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17 June 2004JOHN R. WILSON, TMG/ENERGY1 ENERGIZING OUR FUTURE A RATIONAL LOOK AT OUR ENERGY CHOICES FOR THE 21 ST CENTURY PRESENTED AT THE TECHNOLOGY FORESIGHT.

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Presentation on theme: "17 June 2004JOHN R. WILSON, TMG/ENERGY1 ENERGIZING OUR FUTURE A RATIONAL LOOK AT OUR ENERGY CHOICES FOR THE 21 ST CENTURY PRESENTED AT THE TECHNOLOGY FORESIGHT."— Presentation transcript:

1 17 June 2004JOHN R. WILSON, TMG/ENERGY1 ENERGIZING OUR FUTURE A RATIONAL LOOK AT OUR ENERGY CHOICES FOR THE 21 ST CENTURY PRESENTED AT THE TECHNOLOGY FORESIGHT MEETING, NCMS, ANN ARBOR, 17 JUNE, 2004

2 17 June 2004JOHN R. WILSON, TMG/ENERGY2 A FEW FACTS CURRENT WORLD ENERGY USE: ~400 QUADS PROJECTED 2020 CONSUMPTION: ~610 QUADS MAY BE MORE IF CHINA MAINTAINS PRESENT PACE 1.9 MILLION BBL/YR IN BILLION BBL/YR IN 2025 – AN INCREASE OF ALMOST X2000 WHERE WILL THE INCREASE OF 210 QUADS BY 2020 COME FROM? IT HAS TO BE OIL, NATURAL GAS, COAL…VIA DERIVATIVES LIKE ELECTRICITY, HYDROGEN… RENEWABLES WILL NOT CONTRIBUTE MUCH IN THE U.S., ONLY 12% NOW AND MOST OF THAT IS HYDROELECTRIC. ONLY WIND ENERGY IS GROWING SOLAR PV OR SOLAR THERMAL IS TOO COSTLY FOR OTHER THAN POOL HEATING OR DRIVEWAY LIGHTS.

3 17 June 2004JOHN R. WILSON, TMG/ENERGY3 THE USUAL MYTHS (1) WE ARE RUNNING OUT OF OIL DEPENDS WHAT OIL IS BEING DISCUSSED CONVENTIONAL, LOW-COST OIL? YES, IN THE U.S., SINCE THE 1970s; IN ~20-40 MORE YEARS GLOBALLY UNCONVENTIONAL, HIGHER-COST OIL? NO, NOT FOR A LONG TIME – BUT IT WILL COST A LOT MORE BY ~2020 ESPECIALLY IN THE U.S. CANADA – E.G., DEEP OFFSHORE GULF, ARCTIC, OIL SANDS, EVEN SHALE OIL THERE IS ALMOST CERTAINLY A LOT OF UNPROVEN, UNEXPLORED OIL IN IRAQ, LIBYA, SAUDI ARABIA SOME OF THIS IS REALLY CHEAP OIL BUT RAPID GROWTH IN WORLD DEMAND WILL ENSURE THAT PRICES, AS OPPOSED TO COSTS, REMAIN HIGH WORLD-WIDE, SUPPLIES ARE GOOD FOR 50 YEARS, MAYBE 75 – BUT THE PRICE WILL HURT BY 2020 OR SO.

4 17 June 2004JOHN R. WILSON, TMG/ENERGY4 THE USUAL MYTHS (2) WE HAVE UNLIMITED NATURAL GAS RESOURCES NO IN NORTH AMERICA! YES GLOBALLY U.S. HAS 8-10 YEARS OF PROVEN (= ECONOMICALLY VIABLE) RESERVES – FAR SHORT OF PROJECTED NEEDS WE ARE ALREADY IMPORTING INCREASING AMOUNTS OF LNG AT ~$4.50, THUS FURTHER INCREASING OUR ENERGY DEPENDENCE THERE IS A LOT MORE GAS IN HIGH-COST UNPROVEN AREAS DEEP OFFSHORE, ARCTIC OFFSHORE, MARINE AND PERMAFROST METHANE HYDRATES, COAL BED METHANE, TIGHT GAS. WILL TAKE MANY YEARS, HUGE INVESTMENTS, TO DEVELOP NONE WILL BE DEVELOPED BY INDUSTRY UNLESS GAS PRICES HOLD AT OR ABOVE PRESENT LEVELS – NEED >$10/MMBTU! PLENTY OF GAS IN GEOPOLITICALLY DIFFICULT AREAS – E.G., RUSSIA, KAZAKHSTAN, IRAN, QATAR…BUT NOT U.S. AND CANADA LONG-DISTANCE TRANSPORTATION OF LNG HAS ITS RISKS CONVERT GAS TO LIQUIDS, TRANSPORT THOSE INCOGNITO AS IN QATAR NOW

5 17 June 2004JOHN R. WILSON, TMG/ENERGY5 THE USUAL MYTHS (3) THE HYDROGEN ECONOMY WILL SAVE US! IT WILL NOT HYDROGEN IS AN ENERGY CARRIER, NOT A SOURCE IT MUST BE MADE FROM GAS, OIL, MAYBE COAL IT DOES NOTHING FOR OUR ENERGY INDEPENDENCE UNLESS WE FIND A WAY TO MAKE IT AT A COMPETITIVE COST FROM RENEWABLE RESOURCES – & WE HAVENT! SOME COMPARATIVE COSTS ON THE NEXT SLIDE CONVERSION OF NATURAL GAS, OIL, COAL TO HYDROGEN ARE ALL TECHNICALLY POSSIBLE, AT A PRICE. ALMOST ALL GENERATE SOME OF THEIR HYDROGEN FROM STEAM [E.G., METHANE REFORMING CH 4 + H 2 O 3H 2 + CO] THE ONLY ECONOMICALLY VIABLE OPTIONS ARE NATURAL GAS (WE DONT HAVE ANY TO SPARE], COAL (USES A LOT OF WATER), MAYBE NUCLEAR/REFORMING (NOBODY WANTS IT!)

6 17 June 2004JOHN R. WILSON, TMG/ENERGY6 HYDROGEN MANUFACTURING COSTS [FEBRUARY 2004 NRC STUDY] Production Method` (Central Station = centralized manufacture of hydrogen at national or regional facilities) CURRENTFUTURE $/KG$/GJ$/KG$/GJ Natural Gas, Central Station + Distribn Natural Gas, Distributed Manufacture Coal, no sequestration, Central Station Coal with sequestration, Central Station Nuclear [steam reforming, not electrolysis]N/A Biomass [Midsize Plant] Electrolysis, Grid Power Electrolysis, Wind Power Electrolysis, PV with Grid Backup Gasoline w/Hybrid Efficiency, H 2 Equivalent2.12N/A?? Euro Diesel w/Hybrid Efficiency, H 2 Equ.1.68N/A??

7 17 June 2004JOHN R. WILSON, TMG/ENERGY7 A LOOK AT THE FUTURE WE HAVE A LOT OF COAL (257x10 9 MT) IN U.S., CANADA AS DOES THE REST OF THE WORLD (727x10 9 MT) GOOD FOR SEVERAL HUNDRED YEARS AT PROJECTED USE RATES BUT WE NEED TO FINISH DEVELOPING CLEAN COAL TECHNOLOGY – PREFERABLY WITH CO 2 SEQUESTN THERE IS A LOT OF WELL-ESTABLISHED OLD (1978) TECHNOLOGY FOR CONVERSION TO WIDE RANGE OF FUEL LIQUIDS, GASES NEED TO STOP TALKING, START DOING ON CLEAN COAL – AND TO STOP SPENDING THE $$ ON HYDROGEN HYDROGEN IS GREAT AS A CHEMICAL FEEDSTOCK FOR HYDROGENATION, BUT NOT AS A FUEL SOME WOULD PREFER TO SEE NUCLEAR RATHER THAN COAL, BUT PUBLIC RESISTANCE IS LIKELY TO PREVENT THIS

8 17 June 2004JOHN R. WILSON, TMG/ENERGY8 A LOOK AT THE FUTURE IN GENERAL: ENERGY PRICES WILL CONTINUE TO RATCHET UPWARD SLOWLY WITH NO LONG-TERM RELIEF TRADERS IN ENERGY COMMODITIES (WHO REALLY CONTROL PRICES) WILL CONTINUE THEIR PARANOIA AND OVER-REACT TO OPEC ANNOUNCEMENTS, MID-EAST DISTURBANCES, REFINERY FIRES…..AND THUS CONTRIBUTE TO RISING PRICES WE WILL CONTINUE TO USE HYDROCARBON FUELS FOR AT LEAST 50 MORE YEARS, BUT WITH INCREASING EMPHASIS ON CO 2 SEQUESTRATION (OR SOME NEW EQUIVALENT), LOW-CARBON FUELS AND BIOFUELS (WITH ZERO NET CARBON EMISSIONS) THE INFRASTRUCTURE IS IN PLACE FOR LIQUID FUELS, HYDROCARBON GASES, BUT NOT FOR HYDROGEN. ELIMINATION OF CO 2 ALONE WILL NOT ELIMINATE GLOBAL WARMING. IT IS ONLY ABOUT ONE-THIRD OF THE PROBLEM! GET USED TO IT!

9 17 June 2004JOHN R. WILSON, TMG/ENERGY9 A LOOK AT THE FUTURE TRANSPORTATION (PERSONAL, COMMERCIAL) LIQUID FUELS WILL PREVAIL, INCLUDING: BIOFUELS WITH CLOSED-LOOP CARBON CYCLES (BIODIESEL, BIOMASS-BASED GTL (FT) FUELS OXYFUELS (SUCH AS DIPROPYL ETHER OR DIPENTYL ETHER) AS GASOLINE AND DIESEL ADDITIVES OR EVEN SUBSTITUTES – THEY ARE INEXPENSIVE AND RELATIVELY CLEAN HYBRID POWER TRAINS – ESPECIALLY DIESEL/ELECTRIC – WILL PLAY A MAJOR ROLE UNTIL WE CAN COME UP WITH A MUCH BETTER LOW-C POWER SOURCE THAN HYDROGEN FOR SOME YEARS, EVs AND SOLAR POWERED VEHICLES WILL PLAY A MINOR ROLE BECAUSE OF HIGH FIRST COSTS AND BATTERY REPLACEMENT COSTS – THEY HAVE A BETTER LONG-TERM FUTURE LI-ION BATTERIES CAN ACHIEVE THE RANGE, BUT COST IS HIGH HYDROGEN VEHICLES WILL FIND A NICHE – A SMALL ONE – STARTING IN ABOUT 2025 BUT WILL NOT BE A SIGNIFICANT FACTOR FOR YEARS, IF EVER.

10 17 June 2004JOHN R. WILSON, TMG/ENERGY10 A LOOK AT THE FUTURE MANUFACTURING ELECTRICAL – WILL BECOME MUCH MORE COSTLY NATURAL GAS – SHORTAGES LIKELY BY GAS WILL ALSO BECOME MUCH MORE COSTLY. SHORTAGES WILL END BY , BUT PRICES WILL REMAIN HIGH LIQUID FUELS – WILL ALSO BECOME MORE COSTLY BUT ABSENT INTERNATIONAL CONFLICT, NOT BY AS MUCH AS GAS – A BREAK FROM TRADITION THERE WILL GROWING USE OF LIQUID FUELS FOR DIESELS OR GAS TURBINES THAT ARE CARBON-NEUTRAL OR OFFER LOW-CARBON EMISSIONS (BIODIESEL, BIOMASS TO LIQUID (BTL) FUELS) HYDROGEN WILL BE USED FOR STATIONARY FUEL CELLS ONLY, BUT BEWARE REAL-WORLD HYDROGEN COSTS – THEY WILL ALSO INCREASE AS FUEL COSTS INCREASE ABSENT ANY REAL PROGRESS IN LARGE-SCALE RENEWABLE ENERGY DEVELOPMENT TRUST BUT VERIFY - PERFORM A SOURCE-TO-USE ENERGY AND COST ANALYSIS!

11 17 June 2004JOHN R. WILSON, TMG/ENERGY11 A LOOK AT THE FUTURE CONCLUSIONS… GRADUAL TRANSITIONS OVER ~50 YEARS, NO SUDDEN STEP FUNCTIONS HYBRID POWER TRAIN TECHNOLOGY WILL PREVAIL FOR MOST FORMS OF TRANSPORTATION BY GRADUALLY INCREASING PRICES FOR OIL, GAS WILL PROVIDE INCENTIVE FOR DEVELOPMENT NEW HIGH-COST ENERGY SOURCES STARTING …RIGHT NOW! CONCERN OVER CO 2 WILL DRIVE INTRODUCTION OF TECHNOLOGY SUCH AS CARBON SEQUESTRATION BY 2015 RENEWABLES WILL FOCUS ON WIND POWER, BIOMASS CONVERSION TO LIQUIDS – HAPPENING NOW HYDROGEN WILL FIND A NICHE IN AUXILIARY/BACK-UP POWER GENERATION, BUT NOT IN TRANSPORTATION

12 17 June 2004JOHN R. WILSON, TMG/ENERGY12 THE UNAVOIDABLE COMMERCIAL: For more information, please contact: John Wilson, President TMG/ENERGY (A Unit of TMG/The Management Group) P.O. Box Grosse Pointe, MI, USA (also 4653 Bradbury Ct., Windsor, Ontario, Canada N9G 2M2) Tel: or Fax: OR Web site:


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