Open e-mail to Rep. Neugebauer:
Rep. Neugebauer:
I have to hand to the Obama Administration for developing innovative ways to accomplish its goals. I say this in the same context that I admire the ability of thieves to develop new ways to steal.
I just heard on Fox News that the Justice Department is investigating criminal prosecution of managers and engineers of BP for the Gulf oil spill.
With this new development, any oil drilling executives and engineers would have to be out of their minds to continue drilling for oil and gas in the traditional manner of facing the hazards of natural forces and some beleageurment with government regulations. They would now have to worry about personal fines and jail time.
It would not even be necessary for the Justice Department to actually conduct an investigation with intent to prosecute. The mere threat that this is a possibility will put the fear of God into operators.
The outcome of this will be that oil and gas drillers will either go out of business, which is highly unlikely, or more likely they will be developing a strategy to deal with it. The most obvious strategy is to reduce the risk of natural disaster. This can be done by cutting back on deep water drilling and only drill far off the coasts of populated areas. This has two negative effects. The big possibilities of large oil reserves being discovered is considerably reduced. Any oil and gas which would be discovered in remote regions would involve significant costs for transportation either through pipeline or tankers.
A second strategy is to not move a muscle, unless all details of an operation are approved in writing by federal inspectors. This would include development of horrendous safety plans, with details on composition and manufacturing techniques of all physical parts used in the drilling operation and a complete (perhaps thousands of pages) of corrective actions which might be taken in case of accident. This would include details of financial compensations and a multitude of associated legal documents. The net result would be to hamstring the already half hamstrung operation of drilling. Oil and gas production would be significantly reduced and the cost of any production would be significantly higher, with correspondingly higher prices to the consuming public.
Rep. Neugebauer, what are you going to do about this atrocity perpetrated on your constituency?
Thursday, December 29, 2011
Wednesday, December 21, 2011
Department of Energy Waste
In the October 17th issue of Chemical & engineering News, Jeff Johnson has a nicely informative article on the Department of Energy's expenditures for loan guarantees and grants to promote "clean" energy.
At the end of September, the Department of Energy awarded $4.7 billion loan support for four photovoltaic solar projects in California, $1.5 billion to install ground-level solar panels, $1.4 billion to install rooftop solar panels, $1.2 billion for a solar "ranch", and $646 million for a thin-film solar project. This is all based on Congress' passage of the American Recovery & Reinvestment Act of 2009, which I have previously strongly recommended should be repealed by Congress and removed from separate funding.
The DOE also offers another $10.6 billion for clean energy projects through a separate loan guarantee program that is not dependent on stimulus money.Two other guarantees would support solar installations in the West—$737 million for a 110-MW concentrating solar power tower project in Nevada and $337 million for a 150-MW PV facility in Arizona. The remainder would guarantee a $132 million loan for a commercial-scale cellulosic ethanol plant in Kansas.
In all, $13.3 billion of the $16.1 billion American Recovery & Reinvestment Act (ARRA) funded program supports loans for solar-related projects.
Also at the end of September, DOE announced $156 million in grants to 60 research teams under DOE’s ARPA-E program, which funds transformative energy research projects. It is the fourth round of ARPA-E grants.
In the two years since it was first funded, ARPA-E has provided $522 million to 180 projects,
The ARPA-E grant projects involve biofuel production, alternatives to rare earth minerals, storage transport and use of thermal energy, automating the electricity grid, and grid connection of PV (solar) generated electricity. Those funds are almost equally distributed among universities, small businesses, and large businesses.
I have previously said, and I will say again, that these programs are a complete waste of taxpayer money. There is absolutely no need to try to replace the traditional sources of energy, such as natural gas and petroleum with solar and wind. US fossil fuel reserves can be harvested at costs significantly below anything that could involve solar energy.
I have recommended previously that the Department of Energy be eliminated. It was originally set up by Congress and can also be removed by Congress. From a practical consideration, the Senate will obviously vote for continued existence, as will the President. However, the House must go on record as having taken the initiative, and after the forthcoming elections of 2012, we will be able to see some positive action through a new Senate and President.
At the end of September, the Department of Energy awarded $4.7 billion loan support for four photovoltaic solar projects in California, $1.5 billion to install ground-level solar panels, $1.4 billion to install rooftop solar panels, $1.2 billion for a solar "ranch", and $646 million for a thin-film solar project. This is all based on Congress' passage of the American Recovery & Reinvestment Act of 2009, which I have previously strongly recommended should be repealed by Congress and removed from separate funding.
The DOE also offers another $10.6 billion for clean energy projects through a separate loan guarantee program that is not dependent on stimulus money.Two other guarantees would support solar installations in the West—$737 million for a 110-MW concentrating solar power tower project in Nevada and $337 million for a 150-MW PV facility in Arizona. The remainder would guarantee a $132 million loan for a commercial-scale cellulosic ethanol plant in Kansas.
In all, $13.3 billion of the $16.1 billion American Recovery & Reinvestment Act (ARRA) funded program supports loans for solar-related projects.
Also at the end of September, DOE announced $156 million in grants to 60 research teams under DOE’s ARPA-E program, which funds transformative energy research projects. It is the fourth round of ARPA-E grants.
In the two years since it was first funded, ARPA-E has provided $522 million to 180 projects,
The ARPA-E grant projects involve biofuel production, alternatives to rare earth minerals, storage transport and use of thermal energy, automating the electricity grid, and grid connection of PV (solar) generated electricity. Those funds are almost equally distributed among universities, small businesses, and large businesses.
I have previously said, and I will say again, that these programs are a complete waste of taxpayer money. There is absolutely no need to try to replace the traditional sources of energy, such as natural gas and petroleum with solar and wind. US fossil fuel reserves can be harvested at costs significantly below anything that could involve solar energy.
I have recommended previously that the Department of Energy be eliminated. It was originally set up by Congress and can also be removed by Congress. From a practical consideration, the Senate will obviously vote for continued existence, as will the President. However, the House must go on record as having taken the initiative, and after the forthcoming elections of 2012, we will be able to see some positive action through a new Senate and President.
Wednesday, December 14, 2011
Too Many Eggheads Pushing Uneconomical Solar Energy
Jeff Johnson has a two-page article entitled "Uncertainties Slows Energy Investments", with a subtitle, "House-led DOE investigation is likely to reduce US clean energy investments, growth", in the November 21 issue of C&E News. The essence of the article is that the investigation of the Solyndra bankruptcy could involve shutdown of other solar energy companies and cost the American taxpayers.
Johnson makes the point that the Solyndra investigation has put the kabosh on private investments for solar energy development. I judge that to be a good thing. The only reason private investors would possibly be interested in solar energy is because of the complete absence of risk for their investment through government loan guarantees and the possibility of greater profits through government subsidies, if at project is successful.
The Senate is not following a similar Solyndra investigation. Bill Wicker, the Communications Director, of the Senate Energy and Natural Resources Committee said, "A more thoughtful look at the financial gap for advanced energy technologies between the US and its international competitors, like China, does make sense". I completely disagree. The implication that solar energy is an advanced technology is completely unjustified in the present economy. In addition, the Chinese government has contributed only a pittance in the support of its solar energy equipment producers. It has done so, not because it is a strong believer in the economics of solar energy, but that because the US is a good potential market for this equipment.
Cliff Stearns, Chairman of the House Committee on Energy and Commerce Oversight And Investigations Subcommittee, hit the nail on the head, when he said, "Even with oil at $140 a barrel, the idea that solar energy will be breakeven is questionable." As a reminder, the present price of oil is about $100 per barrel, and this has been artificially propped up by the Obama Administration by refusing drilling leases to oil production companies in the US. The latest situation is Obama's refusal to allow construction of an oil pipeline from Canada to the Gulf Coast. The Obama Administration is doing everything it can through DOE Secretary Chu to prop up the price of oil and gasoline, in order to justify taxpayer expenditures for solar energy. This is an ideological consideration unjustified by the economics of present reality. The problem is that we have too many eggheads confusing the situation.
One is Frank Laird, a professor at the University of Denver. He says, "The size of credit matters less than keeping it in place long enough to provide consistency for investors". He apparently doesn't understand money. As an example, suppose we allocate $1 trillion of taxpayer money for solar energy development each year for the next 10 years. Is this going to attract private investment? The answer is obviously yes. Private investment will have no risk for its own money, because of loan guarantees with taxpayer money. In addition, if by slight chance there is a profit to be made, it will become significant through further government subsidies. While this tends to support Laird's statement, consider the fact that an equal amount of energy could probably have been produced at significantly less cost through the oil and gas route and without the use of taxpayer money.
Another egghead is David Goldston, who is the Director of Government Affairs for the Natural Resources Defense Council, an environmental group. He says, "To develop energy sources beyond the current mix of coal, oil and petroleum takes government support." I could possibly agree with that, but then I have to ask the question, why would we want to do that? Coal, oil, and petroleum are already doing the job even with the inhibitions placed on it by the Obama Administration. Even the most ardent supporters of solar energy, when caught in a rational state of mind, will admit that solar energy can not compete economically. We should not be dumping taxpayer money down this rat hole.
Johnson makes the point that the Solyndra investigation has put the kabosh on private investments for solar energy development. I judge that to be a good thing. The only reason private investors would possibly be interested in solar energy is because of the complete absence of risk for their investment through government loan guarantees and the possibility of greater profits through government subsidies, if at project is successful.
The Senate is not following a similar Solyndra investigation. Bill Wicker, the Communications Director, of the Senate Energy and Natural Resources Committee said, "A more thoughtful look at the financial gap for advanced energy technologies between the US and its international competitors, like China, does make sense". I completely disagree. The implication that solar energy is an advanced technology is completely unjustified in the present economy. In addition, the Chinese government has contributed only a pittance in the support of its solar energy equipment producers. It has done so, not because it is a strong believer in the economics of solar energy, but that because the US is a good potential market for this equipment.
Cliff Stearns, Chairman of the House Committee on Energy and Commerce Oversight And Investigations Subcommittee, hit the nail on the head, when he said, "Even with oil at $140 a barrel, the idea that solar energy will be breakeven is questionable." As a reminder, the present price of oil is about $100 per barrel, and this has been artificially propped up by the Obama Administration by refusing drilling leases to oil production companies in the US. The latest situation is Obama's refusal to allow construction of an oil pipeline from Canada to the Gulf Coast. The Obama Administration is doing everything it can through DOE Secretary Chu to prop up the price of oil and gasoline, in order to justify taxpayer expenditures for solar energy. This is an ideological consideration unjustified by the economics of present reality. The problem is that we have too many eggheads confusing the situation.
One is Frank Laird, a professor at the University of Denver. He says, "The size of credit matters less than keeping it in place long enough to provide consistency for investors". He apparently doesn't understand money. As an example, suppose we allocate $1 trillion of taxpayer money for solar energy development each year for the next 10 years. Is this going to attract private investment? The answer is obviously yes. Private investment will have no risk for its own money, because of loan guarantees with taxpayer money. In addition, if by slight chance there is a profit to be made, it will become significant through further government subsidies. While this tends to support Laird's statement, consider the fact that an equal amount of energy could probably have been produced at significantly less cost through the oil and gas route and without the use of taxpayer money.
Another egghead is David Goldston, who is the Director of Government Affairs for the Natural Resources Defense Council, an environmental group. He says, "To develop energy sources beyond the current mix of coal, oil and petroleum takes government support." I could possibly agree with that, but then I have to ask the question, why would we want to do that? Coal, oil, and petroleum are already doing the job even with the inhibitions placed on it by the Obama Administration. Even the most ardent supporters of solar energy, when caught in a rational state of mind, will admit that solar energy can not compete economically. We should not be dumping taxpayer money down this rat hole.
Friday, December 9, 2011
Cheap Energy Will Make the US More Economically Competitive
Open e-mail to Rep. Neugebauer:
Randy,
More talk in the News on clean energy. In spite of Solyndra and others, the White House continues to push "clean energy". The latest comment is that we must keep up with the rest of the world.
"Clean energy" are the buzzwords of the Obama Administration for anything that does not release CO2 in its final use. They mean wind and solar energy. The Administration doesn't want to talk about nuclear energy.
If you do the math, one of the problems is that one can't get more than about 10% of our energy needs from wind and solar, even with extensive commercial development. In addition, wind and solar are considerably less efficient dollarwise than using fossil fuels in our traditional generation of electricity from coal burning power plants and the use of gasoline in automotive vehicles.
Why the condemnation of CO2 as a bad actor? There are no data to show that it is detrimental to the environment. In fact, CO2 in air is a raw material source for plant growth.
I strongly suspect that ideology and taxation are behind the Administration's continuing push for clean energy. If the US follows the "clean energy" program, it will be operating an industrial economy at considerably less efficiency, than there would be with use of fossil tools. This would then put the US economy at a level more equal to Third World countries, which is one of the objectives of Marxists ideology.
The Obama Administration is using a twofold approach; throw taxpayer money at the development of inefficient energy processes and simultaneously inhibit production and use of fossil fuels. Inhibition of fossil fuel production has been demonstrated in the continued withholding of oil drilling permits from drilling companies, and the recent postponement (killing) of the Canadian oil pipeline to the Gulf Coast.
Postponement/killing of the Canadian oil pipeline project also does not make available thousands of US jobs for its construction. More importantly, it tends to maintain oil and its associated products, such as gasoline, at high prices. The US labor force is high priced compared to labor forces in most other developed countries, which is why much manufacturing has gone from the United States to those other countries. However, a little noticed fact is that with use of cheap energy, high-priced American labor could actually be more efficient (lower cost) than third country labor.
Randy, we have an opportunity to get the US economy back on track, but it will involve fighting a misplaced ideology of the Obama Administration. Please do your best.
Randy,
More talk in the News on clean energy. In spite of Solyndra and others, the White House continues to push "clean energy". The latest comment is that we must keep up with the rest of the world.
"Clean energy" are the buzzwords of the Obama Administration for anything that does not release CO2 in its final use. They mean wind and solar energy. The Administration doesn't want to talk about nuclear energy.
If you do the math, one of the problems is that one can't get more than about 10% of our energy needs from wind and solar, even with extensive commercial development. In addition, wind and solar are considerably less efficient dollarwise than using fossil fuels in our traditional generation of electricity from coal burning power plants and the use of gasoline in automotive vehicles.
Why the condemnation of CO2 as a bad actor? There are no data to show that it is detrimental to the environment. In fact, CO2 in air is a raw material source for plant growth.
I strongly suspect that ideology and taxation are behind the Administration's continuing push for clean energy. If the US follows the "clean energy" program, it will be operating an industrial economy at considerably less efficiency, than there would be with use of fossil tools. This would then put the US economy at a level more equal to Third World countries, which is one of the objectives of Marxists ideology.
The Obama Administration is using a twofold approach; throw taxpayer money at the development of inefficient energy processes and simultaneously inhibit production and use of fossil fuels. Inhibition of fossil fuel production has been demonstrated in the continued withholding of oil drilling permits from drilling companies, and the recent postponement (killing) of the Canadian oil pipeline to the Gulf Coast.
Postponement/killing of the Canadian oil pipeline project also does not make available thousands of US jobs for its construction. More importantly, it tends to maintain oil and its associated products, such as gasoline, at high prices. The US labor force is high priced compared to labor forces in most other developed countries, which is why much manufacturing has gone from the United States to those other countries. However, a little noticed fact is that with use of cheap energy, high-priced American labor could actually be more efficient (lower cost) than third country labor.
Randy, we have an opportunity to get the US economy back on track, but it will involve fighting a misplaced ideology of the Obama Administration. Please do your best.
Tuesday, November 29, 2011
EPA Has Control Power of Plant Emissions but Must Use Discretion
Open e-mail to Rep. Neugebauer:
Randy,
As you know from my previous e-mails, I'm not a big supporter of the EPA and Democratic (socialistic) philosophy. However, Democrats and even Pres. Obama will occasionally do something right.
According to C&E News, there was a recent effort in the Senate to allow only the states to control emissions from coal-burning electricity generating power plants. The present EPA regulation involves national control. The measure attempting to revert back to state control was defeated, which is a good thing.
The fact is that gaseous and particulate emissions of coal-burning power plants do cross state lines, and therefore are a National problem, rather than a State problem.
In addition, we know from previous experience that at least some emissions of coal-burning power plants are significantly detrimental to the environment. Some years ago, the Northeast was particularly affected by acid rain, which significantly increased the acidity of lakes and ponds. The acidity changed the floriculture of these water reservoirs and in many cases was detrimental to fish population. Actual monetary harm to the economy was probably negligible, but most people believe that we have an obligation to preserve the natural environment, wherever possible, and within the limits of economic good sense.
The acid rain problem was technically traced to sulfur contamination in coal being burned in the power plants. The sulfur contaminant burned to give gaseous sulfur dioxide. The sulfur dioxide later oxidized in the atmosphere to sulfur trioxide, which in turn reacted with rainwater to form sulfuric acid. It was the sulfuric acid content of rainwater which caused the environmental change. The problem was resolved by reducing the sulfur content of coal burned at the power plants. We hear no more about acid rain.
The likelihood is that some sulfur is still being burned in power plants leading to sulfuric acid, but the concentration is now so low as to basically alleviate the acid rain problem. The key point here is not only recognizing emission contaminants potentially detrimental to the environment, but also recognizing concentrations that actually do damage.
The accent on power plant emissions at present involves sulfur dioxide, carbon dioxide, nitrogen oxides, and mercury.
We have experience to know that sulfur dioxide is a detrimental environmental contaminant, which concentration must be controlled to a non-detrimental level.
Carbon dioxide has become a political football for purposes of redistribution of wealth through taxation. It is a natural constituent of the atmosphere, and there is no data to show that even significant increases in concentration are detrimental to the environment.
NOx is a mixture of NO and NO2. One of these gases has been traced to further atmospheric reaction to form ozone, which is environmentally protective at high atmospheric levels, but detrimental to humans at ground-level. In addition to human toxicity, it is generally considered to be involved in smog formation. There is some justification for control of NOx from power plants. The question remains as to what is a reasonable level of permissible concentration, where there is no obviously significant damage. It is also possible that power plants can install catalytic systems to reduce NOx concentrations. This has already been accomplished in automotive vehicles. It will cost the power plants to install such catalytic equipment, and the cost will be transferred to increased electricity cost for the consumer. There is a level of justification, but it should not be overdone.
I have previously written about mercury emission. Mercury in the atmosphere is brought to ground level by rain. In swampy areas, microbiological action converts the mercury to methylmercury, which is toxic to humans and wildlife. However, note that the conversion to methylmercury is only applicable to a very limited ground area, and even in that area, we have not noticed detriment to the environment. In effect, there is no significant case for controlling mercury emissions. For those who still have doubt, we could justify spending a little money on research.
Randy,
As you know from my previous e-mails, I'm not a big supporter of the EPA and Democratic (socialistic) philosophy. However, Democrats and even Pres. Obama will occasionally do something right.
According to C&E News, there was a recent effort in the Senate to allow only the states to control emissions from coal-burning electricity generating power plants. The present EPA regulation involves national control. The measure attempting to revert back to state control was defeated, which is a good thing.
The fact is that gaseous and particulate emissions of coal-burning power plants do cross state lines, and therefore are a National problem, rather than a State problem.
In addition, we know from previous experience that at least some emissions of coal-burning power plants are significantly detrimental to the environment. Some years ago, the Northeast was particularly affected by acid rain, which significantly increased the acidity of lakes and ponds. The acidity changed the floriculture of these water reservoirs and in many cases was detrimental to fish population. Actual monetary harm to the economy was probably negligible, but most people believe that we have an obligation to preserve the natural environment, wherever possible, and within the limits of economic good sense.
The acid rain problem was technically traced to sulfur contamination in coal being burned in the power plants. The sulfur contaminant burned to give gaseous sulfur dioxide. The sulfur dioxide later oxidized in the atmosphere to sulfur trioxide, which in turn reacted with rainwater to form sulfuric acid. It was the sulfuric acid content of rainwater which caused the environmental change. The problem was resolved by reducing the sulfur content of coal burned at the power plants. We hear no more about acid rain.
The likelihood is that some sulfur is still being burned in power plants leading to sulfuric acid, but the concentration is now so low as to basically alleviate the acid rain problem. The key point here is not only recognizing emission contaminants potentially detrimental to the environment, but also recognizing concentrations that actually do damage.
The accent on power plant emissions at present involves sulfur dioxide, carbon dioxide, nitrogen oxides, and mercury.
We have experience to know that sulfur dioxide is a detrimental environmental contaminant, which concentration must be controlled to a non-detrimental level.
Carbon dioxide has become a political football for purposes of redistribution of wealth through taxation. It is a natural constituent of the atmosphere, and there is no data to show that even significant increases in concentration are detrimental to the environment.
NOx is a mixture of NO and NO2. One of these gases has been traced to further atmospheric reaction to form ozone, which is environmentally protective at high atmospheric levels, but detrimental to humans at ground-level. In addition to human toxicity, it is generally considered to be involved in smog formation. There is some justification for control of NOx from power plants. The question remains as to what is a reasonable level of permissible concentration, where there is no obviously significant damage. It is also possible that power plants can install catalytic systems to reduce NOx concentrations. This has already been accomplished in automotive vehicles. It will cost the power plants to install such catalytic equipment, and the cost will be transferred to increased electricity cost for the consumer. There is a level of justification, but it should not be overdone.
I have previously written about mercury emission. Mercury in the atmosphere is brought to ground level by rain. In swampy areas, microbiological action converts the mercury to methylmercury, which is toxic to humans and wildlife. However, note that the conversion to methylmercury is only applicable to a very limited ground area, and even in that area, we have not noticed detriment to the environment. In effect, there is no significant case for controlling mercury emissions. For those who still have doubt, we could justify spending a little money on research.
Monday, November 14, 2011
Congress Must Move on Canada-US Oil Pipeline
E-mail to Rep.Neugebauer:
Pres. Obama has just scuttled the proposed oil pipeline from Canada to the US. The expected advantages to the US were a large number of US construction jobs and availability of low-priced oil in the US.
Why would Pres. Obama scuttle such an obviously advantageous program? There are several considerations, all of which are of importance to Pres. Obama. A low crude oil price in the US would give lower gasoline prices. This would be disadvantageous to Pres. Obama's personal program of converting the automobile industry into electric vehicles. Low-cost energy would foster the general economy of the US. This could be disadvantageous to Pres. Obama's program to redistribute wealth globally. We have previously pointed out that environmental groups in the US have been taken over by Communists, who also support global redistribution of wealth. Environmentalists are also large contributors to Pres. Obama's reelection campaign. Environmentalists use devious mechanisms, such as spotted owls, snail darters, and now possible contamination of aquifers in order to stymie any economic growth in the US.
In scuttling the pipeline proposal, Pres. Obama only indicated a postponement. However, the Canadians realistically said they would follow a different route of oil export to China. Once that is set up, the US will be on the outside looking in.
As implied above, Pres. Obama's stated excuse was possible contamination of a drinking water aquifer. An aquifer is an underground layer of permeable rock, gravel, sand, or silt which can contain and through which water can flow. For example, Lubbock is at the terminus of the Ogallala aquifer, which originates in Colorado and allows water to flow underground from melting snows and rains in Colorado. There is no such thing as a drinking water aquifer. Aquifers can become contaminated with pollutants, similar to what can happen in lakes and streams, but usually the aquifer size is so great that pollution is generally insignificant. In addition, the underground layer of permeable rock etc. is usually so broad, in relation to the diameter of a pipeline, that even a burst pipeline would have little effect on aquifer contamination. This is especially true when it would be obvious to pipeline operators that not repairing a significant pipeline leak will cost them a significant loss in oil revenue. Another comparison is that even in the design of the human body, a potential pollutant pipeline in the form of intestine passes through areas close to vital organs, such as heart, kidneys etc. without difficulty.
For various reasons, Pres. Obama has scuttled this pipeline. It may not be too late to resurrect it, but the longer we wait, the more difficult will be a reversal. Congress should not accept this obvious opportunity to increase jobs and improve the general economy of the US. Congress should take some action now, against Pres. Obama and the Department of Energy or whichever agency is ostensibly responsible for this atrocity.
..
Pres. Obama has just scuttled the proposed oil pipeline from Canada to the US. The expected advantages to the US were a large number of US construction jobs and availability of low-priced oil in the US.
Why would Pres. Obama scuttle such an obviously advantageous program? There are several considerations, all of which are of importance to Pres. Obama. A low crude oil price in the US would give lower gasoline prices. This would be disadvantageous to Pres. Obama's personal program of converting the automobile industry into electric vehicles. Low-cost energy would foster the general economy of the US. This could be disadvantageous to Pres. Obama's program to redistribute wealth globally. We have previously pointed out that environmental groups in the US have been taken over by Communists, who also support global redistribution of wealth. Environmentalists are also large contributors to Pres. Obama's reelection campaign. Environmentalists use devious mechanisms, such as spotted owls, snail darters, and now possible contamination of aquifers in order to stymie any economic growth in the US.
In scuttling the pipeline proposal, Pres. Obama only indicated a postponement. However, the Canadians realistically said they would follow a different route of oil export to China. Once that is set up, the US will be on the outside looking in.
As implied above, Pres. Obama's stated excuse was possible contamination of a drinking water aquifer. An aquifer is an underground layer of permeable rock, gravel, sand, or silt which can contain and through which water can flow. For example, Lubbock is at the terminus of the Ogallala aquifer, which originates in Colorado and allows water to flow underground from melting snows and rains in Colorado. There is no such thing as a drinking water aquifer. Aquifers can become contaminated with pollutants, similar to what can happen in lakes and streams, but usually the aquifer size is so great that pollution is generally insignificant. In addition, the underground layer of permeable rock etc. is usually so broad, in relation to the diameter of a pipeline, that even a burst pipeline would have little effect on aquifer contamination. This is especially true when it would be obvious to pipeline operators that not repairing a significant pipeline leak will cost them a significant loss in oil revenue. Another comparison is that even in the design of the human body, a potential pollutant pipeline in the form of intestine passes through areas close to vital organs, such as heart, kidneys etc. without difficulty.
For various reasons, Pres. Obama has scuttled this pipeline. It may not be too late to resurrect it, but the longer we wait, the more difficult will be a reversal. Congress should not accept this obvious opportunity to increase jobs and improve the general economy of the US. Congress should take some action now, against Pres. Obama and the Department of Energy or whichever agency is ostensibly responsible for this atrocity.
..
Monday, November 7, 2011
Repeal the Energy Policy Act of 2005 and the Energy Independence & Security Act of 2007.
Open e-mail to Rep. Neugebauer:
Randy,
On October 27, 2011, I e-mailed you asking that you energize the Congress to repeal the Energy Policy Act of 2005 and the Energy Independence & Security Act of 2007. They were ill conceived originally. They involve unnecessary government subsidies, which we cannot afford, and contain restrictions on private business development.
I now present additional information, which supports this position. Another way to look at it is that, in establishing the two Acts, Congress did not take into consideration the power of subsequent technology development from existing private industry. I refer specifically to the ethanol provisions of the two Acts, which mandates ethanol use in motor fuels, even though gasoline is less expensive on the market.
The ideal fuel for motor vehicles is liquid form, which can be carried and enable the vehicle to have an operating range of several hundred miles. Gasoline admirably satisfies this requirement. Electricity and natural gas have enough deficiencies that they are not competitive. However, other liquid fuels might also be acceptable, including ethanol. But again, we need to consider price and availability.
In the October 24 issue of Chemical and Engineering News, there is an article by Alexander Tullo entitled, "Celanese Takes an Ethanol Plunge".
We have in the US tremendous coal reserves. It has been a long-standing objective of the chemical industry to convert coal to a liquid fuel for automotive use. Several processes have been developed, but none of these have met the cost requirements to compete with gasoline. However, Celanese now claims to be able to do this.
In order to analyze whether Celanese really has something, we need to be first concerned with measurement. Since petroleum is a prevalent energy source, it has been convenient to relate any other sources to petroleum. In their announcement, Celanese has used figures involving Barrel of Oil Equivalents (BOEs), but most liquids are sold on a per gallon basis. First, we need to understand a BOE and second, we need to be able to convert $ / BOE to $ / gallon.
A standard petroleum barrel contains 42 US gallons. Inherent in the barrel of oil is a quantity of available energy, which is 5,800,000 British Thermal Units (BTUs). Other fuels may then be calculated for their energy contents relating to the energy content of a barrel of oil. The term is a "Barrel of Oil Equivalent", or a BOE. Therefore, if I want a comparative prices of alternative fuels, I can compare their BOE prices with the price of an actual barrel of oil. However, a fixed barrel volume is only applicable to 42 gallons of petroleum. BOEs for other fuels are not true barrels. For example, gasoline has an energy content of 125,000 BTUs per gallon. To have the same quantity of energy as a barrel of crude oil, 46.4 gallons (5,800,000 / 125,000) are required. The BOE for gasoline is then, 46.4 gallons, not 42 gallons
In its announcement of the a low-cost route to ethanol from coal, Celanese has forecast that, with its new TCX Process, it could produce ethanol at a selling price (not cost) of $60 per BOE. For comparison, Celanese said that petroleum and corn fermented ethanol were both selling at $100 per BOE. A check of the market prices confirmed the price of $100 per barrel of crude oil, which is the same as the BOE. There is no reported price for a BOE of ethanol, but spot price at Chicago is $1.68/ gallon
The above figures are not really comparable, because they do not take into account differences in taxes and subsidies. In addition, crude oil cannot be used directly in automotive vehicles, while ethanol can be used directly, even if only at low rates of mixing with gasoline. Therefore, we need adjustments to obtain comparable figures. These adjustments have been made in the attachment.
The net result is that gasoline price at the refinery is $2.39 per gallon. Corn fermented ethanol, when corrected for subsidy and less energy content as compared to gasoline is $3.60 per gallon. It makes no sense to use corn fermented ethanol as a motor fuel, especially when we have ample reserves of crude oil, which can be tapped and refined to gasoline. Note also that even with the giveaway of a $.51 gal subsidy, corn fermented ethanol costs $3.09 per gallon, compared to gasoline at $2.39 per gallon.
Finally, Celanese's TCX ethanol looks to be cheaper than gasoline on a comparable energy basis ($1.30 per gallon versus $2.39). We can be hopeful that it will come to realization, but it is presently pie-in-the-sky. There are also two other disadvantages. Automotive vehicles are now constructed to only be able to use a blend of ethanol with gasoline. This could be solved to allow complete ethanol use, but likely at considerable cost to vehicle modification. In addition, the lower energy content of ethanol versus gasoline will reduce the driving range, unless there is an increase in carrying capacity.
Randy, we go back to the start. Congress must repeal the Energy Policy Act of 2005 and the Energy Independence & Security Act of 2007.
Ref: http://www.eia.gov/oog/info/gdu/gasdiesel.asp
Randy,
On October 27, 2011, I e-mailed you asking that you energize the Congress to repeal the Energy Policy Act of 2005 and the Energy Independence & Security Act of 2007. They were ill conceived originally. They involve unnecessary government subsidies, which we cannot afford, and contain restrictions on private business development.
I now present additional information, which supports this position. Another way to look at it is that, in establishing the two Acts, Congress did not take into consideration the power of subsequent technology development from existing private industry. I refer specifically to the ethanol provisions of the two Acts, which mandates ethanol use in motor fuels, even though gasoline is less expensive on the market.
The ideal fuel for motor vehicles is liquid form, which can be carried and enable the vehicle to have an operating range of several hundred miles. Gasoline admirably satisfies this requirement. Electricity and natural gas have enough deficiencies that they are not competitive. However, other liquid fuels might also be acceptable, including ethanol. But again, we need to consider price and availability.
In the October 24 issue of Chemical and Engineering News, there is an article by Alexander Tullo entitled, "Celanese Takes an Ethanol Plunge".
We have in the US tremendous coal reserves. It has been a long-standing objective of the chemical industry to convert coal to a liquid fuel for automotive use. Several processes have been developed, but none of these have met the cost requirements to compete with gasoline. However, Celanese now claims to be able to do this.
In order to analyze whether Celanese really has something, we need to be first concerned with measurement. Since petroleum is a prevalent energy source, it has been convenient to relate any other sources to petroleum. In their announcement, Celanese has used figures involving Barrel of Oil Equivalents (BOEs), but most liquids are sold on a per gallon basis. First, we need to understand a BOE and second, we need to be able to convert $ / BOE to $ / gallon.
A standard petroleum barrel contains 42 US gallons. Inherent in the barrel of oil is a quantity of available energy, which is 5,800,000 British Thermal Units (BTUs). Other fuels may then be calculated for their energy contents relating to the energy content of a barrel of oil. The term is a "Barrel of Oil Equivalent", or a BOE. Therefore, if I want a comparative prices of alternative fuels, I can compare their BOE prices with the price of an actual barrel of oil. However, a fixed barrel volume is only applicable to 42 gallons of petroleum. BOEs for other fuels are not true barrels. For example, gasoline has an energy content of 125,000 BTUs per gallon. To have the same quantity of energy as a barrel of crude oil, 46.4 gallons (5,800,000 / 125,000) are required. The BOE for gasoline is then, 46.4 gallons, not 42 gallons
In its announcement of the a low-cost route to ethanol from coal, Celanese has forecast that, with its new TCX Process, it could produce ethanol at a selling price (not cost) of $60 per BOE. For comparison, Celanese said that petroleum and corn fermented ethanol were both selling at $100 per BOE. A check of the market prices confirmed the price of $100 per barrel of crude oil, which is the same as the BOE. There is no reported price for a BOE of ethanol, but spot price at Chicago is $1.68/ gallon
The above figures are not really comparable, because they do not take into account differences in taxes and subsidies. In addition, crude oil cannot be used directly in automotive vehicles, while ethanol can be used directly, even if only at low rates of mixing with gasoline. Therefore, we need adjustments to obtain comparable figures. These adjustments have been made in the attachment.
The net result is that gasoline price at the refinery is $2.39 per gallon. Corn fermented ethanol, when corrected for subsidy and less energy content as compared to gasoline is $3.60 per gallon. It makes no sense to use corn fermented ethanol as a motor fuel, especially when we have ample reserves of crude oil, which can be tapped and refined to gasoline. Note also that even with the giveaway of a $.51 gal subsidy, corn fermented ethanol costs $3.09 per gallon, compared to gasoline at $2.39 per gallon.
Finally, Celanese's TCX ethanol looks to be cheaper than gasoline on a comparable energy basis ($1.30 per gallon versus $2.39). We can be hopeful that it will come to realization, but it is presently pie-in-the-sky. There are also two other disadvantages. Automotive vehicles are now constructed to only be able to use a blend of ethanol with gasoline. This could be solved to allow complete ethanol use, but likely at considerable cost to vehicle modification. In addition, the lower energy content of ethanol versus gasoline will reduce the driving range, unless there is an increase in carrying capacity.
Randy, we go back to the start. Congress must repeal the Energy Policy Act of 2005 and the Energy Independence & Security Act of 2007.
Ref: http://www.eia.gov/oog/info/gdu/gasdiesel.asp
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