Many Roads Lead To …Fool’s Gold. Bezos-Biden Barbs.

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Today’s Key Takeaways:  EPA can still write rules for carbon capture to regulate power plants. EU labels gas and nuclear as “green” while Shell plans to build Europe’s largest green hydrogen plant. Explaining the origin and diversity of every known mineral on earth. Oil prices moves lower on demand reduction. Bezos schools Biden on Economics 101. 


Supreme Court ruling opens door to carbon capture
Benjamin Storrow, Climatewire, July 5, 2022

Writing rules around the relatively new technology may be one of the few avenues EPA still can use to legally regulate carbon dioxide from power plants.

 The Supreme Court’s recent climate ruling means carbon capture will likely form the backbone of any new EPA regulations targeting carbon dioxide emissions from power plants, energy experts and legal analysts said.

It’s an approach that could prove awkward for both the coal industry and the Biden administration.

Environmentalists long have been skeptical of carbon capture and storage over concerns about its costs and environmental impact.

They point to a series of failed and expensive CCS projects as a sign of the risks that could prevent the technology from delivering deep emission reductions. Many would capture carbon dioxide from power plants and pump it into aging oil fields to stimulate more crude production.

Yet the technology is one of the few that has the potential to survive Supreme Court scrutiny.

Coal companies and mining states long have pushed CCS as a way to keep coal in the fuel mix — and they’ve secured bipartisan support in Congress for carbon capture research and tax credits. But adding carbon capture and storage to existing coal plants is an expensive proposition and making the technology the industry standard likely would prompt many plants to close altogether.

“If EPA promulgates a new rule that has CCS as the best system of emission reduction, it is a near certainty that we will see that,” said Michael Burger, executive director of the Sabin Center for Climate Change Law at Columbia Law School. “They want it to stay alive, but they don’t want it to serve as the basis of a standard that they actually have to meet.”

EPA’s likely focus on CCS is a byproduct of the Supreme Court’s ruling in West Virginia vs. EPA last week (see related story).

In handing down a 6-3 decision, the high court ruled EPA could not employ strategies like the Clean Power Plan, an Obama administration proposal which sought to use emission trading and generation shifting to slash CO2 from existing power plants (Climatewire, July 1).

Instead, the court found that the agency should rely on its traditional approach of regulating pollution at the source. In practical terms, that has meant bolting pollution control equipment onto power plants to lower emissions.

The challenge is that there are relatively few avenues for reducing CO2 at coal and gas plants.

Efficiency improvements can produce marginal emission reductions. Both the Obama and Trump administrations included so-called heat rate improvements in their respective carbon regulations for power plants. The difference was that the plan under former President Barack Obama also called for emission trading and generation shifting where the strategy under former President Donald Trump largely rested on efficiency.

Utilities also could choose to blend fuels, with power plants mixing lower carbon alternatives with their traditional fuel, said John Larsen, an analyst who tracks the power sector at the Rhodium Group. Coal plants, for instance, could also burn gas.

Whether that approach would run afoul of the Supreme Court’s dislike of generation shifting is unclear.

“The list is pretty short when it comes to fossil fuel fired power plants. Carbon capture is one of the technologies that has the potential for the biggest reductions,” Larsen said.” Heat rate improvements do almost nothing.”

To adopt CCS as the best form of emission reduction, EPA would need to conclude carbon capture is demonstrated technology. Whether that determination would survive judicial scrutiny is an open question.

Some argue it could. In 2021, there were 27 commercial carbon capture facilities in operation around the globe and another 108 in various stages of development, according to the Global CCS Institute. That includes two CCS facilities at power plants in North America: one in Canada and one in Texas.

Congress has sought to spur the development of CCS in recent years by enhancing a tax credit for carbon capture facilities and providing $2.5 billion as part of the infrastructure law to develop a series of CCS projects. The law requires the money be spent at two coal plants, two gas plants and two industrial facilities.

Yet CCS projects at power plants have a long history of failure in the United States.

Southern Co. pulled the plug on a carbon capture and storage project at its Kemper County Energy Facility in 2017 after the project’s price tag ballooned to $7.5 billion (Greenwire, June 23, 2017). FutureGen, a CCS project in Illinois that received $1 billion in federal financing, was similarly canceled (Climatewire, Feb. 4, 2015).

The lone CCS success at a power plant in the United States had been at Petra Nova, a CCS project installed on a generating unit at a massive coal plant near Houston. The project piped captured CO2 to a nearby oil field, but it was shuttered in 2020 during a period of low oil prices (Energywire, Sept. 22, 2020). Petra Nova since has been damaged in a fire.

“If I were the owner of a coal plant and you told me you have to put CCS on your plant, I would absolutely challenge that it has been adequately demonstrated. But if I were arguing for the rule, I would argue it has been adequately demonstrated,” said Emily Grubert, a professor of sustainable energy policy at the University of Notre Dame who recently finished a stint in the Department of Energy’s Office of Fossil Energy and Carbon Management. “This is one of those areas where reasonable people can disagree.”

The problem is that by the time that disagreement is sorted out in court, the window of time when it makes sense to install CCS at existing power plants may have passed. Many coal plants in the United States are already old. Others simply lack the space for a carbon capture unit, she said.

“The universe of plants this could apply to is not as big as other countries” with younger coal fleets, Grubert said.

EPA has turned to carbon capture before. During the Obama administration, the agency implemented a rule effectively requiring CCS at new coal plants. That rule has been less controversial because utilities have had little appetite for building new coal plants. Outside of a tiny coal plant in Alaska, the last coal plant built in the United States was a medium sized facility in North Dakota in 2014 that later converted to gas.

Yet CCS use for new plants doesn’t necessarily mean it can be adopted as the standard for existing ones, said Sean Hecht, co-executive director of the Emmett Institute on Climate Change and the Environment at the UCLA School of Law.

“The technology of CCS may be in a different state of development and deployment for retrofitting existing plants, as opposed to building new plants,” he wrote in an email.

The standard for existing plants is also different “since that section requires that EPA allow states to develop their own plans for meeting the standards,” Hecht said.

He added that “it’s really not possible for me to prejudge whether any degree of CCS for existing plants might be ‘adequately demonstrated.’”

EPA has likely been weighing such factors for months. Many analysts have long said the agency would avoid resurrecting the Clean Power Plan for fear of stoking the ire of the Supreme Court, which stayed the regulation in 2016. Last week’s ruling merely removed what little ambiguity there was left about the court’s posture.

In legal terms, the biggest question is whether the Supreme Court would view a CCS-based emission rule as a legitimate use of EPA’s authority or a disguised attempt to end coal burning.

The court left intact the agency’s authority to regulate greenhouse gases and signaled it wanted to see EPA return to its traditional approach of emission regulation, Burger noted.

In theory, a technology-based standard like CCS should satisfy the court’s wish, even if it drives up the cost of coal generation and prompts plants to retire, he said.

“You have to hope that judges aren’t going to strike down a regulation with indirect effects. The problem that the court had with the Clean Power Plan — the core problem — was its perception that the Clean Power Plan was designed to do away with coal,” Burger said. “That said, there were snippets of language that indicate that the court will look closely at any rule that will have the effect of eliminating coal from the energy mix.”


Oil Prices Move Sharply Lower
Andreas Exarheas, Rigzone, July 6, 2022

Oil prices moved “sharply lower” on Tuesday, analysts at Standard Chartered highlighted in a new report sent to Rigzone late yesterday.

The commodity tested below $105 per barrel in early trading as the recent “tug of war” between recessionary fears and falling demand on the one side and unstable geopolitics and falling supply on the other side moved in favor of the former combination, the analysts noted in the report.

“Along the curve, Brent for delivery five years out fell by $0.19 per barrel week on week to settle at $74.27 per barrel on 4 July,” the analysts stated in the report.

“The front of the curve steepened further, with the December 2022 to December 2023 Brent spread widening by $1.08 per barrel week on week to $14.76 per barrel,” the analysts added.

At the time of writing, the price of Brent crude oil was trading at $105.08 per barrel. The Brent price closed at $102.77 per barrel on Tuesday, diving from its previous close of $111.63 on July 1. Brent has closed above $120 per barrel this year on several occasions, the last of those coming on June 14.

Gas Prices

Looking at gas prices, the Standard Chartered analysts noted in the report that the August contracts for both UK National Balancing Point (NBP) and Dutch Title Transfer Facility (TTF) natural gas increased by more than 25 percent week on week.

“August NBP gained UKp 58.33 per therm week on week to settle at UKp 282.24 per therm on 5 July, while August TTF gained EUR 32.693 per megawatt hour (MWh) to EUR 162.94/MWh,” the analysts said.

“NBP gas has continued higher, pushing above UKp 300 per therm in early trading on 5 July. Prices are still well below the all-time highs set in early March in the immediate aftermath of Russia’s invasion of Ukraine when NBP settled above UKp 500 per therm and TTF settled above EUR 225/MWh,” the analysts added.

“That is likely to be of only limited solace for policy makers as, for example, current NBP prices are 220 percent higher year on year and 1,900 percent higher than two years ago,” the analysts continued.

In the report, the analysts stated that the latest push higher in European gas prices was reinforced by industrial action in Norwegian gas fields and by mounting concerns that the Nord Stream 1 pipeline might not return to service on time, or even at all, after its scheduled 11-21 July maintenance.


From the Washington Examiner, Daily on Energy:

EU PARLIAMENT BACKS TAXONOMY RULE FOR NUCLEAR, GAS POWER: The European Parliament on Wednesday backed European Union rules putting a “green” label on nuclear and natural gas investments, a decision that will ease construction of infrastructure for those power sources over the objections of some environmentalists and members of the bloc.

The vote paves the way for the EU proposal to become law and will add gas and nuclear plants to the EU “taxonomy” rulebook from 2023, which seeks to guide spending toward projects in line with the bloc’s climate goals. The action comes as Europe tries to cut its dependence on Russian fossil fuels amid the war in Ukraine and lean on nuclear and natural gas to help bridge a transition to renewable energy.

Slovakian Prime Minister Eduard Heger praised the move as good for energy security and the bloc’s goal of reaching carbon neutrality — that is, adding no more carbon to the atmosphere than is removed by other means — by 2050.

“We’ll remain on the way to climate neutrality by 2050,” he wrote on Twitter.

Still, the effort has prompted intense backlash from some member states, including Austria and Luxembourg, as well as environmental group Greenpeace, which all said Wednesday that they plan to challenge the decision in court.

Shortly after the Wednesday vote, Luxembourgish Energy Minister Claude Turmes said on Twitter that the Luxembourgish government and Austria will follow through with an earlier threat to “press legal charges,” adding that he “deeply regret[s]” the ruling.

The vote paves the way for the EU proposal to become law and will add gas and nuclear plants to the EU “taxonomy” rulebook from 2023 that seeks to guide spending toward projects in line with the bloc’s climate goals. The news also comes as the EU seeks to cut its dependence on Russian fossil fuels amid the war in Ukraine and lean on nuclear and natural gas to help bridge its transition to renewables.

Slovakian prime minister Eduard Heger praised the move as good for its energy security and the bloc’s goal of reaching carbon neutrality by 2050.

“This will delay a desperately needed real sustainable transition and deepen our dependency on Russian fuels,” climate activist Greta Thunberg wrote on Twitter. “The hypocrisy is striking, but unfortunately not surprising.”

Reminder: The same debate had started to play out in the U.S. late last year with Democrats’ push for a clean electricity standard, but it was cut short when Sen. Joe Manchin nixed the idea of any such a program. The push had exposed a fundamental difference in strategy between Democrats and environmentalists as lawmakers considered whether to rely solely on renewable energy or support other zero- and low-carbon resources, including nuclear and carbon capture.

SHELL PLANS TO BUILD EUROPE’S LARGEST GREEN HYDROGEN PLANT: Meanwhile, Shell has decided to build Europe’s largest green hydrogen plant.

According to a statement from Shell, the Holland Hydrogen I plant, to be built on reclaimed land adjacent to the Port of Rotterdam, will be powered by 200 megawatts of electrolyzers, making it 10 times the size of the largest existing green hydrogen facility in Europe once it opens in 2025.

The company said it plans to produce hydrogen at the plant using electricity generated by a wind farm off the coast of the Netherlands.

“Renewable hydrogen will play a pivotal role in the energy system of the future and this project is an important step in helping hydrogen fulfill that potential,” Anna Mascolo, the executive vice president of Shell’s emerging energy solutions, told Reuters of the effort.


Earth’s mineral diversity 75% greater than previously thought
Mining.Com, July 5, 2022

Researchers at the Carnegie Institution for Science developed a method for clustering (lumping) kindred species of minerals together or splitting off new species based on when and how they originated, a novel approach that explains the origins and diversity of every known mineral on earth.

In two papers published in American Mineralogist and sponsored in part by NASA, the scientists point out that their findings help reconstruct the history of life on earth, guide the search for new minerals and ore deposits, predict possible characteristics of future life, and aid the search for habitable planets and extraterrestrial life.

According to co-authors Robert Hazen and Shaunna Morrison, once mineral genesis is factored in, the number of “mineral kinds” — a newly-coined term — totals more than 10,500, a number about 75% greater than the roughly 6,000 mineral species recognized by the International Mineralogical Association on the basis of crystal structure and chemical composition alone.

Another key finding of the 15-year scientific effort is that more than 80% of the earth’s minerals were mediated by water, which is, therefore, fundamentally important to mineral diversity.

By extension, this explains one of the key reasons why the Moon and Mercury and even Mars have far fewer mineral species than earth.

“The work also tells us something very profound about the role of biology,” Hazen said in a media statement. “One-third of earth’s minerals could not have formed without biology – shells and bones and teeth, or microbes, for example, or the vital indirect role of biology, such as by creating an oxygen-rich atmosphere that led to 2,000 minerals that wouldn’t have formed otherwise.” 

Many roads lead to…fool’s gold

The paper also notes that nature created 40% of earth’s mineral species in more than one way – for example, both abiotically and with a helping hand from cells – and in several cases used more than 15 different recipes to produce the same crystal structure and chemical composition. Those recipes ranged from near-instantaneous formation by lightning or meteor strikes, to changes caused by water-rock interactions or transformations at high pressures and temperatures spanning hundreds of millions of years.

Among those minerals with a number of different recipes is pyrite, aka fool’s gold, for whose creation nature came up with 21 different methods over the last 4.5 billion years. Pyrite forms at high and low temperatures, with and without water, with the help of microbes and in harsh environments where life plays no role whatsoever.

Composed of one part iron to two parts sulphide (FeS2), pyrite is derived and delivered via meteorites, volcanos, hydrothermal deposits, by pressure between layers of rock, near-surface rock weathering, microbially-precipitated deposits, several mining-associated processes, and many other means.

Rare elements

The studies also found that rare elements play a disproportionate role in the planet’s mineral diversity. Just 41 elements — together constituting less than 5 parts per million of earth’s crust — are essential constituents in some 2,400, or over 42% of earth’s minerals. The 41 elements include arsenic, cadmium, gold, mercury, silver, titanium, tin, uranium, and tungsten.

In addition, much of the planet’s mineral diversity was established within its first 250 million years, with the oldest known minerals being tiny, durable zircon crystals, almost 4.4 billion years old.

There are also almost 300 minerals that are thought to pre-date earth itself. Of these, 97 are known only from meteorites, with the age of some individual mineral grains estimated at 7 billion years, which is billions of years before the origin of our solar system.

Mining, on the other hand, has also played a role in the creation of minerals — over 500 species of them. Of these, almost half were formed by coal mine fires.

How they did it

To reach their conclusions, Hazen and Morrison built a database of every known process of formation of every known mineral. Relying on large, open-access mineral databases, amplified by thousands of primary research articles on the geology of mineral localities around the world, they identified 10,556 different combinations of minerals and modes of formation.

In all, minerals have come into being in one or more of 57 different ways.

The goal behind all this work was to understand how the diversity and distribution of minerals have changed through deep time and to propose a system of mineral classification that reflects mineral origins in the context of evolving terrestrial worlds.


Jeff Bezos spars with White House over gasoline prices
Carlos Anchondo, Energywire, July 5, 2022

The founder of Inc. pounced on a tweet from President Joe Biden that told companies running gas stations to cut their prices “to reflect the cost you’re paying for the product.”

 The White House and Inc. founder Jeff Bezos traded barbs on Twitter over the Fourth of July weekend after President Joe Biden called on the companies running gasoline stations to cut prices at the pump.

“This is a time of war and global peril,” Biden said in a tweet on Saturday. “Bring down the price you are charging at the pump to reflect the cost you’re paying for the product. And do it now.”

Bezos, owner of The Washington Post, responded to the president that evening, saying, “Ouch. Inflation is far too important a problem for the White House to keep making statements like this.”

“It’s either straight ahead misdirection or a deep misunderstanding of basic market dynamics,” Bezos continued, drawing a heated response the next day from White House press secretary Karine Jean-Pierre.

“I guess it’s not surprising that you think oil and gas companies using market power to reap record profits at the expense of the American people is the way our economy is supposed to work,” Jean-Pierre said in one of two tweets.

The weekend exchange is not the first time Bezos has butted heads with the White House. In a May tweet, for example, Bezos criticized Biden over a tweet about inflation where the president said: “Let’s make sure the wealthiest corporations pay their fair share.”

The volley of tweets comes as gasoline prices drop, though they are still more than $1.60 higher than this time last year. The national average for regular gasoline registered at $4.80 yesterday, according to AAA, down from $4.89 a week ago.

The Biden administration has taken several steps to bring down gasoline prices, including asking Congress to suspend the federal gasoline tax for 90 days and convening oil and gas executives at Energy Department headquarters last month (Energywire, June 24).

Still, Biden warned last week that high gasoline prices could be around for a while as Russia’s war against Ukraine continues (Energywire, July 1).

Jean-Pierre’s tweets on Sunday elicited responses from across the oil and gas industry, including Megan Bloomgren, senior vice president of communications at the American Petroleum Institute.

“Global economics show that energy demand is outstripping supply & impacting prices — not use of ‘market power.’ Re: power, the top 10 oil companies on [Earth] are owned by foreign govts,” Bloomgren said in a tweet. “It’s time Washington viewed energy as the long-term strategic asset for [America] that it is.”

Another tweet, from the US Oil & Gas Association, said: “Working on it Mr. President. In the meantime – have a Happy 4th and please make sure the WH intern who posted this tweet registers for Econ 101 for the fall semester…”