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The Hydrogen dream | 49 comments (49 topical, editorial, 0 hidden)
Re: The Hydrogen dream (none / 0)
Luis
These cost increases translate themselves into higher debt levels that with present day interest rates can be a killer.

Actually, especially in the USA with ZIRP, present interest rates are highly favorable. The problem is availability of credit and, related, the perceived stability of current rates.

Thanks for the diary.

"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Wed Jan 25th, 2012 at 10:56:00 AM EST
Re: The Hydrogen dream (none / 0)
Hi Geezer. Right now in Portugal the interest rates on micro-generation projects is about 6.5% due to some bonus by the state. Regular borrowing costs are around 8%.

luis_de_sousa@mastodon.social
by Luis de Sousa (luis[dot]de[dot]sousa[at]protonmail[dot]ch) on Wed Jan 25th, 2012 at 12:03:03 PM EST
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Re: The Hydrogen dream (4.00 / 2)
Wow! 8% when there is a dearth of creditworthy projects. Sorta like a spear in the side when you are already being crucified. Must make the IMF proud.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Wed Jan 25th, 2012 at 11:57:48 PM EST
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Re: The Hydrogen dream (none / 1)
Yes interest rates are low, but I think that the market for renewable energy tech in the US is being seriously undermined by shale gas.

In the new issue of Wired, Julie Eilperin writes that clean-technology investment is in the throes of going bust, at least in the United States. That includes solar, wind and biofuels. A U.S. presidential election year and the continuing Solyndra bankruptcy scandal are combining to seriously undercut federal subsidies, she reports. As usual, China is providing stiff competition (the New York Times' Charles Duhigg and Keith Bradsher produce a long, must-read dive into why China and not the U.S. is likely to continue to dominate manufacturing). But the main culprit is cheap natural gas, Eilperin asserts. The shale gas boom, allowing for electricity prices of 10 cents a kilowatt-hour, has eroded the chances of solar and wind to compete.

As discussed over the weekend, Citi Group analyst Edward Morse concludes that shale gas (pictured above, part of a hydraulic fracturing operation in South Montrose, Pa.) could fuel a U.S. industrial renaissance, specifically in energy-intensive products such as chemicals, plastics and housewares. But to the degree that Morse is right, it is coming at a cost, which is a "clean tech meltdown."

Iberdrola just dropped 50 jobs from their American operations. Despite the favorable finance situation, I think that shale gas has changed the demand situation for renewables in the US. I've been thinking that a diary on this is in order. Shale gas is a relatively mature technology in the US, but it's still in its infancy in Europe.  Poland is potentially a huge source of shale gas for the rest of the Continent.  If there's a spike in shale gas production in Europe like in the US, my impression is that the market for renewables would sour as well.

And I'll give my consent to any government that does not deny a man a living wage-Billy Bragg

by ManfromMiddletown (manfrommiddletown at lycos dot com) on Wed Jan 25th, 2012 at 01:07:34 PM EST
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Re: The Hydrogen dream (4.00 / 3)
Hi, TheOilDrum had your tipical anti-wind post last week that discusses this in more detail. What most folk are missing is that shale gas is not in the least commercially feasible with the sort of prices they have today in the US. According to the figures the industry has been providing to the supervising authorities most operations require a price north of 7 $/Mcf to be viable. In fact the US is living a process of gas supply destruction, propelled by the production of associated gas in oil fields. Also at TheOilDrum there's a recent article explaining this dynamic.

In Europe I remain sceptical regarding large developments in shale gas. Giving our much higher population density, any sort of water table contamination can mean that the next days many thousands of folk are left without potable water. To be seen how can this will play out.

luis_de_sousa@mastodon.social
by Luis de Sousa (luis[dot]de[dot]sousa[at]protonmail[dot]ch) on Sat Jan 28th, 2012 at 04:38:10 AM EST
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Re: The Hydrogen dream (4.00 / 2)
Shale gas is a HUGE development, but it's arguably a bubble fueled by constant credit and equity injections from Wall Street, not something that is profitable in its own right, not at current prices at least. The biggest shale player, Chesapeake Energy, recently announced it would be idling a not inconsiderable fraction of its gas wells due to low prices.

The big focus today is the so called "liquid-rich" gas shales, where you get condensate and stuff like that from the ground, which you sell not as gas but as oil.

Peak oil is not an energy crisis. It is a liquid fuel crisis.

by Starvid on Sat Jan 28th, 2012 at 05:34:14 AM EST
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Re: The Hydrogen dream (none / 0)
I've seen the damage that fracking does. I see shale gas as a bubble to.  But, I think that in the short term it's lowered gas prices enough that it's having a huge impact in the market for new wind farms in the US. The fear that I have is that countries that rely upon shale gas to delay the development of renewables are going to end up in a situation where shale gas is either depleted, or finally gets shut down due to the environmental damage it does.  And the contraction of the gas supply drives up electric prices, but there is a reticence to develop new projects because of the market history.

And I'll give my consent to any government that does not deny a man a living wage-Billy Bragg
by ManfromMiddletown (manfrommiddletown at lycos dot com) on Mon Jan 30th, 2012 at 06:27:20 PM EST
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Re: The Hydrogen dream (none / 0)
And bear in mind that shale gas does not have the "bell curve" production dynamics of petroleum ~ if a shale gas play plays out, it can as easily be a sudden drop in output as a slow decline.

I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.
by BruceMcF (agila61 at netscape dot net) on Wed Feb 1st, 2012 at 04:21:12 PM EST
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Re: The Hydrogen dream (none / 0)
I don't know if you'll read this since I'm responding so late.  

But....  my expectation is that the shale gas industry is ramping up the US for an oh shit moment that could have been avoided if gas prices had been kept high in order to faciliate investment in wind.

When the price of gas goes up, new wind farms will too.  But, there's going to be a lot of economic hardship that could have been avoided by doing this right the first time around.


And I'll give my consent to any government that does not deny a man a living wage-Billy Bragg

by ManfromMiddletown (manfrommiddletown at lycos dot com) on Mon Feb 6th, 2012 at 10:11:49 AM EST
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The Hydrogen dream | 49 comments (49 topical, 0 editorial, 0 hidden)
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