The Five Most Important Energy Forecasts of 2008 23 comments
an article to
-
Font Size:
-
Print
- TweetThis
Get ready to make some notes on which energy investments should do well in 2009 and beyond based on what leading experts forecast in 2008 – predictions that have gone largely unnoticed by the rest of the media in the crush of the global credit crisis.
#1 – President-elect Obama, in a cable TV interview on MSNBC on the eve of his election, saying,
One of, I think, the most important infrastructure projects that we need is a whole new electricity grid. Because if we’re going to be serious about renewable energy, I want to be able to get wind power from North Dakota to population centers, like Chicago. And we’re going to have to have a smart grid if we want to use plug-in hybrids, then we want to be able to have ordinary consumers sell back the electricity that’s generated from those car batteries, back into the grid. That can create five million new jobs, just in new energy.
Any longtime energy investor reading this statement can only say, “Wow!” In a matter of seconds, Obama has referenced two multi-billion-dollar investment opportunities that he says will be at the top of his list: energy “storage” and plug-in hybrid electric vehicles (PHEVs).
The first is what will be needed to connect solar, wind and other green power sources into a grid whose stability already is less than desirable. Technologies competing for dominance in power grid energy storage applications include: lead-acid batteries, lithium-ion batteries, flywheels and ultracapacitors. Based on Obama’s statement, companies such as Beacon Power (BCON) (flywheels), Enersys (ENS) (lead-acid batteries), Ener1 (HEV) (li-ion batteries) and Maxwell Technologies (MXWL) (ultracaps) all could see their fortunes improve.
At the same time, it’s clear the US President-elect wants to push for more wind and solar development, which bodes well generally for both of these large energy sub-sectors.
Still, the “Wow!” factor in Obama’s statement comes from his understanding and recognition of the importance of so-called “vehicle-to-grid” technology (V-2-G). That’s stunning because even many clean tech experts have only a dim understanding of V-2-G.
V-2-G requires having a “smart” (meaning computer-controlled) power grid capable of two-way energy delivery. In Obama’s mind, the grid won’t just be capable of supplying the electric fuel for PHEVs. It will also be capable of drawing the power stored in the batteries of millions of PHEVs back into the grid, thereby providing an on-demand back-up power source that not only will stabilize the grid and prevent blackouts, but will also serve to enhance America’s national security by being a completely decentralized source of power.
Thus has Obama signaled his intention to fully support electrified transportation, which could be a boom for some of the same battery manufacturers listed above, as well as for a bevy of car manufacturers and computer software developers such as IBM (IBM).
#2 – Merrill Lynch forecast the “clean” energy revolution will be as big as the Industrial Revolution as the world tries to cope simultaneously with global warming, peak oil and energy insecurity.
“History shows that technology revolutions occur about every 50 years. We believe clean tech is at the beginning of a high-growth period, much like computing was in the early 1970s,” Merrill’s clean-tech strategist, Steven Milunovich, reportedly said, adding that he expects “profound changes” in the energy, utility and automotive industries.
That’s pretty much the entire economy (both businesses and consumers) that Merrill expects to be profoundly changed by the clean energy revolution. Calling it also a profound investment opportunity, Merrill forecast the world will start to see the effects of this new revolution as early as 2010, which suggests that 2009 will be the year smart investors position their portfolios in anticipation of what Merrill also called a new “golden age” of technology.
Merrill believes the clean tech revolution will be led by solar power. It further believes that electrified vehicles will revolutionize transportation and that, because of reliability concerns, on-site generation will compete with centrally-dispatched power from mammoth power plants. The latter suggests a bright future for things like Honda’s (HMC) home fuel cell system, while the former suggests a bright future for the mostly Japanese automakers taking the lead on plug-in hybrid electric vehicles (PHEVs).
#3 – Toyota’s (TM) coordinator for alternatively fueled vehicles forecast there could be a “liquid peak” within a decade, and the company itself warned in a report that with 1.5 billion vehicles expected on global highways by 2020, 600 million more than today, there could be “supply shortages and resource exhaustion.”
By signaling its concern over “peak oil,” Toyota, which has long been at the forefront of technological change in transportation, effectively endorsed the new generation of hybrids, plug-in hybrids and other alternatively-fueled vehicles. That should cause investors to look even closer at the technological leaders in “mild” hybrid technology, lithium-ion battery technology, and more.
Also, with the U.S. having only a handful of entrants in this race to develop the next generation of fuel-efficient transportation, American investors may need to refocus on the leading Asian and European contenders.
#4 – Dan Reicher, director of climate and energy initiatives for Google’s (GOOG) foundation, forecast that “Enhanced Geothermal System” (EGS) technology could be the “killer app” of the energy world. Reicher, whose stature in the “clean” energy world put him on the short list to be energy secretary in the Obama administration, said EGS “has the potential to deliver vast quantities of power 24/7 and be captured nearly anywhere in the world. And it would be a perfect complement to intermittent sources like solar and wind.”
EGS, sometimes called heat-mining, utilizes technology that allows for the capture of the Earth’s own heat when there isn’t a naturally-occurring water source.
Google is backing its forecast with funding for two small private companies, Alta Rock Energy and Potter Drilling. Large publicly-held companies should benefit significantly if Reicher is correct, among them Ormat Technologies (ORA) and Australia’s Geodynamics (GDYMF.PK).
#5 – The head of strategy development and execution for Boeing Co.'s (BA) biofuels program forecast that commercial jets will be flying on biofuel in three to five years, far less time than generally believed.
The Boeing official, Darrin Morgan, said sunflowers and jatropha are closest to being certified, with algae also holding great promise. In an interview with Wired.com, he noted that these biofuels, which will be blended with regular jet fuel, won’t require any engine modifications.
This is tremendous news for the airline industry, which almost went under in 2008 as a result of high fuel prices. With most experts expecting a return to $100+ oil within a few years (as the economy improves), airlines may now be able to avoid further desperate times as they increasingly rely on lower-cost bio-based fuel. In addition, by displacing jet fuel with cleaner-burning biofuel, airlines may not have to pay as much to offset their carbon dioxide emissions in the global cap-and-trade market expected to be up and running in three to five years.
This could also be great news for a company like Honeywell (HON), whose UOP unit is in the forefront of jatropha-based fuel development. It could also be great news for major sunflower seed producers like DuPont (DD). And it clearly suggests that the group of generally small algae development companies in the world should soon have a ready market.
Disclosure: no positions
Related Articles
|
-
The Seeking Alpha 100
See allThe top 100 stock
market authors
selected for publication
Seeking Alpha 100 » -
Fastest Climbers
Authors with the largestSee all
increase in followers
in the last 7 days
Fastest Climbers » -
Top Commenters
Top commenters,See all
as ranked by their peers
Top Commenters » -
Top Instabloggers
The 100 most active
Instabloggers.-
1
David Fry
-
2
TraderMark
-
3
Don Dion
-
4
Cliff Wachtel
-
5
Mike Havrilla
Top Instabloggers » -
1
-
Top StockTalkers
Top
StockTalkers.-
1
David Fry
-
2
Cliff Wachtel
-
3
Mike Havrilla
-
4
David White
-
5
Hedged In
Top StockTalkers » -
1
I am also an engineer.....and people talk like alternative energy is the answer.......I think some of these economists and others need to sit down and start crunching numbers....figuring out how much energy can be provided using these technologies....what kind of baseload power is required....what kind of plants need to be running in case the wind or sun isn't shining or blowing......What are the costs to transfer to these power sources? Are there any material constraints if we massively switched to a certain storage source? etc etc etc.
The scope of such a change is enormous......and we would be moving from an era of extracting energy that is already stored......to an era of harnessing/transmittin... and storing then transmitting and storing again.
In my view, the V2G concept overlooks the critical fact that when you take a PHEV out of the garage it is no longer connected to the grid. So unless we plan a grid expansion and smart metering to every parking spot in America, the bulk of the plug-ins will remain disconnected from the grid during the hours that other grid demands are highest.
The "drill baby drill" mantra is the chant of fools. The EIA report needs to be fashioned into a kite. Then the drill baby drill fools can "go fly a kite baby, go fly a kite"
> jack
Someone PLEASE tell me Obama didn't really say that! Car batteries DO NOT GENERATE ELECTRICITY! Only a totally misinformed person would make such a statement. If he actually said that, then this country has elected a moron.
The problem with alternatives.....is you might need to factor in a large cushion margin of safety.......and need to invest in storage of the energy. While storing energy is smart regardless of where that energy comes from....conventional sources are much more predictable.
So you can build 2MW worth of coal power plants.....and know 2MW worth of energy will be available so long you have the fuel to burn.
With wind.....given its on/off or partial power....if you require 2MW of power.....you will NEED storage....and you might need to build 20MW worth or more....given the terrian to supply a constant 2MW of power.
Now this is a peer example......and did not use any real life numbers....but I think you get the idea.
So if you take 40 quds worth of energy....and want to displace all new energy growth....and displace some energy coming from conventional sources.....you might need to build a capacity of 80-120 quds worth.....I don't know the exact number.
This could equate to building 2,000-3,000 wind turbines with todays technology every week forever and never hit the power desired.
40 quads
80-120 quads
2-3,000 wind turbines installed every week forever
You mentioned line loss over long distances.
That's why all the sensible energy plans call for new high voltage DC transmission lines or HVDC to bring power from solar and wind farms to other parts of the country. There is much less line loss with HVDC over long distances. Anything over 30 miles favors DC in fact. Don't confuse this with the use of superconductors that john s. gordon mentions in his comment.
Andy 1234 -you may be an engineer, but you are under-informed. The numbers have been crunched and these ideas are mostly well thought out. Solar thermal power plants with heat storage can act as base load power, as they produce a steady output of power even at night.
What's more, they can store heat 20-100 times cheaper than storing electricity.
They will be able to provide power at 5-8 cents a kWh once they are up to scale in several years.
They are fast to build and use ordinary building materials. So low tech we could have done it 100 years ago. They can be air or water cooled, and can even desalinize water at the same time, when water cooled. Molten salt is the best medium for storing heat. United Technology's Sunstrand/Rockedyne division has developed advanced systems for molten salt use. They have also created a new solar thermal company called Solar Reserve. There are about 10 companies I've heard of in solar thermal.
See the article in Scientific American that proposes building solar plants in the southwest, achieving 69% solar grid by 2050 and spending less in tax dollars over 35-40 years than we spent on the internet in the last 35 years.
One fourth or less than we now give oil companies in subsidies and tax credits.
www.sciam.com/article....
For more on solar thermal:
www.salon.com/news/fea...
climateprogress.org/20.../
solarsouthwest.org/
Combining centralized solar in the southwest with distributed power from solar panels all over the country will give us solar on a vast scale. Photovoltaics are within a few years of grid parity, not including the external or hidden costs of fossil fuels.
Wind is also much cheaper to build than coal or nuclear plants and about a third the cost of building nuclear. A recent govt report says we could have 20% wind power by 2030. Solar could be bigger.
Geothermal with advanced technology could be huge.
The costs of not switching to renewable energy far exceeds the cost of doing it.
In the U.S. with a tiny fraction of our power coming from wind and solar, we talk constantly about the "intermittency" of solar and wind.
Meanwhile Denmark already has 20% wind power. Parts of Denmark and Germany have 40% wind power.
Yes we need more storage solutions, better battery technology etc. What people don't get is that we can make a big start toward renewables with current technology.
I would argue that solar is already cheaper than fossil fuels when you consider the hidden costs of those. and wind is already cheaper without those considerations.
While there are several energy plans I've seen they all have the same elements. Solar, Wind, HVDC, plug in hybrids, biomass, geothermal, energy conservation and efficiency, etc.
I recommend reading the following articles.
www.setamericafree.org...
An Introductin to Core Climate Solutions
analyses and updates the solutions outlined in the Science magazine article on stablilization wedges below.
climateprogress.org/20.../
Science magazine article on Stablilization Wedges to solve global warminghttp://carbonse...
climateprogress.org/20.../
www.americanprogressac...
climateprogress.org/20.../
What makes it hard for renewable to compete with fossil fuels is the massive subsidies fossil fuels and nuclear receive.
See my comments on subsidies at yesterday's article on solar at Seeking Alpha
seekingalpha.com/artic...
Science magazine article on Stablilization Wedges to solve global warming
carbonsequestration.us...
The political system is encouraging power production of this type and the carbon credit markets will find footing in the near future. Projects are being developed worldwide and will likely gain additional favor in days/yrs to come. I am an advocate of the technology and can not see any real downside to it.
The West has a number of new and existing plants. Western Geopower Inc. is moving ahead with their project at the Geysers in Healdsburg (Napa County, CA) will be online with a new 35Mw plant in April 2010 and currently has over half its needed steam behind pipe. They have PG&E and NCPA contracts signed and is poised to meet or beat its April 2010 deadline for plugging in to the grid. Western (WGPWF)is a speculative play priced in the 12 cent range, which in a matter af a few short months aught to bring a minimum of a ten-fold return. You heard it here first.
potential to power the world x2
ceto.com.au
also desalinated water
epw.senate.gov/public/...
The issue of AGW is not settled.
If it's economic numbers that need crunched, solar, wind, geothermal, and hydroelectric plants are already profitably producing electricity. Perhaps the question we should be asking is how much will it cost us to continue paying for billions of dollars worth of oil, coal, and natural gas. Most alt energy infrastructure costs more to build upfront but then produces almost free energy once paid off, as opposed to paying for millions of dollars in coal/gas/oil every day to keep a coal/gas plant running.
In terms of national security, it's hard to say what that's worth, but it's billions at the least. Europe is building windmills as fast as they can to escape Russian control of natural gas and oil, as they should.
For baseload power, check out some of the advances in geothermal tech, particularly binary systems that can harness energy from low temp areas. Again, this is already being profitably done on a commercial scale. Waste methane, and hydroelectric are other storable base load options.
On Dec 10 08:53 AM Andy1234 wrote:
> I agree with the hand's comment above.
>
> I am also an engineer.....and people talk like alternative energy
> is the answer.......I think some of these economists and others need
> to sit down and start crunching numbers....figuring out how much
> energy can be provided using these technologies....what kind of baseload
> power is required....what kind of plants need to be running in case
> the wind or sun isn't shining or blowing......What are the costs
> to transfer to these power sources? Are there any material constraints
> if we massively switched to a certain storage source? etc etc etc.
>
>
> The scope of such a change is enormous......and we would be moving
> from an era of extracting energy that is already stored......to an
> era of harnessing/transmittin... and storing then transmitting and
> storing again.
>
On Dec 10 02:23 PM frflyer wrote:
> The hand
> You mentioned line loss over long distances.
> That's why all the sensible energy plans call for new high voltage
> DC transmission lines or HVDC to bring power from solar and wind
> farms to other parts of the country. There is much less line loss
> with HVDC over long distances. Anything over 30 miles favors DC
> in fact. Don't confuse this with the use of superconductors that
> john s. gordon mentions in his comment.
>
>
> Andy 1234 -you may be an engineer, but you are under-informed.
> The numbers have been crunched and these ideas are mostly well thought
> out. Solar thermal power plants with heat storage can act as base
> load power, as they produce a steady output of power even at night.
>
> What's more, they can store heat 20-100 times cheaper than storing
> electricity.
> They will be able to provide power at 5-8 cents a kWh once they are
> up to scale in several years.
> They are fast to build and use ordinary building materials. So low
> tech we could have done it 100 years ago. They can be air or water
> cooled, and can even desalinize water at the same time, when water
> cooled. Molten salt is the best medium for storing heat. United
> Technology's Sunstrand/Rockedyne division has developed advanced
> systems for molten salt use. They have also created a new solar
> thermal company called Solar Reserve. There are about 10 companies
> I've heard of in solar thermal.
>
> See the article in Scientific American that proposes building solar
> plants in the southwest, achieving 69% solar grid by 2050 and spending
> less in tax dollars over 35-40 years than we spent on the internet
> in the last 35 years.
> One fourth or less than we now give oil companies in subsidies and
> tax credits.
> www.sciam.com/article....
>
> For more on solar thermal:
>
> www.salon.com/news/fea...
>
>
> climateprogress.org/20.../
>
>
> solarsouthwest.org/
>
> Combining centralized solar in the southwest with distributed power
> from solar panels all over the country will give us solar on a vast
> scale. Photovoltaics are within a few years of grid parity, not
> including the external or hidden costs of fossil fuels.
>
> Wind is also much cheaper to build than coal or nuclear plants and
> about a third the cost of building nuclear. A recent govt report
> says we could have 20% wind power by 2030. Solar could be bigger.
>
>
> Geothermal with advanced technology could be huge.
>
> The costs of not switching to renewable energy far exceeds the cost
> of doing it.
>
> In the U.S. with a tiny fraction of our power coming from wind and
> solar, we talk constantly about the "intermittency&... of solar
> and wind.
> Meanwhile Denmark already has 20% wind power. Parts of Denmark and
> Germany have 40% wind power.
>
> Yes we need more storage solutions, better battery technology etc.
> What people don't get is that we can make a big start toward renewables
> with current technology.
>
> I would argue that solar is already cheaper than fossil fuels when
> you consider the hidden costs of those. and wind is already cheaper
> without those considerations.
>
> While there are several energy plans I've seen they all have the
> same elements. Solar, Wind, HVDC, plug in hybrids, biomass, geothermal,
> energy conservation and efficiency, etc.
>
> I recommend reading the following articles.
>
>
> www.setamericafree.org...
>
> An Introductin to Core Climate Solutions
> analyses and updates the solutions outlined in the Science magazine
> article on stablilization wedges below.
> climateprogress.org/20.../
>
>
> Science magazine article on Stablilization Wedges to solve global
> warminghttp://carbonse...
>
> climateprogress.org/20.../
>
>
> www.americanprogressac...
>
>
> climateprogress.org/20.../
>
>
>
> What makes it hard for renewable to compete with fossil fuels is
> the massive subsidies fossil fuels and nuclear receive.
>
> See my comments on subsidies at yesterday's article on solar at
> Seeking Alpha
> seekingalpha.com/artic...
Your numbers on how much wind is required to equal that from coal are way off. It takes less than three times as much wind to equal a constant supply like coal, not twenty times like you said.
So what? It's still cheaper, cleaner, and requires no fuel ever.
Clean coal will cost about 16cents /kWh when we have clean coal in 10 to 20 years.
Wind is about 1/4 the price and can be built now.
Lets clear up a misperception. No one is advocating tearing down all our coal or nuclear or gas plants without first replacing them with renewable energy. Coal will be phased out over time.
Our coal plants are old. Most are over 40 years old.
They just won't be replace with new coal plants.
Someday, clean coal may be a reality, but until you can remove the mercury and other pollutants as well as capturing and sequestering all the CO2 , it is not clean. We have lots of coal, so if in the future, we figure out how to use it wisely, it isn't going anywhere.
Same for new nuclear tech. Maybe it will be safe and will use thorium or whatever in the future, but right now it is not a good near term solution. We can flat out build solar and wind quicker, cheaper and with no worries about safety or pollution, or fuel.
John Peterson who writes articles here about storage solutions said that when we reach 15% renewable energy, storage will become an issue. We are a long way from that.
He said it had become an issue in Denmark, but Denmark has 20% wind power already.
Plus, wind and solar compliment each other to a certain extent because the wind generally blows more at night when PV is not generating.
You are completely misinformed about climate change. The scientific consensus is overwhelming. And getting stronger. The number of skeptic scientists is shrinking from a tiny number to an even tinier number.
www.logicalscience.com.../
I get my info from the websites of actual climate scientists, you should do the same.
Otherwise you fall into this kind of fantasy
"Scientific skepticism is a healthy thing. Scientists should always challenge themselves to expand their knowledge, improve their understanding and refine their theories. Yet this isn't what happens in global warming skepticism. Skeptics vigorously criticise any evidence that supports anthropogenic global warming (AGW) and yet eagerly, even blindly embrace any argument, op-ed piece, blog, study or 15 year old that refutes AGW"
www.skepticalscience.c...
"The global warming is a hoax believers don't understand the difference between informed opinion, uninformed opinion, misinformed opinion and totally ignorant opinions." from comments posted by LeeAnnG
gristmill.grist.org/st......
And here is who is fooling you
www.desmogblog.com/sla...
"But few PR offences have been so obvious, so successful and so despicable as the attack on the scientific certainty of climate change. Few have been so coldly calculating and few have been so well documented. For example, Ross Gelbspan, in his books, The Heat is On and Boiling Point sets out the whole case, pointing fingers and naming names. PR Watch founder John Stauber has done similarly exemplary work, tracking the bogus campaigns and linking various pseudo scientists to their energy industry funders."
"This is a triumph of disinformation. It is a living proof of the success of one of the boldest and most extensive PR campaigns in history, primarily financed by the energy industry and executed by some of the best PR talent in the world."
more links that tell the truth from actual climate scientists
environment.newscienti...
scholarsandrogues.word.../
gristmill.grist.org/sk...
scienceblogs.com/illco...
www.realclimate.org/
Climate Change from Climate Scientists
Is it you who is trying to fool me?
I am a hydrogeologist, not a climate expert. Expert climate scientists are not of a single opinion regarding AGW. Maybe you're right, maybe not. I have read many of the experts' books and reports, including the most recent IPCC report. I like to think that I am even-handed in assessing scientific hypotheses, and the related logic (or fallacies of logic). CO2 increases plant fecundity, but it is not a fact that it is causing global warming. Scientific debate is healthy. Do you think all of the opinions in the following link (so-called Senate Minority Report on AGW) are exclusively those of crackpots?:
epw.senate.gov/public/...
I find many of those comments rational and valid. The issue of AGW is not settled.