Blowout week 10

Utilities: RWE posts first ever loss; more UK wind projects cancelled; Marchant – offshore wind too expensive

Shale: Berman sceptical; BP sticks shale ops into separate company; N Dakota getting rich

Ukraine: we have loads of gas in storage; Sochi Paralympics get under way with spectacular fireworks

India: adapts 2050 pathways calculator

Europe: This Is What the Utility Death Spiral Looks Like

The German mega-utility RWE provided another dismal reminder today of the painful transition European power companies are undergoing.

According to 2013 financial results, the utility lost more than $3.8 billion last year as it cycled down unprofitable fossil fuel plants due to sliding wholesale prices. The yearly loss is actually quite historic; it’s RWE’s first since 1949 when the German Republic was formed.

20 stories below the fold…
World: Shale, the Last Oil and Gas Train: Interview with Arthur Berman

How much faith can we put in our ability to decipher all the numbers out there telling us the US is closing in on its cornering of the global oil market? There’s another side to the story of the relentless US shale boom, one that says that some of the numbers are misunderstood, while others are simply preposterous.

UK: Black month for UK renewables as more projects are axed than approved

The UK renewable energy industry has lost 4.4GW of planned electricity generation since the beginning of February – the equivalent capacity of more than two nuclear power stations.

In a series of setbacks to the Government’s legally binding target of matching 15% of the country’s energy needs from renewables by 2020, seven key installations have either been shelved, scaled back or are now stalled in the past four weeks.


Three days ago, the Government of India launched their “India Energy Security Scenarios 2047″ calculator. It reflects seven hard months by a team under Mr Anil Jain at the Planning Commission. They took the UK’s 2050 Pathway Calculator and adapted it for India. In doing it they have both broken the “three articles of civil service faith” and they have improved the tool.

World: BP carves off US shale gas operations into separate unit

BP’S future participation in America’s shale gas revolution has been thrown into question after the UK oil giant said it was separating its US onshore operations into a separate business unit.
The company said it was setting up a distinct business in Houston, separate from its existing US headquarters, that could react faster to the “rapidly changing and hyper-competitive energy landscape” brought about by America’s exploitation of shale gas.

UK: Green Growth Group Ministers’ statement on climate and energy framework for 2030

Green Growth Group Ministers issued the following joint statement on 3 March 2014:
1) We urge the European Council in March to agree on the core elements of a climate and energy framework for 2030.
2) The European Council should urgently agree an ambitious and cost-effective 2030 climate and energy framework, including a binding domestic greenhouse gas target of at least 40%.

UK: Budget 2014 Representation from the Association of UK Coal Producers ‘CoalPro’

Key recommendations of CoalPro’s Budget Representation 2014
1) Freeze and review the Carbon Price Floor at 2014 levels (£9.55t/CO2)
2) Existing coal plants should be able to secure viable Capacity Payments
3) New coal CCS demonstration plants must be prioritised
4) Contracts for Difference for new coal with CCS projects
5) C02 transportation networks must be prioritised
6) Delivering CCS commercialisation and a CCS critical mass

World: Largest oil refinery in europe is on fire

“Neftekamskneftehim” is the largest oil refinery in Europe. It is located in Tatarstan, Russia and today, at 7.00pm Moscow Time, dozens of firemen were urgently summoned as the oil giant started burning.

UK: Energy expert delivers blow to Alex Salmond wind power hopes

AN ENERGY expert has warned offshore wind power may be the “expensive luxury” Scotland can no longer afford.
Ian Marchant, the former chief executive of Scottish and Southern Energy, one of Britain’s biggest investors in renewable energy, fears for the future of the controversial schemes.

Europe: Ukraine crisis: Europe’s stored gas high as prices soar

Gas and oil prices have risen amid fears the Ukraine crisis could have a damaging effect on one of Europe’s main energy supply routes.

But analysts say high European gas stocks will limit the turbulence.

World: Taking the war out of global warming

In this strange universe, the cold war seemed to suddenly return, Ireland began to perform consistently at rugby, and arch-climate sceptics began to believe in dangerous levels of global warming.

World: Matthew Sinclair: Can we really afford to miss out on the opportunities offered by shale gas?

North Dakota used to be poor: in 2001, the state ranked 38 out of 50 in terms of GDP per capita.

Now North Dakota is rich: in 2012, GDP per capita in the state was more than 29 per cent above the US national average. The state also reported the fastest growth in real GDP per capita for the second year in a row.

My selection of stories posted by Luis de Sousa At The Edge of Time. Luis’ focus this week is on Ukraine.

World: Ukraine: Russia holds all the aces

Ukraine is dependent on Russia for energy imports and cannot succeed in armed conflict. Sevastopol on the Crimean peninsula is the home of the Russian Black Sea fleet and the area is therefore of major strategic importance to Russia. I believe the Russians will simply annexe Crimea and protestations from Ukraine, the EU, the USA and the UN will be ignored.

Ukraine is also of major strategic importance to Europe since several gas pipelines cross the country transporting Russian gas to Europe. Europe is also heavily dependent upon oil and coal imports from Russia. And so, when Americans talk of sanctions on Russia they had better come up with a plan B for European energy supplies at the same time.

World: Russia’s Gazprom scraps gas price rebate for Ukraine, offers loan to pay bills

Russia’s gas giant Gazprom has announced it would cancel a price discount for gas supplies to Ukraine. The move follows the overthrow of Moscow-backed president Viktor Yanukovych with whom Gazprom agreed the deal.

World: Europe has little reason to fear Russian gas cut-off

Almost 40 percent of the gas used in Germany comes from Russia. The Baltic States’ dependency is even greater: Russia supplies them with almost 100 percent of the gas they need. Ukraine, too. The crisis in Ukraine, which also depends on Russian gas, has unleashed increasing concern about Europe’s energy supplies. Moscow has been known to employ energy giant Gazprom to serve political ends.

Europe: Europe Gas Storage Seen Enough for 45-Day Ukraine Supply Cut

Europe’s mildest winter since 2007 has left the region with enough natural gas in storage to cover any future disruption in flows from Ukraine for about 45 days.

European inventories were 49 percent full as of March 2,

Europe: Ukraine’s gas stocks can meet four months of demand

Ukraine’s natural gas stocks can meet four months of demand should Russia cut supplies and most of reserves are in its west and far away from any potential Russian intervention, industry sources said.

World: Why Europe will balk at Russian sanctions

Deep economic and business ties between Russia and Europe leave the West with limited options for responding to the crisis in Ukraine.

World: ‘This is war,’ say Kurds in oil fight with Baghdad

Prime Minister Nouri al-Maliki’s dispute with Iraq’s Kurdish minority over its independent oil exports has escalated with the central government blocking Kurdistan’s share of the state budget and banning two airlines that operate between Europe and the Kurds’ semiautonomous northern enclave.

UK: Remote Scottish island runs on green ‘Eiggtricity’

The Scottish island of Eigg is one of the world’s first islands to power itself exclusively with renewable energy. Locals say the change has boosted their quality of life, and that their energy bills are dropping.

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9 Responses to Blowout week 10

  1. A C Osborn says:

    Euan, did you see this article on Ukraine Black Sea Gas, no wonder the Russians are pushing to take over the Crimea again.

    • Euan Mearns says:

      AC, as far as I know the Black Sea (unlike the Caspian Sea) is not a major hydrocarbon province. A few small scrappy fields. I can’t see that gaining access to these would be of much interest to Russia. Nor do I see that preventing access to Ukraine would be of much interest to Russia either. But ownership of this resource is likely to be of great interest to Ukraine and this will make resolving this crisis all the more difficult.

      • A C Osborn says:

        Yes, the point is if the Ukraine can provide for their own Gas needs it removes that big stick Russia keep hitting them with.

        • Euan Mearns says:

          I guess there’s two sides to this. One is that Ukraine keeps failing to pay Russia for gas and the other is that energy dependency on Russia keeps Ukraine in the Russian fold. I just don’t see Ukraine gaining energy independence, unless they are sitting on a great pile of shale gas and oil. A lot of talk at the moment about Europe sending gas to Ukraine – is that Europe sending Russian gas back to where it just came from?

          I think Russian motives are quite simple, 1) get Crimea back since it used to be Russian; 2) protect Russian citizens from what appeared to be a deteriorating pro-European, anti-Russian sentiment and 3) protect strategic base for Black Sea fleet.

  2. Roger Andrews says:

    Anyone who reads the BBC article “Taking the war out of global warming” should skip over the mandatory pour-scorn-on-the-skeptics BS in the introduction and start below the “Sensitive Questions” heading. In contrast to what we usually get from the Beeb it’s restrained, even conciliatory. Consider:

    * It discusses a paper critical of the IPCC written by two “citizen scientists” that wasn’t submitted for peer-review by the global warming gatekeepers and never would have been published if it had been. That’s progress right there.

    * It gives a reasonably fair accounting of what the paper said. It even seems to have the numbers right.

    * It notes that “mainstream” climate scientists haven’t rejected the conclusions of the paper out of hand, which has been SOP up until now. (“While the contribution has not been embraced, it has had a welcome, albeit lukewarm.”)

    * It concludes with the statement: “It may not be a “peace in our time” moment but perhaps it might signal that the time is right for a new, more inclusive debate about climate change.”

    Let’s hope so.

    • Euan Mearns says:

      Roger, I think a lot of people misunderstand the “climate debate”. One facet is scepticism about the integrity and scientific ability of the Climate Science community and the conclusions they draw. And lets face it, with a record like this you’d have to be pretty forgiving to not adopt a critical and sceptical stance:

      The other facet is views on Man’s impact upon climate. Many sceptics are in fact luke warmers and like myself just about slip into the lower end of the official IPCC range (see Table). I’m never quite sure where the main stream sceptics lie but believe Roy Spencer and Judith Curry are both Luke Warmers.

      I thought this from Delingpole was on the money, especially since this team of ex NASA scientists also see limits to fossil fuels. I keep hoping that NASA become more vocal in their criticism of IPCC. The guy I corresponded with when working on cloud data was scathing of IPCC ability.


      • Roger Andrews says:

        Euan: I think the important point here is the implication that the warmists may finally be prepared to discuss the science with the dissenters in an attempt to reach common ground, although this will be the easy bit. The difficult bit will be getting the politicians to stop twisting the facts to suit their agendas.

        Thanks for the link to the NASA study. Their transient climate sensitivity estimates are in line with estimates I made using an empirical modeling approach about ten years ago (I really should post my results more often). The NASA guys are also among the few who do it the right way – they subtract natural temperature increases before calculating TCS. It makes a difference.

  3. Joe Public says:

    “UK: Black month for UK renewables as more projects are axed than approved”

    The alternative title would be “UK: Great month for UK power-consumers as more subsidy-farm projects are axed than approved”

Comments are closed.