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Will Solar Prices Fall into Grid Parity?

The following is a guest post written by Dan Harding. Dan has written numerous articles on the solar industry, and is a regular contributing author to CalFinder.
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Will Solar Prices Fall into Grid Parity? 


By Dan Harding

The Holy Grail…in solar-speak, it translates roughly to Grid Parity. It is a goal either mythical or predestined, depending on which side of the solar power movement the speaker resides. A recent surge in supply and technology, coupled with increased government subsidies, are tipping the scales toward destiny, although by no means is the path to grid parity set in stone. The rapid fall in prices for solar panels and other system components in an oversupplied and flooded market could continue home solar power on its way to that mythical Grail but, all mythos and wishful thinking aside, what are the odds?

Good, says Swami Venkataraman, Director of Corporate and Government Ratings at Standard & Poor’s, in a recent assessment of the U.S. solar market for Renewable Energy World. As of February, 2009, installed costs for residential and commercial photovoltaic (PV) systems had fallen to $7.60 per watt from $10.50 per watt just two years earlier. Prices continued to fall throughout 2009 and, while expected to stabilize somewhat as the national economy rebounds, they should remain on that downward slope in 2010 and beyond.

So when will solar cross that line? It could be soon, very soon in regions of the country with either abundant sunlight (southwest) or relatively high electricity costs (northeast). Yet some valuable help is still needed at the legislative level which, if provided, could propel solar power to grid parity in the short-term in the aforementioned regions.  


Three factors, says Venkataraman, can help make PV cheaper than, say, a combined-cycle gas turbine plant. One or all of the following could ensure solar power a level playing field in the long term:
  • Rising gas prices
  • Renewable portfolio standards that make renewable energy credits (RECs) more valuable
  • The passage of carbon legislation that would force gas power producers to buy carbon credits, thus forcing an increase in price for natural gas.

Including incentives, solar power is already close to grid parity in many areas. The Northeast holds the handy combination of some of the most lucrative solar incentives (per watt installed) in the country, as well as the highest electricity prices. Therefore, solar has far less distance to make up to reach at least natural gas, and gives solar power the best and fastest chance to reach grid parity in the nation. In California, where incentives have been declining for several years now, the primary advantage is in abundant sunlight (same goes for Arizona, New Mexico, west Texas, etc.), as well as a powerful RPS and a general eagerness from the public to adopt clean energy.

But as those two examples illustrate, grid parity will almost certainly NOT come to the United States as a whole all at once. Federal incentives were expanded in 2009, including the removal of the $2,000 cap on residential systems and the admittance of utilities into the Investment Tax Credit, but continue to vary widely between states. The feds provide a baseline subsidy, but what truly makes solar affordable for most homeowners and businesses are the added incentives offered by their state. So, in terms of reaching grid parity, we can expect the Southeast — despite its healthy share of sunshine — to be the slowest to reach the Holy Grail. This is due primarily to a lack of incentives, low electricity costs and a deep connection to fossil-fueled electricity.

Without incentives, there is still a real chance for PV, especially commercial PV, to reach grid parity in the relative short-term. Current capital costs for commercial PV are about $5.50 to $6.60 per watt depending on the size of the installation, according to Standard & Poor’s. Incentive levels in many northeastern states are upwards of $4.00 per watt, which means that, given incentives, the levelized cost of electricity (LCOE) of commercial PV systems was already below standard commercial rates. Furthermore, if falling panel prices enable systems to reach or fall below $5.00 per watt, then solar PV could reach parity even without subsidies.

Residential grid parity is more distant but still closest in the Northeast. Outside of the Southwest and Northeast, where solar irradiance and/or electricity costs make the solar-grid-parity question more complicated and uncertain, help will have to come from other renewables. Most notable among these are geothermal (Northwest) and wind power (Midwest). It is important when discussing grid parity for solar power not to forget its intermittency and the fact that some backup power system will be needed. Even if our solar infrastructure were so advanced as to provide all our power needs during peak load times, we would still need alternative sources to pick up the slack on cloudy days and at night.

Of course, straight-laced economics aside, we must also consider the inherent value of solar power beyond mere dollar signs. The point of renewable energy is to switch from pollutive, peaking sources of energy to clean, renewable ones. Solar power emits no greenhouse gases, no carbon dioxide and, when distributed, can provide power at or near the point of use without turning our cities into smog factories. That alone is reason enough to subsidize solar, wind, geothermal and other renewable resources until they reach the Holy Grail that is their destiny.

March 3, 2010 Posted by | guest post, reader submission, solar power, solar PV | 14 Comments

Energy Policy and Renewable Hydrocarbons

The following guest essay is by Frank Weigert, a retired DuPont chemist who was involved in some of DuPont’s early work on alternatives to petroleum in the mid-1970’s. This work spurred a lifelong interest in a renewable hydrocarbon economy. Recently Frank sent me an e-mail in which he described his views on a pathway that could lead us away from our dependence on petroleum. It was a very detailed and technically interesting e-mail, and I asked him if we could turn it into an essay for others to read. What developed from that request was the essay below.

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Many people find it hard to think rationally about our energy problems because there is so much misinformation and disinformation out there. Some is the innocent confusion of people misinterpreting scientific terms in layman’s language. An example is the word “oil”.

Some is more sinister, with whole industries planting lies and distortions to confuse the issues. Corporations and their lobbyists spend large amounts of money protecting their short-term interests from reforms needed to promote long-term good.

Politics distorts good decision making. If Iowa didn’t hold a Presidential beauty contest every four years, ethanol would not be on the agenda. If corn-based ethanol wasn’t on the agenda, then ethanol from cellulosics wouldn’t be either.

Economics is used as a weapon against change by polluting industries who are not now held accountable for the damage they do. Utopians refuse to see just how expensive some of their proposed solutions are. While the magnitude of our energy problem is orders of magnitude greater than the CFC / ozone problem of two decades ago, some of the precepts used to solve that problem also apply to the current one.

The world needs to think outside the box. We have a remarkable opportunity to establish a sustainable energy future that could last centuries. Short-term solutions which profit existing businesses should not be allowed to crowd it out.

1) Biofuel Definitions.

Non-chemists all too often get confused by the differences in chemical nomenclature and more conventional terms. Oil as an ingredient in salad dressing is not the same as oil as a synonym for petroleum.

Green plants make nucleic acids, proteins, hydrocarbons, carbohydrates, and lipids. Only the latter three need concern us as fuel precursors. Hydrocarbons have only carbon and hydrogen in their structure. Examples include natural rubber and other materials made from isoprene oligomerization.

Carbohydrates have formulas around (CH2O)n: Carbo (C) – hydrates (H2O). Glucose, C6H1206, is a monomer. Sucrose is made from glucose and another sugar fructose with the loss of one water molecule. Both sugars are soluble in water. Polysaccharides such as starch and cellulose are insoluble in water. Yeasts ferment soluble sugars to ethanol, an alcohol. The technology to ferment insoluble carbohydrate polymers practically does not yet exist.

Lipids are esters of the alcohol glycerin and long-chain fatty acids. Transesterification with a short chain alcohols such as methanol or ethanol converts these lipids to glycerine and esters generically known as biodiesel. Biodiesel is not a hydrocarbon.

Hydrocarbon reactions are generally many orders of magnitude faster than the reactions of polar molecules such as those involving alcohols or esters. That means that the equipment required to reform hydrocarbons is much smaller than that required to ferment carbohydrates to ethanol or transesterify lipids to biodiesel. Hydrocarbon chemistry does not require a solvent. Fermentation must be carried out in water, and yeast generally can only produce an ethanol concentration of 10% or so. The ethanol must then be separated from a large excess of water. Transesterification to make biodiesel is an equilibrium process that will not go to completion without a large excess of the small chain alcohol. That means large equipment for separation and recycle. While a hundred or so refineries provide all the transportation fuel America uses, many thousand fermentation or biodiesel facilities would be needed to produce the same amount of fuel.

The new investment required to convert from a hydrocarbon economy to one involving either ethanol or biodiesel is going to be very high. Why bother? Use hydrocarbons. Hydrocarbons such as gasoline or diesel are global warming neutral if produced entirely from biological materials.

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2) What defines a Climate Change / Hubbert’s Peak solution.

Four precepts should guide our work in solving the world’s Climate Change and Hubert’s Peak problems.

a) These are world problems. An expensive solution that works for the United States but not for China, India or Kenya is not a valid solution. America might be the Saudi Arabia of coal, but coal is not a solution for the Hubbert’s Peak problem because it exacerbates the climate change problem. Where is China going to get the land to grow corn to make ethanol? Solutions that depend on local conditions such as desert sunlight or constant high winds are not solutions to the global problem. Venture capitalists who want to get rich selling high investment solutions are part of the problem.

b) Consumers should not have to change anything.

The precept needs to be considered separately for electricity and transportation fuels.

Electricity is easy. Consumers don’t care whether the electrons that power their lights, televisions or computers come from falling water, burning coal, or splitting atoms. An electron is an electron.

Transportation fuels are harder. Hybrid cars like the Prius come closest to meeting the criterion. Consumers fill up their gas tank and don’t have to worry about the battery until it wears out. The cost of the replacement battery has not sunk in yet. A typical battery pack costs $5000 and will last five years. Thus during the life of the electric car, owners will have to pay $10,000 to replace their battery twice. You can buy a lot of expensive gasoline for that amount of money.

Plug-in hybrids WOULD be different. Suppose you live in an apartment and park 100 feet away. That’s an awfully long extension cord. A better option is to continue making gasoline and diesel, only from renewable resources. Cars powered by fuel cells or hydrogen are even more far out. People like personal transportation. Walking is not a solution. Shutting down the airline industry is not a solution.

c) Use existing investment when at all possible and minimize the need for new investment.

This is where most of the pundits get it wrong. Venture capitalists love high investment projects because they earn their fees as a percentage of the capital required. The November cover story of Scientific American is about sustainable fuels. It limits the discussion to Big Physics projects. Only toward the end do the authors offer an estimate of the capital investment required: $100 TRILLION. Ain’t gonna happen. Many of the proposed remediation projects are also horribly capital intensive and will never fly.

Many physics solutions claim they will be competitive with oil “soon.” But oil at what price? In the Middle East, countries can pump oil to the surface for a COST $5 a barrel. Americans VALUED that oil at $150 a barrel in 2008. Europeans and Japanese are willing to pay twice that, including taxes. So what is the free-market PRICE of oil? OPEC can set it anywhere within that range. If photovoltaics become competitive with oil at $100 a barrel, OPEC can lower the price to $90 a barrel until the venture capitalists give up. They then buy up the investment for pennies on the dollar, destroy it, and raise the price again. I don’t see any way to compete with $5 a barrel Middle East oil. I would be hopeful that biofuels could compete with $25 or $30 a barrel oil.

d) Biofuels should not compete with food production or cause land use issues.

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3) The algae Botryococcus braunii can potentially meet all my criteria for a solution to the Climate Change / Hubbert’s Peak problem.

Nobel Prize winner Melvin Calvin discovered a shrub growing in the Brazilian rain forest related to rubber tree in the 1970s. When tapped, this shrub exuded a latex. Calvin collected the material, (a mix of isoprene trimers) broke the emulsion, dried the organic layer, poured it into the fuel tank of a diesel powered car and drove off. No refining necessary! He correctly realized there was not enough land in the Brazilian rain forest to grow this crop. Genetic engineering did not exist back then.

Calvin made a bad mistake when he attempted to breed a modification that would grow in the desert. Making hydrocarbons needs more water than making carbohydrates. He should have been experimenting in a swamp.

Later, Calvin found the pelagic algae genus Botryococcus and studied the hydrocarbons they produce.

A summary of his work is available online, but cannot be accessed directly. You have to link through a bridge site. Here is it’s URL.


http://www.osti.gov/bridge/product.biblio.jsp?osti_id=7286

Click on the 1 MB PDF file icon. The discussion of algae begins on page 15.

Calvin reports that 86% of the dry weight of the algae is hydrocarbons, isoprene oligomers averaging n = 6 degree of polymerization. The structures include linear oligomers and cyclic structures related to steroids. They are not directly useable as transportation fuels.

The algae Botryococcus is among the slower growing breeds. It has a reported doubling time of two days. Presumably, producing hydrocarbons is harder than producing carbohydrates. Nevertheless, it is an interesting exercise in powers of 2 to calculate how quickly 1 g of algae can turn into the 100 million barrels of oil needed each day. Once you have the ocean surface carpeted with the algae, you can then harvest half the crop every doubling period in a self-sustaining manner.

One of your discussions (RR: e.g., this one) laments the fact that useful algae cannot generally compete with trash species. True, but farmers have learned how to grow crops and eliminate weeds. Farmers of the ocean will have the same incentives. Agricultural chemical companies have been very successful at finding selective herbicides for important crops. If growing algae becomes important, they will attack this problem as well.

Another possibility is to begin with an invasive species and modify it genetically to produce the hydrocarbons we want. Caulerpa taxifolia is an algae that escaped from a Monaco aquarium and now carpets the northern edge of the Mediterranean sea. When it also got loose from the Monterrey aquarium outside San Francisco, the U.S. government spent $8 million chlorinating the Pacific Ocean to eliminate the infestation. While it doesn’t make useful hydrocarbons, it does make a toxin caulerpenyne, which presumably is the secret to it success. The structure is available in Wikipedia. As the name suggests, it includes both double and triple bonds. It also has 2 acetates which according to biochemical studies are added last. The main chain contains 15 carbon atoms arranged in a way that suggests derivation from an isoprene trimer. Inhibit the acetylation steps and you have a precursor to diesel fuel. Adding the gene sequence to produce the hydrocarbons or disabling the genes that acetylate the product and you have another way to get at hydrocarbons from algae.

I believe conventional oil refineries could process this hydrocarbon mix to produce gasoline and diesel. Refineries could shut down much of their catalyst guard investment because these hydrocarbons have no nitrogen, sulfur, phosphorus, metals, or ash. This is an extremely sweet crude. These hydrocarbons should be able to replace coal as a fuel in electricity generating plants. Similarly, because it is a high quality fuel, much of the pollution abatement equipment at the back end could be shut down.

Check out the MIT Website Whatmatters for more details The URL is:

http://alum.mit.edu/news/WhatMatters/Archive/200111/

January 17, 2010 Posted by | algae, guest post, reader submission | Comments Off on Energy Policy and Renewable Hydrocarbons

Potential Markets and Benefits from Ocean Thermal Energy

Happy Thanksgiving to those who will celebrate it tomorrow. I plan to spend the long weekend with my family, and probably won’t be on here much.

In the interim, two things. First is that it is about time to start thinking about the top energy stories of the year. As in year’s past, I would like reader’s opinions on the top energy-related stories of 2009. I will put up a post late in December with the ones that I think are most significant.

Second, I present a guest post by Dr. Robert Cohen on ocean thermal energy conversion (OTEC). Dr. Cohen has been an advocate of OTEC for many years, and has posted a guest essay here previously:

Ocean Thermal Energy Conversion

There were some useful comments following that essay that I think explain the challenges for OTEC. Dr. Cohen has a website where he addresses OTEC in more detail, and his contact information is also available there.

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POTENTIAL MARKETS & BENEFITS OF OCEAN THERMAL ENERGY

Robert Cohen, November 24, 2009

Once the Obama Administration and the Congress put ocean thermal R&D back on a fast track, one that leads to the maturation of this technology within a few years, ocean thermal energy can foreseeably provide baseload electricity to energize at least three major geographic markets (see the ocean thermal resource map on the next page) in the following time-frames:

1) An early market to displace the use of oil, oil that is presently being burned to generate electricity in places like Hawaii, Puerto Rico, and in many developing countries. Places that are relatively accessible to the ocean thermal resource. Years ago we estimated that that early market could utilize about 50,000 MWe, which amount would achieve an oil savings of 2 million BBL/day [calculated @ 40 BBL/day per 1 MWe of ocean thermal].

2) A near-term market for electricity generated (for example) in the Gulf of Mexico and delivered via submarine cable to the U.S. electrical grid at points on the U.S. Gulf Coast, such as Key West, Tampa, New Orleans, and Brownsville. This source of baseload electricity could substantially implement the priority strategies advocated by Al Gore and T. Boone Pickens, which are aimed at providing renewable energy for propelling vehicles.

3) A potentially vast longer-term market for products derived from electricity generated aboard a fleet of ocean thermal plantships grazing on the high seas. Those plantships would convert the baseload electricity (plus air and water) to energy-intensive products such as hydrogen or ammonia, which could be shipped as energy carriers or as final products. For example, ammonia could be used as a hydrogen-carrier, combustion fuel, or for fertilizer.

Note that achieving the third option would mean that energy and energy-products could be shipped to the USA from domestically-owned ocean thermal plantships at locations that are in many cases closer to our shores than are many of our (often hostile) foreign sources of imported oil.

A global map of the OTEC Thermal Resource to supply energy to the above markets

This map shows contours of annual average temperature differences, in degrees Celsius, available in the world’s major oceans between surface waters and the cold water at 1000 meters depth that serves as a heat sink. The most desirable regions (bounded by the areas in yellow) are where that parameter equals or exceeds 20 degrees Celsius.

Energy FROM the oceans, to replace energy from ACROSS the oceans!

November 25, 2009 Posted by | geothermal, ocean thermal energy conversion, reader submission | 31 Comments

The Energy Conundrum

The following is a guest post by Paul Winstanley, the Director of Energy Initiatives from the Stevens Institute of Technology.

1. Introduction

This paper was written as preparation for the recent Discover and Shell sponsored “Fossil Fuels 2050” event in October 2009 at Stevens Institute of Technology, Hoboken, New Jersey.

Energy demand continues to increase rapidly. For example, the worldwide marketed energy consumption has been forecast to increase by 44% to 678 quadrillion British Thermal Units (BTUs) from 2006 to 2030 [1]. Within this period, fossil fuels (oil, natural gas and coal) are anticipated to remain the dominant energy source. Against this avaricious appetite for fossil fuel there is ambiguity over the reserves [2]. In addition to the issues associated with the demand for fossil fuels the environmental impact associated with burning these fuels is an equally large concern.

Therefore, the future energy challenge is complex and highly interdependent. Specifically, we need to:

  • Consider the continued availability of fossil fuels;
  • Whilst we introduce credible energy alternatives;
  • Whilst we ameliorate environmental damage.
  • These three themes will now be considered in more detail.

    2. Continued Availability of Fossil Fuel

    Exploration of hitherto difficult reserves will continue. This will be driven by increasing energy costs and the availability of new technology that enable economic exploitation. Examples of technological advances include:

  • Exploration in deep ocean water;
  • The production of hydrocarbons from oil sands and shale;
  • Directional drilling to access non-vertical reserves.
  • Additionally, there is considerable scope to reduce and prioritize fossil fuel usage. This approach will be different by sector and by time. For example, the short-term viable alternatives for aviation are very limited and it is only recently that flights partially supported by bio-fuels have taken place. This contrasts to personal and mass land transportation where credible alternatives such as hybrid and all electric vehicles already exist. Here greater usage of alternative fuel vehicles should be encouraged by policy whilst longer-term solutions for aviation are researched and developed.

    3. Credible Alternatives to Fossil Fuel

    The previous section raised the opportunity to reduce and prioritize fossil fuel utilization. Given the increasing energy demand, this approach can only be pursued if credible alternatives to fossil fuel exist.

    a. Bio-Fuels. Considerable emphasis has been placed on the development and implementation of bio-fuels. In this case the overall enterprise must be environmentally and economically acceptable. Specifically, issues such as increasing the price of food crops and increasing the utilization of other resources, such as water, need to be considered actively [3].

    b. Renewable Energy. Emphasis has also been placed on the development of renewable energies. With the exception of hydro-electricity the impact of renewable energy to meet the global energy demand has been minimal [4]. There are many factors that underpin this situation:

  • Renewable energy systems and supply chains can lack maturity;
  • There is no “silver bullet” renewable energy solution;
  • Generally, renewable energy systems are large complex installations (e.g. large wind farms) that demand significant capital investment and complex planning and permitting.
  • To overcome these limitations innovation is crucially required at all stages in the renewable energy enterprise. One innovative approach could be the systematic application of energy storage and renewable energy at a smaller scale as a micro-grid. In the residential context this could be applicable at a township level. The micro-grid approach has the potential to deliver rapidly increased energy security and resilience as well as enabling a significant reduction in emissions.

    One important consideration is where geographically renewable energy systems could be developed. Much emphasis has been placed on the future energy demands of emergent economies [1]. It is important to recognize that these economies are generally not hindered by legacy. This is illustrated by the growth in cellular phones. For example, from 1997 to 2007 in emerging nations the number of cellular phones increased 18 times faster [5] on average than landlines and a technological generation was by-passed. Of greater relevance to this paper is rapid growth in London, UK of electric vehicles as a consequence of the introduction of congestion charging (which electric vehicles are exempt from). The dominant supplier of electric vehicles in London is G-Wiz [6], an Indian manufacturer. Therefore, the location of renewable energy system development may result in technological surprise.

    4. Amelioration of Environmental Damage

    The previous section raised the opportunity for an innovative micro-grid approach to reduce emissions. This approach could have a significant contribution to meeting the future emissions targets. For example, in the UK approximately 80% of the carbon emissions arise from energy consumed in buildings and electricity generation [7].

    As well as introducing renewable energy, reducing energy demands has the potential to reduce carbon emissions further. Approaches to reduce energy demands include:

  • Target setting on energy suppliers;
  • More stringent construction codes;
  • Energy labeling to highlight to consumers more efficient appliance;
  • Improved product standards, for example, minimizing power dissipation from appliances whilst they are in a “stand-by” mode;
  • Energy performance certification prior to renting or selling real estate;
  • Smart homes including smart meters and appliances to better inform users about energy consumption in order to highlight areas for energy reduction.
  • Building upon the latter point, it has been estimated that the domestic energy demand can be reduced by an additional 25% [8] by integrating appliances or products into the home so they can turn off automatically when not required. A key requirement is to realize effectively these crucial savings in a manner that is transparent to the occupants. This can be achieved by embedding intelligence and communications into appliances and is an example of an emergent systems engineering discipline – “cognition-centric systems engineering”.

    In order to meet the required 2050 environmental targets it has been estimated that 1% of the global Gross Domestic Product (GDP) needs to be invested every year from now until 2050. Given the technological element of meeting these target a shortage of skilled and experience staff is probable. At a smaller scale, this limitation has already been identified in the USA as a consequence of Stimulus Package Funding with the Department of Energy [9]. To overcome this there will be an increasingly urgent need to increase the availability of training and re-training at the technician, undergraduate and post-graduate levels.

    5. Discussion

    This paper has made the case that the future energy conundrum is complex and highly interdependent and the continued availability of fossil fuels needs to be considered along with the introduction of credible alternatives whilst ameliorating environmental damage. Pursuit of part of this triad is likely to result in an incomplete or inappropriate solution set. Therefore, it is essential to solve the future energy conundrum holistically and systematically. Moreover, the scope of the future energy challenge dictates that:

    1. Innovation will be required continuously through the energy enterprise. This is innovation in the broadest sense, not just technical, and will encompass areas such as systems to business process to supply chain.
    2. Advances are likely to happen in emergent economies that are unconstrained by the fossil fuel legacy; technological surprise could become a reality.
    3. Unless we act now there is a high probability that there will be a shortage of skilled and experienced staff, at all levels from technician to post-graduate. If this situation arises we will not have the number of skilled staff to realize our aspirations and needs.

    Paul Winstanley, Stevens Institute of Technology, November 2009

    [1] Report #:DOE/EIA-0484(2009)

    [2] http://www.independent.co.uk/news/science/warning-oil-supplies-are-running-out-fast-1766585.html

    [3] http://www.iwmi.cgiar.org/News_Room/pdf/Down_to_Earth__Rise_in_biofuel_demand_could_trigger_food_water_crisis.pdf

    [4] http://www.renewableenergyworld.com/rea/news/article/2009/09/renewables-global-status-report-2009-update?cmpid=WNL-Friday-September11-2009

    [5] ITU REFERENCE

    [6] http://www.greencarsite.co.uk/GREENCARS/GoinGreen-GWIZ-EV.htm

    [7] http://climatechange.cbi.org.uk/uploaded/Roadmap_SummaryDistance.pdf

    [8] http://climatechange.cbi.org.uk/uploaded/CCT_010_Buildings_v2.pdf

    [9] http://www.renewableenergyworld.com/rea/news/article/2009/04/if-we-want-more-renewable-energy-in-the-u-s-wont-we-need-more-engineers

    November 5, 2009 Posted by | alternative energy, electric cars, guest post, reader submission | 24 Comments

    A High School Senior Asks About Peak Oil

    I tend to get a lot of e-mails, and I try to make a point to answer them all. Sometimes, the e-mail is a question that I can quickly answer. Sometimes it is a request for comments on a specific technology. But sometimes I get one that someone put a considerable amount of time in, and it warrants a very detailed and thoughtful response. I just received one like that that I felt was worth sharing with readers. I asked the writer for permission to publish it, and she agreed in the hopes that it can help others struggling with these questions, and hopefully spawn some fruitful discussion.

    This letter was written by a high school senior, and it is the sort of letter that makes me hopeful for the future. The letter resonated strongly with me, because I have been through some of the same thought processes as I worked my way through the implications of peak oil. I will insert my comments in the text as [RR: Comment].

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    Dear Mr. Rapier:

    Thank you for posting your email address at TOD! I apologize in advance for the length of this letter, but I just can’t seem to express my thoughts succinctly on this topic. I know you are a busy man, but I would greatly appreciate it if you could read and respond to my message and help put my mind at ease.

    I am writing to you to ask you some questions about peak oil. I am in my last year of high school and discovered peak oil by accident a few months ago. Like many people, I found Savinar’s site first, and of course my first reaction was one of terror. I stopped reading about the subject immediately to preserve my sanity. However, I knew I had to be honest with myself and keep investigating. Thankfully I found you and Stuart Staniford and all the others who believe that while some trouble may be coming, doom is not.

    [RR: There are a couple of things bound to frighten many people new to peak oil. One is is you find Matt Savinar’s site and read through it before you have read through anything else. Another is if – like me – the first book you read on Peak Oil is Jim Kunstler’s The Long Emergency. I read it and thought “Can things really get that bad?” My wife read it and concluded “There is no hope.” What I told her is that this is one view of how things might play out. Nobody knows the future, and I see my job as working to change the future so it doesn’t play out according to worst case scenarios. Incidentally, I have since met Jim Kunstler, and he doesn’t come across like a doomer in person. He is very charming and witty, and is generally a fun guy to be around. But his writings have scared a lot of people.

    On the other hand, if your introduction to peak oil is Peak Oil Debunked (which I often recommend to people who have become depressed over peak oil), you may come away with the impression that the post-peak world will be smooth sailing all the way. I don’t believe that (and I don’t think JD at Peak Oil Debunked does either). What I believe is that peak oil will present some upheavals and personal hardship for many people. Even if we have lots of coal and natural gas, the transition will be costly. I think what you are seeing in the economy right now is a taste of what a post-peak world will initially look like: Spiking energy prices that put a burden on people and keep us flirting with recession for many years.]

    However, I still have some concerns. Though I do not want to believe in doom, the doomers’ arguments tend to keep resurfacing in my mind and bothering me. On my good days I think, “We can pull through. It won’t be fun, but we can do it.” But on my bad days I think, “What if we can’t?”

    [RR: Over the years, I have gone through the same thought process. My undergraduate training is as a scientist, and one thing you learn as a scientist is to continually challenge your conclusions. In other words, conclusions are tentative. You have to be willing to ask yourself what kind of data it would take to cause you to change your position. If you find yourself fitting the data to the conclusion, or rationalizing away evidence that doesn’t seem to fit the conclusion, you have slipped from serious inquiry into dogma. In my view, many doomers are guilty of the latter.]

    In other words, I sound like you in your article “My Worst Fears”: doom is my worst fear, but not my expectation. Scenarios, like oil production, fall on a bell curve, with heaven on earth at one end and hell on earth at the other, and in a world in which many factors play into any given situation, it seems simplistic to me to just say, “Well, it’s absolutely gonna be the worst-case and we’re all gonna die.” In real life, the worst-case scenario almost never plays out and reality lands somewhere in the middle. However, that worst-case scenario has a habit of captivating the mind, especially when you’re like me and have no real ability to prepare for it. So I thought I’d write to someone who knows a lot more than me to get my questions answered. (I’m also including, at the bottom, a few of the reasons why I think the doomers are most likely wrong.)

    Who exactly are the doomers? Obviously, Kunstler, Heinberg, and Savinar are doomers. However, I had questions mainly about TOD in general and Simmons and Hagens specifically. Simmons, in most places, is called a doomer. However, I have heard him quoted as saying that humanity will “muddle through” peak oil. Does this mean that he is just a super-negative non-doomer? Or is he a doomer trying to tone down his position for the public?

    [RR: I am going to be quite critical of Simmons here. Fans of his shouldn’t consider this Simmons-bashing; I just think this needs to be said. I definitely consider Simmons a doomer. I also consider him to be alarmist much of the time. I understand very clearly his desire to have people take this issue seriously, but lately he has latched onto some pretty skimpy evidence and run with it. (I thought it extremely ironic that he recently accused others of running off on a tangent based on skimpy data). The problem is that he takes a little bit of information – which he sometimes doesn’t understand very well – and then draws sweeping conclusions. Many – even some of his allies – acknowledge the contribution of Twilight in the Desert, but they question whether he isn’t doing more harm than good at this point.

    An example of that – which I have discussed before – was his talk at last year’s ASPO conference. He claimed in his presentation that we don’t have a good idea of our gasoline inventories, and were just beginning a gasoline crisis that could bring the entire country to a halt. He spun quite a frightening tale, and I could see the shock on some people’s faces. Such shock tactics may work to get people’s attention, but if you cry wolf a few times they backfire.

    Contrary to Matt’s argument, the evidence was just the opposite. Even as he was speaking, refineries were coming back online from hurricane outages and inventories were recovering. I was asked about Matt’s comments on a later panel session, and I said I thought gasoline inventories were beginning to recover and that they would be higher in a month. They were. Further, I noted that I was previously in the group that submitted weekly gasoline inventories from our refinery to the Department of Energy, and that we actually have a pretty clear idea of what gasoline inventories looked like from week to week.

    Another example is his argument about the $100 trillion corrosion issue in the oil industry. The gist is that he argues that the oil industry is full of rusting infrastructure, and he questions whether we have the money or even the iron resources to fix the problem. Further, he questions aloud how it is that he – Matt Simmons, investment banker – has ‘discovered’ this problem that the oil industry has missed. I won’t go into all of the reasons that Matt is way off the mark on this, as that would be an essay in itself. A corrosion engineer at The Oil Drum has weighed in on this issue, and explains that corrosion is well-understood, and not actually something that Simmons just discovered. Oil companies are full of corrosion engineers who work to replace corroded equipment as needed. There was actually a lot of behind the scenes discussion on how hard to rebut Matt on this, as many felt like this warranted a sharp rebuttal. In the end – because he is considered to be a friend of TOD – he was treated much more gently in public than he was in private.

    I did not attend this year’s ASPO conference, but I did get an e-mail from someone who saw his presentation. This from a friend and long time acquaintance of Matt: “Matt Simmons was NOT worth seeing. he seemed a bit crazy – not much new.”]

    Obviously you and Staniford are not doomers. I have also seen Kjell Aleklett and Robert Hirsch distance themselves from the doomers. You mentioned that Nate Hagens was not a doomer, and that he wanted to use the term “resource depletion” rather than “peak oil” because peak oil was virtually copyrighted by doomers. However, when I read some of Nate Hagens’ articles at TOD, they sounded remarkably doomerish! I thought, since you know the man, you could tell me what his position was (since, as a student, I have no time to sit on my computer all day and read nothing but peak oil articles).

    [RR: Nate is a friend of mine, and I feel like I know him fairly well. His big interest is in human psychology as it relates to peak oil – and I have suggested to him that he distance himself from the phrase “peak oil” because of some of the connotations it has taken on. Nate doesn’t expect people to collectively do the right thing, and as such he is more doomerish than I am. Funny story about Nate is that his original moniker at TOD was “The Last Sasquatch.” I liked a lot of his writing, and talked him into posting under his real name. I told him that he would be taken more seriously that way. He ultimately did start posting under his real name, and gained a lot of credibility as he continued to write. Nate talks about that decision here. But on a scale of 1 to 10, with 1 being extreme doomer, I would consider Nate to be about a 3 or 4. I consider myself to be about a 6 or 7 – fairly optimistic, but also realistic that it won’t be a piece of cake. Five years ago I was a 5.

    By the way, I got to spend some time with Bob Hirsch at last year’s ASPO. I can definitely relate to his thinking. He considers the problem very serious, but something we can painfully work our way through if we get busy. That pretty much reflects my own thoughts.]

    TOD in general seems to be a semi-doomer site. It sounds as though it used to be balanced, but shifted at some point. Consequently I only read a few contributors, and rarely touch the comments, which usually degenerate into debate about very fine points that I don’t understand or turn into “when you’re starving to death you’ll see that I’m right.” Which of the main contributors over there are doomers? Because sometimes it’s hard to tell. (By the way, I define “doom” to basically mean “die-off and/or Industrial Revolution reversal scenario.”)

    [RR: I don’t want to name names, but very few of the ‘staff’ there are doomers. But two of the most frequent contributors are, and that may make TOD staff seem more doomerish than we really are on average. The readership, I think, does tend toward the doomerish end of the scale, but you have people all over the spectrum. And I can tell you through my own experiences that some doomers feel personally affronted if you challenge some of their views, and are vocal about it. This was also Stuart’s experience right before he stopped posting. He posted some articles forecasting that the future might not be complete doom and gloom, and he got some venom thrown his way. That is why I post there infrequently.]

    Source of Aleklett/Hirsch/Simmons statements (dated May 2005, from attendee at Uppsala peak oil conference): [Simmons, Aleklett, and Hirsch] think Peak Oil is a very grave issue, but they also think the doomers are wrong. On a specific question they said Richard Heinberg was very much too pessimistic. They meant Heinberg was too pessimistic on technology and society. They didn’t believe that the end of the world was near, but that we would, and I quote, “muddle through.” They said we might have a few rough decades but that world will not end. For example, Aleklett was asked if he believed airborne mass tourism would continue in the future. He answered that sailing boats are very nice.

    Is there any mathematical possibility of world decline rates approaching 8-12%? Doomers seem to throw these numbers around as though they are gospel truth. However, I have never seen a doomer actually lay out the math behind their enormous decline rates. I have only ever seen people in comments confuse field decline rates with world decline rates. Also, I have never heard any leading peak oil expert (except Simmons) predict anything worse than maybe a 6% decline rate. In fact, JD worked out Aleklett’s latest release and found that he was predicting a .5% annual world decline rate!

    [RR: As you mention, individual fields can decline at those rates, but as prices rise different technologies can come into play that allow more oil to be extracted and so observed decline rates may be less than what would be observed in a constant oil price environment. But this may also accelerate the decline when it really begins in earnest. I was at the annual Energy Information Administration conference last April and in one of the presentations a slide was presented that showed that decline rates are climbing. See Slide 6 here.]

    There is also a more specific question I want to ask you on this same topic. Freddy Hutter (at the Trendlines website) posts innumerable graphs and checks peak predictions and such. While I disagree with his “superabundant” scenario, his site is useful for getting the lastest predictions from leading people. He stated this (on the right side of the page under “worst-case scenario”):

    Using the lowest recognized estimate of All Liquids (2021-Gb by EWG/LBST 2008), and assuming 2008 (85.4-mbd) as Peak Year, this projection depicts the Avg Decline Rate of 4.6% required mathematically to exhaust this conservative URR. The significance is that half of this year’s volume will still be available in 2035, and flow won’t dip below 10-mbd until 2055. Finally, All Liquids exhausts in 2083. A post-peak production decline rate higher than 4.6% “strands URR”…and that phrase is an oxymoron. Ignore all pundits that suggest a post-peak average extraction decline rate of over 4.6% in their musings. And please read their alarmist TEOTWAWKI forecasts with these hard numbers in mind.

    Is this anywhere close to true? What is “stranding” URR and why is it an oxymoron? Since I agree with Staniford’s assessment that the decline rate is largely what determines the severity of the scenario, I would much rather side with Hutter and the “cornucopians” (a word I hate due to its pejorative application to anyone who is not a doomer), but I need to know if this is really true or not before I do that.

    [RR: I think what he means is this. URR is the amount of oil that is ultimately recoverable with current technology. Assume for a moment that URR is estimated to be 100 units. Assume what has been produced is 50 units, and 10 units are being produced in the current year. Now assume for the purpose of illustration that the presumed decline rate is 50%. So then your cumulative recovery based on that decline rate might be something like 50 at the beginning of Year 1, 60 in Year 2, 65 in Year 3, 67.5 in Year 4… We already said that URR was 100, but it doesn’t look like we can get there with that presumed decline rate. So what has happened is too high of a decline rate was presumed which results in a cumulative production rate that will ultimately fall short of present URR estimates. Hence, the oxymoron.]

    What is Hubbert Linearization and what is it good for? Some people seem to hold up HL as though it can work miracles, and some people seem to throw it in the trash heap. However, I have noticed that it seems to be used two different ways: to either predict a region’s peak, or predict the post-peak decline rate. You have come out against its use to predict a peak, but Staniford’s article on a slow world decline rate was based entirely on the second usage of HL. Since JD linked to this article as one of the main arguments in favor of a slow decline, I’d like to know if HL can be properly used this way, or if it useless here too.

    [RR: And I can tell you that Stuart definitely agrees with me on the issue of using it to predict peak. He has stated this publicly and we have corresponded about it a great deal privately. What has happened here is something I often see. Someone has a theory. They think their logic is impeccable. They start using the theory to make predictions. But they never bothered to validate that theory by plugging in known data to see if it gives the right answer. In the case of HL, I did that and showed that it gave wrong answers more often than not. Hence, using HL to predict a peak is akin to astrology as far as I am concerned.

    I have seen this before with relatively inexperienced engineers. They build a model, and start to use it without validating it. But models must be validated. That’s the only way you can have some confidence in the model predictions. (Then there are those who hear the word “model” and they immediately discount the results. That is also the wrong approach).

    Because that article by Stuart was written very early on – and Stuart did modify his views on HL as time went by – I can’t really say whether HL gives reasonable and consistent answers on decline rates. I can’t say I have done those checks.]

    Vis-à-vis Staniford’s article, how will world economic troubles affect peak scenarios? I am of the opinion that it is very possible that a major depression is looming sometime in the next decade, what with the credit contraction and stock market losses. Obviously a depression would kill oil demand, which might soften peak initially. However, it would also kill funding for alternative energy projects and other mitigation efforts. While I am still not convinced this necessarily spells doom, it could make the transition much more painful. I wonder if the initial depression (economically-induced and having nothing to do with energy or oil) would kill the demand and funding, and we would then stumble our way through recession after recession as peak “ripples through” until suitable alternative technology is developed. Does this sound even remotely accurate? Because the “worst fears” part of me is deathly afraid that a depression now, at the “critical moment,” could trigger the doom scenario. Staniford did not seem to think this, and neither did any of the commenters (early on, at least; I didn’t read the whole thread).

    [RR: I think it all ties together. A sharp peak will cause an initial supply shortfall that will result in spiking prices which can cause recession/depression – as well as a drop in funding for renewables. This will cause demand to fall, which will cause prices to fall. Demand then picks back up, and we repeat the cycle. Due to reduced funding for alternatives in troubled economic times, the longer term mitigation options are endangered. This is how I foresee peak oil. It will cause economic troubles, which will feed back into demand. The ultimate impact is that oil will last longer than had the peak not resulted in economic difficulties. This was my premise in The Long Recession.]

    Reasons I think the doomers are wrong/suspicions about doomers (in no particular order):

    1) The track record/statistics of doom. People have always made doomsday predictions. Since civilization still exists, they obviously did not come true. First it was a global ice age earlier this century, then it was nuclear holocaust, then it was Y2K, etc. Now it is peak oil, or by extension resource depletion. While I understand the gravity of the concerns behind this latest doomsday “fad,” I am just not convinced that doom will play out, due to both their track record and to the mere probability of the event. The bigger and more severe the event, the probability necessarily goes down (like the probability of a major Gulf Coast hurricane vs. the probability of a meteor hitting the earth tomorrow). And doomsday is of necessity a very large and very severe event, pushing the chances down into the realm of the highly improbable. However, I do understand that statistics must be weighed against reality.

    2) The lack of presented mathematical evidence for huge world decline rates.

    3) The strange distribution of professions amongst the major voices of peak oil. Most of the more optimistic voices in the community seem to have been connected to energy at some point. They are either geologists or in some oil- or energy-related profession. However, the major doomers seem to be either journalists or lawyers, neither of which are energy-related jobs. I question the expertise of these people, especially when their predictions seem to flop so often and so spectacularly. They strike me, overall, as the sort of “annual prophets” who make negative predictions like clockwork, and whose followers seem to get yearly amnesia when their hero’s predictions are totally off the mark.

    [RR: Geologists are pretty well-represented in the doomer camp. Think of people like Ken Deffeyes and Collin Campbell. And of course many doomers gain strength in their convictions from Hubbert himself, who was also a geologist.]

    4) The “dark side” of peak oil. You don’t have to dig too far into any issue related to resource depletion before you find these people. The people who post things like “only the fit in our society should be allowed to have children” and “we should euthanize the handicapped” and “it’s cruel to be altruistic because it props up the weak,” etc. Obviously these people are all doomers, though not all doomers fall into this category.

    [RR: While I view those people as a tiny minority, it has always bothered me that so many doomers can casually talk about billions of people worldwide dieing off as a result of peak oil. My mind can’t even comprehend such a horror, yet people toss that around as casually as if they were debating whether to have a second helping of lunch.]

    5) Large amounts of other fossil fuels to “ease us into” the transition. There have now been huge natural gas discoveries under Texas and Louisiana, and if they turn out to be anywhere near as big as they say, it is, as one of your commenters put it, “nearly unalloyed good news.” Coal is even more abundant. From the EIA Coal Reserves page:

    As of January 1, 2008, the DRB (Demonstrated Reserve Base) was estimated to contain 489 billion short tons [of coal]. In the United States, coal resources are larger than remaining natural gas and oil resources … Worldwide, compared to all other fossil fuels, coal is most abundant and widely distributed across the continents. Estimates of the world’s total recoverable reserves of coal in 2004 were about 998 billion short tons. The resulting ratio of coal reserves to production is approximately 164 years, meaning that at current rates of production (and no change in reserves), coal reserves could in theory last more than one and one-half centuries.

    From Wikipedia’s coal article (not sure if this information is reliable – it’s Wikipedia):

    At the end of 2006 the recoverable coal reserves amounted 800 or 900 gigatons. The United States Energy Information Administration gives world reserves as 930 billion short tons. At the current extraction rate, this would last 132 years. However, the rate of coal consumption is annually increasing at 2-3% per year and, setting the growth rate to 2.5% yields an exponential depletion time of 56 years (in 2065). At the current global energy consumption of 15.7 terawatts, there is enough coal to provide the entire planet with all of its energy for 37 years (assuming 0% growth in demand and ignoring transportation’s need for liquid fuels).

    Of course, I do recognize that burning that much coal would result in a very bad spike in pollution (I am not yet convinced of the science behind global warming). However, it seems like more than enough to help us “limp along.” (One question about the coal, though: on my first and only visit to the Energy Bulletin website, I saw Richard Heinberg saying that a new study said that we only have 15 years of coal. I wonder if this is true – it is Richard Heinberg, after all. Have you heard of this?)

    [RR: I had not heard Heinberg say this, but if he did I think he is wrong. I think one thing that is really going to help us transition away from oil is that we do seem to have substantial natural gas reserves. Natural gas is far more fungible as a transportation fuel than are things like coal, biomass, wind, or solar power, so it should buy us time. Hopefully we don’t squander that time. Of course if our coal reserves are as significant as is often claimed, CTL is a longer-term option for producing liquid fuels, albeit at a higher price point than we are accustomed to.]

    6) All major doomers seem to be Americans. Now I am an American, so this is not American-bashing. However, it does make me wonder if, by living in this country, these doomers have a slightly lopsided view of the world (as regards usage and perceived “needs”), since no doomers seem to be coming out of “emerging” countries like China or India or even out of Europe. Notice also how almost all peak oil discussions seem to degenerate, often unknowingly, into “Americo-centric” scenarios (“the U.S. economy will implode,” “the U.S. dollar needs oil,” etc.).

    [RR: I had never made this observation, but that does seem to be generally correct (although I do know of doomers who are European or Australian). Maybe this is because we Americans use so much oil, and our way of life is more dependent on oil than is much of the rest of the world. I have always felt like this makes us more vulnerable to oil shortages and oil price shocks. So perhaps it is just that we see the implications of peak oil as being more serious, because for us they may very well be more serious.]

    Sorry again for the length of this message. I hope you can help me sort through my confusion. By the way, I love R-squared Energy Blog. It is a voice of moderation in a corner of the interent gone mostly mad, and it is nice to hear that not everyone is a doomer.

    [RR: Thank you for your e-mail. As I said, it gives me hope for the future that you are so thoughtfully weighing these issues. Good luck on your quest for the truth. Just keep in mind that ultimately none of us know how the future is going to play out. Personally, I consider a number of possible scenarios, and I plan accordingly. Some of those scenarios including asking questions like “What if Matt Savinar is right?” Ultimately, I think you have to plan for some of the scenarios you think are low probability in the same way that you buy homeowner’s insurance for a house that you don’t believe will ever burn down. You do have to draw a line somewhere, though.]

    October 18, 2009 Posted by | Jim Kunstler, Matt Simmons, Peak Oil, reader submission | 47 Comments

    Answering Reader Questions 2009: Part 3

    This was supposed to be the final installment of answers to the questions recently submitted by readers, but the answer to the first question went a little long. Here are the links to the previous installments:

    Answering Reader Questions 2009: Part 1

    Answering Reader Questions 2009: Part 2

    This installment covers advice to prospective engineering students, but I was also asked about books. If you get me started on books, then I may end up writing more than intended and that’s what I did here. So I only got the one question answered, and then listed 20 books that I have really enjoyed over the past few years.

    The Questions

    Anonymous wrote:Your advice to engineering students or students to be?

    For your broad experience and unique perspective, what is your advice to young students undertaking engineering coursework – what subjects and courses should they pay particular attention to, what electives should they take, what counseling from academic engineers can they forget, what activities outside of coursework will set them up well for a productive, rewarding engineering career?

    Any particular schools serving their students notably well and any that are notably not?

    What are the top ten engineering, business or life related books that they absolutely must read on their own?

    What are the emerging career opportunities to shoot for and what are the dead ends to avoid? Answer

    The Answers

    Answer

    First, you may have seen the recent CNN story on Most Lucrative College Majors. While engineering dominated the list, even the non-engineering entries like computer science are heavily dependent upon math. So my first piece of advice is to make sure you have a good grounding in math, as it is the foundation for so many of the top-paying degrees. Beyond math, of course the hard sciences like chemistry and physics are key.

    I would suggest that more important than getting a good grounding in math and science is to be sure this is the sort of thing you enjoy. I have seen too many people get into the field because that’s what their parents wanted, or because that was a dream since they were a child. But in reality, math and science wasn’t their passion. Sticking with something when it isn’t the right fit isn’t something I would advise. You should do something you enjoy if you possibly can, even if it means you aren’t maximizing your earning potential. If you love what you do, the work day will fly by quickly. If you hate it, then time will creep by.

    Regarding schools, I would try to stick with a good, Tier 1 school if you can afford it. It’s not that the lower tier schools don’t have plenty of good graduates, but a lot of the major employers won’t recruit at the lower tier schools. US News and World Report currently had their 2009 Best Engineering Schools list out, and if you want to tilt the odds in your favor, make good grades at a highly ranked school. Just scanning the Top 50, I don’t think you would go wrong with any of them. Tilt the odds further in your favor by doing a coop or internship.

    With respect to emerging career opportunities, it will initially be important for you to just get some experience. Personally, I would try to get in with an established company so you can get some good career development early on. After 5 years or so, you may want to survey the horizon and see what’s out there. There are certainly a lot of good jobs at small firms, but this can be hit and miss. You could end up at a small firm without the infrastructure in place to support your career development. If you decide to go with a small company, just be sure that they are well-capitalized and there are people in place to develop you. No matter where you are, if you aren’t being developed, don’t stay.

    The question on which books to read is a tough one, because there are so many that I have enjoyed. You may know that I love to read, and in fact have kept a reading blog for the past few years. I read all sorts of stuff, and I generally make it through 20 or more books a year. It is hard to pin it down to a few, but I scanned the list from my reading blog and pasted some in below that I really liked for one reason or another.

    This list is not limited to engineering or business books. They cover a broad range. I really like books that are capable of shifting paradigms, or otherwise making me feel like my mind had been expanded (even in cases where I disagree with a lot of the book, as was the case with Singularity). But here are some of the books that I thoroughly enjoyed, that taught me something important, and/or that caused me to look at things in a different light. The list is in no particular order.

    1. The Black Swan: The Impact of the Highly Improbable by Nassim Nicholas Taleb

    2. Collapse: How Societies Choose to Fail or Succeed by Jared Diamond

    3. The Third Chimpanzee by Jared Diamond

    4. 1491: New Revelations of the Americas Before Columbus by Charles C. Mann

    5. The Singularity is Near by Ray Kurzweil

    6. Oil 101by Morgan Downey

    7. Planet India: The Turbulent Rise of the Largest Democracy and the Future of Our World by Mira Kamdar

    8. Gusher of Lies: The Dangerous Delusions of Energy Independence by Robert Bryce

    9. Big Cotton: How A Humble Fiber Created Fortunes, Wrecked Civilizations, and Put America on the Map by Stephen Yafa

    10. How to Grow More Vegetables and Fruits (and Fruits, Nuts, Berries, Grains, and Other Crops) Than You Ever Thought Possible by John Jeavons

    11. First, Break All the Rules: What the World’s Greatest Managers Do Differently by Marcus Buckingham and Curt Coffman

    12. A Beautiful Mind : A Biography of John Forbes Nash, Jr. by Sylvia Nassar

    13. Isaac Newton by James Gleick

    14. Churchill: A Biography by Roy Jenkins

    15. DNA: The Secret of Life by Andrew Berry and James Watson

    16. The Time Traveler’s Wife by Audrey Niffenegger

    17. Cryptonomicon by Neal Stephenson

    18. Spin by Robert Charles Wilson

    19. The Meaning Of It All by Richard Feynman

    20. Nanofuture: What’s Next for Nanotechnology by J. Storrs Hall

    Incidentally, if you like science fiction (and I do because good science fiction can really open up the mind), some of the greatest books in that genre are Hyperion and the sequels, A Fire Upon The Deep and A Deepness in the Sky by Vernor Vinge, and almost anything by Alastair Reynolds. I would also like to open the list up to reader suggestions. What are some really great books that you recommend that I am missing here?

    Return to Top

    OK, looks like I probably need to get to the rest of the questions in another essay.

    August 7, 2009 Posted by | book review, reader submission | 7 Comments

    Rate Crimes: Impeding the Solar Tipping Point

    The following guest essay was written by Paul Symanski. Paul is an electrical engineer with expertise in solar energy, and shares his views on why solar power often faces unnecessary headwinds.

    —————-

    To anyone who has ever spent a day in Arizona’s Valley of the Sun, it is obvious. The sunniest state in the nation is blessed, cursed, with a fierce sun. Yet, as one explores the landscape, artifacts of the capture of solar energy are conspicuously absent. This dearth is true for solar electric, domestic hot water, passive solar design, and even for urban design. It is as if the metropolis stands in obstinate defiance against the surrounding desert and its greatest gift.

    Yet, the incessant sun is a constant agitator. Even visitors happily distracted by the Valley’s many amenities will remark while lounging by the pool, drinking in the clubhouse, or enjoying a repast on a misted patio, “Why doesn’t Arizona use more solar energy?”

    Solar Tipping Point

    One answer to this persistent question can be found once one comprehends that Arizona is where it first occurred: where solar energy first became economical.

    Around the turn of the millennium, four decades after its destiny was foretold, an investment in electricity generated by an on-site photovoltaic system became a better investment than traditional investment vehicles. Finally, solar energy had become economically transcendent. Because of its abundant solar resource, solar energy’s transcendence occurred in the center of the desert Southwest, in sunny Arizona. It may not be mere chance that this tipping point coincided with the world’s peak production of petroleum.

    The concept of “grid parity” has been promulgated by an energy regime that sees the world through grid-centric eyes. A more accurate and revealing comparison is investment parity. This approach more completely – and perhaps more directly – accounts for the myriad hidden costs embedded in the economics of the world’s energy system. Both the recent economic troubles and the fact that the solar tipping point occurred during an historical low for electricity prices in Arizona reinforce the validity of economic ascendancy of solar energy.

    Implicit in the concept of grid parity is an ultimate arrival where both sides rest in balance upon the fulcrum. This subtle point of terminology further invalidates the utility of the concept of “grid parity”. The balance will likely be a brief moment of hushed breath . . . before the tipping continues in favor of solar energy.

    The concept of grid parity also establishes a false dichotomy that reveals the term to be an indirection. Solar energy should be one of a multitude of energy sources to be impartially and intelligently incorporated into a flexible network of energy sharing. The concept of grid parity is a creation of a hierarchical system of centralized generation and distribution. Like the system that created it, the term ‘grid parity’ should be recognized for what it is.

    The concept of a tipping point is a more appropriate metaphor. It is this tipping point that those favored by the status quo vigorously resist.

    Delay Tactics

    It is crucial that energy costs be accurately accounted in order to establish valid policies. Yet, in any forum where energy is discussed (present company excepted), retail energy costs are typically presented as an average, or as a range of values. Even in conversations amongst economists, engineers, scientists, business leaders, policy makers, and others who help guide our energy future, superficial valuations proliferate. Blunt statements of cost nearly always exclude associated economic, competing, and externalized costs. More dangerously, such simplification disguises a complex and telling reality.

    The key observation – and the linchpin of the Rate Crimes exposé – is that the avoided cost value of solar electricity and other energy management strategies has long been dramatically lower than the retail cost of electricity under particular rate plans.

    The graph below plots the avoided cost value of on-site solar electricity against retail energy costs under the Arizona Public Service E-32 commercial rate schedule for the summer season. The ranges of kilowatt demand and kilowatt-hour consumption reflect those of small businesses.

    The avoided cost value of solar electricity is half that of the retail cost of electricity for a great portion primarily because of the uncontrollable billing demand, and a precipitous declining block rate structure compounded by the uncontrollable billing demand being used as a multiplier for the extents of the expensive initial block.

    Of the hundred largest electric utilities (by customers served), fourteen are located in the sunny Southwest (excluding the unregulated utilities in Texas).

    Of these fourteen, three have commercial rate plans with structures that most defeat the value of solar energy and energy conservation measures. These utilities are: Arizona Public Service, Salt River Project, and Tucson Electric Power. All are Arizona utilities.

    Conclusion

    The Arizona rate schedules provide an enormous subsidy and encourage prodigal consumption by discounting energy to the largest energy consumers. This was historically a common situation in other places as well. However, Arizona is special due to its extraordinary solar resources.

    The pricing system redirects costs from any apparent savings in the residential and industrial sectors into the small commercial sector. Small commercial ratepayers have less capital, have fewer person-hours to commit to unusual projects, have less-diverse expertise, and are often constrained from making modifications to their premises. The redirection of costs into this captive market creates a hidden tax through the higher costs of goods and services, and through the subsequently higher sales tax charges.

    Furthermore, while more fortunate homeowners can avoid energy costs by investing in subsidized solar energy, renters remain a captive market.

    As you may surmise, nearly the entire Arizona economic and political system is complicit. Beyond Arizona’s borders, the state’s electricity generation from coal and nuclear sources remains the West’s dirty little secret. Environmentally conscientious Californians can nod appreciatively at their Tehachapi and San Gorgonio Pass wind farms; while behind the turbines, on the eastern horizon, the cooling towers and smokestacks of Arizona keep bright their nights.

    All Arizonans need to be able to gain full value for investments in energy conservation and in solar energy. Until Arizona’s repressive rate schedules are reformed, energy efficiency measures and solar energy in the nation’s sunniest state will have diminished value. This diminishment of the value of solar energy affects all of us by delaying a cleaner energy future.

    —————-

    Paul Symanski is an electrical engineer, designer, human factors specialist, marketer, machinist, graphic artist, musician, LEED AP, and economist born of necessity. He is experienced with renewable energy, including expertise in solar energy both in practical application and in the laboratory. He is also a competitive masters-level bicyclist. ratecrimes [at] gmail [dot] com

    http://ratecrimes.blogspot.com/

    August 6, 2009 Posted by | analysis, Arizona, avoided cost, distributed energy, economics, guest post, investment, rate schedule, reader submission, smart grid, solar power | 53 Comments

    Off to Canada, but the Floor is Open for Questions

    I am flying to Alberta in the morning and will be there through the middle of the week, trying to learn more about the renewable energy opportunities there. I doubt I will put up anything new until I return. So I thought this might be a good time to solicit questions readers may have. I know that I don’t always address all questions in the comments, so if you have one that I have neglected, you can ask following this post and I will answer when I return.

    The last time I asked readers for questions, I got 30 or so that I answered in the following two posts:

    Answering Questions – Part I

    Answering Questions – Part II

    That’s been almost two years, though, and there have been lots of interesting developments since then. So ask away, and I will answer to the best of my ability. Other readers are certainly welcome to offer their own answers to questions, and in some cases I may use something from the comments when answering.

    One thing I will throw out there is that on Friday, July 17th I am supposed to speak to POET about their cellulosic efforts (which I mentioned in a recent post). I have a list of things I want to ask them about, but if you have something you would like me to ask them, please post the question here and I will ask for you provided it is topical.

    Until then, please behave yourselves. 🙂

    July 12, 2009 Posted by | POET, reader submission | 109 Comments

    Repost of TDP: What Went Wrong

    The is Part II of my look at Changing World Technologies’ thermal depolymerization process. This essay came from a reader, and was originally posted on April 12, 2007.

    But I also want to add some comments that regular reader “Optimist” added following the previous essay. First, those comments:

    The 85% efficiency claim is based on a faulty mass balance. The faulty mass balance is the basis for an equally faulty energy balance. You can verify by comparing production data (bbl oil/ton of waste) to the mass balance (still) presented by CWT.

    Contrary to what the breathless writers at Discover magazine believe, this technology is good only for recycling lipids (fats and oils) and the fat-soluble amino acids in protein. To understand why you need to follow the process flow diagram, which consists of three key steps:

    1. Thermal Depolymerization (aka Dilute Acid Hydrolysis – yes, the process uses sulfuric acid).
    2. Separation of water and fat/oil.
    3. Decarboxylation of fatty acids to yield hycrocarbon (diesel) product.

    Anything soluble in water goes into the effluent in step 2. That includes (but is not limited to) all carbohydrate and the bulk of the protein hydrolysis product (amino acids).

    CWT cleverly states that this makes the effluent a high quality fertilizer. Probably true. But that high quality fertilizer contains BTUs not available as fuel (the main product).

    Another comment from Optimist:

    To their credit, Discover magazine did raise another issue: product quality: Fuel quality was another challenge. Changing World Technologies‘ thick, tarry fuel resembles boiler-grade fuel oil. One prospective buyer insisted on what the company called “unacceptable pricing terms” for its relatively unproven product. In the end, CWT sold only 93,000 of the 391,000 gallons of fuel it produced and earned just 99 cents for each one. At the time, wholesale fuel oil distributors were raking in $2.50 to $3.30 per gallon. Even with the $1-per-gallon U.S. biofuels tax credit for every gallon sold, Changing World Technologies paid more for Butterball’s turkey offal than it earned back in revenue. (Accounting for all its operating costs, the company lost $5,003,000 in the first quarter of 2008, though operating at a loss is not uncommon or necessarily a very bad sign for a technology startup.) Emphasis added.

    Don’t worry – I’m sure next year they’ll be printing money…

    In light of this, I am not sure why they think it’s a good idea to do an IPO now.

    Now for the essay from a reader who provided some very specific details on what went wrong. He included a presentation in which he referred to several slides, and I will pull those out and post them so the references are clear. I will also insert some comments in the text [like this].

    —————————————

    Robert,

    I enjoy your blog quite a lot. Intelligent analysis is rare. Coupled with unbiased interpretation it is almost an unknown.

    Saw your discussion of TDP/TCP. Pretty much spot on. As a chemical engineer I thought you’d be interested in some deeper insights of how the process works. This is all information that used to be available on the web, but most of it has been removed.

    Start with the lecture (attached) by Terry Adams, CWT technical officer at MIT in April 2005 – best TDP technical article I know of [I have searched for an online version of this, but to no avail. Perhaps using the Wayback Machine one could locate an online archive of the original presentation]. The way I understand it, the process basically consists of two thermal treatment steps. The first step (slide #13) is a low temp/high pressure step that causes hydrolysis of all the biological material. A check of steam tables confirms that pressure is just high enough to maintain liquid water at the temperature given.

    Slide 13 of “The CWT Thermal Conversion Process” Presentation

    The first stage is followed by separation (slide #3).

    Slide 3 from “The CWT Thermal Conversion Process” Presentation

    As indicated in slide #14 they have a clever way of flashing off some of the water and then using the steam to heat the feedstock [This sort of heat recovery is standard practice in the petrochemical industry]. This is at the heart of their claims about high efficiency: the steam is condensed, so most of the water in the feedstock is discharged as liquid. Calling it distilled water, is of course salesmen talk that would make a used car salesman’s eye’s water.

    Slide 14 of “The CWT Thermal Conversion Process” Presentation

    But take a closer look: After separation only the “organic oil” goes to the second stage. After full hydrolysis (let’s just assume that for now) what monomers would be part of the organic oil? Fatty acids barely make it into this oil, due to the little known fact (see flow diagram on slide #11) that sulfuric acid is used to aid hydrolysis [If I had known that, I had forgotten about it. That does put quite a different spin on the whole process]. (DOE would call the first stage by another name: Dilute Acid Hydrolysis). Some fat-soluble amino acids. That’s it. (I bet you can figure out what cellulose fed to these two units would yield…) [It would interesting to see some yields on this. What I would really like to see is what they get if they threw corn in there. If their energy balances are really good – and even with all that has gone wrong they appear to be better than for corn ethanol – then I would like to see some experiments in that direction.]

    Slide 11 of “The CWT Thermal Conversion Process” Presentation

    Of course, CWT are master salesmen. The water-soluble amino acid and glycerol solution is not waste: it is a wonderful liquid fertilizer (slide #23). Talk about taking a lemon and making lemonade…

    Slide 23 of “The CWT Thermal Conversion Process” Presentation

    So, the “organic oil” goes to the second stage (high temperature/low pressure) where the fatty acids are decarboxylized (to yield oil) and some of the amino acids are deaminated and decarboxylized to yield who-knows-what (slide #15, point 2).

    Slide 15 of “The CWT Thermal Conversion Process” Presentation

    You raise the question of how on earth did CWT get their cost estimates so wrong. Well, a large factor in that would be overestimating yield (and per extension efficiency). CWT has long claimed that TDP has an energy efficiency of 85% (heading slide #12). Right there you smell a skunk. Now the dirty details.

    Slide 12 of “The CWT Thermal Conversion Process” Presentation

    The mass balance, slide #11 [posted earlier], shows that CWT probably did not take the CO2 that results from decarboxylation into account. This causes them to overestimate fuel production. You can easily do the calc’s I’m sure, but it is spelled out here. Apologies for the format, got mangled when they changed their format [That thread was a very good discussion on this issue; perhaps I will pull it out, reformat it, and post it at some point].

    The energy balance, slide #12, does not include the energy present in the “liquid fertilizer”. What, all that glycerol and amino acids contain no energy? The water vapor also presents energy lost, even if it’s not much.

    The mass and energy balances actually date from a previous publication (February and March 2004), also attached. One would expect that CWT would have discovered the error in the interceding year, and corrected it. I guess they were to busy ironing out the substantial start-up problems, such as the odor issue, you mentioned.

    You may have notice a subtle shift between those two breathless Discover articles. Instead of producing 500 bbl from 210 tons of waste (first article), they now need 290 tons (20 tons of it pure pig fat), or a 28% reduction in oil yield. Instead of claiming 2.4 bbl/ton of waste, it is now 1.7 bbl/ton (validating an estimate of the maximum yield of ~2.0 bbl/to). Funny thing is Appel and his team still use the 2.4 figure in their financial analysis, even when it would help their argument to use the 1.7 real number. From the second Discover article: “‘We thought we would get $24 a ton for taking the waste,’ says Appel. ‘Instead we are paying $30 a ton.’ That alone raises his production costs about $22 a barrel.” How did they get to $22? ($24/ton + $30/ton)/2.4 bbl/ton = $22.50/bbl. Using the real number would yield: ($24/ton + $30/ton)/1.7 bbl/ton = $32/bbl. Also getting less yield would raise production cost in a number of ways, including the fact that they may be buying natural gas for heating…

    So where does that leave TDP? No doubt it is not the silver bullet once claimed. None of the “anything” into oil that seduced Discover’s reporters. And costs are substantial. However, it seems like a good process for converting waste grease into liquid fuel. Much better than say biodiesel. Look at the feedstock (slide #6). How much cleaning (i.e. money and energy) would that stuff need to make it suitable as feedstock for a biodiesel plant? TDP uses sulfuric acid, whereas biodiesel uses methanol and a catalyst (usually NaOH). In terms of energy and money, I suspect TDP has the better input here. TDP yields a liquid fuel that is chemically almost identical to fossil diesel (without the sulfur and aromatics). TDP-40 can be blended with diesel in any ratio 1 to 100, without any issues. As Minnesota discovered last winter, biodiesel has some issues with cold weather. [Having worked in a Montana refinery, I can attest to the fact that winter properties for diesel are critical. I am aware that biodiesel has some problems with pour and cloud points in cold weather, limiting their usage to small blend fractions.]

    Slide 6 of “The CWT Thermal Conversion Process” Presentation

    The main threat to TDP, as I see it, is a process developed by Neste Oil, Finland, that I read about at GCC. Apparently this process allows an existing refinery to incorporate waste grease as a feedstock, without a radical change to the process (or a brand new SS plant). Even that process is not a slam-dunk, as I’ve seen reports of canceled projects.

    So yes, you nailed it: these guys overpromised and underdelivered big time. But in terms of the big picture I give them some credit: at least we are not talking about food -> fuel (as with most of the biodiesel plants being built in Europe, proving that the food -> fuel madness is not endemic to North America). [Oh, I agree completely. It is not the process that I took issue with; in fact I do applaud their initiative. My concern was the completely willingness of so many to accept this as the solution to our energy problems. I see the same thing happening right now with cellulosic ethanol.] They probably help to advance the debate on waste -> energy quite a bit. And they do have a working plant, which is more than we can say about Washington’s next big thing, aka cellulosic ethanol. [I will probably write the same article on cellulosic ethanol in just a few years – overpromised and underdelivered. I see many parallels here.]

    January 31, 2009 Posted by | biodiesel, Changing World Technologies, green diesel, reader submission, Thermal Depolymerization | 8 Comments

    Repost of TDP: What Went Wrong

    The is Part II of my look at Changing World Technologies’ thermal depolymerization process. This essay came from a reader, and was originally posted on April 12, 2007.

    But I also want to add some comments that regular reader “Optimist” added following the previous essay. First, those comments:

    The 85% efficiency claim is based on a faulty mass balance. The faulty mass balance is the basis for an equally faulty energy balance. You can verify by comparing production data (bbl oil/ton of waste) to the mass balance (still) presented by CWT.

    Contrary to what the breathless writers at Discover magazine believe, this technology is good only for recycling lipids (fats and oils) and the fat-soluble amino acids in protein. To understand why you need to follow the process flow diagram, which consists of three key steps:

    1. Thermal Depolymerization (aka Dilute Acid Hydrolysis – yes, the process uses sulfuric acid).
    2. Separation of water and fat/oil.
    3. Decarboxylation of fatty acids to yield hycrocarbon (diesel) product.

    Anything soluble in water goes into the effluent in step 2. That includes (but is not limited to) all carbohydrate and the bulk of the protein hydrolysis product (amino acids).

    CWT cleverly states that this makes the effluent a high quality fertilizer. Probably true. But that high quality fertilizer contains BTUs not available as fuel (the main product).

    Another comment from Optimist:

    To their credit, Discover magazine did raise another issue: product quality: Fuel quality was another challenge. Changing World Technologies‘ thick, tarry fuel resembles boiler-grade fuel oil. One prospective buyer insisted on what the company called “unacceptable pricing terms” for its relatively unproven product. In the end, CWT sold only 93,000 of the 391,000 gallons of fuel it produced and earned just 99 cents for each one. At the time, wholesale fuel oil distributors were raking in $2.50 to $3.30 per gallon. Even with the $1-per-gallon U.S. biofuels tax credit for every gallon sold, Changing World Technologies paid more for Butterball’s turkey offal than it earned back in revenue. (Accounting for all its operating costs, the company lost $5,003,000 in the first quarter of 2008, though operating at a loss is not uncommon or necessarily a very bad sign for a technology startup.) Emphasis added.

    Don’t worry – I’m sure next year they’ll be printing money…

    In light of this, I am not sure why they think it’s a good idea to do an IPO now.

    Now for the essay from a reader who provided some very specific details on what went wrong. He included a presentation in which he referred to several slides, and I will pull those out and post them so the references are clear. I will also insert some comments in the text [like this].

    —————————————

    Robert,

    I enjoy your blog quite a lot. Intelligent analysis is rare. Coupled with unbiased interpretation it is almost an unknown.

    Saw your discussion of TDP/TCP. Pretty much spot on. As a chemical engineer I thought you’d be interested in some deeper insights of how the process works. This is all information that used to be available on the web, but most of it has been removed.

    Start with the lecture (attached) by Terry Adams, CWT technical officer at MIT in April 2005 – best TDP technical article I know of [I have searched for an online version of this, but to no avail. Perhaps using the Wayback Machine one could locate an online archive of the original presentation]. The way I understand it, the process basically consists of two thermal treatment steps. The first step (slide #13) is a low temp/high pressure step that causes hydrolysis of all the biological material. A check of steam tables confirms that pressure is just high enough to maintain liquid water at the temperature given.

    Slide 13 of “The CWT Thermal Conversion Process” Presentation

    The first stage is followed by separation (slide #3).

    Slide 3 from “The CWT Thermal Conversion Process” Presentation

    As indicated in slide #14 they have a clever way of flashing off some of the water and then using the steam to heat the feedstock [This sort of heat recovery is standard practice in the petrochemical industry]. This is at the heart of their claims about high efficiency: the steam is condensed, so most of the water in the feedstock is discharged as liquid. Calling it distilled water, is of course salesmen talk that would make a used car salesman’s eye’s water.

    Slide 14 of “The CWT Thermal Conversion Process” Presentation

    But take a closer look: After separation only the “organic oil” goes to the second stage. After full hydrolysis (let’s just assume that for now) what monomers would be part of the organic oil? Fatty acids barely make it into this oil, due to the little known fact (see flow diagram on slide #11) that sulfuric acid is used to aid hydrolysis [If I had known that, I had forgotten about it. That does put quite a different spin on the whole process]. (DOE would call the first stage by another name: Dilute Acid Hydrolysis). Some fat-soluble amino acids. That’s it. (I bet you can figure out what cellulose fed to these two units would yield…) [It would interesting to see some yields on this. What I would really like to see is what they get if they threw corn in there. If their energy balances are really good – and even with all that has gone wrong they appear to be better than for corn ethanol – then I would like to see some experiments in that direction.]

    Slide 11 of “The CWT Thermal Conversion Process” Presentation

    Of course, CWT are master salesmen. The water-soluble amino acid and glycerol solution is not waste: it is a wonderful liquid fertilizer (slide #23). Talk about taking a lemon and making lemonade…

    Slide 23 of “The CWT Thermal Conversion Process” Presentation

    So, the “organic oil” goes to the second stage (high temperature/low pressure) where the fatty acids are decarboxylized (to yield oil) and some of the amino acids are deaminated and decarboxylized to yield who-knows-what (slide #15, point 2).

    Slide 15 of “The CWT Thermal Conversion Process” Presentation

    You raise the question of how on earth did CWT get their cost estimates so wrong. Well, a large factor in that would be overestimating yield (and per extension efficiency). CWT has long claimed that TDP has an energy efficiency of 85% (heading slide #12). Right there you smell a skunk. Now the dirty details.

    Slide 12 of “The CWT Thermal Conversion Process” Presentation

    The mass balance, slide #11 [posted earlier], shows that CWT probably did not take the CO2 that results from decarboxylation into account. This causes them to overestimate fuel production. You can easily do the calc’s I’m sure, but it is spelled out here. Apologies for the format, got mangled when they changed their format [That thread was a very good discussion on this issue; perhaps I will pull it out, reformat it, and post it at some point].

    The energy balance, slide #12, does not include the energy present in the “liquid fertilizer”. What, all that glycerol and amino acids contain no energy? The water vapor also presents energy lost, even if it’s not much.

    The mass and energy balances actually date from a previous publication (February and March 2004), also attached. One would expect that CWT would have discovered the error in the interceding year, and corrected it. I guess they were to busy ironing out the substantial start-up problems, such as the odor issue, you mentioned.

    You may have notice a subtle shift between those two breathless Discover articles. Instead of producing 500 bbl from 210 tons of waste (first article), they now need 290 tons (20 tons of it pure pig fat), or a 28% reduction in oil yield. Instead of claiming 2.4 bbl/ton of waste, it is now 1.7 bbl/ton (validating an estimate of the maximum yield of ~2.0 bbl/to). Funny thing is Appel and his team still use the 2.4 figure in their financial analysis, even when it would help their argument to use the 1.7 real number. From the second Discover article: “‘We thought we would get $24 a ton for taking the waste,’ says Appel. ‘Instead we are paying $30 a ton.’ That alone raises his production costs about $22 a barrel.” How did they get to $22? ($24/ton + $30/ton)/2.4 bbl/ton = $22.50/bbl. Using the real number would yield: ($24/ton + $30/ton)/1.7 bbl/ton = $32/bbl. Also getting less yield would raise production cost in a number of ways, including the fact that they may be buying natural gas for heating…

    So where does that leave TDP? No doubt it is not the silver bullet once claimed. None of the “anything” into oil that seduced Discover’s reporters. And costs are substantial. However, it seems like a good process for converting waste grease into liquid fuel. Much better than say biodiesel. Look at the feedstock (slide #6). How much cleaning (i.e. money and energy) would that stuff need to make it suitable as feedstock for a biodiesel plant? TDP uses sulfuric acid, whereas biodiesel uses methanol and a catalyst (usually NaOH). In terms of energy and money, I suspect TDP has the better input here. TDP yields a liquid fuel that is chemically almost identical to fossil diesel (without the sulfur and aromatics). TDP-40 can be blended with diesel in any ratio 1 to 100, without any issues. As Minnesota discovered last winter, biodiesel has some issues with cold weather. [Having worked in a Montana refinery, I can attest to the fact that winter properties for diesel are critical. I am aware that biodiesel has some problems with pour and cloud points in cold weather, limiting their usage to small blend fractions.]

    Slide 6 of “The CWT Thermal Conversion Process” Presentation

    The main threat to TDP, as I see it, is a process developed by Neste Oil, Finland, that I read about at GCC. Apparently this process allows an existing refinery to incorporate waste grease as a feedstock, without a radical change to the process (or a brand new SS plant). Even that process is not a slam-dunk, as I’ve seen reports of canceled projects.

    So yes, you nailed it: these guys overpromised and underdelivered big time. But in terms of the big picture I give them some credit: at least we are not talking about food -> fuel (as with most of the biodiesel plants being built in Europe, proving that the food -> fuel madness is not endemic to North America). [Oh, I agree completely. It is not the process that I took issue with; in fact I do applaud their initiative. My concern was the completely willingness of so many to accept this as the solution to our energy problems. I see the same thing happening right now with cellulosic ethanol.] They probably help to advance the debate on waste -> energy quite a bit. And they do have a working plant, which is more than we can say about Washington’s next big thing, aka cellulosic ethanol. [I will probably write the same article on cellulosic ethanol in just a few years – overpromised and underdelivered. I see many parallels here.]

    January 31, 2009 Posted by | biodiesel, Changing World Technologies, green diesel, reader submission, Thermal Depolymerization | 8 Comments