Ammonia Fuel Networks Keynote Speaker

Matthew R Simmons of Simmons International speaks out about Oil. The true state of the existing supplies, The promise of Wind, The scam of Shale Gas, and NH3 as the answer.

Comments on Freedom Fertilizer from Interview with Chris Stiener

Beyond prices at peak oil: $20 per gallon

By Lisa Sibley

Published 2009-08-14 11:17

What will the world look like as the price of gasoline climbs, $2 at a time, from $4 to $20 a gallon?

Christopher Steiner, a staff writer at Forbes magazine, takes a look at how the future of energy is going to change, with his new book, “$20 Per Gallon: How the Inevitable Rise in the Price of Gasoline Will Change Our Lives for the Better,” which came out last month.

The book is expected to make the New York Times non-fiction hardcover extended bestseller list, to be published Aug. 16.

But cleantech experts may or may not agree with some of his contrarian speculations and conclusions, namely that hydropower, solar, wind, geothermal and natural gas don’t hold all the answers (see What you don't know about energy can kill you [1]).

Steiner concludes that nuclear power is the elegant and ultimate “Holstein” cow to making the biggest impact on a low carbon energy future. Some don't consider nuclear to be green energy, although he says, perhaps it should be (see Nuclear power is particularly green energy: get used to it [2]).

His book paints a startling, yet exciting picture of the future, interviewing top experts in energy, urban planning, farming and transportation sectors. His predictions include newfangled competitors to the all-electric car emerging, the crashing fall of sushi and the skies emptying of gas-guzzling airlines.

He shared with the Cleantech Group an in-depth look at how rising gas prices will inevitably transform civilization, and consequently, the cleantech sector’s future:

Forbes writer and civil engineer Christopher Steiner roamed the U.S.
on a quest to answer the question: How will people's lives change in a future
with higher gas prices?

What sparked the idea to write this book?

I’ve always been interested in human behavior as it relates to gas prices. I remember when gas prices reached $2 per gallon so many years ago. I thought people would run screaming from their SUVs toward smaller cars and a nascent Toyota [3] model called the Prius (see Toyota plans to take on Honda with low-cost hybrid for 2011 [4]).

Americans, however, largely shrugged at $2 gas. They did the same for $3 gasoline. We kept driving more miles every year, and we kept buying large cars—especially SUVs. Then came $4 gas and 2008: Americans drove 100 billion less miles in 2008 compared with 2007, and SUV sales crashed. Four-dollar gas was clearly a tipping point for how Americans chose their vehicles and how they drove them. So I asked myself: What other tipping points are out there past $4? At what price of gas do most of the airlines cave in? At what price of gas do we eat more local food? At what price do high-speed trains connect much of America?

What's been the most controversial part of the book so far with readers?

There exists part of the population who feels that I’m out there advocating for higher gas prices right now. They feel I’m attacking their way of life. But that’s not the case at all. The book’s premise assumes that, as we go forward, the demand for oil around the world will continue to increase while the supply will actually ebb, albeit slowly.

At that point, you have a scenario straight out of Economics 101: rising demand and shrinking supply = higher prices. So, assuming the price of oil will continue on a steady ascension in the future, I tried to forecast the changes that come with different prices of gasoline.

Your book indicates solar, wind, geothermal, and hydropower by themselves aren't going to be enough to meet our energy needs. What kind of influence to you envision this having on the cleantech sector?

There exist giant opportunities for these kinds of energy generators. We should push on with wind power, for instance, until it approaches 10 percent of capacity—wind’s intermittent nature doesn’t become a threat to the overall grid until that point (see Wind market could hit record high in U.S. [5]). Anything—be it solar, geothermal or wind—that can shut down a few more coal plants is good thing. That said, we’ll need more than renewables to usurp coal completely. That gap, in my opinion, should be filled by nuclear power.

Why isn't nuclear energy attracting attention and funding from investors, or what will it take for nuclear energy to be better supported?

It’s expensive. Very. We haven’t built a nuclear plant in this country from scratch in 30 years; that’s part of the problem. The startup costs are such that even for Exelon [6], a giant electric utility, putting out $12 billion for one plant is cost-prohibitive (see Exelon gets nuclear retrofit [7]). Investors such as Vinod Khosla and Kleiner Perkins can bring a lot of capital to the table, to be sure, but they don’t have the muscle to dump $10 billion or $12 billion into just one power plant. They’re looking for giant home runs, where they might earn 100 times or more on their initial invesment. Nuclear, which is a more mature technology, doesn’t hold that kind of grand slam potential (see Nuclear's biggest problem? Not enough scientists [8]).

The government has to help out here with guaranteed loans, grants, or matching funds. The good news is that once there are people experienced with building next-generation nuclear plants in the United States, the costs of building these facilities will come down. They’ll never be cheap, but they don’t have to carry the costs they currently do.

Your book suggests a ring of farms around U.S. towns will become a source of food for those towns as the price of gas goes up. Is it practical or likely to think that local farming can actually sustain the U.S. population?

Certainly some things, such as soy, corn and wheat, will continue to be grown far away from population centers. Those kinds of commodities aren’t immediately perishable, and they travel well by rail. Local farms, however, will play an increasingly bigger role in supplying fresh produce, meat and fruit. In Chicago, instead of buying an apple from New Zealand or Washington State, you may get an apple from Southwest Michigan or Southeast Wisconsin.

What country or countries should the United States be emulating to become more energy efficient and decrease dependence on fossil fuels?

If you look at what Europe has done since the 1970s and the first oil embargo, they’ve managed to get their per capita energy consumption to a level nearly half of our own while maintaining a high standard of living. We would do well to institute some of the changes Europe made several decades ago, such as widespread electric high-speed trains, smaller cars, higher energy taxes and better zoning laws.

Your book indicates Wal-Mart [2] is changing its business model, to an extent, by opening smaller locations suitable for walkable communities and incorporating sustainable practices (see Wal-Mart & Microsoft's new cleantech deals [3]). What other kinds of companies do you think will take a similar route or are already changing the way they do business?

UPS has set a great example of how to prepare for the future. Here’s a company that’s as tethered to gasoline as can be. They know it. But they’re also preparing for a future when oil costs more. UPS allowed me to don the brown uniform for a day and work on one of their trucks in Manhattan.

The truck is 100 percent electric, and they use it every day to do a normal route in the Soho neighborhood. The truck looks exactly like a normal diesel UPS truck but at night it gets hooked up to a giant 220-volt cord. And, of course, the truck costs about twice as much as a normal UPS mobile (see EV startup set to churn out trucks on U.S. assembly line [4]).

What UPS is doing here is getting familiar with technologies that it will use in the future. UPS uses two of these electric trucks in Manhattan and has several dozen more scattered across Europe. It's using hybrid trucks in Michigan and have developed a truck called a hydraulic hybrid with the EPA. UPS is honing its use of things like electric trucks now, so that when the price of gasoline reaches a certain point—say $7 per gallon—it will be well prepared to make large changes to its fleet that will make sense fiscally. And the changes will be relatively smooth because of the work UPS is doing now.

If everything from the airline industry and resorts to sushi restaurants and SUV dealerships suffer from the increase in gas prices, where will the jobs go?

Green technologies are hot now, and they’ll continue to be hot in the future. We may even see a kind of gold rush at some point that evokes those blurry days of 1999, when everybody was getting in with an Internet startup and on a path to sure riches. Let’s just hope the market remembers its “irrational exuberance” back then and reacts with a bit more restraint during the next boom, although that may be too much to ask.

Beyond that, fields such as civil engineering, urban planning and construction will be the ones boasting job growth. We will need to adjust how we live and that means, to a certain extent, living more densely. Infrastructure begets density. One without the other is miserable. But look at the island of Manhattan: There you have an astounding 70,000 people per square mile. But those people have high quality lives and Manhattan remains superbly functional all because of one reason—the amazing infrastructure than underpins New York. In the future, our other cities will behave more like that and we’ll need people who know how to create that kind of infrastructure.

What was your favorite cleantech-related company/person you interviewed?

That’s a tough call, but I think I most enjoyed Steve Gruhn of Freedom Fertilizer. Steve wants to create ammonia by splitting water molecules using the energy created by wind turbines in Northwest Iowa. America imports up to 80 percent of its fertilizer, almost all of which is made with natural gas, just another fossil fuel. Steve has a vision that would get our crops off foreign feedstocks and be more sustainable to boot. It’s a grand vision. But it’s also going to be very hard to pull off. I’ll be watching his nascent company closely.

Do you think Palo Alto, Calif.-based Better Place [5] will "rule them all" in the end?

Way too hard to say. Better Place has an interesting model, but it’s an expensive model that requires a giant horde of people signing on and, most likely, some kind of government help. Battery swapping for cars, which, in theory, negates the range drawbacks of pure electric
vehicles, is a wonderful idea. But we’ve never seen this type of thing done successfully, and it remains to be determined if Better Place can economically manage, upkeep and swap all of those batteries (see Better Place to charge up Australia [6]).

That being said, Shai Agassi and Better Place are free to mold their model to perhaps better fit what people really want. I do think that nothing would aid Better Place more than an increase in gas prices (outside of straight-up government sponsorship).

What's the time period you envision gas prices going up from $4, in $2 increments, and finally reaching $20 per gallon?

Predicting anything past $8 is extremely tough due to the wildcard effects of government, demand destruction and a coterie of other factors, but we could see $6 within the next 2-3 years and $8 within the next 4-6 years.

Are you currently working on any other book ideas?

I don’t have something directly in the works now, although I‘m pursuing a couple of things. If anybody has any ideas, let me know. I can be reached through my blog (The Steiner Post [7]).

Fundamentals of why Sustainable NH3 from Wind

a) Natural gas consumption in the US will continue to rise

b) North American Natural gas production has peaked. Any new reserves found will have significantly higher production costs.
http://www.energyandcapital.com/articles/peak-natural-gas/529

c) Wind power capital costs per MW will continue to decrease (bigger turbines, lower production costs, larger wind farms)

d) The midwest power grid is, or will be within the next couple years, transmission constrained during high wind power production periods, forcing grid power prices much lower (and occasionally negative) during those times.

e) Any new transmission to address is at least 5 years out, and questionable if it will ever be politically feasible
http://tdworld.com/overhead_transmission/wind-energy-eastern-interconnection-090501/

(also, transmission is around 20% of a wind farm cost. This is significantly in our favor as we would provide a guaranteed local load, with zero transmission losses, or costs, with local use of ammonia, further providing cost advantages) http://eetd.lbl.gov/ea/ems/reports/lbnl-1471e.pdf

f) Electrolyzer capital cost will continue to decline

g) carbon-free sustainable ammonia is worth $1500-$2000 per ton, with an unknown market size

Conclusions:

1. Because of a & b, natural gas prices will only continue to rise
2. Because of c, d, e, & f, our costs for wind-derived hydrogen Iowa, Minnesota, and the Dakotas will continue to decline rapidly

* additional note: Natural gas usage will go UP as wind power deployment goes up, because only natural gas power plants are capable of responding fast enough to provide back up to wind power.

Nitrogen Responce in Biomass

Everyone is talking about how we must produce more biomass for more bio fuels. Here in the heart of the corn belt we know that the tool of choice for higher yields no matter what the crop or the cropping method is fertility and nitrogen is the key fertility element. Without N yields quickly diminish and in the todays world of industrial agriculture only top yields will pay the bills. But in todays world almost all nitrogen begins with fossil fuel and most all synthetic nitrogen fertilizer begins with NH3. Anhydrous Ammonia (NH3) the H3 (3 atoms of hydrogen) all derived from fossil fuel. In this country the fossil fuel of choice is CH4 (methane) natural gas. In some parts of the world it is coal. But no matter what the source of fossil fuel the end result is still the same, CO2 . For every ton of NH3 that is produced the C (carbon) in CH4 has to go somewhere and it does. 1.8 tons of CO2 for every ton of NH3 produced with CH4. This really doesn't help the the idea of biomass producing green bio fuels. But it doesn't have to be that way...... at all. Freedom Fertilizer Carbon free NH3 for truly green biomass and bio fuels. And here is another thought, it doesn't have to come from corn either.

Pictured above is 4 acres of sweet sorghum planted last year at Manly, Iowa by fellow SAFE/Freedom Fertilizer participant Troy Benjegerdes. Troy states "It's taller than the corn, and was planted on ground that was fertilized at my dad's overly aggressive 200lb/acre rate. Initially, I had hoped to try this without any N, but it looks like it made a huge difference. I took 6 samples where it did well, and I got green biomass yields of between 50 and 100 tons
per acre. *IF* this could be harvested and processed effectively, it would amount to at least 600 , if not 1000 gallons of ethanol per acre. (Corn at 200 bushels per acre yields 600 gallons/acre).

I think perennial polycultures (the land institute), and no-till have their place, probably as productive buffer strips around intensive row-crops. But if the choice is intensive nitrogen application to make zero-carbon biofuels vs cutting down more amazon rainforest.. Well, pass me the green ammonia tank.

Validating N Rates for Corn on Farm Fields in Southern Minnesota

Cleantech Stocks vs. Oil / Bullish Case for Natural Gas

From time to time I like to post opinions from others that reinforce our ideals and help to keep us heading in the right direction. Again the guys from Energy and Capital I think are on the money. Not once but twice with this double header opinion. If they are even close to correct it certainly helps to substantiate our case for sustainable ammonia fertilizer. That yes our timing is good and yes we are on the right track.

By Nick Hodge
Wednesday, August 19th, 2009

Cleantech investing isn't about finding the next big field or formation. It doesn't rely on finding the next property with enough oil to satiate global demand for — let's face it — a few months or, best case scenario, a year or two.

In a world that consumes 60,000 barrels of oil per minute, large finds these days are the equivalent of adding a few drops of ketchup to the bottle that's been upside down in the fridge for weeks.

At that rate, the 10.5 billion barrels of estimated recoverable oil in ANWR would last a whopping 121 days. And remember, that's expensive oil — not the cheap stuff that squirts out of the ground. The latter hardly exists anymore.

Any bet on oil is really a referendum on when demand will once again outpace supply. It's a good bet, don't get me wrong. . . but it's only a good bet because oil is scarce. Betting that oil will rise is betting that there's not enough, because the price wouldn't go up if there were.

So make your money while you can.

Just know that the very reason the price of oil will rise is the declining economic availability of a finite resource. A day will come when there's nothing left to wager on.

That being said, investing in cleantech isn't reliant upon a fading resource. That's the whole beauty of it — the resources it needs are naturally available, abundant, and renewable. What cleantech investors are betting on is improvements in the technology used to harness that energy.

When great improvements are made, it's like finding the next Cantarell in the oil business.

Harnessing Clean Profits

Even a few years ago, cleantech investing was still about ideas: Who had the best idea for a solar panel? Who was planning to build the biggest wind turbine?

This was before the cleantech industry was scaled, before profitability was reached. Now, solar and wind are global businesses with major manufacturing bases on five continents.

It's no longer about the best idea; it's about lowest cost, highest margin, sales volume, and future contracts.

This is no longer a risky or marginal energy business. This is a growing international industry with global competition and government support. It's the fastest growing energy sector by far.

Which reminds me, when's the last time you heard a government or special interest group hammer home the idea of increasing oil dependence? All the attention is on limiting oil consumption while greatly increasing clean energy production.

As a multi-billion dollar global industry, there is serious money to be made investing in clean energy stocks. And the strategy is a bit more precise than wagering on the next company to secure a land lease.

That's where Green Chip and, in particular, the Alternative Energy Speculator, come in. Our years of experience in this industry have allowed us to become familiar with all of its nuances, putting us on the forefront of green investing.

In fact, The Speculator has closed 34 winning cleantech positions this year — more than one per week — not just in solar and wind, but in water and smart grid, as well.

The hardest part about investing in cleantech is deciding to actually invest in cleantech. We do the rest. Our thousands-strong community of successful green investors can attest to that.

But it's one thing to say it's easy. . . just like it's easy to state the "estimated" oil in a new find.

It's another thing to prove it and show it.

Here's what I mean. . .

It's Easy Being Green

It's not easy to know that there's a general oversupply of solar panels on the market right now. It's not easy to know that average selling prices (ASPs), for modules and solar cells have been slipping as a result, putting pressure on earnings margins for suppliers.

It's not easy to be familiar with stimulus packages in multiple countries that will push hundreds of billions of dollars into the green capital markets. It's not easy to interpret how that money will affect capital expenditures for new solar and wind plants.

And it's certainly not easy to keep track of contracts and pricing mechanisms for dozens of companies.

But it's easy to open your e-mail, buy a stock, and then sell it for a profit. Readers of the Alternative Energy Speculator have faced that daunting task 34 times this year.

It's the perfect combination of solid investment advice and a booming market. And it's much easier to take gains from a sector that international governments and banks are eager to see succeed, rather than from an industry facing mounting political roadblocks and adversity, not to mention resource scarcity.

Just take a look at the numbers. The chart below compares the year-to-date performance of the U.S. Oil Fund ETF (NYSE: USO), which tracks the price of oil, and the Oil Services HOLDRs ETF (NYSE: OIH), which holds a variety of stalwart oil service companies, against a solar company, a smart grid company, and a wind company:

Oil has done marginally well for the year and the services ETF has done a bit better, up about 45% — respectable gains for any investor.

But notice the three stocks from three different cleantech sectors. They're each up well over 150%. . . and they're not isolated examples.

This is due to several factors: the loosening of credit markets and the willingness of banks to lend to cleantech projects; billions of stimulus dollars aimed at project development; tax advantages in several countries; high returns for project investors; and above all else, the fact that clean energy began at less than 1% of the energy mix.

When your share of global energy production is that small, even modest advancement means big percentage growth. Going to just 2% meant a doubling of its use. And the use of clean energy will double several times over in the next decade or two.

The use of oil is not going to double. Not even close.

So by all means, profit from oil's decay. It would be foolish not to.

But it's also foolish not to invest in clean energy and stuff your pockets from both sides. The growth rates are much faster and the returns much higher. Not to mention, all you have to do is open your e-mail and buy winning stocks.

The Bullish Case for Natural Gas

By Keith Kohl | Tuesday, August 18th, 2009

It's been nearly three weeks since I last talked about natural gas.

And lately there really hasn't been much reason to get excited. Prices have been stagnant at best, right? After all, it was just over a year ago when prices were well over $10 per Mcf. A few weeks ago, prices finally rebound over $4 per Mcf.

As you're probably aware, the move didn't last long.

Today, prices are barely holding above $3/Mcf ($3.16/Mcf the last time I checked). But if there's one thing we've been trying to show Energy and Capital readers, it's that this is a golden opportunity to get back into natural gas.

Believe me, if natural gas under $4 is a steal, I can't express how dirt-cheap it is under $3 per Mcf.

But before I get into my long-term bullish sentiment, let's take a quick look at why prices have declined. To start with, the demand picture has been ugly during this recession.

In their latest Short-Term Energy Outlook, the EIA estimated that natural gas consumption will fall 2.6% this year and remain flat throughout 2010. Of course, the drop is due to the lackluster industrial demand, which makes any future economic recovery even more important to the long-term case.

The supply side of the equation isn't much better right now. The EIA reported that working gas storage increased to 3,152 Bcf. That's 530 Bcf above the five-year average of 2,635 Bcf. The five-year storage is nearly 20% higher than a year ago. Furthermore, our working gas storage is expected to top 3,800 Bcf by the time we reach the end of the injection season in October.

In response to the demand drop and cheap prices, companies have drastically scaled back their drilling activity. According to Baker Hughes, there are approximately 688 rigs drilling for natural gas in the U.S. That's a steep drop of 56% from a year ago.

However, when it comes to natural gas, it's not the short-term that I'm excited about.

The Bullish Case for Natural Gas

Let's take a quick look at where our natural gas comes from. . .

According to the EIA, the United States imported approximately 4 Tcf of natural gas in 2008. As expected, nearly all of our imports (approximately 90%), were shipped from Canadian pipelines.

I don't expect Canada to keep up those numbers for very long.

You see, aside from aside from a few emerging shale deposits, Canadian production isn't looking too good. Practically all of Canadian natural gas is produced from the Western Canadian Sedimentary Basin. Production in the WSCB, however, peaked back in 2001 at approximately 16 Bcf per day.

Canadian drillers have been struggling to keep up ever since. The only way producers could keep up with the decline rates was by increasing their rig activity. With prices this cheap, it's nearly impossible to keep pace. Several weeks ago, my colleague, Chris Nelder, pointed out the 11% year-over-year Canadian production decline.

Last week, First-Energy Capital Corp analyst Martin King reiterated the bad news: "At a projected average of 14.7 Bcf per day in 2009, this would be the lowest average natural gas production rate seen in Western Canada since 1995."

Throw the blame wherever you'd like, dear reader; whether it's the decreased demand, warm weather, or even the storage glut, the short-term price outlook for natural gas isn't pretty. However, the dearth of North American drilling from those factors will help prices recover over the long run. Couple the lack of drilling with a demand recovery, and any glut in supply will quickly dissipate.

Depending on an economic recovery, natural gas prices could easily top $6 per Mcf by the end of 2009. That's certainly not too far of a stretch, considering January 2010 contracts of natural gas are trading around $5.47/Mcf.

I have yet to meet a reader of mine that's bearish on natural gas over the long term. For us, that means that now is the time to get your hands dirty.

Three Ways to Play a Natural Gas Rebound

One of the easiest ways to play a rebound in natural gas prices is through the United States Natural Gas Fund (NYSE: UNG), which tries to replicate the performance of natural gas by investing in the front-month natural gas NYMEX contract.

With UNG trading at a near 52-week low, any upturn in natural gas prices could give investors a pleasant surprise.

By now, anyone who has put so much as a dime in natural gas has at least heard of the latest shale plays. Take Canada's production woes, mentioned earlier. One of the bright spots on future Canadian gas production is located in the Horn River Basin. The Horn River Shale Formation in British Columbia is one of the more recent shale plays to make headlines — with potentially 250 trillion cubic feet of natural gas in the ground, between 10% and 20% would be recoverable.

However, the producers aren't the ones that have my attention. Rather, it's the infrastructure that I'm focusing in on. In order to get the Horn River gas to market, pipelines are needed to transport the natural gas. Several pipeline projects are in the works, including the Pacific Trail Pipelines Limited Partnership. Once completed, the $1.2-billion pipeline will transport Horn River shale gas to an LNG terminal near Kitimat, B.C.

And then we have the individual U.S. shale players.

Even with the 56% decline in drilling from 2008 levels, many of these companies have managed to see production rise. Of course, when it comes to drilling, it's all about location. Although producing natural gas from these new shale plays isn't without its own difficulties (extracting the shale gas requires drilling deep into the ground and effectively fracturing the shale), the potential for bullish investors is certainly there.

Ammonia from wind likely to happen in 2010

Originally published in the July 24, 2009, print edition. By Dick Hagen
The Land Staff Writer

At a recent West Central Research & Outreach Center event, WCROC engineer Cory Marquart said their wind-to-hydrogen-to-ammonia project involving their 1.65 mw turbine is being negotiated with a design-build firm in the Twin Cities. Once this agreement is signed, this project officially launches and will likely be closely watched by farmers and agricultural energy investors.

“We’re hoping to start construction this fall,” Marquart said, so ammonia from wind could be happening by next summer’s field day. There are still a few unknowns about this way to put wind power to work, but Marquart said upwards of 1 ton anhydrous ammonia per 24 hour period is doable.

Actual capacity of this turbine would be about 1 1/2 ton per day if wind energy was a constant, but at the Morris location winds are mostly in the 35 to 40 percent efficiency category. Marquart said at this stage it’s not a matter of inventing new technologies but rather putting old technology to work in a different manner.

Most interesting to farmers, of course, is at what price might ammonia from wind cost. That is strictly a matter of the price of natural gas since natural gas is the primary source of anhydrous ammonia today. “So if natural gas is costing you $1,400 to $1,500 per million BTUs then anhydrous ammonia will also likely be costing $1,400 to $1,500 per ton. If natural gas is $7 per ton, ammonia usually costs around $700 to $800 per ton,” Marquart said.

The potential real value of ammonia from wind farms is that it would provide a stabilizing factor in the nitrogen fertilizer market. Also if fertilizer ammonia becomes excessively higher priced, then ammonia from wind becomes even more feasible. He said a ballpark figure for ammonia costs from wind would be in the $1,000 per ton range but that is purely an estimate at this time.

“Farmers like to know what their input costs are ahead of each production year so they can better plan their budgets. So if ammonia from wind becomes a supply factor in the real market, producers would value that opportunity,” Marquart said.

He sees ammonia production facilities being hitched to mega-wind farms of 20, 30 or more wind turbines, justifying storage capacity for several hundred tons of anhydrous ammonia. He also foresees marketing diversity of such wind farms. If the ammonia market is strong, dedicate the wind energy to that product. And when there are seasonal heavy demands for electricity, “then sell electricity instead. Or when fuel cells become a bigger player use that market opportunity for hydrogen production also.”

Marquart suggested that the business plan of community wind projects needs to be diversified in its marketing structure simply because constantly changing energy demands will dictate different forms of energy from any given wind farm. “We already have fuel cells that can run directly on ammonia so if/when fuel cells become economically feasible for the automotive industry the entire structure of our nation’s wind industry might change considerably.”

Even though there have been manufacturing slowdowns within the big wind turbine industry, he doesn’t see this as a lessening of interest in big wind projects. “I think this is a temporary blip because of the struggling world economy. Several big wind farms were in the works prior to the economy going sour. Many of those equity investors needed the passive income tax credits so money for wind was no particular problem. Now these same investors aren’t needing those tax credits and consequently lots of ‘big money’ has disappeared,” he said. He added that once the economy turns around and tax credits become useful to big investors, then big projects would again surface.

There has been much press coverage on vertical axis turbines, a new family of smaller and considerably shorter wind units, but Marquart said he has yet to see a unit that has wind efficiency comparable with the big turbines dominating the high country of western and southwestern Minnesota. Granted, their imprint is smaller, but he questions the efficiency of the vertical axial wind unit as a major electricity producer.

He does, however, see growing interest in the smaller (40 kw and less) units for on-farm power and/or net metering back into the local utility any unused electrical power. “There’s still a large upfront investment for these units venturing from $40,000 to $75,000 depending upon size, but even with today’s relatively modest rural utility rates you’re looking at a 10- to 12-year payback. I think this is an industry just waiting to ramp up,” Marquart said.

He said interest in wind turbines certainly hasn’t slackened. Frequent phone calls and visitors stopping at the WCROC, regardless of intent; invariably people ask about the Morris turbine and the wind-to-ammonia project. He predicts the future of wind energy will basically go two directions: 1) wind for electricity, and 2) wind for hydrogen/fertilizer. “There’s not one ‘silver bullet.’ Instead we’re calling it ‘silver buckshot’ which simply means there could be lots of different uses for wind power down the road.”

There likely will be more big wind in the Morris area. The University of Minnesota, Morris, campus intends to become carbon neutral, the first institution in the nation to achieve that status. Though not yet officially announced, folks at the WCROC are predicting two new turbines, likely 2 mw or larger, and likely adjacent to the existing 1.65 mw turbine that dominates the landscape within a 10- to 15-mile radius of Morris.

A report by the American Wind Energy Association shows Minnesota ranks first in the nation in the percentage of energy it gets from wind power. Minnesota got 7.48 percent of its electricity from wind last year, up from 4.6 percent in 2007.

However, Minnesota is losing ground in the race to wind energy capacity. Texas is tops with 7,118 megawatts. Texas added almost 2,700 megawatts of wind energy capacity last year, more than any other state. Iowa was second, California third. Minnesota ranked fourth, with 1,754 megawatts including 456 megawatts of new wind energy capacity last year.

Freedom Fertilizer Featured in Just Released Book $20 a Gallon By: Christopher Steiner

Senior Editor for Forbes magazine and author Christopher Steiner has just released (7/01/09) a new book entitled $20 per Gallon. The book, a first of its kind on the subject of the increasing cost of gasoline goes beyond “peak oil” and the idea that we are coming to the end of the fossil fuel age. The book has been receiving a lot of press with Christoper being interviewed on Fox News, The Today Show with write ups in Time Magazine and of course Forbes Magazine as well. The book is based on the concept that as the world’s oil supplies continues to tighten and oil prices rise it not only will create world changing issues it will also create profound opportunity, changing our lives for the better.

Steiner’s book investigates in depth how far embedded fossil fuel is in our daily lives. One area of which is agriculture, especially fertilizer. As the price of oil increases it will create problems for our world’s farmers and food supply. Farmers will have to deal with the ever continuing price increases of fossil fuel and fossil fuel based nitrogen fertilizers. Through a series of interviews I had with Christopher Steiner last summer he makes sizable mention of these issues, devoting an entire chapter to the subject. Much of the chapter is about Freedom Fertilizer and the concept of sustainable ammonia production. Christopher told me during this interview process that writing the book had been very scary and at the same time very rewarding as he pieced together what our future world may look like. One of the scariest areas he was finding was how the world would feed itself. Christopher said that until he ran across Freedom Fertilizer that he was seeing only a brick wall. After our interviews he said that he sees Freedom Fertilizer as having the potential of being one of the profound life changing opportunities.

Below is an interview with Christopher Steiner that happened this past week on the NBC Today Show

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