Solar Projects in California Dangerous?

In Southern California this past week there have been much opposition to plans for new solar plants to be constructed. As much as "five solar thermal projects" are facing opposition says the New York Times. While these projects would "power more than two million homes, create thousands of construction jobs and help the state meet aggressive renewable energy mandates," the opposition is worried about the wild life living in these areas. These solar panels would be built "in fragile landscapes and are home to desert tortoises, bighorn sheep and other protected flora and fauna." This construction would destroy their nature habitat, probably killing most.

While I am a big supporter of solar energy, this construction seems to be the wrong idea. We would be destroying a huge ecosystem in the protected landscape of Southern California. While it is always good to build new solar plants to generate homes and provide jobs, putting these five solar plants in would do more harm then good. I believe the regulators need to find a new place to put these plants so they do not ruin the animals habitat. Hopefully they can because these solar plants would be very beneficial to the state.

http://www.nytimes.com/2011/02/24/business/energy-environment/24solar.html?_r=1&ref=earth

Jack Welch- General Electric

“Jack Welch grew to fame in the business world through his management success and skills during his many years at General Electric. Welch turned the struggling slow moving giant of a company into a dynamic growth company revered by many. During his 20 years of leadership at General Electric (GE) Welch increased the value of the company from $13 billion to several hundred billion.” (http://www.woopidoo.com/biography/jack-welch.htm)

Jack Welch is known for his no nonsense leadership style. His leadership gave him a reputation of being hard, even ruthless, but also fair when making business decisions. In his management style he did not have time for bureaucracy or a system of government. If managers didn't change they were replaced with someone that could change. He used his code of ethics to run his business. Managers were given free period in office as long as they followed the GE (General Electric) ethic of constant change and were determined to do better. I believe that his style of management and his leadership made him strive and made his business grow rapidly. With the right management style, I believe that many managers and entrepreneurs can shine and excel.

“General Electric saw great growth and expansion under Jack Welch's leadership. Through streamlining operations, acquiring new businesses, and ensuring that each business under the GE umbrella was one of the best in its field the company was able expand dramatically from 1981 to 2001.” (http://www.woopidoo.com/biography/jack-welch.htm)

"Obama’s Shout-Out for Energy"

This article further proves to extent to which Pres. Obama and his staff (Dr. Chu) are attempting to distribute more money to the energy movement. In fact, the author states that Obama's new budget proposal has increased the spending for the Department of Energy by 3 billion dollars. The administration is focusing on wind, solar, geothermal, and biomass energy. Furthermore, the proposed budget asks for more funding of energy innovation hubs. According to Secretary Chu, these small labs are the equivalent to the Apollo Project. Dr. Chu believes that in these labs the leading innovations will take place for energy, his only concern is that in the last proposed budget he asked for 6 labs, but Congress only agreed to 3. Thus, he is attempting to increase the number of labs.

I am very proud to see that the administration is sticking to their word and really pushing for energy development. Interestingly enough, Yucca Mountain was not mentioned within the proposal. But what it did mention was a push to find new ways of disposing of waste - one such method was to decrease the half-life. A problem I see is that this is the type of news which doesn't get coverage. I doubt that a majority of Americans know to what extent Obama is pushing for energy development. So if Congress doesn't approve it then Americans are only going to see that "Obama failed because he did not do what he said he was going to do during the State of the Union Address about energy" when in fact, it is Congress who is hindering the President's actions.

http://green.blogs.nytimes.com/2011/02/14/obamas-shout-out-for-energy/?scp=10&sq=energy&st=cse

RecycleMania

American University has recently become involved in a competition called, "RecycleMania." It runs from February 6th to April 2nd and is meant to encourage a more green-friendly campus. I think the fact that tournaments such as these exist suggest a shift in the American mindset towards being ecologically friendly. This shift, in turn, represents a growing opportunity for the energy industry to promote green products and practices. Not only would doing so protect the environment, but it would also increase an organization's dedication to CSR, which would result in higher profits.

Resolutions to Oil Companies

A couple of days ago I read an article in the New York Times about how there are "at least 66 resolutions relating to climate and environmental issues aimed at more than 40 oil, coal and electric power companies, have been filed in the 2011 proxy season." These resolutions have most likely been brought up because of the BP oil spill. The spill has spurred many reforms in the oil business with many new reforms to safety regulations. These regulations are helping to make these companies safer so another BP spill does not happen.

These moves by the shareholders are very influential in how oil companies run their businesses. "The resolutions for 2011 are new highs for such resolutions aimed at the energy sector, and a 50 percent increase over the number filed last year." This rise is meteoric because of the BP oil spill and it may slow down production, but they are necessary. I think this is a good move by the shareholders because obviously there needs to be action when catastrophes like the BP oil spill happen. This step by the shareholders is an example of how ethics are related to business. BP oil made a mistake and the shareholders made the ethical decision and made oil companies change so they could be safer even if it means slowing down production.


http://www.nytimes.com/2011/02/19/business/energy-environment/19proxy.html?ref=earth

Exxon Mobil and XTO Energy Inc?

Oil and gas giant Exxon Mobil Corp. has completed the acquisition of XTO Energy Inc. and created a new organization to focus on the production of alternative natural gas and oil resources. The all-stock transaction, valued at $41 billion. In this acquisition, each common share of XTO had been converted into the right to receive 0.7098 shares of ExxonMobil common stock, with cash to be paid in instead of any fractional shares.

I believe this new organization will create opportunity for more jobs and investment in the production of “clean” natural gas both in the United States, and around the world.

Now Exxon is struggling to find more oil. “Exxon said in the report that it more than made up for the shortfall in oil by stocking up on natural gas, mostly through its acquisition of XTO Energy Inc. last year.” Exxon now has more natural gas in reserve for future production than oil.

Company spokesman Alan Jeffers says the company's "focus is on resources and projects that add shareholder value." That can be accomplished by finding oil, he says, but value can also be delivered through a corporate acquisition.

Exxon is the largest U.S. Company, and it has done so by market capitalization. But as we know, new technologies have helped vast resources of natural gas, however the growing demand from emerging economies raised oil prices up strongly.

If I were an investor, I would be wondering if Exxon bought XTO last year just to cover the level of their substitute problem.

http://online.wsj.com/article/SB10001424052748704409004576146362117313094.html?KEYWORDS=emerging+oil+companies

Big Oil Company in Gulf Being Sold

In a new development in the oil company world, Seahawk Drilling Inc, is being bought out by another large oil company called Hercules Offshore Inc. Seahawk Drilling, in order to avoid bankruptcy, sold its assets to it's competition Hercules Offshore Inc. The deal is worth approximately $100 million. Seahawk Drilling however did not go out without some words for President Obama. They were critical of Obama and blamed him for "a crippling regulatory environment in the aftermath of the BP PLC oil spill."

This article brings up the issue of the oil regulations after the BP spill. Most oil companies are losing revenue because the new regulations make the drilling process longer and more expensive. President Obama set up these regulations because of the catastrophic BP spill. While they are supposedly making the process safer, are they worth it? Seahawk Drilling argues its not worth it, but that might be the bankruptcy talking. Michael Bromwich, director of the Bureau of Ocean Energy Management, Regulation and Enforcement, said "We know the pace is not as fast as some would like, and we regret the impact the permitting process has had on companies and individuals." This is a hot topic issue that we have to keep our eyes on in the future.


http://online.wsj.com/article/SB10001424052748704329104576138851833497500.html?mod=WSJ_Energy_leftHeadlines#printMode

Supply and Demand

The demand for clean energy has surged within the passing years. More and more countries are beginning to invest more of their GDP in transitioning to clean energy. But it seems as though the supply, or infrastructure, is not adequate enough to fulfill the demand. I say this based off of two things. President Obama very much emphasized his interest in clean energy during his speech at the State of the Union. Now he has promised new tax incentives, government investment, and revamped regulations for energy efficiency. I don't think President Obama would be so fired up about clean energy if the supply was meeting the demand. The President is urging Americans to invest in clean energy, thus there is demand for it from his perspective.

http://thecaucus.blogs.nytimes.com/2011/02/03/in-pa-obama-pushes-investment-in-clean-energy/?scp=3&sq=energy&st=cse

Energy Efficiency on College Campuses

More and more schools today are going green to do their part in helping to create a healthier planet. President Obama's speech at Penn State University last week followed up on this growing trend. His speech to Penn State students was mostly a follow up to his State of the Union Address the week before. The main focus of his speech was making more and more buildings greener and energy saving. Not only would this process of going green help the earth, but apparently it would help the economy. Obama states that these greener buildings would save "businesses up to $40 billion dollars a year in utility bills."

While I am not totally convinced that this plan will save company's $40 billion dollars. I do believe that greener buildings throughout the country, especially schools, will benefit the country over time. Greener buildings will help the environment and over time save businesses money. Sounds like a good investment to me.

Here is the article on his speech...

http://www.cnn.com/2011/POLITICS/02/03/obama.energy/index.html?iref=allsearch

Oil Prices Rising in Egypt

Gasoline prices are likely to crawl higher as anti-government protests continue in Egypt.

“The national average for a gallon of regular gasoline was $3.124 on Friday, according to AAA, Wright Express and the Oil Price Information Service. That's up 2.4 cents in the past week. Analysts expect prices to stay at $3 a gallon or higher — perhaps rising as much as 8 cents over the next two weeks — until the conflict in Egypt is resolved and tensions ease in neighboring countries.” (http://news.yahoo.com/s/ap/us_oil_prices)

Oil remains the biggest trade, and perhaps the biggest risk for traders, as unrest in Egypt persists. Countries, such ad the U.S and especially Europe as a whole are worried about the markets and any disruption to the Suez Canal or Suez-Mediterranean Pipeline; Egypt's key routes for oil transit from the Red Sea to the Mediterranean. A disruption in supply may be a major method for a big move in the price of oil.

So what will happen in the future? Speculations? Prediction markets? This is a speculative market designed so that prices can be interpreted as probabilities and used for prediction. Will the disruption in supply in Egypt, affect the prices of oil? Uncertainty about the spread of unrest could send oil prices significantly higher early this week.

(http://www.cbsnews.com/stories/2011/01/31/ap/business/main7302244.shtml)

Increased Demand, Decreased Supply in Energy Market

According to Ian Talley of the Wall Street Journal, the International Monetary Fund has said that international markets need to slow the growth of their economies to prevent inflations in both food and energy prices. If these inflations are not prevented, the overall repair of the global economy could be threatened. Countries such as China, India, and Brazil are becoming high in demand for both food and energy, but lack of supply in developed countries is resulting in economic troubles.

Many people blame these troubles on the U.S. Federal Reserve because of its recent policy to keep rates low so as to ultimately receive more money from "emerging markets" (Talley). This approach, known as quantitative easing, is one of the Fed's attempts to help repair the economy. The problem is that supply levels cannot keep up with demand, especially in the energy sector.

To combat this issue, the International Monetary Fund has teamed with the Group of 20 largest nations to suggest global guidelines for directing capital flow. With greater investments in the food and energy markets, the global economy's overall recovery should improve.

Source:

Talley, Ian. "IMF Warns on Inflation, Growth Risks." The Wall Street Journal 5 Feb. 2011. The Wall Street Journal Digital Network. Web. 6 Feb. 2011.