Gentlemen, Start Your Plug-Ins

WSJ
Editorial By R. JAMES WOOLSEY
December 30, 2006;


An oil and security task force of the Council on Foreign Relations
recently opined that "[t]he voices that espouse 'energy independence'
are doing the nation a disservice by focusing on a goal that is
unachievable over the foreseeable future . . ." Others have also
said, essentially, that other nations will control our transportation
fuel -- get used to it. Yet House Democrats have announced a push for
"energy independence in 10 years," and last month General Motors
joined Toyota and perhaps other auto makers in a race to produce
plug-in hybrid vehicles, hugely reducing the demand for oil. Who's
right -- those who drive toward independence or those who shrug?

Bet on major progress toward independence, spurred by market forces
and a portfolio of rapidly developing oil-replacing technologies.

In recent years a number of alternatives to conventional oil have
come to the fore -- oil sands, oil shale, coal-to-diesel and
coal-to-methanol technologies. But their acceptability to a new
Congress, quite possibly the next president, and a public
increasingly concerned about global warming will depend on their
demonstrating affordable and effective methods of sequestering the
carbon they produce or otherwise avoiding carbon emissions.

Ethanol's appeal rose a few years ago when it became clear that
genetically modified biocatalysts could break down the cellulose in
biomass and thus enable ethanol's production from a wide range of
plant life. This means that, compared with corn, little fossil fuel
is needed during biomass cultivation and land use presents much less
of a problem. Indeed two years ago the National Energy Policy
Commission (NEPC), making reasonable assumptions about improved
vehicle efficiency and biomass yields over the next 20 years,
estimated that just 7% of U.S. farmland (the amount now in the Soil
Bank) could produce enough biomass to provide half the fuel needed by
U.S. passenger vehicles, and that production costs for cellulosic
ethanol were headed downward toward around 70 cents per gallon.
Further, conversion of only a portion of industrial, municipal and
animal wastes -- using thermal processes now coming into commercial
operation -- appears to be able to yield an additional several
million barrels a day of diesel or, with some processes, methanol.

But in spite of the technological promise of alternative liquid
fuels, skeptics rightly point out that it will take time to build
production facilities and learn the practicalities of operating
biorefineries and shifting industry from hydrocarbons to
carbohydrates. Most of all there is a sense of investor caution,
driven by memories of the mid-'80s and the late '90s when sharp drops
in oil prices, driven in part by increased production from Saudi
reserves, bankrupted such undertakings as the Synfuels Corporation.
Also, industry support for moving away from oil dependence has long
been weak outside agribusiness, and consumers see little immediate
savings from using alternative liquid fuels.

All this is likely to change decisively, because electricity is about
to become a major partner with alternative liquid fuels in replacing oil.

The change is being driven by innovations in the batteries that now
power modern electronics. If hybrid gasoline-electric cars are
provided with advanced batteries (GM's announcement said its choice
would be lithium-ion) having improved energy and power density --
variants of the ones in our computers and cell phones -- dozens of
vehicle prototypes are now demonstrating that these "plug-in hybrids"
can more than double hybrids' overall (gasoline) mileage. With a
plug-in, charging your car overnight from an ordinary 110-volt socket
in your garage lets you drive 20 miles or more on the electricity
stored in the topped-up battery before the car lapses into its normal
hybrid mode. If you forget to charge or exceed 20 miles, no problem,
you then just have a regular hybrid with the insurance of liquid fuel
in the tank. And during those 20 all-electric miles you will be
driving at a cost of between a penny and three cents a mile instead
of the current 10-cent-a-mile cost of gasoline.

Utilities are rapidly becoming quite interested in plug-ins because
of the substantial benefit to them of being able to sell off-peak
power at night. Because off-peak nighttime charging uses unutilized
capacity, DOE's Pacific Northwest National Laboratory estimates that
adopting plug-ins will not create a need for new base load
electricity generation plants until plug-ins constitute over 84% of
the country's 220 million passenger vehicles. Further, those plug-ins
that are left connected to an electrical socket after being fully
charged (most U.S. cars are parked over 20 hours a day) can
substitute for expensive natural gas by providing electricity from
their batteries back to the grid: "spinning" reserves to help deal
with power outages and regulation of the grid's voltage and amperage.

Once plug-ins start appearing in showrooms it is not only consumers
and utility shareholders who will be smiling. If cheap off-peak
electricity supplies a portion of our transportation needs, this will
help insulate alternative liquid fuels from OPEC market manipulation
designed to cripple oil's competitors. Indian and Chinese demand and
peaking oil production may make it much harder for OPEC today to use
any excess production capacity to drive prices down and destroy
competitive technology. But as plug-ins come into the fleet low
electricity costs will stand as a substantial further barrier to such
market manipulation. Since OPEC cannot drive oil prices low enough to
undermine our use of off-peak electricity, it is unlikely to embark
on a course of radical price cuts at all because such cuts are
painful for its oil-exporter members. Plug-ins thus may well give
investors enough confidence to back alternative liquid fuels without
any need for new taxes on oil or subsidies to protect them.

Environmentalists should join this march with enthusiasm. Replacing
hydrocarbons with fuels derived from biomass and waste reduces
vehicles' carbon emissions very substantially. And replacing gasoline
with electricity further brightens the environmental picture. The
Environmental and Energy Study Institute has shown that, with today's
electricity grid, there would be a national average reduction in
carbon emissions by about 60% per vehicle when a plug-in hybrid with
20-mile all-electric range replaces a conventional car.

Subsidizing expensive substitutes for petroleum, ignoring the massive
infrastructure costs needed to fuel family cars with hydrogen,
searching for a single elegant solution -- none of this has worked,
nor will it. Instead we should encourage a portfolio of inexpensive
fuels, including electricity, that requires very little
infrastructure change and let its components work together: A 50 mpg
hybrid, once it becomes a plug-in, will likely get solidly over 100
mpg of gasoline (call it "mpgg"); if it is also a flexible fuel
vehicle using 85% ethanol, E-85, its mpgg rises to around 500.

The market will likely operate to expand sharply the use of these
technologies that are already in pilot plants and prototypes and
heavily reduce oil use in the foreseeable future. And given the array
of Wahhabis, terrorists and Ahmadinejad-like fanatics who sit atop
the Persian Gulf's two-thirds of the world's conventional oil, such
reduction will not be a disservice to the nation.

Mr. Woolsey, co-chair of the Committee on the Present Danger, was
Director of Central Intelligence from 1993 to 1995.

Lovins changing roles at RMI

By Aspen Times Staff
November 21, 2006

Internationally renowned energy efficiency expert Amory Lovins is about to step down, or at least sideways, as head of the Rocky Mountain Institute in Old Snowmass.

Lovins, 58, announced Monday he is looking for someone to replace him as CEO of the institute. The move would permit him to devote more time and energy to "launching and advancing RMI's high-visibility projects," according to a statement issued by the institute.

Lovins, an acclaimed scientist, researcher and author, co-founded the "think and do tank" in 1982. Over the ensuing years, RMI has gained an international reputation as a valued consultant to corporate and government clients, both in the United States and abroad. Staffers said Lovins has become a highly sought-after adviser to everyone from the captains of industry to heads of state around the world.

Insiders at RMI said these demands on Lovins' time have driven the decision to find a new CEO, explaining Lovins will stay at the post until a replacement is found. Then, he will be known as "Chairman and Chief Scientist" and "focus solely on strategic influence, thought leadership, and guidance of RMI's key strategic projects," in the words of the statement.

"The convergence of costly oil, global tensions, climate change, and political polarization makes RMI's nonpartisan and systemic approach even more needed and effective," Lovins added.

The statement also explained that Executive Director Marty Pickett, who has been at RMI for more than eight years, will become chief operating officer of the organization.

The organization will continue to operate its Boulder office, to which the U.S. Green Building Council recently awarded the world's first LEED Platinum rating for commercial interior retrofits.

The Aspen Times, Aspen, Colo.

Where Should I Go to Become Carbon Neutral?

Source: Dr. Mark C. Trexler

I tackled a similar question back in October of last year. I've been receiving this kind of question more and more frequently this year, so I thought it was worth revisiting this issue in light of recent developments.

It's still not an easy question to answer. There are lots of places you can buy carbon offsets these days; in fact, there are many more options for consumers than there were last year. Unfortunately, it's still difficult — if not impossible - for casual buyers of carbon offsets to figure out what they're really buying. Are you really purchasing a commodity that neutralizes part of or your entire personal carbon footprint? Or are you making a philanthropic contribution to a good-sounding cause, but not really causing your personal GHG footprint to be neutralized?

What's really changed since last October is the amount of attention these questions are receiving, from many sources. The Ecosystem Marketplace is closely tracking voluntary offset markets; it's a good place to keep up to date on the field. A few specific initiatives that are worth mentioning:

* The Climate Group and the International Emissions Trading Association released a draft Voluntary Carbon Standard (VCS) earlier this year in an effort to standardize the treatment of voluntary carbon offsets (I reported on the VCS in a recent column, and nothing fundamental has changed).

* The Leonardo Academy recently announced it would develop an ANSI standard for carbon offsets, although I haven't been able to figure out what such a standard would really look like.

* The Center for Resource Solutions has announced its intent to develop a certification process for carbon offsets that is intended to help ensure that the same offset is not sold multiple times.

* The Rocky Mountain Institute is launching an initiative to promote offset quality.

* The Climate Trust and the International Emissions Trading Association are cooperating on their own project to promote offset quality.


Whether any or all of these efforts will make it easier for individual consumers to reliably become carbon neutral through the many websites offering carbon neutrality services remains to be seen. Several initiatives are taking the approach of trying to develop "quality standards" for voluntary carbon offsets. As we've seen in the past, this kind of effort is almost doomed from the start; while it’s possible for someone with experience to reliably differentiate between clearly high-quality and clearly low-quality offsets, it is much more difficult to develop a written quality standard that covers all the possible types of GHG emissions reductions. So we’ll have to see how these initiatives evolve.

Two other efforts are also worth mentioning:

* Environmental Defense steers consumers to offset projects and providers that ED puts through an internal screening process (see http://www.fightglobalwarming.com). Some consumers may find this useful in deciding where to go.

* On behalf of Clean Air Cool Planet, a nonprofit headquartered in Portsmouth, NH, my firm, Trexler Climate + Energy Services, Inc., is compiling a consumer guide to retail offset providers. Using several evaluative criteria, the guide will be intended to help point consumers to retail offset providers that credibly promote carbon neutrality on behalf of consumers and other buyers. We hope to complete the project by the end of the summer.


So if you’re concerned about how to best go carbon neutral as one means of doing your part for climate change, stay tuned. There’s light at the end of the tunnel.

Securing energy needs

SIDE NOTE: The below closely resembles the fact situation presented to us for the 1992 Jessup International Moot Court Competition. Pretty scary stuff.

Washington Times
Editorial By Frank J. Gaffney Jr.

Published December 27, 2006

Seemingly unrelated events of last week suggest considerable trouble ahead for U.S. vital interests. As President Bush puts the finishing touches on his plans for a new strategy for waging the War for the Free World, he had best make sure he focuses not only on Iraq and Iran (as recommended in this space last week) but on energy security, as well.

Consider the following developments:

On the eve of last week's United Nations Security Council vote on sanctions supposed to isolate Islamofascist Iran over its nuclear weapons ambitions, Communist China agreed to invest an additional $16 billion in the Iranian North Pars natural gas fields (on top of the more than $100 billion already committed by the PRC to other energy projects in the country). The latest memorandum of understanding, signed by Tehran and CNOOC, China's biggest offshore oil producer, would involve the exploitation of the North Pars fields and the construction of Iranian liquefied natural gas facilities, whose products would then be exported to China.

This deal was of a piece with other actions taken by Moscow and Beijing to water-down the U.N. sanctions resolution to the point where it was virtually a dead-letter even before it was adopted. The president can expect many more such pyrrhic victories now that his faithful lieutenant, John Bolton, has been forced to leave the Turtle Bay portfolio to the tender mercies of lowest-common-denominator-minded State Department diplomats like Under Secretary Nick Burns.

Last week, the Financial Times of London reported that Gazprom -- the government-owned gas company that epitomizes the increasingly fascistic character of Vladimir Putin's Russia and serves increasingly blatantly as an instrument of state power -- "cement[ed] the Kremlin's grip on the country's energy resources." It did so by euchring several foreign oil companies, led by Royal Dutch Shell into ceding majority control over Siberia's lucrative Sakhalin 2 oil and gas project.

The cynical way in which this shakedown was accomplished is typical of Mr. Putin's heavy-handed behavior on other matters, from the protection racket he and his Chinese allies run for the North Koreans, Sudanese and Iranians at the United Nations to the liquidation of his enemies at home and abroad. After the Kremlin maintained for months that environmental concerns precluded necessary approvals from being issued to Shell and its Japanese partners, the moment Gazprom secured its controlling majority, such concerns miraculously disappeared.

According to the Wall Street Journal, U.S. law enforcement officials are attempting to unravel the myriad, complex and deliberately confusing ties between one of the FBI's most wanted men, Russian mafia kingpin Semion Mogilevich, and "multibillion gas deals between Russia and Ukraine."The Journal reports American concerns about such ties have "only grown as Russia has tightened its grip on the vast oil and gas resources of Central Asia and shown a growing willingness to brandish energy as a political weapon. The European Union gets a quarter of its natural gas from Russia, most of which is shipped by pipeline across Ukraine."

What these events have in common is the danger the West's energy security will be ever-more at the mercy of foreign governments hostile to freedom and its friends. As the Communist Chinese and fascistic Russian regimes move to forge close relations with energy-rich nations like Iran, Libya, Sudan, Venezuela, Bolivia, Ecuador and Saudi Arabia, and as the Kremlin consolidates its control over Russia's own vast resources, America and her allies will find themselves increasingly imperiled by their dependency on such sources for oil products and/or natural gas.

As a result, President Bush needs to make increased U.S. energy security a central part of the overhauled war-fighting strategy that he is set to announce next month. To do so, he must clearly go beyond the lip service that he paid to our "addiction to oil" in last year's State of the Union speech by taking steps that will make a difference.

Done properly, energy security could be one of the most promising areas for cooperation between the Bush Administration and Democrats in Congress. By concentrating on areas where considerable progress is possible (rather than on such neuralgic issues as drilling in the Arctic National Wildlife Refuge or increased CAFE fuel-efficiency standards), America -- and in particular its gas-guzzling transportation sector -- could be made significantly less reliant on oil supplied by unstable or hostile regimes.

Such a course of action has been laid out in a blueprint produced by the Set America Free Coalition -- a group spanning the political spectrum -- that forms the basis for the bipartisan, bicameral Vehicle Fuel Choices for American Security Act (introduced in the last session of Congress as S.2025 in the Senate and H.R. 4409 in the House). It entails two principal steps: (1) ensuring all cars sold in America will be Flexible Fuel Vehicles, capable of burning not just gasoline but ethanol and methanol (or some combination thereof); and (2) assuring the availability of substantially increased quantities of such alternative fuels.

This legislation would also help make electricity a true transportation fuel, by promoting the manufacture of plug-in hybrid vehicles. Since scarcely any electricity is generated in America by burning oil, the widespread use of such vehicles could greatly reduce our dependence on foreign sources of petroleum. To realize the full potential of this option, however, President Bush and the Congress will need to join forces on one other important initiative: assuring large-scale U.S. production of advanced lithium ion batteries, an essential ingredient for our future energy -- and national -- security and the competitiveness of our auto industry.


Frank J. Gaffney Jr. is president of the Center for Security Policy, a member of the Set America Free Coalition and a columnist for The Washington Times.

Zero-emission cars are still only a dream

The Birmingham Post
Dec 27 2006

By Michael Shields, Special Correspondent


The dream of smog-free cities served by whispering fleets of zero-emission cars could still be decades away from becoming reality.

Internal combustion engines have established such a stranglehold on the automotive industry that they will probably outlast everyone alive today, automotive specialists suggest.

Only limited numbers of non-polluting cars that run on hydrogen-powered fuel cells or that burn hydrogen rather than petrol or diesel are on the road, and even their most vociferous supporters say they will stay in the slow lane to the future.

"We have 900 million passenger cars and light trucks on the road and 51 million units of annual production capacity for those vehicles. ..TEXT "It would thus take decades to replace all vehicles with combustion engines by those with fuel cells, even if the fuel cell production would be sufficient," said Thomas Weber, head of research at DaimlerChrysler.

Mr Weber believes the realistic approach will be to keep screwing down emissions from standard engines in steps so that they get as close to zero emissions as possible.

Real zero-emissions driving is possible only with fuel cells or electric cars. These vehicles have largely flopped and their batteries remain a problem.

"Battery technology is the Achilles' heel of electric vehicles today. If battery manufacturers could make a breakthrough then the electric car could see a renaissance," Mr Weber said.

How often you can drain and then recharge batteries before they wear out remains a major problem area.

Fuel cells use the interaction between hydrogen and oxygen to produce electricity that powers the car while emitting only water vapour.

Fuel cell technology is making rapid progress, but still costs far too much and lacks the network of filling stations that motorists will need to tank up.

"Infrastructure is a big question mark," said Takis Athanasopoulos, former executive vice-president of Toyota in Europe and still a senior company adviser.

He said that much of the hydrogen used today is produced with the help of traditional fossil fuels.

"This technology is not yet clean technology," he noted.

Toyota is the world market leader in hybrid vehicles which reduce fuel consumption and thus emissions by yoking an electric motor and battery to standard engines.

The cars can run on battery power alone at low speeds and recharge by capturing energy released in braking.

As an abundant, clean energy source, hydrogen is a natural choice for a world facing a limited supply of increasingly expensive fossil fuels. Estimates differ widely on when fuel cells will catch on after initial estimates were far too bold.

DaimlerChrysler thinks commercial sales may start around 2012 but that fuel cell cars will have a single-digit share of the new car market by 2020 at the earliest.

Other industry experts think even that is too ambitious unless governments force the issue by levying London-style congestion fees on polluting cars.

Charles Stone, research head at Canadian fuel-cell company Ballard Power Systems, acknowledged that cost and durability were the biggest challenges.

"If it had a market share of 50 per cent by 2050, I would die a very happy man," he said.

The recent rise in the price of oil has increased pressure on carmakers to illustrate their green credentials.

BMW has just announced it will launch a hydrogen-burning 7 Series executive car early next year, but it costs so much that selected customers can only lease it.

Carmakers and suppliers admit they are unsure what form their industry's future will take and are worried about putting all their eggs in one technology basket.

"Actually nobody knows at the moment where this is going to end. I believe you have to have a very broad investment in technology because probably all of these (technologies) are going to be required as we go forward," Ford of Europe president John Fleming said last week.

Karl-Thomas Neumann, head of German tyre maker and car parts group Continental's automotive division, cautioned: "This is not something where someone will just turn a switch,

"Emissions will be driven down and fuel consumption will be driven down with the existing engines. At the same time we will see the whole spectrum of hybrids, from microhybrids to full hybrids."

Microhybrids save fuel by turning engines off at stop lights and restarting them when drivers step on the gas.

Mr Weber thought fuel cells would first gain use in urban areas and in fleets - for instance, buses that return to a depot every night.

"This solves the challenge of infrastructure and fuelling stations. The technology will be used in rural populated areas.

"But for now it makes little sense to implement it coast to coast in the US."

Staff urges wind-power project OK

By JOE RANKIN
Staff Writer Kennebec Journal & Morning Sentinel Saturday
December 23, 2006

AUGUSTA -- The staff of the Maine Land Use Regulation Commission has recommended approval of a proposed $150 million wind power project in northern Franklin County.

The draft recommendation on Maine Mountain Power's Redington wind farm was released Friday. It goes before the seven-member Commission for a vote Jan. 24.

Final approval could make Maine a leader in wind power in the region and pave the way for other projects, including the even larger TransCanada wind farm proposed for Kibby Mountain to the northwest.

The Commission staff determined after months of review that the Redington project complies with the agency's comprehensive plan and state laws, Director Catherine Carroll said Friday.

She predicts "extensive deliberations" when commissioners meet in January. "It's entirely now in the hands of the Commission, and we'll find out what they do," she said.

The draft decision recommends approval of a zoning change to allow the wind farm and its preliminary development plan.

The 90-megawatt project calls for 30 huge wind turbines on Redington Pond Range and Black Nubble Mountain, between Carrabassett Valley and Rangeley, with ridgeline roads, weather monitoring towers, and two transmission lines.

"It's great. I'm relieved. It's been a phenomenal amount of work," said Harley Lee, the president of Maine-based Endless Energy, which teamed up with Edison Mission Group of California to pursue the project.

Lee has been working to site a wind power project in the area for 17 years.

"It's the right project, at the right place, at the right time," he said Friday. "Our energy system is broken. It's not economically sustainable, environmentally sustainable, or socially sustainable. We need to take some big steps and I think this wind farm is a good step for Maine to take."

Lee said that, contingent on Commission approval, site clearing could begin later this winter, with turbines coming on-line by the end of next year.

While the Redington-Black Nubble project has yet to generate electricity, it has generated plenty of controversy, based largely on its location in an area of 4,000-foot peaks, and because it would be visible from Maine's premier hiking path, the Appalachian Trail.

Hundreds of people showed up for three days of hearings on the wind farm last August.

The project sowed fractures in Maine's environmental community. Some organizations supported it as a generator of clean energy and antidote to global warming, others opposed it because of the potential for damage to sensitive sub-alpine ecosystems and the effect of the lighted turbines on the landscape.

The 30 turbine towers would each be 260 feet tall, with 150-foot blades, making them a total of 410 feet tall, or about a tenth the height of the mountain. They would be lighted with slow-cycling on-off red lights to warn aircraft.

Steve Hinchman, a staff attorney for the Conservation Law Foundation, said Friday that final approval of the zoning change and development plan by the Commission could set a "critical precedent for Maine" by affirming that wind power is an appropriate use of Maine's North Woods.

"This is a megaproject for Maine and it's also big news for wind development. If we're going to transition to a carbon-free economy, which we have to do to beat global warming in Maine, then we're going to need a lot of wind power. This may be only one project, but it's a significant step," Hinchman said.

A 50-megawatt wind power project is under construction in Mars Hill in Aroostook County. Canadian energy giant TransCanada has said it will file for LURC permits to build a $250 to $300 million, 132-megawatt, wind farm of 44 turbines on Kibby Mountain near the Quebec border.

Pete Didisheim, the advocacy director for the Natural Resources Council of Maine, said Friday that he was "surprised in some regards" by the draft recommendation on Maine Mountain Power's proposal. "It really could have gone either way," he said.

The Council had promoted a compromise plan that would have limited the wind farm to Black Nubble mountain, while protecting loaf-shaped Redington.

That would have halved the size of the project and kept it farther from the Appalachian Trail, but neither developer nor opponents would give ground, said Didisheim.

Didisheim praised the Commission staffers for their work. "It's a difficult balancing act between doing the right thing to deal with global warming and move ahead with clean energy and also trying to protect what's special about Maine," he said.

The Council, Maine's largest environmental group, would probably not appeal if approval is forthcoming, he said: "We'll support whatever decision the commission makes."

Didisheim said his review of the 130-plus page recommendation showed only routine construction conditions, such as ones for access roads and transmission lines. "There's no big surprising requirements," he said.

The draft approval requires continued monitoring for the project's effects on birds and bats, and also requires the developer to present a habitat protection plan for the threatened northern bog lemming.

Didisheim said he was surprised that the Commission didn't require that the developer buy more land in the area to balance out the impact of the power project.

Jenn Burns, a staff attorney with the Maine Audubon Society, which opposed the project, said her organization is "disappointed, but we'll be curious to hear the commissioners discuss and deliberate at length on the issue. I wouldn't expect them to necessarily rubber stamp it."

She said she wasn't particularly surprised by the staff recommendation of approval. "I think that there's been a bit of support for the project, but there's also been a lot of strong issues raised with concerns about the project."

Joe Rankin - 861-9249

jrankin@centralmaine.com

The Building is the Solar Cell

Wired News

By Courtney Barry
02:00 AM Dec, 21, 2006

A new solar panel is 100 times thinner and could be significantly cheaper than traditional photovoltaic materials, making it a possible competitor to the silicon-dominated world of solar energy.

Building materials such as steel, glass and roofing may soon have embedded solar cells thanks to a thin-film technology that uses copper indium gallium selenide, or CIGS, instead of silicon.

Several companies, including Nanosolar, Miasolé, Global Solar and HelioVolt are developing CIGS systems. Several investors and industry experts say HelioVolt leads the pack.

"What sets HelioVolt apart is that its technology allows them to deposit thin-film materials more quickly, efficiently and at a potentially lower cost than conventional process technologies," said Joel Serface, director of the Clean Energy Incubator in Austin, Texas.

HelioVolt's manufacturing process is between 80 percent and 98 percent faster than other thin-film manufacturing processes, according to Serface. The company's efficient system has recently translated into venture capital, as well as accolades from Time magazine and The Wall Street Journal.

"Our goal is that energy coming from our (technology) would be competitive with energy today in the home -- without subsidies," said Jimmy Treybig, a HelioVolt investor and founder and former CEO of Tandem Computers.

Without government support, alternative-energy scientists have more motivation to become cost-competitive with petroleum, Treybig said.

Manufacturing silicon cells costs roughly $3 a watt, while CIGS technology could lower the price to $1 a watt if HelioVolt and others can streamline the manufacturing process.

"The long-term target to make solar pervasive is $1 per watt," Serface said. "Silicon and thin film are both trying to achieve this."

HelioVolt's goal is to build a manufacturing plant in 2007, with commercial marketing scheduled for 2008.

GOVERNOR ANNOUNCES FIRST PLUG-IN HYBRID ADDED TO STATE FLEET

NY State Press Release
Dece.ber 20, 2006

High Mileage Vehicle Part of Governor’s Plan to Reduce Dependence on Imported Energy $10 Million Program to Convert State’s Hybrids to Plug-ins that can achieve 100 mpg

Governor George E. Pataki today showcased a new plug-in hybrid car that is being added to New York State’s vehicle fleet, another step toward reducing our dependence on imported energy and protecting our environment. Earlier this year, the Governor announced a $10 million program to convert the 574 hybrid vehicles in the State fleet to be plug-in hybrids, which can achieve significantly higher mileage with lower emissions of harmful pollutants.

“Emerging energy technologies are providing exciting new opportunities for us to break away from our long-term reliance on petroleum, while also helping to protect our air quality,” Governor Pataki said. “Plug-in hybrids use advanced battery technology to nearly double the typical miles per gallon for hybrid vehicles, meaning we can lower fuel consumption and decrease harmful emissions. It is clearly a vehicle that has the potential to revolutionize the industry and I am proud that New York is leading the way in promoting these development and use of these vehicles.”

Because of their advanced batteries, plug-in hybrid vehicles are able to be charged through a standard household current to achieve significantly greater mileage. These vehicles operate on emissions-free battery power, reducing the amount of fuel utilized and significantly decreasing the release of harmful pollutants, including greenhouse gases.

On August 1, 2006, Governor Pataki unveiled plans for the $10 million plug-in hybrid conversion program at the Saratoga Energy and Technology Park (STEP) in Malta, Saratoga County. This program will facilitate the development and deployment of these advanced, high-mileage vehicles.

The vehicle being added to the State fleet is a plug-in Prius with a converted electric power pack that is expected to achieve 100 miles per gallon or more. The vehicle is the first introduced as part of a two-phase program conducted by the New York State Energy Research and Development Authority (NYSERDA). Plans call for the conversion of two Priuses, followed by three Ford Escape SUVs and a Honda Civic for technical evaluation.

Peter R. Smith, president and CEO of NYSERDA said, “The second phase of the program will be to bulk-purchase the selected technologies for installation on the remaining hybrids in the State fleet. Phase One, with design and prototyping will cost up to a million dollars; Phase Two involves bulk conversions and is budgeted for up to $9 million. It is anticipated that the technology will attract more manufacturers and drive the technology into the public market. Once the technology becomes popular, that’s when unit costs will decline considerably.”

State Office of General Services (OGS) Commissioner, John J. Spano said, “Thanks to Governor Pataki’s commitment to expanding the use of alternative fuels and reducing our State’s dependency on foreign oil, New York has transformed its vehicle fleet from having almost no clean-fueled vehicles in 1995 to now having 6,143 alternative-fueled vehicles. That’s approximately 46 percent of total State vehicles and we have an additional 277 on order. This new initiative with NYSERDA to add plug-in hybrids to the State fleet is just one more example of how New York is leading the nation in the use of alternative fueled vehicles.”

The converted vehicles will use standard 110-volt household current, a departure from previous electric vehicles that required higher voltage hookups. The vehicles can be charged overnight, which would take advantage of lower, off-peak utility electric rates where offered. The new power packs designed by the converting contractors feature different technologies, and the competition among the four companies will provide many new and innovative ideas to the existing hybrid systems.

The four specialty contractors competitively selected to participate in this program have considerable electric-vehicle experience. The Prius on display today was converted by A123Systems of Watertown, Massachusetts and Hymotion of Concord, Ontario. This team will convert one of each three brands. Ford Escapes will be converted by Elecytrovaya of Ballston Spa and Mississauga, Ontario and Hybrids Plus of Boulder, Colorado. The second Prius will be converted by Energy CS of Monrovia, California. The vehicles will be delivered during the first quarter of 2007 for testing and evaluation by NYSERDA staff and consultants, in conjunction with the U.S. Department of Energy. Once the vehicles have proven reliable, they will be placed in fleet service over the second quarter of 2007, for use by various State agencies.

General Motors is the latest major manufacturer to announce that it will produce a plug-in hybrid vehicle - the Saturn Vue plug-in hybrid. Others, including Ford, Daimler Chrysler, and Toyota also have expressed serious interest in the mileage-boosting technology.

Under the “fuel neutral” approach adopted by New York’s Clean Fueled Vehicle Council, the State has transformed its vehicle fleet from having almost no clean-fueled vehicles in 1995 to now having 6,143 alternative-fueled vehicles. This represents approximately 46 percent of total State vehicles, with an additional 277 on order. Of the total alternative-fueled vehicles:

* 2,216 use CNG;
* 2,291 can use ethanol (E85);
* 101 are electric;
* 129 use propane;
* 574 are hybrid vehicles;
* 831 use neighborhood electric; and
* 1 uses hydrogen.

The use of these alternative-fueled vehicles reduced the State’s use of petroleum in its vehicles by nearly 3.2 million gallons in the last five years.

In his 2006 State of the State Address and Executive Budget, Governor Pataki outlined a series of initiatives to reduce our dependence on imported energy. This energy independence plan promotes greater use of clean, renewable fuels, and will spur additional research and development into clean and alternative energy sources. Among the initiatives proposed by the Governor and approved by the State Legislature were:

* The elimination of all State taxes on renewable automobile fuels, including ethanol (E85), biodiesel, and compressed natural gas (CNG), hydrogen, and other renewable fuels, providing a savings of approximately 40 cents/gallon for consumers.
* A $10 million competitive grant program, administered by NYSERDA, for private sector gasoline companies to install renewable fuel pumps for E85, biodiesel, CNG, or other renewable fuels. It is estimated that the program will support the installation and operation of between 400 and 600 renewable fuel pumps at private stations across the State. The New York State Thruway Authority is already moving forward with its program to install renewable fuel pumps at all 27 Thruway travel plazas.
* The expansion of the State’s Empire Zones program to provide tax benefits to clean energy companies regardless of where they are located in New York State. These tax incentives will be available to qualifying companies engaged in research, development, or manufacturing of energy-efficient or renewable energy technologies or products.
* A $5 million competitive grant program, administered by NYSERDA, for start-up companies that are developing or deploying the next generation of vehicle batteries, propulsions systems, and lightweight vehicle parts and components.
* The elimination of "exclusivity contracts" between fuel providers and retail service stations, which only allow the service stations to sell specific brands of fuel. In most cases, these brands do not include renewable fuels. Since the “exclusivity” contracts prohibit service stations from obtaining renewable fuels like ethanol (E85) from other sources, these fuels are not available for sale to consumers.
* Tax credits to cover up to 50 percent of the cost of purchasing alternative fuel vehicle refueling equipment that would be used by facilities selling E85, biodiesel, CNG, hydrogen, natural gas, liquefied or petroleum gas.
* A $5 million competitive grant program, administered by NYSERDA, for the development of hydrogen fueling stations across New York and the conversion of existing internal combustion vehicles to be able to operate using hydrogen fuel.

Earlier today, the Governor also announced a conditional agreement to develop an advanced clean coal power plant and awards totaling $25.2 million for the development of two cellulosic ethanol pilot plants in New York State. The facilities will utilize abundant plant and waste materials to create clean, homegrown renewable fuel for vehicles, helping to reduce our dependence on imported energy.

Eye Sore or Cash Cow?

Portland Press Herald
December 3, 2006

MARS HILL - The conversation in Mikala Woollard's hair salon these days usually revolves around the windmills.

"I hear both sides of it, all day long," she said.

And whenever she steps outside, there they are, looming behind the house she and her husband built on the side of Mars Hill Mountain. "There's no getting away from it, for me anyway."

This quiet farming community next to the Canadian border is getting a lot of attention these days as home to New England's first major wind farm. Twenty towering windmills line the ridge of Mars Hill Mountain, visible from virtually everywhere in town, and from several surrounding towns, too. Eight more turbines are about to go up, and the blades should start turning and generating power this month.

The windmills already are changing the town's identity. To some, they're beautiful. To others, an industrial eyesore. How well the wind farm fits in around here could affect plans for many other wind farms planned around the state.

"I'm absolutely sure there will be more as people see what they're all about," said Town Manager Raymond Mersereau. "Mars Hill is plowing the ground."

Plowing is nothing new for the people of this town. Mars Hill sits in the heart of Aroostook County potato country, where generations of close-knit families have grown up on farms.

But harvesting wind is new, and so is being the focus of attention and curiosity.

Residents of the county know Mars Hill for its golf course and ski slope. But most people who come here are simply passing through on Route 1. Until now, the town's biggest claim to fame may have been that the peak of Mars Hill Mountain is the first place in the United States to see the sunrise - in summer at least. Cadillac Mountain on Mount Desert Island and Porcupine Mountain in Lubec share the honor in winter.

Now, as 80-year-old native John Ackerman put it, "we've got something no one else has."

Ackerman, for one, is pleased about that. "I can't see anything wrong with it," he said, as the breakfast discussion in Al's Diner on Main Street turned, again, to windmills.

"It'll give the town a good tax base," said Lynwood Brown, a 75-year-old from the neighboring town of Blaine.

Ackerman and Brown predicted that those who don't like the windmills will get used to them, just like they got used to the first ski tow in the 1960s. "There was a lot of people saying then it's going to ruin the mountain," Brown said.

The wind farm already has been drawing visitors to Mars Hill to check it out, and many here expect tourism to be one of the spinoff benefits. "That's going to be an attraction," Ackerman said.

That kind of acceptance, if not support, is considered a big reason Mars Hill is leading the way.

"Here, there are people who are against it but they're not so adamant about it as they are in other places," Mersereau said.

"We're more attuned to people using the land the way they want to."
Another reason may be that Mars Hill Mountain, a lone sloping rock rising from the rolling farm fields next to the Canadian border, was already developed to some extent with cell towers and the Big Rock Ski Area.

The biggest reason, though, is the wind that blows steadily over the sloping mountain as if passing over a windfoil.

"This is a great wind site," said Andrew Perkins, project manager for Evergreen Wind Power LLC, developer of the $55 million wind farm.

The 28 windmills will be spread more than four miles across the ridgeline. Each stands 262 feet tall at the hub, with three 115-foot-long blades sticking out.

The windmills are expected to start spinning and generating power by the end of December, Perkins said. At peak conditions, the turbines will make 20 revolutions per minute and generate 42 megawatts, enough electricity to power more than 40,000 homes.

Until now, New England's largest wind farm was a 6-megawatt plant with 11 windmills in northwestern Vermont.

The electricity made in Mars Hill will go onto the commercial grid, which means the wind power will flow into New Brunswick, Canada, where demand is stronger, rather than into Maine.

The company and the town negotiated an agreement that gives the wind farm a fixed tax bill -- $500,000 a year for 20 years. That's equal to nearly one-third of the town's total tax revenue -- $1.6 million.
The state is certain to keep its share of the new revenue -- technically, it will reduce the town's education funding -- but Mars Hill is still expected to keep at least $250,000 a year. That will be enough to reduce residential tax bills by as much as 20 percent, or $400 a year for the owner of a home assessed at $80,000, Mersereau said. "This was a very fair deal for the town," he said.

Not everyone here is convinced. George Hatt of Mars Hill said he doubts taxes will actually drop, and he thinks the town could have done better than $500,000 a year. "That's not a lot of money," Hatt said.

The project overcame a range of concerns, such as the potential for the windmills to kill birds or bats, something turbines have done in other parts of the country. Radar monitoring indicated the turbines were not located in the path of a significant flyway, although the company is required to monitor wildlife impacts.

On the other hand, some people have been supportive because the wind farm's clean, renewable energy will replace power made by burning fossil fuels, a process that contributes to global warming.

Now that people are getting a good look at the windmills, however, the visual impact on the town's rural landscape is dominating the conversation.

A lot of people are not happy with the new look, said Woollard, the hair stylist.

Woollard mostly bites her tongue when customers complain about the windmills or about not getting enough information before the project was approved. But she understands.

"Basically, I like the mountain the way it was," she said. "I just hope it does benefit the town in some way."

Woollard expects she'll soon be hearing the windmills in addition to seeing them, although the developer says the noise will be minimal.

Michele Morrison, who works at Al's Diner on Main Street here, said she can see the windmills from her home in Presque Isle and they are just as ugly from a distance as they are up close.

"I used to love to look at the mountain. It's beautiful in every season," Morrison said. "It's ruined."

A lot of people here are surprised at how much the windmills dominate the view, she said. And the idea that people would go out of their way to come to Mars Hill and look at them makes no sense to her. "For what?" she said. "Who wants to see that?"

Few people live closer to the windmills than Michele Kearney and her family. Their new home is on the mountain's eastern slope beneath several turbines.

"When the sunset hits them, they're kind of neat," Kearney said. "My kids say it's like candles on a cake."

She's also wondering what they will sound like, but she's not worrying, she said. The time has come for renewable energy, she said.

"Times are changing," she said. "I just can't see what's wrong with them."

Advocates of wind power are counting on that attitude to spread.
Large wind farms have been proposed for Redington Township near the Sugarloaf Ski Resort, northern Aroostook County and Kibby Mountain in the western mountains, and there are smaller projects planned in Freedom and Deer Isle.

A total of about 1,000 megawatts of wind power is on the drawing board in Maine, the equivalent of more than 20 wind farms the size of the one on Mars Hill Mountain, said Beth Nagusky, director of Maine's Office of Energy Independence and Security.

"The potential is huge. It's a really exciting time," she said. "That's one thing we can do to stop global warming, which to me is the most serious environmental and social threat this world faces."
Each of the wind farm proposals will face its own challenges, such as the local wildlife and aesthetic impacts, Nagusky said. But she hopes Mars Hill is the beginning of a new trend.

"Maybe more people will think that they aren't so bad and it's a sacrifice worth making," Nagusky said.

Staff Writer John Richardson can be contacted at 791-6324 or at:
jrichardson@pressherald.com

Whichever Way the Wind Blows

NY Times

Thomas Friedman
December 18, 2006

Time for another news quiz: Which American state produces more wind-generated electricity than any other? Answer: Texas. Next question — this one you’ll never get: Which politician launched the Texas wind industry? Answer: Former Gov., now President, George W. Bush.

Yes, there are many things that baffle me about President Bush, but none more than how the same man who initiated one of the most effective renewable energy programs in America, has presided over an administration that for six years has dragged its feet on alternative energy, used its regulatory powers to weaken efficiency standards for major appliances and stuck its head in the sand on global warming.

I’ll wait for historians to sort that out. But here is some immediate advice I can give the president: If you want to salvage any positive legacy, it will not come from Iraq. There are only tears left there. No, the only way for you, Mr. President, to salvage any legacy is to get back in touch with your green Texas roots and devote the rest of your term to REALLY ending America’s oil addiction, liberating us from dependence on petro-authoritarian regimes and making America the leader in renewable energies that combat climate change.

If this isn’t the core of Mr. Bush’s next State of the Union, he might as well go back to Crawford now. At least there he might be able to contemplate what went wrong with his presidency under lights powered by clean, wind-generated electricity that he promoted.

I came down to West Texas, the Saudi Arabia of wind, to find out how it all happened. Pat Wood, a friend of the president, was chairman of Texas’s Public Utility Commission when the push for wind energy started.

"At the end of a meeting on transmission policy in mid-1996," he recalled, "I was on my way out the door of the governor’s office, when Governor Bush said to me, ‘Pat, we like wind.’ He was at his desk. I said, ‘We what?’ He said: ‘You heard me. Go get smart on wind.’ "

Mr. Wood, his fellow commissioners and the Texas utilities did just that. They conducted polls and were stunned by the results: Texas electricity customers were ready to pay a little extra to get more clean renewable energy. So Mr. Bush instructed Mr. Wood to work on wind with the utilities and the environmentalists. Together, they created the Texas Renewable Portfolio Mandate, which Mr. Bush got passed by the Texas Legislature in 1999, as part of a power competition bill. The mandate stipulated that Texas power companies had to produce 2,000 new megawatts of electricity from renewables, mostly wind, by 2009.

What happened? A dozen new companies jumped into the Texas market and built wind turbines to meet the mandate — so many that the 2,000-megawatt goal was reached in 2005. So now the Texas Legislature has upped the mandate to 5,000 megawatts by 2015. Everyone knows they’ll beat that, too, because all this investment has driven down the costs and made wind power in Texas competitive with clean coal, nuclear and natural gas, even without the temporary tax break. Mr. Wood says he thinks Texas could be producing 15 percent of all its energy from renewables by 2015.

An energy wiz, Mr. Wood now advises Airtricity, an Irish wind-power company that also entered the Texas market. He and I toured its new wind farm near Midland, which will provide enough wind electricity — 125 megawatts — to power 40,000 homes in Dallas, replacing gas, nuclear and coal. The farm consists of giant turbines that sprout like Star Wars machine-monsters from the hardscrabble plains around Midland — amid the mesquite, rattlesnakes and oil-pumping jacks.

When Mr. Bush ran for governor, his motto was: "What Texans can dream, Texans can do." Just substitute "Americans" for "Texans," and he’s already got the last line of his next State of the Union. What would the substance be? First, let’s set a Texas-like renewable energy mandate for every state. Second, let’s forge a national electricity transmission grid from the Dakotas to Texas to take wind electricity from where it is best produced to the big cities where it is most needed. Finally, let’s create a long-term tax subsidy for building and buying plug-in hybrid cars. Wind energy is produced abundantly at night, when demand is lowest. Electric hybrids would be charged at night. That would mean hybrid electric cars, which emit virtually no carbon, could be powered by wind, which produces no carbon. If that scaled, it could be better than Kyoto.

You got something better to do, Mr. President?

New type of battery pushed for hybrid cars

Detroit Free Press
BY JASON ROBERSON
FREE PRESS BUSINESS WRITER

December 16, 2006

photo

At left is a 2-volt cell of a typical lead acid car battery. At right is Firefly Energy's smaller version. Carbon is used instead of metal. (Firefly Energy)

Executives with Firefly Energy Inc., a battery developer in Peoria, Ill., came to Detroit on Friday pitching what they said was a smaller, safer and less expensive battery than those now used in hybrid electric vehicles.

Firefly cofounders Mil Ovan and Ed Williams are visiting automakers worldwide, persuading them to use their patented lead acid batteries -- equipped with carbon in lieu of metal -- instead of nickel-metal hydride and lithium-ion batteries.

Ovan declined to say which Detroit automakers he visited, but Firefly, a former division of Peoria-based Caterpillar Inc., has customers that include the U.S. Army and Husqvarna AB, the world's largest lawn equipment manufacturer.

Battery manufacturers are competing to cash in on the fast-growing hybrid vehicle segment. The industry is dominated by manufacturers of nickel-metal hydride batteries, though lithium-ion has promised to be a better option.

Until now, carbon was avoided in lead acid batteries because it created gases that shortened the battery's life. But four years ago, Kurt Kelley, then a Caterpillar research scientist, tinkered with a lead acid battery and a scrap piece of carbon foam leftover from another Caterpillar department.

"And voilÀ," Ovan said.

Firefly claims the battery is 70% lighter, recharges seven times faster and lasts two times longer than conventional lead acid batteries and that it is safer and costs less than today's hybrid electric batteries.

It's time to get tough on carbon emissions

The Scotsman
December 16, 2006

GAVIN McCRONE

THERE has been a remarkable increase in public awareness of the problems of climate change over the past six months. Clearly, the evidence is becoming more widely accepted.

Here in Scotland, the Scottish Environmental Protection Agency (SEPA) has found that the average temperature in Scotland is now 1 degree Celsius higher than in 1961, with the largest effect in south-east Scotland in winter. The number of days with air or ground frost has fallen by a quarter and the period of snow cover is reduced. The plant-growing season starts three weeks earlier in spring and ends two weeks later in the autumn. Rainfall is 20 per cent higher for the country as a whole, but with an increase of 60 per cent in winter for the north and west.

If this was all, it might not matter. The prospect of someday growing grapes in the Hebrides has its attractions. But the effects across the world could be calamitous, with increased threat of starvation in Africa, hurricanes in the Caribbean, water shortage in areas affected by drought and rising sea levels, as major icefields in Greenland and Antarctica melt.

If carbon emissions from energy production are to be reduced to a level that removes the threat of further climate change, some very tough decisions are going to have to be taken, and taken urgently.

There is no shortage of targets. The Scottish Executive's target for Scotland is to produce 40 per cent of its energy from renewable sources by 2020. The UK government has a target to reduce carbon emissions by 12.5 per cent on 1990 levels by 2012, and last summer's energy review proposed a reduction of 60 per cent by 2050.

The Stern review said that if carbon dioxide in the atmosphere was to be stabilised by 2050, a reduction of 60-75 per cent in carbon emissions from power generation worldwide would be required. But how are these targets to be achieved?

Scotland is at the forefront of some very interesting developments. A few weeks ago it was announced that a £24 million investment was to be made in a biomass plant to make combined heat and power from wood pellets at Invergordon. This follows a similar decision to build a £90 million plant at Lockerbie, also to make electricity from wood pellets. Such plants are carbon-neutral if the wood burnt is replaced by new forest growth.

Scottish and Southern Energy are to build a 350MW power station to make electricity from hydrogen at Peterhead. This will be a world first at this scale. It will manufacture hydrogen from natural gas, from which the carbon will be separated and sent by pipeline to the Miller field to increase the recovery of oil. By this means carbon emissions, compared with an ordinary power station burning natural gas, will be cut by 90 per cent.

Ocean Power Delivery, a firm based in Edinburgh, has a contract with a Portuguese consortium to build the world's first wave farm using its Pelamis machine. Three machines, built in Lewis, each generating 2.25MW, will be supplied initially with the prospect of further orders if the project is successful.

There is also an interesting small project in the Shetland island of Unst to make hydrogen from sea water using wind turbines. Hydrogen fuel cells will provide electricity when the wind drops, and when the wind is strong increased amounts of hydrogen can be made.

Wind turbines are now a common sight in Scotland, with effects on the environment that are not always welcome. About 600MW of capacity is installed and this is likely to at least double. But they suffer from two major defects.

The variable nature of wind means that their availability is unpredictable, averaging only about 50 per cent of capacity. It is therefore unsuitable for base load power. And some of the windiest locations now being considered involve substantial transmission costs, likely to make them uneconomic.

These developments give some indication of what a future energy system may be like. The Peterhead project may point the way to carbon sequestration on a much larger scale than could be applied to coal-fired power stations. Hydrogen, already used to power buses in Iceland and to be tried experimentally in London, could be developed as a major source of power for transport. But many of these technologies are still at a very early stage and there are many questions to be resolved, not least those of cost and reliability.

The Royal Society of Edinburgh's report, published last summer, pointed out that 90 per cent of Scotland's electricity is generated in five large power stations (see table). Two of these are due to close in the next five years. A third, Longannet, which is by far the largest, may be extended beyond 2020, if equipment is installed to remove the sulphur dioxide, as required by an EU directive to prevent acid rain. But it would still be a major source of carbon emissions.

So at least 2,400MW of new capacity is urgently required, if the economy is not to be put at risk, and twice this amount by 2020.

The more that renewable sources and energy saving can contribute the better, but investment in at least one or two new large plants seems inescapable. Left to market forces, this might be an additional gas-fired station. But, given that the UK is now a net importer of gas and there are questions about security of supply from Russia, it would seem that the choice ought to lie between coal and nuclear. Coal emits twice as much carbon as gas per kilowatt produced. But, if clean coal technology proves practical and if it can be made economic, it might be attractive. Nuclear has advanced a long way since the technology of the existing Scottish power stations. It provides 80 per cent of the power in France, which is among the cheapest in Europe. Decisions on the disposal of waste are essential and deep burial in caverns, as the Finns have decided on, seems the best option.

Nuclear power is likely to be less damaging for the world than coal, unless the latter involves clean coal technology. A decision cannot be put off much longer.

New mileage numbers aren't enough

LA Times
Editorial

The EPA promises to provide more accurate miles-per-gallon counts. But that won't change fuel standards overall.

December 17, 2006

AMERICAN DRIVERS will soon be able to confirm what they always suspected: Their cars aren't as fuel-efficient as those stickers in the windows say. But although the federal government is ready to give consumers more accurate information, it remains unwilling to use that information to demand better fuel efficiency in cars.

Federal standards require an automaker's fleet of passenger cars to average 27.5 miles per gallon. The industry meets that standard only because the Environmental Protection Agency calculates automobile averages using assumptions that are optimistic, to put it kindly.

Last week, however, the EPA revised its formula to reflect real-world driving conditions. As a result, the fuel-economy figures that consumers see on the window stickers of 2008 model cars will be on average 10% lower than the current ones. Gas-electric hybrids, criticized for delivering poorer gas mileage than advertised, will see a far steeper drop, about 25%. In addition, starting in 2011, the EPA will require guzzlers such as Hummers to have gas-mileage stickers, something from which they've been exempted on the fantasy that they were being used as commercial trucks.

These are all reasonable and welcome changes. But their effect will only be seen on the window stickers of new cars. That's because the more important fuel-efficiency rules, known as the CAFE standards (it stands for corporate average fuel economy), will remain unchanged.

CAFE standards require automakers to make more efficient cars instead of merely requiring them to disclose their cars' efficiency (or lack thereof). The Transportation Department calculates them using the EPA's figures. But the department calls the new and improved EPA figures an "adjustment," and it will use the old numbers to measure compliance with CAFE standards.

The EPA's new system isn't completely irrelevant. With fuel prices high and likely going higher, consumers will probably continue to seek out cars that get better gas mileage. And as consumers make choices based on more accurate numbers, automakers might feel pressured to produce more efficient cars. Or not. Despite the popularity of hybrids — which still get excellent gas mileage even if it's not as high as many drivers expect — many automakers have resisted producing cars with new technologies that could dramatically improve gas mileage.

The 27.5-mpg standard has been technologically feasible for decades. If the Transportation Department won't hold Detroit to higher standards, then Congress should by stepping in and telling it to use the EPA's more accurate numbers.

U.S. Fuel Tax Could Cut Emissions

San Francisco Chronicle
Craig Morris
Sunday, December 17, 2006

Gov. Schwarzenegger could take a lesson from Germany if he's really serious about attaining his tough, new air-quality goals.

In September, the governor signed into law the Global Warming Solutions Act, AB32, which stipulates that by 2020 the state will cut its emissions of greenhouse gases to 1990 levels, a 25 percent decrease from today's levels. Sounds good, but targets can be missed. The mechanisms to meet the targets are therefore crucial.

Germany found that one way to do that was to impose an "ecotax." To improve fuel economy, Germany simply raised the price of gas with this surcharge.

Countries like France, the Netherlands and Germany already charged around $6 per gallon, but Germany raised the price by an additional 10 cents a year from 1999 to 2003. Germans now pay nearly $6.50 per gallon. The increase was not steep (less than 2 percent per year), but it sent a signal to the market that gas would not be getting any cheaper.

No one told carmakers what to build or German consumers what to buy, but the announcement of small, gradual price increases allowed people to plan in a way that sudden shocks -- like the 50 percent increase in U.S. gas prices after hurricanes Katrina and Rita -- do not. Germans had time to react to higher prices by deciding to switch to a more fuel-efficient car, driving less, carpooling, taking public transit, cycling or walking. And those who wanted the thrill of driving a sport utility vehicle on the autobahn could still do so if they had the cash.

By 2004, fuel consumption had dropped by around 7 percent from 1999 levels; 6 percent more Germans were riding public transport; and cars with nearly 80 miles per gallon fuel efficiency hit the market. Yes, 80 mpg. That's not a typo; it's a Volkswagen Lupo. And unlike the two-seater Smart, with 69 mpg, the Lupo (like Audi's classy A2 with 78 mpg) is a four-seater.

Now compare the success of Germany's ecotax to American fuel-efficiency standards. The American standards, designed to raise the average mileage of new cars, basically tell automakers how to build cars. But the standards didn't increase average miles per gallon dramatically in the late 1970s and early 1980s, skyrocketing gas prices after two oil crises did. Once gas prices fell and remained low, the standards had little effect. In fact, the average fuel economy of all vehicles on the road has not moved much since 1987. The 1927 Ford Model A would meet today's fuel-efficiency standards.

Is anyone here watching Europe's success? Yes, Al Gore has been calling for a carbon tax for months. He wants to use the revenue to offset payroll taxes -- exactly what Germany has been doing since 1999. But when MSNBC reported on Gore's idea, it called it a "novel approach" -- no mention of Germany's success.

Of course, many Americans are calling for higher fuel-efficiency standards -- but that's the bad news. These standards are by their very design doomed to failure because efficiency can ironically undercut itself by making consumption cheaper. Think about it: if you could suddenly drive 100 miles longer on one tank of gas, would you drive less or more? When efficiency lowers consumption, demand for energy drops, lowering prices, which in turn undercuts investments in efficiency -- a catch-22 without price mechanisms.

Too bad Americans don't understand that higher prices are the solution.

Targets don't work if they are unrealistic. In 1990, California told automakers and consumers that it wanted 10 percent of the vehicles sold in the state by 2003 to be zero-emission, but the cars didn't sell in great enough numbers, and the project failed. Battery-powered cars leave much to be desired, and fuel-cell cars are still not ready for the market.

The Japanese have a more clever system of targets based on what industry demonstrates to be possible: the average efficiency is determined for a type of car, say four-door sedans, and the least-efficient products must be improved every year. That won't bring sudden, dramatic improvement, but over a few years, it would make a significant difference. Oh, did I mention that gas prices in Japan are nearly twice as high as in the United States?

Unfortunately, we don't look at Japan and Europe enough. Otherwise, we would have seen Japanese hybrids coming while we were still focused on zero-emission cars.

The press release for California's Global Warming Solutions Act calls it a "first-in-the-world comprehensive program." It also later states that the mechanisms to reach the target must be specified by Jan. 1, 2009. So California has set a target without mechanisms. I say: Forget about targets, stop acting like we are the world leaders, and start copying the mechanisms of those who are. America, it's time to play catch-up, not catch-22.

Craig Morris is the author of "Energy Switch: Proven Solutions for a Renewable Future." Contact us at insight@sfchronicle.com.

Spare Power Sufficient to Fuel Switch from Gas to Electric Cars

Scientific American
December 13, 2006

Existing U.S. power plants could provide enough juice to switch 84 percent of the 220 million American vehicles on the road from gasoline to electricity.

Rumors of the electric car's demise appear to have been greatly exaggerated, with so-called plug-in hybrids making the rounds from Los Angeles to Washington, D.C., along with the sporty, new all-electric Tesla Roadster on offer. Now a new analysis from the U.S. Department of Energy's Pacific Northwest National Laboratory (PNNL) offers more good news: existing electric power plants could fuel 84 percent of "light duty" vehicles if all 220 million cars and trucks converted to electric power overnight. "We're delighted to see solid third-party confirmation of what the people who know best--the utilities--have been saying for sometime," says Felix Kramer, plug-in hybrid owner/evangelist and founder of Calcars.org.

The analysis noted that the capacity of the U.S. power infrastructure is underutilized. Every evening--and during days of low demand--there is a large amount of spare capacity that could easily be tapped. By charging cars and trucks with electricity at night, American drivers could reduce the nation's dependence on foreign oil while potentially cutting power prices as well. "Since gasoline consumption accounts for 73 percent of imported oil, it is intriguing to think of the trade and national security benefits if our vehicles switched from oil to electrons," notes PNNL energy researcher Rob Pratt. "Plus, since the utilities would be selling more electricity without having to build more plants or power lines, electricity prices could go down for everyone."

The researchers specifically excluded power resources such as nuclear, hydroelectric, wind and solar as each of these already produce electricity at maximum capacity. Yet, plugging in our cars could reduce U.S. greenhouse gas emissions by an average of 18 percent. "Coal plants and gas plants are the marginal units that we considered for charging the plug-in hybrid batteries," says PNNL staff scientist Michael Kintner-Meyer, lead author of the forthcoming report. "Wherever you have a high dominance of natural gas, that is where you improve on the total greenhouse gas emissions."

Such a switch would have other pollution benefits as well, including radically reducing the amount of asthma-inducing particulate matter in the air of urban areas. Basically, the source of pollution is transferred: "It is far less expensive to capture emissions at the smokestack than the tailpipe," Pratt adds. And the report estimates that purchasing a plug-in hybrid--a premium of as much as $10,000--would pay for itself within five to eight years, depending on regional electricity prices.

"Nobody ever asks what's the payback on a sunroof," Calcar's Kramer notes. "People are buying the environmental feature, just like people buy leather seats or sunroofs." But consumers are not likely to get that option on a large scale in the immediate future. "They're still not being made and there's no immediate prospect of them being made," he adds. "Batteries are good enough now to put in cars and they're going to be even better by the time we're in production." Already, initial vehicles--and their outdated nickel batteries--have proven durable beyond 100,000 miles.

Kintner-Meyer predicts a total changeover could take as long as 25 years. In the meantime, technological improvements in things like batteries will likely make the case for such a transition even more persuasive. But the improvements are not only needed on the automotive side; such a switch would probably require smart chargers that would sense the appropriate times to refill the car's electric tank. And the grid would need improvement, too: "Some of the equipment is designed to cool down at night. If you are basically running at maximum capacity for the entire infrastructure, then you are burning the system," Kintner-Meyer says. "There needs to be some smartness in the charger of those plug-in hybrids that will sense emergencies in the grid and briefly interrupt the charging." Not to mention some smartness in deciding to go back to the future (electric cars outsold competitors at the turn of the last century) in short order.

GM, Nissan, Toyota Plugging In

Red Herring
December 25, 2006 Issue
By Jennifer Kho

You might want to find someplace else to charge that power drill. Announcements in the last few weeks by General Motors, Nissan, and Toyota suggest the next device you plug into the wall outlet could be your car. All three carmakers are pursuing so-called “plug-in hybrids,” gas-electric vehicles that owners can recharge for better mileage—in some cases getting more than 100 miles per gallon by replacing fuel with electricity.

The news was welcomed by plug-in hybrid advocates, who have long hoped a Big Five manufacturer would pursue the technology. “It’s a good step,” says Jodie Van Horn, coordinator of Plug In Bay Area, part of a national campaign in favor of plug-in hybrids.

General Motors made the first announcement November 29, saying it would produce a plug-in version of its Saturn Vue Green Line hybrid. “The technological hurdles are real, but we believe they are also surmountable,” said Rick Wagoner, CEO of GM, at the Los Angeles Auto Show. “I can’t give you a production date for our plug-in hybrid today. But I can tell you that this is a top-priority program for GM, given the huge potential it offers for fuel-economy improvement.”

The same day, Toyota Motor’s North America President Jim Press said plug-in hybrids will play “a starring role” in the auto industry in the 21st century. Toyota first said it was pursuing the technology in July, but hasn’t yet committed to producing one. Then, last Monday, Nissan Motor[s?] announced it would accelerate the development of plug-in hybrid technology as part of its new mid-term environmental action plan. Plug-ins are regular gas-electric hybrids that have been outfitted with extra battery power and a plug so owners can replace some fuel with electricity to extend mileage.

None of the companies has set a timeline for bringing plug-in hybrids to the market, and all referred to research still needed before that can happen. The lack of a definite plan has triggered some grumbling among plug-in hybrid advocates. After all, startups such as EnergyCS and Hymotion—and nonprofit groups like CalCars.org—already have converted some Toyota Prius hybrids into plug-ins, so why should car manufacturers have technology issues? “Our contention is that the time is now; the technology is ready today,” Ms. Van Horn says.

But some doubt plug-ins are ready for prime time. Dan Benjamin, a senior analyst at ABI Research, says battery life and cost are still big issues. “That’s not to say it won’t happen; it’s just not imminent,” he says. According to a U.S. Department of Energy report released last Monday, plug-in hybrids are expected to cost about $6,000 to $10,000 more per vehicle than regular hybrids. In addition, plug-in hybrids take too long to charge (usually overnight) and require a lot of batteries to get beyond the 100-mile range, Mr. Benjamin says.

These could be daunting challenges in a climate where sales of regular gasoline-electric hybrids dropped 31 percent from August to November, according to Edmunds.com. The research outfit blamed falling gasoline prices and reduced federal tax credits for the decline in sales of best-selling brands.

Still, advocates remain undaunted. Felix Kramer, president of CalCars, says he expects additional U.S. federal tax credits to be approved in the next year that would encourage more motorists to buy hybrids. He also argues that charging a car overnight isn’t too long, and that a 20- to 40-mile range is plenty. “There’s not much reason to go beyond that,” he says. “That’s the whole point of [plug-in hybrids].”


Until manufacturers are satisfied, though, you can probably leave the drill plugged into the garage outlet a little longer.

CEOS want increase in fuel-efficiency standards

Detroit Free Press

By JUSTIN HYDE
FREE PRESS WASHINGTON BUREAU

December 13, 2006

A group of corporate chief executives and former military generals called Wednesday for the federal government to raise fuel economy standards and take other steps toward cutting U.S. oil imports almost in half from today’s levels by 2030.

The group, the Energy Security Leadership Council, includes the chief executives of FedEx, UPS, Dow Chemical and top executives from Southwest Airlines and Goldman Sachs, along with several retired U.S. military commanders. They contend U.S. reliance on foreign sources of energy gives enemies in other parts of the world too much leverage over the U.S. economy.

“We’re now far more vulnerable than we were in the ‘70s,” said Robert Hormats, vice chairman of Goldman Sachs’ international unit. “The disruption that could occur…could be extremely serious.”

Their main proposal would require federal regulators to consider a 4% annual increase in fuel economy standards for cars and trucks. Those increases could be put off if regulators found the industry couldn’t meet them. The group also proposed fuel-efficiency standards for heavy-duty trucks, as well as more incentives for alternatives to oil such as ethanol.

The Pernicious Price of Petroleum

Wired Magazine
By John Gartner
02:00 AM Dec, 13, 2006

Our love of driving is killing us. While we think of car crashes as causing fatalities, the production and transportation of fuel also significantly undermines public health.

In his book Lives Per Gallon: The True Cost of Our Oil Addiction, Terry Tamminen outlines the direct and indirect impact that petroleum consumption has on millions of Americans every year.

Tamminen, a former secretary of the California Environmental Protection Agency, spoke with Wired News about how we got into this mess, who is to blame, and his state's current efforts to hold energy providers and the auto industry responsible for their environmental impact.

Wired News: How many casualties do petroleum products cause each year?

Terry Tamminen: Nationally about 100,000 people die every year from preventable air pollution, and another 6.5 million go to the hospital with respiratory and other diseases related to smog and polluted air. But that's probably just the tip of the iceberg, as many people die of heart disease or heart attacks caused by hearts or lungs strained by air pollution and restricted airways.

People outside of the U.S. also pay for our oil addiction because of the damage done to their environment at the sites where oil is drilled. There are entire villages where the tribes were decimated because there was virtually no environmental regulation, and oil pipelines broke and huge fires swept up communities.

Also, many people die in conflicts over oil rights as local rebels and warlords fight to get oil companies out of these places through kidnappings and terrorism. And then there's the military lives we expend when trying to protect our oil interests in places like Iraq.

WN: You pin most of the blame on the auto and oil companies for polluting our skies, but aren't we free to choose our vehicles and how we use them?

Tamminen: We are not blameless as we do ... drive cars when we could walk or take a bike. But consumers haven't really had a choice because they didn't have accurate information about the health risks. Much like the tobacco industry responded to pressure from regulators about the dangers of smoking by forming the Tobacco Institute, the automobile industry formed an alliance to study the health impact of their products, but it was really an organization created to produce bogus studies and conspire to hide the truth.

The auto industry worked to stall the science that could reduce pollution by saying that it was too expensive or technically impossible. This delayed the introduction of catalytic converters and the removal of leaded gasoline and has kept the CAFE (corporate average fuel economy) standards from changing. Today we continue to overpay in "lives per gallon" because the auto industry pushes high octane gasoline which requires more energy to produce but provides no benefit to most of the vehicles on the road.

Consumer choice has been reduced by companies including General Motors, Standard Oil (which later became ExxonMobil) and Firestone Tires, which conspired to eliminate the clean electric trains that were being used for mass transit around the country. During the 1940s and 1950s, these companies created the National City Lines, a shell company that bought up the local clean electric transit systems and tore up the tracks so that no one else could ever use them. The companies replaced the trains with dirty diesel buses and encouraged people to buy cars. The group was eventually found guilty in federal court for anti-trust violations, but it was too late to do anything about it.

WN: Are there auto or petroleum companies that stand out as being either more or less responsible for the damage to public health?

Tamminen: As I've said, GM has historically been a bad actor. Currently in California the Alliance of Automobile Manufacturers is trying to block CA 1493 that requires the California Air Resources Board to regulate greenhouse gas emissions. Honda is the only major auto manufacturer that did not join the lawsuit.

This past summer in California there was a summit with Gov. (Arnold) Schwarzenegger and Prime Minister Tony Blair of England and 30 CEOs from around the world regarding reducing greenhouse gases, and it was encouraging that Shell and BP are embracing the idea. Chevron and ExxonMobil have been noticeably absent in the discussion of reducing greenhouse gases and led the fight against the failed Proposition 87, which would have created a tax on oil profits that would be invested in alternative energy. Shell and BP were not part of that consortium, so some actors are worse, and some are better.

WN: Plug-in hybrids and electric vehicles are touted as being more environmentally friendly. Is using natural gas and coal to generate the necessary electricity worthwhile from a health perspective?

Tamminen: When doing the "well to wheel" analysis, there is an enormous quantity of energy to extract oil and turn it into anything useful, transporting it, and getting it into your car, and we are going to have to work even harder to get oil in the future. Coal-fired electricity or hydrogen is cleaner and safer, because you don't have to go anywhere else in the world or kill anyone to get it. There are a lot of problems with coal, don't get me wrong, but I don't remember any time when coal has landed on a beach and killed birds and fish and destroyed entire economies.

WN: You support the recent lawsuit in California that asks for damages from automakers for their vehicles' greenhouse gas emissions. Couldn't the auto companies use the defense that they were always in compliance with the regulations of the state's Environmental Protection Agency?

Tamminen: Regulators can't regulate when they are consistently lied to and when alternatives are taken off the market. The auto companies were sued by California's attorney general for creating a nuisance. State and federal nuisance laws say you have the right to abate a nuisance. For example, if you live next to restaurant and the smoke from the grill comes streaming into your window, which may be totally legal but still creating a nuisance. For car companies, we know that it is possible to abate this nuisance.

Race to the Moon for Nuclear Fuel

Wired Magazine
By John Lasker
02:00 AM Dec, 15, 2006

NASA's planned moon base announced last week could pave the way for deeper space exploration to Mars, but one of the biggest beneficiaries may be the terrestrial energy industry.

Nestled among the agency's 200-point mission goals is a proposal to mine the moon for fuel used in fusion reactors -- futuristic power plants that have been demonstrated in proof-of-concept but are likely decades away from commercial deployment.

Helium-3 is considered a safe, environmentally friendly fuel candidate for these generators, and while it is scarce on Earth it is plentiful on the moon.

As a result, scientists have begun to consider the practicality of mining lunar Helium-3 as a replacement for fossil fuels.

"After four-and-half-billion years, there should be large amounts of helium-3 on the moon," said Gerald Kulcinski, a professor who leads the Fusion Technology Institute at the University of Wisconsin at Madison.

Last year NASA administrator Mike Griffin named Kulcinski to lead a number of committees reporting to NASA's influential NASA Advisory Council, its preeminent civilian leadership arm.

The Council is chaired by Apollo 17 astronaut Harrison Hagan "Jack" Schmitt, a leading proponent of mining the moon for helium 3.

Schmitt, who holds the distance record for driving a NASA rover on the moon (22 miles through the Taurus-Littrow valley), is also a former U.S. senator (R-New Mexico).

The Council was restructured last year with a new mission: implementing President Bush's "Vision for Space Exploration," which targets Mars as its ultimate destination. Other prominent members of the Council include ex-astronaut Neil Armstrong.

Schmitt and Kulcinski are longtime friends and academic partners, and are known as helium-3 fusion's biggest promoters.

At the Fusion Technology Institute, Kulcinski's team has produced small-scale helium-3 fusion reactions in the basketball-sized fusion device. The reactor produced one milliwatt of power on a continuous basis.

While still theoretical, nuclear fusion is touted as a safer, more sustainable way to generate nuclear energy: Fusion plants produce much less radioactive waste, especially if powered by helium-3. But experts say commercial-sized fusion reactors are at least 50 years away.

The isotope is extremely rare on Earth but abundant on the moon. Some experts estimate there a millions of tons in lunar soil -- and that a single Space-Shuttle load would power the entire United States for a year.

NASA plans to have a permanent moon base by 2024, but America is not the only nation with plans for a moon base. China, India, the European Space Agency, and at least one Russian corporation, Energia, have visions of building manned lunar bases post-2020.

Mining the moon for helium-3 has been discussed widely in space circles and international space conferences. Both China and Russia have stated their nations' interest in helium-3.

"We will provide the most reliable report on helium-3 to mankind," Ouyang Ziyuan, the chief scientist of China's lunar program, told a Chinese newspaper. "Whoever first conquers the moon will benefit first."

Russian space geologist Erik Galimov told the Russian Izvestia newspaper that NASA's plan to colonize the moon will "enable the U.S. to establish its control of the global energy market 20 years from now and put the rest of the world on its knees as hydrocarbons run out."

Schmitt told a Senate committee in 2003 that a return to the moon to stay would be comparable "to the movement of our species out of Africa."

The best way to pay for such a long-term mission, he said, would be to mine for lunar helium-3 and process it into a fuel for commercial fusion .

In a 1998 op-ed for Space News, Schmitt criticized the 1979 United Nations- sanctioned Moon Treaty, which forbids ownership of lunar territory by individuals or separate nations.

"The mandate of an international regime would complicate private commercial efforts," Schmitt wrote. "The Moon Treaty is not needed to further the development and use of lunar resources for the benefit of humankind -- including the extraction of lunar helium-3 for terrestrial fusion power."

Schmitt declined to comment for this article. But Kulcinski said their lunar helium-3 research is entirely separate from their NASA duties.

"The NAC is purely an advisory council to Dr. Griffin," he said. "It has very broad responsibilities dealing with science, exploration, human capital, education and operations, to name a few. Our appointments to this advisory committee have nothing to do with our specific research interests."

Kulcinski has been studying helium-3 fusion for more than 20 years. When his UW fusion team realized 15 years ago that helium-3 could be extracted from lunar soil, he called it a "rediscovery."

For years Kulcinski tried to convince NASA and the U.S. Department of Energy that they should take lunar helium-3 seriously and invest in its research, but was rebuffed, he said.

But NASA's "Global Exploration Strategy" (.xls) for the moon now states that among the 200 potential goals for future missions includes the study of lunar helium-3 for "fusion reactors on Earth" to "reduce Earth's reliance on fossil fuels."

However, there are those who doubt helium-3 could become the next super fuel.

Jim Benson, founder of space contractor SpaceDev, which helped build SpaceShipOne's engine and is a subcontractor of the Missile Defense Agency, said mining the moon for helium-3 doesn't pass the "net energy analysis" test. It would require more energy to retrieve helium-3 and bring it back than it would yield.

Just, sending mining equipment to the moon, and then returning processed helium-3 back to earth, would cost billions in rocket fuel, said Benson.

"We just don't have a need for helium-3," he said. "It's not practical."

SANTA CLAUS IS CHINESE: Why China Is Rising and the United States Is Declining

Earth Policy Institute
Eco-Economy Update
Embargoed for Release
11 am EST, December 14, 2006

Lester R. Brown


I know Santa Claus is Chinese because each Christmas morning after all the gifts are unwrapped and things settle down I systematically go through the presents to see where they are made. The results are almost always the same: roughly 70 percent are from China. After some research, it seems that my one-family survey is representative of the country as a whole.


Let’s start with toys. Some 80 percent of the toys sold in the United States—from Barbie dolls to video games—are made in China. Talking toys that speak English learned the language from Chinese workers. Electronic goods—from Apple’s iPod to Microsoft’s Xbox—are made in China. Clothing—from the latest cashmere sweaters to gym suits—is also likely to have a “Made in China” label.


The Christmas tree itself may come from China. While real Christmas trees are grown in every state in the United States and are marketed locally, many families now gather around artificial Christmas trees. Eight out of every 10 artificial Christmas trees sold in the United States are made in China. Last year Americans spent over $130 million on plastic Christmas trees from China.


This year Americans will spend over $1 billion on Christmas ornaments from China. And in perhaps the greatest irony of all, even nativity scenes are made in China. Last year Americans spent more than $39 million buying nativity scenes shipped in from the East. China’s success in attracting foreign investment capital and mobilizing this huge workforce has made it the workshop of the world.


That the U.S. Christmas is made in China is a metaphor for a far deeper set of economic issues affecting the United States. Today Christmas is celebrated in both the United States and China—but for different reasons and with far different economic consequences. For the Chinese, the manufacturing bonanza means record profits, rising incomes, and, in a society where people save some 40 percent of their income, a sharp jump in savings. In the United States, Christmas shopping expenditures, headed for another record high this year, contribute to rising credit card debt and a soaring trade deficit.


Underneath the American Christmas spirit and good cheer is a debt-laden society that appears to have lost its way, marred in the quicksand of consumerism. As a society, we seem to have forgotten how to save so we can invest in a better future. Instead of leaving our children a promising economic future, we are bequeathing them the largest debt burden of any generation in history.


At the personal level, credit card debt just keeps climbing, and at the government level, we have the largest deficit in history. At the international level, we have a trade deficit that moves to a new high month after month.


It’s not the fact that our Christmas is made in China, but rather the mindset that has led to it that is most disturbing. We want to consume no matter what. We want to spend now and let our children pay. It is this same mindset that introduces tax cuts while waging a costly war. Economic sacrifice is no longer part of our vocabulary. After the Japanese attack on Pearl Harbor, President Roosevelt banned the sale of private cars in order to mobilize the manufacturing capacity and engineering skills of the U.S. automobile industry to build tanks and planes. In contrast, after 9/11, President Bush urged us to go shopping.


In the United States we are so intent on consuming that personal savings have virtually disappeared. We have an average of five credit cards for every man, woman, and child. Of the 145 million cardholders, only 55 million clear their accounts each month. The other 90 million cannot seem to catch up and are paying steep interest rates on their remaining balance. Millions of people are so deeply in debt that they may remain indebted for life.


The official national debt, the product of years of fiscal deficits, now totals $8.5 trillion—some $64,000 per taxpayer. (See data at www.earthpolicy.org/Updates/2006/Update62_data.htm.) By the end of the Bush administration in 2008, this figure is projected to reach a staggering $9.4 trillion. We are digging a fiscal black hole and sinking deeper and deeper into it.


Each month the Treasury covers the fiscal deficit by auctioning off securities. The two leading international buyers of U.S. Treasury securities are Japan and China. In this role, China is now also becoming our banker. This developing country, where income levels are one sixth those of the United States, is financing the excesses of an affluent industrial society. What’s wrong with this picture?


In times past, when our fiscal deficits were covered largely by U.S. lenders, interest payments on the debt were reinvested in the United States. Now they are flowing abroad to Japan, China, and other foreign holders of U.S. debt.


While the U.S. fiscal deficit, driven partly by the war in Iraq, soars to stratospheric levels, the country is facing an unprecedented fiscal challenge as the baby boomer generation retires, pushing up the costs of social security, Medicaid, and Medicare. This, combined with the growing interest payments on our debt to China and other countries, will put a nearly impossible tax burden on the next generation—something for which they may never forgive us.


The U.S. trade deficit is growing by leaps and bounds, nearly doubling from $452 billion in 2000 to an estimated $850 billion in 2006. Rising oil imports and the trade deficit with China account for over half of it.


National policy failures such as not adequately supporting the use of renewable energy technologies have contributed to the growing U.S. trade deficit. For example, the United States should be a leading manufacturer and exporter of solar cells and wind turbines, but it has fallen behind both Europe and Japan. The solar cell, invented at Bell Labs in 1954, is an American technology. But the U.S. effort to develop solar energy was so weak and sporadic that both Germany and Japan forged ahead and developed robust solar cell manufacturing and export industries.


The situation is similar with wind. Although the modern wind industry was born in California at the beginning of the 1980s, the U.S. failure to sustain support for wind resource development allowed European countries to largely take over this industry.


Even though rising oil imports are widening our trade deficit, we consume oil with abandon, weakening the economy and undermining our political independence.


We have lost influence in world financial markets simply because of our mounting debt, much of it held by other countries. If China’s leaders ever become convinced that the dollar is headed continuously downward and they decide to dump their dollar holdings, the dollar could collapse.


Beholden to other countries for oil and to finance our debt, the United States is fast losing its leadership role in the world. The question we are facing is not simply whether our Christmas is made in China, but more fundamentally whether we can restore the discipline and values that made us a great nation—a nation the world admired, respected, and emulated. This is not something that Santa Claus can deliver, not even a Chinese Santa Claus. This is something only we can do.


# # #


Lester R. Brown is President of the Earth Policy Institute and author of Plan B 2.0: Rescuing a Planet Under Stress and a Civilization in Trouble.


Data and additional resources at www.earthpolicy.org


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