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Governor Palin – How Big Oil went from friend to foe in Alaska

David Parkinson, Globe and Mail
By her words, Sarah Palin is a proponent of drilling. But by her actions, she’s no great friend of the drillers.

In her rousing speech Wednesday night to the Republican National Convention, the Alaska governor – and vice-presidential nominee – talked passionately about the need to drill for new oil and natural gas sources on American soil.

“We cannot leave ourselves at the mercy of foreign suppliers,” she said.

Yet in her oil-rich home state, Ms. Palin has set herself up as an enemy of the very companies who would lead the drill-bit charge.

Since moving into the governor’s mansion 21 months ago, she has portrayed herself as the people’s defender against Big-Oil greed, and backed it up with policies that critics say have alienated the state’s major oil interests and threatened to stall energy investment.

Ms. Palin has raised taxes on oil profits and given cash rebates to consumers – an idea her presidential running mate, John McCain, has staunchly opposed at the federal level.

… The approach represents a gamble: The oil and gas industry generates roughly 90 per cent of Alaska’s government revenues and about one-third of its gross domestic product. Oil giants who have long wielded power over Alaska’s economic landscape – Exxon Mobil Corp., ConocoPhillips Co. and BP PLC – now find themselves at odds with the administration.

“We have major policy differences,” said one Alaskan oil official.
(5 September 2008)

Drilling For Clean Energy

Jim Marshall and Roscoe Bartlett, Washington Post
The controversial bans on drilling offshore and in the Arctic National Wildlife Refuge have preserved precious oil and natural gas reserves owned by the public. Thank environmentalists for this unintended gift.

But for these bans, we would have wasted the reserves without a strategic plan. Leasing and drilling would have lowered world oil prices by a few cents, benefiting more foreign consumers than Americans. The federal revenue from royalties, lease payments and taxes would have been used to meet current federal expenditures. And our remaining publicly owned oil and natural gas would be substantially depleted. Consequently, our dependence on foreign energy sources would be even greater than it is — and it is likely that the current commodity price crisis would be worse.

We hope this price crisis prompts the adoption of a strategic plan to use the remaining value of our federally owned oil and natural gas reserves to fund a clean, affordable and independent energy future for America, a goal worthy of short-term environmental concessions and risks. Virtually all general drilling bans should be lifted. We should permit drilling offshore and in the ANWR and require that it be done with appropriate care.

Before granting additional drilling rights, however, we should fundamentally change the terms of future oil and gas lease agreements to ensure that taxpayers capture more of the revenue from our remaining reserves.

Jim Marshall, a Democrat, represents Georgia’s 8th District in the U.S. House. Roscoe Bartlett, a Republican, represents Maryland’s 6th District.
(5 September 2008)

LaDuke emphasizes global warming in welcome address

Miriam Berger, Westleyan Argus
Renowned environmentalist and activist Winona LaDuke welcomed students this year by passionately urging them to think critically about the current global crisis of climate change and the connection between their lives and the environment.

LaDuke, an Anishinabe member of the Makwa Dodaem, or Bear Clan, which is on the White Earth reservation in northern Minnesota, is nationally respected as a champion of the environment and of American Indians.

… LaDuke continued to address “peak oil” and energy, critiquing the Bush administration’s support of “clean coal” and nuclear power. She insisted instead that more time and money should be invested in renewable energy.

“It turns out that you can only invade so many countries for oil. We have to come to terms with the fact that we can’t mine fossil fuels anymore,” she said.

On food security, LaDuke spoke about the danger of genetic engineering and the corporate concentration of seed types.

“The question of who now owns [seeds] has become a question of seed slavery,” she said, describing the unsustainable agricultural practices she sees advocated by today’s society.

LaDuke went on to explain how her tribe researched their energy consumption and discovered that they could dramatically reduce their fossil fuel use and energy costs by installing solar heating panels and wind turbines.

“Now every reservation in Northern Minnesota wants a wind turbine,” she said.

By working to retool the local economy of her reservation, LaDuke hopes to reduce the distance members must travel to find work. She also advocates the use of heirloom seeds and the support of local and organic food production systems, which are not dependent on fossil fuels and are also more nutritious.
(5 September 2008)

Riding the wind with T. Boone
Rolf E. Westgard, Energy Bulletin
Just when all seemed lost on the energy front, Texas oil billionaire T. Boone Pickens blows into town with the Pickens Plan. That plan would replace the 800 billion kwh produced annually in the U.S. by natural gas power plants with power from wind turbines. The gas thus saved would then be available to fuel our cars and trucks with compressed natural gas(CNG), replacing billions of gallons of gasoline annually.

Wind farms typically operate at a 25-30% capacity factor, so upwards of 400 gigawatts(GW) of wind capacity would be needed. That’s 200,000 giant 2 megawatt(MW) turbines at a cost of about $800 billion in today’s dollars. In addition, a massive addition to our high voltage transmisson network will be needed to carry this energy from sparsely populated windy areas to population centers. The Pickens Plan estimates anoher $200 billion nationwide for these transmission links.

There is another issue which relates to wind’s variability. Natural gas plants can be used as either base load plants, running all the time, or as peaking plants, turned on quickly by the grid manager as needed. Peak loads occur late in the day and on those hot sultry summer days when air conditioners run, and there isn’t a ‘breath of air’. Wind turns itself on and off, whether the grid needs it or not.

Denmark’s electric grid is widely reported to get 20-30% of its fuel from wind energy. It doesn’t. Denmark’s 5300 turbines do produce about 20% of Denmark’s total electric demand, but then Denmark has to look around for somebody to buy the wind power, as the grid can’t use most of it at the time it is generated. The buyers are Norway, Sweden, and Germany who pay less than Denmark’s cost.

Countries like Germany, Denmark, and Spain have seen massive subsidized investments in wind power. but they are finding that achieving more than 10% wind in a large electric grid is very difficult, as wind tends to blow when least needed. They are also finding that new wind capacity requires new natural gas plant backup of 50 to 80% of the installed wind to cover when wind is too light or too strong for the turbines to function.

CNG is a relatively clean and economical fuel for motor vehicles, but it requires special compressed gas fueling facilities which are rare in the U.S. CNG works best for fleets which can be serviced from central fueling stations. Until recently, flat to slightly declining gas production in North America has raised the prospect of large imports of liquid natural gas(LNG). New discoveries in domestic shale fields are now bringing 5% increases in gas production, but even that won’t be sufficient to fuel large numbers of cars and trucks without more LNG imports.

Finally, wind installations are subsidized with a production tax credit of 1.8 cents per kwh. This credit would provide the Pickens Plan 4GW wind farm with about $800 million over ten years, leaving the taxpayer, and perhaps the rate payer, twisitng in the wind.

Rolf E. Westgard
Deerwood, MN 56444
(professional member, Geological Society of America
(5 September 2008)