Flow chart of 2011 US energy use

A flow chart released by the Lawrence Livermore National Laboratory illustrates the sources and uses of energy in the United States.  It depicts information about all the energy sources used to power society, as well as the breakdown of how that energy is used - or wasted - in electricity generation, transportation, residential, commercial, and industrial contexts.

On the energy source side, petroleum - oil, gasoline, and similar products - provides the largest share of the energy we consume, slightly more than a third of total energy.  Natural gas comes in second, providing about a quarter of total energy, with coal coming in at another 20%.  Altogether, these fossil fuels provided about 82% of the energy consumed in the U.S. in 2011.  Nuclear power provided about 8% of the energy used.  The remainder came from renewable resources including biomass, hydropower, wind, geothermal, and solar.

About 40% of the energy from these sources was used to generate electricity.  The remainder was used directly for other purposes such as transportation, heating, and industrial processes.

On the use side, transportation consumed the largest share of energy, about 28%.  The industrial sector consumed another 24% of the energy.  Households consumed about 11%, and commercial businesses consumed about 9%.

This analysis of energy use leaves about 27% of the energy unaccounted for.  This energy was consumed in the generation of electricity, but was "rejected", meaning that it could not be captured for a useful purpose.  Waste heat being emitted from a generator is a classic example of this rejected energy.  End users from industry to residences also waste or reject energy; in fact, according to the chart, 57% of the total energy consumed in the U.S. in 2011 was rejected, while only 43% was put to a useful purpose.

Vermont transmission line vandalism

Vermont's electric transmission authority has reported vandalism to a section of high-voltage line connecting Hydro-Quebec's grid to southern New England markets.  According to the Caledonian Record, 167 insulating discs were shot out from a transmission line in the town of Concord, Vermont.

Vermont Electric Power Company (VELCO) manages Vermont's electric transmission system, which includes, 738 miles of transmission lines, 13,000 acres of rights-of-way, 55 substations, switching stations and terminal facilities, interconnection facilities with Hydro-Quebec, as well as fiber optic communication networks that both control the electric system and provide the backbone for high-speed data internet access. VELCO was formed by the state's utilities in 1956 as the nation's first statewide, "transmission only" public utility.

Vandals reportedly used a shotgun to shoot the glass insulating discs which are spaced along the transmission lines and are designed to keep the lines safe from shorting out.  In all, 167 out of over 400 insulating discs were destroyed.  As a result, VELCO depowered the line until the discs could be replaced, which took from last Friday until last Sunday.  The repair itself cost about $250,000, but the biggest cost arose when regional grid operator ISO New England was forced to turn to the spot market to replace the electricity normally imported over the line from Quebec while the line was down.  The cost of that replacement power was reportedly over $1 million per day.

The incident is now the subject of a federal investigation.  Laws enacted after the widespread eastern blackout in 2003 and the September 11 terrorist attacks have increased the penalties for disrupting electric transmission and other infrastructure.  The insulating disc shooting may be treated as a "terrorist act" under federal law.

Transmission lines provide value to society, but are typically expensive and are often located in remote areas.  Hunting often occurs along or near transmission lines; just this year, VELCO won the National Wild Turkey Federation's Energy for Wildlife award for the company’s ongoing commitment to develop and improve wildlife habitat along its rights-of-way.  The extent of the damage to the insulating discs makes the shooting appear to be intentional, and thus more than a "hunting accident".  How will the incident affect transmission line owners' policies about public access to areas near lines?  How can transmission lines be better protected against vandalism?

Connecticut coal-fired power plant air permit issued

The U.S. Environmental Protection Agency has approved a five-year permit for the last coal-fired power plant operating in Connecticut.  The plant, PSEG Power LLC's Bridgeport Harbor Generating Station, can generate 529 megawatts of energy by combusting coal and oil.

While the plant has operated since 1961, its permit renewal was questioned for economic and environmental reasons.  Across the nation, operators of coal plants have announced plans to close or convert plants to other fuels such as natural gas and biomass.  Between the low cost of natural gas - projected to stay low for the foreseeable future - and tighter environmental regulations affecting the electric utility sector, many older and smaller coal-fired power plants are no longer economic to operate.  Additionally, environmental activists have targeted coal-burning plants as polluters, and had argued against the Bridgeport Harbor plant's new permit.

Under the federal Clean Air Act, existing major stationary sources (i.e. those capable of emitting 100 tons per year or more of any criteria air pollutant) must obtain a so-called Title V permit every five years.  Generally, Title V permits are issued by the state or local air pollution control agency, but EPA has 45 days to review any proposed permit and request changes.  In September, Connecticut recommended that EPA renew Bridgeport Harbor's permit.  After the 45-day review process, EPA approved the permit's issuance.

What does the Bridgeport Harbor air permit mean?  Most directly, it means PSEG may continue to operate its plant for another five years -- if it wants to. According to the Connecticut Post, by mid-summer the plant had only operated 24 days this year.  The Bridgeport Harbor plant can provide both baseload power and peaking power needed to satisfy peak consumer demand, but generally the fewer days an asset operates, the harder it is to recover the cost of ownership and operations.

Moreover, coal-fired power plants are declining in the U.S.  This is particularly true in New England, a region far from coal mining.  Will PSEG hold onto the Bridgeport Harbor station and seek another Title V permit in 2017?  For how long will the plant continue to burn coal?  Will PSEG or another owner seek to repurpose the plant to burn other fuels?

Election 2012 and energy recap

With yesterday's general election behind us, people across the United States are considering its impact on energy policy.  From President Obama's retention of the White House to state elections and ballot measures, voters have reshaped the energy landscape.  Here are some highlights:

• President Obama wins reelection.  Obama's win may mean "more of the same" when it comes to energy policy.  President Obama has indicated support for increased domestic production of natural gas and oil, as well as for programs to encourage the development of renewable electric generation.  While the U.S. Department of Energy remains under scrutiny for loan guarantees it offered companies like Solyndra, Obama's reelection likely means that the Department of Energy will not face as strong a shakeup as it would have under a President Romney.  Still, many observers expect Secretary of Energy Steven Chu to be replaced.  The U.S. Environmental Protection Agency will likely continue to develop regulations covering energy-related emissions such as ozone, coal ash, and sulfur from fuels.  These regulations have effectively been on hold pending the election.  EPA Administrator Lisa Jackson may continue to lead the agency.  Likewise, Interior Secretary Ken Salazar has indicated his desire to remain Secretary of the Interior; in Obama's second term, the Department of the Interior is likely to continue its current course in leasing land for oil and gas production as well as for renewable energy production.

• Congress remains divided.  At the federal level, Democrats held onto control of the Senate, while Republicans retained control in the House.  The chambers' partisan nature may lead to gridlock, or at least to consensus-based, relatively moderate measures as the only kind of legislation likely to meet the approval of both chambers of Congress.

• Michigan rejects constitutional amendment on renewable energy.  Michigan voters rejected a proposed amendment to the state constitution that would have increased the amount of renewable energy that utilities must buy to serve their customers.  Proposition 3 would have required electric utilities to generate at least 25 percent of their annual retail sales of electricity from renewable energy sources by 2025.  Only 36% voted in favor of the measure to increase the renewable portfolio standard, meaning the RPS initiative failed.

Other election results, ranging from congressional races to state governor contests, will also shape energy policy in 2013 and beyond.  People and businesses that can react quickly will be in a better position to capitalize on the election results.

How Election 2012 affects energy policy

Today voters across the United States cast ballots in the 2012 general election. At stake are a broad range of political offices, ranging from the presidency to local municipal roles. How will the election's outcomes affect energy policy, energy-related businesses, and consumers?

The presidential contest has drawn the greatest attention over the past year. Whether President Obama will retain his office or Governor Romney will take the White House is the largest question. Based on the candidates' past actions and current campaign platforms, voters have some sense of how each would exercise his presidential powers. On energy issues, both candidates appear to favor increased domestic production of natural gas and oil. The candidates differ in their philosophies on the role of governmental incentives and subsidies -- whether for fossil fuel production or for renewable electricity generation -- and on emissions regulations for coal-fired and other power plants. The candidates also disagree on specific energy projects and programs ranging from the Keystone XL pipeline to the Navy's Great Green Fleet biofuels initiative.

Beyond the presidency, federal elections will determine the composition of Congress. While energy policy is more sensitive to presidential changes than to individual congressional elections, the makeup of Congress drives federal energy policy in the aggregate. All seats in the House of Representatives are up for grabs, as are a third of Senate seats. Of the 33 Senate seats, Democrats need to win 21 seats to retain their majority while Republicans need to win 14 seats to take control. The senators elected in 2012 will participate in setting any national energy policy.

State elections will also shape energy policy for the coming years. Voters will select governors in 11 states, and state legislative offices are widely contested. While federal energy policy draws the most attention, the U.S. federalist system leaves significant authority to individual states to set their own policies on energy issues. For example, states may establish electric renewable portfolio standards or otherwise regulate the resource mix used to produce usable energy. The outcomes of state elections will also affect policies on energy efficiency, smart meters and smart grid infrastructure.

Voters in some states will also cast ballots on measures directly affecting energy policy, such as the Michigan citizens' initiative seeking to increase utilities' use of electricity produced by renewable resources.

It may be some time until all the ballots are finally counted, but by tomorrow night we will have a better understanding of the results for most of the races and ballot questions. Those who can translate the election results into an understanding of future policies - and business opportunities - will have a leg up on the competition.

Hurricane Sandy prompts Jones Act waiver

Hurricane Sandy's disruption of petroleum shipments and refining has led Secretary of Homeland Security Janet Napolitano to issue a temporary waiver allowing foreign oil tankers to enter ports in the northeastern United States.

The Jones Act, a federal law enacted as part of the Merchant Marine Act of 1920, limits who may carry on coastal shipping between domestic ports.  This so-called cabotage law generally requires that all goods transported by water between U.S. ports be carried in U.S.-flag ships, constructed in the United States, owned by U.S. citizens, and crewed by U.S. citizens and U.S. permanent residents.

Hurricane Sandy's impacts to northeastern energy infrastructure included disruption of oil and gasoline supplies in the area near New York City and New Jersey.  Between reduced supply and concentrated demand, gasoline is reported to be in shortage conditions.  Long lines are reported at gas stations, and demand at some stations has led them to run out of gasoline. 

In an attempt to alleviate the shortage, today Secretary of Homeland Security Janet Napolitano issued a temporary, blanket waiver of the Jones Act.  The waiver is designed to allow foreign-flagged oil tankers, that would otherwise be barred from the U.S. coastwise trade, to ship petroleum products from the Gulf of Mexico to Northeastern ports.  The waiver will remain operative through November 13th.

Will Michigan vote for renewable energy as a constitutional amendment?

Voters will decide a broad slate of issues in the upcoming U.S. elections on November 6, including many that address energy policy.  Questions range from who will serve as president to the role of government in managing the mix of energy resources used to power society.  In several states, voters will decide whether to increase renewable energy mandates.  One example of such a question is Michigan Proposal 3, a citizen-initiated ballot measure that would mandate that 25% of the state's electricity must come from renewable resources by 2025.
Under current law, Michigan's renewable portfolio standard requires electric suppliers to procure at least 10 percent of electricity from renewable sources such as wind, solar, hydro and biomass by 2015.  If enacted, Proposal 3 would increase this RPS requirement to 25% by 2025, and limit the impact of the requirement on electric rates to no more than a 1% annual increase.

The official text of Proposal 3 reads:

PROPOSAL 12-3
A PROPOSAL TO AMEND THE STATE CONSTITUTION TO ESTABLISH A STANDARD FOR RENEWABLE ENERGY
This proposal would:

• Require electric utilities to provide at least 25% of their annual retail sales of electricity from renewable energy sources, which are wind, solar, biomass, and hydropower, by 2025.
• Limit to not more than 1% per year electric utility rate increases charged to consumers only to achieve compliance with the renewable energy standard.
• Allow annual extensions of the deadline to meet the 25% standard in order to prevent rate increases over the 1% limit.
• Require the legislature to enact additional laws to encourage the use of Michigan made equipment and employment of Michigan residents.

Should this proposal be approved?
YES __
NO ____

The effort to place this question on the ballot has been led by a group called Michigan Energy, Michigan Jobs.  Supporters project that the amendment would help the local economy by creating over 40,000 jobs and attract $10 billion in new investments, as well as promoting public and environmental health.  Opponents, including a group called the Clean Affordable Renewable Energy for Michigan Coalition or (CARE) argue both that the increased renewable mandate would cost too much and that such a measure does not belong in the state constitution.

How will Michigan voters respond to this issue?  We will find out within the next week.