The Clash of Cash for Clunkers

There has been much excitement of late in the press regarding the "Cash for Clunkers" program which has proven so popular that it has run out of money in just a few weeks. From an energy standpoint the program would appear to be a major win all around. Consumers switch from gas guzzlers to high mileage vehicles, the auto industry gets a much needed boost, and the administration can point to at least one set of economic incentives that seems to be capturing the genuine interest of the public. What's not to like?

Actually, I suspect there are a few things not to like. The concept of trading in old low mileage junkers for modern high mileage cars is promising. However, so far, a lot of that promise was wasted. Why? Because the new cars we are helping to subsidize with our taxpayer dollars are often nearly as bad as the cars they started with. With this program one can get a $3500 subsidy for getting a car with only a 1 mile per gallon difference from the old clunker. Now how is that going to have any significant impact on our gas usage in this country? In fact to get a $4500 rebate you only need to do 2 miles per gallon better than your old car. Big whoopee!

If we really want to see this program have a significant impact on gas usage in this country we have to shoot higher than that. What we have right now is really a thinly veiled program for subsidizing the auto industry. That in itself has its merits, though given the fact that our own auto companies don't produce a lot of high mileage cars who we really are subsidizing is the Japanese auto makers. There is no requirement that the trade-in be an American car which I find rather surprising, particularly given the fact that the government owns two of the three major US auto companies. I suspect Japan and Korea could claim protectionism but give the fact that the US government is essentially in the auto business that claim seems a bit thin.

There is also a lot of question in my mind as to what happens to all of those gas guzzling clunkers. The government plan calls for the engines and drives trains to be destroyed though the rest can be used for parts. This makes me wonder if in fact a lot of used car types won't just go get an old engine from the junkyard, one with equally poor mileage, and just replace it. There are a lot of car enthusiasts who would love to revive these old cars which would put us right back were we started from. Hmmm,maybe I am looking on the negative!

OK, so lets look on the positive. The program has run out of money after only a couple of weeks. However, the Democrats are eager to refund it for another $2 billion given that, in their mind, it has been a success. The Republicans of course are opposing it, nothing new there. However, there seems to be some movement within the Republican party to re-vamp the program rather than kill it outright, including requiring higher gas mileage for the trade-ins. This may be one of the very, very few instances where we find ourselves wanting to side with the Republicans.

This program requires some major rethinking. Why not create a sliding scale where nobody gets anything unless there is at least a 10 MPG increase in mileage and only pay above $2000 if there is a 15 MPG improvement. That way buyers will be forced to look at cars with mileage in the 30's and 40's per gallon which will almost surely mean very small cars, hybrids or efficient diesels, all of which would represent an improvement that would actually matter. Also, lets actually junk those cars, all of the car, not just the engine. That way there is less incentive for car enthusiasts to try to salvage the old junkers which frankly we don't want on the road anyway.

If none of these ideas prove politically feasible how about something that would really make a difference. Take the $2 billion dollars and give it to NREL to research building better batteries for electric cars. Then we wouldn't have to worry about MPG ever again!

Editor

The Truly Scary Thing About Palin

Ever since the surprise nomination of Sarah Palin as John McCaine's running mate the press has been filled with stories relating to her lack of experience, her position on abortion and even absurdly irrelevant discussions of her pregnant teenage daughter. All of this has served to distract the public from what may be the strongest problem with Palin as a Vice Presidential candidate, her badly misguided positions on energy policy. Recently CNBC did an extensive interview with Sarah Palin including a frank discussion of her positions on energy policy. We reviewed this interview as well as numerous presentations by Palin on the topic of energy and renewable energy and frankly found it shocking, though not necessarily surprising. After all she is the Governor of Alaska and Alaska gets 80% of its oil revenues from oil and natural gas companies. Nonetheless, in this CNBC interview, had we not known we were listening to the governor of Alaska, we would have guessed that we were listening to a highly paid lobbyist for the big oil companies. She is that pro big oil!

Palin has long been a strong advocate for drilling for oil in the Arctic National Wildlife Refuge (ANWR). When asked about her position on this she said "We need to drill, drill, drill." She has even suggested that she thinks she can persuade John McCaine to approve drilling in the Refuge even though this was one of the rare areas where McCaine disagreed with Bush. She is a big promoter of off-shore drilling and seems to discount any impact the drilling would have on the environment. When the interviewer asked her what the environmental consequences of all this drilling would be she discounted the problem by bascially dissing the environmentalists. She said that the environmentalists were wrong when they said the Alaskan oil pipeline might hurt the caribou herds. She said the herds were fine and therefore drilling in the Arctic Refuge would not have any negative impact. This was a scarily simplistic answer to an important but complex problem, something we have seen all too often from the Republican candidates. Many scientists believe that the oil pipeline did, in fact, impact the caribou herds significantly and that drilling in the arctic would cause even more damage to wildlife because of the nature of the terrain. For an excellent discussion of this see this article from the San Francisco Chronicle appropriately titled "The Last Refuge".

The interviews with Palin are worrisome not only for their content, but for the overall attitude they convey. Palin is not only pro oil, she appears anti-renewable energy. In the interview she acknowledge that her state had vast resources of renewable energy such as wind and tidal energy, and then in the same breath says ""These renewables are not proven to be economic or reliable". Not reliable! Tell that to the millions of people around the world that get their energy from solar, water and wind energy. Not economic! Tell that to the smart people in the energy industry like T. Boone Pickens who are making a nice little fortune creating and selling renewable energy.

Its not only what Palin says that is disturbing it is what she doesn't say. It appears that the term "Global Warming" is not even in her vocabulary. She says "Drill, drill, drill" but she might as well say "Warm, warm, warm" because the inevitable consequence of drilling for more oil is putting more carbon into the atmosphere. Palin was once asked about global warming, she told the conservative Newsmax.com that, while it would affect Alaska more than any other state, "I'm not one though who would attribute it to being man-made." How out of touch can you be!

We strongly urge our readers to take a look at this recent interview with Palin and hear first hand her comments on energy policy. You can find the interview on YouTube at this link: http://www.youtube.com/watch?v=2GE11URmmnc.

A Good Stove is Hard to Find!

This has been one of those weeks where our readers have been keeping us plenty busy. Frequently people write to us with questions about energy and the environment, that is what we are all about after all. Most of the time we can just point to an existing article or get a quick bit of advice from one of the experts that kindly volunteer their time to help us keep you informed. However, this week we got a couple of stumpers that took a bit of time to research. One question had to do with the relative cost effectiveness of electric boilers versus traditional fuel oil boilers. Proved to be a really interesting question which is going to result in a new article in our Saving Energy section. More on that later in the week.

Another question was a request from a reader who was working on a bio-methane project on a farm and wanted to find a methane stove. Seemed like a simple request at first but turned out to be a lot tougher than we thought.

Finding fuel for cooking has long been a major issue in developing countries. Fuel for cooking has become increasingly scarce. In Africa continued drought has killed many trees and plants which were used for fuel. It has also killed off many of the cattle which provided cow dung which was often used for fuel. In other countries deforestation has also eliminated many fuel sources. Moreover, the use of these traditional fuels for cooking inside a home often results in excessive in-door pollution which can severely damage health and increase the spread of disease. Accessible, non-polluting cooking systems are badly needed.

One option which has proven remarkably successful has been low-cost solar stoves. These stoves can be very effective at both cooking and boiling water for sanitation and are being distributed world-wide through the U.N and other humanitarian agencies. To find out more about these types of stoves check out our article on Solar Cooking article in the Solar Energy section of our Web site.

Methane stoves are another excellent option. They are being widely used in many parts of India, Asia and Central America. The approach is ingeniously simple. Often the methane digester is simply an old truck tire inner tube which has been filled with animal waste. The tube is sealed and left in the sun and before long anaerobic digestion occurs and it begins to fill with methane gas. The gas can then be channeled to a stove and used for cooking. One of the best descriptions of this process can be found on a site which describes a methane project in Costa Rica. There is even an instructional video that shows you how to do it. You can find it at: http://www.ruralcostarica.com/biogas-video.html.

In doing research on this topic we found lots of information on how to make methane digesters. What we were not able to find was a company that manufactured small stoves designed to run on methane. We saw a couple of blogs that suggested that regular gas stoves could be used but that the intake orifice on the stove needed to be adjusted for it to work properly. Given that we don't have a resident stove expert on staff, and we haven't a clue what an intake orifice is (at least one on a stove). Therefore we decided we would reach out to all of you to see if any of you have ever come across a methane stove. If so write to us and we will be sure to pass it on to our readers. Also, if any of you are actively involved in any bio-gas projects we would love to have you share your experience with us. Meanwhile keep those letters and emails coming! Keeps us out of trouble:)

Dan

Renewable Energy and the Web

I am always impressed whenever I go to create the News section of EB just how much innovation is going on out there. Sometimes it really gets me thinking. One of the things that grabbed me this week was the information we came across on Enphase energy which has developed a new type of inverter for solar systems called a micro-inverter. Instead of providing a single inverter for all of the solar panels, it has developed a small micro-inverter which attaches to each solar panel individually. This allows the energy signature of each solar panel to separately managed and monitored. This struck us as a significant advance in solar energy, particularly if they can get the costs down on the product (don't have pricing data on it yet) because it allows the solar system owner to really track what is going on with their system at a discrete level. Solar panels are incredibly reliable components but occasionally they do go out. When this happens it might only show up as a slight drop in voltage on one of the strings depending upon where it is placed in the sequence. A homeowner could easily miss it altogether. By allowing it to be monitored individually it would be easy to notice when an individual panel failure occurs.

Another advantage of this type of system is that it allows the power curve for each panel to be monitored separately. Maximum power point tracking (MPPT) can be used with each panel. This function ensures that there is an optimal balance between volts and amps so that the maximum amount of watts of energy is produced. By doing this analysis at the level of each panel rather than all of them at once each panel can be optimized resulting in better overall performance. It is not yet clear whether or not the improved energy output is more cost effective than a single inverter but as component costs come down it seems likely that this is a better approach to power management.

The part about the Enphase inverter that I like the best is that it is Web connected. You can simply log on to to their Website and look up a page that will show you the output of your panels in real time. This strikes me as way cool! It seems to me this has got to be where things are going to go in renewable energy. It is part of the trend we have seen in making the output of a solar system more visible. For some time now inverters have come with displays that can provide detailed information about how your solar panels are performing. More recently, a few inverter manufacturers have made the display devices wireless so that you can mount the display somewhere convenient rather than down in your basement where the inverter probably is located. Moving the display to the Web was the logical next step.

Logical and potentially quite powerful, not only for the individual, but particularly for communities. One of the real trends in renewable energy in Europe has been the move to communal efforts to establish renewable energy. Many communities in Europe have joined together to buy a commercial windmill or a renewable energy system and then share the generated electricity throughout the community. In essence citizens are taking the future of energy in their community into their own hands, often when their governments are not responsive (something those of us in the U.S. are all to familiar with!). For a great discussion of this approach I highly recommend Greg Pahl's book "The Citizen-Powered Energy Handbook" which you can find in our main book section.

It seems to me that putting energy output on the Web would be a huge boost to citizen powered energy efforts because it makes the result of an energy investment so completely visible. At any time a member of the community could log on to the Web and see what type of output their windmill or solar system is providing. They can see the benefit immediately and tangibly. Compare this to the average state utility. Somehow I can't see Con Edison letting me see the output of the electric generators at their local coal-based electrical plant. Could be interesting though, modern home inverters on renewable energy systems actually tell you how many pounds of polluting carbon you are offsetting by not using energy from the grid. Think Con Ed will tell you how much carbon they are putting in the atmosphere?

Now that we have entered the post-peak oil era people are starting to take their energy use a bit less for granted. Making that use easily visible via the Web will make that even easier. Here's an idea; why don't we pass a law requiring all government buildings to use Web based monitor's for their energy systems and then we can see which agency is wasting the most energy. Could be fun!

A Sad Shad Story

Seems like energy issues are everywhere in the news these days, but sometimes the real impact of energy policy is seen, not in the headlines, but in off-beat local stories that make these somewhat abstract issues hit closer to home. I had this experience last week when following a story in one of our local newspapers. I've been living in the Hudson Valley area of New York for about 15 years and one of the things I like about living here is the abundance of local spring and summer festivals that come around every year. Some of them, like the popular Clearwater festival have some national recognition. But my favorites are the really small festivals focused around popular local happenings. One of the best was a little festival held at Croton Park on the Hudson River every year in April when the Shad start their run upriver to spawn.

The festival is called Shadfest, but this year it was a rather different event. That's because this year there weren't any Shad at the Shadfest Festival. Yep, this year it was a "Shadless" Festival so to speak. Why, because the Shad populations have declined so precipitously that the festival managers decided they didn't want to further endanger the fish population by serving them at the festival like they usually do.

In a certain sense not serving Shad at the Shadfest is true to the purpose of the event since because the festival was started 19 years ago by the environmental group Riverkeeper as a way of drawing attention to the health of the Hudson River estuary. Needless to say that its health is more than a little suspect given the decline in the fish populations in the river. A study commissioned by the Riverkeeper which was just released found that there was a 90% decline in the American shad populations in the river over the last 20 years. In the 1940's it was estimated that the shad populations were over 30 million, but now the whole population is estimated to be around 3 to 4 million and only about 200,000 of these come up the Hudson to spawn. At this point the entire species is at risk of disappearing from the river. Biologists from the New York Department of Environmental Conservation (DEC) are particularly concerned that the shad comprising the spawning stock (adult fish) have become smaller and younger, and mortality has increased to excessive and unacceptable levels. Meanwhile, juvenile production dropped to an all time low in 2002 and has not recovered.

There appear to be two primary causes behind this drop in population. One is extensive overfishing on the Hudson. As a result the DEC is in the process of changing fishing regulations so that it is a catch and release program only. This sounds like a common sense action to help the populations, though it is probably coming about 10 years too late. However, the other major cause of declines in the shad population is going to be a bit tougher to solve. That is because the other part of the problem are the numerous power plants on the Hudson River such as the Indian Point nuclear power plant. These power plants suck in huge quantities of water from the river for their cooling systems. When they do this they suck in the eggs of the shad which are then killed by the turbulent water flow. Local environmentalists have long advocated putting filters on the water intakes to help prevent this but the power plants have fought any such regulations. It seems 150% profits per year are not sufficient so the only choice is to save a few cents by killing off the fish populations.

Unfortunately the decline in fish populations on the Hudson is not limited to the shad alone. Last week, Riverkeeper released a study saying that 10 species of Hudson River fish are in decline. The report said shad, alewife and blueback herring are facing disappearance from the river. Riverkeeper aims to get the state to force the five power plants that pull water from the Hudson to cool their equipment, and inadvertently destroy fish larvae and eggs in the process, to switch to technology that uses 95 percent less water and, therefore, kills fewer fish. Indian Point is among the power plants that the group cited.

We support the Riverkeeper organization in trying to get the power plants to behave in an environmentally responsible manner. As much as we tend to talk about global warming on this site the environmental damage from coal and nuclear plants is not limited to just temperature change. Problems like this are yet one more reason why changing over to energy generation approaches such as wind and solar is so needed and so urgent. The cost of continuing to generate energy from coal and oil is, in every sense, just too high!

Is Food versus Fuel Really the RIght Debate?

The bio energy sector of the renewable energy market is under a good bit of fire these days. Seems like everyone, including Congress, is blaming bio fuels for the sudden increase in food prices. Not surprisingly the ethanol manufacturers have gone on the offensive (or is that defensive) in trying to counter this criticism. What's the truth of the situation?

There is no question that ethanol is one of the factors in the rise in demand for corn. According to the Department of Agriculture this year 22% of the U.S. corn crop will go towards producing ethanol rather than fuel. That's up 17% over last year. However, ethanol is not the only factor in the increased demand for corn. The biggest culprit is actually the increased demand for corn from China. Most of this demand is not for feeding the people of China directly, but instead for feeding their cows and pigs. Why, because the people of China and Asia have begun adding meat to their diets, something that used to be a rarity. Weather is also a factor in the current wave of demand. A drought this year in Asia reduced the supply of corn, wheat and soybeans. Imports increased to make up the difference. Finally there is the dollar itself. As the value of the dollar continues to fall on the currency market prices get higher.

As a result of the higher food prices Congress has begun to question the many incentives being provided to the ethanol industry. While this might be a good idea we suspect it is coming about four years too late and for the wrong reason. In our last two presidential election the Red states, most of which are large grain producers, managed to win themselves big government incentives for ethanol. Lost in the rush to win votes was the question as to whether or not ethanol is a particularly good approach for creating fuel in the first place. There continues to be much legitimate debate over the efficiency of corn-based ethanol. At best, according to industry spokesman, the fuel is only 1.25 efficient, meaning it only produces 25% more energy than it takes to make the fuel in the first place. However, recent studies that look at the full production cycle, including the cost of oil-based fertilizers to grow the corn in the first place, suggest that this number is optimistic and that ethanol could be a net negative (see our section on Food vs Fuel for more on this).

Yes, ethanol may be contributing to higher food prices but it is certainly not the only factor. The real problem is that at best corn-based ethanol is only a marginally efficient fuel. There are other renewable energy alternatives that have proven themselves in the marketplace to be far more efficient and effective, particularly wind energy and solar energy, which right now lack government incentives. Congress has still not renewed the renewable energy tax credits for wind and solar despite the fact that they represent probably the greatest energy resource that the U.S. has. Nor has the government invested in supporting the development of electric vehicles which would then make it easy for us to leverage electricity for transportation. If we are going to wean ourselves off of oil and coal and protect the planet the country is going to have to move much more forcefully to support renewable energy solutions. Therefore we support government incentives for renewable energy. But let's provide the most effective incentive for the most efficient renewable energy sources.

We are now in another election year. Let's not make the same mistake this time around. Let's have a real debate on where to put our government's energy dollars. Let's think wisely about how the taxpayer's dollars are used so that it has the greatest impact. Support the candidate that has the best energy policy and encourage your members of Congress to support energy policies that are wise, not just politically expedient.

Investing in the Earth

This morning I perused my newspaper (the New York Journal News) to get a sense of this year's obligatory Earth Day articles. Two articles struck me as particularly interesting. The first article that got me thinking was a local article which reported findings from a consumer research firm (Mintel) that found that consumers were willing to buy green products provided they did not cost 10% more than regular non-green products. My first reaction to the story was that it was presuming the negative. Why shouldn't most green products be even cheaper than regular products. For example, energy saving CFL lightbulbs clearly last much longer than traditional incandescent bulbs and use about one-third the energy. Over their lifetime that represents a significant cost savings. So why do we think of them as more expensive?

The reason we think of them as more expensive is that they cost a bit more up front compared to regular light bulbs. We think in terms of the short term cost, not the long-term value. It struck me that this type of valueless thinking is the antithesis of the values I was raised on. I remember once going to a Sears store with my father so he could buy a new hammer. I remember him pointing out to me that the Sears Craftsman hammers were more expensive than others but that it was important to think about the durability of tools and that an investment in a good tool would always pay off in the long run. It was a good lesson and one that sunk in. To this day I won't buy a cheap tool but insist on going with well-made, quality tools, even though they are more expensive.

What I find surprising is that we won't apply this same logic to products which are good for the environment. We put up a new article this week in the Solar Energy section of the EnergyBible which talks about Calculating Payback on solar photovoltaic systems. What the article showed was that a solar energy system can save homeowners lots of money while doing something good for the planet. What's the drawback, the same as with the CFL bulbs, it costs money up front. It requires an investment! It made me think of a neighbor who recently spent $20,000 to put up a new deck on his house. He argued that it would improve the resale value of his house, an understandable reaction in the rapidly declining housing market. However, I got to thinking that if he had used that same $20,000 to put up solar panels on his roof he would have also have improved the value of his property but in addition he would have dramatically cut his energy bills for the next 25 years. Seems like a no-brainer to me but clearly he didn't see it that way.

Investment was also the theme of another article I saw this morning, though this one was found, not surprisingly, in the business section of the newspaper. The article was reporting on a recent analysis by MP Morgan Securities in which the analyst recommended that investors dump stock in companies which required significant water supplies (power plants for example) in order to create their product. The premise was simple. The supply of water is no longer meeting demand given our rapid population growth so companies that rely on water are going to be at significant risk.

I make no claims on sainthood and so I have to admit my immediate reaction to this article was to conjure up an image of a Wall Street banker who is found deceased in his office, up to his armpits in mounds of cash, who unfortunately died of thirst because there was no water in the water cooler. OK, its a tempting scenario, but the point of all this is that while much of the public is hesitant to invest in a future which will protect our planet, many others who live in the investment sector are willing to invest in the probability that we will fail and that our planet will go down in ruin. It is a morbid way of looking at the world but it is real. There is money to be made in selling the planet short, or more precisely, short selling the planet!

I would like to think that the human race has more sense than this. That we will wake up, smell the coffee, and put our money to work protecting our planet instead of destroying it. However, I suspect it won't be Wall Street investors who make this happen. It will happen when individual investors large and small spend their money wisely, by investing in things that payoff in the long run!