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Sunday, December 30, 2012
Editor’s Choice: Five Important U.S. Energy Stories Of 2012
The presidential and congressional elections dominated the American news cycle in 2012. And although climate change took a backseat during the campaign, energy played a surprisingly prominent role.
The news cycle was dominated by energy: Republican presidential candidate Mitt Romney made fossil fuel extraction his number one priority; fossil fuel interests spent hundreds of millions of dollars to promote oil, coal, and gas during the election; and President Obama busily defended his promotion of renewable energy after getting attacked by the fossil fuel lobby.
Looking back at 2012, here are some of the most important energy stories of the year:
AP Fact Check: In 36 Years Of Data, Not A Shred Of Evidence That Drilling Reduces Gas Prices
In March, the Associated Press analyzed more than 30 years of gas price and domestic drilling data. It found absolutely no correlation between increased domestic drilling and lower prices for consumers. Why? Because oil is a global market and U.S. production represents a small portion of global demand.
This was a particularly important story in 2012. Throughout the election season, the fossil fuel lobby and proponents of “drill-baby-drill” pushed a plan for unchecked fossil fuel development, falsely claiming it would lower gas prices. Experience proved otherwise. Even though the U.S. is producing more oil than at any point since the mid 1990's, gas prices have remained “stubbornly high.”
Big Polluters Spend $270 Million In Final Months Of 2012 Elections
Fossil fuel interests spent unprecedented amounts of money this election season. In the last two months of the campaign, groups promoting fossil fuels spent $270 million on television ads to influence the presidential, House, and Senate races. From April to November, these groups spent $265.9 million on the presidential campaign alone, according to a Center for American Progress Action Fund analysis.
But the lavish spending didn’t work. Despite spending record amounts of money, polluter groups failed to change the presidency, failed to change the balance of power in Congress, and failed to give Republicans the important coal states of Ohio, Pennsylvania, and Virginia.
Environmental Groups Celebrate A Political Victory: ‘Knock, Baby, Knock’ Beat ‘Drill, Baby, Drill’
Judging by pure spending, the 2012 election wasn’t looking good for environmentalists. Polluter groups outspent environmental groups 4-1, making it seem like the momentum was on their side. But the results showed otherwise: Four out of the “flat earth five” climate deniers in the House lost their races; Seven of eight Senate candidates supported by environmental groups won their races, thus preventing Republicans from taking the Senate and cutting off the drumbeat of anti-environmental legislation in the House; 11 of the 12 “Climate Heroes” promoted by environmentalists won their races; and the President kept his job.
While gridlock will likely define Obama’s second term, environmental advocates said the 2012 elections proved their strength: “We went head to head with the likes of Crossroads and Karl Rove,” said Jamie Rappaport Clark, president of Defenders of Wildlife, after the elections.
Shell’s Woes In The Arctic Underscore Challenges In The Region
The Arctic is shedding ice at an alarming rate due to global warming. The response? Oil companies want to use the opportunity to look for more offshore oil and gas that will only accelerate warming. In 2012, Shell became the first company to drill exploratory wells in U.S. Arctic waters, raising concerns about the local and global environmental impact. (For more on this, check out the great documentary produced by the Center for American Progress oceans team).
Shell’s troubles throughout the year proved just how tough it is to drill in the region. From crushing its oil containment unit “like a beer can” to losing control of its drilling rig, the company faced numerous challenges. And major organizations responded. In April, insurance giant Lloyd’s of London warned that responding to an oil spill in a region that is “highly sensitive to damage” would present “multiple obstacles, which together constitute a unique and hard-to-manage risk“; German bank WestLB announced it would not finance offshore oil or gas drilling in the Arctic, saying the “risks and costs are simply too high”; and Total SA, the fourth largest publicly traded oil and gas company in the world, said drilling in the region could be a “disaster.”
Renewable Electricity Nearly Doubles Under Obama
President Obama was attacked hard in 2012 for his promotion of renewable energy, green jobs, and environmental regulations. Many opponents claimed that stimulus investments in renewables didn’t work. But the figures told otherwise.
According to figures from the Energy Information Administration, non-hydro renewable electricity generation has nearly doubled since Obama took office, reaching 5.75 percent of net electricity. In 2008, before Obama entered the White House, non-hydro resources like solar, wind, geothermal, and biomass represented just over 3 percent of generation. While political uncertainty has made 2013 prospects for renewables uncertain, the U.S. has still maintained a strong role in the global market. Since 2004, one trillion dollars have been invested in the global clean energy sector, with a large portion of that coming from the American private and public sectors.
This is just a small selection of the many important stories throughout the year. Tell us what your top energy stories are below.
jQuery(document).ready(function(){jQuery('#comment_submit').click(function(){if(jQuery('#comment_check:checked').lengthWeekly Address: Congress Must Protect the Middle Class from Income Tax Hike
The White House
Office of the Press Secretary
Hello Everybody. For the past couple months, I’ve been working with people in both parties – with the help of business leaders and ordinary Americans – to come together around a plan to grow the economy and shrink our deficits.
It’s a balanced plan – one that would protect the middle class, cut spending in a responsible way, and ask the wealthiest Americans to pay a little more. And I’ll keep working with anybody who’s serious about getting a comprehensive plan like this done – because it’s the right thing to do for our economic growth.But we’re now at the point where, in just a couple days, the law says that every American’s tax rates are going up. Every American’s paycheck will get a lot smaller. And that would be the wrong thing to do for our economy. It would hurt middle-class families, and it would hurt the businesses that depend on your spending. And Congress can prevent it from happening, if they act now. Leaders in Congress are working on a way to prevent this tax hike on the middle class, and I believe we may be able to reach an agreement that can pass both houses in time.But if an agreement isn’t reached in time, then I’ll urge the Senate to hold an up-or-down vote on a basic package that protects the middle class from an income tax hike, extends vital unemployment insurance for Americans looking for a job, and lays the groundwork for future progress on more economic growth and deficit reduction. I believe such a proposal could pass both houses with bipartisan majorities – as long as these leaders allow it to come to a vote. If they still want to vote no, and let this tax hike hit the middle class, that’s their prerogative – but they should let everyone vote. That’s the way this is supposed to work. We just can’t afford a politically self-inflicted wound to our economy. The economy is growing, but keeping it that way means that the folks you sent to Washington have to do their jobs. The housing market is healing, but that could stall if folks are seeing smaller paychecks. The unemployment rate is the lowest it’s been since 2008, but already, families and businesses are starting to hold back because of the dysfunction they see in Washington. You meet your deadlines and your responsibilities every day. The folks you sent here to serve should do the same. We cannot let Washington politics get in the way of America’s progress. We’ve got to do what it takes to protect the middle class, grow this economy, and move our country forward.Thanks, everybody.
President Obama urges Congress to meet its deadlines and responsibilities, protect the middle class from an income tax hike, and lay the groundwork for future progress on more economic growth and deficit reduction.
Take a look at the videos that have been viewed the most.
At a press conference following a meeting with Senate and House leaders, the President said that he is optimistic an agreement that can pass both houses will be reached in time.
view all related blog postsThe Year In Solar Power: Prices Crash, Sales Soar, Industry Restructures, Saudis Leap In, CSP Suffers
Financial Innovation and Collaboration Takes the Solar Cake
If you ask Tom Kimbis what he thinks was one of the most important developments of 2012 for solar energy, he may tell you something you didn’t quite expect to hear. Kimbis, VP of External Affairs for the Solar Energy Industries Association (SEIA), says that much of the credit for what’s being seen as a landmark year for downstream solar growth belongs not to technical innovations, but financial innovations — the kind that are making it increasingly possible for people everywhere to be able to afford solar without having to take out a second mortgage on their homes.
“Innovation can take place throughout the entire value chain,” Kimbis said. “We’ve seen phenomenal innovation with the various leasing and third party ownership models that have driven the markets in the U.S. forward more than the increase in cell efficiency.”
According to the U.S. Solar Market Insight Report, which was released by SEIA and GTM Research, 2012 has seen total installed solar capacity in the United States reach 1,992 MW. This far exceeds the annual total capacity reached in 2011, which was 1,885 MW — a not inconsiderable accomplishment, considering that 2012 isn’t even over yet. There were 684 MW of solar capacity installation in the third quarter of 2012 alone, and in that same time frame the residential PV sector installed over 118 MW of capacity.
Kimbis credits the biggest quarterly growth yet for U.S. residential PV to an increase in third party solar leasing options for consumers, which he likens to financial options that car buyers have — where instead of having to pay cash, leasing or financing options help make ownership a possibility. “Overcoming that first cost issue is what the third party ownership’s all about,” Kimbis said.
Upstream financial collaborations also led to the green lighting of numerous global projects in 2012, including the Letsatsi and Lesedi solar farms in South Africa. Both were made possible by dollars from U.S. developer SolarReserve and two local companies, Intikon Energy and Kensani Capital. In Peru, OPIC came together with Latin America’s development bank CAF and investment firm Conduit Capital Partners for the funding of two solar projects that will result in a combined solar capacity of 40 MW.
Oversupply Goes Up, PV Cost Goes Down
Despite a boom in solar demand in the United States in 2012 and a growth rate which SEIA estimates will be at about 70 percent over last year (compared to 14 percent global market growth), the reality of global PV panel oversupply remains an issue of concern.
In 2012, that oversupply led to a showdown between Chinese solar manufacturers and the United States Department of Commerce. Chinese manufacturers were accused of dumping their oversupply into the U.S. market at such low prices that they injured the ability of US-based solar manufacturers to compete fairly. This ultimately led to a decision by the International Trade Administration to levy tariffs to levy tariffs on the importation of solar modules using cells manufactured in China. In the final ruling, it was announced that the tariffs would range from 24 percent to 36 percent.
Alas, the old adage about every cloud having a silver lining may be very true, especially if you look at it from a global perspective. In 2012, oversupply led to low cost, which in turn drove an increased global expansion in development among wealthy and developing nations alike, all eager to capitalize on the low cost of materials.
Marc Norman, lawyer for Chadbourne & Parke LLP and director of the Emirates Solar Industry Association (ESIA), called this a possible case of “creative destruction” that’s given developing countries an opportunity to enter the solar game.
Norman said that the low cost of solar PV could enable developing countries in particular to benefit from solar technology without even being connected to the power grid. “Solar technology can be applied off-grid,” Norman said. “For example, in rural areas where there’s a lack of infrastructure. There’s a golden opportunity for more bottom-up market evolution, as opposed to a more traditional top-down approach.”
Kimbis agrees, noting the inherent irony: “Falling pricing is a double edged sword. It’s great for deployment, it’s great for the consumer, and it’s caused greater amounts of solar installation. On the other hand, falling prices have yielded smaller margins for manufacturers, making it tougher to survive in a very competitive climate.”
Industry Jobs and Widespread Bankruptcies
In the United States, 2012 showed evidence that growth in the solar industry occurred at a much faster rate than other industries. According to The Solar Foundation’s National Solar Jobs Census report, U.S. employment in the solar industry grew at a rate of 13.2 percent and the sector added 13,872 jobs in 2012, while Bureau of Labor statistics indicated that solar accounted for 1 out of every 230 jobs created.
This information may seem to fly in the face of the numerous solar company bankruptcies and consolidations that have taken place globally in the last year, but according to Kimbis, that’s par for the course in an emerging industry.
“It’s just like any other industry,” Kimbis said. “Competition is extreme. This is something that the industry has known about for awhile; companies have been bracing for global competition for the last several years. It’s a story which has repeated itself through everything from personal computing, to telecom, to the automobile industry.”
Job outlook, while encouraging within the United States, was not so rosy in China in 2012. In November, it was reported that Suntech Power Holdings (which is the world’s biggest maker of solar panels) would be shedding some 1,500 jobs in China to reduce operating costs and ratchet down on solar cell capacity.
Saudi Arabia: The Dark Horse
When discussing landmark events in solar, it’s impossible to ignore what took place in Saudi Arabia earlier in 2012. In May, the King Abdullah City for Atomic and Renewable Energy (also known as K.A.CARE) established the goal to develop 54,000 MW of renewable energy capacity by 2030.
Why is an oil-rich nation like Saudi Arabia concerned with adopting renewable energy? Quite simply, to limit the local consumption of oil so that exports can be increased. With low cost access to oil and unchecked usage, it’s believed that Saudi Arabia could find itself entirely out of the oil exportation business by 2030.
Under K.A.CARE’s proposed plan, 41,000 MW of the total 54,000 MW capacity will come whole from solar: 16,000 MW from photovoltaic (PV) projects and 25,000 from solar thermal projects. As a first phase, 700 MW of utility-scale projects are set to be undertaken by the end of 2013.
Norman calls the K.A.CARE program “a massive game changer for the global renewable energy industry, and particularly solar” and says that it could also have a beneficial impact on the local job market in Saudi. Unemployment is estimated at around 10 percent in the Kingdom. “The government sees this as an opportunity to create a global center of excellence for renewables, in addition to job creation.”
Norman explains that Saudi Arabia will require a certain percentage of local content on all renewables projects; this is seen as a means to stimulate the local job market.
2012’s Impact on CSP
With the low cost of solar PV panels, some may wonder what impact 2012 had on the solar thermal market, of which concentrated solar power (CSP) is a big part. Did CSP suffer due to the comparatively low cost of solar PV? It depends on who you ask, really.
The answer to that question, according to Norman, is obvious. “As a result of the reduction in PV prices, CSP has taken a hit in the last few years,” Norman said. “But they also have an advantage that can’t be overlooked, and that’s storage. Some developers have devised CSP plants that can store energy. That’s something that PV technology can’t measure up to at present.”
Not everyone sees 2012 as having been a good year for CSP. Jigar Shah, partner at Inerjys Ventures, predicted the death of CSP as far back as 2007 and calls it a technology that’s officially punched the big ticket. “I think in 2012, CSP basically died,” Shah said. “Siemens shut down their CSP plant. Areva is building one unit in Morocco, but they shut down CSP plants in Australia and a few other places. BrightSource wasn’t able to go public, so they’ve got an existing utility contract they’re honoring with an existing DOE loan guarantee — and I don’t think anyone believes that they’re going to get a second contract. CSP is dead.”
While the aforementioned U.S. Solar Market Insight Report mentioned several large scale CSP projects underway in the United States, it was reported that the third quarter of 2012 saw no new capacity installed in that segment.
Additional Solar Highlights from Around the World in 2012
In June, Chile brought its largest PV plant online. Although modest in comparison with the scope of other global projects, the 1 MW Calama Solar 3 was an important step that has since resulted in increased interest among developers and investors. There were other notable Latin American solar developments in 2012, including two Peruvian solar farms (the already operational Tacna solar farm and the still in production Panamericana solar farm) whose combined generating capacity will reach 40 MW.In Germany, a 145 MW solar park in Neuhardenberg, Brandenberg, was constructed in a record-breaking five weeks. The solar park was finished just under the wire to beat the expiration of subsidies for PV installations greater than 10 MW in size. The construction of Neuhardenberg solar park, which is scheduled to be fully operational by the end of 2012, helped push Germany’s total installed solar capacity for the year to over 7,000 MW.8minuteenergy Renewables, a solar PV developer located in southern California, received the financial stamp of approval in November to proceed with construction on a project that, once in operation, will be the largest PV farm in the world. The Mount Signal solar farm, which is being constructed in Imperial Valley, will generate 800 MW (DC) of utility-scale energy.The Charanka Solar Park in Gujarat, India, is home to numerous independent solar power stations, occupying approximately 2000-hectares of land. While many the park’s solar stations remain in production, 2012 saw its combined total output capacity reach nearly 700 MW.In an effort to shore up their enormous oversupply of solar panels, China decided in 2012 to underwrite a $1.6B loan — through the China Development Bank (CDB), which is seen as the engine behind the country’s economic development — to essentially create downstream demand within its borders. The loan was given to Shanghai-headquartered Sky Solar, which earlier in 2012 broke ground on two PV projects in China: one 800-MW project in the Xinjiang Province, and another 50 MW plant in the Qinghai Province.Vince Font is a professional freelance writer specializing in the fields of renewable energy, high tech, travel, and entertainment. Read his blog at www.vincefont.com or follow him on Twitter @vincefont. This piece was originally published at Renewable Energy World and was reprinted with permission.
Weekly Address: Congress Must Protect the Middle Class from Income Tax Hike
The White House
Office of the Press Secretary
Hello Everybody. For the past couple months, I’ve been working with people in both parties – with the help of business leaders and ordinary Americans – to come together around a plan to grow the economy and shrink our deficits.
It’s a balanced plan – one that would protect the middle class, cut spending in a responsible way, and ask the wealthiest Americans to pay a little more. And I’ll keep working with anybody who’s serious about getting a comprehensive plan like this done – because it’s the right thing to do for our economic growth.But we’re now at the point where, in just a couple days, the law says that every American’s tax rates are going up. Every American’s paycheck will get a lot smaller. And that would be the wrong thing to do for our economy. It would hurt middle-class families, and it would hurt the businesses that depend on your spending. And Congress can prevent it from happening, if they act now. Leaders in Congress are working on a way to prevent this tax hike on the middle class, and I believe we may be able to reach an agreement that can pass both houses in time.But if an agreement isn’t reached in time, then I’ll urge the Senate to hold an up-or-down vote on a basic package that protects the middle class from an income tax hike, extends vital unemployment insurance for Americans looking for a job, and lays the groundwork for future progress on more economic growth and deficit reduction. I believe such a proposal could pass both houses with bipartisan majorities – as long as these leaders allow it to come to a vote. If they still want to vote no, and let this tax hike hit the middle class, that’s their prerogative – but they should let everyone vote. That’s the way this is supposed to work. We just can’t afford a politically self-inflicted wound to our economy. The economy is growing, but keeping it that way means that the folks you sent to Washington have to do their jobs. The housing market is healing, but that could stall if folks are seeing smaller paychecks. The unemployment rate is the lowest it’s been since 2008, but already, families and businesses are starting to hold back because of the dysfunction they see in Washington. You meet your deadlines and your responsibilities every day. The folks you sent here to serve should do the same. We cannot let Washington politics get in the way of America’s progress. We’ve got to do what it takes to protect the middle class, grow this economy, and move our country forward.Thanks, everybody.
President Obama urges Congress to meet its deadlines and responsibilities, protect the middle class from an income tax hike, and lay the groundwork for future progress on more economic growth and deficit reduction.
At a press conference following a meeting with Senate and House leaders, the President said that he is optimistic an agreement that can pass both houses will be reached in time.
A new release of White House visitor records brings the grand total of records that this White House has released to more than 2.8 million.
view all related blog postsGOP Senators Want To Take Debt Ceiling Hostage In Order To Raise Retirement Age
Two Republican senators want to use the threat of an economic meltdown to raise the retirement age and cut Medicare. Sens. Bob Corker (R-TN) and Lamar Alexander (R-TN) introduced a plan today that would raise the federal debt limit by $1 trillion in exchange for $1 trillion in cuts to Medicare, Medicaid, and Social Security, as The Hill reported:
The Corker-Alexander dollar-for-dollar plan has several components.
It would structurally reform Medicare by creating competing private options giving seniors greater choice of healthcare plans. It would not, however, cap Medicare spending.
The plan would also give states more flexibility to manage Medicaid programs and prevent states from “gaming the federal share of the program with state tax charges.”
It would gradually raise the Social Security retirement age and use the “chained CPI” formula to calculate cost-of-living adjustments, curbing the growing cost of benefits.
In exchange, it would direct the debt limit be increased by the same amount as the savings generated from entitlement reform.
The U.S. will hit its debt limit on or around December 31st. The Treasury Department estimates that, using extraordinary measures, it could avoid default for another two months or so. Allowing the U.S. to default on its debt via not raising the debt ceiling could cause a complete financial meltdown. The 2011 debt ceiling debacle — during which House Republicans nearly pushed the country into a default due to their intransigence on taxes — cost the country about $19 billion in higher interest payments and at least one million jobs.
Corker and Alexander are threatening more economic chaos in order to achieve one of the most regressive potential policy changes. Though lawmakers point to America’s increasing life expectancy in order to justify raising the retirement age, life expectancy is only increasing for wealthier workers in non-physical jobs. As the Center for Economic and Policy Research put it, “there has been a sharp rise in inequality in life expectancy by income over the last three decades that mirrors the growth in inequality in income.”
Statement by the President
The White House
Office of the Press Secretary
5:52 P.M. EST
THE PRESIDENT: Good afternoon, everybody. For the past couple of months, I’ve been working with leaders of both parties to try and forge an agreement that would grow our economy and shrink the deficit -- a balanced plan that would cut spending in a responsible way but also ask the wealthiest Americans to pay a little more, and, above all, protect our middle class and everybody who is striving to get into the middle class.I still want to get this done. It’s the right thing to do for our families, for our businesses, and for our entire economy. But the hour for immediate action is here. It is now. We’re now at the point where, in just four days, every American’s tax rates are scheduled to go up by law. Every American’s paycheck will get considerably smaller. And that would be the wrong thing to do for our economy, it would be bad for middle-class families, and it would be bad for businesses that depend on family spending. Fortunately, Congress can prevent it from happening if they act right now.I just had a good and constructive discussion here at the White House with Senate and House leadership about how to prevent this tax hike on the middle class, and I’m optimistic we may still be able to reach an agreement that can pass both houses in time. Senators Reid and McConnell are working on such an agreement as we speak.But if an agreement isn’t reached in time between Senator Reid and Senator McConnell, then I will urge Senator Reid to bring to the floor a basic package for an up-or-down vote –- one that protects the middle class from an income tax hike, extends the vital lifeline of unemployment insurance to two million Americans looking for a job, and lays the groundwork for future cooperation on more economic growth and deficit reduction. I believe such a proposal could pass both houses with bipartisan majorities as long as those leaders allow it to actually come to a vote. If members of the House or the Senate want to vote no, they can –- but we should let everybody vote. That’s the way this is supposed to work. If you can get a majority in the House and you can get a majority in the Senate, then we should be able to pass a bill. So the American people are watching what we do here. Obviously, their patience is already thin. This is déjà vu all over again. America wonders why it is that in this town, for some reason, you can't get stuff done in an organized timetable; why everything always has to wait until the last minute. Well, we're now at the last minute, and the American people are not going to have any patience for a politically self-inflicted wound to our economy. Not right now. The economy is growing, but sustaining that trend is going to require elected officials to do their jobs. The housing market is recovering, but that could be impacted if folks are seeing smaller paychecks. The unemployment rate is the lowest it’s been since 2008, but already you're seeing businesses and consumers starting to hold back because of the dysfunction that they see in Washington. Economists, business leaders all think that we’re poised to grow in 2013 –- as long as politics in Washington don’t get in the way of America’s progress. So we've got to get this done. I just want to repeat -- we had a constructive meeting today. Senators Reid and McConnell are discussing a potential agreement where we can get a bipartisan bill out of the Senate, over to the House and done in a timely fashion so that we've met the December 31st deadline. But given how things have been working in this town, we always have to wait and see until it actually happens. The one thing that the American people should not have to wait and see is some sort of action. So if we don’t see an agreement between the two leaders in the Senate, I expect a bill to go on the floor -- and I've asked Senator Reid to do this -- put a bill on the floor that makes sure that taxes on middle-class families don’t go up, that unemployment insurance is still available for two million people, and that lays the groundwork, then, for additional deficit reduction and economic growth steps that we can take in the New Year. But let's not miss this deadline. That’s the bare minimum that we should be able to get done, and it shouldn’t be that hard since Democrats and Republicans both say they don’t want to see taxes go up on middle-class families. I just have to repeat -- outside of Washington, nobody understands how it is that this seems to be a repeat pattern over and over again. Ordinary folks, they do their jobs. They meet deadlines. They sit down and they discuss things, and then things happen. If there are disagreements, they sort through the disagreements. The notion that our elected leadership can't do the same thing is mind-boggling to them. It needs to stop. So I'm modestly optimistic that an agreement can be achieved. Nobody is going to get 100 percent of what they want, but let's make sure that middle-class families and the American economy -- and, in fact, the world economy -- aren't adversely impacted because people can't do their jobs. Thank you very much, everybody.END 5:57 P.M. EST
President Obama urges Congress to meet its deadlines and responsibilities, protect the middle class from an income tax hike, and lay the groundwork for future progress on more economic growth and deficit reduction.
At a press conference following a meeting with Senate and House leaders, the President said that he is optimistic an agreement that can pass both houses will be reached in time.
A new release of White House visitor records brings the grand total of records that this White House has released to more than 2.8 million.
view all related blog posts
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