Learning from comments

Great example of the value of rapid collective dialogue in a comments section, started by Felix Salmon's post on vehicle-to-grid:

This is a fantastic idea, and it’s a no-brainer, really, that all electric cars should have the ability to power the grid, rather than just drawing power from it. The number and size of power plants is a function of peak electricity demand; if electric-car owners collectively can help meet peak demand, then that means we need fewer power plants. And, the revenue from selling that electricity would help offset the extra cost of buying an electric car in the first place.

The comments point out two things. First, constant charging and discharging of a car battery would significantly decrease its useful life. Second (by yours truly), in most states, regulations prevent utilities from charging residential customers different prices for electricity at different times of day, so the financial benefits or charging off-peak wouldn’t be be captured by users.

Then Dan Ferber, the author of the original article that was the subject of Felix's original post, clarifies that the vehicle-grid interaction is mainly frequency regulation, not bulk power - very helpful!

The problem with comments, though, is that people lose interest or stop checking. So my final question - "if the main vehicle-to-grid interaction is frequency regulation, rather than bulk power transfer, then it’s unlikely to lead to the type of load-shifting and peak-shaving that Felix suggests, correct?" - has, as of now, gone unanswered.

Electric power supply-demand is nuanced

This post over at Marginal Revolution is a great example of why industry-specific knowledge is important, and why extrapolating from general economic principles can be dangerous.

Can you discuss whether [energy efficiency via smarter thermostats] can possibly work? As I understand the power industry, such a high percentage of the costs are upfront (with nuclear plants in particular, but with carbon burning plants as well) and the marginal price of producing energy (up to plant capacity) is so low, that falling demand would mostly cause plants to cut prices until they were again operating at capacity.

So “saving” energy at the consumer level won’t really reduce total energy consumption or gas emission.

As people familiar with the electric power industry already know, baseload power (e.g. nuclear) has low marginal cost but is also not supplying marginal supply - that role is played in most regions by gas turbines (and in some places by older coal or oil), which sell pretty much at marginal cost. A quick way to check this is by multiplying the price of natural gas by the heat rate of the marginal gas plant, and comparing that to the price per MWh of electricity - they will usually be pretty close.

The best commenters do a good job of explaining this. Ignore the first half dozen or so, Alfred and valuethinker are strong.

For what it's worth, U.S. industrial and commercial load is still below 2007 levels; energy efficiency standards from EPAct and EISA may be one factor, although obviously very difficult to parse out the effect of energy efficiency from other drivers like, say, the economy.

You, too, can innovate

13-year-old makes solar power breakthrough by harnessing the Fibonacci sequence (and files for U.S. patent).

Apologies for the light posting, which will likely continue - various professional demands on my time have increased, and I'm working to keep a certain amount of personal time sacrosanct.

Yucca mountain revival and Fukushima design specs

It seems that science may prove more enduring than politics in the case of Yucca Mountain, which was given up for dead by many two years ago when Harry Reid apparently made it his price to support Obama's legislative efforts. A recent review calls into question the decision, in particular the conduct of NRC chairman Gregory Jaczko (former science advisor to, coincidentally, Harry Reid). My views on this are pretty clear and it's encouraging to see the disappointing decision receive this scrutiny.

In related news, I found it interesting (from this CSIS report on nuclear power after Fukushima) that the Fukushima reactors did not fail their design specifications:

First, the nuclear facility itself seems to have withstood a record 9.0 earthquake without critical damage because all of the reactors struck by the earthquake shut down as intended. The March 11 earthquake exceeded the design criteria and reinforces a lesson learned from an earthquake that damaged the Kashiwazaki-Kariwa reactors several years earlier—these facilities are very robust. A second lesson is that the facility was vulnerable to compromise from damage to external elements of the plant brought about by a tsunami that was 150 percent larger than the design criteria.

Little comfort after a full meltdown of three different cores, but at least interesting in diagnosing the root cause of the problem and planning for the future.

P.S. The fact that that was what jumped out at me makes me wonder if I should be driving more consistently for higher-level messages, rather than interesting factoids.

NYTimes weekend round-up

I don't often read the full NYTimes, but I happened to this Sunday, and since I haven't posted in over a month, and it's almost the end of June, and my blogging progress seems eerily paused at 666 posts and 7,777 hits, I figured I'd throw out a few links with brief commentary:

• Insiders Sound Alarm Amid Natural Gas Rush: an interesting article seriously examining the claim that shale gas isn't profitable and is a big bubble. There's certainly some truth to that idea that many shale gas investments aren't making very good returns at $4.30/mmbtu gas; that said, the article would have really benefitted from some actual numbers (even ranges) comparing production costs to current and potential future gas prices. Without those, it's a qualitative discussion of a problem with a largely knowable quantitative answer.
  
  The one thing I did find intriguing (and again, would love to see real numbers on) is the steep decline in productivity of shale gas wells over the first few years. I would assume that since the technology is not new, this performance has been built into business cases for individual wells, but you never know...
  
  There's also a fundamental difference between a gas "bubble" (if there is one) and the typical bubble (e.g. internet) in media parlance, which is that North American gas prices have already crashed. This article would be analogous to calling the internet a bubble in 2003, not 1999, and that limits the usefulness of the analogy.


• Chevy Volt and Future of Electric Cars: A feel-good article from Joe Nocera after he test-drives a Chevy Volt; made me want to try one too. The “it’s like playing a video game that is constantly giving you back your score” comment particularly resonated with me. The lack of that type of feedback is a common motif across consumer energy usage (think about the current opacity of household electric power) and a thematic area for substantial change and impact.


• Power Drain From Cable Boxes: Striking; I had no idea that "some typical home entertainment configurations eating more power than a new refrigerator and even some central air-conditioning systems." Once again, greater feedback in home energy consumption could help move the needle on consumer behavior here.


• Ethanol Production Wastes Corn: Steve Rattner is right, but has nothing new to say

6/30 addendum: A colleague told me that Chevy loses $18,000 per Volt it sells. So we are still a ways away from the economic tipping point.

Germany to phase out nuclear by 2022

This isn't the first time they've said this (the last was before the commodity boom), but

Germany will shut down all its nuclear plants by 2022, and eight reactors shut down after Japan's nuclear disaster in March won't be reactivated, the government announced Monday.

I'm generally bullish on nuclear power compared to other power sources (especially those which are currently baseload capable), so I'm sad to see this. And as a colleague of mine noted, the Russians must be grinning with glee that their geopolitical leverage and economic profits from natural gas will return with a vengeance.

Cute analogy

Aluminum is to energy as grain is to water.

(Half courtesy of Laurence Smith's The World in 2050, via MR, and half courtesy of a conversation with a colleague.)

Current U.S. nuclear waste storage strategy

Speaking of strategies to store nuclear waste, here's an article on the current de facto U.S. government strategy: compensate nuclear operators for storing onsite, and double the expense by continually pursuing doomed litigation to avoid these payments. I think in a perfect world we could probably figure out something better.

Larry Summers, prophet of toxic waste

Two decades after the infamous Summers memo,

The U.S. is reportedly in talks with Mongolia about the country setting up an international repository for nuclear waste.

Via FP Passport, details (fairly speculative) here.

Like a few other Summers statements, the one on toxic waste (which he later asserted was sarcastic) is easily demonized, but upon further examination shouldn't be dismissed out of hand.

I find the nuclear waste storage debate in the U.S. intensely frustrating - it is on par with entitlement spending in the political challenges of doing the right thing in the face of short-term incentives that are much stronger and more visible than the long-term ones.

I also liked an idea from Stuart Brand's Whole Earth Discipline: rather than try to prove a storage site will be safe for 10,000 years, use the Iroquois seven generations rule, find somewhere it will be safe for 200 years, and see how far re-processing technology has evolved by then.

Not to be deterred...

... China is going ahead with plans to build a fourth-generation nuclear reactor.

“There are differences between the Japanese and Chinese reactors,” Cui said. “Japan’s Fukushima plant was using old technology while Chinese reactors are more advanced.”

Given the amount of potential in new reactor designs, and the hurdle of technological lock-in, great to see someone boldly taking the lead post-Fukushima.

Web guide to radiation exposure

A colleague directed me to this online graphic, which aims to put different magnitudes of radiation exposure in context. While not taking anything away from the heroic efforts of the on-site engineers and technicians who are battling to prevent further meltdown, or how scary it must be to find radioactive iodine in your spinach, the (highly caveated) message seems to be that we're an order of magnitude or more from Chernobyl or any level of serious danger to populations beyond the immediate vicinity.

Decoupling of oil price and renewables

Geoff Styles has a post titled "Will $100 oil help renewables?", in which he argues the counterintuitive answer that, "no, not that much." Worth reading in full, but since I like to practice synthesis:

Today, gas predominantly sets the marginal price of power generation, and gas prices have decoupled from oil due to abundant shale gas supply. Transport is minimally electrified, so renewable power cannot yet substitute oil in that sphere. And prices for commodity input often rise along with oil, increasing renewable costs (a.k.a. the "receding horizon").

The first, I totally agree with. The second is broadly speaking true, although paths like CNG, gas-to-liquids and coal-to-liquids become economically viable with high oil prices and could re-strengthen the link between transport and electric power (as could increasing EV penetration over the longer term). The third is directionally true, but not absolute (and not entirely causal). Many second-gen biofuels use waste inputs which are not otherwise traded, so higher oil prices are an unmitigated boon for them. The prices of silicon and corn are often correlated with crude, but probably more because of overall economic growth than because crude drives their price. It will be interesting to see if corn starts to price off of its value as ethanol, as it did back in 2008. Not good for food security, if it does.

Crowd-sourcing carbon pathways to 2050

I haven't tried it myself, but the new 2050 pathway calculator looks like a neat tool to stimulate reasonable public debate about climate trade-offs in the UK. Reminiscent of Chevron's Energyville, you input your choices for energy sources and see what the outcomes look like in 2050.

Via David MacKay, who also synthesizes the preferred pathways of eight expert panelists.

It's now open to the public to join in. In a couple more days, the opening panel will wrap up their conversation; it'll be interesting if they can achieve consensus on one or two pathways.

A promising experiment, and easily replicable in the U.S...

Better energy storage?

Via Geoff Styles, a very intriguing idea: Windfuels, i.e. "storing wind power in gasoline."

Doty Windfuels has been working on a system called RFTS, or Renewable Fischer Tropsch Synthesis. The process looks to use off-peak excess wind energy to recycle CO2 into standard fuels that work seamlessly in the one billion cars and trucks on the road around the world. The chemistry is fundamentally simple and well understood.

Geoff doesn't seem all that enamored of the idea (put off in part, he admits, by the inventor's excessive negativity toward seemingly all other energy alternatives). I'm a bit more positive. There's a lot to be said for building almost entirely on proven technologies (in this case, chemical pathways; the only step not commercialized is reducing CO2 to CO). Even if the economics get worse as other energy storage technologies like CAES begin to compete up the price of off-peak electric power, it certainly wouldn't be a bad thing for there to be one more storage technology in the mix. And even if this specific idea doesn't bear fruit, it encourages further investigation of storing off-peak power as chemical energy (rather than mechanical, e.g. compressed air, or thermal, e.g. molten salt), an avenue I hadn't thought of much, and one which makes a lot of intuitive sense.

Sure investment advice?

BlackRock CEO Larry Fink thinks agriculture and water will perform even better than energy:

"Go long agriculture and water and go to the beach," said Mr Fink, whose creation was now the biggest funds manager in the world, with $US3.5 trillion ($3.07 trillion) under management -- more than the GDP of Germany.

"Put those investments in the bottom drawer for 10 years. It's unlike anything else we have in the world."

Agriculture and water would even beat energy investments, he said.

"They're finding lots of ways to find new energy -- Israel's going to be an exporter of natural gas and I'm hearing there's more oil under Iraq than Saudi Arabia, for instance, although it's not secure."

This is probably right, although I have two caveats. First, it's hard to find a vehicle to use to go long on water. Second, I don't buy that it is so simple to prove that commodity prices will trend upward from their current level, as Matt Yglesias tries to do by saying that

Over the past ten years, catch-up growth in India, Brazil, and (especially) China has been the majority of world growth. Consequently, the rate of stuff-utilization is going up higher than the rate of stuff-production, meaning we’ll see rising commodity prices rather than falling ones.

There are real discontinuities in the supply and demand curves for commodities, and if it were that easy, none of us would have to work our day jobs.

I do agree with Yglesias, though, that the implications of rising commodity prices are decidedly not good for poor countries with stagnant growth. What's going down in Egypt looks very, very real.

P.S. From Felix Salmon, the good thing about Egypt is that the WEF fixed it.

Styles 2010 energy round-up

Geoff Styles, as preeminent an energy blogger as there is, has a little round-up of 2010 in energy, which is worth reading in full (including links), so I won't paraphrase it exhaustively here. He comments that the two truly unforeseen and shaping events of the year were Deepwater Horizon and "the less spectacular but no less profound awakening to the possibilities of the shale gas revolution." His comment on shale gas is particularly insightful:

That might help explain why the developers of renewable electricity sources such as wind have struggled so much this year, despite receiving $3.9 billion in direct cash grants from the US Treasury. They're not competing with $90 oil; the US generated less than 1% of its electricity from petroleum this year, through September. Instead, they're competing with gas at an effective price of $25/bbl or less.

Here's the killer graph:
Shale gas really is a game-changer, but its continued rapid growth is not a foregone conclusion. The two massive unknowns that I will be watching closely in 2011 are the environmental impact (already much debated and increasingly feared), and how it evolves outside of North America - in previously gas-vulnerable Europe, and even more so in China, where the reserves are likely enormous and the government has the power to develop them rapidly, if desired.

With that, Merry Christmas to you and your loved ones, and I will get back to mine.

Highest climate ROI = family planning

Suppose you had $1 million to spend on tackling climate change. How would you spend it to get the best bang for your million bucks?

Would you spend it on stopping the slash-and-burn of forests? Perhaps on switching to nuclear energy? More energy-efficient buildings? Building cleaner power stations?

According to a recent paper by David Wheeler and Dan Hammer, climate change experts at the Center for Global Development, the answer is (drum roll): you would do much, much better to spend your money on a combination of family planning and girls’ education in developing countries.

That's Owen Barder, reporting on a Copenhagen Consensus-like analysis (in output, not methodology) on climate change mitigation. According to the analysis, the killer combo of family planning and girls' education is ~4x as cost effective as reducing deforestation, ~6x better than nuclear and almost 10x better than CCS.

An interesting thought explored in the comments is whether this would be more impactful in poor countries (high potential to reduce fertility but tiny per capita emissions) or rich countries (little unmet demand for family planning, but much larger carbon footprints). Apparently the two are similar (at least the U.S. is).

As Owen acknowledges, there are limitations to this approach, but at the very least this appears to be a solid analysis with a thought-provoking conclusion.

Market won't drive clean energy transition

Geoff Styles blogs a recent Science article explaining why the transition to cleaner fuels will take a long time.

Here's a clear and concise explanation from the top science journal in the country on why the transition to alternative energy won't--and can't--be quick, cheap or easy...

That's a crucial point for anyone who sees this energy transition driven not just by concerns about energy security and greenhouse gas emissions, but by notions of clean energy as the next big wealth-creating global trend, akin to the computer revolution. A kilowatt-hour or BTU does the same work, regardless of its source, so unless it can be produced for significantly less than from conventional sources, greener energy offers no productivity gains of the kind that have fueled the global infotech transformation.

Density and intermittency are both large disadvantages that many renewable energy sources must overcome... and even without these disadvantages, the article explains, the transition to current fossil fuels took half a century.

Pursuing renewable energy is a worthwhile goal (neither Geoff nor the author disagree), as is chasing energy efficiency, which is perhaps our most attractive short-term option to balance energy demand and supply. But I also agree that it's prudent to disregard the optimistic claims of those who believe things along the lines of "replacing oil will be the greatest commercial opportunity of our generation." It won't.

Energy back-of-the-envelope of the day

Geoff Styles calculates that the newly-approved Cape Wind will generate only slightly more energy than is leaking from the single well drilled by Deepwater Horizon:

Cape Wind and the Macondo prospect that the Deepwater Horizon rig was drilling into represent opposite poles of the energy spectrum, and not just because the latter is now leaking oil into the marine environment at a rate that the latest estimate puts at 5,000 barrels per day, much higher than initially thought. Cape Wind would tap into the clean and renewable, but extremely diffuse energy sources that surround us. After taking into account the restrictions imposed by DOI, its 130 turbines would on average generate as much electricity as a gas turbine power plant consuming a quantity of natural gas equivalent to 6,000 bbls/day of oil. In other words, it takes a very large array of offshore wind turbines to match the energy in the oil currently leaking from a single well. Platforms similar to what BP might have been planning to install after successfully completing the exploration of Macondo routinely produce up to 20 times that much oil.

Can't quit "dirty power" cold turkey

In response to an over-enthusiastic Earth Day petition, the always-thoughtful Geoff Styles thinks through the following:

What would it mean if every power plant burning coal, oil or natural gas shut down today and remained idle? The short answer is chaos and social collapse, but let's take a quick look at why.

Here are a few of his facts for the numerically inclined:

As it turns out, all renewable sources plus nuclear generated a bit over 1.2 trillion kilowatt-hours (kWh) last year... Unfortunately, it's also less power than the US has generated in any year since 1966.

If we adjust for energy:GDP, then 1979, with its net generation of 2.25 trillion kWh, looks like a more appropriate basis of comparison to the economic work that our current zero-emission power output could do. The problem is that the US population has grown by 84 million people since then, and our economy, expressed in constant dollars, is more than twice as big as in '79--even after last year's contraction.

The wind, solar and geothermal power sources we've focused intensely on expanding accounted for just 2% of the electricity we used last year. Double them, and then double them again (10 years?) and that's still only 8%, compared to the 69% we got from fossil-based generation last year.

The argument almost makes itself, but he makes it well. And rightly doesn't even bother with the triviality of a similar argument for fossil transportation fuels.