Fall 1997

The Radioactive Way... continued...

Waste With An Accent

Beginning as early as next spring, the number of spent fuel shipments could begin to increase even though a permanent storage site has not been picked. About 125 shipments of spent nuclear fuel from foreign reactors will be made from Savannah River, South Carolina to Idaho Falls, Idaho beginning in spring 1998. These shipments were agreed to under the Nuclear Nonproliferation Treaty.

While the route these shipments will take is undetermined at this time, the spent fuel will likely be shipped by truck and Nebraska's interstate highway is a prime candidate. About ten shipments of foreign nuclear waste will be sent yearly for 13 years.

Seven Times A Day, Everyday

Congress may try to open the nation's interim nuclear waste storage site in Nevada as early as 1999. In April, the Senate passed legislation proposing to do exactly that. The House of Representatives has just begun consideration of the issue, but expects the bill, H.R. 1270, to reach the floor of the House for final action yet this year.

If and when a site opens in Nevada, Nebraska will see a 125-fold to 250-fold increase over current levels of nuclear waste shipments.

A projected 3,000 shipments a year will use the state's highways and train tracks. Instead of one or two shipments a month, state troopers may be escorting seven shipments a day, every day for about 30 years. The train and truck shipments will course through the state's busiest and least trafficked regions equally.

When a truck shipment of nuclear warheads slid off an icy road 40 miles south of Valentine last November, Nebraskans learned about the special precautions taken when nuclear materials are involved in an accident. While no one was injured in the accident and there was no radioactive leakage, the road was closed for several hours. A special tow truck from South Sioux City traveled 12 hours in a blinding snow storm to the accident scene to right the overturned truck. The towing service was paid $25,000 for its efforts.

It Could Be Worse

Nebraska will be spared an additional 38,000 waste shipments from eight nuclear weapons production and storage centers headed for permanent storage at the Waste Isolation Pilot Plant underground salt caverns near Carlsbad, New Mexico. These shipments are also scheduled to begin next spring.

The nearest weapons production centers are in Ohio and Colorado and the waste shipments will travel directly south to the New Mexico storage area.

Getting Ready

While state officials have been preparing for the waste shipments for years, more work remains. Among those issues left unresolved are training for emergency personnel and security costs.

The federal government, under the Nuclear Waste Policy Act, is obligated to provide states with technical assistance and funding for nuclear waste shipments being sent to a temporary or permanent storage facility.

Some states that are likely to see dramatic increases in radioactive waste shipments are imposing state permit and fee requirements, in part, to finance emergency personnel training and security costs. Nebraska's legislature has not passed any laws requiring permits or fees associated with these shipments.

Stay tuned. The nuclear waste story has many facets that the Quarterly will be examining in future issues.

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Home Mortgages at Below Market Interest Rates

Leaving the busy highway and leisurely driving through any Nebraska town will confirm what most housing experts already know: homes are built to last many decades, and most do.

According to a state government report, nearly a third of the homes in the Nebraska were built 60 years ago or longer.

Decisions made at the time a home is built, can have decades-long ramifications. One of the rationales behind energy efficient mortgages is that it is far less expensive to build a home to use energy more efficiently than try to add the energy saving features after a home is built.

Lower Bills, Bigger House

Another energy efficient mortgage concept is that people who own a home that uses energy wisely can afford to pay more on the mortgage because their utility bills are lower.

National lenders such as Freddie Mac, Fannie Mae and the Veterans Administration have offered energy efficient mortgages for several years. These mortgages offer more liberal income-to-debt and loan-to-value ratios, but have not been widely used by homebuyers.

Last summer, the Energy Office, in cooperation with the state's lenders, began offering energy efficient mortgages with a difference: the more energy efficient the home, the more the interest rate on the mortgage loan is reduced, up to a maximum of 1 percent.

The mortgage loan fund is capitalized with $2 million in oil overcharge funds. Oil overcharge funds are a result of various court actions against oil companies that overcharged their customers during the period of federal energy price controls from 1973 to 1981.

The Lucky Few

In less than a year and with almost no marketing, the agency has financed 43 homes totaling $4.6 million with energy efficient mortgages. Another 20-30 homes are likely to be financed with the original oil overcharge funds. “We had originally hoped to finance 300 homes with these mortgages,” John Osterman of the Energy Office said. “We underestimated the number of new homeowners willing to build a home that is 30 percent above current energy codes.” Osterman said more of the agency's funds are used when homebuyers select the most energy efficient option.

Loan repayments from the first mortgages will allow the agency to finance additional homes in the future. The Energy Office projects 5-15 homes a year could be financed with the mortgages. “Unfortunately, the number of homes financed is minuscule compared to the 4,500 built yearly in Nebraska,” Osterman said. “The Energy Office has proved there is a large demand for energy efficient homes.”

The Energy Office purchases 5, 10, or 20 percent of the permanent mortgage at no interest on qualifying homes, based on the efficiency level the homebuyer plans to meet. The efficiency level selected can reduce the mortgage loan rate by 1/4, 1/2, or 1% respectively.

For more information about energy efficient mortgages, contact John Osterman in the Energy Office.

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Saving Jobs, Air and Dollars All Across Nebraska

Whether viewed as an environmental effort, a jobs creation undertaking, housing rejuvenation, or just plain “saving Nebraskans hard-earned dollars,” Dollar and Energy Saving Loans will continue to generate benefits for the state and its citizens for decades to come. Since the loan funds “recycle,” these loans can continue to be offered to Nebraskans forever.

15,000^th Loan in 1998

The loans became available to Nebraskans in mid-1990. Since that time, more than 13,000 projects have been financed, 92 percent of the projects in the homes of Nebraskans. To date, more than $80 million in projects have been financed with these low-interest loans. Each year, about 1,700 new loans finance projects totaling $10.8 million. Of this amount, nearly $10 million is spent on residential improvements, making this the state's largest, albeit narrowly focused on energy efficiency, housing rehabilitation effort.

Clean Air Effort

When viewed from an environmental standpoint, the loans may represent the state's largest, on-going commitment to greenhouse gas emissions reductions. Greenhouse gases carbon dioxide, sulfur dioxide, nitrous oxides and particulates are responsible for air pollution, acid rain, and global warming. Each year, the improvements made with the loans account for reductions of 40,000 tons of carbon dioxide, 142,500 pounds of sulfur dioxide and nearly one-quarter of a million pounds of nitrous oxides.

Putting some of the carbon dioxide reductions into context, in seven years the agency's loans have resulted in the equivalent of removing 9,516 vehicles from the state's roads.

Jobs and Money in Nebraskans’ Hands

Through June 1997, the loans have created the equivalent of 1,416 jobs, primarily among heating and cooling contractors and remodeling industries all across the state.

The savings earned by Nebraskans who used the loans to finance improvements in their homes came in two ways: savings from reductions in energy use and savings from lowered financing costs. Since 1990, the dollars saved by Nebraskans from reduced energy use total $16.9 million and the savings from the reduced financing costs total $15.86 million.

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Editor’s Note: This is the third in a periodic series on energy milestones in Nebraska.

“Terrible Terry” and the Birth of Oil Refining

For more than forty years, Nebraska's only oil refinery processed Wyoming crude oil into retail products such as gasoline and tractor fuel for sale here and in adjacent states. The refinery's origins were humble and based on necessity.

Legendary entrepreneur and former state senator Terry Carpenter opened a single service station selling cut-rate gasoline in the late 1920s in Scottsbluff. Carpenter later expanded his operation to a chain of fifteen stations in Nebraska and beyond.

The Scottsbluff refinery was built during the 1930s by Carpenter to supply gasoline to his stations. Capitalizing on a nickname bestowed on him by the Omaha World Herald, the gasoline was marketed under the trademark, "Terrible Terry."

Competition from Co-ops

Throughout the 1930s, petroleum refining and retailing was changing dramatically in the region. Not only was Carpenter's operation growing, but the consumers' cooperative movement was gaining momentum.

In 1929, six local cooperative associations in Missouri, Kansas and Colorado decided to pool their petroleum product orders as well as orders for other farm supplies to obtain lower prices. With $3,000 on hand, Consumers Cooperative Association was born.

By the end of Consumers' first year, the Association had 22 members and sales of $309,891. In the next ten years, Consumers grew to 259 owner-cooperatives and produced more than 200 products.

In 1940, Consumers entered the petroleum refinery business. The 70-mile long oil gathering pipeline terminated at a refinery in Phillipsburg, Kansas. The nation's first cooperatively-owned refinery used 3,500 barrels of crude oil daily, but was inadequate to meet the needs of Consumers' growing business.

Carpenter Sells Out

A year later, Consumers purchased the 1,500 barrel Scottsbluff refinery from Carpenter for $1 million. Later, Consumers doubled the capacity of the refinery and operated it until 1982, when the refinery closed.

By the 1980s the era of the small refinery had passed, especially those located far from the oil fields.

After closing, the refinery was dismantled and most of it moved elsewhere. However, several storage tanks were purchased by Panhandle Co-op in Scottsbluff.

From Rags to Riches and Oil to Pigs

And what became of Consumers Cooperative Association? In 1966, Consumers changed its name to Farmland Industries. At its 50th anniversary in 1979, Consumers now Farmland had become one of the nation's largest farmer-owned cooperatives, with its pork processing subsidiary, Farmland Foods, emerging as one of the nation's leading meat companies.

Petroleum remains one of Farmland's major business lines and the company is one of the state's major petroleum product suppliers.

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A Future Energy Generation Option for Rural Areas

As the Mars Sojourner rover amply demonstrated, future success in many areas could rest on combining low-tech with high-tech to find the most practical and cost-effective solution.

Find Out More

Low- and high-tech could also be the future of electricity generation for some living in rural areas.

Researchers have predicted that in a few years biomass or renewable organic matter such as forest residues and agricultural crops and wastes will power fuel cells that generate electricity.

These biomass fuel cell proponents will be at a workshop, September 30 and October 1 at Arbor Day Lodge in Nebraska City, Nebraska.

A fuel cell is a device that converts the chemical energy of fuel directly into electricity. The fuel cell does not burn the fuel and does not need to produce steam. Using a fuel cell option, steam can be produced as part of a cogeneration system. The fuel cell uses an electro-chemical process that causes hydrogen atoms to give up their electrons.

Fuel cells have already produced power and heat for dispersed generation using indigenous biomass and waste-derived fuels. These power plants can provide energy on-site while reducing energy costs. Fuel cells also use highly efficient power generation technology that is environmentally clean since biomass is the “fuel.”

A Power Plant in the Heartland?

The workshop organizers' goal is to provide attendees with the status and economics of biomass fuel cell power plant technology and identify possible partners in building a rural biomass fuel cell plant.

The Electric Power Research Institute workshop is sponsored by the U.S. Department of Energy's Western Regional Biomass Energy Program and Nebraska Energy Office.

For more information about the workshop, contact Jean Ku at Energy Research Corporation, phone 203-825-6215, or Email Jeff Graef, in the Energy Office.

Workshop at a Glance

September 30

• Perspectives from federal energy and ag agencies, ethanol and corn producers and environmental interests
• Fuel cell technology
• Feedstock and rural development issues
• Applications
  • On the farm
  • Ethanol plants
  • Digesters
• Domestic and foreign markets

October 1

• The economics
• Finding a project and supporters
• The business plan
• Commercializing fuel cells
• What is next?

Keynote speakers and others sessions as well as meals are also scheduled.

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The Nebraska Energy Quarterly features questions asked about 6% Dollar & Energy Saving Loans.

Loan forms may be obtained from participating lenders or the Energy Office.

Loans to date: 13,063 for $62.4 million

Questions and Answers...

6% Dollar & Energy Saving Loans

Why is there a special form (Form 2 Roofing) for insulation added to the attic?

Form 2 Roofing is only used when a ceiling or attic insulation project requires repair or replacement of a leaking roof. Typically, adding insulation to an attic or roof does not include roof repairs. However, it the roof leaks, the new insulation must be protected from water damage. Form 2 Roofing asks how that will be accomplished.

If the insulation project does not involve roof repairs, then use standard Form 2 and describe the project on line 13.

Why is insurance information required on Form 2 Roofing?

If the leaks in the roof were caused by an insured casualty, such as a hail or windstorm, and the borrower is collecting damages, then the amount of the insurance payment must be deducted from the loan amount. Loan funds can only be used to pay the borrower's actual, out-of-pocket expenses.

“Whole Unit R-values” for replacement windows or glass doors must now be listed on Form 2, Line 7. What are these values and why are they important?

From the beginning, any double-paned window could be financed with a Dollar and Energy Saving Loan. Many of the replacement windows were not significantly more energy-efficient than the windows being replaced, which undermined the purpose of the loans.

Starting January 1, 1997, replacement windows must meet a minimum performance criterion just like insulation and heating and cooling equipment. Since windows are assembled of several different components (glass, sash, and frame) the insulating ability of the entire unit, called the “R-value,” is now the measurement standard for the loans. Some manufacturers only list the center-of-the-glass R-value. For the borrower to receive a loan, the “whole unit R-value” must be at least 2.5.

Windows that have a 2.5 R-value or higher represent the top 25 percent of all windows manufactured. The National Fenestration Rating Council or NFRC has established test and certification programs to prove the R-value of windows. The easiest way to demonstrate that a particular window meets the minimum loan standard is to include a Council test report or its equivalent along with the application and bid.

I'm replacing a door. Form 2, Line 14 lists minimum R-values for doors and door systems. Do doors have R-values, too?

Yes, the National Fenestration Rating Council also tests and certifies doors for R-values. Some pre-hung doors are sold as a system which includes the door, frame and lites glass areas above, beside or within the door. To be financed with a loan, door systems must have an R-value for the entire assembly of at least 4.0. If an insulated slab door is sold separately, it will not have a Council rating, so the door must have an R-value of 8.0 to be financed with a loan.

Glass doors, such as sliding doors or patio doors, must meet the whole-unit R-value of at least 2.5 on line 7, Form 2.

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35,000 More Homes Needed by 2000

That's an ad most members of a state group trying to find ways to build more affordable houses in Nebraska would like to see. The reality, however, is quite different.

According to the Affordable Housing Trust Fund Advisory Committee, that advertised brand-new home for a first time buyer in Nebraska would typically cost between $80,000 and $95,000. The family buying the house would need to earn $12.50 to $14.50 an hour to be able to afford the home. Yet, the four fastest-growth employment sectors only paid hourly wages of $5.61 to $12. The Committee concluded the cost of construction of single family homes is rising faster than wages.

In August, the Wall Street Journal reported a blistering 7.6 percent rise in wages and salaries for the second quarter of 1997 in the region that includes Nebraska. But, the article also pointed out wages in the region are generally lower than in other states. For example, while U.S. average hourly wages in July for manufacturing workers exceeded $12 per hour, wages for similar workers in Nebraska were less.

Average sales prices of single family homes in the state run even higher $105,000 to $134,000. To stay below the recommended 30 percent gross income limit for house and utility payments, people buying average priced homes in Nebraska would have to earn between $18-$22 an hour.

It is the Committee's task to couple housing needs with current and new financial resources to dramatically increase the level of affordable housing in the state. This year, The Legislature redirected $4 million a year for the next six years from state tax funds to increase the availability of new affordable housing.

One in Four Pay More

“Affordable housing” means that homeowners pay no more than 30 percent of their gross income for rent and utilities for safe, sanitary and decent housing. Energy costs such as heating, cooling, lighting, supplying water and other resources need to be included in housing costs because of their long-term impacts.

The Advisory Committee reported that “nearly one in four Nebraskans pay more than 30 percent of their gross income for rent and utilities...resulting in serious housing cost burdens for some residents...”

Not only is the cost of housing and utilities a factor, but so are wages. If the occupant's income is less than 80 percent of the region's median income or middle income range, then residents may have difficulty affording other items such as health care costs and quality child care.

At the Governor's Housing Summit earlier this year, the Energy Office said building an energy efficient home costs $3,000-$4,000 more than standard construction. However, that same home will save 30-40 percent on heating costs and 15-20 percent on electricity bills.

Pocketing $400-$500 A Year

Using 1992-1995 average fuel prices, the savings from an energy efficient home would be $416-$555 annually, recovering the cost of the investment in about seven years. Using winter 1996-97 prices, the annual savings would have been higher, from $464-$619.

Making similar improvements in an existing home can reap nearly identical savings. An Energy Office evaluation found that installing a 90+ percent efficient furnace instead of an 80+ percent efficient furnace saves an additional $64 annually using winter 1996-1997 fuel prices. The additional cost of the more efficient furnace is only about $400. The cost of the improvements will be recovered in less than seven years, far less than the 20-30 years the furnace will last.

The state's Economic Development Department is spearheading the affordable housing effort with the Nebraska Investment Finance Authority.

Throughout the fall and early winter, the agencies expect to meet with Nebraskans across the state to develop rules on how the affordable housing trust fund will be spent.

March 1998 is the earliest projection for the funding becoming available for specific projects.

For more information about affordable housing, contact Julie Hendricks at the Department of Economic Development at 402-471-3111 or 800-426-6505.

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Making Home Buying Affordable NOW!

Some Nebraskans looking for new homes have an option when they find the house they want to purchase is just out of reach financially.

"The Weatherization Energy Efficient Mortgage is not for everyone," Pete Davis of the Energy Office said, "but for a few people, it can make a big difference. The concept behind these mortgages is that energy saving improvements are made to the home so utility bills will be substantially reduced. That way, the new homeowners will have an easier time of making the mortgage payments."

The below market rate weatherization mortgages typically finance improvements such as attic and wall insulation, new furnaces, caulking and weatherstripping.

Weatherization mortgages are available to only those who have limited incomes.

"Getting a weatherization mortgage is very simple," Davis said. "First, the lender verifies a person's income, then conducts an energy audit of the home the borrower wants to buy and finally makes recommendations on ways to reduce energy use."

For more information about weatherization mortgages, contact Pete Davis in the Energy Office.

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A Snapshot of Nebraska's Housing

• Nebraska's housing stock is aging and deteriorating -- 29.3 percent of housing units statewide are 58 years or older.
• Nearly one in four Nebraskans pay more than 30 percent of their gross income for rent and utilities.
• A shortage of buildable lots -- lots with infrastructure in place and/or vacant land that can be developed for housing -- is being experienced by many Nebraska communities.
• Nebraska has an estimated need for more than 34,860 additional housing units between 1995 and 2000.
• Nebraska has a shortage of builders, contractors and laborers, compounded by a lack of workers trained and being trained in construction trades -- especially in rural areas.
• The minimum cost of a new 1,000 square foot, three bedroom ranch-style starter home (with no garage, an unfinished basement and one bathroom) in Nebraska is $70,000.
• ...the cost of construction of single-family residences is rising faster than wages.

Excerpt: The Affordable Housing Trust Fund Advisory Committee. The “Introduction of the Report.” December 1996.

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Earth Dog to the Rescue

To save our environment, Earth Dog needs the help of some creative children.

Introduced by the Department of Energy, Earth Dog is the name of a fun, furry, global, cartoon crusader, who educates children about problems facing our environment and gets them involved in creating solutions.

Earth Dog, an environmentally concerned canine, needs creative kids to solve Earth's problems.

Enter a Contest

Students can help Earth Dog by entering a contest in which they create new cartoon adventures.

To enter, pick an environmental problem and research it. Explain to Earth Dog how it developed (in 250 to 700 words) and make up a way Earth Dog can help solve the problem.

Winners can earn cash prizes, get their stories published on the Internet and win their school Internet terminals from Web TV, one of the contest's sponsors. Twenty winners will be selected.

Deadline to enter the contest is November 30, 1997.

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Building Homes Nebraskans Can Afford October 22 and 23

The state's sixth annual conference on Affordable Housing will be held in Kearney at the Ramada Inn Hotel October 22 and 23, 1997.

“Housing Our Community” will feature workshops on public and private partnerships and other topics that include training and technical assistance.

To find out more about the the conference, contact the Department of Economic Development by phone at 402-471-3119 or by fax at 402-471-3778.

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Information Services and Resources

Governors' Ethanol Coalition

The 21-member Governors’ Ethanol Coalition opened a web site to broaden the public's understanding of ethanol (Govenors’ Ethanol Coalition).

The Coalition is bipartisan organization with representatives from 20 states and one territory as well as Sweden and Brazil.

The group was formed by Nebraska Governor Nelson in 1991 to increase the use of ethanol, decrease the nation's dependence on imported energy resources, improve the environment and stimulate the national economy.

Visitors to the web site will find a list of the gubernatorial members, their representatives, recent publications including the Ethanol Alert (a quarterly publication for policymakers and advocates) , Ethanol Source (a sporadically-published, one-pager for policymakers and journalists), reports from the organization and others, news releases, calendar of events and links to state, regional, national and international ethanol resources.

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1996 Nebraska Crude Oil Production by County

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Energy Efficiency and Renewable Energy Clearinghouse

The Department of Energy’s Office of Energy Efficiency and Renewable Energy (EERE) provides fact sheets, brochures, videos and publications on energy efficiency and renewable energy.

Office of the Assistant Secretary
Energy Efficiency and Renewable Energy
Mail Stop EE-1
Department of Energy
Washington, DC 20585

Toll Free: 1-877-337-3463

Energy Efficiency and Renewable Energy (EERE)

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Ongoing

Mission

"The mission of the Nebraska Energy Office is to promote the efficient, economic and environmentally responsible use of energy."

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American Disabilities Act

In accordance with the American Disabilities Act, the state will provide reasonable accommodation to persons with disabilities. If you need reasonable accommodation to participate in any program or activity listed in this publication, please contact the Energy Office at 402-471-2186 to coordinate arrangements. Upon request, this publication may be available in alternative formats.

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U.S. DOE Grant

This material was prepared with the support of the U.S. Department of Energy (DOE) Grant No. DE-FG47-92CE60410. However, any opinions, findings, conclusions, or recommendations expressed herein are those of the author and do not necessarily reflect the views of DOE.

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