29 September 2005

Oye'd! to Carbon

Okay, let's try this again for my benefit:

Coal Gasification

The chemical reaction for coal gasification is
H2O + C → CO + H2, ΔH = +131 kJ
CO + H2O → CO2 + H2, ΔH = -41 kJ

So overall we turn 1 mole of Carbon into 2 moles of diatomic Hydrogen and 1 mole of Carbon Dioxide for an ideal energy input of 90 kJ.

Thus the ideal energy input is 47 kJ/mol of H2 = 22.32 MJ/kg of H2. The ratio of Hydrogen to Carbon by mass is 1 kg:5.96 kg.

Burning Carbon

Carbon is burned to Carbon Monoxide and then Carbon Dioxide:
2C + O2 → 2CO, ΔH = - 221 kJ
2CO + O2 → 2CO2, ΔH = -566 kJ

Therefore pure carbon yields 393.5 kJ/mol = 32.76 MJ/kg

In contrast, coal is not nearly so good a fuel because it contains water and other contaminants. I picked Illinois bituminous coal at 11,800 Btu/lbs. This coal is equivalent to 27.5 MJ/kg. This is basically why coal is not considered a transport fuel. Note that this is basically the highest quality coal that we burn for fuel. The best stuff is saved for steel manufacture. The carbon content would be about 65 %. Oxygen and Nitrogen constituents take up many bond positions and lower the overall recoverable energy. Hydrogen adds some energy with much of that bound as water, and Sulfur a very tiny amount.

More info on coal available here:


Note this article states that Illinois bitluminous coal produces 203.5 lbs. of CO2/MBtu. With 11,800 Btu/lbs. the mass ratio coal:CO2 is 1:2.4013, which you can use to confirm the carbon content of 65 %.

Gasification Inputs

As mentioned before, the ideal input is 22.32 MJ of heat and 5.96 kg of Carbon to produce a single kilogram of Hydrogen gas.
1. Heating input: 22.32 MJ of heat at 55 % cycle efficiency is 40.58 MJ. Given energy content of 5.63 MJ/kg, a total of 7.2 kg of coal must be burned for fuel. Now obviously the efficiency of this stage can be challenged.
2. Chemical input: 5.95 kg of carbon is needed, and the coal has 65 % Carbon content, for a total input of 9.154 kg. This stage should be around 99 % efficient.

TOTAL COAL INPUT = 7.2 kg + 9.15 kg = 16.35 kg of coal / kg of H2

Cost Input

Coal is priced at $40/short ton = $0.02/lbs. = $0.0442/kg.

So our 16 kg of coal costs $0.723.

Obviously I made some sort of bad error in my last post. I will probably have to stop trying to run through multiple calculations using just my calculator since I'm generating too many lazy errors. :-) Of course, this took about five times as long to write.

CO2 Pollution Credits

With 16.35 kg of coal consumed and 65 % Carbon content the total carbon combusted is 10.63 kg. This works out to 38.94 kg of CO2. Recall, again, this is for one kilogram of H2. We can check this with the EIA derived ratio of 1 kg coal:2.4 kg CO2 → 39.25 kg of CO2 .

I'll examine two potential electolysis costs. $40/MWh is ultra-cheap electricity derived from a high quality wind resource. $74/MWh was the average cost of electricity in the states for 2003. At $40/MWh electrolysis H2 is $2.10/kg; at $74/MWh it's $3.885/kg. The difference between gasified coal and electrolysis is $1.38/kg and $3.162/kg respectively. Obviously the cost of electricity is a very sensitive parameter!

The cost to buy CO2 credits to make up the difference is now $35.4/ton for the $40/MWh case and $81.2/ton for the $74/MWh case.

I can actually make up a formula for this to see how the cost of electricity varies the CO2 price point:

Cost CO2 credit = [1.346/tonMwh] PElec - $18.5/ton

where PElec is the price of electricity in $/MWh.


I'll take a look at steam reforming again later. I probably made the same error there. The electrolysis numbers are still correct.

27 September 2005

Hydrogen: What source?

I wanted to do some calculations on Hydrogen and from what source it could potentially be produced. Ergosphere has done a similar post but I wanted to examine it from a Kyoto perspective.

I made the following assumptions:
  1. Electricity at $40/MWh from wind.
  2. Natural gas at $15/GJ.
  3. Illinois coal at 23.6 Mbtu/short ton, cost of $40.00 per short ton.

H2 Source

Ideal Energy Input


Expected Efficiency (%)

Real Energy Input (MJ/kg)

Unit Cost


H2 Cost




















As we can see, the cost of coal-derived Hydrogen is vastly lower than that of methane or electrolysis derived Hydrogen. The question I want to know is, in some carbon-trading scheme like Kyoto, what rate does CO2 have to trade at for electrolysis to become viable?

I figured out the amount of CO2 produced from the combination of actual material input and the heating requirement. For example, methane, with a heating value of 55.7 MJ/kg has a heating input of 0.67 kg of methane per kg of Hydrogen (which is about 1.8 kg of CO2), and 22 kg of CO2 are produced from the actual chemical reaction to split the methane.

H2 Source

CO2 Produced (kg CO2 / kg H2)

Marginal CO2 Cost (relative to CH4) ($/ton)

Marginal CO2 Cost (relative to coal) ($/ton)













As you can see, Methane is the winner even with its assumed high price. Carbon dioxide needs to be trading at $62/ton in order for electrolysis produced Hydrogen to be competitive. Obviously I'm being rather kind to Hydrogen by giving it cheap wind power and pushing the cost of natural gas well above the world average (if not so much above the North American average).

Note that the implications for sequesterization are clear. If CO2 can be sequestered for less than $60/ton, methane should remain the preferred feedstock for Hydrogen. If it can be sequestered for less than $20/ton, coal is the winner.

25 September 2005

New Digs

I've made some changes to the template to make use of more of the screen. The existing template was too congested. IE doesn't appear to like the changes. I don't know what the problems are with IE -- I'm not sure if I care.

Works with Mozilla, Firefox, and Opera...

Update: Microsoft IE works fine at 1280 x 1024 resolution but not any others... Ergh.

A Rational Case for Biofuels

I think a picture is worth a thousand words, when it comes to the asinine arguments of the biofuel lobby:

Biofuels like biodiesel and ethanol represent a carbon neutral energy commodity. The plants they are produced from consume all the Carbon Dioxide liberated in burning them. Because they are hydrocarbons, they are fungible. They are energy dense, can be stored for long periods of time and are easily portable.

The greatest drawback of biofuels is that they cannot replace more than a small fraction of our current oil consumption. There simply isn't enough arable land available in the world to grow the crops that would be needed to fuel our oil habit. Realistically we might be able to replace 5 % of our current oil consumption with biofuels. Therein lies the inane nature of the biodiesel Hummer -- it may be renewable, but it is not sustainable.

My thought is, however, that we should not dismiss biofuels simply because their lobby groups are stupid. Instead, I think they have an important part to play as one component in a multi-faceted approach to the replacement of oil. The key is to exploit the portability of biofuels. In my viewpoint, biofuels and hydrogen are direct competitors as fungible fossil fuel replacements. Neither biofuels or hydrogen reduce our energy consumption.

In sharp contrast, an integrated approach to reduce the amount of energy we consume for personal transportation can increase the role of biofuels. To make biofuels significant we need to do the following:

  1. Conservation
  2. Superior well-to-wheel efficiency
  3. Offset load to electricity

Conservation incorporates a whole variety of factors to reduce consumption. Public transportation is one. Reduced speed limits with photo-radar enforcement is another. Reducing highway speed limits to 90 km/h could increase fuel economy by 15 %. Note that conservation is technology independent.

The biggest gain in conservation to be made is by switching to smaller cars. The current spat of SUVs are oversized beyond our needs. Mandating a switch to smaller vehicles, through something like a feebate, could drastically increase fuel economy. A fleet-wise mileage gain of 25 % from a progressive feebate is quite possible, and the impacts of rising gasoline prices will probably further assist it. Realistically, until GM goes bankrupt, we probably won't see a serious conservation effort in North America. As a huge employer General Motors welds great influence with politicians which allows them to continue their short-sited strategy of pushing giant vehicles. Toyota will pass GM as the world's largest car manufacturer soon enough.

I will assign conservation a 40 % decline in our per capita oil consumption.

The second step is to pick vehicle and energy sources technologies that produce a high well-to-wheel efficiency. The well-to-wheel efficiency of a spark ignition gasoline car is only about 13 %. Gains can be made by incorporating hybrid technologies like regenerative braking, auto-shutdown when stopped at red lights, storing energy from downhill runs for uphill climbs, etc. Switching to compression ignition (Diesel) combustion engines can also increase efficiency by 50 % over spark ignition. Studies have shown that a diesel-hybrid can have 3x the well-to-wheel efficiency of spark ignition engines.

As an aside, fuel cell car powered by electrolysis-produced hydrogen would have a similar well-to-wheel efficiency as gasoline cars. I.e. the hydrogen economy will not reduce our energy consumption.

The third step is to switch transportation load from portable energy sources like gasoline or biodiesel to electricity. This clearly lies in the gradual introduction of the plug-in hybrid (PHEV) with ever increasing all-electric range. A plug-in hybrid with a range of 30 km could easily replace 75 % of hydrocarbon consumption simply because most people don't drive that far in a day.

Electricity can more easily be produced from carbon neutral energy, whether it be renewables, nuclear, or sequestered clean coal. Moreover, the round-trip efficiency of electricity can be extremely high. If we consider power from wind, the electricity may lose 10 % of its energy to transmission losses; Li-ion batteries have a round trip efficiency of 90 %; electric motors can be 95 % efficient. The well-to-wheel efficiency in this case is a staggering 77 %. The plug-in hybrid also can act as grid voltage regulation, mitigating the intermittent aspects of renewable power sources like wind.

So what is the cumulative effect of these three ideas?

Conservation reduces our per capita normalized oil consumption from 1.0 to 0.6. We then replace 75 % of that load with electricity, reducing consumption to 0.15. Now calculate that the switch to the diesel-hybrid increases efficiency by a factor of three, so 0.15 / 3 = 0.05.

Guess what, through these three steps we have reduced our fossil fuel consumption to 5 % of its current value. Remember, how much off our current oil consumption we might be able to replace with biofuels? It's the same number. We can potentially replace all of our fossil fuel consumption for personal transport with biofuels. At the same time, energy consumption would be only 15 - 20 % of its current number, which has great implications for sustainability.

While this may be a simplistic analysis, it does show that biodiesel production could be on the same order of magnitude as consumption. Even if biodiesel and Fischer-Tropsch diesel from biogas can't meet all our oil consumption needs, fossil fuel consumption would be tiny compared to today. Carbon Dioxide emissions would be trivial in comparison, and peak oil would no longer be an issue.

Now, obviously this only addresses personal transportation and not freight transportation. Still, it shows that huge advances can be made in an incremental fashion to our current transportation industry.

21 September 2005

Thermochemical Hydrogen

There are a variety of thermochemical processes available for the production of hydrogen. The methane steam reforming cycle is the most efficient, but it produces Carbon Dioxide, which is considered bad. There are processes that take only water as an input, and hence could be considered direct competition for electrolysis . The most popular of these in the literature is the Sulfur-Iodine cycle:

I2 + SO2 + 2H2O → 2HI + H2SO4 (120 oC)
H2SO4 → SO2 + H2O + 0.5 O2 (850 oC)
2HI → I2 + H2 (300 - 450 oC)

As you can see the Sulfur and Iodine are recoverable, making this a recyclable process. The thermal efficiency of this cycle for nuclear power plants can be higher than the thermal efficiency of electricity production combined with electrolysis. For example, this detailed study found an ideal efficiency of 51 % (possibility higher with membranes) and an actual efficiency of 36 %. Such a reactor should still be capable of converting the remaining thermal power to electricity at around 30 % efficiency. Hence a thermochemical hydrogen reactor could potentially output 50 % hydrogen, 15 % electricity, and 35 % waste heat.

Hydrogen produced from nuclear power is a popular topic with Hydrogen economy advocates such as Dr. Ballard. However, there is a key drawback to using nuclear thermal energy for the Sulfur-Iodine process: most nuclear reactors simply don't operate at 850 oC. New reactors with novel cooling systems such as helium or sodium are necessary to produce the requisite temperatures.

While these numbers for the Sulfur-Iodine cycle may look impressive, I don't think hydrogen advocates are doing themselves any favours in pushing for new, untested nuclear technology. In reality, it represents another huge capital cost on the 'bridge' to a hydrogen economy.

The three main nails in the coffin of the hydrogen economy are:

  1. Well-to-wheel efficiency
  2. Storage
  3. Financial potential gap

Well-to-wheel efficiency is a major drawback of hydrogen. Principally, hydrogen does not reduce our energy consumption because its overall efficiency is similar to that of spark ignition gasoline vehicles. A diesel-hybrid, on the other hand, can increase efficiency by a factor of three. Hydrogen advocates often gloss over this problem, choosing to examine the high tank-to-wheel efficiency of fuel cells rather than the low well-to-tank efficiency of hydrogen production. I would submit, however, that as a portable, carbon-neutral energy source hydrogen is inferior to biofuels. After all, if we want hydrogen as a portable energy source, and we don't feel electricity storage is up to the task, why shouldn't we compare the energy return on energy investment (ERORI) of hydrogen to biofuels like corn-based ethanol or biodiesel?

Let's take David Pimetal of Cornell's study of ethanol production. This is widely regarded as one of the most hostile treatments of ethanol around. Even for corn, one of the worst sources of biofuel available, Pimetal finds an ERORI of 71 %. If every Joule of input into the production of corn-based ethanol was electricity, it would still have a superior ERORI to electrolysis-produced hydrogen. There's nowhere to go but up for biofuels, while hydrogen is stuck stationary due to the laws of thermodynamics.

Storage is a well known problem. Solid-state methods are generally no better than batteries; pressurized storage is potentially dangerous and consumes energy; cryogenic storage consumes a huge proportion of the heating value of hydrogen for the cooling process. Carbon-fuels -- whether from renewable sources or not -- have a much higher energy density while electricity can lay claim to far superior return rates (in excess of 90 % for Li-ion).

The financial potential gap is the chicken and egg paradox of infrastructure. No one can afford to build hydrogen fuel infrastructure until they have a market, and no consumer can afford to buy a hydrogen powered car without the supporting fuel infrastructure. This is in sharp contrast to incremental technologies like the hybrid. The hybrid has several paths where it can make incremental improvements in fuel economy and carbon economy while slowly evolving the existing infrastructure. It can improve the ancillary equipment, by transforming from mechanical belts and transmissions to electrical systems. It can enlarge the battery capacity, becoming a plug-in hybrid with increasing all-electric range with every generation. It can switch from spark-plug ignition to compression ignition (i.e. diesel). It can incorporate biofuels such as ethanol, biogas, or biodiesel into its tanks in increasing proportions. A fuel economy advances, it will become practical to advance from E5 to E20 to E40. Essentially, while the hydrogen economy faces a fiscal cliff, the hybrid only has to climb a set of stairs.

19 September 2005

Conversion Booboo

I seem to have mucked something up on the conversion from the evil arhaic units used to quantify natural gas and the power outputs a nuclear plant would need to replace them. I blame the American engineers that came up with mcf to represent a thousand cubic feet of natural gas. I blame them for the British Thermal Unit too, just because.

The actual conversion numbers are:

1 mcf = 1.027 Mbtu = 1.083 GJ (thermal) = 301 kWh (thermal)

Since current tar sands production is around one million barrels a day, consuming according to the Syncrude corporate reports 1.35 mcf/bbl, then the actual energy consumption is equivalent to a 12,540 MW continious thermal output.

This isn't the danty little 100 MW reactor I was talking about. It's more like 4 mondo 900 MW CANDU reactors -- something on the scale of Pickering, Ontario. Since production is expected to increase to 5 million barrels a day by 2025, we would be able to build a significant number of full-size reactors in Fort McMurray, regardless of in-situ production versus mining and upgrading issues.

Hydrogenation through Steam Reforming

For the discussion on bitumen upgrading, I asked the question how much hydrogen to we need for upgrading. I.e. what's the efficiency of steam reforming methane to produce hydrogen. After all, the heat required to break-up methane into synthesis gas doesn't need to come from burning methane, it could come from a nuclear plant.

To answer this question let's get introduced to the production of hydrogen through steam reforming. This is the standard process used for the production of industrial hydrogen. It involves reacting water and methane at high temperature (1100 oC), pressure (25 bar), in the presence of a metal catalyst (Nickel).

H2O + CH4 → CO + 3 H2

ΔH = +206 kJ

This forms synthesis gas: Carbon Monoxide and Hydrogen gas. The next step is to burn the Carbon Monoxide with water at 400 oC in the presence of a catalyst to get back more Hydrogen.

CO + H2O → CO2 + H2

ΔH = -41 kJ

The energy produced in the second stage can be recovered by preheating the first stage. For for a total enthalpy change of 165 kJ we get out 4 moles of Hydrogen, or 41.25 kJ/mol. This is rather better than electrolysis, which burns low entropy electricity at 286 kJ/mol to make Hydrogen. Coal can also be used in steam reforming, at 45 kJ/mol (but also twice more CO2 production). The Hydrogen and Carbon Dioxide can then be separated by a variety of means. I am going to assume that this is energy neutral, because the mixture should still be suitable for hydrogenation.

Hydrogen Production

Ideal Energy Input



Coal Reforming


Methane Reforming


Real-world electrolysis is about 75 % efficient. If we assume reforming has the same efficiency, then the actual energy requirements for hydrogen production through methane production, rounded up, 30 MJ/kg.

Methane has a heating value of 55.7 MJ/kg, so for upgrading bitumen, we'll need about 0.54 kg of methane for every kilogram of methane we convert to hydrogen. This works out to 35 % of the methane from our input stream being diverted to power the process.

I showed in my last post that about 0.3 mcf/bbl of natural gas was needed for tar sand separation and a maximum of 0.45 mcf/bbl used for upgrading bitumen to synthetic crude. If we could replace the 35 % of the upgrading energy with heat from nuclear, we could replace 60 % of the overall natural gas consumption with nuclear power (combined sand-separation and upgrading). The remaining 40 % of energy input would need to come from natural gas. If we drop the upgrading consumption down to 0.3 mcf/bbl, then the ratio rises to 67.5:32.5 so the natural gas reduction is almost proportional.

It's looking progressively worse for the deployment of nuclear steam power for tar sands development. I still need to look at the thermochemical processes that nuclear plants are capable of running for the production of hydrogen from thermal (rather than electrical) energy. Electrolysis is a loser, as always. The only other possible option is to create mobile nuclear steam plants for in-situ production, as Engineer-Poet stated. However, these probably wouldn't be able to make full use of cogenerated electricity, which is part of the whole economic argument.

One thing that is worth nothing is that the study numbers don't match Syncrude's actual natural gas consumption of 1.35 mcf/bbl. Syncrude isn't doing much in-situ production to my knowledge, so I don't know where most of this inefficiency is coming from. If it's all from the extraction and separation process, nuclear might look a little better.

18 September 2005

Bitumen Upgrading

As I previously talked about in my post on the use of nuclear steam generation for the Alberta tar sands, they require a large energy input in the form of steam in order to separate the heavy oil from the dirt. The heat for steam is currently almost exclusively generated by natural gas. There are two basic methods of extracting bitumen from tar sands: the surface layers can be open pit mined. Deeper layers can be separated in-situ, by pumping large quantities of steam underground and then extracting the warmed bitumen.

In either case, the bitumen needs to be upgraded (mostly through hydrogenation) . Typically this would be done by reforming -- splitting the hydrogen off methane and then transforming the bitumen into synthetic light crude. Syncrude is currently burning off 1.35 Mbtu of natural gas per barrel of light crude they produce. This raises a crucial question for the basis of nuclear steam: how much natural gas is needed for separation, and how much is used for upgrading?

The natural gas used for upgrading cannot be replaced by nuclear generated steam. Hydrogen could be produced from nuclear power, either thermally or through electrolysis, but this is prohibitively expensive compared to steam reforming. I was eventually able to find this link, which on page twelve states that mining consumes 0.25 - 0.30 MBtu of natural gas for extraction and 0.15 - 0.45 MBtu for upgrading. In-situ is far worse at 1.0 - 1.2 MBtu per bbl with the need for later upgrading:


The wide variation in the inputs for upgrading are a result of the wide variation in the quality of bitumen deposits. This sort of puts the damper on the idea of using nuclear for steam production. Nuclear steam isn't highly mobile, so it's not very useful for in-situ production, where major cost savings could be made. However, in the mining case it's clear that the separation is only about half of the natural gas inputs. It might be possible to use nuclear power to preheat a stream of methane used for reforming, but it probably won't make the nuclear steam plant significantly more economical.

The problem remains that the steam inputs from bitumen are quite small compared to the scale of a nuke plant. Even at five million barrels a day production from mining, only about 1.3 GJ of steam could be used per day. That's only about 55 MW of heat production which represents about a 25 MW electric output -- i.e. nothing. One lesson here is that nuclear plants produce massive quantities of waste heat that goes unused.

There is another possibility for upgrading to natural gas. Syngas, produced from gasified coal, consists of Carbon Monoxide and Hydrogen gas. The other option is simply to wait for the price of natural gas to rise above the cost of hydrogen generated by nuclear power. Neither is likely to significantly offset the natural gas consumption used to render tar sands into light sweet crude oil.

17 September 2005

Plug-in Drivetrain

When we talk about the plug-in hybrid, there's two potential means to get power to the wheels. The first is to have a hybrid transmission that couples mechanically to both a combustion engine and an electric motor. This is the type of drivetrain in use by current hybrids, such as the Toyata Prius:


The second option is to use the combustion engine merely as a generator for the storage system. In this case, 100 % of the power to the wheels is supplied by electric motors. The electric motor would be sized to be able to handle the current from the batteries and the generator at the same time in order to maximize acceleration.

The question is, which is better for the plug-in? There's no doubt for a regular hybrid -- where most of the power is delivered through the combustion engine -- that the mechanical transmission is more efficient in delivering power to the wheels. The reason is because electric generators are not very efficient. However, combustion engines also like to operate under an optimal load -- the constant accelerations of city driving lead to inefficiencies in the overall efficiency of a car. Of course, plug-in hybrids with only a very short all-electric range can also run the engine at more ideal rates, using the battery to makeup shortfalls.

Diesel generators can have efficiencies of 37 %, Lithium-ion batteries round-trip efficiencies of 90 %, and electric motors can easily break 95 % efficiency. This means an all-electric drivetrain hybrid could have a tank-to-wheel efficiency of 32 %. In reality performance will be worse due to transients from starting. The typical tank-to-wheel efficiency of a diesel is about 29 %, so they are definitely comparable. In contrast, conventional spark ignition engines have a tank-to-wheel efficiency of about 22 %. In the end, it probably comes down to complexity and weight, both of which contribute greatly to cost. The electric drivetrain is likely lighter than its hybrid continuously-variable cousin. Assuming the cost of permanent magnets doesn't skyrocket, it should be a more inexpensive solution in the future, even if it isn't today.

In the case of a plug-in hybrid that gets about 75 % of its energy requirements from electricity and 25 % from carbon fuels, we will probably see a transition in the hybrid industry from the coupled mechanical-electrical transmissions of today to pure electric drive. Some more information on vehicle technology can be found at the DoE's Energy Efficiency and Renewable Energy web page:


13 September 2005

Oil versus Electricity, part deux

I was going to talk about alternatives in freight transportation, but Mozilla crashed and ate my expose.

Instead, I'd just like to leave a brief note on the rising costs of carbon-fuels, compared to those from electricity. I've talked before about the potential of electricity to supplant oil as our energy currency of choice. The main issues are that oil is fungible (interchangeable) in time and space, while electricity is neither, and the cost. With the rise in the cost of crude oil and natural gas, we are getting close to passing the point where electricity becomes cheaper than carbon fuels.

I'm going to assume $65/bbl of crude oil, $11 / Mbtu for natural gas. We'll take electricity as best case, British Columbia at $50 / MWh, and worst case California at $150 / MWh. Coal is $35 / ton at 6150 kWh / ton.

The results:


Cost per unit (US$)

Cost (US$/GJ)



65 / bbl



Natural Gas

11 / Mbtu



Coal (IL)

35 / short ton



Electricity (BC)

50 / MWh



Electricity (CA)

150 / MWh



As we can see, the cost in pure energy terms for reservoir-hydro derived electricity and oil are getting awfully close. If we were to take into the cost of refining crude into gasoline or diesel, electricity would be cheaper. Let's also keep in mind that electricity is a much higher exergy source of energy than the three main carbon fuels. It can do more work per Joule.

Hydroelectric power is already cheaper than electricity from coal; the proof is in my electrical bill. It's cheaper for me to use inefficient baseboards than to burn natural gas for heating. Clearly US States that are dependant on natural gas for electricity are in for some serious pain. Even given a 60 % efficient combined-cycle gas thermal plant, it will cost them $17.40 / GJ to produce electricity, or a seriously nasty 6.2 cents/kWh. That's not accounting for amortization for the capital, transmission costs, or operating costs. Alternatives like wind and solar power look attractive in comparison.

06 September 2005

Bang for Your Buck: Solar Subsidies

New Mexico's Public Service Co. has just announced that they will buy electricity from small solar electricity operators (less than 10 kW) at a rate of $0.19 / kWh. Compared to German subsidies of about $0.45 / kWh (US funds), this seems fairly small.

But is it?

Let's bring RETScreen to the party, and compare identical installations in Stuttgart, Germany to Albuquerque, New Mexico. Both locations are pretty close to optimal at an installed slope of 30o -- i.e. a roof. The Albuquerque PV installation will receive 2290 kWh/ m2year while Stuttgart only gets 1300 kWh/m2year of insolation.

Looking at commercial solar panels, I'll pick the Kyocera KC-120 because it's in RETScreen's database and the list price of $4.05 / Wpeak is one of the lowest available. I'll buy sixteen panels total, to keep my costs around $10,000. That means I need a 1800 W inverter, which goes for about $1700. I'll assume that it's a Do It Yourself installation, and that wiring and mounts cost $50 / m2. My total capital cost then comes out to $10,214.

This installation will deliver 3566 kWh/year in Albuquerque, worth $680 / year. This compares to 2092 kWh/year in Stuttgart, worth $942 / year (depending on the exchange rate). So we can see it's still a no brainer to build in Germany and suck off the hind tit of the taxpayers there. The Stuttgart installation will actually make $13,336 over 25 years of operation. The New Mexico investor only makes about half that, $6,786. In both cases, I'm assuming stable cough electricity prices and subsidies. The rates of return in both cases are excellent if you can get a fixed-rate low interest loan.

I also want to know what the marginal cost of CO2 is for either location, through offsetting coal fired electricity production. The cost of the subsidy in New Mexico is $0.11/kWh versus something like $0.30/kWh in Germany. (Aside: electricity prices to consumers in Germany include extra taxes which pay for the subsidies. This makes it difficult to figure out the real price. I figure it's about 0.12 Euros/kWh.)

The general rule of thumb for coal is one kilogram of CO2 per kilowatt-hour. Our New Mexico solar panels then are offsetting 3.6 tons of CO2 annually versus only 2.1 tons in Germany. Hence PNM is paying a marginal cost of $115 / ton of CO2 versus $315 / ton by the German government. Since carbon credits are currently trading for only $35 / ton this doesn't represent a good investment by either government on that count. Still, for New Mexico, it compares with the marginal price of wind in Ireland, from one study I've seen.

02 September 2005

Cow Flatulence Kyoto Credits

Methane is a much more powerful greenhouse gas than carbon dioxide. According to Wikipedia, methane has 21x more warming potential than CO2. On the good side, Methane is relatively short-lived. Many human activities produce methane, dairy cattle and rubbish landfills among them. Should capturing methane from sources like landfills and cows, and flaring it, provide CO2 credits, given how bad ass methane is as a greenhouse gas? According to Kyoto, yes. In fact, according to the Wall Street Journal it's happening in some locations like Brazil. Kyoto specifically allows for other gases that are more potent greenhouse agents to be sold proportional as CO2 credits.

One ton of methane that is simply captured and flared will produce 2.75 tons of CO2. So then given the 21:1 ratio, we should expect to get 18.25 tons of CO2 credits for doing this. Given that one ton of CO2 is currently worth US$35 in the European Union, the value of flaring a ton of methane is US$640.

So, how much is a ton of methane worth if we capture and distribute it? I.e. how much more profit is there to be made by storing it rather than simply burning it. In North America, methane goes for more than $10.00 / MBtu. That works out to one cent per cubic foot, or US$4.88 / m3. At 0.101 MPa and 295 K methane has a density of 0.65524 kg/m3. So how much is methane worth? $7450 / ton, or an order of magnitude more than the Kyoto credit.

Obviously, much depends on the economics, but it would appear that there's much more value in capturing and selling the methane gas produced from various biological decomposition processes than simply flaring the gas off. The order of magnitude increase in price would hopefully offset the cost of purifying and storing the methane, although I don't really know. Unfortunately, few places in the world pay as much for natural gas as the USA and Canada. In South America, for example, the value of methane is comparable to the value derived in flaring it. That's probably why we see them simply burning it in Brazil for profit.

I used a program called ALLPROPS -- developed by researchers at the University of Idaho -- to find the density of methane at my given conditions. I would like to share it with my readers. It can normally be found here:


Unfortunately, the site is down. I do not feel comfortable posting a link to it since the program explicitly states not to redistribute it.

01 September 2005

Chuztpah Alert

This is a little off topic for me, but it relates to Hurricane Katrina and the need for lumber products to rebuild the affected areas. As reported by the Canadian Press, US housing advocates want lumber tariffs on Canadian software lumber dropped to decrease the price of homes. The debate on the legality of the tariffs under NAFTA is ongoing, with the NAFTA panels siding with Canada and the WTO with the USA. The US lumber lobby, who benefit from the tariffs under the Byrd anti-dumping legislation, disagrees with any drop of the tariffs:

A spokesman for the U.S. lumber lobby, meanwhile, said Canadian producers should be exempted from those punitive softwood duties - but only on free lumber donated to the rebuilding effort in Louisiana and Mississippi.

"If Canada wants to do the humanitarian aid and donate their lumber, there would be no duty on free lumber," Scott Shotwell, a spokesman for the protectionist Coalition for Fair Lumber Imports, said in an interview from Washington.

I'd just like to say, it's uncommonly generous of US lumber industries to agree not to tax donated lumber. They wouldn't want anyone to think that they are going to try to profiteer from the expected rise in lumber prices from the rebuilding efforts.