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These cost increases translate themselves into higher debt levels that with present day interest rates can be a killer.
Thanks for the diary. "It is not necessary to have hope in order to persevere."
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."
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
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.
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
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