Government

Political Rallies in Hilo & Honoka’a

We attended a large, two-part political rally this weekend. The first part was held at ‘Imiloa Astronomy Center in Hilo, and the second at a school cafeteria at Honoka‘a. We were asked to set up a display of our vegetables at both places.

Highlights were:

  • Senator Inouye’s powerful support for gubernatorial candidate Neil Abercrombie
  • Senator Akaka’s singing of the song “Where I live there are rainbows,” and
  • Neil Abercrombie’s emotional speech talking about how our diversity is what unites us, not divides us.

The main people in attendance were Senator Inouye and Senator Akaka, Representative Maizie Hirono, Neil Abercrombie and Lieutenant Governor candidate Brian Schatz. Also present were Senator Russell Kokubun and Representatives Jerry Chang, Faye Hanohano, Clift Tsuji, Cindy Evans and Mark Nakashima.

Mayor Billy Kenoi introduced the speakers at ‘Imiloa, and Senator Dwight Takamine introduced them at Honoka‘a.

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Neil Abercrombie has a very quick wit and strikes me as a really good guy. This is Tracy and Kimo with Neil and I.

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In the next photo, that’s June and Maizie Hirono. I grumbled at Maizie’s chief of staff, Anne Stewart, about why geothermal was not mentioned in her campaign ad. Anne said it was inadvertent; because the folks who did the ad were separate from the campaign.

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This is a picture I’ve wanted to capture for many years. It is of Senator Dan Inouye, President Pro Tem of the United States Senate, and Monty Richards, national officer of the Republican Party. These two men have been partners in the effort to transition Hawai‘i’s agriculture after sugar’s demise in the early 1990s. Monty, a knowledgeable farmer and rancher, worked with Senator Inouye to develop and administer the Regional Economic Transition Assistance Hawaii program (RETAH). They are good friends and often kid each other about belonging to the opposite political party.

They worked together to make the transition happen. And they were successful. Today ag is worth more than it was when the plantations shut down.

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Governor candidate Neil Abercrombie and Lt. Governor Candidate Brian Schatz at the Honoka‘a rally. Senator Inouye gave a powerful endorsement of Neil Abercrombie.

Abercrombie gave a rousing and emotional speech about unity, trust and hopefulness. I had never felt so much emotion run through a room after a political speech as I heard then.

It made me feel like we are absolutely going to be successful in getting geothermal on line as the primary base power for the Big Island. At one point, I glanced over at Mayor Kenoi and felt like we were thinking the same thing, at the same time, about geothermal: “Not, no can. CAN!” And it made me feel that it will happen for the right reasons – because it is the right thing to do for the “rubbah slippah folks.”

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Hamakua Springs set up a display as part of the festivities at the ‘Imiloa rally, as well as the one at Honoka‘a.

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Bob Stanga had a nice assortment of the mushrooms they grow.

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Roger Hirako and some of the best of his Kamuela Grown products.

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Keeping the kids occupied.

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Peak Oil

The Impending World Energy Mess

I bought Bob Hirsch’s book The Impending World Energy Mess at the Peak Oil conference. If you want to understand why we will have an oil crisis in two to five years, this is the book to read.

Energybulletin.net wrote about the book:

James Schlesinger, President Carter’s Energy Secretary, wrote the foreword to a book written by Dr Robert Hirsch, an former US official who predicts a fall of the oil production within 5 years.

Never before has a high-ranking political figure like Schlesinger given his support to such a prognosis. The book will be published in the US on October the 1st. Here is an exclusive interview with its author.

Dr. Robert Hirsch has a unique place in the ‘peak oil’ issue. Back in 2005, he was the main author of the first pessimistic report ever published by a public administration (presentation on Wikipedia).

Not just any public administration : the Department of Energy of President George Bush.

Robert Hirsch has been a manager of petroleum exploratory research at Exxon, a senior staff member at the RAND Corporation, and director of the US research program on nuclear fusion energy.

His 2005 conclusions did not get any attention from the mainstream or financial media.

Today, Robert Hirsch perseveres. According to him, it’s now obvious: we will soon face a decline of world black gold supplies.

They also published an interview with Robert Hirsch:

Bob Hirsch: In years past, there was considerable uncertainty in my mind about when the decline of world oil production might begin. Recently it became clear to me that it’s going to be sooner rather than later. I believe that the onset of the decline of world oil production is likely in the next two to five years. And when I say “oil,” I mean all liquid fuels.

Our thinking is that what happened in the two sudden oil shocks of 1973 and 1979 is very likely to be repeated when oil decline sets in. Those were two real world examples of oil shocks surprising people and causing panic. We believe that the same kind of thing is going to happen again, except that the problem is going to last much, much longer because, unlike before, there will be no unused oil supply valves to turn on this time. Read more

Geothermal

Big Island Geothermal Projects Drawing Much Interest

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More and more people are looking into the possibility of doing geothermal projects. Mililani Trask and the Honolulu-based Innovations Development Group, a Native Hawaiian renewable-energy development firm, are interested in pursuing a geothermal model that benefits the local community, not only the developer. They have been doing just that in New Zealand.

Ku‘ulei Kealoha Cooper-Springer, trustee of the Kealoha Estate, told me that Jimmy and Miulan Kealoha, her grandma and grandpa, told her many, many years ago that she should pursue geothermal. She said the trust has 89 acres in the geothermal subzone, and that now the time seems to be right.

I have spoken with a representative of another group that is very interested, too, as well as another landowner.

If HELCO were ready to purchase geothermal power, many people would step forward right now.

There has been a major change in how geothermal is perceived by the native Hawaiian community, compared to in the 1970s, when it was done in a heavy-handed, “top-down” manner. The old technology that existed in the 1970s has been replaced by much safer production methods. Puna Geothermal has been in operation for many years now as a good neighbor.

And the world around us has changed since then. The evidence is everywhere – it’s indisputable – that oil will soon start to decline, and that we must find alternatives to fossil fuel oil. The cost of electricity made with fossil fuel oil will rise with increasing oil prices. And it will be the poor folks whose lights will be turned off first. Too often, those folks will be native Hawaiian.

Geothermal is the cheapest form of “base power.” Base power is approximately 85 percent of the electric utility’s needs – it’s the dependable power that prevents our lights from flickering. Geothermal gives off no greenhouse gases, and it has a small footprint compared to solar and biofuels.

And off-peak geothermal power, which would otherwise be wasted, can be used to make H2 and NH3 for use in internal combustion engines. All that takes is electricity, water and air. We have everything we need right here in Hawai‘i to help future generations.

The tide is turning.

Peak Oil

Platts News Service Reports on the Peak Oil Conference

When I attended the Association for the Study of Peak Oil and Gas (ASPO USA) Conference in Washington, D.C. last week, I happened to be sitting next to the reporter for Platts News Service, Leslie Moore Mira.

Here are two reports she wrote about the conference, which sum things up well:
Peak oil panel debates severity, timing of potential crisis
Washington (Platts)–7Oct2010/553 pm EDT/2153 GMT

A panel of geologists and energy analysts debated Thursday the severity and timing of an anticipated oil crisis, with one saying during a Washington briefing that crude oil production has now peaked.

“The global rate of production of oil is peaking now,” said Tad Patzek, professor and chairman of the department of petroleum engineering at the University of Texas-Austin. “The size of accumulation [of oil] is not equated to the rate of production,” he said.

Frank Rusco, an energy director at the US Government Accountability Office, estimated some 45 years of “proven reserves,” though current and future oil demand will stress supplies.

“Higher oil prices can retard economic growth and even cause a recession in the right circumstance,” Rusco said at the briefing, which was organized by the Association for the Study of Peak Oil & Gas. He declined to say after the briefing what a gasoline price ceiling might be for US consumers.

“The remaining hydrocarbons will be more costly to get from underground,” from a “policy perspective,” Rusco said, citing the Middle East as a “fairly unstable” region.

Robert Hirsch, an energy adviser at MISI and former manager of Exxon’s synthetic fuels research laboratory, put the state of looming shortages in more dire terms, saying “in the next two to five years oil shortages will get deeper and deeper.”

Meanwhile “mitigation” of oil dependency by transitioning into other energy sources will take upward of a decade to come into play.

“Some time after a decade, mitigation will take impact and things will start to flatten out,” Hirsch said.

GHAWAR COULD MORPH INTO A CANTARELL: PROFESSOR
New reserves from Brazil and production from unconventional sources in the US will not be enough to compensate for depleting reserves, panelists said.

The Ghawar oil field in Saudi Arabia, still a bright light in the
petroleum world, could see a sharp and imminent decline in production, Patzek said.

If Ghawar “peters out, to replace it [with production elsewhere] will be a very difficult task,” he added. He estimated Ghawar’s current production at between 4.5 million-5 million b/d, though added that actual production figures are unknown as they are a “top secret.”

Later on the sidelines, Patzek said Ghawar could become the region’s Cantarell, referring to Mexico’s offshore oil field that has seen production plummet by over half from a peak 2.1 million b/d in the mid-2000s.

Patzek said that the ongoing water-flood efforts into the Ghawar field to stimulate production will eventually taper off. “You’re injecting twice as much water into the well,” he said. “Your field is watering out,” Patzek said in an interview.

Patzek told the briefing that that Norway’s reserves have peaked, while he characterized the decline rate in the US Gulf of Mexico as “very high.” BP’s Thunder Horse well in the Gulf “has not reached its potential and it’s declining faster than people thought,” Patzek said.

A BP spokesman was not immediately available for comment on Patzek’s remarks about Thunder Horse.

– Leslie Moore Mira, leslie_moore@platts.com

Collapse then surge predicted for oil prices at peak oil meeting
Washington( Platts)–11Oct2010/415 am EDT/815 GMT

A looming collapse in credit markets and liquidity could lead to wildly gyrating prices for crude oil within the next five years, with prices falling to $20/barrel, then possibly rocketing to $500/b, a peak oil theorist and commentator told the Association for the Study of Peak Oil and Gas conference.

“This is not a recovery that we’re in,” said Nicole Foss, a former fellow at the Oxford Institute for Energy Studies, who predicted “chaos” in foreign currency and equity markets within years. A severe deflationary plunge will contribute to a liquidity crisis among the financial sector, Foss said on a peak oil panel late last week. The meeting in Washington wrapped up Saturday.

“Oil will bottom early in this depression,” Foss said. She and fellow
panelist, energy analyst Chris Martenson, predicted that foreign currency markets will become more volatile, with domino effects on global money supply.

“It’s not unthinkable that the US will have another financial crisis,”
Martenson said, adding that he gave the US a “50%” shot at having a fiscal crisis and a “50%” chance of experiencing a currency crisis. “We’re going to see severe dislocations in the foreign exchange markets.”

“Deflation is tomorrow’s problem,” Foss said, adding that a lack of
purchasing power will undermine price support for crude oil. Then “printing [money] is a few years off,” she said. “We could see $20/barrel and then $500/barrel within the space of five years,” Foss said.

Foss runs the Agri-Energy Producers’ Association of Ontario, where she has focused on farm-based biogas projects and grid connections for renewable energy. At Oxford, she researched electricity policy at the EU level, according to her website. She was previously editor of the Oil Drum Canada, where she wrote about peak oil and finance.

Speaking on the sidelines of the conference, Foss said that natural gas holds no promise as a safe hydrocarbon haven in a scenario of volatile crude oil prices. There is a “perception of a glut” of natural gas reserves and other resources from new shale plays and coalbed methane, and tight formation gas, Foss said.

“I would argue that this is an illusion,” Foss said. The environmental cost of extracting unconventional resources “is tremendous,” Foss said, adding that the energy resource “bang for buck” is unappealing. “We’ll end up with natural gas price spikes,” after years of low natural gas prices, she said.

As a side event to the meeting, a panel of geologists and energy analysts debated at a Congressional briefing the severity and timing of what they believe will be an oil crisis, with one saying crude oil production has now peaked.

“The global rate of production of oil is peaking now,” said Tad Patzek,professor and chairman of the department of petroleum engineering at theUniversity of Texas-Austin. “The size of accumulation (of oil) is not equatedto the rate of production.”

Frank Rusco, an energy director at the US Government AccountabilityOffice, estimated that there are some 45 years of “proven reserves,” thoughfuture oil demand will stress supplies. “Higher oil prices can retard economicgrowth and even cause a recession in the right circumstance,” Rusco told thebriefing. He declined to say after the briefing what a threshold gasoline
price might be for US consumers.

“The remaining hydrocarbons will be more costly to get from underground,” from a “policy perspective,” Rusco said, citing the Middle East.

Robert Hirsch, an energy adviser at MISI and former manager of
ExxonMobil’s synthetic fuels research laboratory, put the state of looming shortages in more dire terms, saying “in the next two to five years oil shortages will get deeper and deeper.”
Meanwhile, the “mitigation” of transitioning into other energy sources will take upward of a decade to come into play. “Some time after a decade, mitigation will take impact and things will start to flatten out” on the demand side, Hirsch said.

-Leslie Moore Mira, leslie_moore@platts.com

Peak Oil

At the Peak Oil Conference 2010

I’m at the Peak Oil Conference in Washington, D.C.

This is my third ASPO conference. By now, I know most of the main players.

From left to right: My friend Gail Tverberg, editor at The Oil Drum; Jeff Rubin, former chief economist of CIBC world markets; me, and Debbie Cook, former Mayor of Huntington Beach, CA and board member of ASPO-USA.

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This is Chris Martenson on the left, the author of The Crash Course, and David Murphy, author of Energy Return on Investment, on the right. It was nice to talk story with David about EROI and geothermal.

I am really pleased that State of Hawai‘i’s Department of Business, Economic Development & Tourism sent Tim Ming their staff economist. He really gets it.

Current Affairs, Food Security, Government

Farmers Not In Favor of Pasha Entering Inter-Island Barge Service

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From the Star-Advertiser article:

Pasha gets PUC approval for interisland shipping
By Star-Advertiser staff

POSTED: 01:30 a.m. HST, Sep 21, 2010

The Public Utilities Commission has authorized Pasha [Hawaii Transport Lines LLC] to operate between Honolulu, Kahului, Hilo, Nawiliwili, Barbers Point and Pearl Harbor through Dec. 31, 2013. The commission will then evaluate the effects of the service and make a final decision on the company’s request to operate in the market permanently.

Young Bros. argued that Pasha will only serve the biggest ports and the most lucrative lines such as autos, heavy equipment and construction materials. Young Bros. also said that Pasha will “cherry-pick” the most lucrative routes and could harm local farmers and cattle ranchers who receive discounts subsidized by higher rates on other goods…. Read more

I think that allowing Pasha to operate in the inter-island barge service, without forcing them to provide the same services that Young Brothers provides, will jeopardize Hawai‘i’s food security.

Young Brothers gives locally grown products a 30 percent discount. They are not forced to do it; they worked with farmers to come up with that rate. And Young Brothers services the ports at Moloka‘i, as well as Lana‘i. Pasha will not be servicing those ports, nor moving agricultural products.

Farmers know that food security involves farmers farming. And that if farmers make money, farmers will farm. Young Brothers helps farmers to make money.

It is clear to us that if Young Brothers’ profitability is at stake, they will be forced to rethink the farmers’ discount. That is not good for farmers.

Farmers are not in favor of allowing Pasha to unfairly compete with Young Brothers.

Biofuel, Geothermal, Renewable Energy Sources

Why We Need Geothermal

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I just returned from Detroit, where I attended the NH3 conference.

NH3 is ammonia, and it’s “the only realistic energy solution that makes sense,” according to Matt Simmons of the National Petroleum Council, the Council on Foreign Relations and founder of the Ocean Energy Institute.

Guy Toyama, chair of the Hawaii County Energy Commission; Mitch Ewan, of the Hawaii Natural Energy Institute at UH Manoa; Roald Marth, venture capitalist, and I were the others from Hawai‘i who attended. Guy gave a talk and pretty much convinced them to hold next year’s conference on the Big Island.

What I learned:

• NH3 is more practical than H2, because there are three Hs in its molecule, rather than two. Therefore, it’s a third more energy dense when transporting. And it can be moved around through the propane infrastructure at relatively low temperature and pressure.

I am a farmer and I like things that are practical. NH3 is the practical person’s hydrogen. H2 is very impractical.

• With a little help, NH3 can be used to run internal combustion engines without much modification. The largest company in the world that converts engines for propane use is now working on commercially modifying engines so that they can use NH3. They focus on fleet vehicles, like BlueBird school buses, etc.

I like this company’s approach. They take care of everything so it is simple for the operator.

• Rather than using hydrocarbons to make NH3, as is done now, we can use electricity for hydrolysis to separate out the hydrogen and oxygen from plain water; then take “N” (nitrogen) from the air to make NH3. Cheap electricity from “off peak” geothermal power would make this cost-competitive as oil prices rise. Considering the recent Lloyd’s of London white paper telling its business clients to be prepared for $200/barrel oil by 2013, it is prudent to be self-reliant.

So the ingredients for NH3 are:

  • Geothermal for cheap electricity
  • Water for the hydrogen, and
  • Air for the nitrogen.

We have all that in abundant supply on the Big Island.

NH3 does not burn well by itself, so it can be used to stretch hydrocarbons to hedge our bets. This conference was interesting because folks reported on using oxygen to strengthen the flame. It just so happens that oxygen is produced, along with hydrogen, during the hydrolysis process.

If we do more geothermal, we can get cheap electricity for all us. And as the NH3 technology develops, we put ourselves and future generations in a position to win.

NH3 is simply ammonia and its safety issues are easily overcome. Catalytic converters can take care of greenhouse gases. Folks are working on making the combustion more efficient.

Guy Toyama said he believes we should be burning H2 in the engine and using NH3 as the H2 carrier. That’s why it it’s important to have an ammonia cracker, like Shaun Grannell was demonstrating outside. That engine was running on pure H2. The pipe on the outside stripped the NH3 to H2 + NO, NO2. Hydrogen flame speed is quicker, so you can more easily convert an Internal Combustion Engine to run on H2.

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This is a small engine with the H2 cracker wrapped in tin foil. It ran on straight ammonia.

It was amazing to see. I felt like I was witnessing a historical event.

As we all know, the folks on the lowest rungs of the economic ladder are the ones who will get their lights turned off first, and too often they will be Hawaiians. Geothermal can help to prevent this from happening.

In the uncertain future ahead, we need to take care of each other. Not, No Can. CAN!

Can you folks help us advocate for geothermal?

Biofuel, Geothermal

HECO Says: ‘Let Them Eat Cake!’

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I remember that in the 7th grade we read about a French royal, who – when told that the peasants didn’t have bread and were hungry – is said to have stated, “Let them eat cake.”

I have come to the stark realization that the Hawaiian Electric Company (HECO) has a duty to keep the stock price of its parent company, Hawaiian Electric Industries (HEI), healthy.  It’s not HECO’s mission to take care of Hawai‘i’s people.

But its strategy of raising the cost of electricity to its white-haired stockholders, in order to keep up HEI’s stock price, is as “brilliant” as its strategy of raising electricity rates of farmers so it can pay the farmers the high price they will need to raise biofuel crops.

Cynics have described it as putting money into one pocket
while taking it out of the other.

I just attended the 2010 Hawaii Ag Conference at the Ihilani
Resort and spa at Ko Olina on O‘ahu, which was very well attended.

Although the conference covered many topics, I was most interested in the Hawai‘i Biomass and Bioenergy workshop, which was held all day on Friday. It asked: “What’s the buzz, and what’s in it for agriculture?”

I was encouraged because Diane Ley, the State Executive
Director of the USDA Farm Service Agency, explained that at the end of the day, there would be a facilitated discussion with farmers and Sarah Bittleman, USDA Office of the Secretary.

There were 21 speakers, starting from 8:45 in the morning until 3:15 p.m., when the facilitated discussions began. It was very good and valuable information, covering topics from the USDA Biofuel roadmap supporting President Obama’s plan to transition America’s energy economy, by Sarah Bittleman, to the explanation of Fuel Purchasing – who is doing the “pulling” in the military.

Chris Tindall, Director for Operational Energy, Deputy
Assistant Secretary of the Navy for Energy Office, told us that the Navy is interested in buying very large amounts of advanced fuels that can be used directly to power its Great White Fleet. I can absolutely understand the national security concerns. I found him very clear and persuasive.

Early on in the morning presentations, during the Q&A, I
made the statement that Food Security is about farmers farming, and if the farmers make money, farmers will farm. I pointed out that simple math shows that farmers can not expect to get more than 7 cents per pound to grow feedstock for biodiesel, and that no farmer will farm biofuel feedstock for 7 cents per pound.

Farmers all agree with me, though we would be happy to be proven wrong about this price. I have been saying this for several years, and have not had a single rebuttal to date.

Many folks gave presentations in their area of expertise and
it was all very useful and informative. But the question left unanswered was “How much will farmers get paid for growing biofuels?” All the farmers in the room knew that the answer was: “Not enough.”

The facilitated discussions were very useful. Sarah Bittleman told everyone that it is not for the federal government to decide energy policy for Hawai‘i; that we need to decide that for ourselves.

I thought this was a very important statement, because it
has been my distinct impression that the movement toward biodiesels in Hawai‘i is running because of inertia, and is not going to be overcome by simple common sense.

Ms. Bittleman authorized folks to use common sense.

Several speakers said that we could do both food and fuel. But I wonder about that. It seems to me that if biofuel prices were subsidized enough, then farmers would quit growing food to instead grow fuel. Why shouldn’t farmers strive for a better life for their kids?

It is no longer just me asking why geothermal is not
mentioned. Many, many folks are asking that same question and it can no longer be ignored, because there is just too much at stake. Saying that “People were against it 20 years ago” is just a lame excuse.

Geothermal solves so many of the crucial issues Hawai‘i
faces that we must be looking for ways to maximize its usage. Every single farmer I talk to agrees, and is incredulous that we aren’t doing just that.

I notice that Indonesian palm oil prices are very high compared to fossil fuel oil. If local farmers don’t produce biofuels, then HECO will probably buy expensive palm oil from Malaysia. But HECO will say that it’s okay because it is green.

Hamakua Coast

Growing Ulu

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We are planting ‘ulu trees and eating-bamboo on the parts
of our land not in production agriculture. The idea is to provide
food for our employees.

When we started growing bananas on W.H. Shipman land
at Kea‘au in the early ’80s, there must have been at least 15 ‘ulu trees on the property we leased, each 50 feet tall. In the forest, we could see remnants of human activity from the old days, back when the rule was that ‘ulu trees were not to be cut down.

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This is the variety of ‘ulu (also known as breadfruit) that we are planting. It’s low to the ground and the fruit is not so large that you have too much left over.

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