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RFF: No Discrepancies between USGS and EIA Shale Gas Estimates

By Kennedy Maize

Washington, D.C., October 18, 2011 — Remember the flap about inconsistencies between the Energy Information Administration and the U.S. Geological Survey over shale gas estimates for the Marcellus formation? Forget about it.

According to a new paper from the Washington think tank Resources for the Future, there’s no discrepancy at all: the two government agencies weren’t talking about the same thing.

At issue is the amount of gas sitting in the Marcellus shale formation in the Middle Atlantic region, which EIA had pegged at 410 trillion cubic feet, an astonishing amount of natural gas. Then, last August, USGS released its Marcellus figure, at 84 tcf, still an enormous amount, but clearly much less optimistic than EIA. EIA said, prematurely, it appears, that it would defer to the expertise of the Interior Department geologists. But maybe it won’t work that way at all.

Fossil fuel opponents, and the New York Times, which has been on an anti-gas crusade, pounced on the discrepancy as evidence that shale wasn’t all it was fracked up to be.

But, says EIA analyst Dave McLaughlin, it’s really just a matter of terms. The two estimates don’t contradict, and, in fact, may be additive. In other words, there may be even more Marcellus gas than EIA estimated. What’s at work, says McLaughlin, is “likely a misunderstanding of the definitions of shale gas resource classifications used by the EIA and USGS. Definitions matter here and it is easy to confuse these in particular because the USGS and the EIA use some, but not all, of the same classifications.”

The terms to focus on, says the RFF report, are undiscovered resources and inferred reserves. Both government agencies use the same definition for undiscovered resources. Basically, they mean gas that can be technically recovered outside known fields, which potentially could be added to reserves. But that definition does not include reserves, a more concrete figure. EIA, part of the U.S. Department of Energy, defines inferred reserves based on usage from the Potential Gas Committee, an industry-sponsored group. The 410 tcf figure came from a consultant, INTEK, which specializes in unconventional fuels, such as shale gas, and is consistent with Potential Gas Committee estimates.

Says RFF’s McLaughlin, “When strictly adhering to the aforementioned definitions, the 84 tcf estimate of undiscovered resources should not replace the 410 tcf of inferred reserves, and should only replace the previous estimate of undiscovered resources of 0 tcf for the Marcellus play. In theory, as the 84 tcf becomes discovered and evaluated, some of the estimate will be added to the amount of inferred reserves.”

EIA and USGS are discussing the issue, writes McLaughlin. “If they stick to the definitions,” he says, “the 84 tcf estimated by the USGS will simply replace the previous estimate of undiscovered resources. Hopefully the EIA and USGS will engage in a larger discussion about the wisdom of utilizing a conventional resource base classification on the unconventional shale resources.”

The distinctions are subtle, but real. Want to bet they won’t show up in the New York Times?

 

The Perils of Nuclear DIY

By Kennedy Maize

Washington, D.C., October 17, 2011 – To describe Progress Energy’s Crystal River nuclear power plant on Florida’s west coast as a problem unit is a substantial understatement. Commissioned in 1977, the 838-MW Babcock & Wilcox pressurized water reactor has been one of nuclear’s Poor Pitiful Pearls for the past few years.

Currently, in the latest of a series of calamities dating back three years, Progress faces a decision by Florida utility regulators just how much it can recover from its customers to pay for a do-it-yourself steam generator replacement gone bad. According to accounts in the Florida press, the total bill to the utility – currently enmeshed in a merger with Duke Energy – could amount to over $2 billion, including the costs of replacement power. The company says most of that should be covered by insurance, but that’s not certain.

Replacing steam generators in PWRs, once a novel undertaking, has become fairly routine. It often involves some heavy-duty cutting into the concrete and steel dome to create doorway for the massive pieces of gear, something that has now been done in well over a score of plants where the steam generators haven’t lived up to their projected lives. It might also be possible to fish the equipment out through a containment hatch, a trickier enterprise.

Progress appears to have faced a fundamental choice. It could leave the steam generators alone and shut the plant down when its original license expires in 2016. Or it could make the repair and seek a 20-year license extension from the U.S. Nuclear Regulatory Commission. In January 2009, Progress applied for a license extension.

After bidding out the steam generator replacement job, the utility also decided that it could save $15 million (compared to a low bid of $81 million) by doing the cutting job itself. But once the work began in the fall of 2009, the workers discovered a crack in the containment. According to the NRC, the crack likely was caused by the utility, through errors in the way the workers loosened the steel tendons that surround the structure to give it stability.

Things went from bad to worse. According to an account in the St. Petersburg Times, “Things have not gone well. The company fixed the initial crack, but the containment building developed another one when workers retightened the tendons. Company officials have gone back to the drawing board. No final decision on how to repair the building has been made.” The company says the plant won’t operate until at least 2014.

In the interim, the utility and the regulators are sparring over who gets to pay for the repairs, the utility or its customers. Robert Trigaux, a Times business columnist, describes the whole affair as “Honey, I broke the nuclear power plant.” Trigaux raises questions about the license extension. “Should we have second thoughts about this scenario?” he writes. “It’s almost like discovering your artificial hip has worn hout. You know it will cost thousands to replace. If a scrub nurse offers to do the job for a hundred bucks, it is worth the risk? When it comes to a big-bucks nuclear plant, this should never have happened.”

There is another troubling development on the horizon that affects B&W PWRs and that may have some relationship to the Crystal River woes. FirstEnergy, based in Akron, Ohio, has reported a 9-meter long hairline crack in the containment head at its snake-bitten Davis-Besse plant. The 890-MW plant, which entered service in 1978, has suffered repeated and lengthy shutdowns over the years.

The latest problem surfaced in early October, with the unit down for installation of a new reactor vessel head, according to a Reuters account. When workers began cutting into the containment to get at the reactor head, they discovered what the company is calling “micro-cracks.” A FirstEnergy spokesman told the news service that the cracks were not similar to the problem at Crystal River.

This would be the third reactor head for the Davis-Besse plant. The original reactor head had to be replaced when workers in 2002 found a large hole in the head, attributed to corrosion from borated cooling water leaking from a cooling rod drive. In 2010, inspections found a series of small cracks in the control rod nozzles in the new head, leading to the decision to replace the new head.

According to FirstEnergy’s Todd Schneider, “We don’t believe there will be a problem with the schedule to replace the vessel head. Engineers are conducting a thorough investigation of the cracks. We should have an answer

 

Guest Blog: Obama Administration’s Electric Transmission Announcement

By Carl Zichella

Oct. 5, 2011 — The Obama administration’s Rapid Response Team for Transmission (RRTT), today announced a plan to accelerate the permitting and construction of seven transmission lines that are forecast to create thousands of operational and construction jobs. These projects are intended to serve as pilot demonstrations of streamlined federal permitting and will provide renewable electricity in Arizona, Colorado, Idaho, New Mexico, Nevada, Oregon, Utah, Wyoming, New Jersey, Pennsylvania, Minnesota and Wisconsin, and create a much needed modern and efficient infrastructure grid.

All these lines are in some stage of National Environmental Policy Act (NEPA) review and all in at least some manner will benefit the integration of renewable energy sources. Some are more controversial than others in terms of environmental impacts and the power they will move. They are to be pilot projects in streamlined federal project review and approval. If the implementation of this plan is done right, it can be a real boon for renewable energy, by helping close the time gap between project development and access to transmission. Some of the best renewable energy sources on the planet are separated from the consumers that need it by hundreds to a thousand or more miles. Projects can be brought on line in several years while transmission can take five, seven or ten years to approve and develop. Significant amounts of the time is spent in the approval process, much of which is necessary, but some of which can be avoided if federal agencies and state and local jurisdictions better coordinate their activities.

As this morning’s announcement stated: “Building electric transmission lines involves coordination among multiple federal, state, and tribal agencies subject to permitting, review, and consultation. Improving the overall quality and timeliness of these procedures enables the federal government to help expedite new transmission lines. Adding necessary transmission infrastructure will integrate renewable electricity sources into the grid, accommodate the growing number of electric vehicles on America’s roads, help avoid blackouts, restore power more quickly when outages occur, and reduce the need for new power plants.

The RRTT is comprised of nine federal agencies signatory to a 2009 Memorandum of Understanding on enhanced collaboration (Energy, Agriculture, Defense, Interior, Federal Energy Regulatory Commission, Commerce, the Environmental Protection Agency, and the Advisory Committee on Historic Preservation and the White House Council on Environmental Quality). Read more about the RRTT here.

The Obama administration believes – and so does NRDC – that we can accelerate transmission approvals without cutting corners on environmental or cultural reviews. These pilot projects demonstrate that enhanced coordination can play a critical role in accomplishing the goals laid out in the Western Grid 2050 report (see my blog here) to get us on a trajectory to cut emissions in the West by 80% in 2050.  As always the devil is in the details, and this process will not be a spectator sport.  To be successful several elements not entirely spelled out in the administrations announcement will need to be included, to wit:

1. The process needs to be for renewable energy, not “coal by wire.”  Transmission projects selected as “pilot projects” should at least focus on accomplishing the clean energy goals the President has articulated (1 million electric vehicles on the road within four years and clean power sources providing 80% of the nation’s energy by 2035), and help move us rapidly toward a lower carbon future.
2. The process should lean heavily on transmission planning efforts in both the Eastern and Western Interconnections, in which stakeholders from the environmental community, states, utilities, transmission sponsors, Native American tribes and consumer interests are working together to identify  and plan renewable energy transmission upgrades in lower conflict corridors.  Unfortunately the announcement makes no mention of this, although the administration is funding and has been very involved with the planning being done across the country.

None of the lines selected have been put through the new processes being developed in these planning venues, but all of them are in some stage of formal environmental review and permitting. NRDC has not explicitly endorsed any of these projects, though we have been working with the sponsors to help facilitate stakeholder consultation as they wend their way through the NEPA and permitting processes.

Crossing twelve states the RRTT’s seven selected pilot project transmission lines are:

Boardman-Hemingway Line powering Oregon and Idaho:

The new 500 kilovolt (kV) transmission line proposed by Idaho Power would create an approximately 300 mile long, single-circuit electric transmission line from a proposed substation near Boardman, Oregon to the Hemingway Substation near Melba, Idaho—known as the Boardman to Hemingway Transmission Line Project or B2H Project.  According to the developer of this project during peak construction, this project is estimated to create about 500 jobs in Idaho and Oregon.

Gateway West Project to bring new transmission across Wyoming and Idaho:

Jointly proposed by Idaho Power and Rocky Mountain Power, this project would add approximately 1,150 miles of new, high-voltage transmission lines between the Windstar Substation near Glenrock, Wyoming and the Hemingway Substation near Melba, Idaho. According to the developer of this project, during peak construction, it is estimated to create between 1,100 and 1,200 jobs.

Hampton-Rochester-La Crosse Line to power to Minnesota and Wisconsin:

This double- circuit capable 345 kV transmission line will run between a new substation near Hampton, Minnesota, a new substation north of Pine Island, Minnesota, and continue on to cross the Mississippi River near Alma, Wisconsin. A single circuit 345 kV line will be built in Wisconsin to a new substation in the La Crosse area. Two 161 kV lines will be built between the new substation near Pine Island and existing substations northwest and east of Rochester. According to the developer of this project, approximately 1,650 jobs will be created during peak construction.

Oregon to get additional transmission from Cascade Crossing Line:

Portland General Electric’s proposed Cascade Crossing Transmission Project includes approximately 210 miles of 500 kV transmission line from Boardman to Salem, Oregon—for the construction of four new substations, expansion of three existing substations, and upgrades to the existing transmission systems near Salem.  According to the developer, Cascade Crossing is expected to create about 450 jobs during peak construction.

SunZia Transmission, LLC to bring power to New Mexico and Arizona:

SunZia Transmission, LLC plans to construct and operate up to two 500 kV transmission lines originating at a new substation in Lincoln County in the vicinity of Ancho, New Mexico, and terminating at the Pinal Central Substation in Pinal County near Coolidge, Arizona. According to the developer estimated job creation will be about 3,408 direct jobs during the construction period.

Susquehanna to Roseland Line brings new transmission to Pennsylvania and New Jersey:

PPL Electric Utilities (PPL) and Public Service Electric and Gas Company (PSE&G) have proposed the Susquehanna-Roseland power line project which includes an approximately 145-mile long 500 kV transmission line from the Susquehanna Substation in Pennsylvania to the Roseland Substation in New Jersey, and several 500 – 230 kV substations in both Pennsylvania and New Jersey.  Based on the current schedule for the environmental review, the project is expected to be in service in the spring of 2015.  According to the project’s developer, over 2000 jobs in New Jersey and Pennsylvania are impacted pending the project’s approval from the National Park Service.

Transwest Express to stand-up transmission from Wyoming to Utah and Nevada:

TransWest Express LLC plans to construct and operate a more than 700 mile, 600 kV, transmission line which is estimated by the developer to create 1,035-1,550 direct jobs per year at peak construction. This project will facilitate the development of new wind projects in Wyoming.

This blog appeared in Switchboard, the staff blog of the Natural Resources Defense Council, where Carl Zichella is lead staff for western U.S. renewable energy transmission siting. Reprinted with permission.