This is a simplified version of the presentation I will be making this Tuesday morning at the ASPO 7 Conference (the full presentation should be posted on that website in a couple of days). I must admit that I have been a bit nonplussed to see that the peak oil community seems to share the oil industry's dismissal of wind power as irrelevant and useless in the face of the currently energy challenge (maybe I am unfairly judging from a few individuals' comments, but it's definitely an existing undercurrent in the community).

So, in reaction, let me put up here a few arguments that suggest that wind could play a major role in solving our current energy woes - not a silver bullet, but rather more than a side show.

First, the "wind is too small to make a difference" argument: well, so was nuclear, until it got big enough. Wind is following the exact same growth trajectory:

Pure Power
EWEA, March 2008 (pdf)

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And, as the image show before, wind power has already been a large part of energy investments for a number of years now, at least in Europe (but the rest of the world is now catching up, with the USA and China booming):

Pure Power
EWEA, March 2008 (pdf)

Over the past 8 years, wind has represented around 40% of new installed capacity (which, it is true, represents a smaller fraction a new production, in MWh, which is probably closer to 25%). In terms of investment amounts, wind has actually been the biggest business for the power generation manufaturers like GE or Siemens, given that a wind MW costs about double what a gas MW costs (prices per MWh are something else, given that you still need to buy the natural gas to burn to generate using a gas turbine...).

Wind will be a core instrument for the EU to fulfill its stated objectives of reducing carbon emissions and improving energy independence.

Penetration, 2005 & 2020
Implication of Large-Scale Wind Power in Northern Europe
Klaus Skytte, Econ Poyry, presentation to EWEC 2008

So it is simply false to say that wind is too small to matter. It is the biggest power generation industry by turnover in Europe, and it is on a fast growing trend that will quickly ensure that it becomes a significant part of the installed generation base. The industry reached the level of 100 GW ofinstalled capacity this year, as well as the threshhold of being able to produce 1 exajoule per year of useful energy. In fact, wind is reaching the stage where nuclear was when it was hit by the 1973 energy shock (which lowered demand and killed new investment) and the 1979 Three Mile Island accident (which turned the public against the industry) and is unlikely to hit the same snags:

Public opinion, despite persistent anti-wind lobbying by the coal or nuke industries and a few well-funded NIMBY associations, is massively behind wind power:

Harris Interactive

More importantly, wind has a major economic quality: the more there is, the lower electricity costs:

The effect of wind power on spot market prices (pdf)
Rune Moesgaard, Poul Erik Morthorst, presentation to EWEC 2008

Under market price setting mechanisms, wind power (which has a zero marginal cost) brings wholesale prices down when it is available, by avoiding the need for more expensive coal-fired or, more usually, gas-fired power plants that would otherwise be required to balance the system.

The effect of wind power on spot market prices (pdf)
Rune Moesgaard , Poul Erik Morthorst, presentation to EWEC 2008

The overall effect (price reduction multiplied by the relevant volume) now brings savings to consumers in Denmark that are equivalent to the gross cost of feed-in tariffs, and significantly higher than the net subsidy, as wholesale prices are now pretty close to, and increasingly often higher than, the feed-in tariffs guaranteed to wind power producers.

The same is already true in Germany, despite its somewhat lower wind penetration than in Denmark (11 (ed: wrongly used the number for Spain) 7% of electricity produced, vs 25%)

Assessment of the impact of renewable electricity generation on the German electricity sector (pdf)
Mario Ragwitz, Frank Sensfuss, Fraunhofer Institute, presentation to EWEC 2008
Note again that the cost noted above for the subsidy is the gross amount of the tariff, not the difference between the tariff and the wholesale price, which would be the correct amount of the subsidy granted to wind power producers

In other words, wind subsidies demonstrably save money for eletricity consumers, ie they are smart regulation.

An another interesting point to note is that wind power costs are now also well understood: industrial-size turbines now have a 15-year track record, and availability has been consistently in the 96-98% range, as shown by this meta study on 14,000 turbines:

Availability Trends Observed at Operating Wind Farms (pdf)
Keir Harman, Andrew Garrad, Garrad Hassan, presentation to EWEC 2008

And while offshore is slightly more expensive today than onshore wind, we're not about to run out of convenient spots at sea, away from whining onlookers, to continue the development of the industry:

photo by author
Thornton Bank, Belgium, August 2008

More stories about wind, and more discussion of other issues surrounding wind can be found on this page, of which I select a few noteworthy items:

the real cost of electricity
Alternative energies: wind power (an introduction)
My job (financing wind farms)
No technical limitation to wind power penetration (discussing the intermittency issue)
Why wind needs feed-in tariffs (and why it is not the enemy of nuclear)
Fierce price - yes it works! (first offshore wind farm to be financed is completed)
Gore sets goal of 100% carbon-free electricity by 2020 (how it can be done)

The conclusion is simple: wind power deserves to be taken seriously

On Tuesday the 23th of September, the deployment of the first commercial wave energy farm in the world started. A Pelamis unit was towed into the sea, connected to an underwater cable and moored to the sea floor, at a site were it will stay for the next 15 years. The Industry was present at the highest level, as so a Minister and even the Navy showed up with a frigate to join the celebration. But is it all roses? Below the fold are a few thoughts and calculations that show how this is truly a green energy source. Green as in immature, that is.

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The basics on Pelamis and the Aguçadoura I Project can be found here.

Celebration

Two and a half years behind schedule, after legal and technical delays and the sale of the main commercial company (Enersis) to Babcock & Brown, the first pelamis was finally permanently deployed. A high profile event was staged to signal the day, with the Minister of Economy (Manuel Pinho) and an entourage of CEOs and journalists embarking on the Portuguese Navy frigate Corte Real to follow the tug boat trailing the red serpent to its final resting place, 5 Km off the coast, by the village of Aguçadoura.

The pelamis units spent much of the last two years in the port of Peniche waiting for this day. After legal clearance the company struggled with technical difficulties, especially concerning the undersea cable that connects the mini-farm to the shore. The Pelamis engineers developed a floating plug that allows the connection to the cable without the help of divers. But unfortunately the system had been tested in shallow waters and failed in the deployment site, where a deeper water column exerted different hydrostatic pressure on the plug. Solving this issue alone took more than a year.

After a few rehearsals at sea and some tuning of the units for better adaptation to the site, the green light was given. The first serpent is in place with the next two being deployed these days, depending on the weather.

Manuel Pinho compared the event to the dawn of Wind Energy, that fifteen years turned is a story of success. He hoped that the same can be said about Wave Energy fifteen years from now:

The future of wave energy starts today.

Finland is very good in mobile phones, Portugal wants to be good in renewable energy. We are among the top five in the world, and we are just in the beginning of the process.

Renewable energy is the source of energy for the future and we think this can create an industrial revolution and a lot of opportunities for jobs and research and we want to be ahead of the curve.

The read serpent being put in place. Picture by João Abreu Miranda/EPA.

The Cluster

A new agreement was signed at the occasion with Pelamis Wave Power (the technological partner) having a 23% stake, Babcock & Brown 46.2%, EDP 15.4% and Efaced 15.4%. This new consortium will proceed with the Aguçadoura II project, that will be a larger scale farm, constituted by 25 pelamis units, summing up 18.75 MW of installed capacity. The press is quoting the project as costing up to 70 million €.

But these companies have longer term horizons; Leocádio Costa, Enersis' CEO:

What's programmed in the second phase is for 40% of the project being built nationally by Efacec, which is our largest producer of transformers, and with which makes all the sense he had talked to for the set up of a Cluster.

The Government providing us the licences, we are ready to go up to 500 MW in three or four different zones [along the Portuguese coast].

Alberto Barbosa, Efacec's CEO:

Through the years we will grow in Portugal and increase installed capacity, but afterwards we can proceed with that technological development at world level.

Portugal can be the Denmark of wave energy. The question is the political will to concede that installed capacity.

This Cluster in the prospects of these companies is an inception environment that would propitiate wave energy technology development, promote local component manufacturing and assembly, eventually creating an exporting industry. Talks are under way with steel transforming companies to join the project and new experiments with alternative wave technologies are being planned.

Pelamis Wave Energy will deploy the first water snakes (four in total) in their Scottish home shores next year off Orkney. Following that, seven are planned for deployment off the northern Cornwall in 2010. Other sites are being considered in Spain, France, Norway, North America and even South Africa.

Click to watch a movie summarizing the concepts behind Pelamis.

The Algebra

Now, let's go back to the black board and do a little algebra. Last time I showed some concerns towards this project given the money involved for such a small installed capacity (the three pelamis together don't sum up to a state of the art wind turbine). With the delays the project's costs are now reaching 9 million €.

Using a base load factor of 30%, the three pelamis of the Aguçadoura I project will generate in a year about 5.9 GWh (2.25 MW * 8760 h * 0.3). In my monthly electricity bill the kWh is rated at 0.12 € (that accounts also for grid maintenance and management, but let's take it at face value as an upper end estimate). Hence the yearly revenue of the project will be just under 700 thousand €. Or putting it another way, it will take 13 years for the break even, at best.

Each pelamis unit has an expected lifetime of 15 years. Considering that those 9 million € are not counting with maintenance costs, it is not a stretch to conclude that the financial return on investment (ROI) is close to 1:1. Where that leaves EROEI is not easy to envision, but it might not be that far off.

This could be a scalability problem, being the Aguçadoura I just a mini-farm, taking much of the burden of first time tuning to the site. But the press already has the figures for Aguçadoura II, 25 serpents (down from the announced 34 in 2006) and a 70 million € budget. This project will generated circa 49 GWh (18.75 MW * 8760 h * 0.3) of electricity per year resulting in a revenue of 5.8 million €. Break even arrives at 12 years of operation, again with best estimates for electricity prices and without maintenance costs.

The problem (as I stated in 2006) is that while a MW of installed Wind capacity costs about 0,4 million €, Pelamis is costing in the order of 4 million € per installed MW. There is a steep development curve ahead before competitiveness, more over taking in account that offshore Wind energy has a higher load factor (40%) and operates essentially during the same periods (waves are higher when the wind blows stronger).

Even if Pelamis manages to deal with low EROEI, this technology will likely stay in small market niches were Wind power doesn't reach, either be it due to visual impact, water depths or implantation difficulties. Looking long term this type of systems may be used to complement already in place Wind-farms using the space between windmills and taking advantage of the already existent electric connection to shore.

Is the future of the red serpent as clear as the sky? Picture by Catarina Pereira.

An Energy Policy Dilemma

With such prospects, why are these companies so eager to expand the project? The answer is simple, the state pays a feed-in-tarif of 0.23 € per kWh generated by renewable energy producers. This appears to be a good policy, guaranteeing a price for the electricity generated in the country, speeding up the phase out of fossil fuels, that are imported in their entirety. In that way a favourable environment is created for new energy sources to grow and develop.

But there's a huge downside to it: this subsidy is masking the low EROEI of some of these new energy sources, that otherwise should be preventing ill fated projects from surviving in the market. As seen from the Pelamis example, while the Aguçadoura I is an interesting development project from which architects and engineers will learn and improve, the Aguçadoura II does not represent any visibly evolution in technology, presenting essentially the same EROEI. Still it will be a profitable business for the companies involved, at the cost of the Executive Budget, representing a tangible money transfer from tax payers to private business, some even held by foreign capital.

This dilemma faced today by the Portuguese government will be one of the most important issues energy policy makers worldwide will have to deal in the transition away from fossil fuels: how to draw a line between those new energy sources that are really helpful for society and those that are not. Correctly measuring EROEI and determining how it evolves along the development phase of new technologies will have a crucial role in the Energy Policy of the XXI century.

I hope that this Cluster idea really turn out to be a success, and that development allows for Wave energy to became a useful part in our future energy mix. And not only for the sake of the country's industry but also for the negative social effects that the failure of the policies supporting it may bring.

The elements gathered here are based on the following news services:

BBC
RTP (Portuguese)
Jornal de Notícias (Portuguese)
Público (Portuguese)
CleanTech

Previously at TheOilDrum:

Tapping The Source: The Power Of The Oceans
Pelamis: A Shot in the Dark?

Luís de Sousa
TheOilDrum : Europe

This is a guest post by Sterling Smith (TOD user Sterling). This first installment of the series outlines the evolution of the energy panorama from now to 2050. A second installment will deal with technical and political aspects of the path put forward.

Sterling is a software architect who works in Silicon Valley and lives in Woodside, California. He was born in the suburbs of New York City and graduated from Dartmouth College, where he majored in physics. He has worked in the software business for 35 years, still writes code, and has been part of eleven start-ups as well as several major corporations. Sterling's wife, Deborah Metzger, PhD, MD, is a very prominent gynecologist with whom he is raising four kids.

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Overview

While many people who are just beginning to learn about peak oil do not yet grasp how serious it will be for society, many of those who do understand the threat are perhaps overly pessimistic of the world’s chances for shifting to a new energy base and even of maintaining civilization. Much of this debate revolves around the desirability of trying to preserve modern civilization and its apparent reliance on physical growth, but many also doubt that there are any energy alternatives to oil and the other fossil fuels that could possibly ramp up to address the looming need. I think we need to decouple these two issues and debate them separately. This article does not attempt to answer the question of whether civilization is worth saving. I think we need to answer that question “can we preserve modern civilization” before we try to take on the question of “should we do so”? The objective of this and a future piece is to derive and present a vision of a world that preserves modern civilization after it can no longer rely on fossil fuels as its primary sources of energy, with the assumption, supported in the second piece, that energy sources exist to support this outcome.

The world may follow any of several paths but the single one presented here seems to me the most likely. The first step will be to project the overall economic path that the world is likely to take as it struggles through the coming peaks of fossil fuels and replaces them with an alternative infrastructure. In step two, I will attempt to derive the total energy that would be required to support this projected economic activity. The third step will be to determine the energy mix that could support this energy demand. A future article will attempt to describe how we get there from here and what the new energy system would look like.

My reading of the evidence convinces me that the world possesses adequate energy resource to power a civilization like ours into the indefinite future. However, for this to happen, we will have to transition to a radically different energy infrastructure in the years to 2050. Can the world survive this transition? My faith in the ingenuity, persistence and will to survive of mankind says yes but I am not prepared to defend that at this time.

The Size of the World Economy in 2050

Assumptions:

• Energy resources exist that could power a civilization like ours forty years from now.
• The long term growth rate will approximate the current rate after a new energy infrastructure is built.
• The world will not be able to avoid a severe downturn, due to peaking, lasting about 20 years.
• Concerted societal action will mitigate the downturn.
• Total world population growth will end by 2050.
• The world economic activity mix will shift toward less energy intensive activities.
• Growth in traditional economic activities will slow.

My starting assumption is that the rate of economic growth in the next forty years, if unconstrained by declining energy, would likely be about what it has been for the last fifty years, which is 3.9% (World Economic Growth - Earth Policy Institute). However, since the current population growth rate is about 1% (1.167% - 2007 est.) and population growth is expected to go to zero by 2050, I reduce the expected growth rate without an energy shock to 3% in 2050. The rapidly developing countries such as China and India have had more than twice this growth rate in recent years but many critical resource are becoming constrained. These physical resource limitations are likely to slow physical economic activity but the economic mix is trending towards more creation of intellectual capital (entertainment, knowledge, communications, software, etc.) through activities that are placing much lower demands on physical resources. It should be possible to maintain this 3% level of aggregate economic activity growth while dramatically reducing physical resource consumption. I think it is fair to conclude that this level of economic growth in 2050 would maintain the current level of economic vitality.

_{Figure 1. Gross World Product, 1950-2005}

The next task is to estimate the impact of fossil fuels peaking on economic activity. Three potential scenarios come to my mind as possible with a fourth thrown in since it seems to be popular.

Collapse – In this scenario, once the crisis of peaking hits, it is never successfully mitigated. Economic activity turns down and continues down to a low level. Since there are potential mitigations, this might happen is if the shock causes the economic system to break down so that a coordinated response is not possible. This scenario would undoubtedly be accompanied by wars, tremendous environmental destruction and a huge die-off.

No Growth – For some reason that I cannot fathom, zero economic growth seems to have great appeal to some. This scenario seems completely implausible to me. We will either make the transition to a new energy base or we will not.

Profound Oil Shock – In this scenario, economic growth slows down as shortage of oil, principally, puts people out of work. Eventually, substitutions emerge and economic growth resumes. The net effect is the time at with the economy reaches a certain level is delayed for some years.

World War Mobilization – This scenario would occur if the world mobilized to take concerted action to mitigate the problem as quickly as possible by focusing world resources narrowly. It seems more likely to happen after a more rapid deterioration. Growth could be significantly above trend for the entire world for up to ten years. A third World War might not include as much wholesale killing as the first two. It might just be an intense economic competition with dramatic winners and losers. The rapid wealth transfers now occurring are setting the conditions for this kind of event.

_{Figure 2. Four Responses to Peaking}

While the world war level mobilization seems to me almost as likely as a profound oil shock, I am going to arbitrarily choose the oil shock perturbation as the basis for my model. The question is, what is a plausible depth and duration for the downturn? The Hirsh Report predicts that it will take twenty years to fully mitigate the effects of oil peaking. It also notes that economic upheaval is not inevitable (“given enough lead-time, the problems are soluble with existing technologies.”) During the Great Depression in the US, the economy lost 25% of its value in 1930-1933, but was back to its previous high by the beginning of 1937. My guess for the coming downturn is that it will be similar in magnitude to the 1930s depression but that it will be shallower and last longer. With this in mind, my model estimates that the world will lose about 70% the economic growth that it would have otherwise had during the twenty year mitigation process starting in 2010 (23 vs 78 T$). This is a very severe downturn but I am simply making guess here how severe it will be.

The only somewhat similar historical precedent for such a downturn happened after the 1979 oil shock, prompted by the Iranian revolution and the subsequent Iran – Iraq War, when the price of oil rose two and a half fold and stayed at about twice the previous level for about six years before collapsing in 1986. This event involved a temporary reduction on consumption of about 15% which created a noticeable blip in world economic growth (see figure 1) but no overall downturn. This was a much smaller event than the 2010-2030 downturn assumed here. It is interesting to note that this event was mitigated not only by the rapid increase in oil supply in many countries but also by the world’s first nuclear power buildup.

_{Figure 3. Projected Gross World Product to 2050}

Energy Demand

Assumptions:

• Economic activity and energy consumption are directly related.
• Energy supply constraints produce greater energy efficiency.
• Greater energy supply leads to lesser energy efficiency.
• Emerging knowledge intensive activities will use proportionally lower energy.

It is widely believed that there is a direct relationship between a level of economic activity and the amount of energy that must be consumed to produce it (see works by Robert Ayres and Charles Hall). However, I expect three major trends which will slow the growth of energy demand. The first is the already stated expectation that world population growth will go to zero by 2050 which will lower long term economic demand growth to 3%. The second is that energy efficiency will improve for the current mix of economic activity, which will itself decline by one third due to resource constraints. However, these efficiency improvements will be largely given up once the supply of new energy resources increases. In my model, the current mix of economic activity improves to 70% of the current energy consumption per unit of GPD in 2020 (i.e. these activities are 30% more efficient), but then reverts to 90% by 2050 once the supply of energy has rebounded. I believe the world will add an additional approximately 1% of growth per year (of 3% total growth) of low physical resource activities which characterize the information society. These are modeled at half as energy intensive as the current mix and grow to 33% of the total mix by 2050. Together these would provide 3% economic growth with 75% of the current energy demand per unit of economic activity in 2050. The current world energy demand is about 15 TW per year (World energy resources and consumption).

_{Figure 4. Projected World Energy Demand}

The question has been raised if it is plausible that energy efficiency could improve 30% by 2020? For the purposes of my model, I am mainly concerned with deriving the demand in 2050 so the efficiency in 2020 does not matter except for the light it might shed on the plausibility on the depth of the downturn. To me a 30% improvement in 12 years does seem plausible in a severe crisis.

Energy Mix

Assumptions:

• Oil will peak by 2012 , coal by 2024 and natural gas by 2029.
• The amount of electricity that can be generated by nuclear, wind and solar is not effectively limited by the amount of available fuel.
• No new energy source will be significant between now and 2050.
• Production volumes of fuels from low grade hydrocarbons will never rival today’s production of traditional fossil fuels.
• It will be important to leave a significant amount of coal in the ground to lessen global warming.
• It will be necessary to slow the consumption of remaining oil and gas below the projected natural decline to save some for future generations.
• A future electricity grid will be designed around the principal of power on demand
  Transportation will shift to an electricity base from an oil base.

The next question is how to provide for the energy demand with the resources that are likely to be available. Fossil fuels are all projected to peak in this period. It is probably not possible, in the short to mid term, to ask people to reduce their use of oil and gas more than they will have to due to peaking, since there are not good immediate substitutions. However, if possible, it would be better to slow the consumption of these so that we do not exhaust the last supplies of these as soon as projections now suggest we will. Coal is another matter. It is the dirtiest of fossil fuels and it can be displaced directly for electricity generation by sources that I do not expect to be in short supply. Due to the seriousness of global warming, my model phases coal out for electricity generation by 2050. It will presumably still be used in 2050 for transportation fuel, especially for aviation and for such uses as steel production.

Dave Rutledge of CalTech, who has done some of the best work on the peaking of coal supplies, has estimated that even if all fossil fuels are consumed as quickly as they can be produced, that carbon dioxide levels will peak at only 460 ppm, a level that most climate scientist recognize as at just the threshold of doing serious damage to the climate. Does this mean that fossil fuel depletion will solve the global warming problem and that we do not need to do anything about it? I do not think so. James Hansen, NASA's top climate expert, thinks that this threshold needs to be 385 ppm, below the current level, and we are already seeing serious negative effects. Even once emissions decline significantly due to peaking production, it will take several hundreds of years for the carbon dioxide levels to come down to acceptable levels.

My model will use these data compiled by Luis de Sousa for his Olduvai revisited 2008 article (thank you Luis) which has oil peaking in 2012, coal in 2024 and gas in 2029 (1 TW = .086 Mtoe):

_{Figure 5. Conventional Fossil Fuels}

In the following three graphs I show how each of the three fossil fuels is expected to decline due to peaking and also provided recommended levels of consumption, shown as dashed lines below the solid lines of the same color. I assume that coal will be phased out in the model by 2050, except for expected non electricity generation purposes, due to its severe impact on global warming. For oil and natural gas, I cut back the consumption of each on the assumption that these will become too value for us to consume them as fast as we can. I am convinced that this will only be possible once we have alternative sources rapidly coming on line. All data are converted to tera watts.

_{Figure 6. Projected and Recommended Oil Supply}

_{Figure 7. Projected and Recommended Coal Supply}

_{Figure 8. Projected and Recommended Natural Gas Supply}

As you can see, I am projecting that by 2050 we will be able to rely on fossil fuels for only 5.5 TW of my expected world demand of 31.7 TW or 17.3%. I believe this total includes essentially all likely production from alternative fossil fuel source such as oil sands, oil shale and bio fuels which are essentially repackaged fossil fuels. None of these sources seem to be capable of producing much net energy and/or to be producible at high rates. I expect that Biomass, hydro and all other sources (excepting nuclear, wind and solar) will provide about 1 TW combined, as they do today bringing the conventional total to just over 20% of my predicted demand. (I do anticipate the there might be a very large increase in hydro to deal with the wind and solar intermittency issue.) Here is a view of the current world energy mix (World energy resources and consumption):

_{Figure 9. Current World Energy Mix (Click to enlarge)}

Wind and Solar will play vital roles in the future. However, they will have to operate within a power on demand grid. People will not stand for not being able to get on the Internet at night or use air conditioning during the day because the sun is not shining or the wind is not blowing. Today, all wind and solar has to be redundantly backed by dispatchable sources such as gas or hydro to cover for their intermittency. A max of 20% for these sources is widely accepted as the upper bound of their usefulness without a method of large scale power storage or other way to cover for their intermittency. This situation will be made worse in 2050 by gas becoming too precious for power generation. The only large scale storage method of power storage that has emerged to date is pumped water storage. Stuart Staniford and others have proposed a world wide super grid as a way allow solar to be used where the sun is not shining. Al Gore has also recently described a large scale electrical grid as a way to allow wind power to provide a very high percentage of electrical power. To give these vital sources the benefit of the doubt, my model will allow 30% wind and solar with one third of it assumed to be backed by some storage method or grid yet to be determined. I do not think that the proponents of these approaches have demonstrated that they could reach the high levels of renewables they advocate, preserving the power on demand nature of the system and competing on cost with alternatives likely to be available at the time. Note that my model does not adequately provide for the dispatchable power sources that would be necessary to provide the redundancy for the level of wind and solar projected.

My model assumes that 80% of the energy that the world will require in 2050 will have to come from nuclear, wind and solar, or 25.4 TW of electricity. At least the current amount of gas used for electricity generation and all the hydro totaling another roughly 1.5 TW will also be part of the total for an electricity total of 26.9 TW. Of this 30% could come from wind and solar together adding up to 8.07 TW which is 158 time the current .051 TW from these sources. Note that the level of wind and solar projected would only be possible in a mix with nuclear baseload or if the power on demand characteristic of the current system were abandoned. In the latter case, the grid would be completely dominated by the intermittent characteristics of wind and solar.

_{Figure 10. 2050 World Energy Projected Production Without Nuclear}

The next chart shows the dilemma of what would be possible without nuclear power or some other energy source not here considered. Again, remember that this scenario would also feature an electric grid that would only provide power on intermittent supply.

_{Figure 11. Production vs Demand without Nuclear}

I am not sure how to explain the gap in 2010-2030 between the energy projected to be available and the demand projection of the model. One interpretation is that the crisis will be primarily a shortage of oil and that coal and gas cannot immediately substitute. Demand goes down because the oil shortage depresses economic activity and enforces conservation. This article does not pretend to understand what happens during that period, how we would muddle or suffer through it. The important point here is to look at the end state: what is the size of the world economy in 2050? Perhaps the downturn does not have to be a severe as I am forecasting it to be. Tom Whipple, former CIA analyst and top peak oil reporter, has a recent article the comments on the coming crisis. He concludes:

It is getting very complicated out there, and none of us really know what is going to happen.

The Solution

This article assumes that the world has sources of energy in nuclear, wind and solar that are not supply limited and it has the will and the means to transition to a new energy base after fossil fuels are no longer available. In my view, the only credible way to do this is with a large nuclear, wind and solar buildup. In my model nuclear increases 19 fold and wind and solar increase 158 fold.

Energy Mix in 2050 (Tera Watts)
Oil	1.0	3%
Coal	1.5	5%
Natural Gas	3.0	9%
Wind & Solar	8.1	25%
Nuclear	17.0	54%
Other	1.1	3%
Total	31.7

My goal is to write a future article which describes what this world would look like and how we would get there. My hope would be to write that article with the collaboration of several Oil Drum posters who know more about the details of this issue than I do. It is obviously controversial to put forth a vision that assumes that the world can resume the kind of growth it has seen in the last 50 years after fossil fuels are largely depleted and especially to base the vision heavily on nuclear power. Regarding nuclear, I cannot think of a topic where so many contradictory views are debated so often without a consensus emerging. For example, many people still think that nuclear has a low energy return and that supply of fuels are nearly running out, views that I think are strongly at odds with the evidence.

Is this vision hopelessly naïve and cornucopian? Only if you assume that there no way to go but down for mankind.

Spreadsheet with calculations and graphs.

This is me in front of the windfarm which I helped finance two years ago. It's up and running, and will be generating clean energy for the next 20-25 years - at a price guaranteed not to increase for the whole period. It was inaugurated yesterday and christened Princess Amalia windfarm, after the young daughter of the Dutch crown prince.

All my wind diaries are now listed in this Windpower index story.

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Now that European wholesale power prices are becoming higher than the feed-in tariff paid to wind farms in most countries that have them (ie it's getting cheaper to buy "subsidized" wind power than regular, "competitive" power on the free market), it's particularly sweet.

French day-ahead electricity prices on Powernext (free reg. required).
The regulated tariff for wind power is 82 EUR/MWh or lower.

Of course, the costs (and the tariffs) for offshore wind are still slightly higher than for onshore, but this is likely to change quickly as the sector moves away from semi-experimental construction procedures to standardised methods, and as the current bottlenecks in the supply chain recede as more production capacity is put in place.

The fact remains: onshore wind costs 40-70 EUR/MWh and offshore wind power costs 90-120 EUR/MWh today and both will cost that, or less, in 15 years' time. Can any other electricity source say that, except for hydro (which cannot increase its production capacity) or solar (which needs a few more years of development to see its still high costs - 250-350 EUR/MWh - come down to more attractive levels)?

Wind's only obstacle today is the still widespread perception that it is not a "serious" energy source, that it's only a small part of the solution, and that it's not really reliable anyway.

It was heartening to see earlier this week this ad in all French newspapers, whereby all the big French utilities (including almost-all-nuclear EDF) publicly supported wind power and insisted they would continue to invest in the sector:

(It was somewhat less heartening to see Poweo's Beigbeder's self-serving and bad faith ode to competition in today's Le Monde - I will respond separately to that article).

But as power generation manufacturers like GE, Siemens and others get a increasingly large share of their turnover from selling wind turbines, as Vestas (the leading wind turbine manufacturer) sees its market capitalisation reach EUR 15-20 billion, as foundries, steel makers, gearbox manufacturers, shipping companies and others see massively increasing orders coming their way from the wind industry, and as local farmers and public officials realize that they can get extra income, and extra local jobs, maybe the tide of "seriousness" will turn readily enough.

And as wind capacity installed each year continues to increase by 20% or more each year worldwide, its share of world production will quickly reach undismissable levels. This year, a number of symbolic threshholds were reached - 100GW of installed capacity, one exajoule of annual electricity generation, 40% of electricity produced from wind in Spain on some days. All of this, essentially starting from scratch less than 10 years ago. what will another 10 years bring us?

Massive unreliability, as we need to wait for wind to blow to turn on our computers or our air conditioning? Or simply new ways to run the grid, as the experience of Denmark (which has enjoyed a number of days when more than 100% of its electricity needs was produced by wind) or Spain shows? The French grid operator, RTE, long extremely wary of wind power and its unreliability, had this to say in its latest annual report (big PDF, in French, see p.49):

The second point is about wind's contribution to peak demand: despite wind's intermittency, wind farms reduce the need in thermal power plants to ensure the requisite level of supply security. One can speak of substituted capacity.

The capacity substitution rate (ratio of thermal capacity replaced to installed wind capacity) is close to the average capacity factor of wind farms in winter (around 30%) for a small proportion of wind in the system (a few GW). It goes down as that proportion increases, but remains above 20% with around 15GW of wind power.

Intermittency is a real issue, but it is one that can be dealt with at what, so far, appears to be an extremely low cost - investment in the grid, something that's useful in any case if we want resilient systems.

Ah, but wind farms are ugly!

This is a guest post by Dr. Thomas Hinderling. Dr. Hinderling is the CEO of CSEM Centre Suisse d'Electronique et de Microtechnique SA. One of CSEM's most exciting projects concerns the design of a new class of large scale concentrating solar power systems, called Solar Islands ¹. This article introduces the solar island design to the readers of TOD ².
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Introduction – the Problem

During the next decades, the generation of sustainable energy will become one of the main challenges of our civilization. Worldwide energy demand is expected to grow from about 10 GTep (10¹⁰ Tep [Ton Equivalent Petrol], or 5*10¹⁹ Joule) in the beginning of the century to 15-20 GTep by 2050. Some scenarios predict even levels as high as 40 GTep. An analysis of future global petrochemical consumption needs (i.e. energy needs and/or raw material for chemical industry) implies that early petrol shortages might already appear in the mid of the century.

The need for large scale renewable energy sources is underlined by the global warming due to increasing CO₂ levels. CO₂ is an unavoidable by-product of the energy generation process using any kind of fossil fuel.

Or, in simple terms: Not only are we running out of petrol, but the combustion of petrol causes major environmental problems. However, worldwide deployment of renewable energy in very significant quantities constitutes a huge effort of political and financial nature; incredible amounts of invested energy infrastructures are involved. In view of this, the start of this evolution is becoming even more urgent, already today.

While these facts start to be more and more accepted, there is still no global solution for renewable energy sources available. Such a solution should provide usable energy in very large quantities and at competitive costs, i.e. competitive in regard to today's energy prices. Current solar solutions are either not sufficiently scalable (they are only of regional nature), or they are too costly. In most cases, their underlying business model is based on massive public subsidies (which clearly is impossible at large scale deployment), or on massively increased energy prices (at least five times as high as today ³) which would simply disrupt the world economy.

Renewable Energy Sources

Among the many renewable energy sources, the potential of solar energy is at least one hundred times larger than any other renewable energy source (see figure 1).


Fig 1: Yearly global energy for different energy sources (logarithmic horizontal scale, source: Commissariat à l´Énergie Atomique, CEA, France)

Moreover, it can be shown that direct solar irradiation is the only source of energy that can satisfy the global long term energy demand – all other sources of energy are either too insignificant compared to the worldwide energy need (wind, CRW [combustible renewables and waste], tidal energy) or they are too costly (geothermal). Wind, CRW, tidal energy or geothermal energy can all be very interesting on a regional and local base, but they can by far not supply the necessary Gigateps of energy to satisfy the global demand. They have to be considered as auxiliary energy solutions.

Even nuclear fusion energy (should it become available soon, which is unlikely) cannot provide a global solution. Thousands of fusion plants would be needed in order to supply a significant amount of global energy; the ensuing technological and political complexity would be far too high.

Any solution for a future global energy supply must base on direct solar energy conversion at large quantities. Again, this does not mean that other forms of energy could not be interesting, but it means that a global solution can only be focusing on solar irradiation as the main supply of electric and combustible energy.

Classes of Solar Energy Converters

Today, there are four main classes of solar energy systems in operation or in development (aside from many other ideas in test):

1. Photovoltaic panels:
   Using the principles of photovoltaic conversion, solar light can directly be converted into electricity. This principle is extremely attractive, as the conversion into usable forms of energy is very simple; using little electronics, the output of solar PV panels can directly be fed into the electric grid. The problem with this solution is that the costs of such PV panels are still quite high, and the efficiency of the energy conversion is quite low (between 5 and 15%). Even though there is high hope that the costs will come down and that the efficiency will go up, PV solutions are based on semiconductor surface layers which are inherently expensive. It is doubtful that this technology will provide large scale solutions at sufficiently low costs. Another big and unsolved problem of photovoltaic solutions is the storage of the energy – a must for supply continuity over 24 hours a day. Future solar energy must be bulk energy, available according to daily fluctuating demands, not according to the position of the sun in the sky or the weather! Solar energy at large quantities implies the necessity for energy storage.
    

2. Low temperature solar panels (collectors):
   These panels use the direct irradiation of the sun to heat water. Temperatures of up to 100^oC can be reached. This type of panel is highly efficient (heat is converted into heat). The heated water is relatively easily storable, even at large quantities. These panels are therefore ideal to generate a supply of warm water for domestic and industrial use. However, due to their low temperature, the conversion of the heat energy into other forms of energy (mechanical or electric energy) is very inefficient (see Annex 1).
    

3. Thermo-solar high temperature panels and systems (100-350^oC):
   These systems, also called CSP systems (for "Concentrated Solar Power") collect heat energy from the sun (mainly visible and infrared irradiation), typically to generate saturated (but not super heated) vapor at high temperature (up to 350^oC) and high pressure (up to 60 bars). The high temperatures are needed to increase the efficiency of the energy conversion from heat to usable electric energy. To get to these higher temperatures, the solar radiation needs to be concentrated, so that the surface-specific irradiation is corresponding not only to one sun, but to "many suns". Various examples of such concentrators have been developed, but there are two main types:
    
   • Trough-shaped concentrators: The sun is focused to a centrally disposed tube, in which a liquid circulates that can absorb heat. Heat absorbents are typically water or mineral oils.
      
     
     
     Fig 2: Trough Concentrator
      
     
   • Extra Flat Concentrators: The same principle can be arranged in a lower cost arrangement, as in the following figures:
      
     
     
      

     
     Fig 3a and 3b: EFC (Extra-Flat Concentrator)
      
     

4. Thermo-solar very high temperature panels and systems (>1000^oC):
   There are many examples of very high temperature solar concentrators. The high temperature allows for a very efficient energy conversion, but current solutions are still by far too expensive. It is hard to understand that they ever could become cost competitive.

Cost Considerations

The costs of a solar solution for very high energy quantities need to be similar to today's energy costs, or at least not much higher, as this would have a very negative impact to the world economy.

To estimate the maximal costs that could be accepted in a competitive market environment, we have to start by considering the solar irradiation which is defining the potential revenues. Near the equator it is in the order of 1 kW (kilowatt) per square meter at noon and clear sky. This corresponds to an irradiated mean power of ~250 W (as a mean over 24 hours, i.e. day and night) , equivalent to an irradiated energy of 6 kWh (kilowatt-hours) per day and per square meter. The efficiency of the conversion from solar energy to usable energy (delivered at user's site) is around 10%. In an optimal case (365 days of sunshine, latitudes 0-20^o), this mean solar power corresponds to a converted energy of 220 kWh per year and per square meter. At a price of crude oil of around 0.07 US$ per kWh (if converted to equivalent electric energy), this translates to revenues of ~14 US$ per square meter and year. Assuming that 10% of the costs per square meter are used for financing costs and amortization (amortization time of 20 years) and that 10% are used for operational costs, the investment becomes profitable if the costs per square meter are below 70 US$ per square meter (see detailed calculation below).

All current solar solutions are at least 5 times, most often rather 10 times more costly than that. Therefore, new ways and new solutions are needed to provide solar energy at truly competitive costs, so that it becomes a commercially interesting issue, not just an idealistic dream.

It is unlikely that PV panels would ever be available at costs below 200 US$ per square meter (see figure 4). This is mainly due to the fact that the material of the PV panels (semiconductor material) is process- and energy intensive. Also, the advantage of PV solutions at small and medium scale turns into a disadvantage at very large scale. The wiring, power conversion and cleaning would be difficult, and, most of all, the storage of energy is difficult, too.


Fig 4: Photovoltaic module costs of various producers (US$ / square meter, without electronics!)

CSP systems are just the opposite: They are very expensive at small scale (the conversion of vapor to electricity is complex), but they are an excellent solution at very large scale. The reason is simply that at very large scale the active panel area becomes the main cost driver, while the auxiliary systems are much less important.

The conclusion is obvious: High temperature thermo solar panels (=CSP) are clearly the lowest-cost solution at very large scale, while PV systems are the best choice for small systems.

A New Solution

EFC (extra flat concentrators) panels, as described in figure 3, are already offering system solutions which are considerably less expensive than all other solutions. But they still suffer from two disadvantages which render them too costly. Firstly, as they need to follow the sun in its path across the sky, they have to make use of a precise and costly tracking mechanism. Secondly, they offer a large resistance to wind. They either have to be built very ruggedly (expensive), or they lose dramatically in efficiency (wind movement meaning de-focusing, therefore loss of efficiency). It does not seem to be possible at first glance to construct a panel which focuses horizontally, instead of vertically (i.e. turning left-right, instead of up-down), as the panels have to be linked to high pressure vapor lines that go from panel to panel:


Fig 5: Schematics of a line of solar panels with connecting high pressure tube

As the figure shows, it is not possible to turn the panels in this line individually; they can only be turned as a whole. This is where the idea of Solar Islands comes in: If one could put all panels on a very large platform and then turn the platform as a whole, the panels could be fixed horizontally on the platform (offering almost no wind resistance) and be focused by turning the whole platform, thus providing a very cost-efficient solution.

Floating Platforms

Based on the ideas of the author, CSEM has designed a very simple way to provide such a solution, i.e. a very large platform which can be turned as a whole. As the weight per square-meter by the loading of the solar panels is extremely regular (for instance, one panel every 10 meters), we can make use of a very simple principle: A large low-cost surface sheet (typically a plastic sheet) is fixed to a frame in an airtight manner. An over-pressure is applied below the membrane, thus exerting a vertical force. The amount of the over-pressure can be adapted to the specific weight per square meter. In this way, very considerable weights can be easily lifted (without lateral forces!). One tenth of an atmosphere of overpressure exerts a force equivalent to 100 g per square centimeter. This corresponds to 1 ton per square meter already! Therefore, it is easily possible to exert a sufficiently high overpressure to lift the membrane with the panels fixed on top of it.


Fig 6: The principle of "floating". Note: No lateral forces are occurring!

In addition to that, there are ways to turn the platform as a whole to focus the panels to the sun. CSEM proposes to do this in two possible ways:

• Solar Islands floating on water:
  In this case, the easiest way to construct it is to design it as a spherical platform, which is formed by a swimming ring (typically made of pipeline tubing) over which the membrane is extended and which can be turned very accurately by means of hydrodynamic motors (spaced for instance every ten meters).
   
  
  
  Fig 7: Principle of Solar Island
   

  Fig 8: Turning with the sun
   

  Fig 9: Focusing Principle
   
  

• Solar Islands on Ground:
  Using a special construction on land, one can use exactly the same principle as described above, as shown in figure 10.
   
  
  
  Fig 10: Solar Island on "terra firma"
   
  
  In this case, a channel has to be built, filled with water or oil, in which the Solar Island can float just like on the sea. Please note that the length of the channel is proportional to the radius of the island, but the surface to the square of the radius. This means: The bigger the island, the less of a problem to build the channel – the costs become soon negligible in comparison to the total costs. The bigger the island, the more the costs are primarily defined by the costs of the solar panels.

Fig 11: Solar Islands – on high sea, near the coast or in the desert

This is why the concept of Solar Island clearly provides a lowest cost solution for solar energy, as the solar panels used are simply – glass! And the focusing mechanism is very simple.


Fig 12: Computer simulation of large Solar Island

Combined Systems

The efficiency of the high temperature solar conversion into electricity is estimated to be around 10%, as mentioned in the paragraphs above. This is a very conservative value; actual experiences let us hope to achieve efficiencies nearer to 15% than to 10%. In addition to that, there is the clear and interesting possibility to combine the energy conversion to electricity with water desalination and/or district chilling. Depending on the local situation of the site of a solar island, as long as it is either on land or not far from a coast, the co-use of the electricity generation process can be used to increase the overall efficiency considerably. Values of up to 18% seem feasible. At such efficiency levels, solar islands would generate electric energy in a commercially competitive way already now.

Energy and Profitability Considerations

Efficiency can be estimated in several ways. We know that it will be somewhere between 10% and 20%, from solar energy to electricity. Let us, for the time being, assume an efficiency of 15%. As outlined above, in very sunny regions at latitudes between 20^o north and 20^o south, we get about 220 kWh converted energy per square meter and per year, at a mean power of about 250 W solar power per square meter (clear sky). An island with a radius of 1.5 km, covered at 90% with solar panels, having an active surface of 6.4 square kilometers, provides a maximal power of 0.96 GW (Giga Watt) and a mean power (24h/24h) of 192 MW, generating energy of 1.5 TWh per year (1.5 billion kWh per year). This is corresponding to the energy of a small sized nuclear power plant!

Calculation Sheet:
Radius	1.5	km
Surface	7'068'583	Square Meter
Conversion Efficiency	15%
Active Surface Coefficient	90%
Active Surface	6'400'000	Square Meter
Cost per Square Meter (Panel)	150	USD
Cost Overhead	20%
Assumed Price per kWh (2008, no subsidies by Governments)	0.17	USD
Mean Solar Power Per Square Meter (clear sky)	200	W
Maximal Power Per Square Meter (perpendicular to sun)	1'000	W
Sunny Days per Year	330
Mean Power	192	MW
Maximal Power	960	MW
Energy per Year	1'500'000'000	kWh
Income per Year and per Square Meter	40	USD
Income per Year	255'000'000	USD
Cost	1'152'000'000	USD
Operation and Maintenance Costs	115'200'000	USD
Amortization and Interest	92'160'000	USD
Profit	47'640'000	USD
ROCE (return on capital employed)	4.10%
Break-even Price of kWh	0.15	USD

As this calculation shows, the business of Solar Islands starts to become profitable at an energy price of around 12 cents per kWh of electricity. The ROCE (return on capital employed) is already 5% at energy prices of 15 cents per kWh. Other important profitability parameters:

• Panel costs, estimated to be 100 US$ / m², will be quite possibly lower at high quantities
• Efficiency levels, estimated at 10%, will be quite possibly higher, for two reasons:
  • Maturity of technology will increase the performance
  • Co-generation of cold (for district cooling) and sweet water production is increasing the overall efficiency of the process

We do firmly believe that a mixture of these three areas for potential profitability increases will allow for a very interesting business in solar energy at very high volume.

Photovoltaic and Solar Island

A special construction of concentrators allows combining the principle of Solar Island with photovoltaic panels (figure 13).


Fig 13: Photovoltaic panels combined with concentrating mirrors

As shown in this figure, the solar irradiation can be increased by up to a factor 10. This means that only 1/10th per sqm is photovoltaic material, 9/10th is of mirror material. Even at photovoltaic costs of up to 500 US$ per sqm, the mean cost per sqm is as low as 140 US$. This principle therefore not only allows for very cost-efficient PV solutions, but at the same time the fixation, cleaning and connection of the PV panels becomes much simpler. The concept of solar islands opens possibilities in CSP (concentrated solar power) and photovoltaic!

Cost Comparisons

The comparison of cost per kWh (i.e., not price – that is yet another issue!) is difficult to do. It has to base on a certain number of assumptions. Our estimations yield the following results (figure 14):


Fig 14: Cost comparison

The comparisons are made for latitudes of below 20^o - at more northern sites the costs per kWh goes up in line with the reduced solar radiation (see Annex 1). It is obvious that all solar-island-type solutions are extremely cost competitive.

Next Steps

Many countries and many institutions have shown their interest for the ideas of Solar Island. CSEM has founded a company named Nolaris Inc., so as to be able to follow up on this interest. Nolaris is currently in a start-up mode, but it already pursues potential contracts in Malta, Qatar, Chile and Tunisia.

The most concrete partner is the government of Ras al Khaimah, the northern-most Emirate in the United Arab Emirates (UAE). Ras al Khaimah decided to finance a prototype solar island in the desert of the UAE near Ras al Khaimah City. The construction of this prototype island (diameter 100m) has started; it should begin to operate by mid of 2008. It will prove the feasibility of the concept and give a clear idea about the achievable costs.

References

[1] Patents claimed and deposited - all ownership of intellectual property rights are with CSEM S.A. and Nolaris S.A..

[2] Disclaimer: This is a conceptual description, meant to clarify new ideas for solar technology, so that they can be discussed and analyzed. Please do not definitely rely on this data, as it is subject to detailed technical discussion and feasibility.

[3] Solar electric energy is today about three to four times more expensive than electric energy from nuclear power plants. Solar "storable" energy (like liquid hydrogen or other energy carriers) needs to be generated from solar electricity (at least, based on today's technologies). The comparison of crude oil and "solar" hydrogen is therefore even less in favor of solar energy. Yet it is this form of energy (not electric energy) which forms the bulk of the global consumption.

Annex 1: Solar Radiation Energy in Different Countries

19th century whaling is today one of the best examples we have of a complete cycle of exploitation of a natural resource.

The production curves of whale oil and whale bone in the United States in 19th century (from "History of the American whale fishery" by A. Starbuck, 1878). Both show a clear bell shaped Hubbert's curve. Click to enlarge.

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A few years ago, I appeared in TV for the first time in my life. Oil had just passed 38 dollars per barrel and I was invited to speak in a national financial channel as the president of the newly formed Italian section of ASPO. When I said that I expected oil to rise well over 40 $/bl soon, everyone in the TV studio looked at me as if I had just said something very funny. All the other experts there hastened to contradict me and said that 38 $ per barrel was just a spike, speculation, and that prices would soon go back to "normal."

Seen in retrospect, it was an easy guess that oil prices had to rise. You only had to know a little about Hubbert's theory. As I am writing these notes, oil prices stand at around 120 dollars per barrel and may well keep rising. But for how long? The problem with Hubbert's model is that it is good for predicting production, but it tells you nothing about prices.

There are all sorts of economic models that attempt to predict prices, but their record is very poor. So, maybe the answer can be found in historical examples. If we can find a resource that has peaked and declined to zero or near zero production in the past, then its historical prices could give us some idea of what to expect today for oil.

There are many resources that have peaked and declined at the regional level; crude oil in the United States is a good example. But the price of US oil doesn't depend only on US production; it is affected by imports from other regions of the world. So that's not useful for understanding price trends at the global level. What we are looking for is a global resource that has peaked worldwide or, at least, in an economically isolated region.

After much search, the best example that I could find is not that of a mineral resource but of a biological one: whaling in 19th century. Whales are, of course, a renewable resource but if they are hunted much faster than they can reproduce, they behave as a non renewable resource; just like oil. We have good data about whaling compiled in books such as Alexander Starbuck's "History of the American whale fishery" (1878). In Starbuck's times there was no such thing as a "global market" for whale products. But the reach of the whaling ships was worldwide and the effects of whale depletion were felt in the same way by all markets in the world. So, we can take the prices reported by Starbuck as directly affected by the behavior of the production curve.

So, here are the results for the two products of whaling; whale oil and "whale bone". Whale oil was used as fuel for lamps, whale bone was a stiffener for ladies' clothes, as were fashionable in 19th century.


Whale oil production and prices (adjusted for inflation) according to Starbuck's data.

Whale bone production and whale oil prices (adjusted for inflation) according to Starbuck's data.

The results are clear: whaling did follow a Hubbert style "bell shaped curve", approximated in the graphs with a simple Gaussian. Whales did behave like a non renewable resource and some studies say that at the end of the 19th century hunting cycle there remained in the oceans only about 50 females of the main species being hunted: right whales.

Now, looking at the historical prices, we see an increase in the vicinity of the peak for both whale oil and whale bone. For whale oil we see a spike after the peak, for whale bone the trend is smoother. In both cases, the smoothed growth is nearly exponential. We can see this exponential trend in the smoothed data.


Smoothed whale bone and whale oil prices (adjusted for inflation).

It seems that what we are seeing now for crude oil parallels the historical data for whale oil and whale bone. There are also differences; for instance the prices of whale oil didn't rise so much as crude oil has been doing lately. On the average, for whale oil we see a doubling of the price, followed by a plateau. For whale bone, we see a much larger increase, more than a factor of 10 from the beginning to the end of the whaling cycle. This increase is comparable to what we are seeing today for crude oil.

There is a reasonable explanation for these differences. First of all, neither whale oil nor whale bone were so crucial for life in 19th century as crude oil is today for us. There were alternative fuels for lamps: animal fat or vegetable oil, a little more expensive and considered as inferior products; but usable. Then, starting in the 1870s, crude oil started to be commonly available as lamp fuel. It probably had an effect in keeping down the price of whale oil. For whale bone, instead, a replacement didn't really exist except for steel, which was probably much more expensive during the period that we are considering. But stiffeners for ladies' clothes were hardly something that people couldn't live without.

In comparison, crude oil is such a basic commodity in our world that it is not surprising that prices have risen so steeply. Airlines, for instance, have no choice in between collapsing and buying oil at any price. For other activities, the conditions of the choice may not be so stark, but still we can't survive without oil. If the exponential rise of oil prices were to continue unabated for a few more years, we would be seeing some kind of demand destruction, indeed.

But the historical data for whaling tell us that an exponential rise of the prices is not the only feature of the post-peak market. The prominent feature is, rather, the presence of very strong price oscillations. We can attribute these oscillations to a general characteristic of systems dominated by feedback and time delays. Prices are supposed to mediate between offer and demand, but tend to overcorrect on one side or another. The result is an alternance of demand destruction (high prices) and offer destruction (low prices).

What we are seeing at present with crude oil is, most likely, one of these price spikes. Eventually, it will overdo its job of curbing demand and turn into a price collapse. We can imagine how, in the collapsing phase, everyone will start screaming that the "oil crisis" of the first decades of 21st century was just a hoax, just as it was said for the crisis of the 1970s. Then, a new upward spike will start.

Here, too, the history of whaling can teach us something in terms of the difficulty that people have in understanding depletion. In Starbuck's book, we never find mention that whales had become scarce. On the contrary, the decline of the catch was attributed to such factors as the whales' "shyness" and the declining "character of the men engaged". Starbuck seems to think that the crisis of the whaling industry of his times can be solved by means of governmental subsidies. Some things never change.

In the end, the history of whaling tells us that what is happening now to crude oil shouldn't have taken us by surprise. The future can never be exactly predicted but, at least, it can be understood from the lessons of the past. One of these lessons, however, seems to be that we never seem to be able to learn from the past.

__________________________________________

I reported the results of this study on whaling for the first time at the ASPO conference in Lisbon in 2005. Later on, I published a complete paper in "Energy Prices and Resource Depletion: Lessons from the Case of Whaling in the Nineteenth Century" by Ugo Bardi, Energy Sources part b. Volume 2, Issue 3 July 2007 , pages 297 - 304. You can find it on line here

If you like to play with Starbuck's data, here is the complete set .

We have run several articles recently on nuclear power and without fail they have stimulated enthusiastic debate. This is an opportunity to continue that debate. To start us off we have three guest contributions:

Skip Meier - Nuclear Waste
Bill Hannahan - We have yet to design the Model T of nuclear power plants
Charles Barton - Thorium Reserves

Last week the UK's Business Secretary, John Hutton gave one of the most pro-nuclear speeches from a Government minister in which he compared the potential of new nuclear development with the North Sea: "the most significant opportunity for our energy economy since the exploitation of North Sea oil and gas," (Platts). Labour MP Colin Challen responded with a letter in The Guardian:

John Hutton's latest reflections on nuclear power demonstrate how rapidly British energy policy is regressing to its default mode - dig it up and burn it. At the same time as we are promised the nuclear pipe dream, we are also set to have new coal-powered power stations without carbon capture and storage. This comes at the same time as we have fought for one of the lowest renewables targets in the EU, are languishing third from bottom in current renewables provision out of 27 EU states, and are announcing yet another microgeneration review.

The message Hutton's department seems to want to promulgate in its energy policy is to reassure everybody that no serious change is needed, that we should carry on increasing our demand for energy and that climate change isn't as urgent as some people make out. One can only conclude that the Department for Business, Enterprise and Regulatory Reform is utterly unfit for purpose and should have the title Department for Fiddling While Rome Burns.
Colin Challen MP
Lab, Morley & Rothwell

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Nuclear Waste

Skip Meier
70ish Theoretical Physicist with educational studies in the mid 1960's to 1973. Ph.D. work in General Relativity and Quantum Field Theory during the early days of attempted quantization of GR; Thermodynamics of Black Holes. Taught at various colleges throughout the US including the Navajo Nation College at Tsaile AZ. Continuing independent collaboration with others on problems in Gravitational Quantization vs Superstring Pseudo-theories. Presently wandering the canyon country of SE Utah and the Colorado Plateau - in the middle of Superfund sites from the last uranium boom and within 20 miles of the only US licensed and presently operating Uranium mill. People here are still dying from the last round of careless unconcern for proper handling (and processing) of radioactive materials, including HLRW.

Introduction

There are at least three expressed goals for the increased use of nuclear fission to provide us with useful supplies of electrical energy as fossil fuels go into decline and anthropomorphic global warming becomes manifest and increasingly more threatening.

• To quickly increase the number of nuclear power plants and electrical output from them over the 21st C. allowing coal and natural gas fired plants to be phased out while sustainable and renewable sources of electric energy can be developed and employed. Moving into the 22nd C. and beyond, we can then begin to phase out nuclear power based upon fission energy.
• To develop sufficient electric nuclear power generation as quickly as possible to provide base load requirements into the foreseeable future.
• To quickly adapt nuclear power as the predominant source of energy while moving to a *all electric* society.

It is my position here that disposal of high level radioactive waste (HLRW) is a major concern for all of the above goals and that permanent isolation by deep geologic burial will be necessary - but is not sufficient. I will be using the definitions for “high-level radioactive waste” and "spent nuclear fuel", often referred to as nuclear waste, from the US Nuclear Waste Policy Act (NWPA) found at this site: Link

(12) The term “high-level radioactive waste” means—
(A) the highly radioactive material resulting from the reprocessing of spent nuclear fuel, including liquid waste produced directly in reprocessing and any solid material derived from such liquid waste that contains fission products in sufficient concentrations; and
(B) other highly radioactive material that the Commission, consistent with existing law, determines by rule requires permanent isolation.
(23) The term "spent nuclear fuel" means fuel that has been withdrawn from a nuclear reactor following irradiation, the constituent elements of which have not been separated by reprocessing.

I will not be addressing the issues of the actinic (and transuranic) fractions of the spent fuel but only the fission decay products - the high level radioactive waste as defined in (12) above.

The Physics of Nuclear Fission and Power Generation

For every Kg of fissile fuel that undergoes fission approximately 850-950 gm of highly radioactive waste isotopes are produced.

1 GWe continuous power generation will produce 8.76 GKWhe energy (1 GW Year), consume about 900-1000Kg of fissile fuel and produce about 850-950Kg of high- level radioactive waste (HLRW) per year. This waste is a mixture of isotopes with greatly varying half-lives (decay rates) ranging from fractional seconds to 1My+.

The daughter isotopes will each undergo radioactive decay following the exponential decay function given by A(t) = A(initial)e^ct with c being the individual decay rate of each and related to the half-life by c = -0.693/(half-life in years). However, and this is critical to the understanding of the problem of HLRW, while the fission products undergo their individual decay rates and deplete, more HLRW is being generated at the rate given above - about 850-950 Kg/(GW Year).

The exponential decay function must be reconsidered and modified when the isotope undergoing decay is also being produced. For simplicity, if the rate of production is held constant and is represented by “S”, then the amount of that isotope present after a time t is given by the exponential function:

A(t) = [A(initial) + S/c] e^ct - S/c
where c is as before.

Because c is negative -S/c is a positive quantity and e^ct will go to 0 with increasing time, leading to the constant value -S/c for the amount of HLRW accumulated and eventually maintained with a constant yearly production rate.

As stated above, each fractional isotope in the HLRW has a different half-life (HL); each will accumulate to a different limit as time progresses; but a feel may be obtained for what occurs by using an average HL of 50 yrs. (based on the assumption made by many that after 500 years the HLRW is ‘harmless’.) Assuming this gives c = -0.014/yr (from c = -.693/HL).

A value of S = 900Kg/yr. and the c above gives an eventual steady state value of:

64 tonne HLRW as the asymptotic limit for each GW Year unit of energy generated and after 500 years (10 HL’s) 63 tonne will be present on the planet.

It is certainly true that the 900 Kg produced during the first year will have been reduced to 0.9 Kg. after 500 years but there will be 63 tonne requiring isolation.

Let us consider the single HLRW isotope Cs(137) - which is both a beta and high energy gamma emitter with a HL of 30 yr. and therefore very dangerous. Cs (137) makes up about 3.5% (by mass) of the fissioned nuclei and therefore has a yearly rate of production of about 31.5Kg/yr. for each GW Year unit of energy production.

For Cs(137), c = -0.023 and with S = 31.5 this gives an accumulated steady state value of:

-S/c ~= 1.4 tonne for each GW Year unit of continuous energy production.

Associated Health Risks

High level radioactive waste does not exist in nature (at any measurable level), is partially composed of isotopes of elements, for example cesium, iodine and strontium, that are easily incorporated into the chemical and physiological structures of organisms - they are readily taken up and, if not isolated, will pass up the food chain - in both land and water - from plant/algae to herbivore to carnivore (becoming more concentrated with progression); as they decay within the longer lived higher organisms, cellular and organ damage can occur as well as DNA modification leading to cancer some time later.

Additionally - and very important - some are extremely dangerous without ingestion; merely being in proximity can be very damaging if not fatal. Since ‘proximity’ depends not only on ‘closeness to’ and which isotope (and amount thereof) is present but also on time of exposure, it is very difficult to protect against accidental exposure without permanent isolation of the HLRW; this will become exceedingly more difficult as we increase our nuclear power generation output and the total amount of accumulated(-ing) HLRW which include some second (and third) generation isotopes of the original HLRW - for example, Cs(135) with a half-life of 2.5 My.

A review of the radiative characteristics of (some) the HLRW products can be reviewed on the following two links (Wikipedia sites, not complete):

Fission product
Fission product yield

We have yet to design the Model T of nuclear power plants.

Bill Hannahan

Each new technology has a life cycle. It starts with an idea, then a prototype. If the technology involves high energy and/or hazardous materials, the prototype is often the most dangerous example, but there is only one prototype, so its risk to society is low. Risk to the public is greatest when the immature technology is first deployed in large numbers.

We have frozen nuclear power technology at its most dangerous stage of evolution for 30 years, yet it safely generates about 20% of our electricity in the U.S., 80% in France. Next generation plants will have fewer parts and passive safety systems, including the ability to contain a full meltdown.

General Electric ESBWR
Nuclear News on the ESBWR (.pdf)

Westinghouse AP1000

Areva EPR (.pdf)

Today we should be designing fourth generation nuclear plants, building third generation plants, living off the energy of second generation plants and converting our first generation plants into museums. In fact, no two nuclear power plants are exactly alike. We have yet to build the Model T of nuclear power plants.

Imagine that Boeing built airplanes in a swamp, outdoors, far away from any attractive place to live, using minimal tooling and equipment. Workers and equipment would be exposed to rain snow dust heat and insects. Very high salaries would be required to attract workers away from their families to work in harsh conditions. Productivity and quality would be low. The airplanes would be more expensive, less clean, less safe and less reliable than modern factory built planes. That is the way our first generation nuclear plants were built.

We should build facilities to mass produce floating nuclear power plants. They would consist of a canal 600 feet wide and a mile long, enclosed inside a building equipped with high quality lighting, heat, air conditioning, fire protection, communication systems, cranes and tooling, that provide a comfortable safe efficient work environment.

The process begins with a dry dock where a massive steel reinforced concrete barge is constructed. It is floated down the canal for installation of modular equipment. Employees will have safe, permanent, high paying jobs in an attractive coastal location. The application of assembly line techniques will dramatically reduce man-hours, construction time and cost, while improving safety and quality. The completed plants will be towed to coastal or offshore sites, prepared in parallel with plant construction.

The biggest single element in the cost of conventional nuclear plants is the interest on the loan to build the plant, about 1/3 of the total cost, due to the long construction time. Floating plants will be produced initially at the rate of two per year ramping up to about six per year, eliminating most of the interest expense.

A facility to mass produce floating nuclear power plants was actually built, for details see here.

We can make clean safe inexpensive energy available all over the world, have the high paying jobs and control the technology. We can design the plants to be highly resistant to acts of terror and the diversion of nuclear material, insist that plants be subject to international inspection as a condition of sale or lease and sell or lease these plants at a cost that is much lower than traditional construction methods, eliminating the fig leaf of energy production to hide a nuclear weapons program.

Cost

Reducing U.S. emissions now is of minor importance. If we eliminate all of our greenhouse emissions tomorrow, the developing world would gobble up the savings in a relatively short period of time.

The most important goal for the U.S. should be to accelerate the use of our technical capacity to develop energy technology that is less expensive than fossil fuel and can be implemented quickly all over the world. People will make the switch quickly and voluntarily, not kicking and screaming.

This is why the U.S. should increase R&D spending for non-fossil energy sources from $3.00 per person per year to $300.00 per person per year, $90 billion per year.

The money could be raised simply by adding 2.25 cents to the cost of each kWh.

We should be pushing every technology as hard as possible and building demo plants of each as it becomes possible.

What are the odds that a submarine reactor on steroids is the best way to produce massive amounts of commercial nuclear power? There are dozens of ways to split uranium and thorium atoms, here are a few examples.

2.25 cents per kWh would raise $18 billion each year from our existing nuclear power plants, more than enough to build at least one demonstration facility to mass produce floating nuclear power plants and several prototype reactors using advanced technology. That leaves $72 billion per year for non nuclear energy R&D.

Mandating the widespread use of expensive energy systems has resulted in the highest electricity prices in the world, Denmark, 41 cents per kWh, Germany, 30 cents per kWh (Electricity prices for EU households and industrial (.pdf)) yet they still get most of their electricity from fossil fuel.

We pay 9.5 cents per kWh in the U.S... A year’s supply of electricity costs the average American $1,260. Mandating expensive energy systems could easily double that figure. Technology mandates are far more expensive than the cost of developing better technology.

Letting a bunch of gray haired law school graduates in Washington DC try to cherry pick energy technology is a formula for disaster.

France is 80% nuclear, most of the rest is hydro, and they pay 19 cents per kWh. France runs its nuclear power industry like the U.S. runs the post office, and they are building windmills now to show more renewable energy, so their cost will likely rise in coming years.

Our nuclear power plants have been paid off for a long time and they help keep prices down. The operation and maintenance cost for U.S. nuclear plants in 2006 was 2.0 cents per kWh (link) including the fuel assembly cost of 0.5 cents per kWh, of which the uranium cost was 0.19 cents per kWh.

Expensive energy systems will not solve the world’s energy problem because most people cannot afford them.

If we spend 2.25 cents per kWh on R&D for a decade or so we can solve the energy problem and save over $1,000 per person per year for centuries. Accelerating the development of low cost, clean, safe energy systems is the greatest and cheapest gift we can provide to future generations.

For more details go to: Bill Hannahan's essay on energy.
Download the PDF and spreadsheet (mid page).

Thorium Reserves

Charles Barton
Charles Barton grew up in Oak Ridge, where his father was a reactor chemist. Barton learned about Liquid Fluoride Thorium Reactors from his father, who spent nearly 20 years researching them. A retired counselor, his blog, Nuclear Green focuses on the history of nuclear research, and on the potential role of thorium cycle reactors in providing the world’s energy needs.

In 1962 a team of Geologists from Rice University in Houston, Texas, took a few months to explorer the Conway Granites of Vermont. At the time Rice Geologists were usually involved in a search for oil, but these geologists were under contract from Oak Ridge National Laboratory to look for Thorium. ORNL Scientist had the crazy idea that they could build a thorium fuel cycle reactor that could produce a billion watts of electrical power for a year from less than a ton of thorium.

The Rice Geologists J. A. S. Adams, M.-C. Kline, K. A. Richardson, and J. J. W. Rodgers reported:

The costs of extracting the uranium and thorium from the Conway granite are estimated by workers at the Oak Ridge National Laboratory to be less than $100/pound, or at most five to ten times the present costs of nuclear raw materials. This source of nuclear fuels, therefore, is currently uneconomic compared to the sources now being utilized. In terms of total energy content, however, the Conway granite represents an energy resource several orders of magnitude larger than the lower cost material. In the long-term future, when supplies of cheap uranium and thorium may start to be exhausted, sources such as the Conway granite may become increasingly important and necessary.

They concluded:

Thus the importance of the present work on the Conway granite lies in the indication that tens of millions of tons of thorium are available when the need for vast amounts of higher-cost nuclear fuel becomes pressing. These amounts may be compared to the few hundreds of thousands of tons of previously estimated thorium reserves. It is reassuring to know that the long-term future of nuclear power is not limited by the supply or by a prohibitively high cost of fuel. Furthermore, the Conway granite may become even more important considering the likelihood that improved extraction techniques may make the thorium available at costs well below the $100/pound estimated in preliminary laboratory experiments. It is also possible that larger amounts of lower-cost thorium might be realized by locating high-grade ore reserves such as the Lemhi Pass, Idaho, area may prove to be, or by finding a large granitic batholith more economic than the Conway.”

...

“Finally, it should be noted that the statistical and exploration techniques developed in the present work and described above, particularly the portable gamma-ray spectrometer, may make it possible to explore for thorium and develop reserves far more cheaply and rapidly than was the case for uranium.

Source (.pdf)

Last year the a rumor began to circulate on the Internet of a remarkable geological find at Lemhi Pass in Idaho. Recently the USGS has estimated the United States Thorium reserve at 160,000 tons, but the story that was circulating claimed an assured reserve at Lemhi Pass alone of 600,000 tons. Thorium is a heavy metal. Like Uranium 238, Thorium 232 is fertile. Thorium absorbs neutrons, in reactors and other neutron rich environments. The neutron triggers a transformation process that converts Th233 into U233. U233 is fissionable like U235 and Pu239.

Thorium Energy, Inc., the major holder of the Lemhi Pass thorium vein, recently posted on the Internet a report on its Lemhi Pass finding:

Thorium Energy, Inc.™ owns the proprietary mineral rights to the largest claim in this region, representing what is believed to be one of the single largest privately owned Thorium reserves in the world.

...

The Company’s reserves consist of 68 separate resource claims, each consisting of approximately 20 Acres, located in the Lemhi Pass Region, which is situated along the border between Idaho and Montana. Included in the Company’s claims are significant mining veins, which contain 600,000 tons of proven thorium oxide reserves. Various estimates indicate additional probable reserves of as much as 1.8 million tons or more of thorium oxide contained within these claims. The Company’s claims also include significant deposits of rare earth metals.

...

Metallurgy tests conducted in the region estimate that the average mine run grade is approximately 5% or more of thorium oxide (ThO 2). In fact, vein deposits of thorite (ThSiO 4), such as those that occur in the area of the Lemhi Pass, present the highest grade thorium, mineral, and are believed to contain approximately 25 to 63 percent thorium oxide (ThO 2) per ton of raw ore. Thus one ton of thorium ore could potentially yield as much as 500-1,200 lbs. of high grade thorium oxide (ThO 2), as compared with less than one percent of raw Uranium ore that is typically utilizable. The deployment of Lemhi Pass Thorium represents a more economically feasible source of nuclear grade ore than Uranium deposits.

Source (.pdf)

Why is this thorium reserve just now being discovered? An Australian Government, Geoscience Australia report states:

“Exploration for thorium to date has been minimal and there are no comprehensive records of resources, mainly because of a lack of large-scale commercial demand.”

What is true of Australia is also true of the United States, and indeed the rest of the world.

Research has demonstrated that it is possible to design reactors that will convert thorium 232 to U233 very efficiently. 800 kg of thorium 232, under a ton, converted into U233 can produce a billion watts of electricity for a year.

See Liquid Fluoride Reactor (Wikipedia)

The 600,000 proven tons of thorium at Lemhi Pass represent enough energy to power the United States for as much as 400 years. 1.8 million tons of thorium contains enough energy to power the United States for well over 1000 years. The tens of millions of tons of thorium that Rice University Geologists reported in 1962 finding in the Conway granites of Vermont could last the United States for a very long time.

Andris Piebalgs continues this Friday his blogging on bio-fuels, addressing some of the concerns expressed by the readers of the last blog-entry.

I agree that a radical change in consumer behavior is needed if we want Europe to be more energy efficient. At the same time, as policy makers we have to come up with policies that are based on present day realities. And the reality is that most Europeans are living and working in big cities and using modern means of transport. It would be unrealistic to impose sanctions on car producers and users if no alternatives are provided.

Before continuing I can't but express once more my joy in seeing EU's leaders having such a close interaction with their citizens. More bio-fuel talk under the fold.

[break]

Crossposted at the European Tribune.

In Europe, we use less than 2 percent of our cereals production for biofuels, so they do not contribute significantly to higher food prices in the European context. Even if we reach our 10% biofuels target by 2020, the price impact will be small. Our modeling suggests that it will cause a 8 to 10% increase in rape seed prices and 3 to 6% increase in cereal prices. Increase in the price of the latest has very small influence on the cost of bread. It makes up around 4 per cent of the consumer price of a loaf.

[...]

We need to use first-generation biofuels as a bridge to the second generation biofuels using lignocellulosic materials as a feedstock. With this in mind, the Commission within the forthcoming review of the Common Agricultural Policy will urge the farmers to invest more in short rotation forestry crops and perennial grasses which are the most typical feedstocks for advanced biofuels.Over the past 30 years, Europe’s farmers have stood accused, through their association with the Common Agricultural Policy, of over-producing and dumping their surpluses with the aid of massive export subsidies on over supplied world markets, therefore depressing market prices and contributing massively to poverty and starvation in poor countries. That criticism has now been reversed. The charge now is that EU biofuel policy will contribute to third world poverty by driving food prices up. My impression from this debate sometimes is that we the Europeans know best what is good for people in developing world. Let them speak for themselves.

[...]

And let’s not forget that oil is a finite commodity, and high oil prices are one of the main factors making food more expensive, particularly in poor countries.

The most important questions raised in the previous log entries were left unattended. Here's a simple accounting exercise to get a real sense of proportion:

The EU consumes today roughly 20 Mb/d of Oil. Of that about two thirds are used in Transport, make it 13 Mb/d. Assuming that EU's Transport use remains unchanged up to 2020 that turns the target to something like 1.3 Mb/d.

Ethanol has an energy density of about 60% of gasoline, biodiesel is somewhat better, so make it 75%. Thus to replace those 1.3 Mb/d of Oil, about 1.75 Mb/d of bio-fuels are needed ( 1.3/0.75 ).

Ethanol production in temperate climates has an EROEI below 2:1, biodiesel about 4:1. Oil's EROEI differs markedly from place to place (offshore versus onshore, etc) but 10:1 is a general enough mark. Accounting for EROEI, the useful energy the EU gets from Oil is about 1.2 Mb/d. To match that useful energy, total bio-fuels production has to rise to 2.1 Mb/d ( 1.2/0.75/0.75 ).

Corn crops yield about 3500 litres of ethanol per hectare per year (that's 9.5 litres per hectare per day). With sugar cane in the tropics that number goes up to 6000 (16,5 litres per hectare per day). But for bio-diesels the numbers are considerably lower, around 1250 litres per hectare per year (3,5 per hectare litres per day).

Using 159 litres for a barrel, 2.1 Mb correspond roughly to 333 Ml (mega-litre). Using again the most optimistic figure for the temperate regions, the EU needs to allocate thirty five million (35 000 000) hectares to bio-fuels production.

I live in a state that has an area of less than 9 million hectares. Germany has an area just over 35 million hectares.

All that dark green area producing ethanol in 2020?

Good or evil? Friend or foe? This kind of wording doesn't fit in my Engeneering/Architecture dictionaries. Bio-fuels are not an option, it's all a matter of numbers.

Data sources:

Ethanol fuel

Biodiesel

The EROEI of ehtanol

Previous coverage of Andris Piebalgs blog:

Andris Piebalgs on Bio Fuels

Piebalgs on European Energy Security

Andris Piebalgs' Blog

Luís de Sousa
TheOilDrum:Europe