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Coal-to-liquid - July 30

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China Reins in Fast Growth of Coal-to-Liquid Fuel Projects

Wu Qi, Xinhua via Red Orbit
BEIJING -- China has raised the capital threshold for projects converting coal to liquid fuel to brake a possible overheating in the coal-chemical industry, as excessive development of the fossil fuel pollutes the environment and strains the water supply.

On July 7, the National Development and Reform Commission (NDRC), China's industrial watchdog, issued a circular requiring local governments to tighten control of new coal liquefaction projects before the national development program for the coal liquefaction industry is complete.

The government will not approve coal liquefaction projects with an annual production capacity under three million tons, said the Commission circular.

One ton of coal-to-oil processing capacity needs an investment of 10,000 yuan (1,250 U.S. dollars). Thus the three-million-ton annual capacity means an investment of 30 billion yuan, an astronomical figure for most enterprises, said Li Dadong, an academician with the Chinese Academy of Engineering
(29 July 2006)


Study: Coal-to-liquid plants future of U.S. energy

Ben Hillyer, The Natchez Democrat
NATCHEZ — America stands at a crossroads and for local leaders the roads cross in Adams County.

While officials from Natchez and Adams County were visiting the future coal-to-liquid plant in East Dubuque, Ill., officials from the Southern States Energy Board issued a study looking at the current energy situation in the America.

And by every measure, the report concludes that coal-to-liquid technology and other alternative energy resources are the key to America’s energy security.

The Southern States Energy Board is comprised of governors and state legislators from 16 states and two U.S. territories. Both Mississsippi Gov. Haley Barbour and Lousiana Gov. Kathleen Blanco are members of the board.

The group released the American Energy Study July 17 that presents a comprehensive plan for U.S. energy security through the production of ultra-clean fuels from domestic fuel sources. The goal of the study was to set an aggressive timeline for achieving complete energy independence by 2030.
(30 July 2006)
Does one detect the hand of the coal lobby in this promotion of coal-to-liquid? It is incumbent on newspapers to go beyond the press release to find out what the real story is. The following article provides a critical view. -BA


The Return Of Nazi Oil

Frank O'Donnell, TomPaine
Once upon a time, Hitler’s Nazis found themselves in a jam: how to fight a world war with meager oil reserves— especially after the debacle of the Russian Front and the loss of those former Soviet oil fields? The answer was to convert German coal into liquid fuel for the Luftwaffe and those Panzer tanks. (No, this plot line is not courtesy of Mel Brooks. In fact, General George Patton siphoned off some of this fuel from captured German vehicles and used it to race towards Germany in 1944.)

This expensive coal-to-liquid process was later used by South Africa to meet its energy needs during its isolation under apartheid.

And now what some people refer to as “Nazi fuel” is back—thanks in part to high oil prices and lobbying by groups that stand to profit its use in the United States. Former Republican congressman Bob Livingston was paid was paid more than $200,000 last year to lobby for federal loan guarantees for the North American branch of the South Africa-based Sasol corporation, which is trying to peddle this process.

Using this coal-to-liquid fuel is also an integral recommendation of a new report by the Southern States Energy Board, a collection of governors, state lawmakers and big polluters. They are trying to argue that their parochial interests—including promoting more coal mining—are synonymous with the national interest on energy issues.

But the fact is their interests are not the same as the American public’s interests—which is anxious for sustainable solutions to our dependence on oil.

In its relatively uncritical coverage, The New York Times described the SSEB report as “a crash program to meet fuel needs without imports… a strategy [that] could create more than one million new jobs, reduce the trade deficit by more than $600 billion, and end oil price shocks that hurt the economy.”

Whoa. Sounds good, but policymakers ought to be wary of being seduced by such hyperbole about groups like SSEB.

It’s not that everything the energy board has recommended is bad. In fact, some of their ideas—such as using more biomass and pumping carbon dioxide deep into oil fields to squeeze out more oil—do have merit.

But frankly it would make better public policy if Congress paid less attention to such self-interested private Ggroups like SSEB. The energy board’s “associate members” include a rogue’s gallery of some of the nation’s most odious polluters including American Electric Power, the Southern Company, and the TXU Corporation. Instead, lawmakers should listen to independent groups like NRDC and 20/20 Vision that are looking not just to reduce our dependence on foreign oil, but the bigger problem of our addiction to oil altogether.

For example, the energy board report left out perhaps the most effective way to cut down on oil use—better fuel economy standards. Then again, that wouldn’t bring in any cash for American Electric Power and the other heavy hitters.

These choices do matter, because going down the wrong path opens the door for unintended consequences.

For example, as my friends at NRDC have pointed out, unless the resulting carbon dioxide is stored underground, coal-based synthetic fuels can produce about double the greenhouse gas emissions of normal gasoline because it takes so much energy to convert the coal. (Pennsylvania is struggling to get one coal-to-liquid project off the ground. This one might have some merit—if they can capture and store the carbon—because it would eliminate some coal wastes that pollute the state’s waters.)

Or consider another recommendation of the energy board: to try extracting more oil from shale in such states as Wyoming, Colorado and Utah.

Some of us are old enough to remember the hype over the very same idea when Jimmy Carter was president, and we were concerned about unrest in the Middle East. In fact, Congress in that era created a Synthetic Fuels Corporation, backed by $20 billion in subsidies, aimed at squeezing oil from the shale. It’s generally been remembered as a classic boondoggle.

Repeating this boondoggle would, of course, be lucrative to some of the corporate members of the Southern States Energy Board, which are neither Southern nor states. But the Rand Corporation recently assessed some of the environmental impacts, which included more air pollution, more greenhouse gas emissions, disturbed land and threats to water quality.

Just another reason to avoid the déjà vu, and look for real solutions to our excessive and wasteful use of energy.

Frank O'Donnell is president of Clean Air Watch, a 501(c)3 nonpartisan, nonprofit organization aimed at educating the public about clean air and the need for an effective Clean Air Act.
(19 July 2006)
Good commentary - but is it really necessary to use the term "Nazi oil"? It's irrelevant and just muddies the waters. -BA

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