Can Government Make a Disaster From Nothing at All?

IHS Global Insight of Massachusetts under a contract from the American Petroleum Institute has rolled out its report about the consequences of a Federal takeover of the regulations from states overseeing the oil and gas well finishing process called “hydraulic fracturing.”

Before we start, hydraulic fracturing is packing water, some solvents, and strong sand and special chemicals into the rocks thousands of feet down so that oil and gas can flow back out.  It’s a kind of miniature, slow motion cracking of the rocks much further out from the little well hole.  One could also call it an explosion, but it takes hours, running into days to build up the pressure, to get some cracking and pack the sand into the fissures.  It turns a little hole into solid rock into a hole in lots of little rocks.

It’s just critical to keep this technology in use and further development.

Hydraulic fracturing has a 50 year history beginning with quite simple pressure buildups to today’s highly sophisticated multi directional wells in rocks that only a half decade or so ago were considered hopeless repositories of petroleum.  Today, using hydraulic fracturing a well or even a set of wells can release huge quantities of natural gas.  This can easily be seen in the natural gas price at the home meter to fertilizer for food and investments in even more production.  In the coming months more technology is coming and is being blended with technology that looks into the earth to guide where more effort should be applied.

All that, the potential and the world’s lowest prices of natural gas for Americans are at risk from a disaster of rearranging (and adding) regulations.  The Federal proposal is so bad that the amazing situation of business preferring a single regulatory framework over 50 regulations from the states is not preferable.  Yup, government can make a disaster from nothing at all, which isn’t amazing at all.

The matter is a fully Democrat sponsored attempt to place regulations of the Safe Drinking Water Act thousands of feet down below any source of water for human use.  The bills, a House version and the Senate versions are very similar, which cautions one to realize this is a concerted attempt to subvert the existing framework of petroleum operations and regulations into a whole new field of bureaucratic interference.

Just to make things worse, the Feds propose not to unify regulations; they want to ADD a Federal layer.  IHS Global Insight’s study, “Measuring the Economics and Energy Impacts of Proposals to Regulate Hydraulic Fracturing,” predicts the number of new U.S. wells drilled would plummet 20.5 percent in the first five-year period.  That would potentially reduce natural gas production by about 10 percent from 2008 levels by 2014, a mere 5 years out.

Remember the last marginal buyer’s impact on prices?  Carving off 10% of supply isn’t going to be cheap for heating homes, running business and industry or generating electricity.  Someone is passing put stupidal capsules in D.C.

There are problems, to be sure. In the fight last month the Ground Water Protection Council released a study that finding regulation of oil and gas field activities, including hydraulic fracturing, is best accomplished at the state level where regional and local conditions are best understood and where state regulators are on hand to conduct inspections and oversee specific operations like well construction, testing and plugging.

The Ground Water study is an excellent piece to grasp what’s been going on and raises the issue about why the Feds are digging here for more power anyway.  The history and background discussed go far to understand the process and that a few states are behind.

Is it serious?  If you live over a leaking well it is, but those aren’t so common as many would have us believe.  What is an issue is the control and enforcement of the law on the books.  Some states do lack enough oversight.  Arguments over who is to pay for control and cleanup is usually in the domain of lawyers consuming time and often more money than the clean up.  Drives people nuts, understandably, but is more regulation and economic costs the answers to the problems?

Today in the U.S., where over 95 percent of wells are routinely treated using fracturing, the impact of eliminating hydraulic fracturing on production would be “permanent and severe,” the IHS report notes.  The production slippage would be significant.  Part of the new regulations is to restrict the types of materials used to fracture rock.  You and I both know better than to think any Congressperson(s) can better decide what’s appropriate to use.  But IHS has figured that the proposed regulations would impact gas production falling 4.4 trillion cubic feet or 22 percent, while oil production could slip 400,000 barrels per day or 8 percent.  These are major numbers, tearing out more than the marginal buyers, driving prices to unpredictable new highs.

API President Jack Gerard said, “More than one million wells have been completed using this technology. Unnecessary regulation of this practice would only hurt the nation’s energy security and threaten our economy.”  That’s public relations nicety comment.

In raw numbers the study found elimination of the use of hydraulic fracturing would be catastrophic to the development of American natural gas and oil, with a 79 percent drop in well completions, resulting in a 45 percent reduction in natural gas production and a 17 percent reduction in oil production by 2014.  Those are real American jobs.

Everyone world wide would be affected.  Today the U.S. is a very small importer of natural gas.  The proposed bill would certainly change that forcing the U.S. into the world natural gas market in a big way.  No one, other than some special interests, injured parties frustrated at state responsiveness and a raft of natural gas exporters stands to gain.  And the last ones to benefit would be the injured Americans, anyway.  Just imagine the resentment of the world at the U.S closing in even more production.  This is a way past being a stupid proposal.

But in the end the IHS report is a model, but it’s formed up from real numbers from a solid historical database asking trends from the elimination of components.  Not a particularly complex or difficult problem. “When 95% of current wells could not be drilled the impact would be” isn’t real hard to grasp.  Debating over even double digit errors still leaves the economy in a huge disaster.

The geothermal folks better wake up on this too.  Hydraulic fracturing is going to become important in the geothermal field soon.

So I have to ask myself, what are the side effects from stupidal capsules? Sleeping better, better vigor and health, ah, making more money?  There’s a motive in there begging for a journalist’s investigation.  It won’t happen, it’s too incredible to believe to start with, but it is a proposed bill.  Yup, government can make a disaster from nothing at all.  Just pass around some campaign money and stupidal capsules.


Here is the original: New Energy and Fuel

The Wind Power Storage Issue

Storing the energy from wind is obviously useful.  But is it essential?  Numerous studies cover the matter both asserting that storage can useful and asserting its not.  The practical common result is the continental U.S. could increase wind energy production another ten times before the capacity would merit storage at scale.

It’s just not that simple.  In Hawaii where the ocean limits interconnection over a wide area the local conditions rule.  To get to high wind use a buffer needs to be in place between the source, the wind and to the consumer.  Hawaii has a 70% renewable target and to get there some form of moving energy production from the time it’s generated to the time it’s used has to be in place.

But numerous studies as well as European wind integration experience have demonstrated that in the continental 48 states the use of wind energy could increase by more than 10-fold without energy storage.  The opportunity is in using the sources of flexibility that are already present on the electric grid. Every day, grid operators constantly accommodate variability in electricity demand and supply by increasing and decreasing the output of the flexible generators – power plants like hydroelectric dams or natural gas plants that can rapidly change their output of generation.

The peak demand is met by the stored energy in the dammed water or the natural gas in the tank or pipeline.  Grid operators also move power from regions with momentary excesses of electricity to other regions that have a need for electricity at that moment. Grid operators use these same flexible resources to accommodate any additional variability introduced by wind energy.

In the U.S. now, demand for electricity can vary by a factor of three or more depending on the time of day and year, which nationwide translates into hundreds of gigawatts of flexibility that are already built into the power system.

Its almost always much cheaper to use the existing flexibility than to build new sources of flexibility like energy storage facilities.  When the existing sources of flexibility are eventually saturated, a number of additional low-cost sources of flexibility can be deployed, such as building additional transmission lines, encouraging additional demand response resources, reforming grid operating procedures, or making the generating fleet more flexible.

Continuing advances in energy storage technology can make it more economically competitive as a provider of grid flexibility.  Its important to remember that resources like wind energy can already be cost-effectively and reliably integrated with the electric grid without energy storage for quite some time to come.

Compare that to Hawaii’s plan to install a 15-megawatt battery on a new 30-megawatt wind farm.  Computers will work to keep the battery exactly half-charged most hours of the day. If the wind suddenly gets stronger or falls off, the batteries will smooth out the flow so that the grid sees only a more gradual increase or decrease, no more than one megawatt per minute at some hours of the day.

The Hawaiian installation is designed to succeed at a crucial but obscure function: frequency regulation. The alternating-current power system has to run at a strict 60 cycles per second, and the battery system can give and take power on a micro scale, changing directions from charge to discharge or vice versa within that 60th of a second, to keep the pace steady.

The battery system can also be used for arbitrage, storing energy at times when prices are low and delivering it when prices are high. It can hold 10 megawatt-hours, which is as much energy as a 30-megawatt wind farm will produce in 20 minutes if it is running at full capacity. That is not much time, but it is huge in terms of storage capacity. The reason for the arbitrage?  Publicly disclosed figures put the project in the range of $130 million, with about $10 million for the battery. The Energy Department has provided a $117 million loan guarantee.  Folks in Hawaii are going to pay, but the cost of the investment will be lower with all of the U.S. backing the plan up.

Isolated power systems like Hawaii’s seem like highly unique cases, since geography prevents them from sending excess electricity to neighboring regions there is limited access to sources of power system flexibility, the power grid is often weak, and the price of electricity is often high.

The success of countries like Spain, Germany, Denmark, Portugal, and Ireland reliably and cost-effectively obtaining 10% or more of their electricity from wind farms without adding any storage resources is instructive.  As well, the main grid operator in Texas has regularly obtained 20% of its electricity from wind energy, also without the use of energy storage.

The National Renewable Energy Laboratory summed the matter up in a remote quote, “At present levels of wind penetration on the electrical grid, storage has not been a priority consideration. But eventually, as system resources and not exclusively due to wind or other renewable resource capacity adds on, the nation’s electrical grid will benefit from energy storage technologies. Essentially, the power system already has storage in the form of hydroelectric reservoirs, gas pipelines, gas storage facilities, and coal piles that can provide energy when needed. Today, storing electricity is more expensive than using dispatchable generation. In the future, through, advances in technologies such as batteries and compressed air, energy storage may become more cost-attractive.

The point is that Hawaii is an isolated set of islands that needs to store back energy production and move it to the time its needed.  The other side of the point is, as the renewables become a larger proportion of the total, the continental U.S., as big as it is, is a set of islands as well.


Original post: New Energy and Fuel

Getting Bio Diesel With Molds and Fungus

One way to increase world bio oil production that would cause a low ecosystem impact is to use lipids from single-cell oil microorganisms (also called oleaginous microorganisms), which present many significant advantages over plants. Oleaginous microorganisms, such as yeasts, fungi, bacteria, and microalgae, can accumulate high levels of lipids and do not require arable land, so in the conventional sense, they do not compete with food production.

Researchers in Spain at Universidad Rey Juan Carlos (URJC), have demonstrated the direct transformation of biomass consisting of the fungus M. circinelloides into biodiesel compliant with the U.S. ASTM D6751 and the EU’s EN14213 and 14214 standards. A paper on their work was published online back on April 2nd 2010 in the ACS journal Energy & Fuels.

Biodiesel consistsing of fatty acid methyl esters known as FAMEs has many advantages, such as high energy density, great lubricity, fast biodegradation rate, and reduced emissions of sulfur, aromatic compounds, and particulate matter. But biodiesel adoption is complicated because it competes with the food industry for the main raw material input, plant oils, and the worldwide supply of plant oils is limited by land and water availability.  There has been a rapid expansion in biodiesel production in not only developed countries most noticeably in the United States and the European Union, but also developing countries are working to substitute fuel production for subsistence farming.

Oleaginous yeasts and fungi have also been considered as potential oil sources for biodiesel production because they accumulate large amounts of lipids. Among these microorganisms, particular attention has been dedicated to various oleaginous zygomycetes species, such as Mortierella isabelina and Cunninghamella echinulata, which may accumulate up to 86% and 57% of lipids in the dry biomass, respectively.

Now for the plus or minus depending on your point of view, The experimental fungi are able to grow and accumulate large amounts of lipids in cultures containing raw glycerol sourced from biodiesel production as a carbon source. Glycerol is the major byproduct of the biodiesel production, and its recycling to produce oleaginous microbial biomass could significantly increase the unit revenue of biodiesel production.

The results of the lab production are very encouraging.  The URJC team cultivated M. circinelloides in a liquid medium containing glucose as a carbon source at 20 grams per liter. Under the experimental conditions, the fungus grew very quickly consuming all of the available glucose and stopped growing in the first 48 hours after inoculation the spores into the liquid medium. After 96 hours, the team obtained 4.17 ± 0.25 g/L fungal biomass with a total lipid content of 22.9 ± 0.9% dry mass.

Fungal Biomass Biodiesel Production Diagram. Click image for the largest view. Image Credit: Universidad Rey Juan Carlos

The saponifiable lipids, those that can be transformed into the desired FAMEs and free fatty acids (including energy storage and structural lipids) were 98.0 ± 1.3% of the total lipids extracted from the biomass.  This is rich stuff.

With the experiment’s production at such high concentration of the free fatty acids the team determined that an acid-catalyzed process was more suitable for producing biodiesel than an alkali one to avoid yield losses from free fatty acid neutralization.

The team used the acid-catalyzed direct transformation method with methanol and chloroform as solvents; with trials of  H2SO4, HCl, and BF3 as acid catalysts. The team found optimal reaction conditions at 8 hours at 65 °C. The respective biodiesel yields were 18.9, 18.9, and 18.4% relative to the dry mass using the three catalysts.

The fungus strain is called MU241 derived from R7B after replacement of its leuA mutant allele by a wild-type allele, was used as a wild-type strain to produce fungal biomass.  The team reports, “The level of neutral lipids (storage lipids) increased with time during the cultivation of this fungus, which means a decrease in the relative proportion of all of the structural lipids with this variable. In fact, the amount of structural lipids in a microorganism is concrete, and therefore, it has to keep constant with time. In contrast, lipid accumulation in M. circinelloides was 18.9% at 24 hours, increasing only slightly after this time.”

The team compared production of their MU241 strain working in a liquid with known solid growth results.  There results suggest that the fungal biomass from liquid cultures in the dark shows better characteristics for biodiesel production than that from solid cultures.

Not only is the product rich, its very high quality.  Depending upon the catalyst used, the ester content ranged between 99.0 and 99.2%, which is significantly higher than the corresponding specified minimum value in the European Union standard of 96.5%. These values were higher and the reaction was faster than those reported for other oleaginous microorganisms, in which an acid-catalyzed direct transformation method was used. Furthermore, the amounts of all the byproducts analyzed were below the maximum allowed values for American and European standards. Thus, the contents of individual glycerides (mono-, di-, and triglycerides) were within the biodiesel specifications, indicating that the transesterification and esterification reactions were complete.

The bio diesel is also quite chemically clean – the free glycerol was lower than the two standard limits showing the glycerol residues were eliminated during the purification treatment making the individual glyceride and free glycerol levels below the established limits. The total glycerol content also met all of the standards.  The acid values were also within the specifications in all reactions. Additionally the non-saponifiable lipids were not detected in the new biodiesel, which means that these types of lipids were also eliminated during the purification stage.

There remains but one small problem – the biodiesel obtained had small quantities of polar lipids, which were lower than 0.9% in all cases. These compounds are residuals of nonconverted polar lipids, and they are not as of yet considered in the established biodiesel specifications.

The Spanish team can be quite proud of their achievement; efficient biodiesel production by direct transformation of fungal biomass without lipid extraction is technically feasible, which represents a starting point for developing this process on an industrial scale.

Fungal research might need to catch up with bacterial and algal efforts in the genetic manipulation area.  Questions remain on feeding the fungus – coming up with glycerol isn’t a major answer – especially as the U.S. Congress has lunched, dined and partied its way out of keeping the biodiesel seed incentives in place and the industry healthy enough for progress.  The bio middle distillate market is in deep trouble in the U.S. with only the military and airframe manufacturers still providing support.  It’s a warning shot, well artillery, shot warning to any industry that the economy needs to develop new energy and fuel resources.

The U.S. is only 25% of the world market leaving a huge opportunity out there. The Spanish research goes far to getting a new path on the table, intensifying the competition for bio diesel   It’s a pity the U.S. is essentially out, there are great resources that could put strong legs under the Spanish achievement’s potential.  But, it will come – the results are just too good to overlook.


The original is here: New Energy and Fuel

Wind to Fertilizer Construction Begins

The Associated Press must be the only press release recipient for some major news. The University of Minnesota Renewable Energy Center at Morris Minnesota has designed a $3.75 million carbon-free system that uses wind power from a towering turbine to produce anhydrous ammonia, NH3, a the most common and widely used nitrogen fertilizer and a component of most other nitrogen fertilizers. Construction started on the Morris plant the week of June 7, 2010, and it should produce fertilizer by the end of the year.

The NH3 plant will use the surplus energy generated onsite by a 1.65-megawatt wind turbine that already helps power the nearby campus.

The U.S. is the largest importer of fertilizer in the world, with more than half its NH3 coming from overseas. The country imported about $1.4 billion worth of NH3 in 2009, or 6.1 million U.S. tons, according to the U.S. Department of Agriculture.

Wind Driven Hydrogen Production Plant in Utsira Norway. Click image for the largest view.

The system creates fertilizer by using an air separation unit to pull nitrogen from the air, while the turbine powers large electrolyzers that separate water into hydrogen and oxygen. The nitrogen and hydrogen are then synthesized into anhydrous ammonia using a century-old chemical process called the Haber-Bosch Process.  The technology is proven, a hydrogen system model is functioning in Utsira, Norway.  Using wind to power the electrolyzers instead of natural gas frees a large market share and makes NH3 production a carbon-free process that releases no greenhouse gases.

Wind Driven NH3 Process Block Diagram. Click image for the largest view.

The motive is easy to explain.  Before the oil price spike and the credit crisis NH3 would sell to farmers for near to $200 per ton.  At the current price of about $500 a ton, competition will be possible but difficult. But if prices return to the near-$1,200-per-ton range seen a couple of years ago when natural gas prices spiked the wind process would be wildly profitable.

The NH3 price issue is of great concern to the corn market and thus to food and ethanol production.  The 2008 price run-up was followed by a sharp drop, but many farmers had already contracted prices for the spring of 2009 and had to take the NH3 at the stunning high price.

John Holbrook of Richland, Washington based NHThree LLC , an ammonia expert exploring its use as a motor fuel points out the big impediment to a profitable wind-to-fertilizer system is the electrolyzer.  NHThree is working on a new process called solid-state ammonia synthesis, which could improve efficiency by bypassing the Haber-Bosch Process and the electrolyzer.  But UM at Morris is going ahead with their construction.

UM at Morris isn’t alone – San Francisco-based SynGest, Inc., plans to build an $80 million facility about 40 miles west of Des Moines, Iowa, that will produce ammonia fertilizer from corn cobs, and an Oregon nonprofit called the Northwest Hydrogen Alliance Inc. is studying the feasibility of storing energy by producing anhydrous ammonia using cheap excess hydropower at off-peak times during the spring melt to produce anhydrous ammonia for use as fertilizer or to store hydrogen.  There are lots of others, too working on NH3 fuel.

Check those numbers – that $1.4 billion divided by the 6.1 million tons comes to $229.51 leaving more than $270 per ton for transport, storage and profits from the $500 per ton current price.  Lots of people should want in the NH3 business.  The volumes are large enough that there’s 3100 miles of ammonia pipelines in the U.S.

The test plant will produce fertilizer for use on the university’s own research farmland.  The venture would again make NH3 a renewable commodity, which it was until the 1950s and 1960s.  NH3 production in the early 1900s was powered primarily by hydropower, but producers stopped that method after realizing they could make it more cheaply using natural gas.  Well, now the wind is free – it’s the capital cost and operating expense that’s at issue.

The researchers at the University of Minnesota deserve congratulations.  A search on wind and ammonia shows they’ve been at this for quite a while.  The incentives are strong, the capital expense significant and the impact of NH3 as a product in the national economy is far more fundamental that most people realize.

Production of hydrogen and on to NH3 has lots of potential from fertilizer or to use as a fuel.  Making NH3 would get the energy store into a low-pressure tank, that stays put and is easily transported.

Time will tell in the real numbers on viability.  The university pilot is small and loaded with research equipment – just how that relates to a commercial facility is yet to be seen

Michael Reese, director of the University of Minnesota Renewable Energy Center was quoted by the Associated Press saying, it’s a perfect supply-and-demand match, as the region has no shortage of wind and U.S. farmers use millions of tons of fertilizer

Its obvious now it can be done, just how low a price can be found?


The original post: New Energy and Fuel