As the Deepwater Horizon rig disaster continues to unfold, the peak oil community has a “teachable moment” in which it can illuminate the reality of our energy plight. The public has had a crash course in the challenges of offshore oil, and learned a whole new vocabulary. They are more aware than ever that the days of cheap and easy oil are gone.

What they do not yet grasp are the challenges in transitioning from fossil fuels to renewables.

The Oil Drum | 195 Californias or 74 Texases to Replace Offshore Oil.

Thomas Energy

The Other end of BP’s pipeline - From the Alberta TAR SANDS to BP’s Whiting Refinery.

via [ Democracy Now ] Indigenous Groups Lead Struggle Against Canada’s Tar Sands

Thomas Energy, Environment

We all remember these ads from BP. You couldn’t miss them, they were all over the airwaves.

Thomas Energy, Environment

H2oil animated sequences from Dale Hayward on Vimeo.

Thomas Energy, Environment

via [ Huffington Post ]

As BP’s Earth Day Disaster continues to spread beyond the Gulf more and more questions are being asked.

Thomas Energy, Environment

via [ WBEZ - Chicago Public Radio ] Worldview Segment “Will the Gulf Spill Affect BP Investment in Chicago Area? By Michael Puente.

Officials with the oil giant BP say it’s recovering about 3-thousand barrels of oil a day from that huge leak in the Gulf of Mexico. The company is spending millions to stop the leak and may have to shell out billions more in cleanup costs and economic losses to the region.

Closer to home, in Northwest Indiana, there’s concern that all this expense may affect BP’s multi-billion-dollar investment in its Whiting, Indiana refinery, just a few short miles from Chicago’s city limits.

The Gulf catastrophe also has emboldened BP’s local critics about the company’s environmental record here.

WBEZ’s Michael Puente brings us this report from our Northwest Indiana bureau in Chesterton

Michael’s Interview with me comes toward the end at the 6:10 minute point

Thomas Energy, Environment

25-years-ago BP abandoned its professional training facilities in Robertsdale, donating the facilities to Calumet College, and moved to a 200-acre LEED certified campus in Naperville. They did so because they could no longer attract professionals to this location due to Quality of Life issues. Quality of Life issues they had a major hand in creating.

Today BP’s professional staff enjoy the healthy work environment of a green campus with ample buffering between office buildings and roadways, while residents adjacent to the BP’s refinery are not so fortunate. Today BP is constructing a whole new facility at their East Chicago / Whiting Refinery to refine the “No Good, Very Bad, Dirty” heavy sour crude from the Alberta Tars Sands and to do so they are constructing 6 cokers directly across the street from the Marktown Historic District where more than 120 children under the age of 18 live, play and sleep.

BP likes to refer to the project as a modernization or retooling project. This is an important distinction to them because to call it what is, a “new facility” or “new construction,” would trigger all sorts of regulatory reviews and permitting, including a new-source review requiring an environmental and health risk assessment. I am not certain if there has ever been a risk assessment done on the impacts the BP refinery has the neighboring communities. I don’t know if that is because they have been grandfathered in or what. I just know that new construction ought to trigger a new source review and that is not happening.

For labor purposes BP calls the project a “maintenance project.” Thus they bypass all sorts of labor rules in terms of pay, scheduling, and work conditions as would be the case for new construction. Let’s make this simple, if I tore down my house to construct a brand new home, I could not go to City Hall seeking a maintenance permit for the new construction. I would be required to seek the proper permits and follow requirements for new construction. This is just one way in which BP has been cutting corners here to save themselves costs. I can’t say what other cost cutting measures BP is making, but I do know they did not do this without the aid of regional leadership. I wonder what our regional leadership is thinking now as we learn more about the costs of BP practices to the gulf region.

This is a good environmental justice example of how benefits-without-risks are created and separated from risks-without-benefits in a free-market economy. Free-market corporations and present day land use policies have a very intentional consequent of accumulating wealth and benefits in one location while clustering risks and blight in another. All too often the geography of separation is as clear as the “Northshore” and “Southshore” designations.

It makes me wonder if anyone working in office complexes similar to the BP complex in Naperville feel any sense of culpability for the lives negatively impacted on the other side of their company’s production line. What about Kraft Foods? what about Grainger? what about Cargill? and U.S. Steel? and ArcelorMittal? Boeing? GATX? or Ryerson?

[ Wikipedia list of Corp HQ in the Chicago Met area ]

Compounding problems, BP extracted an additional $165 million in tax abatements from the mostly poor people of Marktown and East Chicago. They did this behind closed doors, and without a single public hearing, all while lecturing the region on “Good Government.” Despite efforts, residents, who pay the highest property taxes in the state at 7.4%, still do not know that they gave up $165 million to BP. BP accomplished this feat by spreading the wealth to voting districts outside the plume of negative externalities while taking advantage of their partnerships with corrupt local political enterprises under the plume. BP is well known for this form of philanthropic activity and I could go on about “to whom” and “how much” was given, but that will have to be for another post. Let these two examples suffice for now.

Three years ago a $25-million donation from BP capped Phase 1 of a three-part expansion and renovation campaign. Since 2002, BP had agreed to more than $125 million in state and regional legal settlements over pollution problems.

Art museums are often the beneficiaries of largess from corporations wishing to polish their sometimes less-than-gleaming image. (Cigarette, anyone?) Oops.

via [ LA Times ] BP Grand Entrance at LACMA looking not-quite-so-grand

In 2009 BP gave to Napperville for $1 an extremely expensive Hydrogen fueling station with multipliers of positive effects.

Thomas East Chicago Portrait Series, Energy, Environment

This video reminds me a lot of how political and regulatory authorities in Northwest Indiana behaved when BP was seeking permits to retool their facilities to refine the Alberta Tar Sands in East Chicago

Thomas Energy, Environment

Yeah, we do, and we need more information than just these photos.

Thomas Energy, Environment

Sometimes it takes a disaster like the Earth Day Disaster to realize our hometowns and our future have been colonized.

Thomas East Chicago Portrait Series, Economics, Energy, Environment, Infrastructure, Politics

Bloody Oil from Felix Gonzales on Vimeo.

Thomas Energy, Environment

This is one way I wrap my mind around Tax season - and a way of seeing. Two days ago, April 13, one of the largest solar prominences in years erupted from the sun. The expanding cloud could deliver a glancing blow to Earth’s magnetic field around today, Tax Day, April 15th.

Thomas Energy, The Space I Occupy

The Center for Neighborhood Technology (CNT) has begun to map out housing costs by factoring in transportation. We are not far from indexing other costs associated the overhead that comes with choosing a community in the purchase of a home (property or sales tax, produce, local services, health care, education, industrial externalities - pollution, etc). It is only a matter of time that a rating system based on such indexes becomes widely adopted.

This doesn’t bode well for regions that continue developing along the last centuries model of outer suburban development. At some time a comprehensive index will be developed to help home buyers make informed decision. And once this occurs it will be much easier to make regional comparisons. Perhaps regional leaders ought to ready their communities for this new playing field on which to compete.

According to the H+T Affordability Index Lake and Porter counties in Indiana (where I call home) don’t measure-up so well.

In the lefthand map above, the yellow areas show where housing is less than 30 percent of average income and the blue areas show where it’s more than 30 percent. On the righthand side, the yellow areas show where housing costs plus transportation costs are less than 45 percent and the blue areas show where that combined measure is more than 45 percent. It’s an indirect comparison, but as you can see, a lot of places look cheap when you just look at housing (on the left), and that picture changes when you factor in transportation.

To make matters worse if you factor in the additional costs of living in Lake County, it simply doesn’t make sense for a home buyer to burden themselves with such overwhelming costs.

Additionally, how would Lake County measure-up if we also factored in costs associated with industrial pollution?

• Lake county’s air-shed ranks 9th of 3140 counties as the most polluted.
• Lake Counties waterways are also some of the most polluted in the country.

What if this index was combined into an Energy Performance Scorecard (EPS) for home buyers to make a more accurate assessment of the value of a potential purchase? Shouldn’t all costs associated with the purchase of a home be made available to the buyer as part of disclosure.

Thomas Case Studies, Economics, Energy, Environment, Information Graphics

The Pollution that Pollution Creates.

It takes a village to damage a community, future generations and the environment. This is how it happens in Northwest Indiana.

via [ NWI Times ]

BP in Whiting has invested $100,000 in 2009 in the East Chicago Carnegie Arts Association to be used toward operating expenses. Show from left to right are Dave Ryan, executive director Lakeshore Chamber; Kathleen Oppolo, Carnegie Arts Association board member; East Chicago Mayor George Pabey; Lisa Woodruff Hedin, executive director Carnegie Arts Association; Tom Keilman, director of government and public affairs BP Products North America; Mike Ebert, co-chair Carnegie Arts Association; Lauren Bukovac, campaign coordinator Carnegie Arts Association

Thomas Energy, Environment, General Arts

With such a concentration of heavy industry, Northwest Indiana depends on an array of dirty power plants to generate the needed electricity.

via [ Post-Trib ] NIPSCO plant makes dubious national list - Four area plants named in report on CO2 emissions By Gitte Laasby

Northern Indiana Public Service Co.’s R.M. Schahfer Generating Station in Wheatfield is the 43rd-dirtiest power plant in the nation in terms of greenhouse gas emissions, according to a report released Tuesday.

The report also states that Indiana power plants emitted the fourth-most carbon dioxide pollution in the nation in 2007.

Four of Northwest Indiana’s power plants are mentioned in the report by Environment America, “America’s Biggest Polluters: Carbon dioxide emissions from power plants in 2007″: The R.M. Schahfer Generating Station, Michigan City Generating Station, Bailly Generating Station and Whiting Clean Energy. Combined, they emitted more than 18.9 million tons of carbon dioxide in 2007. That’s the equivalent of more than 3.3 million cars.

Power plants are the single-largest source of the country’s carbon dioxide emissions, according to the report. The emission numbers come from the U.S. Environmental Protection Agency’s acid rain program, which requires power plants to report certain emissions.

“America’s fleet of coal-fired power plants emitted more than 80 percent of CO2 pollution from U.S. power plants in 2007 and 36 percent of the total U.S. CO2 pollution, as well as disproportionate amounts of smog- and soot-forming pollutants, toxic mercury, and other toxic air pollutants,” the report says.

Gabriel Filippelli, chairman of the Department of Earth Sciences at Indiana University-Purdue University-Purdue at Indianapolis, said cutting emissions is key to avoiding the most dangerous effects of global warming, but would also reduce soot pollution, which can lead to asthma, and mercury pollution, which can damage the nervous system.

About half of the country’s electricity comes from coal, which has the highest carbon content of any fossil fuel per unit of energy, according to the report.

“We should be moving to clean, renewable energy like wind and solar. At least, old and new plants should be required to meet the same modern standards for global warming pollution. No plants currently have to meet standards for global warming pollution, making them unchecked contributors to global warming,” said Megan Severson, Midwest field organizer for Environment America.

The EPA has proposed requiring new and significantly modified power plants and industries to cut their greenhouse gas emissions. Within a few months, the U.S. Senate is expected to consider a cap-and-trade proposal to limit greenhouse gas emissions.

Older plants pollute proportionally more than new plants. Plants built before 1980 produced 73 percent of America’s carbon emissions although they represent less than half of the plants, the report said. For each year older a coal generator is on average, it creates an additional kilo of carbon dioxide per megawatt hour of electricity it produced.

Severson said older plants emit more carbon dioxide because newer plants burn natural gas while older ones mainly burn coal. She said efficiency may be another reason newer plants emit less than older ones, but couldn’t elaborate.

NIPSCO plant makes dubious national list :: Local News :: Post-Tribune.

[ Report ] By the Environment America Research and Policy Center

Thomas Energy, Environment

via [ The Oil Drum ]

The data in the table originate from “Energy demands on water resources”, report to the congress, 2006 [ link ]

For the past century, America has invested significant research, development, and construction funding to develop both fresh surface- water and groundwater resources. The result is a water infrastructure that allows us to harness the vast resources of the country’s rivers and watersheds, control floods, and store water during droughts to provide reliable supplies of freshwater for agricultural, industrial, domestic, and energy uses. During this same period, the U.S. developed extensive natural resources such as coal, oil, natural gas, and uranium and created an infrastructure to process and transport these resources in an efficient and cost-effective manner to consumers. These two achievements have helped stimulate unprecedented economic growth and development.

However, as population has increased, demand for energy and water has grown. Competing demands for water supply are affecting the value and availability of the resource. Operation of some energy facilities has been curtailed due to water concerns, and siting and operation of new energy facilities must take into account the value of water resources. U.S. efforts to replace imported energy supplies with nonconventional domestic energy sources have the potential to further increase demand for water.

ENERGY AND WATER INTERDEPENDENCIES

Water is an integral element of energy resource development and utilization. It is used in energy-resource extraction, refining and processing, and transportation. Water is also an integral part of electric-power generation. It is used directly in hydroelectric generation and is also used extensively for cooling and emissions scrubbing in thermoelectric generation. For example, in calendar year 2000, thermoelectric power generation accounted for 39 percent of all freshwater withdrawals in the U.S., roughly equivalent to water withdrawals for irrigated agriculture (withdrawals are water diverted or withdrawn from a surface-water or groundwater source) (Hutson et al., 2004).

Thomas Energy, The Water I Drink

Stunning!

Each day Humble supplies enough energy to melt 7 million tons of glacier!

The giant glacier has remained unmelted for centuries. Yet the petroleum energy Humble supplies — if converted into heat — could melt it at the rate of 80 tons each second. To meet the nation’s growing energy needs for energy, Humble has applied science to nature’s resources to become America’s Leading Energy Company. Working wonders with oil through research Humble provides energy in many forms — to help heat our homes, power our transportation, and to furnish industry with a great variety of versatile chemicals. Stop at a Humble station for new Enco Extra gasoline, and see why the “Happy Motoring” Sign is the World’s First Choice!

What Would The Humble Oil Ad Look Like Today? : TreeHugger.

Thomas Energy, Environment

Do economists still have the final say on environmental policy?

via [ NY Times ]

A New York University School of Law survey found near unanimity among 144 top economists that global warming threatens the United States economy and that a cap-and-trade system of carbon regulation will spur energy efficiency and innovation.

“Outside academia the level of consensus among economists is unfortunately not common knowledge,” Richard Revesz, dean of the law school, said during a press conference on Wednesday. “The results are conclusive – there is broad agreement that reducing emissions is likely to have significant economic benefits.”

The law school’s Institute for Policy Integrity sent surveys to 289 economists who had published at least one article on climate change in a top-rated economics journal in the past 15 years. Half of those economists responded anonymously to a dozen questions that solicited their opinions on a range of issues, from the impact of climate change on particular industries to how the benefits of reduced greenhouse-gas emissions should be calculated.

Economists Concur on Threat of Warming - Green Inc. Blog - NYTimes.com.

Report [ Economists and Climate Change ] from the Institute for Policy Integrity

Executive Summary

The Institute for Policy Integrity surveyed a group of the top economic experts on climate change to solicit their views on several key questions that affect climate change policy. The pool of economists was selected by searching the top twenty?five economics journals over the past fifteen years and identifying all articles related to climate change. The roughly 300 authors of those articles were contacted and sent a survey, and more than half replied. The results showed surprising consensus on some questions, but continued debate on others.

The results were:

• 84% of respondents agreed or strongly agreed that “the environmental effects of greenhouse gas emissions, as described by leading scientific experts, create significant risks to important sectors of the United States and global economies.”
• 75% agreed or strongly agreed that “uncertainty associated with the environmental and economic effects of greenhouse gas emissions increases the value of emission controls, assuming some level of risk?aversion.”
• Agriculture was the domestic economic sector most identified as “likely to be negatively affected by climate change,” with 86% of respondents selecting this sector.
• 91.6% preferred or strongly preferred “market?based mechanisms, such as a carbon tax or cap?and?trade system” over command?and?control regulation to reduce greenhouse gas emissions.
• 80.6% preferred auctioning carbon allowances rather than freely distributing allowances.
• 97.9% agreed or strongly agreed that “placing a ‘price on carbon’ through a tax or cap?and?trade system will increase incentives for energy efficiency and the development of lower?carbon energy production.”
• 57% agreed that the U.S. government should commit to greenhouse gas reductions “regardless of the actions of other countries,” while an additional 15.5% agreed that it should do so “if it can enter a multilateral emissions reduction treaty with some countries,” and 21.8% agreed the U.S. should move forward “if other major emitters commit to reducing emissions through a global.” Only 0.7% would wait until all countries commit to action, and 2.1% thought the U.S. should not act regardless of the actions of other countries.
• 92.3% agreed or strongly agreed that “most of the environmental and economic effects of greenhouse gas emissions will be felt by future generations.”
• 37.5% responded that “benefits to future generations” should be evaluated “by discounting them at a constant discount rate,” while 36.8% stated that they should be evaluated “by using alternative discounting methodologies (such as hyperbolic discounting),” and 16.7% stated that they should be evaluated “by reference to moral inquiries unrelated to discounting.”
• The median value for a discount rate used to evaluate impacts on future generations, if discounting was to be used, was 2.4%, but there was wide variation, suggesting that there is no clear consensus.
• The median social cost of carbon estimate was $50, but there was very wide variation, suggesting that there is no clear consensus on the exact extent of the harm created by each unit of greenhouse gas emissions.

Thomas Energy, Environment

[ Green for All ]

“When we think of a green economy, it should be an economy where we don’t have any throw away resources. We don’t have any throw away species. We don’t have any throw away children or neighborhood either. We don’t have any throw away nations either.”

- Van Jones

As a resident of East Chicago Indiana this message resonates with me.

Update (9-6-09): Van Jones resigns.

Update (9-5-09): Since the right has turned the heat up on Van Jones in an effort to discredit him and weaken the efforts he has championed, I thought it important to repost this video.

I live in an industrial fenceline community which is home to mostly poor minorities, and I have been apart of regional planning efforts that have not been too kind to them. If you follow this blog you will undoubtedly recognize that the population that lives here does not share in the quality of live most Americans have come to know.

Based on my experience I would say Van Jones’ criticism of industrial policy isn’t strong enough. Not only do East Chicago and Gary receive a disproportionate share of the negative externalities of industry (pollution, disinvestment, congestion, neglect, and the occasional explosion), they also receive a disproportionate share of the benefits. With a low industrial tax rate, these communities receive very little tax benefit. The political leadership has also awarded these industries with tax abatements (BP recently received a $165 million tax abatement in East Chicago). These communities also receive very little wage benefit to support the local population, as most wage earners and contractors choose to live in other less polluted middle-class communities. Most economic development dollars received by industry also go to other less polluted middle-class communities.

One other very important fact that needs to be better articulated is how these industries crowd out, or hold down other markets. This can be attributed to the negative externalities, and the general lack of quality of life.

One example of how this has effected other markets is what happened twenty-five years ago when BP, then Standard Oil, was forced to relocate there professional training facility from Whiting Indiana to Naperville Illinois. They simply could no longer attract professionals to the region due to quality of life issues. They ended up donating their whiting facilities to St. Joseph College. Today, BP’s Naperville facility is a LEED certified campus.

You can find many examples in the housing and retail markets…

Thomas Economics, Energy, Environment

clunk·er (clngkr)

The Clunker Stimulus and Emerging Markets

Could the Obama administration be seen as a major turning point in environmental and economic history because of something called the “Cash for Clunkers” Program? 

“In virtually no time, the clunker program has become a national pastime. It has captured the public’s imagination in a way that no other federal stimulus has. Everyone is talking about it. And I truly believe that consumer spirits have been buoyed by the prospect of going out and buying a new car — even with federal assistance, and even under the duress of federal mileage standards. After a very dreary year or two, people might just have fun trading in their clunkers and buying something new,”

- Larry Kudlow

Now that everyone seems happy with Obama’s Clunker Program, it’s time to look at maximizing the benefits. A very clear and obvious question has to do with using tax payer money as a loss leader to finance the program. Certainly the program was meant to kick start a faltering auto industry, and begin to replace older inefficient and environmentally suspect products, but if we take this opportunity we could kick start emerging markets as well. By privatizing the clunker programs we could potentially open a number of new cradle to cradle markets to incentivize the reuse and recycling of materials. 

Granted this model wouldn’t replace the regime of “design obsolescence,” but it would replace basing design obsolescence on the production of inferior materials, manufacturing processes, and technology, with superior materials, manufacturing processes, and technology. This is exactly what we accomplished in the computer industry these past thirty years.

Yesterday I heard on NPR how “Clunkers” are being “killed” and then recycled. As it turns out only the ferous metals are being recycled back into production, everything else is sent to land fills - not a very sustaining prospect for an ecologically minded Administration.

In my mind, it no longer makes sense for governments to clean up behind dirty and wasteful industries to maintain the balance of a sustainable earth. We have lived through the abundance of managing scare resources to having few remaining resources, and now we must manage through a determination of risk. The public burden of excess pollution and waste has become too large to be sustainable. The costs of clean-up projects and waste storage facilities are too taxing on the public wallet, and for those who would like to see lower taxes and a smaller government, they may find shrinking what we put into our land fills as one way to go. 

Beside expanding the salvage market a Clunkers market could lead to the creation of a whole new manufacturing model that incentivizes the design of materials and processes for their life-cycle use and reuse, while limiting waste. In so doing auto manufacturers have the opportunity to expand the resell and reuse of materials from used vehicles. Who knows, some one may even develop a business plan to mine our land fills for used raw materials. 

Thomas Economics, Energy