In recent weeks, I’ve written on this blog about the need for renewable energy. But actions speak louder than words. So this week we’ll provide updates on what our company, Advanced Trailer, is doing about it.

As you know, our company has developed the Advanced Trailer for Biomass, which has the ability to dry, store and transport the woodchips that fuel biomass. This week, we’ll have three big announcements about how our company is partnering with major universities to build the future of biomass.

So check in the rest of this week for breaking news on the Advanced Trailer for Biomass!

Today we conclude our series on the myths of wind power by discussing the top three complaints.

First, we are often told that wind turbines are too noisy. Not so according to Appalachian State University:

“Today’s large wind turbines make less noise (about 45 decibels-dB) than the background noise you hear in your own home (50 dB)! According to the American Wind Energy Association (AWEA), today an operating wind farm at a distance of about 750 to 1,000 feet is no noisier than a kitchen refrigerator or a moderately quiet room.”

Second, we sometimes hear that lots of turbines are needed just to generate minimal energy. Again, not so:

“Improved technology has enabled far fewer turbines to produce more electricity. The standard output of a turbine grew from .5 mW in 1995 to 1.5 mW in 2003.”

And last but not least, we always hear that wind turbines are not very pretty. Not true at all:

“In North Carolina, a study to determine public attitudes towards wind energy was recently conducted. The study found that 77.1% of participants who had seen first hand a utility scale turbine said that they liked its appearance. Studies from numerous US states and other countries report that a majority of people think wind turbines are graceful, elegant structures. Many people find turbines to be interesting features in the landscape, enhancing the vista overall. In the UK, the British Wind Energy Association notes that wind farms are popular tourist attractions, with thousands of people each year flocking to visit attractions.”

So the myths against wind power are just that: myths. The reality is wind is a reliable, affordable and effective way to create supplemental energy power in the United States. So what are we waiting for? Part of the answer to our domestic energy challenge can be found blowin’ in the wind!

Today we’re going to take a break in our series on alternative energy.  I want to go back to June 25 when I wrote on this blog:

“we are facing a ‘ticking time bomb.’ Why?  Because some $1.3 trillion in mortgage loans to commercial properties will come due between now and 2013.”

Now, two months later, Investor’s Business Daily is making the same warning:

http://www.ibdeditorials.com/IBDArticles.aspx?id=335660380569943

Many people see the recent uptick in the stock market as proof that the economy is coming back.  But listen to what IBD warns:

“But is this daylight at the end of the tunnel or the beam of an oncoming locomotive of commercial real estate insolvency coming down the tracks on a collision course with a shaky economy?”

I’m afraid it still looks like a train from where I am.

The article notes that: “Commercial real estate (CRE), valued at $3.5 trillion in the U.S., has experienced a 39% decline in prices from the peak only two years ago, according to the MIT Center for Real Estate.”

So hold onto your wallets.  We’re not out of the economic woods just yet.  In fact, things might get worse before they get better.

Another classic myth that you often hear about wind turbines is that they kill birds. Well, maybe a few birds.  But comparatively speaking, not many.

The North Carolina Wind Energy Site at Appalachian State University has thoroughly refuted this claim:

http://www.wind.appstate.edu/windpower/myths.php

The website notes that:

“Although birds do infrequently collide with turbines, wind energy poses less of a threat to birds than many other commonplace structures. In fact, the National Audubon Society has stated that it supports the development and use of wind power. Based on numerous studies that have taken place in Vermont, Colorado, Wyoming, Minnesota, and California, collision with turbines result in 1-2 bird deaths or less per turbine per year. For comparison, each year at least 60 million birds die in collisions with vehicles; at least 98 million in collisions with buildings and windows; and at least 4 million in collisions with communication towers. Important consideration should be given to placement of wind turbines to ensure that turbines are not located along migratory bird flight paths or the flight paths of threatened or rare species.”

So yes, I guess wind turbines do kill birds.  But not nearly as many as buildings, windows and cars.  And no one seems to be opposed to those.

The argument that wind power kills birds gets blown away by the wind.

Another wind myth is that wind power is just a fad and can’t really produce energy.

The reality is, this past year the United States surpassed Germany to become the world leader in wind power:

http://www.bradenton.com/living/living_green/story/1657982.html

Wind is here, wind is working and wind is growing.  According to this article:

“- Wind projects accounted for 42 percent of all new electric generating capacity in the United States last year.

“- Growth is distributed across much of the country. Texas leads the nation with 7,118 megawatts of new wind capacity installed, followed by Iowa (2,791 megawatts) and California (2,517 megawatts). For a long time, California led the United States in installed wind capacity.”

So America is leading the world and Texas leading America when it comes to wind power. And the growth of wind energy is not a fad…it’s a fact.

This week we continue our series on renewable energy and why you shouldn’t believe the myths generated by its critics.

Another key myth is that wind turbines are ugly, ruin the view and make too much noise. Here is an article about a rancher in Wyoming who wants to lease his land for wind turbines. The only problem is his neighbors don’t like the idea much:

http://www.google.com/hostednews/ap/article/ALeqM5hPppDb6c_44-I-7TjoNgGhoSD3TwD9A8RKMG1

If you were to go back in time, you might have heard some of these same arguments when the oil boom was hitting: The derricks are ugly…they ruin the view…they make noise! But before long, people realized that derricks created economic opportunity. At that point, they didn’t look so bad anymore. Soon, the derricks became part of the landscape.

And by the way, we’ve had windmills on farms for years and years and they’ve also become iconic parts of the rural landscape. The wind turbine is the same basic concept. And as for the noise, it’s a low level hum that is quite soothing.

By the way, I know what I’m talking about: I’ve had wind turbines on my ranch.

Another one of the myths about renewable energy is that there is nothing that can be done to store the energy when it’s not needed.

For example, what happens if the wind is blowing the turbines but the demand for energy is down at that particular time? And how do you store solar power when the sun goes down?

This criticism makes the perfect the enemy of the good.  Just because renewable energy can’t be used all the time doesn’t it mean it can’t be use a lot of the time. Besides, there are new concepts being developed that will allow us to store and transmit renewable energy.

Not long ago I met with executives at TXU who talked about a concept to build two bodies of water. On days with strong wind and small energy demand the electricity produced would be used to pump water through a pipeline from the lower lake to the upper lake. On days with peak energy demand the upper lake would open the floodgates on a hydro electric dam and the water would flow into the lower body of water, thus being ready for the next high wind-low demand day to pump.

Another idea that is being discussed is using the electricity to power large compressors that would compress air in old vacated oil and gas wells. The pressure would be held until days with peak demand and the valves would be opened thus releasing air to turn aditional turbins to create more electricity.

So there are ways that are being developed that can take advantage of wind, water and solar even when there is not peak demand.  And in the meantime, let’s not let the perfect be the enemy of the good!

One of the myths about wind power is that it is too expensive.  The reality is, it’s one of the most affordable sources of energy around.

Consider the folks out in Sweetwater, Texas who are hoping to build a new clean coal plant:

http://www.gosanangelo.com/news/2009/apr/21/tenaska-coal-plant-will-need-more-than-carbon/

Talk about costly!  It is estimated that the plant will cost $3.5 billion just to build.

As the article notes:

“The plant will use low-sulfur coal from Wyoming to generate 600 megawatts electricity, losing perhaps 200 megawatts in the process of capturing carbon dioxide.

“Tenaska then plans to sell 85 percent to 90 percent of carbon emissions captured from the plant for use in oil production in West Texas – location of the world’s largest market for carbon.”

In other words, this coal plant ain’t paying for itself. The idea is to use cap-and-trade sales to cover the deficit. Talk about expensive!

In contrast. wind power does pay for itself. The turbines are relatively affordable to build. And then the electric company begins paying fees to the owner of the land. Everybody wins.

So don’t believe the myth that wind power is too expensive.

Today let’s talk about what wind power means for landowners, state taxes and economic development.

Very few of the wind farms are constructed on land owned by the owner of the wind turbines. Wind development companies lease the land from the owners. Many of the locations across Texas with great wind have sparse populations with depressed economies. When oil and cotton were kings many of these small towns prospered. Today many are on the brink of blowing like dust in the wind.

But wind is revitalizing small towns and communities all across Texas. With the wind blows in new jobs, increased tax valuations and new funds for public schools. Landowners lease their properties to wind developers like the oil tycoons did in the 40’s; but this time there are no dry holes. Landowners get an upfront fee for each site (location) that a turbine will go up on their properties, ranging from $1200 to $2000 each.

The landowner will also get a royalty percentage of the energy production. This could range from 2.5% to 6% depending on the company and how good the wind is in your area.

Here is an example from the Callahan Divide Wind Farm located southwest of Abilene. FPL installed GE 1.5 meg wind turbines that produce about $20,000 per month per turbine. This is calculated at a wholesale electricity rate of 4.9 per kwh. Most of us in Texas are paying .10cents to .13cents per kwh retail. If a landowner’s lease was at 2.5% then his monthly royalty payment would be $500 per month per turbine. You can see this isn’t a lot of money, and your not going to hit any gushers and make a million in a month. But remember there are no “dry holes.” The wind is very consistent and easily discovered. And if you were a rancher with a few thousand acres trying to scratch out a living with 50 head of cattle, you can see how 30 or 40 turbins on land that is worth just a few hundred dollars per acre could change lives and the economies where they spend their money.

Thanks to wind power, local tax values increase and so does the tax revenue for schools. Across West Texas schools like Clyde and Trent are building new schools, stadiums and rebuilding their once powerful football programs. But don’t take my word for it. Check out what Clyde just built with it’s money: http://www.reporternews.com/news/2009/aug/15/clyde-builds-on-its-success-in-new-digs/

No doubt about it: wind power is changing the world.

Recently, much has been made in the media about the cost of renewable energy. So I thought I would shed some light on what is going on in this area and what it means for the future of energy in America.

First, it needs to be stated that renewable energy is not cheap. In 2007, wind power cost about $1 million per megawatt. In 2008, that number jumped to $2 million per megawatt. This price includes construction cost, turbin, transmission, infastructure, everything.

So if you were putting up 100 1.5 meg in wind power that would be $300 million.

Since it’s so expensive, the government offers tax credits to encourage renewable energy. It comes in the form of income tax offsets of 2 cents per kwh. This is a substantial amount of money if you consider that the wholesale price of energy on wind turbins was 4.9 cents per kwh. This would be an additional 40% of income.

Here is how it worked:

Prior to the recession many companies were seeing large profits. They could purchase a tax credit for .89 to .90 cents on the dollar and use it to offset income. Many big banks and financial institutions would pre-buy all of your tax credits for the entire 10-year term. Many lenders would finance the project if they were able to buy all the tax credits from a project. This huge amount of upfront money would normally be the equity that would go into a project. So if a developer was doing a $300 million project, he would likely pre-sell the tax credits to a tax credit investor (like a bank) for $89 million and that bank would finance the project and credit the $89 million to equity. So the loan for the $300 million project would only have $211 million in debt against the project. The only problem is that two years ago the tax credits were in high demand. Now with companies not making the profits they did they don’t need to buy tax credits. Companies like Wachovia are now stuck with tax credits they may or may not need. Thus they try to sell them (syndication) to other companies that have profits.

In today’s economy, no one is fighting over the tax credits like they were a year ago. In January at a wind power conference in California we learned that there were over 20 wind farms financed in 2008. But just 3 pre-sold the tax credits prior to generating the power.

So today’s economy presents challenges to renewable energy. But renewable energy is more needed than ever before.

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As we end our week of blogging about Congress, I thought we would again show some perspective on how out of control Washington spending is:

http://finance.yahoo.com/news/Federal-deficit-higher-in-apf-3876319127.html?x=0&.v=5

Here’s a question for you: what other business can you think of that can spend more than it receives? Much more than it receives. If you or I tried to run our businesses this way we’d be bankrupt.

Instead, Congress keeps spending money it doesn’t have.

Here are the key paragraphs from the article:

“The July deficit reflected government spending of $332.2 billion, a record amount for any month and up from outlays of $263.3 billion in July 2008. Of that increase, about $25 billion reflected the fact that Aug. 1 was a Saturday this year, requiring many government benefit checks to be sent out earlier and counted as spending in July.

“Government receipts totaled $151.5 billion, down 5.6 percent from a year ago. It marked the 15th consecutive month that government receipts have been lower than the same month in the prior year, illustrating how deep the recession has cut into tax receipts.”

So government brought in $151.5 billion and spent $332.2 billion. Incredible.

I hope the American people remember this recklessness the next time they go to the polls in November 2010.

This week I’ve been pretty hard on Congress. But even when criticizing Congress, sometimes there are some events that defy description.

Take a look at this video of Congresswoman Sheila Jackson Lee:

http://www.youtube.com/watch?v=-L3FnWNkIzU

Keep in mind that she is holding a town hall meeting on health care. A town hall meeting! That means she is there to hear the people.

Instead, as this video captured, she decided to take a cell phone call…in the middle of the meeting…while a cancer survivor was talking about health care.

Are you kidding me? How is this woman in Congress?

Then again, when you watch this video and realize there are other people just like Sheila Jackson Lee in Congress you realize why our government is such a mess.

I’ve said a lot of harsh things about Congress lately. But one thing I will never say about Congress is that it’s not effective.

It is effective. Just look at what Congress accomplished in the month of July alone: it increased the federal deficit by $181 billion and set a new all-time record with a $1.3 trillion deficit. That’s impressive!

http://thehill.com/leading-the-news/deficit-grew-by-181-billion-in-july-2009-08-09.html

Of course, these are not the kinds of records that Congress should aspire to set. In fact, because of these record numbers our children and grandchildren will have a pretty hefty tab to pick up some day.

When will Congress stop spending dollars and start making sense?

Yesterday, we talked about Congress wanting to buy more jets than the Pentagon needed. Today, let’s talk about how Congress thinks you and I shouldn’t be allowed to speak up against nationalized health care:

http://blogs.abcnews.com/politicalpunch/2009/08/white-house-disputes-pelosi-contention-that-town-hall-protests-are-un-american.html

Evidently, if you show up at a town hall meeting and tell your Congressman that you oppose nationalized health care, you are un-American. At least that’s what Speaker Pelosi says. Incredible. Give the White House credit for distancing itself from Pelosi on this one.

What’s un-American is Congress spending money it doesn’t have on things it doesn’t need and then telling the American people to be quiet.

Remember last fall when the car executives flew in private jets to Washington to ask for money from Congress?

One Congressman was so outraged that he compared it to a homeless man showing up at a soup kitchen in a top hat and tuxedo. Congress was right to criticize the car executives for this extravagance. But hypocrisy is not limited to the car industry.
It turns out that members of Congress like private jets, too:

http://online.wsj.com/article/SB124986067095218079.html

According to the Wall Street Journal:

“The resistance to buying eight Gulfstream and Boeing planes comes as members of both chambers of Congress embark on the busiest month of the year for official overseas travel. The plan to upgrade the fleet of government jets, which was included in a broader defense-funding bill, has also sparked criticism from the Pentagon, which has said it doesn’t need half of the new jets.”

So let me get this straight: Congress criticizes the car executives for flying on jets, then orders more jets for the government to use than the Pentagon even asked for and does so while many of its members are getting ready to fly around the world on overseas travel.

It reminds me of what Will Rogers once said: every time Congress makes a joke it’s a law and every time Congress makes a law it’s a joke.

Want to know why the time has come for alternative energy? Because the time for oil may have already passed:

http://www.orato.com/business-career/the-economic-importance-of-peak-oil

As this article notes, we may have already experienced peak oil:

“In 1995, several scientists applied Hubbert’s method with current data, coming up with a revised peak oil date of between 2004 and 2008. Modelling with alternate data sets has placed peak oil as early as 2000, and no later than 2011. Peak oil will be reached in the next couple of years if it has not already, with drastic consequences for the world economy and society unless there is a major shift to alternative energy sources.”

I’m an optimist. I see the end of the oil era as the beginning of a new era of alternative energy. Besides, for national security reasons, we have to begin using less oil from the Middle East.

And the best part is, we are fast approaching the day when we won’t need oil because of wind, solar and biomass. We have the resources. We have the technology.

But do we have the vision to see a future fueled by renewable energy?

To show how serious it is about creating renewable energy, the federal government is now exploring the possibility of using federal land for solar farms:

http://www.timescall.com/news_story.asp?ID=17388

Secretary of the Interior Ken Salazar visited Colorado recently to talk about the importance of renewable energy. As the article notes:

“Reducing America’s dependence on foreign oil, creating jobs in this country and protecting the environment are three of the top goals of the Obama administration, Salazar told a small crowd gathered at the company Tuesday afternoon….”

Salazar said that he is looking at using 1000 acres of public land at 24 sites to develop solar farms. Meanwhile, when Congress returns from the August recess it is expected to take up legislation to create more renewable energy.

Whether its solar or wind or biomass, the future of energy will be powered by alternative, renewable sources.

How serious is Washington about alternative energy? Serious enough that political leaders are talking about changing the way we fuel our cars.

This week, Vice President Biden will arrive in Detroit to announce the recipients of federal research grants given to those trying to invent a new battery:

http://www.chicagotribune.com/news/chi-ap-mi-biden-detroit,0,78325.story

For years, we’ve known how to fuel cars with a battery that is charged electrically–we use this technology on golf carts, for example. But the challenge has been to create a battery that is strong enough and can work long enough to power cars. With these grants, we may be getting closer to the day when a stop at the gas station is a memory.

Alternative energy is here. Are you ready for it?

Last week, the United States government did something very smart: it decided to bet on the future.

The Energy Department and the Treasury Department announced they would begin accepting applications for some $3 billion set aside to fund renewable-energy projects:

http://www.nasdaq.com/aspx/stock-market-news-story.aspx?storyid=200907311245dowjonesdjonline000770&title=us-government-accepting-applications-for-renewable-energy-funds

As the article notes:

“The departments estimate that they will distribute at least $3 billion in financial aid to about 5,000 bio-mass, solar, wind and other types of renewable- energy production facilities.”

Before now, the government has offered tax credits and loan guarantees for renewable energy projects. Now, it’s offering cash. And why not? Renewable energy is the future. And that future is already beginning.