Wind Power: From T.Boone to Bust!

Last year, when T. Boone Pickens was promoting his wind power agenda, the left and the left-leaning media couldn't get enough of him. From Al Gore to Barack Obama and the Democratic members of Congress, T. Boone's plan was music to their ears. ABC, CBS, NBC and PBS touted the benefits of his plan. The New York Times, Newsweek, the Washington Post and other lefty printed media spared no ink on the topic. All was glowing and positive for his wind power project. For the lefties, it was the greatest story ever told: An Oil Man Going Green. Who'da ever thought?

So, it's no wonder that hardly anything was even printed or even verbally reported this week when T. Boone announced that he, at the very least, is suspending his wind power plan; if, not, completely abandoning it (See Full Story). You gotta know that the left just hates to report any negative or bad news about America going green. They would prefer to let us all believe that wind power is the only way to go. You know. It will save America money and create all those new jobs. But, here's a self-made billionaire who spent $2 billion in upfront money and can't make a go of it. That should tell us all something.

Because his plan was never really cost effective in the first place and because it was heavily dependent on the deep and dumb pockets of the American taxpayer, the economic downturn has just completely demolished his dreams of making another billion or more in profits for himself. He was hoping that oil would stay high and the Obama Administration would fund all the unfunded and extremely expensive grid requirements that would be needed to make his scheme both work and payoff big-time for him. But the recession changed all that.

Just like my previous report on that EPA Report that contradicted Global Warming and which was buried by Obama and his people, this, too, is another example of how the left hides the truth from Americans in order to promote their ideological agenda.

In the wake of T. Boone's wind power bust, he has now moved on to promoting natural gas to replace gasoline and diesel in cars, trucks, and buses (See Full Story). Apparently, like having a bunch of Brooklyn Bridges to sell us, Mr. Pickens sees big bucks being made by a little company he owns that is called: Clean Energy (See their Website). It just so happens that this company is a leading producer of natural gas in the United States and Canada. They also own most of the natural gas delivery and fueling stations in this country and in Canada. What a coincidence! Now he just needs a "cooperative government" to both mandate and fund natural gas powered cars and refueling stations.

One way or another, Pickens is bound and determined to make some money off all these Democrats who are in charge of government. Wind didn't work; maybe gas will. Let's not forget. The only "green" that Mr. Pickens is really interested in is the green that makes up the color of money.

Will OPEC Cheat On Each Other?

This morning, oil fell below $64 a barrel. This was a drop of around $4. In September, before the true extent of all this credit mess was known, I thought we could get down to $60 a barrel when some, like T. Boone Pickens, were predicting a mere fall to $80. I knew, based on my years of experience in investing, that the $80 a barrel level would be overshot; but, not quite this fast (See my Septemeber 2nd blog entry: "Is $80 or $60 A Barrel Oil in Our Future?").

I now think that a price below $50/barrel is achievable and, contrary to my previous blog entry, I think oil prices may be held below $80 a barrel throughout 2009.

Also seeing that potential, OPEC is now in panic mode. At their emergency meeting this morning, they immediately cut oil by 1.5 million barrels a day to stabilize prices (See Full Story). The downdraft in oil is killing government revenues of state-run oil operations in countries like Saudi Arabia, Venezuela, Iran, and Russia. Take, for example, Venezuela. If you assume that Venezuela is exporting about 2.4 million barrels of oil per day, the difference in revenues when oil was at a high of $147 and the current price of $63 is one big hurt. It puts a serious dent in Chavez' plans to buy more military toys like planes, helicopters, tanks and guns.

When oil was going up, the OPEC cartel was fairly disciplined. They could see the benefits of holding the production levels to force prices up. In this down draft, however, the honor among these thieves might not be as true. OPEC has always had a history of cheating on production levels so they could sneak extra profits in for their country's coffers. My guess is that the falling oil prices will restore OPEC members to their "cheating ways". That's why I think $45 a barrel (maybe, even lower) may be achievable.

One last comment. These oil prices will, again, kick the chair out from underneath any plans for offshore drilling. Once again, it will be oil prices coming down that will set us up for another energy crisis in the future; once the world economies starts to stabilize. Once again, we will have lost another couple of years or more in drilling ourselves out of our dependence on foreign oil. That's because, sadly, our politicians will have responded to these temporary low prices as they have always done in the past, by not doing anything. Believe me, wind and solar plans by the Obama and the Democrats, won't even make a dent in those 200 million cars that we have on our city streets.

A Truth (or three) About Compressed Natural Gas

The TV ads regarding Compressed Natural Gas (CNG) say that it is clean, cheap, and it is American. Well, not quite.

Let's address the last point first about CNG being American. As a country, we import more than 15 percent of the natural gas we use (See Full Story). If it is so American, why, then, would have to import any of it? The TV ads also mentions the abundant gas reserves in shale basins. However, just like drilling for oil, we can't get to it because drilling and extracting natural gas from those areas is being blocked by the Democrats in Congress and by the environmentalists. That's why we import.

In terms of being clean? Yes, it is. It certainly doesn't contain the contaminants like sulfur that is produced when burning petroleum-base fuels and coal. However, it is still a fossil fuel and, for that, it gets a big "F" for cleanliness from the likes of Al Gore. Burning natural gas produces carbon and it is carbon, if you listen to the Global Warmists, that is causing the excess heating of the earth. That's why you will never hear a democrat promote natural gas. Just listen to Barack Obama and you would know this. He doesn't mention natural gas at all. He primarily talks about solar and wind.

Lastly, let's address the issue of natural gas being cheap. Compared to gasoline it is 40 percent cheaper. For a vehicle that it is specifically designed and built for natural gas it is cheaper to operate. But, that vehicle isn't. It will cost a few thousand more dollars to build than a gasoline version of the same car. Existing vehicles can cost between $8000 and $50,000 (for trucks and buses) to convert to natural gas. Even at 40 percent cheaper than gasoline, it would take the life of the car to recoup the increased costs of buying or converting a natural gas vehicle as opposed to a gasoline vehicle of the same type and size.

The purpose of all these TV ads by T. Boone Pickens and Aubrey McClendon of Chesapeake Energy Corp. is to get Congress and the American people behind exploring and drilling for natural gas. They both have a financial incentive to do so. By running these TV commercials, their hope is that the environmentalist that have been so adamant in blocking natural gas production are put aside by the public's need to get off foreign oil. They also hope that additional markets are created for natural gas by moving vehicles to this form of fuel.

This is not to say that Messrs. Pickens and McClendon only have a profit motive behind their beliefs. In fact, I firmly believe that they are very patriotic. They both can see a real pathway to our independence from foreign oil. Natural Gas is something that both these people know and know that it is capable of creating that independence. But, so are other alternatives. As I have said in this blog many times before, we need it all. Natural gas is just one facet in our energy future. We should include drilling for our own oil (to support our existing base of vehicles and power production), nuclear energy (because it is so clean and carbon free), wind and solar (because of the like benefits to nuclear; but, not to the extent being promoted because they have the downside of requiring mammoth space to produce energy), clean coal (as an abundant source of energy) and biofuels like ethanol and bio-diesel (as long as they don't infringe on food production in this country).

But, all these forms of energy are simply bridges to our energy future. I personally think that our future is in hydrogen technologies. It is clean, renewable, and almost infinitely available in this world. We can use nuclear, wind, and solar to provide the energy needed to cleanly extract hydrogen from sources like natural gas or, even, from water. That should be the long-range goal of this country.

Compressed Natural Gas (CNG)

I hate to do it again but, I have some more problems with T.Boone Pickens plan for getting us off foreign oil. While I agree that Compressed Natural Gas is a possible means to that end, I, at best, only believe it to be a stop gap and short-lived alternative.

Certainly, natural gas resources are absolutely abundant in the United States and cheaper to extract that oil. As a fuel though, it is a "weak" alternative over gasoline. It really lacks the power for high power applications such as trucks and diesel trains. That's because the energy rating of natural gas is lower than either gasoline or ethanol.

Secondly, because it is primarily a gas and not a liquid, there are serious problems with the on-board storage in an automobile or any other vehicle. When a car is converted to natural gas, several tanks are used to replaced the single traditional gasoline tank. Often, tanks are added below the floor of the passenger compartment. Even with additional tanks, the driving range is generally half that of a gasoline powered vehicle.

Third, retrofitting existing vehicles is very expensive. While there are some claims that an automobile can be converted for as little as $8,000, the general assumption is that cars will, at a minimum, cost $12,000 to be retrofitted. Buses and trucks will cost upwards of $50,000 to convert to CNG.

Fourth, there needs to be an infrastructure built to accommodate CNG powered cars. Up until now, most CNG operated vehicles are fleet vehicles for locally-based operations such as government vehicles or city buses. The filling operations for those vehicles have been built at the parking and garage facilities for those vehicles. Under T. Boone Picken's plan, CNG filling stations will literally have to be built from coast to coast to accommodate the average American driver. Unlike a gasoline filling stations, with their fuel tanks and pumps, a CNG filling station requires more expansive underground storage space because it is a "pressurized" gas and not a liquid. The storage tanks are more expensive because the must handle high pressure levels and the OSHA/EPA requirements are stringent. Additionally, the drive-up filling operation is more complex and needs higher maintenance to insure that there is no leakage. The coupling to a car is under very high pressure and must be checked and serviced quite often to insure a tight seal. This adds to the operational cost of CNG filling station and those costs are substantially higher than the typical gasoline filling station. A CNG service station will cost $200,000 or more to build. That is a cost that is over-and-above typical gasoline service station. Because CNG is less compact than liquid gasoline, the tanker operations to keep these stations with full tanks has to twice as frequent as a gasoline tanker truck operation. The additional capital cost of setting up CNG filling stations across this country could be a seriously limiting factor; especially in small town America where an extra $200,000 might never be available to build a CNG operation. Without expansive refilling operations being available, the consumer will avoid CNG operated vehicles.

Another consideration is the dangers associated with CNG. In an automobile accident, a ruptured CNG tank is actually safer than a rupture of a gasoline tank. If a rupture gas tank catches fire, the gas, which is lighter than air, will escape upwards into the sky and act like a blow torch that is localized at the point of exit. Gasoline, on the other hand, will spread on the ground and a fire could ensue wherever the liquid gasoline winds up. The real problem could be an accident in an enclosed space such as in a tunnel or some kind of enclosed parking garage. In that case the CNG could be trapped and the explosion could be like a bomb going off. Leaking tanks in the average homeowners garage could explode if ignited by a spark from a light switch or from a garage-installed gas water heater.

For those "global warming" proponents, CNG is just another form of carbon-based fuel that will not head off ocean front properties being created in the Rockies when all the ice melts (Just a joke!). Don't expect Al Gore and his Democratic followers to jump on the CNG bandwagon. Sorry, T. Boone!

Lastly, even T.Boone Pickens admits that CNG is merely a stop-gap or bridge to future fuels like hydrogen. Why then would anyone buy into it. That would be like buying a Sony BetaMax video tape system; knowing the VHS would, ultimately, become the standard.

I think that if we are going to have a plan, it should be one with staying power like hydrogen. In the meantime, I think that we should do everything from drilling, to hydroelectric, to biofuel, to nuclear, etc. to get by. Where CNG makes sense, then let's do it. But we should settle on what should be the energy of the future and use our government research and spending to achieve that goal. We have a lot of natural gas and coal, we just need to "wisely" use it to both our short-term and our long-term advantage. But, "completely" investing in a short-term CNG plan is not what we should be doing. That's just my opinion.

Taking Even More Wind Out of Wind Power

In this blog, I have been consistently negative on any hopes that wind power will be the "savior" of our planet and the "future" of our energy needs. No matter what T. Boone Pickens, Barack Obama, and Nancy Pelosi (who owns a lot of T.Boone's Clean Energy Company stock) say, wind power is not our future. At best, wind might supply 20% of our Nation's power requirements. But, in getting to that level of power production in this country, it will be a road of one court battle after another. Ted Kennedy and Robert F. Kennedy, Jr. famously proved this when they blocked a wind farm near their precious "Kennedy compound" off the shores of Hyannis Port, Mass (See Full News Story). As you can see from that news story, the Pentagon joined the Kennedy's in blocking that Wind Farm because it posed a potential "radar blocking" effect. While that news story is over 2 years old, the wind farm off Cape Cod has been in litigation and the process of environmental impact studies since 2002. Now, after nearly 6 years, the studies continue (See Full Story). The current plans are to "start" building in 2010. All tolled, this project will probably be more than 12 years in the process. Does anyone remember the Democrats and Barack Obama quoting 8-10 years before we would get any oil out of the Arctic National Wildlife Resource (ANWR)? Also, as noted in that first news story, the objections by the Pentagon have jeopardized other wind project projects around this country.

The Pentagon and the wealthy elitists like the Kennedy's aren't the only one's that the wind farm proponents across this country will have to worry about and battle. There are always the environmental and conservationist elitists who are ready to block anything that hasn't been put on earth by God. They will be blocking wind farms because of the impact on wildlife. They will argue that these structures will have detrimental impact on bird migration and their foraging and nesting habits and habitats. Wind farms will pose a threat to wildlife and insects because of the noise and ground vibration they create. For sure, the great "vistas" of this country will need to be protected from these gigantic monstrosities of mankind.

Now, taking even more wind out of wind power, there comes this latest impediment: a health risk to man (See Full Story). You can also expect that many communities will simply fight wind farm implementation over the noise that they produce or how ugly they look (See Full Story). In this country, even if a million land owners agree to put tens of millions of wind turbines on their "own" land, it only takes one lawsuit from an average citizen and one sympathetic judge or jury to put the whole thing on ice.

Believe me, all this campaign rhetoric over wind power is just that. When people like Nancy Pelosi block this country's drilling for its own oil because she's "saving the planet" is just bunk. As you can see, it can take years (12 or more in the case of Cape Code) for a single wind project to be completed. In the mean time, the national oil supply will keep dwindling and our foreign dependence on oil will keep increasing. All this "hope" from the Democrats is pure idiocy. In 2006, Nancy Pelosi "promised" that, if the Democrats won, they would "Take Back America". In her statement of June 2006, she "promised" to reduce our dependence on foreign oil and lower our costs. Two years later and nothing has happened. We have increased our dependence on foreign oil and our price at the pump has nearly doubled. We are nowtwelve years past the date when Bill Clinton vetoed the bill that would have allowed us to drill in the Arctic National Wildlife Refuge. Twelve years!

To me, the only thing standing between the United States and any true energy independence is reason and our courts. We need to be realistic about wind power. We are not going to have millions of wind turbines blanketing our country. The environmentalists, the conservationists, and the average Joe (who doesn't want to live next to one) aren't going to let it happen. I find it interesting that in 2007, Nancy Pelosi, in her required financial disclosure forms, declared that she got upwards of $250,000 in interest/income benefits from the company called Clean Energy Fuels Corp. That is a T. Boone Pickens company and the same company that will be building the wind farms that T.Boone keeps talk about in his TV commercials (See Full Story). A smart investment? Sure! Especially, if you in a position of power to make that company more profitable. T. Boone Pickens and Nancy Pelosi might be just a little self-serving in their plans for America's energy.

As Americans, we need to send a message that we aren't happy with the status quo. We just can't remain in a state of frozen animation on energy. We can do this in writing to our Representatives or, we can send a message in the General Election with our votes. I would hope that more than just a few Americans choose the latter action.

A Couple Of "Big" Oil Guys

Over the last two weeks, T. Boone Pickens, an oil-made billionaire, has been airing a TV-ad where he's been telling America we need to get off oil (See Full Story). This advertisement clearly implies "wind power" as the key to our energy independence. Pickens, himself, has invested nearly two billion dollars in creating wind power in the State of Texas.

Texas is an interesting State in our Union. Once, along with Oklahoma, it was the biggest oil producer in the United States. It is the home of many "big oil" companies. But, today, it is already the biggest "wind energy producer" in the country and soon to be even bigger (See Full Story).

What a lot of people don't know about this whole Texas-wind-thing is that George W. Bush started it all when he was Governor of Texas and pushed for and signed into law a wind-power mandate in 1999 (See Full Story). What T. Boone Pickens is doing today with wind wouldn't even be possible without that legislation. If you listen to the Democrats, they would say George W. is in bed with big oil and not interested in clean renewable energy. Right! Now, the nation's foremost, environmentally clean, wind power project has come to fruition from a couple of "big oil" guys. Go figure. (And, don't always believe all the politician's lies and how they portray people!)

Image by ninjawil's photostream on Flickr with Creative Commons Licensing (Click to View Other Works).