Saturday, March 8, 2014

Montana Update: CLR Completes Two Bakken Wells In Richland County

In Richland County:
  • CLR, Lepel 1-34H, TD = 14,210 feet; IP of 297 
  • CLR, Levengood 2-5H, TD = 13,818 feetIP of 713 
Italy: How's That Renewable Energy Working Out

Don alerted me to this story. This is a headline Yahoo!Finance story. Reuters is reporting:
The boxy white and grey factory of this rainy northern town makes fewer than half the washing machines it did when Italy joined the euro. It is one of the many symbols of Southern Europe's industrial decline.
Today, however, the Porcia plant is also a testing ground for the region's industrial future.
Home appliance maker Electrolux, which owns the factory, wants to cut the salaries of some 5,000 workers at the plant and three other factories across Italy by up to 15 percent over the next three years. The Swedish company says lowering labor costs is the only way its washing machines, fridges and other home appliances can compete against rival products made in eastern Europe and Asia.
The Italian government, unions and workers say any wage cut would impoverish thousands of families who rely on the plant and its suppliers.
When you go to the linked article, do a word search for either "energy" or "electricity." You won't find either word in the article (with one unimportant exception).

It appears the authors of this article conveniently forgot to mention the cost of energy in Italy.

Italy has one of Europe's highest final electricity prices. In particular, unlike all other countries, price per kWh tends to be lower for lower consumption levels. This policy aims at encouraging energy saving. Higher final prices are also a consequence of the extensive use of natural gas, which is more expensive than other fossil fuels, and the expenses from renewable energy incentives, which is expected to reach a total cost of more than €10 billion in 2012.
Let's highlight that again for those who might have missed it the first time: "... and the expenses from renewable energy incentives, which is expected to reach a total cost of more than €10 billion in 2012."

Also, look at the graph at the linked wiki article for electric energy sources: up until the late 50's, almost all of Italy's electricity came from hydroelectric power; now, most of it from natural gas. Waht changed? The graph is incredible.

Also: note that despite the huge amount of money Italy has put into renewable energy, look at how small a dent wind/solar has made. It's absolutely negligible. This is the pat the Obama administration wants to take the United States. 

How expensive is electricity in Italy. According to wiki, Italy has one of Europe's highest final electricity prices. In fact, Italy has the distinction of having the most expensive electricity outside of that small island country of Malta and another island country, Cyprus.  

The graph at Eurostat shows that Italy's electricity is almost twice as expensive as the rest of the EU. The most recent figures are for 2011, and the price of electricity in Italy has increased year-over-year since 2009. Although another source suggests electricity in Italy costs 22 cents/kwh, this table shows Italy's electricity costs 17 cents/kwh. This compares with:
  • France: 8 cents
  • Germany: 12 cents
  • Estonia: 8 cents
  • United Kingdom: 10 cents
  • Norway: 9 cents
The cost of natural gas in the EU is likely to go up, not down in the next few years. 

It looks like the problem is not the cost of labor, but the cost of energy/electricity. It appears the high cost of electricity in Italy is due simply to policy decisions. By the way, what is the cost of electricity in that other failed EU state, Greece? 11 cents. How can electricity in Greece cost so little. Wiki, again, has the answer:
Almost half (48%) of DEI's power output is generated using lignite, a drop from the 51.6% in 2009.
DEI is the public power company of Greece that accounts for 85% of the country's energy output. 

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