One senator trying to do something about oil speculation

[BanditVol]

http://finance.yahoo.com/blogs/daily-ticker/gas-prices-outrageously-high-sen-bernie-sanders-demands-183803867.html

The price of gas at the pump is outrageously high. Many people had thought this had something to do with supply and demand, that's not the case," Sen. Sanders tells me in the accompanying video. "It has everything to do with Wall Street speculation."

[SmokeyJoe]

Senator Sanders is a great, patriotic American.   

[BanditVol]

The funny thing about this is, an extremely right-wing friend of mine was blaming the prices back in 2008 on oil speculators and I kind of just kept looking at him funny.  It wasn't until 2009 that I found out about the oil being stored in tankers off-shore, in spite of the fact that I OWNED a tanker stock in 2008.

[3beans]

Get used to the high prices of all forms of energy.  Huge sums of money are being dumped in windmill schemes under the guise of 'green energy'.  Utilities are conning people into paying extra on their electric bills with the blessing and encouragement (even at the direction of) of the state and federal government.  In the mean time the large fossil and nuke plants are rapidly approaching their obsolescence date (the end dates for all nukes are written in stone and cannot be extended and the majority in this country are already into the 20 yr extension granted by the NRC).  These plants are not being replaced and most have about a 10 year construction cycle. 

'Smart Grid' tech is rapidly being rolled out under the guise of more efficient energy transfer (current transfer rates are between 97 and 98% efficient right now so how much can be gained?).  The secret about 'Smart Grid' tech is that it will allow the utilities to turn off your power at the source without your consent.  This allows the utility to shave peaks whenever they need to...which is great if you are a control room operator, but it sucks if you're trying to fix dinner.

AEP has announced the closure of 5 coal plants (they are the largest coal burning utility in the country).  TVA and the rest will follow suit.  I would suggest you get used to the steady drumbeat of 5 - 10% annual price increases because they are coming.  The libs in congress will rail loudly against the utilities for gouging the consumer but in private, they are the ones pushing hardest for these changes.  Why??? In the name of greenhouse gasses of course.  Global warming...Environmental reasons...Renewable energy in the form of General Electric wind turbines made in Germany(and you wonder if there is some corruption between Obama and Immelt...CEO of G.E. and chief energy advisor to the pres.)

Just FYI, the cheapest generating units are the nukes followed by the large coal units.  Large combine-cycle gas CT's are next followed by small coal units.  Then come the simple cycle gas units followed by the large oil burners.  Wind turbines are absent from the list since nobody has figure out how to price them yet. 

I just thought you would like to know.

[BanditVol]

Get used to the high prices of all forms of energy.  Huge sums of money are being dumped in windmill schemes

I understand what you are saying, but no one is being forced to do this, right?  Let the market take care of it.  We would be foolish to not even try.  For the record, I don't think there is anyway that wind could ever supply all our needs, but it could make a nice supplement.  Last time I checked, hydro was running around 8% and wind was getting close to 2%.  I think it might be reasonable for it to equal hydro or even more.

Utilities are conning people into paying extra on their electric bills

True, but if people want to donate to "green energy" let them.  I don't!

(the end dates for all nukes are written in stone and cannot be extended and the majority in this country are already into the 20 yr extension granted by the NRC).

I have not looked into this recently, but I have read in the past that many current plants could make it all the way to 2050.  There was some movement towards granting new licenses that was killed by the recent Japanese mess, but I expect that to fade in a couple of years and momentum to resume.  Of course, the problem with nukes is that they produce mass amounts of waste.

'Smart Grid' tech is rapidly being rolled out under the guise of more efficient energy transfer (current transfer rates are between 97 and 98% efficient right now so how much can be gained?).

I'm not sure I buy this completely.  I can see other advantages of the smart grid.  For instance, if you had a smart grid in your house it could zero out all the parasitic draws from things being left plugged in, turn off uneeded lights, etc.  

 

The secret about 'Smart Grid' tech is that it will allow the utilities to turn off your power at the source without your consent.  This allows the utility to shave peaks whenever they need to...

Really?  This sounds pretty strange.  Have you heard of this actually happening, or is this something someone with a tinfoil hat told you?

AEP has announced the closure of 5 coal plants (they are the largest coal burning utility in the country).  TVA and the rest will follow suit.

I have already heard that TVA is closing Widow's Creek coal plant.  They also want to finally open Bellefonte, a nuclear reactor near Scottsboro AL.  I don't know if the two are related or not.

 

I would suggest you get used to the steady drumbeat of 5 - 10% annual price increases because they are coming.

 

Given how many utilities are in my portfolio, I would make money on that.    And I have to say that since I am in the TVA area, I pay one of the lowest rates in the country already.  This will not bother me.  I am also unsure if it's even true, but not a concern for me.  

 Why??? In the name of greenhouse gasses of course.  Global warming...Environmental reasons...

I have a healthy dose of skepticism about global warming, but what I know for sure is that CO2 in the atmosphere is the highest it has been in at least 250,000 years and that it is directly correlated to industrial activity and transport.  Is it wise to just let it keep building up?

Renewable energy in the form of General Electric wind turbines made in Germany(and you wonder if there is some corruption between Obama and Immelt...CEO of G.E. and chief energy advisor to the pres.)

Just FYI, the cheapest generating units are the nukes followed by the large coal units.  Large combine-cycle gas CT's are next followed by small coal units.  Then come the simple cycle gas units followed by the large oil burners.

 

In operating costs yes, but it costs a lot to bring a nuke online to begin with due to all the regulations.  And then there is that pesky nuclear waste.  The French pay a lot extra to clean it up, but we have yet to commit to that approach.  Coal is very cheap.  So cheap that I think the market could figure out a way to dispose of the CO2 or at least a lot of it and keep coal a viable option.  We have very deep coal reserves.

Wind turbines are absent from the list since nobody has figure out how to price them yet.  

I priced them myself last year.  They are advertised as about $0.5-1 per KW to install.  Whether they are viable of course depends on the wind capacity of the area of the country you live in.  Most Eastern states are worthless, although TVA did install a whole bunch of wind turbines in the Cumberland Plateau last year.

[3beans]

I work on the front line of the industry.  I have a ringside seat.  If you want to disregard everything I said then you may.  It won't change any of the things I have stated.

All operating nukes since the 70's came on line with a 25 year operating license.  At the end of 25 years they may apply for a 20 year extension.  That is the absolute end of their lifetime.  The reactor vessels reach a point where they are no longer safe to operate due to a process called neutron embrittlement.  The last plant to come on line in the US was Watts Bar.  Most hit the line in the 70's and 80's. 

Do a cost analysis on just the cost of leasing the land for a wind turbine.  They eat huge swaths of land (usually owned by someone) that is leased on a monthly basis.  They require access roads to every installation along with electric infrastructure such as underground cable and transformers.  At the absolute minimum, the amount of land for a windmill has the circular radius equal to the height of the tower plus the blade (in case it falls).  Figure out the acreage of 150 meter tall windmill.  There is a wind farm in southern Ill. that covers 20,000 acres and the maximum output is 400 megawatts.  Then factor in the 'capacity factor' which is the actually percentage output that you get from the units.  Currently, these factors are running between 13 - 15%.  So you lease 20,000 acres, buy the turbines and towers, pay for the infrastructure and you end up with 400 x .15 = 60 megawatts.  The bottom line is these things never will pay for themselves.

Most new designs for nukes range from 500 - 1500 megawatts per unit and they have capacity factors of 80 - 90%.  Large coal plants also have about the same output range.  These units function very well on areas as small as a couple a hundred acres. 

Your investments in utilities is a smart one.  The dividends are very reliable and pretty hefty.  I invested a chunk in 2009 just for the divi.  The face value on the ones I bought have more than doubled since then so I'm pretty happy about that.  Still, it just kills me the way the energy policy is being driven by deception.  I can't blame the utilities because that have to dance to the tune the government plays if they want to stay in business.

Yes, smart grid is going to allow the cutting off of individual customers from a central location.  New meters are being installed that can be controlled by a signal sent from the operation center, to the substation, to the distribution circuit that feeds every customer.  Every meter has an address and will be able to receive individual instructions.  The occupation of meter reader is soon to be extinct because utilities can read you power usage remotely.  It's not rocket science and it is coming.  The utilities are not interested in turning off appliances that in your home...there's no reason to do so.  There are good reasons to be able to control the power down to this level.  Primarily, it allows the power company to avoid a system collapse should demand exceed supply and a system collapse is a disaster.  The grid is being knitted together more and more tightly and, while this helps reduce the chance of a collapse, when one occurs it will be on a much more massive scale than ever before.  You don't know how close we all came in the blackout of 03.

As far a CO2 goes, well, I consider it like rain.  It's a necessary component of every form of life on this planet.  It's not a pollutant.  We would die without it.  There is absolute evidence that the planet has gone through many rapid periods of heating and cooling.  The 'Little Ice Age' is the most recent.  The planet cooled several degrees in fewer than 100 years.  There were no power plants running at the time.  Before that time there were vineyards in Greenland.  That was a time when the planet was much warmer than it is today.  I believe that the changes were due to changes in the energy output of the sun.  I also believe that our sun varies it's output much more than we have been led to believe.  I think it is very foolish to invest so much wealth into something that is based on an idea that is far from being proven.  I think the old adage 'A fool and his money are soon parted' applies to our current situation.

I just want to try and do my part in telling folks what I have witnessed over the years.  It's up to every individual to make up their own minds.  People deserve to know what they are buying.

[BanditVol]

Well I know that your figures on nukes are accurate.  For instance, I own some Entergy stock, and Bernie Sanders who I praised at the start of this email is trying to get the Vermont Yankee nuclear plant shut down.  Vermont previously granted the license to extend for 20 years and now they are trying to revoke it.  Ironic, huh!  I like his stance on oil, but he may cost me money if he suceeds in shutting off the Yankee plant.  OTOH, he is truly representing the people of Vermont.  The plant is very unpopular in polls.  Having said that I hope he fails and it stays open, lol.

One thing you are missing though, is that they are NOT all online yet.  I have a friend who is really into nukes.  He used to work with me at NASA, but has moved on.  The short story is that NASA started a nuclear propulsion program back in 2003 or 2004, he got all fired up about it and started to get his MS from UTK remotely in Nuclear Engineering (UTK is a world leader in NE, of course, with Oak Ridge nearby).  He got really pissed when NASA  cancelled the nuclear program.  It was almost funny.  Towards the end he was almost literally muttering to himself like the "stapler guy" in Office Space, but I am getting off track.  He is actually a very bright guy. He has become known as one of the leading experts on thorium reactors.  His name is Kirk Sorenson.  YOu can google it and see for yourself.

Anyway, Kirk told me a year or so ago, right before he left NASA, that an overabundance of licenses was granted in the 70s and then the whole indusrty slowed down in the 80s.  So that for the last 25-30 years plants have continued to slowly come online based on really old licenses.  Not all of them are online yet.  A good example is Bellefonte, where I actually visited in 1986 wqhen I was a TVA contractor. I personally know someone moving from a nuclear plant in Georgia to Bellefonte. 

So when I say they can go to 2050 in some cases, I am talking about the ones that came online later. I can give exapmples easily.  All you have to do is look at nuclear capacity.  It cont9inued to grow after 1990.  That was because older LICENSED plants were slowly coming online.


What has not been done in quite some time is for any NEW LICNESES to be granted, and the old ones are finally running out.  I think the NRC was close to finally granting a new one last year, but I have not kept up with it.


Dont have time to respnd to the wind stuff.  Will try to get to that later, but my $1/KW was based soley on the windmill cost by itself.  No land, taxes, insurance or anything like that, just hardware.  More detail later.

[3beans]

Here you go.  Lots of info.  Watts Bar was the last to come on line.  1996.  That means the maximum life will take it to 2041 and if no new reactors are built, it will be the last.  Of the 104 reactors listed only about 95 are actually in operation.  Of those 95, only about 85 are online at any one time.  Most reactors come offline for refueling about every 18 months and an outage can last for 6 - 8 weeks.  Then they hit the line again.  Ramp up to full output in about 3 days (due to pauses to check chemistry levels for proper operation).  Then they just crank out the power, 24 hrs a day, 7 days a week, 365 days a year.  Please notice that the 104 number is the number of reactors, not the number of sites.  Browns Ferry has 3 of those reactors.  The number of sites that have these plants probably are in the 40's.  Think about that.  40 sites around the country provide 20% of the total power generation of the country.  It's quite amazing when you think about it.

http://www.nei.org/resourcesandstats/nuclear_statistics/usnuclearpowerplants/

As far a licensees go, there are several that a plant needs before it can go into operation and those are not open ended on the date.  All new plants will have to present themselves before the NRC and obtain an operating license before they go on line.  I doubt that any plants will become operational with the current administration.  In fact, I tried to wager our manager that I would be retired before any new plants hit the line.  That was 6 years ago and I figure I have at least another 6 - 10 years to go before I retire.  I still feel it is a very safe bet. 

[BanditVol]

2050 was a rough date...2041 is close enough.     My main point is that there will not be mass tailoff in nuclear any time soon.

New licenses should be granted IMO.  I believe that Bellefonte will come online.  I personally know someone moving from Georgia to work there and word has it that TVA is planning to close Widow's Creek.  You might know more about that than I though.

Getting back to the wind turbines, you can get the basic equipment for $1-2 per watt, which is not bad at all.

http://www.solardyne.com/windgenerators.html

That of course does not cover installation, land to put them on, and perhaps insurance.  With subsidies it's possible to perhaps turn a profit over time, I don't know. I have not really looked into it that much.  My area has low average wind speed and wind turbines are much harder to maintain IMO than solar panels.

I did seriously consider installing a solar panel on my property last year, but my plans got overtaken by other events. I may still consider it at some point.

[EmerilVOL]

2050 was a rough date...2041 is close enough.     My main point is that there will not be mass tailoff in nuclear any time soon.

New licenses should be granted IMO.  I believe that Bellefonte will come online.  I personally know someone moving from Georgia to work there and word has it that TVA is planning to close Widow's Creek.  You might know more about that than I though.

Getting back to the wind turbines, you can get the basic equipment for $1-2 per watt, which is not bad at all.

http://www.solardyne.com/windgenerators.html

That of course does not cover installation, land to put them on, and perhaps insurance.  With subsidies it's possible to perhaps turn a profit over time, I don't know. I have not really looked into it that much.  My area has low average wind speed and wind turbines are much harder to maintain IMO than solar panels.

I did seriously consider installing a solar panel on my property last year, but my plans got overtaken by other events. I may still consider it at some point.

There is one large thing that neither of you have mentioned or talked about and that is generation of power at the local level (ie at the consumer's place of residence or work)  This would eliminate quite a bit of the problems associated with electric power high tension lines, the interruption of service, losses on the grid therefore eliminating any need for a "smart grid", elimination of research efforts to develop super conductor long haul power lines to power the "smart grid", and lowering of the "carbon" footprint of large scale generation plants.  Major innovations would be needed to provide this "at the source" generation capability since wind power is not a viable alternative for localized generation.  The most comprehensive method of generating the power that each person would need at the source is a method called "fuel cell generation".  By developing an economical large scale fuel cell each residence could be supplied "at the source" with the power that the home requires and the "carbon" footprint is basically a zero sum quantity.  All that is required is a method to supply the base ingredients to enable the fuel cell to generate the power.  This can be accomplished using hydrogen as the basic ingredient.  There are some questions as to the viability of such a proposal, but in the long run it eleminates many of the problems that each of you have cited.

[3beans]

As always there are few flies in the  ointment as far a fuel cells go.  First, I do believe that the catalytic process requires 'rare earth elements' in their construction.  These elements are aptly named and will sky rocket in price as they become more and more in demand.  Second, the only viable source of hydrogen comes from fossil fuels so the amount of carbon released would be unaffected.  You would also be introducing another conversion process into the product line that will require more energy.  From the 3 laws of thermodynamics you have the fact there will be losses anytime you convert energy from one form to another.  The extra process of converting natural gas to hydrogen would consume most of your savings.  Thirdly, there is no infrastructure for the delivery of H2 to the customer.   That alone would take more than a generation to accomplish.  Research is a good thing and yields good ideas and I'm all for it...but right now there are no good prospects of seeing wide spread use of fuel cells.

[PirateVOL]

Senator Sanders is a great, patriotic American.   

you do like your fellow socialists don't you

[PirateVOL]

http://finance.yahoo.com/blogs/daily-ticker/gas-prices-outrageously-high-sen-bernie-sanders-demands-183803867.html

The price of gas at the pump is outrageously high. Many people had thought this had something to do with supply and demand, that's not the case," Sen. Sanders tells me in the accompanying video. "It has everything to do with Wall Street speculation."

too bad the socialist doesn't have a fizzleING clue how the markets work

A more basic misconception in Washington involves what these so-called speculators are really buying. They're not buying oil, they're buying futures, and this is a crucial distinction. A futures contract is an agreement between a buyer and a seller to deliver a set amount of oil - typically 1,000 barrels - at a specific price on a specific date. The value of that contract rises and falls, depending upon market conditions, right up until the date of delivery.

Thing is, the pension funds, index funds, hedge funds and other so-called speculators almost never take delivery of any oil. The typical investment fund will buy, say, the August oil future and then sell it days before it comes due - typically rolling over the proceeds into the next month's contract.

"For speculators to be propping up the price of oil, they somehow have to be taking physical oil off the market," says energy markets expert Craig Pirrong, a finance professor at the University of Houston's Bauer College of Business.

You might ask, are they?  Why no they are NOT!
According to the Department of Energy, U.S. oil inventories are now at below-average levels. U.S. oil stocks stand at 309 million barrels, versus 330 million in June 2005.
New York Mercantile Exchange Chairman James Newsome says "the percentage of futures contracts held by speculators (as opposed to commercial traders) "actually decreased over the last year," (in testimony to Congress)