Energy: Drilling for Oil Offshore and in ANWR; Has the Time Come?

Okay, brace yourself. If you're a dyed-in-the-wool environmentalist, you're not going to like what I'm about to write. I'm not sure you'll like it if you're on the other extreme either, but what the hell.

I'm wondering whether it may be time to reconsider drilling offshore, and to take a hard look at whether the Arctic National Wildlife Refuge (ANWR) can be developed for oil in an environmentally favorable way.

I'm not saying we should go ahead with either, but I do think we need to put both considerations on the table, put aside our emotions, look at the real impacts, weigh the options, and then decide.

There are several things we need to factor into our consideration:

1. Our dependence upon fossil fuels is not going away any time soon.

2. There are, according to some sources familiar with the situation, relatively abundant remaining sources of fossil fuels, offshore and on land. Most agree they will take too long to develop to have immediate impact, but they may extend the time-frame for alternatives to replace fossil fuels. And with prices what they are now, it's looking like now may be the time when these sources are actually viable.

3. It is not known whether ANWR is a viable source; there is little baseline data with which to make such a call. Some say the oil industry may be betting on the fact that developing ANWR will allow the life of Alaska's pipeline to extend beyond 2030, and make it more viable to recover smaller pools throughout the region.

4. Developing ANWR is likely to have little impact on today's prices. In a report last May, the Department of Energy estimated that it will result in a reduction of only 75 cents a barrel.

5. A recent study by the federal government's Energy Information Administration projects, in the best-case scenario, developing ANWR will engender a price reduction of around $1.44/barrel by 2027.

The same study claims drilling off the coasts of the US won't affect prices until 2030, as reported in the New York Times.

6. Global consumption of oil reached 85.2 million barrels a day in 2008, up from last year's 76.3 million. Another study, to be released this fall by the International Energy Agency (IEA), projects consumption will rise to 116 million barrels next year.

7. New techniques, such as directional drilling will continue to reduce the footprint per well-head on Alaska's North Slope, but there remains the issue of roads, housing, pipelines, and other facilities needed to bring the oil to market.

Those impacts could still be huge in ANWR, which is used by polar bears, caribou, and other animals as they search for places to give birth. (Birth is the most vulnerable stage in the life-cycle of some species.) Other biologists familiar with the area claim the stated impacts may be overdone.

As for the coasts, there are worthy concerns about impacts on human coastal communities, especially those that rely on fishing or tourism for their livelihoods. Our neighbors to the north and south have increased their off-shore development over the past decade with little or marginal impact on the environment.

8. New off-shore development will also take years to put in place.

9. Finally, there is a shortage of deep water drill-ships for offshore development, which are currently booked for the next five years, and we may be looking at a long time horizon with very little short-term impact.

Still, impact is impact, and while we're looking at alternative energy development, perhaps we need to consider how we will meet demand for fossil fuels while alternatives build momentum.

High demand, low supply rules the day. But if the benefits of off-shore and ANWR development are a long way off, is it worth the risk? Can we do without it? What if it can be demonstrated that the environmental impacts are negligible? What if, as Senator Ted Stevens of Alaska announced last week, we could put revenues in service of alternative energy projects?

I am not advocating a position for or against such development; I'm simply calling for a rational, emotion-free analysis before we move forward or rule it out.

Vacation Reflections: The View from South Florida

High winds and turbulent waters have kept us off the beach and boats this year in Hobe Sound.

As we retreat to the pool and search for alternative ways to play during Spring Break, it's afforded me more time than usual for reflection.

Real estate is in the dumps down here and sales are sluggish, according to people familiar with the situation. Foreclosures in South Florida continue to rise and the region leads the nation in inflation.

Even so, just driving around here there seems no shortage of development projects happening in Martin County, despite the economic slowdown.

There also seems to be an burgeoning concern about the South Florida environment and increasing sentiment favoring opportunities in the new green economy.

A few examples:

Publix Super Markets has a new organic market play, GreenWise, that is designed to capture a growing healthy food market segment. It started with small sections of shelf space in their regular stores, but is expanding to at least three freestanding locations in 2008.

Martin County has plans to purchase 1,900 acres of the Harmony Ranch and an additional 1,222-acre property near a Florida Power & Light power plant as part of the Comprehensive Everglades Restoration Plan.

Martin County has thus far spent $13.2M of an expected $25M in sales tax revenue for land conservation, according to Jim Sherman, assistant county administrator.

A recently released survey conducted by the South Forida Business Journal indicated that a majority of Florida residents approve of increased spending on the state's solar energy infrastructure.

87 percent of South Florida residents surveyed support such investments to help the Sunshine State seize a solar future. (See article: http://tinyurl.com/23soz4)

Wind projects are also picking up, with St. Lucie Wind leading the way, despite the usual NIMBY hang-ups associated with large wind farms. And Florida's DEP recently commissioned a study to assess the potential for inland wind development. With the wind at 20 mph the past few days around here, it seems an abundant resource.

So, the market fluctuations of the past few days continue to play out and potential bank collapses loom. All of this affects South Floridians, especially those in the housing market, as much if not more than elsewhere in the country.

In terms of what I see here on the Treasure Coast this week, there is little panic and much forward thinking. Of course, it could just be the effects of four days in the sun, but I don't think so.

Update: Representative Tim Mahoney (D-Palm Beach Gardens) on the future of Florida and the Treasure Coast: "We can never be a development-based state again. We cannot build our economy around home building. We're just running out of space. We have to have a new industry; we have to broaden our economy. The things we have to look at that are home runs for us are tourism, eco-tourism, biofuels, biotech."

Global Climate Change: Stuebi on New Scientist Climate Policy Poll

Polls can be meaningless. Sometimes its the sampling. Sometimes its untrustworthy respondents. Often, it's the interpreters who run roughshod over the results. It's easy to make a poll say what you want it to say: just ask the questions in a way that will give you the answers you want.

I'm skeptical about polls.

So is Richard T. Stuebi, the BP Fellow for Energy and Environmental Advancement at The Cleveland Foundation, and Founder and President of NextWave Energy, Inc:

"It seems to me that poll respondents give themselves far too much credit for being well-informed or magnanimous, relative to what they actually know or what will they will do when making real decisions that really affect them," Stuebi writes over at the CleanTech blog:

However, this past summer, a poll conducted and reported by New Scientist magazine did seem to shed some useful insights that policy-makers ought to consider. The reported highlights of the survey were that there was substantial public support in the U.S. for carbon limitations, that the public preferred outright standards to cap-and-trade or (egads!) carbon taxes, and that the desired focus of carbon reductions should be on the electric power sector than on vehicles (don't tread on SUV!).

In my view, the most illuminating finding was the weakness of support for carbon imitations if they induced any significant economic pain. In other words, respondents were fine with climate legislation -- as long as it really didn't cost much. On the other hand, when asked if they would support carbon emission requirements that would increase energy prices significantly -- which is likely to be the case to achieve the magnitudes of emission reductions that are widely viewed necessary to have meaningful impact in protecting the planet -- support evaporated.

But, Stuebi confesses, "This is one of the few instances where I actually believe what the poll results say, without any bias." The finding that changed his mind, Stuebi says, is "that -- to avoid catastrophic climate change during the balance of this century -- either we need to quickly develop a zero/low baseload carbon energy source that costs essentially no more than conventional coal generation, or that we quickly need to substantially increase U.S. political will and courage to endure economic sacrifice."

Stuebi's conclusion? "Either will be tremendously challenging. Failing on both counts could doom the planet."

Access the poll here: New Scientist

Clean Tech: Wind Some, Lose Some

Why do people hate wind farms?

Sure they are huge; the turbines have a large footprint, and may even chop up a few birds. But they also generate a heck of a lot of power, and are comparatively free from negative environmental impacts.

From a design perspective the sleek white towers and aerodynamic blades seem, well, elegant and forward-looking.

It's clear that opinions about wind farms, however, blow whichever way the wind does.

When I was visiting some friends in northern New York late in the summer, I learned about objections to the St. Lawrence Windpower project, a project of ACCIONA SA (Other OTC:ACXIF.PK). Even my friends don't want it and speculated about graft and insider deals going on behind the scenes. (I couldn't corroborate any of the latter.)

The project is supported by many small, family farmers in the area as a source of additional income. Objections stem from many weekenders and locals who claim the farms will spoil their viewsheds, interfere with migratory bird patterns, create excessive ambient sound -- there are even some outrageous claims that wind turbines cause cancer or sterility.

Who's right? It's hard to say.

There seems to be little evidence that birds are victims of wind turbines and, as for the other claims, the jury is out on whether turbines or transformers can lead to physical ailments beyond certain setbacks.

But the debate keeps getting more charged.

This week, two developments speak to the complicated business of wind farms. And, for those of us who want the US economy to fully embrace alternatives, it's a one-two punch between China and our own backyard(s).

On the one hand, China National Offshore Oil Corporation (CNOOC) announced plans to venture into renewable energy with the first off-shore wind farm in China. The project will be situated 37 miles from shore, in the Bohai Bay, home of a significant part of the company's oil production, according to CNOOC president Fu Chengyu.

It's a welcome move by CNOOC (NYSE:CEO), which needs to diversify beyond oil, something also much needed in a country where cleaner growth is a top priority of its leaders. And there will likely be more of a push for such clean tech moves in China in the wake of the pending environmental embarrassment of the 2008 Beijing Olympics.

Why offshore? Offshore wind generation is more expensive, but has greater capacity. On land, siting is critical; you need enough open space, unobstructed wind patterns, and minimal interference by the natural or built environments. On the open water, it is easier to capture sustained, higher wind speeds; there less surface resistance, especially in deep water.

But on sea as on land, it turns out, you still get a "Not In My Back Yard" (NIMBY) reaction.

This week in Massachusetts, the Cape Cod Commission denied Cape Wind's application to bury electric cables in Nantucket Sound. The company needs to lay the cables on the Sound floor to connect its proposed 420-megawatt offshore wind farm to the state power grid.

Cape Wind plans to challenge the Commission's decision; the Commission said it did not have enough information to make a decision. The proposed wind farm will consist of 130 GE 3.6 megawatt wind turbines, capable of supplying most of the electricity needed in Cape Cod, Martha's Vineyard, and Nantucket combined.

So what's holding it up? Although the farm will be located more than 5 miles away from the Cape Cod coast, the turbines will stand -- from blade tip to water's surface approximately 440 feet -- and the transmission lines connecting the project to the grid crosses land controlled by state and local authorities.

Among those who object to the project: Senator Ted Kennedy, who along with other residents, claims he will see the wind farm from his coastal complex. Some extreme environmental groups also object to the project, on the grounds that migratory bird and sea life patterns may be disrupted.

Supporters, among them even some green groups, posit that the benefits outweigh the losses, among them renewable energy, improved air quality, lower electricity bills, and added security and reliability for the Northeast power grid. And even Audubon has discounted the impact on birds.

A recent global wind mapping project may help guide where to site wind farms for maximum return in the future. But what happens when a Nantucket Sound or the St. Lawrence Seaway makes the top of the list?

That question is a complicated one, and it often involves some big, influential neighbors.

But the larger question is do we want to invest in alternative energy or do we want to continue to rely on foreign oil, domestic coal, and other polluting sources?

With oil flirting with $90, it seems imperative to put our objections to rest and start turning ill-winds into gains.

Global Climate Change: Coral Reefs Dying Faster Than Rainforests

New Scientist reports on a new study that show coral reefs in the Indo-Pacific are dying at a more rapid pace than rainforests. This isn't good news for us divers...

Coral reefs in the Indo-Pacific are disappearing twice as fast as tropical rainforests, say researchers. They have completed the first comprehensive survey of coral reefs in this region, which is home to 75% of the world's reefs.

John Bruno and Elizabeth Selig of the University of North Carolina at Chapel Hill in the US compiled data from 6000 studies that between them tracked the fate of 2600 reefs in the Indo-Pacific between 1968 and 2004. They used the extent to which reefs were covered by live coral as an indication of their health.

"The corals themselves build their limestone foundation, so if the surface of the reef is not covered with live tissue that is continually secreting it, the reef can erode fairly quickly," explains Selig.

She and Bruno found that coral cover declined by 1% per year on average between 1968 and 2004. For comparison, tropical rainforests declined by 0.4% per year between 1990 and 1997 (Science, vol 297 p 999).

Read the full story: Reefs on the Brink

Global Climate Change: A Vacation Odyssey, Will NC Beaches Be Gone?

Vacationing on the barrier islands off the coast of North Carolina, I'm always struck by the fragility of the landscape here and, indeed, the perseverance of the human communities along this chain of islands.

Now a new study called "Measuring the Impacts of Climate Change on North Carolina Coastal Resources," analyzes the impact of rising sea levels on property values, recreation and quality of life in coastal North Carolina.

The study was conducted by researchers from Appalachian State University, East Carolina University, University of North Carolina Wilmington and the Potsdam Institute for Climate Impact Research.

Their conclusion?

* North Carolina's coastal topography makes it especially vulnerable to sea level rise and hurricanes -- both economically and ecologically.

*The value of property at risk to sea-level rise in just four NC counties is US$6.9 million.

* A one- to three-foot rise in sea level along four North Carolina coastal counties could mean billions of dollars in private property losses over the next 75 years.

* Recreational fishing and beach trips also are vulnerable to increased erosion from sea level rise and hurricanes, resulting in potential loss of recreational and tourism benefits totalling US$3.9 billion.

* Business losses from hurricanes could increase by as much as US$157 million per storm event by 2080, potentially reaching US$1 bn per category 3 storm event.

All of this is sobering news for communities that derive their livelihoods in large part from an annual influx island visitors and second-home owners.

According to the study, by the year 2080, 14 of the 17 recreational swimming beaches in southern North Carolina could, without adaptation, erode all the way to the road, eliminating the possibility for beach recreation in those areas.

As the beach diminishes, lead author John Whitehead, a professor of economics at Appalachian State University, people will spend less time and money at the coast as a result of the lost recreational opportunities. Using economic models, Whitehead estimated the lost economic value for southern North Carolina beaches would total $3.9 billion over the next 75 years.

Meanwhile, coastal developers and private home communities are springing up in very unlikely places. Condos, golf courses, and resorts are popping up along the edges of coastal spits and dunes, and at least one development advertised its "deep water homes."

Deep water homes? Now there's a concept whose time may be coming. Scuba gear included.

In another curious development in a recent Coastal Living magazine: the state of Colorado advertized its charms to CL readers. Do they know something we don't know?

Read the full or summary reports: Measuring Impact NC