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Coal and Houston

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  • mark r. johnson
    ... coal ... Let me try to shed a little light on the few areas where I have some good knowledge. The Houston region has exactly ONE coal burning plant, the
    Message 1 of 25 , Jul 3 5:46 AM
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      --- In hreg@yahoogroups.com, "Michael Christie" <mchristi@f...> wrote:
      > ...
      > Someone in the railroad industry once told me that 100 rail cars of
      coal
      > came into Houston every day.

      Let me try to shed a little light on the few areas where I have some
      good knowledge. The Houston region has exactly ONE coal burning plant,
      the W.A. Parish unit located I think in Wharton. It is fed by low
      sulfur Wyoming coal transported by rail. Literally speaking, there is
      absolutely no need for coal rail cars to pass into or through Houston,
      they will go to Fort Bend County instead.

      It is a sizable portion of the old HL&P's generating capacity, larger
      in fact than the nuclear portion. But it was designed and built in the
      old regulated era where they sought coal and nuclear fuel to reduce
      dependence on natural gas. For a time there were laws on the books
      prohibiting the building of power plants which used natural gas, that
      is the main reason we are saddled with not-so-well conceived coal and
      nuclear plants. HL&P for many years was 100% natural gas fueled, left
      to their own devices they might not have ever wanted to diversify into
      nuclear and coal.

      One weak point of the Parish coal plant concept, was a limited number
      of rail lines coming into the plant. After some railroad mergers,
      there was *one* remaining company serving Parish, and as you might
      guess they had a rather harsh idea of shipping rates. After a couple
      years of this, HL&P built another short rail line so they could have
      at least a competitive market shipping them their needed fuel.

      Utilities in Central Texas and North Texas make relatively extensive
      use of lignite, an indigenous type of coal which is cheap, not low
      sulfur, low in energy content per pound, and therefore not worth
      transporting. The only really good way to burn lignite is to build a
      power plant very close to the lignite mining, ideally at the mouth of
      the mine. Economics of lignite depend on the quantity and quality of
      fuel available -- electricity from such can be relatively very cheap
      if you have a good lignite source (and don't invest too heavily in
      anti-pollution equipment).

      The old HL&P also built one lignite plant in Central Texas near Waco.
      What I have heard is their fuel source is mediocre, a thin vein which
      is not expected to last but about 25-30 years. This plant's economics
      would be much improved except for the lousy fuel source. It is my
      understanding that many other lignite plants in Texas are more
      economical.

      With a slow trend toward competition in the energy industry, we should
      watch to see whether the coal or the lignite plant might be shut down
      for cost reasons.

      I used to work for HL&P and so learned of many of these things through
      office communication and publications which are not widely
      distributed. FWIW my opinion is that coal is inherently a loathsome
      fuel to burn vs. natural gas, because of coal's pollution aspects.
      Natural gas is inherently a pretty clean fuel as the great majority of
      the non-fuel parts are removed at the wellhead. To me the trade-off
      between burning coal which is nearly always cheap but dirty, vs.
      natural gas, is a devilish temptation. One might realistically say the
      worst natural gas plant is cleaner than the best coal plant.

      I am interested in all forms of energy including renewables, but I
      will always be able to
      articulate the virtues of certain non-renewable fuels.

      Hope this helps -- Mark Johnson
    • mark r. johnson
      ... operations ... the ... dealing and ... I have generally heard of Oscar Wyatt being a crooked businessman, and I am willing to believe the worst about him.
      Message 2 of 25 , Jul 3 6:04 AM
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        --- In hreg@yahoogroups.com, chasmauch@a... wrote:
        > ...I think San Antonio and several other south Texas
        > towns use a lot of coal. This is a carryover effect of Oscar Wyatt's
        operations
        > years ago, an early day Enron type scam that should have resulted in
        the
        > bankruptcy of Coastal States, but due to his effective wheeling and
        dealing and
        > his sharp lawyers, he was able to wiggle out of it.

        I have generally heard of Oscar Wyatt being a crooked businessman, and
        I am willing to believe the worst about him. But I have not heard this
        story and would certainly like to see a reference to educate me about it.

        One thing I would request, is to not lump all scams in the same
        category -- I think it is important to *understand* scams so honest
        people can better protect themselves. My understanding is Enron was a
        particular type of criminal business behavior; I would not want to say
        another criminal businessman is "like Enron" unless it is absolutely true.

        > Older folks will remember
        > the details but anyway SA and some other south Texas towns switched
        over from
        > gas to coal and have been using it ever since.

        I guess by now I am one of the older folks, and this is specialized
        knowledge that we *don't* all remember. Actually, I want to express
        real skepticism that Wyatt was that influential in the building of
        lignite/coal plants in Texas. One cannot "convert" a natural gas plant
        to coal, as coal requires some elaborate and expensive machinery to
        handle it. I try to stay aware of electric generating technology and
        have never heard of a gas plant being converted to coal. If I am wrong
        then please have mercy and point me to some education.

        Lignite is a traditional fuel and in ample cheap supply in certain
        areas of Texas. Furthermore, the utilities in question cannot simply
        make a fuel choice arbitrarily, many are municipals (e.g. Austin and
        San Antonio) and so the city government is the body to give approval
        for any spending plan. Others such as Dallas' TXU must go to the PUC
        for approval of new plants -- granted TXU knows how to manipulate the
        PUC fairly well but it's not the style of Oscar Wyatt to have the
        patience to participate in PUC dockets (not unless somebody else does
        the huge amounts of routine work). It's easy to *imagine* a person
        like Oscar Wyatt setting energy policy for Texas, but believe me the
        real process is slow, painstaking, and includes many checks and
        balances which inhibit one person from having much influence.

        Please forgive the rather contentious tone of my post, I don't mean to
        denigrate you but am more interested in getting to the facts in as
        simple and direct a manner as possible.

        Best wishes -- Mark Johnson
      • Michael Christie
        Mark, I vote to give you the title of HREG Coal Guru . You certainly brought a lot of interesting and relevant information to the group. And, you answered my
        Message 3 of 25 , Jul 3 8:45 AM
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          Mark,

          I vote to give you the title of "HREG Coal Guru". You certainly brought a
          lot of interesting and relevant information to the group. And, you answered
          my question. It may very well have been this plant that my source of
          information was referring to. Many people, myself included, are rather loose
          in our definition of "Houston". And as you can see, we are not all well
          informed.

          Thank you
          Michael Christie

          -----Original Message-----
          From: mark r. johnson [mailto:mrj53@...]
          Sent: Thursday, July 03, 2003 7:47 AM
          To: hreg@yahoogroups.com
          Subject: [hreg] Coal and Houston


          --- In hreg@yahoogroups.com, "Michael Christie" <mchristi@f...> wrote:
          > ...
          > Someone in the railroad industry once told me that 100 rail cars of
          coal
          > came into Houston every day.

          Let me try to shed a little light on the few areas where I have some
          good knowledge. The Houston region has exactly ONE coal burning plant,
          the W.A. Parish unit located I think in Wharton. It is fed by low
          sulfur Wyoming coal transported by rail. Literally speaking, there is
          absolutely no need for coal rail cars to pass into or through Houston,
          they will go to Fort Bend County instead.

          It is a sizable portion of the old HL&P's generating capacity, larger
          in fact than the nuclear portion. But it was designed and built in the
          old regulated era where they sought coal and nuclear fuel to reduce
          dependence on natural gas. For a time there were laws on the books
          prohibiting the building of power plants which used natural gas, that
          is the main reason we are saddled with not-so-well conceived coal and
          nuclear plants. HL&P for many years was 100% natural gas fueled, left
          to their own devices they might not have ever wanted to diversify into
          nuclear and coal.

          One weak point of the Parish coal plant concept, was a limited number
          of rail lines coming into the plant. After some railroad mergers,
          there was *one* remaining company serving Parish, and as you might
          guess they had a rather harsh idea of shipping rates. After a couple
          years of this, HL&P built another short rail line so they could have
          at least a competitive market shipping them their needed fuel.

          Utilities in Central Texas and North Texas make relatively extensive
          use of lignite, an indigenous type of coal which is cheap, not low
          sulfur, low in energy content per pound, and therefore not worth
          transporting. The only really good way to burn lignite is to build a
          power plant very close to the lignite mining, ideally at the mouth of
          the mine. Economics of lignite depend on the quantity and quality of
          fuel available -- electricity from such can be relatively very cheap
          if you have a good lignite source (and don't invest too heavily in
          anti-pollution equipment).

          The old HL&P also built one lignite plant in Central Texas near Waco.
          What I have heard is their fuel source is mediocre, a thin vein which
          is not expected to last but about 25-30 years. This plant's economics
          would be much improved except for the lousy fuel source. It is my
          understanding that many other lignite plants in Texas are more
          economical.

          With a slow trend toward competition in the energy industry, we should
          watch to see whether the coal or the lignite plant might be shut down
          for cost reasons.

          I used to work for HL&P and so learned of many of these things through
          office communication and publications which are not widely
          distributed. FWIW my opinion is that coal is inherently a loathsome
          fuel to burn vs. natural gas, because of coal's pollution aspects.
          Natural gas is inherently a pretty clean fuel as the great majority of
          the non-fuel parts are removed at the wellhead. To me the trade-off
          between burning coal which is nearly always cheap but dirty, vs.
          natural gas, is a devilish temptation. One might realistically say the
          worst natural gas plant is cleaner than the best coal plant.

          I am interested in all forms of energy including renewables, but I
          will always be able to
          articulate the virtues of certain non-renewable fuels.

          Hope this helps -- Mark Johnson





          Your use of Yahoo! Groups is subject to http://docs.yahoo.com/info/terms/
        • Leonard Bachman
          Michael, I once heard a knowledgable estimate that it would take a coal train one mile long arriving every hour in Houston to furnish all our regional
          Message 4 of 25 , Jul 3 9:05 AM
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            Michael,
            I once heard a knowledgable estimate that it would take a coal train one
            mile long arriving every hour in Houston to furnish all our regional
            electricity generation. That was in the day when we were trying to save all
            the natural gas for direct residential use, assuming that industry could buy
            and process other forms of energy.
            Leonard Bachman

            ----- Original Message -----
            From: "Michael Christie" <mchristi@...>
            To: <hreg@yahoogroups.com>
            Sent: Thursday, July 03, 2003 10:45 AM
            Subject: RE: [hreg] Coal and Houston


            > Mark,
            >
            > I vote to give you the title of "HREG Coal Guru". You certainly brought a
            > lot of interesting and relevant information to the group. And, you
            answered
            > my question. It may very well have been this plant that my source of
            > information was referring to. Many people, myself included, are rather
            loose
            > in our definition of "Houston". And as you can see, we are not all well
            > informed.
            >
            > Thank you
            > Michael Christie
            >
            > -----Original Message-----
            > From: mark r. johnson [mailto:mrj53@...]
            > Sent: Thursday, July 03, 2003 7:47 AM
            > To: hreg@yahoogroups.com
            > Subject: [hreg] Coal and Houston
            >
            >
            > --- In hreg@yahoogroups.com, "Michael Christie" <mchristi@f...> wrote:
            > > ...
            > > Someone in the railroad industry once told me that 100 rail cars of
            > coal
            > > came into Houston every day.
            >
            > Let me try to shed a little light on the few areas where I have some
            > good knowledge. The Houston region has exactly ONE coal burning plant,
            > the W.A. Parish unit located I think in Wharton. It is fed by low
            > sulfur Wyoming coal transported by rail. Literally speaking, there is
            > absolutely no need for coal rail cars to pass into or through Houston,
            > they will go to Fort Bend County instead.
            >
            > It is a sizable portion of the old HL&P's generating capacity, larger
            > in fact than the nuclear portion. But it was designed and built in the
            > old regulated era where they sought coal and nuclear fuel to reduce
            > dependence on natural gas. For a time there were laws on the books
            > prohibiting the building of power plants which used natural gas, that
            > is the main reason we are saddled with not-so-well conceived coal and
            > nuclear plants. HL&P for many years was 100% natural gas fueled, left
            > to their own devices they might not have ever wanted to diversify into
            > nuclear and coal.
            >
            > One weak point of the Parish coal plant concept, was a limited number
            > of rail lines coming into the plant. After some railroad mergers,
            > there was *one* remaining company serving Parish, and as you might
            > guess they had a rather harsh idea of shipping rates. After a couple
            > years of this, HL&P built another short rail line so they could have
            > at least a competitive market shipping them their needed fuel.
            >
            > Utilities in Central Texas and North Texas make relatively extensive
            > use of lignite, an indigenous type of coal which is cheap, not low
            > sulfur, low in energy content per pound, and therefore not worth
            > transporting. The only really good way to burn lignite is to build a
            > power plant very close to the lignite mining, ideally at the mouth of
            > the mine. Economics of lignite depend on the quantity and quality of
            > fuel available -- electricity from such can be relatively very cheap
            > if you have a good lignite source (and don't invest too heavily in
            > anti-pollution equipment).
            >
            > The old HL&P also built one lignite plant in Central Texas near Waco.
            > What I have heard is their fuel source is mediocre, a thin vein which
            > is not expected to last but about 25-30 years. This plant's economics
            > would be much improved except for the lousy fuel source. It is my
            > understanding that many other lignite plants in Texas are more
            > economical.
            >
            > With a slow trend toward competition in the energy industry, we should
            > watch to see whether the coal or the lignite plant might be shut down
            > for cost reasons.
            >
            > I used to work for HL&P and so learned of many of these things through
            > office communication and publications which are not widely
            > distributed. FWIW my opinion is that coal is inherently a loathsome
            > fuel to burn vs. natural gas, because of coal's pollution aspects.
            > Natural gas is inherently a pretty clean fuel as the great majority of
            > the non-fuel parts are removed at the wellhead. To me the trade-off
            > between burning coal which is nearly always cheap but dirty, vs.
            > natural gas, is a devilish temptation. One might realistically say the
            > worst natural gas plant is cleaner than the best coal plant.
            >
            > I am interested in all forms of energy including renewables, but I
            > will always be able to
            > articulate the virtues of certain non-renewable fuels.
            >
            > Hope this helps -- Mark Johnson
            >
            >
            >
            >
            >
            > Your use of Yahoo! Groups is subject to http://docs.yahoo.com/info/terms/
            >
            >
            >
            >
            >
            >
            >
            >
            > Your use of Yahoo! Groups is subject to http://docs.yahoo.com/info/terms/
            >
            >
            >
          • chasmauch@aol.com
            In a message dated 7/3/03 8:09:34 AM Central Daylight Time, ... This happened a long time ago - in the 1960s as I recall. It was a continuing story in most
            Message 5 of 25 , Jul 3 12:54 PM
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              In a message dated 7/3/03 8:09:34 AM Central Daylight Time, mrj53@... writes:

              I have generally heard of Oscar Wyatt being a crooked businessman, and
              I am willing to believe the worst about him. But I have not heard this
              story and would certainly like to see a reference to educate me about it.



              This happened a long time ago - in the 1960s as I recall. It was a continuing story in most newspapers in south Texas for several years about the problems between SA, Corpus Christi, and other south Texas towns vs Coastal. Texas Monthly did a detailed, feature-length article that gave the best blow-by-blow description I know of. Don't know if their archives go back that far but you might find it in a library. Don't remember the exact date.

              One thing I would request, is to not lump all scams in the same
              category -- I think it is important to *understand* scams so honest
              people can better protect themselves. My understanding is Enron was a
              particular type of criminal business behavior; I would not want to say
              another criminal businessman is "like Enron" unless it is absolutely true.



              There can be a fine line between sharp business practices and outright deliberate criminal behaviour. Wyatt always had a reputation of walking that line and kept a bevy of sharp lawyers on the payroll to make sure he remained about an hour ahead of the posse. I will try to explain very generally below what he did, and you can decide if it was a scam or sharp business.

              I guess by now I am one of the older folks, and this is specialized
              knowledge that we *don't* all remember. Actually, I want to express
              real skepticism that Wyatt was that influential in the building of
              lignite/coal plants in Texas. One cannot "convert" a natural gas plant
              to coal, as coal requires some elaborate and expensive machinery to
              handle it. I try to stay aware of electric generating technology and
              have never heard of a gas plant being converted to coal. If I am wrong
              then please have mercy and point me to some education.



              Wyatt was a legendary figure around Corpus where he started out, and I was working as an independent petroleum engineer in Corpus at the time. Everyone claimed to know him but of course most did not. He was able to sell gas quick at the best price available so lots of folks wanted to do business with him, but it was a kind of scary thing because he also had the reputation of screwing his partners and just about everyone else around. I never had any direct dealing with him but knew a lot of folks who did, and as one used to say, you had to be very careful - he said it was OK to dance with a bear but be sure to keep an eye on your partner.

              Most people who read the papers were following the whole scam (business transaction?) closely, and those in the "oil bizness" were following it even closer, so guess we just assumed that everyone else was too. And no, you can't just convert from gas to coal - that was bad wording on my part. But the city did start to change over - I assume by building new plants - and eventually did pretty much make the conversion.

              Lignite is a traditional fuel and in ample cheap supply in certain
              areas of Texas. Furthermore, the utilities in question cannot simply
              make a fuel choice arbitrarily, many are municipals (e.g. Austin and
              San Antonio) and so the city government is the body to give approval
              for any spending plan. Others such as Dallas' TXU must go to the PUC
              for approval of new plants -- granted TXU knows how to manipulate the
              PUC fairly well but it's not the style of Oscar Wyatt to have the
              patience to participate in PUC dockets (not unless somebody else does
              the huge amounts of routine work). It's easy to *imagine* a person
              like Oscar Wyatt setting energy policy for Texas, but believe me the
              real process is slow, painstaking, and includes many checks and
              balances which inhibit one person from having much influence.



              After I failed to become a rich independent oilman, I got married and had to find honest employment so went to work for a major company (Sun Oil) for the next 30 years as a natural gas engineer and eventually in the natural gas marketing department as a gas sales rep. The marketing situation was wild in those days since interstate sales were regulated by the Federal Energy Regulatory Commission (FERC) and intrastate sales were not. The price of the regulated gas was held ridiculously low while the unregulated intrastate market was much higher (not to mention all the heavy-handed regs pertaining to interstate sales) so naturally everyone avoided the interstate market if they possibly could.

              At one time there were as I recall about 15 different prices for gas, depending on a varitey of strange factors. The Natural Gas Act outlined the marketing rules very generally and relied on the FERC and the courts to interpret what the various provisions of the law meant. Often various portions of the regs were tied up in court on apeal for years during which time no one was sure what the rules were, so clearly it was a lawyer's dream and a nightmare for everyone else. In this situation, clever lawyers find all kinds of loopholes, and Coastal was one of the best in this regard.

              What they did was sign a long-term contract to supply gas to SA, Corpus, and the other cities at a fixed price of about 25 cents per thousand cubic feet. They convinced the various city councils that they had vast reserves to back up this commitment but in fact these reverves were tremendously overstated and they did not have anywhere near what they claimed to have. Then very soon the price of gas shot up above a dollar, leaving Coastal in a very bad positon. They did not have their own gas reserves under contract so would have to buy it on the open market for over a dollar and sell it for 25 cents - a situation guaranteed to result in bankruptcy in short order for anyone. Everyone thought Wyatt's goose was finally cooked but incredibly he managed to escape from the contracts. I am not sure how he pulled it off but it was a feat that would have done Houdini proud.

              Sorry to be so longwinded so will stop. Oceans of ink have been used writing about these transactions and a number of questions remain unanswered to this day. That's about all I know about it. If it was not a scam it was pretty close, and IMO the public got ripped off big time. I do not "imagine" that Wyatt "set the energy policy for Texas" but there in no question that he was pretty directly responsible for a lot coal coming in from out of state to replace natural gas. I guess it's all ancient history now. Oscar is a respectable billionaire businessman and we are still trying to figure out how to meet our energy needs when the oil and gas supply drops below demand, which won't be much longer. Gonna be some big changes made.

              Charlie

            • Michael Christie
              The comments about Oscar Wyatt and San Antonio caught my interest (I didn t live in Texas in those days, so it was all news to me) so I did some surfing on the
              Message 6 of 25 , Jul 3 2:38 PM
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                The comments about Oscar Wyatt and San Antonio caught my interest (I didn't
                live in Texas in those days, so it was all news to me) so I did some surfing
                on the web. There is a lot of stuff on Oscar, so if you want to find out
                information on him, just go surfing. Here's a little tidbit:
                http://www.la.utexas.edu/course-materials/government/chenry/mena/roles/oil/s
                p1994/0020.html

                All in all, he sounds like a rather despicable man. I may be wrong. Anyhow,
                while surfing, I happened on another site that may be of interest to
                everyone. It comes from our dear friends the French, and has more energy
                news than most people want to know about. Check the menu along the side: it
                has a link to world renewable energy news (complements of "The World News
                Network":
                http://www.frenchdictionary.com/s/oilprices/

                Michael Christie

                -----Original Message-----
                From: mark r. johnson [mailto:mrj53@...]
                Sent: Thursday, July 03, 2003 8:05 AM
                To: hreg@yahoogroups.com
                Subject: [hreg] Coal, Wyatt and Texas power


                --- In hreg@yahoogroups.com, chasmauch@a... wrote:
                > ...I think San Antonio and several other south Texas
                > towns use a lot of coal. This is a carryover effect of Oscar Wyatt's
                operations
                > years ago, an early day Enron type scam that should have resulted in
                the
                > bankruptcy of Coastal States, but due to his effective wheeling and
                dealing and
                > his sharp lawyers, he was able to wiggle out of it.

                I have generally heard of Oscar Wyatt being a crooked businessman, and
                I am willing to believe the worst about him. But I have not heard this
                story and would certainly like to see a reference to educate me about it.

                One thing I would request, is to not lump all scams in the same
                category -- I think it is important to *understand* scams so honest
                people can better protect themselves. My understanding is Enron was a
                particular type of criminal business behavior; I would not want to say
                another criminal businessman is "like Enron" unless it is absolutely true.

                > Older folks will remember
                > the details but anyway SA and some other south Texas towns switched
                over from
                > gas to coal and have been using it ever since.

                I guess by now I am one of the older folks, and this is specialized
                knowledge that we *don't* all remember. Actually, I want to express
                real skepticism that Wyatt was that influential in the building of
                lignite/coal plants in Texas. One cannot "convert" a natural gas plant
                to coal, as coal requires some elaborate and expensive machinery to
                handle it. I try to stay aware of electric generating technology and
                have never heard of a gas plant being converted to coal. If I am wrong
                then please have mercy and point me to some education.

                Lignite is a traditional fuel and in ample cheap supply in certain
                areas of Texas. Furthermore, the utilities in question cannot simply
                make a fuel choice arbitrarily, many are municipals (e.g. Austin and
                San Antonio) and so the city government is the body to give approval
                for any spending plan. Others such as Dallas' TXU must go to the PUC
                for approval of new plants -- granted TXU knows how to manipulate the
                PUC fairly well but it's not the style of Oscar Wyatt to have the
                patience to participate in PUC dockets (not unless somebody else does
                the huge amounts of routine work). It's easy to *imagine* a person
                like Oscar Wyatt setting energy policy for Texas, but believe me the
                real process is slow, painstaking, and includes many checks and
                balances which inhibit one person from having much influence.

                Please forgive the rather contentious tone of my post, I don't mean to
                denigrate you but am more interested in getting to the facts in as
                simple and direct a manner as possible.

                Best wishes -- Mark Johnson





                Your use of Yahoo! Groups is subject to http://docs.yahoo.com/info/terms/
              • mark r. johnson
                ... That s ironic, on a board devoted to clean and renewable energy, very much wanting to look toward the future, I earn the guru title for the most
                Message 7 of 25 , Jul 5 6:32 PM
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                  --- In hreg@yahoogroups.com, "Michael Christie" <mchristi@f...> wrote:
                  > Mark,
                  >
                  > I vote to give you the title of "HREG Coal Guru".

                  That's ironic, on a board devoted to clean and renewable energy, very
                  much wanting to look toward the future, I earn the guru title for the
                  most traditional, dirtiest fuel in widespread use! But I am flattered
                  anyway. In several ways it fits me. Like I have said, I am interested
                  in all forms of energy, including the dirty ones because "we" the
                  world have an obligation to find a way to clean things up.

                  Being centered in South Texas, it is one of the few areas in the USA
                  where it is easy to imagine *not* burning coal for energy. Wonder if I
                  would feel better about coal burning if I lived in say, Ohio <g>.
                  Probably not.

                  Thank you -- Mark J.
                • mark r. johnson
                  ... continuing ... problems ... Texas ... blow-by-blow ... but you ... Thanks Charlie for summarizing it for me. I am sincerely interested in studying what
                  Message 8 of 25 , Jul 5 7:26 PM
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                    --- In hreg@yahoogroups.com, chasmauch@a... wrote:

                    > This happened a long time ago - in the 1960s as I recall. It was a
                    continuing
                    > story in most newspapers in south Texas for several years about the
                    problems
                    > between SA, Corpus Christi, and other south Texas towns vs Coastal.
                    Texas
                    > Monthly did a detailed, feature-length article that gave the best
                    blow-by-blow
                    > description I know of. Don't know if their archives go back that far
                    but you
                    > might find it in a library.

                    Thanks Charlie for summarizing it for me. I am sincerely interested in
                    studying what Wyatt did wrong -- already I have learned that the Fort
                    Bend County library has no books written about Oscar Wyatt or Coastal.
                    Texas Monthly sounds like just the iconoclastic source to learn from,
                    since nobody has written a book (have they?).

                    Your summary sounds like it centers around natural gas (NG)
                    shenanigans, and that coal and lignite use plays a role mainly as a
                    way to avoid NG purchases. That is less far-out than my original
                    impression, in fact easy to believe for a couple of reasons.

                    Could the whole episode have been situated in the 1970's? Because the
                    whole issue of NG not being in good supply, arose along with the
                    energy crisis sparked by the 1973 Arab oil embargo (according to what
                    I think I know). Along with the economic mis-allocation caused by
                    Nixon's price controls, the world truly failed to understand the basic
                    truth of energy supply and demand.

                    Oil spiked in price and then fell to low levels. There were great
                    worries about NG supply, and they created that multi-tiered system of
                    price controls, "old" gas and "new" gas. In fact the world found it
                    easy to believe we were running out of all sorts of resources, and
                    lots of us believed the world was at a turning point. At the time I
                    tended to believe it too, from 2003 I see a lot of the 1970's
                    attitudes as the height of folly.

                    One semi-unintended consequence of the NG rules was to spur
                    construction of a number of new nuclear plants to provide replacement
                    energy, including our own local STNP nuke. What you probably don't
                    know is there were about SIX MORE nuke plants on HL&P's drawing
                    boards, and I figure we got off lucky they weren't built. It was
                    around the same era the root decisions were made to build the Parish
                    coal plant and the Central Texas lignite plant which I accuse of being
                    mediocre projects (keep in mind I could be wrong there). From that era
                    we have Jimmy Carter's energy policies which have not worked out well
                    in practice at all, including some expensive synfuel research and
                    production projects.

                    About nuclear projects: many were conceived and built in the 1960's
                    and those had their problems with safety and reliability but their
                    cost was reasonably low. During the 1970's construction costs zoomed
                    for all sorts of construction projects including nuclear plants, so
                    cost over-runs became legendarily huge. Our STNP was born in a year
                    when damn near all the "good" nuclear engineers were already assigned
                    to existing projects, so HL&P had the devil's choice between going
                    with a second-string team of engineers from an experienced company, or
                    with Brown and Root which had never done such a project before. They
                    went with Brown and Root which in hindsight was a decision which cost
                    them dearly.

                    One thing to know about those years is the Houston area was growing
                    very rapidly and there was genuinely a problem of having enough future
                    generating capacity. They had to build something or else have their
                    service territory reduced by the regulators (don't know if the PUC
                    existed yet, but prior to the PUC there was a similar regulatory
                    function centered around the cities). The choices were basically Texas
                    lignite, non-Texas coal, and nuclear energy -- each would be one plant
                    built, and each the first on a nontrivial learning curve for HL&P.

                    The company's argument is like this: they had no choice but to design
                    enough non-NG plants to replace 100% of their generating capacity, so
                    the actual decision to go nuclear was sound. But they had no choice
                    better than to use Brown and Root -- a decision which has been
                    defended successfully in a number of legal challenges. I don't
                    actually say HL&P made the wrong decision there, but suggest they
                    might have needed a way to kill the project rather than persist until
                    it cost about 10X its original cost estimate. To be balanced you
                    cannot single out HL&P for poor decisions, since other companies
                    building plants at the same time had similar cost overruns.

                    Those awkward decisions of the 1970's came to a head during the
                    1980's, when plants nationwide came to be finished at great cost, and
                    utilities went to their regulators for enough income to pay the
                    mortgages. In some cases the plants were *not* finished, ever, and
                    still the companies needed to ask for rate hikes because they still
                    had that mortgage on a huge project. They needed the cash flow badly,
                    and a number of utilities had to endure cutbacks and dividend cuts
                    after an unsympathetic public did the Monday Morning Quarterback
                    analysis of the decisions of the 1970's.

                    So to recap, what really happened after the panicky decisions of the
                    Carter years? Rather than becoming nearly extinct as planned, NG only
                    became cheaper and more plentiful -- throughout the construction of
                    STNP, HL&P relied on forecasts of much higher NG prices just around
                    the corner. While utilities could not legally build NG plants,
                    non-utility generators had a huge legal advantage because they could
                    burn it and force the utility to buy much of their electricity at
                    prices representing HL&P's "next" plant on the drawing board (which
                    NEVER WAS BUILT). So much non-utility supply became available, all of
                    it burning cheap NG, that HL&P really didn't need STNP for electricity
                    supply. But it was started, it was huge, and if they didn't finish it
                    then HL&P would never get paid back its investment.

                    All SORTS of important things happened which were completely contrary
                    to forecasts made during the 1970's.

                    Generally the Midwest utilities which wound up burning coal, ended up
                    financially in great shape because they simply didn't get on the
                    nuclear bandwagon. Those with non-growing population in their service
                    territories, also ended up pretty well off because they were not
                    forced to make hard choices where every choice was in hindsight, not
                    the right one. But utilities building nuclear plants, had to endure
                    many changes from the original design after Three Mile Island -- the
                    regulators were paralyzed with uncertainty and indecision, and no
                    amount of change orders seemed too much to ask. HL&P claimed that
                    about 75% of STNP's cost overruns were to comply with mandated design
                    changes while the plant was still under construction.

                    Oh well, I seem to be going for a second crown as guru of nuclear
                    energy on this board <g>. I really do enjoy reading accounts of the
                    Oscar Wyatt follies, and hope you enjoy these too.

                    Regards -- Mark J.

                    P.S. Regarding conservation, I see the best way to effectively
                    motivate that is to have the energy price go up, something which is
                    clearly happening this year. If gas and oil worldwide are getting hard
                    to find, then this will be more of a step change than a roller-coaster
                    cycle. Higher prices will tip a number of renewable energy projects
                    into feasibility. I don't see renewables growing into the majority,
                    but we can share some pleasure at seeing them grow a lot from the
                    present level.

                    P.P.S. I am cheering at the technology of LNG imports. That is what we
                    already know how to use, just price has been a limiting factor until
                    the recent price rise. If NG prices stay where they are now, then LNG
                    can emerge as an important source of supply -- from what I have read
                    maybe 10-15% of the nation's NG needs, not 50-75%. At least NG in any
                    form is cleaner than the majority of other fuels.
                  • jclem412@aol.com
                    For more information, I m sure there are many books and resources. Good idea. I can recommend the video tape, GIANT with James Dean - a wonderful synopsis of
                    Message 9 of 25 , Jul 6 3:38 PM
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                      For more information, I'm sure there are many books and resources. Good
                      idea. I can recommend the video tape, GIANT with James Dean - a wonderful
                      synopsis of TX oil. It is excellent. Also, read Blood & Money for more history of
                      the Wyatt's. James Michener's TEXAS is also good. I'm sure many of these seem
                      outdated for some of y'all but this is a start for you. Follow-up w/ the TX.
                      Railroad Commission.

                      I could use more suggestions too. ~ Diane Clemens
                    • David Funk
                      ... switched ... plant ... wrong ... no problem! mercy is granted! It s called pulverized coal firing and can be adapted to natural gas boilers with
                      Message 10 of 25 , Jul 7 2:57 PM
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                        --- In hreg@yahoogroups.com, "mark r. johnson" <mrj53@m...> wrote:
                        > > Older folks will remember
                        > > the details but anyway SA and some other south Texas towns
                        switched
                        > over from
                        > > gas to coal and have been using it ever since.
                        >
                        > I guess by now I am one of the older folks, and this is specialized
                        > knowledge that we *don't* all remember. Actually, I want to express
                        > real skepticism that Wyatt was that influential in the building of
                        > lignite/coal plants in Texas. One cannot "convert" a natural gas
                        plant
                        > to coal, as coal requires some elaborate and expensive machinery to
                        > handle it. I try to stay aware of electric generating technology and
                        > have never heard of a gas plant being converted to coal. If I am
                        wrong
                        > then please have mercy and point me to some education.
                        >



                        <GRIN> no problem! mercy is granted!

                        It's called "pulverized coal firing" and can be adapted to natural
                        gas boilers with 'minimal' modifications to the boiler itself.

                        However, there is extensive, elaborate and expensive machinery
                        required to stock pile the coal, move it to the pulverizer, then
                        inject the very fine, finer than talcum powder, powdered coal, almost
                        like an atomized mist, into the burner. Advantages are complete
                        combustion, minimal to no ash. Sulfur in the flue gases can be
                        treated by passing the flue gases through limestone creating gypsum
                        and carbon dioxide. We know gypsum as sheetrock.


                        David, CEO
                        The GREAT Grand Funk Northern
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