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The Dirty Secret

David Talbot, Technology Review (MIT)
Better technologies exist for extracting coal, a major source of carbon dioxide emissions. The challenge is getting people to adopt them.
Coal is the black sheep of the energy family. Uniquely abundant among the fossil fuels, it is also among the worst emitters of greenhouse gases. Mindful of coal’s bad reputation, President Bush promised the world three and half years ago that the United States would develop a superclean coal plant in an initiative known as FutureGen. The plant would have zero emissions; even the carbon dioxide it released would be pumped underground.

Today there is a patch of land in Great Bend, OH, where an advanced coal plant may one day be built. The plant could eventually include equipment for siphoning off carbon dioxide. But it’s not FutureGen, which today remains a collection of research projects. No FutureGen plant has been constructed, and no site for one has been chosen.

…integrated gasification combined-cycle (IGCC) is frequently referred to as a “new technology,” but it’s really a combination of two well-established technologies

…Indeed, coal gasification, developed about a century ago, has long been the technology of last resort for countries unable to gain access to oil. The Nazis used it to fuel the Luftwaffe; South Africa adopted it during apartheid. In North Dakota, a coal gasification plant went online in the early 1980s after the Arab oil embargo, later began capturing and selling its carbon dioxide for use in oil recovery, and is still humming today.

…What’s lacking is broad action to build such plants in significant numbers. Coal presents the world’s single largest opportunity for carbon dioxide mitigation. Coal consumption produces 37 percent of the world’s fossil-fuel-related emissions of carbon dioxide, the chief greenhouse gas. While oil consumption produces more — nearly 42 percent — much of that comes from cars, trucks, planes, and other means of transportation for which carbon dioxide capture is practically impossible.

…No clean coal technology can forestall climate change without the aid of carbon dioxide sequestration. Unless the carbon dioxide from coal-fired plants is permanently stored somewhere, it will go into the atmosphere and worsen global warming.

..After President Bush told the nation it was addicted to oil in the State of the Union address this year, he reeled off several clean-energy research ideas and said we were “on the threshold of incredible advances.” The implication seemed to be that we need these “incredible advances” before we can really get serious about replacing fossil fuels or dealing with climate concerns.

The reality is that we already have several good technological options. The question remains one of policy. No energy company will reduce carbon dioxide emissions unless carbon dioxide has a cost.
(19 July 2006)
Good article – comprehensive and balanced. -BA

Biofuels To Incite Grain Demand Shift

Dow Jones via Cattle Network
The burgeoning biofuels market is soon to spark a demand shift affecting grains and soy, one analyst said Tuesday at the Dow Jones Indexes-AIG Mid-Year commodity outlook event at the Chicago Board of Trade. “This is going to have a tremendous dislocation on grain demand,” said Dan Basse, President of AGResource Co.

…”I fear we’ll be ending up in somewhat of a food fight between the fuel industry and the food industry,” Basse said. He noted about two to three ethanol plants begin operation in the U.S. each month.

That will soon increase to eight to nine plants per month in the fourth quarter and into next year, Basse said. An investment gold rush into ethanol industry was prompted by crude oil prices of up to $60-$70 per gallon last fall, he said.

“This agricultural revolution is not only in the U.S.,” Basse said. “The biodeisel demand coming out of Europe is just astronomical.” He noted several other examples, including China, which announced last week it would grant $200 billion to develop biofuel-capable infrastructure within 20 years, expecting 5% of its fuel to be bio-derived.

He also mentioned Canada, which announced a 5% biofuel program; Malaysia and Indonesia are using 20% of their palm oil for biodeisel; and the European Union and Brazil are also large producers of biodiesel.

“From here forward, we have to produce record-large global corn crops if we’re going to keep up with demand,” he said. The USDA estimates 91 million metric tons of corn are in world storage, the lowest stockpile since since 1984.
(18 July 2006)

Big Oil’s pain
(high production costs)

Steve Hargreaves, CNNMoney
While record prices have produced record profits, they have also helped make crude a lot more expensive to pump.
Thanks to record oil prices spurring an exploration boom and a cyclical industry woefully unprepared to meet its labor needs, the cost to produce a barrel of oil has skyrocketed in recent years.

Between 2001 and 2004, the average costs to operate a land-based oil well in the U.S. nearly tripled, according to figures from the Energy Information Administration and supplied by the Independent Petroleum Association of America, an industry trade group.

And Exxon Mobil (Charts) said industry wide development costs soared nearly 30 percent from the first quarter 2005 to the first quarter 2006.

While there is little sympathy among the public for companies that are posting record profits amid prices that have more than tripled since 2002, and little concern from investors as well, it’s an often overlooked component to high oil prices that has many in the industry worried.
(18 July 2006)