Energy & Transportation Update

ENERGY

Customers Could See Lower Winter Heating Costs

Low wholesale natural gas prices could result in lower heating bills for many this winter. In much of the country, natural gas utilities periodically adjust rates based on the cost of natural gas in the wholesale market. In Missouri, both Missouri Gas Energy and Laclede Gas have lowered rates base on wholesale fuel prices.

Gas price is a significant portion of the variable costs that are accounted for in the rate. Rates also include a utilities fixed costs, such as the cost of pipes and other infrastructure, that do not vary much over time.

The total cost of heating is affected by other factors. In particular, the length and severity of cold periods affects the amount of natural gas used. Even if the unit price of gas is lower, if more is used because there are more cold days or colder days, the total paid for gas could go up.

USDA Grants $2.9M to Missouri for Ethanol Distribution

The U.S. Department of Agriculture’s (USDA) Biofuel Infrastructure Partnership granted $2.9 million to Missouri to increase the availability of ethanol. The state anticipates the grant will aid retailers in the installation of 171 pumps for fuels that contain ethanol. You can find more about this grant here.

Ethanol is a type of alcohol used for fuel; for automobiles it is typically blended with gasoline. Missouri requires most gasoline sold to contain 10 percent ethanol, though some vehicles can run on fuel that is as much as 85 percent ethanol (E-85).

                           

TRANSPORTATION

$10M Federal Grant to Aid Missouri-Illinois Bridge Replacement

The federal government has committed $10 million to the construction of a bridge to replace the Champ Clark Bridge at Louisiana, MO. The bridge links U.S. 54 in Missouri and Illinois. Illinois has committed funding for its share of the cost, but Missouri is still seeking much of the $30 million needed for its share. You can find out more about this project here.

Oil & Gas Industry Toots its Own Horn

The American Petroleum Institute (API) released a report touting the economic benefits of the oil and gas industry.  There are a lot of figures in the report.  Some that will likely make policymakers set up and listen are 

• The oil and gas industry supports 9.2 million American jobs, and
• The average refinery worker makes $94,500 annually (I have to rethink my career choices).

 This seems to be part of a larger plan to improve the industry’s image.  You probably recall seeing lot of advertisements about the benefits of oil and natural gas during the last election cycle.

Related posts and articles

API Wants Energy Back In 2012 Elections (Ryan, M., AOL Energy, Jan. 5, 2012)

As Voters Focus on Energy, API Chief Begs: 'Turn Us Loose' (Gardett, P., AOL Energy, Aug. 23, 2012)

The State of American Energy (API)

Trillions and Billions: US Oil and Gas Sector Reviews Its Economic Footprint (Gardett, P., AOL Energy, Jan. 8, 2013)

Energy & Water Roundup

ENERGY

Consumer Group Opposes Missouri Energy Rate Reform Bill

The Midwest Energy Consumer Group (MECG) has come out in opposition of HB2689 (and its parallel in the Missouri Senate, SB1028), which would make significant changes to the way electric rates are regulated in the Missouri. The group claims that the bill would remove the voice of customers from the electric rate setting process and pave the way for regular, uncontested rate increases. The Office of Public Counsel, which officially represents customers in Missouri utility rate cases, expressed concern that the bill might limit the ability of the agency, as well as the state’s Public Service Commission, to review rate increases.

Related Posts

Bill Would Change Electric Ratemaking in Missouri

Senate Passes Energy Bill

The U.S. Senate passed its first major energy bill in a decade. The bill emphasizes development of alternative energy, natural gas, and lesser used sources such as geothermal and hydropower. It also focuses on energy efficiency and safety. The bill will need to be reconciled with the energy bill passed in the House of Representatives, which differs significantly, particularly in its approach to fossil fuels (coal, oil and natural gas). Senate leaders are confident they can work out differences with the House and develop a compromise bill that can pass both chambers latter this year.

What Is a Microgrid?

I’m seeing a lot about microgrids in utility publications and on the Internet. I thought it might be worthwhile to write something that could serve as an introduction to the subject for those who are unfamiliar with it, as well as educate myself in the process. I intend this to be the first in a series of short posts on the subject.

Let’s start with the basics. What is a microgrid?

A microgrid is a local energy grid that can disconnect from the larger grid and operate independently. It connects to the main grid at a location where the voltage of the two systems can be maintained at the same level. A switching system can manually or automatically switch the connection on or off.

Though the name “microgrid” implies something small, size is not a defining point. Microgrids are defined by

-local control, and

-functioning both connected to and disconnected from the main grid.

If you’re interested in finding out more about microgrids, here are some resources to get you started.

About microgrids (Berkeley Lab)

How microgrids work (Lantero, A., Energy.gov, June 17, 2014)

WATER

A Little Sewer History

The Guardian posted an article on the Great Stink of 1858 and how it prompted officials in London to improve the city’s overwhelmed system of handling storm water and wastewater. The Thames of that time was a stinking mess of sewage and a hazard to health. The sewer system devised by Joseph Bazalgette was a marvel of the age (and much of it is still in use) that moved wastewater discharges away from the populated areas around London.

You can read this very good article here. If it whets your appetite to find out more about this project, you may also want to read Dreams of Iron and Steel by Debora Cadbury. The Great Stink by Clare Clark is a fictional thriller set during this time that partly takes place in the changing sewers of London.

Infrastructure & Environment News

Energy

Alternative Energy Links

My lack of time to write for this blog has reduced me to a compiler of infrastructure news, though such compilation has always been part of Infrastructure Watch. You can links to several alternative energy articles here.

Low Gas Prices No Problem for Solar

Low gas prices didn’t last long around here (at least they didn’t stay less than $2 per gallon for long). Either way, Tony Randall discusses why low oil prices are not a problem for the continued growth of solar power in Bloomberg.

Infrastructure

John Oliver Thinks Infrastructure Sexy

Comedian John Oliver featured America’s infrastructure in a segment on his show Last Week Tonight. Obviously, Oliver’s tone is humorous and mocking, but he presents a thoughtful essay on the issue. You can see it on YouTube.

States

New Environmental Director in Nebraska

Congratulations to Jim Macy, who was recently appointed by Gov. Pete Ricketts to serve as director of the Nebraska Department of Environmental Quality. Macy has worked in the area of environmental regulation and compliance for decades, including leadership roles at the Missouri Department of Natural Resources.

Transportation

States Take Lead on Infrastructure Funding

Washington senate leaders have proposed to raise the state gas tax to 11.7 cents per gallon over the next three years. The proposal would also redirect a portion of the state’s sales tax to its transportation fund (more here).

Oregon will experiment with a program of fees based on miles driven rather than a gas tax beginning this summer (more here). Many think this is a more rational way to fund highways.

In my home state of the Missouri, the governor came just short of calling for a gas tax hike as part of the state of the state address. Tax Justice Blog has a nice summary of proposals in several other states.

Water

Baltimore Sewers Featured on Radio

The radio program Marketplace featured the Baltimore, MD, sewer system and the issues associated with a large, aging infrastructure (listen to or read the story here). Baltimore is not unique; these problems are plaguing cities across the nation.

San Francisco Opens New Hetch Hetchy Tunnel

The San Francisco Public Utilities Commission opened the New Irvington Tunnel. The 3.5-mile, 9-ft diameter tunnel will carry 265 million gallons a day. It is part of the Hetch Hetchy system, which brings water from reservoirs as far away as Yosemite National Park, 167 miles. (Read more about the project at KQED.)

Water and Art

Adres Jacque will build a temporary structure that uses plants to purify water in the courtyard of MoMA PS1. Organisms in the structure will glow in the dark to provide light. See this Fast Company article for more information.

Infrastructure & Environment News

Energy

Alternative Energy Links

My lack of time to write for this blog has reduced me to a compiler of infrastructure news, though such compilation has always been part of Infrastructure Watch. You can links to several alternative energy articles here.

Google Pledges Investment in African Renewables Project

Google pledged to invest in the Lake Turkana Wind Power Project in Kenya. You can find more about this project here.

Low Gas Prices No Problem for Solar

Low gas prices didn’t last long around here (at least they didn’t stay less than $2 per gallon for long). Either way, Tony Randall discusses why low oil prices are not a problem for the continued growth of solar power in Bloomberg.

Renewables Generators Face Distribution Problems

As the U.S. develops renewable energy resources, it is facing a problem: the places where we most want to use the energy are some distance from the places where we are best able to generate it.  States in the middle of the country are becoming involved in conflicts between clean energy proponents and landowners, sometimes turning environmental and energy groups into uncomfortable allies.

Missouri is one state where the issue has come to head. Earlier this year, the Public Service Commission rejected a project that would carry energy from wind farms in Kansas to users in Indiana. The commission determined that the project was not needed, and many of the public comments received by the commission expressed opposition to the project. The company behind the proposal, Clean Line Energy Partners LLC of Texas, is also proposing a line to connect Oklahoma to Tennessee, which faces opposition in Arkansas.

Environmental groups have been supportive of the Missouri project. Missouri’s chapter of the Sierra Club has acknowledged that the Clean Line route avoids many environmentally sensitive areas, and expressed hope that it will help in the move away from coal. The Sierra Club also supported a Clean Line project in part of Arkansas where it was opposing an oil pipeline project.

Supreme Court Hears Demand Response Case

The Supreme Court has been hearing arguments in a case related to demand response. Demand response refers to methods large energy user adjust their use to reduced demand during normally high use times when energy is expensive. Demand response reduces peak demand, evens out energy use, and reduces cost of energy production.

Companies have created markets to trade these reductions in demand (sometimes called negawatts) as if they were power being supplied to the market. When major users reduce shift use or move use to off-peak times, they reduce the need to ramp up additional generating units, and save money for generators. The Federal Energy Regulatory Commission (FERC) has enshrined this in regulations that require energy wholesalers to pay for these commitments to reduce demand the same amount they pay for a commitment to generate electricity.

The crux of the argument before the court is the regulatory authority of FERC. FERC has authority related to wholesale energy markets, where commitments to generate might be traded (and FERC rules say a commitment to reduce demand should get an equal price). The utility customers who are making the commitments to reduce demand are buying energy in the retail market, which is regulated by states.  Opponents of the FERC rules say that it is getting into retail markets in which it has not authority. FERC argues that it is the only agency that can effective regulate this kind of trading, and that there is a public good in the demand reductions and efficiencies provided by demand response.

You can find more about this case here, along with a description of how it may become important to small retail electricity users (i.e. almost all of us).

Infrastructure

John Oliver Thinks Infrastructure Sexy

Comedian John Oliver featured America’s infrastructure in a segment on his show Last Week Tonight. Obviously, Oliver’s tone is humorous and mocking, but he presents a thoughtful essay on the issue. You can see it on YouTube.

States

New Environmental Director in Nebraska

Congratulations to Jim Macy, who was recently appointed by Gov. Pete Ricketts to serve as director of the Nebraska Department of Environmental Quality. Macy has worked in the area of environmental regulation and compliance for decades, including leadership roles at the Missouri Department of Natural Resources.

Transportation

States Take Lead on Infrastructure Funding

Washington senate leaders have proposed to raise the state gas tax to 11.7 cents per gallon over the next three years. The proposal would also redirect a portion of the state’s sales tax to its transportation fund (more here).

Oregon will experiment with a program of fees based on miles driven rather than a gas tax beginning this summer (more here). Many think this is a more rational way to fund highways.

In my home state of the Missouri, the governor came just short of calling for a gas tax hike as part of the state of the state address. Tax Justice Blog has a nice summary of proposals in several other states.

Water

Baltimore Sewers Featured on Radio

The radio program Marketplace featured the Baltimore, MD, sewer system and the issues associated with a large, aging infrastructure (listen to or read the story here). Baltimore is not unique; these problems are plaguing cities across the nation.

San Francisco Opens New Hetch Hetchy Tunnel

The San Francisco Public Utilities Commission opened the New Irvington Tunnel. The 3.5-mile, 9-ft diameter tunnel will carry 265 million gallons a day. It is part of the Hetch Hetchy system, which brings water from reservoirs as far away as Yosemite National Park, 167 miles. (Read more about the project at KQED.)

Real-Time Sensor for Bacteria in Water

A device has been developed in Denmark that can detect bacteria in water. Of course, not all bacteria is harmful, so it seems the usefulness of the tool may be limited to screening for now. However, it continuous, real-time monitoring could be a useful screen to determine when additional testing is should be performed or when a contamination event started. If commercial versions of the sensor are affordable, multiple sensors could be placed in a drinking water distribution system to continuously monitor water quality, disinfection effectiveness, and potential contamination.  You can find out more about the sensor here.

Water and Art

Adres Jacque will build a temporary structure that uses plants to purify water in the courtyard of MoMA PS1. Organisms in the structure will glow in the dark to provide light. See this Fast Company article for more information.

In Congress

Continuing Resolution

Because Congress still has resolved budget debates and passed appropriations bills, it will need to pass another continuing resolution by March 27. The bill passed by the House of Representatives (H.R. 933) holds non-defense spending at the levels approved in Fiscal Year 2012.

One consequence of this is, at least for the time being, the increased spending on surface transportation programs included in MAP-21 will not be enacted. Senate leaders indicated that they might add transportation spending increases in that chamber.

Related posts and articles

Continuing Resolution Puts Transportation Funds at Risk (Save America’s Infrastructure, Mar. 11, 2013)

House, Senate Transportation Bills Differ

Budget proposals from the House of Representatives and the Senate differ greatly on transportation (as well as other issues). Mainly, the House budget cuts transportation funding, and the Senate budget increases it.

Related posts and articles

Proposed 2014 Transportation Budgets Differ Wildly. Who Will Win? (Infrastructure USA, Mar. 18, 2013)

Ryan budget targets DOT, high-speed rail funding (Liang, K., The Hill, Mar. 12, 2013)

Senate Questions Interior Secretary Nominee

The Senate Energy and Natural Resources Committee posed questions to Sally Jewell, President Barack Obama’s nominee for Secretary of Interior. As you might expect, questions focused on energy development on federal lands and environmental protection related to such projects. Of particular concern was hydraulic fracturing (fracking) for natural gas production in western states and oil drilling in the Pacific Ocean and Alaska.

Related posts and articles

US Interior nominee Jewell resists some drilling proposals, calls for 'balance' (Platts, Mar. 15, 2013)

Government Accountability Office Reports on Federal Utility Oversight

The Government Accountability Office (GAO) issued a report on the Federal Energy Regulatory Commission’s (FERC) regulation of mergers since the enactment of the Energy Policy Act of 2005. This act reduced restrictions on the types of companies that could hold and interest in electric and natural gas utilities.

The major concern of the report is prevention of cross-subsidization. Large interstate holding companies may have interests in utilities, services to utilities and other businesses. The holding company may provided common services (like legal and administrative services) to the businesses the own. In cross-subsidizing, a holding company would disproportionately charge these costs to the utilities, overcharging them an leading to higher utility rates, and using that to subsidizes its other businesses.

GAO suggests that FERC does not adequately consider the risk of cross-subsidization in its review of mergers and subsequent oversight. FERC has responded that it has the rules in place and expertise to enforce the requirements of the law.

The report includes an overview of the history of federal energy regulation. It is worth skimming the report for that. You can view the full report here.

Bill Introduced to Make Federal Disaster Aid Available to Private Energy Utilities

Representative Charlie Melancon (Louisiana) has introduced “Ratepayer Recovery Act of 2007” (H.R. 6013). The bill would allow private and invester-owned natural gas and electrical utilities to receive federal aid to repair disaster-damaged transmission and distribution infrastructure.

Water News

Water Rulemaking Anticipated in 2012
The Environmental Protection Agency has tentatively slated two rules for final issuance this year, the Third Unregulated Contaminant Monitoring Rule (UCMR3) in March and the Revised Total Coliform Rule (RTCR) in November.

UCMR3 will apply to some water systems. As the name suggests, it will require monitoring for potential contaminants that are not currently regulated. The rule focuses on 28 contaminants and the monitoring will take place in 2013-2102.

RTCR will apply to all water systems. The rule will be similar to the existing TCR, but the indicator organism will be E. coli rather than total coliform. E. coli is used as an indicator of potential fecal contamination, and its presence in drinking water will trigger public notice and additional monitoring. Where the new rule will differ is that it will require additional monitoring for some systems and will bring more attention to finding and preventing potential bacterial contamination, especially in distribution systems.

Kansas to Take a Look at Fracking
The Kansas Water Office is planning to have a meeting about hydraulic fracturing (fracking) in February. There is a lot of demand for oil and gas exploration in Kansas and the state Division of Water Resources has approve nearly all of the 600 applications for temporary water permits it received in 2011 related to such explorations.

Find more at
Despite Drought, Fracking Causes Spike in Water Permits for Oil, Gas Exploration in Kansas
Fracking in Kan. Pushes Water Permits to New High
Fracking in Kan. Pushes Water Permits to New High
Fracking in Kansas Pushes Water Permits to a New High
Fracking Pushes Water Permits to New High
Water Permits Up Due to Fracking in Kansas

USDA Releases Emergency Funds for Response to Floods, Other Disasters

The U.S. Department of Agriculture (USDA) has announced it will release $300 million in emergency funds to repair farmland and property damaged by the several natural disasters that occurred in the last year. Missouri will be one of the states where significant aid will be provided (about $50 million), mainly in response to extensive damages to farms from flooding.

Find more at
USDA Announces $308 Million for Disaster-Stricken States

Bill Would Limit Greenhouse Gas Considerations in Endangered Species Decisions

Sen. John Barrasso (Wyo.) has introduced a bill (S. 724) modifying the Endangered Species Act. The bill would prohibit the Secretary of Interior from considering global climate change as a natural or manmade factor affection decisions about whether species are endangered or threatened until the Administrator of the Environmental Protection Agency confirms that all major emitters of greenhouse gases have signed an international agreement to limit carbon emissions. Major emitters of greenhouse gases includes China, India and the United States.