The Case for the Australian Coal-to-Liquids Industry
Posted by Gail the Actuary on September 30, 2010 - 9:22am
This is a guest post by David Archibald, of Perth Australia. He has a degree in geology from Queensland University, and has worked in a number of fields, including oil exploration. He also makes a hobby of studying climate change. (I have removed the climate change slides from this presentation, however.) This is a link to David's personal website.
Below the fold is a presentation he made regarding why he thinks Australia should consider coal to liquids technology. It can also be found on the website of the Australia Coal-to-Liquids Association, or directly, at this link.
David Archibald provides the following additional information about costs:
The cost of CTL is about $45 per bbl (opex and depreciation) at zero feedstock cost. That is based on the CCT process which saves on capital cost by not reforming the tail gas. The depreciation charge in that $45 is $14 per bbl. It could be $28 per bbl.
Assuming 2 bbls per tonne of coal, the coal cost component per bbl is half the cost of coal per tonne. So $40 per tonne coal would take it to $65 per bbl.
Note: The estimate of recoverable reserves for China used in Slide 28 is 1 trillion tonnes. According to this report on China's coal industry, China's recoverable reserves "exceed 1 trillion tonnes".
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Thanks, David!
I know that there will be readers who find the whole idea of even thinking about coal-to-liquids objectionable. Whether or not we personally object to it, there are no doubt others who will be considering the issue, perhaps in a different part of the world, so it seems like we should at least be aware of the issue.
It seems like there is a possibility of a larger range of error coal-to-liquids, since there have been few recent projects, taking into account modern environmental standards on things such SOx and NOx and mercury emissions. So it seems like costs are only quite approximate.
I didn't notice anything about water requirements. This may be a limiting factor in many places also, I would expect.
The Chinese have installed and planned capacity of 600,000 BOPD of CTL. Re SOx and NOx and so on, that is all cleaned up in the synthesis gas.
David, you've focused only on supply in this presentation, but have not even touched on demand. Hence, this is merely a BAU-extending proposal.
Australian vehicle fuel economy standards can be brought up to European standards, for example.
AUS has given a reduced import duty on 4WDs compared with passenger cars (after
all, they are commercial vehicles and only farmers or trades people would want one, right?).
Fortunately, this is scheduled to disappear this year.
AUS has also given tax breaks to people with a ‘company car’ according to how far they drive
it each year. Drive further, get a bigger tax deduction. In the UK they had a similar system
and found when they gave a flat rate based on fuel efficiency, people bought cars with better
fuel consumption and actually chose to drive less.
There are a number of recommendations that should be made to reduce demand first, instead of simply gutting environmental standards.
that is all cleaned up in the synthesis gas.
We would need more information than a simple handwave.
Other directions include going all nuclear and renewables, with a transition to electric transport (including rail), increased urban rail, buses, biking, telecommuting, and a number of other approaches that are working well in a number of European cities.
That's something you always see. What's a "progressive"'s answer to energy production problems are batteries, new windows, "saving".
Can you get a simple fact, true in nature, true in economics, and true everywhere through your head please ? It's an embarassingly old discovery, believing in "saving up" is only slightly better than believing in a flat earth and a vengeful god demanding stoning sacrifices.
It's called "Jevon's paradox".
Increases in efficiency lead to increases in total used fuel. Not decreases.
Additionally, equally trivial to see :
There is a (strong) tendency for new increases in efficiency to only be possible to develop if the total used energy used by society increases, because otherwise the energy needed to develop and test them represents a too great percentage of the total. Let's give the ultimate savings as an example : developing fusion requires maintaining the ability to generate the magnetic field needed by tokamaks. In electrical terms that means that any country that wishes to have a fusion plant needs to have multiple 5 GW (gigawatt) generation facilities ready at all times. This applies to less extreme cases too.
First, Jevon's Paradox is a proposition, not a fact.
Second, as mentioned countless times here at TOD, JP falls apart with a declining supply. Your assertion that efficiency can only be realized by a growing demand is simply that - an assertion.
That's something you always see. What's a "progressive"'s answer to energy production problems are batteries, new windows, "saving".
(sigh) I'm a moderate, but could just as easily throw partisan barbs and say that an ultra-conservative's answer to energy production is more oil wars, more oil spills, more GHG production, and more big cars/SUVs, because "The American Lifestyle is non-negotiable".
Two points:
First, Jevon's Paradox is nothing more than a special case of the Rebound Effect, which in turn is simply a special case of bog-standard supply and demand.
Improving fuel efficiency is an effective price decrease, which then leads to a demand increase; in some cases, that demand increase can be larger than the initial price decrease/efficiency increase. That's all Jevon was saying.
Second, you're absolutely right that it's not a fact or law. For example, Germany has reduced consumption of motor vehicle fuel since the mid-90s, despite (a) more German drivers, (b) each driving further. Fuel economy improved roughly 20% (Fig 1), but per capita miles driven only around 10% (Fig 2); note that a recent report from the Germand government confirms this, with a 5.6% decrease in motor vehicle fuel between 2000 and 2008, despite real per-capita GDP growth (in a manufacturing-heavy country) of 14% in the period.
Jevon's Paradox is not a law of nature, and in the real world it doesn't always happen.
Jevon's Paradox is not a law of nature, and in the real world it doesn't always happen.
And in mature industries or economies it almost never happens. It's a phenomenon of very early development, which is where coal was when Jevon was writing.
"the evidence does not suggest that improvements in energy efficiency routinely lead to economy-wide increases in energy consumption. At the same time the evidence suggests that economy-wide rebound effects will be at least 10% and often higher. Rebound effects therefore need to be factored into policy assessments.
• For household heating, household cooling and personal automotive transport in developed countries, the direct rebound effect is likely to be less than 30% and may
be closer to 10% for transport. Direct rebound effects for these energy services are
likely to decline in the future as demand saturates. Improvements in energy efficiency should therefore achieve 70% or more of the reduction in energy consumption projected using engineering principles. However, indirect effects mean that the economy-wide reduction in energy consumption will be less."
http://www.ukerc.ac.uk/Downloads/PDF/07/0710ReboundEffect/0710ReboundEff...
Thats and accounting charade so called mature economies have exported and enormous amount of manufacturing out to third world countries. Today you need to look at global aggregate demand which is following Jevons Paradox to a tee. And will continue to do so.
Next as far as what happens when the commons is shrinking I'd argue that this will simply result in growing percentage of the population unable to to access the commons. All that happens is the ranks of the poor grow. And this phenomena has also been occurring for some time. Per Capita incomes have been flat to declining in many parts of the world. As energy becomes more expensive these trends will accelerate.
Obviously the ranks of those in poverty can grow faster than supply falls at economic turning points. As long as housing prices rose housing was fine when the started to decline the economic impact was huge even though the relative price change was fairly small. In our economy the onset of deflation and contraction aka "negative" growth has a big impact initially but it decays fairly rapidly. Most of the money is lost at the turning point.
The critical factor which makes Jevons Paradox hold is this well or reserve of impoverished people who want to escape poverty. In his time coal consumption was growing working to reduce this reserve in our time energy is shrinking and the reserve is growing. However that does not matter its simply the existence of the well thats the problem and which generates the paradox.
And of course its obvious that until you address population nothing really works all that happens as the reserve of poor willing to do anything to be rich changes at the margin.
Thankyou, David! Since we rely on one depleting resource, obviously the only solution is to change to another depleting resource. This sort of solution is well-practiced by financially prudent people across the developed West, paying one credit card off with another.
Brilliant.
Looking at his website, we see that he's another climate change "sceptic". Specifically, warming is happening but it has nothing to do with carbon dioxide, it's the sun. No. His climate sceptic ideas are rather demolished here.
So if his ideas have no merit whatsoever, why would he express them? Perhaps because he makes a living exploring for oil in NW Australia. He also works with an astroturf group (described here) funded by BHP-Billiton, Western Mining, Monsanto, Phillip Morris and so on. And has been the director of several mineral and oil exploration companies.
In other words, a man who makes his living by finding stuff to dig up and burn, and represents a group funded by companies who make their living by finding stuff to dig up and burn, tells us that we should dig up more stuff and burn it, and no, it's harmless, honest.
No. We will not solve the problem of one depleting and polluting resource by switching to another depleting and polluting resource.
Time for my favorite quote!
"It is difficult to get a man to understand something when his salary depends on not understanding it." -- Upton Sinclair
But I wouldn't call his organization an astroturf group: it's more of a groupthink tank.
No. We will not solve the problem ... by switching to another depleting and polluting resource.
I think you mean "we should not". I have a feeling we will regardless.
He is right, even if he is wrong...
(I'm assuming that Coal to Liquid is viable at the price points he has stated, and it sounds about right).
As a transition option, for a country the size of Australia, it would work.
Hopefully it will be done with at least an understanding of why we are no longer able to get oil out of the ground.
The real reasons to not do CTL are:
1. Greenhouse gas emissions.
2. Denial of the problem. Coal supplies are infinte too, right?
But if we actually started to address these problems then using CTL would markedly reduce the pain that Australia would have to go through.
Not sure it would be so good if every country started doing it....
Michael
For a country the size of Australia, population wise, continued greenhouse gas emissions at current transportation fuel levels would be a very small percentage of world greenhouse gas emissions. They are too small to matter.
Then every little population unit (State, Province, town, etc) could say they are too small to matter. We all matter in the big picture.
http://en.wikipedia.org/wiki/List_of_countries_by_carbon_dioxide_emissions
Unless you have agreement among the big 4, (and possibly the main EU members) it is pointless for Australia to do anything.
States, provinces, cities are not sovereign nations.
The four countries you list produce roughly half of emissions. Other countries produce the other half. Both halves are equally important, and country is to some degree an arbitrary unit.
The 15 countries that are bigger greenhouse gas emitters produce 74.44% of greenhouse gas emissions.
Actually, if you include the EU as a whole instead of constituent countries, then over 80% of greenhouse gas emmisions are produced by bigger emitter than Australia.
Countries are not arbitrary units. Sovereign nations are the decision makers that can agree to be bound by treaty to specific levels of emissions. The only fuzziness is whether the EU bargains as a unit or as individual countries.
Nevertheless, what Austrailia does is just rounding error in the committments of big countries.
Merrill, I like to look at it on a per capita basis (hope the table looks OK):
rank country CO2/per person
1 China___________ 4.9
2 United States___ 18.8
3 India___________ 1.4
4 Russia__________ 10.8
16 Australia_______ 17.1
What source do you use?
Sorry about the formatting, I just did a cut and paste from recent assignment. Denmark figures are not relevant but Australian figures are.
Indicators
million
million
billion
per Capita
toe
toe
toe
electricity cons per capita kWh
kWh
kWh
kWh
/ TPES
/ Capita
Note 1:
http://www.iea.org/stats/indicators.asp?COUNTRY_CODE=DK
Note 2: http://www.iea.org/stats/indicators.asp?COUNTRY_CODE=AU
Note 3: http://www.iea.org/stats/indicators.asp?COUNTRY_CODE=29
Does the figure for Australia include all the exported coal? They may not be using it directly, but they are aiding and abetting its use in other countries, especially China. California is a state, for example, but is considered important enough that the oil companies have sponsored an initiative to kill its law to cut greenhouse emissions.
And what are you "aiding and abetting"? The demise of our financial future by preventing development of alternative fuels in the face of rapidly declining conventional light oil?
While the thrust of this comment is true. The detail show a lack of understanding of who produces, consumes and exports what.
Australia has exported very little coal to China. Test shipments in the tens of thousands of tonnes until the two years or so. The biggest amount in one years had been 3 million tonnes (<1% of Australia's production and about 0.125% of China's production). Historically both China and India have tried to be self sufficient in coal. Remember they are both in coals "Big 5".
It's only in the last two years that China has been actively securing commoditiy of all types outside it borders. In the coal arena, it seems to be trying to secure 'in-ground' coal reserves in another "Big 5" member, Russia and in emerging producer, Indonesia. China have struck deals in Australia, so expect FUTURE exports to China to be in the tens of millions of tonnes/annum, if the deals are followed through.
To give an idea of scale, Chinese coal production is about twice that of the US and six times that of Australia. Until the last couple of years, China had been a net coal exporter, but it only amounted to a few percent of total production (not seen recent Chinese export figures). Mainly in client state goods for goods deals, I understand.
That's what the US says, relative to China.
Australia has one of the highest life expectancies by world standards as well and yet we spend many billions of dollars each year trying to cure cancer? Climate change is environemtnal cancer, and while we may pat ourselves on the back for living a generally healthy lifestyle, we are going to be the hardest hit of the developed nations, simply by an accident of our geography.
The key issue for Australia is not how much GHG we produce ourselves, but how can we contribute meaningfully to the world solutions. Australia will be one of the worst hit developed countries if climate change accelerates in the genreal trend it is showing so we should be highly motivated to lead the world wide response. Unfortunately, TPTB are a buch of myopic, self interested superannuants, who put their own financial interests above those of future generations and use excuses like "Australia can't make a difference" to continue feathering their own nests, knowing they'll be safely dead in graves, long before the worst of the predictions could happen.
I'd say he should go back to school, but I don't think it would do any good. The whole idea of taking the carbon cost into consideration, a when not if, seems to have passed him by. Lignite FFS, how dirty can you get.
Not only that, but zeroing all imports would require 18 of his very big CTL plants, at a capital cost of $57bn, and that's without the cost of running them .... to produce oil at $300 per barrel - which is higher than an economy can run at. And that's with his rosy figures.
That's as opposed to efficiency measures and public transport which in the urban and suburban environment of Australia could cut usage extremely well.
There are reasons CTL is seen as a margin only extravagance - they seem to have passed Mr Archibald by.
I'd like to suggest that those of us who disagree with Archibald's assessment of climate change still consider what he has to say here: not as a message of hope, but as a warning.
There are two ways in which anthropogenic CO2 can be limited:
1) We choose to limit our use of fossil fuels
2) Increasing scarcity causes fossil fuels become too expensive to base our society on
I personally have my doubts that we'll be able to achieve option 1): too many greedy mouths sitting around the buffet: there will be no leftovers. I feel that CO2 levels will probably be limited by option 2).
But the point of this article is that coal-to-liquids projects are viable, cost-effective ways to produce vehicle fuel. Archibald doesn't intend it as such, but for us it's a warning: Option 2) above is unlikely. As oil grows scarce, we'll switch to coal and keep on burning.
If you'd like to do a truly terrifying calculation, work out the atmospheric CO2 concentration after all currently-known viable coal reserves are burned. Archibald's study is useful because it suggests that's not an unlikely scenario.
Or to put it another way: you may find coal-to-liquids technology personally repugnant, but if it's profitable and not prohibited, it *will* happen. So you'd best pay attention to its economics.
The costs seem in line with the CTL association's assertion
Leaving the climate change problem aside for the moment, I'm not convinced that the economics work out simply because of the enormous capital that is required for them in aggregate. I think only a few of these plants will get built before the world financial system struggles to provide capital for these sorts of projects. That's a good thing from the climate change perspective but it does seem to indicate that Australia (and the rest of us) are in a box. The obvious rejoinder would be that perhaps Australia could fund the projects from domestic funding sources but that seems a stretch.
So the next part of the analysis would be to determine where the funding would come from for the $57B someone else mentioned is required to replace all imports.
When looking at the whole picture, it really seems to me that Australia will experience what everyone else will experience: massive economic contraction. Initial estimates of the rate the world economy would contract as oil declines come in at roughly a 1 to 1 ratio (see Hirsch's paper "Mitigation of maximum world oil production: Shortage scenarios" at ScienceDirect). His conclusion is:
For more see my post Estimating the Economic Impacts of Peak Oil. Personally I think unity (i.e. 1 to 1 contraction) is the best case scenario. Cascading debt defaults will likely make it closer to 5 to 1. Of course a systemic financial failure brings it closer to 50 to 1 or thereabouts.
I will soon update that post with the latest work from Ayers and Warr "Evidence of causality between the quantity and quality of energy consumption and economic growth" also available at ScienceDirect plus the work of Dean Fantazzini after he publishes some interesting work that demonstrates the link between energy and the world economy.
So, let's not kid anyone here: the requisite number of CTL plants will not be built in Australia even if its citizenry understood the problem in time (which, if they are like the rest of the world, they don't) and the political will and financial resources could be mustered to build them.
Ergo, prepare for contraction.
aangel,
I wonder how firm the cost/time scale FAQ answer is. Do you (or anyone else here) have information about smaller scale plants? Have any been built to verify design assumptions? At what size? I'm sure there should be some economies of scale, but has there been any work on pilot plants?
Sorry, geek7, I don't have that information. You could call up the association and see what they say. Normally the people who work at these places are quite helpful and you would return with some good information to share with all of us.
It is best to avoid sweeping global presumptions, as countries will have widely differing finite affordable fuel tail managements.
If you want some REAL examples, of Coal to Fuels, look to South Africa.
http://english.peopledaily.com.cn/90001/90777/90855/7152354.html
South African petrochemical giant Sasol has set a world record after flying the world's maiden commercial passenger flight powered solely by the company's 100 percent synthetic jet fuel, which is made by converting coal into liquid fuel.
that already have mature displacement program:
For the past 10 years, 50 percent of the aircraft departing from Africa's busiest airport, Johannesburg's OR Tambo International Airport, use Sasol's 50 percent synthetic jet fuel.
Initial estimates of the rate the world economy would contract as oil declines come in at roughly a 1 to 1 ratio (see Hirsch's paper "Mitigation of maximum world oil production: Shortage scenarios"
This suggests that oil consumption is related to GDP in a 1:1 ratio - in other words, if oil consumption drops by 10%, GDP will as well. Here is what he said recently: "So then if one calculates a range of 2 to 5 percent, some people think the number may be larger, 2 to 5 percent per year increase in oil shortage, one comes up with a rather disastrous indication world GDP will decline by 2 to 5 percent a year in tandem with increasing oil shortages."
Is this realistic?
No. We can see this from economic history: in the US, oil consumption fell by 19% from 1978 to 1983, and yet GDP grew slightly. Similarly, world oil consumption has been flat for the last several years, but GDP growth was strong thourgh 2008 ( stronger than for the US (which itself grew 8% in the last 3 years up to that, with flat oil consumption), and has resumed growing.
Hirsch seems to have looked at the relationship between oil and GDP over the last 20 years, noticed that the ratio of oil increase to GDP increase has dropped from the previous 1:1 to roughly 1:2.5 (an analysis which he attributes to the DeutcheBank, but which can be derived straightforwardly from IEA statistics). In other words, in previous decades as the economy grew, oil consumption grew as quickly, while lately less oil has been needed. Hirsch drew the very strange inference that GDP has become more dependent on oil, rather than less.
An important and relevant researcher here is Robert Ayers . We see that he showed that GDP is related to applied energy (exergy), and only very loosely linked to primary energy consumption, let alone to oil consumption. The research indicates that BTU's only explain 14% of GDP,and that the source of those BTU's can change (coal to oil to wind, for instance). Both energy efficiency and energy intensity can change. Further, oil is only one source of BTU's. Oddly enough, many energy commentators seem to misunderstand Ayre's research, and think that it supports the idea of a strong causal connection between oil consumption and GDP.
US (and world) GDP could grow much more quickly than it's energy consumption (even including electricity). The best example of this is California, which has kept per capita electricity consumption flat over the last 25 years, while growing it's GDP relatively quickly.
Ayres used "exergy services", which are not "very close to BTU parity". Exergy services are work performed. So, for instance, a Prius performs the same work as a similar vehicle with half the MPG, but uses half the BTU's. Strictly speaking, a Prius can perform the same work as a Hummer (transporting people), and use 20% of the BTU's. An EV also does the same work as a Hummer, and uses about 1/3 of the BTU's as the Prius, and 1/15 of the Hummer's...and so on.
I agree that Ayre's work is important but it is consistently you who misunderstands what he and Warr are saying as well as the bigger picture as you fruitlessly try to demonstrate the notion that the world economy does not need energy to grow. From Ayres and Warr's latest paper Evidence of causality between the quantity and quality of energy consumption and economic growth:
Emphasis added.
In the abstract, he also notes:
In the conclusions of the paper, they go further:
Emphasis added.
Yes, it is possible for a while to find a country that grows its economy without energy usage increasing. This can happen as credit expands particularly the service sector while manufacturing moves outside the country. But the world as a whole does need energy for the economy to grow.
The Granger causality and cointegration tests Ayres performed in his latest paper demonstrate that. Plus Deanfa has done some innovative work that we will be publishing in a paper together next year.
Ayres and Warr are still missing some of the big picture even though they acknowledge peak oil in the paper because they fixate on efficiency:
Sure, make more net energy available and more growth is possible. But what happens when both gross and net energy availability declines? They don't go there.
I've heard of some quixotic quests, but yours, the goal of demonstrating that the economy doesn't need energy to grow, is definitely high on the list!
you fruitlessly try to demonstrate the notion that the world economy does not need energy to grow.
That's not what I've been saying. I'v been trying to tell you that the world economy doesn't need growth in oil consumption in order to have economic growth.
An increase in exergy supplied has both a short-run and long-run effect to increase output.
Note that he says "exergy". That's very different from "energy".
output growth is ‘driven’ by increased availability of energy and increased delivery of useful work to the economy.
Note the use of "useful work". Then note what I said above: "We see that he showed that GDP is related to applied energy (exergy), and only very loosely linked to primary energy consumption, let alone to oil consumption. "
See the difference? Ayres is showing that economic growth is related to "useful work", not primary energy or oil. We can see growth in "useful work", without seeing growth in primary energy, and certainly without growth in oil.
Yes, it is possible for a while to find a country that grows its economy without energy usage increasing. This can happen as credit expands particularly the service sector while manufacturing moves outside the country.
Look at the US from 1979 to 2009: it's GDP grew by 150%, and it's manufacturing grew by 50%, while oil consumption was flat.
I've heard of some quixotic quests, but yours, the goal of demonstrating that the economy doesn't need energy to grow, is definitely high on the list!
First, we can see quite clearly that it doesn't need oil to grow. 2nd, we can see that it doesn't need fossil fuels to grow. 3rd, we can see that it doesn't even need energy in general to grow, if it increases energy efficiency. He says so in his abstract: "We infer that output growth does not drive increased energy consumption and to sustain long-term growth it is necessary to either increase energy supplies or increase the efficiency of energy usage. "
Ayres is talking about "useful work". He's saying that we can use 50MPG Priuses, and transport 5 times as many people, for the same energy as is used by one car that gets 10MPG. And, we can use 12 EVs, and and transport 12 times as many people, for the same energy as is used by one car that gets 10MPG.
Do you see the difference?
There is no difference, Nick.
Oil comprises about 1/3 of the world's primary energy supply so when oil production declines the world's primary energy supply will decline, ergo the world economy will shrink.
It's the same thing as saying take one third of the supergiant oil fields out of production. Will world oil production decrease? Of course it will.
But the 1/3 ratio doesn't really capture the outsized role oil has in the world economy since it's primarily used for transportation and infrastructure construction and maintenance heavily depend on it. Impacting the cost of moving resources and goods and people to their jobs and all that has a disproportionate impact on the economy. Though oil makes up only 1/3 of the primary energy supply, its impact is more as though it were 2/3 or higher.
On this score, Dick Cheney got it exactly right about oil (emphasis added):
It's the same reason we have Oil Shock Simulations — precisely because of the role oil has in the world economy.
You seem to be one of the few people in the world who can't see this. Other people aren't having so much difficulty seeing the connection and regard the decline of oil with due seriousness:
Outcome Grim at Oil War Game
Former Officials Fail to Prevent Recession in Mock Energy Crisis
http://www.washingtonpost.com/wp-dyn/content/article/2005/06/23/AR200506...
Military Study Warns of a Potentially Drastic Oil Crisis
http://www.spiegel.de/international/germany/0,1518,715138,00.html
Oil comprises about 1/3 of the world's primary energy supply so when oil production declines the world's primary energy supply will decline
Maybe. Or other energy sources will grow faster.
ergo the world economy will shrink.
Are we agreed that's not what Ayres is saying?
Dick Cheney
You're going to quote Cheney? Really? Someone who's built a career on crony capitalism, and who is defending the interests of.....Haliburton??
I would agree that oil is a very important military asset, and an important competitive asset, especially in the short term. This is very different from whether it's necessary in the long run, especially from the point of view of the whole world.
It's the same reason we have Oil Shock Simulations
Oil shocks are important, but they're also temporary. Of course a sufficiently large oil shock can cause a recession, but recessions are temporary.
The German study wasn't an independent study, it was a literature search of oil-related risks. This was a preliminary, internal draft document. There's a reason it wasn't officially released.
Really? That's an astonishing statement and, in my view, demonstrates how poor your grasp is of the world energy and world financial systems.
I know, I know, we'll magically ramp up all the other sources "because we need to" while simultaneously replacing all the equipment that depends on oil to use these other energy sources.
Andre, and Nick,
Although you guys have genuine disagreements, you're also doing a lot of talking past each other in this particular thread, in my opinion. Even more than usual between you two.
Surely you can both agree that if oil declines, and no other energy sources "grows fast enough", then total primary energy will decline, and if those other sources do "grow fast enough", then primary energy would not decline. Your disagreements are about the possibilities for "fast enough."
Although I'm not familiar with Ayres work, from what both of you so far have shared regarding it, it does not seem to me that his work is by itself aimed at answering the question of whether alternative energy can "grow fast enough." It seems like it is more theoretical than that, aimed at answering what would happen in either scenario rather than predicting which will happen. You both seem to be reading him the same way and drawing different conclusions by adding other personal assumptions you are making about the future of energy supplies. You guys might as well stop using him in your arguments, I think.
JaggedBen,
You've almost got the problem we're discussing. The reason we are using Ayers and Warr's work is because Nick asserts that it is "unproven" that the world economy will contract as oil declines. Ayers' work directly addresses that because he connects our energy supply with world GDP.
I extend the connection by asserting that oil is a critical component of the world primary energy supply and thus when it declines the world economy will contract, thusly:
IF the size of the world economy depends on energy used
AND oil is a prime component of the global energy system
THEN as oil declines the world economy will contract.
This is important because preparing for a contracting world is very, very different from what Nick would have us do, which is basically ignore that little problem and rest all our plans on electric vehicles powered by wind. That's a simplification of his plan, but not by much.
You're right that Ayres does not address whether alternatives can ramp up in time. We can't even get to that place because to Nick the world economy won't contract as oil declines. He cherry picks moments in time to make the astonishing claim that as world oil production declines the economy will remain the same size and possibly even grow.
That's a fundamental misunderstanding of some fairly basic relationships, in my view, and it's no wonder we get nowhere in these exchanges.
Personally, I think there is a good chance that he is in the bargaining stage. When people bargain they assemble evidence that allows them to avoid confronting some particular outcome. They reason and make seemingly cogent arguments but their assumptions are marked by a pronounced optimism and they routinely give low probability outcomes a much higher chance of occurring than people not in the bargaining stage. Nick makes these sorts of overly optimistic assumptions all the time. Go back and review his projections for electric vehicle growth: they are significantly higher than any study we discussed. This sort of thinking is usually a very good indicator of bargaining.
In any case, I'm not in Nick's head so I could never say for sure. A trained psychologist might be able to tell but I think even then the only sure way of knowing is if he himself at some point in future says, "You know all those discussions we had? I can see now that I just didn't want to confront the gravity of the situation. I was spinning my wheels looking for any way to believe things wouldn't change."
In my experience studying this phenomenon, he won't even know if he's bargaining until that future point in time. The mind is a tricky thing. If it really is bargaining that is going on, our conversations are pointless because the bargainer can find an infinite number of reasons to avoid confronting the outcome. It does, hopefully, provide a service to others who are listening in, though.
Now, it's equally likely that he just hasn't made all the connections yet, which is where most people in the world are because the general level of energy education is quite low.
So I would never say with any certainty that Nick is bargaining. Only he will know and he may never share that insight with us here. (The other psychological factor to consider is that once we stake out a position we feel we have to defend it publicly even if we've actually changed our minds. That's a whole other issue.)
It's also possible that I'm completely wrong and I am seeing a connection that isn't there and that the world economy will not contract as oil declines, as I demonstrate in the slide below. Naturally, I think Nick hasn't connected the dots and he thinks I've connected dots that don't exist.
We are all going to encounter a lot of people in the bargaining stage so it's worth knowing something about it. Logic doesn't work — at all. That's why I went into some depth on the topic even if it doesn't apply to Nick.
In any system, if you can match the interface, then the system downstream of the interface won’t know the difference.
The main tenet of the post under discussion is that nuclear power creates the synthetic oil. Nuclear power is where the energy comes from.
If enough nuclear oil is manufactured, all will be well.
Yes, of course if enough of any or all the alternatives could be ramped up, then all will be well...except for all the other environmental problems we face that are right behind oil depletion (climate change, depleting aquifers, depleting metal and phosphorus ores, dramatic loss of biodiversity, fishery exhaustion, ocean acidification, etc.).
The only way you can say "all will be well" is if you ignore just about every other indicator that our ecosystems are deteriorating.
No, all will not be well. That's more wishful thinking or simple ignorance of the actual condition of the planet and our presence on it.
Andre,
Let me point out that I never say that "all will be well". In fact, I think climate change is an enormous problem, and I don't see any evidence that humanity is addressing it quickly enough. I think species extinction is also very important, and not being addressed adequately.
I do think it's important to clarify that we have technical solutions for both PO and AGW, and that those solutions are likely to be implemented quickly enough to make the transition from oil only medium painful (pain is, of course, relative).
Acknowledged.
Clearly Nick isn't disputing Ayers' connection of energy supply with world GDP. He's simply disputes the that oil will necessary decline faster than other sources can replace it. It's an argument about possible rates and timing, not about Ayers central conclusion.
Therein lies the problem with trying to use Ayers to convince Nick that alternatives can't ramp up in time, which is what you are trying to convince him of (or at least it's your major point of disagreement with him).
For the record, I'm on your side here, for the most part. It's fairly clear to me, if not to Nick, that over the next few decades decline in oil production is not going to be matched by growth from other sources, and that's going to mean economic contraction. However, I'm somewhat agnostic as to how significant growth from other sources will be. If they are significant enough, then economic contraction might not simply follow a line determined by declines in oil production. At some point, growth in alternatives may become more significant to the economy than decline of oil, in which case, according to Ayers, we would presumably see an economic turnaround. On the other hand, alternatives could be too weak to do much of anything, and there might be a threshold for their growth below which they would not survive in a contracting economy.
I like your slide (the title is exactly the pertinent question, in my opinion) but I think it's either a little mis-labled, or needs a little more explanation. As I would read it, the blue line wouldn't represent World GDP, but rather "GDP fueled by oil", or something like that. 'A' and 'B' represent possible curves for "GDP fueled by renewable energy". World GDP would be the sum of the two, and, remarkably since this slide comes from you, would be fairly flat (like Nick posits?) in the 'A' case.
jb,
Nick definitely is disputing the notion that when energy in general and oil in particular declines the economy will contract. He has been disputing this throughout the long-running conversation we have been having together. He points out that certain economies during certain periods have experienced growth even while their overall energy — and oil — usage have gone down. He then mistakenly applies that to the whole planet rather than recognizing it for what it is — a unique set of circumstances that cannot be extended to the planet as a whole.
He re-asserted a variant of that above when he made reference to California. He fundamentally disputes the connection between energy and the economy:
http://europe.theoildrum.com/node/6720#comment-685445
Somehow for Nick even with "declining energy in general and oil in particular" it's "highly unrealistic" that the world economy will contract.
I know, pretty odd, but that's his view.
Except it doesn't say that. Its been pointed out to Nick several times that it doesn't say that. Stoneleigh herself pointed that out to him.
The fact he continues to make that claim leads me to believe he's unreachable for whatever reason, or just playing some sort of stupid game with us.
If you could point out that conversation, I would appreciate it. I missed it the first time around.
In any case, I always thought that Nick was also saying that we could follow the blue line below in which so-called clean technologies come to the rescue. We can continue living our profligate ways with just the smallest decline in living standards before all those technologies rush to the rescue like a solar panel calvary.
In any case, I am definitely saying that as the primary energy supply decreases the economy will contract and was under the impression that Nicole thought the same thing. Thus peak oil == peak energy == peak economy, based on the connection between the economy and primary energy as distinguished by Ayers and Warr (and how large and important a component of the primary energy supply is comprised of oil).
Thus, the only thing in our control at this point is the slope of the green line. Basically, can we keep away from the orange line? If so, by how much?
Greer points out that the idea that we have any significant control over the slope of the line could be no more than an illusion — a view that definitely has some merit. I do think we have some control, though, and am working to influence that.
Sure, it starts here and goes on for some length.
http://www.theoildrum.com/node/6976#comment-723860
The salient quote by Stoneleigh is
I added the emphasis.
Ah, I did read that. I think Nicole's assessment of Nick's understanding is correct: he is missing very big pieces in his understanding of the financial system.
I would only slightly change what Nicole says. At this point in time, she is correct that the financial bubble is popping all on its own so energy is not the key driver, though I think it will accelerate the process for sure and definitely had a role to play in initiating the pop.
However, once this financial regime is gone and we've replaced our current set of currencies with whatever comes next, probably in the next decade or at most two, financial effects will play a lesser role and the economy will be tied more closely to how much net energy is available to it.
At that point as energy declines the economy will contract at nearly a 1 to 1 ratio. Until then, it will contract at a 5 to 1 ratio (or greater) because of all the debt defaults we will experience.
I'm pretty sure Nicole would be ok with distinguishing between these two time periods as I have done and would agree that, in the second period, energy and the size of the economy are highly and directly correlated. Until we enter that period, she is correct in asserting that ponzi dynamics rule the day with a good dollop of energy shocks to hurry things along. Still I don't want to speak for her but I think the logic is sound.
I want to careful no to put words in Stoneleigh's mouth.
But my interpretation of what she wrote is that the short time economic crisis will set us up for a medium/long term energy problem. But that problem isn't energy driven as much as it's capital driven. Ie it's the lack of capital/investment that's going to leave a lot of what used to be available energy in the ground.
I sort of envision a USSR/Russia type scenario. Russia had tons and tons of oil left in the ground but couldn't exploit it do to their economic crisis.
I think Nicole's assessment of Nick's understanding is correct: he is missing very big pieces in his understanding of the financial system.
Yes, I disagree with her assessments.
I've read quite a bit of it. I still can't see the basis, the fundamentals. Is she an Austrian? I can't tell. As best I can tell, she relies on two ideas: 1) deleveraging will cause massive deflation, and 2) diminishing investment in oil production, will accelerate Peak Oil, and declinging oil btu's won't allow a growing economy, and 2). If I'm missing something, please tell me. This writing contains many general assertions and predictions, but no supporting analysis, detail or supporting evidence.
She uses the phrase "excess claims on underlying real wealth". This implies a ratio of claims:wealth.
Are there too many claims? How do we know? In other words, what's the standard of "too many"? Elsewhere I've seen historical charts of credit as a ratio to GDP, and pyramids of different kinds of debt. But, this seems to be a kind of handwaving argument: "boy, that looks big!". What's the objective standard that says this is too high?
Or, is underlying wealth too small? As best I can tell she's saying that we're finding out that underlying wealth is too small (or won't grow as expected) due to energy limits, therefore there are too many claims.
Her theories don't seem to allow good predictions. Here's a prediction from November 2008: "We appear to be beginning a market rally at the moment, which should lead to precisely this set of trend reversals. Such a rally is only temporary relief however. It may last for a couple of months, but then the decline should resume with a vengeance." http://theautomaticearth.blogspot.com/2008/11/debt-rattle-november-29-20... . That was 22 months ago...
This is what I mean by re-interpreting her work to fit your narrow narrative.
She doesn't just postulate a hard oil ceiling. She postulates a hard energy ceiling. That includes all your wind, coal, nukes etc.
She's said it again and again, in many of her articles and lectures. That you continue to misrepresent what she says implies there is either something very wrong with your thought processes or you are playing a very strange game with everyone here.
She doesn't just postulate a hard oil ceiling. She postulates a hard energy ceiling. That includes all your wind, coal, nukes etc.
Oh, well, I'm, pefectly willing to admit that I probably missed that.
Perhaps it's because it makes very little sense: the world has an enormous amount of stuff that is burnable for electrical generation, and the US has an oversupply of generation. So, I was giving her the benefit of the doubt by assuming she was focusing on PO.
Words fail me.
You are either an ass or an idiot. Maybe both.
Yes, words fail you.
And, yes, we sharply disagree.
@Rethin
I think I would speak for many by saying that Nick should be ignored in this forum as he is basically a competitive sociopath whose main reason for being here is to feed his compulsion to win arguments. He lacks any emotional intelligence and does not understand when to drop a pointless argument, insisting on the last word even when it adds nothing but irritation to the conversation. This is a pity because he obviously has some knowledge on energy issues but confuses his own interpretation with holy gospel, taking a fundamentalist approach he feels compelled to constantly defend rather than re-examine. The only way to treat Nick is not engage in his childish arguments and choose more civil interlocutors who can at least acknowledge both the costs and benefits involved in any hypothesis.
I would bet money that Nick will not be able to refrain from interjecting here, but I won't be responding to him.
main reason for being here is to feed his compulsion to win arguments.
So you don't think TOD has any importance? You don't think anyone reads if to inform themselves, and make decisions? It's just an academic place, where we amuse ourselves conversationally? It's not important to figure out what makes sense?
insisting on the last word
I like to discuss things until we get to agreement, or as close as possible. I often acknowledge agreement with people. It's what I'm trying for.
a fundamentalist approach he feels compelled to constantly defend rather than re-examine.
Read the comments from those who disagree with me most sharply and persistently. Do you see indications they are re-examining their argument? Acknowledging mistakes, and learning from them? Both sides have to do that, for a discussion to make progress.
I won't be responding
I almost always encourage people who disagree with me to keep on responding until we reach agreement. But, given that your comment was entirely ad hominem, I won't this time.
As best I can tell, Nicole sees energy as a medium-term problem, not a short term problem (5 year window).
You insist on misinterpreting what she writes to fit your own narrative.
See my response above.
Huh??
How does what I said above conflict with what you wrote? Actually, if you read later in that older post where I debated with Nicole, you'd see I finetuned what I said.
Re: the graph, it's more two distinct measures plotted on the same graph. My goal is to show that the world economy will contract as fossil fuels decline until it reaches the energy level provided by alternatives. It's simplistic because it doesn't include nuclear etc. but it is meant to convey a concept, not to be representative of actual numbers.
It could also be expressed in the way you say...let me mull over which would get the idea across better.
Edit: I just realized you said that in this new graph the world economy line would stay flat...I wouldn't show that case. I see no possibility of the world economy staying anywhere near its current size. It will either contract a tremendous amount before renewables provide a backstop or it will contract a tremendous amount x2 before renewables can prop it up.
Andre, regarding the visual connotations of the graph, it seems to me that 'A' and 'B' correspond, respectively, to 'Cleantech stability' and 'Creative Descent' from your other graph. (Mad Max would be a flat line labeled 'C'.) I completely agree that the A curve, 'Cleantech stability' is highly unlikely. (Maybe I'd give it a 5% probability.) On the other hand, I do believe that cleantech has a role to play in "Creative Descent.' In a nutshell, I believe that 'B' is achievable if we put our minds to it.
Granting that your graph is conceptual rather than actually quantified, I think that to get across these two possibilities subjectively, I would make your current 'B' line the better case, and make the worse case a line halfway below it.
One thing that drives alternatives, is pain. So, the more economic pain, the more motivation to fund alternatives.
As the pain ramps, we could see things like rationing.
Also note that "economic contraction", is very selective.
In the last fuel price spike (before the recession), there was a lot MORE "economic migration", as large wealth transfers took place.
There is already signs of significant moves to Gas, which has a longer half-life than Oil, and even coal is on the radar, as the half life there is longer still. (this thread)
Good point, certainly a slide that shows GDP accelerating down to Zero, is not very well considered.
As the GDP Sum is only somewhat Oil dependent (given plenty of examples where GDP grew, as Oil declined), then perhaps the Graph needs MULTIPLE GDP contributors :
Smarter examples could be Oil+Gas+Coal+Renewable+Thrift+Elasticity+Discretionary.
Each of these would have a value, and a Change Weighting factor
Each one of those can change, independently, and a new total GDP results.
Some countries may even grow during the tail transition.
Clearly Nick isn't disputing Ayers' connection of energy supply with world GDP. He's simply disputes the that oil will necessary decline faster than other sources can replace it
My position is rather different. I think we have a liquid fuels problem, and a climate change problem.
We have plenty of coal, nat gas, wind, solar, etc to produce all the electricity we need. But, we're going to have a liquid fuel supply problem, which will have to be addressed by somewhat painful conservation if efficiency and substitutes don't ramp up quickly enough.
We have a climate change problem, that we need to ramp up wind, nuclear, solar, etc to deal with. We probably won't do that quickly enough, but we will do it quickly enough to extend FF supplies sufficiently that electrical supplies will never be fundamentally a problem.
To me, it still sounds like you believe "that oil will [not likely] decline faster than other sources can replace it." I'm not sure how your position is "rather different", except that perhaps you prefer not to frame the issue as one of economic growth or contraction.
To me, it still sounds like you believe "that oil will [not likely] decline faster than other sources can replace it."
Well, we have so much surplus energy of all sorts that conservation will play a large role: more important uses of oil will out-bid less important uses, like personal transportation.
So, other sources won't replace oil as quickly as it declines in the short-term, but it won't matter nearly as much as some are suggesting.
I don't think Nick's view is so different or that wildly cornucopian
basically he is saying we can muddle through despite fossil fuel depletion.. much the same as majoran really is also portrayed as outside the box..
everybody is getting into a bunch over not a lot....
I tend to think that is what will happen.. how much carnage does muddling entail?
the area I struggle with is "muddle through to where"
9 billion people with a annual global GDP growth rate of 4% in 2050.. BAU
I doubt that very much.. I just don't think its doable or even desirable
I think we have the resources to manage the problem but not the political will or psychological adaptation to settle for something sane as a goal. YET
I am not up for giga death scenarios.... we all muddle through together the best we can and we ration whats in the tank until some sustainable infrastructure is in place(one way or the other via the market or command economy I have no intrinsic bias as long as it is "just" as possible)
what comes next? .. there is a real failure by
politiciansthinkers everywhere to present the population with some sense of the futureThere are billions of lives at stake here
Contracting to zero?
50% of world energy goes to electricity which is not dependent on oil. Coal moved in trains wouldn't take a lot of oil(all trains probably use less than 1 quad of energy).
The amount of energy required to get produce and transport a ton of food is probably less than 50 GJ per ton. 11% of that would go to transportation/oil.
http://www.leopold.iastate.edu/pubs/staff/ppp/food_mil.pdf
The average (fat) american consumes 1.1 tons of food per year.
Therefore, 1.1 x 50 GJ? x 300E6/E18=~16.5 quads?.
Then food transport would be 1.8 quads of liquid fuels(11% of food).
BTW, the US produces 12.8 billion gallons of ethanol per year about 1 quad of energy. So if all ethanol was diverted to food transport it alone would cover half of food transport.
In the event of a sudden collapse of oil alone, it is certainly very possible to continue the basic functioning of society under wartime conditions would continue to produce fuel and electricity.
It's true that most people would no longer have jobs to commute to, but in countries like Haiti the unemployment rate is about 70-80%.
People would do a lot of telecommuting and local public works--maybe building electric trams.
In a society with 50-60% unemployment it's difficult to imagine businesses making much profit, but that isn't the end of the world.
Perhaps all this speculation is 'bargaining' but I haven't seen any figures 'proving' that a total oil embargo alone brought any country to total anarchy/collapse. In fact, such countries Germany and Japan WW2 survived surprisingly well.
Germany and Japan did not survive well, they were in the malnourished stage of decline when they lost their energy supplies and were utilizing slave labor to provide other resources. They were also at a much lower level of complexity that they are today with lower populations.
Personally, I think there is a good chance that he is in the bargaining stage.
That's ad hominem, and unproductive. In fact, as far as I can tell I know quite a bit more about energy than you do. But, that's irrelevant. I don't present myself as an authority: instead I present evidence.
Ayers' work directly addresses that because he connects our energy supply with world GDP.
This is so odd. That's not what Ayres says. He says in his abstract: "We infer that output growth does not drive increased energy consumption and to sustain long-term growth it is necessary to either increase energy supplies or increase the efficiency of energy usage. "
How much clearer can that be????
Ok, this is getting funny. Did you just completely skip over the first part of the sentence in your rush to find evidence for your point of view?
Ok, this is getting funny.
Or, very puzzling.
Did you miss the words either and or???
Nope...but it all starts with energy because you have to have it before you can use it more efficiently. Plus, as you know, my view is that there is no way we will replace all that equipment while the economy is contracting like a popping balloon.
there is no way we will replace all that equipment while the economy is contracting like a popping balloon.
Do you agree that both the US and world economies are now growing, (albeit not as strongly)?
US GDP (BEA):
07-q1 5.4%
q2 5.8%
q3 5.2%
q4 4.5%
08-q1 1.0%
q2 3.4%
q3 1.3%
q4 -5.5%
09-q1 -4.7%
q2 -0.8%
q3 2.6%
q4 5.9%
10-q1 3.8%
q2 1.7%
World GDP (World Bank PPP exchange rates):
2006 5.4%
2007 5.4%
2008 2%
2009 -1.9%
2010 3.4%
Irrelevant. More evidence that you still haven't gotten the big picture.
Do you see that growth can't continue with the fundamentally unsound financial system we've set up? That eventually debt repayment takes up too much of ongoing revenue and the process must slow, then contract?
Then, as we contract, do you believe we are going to pay back all the debt that we've incurred?
Irrelevant.
Surely we should try to agree on a few basics. Can we agree that the economy is not currently shrinking?
Do you see that growth can't continue with the fundamentally unsound financial system we've set up?
But, how is it fundamentally unsound? Because it's not based on a gold standard? Have you read the history of the gold standard, and how it perpetually created deflation and recessions/depressions?
Because there's too much leverage? By what standard do we decide how much leverage is too much? For instance, the US had as much leverage after WWII as it does now. Yes, other things have changed - but still, what's the quantitative measure? How do we decide?
That eventually debt repayment takes up too much of ongoing revenue and the process must slow, then contract?
Debt repayment right now is pretty cheap, with interest rates as low as they are.
I've seen that chart before. I note that it appears to be from a laywyer turned goldbug - someone who makes their living selling investments in gold and other commodities (I note that gold is called "power money"). Might there be a conflict of interest there?
The chart shows derivatives at the top. Where do "Shadow Derivative" numbers come from? How do the derivatives numbers change when you net out all of the transactions between matching counter-parties? IIRC, when Lehman's was liquidated, the derivative numbers started at $63billion, and after all transactions were netted out, they fell to about $7B.
jaggedben,
Maybe I can have a productive conversation with you, instead. Andre keeps reversing things, and just ignoring things. It's very, very odd.
Ayres says in his abstract (that Andre linked): "We infer that output growth does not drive increased energy consumption and to sustain long-term growth it is necessary to either increase energy supplies or increase the efficiency of energy usage. "
How much clearer can that be????
The emphasis is yours, I note. But I don't think it has the import you think it has. In the context of your disagreement with Andre, increasing efficiency is just a corollary to finding other sources of energy to replace oil. Efficiency gains (which will certainly have diminishing returns, btw) still have to outpace oil depletion to grow GDP. One can be optimistic or pessimistic about the prospects for increasing efficiency, as I believe you and Andre are, respectively.
Again, I don't think Ayers provides either you or Andre with the theoretical clincher that you both seem to believe it ought to. It is all your other assumptions that account for your disagreement.
I agree that Nick still doesn't get it but I disagree with your assessment that the paper does not demonstrate my point.
The exact nature of Ayres and Warr's work is to show the link between energy and the economy and they have been working on it for some time now. Granger-causality tests are designed for this sort of thing.
This is the best work they have done so far and directly addresses the confusion out there about causality. I request that you read this paragraph again carefully:
Also, as you point out, Nick completely misses the first part of this sentence:
Remember that Ayres and Warr have been grappling with connecting energy to the economy for a while now, that's a major focus of their work and is specifically what they are aiming to provide evidence for. Earlier attempts were not as comprehensive as this one but they have been getting closer each time.
Yes, Andre, you don't need to convince me that there is a link between energy and the economy. (Moreover, I'm actually interested and a bit relieved to see that they only identify causality in one direction. I would have thought that the link was even stronger, i.e. a feedback.) Moreover, I don't think that you need to convince Nick of it either. What you need to convince him of, if you want to change his outlook, is that declines in oil are going to mean declines in total energy no matter our best efforts with efficiency or other sources. As you said yourself upthread, Ayers work doesn't really address that.
BTW, hopefully someone will laugh if I put my own bold tags in the following sentence.
"to sustain long-term growth it is necessary to either increase energy supplies or increase the efficiency of energy usage."
It seems to me that both of you are overlooking those words.
Hi, jb.
I think Nick's feet are nailed to the floor and after many, many months of this conversation I don't think he is open to changing his mind. Recall that he thinks it "unrealistic" that the world economy will contract as energy OR oil decline (see his quote elsewhere).
And I'm not overlooking efficiency, I've just judged that there is no way for us to make our systems more efficient while the world financial system is imploding.
No matter, it makes little difference in the long run. I'll keep letting people know that we are headed for contraction and eventually we will be contracting so quickly it won't matter much what either of us say!
P.S. I did chuckle at your bolded words.
I think Nick's feet are nailed to the floor and after many, many months of this conversation I don't think he is open to changing his mind.
Again, that's subtly ad hominem. I'm entirely open to changing my mind, if shown something that makes sense.
I've been thinking about energy (and related questions) ever since I read the first Club of Rome's Limits to Growth more than 30 years ago. I was much more pessimistic then, but I spent decades gaining professional experience and learning about resource/energy problems. I carefully developed evidence-based ideas before I started asserting things on TOD. That's why I don't appear to change my mind much.
Recall that he thinks it "unrealistic" that the world economy will contract as energy OR oil decline (see his quote elsewhere).
Let's be clear: as a practical matter, oil is the only energy problem we have. For better or worse, we have a lot of things we can burn for electricity, and wind, nuclear and solar to extend them until renewables can take over completely.
GDP per unit of energy varies significantly between countries and between the United States and Europe. Greater efficiency has and will permit an increase in the amount of useful work per unit of energy expended. Goods production can be maintained or increased using less energy per unit of production.
Having said that, GDP cannot be increased indefinitely given a finite or decreasing energy supply. At some point, increased efficiency will not be adequate to compensate for decreased energy supply.
Further, even if the above is true, I don't think it is really worth arguing over whether or not GDP can increase for X number of years given a declining oil supply. Oil production is going to decrease, so what will be will be.
Regardless of whether or not one agrees with Nick or Aangel, other constraints such as air, water, food, soil, land, ocean acidity, and climate change will kick in to make us much less productive and much less viable. These constraints will force the earth's inhabitants to cut back on production. This decrease in production will be even more pronounced amongst those billions who experience dieoff.
There is too much reliance on GDP as a proxy for well being, not to mention happiness. If I ride my bicycle to work or the post office, it reduces fossil fuel consumption, saves me money, reduces my weight, increases my heart rate, improves my health and others' health, and improves my well being. If enough people do it, it improves the whole community's well being and does a little bit to help the planet's well being. If I walking or bicycling to work, it might even increase my productivity. It is my experience that this is true, personally.
If reduced energy use, regardless of the reason, increases quality of life and enhances the quality of the air, the soil, the water, and results in decreases in use of other resources, this seems like a good thing. If this also decreases GDP, so be it, especially considering the fact that GDP sucks as an indicator of progress or well being.
I don't know for certain if we will ramp up other sources. I suspect, however, that coal will be ramped up in a stupid attempt to keep our totally destructive transportation system going either through something like CTL or electric vehicles. We don't need to replace all or even most of the existing equipment if we accept an alternative path of making our cities capable of accommodating most people's needs within a short distance of their homes. That is what Portland, Oregon is trying to do. This may fail, also, but will be more successful than trying to completely change out all our existing vehicles.
If the intermittent nature of renewable sources can be overcome or accommodated, then we may be able to limp along for several decades or maybe even longer. GDP, such as it is, will probably be significantly reduced. The question, though, is what kinds of lives will people be really living.
Further, I would prefer a massive, voluntary reduction in population. That is not going to happen, of course, so we will have massive dieoff. Unfortunately, we will have killed off most of the planet's other species before human dieoff occurs. The human race is a plague that is killing itself.
This is what Ayres said in 2005 (quoted in David Strahan's The Last Oil Shock) about the impact of peak oil on global GDP:
Fairly clear in his views, so it seems.
Hmm. What page is that on? I'd be curious to verify that quote, as this is completely inconsistent with his research.
No it's not. You are completely inconsistent with his research because you have misinterpreted what he is saying, as we keep trying to point out to you.
It's actually quite remarkable how you can misinterpret an entire body of work with titles like:
The Economic Growth Engine: How Energy and Work Drive Material Prosperity, 2009
Energy and Economic Growth, 2008
Accounting for Growth: The Role of Physical Work, 2004
The quote is on p.123, btw.
There are two keys here:
Energy and "work" are not the same, and energy and oil are not the same.
Are you clear what "work" is? It's freight actually delivered, as opposed to the energy input. It's an activity, not an input. In a sense, Ayres has been measuring outputs, not inputs.
Now, I'd be curious to verify that Strahan is quoting Ayres correctly, and if it's correct to verify that Ayres opinion hasn't changed since. Because there's nothing in his research that fits with that quote.
Don't you think it's a hint that he is saying something in direct contradiction to what you think he has been saying that perhaps it is you who is misinterpreting his work, as several of us keep pointing out to you?
Of course. I can understand why that quote would seem to validate what you're saying.
Nevertheless, it's not supported by his research. He may have been misquoted. We're told it was made in 2005. World oil consumption has fallen since then, but the world economy has grown by 15%. This is fully consistent with his research, but not at all with this quote.
Let me say it again: this quote was completely wrong. And, that it would be wrong was predicted by Ayres' research!
Again, let's look at the last few lines of the abstract of his work that you described as his best:
"...to sustain long-term growth it is necessary to either increase energy supplies or increase the efficiency of energy usage. Faced with energy security concerns and the negative externalities of fossil fuel use the latter option is preferred."
He's clearly saying that economic growth does not require growth in primary energy supplies, such as oil.
Yes, he's saying that energy is important. But, he's not saying that oil is uniquely important, or that there is any kind of 1:1 ratio between primary energy and the economy. In fact, he's saying that the link can be broken, and should be.
The quote is from page 123. Maybe you should settle this argument simply by emailing Ayres and asking him what he thinks. Given your track record of misrepresenting the work of others, however, you should probably expect a similar reply to the one you had from Nicole Foss.
Maybe you should settle this argument simply by emailing Ayres and asking him what he thinks.
Not a bad idea. Thanks. He may have been misquoted, or had a chance to rethink that comment - we're told it was made in 2005. World oil consumption has fallen since then, but the world economy has grown by 15%. This is fully consistent with his research, but not at all with this quote.
Let me say it again: this quote was completely wrong. And, that it would be wrong was predicted by Ayres' research!
It doesn't seem that important to me, because I don't give much weight to the personal opinions of authority figures when they conflict with the published literature and data. But, others might benefit from a clarification.
Given your track record of misrepresenting the work of others
I did make a mistake: I thought she considered energy an important near-term factor. Frankly, it was the only explanation I could find for her unusual results.
Her theories don't seem to allow good predictions. Here's a prediction from November 2008: "We appear to be beginning a market rally at the moment, which should lead to precisely this set of trend reversals. Such a rally is only temporary relief however. It may last for a couple of months, but then the decline should resume with a vengeance." http://theautomaticearth.blogspot.com/2008/11/debt-rattle-november-29-20.... That was 22 months ago...
Unusual claims require unusual evidence. I asked Nicole for quantitative support, and she said numbers weren't useful ("There are far too many numbers in this world that are not worth the paper they're written on. I build logical models grounded in historical evidence." http://www.theoildrum.com/node/6976#comment-724950 )!!
How can you be certain that global oil production has already peaked? You are misrepresenting Ayres' words again.
I'm not suggesting that oil has peaked. Certainly, it reached a higher point in 2008, and it may mange to rise further to a higher peak in the next year or two.
But, in this case this is an unimportant distiction. In 2005 we reached something that very close to an absolute peak, something that has been called "peak lite", where production didn't rise quickly enough to meet demand, and therefore prices rose sharply.
That kind of shortage, and the resulting price rise, is what this quote is talking about: it says "When petroleum gets more expensive everything that depends on it gets more expensive...". This really isn't true (core inflation barely rose in the period 2004-2008, which means oil price inflation didn't break out of the direct effects of rising costs of basic energy products like gasoline).
I'm actually hoping that these are not Ayres' words. If Ayres said that, it means he committed a common error for an "expert", which is to stray outside the realm of one's expertise. I suppose that's possible, but I'm hoping that Strahan misquoted him.
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Let me reassure you: I think we should move away from oil & FF ASAP. It's important to get things like this right because they support BAU by suggesting that without oil that our economy will collapse. The de facto message: drill, baby, drill, because without it we're going to hell in a handbasket. Corporate interests aren't afraid of people making apocalytic predictions about PO - they know they're unrealistic, and that in the long run we're going to move to effective substitutes. But, they're terrified of those substitutes, and they're delighted to have people out there discouraging any move away from FF as long as possible.
I have to agree with Andre here Nick. It's not surprising that someone whose research very robustly looks at the relationship between energy and economy would have such views. Note that scientific papers typically draw more conservative conclusions than the writer may express when interviewed in a less formal setting.
It's not surprising that someone whose research very robustly looks at the relationship between energy and economy would have such views.
Actually, it is. His research doesn't support it, as far as I can tell. He may have been misquoted. We're told it was made in 2005. World oil consumption has fallen since then, but the world economy has grown by 15%. This is fully consistent with his research, but not at all with this quote.
Let me say it again: this quote was completely wrong. And, that it would be wrong was predicted by Ayres' research!
Note that scientific papers typically draw more conservative conclusions than the writer may express when interviewed in a less formal setting.
There's a good reason for that. That's the purpose of peer review, and formal documentation. It prevents embarrassing mistakes like this.
World oil consumption has remained pretty level, statistically speaking, since 2005. It's still a matter of some guessing whether we've seen the all time peak or not. We have not seen a meaningful decline. As for world economic growth, I'll take your word for it.
The quote from Ayers, to be precise about it, states that the economy will likely peak when oil peaks. Since oil hasn't unequivocally peaked yet, the quote really can't be either verified or invalidated, yet. Neither is it clear what kind of time-correlation he is assuming.
Again, I haven't read Ayers work. But from what I've seen in abstract, his work looks robustly at the relationship between energy and economy. I do not see that it looks robustly at available energy supplies. Different assumptions about available alternatives to oil will lead to different conclusions about the practical implications of his work. Apparently, given the quote, Ayers own assumptions on energy supplies were pretty pessimistic regarding alternatives to oil back in 2005. (It's easy to criticize with hindsight.) Unless you can show me where Ayers actually predicted what has happened in the last 5 years, it seems to me that you are adding in your own point of view on available energy supplies when you say that his work predicted what has happened. Again (for the last time, may I hope?) let me say that I think you need to separate what you are getting from Ayers (the relationship of energy to the economy) from what you are getting from other places (ideas about available alternatives to oil). Your conclusions about the likely future of the economy are not based on Ayer's work alone.
Upthread, you said...
What I'm trying to tell you is that this 'misunderstanding' is possible because the paper you linked to is agnostic about the relative importance of oil among our energy supplies. From what I've seen, Ayer's work neither predicts that oil is not so important (as you say) nor that it is extremely important (as Andre says.) I myself am fairly agnostic about the importance of oil, so I'm not so inclined to see Ayers work, combined with peak oil, as narrowly predicting a certain kind of future.
Since oil hasn't unequivocally peaked yet, the quote really can't be either verified or invalidated, yet. Neither is it clear what kind of time-correlation he is assuming.
It's true - we don't really know exactly what he's predicting. I suppose that's part of the problem with an informal quote like this. Still, the person who posted it added below the quote: "Fairly clear in his views, so it seems.", so he thought it meant something fairly specific.
And, really, I think it does. The quote says: "The economy is utterly dependent on petroleum, and I think it is highly likely that when oil production peaks, so will the world economy. "
That's fairly specific, and says to me that when oil production stops growing, as it did in 2005, the "economy" will stop growing. And, it didn't. Oil production and consumption fell in 2006, oil prices rose sharply, and both the world economy and the US economy kept growing. Heck, the world economy's growth rate didn't slow down one whit. Then the same thing happened in 2007. We had a recession in 2008/9, and now world/US economies are growing again, while oil consumption is still below the levels of 2005.
Let me clarify Ayre's work. First, he breaks a directional, fixed link between Primary Energy (oil, coal, etc) and the economy, and shows that the economy can grow without growth in Primary Energy. Take a look at some quotes: ""We infer that output growth does not drive increased energy consumption and to sustain long-term growth it is necessary to either increase energy supplies or increase the efficiency of energy usage. " This makes it quite clear that the economy can grow without growth in oil, or coal, etc. It also makes it clear that we could reduce our consumption of oil or coal, while maintaining or growing the economy (although, of course, growing the economy while reducing consumption might be harder because that would require larger growth in efficiency).
Here's another quote: "...to sustain long-term growth it is necessary to either increase energy supplies or increase the efficiency of energy usage. Faced with energy security concerns and the negative externalities of fossil fuel use the latter option is preferred." That's a very strong statement that economic growth without growth in FF energy consumption is both possible and preferred.
2nd, he clarifies that "useful work", or exergy, is what drives the economy. Exergy is the same whether it comes from inefficient FF (like a one passenger, 10MPG SUV) or efficient FF (a Prius), or an EV. His research is completely agnostic about energy sources, whether oil, coal or wind.
There seems to be a persistent confusion about Ayres' work. He says that exergy is important to the economy, but that primary energy (oil, coal) is not. People see the word "energy" in his work, and assume he means primary energy - he doesn't.
it seems to me that you are adding in your own point of view on available energy supplies when you say that his work predicted what has happened.
I'm saying that his research explains what has happened in the last 5 years. His research says that economic growth is possible (and preferred!) without growth in primary energy, and that's what we saw.
----------------------------------------
The quote betrays a lack of understanding of energy markets and consumption. It says "When petroleum gets more expensive everything that depends on it gets more expensive...". This really isn't true (core inflation barely rose in the period 2004-2008, which means oil price inflation didn't break out of the direct effects of rising costs of basic energy products like gasoline).
If Ayres said that, it means he committed a common error for an "expert", which is to stray outside the realm of one's expertise. I suppose that's possible, but I'm hoping that Strahan misquoted him.
-----------------------------------------
This has been a long conversation. Maybe too long. But, I hope what I just said helped clarify things.
I'd really, really like to see us kick our oil dependency ASAP. People who suggest that's not possible without economic catastrophe are really just slowing down progress. That's a big reason I put effort into showing that oil isn't necessary to prosperity.
Certainly there is a lot of scope to learn from others, as looking across countries, there are wide variations in GDP/Oil
using the simple Energy/Gross Domestic Product (E/GDP) ratio, the amount of energy needed to produce a dollar's worth of goods and services in the U.S. economy fell by more than half between 1949 and 2004
I'd model the Oil-GDP correlation, as a lazy Z curve, cubic like.
There is considerable elasticity in the small movements, and +/-15%, clearly is 'easy', as we have seen this already.
Where it gets tougher, is suppose a -45%, or -75% decline in oil, and especially the SPEED of that change.
This is why the shape of the tail is so vitally important.
Comparing across countries, we see the EU gets 151.3% better on their GDP/Oil, than the USA, Germany does 172%, so it looks like the USA can nearly halve the Oil intensity, without too large a relativity phase shift.
Canada, Russia and China have lower GDP/Oil, but still within a 163% ratio,
Ideally, the worst performers 'lift their game' fastest.
The USA 'wins' here, because they consume the most, followed by China, India, Russia.
If you measure Exports/Oil, the USA comes in quite poorly. (Germany does over 9x better, in exports/oil, than USA)
All up, on GDP:Oil we see a 'footprint' of roughly +/- Sqrt(3) or 173%.
- which is not huge (less than 2:1 in each direction).
A change to 1/4 or 1/8 is probably going to bite much harder, but hopefully by then, efforts will be more focused.
Makes sense.
I am certainly not a fan of Cheney, but when I started researching the subject of peak oil it didn't take long for things to click and allow me to finally see the motivations behind the Bush administration. The depth of these motivations had always eluded me but now make sense, even if I don't agree with the actions taken.
Cheney may be a bastard but he has a very good understanding of the place of oil in the world's economy. It is indeed the foundation we have built most things on.
This is not to say that the foundation could not be something else, but how can you replace the foundation for a house of cards while it is still standing?
DD
Cheney is the foremost representative of the industrial sector that is fighting the transition away from oil.
He is fighting for his narrow self interest, and will say and do anything to promote it, no mater how destructive to his country or the rest of the world.
Without a breakdown of the manufacturing growth you claim, you aren't making your case. It is well known that many US manufacturing jobs have disappeared (e.g. TV production) as a myriad of products are made in China and third world countries. So the energy use has been offshored and cannot be attributed to declines in energy use relative to GDP.
It is also improper to use the GDP when assessing the territorial economic activity of a country. It should be the GNP. But even the GNP can't track energy flows correctly since parts can be imported and assembled in the USA giving a faux US product.
Without a breakdown of the manufacturing growth you claim, you aren't making your case.
True - you need data. See http://www.census.gov/manufacturing/m3/index.html, including http://www.census.gov/manufacturing/m3/historical_data/index.html , Historic Timeseries - SIC (1958-2001), "Shipments" http://www.census.gov/manufacturing/m3/historical_data/index.html.
It is well known that many US manufacturing jobs have disappeared (e.g. TV production) as a myriad of products are made in China and third world countries.
Yes. People are misled by the fact that US manufacturing employment has dropped substantially in that period. But, that was caused by sharply rising manufacturing labor productivity, rather than by a decline in absolute levels of manufacturing output.
It is also improper to use the GDP when assessing the territorial economic activity of a country. It should be the GNP.
GNP is "national product", and it includes things outside the US. GDP is "domestic" product, and that's what we want.
If energy (in this case embedded in oil) is fundamentally linked to gross economic output, then it stands to reason that an increase in the oil/GDP ratio would mean that GDP is indeed more dependent on oil.
For instance, if 1 oil unit = 1 GDP unit then a 10% decrease in the availability of each energy unit would mean a 10% decrease in GDP.
If 1 oil unit = 2.5 GDP units then a 10% decrease in available energy would mean a 25% decrease in GDP.
Provided you accept the assumption that energy is fundamentally linked to economic output (which Hirsch obviously does) then this inference is not strange at all.
This means that the more efficient we become in using an energy supply, the more vulnerable we are to any shortages of that supply.
DD
Excellent question.
Well, first, we're really talking about oil, and oil is not fundamentally linked to economic output. This is quite easy to show: we can replace kerosene lighting with electric; oil fired generation with coal, gas, nuclear, wind, solar, etc.;ICE vehicles with EVs, ICE trucks with electric rail, oil heat with gas or electric (resistance or heat pump), etc, etc.
2nd, even if we were, less is always better: greater efficiency reduces trade deficits and overall demand, making things more resilient.
Let's illustrate with a simple example: a house with kerosene lighting. This was the first major application of oil, but the same thing applies to vehicles, generation, or any other application of oil.
Let's say we have 4 kerosene lamps, each of which uses 1 liter of kerosene per week, and produces 50 lumens for 100 hours. In 1880 we use 4 L per week, and produce 20,000 lumen-hours total. We're getting 5k lumen-hrs per liter.
Now, in 1881 we buy more efficient wicks, which produce 55 lumens. We've become more efficient, and can produce the same light with two lamps. We're now getting 10k lumen-hrs per liter, and spending 10% less on kerosene. We can reduce the demand on limited kerosene supplies, and save some money for that rainy day when Pennsylvania oil production peaks, and we have to pay for more expensive kerosene from far off places like Midland Texas. IOW, we can afford to pay more for kerosene, so we're more resilient than we were before (and we're more resilient than our neighbors).
Ok, in 1882 we install one of those newfangled Edison electric bulbs. It produces light for 25% as much money, and we've reduced our kerosene purchases by 25%. We're now getting 33% more light per liter of kerosene, and we have a strong feeling that it's now ok if those oil rigs leave town, taking with them those noisy Teamsters, putting deep ruts in the town roads hauling those barrels of oil to Mr. Rockefeller's refinery. In other words, we're much more resilient.
Does that help?
There you go again, in direct contradiction to the best work on the topic. DD, you've been following along so you can safely ignore what Nick is saying.
Energy is directly related to the size of the economy, as the good work of Ayres and Warr demonstrates. The best paper on the topic is the following:
Evidence of causality between the quantity and quality of energy consumption and economic growth
Of course energy is directly related to the size of the economy. However, what is the quantitative degree of importance compared to other factors? Assuming a relatively inefficient and,therefore, high ratio between energy use and production, can countries like China learn to produce more with the same amount of energy or the same amount with less energy?
Regardless of whether or not you or Nick is correct, it would be beneficial to focus on the efficient use of all resources, including labor and energy. This would include moving towards car free cities. Alternatively, we can just take whatever hits us when we reach a serious deficit in oil as well as of forms of usable energy.
GDP will probably decrease in the future but that does not mean that well being will decrease in direct proportion to GDP decrease, especially considering that natural disaster actually help GDP increase to clean up after the disaster.
Whether or not GDP can increase given the future of energy and oil supplies seems very important to both of you. I think both of you make good arguments, but I think the world would be better off if it could get beyond the daily obsession with GDP growth.
Long term survival of mankind? What is the time frame? Yes, entropy will probably eventually get most of us. And then there is the Sun burning out thing.
There are a number of ways of looking at this :
If you consider 'BAU Lazy Energy', then if a company wants to double output, they just build another identical factory and use exactly twice as much energy.
When energy is cheap, this is how things are mostly done.
However, there is also smarter energy, where you start to remove elasticity and waste, and use better processes.
Now, that second factory could consumer 50% of the energy.
Notice that this was done, by changing how things are done.
There are examples around, where GDP has gone up, but energy has gone down, so quite clearly they are NOT locked by some fixed EnergyToEcononic Constant.
So, we CAN learn from those who do this better.
Then, the smarter question (instead of Yes it is/ no it's not), is to ask HOW LOOSE is the coupling, and how much elasticity is there in this coupling.
Can our company above, produce the same output with 10% (!) of the energy ?
Yes we've made it Tough. {In many sectors, the same output needs MORE energy}
How about using a different energy mix ? Now, the apparent consumption of one fuel can fall, because it is actually being offset by another.
[or, our company can export the production to China, and gain the illusion of an increase in GDP, but those Chinese factory deplete faster than what they replace....
They've Ticked all the corporate boxes, and no one checks the global budgets ]
Yes, I didn't phrase it carefully enough. OK, let's look at the abstract of a paper linked above (the link in this comment didn't work):
"We infer that output growth does not drive increased energy consumption and to sustain long-term growth it is necessary to either increase energy supplies or increase the efficiency of energy usage. Faced with energy security concerns and the negative externalities of fossil fuel use the latter option is preferred."
So, we see that energy in some form is important, but that growth can take place without growth in primary energy supplies. In fact, the authors prefer the no-energy-growth option.
Not necessarily. Australia has an enormous amount of money tied up in its superannuation (retirement) system which ha found it hard to find profitable investment opportunities. Becasue this system is basically driven by greed and the necessity for growth, it would be capable of funding $60 billion over say 10 years quite easily. I would imagine that governemtns would cheer it on with a suitable tax arrangement, particularly if this had the long term effect of bring down the trade deficit.
Isn't that money already deployed? Surely only some small portion of it could be shifted over, no?
It's being added to constantly. We have compulsory supoerannuation paid by employers at the rate of 9% of an employees wage/salary. It is proposed to raise this to 12% over the next decade. Much of this has gone inot internatiaonl and domestic stocks along with pumping up the real estate bubble. The superannuation systems could easily fund at least $2-3 billion a year for CTL/GTL even if it was only modertaly profitable. As long as the returns were steady and predictable, as I'm sure they would be it would be a good finacial match as the capital is invested for the long term and the industry would need certainty of funding. Becaue our retirement system is essentailly privately operated but governemtn regulated, many superannuation funds would throw some money at CTL in an IPO. I'm not advocating for CTL, just demonstrating that the likliehood of Australian CTL industry is quite high, again as long as it is profitable.
Ok, fair enough. Looks like there is some money if the current financial arrangement stays similar to what it is now.
"you may find coal-to-liquids technology personally repugnant, "
You are assuming it's only to burn. CTL can also provide the chemical feedstocks we need. CTL may not be able to provide BAU, but for the 10% of oil use that is really critical non-combustion uses it should be feasible. And a couple more plants should be able to keep the trains running too.
Think triage; what uses of oil are truly critical, and how do we keep up that much supply?
I'd like to suggest that those of us who disagree with Archibald's assessment of climate change still consider what he has to say here: not as a message of hope, but as a warning.
True enough. But the editors would prefer that we don't take Archibald in full context. Thus Gail's scrubbing of Archibald's presentation. Thus Gail's removal of comments that point to his full history.
There are things to be discussed, besides climate change. Let's keep things in the direction of coal-to-liquids, the subject at hand.
Let's discuss climate change, because really no one would have any objection to coal-to-liquids projects were it not for that.
I have already said let's not. The people on each side would still be on the same side at the end. This is not our chosen area of discussion.
How about we discuss the credibility of the author? He has presented his case based on his views of ACC, using an analysis which would not pass muster in a peer reviewed journal, instead publishing in Energy&Environment, a journal which has repeatedly displayed an anti-science bias. He also references work by others whose theories have not been supported by other workers. Given his obvious analytical errors, are we also to believe his calculations presented here as well?
BTW, who made you sole editor and agreed that you should censor posts which you disagree with?
E. Swanson
When you put in as much work as the volunteers on this site do, you can have a say in its direction. They have repeatedly said that they don't want to go into climate change.
It's their site and they can do what they want with it. If you don't like that, you are always free to go somewhere else.
Uh, I've been posting on TOD for more than 3 years. I don't recall any other editor(s) claiming that ACC was not a topic for discussion. Got a link to support such a claim?
Besides, are you going to ignore discussing the errors in Archibald's views of ACC science and accept this work without question?
E. Swanson
Leanan has said it repeatedly and so has Gail. I know you've posted a lot, I'm at a loss as to why you haven't seen this before. (And no I'm not going to go look for a link, I don't want to spend the time to do that.)
I'm going to ignore his views on climate science but concentrate on his views of CTL. I understand the need from a forum moderator's standpoint for keeping the conversation narrow. I have that role in other areas in my life (facilitating discussions) and if the conversation isn't directed very often it becomes a mess.
The problem is the last slide has recommendations that seek to kill climate and renewable energy targets, which means the subject has been broached in the article itself.
That still doesn't mean we need to discuss climate change here. Or renewable energy targets.
Then in all fairness shouldn't at least the first half of the last slide also be removed from the presentation?
Precisely. It's like one side gets to speak, and the other side is not allowed to.
Gail, this is incredible. If you didn't want to provoke a discussion on these things, then the prudent thing to do would have been to NOT publish David's piece. It is baffling to me that you put up a post and you are now saying "don't discuss certain things in it."
I endorse Gail's efforts to focus. The impact of "Climate change" is negligible compared to shutting down our economies for lack of fuel imports. Get with it and focus on Archibald's Coal To Liquids discussion.
Yes, well, clearly I disagree with you about the impact of climate change.
of course you put in the work and have the right to direct the discussion but Let's discuss climate change, because really no one would have any objection to coal-to-liquids projects were it not for that. is the elephant in the room in this discussion isn't it........! by the way arctic freeze up has begun again as of September 19. The third lowest minimum ice extent on record. Melt that arctic ice and we do get a whole lot of coal very close to shipping lanes don't we...that would be very pertinent to world CTL potential would it not?
OK Gail, let's not discuss climate change in this thread, but do let's talk about the other "sustainability" issues with coal. In order for coal-to-liquids to put even a small dent in the peak oil problem, the coal industry would require a massive expansion. Such an expansion threatens food security and water security here, remembering that Australia is already the driest continent on earth.
I agree, and the cheapest source of coal is that currently being burnt in thermal power stations. Those coal-fired power stations get replaced by nuclear, and the thermal coal goes into liquid fuels.
So, we wait a couple of decades until the nuclear power stations are built before CTL saves us from peak oil? And assume that world energy markets will remain stable enough to give the infrastructure planners the right long term price signals? And that the impact of peak oil on financial markets won't prevent the necessary investment? Just a couple of little glitches here.
Euans Mearns has removed climate change discussion from his posts - Just ask Matt from Australia, who likes to write from the pro AGW side.
We do our best to stay away from climate change in Oil Drum posts, except on rare occasions when we have done research directly relevant to the question.
I would describe our staff as fairly divided on the issue of AGW. Some think AGW is correct, and is an issue. Some think AGW is incorrect. Some think other things--most often, it is correct, but it doesn't matter, because of peak oil.
The only reason Climate Change shows up in Drumbeat is because Leanan wants it there. On a volunteer site, volunteers get some latitude.
This is astounding. What you are saying, Gail, is that TOD has banished the concept of Climate Change from discussion (except for Leanan's Drumbeat).
Are there any other ideas that are regularly censored from articles and comments?
This really needs some explanation.
Bart
Energy Bulletin
The site is about Energy and Our Future. We are not a climate change site. We do not have the expertise in climate change, and we certainly do not have agreement among staff members.
At some point, I suppose our position may change, but as it stands, the issue is more divisive than anything else, so we have chosen to stay away from it.
Gail, a small quibble:
I think it's perfectly valid for TOD to choose not to deal with AGW. No one can do everything.
OTOH, AGW is clearly a sub-topic of "Energy and Our Future". We have to admit that we choose not to deal with every energy-related topic.
Energy is directly tied in with climate change whether we like it or not.
To discuss energy, especially coal, without regard to its externalities is completely ludicrous. To discuss its economics without regard to externalities is not a complete treatment of the economics. Failure to take a holistic view towards energy, and especially coal, is the kind of error which has led to the mess that the planet is in.
Energy and our future? What kind of future are we going to have with unconstrained energy growth that does not deal with the co2 problem?
If one is just going to focus on the direct costs of coal without regard to water use, air pollution, land use, and climate change, there is no point in discussing the issue.
Day after day after day, we have had posts on the oil spill. That was primarily about the external negative impacts of oil use and production. I don't think this site is replete with biologists, but it was consdiered completely appropriate to be talking about the spill. If the impacts were out of bounds or irrelevant, what was the point of talking about it.
We don't have to have a full fledged debate about the science of climate change to be able to acknowledge that it should be considered in a discussion of coal use. Those who don't believe in AGW or don't believe that coal use has an impact on the planet are free to disregard that particular facet of the discussion.
I think, as a sometime commenter, that it is entirely appropriate to have TOD concentrate on fossil fuel supply/demand issues to the exclusion of AGW issues. There really other places on the web for hammering on AGW, but I would like to see some examination of the CTL technology and economics. Has there ever been open publication of pilot plant operating experience? Perhaps CTL is just a scam. Shouting down discussion of CTL because AGW is seemly more important will never establish whether or not CTL is a COS.
I, too, find Gail's description of TOD's position amazing: "...but it doesn't matter, because of peak oil."
If Leanan is the only one who wants AGW here...wow. I have been coming to this site almost from its inception. That TOD has decided that AGW is irrelevant to its discussion of energy is jaw-dropping. Concern about AGW, for example, might postpone the peaking of oil. AGW itself might postpone the peaking of oil. AGW itself might force our choice of the next energy source.
Furthermore, does TOD think global warming--climate change--is really a matter of serious scientific debate? Have the energy folks been able to push aside concerns about AGW?
We listen to engineers write about the technicalities of coal mining, etc...are they really spokesman for big coal? Has TOD been co-opted so that it has become merely a discussion of what the next energy source will or should be?
I suspect that TOD has made a recent, conscious decision to set aside any discussion of AGW...and that the big energy folks have had a hand in this. In short, TOD has sold out.
Amazing. Disheartening. TOD is really not a serious energy forum.
I actually am in favor of the policy. Leanan allows some (very limited) discussion on Drumbeat, but not much.
As important as AGW is, whereever it is discussed it turns into a learn-nothing shoutfest, and I don't want that here. What TOD editors, I believe, are trying to avoid is every thread becoming a 500 comment argument back and forth about the Medieval Warm Period and Little Ice Age.
Have you tried reading the comments at DotEarth?
The shoutfest you describe is the result of corporate encouragement.
This means the corporate deniers have won.
"The billionaire brothers Charles and David Koch are waging a war against Obama. He and his brother are lifelong libertarians and have quietly given more than a hundred million dollars to right-wing causes."
http://www.newyorker.com/reporting/2010/08/30/100830fa_fact_mayer?curren...
and
"A dark ideology is driving those who deny climate change. Funded by corporations and conservative foundations, these outfits exist to fight any form of state intervention or regulation of US citizens. Thus they fought, and delayed, smoking curbs in the '70s even though medical science had made it clear the habit was a major cancer risk. And they have been battling ever since, blocking or holding back laws aimed at curbing acid rain, ozone-layer depletion, and – mostly recently – global warming.
In each case the tactics are identical: discredit the science, disseminate false information, spread confusion, and promote doubt. As the authors state: "Small numbers of people can have large, negative impacts, especially if they are organised, determined and have access to power."
http://www.guardian.co.uk/commentisfree/2010/aug/01/climate-change-robin...
We don't try to be a climate change site. We have discovered that the staff members have such diverse views that it is difficult to even discuss the subject.
There are several staff members who are very much on board with what the IPCC says. Leanan would be in this group. She is definitely not alone. There are quite a number of others who believe as she does.
Some of the other views would include the following:
1. If peak oil is happening rapidly, and causes a rapid population decline in the next fifty years, climate change won't make much difference--very few of us will be around to observe it anyhow. Those who are left can just move to the parts with better climates. The world has adapted to all kinds of changes in the past, and will to this one again.
2. IPCC model is built in a way that assumes way too much fossil fuels. Even if you assume a fairly high amount--the amount the IEA is forecasting--the implied degrees of warming seem to be much lower than what the IPCC says.
If you assume a more realistic amount of fossil fuels because of peak oil, (lower than the above graphic) then the indications would likely be lower yet.
3.The IPCC model is OK, but we are kidding ourselves if we think we can do anything about it. Even if we could convince the folks in the current generation to leave fossil fuels alone, why would the next generation not burn them? Also, it does not look like we realistically have good options for alternatives, so why spend a huge amount of money on a boondoggle? We would be better off spending the money on things that would better adapt us for the life ahead--draft animals, simple tools, low tech wind mills, etc..
4. Several (some with PhDs) have looked into the question extensively, and think the IPCC model is just plain wrong.
And some probably have mixtures of these and other views.
Discussing climate change on Drumbeat seems to lead to endlessly long unproductive discussions.
This would be a good topic for a separate discussion thread. Your post here is going to massively derail the discussion of coal-to-liquids, which was what you were originally trying to avoid.
Those who are left can just move to the parts with better climates
You who are on the road
Must have a code that you can live by
And so become yourself
Because the past is just a good bye.
Teach your children well,
Their father's hell did slowly go by,
And feed them on your dreams
The one they picked, the one you'll know by.
Don't you ever ask them why, if they told you, you would cry,
So just look at them and sigh and know they love you.
And you, of tender years,
Can't know the fears that your elders grew by,
And so please help them with your youth,
They seek the truth before they can die.
What model?
Reserves can be tabulated and compared.
However some Peak Models make no sense.
The world uses 12G toe of fossil fuels per year and even Rutledge says there is 1000 Gtoe to be exploited which works out to 83 years at current consumption. If we use more per year the CO2 spike gets higher as the earth doesn't absorb CO2 very fast according to physics plus there are secondary sources such as peat or wood burning caused by GW.
Thank goodness we're getting off of Climate Change and getting back to Doom!
Let's talk about Doom for a while! That is a much more salient discussion than Climate Change!
;-)
DD
Gail, this would be something worth doing a post on. I believe that your assumption that peak oil will lead to rapid population decline is not necessarily warranted. A rapid rise in poverty and hardship is not necessarily synonymous with a rapid decline in population. Look at Gaza.
You do realize that many climate scientists believe we are committed to at least a degree of long term warming even if we stopped all emissions tomorrow. I think that it's possible to overblow this point about the IPCCs FF assumptions.
There are multiple issues ahead of us, and there are substantial cash flows in AGW, and those can interact strongly with Finite Affordable Fuels.
An excellent example, is the recent serious speed wobbles in the EU ETS schemes, which because of the recession and falling emissions, will need political intervention to avoid them going backwards.
Australia looks to be dumping ETS, and moving to Carbon Tax.
The real question however, is what happens to the revenue.
Much of ETS has proven to be a sham, with churn, rorts, pass-on-the-price, windfall profits, and very little actual CO2 reductions.
If a focused carbon tax is used to target double benefit infrastructure, ie fund build-outs that benefit BOTH AGW and FAF, then you can get the best return on the investments.
In many cases, this is already occurring, but not all decisions are smart.
Australia can easily and cheaply focus on liquid-injection LNG, to both lower emissions, and lower finite fuel exposure. This is real, and right-now.
Australia can also take a small portion of the revenues, to apply incentives to move to lower fuel usage and lower emissions come too.
Another double benefit.
These simpler things, clearly go into the queue, ahead of CTL.
Australia should certainly follow Coal to Liquids, even to pilot plants, but CTL may not be the best return on the investment.
Pilot plants, allow real data, not vacuous power-point arm waving.
There are clear signs of Gas being used to displace Oil, and so extend FAF half lives, and Coal is the next logical life extender.
We also need to remember, many countries have no emissions rules (or conscience) at all. So a Carbon Tax, purely as a hair-shirt is simply dumb.
There will be situations where a combined spend rule is used.
perhaps $1B on a 80% emissions removal, 20% FAF displacment, and another $1B on a 80% FAF reduction, and 20% emissions, or even 100% FAF reduction, and emissions neutral.
I would stipulate that volunteers get to set the rules. However, volunteers should keep in mind that the site also exists because dozens of people take an active interest in it. For most people, it is impossible to think of energy without thinking of climate change. They cannot be delinked except in the artificial and unrealistic way you have chosen. For me, and I am sure many others, TOD is my favorite site. However, it is my favorite site because people are generally free to link the externalities associated with energy production to the energy production itself.
There are many discussions here that are tiresome and, therefore, skimmed over by different people depending upon the subject. However, everyone is free to skip posts that they are not interested in or think are a waste of time.
Life would be a great deal simpler and more pleasant if we could just focus on getting more energy production in a vacuum that ignores the world in which energy exists. Too bad people disagree. But that is what makes TOD worthwhile.
I am sure the staff is divided on a lot of topics, including the viability of CTL. So what. Most discussions begin and end with people disagreeing. So what. There are those people, however, who are capable of changing when given a well researched, fact based argument over a period of time.
It's science, Gail.
Is TOD anti-science?
Who thinks AGW is incorrect?
I think the readers want to know who you are protecting.
Is staff politics running TOD?
AGW will have a huge effect on energy policy.
I remember when Kharecha gave his talk on AGW scenarios at ASPO, reaching out to the Peak Oil community.
Gail, do you want to leave the impression that TOD sides with Big Oil(which continues to dismiss Peak Oil and fund AGW deniers)?
You've been down that road before(Chevron, tar sands).
I suggest you have a poll where the readers decide that policy.
It's science, Gail.
Well, some of it is. "X amount of CO2 causes Y amount of temperature rise" is within the domain of science. So is "Y amount of temperature rise will cause additional effects A, B, and C."
But "The world will produce X amount of CO2 in year Z" is economics, crystal-ballgazing, and guesswork. And "Effects A, B, and C will affect humans in ways D, E, and F" is sociology, more economics, and more guesswork. And "We should do G, H, and I to prevent CO2 from reaching X" is philosophy, actuary work, and politics.
Only one of the criticisms of climate change mentioned in Gail's list of views held by TOD editors falls within the domain of science. And it's no more than an argument from authority.
Only one of the criticisms of climate change mentioned in Gail's list of views held by TOD editors falls within the domain of science.
It's hardly guesswork unless you think climatology is guesswork.
This is the you-can't-the-weather meme of deniers and there is no doubt that human generated CO2 and other human activities are causing CC so the solution is simple--stop doing it, as doctors tell patients complaining of pain. Deniers pretend there is no pain.
The IPCC recognized that there was a problem with the rate of emissions of CO2 back in the early 1990's. Previous modeling efforts tended to focus on step changes in CO2 levels, often using a doubling of pre-industrial levels to run the modeling experiments. The IPCC developed a series of emission scenarios in 1992 to address this obviously unknown. The reasoning was that each modeling group should use the same scenarios in their experiments, thereby removing that unknown from the experiments.
Back in 1992, the production estimates by the likes of the EIA and IEA were much different than they are today, so those IPCC scenarios are probably invalid. But, they were the best available at the time. Only recently has Peak Oil gained more acceptance and, as a result, the consumption/emission projections by the EIA/IEA been reduced.
The obvious problem is that after Peak Oil, the result is likely to be a scramble to utilize other fossil fuels, coal being the most obvious first choice. If those resources are put to use the same way that oil was used, i.e., burned for thermal power and in IC engines, the result will be greater CO2 emissions than that from burning the equivalent BTU's of oil or natural gas. CTL is one such use for coal and moving to CTL would likely continue the BAU emissions of CO2. The resulting scenarios for future emissions become more foggy, since the emissions would be the result of an unknown mix of energy sources, using fossil carbon, nuclear or renewables, a mix which will be influenced by both economics and political decisions yet to be made.
But, this does not mean that one can simply ignore the impacts of CO2 emissions, given that we can't know the exact trajectory of future emissions...
E. Swanson
Are there any TOD regulars or friends with an existing climate-oriented blog? Maybe a link to continue the discussion elsewhere would be in order.
Almost every climate-related topic gets covered at
www.realclimate.org
Realclimate is too big for a relatively small group to go at it. I was thinking of something smaller like "the cost of energy," or DeSmog Blog, if their owners are reading.
sf,
You could easily start a thread at any number of peak oil forums... I don't think CTL is economically viable so I wouldn't want to discuss unlikely scenarios. Or you could wait until Leanan comes back and post a comment in the Drumbeat...
Speaking as the proprietor of The Cost of Energy (http://www.grinzo.com/energy/), I can say with reasonable authority that I'm here on a daily basis, even if I don't post much.
I feel compelled to say that I find this position of "the first rule of ACC is we don't talk about ACC" to be quite puzzling. I'm firmly of the belief that you simply cannot talk about either CC or PO without talking about the other, as well as water issues (that whole energy-water nexus thing).
As for the position that the people who own or run or whatever this site are divided on ACC -- who cares? Have the discussion, and I'd bet my keyboard that everyone will learn a thing or three. Yes, there will be, how shall I put this?, a bit of friction from time to time, but again, who cares? Enforce a rule about civility if you want, but you can't act as if ACC isn't important, whether you believe in it or not. As a topic it will clearly have an influence on our energy policy and international relations for decades to come. That should be more than enough to justify its inclusion where appropriate. And in the case of CTL, it's about as appropriate as any TOD topic could be.
Maybe things will change and we will start talking about climate change. But I would expect posts to be of the type "Why peak oil makes AGW less important."
I think for some people, as they get more involved with peak oil and where it is leading, AGW tends to recede in importance. People who come to peak oil from a sustainability background seem to assume AGW has huge importance for everyone.
History doesn't help much on this either. The IEA and others seemed to want to avoid talking about Peak Oil, so instead chose AGW as a topic to convince every one of our huge need to get off fossil fuels. To outsiders looking in, it looked like AGW (based on models with very inflated estimates of fossil fuels) was the real problem--and peak oil was not a problem. Maybe the view was right, but it rubbed a lot of peak oil people wrong. The AGW folks can''t talk about peak oil, because it destroys their models. If a person is really concerned about peak oil, then AGW becomes much less of an issue, because the peak oil issues come so quickly.
This is about half true. As I recall NASA climate scientist James Hansen writing, there's not enough oil in the ground to cause disastrous climate change if we burn it all. But if we burn all the coal it is quite another story. Compartmentalizing pieces of "Energy and Our Future" and talking about only some of them does not do this site justice.
The two possible scenarios need to be modeled and compared. If we go coal to liquids how "heroic" can it get?
is BAU on the cards if mega scale engineering efforts are thrown at coal, tar sand, shales etc?
It is my guess its only real game in town that can effect total liquids .
what does that world look like.
IT is very important from "our" own credibility POV we can dispassionately stare this scenario in the face because if we cry peak liquids now(ish) as a default consensus position and it doesn't occur because there
is an armyare armies of Bagger 288's. chewing up the earths crust our voice will have little impact in the debates that follow.think long term/ TOD's strength is primarily analysis and modeling with policy and ethics accidentally on purpose split off into sister threads (campfire etc). If ToD can be ahead of the curve on what this means we will have more power and influence and we want that... dont we?
People here need to question cherished biases such as overly emotional investments in predictive scenarios. irrespective of how such things my come to pass we should present a range of realistically possible outcomes and then the debate follows... this holds even for all those who are convinced of their position be it we all fall off the cliff into the gorge or we collectively come so hard during the technological singularity time starts to flow backwards.
we need to view this unconventional oil thing dispassionately. Is BAU going to carry on powered by this huge bonfire of stuff?
for how long?
yes the climate thing..it means...what exactly?
get it out on the table with all the ABC's for comparison and showing the working out in the margin
I realize AGW adds another dimension to an already complex topic set. Our future energy direction could make AGW less imporant (i.e., nuclear, renewables, conservation, etc) or it could stay on the BAU track (i.e., CTL) and fall into the range of AGW possibilities that have been projected.
If CTL is raised, then negative effects of CTL are going to be raised, otherwise the examination will be one of artificially limited scope.
If some members of TOD have PhDs outside of the field of climate science and think the climate scientists (including a broad, multidisciplinary study from MIT that just doubled their previous temp rise prediction) don't know what they are talking about, then clearly informed TOD readers will tend to listen to those scientists who have expertise in the field.
>If a person is really concerned about peak oil, then AGW becomes much less of an issue, because the peak oil issues come so quickly.
It's all about risks. If a mitigation for Peak Oil exacerbates AGW, then we would simply be irresponsibly kicking the can down the road instead of coming up with a genuine solution. And a CTL solution that focuses on BAU is unquestionably outside the realm of solutions that TOD normally espouses.
And espousing the curtailment of GHG and renewable targets will unquestionably bring forth the kinds of comments that you seek to avoid, so in the future, it would be sensible to avoid spotlighting global warming denialists proselytizing BAU fossil solutions if you don't want hundreds of comments questioning such a 'solution'.
Yes, Gail, it is your chosen area of discussion, in the case of this keypost. If you publish work advocating coal-to-liquids, you're asking to have climate change brought up. Expecting that it won't be brought up is unrealistic.
Either TOD is a place where you don't want to discuss climate change, or it is a place where you won't invite such discussion by putting up posts like this one. You can't have it both ways, if TOD is to remain a place of free and open discussion. Of course, you deleted my other comment, so I gather that free and open discussion is the least important thing here.
Would you please provide some substantiation on your claim that China is, or is close to, producing 600,000 bopd per day of CTL.
I am open to evaluating any technology option, but have seen these claims for CTL and second generation bio fuels floating around for years, so am a bit of a skeptic.
I also see a lot of investment pitch ideas like this and have a few red flags on yours. First, the presentation is very strong - except for the parts on CTL. You also throw out numbers like a 25% IRR, but don't tell us any of your major assumptions. I'm guessing you are projecting fuel prices miles above futures rates.
In any case, saying you will get a 25% IRR is like me saying I will get a million dollars next year, it is followed by an "if". And we can judge the proposition if we don't know what the if is.
I'd take you a lot more seriously if you could give me at very least a P&L with basic assumptions (coal costs, fuel sales price forecast, maybe some evidence that the capital expense levels you plan are consistent with similar production levels elsewhere). How about at least telling me how you forecast coal and oil prices for the life of the project?
I spend a lot of time working in the energy sector in Indonesia, and don't hear a lot of people taking CTLs to seriously. But if you give me some more convincing data, I'll take a better look next time.
I think that is a good question to ask. Sometimes posts like these can elicit comments by knowledgeable people on what real costs are, in different locations.
This PDF from 2008 talks about seven demonstration plants being developed in western China, as well as one commercial 24,000 BPD plant.
Interesting claims:
No mention how much CO2 sequestered ?
You are missing the all important point:
3) Climate change coupled with fossil fuel decline and growing population precipitate agricultural collapse and famines. As a result demand drops much faster than supply.
Human idiocy may know no bounds, but nature will impose harsh constraints.
Coal to liquids are a cruel hoax. In the early 80´s I worked at Air Products and Chemicals when they were finishing up research into Coal to liquids. Yes, it can be done but the environmental costs which never show up on anyones balance sheet where very high. Of the 10 to 20 members of that research group two were dead of cancer from exposure to the solvents and process liquids within 5 years of closing. This is a dirty, dangerous technology, probably worse than tar sands.
If you Aussies out there like to broil in lengthy summer droughts and have a poisoned environment then by all means go for it.
If Australia heads down the Fischer Tropsch road at all it should be with Gas to Liquids, not Coal To Liquids, because it is cleaner and the EROI is better. However knowing the Australian propensity to live only for tomorrow I very much doubt anything will be done other than more frenetic road building; and we will have to suffer the consequences when they hit us full in the face. The politicians will then be mightily surprised (or feign surprise - how do they get away with it?) and most likely be in denial too. What a bunch of mental midgets.
I think the problem is that there is not enough gas, and what gas there is is needed for wind and solar balancing, at least in quite a bit of the world.
Contracts in the LNG market are being done at the oil price. So gas to liquids is out.
This is a fairly serious blog, although it appears Gail hasn't briefed you.
You claim the LNG is being done at the oil price is somewhere between nonsense and to vague to mean anything. How about a link and some facts.
You really are going to have to use some data soon.
I'm going to go a step further. I contend that the total number of commercial scale LNG transactions at BTU parity with oil is zero. Never happened, never will.
Natural gas is so cheap compared to oil, it would be hard to believe that LNG would trade at parity with oil. It shouldn't be hard to find some real prices.
David claimed parity; I called him on it; and he seems to have cut and run.
He is in Australia. It is something like 1:00am. So he likely went to bed.
That's fair. Let's see if he answers tomorrow.
And if he convinces me that LNG is selling at a nine dollar premium to Henry Hub, it'll be worth the wait.
I did run the numbers on this recently, although at a very basic level. The concept is that that stranded gas is worth less then piped gas and conversion and transportation costs seem to be under $4. Henry Hub is under $5. Thailand is probably paying an average of 10-15% above that at the moment. I have heard that power plants in the Philippines pay among the highest prices in the world, and that is $8/mmbtu at gate. At $80/bbl oil is about $13/mmbtu.
You'd need gas prices to double and oil to stay unchanged to get close.
Want to see LNG being price at energy parity with oil? http://www.santos.com/library/040310_Santos_Investor_Presentation_Delive...
Go to this Santos presentation dated 4th March 2010, page 6, slide 11.
David asked me to help him post this slide from the presentation above:
Santos is selling LNG, so no surprise that they are optimistic.
But Thailand's PTT seems to be able to buy it at $7/mmbtu, or near half the price of BTUs in oil.
http://www.bangkokpost.com/business/economics/184521/ptt-seeks-to-pool-o...
Your Henry Hub focus is myopic. Look at the international export/import markets.
Did you read the post you commented on? Thailand is importing LNG and is not in the U.S.
Couldn't find a chart for Australia, but Europe looks to be about $11 / Mbtu. Same for Japan LNG.
http://www.mongabay.com/images/commodities/charts/chart-ngeu.html
http://www.mongabay.com/images/commodities/charts/chart-lng.html
That is very interesting. Thanks.
I suspect that is a spot market chart. Virtually all LNG, as far as I know, is sold on long term contracts.
Here are reports of spot sales at half that price.
I have to think the figures in your chart are pre-tax, so that's not likely to be the issue.
It is a new market, so data may be odd. I'm not an expert, but would be interested to learn more. I am sure LNG can't sell anywhere near oil on a BTU basis in a real market over time.
In 2008 when oil got to $148 per barrel, a spot cargo of LNG was sold at $20/gj. The other thing that will keep LNG at oil parity is that CNG is substitutable for liquid fuels in a lot of transport applications. 70% of the LNG sold into north Asia goes to power generation at the moment. Over time that will be displaced by nuclear and the gas will go to transport, filling a vacuum left by oil.
Over time that will be displaced by nuclear and the gas will go to transport, filling a vacuum left by oil.
Two thoughts:
1) I hope you're right that forms of energy consumption will migrate fairly seamlessly away from oil.
2) EVs will also help.
Saildog
There is a company working on a combination of both GTL and CTL, by firstly under ground gasification. which is similar to the Toe to heel (THAI)process being tried in Canada.
The company is Linc Energy
www.lincenergy.com.au
They plan to turn coal to gas then to oil, they currently have a test plant in Queensland producing diesal and working on Jet A1 for aircraft. The advantage is a lot of the CO2 is left underground and no mining cost (money and fuel) are incured.
More importantly, in 2008 LINC projected producing syncrude via underground coal gasification at less than $30/bbl.
First, the 'trillion' tons of Chinese coal(which the Chinese gov't is telling its own people) is wrong.
Australia consumes 1 mpd of oil(50% imported) and 150 million tons per year of coal. If all that oil were Fischer Tropsch liquids Austrailia would no longer export coal as it would take about 400 million tons of coal per year and it only mines 429 million tons per year(2008).
USGS says Australians reserves are ~80 billion tons.
http://www.eia.doe.gov/country/country_energy_data.cfm?fips=AS
So the Island Continent could keep driving cars for 200 years(and screw the rest of the world).
Thorium reactors?! Poor thorium--reduced to the 'fool's gold' of nuclear power( you usually need uranium or plutonium made from uranium to breed it).
Reduced by whom? Thorium is no more "fool's gold" than Uranium 238.
Yes, thorium reactors require a small "starter" amount of U235 or Plutonium. Once neutrons are initiated, Thorium readily breeds large amounts of fissile U233. Like U238 (which is 99.3% of natural Uranium) Thorium is not directly "fissile". But also like U238, Thorium is quite "fertile".
Thorium can also be "burned" by adding it to existing uranium reactors. And Thorium is about 4 times more abundant in Earth's crust than Uranium.
Who needs thorium if you have mountains of depleted uranium?
The difference is U-233 is more radioactive and therefore more resistant to proliferation.
The small amount of U-235/Pu-239 starter is around 20% which is a lot.
If the LIFE fusion breeder reactor works we have fuel for thousands of years but renewables would still be cleaner/better.
1) If the economics are as good as Archibald says they are, the industry shouldn't need extra tax breaks. That would just lead to excessive CTL investment.
2) The other alternative for a country with lots of coal is CO2 capture and injection, combined with a conversion to electric transportation. I would like to see a side to side comparison of the two alternatives.
1) If the economics are as good as Archibald says they are, the industry shouldn't need extra tax breaks. That would just lead to excessive CTL investment.
Bing! We have a winner. Either the technology is profitable as is, or it needs government handouts to survive. You can't have it both ways.
Government does have a job to play in the energy game: it can fund research into basic enabling technologies (say, making solar cells that don't suck), and it can solve capital shortages for small-scale projects (say, a homeowner who can't afford $5K to insulate his house.)
But government has no business getting involved in large-scale projects where the technology already exists, risk is low, and capital is not a barrier. If it's a good investment, it doesn't need government help. If it's a bad investment, it shouldn't get government help. This applies to coal conversion plants, wind farms, nuke plants, shopping malls and sports stadiums.
My comment exactly. If the economics are comparable to deepwater drilling and oil sands production, why aren't there many more of these plants in operation?
If you remember the Hirsch Report, it talks about scaling up CTL in response to oil shortages, as one of the types of mitigation that might be planned with a 20 year time frame.
I was just now looking to see if there were cost estimates included, but I didn't see any. The fact the some CTL plants are being built around the world tells a person that the costs are likely not too terrible. But I expect that it is hard to anticipate everything, and the costs, at least initially would be higher than expected.
There are likely to need to be infrastructure changes too - new coal production, with new roads to it, for example, and ways of transporting the liquid that is made. All this adds in one way or another to the total costs of the project. If it were a "mature industry", it could piggy-back on built infrastructure.
Regarding why there aren't more, there is a lot of lead time, in anything like this. So the costs being contemplated in something that is being brought on line now, is likely investments being brought on line based on oil prices in the 2004-2005 period.
Ah, but are any actually being built?
I just see stuff like this:
http://english.indonesiaheadlines.com/index.php?id=274312
http://news.mining.com/2010/09/17/sasol-may-cancel-10b-ctl-project-in-in...
http://www.upstreamonline.com/live/article227158.ece
But if you go back to 2006-7 they were pretty positive. Just like the biomass to liquids discussed below.
This train ain't leaving the station without us.
I ran across this article (behind a paywall, but type in title)
Black Gold: China Joins the Coal-to-Liquids Club
This is a story dated today, September 30 about a West Virginia plant that says:
Coal-to-Liquid Plant May Come to Weirton
This is another story, dated today:
Shenhua to join Russian Power Company in building CTL plant
So the way I read the above article (I left out some), there is now a plan to build a second CTL plant. The first one became operational in May.
This is an Australian project, with a story from earlier in September:
New Hope unveils coal to liquids project
So something is happening, but it may not be a lot.
While the author's views on climate change are unfortunate to say the lkeast, they are not DIRECTLY relevant to a technical discussion of the coal to liquids industry.
Discussion of "What we can do" in this respect needs to be mostly seperated from discussion of "What we should do " simply for purposes of clarity and convenience in such a short piece and in a discussion that will last for only a day or two while this thread is open.Otherwise what we can learn ABOUT the technology will be lost in the noise concerning what we should do WITH the technology.
I go back to a lot of older threads and although comments can usually be posted for five days at least, the dearth of new comments after two days indicates that the audience has usually moved on.
I personally have up until recently assumed that coal to liquid was simply uneconomic at prevailing oil and coal prices, but this piece has opened my eyes to the possibility that this is no longer true.
Whether this is or is not true has simply staggering implications in respect to every major aspect of modern life and the future course of civilization for at least the next fifty to one hundred years.
ACC is undoubtedly a 900 pound gorilla already waving his paws and thumping his chest at the edge of the world stage.
ACC is and remains a long term problem that NEEDS to be dealt with immediately but one that can be and is being mostly ignored in the face of equally intractable problems that simply MUST BE dealt with immediately, such as a possible economic collapse which might lead to WWIII or worse.
If coal to liquids turns out to be economically feasible on the grand scale, my personal estimate is that the pressure to adopt this technology on the same grand scale will be irresistable.
Our best hope, from an environmental pov, is that such liquid fuels remain so costly as to force us to move to an economy based on rail and electrified highway transport.
Since I know nothing about coal to liquids from a professional pov, I hope all the engineering types here have a lot to say today about the costs and scalability of the industry .
While I usually agree with your positions, OFM, I must point out that there's an error in the above statement. This entire article is merely a poorly disguised attack on the carbon tax concept, eg. "withdraw the carbon tax and we can make you independent of the world petroleum market". Nonsense.
1) No country with a source of petroleum can be independent of the world import \ export petroleum market without export restrictions. Where's the author's discussion of export restrictions to "guarantee" Ausi voters of ample affordable petroleum supplies even when China and Japan etc. are willing to pay very high prices to import petroleum?
2) How sure is the author that the world market price for petroleum available for import to Australia will always support the costs of CTL? What amount is the "risk premium" investors will demand to cover the possibility that a) Iraq might soon be capable of exporting 12 mmbpd outside of OPEC controls? EnergyPulse.net - Some Aspects of Iraq and Oil 9.30.10 Ferdinand E. Banks, Professor b) no low-investment environmentally benign rapidly scaleable method of producing Canada's oil sands could happen? (Toe-to-Heel Air Injection (THAI) -
) c) no cost-competitive system of electric power storage might com along to make IC engines obsolete? d) the world market for petroleum might collapse for macro-economic reasons?
3) several others.
Some of the comments on this have been ridiculous. Of course CTL will be developed if/when it is economic to do so. The question is whether governments will agree to price in the environmental externalities. So far there is little sign that they will: Canute-like moral posturing of middle class car users on TOD is unlikely to change this. And I doubt the capital cost will be as much as proposed - Germany scaled it up very quickly during WW2 on a background of terrible economic conditions.
South Africa survived the international embargo by Sasol producing coal to liquids. Existential threats trump all. Faced with shutting down the economy with consequent loss of pensions, I project most people will vote for developing coal to liquids along with every other fuel that can be made. The difficulty is that the Hirsch Report shows that we are already 20 years too late in getting started. Consequently we are facing a very severe economic downturn until we wake up in a frantic scramble to develop alternative fuels.
The Australian situation is an intriguing one.
No continent is more exposed to the negative consequences of global
warming, already being experienced there in spades.
By continuing their large exports of coal to Asian countries, not to mention
a love affair with inefficient automobiles, they are cannibalizing the
climate on which Oz life depends.
Meanwhile, they are also exporting the bulk of their fairly large reserves
of offshore gas, and stinting on the development of their world class solar
resource, thus gradually working themselves into a cul-de-sac.
Coal to liquids...with lignite?!
It will be proposed, but why not just slit your wrists?
The article is just another attempt at BAU at all cost.
Keep the destructive suburban, congested cities and car culture alive no matter what the cost.
Australia should plan on energy and economic powerdown and switch to its abundant renewable sources.
But of course it won't and Archibald's thinking will mean every lump of coal will be burnt and damn the consequences.
Every day we move closer and closer to collapse. Denial on the limits to growth on the one hand and do what ever is possible to maintain destructive BAU on the other.
The entire CTL concept is completely unsustainable and only adds to the looming mix of crises of a planet in serious overshoot.
I have been looking into coal-to-liquids for a wee while now, and from my limited research it looks like there is going to be lots more of it in the future. As far as I can see, this is both a good and a bad thing. Bad - seriously bad, in terms of CO2 emissions. Good, in terms of liquid fuels, available when we are likely to be running a bit short of them. The way to avoid the bad, and to maximise the good, would be to capture the CO2. you cant really do this at the individual car level, but (from what i remember) about 80% of the CO2 emissions associated with CTL occurs during the processing - the actual fuel produced is fairly normal in terms of CO2 emissions, and very low in terms of sulphur etc. Also, the flow of CO2 from a CTL plant should be fairly pure and concentrated, so it should be easier to capture. So if carbon capture and storage is developed to a working, effective and (ideally cheap) stage, then CTL could really help get us out of the jam (or, move that jam a few years/decades into the future). incidentally, there is a planned CTL with experimental carbon capture that is meant to be happening somewhere in australia - i forget the details at the moment but will post when I get the chance (likely to be tomorrow)
Another interesting development in this field is that of biomass to liquids. some companies planning CTL are stating they can mix biomass with the coal. this would reduce the environmental impact somewhat (read minimally), but would be good for their image. other companies are working hard on straight biomass to liquid fuels, a canadian company has a process to gasifiy woodchip, resulting in a tarry goo. from what i understand they plan on converting this goo into some sort of diesel equivalent. at the moment it is apparently good enough to burn in fairly sturdy boilers, possibly big engines also.
I suspect the Canadian company is Dynamotive. I've seen pitches for their technologies in Asia and Australia too. They are lot lot like this CTL one.
Here's the website:
http://www.dynamotive.com/
Poke around in their disclosures to the stock exchange. The equipment doesn't seem to work very well and almost all of their revenues are from licensing the technology to other people.
One good thing about publicly listed companies is that they do have to reveal a lot more than privately held firms.
You can do GTL, CTL you could do gas to liquids and back to gas if you wanted. The problem is no one has ever made any money doing any of it.
There is almost no first mover advantage in these technologies, so no rush. Let China make them work first. No loss.
If there is any chance they will really be viable, it will occur in a place where oil prices are not subsidized, alternatives are subsidized, capital costs are low, and regulatory barriers aren't a problem. In that regard, Australia would probably make more sense than Indonesia.
Dynamotive doesn't appear to have filed quarterly financial statements since 3Q09.
But that was where I saw the problems I mentioned above.
http://www.dynamotive.com/investors/
http://www.dynamotive.com/assets/reports/09/Q3-09.pdf
Look at the P&L, Cash flow statement and notes on revenues and plant operations.
Jack, does SASOL make money in South Africa with Coal to Liquids? Or is it heavily subsidized?
I don't know much about it. The business started in SA because of sanctions, so at the onset it was effectively the beneficiary of a heavy effective subsidy. That's why SA is the one with the technology.
Of course, SA has already lived through their Fuel Shortage problem, so we can learn a lot from them.
I see they just recently, got to 'passenger test' 100% synth jet fuel, up from a 50% blend that has been approved there for years.
I've never looked at Coal to Liquids. But I wonder, would Australia do better if it encourages the use of hybrid vehicles, natural gas powered vehicles, and/or those super efficient diesel engines? Later, the coal could be used to generate electricity and the CO2 reinjected into the ground. I did notice some of the slides were showing very juicy oil price forecasts. I don't think that's going to happen, because I bet at $150 a barrel I can figure out how to put grass clippings into a syngas gizmo and make syndiesel.
Here we go with another shell game. Not enough oil, use coal to make oil. Yet many are saying we are nearing Peak Coal. Even if that is some decades away, IF you start using it for things beyond what it is used today then you make Peak Coal all that much nearer. See http://www.energybulletin.net/node/51313 for a review of Richard Heinberg's book on the subject.
But hey we still have some beautiful Appalachian Mountains that we can blow the tops off. After all a few more years of the lifestyle we now have (a lifestyle precious few humans past and even present enjoy) well isn't that worth a few tops of mountains, more polluted streams etc.
Or we could try to transition back to a life that humans before us lived and we could do it starting now. The longer we put it off the harder it is going to be and the more trashed planet earth will be. Does not the future of the human race count in any equation?
Yet many are saying we are nearing Peak Coal
We are not.
For oil, world reserves-to-production ratio (loosely related to the amount of time our current reserves will last if we don't make new discoveries) is 32 years. There's a lot of debate on both current reserves, future production, and the rate of new discoveries here on The Oil Drum, but however you do the math this figure is on the order of decades.
Global reserves-to-production ratio for coal is 1300 years.
There is so much more coal out there in the world compared to oil, it's not even funny.
http://www.eia.doe.gov/
IF you start using it for things beyond what it is used today then you make Peak Coal all that much nearer.
True, but even if replacing 100% of oil use with coal liquids required a 5-10x increase in coal production, the RP ratio for coal would still be several centuries.
The problem with coal-to-liquids isn't running out of coal: it's the potential climate change consequences.
Global reserves-to-production ratio for coal is 1300 years.
I don't think many here at TOD take those numbers at face value. Even the National Academy of Sciences say that the US projections are vastly out of date at best, worthless at worst.
Coal: Research and Development to Support National Energy Policy (2007) - US National Academy of Sciences
Projections by the IEA and EIA are always viewed with a high degree of skepticism here.
Unfortunately, the current estimates of US coal resources are very likely far too low.
Alaska may have 5T tons. It would be more expensive to mine, but certainly affordable.
We're going to have to kill FF consumption, not rely on it quietly expiring.
Unfortunately, the current estimates of US coal resources are very likely far too low.
Umm....should we take your hunch for it over the findings of the National Academy of Sciences?
Look closely at their language:
"Despite significant uncertainties... it is not possible to confirm...there is great uncertainty"
Their point: it would be nice to know more about our reserves.
I agree.
That's a far cry from stating emphatically that coal reserves are underestimated.
http://www.theoildrum.com/node/5122
That's a far cry from stating emphatically that coal reserves are underestimated.
I agree. I'm not saying that the NAS study says that. Still, I think it's clearly true.
If you read the TOD article you linked, you see the important phrase "recoverable under "current technological and economic circumstances"". The article clarifies that if coal prices go up relatively modestly, then the coal reserve rises dramatically.
This is a basic problem with many recent survey articles about coal reserves: they neglect to notice that recent reductions in offical reserves are not due to a discovery that there is less coal in the ground. Instead, these reserves have been reduced to a recognition of reduced demand for the coal, as well as increased environmental and social problems involved mining the coal.
Unfortunately, we have enormous amounts of burnables. We will have to make a conscious choice to leave them in the ground.
Fortunately, I think this is both possible and likely. For instance, coal consumption in the US dropped sharply last year due to a combination of reduced electrical demand and increased wind and gas generation.
The NAS also says that the methodology of the analysis are out-of-date which almost certainly means that newer technologies will be able to extract more coal less expensively. This is why reserve growth has occured in the oil industry for example.
One of the problem with some Peak Oilers is that they
refuse to acknowledge that technology makes a big difference even though it may not 'rescue' us.
Why don't you list the many fancy technological improvements for coal extraction?
How has the strip and shaft mining changed in the last 30 years?
Don't mix oil and coal.
The only technology required to vastly increase coal reserve figures everywhere is some means of exploiting poor quality coal seams which are too deeply laid for open-cast mining. It already is in testing, in-situ gassification can reach very deeply laid coal seams cheaply enough to exploit even very poor quality resources. It's already been tested in Australia, underway in Alberta, Canada and some company in Montreal Canada also involved. The syngas produced (very cheaply) would be perfect for directly firing electric generators, and for conversion to liquid in CTL operation.
Alberta continues to explore cleaner energy from coal - Clean gas produced more than 1000 metres below earth's surface
With that in place, N America's coal reserves will go to practically unlimited. Nearly half the entire HUGE province of Alberta, Canada is underlain by up to 5 separate deep coal seams, too deep to mine but.... The size of it is mind-boggling, dwarfs any other N. American resource.
A scary map of coal resources worldwide potentially exploitable with UCG Note that huge extension of the Wyoming coalfields north into Canada. Of course with UCG there is no reason for the US to look north any longer....
Which one of the many threads on the cite gives the numbers you quote. Based on http://www.eia.doe.gov/energyexplained/index.cfm?page=coal_reserves it looks like your numbers may be 5 to 10 times too optimistic about coal reserves.
“Based on U.S. coal consumption for 2008, the U.S. recoverable coal reserves represent enough coal to last 234 years. However, EIA projects in the most recent Annual Energy Outlook (April 2009) that U.S. coal consumption will increase at about 0.6% per year for the period 2007-2030. If that growth rate continues into the future, U.S. recoverable coal reserves would be exhausted in about 146 years if no new reserves are added.”
If the increase in consumption were higher yet, the recoverable reserves would be depleted more rapidly. It would, in fact, appear that EIA has not taken peak oil and the replacement of oil with coal into account.
Aw, blast. My numbers are computed from world production/reserves data here, but you're right, I dropped a decimal point in the calculation. Actual RP ratios are about 125 years for coal vs 31 years for oil.
This significantly weakens my argument, but the data still supports my basic point, that the "peak coal crisis" is much further in the future than peak oil.
Another poster pointed out that many at TOD don't believe EIA figures: I understand that, but my point was regarding the *relative* imminence of peak coal vs peak oil. Even if the EIA is biased, you can still conclude that coal reserves are in better shape than oil unless you believe the EIA's estimates are 4 times worse for coal than they are for oil. Personally I doubt they're that lopsided, but I felt more confident saying that when I had an extra order of magnitude of leeway...
Actual RP ratios are about 125 years for coal vs 31 years for oil.
Anytime RP ratios are as high as 125 years you can be sure that they're not meaningful.
Corporations don't invest in exploration, or proving of reserves, when their RP ratio is anywhere near that high. They don't need to, and it would be a waste of shareholder money.
Corporations don't invest in exploration, or proving of reserves, when their RP ratio is anywhere near that high.
If coal is so abundant that nobody can be bothered to look for more, or even to count up how much they've got, that's a pretty good sign that we're nowhere near Peak Coal.
Exactly.
Sadly, we have a super-abundance of things to burn. For instance, what we call "oil-shale" is miserable as a source of liquid fuel, but it burns for electricity quite easily.
125 years for coal is 125 years with coal being used as it is now. Now if you start using it for fueling vehicles it is no longer 125 years. That is what I meant by a shell game. Everytime you substitute another fossil fuel for oil you have to reduce the time that that fuel lasts.
Similarly if you start using electricity for cars you have to produce more electricity than you are now producing. If you do that from coal or natural gas you have to cut the time those fuels will last (not to mention building a better grid). If you try to power vehicles from solar and wind you have to increase the amount of electricity they have to replace.
The shell game allows us to think that we can party on instead of power down.
Everytime you substitute another fossil fuel for oil you have to reduce the time that that fuel lasts.
Unless there's a lot more than 125 years worth, which is the case for coal.
If you try to power vehicles from solar and wind you have to increase the amount of electricity they have to replace.
Which isn't a big deal, because EVs don't use that much power. To power an EV for it's lifetime requires only about $2,000 of investment in wind power. A one time investment. For 25 years of power.
Not a big deal. We can do both.
Unless there's a lot more than 125 years worth, which is the case for coal.
Or unless there's a lot less than 125 years worth, which is the case for coal.
See how easy that was to say?
I sense you need more info to be convinced.
See http://energyfaq.blogspot.com/2008/06/are-we-running-out-of-coal.html
and
http://energyfaq.blogspot.com/2009/02/are-we-running-out-of-coal-part-2....
I have lots more, if you need it, like Alaska: it has 2-5 trillion tons of coal, and very likely has at least 200 billion which are "technically recoverable" (a 200 year supply for the US). And, yet, it's not being used at all right now, because it's significantly more expensive than lower-48 coal. David Rutledge agrees: http://www.theoildrum.com/node/6700/674664
I'll take the NAS study over your speculation, no offense...
Will, did you read any of the links? Did you read David Rutledge's agreement that there is a lot of coal in Alaska?
I happen to appreciate DavidR's posts, though as an Electrical Engineering professor, I have to weigh the backgrounds of the authors of the NAS study in contrast to his. Why would you assume he knows more than;
Heinz H. Damberger, Illinois State Geological Survey (retired), Boulder, Colorado
Mark Davies, Rio Tinto Energy America, Gillette, Wyoming
Thomas V. Falkie, Berwind Natural Resources Corporation (retired), Newtown Square, Pennsylvania
Barbara A. Filas, Knight Piesold and Company, Denver, Colorado
Paul E. Gray, Department of Electrical Engineering and Computer Science, Massachusetts Institute of Technology, Cambridge
R. Larry Grayson, School of Mining and Metallurgy, University of Missouri, Rolla
Howard J. Herzog, Laboratory for Energy and the Environment, Massachusetts Institute of Technology, Cambridge
John N. Murphy, Department of Chemical and Petroleum Engineering, University of Pittsburgh, Pennsylvania
Dianne R. Nielson, Utah Department of Environmental Quality, Salt Lake City
Lee Saperstein, School of Mines and Metallurgy, University of Missouri- Rolla (retired), Nantucket, Massachusetts
Stanley C. Suboleski, Federal Mine Safety and Health Review Commission(retired), Midlothian, Virginia
You are welcome to your opinion, we'll just agree to disagree.
If you look at the NAS study, you'll see no mention of Alaskan coal.
Again, these people are working in a different mind set than TOD. They're assuming, for instance, that environmental regulations won't be overwhelmed by a need for additional coal to keep the lights on.
I happen to agree with them. I don't think we're going to strip mine National Parks. But, I think we need to keep in mind that we would do so to keep the lights on.
That's my basic point. Also, consider this: we often dismiss "oil shale" as a source of oil, but it's an enormous source of easily burned fuel for electrical generation. I don't think we'll need to burn it, but it's there.
Do you really disagree??
Wow,
I exchanged some ideas a few days ago with another TOD poster about how I had changed my mind about producing ANWR oil resources...he said that he felt he had to hold the line at ANWR otherwise the takers would keep on taking...I wondered to myself what else was there past ANWR (and NPR-A and off-shore oil)to take in Alaska...now I realize that a goodly portion of the state can be coal strip mines as well...
My apologies, my discussion mate appears to have the facts on his side...
Edit: I believe I was exchanging these ideas with Spring_Tides
Holding the line on ANWR is possible now when oil is still readily available on the market--while we are still relatively rich and can afford fairly tough environmental regulation of North Slope oil fields. IF Chindia really begins to outbid the US in the oil market and we still have the wherewithall ANWR will be drilled. No question about it. We probably will be a bit broker by then so the only way we will be able to afford getting that oil will be on the cheap with absolutely no other considerations except the bottom line. So the IFs about ANWR go down like this.
1. We really dont' know IF there is enough oil under it to pursue but IF there is
2. When we really get down to the point where we need it we don't know IF we will have the wherewithal to go get it, but 3. IF we can manage to get it when the chips are really down we don't know IF anyone will give a damn about what gets torn up getting it out.
So holding the line will work only under two entirely different scenarios.
1. Enough other energy sources are brought on line cheaply enough so that we will never miss what might or might not be under ANWR
2. The economic machine grinds to a halt so completely that there just isn't enough energy left to go after that oil in far, far away ANWR.
Gail is betting on the latter and Nick looks to be betting on the former. Where do you think the smart money is?
Oh point 3. above of course goes triple true for our coal.
Unless there's a lot more than 125 years worth, which is the case for coal.
Still a shell game Nick. Just which generation of humans should power down. Should we bite the bullet or should we leave it to our grandkids?
You are going to be so surprised when it all comes falling down. Much of the fossil fuels that could be gotten will not. Oh well, dream on if that makes your life more livable.
Meanwhile the disaster that is mountain top removal continues. Not that you would care.
I don't like coal. I just want us to be realistic about how much there is.
Again, we're going to have to kill coal, it's not going to go quietly.
Australian UCG Process - Underground Coal Gasification
Alberta Geological Survey - There is an additional 2 trillion tonnes of coal at depth in the Alberta Plains that may be suited for coal bed methane (CBM) exploration (Note- Any coal bed suitable for coalbed methane extraction is also available for in-situ gassification of the coal itself.)
With UGC, world coal resources are essentially unlimited. 2 trillion tons of coal in ONE CANADIAN PROVINCE should convert into approximately 5 trillion bbl liquid fuel equivalent, or a significant multiple of the total amount of oil used world-wide to date. 161 years at 85 mmbpd
Nother useful map, to give an idea of the scale of coal in Alberta
2 trillion tons of coal in ONE CANADIAN PROVINCE
I'm not going to defend or attack this number, but just to put it in perspective: 1 ppm atmospheric CO2 = 2 gigatons carbon = 8 ppm atmospheric CO2. The consumption of 2 trillion tons of coal in this one province would raise atmospheric CO2 by 1000 ppm -- or more likely half that, 500 ppm, if ocean uptake of CO2 over a century or two is considered.
That would triple preindustrial CO2 concentrations. From just *one* Canadian province.
Again, we're going to have to kill coal, it's not going to go quietly.
Agreed. People who are hoping carbon sources are sufficiently self-limiting are dreaming.
I wonder how many folks in Colorado would be OK with blowing the tops off off the Rocky Mountains in order to get cheap energy, including CTL for their SUVs?
Wait, I don't want to hear the answer....
"I wonder how many folks in Colorado would be OK with blowing the tops off off the Rocky Mountains in order to get cheap energy,"
I'll tell you anyway; if the choice is between pretty mountains or starving, the mountains are history.
Environmentalism is a rich country's luxury.
Never forget that.
Now, is the US still rich? It must be at the moment since you ask the question. How much longer will this last? The gist of opinion on this blog is not much longer.
But it's not the pretty mountains that matter. It's the CO2 dumped into the atmosphere. And the poor idiots who will be pushing atmospheric CO2 concentrations into the 1000 ppmv range are going to discover that they have much less food to eat.
People are confused about the effects of warming on precipitation. They infer, based on their unqualified intuition, that more water in the air means more rain. The problem is that the rain becomes more intermittent and when it pours it pours too much. This dynamics of precipitation can be seen on Titan, which has a total atmospheric methane vapour thickness of 10 meters compared to 1 meter of water in the Earth's atmosphere. The rains on Titan can come every few centuries and wash away the landscape.
Environmentalism is a rich country's luxury.
Never forget that.
Yes of course that is (partly) true - if you are talking about our own back yard. Not too many are concerned about how our luxury is affecting the rest of the world, although now that the effects are becoming global that is changing - somewhat.
BUT the question is even larger - we are messing with the future of the human species. The question is NOT "do people starve" but "do we continue as a species". Perhaps it is best that we do not, still most people if asked would say we should.
Something has gone absolutely screwy with our values as humans - stuff has become more important that a future for our genes. We are not programmed to protect the future beyond perhaps a generation or two, so we proceed to procreate and then deny that we should protect those genes into the far future.
http://www.guardian.co.uk/environment/2010/aug/08/pavlovsk-seed-bank-russia
Once some humans (in a Communist country no less) accepted their own starvation to save species of domestic seeds and plants for future generations. Now that seed and plant stock is considered as worthless compared to a private housing estate.
The collapse of the industrial civilization might just be the one thing that could save the human species (if it is fast and hard).
The "Binary Outcome" slide is particularly disingenuous. There are almost never only two choices, and certainly not in this case. Even if you have a lignite fetish you could consider burning it to make electricity for electric transport. Not to mention solar (I believe there are a "few" sunny areas in Australia).
The plan illustrated above in this thread should be described more aptly as nuclear power to liquids.
Carbon is just a carrier of nuclear energy. This carbon must come from somewhere. The CO2 in the air can be a source, other sources include natural gas, or biomass, or shale rock, oil sands, depleted oil wells, trash, fossil energy power plants and coal… the list goes on Ad infinitum.
Let’s put aside the global warming question; that problem can be solved by not burning coal and natural gas to produce electric power.
There are loads of petrol cars around and lots of oil wells pipe lines and refineries out there all around the world. There are a vast number of big trucks and planes to support. People don’t want to convert all that to something else. The entire world wide industrial base is predicated on oil; so oil is the appropriate interface to channel nuclear energy into the sundry national economies around the world.
Besides, saving all that global investment in equipment and manufacturing base will make a lot of people happy.
Specifically, coal to liquids can be done by developing and deploying high temperature hydrogen producing mobile reactors to extract oil from the carbon content of depleted oil wells, power plants, and existing coal mines. When the average JOE is faced with $10.00 per gallon oil prices, planes can’t fly anymore, packages and freight can’t be delivered, and so on… as peak oil sets in, nuclear power can save the day, get the big trucks on the road again, make life like it use to be, provide $3.00 gas at the pump again.
Such a reactor will be completed in 2014. It is called the Compact High Temperature reactor. This is a thorium reactor. The Indian atomic energy authority has developed it as a electric power and hydrogen source using the sulfur iodine thermal chemical cycle to produce process heat and hydrogen.
I like the plan because no carbon is trashed into the atmosphere in producing process heat and hydrogen; they are produced by using nuclear power. All of the carbon goes into the oil.
The carbon loading on the environment is small, in fact minimized and total atmospheric CO2 loading can be reduced since oil burning is not the major source of atmospheric carbon today.
Just the reduction of oil refining CO2 emissions and oil shale production will compensate for transportation carbon production.
Let nuclear power bear the burden on its broad shoulders. It’s so easy and painless. Nuclear power is the new route to wealth and riches. It will make a lot of people with imagination money beyond their wildest imaginings.
I’m sorry for all those doomers so inclined, they will be disappointed. The Cornucopians and their magical thinking will take control.
At the end of the day, peak oil just won’t happen, nuclear fuel is inevitable, humanity will survive and prosper, and the herd will be as big as ever and growing still.
I would like to see more quantative detail for the cost estimates.
The article appears a bit superficial. For instance, the US oil production figures appear to be several years out of date, and don't show the recent sharp increase (especially for "all-liquids", which is what counts in an analysis like this).
IIRC, a recent UK study proposed a carbon tax of $80/ton.
How much would that raise the cost per barrel of CTL?
Here is a calculation to determine how nuclear heat effects coal to liquid cost calculations for the Crow project. Its intent was to determine what a 30 per ton carbon sequestration cost was on the project. With nuclear heat no carbon is sent into atmosphere and no carbon sequestration cost is incurred.
The web reference data and calculation assumptions can be put into a spread sheet. Modify the approach as you desire.
Background
Montana Governor Brian Schweitzer, a proponent of coal-to-liquids projects, joined tribal leaders of the Crow Nation as well as executives from Australian-American Energy Company (AAEC) in announcing (9 August 2008) that the tribe and company have formed a partnership to move forward on a coal-to-liquid facility and a new mine to be located on the Crow Reservation in Montana. The project mine will be the first new coal mine in Montana in three decades.
The project, called Many Stars, is initially targeted to convert 38,000 tons of coal per day into 50,000 barrels per day of synthetic diesel, jet fuel and naphtha. Startup is expected in 2016. Crow Chairman Carl Venne noted that future plans with AAEC include expanding the CTL plant production capacity to 125,000 barrels per day.
With carbon sequestration, it would take 112 days for a pebble bed reactor to pay for itself. It would also save 80% of the coal used. The coal deposit will last 4 times longer if a reactor is used to produce heat and hydrogen.
Assumptions:
Reference.
http://web.mit.edu/coal/The_Future_ofCoal_Summary_Report.pdf
Excerpt:
CO2 capture and pressurization (about $25/tonne) and CO2 transportation and storage
(about $5/tonne).
Carbon sequestration cost = $30/ton of CO2
Reference.
http://www.eia.doe.gov/cneaf/coal/quarterly/co2_article/co2.html
Excerpt:
Complete combustion of 1 short ton (2,000 pounds) of this coal will generate about 5,720 pounds (2.86 short tons) of carbon dioxide.
Reference:
http://www.eia.doe.gov/cneaf/coal/quarterly/co2_article/co2.html
Assuming Sub-bituminous coal at the best case 204.3 pounds of carbon dioxide per million Btu
Reference.
http://www.epa.gov/OTAQ/climate/420f05001.htm
Excerpt:
Diesel carbon content per gallon: 2,778 grams
CO2 emissions from a gallon of diesel = 2,778 grams x 0.99 x (44/12) = 10,084 grams =
10.1 kg/gallon = 22.2 pounds/gallon
Coal consumption = 38,000 tons per day
Diesel Production = 50,000 barrels day
Reference:
http://web.mit.edu/pebble-bed/papers1_files/OilSands.pdf
$820,000,000 total reactor cost for process heat production
Tons of CO2 per day for diesel
(50,000 barrels/day) x (42 gallons/barrel) = (2,100,000 gallons/day) x (22.2 lbs CO2 /gallon) = (46,620,000 lbs/2000 lbs/ton) = 23310 tons CO2 per day
(38,000 tons/day) x (2.86 short tons CO2) = (108680 tons/day CO2) - 23310 tons CO2 per day for Diesel = 85370 tons/day CO2 = x ($85.5/ton CO2) = $7,299,135 /day sequestration coast for CO2
$820,000,000 total cost of reactor/ 7,299,135 per day sequestration coast for CO2 = 112 days pay down
Coal waste calculation
(2,100,000 gallons) (2.778 / carbon / gallon) (2.20462262 lbs/kg) = 12,861,327 lbs carbon in Diesel
/ 38000 tons(.78/ ton carbon) (2000 lbs/ton)= (59,280,000 lbs carbon in coal) =
12,861,327 / 59,280,000 = 21.7 % of the carbon in coal is used in Diesel
79.3 % of coal is wasted in heat production.
(38,000 tons/day) x (.793 coal is wasted in heat production) ($12.5 ton spot price) = $376,675 day wasted coal cost
($7,299,135 /day sequestration coast for CO2) + ($376,675 day wasted coal cost) = ($7,675,810 Total wasted coal cost)
($820,000,000 total cost of reactor) / ($7,675,810 Total wasted coal cost) = 106.83 days pay down
Total coal cost including sequestration = $7,675,810 + (38,000 tons per day) x (.217 Diesel effective factor) (12.5 ton spot price) = $103,075 = $7,778,885
Cost of Diesel per gallon without reactor = $7,778,885/2,100,000 gallons = $3.70 per gallon
Cost with reactor after pay down.
$103,075 Diesel cost from coal/2100000 gallons = $0.05 per gallon with reactor
Summary
Reactor pay down period with coal price included is = 106.83 days
Total Diesel cost including sequestration without reactor = $3.70 per gallon
Total Diesel cost excluding sequestration with reactor after pay down = $0.05 per gallon
I don't have the time to do the calculations myself.
We're assuming $30 per short ton of CO2 for sequestration?
What is the additional sequestration cost per gallon of diesel?
I could be wrong here, but I don’t think you can sequester carbon underground from the exhaust of a diesel fueled internal combustion engine in a moving vehicle.
The proposal you provided converts coal to diesel, right?
So, the original question was: how much does the cost to produce a gallon of diesel go up if the project has to pay $80 per ton of CO2 emitted?
In my example, for every ton of carbon that goes into diesel fuel, four tons are used to produce heat and hydrogen.
It is that four tons of carbon that is sent into the air without sequestration. But carbon sequestration has a cost. When CO2 is captured and sequestered underground it costs an additional $120. This cost is born by the oil company. This cost does not happen when the process heat and hydrogen comes form nuclear power.
There is a tradeoff between carbon sequestration and nuclear process heat.
I am saying that carbon sequestration costs are associated with coal that produces process heat, not the carbon that goes into the diesel fuel.
If government desires, the cost of that carbon could be imposed through the use of a carbon fuel tax. That is an arbitrary cost and politically sensitive.
You've described this as a coal-to-liquids program with a nuclear energy supplement to reduce the amount of carbon that needs to be sequestered.
But really, it's a nuclear-powered petroleum synthesis plant that happens to use a little bit of coal as a feedstock. As I read it, the majority of the primary energy is nuclear.
I hope that’s OK. The end product is still gasoline and diesel fuel but the energy that this fuel contains wouldn’t have come from an ancient sun, but from some recent light water reactor nuclear waste as transmuted into U233 via thorium fertile blanket.
I don’t understand this global warming debate here either. Nuclear power can keep farmland producing food instead of fuel. It can make steel and glass and fertilizer. It can purify water with its waste heat for the fields and cities. It can keep the tops on the mountains and most of the coal in the ground for the future; all this while keeping the climate cool.
It can keep the radiation and toxic pollution from the lake streams and oceans that coal burning brings. It can produce medicines to kill cancer and find coronary heart disease (CHD).
It has done and is doing, many of these things now and will do these things and very much more in the future if we so choose.
The Gillard government is committed to a carbon tax and has stacked a committee with politicians from the Australian Greens Party. That party will control the Senate from July 2011. They want to charge $23 for every tonne of CO2 or 2.3c per kg. Since tailpipe emissions from petrol are about 2.5 kg of CO2 per litre of petrol the price of CTL petrol must include at least 2.5 X 2.3 = 5.8c per litre of carbon tax.
That's tailpipe emissions. A similar amount of CO2 is emitted by the Fischer Tropsch plant to create the internal heat and pressure. That's great the North Dakota plant has CO2 capture and storage but for whatever reason it seems hard to replicate elsewhere. Thus without CCS the carbon tax on CTL petrol is going to be at least 11c a litre. If there was a CO2 cap instead of a tax more CTL would mean less electricity. As to the water requirements of say 4X the volume of finished fuel I think there could be problems. A discussion of desalination costs in the brown coal/lignite mining area is here.
In my opinion the answer to Australia's growing oil import dependence is a combination of EVs and NGVs. The EVs would be charged from a nuclear dominated grid, noting Australia has no commercial nuclear plants but it has the biggest uranium reserves. Gas-to-liquids GTL could be reserved for jet fuel with high speed rail taking over most distance travel. Interstate trucks could run on compressed natural gas CNG or in some cases liquid gas LNG. That may mean cutting back on gas exports and burning so much in power stations. Taking up CTL will be like eating dog food, a sure sign you've hit the bottom.
That would seem like a more straightforward option for vehicles
Australian Natural Gas - How Much Do We Have And How long Will It Last ?
Coal will become too valuable to burn in power stations when its alternate use is in Fischer-Tropsch plants. Coal for power generation will be displaced by nuclear. Not the current nuclear technology, but by thorium which avoids the waste problem. Similarly, natural gas is usable without modification as a transport fuel and most of it will end up there. On the subject of rocks to burn, rocks with a carbon content as low at 10% can be burnt in a pure oxygen environment. So one day mankind will start digging up carbonaceous shales and burning them. Nature endowed us with enough oil to get civilisation going, and enough U235 to light the nuclear fuse. If rational decisions are made, the future is pretty good.
Well hot damn the party can continue. Wow. I wonder what the EROI is for digging up rocks and trying to burn them in pure oxygen. (I think you can burn iron in pure oxygen?) You sound like some of the economics professors around here! Rational decisions would be a nice change, but I'm not sure we would agree on what those should be.
-dr
Sure you can burn iron in pure oxygen-I do it on a regular basis, and can produce burned surfaces as straight as a ruler and as smooth as a babys butt if my torch is in tip top condition.
It is unlikely in my opinion thast coal will become to valuable to burn for electricity within any time frame that means anything to me or you personally , but at some point in the relatively far distant future this might actually be the case.
Of course this belief might just be a personal prejudice on my part because I believe that if industrial civilization survives over the long term, nukes are going to be the key technology.of course some lucky longshot breakthrough in low cost renewables could prove me wrong.
David Archibald - "If rational decisions are made, the future is pretty good."
So you think that it is rational to assume infinite growth on a finite planet? Are we to assume that human population can continue forever growing? What is the limit that this nuclear dream can power 100 billion, 500 billion - where does it stop?
I cannot accept this from a person that cannot make a rational, peer reviewed science supported decision to limit CO2 emissions. If this is your idea of rationality then you are seriously out of step.
No, I don't think population should grow forever. We have water restrictions and desalination plants now in Australia, and that is Nature's signal that we are full up. We are not going to be any happier with more people in Australia or more people on the planet.
Or that we should each use less water.
Of course, domestic use is only a small part of consumption (8.8%, says the ABS. So if population doubled and our per person domestic water use remained the same, total water consumption would rise 8.8%.
Of course, we might expect that the rest of water use would go up as well, as the new Australians would demand various foods and goods and services, so the already large water consumption of agriculture and mining might go up. But large parts of our agricultural and mining production are exported anyway, we could just export less so that the total amount of water used remained the same.
Better still, agriculture and mining could consume less water. But perhaps a director of and consultant to mining companies who works for an organisation funded by mining companies would not be in favour of mining companies having to use water more efficiently...
All solutions to a replacement for liquid fuels for cars seem to be about $5,000 per vehicle, whether it is the battery for the GM Volt, the tankage for CNG vehicles or the CTL capacity to provide the liquids for one vehicle. $5,000 per vehicle is quite manageable really. $5,000 buys that ticket to eternal mobility.
And it can cure male pattern baldness and erectile dysfunction. But you have to buy now, or the Chinese will get it.
A simple search on TOD's website reveals just how many times Gail herself has discussed global warming. Below are some cases in point.
I simple took the first page of the search. Some of the above results may be comments within the thread. Others, clearly were not. (The first one, for example.)
I suggest that Gail herself do a search to see how many times she, Gail, addressed global warming. I remain dumbfounded. Clearly, TOD has reached a new level of importance. The big boys want to play in its sandbox.
Is is hobby studying how the make the climate change much faster?
His blog has him posing with Bellamy a notorious AGW denier.
The whole idea of burning up every last bit of sequestered carbon on this planet is the definition of insanity.
He is right about going to thorium and (breeder) nuclear reactors. But we should electrify transport instead of trying to prop up the internal combustion engine as some sort of cultural identity item.
I'm aware of the generally known estimates of coal reserves. I'm also aware of the apparently marginal reserves which are actually being mined in many places, which usually come to light when there is some kind of disaster.
If there is so much coal available, easy to get, why was the price of coal higher in 2009 (at the depths of the recession) than in 2005 when the economy was booming?
Personally, I regard the Chinese estimates of coal reserves in the same light as I regard Saudi estimates of oil reserves. And that's scary. China accounts for about 50% of the world's coal consumption and about 50% of world production. Even a slight drop in Chinese production could greatly increase the demand for coal in international trade. China is also the world's second largest coal importer (after Japan) already.
In 2001 China was one of the world's largest coal exporters. Export Land Model, anyone?
The Australian estimates of coal reserves are probably fairly reliable. In Slide 28 David shows a modest increase in Australian coal production, but Chinese production more than doubling in the next fifty years. With China having changed from an exporter to an importer in the last few years, does anyone really believe this will happen?
David quotes a reserves estimate for China of "1 trillion tonnes". But Energy Watch Group is estimating China will peak its coal production around 2015.
"Carbon, in fact, is a singular element: it is the only element that can bind itself in long stable chains without a great expense of energy..."
(now, speaking of the journey of a single carbon atom entrained as carbon dioxide,:) "Our atom of carbon enters a leaf, colliding with other innumerable (but here useless) molecules of nitrogen and oxygen. It adheres to a large and complicated molecule that activates it, and simultaneously receives the decisive message from the sky from a packet of solar light: in an instant, like an insect caught by a spider, it is separated from its oxygen, combined with hydrogen and (one thinks) phosphorous, and finally inserted in a chain, whether long or short does not matter, but it is the chain of life. All this happens swiftly, in silence, at the temperature and pressure of the atmosphere, and gratis: dear colleagues, when we learn to do likewise we will be s i c u t d e u s and we will have also solved the problem of hunger in the world."
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From the book "The Periodic Table" by Primo Levi
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All technology is stop-gap: it gets you from here to there, like the horse-and-carriage, until it is supplanted by something else, like the horseless carriage. Blind, unfettered capitalism, which is about capital, drove the system to, and is invested in, this configuration at this point in time. If continuing grotesque profit is available with only slight modifications to Business As Usual, then this is the path of least resistance. That alternatives may involve altering the configuration, involving hundreds of millions of people, gives such solutions popular appeal. Forget human resistance as shrieked by the intellectuals: when pacifying a populace, the first order of business is silencing them. (during Pol-Pot, wearing glasses got you shot. During the inquisition, speaking science got you boiled in tar and turpentine)The meteoric rise of fascism in America (Fascism - Wikipedia, the free encyclopedia: Fascism is a radical and authoritarian nationalist political ideology. Fascists seek to organize a nation according to corporatist* perspectives, values, ...),with the now unlimited participation of the newly, fully recognized individuals/entities that are corporations, will demonstrate this nicely. Economic cycles rebound with the novel invention or discovery of an exploitable resource.
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America has largely excused itself from the playing-field of invention and discovery by decimating** it's industrial base. Sources, facilities, and materials have largely dried-up: The last electronic parts store in the Los Angeles basin closed its doors years ago: Marvac-Dow, at Centinella and Washington, is now a cake-decorating supplies shop, and a good one. I was talking with a fellow trying to prototype a novel, low-impedance motor design. The magnetic materials needed are no longer commonly available here in America. The better, amorphous metal materials are made only in, let's say it together now, China***. The "tinkerer in their garage" is out of place, here. The intellectual child is derided.
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So enjoy whatever happens. Discuss away! ... You currently have the same right and say in it as anyone in Uganda. Might want to change that. It may otherwise give you endless entertainment sitting around the campfire picking the lice out of your snot.
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*This word is being used with a different meaning than the current American popular usage.
**Interesting word, "decimating": http://video.google.com/videoplay?docid=-1957179570191443503#
***They are installing 30,000,000,000 watts worth of metal-glass transformers, having 70% less loss than ours, a year: http://www.aepfm.org/news.php?nid=9
In support of your contention that the US has lost its innovative spark as well as its ability to effect technical solutions to global problems as follows:
TerraPower CEO John Gilleland, however, said “there’s a good chance” the company will build a test reactor overseas. He said September 21 that the NRC’s limited ability to license advanced designs like TerraPower’s traveling wave reactor is a contributing factor to the decision.
Gilleland and TerraPower’s chief investor Bill Gates visited nuclear research institutes in China and Japan last year. Gilleland called China “a nice place to look” as a potential host country for a test reactor. Nevetta said the idea of losing TerraPower to another country is “almost heresy.” “I’m offering this demonstration complex as an alternative to China,” he said.
Yes, tho a good portion of that is the usual Start-Up posturing, as they lobby for funding and partners.
From a pure experience and production flow basis, it makes sense to move this offshore.
However, is it still very much early R&D, with pilot plants a LONG way off.
TerraPower plans to have a TWR prototype built by 2020 producing electricity for the grid in the several-hundred megawatt capacity range
Yes, ausgang: "This is not the future I ordered."
http://www.nap.edu/catalog.php?record_id=12999
http://books.nap.edu/openbook.php?record_id=12999&page=6
"Reports of the death of the US have been greatly exagerated." -- from long observation by a northern neighbour.
I seem to recall EROI for CTL technology is <1 - anyone can confirm/ deny?
Given that there are no Coal Power Cars/Trucks, an academic yardstick is of little practical use. A better one is the break even cost threshold.
Totally agree with JG.
This is the small logic that keeps near exhausted oil fields in production too. As an oil field nears the end of it's life it takes more energy to pump and remove water than is contained in the recovered oil. At this stage an oil field becomes a distributed coal to oil plant, where coal is burnt at remote power station to drive the oil extraction process.