Posts Tagged ‘Energy Security’

Daniel Yergin on energy security

March 24, 2012

The Quest: Energy, Security and the Remaking of the Modern World is Daniel Yergin’s magisterial survey of the world energy situation.  His guiding principle is that energy security requires diversity of supply, and so he surveys energy  in all its aspects, from the battle for control of the energy resources of the new nations of Central Asia to the possibility of using genetic engineering to create ethanol-making fungi.

This book is not as focused and gripping as Yergin’s previous book, The Prize: the Epic Quest for Oil, Money and Power.  Its great merit is Yergin’s encyclopedic knowledge and his ability to see connections among seemingly unrelated facts.  I learned interesting things I didn’t know, such as that China is now the world’s biggest market for automobiles, or that Admiral Rickover was not only the father of the U.S. nuclear submarine, but of the civilian nuclear power industry as well.  This is a long book, but worth the time if you have an interest in the subject.

Yergin is an insider, not a hostile critic of the energy establishment.  I take his views to represent the consensus of well-informed people within the energy industry.  I mean this as an observation, not a criticism, but I do not take his opinions as necessarily the last word.  For example, I can’t agree that the invasion of Iraq was justified though mishandled, and that the U.S. has “no choice” but to attack Iran if its government acquires nuclear weapons.

The book has six main sections
▪    An update on the world oil industry since publication of The Prize in 1991.  The most important new developments, according to Yergin, are the emergence of China as possibly the world’s largest market for energy and the re-emergence of Russia as a major energy exporter, especially of natural gas.
▪    A rebuttal of the assertion that production of oil, other liquid fuels and natural gas have passed their peak.  Yergin argued that “unconventional” sources, including hydraulic fracturing and deep water drilling, will assure supplies at current rates of use for decades.
▪    A survey of the world electrical industry, and the merits of nuclear power, coal and natural gas to power generating plants.  He concluded abundant, cheap natural gas is the fuel of the future.
▪    A report on global warming and its effect on world energy policy.  Yergin is curiously noncommittal on the validity of global warming science.   His concern is its impact on world energy policy.  The chief problem is the conflict of interest between the United States and the energy-efficient Europeans and Japanese, on the one hand, and with China and other emerging nations, which can’t avoid using more energy as they raise the material living standards of their populations, on the other.
▪    A report on photovoltaic cells, wind energy and other alternative energy sources for electrical generation.  Wind energy is the most promising, according to Yergin, but will require continuing government subsidies to be viable on a large scale, he said.
▪    A report on ethanol, electric vehicle technology and other alternative energy sources for automobiles.  Electric and hybrid vehicles are a viable but as-yet small industry, he wrote; the future of ethanol rests not with corn, but less expensive sources such as sugar cane and switch grass.

I put down the book with a great appreciation of the difficulty and complexity of the task of assuring a supply of gasoline for my car, natural gas for my furnace and electricity for the computer into which I am typing these words, and also an appreciation for the difficulty of bringing new technologies into practical use.

Daniel Yergin

What Yergin wants is what I want—the blessings of modern, prosperous industrial civilization without burning up nonrenewable resources to the point of scarcity, and without threatening human health and the human environment.  Unfortunately, he wrote, we don’t yet know how to do this.

For at least the next 20 or so years, he wrote, we will have to rely on technologies such as hydraulic fracturing and deep water oil drilling.  Subsidies are necessary because, in the past, promising developments of new technologies have been wiped out every time oil prices fell.  So far the greatest progress has been by eliminating waste, improving efficiency and conservation, which don’t get public attention because they are not glamorous.

Fortunately, Yergin said, there is growing availability of “what may be the most important resource of all—human creativity.”

Click on Daniel Yergin | Official Website for Yergin’s home page.

Click on Daniel Yergin Examines America’s ‘Quest’ for Energy for a link to a National Public Radio interview with Yergin on hydraulic fracturing.

Click on the following for reviews of The Quest.

How Will We Fuel the Future? by Fareed Zakaria in the New York Times

Fareed Zakaria, Daniel Yergin and the elite disdain for clean energy deployment by David Roberts on the Grist green energy web site.

Daniel Yergin explores the energy industry and how it’s reshaped the modern world by Michael Hiltzik in the Los Angeles Times

Daniel Yergin’s guide to the essentials of industry in the 21st century is another triumph by Ed Crooks in Britain’s Financial Times

An enjoyable assessment of our energy needs from an industry insider by Derek Browne in Britain’s The Observer

Daniel Yergin can’t quite fully support wind, but he tries hard by Chris Varrone on the Renewable Energy Focus web site.

Visions of an Age When Oil Isn’t King by Dwight Garner in the New York Times

Click on the following links for two of my earlier posts on The Quest

Hubbert’s Peak: are we running out of oil?

Natural gas: the fuel of the future?

Natural gas: the fuel of the future?

March 21, 2012

When I reported on the electric utility industry 25 or 30 years ago for the Rochester (NY) Democrat and Chronicle, natural gas was regarded as a premium fuel—an ideal fuel in that it burned cleanly, without emitting pollutants, but costing much more than any of the alternatives.

Nuclear power was the cheapest fuel, followed by coal and then oil.  But nuclear power plants were the most expensive to build, followed by coal-fired plants, then by oil-fired plants with natural gas plants the cheapest to build.  So the logic was that you would want nuclear power for your base-load generation—the power you would want turned on all the time, year in and year out.  And you would want natural gas for your peaking power, the power you would turn on to meet peak demands, such as for air conditioning on the hottest day of summer and electric heat on the coldest day of winter.

I’m now reading energy expert Daniel Yergin’s new book, The Quest: Energy, Security and the Remaking of the Modern World, and Yergin says all that is out of date.  Natural gas is now cheap and abundant and, in his view, the fuel of the future for the electric power industry and much else.

Yergin wrote:

Natural gas is the fuel of the future.  World consumption has tripled over the last thirty years, and demand could grow another 50 percent over the next two decades.  Its share of the total energy market is also growing.  World consumption on an energy-equivalent basis was only 45 percent that of oil; today it is about 70 percent.

The reasons are clear:  It is a relatively low-carbon resource.  It is also a flexible fuel that could play a larger role in electric power, both for its own features and as an effective—and indeed necessary—complement to greater reliance on renewable generation.  And technology is making it more and more available, whether in terms of advances in conventional drilling, the ability to move it over long-distance pipelines, the expansion of LNG onto much larger scale, or, most recently, the revolution in unconventional natural gas.

Back when I was reporting on the industry, natural gas was transmitted in pipelines.  That’s why the Reagan administration objected to Russia’s Gasprom exporting natural gas to Western Europe; officials feared the Soviet government would be in a position to cut off supplies.

Click to enlarge.

There was an emerging trade back then in liquified natural gas, or LNG, but this was in its infancy.  LNG involves cooling natural gas down to minus 260 degrees Fahrenheit, at which it turns into a liquid with 1/600th the volume of the gas.   Yergin described how availability of LNG has created a world market in natural gas, led by Qatar, which shares access with Iran to the world’s richest natural gas field, right in the middle of the Persian Gulf.  Other LNG exporters include Oman, Abu Dhabi, Algeria, Libya, Egypt,  Nigeria, Equatorial Guinea, Malaysia, Indonesia, Brunei, Australia, Russian Sakhalin, Alaska, Trinidad and Peru.

The necessity to keep LNG at such incredibly low temperatures makes it seem like an unforgiving and dangerous technology.  Yergin didn’t address safety issues, but the Wikipedia article on LNG indicated a good safety record to date.

What Yergin calls “unconventional” natural gas is extraction of natural gas tightly locked into strata of shale by means of a technology known as hydraulic fracturing—a technology which, some of us here in upstate New York believe, creates a danger of water pollution, minor and not-so-minor earthquakes and destruction of the rural countryside.  Yergin did not deal with these objections.  I imagine he would say that this is no worse than coal mining, oil drilling or any other type of fossil fuel extraction.

Coal is the most undesirable source of energy.  The mining of deep coal is one of the most dangerous occupations.  Coal miners have a high death rate in mining accidents and black lung disease.  Surface mining is destructive to the environment.  Coal is the worst source of pollution.  Coal emissions cause respiratory disease and acid rain.  And coal is a major contributor to global warming.

Yet coal is what the United States may have to fall back on if all else fails.  Yergin pointed out that the United States has a quarter of the world’s known reserves of coal, about the same as Saudi Arabia’s known reserves of oil.  The United States together with China, another coal-rich nation, are working on technologies to burn coal cleanly.  One such technology is carbon capture, which would remove carbon from the smoke as it goes up the stack, and make it useful, or easily disposable.

I always thought of nuclear energy as a dangerous technology that is possible to operate safely.  The Chernobyl disaster showed the cost to human life when a nuclear power plant was operated without proper precautions.  Yet the excellent safety record of the U.S. and French nuclear power industries convinced me that, with proper safeguards, these dangers could be averted.   And, as Yergin noted, the increasing efficiency of nuclear power plants has been the equivalent of a whole new source of energy in itself.  I agreed with President Obama’s plan to bring about a rebirth of nuclear energy in the United States.

The Fukushima catastrophe in Japan called my assumptions into question.  The catchphrase, “Nobody could have predicted…”, is a common excuse for negligence and failure.  But I do not think the Japanese were negligent.  As far as I know, they did everything a reasonable person could have done to ensure safety and reliability.  Nobody could have predicted an undersea earthquake would create a tsunami that would inundate the plant and destroy all its backup systems.

So this leaves natural gas.   I still think it would be best to put off hydraulic fracturing for natural gas as long as possible, in hope that more benign technologies will appear.  If not, the gas is not going to go away.  It will be more valuable in the future than it is now.  If there is no choice but to go ahead, New York and other states should enact a severance tax, similar to what Texas, Alaska and other states have for oil.  If we are going to put the countryside at risk, we should be getting something back in return.

Click on Daniel Yergin | Official Website for Yergin’s home page.

Click on Daniel Yergin Examines America’s ‘Quest’ for Energy for a link to a National Public Radio interview with Daniel Yergin on hydraulic fracturing for natural gas.  [Added 3/24/12]

Click on Hydrofracking and  carbon caps for an earlier post of mine.

Click on Liquified natural gas wiki for a Wikipedia article on LNG.

Click on Qatar Economy | Economy Watch for more about Qatar’s natural gas industry and the source of the map below, which shows world exports and imports of LNG and pipeline nature gas.

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