Requiem for Gus Mayer

August 2016

By Gary Smith, PowerSouth President & CEO

Gus Meyer - USE THIS ONE

Gus Mayer giving me instructions.

Gus Mayer – my faithful companion, my best friend and loyal super beagle – left me for the Rainbow Bridge at 3:30 p.m. April 14. I can talk and write about him some now without crying.

Last November, I received the terrible news that his kidneys were failing and that he had only months, maybe weeks, to live. You may not know that kidney failure is fatal to dogs because there is no kidney dialysis for them. Gus Mayer survived five months, but finally, the poisons healthy kidneys would have filtered overwhelmed him and took him from me.

I have written about Gus Mayer a few times in these articles. In December 2009, I wrote an article on a dog’s carbon footprint based on the book, Time to Eat the Dog? A Guide to Sustainable Living. For a few weeks, Gus Mayer was a pet media star-dog. He received quite a few fan letters, two of which offered marriage proposals. He was impressed that Labrador Retrievers would be interested in him.

A year later, I wrote another article based upon Gus Mayer’s listening abilities. He was the most patient listener and would lie by me for hours listening to whatever I wanted to talk about. However, he was more interested in dinner than he was in climate change. He said he was not unusual, either. Most people (and dogs) are more interested in what they will eat next than in climate change.

I also wrote an article titled, ‘Who Stole Your Truck’ in which I talked about Gus Mayer and my adventures driving my Chevrolet Tahoe. I received an irate letter about that article from a gentleman who was outraged that I would drive a vehicle with such a poor emissions profile. Gus Mayer was mildly amused by the letter but was still always ready to go, especially if we were going through the magic windows at fast food restaurants.

Dogs are man’s best friend. That was more than true of Gus Mayer. He was my friend, but family, too. Kalli, my middle daughter, adopted him while she was in college. He was very sick when she got him from the Humane Society, and one of her roommates said, ‘…that dog will be more expensive than a shopping trip to Gus Mayer’ (an expensive Birmingham women’s store). And he was. After Kalli’s landlord threw him out of their house, he adopted me.

He was always happy to see me. He trained me well. I knew when he wanted to be fed and when he wanted to go out. He loved to drag me around the neighborhood smelling and marking all the shrubs and bushes. He went to the beach with me and took me walking in the sand. He was always there for me to talk to. He never disagreed with my ideas.

He was not perfect, but no dogs are. He was a glutton and was obese – a very chunky beagle. He was selfish. He would eat his food and the cats’ food, as well. They and I had to fend for ourselves over food. He had lung disease brought on by antibiotic treatments for pneumonia when he was a puppy. The treatments for the lung disease probably ruined his kidneys.

Lots of songs and stories are about dogs. John Hiatt sings, ‘I never felt so free, just my dog and me,’ about traveling with his dog. Fred Eaglesmith sings about his dog in his song, A Good Dog. However, he notes, ‘…dog stories never end well,’ and they don’t. Dogs don’t live as long as we do, and we usually have to let our dogs go on before us.

Probably the best dog story is Willie Morris’ short story, My Dog Skip, which was also made into an acclaimed movie starring Kevin Bacon. The plot recounts the adventures of Skip and a teen-aged Willie as they encounter bootleggers, race relations, football heroes and friendships in Yazoo City, Mississippi. When Willie goes to Oxford, England, as a Rhodes Scholar, Skip sleeps in Willie’s room waiting on him to return but passes away while he is abroad. The book concludes with the line, ‘…they said they buried him under the elm tree. That wasn’t totally true. For really, he laid buried…in my heart.’

Like Skip, Gus Mayer is really buried in my heart. I still miss him. I still look for him in all his favorite places. I know he is at the Rainbow Bridge waiting on me. I don’t know if there is a dog Heaven, but I can’t imagine a Heaven without dogs and without Gus Mayer.

I hope you have a good month.

For the Birds

July 2016

By Gary Smith, PowerSouth President & CEO

Nova_Auburn

One problem with wind energy is that hundreds of thousands of birds are killed each year flying into the spinning blades of the turbines. To help researchers develop a radar warning system to protect the birds, Auburn University lent eagles to the National Renewable Energy Laboratory in Colorado earlier this year. In this photo, Auburn eagle handler Andrew Hopkins holds Nova, (aka War Eagle 7) a 16-year-old golden eagle. Photo by the National Renewable Energy Laboratory

 

On August 13, 2013, ExxonMobil pled guilty to killing approximately 85 migratory birds in five states. The birds, none of which were protected or endangered, died as a result of exposure to natural gas reserve pits and wastewater storage areas between 2004 and 2009. Exxon paid fines and made community service payments of $600,000, and agreed to invest more than $2,500,000 in its compliance plan to prevent additional bird deaths at its facilities.

Acting Assistant U.S. Attorney General John Cruden stated, “The environmental compliance plan Exxon agreed to in this multi-district plea agreement is an important step in protecting migratory birds in these five states.” Colorado U.S. Attorney David Gaouette said, “We are all responsible for protecting our wildlife, even the largest of corporations.”

As we celebrate Independence Day this month, the U.S. Fish and Wildlife Service (Service) recently proposed a permitting plan for the wind generation industry that will allow up to 4,200 bald eagles, the symbol of American Freedom, and 2,000 golden eagles to be killed each year by wind generation turbines. The Service has determined that, with a national population of 143,000 bald eagles and 40,000 golden eagles, losing 4,000 bald eagles and 2,000 golden eagles each year will not push either species toward extinction.

The central issue of the Service’s wind generation permitting plan is how to protect wildlife, especially endangered species of birds, and allow the wind generation industry to grow. The Service has traditionally issued five-year permits for wind generation facilities that allow a certain number of protected birds to be killed each year—somewhere between 4,000 and 6,000—without implementing a mitigation plan. The Service wants to extend the permits up to 30 years, recognizing that building and running wind generation turbines requires a long-term financial commitment. The longer permits will provide a basis for better financing that will facilitate additional wind generation. That’s great for the wind industry, even though it might not be so great for the birds.

Wind power, one of the centerpieces of President Obama’s renewable power agenda, boasts that clean power is better for the environment, but hundreds of thousands of birds – some of which are protected or endangered – are killed by wind generation turbines each year. A study commissioned by the Service in 2013 projects that 1.4 million birds will be killed by wind generation turbines by 2030, compounded by the growth of wind generation. Like most electric generation resources, wind generation requires the difficult and often complex tradeoffs between the production of electricity and environmental impacts. It is becoming more and more obvious that wind generation is not quite as environmentally friendly as advertised.

The favoritism and preferential treatment given to renewable energy over other, more reliable forms of energy – and the government’s tendency to choose winners and losers – is more troubling. PowerSouth keeps the lights on and electric rates affordable in southeast Alabama and northwest Florida with a combination of natural gas, coal and hydroelectric power. Unlike the favorable treatment being given to wind power, the Environmental Protection Agency’s Clean Power Plan will make using fossil fuels to generate your electricity more difficult and more expensive.

The Service’s permitting plan is discriminatory. It allows the wind generation industry to avoid fines and penalties for killing hundreds of thousands of birds (some of which are protected and endangered) while ExxonMobil is fined for killing 85 birds. It’s also discriminatory because ordinary citizens can be fined $10,000 and jailed for a year for killing just one eagle. The government constantly punishing fossil fuels while promoting and subsidizing renewable energy is also a primary example of what is wrong with our national energy policy. Apparently, Colorado U.S. Attorney David Gaouette was wrong – unlike the rest of us and even the largest of corporations, the wind generation industry is not responsible for protecting our wildlife.

Electricity is a necessity of everyday life. Cheap, reliable, affordable energy is an important segment of every business and household. Yet the government gives preference to more costly and less reliable renewable energy, while penalizing the energy we can afford and trust. And, that is really for the birds.

I hope you have a good month.

I Hope You’ll Visit

June 2016

By Gary Smith, PowerSouth President & CEO

Global warming is an important concept to the electric utility industry.  Reaction to this concept has set actions in motion that will all but eliminate coal-fired electric generation, an affordable, reliable and proven resource.  These actions will also increase your cost of electric service.

Some of you have disagreed with my articles on global warming and have let me know.  A recent note said, “Isn’t the fact of global warming a reason to pause in endorsing the coal industry?  Is the almighty dollar always the bottom line? I do not think it is right to use this publication (Alabama Living) to promote that, and I am willing to pay MORE for clean energy for future generations.”

Unfortunately, not everyone is willing or able to pay more for electricity.

While I differ with the recent note on multiple points, the implication that I should not deny global warming in this publication is the most troubling.  It is a restriction on my right of free speech.  And, many others are now attempting to restrict free speech if it questions the science and economics of chasing a low-carbon energy dream.

Restricting speech or punishing opposing views is not new. Galileo Galilei was convicted by the Catholic Church in 1633 for stating that the earth orbited the sun. He was put under house arrest for the remainder of his life.  After 350 years the Church finally admitted that its conviction was in error.

As the scientific case for a global warming catastrophe becomes more doubtful, models created by the United Nations’ Intergovernmental Panel on Climate Change (the world’s presumed climate change authority) project that the EPA’s Clean Power Plan (CPP) will have minimal impact.  Specifically, those models indicate that CPP will reduce global temperatures by only 0.03 degrees and will reduce the rise in sea levels by a depth equal to the thickness of only a couple sheets of notebook paper.  This is hardly the type of return we should get for billions of dollars.

The global warming movement is now focused on silencing and punishing people who disagree with the climate change “consensus view”.  The leading advocate of the cause is Sen. Sheldon Whitehouse (D-R.I.) who has called on the Department of Justice (DOJ) to charge those who are behind a “coordinated strategy to spread heterodox views on global warming.” The senator encouraged the DOJ to utilize the Racketeer Influenced and Corrupt Organizations Act (RICO) to target climate skeptics as the scapegoats for an insufficient U.S. policy response to climate change.

Attorney General Loretta Lynch stated in recent testimony that the matter has been referred to the FBI “to consider whether or not it meets the criteria for what we could take action on.”  Additionally, Mrs. Lynch told the Committee that DOJ has discussed a civil action against the fossil fuel industry for expressing doubts about the dangers of climate change.

Other U.S. senators and state attorneys general have threatened legal action and subpoenaed oil and gas companies to release information related to climate change science, as well as lists of organizations which they have funded.  This coordinated effort is intended to suppress the First Amendment Right of Free Speech for anyone who denies that global warming is an impending danger of catastrophic proportions.

These attacks, funded by our tax dollars, are perpetrated on industries that provide oil to move billions of vehicles daily to take people to work, to shop for the necessities of life, to go to the doctor for health care; to move transportation fleets to bring groceries and goods to markets; and to keep our military mobile to protect our shores.  The attacks are on industries that provide electricity to improve our quality of life in countless ways:  to provide heating, cooling, and hot water, to refrigerate and cook our food, to energize televisions and computers, to power our hospitals and emergency rooms, and to electrify commercial and industrial businesses.  In short, these companies and their products and services provide the foundation of our entire modern life and economy.

These companies and their people have done much to build and serve our advanced and successful society, yet they are being vilified, bullied, and threatened with civil lawsuits and criminal charges by the likes of Mr. Whitehouse and Mrs. Lynch.  These companies and their people—contributors to our way of life–are hardly the gangsters, mobsters, and racketeers that RICO was designed to control.  No damage has been done, but the global warming proponents demand that the voices of these companies and their people be silenced.

I will continue to express my disagreement on expensive and fruitless efforts like the Clean Power Plan.  If Mr. Whitehouse and Mrs. Lynch put me away, I hope you will visit.

I also hope you have a good month.

Cooperative values: Where the priorities are safety and concern for the members

May 2016

By Gary Smith, PowerSouth President & CEO

Over the past couple of years I have written a number of articles on global warming and regulations the Environmental Protection Agency has imposed or is attempting to impose on the electric utility industry. I receive emails and letters about those articles. Most of the comments are positive and supportive of the positions and issues I discuss. Some even encourage me to be more aggressive and public with my positions.

However, a minority of comments are negative, critical, and at times attack me personally. The personal comments often accuse me of only following the “almighty dollar” and ruining the earth for our children.

I take offense to those personal attacks. Electric cooperatives run their businesses with the best interests of the customer-members and the communities they serve as the first priority. The corporate values of PowerSouth Energy Cooperative, in order of importance, are:

  1. Safety
  2. Member Relations
  3. Reliability
  4. Cost of Service
  5. Community Development
  6. Employee Development

 

This month I will discuss the first priority–safety for our employees, our customers and the public. Electricity is around us all the time. It makes modern life possible. We take it for granted, but it can be dangerous, even fatal.

Making, transmitting and distributing electricity is extremely dangerous. You don’t have to work for an electric utility to know that putting something other than an electric plug into an electrical outlet is very dangerous.

Electric generation is a heavy industrial process that involves high temperatures, very high pressures, heavy moving parts and dangerous chemicals. Electric transmission is high voltage with the danger of contact injuries. Electric distribution involves deadly infrastructure within the reach of ladders, antennas and poles. It is all dangerous.

We have had a number of serious accidents at PowerSouth through the years. I will never forget sitting in the funeral of a fellow employee who was killed in a workplace accident at one of our generation plants. It was one of the saddest days of my career. We don’t want that to happen to anyone else.

A foundation of safety

Electric cooperatives have made safety the foundation for their operations. They promote a culture of safety–planning the jobs safely, executing the work safely, and watching after their co-workers and the public. We have devoted resources of money and people to build an effective safety program and a work environment of safety. We have implemented safety practices around all jobs to direct work in a manner that protects people and property. We encourage workers to talk about safety and point out potential unsafe conditions. We have tailgate safety meetings before any job is started to ensure the scope of the job is understood and dangerous circumstances are discussed. We hold celebrations and provide incentives for meeting safety goals. But, we stress that a safety record is not good enough. The next accident is the one we are concerned about and the one we want to prevent.

We recognize most accidents happen because someone was in a hurry and rushed the work to save time. We stress that the job must be understood and managed in both a productive and safe manner. We ask our employees to go home at the end of every day the same way they came to work.

If our employees don’t comply with our culture of safety, we implement sanctions to ensure the safety of our employees and property are not compromised. We have made an investment in safety, and we insist our employees make an investment as well.

PowerSouth Energy Cooperative’s safety record is not perfect. We have had a couple of years without a lost-time accident. Last year we only had one lost-time accident and six recordable incidents. That record is good but not good enough. We expect zero accidents from our people.

PowerSouth and its member systems are committed to reliable and affordable service to the people and communities in our service areas. We are devoted to providing that service in a safe way for our employees, customers and the public. If you know us, you know that is what we are truly about.

I hope you have a good month.

One Life: How the death of a Supreme Court justice could affect the cost of your electricity

April 2016

By Gary Smith, PowerSouth President & CEO

The “Butterfly Effect” describes how small causes can have large effects.

It’s a concept named by mathematician and meteorologist Edward Lorenz that refers to how a butterfly in Africa might circulate air that ends up as a hurricane in the U.S.

If the beat of a butterfly’s wings can cause a hurricane, how might one person’s life change the world? The easy response is that with so many people on the planet, no one life could affect us all. But sometimes it’s clear that one life can have widespread and long-lasting effects. This idea comes to mind with the death of Antonin Gregory Scalia.

Politics, the courts, and the EPA

Scalia was a United States Supreme Court Justice who passed away on Feb. 13. He served on the Court for 30 years after his appointment by President Ronald Reagan. He was known as an outspoken judge who used humor and satire in arguing issues. He was referred to as a “textualist” because he held to the plain meaning of the text of the Constitution. He was the principal voice for conservative values on the Supreme Court.

Justice Scalia’s absence will certainly lead to more liberal decisions in several significant cases now before the Court. Those include abortion rights, affirmative action plans, voting rights and rules, the power of labor unions, contraception dissemination under Obamacare, and immigration policy.

Justice Scalia’s death will even affect issues not before the Court. His replacement must be nominated by the president and confirmed by the U.S. Senate. Republican Senate leadership has said a Supreme Court nominee will not be considered until after a new president is elected. That political strategy could affect the presidential and Senate elections this fall. Those elections will set the path for U.S. leadership for years to come.

Justice Scalia’s death increases the odds that the Environmental Protection Agency (EPA) will prevail in litigation to determine the applicability of the Clean Power Plan released last summer. Twenty-four states and hundreds of businesses and individuals sued the EPA, arguing against the agency’s authority to impose the plan.

The Clean Power Plan litigation is currently being considered by the Washington, D.C., Circuit Court. But just four days before Justice Scalia’s death, the Supreme Court issued an unprecedented stay in the case, precluding the EPA from enforcing the rule until all litigation has been resolved. The grounds for the stay were based on whether the rule would result in irreparable damage and the likelihood it would ultimately be upheld by the Court. Therefore, the logical conclusion was that five Supreme Court justices (including Justice Scalia) thought there was a considerable likelihood the rule would not withstand the lawsuit.

The future of fuel prices

However, with Justice Scalia’s death, the Supreme Court will operate with eight Justices until the president nominates and the Senate confirms a replacement. A 4-4 split by the Supreme Court would affirm the lower court’s decision. It seems likely that lower court will affirm the EPA plan, because two of its three judges are Democratic appointees. Without a conservative majority on the Supreme Court, a tie vote is likely, affirming the D.C. Circuit. Furthermore, if Justice Scalia’s replacement is appointed by a Democratic president, it is even more likely the Clean Power Plan will stand.

The Clean Power Plan would virtually eliminate coal as a fuel to produce electricity. While coal has traditionally been a low-cost fuel, lower-cost natural gas has recently replaced coal as the more economical fuel. But looking to the future, increasing demand for natural gas means its price is likely to increase. Also, a favorable ruling for the EPA on the Clean Power Plan will likely spark an EPA attack on natural gas fracking. It’s likely that the convergence of those two factors will lead to much higher natural gas prices and higher electric costs for you.

With Justice Scalia’s support, it appeared we were in a favorable position on the Clean Power Plan to maintain coal as a viable fuel to produce electricity. With his death, it appears we are not. Just like the beat of a butterfly’s wing, one life can make a difference.

I hope you have a good month.

 

Out of the Wall? There’s a lot involved in getting electricity to your home

March 2016

By Gary Smith, PowerSouth President & CEO

I speak to a number of civic clubs, and I always start with a question: Where does electricity come from?

The answers are surprising because they are so consistently wrong. The answer I get most often is, “Out of the wall.” Most people just don’t know much about electricity.

Before electricity gets into the wall it must be generated in a power plant of some type and delivered through transmission lines and distribution lines. Electricity is most commonly generated by combusting or burning some type of fuel. Fossil fuels, generally coal and natural gas, are burned to produce heat or spin turbines to make electricity. In nuclear plants nuclear fuel produces the heat. Turbines are spun in hydro dams and windmills by falling water or wind to make electricity. Electricity from the sun is generated by the reaction of sunlight across chemical elements in solar arrays.

Nationally, about two-thirds of the electricity is generated by burning fossil fuels, about 20 percent comes from nuclear generation and about 14 percent from renewables, including hydro power. About 95 percent of the electricity PowerSouth Energy Cooperative generates for your local electric cooperative comes from burning either coal or natural gas. In 2015, 69 percent of PowerSouth’s electricity was produced from natural gas, 27 percent from coal, 4 percent from hydro and 0.4 percent from renewables.

These fuels are all different in energy content, cost and application. Operators monitor load levels, fuel costs, plant generation and electricity costs minute-by-minute to provide the most reliable and most economic electric service for you.

Few people know where electricity comes from, but even fewer know how complex the process is of securing fuels, running generation plants, balancing loads, maintaining transmission lines and substations and keeping the lights on about 99.999 percent of the time. This month I will leave you with a few facts about the fuels we use to make electricity.

Each fuel is unique

Coal has been used for decades to provide a base load—a reliable and low cost supply of electricity. At one time coal provided around 80 percent of the electricity in the country. This year coal will provide less than a third of the electricity. As I’ve described in earlier columns, coal generation is under attack by the Environmental Protection Agency to reduce carbon dioxide emissions that are blamed for global warming. However, the reason the amount of coal-generated electricity has declined is not because it is not efficient or reliable, it is because the price of natural gas has dropped remarkably.

Natural gas now accounts for almost two-thirds of PowerSouth’s electric generation and is growing. Not only is natural gas cheaper than coal, natural gas generation plants are more versatile than coal plants and can be brought online more quickly to meet changing conditions.

Hydroelectric generation is cheaper to run than coal or natural gas, but the availability is limited.

Diversity is good

Just like each fuel has its advantages, each has disadvantages. Those disadvantages can be overcome by not relying on just one source, but a diverse mix of fuels, and by having the ability to switch fuels when supply or cost changes.

Coal faces environmental rules that will likely drive its cost up. Natural gas prices are low today, but have a history of sharp increases. Hydroelectric power is limited in quantity, especially when river levels fall. Wind and solar power are not available when the wind doesn’t blow or the sun doesn’t shine.

The price history of natural gas shows the importance of fuel diversity. Today natural gas is just over $2 per million BTU. But in 2008 the price was $16. If the price of any fuel increases by 8 times a utility needs the ability and flexibility to switch to another fuel.

Making and delivering electricity requires highly skilled experts

Really good people and sophisticated systems and tools coordinate the costs and fuel inputs every hour of every day to insure you have reliable and affordable electricity. Behind all the systems those really good people are working hard to keep your lights on and your homes warm. There really is a lot involved in getting electricity out of the wall.

I hope you have a good month.

Why Others Don’t Like Solar

February 2016

By Gary Smith, PowerSouth President & CEO

A couple of months ago I wrote an article titled, “Why Don’t You Like Solar?” I received a few comments to the effect that I was backwards and against progress, I was against clean energy, I was only interested in my paycheck, and I must consider Alabamians idiots.

Interestingly, on December 29, the Wall Street Journal (“WSJ”) published an article titled, “Time for Solar Energy to Grow Up.”  The article doesn’t exactly track my logic or feelings about solar energy, but it confirms my position that solar is not necessarily the answer to all of our energy questions and problems.

The WSJ article states that more than 40 states (Alabama is not one of those states) have net-metering programs for distributed generation, including solar power. (Net-metering programs allow electric consumers who own generation to sell energy to their electric provider at the retail rate.) The article states the retail price of electricity is generally about twice the cost of wholesale power because the retail price includes the cost of transmission service, distribution service, transformation costs, and maintenance of all the facilities required to provide basic electric service.

Solar programs have evolved from people interested in owning their own generation to corporate marketing plays by national companies. The WSJ article states the primary beneficiaries of solar programs are not electric consumers but companies like SolarCity and SunRun, which install solar panels at no upfront cost to customers, receiving the government tax subsidies and benefits associated with solar generation. Then, they rent the panels to consumers at rates lower-than-retail rates at the onset but typically escalate these rates by about 3 percent per year. Electric consumers may reduce their power bill at the start of the program, but non-solar customers have to make up the difference.

Customers that sell electricity back to their utilities obviously do not provide those services provided by utilities, yet they receive their utilities’ retail price. Because those customers receive payment for services they don’t provide, customers who don’t produce their own electricity have to make up the costs of the services that are paid to net-metering customers. Generally, that results in poorer electric consumers who can’t afford to install their own distributed generation to subsidize wealthier electric customers who can. Those subsidies can be substantial. The California Public Utility Commission estimates that solar subsidies among California electric consumers approach $2 billion annually. The Nevada Utility Commission estimates that Nevada non-solar customers subsidize each Nevada solar owner by $623 per year. Almost all of that shift goes to the solar leasing companies – not the solar customers.

Because of the subsidies among electric consumers, several states (including Hawaii, Arizona, California and Nevada) have recently proposed changing their net-metering programs to reduce cost-shifting among electric consumers. The Nevada Commission went even further by reducing the rate utilities pay to existing solar customers to the wholesale rate for electricity and increasing the fixed charge solar customers pay to access the electric grid.

SolarCity has not reacted well to the changes in Nevada. It announced it would cease doing business in Nevada and complained, “… the Nevada government encouraged these people to go solar with financial incentives and pro-solar policies and now the same government is punishing them for their decision with the new costs they couldn’t have foreseen.” SolarCity doesn’t mention that its disclosure statements to solar customers acknowledge the risk of rate change.

SolarCity also said, “Our ability to sell solar energy systems and the electricity they generate may be adversely impacted by changes in net-metering policies, including reductions in the amount or value of credit that customers receive though net-metering.” However, the change should have little effect on what solar customers receive from their solar installations. It will primarily affect SolarCity’s profits and the amount non-solar customers have to pay to subsidize the solar customers.

Non-solar customers should not have to pay for decisions made by solar customers. The federal government recently extended the 30 percent tax credit for solar installations through 2021 so our tax dollars can be used to subsidize solar choices. There is no reason states should continue to double down on subsidies that benefit SolarCity and other solar companies at the expense of retail consumers.

Just another reason not to like solar. I hope you have a good month.