Environment – Page 137 – The Tarbabys Blog

Saskatchewan driller hits ‘gusher’ with ground-breaking geothermal well that offers hope for oil workers

Financial Post

Saskatchewan driller hits ‘gusher’ with ground-breaking geothermal well that offers hope for oil workers

A first for Canada and the world, the well can produce enough electricity to power 3,000 homes

Geoffrey Morgan Nov 27, 2020

DEEP Earth Energy Production Corp.’ site is the deepest horizontal well in Saskatchewan’s history and the first 90° horizontal fluid production for geothermal power generation in the world. PHOTO BY DEEP EARTH ENERGY PRODUCTION CORP.

CALGARY — A small, Saskatoon-based company has drilled and fracked the world’s first 90-degree horizontal well for geothermal power in a potentially landmark move that signals the arrival of a new energy source in Canada and provides fresh opportunities for oil and gas workers to apply their skills in renewable power.

No company in Canada has produced electricity from geothermal heat, but Deep Earth Energy Production Corp. chief executive officer Kirsten Marcia told the Financial Post that there’s a “big, big future for geothermal power in Western Canada,” as demonstrated by the results of the first ever horizontal geothermal well, which is also the deepest horizontal well ever drilled in Saskatchewan.

“We were looking for a way to explain to people that we drilled a gusher,” said Marcia, a geologist who worked in the mining and petroleum industries before pioneering a geothermal business in Saskatchewan. In the oil and gas world, a “gusher” is an extremely productive well that pumps substantial volumes of oil and gas.

The well is a first for the global geothermal industry

In Canada’s nascent geothermal power industry, Deep’s “gusher” can produce steaming-hot water and brine with a temperature of 127 degrees centigrade at a rate of 100 litres per second. Marcia said those flow rates mean the well will actually be limited by the hardware, such as pump capacity, that are connected to the wellhead. She said the well, called the Border-5HZ well, is capable of producing 3 megawatts of renewable, reliable electricity, enough to power 3,000 homes.

The well will form part of a larger 20MW geothermal power project, which is expected to commence construction in 2023 in southern Saskatchewan close to the U.S. border.

The well is also a first for the global geothermal industry.

DEEP Earth’s Border-5HZ well in Saskatchewan is capable of producing 3 megawatts of renewable, reliable electricity, enough to power 3,000 homes. PHOTO BY DEEP EARTH ENERGY PRODUCTION CORP.

Directional geothermal power wells have been drilled in California, but Marcia said those were drilled at a 75-degree angle, rather than being truly horizontal. Her company’s Border-5HZ well was drilled into the earth at a depth of 3,450 metres before turning at a 90 degree angle and drilling through sedimentary rock along a 2,000-metre lateral route.

“This is a sedimentary geothermal project. There aren’t a lot of them in the world,” Marcia said, noting that most geothermal power projects, including those in world-leading Iceland, drill vertically into volcanic rock formations. “In terms of drilling into a sedimentary basin, you’re drilling into sedimentary units that are like a stack of pancakes.”

Deep is also responsible for the deepest vertical well ever drilled in Saskatchewan, after announcing in Nov. 2018 it had drilled a 3,530-metre well.

Governments in Alberta and Saskatchewan have been revamping regulations for drilling and for power generation in an attempt to stimulate geothermal power investment in their provinces partly because the geothermal industry uses many of the same skills as the existing oil and gas industry.

This week, Alberta MLAs passed legislation that will allow the province’s energy regulator to develop a new framework for geothermal wells to be licensed and drilled in the province. The bill is considered a way to keep oilfield services workers, such as drillers, working as investment in renewable energy is projected to rise in the coming years.

Everything we’re doing is figuratively and literally on the backs of these highly skilled oilfield workers. We couldn’t do this without this expertise in this part of the world

DEEP EARTH ENERGY CEO KIRSTEN MARCIA

While other geothermal wells have been drilled in Canada previously to channel heat directly from the earth, Deep and a handful of other companies are among the first in the country to use the earth’s heat to generate electricity.

In Alberta, Calgary-based oil and gas producer Razor Energy Corp. is working on a geothermal project north of Edmonton that would retrofit existing wells to produce 3MW to 5MW of geothermal power.

Near Fort Nelson, B.C., a natural gas-rich town, a non-profit research association called Geoscience BC is undertaking a feasibility study of the Clark Lake Geothermal project that would repurpose a gas field to produce geothermal power.

Kirsten Marcia, president and CEO of Deep Earth Energy Production Corp. PHOTO BY TROY FLEECE/POSTMEDIA

At Deep, Marcia said it’s very difficult to repurpose existing oil and gas wells to produce geothermal power because the diameters of most existing wells are too narrow for the tubing that geothermal wells need to pump water in a cycle through the earth’s crust.

However, geologists have identified multiple locations in Western Canada to produce geothermal power and use existing oil and gas skills in renewable power production, Marcia said.

Over 100 oilfield workers were on site to drill and hydraulic-fracture her company’s horizontal well in southern Saskatchewan in September and October, including a drilling crew from Houston-based Weatherford International Plc, and a pressure-pumping team from Saskatchewan’s Element Technical Services Inc.

“It’s amazing. Everything we’re doing is figuratively and literally on the backs of these highly skilled oilfield workers. We couldn’t do this without this expertise in this part of the world,” said Marcia.

She added that the project was de-risked in part by funding from the federal government, which committed $25.6 million in funding in January 2019 for the project. All told, the geothermal power project is expected to cost $51 million.

Army Corps of Engineers issues Enbridge permit for $2.6B pipeline across northern Minnesota

Star Tribune

Army Corps of Engineers issues Enbridge permit for $2.6B pipeline across northern Minnesota

The permit is last big hurdle for the construction project, which will be one of largest in recent history for Minnesota.

By Mike Hughlett, Star Tribune November 24, 2020

Two Minnesota regulators granted environmental permits for Enbridge’s Line 3 oil pipeline across northern Minnesota, critical approvals needed for construction to begin soon on the controversial $2.6 billion project, on Thursday, Nov. 12, 2020. (Richard Tsong-Taatarii/Minneapolis Star Tribune/TNS) ORG XMIT: 1826898.

The Corps decision paves the way for Calgary-based Enbridge to begin building the pipeline as early as next month. It will be one of the largest Minnesota construction projects in recent history and is expected to employ 4,000 workers.

“This decision is based on balancing development with protecting the environment,” Col. Karl Jansen, St Paul District commander, said in a statement. “Our decision follows an exhaustive review of the application and the potential impacts associated with the construction of the pipeline within federally protected waters.”

The Corps’ blessing was expected after the Minnesota Pollution Control Agency (MPCA) this month approved related construction permits for the pipeline, a replacement for Enbridge’s current Line 3.

The federal permit, issued by the Army Corps’ St. Paul district, covers construction impacts to myriad water bodies in Minnesota. The pipeline will ferry heavy Canadian oil across northern Minnesota to Enbridge’s terminal in Superior, Wis.

The 340-mile new pipeline will cross 212 streams and will affect more than 700 acres of wetlands in Minnesota — the reason many environmental groups have fought the project throughout the regulatory process.

“Enbridge has now received all remaining federal permits required for replacing Line 3, an essential maintenance project,” the Calgary-based company said in a statement.

The MPCA must still grant a stormwater drainage permit to Enbridge, a more routine approval that’s expected in the coming weeks. Enbridge is also waiting on a final construction authorization from the Minnesota Public Utilities Commission (PUC), which already has approved the project.

“We are prepared to start construction as soon as these are in hand,” Enbridge said.

The Army Corps was waiting for the MPCA to act on the more sweeping pollution permits before making its decision. The MPCA two weeks ago granted water quality permits related to Line 3 construction.

The pipeline has been winding through the Minnesota regulatory process for six years. The PUC, the state’s primary regulator of pipelines, approved the pipeline in February for the second time after a court sent it back to the panel for changes in the project’s environmental impact statement.

Environmental groups and Indian bands opposing Line 3 have already appealed the PUC’s decision to a state appellate court, and petitions to overturn the Corps’ permits may be in the offing, too.

“It’s tragic but it’s not a surprise that the Trump administration would approve these permits regardless of the water quality impacts from the pipeline, and during a time when a pandemic is sweeping across the North Country with workers already here,” Winona LaDuke, head of Indigenous environmental group Honor the Earth, said in a statement. “The tribes and others will surely sue and we will see them in court.”

Environmental groups and some Indian bands have said the pipeline — which follows a new route — will open a new region of pristine waters to the prospect of oil spills, as well as exacerbate climate change by allowing for more oil production.

Enbridge has said the new pipeline is a critical safety enhancement. The current Line 3 is so corroded it’s running at only half capacity. The new pipeline would restore full oil flow.

Jansen said the Army Corps staff consulted all parties on Line 3, working “deliberately and extensively with our federal and state partners, federally recognized tribes, environmental organizations and the applicant.”

Mike Hughlett covers energy and other topics for the Star Tribune, where he has worked since 2010. Before that he was a reporter at newspapers in Chicago, St. Paul, New Orleans and Duluth.

Meet the South Poll cow: the healthier, naturally raised cattle of the future?

The Guardian

Meet the South Poll cow: the healthier, naturally raised cattle of the future?

Georgie Smith November 25, 2020

Missouri rancher Greg Judy spots a six-month-old South Poll heifer calf in his herd that is a prime example of what he calls a “good doing cow”. A cow that will “do good” on grass alone.

She’s got a “big butt”, Judy says, meaning wide hips that will help her easily bear calves when grown. She sports a shiny, slick red hide that flies avoid landing on; cows stressed from fly bites – Judy has seen hundreds on a single cow – don’t grow well. She has a large “barrel” or gut, meaning enough stomach capacity to store large amounts of grass, which she will convert to energy and will keep her in good health, even during the winter with no extra feed. “This is the kind of heifer you want,” Judy says. “You can build a herd out of those.”

Judy raises cattle in a highly–managed, grass-only system that he believes is better for his cows and the environment. His 300-plus herd is kept together in a dense group, and moved often – Judy moves his cattle twice a day to fresh paddocks – creating a symbiotic relationship between cows and grasslands that soil scientists are finding encourages soil health and rapid grass growth.

But Judy has learned not all cows thrive on grass alone, especially the type of cattle favored by a US ranching industry that has grown largely dependent on feeding cattle grain rations.

In Judy’s system, those “common cows”, as he calls them, looked like they had been starved six months after he put them on a grass-only diet. Instead, Judy found success – after nearly going bankrupt in 1999 trying to raise cattle the conventional way – utilizing intensive, grass-based management with cows that had the “grass genetics” to thrive.

“At the end of the day, the money comes from animals that can excel on a grass diet,” says Judy, referring to the lower costs of raising cattle with a genetic predisposition to thrive on grass, since they don’t require the grain, growth hormones and antibiotics often used in traditional cattle ranching.

It’s a counterintuitive problem, considering cows evolved to eat grass. But today, approximately 97% of US beef cows spend the last four to six months in confined feedlots where they are fed grain rations until slaughter. Before that, they spend most of their lives out on the pasture, but even then some ranchers feed them grain to keep their weight up through winter or during stressful times like calving.

Meanwhile, the grass-only beef market is small, but growing rapidly, according to a report by Stone Barns Center. The intensively managed grazing Judy employs is a supercharged version of traditional cattle-grazing techniques. By moving his cows often, they do not have a chance to damage the grass by eating it too short. Instead, they encourage healthy root development increasing soil health, which some scientists have found allows the soil to capture and store carbon from the atmosphere – a process known as carbon sequestration.

This heavily managed grazing style – also called holistic grazing – is part of a growing worldwide interest in “regenerative agriculture”. By promoting multiple practices that build soil health, regenerative agriculture has been said to improve agricultural lands and ultimately sequester carbon, according to Rattan Lal PhD, an Ohio State University soil scientist and the 2020 World Food Prize winner.

But the growth of regenerative grazing systems has been slow, in part because, as the cattle industry turned to feeding grain, ranchers ended up breeding fewer cows that could thrive on grass alone, says Richard Teague PhD, a range ecologist with the Texas A&M University Agrilife Research center. Ranchers like Judy were put in a pickle, without the cows appropriate for their grass-only systems.

“People wanted to feed corn, [so] they bred huge animals that require very big inputs of corn and also pharmaceuticals,” says Teague. He argues that raising “cattle like that” comes at the expense of the health of consumers – and the health of the soil that nurtures them. “We have to go to animals that we know thrive under good management.”

The traditional ranching industry denies the charge that grass-raised cows are better for the climate than their grain-fed product. In a 2017 study by Oklahoma State University researchers found that grain-fed cattle – with their shorter lifespans – resulted in a 18.5 to 67.5% lower carbon footprint compared with grass-finished beef.

Meanwhile, a 2017 report from the Food, Climate and Research Network challenged the idea that grass-fed beef can be good for the environment at all, saying there was no evidence that grazing cattle helps sequester carbon except under the most ideal conditions.

However, Teague argues, “It’s not the cow, it’s the how.” A 2015 study in Georgia of dairy cows in an intensively grazed system recorded eight tons of carbon sequestered per hectare annually. The intensive livestock grazing systems such as Judy uses are one of the best ways within agricultural systems to sequester carbon, according to Teague. “Under decent management, sequestration exceeds emissions, and the better the grazing management, the more it exceeds it.”

For Judy, it comes down to raising cattle in a system that works with nature instead of against it. But to do that, he also had to find the best cattle to thrive in his environment. For him, that perfect cow is the South Poll.

A relative newcomer to the beef cattle scene, the South Poll is a small-framed, stout, highly fertile red cow, well adapted to hot and humid conditions. It has good mothering instincts that have earned it the nickname the “southern mama cow”. The breed also has a rock star – or at least, country music star – cachet; it was originally developed in the 1990s by Teddy Gentry, the bass player for the country music group Alabama.

Judy is far from alone in his enthusiasm for this up-and-coming breed. In mid-September, South Poll cattle fans from all over the US showed up in Copan, Oklahoma, for the annual South Poll cattle auction. The cows are becoming increasingly popular with grass-focused ranchers – especially in the south-eastern and mid-western US where the cattle are best adapted – according to Ann Demerath, secretary of the South Poll Grass Cattle Association.

Some of the animals purchased at the auction may be cross-bred with other cattle breeds. Ranchers hope to use the South Poll genes to adapt their existing cattle to do better on a grass diet, Judy says. He advises ranchers to start by purchasing the “best South Poll bull you can afford” and breed it to the best females in their existing herd. Then, ranchers should select the best females from that generation and breed those with a South Poll sire – a technique called “line-breeding” that quickly focuses on desirable traits without risking genetic defects.

Judy also advises ranchers to cull – or remove – any animals that don’t fit their standards for health and disposition, even if they “look at you funny”, from their breeding stock. His mantra? “You’ll never have a herd any better than what you are willing to cull for.”

Relentlessly selecting for the best-adapted cows within his own system has allowed Judy to produce South Poll mother cows so well-adapted that they stay healthy through the winter. That means, unlike most ranchers, Judy can give the mothers more time with their calves during the winter, which gives those calves an extra boost of growth and leaves him with a stronger, bigger calf in the spring.

For Judy, that is the goal – a cow that needs nothing but well-managed grass, passing their health and wellbeing on to the next generation.

“The animals,” Judy says, “are just healthy.”

A destructive legacy: Trump bids for final hack at environmental protections

The Guardian

A destructive legacy: Trump bids for final hack at environmental protections

Oliver Milman November 21, 2020

Photograph: Nicholas Kamm/AFP/Getty Images

Donald Trump is using the dying embers of his US presidency to hastily push through a procession of environmental protection rollbacks that critics claim will cement his legacy as an unusually destructive force against the natural world.

Trump has yet to acknowledge his election loss to president-elect Joe Biden but his administration has been busily finishing off a cavalcade of regulatory moves to lock in more oil and gas drilling, loosened protections for wildlife and lax air pollution standards before the Democrat enters the White House on 20 January.

Trump’s interior department is hastily auctioning off drilling rights to America’s last large untouched wilderness, the sprawling Arctic National Wildlife Refuge found in the tundra of northern Alaska. The refuge, home to polar bears, caribou and 200 species of birds, has been off limits to fossil fuel companies for decades but the Trump administration is keen to give out leases to extract the billions of barrels of oil believed to be in the area’s coastal region.

The leases could result in the release of vast quantities of carbon emissions as well as upend the long-held lifestyle of the local Gwich’in tribe, which depends upon the migratory caribou for sustenance. Several major banks, fiercely lobbied by the Gwich’in and conservationists, have refused to finance drilling in the refuge but industry groups have expressed optimism that the area will be carved open.

An airplane flies over caribou on the coastal plain of the Arctic national wildlife refuge in north-east Alaska. Photograph: US Fish and Wildlife Service/AP

The administration is also opening the way for drilling around the Chaco Canyon National Historical Park, considered a sacred area by the native Navajo and Pueblo people who live near the New Mexico site and has targeted a linchpin environmental law, known as the National Environmental Policy Act, to allow more logging and road-building in national forests.

Trump has previously shrunk federally-protected areas as part of an “energy dominance” mantra that the president claims will bolster the US economy.

Meanwhile, safety rules for offshore drilling, put in place after the disastrous 2010 BP oil spill in the Gulf of Mexico, are being watered down. The risks of a catastrophic, unrestrained spill are highest in the Arctic, where retreating sea ice is encouraging some fossil fuel firms to move into a region largely devoid of clean-up and rescue infrastructure.

The Trump administration is is also maintaining air quality standards widely condemned by experts as being insufficient to protect communities from sooty pollution that comes from cars, trucks and heavy industry. Many cities in the US are riven with environmental injustices, where poorer communities of color are routinely placed in proximity of industrial plants, highways and other sources of pollution.

Vehicles drive on the 101 freeway in Los Angeles, California. Photograph: Robyn Beck/AFP/Getty Images

The regulatory rampage extends to creatures from the skies to the prairies to the oceans – fines for people who kill migratory birds are being reviewed while the US Navy has been given latitude to inadvertently harass endangered whales with noise from explosions and speeding vessels during war game exercises along the west coast.

A plan to slash protections for sage grouse across the US west has been finalized, placing the habitat of the once-common bird, about the size of a chicken and known for its flamboyant mating dances, at risk. “These guys are hellbent on turning over the last refuges of the vanishing greater sage grouse to drilling, mining and grazing,” said Michael Saul, a senior attorney at the Center for Biological Diversity. “It’s disgusting, transparent and illegal.”

The Trump administration spent four years assaulting every protection for our air, water, lands, wildlife and climate

Jill Tauber

The actions of the exiting administration will have “extremely damaging environmental consequences”, said Richard Revesz, a professor of environmental law at New York University. “Trump’s counterproductive actions have allowed the climate crisis to intensify and put the health of many Americans, especially in the most vulnerable communities, at risk by ignoring threats from pollution,” he added.

The scorched earth approach of Trump’s final months will further exacerbate a four-year legacy where climate policies have been dismantled, clean air and water rules scaled back and legions of demoralized federal government scientists sidelined or decided to quit.

“The Trump administration spent four years assaulting every protection for our air, water, lands, wildlife and climate,” said Jill Tauber, vice-president of litigation at Earthjustice, a non-profit law organization.

People visit Griffith Observatory on a day rated ‘moderate’ air quality in Los Angeles, California, in June 2019. Photograph: Mario Tama/Getty Images

Leah Donahey, legislative director at the Alaska Wilderness League, added: “No administration has been worse for our environment or our nation’s public health than this one.”

Biden will be able to reverse some of Trump’s actions and has vowed to limit drilling on federal land as well as to rejoin the Paris climate agreement, which the incumbent has removed the US from. Biden has called the climate change an “existential threat” in the wake of a year of fierce wildfires in California and a record number of hurricanes in the Atlantic, but his ambition to pass sweeping climate legislation hinge upon a US senate that, with looming special elections in the state of Georgia, appears likely to remain in Republican control.

Any successful remediation of the rollbacks will also have to survive as flurry of lawsuits, with the US supreme court now titled decisively in a conservative direction. All of this will soak up time during a period where scientists say planet-heating emissions must be cut rapidly to avoid the worst ravages of the climate crisis. “Trump’s legacy on environmental issues will be less about lasting policy changes,” said Revesz, “and more about lost time and missed opportunities.”

Wind and solar now cheaper than natural gas

But before you get too excited and decide to cut off your natural gas supply, what hasn’t changed is the unreliability of both solar and wind

Licia Corbella Nov 21, 2020

A power-generating wind turbine is reflected in solar panels on March 10, 2010. PHOTO BY REUTERS/THOMAS BOHLEN/FILE.

We all remember the disturbing stories coming out of Europe as little as two years ago called the heat or eat phenomenon. The push towards renewable energy contributed to large spikes in electricity costs that seniors and other people on low incomes in the U.K., in particular, were forced to choose between heating their homes or eating.

Even in Ontario, that province’s push under previous provincial governments to bring in more solar and wind power caused prices to rise so much that it helped lead to the defeat of Kathleen Wynne’s provincial Liberal government.

According to a new report from the University of Calgary, however, that era of high-cost renewable energy is over.

The School of Public Policy report on energy and environmental policy trends, Cheap Renewables Have Arrived, has found that solar and wind power prices have plunged so precipitously that they are now less expensive than efficient natural gas plants.

Recent analysis shows that over the past 10 years, wind costs have fallen by 70 per cent and solar by 90 per cent.

“Perhaps more significantly, the levelized cost of wind and solar — a measure which includes cost to construct and operate power plants — has now reached parity with the marginal cost of efficient natural gas plants,” write co-authors Nick Schumacher, Victoria Goodday, Blake Shaffer and Jennifer Winter.

“This suggests building new renewables is now cheaper than operating existing fossil power plants.”

Shaffer, an energy economist and an assistant professor of economics, says the perception for people who aren’t “electricity nerds” is that solar and wind power is a kind of “boutique power” — costly and niche.

“For many people who are thinking back about five years ago, certainly 10 years ago, and hearing about the cost of solar and wind and, you know, runaway electricity prices in Ontario, we still have that in mind because that’s not long ago,” said Shaffer during a Wednesday interview. “But it’s just changed so dramatically that’s no longer the case. Wind and solar is now cheaper than natural gas.”

Now, before you get too excited and decide to cut off your natural gas supply, what hasn’t changed is the unreliability of both solar and wind. Basically, you only get wind power when the wind blows and solar power when the sun shines.

But Shaffer says with more countries committing to net-zero emissions targets — including Prime Minister Justin Trudeau’s announcement on Thursday that pledged Canada to net-zero greenhouse gas emissions by 2050 — the push will be on to find ways to store this “zero-emission power” to be used when demand is highest — primarily through batteries, which are currently costly and not so green.

“Despite their low costs, wind and solar still have a long way to go before they are the dominant sources of energy,” states the report.

“In 2018, renewables accounted for only 8.5 per cent of total global energy supply. Despite their small share of supply, renewable energy investment growth — 97 per cent of which is in wind and solar — is outpacing any other energy source at 7.6 per cent per year.”

The report points out that even the International Energy Agency’s World Energy Outlook 2020 report — which tends to be highly conservative — declared: “Solar is the new king of electricity.”

Shaffer says the rapid decline in the cost of solar panels was caused by the demand for them in Germany, California and other European countries and particularly now that China has taken the lead on production.

“So, the renewables are now the cheapest in terms of producing electricity, but it still doesn’t give us the on-demand power we want. And so just looking at cost alone isn’t fair. We need to figure out how to turn that raw energy into on-demand power.”

Shaffer notes that just recently TransAlta put in a large Tesla battery to store renewable energy and California and South Australia are doing the same.

He anticipates that natural gas will continue to play an important role in electrification to fill in the valleys caused by the intermittent nature of solar and wind for some time to come.

Solar panels atop the Southland Leisure Centre in Calgary in 2014. At the time, it was the city’s largest solar array. PHOTO BY POSTMEDIA ARCHIVES

In October, Premier Jason Kenney announced a new strategy for Alberta’s massive 300-year supply of natural gas, including net-zero hydrogen exports, something that Shaffer believes will be in high demand in the world.

Indeed, the hydrogen industry is projected to be worth $2.5 trillion by 2050, according to the Hydrogen Council, a global group of corporate executives encouraging investment in the hydrogen economy.

So, are solar and wind the game-changers that replaces oil and gas?

“No, they’re not,” says Shaffer. “It’s not the same scale. But what it is is it’s a great opportunity to replace a lot of generation to reduce emissions at really low to no cost.”

He says Alberta is “blessed with all of these great energy resources, and it just so happens that we also have some of the best wind resources in Canada. You go down to Pincher Creek, you’ll agree with me. We also have the best solar resources in Canada, us and southern Saskatchewan.”

“There’s nowhere cheaper in Canada to build solar and wind than in Alberta.”

The greening of the electrical grid no longer will force people to choose between heating or eating. It will, hopefully, one day soon be about cleaner air and net-zero greenhouse gas emissions at a reasonable cost.

Alberta sees an energy transition ‘happen before our eyes’

Varcoe: Alberta sees an energy transition ‘happen before our eyes’

Chris Varcoe Nov 21, 2020

Chief Allan Adam, Athabasca Chipewyan First Nation. PHOTO BY NICK KENDRICK, GREENPLANET ENERGY ANALYTICS

For the 1,000 residents of Fort Chipewyan, it has already started to arrive.Earlier this week, the community officially announced the completion of a new solar project that will generate up to 25 per cent of its electricity needs.

The northern community isn’t connected to the province’s power grid; the nearest tie-in to Alberta’s electricity system is 150 kilometres away.

Solar energy will help reduce Fort Chipewyan’s reliance on diesel that can only be trucked in on an ice road during the winter.

“Knowing that we have a different option in place of diesel fuel, it’s quite exciting. The opportunities are there for jobs and a cleaner way of heating our community,” Blue Eyes Simpson, vice-president of the Fort Chipewyan Metis Association, said Thursday in an interview.

“We’ve shown the world things like this can happen, even in the smallest of communities.”

The project, a partnership involving ATCO Ltd. and Three Nations Energy (3NE) GP Inc., is noteworthy for a number of reasons. It’s the largest remote off-grid solar generating development in the country.Using solar power will reduce greenhouse gas emissions by cutting local diesel consumption each year by an estimated 800,000 litres.

A fuel truck drives down the winter ice road from Fort McMurray to Fort Chipewyan in Northern Alberta on February 4, 2015. The 200-km temporary road typically opens mid-December and closes mid-March depending on the weather. PHOTO BY RYAN JACKSON/POSTMEDIA

The Athabasca Chipewyan First Nation (ACFN), Fort Chipewyan Metis Association and Mikisew Cree First Nation are joint partners in 3NE, which owns the 2,200-kW solar farm located near the community’s airport.

The $7.8-million project, which included funding from the province and Ottawa, will generate about $200,000 to $250,000 annually in revenues, said Jason Schulz, 3NE president and the ACFN’s director of strategic advisory services.

ATCO built a 600-kW solar farm last year that’s adjacent to the larger facility and both developments will feed the company’s 1.5 megawatt-hour battery storage system.

“It really was a way to help the community achieve their climate change goals … and have less trucks rolling diesel into the community,” said Melanie Bayley, ATCO’s senior vice-president.

“This time of year, there is not a lot of sunshine. But come the summer months, there’s a great deal of solar potential there.”

The project also speaks to the ongoing energy evolution and efforts in Alberta to decarbonize.

Several oilsands producers, including Cenovus Energy and Canadian Natural Resources, have set goals to achieve net-zero emissions in three decades.

The cost of renewable energy technology continues to drop. Alberta, with strong wind and solar resources, is attracting outside investment.“We certainly are seeing the energy transition happen before our eyes,” said Bayley.

Earlier this month, a report by International Energy Agency said wind, solar and other renewable sources will make up almost 90 per cent of the global increase in total power capacity this year.

“Solar … and onshore wind are already the cheapest ways of adding new electricity-generating plants in most countries today,” the report stated.

Canada’s first wind-energy instalment, built in 1993, is nestled in the Alberta Rockies overlooking Pincher Creek. PHOTO BY POSTMEDIA ARCHIVE

In Alberta, as coal-fired power generation is being phased out, much of it is being replaced by natural gas, which generates fewer emissions and can back up intermittent renewable supply.

A number of renewable energy projects are also moving ahead, including the largest solar development in the country.

The Travers Solar Project, southeast of Calgary in Vulcan County, will generate 465 megawatts (MW) of electricity from 1.5 million solar panels once it’s built.

Construction on the $750-million Travers project, which is being developed by Calgary-based Greengate Power Corp., is expected to start in the first half of next year, said CEO Dan Balaban.

He noted a push by companies to source their electricity needs from clean energy will drive future renewable expansion in Alberta, which has the only deregulated electricity market in Canada.

“The energy discussion has been way too polarized in his country. It’s been framed as oil and gas versus renewables and I really believe it is oil and gas — and renewables,” Balaban said.

“That said, there is an energy transition going on around the globe and … coming out of COVID, it seems like the global appetite for clean energy investment has just accelerated.”Battery storage projects are also starting to lift off in Alberta, with 10 proposed developments being advanced.

The new Windcharger battery storage project being development by TransAlta Corporation is seen near Pincher Creek. The project has been under development this year and will begin operating later this month. PHOTO BY PHOTO COURTESY TRANSALTA CORPORATION

Last month, TransAlta began commercial operations on its $14-million WindCharger project northeast of Pincher Creek, Alberta’s first utility-scale lithium-ion battery storage facility.

TD Asset Management announced in October its Greystone Infrastructure Fund has invested in the country’s biggest battery storage development, located in Alberta. It said the first of three 20 MW storage projects will be in service by next month.

There are other signs of changes underway, such as the launch this week of a new clean energy accelerator, training program and venture fund by Calgary-based Avatar Innovations Inc.

Kevin Krausert, former head of Beaver Drilling and now CEO of Avatar Innovations, said the downturn in the oilpatch has caused devastation in the industry.

Yet, the sector remains the economic engine of the province and there are opportunities to use Alberta’s energy expertise to expand in areas such as hydrogen, geothermal or developing emissions-reduction technology.

“It’s always been the story and the history of our industry and province to look at the challenges that face us and find opportunities,” Krausert said Friday.

“I wish I could go back to 2014 as well. It’s easier to solve the challenges in front of us and create opportunity than it is to figure out how to create a time machine.”There’s also another reality to keep in mind: independent forecasts show oil and gas will continue to be a major energy source for decades to come.

Last month, the IEA’s annual energy outlook report said under its base-case scenario, global demand for natural gas will rise by 30 per cent by 2040. Oil consumption is forecast to return to pre-pandemic levels of around 100-million barrels per day in five years and stabilize around 104-million barrels per day in two decades.

For Schulz, the solar project in Fort Chipewyan holds a lesson that is relevant for all Albertans during a period of change. Many forms of energy will be needed moving forward.

“You can still have your traditional fossil fuels because they play a role … but you can also embrace a rapidly evolving economic model presented by renewables,” he said.

“It’s a matter of embracing both.”

Chris Varcoe is a Calgary Herald columnist.

How hyperlocal hydro energy can empower communities

Grist.org

How hyperlocal hydro energy can empower communities

By Grist Creative Nov 11, 2020

This article is published in partnership with: Vertue Lab

Water Pipeline Of Hydroelectric Power Plant

Getty Images

Growing up in Colombia, Moriel Arango spent nearly every weekend on his father’s sustainable farm, about an hour from their home in the city of Cali. There, in the rural, western region of the country, prolonged power outages were common and reliable electricity could be scarce. Once, a lightning strike blew out a transformer in the middle of the night. This shut off the power to an aerator that supplied oxygen to thousands of red tilapia and cachama he was raising in lakes on the property.

“In these rural areas, you lose power and it’s going to be 48 hours or more,” Arango says. “All his fish are going to die.”

So Arango’s father had to make the hour-long drive during the night to bring a can of diesel to start up the backup generator and get the aerator running again. It’s experiences like these that eventually led Arango to BladeRunner Energy, a renewable energy company based in Bend, Oregon.

“It’s always been a big motivator for me—” he says, “looking at renewable energy, and the idea of getting it into the hands of folks that need it.”

The current moment, for all its upheaval and uncertainty, presents a unique opportunity for making big, systemic change when it comes to energy. BladeRunner, along with InPipe Energy, another Oregon-based startup, think the time is ripe for investing in hyper-local hydropower. Both are VertueLab-supported companies. InPipe captures excess energy flowing through municipal drinking water pipes, while BladeRunner replaces the environmental risk of hydroelectric dams with small, tethered turbines to harvest the energy of flowing water.

These types of small-scale, dispersed energy sources could help put much-needed power into the hands of communities — literally and figuratively.

“Electric utilities are inundated with innovation. Water departments, not as much,” says Gregg Semler, InPipe’s president and CEO. He’s working to change that.

As a city’s water makes its downhill journey from a water tower to the tap, pressure within a pipeline often becomes too high. Pressure-reducing valves situated along the pipeline help maintain a critical balance: Extra force from over-pressurized water can cause costly leaks or major water main breaks.

“Water is invisible. It’s underneath our streets, and we take it for granted when we turn on the tap that it comes out at the right pressure,” Semler says.

InPipe’s technology capitalizes on existing pressure control valves, adding sensors to monitor precise flow and pressure within a pipe. When pressure starts to rise, water is diverted through a small pipe called a bypass, where it spins a series of microturbines before flowing back into the main pipe. The excess pressure is converted into energy, which can then be fed into a city’s electrical grid.

In October, InPipe completed its first partnership with a city, in Hillsborough, Oregon. It’s one of three pilot projects planned across the West. Funded with help from Portland General Electric and Energy Trust of Oregon, InPipe’s technology will help power lights, concession stands, and electric vehicle charging stations at the city’s recreation complex, generating between 185,000 and 200,000 kWh of electricity per year. The clean energy generated will reduce the city’s carbon footprint by more than 162,000 pounds annually—the equivalent of driving a car more than 240,000 miles.

Moving forward, Semler sees InPipe as an avenue for water equity around the country. Water may be our most important resource, but it is delivered via an aging infrastructure — the very pipes that deliver the nation’s water are crumbling and in need of serious repair. There are roughly 240,000 water main breaks a year, according to the American Society Civil of Engineers, resulting in more than 2 trillion gallons of lost drinking water annually.

And while tragedies in cities like Flint, Michigan, and Newark, New Jersey, have made national headlines for exposing dangerously high levels of lead in residents’ pipes, unsafe drinking water still threatens millions of people across the country.

To make the needed fixes and additions to the country’s water system would cost at least $1 trillion, as estimated by the American Water Works Association. Replacing lead service lines alone could cost as much as $50 billion. Semler hopes that monetizing water pressure, reducing leaks and pipe damage, and generating clean energy in the process might incentivize cities to invest in much-needed upgrades.

“We can tap into sources of capital for water departments, and that capital can be used to upgrade their infrastructure,” Semler says. “The benefit is that we produce energy around the clock.”

Moriel Arango, co-founder and CTO of BladeRunner Energy, has long been driven by the idea of energy equity as well. During his childhood in Colombia, he saw firsthand the types of socioeconomic disparities that can prevent communities from thriving: systemic poverty alongside extreme wealth, as well as Indigenous and Afro-Colombian villages displaced by violent drug trafficking and unrest.

“All of those things, they compound and add up to a motivation for me to continue down that path of helping others become empowered,” Arango says. Which is why he joined BladeRunner Energy in 2017.

BladeRunner’s hydrokinetic rotors are tethered to floating generators. They’re designed to float in waterways and provide power for isolated communities in landscapes that aren’t conducive to large-scale renewable energy infrastructure like solar fields, wind turbines, or dams. The company’s current rotors measure 20 inches in diameter, which are best-suited for shallow, fast-moving waters, like a stream. But as testing progresses, Arango would like to scale up to rotors as big as five feet across. These larger rotors could be used to generate power in the deeper, slower currents of a river.

So far, BladeRunner has tested its prototype in canals throughout the Central Oregon Irrigation District, in Tomales Bay, California, and in controlled environments at facilities at the University of California, Berkeley; University of California, Davis; and California State University, Chico. They’re waiting to hear about the status of federal grant money for a collaboration with the University of Alaska Fairbanks over the next several years. The partnership would scale additional testing in rural villages, where diesel generators remain a primary supplier of heat and electricity.

Eventually, Arango envisions his tethered rotors being a complement to microgrids — the hyperlocal, autonomous energy grids that are often used to power rural or especially remote locations. Roughly 12 percent of the world’s microgrid systems operate in Alaska, hence the hope to continue prototype testing there.

In Arango’s view, the benefits of clean energy equity extend beyond environmental sustainability. It’s about giving communities the resources needed to help them reach their potential.

“If we had a world where everybody had general equal access to education and electricity, the next thing you know, you have brilliant minds popping out of everywhere,” he says. “The brilliant minds are already there. It’s just a matter of giving them the opportunity to do something else, as opposed to figuring out how to survive day to day.”

VertueLab is a nonprofit fighting climate change by providing funding and holistic entrepreneurial support to cleantech startups. Through a decade of work they have a proven model that can help accelerate climate solutions that are key to reversing the climate crisis.

Why 2021 Will Be A Banner Year For Renewable Energy In The U.S.

Oilprice.com

Why 2021 Will Be A Banner Year For Renewable Energy In The U.S.

Editor OilPrice.com November 18, 2020

A Joe Biden administration is bound to usher in a 180-degree pivot on climate change from the outgoing presidency. But with control of the Senate hanging in the balance with the battle set to go down to the wire in Georgia, Biden’s plan to squeeze $2 trillion from the federal purse to pursue his ambitious Climate Plan could end up severely hamstrung.

But with the global shift to renewable energy in full swing, the American political landscape might not matter that much in the long run.

Indeed, Goldman Sachs has predicted that global capital spending on renewable energy will surpass fossil fuel Capex for the first time ever in 2021.

According to the investment banker, renewable power will reach 25% of the total energy supply capex in 2021, beating out hydrocarbons for the first time ever. According to Goldman’s Carbonomics Report, renewables will reach 25% of the total energy supply capex in 2021, beating out upstream oil and gas investments for the first time in history.

The report says that cleantech has the potential to drive $1-2 trillion per annum in green infrastructure investments and could hit $16 trillion by 2030. This could create 15-20 million jobs worldwide (green infrastructure is 1.5-3.0x more capital- and job-intensive than traditional energy).

Source: Goldman Sachs

Falling cost of capital

Goldman Sachs says a big factor that will help clean energy achieve the remarkable feat is a major bifurcation in cost trends, with renewables recording a big fall in the cost of capital vs. rising costs for fossil fuel investments. According to GS, the weighted average cost of capital (WACC), aka the hurdle rate for renewables, currently clocks in at 3-5% compared to 10-20% for oil and gas investments.

According to the International Renewable Energy Agency (IRENA) Renewable energy costs declined rapidly over the past decade, with solar photovoltaics (PV) falling 82% while onshore wind generation costs declined 39%. These trends are expected to continue in the coming years.

Source: IRENA

The situation could not be more different for the fossil fuel sector.

The global oil and gas sector has recorded the biggest Capex cuts in history: Oil and gas companies focused on the North American market have cut capital expenditure by 49% in 2020; Independent Oil Companies (IOCs) by 29% while National Oil Companies have lowered Capex by 24%.

The North American market has been particularly hard hit, with the sector expected to record a staggering $530 billion reduction in capex over the next 5 years. 2020 upstream oil & gas spending is tracking to fall 60% from its 2014 peak.

Source:The Duff & Phelps Capex Cut Tracker

A lot of the ongoing risks in the oil and gas sector are closely related with the growing danger of stranded assets and massive asset writeoffs.

The unprecedented destruction in energy demand has triggered a wave of asset devaluations, with Royal Dutch Shell (NYSE:RDS.A) announcing that it will writedown $22B of its assets while ExxonMobil (NYSEXOM) has warned it might write off $30B.

Those figures could get a lot bigger as the quarters roll on, with nearly a third of their assets worth nearly a trillion dollars doomed to be declared worthless. Indeed, the average oil reserve life has already fallen by 20 years due to stranded assets.

A slew of potential Covid-19 vaccines have improved the oil and gas outlook somewhat by offering hope for a recovery in 2021. However, a lot will still depend on how committed OPEC+ will remain to its production cuts. The coalition held a ministerial committee meeting on Tuesday but failed to reach a formal agreement on quotas even as Saudi Arabia urged members to consider delaying a boost to output by two million barrels per day come January. With the majority of oil producers struggling to balance their budgets amid historically low oil prices, it’s going to become increasingly hard to convince everyone to keep toeing the line.

By Alex Kimani for Oilprice.com

Trump Swiftly Blows Up His 1 Decent Conservation Action

HuffPost

Trump Swiftly Blows Up His 1 Decent Conservation Action

Chris D’Angelo, Environment Reporter November 20, 2020

The Trump administration wasted no time proving what was clear from the get-go: that its support of a major public lands bill was nothing more than pre-election greenwashing for President Donald Trump and two Senate allies.

In August, Trump signed the bipartisan Great American Outdoors Act into law, falsely portraying himself as a conservationist on par with President Theodore Roosevelt. The measure, widely considered the most significant conservation legislation in a generation, allocates $9.5 billion to fix crumbling national park infrastructure and permanently funds the Land and Water Conservation Fund at $900 million per year. The decades-old LWCF uses offshore fossil fuel revenues to establish and protect parks, wildlife refuges, forests and wildlife habitat.

But Trump and his team are longtime foes of the LWCF. The administration tried repeatedly to gut the program’s funding. And days after the 2020 presidential election, which Trump handily lost, Interior Secretary David Bernhardt signed an order that kneecaps LWCF and undermines the new law that Bernhardt previously argued would not have passed without Trump’s “strong and bold action.”

The order, dated Nov. 9, gives state governors and local jurisdictions the power to veto federal land acquisitions made through LWCF. “A written expression of support by both the affected Governor and local county or county government-equivalent (e.g. parish, borough) is required for the acquisition of land, water, or an interest in land or water under the Federal LWCF program,” it reads.

Once the election was done, it was open season on land protection.Aaron Weiss, deputy director, Center for Western Priorities

The move is a parting gift to the anti-federal land movement that has enjoyed extraordinary access to top administration officials but that never convinced the administration to embrace wholesale transfer or sale of public lands. In fact, the requirement in Bernhardt’s order mirrors an amendment that Sen. Mike Lee (R-Utah) introduced when the Great American Outdoors Act was being debated in Congress, as E&E News highlighted.

Lee strongly opposes federal control of public lands in the West. “Our long-term goal must be the transfer of federal lands to the states,” Lee wrote in a 2018 tweet. William Perry Pendley, the highest-ranking official at Interior’s Bureau of Land Management, shares those extreme views, once writing that the “founding Fathers intended all lands owned by the federal government to be sold.”

Democratic lawmakers, environmentalists and outdoor sporting groups have slammed Trump’s Interior chief for trying to circumvent Congress and restrict how LWCF funds are allocated.

“I urge you to immediately rescind this anti-public land order,” Sen. Jon Tester (D-Mont.), a longtime champion of LWCF, wrote in a letter last week to Bernhardt. “This undercuts what a landowner can do with their own private property, and creates unnecessary, additional levels of bureaucracy that will hamstring future land acquisition through the Land and Water Conservation Fund.”

In a release announcing Bernhardt’s order, the Interior Department said the action “honors Interior’s commitment to be a good neighbor by giving states and communities a voice in federal land acquisition.”

President Donald Trump signs the the Great American Outdoors Act at the White House on Aug. 4. The public lands law aims to fix crumbling national park infrastructure and permanently fund The Land and Water Conservation Fund. (Photo: BRENDAN SMIALOWSKI via Getty Images).

For those paying attention, Trump’s about-face on LWCF felt like little more than a political favor for two Republican senators facing tough bids for reelection in states where protecting public lands is a key issue among voters. Along with showering praise upon himself, Trump credited Sens. Cory Gardner (R-Colo.) and Steve Daines (R-Mont.), who both previously voted in favor of slashing LWCF funding and supported Trump’s anti-conservation agenda at nearly every turn.

“This landmark legislation would not have been possible without the incredible leadership and hard work of two outstanding senators, in particular, and two fine people ― Cory Gardner and Steve Daines,” Trump said at a signing ceremony for the Great American Outdoors Act.

On the campaign trail, Daines and Gardner touted their work on the Great American Outdoors Act. Daines ultimately defeated his challenger. Gardner did not.

As soon as the 2020 election was over, Trump’s team took aim at one of its only conservation achievements. First, the departments of Interior and Agriculture missed statutory deadlines for submitting lists of projects to receive LWCF funding. Then came Bernhardt’s order undermining the program altogether.

The Great American Outdoors Act is no doubt a major victory for America’s public lands and for LWCF, which has been plagued by funding shortfalls all of its 50-year history. The administration’s claimed support for it, on the other hand, was “a ruse” and a “bald-faced lie,” Aaron Weiss, deputy director of Colorado-based conservation group Center for Western Priorities, told HuffPost. He expects Bernhardt was always planning to undercut the law, whether or not Trump won a second term.

“Once the election was done, it was open season on land protection,” Weiss said by email, adding that Bernhardt is “going to throw as much sand into the gears as he can on his way out.”

The Interior Department and other federal agencies are rushing to finalize numerous environmental rollbacks before President-elect Joe Biden assumes office. Those include selling oil and gas leases in Alaska’s pristine Arctic National Wildlife Refuge and permanently slashing protections for hundreds of species of migratory birds.

Butter Is Booming, Whole Milk Is Back and Dairy Is Surviving

Bloomberg

Butter Is Booming, Whole Milk Is Back and Dairy Is Surviving

Justin Fox November 15, 2020

(Bloomberg Opinion) — With Americans staying home more than usual because of the pandemic, and doing lots of baking and cooking to pass the time, this has been a banner year for butter.

Land O’Lakes, the Minnesota-based dairy cooperative, expects to sell 275 million to 300 million pounds of the stuff this year — a 20% increase — as rising retail demand more than makes up for lost restaurant business. Nationwide, according to the U.S. Department of Agriculture, butter production is up 6% over the first nine months of the year and is on track to top two billion pounds for the first time since 1943.

This year’s boom is, as is apparent from the chart, part of a longer-term comeback. On a per-capita basis, Americans eat far less butter than they did in the early decades of the 20th century. But they eat more than they did in the 1980’s and 1990’s.

After staving off competition from margarine with nearly a century of lobbying for margarine bans, taxes and color restrictions, butter producers lost their regulatory advantages in the 1940’s and 1950’s and ceded a lot of market share to the cheaper spread — which had originally been derived from beef fat but was by then mainly made out of vegetable oil. As medical researchers began to link consumption of animal fats with heart disease in the 1950’s and 1960’s, margarine gained even more ground as a purportedly healthier alternative.

Those health claims were later mostly debunked, and the price difference between butter and margarine began to matter less as incomes rose and families shrank (food purchased for off-premises consumption accounted for more than 18% of consumer spending in the early 1950’s and just 6% in 2019).

Butter also benefited from the emphasis on genuine ingredients accompanying the good-food revival that began in the 1960’s (Julia Child certainly wasn’t going to use margarine). And let’s be honest, it tastes better. Corn oil, olive oil and other vegetable oils now play a much bigger role in American diets than they used to, so butter will probably never regain its central status of a century ago. But it’s not going away.

“It’s a survivor story,” says Peter Vitaliano, vice president of economic policy and market research at the National Milk Producers Federation.

The same goes for the dairy industry in general. It can seem awfully embattled from time to time, and for good reason. Giant, highly productive dairies have been driving lots of smaller farmers out of business. Competition from “milks” made of almonds, oats, soybeans and other plants has taken market share from the real thing and led to a dairy industry lobbying campaign reminiscent of the margarine wars of yore. President Donald Trump’s trade policies have caused problems too. Two big milk marketers, Borden Dairy Co. and Dean Foods Inc., have filed for bankruptcy in the past 12 months.

But the big picture for the industry since 1980 or so is of declining demand for its core product (milk, that is) being more than offset by rising sales of almost everything that can be made out of milk.

Even within milk sales there’s been an interesting shift lately, with whole milk outselling 2% milk for the first time in 15 years in 2018 and building on its lead in 2019, and skim milk sales drifting downward. If you’re going to drink milk, and not smashed-up almonds mixed with water, then you might as well drink the milkiest kind of milk.

Whole milk happens to be the most profitable product for dairy farmers, as it’s basically just what comes out of the cow and thus doesn’t require them to share much revenue with processors. It also has benefited from the new eat-at-home normal of the pandemic, with sales up 4.1% through August (2% milk sales are up too, with skim and 1% down).

But on the whole, it is products made of milk that have kept the industry going. The butter revival is one aspect of this. The rise of yogurt, which was close to nonexistent in the U.S. before the 1970’s, is another, even though it has faded a bit lately.

The main driver of the dairy industry’s resilience, though, has been cheese. Americans consume almost three times as much of it per-person as they did in 1970.

Not all of this is the result of what you’d call organic consumer demand. Yes, the big gains in Italian cheese consumption seem to reflect the fact that we eat a lot more pizza than we used to. One can also see hints in the data of the rising popularity of Mexican food (which in its north-of-the-border incarnation contains lots of Cheddar and Jack cheese), bagels’ emergence from regional-food status (cream cheese!) and other fun food trends.

But as cheese can be stored for longer than milk or butter or yogurt, it’s also something the dairy industry makes when it has more milk than it knows what to do with, resulting in the infamous “cheese mountain” that is occasionally reduced in size by big government purchases. Those have been especially big this year, with the Agriculture Department so far delivering more than 118 million food boxes — each containing several pounds of dairy products, mainly cheese — to food banks and other charities as part of pandemic-relief efforts.

The industry has also found new things to sell beyond milk, butter, yogurt and cheese, and new places to sell them. Forty years ago the U.S. hardly exported any dairy products. Now it exports a fair amount of cheese, mainly to Mexico, South Korea and Japan, and even bigger quantities of cheese-making byproducts such as whey powder, whey protein isolate and lactose, all of which are used in manufacturing foods and dietary supplements.

The main byproduct of modern butter-making is skim milk powder, most of which is exported to Mexico and Southeast Asia to be reconstituted, often in combination with vegetable oils, into various milk-like drinks. Overall, says Vitaliano, the U.S. exports about 4% of the milk fat it produces and 19% of the skim solids.

To bring things back to butter, the U.S. actually imports more of the stuff than it exports, with Ireland’s Kerrygold the No. 2 butter brand in the U.S. after Land O’Lakes. But the import quantities are still small relative to domestic production. So this year of high butter demand has been good for U.S. dairy cooperatives that specialize in the stuff, such as Land O’Lakes and No. 1 producer California Dairies Inc., which makes Challenge and Danish Creamery butter. (Both Land O’Lakes and California Dairies also produce private-label butter for retailers, so their role in supplying the country with butter goes way beyond their own brands.)

It has also been a good year for California dairies in general, given that the state accounts for just over 30% of U.S. butter production, with Land O’Lakes a big presence there too. Wisconsin, “America’s Dairyland,” focuses more on cheese, with a quarter of U.S. production. New York is tops in yogurt, with about 15% of production.

In terms of milk output for all purposes, California is No. 1 at more than 18% of the national total. It has held the top spot since passing Wisconsin in 1993, but the latter has been narrowing the gap lately. Idaho recently overtook New York for third place, and Texas may be nipping at its heels soon. For an ancient, not exactly fast-growing industry, dairy has a lot more drama than you might expect.

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

Justin Fox is a Bloomberg Opinion columnist covering business. He was the editorial director of Harvard Business Review and wrote for Time, Fortune and American Banker. He is the author of “The Myth of the Rational Market.”