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TR: When we look at oil companies, there's a lot of entrenched positions and not much movement. That seems to be a basic institutional problem.
SK: I can only talk about one company that I know well. I've found the folks at BP eager to listen, to learn, to engage in discussions, and to try to do the best job that they can in balancing the short-term operations of the company against these longer-term things. After all, they have a business to run; they have shareholders to report to. They have a responsibility to produce [a certain percentage] of the world's oil every day, which the world needs. So it's a balancing act.
One of the things I have learned, which was surprising but makes sense in retrospect, is that companies are wonderful optimizers of their situation. If the government sets the playing rules appropriately, they will respond strongly and rapidly. So it is a question of getting the right policies in place, as well as a push from within the company.
TR: So the markets aren't going to solve these problems?
SK: Left to its own devices, the market will not price the externality of carbon dioxide, nor will it effectively deal with the security-of-supply problem. I think [that's] because it's longer term, and the markets have a shorter-term focus. I think markets are good for tactical allocation, but it's not obvious to me that they're the right thing for strategic allocation [or] longer-term planning.
TR: Are you hopeful we're going to be able to meet these challenges?
SK: I'm optimistic about security of supply. I see many sources for liquid hydrocarbons. I see great potential for efficiency improvements in U.S. transportation fleets. I am less optimistic about carbon dioxide emissions reductions. The world should give it its best shot, but there are so many forces aligned against it that I think it's going to be very difficult for the world to stabilize emissions, let alone stabilize concentrations of carbon dioxide in the atmosphere.
Carbon dioxide lives in the atmosphere for a very long time--a thousand years or so. What that means is that the atmosphere is accumulating emissions, and emissions right now are on an exponential growth path--2 or 3 percent a year. If we manage to make modest reductions in emissions, it will only be in the rate at which the concentration grows, but it won't stop the growth. So the usual societal response of dealing with a problem partially is not good enough to deal with the CO2 problem. We really need major changes in the ways we produce and use energy if we're going to prevent concentrations from rising. I don't think people understand that.
High prices still haven't prompted companies to use advanced extraction methods.
Forget ethanol: it's hard to transport and gives bad mileage per gallon. Another alcohol, butanol, is a much better renewable fuel, says the president of BP Biofuels.
Is the Anti-Coal Drumbeat Worthy?
By following the insights of Cardiff University sociologist, Harry Collins, readers will be able to decide whether or not the anti-coal drumbeat is worthy.
Is the Anti-Coal Drumbeat Worthy?
By José Antonio Vanderhorst-Silverio, Ph.D.
Systemic Consultant: Electricity
First posted in the GMH Blog, on September 26th, 2008.
Copyright © 2008 José Antonio Vanderhorst-Silverio. All rights reserved. No part of this article may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying and recording, without written permission from José Antonio Vanderhorst-Silverio. This article is an unedited, an uncorrected, draft material of The EWPC Textbook. Please write to javs@ieee.org to contact the author for any kind of engagement.
Whether he knows or not, the very intelligent, very important and well respected, Warren Causey’s is “talking the talk” in defense of the power utility and coal industries interests with his article If you want the utility industry to join the financial industry, keep up the anti-coal drumbeat!
This is part of the comment I posted September 25th, 2008, in response:
… I suggest the EWPC article "Is Gore's Revolutionary Leadership Challenge Feasible?,” whose summary reads: "Al Gore leadership challenge is based on leading expert advice. EWPC is the first holistic step ready to be implemented in an Energy Policy Act that satisfies the non-trivial power system requirements laid out by the leading experts [and] power industry insiders the late Fred C. Schweppe and Jack Casazza."
One thing that needs to become clear is that the fossil fuel "fueled" society system needs to be restructured out by opening the power industry to competition. Maybe 10 years could become 12 or 15 years transition, the whole point about EWPC is that it has a bridging function. It does that by letting generation competition work its way out, by having fossil fuels taxed in accordance with rules at the WTO. All those like Mark Gabriel and you [Causey] that feel that clean power will not make a dent should favor such free competition under in a power business without price controls.
Unlike the financial industry and deregulation, which are prone to systemic risks, EWPC has a controlled transportation market that is associated with short run and long run systemic risks. Please take a look at the article "Rethinking Electricity Restructuring as EWPC." Long run systemic risk is known in the power industry system adequacy.
End of the comment and the beginning of another comment.
In the article Strategies for the Energy Crisis, posted September 26, 2008, on Technology Review (TR), BP's chief scientist, Steven Koonin (SK), is interviewed by Kevin Bullis. Koonin says cutting greenhouse emissions will take major changes.
I infer that according to Cardiff University sociologist, Harry Collins, that SK as a leading expert and industry insider, while he cannot "walk the walk," he does a lot more than just "talk the talk," as Causey and Gabriel do, SK can "walk the talk." The difference between Causey and Gabriel on one side and SK in the other is scientific expertise. Also according to Collins Koonin can contribute, while Causey and Gabriel cannot.
To support the worth of the anti-coal drumbeat, I selected two interchanges from the interview:
TR: When you look at public policy decisions, what are some other mistakes you've seen?
SK: One is confusing transportation with stationary sources of power and heat. What problems are we trying to solve? If it's carbon dioxide emissions, there are cheaper ways to do it than improving transportation. If you improve the efficiency of a vehicle to reduce fuel use and carbon dioxide emissions, for many vehicle technologies it will take several hundred dollars per ton of carbon dioxide. But transport is only 20 percent of energy-related emissions. Heat and power from stationary sources are most of it. At $50 a ton, there's a lot of carbon that can be wrung out of stationary sources. When you start cranking the price up to $100 to $200, that's when you start to affect transport, whereas we can shift to lower-emissions heat and power at $50 a ton.
TR: Why the difference?
SK: There are about twice the emissions, per unit of useful energy, from coal as from gasoline.
Koonin concludes the interview with "We really need major changes in the ways we produce and use energy if we're going to prevent concentrations from rising. I don't think people understand that." I believe important and intelligent people don't understand it because it is a non-trivial matter, which means that they do not have the interactional expertise Koonin has to be able to walk the talk.
Koonin says "One of the things I have learned, which was surprising but makes sense in retrospect, is that companies are wonderful optimizers of their situation. If the government sets the playing rules appropriately, they will respond strongly and rapidly. So it is a question of getting the right policies in place, as well as a push from within the company."
By walking the talk, as a power utility insider and researcher, I claim that the EWPC market architecture and design paradigm will enable the mayor changes with the right Energy Policy Act for the power industry. In that respect, I suggest readers to consider my humble contributions on the EWPC Blog articles' summary EWPC Blog's First Year Anniversary: Electricity for the Digital Era.
Re: Is the Anti-Coal Drumbeat Worthy?
WOW! I lost one start; I had 4, now I have 3.
In the mean time, William Norquay posted a comment on the EWPC Blog, that he ended with "I am not anti-coal, but I am against waste and stupidity." Next is my response:
William,
I think the key issue is whether Causey, Gabriel, and SK have the required expertise on the pro-coal/anti-coal issue. To help you and other readers interested in learning if they have expertise or not, and are able to make a sensible contribition, please take a look at a question posed to Harry Collins by American Scientist Online managing editor Gress Ross in an interview by e-mail in March 2008 and Collins answer.
Question: If political decisions can't be informed by careful science, does this spell trouble for democracy as the world grows more complex?
I do not think that there has to be any trouble for democracy, but we live in dangerous times. The argument goes back at least as far as Plato's suggestion that the Republic should be controlled by "philosopher-kings." We now know that cannot work--experts are too fallible, and too much power corrupts. In the last resort, all decisions have to be made through the machinery of democratic politics if we want to preserve a society like ours.
On the other hand, it is vital to preserve the separate spheres of the technical and the political. In practice this can never be achieved, but if we don't try we will destroy the very idea of science and of expertise as a whole. I would say that the danger to democracy that my own discipline--social studies of science--is not doing enough to combat is the collapse of the idea of expertise. Current social studies of science has difficulty with the notion of expertise. The attitude that anyone's opinion on any topic is equally valuable could spread, and there are some indications, such as widespread vaccine scares, that suggest it is happening. A world in which there is said to be no difference between those who know what they are talking about and those who don't is not one that anyone who thinks about it wants. Such a society would be like one's worst nightmare, exhibiting many of the characteristics of the most vile epochs of human history.
Philosopher-king fascism won't work, but a reaction to it that creates technological populism is just as bad. It is very hard to work out how to find a rationale for a middle position which does not replace one extreme with the other. Our studies of expertise perhaps indicate how we might establish a middle view now that we know that science and technology cannot deliver the kind of certainties that politicians need at the speed that policy unfolds.
Re: Is the Anti-Coal Drumbeat Worthy?
Hi Javs,
You apparently missed this key point, which is well-documented in my report: "Because the demand for oil is so high, it will always exceed production levels; thus oil depletion will continue steadily until all recoverable oil is extracted." Thus conservation and efficiency will not do much good. I suggest that people prepare for Peak Oil impacts.
The System Needs to be Changed
Thank you Clifford,
Under today’s system, you might be right. However, Koonin concludes the interview with "We really need major changes in the ways we produce and use energy if we're going to prevent concentrations from rising. I don't think people understand that." What Koonin is effectively saying is that we need to change the system that is making "… the demand for oil is so high, it will always exceed production levels…” to prevent the concentration from rising. One way to change the system is by introducing an Energy Policy Act to implement EWPC and negotiate at the WTO an agreement to tax fossil fuels to actually reduce concentrations after a transition period, so that, for example, the demand for oil will not exceed production levels.
Re: Is the Anti-Coal Drumbeat Worthy?
yeah. sequestering the co2 from burning coal underground ought to go long way toward making coal a nonsource of CO2.
The problem is not that the market is too short term to price the CO2 problem correctly.
The issue is the "well assigned property rights" as Coase stated. Currently, when we use energy, we cause externalities on other people (Pollution, CO2, Noise, Traffic congestion) that are not properly priced because the property rights are not assigned. If we had to pay for inflicting damage on others for our energy use, it could be priced by the market.
"Social Costs" can be priced by market mechanisms, but the property rights (clean air and low carbon dioxide on this case) need to be allocated and an efficient mechanism to for charging it found.
SK said "So the usual societal response of dealing with a problem partially is not good enough to deal with the CO2 problem. We really need major changes in the ways we produce and use energy if we're going to prevent concentrations from rising."
I added "One thing that needs to become clear is that the fossil fuel "fueled" society system needs to be restructured out by opening the power industry to competition. Maybe 10 years could become 12 or 15 years transition, the whole point about EWPC is that it has a bridging function. It does that by letting generation competition work its way out, by having fossil fuels taxed in accordance with rules at the WTO."
At the end of the day, since the GHG are global, the proper place to negociate GHG taxes and reductions will be the World Trade Organization. I hope that the WTO Doha negotiations could be reopened to include GHG reductions, just as they reduce trade tariffs.
Alternative Energy sources as Supplement only.
Kevin Bullis and Jason Paton's joint effort at publishing Steven Koonin's interview on the subject of Energy Crisis is highly commendable.
Having followed Koonin's perspectives at MIT
last week, and now, aforegoing excerpts, my perceptions that as good and supportive as alternative energy research and investment
might be, and regardless of time factor, a complete successful realization alternative
energy pursuits will never amount to complete universal replacement of fossil fuels
exploration and exploitation for the
benefit of mankind and society.
Economic dynamism of changing time and
society are not perfectly predictable. Man
needs to consider societal changes and
increasing population needs, unpredictable changing behavioral pattern and impact of
decision making process on critical
matters of sensitivity, both on
national and global economies, society,
human quality life and humanity.
Lastly, multidisciplinary discussion
provide an upper hand in every sound
decision making event than
a colossal investment, improperly
justifiable,but in fulfillment of
the thinking of a selected few.
Nations must stay in constructive
engagement discussions with
OIL PRODUCING AND EXPORTING COUNTRIES
even when successful realization of
"break-through" in alternative energy
research and development is recorded,
for disengagement from needy application
of fossil fuels, or crude oil and its
derivative products seems practically
impossible, not even in the context of
short or long term consideration..
M.Atayo (Martin@mpgatechnology.com)
If this years price increase at the pump drove consumption down and helped reduce prices, then it would make sense that a controlled decrease in consumption through a major National Telecommuting Policy would do the same, but also reduce demand for other Enrergy Sources as well.
Why doesn't the US have a National Policy to make Telecommuting Mandatory? We have 150 million workers, 60 million broadband Internet connections. If weonly Telecommuted 100% of the potential users - say three days per week, the impact would be enormous!
"Why doesn't the US have a National Policy to make Telecommuting Mandatory? "
Why? Really? For one, it's not the government's place to tell every US business how to operate.
"If weonly Telecommuted 100% of the potential users - say three days per week, the impact would be enormous! "
Sure it would, if a large enough percentage of American workers are 'potential users' but how many really could work from home? Think about all the people you work with and deal with on a day to day basis in society. How many of them could do their job from home, even one day per week?
Don't get me wrong. I am a proponent of telecommuting. With time, advances in technology such as video conferencing, along with changing attitudes will increase the number of telecommuters. Certainly the next generation of workers will be more comfortable working online. Higher transportation costs and a weaker economy might get us there faster.
To imagine that a significant percentage of workers could telecommute today is naive. There are just too many people that need to be at their place of employment. Not everyone in the workplace sits in a cube with a phone and computer all day, at least not yet.
To get back to the original point - the government encouraging telecommuting would be a welcome, forward-thinking policy, requiring it would be intrusive and ineffective.
The US work force is in a position to Telecommute. Not everyone mind you can because they lack the tools, or their job doesn't allow them to do it effectivley from afar. BUT - if 100% did telecommute, it would drastically alter the prices for all other related services and create a surplus of things like excess parking, office space gluts, less gasoline consumed, open roadways that actually permit the driver to get fom point A to point B in an acceptable time. In addition we'll have a lot less pollution and green house gases to deal with! Why put CO2 in the athmosphere in the first place if you have to take it back out using some other means?
We have been issued laptops and cell phones - and lets not forget - asked to work after hours from home. So the big multi million dollar question is that WHY do we continue to have a majority of workers actually drive into the office every day?
Aside from the government wanting easy tax dollars, and corporate america turning a blind eye away from a means to reduce office and commuter costs - yet asking the same workers to put in more than 40 hrs per week (sometimes a heck of a lot more)- it makes no sense not to force the issue. Looking at the Democrats and Republican's plans for our future - doesn't include and outright conservation practices. New cars, batteries, power stuff - power plants, off shore drilling, ANWR drilling, solar, wind, CNG - hey all great stuff that will take a decade at least to develop.
If we see another jump in gas prices like last year and our pitiful pay increases don't cover the added expense, where will we (as consumers) be able to cut back? Are we willing to wait another decade?
It's about the creation of sustainable technologies, conservation of natural resources as much as its about conservation of paychecks!
Seriously, government is not needed to dictate to business a telecommute policy. Businesses in free market societies are adaptive, and when telecommuting a percentage of their work force makes business sense, they do. Telecoms would do them selfs a favor helping individual business identity and implement appropriate solutions.
You make several good points that business may consider from less office space needed, to fewer parking lots needed. Voice over ip (VOIP) is a great solution that allows for many office workers to answer calls from home, greatly reducing office space and parking lot needs, and to a lesser extend the number of commuters on the road.
Many employees would happily telecommute if given the option, as opposed to fighting traffic an hour on the road a day, gas prices, and ware and tear on vehicle.
The assumption that businesses always do the most economical thing may not be valid. Businesses seem fixated on certain means of cutting costs. Interestingly in the software industry the biggest cost cutting measure is outsourcing engineering to the poorest contries that have the necessary talent. This is "big time" telecommuting since a part of the work force is halfway around the world. So why can't the same businesses see the value of telecommuting at home and promote it?
Manufacturing in the United States is in trouble. That's bad news not just for the country's economy but for the future of innovation.
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cjwirth
2 Comments
Biofuels and solar power failures
Algal biofuels are in the R & D phase and 10 years and trillions of dollars of investement away from producing just a trickle of energy. Here is reality.
According to most independent scientific studies, global oil production will now decline from 74 million barrels per day to 60 million barrels per day by 2015. During the same time demand will increase 14%.
This is equivalent to a 33% drop in 7 years. No one can reverse this trend, nor can we conserve our way out of this catastrophe. Because the demand for oil is so high, it will always exceed production levels; thus oil depletion will continue steadily until all recoverable oil is extracted.
Alternatives will not even begin to fill the gap. And most alternatives yield electric power, but we need liquid fuels for tractors/combines, 18 wheel trucks, trains, ships, and mining equipment.
We are facing the collapse of the highways that depend on diesel trucks for maintenance of bridges, cleaning culverts to avoid road washouts, snow plowing, roadbed and surface repair. When the highways fail, so will the power grid, as highways carry the parts, transformers, steel for pylons, and high tension cables, all from far away. With the highways out, there will be no food coming in from "outside," and without the power grid virtually nothing works, including home heating, pumping of gasoline and diesel, airports, communications, and automated systems.
This is documented in a free 48 page report that can be downloaded, website posted, distributed, and emailed: http://www.peakoilassociates.com/POAnalysis.html
I used to live in NH-USA, but moved to a sustainable place. Anyone interested in relocating to a nice, pretty, sustainable area with a good climate and good soil? Email: clifford dot wirth at yahoo dot com or give me a phone call which operates here as my old USA-NH number 603-668-4207. http://survivingpeakoil.blogspot.com/
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chr4@wp.pl
1 Comment
Re: Biofuels and solar power failures
Cjwirth
I also believe that peak oil is imminent but I think the picture you are painting is too bleak. You are saying: “Alternatives will not even begin to fill the gap” & “I used to live in NH-USA, but moved to a sustainable place.” Does it mean that we should all try to find a cave with a plot of fertile land and not even be bothered with renewables because it is too late anyway? Should we watch Mad Max over and over again to learn new ways of survival?
It is true that even if western countries become serious about energy conservation growing economies of Asia will be catching up with energy consumption. Nevertheless we should still do our best.
Steven Koonin makes two important points:
1) there is a great potential for efficiency improvements in U.S. transportation fleets
2) there must be political will to keep fuel prices higher to encourage & sustain conservation
Contrary to popular belief we don’t have to wait for a breakthrough in battery technology to see the first positive results. The average fuel efficiency of cars in Europe is 30% higher than in USA. By choosing smaller vehicles or diesels instead of SUVs Americans could reduce their fuel consumption per capita by about 30 % in 15 years - and that’s with 1990’s technology. Buying hybrids would mean even bigger savings especially for city dwellers. Honda Insight which will go on sale in 2009 will be much cheaper than Prius and will easily attract hundreds of thousands buyers. Such cars would be a norm if you paid more for fuel. Don’t worry about businesses. Pizza delivery guys don’t go bankrupt in Europe even though they pay twice more for fuel. They simply drive more efficient cars.
Plug-in hybrids still have a way to go but we could go round some obstacles. Subsidising future PHEVs with $7500 is good news. But I think it would be better to offer a bit less and instead offer also tax rebates to companies installing infrastructure to recharge batteries when their employees buy PHEVs. Then most owners would be OK even with 20 miles range on electricity as they could plug it in at work. As the cost goes down more batteries could be added to next models. High oil prices also mean that some companies move manufacturing from China back to the west as the costs of shipping outweigh the savings in labour. Less shipping means lower oil consumption. As someone said: "nothing cures high prices like high prices" (http://www.guardian.co.uk/business/2008/sep/06/oil.oilandgascompanies) .Higher costs might force us to reduce our holiday travel but at the moment I can’t envision food & fertiliser shortages due to lack of oil or natural gas. You don’t have to learn to grow your own carrot just yet.
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protn7
72 Comments
Re: Biofuels and solar power failures
Solar thermal power systems are multiplying as the worldwide oil shortage and greenhouse warming cause fossil fuel based energy sources to hit price levels without precedent. Solar thermal is already cost competitive with conventional sources of electricity in certain places such as southern California and Vulvox has designed a combination solar thermal-photovoltaic system that will produce a much larger amount of electricity from the same size solar power plants. The result- lower generating costs, more efficient use of land, and the opportunity to replace parabolic troughs in existing solar plants with our dual generating parabolic troughs at less cost than building entirely new plants.
There are times when the sun is too strong and excess power that could be generated would overtax the turbine systems. Solar thermal utilities have to aim their solar reflectors away from the power towers to cool them, wasting solar energy and lowering efficiency.
The Vulvox solar system will have a photoelectric component that will keep on generating electricity and it will be fed into the grid, even if the collectors are aimed in another direction and the power towers are cooled.
The Vulvox solar system will generate higher power levels than competing solar power towers, while retaining all of the storage capabilities of solar thermal power.
http://vulvox.tripod.com/id18.html
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