Construction, fuel jolt energy costs
Between high fuel prices and modernization efforts, utilities are feeling the squeeze and are beginning to pass those increased costs on to consumers. Jeff Tyler has the story.
Steam billows from the cooling towers at Exelon's nuclear power generating station in Byron, Ill. (Scott Olson/Getty Images)
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TEXT OF STORY
Kai Ryssdal: Whether or not the oil bubble that Mr. Greenberger and I were just talking about ever does pop, we're still going to be paying more for energy. Forget oil; think electricity.
Nationwide, power prices have risen an average of 30 percent over the past five years and they're spiking now. Utility customers in Virginia, for example, face another 29 percent jump next month.
Marketplace's Jeff Tyler reports now on the shocking rate of electricity inflation.
Jeff Tyler: About 70 percent of your electric bill covers the cost of fuel.
Coal is the cheapest, but it's getting more expensive as the U.S. exports more to China. More environmentally-friendly fuels have also become pricey, says Morningstar utilities analyst Paul Justice.
Paul Justice: Natural gas prices are up dramatically and natural gas, while it's clean burning relative to coal, it's also very expensive when it comes down to electricity generation.
Many utilities also are long past due for an infrastructure overhaul. The cost of building new power plants has doubled in the past eight years. That's partly due to skyrocketing prices for commodities.
Ed Legge is spokesman for the Edison Electric Institute, a trade association. He says utilities must make improvements to meet growing demand -- it's expected to increase by 30 percent over the next two decades.
Ed Legge: Because of the need to modernize the electrical grid and to make it more efficient, to build the infrastructure we need to continue providing electricity. All those things are going to add up to one of the biggest construction phase in our industry's history.
Legge says a likely federal cap on carbon emissions could drive utility prices even higher.
But there may be some relief from an unlikely source: electric cars.
Legge: Plug-in hybrids actually are one way that could give us a giant virtual battery.
Legge says some utilities eventually hope to borrow electricity from electric car batteries during peak energy hours. The cars would recharge at night, when demand is at its lowest.
I'm Jeff Tyler for Marketplace.
Comments
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From Jacksonville, FL, 06/17/2008
Why not just end the energy lie?
Marijuana can produce several different kinds of fuel. In the 1800's and 1900's hempseed oil was the primary source of fuel in the United States and was commonly used for lamps and other oil energy needs. The diesel engine was originally designed to run on marijuana oil because Rudolf Diesel assumed that it would be the most common fuel. Marijuana is also the most efficient plant for the production of methanol. It is estimated that, in one form or another, marijuana grown in the United States could provide up to ninety percent of the nation's entire energy needs.
Source: Schaffer Library of Drug Policy
Hemp is 4 times more efficient than corn as biofuel. Hemp pellets can be used to produce clean electricity.
... so powerful it could replace every type of fossil fuel energy product (oil, coal, and natural gas).
... This plant is the earth's number one biomass resource or fastest growing annual plant for agriculture on a worldwide basis, producing up to 14 tons per acre. This is the only biomass source available that is capable of producing all the energy needs of the U.S. and the world...
Hemp will produce cleaner air and reduce greenhouse gases. When biomass fuel burns, it produces CO2 (the major cause of the greenhouse effect), the same as fossil fuel; but during the growth cycle of the plant, photosynthesis removes as much CO2 from the air as burning the biomass adds, so hemp actually cleans the atmosphere. After the first cycle there is no further loading to the atmosphere...
Source: USA Hemp Museum
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From Woodland, CA, 06/16/2008
Green nuclear power is the only practical solution to (1) ameliorate global warming, (2) avoid dependence on foreign oil/gas, and (3) overcome oil/gas depletion. Only two prime energy sources, coal and uranium, can affordably deliver terawatts of "mother" electricity for: (A) heavy industry, i.e. manufacture of autos, ships, airplanes, etc; (B) power for vast fleets of future electric plug-in autos; and (C) production of portable synfuels (hydrogen and ammonia) and biofuels to replace oil. However coal worsens global warming and must be preserved as raw material to make organics when oil and gas are gone. This leaves uranium as the only "big-mama" green energy source, an "inconvenient truth".
Green solar and wind energy are useful for small-quantity power generation in select locations. But at terawatt levels, immense areas of land and/or sea would be needed, necessitating enormous maintenance operations, spoiling scenic land- or sea-scapes, and destroying local ecosystems. As scientifically documented in "The Nuclear Imperative" (ISBN 1-4020-4930-7), by 2050 only uranium and thorium can affordably sustain global energy needs for some 3000 years, using proven fuel reprocessing and advanced reactor technology. For the USA, 500 additional nuclear reactors are required, built on 9000 acres (@ $1.5 trillion), compared to 1,500,000 windmills with storage batteries on 6,000,000 windy acres (@ $4.5 trillion). Ten times these numbers are needed world-wide.
Contrary to false propaganda by anti-nuclear groups, the cost of tera-watts of electricity is three times less expensive with nuclear than for wind or solar. Solar and wind power generation requires expensive energy storage systems (batteries, etc) when there is no sunshine or wind. Also many miles of access roads for maintenance and repair are needed to keep blades or solar panels clean from bird droppings, dead birds, sand erosion, and storm damage, and to periodically replace electrodes on storage batteries. Should the USA limit itself to solar and wind energy, it is guaranteed to become impoverished and dependent on synfuels imported from other countries (future OPECs), who have nuclear power when oil fields are depleted.
A stale anti-nuclear cry is "what about all the long-lived radioactive nuclear waste". The volume of waste amounts to one aspirin tablet per year per person using nuclear electricity, compared to tons of air pollutants and globe-warming gaseous CO2 emitted by coal or fossil-fuel combustion. Nuclear waste can be easily stored and safely transported, as the US nuclear navy has done for half a century. Contrary to allegations that uranium and plutonium in spent fuel elements pose a problem because of million-year half-lives, they are separated from fission products by reprocessing and burnt as fuel in future fast-breeder reactors; they will not be dumped. This reduces 50,000 tons from ten-year accumulation of spent fuel to 500 tons of fission products, taking centuries instead of decades to fill the Yucca Mountain repository in Nevada. The notion that long radioactive lifetimes are undesirable is also erroneous. The longer the decay lifetime, the less the radiation emitted per gram of radio-isotope. All humans are "hot" because everyone has radioactive potassium-40 (K-40; 0.012% abundance) in his body, which continuously emits beta particles with a half-life of one million years! Man successfully evolved in this environment.
Energy is man's third most important need after water and food. Those who hinder expansion of nuclear power will be viewed as irresponsible neo-luddites by future generations. Any further delay of a committed US nuclear energy program will cause impoverishment and death of many US citizens by 2050. Those responsible will and must be held accountable for this. Originally the US had planned to have 300 reactors by the year 2000, but instead there are only 104 today. After the Three-Mile-Island (TMI) reactor meltdown in 1979 in the US (with 0 casualties) and Russia's Chernobyl accident in 1986 (with 57 fatalities), public hysteria fanned by fear-mongering antinuclear activists caused cancellations and moratoria on construction of new nuclear plants. While the USA was once the leader, most US businesses with reactor manufacturing know-how closed. Instead France, Russia, Japan, South-Korea, India, and China are now the leaders. Zealous anti-nuclear lobbyists and mal-informed federal and state governments have created the pending energy crisis. We are entering an energy-crisis period as serious as WW-II or Al-Qaida. Strong bipartisan Manhattan-Project-like leadership is needed to get the USA safely over the upcoming energy shortages.
Jeff Eerkens, PhD
Adjunct Research Professor
Nuclear Science& Eng'ng Institute
University of Missouri-Columbia
eerkensj@missouri.edu
From Baltimore, MD, 06/16/2008
This run-up has double whammy in those states that made the mistake of dergulating electricity. Not only do increased fuel prices drive up rates, but speculation, unusual special charges, and market manipulation amplify the increases in deregulated markets. See the recent FERC ruling vis PJM and Maryland. Rates in Maryland are almost 100 percent higher than they were under regulation. So much for the benefits of the market.
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