When considering a direction in clean energy, five basic requirements must be satisfied in order to ensure a low-risk and a rapid return on investment. These criteria include:
• Environmentally Clean or Cleaner
• Commercially Available,
• Domestic Resource Base,
• Positive and Immediate Impact on Domestic Economy
• Affordability
While there is a vast array of technologies that claim to support these goals, few technologies can actually meet these requirements, today. Claims for commercially viable alternative energy solutions are in the distant future. For the most part, they are constrained by perception, economic, regulatory, technical, reliability and durability issues. Outside of government investments and incentives, in today’s risk-adverse world, the likelihood to secure the necessary funds to develop and commercialize a technically sound clean energy solution is a difficult and remote opportunity.
In terms of what renewable energy technologies make the most sense, it must be understood that in the U.S., electric power generation, transportation and industry are the big three contributors of greenhouse-gas emissions with each generating 2.4, 2.0 and 1.4 billion metric tons in 2007, respectively. Of the total energy consumed in the U.S., 40% comes from petroleum products, 23% from coal and 22% from natural gas. Nuclear power (8%), biomass (3%), hydro-electric (3%) and geothermal, solar/PV and wind (1%) plays a minor but conceivable growing role. The Energy Information Administration sites use of natural gas in the U.S. economy includes industrial (35%), electric generation (29%), residential (20%), commercial (13%) and transportation (3%). Additionally, a comprehensive study released on July 4, 2008 by the American Clean Skies Foundation (ACSF) and Navigant Consulting, Inc. (NYSE:NCI) indicates the United States has 2,247 trillion cubic feet (Tcf) of natural gas reserves, which is enough to last more than 100 years.
With about 250 million registered vehicles in the U.S., the transportation sector offers a tremendous opportunity to reap the benefits of renewable sources of energy. Diversification of America’s transportation fuel portfolio includes a short list consisting of all-electric, hybrid PHEV, bio-diesel (B100) and blends, ethanol, propane, and hydrogen. While these choices have some environmental and economic benefits for light duty-vehicles (up to 8,500 GVW), natural gas for vehicles is the logical energy choice due to its proven technology, commercial availability and compatibility with internal combustion engines. In combination with the existing base of medium- and heavy-duty vehicles, this results in tremendous economic benefits for fleet operators that convert their vehicles to use natural gas. Additionally, electric and hybrid alternatives are not available or a good choice due to performance limitations for medium-duty (up to 14,000 GVW), medium-heavy-duty (up to 26,000 GVW) and heavy-duty vehicles (over 26,000 GVW). Finally, bio-diesel and blends may not meet the air quality standards mandated by the EPA.
Corn based ethanol and biofuels suffered a setback as a result of last year’s market dynamics and arcane reports such as that by Lester Brown, President and Founder of the Earth Policy Institute. Ethanol production is market driven and requires that corn be competitively priced. As the price of corn increased, the cost advantage for biofuels diminished, leaving nascent companies to defer or cancel operations. Much of the public outcry for corn based biofuel emanated from an intangible concern for the reallocation of a universal feedstock to fuel-stock. In reality, the upward pressure in corn prices was as much a function of rising fuel and transportation costs as the combined effect of skyrocketing global demand and production shortages from dry weather conditions. Needless to say, the use of corn as a biofuel became uneconomical and unpopular. Though on the horizon there is a vast array of elegant and promising biomass and cellulosic ethanol technologies, which down the road can satisfy the ever increasing demand of the transportation industry.
However, natural gas lacks many of these problems and is an extremely viable candidate to supplement America’s reliance on foreign liquid fuel. In the U.S., 64% of the petroleum used is from a foreign source versus natural gas which is 97% North American based. Overall natural gas is clean, affordable and abundant in the U.S. It can save dollars, is renewable, has a lower carbon footprint than liquid petroleum, is clean with near zero emissions and reduces greenhouse gas emission, is a domestic resource and is a bridge to ultimately cleaner energy sources such as hydrogen. Today and within the conceivable future, natural gas is a commercially and economically viable alternative fuel for the large and relatively untapped transportation market, which uses less than 3.0% of all natural gas produced in the U.S. and accounts for less than 0.5% of all fuels.
Natural gas is an inherently clean fuel since it is mostly methane having one carbon atom per four hydrogen atoms or 60% by weight carbon (diesel – C14H30 is 74% carbon; gasoline – C8H18 is 73% carbon: Propane – C3H8 is 70% carbon, by weight). Also, natural gas has less NOx, soot and greenhouse gases than petroleum fuels. Safety wise, natural gas is lighter than air, dissipates when released, has a high ignition temperature of 1000 – 1100F, has a limited range of air/fuel combustion ratio of 5 – 15%, does not leak into ground water and is governed with proven fuel tank, vehicle and station codes. Converting one refuse truck from diesel to natural gas is the equivalent of taking as many as 325 cars off the road in terms of pollution reduction.
Air quality issues are gaining added political traction as health toll and economic impact is tallied. A large percent of the population lives in what is considered non-compliant areas and by 2010, 320 counties in the U.S. are likely to be deemed non-complaint. Fleet operators are feeling the impact of EPA’s 2004, 2007 and 2010 requirements. Due to these regulations, 2004 diesel powered vehicles suffered a 3 – 6% decrease in fuel economy with further declines anticipated in 2008. In addition, complex exhaust after-treatment technologies are expensive and maintenance intensive. Finally achieving the 2010 NOx reduction to 0.20 g/hp-hr presents an unresolved dilemma.
Light-, medium- and heavy-duty vehicles can be converted to natural gas using proven 4th generation technology. Only one factory-ready sedan is sold – the Honda Civic GX – so vehicles have to be retrofitted for CNG fuel. As in any emerging technology, first generation systems needed improvement and not all 3rd party installers were created equal. Early issues facing CNG fleet managers concerned durability, reliability, cold starting and performance. But newer systems have addressed them.
With the market wide open for use of compressed natural gas (CNG) as a fuel for vehicles, the main constraint hampering expansion is the availability of refueling stations due to their high up-front capital cost. CNG stations cost about $400 thousand each for small CNG time-fill stations generating less than 6,000 dge per month and $800 thousand each for mid size, stations generating less than 20,000 dge per month to $1.5 million each for large stations generating up to than 20,000 dge per month and $2.5 million each for high capacity stations generating up to 80,000 dge per month. This impediment can be overcome on the short-term basis by expanding the conversion of vehicles to CNG and cost sharing between local fleet owners. Long-term, expanded use into the public sector, improved reliability of key systems and innovative compressor designs can help to reduce station costs.
The compass points towards a tremendous opportunity for broad market adoption of natural gas as a vehicular fuel. Today, natural gas can rescue our bleeding budgets and bulging trade deficits. No technological advances are needed, only enlightenment. It just requires what Lee Iacocca pleads for in his latest book, Where Have All the Leaders Gone? — the leadership, courage and common sense to move forward.
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By. Dr. Barry Stevens
Dr. Barry Stevens has over 25 years of proven international experience building technology-driven enterprises and bringing superior products and services to market ahead of the competition. He is the founder of TBD America Inc., a technology business development group. In this role, he is responsible for monetizing technologies and leading globally-competitive companies to higher levels of revenue, earnings, and growth. Please visit TBD's website at http://www.tbdamericainc.com and his blog at http://barryonenergy.wordpress.com
