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Energy Crisis Environmental Economic National Security
Informed Voter Impact to ChE Job Market Informational, not Persuasive
Energy Policy Leadership
New Deal or Space Race situation Business as usual without the right
leadership
President Bush’s Plan
Unveiled at 2006 State of the Union
Advanced Energy Initiative (AEI)
22% increase for clean tech Fuel for vehicles Power for homes/business
American Competitiveness Initiative (ACI)
Over 10 years $50 billion for R&D funding $86 billion for tax incentives
AEI Goals
Vehicles 40 mile range solely on battery Cellulosic ethanol competitive with corn-
based by 2012 H2 fuel cell available to public by 2020
AEI Goals
Homes and Businesses Complete $2 billion commitment to clean-
coal, bring to marketplace Global Nuclear Energy Partnership to
address spent fuel, proliferation, work on new tech
Improve solar pv cells to be competitive by 2015
Expand access to wind energy
Twenty in Ten
Reduce gasoline usage by 20% in ten years (2017) 35 billion gallons of renewable and
alternative fuels Corn ethanol, cellulosic ethanol, biodiesel,
methanol, butanol, hydrogen, other alternative fuels
8.5 billion gallons saved by fuel economy regulations Improvement in 2010 to 2017
Bush Accounting of Alt. Fuels All fuels are treated equal on
a per volume basis, except diesel gets a 1.5x credit.
32 billlion gal / 213 billion gal projected = 15% reduction
5 years behind schedule according to DOE projections
CreditEtOH- Corn 15EtOH-Cellulosic 7.2EtOH- Import 3EtOH- Other Feedstock 0.5BTL diesel 2.9 4.35Biodiesel 1.3 1.95Total 32 billion gal
Quick Check
(32 billion gal gas)(125000 BTU/gal) = 4e15 BTU
(25.7 billion gal EtOH)(84000 BTU/gal) = 2.1e15 BTU (2.9 billion gal BTL)(128000 BTU/gal) = 3.7e14 BTU (1.3 billion gal Biodiesel)(128000 BTU/gal) = 1.7e14 BTU Total = 2.7e15 BTU / (125000 BTU/gal) = 22 billion gal gas
replaced
22/213 = 10% reduction
Fuel Economy
Current avg = 20.2 mpg Improve to save 8.5 billion
gal gas 8.5 billion gal/213 billion gal
= 4% (not 5%?) New mpg =
(20.2 mpg)(213 billion gal) 213 billion gal – 8.5 billion gal
= 21.0 mpg Federal policy needed?
Congress Acts
Changes fuel economy standard to 35 mpg by 2020.
Gas saved =213 billion gal – (20.2 mpg/35 mpg)(213
billion gal)= 90 billion gal saved, a 40% reduction
Alternative fuel policy stays the same “Twenty in Ten” becomes “Fifty in
Fifteen”
Bush’s Last Energy Policies… Off shore drilling Oil shale
1.5 trillion barrels in CO, UT, WY basin ANWR Refinery projects
149 refineries, none built in last 30 years Speed up governments review of
improvements
Obama and McCain
Originally focus of talk, but limited numbers available
Campaign promises vs. actual policy…? Latest poll statistical dead heat
Cap-and-Trade Program
Cut emissions 80% below 1990 level by 2050
Auction 100% of credits, everyone pays
Cut emissions 60% below 1990 level by 2050
Phase in auction over time, relies on past emissions distribution
Obama Supports McCain Supports
Cap-and-Trade
Government sets a cap on total emissions of CO2
Companies/groups issued credits which give the right to emit a certain amount
Trading occurs by over-polluters buying from under-polluters
Government uses some/all revenue to fund Energy Policy
Issues include enforcement and allocation of credits
Off-Shore Drilling
Maybe would consider as part of comprehensive plan
Calls for lifting ban of Outer Continental Shelf
Immediate price relief
Obama Reluctant McCain Supports
Production from Off-Shore Drilling Commercial production estimated to start in 2013
(locating and developing wells) assuming legislation passed today
Estimates of production from 200,000 (Energy Information Administration) to 1 million barrels a day (Oil Industry group)
Taking best case scenario, 1 million barrels would increase world’s daily supply 1%
Over long term, a standard economic model shows a 1% increase in production yields a 3% decrease in gas price, assuming others don’t cut production to maximize profits
$4 gal of gas reduced to $3.88 Worth the risk?
Fuel Economy Standards
4% mpg improvement per year
1 million plug-in hybrids by 2015
$7000 tax credit All new vehicles flex fuel
by 2012
More effectively enforce current mpg standards
$5000 for carbon-neutral, graduated for lower emissions
Calls for more rapid change than current 50% flex fuel by 2012
Obama McCain
Nuclear Power
Should explore, but not a great option Safety Storage Big government subsidies
Want 45 new plants by 2030 Ultimately increasing to 100
new plants Best reactors in US produce
about 10 million MW-h annually
100 plants @ 10 MWh = 1 billion MWh
1/4.2 = almost 25% of 2007 total electrical generation
Obama Opposes McCain Supports
Other Policy Highlights
Total investment of $150 billion over ten years Bush spent $15 billion in eight years
10% of electricity from renewables by 2012, 25% by 2025.
Clean coal, Smart Grid, Alaka Pipeline
Weatherize 1 million homes annually
60 billion gallons advanced biofuels
$300 million prize to improve battery technology for transportation- 30% current cost
$2 billion annually for clean coal
Tax credit equal 10% of wages spent on R&D
Obama McCain
Pickens’ Plan
DOE says 20% of power can come from wind, cost $1 trillion
This could replace natural gas in electrical production
Use domestic natural gas for transportation fuel to replace foreign oil
Accounts for 38% of imports, saving $300 billion annually
Conclusions
Once in office, much more accountable for realistic policy
Between two current candidates, Obama has put forth more details thus far
Both promise more $$$ than currently used
References
http://www.whitehouse.gov/ http://www.energy.gov/news/ http://www.nsf.gov/statistics/infbrief/nsf08312/ http://www.eia.doe.gov/basics/quickoil.html http://www.eia.doe.gov/ http://www.barackobama.com/pdf/
factsheet_energy_speech_080308.pdf http://www.johnmccain.com//Informing/Issues/ http://www.grist.org/candidate_chart_08.html http://www.eppo.go.th/ref/UNIT-OIL.html http://www.slate.com/id/2197283/ http://www.nei.org/ http://www.pickensplan.com/