The United Kingdom jumped back on the fracking bandwagon as Energy Minister Ed Davey announced the country will resume drilling for shale gas with tighter rules imposed. A few tremors at a drilling site in Blackpool a year ago had caused nervous officials to impose a temporary halt to the technology. But Davey says the country is not ready to go ahead. Thus Britain will join the US as a fracking nation, rejecting the association with the rest of Europe, which has imposed a permanent embargo on the technology. British environmentalists sneered that Davey thinks he is JR Ewing but Tara Evans of This Is Money says it promises a new era of cheaper gas.
On this side of the Atlantic, President Obama pushed ahead with offshore wind by funding 17 projects with $169 million. The 40-story turbines, each taller than the Statue of Liberty, will cover 1900 square miles of ocean. Projects are slated for the coast of North Carolina and Virginia, Maine, Lake Erie and the Gulf Coast Texas. Offshore wind is almost twice as expensive as its nearest competitor and when the electricity finally arrives onshore it will probably require huge government backing again. All this leads Robert Bryce, writing in National Review, to call wind the most heavily subsidized industry in American history.
Whether part of those subsidies will continue is still being debated in Congress as the December 31 deadline for extension of the wind production tax credit approaches. The American Wind Energy Association, sensing the tide running against it, has proposed a six-year phase-out instead of an abrupt end this year. EnergyBIz reports that Iowa Senator Chuck Grassley predicts the tax credit will be thrown in with a lot of other tax breaks in the Fiscal Cliff deal and extended for yet another year. Writing in the BurlingtonFeePress, John Norton of NRG urges supporters to speak out – presumably to start covering the Green Mountains with windmills. But Larry Bell, writing in Forbes, calls the whole thing “a tax-blowing boondoggle.”
Chicago has decided to open up its electrical market by allowing Integrys, a Milwaukee utility, to sell to 1 million customers in competition with Samuel Insull’s beloved Commonwealth Edison (above). The Chicago City Council approved the measure 50-0. Mayor Raul Emmanuel, who spearheaded the effort, said it could save customers anywhere from 10-25 percent on their electrical bills. Integrys has promised to substitute natural gas for coal but renewable energy's contribution is still unclear.
Finally, in company news, Williams has paid $2.4 billion to buy into the Access Midstream pipeline formerly owned by Chesapeake Energy. At the same time, Access Midstream announced an offering of $1.4 billion in senior notes to complete the purchase from Chesapeake. Hess says it has found oil offshore from Ghana and PBF Energy, an independent refiner, is pricing its IPO. And on Seeking Alpha, Rom Badilla says Peabody Coal may be poised for a rebound.