Old Wizard

Energy Secretary Chu Wimps Out Again

Fitz, I believe that the administration is starting to realize that the energy plan,and I am being diplomatic, on which it has embarked does not address the country's fundamental problem, it.s increasingly negative operating cash flow. Since importation of oil accounts for anywhere from 33 to 50 %, negative trade balance with China accounts for about 33% and the rest with various other countries, the path they had started offers little promise for oil reduction before 2030 the potential for Chinese electric battery production and even ultimately cheap PHEVS , more advanced vehicles from Germany than the Volt and a near term failed job creation from their energy plan, they should be nervous. Hence the 2.5 b investment in petrobras, the rethinking on fleet vehicles and natural gas and at least keeping their options open. As I said before,goals like doubling electrical energy from wind and solar in 3 years and clean coal, 25 % of cars being electric by 2030 have no urgency and relatively little affect on our most pressing economic problem.

Making Natural Gas Transportation a Reality

Fitz, As you have been predicting, the price of oil is going up. This combined with a new impetus on ethenol by the Gov and the printing of money by the treasury will lead to a commodity and food price upward spiral like we experienced early last year. For a highly leveraged economy this spells bad news. The deleveraging the country has experienced to date is only half way to where it has to go and a price upward spiral on basic commodities at this point is double trouble. We are on the verge of being at the same place as this time last year and lost a valuable year without the definition of coherent and urgently needed and articulated process for correction. In the interest of satisfying his single issue constituencies the president has not applied the necessary time constraints and consequently, not focused his programs[funding] and his political speak on the first bullet aimed at the country's economic head.

Making Natural Gas Transportation a Reality

Fitz and pragmatist. I think the three of us agree on the path forward, but the announcement this morning that GE, a company in which I labored for a long time and hold too much stock, just announced plans to build a new battery manufacturing plant in the US is another disturbing sign. The CEO is one of Presidents economic advisors. This coming from a company which is still cash strapped and wants to sell its appliance business. Given that many US battery makers are struggling and the existing imposing foreign competition, this announcement portends a greater Gov push on electric vehicles, does it not? On the plus sign, AT&T has gone public with ads, featuring their natural gas-driven truck program that highlights the positive effects on the environment.

Making Natural Gas Transportation a Reality

Maybe the Obama administration has gone for the bifuel compromise, but there seems to be some counter evidence in recent events and announcements. 1] Ford, which might be the only US viable American automobile company left standing, just announced a massive investment to convert a truck plant to ev automobile production by 2011. Would Ford make a commitment like this if they thought that CNG was in the Administration's plans? 2] None of the stimulus money is directed toward supporting technology or implementation of natural gas conversion. 3] None of the discussions surrounding GM's future are centering on a thrust to natural gas driven vehicles which GM already can produce. If the administration has any intention of implementing a bi-fuel solution, where is the tangible evidence? It is not surprising that Senator Obama would support the natural gas thrust and President Obama has yielded to the purist environmental constituency. As all the pundits continuosly remind us, 'that's politics". Too bad we can't have real problem solving for a change. The announcement that one can now rent a mini cooper pure ev for $862/ month and 462 people have already signed up, just reported by local radio, is another testimony that articulation by a charismatic figure will induce some people to act regardless of the wisdom or economic implications of the act. That is why the national leadership should be more thorough in its analysis and articulate more well thought out solutions to the country's problems.

Making Natural Gas Transportation a Reality

Fitz, I want to congratulate you on not only your article, but on your responses to some of the negative comments. It is obvious that some of the commentators don't understand our fundamental economic structural problem and, therefore, don't buy into the need to replace the oil we import from questionable sources with a commodity we provide ourselves. They do not buy into the 5 to 7 year time constraint; so let me take a crack at it. Let's assume there are app. 130 m passenger cars in the US and 2m trucks, buses and other vehicles. For purposes of this exercise, let's assume that passenger cars are replaced after 10 years of life and that the replacement rate is linear[13m/yr]. For simplicity and environmental purism, let's assume that the industry produces all electric vehicles that are affordable and attractive to support the replacement rate assumed by the beginning of 2012. By this computation half the passenger cars would be all electric by seven years from now. Trucks, buses and other vehicles would be assumed to be not electric.In seven years at the current rate of expansion of wind and solar as predicted by the president, the amount of electricity provided by these sources would be about 8% of current generation capacity and would not provide the capacity to recharge the 65 million passenger cars. Now since the electric cars that are provided out of the gate won't appeal to many, the linear replacement rate is optomistic. The state of affairs at the end of 2016, under these assumptions would be that over half the vehicles on the road would still use gasoline, existing coal and oil-fired electrical generation plants would still exist and the operating cash flow of the country would still be in the range of .5 to 1 trillion negative. Over the seven years to get to this point, the country, will ship almost 2 trillion dollars abroad, buying imported oil. The above assumes an average price of oil of $80/ barrel over the seven years. Since the car companies are assuming sales of 10m cars/year or less rising slowly to perhaps 13 million/yr in the US in 4 years, the linear replacement rate is vert optomistic. The bottom line is that the pure electric car solution is not very feasible as a 5 to 7 year solution to our strategic or economic problems and our economic and strategic energy dependence problems can't wait til 2020 or 2030 for a solution. Any reasoned analysis that is much more substantive than the above will most likely yield an even more long term horizon for the purest solution and spells great difficulties for the future of our country.

A Natural Gas Centric Strategic Long-Term Comprehensive Energy Policy

Sorry about the glich, our operating cash flow as a country has been increasingly negative since1991. On top of that we are running increasingly negative domestic budgets. For the most part, we borrow the money to balance our budget from the countries who have positive operating cash flows like China,the Mid east oil producers and some countries in western europe. If a company keeps having this situation it would probably file for bankruptcy. As you have pointed out, a significant contributor to this economic problem is energy import. The current administration can't seem to get to the heart of the ultimate problem and therefore thinks that greenhouse gas is the real imminent threat to the future of the US and that they have 30 years to solve the problem. Unfortunately, if the USA doesn't solve the basic cash flow problem in the next ten years, the whole environmental issue might be academic as far as the quality of life for our progeny is concerned. Replacing today's electrical generation capacity with natural gas generated electricity will reduce green house gases but won't help our cash flow as a country. That is why we need to work the gasoline part of the problem first. The president is still talking about clean coal but I believe this a political gambit to assuage the miners and other workers. The trurth is that he knows that replacing the coal-fired facilities is not even close to the horizon. I was surprised by your transportaion oil usage, I thought it was 40% of our total usage, maybe that was only for passenger cars. Today's electrical generation from wind and solar is less than !% of the total and the president's goal is to double this in three years, hardly a sense of urgency, hence fitz's comment that insisting on relying on this form of energy will only lead to more green house gases in the foreseeable future. We had a golden opportunity to step up the introduction of solar and wind with a focused Gov plan and stretch goals for five and ten years but chose to buckshot the money into a myriad of things with no focus,no concrete goals and a relatively naive set of objectives that satisfy single variable constituencies. This may be good politics, but it isn't solving our critical problem. By the way supplanting importation of oil for the importation of lithium won't solve our problem either. I believe that the conversion to gas fueled vehicles will pick up momentum in spite of the Government. As you have stated trucks which enter the port of Long Beach must be natural gas powered, AT&T has announced a 600 m+ program to convert and refleet their commercial vehicles to natural gas powered and some few states are moving that way. Long Beach by the way is the port of entry of about 60% of imported goods from the far east and a major entry point for Walmart's goods.Getting Walmart to convert their trucks to natural gas would really be a green initiative.

A Natural Gas Centric Strategic Long-Term Comprehensive Energy Policy

Sorry about the glich, our operating cash flow as a country has been increasingly negative since1991. On top of that we are running increasingly negative domestic budgets. For the most part, we borrow the money to balance our budget from the countries who have positive operating cash flows like China,the Mid east oil producers and some countries in western europe. If a company keeps having this situation it would probably file for bankruptcy. As you have pointed out, a significant contributor to this economic problem is energy import. The current administration can't seem to get to the heart of the ultimate problem and therefore thinks that greenhouse gas is the real imminent threat to the future of the US and that they have 30 years to solve the problem. Unfortunately, if the USA doesn't solve the basic cash flow problem in the next ten years, the whole environmental issue might be academic as far as the quality of life for our progeny is concerned. Replacing today's electrical generation capacity with natural gas generated electricity will reduce green house gases but won't help our cash flow as a country. That is why we need to work the gasoline part of the problem first. The president is still talking about clean coal but I believe this a political gambit to assuage the miners and other workers. The trurth is that he knows that replacing the coal-fired facilities is not even close to the horizon. I was surprised by your transportaion oil usage, I thought it was 40% of our total usage, maybe that was only for passenger cars. Today's electrical generation from wind and solar is less than !% of the total and the president's goal is to double this in three years, hardly a sense of urgency, hence fitz's comment that insisting on relying on this form of energy will only lead to more green house gases in the foreseeable future. We had a golden opportunity to step up the introduction of solar and wind with a focused Gov plan and stretch goals for five and ten years but chose to buckshot the money into a myriad of things with no focus,no concrete goals and a relatively naive set of objectives that satisfy single variable constituencies. This may be good politics, but it isn't solving our critical problem. By the way supplanting importation of oil for the importation of lithium won't solve our problem either. I believe that the conversion to gas fueled vehicles will pick up momentum in spite of the Government. As you have stated trucks which enter the port of Long Beach must be natural gas powered, AT&T has announced a 600 m+ program to convert and refleet their commercial vehicles to natural gas powered and some few states are moving that way. Long Beach by the way is the port of entry of about 60% of imported goods from the far east and a major entry point for Walmart's goods.Getting Walmart to convert their trucks to natural gas would really be a green initiative.

A Natural Gas Centric Strategic Long-Term Comprehensive Energy Policy

Hi Fitz, Incorporating a near term goal in your plan as I have suggested is a necessary addition, since it drives out pie in the sky alternatives. What many of the folks who look at the energy problem don't do is relate it to our economic structural problem. What should alarm every citizen is the fact that our operating cash flow as a country na

H.R. 1835: Legislation for Natural Gas Transportation

I think most of us believe in wind and solar renewable energy. The trouble is that much of our political machinery is in the business of throwing up roadblocks, nee the cape wind project. If we truly believe that we need to import significantly less foreign oil for our economic and security well being, we need to focus our solution on the highest pay-off with a sense of urgency. Today approximately 51% of our electrical generation is provided by coal fueled generation facilities and the renewables are providing less than 1%. On the other hand, almost all of our vehicles use gasoline. Transportation accounts for over 40% of our daily oil usage. Replacing transportation with natural gas has the highest payoff in the shortest time. Further, the infra structure installation time is much shorter and less costly. All this points to the natural gas solution.

H.R. 1835: Legislation for Natural Gas Transportation

Fitz, I am glad there are finally some members of Congress that realize that natural gas for vehicle fuel is an important part of the energy delivery system future for the US. I also applaud your persistance in getting the message out. I have to say that I told you so about Obama. His energy plan is employing a pea shooter to solve the alternate energy problem when the problem requires a 16 inch cannon. Further, he seems to prefer to cater to the single issue pressure groups, rather than solve the nation's problem. He rightly states that the nation has a structural problem that demands a large investment to solve. He then puts forth a goal of doubling the energy from alternative wind and solar in 3 years. This amounts to increasing that source from.9 of 1% to 1.8%, a trivial amount. His economic advisors don't seem to realize that the structural problem in the economy is ultimately related to the negative current account which has been increasingly negative since1991 and is approaching 1 trillion/yr. One can replace the current account verbage with operating negative cash flow. Although I like John Peterson's objective articles on energy storage, I disagree with the idea that we have multiple decades to solve the problem and as I keep repeating myself, a goal of 5 million barrels of imported oil reduction/day in five years and 10 million/day in 10 years needs to be set. Having articulated this goal, energy investment and near and long term new domestic source development would be focused and natural gas would be an obvious and leading solution.

Profiting from the Pickens Plan: FAN, Clean Fuels, Fuel Systems

These comments illustrate why we can't get an agreement on a comprehensive energy plan. Pickens is right about the economic problem.We can't have a negative 800B DOLLARS/yr cash flow as measured by the current account out of the country much longer and not have to sell our country. From a cash flow point of view it is still better for the US to produce a kilowat, or 'x' btu's at the same cost as we pay to produce it from imported oil. Moeover,any one solution will not get us there in time to avoid a financial disaster for a good share of our citizens. Wind and solar have a part to play. Copenhagen gets 20% of its electrical energy from 26 windmills in the approach to their port. Near term increases in our domestic oil and gas supplies is a necessity and so is a crash program to get wind power on line with accompanyind infrastructure where it makes the most contribution. By the way does GE have a significany role in wind power?