Wednesday, January 13, 2010

Is an energy solution for the country staring us right in the face?

This past year, based upon the latest estimation on the amount of recoverable natural gas in shale formations, natural gas reserves have jumped significantly to more than 2,000 trillion cubic feet. To put this in perspective, this amount of natural gas would be able to fuel five hundred 1,000 MW power plants for their entire 50 year lifetime! The advantages associated with natural gas fuel usage in power plants are many. First, the cost of these power plants is less than half that of coal-fired plants. Second, they can be built much quicker. Third, and most important in this time of concern about greenhouse gases and climate change, they would emit almost half the greenhouse gases for the same amount of power generation.
In my opinion, the energy solution is staring us right in the face. Clearly, U.S. energy policy first and foremost should seek to maximize energy conservation and efficiency efforts wherever it makes economic sense to do so. Americans clearly waste far too much energy and this must cease. Second, the U.S. must reduce its reliance on foreign oil imports, particularly from countries that have the capability to hold the country hostage. The U.S. today imports about 10 million barrels per day, of which approximately 30% comes from the Persian Gulf region and Venezuela. Much of this oil is used to fuel the nation's 250 million cars, trucks and buses. Third, greenhouse gas emissions need to be reduced to the maximum extent reasonably possible. As part of the global community, the U.S. has a responsibility to take a leadership role in responding to climate change and the international efforts directed at reducing carbon emissions.
These three goals could be achieved using a rather obvious three-pronged strategy. First, and most important, would be for government regulators to vigorously promote energy conservation and energy efficiency. Fortunately, this is already underway. The second prong would involve the aggressive transition to a nuclear energy-based economy for base-load power generation using advanced technology that would minimize the amount of nuclear waste generated. Unfortunately, this would take considerable time, estimated at upwards of 40 to 50 years. Therefore, we would need to do something in the transition. This is where the third prong comes into play. In the transition, it would make sense to require all new and replacement power plants to be combined-cycle natural gas-fired plants. Some utilities have already committed to this path. Florida Power and Light (FPL), for example, has already converted its older oil-fired power plants, such as the Fort Meyers and Sanford plants, to more efficient natural gas combined-cycle technology. Three new power plants, West County Units 1, 2 and 3 in Palm Beach County will also use this technology. In the transition to nuclear, we would also want to expand at coal-fired power plants the role of peaking units, most of which are fired by natural gas. It has been estimated that these units could meet as much as 40% of the country's electricity need if they were used to replace coal-fired baseload capacity. It also would make sense in the transition to encourage and expand the use of natural gas and electric powered vehicles. Already, a number of states and government agencies are promoting their use, as are a number of utilities such as AT&T, which actually has the largest fleet in the country running on compressed natural gas. Finally, the use of renewable energy sources such as wind and solar should also be promoted and encouraged in the transition (as they currently are today); however, these are not expected to be significant contributors to the energy solution, and their economic viability without government incentives is already being questioned. The advantage of this three-pronged strategy is that the by-product would be greatly reduced greenhouse gas emissions.
Alas, and unfortunately there are a number of forces working against this rather obvious energy solution. There is the political influence generated by coal-producing states and the unions representing coal miners, who would most certainly fight aggressively against any reduction in the use of coal. Their argument usually focuses on the hugh amount of coal we have in this country (more than 500 billion tons of proven reserves, with only about 1.1 billion tons extracted annually, most of which goes to produce electricity) and the fact that technology is being developed that can significantly reduce greenhouse gas emissions at coal-fired power plants (albeit, at the expense of plant efficiency). Moreover, the technology would be much more difficult to use at natural gas-fired power plants (because of the much lower carbon dioxide concentration in the flue gas) and it is therefore unlikely the technology would ever be used there. Hence, the argument can be made that in the long run coal-fired power plants with carbon dioxide emission control systems would actually produce less carbon dioxide than the uncontrolled natural gas-fired power plants.
Then there are the environmental activists who have long fought against the use of nuclear energy, and who are now fighting the development of natural gas shale-producing formations, expressing concerns about possible groundwater contamination from the chemicals used to hydraulically fracture the shale. Extracting natural gas from shale formations involves blasting water (more than 98%) mixed with chemicals (less than 2%) into rock at high pressure, which causes the gas to flow out. In my view, the concern about groundwater contamination is difficult to understand. Shale gas formations typically are deeper than coal bed methane formations and have not traditionally been identified as sources for supplying drinking water, and are often geologically isolated from drinking water aquifers by several thousand feet of other strata including other shale formations that act as aquitards. Shale is a natural barrier to the vertical migration of fluids and is documented as confining layers to vertical migration of oil and gas. As such, the natural barriers between productive shale formations and groundwater zones should be able to ensure that groundwater resources are protected. Also, not much is being said by these environmentalists about the pollution associated with extracting gas from shale formations compared to mining coal. There can be little doubt that extracting gas from shale formations would be considerably more environmentally friendly than mining coal.
Notwithstanding, it is unlikely that the present financial, political and economic climate will be conducive to development of a coordinated and integrated national energy strategy. Policymakers and regulators will certainly face many challenging decisions as our economy is realigned to meet whatever energy and environmental goals are ultimately put into place. But as is so often the case with government legislation and politics, things will likely be done in a piecemeal fashion resulting in a considerable amount of waste in time and money. It reminds me of the words Winston Churchill once said, "you can always count on Americans to do the right thing, but only after they have exhausted all the possibilities." But then again, as that famous New York Yankee Yogi Berra once said, "if the world was perfect, it wouldn't be."


Mark said...

Well said, Tony. Please keep it up.

ronz said...

Please explain how a natural resource can make a 'significant jump' in avaiability.
The people's concerns over extraction is caused by previously contaiminated ground water.
It does not take much natural gas to contaminate drinking water.

dylang said...

i think your idea is a great current solution, but it will be dated in 10 years and it is not a solution for the next 50 years. we want to be self-sufficient, but we also want to wean ourselves off fossil fuel, not just shift our reliance from one to the other. nuclear and natural gas should be part of a temporary solution that transitions our energy base from fossil fuel to renewables.

i question your dismal of renewables as a feasible energy option. this report contradicts your claims...

Diana said...

Tony, thank you for providing this information. I struggle to stay abreast of all of the knowledge that is out there and you always help summarize it!

Tony said...

Dylang, the solution suggested will not be dated in 10 years. The long term portion of the solution suggested is a move to nuclear energy, a move that will take at least 30-50 years. As we move further to nuclear, there will be substantial shift away from our dependence on fossil fuel, but it is highly unlikely in my view that we will ever eliminate fossil fuel from the energy picture.

With respect to renewables, it is difficult for me to see at this time how we get there without significant government incentive. However, if there is a major technological breakthrough, who knows?

Tony said...

Ronz, you are absolutely correct in that the natural gas has always been there and hence is not making a significant jump. However, what I was refering to was "economically available" natural gas. In the past, natural gas in shale formations was not "economically available." With advancement in horizontal drilling and hydraulic fracturing technology, this gas now becomes "economically available" and therefore is "recoverable."

With respect to your next point on natural gas contaminating the groundwater, the way that hydraulic fracturing works and where it is being done, the natural gas will not contaminate groundwater used for drinking as these aquifers are much more shallow than where shale formation drilling will take place and are above virtually impermeable layers. Hence the natural gas will not be an issue with respect to groundwater contamination.

New York said...

Fantastic post Tony. As a commercial boiler service company (, we obviously rely on oil heavily in our business. Our goal is to help keep critical systems such as a building's heating plant running at peak efficiency. But more and more, especially in newer buildings, we're seeing the use of natural gas in place of oil.

While all the politicians, activists, and grass roots efforts work to make the use of natural gas on a wide scale a reality, as a responsible business in 2010, our major goal is to ensure that commercial buildings are running cleaner and greener by keeping their commercial boilers and heating plants running optimally.