News Cut Category Archive: Energy

Coal ash dumps in Minnesota

Posted at 3:41 PM on September 8, 2009 by Bob Collins (2 Comments)
Filed under: Energy

Remember this? It's the coal ash spill in Kingston, Tenn., in December 2008. When an earthen dam gave way, more than 1 billion gallons of gray, toxic sludge inundated hundreds of acres.

It prompted the Environmental Protection Agency to find out how many sites out there are holding the toxic leftovers -- coal ash -- from the nation's power plants.

Now, the results are in. The EPA says there are 600 of them spread around 35 states. Four of the sites are in Minnesota.

Black Dog Generating Plant, Burnsville
Has four holding ponds, but only one has small amounts of coal ash, according to Xcel Energy. The company says it could find no evidence the dikes at the ponds were built with the help of a professional engineer. There has been no federal or state inspections.

Riverside Generating Plant, Minneapolis
It's in the process of being converted from coal to a gas-fired facility. A pond on the site will be eliminated this year or next. It contains a small amount of ash particles, the company said.

Sherburne County Generating Plant, Becker
The plant uses three ponds for coal ash from three plants. One is being closed and capped and the water is being pumped out. They were designed by a professional engineer, and the Department of Natural Resources inspected the operation in June 2008. The company says it has found no evidence of spills to water in the last 10 years, and two released to land over that time.

All of these are owned by Xcel. Here's the documentation submitted to the EPA.

Minnesota Valley Generating Plant, Granite Falls
Xcel reported the plant is not operating and hasn't generated "significant" amounts of coal ash for more than 10 years. When it does, four ponds are used. It says it could not locate records of a professional engineer being used, nor records of the ponds being inspected. It says it knows of no known spills but says the ponds were flooded in the Minnesota River floods of 1997 and 2001 and coal ash could have been carried away.

Here's the documentation on this plant.

There is no regulation of the residue produced by coal-burning power plants.

In a 2007 article, Scientific American said the the waste produced by coal plants "is actually more radioactive than that generated by their nuclear counterparts. In fact, the fly ash emitted by a power plant--a by-product from burning coal for electricity--carries into the surrounding environment 100 times more radiation than a nuclear power plant producing the same amount of energy."

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Exit the light bulb

Posted at 4:32 PM on August 31, 2009 by Bob Collins (13 Comments)
Filed under: Energy

If you want to see the future, look toward Europe.

On Tuesday, the ban on incandescent light bulbs begins in the EU, the New York Times reports. It's part of an attempt to limit greenhouse gases but the debate continues over whether the cure is just as bad.

The U.S. is headed toward a similar de facto ban. I wrote about it in the infant days of News Cut. (And here.)

Any substantive conversation about the U.S. ban disappeared when Rep. Michele Bachmann filed a bill to delay implementation, not so much because there aren't some legitimate concerns about the replacement, but -- let's face it -- because it was Michele Bachmann.

But there are some concerns about the CFL bulb, even beyond the mercury content. Stick one in your garage door opener bulb socket sometime. It doesn't last very long. I tried. Several times. What about the little light bulb in your fridge? Or your oven? Or work lights (Don't talk to me about those LED work lights; I tested one of those -- for $35 -- this year and next to the day I got married and the day my children were born, the day I tossed that junk in the trash was the happiest day of my life)? CFL bulbs have improved, but not by a lot. LEDs may be the answer in some applications -- autos, traffic signals, Christmas lights -- but not a lot of everyday ones.

There maybe be a solution on the way. NPR has the story this evening about a firm that is making a hybrid incandescent bulb that uses less electricity than the the CFL. Expensive? You bet.

But back to the UK for a minute. The government has asked people to keep an eye on shopkeepers who still sell incandescents. Some are said to be importing the "illegal" bulbs from China. And that brings up another likely problem when it disappears from the U.S. scene -- the underground bootlegged incandescents. Incandescent speakeasies. Mysterious men in overcoats who whisper, "Psst, buddy. Want to buy a light bulb?"

Which is why I'm stocking up. It could be the answer to my 403B woes.

(Light bulb photo above:

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Taxed by the mile

Posted at 11:43 AM on July 20, 2009 by Bob Collins (13 Comments)
Filed under: Energy

Just when Minnesota raised its gas tax for the first time in more than 20 years, the gas tax may be heading for the ash dump of history.

That's probably overstating the future a bit but momentum is increasing to charge people based on the number of miles they drive. The University of Iowa has been given a federal grant to determine whether billing people for the miles they drive makes more sense.

The problem with the gas tax is cars are getting better mileage and people are driving less because of high prices.

There's money to be made here. The project is looking for people to participants in the 10-month study. Small computers will be attached to their cars and they'll be sent mock invoices. They'll also make up to $895, the Chicago Sun Times reports today. Unfortunately, Twin Cities or Minnesota drivers aren't part of the study.

The study is also another example of the left hand not knowing what the right hand is doing. The federal government has given the university the money to study the idea. President Obama has already said he won't pursue it.

But the idea could become the new census. The primary opposition to it comes from privacy interests. "There is a real concern on the part of many in the public that this is the ultimate of Big Brother watching and knowing where you are," says Kansas Transportation Secretary Deb Miller.

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Business group: Raise taxes

Posted at 4:03 PM on July 15, 2009 by Bob Collins (0 Comments)
Filed under: Energy

My MPR colleague, Bill Catlin, has forwarded what appears at first glance to be a stunner story from Dow Jones. The U.S. Chamber of Commerce is calling for an increase in the gas tax. Business and tax increases are not long-time allies.

"Just damn do it," Chamber President Thomas Donohue said Wednesday at a news briefing. According to a press release from the pro-business group, "he called on Congress not to delay action on a new highway bill as the Obama administration has proposed. Wednesday, the Senate Energy and Public Works Committee backed a plan to put off debate on new highway funding for 18 months, extending current funding levels until then."

The federal tax hasn't been increased since 1993. Washington lawmakers are worried about the political backlash of a gas tax increase. To recap: Politicians don't want to raise taxes; a business group does.

But it may not be that unusual for the Chamber and the gas tax to be friends. When the Minnesota gas tax was raised by the Legislature in 2008, it only gained traction after the Minnesota Chamber of Commerce endorsed the idea. It took cutting the size of a proposed increase in the metro sales tax in the transportation bill, though, to get the chamber on board, however.

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How to get weatherization help

Posted at 12:33 PM on July 9, 2009 by Bob Collins (0 Comments)
Filed under: Economy, Energy

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Soaring gas prices

Posted at 2:35 PM on May 27, 2009 by Bob Collins (8 Comments)
Filed under: Energy

Gas prices rose 20 cents in the Twin Cities area on Tuesday, a day after dropping 6 cents. The top price in these parts is $2.59 a gallon, a 31-percent jump from a month ago, and well ahead of the nationwide 19-percent increase.

The price of a barrel of oil has jumped almost 79% so far this year. It comes as analysts say the demand for gasoline is still dropping.

What's going on?

According to a report from McClatchy, big investment houses are bidding up the price, in anticipation of the economy turning around.

Big Wall Street banks such as Goldman Sachs Group Inc., Morgan Stanley, and others are able to sidestep the regulations that limit investments in commodities such as oil, and they are investing on behalf of pension funds, endowments, hedge funds, and other big institutional investors, in part as a hedge against inflation.

A year ago, Minnesota -- what with its blend of ethanol and all -- had the lowest prices in the nation. This year, however, the Upper Midwest is among the higher-priced regions.

Jim Ritterbusch of Ritterbusch and Associates said gasoline prices could be back down to nearly $2 a gallon by the end of summer.

(Photo: Tom Weber)

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Gas prices jumping

Posted at 1:24 PM on May 11, 2009 by Bob Collins (3 Comments)
Filed under: Energy, Politics

Despite what the weather might suggest, there must be a summer coming. Gas prices are heading up in a hurry.

In the Twin Cities today, the price of a gallon jumped about 20-cents-a-gallon, to about $2.39 in some locations, still lower than the $3.61 of a year ago, but we might get back there soon enough.

It was July 2005, when we visited these levels for the first time. The state had shut down over a budget dispute between Gov. Tim Pawlenty and the Legislature.

Coincidence?

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The end of $2 gas

Posted at 11:51 AM on May 5, 2009 by Bob Collins (1 Comments)
Filed under: Energy

The major retail gasoline outlets -- SuperAmerica, BP, and Holiday -- raised the price of gasoline to $2.19 today. That's still way below what it was a year ago, of course, but it's still a 16-percent increase in the last week.

Apparently, it's the "optimism thing."

"With the outlook for risky and pro-growth assets continuing to improve (particularly as U.S. equity markets turn positive for the year), we are growing more constructive on energy markets," technical analysts at Barclays Capital told the Dow Jones Newswire. Translation: It's a good time to raise prices and make some dough.

The Associated Press also reported that easing fears about the flu also have contributed to higher prices.

Was last week the last time we'll see gasoline for under $2?

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Flip-flopping on ethanol

Posted at 5:02 PM on April 2, 2009 by Bob Collins (3 Comments)
Filed under: Energy

Time to hit the wayback machine again.

"Corn and ethanol production and the resulting high prices will impact the world in a much more acute negative way than greenhouse gas emissions and climate change ever will," Valero Energy Corp Chief Executive Bill Klesse told an oil group last March in San Diego. "All of these programs are just a huge transfer of wealth from our industry to the Midwest farms."

That was before Valero bought the VeraSun ethanol plants in Minnesota and other states in the Midwest. Today, the company announced it intends to run them at full throttle.

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The vanishing signs of spring

Posted at 8:49 AM on March 7, 2009 by Bob Collins (3 Comments)
Filed under: Energy, Weather

The vanishing signs of spring.

When I was growing up, the New England Flower Show was the unofficial declaration of hope during that part of the winter -- the tail end -- when one more helping of snow would often be enough to send people over the edge.

Now, the New York Times reports today, flower shows across the country are the latest victims of the bad economy. They have wilted in the face of reality.

Last week, my wife went in search of bulbs to force. All she could find was "paper whites," the smell of which instinctively makes us look for an electrical fire in the house. She had no luck finding regular old bulbs.

Need more? For baseball fans, pouring poring over the small agate type box scores of spring training games from exotic places like Port St. Lucie and Winter Haven, has always been the "hope" to hang onto. The Star Tribune, and many other places, this year have eliminated out-of-market spring training linescores. Getting them via the Web is not the same.

This weekend it's supposed to snow again.

Hope is getting harder to find.

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End of the road for nuclear storage?

Posted at 2:42 PM on March 3, 2009 by Bob Collins (3 Comments)
Filed under: Energy

President Barack Obama presented quite the "to do" list when he released his budget last week. This one may be among the most challenging: Finding a place to put all the nuclear junk the nation's nuclear power plants are creating.

Obama's budget has scaled back funding for the proposed Yucca Mountain nuclear waste repository. It doesn't say how much it's scaled back, only that the feds will spend money on the Nevada mountain project "to those costs necessary to answer enquiries from the Nuclear Regulatory Commission, while the Administration devises a new strategy toward nuclear waste disposal."

Nuclear proponents have hoped for years that Yucca Mountain would be the answer to the #1 problem plaguing the nuclear industry.

The waste is piling up, of course. In Minnesota, the Prairie Island nuclear plant's waste has been stored in dry casks for years. Over the years the Legislature has approved additional storage there, over the objections of the Prairie Island Mdewankanton Dakota Reservation. The current capacity will run out between 2013 and 2014.

Xcel Energy built a three-acre facility at its Monticello plant, to store spent fuel in steel containers inside concrete vaults.

Both locations are going to be around for awhile, judging by a May 2007 letter to the Las Vegas Review-Journal that might be the solution for the foreseeable future. " I believe a better short-term solution is to store nuclear waste on-site at the reactors where it is produced, or at a designated facility in the state where it is produced, until we find a safe, long-term disposal solution that is based on sound science."

The contractor that was developing Yucca Mountain saw the end coming. Last month it laid off half of the 1,100 employees at the site.

It was supposed to open in 1998.

The Nuclear Regulatory Commission currently has 17 applications for 26 new nuclear reactors in the U.S.

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Cellulosic ethanol gets a boost

Posted at 7:20 AM on February 3, 2009 by Bob Collins (7 Comments)
Filed under: Energy

The blogs and bulletin boards are sure to be buzzing today with details of the University of Minnesota study on ethanol. It was billed in the Star Tribune as a study that showed corn ethanol no better than gasoline. That's true, but the substance of the study showed that cellulosic ethanol is.

According to a news release from the U, "the authors found that depending on the materials and technology used in production, cellulosic ethanol's environmental and health costs are less than half the costs of gasoline, while corn-based ethanol's costs range from roughly equal to about double that of gasoline." The full study won't be available online until next week.

Cellulosic ethanol is made from plant and tree fiber.

Two years ago, the same U of M researchers determined that ethanol "delivers 25 percent more energy than is used (mostly fossil fuel) in producing it, though much of that 25 percent energy dividend comes from the production of an ethanol byproduct, animal feed."

A company in Minnesota is testing cellulosic ethanol production and has been meeting with farmers to figure out a method of collecting the material that could be used. But the process may not be able to compete with grain-based ethanol in five to eight years, according to Minnesota Public Radio's Mark Steil.

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The LED solution?

Posted at 5:05 PM on January 30, 2009 by Bob Collins (6 Comments)
Filed under: Energy, Science

The Brits are further ahead of us in the development of the next generation of light bulbs. They've banned the sale of incandescent light bulbs, and they're already -- reportedly -- moving past the newfangled CFL bulbs.

The next step is LEDs. I bought one of those LED worklights a year or so ago and it's heading for the trash. The light, while cheaper to produce and relatively bright, is too narrowly targeted as a work light and certainly as a replacement for home light bulbs.

So I was interested today when the BBC reported that a professor has developed an LED light bulb that will last for 60 years and be appropriate for home use. Alas, it was a most disappointing presentation.

It's easier to develop an eco-friendly light bulb than it is to develop an eco-friendly light-bulb that works well.

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Media layoffs

Posted at 10:51 AM on December 31, 2008 by Bob Collins (10 Comments)
Filed under: Disasters, Energy, Media

The axe is falling on more media personalities.

Nat Hentoff was let go yesterday by the Village Voice, so everyone pretty much knew firings were coming at City Pages, which is owned by the same company.

Bingo.

James Norton and Assistant A-List editor Ben Palosaari have been let go, according to media analyst David Brauer at Minnpost. He also notes that WCCO-AM has dismised overnight talk host Al Malmberg and his fill-in, Brad Walton.

One of the questions for 2009? Is there any local media that will escape the budget-cutting axe?

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$2 gas

Posted at 11:03 AM on November 7, 2008 by Bob Collins (8 Comments)
Filed under: Energy

"They" said we'd never see it again, but while we were otherwise preoccupied this week, the price of a gallon of gas in Minnesota fell below $2. It's below $1.90 in some locations today, according to twincitiesgasprices.com.

If you changed your driving habits when it shot up to near $4, are you changing your habits back now?

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Gas prices from both sides

Posted at 12:45 PM on October 29, 2008 by Bob Collins (5 Comments)
Filed under: Energy

Gas price perspective:

Nearly a third of Americans are cutting back on vacation and travel plans for later in the year, and 27 percent are cutting back on eating out because of record-high gas prices, a retail survey found Tuesday.
-- CNN, 5/19/04 when gasoline hit $2 a gallon .

It is worth repeating that based on price moves that have already happened, the average household is going to reduce its spending on fuel, including transportation fuel, by $4,800 per year. Include the savings to the consumer from price decreases of other raw materials and the average household will spend $12,000 less in the next 12 months. This $12,000 increase in the family budget will not be taxable income, it is more like found money.
-- Seeking Alpha. 10/28/2008 "Relief is on the Way."

The average price of gasoline in Minnesota today is $2.20, but there are plenty of stations selling it for as low as $2.04, according to MinnesotaGasPrices.com.

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The price of gasoline

Posted at 9:48 AM on October 15, 2008 by Bob Collins (9 Comments)
Filed under: Economy, Energy

Anyone who was in the middle of sipping a cup of coffee last June when Rep. Michele Bachmann said just signaling an intention to drill for oil could bring back the days of $2 a gallon gasoline, probably spit most of the java out. It was that crazy a prediction at a time when the average price for gasoline was over $4 a gallon and, apparently, heading higher.

This morning, one energy analyst predicted the rapidly falling price of crude oil would yield a further drop of 60 cents a gallon at the gas pump. With the low end of gas prices in Minnesota today around $2.57, you don't have to be Paul Krugman to do the math correctly.

Voila! Two-dollar-a-gallon gasoline.

In politics, it doesn't matter whether you're right by accident or by design, you get to still say you were right. Politicians did nothing more than talk about drilling, and the price of gasoline is headed for $2 a gallon.

Of course, gas prices are falling because of a worldwide recession that's put enough people out of work, shuttered enough factories, and cut the demand for oil. The law of supply and demand still works. The cure for high oil prices, as the saying went, is high oil prices. Never mind the consequences or the collateral damage.

The situation illustrates a different truism: Economic predictions are almost as worthless as a TV weather forecast.

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Gas prices

Posted at 8:55 AM on October 9, 2008 by Bob Collins (9 Comments)
Filed under: Energy

It's funny how time changes the context of things. I passed a gas station last night and the price of a gallon of gas was $2.96. After $4 a gallon, it was like seeing a sign for free kittens. Funny, it wasn't that way the last time gas was this "cheap."

According to minnesotagasprices.com, the average price in the state for a gallon of gas is $3.019, and there are plenty of stations listed where gasoline is selling in the $2.85 range.

The last time the average price for gasoline in the Midwest dropped below $3 a gallon was February 2008, according to the Department of Energy. A year ago it was $2.74.

The recession is one reason for the drop. We also changed our driving habits because of the high prices. Will we change them back now that the price has dropped?

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The gas tax

Posted at 1:23 PM on September 30, 2008 by Bob Collins (4 Comments)
Filed under: Economy, Energy

According to Twin Cities Gas Prices, the average price of a gallon of regular gas this afternoon is $3.36. Does it feel like a bargain to you compared to what it was a few weeks ago?

How about $3.12? Would it make you start whistling Happy Days Are Here Again?

3.12, for the record, was the price of a gallon of gasoline when the first installment of the increased Minnesota state gas tax went into effect last spring. Minnesotans responded by pumping fewer gallons in April than they did in March.

Tomorrow, the other shoe drops when the gas tax goes up another 3 cents. Last week, at a transportation forum in Worthington, Margaret Donahoe, executive director of The Transportation Alliance, said the financial impact of a two-car family will be about $100 a year

And, the Worthington Daily Globe, the "us against them" atmosphere that has surrounded transportation funding debates in the state for years, hasn't melted...

... commented Rep. Doug Magnus, rural Minnesotans are paying more than those in the metro area. He cited numbers indicating that southwest Minnesotans will pay an estimated $216 per capita in gasoline and special fuel taxes by 2011, while the Twin Cities metropolitan area faces $147 per capita for the same year.

A seven-member panel of politicians and candidates said they were grateful to be taking the first steps in the form of Chapter 152, but emphasized the importance of finding more funding for the state's infrastructure.

"When my family moved here in 1957 all the roads in Iowa were narrow and the roads in Minnesota were wide," said Al Kruse, a candidate for the U.S. House of Representatives in District 21A, "In the last 50 years everyone else has moved ahead and Minnesota has remained stagnant. Our infrastructure is falling farther and farther behind. (Fixing infrastructure is) important for our economic survival. That's just to survive. To thrive we need four-lanes. You see what happens around a four-lane highway -- there's economic development there."

Republicans thought the gas tax issue would anger people enough to carry over at the polls. But that was before overnight swings of 30 to 40 cents a gallon made 2 or 3 cent jumps seem like small potatoes.

With the increasing price of energy, the gas tax funding mechanism faces the same pressures the state's tobacco tax -- or fee -- presents. On the one hand, market forces or the state itself are encouraging people not to smoke -- or drive -- and on the other hand, the state's financial health depends on them doing both.

At least where the price of gasoline is concerned, Minnesotans will have plenty of incentive to cut back. T. Boone Pickens predicted this morning that a barrel of gasoline will be back close to $150 within a year.

And 3 cents a gallon will seem like small potatoes again.

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Refine, baby, refine?

Posted at 1:01 PM on September 15, 2008 by Bob Collins (7 Comments)
Filed under: Energy

The price of gasoline jumped by 40 cents a gallon over the weekend because of a hurricane that didn't even make the leaves rustle in these parts. Why? Because 30 percent of the U.S. oil refining capability is offline.

Hurricane Ike forced the refineries along the Gulf Coast to shut down. The lack of refinining capability coupled with an already short supply of fuel has caused the price run-up according to the Web site, The Oil Drum, which sees the 10-day shutdown causing price hikes and shortages at least into October.

I have said that it is likely to take a week or two to get refinery production up to pre-Ike levels. Suppose it takes 10 days. Adding 10 days to the date of the hurricane (September 12) brings us to September 22. If it takes an average of 18.5 days to get product from Texas to New Jersey by pipeline, it will take until approximately October 10 before supplies are back to normal. It could be a little shorter than this, or quite a bit longer.

Of the 15 top-producing oil refineries in the United States, only four are located in hurricane-safe areas. One of them is the Flint Hills refinery along the Mississippi River in Minnesota. That refinery is ranked #12 in the country.

Some politicians have argued for an easing of regulations to allow more refineries to be built. But Ralph Nader's Public Citizen says it's not environmental regulations preventing new refineries.

From 1975 to 2000, the U.S. Environmental Protection Agency (EPA) received only one permit request for a new refinery. And in March, EPA approved Arizona Clean Fuels' application for an air permit for a proposed refinery in Arizona. In addition, oil companies are regularly applying for - and receiving - permits to modify and expand their existing refineries.[1]

And even the oil industry admits that just because a new refinery hasn't been built in over 30 years, doesn't mean refining capacity hasn't increased. Says a Political Fact Check on the St. Petersburg Times Web site...

The industry has found it costs less money and takes less time to expand existing facilities, he said. Over the past 15 years, the U.S. refining industry has added the equivalent of one new, state-of-the-art refinery a year, each with a capacity to refine 150,000 to 300,000 barrels per day.

A new significant oil refinery hasn't been built in the U.S. since 1976, but smaller ones have been. And South Dakota may be the next lab rat to see how easily a major refinery can be constructed. In June, voters -- thanks mostly to the votes of those in populated areas -- approved rezoning some rural county land for a new refinery.

Last week, a South Dakota agency approved a draft air quality permit for the project.

According to Hyperion's application, the center each year would emit nearly 2,000 tons of carbon monoxide, 773 tons of nitrogen oxides, more than 1,000 tons of particulate matter, 863 tons of sulfur dioxide and 473 tons of volatile organic compounds.

But that's not what has many opponents working -- against long political odds -- to prevent the refinery. They say the oil to be refined is what will cause the most environmental damage.

Largely overlooked in the discussion has been the source and type of crude oil -- Canadian tar sands -- to be refined at the Hyperion facility. Canadian tar sands are probably the dirtiest source of oil on earth, and mining tar sands has created what might be the most polluted area in North America. Tar sands development in northeast Alberta has devastated 180 square miles of boreal forest. The process uses prodigious amounts of fresh water, and much of the water ends up so toxic it kills any wildlife that touches it. Millions of gallons of this poisoned water are now impounded in hundreds of toxic lakes and ponds.

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After Ike

Posted at 8:50 AM on September 13, 2008 by Bob Collins (4 Comments)
Filed under: Energy, Weather

Hurricane Ike has come ashore in Texas and done its thing. Now, the rest of the country waits for answers for two questions: (1) Is everybody OK? and (2) Will the price of gasoline go up?

The largest oil refinery on the continent is in Galveston and it's shut down. Later today, inspectors will take a look at it to see how soon it can be restarted.

The Oil Drum Web site has been trying to estimate the effect at the pump based on the shutdown and damage. It has a Flash map which shows Ike's path, and what was in its way. The red area below shows area of damage.

All of the icons are some facet of the oil infrastructure. The area produces 6 percent of the world supply.

The Twin Cities' gas prices are already heading up, according to twincitiesgasprices.com -- about 3.5 cents locally since Friday and about 8 cents nationally.

Update It appears the major gas stations have increased prices 30-40 cents a gallon today.

It's worse in other parts of the country where drivers rushed to fill up their cars, figuring there'd be a gasoline shortage.
Some gas stations in the southeast raised their prices by more than $1 a gallon, although much of that was because of the panic more so than the law of supply and demand.

Until the wind and the fear subsides, we won't know for sure how much Ike is going to hurt.

In the meantime, hurricanetrack.com is an excellent resource for following Ike. This webcam is mounted in an SUV patrolling the region.

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An ill wind?

Posted at 1:53 PM on September 11, 2008 by Bob Collins (15 Comments)
Filed under: Energy

A commentary in the Sioux Falls Argus Leader this week makes an interesting point on the infrastructure required for wind energy:

Wind power has, among other faults, two major drawbacks: Most wind power will be generated in the middle of the country although most of the power is needed in the more densely populated areas near the coasts. This requires long transmission lines. Engineers tell us that normal transmission lines of 138 kilovolts or 345 kV lose 10 to 15 percent of their wattage over 1,000 miles. Therefore, a completely new and very expensive system of 765 kV transmission lines that will not lose power over long distances will be needed.

There's that. And then there's this: Wind energy is a spectacular blight on America's landscape. I noticed this most recently while flying into Denver a few weeks ago. Colorado has a lot of windmills.

So does Minnesota and, as the blog, Perfect Duluth Day found recently, so does Iowa.

A short distance over the state line, we saw windmills in the distance. They were far away but could be seen clearly. You could tell they were enormous. Scary big.

I kept saying things like, "They're freaking me out!" and "Those are so scary!" Of course, I said, too, "Those make a lot more sense than digging up coal to burn it," but mostly, I was freaked out.

Perhaps we headed down this road with our reliance on cellphones. There are few scenic vistas left that don't include a tower. And, let's face it, we city slickers don't much care about what's out on the prairie until we actually go there. But is there any way to utilize wind and still have an America that's beautiful?

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The world by scooter

Posted at 12:32 PM on August 21, 2008 by Bob Collins (6 Comments)
Filed under: Energy, Surveys and trivia

It's not that I don't love my job; I do. But I always marvel at the folks who undertake great expeditions without a care, apparently, for having to make a living at it. The various journeys to Antarctica and the North Pole from Minnesota explorers are a couple of examples.

Now there's a third. Two guys are going to spend time riding a scooter from Minnesota to New York City-- and back again. Why? To demonstrate the power of the scooter in the era of high-priced gasoline.

Says the 'expedition's' Web site:

2007, Dustin Saunders moved to Minnesota to seek new opportunities. Once he settled in, the love for his scooter he left in Utah was too much to bear. Dustin then traveled with his friends to Utah to pick it up, and drive the scooter back to Minnesota.

Scooter Quest was originally meant for family and friends to check to see how progress was going as the crew made it back from Utah, to Minnesota. Now, in 2008, Sean, Dustin, and Michael will take their scooters and venture across parts of the United States on an epic adventure of traveling, exploration and fun. The adventure begins on August 23rd, 2008 from Minneapolis, MN ending in New York, NY with checkpoints in Chicago, Indianapolis, and Philadelphia along the way.

Check out their Web site and their plans to stay connected during their journey. They leave in a couple of days.

(h/t: Laura Yuen)

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Prayer at the pump

Posted at 9:08 AM on August 17, 2008 by Bob Collins (6 Comments)
Filed under: Energy

Republican congresswoman Michele Bachmann maintained earlier this summer that just by talking about more drilling for oil, the price of a barrel would come down. Now that oil has come down in price, the political debate is whether that's due to factors including Bachmann's assertion, or whether it's the natural order of the marketplace.

But maybe something else is involved, according to a story on the BBC Web site this morning.

People in the DC area have been gathering around the pumps ... to pray.

This week the group returned to the site of their first prayer meeting to celebrate. Singing "We shall overcome," they changed the words of the well-known hymn to "We'll have lower gas prices".

Mr Twyman is sceptical that market forces might be responsible for the lower prices. But he and his prayer warriors have changed their motoring habits.

"We believe not just in prayer - because we believe that faith without works is dead. So we've encouraged people to car-pool more and organise their days more, because it's a combination of faith with these other factors."

The prayer meetings started in April and, as you can read in the story, the advocates think the price has come down because of their prayer. Maybe, but when they started praying, the price of a gallon of gas was $3.299, according to the Department of Energy. On August 11, it was $3.764.

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The shifting political sands of energy

Posted at 10:59 AM on August 12, 2008 by Bob Collins (6 Comments)
Filed under: Energy, Politics

One's antenna always should go up when a special interest group releases a poll that shows a result favorable to the special interest group. But a poll is a poll and today's comes from the American Petroleum Institute which reports its poll finds 58% of Minnesotans support "increased access" to oil and gas reserves (i.e. ANWR and coastal drilling). Twenty-percent of those people only somewhat support the idea.

Ninety-four percent of those surveyed are "concerned" about the price of gas. Five percent "aren't concerned at all."

The results are pretty much the same as a survey Quinnipiac took in Minnesota last month. In that survey, 59 percent of those surveyed said they support drilling for oil off the coasts. Half of those who said they supported drilling, said they have always held that view; that's a sign of the shifting political sand on the issue.

But in that same survey, 61 percent of those surveyed said they'd rather have politicians focus on alternative forms of energy, than drilling for oil.

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Ethanol: Full speed ahead

Posted at 12:17 PM on August 7, 2008 by Bob Collins (4 Comments)
Filed under: Energy

Sorry Texas, the EPA is just messin' with you. The Environmental Protection Agency today denied the state's request for a waiver on the requirement that oil companies add about 9 billion gallons of ethanol to their fuel this year.

It's the issue that's pitting farmer against farmer. Sure, ethanol is making money for farmers who raise corn, but it's taking some money away from cattle producers who are seeing the price of corn increase their cost of feed.

It's been an emotional issue at FarmFest this week, the Bemidji Pioneer reported today (registration required)

While not opposed to ethanol -- something he uses as a farmer -- (Edgerton Minn., farmer Randy) Spronk said livestock producers are at a disadvantage because federal and state laws now favor using corn for fuel compared to livestock feed. Federal policy "has distorted the corn market," he said.

"Will we have enough corn to produce food and how will these consumers spend their limited food dollars?" he asked.

No one on either of two panels at FarmFest could guarantee that the corn will be available for livestock.

Sitting next to Spronk in one panel discussion was Hector, Minn., farmer Steve Kramer, secretary of the Minnesota Corn Growers Association. He said ethanol use is a relatively small factor in price increases.

"The marketplace will balance out," Kramer predicted. "There is no shortage of food caused by the diversion of corn."

Others object to the environmental fallout from the production of ethanol. And a report cited by the Guardian says ethanol is at the heart of the world food crisis.

Sen. John McCain had called for an end to the ethanol mandate. Sen. Barack Obama is for it.

The administration's pumping up ethanol is good news for agri-giant Archer Daniels Midland, according to the financial Web site Motley Fool.

Speaking of ethanol, management made a few interesting comments on its conference call regarding the market for the much-debated fuel additive. For what it's worth, ADM management stated their optimism that Texas' request for a waiver on the federal ethanol mandate would not be granted... Archer still foresees strong demand. The blending economics are just that attractive, with ethanol providing cheap octane for gasoline. Archer actually cited blending in excess of the mandate.

Even without the mandate, however, some analysts figure ethanol is here to stay because there's too much money to be made producing it, according to the Minnesota-based agriculture newspaper Feedstuffs.

Jerry Gidel, analyst for North American Risk Management Services, said he does not anticipate EPA will change the RFS levels after the recent sell off in corn prices and the nearly 10 billion gallons in current biorefinery capacity. Gidel added the extra renewable identification numbers (RIN) in the marketplace will factor into not changing the RFS, particularly since the current 75-78 cent discount of ethanol will override anything the EPA does, he said. "The economic incentive to blend and make money is too strong for the energy distributors not to use as much ethanol as their updated facilities will handle. The lack of splash & dash facilities is the only reason for any slowdown in what the ethanol industry might be able to produce at current corn prices," Gidel said.

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The lure of wind

Posted at 11:46 AM on August 4, 2008 by Bob Collins (2 Comments)
Filed under: Energy

Today's article in the New York Times on the changing face of Nebraska has us engaging in wind-energy trivia today. The paper points out that Nebraska has made a promotional brochure out of the fact it ranks sixth in the nation in wind energy.

Sixth? Where does Minnesota rank? Third, according to the American Wind Energy Association. It's potential for wind energy places it at #9, however. Minnesota has about 800 wind turbines.

Texas is number one (the state is home to more than 3,000 turbines), and generates about 3-percent of its electricity via wind, according to a February 2008 New York Times story.

In Minnesota, farmers are figuring out how to make money with wind, according to the Litchfield Independent Review newspaper. A series of nine farmer-owned energy companies has kept the money generated by the turbines in the community, rather than shipping it off to a far-away power company.

The most striking change in the industry may not be so much the change to the scenic vistas of the Minnesota prairie and bluff country, but the willingness of communities to construct turbines. This week, for example, Winona County is planning to overhaul its wind and zoning laws.

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Editorial kerfuffle

Posted at 4:31 PM on July 8, 2008 by Bob Collins (6 Comments)
Filed under: Energy, Politics

It's rare these days to hear any real passion coming from the news bosses at the Star Tribune. This is one of those days, however.

MinnPost writer David Brauer took the Star Tribune to task today for not acknowledging in an editorial supporting offshore drilling, that the paper's owners have a financial interest in it.

Worried about spills? "Though some environmental advocates dispute this, drilling technology has advanced over the past quarter century. Oil companies can drill more efficiently in deeper water with significantly less risk to the environment."

But there was one unnoted fact: The company that bought the Strib last year is heavily invested in that technology.

That brought a volley from Jill Burcum of the Strib''s editorial board. Once you get past the invectives, her message in Brauer's comment section was:

The editorial's point remains a strong one - that it's worth having a discussion about offshore drilling in light of $4 gallon gas and advances in drilling technology. This is something that many on all sides of the political spectrum are saying. I'm not going to apologize for advocating for families suffering from high gas prices. Or, asking for a debate over opening up new domestic oil supplies, something our experts agreed would help drive prices down and get speculators out of the markets. If that makes us "breathy," so be it. We're in pretty good company.

As far as disclosure goes, David, heal thyself. By your own standards, your columns require a lot more of them than the meaningless Gray Plant disclosures you put in. Today's reality, which you should know as a critic, is that most media companies have owners with vast investment interests. Do these newspapers, TV stations and other outlets disclose this every single time they write about these topics? Has MinnPost ever disclosed its founders' and funders' vast investment interests when it writes about various topics? No.

So many interesting issues here, it's hard to pick which one is better: the question of the value of oil drilling off the coast, or the question of when journalists should disclose the business interests of an increasingly diverse ownership?

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Energy policy: What do you want?

Posted at 8:20 AM on July 7, 2008 by Bob Collins (57 Comments)
Filed under: Energy

What exactly do we want when it comes to an energy policy? A recent poll shows the public would rather seek new energy sources than significantly cut back on their usage. Are the polls correct?

That's the question on the second hour (10 a.m.) of Midmorning today.

Carroll Doherty: associate director of the Pew Research Center for the People & the Press; Matt Wald, a reporter for the New York Times; and Frank Newport:, editor in chief of The Gallup Poll join Kerri Miller.

News Cut is live-blogging and providing your assessment. You can listen to the program and provide your commentary in the comments section below.

10:05 a.m. - We're ready to go. You never know how these things are going to go. This topic should be interesting. Hopefully it'll involve a minimum of self-righteousness.

10:09 a.m. - Here's the Pew survey.

10:13 a.m. - Is $4 the "new normal?" Doherty asks. If so, how will this affect the spike in America's attitudes toward drilling and exploration?

10:15 Caller "David," who teaches science, says he's disturbed by lack of framing question with "conversion" fossil fuels to alternative sources. Carroll Doherty says "that's true, we just want to get a sense of where the public's attitudes are." Would've liked to do a fuller exploration of the public's views, and says it's notable that measures aimed at reducing consumption get overwhelming support. 90% say they favor higher CAFE standards and increased funding for mass transit. He says more and more Americans say expanded exploration have to be part of that mix.

Interesting -- to me -- is the comment of Todd below. He's not buying that there isn't some conspiracy behind all of this, what with the phony rolling blackouts in California and Enron's shenanigans in the past.

10:22 a.m. - Matt Wald of the New York Times joins us and reacts to the point here on News Cut about trust. "I want to go back a step. I don't think it matters whether you trust the oil companies or not." Sigh. He says the supposition in the Pew poll is that the answer is going to affect the price. He doesn't think it will because if you add supply, demand is still rising faster than supply. "We could find oil and we could find that the price went up anyway."

10:26 a.m. - Interesting comment from Neil (which I may read on the air) in the comments section. If I read it correctly, we're shoveling the living standards sand against the rising cost of energy tide.

10:29 a.m. - Beth calls to say the situation is a failure of environmental education, noting that the oceans and ANWR are under stress. The question I have, though, is whether people care to the degree, perhaps, they once did?

Matt Wald says the problem with polls is events move on. If you asked right after Katrina what's our biggest problem, people would've said "global warming." Now they've moved on to $4 gasoline. Polls don't get oil wells dug. It's companies deciding whether they can make money at it.

10:34 a.m. - During the news break, Kerri and I are chatting about the generation differences. Coincidentally, Jonna has jjust posted a comment say the young people have a sense of entitlement. "They don't look at their consumption, they just want more."

10:37 a.m. - We're joined by Frank Newport of the Gallup Poll who says the issue has not surpassed Iraq as the chief concern in the country right now. He says people answering polls now are much more likely to respond to anything that "sounds like it might lower the price of gasoline."

10:40 a.m. - The environmental aspect is still "the great divide" politically speaking, Newport says. He adds that it makes it more difficult for both McCain and Obama to move "toward the center" on the issue.

10:42 a.m. - Queried by Wald, Newport says Al Gore would be disappointed to learn that his climate change movie hasn't changed peoples' attitudes. Wald says the high price of natural gas may motivate more exploration.

10:47 a.m. - Just read Jonna's comment on the air. Matt Wald responds, if the belief is we have a right to cheaper energy, we have a problem. If it's that we can find alternative sources, then there's hope. He says younger people are more likely to have the latter view than the former.

10:50 a.m. - Wald says he 'runs for the exit' when he hears the term energy independence. It's not possible, he says.

10:51 a.m. -- According to the poll above 93% of those surveyed favor conservation. According to the 93% of those passing me at 75 mph while I'm driving 55, there might be a high "you conserve, I'll talk about you conserving" factor here.

10:53 a.m. - Wald says the next crisis may be electricity. Power lines aren't being built, natural gas (which powers electric plants) are at a high price. "We're going to feel it," he says. Might want to go turn down the air conditioning.

10:54 a.m. - Wald responds to caller -- and commenter -- about the oil companies not drilling on land they already own. "The oil companies don't seem convinced that $140 a barrel oil is here to stay."

10:56 a.m. - Kerri says even if people are passing me at 75 mph, they might be conserving "in other ways." Is that you. Let's keep talking during the afternoon. I'll meet you down in the comments section.

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$2 a gallon?

Posted at 1:31 PM on June 16, 2008 by Bob Collins (82 Comments)
Filed under: Energy

Do you think you'll ever see $2 a gallon gasoline again? Rep. Michelle Bachmann of Minnesota's 6th District thinks you will, if the U.S. "sends a signal" that more oil will be pumped out of the ground.

She held a news conference in Woodbury today (interestingly, it was at the gas station which usually has the lowest prices in town) to push her "No More Excuses Energy Act," which opens up more land for drilling

Bachmann says it would take about four years to get prices down to $2 a gallon.

Last week Bachmann told Politico that gas prices are now the #1 issue for her constituents:

As a matter of fact, in the parade we were at last weekend, people were shouting from the sidelines: "Drill in ANWR! Drill in ANWR!" One woman was sitting in one of those lawn chairs, and she had a piece of cardboard, and she had written on it, "Down with global warming freaks." I mean, these people are just ready to find someone to shake and say, "Help me with my gas prices."

Back when the price of a barrel of crude was $37 (it's around $140 today) in 2004, the U.S. Energy Department said opening up sections of Alaska to drilling would lower the price of a barrel of oil by 50 cents.

In May the energy department issued another report on ANWR, calculating an peak of 780,000 barrels a day. The report, which is being used by Republicans to justify opening ANWR to drilling, nonetheless contains this sentence:

Consequently, ANWR oil production is not projected to have a large impact on world oil prices.

One has to be careful in predicting the price of gasoline. Just ask Nathan Schaffer, a manager of the group that tracks gasoline refining and marketing for PFC Energy, a consulting firm in Washington. About 18 months ago he figured if a barrel dropped below $50 a barrel, gas prices would drop to below $2. That prediction didn't work out so well.

In today's news conference, Bachmann presented Diane and Gary Baran, two Woodbury residents who described their concern about gas prices.

Who are the Barans? He was a 2006 delegate to the Republican State Convention and an early Bachmann supporter in her bid for Congress. Both are longtime Republican activists in the 6th District.

It's not unusual to display political supporters at a news conference. On the other hand, they'res not exactly the average man-on-the-street.

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Going up?

Posted at 3:11 PM on June 6, 2008 by Bob Collins (5 Comments)
Filed under: Energy

"How do convenience stores decide when to change the price of gasoline?" a passenger in the NewsCutMobile asked this afternoon.

Easy enough. When the price of crude rises, the employees run out to change the sign. When the price of crude drops, they walk.

There was a lot of running going on today. Crude oil prices skyrocketed in the last couple of days, to near $139 a barrel, after dropping to about $122 earlier this week. The average price of gasoline in these parts dropped to near $3.72 (How do you like that feeling when you see $3.72 posted and figure, "Wow, at these prices I should fill up!"?)

The only thing that was preventing prices from increasing at the gas station where our friend pictured above works, was the wind. She kept trying to put the numbers up for the higher price, but the wind kept blowing them off her price-raising tool, momentarily frustrating her but -- also momentarily -- becoming the motorist's best friend.

Ingenuity won out, as it usually does, and within a few minutes she had successfully raised the price of a gallon of gasoline from $3.72 to $3.89.

A barrel of crude, by the way, is now projected to hit $189 within a year. You know, at these prices ...

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Fighting fuel

Posted at 6:49 AM on May 23, 2008 by Bob Collins (16 Comments)
Filed under: Energy

The MPR newsroom has put together a comprehensive gas prices section. Midday is doing a show at 11 which, if it's something more than playing the already-available MPR reporter pieces, I'll live blog it in search of tips.

Of great interest -- to me -- is a series of online calculators that you can use to confirm -- or overturn -- the wisdom of your various ways to save money. For example, I found on a fill-up, I'm saving a total of 8 cents, by driving the extra distance to the gas station that sells gasoline at 4 cents a gallon less than the closer station. At that rate of savings, and at the current rate of gasoline inflation, I will "earn" a free gallon of gasoline... in August 2009.

The Star Tribune today, meanwhile, carried a troubling story about people basically resigning themselves to whatever the cost of gasoline is, without intending to change any habits to alleviate the pain. Our ancestors, who once did without nylon stockings and tin, and won a world war that way, are rolling over, no doubt.

MPR's Marty Moylan has a terrific story today on how gas prices are spurring the sales of smaller cars... maybe.

He notes, however, that last year eight of the top 10 best-selling vehicles in Minnesota were trucks, vans, SUVs or mid-size sedans.

But hybrids are in and they're always a good deal in times of rising gas prices, right? Not always, and certainly not right away.

Jesse Toprak, director or industry analysis for Edmunds.com, says buying new fuel-efficient cars doesn't always save consumers money.

"You have to really look at the entire cost associated with the ownership of a new car and compare it, as best as you can, to the old car you have," Jesse Toprak of Edmunds.com told Marty. "And if you get a new car with a new monthly payment and higher insurance at the end your net result may end up being negative."

"Savings calculators" on some of the car company Web sites, not surprisingly, are notoriously misleading.

Take the Honda Civic Hybrid Web site, for example. If I were to trade in my 28 mpg car for a 45 mile per gallon hybrid, I would save $2,954.76 a year. Except, that I won't.

First, the current car is paid for so one would have to take on the cost of a new car loan. Using the car calculator at Cars.com, figuring on a $24,000 for the new car, anticipating $1,000 trade-in, a four year loan, current interest rates, and the Minnesota sales tax, it would cost $5,180 just to finance the purchase. You can buy a lot of gas for $5,180 (Note: If you're reading this a few years into the future, the price of gas was $4 a gallon when this was written, not the $5,180.9 a gallon it is now).

The first registration costs twice the amount of a renewal. That's another $99. The monthly insurance is going to be much higher (especially since the Civic is one of the most-often-stolen cars) and pretty soon the period to recoup the investment through reduced fuel usage (and maybe a tax break) is fairly high. That doesn't make it a bad idea, of course, it just makes it not as great an idea as we might've been led to believe.

Business Week's blog had an item last week on the anticipated 2009 Prius hybrid models, and lamented the lack of a plug-in version. It also suggested the payback period for some hybrids can be as short as 18 months. (Unfortunately, some of the links in the post don't work).

There's another potential downside of the hybrid (or more accurately: of us). Given higher mileage: the driver is more likely to drive more often, negating the impact of the purchase, according to the Asbury Park Press.

And that brings us back, again, to the key to fighting the rising cost of energy: the willingness to focus on fighting it.

$20 Challenge update: I've been trying to limit my gas purchases to $20 a week, and adjust my driving to whatever the fuel gauge tells me. How am I doing? On the ride home last night, the "check gauges" light came on. I've got enough to get to work today, but perhaps I should bring a blanket and pillow.... or tin and nylons.

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A gasoline price success story

Posted at 8:42 AM on May 22, 2008 by Bob Collins (2 Comments)
Filed under: Energy

It's time to compare notes.

On the way home yesterday, I tried to calculate whether my plan of spending only $20 a week on gasoline is going to work. I think I can make it to Friday if I don't make any unnecessary trips, I get a tailwind, and I only drive downhill. We'll see.

When I got home, I fired up Quicken to find out whether all of my fretting about the price of gasoline has been a worthy endeavor. Has it -- at least as measured by the cost of gasoline I'm putting in my car -- been warranted?

Surprisingly, no!

Using Quicken's reports feature, I called up how much I spent in gasoline in 2007 from January 1 to May 22. $363.61. Then I ran the same report, but changed the dates to 2008. The result? $364.20. That's a 51-cents increase. And I haven't even started the whole bike-to-work-one-day-a-week thing yet.

How'd that happen? I've been focusing on increasing my miles per gallon (I drive 55, I brake and accelerate over a greater distance), and not really considering the effect of combining trips etc.

I know a lot of you use Quicken, too, to track your finances. Run the same report, please, and report back here on the net result of your changed -- or not -- driving habits.

Also, list some of the ways you've changed. One tip free: Don't fill up. Fill the tank only half full. Otherwise, you're wasting gasoline lugging around the weight of additional fuel you don't need unless you're on a long trip.

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We're average

Posted at 4:52 PM on May 21, 2008 by Bob Collins (1 Comments)
Filed under: Energy

An 18-cents-a-gallon increase in the price of gasoline in the Twin Cities today has -- at least momentarily -- created a situation we haven't seen in months... possibly years -- gasoline prices higher than the national average. The big players are all charging around $3.85 to $3.89 a gallon this afternoon.

According to the Associated Press:

At the pump, meanwhile, the average national price of a gallon of regular gas rose 0.7 cent overnight to a record $3.807 a gallon, according to a survey of stations by AAA and the Oil Price Information Service.

Up until today, Upper Midwest per-gallon gasoline prices have been well below the national average, largely on the strength of the use of an ethanol blend.

Many retailers haven't caught up with the new price reality. In many cases, retailers cap pay-at-the-pump sales to a maximum of $50. That wasn't a big deal as recently as 6 months ago, but now it's becoming more common to have to run your credit card twice to fill up your tank.

And the major credit card companies don't allow gasoline sales of more than $75 at a time.

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Ethanol gets high marks

Posted at 1:34 PM on April 29, 2008 by Bob Collins (4 Comments)
Filed under: Energy

The Minnesota Corn Growers Association is out with a survey of 800 people that generally gives high marks to corn growers and ethanol. A spokesperson says the survey was not undertaken to be released to the media, but it subsequently was.

Since we've talked about the cost of ethanol-blended gasoline vs. the cost of straight gasoline on News Cut several times in the last month, it's worth pointing out that 55% of the people surveyed don't think it is less expensive and support its production for other reasons.

By the way, 70 percent of those surveyed believe global warming is a fact.

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A cure for jet fuel blues?

Posted at 12:49 PM on April 29, 2008 by Bob Collins (2 Comments)
Filed under: Energy

The cost of jet fuel is bankrupting airlines. Maybe there's a cure coming.

Biomass Magazine reports on Solena Group Technology's intention to build a biobased jet fuel facility in Gilroy, California. It will produce jet fuel from "municipal, agricultural and forestry waste."

The plan involves the use of "plasma gasification," which Matternetwork describesas " super-heating biomass with plasma torches (aka, death rays), rapidly breaking down the material into their component compounds, resulting in synthetic gas, or syngas."

Perhaps the biggest key in the idea is the fact that Gilroy wants the plant in their community.

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The 'ethanol tax' revisited

Posted at 9:30 AM on April 25, 2008 by Bob Collins (10 Comments)
Filed under: Energy

There are two current "shows that never end" on News Cut. One is the "WCCO fires Paul Douglas" entry. The other is the "ethanol tax" entry with my unscientific "study" that revealed how much more per gallon I have to spend for ethanol-blended gasoline than your basic "let's toast the Saudis" blend.

The Wall Street Journal blog picks up the theme of the latter -- without crediting, or probably reading, the genius of my 'study' -- by pointing out that at least one Web site is actively tracking this gap between the blends.

AAA, it says, has been posting the "adjusted E-85 price" as part of its daily gas price survey. Here's how the adjusted price is calculated:

The BTU-adjusted price ... is not an actual retail average price paid by consumers. According to the Energy Information Administration E-85 delivers approximately 25 percent fewer BTUs by volume than conventional gasoline. Because "flexible fuel" vehicles can operate on conventional fuel and E-85,the BTU-adjusted price of E-85 is essential to understanding the cost implications of each fuel choice for consumers.

I had calculated -- very conservatively -- a 2 or 3 cents per gallon "ethanol tax." The Journal blog says it's closer to 8%:

If that spread persists as E85 gains widespread use in America's cars, rather than the niche of vehicles now equipped for the fuel, the hidden costs for drivers would be akin to upgrading in the current gasoline-oriented world from regular to mid-grade. When was the last time you did that?

Wondering if this is the water-cooler talk at the Ethanol and Biodiesel University convention this weekend in Las Vegas?

3:19 p.m. - Dan McCullough E85prices.com posted a long commentary in the original "ethanol tax" topic (see link above). For straight price comparison, his site is pretty fascinating.

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Live-blogging 'Energy and National Security'

Posted at 7:04 PM on April 17, 2008 by Bob Collins (16 Comments)
Filed under: Energy

I wrote a post earlier this week about my experience with ethanol vs. non-ethanol blended-gasoline and it spawned a lengthy debate about the issue. Tonight (Thursday) MPR's Kerri Miller is hosting a discussion in the UBS Forum at MPR with Anne Korin, co-director of the Institute for the Analysis of Global Security and chair of the Set America Free Coalition, and Ed Garvey, director of the Minnesota Office of Energy Security. Matthew Wald, who covers energy issues for the New York Times, was supposed to be here but he's been dispatched to Louisiana to cover the American Airlines maintenance woes (or so I'm told).

It's not about ethanol per se but it's close enough to warrant sticking around for a little live-blogging. You can listen here and if you'd like to add your comments during the event, so much the better.

7:05 - We're underway. Here's the theme. How does our reliance on foreign oil change influence our foreign policy? How real are the claims that the U.S. can be truly 'independent' of foreign oil and what will the next president's energy policy look like, given the way oil prices are headed. Four years ago, a barrel of oil hit $50 and drivers were grumbling as a gallon passed $2. Oil closed today at almost $115. At a gas station in Blaine gasoline is going for $3.52 tonight.

7:11 - Korin: "We paying for both sides of the war. Every time we go to the gas station, some of the money goes to Saudi Arabia, which funds terrorist groups around the world."

(Continued below the fold)

Continue reading "Live-blogging 'Energy and National Security'"

The ethanol tax

Posted at 1:52 PM on April 14, 2008 by Bob Collins (57 Comments)
Filed under: Economy, Energy, Pawlenty

For all the talk about the ruin to be caused by the gas tax increase in Minnesota, comparatively little is said in the state these days about the "ethanol tax," which has had a significant impact in the cost of operating a vehicle and may, according to some people, have a role in rapidly increasing food prices.

For the last few months, I've been conducting an unscientific experiment: filling up my car with regular gasoline and comparing the performance with the ethanol blends I'm required to use in Minnesota.

Although Wisconsin drivers get a choice, lawmakers are considering an ethanol mandate, which would require 10 percent of gasoline to be a blend of ethanol, rising to 25 percent by 2025. Here's a copy of the legislation. Minnesota, on the other hand, requires all gasoline sold to be at least 10 percent ethanol.

I snuck across the border several times to fill up the 2004 Chevy Cavalier (the official car of News Cut) with ethanol-free gasoline. The result? My car got about 32.6 miles per gallon. The Minnesota blend gave me almost 29 miles per gallon, a 12% drop in performance.

Calculating current prices (the average price of gasoline in Minnesota now is $3.235. In Wisconsin it's $3.40), driving 1000 miles on Minnesota gas costs $111.55 (11.2 cents per mile). On Wisconsin gas, 1,000 miles costs $104.29 (10.4 cents a mile), a $7.26 savings, even though the difference in the price of a gallon is almost 17 cents. The "ethanol tax" works out to 2.3 cents a gallon.

In addition to the increased fuel costs to consumers, taxpayers also support ethanol producers with a 20-cents-a-gallon subsidy. The feds chip in another 51 cents a gallon.

My little experiment showed me that I spend an additional $80 or so a year at the pump because of ethanol. It's not a huge deal, although some of the rhetoric surrounding similar numbers in the gas tax debate suggested it's the difference between me keeping and losing my home.

But the "tax" is about to go higher. In 2005, there was no bigger supporter of a 20-percent mandate than Gov. Pawlenty. He signed a bill raising the requirement for ethanol in a gallon of gasoline to 20-percent by 2013.

Six Republicans in the House this year ran into trouble for supporting an increase in the gas tax. In 2005, however, 48 Republicans voted for what's turned out to be "the ethanol tax."

The concerns about the ethanol mandate, of course, are years old. An MPR story in 2002 documented the steamrolling of politicians by the ethanol lobby.

As MPR's Cara Hetland reported last fall, the ethanol mandate is an economic development program for farmers. And Cargill today reported an 86-percent jump in profits. Good for them. Consumers? Not so much.

But there is plenty of dispute about the effect of ethanol on food prices and, hence, its role -- if any -- in inflation. Last week, Texas A&M released a report that suggests that corn prices -- corn is used to make ethanol -- would have risen substantially anyway as petroleum-based costs -- fertilizer, for example -- went up. The report said higher corn prices "do have a small effect on some food items."

Update Mon. 10:14 p.m. - An article in Tuesday's New York Times doesn't let ehtanol/biofuels quite so easily, and invokes the U of M's C. Ford Runge:

C. Ford Runge, an economist at the University of Minnesota, said it is "extremely difficult to disentangle" the impact of biofuels on food costs. Nevertheless, he said there was little that could be done to mitigate the impact of droughts and growing appetites in developing countries.

"Ethanol is the one thing we can do something about," he said. "It's about the only lever we have to pull, but none of the politicians have the courage to pull the lever."

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