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General: Dependence on oil a ‘serious’ national security threat

With gasoline prices at five-year lows, it’s easy to lose sight of the realities of U.S. dependence on oil. We’re still beholden to other nations for much of our supply; we still have to expend much energy and resources defending the free flow of oil around the world; and we still need the long-term solution of alternative fuels to keep prices low.

One person who’s done a lot of thinking about this is retired U.S. Air Force Gen. Ronald Keys, who lays out the argument for reducing our consumption of oil in a guest piece for The Hill. Keys, who spent 40 years in the Air Force (and flew combat missions in Vietnam), is now chairman of the Military Advisory Board at the CNA Corporation, a nonprofit military research group.

Keys writes:

Our nation’s over dependence on oil is a serious threat to our national security—militarily, diplomatically, and economically. It limits our ability to act on the world stage and increases the likelihood that we will send Americans in uniform into harm’s way. It leaves us open to impacts from wildly gyrating prices …

And:

Importing less oil will loosen the bonds that tie us to regimes that don’t always have our nation’s best interests at heart. That will make it easier for the United States to act in its own national interest on the world stage, and make it less likely that we will have to send troops to defend the free flow of oil.

And:

Oil prices will always fluctuate, but the need to cut our nation’s oil dependency will endure. This need doesn’t get any less urgent just because pump prices tick downwards for a while.

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PUMP – How, When and Why to End Our Oil Reliance

PUMP is an eye-opening documentary that tells the story of America’s addiction to oil, from its corporate conspiracy beginnings to its current monopoly today, and explains clearly and simply how we can end it and finally win choice at the pump. This film is well researched and easy to understand. The directors, Joshua and Rebecca Tickell won a Sundance award for their 2008 documentary Fuel. 

Read more at: Working Mother

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PUMP – Special Screening with Q&A presented by Fuel Freedom Foundation

The Frida Cinema in Santa Ana is proud to bring you an eye-opening investigation into the United States’ problematic love affair with fossil fuels. Husband and wife team Joshua and Rebecca Harrell Tickell’s Pump is an exciting presentation of both long- and short-term solutions to our nation’s current oil addiction. The film seeks to explore what real individuals can do to make necessary change in their communities, approaching issues from the level of real human beings.

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What are flex-fuel vehicles?

At the beginning of the long, winding road away from complete dependence on gasoline lies the holy grail of the flex-fuel vehicle.

This would be a car that runs on any fuel at any time. That would include gasoline, ethanol, methanol, propane, hydrogen or any of the emerging fuels. The most common U.S. variety is E85, a mixture of 15 percent gasoline and 85 percent ethanol. In China there are blends of up to 100 percent methanol (the highest legal blend in the U.S. is M85). Ethanol could come from a variety of sources including corn ethanol, cellulosic ethanol (if current experiments prove successful) or any combination thereof, but also from natural gas. Methanol is currently produced in the U.S. from natural gas, but can be produced from a variety of bio resources like municipal waste. Methanol and ethanol can be mixed anywhere up to 85 percent with gasoline. The reason a small amount of gasoline remains in the fuel is to allow cars to start on cold mornings. Flex-fuel vehicles running on 100 percent alcohol fuels have trouble starting below 52 degrees. In Sweden there are special blends of E75 that are sold all winter.

The difference is that with flex fuels all these different substances can go in the same tank. There is no need for separate compartments — the on-board computer senses which combination is being offered and adjusts accordingly. This differentiates flex-fuel from several contemporary vehicles where there are two tanks and the driver has to keep switching back and forth.

The place where flex-fuel vehicles have made the most progress is in Brazil, which decided, after the second fuel price crisis, that it would not depend on oil anymore. Brazil now has a total of 17 million flex-fuel vehicles on the road, 63 percent of the total, with 2.7 million added last year. Almost all of Brazil’s ethanol comes from sugar cane, but some is imported from the U.S. The key in Brazil is that every gasoline station has to offer the two fuels — gasoline and ethanol. The result is permanent competition at the pump. The result is that about 50 percent of the fuel consumption is now ethanol and gasoline and ethanol prices have been declining for the past decade.

In Europe, Sweden now has 250,000 flex-fuel vehicles on the road, about 70 percent of the European total. The growth is the result of Sweden’s National Climate in Global Cooperation Bill, which signed the Kyoto Protocol and vowed to free Sweden from fossil fuels by 2020. Sweden also has the largest number of flex-fuel filling stations in Europe: 1,750.

The great irony is that America has 17. 5 million flex-fuel vehicles on the road today, more than any other country, but people are hardly aware of them. Since 2008 automakers have been marking flex-fuel capability with a yellow gas cap, and most auto companies also have a sticker they put somewhere on the rear end. A good mechanic can make all the necessary computer adjustments for fewer than $200 to convert most of the cars on the road to be flex-fuel cars. However, except for the Midwest, where ethanol is popular, there are very few flex-fuel gas stations available,

One perk of E85 is that most cars on the road can take advantage of the higher octane of E85, and, as a result, get 90 percent (or even higher) better mileage that when using gasoline. Another great advantage of flex fuel is reduced engine knock. In fact, ethanol is used today in gasoline as an anti-knock agency. E85 would work even better. There is also a general agreement that because ethanol is highly oxygenated and burns cleaner it is better for the environment. A 2007 study by Argonne National Laboratory found that life-cycle analysis for greenhouse gases from ethanol to be 19-52 percent lower than gasoline.

The advantages of flexible-fuel vehicles are manifold. It’s just a question of the inertia of getting people to change over in a fleet of 250 million cars.

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“Pump” makes the case for Fuel Freedom

Fuel Freedom opened up a new front in making the case for alternatives to gasoline with an 88-minute documentary called “Pump,” which was released in New York, Los Angeles, and Salt Lake City on Sept. 19 and will continue to open in theaters across the country.

The documentary addresses one of the many interesting things in the long history of the automobile and how it became dependent on gasoline instead of other fuels, which involves Henry Ford. Ford, the inventor of the Model T, wanted his cars to run on ethanol, because he felt it was a better fuel. But John D. Rockefeller was putting money behind the Prohibition effort — not to keep Americans sober, but to keep alcohol out of cars. Even more compelling is the ongoing argument concerning the number of available alternative fuels and yet we are somehow locked into one alternative: gasoline.

“We’ve all seen the story about oil and the environment,” said Eyal Aronoff, co-founder of Fuel Freedom and one of the movie’s producers. “But we feel there is a story that hasn’t been told [about] the economic impact of oil and how [with the] technology that we have today — if we have the willpower and the wherewithal — we can start the process of breaking the addiction.”

Americans use 18 million barrels of oil a day, and about 33% of that oil is imported. This has given a sense of overwhelming confidence. But what few people realize is that we pay virtually the same to import 33% of our oil as we did when we were importing 60%. This is because the price has not changed significantly — although it has leveled off because world demand has risen to meet America’s energy boom.

But many experts believe Americans can do much better. John Hofmeister, former president of Shell Oil and founder of the nonprofit group Citizens for Affordable Energy; Peter Goldmark, former president of the Rockefeller Foundation and former program director at the Environmental Defense Fund; various spokespeople for General Motors; the Natural Resources Defense Council; and others are all in agreement. “Pump” features an in-depth interview with former Brazilian President Luiz Inácio Lula da Silva, who is credited with transitioning the world’s seventh largest economy to homegrown fuel made from sugar cane. Also giving an extensive interview is Elon Musk, whose electric Tesla may transform the entire auto industry.

One of the favorite strategies presented in the documentary is the flex-fuel engine where, with only a few simple adjustments, cars can run on any of up to seven fuels, including all varieties of gasoline, ethanol, methanol, any mixture of the two, or compressed or liquefied natural gas.

“When you have competition, you have innovation. And when you have innovation, you have disruption. What floats to the top is usually something that’s better, faster, cheaper and easier,” said Aronoff, who spent three years developing the film. All that work may prove to be worth the effort.

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Budweiser trades Clydesdales for natural gas

The famous Clydesdales that have hauled Budweiser’s barrels of beer since the 19th century are finally being replaced by 21st century compressed natural gas-driven vehicles.

Well, it isn’t quite that simple. There’s been an 80-year interval between the 19th and 21st centuries, when Budweiser’s trucks ran on gasoline and diesel fuel. But for 66 trucks at Budweiser’s Houston brewery, the 53-foot trailers loaded with 50,000 pounds are now going to be hauled by trailers running on compressed natural gas.

Anheuser-Busch actually has plans to convert its entire fleet to natural gas, according to James Sembrot, senior transportation director. “It’s significant that A-B feels comfortable swapping for an entire fleet that runs on CNG,” Christopher Helman wrote in Forbes. According to Sembrot, “the intention of shifting to natgas…is to reduce carbon emissions and fuel costs, while doing something green(ish).”

“The Houston brewery is among the biggest of the 14 that A-B operates nationwide. The closest breweries to this one are in Fort Collins, Colo., and St. Louis. Each truck rolls virtually around the clock — traveling in an average of 140,000 miles in a single year hauling beer to wholesalers. They move 17 million barrels of beer each year.” That’s a lot of beer running on natural gas.

Actually, it’s not Anheuser-Busch that is taking the initiative on Budweiser. The natural gas vehicles are being made available through Ryder, the nation’s largest trucking company since merging with Budget Truck Rental in 2002. Budget now has 2,800 businesses and 132,000 trucks around the country. Although only a small percentage run on natural gas, the company is dedicated to converting its fleet with all due dispatch, and the savings may prove to be extraordinary. According to Helman, “Sembrot tells me that the old trucks were getting 6.2 miles per gallon of diesel and running 140,000 miles per year. That equates to 1.45 million gallons of diesel to go 9.2 million miles. At about $3.80 per gallon, that’s roughly $5.5 million in total diesel costs per year. If they save about 30 percent per ‘gallon equivalent’ when buying CNG, that’s a savings of about $1.65 million per year.” That’s a lot of money save for switching to natural gas.

But it’s not just Budweiser and Ryder and a few forward-looking companies that are pushing ahead with natural-gas vehicles. The whole state of Texas seems to have gotten the bug. The Lone Star State now has 106 CNG filling stations, the most in the country. Forty are them are open to the public, while the others are fleet vehicles where vehicles from Anheuser-Busch and Ryder can fill up. Actually, far ahead of these innovators are FedEx and UPS, which have not converted their fleets for many years. And hovering in the background is T. Boone Pickens and his “hydrogen highway,” which is installing huge natural gas depots at key truck stops along the Interstate system. Much of this is aimed at Texas and the first complete link has joined San Diego to Austin in a seamless string of stations that will allow tractor-trailers to make the whole trip on natural gas.

All this has done wonders for Texas tax collections. At the start of the year, the Texas Controller’ Office was anticipating revenues less than $ million from excise taxes. Yet by July 31, 2014, collections were 220 times of that anticipated, and the Texas Controller’s office had collected $2,178,199. “These collections are more than double the estimated amount,” said David Porter, Texas Railroad Commissioner. “At 15 cents per gallon equivalent, $2 of motor fuels tax equals sales of 14,521,326 gallon equivalents of natural gas.”

Texas may be famous for fracking and producing more oil than Iraq, but they do not hesitate to look for new uses for gas and oil as well.

 

Photo by by Paul Keleher from Mass, US.

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Natural gas vehicles take the halfway route

In the early 1990s, California tried to force the introduction of electric cars by requiring that auto companies produce a zero-emissions vehicle in order to remain in the state. The result was Chevrolet’s EV1, which everyone agreed was the best electrical vehicle that could be built at the time. Owners loved them, but somehow the effort didn’t take off.

The infrastructure simply wasn’t in place. The car only had a 70-mile range and drivers spent much of their time worrying about their next charge. Many EV1s ended up on the lots of rental agencies where they attracted little attention. All this, of course, was interpreted by some people as the fault of the oil companies and the auto industry, which didn’t push the case hard enough. The award-winning documentary “Who Killed the Electric Car?” made this argument.

Then three years later, Toyota introduced the Prius, a gas-electric hybrid that gave drivers some breathing room. It was a spectacular success. By not trying to make the technological transition in one giant leap, the Prius introduced drivers to the advantages of electric propulsion without asking them to sacrifice anything in terms of a nerve-wracking search for a refill. In fact, when Toyota brought out the Prius it deliberately left off a home charger so that buyers would not associate it with the failed EV1. Not until several years later did the company release a plug-in hybrid. In both cases, the Prius has been the most successful of all hybrids.

Natural gas vehicles seem determined to avoid the same mistake. This year both Ford and General Motors are releasing commercial NGVs in their light-truck and sedan lines. But they are taking care to make them bi-fuel vehicles that run on both gasoline and natural gas, although they are expensive. (Both companies have been making tri-fuel — gasoline, ethanol and CNG — for many years in Brazil.) 

First out of the box will be the immensely popular Chevrolet Silverado and the GMC Sierra, both full-sized pickups that sold 480,000 and 184,000 last year, respectively, the highest sales mark since 2007. GM is offering bi-fuel versions for every cabin configuration. The 2015 model will offer a 16-gallon gasoline tank and a 17-gallon-equivalent compressed natural gas tank. When both are filled, the truck will have a remarkable range of 650 miles.

Along with that, GM will be releasing a bi-fuel Chevrolet Impala to introduce ordinary drivers to the advantages of natural gas. The Impala will feature an 18.5-gallon gasoline tank and a 7.7-GGE CNG tank. The result will be a 500-mile range.

Not to be outdone, Ford has already introduced a bi-fuel version of the immensely successful F-150 half-ton pickup truck. Released only last November, the company managed to sell 15,000 vehicles across eight models in 2013. That beat 2012 sales by 25 percent. When combined with its conventional gas tank, the CNG boost gives the F-150 an astounding 700-mile range, beating the Silverado by 100 miles. Unfortunately, the price differential for all these NGV models will be about $10,000.

But motorists could see a 2-3-year payback if the price gap between gasoline and its natural gas equivalent holds up. Right now it has settled around $1.50 gap per gallon and has remained there for almost five years. Give motorists the opportunity to save almost half the price on a gallon of gas is bound to make the new bi-fuel models more attractive.

Other developments are also moving in the direction of a transition to natural gas for high mileage vehicles. In 2012, ARPA-E, the federal government’s program for advanced energy research, awarded $2.3 million to GE Global Research, Chart Industries and the University of Missouri to design a gas refueling station for homeowners. GE already makes a $5,000 medium-sized refueling kit for commercial businesses called “CNG in a Box” that takes gas out of the utility pipes and compresses it for fleet vehicles. The target price for the scaled-down homeowner version is $500. The consortium has set a release date for later this year, at which point we’ll find out if they’ve been successful. The launching of such a cheap conversion system that would allow homeowners to tap the natural gas pipes in their house to refuel their cars would revolutionize the whole NGV effort.

Of course there’s always another possibility — converting our abundant natural gas supplies to ethanol or methanol that would fit right into our current gasoline delivery system. Switching to liquids would not require a new on-board gas tank but would simply involve adjusting existing engines so they could run on a variety of liquids — the “flex-fuel” system. Giving motorists the widest variety of choices would let them experiment with different strategies without having to make a giant leap over some technological chasm. That’s what California learned twenty years ago when it tried to rush the introduction of the electric car and the lesson still holds good today.

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There’s Gold in Them Thar’ Flares

Walter Breidenstein may be the only CEO in America who still answers the company phone himself. If his operation is still something of a shoestring, it’s because he’s spent four years trying to duel with perhaps the most formidable foe in the country, the oil companies.

“I’ve been trying to get into North Dakota for four years to show them there’s a way to make money by stopping flaring,” says the 48-year-old who started his entrepreneurial career at 15 by washing dishes. “The oil companies have done everything they can to keep me out of the state and the bureaucracy has pretty much goes along with them. The companies know that as soon as they acknowledge we’ve got a workable system here, they’d have to buy one of our rigs for every well in the state.”

North Dakota, in case you haven’t heard, has become one of the biggest wasters of natural gas in the world by flaring off $1 billion worth a year while producing carbon emissions equal to 1million automobiles.  But oil is what the drillers are after and, as it was in the early days of the oil industry; gas is regarded pretty much as a nuisance. The result is gas flares that make the whole state look like neighboring Minneapolis from outer space.

The flaring has generated a lot of negative publicity, environmentalists are up in arms and landowners have sued over lost royalties. The big guys are starting to move into the state. The New York Times ran an article this week about new pipeline construction, fertilizer factories and GE’s “CNG in a Box,” which will capture flared gas and sell it asnatural gas.

Breidenstein has a different idea.  “Somewhere around 2000 I started reading about methanol technology and realized it was a very undervalued resource,” he says. “Then I read George Olah’s The Methanol Economy in 2006 and that convinced me.  At Gas Technologies we’ve been trying to put Olah’s vision into practice.”

Gas Technologies has developed a $1.5 million portable unit that captures flared gas and converts it to methanol. “It’s a very accessible device,” says Breidenstein.  “You can move it around on a flatbed truck.”  The company ran a successful demonstration of a smaller unit at a Michigan oil well last fall but still hasn’t been able to break into North Dakota.

“The oil companies’ attitude is that money is no problem as long as they don’t have to spend it,” says Breidenstein.  “I’ve been in the business 25 years and I know where they’re coming from. But the problem is no one is forcing them to deal with flaring. And as long as they can keep throwing that stuff into the atmosphere for free, nobody’s going to look for a solution.”

You’d think with a billion dollars worth of natural gas being burning off into the atmosphere each year, though, there’d be some say to make money off it and that’s what frustrates Breidenstein.

“Our rig costs between $1 and $2 million dollars,” he says.  “But by capturing all the products of flared gas, you can make around $3500 per day.  That puts your payback at around three to four years.  But the oil companies don’t think that way. They won’t look at anything that goes out more than six months.

That puts things in the hands of state regulators and so far they have sided with the oil companies. “By statute, the oil companies are allowed to flare for a year it there’s no solution that’s economical,” says Alison Ritter, public information officer for the North Dakota Department of Mineral Resources.  “There’s nothing we can do to require them to buy from one of these boutique firms. Many oil companies have already committed their gas to pipeline companies and they can’t back out of those contracts.”  Still, the pipelines may not be built for years. “You have to understand, the Bakken Oil Field is 15,000 square miles, the size of West Virginia,” adds Ritter.  “It’s hard to service it all with infrastructure. We’re building pipelines as fast as we can.” Of 40 applications for flaring exemptions submitted this year the state has approved two and denied one, with the other 37 pending.  While they are pending, flaring goes on.

Of course if Gas Technologies were to start receiving orders right now, they’d be hard pressed to produce a half-dozen of them let alone the 500 that the state might require. “We’ve had talks with venture capitalists but if you’re not from Silicon Valley, they’re not interested,” says Breidenstein.  “But we’ve got a business model here and we know it can work.”

At least someone has taken notice. This year Crain’s Detroit Business rated Gas Technologies Number One in the state for innovative technology, ahead of 99 other contenders, including General Motors, Ford, Volkswagen, Whirlpool, Dow Chemical and the University of Michigan.  “Because the Walloon Lake company’s patents are potential game-changers, its patents rank high on the value meter with a score of 156.57 (anything over 100 is considered good),” said the editors.

It may not be long before others start noticing as well.