Notes From All Over -- The Road_To_Minnesota Edition -- October 18, 2021

NFL tonight: Buffalo Bills vs Tennessee Titans. 

Crude oil: up for third day in a row. Highest in seven years. 

Minnesota: "No pipelines for environmental reasons? Fine, deal with the same oil via rail! Congratulation! 👋 Railroad venture boosts the number of oil trains in Minnesota https://t.co/3dwfpwKXAc https://t.co/i9lVeG1gxE" / Twitter. Link here.

Flashback: Huffington Post trying to reassure folks that killing the Keystone XL won't result in more CBR. Originally posted November 9, 2016. Link here. Unless I missed it, the writer conveniently ignored DAPL. From wiki, a reminder of the timeline:

The $3.78 billion project was announced to the public in June 2014, and informational hearings for landowners took place between August 2014 and January 2015. Dakota Access, LLC, controlled by Energy Transfer Partners, started constructing the pipeline in June 2016.

Crude exports by rail: see for yourself. Link here. 

Zillow under pressure. "Absolutely hilarious. Large scale automated house flipping isn't a good idea??? I've been saying this for a while, but I sure $OPEN has cracked the code.... Also jacking up house prices for average Americans is just a terrible idea societally." / Twitter. Link here.

EV Buses -- Minnesota Update -- Proterra, Here We Go Again -- September 3, 2021

Link here. 

Or go direct here.

DULUTH — Ambitious plans to electrify Minnesota transit bus fleets have thus far run headlong into technological problems.

For several years, Duluth and the Twin Cities transit systems have been testing electric buses in an effort to reduce their carbon footprint and air pollution. For the most part, they’re a hit among riders and drivers.

“They’re alright, [a] little more comfortable and a little roomy,” said Cruz Mendoza, a high school teacher, as he rode a bus on his way to a Goodwill in Duluth.

Although the ride is smooth, the transition has been anything but. Duluth recently resolved an array of problems, while Metro Transit’s fleet has been grounded since March of this year because of ongoing problems with their chargers. 

Electric buses in both cities also can’t go as far as a diesel bus in freezing winters, according to transit officials in Duluth, the Twin Cities and Winnipeg.

South Carolina-made Proterra buses were failing on steep hills in Duluth. The buses have experienced cracked chassis that forced Philadelphia’s transit agency to mothball their share of Proterras, although both the manufacturer and the Duluth Transit Agency say the cracks are cosmetic.

Proterra spent years working with Duluth — which has procured seven electric buses — to address the issues, embedding a technician in Duluth for weeks to fix the problem.

Search Proterra on the blog here. 

I guess we might as well use this post as the site to track Proterra. It looks like this story has legs even if the buses don't have promise.

Wind Energy: What An Utter Failure -- PowerLine -- July 9, 2021

From PowerLine, more evidence of the uselessness of wind energy:

Solar: 11% of 12% = 1%
Wood: 18% of 12% = 2% -- wood, twice that of solar and almost as much as wind
Wind: 26% of 12% = 3%

 

 

 At least 60 percent of the time, wind turbines producing no electricity.

Look how many days wind energy approached zero MW production:

And then, look at this: all those unsightly wind turbines producing just 0.17% of their potential output. That's 0.17% -- not 17%, not 1.7%, but 0.17%. Hardly even measurable.

Minnesota Utilty Costs To Increase In 2020 Due To Renewable Energy Costs -- Xcel Minnesota -- January 9, 2020

Anyone paying attention knows what is going on here.

If I was asked to name the one US public utility company that is the face of the renewable energy scam, I would say it was .... drum roll ... Xcel Minnesota.

So, when Don sent me this headline --

... Don also read between the lines ...

... renewable energy is way too costly for customers and there's not enough capacity anyway ..

The headline:

Xcel Minnesota: burning coal seasonally will save customers millions, reduce emissions.

Link here.

Xcel Energy Minnesota wants to burn some of its coal under economic and seasonal dispatch instead of through self-scheduling practices, it told state regulators in December.

The utility submitted a filing with the Minnesota Public Utilities Commission (PUC) to begin offering its two remaining coal plants seasonally into the Midcontinent Independent System Operator (MISO), rather than self-committing the plants to the market, which leads to market distortions, according to research from the Sierra Club and the Union of Concerned Scientists (UCS). The move is part of an ongoing proceeding opened by state regulators in November, and several clean energy groups in the state have been pressing the utility to consider moving away from self-scheduling.

The measures are estimated to reduce customer costs by tens of millions of dollars and 5 million tons of carbon emissions annually by optimizing use of the plants. Minnesota's PUC was the first state commission in the country to open up a docket on this issue, according to UCS Senior Energy Analyst Joe Daniel, whose research implies the market distorting effects of self-scheduling are widespread across regional power markets. 

We'll have to google "self-scheduling" vs "seasonal dispatch" later.

Fifty dollars a year is peanuts ----- except the solar/wind folks told us renewable energy was free and utility costs would go down. Not only are utility costs not going down, they will increase in 2020, according to Xcel Energy.

There are so many story lines here; if I had the time ... but I don't.

But anyone who tells me wind/solar is less expensive than $2-nat gas is full of malarkey -- as Joe would say. 

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EIA Natural Gas Report

Link here.

• prior: - 58 bcf
• most recent: - 44 bcf

Also here. 

Enbridge Line 3: Dead -- June 3, 2019

This is not an unimportant pipeline.

But it is what it is: another "blow" for Canada.

From oilprice:

Enbridge’s Line 3 pipeline replacement project ran into another unsurprising roadblock on Monday after a Minnesota State Court of Appeals ruled that its environmental assessment just wasn’t good enough. The ruling is a reversal of Minnesota Public Utilities Commission’s decision that approved the environmental impact statement for the pipeline replacement.

The project plans to replace Enbridge’s existing 282 miles of 34-inch pipeline with 337 miles of 36-inch pipe. The appellate court found today that the Commission erred when it approved the plan, and found that Enbridge’s environmental impact statement lacked in specificity, specifically where it deals with oil spills in relation to Lake Superior.

The new Line 3 would have the capacity to move 370,000 barrels of oil per day, alleviating the takeaway capacity constraints that Canada is facing. Line 3 is one of two pipeline projects in the works that are—in their unfinished state—keeping Canada’s oil industry from reaching its potential.

At least Enbridge knows what it needs to do: improve its emergency response to any oil spills "in relation" to Lake Superior.

One would think if the emergency response plan is lacking for a new pipeline, the same response plan is inadequate for an aging pipeline. Perhaps the state needs to shut down Line 3 altogether. 

Short term great news for Enbridge investors. No money being spent on an expensive replacement project.

Disclaimer: this is not an investment site. Do not make any investment, financial, job, travel, or relationship decisions based on what you read here or what you think you may have read here.

Enbridge pipelines are tracked here.

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Operator

Operator, Jim Croce

What If Green Energy Isn't The Future -- For The Archives

Minnesota:

• Xcel's plan announced May 20, 2019
• coal-free by 2030
• nuclear-free by 2040
• nuclear currently accounts for 23% of Minnesota's electricity consumption  
• Minnesota nuclear; two plants, nameplate capacity
• Monticello: 671 MW
• Prairie Island: 1,096 MW
• coal
• last two coal plants (to close by 2030)
• Sherco #3 (Sherburne County, unit #3): 876 MW
• Allen S. King: 511 MW
• Natural gas plant expansion
• Mankata Energy: was 415 MW; expansion to 760  MW by 2019
• Renewable energy plans, to add:
• solar: add 3,000 MW
• wind: add 1,850 MW

Comments:

• total nuclear, 2019: 1,767 MW
• total coal that will close: 1,387 MW
• in other words, closing the coal plants will almost be the same as closing the two nuclear plants which account for 23% of Minnesota's electricity generating capacity
• I hope North Dakota and South Dakota are watching 
• it's agreed that the Xcel plant will not be cheap but it won't be much more than rate of inflation

Tight Labor Market; At Record Levels -- WSJ -- February 12, 2019

Link here.

7.34 million unfilled jobs across the US.

Job openings push further into record territory at end of 2018. The number of available jobs exceeds unemployed Americans by one million at the end of 2018.

The article has garnered only two comments. That speaks volumes.

From the linked article:

There were a seasonally adjusted 7.34 million unfilled jobs on the last business day of December.

That was up from a revised 7.17 million at the end November, and surpassed August’s then-record of 7.29 million openings.

The increased openings late last year was followed by robust hiring in January, separate Labor Department data showed earlier this month.

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Also At Record Levels: Canadian CBR

Article at Minneapolis Star-Tribune here. From the article:

Oil imports by rail from Canada have hit a historic high, meaning more oil trains are rolling across Minnesota and raising the alert level of local emergency managers.

Rail shipments from Canada to the United States more than doubled during 2018 as Canadian oil production outstripped the capability of pipelines to ship the stuff, including the six Enbridge-owned lines crossing northern Minnesota.

Oil train traffic through Minnesota from North Dakota was also up noticeably in 2018, though nowhere near peak levels of 2014. The North Dakota rail uptick is largely rooted in oil price shifts.

Canada’s two big railroads, the Canadian National (CN) and the Canadian Pacific (CP), have major routes in the state, the former running through the Twin Ports, the latter through the Twin Cities. The BNSF Railway also moves some Canadian crude in Minnesota.

BNSF said it’s seen a “moderate” increase in Canadian oil shipments. Canadian Pacific declined to release any oil train details. Canadian National said its total oil shipments jumped 77 percent from 2018’s third quarter to the fourth quarter, though it didn’t disclose more specific data.

Over the last four months of 2018, 299 oil trains on the Canadian National’s tracks crossed from Ontario at Ranier, Minn., up from 121 during the same time a year ago.

Oil trains typically have 100 tank cars, each carrying around 30,000 gallons.

The last major CBR accident, Casselton, ND, resulted in a fireball and no injuries, occurred over five years ago. 

Prior to that, a tragic CBR incident occurred in Canada, 

High-profile accidents thrust oil trains into the spotlight a few years ago, the biggest being a fiery 2013 disaster in Lac-Mégantic, Quebec, that killed 47 people. A year later, a BNSF oil train crashed and burned near Casselton, N.D., about 20 miles west of Fargo. Over 1,400 people were evacuated, but there were no injuries.

 I could be wrong but I think there is a solution to all that concern about ever-increasing CBR.

Archived here.

Wait Until Minnesotans Get Their January, 2019, Utility Bills -- Is This A Joke? Timing Is Everything, And Timing Was Atrocious -- January 31, 2019

Out And About For The Day -- Good Luck To All -- October 10, 2017

Source: http://www.visualcapitalist.com/u-s-interstate-highways-transit-map/.

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The Energy And Market Page

Xcel split? Xcel Energy may split subsidiary for Minnesota, North Dakota.

Xcel Energy has proposed splitting its utility operations in North Dakota and Minnesota, telling regulators that widening policy differences between the two states over clean energy have caused stresses that might best be resolved through a breakup.

But a consultant for the North Dakota Public Service Commission is arguing against the separation, saying there would be "no long-term benefits" for North Dakota, only a "substantial likelihood" of higher costs for customers. [Which customers?]

Minneapolis-based Xcel Energy has long had a single subsidiary for its electrical and gas businesses in the two states, Northern States Power Company-Minnesota. Xcel says it's been a successful arrangement for nearly a century, but the policy priorities of the two states began to diverge almost two decades ago, and the best alternative may be a North Dakota subsidiary that wouldn't be subject to regulatory decisions by other states.
Xcel serves around 93,000 electric and 24,000 gas customers in the Fargo, Grand Forks and Minot areas of North Dakota, making it the largest utility in the state. But Xcel says its North Dakota customers consume only about 5 percent of the total load on its upper Midwest system, compared with 75 percent for Minnesota, 15 percent for Wisconsin, with South Dakota and Michigan making up the rest. Altogether, the five-state system serves over 1.6 million customers.

In response to Minnesota's push for cleaner energy, Xcel is phasing out two older coal-fired generators at its big Sherco power plant in Minnesota and has been investing heavily in wind, solar and biomass power. But that shift away from carbon fuels toward renewables comes with costs that Xcel has sought to pass along to customers, leading to pushback from regulators in North Dakota, a major oil, gas and coal producer.

The market. Wow, this market won't quit. All four major indices are up, which I assume means new records are being set. And WTI is up almost 3% on "talk."

NYSE: 191 issues setting new highs, including BP; CAT; CVX (whoo-hoo!); D. R. Horton; KB Home; Oasis Midstream Partners; Wal-Mart;

• new lows: 15

Phillips 66: announces share repurchase program worth $3 billion.

OPEC begs US shale producers to cut production. Yes, that was the headline, "begs." The article actually said OPEC "called on" US shale producers to help OPEC; not sure if the word "begs/begs" was in the story. We talked about this before. Not sure if OPEC understands how "free markets" work. Scary to think Saudi Arabia will IPO an oil company if that's how they think free markets work.

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The Bakken

Active rigs:

$50.94↑↑	10/10/2017	10/10/2016	10/10/2015	10/10/2014	10/10/2013
Active Rigs	57	32	68	190	185

Four new permits:

• Operators: EOG (3); Petro-Hunt
• Fields: Stanley (Mountrail); Charlson (McKenzie)
  Comments: Petro-Hunt has a permit for a Van Hise Trust well in SWSW 28-153-95, Charlson oil 
• field

One producing well (DUC) reported as completed:

• 30285, 1,200, XTO, Stenehjem 31X-28D, Siverston, t8/17; cum 9K in first 19 days;

Fifteen permits renewed:

• Newfield (6): three Sturgeon permits; three Schneiderman permits; all in McKenzie County
• Enduro Operating (4):four NSCU permits in Bottineau County
• Petro-Hunt (3): three Clark Griswold Federal permits in McKenzie County
• Hunt (2): two Halliday permits in Dunn County

Three permits canceled:

• Petro-Hunt: three Mortimer Duke permits in McKenzie County 

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Lake Bowman, Glacier National Park

The Energy And Market Page, T+252 -- September 29, 2017

Wow! NYSE -- 173 issues hit new 52-week highs, including: CAT, FedEx, Home Depot, D.R. Horton, Navistar International,

• new lows: 7

The Trump rally continues to broaden -- Bloomberg. The S&P 500 Index, Nasdaq Composite Index and Russell 2000 Index all moved into record territory, with the S&P 500 benchmark on track for its eighth straight quarterly gain. Financial shares helped spearhead the gains as the KBW Bank Index leaped to the highest since March.

Disclaimer: this is not an investment site. Do not make any investment, financial, travel, job, or relationship decisions based on what you read here or what you think you may have read here.

All aboard! Full steam ahead on UNP dividends -- Morningstar.

Starbucks is changing coffee-purchasing habits: WSJ link. Starbucks is no longer on my daily (or even weekly) things to do. I go to Starbucks when it's about the only option I have (for what I need to get done). I last visited our local Starbucks while waiting for our minivan to have new brakes installed and I noted that things had improved with regard to mobile ordering. From the linked article:

When it comes to mobile payments Starbucks has succeeded where Silicon Valley has generally struggled. But the coffee giant’s advance-ordering process via smartphones hasn’t always run smoothly. Earlier this year, the company admitted that it was getting so many advance orders that the whole process was hurting the in-store experience for those who wanted to wait on line and buy their drinks the old-fashioned way. 

Biomass. If Minnesota doesn't want it, no one wants it. Look at the cost of biomass energy. A huge "thank you" to Don for sending me the link. I would have missed it. But look at the cost of biomass energy -- no wonder a Minnesota utility wants out.

Minnesota utility regulators are studying a proposal by Xcel Energy to close two biomass plants that could mark a turning point for the industry here, particularly as prices for renewable energy drop.

The proposal — which has approval by the state legislature and the communities affected — would close Benson Power, which burns turkey waste and wood, as well as a biomass plant in northern Minnesota owned by the Laurentian Energy Authority (LEA).

Closing the two plants, which make up half of Minnesota’s biomass generation, could cost hundreds of jobs, and state forest management officials and the poultry industry say it will create turmoil among various suppliers to the plants. Their message is simple: slow down.

Xcel has contended the contracts — which in both cases would have lasted roughly another decade — cost too much, especially in light of low wind energy prices. Xcel spokesperson Randy Fordice said in a statement that the “energy generated from these facilities is the most expensive energy on our system and is more expensive than other cleaner renewable sources.”

New wind energy costs Xcel an average of $15 to $25 per megawatt hour (MWh), while biomass is around $150 MWh. All other sources of generation — nuclear, solar, natural gas and coal — are also less expensive than biomass.

Reminder: Europe loves biomass. Europe is paying for wood chips being shipped from southeastern US to the continent. Imagine the additional cost incurred in transporting sawdust. 

The Road To Minnesota

There is a tag "Road_To_Minnesota" but it's becoming a bit unwieldy having to run through all the posts to track that issue.

I will still have stand-alone posts on Minnesota's energy plans but will track them here (if I don't forget) similar to the way I track other on-going stories.

Today's story: journalists in Minnesota really, really excited about Connexus' plant to embark upon a solar-plus-storage project, that when completed, will be the largest in the Midwest. It could be as large as 40 MW -- wow, 40 MW. Connexus is the state's largest electric cooperative. I sure hope the members of the co-op are watching how much they are going to pay for this science project. I think they are going to be sorely disappointed but at least they will go to bed at night feeling good that they are doing their tiny bit to make Algore happy. [Update: one day later -- when trying to find the cost of this solar-storage project, I noted that I made a mistake. This is not a 40-WM project. It's a 20 MW, 40MWh project. It's very, very subtle.]

By the way, from a January 11, 2015, post:

• solar storage cost: 552¢ per kilowatt hour (kWh) on a levelized cost of energy basis” 
• batteries: contribute about 535¢ per kWh to the total costs and the solar PV system would contribute the remaining 17¢ per kWh
• to put this in perspective, the average retail rate of electricity for residential customers in Hawaii is about 36¢ per kWh
• Moodys:  The capital cost of the batteries included in a residential off-grid solar plus batteries system currently cost about $500 per kWh
• to achieve cost parity with the grid, the capital cost of batteries would need to decline to about $20 per kWh, based on Moody’s calculations
• absent a major technological breakthrough, battery costs are likely to remain above $20 per kWh for several decades. In 2012, the U.S. Energy Information Administration projected that battery costs would fall as low as $135 per kWh by 2035 in the best case scenario

The Road To Minnesota Is Not Through North Dakota; Active Rigs In North Dakota Up To 37; The Era Of $100-Oil Is Over -- Oilprice -- Actually, The Era Of $50-Oil Is Over -- November 4, 2016

First things first: now that I've had 48 hours to think about it, my thoughts on the new MacBook Pro. 

Jobs: first stories coming out on the jobs report today are rosy, but by the end of the day we will know how bad the report really is. Again, the numbers underwhelm. The only reason the unemployment rate ticked down was because a larger number of folks dropped out of the labor force. The numbers are bad, not really, really bad, but bad. We'll post them later. I'm getting ready to go biking -- before the rain hits.

First, exploding tablets. Now exploding washing machines. US announces recall of Samsung washing machines. I cannot make this stuff up. Once the s*** starts hitting the fan, I assume the EU will recall Samsung air conditioners. LOL.

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 The Road to Minnesota

See slide 11 of the presentation at this link: http://files.shareholder.com/downloads/MPL/731067126x0x908163/A1A6E7F5-51BE-453C-889E-39580DBFEDC1/ALE_WEB_version_Sept.2016.pdf. These corporate presentations often disappear over time. I have saved a copy for the archives.

Minnesota utility rates: before we get started on this one, just remember two things --

• the US has a glut of natural gas; and,
• natural gas is the least expensive it has ever been

Now back to the story. Here are the data points:

• Minnesota Power asks for another rate increase
• Minnesota Power: residential customers are paying 35% less than the true cost of getting electricity into their homes
• the utility is asking for an immediate 8% increase (as of January 1, 2017)
• the utility will go back for another 10% increase through the lengthy PUC review rate case process
• 8% now, 10% later (neither will happen), and Minnesota Power will still be way below that 35% figure

What happened? If you read the story closely and have been paying attention: two reasons:

• wind energy mandated by voters
• grid enhancement to protect the grid due to the variability, dependability, and inability of wind to respond when needed; very, very complex grid enhancements are needed to protect the grid from wind power

Minnesota Power is being a bit disingenuous in this discussion: they say they went from a 95% coal-generated system as recently as 2005 to a now 30% renewable system (i.e. wind) -- they can't even force themselves to say the word "wind" -- it is such a debacle. The linked article does not mention the word "natural" or "gas."

Get out the violins.

Later, 11:29 a.m. Central Time: a reader corrects me regarding "renewable power" and provides additional background:

Renewable energy from Minnesota Power is mainly hydroelectricity via a contract from the Winnipeg (Canada) area.

Back about two years ago they signed a long term contract to take hydroelectricity as a back-up when the wind quits. In order to do this they are building/have built huge power (electricity) transmission lines from Ontario (province). That is how they derive the 30%  renewable number. Minnesota has a 25% renewable electricity generation law in place.

As we speak, a second coal-fired plant that serves the Twin Cities is being shut down. 

Whatever their utility bills in Minnesota are in 2016, one can expect they will be higher in 2017. And 2018. And 2019.

Later, 12:39 p.m. Central Time: this is what the global warming scam perpetrated by Soros, Obama, and Hillary have brought us to: buying hydroelectricity from Canada to back-up expensive wind instead of home-grown natural gas from North Dakota, and elsewhere.

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Active rigs:

	11/4/2016	11/04/2015	11/04/2014	11/04/2013	11/04/2012
Active Rigs	37	69	190	180	188

RBN Energy: there's a bit of irony here. RBN Energy titles this segment "last mile of the way." The DAPL will be keystoned because they were unable to complete the last 1,000 feet (about a quarter mile). Meanwhile, Texas is laying more pipeline than that in a day. And even the ND regulators are losing patience with the DAPL operators. A new route will be necessary -- which means that, with another environmental impact statement -- this project is dead. 

But I digress. Back to Texas. RBN Energy has another update on moving natural gas to LNG export projects on the Texas coast.

A total of 13 U.S. liquefaction trains with a combined capacity of about 58 MTPA (~8 Bcf/d) are either in early stages of operation along the Gulf Coast or under construction and scheduled to be online by the end of 2019. Of that, about 3.2 Bcf/d is being developed along the Texas Gulf Coast. Beyond that, a “second wave” of liquefaction projects is lining up, with as much as an additional 11 Bcf/d of capacity proposed for Texas by the early 2020s. While many of these second-wave projects may not get built, those that do will require the construction or rejigging of hundreds of miles of pipelines, particularly along that Gulf Coast corridor. Several of the first and second wave liquefaction projects have proposed to build laterals that connect to and branch out from nearby long-haul pipelines, creating new Gulf Coast-bound delivery points for Eagle Ford shale gas as well for supply that will eventually move south from supply basins as far north as the Marcellus and Utica shales. Today, we take a closer look at these liquefaction-related pipeline projects and how they will connect to and impact the existing pipeline network.

Much as the rise of natural gas supply in the U.S. Northeast—traditionally a demand region with minimal supply—has required a massive retooling of the pipeline network, the rise of liquefaction demand on the Gulf Coast (which only a few years ago was planning for LNG imports and regasification) will require a similar retooling. This has already happened with Cheniere Energy’s Sabine Pass LNG’s terminal in Cameron Parish, LA. In order for Cheniere to supply the liquefaction trains, it had to modify and expand its Creole Trail pipeline, which was originally intended to move regasified LNG inland from the terminal, to be bi-directional. Sabine Pass also plans on sourcing a good chunk of its gas from the Marcellus/Utica, piggybacking on the modifications/expansions being made to several big pipelines to move gas south to the Gulf Coast. The same will occur in Texas as additional liquefaction facilities come online there, with the potential to substantially disrupt traditional flow patterns and pricing relationships.

RBN Energy: the list of potential new LNG projects along the Texas-Louisiana coast.

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The Long And The Short Of It

Update on WTI pricing: from what I can see in this long, long Oilprice article, there is nothing new for regular readers, but for newbies, it may be useful. 

The key developments in oil prices from 2007 to September 2016 are highlighted in the following bullet points, in bold red I've added my observation:

• 2007-2008 – EOG Bakken Parshall discovery well in 2007 -- Over a 20-month period, oil prices (average monthly Brent) moved up from $53.68/b in January 2007 to 113.02/b in August 2008 (July averaged $133.16, though oil prices went as high as $147/b). Only 6 of these 20 months saw oil prices above $100/b, averaging $88.59/b over the period.
• 2008-2009 – CLR jumps into the Bakken big time -- Over a 7-month period (Sept 2008-March 2009), oil prices moved down from $98.13/b in September 2008 to $40.35/b in December 2008, averaging $56.58/b.
• 2009-2014 – the Bakken hits its stride -- Over a 64-month period (April 2009-July 2014), oil prices remained above $100/b for 42 months, averaging 97.89/b.
• 2014-2016 – Saudi Arabia's trillion-dollar mistake -- Over this 26-months period (Aug 2014-Sept 2016), oil prices moved down from $106.64/b in July 2014 to $46.69/b in September 2016 (with a low of $30.75 in January 2014), so far averaging $54.33/b. However, since August 2015, average monthly oil prices have remained below $50/b.

As for the future:

The oil industry should realize sooner or later that the era of $100/b or over is technically over.

The era of $100-oil is over. LOL. The era of $50-oil is over. WTI is trading down almost another dollar today, and is trading at about $43.50.

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In My Celtic Phase

Through a number of books that I have just completed, I find myself back in my "Celtic" phase.

We have an incredibly good community library here in Southlake, TX. One of the nice things about a very, very good community library is that with a very, very limited budget, their book selections have to be first-rate, and that has been my experience going through the stacks.

Today, I noted that they have an earlier edition of the a world history book that I just bought for our oldest granddaughter who wanted a book on world history: The History of the World, Sixth Edition, J. M. Roberts & Odd Arne Westad, c. 2013, hardcover. So, that was cool. It was the only "real" such world history book on the shelf -- so it confirmed that it was a good choice.

Several books away was an interesting looking one, Egypt, Greece, and Rome: Civilizations of the Ancient Mediterranean, by Charles Freeman, c. 1996: DDS: 909.098 FRE.

I will read selected portions of Freeman's book. I have just finished a chapter on Caesar and his experience with the Gauls (Celts), and so that's where I will start: the Celts and Parthians. 

New Tourist Attraction Planned For Northern Minnesota's Boundary Waters -- August 23, 2016

Regular readers will remember this story (I've re-posted it below the "jump").

Don sends me an update from today's StarTribune. Some data points:

• Great North Transmission Line
• $560 million to $710 million
• three years to build
• one of several that will cross the US-Canadian border
• will help address the intermittent nature of wind power for the majority owner, Duluth-based Minnesota Power
• with wind power on the increase, stable sources of electricity like hydro are needed to fill in production gaps
• Manitoba Hydro is a partner with Great Northern  
• earlier this year, Minnesota regulators approved a new route
• 225-mile-long high-voltage line
• will cross five northern counties through pristine 10,000 border lakes

Local note from International Falls:

The power line, announced publicly in February 2012, is a proposed 500 kV single-circuit transmission line, which will run approximately 220 miles depending on the final route selection. The line will be capable of transmitting at least 883 MW of clean, flexible hydropower and is a part of Minnesota Power’s Energy Forward initiative.

Minnesota Power would pay property taxes on the line, and payments would begin in 2018, with the full amount coming in 2021. The company is expecting to pay $40,000-$70,000 per mile annually on the line.

About $11 million / year "mailbox money" for this transmission line will be paid by the utility rate payers. 

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 Original Post

This was the original post back in May, 2015 (link here).

SeeNews Renewables is reporting:

Minnesota Power has secured a key approval for its plan to build a 500-kV transmission line that will facilitate the delivery of renewable and carbon-free hydropower from the Canadian province of Manitoba to the US state of Minnesota.

The Minnesota Public Utilities Commission has cleared a request for a Certificate of Need for the Great Northern transmission line, according to Allete Inc.

The transmission project will require an investment of [about $750 million]. Minnesota Power will own a majority stake in the system, which will help it deliver at least 383 MW of energy to its clients by June 1, 2020 under power purchase agreements with Manitoba Hydro.

The planned transmission system will allow Minnesota Power to use Manitoba Hydro’s hydroelectric system to store electricity generated by the Bison wind power center in North Dakota. The company commissioned the 205-MW fourth phase of the particular wind project in January 2015, bringing the complex’s total capacity to nearly 500 MW.

As I wrote the reader who sent me the link:

This is really quite a story, thank you.

It is amazing how fast the Minnesota PUC can approve any project with the phrase "renewable energy" in it.

It's interesting that the transmission line is needed to provide back up power for the wind farm in North Dakota. If I read this correctly (and I know I am), Allete has a wind farm in North Dakota. We all know that a) wind doesn't blow at the right speeds all the time; b) the wind farm has a limited life span; and, c) one can't economically store electricity yet. So, the utility needed a back-up plan -- electricity from another source.

So, now, environmentalists can cut the ribbon on a new huge transmission line that will cut through the pristine land of 10,000 lakes.

Wind turbines are depreciated over 7 years; turbines have an expected lifespan of less than 12 years. It appears that the wind farm in North Dakota was used as a cover to get a 500-kV transmission line approved, something that would not have happened had it been for a coal plant out of South Dakota. I hate wind power, but when used as a cover for a huge transmission line, one can't but feel a bit of freudenshade for the Minnesotans.

Meanwhile, a pipeline that no one will see once it is buried, is sandbagged by "environmental groups."

Meanwhile, by law, the utility will be allowed to pass on costs of this new (unneeded) transmission line to its customers. All things being equal, electricity bills will increase in Minnesota once this transmission line is given the final go-ahead.

The likely route for this billion-dollar transmission line, simply required to back up a wind farm in North Dakota:

The Road To Minnesota -- June 17, 2016

Beautiful, beautiful day in north Texas --- but wow, it's hot. I rode my bike up to Starbucks for the first time in about a week -- I suppose it was about 8:30 a.m. when I left the apartment, and it felt like 105 degrees under a hot, somewhat humid, incredibly bright sun. But I see now that it was only 82 degrees, but will get to 97 degrees later this afternoon. I don't know what the high was yesterday, but it was similar I suppose. I took a longer bike ride yesterday, a long circuit around Grapevine with short segments in Colleyville and Southlake: 22.6 miles in the mid-afternoon. I don't think I will do that again, today, but I will be on the bike all day "running" errands.
So, what is being reported over at Google Finance and Yahoo!Finance? Some headlines:

• Rhode Island lost 3,900 jobs over the past two months (1,900 in April; 2,000 more in May) -- a clear signal -- their words, not mine -- that the economy is slowing; 
• housing starts little changed as US construction plateaus; I guess contractors can't find enough skilled workers
• US housing starts fell 0.3% in May
• the next BMW 3 series will be built in Mexico; currently built in Germany and South Africa, the South Africa plant will close and that production will move to Mexico; the Trump Wall will have an express lane to bring BMW's to Americans
• Lumber Liquidators surges after government ends the formaldehyde probe in the company's flooring without issuing a recall; LumLiq is fortunate it did not have "oil" any where in its name
• top story over at Yahoo!Finance has to do with Smith & Wesson; not surprising; SWHC is up 7.4% on a day when the market starts in negative territory
• Beijing bans iPhone 6 in the city; says it's too similar to Chinese phone; Cook must be going nuts
• both XOM and BHP Billiton are considering leaving Australia; dispose of a number of depleting oil and natural gas fields

So, pretty quiet.

I think one of the more interesting stories yesterday was the one Don sent me. I filed it under "no good deed goes unpunished." From my vantage point, Xcel  has gone above and beyond in its efforts to meet Minnesota's ill-thought-out renewable energy mandates. It's expensive. Two to four times more expensive than coal or natural gas. So, Xcel asks for a 9.8% rate increase.

Over three years.

That's about 3%/year. Sure, it's more than inflation forecast and GDP growth forecast, but considering the expense of wind and solar, it seems to make sense. About 10% over three years. Very manageable.

But Minnesota PUC said, "no, go back to the cubicles and come back with a 'better' number."

So, there you have it. Xcel goes above and beyond in efforts to bring mandated expensive wind and solar energy to Minnesotans and the PUC says a 9.8% rate increase over three years is excessive.

Meanwhile, ObamaCare health care premiums are expected to increase 25 - 50%.

Over one year.

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OK, Over to Twitter

Yesterday there was a story -- I'm not going to bother looking for the link -- that (at least some) green energy advocates are looking to nuclear energy as an alternative to natural gas and oil. They've got their work cut out for them. I think this graph as been around for awhile, but it popped up on Twitter again today:

Obviously, no one seriously thinks there will be any significant nuclear power added to the American grid in any reasonable period of time. Has anyone ever seen a flatter line than the "nuclear" line above? But the fact that this has been raised suggests the following comments:

• these same green energy advocates sit at the table when Hillary presides; those in pre-school now might want to start thinking about a career in nuclear energy (see photo below, "Table Talk")
• the fact that some green energy advocates are EVEN thinking about nuclear energy tells me that they see the writing on the wall with regard to wind and solar (take a look at recent op-ed in The Huffington Post about the dirty little secrets of wind energy -- posted a few days ago)
• in the big scheme of things, this has nothing to do with reality; these green energy advocates are looking for a new funding stream as funding for wind/solar starts to dry up
• regardless of what happens, it isn't going to happen for a long time

 Table Talk

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Quick Look At Price Of Oil Over The Years

One last Twitter graph and then we'll close out this post:

There's a very obvious takeaway in that graph.

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How Times Have Changed

It doesn't seem all that long ago when President Obama called ISIS a "JV" team (and he didn't mean a "joint venture" but that wouldn't have been all that wrong either).

Yesterday, according to USA Today:

President Obama said Monday he and military leaders had not discussed sending additional troops to Iraq to fight the Islamic State. There are about 3,500 troops in Iraq.

"This will not be quick — this is a long-term campaign," Obama said at the Pentagon after meeting top military brass in the wake of setbacks that have prompted critics to call for a more robust U.S. response against the Islamic State.

"This will not be quick -- this is a long-term campaign. I'll hand it off to Hillary."

Minneapolis Airport Solar Project Twice The Quoted Rate For Solar Energy Projects At $7 Million / MW; No Problem -- Increase Landing Fees -- No One Will Notice -- December 3, 2015

A solar energy project at the Minneapolis airport came in at twice the going rate for solar energy projects. 

The solar energy project came in at almost $7 million / MW compared to the usual price of $3.5 million / MW and compared to $2 million / MW for wind, and significantly less for natural gas and coal.

From the Minneapolis StarTrib:

Minnesota’s largest solar power project is now generating electricity atop two parking ramps at the Minneapolis-St. Paul International Airport.

The 3 million-watt system containing 8,705 solar panels went online Tuesday, and is expected to supply 20 percent of the electricity used in Terminal 1 and to cut carbon emissions by nearly 7,000 tons per year, airport officials said. [It would be interesting to know how much carbon is emitted by a/c flying into this airport in one day.]

“It is a big deal for us,” said Dennis Probst, executive vice president for the Metropolitan Airports Commission. [At $7 million / MW -- it is a big deal.]

The $20 million solar project is the first of two at the airport. The commission recently approved a plan to install a 1.3 million-watt solar array atop a parking ramp at Terminal 2, at a cost of $8.5 million. Construction is expected to begin next year.

Both solar arrays are expected to make money immediately for the airport — with 30-year savings of $10 million on the first project, and about half that on the second, smaller project.

The $20 million project for 3 MW = almost $7 million / MW.

The smaller project comes in about the same price / MW. At $8.5 million / 1.3 MW = $6.5 million / MW.

Interestingly enough, the $7 million / MW price tag is similar to the $6 million / MW price tag at a Milwaukee, WI, airport. Something about airports? Not a problem: simply increase the landing fees which will then be passed on to fliers (compare your airline tickets into Minneapolis vs DFW).

Disclaimer: I often make simple arithmetic errors. If this information is important to you, go to the source, and use a reliable calculator. These numbers are so off the scale, I'm sure I made a mistake somewhere. If indeed the numbers are accurate ($7 million/MW), I would think the state's attorney general might want to have an independent auditor / inspector check into the bidding process.

From an August 25, 2014, post, this is 30-second sound bite for "cost of renewable megawatt":

• Solar: $3 million / MW
• Wind: $2.5 million / MW
• Natural gas: $865,000 / MW

The Road To Minnesota Begins In North Dakota -- October 3, 2015

Updates

October 8, 2015: SC Times applauds Xcel's recent announcement to shut down two coal-burning plants but asks the question, "what's the cost?" LOL. These idiots never talk about the number of coal-burning plants China is building every week. But back to the question, "at what cost." We'll know in a few years. Electricity is so cheap in this country, Americans are willing to pay double just to feel good. Some data points from the article. From wiki: On October 2, 2015, Xcel Energy filed plans with the Minnesota Public Utilities Commission to shut down the plant's Unit 2 in 2023 and Unit 1 in 2026, each with a capacity of 750 MW (Sherco has three units).

• the two Sherco coal plants to be closed: 1,500 MW
• a new 700-MW natural gas plant: $700 million
• 50-MW solar installation: cost not provided, but at $2 million/MW = $100 million

Original Post
 

Perhaps this article is not worth posting. I don't know. But it's clear that I need to add a tag, "The Road To Minnesota." Oh, I see I already have that tag; completely forgot.

Someday, probably in the year 2020, we will see this headline on the op-ed page of the StarTribune: What Were They Thinking?

Anyway, today (October 3, 2015, 12:39 a.m.) the StarTribune is reporting that Xcel Energy plans more wind, solar power and less coal -- and sooner -- in Minnesota. [Actually, Xcel wants more wind, more natural gas, and less coal in North Dakota -- so the headline is wrong on almost all accounts. I guess Xcel will keep solar in the sunny state of Minnesota.]

Oh, that's right. This is why I wanted to post the story.

Earlier I commented on President Obama's Clean Power Act and how it might affect North Dakota in these two posts:

• August 29, 2015
• August 28, 2015

I must have been in a good mood based on the lengths of those two posts. But I digress.

I can't remember if I actually posted this, sent it in an e-mail to someone, or just thought it, but when it comes to the Clean Power Act and the new restrictions, this is an opportunity for North Dakota to really move to a new level in the energy sector.

And there it was, in the linked StarTribune article again.

Although Xcel already intended to double its investments in wind and solar power by 2030, the utility’s revised plan now calls for speeding up that effort, with significant renewable power additions before 2020. Clark said solar and wind power costs have dropped significantly, and he wants the utility poised to seize opportunities if Congress extends the federal wind production tax credit.

Xcel, which operates in eight states and serves 1.4 million electric customers in Minnesota, has been the nation’s most windpower-reliant utility for 11 years. Today, Xcel gets 15 percent of electricity from wind, and 37 percent from coal in its Minnesota region that includes North Dakota and South Dakota. If this plan goes forward, Xcel expects 33 percent of its regional electricity to be generated by wind and solar in 2030, while 15 percent would still come from coal.

Xcel also said it wants by 2025 to build a natural gas-fired generating unit in North Dakota. 

The EPA gave North Dakota a two-year extension to write its plan to comply with the Clean Power Act. What a great opportunity for the state to really put together a great plan.

Wind will continue to be problematic; it cannot be justified on any grounds, but regardless, wind is a sideshow in the energy industry in North Dakota. But look at that last line in the StarTribune excerpt above: Xcel wants to build a natural gas-fired generating unit in North Dakota.

And this comes on top of the possibility of more than one petrochemical plants in the state before it's all over.

*************************************

Using A Fork
She was distracted by the Alabama - Georgia NCAA football game.

Cashwise In Dickinson, North Dakota Opens

The Dickinson Press is reporting:

The Dickinson location has been in the making since March, when Coborn’s, a family owned St. Cloud, Minn.-based grocery retailer, acquired the site of the former Kmart in the Prairie Hills Mall.

Sellers, who was brought on to the project in April, said he has directed eight stores in the past and has opened 12.

He said the Dickinson store will be one of the largest Cash Wise locations at 100,000 total square feet with a 70,000-square-foot sales floor.

Next time I'm in the Dickinson area I will stop by; compare this Cashwise with the one in Williston. 

It looks like Cashwise is along I-94 and I-98.

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EIA "Energy Cookie"

Today's "energy cookie":

Sanctions imposed by the United States and the European Union (EU) at the end of 2011 and during the summer of 2012, respectively, led to the displacement of more than 1.0 million barrels per day (b/d) of Iranian crude oil on the global market.

Iran's main buyers in Asia, Europe, and elsewhere have replaced Iranian crude oil with barrels from other members of the Organization of the Petroleum Exporting Countries (OPEC).

If oil-related sanctions are lifted, Iran will look to regain export market share, competing with other OPEC members with similar crude oil grades…Iran's crude oil and condensate exports averaged 1.4 million b/d in 2014. In 2011, prior to sanctions, Iran exported 2.6 million b/d, most of which went to Asia, particularly China (550,000 b/d), India (320,000 b/d), Japan (315,000 b/d), and South Korea (250,000 b/d). --- EIA

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For Those Who Need More Proof That Minnesota Is Anti-Business

The Park Rapids Enterprise is reporting:

Offutt says the episode has changed his attitude about investing in any new farming projects in Minnesota.

"I would say that the least amount of expansion in the state of Minnesota is the best for our company," he says. "There are other areas in the United States that are a lot friendlier to agriculture and agriculture production than the state of Minnesota is under its present situation."

So, who is Offutt? Perhaps one of those most familiar with good water stewardship.

The patriarch of the biggest potato producer in the world says his company is not the poor environmental steward critics have accused it of being in a snafu over Minnesota water permits.

Ron Offutt, emeritus chairman of the board of R.D. Offutt Co. in Fargo, N.D., says his company got ahead of itself in applying for more preliminary water well permits than it needed or wanted. But that was, in part, a reaction to a changing permit application process and a rare offer to explore buying land from Potlatch Corp., which has sold thousands of acres it had used as timberlands.

In April, Offutt's company appealed a Minnesota Department of Natural Resources decision to require an Environmental Assessment Worksheet for its 56 water permit applications. A court recently agreed to drop the appeal, after Offutt withdrew all but 18 of those applications. The withdrawal prompted some to question why the company was against the environmental assessments.

See also:

• Tax climate for businesses: North Dakota, #2; Minnesota, #47.
• Business climate: North Dakota vs Minnesota.
• Marvin Windows experience.

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I Can't Make This Stuff Up

California's Governor Brown wants the EPA to "tighten US smog standards." His state would be exempt from the standards the governor wants to see imposed on the rest of the US. His rationale is that the state already has stricter goals in play. In addition, and I can't make this up, California, he says, is at the mercy of ozone from China:

Regulators say that ozone travelling from Asia makes it harder for the state to comply with the current standard. Indeed, the head of the San Joaquin Valley Air Pollution Control District warned that “it’s no longer an exaggeration that getting to even 75 ppb is total economic devastation in the timeline that’s proposed."

CO2, fortunately, stays within national borders. That's why no one here in the US is concerned about the 1,000's of new coal plants China is building.

I can't make this stuff up.

Minnesota Could Start Getting Electricity From New North Dakota Coal Plant

Updates

August 23, 2016: Minnesota calls it quits. Won't appeal this further. Agrees to take coal-generated electricity from North Dakota. 

Minnesota will not appeal a federal court ruling that called unconstitutional a law restricting importing electricity from coal-fired electric generating plants.

North Dakota filed the suit against the Minnesota Next Generation Energy Act and won in a federal district court. A federal appeals court panel in June agreed with the district court, leaving the U.S. Supreme Court the only opportunity for Minnesota to win.
But on Monday, the Minnesota Commerce Department and Public Utilities Commission announced the state will not appeal.

The decision means that Minnesota utilities may buy electricity produced in North Dakota plants, where they generate power with locally mined coal known as lignite.
Minnesota's law, designed to reduce carbon dioxide emissions, also bans new coal-fired power plants in the state. That part of the law remains on the books.

Original Post

 

More information regarding Minnesota Senate voting to lift coal restrictions at this link. This is not a done deal yet; the House had to vote (though a House committee approved the bill). The governor has said he supports the bill.

For North Dakota, this paragraph is interesting:

Sponsors of the bill said the immediate impetus is to allow Minnesota's Great River Energy company to sell to Minnesota customers power that's generated by a new plant under construction in North Dakota. The company is not allowed to do so under the restrictions in current law and top state officials in North Dakota, including the governor, have urged Minnesota lawmakers to drop the restrictions.

See original posting here.

With regard to that "new" North Dakota coal-powered electricity plant:

• Known as the Spiritwood Station
• The new coal plant is a Great River Energy product; headquarters in Minnesota
• $350 million coal-fired power plant near Jamestown
• Was to go on-line last year (2010) but project slowed (on verge of stopping) when Minnesota appeared ready to back out of coal-produced electricity
• The new date for the plant to go on-line: January 1, 2012
• This is GRE's first baseload power plant built since 1981
• It will be North Dakota's first coal-fired power plant in a quarter century

This from the AP story today (linked above):

[The] money [that] Minnesota utilities spend on energy produced by burning coal in other states amounts to "dollars out of our communities, dollars out of our pockets we could otherwise use to build homegrown and distributed sources of energy in Minnesota," said Sen. Scott Dibble, DFL-Minneapolis. "It would unwind a tremendous amount of economic progress we're making and could still continue to make."

As noted in the original posting (also linked above), this is a very, very interesting turn of events, assuming the bill is eventually passed. All indications are that it will be passed.  

*********

The rest is just idle rambling about why wind energy will lead to significantly higher costs for public utilities, due to (un)anticipated consequences. 

It should be noted, that all things being equal with regard to energy requirements, wind farms will actually increase the cost of the use of coal by making the coal plant less efficient. Wind will never be able to replace coal. Coal plants will continue to produce the bulk of baseload electricity, but coal plants cannot be turned on and off with a simple click of a mouse button. Even when wind kicks in for surges, coal plants will continue to burn coal as a back-up when the wind ceases to blow. This electricity is not stored. So, unless I'm missing something or don't understand electricity production, the coal plant might be able to reduce the amount of coal being burned (but, wow, that has to be tricky) while turbines are spinning, but the moment the wind stops, the coal plants have to surge. 

It will be very interesting to see peer-reviewed studies ten years from now showing how much less efficient coal-plants will have become due to having to support wind-generated electricity.

If there's a glitch or a delay in the coal plant responding, folks will notice brown-outs or temporary loss of electricity. Maybe surge protectors and or uninterrupted supply units will come back into fashion. I  remember having to buy surge protectors to protect my computer when stationed overseas. I never bought an uninterrupted supply unit but many individuals did, and, of course, businesses will have to have such units.

In addition to burning coal on a "stand-by" basis, the utility will have to invest in sophisticated automated systems to manage the interface of wind-generated electricity and coal-generated electricity. 

As long as I'm rambled this long, I might as well continue. Utilities will pass the cost of additional transmission lines to consumers. Wind-generated electricity will have to be "brought" to the utility or tie in at some substation to be placed on the existing grid. Right now, the grids are in place: a "centralized" power plant with transmission lines going to customers. 

It's been my observation that wind farms are scattered across the landscape, and not centralized to any one location. So, now instead of just outgoing distribution transmission lines, utilities will have to install incoming transmission lines from these scattered wind farms to tie in to the existing grid.

Lots of additional costs associated with wind-generated electricity and with coal burning continuously and less efficiently while wind turbines are turning, it's questionable how much the carbon footprint is being reduced. But it will make some folks feel good to see all those wind turbines.