 | Oil Reserves: Where Ghawar goes, the rest of OPEC follows | The Oil Drum: Australia/New Zealand | Doomers |  |
The Bullroarer - Wednesday 28th May 2008
Posted by Big Gav on May 28, 2008 - 9:24am in The Oil Drum: Australia/New Zealand
ABC - Waking From The Dream
Daily we hear more about 'peak oil': a looming moment when the world's oil reserves will start to decline. The idea has been about for a while, but has been dismissed by governments and industry as the baseless rantings of survivalists, doomsayers and eccentric dons. Not so anymore.
Both the Australian Senate and the United States auditor-general have recently warned that the peak is real and imminent. No matter when it occurs, explosive global demand and geopolitical instability mean that the golden age of oil abundance is behind us. ...
Sometimes passing through and surviving one (modest) crisis engenders not a sharpened wariness but its opposite, a heightened sense of invulnerability. So it seems with the 1970s oil shocks, which by the 1990s had passed comfortably into memories, adding evidence to the theory that market societies were indeed the 'end of history', our highest and most invulnerable social form.
This explains why the unexpected return of oil scarcity seems so deeply unsettling, cracking open a cemented faith in our invincibility. All the more unnerving is the mounting evidence that coal, our other great - if these days unseen - energy source, is fuelling climate change.
Most of us are guiltily aware that Australia is a global 'filthy man', stoking the global carbon economy with cheap, dirty coal. Dashed inconvenient that exporting it doesn't distance us from the problem, or ultimately from blame.
The Age - The perils of pleasing
The rise in petrol prices gives us a real chance to find ways to live with less oil. ...
Petrol prices have risen essentially because rapidly rising global demand has run into relatively fixed supply. Prices have been pushed higher still by speculators buying oil to withhold and resell at a profit, and by others squirrelling away stockpiles as insurance. There is debate worldwide about how much oil prices have been driven up by fundamentals, and how much by speculators and squirrels. Financial Times guru Martin Wolf concludes that higher oil prices reflect the imbalance between demand and supply, and we'd better get used to it. Goldman Sachs forecasts that oil prices will climb to $US200 a barrel. But Anatole Kaletsky of The Times says the recent rises are just speculation, and prices will soon fall. Kaletsky notes that the world is producing more oil that it is consuming (i.e. the extra demand is being stockpiled) and the oil prices soaring are for future supplies, not for oil now. If he's right, our leaders' panic policies will look even sillier when prices subside.
But the long-term problem will not go away. Most countries that produce oil, including Australia, are running out of reserves, and their production is falling. Saudi Arabia and its neighbours could pump out their oil faster, after some big investment, but that would be against their long-term interests. Meanwhile, demand in China, India and the developing world will keep growing rapidly as cars become part of people's lifestyles.
There is far more demand to come. There is not a lot more supply. Our policy response has to be a long-term one of adapting by reducing demand. Instead, Rudd and Nelson are competing to offer short-term handouts.
Larvatus Prodeo - Marn Ferguson’s petrol pump politics
John Quiggin thinks that Labor’s descent into the petrol pricing abyss - with all sorts of speculation about GST changes - is the Labor party’s first big public policy disaster of the term. Perhaps unsurprisingly, it’s also led to the first big damaging leak of the term - Martin Ferguson’s letter opposing Labor’s Fuelwatch scheme.
Trevor Cook speculates on the motivations of both Ferguson and the leaker. The other point I’d add to his analysis is that it wouldn’t be drawing too long a bow to suggest that Ferguson is the one spectacular example in the Ministry of “interest group capture” - a Minister who sees his role as being to represent industry to Cabinet rather than to make public policy in the public interest.
SMH - Labor to investigate petrol tax changes
The federal government will investigate whether GST charged on top of the petrol excise should be scrapped. Consumer Affairs Minister Chris Bowen confirmed the petrol price inquiry will examine the "interaction between the GST and fuel excise and see if there are any measures that can or should be taken", Fairfax newspapers reported on Sunday. The move comes despite Prime Minister Kevin Rudd and Treasurer Wayne Swan criticising Opposition Leader Brendan Nelson's plan to cut petrol excise by five cents a litre, the newspaper said.
The Australian - Now Labor divided over petrol
SMH - Qantas grounds jets over soaring fuel bill
Qantas at present only pays around US$72 a barrel for its oil needs, due to its fuel hedging policy where it locks in its fuel contracts at the start of every financial year. But from July 1, the fuel hedging will drop off and most of Qantas's fuel bill will be exposed to the current market price of around US$130 a barrel. It only has a small portion of its fuel bill for 2008-09 locked in at around US$90 a barrel.
The Australian - Tim Flannery warns coal: go green or pay price
ENVIRONMENTALIST and author Tim Flannery has warned Australian coal companies they will face penalties unless they develop green technology over the next two to three years. The 2007 Australian of the Year yesterday took aim at coal companies for "failing to comprehend" that they risked paying carbon taxes after 2010 unless they changed their ways.
Peak Energy - Demand Management in WA - Remote controlled airconditioning
ZDNet has a report on a fairly crude form of demand management being trailed in WA, with local utility Western Power remotely turning off the compressors in customer's air conditioning systems during periods of peak demand - WA utility takes remote control of customers' aircon. I'd prefer in-house systems that are fed with grid demand and (dynamic) price information that can be configured to make these sorts of decisions on based on the customer's own preferences, but I guess this sort of experiment is a start.
New Zealand Herald - Winter blackouts 'very unlikely' - Parker
Energy Minister David Parker says power blackouts are unlikely this winter. Hydro storage is at its lowest for this time of year since the 1992 power crisis and the electricity industry has launched a website to make it easy for the public to check supply details.
Radio NZ - New Zealand too small for nuclear power - electricity chief
The head of the Electricity Commission says a nuclear power plant would be too big for New Zealand's needs. ... Commission chairman David Caygill says an average-sized nuclear plant of 1000-megawatt capacity would end up creating system problems. He says any single generation plant needs the equivalent backup in case it fails for any reason.
Mr Caygill says this is difficult enough now when the biggest single source of generation in New Zealand is 375 megawatts. He says the cost of producing electricity at a nuclear station is about twice that of alternatives. Mr Caygill says a nuclear power industry would also require huge infrastructure.
GWAG - talking and changing
In talking about reducing our impact on the Earth, you'll often hear people talking about redesigning cities, or setting up global energy grids, or putting in monorails or solar panels on the roof. Rather fewer people talking about walking or biking instead of riding, turning the heating and airconditioning off, and so on. We prefer large expensive technical distant solutions to simple cheap or money-saving down-to-earth solutions.
Bloomberg - Origin Energy Is Considering Raised BG Offer, Australian Says
The Australian - B&B to the rescue as power crisis hits
SMH - Record dry May looms for Sydney
Sydney appears set to record its driest May in 150 years of record keeping, after the month's best chance for rain passed with only localised falls. The thunderstorm that rolled across the city late on Wednesday caused a downpour of 37mm in just 45 minutes at Campbelltown, in the city's south-west, but it dissipated as it moved over central Sydney.
Just 0.6 of a millimetre fell at Observatory Hill, taking the city's official May total to 2mm - below the 3.7mm which fell in the record dry May of 1957. Bureau of Meteorology senior forecaster Dave Williams said rainfall data had been collected at the central Sydney site since 1859.
The Australian - Climate for Queensland gas in NSW $750m power bid
SMH - $850m gas-fired power plan for Hunter
An ambitious plan to build a gas-fired power station in the Hunter Valley along with an $850 million gas pipeline from Queensland to the Hunter is being pursued to help ease the projected shortfall in the state's electricity capacity. Queensland Gas has teamed up with the ANZ Bank and Japanese group Toyota Tsusho to study building a 400-600 megawatt power station in the Hunter, with a final decision to be taken once a feasibility study is completed. A 600 megawatt power station would supply about 500,000 households with electricity for a year.
The power station would need the proposed $850 million pipeline to bring gas from Queensland, which is cheaper than the existing pipe supply from central Australia.
Reuters - Indonesia leaves OPEC
Indonesia will quit the Organization of the Petroleum Exporting Countries, Energy Minister Purnomo Yusgiantoro said on Wednesday.
"I will sign (the documents) that we (will) withdraw from OPEC," Yusgiantoro told foreign journalists. "Probably when I go back to the office I will sign it." Earlier this month, President Suslo Bambang Yudhoyono said that Asia's only member of the cartel may quit the group, citing a decline in crude oil output that has reduced its influence in the cartel.
Peak Energy - CETO In New Zealand ?
While Carnegie Corp is lagging in the race to build the first wave power facility in WA, the New Zealand Herald reports that are generating some interest across the ditch - Australian firm wants to catch West Coast waves for energy project.
Peak Energy - What Do Google, Chevron and Goldman Sachs have in common ?
Solar thermal power.
Peak Energy - Fred The Golf Ball
The Guardian has a report on cleaning up the waste from British nuclear reactors - Robots scour sea for atomic waste - "Submarines searching for radioactive material dumped off the Scottish coast in the 1980s. Apparently someone inadvertently dumped some fuel rod waste into the ocean. How careless of them.
The Times - Australia looks for power from hot rocks
Peak Energy - Engineered Geothermal Power
Peak Energy - Transgenic Corn Linked To Neo-Fascism
Contact
- anz at theoildrum dot com
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I think remote switching of aircons will become Australia wide perhaps with exemptions for seniors. I know it was vetoed in Adelaide a few years ago. There are a few problems with sending signals via mains such as blips and radio pulses so that needs to be sorted out eg it was canned in Hobart after a trial.
While the oil majors may be backing CSP that is still not baseload in the sense of never requiring backup. OK Sizewell B went down but after years of consistent output.
No need to repeat the misgivings given in earlier posts about 'engineered geothermal' (low thermal efficiency, redrilling, lack of water control etc). However I'm surprised the prestigious MIT didn't see all this which was obvious to TOD posters.
Sizewell B goes down for unknown reasons, Japanese reactors get taken down by earthquakes, French reactors get taken out by water shortages, Russian reactors get taken down by operator initiated meltdowns etc etc etc
There's always a reason why nuclear is still somehow considered reliable but CSP with storage somehow isn't.
What a crock. They are equivalent, and CSP will end up being a lot cheaper and with none of the side effects.
As for dry rock geothermal, I'm in accord with the MIT guys and all the people currently putting money into these ventures.
If CSP has overnight storage via heated salt or fluid that doesn't solve the rainy week problem. Some say use HVDC connections.. been there done that and I'm now 30% coal dependent when I was coal free two years ago. A gigawatt week of storage would be astronomical using say flow batteries at $500 per kwh.
The way things are going I think before long there won't be enough spare cash for really big ticket items. That's not just nukes but CSP plants that can achieve these economies of scale.
We have been living in a golden age of technological achievement and quite frankly, if CSP was ever going to be possible to deliver baseload, cheaply and reliably it would have been done decades ago. Edison himself, who was more responsible than anyone for the power grid, gave much tthought to solar energy and thought it weas the way forward. In the decades since his death, we have achieved so much more technogically than even he could have dreamed of, but we still do not have baseload solar energy.
In an era which is going to see structural social changes and an unhinging of the consumer/industrial/financial complex, giant technological leaps forward are going to be few and far between. I'd put the chances of large scale CSP right up there with interstellar space travel. The only growing sector of energy management in the future is going to be radical conservation/reduction/elimination areas and most of this will be done with clever thinking rather than snazzy new gadgets.
A whole lot of claims here with nothing to back them up.
CSP was invented 3 decades ago. Oil and coal were plentiful and cheap, so it languished.
Now oil and coal are getting expensive, and the technology is coming into its own.
In a few decades time it will just be the way we generate most of our power - cheap and ubiquitous.
The places where people are building CSP plants don't get rainy weeks - thats how they choose sites.
But you are correct that a larger grid with bigger interconnects would alleviate the problem if it ever did occur in a particular location.
No one is suggesting we use flow batteries for really large scale storage.
Care to explain why cash for power projects will be scarce in an era of high energy prices ?
Its the one sure-fire way to make money...
Governments won't have much money because of war, welfare and fuel tax cuts. Private developers all seem to want subsidies or tax credits from those governments which may not be forthcoming. Oil majors may go the way of the dodo, I note both Exxon and Xerox have the same repeated letter. Then there is the 'Law of Receding Horizons'. Have Khosla or Google made any money yet from energy projects? I'll just allude to a prominent fuel cell developer that never made the expected billions. Maybe Toyota made a good call with hybrid cars. Wind power is now a mature technology. I don't see unambiguous signs there is another technology ready for prime time. That includes CSP, CCS, dry rock geothermal, wavepower and algae oil.
Neither war, welfare nor fuel tax cuts are guaranteed. And governments aren't the organisations that matter - global capital rules the roost now.
While I don't support corn ethanol, Khosla had made plenty of money from it.
Google only started investing in energy last year, so its too early to say if they have made money - we'll see once their investments have matured - however Chevron and Goldman Sachs have long and very successful track records.
And I'll bet Google does find at least one way of producing renewable energy cheaper than coal, as they are aiming to do.
30 odd CSP plants under construction (plus the 10 already in existance) seems to be conclusive proof that CSP is viable.
The question is - when does it get cheaper than gas, wind and nuclear - 2010 or 2015. Its going to happen before too long as economies of scale are realised.
I'm puzzled by the wavepower "race" in Western Australia.
CETO has a couple of full-scale working wavepower generators already operating near Fremantle. (Albeit only test units at the moment, but their progress reports have been good.) - So I wonder why Griffin Energy went all the way to the USA for the Ocean Power buoy technology? Anybody know?
Aha! Could this be it? The forthcoming WA Govt. Binningup desalination plant has shortlisted *both* CETO and Griffin Energy for their renewable energy supply...
http://www.thewest.com.au/default.aspx?MenuID=32&ContentID=75063
http://www.carnegiecorp.com.au/files/asx-announcements/2008/Desal%20Anno... (small pdf)
It may be that the Griffin / Ocean Power joint venture is the only way for Griffin to get some of the desal wave action? (Presuming that CETO doesn't want/need a partner like Griffin?)
Looking at both technical designs, the CETO system would appear to have a design advantage for desal, because it produces pressurised seawater directly, whereas Ocean Power converts buoy movement to electricity at the buoy's anchor point, and would then be subject to further conversion losses using electric pumps to pressurise the intake seawater at the desal plant.
Big Gav's NZ link above quotes CETO at $AUD300M for 50 MegaWatt electric generating capacity ($6M per MW) whereas TheWest News piece above suggests that Ocean Power would be around $2.2M per MW. Who knows whether these figures are actually comparable (or for that matter if either of them is realistic!) but if so, Ocean Power seems well ahead in the "race", even allowing for energy conversion losses.
Although this strikes me as somewhat strange; looking at the competing designs... http://www.itsnoteasybeinggreen.org/forum/viewtopic.php?t=8008&view=next...,
...I would have thought Ocean Power's surface buoys look to have less wetted volume, and therefore are likely to produce less lifting power than the submerged CETO floats...
Maybe we'll only know for sure when the Binningup desal plant makes its choice!
I agree with Big Gav. One way or another we are going to have to go with CSP, wind, wave, geothermal - anything that isn't nuke or coal. The sooner we start, the better. Also, the big, Soviet style centrally planned power model is defunct. There will be some, but power generation, mainly from CSP, needs to become local and small scale with battery and grid back up. Conservation is also an absolute necessity - we need to learn to get by with much less. The switch will require quite sophisticated software and systems to ensure maximum efficiency. Not a watt can be wasted!
I lived on a boat for two years (it is how I came to Australia). We, a family of 5, used approx 4.8kWh per day, mostly generated by sun and wind. We didn't scimp. I needed a cold beer (or two, maybe three) every day and "she who must be obeyed" needed ice in her G&T. Having ice on boat mid ocean takes some doing! Now we live in the burbs we use 10 times as much power, not counting the car, the office, the street lamps and all the rest.
Oil is apparently still too cheap for the punters to start seriously conserving energy.
I was talking to a plumber friend the other day who was telling me about all the tricks that are used to prevent the waste water in high-rise buildings causing problems after it's flushed (potential problems include damaging pressure surges). I said why don't they just remove the impediments, put a turbine at the bottom and generate some power out of all those wasted flushes! I was only joking but he said he'd never heard of anyone trying that - so we coined a name for this idea, the "turd-bine"...
Excellent - maybe you should patent the idea (and name).
But I think these sorts of schemes (combined with energy efficient designs) to extract small amounts of available energy that are readily available will become more and more worthwhile.
I expect that in 40 years time every building will have solar panels, better insulation and an array of energy harvesting and energy efficient devices within and supporting it - by and large being self-sufficient in energy.
Kenneth Davidson at The Age:
Fuel price debate ignores real issue