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What do family ties have to do with E85?

Andrews2Going through scrapbooks last night brought back memories concerning my uncle, Billy Swanson (his performing name, given name William Sneirson). He was one of my favorites. He led a band during the late thirties and early forties that for a short time worked with a group called the Andrews Sisters.

Somewhere in my family archives, I have been told that we have cancelled checks for $100 for each of the three sisters. Pretty pricey in those days. My uncle and the Andrews Sisters played at the Hotel Edison in New York City. Soon after my uncle and the Andrews Sisters parted ways, the sisters recorded a song called “Bei Mir Bist Du Schoen,” written by Sammy Cahn and others. As many in the AARP know, the record sold millions and was recorded subsequently by many many singers. It is now almost an American music icon.

I couldn’t get the music out of my mind and have hummed it all day long while thinking about my day job trying to convince Americans to wean themselves off of gasoline on to alternative fuels. As President Obama has said, moving on to alternative fuels (like E85) would be good for the environment, the economy, reduce GHG emissions, and lower costs to consumers. Thinking and humming … I tried a rewrite of the lyrics to “Bei Mir Bist Du Schoen (translated from the Yiddish, the title means “To Me You’re Beautiful” … here are the lyrics.) Sorry, Sammy … sorry Patty, Laverne and Maxine. Please forgive, and I hope that you understand. Paraphrasing a former Secretary of Defense, what’s good for “Bei Mir Bist Du Schoen” is good for America. … Bring it on, Johnny Mathis.

(Please, if you remember, sing to the tune of “Bei Mir Bist Du Schoen”)

Of all the gas stations, I’ve known and I’ve known some
Until I first met you I was lonesome
And when you came in sight, dear, my heart and mind grew light
And this old world seemed new to me

You’re really swell, I have to admit you
Deserve expressions that really fit you
And so I’ve racked my brain hoping to explain
All the things that you do for flex-fuel vehicles and me and you

Bei mir bist du schön, please let me explain
‘Bei mir bist du schön’ means you’re grand
Bei mir bist du schön, again I’ll explain
It means you’re the fairest gas station in the land

I could say ‘bella, bella’ even ‘sehr wunderbar’
Each language only helps me tell you how grand you are
I’ve tried to explain, ‘bei mir bist du schön’
Please continue doing what you’re doing for America and say you understand

Bei mir bist du schön
You’ve heard it all before but let me try to explain
‘Bei mir bist du schön’ means that selling E 85 is grand
‘Bei mir bist du schön,’ it’s such an old refrain
And I again should explain, it means you r doing good for our air and land.

I could say ‘bella, bella’ even ‘sehr wunderbar’
Each language only helps me tell you how grand you are
I’ve tried to explain ‘bei mir bist du schn’
And I should  conclude by saying  thanks for lower fuel prices and say that you l understand!

The calls are already coming in. Maybe I will do it for Motown!

 

The Saudis and oil prices — the diminishing value of conspiracy theories

saudi_1880139cEveryone likes hidden conspiracies, either fact or fiction. Covert conspiracies are the stuff of great and not-so-great novels. Whether true or false, when believed, they often cause tectonic policy shifts, wars, terrorism and ugly behavior by groups and individuals. They are part of being human and sometimes reflect the inhumanity of men and women toward their fellow human beings.

I have been following the recent media attention on conspiracies concerning oil, gasoline and Saudi Arabia. They are all over the place. If foolish consistency is the “hobgoblin of little minds” (Ralph Waldo Emerson), then the reporters and editorial writers are supportive stringers for inconsistency. Let me briefly summarize the thoughts and counter thoughts of some of the reported conspiracy theorists and practitioners:

  1. The Saudis are refusing to limit production and raise the price of oil because they want to severely weaken the economy of Iran. The tension between the two nations has increased and, to some extent, is now being framed both by real politics (concerning who’s going to carry the big stick in the region) and by sectarianism. Iran’s oil remains under sanction and the Saudis hope (and may even be working with Israel, at least in a back-office way) to keep it that way.
  2. No, you’re wrong. The Saudis are now after market penetration and are lowering the price of oil to impede U.S. development and production of oil from shale. Right now, they are not worrying so much about oil from Iran-given sanctions…but they probably will, if there is a nuclear deal between the West and Iran.
  3. You both are nuts. The Saudis and the U.S. government are working together to blunt Russian oil sales and its economy. The U.S. and Saudis can withstand low oil prices, but the Russians are, and will be, significantly hurt economically. If it hurts Iran so much, the better! But the Cold War is back and the reset is a failure.
  4. Everyone is missing the boat. The Saudis don’t really control prices or production to the extent that they did in the past. Neither does OPEC. Don’t look for conspiracies, except perhaps within the Kingdom itself. The most powerful members of the Saudi royal family understand that if they limit production to raise prices per barrel, it probably wouldn’t work in a major way. The U.S. has become a behemoth concerning oil from shale. If a nuclear deal goes through, Iran will have sanctions lessoned or removed relatively soon. Should the Russian and West reach some sort of cold peace in Ukraine, Russia will become a player again. When you add Canada, Iraq, Libya and the Gulf States to the mix, lower global demand, and increase the value of the dollar, you get an uncertain oil future. The Saudis, led by their new king, are buying time and casing out their oil future.

To me, the Saudi decisions and the subsequent OPEC decisions were muddled through. Yet, they appear reasonably rational. Saudi leaders feared rising prices and less oil production. Their opportunity costing, likely, went something like this: “If we raise prices, and reduce production, we will lose global market share and maybe, in the current market, even dollar or riyal value. Our production costs are relatively low, compared to shale development in the U.S. While costs may go higher in the future, particularly once drilling on flat desert land becomes more difficult in light of geology, we can make a profit at the present time, even at $30-40 a barrel. Conversely, we believe that for the time being, U.S. shale developers cannot make a profit going below $40-50. Maybe we are wrong, but if we are, our cost/profit equation is not wrong by much. By doing what we are doing, we will undercut American production. Sure, other exporting countries, including our allies in the Gulf will be hurt temporarily, but, in the long run, they and we will be better off. Further, restricting production and assumedly securing higher prices is not a compelling approach. It could cause political and social tension in the country. We rely on oil sales, cash flow and profit as well as reserves to, in effect, buy at least short-term civic peace from our citizens. Oil revenue helps support social services and basic infrastructure. We’ve got to keep it coming.”

The Kingdom understands that it can no longer control prices through production — influence, yes, but, with the rise of U.S. oil development, it cannot control production. Conspiracy theories or assumed practices don’t add much to the analysis of Saudi behavior concerning their cherished oil resources. Like a steamy novel, they fill our reading time, and sometimes lead to a rise in personal adrenaline. Often, at different moments, they define the bad guys vs. the good guys, or Taylor Swift vs. Madonna.

No single nation will probably have the power once held by OPEC and the Saudis. While human and institutional frailties and desires for wealth and power suggest there always will be conspiratorial practices aimed at influencing international prices of oil and international power relationships, their relevance and impact will diminish significantly. Their net effect will become apparent, mostly with respect to regional and local environments, like Yemen and ISIS in Syria and Iraq.

Recently, I asked a Special Forces officer, “Why is the U.S. fighting in Iraq?” I expected him to recite the speeches of politicians — you know, the ones about democracy, freedom and a better life for the citizens of Iraq. But he articulated none of these. He said one word, “Oil”! All the rest is B.S. I think he was and remains mostly right. His answer might help us understand part of the reason for the strange alliance between the Saudis and U.S. military efforts in or near Yemen at the present time. Beyond religious hatred and regional power struggles, it might also help us comprehend at least part of the reasons for Iran’s support of the U.S.-led war against ISIS — a war that also involves other “democratic” friends of the U.S. such as the Saudis and the Gulf States.

The alliances involve bitter enemies. On the surface, they seem somewhat mystifying. Sure, complex sectarian and power issues are involved, and the enemies of my enemies can sometimes become, in these two cases, less than transparent friends. But you know, these two conflicts — Yemen and ISIS — I believe, also reflect the combatant’s interest in oil and keeping oil-shipping routes open.

President Obama has argued that we should use alternative energy sources to fuel America’s economy and he has stated that we need to wean the U.S. off of oil and gasoline. Doing both, if successful, would be good for the environment, and limit the need to send our military to protect oil lifelines. Similarly, opening up U.S. fuel markets to alternative fuels and competition would mute the U.S. military intervention gene, while curing us, to a large degree, of mistakenly granting conspiracy advocates much respectability. Oh, I forgot to indicate that the oil companies continue their secret meetings. Their agenda is to frustrate the evolution of open fuel markets and consumer choices concerning fuel at the pump. Back to the conspiracy drawing boards! Nothing is what it seems, is it?

 

Photo credit: http://blogs.telegraph.co.uk/finance/

President Obama, DOE boost alternate fuels

President Obama burnished his legacy as an environmentalist last week by mandating a huge cut in greenhouse gas emissions among federal vehicles. The aim is to cut emissions for 40 percent by the year 2025.

The executive order will increase the percentage of the government’s 636,000 vehicles that run on alternative fuels. Improved gas mileage on new internal combustion engines can account for only a small fraction of the required reduction, so the only alternative will be to increase the number of non-gasoline engines in the fleet. Among the frontrunners will be cars running on compressed natural gas, electric vehicles, propane-powered cars, vehicles running on gasoline-ethanol combinations, hydrogen vehicles, and all manner of hybrid combinations of any of the above Obama’s order built on a previous executive action in 2009 that has helped reduce greenhouse-gas emissions by 17 percent. The 40 percent reduction will be measured against levels in 2008, right before Obama took office.

As of 2013, more than 200,000 of the federal fleet of 635,748 vehicles were alternative-fuel vehicles. The most common of these were the 180,000 cars running on an ethanol-gasoline mix. But the new cars are expected to be of the more experimental variety. It is anticipated that, by 2025, half the federal vehicles will be some kind of plug-in hybrid.

The White House pointed to the efforts of large private companies such as IBM, GE, Honeywell and Walmart in meeting the same standards of switching to alternative vehicles in their fleet. The president’s spokespeople said the combined effort would be “the equivalent of taking nearly 5.5 million cars off the road.”

The president’s order was not the only effort by the federal government to increase its fleet of alternative vehicles. The Department of Energy announced a $6 million program to accelerate the alternative vehicle market. DOE said the purpose of the grants will be to get people accustomed to the idea of driving alternative vehicles. Eleven projects will be funded around the country. They will include:

  • Clean Fuels Ohio will sponsor the Midwest DRIVES initiative to make alternative fuel vehicles available to select company fleets on a short-term lease basis. The program will used data collected from these experiments to encourage other companies to lease AFVs as well.
  • Penske Truck Leasing of Reading, Pennsylvania, will make compressed natural gas heavy-duty trucks available to cross-country truck fleets on a 1-to-3-month basis. The object will be to test consumer satisfaction.
  • The Florida Office of Consumer Services, Office of Energy, will make available plug-in hybrid vehicles to car rental companies in the Orlando area. With Disney World at its doorstep, Orlando is the nation’s largest car-rental market. The idea will be to accustom renters to the advantages of plug-in hybrids.
  • The Triangle Council of Governments around Research Triangle Park will supply vehicles powered by CNG, electricity, propane, E85 and biodiesel over a three-state area that will include North Carolina, South Carolina and Tennessee. The object will be to encourage fleet purchases.
  • The Plug-In Hybrid Electric Vehicle Demonstration Program, run by ASG Renaissance of Dearborn, Michigan, will attempt to stimulate consumer awareness and demand for PHEVs by placing them in the hands of media influencers. It is hoped that a social media campaign through Facebook and Twitter will bring positive coverage.
  • The West Virginia University Research Corporation will develop a curriculum for training promoters and repair specialists for alternative vehicles. The National Alternatives Fuels Training Consortium will provide marketing and outreach for the new curriculum.
  • The National Fire Protection Association of Quincy, Massachusetts, will develop curricula for the use of alternative vehicles in fire protection, emergency services and first responders to auto accidents.
  • The North Central Texas Council of Governments will develop a curriculum for use of propane, electric and natural gas vehicles for fire marshals, code officials, mechanics and technicians, and first responders. The program will be offered in four states of the Southwest.
  • The University of Central Florida will establish a training program for the use of CNG, electric and propane vehicles by first responders, college instructors, tow-truck operators and salvage/recycling vehicles. Hands-on training will be supported by vehicles supplied the National Association of Fleet Managers.
  • The Metropolitan Energy Center of Kansas City will collaborate with State Fire & Rescue Training institutes in Kansas and Missouri to adapt existing alternative fuel safety curricula to their existing training structures.
  • The National Association of State Energy Officials will work with its network of State Energy Offices, the National Governors Association, and the International Emergency Managers Association to help incorporate alternative fuel and advanced vehicles into multiple emergency preparedness plans.

So there’s plenty going on in the advance of alternative vehicles. It will take more than a drop in the price of oil to discourage these programs.

(Photo: POET LLC)

Democrats block Keystone XL bill in Senate

As expected, Senate Democrats prevented a bill authorizing construction of TransCanada’s Keystone XL pipeline from advancing in the Senate.

The fate of the pipeline still remains with the State Department, because the pipeline would cross from Canada through the United States.

President Obama already has made his feelings known, saying through a spokesman that he would veto any bill that emerged from Congress.

According to media reports, Senate Majority Leader Mitch McConnell moved to end debate on the bill, a version of which had already cleared the Republican-controlled House. But Republicans could only muster 53 votes for cloture, or an end to the debate, on two separate roll calls. Under parliamentary rules, 60 votes are needed for cloture.

The New York Times reported: “The move ensures that senators will continue to debate the bill — most likely for another week — before Republicans again try to bring the measure up for a final vote.”

The GOP had no doubt hoped for more Democrats. As Politico reported:

The legislation … on Monday lost a vote from one of its longtime backers, Sen. Jon Tester (D-Mont.) — now a member of party leadership as chief of the Democratic Senatorial Campaign Committee — but picked up a vote from Sen. Michael Bennet (D-Colo.), the former DSCC chairman who has not formally signed onto the pipeline bill.

Two other Democrats who have backed stripping Obama’s power to decide on a Keystone permit, Sens. Claire McCaskill and Mark Warner, missed the Monday vote.

“I’d like to see us decide Keystone and move on,” Sen. Heidi Heitkamp, one of the pro-Keystone Democrats who voted with the GOP to cut off debate, told reporters.

Keystone’s backers initially expected the pipeline votes would end this week. But Democratic anger over the majority leader’s move to close off the debate on their amendments last week has made the pipeline bill a power struggle, with Democrats pushing McConnell to continue the freewheeling energy debate on the floor that has delved into topics ranging from climate change to eminent domain.

 

GOP condemns White House proposal to add Alaska protections

Reaction is pouring in after President Obama over the weekend announced his administration was seeking to permanently protect the majority of the Alaskan National Wildlife Refuge — about 12 million of 19.8 million acres — from oil and gas exploration.

The coastal plain in the refuge, home to about 200 species, as well as an estimated 10.3 billion barrels of oil (enough to satisfy U.S. consumption for about 18 months), has been “off-limits to development for years,” The Los Angeles Times writes. But:

… the White House move marks a new front in the long-running political and environmental battle over whether to authorize oil production in the refuge.

Only Congress can designate the area as protected wilderness. But even if lawmakers don’t support the measure, officials said, the Interior Department intends to continue barring oil and gas development — along with road-building and almost every other form of development.

As The Washington Post put it:

The move marks the latest instance of Obama’s aggressive use of executive authority to advance his top policy priorities. While only Congress can create a wilderness area, once the federal government identifies a place for that designation, it receives the highest level of protection until Congress acts or a future administration adopts a different approach.

Obama, in a video released Sunday, said: “Alaska’s National Wildlife Refuge is an incredible place — pristine, undisturbed. It supports caribou and polar bears, all manner of marine life, countless species of birds and fish, and for centuries it supported many Alaska Native communities. But it’s very fragile.”

Environmentalists praised the announcement, but Republican lawmakers weren’t happy, particularly Alaska Sen. Lisa Murkowski, who leads the Senate Energy and Natural Resources Committee. A statement on the senator’s website was titled “Obama, Jewell Declaring War on Alaska’s Future,” referring to Interior Secretary Sally Jewell.

Murkowski said:

“What’s coming is a stunning attack on our sovereignty and our ability to develop a strong economy that allows us, our children and our grandchildren to thrive. It’s clear this administration does not care about us, and sees us as nothing but a territory. The promises made to us at statehood, and since then, mean absolutely nothing to them. I cannot understand why this administration is willing to negotiate with Iran, but not Alaska. But we will not be run over like this. We will fight back with every resource at our disposal.”

The White House called her reaction overblown.

 

Obama mentions oil, Keystone in State of the Union

President Obama touched on several aspects of the energy debate during Tuesday night’s State of the Union Address, including:

Imported oil:

More of our kids are graduating than ever before; more of our people are insured than ever before; we are as free from the grip of foreign oil as we’ve been in almost 30 years.

Ramped-up U.S. oil production:

At this moment — with a growing economy, shrinking deficits, bustling industry, and booming energy production — we have risen from recession freer to write our own future than any other nation on Earth.

Consumers savings from cheap gasoline:

We believed we could reduce our dependence on foreign oil and protect our planet. And today, America is number one in oil and gas. America is number one in wind power. Every three weeks, we bring online as much solar power as we did in all of 2008. And thanks to lower gas prices and higher fuel standards, the typical family this year should save $750 at the pump.

The debate over the TransCanada Keystone XL pipeline:

21st century businesses need 21st century infrastructure — modern ports, stronger bridges, faster trains and the fastest internet. Democrats and Republicans used to agree on this. So let’s set our sights higher than a single oil pipeline. Let’s pass a bipartisan infrastructure plan that could create more than thirty times as many jobs per year, and make this country stronger for decades to come.

And something else about solar power:

I want Americans to win the race for the kinds of discoveries that unleash new jobs — converting sunlight into liquid fuel …

As The New Republic noted, it was the first time in his six SOTU Addresses that Obama mentioned Keystone:

It’s not surprising he’d weigh in now, given how Keystone has dominated the first few weeks of debate in the new Republican Congress. Lately, Obama has sounded skeptical of the pipeline’s economic benefits, but we still don’t have many clues as to how he will decide Keystone’s final fate in coming months.

(Photo: WhiteHouse.gov)

Obama aims to cut methane emissions 45 percent

President Obama’s latest effort to mitigate the effects of climate change will be to crack down on methane leakage from oil and gas wells, The New York Times reported.

The EPA will announce new regulations this week aimed at reducing methane emissions by 45 percent by 2025, compared with 2012 levels. Final rules will be set by 2016, the newspaper reported, citing anonymous sources.

Obama, stymied by Republican opposition that stands to become more solidified now that the party controls the Senate as well as the House, has increasingly turned to executive action, skirting Congress, to deal with climate change. The administration says the Clean Air Act gives it the green light to issue such mandates.

Methane, the primary component of natural gas, sometimes escapes from oil and gas wells, in addition to pipelines. Although the gas accounts for only 9 percent of overall greenhouse-gas emissions, it’s 20 times more potent than carbon dioxide, another GHG that accounts for the majority of emissions.

The Natural Resources Defense Council applauded the proposed regulations, but the oil and gas industry said they’re unnecessary, since they’re already motivated to capture methane instead of allowing it to escape into the atmosphere. If it’s captured, it can be burned in power plants to generate electricity, making it a cleaner alternative to coal. Methane can also be used to fuel cars and trucks, as compressed (CNG) or liquefied (LNG) natural gas. It can also be converted into two types of inexpensive liquid alcohol fuels, ethanol or methanol.

Howard Feldman, director of regulatory affairs for the American Petroleum Institute, said:

“We don’t need regulation to capture it, because we are incentivized to do it. We want to bring it to market.”

That market would grow if the infrastructure for transportation fuels were expanded, creating more of an incentive to capture methane. The price of natural gas stood at $12.68 per million metric British Thermal Units (MmBTU) in June 2008, only to crash to $1.95 by April 2012. Last month the average was $3.43 at the Henry Hub terminal in Louisiana. Profit margins are still so low that oil drillers flare off much of it.

Obama, Congress draw battle lines on Keystone XL

On the same day two Republican senators introduced a bill authorizing construction of the Keystone XL oil-pipeline extension, the White House said President Obama would veto such a bill if it reached his desk.

“If this bill passes this Congress, the president wouldn’t sign it,” White House press secretary Josh Earnest said Tuesday.

Republicans took over control of the Senate as the 114th Congress was sworn in Tuesday. The GOP, and some Democrats, have supported the pipeline project for much of the past six years that it’s been in limbo, and the party wasted no time in sponsoring a bill to pressure the Obama administration to approve it: Sens. Joe Manchin, Democrat of West Virginia, and John Hoeven, Republican of North Dakota, introduced the Senate bill, and a committee hearing is scheduled for Wednesday.

The House is expected to begin deliberations on its own Keystone bill on Friday.

The last time the House passed an authorization, in November, it was blocked from proceeding by Senate Democrats. But with fewer numbers, the measure has a greater chance of passing this time.

However, the Senate needs 67 votes — two-thirds — to override a presidential veto. As BusinessWeek reported, Hoeven says he has 63 votes in favor of approval, four shy of a veto-proof majority.

Reaction to the White House announcement ran the gamut. House Speaker John Boehner, Republican of Ohio, said in a statement:

On a bipartisan basis, the American people overwhelmingly support building the Keystone XL pipeline. After years of manufacturing every possible excuse, today President Obama was finally straight with them about where he truly stands. His answer is no to more American infrastructure, no to more American energy, and no to more American jobs.

By contrast, environmental activist Bill McKibben, writing in The Guardian, praised the effort that led to the veto threat, considering the pipeline once was considered a shoo-in for approval.

Keystone’s not dead yet – feckless Democrats in the Congress could make some kind of deal later this month or later this year, and the president could still yield down the road to the endlessly corrupt State Department bureaucracy that continues to push the pipeline – but it’s pretty amazing to see what happens when people organize.

The State Department has concluded that the 1,179-mile pipeline extension, which would carry oil-sands crude from western Canada to the Gulf of Mexico, wouldn’t significantly add to carbon emissions, but the project would create only 35 permanent U.S. jobs.

Regardless of what happens between Congress and Obama, the final decision on Keystone rests with the State Department, which reports to the president. State has responsibility because the pipeline, to be built by TransCanada Corp., would cross the Canada-U.S. border.

The Post added:

“I think the president has been pretty clear that he does not think that circumventing a well-established process for evaluating these projects is … the right thing for Congress to do,” Earnest said.

Obama rejected a Canadian firm’s application to build the pipeline in 2012.

At a year-end news conference in December, Obama sought to downplay the benefits of the pipeline. He said the benefits for U.S. citizens and workers from the pipeline would be “nominal.”

“I think that there’s been this tendency to really hype this thing as some magic formula to what ails the U.S. economy,” Obama said.