" />
Building a world of
resilient communities.



Reducing DoD fossil-fuel dependence

[Excerpts from a recently released report for the Director of Defense Research & Engineering (DDR&E). A number of prominent scientist are on the list of contributors.]


In light of an increasing U.S. dependence on foreign oil, as well as rising fuel costs for the U.S. and the DoD, and implications with regard to national security and national defense, JASON was charged in 2006 by the DDR&E to assessing pathways to reduce DoD’s dependence on fossil fuels.

The key conclusions of the study are that, barring unforeseen circumstances, availability concerns are not a decision driver in the reduction of DoD fossil-fuel use at present. However, the need to improve logistics requirements and military capabilities, and, secondarily, the need to reduce fuel costs, as well as providing a prudent hedge against a foggy future, especially in the Middle East and South America, argue for a reduction in fuel use, in general.

Executive summary

In light of an increasing U.S. dependence on foreign oil, as well as rising fuel costs for the U.S. and the DoD, and implications with regard to national security and national defense, the JASONs were charged in 2006 by the DDR&E with assessing pathways to reduce DoD’s dependence on fossil fuels.

The study charge included the following tasks:

  1. Explore technology options to reduce the DoD dependence on fossil fuels and/or increase energy efficiency of our operating forces. This assessment will include an assessment of alternative fuels and energy sources at DoD-required energy densities, e.g., exotic alternate fuels, biomass/cellulosic biofuels, hydrogen, shale oil, oil sands, geothermal, etc., and an assessment of the potential of structural shaping, structural mechanical design, and novel materials application in enhancing the survivability of lightweight vehicles.

  2. Assess the viability of technologies to provide at least the performance required of current DoD platforms and effort to integrate the technology and achieve the desired level of performance. In particular, alternate fuels and energy sources are to be assessed in terms of multiple parameters, to include (but not limited to) stability, high & low temperature properties, water affinity, storage & handling.
  3. Assess blast and penetration resistance in lightweight vehicles.
  4. Analyze structures and materials designs that could be adapted for use on combat and utility vehicles, or other DoD platforms.
  5. In addition, JASON was asked to defer detailed analyses of USAF energy/fuel use.

Some key findings and recommendations are summarized below.

  1. Based on proven reserves, estimated resources, and the rate of discovery of new resources, no extended world-wide shortage of fossil-fuel production is reasonably expected over, approximately, the next 25 years.

    While the possibility of shortterm shortages of refined gasoline or diesel product exists, depending on domestic refining capacity relative to domestic petroleum demand, there is not a strong basis to anticipate sustained global shortages of crude oil in the next 25 year (or more) time frame. In addition, there is no basis to anticipate shortages in petroleum available to the DoD, especially considering that present DoD fuel consumption is less than 2% of the total U.S. domestic fuel consumption – a demand that can be met by only a few domestic supply sources, at present – even though likely decreases in domestic-oil production will make the future domestic-coverage margin smaller. This finding is premised on the assumption of no major upheavals in the world, in general, and in the major oil-producing nations and regions, and oil-transportation corridors, in particular, over the next 25-year period.

  2. The 2006 DoD fossil-fuel budget is, approximately, 2.5-3% of the national-defense budget, the range dependent on what is chosen as the total national-defense budget.

    Larger (percentage) fuel costs are borne by families and many businesses, for example, and fuel costs have only relatively recently become noticeable to the DoD.

  3. At present, there is a large spread between oil-production cost and crude-oil prices. Many projections, however, including that of the U.S. Energy Information Agency, indicate that crude oil prices may well decrease to $40-$50/barrel within the next few years, as production and refining capacity increases to match demand.
  4. DoD is not a sufficiently large customer to drive the domestic market for demand and consumption of fossil fuel alternatives, or to drive fuel and transportation technology developments, in general. Barring externalities, e.g., subsidies, governmental and departmental directives, etc., non-fossil-derived fuels are not likely to play a significant role in the next 25 years.
  5. DoD fuel consumption constraints and patterns of use do not align well with those of the commercial sector. Most commercial-sector fuel use, for example, is in ground transportation, with only 4% of domestic petroleum consumption used for aviation. In contrast, almost 60% of DoD fuel use is by the Air Force, with additional fuel used in DoD aviation if Naval aviation consumption is included. Options for refueling ships at sea are more limited (or nonexistent) compared to those for commercial vehicles in urban areas. Options for DoD use of electrical energy on ground vehicles are limited, since one can not expect to plug into the grid in hostile territory, for example, to refuel/recharge an electric vehicle. Furthermore, drive cycles for DoD ground vehicles differ significantly from EPA drive cycles that, as a consequence, provide poor standards for fuel consumption.
  6. Even though fuel is only a relatively small fraction of the total DoD budget, there are several compelling reasons to minimize DoD fuel use:
    1. Fuel costs represent a large fraction of the 40-50 year life-cycle costs of mobility aircraft and non-nuclear ships. Note that this is consistent with the life-cycle costs of commercial airliners.
    2. Fuel use is characterized by large multipliers and co-factors: at the simplest level, it takes fuel to deliver fuel.
    3. Fuel use imposes large logistical burdens, operational constraints and liabilities, and vulnerabilities: otherwise capable offensive forces can be countered by attacking more-vulnerable logistical-supply chains. Part of this is because of changes in military doctrine. In the past, we used to talk of the “front line”, because we used to talk of the line that was sweeping ahead, leaving relatively safe terrain behind. This is no longer true. The rear is now vulnerable, especially the fuel supply line.
    4. There are anticipated, and some already imposed, environmental regulations and constraints.
    5. (Not least, because of the long life of many DoD systems) uncertainties about an unpredictable future make it advisable to decrease DoD fuel use to minimize exposure and vulnerability to potential unforeseen disruptions in world and domestic supply.

The JASONs conclude that the greatest leverage in reducing the DoD dependence on fossil fuel is through an optimization of patterns of use, e.g., planning and gaming, as well as the development of in-situ optimization tools of fuel use that would help planners and field officers choose between operational scenarios to minimize logistical support requirements by minimizing fuel consumption. Such tools for planning and for conducting operations could evolve and improve tactics, and enable significant reductions in fuel consumption, while improving military effectiveness at the same time.

The JASONs noted that little or no hard data are available on fuel consumption at the level of individual vehicles and vehicle types. Instrumenting an adequate fraction of vehicles with the equivalent of commercially available telemetry/logging vehiclemonitoring systems for fuel consumption, vehicle speed, acceleration, etc., e.g., equivalent to the GM “On-star” system, or the real-time fuel monitoring systems as in the Toyota Prius, Honda Accord, etc., would yield valuable database information and help establish realistic baselines against which vehicle mix and operational choices can be optimized with an eye towards fuel consumption. Large fuel savings could potentially be achieved by considering and optimizing the unmanned platforms and systems to replace functionality of manned platforms and systems.

Other areas with high leverage, in order of importance, include:

  1. Optimization of engine types for DoD missions and use patterns. Commercial hybrids are not optimized to DoD use patterns. Re-engine the M1A1 and M1A2 tanks, HMMWVs, B-52 bombers, etc. with modern engines designed and optimized for their pattern of use.

  2. Lightweighting vehicles costs money but can return significant fuel savings and other benefits. The greatest potential weight savings are not in armor, but in design, structural materials, and components of the vehicle drive system, radiator, etc.

Alternative fossil-fuel derived fuels, e.g., Fisher-Tropsch liquid fuels from coal, etc., are more costly and less energy efficient than fuels produced by refining crude oil. If crude oil sources are, for some reason, not indicated, the next most-cost-effective method to achieve assured domestic fuels is Fisher-Tropsch on stranded natural gas, such as in Alaska, albeit with attendant Greenhouse Gas (GHG) emission burdens, unless carbonsequestration measures are employed and prove efficacious and cost-effective. No scaleable biomass processes today can yield DoD-suitable fuels.

The key conclusions of the study are that, barring unforeseen circumstances, availability concerns are not a decision driver in the reduction of DoD fossil-fuel use at present. However, the need to improve logistics requirements and military capabilities, and, secondarily, the need to reduce fuel costs, as well as providing a prudent hedge against a foggy future, especially in the Middle East and South America, argue for a reduction in fuel use, in general.

We conclude by recommending that a more-in-depth analysis be undertaken that would consider future possibilities and scenarios that could invalidate these findings by altering the basic premise of no major upheavals in the next quarter-century, and the consequences to the DoD, indeed, to the nation, should such upheavals occur


Global, domestic, and DoD fossil-fuel supply and demand

A. Global fossil energy perspective

The present situation is assessed with respect to known, so-called “proven”, reserves and resources of fossil energy, globally. As indicated in the left figure on page 4, the world has approximately 41 years of proven reserves at this time, if the 2005 consumption rate is maintained. Less, of course, is assured if consumption increases. The inference, however, should not be drawn that the world will run out of oil in 40 years, or so. The world increased its oil reserves from somewhat beyond 30 years to over 40 years (reserves-toproduction ratio), following the events in the early 1980s in the Middle East, in spite of substantial increases in total consumption.[1 - BP Statistical Review of World Energy (January 2006, page 10)] Oil producers will not invest to secure reserves on a time scale longer than ~40 years. The net present value of such an investment would be small compared to the (cost of) capital required to explore and prove such additional reserves.

On the other hand, the data also indicate that present U.S. oil reserves, extracted at present production rates, will be depleted in the next 12 years. Whether this will be altered by new domestic discoveries during this period depends not only on whether they exist within the U.S., but also on whether the production cost differential between foreign oil sources and potential future U.S. resources warrants economic domestic production.

As indicated on the right, most conventional proven oil resources/reserves are concentrated in the Middle East. North America has relatively little of the world’s proven oil reserves and resources, but has 30% of the world’s unconventional oil resources, e.g., tar sands, shale, etc.

Oil available depends on the amount one is willing to pay to extract it from the ground and, ultimately, the amount remaining in the ground. Cumulative global crude oil production through the 20th century to the present accounts for approximately one trillion barrels (Tbbl = 1012 bbl) of oil [2 The abbreviation ‘bbl’ stems from ‘blue barrel of oil’ that denotes the color of standard containers in the past that held 42 (U.S.) gallons.].

In the compilation depicted in the figures on page 6, the following assumptions are incorporated.

  • All Middle East oil (proven and yet to be proved or discovered) is inexpensive to extract.
  • Other proven reserves are below $20/barrel by definition; a good portion of “reserve growth” and undiscovered oil will cost less then $25/barrel, according to evolving technology.
  • Deepwater will deliver 100 Bbbl at $20-35/bbl.
  • Arctic areas can deliver 200 Bbbl at $20-60/bbl.
  • Super-deep reservoirs will represent a small and relatively expensive oil contributor (they contain mostly gas). • Enhanced Oil Recovery (EOR) can deliver 300 Bbbl above what is contained in the USGS reserve growth estimates, but some will remain quite expensive.
  • Non-conventional heavy oil has a large potential (some 1000 Bbbl between deposits in Canada, Venezuela and other countries) at $20-40/bbl, including CO2 and environmental-mitigation costs, e.g., carbon capture and storage (CCS) measures.
  • Oil shales become economical at $25/bbl and a significant portion of those resources can be exploited at less than $70/bbl, including CO2 and environmental-mitigation costs.


VII. Findings

In this section we summarize the key findings of the JASON study, broken down into key categories:

A. Global, domestic, and DoD fossil-fuel supplies

Oil is a worldwide-fungible commodity. Consistent with global proven reserves, no DoD fossil-fuel supply shortages are expected in the next 25 years. Although as much oil is projected to be needed in the next 25 years as the total already produced to date, world proven reserves are capable of accommodating this demand at less than $30/bbl production cost.

JASON emphasizes that this finding is premised on the assumption of no major world-wide upheavals, or political and other changes in the primary oil and natural-gas production regions of the world that supply the U.S., notably, the Middle East, Venezuela, and Russia, or other events and developments that may compromise the security of major fossil-fuel feedstock routes and transportation corridors (cf. figure on page iv of this report). Such upheavals have occurred in the past producing major changes in the world-wide availability and pricing of fossil-fuel resources, as documented for the period around 1980 in the graphics on pages 10 and 61, following the Iranian revolution and its consequences on the Middle East and the world.

Present oil prices on the spot market are high relative to production costs. Production costs are compounded with other factors to yield these high market prices, the difference reflects the market’s confidence in assured future supplies, imbalances between supply and demand, and, not least, the profits that the market is willing to bear. On the other side of the fulcrum, however, JASON notes that while short-term response options to oil price increases are limited, longer-term options are not inconsiderable, as every dollar increase in world market prices invite additional fossil-fuel sources to join the world mix, as well as non-fossil energy sources to become economical. The oil-producing nations are quite conscious of this balance. Saudi Arabia, in particular, has used its reserve production capacity for the last few decades to dampen both rapid increases and decreases in oil prices.

Future oil prices are difficult to predict, especially in dollardenominated terms, the latter hedge as a consequence of the significant U.S. current-account imbalance depicted in the inset graphic on page 78.

At present, the working assumption of the energy industry, as documented in EIA assessments, is that the market price of oil will return to a $40-45/bbl range in the next five years, as increased production facilities come on line, accommodating increases in demand.

Thus, increasing U.S. imports relative to domestic supply have no direct national-defense implications, other than financial. They do, however, impose clear balance-of-payments and national-economy consequences, and significant indirect national-security implications thereby. Strong defense is and has historically always been predicated on a strong economy.

The study notes that a reduction of 12% in U.S. oil consumption, at present, would relax the world-wide tight supply-demand situation, at least for a while, and allow the U.S. the option of foregoing all oil imports from the Middle East and avoidance of the dependencies and vulnerabilities imposed by this sensitive import stream, should the need arise.

B. DoD fuel costs

DoD fuel costs have become visible only relatively recently. Even at present, they represent only 2.5-3% of the nationaldefense budget, the spread depending on what is chosen as the denominator for total national-defense costs. While uncertainties and the recent large increase in fuel costs present DoD budget planners with formidable challenges, representing a (much-larger) fraction of non-fixed (“discretionary”) spending, JASON must conclude that fuel costs, per se, while not negligible, cannot be regarded as a primary decision driver, at present.

The largest fraction (~ 62%) of DoD fuel use is expended in CONUS. Continuous progress has been made by DoD in recent years to decrease energy and fuel use. However, because weapons systems have very long life-cycles, fuel represents a significant fraction of life-cycle costs for U.S. Air Force mobility carriers (~ 40%) and conventionally fueled Navy ships (~ 30%). JASON also notes that expected reductions in the U.S. Air Force tactical inventory (number and type of aircraft on active duty), as discussed on pages 76 and 77, will, perforce, decrease future consumption of aviation fuel, which represents the largest single DoD fuel-use component.

DoD fuel use is subject to complex interrelated governmental and congressional regulations, as well as foreign and domestic policies and directives. These inject externalities that complicate bookkeeping and often hamper proper DoD fuel-use optimization.

JASON finds compelling reasons for the DoD to minimize fuel use, both overall and in individual vehicles and carriers. Fuel, even if it is currently a relatively small portion of the overall budget is accompanied by large multipliers – it takes fuel to deliver fuel – and is accompanied by high costs in both infrastructure (O&M) and, in the battlefield, in lives.

Price uncertainties compound budget planning, and fuel costs may rise to represent a more-significant factor for the DoD in the future, even though current projections may indicate otherwise. More importantly, the impacts of delivering fuel are evident in dictating tactics, operations costs, maintenance costs, and military capabilities.

C. Decreasing DoD fuel use

Hybrid vehicles are optimized for intermittent/stop and go use patterns with fuel-consumption benefits that are anticipated in that driving environment. Hybrid vehicles offer little or no fuel-economy benefits if the average power expended is close to the peak-power capability of the powerplant.

Hence, hybrids offer much more fuel consumption savings in the commercial sector than in the typical DoD (Army) pattern of vehicle use. JASON finds no significant foreseeable DoD role for allelectric vehicles. These vehicles have possible applications in the limit of short-range, low-friction terrain, if the vehicles are very light weight, and for special-purpose missions such as robotic vehicles. Most of these applications are outside (current) DoD patterns of use.

Similarly, JASON sees no significant DoD use for fuel-cell vehicles on any reasonable time horizon. These vehicles are very costly and the technology is not mature. We also do not see a good mechanism by which the fuel to power them could be supplied to theater. As such, JASON does not anticipate that they will play a role in DoD tactical or combat vehicles in the foreseeable future.

JASON believes that there can be revolutionary changes in the use of unmanned vehicles, especially aircraft, if the design space is explored to optimize fuel efficiency and endurance. Such vehicles would improve fuel efficiency and add new capabilities, potentially obviating air-to-air refueling in many instances. Future special-use robotic vehicles can play an important role by saving lives and fuel. This is true for air, sea, and for land (cf. JSR-01-225).

In general, light-weighting costs money, but can in return save fuel and will enhance military capability.

Finally, modern diesel engines offer large increases in fuel consumption relative to turbines or older diesel engines that are very inefficient, especially at idle, or near-idle conditions.

D. Liquid fuels from coal or natural gas

DoD is not a large enough customer to drive the fuel market or to drive future developments in alternative fuels. Accounting for less than 2% of U.S. fuel consumption, DoD is likely to depend on the world-wide and commercial sectors for its supplies and alternative fuels are a world-wide issue.

Liquid fuels from stranded natural gas provide the economically and environmentally most-favorable alternative to fuels from crude oil. Underground coal gasification (UCG) provides the next-best alternative from an economic perspective, but is only acceptable from an environmental perspective if GHG emissions (mostly CO2) from the fuel production process are sequestered.

E. Biofuels

Presently, liquid fuel from biomass processes do not compete economically with production of fuel from crude oil.

Biofuels provide little, if any, net energy benefit, especially if the complete process is taken into account, and are not economically competitive (without subsidies) with other uses of agricultural land, e.g., growing food.

Current biomass-to-fuel methods of production present a significant environmental burden (GHGs, soil depletion and erosion, waste water, etc.).

Fuel processes based on cellulosic ethanol, butanol, etc. could eventually provide a significant fraction of the fuel demands of the U.S., if they are proven economically viable and if associated environmental burdens are acceptable. Such processes do not exist at present, however, and neither they, nor other non-ethanol biofuels and biofuels processes can be assessed, either in terms of their economics or environmental ramifications, at this time.

The biofuels community must demonstrate sustainability with respect to soil depletion/erosion, waste water, and other related considerations, and they must demonstrate that such methods are also preferred environmentally, i.e., through a Well-To- Wheels analysis, if it is to be argued that they can provide a sensible alternative to fossil-derived fuels.

Ethanol’s low energy density, high flammability, and transportation difficulties, relative to diesel and JP-8, for example, render it unsuitable as a DoD fuel. The primary considerations that enter this finding are logistics, energy density (high volume per unit energy content), and safety.


Editorial Notes: The original document is a 105-page PDF. It is unclassified and approved for public release. The section with the reasons for the group's rosy forecast of oil production appears on pages 4-13 of the report. It does not seem as rigorous as the rest of the report. A rough summary might be:
Take proven oil reserves, divide by the 2005 consumption rate, and you get 41 years. However, if the long-term price of oil is perceived to be at a high level, other resources will be exploited and we will not run out of oil in the next 40 years. Political turmoil would complicate matters.
The agency which requested the report is the Director of Defense Research & Engineering The group authoring the report is JASON:
JASON is an independent scientific advisory group that provides consulting services to the U.S. government on matters of defense science and technology. It was established in 1960. JASON typically performs most of its work during an annual summer study, and has conducted studies under contract to the Department of Defense (frequently DARPA and the U.S. Navy), the Department of Energy, the U.S. Intelligence Community, and the FBI. Approximately half of the resulting JASON reports are unclassified.

What do you think? Leave a comment below.

Sign up for regular Resilience bulletins direct to your email.

Take action!  

Make connections via our GROUPS page.
Start your own projects. See our RESOURCES page.
Help build resilience. DONATE NOW.

Why Peak Oil Refuses to Die

Peak oil and climate change are two sides of the same coin. The coin itself …

Peak Oil Review - Sept 1

A weekly review including: Oil and the Global Economy, The Middle East & …

A Big Summer Story You Missed: Soaring Oil Debt

Last July the government agency, which has collected mundane statistics on …

Global Biofuels Status Update

Today I want to take a deep look at the global biofuels picture, drawing …

Peak oil notes - August 28

A mid-week update. Oil prices have been quiet this week trading around the …

Update on US natural gas, coal, nuclear, renewables

On August 6, I wrote a post called Making Sense of the US Oil Story, in …

The Peak Oil Crisis: When?

 The key question is just how many more months or years will production …