Lost On The Shore

'Fiscal Responsibilty'

As I write this the price of crude oil is somewhere near $145 a barrel - a sum that would be unimaginable a couple of years ago.  As I wrote earlier, it is a classic supply and demand situation - the demand continues to rise, driven by sustained and robust economic growth in China, India and the former soviet union.  Supply, on the other hand, has remained relatively stagnant for the past several years. 

But the price of oil hasn't risen by the same percentage everywhere.  In Europe, the price has still risen substantially over the past several years, but not nearly as much as it has here.  Why is that?  Well, the Europeans (many of them anyway) pay for their oil in Euros, and the value of Euro has been much stronger than the dollar.  In 2004, you could buy a Euro for about $1.10, in 2006 it cost about $1.25, today it costs about $1.57 to buy a Euro.

Oil traders, financial analysts and producers all agree that one of the factors driving up the price of oil for us has been the weakness of the dollar.  If we could strengthen the dollar, it would do much to restrain the price of oil (and other commodities).  And one good way to strengthen the dollar would be to balance the federal budget. 

Now Andy Harris, like most Republican politicians since Reagan runs on a simple mantra of 'lower taxes'.  He also talks about something called fiscal discipline.  Every Republican says they want lower taxes.  They know we all want to pay less and it's an easy thing to say.  And if Harris is elected, you can bet he will vote to lower taxes.  But whose taxes will he lower?  It's safe to say it won't be mine and probably not yours.  He'll push to lower taxes for himself and his rich cronies from the Club for Growth or as conservative Mike Huckabee called it - the 'Club for Greed'.

Let's go back and look at the tax cuts that George W. Bush pushed through a compliant Republican Congress when he became President.  Over the ten-year period of his tax cuts, from 2001 to 2010, an astonishing 52 percent of the total cuts will go to the richest 1 percent of taxpayers! 

Now let's look at the flip side - the 'fiscal discipline' side.  Since George W. Bush became President, with a compliant Republican-controlled Congress, Federal spending has grown at an average of 5 percent per year - faster than the growth of the economy and much faster than the 2 percent growth during the Clinton years.  During this period we've added about $3 Trillion to the national debt, which will be a burden to our children and our country for years and years to come.  So much for Republican fiscal conservatism.

So we know what to expect if Harris is elected - more tax cuts for the rich, more bloated Federal spending and a further decline in the value of the dollar leading to higher and higher commodity prices.  Hold on to your wallet.

[The photo shows the supertanker 'Abqaiq', owned by Saudi Arabia, taking on oil at Iraq's Basrah off-shore oil terminal]

A Wiser Choice

Energy prices are high.  For all intents and purposes, they are going to stay high - maybe get higher.  While the price of oil might fall back to a previously unimaginable $100 per barrel, the long term trend is going to be for it to increase.  Why?  Because demand is increasing much faster than supply is able to increase.  And, as I pointed out in an earlier post, even the Bush administration doesn't think that opening up ANWR and the offshore continental shelf will do much, if anything to reduce prices.

So, with the reality that gasoline is going to stay expensive, what should the state of Maryland do for its citizens?  The citizens of Maryland have already voted on that; ridership on MARC and on the Washington Metro is setting new records regularly.  Ridership on Amtrak is up sharply and, in fact, may trains are sold out well into the future.  Ridership on local and regional bus systems has increased sharply.  Maryland needs to invest more in mass transit.

And we need to begin now.  Like anything else, mass transit takes time to build.  While the state is spending more than a billion dollars building the Inter-County Connector, passengers are flocking to MARC and Metro trains and to the Baltimore light rail, and the overcrowding is just going to get worse.  Now is the time to begin expanding the infrastructure, building the new stations and parking for the new residents that will be coming with BRAC and ordering the new cars that are already needed.  The state needs to invest in expanding and modernizing its long-distance commuter bus network and beefing up the weak public transportation networks in its rural areas.

And we can do more than that.  The photo above shows the Eurostar and Thalys trains side-by-side at the Gare du Nord in Paris.  While we've been fiddling around in this country with slow and inefficient long-distance rail passenger service, the Europeans have built an efficient network of high-speed passenger rail trains, among them the Eurostar, which runs between London and Paris and between London and Brussels and the Thalys which links Paris, Amsterdam, Brussels, Antwerp and Cologne. 

These trains run on dedicated rail lines at top speeds of 186 mph.  Travel time, for example, on the 190 mile route between Paris and Brussels is one hour and 22 minutes.  At those speeds, the travel time by train between Washington and New York could be one hour and 40 minutes or less.  We just need to spend the money (which would be a lot) to upgrade the track.

So Maryland should partner with the other Northeastern states to upgrade rail passenger service in the Northeast corridor.  The congress will never appropriate the kind of money that Amtrak nees to upgrade its service nationwide and that wouldn't make any sense anyway - rail travel - even high speed rail travel - will never compete with air travel in the wide open spaces of the great plains and the west.

But here in the more densely-packed northeast, high-speed rail travel can and should be the first option for intercity travel.  It's something we can and should do to help reduce our transportation costs and energy use.  In the meantime, we need to get to work here in Maryland building a mass transit system that will get us off the roads and help us use less gas. 

Oil Follies

Certainly one of the issues on everyone's mind these days is the price of gasoline and the price of oil.  The runup in the price of both over the past couple of years has everyone wringing their hands and looking for solutions.  Every politician from the local dogcatcher to the President of the United States (and more importantly, the King of Saudi Arabia) has either come up with a plan to address the 'oil crisis' or is working on one. 

Andy Harris, the Republican nominee for Congress in Maryland's First District recently released his plan.  As I understand it, the plan includes:

1. Temporarily suspending the Federal and state gasoline taxes from Memorial Day to Labor Day.
2. Temporarily reducing the 40+ gasoline blends used in the United States to four blends in an effort to simplify refining and improve the efficiency of refining and transporting gasoline.
3. Opening the Arctic National Wildlife Preserve, the Aleutian Islands and the US continental shelf to oil and gas production.
4. Increase long-term oil refining capacity by establishing fast track approval for new and expanded refineries.
5. Provide incentives for technological innovations in alternative forms of energy such as nuclear, solar, geothermal, and cellusolic ethanol.

Before analyzing the plan, let's take a look at the background of the problem. 

World Petroleum Production and Consumption (Millions of BBL/day)

	2003	2004	2005	2006	2007
Production	79.6	83.1	84.6	84.6	84.6
Consumption	79.6	82.3	83.7	84.6	85.4

These figures are from the US Energy Information Administration.  Note that production has stagnated since 2005 while world consumption has continued to grow.  Consumption by industrialized countries (OECD members) in 2007 was basically the same as it was in 2003 - a little under 49 million barrels a day.  Consumption in other countries, however, increased from about 31 million barrels a day in 2003 to 36.4 million barrels a day in 2007.  Every indication is that the demand from non-OECD members will continue to increase.  Demand in China, with its 2 billion citizens and India with its billion or so will continue to grow at a rapid rate.  Demand in the former USSR is also growing. 

Production, on the other hand, isn't increasing at all.  While new fields are coming on line, in the Caspian Sea area for example, and new discoveries are being made, they are insufficient to overcome the long-term decline of three to four percent in the production of existing fields.

Many blame speculators for increasing the price of oil by driving up demand and, in fact, they do contribute to some of the wild fluctuations and instability in the market, but they never actually take delivery of the oil and thus don't contribute to the ultimate demand.  So what we really have is a growing imbalance between a static supply and a growing demand that is driving prices higher.

With that in mind, let's take a look at Andy Harris's proposed energy plan.

First he proposes eliminating the gasoline tax - both Federal and state - between Memorial Day and Labor day.  This will have the effect of increasing demand but will do nothing to boost supplies.  In addition, of course, hundreds of millionss of dollars that should be used to ease traffic bottlenecks, maintain roads and expand mass transit will be lost.  Sure the price might drop a bit initially, but will creep back up as demand returns and we'll have nothing to show for it.  I've written about it before, but I have to say it again - this is a bad idea.

Second, he wants to reduce the 40 or so different gasoline blends in the United States to 4 - he doesn't say how.  The reason these different blends exist is to mitigate air quality problems in many large metropolitan areas around the United States.  They are designed to reduce emissions of volatile organic compounds which, combined with sunlight, produce ozone.  Some also are formulated to reduce emission of nitrogen oxides which pollute air and waterways and can contribute to acid rain.  Certainly a reduction in the number of blends will reduce transportation and storage costs for the oil companies.  The effect on consumer costs is uncertain.  Many of the blends cost more to produce than conventional gasoline but pollute less.  It's hard for me to see how this will save money for consumers without increasing ozone pollution in our metropolitan areas.  I don't see any additional production or reduced demand from this.

Third, he wants to open the Arctic National Wildlife Reserve (ANWR), the Aleutian Islands and the US Continental shelf to exploration.  The US Geological Survey estimates that there are between 7 and 8 billion barrels of recoverable oil in ANWR.  The Energy Information Administration estimates that opening ANWR to production would result in a peak production of 780,000 barrels per day in 2027 which would reduce the price of a barrel of oil by about 75 cents - not quite two cents per gallon. 

I have no idea how much recoverable oil is in the Aleutian Island area - I haven't been able to find much about it.  It appears certain there are significant amounts of recoverable crude oil in the unexplored parts of the US continental shelf - perhaps more than exist in ANWR.  Americans need to decide what kinds of risks they want to take to obtain additional domestic oil supplies - even if they are small compared to our imports.  It's worth noting, though, that we seem unwilling to allow even wind turbines to be built offshore, much less oil platforms, pipelines, etc. that would come with significant oil production.  This proposal does add something to production, albeit not for ten or fifteen years at the earliest.  

Fourth, he wants to increase long-term refining capacity in the United States, presumably by eliminating some of the environmental and safety reviews that are now required.  Refining is an interesting problem.  Over the past year, the price of oil has increased much faster than the price of gasoline, sharply reducing the profits levels of refineries.  Oil companies like Valero and Sunoco which refine oil but don't produce it have dropped sharply over the past year.  As a result refiners are shifting their operations to produce more distillate (diesel and heating oil) which has a relatively high price and less gasoline from each barrel.  

Harris's proposal ignores the real problem with refining - it's not consistently profitable.  If companies can't earn a reliable and fair return on investment in new refinery capacity, none will be built, regardless of any loosening of regulations.  I don't see anything here which will alter the supply/demand relationship.

Fifth, he wants to provide incentives for technological innovations in alternate forms of energy.  I'm all for this, provided the incentives don't turn into long-term subsidies.  We need to find alternatives and, in the long run, this will help to reduce demand for petroleum and all that comes with it.

So what does all this do for Marylanders and the voters of the First District?  Not much in the short term except for the ridiculous and self-defeating gas tax holiday.  But maybe there's not much that can be done in the short term.  I do note that Harris's proposals contain nothing about mass transit or public transportation, nothing about smart growth that would reduce transportation needs, nothing about increasing corporate fleet mileage requirements and nothing about alternative fuels such as the plug-in hybrids being developed by General Motors and Toyota and the hydrogen fuel cell car recently introduced by Honda, but that may be too much to ask.

[The photo (click on it to see the large version0 is of the Thunderhorse production platform built by BP at a cost of about $1 billion.  It was struck by hurricane Dennis in 2005 before it was in production and partially capsized due to a construction error.  It's a reminder that there are risks to offshore drilling and production that need to be balanced against the potential rewards]  

 

Some Nuclear Issues

'TJH' has added an excellent comment to my recent post on nuclear energy options and raised some issues which I think need to be explored a bit more.  Basically, he makes three points:

• The nuclear waste disposal problem is not being solved,
• the cost of new nuclear generation is not competitive with coal without massive government subsidies, and
• the comparison of deaths due to nuclear energy to deaths due to coal is not a valid measure of nuclear safety.

He also asserts that carbon sequestration is likely to be available before the solution to nuclear waste disposal problem.  Let's look at each of these.

Nuclear Waste It's true the nuclear waste disposal problem has not been solved - at least in the United States.  The problem seems to be as much a political problem as an engineering problem.  Currently the standard which the engineers are supposed to meet would limit radiation exposure to 350 millirem for ONE MILLION YEARS taking into account the effects of climate change, earthquakes, volcanos, asteroids falling from the sky and other, unknowable, factors.  It's worth noting in this context that the entire recorded history of the human race is about four thousand years.  If such a standard were applied to other kinds of industrial waste, including carbon dioxide, most modern industry would shut down immediately.

Other countries seem to have solved the problem.  Canada has developed a system for burying nuclear wastes in batholiths some 500 to 1000 meters beneath the surface within the Canadian Shield - one of the most geologically stable formations on Earth.  The batholiths were formed some one to two billion years ago and have been stable since then.  Sweden has developed a method called KBS-3 which, after some interim storage during which the radioactivity is sharply reduced, buries the waste in bentonite clay some 500 meters beneath the surface.  The Finnish government has begun building a similar site.  France, Japan, the United Kingdom, and Russia reprocess spent fuel.

Cost What will be the cost of electricity from a new generation of nuclear plants?  No one can say for certain.  The primary difficulty in estimating the cost is that a large part of the eventual costs are the up-front capital costs of the plant, and that depends largely on how long it takes the plant to be built.  The nuclear power industry does not have a good record in this regard.  They argue, however, that with standardized designs which are pre-approved, the time required to build new nuclear plants will be shorter and more predictable. 

The evidence is mixed.  A plant being built in Finland is significantly behind schedule and over budget.  Several others under construction in Japan, however, are both on time and under budget.  A study completed by MIT in 2003 found that nuclear power would be about 60 percent more costly than coal or natural gas power.  Another, by the Royal Acadamy of Engineering in 2005 put the cost of new nuclear energy at 2.26 pence per kilowatt-hour vs. 3.64 for natural gas power and 3.33 for coal.  This report has been disputed by many, though who argue it doesn't account for government subsidies to the nuclear industry and understimates disposal costs.  Nuclear power does receive some subsidy from the government.  Of course, coal, natural gas and renewables all receive signifianct government subsidies.

I believe that with experience, problems with the construction of nuclear plants will be resolved and the construction period will become shorter and more predictable leading to a cost per kilowatt that is competitive with coal.  Of course I have no data to back that up, but neither do those who say the cost will be much higher.  We won't know until we build a few plants.

Safety Of course, the number of deaths is only a rough indicator of the relative safety of nuclear power vs. coal.  And certainly, as TJH points out, the accident at Chernobyl devastated a significant amount of land.  But coal mining devastates a significant amount of land every year.  And coal is not only unsafe to mine, it's unsafe to burn.  Coal-fired power plants spew out an amazing amount of pollutants - 59% of total US sulfur dioxide pollution, 18% of total nitrogen oxides, 50% of total particulate pollution and 40% of total US carbon dioxide emissions.  These pollutants contribute to smog that threatens the health of tens of millions. According to the Sierra Club, particle pollution from power plants alone causes some 30,000 deaths a year in the US.  Coal-fired power plants are the largest single man-made source of mercury pollution.

There's lots else I could say about coal.  Sure, nuclear power has safety issues but they pale in comparison to what we're doing now.  We need to stop building new coal plants and get rid of the ones we have.  The only feasible alternative at the moment is nuclear.  Effective carbon sequestration from coal plants is making little progress- the Department of Energy recently pulled the plug on the FUTUREGEN demonstration project saying it did not make fiscal sense.

Sure, nuclear power is dangerous.  The eventual costs are only rough estimates and the waste disposal problem has not been resolved.  But where are the alternatives to generating the reliable quantities of electricity we need to allow us to retire the coal plants that are killing us.

[The photo is of the Bruce Nuclear Plant in Canada - the second largest in the world]

Items of Interest

It's been a soggy couple of days on the Shore and we're looking at a few more before we finally break into our late spring and summer weather.  While I'm waiting I want to catch up on a few items of interest that caught my eye over the past week.

Energy prices continue to rise. Gasoline prices set a new record in Maryland this week.  Gasoline prices nationwide reached an average of $3.67 a gallon and oil reached $126 a barrel.  Gas prices here on the Shore ranged from about $3.55 to $3.65 while in the high priced areas of Montgomery County prices were in the $3.75 - $3.85 range with one station posting $3.97 and a station in DC was asking $4.05 for regular.  Diesel prices are higher everywhere. 

The tourism industry here on the Shore relies heavily on vacationers driving over the Bay Bridge from the DC/Baltimore area and down from the Philadelphia area.  With the peak summer driving season starting in a few weeks, the ability of consumers to absorb these increases could have a dramatic impact on the economy here.

On the electricity side, BG&E posted their new rates and PEPCO Holdings announced that their first-quarter profits doubled from last year.  It looks like a difficult summer on the electricity front, also.

Transportation  In a related development, the New York Times today reported that higher gas prices are driving record crowds to mass transit.  Mass transit systems are struggling to cope and equipment shortages are becoming apparent as is apparent both in Baltimore and Washington.  With a huge proportion of the state's transportation budget tied up in the InterCounty Connector, the state and local jurisdictions are going to have to look hard at their budgets to see where they can free up some funds to expand mass transit options.

Here on the Shore, there's little mass transit to speak of.  In Ocean City, though, the town is encouraging visitors to rely on its bus system while visiting there.  A crowded summer weekend can easily overtax the system there and they are going to have to be careful to ensure they have enough capacity.

On a brighter note, the state has announced that construction will begin next year on the MARC station in Edgewood.  With thousands of new jobs coming to the Aberdeen Proving Grounds, this station will be a critical part of the transportation infrastructure there. 

Health  A recent study in New England shows that teenagers in places with strict smoking bans in restaurants were forty percent less likely to become regular smokers.  Apparently, huddling outside restaurants and bars to take a puff isn't 'cool'.  Lower smoking rates among teens will help keep health care costs from growing so fast.  Every little bit helps.

Real Estate The number of home sales continues to decline in Maryland.  The National Association of Realtors, as they have every recent month, said that the turnaround is about to start, but almost no one else seems to think so.  Spring is normally the peak selling season, but it doesn't seem to be happening, at least here on the Shore.

In many states, local jurisdictions are facing severe budgetary problems as falling assessments lead to reductions in property taxes.  Here in Maryland, the problem is not quite so urgent as our three-year assessment system means that assessed values are still rising in most jurisdictions.  Some counties, though, like Montgomery and Prince George's, which have come to rely heavily on transfer taxes, are suffering as home sales decline sharply.  All local jurisdictions need to be very careful in committing to future costs, though, as the same three-year assessment cycle which is helping them now will be hurting them in the future as new assessments drop.

[The photo is of Thomas Point Shoal Light] 

Maryland Energy Update

There have been a couple of recent development relating to energy supplies and prices in Maryland.

Jay Hancock blogs in the Baltimore Sun that SEMPRA Energy has pulled the plug on its proposed new power plant in Frederick County.  The natural gas-fired plant would have provided badly-needed capacity to Central Maryland and may have enabled the EastAlco plant to reopen.  The EastAlco aluminum smelter, now owned by Alcoa, was forced to shut down a couple of years ago when their long-term contract with Allegheny Power expired and they couldn't afford the high cost of electricity off the grid in Maryland.  SEMPRA apparently gave up because the pricing structure wasn't right.  Hancock seems to think there's a possibility the plant can be revived if a long-term contract with BG&E materializes.  I'm wondering if it may just be posturing by SEMPRA to get an exemption from emission caps like that suggested for the plant in Charles County. 

With this in mind, let's look at the other big basic metal production plant in Maryland - Sparrows Point.  Yesterday OAO Severstal completed its acquisition of the plant.  Severstal has said it wants to increase production at the plant and make significant investments in expanding and modernizing the plant.  Of course, a lot depends on energy costs - steelmaking is an energy-intensive business.  More directly, the manufacture of iron from iron ore releases lots of carbon dioxide into the atmosphere.  If Maryland's new cap and trade system increases the cost of iron-making, it may not be economical to continue basic smelting there.

Tom Pelton at the Sun's Bay and Environment blog has put up this post on greenhouse gas trading scams.  He writes about a letter that two EPA scientists have sent to Congress pointing out how cap and trade schemes are vulnerable to abuse and are difficult to enforce and verify.  Of course, Maryland is well on the way to implementing its own cap and trade scheme.  There's already talk of exempting favored companies - exactly what we don't need at this point.  As I've said before, a carbon tax fee would be a much more effective and transparent solution, but we seem to be committed to this other system.  We'll have to keep a close eye on implementation plan which still seems to be evolving.

There are some predictions that it will be a hotter than normal summer in the mid-Atlantic region.  It's going to be an expensive summer for energy.

[note: the photo shows tipple boys and drivers at a Maryland Coal Company mine in 1908] 

And The Hits Just Keep On Coming

Pilgrim's Pride is the latest chicken producer to report a loss.  The report by this company, the largest chicken producer in the country, follows the loss reported by Tyson Foods, the world's largest meat producer, of a loss for the third quarter.  Purdue Farms, the largest poultry producer on the Shore, is privately held and doesn't report profit and loss, but I would be surprised if they were not struggling also.

The primary culprit in each case is high grain prices with some contribution from high energy prices and transportation costs.  The companies have been unanimous in blaming flawed government ethanol policies for contributing to the higher cost of grain.  To a significant extent, they are right.  The huge subsidies for ethanol production has led to an explosion in the number of ethanol plants that now suck up about a quarter of our total corn production.  Further, the demand for corn has led many farmers to shift production out of wheat and other grains into corn.

This demand, coupled with crop failures overseas and increased demand from rapidly developing countries like India and China has sent grain prices up substantially and has affected the price of many other foodstuffs.  But anyone who shops for food already knows that. 

On top of all this, of course, the congress is prepared to pass a wasteful and grossly inflated farm bill which will increase subsidies to farmers and significantly increase consumer prices for many things.  But I digress.

It seems that a cutback in poultry production may be coming and that will be just another hit for the Eastern Shore, where the economy is already hurting due to the sharp decline in residential housing construction.  With the cost of gasoline more than $3.50 a gallon, it's likely we will see a reduction in tourism too.  We already know the crabbing industry is taking a hit. 

So it could be a difficult year here on the Shore.  We'll have to see what comes next.

Those Pesky Nukes

This is the second part of my two-part post examining energy options for reducing Maryland's greenhouse gas emissions.  In my previous post we looked at a variety of energy alternatives available to replace the large, base-load coal plants that generate so much greenhouse gas (and other pollution) in Maryland.  We looked at 'clean coal' natural gas and fuel oil generation.  In addition, we looked at renewable technologies such as wind, photovoltaic, solar thermal, hydro and biomass.  Today we're going to look at nuclear energy.

The map above shows the location of nuclear generating facilities in France, which generates about 80 percent of its electricity at nuclear facilities.  France is also the world's largest exporter of electricity, due, in part, to it's relatively low cost.  Japan is another country with a large nuclear generating capacity with some 55 units generating around 30 percent of Japan's electricity.  Five new plants are under construction in Japan.  Nuclear power accounts for about 19 percent of the electricity generation in the United States.  In Maryland, the Calvert Cliffs nuclear plant in Lusby accounts for about 14 percent of the state's generating capacity (but a higher percentage of the total electricity generated because it operates for a higher percentage of the time.)

Like every other source of power, nuclear energy has its problems and concerns.  Let's take a look at them.

Many people believe nuclear energy is inherently dangerous, that is an accurate assessment.  There are a number of things that can go wrong and lead to release of radiation or much worse. Since commercial generation of nuclear power began in the 1950's there have been twenty or so significant accidents.  Three of those are well known.

1. In March of 1979 near Middletown, Pennsylvania, equipment failures and worker mistakes contributed to a loss of coolant accident (LOCA) and partial core meltdown at the Three Mile Island nuclear power plant.  The reactor was extensively damaged, but on-site radiation exposure was under 100 millirems (about one year's natural exposure) and some two million people in the vicinity received about 1 millrem.  There were no reported fatalities although statistical estimates indicate that there may be one fatality due to the excess radiation.
2. In April of 1986 near Pripiat, Ukraine, worker error led to an uncontrolled power excursion, a steam explosion, partial core meltdown and release of radioactive material at the Chernobyl nuclear power plant.  There were approximately 50 fatalities during and immediately after the disaster.  The explosion and subsequent burning of the graphite core reactor spread radioactive material over much of Europe.  Hundreds of thousands were evacuated from the immediate vicinity and downwind.  While estimates vary widely, the UN has estimated that some 4,000 additional premature deaths will result from radiation exposure.
3. In September of 1999 at Ibaraki prefecture in Japan, workers at a reprocessing facility accidentally added enough uranium solution to a precipitation tank to achieve a critical mass.  The resulting radiation killed two workers and exposed more than 100 others to higher than normal radiation.

These are the only civilian nuclear power accidents I've been able to find which led to fatalities.  Let's contrast this briefly with the safety of coal power.  Since the 1950's when commercial nuclear generation of electricity began, there have been several thousand fatalities in coal mines.  In addition, around twenty thousand miners are injured each year.  Further, tens of thousands have been crippled and or had their lives markedly shortened by black lung disease.  Worldwide, the number of deaths and injuries is staggering.  In China alone, more than 4,000 were killed in 2006.  Thousands more fatalities can reliably be attributed to the environmental effects of buring coal to produce electricity.

Critics of nuclear power point rightly to the fact that our country has been unable to come up with a method for the long term disposal of high level nuclear wastes.  High level nuclear wastes amount to 5 percent or less of the total radioactive wastes produced by commercial nuclear reactors.  Low level and mid level nuclear wastes have been disposed of safely without a problem.  High level nuclear wastes are the products of the fission of uranium which include radioisotopes which can emit ionizing radiation.  Some of the fission products can remain dangerously radioactive for thousands or millions of years.

In the United States geologic disposal is the disposal method which has gained the most favor.  This involves sealing the wastes into very strong casks and burying it deep underground.  The Department of Energy has been developing a waste disposal site at Yucca Mountain in Nevada.  It is not operational yet, however due to a variety of engineering and political issues. 

Geological disposal, however, is not the only option for disposal.  It is worth noting that other countries have made much more progress on the issue.  Sweden and Finland, for example are well advanced with geologic disposal and Canada is seriously considering a similar options.  Other countries such as France, UK, Japan, Russia and, recently, India, have nuclear fuel reprocessing plants which reprocess the spent fuel into new nuclear fuel.  Another option, which has not been used involves mixing the nuclear waste with tailings from uranium mines down to the level of radioactivity of the original uranium and then reburying it in the mines.

Disposal of waste from nuclear power plants is a problem that is being solved.  Disposal of waste from coal power plants, on the other hand, remains problematic.  The biggest waste product - carbon dioxide - is accumulating in our atmosphere and has the potential to create a global disaster in time on a scale unprecendented.

So, yes.  Nuclear power has its problems, but, to me at least, it looks like the least bad of all the options for electric power generation.  Governor O'Malley seems to have recognized this with his recent support for the additional plant that Constellation Energy proposes for Lusby.  The 4,000 megawatts of power that will be generated by this plant could replace all the electricity generated by the Chalk Point and Brandon Shores coal plants.  Together these two plants emit more than 14 million tons of carbon dioxide a year.  Another nuclear plant, perhaps located in Central Maryland, would allow the closure of all coal-fired plants in Maryland.

Nuclear power is already competitive with coal power on a cost basis.  With a modest carbon tax, nuclear power could easily displace the dirty coal plants that are polluting our air and water.  There would be no cost to Maryland consumers since all the proceeds from the carbon tax could be distributed to Maryland consumers on a regular basis.  Clean air, clean water, no cost...what more could we want? 

The right path for Maryland to reduce greenhouse gases

I've been taken to task for not being sufficiently supportive of the state's greenhouse gas reduction program and expressing only lukewarm enthusiasm for the 640 mw gas-fired power plant proposed for Charles County.  I guess I should explain.

The state is so excited they have talked about giving the new plant an exemption from the cap-and-trade system that will provide tradable permits for carbon dioxide emissions in Maryland.  Environment Maryland has praised the new plant as being 'less polluting' than coal plants.  So how much will the new plant reduce greenhouse gas emissions in Maryland?  The short answer is - none.

The reason it will have no effect is that it will not displace any existing plant.  The half dozen or so large coal plants that pump out the majority of greenhouse gases in Maryland will continue to operate full throttle because they have a substantial economic advantage in terms of fuel costs and the demand for electricity substantially exceeds the supply.  Certainly, when the emission cap goes into place, their costs will increase a bit, but they will pass all of that cost onto the consumer without any problem because they are relatively low cost (and highly profitable) producers.

No, if we are serious about reducing greenhouse gas emissions in Maryland - and we should be, we need to first have an alternate means of generating the electricity now produced by the big coal plants.  That means base load plants that can run efficiently 24 hours a day to provide stable, reliable energy to Marylanders.  And they have to operate at a cost competitive with current electricity providers.  Most Marylanders have already experienced sharp increases in the cost of electricity over the past two years.

Now some might say that we don't need to build new plants, we can just force our own coal plants to close and bring in electricity from somewhere else instead of generating it in Maryland.  But we already know that there is insufficient transmission capacity to substantially increase the amount of electricity bought into Maryland from other states.  And besides, generating the electricity in Pennsylvania or West Virginia really does nothing to reduce greenhouse gases, does it? 

So let's look at the options.  There are a variety of fossil fuel types of plants - coal, fuel oil and natural gas.  On the renewable energy side there are wind, photovoltaic, solar thermal, wave energy, hydro and biomass.  And finally, there's nuclear.  Let's take a look at each.

Big coal companies and politicians fro coal-producing states promote something called 'clean coal'.  It doesn't exist.  The technologies necessary to mine, transport and burn coal for energy without producing harmful pollution or greenhouse gases either don't exist or exist only in the laboratory.  The Federal Government, after spending billions of dollars on clean coal technology has essentially given up - terminating all projects.

Several power plants in Maryland use oil as a fuel.  Oil is unsuitable for base load plants, however, due to its cost.  These plants are mostly used to provide electricity during periods of peak demand.  Further, these plants produce significant amounts of greenhouse gases (less than coal, though) and can generate other pollutants.

Natural gas has become a more popular fuel for electricity generation due to it's relative cleanliness (compared to coal and fuel oil) and it's ease of supply.  A large gas transmission line runs through Maryland and the LNG terminal at Cove Point feeds additional supplies into the region.  Advanced combined-cycle gas turbine installations can reach efficiency levels in excess of 60 percent (i.e. 60 percent of the energy in the fuel is converted into useful output).  Natural gas, when used to generate electricity, creates only about half the carbon dioxide per kilowatt compared to coal.  The prinicple problem with natural gas is cost - it costs about five times as much as coal per unit of energy (and about half what fuel oil costs).  Natural gas prices have been increasing steadily over the past several years, too. 

Renewable energy is very popular and for good reason.  It doesn't rely on a diminishing source of fuel and it's generally pretty safe.  There are limits to each of the technologies, though.

Wind power is one of the more cost effective of the renewable technologies.  Substantial improvements have been made in the technology in recent years and it can, in some cases, be quite competitive on a cost basis.  The big problem with wind power is, of course, the wind which is notoriously variable.  The amount of energy available in wind varies with the cube of the velocity.  Studies at the Lee Ranch wind power facility in Colorado have shown that half of all the available energy arrived in just 15% of the time.  Thus, for wind energy to be suitable for base load generation, substantial backup generating plants would have to be built.  A further problem is that in Maryland, the strongest sustained winds are in the winter while our highest electricity demand is in the summer.

Much has been said and written about photovoltaic energy.  The fact is, though, that it is still very costly as a source of base load electricity.  Until the technology improves substantially, this isn't an option.

Solar thermal - a technology where sunlight is used to heat a fluid which is then used to drive a turbine or energy to generate electricity.  This is an interesting technology which can be quite competitive where conditions are favorable - generally in low latitude deserts - not in Maryland.

Biomass, which includes the use of landfill methane, can efficiently generate electricity and can make a contribution to Maryland's electricity supply.  Unfortunately I don't believe there's suffient biomass available in Maryland to make a big dent in our electricity needs.

There's not a lot of available hydropower in Maryland that hasn't already been tapped, although there could be some small-scale hydro installations at some water reservoirs with little cost.  The additional amount of electricity would be small.  Ocean waves contain considerable energy, but the technology to harness that energy hasn't been perfected.

That leaves nuclear.  In my next post, I'll discuss the pros and cons of that.

    

Gas Tax Fantasy

State Senator Andy Harris, concerned about rising gas prices, has suggested that Governor O'Malley call a special session of the General Assembly for the sole purpose of repealing the state gas tax from Memorial Day to Labor Day.

While his proposal has obvious political appeal, particularly to those short-sighted enough not to be able to see past Labor Day, there are a number of problems with the idea.

• The gasoline tax is the primary source of transportation funding in the state.  Reducing the gasoline tax will necessarily reduce the funding available for transportation improvements.  Roads in Maryland, particularly in the Baltimore/Washington area, are already heavily congested, which means a lot of gasoline is wasted waiting in traffic jams.  We need to reduce congestion, not increase it.
• Reducing the price of gasoline to the consumer will increase demand which will eventually increase the price not only of gasoline, but also of the oil from which it is derived.  Reducing or suspending the tax therefore puts more money into the hands of the oil-producing countries rather than keeping it here where it can be invested in improvements to our infrastructure.
• Suspending the tax merely postpones the inevitable.  Saving a few cents on a tank of gas does nothing to address the urgent need to find alternative sources of energy and use our existing sources more efficiently.

Andy Harris has proved he's as clueless about the economy as John McCain, who made a similar proposal on a national level which was panned by the a wide variety of economists and energy analysts for the same reasons I outline above. 

And why did Andy Harris wait until just a few days after the regular session ended to make this proposal?  Is it possible that this is just cheap political pandering?  Looks that way to me.