Hydrogen Made by Methanol Electrolysis Process Saves Energy

Water electrolysis for large scale hydrogen production is unattractive because of its high electricity consumption. But hydrogen produced by electrolysis of methanol as proposed by Prof. Shen, from Advanced Energy Materials Research laboratory of Sun Yat-Sen University, Guangzhou, China uses only 1/3 electricity consumption of water electrolysis.

The principle of the electrolysis of methanol is as follows. Methanol is oxidized via dehydration at the anode, the resulting H+ ions diffusing through a proton exchange membrane (PEM) to the cathode chamber where they are reduced to hydrogen gas.

A promising advantage is that the standard potential is only 0.02 V vs NHE for methanol oxidation compared to 1.23 V for water electrolysis. Additionally the hydrogen generated comes from the methanol as well as from the water, the overall reaction being CH3OH + H2O = 3H2 + CO2.

This process offers potential for lower distributed hydrogen production costs and reducing the infrastructure required for hydrogen distribution. It is too early to assign any costs to the process. Obviously, the cost of the methanol would deduct from other savings.

Source: Fuel Cell Works

Energy Outlook, Feb. 6, 2006

EIA Short-Term Energy Outlook
February 6, Release (Next Update: March 6, 2007)

Highlights

• The unseasonably warm temperatures in the United States and throughout most of the northern hemisphere through early January reduced the demand for heating fuels, leading to an easing of petroleum and natural gas prices. Between mid-December 2006 and January 18, 2007, the spot price of West Texas Intermediate (WTI) crude oil fell by about $12 per barrel to a low of $50.51 per barrel. The Henry Hub natural gas spot price fell from $8.67 per thousand cubic feet (mcf) on December 1 to a low of $5.56 per mcf on January 2. The turn to colder weather in the second half of January contributed to increasing crude oil and natural gas prices. In February 2007 the WTI crude oil price is expected to average $56.00 per barrel, and the Henry Hub natural gas price is projected to average $7.35 per mcf.

• We have lowered our price projection for WTI crude oil from our last Outlook. WTI crude oil, which averaged $66.00 per barrel in 2006, is projected to average about $59.50 per barrel in 2007 and $62.50 per barrel in 2008. The Henry Hub natural gas price, which averaged $6.90 per mcf in 2006, is projected to average $7.10 mcf in 2007 and $7.60 in 2008.
• Total U.S. petroleum product consumption is projected to increase in 2007 and 2008 by 1.4 percent and 1.5 percent, respectively. Lower projected prices in 2007, combined with projections for moderate economic growth and the assumption of normal weather, are the primary reasons for increased growth in consumption.
• Projections of U.S. heating fuel expenditures for the 2006-07 winter season have declined over the last two Outlooks, reflecting relatively warm winter weather from November through the middle of January. Average household heating fuel expenditures are projected to be $862 this winter compared to $948 last winter. ... more

http://www.eia.doe.gov/steo

White House Claims US Doing Better Than EU on Reducing GHG

White House: US Cuts Emissions Better than Europe
Planet Ark, Reuters News Service, Feb. 8, 2006

The White House said on Wednesday the United States had done better at reducing carbon emissions than Europe, where US President George W. Bush's stance on global warming has been sharply criticized. ...

Figures from the International Energy Agency indicated that from 2000 to 2004, US carbon dioxide emissions from fossil fuel combustion grew by 1.7 percent, while in the European Union such emissions grew by 5 percent. ...

In response, US officials played down the country's contribution to climate change, although the United States is responsible for one-quarter of the world's carbon dioxide emissions and uses one-quarter of the world's crude oil.

Senators Blast Bodeman for Failing to Implement Loan Guarantees

Senators Criticize Energy Secretary: Loan Guarantee Program Lagging
Michael Coleman, Albuquerque Journal, N.M., Feb 8

Sens. Jeff Bingaman and Pete Domenici gave U.S. Energy Secretary Samuel Bodman a bipartisan blasting at a Senate hearing Wednesday for failing to implement loan guarantees to stimulate clean energy technologies

Bingaman, Democratic chairman of the Senate Energy and Natural Resources Committee, and Domenici, the panel's top Republican, said the Energy Policy Act of 2005 provided for federal loan guarantees, but the DOE hasn't put them to use.

Bodman said DOE has been hamstrung by tight budgets, and that it doesn't want to "rush" to get the program in place. ...

This has been one of my biggest complaints about the DOE program, it is really holding up development of cellulosic ethanol by not building demonstration plants. I am glad that someone in power is trying to do something about it. Finding the money to do this is a simple matter of placing less emphasis on hydrogen and nuclear and more on clean energy technologies. They don't seem to be willing to take risks. One of the main reasons for government assistance is to provide aid when normal financing is unavailable because of risk. If we have to wait until the processes are commercial what is the point. Just look at some of my recent posts on cellulosic ethanol to see that companies are starting to build plants on their own (or investors) bucks. The better technologies are probably being used by the companies that are building, while the companies with less developed technologies are waiting for government support.

Study Says Yucca Mountain Too Costly

Nevada Study Shows Yucca Mountain Project Will Cost Much More Than Storing Nuclear Waste at Existing Reactor Sites
CARSON CITY, Nev., Feb 08, 2007 -- BUSINESS WIRE

A study released this week by the state of Nevada contradicts cost estimates from the U.S. Department of Energy and suggests the proposed Yucca Mountain nuclear waste repository would actually cost billions more than storing the waste at existing nuclear reactor sites.

The analysis shows that (using that same 3 percent discount rate) it would cost $13.3 billion today to pay for the costs of dry storage at all 100 U.S. reactor sites - "for all perpetuity." Conversely, based on the same conditions, he found that it would cost $38.3 billion to build the Yucca repository by DOE's target date of 2025. The additional cost to store spent fuel until the repository is completed in 2025 is estimated at $5.8 billion.

Economists Favor Rasing Taxes On Fossil Fuels

Is It Time for a New Tax on Energy?
By Phil Izzo, Wall Street Journal, February 9, 2007

Economists Say Government Should Foster Alternatives – But Not How Bush Proposes

The government should encourage development of alternatives to fossil fuels, economists said in a WSJ.com survey. But most say the best way to do that isn't in President Bush's energy proposals: a new tax on fossil fuels.

Forty of 47 economists who answered the question said the government should help champion alternative fuels. Economists generally are in favor of free-market solutions, but there are times when you need to intervene," said David Wyss at Standard & Poor's Corp. "We're already in the danger zone" because of the outlook for oil supplies and concerns about climate change, he said.

A majority of the economists said a tax on fossil fuels would be the most economically sound way to encourage alternatives. ...

This may be the popular view of economists, but would the public like it. This approach is used in Brazil and parts of Europe. What do you think?

UK Wind & Gas Project: First of Kind

On Feb. 8 Eclipse Energy UK plc (‘Eclipse’) announced that it has been granted consent to construct and operate a unique dual energy scheme, the Ormonde offshore wind farm and to generate and export electricity from the adjacent Ormonde Gas Fields development by the UK Government. This completes the series of principal permissions necessary to construct the world’s first co-development of offshore gas and wind energy, in the East Irish Sea offshore from Lancaster.

When constructed Ormonde is expected to have the ability to provide up to 200MW of electricity from its gas turbines fueled by two natural gas fields and dedicated offshore wind farm of 30 turbines. The Ormonde project will be able to supply the equivalent of three-quarters of Cumbria’s domestic load generating enough electricity to power over 155,000 homes, the equivalent of which 71,000 would be powered by renewable energy, it will also save up to 286,000 tons of CO2 per year. The project anticipates first energy in 2009.

Ormonde Project Facts
	Wind	Natural Gas
Revenue Split	80%	20%
Installed Capacity	108MW	93MW
Generated Electricity	59%	41%

The Ormonde Project is a global first, integrating gas-fired power generation from end-of-life or ‘fallow’ gas fields utilized as a commercial catalyst in order to develop and generate renewable energy from an offshore wind power generation scheme.

Energy Minister Lord Truscott said:

"We are now starting to see a real flow of approvals for energy projects in UK waters. The London Array and Thanet schemes in the Thames Estuary went through in December and the good progress continues in 2007."

Commenting on the license award, Ian Hatton, Managing Director of Eclipse said,

"Eclipse is delighted to have gained consent for the world's 1st hybrid energy generation facility.

"We have combined both North Sea oil and gas experience and business models to provide a commercial catalyst to enable us to harness the energy from offshore natural gas fields and wind power, this is a global first.

"Over the next few years the UK's natural gas reserves will become depleted and we will become increasingly dependent upon imported energy. It is therefore vital that we explore the opportunities for producing energy from renewable sources and that we maximize recovery of the nation's indigenous energy.

"We believe that wind power can play a key role by producing electricity from a clean, free, abundant and inexhaustible resource. We expect Ormonde to be the first of a series of similar projects where offshore wind energy is developed using the hybrid concept. Our project is dominated by wind power but will also generate electricity from two small gas fields, Ormonde North and Ormonde South.

Eclipse Energy Company Limited is a new British independent energy company that recognizes sustainability as a key issue for the future of the UK's offshore energy industry in the 21st Century. The business was founded in February 1999 with the objective of developing, owning and operating low-carbon, sustainable upstream energy projects. The Company has developed an innovative concept for the hybrid production of electricity from offshore natural gas and wind resources. The Company’s first development is the Ormonde Project.

Offshore wind is getting a better start in the UK than in the US, although after years of haggling the Cape Wind project, off Cape Cod, MA in view of the Kennedy compound, now has a better chance of getting approved with a favorable Supreme Court ruling and the departure of Governor Romney. Eclipse's hybrid concept of combining wind and gas generation overcomes the intermittency of wind power, while utilizing gas from fallow gas fields that otherwise would be uneconomical to operate.

World's First Cellulosic Ethanol Plant

Adapted from Celunol launches commercial-scale cellulosic ethanol plant in Japan by C. Scott Miller, BIOconversion Blog, Jan. 21, 2007

BioEthanol Japan, on January 16, became the world’s first company to produce cellulosic ethanol from wood construction waste on a commercial basis.

The plant in Osaka Prefecture has an annual capacity of 1.4 million liters (about 370,000 US gallons). In 2008, it plans to boost production to 4 million liters (1 million US gallons).

BioEthanol Japan was established in 2004 by five companies, including construction firm Taisei Corp., trading house Marubeni Corp., Daiei Inter Nature System, and beermaker Sapporo Breweries Ltd. Marubeni is supplying the process technology, which it has licensed from US-based Celunol, to BioEthanol Japan

The technology is based on the metabolic engineering of microorganisms, a set of genetically engineered strains of Escherichia coli bacteria that can ferment both C6 (hexose) and C5 (pentose) sugars present in cellulosic biomass into ethanol, which are essentially all of the sugars found in cellulosic biomass.

This plant is about one-fourth the size of the plant that Celunol is building in Jennings. It should provide some additional data that will help in the operation of the Jennings plant. I missed this announcement when it came out and am posting it because of its importance. This places the Celunol technology near the top of the technology heap, along with that of Iogen and Abengoa Biorefinery. Iogen just received some financing from the Canadian government to help in upgrading its demonstration plant. It will be a race to see if Celunol gets it US plant in operation before Abengoa Refinery gets its similar sized plant in operation in Spain. I have a feeling that the Celunol technology is a little better, beacause it can currently handle wood chips and the other two operate on straw. That says nothing about the cost of the three processes.

Celunol to Start-up First US Cellulosic Ethanol Plant in Summer 2007

Celunol is a leader in the effort to commercialize the production of cellulosic ethanol. The Company’s technology achieves high ethanol yields from cellulosic biomass at costs competitive with conventional ethanol processes using sugar and starch crops as feedstocks.

The company operates the Jennings pilot facility, on a 140-acre company-owned site in Jennings LA, designed to produce up to 50,000 gallons of ethanol per year. Celunol commenced operation of its newly expanded pilot facility in November 2006.

It is building a 1.4 million gallon demonstration facility to produce ethanol from sugarcane bagasse and wood, targeted for completion in mid 2007. This will be the first commercial scale cellulosic ethanol plant in the United States. Later, the Company is planning a commercial-scale cellulosic ethanol facility at the site.

Celunol’s technology enables almost complete conversion of all the sugars found in cellulosic biomass. This efficiency advantage, combined with the low input cost of cellulosic biomass, results in superior economics in the production of ethanol.

Celunol’s biomass ethanol technology offers numerous marketplace advantages:

• Feedstocks costs will be lower, and less volatile, than corn.
• Cellulosic ethanol facilities can be fueled by lignin waste streams derived from the process itself, avoiding the high and volatile price of natural gas as a boiler fuel for steam and electricity.
• Plants can be located outside traditional ethanol manufacturing areas and near end-use markets, creating a transportation cost advantage.
• Plants handling agricultural or urban wastes, pulp and paper sludge, etc. can simultaneously meet acute waste remediation needs, earn tipping fees, and yield valuable products.

Cellulose contains glucose, the same type of sugar—a six-carbon (C6) sugar—that is found in cornstarch and that can be fermented to ethanol using conventional yeasts. However, hemicellulose contains mainly non-glucose sugars—five-carbon (C5) sugars. Conventional yeasts cannot ferment most non-glucose sugars to ethanol with commercially acceptable yields.

Celunol's technology is based on the metabolic engineering of microorganisms. Its key element is a set of genetically engineered strains of Escherichia coli bacteria that are capable of fermenting, into ethanol, essentially all of the sugars released from many types of cellulosic biomass. This trait enables Celunol to achieve the required efficiency to make the process commercially feasible.

Celunol will use SunOpta's patented pre-treatment equipment and technology in the Jennings facility. SunOpta’s pretreatment and hydrolysis technology will prepare sugar cane bagasse and possibly hard wood waste for conversion into ethanol.

Carlos Riva, President and Chief Executive Officer of Celunol, noted the advantages of acquiring the SunOpta technology, "Incorporating SunOpta's biomass pretreatment system into our proprietary process will further enhance the operating efficiencies of our Jennings facility, and will advance the rapid commercialization of Celunol's cellulosic ethanol technology.

"The demonstration system is planned to be on-site in Jennings the first week in February 2007. Another six to eight weeks after that they’ll be operational,” said Murray Burke, vice president and general manager of SunOpta's BioProcessing Group, meaning a U.S. commercial demonstration plant will be producing ethanol from lignocellulosic materials.

The company has also licensed its technology to Marubeni Corp., a Japanese conglomerate, which has recently started up, the worlds first commercial cellulosic ethanol facility in Osaka, Japan that employs wood waste as a feedstock. The Osaka Project utilizes wood waste as feedstock in producing up to 1.3 million liters of cellulosic ethanol annually. A second phase, planned for completion in 2008, will increase production to 4 million liters per year.

Celunol, formerly BC International, was renamed last year, with four new venture capitalists on board, the company is well-backed financially. One such investor is Vinod Khosla, founder of Sun Microsystems. Other investors include Braemar Energy Ventures, Charles River Ventures and Rho Capital Partners.

Celunol Corporation, a privately held, technology driven company, moved its headquarters to Cambridge, Massachusetts in January 2007. It is leveraging its patented and proprietary biotechnical processes to commercialize the production of cellulosic ethanol—a convenient, environmentally friendly fuel—from a wide array of low-cost, domestically abundant biomass feedstocks.

Celunol's "wet" biomass conversion process http://bioconversion.blogspot.com/2006/08/celunols-wet-biomass-conversion.

The Presidents Budget Request on Energy

The following items, FYI, are take directly from the Presidents budget request (slide 23 & 24):

The Advanced Energy Initiative (AEI):

The AEI is accelerating breakthroughs in how we power our homes, cars, and businesses and will help the U.S. to diversify its sources of energy, reduce dependency on oil and increase our energy security.

• Coal Research Initiative: $385 million to complete the President’s commitment to invest $2 billion over 10 years – three years ahead of schedule— to develop technologies to reduce air emissions while providing domestically secure, cost-efficient electricity from America’s huge coal reserve.

o FutureGen Project: $108 million towards construction of a nearly emissions-free coal plant that captures and stores carbon dioxide rather than releasing it into the atmosphere.

• Solar America Initiative: $148 million toward the goal of making solar technology cost competitive with conventional electricity by 2025.

• Biofuels Initiative: $179 million to research the production of cellulosic ethanol from corn and to make other organic materials available as a competitive energy alternative by 2012.

• Hydrogen Fuel Initiative: $309 million will complete the President’s five-year, $1.2 billion commitment to support the development of commercially viable hydrogen technologies and fuel cell vehicles by 2020.

• Nuclear Power 2010: $114 million—more than double the funding in the 2007 Budget—toward this $1.1 billion government/ private sector partnership to license new reactors and for private industry to obtain licenses for new designs that could result in new power plants ordered by 2009 and operating by 2014.

• Global Nuclear Energy Partnership: $395 million to continue strong support for engineering and design of advanced reactors and new nuclear waste recycling approaches with the potential to reduce the toxicity and volume of nuclear waste that requires disposal in a permanent repository. Solving the nuclear waste issue paves the way for expanding the safe use of nuclear power around the world and at home, promotes nuclear nonproliferation, and resolves nuclear waste disposal issues through an international framework.

• Advanced Battery Research: $42 million to accelerate research on advanced battery technologies for "plug-in" hybrid vehicles that can be recharged at night.

Accelerating deployment of advanced coal technology:

EPAct 2005 authorizes the allocation of $1.65 billion in tax credits to foster more than $9 billion in private investments to construct highly efficient and low emission coal power facilities. $1 billion in tax credits were awarded in 2006

Accelerating scientific progress through the American Competitiveness Initiative (ACI):

ACI is designed to support basic research and world-leading facilities in the physical sciences to enable future breakthroughs and provide economic security benefits.

• Department of Energy's Office of Science: $4.4 billion, to strengthen research and cutting edge facilities, such as new bio-energy research centers; increase contributions toward a major international fusion energy program; expand supercomputing facilities and related research; and support design and construction activities for world-leading light sources.

o $160 million for the United States’ contribution to the International Thermonuclear Experimental Reactor.

Renewable Energy Access also has a post on this subject, they have dug a little deeper in the budget than I have, so it may be worth a read.

Update 12:23 am Feb. 7, 2007: For those interested in more details for the DOE Energy Efficiency and Renewable Energy FY 2008 “Budget-in-Brief” and “Budget Request Presentation” they can be found at:
http://www.eere.energy.gov/ba/pdfs/FY08_budget_brief.pdf
http://www.eere.energy.gov/ba/pdfs/FY08_budget_request.pdf

The Senate Energy & Natural Resources Committee plans a full committee hearing
on the FY 2008 budget proposal for the Department of Energy in 7 February.

While this is a budget request, it is somewhat indicative what might be passed by congress. While I am a big supporter of biofuels, a greater amount for biofuels than solar is not warranted. What is needed is action on demonstration plants for cellulosic biofuels, which was included in last years appropriations (REA found that the amount of loan guarantees would be increased from $4 billion to $9 billion, which I assume includes amounts for IGCC and nuclear plants as well as cellulosic biofuels). Solar, along with wind which is developed to the point that it does not need government funding for research (REA says there is still $40 million in the budget), promises to be the major source of renewable energy in the future. Wave power should have some research at this point.

I support aid for the construction of the first few new generation nuclear plants, but much too much money is being requested for more research, except for the amount to be used to develop better waste disposal technologies. The amount for hydrogen research is also too high compared to what is being requested for biofuels and renewable energy.

Industry is doing pretty well on battery development, but to the extent that the government can help that effort, I don't have any problem with them getting involved.

The fact sheets do not give enough detail to know exactly where the money is going so it is hard to make specific comments or recommendations. That said, I would like to see money removed from the nuclear and hydrogen budgets and transferred to biofuels, solar and a wave research program. I don't see the biofuels amount being reduced, in fact funds should be added for a butanol program. Solar deserves more money than biofuels though. As long as the money is for research and building demonstration projects and not for continuing subsidies, the government has a role to play in providing money that private industry does not have the resources to provide.

UN Report on Global Warming

Let There Be Dark, Or At Least Fewer Watts

Richard T. Stuebi, Cleantech Blog, Feb. 5 2007

Last week, as virtually everyone with an interest in energy and the environment knows, the Intergovernmental Panel on Climate Change (IPCC) gathered in Paris to release the first report of their Fourth Assessment. (see article) The report presents the accumulated evidence of physical change that has already occurred in the climate, and what is expected to or might occur by the end of the 21st Century.

If someone were to read this report and continue thinking that climate change is a hoax, then that person is either unable to read or unable to think. ...

Oil from Algae Could Ease Energy Woes

Algae-Based Fuels Set to Bloom

Kevin Bullis, MIT Technology Review, Feb. 5, 2007

Relatively high oil prices, advances in technology, and the Bush administration's increased emphasis on renewable fuels are attracting new interest in a potentially rich source of biofuels: algae. ...

Kathe Andrews-Cramer, ... at Sandia National Laboratories [says] ... "We could replace certainly all of our diesel fuel with algal-derived oils, and possibly replace a lot more than that."

Raw algae can be processed to make biocrude ... at existing oil refineries to make just about anything that can be made from crude oil. ...

The use of algae for liquid fuels has been studied extensively in the past, including ... a program at ...NREL that ran for nearly a decade. At the time, the results were not encouraging. ... enough has changed that NREL researchers expect to restart the program within the next six months to a year.

The cheapest way to grow algae is in open ponds. But open ponds full of nutrients invite other species to take over, competing with the algae and cutting down production. LiveFuels ... hopes to create algal ecosystems that resist such invaders by ensuring that all the nutrients are converted to forms the algae can easily use.

GreenFuel's John Lewnard, ... says the company thinks it can reach competitive prices without carbon taxes.

Bucking a trend

Feb 1st 2007 | BOGOTÁ
From The Economist print edition

A rare welcome for foreign oil companies

OTHER Andean countries, such as Venezuela, Ecuador and Bolivia, have all put the squeeze on foreign oil companies, with measures ranging from tough new contracts to outright expropriation. But Colombia is putting out the welcome mat.

Colombia shares much of Venezuela's geology. But its oil output is smaller; the last big oil find was by BP at Cusiana in the 1980s. Having been a modest oil exporter for two decades, it faces becoming a net importer unless new discoveries are made. That prospect has prompted President Álvaro Uribe's government to intensify its predecessor's wooing of foreign oil companies. Colombia now offers “among the best fiscal terms in the world”, says William Drennan of Exxon Mobil. These include a sliding scale of royalties varying with production and longer contract terms.

A flurry of investment in exploration to the tune of $1.5 billion a year is starting to produce results. In 2006, for the first time in years, net oil reserves increased slightly, to 1.51 billion barrels. A decade ago, industry analysts expected Colombia to become a net oil importer by 2007. Now that date has been pushed back to 2011, according to a study by Arthur D. Little, a consultancy. If current levels of investment are maintained, Colombia should maintain its oil self-sufficiency at least until 2015, says Armando Zamora, the director of the National Hydrocarbons Agency.

More than a dozen foreign companies are now looking for oil in Colombia. At the same time, Ecopetrol, the state-owned oil company, is operating in a more commercial fashion. It plans to offer 20% of its shares (worth perhaps $3 billion) to private investors. It has joined forces with Petrobras, a like-minded state oil firm, to explore a small field in Brazil.

Having got itself back on the oil map, Colombia hopes to be able to strike a harder bargain. Later this year it will auction contracts to explore offshore in the Caribbean. They will go to the companies that offer the government the biggest production share. Now all that is needed is another Cusiana.

Nuclear Power on the Move

TVA maps new plan to meet energy demand

Dave Flessner, The Chattanooga Times Free Press, January 28, 2007 via MSNBC

To meet the growing energy needs of the Tennessee Valley, TVA estimates it will need the equivalent of a new nuclear power plant every two years. ...

The U.S. Department of Energy picked TVA's Bellefonte site in Hollywood, Ala., for the new AP-1000...

The two new reactors proposed at Bellefonte are among 31 new units being considered nationwide by utility groups ...

By October, TVA and its NuStart partners are due to submit their application to the NRC for a new type of pressurized water reactor -- a Westinghouse AP-1000 design -- at the Bellefonte nuclear plant site. Regulators will have three years to review and sign off on the plans before construction begins. ...

If the license application for the AP-1000 is submitted this year and construction is under way by 2012, any private owners of Bellefonte or similar next-generation plants could qualify for up to $125 million a year in federal subsidies ...

Just an update on what is going on with next-generation nuclear plants, the time frame and subsidies. My position remains the same, that only four of the next-generation plants should be built until the technology is demonstrated. In the meantime conservation, battery based vehicles, wind power, solar troughs and IGCC plants and CTL plants with carbon capture should be the basis of our energy policy. In 3-5 years thin-film PV should be ready for prime tme and become a primary source of renewable energy.

Sharp Increases Efficiency ot Thin Fillm Cells

Sharp Develops Mass-Production Technology for Triple-Junction Thin-Film Solar Cells

Dramatic Improvement in Conversion Efficiency, Mass Production to Begin in 2007

Sharp press release, Jan 24, 2007

Sharp Corporation has successfully developed mass-production technology for stacked triple-junction thin-film solar cells by turning a conventional two-active-layer structure (amorphous silicon plus microcrystalline silicon) into a triple-junction structure with amorphous silicon (two active layers) and microcrystalline silicon (single active layer). This new architecture boosts cell conversion efficiency from 11% to 13% and module conversion efficiency from 8.6% to 10%. Mass production is slated to begin in May 2007 at Sharp’s Katsuragi Plant in Nara Prefecture. ...

Normally, the shift from a two-layer structure to a three-layer structure would demand an increase in production equipment, but these newly developed thin-film solar cells can be fabricated on the same equipment as conventional tandem (two-layer) cells. Consequently, the shift to multiple active layers enables increases in conversion efficiencies and thus a lower price per watt without the need for expensive, large-scale equipment. ...

In a separate press release they announced that they were doubling the capacity of their UK facility to 22o MW.

Thus the efficiency and cost of PV solar is being incrementally reduced by the worlds largest producer of solar cells. This probably indicates that they will eventually shift more of their production to thin-films cells.

Crude suggestion

Feb 1st 2007
From The Economist print edition

There may be an ominous link between oil and bond prices

WHEN stockmarkets fall precipitately, the story makes the nightly television news bulletins. But sudden moves in bond prices rarely attract anything like as much attention, even though the fixed-income market plays a vital economic role, setting the borrowing rate for governments, companies and homeowners.

So people can be excused for not noticing the recent tumble in American bond prices, which had driven yields sharply higher before a slight recovery on January 31st. On that day, the ten-year Treasury bond was yielding 4.83%, almost half a percentage point above its level at the beginning of December (see chart). The 30-year yield, until a decade ago the world's benchmark, was close to 5%.

The obvious cause for the change in mood is the American economy and the policy stance of the Federal Reserve. At the start of December most people thought the Fed would cut interest rates in the first half of 2007, in response to an economic slowdown. But recent data have been stronger than expected, causing most economists to push back their expectations of rate cuts.

However, the bond market is a lot more complex than you might think from the simple mantra of “rate rises bad, rate cuts good”. For a start, bonds can operate as a kind of negative-feedback system; when yields rise, so do mortgage rates (particularly in America, where loan rates are linked to bond yields). Higher rates damage the housing market, and thus the broader economy, a development that can send bond yields back down.

Then there is the complex relation between bonds and oil prices. In the 1970s higher crude prices simply meant rising inflation, which was bad for bonds. Nowadays, thanks in part to sounder monetary stewardship, the relationship has reversed; higher oil prices mean a weaker economy, which is good for bonds.

The oil-bond nexus has acted as a thermostat for the global economy. Higher crude prices restrict demand, cooling the economy down. But the resulting lower bond yields then boost consumer confidence, heating the economy up again. And, as in recent months, falling oil prices (good for consumers) have been accompanied by rising bond yields (bad).

The linkage goes further. When oil prices rise, money flows into the coffers of the producers. Some believe this has helped push bond yields down, because the petrodollars are invested in American Treasuries, much as Asian countries invest their surplus savings.

But pinning down a direct correlation is tricky. Barclays Capital points to a clear connection between oil prices and holdings of Treasury bonds by the Organisation of the Petroleum Exporting Countries (OPEC). But an IMF study* has found few links between oil prices and ten-year Treasury yields, and a paper** by Raman Toloui of PIMCO, the fund management group, suggests an indirect relationship at best. He shows how oil exporters have recently been amassing reserves faster than Asian governments have—last year, he estimates that they generated some $500 billion of reserves, against $284 billion in Asia. Much of this surplus ends up in central banks, or in government outfits like the Kuwait Investment Authority. Mr Toloui reckons that every $10 rise in the price of crude brings oil exporters an extra $90 billion-100 billion a year. Their assets add up to at least $1.5 trillion.

It is not possible to get accurate data on where all this money has been invested. But Mr Toloui reckons that some 40% can be pinned down. The vast bulk (two-thirds) is invested in bank deposits and short-term securities. Only 3% is put into long-dated American Treasuries.

So that would not, at first sight, seem to suggest that oil money has been driving bond yields up and down. Consequently, there should be little reason to fear that lower oil prices will remove a big buyer from the Treasury-bond market.

However, it may be that oil money flows into Treasuries via an indirect route, for example through fund managers acting on the oil nations' behalf. And even if an OPEC country invests its reserves in, say, Japan, that only gives the Japanese more money with which to finance the American current-account deficit.

Americans may, therefore, have just cause for some concern about their bond markets. The oil exporters do not appear to be as keen to buy dollars as do Asian central banks—which want to control their exchange rates to ensure their exports remain competitive. And even Asian nations, such as China, are talking about finding new ways of investing reserves.

In the long run, this could mean that Americans would have to pay more to finance their current-account deficit—a bearish sign. The recent rise in bond yields could be a first step in that reckoning.

On Russian Energy

This entry is my answer on the Economist article "Loveless Brothers ", the biggest lesson is that Russia wants to sell its gas at market prices to all consumers, irrespective of their political relations with Russia. This is a business issue and should not be politicised, for instance by suggesting that Russia is punishing its “former vassals”.

The lessons for east Europeans are: learn to live without Russian subsidies, and don't blackmail Russia with threats of disruption to Russian energy supplies. The best way to stop these threats is to route energy directly from Russia to Europe. For example, Nord Stream will eventually pipe gas from Russia to Germany beneath the Baltic Sea. Projects like this should be supported as they benefit energy stability; eliminating the intermediaries between suppliers and consumers is normal business practice after all.

ASES Has Answer to Global Warming

This entry is an answer to Jay Draiman's comments on my Silicon Valley and Green Technology entry below.

Calvin Jones of Climate Change Action refers readers to a report: Tackling Climate Change in the U.S. According to the report, the American Solar Energy Society (ASES) has the answer to the question: What can we do about global warming? The answer: Deploy clean energy efficiency and renewable energy technologies now!

According to Jones the key findings of their report are:

1) Efficiency can stabilise energy consumption up to 2030.
2) Under these circumstances ever greater penertration of renewable energy can lead to significant decarbonisation and lower greenhouse gas emissions.

In qauntitative terms, emissions reductions from the energy system of 40% by 2030 are shown to be entirely feasible.

Great Point's Coal Gasification Process

Cheaper Natural Gas from Coal

Peter Fairley, MIT Technology Review, Jan. 30, 2007

Great Point says that its catalytic process could put coal back in your basement.

In the second half of the 20th century, oil- and natural gas-burning furnaces drove coal out of the home-heating business across North America. But if Great Point Energy--a Boston-area startup with a low-cost process for converting coal into pipeline-grade natural gas--has its way, coal may start keeping us toasty again before long. ...

The process [takes place] in one single, efficient reactor by moving the catalysts into the gasifier itself. The key is a proprietary, recyclable catalyst developed in house with help from gasification and catalysis experts at Southern Illinois University, the University of Toronto, and the University of Tennessee, among others. The catalyst lowers the amount of heat required to gasify coal and simultaneously transforms the gasified coal into methane. In fact, the heat released in the syngas-to-methane step is sufficient to sustain the gasification, eliminating the need to fire up the reactions with purified oxygen. "It's perfectly heat balanced," says CEO Andrew Perlman. ...

This story is an update on Great Point and familiarizes some of my newer readers with the technology. This technology in many ways is similar to the technology described in about USSEC to turn soybeans into biofuel, but from a much more credible source.

As Green Technology Grows, So Does Silicon Valley

Silicon Valley Rebounds, Led by Green Technology

Laurie J. Flynn, The New York Times, January 29, 2007

After five years of job losses, Silicon Valley is hiring again. The turnaround coincides with a huge increase of investment in the emerging category of clean environment technology. ...

In Silicon Valley, investment in clean technology — from alternative energy products, like solar panels and hybrid cars, to the use of nanotechnology to solve environmental problems — went from $34 million in the first quarter of 2006 to $290 million in the third quarter, according to an annual report released Sunday by Joint Venture: Silicon Valley Network, a research organization in San Jose, Calif. ...

The region first started to show a reversal in late 2005, said Stephen Levy, an economist with the Center for the Continuing Study of the California Economy, a trend he attributed to an increase in worldwide demand for technology products. “Silicon Valley sells more to international markets than any other region, so we can grow as the international market grows, even if the U.S. market isn’t growing.”

It is natural for photovoltaic companies to grow in the home of silicon. The high electronic content of battery powered cars, like Phoenix Motors and Tesla Motors provides an incentive for these companies to locate there. But this isn't the only place for green technology which is distributed pretty evenly across the country.

Could USSEC Proccess Revolutionize Biofuel Industry?

U.S. Sustainable Energy Corp. (USSEC) (OTC:USSE.PK) announced that they have completed the assembly of their new reactor system located at the USSEC Bioenergy plant and fuel production facility in Natchez, Mississippi. The new reactor includes a number of component upgrades, and process improvements made since introducing the prototype last year. The patent pending process is claimed to be a major advancement for green energy that creates a quality 7-3-7 organic-based fertilizer, while also producing unique biofuel and biogas byproducts at very low cost.

The Rivera Process, named after the inventor, John H. Rivera, CEO of USSEC, is a modified pyrolytic process with hydrolysis. The new reactor is capable of producing 6000 gallons of biofuel daily, producing five gallons of fuel from each bushel of soybean stock -- a conversion ratio three times higher than the ratio for traditional biodiesel. The biofuel has a thermal value similar to petroleum diesel, displays no corrosive behavior, and is resistant to temperatures as low as -70 degrees Fahrenheit. The technology is also claimed to be also to run on cow manure and wood chips. Further announcements of additional site locations for operation in 2008 are expected by March.

The reactor is the first of more than 200 planned reactor tubes scheduled for installation over the next 12 months at the Natchez facility, which will have a capacity of 1.5 mgd when completed.

In the Rivera Process natural feed stocks and a proprietary catalyst are heated in a reactor to a relatively high temperature. This heating is typically performed below atmospheric pressure for a time sufficient to vaporize all oils and water from the feedstock and to allow the resultant chemical/mass transfer reactions to occur. The remaining solid is a substantially dry ash, wherein the vapor is extracted to form two biofuels via condensation while recovering lighter gases that are non-condensable at atmospheric pressure. The process is a “volume gain” process similar to catalytic cracking.

USSEC claims that it is able produce biofuel at a cost of less than $1 per gallon, compared with about $2.50 for most biodiesels on the market (prices assume soybeans cost $6 per bushel). And the USSEC cost includes production of biogas and carbon ash.

The heating value of the USSEC biofuel is 128,000 BTU/gal, while the heating value of biodiesel is typically about 117,000 BTU/gal and petroleum diesel is about 130,000 BTU/gal. For comparison, the heating value of typical regular unleaded gasoline is 114,200 BTU/gal, premium gasoline is 116,200 BTU/gal and jet fuel is 122,200 BTU/gal.

The pour point, an indication of the lowest temperature at which the fuel can be pumped, is typically less than or equal to -90°F. For comparison, the pour point for petroleum based diesel is around -16°F; the typical pour point for soy bean based biodiesel is 30°F.

Like pour point, the cloud point is lower than that of a typical biodiesel. At low temperatures, paraffin constituents in a fuel oil may precipitate as a wax forming a cloud. As a practical matter, cloud point is important since the wax formation can clog many fuel filters and render the engine useless. The cloud point is determined as the temperature at which a cloud of wax crystals first appears in the oil when it is cooled. The biofuel has a cloud point less than or equal to -70°F. For comparison, cloud point for petroleum based diesel is about 15°F (without winter fuel conditioners), the typical cloud point for animal fat based biodiesel is 68°F while the cloud point for soy bean based biodiesel is around 35°F.

Thus in addition to being a valuable fuel in its own right, the biofuel can be used as a supplement or blended with other biofuels and diesels to improve their cold weather performance.

The biofuel has a flash point between that of regular gasoline and petroleum diesel, ranging from 90°F to 95°F.

The biofuel also has a viscosity (cSt at 50°C) ranging from 0.8 to 1.1. This range is lower than that of traditional bio-diesels, which range from 1.9 to 6.0 cSt. The higher viscosity of traditional biodiesel has been known to result in gum formation on injectors, cylinder liners, etc. For this reason, it has been required to blend biodiesel with petro-diesels in blends of up to 20% of petro-diesel. The lower viscosity associated with the U.S. Sustainable Energy biofuel is a significant difference and advantage over biodiesels that suffer from gum-formation problems.

Because of the combination of the above properties USSEC biofuel can be used at 100 percent in diesel engines and with a 50/50 blend for gasoline engines without retrofits or modifications. Initially USSEC is using the biofuel for power generation, however it shows great promise for use in cars and trucks. They have run a variety of engines and vehicles, 2 cycle and 4 cycle, diesel and gasoline on the biofuel, for short term testing, which demonstrated the capability of using the biofuel in vehicles. They are considering a variety of transportation markets and will pursue them when it makes sense to do so.

The gas product has a heating value of 1,811 BTU's per cubic foot, while the heating value of natural gas is approximately 1,000 BTU's per cubic foot.

The "Rivera Process" was featured on Channel 13, WHO TV, in Iowa, in a special news cast that presented how low cost energy production is being applied to the creation of ethanol. The video piece, located at www.ussec.us/vde1.html highlighted the impact and importance of USSEC's technology, along with an overview of how it will be applied to partnering company Diversified Ethanol.

OTHER ACTIVITIES

Vidalia, LA
USSEC and Turnkey Electric, the joint venture partner of Pratt & Whitney Power Systems, have a strategic alliance leading to a joint venture to build the world's largest 1,000 Megawatt green power utility in Vidalia, Louisiana, the first United States 100% green power public utility.

John Rivera, CEO of U.S. Sustainable Energy Corp. "USSEC," stated, "With the opening of USSEC's new 500,000 square-foot biofuel facility in Natchez, MS., we will be supplying 100% of the power and electricity consumed by the city of Vidalia, Louisiana through the Vidalia Power and Light Public Utility. Since the electricity will be produced from 100% bio-waste product derived from the production of USSEC's organic 737 fertilizer created from soybeans, the power generated is renewable, recycled and green."

Diversified Ethanol
USSEC and Diversified Ethanol, a division of Originally New York, Inc. (OTC BB:ONYI.OB), have a Memorandum of Understanding (MOU) designed and intended to capture and dominate the multi billion dollar ethanol marketplace.

Diversified has built a 70,000 GPY pilot plant, in Eagle Grove, Iowa at the company headquarters, that is fitted to run on the biofuel from the Rivera reactor. Once the ethanol plant is running, a Rivera reactor will be installed so that it will be able to run on biomass. Their ethanol process uses inexpensive by utilizing a "cold microwave" to break down corn , which can result in ethanol plants using up to 30% less corn to get the same amount of sugars. The process "creates no waste water, and no waste solids, and their is no venting of bad waste gasses." As of Jan. 14, 2006 Diversified had powered up its pilot plant, one piece at a time, successfully completing sectional testing.

At he signing of the MOU Rivera stated, "Our immediate goal, is to construct a million gallon per day ethanol plant to be supported by the excess energy generated by USSEC and our subsidiary Sustainable Power Corp (SPC). Using Diversified Ethanol's technology we will obtain up to 30% more sugars from the corn we will process, according to independent university research. In addition, according to industry experts we will also save between 30-35% on our energy costs in producing ethanol, making our product the most cost competitive ethanol anywhere in the world."

Diversified intends to begin utilizing the low-cost fuel to power its own ethanol plants with nearly free steam. By combining Diversified Ethanol and USSEC's technology, the company believes it can produce 200 proof ASTM certified ethanol 60% cheaper than any other technology in the world.

Massachusetts Consortium
In a separate announcement a Memorandum Of Understanding was signed detailing the creation in Western Massachusetts of what could be the largest green electrical energy consortium in the Northeast.

The MOU calls for the formation of a green consortium to be owned jointly by USSEC, Vegetable Energy Group, LLC d/b/a Vee-Go Energy; and E2M.org (www.e2m.org). This consortium will work with USSEC subsidiary Sustainable Power Corporation to provide wholesale green electrical energy and generation plants to public and municipal electricity buyers throughout the state. The green electricity will be generated by SPC using their biofuel.

USSEC and SPC have offered to provide the fuels and equipment that could enable the Mt. Tom Power Station to significantly reduce their current CO2 and other emissions and provide 150 megawatts of new green generation capacity. The consortium has also offered to install smaller turbine generators in municipal utilities located in Western Mass. and throughout the state. They have offered to provide buyers with green electricity at a guaranteed 10% discount below the lowest fossil fuel electricity prices for a term of ten to twenty years.

This "biofuel" and the process for making it seems to be one of those things that is to good to be true. Companies with a lot of press releases, low stock prices and a lot of MOUs and "strategic alliances" always make me wary of what is going on. However USSEC seems to be backing it up with a considerable investment in the facility and a logical development plan - it seems to me to be a big risk to have such a large facility with only one reactor ready to test, although they have tested a previous version. If they can produce a fuel with those properties, for the cost that they claim, they certainly will revolutionize the biofuel industry. Biodiesel never made that much sense to me for temperate climates with its problems with cold weather, but this fuel seems to have those problems fixed. And it even can use wood chips a feedstock! I will certainly be waiting and watching to see how this one turns out. Best of luck to them, we certainly could benefit from having a process like theirs.

Process Improvements Reduce Ethanol Costs

Engineers Devise New Process To Improve Energy Efficiency of Ethanol Production

Carnegie Mellon University press release, Jan. 26, 2006

Carnegie Mellon University chemical engineers have devised a new process that can improve the efficiency of ethanol production, a major component in making biofuels a significant part of the U.S. energy supply.

Carnegie Mellon researchers have used advanced process-design methods combined with mathematical-optimization techniques to reduce the operating costs of corn-based bio-ethanol plants by more than 60 percent.

The key to the Carnegie Mellon strategy involves redesigning the distillation process by using a multicolumn system together with a network for energy recovery that ultimately reduces the consumption of steam, a major energy component in the production of corn-based ethanol.

"This new design reduces the manufacturing cost for producing ethanol by 11 percent, from $1.61 a gallon to $1.43 a gallon," said Chemical Engineering Professor Ignacio E. Grossmann. ... "This research is also an important step in making the production of ethanol more energy efficient and economical."

More Hype on the Volt

GM's 30-Person Battery Team; BizWeek Sees Japanese Win on PHEVs

By Felix Kramer, CalCars

A few key clips from the stories, followed by full text:

* The Volt is going some way to persuade cynics that U.S. automakers are finally getting serious about environmental technologies.
* Many industry watchers, especially those in Japan, remain skeptical that the Volt will do much to narrow the gap between GM and hybrid leaders Toyota and Honda.
* While details are scant, Toyota is also working on plug-in hybrids of its own.
* Honda is working on ... plug-in hybrids of its own.
* A breakthrough in Li-ion battery technology...is expected to happen in Japan [from] Sanyo Electric, which supplies hybrid batteries to Honda and Ford, and Panasonic EV Energy, in which Toyota has a 60% stake. ...

This post, references several articles, full text included, about the GM Volt and the hype it has created, including the speculation that Sanyo will have a battery breakthrough.

Xebra Sparks Interest in Electric Cars

New electric cars spark interest all over Bay Area

Inside Bay Area, January 27, 2007

Xebras, which are made in China, come in lipstick red, ... black-and-white stripes, kiwi green and ocean blue. There's also a pickup truck version, the ZAP Truck Xebra PK, available in blue and white. ...

The cars have only three wheels and technically are classified as motorcycles, although you don't need a helmet or a special license to drive one. ... The Xebra sells for around $10,000 and the trucks sell for around $11,000. ...

While the cars are cheap to operate, require little maintenance and are easy on the environment, they have significant limitations. You can't take a Xebra on the freeway because it only reaches 40 mph. And they can only travel about 25 miles per charge, or up to 40 miles a day with additional charging, which is accomplished by plugging the cars into an ordinary household 110-volt outlet.

I have avoided writing a post on this car, but this article saved me the work for those of your that are interested.

Financing Plan for Renewables Transmission Lines

California ISO Asks Federal Government to Back New Plan for ''Greening the Grid''

California ISO, press release, January 25, 2007

In a precedent-setting move that could have national implications, the California Independent System Operator Corporation (California ISO) filed today with its regulator, the Federal Energy Regulatory Commission (FERC), to approve in concept a financing plan for transmission trunklines to remote locations in order to get green power from multiple users onto the grid. ...

If the new payment mechanism is approved and implemented, it would be a first-of-its-kind means of removing financial barriers that can hinder development of wind, solar, geothermal ... renewable energy resources. ...

“We don’t have a choice as to where these natural resources are located,” said Rich Ferguson research director for the Center for Energy Efficiency and Renewable Technologies. “If we’re going to use these assets to offset less environmentally friendly types of power generation, we need to be able to build the transmission lines that reach those remote locations.” ...

This press release points out very well one of the big problems that renewable energy power plants have in becoming a larger factor in competing with conventional power sources. Even larger problems are expanding the grid so that power can be transmitted to widely separated geographical areas. How these costs should be passed on to the consume, must be determined before financing these projects can go foreword.

Unfortunately affordable high temperature superconducting (HTS) transmission cables are still years away from widespread use, even though significant progress is being made. See Amercan Superconductor Reports Out sanding Progress, ACCC (Aluminum Conductor Composite Core) cable and Second Generation Superconducting Cable Energized, for some of the developments being made in newer technologies for our transmission lines.

The greening of America

Jan 25th 2007
From The Economist print edition

How America is likely to take over leadership of the fight against climate change; and how it can get it right

A COUNTRY with a presidential system tends to get identified with its leader. So, for the rest of the world, America is George Bush's America right now. It is the country that has mismanaged the Iraq war; holds prisoners without trial at Guantánamo Bay; restricts funding for stem-cell research because of fundamentalist religious beliefs; and destroyed the chance of a global climate-change deal based on the Kyoto protocol.

But to simplify thus is to misunderstand—especially in the case of huge, federal America. One of its great strengths is the diversity of its political, economic and cultural life. While the White House dug its heels in on global warming, much of the rest of the country was moving (see article). That's what forced the president's concession to greens in the state-of-the-union address on January 23rd. His poll ratings sinking under the weight of Iraq, Mr Bush is grasping for popular issues to keep him afloat; and global warming has evidently become such an issue. Albeit in the context of energy security, a now familiar concern of his, Mr Bush spoke for the first time to Congress of “the serious challenge of global climate change” and proposed measures designed, in part, to combat it.

Hot for the time of year

It's the weather, appropriately, that has turned public opinion—starting with Hurricane Katrina. Scientists had been warning Americans for years that the risk of “extreme weather events” would probably increase as a result of climate change. But scientific papers do not drive messages home as convincingly as the destruction of a city. And the heatwave that torched America's west coast last year, accompanied by a constant drip of new research on melting glaciers and dying polar bears, has only strengthened the belief that something must be done.

Business is changing its mind too. Five years ago corporate America was solidly against carbon controls. But the threat of a patchwork of state regulations, combined with the opportunity to profit from new technologies, began to shift business attitudes. And that movement has gained momentum, because companies that saw their competitors espouse carbon controls began to fear that, once the government got down to designing regulations, they would be left out of the discussion if they did not jump on the bandwagon. So now the loudest voices are not resisting change but arguing for it.

Support for carbon controls has also grown among some unlikely groups: security hawks (who want to reduce America's dependence on Middle Eastern oil); farmers (who like subsidies for growing the raw material for ethanol); and evangelicals (who worry that man should be looking after the Earth God gave him a little better). This alliance has helped persuade politicians to move. Arnold Schwarzenegger, California's Republican governor, has led the advance, with muscular measures legislating Kyoto-style curbs in his state. His popularity has rebounded as a result. And now there is movement too at the federal level, which is where it really matters. Since the Democrats took control of Congress after the November mid-term elections, bills to tackle climate change have proliferated. And three of the serious candidates for the presidency in 2008—John McCain, Hillary Clinton and Barack Obama—are all pushing for federal measures.

Europe's good, and bad, example

Unfortunately, Mr Bush's new-found interest in climate change is coupled with, and distorted by, his focus on energy security. Reducing America's petrol consumption by 20% by 2017, a target he announced in the state-of-the-union address, would certainly diminish the country's dependence on Middle Eastern oil, but the way he plans to go about it may not be either efficient or clean. Increasing fuel-economy standards for cars and trucks will go part of the way, but for most of the switch America will have to rely on a greater use of alternative fuels. That means ethanol (inefficient because of heavy subsidies and high tariffs on imports of foreign ethanol) or liquefied coal (filthy because of high carbon emissions).

The measure of Mr Bush's failure to tackle this issue seriously is his continued rejection of the only two clean and efficient solutions to climate change. One is a carbon tax, which this paper has long advocated. The second is a cap-and-trade system of the sort Europe introduced to meet the Kyoto targets. It would limit companies' emissions while allowing them to buy and sell permits to pollute. Either system should, by setting a price on carbon, discourage its emission; and, in doing so, encourage the development and use of cleaner-energy technologies. Just as America's adoption of catalytic converters led eventually to the world's conversion to lead-free petrol, so its drive to clean-energy technologies will ensure that these too spread.

A tax is unlikely because of America's aversion to that three-letter word. Given that, it should go for a tough cap-and-trade system. In doing so, it can usefully learn from Europe's experience. First, get good data. Europe failed to do so: companies were given too many permits, and emissions have therefore not fallen. Second, auction permits (which are, in effect, money) rather than giving them away free. Europe gave them away, which allowed polluters to make windfall profits. This will be a huge fight; for, if the federal government did what the Europeans did, it would hand out $40 billion-50 billion in permits. Third, set a long time-horizon. Europeans do not know whether carbon emissions will still be constrained after 2012, when Kyoto runs out. Since most clean-energy projects have a payback period of more than five years, the system thus fails to encourage green investment.

One of America's most admirable characteristics is its belief that it has a duty of moral leadership. At present, however, it's not doing too well on that score. Global warming could change that. By tackling the issue now it could regain the high moral ground (at the same time as forging ahead in the clean-energy business, which Europe might otherwise dominate). And it looks as though it will; for even if the Toxic Texan continues to evade the issue, his successor will grasp it.

Bodmans Comments on the State of Union Address Regarding Energy

Various news agencies reported on Energy Secretary Samuel Bodman's statements at the World Economic Forum's annual meeting, that the U.S. "will need to have more imports of ethanol," if it is to meet the new mandate to cut gasoline use.

Bodman also said that he did not see a 51-cent-a-gallon subsidy to U.S. farmers remaining in place beyond 2010 or import tariff on ethanol of 54 cents a gallon beyond 2008. These remarks were made in regard to Bush's proposal outlined in Tuesday's State of the Union address in which the president said that he aims to cut gasoline use by 20 percent by 2017, mostly by replacing the fuel with ethanol, and by expected improvements in automobile fuel economy.

"The idea is that at some point in the future all these technologies need to stand the test of the free market," Bodman said.

Another report quoted Bodman as saying that the U.S. "must go beyond corn" to increase ethanol supplies. Corn could produce only 12 billion to 15 billion gallons of fuel a year, so the nation must develop ways to derive ethanol from plant waste.

Bodman admitted that technology currently doesn't exist to produce the needed ethanol quantities in a cost-effective manner. There is “an element of trust that U.S. companies can develop the technology to meet the target," Bodman said. He said he’s "cautiously optimistic this will happen," but that the U.S. "will need to have more imports of ethanol."

Bodman also defended Bush's drive to reduce oil consumption without higher gasoline taxes.

"The idea of taxing gasoline at an increased level, which is something that gets discussed from time to time, I view as a highly divisive matter," he said.

Bodman said nuclear power would have to play an important role in future U.S. energy planning. "I see no alternative other than nuclear power as an emissions-friendly source of electrical power," he said.

So the discussion goes on. Any way, my that we could not meet Bush's goals from domestic supplies is confirmed by another source. I think his implication of how much corn ethanol we will produce is high. Or at least his use of the word could should not be interpreted as will. Of course we could, but it would be at the expense of food supplies and high prices. Where the actual number will come in is pretty much up in the air now. I have always thought that the importation of ethanol from the Caribbean, Central America and South America would be a good idea, benefiting US needs and their economies. The use of butanol and coal to liquids to supplement ethanol was not brought up however.

The need for producing these quantities of renewable and alternative fuels should not be dismissed. For reasons of national security, energy independence, the risk of inflation and a severe economic downturn and for the economic benefit of our farmers we need to develop these supplies.

I support the reduction of subsidies and tariffs on ethanol so that a free trade on ethanol can be had and our domestic producers do not indulge in price gouging as would be possible with them. The market for ethanol must be maintained however and I support ever increasing requirements for alternative and renewable fuels as required to meet the production required to assure the goals outlined in the previous paragraph.

Their certainly are other alternatives to nuclear, but are they better? I happen to think clean coal with carbon capture is better.

New Report Finds Huge Power Potential in Geothermal Resources

The thermal energy stored in the Earth's crust could be converted into electricity to provide a substantial portion of future U.S. power needs, probably at competitive prices and with minimal environmental impact, according to a new study, MIT press release, full report (14 MB pdf), sponsored by DOE and led by the Massachusetts Institute of Technology (MIT). A 21-member expert panel released a report that examines the potential to tap into the heat in Earth's crust and convert it into electricity. The report found the potential to generate 100,000 megawatts of power from geothermal resources within 50 years. That's roughly one-tenth of the total generating capacity that exists in the United States today.

While today's geothermal power plants draw from underground reservoirs of hot, permeable rock containing significant amounts of water or steam, the MIT-led panel specifically examined enhanced geothermal system (EGS) technology, which involves creating such geothermal reservoirs in areas that lack either the water or the permeability, or both. Such technologies were previously tested by DOE in New Mexico and are currently being explored in Europe and Australia. See my previous post and the EGS technology description on the DOE Geothermal Program Web site.

Thanks in part to advances in drilling technologies for the oil and gas industries, the process of drilling deep into the crust to access hot, hard layers of rock and pumping water in to "stimulate" the reservoir—opening up cracks in the rock to allow water to permeate through—has already been proven. The report recommends more detailed and site-specific assessments of the U.S. geothermal resource, followed by several field trials at prime locations that would run for three to five years as a demonstration of the EGS technology.

EGS technology offers a huge expansion to the possible locations that can use geothermal energy and is a promising technology for the relatively long term. While conventional geothermal can continue to be a growing part of our renewabole energy potfolio now, EGS will take at least 15 years to fully develop and require a modest $1 billion investment over that time period, an investment that should be made. It is important that we make this investment because it is a low cost way to increase our energy indepence in a renewable way that can reduce the need for new fossil fuel and nuclear plants.

I am late on reporting on this potentially breakthrough technology, but is so important that it deserves a great deal of attention. Clean Break has a good blog on the subject and Atlantic Geothermal has a list of all the blogs that have been made on the subject.

Bush's Energy Reduction Executive Order Includes Provisions Requiring Purchase of Plug-in Vehicles

On Wednesday President Bush issued an executive order stating that

"It is the policy of the United States that Federal agencies conduct their environmental, transportation, and energy-related activities under the law in support of their respective missions in an environmentally, economically and fiscally sound, integrated, continuously improving, efficient, and sustainable manner."

He instructed government agencies to take eight steps to reduce energy consumption, two of which I am focusing on.

1) If agencies operates a fleet of at least 20 motor vehicles

(i) reduce the fleet's total consumption of petroleum products by 2 percent annually through the end of fiscal year 2015,
(ii) increases the total fuel consumption that is non-petroleum-based by 10 percent annually, and
(iii) use plug-in hybrid (PIH) vehicles when PIH vehicles are commercially available at a cost reasonably comparable, on the basis of life-cycle cost, to non-PIH vehicles

The reduction in use of petroleum products sounds quite reasonable, but not very aggressive. As pointed out in Autopia the order does not require that total fuel consumption go down, only that petroleum consumption be reduced. I find the order remiss in that it does not require any increases in the fuel efficiency of vehicles. This requirement could be interpreted as being included in my point two, as being part of the overall energy efficiency of the agency. I do not find this interpretation specific enough.

I find the increased use of non-petroleum-based fuel is extremely aggressive, as it could require the purchase of flex-fueled vehicles before the current vehicles would normally be replaced.

I am especially encouraged that the order included plug-in vehicles. The term "use of plug-in hybrid vehicles" does not define how much they must be used and thus leaves a potential loop hole. The life-cycle cost of PHEVs should allow well engineered PHEVs to be purchased at an early date. I wish the clause requiring PHEVs to be available commercially had been worded differently. I interpret it as meaning that they could be purchased from any company, large or small, offering the vehicles in any quantity, domestic or foreign made. This would be a fine policy, but I would like it spelled out as I have done, avoiding other interpretations of the policy.

2) Reduce energy intensity of each agency by:

(i) 3 percent annually through the end of fiscal year 2015, or
(ii) 30 percent by the end of fiscal year 2015, relative to the baseline of the agency's energy use in fiscal year 2003.

It is hard to judge whether these are reasonable goals, but they sound OK to me and I am supportive of such goals.

Thanks to the tip from Wired News Autopia

The State of the Union on Energy

In his State of the Union Address, President Bush called for an energy agenda having these main points:

1) Greater use of coal, solar, wind and nuclear
2) Battery research for plug-in and hybrid vehicles
3) Expand the use of clean diesel vehicles
4) Greater emphasis on cellulosic ethanol
5) Reduce gasoline usage by 20 percent in the next ten years by
5a) Setting a mandatory Fuels Standard of 35 billion
gallons of renewable and alternative fuels in 2017
5b) Adopting fuel economy standards for cars to conserve
eight and a half billion gallons of gasoline by 2017

I don't really have any objection to these points, except to say that I think we could reduce gasoline consumption by more than 20% by having even higher economy standards for cars and a really good push on batteries and plug-ins, electric cars ought to be included, we ought to include butanol and geothermal in our stable of renewable fuels, we need an a greater effort on more efficient power transmission technologies if we are going to take full advantage of renewable energy sources and we should place a high priority on energy storage technologies.

The best way to encourage better batteries would be to require the post office to replace its fleet with electric vans and require the other government agencies to use efficient hybrids. By the time laws were enacted and RFP's written a couple of years would pass by and the technology would be even better.

The only money we need to spend on coal technology is to encourage IGCC plants and carbon capture technologies, this program is pretty well in place, if more money would speed it up all the better. Getting the money that has been authorized into the budget and released is probable all that is needed.

I know that increased use of coal and nuclear will be controversial among many of my readers, but I don't see any way other technologies can take their place in the next 25 to 50 years. I am sure there are those of you that think that government spending for energy technologies is not necessary, that market forces would provide all the incentives that are needed. This is too much of a risk. The cost of our liquid fuels are increasing at too high a rate, despite the recent lull, and if we are not to have drastic economic effects we must push on with alternative energy sources before this happens. All the money we need for these programs could come from reducing the subsidies on hydrogen, fuel cells and the oil industry.

The complete text of his six paragraphs on energy policy are found in the continuation:

"Extending hope and opportunity depends on a stable supply of energy that keeps America's economy running and America's environment clean. For too long our Nation has been dependent on foreign oil. And this dependence leaves us more vulnerable to hostile regimes, and to terrorists - who could cause huge disruptions of oil shipments ... raise the price of oil ... and do great harm to our economy.

It is in our vital interest to diversify America's energy supply - and the way forward is through technology. We must continue changing the way America generates electric power - by even greater use of clean coal technology ... solar and wind energy ... and clean, safe nuclear power. We need to press on with battery research for plug-in and hybrid vehicles, and expand the use of clean diesel vehicles and biodiesel fuel. We must continue investing in new methods of producing ethanol - using everything from wood chips, to grasses, to agricultural wastes.

We have made a lot of progress, thanks to good policies in Washington and the strong response of the market. Now even more dramatic advances are within reach. Tonight, I ask Congress to join me in pursuing a great goal. Let us build on the work we have done and reduce gasoline usage in the United States by 20 percent in the next ten years - thereby cutting our total imports by the equivalent of three-quarters of all the oil we now import from the Middle East.

To reach this goal, we must increase the supply of alternative fuels, by setting a mandatory Fuels Standard to require 35 billion gallons of renewable and alternative fuels in 2017 - this is nearly five times the current target. At the same time, we need to reform and modernize fuel economy standards for cars the way we did for light trucks - and conserve up to eight and a half billion more gallons of gasoline by 2017.

Achieving these ambitious goals will dramatically reduce our dependence on foreign oil, but will not eliminate it. So as we continue to diversify our fuel supply, we must also step up domestic oil production in environmentally sensitive ways. And to further protect America against severe disruptions to our oil supply, I ask Congress to double the current capacity of the Strategic Petroleum Reserve.

America is on the verge of technological breakthroughs that will enable us to live our lives less dependent on oil. These technologies will help us become better stewards of the environment - and they will help us to confront the serious challenge of global climate change."

The complete text of the speech can be found here.

Free Solar Power for Staples

The Connecticut Clean Energy Fund (CCEF), Staples and SunEdison hosted a dedication ceremony on Jan. 16 to unveil the largest solar power installation in New England at Staples’ 300,000-square-foot retail distribution center in Killingly, Connecticut. The solar power installation, built at no capital cost to Staples, was made possible through the collaborative effort of CCEF, which provided a $1.7 million grant for the project, and SunEdison, which financed the remaining costs of the project and designed and installed the system.

Is this the way we want to see our solar projects financed? Or is this type of financing necessary to enable expansion of the industry so it is more competitive with conventional power? I certainly think that the end user should pay a share of the costs. I don't especially blame Staples for taking advantage of a business opportunity.