Friday, June 10, 2011

MIT Study: Climate Policy Must Destroy the World to Save It


According to an MIT study, the conversion of coal to liquid fuels via gasification and Fischer Tropsch, has great potential for clean and economical replacement of petroleum fuels, as the price of oil edges higher. Unless, that is, a global climate policy is in place -- which will force additional costs to the technology so as to make it uneconomical.
Coal-to-liquid technology has been in existence since the 1920s and was used extensively in Germany in 1944, producing around 90 percent of the national fuel needs at that time. Since then, the technology has been largely abandoned for the relatively cheaper crude oil of the Middle East. A notable exception is South Africa, where CTL conversion still provides about 30 percent of national transportation fuel.

But will there be a resurgence of CTL technology? To determine the role that CTL conversion would play in the future global fuel mix, researchers examined several crucial factors affecting CTL prospects. Different scenarios were modeled, varying the stringency of future carbon policies, the availability of biofuels and the ability to trade carbon allowances on an international market. Researchers also examined whether CTL-conversion plants would use carbon capture and storage technology, which would lower greenhouse gas emissions but create an added cost.

The study found that, without climate policy, CTL might become economical as early as 2015 in coal-abundant countries like the United States and China. In other regions, CTL could become economical by 2020 or 2025. Carbon capture and storage technologies would not be used, as they would raise costs. In this scenario, CTL has the potential to account for about a third of the global liquid-fuel supply by 2050.

However, the viability of CTL would be highly limited in regions that adopt climate policies, especially if low-carbon biofuels are available. Under scenarios that include stringent future climate policies, the high costs associated with a large carbon footprint would diminish CTL prospects, even with carbon capture and storage technologies. CTL conversion may only be viable in countries with less stringent climate policies or where low-carbon fuel alternatives are not available. _MIT_via_GCC
MIT study PDF 512 KB

In other words, costs for energy are likely to be driven far higher with top-down carbon penalties than with more market-oriented energy policies. Given the rather shaky nature of global economic regimes, the pursuit of expensive carbon penalties is apt to depress global trade and western economies beyond the current troubles.

Climate change science has been forced to backpedal on a number of over-wrought alarmist claims recently, and has had its nose rubbed in some rather unsavoury insider activity as a result of the public release of a number of emails between some rather unscrupulous climate scientists (ClimateGate).

It would be a shame to discover that world economies had been subjected to ruinously expensive carbon policies which were based on nothing more than sham science. And yet, such may well be the case.

More: A single but dramatic example of the destructive impact of Obama's EPA climate regulations on US energy supply These governmental and inter-governmental bureaucrats of the faux environmentalist persuasion do not care how many lives or enterprises they destroy. Still, you cannot claim that Obama did not give fair warning of what he planned to do. The promise of energy starvation is one that he aims to keep, and damn the costs.

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Blogger Scott said...

If you include biofuels in the mix in the top graph, this would also have a greater positive impact on the supply of liquid fuels.

I do think however that carbon taxes are just another revenue generator. The UK Fuel Duty Escalator being a classic example (which explains why we pay $8 - $9 per US gallon for petrol and diesel)

1:13 AM  
Blogger al fin said...


The MIT study assumes that the costs of CTL will be so low without carbon capture as to push most biofuels out of the contest.

But that is an assumption that is not likely to be true across the entire spectrum of biofuels technologies in the year 2015 -- much less 2050.

8:47 AM  

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