The Truth About Fossil Fuels and Renewable Energy (Part II)

As many thoughtful commenters contributed after Part I of this article appeared, there are inescapable realities we must address if we are to strike an intelligent balance between quality of life, real cost of energy, and an environment that is in balance.

The first reality we must square is our love of our way of life with our environmental goals. We take for granted the freedom to drive to work, fly to meetings, visit friends and family no matter how far-flung, and drive to the mountains, the beach or other weekend and vacation destinations. We want to leave our computers on standby for ease of starting up the next morning, to keep our homes warm in winter and cool in summer, and to enjoy our flat screen TVs, electric blenders, Wii devices, and so much more. Don’t look now, but what we have is exactly what 1 billion Indians and 1.3 billion Chinese and another 3 or 4 billion people across the planet want.

The second reality is that we are quite schizophrenic about our energy usage. We don’t want to be dependent on foreign oil, but we also refuse to allow drilling on the millions of acres of public lands in the US or offshore. We say we despise the oil companies because we pay $3 a gallon for gas, but we haven’t allowed any of these companies to build a new refinery in the U.S. since 1976. There are reasons a-plenty for companies to agree not to build much-needed capacity: refineries are not particularly profitable, obstructionists fight planning and construction every step of the way, and government red-tape makes the task an all but impossible to succeed, decades long experience in frustration.

The last refinery built in the US was in Garyville, Louisiana, in 1976. The cost of building a new refinery is between $2 billion and $5 billion and experience has shown that any company that wants to build a refinery to process heavy tar sands or shale oil will have to fight self-appointed “protectors of the earth” for many years in the courts, then they have to apply for as many as 800 local, state and national permits. With the long-term rate of return on capital for refineries of just 5 %, why bother? In normal times, they can make that in T-Bonds without nearly the hassle.

So instead we allow resources to lie fallow right here in North America and we spend hundreds of billions to import oil from the Middle East, Russia, Venezuela and others – most of whom take great delight in watching our self-destruction. It’s disingenuous at best to rail about the Russians cutting off natural gas to Europe or Chavez in Venezuela expropriating US-owned energy infrastructure when, if we simply use what we already have in abundance, we wouldn’t give a rodent’s posterior what Putin or Chavez were doing to run their own countries into the ground.

Are there problems with drilling in American offshore locations? You bet. Is it easy to refine American and Canadian oil sands? Not on your life. Is it as cost-effective to extract natural gas from American shale as it is to import it as liquefied natural gas (LNG) from Dubai? Ummm -- well, actually, yes it is.

But all these entails hard choices – like moving lots of rock and putting it back later. Like ensuring that reforestation of denuded areas and best practices in soil management are put into practice. Nature seeks balance. If we only observe what Nature itself has done for eons and seek to duplicate it, we’ve solved fully half the carbon emissions problem. More on the solution later. For now, Walt Kelly, ardent conservationist and creator of “Pogo” said it best: “We have met the enemy and he is us."

The third reality, like it or not, is that the world’s demand for energy will grow by 30-50% over the next 20 years. We can talk all we like about conservation and Congress can waste its time and our money mandating mercury-filled flourescents, but the rest of the world will continue to be profligate. By the time I retire, we will need everything from every source that every energy firm can deliver. We’ll need it from oil, natural gas, coal, nuclear, wind, solar, geothermal, biomass, conservation and as-yet-unknown possibilities.

Fourth, eschew the “We’ll do it all with clean sunshine and a gentle breeze, man” types. There are no near-term alternatives to oil, natural gas, nuclear and coal. Like it or not, the world runs on fossil fuels, and it will for years to come. DOE forecasts that fossil fuels will supply about 78% of total US energy demand in 2030 – about the same as it does today. Willpower, rhetoric, wishing or a new hope for change will not change this fact. If you believe you can wish the world green, get over it. It’s all about thermodynamics, costs, and hard choices that grownups have to make.

Remember MEOW? (Jimmy Carters “moral equivalent of war.”) 30 years on, after $30 billion in government subsidies and a $26 billion a year government bureaucracy (DOE), alternative energy is still a hope. That's $30 billion pumped into ethanol, MTBE, hydrogen cars, etc. Of course, the elites who think they can overturn the laws of thermodynamics and economics by clever rhetoric, breads, and circuses, won’t stop spending our money willy-nilly on the next ethanol screw-up.

Here are some hard economic facts. To replace one 1,000 MW gas-fired power plant, you’d need 500 state of the art wind turbines spread across 40,000 acres or 250 high-efficiency solar facilities taking up some 20,000 acres. Why are gas, oil and coal so much more efficient, needing just a few acres to produce all that energy? Thank Mother Nature. Think of fossil fuels as giant “batteries.” They’ve been compressed for eons by Mother Nature into compact pools, pockets, mounds, shale and bitumen (also called tar sands or oil sands.)

To try to turn something as scattered as photons in sunlight or the kinetic and capricious energy of wind requires colossal investment to concentrate that energy as efficiently as Mother Nature has already done with fossil fuels. Fossil fuels are batteries. Every time. They work. In compact form.

Wind power, today, when we need to address the problem, is every bit as consistent as is the wind when you fly your kite. Some days it works, some days it doesn’t. Solar power, today, is every bit as efficient as the day you decide to get a tan and it rains. That’s not to say we shouldn’t continue to enhance the collection capabilities in these areas – just a reminder that they aren’t like batteries you can dig out of the drawer and know they will work every day, rain or shine, daytime or night-time.

We need all the wind, solar, geothermal, biomass and hydroelectric supplementation that we can afford. But let’s think of it rationally; today and for the foreseeable future, these sources will supplement the giant batteries Nature has created, they will not provide a cost-effective alternative.

Fifth, I can’t even dignify carbon cap and trade with valuable ink and space. This is simply another porky fiasco like ethanol, MTBE, and hydrogen-powered cars that will accomplish nothing and cost hundreds of billions or trillions. And it is doomed to fail unless we have viable alternatives -- not just supplements like solar and wind, but genuine replacements-- to the giant batteries known as fossil fuels. Something that can be provided in massive quantities at a price that won’t bankrupt us.

The final reality is that taking the actions presented in cap and trade and many of the Kyoto protocols would likely have no discernible effect on global climate.

Better we should improve energy efficiency from production to transmission to usage in home and office and use two sources of fossilized batteries, three if you count uranium as a battery (and I do) that this nation has in abundance: (1) We have the largest deposits of coal of any nation on earth, enough to last 200 years at current rates of consumption. (2) We don’t have natural gas pockets like Iran and Russia but we have every bit as much that is trapped in Rocky Mountain, Upper Midwest, and Southeastern US shale. With the recent technological advances and enhanced drilling techniques we’ve developed for this resource, we have roughly 100 years proven reserves. (3) Add to these two an energy source the US military has used safely for over half a century -- clean nuclear power -- and we have the batteries and the atoms to hold us in good stead until we can bring the “supplementals” up to real “alternative” levels.

Today, gas and nuclear alone provide 40% of our productive energy generation – and are the two cleanest of the Compressed Fuel Giant Batteries (very compressed in the case of uranium.) In France, nuclear is 75% of power generation. You don’t hear the French moaning about OPEC holding them up, do you? (Many other things, but not this!) And before anyone makes fun of France, how dumb are we to continue to forbid the building of oil and gas refineries and nuclear plants, and to make drillers jump through hoops to deliver clean natural gas to us???!!!

As for nuclear, Three Mile Island and The China Syndrome jolted that industry off-track just as it was gaining widespread acceptance. Yet China Syndrome was pure fiction and Three Mile Island resulted in no deaths or injuries to plant workers or members of the nearby community and, as far as we can tell with continuous monitoring of the area ever since, no problems with succeeding generations. Still, it provided an image, incorrect though it may be, of Armageddon.

That plant and the surrounding area is still continuously monitored by NRC, DOE, EPA, muckrakers, and No-Nukers. And there is still no evidence of any ill health effect. What Three Mile Island did accomplish was actually positive: sweeping changes for the better in “emergency response planning, reactor operator training, human factors engineering, radiation protection, and many other areas of nuclear power plant operations.” It also resulted in research that led to pebble reactors and the next generation of even safer nuclear facilities.

Again, it’s all about trade-offs in an imperfect world. If you hate the idea of a clean, quiet, no-emission nuclear plant, what is your alternative? 40,000 acre wind farms that produce a smidgen of the power? 20,000 acre solar arrays that produce a smidgen of a smidgen of what nuclear does? Freezing in the dark? Living in caves?

The nice thing about coal, gas and nuclear is that they don’t even need much in the way of infrastructure. Coal and nuclear are running at 75% or less capacity right now and natural gas-fired plants at less than 50%. If you really want to cut carbon emissions now, not when two guys in their garage find the solar Holy Grail, you could advocate switching from coal and oil to natural gas and nuclear. At less than 50% capacity, simply running natural gas plants at 75% could change our carbon footprint in the short term by more than any cap-and-trade lobbyist-funded boondoggle.

If we want to gain energy independence now, we have only to

• Level the playing field. End subsidies for oil, natural gas, nuclear, solar, wind, geothermal, et al. Gore everyone’s ox at the same time and let the advocates for each prove their worth in the marketplace. (Speaking of Gore, given his conflict-of-interest holdings in alternatives, I imagine he’d fight this tooth and nail!)
• Make the tough decisions as to whether we as citizens want to drill offshore, in ANWR, or elsewhere versus importing more and more oil from those who are using our money to do us harm. Decisions are not made in a vacuum. It isn’t “no new drilling and reduce our dependence on foreign oil.” That’s dreamy stuff for starry-eyed tourists.
• If we opt to allow drilling for natural gas (the cleanest of the fossil fuels and one which we have in abundance) and oil (which we have in less supply) and to build nuclear facilities and natural gas pipelines, refineries and other essential infrastructure (while still building cost-effective wind and solar farms), then we must reduce the regulatory nightmare to do so. Why 800 different permits from scores of local, state and national entities? What do they do for their $26 billion a year at DOE if not fulfill their charter to “reduce America’s dependence on imported oil?” If it’s anything other than that, I know a quick way to reduce the national deficit by $26 billion a year.
• My opinion: Build American nuclear plants, switch as much as possible to American natural gas, and use American coal for the rest. Reforest wherever possible to create carbon sinks that attract and convert these emissions, and use regenerative agricultural practices to sequester even more carbon. According to an article in Soil Science here, soil – plain old earth, dirt, terra firma – is a great carbon storage medium, and contains more carbon than all terrestrial vegetation and the atmosphere combined. For this last, we must change our agricultural practices to be more in line with organic gardening precepts but the health benefits would probably, coincidentally, save us a few hundred billion in health care costs, as well! And finally, after using more US natural gas and US/North American uranium; less but still significant US coal; continuing research and buildout in renewables like solar, wind and geothermal; and reforestation and natural sequestration; a little population control wouldn’t hurt, either.

How to Invest -- And In Which Energy Sources

Where to begin? I am primarily a buyer of natural gas companies, coal leasing firms, and natural gas pipelines. In my opinion, among the best of the natural gas firms are Chesapeake (CHK), Imperial (IMO), EOG (EOG) and Encana (ECA).

In coal, I stick with the coal leasing firms, which have no labor costs or accident liabilities but simply own mineral rights under land which is leased to coal producers. My two favorites are Natural Resource Partners (NRP) and Penn Virginia Resources (PVR). Vis a vis my comments about the amount of coal and natural gas we possess right here in the US and Canada, NRP has enough coal property under lease to fill its current contracts completely -- until at least 2040! I don’t own but you might take a look at two coal ETFs, as well -- Market Vectors Coal (KOL) and PowerShares Global Coal (PKOL).

In the pipeline arena, there are some old favorites I first recommended more than 10 years ago, like Magellan Midstream (MMP), Boardwalk (BWP), Enbridge Energy (EEP), Kinder Morgan (KMR), Buckeye (BPL), Enterprise (EPD), Atlas Pipeline (APL), and SemGroup Energy (SGLP). SGLP is slightly different than the others in that it specializes in crude oil and liquid asphalt cement. It transports these to refiners for processing into final products. I see it as a pipeline and an infrastructure build-out play.

Nuclear is a tougher business for me to recommend specific companies in because uranium is about the only “pure play.” Reactor builder Areva (ARVCF.PK) is primarily owned by the French government so they’re our partner, like it or not, and may make decisions based on politics rather than economics (unlike our government, of course!) General Electric (GE) is a big player in next-generation nuclear as well as desalination and a number of other key areas – but their credit and off-balance-sheet exposure keep me away. In uranium, there will always be another prospector with a “story.” They’re a dime a dozen. Cameco (CCJ) is the biggest producer. It, along with Anglo-American (AAUK), are the only two I’ve ever made money on. Your mileage may vary…

Full Disclosure: We are long small positions in ECA, IMO, CHK, NRP, PVR, MMP, BWP, and APL.

The Fine Print: As Registered Investment Advisors, we see it as our responsibility to advise the following: We do not know your personal financial situation, so the information contained in this communiqué represents the opinions of the staff of Stanford Wealth Management, and should not be construed as personalized investment advice.

Also, past performance is no guarantee of future results, rather an obvious statement if you review the records of many alleged gurus, but important nonetheless – especially so you are not over-impressed by the fact that our Investors Edge ® Growth and Value Portfolio has beaten the S&P 500 for 10 years running. What if this is the year we under-perform it?

It should not be assumed that investing in any securities we are investing in will always be profitable. We take our research seriously, we do our best to get it right, and we “eat our own cooking,” but we could be wrong, hence our full disclosure as to whether we own or are buying the investments we write about.

Comments

[Davewmart:]

I completely agree that nuclear power can provide the means to deal with our energy needs if it is given a level playing field.
The coal industry can pollute pretty much at will, whereas the nuclear industry has a regulator that seems to think it's responsibility is to delay and obstruct at every turn and increase costs as much as possible.
In Qinshan Westinghouse is looking at build times of as low as 42 months for a nuclear reactor, and it is building facilities in the States to enable mass production of their very safe, clean designs.
The US regulatory authorities inhibit new designs which can be much smaller, cheaper and more efficient by charging up to $200 per hour for their staff to study any new technology, and licence per site so that a small reactor will pay as much as a large one.
This is a recipe for technological standstill, and would paralyse any industry to which it was applied.
That is not the way America rose to power and influence.
If it wants to compete, then it should direct it's regulatory authorities to facilitate rather than obstruct, whilst of course having due regard to safety - but bearing in mind that the civil nuclear program in the West has about the best safety record of any industry that has ever existed - and that includes wind and solar.
What about waste?
There are several designs which can use this as fuel, turning a burden into a valuable resource.
I like the liquid fluoride thorium reactor, which was demoed successfully in the US in the 60's, and was killed as it was lousy at producing weapons grade materials.
It could use up the waste, be factory produced and plugged straight in to coal burning plants without changing the turbines.
It is around 100-300 times as efficient as present reactors, and could provide all the electrical energy the States use by burning around 500 tonnes of abundant thorium a year!
Waste would be around 85tonnes a year for the whole country, after ten years of storage, and even that would decay to around the levels of the ore from which it came after about 300 years!
More here:
nextbigfuture.com/2009...
America can solve it's problems, if it does what America does best, and vigorously attacks the obstacles head on with a can-do attitude.
If it drifts on in the present manner, then decreasing power and falling behind it's competitors awaits.

Aug 09 07:22 AM

[jerrydd:]

The author manages to get so much right and wrong.

First why would we need more refineries when we don't need the ones we have now? We won't ever use as much oil as he have before as the price is going to rise fast, high. So now the oil industry is shutting down or closing refineries to cut oversupply.

Your drill, baby, drill rant has one small problem, we have little to drill for as not much left. If we do as you say we'll be completely out of oil in 10yrs. I'd rather stretch what we have over a longer time frame.

You seem to think there is an energy shortage for some reason. There is plenty of energy all around you if you are smart enough to catch it. Judging from how uninformed on basic physics, econo101 you are, you may not be smart enough. But I think you are, just letting your bias get in the way and you believe the bull big oil, coal have fed you.

Let's start with our biggest energy resource, eff, conservation. WE can over the next 10 yrs cut our energy use by 50%, enough to make us independent of both coal and imported oil without hurting our lifestyle other than not being wasteful and thinking a little.

For $10k a 1500sq' home can have wind, CSP units to give the eff home all it's power needs, charge an EV and in many cases, sell it back at a profit. Facts are now home wind is only $2k/kw and CSP solar is about $3k/kw plus much heat as a bonus.

I'm not sure what big wind, solar farms energy costs but it's not higher than coal especially if all coal's costs are in it. But home size wind that's lower than coal power is available now though one has to hunt for it. Google axial flux or magnets4less.

I like nukes and if their price can be brought down to $4-6k/kw then yes but now recent bids for plants are in the $9k/kw range and likely to be underbid by as much as all nuke plants in the last 20 yrs have had 50-100% cost over runs. So old nuke, OK, new nuke only if cost effective.

NG is a good thing. It's far cleaner than coal and without the military, economic costs of oil as we have enough. NG will fill the times when RE isn't making power and Semi's, other trucks.

Cars are going electric as it's the only way we can afford them. Why is they use 1/3-1/6 the energy/mile depending on your energy source and one can by wind and/or solar make your own power/fuel. Since EV's are simple, cheap to build, they will in 5 yrs cost no more than ICE's but cost 1/4 to run.

So basically we need to do Obama's energy, transport plan, Cap and Tax oil, coal so they pay all their direct, indirect subsidies, not what congress is doing, with a tax cut from the revenue plus help switching to a stable, inexpensive energy future.

Now compare that to going fossil fuel instead, we'll be broke, owned lock, stock and barrel by big coal, oil, OPEC, Russia and every little oil dictator on earth, continually in oil wars or poisoned by coal. Your choice.

Actually I shouldn't say it's your choice as next yr oil will spike back to $150, even $200bbl and stay there until we go back into recession, then everyone will agree we need off oil. And the invisible hand will sweep down and clear the path for new thinking.

There are no technical problems to do this cost effectively, the problem is political, bought and paid for congress by big oil, nuke and coal who want to keep their huge subsidies, corporate welfare coming their way..

Aug 09 09:12 AM

[oferdror:]

Just to get the numbers straigh: you need 2,000 (not 20,000) acres of land to generate about 1GW of solar electricity. Sunlight hits the ground at an intensity of about 1kW/m^2. That means that at 100% efficiency you would need 1 million m^2 or 250 acres. If you assume about 12.5% efficiency (not a high number by today's standards and we can probably expect double that in time) you get 2000 acres. Not that I think solar power can solve all our prolems. But it is very close to the point (i.e. will be there in less than 10 years) that it can (if the political will exists....) become a major source of electricity (over 10% of US needs).

By the way, even you take your 20,000 acre number, the area needed to provide 100% of US electricity needs (500GW or so) is only about 40,000 kM^2 which is less that 1/2% of the land area of the US. So land is simply not the issue.

Aug 09 09:16 AM

[User 184291:]

In open, flat terrain you have probably under estimated the land needed to build a 1000 MW wind plant by 1/3rd. However you fail to mention that 95% of the land area can continue to be farmed. You don’t lose the land and in fact wind energy provides rural landowners and farmers with a supplemental source of income. A wind plant located on a ridgeline in hilly terrain will require much less space, as little as two acres per megawatt. You can get the facts at: www.awea.org/faq/wwt_e... much land is needed for a utility-scale wind plant

Aug 09 09:34 AM

[Jack Lifton:]

Although I don't usually comment on individual companies I want to say that Cameco is run either by very savvy mining engineers or by bean-counters who listen to their very savvy engineers. Cameco is already half-way to a future in which it will be a diversified supplier of critical material for alternate energy. In this it is way ahead of the pack. Watch this comapny carefully.

Aug 09 09:45 AM

[mark swann:]

I was surprised that no mention was made of ocean thermal energy, by far the largest renewable energy source on our planet. Unlike direct solar or wind, it is available 24 hours a day, night and day, rain or shine. It requires no real estate as the plants float in our subtropical and tropical seas. Its technology derives directly from our mature refrigeration industry and our mature off-shore drilling platform technology. Two of the leaders are Lockheed and Sea Solar Power. The latter's web site is seasolarpower.com.

Aug 09 10:11 AM

[Ferdinand E...:]

Economics and thermodynamics - my best subjects. Thanks for mentioning them. Thanks also for putting in a good word for nuclear, although I think that the TV audience is getting the message at last.

But no thanks for this talk about the huge amount of natural gas in the US. Maybe it is there, but my ears are still in pretty good shape, and until recently all I could hear was that NG buyers are going to be in trouble before long. Of course, things have changed because of the macroeconomy, but I when the directors of some of the largest corporations in North America expressed skepticism about the supply of gas.

By the way Jerrydd, I had hoped to avoid discussing cap-and-trade in my new energy book because I thought that everyone understood that it is strictly wrong, but did I read that you are in favor of it? Don't you know that it has failed in Europe? Am I the only one who knows that?

Aug 09 10:37 AM

[user 31616:]

"There are no near-term alternatives to oil, natural gas, nuclear and coal. Like it or not, the world runs on fossil fuels, and it will for years to come."
Mr.J. Shaefer , I think the technology of Sustainable Power Corp.(SSTP.PK) is the alternative to oil and natural gas.

SustainablePowerCorp.us.

Aug 09 10:49 AM

[Rod Adams:]

In my dozen years or so of working to promote the development of new nuclear power plants, I have learned that the successful opposition to nuclear energy development comes from a rather surprising place. Though there are active and vocal anti-nuclear activists who often get credit for slowing nuclear energy projects, most of them come from a rather powerless part of society. Their opposition could be easily overcome; the same people and groups are not successful when they rant about curtailing fossil fuels or "big box" retail construction projects. However, stopping atomic fission is a money maker that helps many established interests.

The successful opposition to nuclear power plant development really comes from those wealthy and powerful people who stand to lose money if nuclear energy takes market share from fossil fuels. They have worked very hard to raise as many barriers to entry as possible. They know that time is money, so they work to make it take a LONG time to get permission to build. They know that funding is difficult when costs are uncertain, so they helped the Reagan Administration write rules requiring that applicants have to pay the government for the cost of reviewing the required applications and they makes sure that the agency refuses to provide a cost estimate. (Regan's henchmen called those rules "user fees".)

They know that people are worried about costs, so they ask their paid thought leaders to continue to bring up the fact that nuclear plants have high up front costs. They also have worked long and hard to implant the idea of "the economy of scale" into college textbooks to encourage young nuclear engineering students to focus only on "extra large" plants that can only be used by a very small slice of the power consumption market.

My discovery is that the people who sell coal, oil and natural gas are the natural enemies of abundant nuclear energy - they are the ones who lose market share, revenue and power when nuclear energy plants succeed. As you stated, France no longer cowers when OPEC or Russia threaten oil or gas supplies - how do you think that makes OPEC and Russia feel about French nuclear energy strength?

Rod Adams
Publisher, Atomic Insights

Aug 09 10:54 AM

[Ames Tiedeman:]

What needs to be discussed is the fact that Alternative Energy will not be the jobs catalyst that the Obama Administration seems to think. Obama is yet again selling the American people a false promise. The next major jobs catalyst will be healthcare professionals given the aging population over the next 30 years.

Aug 09 11:24 AM

[nakedjaybird:]

Joe et.al: normally, one thinks and writes according to his worldview.

So, instead of arguing and debating the use of fossil fuels any longer, be they nat gas, coal, oil, shale, sands, etc., let's just explore, dig, process and burn all of them until they no longer exist - then we don't have to discuss them any longer - and tell China and India and the rest of the world the same thing.

Problem solved!!!

Aug 09 11:26 AM

[crawlars:]

This has all the markings of a scam.


On Aug 09 10:49 AM User 31616 wrote:

> "There are no near-term alternatives to oil, natural gas, nuclear
> and coal. Like it or not, the world runs on fossil fuels, and it
> will for years to come."
> Mr.J. Shaefer , I think the technology of Sustainable Power Corp.(seekingalpha.com/symbo...)
> is the alternative to oil and natural gas.
>
> SustainablePowerCorp.us.

Aug 09 11:30 AM

[geranz:]

I think we need a crisis in order for the American body politic to understand that a reasoned and very pragmatic approach to energy policy is imperative. I agree that NG is a transitional FF & the infrastructure buildout is much quicker, more efficient and cleaner than the the alternatives (ie. wind, solar, nuclear...etc.) It also allows the economy to continue to run! I am a diehard environmentalist but continue to believe that discounting / dismissing possible solutions at first blush on the basis of possible EIs is not an option for any real progress to take place. I also believe that any policy that does not include nuclear energy production in the mix is not viable in order to fuel any kind of economic expansion!

Aug 09 12:11 PM

[rrbatch:]

A thoughtful and useful sequel to Part I of your essay, thanks Joe. We agree that federal subsidies and regulation are the main impediments to a rational and economic solution to energy supply.

A few points in support of your thesis and investing ideas:

1. I'm retired from the Babcock & Wilcox Company in Lynchburg, VA. B&W produces the fuel elements and other components for all the Navy's reactors that, as you say, have a fifty-year history of incident-free operation. B&W also designed and built the Three Mile Island reactor, and after that fiasco (due as much to operator error as to faulty design) sold their commercial nuclear business to the French. Areva North America continues to operate in Lynchburg and is a leading contender to build new reactors in the U.S. based on a European design. Areva has entered a joint venture with Northrop Grumman (NOC) to build a plant in Newport News capable of fabricating large reactor vessels (NOC also installs the reactors in the Navy's carriers and some of their submarines). B&W recently proposed and submitted a license application for a 100-MW modular commercial reactor that has features that make much environmental and economic sense. B&W is a subsidiary of McDermott International (MDR), which also has interests in the construction of off-shore drilling platforms and boilers and environmental controls for fossil-powered generation plants.

2. Expansion of nuclear power requires facilities to enrich natural uranium with the fissionable isotope U235. The leading source of enriched uranium in the U.S, is USEC (USU), which operates a Cold War-era gaseous diffusion plant in Ohio. USEC has invested $1.5 billion in development of a centrifuge enrichment plant, but was recently denied federal loan guarantees for funding completion of the plant, putting the project and the future of USEC in doubt. Meanwhile, GE has formed a joint venture with Hitachi and Cameco (CCJ) to build an enrichment plant in North Carolina using a laser isotope separation process that has not been demonstrated at commercial scale. These issues must be resolved before expansion of nuclear generation is realistic, and I'm hopeful that they can be resolved without government subsidy.

3. I've had holdings in Chesapeake (CHK) and Penn-Virginia (PVR) for some time, and have ridden the shares down and now up in recovery. PVR has the advantage of diversification between coal properties and a natural gas mid-stream business. PVR and Martin Midstream (MMLP) both throw off nice income streams.

4. Some of your commenters, particularly jerrydd, do not seem to understand the difference between energy and power (the rate at which energy is generated or used). As you point out in your post, wind and solar (and ocean waves) are intermittent sources of both power and energy. A wind farm or solar array can generate multi-MW of power when the wind blows and the sun shines, and can offset some of the energy generated from fossil or nuclear generators, but (apart from massive energy storage facilities) cannot be relied upon to supply power or energy when it's needed. Since wind and solar cannot replace fossil or nuclear plants, their economics are highly dubious.

Aug 09 01:04 PM

[user 31616:]

crawlars I mark you as one big SCAM. When one has no arguments - one posts a garbage in bullboards. Bye basher .

Aug 09 01:30 PM

[Trane250:]

Rod Adams wrote, "My discovery is that the people who sell coal, oil and natural gas are the natural enemies of abundant nuclear energy - they are the ones who lose market share, revenue and power when nuclear energy plants succeed."

You're wrong. The enemies of nuclear power are the ultra liberals. The Shoreham nuclear plant on Long Island is the perfect example. Long Island Lighting spent 21 years (from 1966 to 1987) and 6 billion dollars planning and constructing Shoreham. Shoreham was 100% complete and partially loaded with fuel when Mario Cuomo had it shut down and dismantled. Shoreham would have supplied Long Island with abundant and clean and inexpensive nuclear energy. But Cuomo claimed that Long Island could not be evacuated in case of an accident. What happened? Long Island Lighting went bankrupt and was taken over by a state authority. The folks who live on the island pay some of the highest electric rates in the nation.

Aug 09 01:44 PM

[rrbatch:]

Re: uranium enrichment, I neglected to mention - URENCO (owned by the British and Dutch governments and German utilities) is building a centrifuge enrichment plant in New Mexico, scheduled for initial operation in 2009. To its credit, the DOE turned down the USEC request for a loan guarantee because adequate capacity is planned at the URENCO and GE sites with commercial resources alone. If the GE laser isotope separation process works as planned, it will be less energy intensive and lower cost that the centrifuge process. The DOE Lawrence Livermore Lab, with B&W assistance, tried to develop a pilot laser separation facility in the 1999-2000 period, and abandoned the project as not feasible.

Aug 09 01:45 PM

[jerrydd:]

I understand fully what power and energy is as I actually make it.
What part of $10k for a life time of energy don't you understand? The bull about it's intermittant is just that. When making RE power you use that and when not, use NG. biomass.

Nor is CSP solar limited as it can make power when the sun shines or store it as heat for later use or fire by NG, biomass or any fuel if power or heat is wanted and the sun doesn't shine. Now tell me the grid is not able to handle home RE? It's no more variable than the load is and generators are already in place for [eak power needs.

Now add solar happens at peal power needs and it's worth more than nuke which one can't shut off.

And one can have batteries either in the home or EV or a fueled generator for the few times needed. Like I say, it's an easy tech problem much easier than that of coal or oil use. One poisons us and the other makes us go to war, go broke. Shouldn't these cost be in them?

You all can bellow all you want but RE will kick fossil fuels butt because fossil fuels just plain cost too much as does nuke and going up with a bullet so hold on tight.

Facts are wind generators are simple, cheap and a CSP solar is just a 5hp steam engine and a 200sq' collector. Just how much do you think they will cost once in real mass production in home sizes? There is no reason one can't for under the cost of the cheapest car, get energy for life.

Aug 09 01:48 PM

[realold:]

Great article. Thanks. Reading the comments is enlightening. Greenies cannot listen to anything but what their religion says. Others have open minds and good additional ideas. Thanks for providing this forum.

Aug 09 01:56 PM

[CKWR:]

The pain is that the USA has world wide interests in developing regions that follow the lead of this advanced nation. They all want the high standards of living available in the USA.

Aug 09 02:33 PM

[Old Rick:]

Good article with the exception that the author gives to much credence to the requirement to "sequester carbon". When the AGW concept is proven to be a Statist/Big government hoax in the next 10-15 years, we will look back and wonder how in the world we allowed the religion of AGW to happen.

For jerrydd, you make a few excellent points, especially about conservation, but you lose a LOT of credibility when you engage in personal attacks (" Judging from how uninformed on basic physics, econo101 you are, you may not be smart enough.") with a few loose opinions tossed in. Note that this is the favored tactic of the AGW/enviro crowd right out of Rules for Radicals.

Aug 09 02:39 PM

[Jimbo:]

A provocative, stimulating and thoughtful essay. I can only hope that some of the commenters who submitted critical comments are correct themselves. We are going to need all the help we can get.

Aug 09 02:40 PM

[Old Rick:]

By the way jerrydd, I've been following solar, wind, biomass, etc alternative stuff since (probably) before you were born. In 1972, the solar cell industry was estimating that solar panels would be less than a buck a watt by 1978. Seems it didn't quite happen that way. I am a believer in T. Boone's and Aubrey's CNG ideas, but since the storage tanks required are so large to get a gallon of gas equivalent, it will only work in a smallish area around a CNG refuel station. A home NG refuel station is a good but costly alternative. Note too that the new Honda and VW diesels both get better real-world mileage than the Prius. Hmmmmmmm.

Aug 09 02:54 PM

[Rod Adams:]

Trane250 - You think I am wrong, but offer no evidence indicating why. Since Shoreham is not operating and supplying Long Island residents with low cost electricity, who is supplying the high cost electricity that the residents are now consuming?

Certainly, some of that money is going to pay off the construction loans on a project that was completed, licensed and tested but never operated, but a major portion of the bill goes to pay for diesel fuel and natural gas for the generators that are running 24 x 7 to supply the load. The revenue for the fossil fuel suppliers that are providing what Shoreham could have provided is nearly $2 million per day, more than $500 million per year.

I have not ever done any research on Cuomo to find out who supports his campaigns or where his money comes from, but I can tell you lots about other liberals - starting with the natural gas industry supported Lyndon Johnson, and the coal industry supported Robert Byrd.

By the way, there are also plenty of conservatives who owe a lot to the fossil fuel industry who have never done any favors for nuclear energy. The first Atomic Age started grinding to a halt when the Atomic Energy Commission got split into a regulator that had no mission of ensuring reliable energy and a research and development agency whose leaders were conflicted by a need to support all energy sources. That happened during the Nixon years. Ever notice how many nuclear plants got built during 12 years of Reagan-Bush the First or 8 years of Bush the Second? Rhetoric does not count as support - actions speak louder.

Rod Adams
Publisher, Atomic Insights

On Aug 09 01:44 PM Trane250 wrote:

> Rod Adams wrote, "My discovery is that the people who sell coal,
> oil and natural gas are the natural enemies of abundant nuclear energy
> - they are the ones who lose market share, revenue and power when
> nuclear energy plants succeed."
>
> You're wrong. The enemies of nuclear power are the ultra liberals.
> The Shoreham nuclear plant on Long Island is the perfect example.
> Long Island Lighting spent 21 years (from 1966 to 1987) and 6 billion
> dollars planning and constructing Shoreham. Shoreham was 100% complete
> and partially loaded with fuel when Mario Cuomo had it shut down
> and dismantled. Shoreham would have supplied Long Island with abundant
> and clean and inexpensive nuclear energy. But Cuomo claimed that
> Long Island could not be evacuated in case of an accident. What happened?
> Long Island Lighting went bankrupt and was taken over by a state
> authority. The folks who live on the island pay some of the highest
> electric rates in the nation.

Aug 09 03:11 PM

[Bruce Vande...:]

I know it is not politically popular but simply raising the tax rate on gasoline is the best road (sorry it was inadvertent) to conservation. "Cash to Clunkers" and other government programs are more show than anything else. When prices rise each individual will decide on how he/she can best conserve.

Aug 09 03:32 PM

[auto44:]

You must be one of those starry eyed tourist the author refered to.


On Aug 09 09:12 AM jerrydd wrote:

>
> The author manages to get so much right and wrong.
>
> First why would we need more refineries when we don't need the ones
> we have now? We won't ever use as much oil as he have before as the
> price is going to rise fast, high. So now the oil industry is shutting
> down or closing refineries to cut oversupply.
>
> Your drill, baby, drill rant has one small problem, we have little
> to drill for as not much left. If we do as you say we'll be completely
> out of oil in 10yrs. I'd rather stretch what we have over a longer
> time frame.
>
> You seem to think there is an energy shortage for some reason. There
> is plenty of energy all around you if you are smart enough to catch
> it. Judging from how uninformed on basic physics, econo101 you are,
> you may not be smart enough. But I think you are, just letting your
> bias get in the way and you believe the bull big oil, coal have fed
> you.
>
> Let's start with our biggest energy resource, eff, conservation.
> WE can over the next 10 yrs cut our energy use by 50%, enough to
> make us independent of both coal and imported oil without hurting
> our lifestyle other than not being wasteful and thinking a little.
>
>
> For $10k a 1500sq' home can have wind, CSP units to give the eff
> home all it's power needs, charge an EV and in many cases, sell it
> back at a profit. Facts are now home wind is only $2k/kw and CSP
> solar is about $3k/kw plus much heat as a bonus.
>
> I'm not sure what big wind, solar farms energy costs but it's not
> higher than coal especially if all coal's costs are in it. But home
> size wind that's lower than coal power is available now though one
> has to hunt for it. Google axial flux or magnets4less.
>
> I like nukes and if their price can be brought down to $4-6k/kw then
> yes but now recent bids for plants are in the $9k/kw range and likely
> to be underbid by as much as all nuke plants in the last 20 yrs have
> had 50-100% cost over runs. So old nuke, OK, new nuke only if cost
> effective.
>
> NG is a good thing. It's far cleaner than coal and without the military,
> economic costs of oil as we have enough. NG will fill the times when
> RE isn't making power and Semi's, other trucks.
>
> Cars are going electric as it's the only way we can afford them.
> Why is they use 1/3-1/6 the energy/mile depending on your energy
> source and one can by wind and/or solar make your own power/fuel.
> Since EV's are simple, cheap to build, they will in 5 yrs cost no
> more than ICE's but cost 1/4 to run.
>
> So basically we need to do Obama's energy, transport plan, Cap and
> Tax oil, coal so they pay all their direct, indirect subsidies, not
> what congress is doing, with a tax cut from the revenue plus help
> switching to a stable, inexpensive energy future.
>
> Now compare that to going fossil fuel instead, we'll be broke, owned
> lock, stock and barrel by big coal, oil, OPEC, Russia and every little
> oil dictator on earth, continually in oil wars or poisoned by coal.
> Your choice.
>
> Actually I shouldn't say it's your choice as next yr oil will spike
> back to $150, even $200bbl and stay there until we go back into recession,
> then everyone will agree we need off oil. And the invisible hand
> will sweep down and clear the path for new thinking.
>
> There are no technical problems to do this cost effectively, the
> problem is political, bought and paid for congress by big oil, nuke
> and coal who want to keep their huge subsidies, corporate welfare
> coming their way..

Aug 09 04:36 PM

[auto44:]

You don't think half our land area is a big issue???????????????


On Aug 09 09:16 AM oferdror wrote:

> Just to get the numbers straigh: you need 2,000 (not 20,000) acres
> of land to generate about 1GW of solar electricity. Sunlight hits
> the ground at an intensity of about 1kW/m^2. That means that at 100%
> efficiency you would need 1 million m^2 or 250 acres. If you assume
> about 12.5% efficiency (not a high number by today's standards and
> we can probably expect double that in time) you get 2000 acres. Not
> that I think solar power can solve all our prolems. But it is very
> close to the point (i.e. will be there in less than 10 years) that
> it can (if the political will exists....) become a major source of
> electricity (over 10% of US needs).
>
> By the way, even you take your 20,000 acre number, the area needed
> to provide 100% of US electricity needs (500GW or so) is only about
> 40,000 kM^2 which is less that 1/2% of the land area of the US. So
> land is simply not the issue.

Aug 09 04:38 PM

[Alan von Al...:]

I didn't want to take any notice of jerrydd, however enough is enough. There aren't going to be any solar-powered aircraft or biomass-powered missile cruisers. Nor are we going to scrap the commercial transport fleet to retrofit Peterbilts and diesel locomotives to burn natgas and crawl over the Rockies at 5 mph, carrying half as much freight.

Use 'renewable' if you want. But don't pretend you're self-sufficient. It can't exist or function without oil power for mining, manufacturing, transport, public safety and national defense. It's absurd to claim that government subsidizes oil. You have it exactly backward. Oil producers pay royalties and taxes to the Feds, the producing states and localities, plus the paychecks and benefits of millions directly and indirectly employed.

On Aug 09 01:48 PM jerrydd wrote:
> You all can bellow all you want but RE will kick fossil fuels butt
> because fossil fuels just plain cost too much

Aug 09 05:20 PM

[untrusting ...:]

Interesting ... liquid fluoride thorium reactor. Had not seen anything on these, but also never looked before either. Sounds like they offer some real promise. Hopefully the industry is presenting information on this alternative to the new Energy Secretary, as he is a pretty knowledgable scientist. The issue is as always, politics and vested self-interest by business and the wealth holders. Sure would be great to have politicans actually make a few major decisions that really help the longer term interests of the country instead of cater to political and vested business interests. Ahhhh just more wishfull thinking.

On Aug 09 07:22 AM Davewmart wrote:

> I completely agree that nuclear power can provide the means to deal
> with our energy needs if it is given a level playing field.
> The coal industry can pollute pretty much at will, whereas the nuclear
> industry has a regulator that seems to think it's responsibility
> is to delay and obstruct at every turn and increase costs as much
> as possible.
> In Qinshan Westinghouse is looking at build times of as low as 42
> months for a nuclear reactor, and it is building facilities in the
> States to enable mass production of their very safe, clean designs.
>
> The US regulatory authorities inhibit new designs which can be much
> smaller, cheaper and more efficient by charging up to $200 per hour
> for their staff to study any new technology, and licence per site
> so that a small reactor will pay as much as a large one.
> This is a recipe for technological standstill, and would paralyse
> any industry to which it was applied.
> That is not the way America rose to power and influence.
> If it wants to compete, then it should direct it's regulatory authorities
> to facilitate rather than obstruct, whilst of course having due regard
> to safety - but bearing in mind that the civil nuclear program in
> the West has about the best safety record of any industry that has
> ever existed - and that includes wind and solar.
> What about waste?
> There are several designs which can use this as fuel, turning a burden
> into a valuable resource.
> I like the liquid fluoride thorium reactor, which was demoed successfully
> in the US in the 60's, and was killed as it was lousy at producing
> weapons grade materials.
> It could use up the waste, be factory produced and plugged straight
> in to coal burning plants without changing the turbines.
> It is around 100-300 times as efficient as present reactors, and
> could provide all the electrical energy the States use by burning
> around 500 tonnes of abundant thorium a year!
> Waste would be around 85tonnes a year for the whole country, after
> ten years of storage, and even that would decay to around the levels
> of the ore from which it came after about 300 years!
> More here:
> nextbigfuture.com/2009...
>
> America can solve it's problems, if it does what America does best,
> and vigorously attacks the obstacles head on with a can-do attitude.
>
> If it drifts on in the present manner, then decreasing power and
> falling behind it's competitors awaits.

Aug 09 06:29 PM

[maryanne:]

We need to be domestically self sufficient in energy like Brazil. I have solar panels on my house (half paid by California rebate) Coal CAN BE made cleaner and capture the CO2. Excellent article.

Aug 09 08:13 PM

[jerrydd:]

We'll see late next yr when gasoline is back at $4/gal, coal doubled in price and NG the same what you think then.

My numbers are correct and those betting oil over 10 yrs better be careful as RE about then will set the energy costs, ceiling.

I'm not some wide eyed greenie but a fiscal conservative who happens to have made my own RE equipment and through my boat, other production experience knows what things like these cost to produce. Those who refuse to see basic cost reductions in energy once RE is wide spread will get hurt betting against them.

Aug 09 09:05 PM

[AndyMan:]

I think most of us have come to the conclusion that wind and solar are not yet viable alternatives yet.....and I agree with the author that we should remove all subsidies and see which come to the top. That goes for everything...not only energy related.

But it seems as though the stock recommendations are somewhat making bets on which fuel we are going to use in the future.....and I am sure some will be good bets (I invest in NG, oil, coal, uranium producers) but wouldn't it be a better bet to just bet on electricity demand increasing? If this is so, wouldn't companies that produce electricity benefit? They also would benefit from any advances in energy gathering/way of producing energy.

The only downfall I can think of is energy efficiency reducing demand. But if we do go to electric cars, I would imagine they would be a gold mine for an investment opportunity....and they also provide solid dividends.....plus with all the money printing going on, they typically hold a lot of debt....and they can pay this debt down with a currency which is consistently going down. icing on the cake.

So it doesn't matter what power source is used....we need power....and if electricity demand increases...we win as investors. Anything I am overlooking?

And in terms of efficiency.....thinking out of the box here. We spend a lot of the energy on moving a car and person......the car itself takes a lot of energy to move, perhaps the car and even the person doesn't need to be moved, but only the items? What if we make a infastructure where only goods are transferred from place to place...it could be a magnetic train set up, a compressed air set up, fossil fuel based, electrical, whatever. This would cut down demand HUGE. We could basically order everything over the phone or internet.

Aug 09 10:35 PM

[Mike Keller:]

Renewable energy is essentially just another variation on the socialist “re-distribution of wealth” program. The government removes money from consumers and puts it in the hands of the undeserving (non-competitive) while politicians exploit the situation to buy votes.

Without massive subsidies and government mandates, investors would not finance renewable energy projects, as has been demonstrated on numerous occasions over the years. Indeed, even with massive subsidies, renewable energy is hard pressed to compete in the market place.

The financial underpinnings of renewable energy are fundamentally not sound. Because renewable energy is unable to provide energy when needed, the value of the product in the market place is not as great as those processes that can supply the energy when called upon.

Adding further injury to the abused consumer, utilities must invest in standby power to cover loads when fickle renewable energy is unable. Thus costs are driven even higher. Don’t believe it? Go see the Bonneville Power Authority’s website for a real world example.

Given the low value of renewable energy, the only way profits can occur for renewable energy providers is by government intervention. Looks like a socialist duck, walks like a socialist duck and quacks like a socialist duck.

Aug 09 10:36 PM

[Jigar Shah:]

It's easy to say these things, but renewable energy is inevitable. In 2008, 56% of all new capacity additions in the US were from zero-emission sources. Today, the cost of new coal, new nuclear, and new natural gas facilities are raising rates at between 5-12%. that is alot of money. It is so easy to grow up thinking that coal, nuclear, and natural gas (yes ask Texas residents) are cheap. Read the data, not the hype:

Wise County Virginia Coal plant rate increase: www.sourcewatch.org/in...

Duke Indiana Coal plant: 18% rate increase
www.zeuslibrary.com/VE...

Progress Nuclear Plant
suncoastpasco.tbo.com/.../

Wisconsin Coal plant: gazetteonline.com/...

West Virginia Coal: gristmill.grist.org/st...

In stark contrast, out of work electrical contractor, roofers, HVAC contractors, and handymen can install solar, smartgrid, ice storage units and energy efficiency measures for less than a 4% rate increase -- a real bargain compared to new coal and nuclear. One more point on nuclear power, the only that old nuclear is cheap now is that after 200% cost overruns in the 1970s, the utilities raised rates to pay off the bonds early. Now that they are paid off they are "cheap". I could make the exact same argument for solar, wind, and other technologies that are mostly capital costs.

Aug 09 10:51 PM

[ArtfulDodger:]

Mr. Shaefer:

The US imports a ton of oil from Canada, which neither you nor most writers mention when they're speaking of our dependence on foreign oil.

Many months the US receives more from Canada than Saudi Arabia. Does anyone mind that?

In respect to your statement that the American people don't want to drill in national parks etc., the polls last year showed that over 80% did want to drill there and offshore.

It's mainly the eco-maniacs and kooks and elected officials that they lobby so viciously that don't want us to drill in those places.

Thank you for the article. Overall, especially the companies you suggest investing in, it is very worthwhile.

Aug 09 11:50 PM

[Road Runner:]

In all of this discussion, an important point may have been lost. There are generally 2 worlds of energy production and consumption that mostly don't cross: 1) oil which goes into mostly transportation fuels for "things that move", and 2) most other sources of energy that go into the electric grid, or used directly like natural gas, for "things that don't move". Heating oil is one of the few "cross over" products of oil that goes into heating homes, and natural gas is used for some vehicles.

The biggest issue that faces the US, and the rest of the world, is the coming shortage of oil. To use all the possible sources of energy mentioned in his discussion for “things that move”, something very important needs to be developed – high-energy, safe, and inexpensive batteries for plug-in vehicles. Without these batteries all the nuclear power and solar and wind, etc. that we can produce will not address the coming oil shortage. That is why battery technology is key, should be watched closely, and should be promoted.

Fortunately, battery technology is moving along a good pace due to large amounts of investment and technical breakthroughs. The advanced Lithium technology of Lithium Iron Phosphate (LiFePO4) looks most promising to me. The major companies, in my opinion, are A123 soon to have an IPO, and BYD of China.

There are multiple other promising battery technologies. GE is investing heavily in liquid Sodium batteries for its locomotives, and for stationary storage for leveling wind and solar energy sources. Lead Acid battery companies are improving the long time workhorse with a Lead-Carbon technology.

Aug 10 12:17 AM

[Kunst:]

The US used to be the world's largest exporter of oil. Don't you wish we had that oil now? When things get difficult enough, we'll be glad we didn't suck all the oil out of Alaska and the continental shelf.

Aug 10 12:38 AM

[jockum:]

dollar ponzi, ponzi, let us have a universal currency based on hydrogen. A hydrogen standard currency. I bet you´ll soon find economies quickly focusing on how to produce and store hydrogen really cheap in order to grow more quickly. And yes, let us reforest. So that the hydrogen may react to oxygen- to produce water. Hmmm, the now bankrupt Island, may then actually be one of the richest countries in the world. (yes they are building a hydrogen plant- that use thermal energy).

Aug 10 03:46 AM

[Kodi:]

Fossil fuels are ancient solar energy, let's not forget that. Eons ago, plants and animals utilized solar energy to assimilate the CO2 in their atmosphere to grow and prosper and eventually become entrapped in what we now use as energy. Had their "carbon footprint" not been sequestered, the earth's atmosphere would have already compensated for their carbon release through decay, rather than being released eons later.

It is similar to the arguement about whether a pile of brush releases more carbon dioxide by burning or by rotting over time. In either case, they release the same. Burning accomplishes this in hours, decomposition takes decades.

The obvious difference is that we are releasing massive amounts of CO2 on a yearly basis, but let's not forget that a single volcanic eruption far surpasses what mankind contributes.

My guess is that the ecosystem of the earth has far more compensatory mechanisms than we realize. We just haven't realized this yet.

Aug 10 07:32 AM

[MichaelJ007:]

The Oil, NG and Coal buried in the sands and shores of the US essentially become more valuable as worldwide reserves continue to deplete. We have a very gluttonous and wasteful lifestyle when it comes to energy- b/c it's still pretty cheap despite the occasion price jumps. I say we keep importing the relatively cheap fossil fuels, get our renewable energy and nuclear infrastructure and technologies up to speed, and leave all the developing nations to squabble over what's left in the middle east and russia while we sip from our shales that we saved over the decades. For once we could be the ants rather than the grasshoper.

Aug 10 09:26 AM

[John Petersen:]

Another great article that only leaves one bone to pick. Coal and nuclear have to run 24/7 at stable levels or they break. NG can ramp up or down at the whim of the operator. To maximize the efficiency of base-load coal and nuclear, we need to get to cost effective energy storage so that none of the excess electricity is sent to ground. Then we can rely on a combination of NG, wind, solar and more storage to take care of daily and seasonal power demand peaks. Regardless, we need every tool in the box and a number that have not been invented yet. Thanks for taking a rational macro approach to a problem that most want to ignore.

Aug 10 10:09 AM

[41justice:]

I enjoyed all the suggestions for improving our energy profile. I cannot say which is the most viable but rather suggest that we should use all options with emphasis based on local conditions. Wind where it blows more consistently, solar where more sunshine and open land is available and natural gas where it can be economically supplied. While clean coal has not been fully achieve, modern plants generate far less pollution than yesteryear. No matter what we do, China, India, and other countries are building coal fired plants as fast as they can. Cap and Trade on our part will not have any appreciable effect on global pollution and carbon emissions. Work together guys, we need all of you.

Aug 10 01:51 PM

[lohwengk:]

Yes, one of those mechanisms is called "extinction".


On Aug 10 07:32 AM Kodi wrote:

> My guess is that the ecosystem of the earth has far more compensatory
> mechanisms than we realize. We just haven't realized this yet.

Aug 10 03:53 PM

[Edvishnu:]

You hit the nail on the head!!! All this other whining is bullshit.
Youve articulated what should be our nations energy strategy.

Aug 10 05:03 PM

[Rod Adams:]

John - FYI - I spent 40 months as the engineer officer on board a 27 year old nuclear submarine that was able to jump from all stop to flank (100% power) in less than 60 seconds.

If commercial nuclear plants cannot respond to load changes it is NOT because they are nuclear, but because they are very large and designed to be operated with only slowly changing power levels. Fission itself is EXTREMELY responsive. Been there, seen that.

Rod Adams
Publisher, Atomic Insights


On Aug 10 10:09 AM John Petersen wrote:

> Another great article that only leaves one bone to pick. Coal and
> nuclear have to run 24/7 at stable levels or they break. NG can ramp
> up or down at the whim of the operator. To maximize the efficiency
> of base-load coal and nuclear, we need to get to cost effective energy
> storage so that none of the excess electricity is sent to ground.
> Then we can rely on a combination of NG, wind, solar and more storage
> to take care of daily and seasonal power demand peaks. Regardless,
> we need every tool in the box and a number that have not been invented
> yet. Thanks for taking a rational macro approach to a problem that
> most want to ignore.

Aug 10 08:12 PM

[realityrese...:]

Joseph
You are careful not to mention the Chernobyl Incident and the still dynamic tectonics of the earth itself. The US Navy operates small reactors in a 100% self-contained environment under military discipline and procedures; a point that is lost on those who use it as an example of "safe" atomic power. Civilians are incapable of this level of diligence.

The reports on The Future of Geothermal Energy are several and available, it can conceivably provide a level of efficiency equal to or greater than what we are currently using without pollution or radioactive waste. The fact that it has largely been ignored for decades says a lot about the interest groups and lobbyists that control public policy in our country.

Aug 10 11:21 PM

[Gary K:]

I would like an answer to a question.Please look at the attached Photo of my gasoline vaporizer.With the aid of a low pressure air compressor, vaporized gasoline at 100 parts of air to 1 part of fuel,intended to power an engine, is instead safely ignited, to prove that it actually works.Notice the colors of the flame.It goes from blue to yellow to orange.This is the very same flame color pattern of a bic butane lighter.This is proof that there is really no difference between butane and gasoline.With vaporized gasoline, even the largest SUV could easily get 50 + MPG, and emit a fraction of the emissions of an EPA-OBD II mandated fuel system, which operates at 14.7 parts of air to 1 part of fuel.Also, with vaporized gasoline, there's an increase in power, as well as much longer engine life.Also, the resulting Flame has a much lower combustion temperature than natural gas, or propane, both of which burn blue.Hydrogen burns even hotter.The problem with such a high combustion temperature is that an engine has to be modified to withstand it.Again, not so with safely vaporized gasoline.In the past, vaporizers relied on heat to function.With the additives in today's fuel, that's all but impossible.My unit uses low pressure air to do it's thing.But there is another problem.All gasoline powered vehicles from 1996 to the present, are required to pass the EPA-OBD II vehicle emissions inspection.All such vehicles have on board oxygen [O2] exhaust sensors.These O2 sensors are set up to detect a level of polluting exhaust emissions that would indicate that fuel is being metered into the engine at 14.7 parts of air to 1 part of fuel.This is detected by the level of polluting exhaust emissions, when a vehicle is connected to an OBD II emissions analyzer for it's annual emissions inspection.Anything below 14.7 / 1 would result in an excess level of polluting exhaust emissions being generated.This will result in a failed emissions inspection, as well it should.But, with a vaporized fuel mixture, of 100 parts of Air to 1 part of fuel, the result will be far less polluting exhaust emissions.O2 sensors are incapable of registering anything far above the established resulting emissions of air/fuel Ratio of the14.7/1 level.An O2 sensor failure code will result, if such a vehicle is connected to an OBD II emissions inspection analyzer.O2 sensor exemptions are granted for vehicles that have been legally converted to operate on natural gas, propane, or hydrogen, and are registered as such.But no such exemption exists for vaporized gasoline.Thus, it is entirely possible for a vehicle, 13 years old, or newer, to fail an emissions inspection, for not emitting enough polluting exhaust emissions ! And the "Clunker Bill" is the next step in eliminating older vehicles that can legally operate on vaporized gasoline.I'm convinced that alternative use of conventional energy, at least in the short term, is the way to go.If some of the excess profits from petroleum could, with vapor fuel technology, be redirected, then we could finally move on to safe, clean, affordable, renewable energy.And the big oil corporations, with big government in their pockets,are going to fight this every way they can! For even more insight, do a search on [the late] Tom Ogle.Then, go to energy21.freeservers.c... . Scroll on down the Page, and check out the last few paragraphs.Until this insane EPA-OBD II Law, that only benefits big oil is changed, the only way to make vehicles more "efficient" will be to make them smaller and lighter. I have contacted, and joined the new Administration's site, change.org and they're too busy to be bothered with it.Likewise friendsoftheearth.com , [e-mail] and many other environmental organizations as well. Not one of them, nor any politician, can, or will answer my question ; " Why is it illegal for any vehicle, 13 years old, or newer,to emit too little polluting exhaust emissions " ? I'm not trying to sell anything.But I must ask, if you truly care about the environment, can you answer my question ? No one else seems to be able to do so. Thanks ! Gary

Aug 11 03:08 AM

[toobad41:]

Thanks Joseph for the two fine articles. You told it as it is and how it will be. I don't think people realize how very important fossil fuels have been in their lives and to civilization. I dare say I won't be around in twenty years but I can tell you this...the world will be a lot different than it is today and those that are still here won't like it. People born today will not inherit the world of today but will only read about it in history books. That is if we have enough trees left to make history books. Most of my life as been dedicated to the fossil fuel industry and that won't change. We are running out of fossil fuels and that too won't change. With that said we have absolutely nothing else to fall back on. Nothing else will replace what will be gone. Nothing.

Aug 11 10:11 AM

[jerrydd:]

Gary K your vaporizer is a scam. The only thing it vaporizes is the money in your customers pockets.

You can program any amount of fuel with a fuel injection systems and auto companies have found their best points as it costs them dearly if they don't.

Just 1mpg costs them $millions/model so they would do your levels if they worked but don't. Your pics don't show 100-1 ratios because those ratios, gasoline won't burn. That is a long proven fact.

The real way to eff transport is EV drive, 10-50mile range battery pack with a small, 10hp/1000lbs, generator running almost full power is 3x's as eff as present vehicles. As more simple, can cost less too.

My EV's get 250mpg equivalent for my sportwagon and 600mpge for my Harley size EV trike. If you want real economy, you need EV drive. An EV gets 20-60% of it's source power plant's fuel to the road vs ICE's that only get 7% from gasoline, 9% from diesel. Now add one can make their own fuel from many different ways with oil prices rising and EV, plug in hybrid prices dropping in 5 yrs they will be little reason to by ICE drive vehicles like $5-8/gal gasoline.

Aug 11 10:13 AM

[Tom Morrow:]

Are you kidding me? We could easily save 15% - 20% of current energy expenditures by simply "turning off the lights". I live in the northeast where neighbors let their cars run 20 minutes before leaving in the morning. This is insanity during an energy crisis. We are NOT dependent on oil. We're dependent on owning the individual auto which is the most irrational economic decision in history. Who thinks that having a 1.5 ton machine carry around a 180 pound person using a scarce resource is sane?
Get a grip.

Aug 17 06:15 PM