The federal government has sold more than 400,000 acres in the Gulf of Mexico off the Texas coast for oil and gas exploration and development, an official with the Bureau of Ocean Energy Management said Wednesday.
If you want to get a special incentive for driving a hybrid, you’re a few years too late; but a tax credit applies to nearly every electric car and plug-in hybrid on the market and it can, in some cases, effectively reduce your cost for such a model to that of an ordinary gasoline vehicle (or even less).
Reducing the transportation sector’s dependence on oil has long been a policy goal of governments globally. The sector’s overwhelming dependence on the resource results in major costs that affect energy security, environmental security, and economic stability for nations globally.
What if a clever business model could lower the retail price of a Tesla compact sedan to less than $20,000, or make an extended range option like BMW’s i3 attainable for under $30,000? Could such pricing make electric vehicle adoption a no-brainer for a larger group of drivers? The business model that helped make the smartphone widely indispensable may offer a clue.
Ethanol produced in the United States has been the most economically competitive motor fuel in the world over the past four years and has played an important role in reducing consumer fuel costs, according to a newly released analysis by the Renewable Fuels Association (RFA).
Stocks.org
CEO Elon Musk stated at the annual shareholder meeting last month that he was confident that Tesla would be able to roll out vehicles that could take the user from the highway entrance to the highway exit without touching any controls.
News.Yahoo.com
Despite the Keystone XL pipeline still waiting final approval (currently in a review process that won’t be finished until after the 2014 midterm), one thing that is for certain is the North American energy renaissance is for real. Domestic production of crude oil and natural gas is on the rise, as the U.S. eyes the possibility of finally achieving energy independence.
The decision isn’t scheduled until June but already opposing sides are converging on Washington, trying to pressure the Environmental Protection Agency over the 2014 Renewable Fuel Standard for ethanol.
Last week almost 100 members of the American Coalition for Ethanol descended on the nation’s capital for its annual “Biofuels Beltway March,” buttonholing 170 lawmakers and staffers from 45 states. The object was to send a message to EPA Administrators Gina McCarthy to up the ante on how many billions of gallons the oil refining industry will be required to purchase this year.
The ethanol program is currently in turmoil. The latest problem is rail bottlenecks that have slowed shipments and created supply shortages over the winter months. Record-breaking cold and four-foot snow pack have been partly responsible but the rail lines are also becoming overcrowded. With all that oil gushing down from the Bakken and Canadian crude now finding its way into tank cars as the Obama Administration postpones its decision over the Keystone Pipeline, ethanol is getting tangled in traffic. .
“Ethanol for April delivery sold for about $3.02 a gallon on the Chico Board of Trade, an 81 percent increase over the low price during the past 12 months of $1.67 a gallon reached in November,” reported the Omaha World-Herald last Friday “This weeks settlement price of $2.98 a gallon was the highest since July 2011.” With only so much storage capacity, some ethanol refineries have been forced to shut down until the next train arrives to carry off the inventory. As ethanol becomes mainstream, it is becoming more and more subject to market events beyond its control.
But the big decision will be EPA’s ruling in June. In accord with the 2008 Renewable Fuel Act, Administrator McCarthy must set a “floor” for amount of ethanol refiners will have to incorporate into their blends during 2014. The program ran into trouble last year when the 13.8 billion gallon requirement pushed ethanol beyond the 10 percent “blend wall” where the auto companies will not honor warrantees in older cars. Refiners were forced to purchase compensating Renewable Identification Numbers (RINs), which exploded in value from pennies to $1.30 per gallon, forcing up the price of gasoline. Contrary to expectations, gasoline consumption has actually declined over the last six years, from 142 billion gallons in 2008 to 134 billion in 2013 as a result of mileage improvements plus the lingering effects of the recession. Last November McCarthy proposed reducing the 2014 from 14.4 billion gallons to 13 billion. The industry has been crying “foul” ever since.
But there are other ways to fight back. Last week in Crookson, gas stations were offering Minnesota drivers 85 cents off a gallon for filling up with E-85, the blend of 85 percent ethanol that many see as the real solution to the blend-wall problem. “We want the public to understand there are different ratios of gasoline and ethanol and how they can save you money,” Greg LeBlac, of the Polk County Corn Growers, told the Fargo Valley News.
At the annual meeting of the American Fuel and Petroleum Manufacturers (APFM) in Orlando last week, Anna Temple, product manager at WoodMac, made the case that the industry should forego efforts to raise the blend wall from 10 to 15 percent and instead shoot for the moon, leapfrogging all the way to E-85, where ethanol essentially replaces gasoline completely. (The 15 percent only ensures starts in cold weather.)
“E-15 is a non-starter in terms of market share,” Temple told her audience, as reported by John Kingston’s in Platts. http://blogs.platts.com/2014/03/25/eight-fillups/ She argued the incremental battle would absorb vast amounts of political capital yet still not be enough to absorb the 15-billion-gallon target for 2021. Instead, Temple pointed to the growing fleet of flex-fuel vehicles that now numbers around 15 million, headed for 25 million in 2021 or 10 percent of the nation’s 250-million-car fleet.
“If U.S. drivers poured about 200,000 barrels-per-day of E-85 into their flex fuel cars in 2021, that would take care of about 17 percent of the scheduled ethanol mandate,” Temple said. “It would only require that flex-fuel owners fill a 15-gallon tank eight times a year.” The remainder would be absorbed in the 10 percent blend and ethanol producers would not have to cut output.
Platts’ Kingston checked the math and found that even this goal would leave ethanol consumption slightly above the blend wall at 10.5 percent. “Still, the very modest number of eight fill-ups per flex fuel vehicles per year makes the whole blend wall issue seems a lot less daunting,” he confessed.
Of the 15 million people who own flex-fuel vehicles, of course, many don’t even realize it. (The yellow gas cap or a rear-end decal are the giveaway.) But the number of gas stations offering E-85 pumps is rising. The Energy Information Administration now estimates the number at 2,500 with most of the growth taking place outside the Midwestern homeland. California and New York each have more than 80 stations apiece.
The problem of rail bottlenecks can probably be solved by increasing the number of E-85 outlets and flex-fuel vehicles to bring supplies closer to the place of consumption. Still, the industry would probably be happy to have a bigger renewable fuel mandate as well.
The concept of converting our abundant natural gas supplies into liquid methanol in order to replace oil in our gas tanks has had trouble gaining traction for several reasons, all of which are about to face change.
The first reason is that most of the attention towards additives has been focused on ethanol made from corn. Driven by highly specific government mandates, corn ethanol — which now consumes 45 percent of the country’s corn crop — has taken up whatever role industrial methanol might have been chosen to play as a gasoline additive.
Secondly, there’s the problem of the Environmental Protection Agency. Not only has the EPA not approved methanol for gas tanks, the organization actually imposes huge fines on anyone who converts a gasoline engine to methanol without its permission.
The third, and less distinguishable explanation for methanol’s difficult implementation, is that the whole idea has never been very sexy. Methanol has little to do with the “Cutting Edge” or the “New Age Economy.” The manufacturing of methanol is a 60-year-old process practiced doggedly by dozens of industrial facilities around the world. They produce 33 billion gallons a year at the reasonable price of $1.50 per gallon; the energy equivalent of $2.35 gas. Meanwhile, Elon Musk seems to announce a new milestone for the Tesla, or some “breakthrough” in battery technology or cellulosic ethanol emerging from the university laboratories each week, making methanol appear rather plain-Jane and old fashioned. In effect, the solution to our gas tank woes has been hiding before us in plain sight.
Now an announcement from the Scripps Howard Research Institute and Brigham Young University may change everything. In a paper published last week in Science, a team led by Roy Periana of the Scripps Florida Center and Professor Daniel Ess of Brigham Young University say they have found catalysts made from the common elements of lead and thallium that facilitate the conversion of gaseous methane to liquid methanol, potentially making the process even cheaper and more accessible.
The hydrogen bonds in the alkanes (methane, ethane, propane, etc) are among the strongest in nature. To break them involves a heat-driven process invented in the 1940s that is conducted at 900 degrees Celsius. For more than two decades, the Scripps team has been looking for catalysts that would shorten this heat requirement. In the 1990s they came up with a series of catalysts employing platinum, palladium, rhodium and gold, but quickly realized that these elements were too rare and expensive for commercial application. So it was back to the drawing boards in search of something more useful.
Last week in Science they reported success:
The electrophilic main-group cations thallium and lead stoichiometrically oxidize methane, ethane, and propane, separately or as a one-pot mixture, to corresponding alcohol esters in trifluoroacetic acid solvent.
The process reduces the heat requirement to only 200 degrees Celsius, which introduces enormous potential for energy savings. That “one-pot” notation is also crucial. Methane, ethane and propane all come out of the Earth together in natural gas. Currently, they must be separated before the heat-driven process can begin, With the new catalysts, no separation will be necessary. This means that methanol could become significantly cheaper to harvest than it already is. More importantly, these findings signify that methanol conversion will be able to weather the inevitable price increases that will result as demand for natural gas supplies multiplies.
Periana says the process is three years from commercialization. Reports Chemical & Engineering News:
The team is in discussion with several companies and entrepreneurs and would ideally like to jointly develop the technology with a petrochemical company or spin off a startup.
Periana also claims that “Initial targets would be higher-value, lower-volume commodity chemicals such as propylene glycol or isopropyl alcohol directly from propane.” He told reporter Stephen Ritter:
The next target could be to develop lower-temperature processes for higher-volume chemicals, such as converting methane to methanol and ethane to ethanol or ethylene as inexpensive sources for fuels and plastics.
An enormous portion of the world’s energy consumption is still tethered to oil, particularly the transportation sector, where oil constitutes 80 percent of consumption. As oil becomes more and more difficult to find, natural gas use is escalating. In addition, 25 percent of the world’s gas is still flared off because it has been uneconomical to capture. All this could change rapidly if a low-cost conversion to methanol becomes a reality. Reuters grasped the implications of this development when it reported that the new catalytic processes “could lead to natural gas products displacing oil products in the future.”
Last week in Houston, Secretary of Energy Dr. Ernest Moniz told CERA Conference attendees that storage batteries may be the next big energy breakthrough. “It’s pretty dramatic,” he said. “The research is moving very, very fast.”
Indeed, if you’re looking for “energy breakthroughs” on the Internet these days, most of the hits are likely to turn up something new about “flow batteries,” “ten times the storage capacity,” or some new cathode material that dramatically improves the performance of lithium-ion batteries.
So where do we stand in this energy revolution now, and what are the possibilities that any of these breakthroughs are likely to lead to real improvements in our attempts to wean ourselves off traditional energy resources like fossil fuels?
A good place to start is “Next Generation Electrical Energy Storage: Beyond Lithium Ion Batteries,” a panel put together for last February’s meeting of the American Association for the Advancement of Science in Chicago. Three experts – Haresh Kamath; of the Electric Power Research Institute, Mark Mathias; of General Motors, and Jeff Chamberlain; of Argonne National Laboratory – discussed the latest developments in the industry.
All three panelists agreed that battery research is progressing along two separate tracks:
1) lithium-ion batteries that power most consumer electronic devices are now being scaled up for electric vehicles; and
2) larger and more durable conventional batteries for the storage of grid-scale electricity.
Despite whatever hopes Elon Musk may have that his new “Gigafactory” will be able to address both of these markets at the same time, that does not seem likely. “Lithium-ion just doesn’t have the durability that we’re looking for in the utility industry,” Kamath of EPRI told the audience. He continued:
I was doing cable research one time and we had a model for a product that would last 40 years. The utilities looked at it and said, `Could you try for 60 or 80?’ The utilities are looking for things that last a long, long time.’ said Kamath.
“There’s a lot of experimenting going on,” Kamath added, “but everything that is on the grid right now is a demonstration. No one has yet come up with a sustainable business model.”
With electric cars, on the other hand, the challenge will be in equipping batteries with enough energy density so that their weight does not load down the vehicle to the point of being counterproductive. “The standard measure is that you need 100 kilowatt-hours of power to drive a mid-sized vehicle 300 miles,” said Mathias, who works at GM’s electrical storage research and development project. He explained.
If you get up in the density range of 350 Watt-hours per kilogram, you can make it. But current batteries are operating at around 150 Wh/kg, which gives them a range of 125 miles. The best we can project is that they can achieve 225 Watt-hours per liter, which still leaves them short. (Mathias).
“Fuel cells operating on hydrogen actually do a much better job at this point,” he added. “They can now get us up in the 300-mile range. We regard them as electric vehicles as well. It’s just that you generate the electricity on board.”
Then there’s the matter of cost. Capital costs for lithium-ion batteries quickly rise into the $20,000 range. Fuel cells cost only $6,000 and gas-electric hybrids, $4,000. “The good news for EVs is that fuel costs are only about one-third that of gasoline,” said Mathias. “Over a span of 100,000 miles, a gasoline engine will cost you $10,000 in fuel. A hydrogen fuel cell vehicle will cost only $6,000 and a pure EV, $3,333.” Still, that’s a long time to wait and a long way from complete cost recovery.
Refueling time is also a bit of a problem. “When you pump gasoline into your car, you’re actually adding range at a rate of 150 miles per minute,” said Mathias. He went on to say:
With hydrogen fuel, it’s 100 miles-per-minute, which is acceptable. But even with the new 120-kW superchargers, you can only add mileage to an EV at a rate of 6 miles per minute. If you take a long- distance trip, you’re going to spend 20 percent of your time recharging. (Mathias)
Overall, Mathias was not overly optimistic about further improvements. “There’s not much on the horizon,” he concluded. He was more optimistic about hydrogen cars.
Chamberlain, of Argonne National Laboratory, is part of a $120 million program funded by the Department of Energy that is aimed at developing batteries with five times the current energy density at 1/5th the cost within five years. “That’s a very ambitious goal,” he told the audience, “but we feel that’s what’s needed to transform the transportation sector.” A long chain of national and university laboratories are involved in the project. Of course, government goals and mandates are just that – projections that may or may not come true. Steve Jobs was good at inspiring his cast to pursue seemingly impossible goals but the federal government does not always have the same success.
So far, the research has involved searching the periodic table for more candidates. “We’re not sure what we’re going to come up with,” said Chamberlain, elaborating:
We’ve decided that capacitors will never help us reach our goal. The charge dissipates too quickly. So we’re exploring other materials. It may involve a metallic anode and a suspended-particle cathode. If you move to magnesium or aluminum, you’re releasing two electrons instead of one. But zinc-air and lithium-air doesn’t get you there because they simply don’t have the power.” (Chamberlain)
Chamberlain said that a lot is already known about lithium-ion. “We may be able to get two times what we have now.” He had to agree with Mathias that no other significant developments are on the horizon right now.
Mathias warned against new reports that are constantly announcing progress at the material level. “We often realize right away that they’re not going to work,” he said. “It’s not worth the manufacturing dollars.
Overall, the takeaway from the panel was that Tesla has its work cut out for it. Progress on electric vehicles will be tough. The panelists agreed that natural gas vehicles make a lot of sense. “The problem is you don’t really solve the CO2 problem,” said Mathias. He did express confidence that battery research would eventually pay off in the end. “All this progress will eventually be harvested at the hybrid level,” he said. “It may not lead to pure electric level, but there is going to be a lot of improvement in hybrids.”
