Sunday, March 23, 2014

What you need to know about Term Life Insurance

Insurance policy law

Before buying any insurance policy, you should know who regulates insurance companies, what law and protection do courts, states and federal government provide to both the insurer and the insured. To sum it up, insurance regulatory law is primarily enforced through regulations, rules and directives by state insurance departments as authorized and directed by statutory law enacted by the state legislatures. However, federal law, court decisions and administrative adjudications also play an important role.

Term life insurance

Many insurance companies in United States provide coverage at a fixed rate of payments for a limited period of time. This coverage is known as Term Life Insurance. It should be noted that Term Life Insurance coverage expires after a specified period agreed upon by the insurer and insured.

What you need to know about Term Life Insurance

In United States, Term Life Insurance is the least expensive way to purchase a substantial death benefit. This is because Term life insurance premiums are generally lower than those for permanent (whole) life insurance.

A large number of Americans buy Term life insurance because it covers specific needs such as mortgages or family income needs for children. Term life insurance can serve as mortgage protection for your family due to premature death. Under Term Life insurance, death of the insured has to occur within the coverage period. God forbid, say you have cancer and your doctor informed you that you would die within five years. In such situation, Term Life Insurance is the best insurance policy to buy.
However, there are terms and conditions to learn and agree to before buying Term life insurance policies. For example, you should be aware that Term Life Insurance does not build cash value. Also, Term Life Insurance benefit is paid only if you die during the term of the policy coverage. If death occurs, the beneficiary collects the death benefit of the policy tax-free.

It is also important to note that premium rates for renewals of term life insurance policies will normally increase at the end of the guaranteed policy period. In addition, Term Life Insurance policies require that you furnish evidence of insurability at renewal to qualify for lower rates. Further more, term life insurance policies carry a conversion privilege that allow you to convert your term life insurance coverage to permanent life insurance without a medical examination. However, check the conversion privileges of the policy before you make your purchase. 

Monday, March 3, 2014

Can We Call Biomass A Renewable Source Of Energy

Biomass, a renewable energy source derived from organic matter such as wood, crop waste, or garbage, makes up 50% of all U.S. renewable energy. Ninety percent of all existing biomass power plants use wood residue and there are currently 115 power plants in development that will burn biomass to generate electricity. But just how renewable is biomass energy?

There are several ways to produce energy from biomass including burning biomass to generate heat or run steam turbines that produce electricity, turning feedstocks into liquid biofuels, and harvesting gas from landfills or anaerobic digesters. Biomass can consist of sawdust from lumbermills, logging byproducts, construction or organic municipal waste, energy crops (switchgrass), crop residue, and even chicken litter, but most biomass comes from bark, sawdust and woody residue from the logging and paper industries.  Since the rapid expansion of biomass energy today relies largely on wood from forests, we’ll focus here on energy produced by the combustion of biomass from forest wood and woody residue.

The U.S. Forest Service states that utilizing woody biomass is an “opportunity we cannot afford to waste.”  The Forest Service says thinning out small-diameter or dead trees from overcrowded forests, and harvesting the byproducts of forest management such as limbs, treetops, needles, leaves, etc. improves the health of the trees that remain in the forest and helps reduce the incidence of wildfires. Biomass creates new jobs and supports local economies by providing new markets for farmers and forest owners. It can also lessen our dependence on fossil fuels, and under certain conditions, can reduce greenhouse gas emissions.

Biomass is considered a renewable energy source because the carbon in biomass is regarded as part of the natural carbon cycle: trees take in carbon dioxide from the atmosphere and convert it into biomass and when they die, it is released back into the atmosphere. Whether trees are burned or whether they decompose naturally, they release the same amount of carbon dioxide into the atmosphere. The idea is that if trees harvested as biomass are replanted as fast as the wood is burned, new trees take up the carbon produced by the combustion, the carbon cycle theoretically remains in balance, and no extra carbon is added to the atmospheric balance sheet—so biomass is considered “carbon neutral.”  Since nothing offsets the CO2 that fossil fuel burning produces, replacing fossil fuels with biomass supposedly results in reduced carbon emissions.

In fact, the reality is a lot more complicated. Whether or not biomass is truly carbon neutral depends on what type of biomass is used, the combustion technology, which fossil fuel is being replaced, and what forest management techniques are employed where the biomass is harvested. The combustion of both fossil fuels and biomass produce carbon dioxide. When short-term biomass is burned, such as annual crops, the amount of carbon generated can be taken up quickly by the growing of new plants. But when the biomass comes from wood and trees, not only can the regrowing and thus the recapture of carbon take years or decades, but also, the carbon equation must take into consideration carbon the trees would have naturally stored if left untouched. A group of prominent scientists wrote to Congress in May 2010 explaining that the notion that all biomass results in a 100% reduction of carbon emissions is wrong. Biomass can reduce carbon dioxide if fast growing crops are grown on otherwise unproductive land; in this case, the regrowth of the plants offsets the carbon produced by the combustion of the crops. But cutting or clearing forests for energy, either to burn trees or to plant energy crops, releases carbon into the atmosphere that would have been sequestered if the trees had remained untouched, in addition to producing carbon in the combustion process, resulting in a net increase of CO2.

Nevertheless, all types of biomass energy are currently considered renewable and carbon neutral and thus qualify for many tax credits, subsidies, and incentives. These include Renewable Energy Credits wherein every megawatt-hour of electricity generated by biomass earns a credit that can be sold to utilities required to purchase a certain amount of renewable energy. The Energy Production Tax Credit pays biomass energy producers 1.1 cent per kilowatt-hour for 5 years. The Investment Tax Credit created under the stimulus reimburses 30% of biomass plant development if it is started by 2011.  And biomass is exempt from carbon allowances and eligible for subsidies from the U.S. Department of Agriculture.
Photo credit: rebuildingdemocracy
As a result of these incentives, the biomass industry is expanding rapidly. Most of the new biomass electricity generating plants being developed will burn wood. And since there isn’t enough logging residue to meet the increased demand for biomass, some fear that more standing trees will be chopped and more forests clear-cut. The new biomass plants will produce 38 MW of electricity on average, but over 30 plants are being built in the 50 to 110 MW range.

 According to the Partnership for Policy Integrity (PFPI), a 50-MW plant burns 2,550 lb. of green wood each minute. PFPI calculates that at this rate the 115 new biomass plants being built over the next 3 years will burn around 55 million tons of wood—that’s equivalent to 650,000 clear-cut acres of forest per year by 2014.  This staggering figure doesn’t include additional wood that will be needed for co-firing in coal plants where wood is burned with coal to meet state renewable energy mandates (resulting in additional carbon emissions), pellet production, and liquid biofuels. While admittedly most forests will not actually be clear-cut for biomass energy, the numbers make clear the amount of pressure that will be brought to bear on our forests.

How will this increase in biomass burning impact climate change, our health, and the environment? Regardless of their size, biomass-burning power plants actually produce more global warming CO2 than fossil fuel plants: 150% the CO2 of coal, and 300 to 400% the CO2 of natural gas, per unit of energy produced. In addition, burning wood biomass emits as much if not more air pollution than burning fossil fuels (including coal), i.e. particulate matter, nitrogen oxides, carbon monoxide, sulfur dioxide, lead, mercury, and other hazardous air pollutants, which can cause cancer or reproductive effects. The air pollution from biomass facilities, which the American Heart Association and the American Lung Association have called a danger to public health, produces respiratory illnesses, heart disease, cancer, and developmental delays in children.
Heavy machinery compacts soil. Photo credit: David Stanley
Harvesting limbs, leaves and plant parts, which normally recycle nutrients back into the soil as they decay, may diminish soil fertility and hasten erosion. Heavy machinery used for Iogging compacts soil and increases runoff, which can affect water quality. Removing woody residue and plant material from the forest will also impact wildlife habitats on the forest floor. In addition, the effort to produce large amounts of biomass quickly may encourage the planting of short rotation woody crops, some of which are invasive species (giant reed, castor oil bush); this could cause serious environmental damage to native ecosystems.

The Natural Resources Defense Council warns against using our forests for fuel: “You can plant new trees, but forests aren’t ‘renewable’. Natural forests, with their complex ecosystems, cannot be regrown like a crop of beans or lettuce… tree plantations will never provide the clean water, storm buffers, wildlife habitat, and other ecosystem services that natural forests do.”
Managed tree plantation. Photo credit: John A. Kelley
In March, 2011, the U.S. Environmental Protection Agency (EPA) gave biomass-burning facilities a 3-year exemption from having to obtain permits and control CO2 emissions as the agency studies the environmental impacts of biomass. Just recently, several environmental groups filed suit against the EPA rule, saying that the 3-year pass will cause immediate environmental harm. PFPI contends that the exemption will also result in a rush to build biomass plants, which could then be grandfathered in and remain exempt from carbon accounting when guidelines are later established.

The woody biomass industry needs to be regulated so that increased harvesting will not damage our forests and the ecosystem services they provide. The Union of Concerned Scientists advocates a balanced approach that includes creating new Best Management Practices for forest management designed to address increased biomass harvesting levels, third-party certifications to verify that biomass harvests remain sustainable, and forest management plans written by professionally accredited foresters. In addition, where soils are affected, nutrients need to be replenished; some woody material (30%) should be left in forests to provide habitat for wildlife and protect biodiversity; and old growth forests and key habitats must be protected.

Most importantly, state, federal, and international regulations need to clearly distinguish between the types of biomass energy that are beneficial and those that are detrimental. Treating all biomass, regardless of its source, as carbon neutral, could lead to increased greenhouse gas emissions at home and around the world. In their letter to Congress, the scientists said, the “globally improper accounting of bioenergy could lead to large-scale clearing of the world’s forests… any legal measure to reduce greenhouse gas emissions must include a system to differentiate emissions from bioenergy based on the source of the biomass.”