An editorial in yesterday’s Investor’s Business Daily considers this week’s introduction of a U.S.-Brazil deal on ethanol technology and production as a possible step away from our dependence on crude oil from Venezuela
Chavez’s hostile anti-American dictatorship grows worse as his oil earnings pile up. With the U.S. as his best customer, buying about a quarter, or 1.1 million barrels, of Venezuelan crude oil each day, the bitter coda is that every barrel we buy fuels his anti-U.S. actions.
These range from crazed speeches to colonial acquisitions like Bolivia to rogue-state alliances with Iran and Zimbabwe to menacing moves against neighbors like Dominica, Guyana and Colombia with $4 billion in weapons purchases.
High oil prices, low supply and his own expropriations of foreign oil partners in Venezuela only increase Chavez’s oil cash and clout. The U.S. has been largely helpless, because it has few alternatives to buying Venezuelan crude.
But a new deal announced with Brazil to pool ethanol technology and produce greater quantities of ethanol in both countries could help.
The ultimate aim of the ethanol deal is to create a commodity market. This could give every country in the region alternatives for energy buying. In turn, it will undercut Chavez’s monopoly and abusive influence.
Undersecretary of State Nicholas Burns, who flew to Brazil to iron out the deal, made no secret of that. “Energy has tended to distort the power of some of the states we find to be negative in the world - Venezuela, Iran,” said Burns, quoted in the Washington Post. “And so the more we can diversify our energy sources and depend less on oil, the better off we will be.”
According to Tony Snow during yesterday’s White House press gaggle, energy independence will be the main topic when President Bush swings through Brazil during his March visit to South America. It seems that this is a priority for the administration, and at least on the surface, the deal is right in line with our vision of a new energy future: Reducing our reliance on dictators like Chavez and creating new markets to serve our economic, energy and diplomatic needs.
But does replacing imported oil with imported ethanol really put us on the road to energy independence? Or does it only shift our reliance from one foreign fuel source to another? Let’s hear your thoughts.
This entry was posted on Friday, February 9th, 2007 at 1:33 pm and is filed under Alternative Energy Technology, International Environmental News, Oil and Gas, Politics/Government . You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
February 9th, 2007 at 4:08 pm
There is a difference between importing ethanol and oil. First oil is a diminishing resource most of which is in the hands of hostile nations. The more the resource gets depleted, the more valuable it becomes and the more control these nations have over our economy.
Ethanol, on the other hand, is an expanding and renewable resource. Any country with access to a sugar or starch crop can make it. Ethanol thus becomes a commodity like soybeans or wheat which is already traded among nations depending on the needs and crop yields of each nation. With the promising future of cellulosic ethanol there is even more opportunity for supply. Ethanol may never totally replace petroleum, but it will certainly reduce our dependence on it, perhaps to the extent that we can make oil more of a buyers market where we can have some leverage over the hostile nations we are buying from, or perhaps not buy from them at all.
February 10th, 2007 at 12:45 am
Listen, if we do not take control of our own needs we will always be subject to those who supply them. That’s whether they like us or not. This is about solidarity and independence, I thought that was where the U.S.A. started? Can we as a nation of pioneering, discovering,inovating, frontiering evangelists not take charge of our future in the 21st century? Come folks let’s do it. let’s start thinking again and doing something to take care of our selves. Let’s flush all the nonsense and make the bad guys of this world wish they were an American. I’m Done!!!!!!!!!
February 11th, 2007 at 2:22 am
Folks:
We need to break our oil addiction now… And the sad truth is that we have the technology today to break the addiction.
I suggest using a collection of different methods to address our enduring and emerging energy needs. Specifically:
1. Provide significant incentives, in the way of tax relief or release, to companies that can produce alternatives. (Results equals Rewards)
2. Increase research funding by 500% in the areas of energy collection & storage (batteries) and energy production (Algae/Ethanol/Clean Burning Coal/Hydrogen perhaps) using non-traditional methods.
3. Remove all energy subsidies and divert funding to wind and solar exploitation. I am generally against subsidies of any type but we must bring all elements of national power to include economic to mitigate.
4. 35 more nuclear power plants.
5. In transition from Middle-Eastern, Kenyan, Russian, and Venezuelan oil, facilitate oil exploration and exploitation domestically…an place on the fast track. Yes, this means ANWAR, coastal waters off of California, Florida and the Gulf of Mexico among other sites.
6. Make hybrid vehicles a 1/1 dollar tax write-off with minimum standard of 50/50 MPG. Spend 25K on a hybrid and get a 25K tax write-off. This does not mean free cars, but it does mean a mean savings of 28% for avg Joe-Six Pack. It could also mean a tremendous savings for business as they replace vehicle fleets. 2nd/3rd Order effects result in a boon for the financial market, platic & composite industry, high capacity battery storage industry, some in the auto market (Hybrid, PEVH). That said, organized labor will be decimated when/if they resist evolutionary pressures. In order for the big three to re-tool, capital that Ford, GM & Chrysler lack will have to come from concessions from labor. Labor will resist into extinction.
7. Elect politicians who support an aggressive timetable….5 years would be nice…in the spirit of Marshall or Manhattan. I am a red state guy but I am tremendously disappointed in the RNC, the former leadership in the House and Senate, and the President. We trusted them for 6 yrs and they got nothing done…especially on the energy front despite having power in all three branches of Govt. And now we are over-exposed to another 1974 scenario.
Disturbing is that we currently fund the very countries that actively pursue and pray for our demise. A reduction or elimination on our reliance of foreign oil will crush the very regimes that are hostile to Americans and our way of life. We don’t have to kill all of our enemies…we just have to drive them to their knees…financially.
Nick P
February 12th, 2007 at 3:57 pm
ABSOLUTELY NOTHING CAN BE DONE OVER NIGHT. I’M SURE THAT MOST AGREE, BUT IT’S TIME TO QUIT TALKING. I’M GETTING OLD, SO LET’S SOLVE THIS PROBLEM FOR OUR KIDS. ALMOST EVERY IDEA HAS SOME MERIT. THOSE OF YOU WITH THE MEANS OR INFLUENCE, PICK YOUR FAVORITE IDEA AND PUSH IT. FROM TURKEY GUTS TO COLD FUSION.
HERE’S AN IDEA, HOW ABOUT TUMBLE WEEDS FOR ETHANOL. ANY ONE GROWING UP ON A FARM KNOWS HOW FAST AND HOW GIGANTIC TUMBLE WEEDS CAN GROW IF THEY HAVE WATER, AND THEY BURN BLACK FROM THE OIL CONTENT. WITH WASTE WATER AND SOME ORGANIC WASTE, YOU COULD GROW THEM 20/30 FEET HIGH IN A SINGLE SEASON. HAS SOMEONE CHECKED IT OUT? NOW’S THE TIME. WITHOUT OUR PETRO DOLLARS, THE PUPPIT DICTATORS DRY UP AND BLOW AWAY.
February 12th, 2007 at 9:56 pm
Ethanol is a possibility for the reduction of our dependency on foreign oil, but Coal to Liquid (CTL)may offer a better solution.
CTL Technology
Can CTL technology be utilized today?
CTL fuel is readily useable today in existing transportation markets and can be delivered through existing pipelines. Auto and airplane engines are currently compatible with CTL fuels.
How many people can CTL plants employ? Where would they have to be located?
Each 10,000 barrel/day CTL plant can produce clean liquid fuels and support more than 2,000 jobs (direct and indirect) with coal from the many states with significant coal reserves and production.
Is CTL diesel any better for the environment than regular diesel?
CTL diesel fuel is cleaner than conventional diesel, with virtually zero emissions of criteria pollutants, hazardous air pollutants and mercury. It will rely on coal mined under the most comprehensive environmental laws in the world.
Won’t CTL production cause CO2 emissions anyway?
CTL technology is capable of capturing CO2 for use in enhanced oil and coal bed methane recovery, or for safe storage underground to reduce greenhouse gas emissions.
Is CTL technology really possible? Has anyone ever done it successfully?
CTL technology has been in use abroad since the 1940s, was perfected in South Africa in the 1980s, and is today being developed for industrial-scale production in China and by other major industrial competitors of the United States.
Won’t we have the same problem with coal supplies that we have with oil?
CTL projects will rely on the nation’s coal reserves — the world’s largest, at 27 percent of global supply. The U.S. is estimated to have 40 times the amount of energy stored in coal reserves than it has in its domestic oil reserves.
Why is domestic coal a better choice for the U.S. than domestic oil?
The U.S. boasts a near 250-year coal supply at current use levels, making coal our most plentiful domestic fuel. By contrast, the U.S. must import 60 percent of its oil consumption — a share projected by EIA to rise to 70 percent by 2025.
How can this technology strengthen our national security?
A feasible production goal of 300,000 barrels/day by 2015 equals the daily domestic needs of the U.S. armed forces.
How long would it take to construct a CTL plant? What is the cost?
CTL plants are costly to construct, about $1 billion dollars for a 10,000 barrel/day facility, and up to $6.5 billion or more for a world-scale 80,000 barrel/day plant with a five-seven year lead time.
Why do we need CTL technology incentives? How large should these incentives be?
CTL technology incentives should be weighed against the cost of further reliance on imported oil. The “hidden cost” of defending oil supplies in the Persian Gulf alone is conservatively estimated at $305 billion annually. Incentives backed by the federal government are needed to discourage the foreign energy cartel from destroying the domestic CTL industry through energy price manipulation.
Why is domestic coal a better idea than foreign energy?
U.S. coal reserves cannot be nationalized by a foreign government, require no costly armed forces to protect and need no costly exploration efforts to discover.
The National Mining Association is providing this Web site to further the public’s
understanding of the many benefits offered by coal-to-liquid technologies
February 16th, 2007 at 10:45 am
A far more immediate and aggressive response would be to cancel the importation of Venezuela oil. Or to those those who would object I say you can wait until Chavez, the fat pig, cuts the supply with a ‘decree’. You know that is coming don’t you? We need to educate America on how to cut consumption of energy by 15% as a starter. Cancel the importation of Venezuela crude immediately! Allow me to salute the terror free gas stations, Great idea!
February 16th, 2007 at 2:39 pm
Well, I have just read the six replys. They were all informative. Being a retired engineer three questions kept rattling around in my head as I read them.
1. It is my understanding ethanol is only about 75% as efficient as gasoline. This means that a car getting 30 mpg would get only 22.5 mpg with ethanol. This is quiet a cost disavantage for ethanol.
2. I wonder, how much ethanol can be mixed with gasoline before it starts herting gasioline efficiency?
3 Lastly, coal gasification. Will coal fuel equal gasoline efficiency 1 to 1?
February 17th, 2007 at 11:59 am
I would imagine that gasoline has a higher BTU than any type of SynGas. I haven’t been able to find any comparison charts yet. On Jan. 4, Kentucky Republican Jim Bunning introduced the “Coal-to-Liquid Fuel Promotion Act of 2007″.
March 2nd, 2007 at 4:29 pm
Allow me to introduce myself. My name is David Whitmer and I have worked as an engineer in the energy and environmental field for thirty years.
I am in complete agreement with the assertions of TerraRossa about the need for America to rid itself of dependence on foreign oil and that market forces are the way to make that happen. All that really needs to happen is to get government out of the way.
The US has had the technology to become more or less completely independent of petroleum for motors fuels for over half a century. Unfortunately I have to disagree about the viability of ethanol (actually denatured alcohol) as the preferred substitute. Regardless of the feedstock used ethanol will require a large portion of America’s crop land if we want to replace petroleum. Ethanol is not a particularly good substitute for gasoline, particularly in cold weather. Its low vapor pressure, low heating value, and affinity for water severely compromise its utility as a motor fuel.
What is my alternative? Coal-based synthetic fuel. The old Fischer-Tropsch process (invented 1923) produces high-quality middle distillate substitutes. The Third Reich and South Africa both used Fischer-Tropsch plants when their oil supply was curtailed. In the 1970s, an improved version called H-Coal was tried out in a DoE experiment at Catlettsburg, Kentucky. The process worked well but falling oil prices in the 1980s made the synthetic fuel noncompetitive.
While Fischer-Tropsch was originally designed for use of coal as a feedstock, it is interesting to note some work being done on coal gasification shows that other carbonaceous materials can be gasified – materials such as chicken litter, scrap tires, and sewage sludge. Gasification is the first step in the Fischer-Tropsch process. So the logical conclusion is that while coal may well predominate the synthetic fuel feedstock supply, it can be supplemented by other such materials. Making motor fuel of previously landfilled waste materials would be extremely satisfying to the average American.
Why has Fischer-Tropsch not been widely implemented in the U.S.? I can think of three reasons. First is the cost. Fischer-Tropsch is not competitive with oil at a price level below $45 per barrel. Oil is a very boom-and-bust business. Prices may be high today but they can fall sharply in a short period of time. To make synthetic fuel competitive, some means must be found to smooth out the wild price swings of petroleum.
Second, the embrace Fischer-Tropsch is to embrace the diesel engine. Fischer-Tropsch produces a fuel that approximates No. 1 (kerosene) or No.2 (diesel fuel) middle distillate. In fact the air force is testing out synthetic jet fuel in case of petroleum curtailment. The H-Coal process makes a refinery feedstock that can be made into gasoline in a conventional refinery. Middle distillate fuel does not run in a spark-ignition engine, but runs nicely in a compression-ignition (Diesel) engine. The U.S. public has been reluctant to buy diesel engines in their vehicles, citing noise, smoke, slow acceleration, and weight. Also all diesel-engined vehicles sold in the U.S. are sold at a steep price premium compared to gasoline engines. Diesel engines have been much refined in the last couple decades and the old “city bus” paradigm does not hold. Diesel engined vehicles typically deliver 25 to 50% better fuel economy than gasoline-engined versions.
The third impediment is environmental regulation. Unlike an ‘ethanol’ plant which is essentially a distillery with a methanol generator, the Fischer-Tropsch or H-Coal looks and acts much like an oil refinery. Thanks to the EPA’s New Source Review program (40 CFR 52.21) there have been no new refineries built in the U.S. since Jimmy Carter was President. Until this regulation is rationalized, no one in their right mind would invest the half-billion dollar investment in a Fischer-Tropsch plant.
I would invite TerraRossa to investigate synthetic fuels as an alternate solution to replacing petroleum.
March 22nd, 2007 at 10:31 am
[...] As a community of free-market conservatives, this is an idea we could really get behind. We blogged on this issue last month and got some interesting responses from readers, some of whom were concerned that the free market approach doesn’t always match up with out need for energy independence. [...]