Saturday, March 28, 2009

The Future Looks Electric

Electric Car that is.

If you ever doubted the effect of political resolve in the direction of the US energy just look at the very recent and profound changes I'm seeing with the current Obama Administration and it's current "Stimulus" monies floating around.

In the span of a month electric cars and infrastructure went from a P.R. play thing for electrical utilities to an audacious effort by Oregon's Governor. Last week I started hearing rumblings of a big effort out of Oregon Department of Energy. It seems to be moving big in this direction with the announcement of a 500 recharging station goal in the next two years. More to the point is that in Oregon the cost looks like it will be under $2,000 to field your own recharging station with the grants, tax credits and other offerings in Oregon's planning.

Wired Magazine covered Shai Agassi's vision for an electric car infrastructure. It's talked about, glowingly received, brainstormed, and then just kind of out there. Add a few billion dollars of Federal political resolve and BOOOOM! The electric car is a reality.

Now lets just see if Tesla, Chevy, and Nissan can deliver their electric cars.

I am really intrigued and interested. I have a few friends who have been betting big on electric power-trains, battery controls, and importing foreign I.P. around this sphere. Before last week I never really thought about the market potential for electric infrastructure. Specifically recharging station.

That has now changed!

My gears have really been spinning about how this market development will need to take place and I'm fascinated. In particular how do you charge for the refill of the vehicle (which current technology will likely take 2 hours). You have a capital cost to recoup, the variable electric bill to charge for, the space (which takes hours per customer), and of course how do you scale a regional, national, or international system so an electric car owning fleet can recharge simply in NYC, LA, or PDX regardless?

This moves the business model away from just electric recharging stations (on a real scale) to be a business model that fits with a traditional regional petroleum jobber. Those wadding away from one-off customers to a wide deployment are now wadding into my waters.

Its really got me thinking about the future of the markets I serve and its an exciting subject. It really reminds me of dealing with early supply issues of Biodiesel and Ethanol. Where those without any fleet supply experience were trying to build businesses without any context or understanding of their market's needs.

Its going to be fun over this summer.

Monday, March 2, 2009

EPA and RIN's Clearing House

OPISnet reports a turn of events around RINs (so did a recent RINstar webinar).

It looks like the EPA will be creating (or at least proposing) their own RIN clearing house. We don't know what this clearing house will look like but of course I'm pretty pessimistic. Guaranteed it will be brought to the industry by the same folks who invented the DMV. Hopefully I'm being a little over dramatic but that's just my gut instinct.

My initial thoughts on this was that you can tell the Obama Administration would be abandoning the market based approaches of the last eight years. Good for CPA's bad for the industry is my prediction.

Sunday, March 1, 2009

Natural Gas vs. Diesel

It's happended for the first time in a while. Diesel is competitive with natural gas.

Wholesale diesel is under $1.20 a gallon which places it below retail natural gas at over $1 a therm (or $10 per million Btu). If you buy gas look at your utility bill. Its significantly cheaper to go oil for the first time in four or five year.

I don't pay attention to Nymex Natural gas costs but I understand those are way down. That's good sign for commercial users buying their own gas and paying the utility for delivery. Regardless for a heating oil distributor like myself this might be a ray of sunshine in a recession as the smaller dual fuel boilers and heating oil customers see value in staying oil.

Heating Oil at $1.20 a gallon is cheaper than natural gas.

$1.20/ 131,000 btus = .000009160305344 per btu

.000009160305344 x 100,000 btu's per therm of Natural Gas = $ .916 per therm equivalent

Future Fuel TV

About a year ago a TV crew from SyndiKast came to Portland to cover the retail biodiesel market in our city. Their project was called Future Fuel TV and the finished product was really good.

They also created a video which I think is a real good time-specific look at what Portland's biodiesel market was like a few years ago. Right before Portland's B5 mandate and the optomistic growth of voluntary adopters.

SyndiKast covers the gamut of biofuels and alternative energy. They produced the segments to be good stock footage as well as a good primer on the subject.

You can see SyndiKast website on biodiesel (I don't believe they have the finished video up currently).