Updated: Downturn not hurting everyone

Some companies are getting by ok.

Updated: BusinessWeek offers a profile of the oil giant. Regarding their interest in alternative and renewable energy:

Exxon seems almost blasé about the future of energy. It is particularly out of step with its peers on the issue of alternative energy. Tillerson allows that a shift from fossil fuels is coming, but not for decades. Exxon forecasts that oil and gas will continue to supply 60% of the world's energy needs through 2030, and that a "game-changing" shift to alternatives will begin only after 2050.

On the other side of the debate are the other companies that comprise Big Oil, along with global carmakers, Silicon Valley, and most experts, who speak of a major transformation coming much sooner. With fewer giant oil fields around the world, project costs are rising significantly for the same volume of oil. Add to that climate change, which has created demand for cleaner energy, and you have a formula for an industry in turmoil.

Exxon's rivals are girding for what comes next. France's Total (TOT) says it's evolving into a "power company," touting expertise in building nuclear power plants. Chevron (CVX) is investing in algae. BP has plopped down $500 million to endow a biofuels-development center in California.

In contrast, Tillerson told reporters in January that Exxon isn't investing in existing alternative energy technology because "we think these technologies are old. If there is going to be a fundamental shift" away from fossil fuels, the technology "hasn't been discovered." The company is financing basic research, he said. It will spend $125 million over 10 years at the Global Climate & Energy Project, a Stanford University facility also funded by General Electric (GE), Toyota (TM), and Schlumberger (SLB).

Apart from that, Exxon is not a recognized player among the alternative-energy labs in and around Silicon Valley. Vinod Khosla, one of the world's most aggressive investors in alternative fuels, says he regularly meets representatives of Big Oil, though not Exxon, which "still lives in a different world." Jay D. Keasling, a professor at the University of California at Berkeley whose alternative-energy ideas have attracted about $1 billion in private investment, including $500 million from BP, says he has spoken to Exxon, but that "I think they are going to play a waiting game to see what the other companies do."

Updated: Drought in 2009: snowpack at 61%

The Sierra snowpack is at less than 2/3rds its normal level.

State water officials on Thursday announced that California's snowpack is 61 percent of normal for this time of year, prompting widespread concerns that after two previous dry years, the state appears to be heading for a summer drought that will probably trigger the first widespread mandatory water rationing since the early 1990s.

"The low precipitation in January and snowpack results from today's survey indicate California is heading for a third dry year," said Lester Snow, director of the California Department of Water Resources. "We may be at the start of the worst California drought in modern history. It's imperative for Californians to conserve water immediately at home and in their businesses."

The San Francisco Chronicle also ran some excellent graphics to show the declining snowpack over the last three years (above and below). Scientists of course cannot definitively point to a given drought year and say it is due to global warming but this is not only consistent with what we would expect to see, it is becoming a trend. Drought may be the new "normal". The East Bay is trying to institute incentives and demand pricing with uneven results. The reality is that the true value of water is not yet reflected in the prices we pay.

Updated: Smart grid and green jobs boost in stimulus

Prospects look encouraging for smart-grid efforts to get a big boost from the stimulus package.

Details of the new stimulus package are still being worked out, but talks suggest that about $60 billion will be applied toward promoting clean, efficient "energy independence" and creating jobs in the process.

Billions of dollars are expected to be applied to weatherizing government buildings, schools and homes. Billions more would go to loans and grants to promote renewable energy such as solar and wind. And still more billions would be spent upgrading the infrastructure of America's power grids.

Bringing the power grid into the Internet age is a priority. The bill presented by House Democrats includes $11 billion to boost the IQ of electrical grids by employing sensors to maximize efficiency and minimize waste. An alternative bill introduced in the Senate would raise that sum to $16 billion.

A national smart grid is probably the most urgent investment need to address the energy and climate crisis (that and biofuels). (Updated: Earth2Tech provides an excellent FAQ on smart grid.) This bodes well for Bay Area as many of the top firms are based here.

America's aging power grids now waste 10 to 30 percent of electricity from the generator to the plug, industry experts say. Foundation Capital partner Steve Vassallo likened the grid to a leaky bucket. Instead of simply putting more energy into the system, "the first thing you should do is fix the bucket," he said.

The weaknesses in California's energy grid and marketplace were starkly exposed in 2000 and 2001. Then, as Californians were hit by brownouts and ballooning electricity bills, President George W. Bush refused to support temporary price caps and blamed the energy crisis on environmental rules and a shortage of power plants. Only later was it discovered that energy dealers including Enron, a major supporter of Bush and adviser on Vice President Dick Cheney's energy task force, were gaming California's dysfunctional energy market, profiteering with schemes nicknamed "Death Star" and "Get Shorty." Enron would later implode from its own culture of corruption.

The energy crisis inspired Silicon Valley entrepreneurs to seek solutions. Menlo Park's Foundation started investing in clean tech in 2002, including smart-grid companies Silver Spring Networks, based in Redwood City; eMeter, based in San Mateo; and EnerNOC, based in Boston.

California already growing green jobs faster than any other sector. Even bearing in mind the down-turn, the federal investment seems likely to ensure continued growth

But it's not just California that will benefit. Jobs in the wind industry have already exceeded those in the coal industry.

Wind industry jobs jumped to 85,000 in 2008, a 70% increase from the previous year, according to a report released Tuesday from the American Wind Energy Association. In contrast, the coal industry employs about 81,000 workers. (Those figures are from a 2007 U.S. Department of Energy report but coal employment has remained steady in recent years though it’s down by nearly 50% since 1986.) Wind industry employment includes 13,000 manufacturing jobs concentrated in regions of the country hard hit by the deindustrialization of the past two decades.

Th!nk back from the grave, maybe

Hopefully so.

Offshore drilling - one for Obama's minus column

Offshore drilling plans for California move forward to next step.

Hugh Vickery, a department spokesman, said the department has been notified by the White House that it will be able to proceed with a proposed draft of a five-year plan to lease areas in the Atlantic and Pacific waters for oil and natural gas drilling.

The preliminary plan would authorize 31 energy exploration lease sales between 2010 and 2015 for tracts along the east coast and off the coasts of Alaska and California.

When the plan was unveiled last week, the department said it would provide the Obama administration with the option to begin leasing recently opened areas in 2010, two years before the current leasing plan is set to end.

The department issued a notice Wednesday requesting public comments on the plan. The comment period will be open for 60 days. After that, the Obama administration would have to decide whether to proceed with an official proposal, make changes or scrap it.

This is not surprising given Obama's centrist efforts. His early steps on climate - cabinet, California waiver - remain sterling and the leases could still be scrapped. No word yet on a response from the state but vigorous opposition seems likely.

More worrisome from the article though is the Interior Department's continued move forward on shale oil.

Obama signals likely grant of California waiver

Obama moves to keep his promises.
Reuters reports:

The president told the Environmental Protection Agency to reconsider immediately a request by California to impose its own strict limits on vehicle carbon dioxide emissions, blamed for contributing to global warming.

More from the New York Times

But the centerpiece of Monday’s anticipated announcement is Mr. Obama’s directive to the Environmental Protection Agency to begin work immediately on granting California a waiver, under the Clean Air Act, which allows the state, a longtime leader in air quality matters, to set standards for automobile emissions stricter than the national rules.

California has already won numerous waivers for controls on emissions that cause smog, as opposed to global warming.

The Bush administration denied the waiver in late 2007, saying that recently enacted federal mileage rules made the action unnecessary and that allowing California and the 13 other states the right to set their own pollution rules would result in an unenforceable patchwork of environmental law.

The auto companies had advocated a denial, saying a waiver would require them to produce two sets of vehicles, one to meet the strict California standard and another that could be sold in the remaining states.

The Bush administration’s environmental agency director, Stephen L. Johnson, echoed the automakers’ claims in denying California’s application, ignoring the near-unanimous advice of agency lawyers and scientists that the waiver be granted.

Van Jones on stimulus package

Van Jones during the Select Committee on Energy Independence and Global Warming hearing, "Stimulus Package and Energy: Creating Jobs, Opportunities for All" earlier this month.

Three principles:
1) Return to its roots as number one economy, not because we are #1 consumers but because we are #1 producers - build rather than borrow
2) Get math right - don't just count what you spend, count what you save
3) Connect the people that most need the work to the work that most needs to be done

A powerful vision.

Climate degrading forests

USGS released a new study on the impact of climate change on forests in California and the western states.

Trees in old growth forests across the West are dying at a small, but increasing rate that scientists conclude is probably caused by longer and hotter summers from a changing climate.
While not noticeable to someone walking through the forests, the death rate is doubling every 17 to 29 years, according to a 52-year study published in the Friday edition of the journal Science. The trend was apparent in trees of all ages, species, and locations.

"If current trends continue, forests will become sparser over time," said lead author Phillip J. van Mantgem of the U.S. Geological Survey's Western Ecological Research Center.

"Eventually this will lead to decreasing tree size," he said. "This is important because it indicates future forests might store less carbon than present."

Updated: Steven Chu on climate and action needed & California waiver

Secretary of Energy Steven Chu offers extended comments on climate and the solutions needed.


From Change.gov

Updated: And in further news from the wires:

The starting pistol went off this past week. EPA Administrator-nominee Lisa Jackson strongly indicated that there would be early action on the waiver for California’s motor vehicle GHG emissions standard. Chairman Waxman stated that he wants to report climate change legislation out of the Energy and Commerce Committee before Memorial Day. An Edison Electric Institute statement outlining its “50-50-50” proposal, coupled with the US Climate Action Partnership's “Blueprint” for climate legislation, indicates that we are entering into a new stage of deep industry engagement on policy design.

SolarRed and vacation

Heading on vacation - completely off the net - for the next 10 days so ClimateAtBay will take a break but will pickup later in the month.

In the mean time, check out the new solar startup from San Jose, SolarRed, which aims to dramatically reduce the cost of solar. SolarRed asks:

What if your roof were built for solar panels, and installing them were as simple as snapping panels into place? And what if it didn’t cost you an arm and a leg?

Chances are a lot more people would be going solar today. This is exactly what Solar Red aims to do. Based in San Jose, California, Solar Red is still more concept than product, but their concept won them runner up in the California Clean Tech Open (CCTO), and is poised to entirely disrupt the residential solar market by making it affordable.

More at TriplePundit.

Whither clean-tech in 2009?

With the credit crunch cramping some renewable energy efforts and leading to the demise of some promising prospects like Th!nk. But the upsides - such as dropping prices for silicon and solar panels due to rampup in production - are considerable.

The solar-, wind- and electric-vehicle industries saw strong growth and reached important milestones over the past year. Venture investments into clean-technology companies set new records — a projected $8 billion in 2008, up from $6 billion in 2007.

For 2009, many experts expect the pace of investments to slow, but most still see strong potential and think clean tech will outpace other sectors. The Cleantech Group, a research and strategy firm based in San Francisco, forecasts that clean-tech venture investments will fall to about $7 billion.

Regardless of segment, much of the optimism for clean tech in 2009 is linked to President-elect Barack Obama. His campaign promises and early picks to head key agencies, such as the Department of Energy and the Environmental Protection Agency, have buoyed those in clean tech.

The San Jose Mercury News offers projections for solar, wind, electric cars and efficiency.

SmartMeter coming, hopefully smart grid next

A couple of weeks ago I got a notice from PG&E that they will shortly be installing a "SmartMeter" to replace my current "dumb meter". The principal benefit is that PG&E will be able to get real-time demand data for every location as opposed to currently getting aggregate consumption for every location by sending out a technician to read the meter.

Future PG&E SmartMeter™ program customer benefits:

• Fewer interruptions. We'll collect meter data without setting foot on your property and interrupting your schedule.
  
• Faster power restoration. We'll be able to pinpoint power outages and restore your power faster.


• Faster problem resolution. We'll be able to resolve service problems more easily and, in many cases, without having a service person visit your home or business.


• Better billing. Because we no longer have to depend on in-person meter readings, we'll no longer have to estimate your bill when we can't access your meter.


• Energy usage data. In the future, you'll be able to monitor your own energy usage via the Internet and see when you're using the most energy.


• New rate options. As a result of the SmartMeter program, we'll also be able to offer you more rate choices designed to meet your needs. When these become available, you will be able to better manage your energy consumption and control your energy bills.

This is a good thing. With real-time location information it becomes possible to monitor consumption at any given time of the day and more quickly identify spikes and opportunities for shifting demand, supply and efficiency steps. In a small scale this is the kind of grid innovation that we need at larger scales.

Ultimately, we need the same capabilities at a national scale through a "smart grid". The current US electrical grid which basically was created before cell phones were invented. There has been little substantive innovation in the electrical sector. In fact there has been severe underinvestment.

The average age of power transformers in service is 40 years, which also happens to be the average lifespan of this equipment. Combine the crying need for maintenance with a shrinking workforce, and we may find that the 2005 blackout that affected parts of Canada and the northeastern United States might have been a dress rehearsal for what's to come. Deregulation and restructuring of the industry created downward pressure on recruitment, training and maintenance, and the bill is now coming due.

The OilDrum provides a great primer on the current state of affairs.