Electricity vs Kerosene

Kerosene is fuel oil. It's what we burned in street lamps back before Edison's light bulb. Gasoline is car fuel, back before batteries. The similarities are striking.

Boiled down, alternative energy really takes two forms, electrons or liquids. Liquids are represented by bio diesel or ethanol concepts to fill the vast network we already have for the distribution of liquid energy.

But, electrons also take advantage of a huge network for distribution.

But back in the day, we had kerosene lamps that we filled, lamp by lamp down the street, and lit. Similar to how a big shiny tanker truck pulls up to every gas station and deposits a few thousand gallons of fuel into a tank today. We then pull in, fuel up and light it with the starter.

Lets look at this in more detail:

1. People drill a hole in the ground and pump up oil and put it into a truck.
2. The truck goes to a terminal where its pumped in pipelines or loaded on ships to be sent to a refinery.
   
3. There it's refined into gas or diesel and and again loaded into a pipeline, ship or truck.
   
4. From there it makes its way to another terminal where it's put into truck that takes it to your local gas station.

Pretty much like a kerosene lantern on the streets of Philadelphia in the 1800's.

Now electrons:

1. Wind mill makes electricity that travels over wires to your home where you plug in your car.

Hmmm...let's see...I get fuel for my car from a wire at home instead of driving around looking for a refueling station? I'm pretty sure that's how the kerosene lamp died. It just made too much sense to run a wire into the lamp and put in a bulb.

If you really want to simplify it:

1. Solar panel on roof makes electrons that we convert to AC and fuel our car!

It seems kinda silly that we have been taking our lamp to a gas station for fuel doesn't it? It also seems dumb to truck the gas to the gas station. It's kinda like banking before ATMs, credit cards and online access, there were just bags of money.

So why do we still live with this antiquated fuel concept for our transportation? Two words...big oil. They are the ones who own the entire infrastructure and depend on it to generate huge profits. They need us to drive down to a station of theirs and pay the price they set. They do everything in their power to keep this status quo.

But, there will be a time when we will all laugh about the antiquated car fueling structure we hung on to for so long. We will fuel our cars at home any time we want to at a price we have negotiated or with power we have generated ourselves.

I can't wait.

Peak oil

I love stories in the press about "peak oil". They are always presented like we have no choice but to drill baby drill.

Peak oil is a simple concept, when will we burn more oil per day than we pump out of the ground? If you're today's press, a little fear mongering is a great way to develop a headline or two.

The argument, (today's press's bread and butter) is that there is plenty of oil, or, we have already reached peak. Our latest oil shock was partially attributable to the demand issues of an emerging China and India. Many felt the peak was reached and the price of oil reflected that. The press ran with that worldwide.

But let's step back for a minute. Is the real issue peak oil? Or is the real issue peak demand? When will we humans stop growing our demand for oil? Or, more importantly, when will the nation that leads the free world, the US, reach peak demand?

So, do we have to drill our way to the last drop?

That is entirely our choice. We are not destined to run out of oil, or fight more wars over it. It's not pre-ordained. We are not locked in to a peak oil economy!

So I reject the idea that it's a supply issue and I reject the notion that we are stuck here. We all know that oil in every form is bad for our environment, bad for our geo politics, bad for our image around the world, bad for our soldiers and bad for our economy. What once was the engine of our growth is now a millstone around our neck.

Before we can address this challenge let's at least get it defined correctly. It isn't how much oil is out there or who we have to fight to get it...it's how much we use. And we have a choice about that, and, we should support every effort to reduce it. Alternate forms of energy are out there and they are becoming more competitive every day.

New mileage standards

Today's green headlines talk a lot about new aggressive mileage standards for vehicles in the US, and California.

We have had mileage standards for many years yet we are far behind the rest of the world on this front. In addition:

Our car makers are on life support.

We import a huge amount of oil.

The city of Dallas regularly exceeds its air pollution standards.

The question is...are all those things caused by the vagaries of the market or is it in fact the problem with government rule making? Is the government able to implement and manage complex market changing regulation when large scale business is involved?

The answer is no.

Our car makers are a huge industry with a lot of political clout. They are union labor which has huge political clout. The foreign car makers doing business in our markets have clout. The oil companies who depend on the car business have huge clout. All the tertiary businesses connected to cars represent a large amount of voters.

With all of that monetary and voter pressure to "do whats right " for the auto industry, what politician could do anything different than be highly sensitive to their wishes?

We now have a 650 page initial document on new vehicle mileage standards and it will surely grow as it goes through the public comment stage. Why 650 pages? Its all the "considerations" of the industry as described.

We all know that the SUV craze was caused by the government exempting this group from the lower car mileage standards. The regulation caused Detroit to focus on big cars and trucks and make more money with them because they had little foreign competition. They became dependent on that revenue stream that dried up with the $4.00 gas price. This crippled the US Auto industry.

So looking back now, what should we have done? In my view it's simple. Let the market work.

When we had an energy crisis in the Carter era we should have responded with real change...many countries did. But instead we worked really hard to get OPEC in line and get things back to "normal". We sold our independence and stability for cheap foreign oil. Why, because we could. We were huge customers that could bomb them off the map. We have been meddling in Middle East affairs ever since.

So we have artificially supported cheap oil. We spend a huge amount of money (and lives) making sure we get our cheap oil. This is a government distortion of the market...they enact the diplomacy and the wars.

Oil comes from risky places, is an environmental mess, is price volatile, pollution generating and politically and religiously charged. But does $2.00 a gallon gas reflect that? Of course not, it's an artificially low price matched only by the big oil producing countries themselves.

So a $5.00 a gallon price might be more accurate and you could throw away that 650 page document. American consumers have already shown they will eschew big cars and trucks at $4.00 a gallon and so has the rest of the world.

A pollution fee for the air we foul and a military fee on gasoline would do the trick, and be a lot less pages. Or we could just make an amendment to the constitution that we would never use military might to secure goods and services outside our borders.

Bottom Line - Cheap oil is bad because it's artificially cheap. To enact laws and complex regulations to artificially make us all use less of an artificially cheap product is silly. To spend more money bailing out Detroit because of our own artificial market distortions is sillier yet.

There is some new sabre rattling about reducing the huge incentives and supports for the oil industry. Can you imagine? We artificially support our oil companies? Just like our farmers and our auto industry? Does any of this artificial support work in the long run?

We have to artificially support renewable energy so it can compete with the artificially supported oil and coal industries?

I get the feeling that good lobbyists are way more valuable than a good product aimed at a healthy market.

Nuke or not?

It seems almost impossible that we are still having this discussion. The last Nuclear plant constructed in the US was started in 1977! That little mishap at Three Mile island? 1979. Coincidence? Not hardly. We decided, rightly or wrongly that coal was less dangerous than Nukes. (Tell that to a Virginia coal miner).

But now, with carbon reduction on the agenda, are Nukes a renewable clean energy resource? The simple answer is yes. No carbon, no soot, no mercury, no sulfur dioxide. All you get out of them is warm water discharge, steam and some nasty leftover radioactive material that lasts forever. What's not to love?

Over the years we have spent serious R&D money on Nuclear research, mostly on Nuclear fusion which is different than today's fission reactors. The difference between fission and fusion is that one is available, and the other isn't. (A few thousand nuclear scientists and researchers might disagree that it's that simple, but it is for me.)

It's worth noting that those old fission reactors provide 20% of US electricity today. We have 64 plants operating 104 reactors, all carbon and air pollution free and they haven't killed anyone yet... We are by far the largest world user with France and Japan having around 50 each. There are 436 reactors around the world currently operating. (This number does not include Nuclear ships and subs). China and India have the most under construction.

So what's the point of all the statistics? Well, Nuclear works, works well and is widespread and safe if one judges it on actual performance, not on "what ifs". But the "what ifs" are big ones.

So what if a terrorist bombs one, what if one goes rogue and melts down ala Chernobyl, what if we never find a way to safely deal with the radioactive waste?

There are 295 reactors proposed around the world with the US having 19 of those. Vietnam has 9! China has 90! So are we falling behind? Are we going to find ourselves with less cheap energy to run our economy? Can we afford the let Nuclear fall by the wayside here in the US while the world continues it's expansion? Did you know American companies Westinghouse and GE are major players in the global reactor business?

Bottom Line - After having posed all these question I only have one thought. We either should or shouldn't. This fence sitting and arguing is a ridiculous waste of time for our country. We can't accomplish much of anything meaningful if we are constantly at war with ourselves.

So let's have the largest Nuclear reactor expansion of all time to help save the earth from climate calamity. Or, let's stop all efforts and focus our energy on other...well...energy.

Geothermal - I want some

As we complete the cooling season here in Dallas, I am still pining for a geothermal heating and air-conditioning system. In some ways it's more compelling that a photovoltaic (PV) electricity system. Here's why....

Basically the system is a heat pump connected to holes in the ground. Heat pumps have been around for ages and are generally perceived as more efficient than regular AC compressors and furnaces. And more expensive to purchase and install.

What geothermal does is marry a high efficiency heat pump to a source for steady temperatures from the ground. We have local companies that do this by drilling deep but small diameter holes and running a plastic pipe to the bottom and back to form a ground loop (300 feet). Depending on the size of the system, (mine is five ton), they would drill one hole per ton.

They need 20 feet between each hole and they connect them all together and to a pump to circulate fluid to transfer the ground temperature to the pump. The ground is a steady 68 degrees all year round here in Dallas. This fluid is used to cool the air or warm the air in the heat pump. (It's actually way more complex, but that's the gist of it).

So on a hundred degree day the heat pump, (bad name), takes 68 degree water and uses it to cool the house rather than using a compressor to cool whatever the latest freon equivalent is... That's right, no compressor! No noise outside, no ugly box, no unreliable and expensive outside gear to make coolness.

On a chilly winter day, all the heat pump has to do is get the 68 degrees up to your thermostat setting using natural gas or electric. As a side benefit, you can also put your water heater in the loop so it isn't heating up colder water all the time.

All of this combines to save around 50% on heating and cooling costs per my contractor. Now my guess is your mileage may vary but...that's a huge amount! My AC compressor is rated at 14 SEER and the heat pump is around 27 SEER. The heat pump is a variable device meaning I could safely close off rooms and the heat pump adjusts its output without harm to itself.

50% of my heating and cooling bill would be around $1320 in electric and $450 in gas for a total of $1,770 savings a year. Now the bad news. The cost for the system is $36,000. There is a 30% federal tax credit that brings the price down to $25,200. That translates to a 14+ year payoff at today's utility rates. If I were forced to replace my current traditional system with a similiar system it would cost me $10,000, I know because my neighbor just priced out the same size system for her house.

That means the geothermal system would cost $15,200 more and that would take 8+ years to pay off at today's rates. If I financed that at 8% for 30 years it would be $110 a month or $1320.00 a year. If I could get low cost financing, like 5%, then my yearly cost would be $996 for a really good positive net effect.

It's important to note that is just the dry numbers. Reducing my carbon output 50% is a big deal as is spending less money on utility bills and spending more money on my home. In the future, the reduced electricity use would make a PV system much smaller and cheaper.

Bottom Line - This concept's time has come but we need a little maturity in the market to get prices down and make this a no-brainer. Right now its a good deal if you have the money or the equity in your home to borrow against. We all agree that energy prices will also go up, and then the deal would get even sweeter.

I hope my old system breaks down again soon...(what am I saying?)

Water savings and my city

In the great city of Dallas we have a lot of cheap water. Even when we have droughts and the reservoirs get low, the price doesn't go up.

Just three hours south we have the city of Austin and they don't have near enough water. They understand water conservation better than most, and, they are the capital of Texas. Their city hall is Xeriscaped, ours has a big fountain.

So laws and regulations that come out of Austin are often aimed at conservation but the City is responsible for enforcement. Somewhere between Austin and Dallas on I35, water conservation falls off the truck.

The City can put in place its own policies and ordinances and they have. There are limits as to when you can sprinkle...(all night every night). Unless you hand water or use soaker hoses...you can do that 24 x 7. And, to really put the fear in the citizenry you absolutely aren't allowed to water during rain or freezing weather.

On the incentives side, the city has some programs to help conserve water. First, their biggest program, you can get $90 to change out your toilet out for a low flow one. From the City's web site...

"Water conservation is a major component of the City’s long-range water supply plan. Our goal is to save 3.5 billion gallons over the lifetime of the 20,000 toilets replaced in the next five years through this program. "


Now that means they are going to save 175,000 gallons per toilet. I will be generous and allow two gallons a flush savings. That single toilet will have to flush 87,500 times in its lifetime to save that much water. If you figure five flushes a day that's about 48 years. 10 flushes (twice our amount), 24 years, or, 20 flushes a day (a family of five home all day with one toilet?) for 12 years!

Of course we have to assume they won't remodel or upgrade that toilet again later.

Now take my sprinklers. I have saved 51,000 gallons in seven months. I will surpass the toilet's lifetime savings in 17 months. In fact, at that rate, in 24 years I will have saved the equivalent of 12 toilets. For us personally, we each use the toilet five times a day and flush less, with two toilets. That means my five flushes a day toilets, upgraded, would take 48 years each to meet the 175,000 gallons city target.

At that rate I will have saved 24 toilets worth of water. My savings cost around $2000. The same toilet saving will cost the city $2,160 and the homeowners around $100 each to install and another $100 average to purchase because cheap toilets don't qualify for the rebate. That adds another $4800, so $6,960 total, about three times my cost per gallon. And of course that doesn't include the administrative costs for the geniuses at city hall to run this program.

You should also bear in mind all those removed toilets are land filled.

Bottom line - upgrading your toilet is a good thing. After about ten other things that have a lot better ROI and water savings potential. The City is almost preying on unsuspecting water consumers who want to be water conscious by leading them to believe this is a good first step. It's not.

So fix your sprinklers, lower the pressure, put in new multi-stream nozzles, get an ET controller, add drip when redoing beds. Inside the home, add flow regulators to showers, change all the aerators on all the faucets, stop drips and flush a little less. You'll save a lot more water and money than calling your plumber to install a new low-flow toilet.

And, for you do it yourselfers out there. Changing out a toilet is relatively easy. A leak however from the connection to the wall, the valve, the tank, etc, can all be catastrophic. There is nothing to safeguard you from flooding your house during a simple weekend trip away. (And they always break when you're away.)

Saving a LOT of money

I just returned from Oklahoma City and an overnight stay at my brother in law's house. He installed central AC about 9 months ago and I was anxious to review their electric bills. (Is that weird or what?)

The bottom line is, going from window units to central AC will save them 55% on their energy costs and pay back the initial investment in 13.5 months. That's impressive.