February 4, 2011

Permitorium: Shell is the latest casualty fromthe war on affordable and reliable energy; EPA and DOE carry out Obama’smyopic  energy views while the consumer suffers high energy prices New York Times (2/3/11) reports: Shell CEO Peter Voser in anearnings call with reporters said the company would need to spend as much as$150 million without knowing whether it would receive needed permits from U.S.EPA and the Interior Department…"Despite our investment in acreage andtechnology and our work with the stakeholders, we haven’t been able to drill asingle exploration well," Voser said. "Critical permits continue tobe delayed, and the timeline for getting these permits is stilluncertain….The plan took a hit in late December when an EPA appeals boardremanded Shell’s Clean Air Act permits back to the company for revisions,faulting the agency’s analysis of the impacts of nitrogen dioxide emissionsfrom drill ships on the Alaska Native communities (Greenwire, Jan. 5)…Shell, which hasinvested more than $3 billion in its Arctic development plan, also awaitsdrilling permits from Interior…The company’s decision postpones explorationby at least a year in a region federal scientists believe could hold thenation’s second-largest oil and gas reserves after the Gulf of Mexico,

Smoke ’em if you got’em:  After failing to stick it to American families with a "carbonpollution" bill (read national energy tax), Al Gore enlists Don Draper torepackage his job killing (and pocket lining) agenda Politico(2/4/11)Is Al Gore revving up his deep-pocketed advertising apparatus? By thelooks of his latest hire – the “Elvis of advertising” – that wouldbe a big yes. Alex Bogusky, a founding partner of Crispin Porter + Bogusky andthe creator of the “Truth” campaign to fight teen smoking, is joining Gore’sAlliance for Climate Protection as creative director and chief marketingofficer…“The fight against global climate change requires innovative thinkingand bold strategies,” Gore said in a statement provided to POLITICO. “We arethrilled that Alex will bring his vision and passion to the organization, andare lucky to have someone so deeply committed to helping us find new ways tocommunicate the seriousness and solvability of the climate crisis.…Thisisn’t Bogusky’s first dance with Gore’s Alliance. In 2009, he created thegroup’s “Reality” campaign that took on “clean coal” technology, and includedTV spots directed by the Oscar-winning Coen brothers….Alliance officialsstressed that they’re not announcing a new ad campaign right now. But theyacknowledged the hiring was the “first step in the next phase” as the Gore-ledgroup taps into Bogusky’s contact list for help finding new ways to talk to thepublic about climate. “He’s reaching out to that whole world of talented adagency people,” Alliance CEO Maggie Fox told POLITICO’s Darren Samuelsohn. “Hewas one of them. He’s their peeps. Part of what we’re going to do is invitethem to join us in a very aggressive way.”

Subsidizeme because my business is inefficient and expensive or I’ll take my ball and gohome WashingtonPost (2/3/11) reports: Businesses respond to signals, not speeches. Highunemployment tells companies to hold off on production, and low interest ratestell companies to borrow, but State of the Union addresses don’t have the powerto tell companies to do anything. …So when the president says he’s committed togreen energy, that’s fine. But the U.S. isn’t giving alternative energycompanies the green light. We’re giving off something more like aruddish-yellow light, as if to say: Go ahead if you’d like, but proceed at yourown caution….Ask Eric Spiegel, CEO of Siemens USA, who told me his company isheld back by the United States’ reluctance to pass a carbon tax or makepermanent the solar tax credit. "If you don’t do anything on carbon andyou don’t have renewable energy standards or investment tax credit, everyutility company would go out tomorrow and build coal," he said.

Whatif Obama had an energy plan that created real jobs instead of jobs reliant ongovernment handouts?  Bloomberg(2/3/11) reports: President Barack Obama will back new tax incentives andgovernment financing to make buildings more energy efficient as a way to cutenergy costs and encourage job growth, according to an administrationstatement…Obama wants Congress to revamp an existing tax deduction forcommercial building upgrades to create a credit that would be more attractivefor owners and real estate investment trusts to “retrofit” properties,according to a White House fact sheet. The plan also calls for the SmallBusiness Administration to work with lenders to take advantage of higher loanlimits to promote energy efficient upgrades by businesses.

The administration says building and businessowners would save a total of about $40 billion a year by making their structuresmore efficient.

Reasonablerate of return might finally become the dominate consideration instead ofgovernment mandates for renewable energyCNBC(2/1/11) reports: President Obama laid out an ambitious goal in his latestState of the Union address: By 2035, America will get 80 percent of itselectricity from clean energy sources…Achievable? Maybe, if you consider thatObama’s expansive definition of clean energy includes nuclear and emerging cleancoal technologies, which many environmentalists don’t embrace as ways to combatgreenhouse gases…A less-obvious question is whether mutual fund investors willhave the patience to stick with green investing principles that have recentlyleft them in the red…The stocks of renewable energy companies, such as wind andsolar power providers, have been big losers. The Clean Edge Global Wind EnergyIndex, which tracks wind energy stocks, is down about 27 percent over the last12 months…That disappointment came as oil company stocks and the Standard &Poor’s 500 stock index both surged about 20 percent.

Whatmore do we need to say: biodiesel production collapse by 20 percent whengovernment subsidies expired. Reuters(2/3/11) reports: Biodiesel, still a money-losing proposition in the UnitedStates compared to oil-based diesel, is about to have its best year ever thanksto government tax credits and usage mandates…But it will take months for thebiodiesel industry to bounce back after being stranded last year, when thegovernment let its six-year subsidy expire. Biodiesel production fell 20percent in 2010 and was only half of 2008 output as plants across the countryclosed or slashed production…"It’s not like the industry flipped on theswitch and we’re all running at capacity now. It takes time for the markets toadjust," said Gary Haer, vice president, sales and marketing with theRenewable Energy Group in Ames, Iowa.

Notlost in translation: China understands the allure of the SUV; demand spikes andcar manufacturers can’t keep up – I think Al Gore just fainted. WashingtonExaminer (2/3/11) reports: Uh oh, this isn’t going to sit well with BigGreen environmentalists in the U.S. who absolutely hate the trucks andSport-Utility Vehicles (SUV) American buyers have loved for nearly twodecades…Automotive News China reports that Chinese automakers are gearing up tointroduce a whole new generation of SUVs in order to meet spiralling demand inthe world’s most populous country. And no wonder, what with SUV sales soaring40 percent in 2009 and doubling again last year…ANC’s Yang Jian characterizesthe growing demand among Chinese buyers for SUVs as a "stampede," andreports that four of China’s top domestic automakers are tooling up theirfirst-ever SUV offerings…"To get a glimpse of how strong that demand is,one only needs to look at the vehicles imported into China each year,"Jian said.."In 2010, China imported 650,000 vehicles of which 57 percentwere SUVs, according to the China Automobile Trading Co.," he said.