The Round-Up: November 15th 2006

Grass growing as potential fuel

"The opportunity exists to produce gas from grass or pellets from grass and heat buildings or even use it for transport,'' Samson told a seminar sponsored by the Frontier Centre for Public Policy in Regina Tuesday.

"This (biomass) is a very viable option for the transportation sector,'' said Samson, who's based in Quebec.

Yet governments continue to pour millions into subsidies to produce ethanol and biodiesel, which are less energy efficient than biogas produced from switchgrass, said Samson, who's been working in the field of bioenergy development since 1991.

Oil crunch said to be overstated

I would call this aggressive cornucopianism.

In sharp contrast to popular doomsday scenarios in which an oil supply crash triggers a global economic crisis, a U.S. energy think tank says the world has just over three times the oil supply envisioned by pessimists.

Cambridge Energy Research Associates says in a report released Tuesday that so-called ''peak oil'' theories are not only wrong, they're threatening efforts to develop new sources of supply.

Activists keep pressure on Canada at UN talks

"The only country that has a Kyoto target and that's turned its back on Kyoto is Canada," said Steven Guilbeault of Greenpeace Canada.

He added that what makes Ambrose's claim particularly objectionable is that "one of the first things her government did when they came to power was abolish pretty much anything that existed in terms of implementation measures."

Liberal MP John Godfrey noted the Tories cancelled things like wind energy incentives and the Energuide program.

Canada faces debt crunch

Canada may have been racking up surpluses for the past decade but it has barely put a dent in the national debt and a new fiscal time bomb looms -- soaring obligations for programs like medicare, according to a report released yesterday.

Federal, provincial and local governments have accumulated $2.7-trillion in government liabilities -- $171,032 for each Canadian taxpayer -- in addition to $798-billion in direct debt, according to the report from the Fraser Institute.

"We are moving in the right direction," said Niels Veldhuis, senior research economist at the Fraser Institute. "But the bigger problem of course is the problem most Canadians are not aware of, the unfunded liabilities of the obligations we've promised."

Solar expected to shine

The Ontario Power Authority says there's great potential for solar power in the province, but sometimes you have to wonder whether it truly believes what it says.

Housing bubble burst in U.S. cools B.C. exports

The shock wave caused by the bursting U.S. housing bubble is hitting British Columbia faster and harder than the rest of Canada, and is expected to drag down the total value of B.C. exports by three per cent in 2007, according to an outlook prepared by Export Development Canada.

Nuclear program nearing fruition

President Mahmoud Ahmadinejad signalled Tuesday Iran is on the verge of mastering the entire nuclear fuel cycle, saying the country would soon celebrate the achievement.

He also claimed the world is ready to accept Iran's "full nuclearization" despite U.S.-led efforts at the United Nations to pressure Iran into rolling back its nuclear program.

The statements appeared to suggest Iran is increasingly confident it will prevail in its defiance of the West, given the changed political landscape in the United States and British Prime Minister Tony Blair's effective acknowledgment Monday that Iranian and Syrian help is needed to bring stability to Iraq.

Oil prices advance ahead of U.S. energy report

Oil prices edged up Wednesday as traders awaited the release of the weekly U.S. inventory report.

Mild weather in much of the Northern Hemisphere is dampening demand for heating oil and natural gas, however.

Production is back up at Terra Nova. The platform shut down in May.

Average production in the fourth quarter is expected to be 33,000 barrels per day
Not oil related I know, however, the downturn for Canadian timber producers is very, very grim - perhaps the worst it's ever been.

Paul Quinn of Salman Partners, believes that with lumber prices now well below producers' costs, an estimated 7 billion board feet of production needs to be taken out of the North American market in order to restore profitability.

And that's sans US housing collapse, increasing energy costs and weak US$.

I include economic headlines here on occasion as the developing economic situation in the US, which many people are not yet sufficiently attuned to, has very significant implications for the Canadian economy in general and the energy industry in particular.

In my opinion, the housing collapse in the US has barely begun. As it underpins a large chunk of the derivatives market through mortgage-backed securities, the fallout could be horrific. Mortgage backed securities are only as secure as the mortgages of the marginal borrowers whose ARMs are due to be reset over the next few years. I doubt very much that the lumber industry will be the only one affected.

I definitely agree with you on this one.  As far as I'm concerned, the world is staring global recession if not outright depression right in the mouth.  This, as a direct result of the ensuing collapse. will blow you away at just how bad it really is and how bad it's going to get.

I've read the housing bubble blog man times before, among other media with similar messages, and I agree that the consequences are likely to be far worse than most people imagine. My personal view is that we are very close to the beginning of a deflationary depression that I think will lead to a liquidity crunch as a credit pyramid of unprecedented dimensions implodes.

In my opinion, financial crisis will precede the developing energy crisis and ineract with it in complex ways, probably leading to extreme price volatility in the energy markets for an extended period. Lack of visibility and insufficient liquidity could kill capital intensive exploration and non-conventional production, leaving us fully exposed to the downslope of Hubbert's curve with no continuing discoveries to limit the impact. Geopolitical risk is also increasing rapidly and could threaten access to conventional reserves as well, which would be extremely serious.

Unfortunately it's adapt or die, and if these giant behemouths can't adapt from producing only 2x4s etc. for the US market to making other wood products such as furniture, doors, even firewood/pellets, then they will suffer. Apparently some smaller (worker-owned) mills in Quebec have the ability to adapt and so are able to survive by changing markets (sorry no reference, my Masters supervisor told me this)

Actually my Masters dissertation is to estimate the maximum potential for wood as a residential heat/energy source in Quebec, while sustainably managing the resource and keeping emissions to an acceptable level. It seems like there is a lot of confusion in the media (and government!) about what exactly are the pros and cons of wood for energy, but one big pro is it being CO2 neutral. The PO angle is to provide a certain energy independence for people (heat-wise) and reduce dependence on FF. As far as I am concerned, getting equipped with a hi-efficiency burner is a no-brainer for anyone trying to prepare for Post-PO.

Any thoughts on this research project from TOD:Canada readers?

ours solitare, I have spent most of my working life as a consultant in the field of residential wood energy and worked inside government for a year back in the early 1980s as a wood heat policy adviser at energy, mines and resources. I think there is more than just confusion in government and media regarding wood energy, and in that group I would include environmental NGOs. These groups are alergic to wood energy, largely because of their urban location and world view. Government, certainly, is terrified that if it says anything remotely positive about wood energy, everyone in downtown Montreal and Toronto will buy wood stoves and start polluting the air. But unlike proponents of oil and gas, I don't think wood is the ideal fuel everywhere and for everyone. It is regionally appropriate. I wasted years trying to get the feds to refine their policy approach to wood energy, but I gave up a couple of years ago. I see wood as the ultimate populist fuel; the most economical and accessable of all renewable fuels, and regardless of what government does or doesn't do, homeowners will do what it takes to keep their families safe and warm. This is my company web site: This is the web site I run with a colleague: Since this is the oil drum, not the wood pile, you may want to contact me privately to discuss this further. I'd like to learn more about your dissertation.
I would be more than happy to see this discussion continue here as we need to discuss the full range of energy options available. If you would like to share your work with us as a guest post, I would be happy to host it (click on 'Stoneleigh' for my email address).

As a society, we can't pretend that people won't turn to wood if that's ever becomes the only way they can heat their homes. I already heat my farmhouse and hot water with an Empyre wood furnace, and also have an efficient fireplace insert and a 1928 wood range in my kitchen that I could cook on if I had to. I am currently fueling my furnace with some old barn boards and brush that I cleared away from behind my barns (a waste to energy scheme).

Have you done any work on wood -> biofuels?
Continuing this excursion off topic, BC, Alberta and Washington are up against a very serious problem with the mountain pine bark beetle. Huge areas in the centre of BC have close to 100% kill of lodgepole pine, the favoured host of this beetle. Over 4 million hectares of BC, that's about 10% of the province's total land area, have been classified as moderate to severe kill for lodgepole pine, a common species for decades in forest restocking. Any flight over BC where you can see the ground shows depressing masses of red, dead trees.

The trees have to be harvested within two years from death to be useable for lumber. The resulting salvage harvest in BC and Washington comes on top of what was already a North Amrican oversupply. In 2005, over 400 million cubic metres of wood in BC had been affected. Peak western lodgepole pine, for the rest of my life at least.

The few knowledgeable people I've spoken to about this chalk up the extent of the current outbreak to global warming (a tenuous attempt to get back on topic). Historically, the infestation cycle has been limited by deep cold snaps in BC's interior, but no more. The MPBB has crossed the Rockies and now threatens about 2 million hectares of lodgepole pine in western Alberta. An even larger issue is the risk it will get into the jack pine in Canada's boreal forest.  

Don't worry about being off-topic. Energy issues are intimately intertwined with economic and environmental issues, and Round-Up threads are open threads like Drumbeats in any case.
I agree.
Yes the beetle is a huge problem and the BC government would very much like a solution.  Optimal strategies would be biofuels and pellets IMO.
yes this is a serious problem, but it could also be a serious opportunity to make huge quantities of wood pellets out of all that dead wood and ship them around the world. I'm sure they would find a market in Europe, in the UK wood seems to be making a comeback as a secondary heat source (well, my brother just ripped out his gas fire and put in a fancy new Danish hi-efficiency stove!)

Apparently the BC government is planning to at least generate some electricity with the stuff, there are a few PDFs on their website:

If ever this beetle gets into the eastern Boreal forests, it would be a disaster, but we would have some serious wood to burn then ;-)

Back to oil.  Imperial's proposed Kearl project is under attack for GHG emissions. But the Province's energy regulator is denying it has the authority to take GHG emissions into account.

At a hearing of the Alberta Energy and Utilities Board in Fort McMurray Wednesday, the Pembina Institute, an Alberta-based environmental policy research organization, accused Imperial of neglecting climate change concerns in its proposed $5.5-billion Kearl oil sands development.

"They have absolutely no greenhouse gas management plan," Marlo Raynolds, the institute's executive director, said in an interview from Fort McMurray....

The Pembina Institute has asked the province's Energy and Utilities Board to deny Imperial a development permit based on its projected greenhouse gas emissions. But in approving Suncor Energy Inc.'s Voyageur project this week, the board ruled that it has no authority to deal with climate change issues, saying the provincial government has reserved that role for itself.