peak oil & wind power in ny (presentation)

8/7/2019 Peak Oil & Wind Power in NY (presentation)

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Peak Oil & Wind Power

in NY for 2011-2031

By David Bradley and Derek Bateman

March 2011

[email protected] and [email protected]

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Apocalyptic Horsemen?

Peak Oil implies rapid future oil price increases

Can lead to severe price based rationing, price spikes,

no oil access and

subsequent problems

Global Warming cause by (mostly) CO2 pollutionfrom fossil fuel burning

Combined, they make for a wicked duo

Were not the original four Horsemen enough?

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Oh oh!

The United States is presently environmentally &economically unsustainable, energy-wise

Particularly regarding Peak Oil and Global ClimateChange

Wont be able to fix this without a significant greenenergy and green jobs effort

This requires getting energy pricing right

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Peak Oil Where production rate is at or near a maximum level Cant be increased even if prices rise significantly

Leads to Demand Destruction/big price rises

Occurs when 50% of Ultimately Recoverable

Resource (URR) has been produced

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Peak Oil is: A liquid fuels problem

Transportation problem

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Hubert Linearization We are at 50% of URR

(URR = Ultimately Recoverable Reserves)

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Global Climate Change CO2 pollution = CO2 generated by

burning fossil fuels

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Global Climate Change CO2 into atmosphere is greater than the

ocean and land can absorb

Heat from sun retained is greater than theheat radiated into space

Net result melting ice and warming planet

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What it is Global warming is a long-term problem

of: climate, weather, rainfall, oceanlevel/acidification

Peak Oil is a short-term problem of

Economic, food, transportation, etc

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UKs Stern Report Addressing Peak Oil will require a 20

WWII style mobilization

It could cost 3% - 4% to prepare for PeakOil

Or a loss of 10% to 12% of GDP if we wait

until the threat hits

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Peak Oil Challenge What happens when gasoline/diesel

gets above $5.00 to $20.00 a gallon?

Transportation gets expensive

Distance becomes a larger expense

Food prices rise

Global economy forced to get morelocal

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Peak Oil Economic Effect Acts as a regressive sales tax

Less disposable income for most of us

Less demand for other things

Exports money from US go to oilimports

Less tax revenue for governments

Education, health etc12


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Export Land Model - 1It is the export rate of oil that tends to set world oil prices

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Export Land Model - 2


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The problem in your side mirror is closer thanyou might think!

Peak Oil related - both are problems that need to be dealt with 15


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Export Land Model - 3 At present (2011) 41 mbd exported

- 50% of all production

In 2016 < 30 mbd exported

- 40% of all production

More oil customers, less oil

- do the math..

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ELM Predictions

Peak production now means higher prices

Higher prices do not give greater production

Higher prices will not stop decline in exportedoil rates/quantity available to be bought

Less supply and more consumers will meandemand destruction even higher prices

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Oil is:

Oil is 45% of US CO2 pollution source

Oil is $1 billion/day import habit

Oil imports are major drag on our economy Stopping oil imports = major economic

growth opportunity

Means replacing all oil imports ASAP

Means eventually replacing all oil use

U.S. supplies are still depleting18


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China & India & Coal China and India will set coal prices

- Coal production is peaking in China, too

India is a major coal importer

US coal that can be exported will have aworld price, and will no longer be cheap

2008 - US spot coal -> $150/ton

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Feed-In Tariffs (FITs) Prices = production cost plus reasonable profit

Different prices for different sources

Stable prices until capital investment paid off

Cost for capital > usually 75% of total operating cost

Can be subsidy free; no need for carbon prices20


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Merit Order Effect (MOE) Wind can lower prices in a mixed

renewable/polluting energy marginal

price system (NYISO) More wind tends to give lower average

prices

Does haircut on windfall profits ofpaid off polluting energy facilities(coal, nukes); savings go to consumers

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FITs Work!

Cheaper than subsidy/quota system

No subsidies needed

Priority access is all that is needed aspolluting energy replacementmechanism

Low risk = lower cost financing

50% wind, 75% PV, 95% biogass

Best system yet found for stimulatingjob growth/technology for renewables 22


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New York State of Mind

Sheldon Wind Farm, Wyoming County, NY23


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New York Renewable

Electricity Pricing Existing hydro - lowest production cost

Commercial on-shore wind

Biogas landfill gas

Biomass biogas without co-generation

Hydrokinetic, wave and tidal generation

Off-shore wind turbines Small scale wind turbines

Solar PV - highest production cost24


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Electricity Requirements 16 GW existing (3 GW present)

10 GW natural gas replacement (heat)

4 GW electro-fuels

2 GW electric/plug-in hybrid cars

2 GW energy storage (pumped hydro)

Total = 32 GW average usage (34 GWrequired to deliver 32 GW)

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Electricity Sources 18 GW on-shore wind = 54 GW Capacity

9 GW off-shore = 22.5 GW capacity

3 GW hydro

2 GW tidal

2 GW biomass

LOTS OF JOBS! (4 million job-years manufacturing and installation plus

multiplier effects, average total jobs (20 yrs) ~ 1 million) 26


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Electricity Capital Costs On-shore 54 GW = $135 billion

Off-shore 22.5 GW = $90 billion

Tidal 2 GW = $20 billion

Biomass 2 GW = $4 billion

Pumped Hydro 20 GW = $22 billion

Total = $271 billion (over an ~20 year period)

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Renewable Electricity Costs 32 GW delivered = 280,512 GWhr/year

Capital = $271 billion

Annual amortization costs = $21.7 billion

O & M = $5.4 billion

Total $27.1 billion or 9.6 cents Kwh

Initial costs will be cheaper as the lower capitalcost technologies are Installed first

This was the 2008 New York City/Long Island price forgenerated electricity

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Liquid Fuels Approach -

A 50% by 50% Plan Double gas mileage for same vehicle miles traveled

per year (vmty) - from 22 mpg to ~ 44 mpg

Drops liquid fuel consumption by 50% Cut by fuel consuming car vmty by 50%

Drops the remaining fuel consumption by 50%

25% of original fuel consumption rate

Current liquid fuel consumption not possible tosupply with biofuels, nationwide OR statewide

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New York Current Liquid Fuel

Consumption Rates 130 million barrels per year (mby) gasoline

40 mby diesel (cars, trucks, trains, heating oil)

30 mby kerosene (jet fuel, heating oil)

Trucks to trains will reduce diesel usage

Trains to electric trains will serve freight and

passenger use Airplane usage will drop precipitously

More rail passenger traffic - from short haul air

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Results of 50% x 50%: Gasoline usage drops to 32 mby

Equivalent to 48 mby ethanol (EtOH)

Diesels can be replaced with highcompression ethanol (25 to 1)

Some diesels can be ammonia powered

You can get greater efficiency with highcompression engines

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Biofuels Plan - 1

Grow 375 million bushels/year corn on 2.2million acres/170 bushels per acre

Needs 219,000 tons per year ammonia (NH3) Also makes 7.875 million tons/yearstover/corn cobs (75% of that grown)

Use 25% of stover (2.625 m tons/yr) as fuel

for heating corn fermentation plants Makes 25 mby EtOH, 3.3 million tons/yr

DDGS (30 wt% protein)32


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Biofuels - 2

Make 12 mby EtOH from stover

Make 10.5 mby from hydrogenating CO2from corn fermentation

Make 4.5 mby from hydrogenating CO2 fromstover (cellulosic ethanol)

Needs 3.4 GW electricity to make the H2

from the H2O raw material NH3 needs 219 MW for its H2

EtOH fermentation plants need 110 MW33


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Estimated Capital Costs Liquid Fuels

EtOH fermentation from corn kernels = $1.5billion (9 new plants)

EtOH from stover = $2.5 billion (10 plants)

EtOH from CO2 and H2 = $4 billion (10plants)

Total = $8.5 billion (including $0.5 billion NH3 plants)

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Estimated Fuel Production

Costs EtOH by fermentation = $2.20/gal

EtOH cellulosic = $4.00/gal

EtOH via H2 = $6.00/gal

The low-cost technologies would beinstalled first

The higher priced ones could be installedas petroleum price rises justify

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Summary

Tremendous stimulus for manufacturing

Tremendous boost for rural areas

Fuel crops, fuel manufacturing

Stover Wind turbine lease income

Provide stable and predictable electricity prices

Eliminates all polluting electricity sources

Eliminates money bleed for fossil fuel imports Path to eliminate petroleum usage/imports

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Conclusion

It is possible to make New York State renewablypowered in a generation

It cant happen with marginal pricing for energy

(electricity and liquid fuels) It cant happen when polluting energy sources

set the prices for renewables

For electricity without sensible pricing (FITs)

renewable electricity cant happen in NY, USA If we dont get renewable electricity based, our

economy stagnates and declines37


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Merit Order Explanation 1

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Merit Order Explanation 2

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Any Questions?

Bard 5 MW, Germany Enercon 7 MW, Belgium40

peak oil & wind power in ny (presentation)

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