Shell’s foray into Alaska oil isn’t paying off

Shell started its hunt for oil off the coast of Alaska more than a year ago, but the effort proved disastrous. Shell spent $5 billion, but not a single well was drilled and its rig ran aground. Shell racked up big fines for faulty equipment, pollution and safety violations and sat out the last season. Reporter Elizabeth Arnold looked into the state of Arctic oil exploration in the U.S.

Out the window of a propeller plane, Wainwright appears below through the fog, an Inupiaq Eskimo village of wooden houses perched on a sand spit at the edge of the Arctic Ocean. I’m the only one on this flight, just me, the pilot and a dozen empty seats. We land on a short dirt runway. There’s no one around, so I head to town on foot.

Wainwright is the usual portrait of contrast in the Arctic, a polar bear hide stretched over a satellite dish, slabs of whale meat in the bed of a shiny new pick up.
 Old ways, and new money.

Wainwright is the closest village to Royal Dutch Shell’s most prized oil leases offshore. It’s where a subsea pipeline would surface to move oil 300 miles across the frozen tundra to Prudhoe Bay. A year ago, this place wasn’t so quiet. Flights were sold out and the man camp was full up. But other than a lone excavator shoring up the eroding beach, there’s no sign of any activity here today.

Inside the tribal office, Ronnie Morales makes coffee and shakes her head over how quickly everything came to a standstill.

“With their ability to just up and go, that just really made it real, you know that really happens,” she says.

Six years ago, at a standing-room-only auction in Anchorage, Shell spent $2 billion on leases in the Arctic, including a record-breaking amount for a single block just miles out from this village. But Shell had problems from the start.

Support vessels were deemed unsafe, a rig dragged anchor on its way north, and last year, when Shell was finally allowed to start limited drilling, an ice flow 30 miles long and 80 feet thick shut down operations after just one day.

The Coast Guard found multiple violations on one rig, and the other snapped its tow lines and ran aground.

A month later, Shell announced it wouldn’t try to drill in 2013. Interior Secretary Sally Jewell says the industry just wasn’t ready.

“Nobody wants to put their company at risk, their reputation at risk, or the environment at risk,” she says. “And I think that that’s what we saw in the lessons learned over the course of the last year.”

The Department of the Interior is now poised to issue new regulations for arctic drilling.

“This is not a place where you mess around,” says Marilyn Heiman, arctic program director for Pew Charitable Trusts, which made its own recommendations a few months ago.  “This is probably the most challenging place on the planet to drill for oil.”

Heiman would like to see a set of standards in place to regulate any company that wants to operate in the Arctic.

“Most of the regs that Interior uses to regulate are based on temperate water,” Heiman says. “During the Deepwater Horizon spill, when the waves got to six feet, they stopped cleaning up oil. When it was dark, they stopped cleaning up oil. Those are normal conditions in the Arctic!”

From the bow of this icebreaker, the Healy, conditions are extreme, even on a bright blue spring day. The Arctic Ocean is a flat plain of ice, ice so thick we have to back and ram every hundred feet to make headway. Building-sized slabs of ice fold and crash on both sides of the hull. The open black water behind us freezes in our wake.

The Healy is the Coast Guard’s only working icebreaker in the Arctic. The nearest base and major port are 1,000 miles away. That worries Rear Admiral Thomas Ostebo, the commander of the Coast Guard here. Vessel traffic, he says, is on the rise, and the U.S. has little control over much of it.

“As the North Slope of Alaska and the northwest portion of Alaska down to Nome, as that all opens up and becomes accessible, we just don’t know what we don’t know,” he says. “I do know wherever humans operate in the marine environment, sooner or later someone gets in trouble or there’s some form of a disaster.”

Despite the risk, and Shell’s seetbacks, Alaska’s former oil and gas division director, Ken Boyd, says the Arctic is in play.

“If you’re hunting elephants,” he says, “you have to go where the elephants are.”

In its conference call over third-quarter earnings, Shell broke its long silence over plans in the Arctic. CFO Simon Henry said the company will move forward on leases in the Chukchi Sea, which he described as a “multi-billion barrel opportunity.”

“Individually, it’s the largest single exploration prospect in the Shell group,”  he said during the call.

The company has submitted a stripped-down exploration plan to Interior to keep its options open to drill next summer.

In Wainwright, news that Shell may be back next summer was met with skepticism. But village leaders are planning ahead for the day when offshore oil does begin to flow. This winter they’re holding hazardous materials training sessions and drafting response plans in the event of a major oil spill, out on the ice, at sea.

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Bill McKibben’s lights-out plan for big oil & gas

Caroline Alden, BURN Contributor

Bill McKibben is a big name in the climate movement, and he’s got a game changing idea.

McKibben is the founder of 350.org, a grassroots organization aimed at stopping fossil fuel extraction (350 is the atmospheric concentration of CO2, in parts per million, above which leading scientists predict global warming may seriously threaten civilization).

 Since 2007, 350.org activists have been going big with their campaigns on behalf of the environment, from forming human chains around the White House, to promoting a global solar panel installation day (for the record, “PutSolarOnIt” predated “put a bird on it”).

Despite the aggressive work of 350 and other organizations, 230 billion more tons of CO2 have been dumped into the atmosphere over the last 6 years, putting us at  397 ppm today.

 McKibben recently teamed up with Naomi Klein to draft a new focus for 350: a campaign for divestment from the top 200 fossil fuel companies. So far, four colleges, one public university, one major city, and potentially one mega church have committed to freezing and ultimately withdrawing investments. The narrative driving this campaign is that investing in the fossil fuel industry promotes global warming.

 McKibben’s rhetoric – including a Rolling Stone piece he wrote last year – suggests he may be attempting to reframe global warming entirely, as a “good vs evil” fight against the fossil fuel industry.

 …[T]he planet does indeed have an enemy – one far more committed to action than governments or individuals. Given this hard math, we need to view the fossil-fuel industry in a new light. It has become a rogue industry, reckless like no other force on Earth. It is Public Enemy Number One to the survival of our planetary civilization. “Lots of companies do rotten things in the course of their business – pay terrible wages, make people work in sweatshops – and we pressure them to change those practices,” says veteran anti-corporate leader Naomi Klein, who is at work on a book about the climate crisis. “But these numbers make clear that with the fossil-fuel industry, wrecking the planet is their business model. It’s what they do.”

I got to hear the new McKibben pitch on his “Do The Math” tour in December. He painted a picture of a global society that wants electricity to come out of wall sockets, but doesn’t want to destroy the planet in the process. Standing in the way, to use McKibben’s rhetoric, are fossil fuel industry execs more interested in profit and far less concerned with the environment.

Also on tour were Ira Glass and Josh Fox (the banjo-wielding creator of Gasland), and an elaborate demonstration involving multiple cases of beer and Winona LaDuke drinking them: a witty metaphor for… wait… what was the point of that again? Largely, it seemed, to attract the college-aged demographic.

 But, back to McKibben. By his calculus, framing this global issue as an actionable fight against an antagonistic tyrant may mobilize people – especially young people, who will be most affected by climate change – to demand change from their universities, colleges, churches, and local governments.

 The question of whether the divestment campaign will succeed as a purely economic tool might be secondary to McKibben’s ability to rouse a new generation to take positions – and take action – in the climate debate.

In an interview with Gothamist last summer, McKibben frequently cited the economic success of divestment in ending South Africa’s system of Apartheid. That point is spelled out at gofossilfree.org – a base for McKibben’s investment freeze campaign.

There have been a handful of successful divestment campaigns in recent history, including Darfur, Tobacco and others, but the largest and most impactful one came to a head around the issue of South African Apartheid. By the mid-1980s, 155 campuses — including some of the most famous in the country — had divested from companies doing business in South Africa. 26 state governments, 22 counties, and 90 cities, including some of the nation’s biggest, took their money from multinationals that did business in the country. The South African divestment campaign helped break the back of the Apartheid government, and usher in an era of democracy and equality.

Economists point out that it wasn’t the direct economic instrument of divestment that ended Apartheid, but the combined social and economic pressures that mounted and prevailed, as the global community identified and rejected a moral wrong.

If the rabble gets roused, then we may find that McKibben is indeed onto something.

Caroline Alden is a graduate student at the Institute of Arctic and Alpine Research in the Department of Geology at the University of Colorado at Boulder.

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How oil is made

Christopher Johnson, BURN Digital Producer

Americans use a LOT of oil. About 20 million barrels a day. Much of that oil – before it’s turned into products we use in our cars, our homes, and our plastic water bottles – exists in 2 basic forms: light (sweet) crude, and heavy crude.

heavy vs light crude

Heavy (left) vs light crude oil.

Light crude is the most desirable because it’s low in sulfur – an element that must be processed out of oil. That means companies have to spend less time and energy turning light crude into useful products.

That low sulfur content is also why it’s sometimes called “sweet.” Early prospectors used to taste the oil, to know what they had on their hands.

Light crude is found largely in the US Gulf states and Nigeria. Canada also has large sweet crude deposits.

In Saudi Arabia, Mexico, Venezuela, and Iraq, heavy crude is most common. “Heavy” because it has a lot of impurities – including wax – that have to be removed through costly processing.

SWEET & SOUR PROCESSING

Liquid petroleum pumped up out of the ground needs refining. Once the sulfur and other impurities are removed, it goes through a distillation process that Michael Poehl – who teaches about oil refining at The University of Texas at Austin – says isn’t unlike making your own liquor.

Knowing what you’ve got on the other side of the refining process takes some chemistry. Here are a few basics.

hydrocarbon chains

Hydrocarbon chains of varying lengths lead to different petroleum products. (chemistryland.com)

Petroleum is made up of compounds that include hydrogen atoms and carbon atoms. They bind to form hydrocarbon molecules.

Each of those hydrocarbons is like a chain link. When just a few hydrocarbons are linked together, you get a very light petroleum product – like methane and propane gases. Several dozen hydrocarbon links locked together means heavier stuff – lubricating or heavy fuel oil.

So, a company pours a drum of crude oil into a refinery. The refining process breaks up the oil’s hydrocarbon chains into various lengths, so that out comes a bunch of different products.

The most valuable is gasoline. About 40% of the crude that goes into a refinery comes out as gasoline.

Refinery components

Components and outputs of a typical refinery.

There are different kinds of refineries. Those built mainly to process light crude are focused on creating gasoline. Heavy crude refineries are designed to first get the impurities out, and then process the oil. Poehl says that the key to refinery economics is to optimize whichever crude strain is being processed. That means finding the cheapest, fastest, most efficient ways to get as much product as possible out of the crude that goes in.

TAR SANDS

Another oil source is tar sands – loose sand or sandstone saturated by a kind of thick, goopy petroleum called bitumen. Tar sands are especially plentiful in Northwestern Canada.

Tar sand hands

They are tough to work with because the petroleum is so heavy. In these deposits, the natural oil/sand mixture has to be heated in order to extract the petroleum. Refiners may have to process a ton of sand to get a barrel of oil, Poehl explains. Still, a lot of oil people are betting on tar.

One major tar sands project is the proposed 1,700- mile Keystone XL Pipeline, which would run from western Canada through the central United States and down to the Gulf of Mexico.

Keystone_Pipeline_System

The plan has sparked a lot of debate, and opposition from farmers and environmental groups that say the tar sands are especially corrosive and thick, and therefore prone to leaking from the pipeline and onto farm land.

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What goes down: Stein’s Law and the cost of energy

Carey King, BURN Contributor

Stein’s Law states: “If something cannot go on forever, it will stop.”

For nearly 60 years after World War II, the percent of U.S. household income spent on food and energy – or personal consumption expenditures (PCE) – declined.

But then things started to change. Again. Between 1998 and 2002, PCE for food and energy stopped declining and started increasing. The PCE for “food + energy” reached a minimum of 18% in 2002. Whether or not this will be the minimum percentage PCE for “food + energy” for the US for all time is a good question.

But this percentage cannot decrease forever because energy and food will never be free – back to Stein’s Law. As we’ll see shortly, the reversal of these trends could be an indicator of a fundamental transformation for our economy and society.

Carey King - Food_Energy chart

Figure 1. Personal consumption expenditures of US households expressed as a percentage of total expenditures. Data are from the US Bureau of Economic Analysis Table 2.3.5. Food = “Food and beverages purchased for off-premises consumption” and “Food services and accommodations.” Energy = “gasoline and other energy goods and of electricity and gas.”

The reason to consider both the PCE for energy and food is because food was fundamentally an energy source of pre-industrial power from humans and animals. Before fossil fuels and significant industrialization using wind, wood, and water power in the early 1800s, food was the major energy resource for prime movers.

The food that animals and people ate was the fuel that powered them, and therefore the machines and tools they operated. Thus, the quantity of food and fodder produced from the land had a major influence on the amount of power for agriculture and a little industry.

In a large sense, fossil fuels and subsequent technologies drove down the relative cost of food and energy. Those energy-dense resources enabled the technical change that generated economic growth. Fossil fuels also meant fewer and fewer workers were needed to grow food and mine energy sources.

Since 2002, we have been spending an increasingly higher proportion of our personal income on food and energy, due to resource scarcity. Thus, there has been an increased demand for more investment (capital and labor) in these basic needs.

In other words, food and energy have become increasingly scarce – and therefore, more expensive – because of the rising demands for each around the world.

As a result, an increasing proportion of workers and other resources may be needed to produce the same quantity of food and energy (fossil and renewable), possibly with declining per capita consumption. This is the exact opposite trend of fossil-fueled industrialization!

The truth is that constraints in food and energy supplies, together with consumption patterns (and demographics, too, but that’s another subject) have caught up with much of the ‘advanced’ economies (e.g. EU, US, Japan). Unconventional oil alternatives – oil sands, deepwater, oil shale, biofuels – don’t have the same level of pure energetic value as energy sources of the past.

In considering the ongoing debate about American jobs and decreasing unemployment rates, note how the oil and gas commercials tout the jobs they create. Then, remember the figure in this article. Historically, the economy has grown the most when we’re moving jobs out of the energy sectors.

The rising cost of energy is a primary cause of our slow economy, and there is a limited rate at which we can adjust to this new reality. The sooner citizens, businesses, and politicians accept this fact, the better we will be in the future.

Carey King is a research associate in the University of Texas at Austin’s Center for International Energy and Environmental Policy. King researches energy systems and how they work together and within the environment. King contributes blog posts for Environmental Research Web, under Energy – The Nexus of Everything.

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Tar sands in the US? It’s not just about the Keystone Pipeline

Alex Chadwick, BURN Host

This just in: the Obama Administration continues trying to walk the very fine line that will least anger his many critics in the energy industry and among environmental groups.

 The latest is an announcement last week from the outgoing Secretary of Interior, Ken Salazar. It’s about development of potentially huge hydrocarbon reserves in Colorado, Wyoming and Utah.

The DOI agency that manages federal lands – aptly named the Bureau of Land Management (BLM) – has formulated new rules about how to exploit these reserves in a way that it says is environmentally sound, and a good financial deal for the feds and, ultimately, taxpayers.

From comments by Mr. Salazar: “This plan maintains a strong focus on research and development to promote new technologies that may eventually lead to safe and responsible commercial development of these domestic energy resources. It will help ensure that we acquire critically important information about these technologies and their potential effects on the landscape, especially our scarce water resources in the West.” 

But it’s a good bet that no one will be happy with this. There are oil shale and tar sands operations already set to get underway this summer in Utah – operating on state and private lands, and thus not subject to BLM rules. The tar sands operation would be the first of its kind in this country. The oil shale facility would be the first US site for that development in thirty years.

Both hydrocarbons are solids in their natural state, and must be treated, and often heated, to be transformed into petroleum. The estimated recoverable reserves of these hydrocarbons are enormous – perhaps three times the size of the oil holdings in Saudi Arabia. The world’s easy-to-get petroleum reserves are dwindling, but the industry sees huge potential payoffs in these ‘unconventional’ fuels.

And the Greens see a disaster. The climate numbers keep getting worse. Much worse. More hydrocarbons = more devastation for our children and grandchildren, the Greens say. We have to leave some hydrocarbons in the ground, and these are the ones to start with. It takes more energy to make them usable, which means their carbon consequences are even greater than normal petroleum.

Oh, by the way: jobs, jobs, jobs, jobs, jobs, jobs. And jobs.

This new BLM proposed rule is now open for 60 days of comment. It’s just another small tick for the time bomb of energy and climate. And why now? An act of grace by Mr. Salazar. His replacement, the new Secretary of Interior, Sally Jewell, CEO of Recreational Equipment, Inc., is about to get a confirmation vote by the full US Senate. She’ll be glad this isn’t waiting for her. But those 60 days will pass soon enough.

The ticking doesn’t ever stop. There’s a tremendous political fight in this country right now about the Keystone XL Pipeline meant to carry Canadian tar sands to US Gulf Coast refineries. As US land continues to be developed for tar sand exploitation, the fight won’t just be about resources coming in from Canada. The battle will be here, too.
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The Hydrogen Economy, Hydrogen Sources, and the Science Behind These

The hydrogen-filled Hindenburg in 1936 or 1937. Photo from DeGolyer Library at Southern Methodist University.

THE HYDROGEN ECONOMY

The hydrogen economy is a hypothetical future in which energy can be bought, sold, stored, and transported in a currency of hydrogen, much like today’s energy is often exchanged in electricity. Because hydrogen doesn’t need to be attached to the electricity grid, it can be used in forms of transportation like buses and cars.

The end-user of the hydrogen, for example an automobile driver, doesn’t experience significant pollution beyond the formation of water from burning the hydrogen.

For more details about the hydrogen economy see here.

Hydrogen, a gas, isn’t a fuel like gasoline or coal; hydrogen is a way to store and transport energy made from other fuels, like a battery or electricity. Unlike fossil fuels, pure hydrogen isn’t stable, so forming hydrogen in the first place requires energy and produces carbon dioxide, and storing hydrogen involves special considerations because this light gas is very flammable and also quickens rust and oxidation in pipelines and storage containers.

HOW HYDROGEN IS DIFFERENT FROM FOSSIL FUELS

Allowing hydrogen (a gas) to burn in the presence of oxygen releases that stored energy in the form of heat. Hydrogen can also be reacted in a fuel cell to produce electricity. In either case, electricity or heat can then be used to power cars or any number of other devices. Gasoline, biofuels, wood, and other carbon-based fuels all produce carbon dioxide when they are burned, and rising carbon dioxide levels are widely implicated in climate change. Burning hydrogen produces energy, water and a few trace compounds, but it doesn’t produce carbon dioxide.

2 H2 (hydrogen gas) + O2 (oxygen gas) = 2 H2O (water vapor) + energy

It’s unclear what widespread emission of water vapor could do. According to recent published estimates, atmospheric water vapor is responsible for 75 percent of the greenhouse effect. However, water vapor can condense, and it’s naturally-occurring in the atmosphere. It is much easier to trap and transform to liquid than the carbon dioxide normally emitted by burning gasoline. Carbon dioxide won’t form a liquid at atmospheric temperatures and will solidify into dry ice only below -108.4 Fahrenheit, so proponents say it can be easier to trap the vapor in hydrogen-powered machines.

If the energy used to generate and purify and store and ship hydrogen doesn’t require emitting greenhouse gases or toxics, proponents argue that hydrogen is a clean alternative.

SOURCES OF HYDROGEN: THE UNFORTUNATE REALITY TODAY

Hydrogen, not carbon, is the most prevalent atom in the human body. There are two hydrogen atoms in every water molecule, and as many as hundreds of hydrogen atoms on the basic building blocks of life, from DNA to plant fibers. Nonetheless, harvesting the hydrogen atoms out of any of these structures to make hydrogen fuel isn’t easy because hydrogen likes to be bonded to carbon or oxygen; it doesn’t like to be elemental gas.

To produce pure hydrogen today, industries use primary fuel source like petroleum, natural gas, coal, or biomass. Through chemical processing, the hydrogen atoms are stripped from the fuel by way of an input of energy from electricity (more than 80 percent of which comes from fossil fuels in the United States). Furthermore, the leftover material from the stripping is carbon dioxide, the same carbon dioxide that would have been produced if the fuel was burned in an engine.

The reactions for various fuel to hydrogen conversions can be found on the U.S. Department of Energy website here.

Hydrogen can also be produced, at great energy loss, through the electrolysis of water: using electricity, water is divided into its constituents, hydrogen and oxygen. However, water electrolysis is the least carbon-neutral hydrogen production method, and it is very expensive ($3 to $6 per kilogram instead of a little more than $1 in the case of using coal for hydrogen), according to the U.S. Energy Information Administration. All hydrogen production methods result in a net energy loss.

 

 

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The Global Energy Mix and Policies

 On this page, you can find energy information about the world’s most populated countries: China, India, the United States, Indonesia, Brazil, Pakistan, Bangladesh, Nigeria, Russia, and Japan. For fossil fuel information about any country, see online tables here.

A nation’s sources of energy hinge on so many factors, from what’s naturally available to geography, political history, and relative wealth.

Even though energy demand is increasing rapidly across the globe, the International Energy Agency estimates a fifth of the world population lacks access to electricity, and a whopping 40 percent of people still use traditional biomass – like wood chips – for cooking. People who live without the energy infrastructure of electricity depend on portable petroleum fuels, manure and methane gas produced from manure, wood, grass, and agricultural wastes. Because these sources of energy are informal, it’s difficult to track and include them in statistics.

World electricity and energy demands are escalating. Countries are expanding energy investment to non-fossil sources like biofuels, wind, solar, and geothermal. At the same time, they are competing to secure access to coal, natural gas, and petroleum both at home and abroad.

 

Nowhere has rapid energy growth been more conspicuous than in the world’s most populated country, China. While most countries saw moderate energy growth in the same period, this Asian nation doubled energy use in less than a decade – see graph – and surpassed the United States in total energy use in 2009, according to International Energy Agency estimates. Until 2009, the United States lead the world in total energy consumption, though not per person consumption, for decades. For a list of the top 30 countries by total energy consumption see here.

Meanwhile, less than 42 percent of people in Africa had electricity at home in 2009. South Asians seemed better off than Africans that year, at 62 percent, but the real story is much more diverse. Nearly 100 percent of Chinese had access to electricity, while in Burma, only 13 percent had access. Worldwide almost 78 percent of people had access to electricity in 2009, according to the International Energy Agency.

 

ENERGY IN THE WORLD’S MOST POPULATED COUNTRIES

 

CHINA (Pop. 1.3 billion)

Between 2008 and 2035, China may triple its electricity demand, adding power plant capacity equal to the current U.S. total, the International Energy Agency projects in one scenario of the 2010 World Energy Outlook.

China is the world’s most populated country and also the world’s largest energy consumer. China gets most of its energy from coal, 71 percent in 2008. China is also the world’s biggest coal producer but only third, behind the United States and Russia, in coal reserves.

In 2008, China generated another 19 percent of its energy from oil, which it imported from all over the world, more than half came collectively from Saudi Arabia, Angola, Iran, Oman, Russia, and Sudan. China used to export its oil, but by 2009 automobile investment was expanded by so much, the country became the second largest oil importer (United States is first).

China is in hot pursuit of securing as much oil as possible, as the nation’s reliance on imported oil is growing far more rapidly than its oil production. Several powerful, national oil companies provide the domestic oil, both from on and off-shore sources. Furthermore, China has purchased oil assets in the Middle East, Canada, and Latin America, and it also conducts oil-for-loan exchanges with other countries, $90 billion worth since 2009, according to the U.S. Energy Information Administration.

Only a small proportion of China’s energy comes natural gas, produced domestically and imported in liquified form, but that may change as prices lower and liquified natural gas terminals are constructed.

China is the world’s biggest user of hydroelectric power, which made up 6 percent of energy and 16 percent of electricity in 2009. The country’s Three Gorges Dam, the world’s largest hydroelectric project, is expected to begin operating in 2012. Nuclear power accounts for only 1 percent of total consumption. However, China’s government predicts it will have seven times its current nuclear capacity by 2020.

A homemade oven. West Bengal, India, 2009.

Detailed data on energy in China can be found here.

 

 

 

 

 

 

INDIA (1.2 billion)

India is the world’s largest democracy. Though India’s population is close to that of China’s, it is only the world’s fifth largest energy user, behind the United States, China, Russia, and Japan.

Like China, India’s electricity comes mostly from coal. However, India doesn’t have enough electricity for everyone, and only 65 percent of the population has access to electricity.

Instead, many Indian use fuels at home for lighting and cooking. A 2004-2005 survey by the government found more than 40 percent of rural Indians used kerosene instead of electricity for home lighting. The same survey showed that for cooking, 74 percent of Indians used firewood and wood chips, 8.6 percent used liquified petroleum gas, 9 percent used dung cakes, and 1.3 percent used kerosene.

India produces oil domestically, but like China, the rate of India’s increasing oil consumption far outstrips its production. India therefore has to import oil; in 2009 its most significant sources were Saudi Arabia, Iran, Kuwait, Iraq, the United Arab Emirates, Nigeria, Angola, and Venezuela, in descending order.

India doesn’t have the electricity capacity to serve its population but aims to add many thousands of megawatts in the near future.

Like China, India has nuclear power, with 14 nuclear plants in operation and another 10 in planning, the reactors purchased from France and Russia.

 

UNITED STATES (300 million)

Until China recently outpaced it, the United States was the biggest energy consumer in the world, though per capita use isn’t the highest but in the same range as several developed countries worldwide and less than the per capita use in Canada. The United States relies on petroleum, coal, and natural gas, as well as a small part nuclear, hydroelectric, and various non-fossil sources. The Unites States has significant oil, coal, and natural gas reserves, as well as the potential for significant investment in solar, off and on-shore wind, and biofuels.

The mix of fuels that provide electricity varies widely from region to region. Find a map of fuel mix by U.S. region from the Edison Electric Insitute here.

For more U.S. information:

-Fossil fuel use in the United States, go here.
-U.S. greenhouse gas emissions and energy here.
-U.S. sources of energy, see here.

 

INDONESIA (250 million)

Indonesia is an archipelago of more than 17,000 islands — 6,000 are inhabited — and it is home to 76 active volcanoes and a significant undeveloped geothermal capacity, estimated at 28 gigawatts, about as much total electricity capacity as Indonesia had in 2008.

Indonesia’s energy demand is growing rapidly, split between coal, natural gas, and petroleum sources. Traditional sources of energy like wood and agricultural waste continue to be used, particularly in rural areas and remote islands, and the International Energy Administration estimates these fuels provide about a quarter of the country’s energy.

Indonesia exports coal and natural gas. In the past, the country also exported more oil than it used, but as of 2004 that balance changed. By 2009, the country suspended its membership in the Organization of Petroleum Exporting Countries (OPEC) because it was using so much of its own oil.

 

BRAZIL (200 million)

Tropical Brazil is the largest country in South America both in area and population, and it is the third largest user of energy in the Americas, after the United States and Canada.

Made from sugar cane, Brazil’s ethanol production is the world’s second largest, after the United States, which makes ethanol from corn.

Brazil produces almost as much petroleum as Venezuela and produces slightly more fuel than it consumes.

While Brazil depends on oil for other energy applications like transportation, the country gets an astounding 84 percent of electricity from hydroelectric dams. Brazil also has two nuclear power plants.

PAKISTAN (190 million)

Pakistan has limited access to electricity and energy sources, and its rural population still relies on gathered fuels like wood for heating and cooking.

In 2009 around 60 percent of the population had access to electricity, far better than its neighbor Afghanistan, at just 15 percent. Nonetheless, even with access, most of the population can’t rely on electricity unless they are wealthy enough to own generators. Pakistan suffers from lengthy blackouts, even in its cities, in part because of poor transmission infrastructure and widespread electricity theft. The situation is also aggravated by lack of capacity planning, insufficient fuel, and irregularities in water supply for hydroelectric.

In 2010, angry citizens protested violently after lengthy blackouts — as long as 18 hours according to Reuters — plagued the country. That summer, Pakistan has nowhere near enough electricity for its peak needs, which were roughly 25 percent more than its total production capacity. The widespread blackouts crippled the country’s textile industry, its biggest source of exports, and some reports suggest that hundreds of factories were shuttered as a result of sporadic power.

Meanwhile, several proposals for gas pipelines through Pakistan have yet to get solidified, including one from Iran to Afghanistan (which is opposed by the United States).

 

BANGLADESH (160 million)

Like nearby Pakistan and India, with which it shares cultural and political histories, Bangladesh also suffers from electricity shortages. Only 41 percent of Bangladeshis had access to electricity in 2009, according to the International Energy Administration.

Most of the electricity in this delta nation is generated from natural gas, with smaller amounts each from oil, coal, and hydroelectric sources. More than 30 percent of the country’s energy comes from biomass, agricultural wastes, and other combustible, renewable materials.

In 2011, Bangladesh signed a contract with oil company ConocoPhillips, allowing off-shore drilling for natural gas, despite internal protests that insisted Bangladesh should keep more of the gas for its own. The agreement gives 20 percent to Bangladesh.

 

NIGERIA (160 million)

Nigeria is Africa’s most populous country, and it is world famous for its oil, most of which is exported for sale by huge foreign oil companies like Royal Dutch Shell, ExxonMobil, Chevron, ConocoPhillips, Petrobras, and Statoil. Roughly 65 percent of government revenue comes from the oil sector, and around 40 percent its oil exports are sent to the United States. Nigeria also holds the largest natural gas reserves in Africa.

Extensive oil development has wreaked havoc on Nigeria’s ecology. Oil spills have polluted Nigeria’s water, affecting both fishing and agriculture. Much of Nigeria’s natural gas is flared rather than being collected and sold for fuel. Flaring involves burning off naturally-occurring gases during petroleum drilling and refining, resulting in  environmental degradation, greenhouse gas emissions and loss of revenue.

Even though Nigeria is fossil fuel-rich, only 47 percent of the population have access to electricity, and less than a fifth of energy in that country came from petroleum and natural gas in 2007, reflecting the widespread use of more traditional fuels like wood. Nigeria only used 13 percent of petroleum it produced in 2009.

 

RUSSIA (140 million)

Russia has significant wealth in fossil fuels, including the largest natural gas reserves and the second largest coal reserves, after the United States. In 2009, Russia produced more oil even than Saudi Arabia, mostly from Western Siberia. In 2009, Russia exported far more oil than it used, and 81 percent of its exports went to Europe, notably the Netherlands and Germany.

Russia is also the third largest consumer of energy in the world.

The country has a well-developed pipeline system to transport oil from remote regions, a system which is almost entirely controlled by a single state-run company, Transneft.

Like Nigeria, Russia flares gas in the process of drilling and refining oil, and in 2008 Russia flared more gas than any other country in the world, 1,432 Bcf of natural gas, more than double Nigeria’s output and equivalent to the annual greenhouse gas emissions for 1.4 million passenger cars, according the calculator on the U.S. Environmental Protection Agency website and data from the U.S. Energy Information Administration.

Russia operates 31 nuclear reactors, half of which employ a similar design to the ill-fated Chernobyl plant in the Ukraine.

 

JAPAN (130 million)

Japan doesn’t have significant fossil fuel resources, one reason that much of its electricity industry relies on nuclear power. It is the world’s third largest user of nuclear power.

Japan is the world’s third larger oil consumer, and it does produce some oil domestically. However, it also imports a lot of oil and natural gas, the later in the form of liquified natural gas, or LNG. Almost half of its energy came from imported oil in 2009, and just 16 percent of Japanese energy came from a domestic source.

Japan also invests heavily in foreign oil, including in the United Arab Emirates, the Congo, Algeria, Russia, Australia, Papua New Guinea, Brazil, Canada, the United Kingdom, Vietnam, and Indonesia, to name a few.

As of June 2011, Japan is still recovering from a massive earthquake and tsunami that devastated its northeast coast on March 11, 2011, forcing the shutdown of several nuclear reactors as well as damaging refineries, oil and gas generators, and electricity transmission infrastructure.

Japan imports most of its oil from the Middle East: Saudi Arabia, Iran, Kuwait, the United Arab Emirates, and Qatar together supplied 77 percent of imports in 2009.

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Major sources of energy/their advantages and disadvantages

There is no easy answer to what is the best source of energy or electricity. Is the priority reliability, affordability, the economy, international human rights, limiting greenhouse gas emissions, preserving environmental resources, or human health?

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It’s undeniable that today — whether we like it or not — humans worldwide are overwhelmingly dependent on fossil fuels: coal, oil, and natural gas. Everything eaten, worn, lived in, and bought is tied to availability of fossil fuels. Even if 100 percent of politicians were determined to stop using them today, society has neither the electricity grid nor the vehicular and industrial technology to sustain the current American lifestyle on non-fossil sources of energy. Yet.

When comparing sources of energy, it’s easy to forget how universal fossil fuels are. These sources continue to dominate for reasons that are difficult to measure, like political influence, advertising clout, and control over energy infrastructure. Other sources have disadvantages purely because they don’t fit in as well.

Volume brings another difficulty in comparing sources of energy. There is so much more fossil energy, and it’s been used for a long time, so we know a lot more about its hazards and benefits. More modern technologies are harder to quantify. Some are renewable but still pollute (biofuels), some are very clean except in accidents or waste disposal (nuclear). Most electricity sources (renewable or not) use steam turbines, and all the water to make steam has to come from somewhere, but how important should that factor be?



Clicking the graphic above will give an abbreviated chart comparing sources line by line, but that doesn’t provide anywhere close to the whole story.

Each of the following topics compares the major sources of energy  through a different lens. Though environmental and local issues may seem the most important to those of us who don’t own power plants or utility companies, the cost of energy drives which sources are actually in place today and which sources will see investment tomorrow.

 

 

 

 

 

 

 

 

 

 

 


Source: U.S. Energy Information Administration

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The Price of Gasoline: How it Rises and Falls

Menlo Park, CA, April 2011

WHY GAS PRICES CHANGE

The price of gasoline fluctuates with several markets, not only the retail market of service stations. In fact, when looking at the national average gasoline at the pump, the international crude oil market is the single biggest factor determining the price.

 

 

 

THE INTERNATIONAL OIL MARKET IS VOLATILE

International crude oil prices can change according to what OPEC, the Organization of the Petroleum Exporting Countries, decides to do, because they own most of the world’s proven oil reserves and produced about 40 percent of the world’s oil supply in 2010. OPEC is the largest entity involved in crude oil production, and it holds prices at a particular level by slowing production and withholding supply.

In general, when economic growth slows globally, demand for crude slows and the price of oil drops, which is reflected back at the pump.

Oil prices can also fluctuate because of oil traders, those who buy and sell crude oil before it’s refined into fuels and other products. Traders are very sensitive to  political instabilities – well before there are actual restrictions on oil supply – such as occurred during the Egyptian revolution of 2011, when oil prices increased as oil traders worried about crude traveling through the Suez Canal, even though only 2 percent of the world supply ships through that waterway, which is controlled by Egypt.

The events and conditions that convince oil traders to buy and sell are sophisticated and carefully tracked by authorities here and internationally because oil is so critical to the global economy. However, even though many monitor oil prices carefully, the market can be manipulated.  For example, in May 2011, the United States government alleged that Australian and American oil traders fraudulently restricted supply  to hike up crude prices. U.S. Suit Sees Manipulation of Oil Trades.

 

 

Note: the Transportation and Marketing costs in the above chart were calculated by the Energy Information Administration as the remaining difference between the average retail cost and the other three components.

 

WHY PRICES ALSO VARY STATE-TO-STATE AND CITY-TO-CITY

Regionally, the price of gasoline can change because of local competition, rents, local laws, and temporary shortages, particularly if there’s a limited amount of refined oil. Some states are just plain closer to the refineries, and some states have emissions-related requirements for gas that limit the source of gas to certain refineries.

Californians pay some of the highest gas prices, not because their state tax rates, but because of stringent requirements on the blend of gasoline allowed to be sold. That means there are few refineries outside of California that can supply gas to the state. The elevated price is both due to limited supply from refineries and a higher refining cost.

In other states, the distance to refineries can add cost too. Hawaii is far away from almost everywhere, and it probably comes as no surprise that gasoline prices in that island state are high. Average prices by state are compiled here.

Geography and laws about what can go in the gas sold in a state contribute a lot to the price of a gallon of gasoline, perhaps significantly more than the factor that’s often blamed for wide-ranging prices, taxes.

 

TAXES

Compared to Europe, Americans pay far lower taxes on gasoline, in the range of 15 percent (see chart above) as compared to more than 50 percent for some countries. For a chart of how much tax various countries pay, go here.

The federal government applies a per gallon tax on gasoline and diesel in every state.Then, individual states and even counties add their own taxes, which can be both sales and fuel taxes. For historical and current gasoline taxes by state, you can visit the Federal Highway Administration website here. Fuel taxes are applied by the gallon. Sales tax is applied to the overall cost of the gas, by percent.

The most expensive states to buy regular gasoline in 2009 were, on average, Alaska, Hawaii, and California. The cheapest states were Kansas, Arkansas, and Tennessee, even though Arkansas, Kansas, and Tennessee all charge higher per gallon fuel taxes than California.

Californians also paid the same rate of sales tax, 6 percent, as many other states in 2010, like Michigan, Maine, Tennessee, and Minnesota. However, since their base price of gas is higher, the percent sales tax was higher too.

For recent gas prices by region, go here.

Other costs that affect the price of gas include distribution (shipping and trucking crude oil to refineries and then to consumers) and refining (turning crude oil into gasoline, a mixture of carbon-based liquids). For more information about our dependence on crude oil, see here.

 

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The Connections Between Greenhouse Gas Emissions and Energy

Most of the greenhouse gas emitted through human activity comes from the production of energy.

This group of gases is thought to contribute to global climate change, long-term shifts in weather partly due to the tendency of these gases to trap energy, in the form of electromagnetic radiation from the sun, that would otherwise have been reflected back out into space. For more about the relationship between the climate and greenhouse gases, go here.

Noteworthy greenhouse gases  are carbon dioxide, nitrous oxide, methane, hydrofluorocarbons (HFCs), perfluorocarbons (PFCs), and sulfur hexafluoride (SF6).

Energy creation results in such a high level of greenhouse gas because the vast majority of energy we use — regardless of what country we live in — comes from burning something, usually coal, petroleum fuels, natural gas, or wood. More than 80 percent of U.S. energy in 2009 came from the combustion of fossil fuels.  Go here for more information about how combustion works.

WE’VE BURNED THINGS FOR EONS, WHY IS IT DIFFERENT NOW?

Plants and some types of microscopic organisms take carbon dioxide gas out of the air and turn it back into solid, carbon-based materials like plant fibers, using the energy of sunlight. The basis for all of our fuels, even the fossil fuels, comes from exploiting the fact that organisms convert  light energy into chemical energy, a potential energy source inside the plant or organism’s cells, whether the energy was converted in the last few decades (wood, biodiesel, ethanol) or millions of years ago (fossil fuels). Today, however, organisms don’t have the capacity to capture anywhere near as much of the greenhouse gas carbon dioxide as we produce, partly because we are burning fuels produced over millions of years.

EMISSIONS ARE A WORLDWIDE PHENOMENON

The United States produces more greenhouse gas each year per person than most other countries. However, even if we stopped producing any carbon dioxide at all, which is unlikely, the world would still keep producing 80 percent of its former output. Other regions produce just as much as we do, particularly Europe and China.

Furthermore, instead of holding steady at a particular emission rate, every year we use more energy and therefore emit more greenhouse gas. For a graph of atmospheric carbon dioxide by year, go here.

When we talk about energy-related emissions, we don’t only mean electricity. Energy involves burning oil and natural gas for heating, burning gasoline, diesel, and jet fuels for transportation. Transportation accounted for just over a third of all carbon dioxide emissions in 2009, electricity was almost 40 percent and residential, commercial, and industrial production, excluding electricity, made up roughly 26 percent.

Some greenhouse gases are thought to alter the climate more than others. Nitrous oxide is a much smaller percent of the gas mix than carbon dioxide, but for its weight it has a much stronger heat-trapping capability.

For more information go to The connection between greenhouse gases, climate change, and global warming.

Each year what proportion of emissions are man-made are carefully tracked by several agencies nationally and internationally, including the National Oceanic and Atmospheric Administration, the National Weather Service, and the National Aeronautics and Space Administration.

Sources:

U.S. Geological Survey
U.S. Energy Information Administration

U.S. Environmental Protection Agency
U.S. National Oceanic and Atmospheric Administration
CIA World Fact Book
World Energy Council
National Renewable Energy Laboratory
Emissions of Greenhouse Gases in the United States 2009: Independent Statistics & Analysis. U.S. Energy Information Administration, Department of Energy. March 2011.

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