Outrun Change

We need to learn quickly to keep up with the massive change around us so we don't get run over. We need to outrun change.

An illustration of the horrible economics of residential rooftop solar power

Wealth transfer to wealthy under construction. Image courtesy of Adobe Stock.

Robert Bryce explains in an editorial at the Wall Street Journal on 4/18/17 the lousy economics of rooftop solar panels: Thanks for Giving Me Your Tax Money.

Mr. Bryce appreciates each of us for giving him our money. Of course, it was done through the tax system so it wasn’t much of a gift. Anyone who did not go along with funding his lark would have to spend some time in jail.

He explains he installed a 8,540 watt solar system on his roof. That means the 28 panels generate 301 watts each.

I have been wanting to see financial results from an actual rooftop installation. Mr. Bryce provides a set of actual numbers.

Here is the breakdown of the actual cost:

  • $7,758 – federal tax subsidy
  •   6,593 – subsidy from city owned utility
  • 18,100 – his out-of-pocket costs
  • 32,451 – total cost

That means you and I covered 44% of the cost.

He says his system is generating about 12 mWh of electricity a year.

Hmm. That would be about 32.9 kWh a day. For a system with 8,540 watt capacity, the potential, or faceplate capacity is 205.0 kWh each day. So what’s the capacity production on his system?

Read more…

More amazing news from the open frontier of space

Atlas V lifts Cygnus supply ship to ISS. Credit: United Launch Alliance. Used with permission.

It is astounding to ponder the news from the wide open frontier of space. I’m continually amazed by what is happening.

3/7/17 – Space News- NASA seeks information on commercial Mars payload service – NASA issued a Request For Information asking for plans to provide cargo runs to Mars. They are looking for outline of plans in terms of payload mass and weight, nature of vehicle, and timing for start of operations. The RFI indicates 2020 as a start date.

Two companies are described in the article as likely players in Mars cargo runs.

SpaceX would use their new lander Red Dragon as testbed for cargo vehicle. Launch was scheduled for 2018 but has slipped to 2020.

Mars One also has plans for a lander, as an intermediate step for crewed travel. First launch was planned from 2018 but that is now looking like 2022.

3/14 – Behind the Black – SpaceX wins another Air Force launch contract – Ticket price to launch a GPS satellite is $96.5M, up by $14M from the last launch by SpaceX for USAF. Post speculates SpaceX is trying to improve their margin by undercutting ULA less this time around.

Read more…

Freedom continues to evaporate in Venezuela as misery continues to increase. Hmm. Why do those two trends typically seem to accompany each other?

What economic system produces this result? Image courtesy of Adobe Stock.

Ponder what economic system produced this suffering, misery, and loss of freedom.

4/19/17 – Wall Street Journal – Venezuela Antigovernment Protests Turn Deadly – Teargas and gunfire broke up widespread protests on Wednesday.

The death toll rises. Two dead on Wednesday with many more surviving gunshots they received. Seven dead in the last month. Forty-two dead in 2014.

Shooting protesters after stealing all their guns is just how authoritarians and totalitarians tend to roll:

4/19/17 – Washington Free Beacon – Socialist Venezuela Leader Steps up Arming of Supporters After Outlawing, Confiscating Civilian Guns – The government has spent the last five years confiscating guns from private citizens. That’s what authoritarian, totalitarians, and other bad governments do.

Why?

So they can’t defend themselves.

From what might individuals need to defend themselves from?

Read more…

Volume and value of oil production in North Dakota for the last several years

Where you see one well today, eventually there will be 4 or 8 or 12. That concept and the above photo are yet more illustration of why Bakken, Eagle Ford, and Permian Basin, are strategic threats to OPEC. October 2013 photo by James Ulvog.

Let’s look at some longer term graphs of oil production in North Dakota and the value of that production. Here is a view of the annual oil production in the state:

The fascinating insight from that graph is production did not drop in 2015.

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Swings in oil prices and rig count in North Dakota

There is enough untapped oil under the ground for a whole bunch more of those rigs to work in North Dakota. October 2013 photo by James Ulvog.

If  you want to see one graph that explains the swings of drilling and oil production in North Dakota, take a look at this:

The price of oil for producers in the state collapsed in late 2014 due to the OPEC decision to increase production. The price recovered a bit in mid-2015 but continued to drop into the 20 something range.

The price has been steadily trending up, albeit slowly, since mid-2016.

That graph can then explain a lot of other trends.

For example, look at the count of average rigs in operation. The tally dropped dramatically in 2015. It has slowly been recovering since fall of 2016.

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Oil production in North Dakota up 5% in February 2017

Illustration why Bakken and Eagle Ford are a strategic threat to OPEC. Photo by James Ulvog.

Oil production in North Dakota increased 5.38% in February to 1,034,168 bopd (preliminary). This follows a 4.14% increase in January. Two large changes in earlier months were an 8.91% drop in December 2016 and a 7.31% increase in October 2016.

I’ve not posted my usual graphs for a few months. Will get caught up in the next few days.

Here is a graph of average daily production, both state-wide and Bakken-only:

 

Here is a longer term view, with average daily production since 2004:

Read more…

Initial reports for solar panels embedded in road. Well, actually, a walkway. Output worth around a nickel per day.

Image courtesy of Adobe Stock.

A prototype of solar panels installed in roads is being tested. Results are not particularly promising. (Similar story could be told of two projects in Europe, but will have to cover that another day.)

10/18/16 – Daily Caller News Foundation – Solar Road is “Total and Epic” Failure, 83% Of Its Panels Break in a Week – The test project is in Idaho. The concept is that 30 panels installed in a street (actually a walkway so the panels are not actually getting the wear of being in a road) will provide enough power to run a water fountain and the lights in a restroom.

Eighteen panels were DOA. Another five panels failed after a rain shower. Not a hail storm. Not an unseasonal torrential rain. Not a blizzard, as happens often in northern locations. Like Idaho.

A shower.

Article says only 5 of the 30 panels were working at the time.

Read more…

More amazing news from the open frontier of technology

Image courtesy of Adobe Stock.

A few more of the amazing things going on in the open frontier of technology:

  • USAF experimenting with anti-drone shotgun rounds that would snag a drone
  • One state considers allowing police to put lethal weapons on drones
  • Amazon building 7th and 8th fulfillment center in Southern California
  • Amazon starts collecting sales tax in last four states it doesn’t already do so
  • 2 terrabyte flash drive
  • computers as smart as humans by 2029 instead of 2045?

3/13 – The Drive – U.S. Air Force Buying Special Drone-Snagging Shotgun Shells – USAF has 600 special 12-gauge rounds on order for testing. If the test goes well, they will buy 6,400 more.

The rounds are used for snagging a drone.

Read more…

Recent counts of drilling rigs in North Dakota

Drilling rig at dawn. Photo by James Ulvog.

The count of drilling rigs in operation across the state has shown strong increase since fall ’16.

Here is a recap of the North Dakota rig count, all from Million Dollar Way. It has been a while since I posted an update.

Keep in mind that the dramatic increase in productivity and production per well means that the number of rigs isn’t anywhere near as important as it was several years ago. At the same time, the count of rigs is still one indicator of activity. Perhaps the long-term trends aren’t important while the shorter term trends are.

Keep in mind I gather data when I think to make notes on the count. Also, I haven’t double checked the numbers, so there very well could be some errors.

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The space competition heats up. Aaaaand some competitors slow down.

SpaceX SES-10. Credit Flickr. Courtesy of SpaceX for placing photos in public domain.

The competition to be a commercially competitive space launch provider gets far more serious with SpaceX successfully launching a reused Falcon 9 booster to get SES-10 into a geosync orbit.

On the same day as SpaceX made such tremendous progress, two competitors dropped further behind.

Competition speeds up

SpaceX SES-10. Credit Flickr. Courtesy of SpaceX.

I was so fortunate as to check my Twitter feed as SpaceX began its live coverage of the launch. It was such a joy to watch the successful launch and an even bigger thrill to see Main Engine Cutoff, which meant the reused booster did its job.

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Venezuelan Supreme Court usurps all power of the nation’s legislature

Where the Venezuelan Supreme Court filed that part of their constitution defining the legislative branch. Image courtesy of Adobe Stock.

The Supreme Court of Venezuela ruled that it will take over all of the powers of the Congress. That essentially suspends the Congress and removes the remaining power center in the country that is not under the complete control of the president.

Since the president controls the supreme court and obviously now controls the legislature, there is no organized structure that can oppose him.

That’s a major step.

For more info, check out any of the following articles.

For entertainment, consider the spin some headline writers put into their work:

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Now gasoline shortages in the country with the world’s largest amount of proven oil reserves. What economic system could possibly create this mess?

In Venezuela, that sign is needed at hospital pharmacies, bakeries, and now  at gasoline stations. Image Courtesy of Adobe Stock.

The shortages and suffering in Venezuela continues. Your homework for the day: what economic system provides this level of suffering?

  • Foreign reserves are shrinking
  • Bakeries threatened if they bake too many sweets and not enough price-controlled bread
  • Pregnant women are leaving the country to deliver their babies
  • Gasoline shortages appear

3/1/17 – CNN Money – Venezuela is down to its last $10 billion – The country’s foreign reserves are down to $10.5B, from $20B in 2015, and $30B in 2011. That info in sourced to the Central Bank of Venezuela.

Article says inflation is expected to hit 1660% this year and 2880% in 2018.

3/13 – PanamPost – Venezuelan Regime Threatens to Expropriate Bakeries, Jeopardizing Bread – In addition to price controls and currency controls, the government is going to impose output requirements on bakeries. If they don’t produce bread all day at the government limited price, they are subject to take over by the government. Left out of their miscalculation is that the government has stopped importing wheat flour.

 

If bakeries don’t bake enough bread, the government will close the shops.

3/16/17 – Yahoo News – Venezuela arrests brownie and croissant bakers in ‘bread war’ – Well, that didn’t take long.

Read more…

Updates on Bakken

Gotta’ get that well back in production. Crew on workover rig working well after dark. Photo by James Ulvog.

Here are four articles providing a bit of background on what’s going on in Bakken.

You have likely noticed I have long relied on The Million Dollar Way for my education on oil in general and Bakken in particular. Just look at the source for the following four articles. That makes it sorta’ cool when on 3/22 MDW recommended my post Scratching my head at the geopolitical impact of fracking. Thanks for the mention!

2/19/17 – The Million Dollar Way – EURs – Bakken 2.0 – EUR means Estimated Ultimate Recovery, which is the total amount of oil expected to be extracted from one specific well.  Article says the EURs in Bakken were 300K early on. At the point I started paying attention, the EURs were in the 500K range with possibilities of 1,000K.

Article says Mike Filloon has been talking about 1.5M instead of 1.0M.

Now the article lists 14 wells with EURs of 1.5M up to 2.0M EURs.

Read more…

More disruption in the electricity grid from all that solar output

Curtailed electricity in California during 2016 was greater than the output from any one of those towers. Photo by James Ulvog.

The routine surge of electricity during the late morning and early afternoon in California is disrupting the electricity system. Matching the excess production of electricity during the day with highest use in the evening is going to be expensive for consumers.

The underlying issue is solar is neither reliable nor dispatchable.  The issue is beginning to be a problem and will get far worse.

3/5/17 – Wall Street Journal – How California Utilities are Managing Excess Solar Power – There is so much solar power in California that when the sun is bright, there is too much electricity and it must be sold cheaply just to get rid of it. Then, when the sun goes down and demand goes up after people get home from work, there isn’t enough electricity and the spot price goes sky high.

Article says that during the day, the wholesale spot price of electricity frequently shrinks to zero. Occasionally the wholesale spot price can hit $1,000 a megawatt-hour after dark. That would be about a dollar a kilowatt. $1.00.

At the end of the article there is a comment that on 178 days in 2016 the wholesale price went negative. The spot was below zero. The solar plants in California had to pay someone to take the excess electricity. I wonder what that does to the bottom line at Ivanpah? (That is a rhetorical question. – Impact on them is zero because I think they are on a multi-decade fixed price contract.)

Huge battery plants can store electricity during the day and discharge at night. That is expensive. Article says the price ranges from $285 up to $581 a megawatt-hour, which is in contrast to a natural gas peaker at $155 to $227 a megawatt-hour. That is around twice as expensive.

3/18/17 – David Danelski of Press-Enterprise at Daily Bulletin – Here’s how California ended up with too much solar power – The amount of solar power now online in California is so high that it is disrupting the electricity market.

The impact of so much solar capacity shows up at two times during the day.

Read more…

Scratching my head at the geopolitical impact of fracking

That little ol’ thing, along with 500 similar contraptions, is changing the world of oil production. Photo by James Ulvog.

Looks like we are in the midst of radical change in regional and world politics caused by the technological revolution in oil and gas production. I keep trying to wrap my little brain around what is going on. Here are a few articles that may stretch your brain too.

  • Brain stretcher on the shift in geopolitics due to increased US oil production
  • Speculation why the Saudi government’s plan to re-engineer their country’s economy isn’t going to work
  • Three articles on the rapidly increased US shale production undercutting the OPEC production cut

3/12/17 – PJ Media – The Problem of Success – Article raises the unsettling idea that nobody has figured out the impact of dramatically increased production in the US.

Neither the previous US administration, the current US administration, leadership in Saudi Arabia, leadership elsewhere in the Middle East, nor even pundits for that matter, have figured out how geopolitics will change as Saudi Arabia loses its role as dominant oil producer and the decentralized American drillers gain the swing producer role.

It stretches my brain even to understand there is an issue.

American frackers used the dramatic run up in oil prices to $100 as an opportunity to figure out how to frack oil where it could never have been touched before. They then used the collapse in prices as an opportunity to figure out how to frack far more efficiently, far more effectively, with far higher production output from every well. As a result, the break-even price for U.S. shale has shrunk.

The vast network of independent producers are responding to price changes far faster than OPEC could handle or the majors could ever dream of. Prices go up somewhat and in about three months US production is surging.

Read more…

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