J.C. Moore Online
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Posts Tagged ‘coal industry’

Who Wants to Kill the Electric Car?*

Fri ,13/01/2012

 Who wants to kill the electric car? Apparently, a lot of people do. During the 1920’s, the Milburn electric cars were popular, particularly with the ladies who didn’t like cranking gasoline engines to start them.  In 1928, General Motors bought the Milburn out and it disappeared. In 1996, the EV1 electric cars appeared on roads in California. They were quiet and fast and produced no exhaust fumes. They were manufactured by GM under a mandate to reduce vehicle emissions. Ten years later, these futuristic cars were almost completely gone. A documentary, Who Killed the Electric Car , determined that the batteries were not the problem but that the culprits were mainly oil companies who stood to lose enormous profits if EV sales took off and GM, who didn’t think they would make enough profit from the car. If GM had developed and improved the EV1, they might not have gone bankrupt.

House Of Cards: Much of the damage to the EV1 was done by misinformation directed at politicians, regulatory agencies, and the consumer. The same campaign is being used against the new crop of electric cars. In a Seeking Alpha article, Why The Electric Vehicle House Of Cards Must Fall, John Petersen continues the tactic. First, Mr. Petersen determines the value of an electric car by using an “analysis that starts with a $19,000 gasoline powered vehicle, deducts the costs of unnecessary internal combustion drivetrain components and then adds the incremental costs of necessary electric drivetrain components.” This analysis found a $38,800 cost for an electric vehicle. That cost is not unreasonable but the analysis is something like taking a conventional oven, stripping it, and adding parts to convert it to a microwave. There are many hybrids and electric cars on the market that have an MSRP much less than $38,800, such as the 4 passenger Mitsubishi MiEV which is rated at 112 MPGe and listed at $21,625. The price of the vehicles will certainly come down, as Department of Energy Secretary Steven Chu said at the Detroit Auto Show he expects the cost for electric car batteries to drop from a whopping $12,000 in 2008, to $3500 by 2015 and $1500 by 2020. Currently there are waiting lists to purchase many electric cars and hybrids because of high demand, so there is little chance for price negotiations.

The article goes on, “Electric drive proponents are selling a house of cards based on fundamentally flawed assumptions and glittering generalities that have nothing to do with real world economics. Their elegant theories and justifications cannot withstand paper, pencil and a four function calculator.” However, Mr. Petersen bases his economic analysis on his $38,800 cost and a list of subsidies from what he calls an “extraordinary article”, The Real Costs of Alternative Energy by Alex Planes . Fortunately for the future of electric cars, Mr. Planes’ real costs are extraordinarily misleading.

Subsidies: Mr. Planes says, “a clear-headed look at the true costs of energy is something many — including our political leaders — sorely need.” He goes on,“Subsidies are just one of the costs of supporting alternative energy, but are they worth it?” Using U.S. Energy Information Administration data, Mr. Planes calculates the subsidies to energy sources in terms of the dollars per barrel of oil equivalencies. The subsidies he comes up with are coal: $0.39, oil and gas: $0.28, solar: $63, and wind $32.59. Based on his values, he says renewable energy’s costs to the government are “in some cases so high, and the actual energy returns so low, that it hardly seems worth the investment. Solar’s pitiful slice of American power use — less than a single day’s worth of oil consumption — is underwritten by enough taxpayer money to simply buy most of the power outright and provide it to taxpayers for free.” Subsidies are a poor way to estimate “true costs” as they are more indicative of the perceived future value of the resource to society.

True Cost? The reason Mr. Planes article is extraordinarily wrong is that he does not really give you the “true cost” of the use of fossil fuels. The true cost  of a resource includes not only the price but also the cost of cleaning up the environment and disposing of the waste. Fossil fuels dispose of their waste by releasing it into the air which causes damage to the environment and health problems for many Americans. We are in effect subsidizing the fossil fuel industry by the cost of allowing them to freely discharge their wastes into the environment. Any effort to determine the “real cost” of subsidies should include health and environmental costs. Mr. Planes says in the comments section of his article that he perhaps should rewrite his article to include what he calls the external costs. In the meantime, many people are using his incomplete analysis to disparage sustainable energy sources.

A Truer Cost: It is difficult to come up with an exact value for the “real subsidies” to the fossil fuel industry, but it is possible to estimate their magnitude. Top economists such as Britain’s Nicholas Stern, using the results from formal economic models, estimates that if we don’t limit our carbon emissions, the overall costs and risks of climate change will be equivalent to losing at least 5% of global GDP each year, now and forever. If a wider range of risks and impacts is taken into account, the estimates of damage could rise to 20% of GDP or more in the future, and we would run the additional risk of an environmental catastrophe.

Using 5% of the US GDP for 2010 would give an environmental cost of $727 billion. The American Lung Association estimates that the EPA’s proposed guidelines for particulates could prevent 38,000 heart attacks and premature deaths, 1.5 million cases of acute bronchitis and aggravated asthma, and 2.7 million days of missed work or school. They estimate the economic benefits associated with reduced exposure to soot to reach as much as $281 billion annually. Those two add up to about $1.01 trillion, and when divided by the 13541 million barrels of oil equivalent given in Mr. Planes article for coal, gas and oil together amounts to an additional subsidy of $73.9 per barrel of oil equivalent. The subsidies to wind and solar electric energy do not look so bad if you actually use fossil fuels: $74, solar: $63, and wind: $32.59. The calculations do not include all the environmental and health costs, but they do give an idea of how much we are subsidizing the fossil fuel industries by ignoring the damage to people’s health and the environment. Then there is the added risk of an environmental catastrophe.

 Disclosures: In an apparent effort to be evenhanded, as required by Motley Fool, Mr. Planes then concludes, “Wind and solar power have their drawbacks, but continue to make notable improvements year after year. However, neither option can yet provide the clean, constant, and convenient power the world demands. Natural gas offers the best opportunity for the near term. It’s plentiful, well-developed, and efficient, and will take on greater importance as dirtier hydrocarbons lose market share. ” Mr. Planes then offers you a free analysis of an “exciting opportunity to play the natural gas boom, by investing in a small company turning our oil-guzzling vehicle fleet into clean-burning natural gas machines.” He disclosed that he holds no stock in natural gas vehicles, but he may not be disclosing a bias against renewable energy. He refers to one of Robert Bryce’s books in his paper and his analysis sounds much like those in Mr. Bryce’s “Power Hungry: The Myths of ‘Green Energy’ and the Real Fuels of the Future”. In Mr. Bryce’s  5 Myths about Green Energy, he attacks green energy using false comparisons, misquotes, scientific inaccuracies, and the omission of pertinent facts. It is not surprising that  Mr. Bryce is not a fan of green energy as he is a senior fellow at the Manhattan Institute, which receives large donations from the Koch Foundation and Exxon/Mobile.

 Mr. Petersen, using Mr. Plane’s analysis, finds, “The law of economic gravity cannot be ignored and will not be mocked. Shiny new electric vehicles from General Motors, Ford Nissan, Toyota, Tesla Motors and a host of privately held wannabe’s like Fisker Motors and Koda are doomed to catastrophic failure. Their component suppliers will fare no better. There is no amount of political or wishful thinking that can change the inevitable outcome.” When Mr. Petersen was asked about the omission of health and environmental costs in a comment on his article, he replied he was only interested in “hard authoritative numbers.”

 Obscenity? Mr. Petersen goes on, “The ultimate obscenity is that a conversion from gasoline drive to electric drive will not reduce the total amount of energy used in transportation. It merely shifts the energy burden from lightly subsidized oil and gas to more heavily subsidized energy from coal, nuclear and renewables.”  Not really. The amount of energy used would be reduced even if using electricity from traditional coal fired power plants to charge the electric vehicle. Coal-fired power plants have a thermodynamic efficiency of about 30%. Electric motors are now about 90% efficient in converting electric energy to work and when considering friction, power line transmission losses, energy lost when the batteries are charged, and the energy gained by regenerative braking, the overall efficiency of using coal to run electric cars comes out around 20%. Internal combustion engines have a thermodynamic efficiency of about 15% but drive train losses reduce that to an overall efficiency around 10%. These efficiencies are reasonable as a  paper by Stanford University  comparing “source to wheel efficiencies” rated the electric Tesla at 1.145 km/MJ of and the gasoline powered Honda Civic at 0.515 km/MJ. At current prices, that figures out to about 5 cents/mile for the Tesla and about 12 cents/mile for the Honda.

  Using sustainable energy sources to charge the batteries would be the ideal case as the “energy source to wheel” efficiency would be 60 to 80% and the carbon emissions would be greatly reduced.  There would be a substantial savings in energy and carbon emissions even if using electric cars charged using coal-fired power plants. Electric vehicles have the added advantage that the infrastructure to charge the batteries is already in place. The electric car does not seem to be built on such a house of cards as Mr. Petersen’s article suggests.

An article titled Investors See Climate Opportunity to Make Money, Create Jobs, reports 450 large institutional investors who control more than $20 trillion worldwide, agree “climate change is a risk to avoid and also an opportunity to make a good return on investments.” It reports “Global clean-energy investments reached $260 billion in 2011, some five times more than the $50 billion in 2005.” Our energy needs will best be served by a mixture of traditional and alternate energy sources and we should not let pessimistic analyses keep us from investing in and developing the alternate sources.

* Revised to include a more recent Stern Report on 01/22/2012.

 (c) 2012 J.C. Moore

 

The EPA vs. Oklahoma Power Companies

Sat ,21/05/2011

The EPA has been charged with reducing the pollutants released into the environment, but they are meeting opposition from power companies, politicians, and people who want cheap energy, though other people’s health and the environment may suffer the consequences . The EPA is accepting comments on the issue through May 23, 2011.  (1)

The Environmental Protection Agency is seeking a 95 percent reduction in emissions at three of Oklahoma’s coal-fired power plants owned by OG&E and AEP. (2) This has brought howls from the utility companies and from Oklahoma’s politicians. Utility companies claim that installing scrubbers or converting to natural gas will cost them billions of dollars and drive the rates for electricity up by 10 to 12%. The utility companies have defined the costs for the plant conversions or upgrades in the worst possible terms, without considering the long-term savings of conversion to natural gas or the impact on people’s health.

EPA.  Stopping the EPA has been put forth as a Conservative and a Republican cause, but it really is neither. President Richard Nixon created the EPA to protect the environment as the United States developed industrially. The Clean Air Act was passed not only to reduce smog in our cities, but to ensure that the air was kept pure and clean in our national parks and wilderness areas. Under the Clean Air Act, the EPA has the right to limit sulfur oxides, nitrogen oxides, organic compounds, and particulates to ensure the quality of the air in our region. Limiting regional haze would have the added benefit of improving the health of people, wildlife, and plants in the region. Sulfur and nitrogen oxides are known to damage plants and those, along with small particulates, cause respiratory problems in people. Also, the particulates emitted contain mercury, arsenic, lead, cadmium, chromium, dioxins, and radioactive isotopes, which are all health hazards.

Regional problem. The emissions from Oklahoma plants do not remain in Oklahoma, and some of the haze in Oklahoma likely comes from surrounding states, particularly Texas, which has a large number of unregulated power plants. Emissions from a source may remain in the air for many weeks and travel for hundreds of miles. Although each state in the region might wish to address its own air pollution problems, it is a regional problem and must be addressed as such. Some of the states in the region are regulatory averse, and may lack the political will to act in the matter. For instance, a fly ash disposal plant at Bokoshe Oklahoma was allowed to operate for seven years while it violated Oklahoma statutes and apparently caused health problems and possibly deaths among Bokoshe residents.

Cost. The main objection to limiting emissions at the power plants is the cost. However, the power plants have operated for years without paying the true cost of energy production, which should include the cost of limiting their air pollution. It also appears that the companies have overstated the costs by as much as two or three times over the EPA estimates.  AEP reported $1.2 billion in profit last year and OG&E $292 million, so they can apparently afford to address the problem without passing all the costs to  customers.

Timetable. Three years would be a reasonable time for the power plants to come into compliance. It has been known for several decades that the emissions are damaging to the environment and health, yet the companies did not act. Also, the EPA had previously informed the companies that they were out of compliance, yet they have failed to come up with a satisfactory plan. They should have made a move toward compliance long ago, and further stalling should not be allowed.

Alternate plan. The alternate plan of converting the power plants to natural gas is certainly an acceptable plan. Methane produces about 2 1/2 times as much energy per unit of carbon dioxide as coal. And, switching to methane would also alleviate the problem of properly disposing of fly ash, bottom ash, and scrubber sludge. Those, and carbon emissions will necessarily be regulated in the future. Addressing the haze, the solid and liquid waste, and the carbon emissions piecemeal will certainly be less effective and more costly in the long run. If the companies should choose to convert the plants to methane, the added benefits would justify an increase in the timetable of up to five years.

(1) Comments may be submitted to r6air_okhaze@epa.gov or at http://act.credoaction.com/campaign/oklahoma_coal_pollution/?r=7901&id=21282-3213732-Kunk_Zx

(2) http://jcmooreonline.com/2011/03/17/the-problem-with-coal-and-politicians/

(c) 2011 J.C. Moore

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The Problem with Coal and Politicians

Thu ,17/03/2011

The EPA has been charged with reducing the pollutants released into the environment, but they are meeting opposition from power companies, politicians, and people who want cheap energy, though other people  and the environment may suffer the consequences.

The Environmental Protection Agency is seeking a 95 percent reduction in emissions at three of Oklahoma’s coal-fired power plants. This has brought howls from the utility companies and from Oklahoma’s politicians. Utility companies claim that installing scrubbers or converting to natural gas will cost them billions of dollars and drive the rates for electricity up by 10 to 12%. The utility companies have defined the costs for the plant conversions or upgrades in the worst possible terms, without considering the long-term savings.  Conversion to natural gas would eliminate the problem of  coal combustion products such as acidic gases, mercury vapor, fly ash, and bottom ash. Although coal is cheaper than other fuels, it delivers less energy per unit of CO2 produced. Coal  produces 314 kJ/mole while natural gas produces 890 kJ/mole, almost 3 times that of coal. Considering Oklahoma’s abundant supplies of natural gas, it would make sense for Oklahoma to begin switching power plants to natural gas.

The power companies and the politicians have tried to define the problem as the cost of the  “elimination of haze”, as if there were no other environmental damage done by burning coal. That is because the elimination of haze under the Clean Air Act is all the EPA is presently empowered to do. Coal is 65 to 95 % carbon. What about the rest? Coal contains small amounts of mercury, chromium, lead, cadmium, arsenic, sulfur, particulates, and radioactive isotopes. Man burns 6 billion tons of coal each year, releasing millions of tons of pollutants into the air and leaving several hundred million tons behind in the coal ash. Some pollutants eventually find their way into the water, the food chain, and into us. Oklahoma has adopted limits on fish consumption because of high levels of mercury. For comparison, mercury is 100 times as toxic as cyanide, arsenic is 20 times as toxic, and chromium(VI) is 4 times as toxic. These three are also are carcinogenic and accumulate in tissue. Even exposure below the allowed levels increases the chance of cancer over time. The small town of Bokoshe, Oklahoma is located near an unregulated fly ash disposal site. The incidence of cancer among the residents of the town is extraordinarily high, though the power company claims there is no link between that and their fly ash.

The sulfur and nitrogen oxides released by coal combustion harm plants and produce acid rain. A recent article headlined “Pecan growers say coal-fired plant killing trees” described the plight of orchards downwind from a power plant with inadequate pollution controls. One farmer said his pecan crop dropped over the years from 200,000 to 8,000 pounds. The combustion of coal  also releases 30 billion tons of carbon dioxide into the air each year. Because  CO2 in 3water is an acidic, the oceans have become over 20% more acidic in the last century. That has led to the destruction of coral reefs and endangered crustaceans and the phytoplankton that convert CO2 to oxygen. Without phytoplankton, life in the oceans would be impossible. The concentration of CO2 in the air has increased 38% as well.  As a potent greenhouse gas, it is causing the Earth to warm, glaciers and polar ice to melt, and the climate to change in ways we will not always like. The Supreme Court, in Massachusetts v. EPA, ordered the EPA to make a determination as to whether carbon dioxide is a pollutant. The EPA has found, based on the best scientific evidence, that CO2 is an endangerment to public health and has moved forward to regulate it.

Oklahoma’s politicians, such as Sen. Jim Inhofe and  Congressman Dan Boren, are working on a solution- for the power companies benefit. They want to strip the  EPA of  its power to regulate pollution.  They also claim it is a states rights issue, and that the EPA has no business regulating Oklahoma industries. However, the pollution generated by Oklahoma’s power plants does not stay within its borders, nor is all the pollution in Oklahoma from Oklahoma sources. Much of it blows up from Texas, the state with the highest number of power plants out of compliance. Acidic gases released by coal combustion, and even mercury vapor, can travel for thousands of miles before being brought to Earth by precipitation, and much of the CO2 will stay in the air for centuries. Regulation of carbon emissions needs to be done on a national and even international level. It is a bad idea to focus on short term economic costs while ignoring the environmental costs, such as polluting the Earth and letting rural Oklahoma become a dumping ground for the power companies’ waste.

(C) 2011 J.C. Moore

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Should the EPA Limit Carbon Emissions?

Wed ,29/12/2010

The U.S. Republican leaders are blocking climate legislation, leaving the EPA in the position of having to regulate carbon emissions. Many Republicans in Congress are unhappy with the EPA and are now claiming the EPA regulation of CO2 is a “power grab”.

Progress has been limited at the climate meetings in Copenhagen and in Cancun because the U.S. has not acted to restrict its carbon emissions. The U.S. is second to China  in emissions but emits six times as much CO2 on a per capita basis. If the U.S. is not willing to reduce its emissions, why should other countries?  The U.S. came very close to passing cap-an-trade but it failed when John McCain (R Az) backed out of the deal because of a challenge from a far right candidate in the last election. Reducing CO2 emissions has been cast as a liberal issue and many conservatives oppose it for that reason. The wins by Republicans in the last election almost insure that action on a responsible policy will be delayed by at least two years. That is a shame as many Republicans in the past have been strong supporters of the environmental issues.

The Republican leadership adopted opposition to environmental regulations as a campaign strategy. They sent out propaganda based on slick reports produced by conservative think tanks, rather than science, and they inflated the cost of environmental legislation by a factor of twenty – while not mentioning any of the benefits. The propaganda has been passed along to voters in town hall meeting and press releases. The EPA has used science as a basis for its decisions and has moved to limit CO2 emissions as an air pollutant under existing regulations in the Clean Air Act. This has infuriated many Republicans anfd they have challenged the EPA’s right to do, calling it a “power grab”.

My Congressman,  Frank Lucas (R-OK), has spoken disparagingly of environmental regulations in his town hall meetings and in opinion pieces he has sent to the states major newspapers. He also writes a column that goes to many small town newspapers called “Frankly Speaking”. In his column, he has  labelled the EPA’s actions to limit carbon emissions as  “the EPA power grab” . That is hardly the case. The Supreme Court, in Massachusetts v. EPA, found the Environmental Protection Agency could make a determination as to whether carbon dioxide is a pollutant. The EPA has found, based on the best scientific evidence, that CO2 is an endangerment to public health and has moved forward to regulate it.

If Congress had acted to develop a sound energy policy and to curb pollution, the  EPA would not be forced to act in the matter. Regulations passed to limit carbon emissions would fall mainly on the coal industry and would favor a shift in the short term to petroleum and natural gas, both abundant in Oklahoma. Many from the petroleum and gas industries originally supported the cap-and -trade bill. However, all the OK Republican Congressmen sat out the process and let the Democrats from coal producing states load up the cap-and-trade bill with perks for coal producing states. Some of  Oklahoma’s industrial leaders see that limiting carbon emissions could be favorable to the Oklahoma economy, but apparently, the elected representatives have not caught on yet.

And, it is not just about the CO2 or climate change. Along with the 30 billion tons of CO2 we put into the air annually are large amounts of mercury, lead, cadmium, arsenic, sulfur oxides, nitrogen oxides, particulates, and radioactive isotopes of radon. Those end up in the air, the water, and the food chain. We are now finding mercury in fish and some places, even in Oklahoma, have limits on consumption. The oceans are now 20% more acidic and economically important fisheries are threatened. Whether we cap pollution, tax it, or strictly regulate it – something must be done and soon. The EPA regulation is a stop gap meaure and the U.S. Congress needs to stop the politics and pass a sound energy policy and meaningful environmental regulations.

(C) 2010 J.C. Moore

Is EPA Regulation of CO2 a “Power Grab”?

Fri ,19/03/2010

Congressman Frank Lucas (R-OK), in Frankly Speaking (3/10/2010), wants to rein in what he calls “the EPA power grab” to limit carbon emissions. That is hardly the case. The Supreme Court, in Massachusetts v. EPA, ordered the environmental protection agency to make a determination as to whether carbon dioxide is a pollutant. The EPA has found, based on the best scientific evidence, that CO2 is an endangerment to public health and has moved forward as instructed.

If Congress had acted to develop a sound energy policy and to curb pollution, the  EPA would not be forced to act in the matter. Regulation of carbon emissions would fall mainly on the coal industry and would favor a shift to petroleum and natural gas, both abundant in Oklahoma. However, all our  Republican Congressmen sat out the process and let the Democrats from coal producing states load up the cap-and-trade bill with perks for coal producing states. Some of  leaders see that limiting carbon emissions could be favorable to the Oklahoma economy, but apparently, our elected representatives have not caught on yet.

It is not just about the CO2 or climate change. Along with the 30 billion tons of CO2 we put into the air annually are large amounts of mercury, lead, cadmium, arsenic, sulfur oxides, nitrogen oxides, particulates, and radioactive isotopes of radon. Those end up in the air, the water, and the food chain. We are now finding mercury in fish and some places have limits on consumption. The oceans are now 20% more acidic and economically important fisheries are threatened. Whether we cap pollution, tax it, or strictly regulate it, something must be done and soon.