Tag Archives: clean energy

Time to seize a prosperous future fuelled by natural gas

Compared with coal, natural gas produces half the carbon dioxide, less than a third of the nitrogen oxide and just one per cent of the sulphur dioxide, with virtually no particulates. That China is looking to import LNG from B.C.’s shale gas is good news for both Canada and for the Earth’s atmosphere. But LNG will only slow China’s massive coal-fired power growth. Here’s the really good news. According to the U.S. Energy Information Administration (EIA), China possesses the world’s largest technically recoverable shale gas reserves that, at 1,115 trillion cubic feet, are almost twice as large as Canada’s. These vast resources remain undeveloped due to the early stage of Chinese recovery technology. That’s why the University of Calgary’s announcement of a new Canadian/Chinese Research Centre aimed at unlocking that potential is so newsworthy. At the signing ceremony in Beijing on October 23, U of C President Elizabeth Cannon stated that the project “will help China move from a coal economy over to gas.”

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Who killed the natural gas car?

GM EV1

From 1996 to 1999, General Motors invested and developed the EV1, the first mass-produced and purpose-designed electric vehicle by a major automaker.

The EV1 was inspired in part by the eventual California Air Resources Board (“CARB”) 1990 rule that each of the U.S.’s seven largest carmakers would be required to make 2% of its fleet emission-free by 1998, 5% by 2001, and 10% by 2003, in order to continue to sell cars in California. However, long story short, GM determined that the EV1 was not economically feasible.  Subsequently, GM and an alliance of automakers litigated the CARB zero emission regulation which resulting in a rewrite of the regulation that permitted the automakers to avoid zero-emission objectives and produce other low emission vehicles like natural gas vehicles (“NGV”), and hybrid cars. The EV1 program was scrapped along with most of the EV1 cars which were repossessed. The majority were crushed and a few were distributed to museums under the agreement they would never be driven.

The EV1 story inspired the 2006 documentary film “Who Killed the Electric Car?” which explores the development, limited commercialization, and scrapping of the Ev1 program. The film explores the various reasons why the program was scrapped, and looks at various parties that might have “killed” the program.

The bottom line – and hindsight – is that GM and other U.S. automakers failed to recognize the opportunity in front of them. They scrapped the EV1, missed the hybrid opportunity (which Toyota and others captured) and never really pushed a NGV. Instead GM started producing the Hummer for American consumers. And even now with the abundance of natural gas in North America, and increasing pressures to reduce carbon emissions, U.S. automakers are reluctant to support NGVs.

While many in and out of the natural gas industry are looking to natural gas as a viable “bridge fuel” that can provide lower carbon energy for electric power generation and transportation, the automakers are not biting. And despite natural gas vehicles being produced and marketed worldwide by all major manufacturers, U.S. manufacturers doubt a natural gas car is feasible in North America. Their primary reason is convenience. There are simply not enough natural gas filling stations to make NGV attractive to the average consumer. That may have been true once upon a time. Today compress natural gas (“CNG”) are more abundant and growing on at a steady pace with aggressive expansion by companies like Clean Energy which have a strong presence in densely populated states like California.

So why is it that U.S. automakers can produce and market a natural gas vehicle in internationally but not in the U.S. or Canada? North American auto makers do provide NGV for commercial fleet customers. Its an easier decision for many of these customers as they have central filling stations on their own sites. U.S. automakers continue to see NGVs a niche market in North America. In fact in last at the 2010 CERA Week Conference natural gas and its opportunity as a bridge fuel to reduce emissions and reduce dependence on foreign oil, automakers were noticeably quiet.

John Viera, Director of Sustainability & Environmental Policy at Ford Motor Company told the CERA Week conference; “We see natural gas vehicles remaining a niche market.” And that may be true unless consumers are prepared to be more active in their filling practices. Something that will be very difficult to change.

Jeffrey Jacobs, vice president of Chevron Technology Ventures, said natural gas-powered cars made sense in some regions. Mr. Jacobs is quoted: “Natural gas is not a good fit. We don’t see a significant penetration beyond that we have now.”

Auto-makers in North America focusing on squeezing more efficiency out of internal combustion engines, for example by reducing vehicle weigh, or moving toward zero- or near-zero emission electric or hydrogen cars.

So who killed the natural gas car? Well, its not dead. Its just being quietly used by commercial fleet owners that see the many advantages that natural gas offers in fuel efficiency, lower fuel costs and lower carbon emissions. And this market has the opportunity to expand usage with more commercial fleets, government (municipal, provincial, state) fleets, 18-wheelers, etc using more natural gas. If this happens, would fuel providers make natural gas more available in order to compete and service these customers? You bet. In time – and with more filling stations – perhaps the average consumer would recognize the improved convenience of natural gas. (Its also worth noting some of the advancements – mostly outside North America – being made with home filling stations. In Canada, natural gas runs to nearly every house and building in the country).

Cheverolet Astra

And the natural gas car is certainly not dead outside of North America. Those countries  that have implemented policies that have encourage alternative fuels have established robust distribution systems. A good example is Brazil, who recognized the energy value of their abundant sugar cane resources. Still in the works, Brazil now has a robust distribution network for alternative fuels – including natural gas. North America needs to recognize the value of abundant natural gas being unlocked from shale deposits and encourage this energy source to be used more. Brazil has ~1.6 million natural gas cars on the road compared to only 150,000 in the U.S. It is also worth noting that  GM do Brasil introduced the MultiPower engine in August 2004 which was capable of using CNG, alcohol and gasoline as fuel, and it was used in the Chevrolet Astra 2.0 model 2005, aimed at the taxi market.

Its not about convenience. Its about savings. Unfortunately, consumers usually don’t change their status quo until it becomes too expensive. When oil shot to $145 / barrel in 2008, SUV and other gas guzzling vehicle sales fell. There was a new surge in hybrid sales, and manufacturers started marketing fuel efficiencies. So it can happen. With increasing oil prices, and continued pressure to reduce carbon emissions, it is possible for a natural gas vehicle market to emerge in North America.

Obama announces shale gas initiative with China

Chinese President Hu Jintao (L) shakes hands with U.S. President Barack Obama (London April 1, 2009. Xinhua/Ju Peng)

President Obama and President Hu Jintao recently announced a broad agreement to strengthen cooperation between the United States and China on clean energy including a shale gas initiative that states:

Shale Gas Initiative. The two Presidents announced the launch of a new U.S.-China Shale Gas Resource Initiative.  Under the Initiative, the U.S. and China will use experience gained in the United States to assess China’s shale gas potential, promote environmentally-sustainable development of shale gas resources, conduct joint technical studies to accelerate development of shale gas resources in China, and promote shale gas investment in China through the U.S.-China Oil and Gas Industry Forum, study tours, and workshops.

New technology, and techniques in fracturing and horizontal drilling  have made it economically feasible to unlock natural gas from tight shale rock formations. In the U.S. natural gas reserves as increased by approximately 40%, and in Canada,  some  estimates have more then doubled natural gas reserves in Canada. The global impact of shale gas could have far reaching economic, and geopolitical implications.

In the U.S. law makers are currently considering the Natural Gas Act that will increase incentives to use natural gas more in the U.S. transportation network, and power generation. Natural gas is emits 50% less carbon then coal and approximately 30% less then diesel and gasoline. For the U.S., by using more natural gas they can reduce carbon emissions but also leverage domestic supply and supply from Canada thereby reducing their consumption of foreign oil from countries that do not share political interests with the U.S.

A breakthrough in Chinese domestic natural gas reserves could have profound impact on that countries growing need for energy, and displace some coal power generation. China needs all the technical and real world experience the world can offer, and Canadian companies should take initiative to develop this opportunity with China and other nations by co-development and technology sharing. On the government level, future trade missions should include a shale gas / clean energy component.

At the same time, as the U.S. increases domestic natural gas consumption and production, Canada needs to increase the use of natural gas in the Canadian transportation grid and power generation. Even with  an increased domestic consumption, Canada would have a surplus of natural gas available for international export via a planned LNG plant in Kitimat, British Columbia. Despite low natural gas prices, the opportunity in natural gas going forward is very bright and will help reduce carbon emissions as a bridge fuel towards a renewable clean energy future.

White House Press Release: U.S. – China Clean Energy Announcements

Look to natural gas as solution – by T. Boone Pickens

T. Boone Pickens appears as a guest commentator in the Denver Post where he presents his case for natural gas’ role in providing a practical solution to reduce carbon emissions and the US foreign dependence on oil. In building his case for the US to move towards leveraging the abundance of natural gas in North America, he raises some very important statistics that are worth reviewing;

  • Natural gas is the lowest cost carbon fossil fuel;
  • Natural gas emits nearly half the carbon of coal;
  • In June, the US imported 374 million barrels at a cost of $24.7 billion;
  • 70% of imported oil into the US is used for transportation (for gasoline and diesel) which powers our 250 million cars, light trucks and 6.5 million 18-wheeler;
  • Americans dump about 20 tons of carbon per person per year into the atmosphere;
  • There are about 10 million vehicles in the world operating on natural gas. Only about 146,000 of these are in the U.S. Natural gas is a proven, ready-to-roll technology; and,
  • Energy contained in US natural gas reserves exceeds the energy contained in all the oil in Saudi Arabia.

The momentum for natural gas is being put into practice by business decision makers across the US that recognize the natural gas advantage.

AT&T recently announced it would be buying more than 8,000 new vehicles that operate on natural gas. The single largest commercial fleet in the US.

The Ports of Los Angeles (see: Port of Los Angeles Launches 2009 Alternative Fuel Truck Incentive Program) and Long Beach are moving their trucks from diesel to natural gas to meet air quality standards.

Companion bills in the U.S. House and Senate provide tax incentives to jump start the use of natural gas as a major transportation fuel.

“No matter how you approach it, natural gas is crucial for America’s environmental, economic and national security future.” – T. Boone Pickens

Denver Post: “Look to natural gas as solution” by T. Boone Pickens

The Economist – The economics of natural gas

The Economist has published a thin article on the new view towards natural gas given the increase of reserves caused by new shale gas discoveries. The article is worth a quick read but essentially outlines many points HRN has made on the potential of natural gas to reduce carbon emissions immediately, and serve as a bridge to a cleaner energy future.

To summarize;

  • Natural gas is cleaner and burns ~50% less carbon compared to coal.
  • Electricity is the number one emitter of carbon in the US
  • Coal serves as the base source for electricity generation in the US
  • Use more natural gas for electricity production and less coal. Result less carbon emissions.
  • Use more natural gas in vehicles. Gasoline powered vehicles are also high carbon emitters. More natural gas, less carbon emissions.

Now here is something HRN has touched on, but not gone into detail. Some believe by promoting greater use of natural gas, it will hamper the use of other renewable resources like wind and solar. The fact is that the only thing that hampers or champions any source of energy is economics. The solution to cleaner energy has two parts 1) Technology and 2) Profit.

Another very important point made repeatedly here is that the solution will not (can not) be provided by one single source. There is simply no solution that will replace oil and coal entirely. Point being it will take all clean sources working together to reduce carbon emissions. Natural gas will work together with wind (see Pickens Plan), solar, geothermal and others in association with greater and more efficient uses of energy (conservation).

The Economist: The Economics of Natural Gas – Drowning in it

US Congress approves $150 million for natural gas vehicle research

natural-gas-vehicle

Natural gas vehicles are lacking in North America

The US Congress has overwhelming voted for a bill authorizing $150 million (USD) for the US Energy Department to conduct a 5-year research program on natural gas vehicles (“NGV”).  According to reports the program will be for “the continued improvement and development of new, cleaner, more efficient light-duty, medium-duty, and heavy-duty natural gas vehicle engines.” The first $30 million will be available in the 2010 budget.

The overwhelming support for the bill (393 For vs. 35 Against) is further evidence that the US Congress recognizes the benefits of natural gas and is moving towards increasing the use of natural gas to reduce dependence on foreign oil and  reduce carbon emissions. It is becoming increasingly obvious that the demand for natural gas will be going up in the US not only from an improving economy, but from its increasing share of the energy mix. And it should. It is abundant, clean and proven as a reliable source of energy in electricity generation and in motor vehicles.

Natural gas has been on quite a role in the last couple weeks. Earlier this month, the Natural Gas Act (“NatGas Act”) was introduced by Senate Majority Leader Harry Reid, and Sens. Orrin Hatch, and Robert Menendez along with the deep support of Texas billionaire T. Boone Pickens. (See HRN: “More tax incentives for natural gas vehicles in the United States” ) The NatGas Act would increase tax credits for buying a natural gas vehicle from $5,000 to $12,500; increase  grants to create additional natural gas filling stations and  natural gas engine development.

Shale gas discoveries in the Horn River basin of northern British Columbia and US have provided an amazing opportunity for North America to become more energy self sufficient, and reduce carbon emissions by using more natural gas in the transport network and electricity generation.

Picken’s Plan revised – Cheap, abundant natural gas impacts wind power plans

The abundance and affordability of natural gas was a contributing factor in T. Boone Pickens’ decision today to pull the plug on a his plans to build the world’s largest wind farm in Pampa, Texas.  The other contributing factors were financing and transmission. Transmission lines were key to carrying the power from the wind farm to the grid, and Mr. Pickens initially planned to finance the construction of his own transmission lines but has been unable to secure financing.

Though the Texas wind farm has been canceled the “Pickens Plan” seems to still be somewhat alive and Mr. Pickens intends to look to disperse the 687 wind turbines he ordered from General Electric. Mr. Pickens as stated he will look to participate in other turbine projects and place turbines in Pampa, Midwest US, and Canada.

So though cheap, abundant natural gas is bad for other clean energy alternatives, it highlights the major importance of natural gas being the primary resource for reducing North America’s carbon emissions.

Wallstreet Journal: Ill winds blow for clean energy