08:02 – Next week’s vote on Scotland’s independence from the rest of the UK (rUK) has a lot of people running scared. There’s a great deal at stake, not least the stability of Europe as a whole. If Scots vote in favor of splitting from the UK, it may well be the first in a row of toppling dominoes. Ambrose Evans-Pritchard’s article is worth reading: Only Germany is holding together as separatists threaten to rip Europe apart
My guess is that Scots will vote to remain a part of the UK, but it’s likely to be close. Put simply, Scots would be crazy to vote for independence. Scotland is poor. The rUK subsidizes Scotland to the tune of several thousand pounds per year for every Scottish man, woman, and child. With independence, that subsidy disappears and the Scots’ standard of living immediately plummets. The only real asset Scotland has is the North Sea oil and gas fields, whose output peaked 15 years ago and is rapidly declining. It’s unlikely that the EU will accept Scotland as a member, nor will it be able to adopt the euro. All of the UK political parties have said that Scotland could not continue to use the UK pound, other than in the sense that Panama uses the US dollar. Scotland would end up alone and isolated, and the economic consequences would be disastrous. None of which guarantees that Scotland will not vote for independence.
Could this be the first PRC in Tejas?
Federal authorities want to build a new South Texas immigration lockup for families amid an unprecedented surge in the number of youngsters pouring across the U.S. border, a federal official said Thursday.
I hope the Scots aren’t foolish enough to leave but if they do, well, that’s their choice.
Same with Catalonia, the Basque Country and so on. It would be nice if this fragmentation was acompanied by smaller, more affordable government, but I’m not expecting that.
And Ambrose Evans-Pritchard’s take on European vs US energy costs and the resultant industrial colapse in the former:
http://www.telegraph.co.uk/finance/financialcrisis/10295045/Brussels-fears-European-industrial-massacre-sparked-by-energy-costs.html
Yes, I mentioned differential energy prices here long ago. Fracking is killing non-US factories that manufacture plastics, chemicals or any other product that’s energy-intensive. With an energy cost advantage of 2:1 (some places, 3:1 or 4:1), nobody but nobody is building new factories elsewhere, and many perfectly good and relatively new factories are shutting down because they can’t compete on price.
Yet another reason why Scotland is foolish to count on North Sea oil and gas revenues propping up the socialist welfare state they intend to create if they secede from the UK.
I also hope that a new administration will take the ridiculous restrictions off coal. As someone once said, the US is to coal as Saudi Arabia is to petroleum. Of course, that was also before fracking.
Here in Oz they’re shutting down some aluminium smelters, I guess for economic reasons. That not only has an obvious effect on employment and tax revenues, but is freeing up electricity to (theoretically) drive down the price to consumers.
The only real asset Scotland has is the North Sea oil and gas fields, whose output peaked 15 years ago and is rapidly declining.
Ineos is getting ready to start fracking in Scotland:
http://www.hydrocarbonprocessing.com/Article/3379309/Latest-News/INEOS-hopes-fracking-in-Scotland-can-secure-cheap-gas-feedstocks.html
The combination of fracking and horizontal drilling is nothing short of amazing! Previous to these two extraction methods, the most you could hope to get out of a reservoir was a third of the oil and gas contained within. And that required such tertiary recovery methods as steam injection or carbon dioxide injection.
Now, they are thinking that we can produce up to two thirds of the reservoirs, a 100% extraction improvement. And, some of the engineers and scientists are starting to talk about 80% extraction of reservoirs.
Using these newer technologies, there is a wealth of oil and gas left in the North Sea. The only downside is that the investment required is high, very high.
Oh my goodness, xkcd is awesome today:
http://xkcd.com/1420/
“watches”
The worlds most ethical company (I know this because they made me sign a 40 page document attesting so), changed their payment terms from net 60 to net 122 on today’s contract extension. Amazing!
Here in Oz they’re shutting down some aluminium smelters, I guess for economic reasons. That not only has an obvious effect on employment and tax revenues, but is freeing up electricity to (theoretically) drive down the price to consumers.
Where does the bauxite come from? Many of the alumina and aluminum plants in the USA use bauxite from South American. The big alumina plant down the coast from here in Point Comfort gets about four ships a week now.
It may be your electricity cost has gone up so much that the plants are not economic anymore? Alcoa likes to use hydro power for their electricity costs to be low here in the USA. Even natural gas power is expensive. And the aluminum usage is going up quickly due to the Ford F-150 moving to a aluminum body on a steel frame for the 2015 model. Many other cars and trucks will be moving to aluminum also. The only real problem that I see with aluminum is that the body panels are riveted and glued instead of welded.
“Yahoo was threatened with a $250,000-a-day fine for pushing back against surveillance”
http://www.theverge.com/2014/9/11/6137371/yahoo-was-threatened-with-a-250000-a-day-fine-for-pushing-back
“Blackmail is such an ugly word. So is extortion.”
I haven’t worn a watch in more than 30 years, and I don’t intend to start wearing one.
AFAIK you can’t export NG wo explicit permission from DOE, so, the internal costs on US are artificially low.
Sure, it’s expensive now, but as you say it would formerly have been not just expensive but impossible to access these resources. As I’ve been saying for 40 years or more, all this wailing about peak oil is a load of crap. We have to date only scratched the surface, literally, of what’s down there. I doubt we’ve extracted even 0.001% of what will eventually be accessible. Still, as a chemist, burning this stuff offends me. It’s just like converting food to biofuel, except in this case we’re converting feedstocks to fuel.
RE: Scotland
Let’s assume the vote to secede FAILS. The vote to secede still accomplishes two things:
1) Shuts the separatists up. They scream about “let the people decide!” So, once the vote is over they really don’t have a leg to stand on. It’s back to grassroots campaigning to convince the average Joe why independence is a good idea and a very long uphill battle to ever get it back on the ballot again now that it’s already been voted down once. Really this will just pull the carpet out from under the separatist movement.
2) It does send a strong message to the UK which may result in additional autonomy for the region. This should probably be the intention of this all anyway. The UK should be thinking, “How do we make Scots feel more independent and give them more self-determination, but keep them in the fold of UK economics and foreign policy?”
Now, if they vote to secede, then that will be very interesting to watch unfold.
That’s been a growing problem with the world. Everyone with a different hair color, skin tone, religion, accent, etc. feels they need their own nation state.
Now, I’m going to go have a pull of my new bottle of Green Spot and shout “Free Occupied Ireland!”
When I was younger, I stopped wearing a watch because it annoyed me to feel like I was living my life as a slave to what time it is. As I got older, girlfriends (and then later, my wife) would notice I didn’t wear a watch and so buy me a pricey one as a gift and then I would feel obligated to wear it for a time. Now that I carry a smartphone in my pocket that will tell me the date and time anytime I glance at it, I see no point in having a watch. This was further cemented by the younger generation saying “only old people wear watches.” Now that Apple is making watches, perhaps the trend of young people wearing watches will change. I have no plans to begin wearing one.
I just wish the US would fragment into the 50 separate states it should be, with no feds to tell the states what to do. It’d be a pain in the ass for a while, but ultimately worth it.
I think the Obama Administration’s vendetta on coal is immoral. There are parts of the US that are dependent on coal for their survival and the Obama Administration is killing the last thread keeping them alive. I think that coal would still die without these restrictions, it would just give those poor people more time to figure out what to do when coal dies.
AFAIK you can’t export NG wo explicit permission from DOE, so, the internal costs on US are artificially low.
Natural Gas cost is the cost of production plus royalties plus profit. Although, many producers have selling natural gas at under cost so they can produce more oil. Flaring natural gas is becoming a highly frowned upon item now that the USA is the number two flarer in the world (Nigeria is #1).
The current cost of natural gas is about $4/mmbtu. Do you remember 2008 when it was $14? There is nothing artificial about the price of natural gas. Or crude oil. Both are commodities and can be readily sold if you deliver them to their respective marketplaces.
BTW, this winter may be very interesting from a natural gas viewpoint. With all the new natural gas power plants across the USA replacing nuclear and coal, we may see a tremendous price spike if we do have a very hard winter. Texas is 40/40/20% gas/coal/nuclear for power generation. The natural gas percentage is rapidly rising and the usage keeps hitting new highs each winter.
But, natural gas under high pressure wants to be a solid (hydrate) at 60 F. Extraordinary and expensive means have to be taken in order to keep this from happening. I hope all this stuff works! If central Texas drops down to 0 F then it will be tested hard.
I sympathize. However, I think history has shown that no matter how much notice you give them they will not figure out what to do when coal dies. US manufacturing has been dying for decades and still factory workers act shocked when their plant closes down. It’s as if US labor has a head in the sand attitude.
US manufacturing employment has been plummeting for decades, but US manufacturing itself is producing more than ever, just without many employees. Big difference.
Good point and you’re right. However, I think many people think of US manufacturing in terms of workers employed rather than widgets produced. Probably as a result of PR on the part of unions and their proponents.
Employment is immaterial. In fact if you can lower labor costs to zero, so much the better. All that really matters is output.
Interesting discussion; the place I work at now has been doing an average of 25% growth per year for the past several years; they have their fingers in a lotta pies; rowing machines; Nordic Track-type units; AK-47s; Danish furniture; exercise boards from Vietnam; website ownership/maintenance; sand-and-gravel and demolition operations; and centrally located between northern Novacadia and southern Novacadia.
The new kid started today; seems very bright, motivated and a plugger; I gave him the nickel tour of the site, got a table in there to serve as a desk, and pointed him at half a dozen desktops and laptops that were gathering dust and with unknown issues but functional. He went to town on them and had most of them up and running, including one new box that I screwed up to the point it wouldn’t boot anymore at all. I got him his accounts on AD and Exchange/Outlook, and he wasn’t concerned about loading Office/Outlook so he could read his mail on a PC; he just gets it on his phone. Got him hooked up that way, too, to the ancient (2007) Exchange server. Tipped me off to some nifty-looking ghosting/cloning apps, too; which I intend to start implementing in a big way there, having evidently never been done before. We need better redundancy on machines and the Production nabob is all up for that, as is the GM/CFO. I have a feeling we might be kicking some major ass there in IT pretty soon, and I saw a post-it note in HR (I have the grandmaster key to the works) about apparently looking to hire a PHP/MySQL sw engineer. Fah out. Pretty soon they won’t need me at all. Whatevuh, too; I can take it or leave it at this point. If it’s kinda fun and we kick some ass, I’ll stick around. If every, or most days, are a bitch, along with the 80 miles of driving each day, I may not, all depends. Folks there seem like salt of the earth good people, and almost all with English and Irish and Scottish names, too. Like Old Home Week in Vermont.
Temps in the low fotties at night here now and kinda brisk today, more like late September or early October. The storm broke three windows in the house and left a pile of broken branches and twigs all over the yahd. Gotta take pics tomorrow, file a claim, and do a dump run, all before noon. Then OFD can goof off and hook up the Sirius XM doo-hickey and set up channels for the vehicle. Maybe do the mods I’ve been planning for the Remington 870. And the S&W M&P Shield.
No peak oil? Fine by me; plenty of other bad chit out there to mess us up; the current regime seems to work overtime finding ways to wreck the country and its people. Now we’re gonna do mil-spec ops on the ISIS krew? Why not just let our bosom-buddy Israeli pals do that gig? They’re certainly capable. While they’re at it, we can provide air cover and intel while they turn Mecca and Medina into molten glass. As an example. About overdue by now.
Of course, price plus profit, but, if you allow to export, Henry Hub goes down and internal goes up, until equilibrium, if no, you have two markets.
I know about subsidized pricing, a lot, awfully.
Yup, Brent is $97 today and WTI is $92. Not much of a difference there. I’ve seen the split much higher. There are people now doing a very minor distillation, really a hot flash drum, and shipping out the hydrocarbon liquid offshore as a “condensate”. Works for me!
http://www.nasdaq.com/markets/crude-oil-brent.aspx
http://www.nasdaq.com/markets/crude-oil.aspx
I thought that you were talking about the stranded natural gas in the Rockies. I have heard of the pipelines buying that gas for 1 cent/mmbtu. I’ve also got a friend working in North Dakota. He has trouble sleeping at night because of a 16 burner flare by his hotel. I cannot even imagine that.
I would love to see our nation’s entire transportation network converted to natural gas, CNG or LNG, from diesel. Both 18 wheelers and locomotives. I have been thinking about getting a dual fuel (gasoline and CNG) Ford pickup but the $8,000 additional cost is just too much.
It does send a strong message to the UK which may result in additional autonomy for the region. This should probably be the intention of this all anyway.
They already have a Parliament for Scotland. They have their own flag, compete separately in some international sports, and have similar autonomy to a US state. They are a net recipient of funds from the rest of the UK. And they have been promised more autonomy.
Got an offer from Verizon on the cell phone tower. They require a million dollar property liability policy so we moved it to my nine acre property where I already have the insurance. The five acre property and the nine acre properties are connected to each other BTW.
The cell phone tower is going to be 168 ft tall and have a propane backup generator. They normally put in a diesel backup but the proposed location is next to my back pond and we don’t want diesel in the pond, no freaking way!
We are now hassling about price. They offered a $850/month lease with a 10% increase every five years. The lease is for five years with four subsequent renewals if they want to. The lease area will be 60 ft by 60 ft.
Strangeness in the Green Mountain State….
http://whowhatwhy.com/2014/09/10/update-louis-freehs-curious-car-accident/
Lynn wrote:
“The worlds most ethical company (I know this because they made me sign a 40 page document attesting so), changed their payment terms from net 60 to net 122 on today’s contract extension. Amazing!”
You mean you now have to settle their invoices within 122 days rather than 60 as before, or vice versa?
(Yes, I think I know the answer.)
Since money is now virtually free at the moment I don’t know why people/companies don’t pay quickly.
Lynn wrote:
“Where does the bauxite come from?”
Mainly up north and west, in the land of blowflies:
http://aluminium.org.au/australian-bauxite/australian-bauxite
“It may be your electricity cost has gone up so much that the plants are not economic anymore? ”
30-40 years ago aluminium companies tried to stitch up deals with state governments to get cheap electricity, from the (state owned) electricity companies. Now the electricity generators and distributors are mostly privatized so the smelters don’t get such sweet deals. I don’t know if the closures are being driven by lack of demand, input costs or the desire to achieve economies of scale.
Apparently, electricity costs so much here because the distributors over-invested in poles and wires (and generation capacity) and now people are generating more of their own power through solar panels and feeding the excess back in to the grid.
I thought solar power was just greenmailer nonsense but our host thinks it could soon be economic. Our governments tried to encourage this stuff a few years ago with huge subsidies on equipment and outrageously high payments for feeding excess back in to the grid. I thought it was a fad at the time but looks like it’s the next big thing. I often see houses with panels plastered on their roofs. I wish I’d got in on the ground floor.
“I haven’t worn a watch in more than 30 years, and I don’t intend to start wearing one.”
Probably a good thing you never associated with the British physicist (I think it was Sir William Penney) who was famously intolerant of lateness. If he agreed a meeting for 11 am, say, and you were than one or two minutes late he’d just leave.
Chad wrote:
‘Now, I’m going to go have a pull of my new bottle of Green Spot and shout “Free Occupied Ireland!”’
As a Cornishperson I’d almost like to see Cornwall secede from the UK. They’ve oppressed us for long enough, coming for holidays and eating our wonderful Cornish pasties.
Lynn wrote:
“There is nothing artificial about the price of natural gas. Or crude oil. Both are commodities and can be readily sold if you deliver them to their respective marketplaces.”
That’s why NG prices in Australia are set to skyrocket. Local prices have been held low by lack of exports, but now that’s changing and we’ll soon be paying the export price. I’m not looking forward to that.
Flaring is one of those unfortunate things that happen in an *underregulated* market. If burning hydrocarbons as fuel is a waste of good feedstock, flaring is downright criminal.
I don’t remember ever being late for anything, literally. If anything, I show up 5 or 10 minutes early. I agree that it’s extremely rude to force people to wait.
Yes, solar power is the coming thing. The S part of the STEM is already there, and getting better all the time. The T part, the same. The E part is already pretty good, but will be getting a lot better. Keep in mind that average insolation is something like a kilowatt per square meter, which allows for a lot of inefficiencies in capture, conversion, storage, and distribution. All of that is for the engineers to solve. I actually foresee a day when the distribution network is no longer needed because every building is self-sufficient.
I likewise never wear a watch, or anything else on my forearms or hands. If nothing else, working on cars and other machinery makes jewelry a really bad idea.
Nevertheless, like RBT, I’m very seldom late for anything, and if I am it’ll be because of circumstances beyond my control — traffic accident, having to wait for someone else before getting to the final destination, or such. Plan to be early, and that’ll take care of most minor delays. Regarding work appointments, punctuality is professionalism. (And I use that as judgment of others just as much as I use it to guide my own actions.) Regarding personal appointments, it’s just courtesy to my family or whoever to be on time when I meet them.
I am also an obsessive on-timer, usually arriving anywhere early. I really do not like people who are habitually late for everything. Well, I have to rephrase that; all the fems I’ve ever known, including in the present, are routinely late. They evidently find it physiologically impossible to ever be on time.
A tad chilly around here at the house last night, due to temps dropping through the low fotties and three broken windows from the storm the other morning. I’m on that detail this morning, plus the other usual Saturday chores and errands. Spoke with Mrs. OFD last night and she reports the temp out in lovely southern Kalifornia hit 106 yesterday and everything is brown and dried out. She’s flying back today and will spend tonight in Vermont and leaves again tomorrow for the Syracuse area of the Vampire State; if memory serves, her next gig in a couple of weeks is out in Minnesota, maybe the twin cities, I forget.
I’ve managed — unintentionally! really! I wouldn’t lie to you! — to piss off quite a few habitually late people with that “punctuality is professionalism” line, along with refusing to recap the first eight minutes of the meeting for their benefit. When I’m the one running a meeting, I always produce quite a good summary, so I tell the late-ass they can read it later. (I say “they” as a gender-neutral pronoun, but it should be “she”. Female middle-management parasites are grossly overrepresented in the habitually late category.)
I also start the meeting right on time (assuming people in the conference room before us don’t run over, and I’m not bashful about disrupting their meeting to kick them out), stick to the previously-distributed agenda, and end as soon as the topic of the meeting has been resolved, rather than just babble on to fill up the remaining scheduled time. As a consequence, busy people tend to come to my meetings or at least send someone, where they tend to ignore my managers’ meeting requests. Much to the annoyance of babbling, useless managers. (Some redundancy may be noted in “babbling, useless managers”, especially in government offices.)
@SteveF: Sounds right. When I run meetings, people are always astounded at how quickly they are over. Most people find it good, some, of course, don’t… I can’t stand meetings where the person in charge just lets things drift, people talk about irrelevant stuff, etc…
That’s why NG prices in Australia are set to skyrocket.
A friend of mine has done some work on a major LNG project that is getting started in Australia. They have the rights to a couple of very big and very remote leases offshore there. There will be an entire infrastructure build to extract, process, and export the hydrocarbons. Billion $+ project.
You mean you now have to settle their invoices within 122 days rather than 60 as before, or vice versa?
That means if I issue an invoice on Jan 1, they will probably pay it by July. Or September.
Just got an email from a client in Greece with a new four page double taxation form that they want us to fill out attesting that we do not have a office in Greece before they can pay their invoice. That invoice was issued last November. Yes, Greece still has a full and completely useless tax bureaucracy.
Verizon on the cell phone tower. They require a million dollar property liability policy
Why do you have to have insurance if the equipment is theirs? If their tower falls does your insurance have to pay?
Don’t forget about the most ethical company in the world giving themselves a 10% discount from the invoice amount, on account of their prompt payment. Never mind that no such discount was mentioned in the contract.
Why do you have to have insurance if the equipment is theirs? If their tower falls does your insurance have to pay?
That is a very good question. My insurance underwriter wants me to be named on their policy, as if that is going to happen!
The offer states “Each party will maintain comprehensive general liability and property liability insurance with liability limits of not less than $1,000,000 for injury to or death of one or more persons in any one occurrence and $500,000 for damage or destruction to property in any one occurrence.”
“Female middle-management parasites are grossly overrepresented in the habitually late category.”
Why would this be, one might ask, if one was totally naive and younger than, say, 18 or so…?
OFD sez: It’s because the silly cows are STILL yakking somewhere else, probably the just-previous “meeting,” and/or chatting it up with anyone else, especially other fembats and fembots, they meet along their way to the current “meeting.”
That is all.
That’s why NG prices in Australia are set to skyrocket. Local prices have been held low by lack of exports, but now that’s changing and we’ll soon be paying the export price.
Blame Japan and tell them to restart those 48 unaffected nuclear power plants that they have shutdown semi permanently.
I doubt that you will pay the export price which is around $12 to $16. People will get upset at that price. And, most of the export NG is stranded, right?
OFD sez: It’s because the silly cows are STILL yakking somewhere else, probably the just-previous “meeting,” and/or chatting it up with anyone else, especially other fembats and fembots, they meet along their way to the current “meeting.”
That’s called networking dino-OFD. The feeeemale way.
An article on how cops can legally steal your stuff.
One afternoon in August 2012, Mandrel Stuart was driving with his girlfriend into Washington, D.C., when a Fairfax County cop pulled him over on Interstate 66, ostensibly because the windows of his SUV were too dark. Lacking the device necessary to check whether the tinting of the windows exceeded the legal limit, Officer Kevin Palizzi instead cited Stuart for having a video running within his line of sight. While Palizzi was filling out the summons, another officer arrived with a drug-detecting dog. Claiming the dog alerted to the left front bumper and wheel of Stuart’s GMC Yukon, the cops searched the car and found $17,550 in cash, which they kept, assuming that it must be related to the illegal drug trade.
In case like that, with no support from the law or the courts, one must make do with alternatives. I would be inclined to get that cash back, one way or the other, and also to inflict the relevant punishment for armed robbery.
I hate The War on Some Drugs ™.
Closely related to the War on Some Terrorists.
“With a Little Help from Our Friends: Creating Community as We Grow Older”
http://www.amazon.com/With-Little-Help-Our-Friends/dp/0826519881/
Might be an interesting read. We put the FIL into a nursing home earlier this year and he is very unhappy. But, we cannot take care of him nor could his girlfriend when he lost the ability to walk and get in / out of bed.
My parents are in the middle 70s and showing some signs of advancing age. Mom falls now and Dad just fought off cancer for the seventh time (first was when he was 42 and running 8 businesses with almost 2,000 employees).
SteveF wrote:
“…stick to the previously-distributed agenda, and end as soon as the topic of the meeting has been resolved, rather than just babble on to fill up the remaining scheduled time.”
When I was working I said many times that meetings should be held in rooms without chairs to encourage the quick conclusion of meetings. I found that in most of the meetings in my last 10 years at work about 5% of the content was relevant to me, and I’d sometimes fall asleep during the boring bits. This did not endear me to the femocracy which typically ran the meetings.
My friend in the cell tower business for a major carrier, tells me Lynn’s situation is pretty much normal. Personally, I have never known a self-supporting tower (which most cell towers are) to fall, but I suspect somewhere, sometime, that has happened. Self-supporting is usually used for minimal height. If you want tall, guyed towers are the cheapest way to get high. I suspect if there have been felled self-supporting towers, they were pretty tall, but 200 to 250 feet is the usual for cell towers, and that is not tall compared to the 300 to 500 feet broadcasting needs.
It used to be somebody’s regulation that nothing but tower-related buildings could be within the falling radius of towers. But that went out the window somewhere along the line. I suspect that was the point where insurance started coming in. The guys who climb the towers should have their own insurance; IMO that is also incentive for them not to commit suicide. Those people are crazy anyway — if you have ever been around any of them.
What a company like Verizon pays for a tower varies widely. Farmers are likely to be the best deals for the cell company, because usually they are not aware of competitive rates. Whereas locating on a commercial building can cost a lot — never less than $1,000/mo.
I know of one specific instance where a guy and a couple in-laws, bought a 4 story office building with about 40 office units and a large anchor spot on ground level (occupied for a couple decades by a ‘private’ business bank) just in time for desertion and decay of the surrounding 2 strip malls, as the neighborhood turned much lower income and businesses left. But those owners were able to get a contract for cell phone antennas on the roof (in the early days), paying $13,000/mo. The owners sold that contract, taking a lump sum annuity-like payment. The office building has been essentially empty since I was briefly connected with it, and whoever bought that contract is now left holding the bag, as the cell phone company turned off that old equipment and relocated their new stuff to much cheaper sites.
The radio project had a studio in that building, but we left. Our chief tech was the design engineer that located the antennas on top of that building (way before there was a radio station in the picture). The anchor bank also moved elsewhere, so there ain’t much going on in there now, and we were so unsure the new building rental managers would let us stay (for $1/yr), that we jumped at the first offer to get out of the uncertainty the old place represented.
I do know that antenna towers has turned out to be a really marginally profitable business. Almost every tower you see (except cell phone towers) is now owned by one of 5 big companies that own and manage towers across the US — even radio and TV stations have mostly sold their towers and now rent from big tower operators (outsourcing don’t ‘cha know). The people we rent from, own over 4,000 towers nationally, and that is less than a fifth of all towers nationwide. Some towers have no customers on them at all. The tower companies do not remove old antennas, so what you see up there, may not even be active. I know of a half-dozen towers near our location that are totally without anyone actively on them. The tower chains who own them will not tear them down, however, as replacement cost is so high, and that somehow influences them to think that some day, somebody will want to be located on their tower. So they take their losses and use more profitable towers to offset them, which reduces their overall profit margins to “slim”.
Rents vary widely. We know what everyone pays on our tower, and even though the others are commercial enterprises and we are non-profit, we pay the most. The tower company rightly assumes that it would be non-trivial for us to move, so that is their leverage to sock it to us. We pay 8% more year over year. So if Verizon is the tenant, not getting yearly increases — that is a better deal for them than we have got as a renter.
Eventually, we cannot afford the increase. The station has been on for 5 years, and income is pretty steady — definitely not growing at 8% per year. In fact, few in the industry are getting those results, since radio is losing overall audience as surely as newspapers have been. If some station is doing 8% or better, they are doing it at the expense of someone else who is losing overall market share.
In the cell phone business, my colleague tells me that the current trend is for cell phone companies to buy land and operate their own towers, often joining in consortium with other cell phone companies for a joint owner/operator deal. Although they once shunned working with the other companies, they now realize that the only way to cut costs is for them to share towers.
Unless some new technology shows up on the horizon, your tower is going to be pretty useless if Verizon ever pulls out. And as their technology advances, that likelihood is ever-present. Three 300 ft towers are within a 5 mile radius of ours, sitting empty of any customers (we do do our homework). But I can tell you that none of those other towers will take less than $1k/mo.
But I can tell you that none of those other towers will take less than $1k/mo.
Is that to locate antennas on the tower? I am in the opposite boat, Verizon wants to lease 60 ft by 60 ft of land from me for the tower. And height of the tower will be 168 ft.
I am thinking about countering to their offer at $1,000/month with a four percent increase in the rent per year.
There is a tmobile / sprint tower about a mile west of me that they could also locate their antennas on. But their problem area is due south of me for two miles.
The tower chains who own them will not tear them down, however, as replacement cost is so high, and that somehow influences them to think that some day, somebody will want to be located on their tower.
If they are not paying their land rent then the tower will need to come down.
In the cell phone business, my colleague tells me that the current trend is for cell phone companies to buy land and operate their own towers, often joining in consortium with other cell phone companies for a joint owner/operator deal.
Around here they will need to buy five acres, otherwise the Land of Sugar can regulate their usage of the land. And regulate them they will, good and hard. They will need to run all kinds of engineering studies including highway traffic studies, etc. Good and hard regulation indeed. Unless, one owns five or more acres which according the state constitution requires that the city annex the land in order to regulate it.
“…annex the land in order to regulate it.”
That sez it all right there, about our current situation in this country. The Leviathan State will simply steal your property and then regulate the hell out of it while charging you for the privilege. And if you don’t pay, they’ll throw your ass in prison. Tell me again how this is any different from pirates, brigands, highwaymen or medieval robber barons and bridge trolls of mythology and fairy tales…maybe they’re not really fairy tales…
Me: But I can tell you that none of those other towers will take less than $1k/mo.
Lynn: Is that to locate antennas on the tower? I am in the opposite boat, Verizon wants to lease 60 ft by 60 ft of land from me for the tower. And height of the tower will be 168 ft.
That is monthly space rental on the tower for our antenna. We pay to get it up there and for any maintenance and upkeep. Tower company maintains the tower, tower lights, guy wires, and the building for our transmitter, including air-conditioning and heating.
Lynn: I am thinking about countering to their offer at $1,000/month with a four percent increase in the rent per year.
Sounds like a reasonable counter, but the insurance they want you to buy is definitely going to go up every year. You have a powerful reason to get a raise every year.
Also, my guess is that if/when they no longer want your location, that tower will be your demolition problem, so plan some funds for that. They will just walk away from it. That is what is happening with old antennas and equipment around here. Cell companies are just walking away from it. The old cell phone antennas and equipment remains at our tower site; same with the office building we just vacated — the equipment and antennas remain on the building, even though switched off at the first of the year. That is going to be a real PITA, because the building owners gave in-perpetuity ownership of the spot on the roof where the antennas sit. They get no rent from it, so they cannot take it back for non-payment. It is owned by an intermediary company, not the phone company. No one will use that tower arrangement ever again. I sure would not want to be in the building owners’ feet. It will be a real legal entanglement to unwind, as zero maintenance gets done on that structure and it becomes unsafe, but yet the building owner does not own what sits on top of his own property.
Me: The tower chains who own them will not tear them down, however, as replacement cost is so high, and that somehow influences them to think that some day, somebody will want to be located on their tower.
Lynn: If they are not paying their land rent then the tower will need to come down.
Well, it’s not quite like that around here, as most of the towers are on land the tower operators own — and I suspect it is essentially the same in Texas for older towers. Historically, towers were constructed by 3 main organizations, all on land they purchased and owned: radio/TV stations; the telephone company(s); and the FAA. Our tower was constructed in 1952 by Motorola to serve the Bell companies for microwave transmission relay links (what AT&T Long Lines called “K Stations”), and for Motorola’s own burgeoning two-way radio communications business (of which there is STILL one Motorola two-way transmitter and antenna still operating on our tower and in the transmitter shack (concrete trucking company). Motorola sold the tower in the 1980’s and it has changed hands a couple of times since then. The current owner/operator has had that tower for about 15 years now. They own the land all the way out to the furthest guy wire anchors. It is a helluva complex business with taxes owing to thousands of jurisdictions, zillions of different power companies to deal with, antenna lights and painting to maintain, in addition to keeping the guy wires structurally sound. That may be why the current practice is for cell companies to rent these days. Much simpler — they pay you, you pay the taxes and take care of any property issues. No lights or painting issues if the tower is under a certain height. I do not remember what that is, but I think yours would be exempt.
Our plot is less than 5 acres, but more than what they want from you. Never heard of those types of 5 acre regulations. In the places I have been, property can be divided up any old way, and the size only affects the tax rate, not how the land is regulated. However, there are massive hurdles and hoops to jump through when constructing a tower, most of them coming from the FAA. Our tower was constructed, then somebody built a private airport less than a mile down the road. The runway length is perpendicular to our tower (by that I mean planes do not take off and land in our direction), but the tower height still cannot be higher than the 290 feet it currently is. Our station is authorized for 350 feet. We just renegotiated the tower contract, but if we have to move, we will be looking for 350 feet, not just 290. The 2 vacant towers I noted are only 300 feet, so they were of no real interest to us, except to find out what we should be paying. Or what amount we should not be paying more than, I should say.