Jason Barton

Professional Information and Energy News

Archive for the ‘The Economy’ tag

Oil Prices Reach Five-Week High

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FEBRUARY 19, 2010


Crude-oil futures ended at a five-week high as U.S. diesel and heating-oil stocks fell, concerns about gasoline supplies emerged and a technical glitch cut output from a North Sea field.

But oil prices gave up some of those gains in late trading after the U.S. Federal Reserve raised its discount rate, the rate it charges banks for emergency loans. In electronic trading, light, sweet crude for March delivery was trading at $78.38 a barrel, after settling up $1.73, or 2.2%, higher at $79.06 a barrel on the New York Mercantile Exchange.

Read the entire article here.

Written by Jason

February 20th, 2010 at 7:59 am

The Clean Energy Gold Rush

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While I’m not in favor of massive government spending to create an industry if there is no true demand, some market based incentives here at home could encourage the growth of some very effective and successful companies. The American entrepreneurial spirit unleashed into today’s global energy markets could lead the world in what has been a market locked into narrow ways of thinking, focused on dwindling supplies of finite resources, mostly imported at high cost from governments we should not be supporting. This market is already changing, and we can lead this change by designing better systems.

Michael Northrop

Michael Northrop

Program Director, Rockefeller Brothers Fund

Posted: February 16, 2010 09:50 PM

Of the 10 largest wind power companies in the world, the United States has one — General Electric. Of the world’s 10 largest solar companies, we have two — First Solar and SunPower – but almost all their manufacturing is in Asia. Hydropower and geothermal companies are also located in the Far East. The U.S., with no national goal or policy framework for clean energy, simply hasn’t found a way to create a stable marketplace where large, renewable energy companies can thrive.

For a nation that consumes 25 percent of the world’s energy, our failure to compete is ominous, and all the more troubling because a veritable “clean energy gold rush” has begun.


China, for one, is sprinting ahead. It has moved swiftly to create goals and policies to capture market share, announcing recently that it will generate 15 percent of its energy from renewable sources by 2020, and that it intends to become the world’s largest exporter of clean energy technologies.

Read the entire article here.

Written by Jason

February 17th, 2010 at 8:15 am

Energy stocks resume their slide after jobs report

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Feb. 5, 2010, 4:26 p.m. EST

By Steve Gelsi, MarketWatch

NEW YORK (MarketWatch) — Energy stocks ended with modest losses Friday as the Dow Jones Industrial Average erased a triple-digit deficit and ended 10 points higher in volatile action.

A mixed U.S. jobs report provided no lift to energy stocks.

While the U.S. unemployment rate unexpectedly dropped to 9.7%, the economy still shed 20,000 jobs in January.

Shares of oil and gas companies initially rose, moved deeply into the red by the afternoon, only to pare their losses by the close.

Crude prices dipped below $70 a barrel, but then abruptly rose later in the day.

Read the entire article here.

Written by Jason

February 7th, 2010 at 7:43 am

China Leading Global Race to Make Clean Energy

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More news about China. There are many arguments, many of which I agree with, claiming that increased government intervention stifles innovation and an effective free market. Yet, in terms of energy, the world leaders are probably Germany and China, socialist and communist countries, respectively. How can this be?

Shiho Fukada for The New York Times

As China takes the lead on wind turbines, above, and solar panels, President Obama is calling for American industry to step up.

Published: January 30, 2010

TIANJIN, China — China vaulted past competitors in Denmark, Germany, Spain and the United States last year to become the world’s largest maker of wind turbines, and is poised to expand even further this year.

China has also leapfrogged the West in the last two years to emerge as the world’s largest manufacturer of solar panels. And the country is pushing equally hard to build nuclear reactors and the most efficient types of coal power plants.

Written by Jason

February 1st, 2010 at 4:15 pm

Energy Spending to Aid Services

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Oilfield services dogged by price shifts


As earnings season heats up, two big groups of companies won’t be enjoying the benefit of easy comparisons to a disastrous year-earlier quarter—energy companies and their handmaids, oil-field services. While the fourth quarter of 2009 was awful for a lot of industries, the energy business was strong.

Read the entire article here.

Written by Jason

January 28th, 2010 at 11:57 pm

Mountaintop Mining: Coal Baron Debates a Kennedy

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If the damage to water quality is as bad from mountain top mining as many say it is, the paychecks these miners earn could have to go to their rising health care costs.

Coal baron vs. Kennedy: Activists, industry in mountaintop mining debate for wide US audience

By TIM HUBER and TOM BREEN Associated Press Writers
CHARLESTON, W.Va. January 22, 2010 (AP)

The real audience for the debate between coal baron Don Blankenship and conservationist Robert F. Kennedy Jr. was not the hundreds who packed the audience at the University of Charleston.


For Blankenship, mountaintop mining puts food on the table and mortgage checks in the mail. For Kennedy, it defaces majestic scenery, pollutes water and shatters the quiet country existence of people who’ve called the mountains home for generations.


“If we can’t have intelligent discourse about the most important issues we face, where are we?” he said. “If we can help people understand it’s a hard issue, that’s a major step forward.”

Read the entire article here.

Big government: Stop!

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Are the measures discussed in these articles just more cases of big government expansion, or are they wise efforts to create a more efficient economy? There’s a theme in today’s posts, looking at the expansion of government, particularly in the energy sector, asking whether or not it is prudent intervention. Clearly the U.S. government has been expanding since well before the current administration, though the past year has seen a new level of growth in government spending. I’ll sit the fence and look forward to your comments and emails.

We’ve heard Dems’ claims that the 16% of our GPD spent on health care is terribly inefficient, so substantial policy is warranted to streamline this important aspect of our economy, especially with the baby boomers reaching retirement.

Many are making similar arguments about energy. For example, approximately two-thirds of electrical energy is lost before it ever reaches homes and businesses. Government expenditures to decrease that waste, it is argued, are prudent investments that will save money in the long run. Conservatives counter that this is a problem best solved by one of our most efficient and effective tools: The free market. The enormous regulation and government involvement strangling utilities preclude a shrewd solution.

I see the validity in each argument, tending at my ideological roots towards the libertarian urge to get government out of as much as possible, but also understanding that a more long-term vision may be needed to encourage necessary change. Highways, telephones, and even the internet are examples of highly convenient aspects of our economy that would not exist were it not for considerable help from the state. Still, each of those sectors grew from substantial demand that made market distortions functional and largely disposable in the end. The auto industry, and to a lesser extent aviation, are examples that one might say have been less successful at making the move from fledglings to the free market.

Clearly there is not a monolithic answer: Government all good or all bad. There are times, such as education and health care, when there is a need for support from the state. Though even then there is a spectrum of ways the government can be involved, ranging from total control to very light intervention that mimics the market. And different approaches are warranted for different sectors. Okay, that’s enough back and forth.

Let me know what you think.

The size and power of the state is growing, and discontent is on the rise

Jan 21st 2010
From The Economist print edition

IN THE aftermath of the Senate election in Massachusetts, the focus of attention is inevitably on what it means for Barack Obama. The impact on the Democratic president of the loss of the late Ted Kennedy’s seat to the Republicans will, no doubt, be significant (see article). Yet the result could be remembered as a message more profound than the disparate mutterings of a grumpy electorate that has lost faith in its leader—as a growl of hostility to the rising power of the state.


There are good reasons, as well as bad ones, why the state is growing; but the trend must be reversed.

Read the entire article here.

Written by Jason

January 26th, 2010 at 9:14 am

California’s agricultural heartland threatens to become a wasteland

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Agriculture has been fascinating to me for so many reasons. This article captures the intersections between economics and resource issues, history and culture. And since everyone eats and jobs are at the foundation of the recovery we need, stories like this speak to many essential issues at once.

The Appalachia of the West

From The Economist print edition

MIKE CHRISMAN looks out from his SUV as he drives through seemingly endless rows of walnut trees on his property near Visalia, in central California. “I have to be optimistic, I’m so tied to this land,” he says. His great-grandfather, after trying his luck in the Gold Rush, settled in Visalia in the 1850s, and the family has been there ever since. But as California’s secretary for natural resources—a job at the intersection of the environmental and farming lobbies, perennially at loggerheads over the state’s scarcest resource, water—Mr Chrisman also knows that optimism has become a minority view.

Read the entire article here.

Written by Jason

January 25th, 2010 at 5:27 am

Drilling Tactic Unleashes a Trove of Natural Gas—And a Backlash

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If there demand is  for natural gas and the technology is feasible, we’ll extract the gas even if the technology for a given location cannot be guaranteed to be safe. If demand is diminished, there is greater opportunity to develop the technology to be safer and more cost effective.We should take advantage of the vast natural gas resources available domestically, and we should do so responsibly and in ways that ensure sufficient energy resources for generations to come.

JANUARY 21, 2010


SHREVEPORT, La.—A mounting backlash against a technique used in natural-gas drilling is threatening to slow development of the huge gas fields that some hope will reduce U.S. dependence on foreign oil and polluting coal.

The U.S. energy industry says there is enough untapped domestic natural gas to last a century—but getting to that gas requires injecting millions of gallons of water into the ground to crack open the dense rocks holding the deposits. The process, known as hydraulic fracturing, has turned gas deposits in shale formations into an energy bonanza.


Matt NagerTrinidad Drilling driller Adam Rios works at the Reveille 1H Chesapeake Energy natural gas site in Fort Worth, Texas, on Nov. 23, 2009.


The industry’s success has triggered increasing debate over whether the drilling process could pollute freshwater supplies. Federal and state authorities are considering action that could regulate hydraulic fracturing, potentially making drilling less profitable and giving companies less reason to tap into this ample supply of natural gas.


“We can now find and produce unconventional natural-gas supplies miles below the surface in a safe, efficient and environmentally responsible manner,” Mr. Tillerson told members of the House Energy and Commerce Committee.


Natural gas heats more than half of U.S. homes and generates a fifth of America’s electricity, far less than coal, which provides the U.S. with nearly half its power. The industry and its allies are promoting natural gas a bridge fuel to help wean the U.S. off coal, which emits more global-warming gases, and imported oil until renewable fuels are able to meet the demand.

What most worries environmentalists isn’t the water in the fracturing process—it’s the chemicals mixed in the water to reduce friction, kill bacteria and prevent mineral buildup. The chemicals make up less than 1% of the overall solution, but some are hazardous in low concentrations.

Today, the industry estimates that 90% of all new gas wells are fractured. Shale—a dense, nonporous gas-bearing rock—won’t release its gas unless it is cracked open, and other types of formations also produce more gas when fractured. Easier, more porous formations, which don’t require fracturing, were tapped in earlier decades and have largely dried up.

On a recent Friday morning, a crew from Cudd Energy Services worked to fracture a Chesapeake Energy Corp. well in Caddo Parish, La., the heart of the Haynesville Shale gas field. While cattle chewed grass in a field across the street, a team of Chesapeake and Cudd employees monitored computer readouts as 21 diesel-powered pumps forced nearly 3,800 gallons of water a minute down a well that reached two miles into the earth.


It is a process Chesapeake says it has learned how to do both efficiently and safely. “We’ve done it 10,000 times in the company’s history without incident,” said Aubrey McClendon, Chesapeake’s chairman and chief executive officer, in a separate interview.

But in a coffee shop in nearby Shreveport, Caddo Parish Commissioner Matthew Linn said he had concerns after more than a dozen cows died during a Chesapeake Energy fracturing operation last year. A preliminary investigation linked the deaths to chemicals that spilled off the well site into a nearby pasture. A Chesapeake spokesman says the company compensated the cattle’s owner and has taken steps to prevent a similar incident in the future.

“I’m all for drilling, and I want to get the gas out from underneath us,” Mr. Linn said. “But at the same time, how do you balance human life and quality of life and clean water against that?”

Natural-gas companies say what’s at work is fear of the new. “When you introduce something like hydraulic fracturing in a part of the country that hasn’t had any experience with it, I think it’s natural for there to be questions about the procedure,” says Mr. McClendon.

Read the entire article here.

UW biomass power plant a gamble for state

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On one hand, the technology the University of Wisconsin is using isn’t as efficient as fossil fuels, so we shouldn’t yet be deploying it on such a large scale. On the other hand, it’s very difficult to increase the efficiency of these renewable fuel technologies on an efficient scale until the investments are made to deploy it, since only then can we see how it needs to be improved. Since we’re fairly confident that the coal and natural gas replaced by these technologies will run out within the next century, perhaps it’s time to invest in biomass, biofuels, and other renewables. I’m not sure, so I’ll sit on the fence for now and continue to argue most strenuously in favor  of energy efficiency.

This article discusses similar technologies as those in another article posted earlier today.

There is also a background article on this UW story here.

By Lee Bergquist and Thomas Content of the Journal Sentinel

Posted: Jan. 19, 2010

A state-funded, $250 million project at the University of Wisconsin-Madison aims to convert a coal-fired power plant on campus to one that primarily burns biomass such as tree trimmings and crops, ideally becoming a model for how the state can reduce its carbon output and its dependence on fossil fuels.

But the massive venture – accounting for nearly one-fifth of the state’s capital budget during the 2009-’11 budget period – faces considerable hurdles. Among them:

• Upfront construction costs will be higher than other alternatives that were considered.

• No infrastructure exists to process the eclectic mix of fuels the plant would burn.

• The plant’s surplus electricity will be sold into a regional market already awash in excess power.


And because of the economic benefits that will accrue to farmers and other local suppliers, state officials believe biomass power plants can help stimulate the market for homegrown fuels.

“We are not just building a power plant,” said David Helbach, a former utility executive and administrator of the Division of State Facilities. “We are trying to jump-start the biofuels market.”

Read the entire article here.