Making money from the Greening

We’re mostly still just trying to do that, as if there’s a first, as if THAT’s the opportunity:

Sustainable investing is one of the hottest trends on Wall Street. Trillions of dollars are rushing in as consulting firms and private foundations spread the gospel. But no one is entirely sure what ESG is beyond the literal (environmental, social and governance) or exactly how to define it. Metrics are self-reported and often hard to measure, tracking everything from carbon emissions to boardroom diversity. Greenwashing is a perennial concern.

Profits, however, are very much measurable. Bloomberg’s fourth annual ranking found that the biggest ESG funds are beating the market. If you do happen to have $1 million to spare and a soft spot for the future of planet Earth, here are some investment ideas for you. How does the intersection of AI, blockchain and climate sound?

We also reported this week on emerging technology such as carbon capture, and less environmentally damaging rocket launches. While not as sexy as spaceships, dirt is also important to the future health of the planet. Global agriculture has come to rely on annual crops and heavy fertilizer use, which inhibit soil’s ability to sequester carbon

So we’ll call it ESG or whatever, and we do. Predictions about how this will affect THAT, about where to place your future-of-energy bets is till going to lead to many near-term flareups and dead-ends. Reckoning with the ultimate dead-end may not be appealing, prospectus-wise, but acknowledging that we’re doing it anyway, that doing it the old way got us right to here, is the thing we will always still need to do until we do it.

Waiting. Adaptability Funds are going to scare the investor class for about one-half of a news cycle.

Peak Demand?

Mount_McKinley_and_DenaliRemember PEAK OIl? I wrote about it many times, and heard about it even oftener. It seems the great malevolent equalizer that would be a de facto end to eh way we had run things for 100 years. What happened?

In summer 2014, Citigroup’s Edward Morse noticed that Saudi Arabia was offering its oil at lower prices than usual. Others reported the same, and it was inferred that, as OPEC’s leader, Saudi Arabia was suddenly out to push down the global price. And that is where it went—inexorably down. It was not clear how low it could go, although Morse had been forecasting for some time that it would average in the range of $65 to $80 a barrel by the end of the decade; now the plunge he foresaw seemed to be coming much, much sooner.
In effect, the Saudis had declared war on US shale. Then, in November 2014, the situation bode worse for the US-produced oil: The Saudis, meeting with fellow OPEC cartel members in Vienna, declared that US and other non-OPEC oil had to be driven out of the marketplace—the cartel as a whole had to go on a war footing. So it was that, led by the Saudis, OPEC, along with Russia, flooded the market with oil, leading prices to as low as $27 a barrel in January, a 77% drop from their peak in June 2014.

At least that. The pressure from renewables that would have seemed a pipe dream in 2004 has already mutated into something even stronger and perhaps more positive, as the technology cheapens individual investments in solar and wind. An enormous reckoning remains on the issue how far you live from work, groceries and schools, the 20-to-30-minute-drive-each-way on which our society and many of its problems are based. The fact that people didn’t see this coming, and that the Saudi’s are willing to sink the entire enterprise to stop shale oil should be instructional. How much of the environmental assessment from 2004 remains operable is an interesting point to ponder.

The Frenetic End of Oil

General Economic Imagery From North Dakota Ahead Of The Republican CaucusParis talks but clean energy patents fly, it seems.  This Bloomberg feature on the boom and bust of the Bakken oil fields of North Dakota has the look of a high speed news reel that is, maybe, not quite how we imagined it. But once the process shows itself from beginning to end so quickly in this way, you can imagine happening over and over again. The pollution, the waste, the overbuilding, the exodus:

The discovery last decade that fossil fuels could be tapped from deep beneath the windswept prairies of North Dakota acted like a magnet on American working people. By the thousands they came, from as far as Texas and California, fortune-seekers in a modern-day Gold Rush. Together with visionary companies like Continental Resources and industry behemoths ExxonMobil and Norway’s Statoil, they exploited a new technology called fracking — blasting the underground Bakken rock formation with sand and water and slurping up the crude that was hiding there for millennia — to increase oil output in the region 12-fold from 2006 to 2014. The bonanza helped drive the U.S. closer to energy self-sufficiency than it’s been since the 1980s.

The frenzied production exacted a price — oversupply was one reason the U.S. crude price took a nosedive, losing more than half its value from a June 2014 peak. The number of rigs pumping crude from the Bakken plummeted to about 70 from a high of 200, and the tide of workers began to ebb.

Meanwhile, clean energy patents are at their all time high, which may also be a frenzied if inelegant prologue to the next age that is also not as previously imagined. In what remains of the capitalist economy, money still rushes in first, not pretty, sometimes not even choosy. But at least we can be a little more sanguine about what’s left to choose from, that the new ideas are exploding with quiet steam instead of smokey emissions, that maybe growth now will be slow and visible like the gentle oscillation of giant windmills. I know, poetry is sometimes like the explicit sunset in the image: not sure whether it’s rising or setting unless we understand the direction we’re facing.

 Image: David Acker/Bloomberg, fishing in the frozen Missouri River.

Green Opposition

Keystone-PipelineIt is enough to say that economics and environmental opposition have made building the Keystone XL Pipeline impractical. What this outcome may portend for the fates of other fossil fuels as the economics change may bare a little more fleshing out:

The company behind the Keystone XL pipeline has asked the US government to put its review of the controversial project on hold.

TransCanada says the pause is necessary while it negotiates with Nebraska over the pipeline’s route through the state.

The move came as a surprise as TransCanada executives have pushed hard to get approval.

Environmental groups oppose the 1,179-mile (1,897km) pipeline, saying it will increase greenhouse gas emissions.

Maybe they’re pulling it until President Carson can approve the travesty project. But perhaps the reckoning is that neither version of green opposition is sufficient to turn the tide against an legacy energy source – that the power of both and maybe every meaning of green is necessary to make the difference

Capacity Factor

That’s the percentage of a power plant’s maximum potential actually achieved over time. And Bloomberg reports that wide spread adoption of renewables is lowering the hitherto incomparable capacity factor for fossil fuels. This begins the virtuous cycle.


That’s because once a solar or wind project is built, the marginal cost of the electricity it produces is pretty much zero—free electricity—while coal and gas plants require more fuel for every new watt produced. If you’re a power company with a choice, you choose the free stuff every time.

It’s a self-reinforcing cycle. As more renewables are installed, coal and natural gas plants are used less. As coal and gas are used less, the cost of using them to generate electricity goes up. As the cost of coal and gas power rises, more renewables will be installed.

Again, no use getting all Pollyannish about any of this. But the business news only reports the business view and it doesn’t really care if renewables are more profitable than fossil. Business only cares about that middle part – the profit.

So, BFD.

Image: author photo, near Valreas, France.

Earth Overshoot Day

Let’s keep track of these things, shall we?foot_print_hr

On this day in August 2015, humans have used an entire year’s worth of the Earth’s natural resources, according to the Global Footprint Network.

Calling it Earth Overshoot Day, the group celebrates — or, rather, notes — the day by which people have used more natural resources, such as fish stocks, timber, and even carbon emissions, than the Earth can regenerate in a single year. It’s basically a balance sheet for global accounting.

“We can overuse nature quite easily,” Mathis Wackernagel, president of the Global Footprint Network, told ThinkProgress. “When you start to spend more than you earn, it does not become immediately apparent. But, eventually, you go bankrupt.”

How many Earths would it take… it seems as though the personal responsibility zealots among us would key into this logic, except for the great climate change hoax, which of course has nothing to do whatsoever, nosiree, with our  collective and per capita energy consumption. It is an interesting proposition: Four months left to go in the year, two of them likely pretty frosty for most people, and we’re out of gas everything?

Natural racehorses, indeed.

Frickin’ Fracking

Via Juan Cole, Michael Klare at Tomdispatch on The Third Carbon Age:

When it comes to energy and economics in the climate-change era, nothing is what it seems.  Most of us believe (or want to believe) that the second carbon era, the Age of Oil, will soon be superseded by the Age of Renewables, just as oil had long since superseded the Age of Coal.  President Obama offered exactly this vision in a much-praised June address on climate change.  True, fossil fuels will be needed a little bit longer, he indicated, but soon enough they will be overtaken by renewable forms of energy.

Many other experts share this view, assuring us that increased reliance on “clean” natural gas combined with expanded investments in wind and solar power will permit a smooth transition to a green energy future in which humanity will no longer be pouring carbon dioxide and other greenhouse gases into the atmosphere.  All this sounds promising indeed.  There is only one fly in the ointment: it is not, in fact, the path we are presently headed down.  The energy industry is not investing in any significant way in renewables.  Instead, it is pouring its historic profits into new fossil-fuel projects, mainly involving the exploitation of what are called “unconventional” oil and gas reserves.

The result is indisputable: humanity is not entering a period that will be dominated by renewables.  Instead, it is pioneering the third great carbon era, the Age of Unconventional Oil and Gas.

That we are embarking on a new carbon era is increasingly evident and should unnerve us all. Hydro-fracking — the use of high-pressure water columns to shatter underground shale formations and liberate the oil and natural gas supplies trapped within them — is being undertaken in ever more regions of the United States and in a growing number of foreign countries.  In the meantime, the exploitation of carbon-dirty heavy oil and tar sands formations is accelerating in Canada, Venezuela, and elsewhere.

It’s true that ever more wind farms and solar arrays are being built, but here’s the kicker: investment in unconventional fossil-fuel extraction and distribution is now expected to outpace spending on renewables by a ratio of at least three-to-one in the decades ahead.

Read the rest at the link.

Nice Things

Atrios made a really good point the other day, avec his typical pith:

And, yes, for whatever reasons, infrastructure projects, especially anything involving a tunnel or a bridge, are absurdly expensive compared to most countries. Other people can figure out just why that is and try to do something about it. But the choice is between increasing rail capacity into New York with an imperfect too expensive plan, or doing nothing at all anytime soon. We spend all kinds of money to do stupid destructive things that at best do nothing useful for us, so we should be willing to support spending all kinds of money on nice things when the opportunities present themselves.

I’d rather have a $10 billion pair of tunnels than spend $10 billion on equipment the military doesn’t even want. That probably isn’t a choice, either, but we do the latter all of the time. We shouldn’t get “sensible” when the former is an option.

This is the point, the rub, the crux and the nub all in one: spending money as the U.S. does on armaments and then rending garments about the costs of infrastructure projects, much less factoring in the externalities for things like car-driving and plane-riding, is our great contradiction as well as the most obvious quandary we are avoiding. This avoidance takes a lot of effort and, as he points out, resources that could be better-invested elsewhere.

Running on Air

If you are watching the NAT&TCAA basketball tournament, you’re seeing a lot of swanky car commercials, especially for upper high-end models from Benz and BMW. The one above is for some super duper 2014 model that you can’t buy yet, and probably can’t afford at all, but it makes the case underscored by the ads punctuating breathless timeouts between the basketball action: dramatic innovations in styling for an utterly archaic propulsion system.

Nothing has changed in the way these amazing chariots propel themselves down the asphalt. Exotic wood inlay on the dashboard? check. 19-speaker surround sound? you bet. HD reverse cameras so you don’t have to turn around to back down the magisterial driveway? Available even in the cheap-O models, nowadays.

Do we think about the fact that the fuel they use and that fuel’s effects on the world remains exactly the same, even with all of the fantastic engineering available?

The fact is it’s easy not to think about this, to nod along with incremental MPG stats while we drool over the nice lines and sleek interiors. But this news from Peugeot made me think about it:

In January, Peugeot announced that it had developed a car that ran on air. It officially launched the Hybrid Air vehicle to the world at the Geneva motor show this month, and revealed that it would be in production by 2016. The car did not solely run on air, of course; the new technology was twinned with a petrol engine. But Peugeot believed that it had significant advantages over battery-powered electric hybrids, such as a Toyota Prius. Their cars would be cheaper to buy, for a start, and extra savings would come from a fuel economy of around 81 miles per gallon.

So what has MB and the ultimate driving machinists been doing this whole time? Makes you wonder.

The wind in your heir


Via Juan Cole, the budget deal from yesterday also included re-upping the tax credit for wind power:

The tax credit, which has been a major driver for wind development across the U.S. over the past two decades, is worth 2.2 cents per kilowatt-hour of energy produced by new wind installations for their first 10 years of operation.

A White House news release confirmed that the production tax credit extension is included in the Senate package that the House also passed. According to industry insiders, it would allow any project that begins construction in 2013 to claim the credit, even if it goes online in 2014. The tax credit that expired on Monday could only be claimed for projects that went online in 2012.

“Just simply, 30 percent of the value of a project is derived from the tax credit,” said Florian Zerhusen, CEO of WKN USA, a San Diego-based wind developer who flipped the switch on two new 3-megawatt turbines in the San Gorgonio Pass on Dec. 21, just days before the credit expired on Monday.

The nascent wind industry needs this, and so do we. If you want to get nationalistic about it, other countries like Germany are eating our lunch and sending us the bill on renewables. Maybe a little healthy competition among advanced nations is good – if we would just choose to act like one. It’s a new year so let’s get with it, and not just on wind. Check out that map. There’s no wind in the South, sure. But there’s a lot of sun, even today.

Image: National Renewable Energy Laboratory.