“How Renewable Energy Is Taking Over the Electric Grid” – The Motley Fool, 6 September 2014

Renewable energy might very well beat out coal, nuclear, and natural gas as our number one source of energy. This July, every new power generating plant that opened in the US sources renewable energy.

Renewable energy is seeing an upsurge because it’s the cheapest energy alternative. Natural gas is beating wind and solar power by only a small margin in this year’s installed capacity (MW). If residential and commercial rooftops using solar power — called distributed solar energy — were added to the equation, then the number of solar units installed would be equal to natural gas in 2014.

US Energy Information Administration

US Energy Information Administration

While the previous table tells us the source of electricity generation, we should note that wind and solar energy only make a small percentage of the energy we actually use in the US.

US Energy Information Administration

US Energy Information Administration

Renewable energy’s climb is slow, but the trend is showing that renewables will soon replace coal and nuclear power. Natural gas remains a favorable source because it is still low in cost and can retain renewables and other energy sources for future use.

The US Energy Information Administration (EIA) published further data that shows how the US’s electricity prices have grown over the year. While costs rose in New England and the Mid-Atlantic due to increased wholesale prices from electricity generators, costs decreased on the Pacific coast — California, Oregon, Washington — because these states have installed more solar energy in the last year.

Renewables are a superior energy source in comparison to fossil fuels. Not only can wind and solar energy become cheaper, but both also prevent more greenhouse gases from being released into our environment.

Developed and Written by Dr. Subodh Das and Tara Mahadevan

September 8, 2014

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Copyright 2014. All rights Reserved by Phinix, LLC.

www.phinix.net    skdas@phinix.net

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“Will All-Aluminum Cars Drive Metals Industry?” – Wall Street Journal, 13 January 2014

Obama’s 2010 mandate that obligates car manufacturers to double new-car average fuel economy by 2025 has pushed the car industry to produce more fuel efficient cars at a faster rate. Ford’s next F-150 — the US’s largest selling vehicle — is currently being redesigned and rebuilt with an all-aluminum body, a huge helping hand to both Obama’s fuel efficiency mandate and the aluminum industry.

Two big players in the Ford’s aluminum round-up are Alcoa and Novelis, the nation’s top aluminum sheet producers. In 2013, both companies spent $1 billion in opening new aluminum sheet factories, tailored to the auto industry. Raw aluminum prices have dropped by more than a third since 2011 — Alcoa and Novelis are hoping their new investments increase their profit margins.

The aluminum industry is making a huge bet. While aluminum is lighter, and better for fuel efficiency and the economy, it might not be better for pocketbooks — aluminum costs almost three times more than steel, the traditional metal used to manufacture cars. Moreover, using aluminum to produce vehicles requires new machinery; machinery used to manufacture cars from steel isn’t compatible with aluminum.

Only Audi and Jaguar — cars that a majority of the public can’t afford — have created all-aluminum vehicles. Ford’s new endeavor will likely trim 700 pounds from the currently-5,000-pound truck; this reduction will allow for a 7% growth in the truck’s fuel economy.

The aluminum market is now only valued at almost $300 per year. If more car companies choose to manufacture all-aluminum cars, then the market can skyrocket to $7.5 billion by 2025, a huge blessing for the aluminum industry, which is undergoing oversupply and low raw aluminum price issues.

The car industry is urging every aluminum company to invest, asking different manufacturers to produce different parts so there isn’t one that could dominate pricing. There is more than enough business for everyone: one contract for a mass-produced part can be valued at more than $50 million.

The question is, will there be enough raw aluminum materials and fabrication capacities to successfully undertake this venture, even though time has come to further enhance recycling and production of recycle-friendly automotive aluminum alloys in commerce? See a publication on this subject by Dr. Das – “The Development of Recycle-Friendly Automotive Aluminum Alloys“.

See also:
A Clean Car Boom
GM Planning Strict Diet for New Pickup Trucks

Developed and Written by Dr. Subodh Das and Tara Mahadevan

January 13, 2014

Phinix LLC

Copyright 2013. All rights Reserved by Phinix, LLC.

www.phinix.net    skdas@phinix.net

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“Aluminum Probe Focuses on Costs to Users” – Wall Street Journal, 13 August 2013

We previously reported on Goldman Sachs and JPMorgan Chase’s expensive aluminum storing and delivery practices, which, in August, were called into question by the Commodity Futures Trading Commission (CFTC), an independent agency of the federal government that regulates futures and option markets.

The CFTC believes that some Wall Street Banks have falsely inflated the prices of aluminum and other metals stored in their facilities, in order to make a buck (or well over a buck) from end users and consumers. The CFTC sent subpoenas to firms like JPMorgan and Goldman — as well as Goldman’s aluminum and metal storing facility Metro International Trade Services — requiring them to present recordings of their commodities operations from January 2010 and onward.

The firms developed a habit of shuffling their stores of aluminum, and holding on to them longer, in order to inflate prices; the additional time increased storage costs that are included in the aluminum price when delivered. The London Metal Exchange, which is in charge of creating pricing regulations, approved some of the firms’ warehouses that were subpoenaed.

Wall Street’s association with commodity and energy markets is being closely examined. Before the 1980′s, banking institutions weren’t allowed to own non-financial businesses — Congress wanted to reduce the risks banks take, as well as safeguard depositors. However, after the 1990′s, Congress and the Federal Reserve allowed some banks to develop businesses in storing and transporting commodities.

Both JPMorgan and Goldman have denied the allegations, maintaining that customers don’t face a wait time, and would receive shipments immediately. They also noted that delayed deliveries were due to client orders and not the firms themselves.

Time to move buying, selling and pricing back to inventory decisions, basing the metal market upon true market supply and demand from actual producers and consumers, rather than speculators and investment bankers.

Developed and Written by Dr. Subodh Das and Tara Mahadevan

September 25, 2013

Phinix LLC

Copyright 2013. All rights Reserved by Phinix, LLC.

www.phinix.net    skdas@phinix.net

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