fredb says:
March 1, 2014 at 11:10 pm
Funny story. My renewable energy shares have risen frmo $4 to $18 in the last year. If that’s evidence of decline, roll on decline…
Janice Moore says:
March 1, 2014 at 11:24 pm
@ur momisugly Fred B. — SELL. Now.
Your friendly investment advisor.
======================================================================
No, do not sell. Simply enter a trailing stop order for $2 below price. This will ensure you stay in your investment while it is rising but will prevent losing your profits if there is a down turn.
Wind turbine recycling might be a good line of business to get into in the next 5 years or so.
Our renewable energy programs are unsustainable. The depend upon heavy regulation and subsidies to survive. The stock market is peaking and due for a correction; most of the recent gains are from the Fed policies of printing money and a return to easy and almost free credit.
Believe me, without government policy propping up your renewable energy stocks, they would be penny stocks.
Janice Moore wrote:
Dear Janice Moore, who signed “Gentile friend,”
I chuckled to read what you wrote at the end
Yes, “goyi” was written by CNXTim,
But I think you might have misunderstood him
The letters were lower-cased, but I realized
As acronym, they should be capitalized:
Here’s what he thought he meant, it seems to me:
“goyi” is “Good Old Yankee Ingenuity”
Yes, when I first saw it, I puzzled too
But I don’t think he was involving a Jew
===|==============/ Keith DeHavelle
cnxtim says:
March 1, 2014 at 10:06 pm
**********
OBTW
Fracking in the USA has been around this part of the world since like the late 1940’s. The father of fracking just passed away a few weeks ago…
And engineers from the USA are the best. But that is a cultural thingie way beyond the scope of this article.
Regarding the “goyi” I would attribute the recent rise in tight oil & gas production more to good old American Free Market Capitalism than technology. There has been a massive financial investment in opening up these markets, not so much a “new” technology – after all fracking has been in common use for many decades and they frack conventional wells, not just tight shale formations.
On investing in green energy I like to use First Solar as a barometer for what’s going on in the USA. Three to four years ago the shares were trading at $120-$160. They are now trading in the $40-$60 range. Yes they have risen sharply in 2013, from a five year low in July 2012 of under $20 a share, but that is a climb from the septic tank to the toilet IMO. I’m leaning toward Janice as a financial advisor. Sell Green in 2014.
http://www.nasdaq.com/symbol/fslr/interactive-chart?timeframe=1y&charttype=line
The unavoidable deficiencies of renewables wind and solar is their uncontrollability and massive land use requirements, a deficiency which would have been lambasted by the environmentalists if it pertained to any of their favored energy sources. My calculations, based on California solar farm densities, is that roughy 80,000 acres of land (hopefully level and sunny) are required to produce the same GROSS output as a modern nuclear 1400 MW power plant.
Because of the negative effects of locating wind turbines in anything like close proximity to one another, the total land required to support one of those 3200 (or more) “wind power plants” that can produce the same GROSS output as a modern nuclear plant (environmental footprint of 50 acres) is astonomical, and the cost several times greater (unless you believe the wind folk’s exaggerated claims for nuclear power plant construction). I’ve seen ridiculously nonsensical claims from the wind lobbiests that nuclear plants cost over $15 billion. I’ve also monitored nuclear plant fixed price build contracts over the past two years and would expect $15 billion to be close to the price for 3 nuclear plants, not one.
. Not to mention the fact that those friendly wind turbines are making out Whooping Cranes extinct, apparently, and for certain are wiping out bats by the carload, along with our raptor birds.
Both renewables have negative effects and are responsible for side effect costs, such as the need to keep and man backup power capacity. And, contrary to yet another wind enthusiast
claim, cheap power storage will not erase these side effect costs. The same amount of backup will still be required, regardless of how much power storage is available or how little its cost. The ability to store reserve electricity has no effect on those side effect costs.
As for solar and especially wind, the more that one adds, the lower the capacity, and the higher the costs. How much capacity windmills in Texas or Iowa are capable of means nothing when
errecting a turbine in an area with far less wind resources. Therefore, one should never assume that the amount of new wind power can be estimated by looking at the statistics for existing turbines. The cost of wind power is virtually totally dependent upon the amount of wind at the turbine’s location. And when it blows. And most of the good wind areas have already been taken. That, if nothing else, limits wind’s future, along with the absence of any possibility of better (or cheaper) turbines. And installation and maintenance costs are only going to increase.
Until govt purchase requirements for solar and wind are removed and an honest competitive
pricing market is established, it is impossible to get a truly accurate fix on how renewable energy is actually worth. Renewable energy simply isn’t worth very much to a grid operator. It adds costs and headaches. Period. And if environmentalists attempt to make analyses showing them to be competitive, based on supposed side effect benefits, then they implicitly destroy any reason not to prefer nuclear power above all else. And if they attempt to show nuclear power as dangerous, they will have an impossible task as it is. The new Generation 3+ designs can easily be calculated as thousands of times safer than solar or wind power. And probably a million times safer than solar rooftop mounted systems. As for the future of nuclear fuel, that will exist at least as long as the sun shines or the wind blows. Environmentalist’s arguments at this point are pretty much shattered. There is no valid, or even plausible, argument in favor of solar or wind as producers of emission free power. They are basically primitive, costly and environmentally obnoxious ways of making power of litte intrinsic value. If one of these renewables enthusiasts want to buy (all by himself, with no govt welfare) a solar roof system and install batteries and operate off the grid, more power to him (or her). But I don’t think that’s going to happen. Environmentalists apparently always expect their neighbors to pay for a good portion of their electricity. They are, you know, welfare queens. Only in this case, they think they are doing their neighbors a favor.
Mr. Gorham, you need to get your facts about tight oil and shale gas reserves correct. That horizontal drilling and fracking has opened new technically recoverable reserves is without doubt. The US has the worlds second largest tight oil shale deposits. The current maximum TRR estimate is 29Bbbl. Of that 15Bbbl is in the Monterey, where horizontal drilling isn’t possible because of folding and faulting. So while the TRR estimate is ‘technically correct’ it practically isn’t. In context, the remaining economic reserves in the Ghawar field alone are 71Bbbl, and at current planned Saudi production reductions as watercut rises that field will be fully depleted (zero left) in 34 years.
The largest oil/gas shale in Russia is the Bazenov. 70 times larger than the Bakken. But the potentially productive part ( in the oil not gas window, >2%TOC) is only 14x. It is the source rock for all the great western Siberia conventional fields like Samotlor, so 25% of it is naturally autofractured and depleted. The Bakken single main pay target averages 85 feet thick. Bazenov has three pay targets, each at most 10 feet thick. At Bakken recovery rates, when you do the math, Bazhenov might hold as much as the Bakken, current estimates 7.4Bbbl (USGS) to 8.0Bbbl (EIA), both estimates as of 2013. But it will be much more expensive since individual wells will be less than 1/3 as productive due to the narrow pay zones, so far is now known Shell is drilling the first 5 test horizontal/frac wells at Samlyn now; we will know more next year.
I agree renewables are not viable, especially given intermittency driven redundancy costs. But wind and solar don’t provide liquid transportation fuels. There are exactly zero viable cellulosic ethanol plants yet, although two might come on this year viable with subsidies. The KiOR bio syncrude plant in Mississippi operated at half of projected yield and half of projected uptime 3Q13 (so a fourth of projected capacity) so has been shut down for redesign upgrades with an additional $100m of capital investment. Now it’s economics are dubious.
Climate change is not a concern, as many posts here at WUWT and elsewhere show. The pause, lower sensitivity, emergent self temperature regulation… So renewables were ill advised from the outset. But that does not address future transportation fuel availability. Both the EIA (more specific and realistic) and the IEA (more vague) now say the US will reach peak tight oil production around 2019 to 2021, at a total production (all oil) level 2-3mbpd BELOW its overall peak in 1980-81. With growth in demand since then, even at the peak of tight oil the US will still need to importat least a third of its crude.
Get your oil facts straight. Most of what you read in the MSM about tight oil is hype better suited to SkS than here. BTW, these comments do not apply to shale gas, where recovery factors are 15% rather than 1.5% and new energy vistas are opened for electricity via 60% net efficient CCGT. That, not the EPA, is causing the decline in King Coal.
for Cnxtim, and any others who don’t realize how revolutionary the fracking breakthrough of the last 10 years has been – yes, fracking has been around aind 1949. But fracking SHALE reserves hasn’t, and that is the big game changer. Exxon, Chevron, Shell, BP – all of the majors said it could not be done, and gave up on the idea. As the Economist wrote in 2012:
”
“The rise [in shale gas] has been helped along by a variety of factors…. But the biggest difference was down to the efforts of one man: George Mitchell, …who saw the potential for improving a known technology, fracking, to get at the gas. Big oil and gas companies were interested in shale gas but could not make the breakthrough in fracking to get the gas to flow. Mr Mitchell spent ten years and $6m to crack the problem (surely the best-spent development money in the history of gas). Everyone, he said, told him he was just wasting his time and money. ”
—The Economist, July 2012”
Even in Texas, in oil and gas circles, Mitchell was thought of as an eccentric who’d gone off his rocker, wasting his life chasing a pipe dream. And then – turned out that Mitchell was right, and everyone else in the business was wrong. People think Steve Jobs changed the world at Apple – he did, but I argue that Mitchell’s genius was far more profound, and in the end will do much more for the world than Jobs, Gates, or Buffet has done.
Yankee ingenuity? In truth, give credit to one Petroleum Engineer from Texas A & M, who everyone thought was crazy, and who turned the energy world upside down.
And that’s how the world is changed – not by governments, but by one man with a vision, and the courage to make his vision real.
It also amuses me to note (and I did extensive field work in oil and gas in the 80’s & 90’s, and this is what I was taught at the time) that it’s safe to say that before George P. Mitchell came along, the “Consensus” of 99% of the Petroleum Engineers, Reservoir Engineers, and all associated geophysical scientists worldwide, was that commercial quantities of oil and gas could *Never* be produced from shale reserves (although everyone knew they were there) because the permeability barrier inside those formations was impossible to overcome.
George P. Mitchell was just crazy enough to look at the situation and say “you know what? That’s not impossible, in fact I can do it.” And then he did it.
@Janice Moore
FANTASTIC!
AGW is dead. Hurrah! Hurrah! Oooohhhh, huuuurrrah!!!
Celebrate the TRIUMPH OF TRUTH with a song
by an Italian (Rossini) about a Swiss hero (Tell) using Chinese fireworks
(viewed on a little device that is yours compliments of …
Yankee Ingenuity (Edison and Bell and Gates, et. al. — (smile))
Er, the Brits had more than a hand in inventing the computer, and also the World-Wide Web that the video is traveling over. If you’re using an LED screen, they were first created by a Russian – if CRT or LCD, look to the Germans or the Brits again.
But I agree that American enterpreneurs have made the personal computer into a ubiquitous standard… oh, and Bell was Scottish…
Col Mosby
+10
Much of the drive for “sustainable” energy is based on progressive Utopian thinking that denies economic reality and is by its very nature not economically sustainable. The greater the subsidy, the sooner that governments will get politically exhausted to justify and continue. When subsidies (either direct or indirect), decline, any energy source will be forced to compete economically with its peers and the pressure will mount for use of the best source available.
I mourn for all the money this false religion has cost us. The median household income is $50,000. For every million dollars wasted, we consume the income of twenty median households, for every billion dollars, the income of 20,000 median households. Worse, much of this money was created out of thin air by creation of debt, and debt that we never intend to repay, even as our children will be born into debt serfdom merely to pay the perpetual interest.
One of my fears is that as wind power is shown to be horribly expensive, that wind turbines will be abandoned and be to the 21st century ecology movement what abandoned open pit mines were to 19th century capitalism.
Attended a meeting on energy policy. Lots of talk about oil and the surprise of the fracking rise. Lots of talk about more solar and wind subsidies for el electricity generation. Little understanding that we use natural gas not oil to generate electricity.
If the USA can claim a little pride of place its that we still have just enough political freedom left to embrace the surprises. That is the core of this fight. I know that those posting here from other countries are fighting for the same.
What I don’t understand is why the TAN (Guggenheim Solar ETF) is up 192% from Jan 2013??
wws says:
March 2, 2014 at 6:40 am
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Nice post and thank God for Greek immigrants.
J Martin says:
March 2, 2014 at 1:38 am
I agree entirely. Unfortunately, we have a suicidal hysteria regarding any form of nuclear energy. Since Fukushima, you can’t even begin to discuss the topic rationally. India will show the way.
Reblogged this on Power To The People and commented:
The real harm to the environment is not Fossil Fuel it is Wind and Solar which should be stopped immediately. Just look at the land use issues involved in current wind and solar energy initiatives in the US for example. They are so horrific that they might be accurately described as a war on nature. If one does the math the US would have to dedicate 500,000+ square miles or approx. 15% of her entire land mass to solar to provide all of the US energy needs. Wind is no better. Wind energy providers in the US provide between 25 and 50 acre buffer zones for each wind mill and many of these wind farms are gobbling up prime farmland in the process; reducing America’s ability to produce food. Bottom line wind and solar are not ready for primetime; Kill thousands of birds, bats and eagles and Devastate the once idyllic deserts of California and Arizona where birds are literally burned alive in flight http://www.examiner.com/article/green-energy-solar-farm-cooks-birds-mid-flight over the vast array of solar panels that scar the Desert. Anti fossil fuel activists like President Obama, Tom Steyer and Tim Cook need to stop their war on fossil fuel and the devastation to Nature and Humanity caused by Wind and Solar they are advocating in the name of “saving the planet from climate change”.
Climate Change Is Not The Problem. Fuel Poverty Is. http://wattsupwiththat.com/2013/03/15/james-hansens-policies-are-shafting-the-poor/
Higher Fuel Prices = More Poor People = More Children Dying.
Jimbo says:
March 2, 2014 at 3:32 am
The USA maybe hell bent on closing its coal fired power stations but COAL MINING and exports continue. Where do you think that coal goes to? Answer: China and other Asian nations.
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The EPA is big on cutting CO2 production in the US by closing coal powered electrical production. This reduces the demand for coal in the US, making export coal cheaper for the Chinese to buy, lowering their cost of electrical production and thus lowering their cost of manufacturing.
By reducing the cost of Chinese manufacturing, the EPA is exporting jobs to China. The CO2 that was being produced in the US will now be produced in China, where the winds will return it to the US in a week of so. The jobs however will not return so readily.
So, in the end EPA policies will affect jobs much more than they affect CO2.
Fracking is only part of the story. The real breakthrough is Smart Drilling. Fiber optics sensors are fed down the drill shaft as drilling progresses. Coupled to computers, these provide 3-D seismic images from thousands of feet underground to guide the drill bit to promising formations. This improves yields, which improves the efficiency of exploration.
It is the rate of change in efficiency that is key to the process. People talk about falling prices for solar panels. Oil and gas extraction costs are falling much faster, thus the boom.