The word is slowly spreading that we have have a problem
Posted by Heading Out on November 29, 2005 - 1:28am
In a quick scan of news elsewhere I see that India is recognizing their approaching peak production, and the need to find new sources, whether domestic or through pipelines from further north.
Addressing a session on energy at the India Economic Summit 2005, the Minister said domestic requirement was putting a heavy demand on Oil and Natural Gas Corporation (ONGC), which continues to be the dominant player in this field. "ONGC has done a good job in maintaining plateau production from the ageing fields so far. But there is apprehension of a steep decline in oil and gas production from these fields in next few years so we must get into finding new fields," he said.But apart from the ability to find these reserves, one must also have the price incentive to do it. This is currently a topic of discussion in China where there is some concern about natural gas prices crimping production.
Tang Yali, vice-president of the Natural Gas & Pipeline Company under PetroChina. He spoke to China Daily on the sidelines of the China Gas Summit 2005 in Beijing."We now make little profit in the natural gas sector as a result of government-regulated low prices, far behind world levels," said Tang.
Wang Gongli, president of PetroChina's Planning and Engineering Institute, told the summit that the wholesale gas price in the United States was around 5.5 US cents per cubic feet last year, while in China it was less than 0.028 yuan (0.35 US cents) per cubic feet.
"Like gasoline and diesel, we now use higher profits in the upstream crude oil business to offset squeezed profit margins in the natural gas sector," Tang said.
"We have been talking with government bodies including the National Development and Reform Commission to increase gas prices and better streamline the energy pricing system," he said.
Domestic rival Sinopec yesterday made a similar complaint about the rigid price-setting mechanism, which does not fit in with a true market economy.
For ourselves, the MSM seem to be catching on that there may be a problem with natural gas this winter. The CSM quotes the Interstate Natural Gas Association of America (INGAA). Their conclusion
From Maine to Florida, from Virginia to Missouri, as much as half the United States confronts the possibility that harshly cold weather will lead to restrictions of natural-gas supplies. In some places - areas heavily dependent on natural gas to produce electricity - the prospect of "rolling blackouts," or controlled power outages, is much higher than in previous winters.The odds quoted, given a harder winter, are 30% for the North East and 10% for slightly west (to Missouri) and South (to Florida). (They could get worse). The problem is most critical to the NorthEast since
Overall, 23 percent of America's electricity-generating capacity is fueled by natural gas. In New England, however, fully 40 percent of electricity is drawn from natural-gas-fired power plants, up from just 17 percent in 1999. At least 22 natural-gas-fired plants, with a collective 10,000 megawatts of generating capacity, have been built in the region since the late 1990s - a shift that, at the time, seemed good for business and for the environment (because natural gas burns cleaner than alternatives).And unfortunately while some power generation comes from dual-fuel generators, this is not so much the case in NE.
And if we think it is bad here, just consider the case of the UK, where all of a sudden those arguing for a free market economy, might want to consider the current situtation in Europe.
There is no free, deregulated energy market on mainland Europe. The old monolithic utilities -- Gaz de France, Distrigaz of Belgium, Ruhrgas and the Dutch Gasunie -- thrive and some have expanded abroad. But the door to their domestic markets are shut. While British manufacturers wail at a quadrupling of the spot price of gas since the beginning of November, their continental counterparts are benefiting from prices at between one-third and half of the going rate in Britain.Centrica, the company that inherited the British Gas retail brand, is short of fuel and wants to buy cheap wholesale gas from Russia, but it cannot access German pipelines to get the gas to Britain. The U.K. Energy Minister is on the stump complaining about the EU's failure to create a competitive energy market with open borders. The European Commission huffs and puffs and issues reports but the big European utilities just shrug.
I suspect that by the time that this winter is over, given the predictions that it may be a bit harder than some in the recent past, that there will be more than the odd series in local papers exploring the issues.
The problem however, as we constantly note, is one of time. It is all very well to write about solar panels, but if you can't get them for over a year, what do you do in February or July? And if anyone thinks we can expect a new nuclear power station in the United States within the next decade . . . . On the other hand, this may mean the return of the coal miner to the UK
In regard to comments elsewhere about the free market and its impact on price, I will mischievously end with another comment from the Telegraph
As everyone knows, we British love to talk about the weather. By contrast, we find economics boring, and science more so - to the extent that almost no one can be found to teach physics in our schools these days. Happily, this is a story in which the weather plays a key role.Sadly, by February we may no longer find this as amusing.It all began with the prediction that this might be a colder-than-average winter. Now, do not ask me why anyone believed this. Weather forecasts beyond a 24-hour time horizon are subject to very high margins of error. Never mind. It was enough to get them singing White Christmas in the City of London and before you could say "Bing Crosby" the price of natural gas leapt from 30 pence a therm to above 150 pence a therm.
This is what free markets often do: overshoot.
Incidentally my other reading on vacation was "The New Great Game - Blood and Oil in Central Asia" dealing with the problems of working with the local governance as some of the last potential great fields are found and exploitation is planned. While I will write on that more later, it was interesting to note that at the end of the book Lutz Kleveman indicates the progressive interest of Russia in reclaiming power over the region. And then one reads about the current development of a new field in Siberia at Sibir and some of the machinations there, and one does begin to wonder.
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In the first, titled "Rising grocery costs not as bad as feared for holidays," an agricultural economist opines, "It doesn't make sense for a retailer to raise prices in response to a short-term energy spike." The basic conclusion of the article was that most manufacturers and retailers haven't raised prices yet because those that have done so have lost market share.
In the second article, titled "Driving tax considered for funding roads," I read that the US Chamber of Commerce commissioned a report about how to fund our transportation infrastructure. They found that the trust fund supported by federal gasoline taxes will hit a zero cash balance in 2008. (Hmmmmm. Interesting that it could happen around the same time as many are saying the oil supply problems will really start getting bad.) They also projected a $500 billion shortfall in what's needed to maintain our automobile infrastructure and $1.1 trillion shortfall to improve it.
Their solution? Put a tax on hybrids and other fuel efficient cars, of course. Just brilliant!
That has to be one of the most bone-headed ideas by a government bureacrat that I've heard in a long time! Don't they have a prize somewhere for the year's most stupid idea?
It's things like this that make me despair over whether our government is up to the challenge of doing anything useful regarding our energy situation. While they certainly have the money (yours and mine, actually), they sure don't have the will, the focus, or the common sense.
Rick DeZeeuw
For that matter, neither is the Federal Reserve part of the government, but does anyone doubt that this entity is just about the most power 'non-governmental' government agency?
http://peakoildebunked.blogspot.com/2005/11/178-countries-without-coal.html
Somebody over there thinks there's lots of coal left.
http://desmoinesregister.com/apps/pbcs.dll/article?AID=/20051126/OPINION03/511260307/1110
The article falls short though when it calls for this:
A better designed auto is the reason we should convene a national summit to chart our energy future?? Houston, we do have a problem..
In Toys'R Us stores across the country (USA), children are learning the power of magic words and crying. If you cry hard enough and make your wants known, the desired toy magically appears.
After all, isn't this the message of the new movie, Harry Potter and the whatever? Young wizards and aspiring witches are sent to school to learn how to make magical incantations. Then poof, whatever you want appears as long as you uttered the right words.
It's the same with journalists. They utter magic words. Then poof. Thousands of smart engineers and scientists appear out of thin air. New "technologies" (whatever the heck those are) appear out of thin air. ("Oh Great Wizard in the sky, give onto us new alternate energies this day.") They rain down upon us like so many toys from the toy mega-store. Once again we get what we cried for. The world is a wonderful place, a wonderful life.
Given that over 100 years of economic "progress" was the result of the automobile, isn't it obvious why some people cannot get past that mental model on how to run a country?
You are correct in that doesn't make it right but it's very understandable.
Well, that sure as hell doesn't sound like the US anymore, does it?
Has any one explored the idea of ocean wave generators. i.e., generate electricity from the relentless motion of ocean waves? The energy per meter of coast line may be much higher than the solar radiation energy per square meter of area. So I think there is a great potential in that. I just do not know the cost figure per kilowatt.
Makes me wanting to buy some property right next to the beaches :-)
There has been quite a bit of work on developing wave energy converters (WECs) since about the mid 1970s, mostly in the UK, Norway, and The Netherlands. Unlike wind power, in which one windmill is conceptually more or less like another windmill, there has been a amazingly broad range of concepts and physical configurations that have been tried.
As you correctly point out, wave energy is much more concentrated than either sunlight or wind energy. Unfortunately, the best locations for wave energy, such as the northern coast of Scotland, western Ireland, Norway, and the tip of South America, are places where you need lots of energy the least. As an example, the energy content of waves off Scotland are typically 50 - 60 kilowatts per meter of wave front (i.e, measured perpendicular to the direction of the incoming wave). The Atlantic coast of the US is aroung 25 to 50 kw/m. The tropics are the least favorable with much lower numbers.
However, how to harness wave energy with a practical, economic, and survivable system is the rub. It can be done, but WECs are not cheap and are vulnerable to damage from severe storms. Some are better than others in that regard. There are several now in actual full-scale use in Scotland, and the same company will soon be installing some in Portugal (also a pretty good location).
You can hardly go wrong acquiring beachfront property, but the prospects of using it for wave energy is the least of the attractive features.
I don't think wave energy will ever make more than a tiny, highly localized dent in alleviating the world energy demand. But it's still an area that's fun to dabble in. By the way, the US has done very little in wave energy later than the early 1980s.
Er...two words: New Orleans.
Seriously, much as I love the ocean, I think beachfront property might be a huge waste of money. There are two major reasons for the explosion in the population living near U.S. coasts. One, we've been in a long period of low storm activity. People have forgotten how dangerous it is. Two, air-conditioning has become cheap and widely available; the hot, humid coastal regions can be made comfortable.
All this may be changing, with peak oil, global warming, etc. Without cheap energy, and in a warming world where the ocean is rising and hurricanes are more frequent, living near the beach will not be nearly as appealing.
Perhaps I am thinking of the recent past, where if you bought beachfront property a decade or so ago, you could easily realize several times what you paid for it. Maybe the right thing to do if you already have beachfront property is to sell it ASAP while the prices are still up in the stratosphere.
http://www.nwcurrent.com/commentary/ronpernick/1303107.html
"Last August, Ocean Power Delivery, a wave power company, successfully unveiled the world's first commercial-scale grid-tied wave energy converter off the coast of Orkney, Scotland."
I am not familiar with the economics, but what appears to be the most attractive feature of the Pelamis is its survivability. It is loosely moored, and rides with over-sized storm waves rather than resists such waves and suffer high structural stresses. In other words it is more 'wave friendly' than a lot of other systems. Still, it looks like a rather expensive piece of machinery for the amount of power generated.
It appears to be a good first start.
I don't think some people ever get it... 5 billion people have the same needs and desires as ours - to be warm, fed, to drive cars. For this 5 billion $14,000 is maybe the half of what they earn in their lifetime. How do you sell this idea to them? If anything can be done to fight energy shortages and global warming this is not it.
Hopefully Britain's predictable disaster will help them (and us?) wake up and build those nuclear power stations that can only fill the gap without trashing the environment completely.
Passenger cars per 1000 capita (http://earthtrends.wri.org/):
India: 6.1 (2000)
China: 7 (2000)
USA: 481 (1999)
I see your point, but exactly because home heating is much more important than cars there needs to be found an affordable solution of the problem. In my home country with $14000 you can heat/cool your house with electricity and pay your bills for at least 30 years (electricity is close to 50% from nuclear power). In USA (due mainly to bigger houses not prices) it would be maybe around 10 years on average. All of this not counting the cost of system maintenance and the likehood of shooting prices if everyone starts to do that.
If there is a way out of this it should include cooperation between first and third world countries (and those between) plus abandoning of the free-trade-of-cell-phones-against-bananas neocolonialism.
Bulgaria did not (as of the last time I looked) because the alternative would be to have even less reliable acess to electricity supply. People will tolerate a great deal of risk when the alternative is to freeze in the dark. Many other countries are likely to be in the same position in a few years time and will probably make the same choice. Nuclear power is a double-edged sword at best.
Everything is a risk, life is a risk too. I could claim that your fire furnace is dangerous, but I'm not the one who is competent to tell you to disassemble it, right? The decission to close units 3 and 4 was part of the long-term commitment of EU to abandon nuclear power and had little to do with safety. VVER-440 nuclear reactors are considered one of the safest with units successfully operating (for already 30+ years) in Russia, Finland, Hungary, Cuba, Czech Republic, Slovak Republic, Armenia, Bulgaria etc. More info here. China is currently building 2 units of the next generation VVER-1000 reactors.
Thanks for updating my information on units 1 and 2. I haven't been following the specifics of the debate since I left Europe and am a little behind the times it seems. I think it was always clear that Europe would make decomissioning a condition of membership as all member states assume a measure of joint responsibility for dealing with problems. However, I can see why Bulgaria would have wanted to keep Kozlodui despite the risk, as the alternatives are not particularly attractive. Personally, I have much less of an objection to the VVER-440 (except that the one in Armenia is in an earthquake zone) than to the RBMK on safety grounds. The latter's large positive void co-efficient and lack of containment make me nervous.
The point is that people are prepared to live with a much higher level of risk if the alternative is to have very limited access to electricity. One might say that the choice should be theirs to make, with the caveat that it should be a fully informed choice, although the environmental consequences of an accident may not be confined to Bulgaria alone. It seems that the EU should be assisting Bulgaria with alternatives rather than forcing them to chose between a rock and a hard place.
That sort of choice is not one the populations of the US and Western Europe have yet had to make, but I would argue that it lies in their future. After the fall of the Soviet Union, the UES was bogged down in debt. Workers were not paid and maintenance on all generators (nuclear and otherwise) was greatly delayed because no one was able to pay for their electricity supply. Nuclear operators had to moonlight in order to make ends meet. The risks went up substantially, and would have done so no matter what kind of nuclear technology had been in use. Sound technology does not guarantee a very low risk of an accident under circumstances of economic collapse as the contextual factors become dominant. I think the West is now facing a similar economic collapse, which is why I consider nuclear power to be a double-edged sword.
It is true that Chernobyl was a disaster, but yet it was overcome though with enormous efforts. The radiation released was around 400 times less then the radiation from the nuclear test made by USSR, USA and France in the past. About 50 deaths were attributed directly to the accident by now, but there is still no evidence of significantly increased cancer cases.
A lot more then 50 people die annually in the coal mines around the world and countless of thousands suffer from the coal power plant pollution.
The reasons for Chernobyl were mainly in the technical flaws of the RBMK reactors, which of course are no longer built and the last ones are due to be closed soon. I know it is a tough choice but soon we'll have to make it:
- We could choose a probable but yet controllable risk from developing nuclear power
- We could choose a certain catastrophe after 30 years or less when there will be neither oil nor NG around, while coal will be restricted.
BTW anybody had the idea of building nuclear plants underground?I think that underground nuclear has some issues:
Unit 1 was closed on December 31, 2004. Unit 2 will close in 2009, if I recall correctly.
I read in the local newspapers today that the Lithuanian government is making preliminary estimates of what it would cost to build a new reactor(s), to enter into service in 2015. If they give enough contracts to German companies, maybe they'll let us keep Ignalina's Unit 2 going until 2015?
Hey, here's a trade: Germany can build its pipeline from Russia across the Baltic Sea (and set off any number of Nazi chemical munitions that were dumped by the British, Americans, and Russians into the Baltic Sea after World War II), and in return Lithuania gets to keep the lights on for another few years. Sound fair? Ah, the delights of post-Peak Oil realpolitik!
I'm curious as to how Lithuania will manage, and how its people feel about having make that sort of choice. Do they, and you, worry about living near Ignalina? At Chernobyl (if memory serves), only 3 of the 1700 channels had to be compromised for an explosion to occur, which would then be exaccerbated by the flammable graphite moderator. Ignalina is much newer, but also larger and inherently less stable. Presumably it, like Chernobyl, also has (or at least had) a once-through cooling circuit rather than primary and secondary circuits with a heat exchanger? In the Ukraine that meant a 25 square kilometer cooling lake as radioactive as the primary cooling circuit of a more conventional reactor. Local people used to fish in it.
You're quite right about post-peak realpolitik - it's likely to be nasty. Eastern Europe is a very interesting energy case study because it's already had to make some hard choices under conditions of economic and political adversity. I seem to recall that the Chechens were charging $6 dollars a barrel to allow Russian oil to flow through Grozny in the mid-1990s, and the Ukraine was avoiding an energy crisis by helping itself to gas from the Gazprom pipelines running through the country. Nuclear plants conferred a degree of political independence as they allowed Eastern European states to avoid becoming dependent on Russian gas - no wonder the Ukraine insisted on the completion of Kmelnitsky and Rivne before agreeing to close Chernobyl unit 3. The EBRD even had to have the least-cost assessment rewritten in order to allow for them to be financed. These sorts of choices are likely to have to be made in many other places in the post-peak era and I bet we decide we can live with a great deal of risk rather than face the alternative.
- increasing the capacity and efficiency of the generators at the Elektrenai conventional-fuel-fired plant;
- trying (without success, so far) to string higher-capacity electric transmission lines to Poland;
- cooperating with Latvia and Estonia, to construct the undersea power connection to Scandinavia.
Lithuania has set a target of producing 7% of its energy needs via renewable power sources by 2008, if I recall correctly. I sometimes wonder if this is more of a ceiling than a floor!The EU will help with Elektrenai, as partial compensation for Lithuania having agreed to shut down Ignalina.
I hesitate to speak for everyone in Lithuania, but I suspect that most people don't mind the risks. They've lived with those risks for decades now. The biggest energy controversy at the moment concerns the prospect of Gazprom raising its rates for natural gas delivery from 80 or 85 USD per thousand cubic meters to 120-130-?? USD per thousand cubic meters. The obliviousness to Peak Oil here is astounding.
Ignalina is considerably more stable than what was at Chernobyl. Remember the source of the problem at Chernobyl: it was a safety test, to see how the reactor would perform as it was powered-down. (This, of course, was madness, but let's gloss over that...) Within the last six months, a natural gas pipeline to Ignalina was completed, allowing the plant to install gas-fired turbines, thereby guaranteeing another independent source of power for plant operations in the event of an emergency shutdown. There have been a huge number of improvements made during the last decade. An acquaintance works there -- I wonder if he spends more time abroad than at the plant.
Back in '94, when security was a lot laxer than it is now, I visited the general vicinity of the plant. I don't recall seeing any 25-sq-km lakes, but maybe I missed something!
I should excuse for overreacting a bit, but this touched a sensitive question for my home country. We were forced to close 1760 MWt of nuclear power by the European beurocrats; and what do you think they recommended as replacement? Wind and solar of course...
by Ted Trainer from the School of Social Work at the University of New South Wales:
Sorry for the long quote. Read the whole thing. It's powerful.
http://www.csmonitor.com/2005/1129/p01s02-usec.html
It was reprinted in USA Today as well.
From Maine to Florida, from Virginia to Missouri, as much as half the United States confronts the possibility that harshly cold weather will lead to restrictions of natural-gas supplies. In some places - areas heavily dependent on natural gas to produce electricity - the prospect of "rolling blackouts," or controlled power outages, is much higher than in previous winters.
Any natural-gas cutoffs would primarily affect electric-power plants and factories fueled by gas, not homes, and be most likely in the Northeast.
If cold deepens for prolonged periods, the likelihood of interrupted natural-gas supplies rises to 30 percent in the Northeast and to 10 percent as far south as Florida and as far west as Missouri, according to a recent report by the Interstate Natural Gas Association of America (INGAA), a trade association representing gas pipeline companies. In a "worst-case" scenario, chances of interrupted gas rise to 40 percent for the Northeast and 25 percent across the eastern seaboard.
Though power-industry officials in New England are the most concerned, noting the region's lack of fuel diversity and propensity for intense cold, the impact could be far broader. If winter temperatures plummet for long, natural-gas supplies could be quickly depleted, leading to a power crunch in some regions and soaring prices across a wider area, experts say.
http://www.princeton.edu/hubbert/current-events.html
(Dang, I'd love to see that sweet potato casserole with Hubbert's peak in marshmallows on top...)