Thursday, May 31, 2012

Germany's Agenda of Energy Starvation Could not Happen at a Worse Time for European Economies

Germany is proceeding along a path that puts it at greater and greater risk of potentially catastrophic power blackouts.

German Chancellor Angela Merkel is unrepentant -- and almost boastful -- over her energy plan which commits Germany to invest at least $25 billion to upgrade its power grid. The German grid is the power hub of Europe -- if it fails, Europe's grid fails.

The high cost of upgrades to the power grid could not come at a worse time for Germany or Europe, already stressed by a banking crisis. But the $25 billion or $30 billion needed to improve the grid systems is only the barest down payment toward the ultimate costs of Merkel's suicidal energy decisions.

Germany is phasing out its nuclear power plants and attempting to replace its infrastructure of baseload power generation with big wind and big solar installations. Germany publicly hopes to provide as much as 50% of its electrical power from wind and solar within the next few decades.

Unfortunately, large power grids grow unstable when big wind and big solar -- intermittent unreliables -- attempt to provide more than 20% of overall power. Going far beyond that level of dependency on intermittent unreliables would place the German gird -- and thus the European grid -- in an untenable position.
More information
A look at Denmark's unfortunate experience with wind energy (PDF)

Spain was once caught up in the green fantasy of the intermittent unreliables, just like Merkel's Germany. But Spain was forced to admit that it could not afford the green fantasy any longer. Eventually, Germany will be forced to come to the same conclusion. The only question is the price that the German people will have to pay for the stubborn stupidity of its leaders.

Greens are reluctant to admit the problems which intermittent unreliables pose for grid stability, particularly the higher the levels of penetration of the intermittent unreliable sources. But the truth will come out in the most painful ways, and many people will remember who has led them to suffer unnecessarily.

Europe is undergoing a demographic implosion, which is putting increasing -- although still subtle -- pressures on the ability of European nations to maintain technological infrastructures and to pay back large debts. If Europe goes through with this suicidal abandonment of reliable power sources in favour of the intermittent unreliables -- and goes even more deeply in debt in the process -- future generations of Europeans will pay the the price.

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Wednesday, May 30, 2012

A Bullish Look at Future Oil Prices from Gerald Bailey

Dr. Bailey has 48 years in the petroleum industry with extensive engineering, management and senior assignments. He has experience in all aspects of the industry both upstream and downstream, with particular Middle East skills, along with US onshore and offshore. Bailey is retired from Exxon (NYSE: XOM), lastly as President, Exxon Arabian Gulf, where he was responsible for all Exxon business interests in the Arabian Gulf region. _PRNewswire
Gerald Bailey has devoted 48 years to the oil business, and is currently chairman of the Vanguard Energy Corp. He expects demand for oil to continue to go up, and for oil prices to rise along with demand.

An old oil hand, Dr. Bailey is not a believer in "peak oil," much less peak oil doom. But he acknowledges that most newly discovered oil deposits are likely to be more difficult and expensive to develop and produce, than oil fields developed in decades past.

Of course, the monetary policies of the US government have much to do with the current oil price bubble in US dollars. The less the US dollar is worth, the higher the price of oil in dollars is likely to rise.

And while "speculators" do not drive oil prices over the long term, in the short term powerful inside trading groups -- including sovereign oil funds and state connected investment firms -- can do a lot to influence the price of oil temporarily.

At this time, most intelligent analysts have their eyes focused on the BRICs (as well as the shaky Eurozone), and are considering how the volatile fortunes of these emerging nations (and nations in a banking crisis) might influence demand for commodities -- and thus influence their prices.

Anyone who expects global prices (and global demand) to rise monotonically is in danger of economic loss, should they wager too much on such expectations.


Tuesday, May 29, 2012

Russia's Dysfunctional Economy Hurts Its Energy Sector

Russia is a difficult country to analyse. It is the largest nation on Earth, rich in natural resources and human resources. And yet it is burdened with dysfunctional government, a dysfunctional economic and legal system, and an atmosphere of vague despair that lingers despite multiple changes in leadership over the decades.
The Russian market this spring fell faster than other so-called BRIC countries of Brazil, Russia, India and China and since mid-March is down 18.8 percent. Global oil prices have slumped, reducing expected earnings.

But even taking earnings into account, investors take a dim view of Russian equities. The Russian stock exchange now trades at an average price to estimated earnings ratio of 4.28, compared with the MSCI Emerging-Markets Index average.

It is a glum statistic for Russia, particularly as President Vladimir V. Putin is planning a wide-ranging sale of state assets to raise money for increased military and social spending promised during his campaign. The price-to-earnings ratio comparison means that, statistically, a company that mines gold or pumps oil in Russia is worth less than half as much as a company that extracts the same amount of gold or oil just as efficiently in Brazil or Indonesia.

For all the value in the Russian economy, this wealthy industrial superpower cannot convince investors that it is safe place to put money — even an oil company is a hard sell. _NYT
No wonder. When wealthy Russia cannot convince insurance companies to insure joint projects inside Russia, of course it will not be able to convince most investors to take the huge risks of exposing valuable assets to the kleptocratic Russian bear. The Russian government treats all assets -- public or private -- as its own little treasure chest of goodies.
Sergei Aleksashenko, a former deputy finance minister, said in an interview that Russian energy companies are routinely subjected to this “system of unofficial requests,” from the Kremlin — for financing everything from presidential palaces to ski resorts to military installations.

“It doesn’t really matter what it is for,” Mr. Aleksashenko said. “You receive a request and you cannot refuse.” _NYT
Mr. Putin and his friends have their fingers in all the concentrations of wealth and power inside the country. The corruption takes place overtly and covertly, legally and quasi-illegally. It is organised crime on a massive scale, and shows no sign of being curtailed -- particularly as long as weak and inept clowns such as US President Obama are in charge of the western bloc.
Based in the Siberian city of the same name, Surgut is a private company but managed by a Soviet-era director who is close to Mr. Putin. It sells much of its oil, about $127 million a day based on average prices for Russia’s export blend oil, Ural Crude, last year, to a similarly opaque commodities firm called Gunvor based in the Netherlands and co-owned by Gennady Timchenko, another longtime acquaintance of Mr. Putin.

The company has emphasized other measures of success than stock price, including high salaries for employees and a favored statistic of Soviet oil ministers but not modern petroleum analysts: the number of meters of well bore drilled. Surgut has yet to publish its 2011 annual financial report on its Web site but, in a press statement, made public that it had drilled 4.75 million meters last year.

The owners of 70 percent of the company remain a mystery. In conference calls with analysts, the company has said its own executives own a majority of the shares... _NYT
More at link above.

Russia is undergoing a demographic collapse of its core population. The country is a public health disaster. Its military and military-industrial infrastructures are rusting and crumbling under the weight of corruption, neglect, and nepotistic incompetence. And Russia's energy infrastructure -- desperately in need of foreign capital and expertise -- is going the same way of slow motion collapse. Unless something of significance changes.

Stay tuned.

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Friday, May 25, 2012

China Slows, Russia Hurts: Cause and Effect?

The New York Times finally stumbles on a relevant news story: China's economy begins to slow. To most of us who have been paying attention, this is not exactly news. And some of us have even suggested that when China's economy slowed, leading to a reduction in demand for commodities, that some of the commodities - supplying countries such as Russia might feel the pinch.

Russia's government requires very high pricing for both oil & gas in order to finance President Putin's ambitious quest to re-build the USSR in everything but name. But with global oil prices slumping -- and the prospects for a significant dive in gas prices over the next several years -- Russia is being slapped in the face with a cold and bracing bucketful of reality.

More on Russia's acute problem of capital flight:
"There is large-scale capital flight from Russia, despite the economic recovery," Dmitriev said. "And this capital is flying into the epicenter of the global financial crisis, which is in Europe. That is actually the same as creating a food supply in the center of an atomic explosion."

...Russia, which relies on oil and gas exports for half of its budget revenue and Europe as a market for more than 50 percent of its exports, may suffer a worse recession than in 2009 if energy prices plunge, according to Dmitriev.

..."If these trends continue, we will see the escalation of political violence and repression on one hand, and the worst economic crisis on the other," said Dmitriev, a deputy economy minister from 2000 to 2004. "This may lead to Putin losing control and a chaotic political transformation." _SFGate

Neither news story on Russia's problems points toward the China slowdown as one of the causes of Russia's downturn, but China's share of the global commodities markets makes it absolutely certain that a downturn in the great dragon's economy would send shocks through the economies of most large exporting nations -- including the giant bear of Russia.

As several of Russia's important energy customers begin learning how to "make their own energy," using newer oil and gas extraction technologies developed in North America, the pain felt by the wounded bear -- already suffering a potentially fatal demographic crisis -- can only worsen.

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Thursday, May 24, 2012

Oil & Gas Boom Impacts Kansas

Despite the efforts of the US Obama administration to shut down the fracking US oil & gas explosion, new hot spots of fossil fuel prosperity continue popping up across the continental US. In this case, it is the flat and placid state of Kansas that is being impacted by the economic tsunami brought by shale oil & gas fracking and horizontal drilling.
Hundreds of workers seeking high-paying jobs are flocking to places like Harper County, which had resorted to paying people to live there because of its declining population. Businesses are coming back from the dead and a housing shortage has caused rents to triple.

Oil companies began exploring Southern Kansas over a year ago, seeing enormous potential in the area now that new technologies like horizontal drilling and fracking have made it possible to tap into the oil-rich Mississippian Limestone formation.

SandRidge Energy, which holds the most horizontal drilling permits in Kansas, estimates there are about 15 billion barrels of recoverable oil in this part of Kansas. The company plans to drill 130 wells in the state by the end of the year -- up from 10 last year. And its wells are hitting oil 100% of the time.

"[The oil companies] aren't hitting any dry spots," said Mike Lanie, economic development director of Harper County. "This is looking like it could be the largest economic impact in the state's history, and for many people in these small towns, this will be a blessing." _CNN_via_CarpeDiem
If the US can eject the suicidal energy starvationists from its highest levels of government, media, and academia, its future -- and that of the global economy at large -- will look much more assured.

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Tuesday, May 22, 2012

Westinghouse Pushing for $450 Million in DOE SMR Funding

A number of large nuclear and engineering firms are competing for US DOE funding for development and licensing of a US produced small modular nuclear fission reactor, that can be mass produced for rapid placement and power up. Westinghouse is attempting to join the frontrunners -- such as Babcock and Wilcox, NuScale / Fluor, etc. -- in the hope of achieving a headstart over all the others. The cost of licensing a new reactor in the US exceeds $250 million, and the first licensed factory-produced SMR is likely to achieve a huge advantage.

The Westinghouse SMR is a 225 MWe integral pressurized water reactor (PWR), with all primary components located inside of the reactor vessel. It utilizes passive safety systems and proven components, as well as modular construction techniques – all realized and already licensed in the nuclear industry-leading AP1000® reactor - to achieve the highest level of safety and reduced number of components required. Westinghouse believes that this proven approach will provide licensing, construction and operational certainty that no other SMR supplier can match with competitive economics.

...Department of Energy (DOE) SMR investment funds will be awarded to SMR projects that have the most potential and promise to be licensed by the Nuclear Regulatory Commission and achieve commercial operation by 2022. The cost-share agreements will span a five-year period and, subject to Congressional appropriations, provide a total investment of approximately $900 million, with at least 50 percent provided by private industry. Westinghouse submitted its application to the DOE last Friday, May 18, on behalf of the Ameren Missouri-led NexStart SMR Alliance. The addition of Electric Boat and Burns & McDonnell to the Westinghouse team will further support and provide additional confidence to the Westinghouse SMR Project in its pursuit of the DOE funding opportunity.

Burns & McDonnell, Missouri's oldest and largest engineering firm will provide architectural and engineering support to design the power systems of the class-leading 225 MWe Westinghouse SMR. The company's more than 110 years of experience with all generation types includes an expansive and broad wealth of knowledge and expertise in new plant design, existing plant upgrades, operating plant issues, and design and analysis of myriad complex systems.

Electric Boat has joined the Westinghouse-led team to provide modular design support, leveraging the expertise attained over more than 60 years of nuclear-powered submarine design and manufacturing to the benefit of commercial nuclear programs. Electric Boat's specialized expertise in modular design will facilitate the achievement of factory-build efficiencies never before seen in nuclear energy deployment. _PennEnergy


Monday, May 21, 2012

MIT's New Ceramic O2 Separation Membrane Kills Multiple Birds With One Stone

MIT researchers are investigating ceramic membranes as a way to reduce carbon dioxide emissions in powerplants. In their system, the air (red dots) that’s needed for combustion passes over a ceramic membrane (red layer). Only oxygen passes through the membrane, mixing with fuel (black and green dots) to produce a pure stream of carbon dioxide and water. After evaporating water, carbon dioxide can then be captured and stored. _MITNews

A new O2 separation membrane from MIT scientists, is being touted as a potential CO2 reduction breakthrough. But fortunately, in reality it is far more than just a masturbation aid for carbon hysterics. In reality, a cheap way of concentrating O2 in combustion chambres while eliminating N2, provides a powerful anti NOx tool while at the same time making combustion more efficient. In addition, by making it cheaper to sequester CO2 in purified form, it may also help create a lucrative market in large-scale, pure CO2 for a number of commercial purposes. More about the technology:
Now researchers at MIT are evaluating a system that efficiently eliminates nitrogen from the combustion process, delivering a pure stream of carbon dioxide after removing other combustion byproducts such as water and other gases. The centerpiece of the system is a ceramic membrane used to separate oxygen from air. Burning fuels in pure oxygen, as opposed to air — a process known as oxyfuel combustion — can yield a pure stream of carbon dioxide.

The researchers have built a small-scale reactor in their lab to test the membrane technology, and have begun establishing parameters for operating the membranes under the extreme conditions found inside a conventional powerplant. The group’s results will appear in the Journal of Membrane Sciences, and will be presented at the International Symposium on Combustion in August.

...The air we breathe is composed mainly of nitrogen (78 percent) and oxygen (21 percent). The typical process to separate oxygen from nitrogen involves a cryogenic unit that cools incoming air to a temperature sufficiently low to liquefy oxygen. While the freezing technique produces a pure stream of oxygen, the process is expensive and bulky, and consumes considerable energy, which may sap a plant’s power output.

Ghoniem says ceramic membranes that supply the oxygen needed for the combustion process may operate much more efficiently, using less energy to produce pure oxygen and ultimately capture carbon dioxide.

...The group is now gauging the system’s performance at various temperatures, pressures and fuel conditions using their laboratory setup. They have also designed a complex computational model to simulate how the system would work at a larger scale, in a powerplant. They’ve found that the flow of oxygen across the membrane depends on the membrane’s temperature: The higher its temperature on the combustion side of the system, the faster oxygen flows across the membrane, and the faster fuel burns. They also found that although the gas temperature may exceed what the material can tolerate, the gas flow acts to protect the membrane.

“We are learning enough about the system that if we want to scale it up and implement it in a powerplant, then it’s doable,” Ghoniem says. “These are obviously more complicated powerplants, requiring much higher-tech components, because they can much do more than what plants do now. We have to show that the [new] designs are durable, and then convince industry to take these ideas and use them.” _MITNews
In addition to use in large power plants, the technology may eventually be used in a wide range of smaller internal combustion engines, for improved combustion and reduced NOx emissions.

High volume purified CO2 can be sold in many markets, from oil & gas to foods to chemicals etc. And in the event of a new ice age, a controlled release of CO2 into the atmosphere might keep larger areas of the planet habitable -- although in reality the heat retaining properties of CO2 in the atmosphere are proving to be far less potent than the alarmists had predicted.


Saturday, May 19, 2012

The Face of the Green Doomer EcoFascist Cult?

Green doomer eco-fascist cultists all follow similar guidelines: Slash the human population of the planet, although they themselves are unwilling to go first.. Blame free markets and western civilisation for most of the world's problems. Eschew all viable forms of large-scale energy in favour of those which are exorbitantly expensive and innately unreliable. Hate advanced technology, and want to push the world toward primitive lifestyles and global poverty. They are essentially anti-individual and pro-collective.

Members of any doomer cult will recognise the litany, whether from the climate change catastrophe cult, the peak oil doomer cult, the overpopulation doom cult, the global pollution doom cult, the biodiversity doom cult, etc.

Here is more from one of the horses' mouths:

This is Finnish writer Pentti Linkola — a man who demands that the human population reduce its size to around 500 million and abandon modern technology and the pursuit of economic growth — in his own words.

He likens Earth today to an overflowing lifeboat:

What to do, when a ship carrying a hundred passengers suddenly capsizes and there is only one lifeboat? When the lifeboat is full, those who hate life will try to load it with more people and sink the lot. Those who love and respect life will take the ship’s axe and sever the extra hands that cling to the sides.

He sees America as the root of the problem:

The United States symbolises the worst ideologies in the world: growth and freedom.

He unapologetically advocates bloodthirsty dictatorship:

Any dictatorship would be better than modern democracy. There cannot be so incompetent a dictator that he would show more stupidity than a majority of the people. The best dictatorship would be one where lots of heads would roll and where government would prevent any economical growth .

We will have to learn from the history of revolutionary movements — the national socialists, the Finnish Stalinists, from the many stages of the Russian revolution, from the methods of the Red Brigades — and forget our narcissistic selves.

A fundamental, devastating error is to set up a political system based on desire. Society and life have been organized on the basis of what an individual wants, not on what is good for him or her.

As is often the way with extremist central planners Linkola believes he knows what is best for each and every individual, as well as society as a whole:

Just as only one out of 100,000 has the talent to be an engineer or an acrobat, only a few are those truly capable of managing the matters of a nation or mankind as a whole. In this time and this part of the World we are headlessly hanging on democracy and the parliamentary system, even though these are the most mindless and desperate experiments of mankind. In democratic coutries the destruction of nature and sum of ecological disasters has accumulated most. Our only hope lies in strong central government and uncompromising control of the individual citizen.

H/T Zerohedge

This fellow is not actually so extreme, for a green. He may be a bit more honest and open about his convictions than most, but that is changing. Even the WWF -- which has written many of the supporting "studies" for the IPCC climate change reports -- has come out in support of policies which would ultimately result in a large scale human dieoff.

Is this also the face of the peak oil doomer cult? Certainly you find a lot of peak oil cult wankers fixated on doom porn, compulsively getting their doom fix whenever possible. It would be easy to assume that they actually want to see suburbia burning, that they would like to see the end of civilisation as we know it.

Not that most of the incompetent athols would survive very long after such an event.

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Friday, May 18, 2012

Skilled Manpower Shortage Hurting Multiple Sectors of Industry Globally

From the US to Canada to Australia etc., multiple sectors of industry including transportation, manufacturing, energy, and mining, are being hurt and curtailed by the shortage of skilled workers.

This recent Zerohedge article looks at the looming problem within the oil production sector.
A separate study by the Petroleum Human Resources Council estimates about 39,000 workers will be needed in Canada alone to replace those who are expected to retire before 2020 just to maintain the status quo. The industry could need as many as 130,000 new hires by the end of the decade with more bullish oil and gas prices.

Already at least one analyst firm is scaling back its drilling activity forecast for 2012, in part because there aren't enough workers who can drill big, complicated wells. For now, NES Global Talent sees a depletion of skilled workers in oil and gas fields in the United States, Great Britain and Australia, three of the busiest oil and gas regions, will become a major problem.

Schlumberger, the largest oilfield services company in the world, sees significant negative effect from peak oil labor manifesting by 2015, a short three years from now, with increasing inexperienced oil professionals, and that the talent problem will only get worse.

For now, most forecasts expect crude prices would remain high in 2012, mostly due to the Iran tension. Meanwhile, OPEC just revised its 2012 world oil demand outlook slightly upwards citing a stable US economy and the shutdown of nuclear plants in Japan. So if the IMF prediction comes true, it seems the peak oil labor could be just enough to tip the scale for doubling in oil price scenario a lot sooner than year 2022.

The future will not be easy. _Zerohedge

Erratic government policies contribute significantly to the problem. When governments such as Japan and Germany arbitrarily decide to shut down a large industry such as nuclear power, what do they expect the skilled workers in that industry to do? And when later, these governments come running back with their tail between their legs, struggling to re-start the vital industry that they had earlier abandoned -- where will they find the skilled workers?

Arbitrary regulations and faux environmental policies in the coal, oil & gas, transportation, manufacturing, and mining sectors exact a similar cost from the future.

Finally, sky-high deficit spending along with high taxation make it difficult for young people to start families and raise children, while maintaining the quality of living to which they had grown accustomed in their own childhood. Governments are kicking the can of debt generations down the road, charging a demographic toll from future youth and adults which will not only exacerbate the skilled worker shortage, but will create an overall population shortage among all those who are not dependent upon welfare payments and government benefits.

This is the true peak, which actually represents multiple demographic peaks that are beginning to prove worrisome.

Welcome to the Idiocracy.


Crude Oil: Peak Demand 2020?

A small number of analysts forecast that oil production will start to fall by 2020 – not because we are running out, but because we just won’t need it. They argue that the world will wean itself off oil voluntarily, through major advances Peak oil will not be a supply-side phenomenon brought about by shrinking reserves...If they are right, this shift will start the long-term transition from oil to electricity as the main transport fuel, reduce economies’ vulnerability to spikes in the oil price, and cap greenhouse emissions from crude oil. _DavidStrahan

Strahan is thinking mainly about a shift from fossil fuel transportation to electricity powered transportation. Other people thinking along similar lines of "peak demand" expand the concept to total energy conservation leading to a drop in demand for oil.
A major plank in my golden age scenario for the 2020’s is the collapse of the cost of energy. This won’t occur because of a single big discovery, but from a 1,000 small ones that aggregate together to create a leveraged effect. The upshot is that we may be free of OPEC in 3-5 years, and completely energy independent not long after that. The impact on financial markets and global standards of living will be huge.

...Some 75% of the electricity generated powers buildings, three fourths of the oil fuels transportation, and the rest goes to industry. Demand for Texas tea is already falling dramatically. Since 1975, the amount of oil needed to produce a dollar of GDP has plunged a stunning 60%. Coal production peaked in 2005 and has since lost 25% of the market for power utilities, mostly to natural gas. “Peak oil” is becoming a reality, not in supply terms, but in demand. _madhedger

The mad hedger makes the mistake of expecting solar and wind to be part of the solution -- instead of a big part of the problem -- but nobody's perfect.

The common thread in the two articles is optimism over the prospects for energy conservation and conversion. But there are also grounds for optimism in terms of energy production.
Technology has allowed the industry to cut the cost of production, increase the volume of fossil fuels captured, reduce environmental impacts and reach previously inaccessible deposits of oil and natural gas.

Global reserves of oil and natural gas have grown 130 percent since 1980 and more than 30 percent since 2000, Pryor said.

New methods for extracting more oil and natural gas from the ground have been particularly important to growing production volumes, Pryor said.

The natural flow of oil from wells only accounts for 15 percent to 20 percent of the total volume produced today, he said. Easing the flow of fossil fuels using water, carbon dioxide and other methods can enhances production by as much as 25 percent.

“And now the combined application of horizontal drilling and fracking can add another 10 percent,” he said. “Each of these technology advances unlocks more resource and reserves.”

Deep-ocean drilling holds among the greatest promises for expanding oil and natural gas production, Pryor said. He noted that in the 1950s, the industry was limited to drilling in water depths less than 100 feet. Today, wells are being completed 10,000 feet below the ocean’s surface. _FuelFix

Of course there will be many more discoveries of new oil & gas fields -- both conventional and unconventional -- over the decades. And there will be significant progress in terms of other forms of energy production. After all, the current energy starvationist regimes controlling many western nations, cannot stay in power forever.

But what will make it "game over" for peak oil, is the perfection and licensing of HTGRs -- high temperature gas cooled reactors. The power of clean, cheap, abundant industrial process heat will be a game changer -- to say nothing of the abundant electrical power generation from safer, cleaner, more efficient new nuclear reactors.

One way or another, humans will reduce their use of conventional crude oil. But it is not likely to come about the way the doom-porn wankers of the peak oil catastrophe cult expect.


Thursday, May 17, 2012

Replacing Internal Combustion Engines

First let's look at a common and widespread industrial application for electric vehicles, and how manufacturers and owners eventually settled on a hybridised solution combining batteries with ultracapacitors, to successfully replace internal combustion engine performance in the short-range heavy duty vehicles.
Forklift manufacturers have tested out several technologies over the years in attempts to increase the efficiency of their vehicles. Their success was limited, and they have traditionally settled for batteries as the energy storage system of choice. However, batteries have proven to be less than satisfactory. They are energy dense but not power dense, and they have temperature and lifespan limitations that affect productivity. Increasingly, forklift manufacturers are adopting ultracapacitors in tandem with batteries. Ultracaps are power dense, but not energy dense, and they allow for a lower charge rate, enabling the application to operate at a lower temperature. The result of the ultracap-battery combination: longer lifespan and better performance.

Ultracaps also offer other benefits to forklift manufacturers and AGV owners. In an emergency situation, ultracaps provide enough energy for peak shaving, which lowers the power to a safe and manageable level. In full-crane operations, users need only four megawatts of ultracap banks. Ultracaps also increase the life of the batteries with which they partner; a 3,000 pound lead acid battery partnered with an ultracap can last up to four hours, when alone it would last only one hour. And finally, ultracaps have endured and successfully completed crash tests, meaning they are rugged enough for the nature of the work AGVs do.

Ultracapacitors are particularly useful in dynamic systems where applications perform several accelerations that last just a few seconds. These rapid movements, typical in AGVs, set the stage for energy recapture, which ultracapacitors excel at doing. The high-power and high-energy applications in the AGV market can benefit significantly from a hybridized solution of ultracapacitors and batteries, while seeing a payback on the ultracapacitor investment in just 18 months. _Environmental Leader
This solution will not be enough to replace internal combustion engines (ICEs) for on-road vehicles, due to their lack of range. To replace ICEs for on-road vehicles, a triple-hybrid solution might be best: fuel cells, batteries, and supercapacitors.
Internal Combustion Engines Best Single Power Source for Energy & Power Densities

It is impossible at this time for any single electrical power storage device to match the internal combustion engine for both power density and energy density, particularly when taking expense into account.
Comparing Fuel Cells, Batteries, and Supercapacitor Power Response

As you can see when comparing fuel cells, batteries, and supercapacitors, each has different strengths and weaknesses in terms of supplying power for acceleration, and in terms of storing energy for long range driving between recharge or refuel.
Specific Energy vs Specific Power for Fuel Cells, Batteries, and Capacitors

Energy Management for Fuel Cell - Battery - Supercapacitor Vehicle

This paper proposes a perfect energy source supplied by a polymer electrolyte membrane fuelcell (PEMFC) as a main power source and storage devices: battery and supercapacitor, for modern distributed generation system, particularly for future fuelcell vehicle applications. The energy in hybrid system is balanced by the dc bus voltage regulation. A supercapacitor module, as a high dynamic and high power density device, functions for supplying energy to regulate a dc bus voltage. A battery module, as a high energy density device, operates for supplying energy to a supercapacitor bank to keep it charged. A FC, as a slowest dynamic source in this system, functions to supply energy to a battery bank in order to keep it charged. Therefore, there are three voltage control loops: dc bus voltage regulated by a supercapacitor bank, supercapacitor voltage regulated by a battery bank, and battery voltage regulated by a FC. To authenticate the proposed control algorithm, a hardware system in our laboratory is realized by analog circuits and numerical calculation by dSPACE. Experimental results with small-scale devices (a PEMFC: 500-W, 50-A; a battery bank: 68-Ah, 24-V; and a supercapacitor bank: 292-F, 30-V, 500-A) corroborate the excellent control principle during motor drive cycle. _Abstract of Journal of Power Sources study

Fuzzy logic power management for fuel cell - battery - supercapacitor electric vehicle IEEE Vehicular Transactions

Some manufacturers are attempting to combine the battery and the ultracapacitor into a single device, and others are combining the two into a single sealed package. The advantage of combining the two devices for better total power and energy densities is clear. The addition of the fuel cell to provide much longer range -- providing for fully charged batteries and ultracaps over an extended time -- creates more expense and a more difficult technical challenge, but appears to be the only way of replacing the ICE ultimately.

A future invention which combines the functions of all three devices in one, is not out of the question, and is likely to reduce the cost of the all-electric powerplant eventually, when it can be manufactured as an integrated device.

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Wednesday, May 16, 2012

What if Peak Oil Died and Nobody Noticed?... and Other Energy Stories

A lot of hucksters are making a good living from peak oil doomerism. It has gotten to the point that it no longer matters whether peak oil has any intrinsic importance or not -- it is the symbolism of peak oil doom and devastation that matters. It is the catastrophic image inside the minds of the believers which drives the apocalyptic movement.

In the real world, things are not nearly so clear cut as in the mind of a cultist:
Apparently something terrible happens when we get to peak oil. I've never really quite understood the argument myself, but when we've used half of all the oil then civilisation collapses or something. I'm not sure why this should happen: we don't start starving when there's only half a loaf of bread left. But I am assured that something awful does happen.

That oil fields do get pumped out is obviously true – and also that you can have a good guess at when the ones we're currently pumping will run out. The part I don't get is the catastrophe. Some people seem to think that "peak oil" is when we can't actually pump out a higher amount: that if we've got 70 million barrels a day, then that's the most we can ever have, 70 million a day. Which is also called a disaster. Apparently this means that demand will move ahead of supply, which is simple sheer ignorance of the price system. There is no such thing as "supply" or "demand". There is only either of them at a price. So, if there really is a limit on how fast we can pump the stuff up, the price will rise.

Like it is at the moment. There's a lot more demand for $50-a-barrel oil than there is supply of it, which is why the price is $100 a barrel. It's true that if we really do reach some production plateau, then it's likely that the price will rise. But I still don't even see the catastrophe there. What with the taxes we pay, oil in the UK is around $300 per barrel at present. It is indeed a bit of a strain filling up the car, but other than that I don't see any more signs of the imminent collapse of civilisation than we normally have with politicians in charge.

Even if we accept the geological conventional wisdom, then there's still no cause for panic. Prices will rise, yes, so people will go off and do other things. Either use something else instead of oil (that ever cheaper shale gas for example) or simply doing things that require less energy. That's what a price system is for, after all, providing the signals that a certain resource is in scarce supply.

But the thing is, we really shouldn't be accepting this geology either.
The Green River Formation—an assemblage of over 1,000 feet of sedimentary rocks that lie beneath parts of Colorado, Utah, and Wyoming—contains the world’s largest deposits of oil shale. USGS estimates that the Green River Formation contains about 3 trillion barrels of oil, and about half of this may be recoverable, depending on available technology and economic conditions. The Rand Corporation, a nonprofit research organization, estimates that 30 to 60 percent of the oil shale in the Green River Formation can be recovered. At the midpoint of this estimate, almost half of the 3 trillion barrels of oil would be recoverable. This is an amount about equal to the entire world’s proven oil reserves.
Yes, we do know how to get this out: these reserves are similar to the Bakken shale in North Dakota that is spurting out oil as you read. _Telegraph
The author of the piece -- like many others recently -- may be understating the challenges of clean and economical extraction of the Green River kerogen oil shales. But that may be because we are not even close to the point that we need to extract oil shale kerogens to use in place of crude oil.

The best tool for clean, economical extraction of oil shales, oil sands, and conversion of gas, coal, and biomass to liquid fuels -- is high temperature gas cooled nuclear reactors of the generation IV variety. Areva and other engineering firms are working on perfecting that gen IV reactor technology, and although it may take the US government another 10 to 20 years to approve and license the designs, that is just about the time that we will need to start cleanly converting oil shale kerogens to crude.

In other energy news, the African nation of Ghana is looking for ways that it can integrate nuclear power into its overall energy mix. Nigeria is another African nation that is pushing to develop its own nuclear power industry.

Intermittent unreliables such as big wind power, are finding it more difficult to get lucrative subsidies from governments. Perhaps it is the fact that intermittent unreliables such as big wind and big solar are so unreliable and expensive, which is causing some governments to step back from the abyss.

And yet, tech powerhouse Google persists in its green energy dreams. Is it possible that for all of its brainpower, Google has allowed political activists to grab control of its energy plans and blueprints? That might explain Google's green energy idiocy.

Does anyone have access to the medical records of climate hack James Hansen? His recent attacks against Canada show the friend of Al Gore to have jumped the shark, right over a cliff. When a person confuses a computer model for the actual climate, he no longer deserves to be called a scientist.

There is a difference between educating oneself and indulging in self-indoctrination into a doomsday cult. It may be too late for this generation of peak oil doomer cultists, but if we hurry we may be able to save at least some of the newer generations -- and turn them into truly competent, independent, and very dangerous children. Which is precisely what the future needs.

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Tuesday, May 15, 2012

Government Radiation Hysteria Contributes to Energy Starvation

This article is cross-posted from Al Fin blog

A recent study from MIT suggests that government guidelines to protect from low level radiation exposure may be verging on the the hysteric -- if not downright harmful.
The study, led by Bevin Engelward and Jacquelyn Yanch and published in the journal Environmental Health Perspectives, found that when mice were exposed to radiation doses about 400 times greater than background levels for five weeks, no DNA damage could be detected. _MITNews
Life on Earth has always been exposed to variable levels of low level radiation. Background radiation has been a powerful driving force behind evolution, over the aeons.

Until now, governments have arbitrarily set radiation exposure limits, without basing them on realistic scientific studies. That may be about to change.
Until now, very few studies have measured the effects of low doses of radiation delivered over a long period of time. This study is the first to measure the genetic damage seen at a level as low as 400 times background (0.0002 centigray per minute, or 105 cGy in a year).

“Almost all radiation studies are done with one quick hit of radiation. That would cause a totally different biological outcome compared to long-term conditions,” says Engelward, an associate professor of biological engineering at MIT.

...Background radiation comes from cosmic radiation and natural radioactive isotopes in the environment. These sources add up to about 0.3 cGy per year per person, on average.

“Exposure to low-dose-rate radiation is natural, and some people may even say essential for life. The question is, how high does the rate need to get before we need to worry about ill effects on our health?” Yanch says.

Previous studies have shown that a radiation level of 10.5 cGy, the total dose used in this study, does produce DNA damage if given all at once. However, for this study, the researchers spread the dose out over five weeks, using radioactive iodine as a source. The radiation emitted by the radioactive iodine is similar to that emitted by the damaged Fukushima reactor in Japan.

At the end of five weeks, the researchers tested for several types of DNA damage, using the most sensitive techniques available. Those types of damage fall into two major classes: base lesions, in which the structure of the DNA base (nucleotide) is altered, and breaks in the DNA strand. They found no significant increases in either type.

DNA damage occurs spontaneously even at background radiation levels, conservatively at a rate of about 10,000 changes per cell per day. Most of that damage is fixed by DNA repair systems within each cell. The researchers estimate that the amount of radiation used in this study produces an additional dozen lesions per cell per day, all of which appear to have been repaired.

Though the study ended after five weeks, Engelward believes the results would be the same for longer exposures. “My take on this is that this amount of radiation is not creating very many lesions to begin with, and you already have good DNA repair systems. My guess is that you could probably leave the mice there indefinitely and the damage wouldn’t be significant,” she says. _MITNews
What is the cost of government-instigated radiation hysteria? Look at how the world reacted to last year's tragic earthquake and tsunami in Japan. Instead of focusing on the human tragedy of 30,000 human casualties, the media focus was on a nuclear power plant that lost power due to a poor design, discovered in hindsight, after an unanticipated natural disaster. And all of that, in spite of no one being killed or badly harmed from radiation exposure!

Advanced human societies are badly in need of reliable electrical power. The best source for that power is advanced nuclear reactors from gen III, gen IV, and beyond. But instead of pursuing an all out campaign of research and development to produce the needed electrical power generators, humans are retreating from the future in Germany, Japan, Switzerland, Italy, and more -- out of radiation hysteria.

It is time to return to a careful scientific study and to get away from hysterical herd behaviours, led by cynical governments and big money green organisations. That applies not only to nuclear hysteria, but to carbon hysteria, overpopulation hysteria, resource scarcity hysteria, and all the other forms of pseudoscientific hysteria that governments and the skankstream media love to torture the public with.

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Peak Oil is a Trite Truism; Peak Oil Doom is a Religious Cult

Peak Oil -- the idea that eventually it will not be economically viable to extract and utilise crude oil for fuels, chemicals, polymers, etc. -- is a trite truism. Everyone understands that humans will move away from dependency on crude oil eventually. It is unclear whether humans will be forced to give up their oil dependency or whether they will walk away from the large-scale use of oil voluntarily.

Peak Oil Doom -- the popular movement typified by the setting of dates and the drawing of peaking curves that collapse and take civilisation down with them -- that is the stuff of cultists and dull-witted disciples and believers in poorly documented prophecies and predictions.

It is important not to confuse the two concepts, since most intelligent people accept the fact that humans will eventually find it expedient to move away from crude oil dependency. That type of peak oil approaches the cliche'd meaning of "common sense," although it is more complex and has more possible variations than most people understand.

The Peak Oil Doom Cult and Religious Hysteria, is actually dangerous to those who take it seriously, potentially causing them to make ruinously stupid economic decisions. Their families also tend to suffer the malignant effects when believers submit their own minds to the cult. Not that you can talk such cultists out of their religion. Their doomerism is one of the things -- perhaps the main thing -- that makes them special, after all.

Peak oil cultists tend to believe that oil production has irrevocably peaked. That "fact" combined with another "fact" -- the exponential increase in demand for oil into the indefinite future -- leads them to be assured that oil will grow ever more expensive and less available into the future.

So what is a peak oil cultist to make of situations suggesting an apparent drop in demand? These disruptions in what was supposed to be a monotonic increase in the price of oil stretching well into the future, accompanied by an unexpected buildup in crude stopckpiles? Many of the fund traders of JP Morgan, Goldman Sachs, Citigroup, and the rest of the funds on Wall Street are being pushed into a tight spot by current contradictions to the post-peak narrative.
In April and especially May, plunging Brent and WTI prices are likely to have inflicted significant pain on many hedge funds. Month-end performance letters are likely to reveal some big casualties.

While prices continue to slide (September WTI is down another $2 already today) the remaining longs will continue to haemorrhage cash and face tough margin calls.

The key question for traders still trapped in old longs, as well as others thinking of re-entering the market on either the long or the short side, is whether the liquidation has run its course, or is there more to come?

For the time being, momentum clearly favours the downside. _Reuters
It is easy to get greedy when you believe you are in on a "sure bet."

Some peak oil doom cultists go beyond betting what they can afford. Some bet on margin, or on borrowed funds. If their belief is strong enough, they are apt to do just about anything to prove their faith, beyond the obligatory circle jerk deposits to discussion groups.

There is an old saying, "Trust, but verify." At the Al Fin Advanced Energy Institute, we say "Don't ever trust, always be sceptical until you can verify."

But try telling the cultists that. Heh.


Monday, May 14, 2012

300,000 Barrels per Day of New Synthetic Crude from Russian Stranded Gas?

Russian gas companies are notorious for their wasteful flaring of stranded natural gas and associated gas. If all of that wasted gas were converted to liquid fuels via GTL processes, it could amount to as much as 300,000 barrels per day of new production of synthetic crude.

Rosneft is planning a pilot GTL plant in the Volga region, using Oxford Catalysts scalable microchannel Fischer Tropsch GTL technology, in an attempt to develop productive uses for this huge -- but now largely wasted -- natural gas resource.
Rosneft is partnering with technology commercialization firm Gazohim Techno to design and construct a GTL demonstration plant using Oxford Catalysts’ microchannel Fischer-Tropsch technology. This plant will have a capacity of some 10 million cubic meters per year of natural gas, equivalent to approximately 100 barrels per day of synthetic crude.

...Rosneft has a stated objective and budget to reduce flaring and make better use of associated gas. This facility is envisioned as the first of many commercial GTL plants that will make use of associated gas.
After an extensive review of alternative Fischer-Tropsch offerings we decided to move forward with Oxford Catalysts’ technology. We found it to be the most attractive in combination with our POx process for the mini-GTL market we’re targeting. The potential in Russia for processing associated gas is over 30 billion cubic metres a year. —Sergey Dolinskiy, CEO of Gazohim Techno
We have been predicting that Russia would be forced to move to GTL technologies, to increase the value of its huge reserves of natural gas -- stranded or otherwise. This announcement by Rosneft is a simple acknowledgment that Russia cannot continue to waste its resources as it has in the past.

In the relatively near future, it is likely that Russia will be forced to look at larger scale GTL facilities similar to the Shell Pearl Qatar GTL plant, which cost about $20 billion to develop and build -- but which is expected to earn about $6 billion per year in profits.

To move up into that range of GTL production, Russia will need foreign partners. To assure foreign partners that their valuable assets will not be seized by the Russian government -- as has happened so many times in the past -- Russia will need to make some substantive changes in its way of doing business.

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Are Global Commodities Markets Getting an Advance Look at Peak Demand?

Commodities prices have been cooling recently, and fingers are being pointed toward China, Europe, and the US.
According to data compiled by Reuters, China's oil demand fell in April to its lowest level in six months. Implied oil demand fell 0.5pc in April to 9.31m bpd.

All of this has helped the price of Brent crude contracts to fall to around $112 a barrel now, compared with its high of $125.28 in December.

One-month futures in West Texas Intermediate (WTI), the US benchmark, are now trading at about $97 compared with their February closing high of $110.56. _Telegraph
Commodities fell to nearly two-year lows last week, measured by a widely used benchmark, prompting investors to ponder whether the massive rally that began in 1999 may be faltering.

China is cooling down at the same time the U.S. is struggling to heat up, clouding the outlook for the world's two biggest consumers. And producers of some raw materials have ramped up supplies enough to create at least temporary gluts, particularly if appetites falter. _WSJ
If the economies of the large importing countries are slowing, prospects for a renewed rally in commodities look unlikely.

How much of this tri-continental economic hiccup can be blamed on inflated oil prices? Certainly when oil prices rise above the level that markets can tolerate over the long term, demand destruction begins to set in.

More analysts are becoming pessimistic about China's near-term growth prognosis. If China is not able to pull the global economy, it is not likely that Europe or Obama's US can do much better.
SG Research highlighted both a slowdown in property investment and electricity consumption, with the latter indicating a broad-based deceleration in economic activity. Not only did the growth rate in total property investment more than halve to 9% year-on-year in April, but there are also now signs the property slowdown is spreading to consumption as well. Household appliances recorded the lowest growth rate among major retail categories.

Power-production growth — a figure frequently used as a proxy for the health of the wider economy — had almost stalled, growing just 0.7% in April. In SG’s opinion, this latest batch of data activity “scream out for easing.”

...It has been suggested before that current property curbs designed to slow the market will not be removed until the new government is in place, and the same goes for Beijing coming up with a substantial stimulus effort.

. Meanwhile, another wild card to distract Chinese leaders is the possible collapse of the euro and what this would mean for the competitive position of China, which ships approximately 20% of its exports to the euro zone.

CLSA in a new strategy note said a euro collapse is looking increasingly likely. Perhaps then, Beijing’s caution is warranted, as it is just keeping its powder in reserve for when it really needs it._Marketwatch
China is experiencing other problems of a political nature as well, which may create some blowback on the economy.

Only a few people are pointing toward an actual collapse in global commodities markets, but it would be wise to hedge your bets.

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Sunday, May 13, 2012

Green Die-Off Energy Policies Hurt Europeans

The governments of Europe are causing undue pain and hardship to Europeans. Thanks to Euro governments, the people of Europe will pay more for energy, and will be subject to energy shortages and power brownouts and blackouts -- all in the name of a computer modeled quasi-religious orthodoxy trying to pass for science: catastrophic anthropogenic global warming.
Denmark, an early adopter of the global-warming mania, now requires its households to pay the developed world’s highest power prices — about 40¢ a kilowatt hour, or three to four times what North Americans pay today. Germany, whose powerhouse economy gave green developers a blank cheque, is a close second, followed by other politically correct nations such as Belgium, the headquarters of the EU, and distressed nations such as Spain.

The result is chaos to the economic well-being of the EU nations. Even in rock-solid Germany, up to 15% of the populace is now believed to be in “fuel poverty” — defined by governments as needing to spend more than 10% of the total household income on electricity and gas. Some 600,000 low-income Germans are now being cut off by their power companies annually, a number expected to increase as a never-ending stream of global-warming projects in the pipeline wallops customers. In the U.K., which has laboured under the most politically correct climate leadership in the world, some 12 million people are already in fuel poverty, 900,000 of them in wind-infested Scotland alone, and the U.K. has now entered a double-dip recession.

The U.S., in contrast, will see power rates decline starting next year, according to the U.S. Energy Information Administration, dropping by more than 22% by the end of the decade and then staying flat to 2035. Why the fall? Mainly because the U.S. will rely overwhelmingly on fossil fuels in the years ahead, not just coal, which dominates the current power system, but increasingly natural gas, which is expected to account for 60% of all new generating capacity in the future. Thanks to fracking, the U.S. effectively has limitless amounts of inexpensive natural gas to add to its limitless coal.

While the rest of the developed world was in thrall to global-warming rhetoric, the U.S. talked the talk but balked at following through. In 1997, then president Bill Clinton and his vice-president, Al Gore, happily signed on to the Kyoto Treaty, which coerced the countries of the developed world into compromising their economies in order to save the planet. While other nations then dutifully complied, the U.S. Senate — as Clinton and Gore knew it would — refused to ratify Kyoto by a 95-0 vote. Clinton’s successor, George W. Bush, did an equally superb job of talking but balking at taking economy-killing measures. Bush successor Barack Obama, although a global-warming true believer, also put global warming on the back burner, preferring to make Obamacare, rather than climate change, his signature issue.

With the Republicans all but certain to control the purse strings following the November elections by dint of a majority in the House of Representatives, European-style legislation in the U.S. in aid of global warming will be impossible, even if the Republicans don’t also capture the Senate and the White House, as polls now indicate they will. In the event of a Republican sweep, the gap between power prices in the U.S. and the rest of the developed world will increase even more as “Drill, baby, drill” Republicans remove the existing restraints on the U.S. fossil-fuel industry, and slash the remaining subsidies on the U.S. renewable-energy industry. _Financial Post
Europe is already shrinking demographically, and only slowly beginning to confront the ruinous effects the of collapsing dominoes of debt across the EU, in the midst of a demographic contraction.

When the economic effects of the absurdist energy starvation policies of lefty-Luddite green influences on EU governments hit the fan, Europe's people and economies will really have something to cry about.

By the time the Euro leadership discovers how badly they have been hoodwinked by the carbon hysteric orthodoxy of CAGW, too many nations in the EU will be redlined on the misery meter.

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Friday, May 11, 2012

Peak Oil: Strangely Emotional and Oddly Overdone?

...although the peak oil debate is never really absent, its intensity does seem to be correlated with the level of oil prices. It reached its most recent peak when oil prices were very high and rising during the first half of 2008, the infamous 'annus horribilis' of excessive oil price volatility. Trainloads of articles appeared saying that this time the world was running out of oil, that prices would soon hit $200 and more, etcetera. Today, the intensity of the debate is somewhat lower, but it is still raised at nearly every energy conference or debate.

...historically it is hard to dispute that, as Daniel Yergin and others have pointed out, the prediction of oil production peaking is a recurring theme, ever since the beginning of the oil age in the 1850's. Analysts have identified 1948, 1956, 1974, the early 1980's and 2007/2008 as 'peaks' in the oil peak debate.

...the definition of what's peaking or not matters a lot. Are we talking about non-OPEC supply, crude oil production or, more relevant, liquid fuels including unconventional oil (oil sands, heavy oil, shale oil), Natural Gas Liquids (NGL's), gas-to-liquids (GTL), biofuels? That makes an enormous difference....

On a related point, it is often assumed (explicitly or implicitly) that a peak in global oil production is followed by a fast and steep drop (following the shape of the famous Bell curve for an individual field) with all the undesired implications. However, it is not clear why after reaching a peak in global oil production we couldn't experience a plateau even for decades following the moment production peaked. The implications for energy policy are vastly different in that case. _European Energy Review
The author makes some interesting points about the peak oil hysteria cultorama. When oil prices periodically rise, the peak oil fever tends to spread and rise in intensity and power of conviction. It becomes easier to jump on the bandwagon and shout from the soapbox, when every Tom, Dick, and Harry believer is crowded alongside.

But cycles tend to go down as well as up, and people who bet too heavily on "peak oil" near the top of the upswing, tend to lose parts of their shirts on the downswing. High oil prices draw in new investment, new exploration, and new technologies of recovery, exploration, and substitution.

...the power of technology is often severely underestimated. The global recovery rate is now 35%, and it is well-known that only a 1%-point increase in the global recovery rate already provides 2 years of extra global oil consumption at current rates.

We know that in some important fields companies are already recovering 50% or more of reservoirs, using new technologies like enhanced oil recovery (EOR) and 3D seismic ...barring new field discoveries, there is a huge upward potential in recovery rates as existing technologies get more widely adopted and new technologies are developed. Certainly when oil prices remain relatively high, there is a very strong incentive to raise recovery rates, even for oil in current reservoirs that is costly to exploit.

...On the aggregate it is hardly disputed by serious experts that whereas mankind has roughly utilized 1 trillion barrels of oil, the remaining conventional and unconventional oil resources probably are in the order of 3-4 trillion barrels. _European Energy Review
If a person wants peak oil to be true -- if they actually want civilisations to collapse, cities to burn, and the law of the jungle to control the world once again -- they will resist all contrary arguments to their last ragged breath. But someone who is looking for the truth is likely to acknowledge that the entire peak oil extravaganza has become strangely emotional and oddly overdone.

Perhaps part of the problem is the Mayan prophecy of the apocalypse, or other religious tales of armageddon or the Mahdi. A large part of the excitement is no doubt the prevalent secular religion of the day -- dieoff.orgy lefty-Luddite greenism. Or, perhaps humans are truly on the cusp of an important historical transition. Not doom from carbon hysteria or resource scarcity, perhaps, but something phenomenal all the same.

To people who are set in fossilised ways of thinking, any disruption at all -- even disruptions that lead to greater abundance, prosperity, and overall human happiness -- would be a catastrophe. The only way that such persons can portray such a monumental change would be through the lens of doom. If such doomerism penetrated high enough within a society, it could become something of a self-fulfilling prophecy, if its recommendations were ever put in force by governments and inter-governments. Now, that really would be overdone.


Intermittent Wind Cannot Replace Baseload Power

Affordable, utility-scale batteries are a number of decades away. One cannot rationally discuss the topic of national or international grid dependency on intermittent power sources without admitting that basic fact.

We should first look at some basics.

Let's look first at two graphs depicting power grid load curves:
This graph looks at
  • baseload power -- predictable 24/7 power loads
  • intermediate load -- predictable loads of intermediate duration
  • peak loads -- less predictable shorter duration loads.
for both summer and winter conditions. It is clear that baseload and intermediate load, being predictable, would require predictable supplies of power, generated by reliable power sources.

Energy sources that are intermittent are -- by definition -- not predictable, and generally unsuitable to supply baseload and intermediate load power. In the same way, intermittents are even less suitable to supply peak power, since in that case both the load and the supply are unpredictable to grid managers.
This graph looks at grid load curves in summer and winter, but assumes a large electrical vehicle fleet, which is re-charging itself during non-peak hours, when power charges are lower. When such a large-scale re-charging takes place, the grid load curves are essentially altered to make most demand into baseload.

Such a grid load curve -- where most of the load over 24/7 is baseload -- matches both nuclear power plants and coal power plants almost perfectly.

Here is a very basic introduction to the problem of trying to use intermittent power supply for critical power loads which must be supplied on a reliable basis:
Here is the analogy: Suppose there is a car on the market that is very environmentally friendly. Its mileage is phenomenal! I call it a “super-green” car.

This super-green car has the same horsepower as a conventional car. It will handle steep hills as well as a conventional car. It has the same 0 to 60 mph performance. The only difference is that when you try to start it in the morning, it will only start 25 percent of the time, and you can never predict on which day it will start. It runs, randomly, 25 percent of the time.

Would you replace your conventional car with a super-green car to get you to work every day? To keep the analogy simple, let us assume that if the car starts on a particular day, it will also take you home at the end of the workday. If it doesn’t start on a particular day, however, it won’t start that day no matter how often you turn the starter key.

To most people, the answer is obvious. Most of us would not hold on to a job very long if we randomly showed up at work only 25 percent of the time. So the answer is no, the super-green car cannot replace the conventional car. Horsepower is the equivalent of capacity in this analogy. An intermittent electrical power source with a capacity (or power capability when it is working) to generate 1000MW cannot replace a conventional power plant with a capacity of 1000MW. Even though the capacities are the same, the power plants are not equivalent. Yet capacity comparisons are made all the time, as if this somehow makes the power plants equivalent. They are not equivalent.

Capacity factor

Others would say that since the capacity factor is 25 percent (the car works 25 percent of the time), you would just need four cars to reliably get you to work every day. This is also not true, however. There is a chance that none of the cars will work on a particular day. As a matter of fact, this probability can be computed, if the probability of each car not working is independent of the other cars not working. It is 0.75 x 0.75 x 0.75 x 0.75 or (0.75)^4, which is equal to 32 percent. So if you owned four super-green cars, the probability of none of them working on a particular day is 32 percent. So, with four super-green cars, you get to work 68 percent of the time, which is better than 25 percent of the time, but it is still a long way from 100 percent of the time.

Another problem with using capacity factor as an equalizing parameter is that there are times when more than one car will start. The extra cars, however, are of no value to you as far as getting to work is concerned. The extra working cars do not average out with the demand to get to work on time each day. They are working at the wrong time.

Note that in the case of a wind farm, the probability of each turbine not working is not independent. If the wind doesn’t blow in a particular area, it will affect all wind turbines. The probabilities are not randomly independent. Therefore, wind farms must be in separate weather patterns, in order to significantly reduce the unavailable time.


A better equalizing parameter is generation. When the super-green car works, it generates highly economical miles. That parameter has its problems as well, however. The generation of economical miles can be increased simply by taking the long route to work. Those extra economical miles are of no value as far as getting to work is concerned. In the same way, generated electricity has no value unless there is a demand for it at the time that it is generated. This is because electricity has zero shelf-life. It must be consumed when it is generated.

So, when generation cost comparisons are made between intermittent and baseload power sources, this presumes that the resulting electricity value is the same. This is actually not the case, because electricity generated when the demand for it is not certain does not have the same value as electricity that is generated when there is demand for it.

There is no perfect equalization parameter when making comparisons between intermittent and baseload generated electricity. Capacity is by far the worst, next comes capacity factor, and the best is generation, but it is not perfect.


So, the conclusion is that intermittently generated electricity cannot replace baseload generation. Just like there is a chance that none of the super-green cars are working on a particular day, there is also a chance that no electricity is generated by an intermittent source. Hence, all the conventional power sources are still needed. _Energy Collective
Go to the link above and skim through the article, then read the comments. It is obvious that many of the readers of the website live in a land of green dreams and wishful thinking. Affordable and reliable utility scale storage batteries are decades away. And yet these green dreamers want to push big wind and big solar onto the grid today! And at a much higher proportion of total grid capacity than power grids can adjust to. In other words, for all their good intentions, these green commenters are promoting policies that would crash the power grid!

It is true, of course, that large scale electrical fleets capable of converting grid load curves to an overall 24/7 baseload graph, are also decades away. Because the same technological limitations on utility-scale batteries also apply to EV batteries.

Even if utility scale batteries were available, would it make sense to replace nuclear, coal, and gas power plants with big wind and big solar? Of course not. If you look at the total costs of methods of power generation over their lifetime, adjusting for the cost of infrastructure buildup and conversion, and adjusting for the costs of backup power, maintenance, and replacement -- it becomes clear that big wind and big solar are not even close to ready for prime time.

Green dreamers will be the death of us all -- which is exactly what many of the purveyors of these green dreams are hoping. The people behind the green dreams know better, but they do it anyway. Powerful individuals in the big money green-industrial-political complex -- better known as lefty-Luddite dieoff.orgiast greens -- would like nothing better than to see 90% or more of the global human population simply disappear. At least they believe they would like to see it.

Energy starvation of the advanced world -- through forced conversion to unreliable intermittents, through forced carbon taxes and trading, through carbon hysteric rules and regulations etc. -- will have cascading effects on the emerging and developing worlds, leading to significant hardship and possibly large-scale death. At least that is the hope and the plan, by the lefty-Luddites at the top of the food chain. The green dreamers who leave vacuous comments on Energy Collective websites are the expendable cannon fodder.

As for those who understand the potentially disastrous effects of green faux environmental policies being forced onto the industry, commerce, and power supplies of the advanced world: Hope for the best, but prepare for the worst.

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Thursday, May 10, 2012

Daniel Yergin on Iraq's Oil Boom

Energy Insights Global Oil Production Review
Iraq's resurrection from oil death has provided an interesting side story to the energy and oil news worlds. Under corrupt national oil companies, expensive infrastructure often rusts into oblivion, through neglect and political malfeasance. But under Iraq's new regime of international competing bids and producers, there is much more incentive for the foreign producers to maintain expensive equipment, and to be more careful of the oil resource in the ground.

Here are some excerpts from a long a rambling interview of Daniel Yergin, conducted by someone who obviously knows more about political agendas than about energy.

And Daniel Yergin joins us here in Studio 3A. Nice to have you back on the program.
DANIEL YERGIN: I'm delighted. Thank you.
CONAN: And how promising are these numbers about Iraq?
YERGIN: Well, it's been a long time coming. What it means is Iraq is back to where it was in 2001 so - but it's certainly an improvement. It's coming at a time when sanctions are going in place on Iran, and there's a premium on supplies coming from other countries, and Iraq is one of those countries.
CONAN: Iraq always said to have enormous reserves that could make it, well, almost on a par with Saudi Arabia.
YERGIN: Yeah. Well, that will take a very, very long time. There are very optimistic numbers out there from the Iraqi oil minister and others that would get it on a par, but it's a very big job to even get it to, say, maybe a little more than half of what Saudi Arabia is. It's going to take a lot of investment and time. But, as you said, those resources have been there for a very long time, and the reason they haven't been developed is what's happening aboveground.
CONAN: And that's the politics, and it's certainly not solved by any stretch of the imagination. It continues to be violent but a great deal less.
YERGIN: Yeah. That's right. There's less violence, I mean, is a key thing. And one of the things I really - I talk about in "The Quest" was that it turned out that the oil situation in Iraq after the war began was much worse. It was worse not because of the aged fields - and these were very aged fields. There were control rooms and refineries that have been built by the Americans in the 1950s but because of the sabotage, the destruction, the rampant looting and all of those things sent the Iraqi production way down, and it's been rebuilding now. Foreign companies are coming in and bringing capital and technology to get these fields up. And so that's why we're seeing this boost.
CONAN: Foreign companies, you mentioned, not very many American companies.
YERGIN: No. If you remember, there's all the talk about American companies being there. There are very few there. I think the American companies looked at the economic terms, and many of them just decided this is very tough, that we can't make money doing this. So you have - it's really like a sort of mini United Nations. You have Chinese. You have Indian. You have Russian. You have a couple of American, a lot of European companies there. And they're all working because they want to get a foothold in what might be, you know, this major new oil production opportunity.
CONAN: And much of this new production - and we mentioned the production - the loading platform off of Basra - is in the southern fields and the Shia areas in the south. There's also contentious politics involving the northern fields in Kurdistan.
YERGIN: Absolutely. Kurdistan - the Kurdistan oil minister was here recently. It's the autonomous region. And he holds out a vision that Kurdistan itself could become a major source of oil. It was an area that under the Saddam time was really ignored for exploration because Saddam didn't want to put money and resources into the Kurdish area. And the Kurdish minister, Dr. Ashti, told this story when he was here the other week, about how, when they were negotiating Baghdad for 2006 for who would have the oil fields, the Iraqis in the south said, oh, there's no oil there. And so he said just give me those mountains.
CONAN: So as Iraq re-emerges as a major player, as you mentioned, the sanctions on Iran had made it difficult and reduced Iranian exports. But in your book, "The Quest," you talk about the competition between Iran and Iraq as a major limiting factor, eventually, on Iraqi production.
YERGIN: I think that's the case. It's a historic - really tell the story of the historic struggle over who will dominate the Gulf. And, of course, now it is a Shia-Iranian more friendly regime in Iraq. And as soon as Iraq raised its estimates of its reserves, like the next week Iran said, well, our reserves are larger and the Iranians are not going to particularly welcome a big increase in Iraqi production, and I think is, you know, things have calmed down. On May 23rd, the U.S. and the Iranians are going to meet in a neutral city, Baghdad, to discuss nuclear sanctions and the nuclear program, but the Iranians have a lot of influence over what happens in Iraq.
CONAN: In the meantime, the diversity of oil around the world, it would seem that the Middle East had a chokehold with its, what, 25 percent of proven world reserves. That has been reduced.
YERGIN: It is. You know, I'd say, you know, there always a surprises that's happened in world energy and world oil, and I think the biggest surprise right now is what's happening in the United States. I was looking just before the show, and I think you can expect that as large as the increase in Iraqi production will be this year, that will have about the same size increase in the United States. And if you'd said that four, five years ago, that would have seemed fantasy.
CONAN: And this largely due to the fracking process and oil shale?
YERGIN: Yeah. Yeah. Yes. Well, yes.
CONAN: Shale oil, excuse me.
YERGIN: Well, it's very confusing, oil shale, shale oil. Tidal oil seems to be the term people are using, but this is what has turned North Dakota into the third largest oil-producing state in the country. And, you know, you don't think of North Dakota as the oil patch before.
CONAN: In the meantime, we also have Venezuela. Its reserves growing as discoveries increase there. And Brazil, emerging offshore as one of the great oil producers in the world.
YERGIN: Yeah. That's one of the things I really focused in on the quest because, you know, people don't think about Brazil. They think about it in terms of ethanol, but the growth of Brazilian production has been a big deal. Just about a month ago, the president of Brazil was here in Washington and was telling the story that people in the '70s and '80s said, we have to develop ethanol because we have no oil. It turns out Brazil now has a lot of oil, and that offshore oil in what's called the pre-salt, which is - was challenging - it was a frontier to get through it, now holds the prospect that Brazil could be producing twice as much oil as Venezuela in a decade or so if things go on track. And we never kind of thought of Brazil as energy power before.
CONAN: And through all of these developments, the arguments over the environments continue, how much degradation is caused by the fracking process. That's a particular controversy in this country involving natural gas, as well oil production. And the greater argument over how much burning all of these combustibles - oil, gas, everything else - is contributing to global warming.
YERGIN: Well, I think we have to divide it into two parts. I mean, we have, you know, maybe the most important climate policy we have in the country. One of the most important is the fuel efficiency standards for cars. So it's a question, where is that oil going to come from? Do we want it to come from Venezuela, or do we want it come from Canada, even though we - our peak demand has gone down. And on the environment, in terms - I was under the committee that reported for President Obama last year on the environmental aspects of shale gas. And I think the conclusion of the administration is that these are all manageable, and there're pragmatic solutions to something that is really changing the energy position of the United States.
CONAN: Our guest is Daniel Yergin, chairman of IHS CERA and author of "The Quest: Energy, Security, and the Remaking of the Modern World." And let's see. We got some callers in on the conversation. 800-989-8255. Ken is on the line, calling from San Rafael in California.
KEN: Hi. My questions is this. You know, we have increased our supply of natural gas and oil through fracking. How much natural gas - and I think that's probably a bigger issue now because we convert everything to natural gas if we chose - to - is coming from non-fracking, because we're seeing that the side effects of fracking may be untold at this point. And how much of our natural gas is offshore on the East Coast because in the 1950s, there was a study done that said we have enough natural gas off the East Coast alone to supply the United States under full production for at least 100 years.
YERGIN: Well, I think off the East Coast of the United States there's really been no modern exploration because activities ceased several decades ago. And natural gas, about 37 percent of our total production now is shale gas. And a decade ago, it was about 2 percent. So it's really grown quite phenomenally. And the other thing, supplies have grown so rapidly that the price of natural gas has really collapsed. So people know how much they're paying more for gasoline, but if they'll look at their natural gas bills at home, they'll see that those bills have gone down.
CONAN: There was a - and thanks very much for the call, Ken. There was an interesting story in the paper the other day, an import terminal that had been built in Maryland to bring in natural gas that people are saying, this needs to be redeveloped so we can export natural gas to places like Japan where it's - you can get a good price for natural gas.
YERGIN: Yeah. Well, exactly, the Japanese because they - basically, every single - all 54 nuclear power plants in Japan are now shut down. They are scouring the world for natural gas supplies in form of liquefied natural gas. And what it shows in the development here is that because of these technological breakthroughs, we were - five years ago, we were going to be a big importer. We were going to spend $100 billion a year importing natural gas, liquefied natural gas. Now, we have so much and prices have collapsed so much that, indeed, there are these projects and proposals to actually - we would join the queue of LNG exporters.
CONAN: And at the moment, there's no place to put all the natural gas.
YERGIN: Well, right. We're very close to actually running out of storage room.
CONAN: Let's see if we got another caller in. Randy is with us from Elkhart, Indiana.
RANDY: Hi. If we had started 30 or 40 years ago aggressively to drill oil, we would have the same problem that we're having with natural gases right now, I think. Do you think we're better off for having waited and kept all that oil in the ground all this time?
YERGIN: Well, I think it was a question of people knew the oil was sort of there, but it was just - it was not thought to be economically possible to do it. So I think what's happened is that the technology, how to evolve, how to develop, and it was about 25-year period, looking at decades you're talking to, for this technology to mature where it is today. And it really has only taken off in the last three, four, five years.
RANDY: But do you think we're better off for having it in the ground, we've been better off lowering oil prices then, or...
YERGIN: Oh. Well, I think, you know, history is what it is. I think that we've been done - I mean, what we do have the opportunity now is to have more of our production domestically. And I think what's become clear - and I think this has been very important to the Obama administration as well to the Republicans - is recognizing that it's not just we're not importing oil, it's not just energy security, but it turned out that there's a big economic development job component. President Obama mentioned 600,000 jobs from shale gas in his State of Union address. And I think it's part of this kind of changing discourse we're having about energy in our country.
CONAN: Randy, thanks very much.
RANDY: Thank you.
CONAN: We're talking with Daniel Yergin. And CERA, isn't that used to be Cambridge Energy...
YERGIN: Research Associates, and that's compressed.
CONAN: Oh, that's compressed, like everything else. You're listening to TALK OF THE NATION from NPR News. Ralph is with us. Ralph from Raleigh in North Carolina.
RALPH: Hi. I got a quick question. You just mentioned Brazil. I'm wondering about how the whole BRIC thing works out, Brazil, Russia, Indian, China pact. And who are the biggest consumers of Brazilian gas?
YERGIN: Well, it's really Brazilian oil. I mean, Brazil's an exporter of oil. It's actually run short of ethanol. It's now importing ethanol from the United States. But it is interesting. You take those four countries, you - they really symbolize the change in the global economy that's occurred, the change of where income growth is and so forth. And you've seen - so you see this growing trade between Brazil and China.
When the president of Brazil was here, she remarked that in the '70s, China used to export oil to Brazil. Now, Brazil exports oil to China, along with a lot of other raw materials. But the big market, the one that created what I called in "The Quest," the demand shock is, of course, China, which has grown so fast, and its oil consumption now is about half of the United States. They sell more new cars every year in China than in the United States, and that kind of - it's a sign post to the future.
CONAN: Ralph, thank...
RALPH: Paul Krugman had talked about that before. I guess, you know, with the oil production, I'm wondering, geopolitically, you know, that's something that the United States needs to look at, you know, that relationship alone, not just China but with Russia and India as well.
YERGIN: Well, I think that geopolitics are always part of energy and, you know, Russia is a big exporter of natural gas to Europe. It's critical to its budget. And, you know, there's - oil is one of the issues in the U.S.-China relationship, energy in general, and I think it's something that we have to kind of pay attention to and manage it so it kind of stays a commercial issue and doesn't become a strategic, competitive issue, because that won't be good for anybody.
CONAN: Ralph, thanks very much.
CONAN: Daniel Yergin, thank you so much.
YERGIN: Thank you.
CONAN: I appreciate it. Daniel Yergin, a Pulitzer Prize winner for "The Prize." His most recent book, "The Quest: Energy, Security, and the Remaking of the Modern World." _Interview w/ Daniel Yergin _


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