Monday, August 22, 2005
Good Recent Links on Fuel Supplies
Updated 3-26-06
A DOE sponsored paper gives, perhaps, the US Government's most lucid outline of the current energy environment. The paper, by Robert L. Hirsch outlines the peak oil situation, its possible permutations and proposes several scenarios for mitigation. Here is an abstract of the report and a link:
Title:
Peaking of Oil Production: Impacts, Mitigation, & Risk Management
Authors:
Hirsch, Robert L.Bezdek, RogetWendling, Robert
Keywords:
Energy Policy--United StatesPower Resources
Issue Date:
7-Apr-2005
Abstract:
The peaking of world oil production presents the U.S. and the world with an unprecedented risk management problem. As peaking is approached, liquid fuel prices and price volatility will increase dramatically, and, without timely mitigation, the economic, social, and political costs will be unprecedented. Viable mitigation options exist on both the supply and demand sides, but to have substantial impact, they must be initiated more than a decade in advance of peaking. This U.S. Department of Energy funded paper reports the problem of the peaking of world conventional oil production is unlike any yet faced by modern industrial society. The challenges and uncertainties need to be much better understood. Technologies exist to mitigate the problem. Timely, aggressive risk management will be essential.
The following link will take you to a site where you can download a copy of the report. The report itself is a 91 page pdf file. Click Here for Link
You can find a good review of the Hirsch Report here(click for link)
And you can find a 12 page article by Mr. Hirsch summarizing the larger report here(click for link)
New Supplies potential off the continental shelf can be found here.
Finally there is public movement on the energy issue. Peter Maass article in the New York times magazine has put the oil situation clearly in the cross hairs of American public opinion. His article is found here.
For contrast, in May of 2004 Jacqueline Doherty published an article in Barrons in which she predicted that oil would rise to $28 dollars per barrel by 2009. Very interesting to see the differing viewpoints and the current reality. Her article is linked here.
None of these articles really touch directly on the importance of conservation as a source of fuel.
Sunday, August 14, 2005
Energy Conservation As A Source of Fuel
The following is an important but little understood principal of energy conservation. I learned about this twenty five years ago while working for a firm that developed energy conservation programs during the OPEC oil embargo of the 1970's. My role there, at that time, was developing and illustrating educational materials tailored to various groups (homeowners, building owners and managers, schools, etc.).
The term “conservation” sometimes conjures up images of inconvenience and discomfort. In truth, however, this has not been the reality. The fact of the matter is that we have steadily improved efficiency and conservation over the last three decades since the 1974 energy crisis to a point where most homes, industries and automobiles operate on about half the fuel that was required before the embargo. At the same time performance, convenience and quality have improved tremendously.
A source of fuel: An additional benefit of conservation is that it is also one of our nation's best and most plentiful sources of fuel. That is because every gallon of fuel, or ton of coal that is not burned today is a gallon, or ton, that we can use tomorrow. The principal is true for coal, gas, uranium and virtually all supplies of energy. But there is more. A gallon, or ton, of fuel saved today through increased efficiency is actually the equivalent of two or more gallons, or tons for use in the future. The reason for is that saving energy is like saving money; it earns “interest”.
Most people understand the principals of compounding interest and know that, over a certain period of time, depending on the interest rate, a given amount of money invested in an interest bearing account will double in value. The time required for a given investment to double in value is called the doubling period. For an interest rate of 8 per cent the doubling period is just under 10 years. If you put $3000 in a savings account with 7.8 percent compounding interest you will have $6000 in 20 years, $12,000 in 30 years, $24,000 in 40 years, $48,000 in 50 years, $96,000 in 60 years, and so on.
What many people do not recognize, however, is that the same principals apply to energy supplies, only in reverse. With fuels, growth takes place in consumption rather than in accumulation. As demand grows, the amount of energy consumed will double every few years just as value will double in an investment. For example, if we use a billion barrels of oil in the year 2000 and our consumption of oil is growing at a rate of about 7 percent, we will need 2 billion barrels of oil in the year 2010, 4 billion barrels of oil in the year 2020, 8 billion barrels of oil in the year 2020, 16 billion barrels of oil in 2030, and so forth.
Fortunately the United States’ growth rate, in terms if fuel consumption is, while variable, typically about one third of the above rate. But even at the United States’ actual rate of growth in consumption, we will have used as much fuel in the last 30 years as we have used in the previous 150 years. In every doubling period we use as much total fuel as in all previous history since the fuel began to be used. Before the energy embargo in 1975 the United States average annual rate of growth in energy consumption was even greater than it is now and had averaged about 3 percent since the beginning of the industrial revolution. At an average growth rate of 3 percent, total volume of fuel used has doubled about every 24 years. Since the mid 1970s the growth rate has dropped to about 1.5 percent. 1.5 percent is also the US Government’s projected rate of growth for the next 20 years and, at that rate, we will again double the amount of fuel we have used by the year 2050. In other words we will use as much fuel in the next 50 years as we have used since the Industrial revolution took hold in America.
One could accurately say that we have fuel resources equal to all the fuel that our country, or indeed the world, has used throughout history, and that sounds great. In fact Dick Cheney used that quote in the recent flap over increasing production. However, the flip side of that equation is that we will completely use up all of those resources in the next 30 to 50 years, or less, if we maintain historic rates of growth.
So, in summary, we have more than doubled our future energy supplies through conservation over the last 30 years. Actual amounts of fuel supplies have not increased, but because we have cut our rate of growth from 3 percent to 1.5 percent we have doubled the amount of time it will take to use the remaining supplies that we do have.
This is the bounty of conservation. By cutting the rate of growth we radically increase the potential of our remaining fixed resources.
Conservation has, in fact, come to be seen as a commodity over the past few decades. Many utilities have instituted programs to educate customers in conservation. Some programs are as simple as giving away fluorescent lights and insulation to home owners. Other programs are more ambitious and include energy audits and low interest loans for efficient appliances and air conditioning systems. There is more to this trend than simple public relations. Some utilities are even buying excess electricity from customers who don’t use it; customers who have conserved are being paid not to use excess energy.
This “unused” electricity is then sold elsewhere at a profit. The economy of conservation is such that it has become more profitable in some areas for utilities to push conservation rather than consumption. A primary reason for this is that it is very expensive to bring new generating plants online. As long as the utilities have excess capacity they can continue to sell electricity profitably without huge capital investments for new plants. It is much more profitable to sell electricity from existing facilities than it is to build new facilities and sell the power for the same price. When demand reaches capacity and the utilities are required to construct expensive new plants, or dams, or nuclear reactors, then rates will go up to support profits.
The questions looming ahead are, "when will excess capacity be used up"? "Just how much time do we have left before we run out of non renewable fuel sources"? Also, "what will the end game look like"? "What will happen as our fossil fuels begin to run short; as the raw material for plastics and synthetics begins to run short"? "Will the increase in atmospheric gasses that result from burning all these fossil fuels (as much in the next 50 years as in the past 150 years) preclude us from using fossil fuels"? We must also remember that so much of the consumer goods we rely on, from nylon to asphalt, are made from the byproducts of petroleum production.
The answers are not simple. As we get closer to the end of easy supplies, efficiencies and conservation will increase and we will eventually go into negative growth, thus further extending the range of remaining supplies.
We must also be careful to avoid false economy. The use of electricity for automotive power is currently a false economy. Hydroelectric generation is another. Nuclear power generation is currently a false economy. These economies are false because they require more energy to produce than they deliver to the end user, or they require heavy subsidy or they result in costly environmental problems. New technology may mitigate these false economies somewhat but we are a long way from seeing the positive benefits of the new technology as the rubber hits the road. Conservation on the other hand, will result in huge fuel supplies in the future and not only is it a true economy, it is almost free.
Electricity is not a good portable power source. Batteries that are capable of powering a car are very heavy and take a long time to refill. They are also short lived and expensive to replace. In addition, the use of electricity for cars is highly inefficient. When fuel is burned to make electricity only about a third of the original energy of the fuel actually makes it through the car's engine to the road. This is due to the losses inherent in the generation process and to “line losses” wherein energy is lost to heat as it travels great distances over transmission lines. Then there are additional losses as the electricity stored in batteries dissipates with time. About five percent of the electricity stored in a battery just disappears for each day that it goes unused. Far more of the energy released in the burning of fuel in an internal combustion engine goes to propulsion than does the energy released from the burning of a fuel at a remote generating plant.
Hybrids such as the Toyota Prius are far more efficient than any electric charge-and-go cars. Hybrids also have fewer emissions than the large coal burning power plants that provide most of the power for electric cars. The hybrids have a small, efficient gas engine that provides the cruising power. There is also a small bank of batteries that are charged by a combination of an electric motor and a generator that is attached to the engine. The batteries in turn provide an extra boost of acceleration through the onboard electric motor/generator. When the car is coasting and braking the motor reverts to a generator and charges the batteries with energy that would otherwise be wasted.
Other emerging technologies include fuel cells and the sterling engine. Fuel cells use an electro-chemical process to extract hydrogen from water so that the hydrogen can be burned as a fuel. The sterling engine uses an external heat source to produce mechanical energy. The heat from burning fuel or other energy sources, such as solar, is applied to the outside of one portion of the engine while another portion is simultaneously cooled with air or water. Internal gasses circulate between the hot and cool portions of the engine and either push a piston or turn a turbine inside the engine. The sterling engine is capable of operating on solar energy (or geothermal or other relatively low-heat power sources). Unfortunately these low heat energy sources do not work well on a mobile platform such as a car but they are quite readily available at fixed points on the ground and may eventually be used as a local generator for charging batteries to power electric vehicles as well as in homes and businesses.
Hydroelectric power has cost to benefit problems that cannot be overcome without heavy subsidization. Many of the Hydroelectric dams produced in the twentieth century were built as much for economic development as for energy production and do not produce energy in sufficient concentrations to offset the economic and environmental costs. As productive land becomes more and more scarce, the cost of forever taking tens of thousands of acres of land out of production by flooding them to generate electricity is increasingly difficult to justify.
New technologies and small scale technologies appropriate to individual tasks will become increasingly important in the future. There are exciting new techniques for coaxing much more oil out of existing, and as yet untapped, supplies. New drilling techniques allow us to extract subterranean oil supplies with less consequence to the environment. However, one source of energy, conservation, is by far our largest, best and most economical supply of fuel for the future.
The term “conservation” sometimes conjures up images of inconvenience and discomfort. In truth, however, this has not been the reality. The fact of the matter is that we have steadily improved efficiency and conservation over the last three decades since the 1974 energy crisis to a point where most homes, industries and automobiles operate on about half the fuel that was required before the embargo. At the same time performance, convenience and quality have improved tremendously.
A source of fuel: An additional benefit of conservation is that it is also one of our nation's best and most plentiful sources of fuel. That is because every gallon of fuel, or ton of coal that is not burned today is a gallon, or ton, that we can use tomorrow. The principal is true for coal, gas, uranium and virtually all supplies of energy. But there is more. A gallon, or ton, of fuel saved today through increased efficiency is actually the equivalent of two or more gallons, or tons for use in the future. The reason for is that saving energy is like saving money; it earns “interest”.
Most people understand the principals of compounding interest and know that, over a certain period of time, depending on the interest rate, a given amount of money invested in an interest bearing account will double in value. The time required for a given investment to double in value is called the doubling period. For an interest rate of 8 per cent the doubling period is just under 10 years. If you put $3000 in a savings account with 7.8 percent compounding interest you will have $6000 in 20 years, $12,000 in 30 years, $24,000 in 40 years, $48,000 in 50 years, $96,000 in 60 years, and so on.
What many people do not recognize, however, is that the same principals apply to energy supplies, only in reverse. With fuels, growth takes place in consumption rather than in accumulation. As demand grows, the amount of energy consumed will double every few years just as value will double in an investment. For example, if we use a billion barrels of oil in the year 2000 and our consumption of oil is growing at a rate of about 7 percent, we will need 2 billion barrels of oil in the year 2010, 4 billion barrels of oil in the year 2020, 8 billion barrels of oil in the year 2020, 16 billion barrels of oil in 2030, and so forth.
Fortunately the United States’ growth rate, in terms if fuel consumption is, while variable, typically about one third of the above rate. But even at the United States’ actual rate of growth in consumption, we will have used as much fuel in the last 30 years as we have used in the previous 150 years. In every doubling period we use as much total fuel as in all previous history since the fuel began to be used. Before the energy embargo in 1975 the United States average annual rate of growth in energy consumption was even greater than it is now and had averaged about 3 percent since the beginning of the industrial revolution. At an average growth rate of 3 percent, total volume of fuel used has doubled about every 24 years. Since the mid 1970s the growth rate has dropped to about 1.5 percent. 1.5 percent is also the US Government’s projected rate of growth for the next 20 years and, at that rate, we will again double the amount of fuel we have used by the year 2050. In other words we will use as much fuel in the next 50 years as we have used since the Industrial revolution took hold in America.
One could accurately say that we have fuel resources equal to all the fuel that our country, or indeed the world, has used throughout history, and that sounds great. In fact Dick Cheney used that quote in the recent flap over increasing production. However, the flip side of that equation is that we will completely use up all of those resources in the next 30 to 50 years, or less, if we maintain historic rates of growth.
So, in summary, we have more than doubled our future energy supplies through conservation over the last 30 years. Actual amounts of fuel supplies have not increased, but because we have cut our rate of growth from 3 percent to 1.5 percent we have doubled the amount of time it will take to use the remaining supplies that we do have.
This is the bounty of conservation. By cutting the rate of growth we radically increase the potential of our remaining fixed resources.
Conservation has, in fact, come to be seen as a commodity over the past few decades. Many utilities have instituted programs to educate customers in conservation. Some programs are as simple as giving away fluorescent lights and insulation to home owners. Other programs are more ambitious and include energy audits and low interest loans for efficient appliances and air conditioning systems. There is more to this trend than simple public relations. Some utilities are even buying excess electricity from customers who don’t use it; customers who have conserved are being paid not to use excess energy.
This “unused” electricity is then sold elsewhere at a profit. The economy of conservation is such that it has become more profitable in some areas for utilities to push conservation rather than consumption. A primary reason for this is that it is very expensive to bring new generating plants online. As long as the utilities have excess capacity they can continue to sell electricity profitably without huge capital investments for new plants. It is much more profitable to sell electricity from existing facilities than it is to build new facilities and sell the power for the same price. When demand reaches capacity and the utilities are required to construct expensive new plants, or dams, or nuclear reactors, then rates will go up to support profits.
The questions looming ahead are, "when will excess capacity be used up"? "Just how much time do we have left before we run out of non renewable fuel sources"? Also, "what will the end game look like"? "What will happen as our fossil fuels begin to run short; as the raw material for plastics and synthetics begins to run short"? "Will the increase in atmospheric gasses that result from burning all these fossil fuels (as much in the next 50 years as in the past 150 years) preclude us from using fossil fuels"? We must also remember that so much of the consumer goods we rely on, from nylon to asphalt, are made from the byproducts of petroleum production.
The answers are not simple. As we get closer to the end of easy supplies, efficiencies and conservation will increase and we will eventually go into negative growth, thus further extending the range of remaining supplies.
We must also be careful to avoid false economy. The use of electricity for automotive power is currently a false economy. Hydroelectric generation is another. Nuclear power generation is currently a false economy. These economies are false because they require more energy to produce than they deliver to the end user, or they require heavy subsidy or they result in costly environmental problems. New technology may mitigate these false economies somewhat but we are a long way from seeing the positive benefits of the new technology as the rubber hits the road. Conservation on the other hand, will result in huge fuel supplies in the future and not only is it a true economy, it is almost free.
Electricity is not a good portable power source. Batteries that are capable of powering a car are very heavy and take a long time to refill. They are also short lived and expensive to replace. In addition, the use of electricity for cars is highly inefficient. When fuel is burned to make electricity only about a third of the original energy of the fuel actually makes it through the car's engine to the road. This is due to the losses inherent in the generation process and to “line losses” wherein energy is lost to heat as it travels great distances over transmission lines. Then there are additional losses as the electricity stored in batteries dissipates with time. About five percent of the electricity stored in a battery just disappears for each day that it goes unused. Far more of the energy released in the burning of fuel in an internal combustion engine goes to propulsion than does the energy released from the burning of a fuel at a remote generating plant.
Hybrids such as the Toyota Prius are far more efficient than any electric charge-and-go cars. Hybrids also have fewer emissions than the large coal burning power plants that provide most of the power for electric cars. The hybrids have a small, efficient gas engine that provides the cruising power. There is also a small bank of batteries that are charged by a combination of an electric motor and a generator that is attached to the engine. The batteries in turn provide an extra boost of acceleration through the onboard electric motor/generator. When the car is coasting and braking the motor reverts to a generator and charges the batteries with energy that would otherwise be wasted.
Other emerging technologies include fuel cells and the sterling engine. Fuel cells use an electro-chemical process to extract hydrogen from water so that the hydrogen can be burned as a fuel. The sterling engine uses an external heat source to produce mechanical energy. The heat from burning fuel or other energy sources, such as solar, is applied to the outside of one portion of the engine while another portion is simultaneously cooled with air or water. Internal gasses circulate between the hot and cool portions of the engine and either push a piston or turn a turbine inside the engine. The sterling engine is capable of operating on solar energy (or geothermal or other relatively low-heat power sources). Unfortunately these low heat energy sources do not work well on a mobile platform such as a car but they are quite readily available at fixed points on the ground and may eventually be used as a local generator for charging batteries to power electric vehicles as well as in homes and businesses.
Hydroelectric power has cost to benefit problems that cannot be overcome without heavy subsidization. Many of the Hydroelectric dams produced in the twentieth century were built as much for economic development as for energy production and do not produce energy in sufficient concentrations to offset the economic and environmental costs. As productive land becomes more and more scarce, the cost of forever taking tens of thousands of acres of land out of production by flooding them to generate electricity is increasingly difficult to justify.
New technologies and small scale technologies appropriate to individual tasks will become increasingly important in the future. There are exciting new techniques for coaxing much more oil out of existing, and as yet untapped, supplies. New drilling techniques allow us to extract subterranean oil supplies with less consequence to the environment. However, one source of energy, conservation, is by far our largest, best and most economical supply of fuel for the future.
Subscribe to:
Posts (Atom)
Posts
