Morning Volt for 05/25/2017

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05/25/2017
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Morning Volt

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Be Warned: $25 Oil Is Coming, and Along With It, a New World Order

CNBC

The world as we know it, will be no longer. The balance of power on a global scale will shift. All in the next decade.Sounds dramatic right? But independent think tank RethinkX believes it to be true, because of rapid advances in technology, and specifically the advent of self-drive or autonomous cars. First and foremost, RethinkX co-founder and Stanford University economist and professor Tony Seba told CNBC’s Street Signs that the rise of self-drive cars will see oil demand plummet, the price of oil drop to $25 a barrel, and oil producers left without the political or financial capital they…

Will OPEC Extend Output Cuts in Bid to Push Up Oil Prices?

Andrew Walker, BBC

Energy ministers from Opec, the oil exporters’ group, are meeting at their headquarters in Vienna to do something about it.They will be joined by delegates from some oil suppliers outside the group.On the agenda: whether to extend the oil production curbs agreed last year that are due to expire next month.

Should OPEC Worry About Contango and Backwardation?

John Kemp, Reuters

“Backwardation is the solution" to OPEC’s problem of how to raise output and revenues without sparking another shale boom, according to the influential oil research team at Goldman Sachs.Backwardation would allow low-cost oil producers in OPEC to sell their output at a higher price linked to the spot market while curbing growth from shale firms that sell at prices linked to the forward curve.Goldman’s strategy aims to “share growth" between OPEC and shale firms to avoid another repeat of boom and bust in oil prices (“Backwardation is the solution", Goldman Sachs, May 22).

US Fracking Is Ascendant, But OPEC Isn’t Dead Yet

Michael Bastasch, Daily Caller

OPEC member states and Russia will meet in Vienna Thursday, where they are expected to agree on continuing oil production cuts for another nine months.The petro states are seeking to keep crude oil prices from sliding below $50 a barrel. OPEC, Russia and 10 other non-member states agreed to reduce output by 1.8 million barrels per day in the first half of 2017.OPEC’s Thursday meeting, however, highlights the fundamental shift occurring in the global oil industry.

Home Batteries Aren’t Economical–Yet

Robin Sidel, Wall Street Journal

The promise of a battery that powers your home is that you can sock away energy for a rainy day as easily as putting money in a savings account.Around the world, more homeowners are experimenting with residential batteries, which grab energy when it is generated and store it for later use. The excess power can be tapped if the grid goes downin a storm, sayor during high-demand periods when electricity is more expensive.

Residential Solar Industry in the United States Stumbles

McDonald, Breaking Energy

In recent years the residential solar industry has been one of the hottest industries in the United States with the market leader SolarCity growing by 50% yearly. Growth has been driven by falling solar costs as well as tax credits such as the California Solar Initiative, and the Investment Tax Credit.But that was then and this is now, and with the last year several companies have left the solar industry, reduced their workforce, or gone bankrupt. SolarCity has been absorbed by another of Elon Musk’s ventures Tesla. Now the company has lowered it’s expectations for growth and has refocused…

Trump Budget Proposes Deep Cuts in Energy Innovation Programs

NY Times

President Trump’s budget proposal for 2018 envisions a flurry of changes to domestic energy policy, reaping billions of dollars in one-time revenue from oil and gas resources while cutting research into future energy technologies that could pay long-term dividends.Mr. Trump’s budget, released Tuesday, says it will raise about $36 billion over the next 10 years by selling off major American energy resources and infrastructure, opening up vast new areas of public land for oil and gas drilling, and redirecting state revenues from oil and gas royalties back to Washington.

Gas Prices Forced Electric Cars Out of Their Awkward Phase

Mike Brown, Inverse

Over the past decade, the public perception of electric cars has shifted dramatically: Surveys show that teens love Tesla, the Chevrolet Bolt was named car of the year, and in Shanghai, China, a plug-in hybrid Cadillac is winning over millennials. How did we get here?As more electric vehicles are taking off around the world especially in places like Oslo, where they have become very popular people are coming to realize that they’re not just a passing fad but something credible for the future, Naomi King, a postdoctoral researcher at Oxford Brookes University, tells Inverse.

There’s Way Less Coal Than We Thought

Eric Roston, Bloomberg

So it turns out global warming isn’t that bad after all.That’s exactly the conclusion Justin Ritchie doesn’t want the world to draw from the paper he just published.And for a good reason. It’s wrong.Ritchie, a Ph.D. candidate in resources and the environment at the University of British Columbia, was working as a teaching assistant in 2013 and trying to come up with assignments for his students. Looking through “business as usual" and worst-case scenarios for the emission of carbon dioxide into the atmosphere, he saw that reliance on coal for energy started ramping up around 2040.

Old Coal Mines Have a Place in the Future of Clean Energy

Joe Ryan, Bloomberg

Ben Chafin sees the future of clean energy in abandoned coal shafts.The Virginia state senator, whose Appalachian district is pockmarked with empty mines, pushed through legislation in April that encourages companies to transform those tunnels into giant storage devices to hold vast amounts of renewable power.The idea, which Dominion Energy Inc. has been studying, is to fill mines with water and then use electricity from wind and solar farms to pump it up to a reservoir on the surface. When utilities need power, operators open floodgates, letting water gush back into turbines on its way…

Nuclear Power in America Requires Political Resolve

David Gattie, Morning Consult

For three decades U.S. nuclear power has been strongly influenced by three forces one from the market, one from regulations and one from apathy. Consequently, nuclear power in America has lost ground that must be reclaimed in order to enhance grid reliability, meet economic and climate objectives, and maintain national security.In the early 2000s, fracking technology unlocked abundant U.S. natural gas resources giving the U.S. electric power sector the opportunity to develop a portfolio of unprecedented diversity comprised of coal, natural gas, nuclear and traditional and emerging…

These Are the Forks in the Road to Drilling Automation

Trent Jacobs, SPE

The low price of crude may have slowed the advance of drilling automation technology, but it clearly has not stopped it. Uptake is rising, chiefly in the US onshore market, where contractors including Nabors and Precision Drilling have recently rolled out their first batch of closed-loop automated rigs that take key pieces of the well construction process out of human hands.Service giant Schlumberger is doing the same after it acquired a number of drilling technology firms in recent years, including one that developed rig control systems for the competitiona factor that has been seen…

How Blockchain Could Upend Power Markets

Dick Munson, Energy Post

Blockchain, in short, is a secure, decentralized, and highly efficient way to manage and keep track of infinite transactions. Rather than being stored on a central server, peer-to-peer transactions are replicated across a number of computers, creating a data store that records exchanges in almost real time. To ensure the transactions are secure, authenticity and identity are maintained through cryptography and digital signatures.

The Saudi Oil Blunder That Will Keep Costing

Leonid Bershidsky, Bloomberg View

It’s all but decided that the Organization of Petroleum Exporting Countries and Russia will extend their so-called “production cuts" at Thursday’s meeting in Vienna. It’s clear, however, that the play has been a mistake for Saudi Arabia, which initiated it. It should have stuck with the policies of its former oil minister, wise Ali Al-Naimi, who had driven down the price of oil in 2014 and put the U.S. shale industry through the wringer.

Oil Is Not Going to Either $25 or $75 a Barrel

Nigam Arora, MarketWatch

With OPEC and Russia negotiations in play this week, I have been getting a lot of emails from investors about oil.Many have strong opinions. Some think oil CLN7, -0.33% is going to go down to $25 a barrel. Others think it is going to go up to between $75 and $100.Given my history of providing high-conviction opinions that have often been contrary, both bullish and bearish oil investors seem to want me to agree with their arguments. Take a look at the annotated long-term chart of oil. The chart is of a continuous futures contract, and for the sake of accuracy, I have not updated it. In terms…

Livestream: From Heartland to Homeland: The Energy Renaissance

RCP/API

Watch RealClearPolitics’s From Heartland to Homeland: The Energy Renaissance on Livestream.com.

‘Gas Apocalypse’ Looms Amid Power Plant Construction Boom

Bloomberg

The glut of cheap natural gas from a single, gigantic, shale basin that straddles the Northeast, mid-Atlantic and Midwest has sparked a massive construction boom of power plants. Dozens have been built in the past two years alone.There’s just one problem: There isn’t nearly enough electricity demand to support all the new capacity. And as wholesale electricity prices plunge, industry experts are anticipating a fire sale of scores of plants in the region.

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