Around Chicago

Recently I took a few photos around Chicago of things that caught my eye.

Upper left – someone started an impromptu art project by putting orange string on the bridges across the Chicago River.

Upper middle – a car escapes the impound lot on Halsted avenue near the projects

Upper right – a strange bell that shows the weather; unfortunately it seems to be stuck on “colder”. Maybe this is the “misery bell” because this spring has been lousy…

Lower middle – I recently saw a guy trying to steam the junky, dirty snow off the street. This was new to me. Unfortunately he just gave up and started chipping away with a shovel and put it into the street, old school-style

Lower center – there is a big “Palm” advertisement with Trump Tower in the background. I remember when I bought my first palm pilot, probably a decade ago, and Palm was “cool”. Recently a stock analyst put a price target of ZERO on Palm’s common equity for their stock price… um that’s not good. But at least they can afford an expensive billboard

Lower right – another new billboard appeared in the neighborhood – this one is for “Cats Against Clay“. Apparently kitty litter is bad for cats. Or the price of a billboard is now so low that anyone can rent one. Perhaps one for LITGM, or Chicago Boyz?

Waking Up That Wind Isn’t The Solution

Wind power, like nuclear power, has incorrectly been described as a key part of the solution to electric generation in the USA. T Boone Pickens, the famous wildcatter, had a plan to develop large wind generating plans across the central US. Back in mid-2009 he folded his tent, noting that there wasn’t any prospect of building transmission lines to bring wind power from where the wind is best to the cities where the demand resides, as I noted here. Anyone remotely familiar with the actual capabilities of financing transmission nowadays knew it was a fools errand, since routing a transmission line literally takes over a decade of permitting and routing is often very inefficient, such as in this case.

The Chicago Tribune finally awoke to this situation in a decent article in the Sunday paper, titled “Putting Wind Generated Power Where It Is Needed“.

In the near term, companies are opting to harness wind power closer to existing transmission lines, usually near urban areas, to avoid the lengthy and costly process of building new lines. Aside from pockets of strong winds in the midsection of Illinois, however, some of the most powerful wind in the U.S. stretches from the upper Midwest, south, into Texas.

In order to integrate and move that alternative power east through Illinois, the grid would have to be expanded and upgraded, say transmission experts and utility companies.

The estimated cost to move that wind power east could range from $64 billion to $93 billion in 2009 dollars and would require 17,000 to 22,000 miles of transmission lines to be built in the eastern half of the country alone, according to the Eastern Wind Integration and Transmission Study (EWITS) published in January and prepared for the National Renewable Energy Laboratory.

The Chicago Tribune even included a nice graphic that is in the post above; it clearly shows where the prime wind territory resides (west of the population centers in the Midwest) and the lack of transmission to bring this power to market.

“In many instances, interconnection studies indicate that adding a new power plant would overload transformers and transmission lines hundreds of miles away,” the American Wind Energy Association and the Solar Energy Industries Association concluded in a white paper published last year. “…Its owners must pay to upgrade all of the transmission equipment, often at a cost approaching or exceeding the cost of the power plant itself.”

While the journalist at the Chicago Tribune has finally stumbled upon the truth, which is that the best territory for wind generation is not located near population centers AND the cost and time of setting up the transmission grid far surpasses any reasonable possibility that this would reasonably occur, the writer fails to reach the logical conclusion of the situation, which is:

WIND GENERATION IS NOT A VIABLE SOLUTION IN THE MIDWEST BECAUSE THERE IS NO TRANSMISSION GRID TO DELIVER THE POWER, AND THERE IS NO REASONABLE POSSIBILITY THAT WE WILL DEVELOP THE GRID OVER THE NEXT FEW DECADES.

Thus, the reasonable conclusion is, we ought to stop talking about wind power in the Midwest and move on to more practical options.

Too bad that isn’t going to happen and journalists are going to keep talking about wind power like it is viable, because they don’t know any better, and most readers will keep reading it as if it’s true.

Cross posted at LITGM

Energy Futures Holdings (EFH) Revisited

Energy Futures Holdings (EFH) is a large utility based in Texas that used to be TXU. They were taken over by private equity in one of the largest buyouts during the “peak year” of 2007. I wrote about them here as they began to have problems repaying their monstrous pile of debt which mainly comes due in 2014. If you go to this file on EFH’s web site and go to page 12 you can see the $20B in debt coming due on that date (EFH is privately held and thus does not have a stock ticker but since their debt is publicly held they do have analyst presentations).

The New York Times wrote an article on the EFH buy out titled “Power Players, Unplugged” on February 28, 2010. While we may take the NY Times to task from time to time on politics in general I find their business writing to be of high quality.

They sum up the deal as so:

The buyout was, in effect, a gargantuan bet that natural gas prices would keep climbing; instead, plunging prices coupled with a hobbled national economy have cut into the cash the company generates.

Investors who bought $40B of TXU’s bonds and loands – including legendary wise men like Warren Buffett – have seen huge losses as most of the bonds trade between 70 and 80 cents on the dollars. The other $8B used to finance the buyout came from the private equity investors themselves… analysts say that this latter stake currently has little value.

Read more

Hubbard Street Dance Facility


I do not know much about modern dance but went to a show at Hubbard Street Dance on the north end of Millennium Park (right behind the cool music shell) and their facility has interesting colors and neon lights. I only had my crappy blog camera with me and took some photos. It reminds me of an updated version of the United Airlines connecting tunnel between terminals B and C at O’Hare.