As hope for the renewal of crucial tax credits for solar and wind was fading, the Senate made a last-ditch effort to keep them alive. They added it as a sweetener to encourage passage of the financial bailout after the previous bailout attempt failed the House on Monday. Now all eyes are on the House to see if they approve, even though this version still doesn’t address a key House concern regarding the tremendous amount of national debt it adds to our struggling federal coffers. With Senate passage in a bipartisan vote and the market reaction on Monday, it seems the House will let this bill through. But we will see.
The weekly natural gas report showed strong growth in inventories due to mild temperatures and some recovery in Gulf production post-Ike. This report, along with dollar strengthening today, will likely pressure natural gas prices to remain below $8 per MBtu in the near-term.
In oil news, Russia’s September production remained below last year’s level for the ninth month in a row, all but guaranteeing that 2008 will be the first year since 1998 to exhibit falling production. Russian lawmakers have reduced taxes to incentivize higher production, but they may run into the same relentless declines that have faced other countries like Mexico, Norway and the US. If that is the case, we will become very dependent on OPEC to supply larger amounts of oil — a precarious energy future to say the least.
Tomorrow, I will discuss two reports that just came out: 1) warning of a potential electricity capacity crisis in the US within the next ten years and 2) Google.org’s plan to replace fossil fuels with solar and wind energy.
Onwards in the sustainable energy transition-
Tags: bailout, Natural Gas, Oil, renewable energy tax credit, Russia