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Energy past, energy future

John Frary

John Frary

Just yesterday I was privy to a moderately beerish discussion about wind power between two engineers; one visiting from Ohio who teaches engineering, one from Boothbay who designs unique private homes. They were in perfect agreement in deriding wind power schemes as ridiculous from an engineering point of view.

Earlier this month I received Quest: Research News from PPPL, a supplement enclosed in my Princeton University Alumni magazine. There I read about the Princeton Plasma Physics Laboratory’s “new paths to fusion energy” and its work in “advancing fusion theory.” The PPPL director, Stewart Prager, explained that “Fusion powers the sun and stars, and harnessing its power on Earth could provide a safe, clean, and virtually limitless way to meet global energy needs.”

It is far from certain that Princeton’s wizards and their international partners will succeed in solving the problems of cold fusion, but it is certain that if they do every other energy investment will suffer a steep loss. Many, or most, will sink without a trace.

These events prompted me to revisit my investigation of energy topics five years ago, when I ran for congress. “Investigation” is perhaps too pompous a word to describe my hasty researches. My ambition was limited to becoming more knowledgeable on the subject than Mike Michaud. This was no challenge since Mike’s issue research is pretty much confined to reading polls to find out what he supports and what he opposes.

The prospect of a victory being remote and a bit repellent, I ran an educational campaign, placing columns in all the weeklies and free papers in the district along with some Internet news outlets. One of these caught the attention of Brian Westerhaus, an employee of M.J. Beck Consulting, LLC which analyzes energy problems and issues for its clients. Westerhaus runs nextenergynews.com on which he posted the following:

TOO GOOD TO IGNORE – OR $60 TRILLION IS GETTING AWAY.
OK, it’s Saturday and I’m going to throw something extra out at you. It’s a (gasp) politician or more accurately a college professor taking a run at the U.S. Congress from Maine. John Frary wrote the following piece for the Village Soup a kind of “Beyond print and online news for community based discourse, debate and commerce.” A sort or kind of highly sophisticated bulletin board.

The article is titled “Peak Oil or Peak Stupidity?” which caught my eye. John writes a fun-to-read piece and gets some interesting points of view expressed in a gentle, if humorous way. I just about fell out of the chair at his revenue observations, something everyone else has overlooked. He has some utterly stunning numbers to consider. There is huge gut check in the last line. John is welcome here anytime.

The article is just a rip roaring slap at the establishment. With great pleasure (and a sense of relief such a ‘politician’ exists) I give you – John Frary:

Peak Oil or Peak Stupidity?
“If stupidity got us into this mess, then why can’t stupidity get us out?” — Will Rogers.

THE MESS: Over 50 years ago a geologist named M. King Hubbert accurately predicted that U.S. oil production would peak in the 1970s. The arrival of peak oil inspired our political leadership to unleash all their resources of stupidity. They curbed the development of nuclear power, closed most of the American coastline to exploration and extraction of oil and gas, placed a moratorium on the exploitation of our huge shale oil resources out west, put an end to refinery building for 30 years, and forbade the oil companies from disturbing Alaska’s sacred caribou. The development of hydroelectric power and wind power have been unsystematically impeded by tangles of environmental regulations and lawsuits.

Even this was not enough. Republicans and Democrats have collaborated in deficit spending financed by foreign borrowing which have depressed the value of the dollar, increasing the price of the foreign oil, which we must buy to keep our economy going.

STUPIDITY TO THE RESCUE?
Will stupidity get us out of this mess? We’ll soon find out. Washington has mounted a massive Stupidity Surge to address the problem.

We have new CAFE standards obliging domestic auto manufacturers to increase miles per gallon performance. Very helpful. GM reports a 37 percent drop in SUV, pick-up and van sales in May. Did its executives really need Congress to tell them what $4 gas means for their product line?

A gaggle of senators have written a letter to the Commodities Futures Trading Commission requesting them to raise margin calls on futures contracts. Sounds like a good idea, but what’s the point? Do they really think the commissioners haven’t been considering that step for weeks? Or that they have greater knowledge of the commodities market? The CFTC, of course, is trying to figure how to quell speculative exuberance without creating a crisis in a half-trillion dollar financial market.

Windfall profits taxes? Everybody who hates Big Oil (that’s just a little short of everybody) will feel good about that, but it won’t lower anyone’s fuel bills. The government’s take from this profits tax are intended to support the clean energy schemes contained in HR 6049. I refer my readers to Subtitle A, Part I, Section 101, subsection (b), sub-sub section (1), Paragraph B, clause (iii) “PRELIMITATION CREDIT- The term `prelimitation credit’ with respect to any facility for a taxable year means the credit determined under subsection (a) with respect to such facility for such taxable year, determined without regard to subparagraph (A) and after taking into account any increase for such taxable year under clause (ii).” All clear now?

While we wait for our congressmammals to figure out what they voted for, the government reckons that we have 96.4 billion barrels of oil under ANWR and the Outer Continental Shelf. But we are told that we can’t drill our way out of this crisis. That means we must buy our way out. It costs us $600 million of our $700 million trade deficit to supply our fossil energy needs, which are 85 percent of our total energy needs.

Do the math. At $100 a barrel our reserves are worth nearly 10 trillion dollars. At $200 they will be worth nearly 20 trillion dollars. Do we really want this money used to finance indoor ski slopes for Arabs?

Westerhaus added a concluding comment: “Caught me off guard, you too? I haven’t heard comments on this from my good friends at the API [American Petroleum Institute] or the press, media, or the business community. It’s an observation off the radar. But I would point out that when we look at investments and spending there is always a multiplier effect in the communities, often a multiple of about 5, which would make the value to our economy something over $60.25 trillion at $126 per barrel. I’ll bet its lots more than that. Just a little something for the water cooler talk on Monday.”

Apart from a bit of self-glorification there are three reasons for dredging this up from my files. First, the fact that my elementary calculations were overlooked by real authorities is surprising. Second, subsequent developments may already have made those calculations immaterial. Third, there’s evidence that stupidity remains an important element in our energy policies.

When I examined nextenergynews.com, I found a comprehensive overview of energy innovations under 13 separate headings: aerospace, alternate fuels, batteries, electronics, fuel cells, hydrogen, hydro/water, nuclear, solar cells, thermal, vehicles, waste power, wind power. Each category contained dozens of articles and announcements. Some projects will succeed. Most will fail. Some will produce minor effects on production and conservation. Some, like cold fusion, may transform the whole energy sector.

This should demonstrate the folly of placing all our hopes on a few favored “green energy” solutions. There are far too many variables to make confident predictions about our energy future.

Just consider developments in the last five years. The most authoritative energy information website is http://www.eia.gov, maintained by the U.S. government’s Energy Information Administration (EIA) which spends over $100 million a year to collect relevant information on all energy production factors. It issues an Annual Energy Outlook (AEO) report containing projections of future energy production.

When I looked at of AEO 2008 five years ago it made no mention of shale gas or fracking. At that time it projected that the U.S. would get over 40 percent of is energy from coal by 2035.

When I checked AEO 2013 I found that it projects coal generation falling to 35 percent by 2040 as natural gas generation rises to 30 percent. It has an alternate scenario in which coal will amount to 27 percent of total generation as natural gas rises to 43 percent.

It shows renewables (wind, solar, biofuels, etc.) energy production multiplying several times over, but ending up with a tiny slice of total energy generation.

Who can predict what the next five years will bring?

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