Saturday, January 31, 2015

Who Knows What Oil Price Will Be?

Several months ago I had a telephone conference call will some folks who know quite a bit about energy.  Oil prices were around $100 per barrel then.  The gurus told me that big money was betting prices would drop to $70 a barrel and I reported this to my client in the energy business.  I did expect a drop in oil prices, but never imagined how far down it would go.

I am not a fortune teller but at this level of oil price many fortunes have been lost and many companies may see shutdown of their production.  Big Oil Companies like BP, Exxon, Chevron, and Shell have slashed budgets.  Russia is reeling and the American motorists are smiling while filling up at the pump.   Boom towns in North Dakota may just empty and Texans may not boast as much.  But what will happen is that cheaper oil will mean more added carbon in the atmosphere. 

Everyone knows now that biofuels from cellulose were a thermodynamic pipedream and a myth.  The US produced less than 1,000,000 gallons of cellulosic ethanol in 2014.  Perhaps we will produce as much as 10 million gallons this year with new plants that started up in Iowa and Kansas.  This is a drop in the bucket.  Vinod Khosla and the VC who bet their money and took taxpayer money for these bio fool pipe dreams did not succeed in making OPEC weaker, they just proved that the laws of thermodynamics rule.  A company called GEVO that I said would get the heave ho is now trading at 13 cents a share.  It once traded for $25 a share.  KIOR once had a market cap of over a billion dollars now it is worthless.

Bigger cars and trucks will sell more as motorists now think $2 a gallon gasoline is here to stay and the whole cycle of waste will repeat itself till gasoline goes back to $4 a gallon.  Then we will say Houston we have a problem. 

I wish I could tell you all that we have a real plan on what to do to start to lower carbon emissions in a real way but each time we make a little progress, OPEC or some other group comes up with a way to manipulate a market and cause massive economic and ecologic dislocation.  The world just runs that way.  Greed and Fear drive markets.  Thermodynamics is different it does not depend on greed or fear it just makes entropy increase as time progresses.  The rule that time progresses in the direction entropy increases is never going to change so we just have to look forward to a more disorganized future.  We can all wish it will be different but it won’t.  That is why I cannot tell you where oil prices are headed.   I just drive as little as possible and hope that the Super Bowl is a close game.  I am sure there is statistician somewhere who can correlate a NFC win with low gasoline prices.  My head is spinning and I cannot even pretend to tell you what gasoline will cost in February 2015.  

Just like watching the Super Bowl, the Green Machine is a Spectator when it comes to predicting energy prices.

Saturday, January 24, 2015

Nat Gas Plus Wind and Solar A recipe For Success

There are many who think shale gas is bad.  I do not!  There are many who think PV and wind power generation are bad.  I do not.  Of course wind and solar still receive subsidies and sometime the solar cells are placed in locations with little sunlight over the year but inherently both wind power and solar power if properly located can generate significant amounts of energy for the grid.  My solar project in the Atacama desert of Chile dispatched 270 gigawatt hours of power in a year from 100 MW of peak capacity (>30% capacity factor).  Of course in upper New York State or Ontario Canada the same cells will be lucky to dispatch 40% of this amount of energy (12% capacity factor).

The real reason that the grid can take more and more PV and Wind generation is that shale gas has lowered the cost of natural gas significantly ($10 per million BTU to $3 per million BTU) and gas fired power stations can run and provide the grid stability from spinning reserves and what are called ancillary services.   Had natural gas remained expensive then dirty coal power stations would need to generate power for the grid and also provide the spinning reserves.  Now natural gas fired station do the job more and more.

Therefore one has to come to the conclusion there is a good and symbiotic relationship between shale gas and the renewable energy from PVs and wind.  I discussed this a little as a hypothesis back in 2003 when I wrote my book on energy and sustainability Hydrogen Hope or Hype?

Of course in 2003 both wind and PV were more expensive but the book did contemplate an improvement in cost due to a “Moore’s” type law of learning for these technologies.   The book showed an acre of land can yield approximately 10,000 kwh of energy per year if dedicated to corn ethanol, 100,000 kwh per year if dedicated to wind (the land can still be used for food), and 1,000,000 kwh per year if the land was covered in PV cells.  The efficiencies of the wind turbines (larger and better blades, taller, better gear boxes, etc.) have probably gone up by 50% since the time the book was written.  The efficiencies of the PV cells have also increased approximately 50% since the book was written.

The book also foretold that fuel cells would be a Betamax technology.  Technologies that would remain expensive, and would not become widely adopted.  Wow I was correct!    The book foretold of the wonders of LED lights and flat panel displays, again brilliantly spot on.   The one hoped for technology in the book that did not materialize was the lower cost production of Titanium metal from Titanium Dioxide (found in sea sand).  This technology has made no progress and Titanium remains very expensive.  Had inexpensive titanium metal become available cars and airplanes could have been lightened and nuclear waste could be safely stored in drums made of Titanium.  Cambridge University in the UK was working on the Titanium from TiO2 process in 2003 but they simply hit a brick wall. 

I have Titanium frames on my spectacles, but I still have a 1999 C 280 Mercedes made of heavy steel.  Gladly the PV cells, the wind turbines, and the methods to improve shale gas production saw wonderful improvement since I bought my car in December 1998.  Mercedes makes such a fine German car that I will hold onto it until the Brits finally succeed in making inexpensive Titanium.

Saturday, January 17, 2015

What a Week In Thermodynamics

The laws of thermodynamics came heavily into play this past week.  The State of Mississippi sued KIOR and their sponsor Vinod Khosla for fraud.  Yes thermodynamic fraud no less.  The gangrene fake company claimed to make copious amounts of liquid transportation fuels from pine trees when in fact they did not and could not.  That is the essence of the fraud lawsuit.

Also named in the suit is one Samir Kaul who is Vinod’s bag handler.  The CEO Fred Cannon and board member Fred Whitlock are also named.  If I was filing the suit, I would have named a few other board members who signed off on the S1 when KIOR had its IPO.

I would name one Jagdeep Singh Bachher who represented AIMCO the Alberta provincial pension fund that is a large shareholder and bond holder in KIOR.  Jagdeep was in Deep with Vinod Khosla and his thermodynamic fraud.  He signed off on the fraudulent S1 that brought KIOR public.  Jagdeep is also in Deep in the Bloom Energy BLOOMDOGGLE the other massive greenwashing fraud.  Jagdeep now is the the Chief Investment Officer for the University of California pension fund.  I have asked the UC Board of Regents to put him on administrative leave while they investigate his hiring to this prominent position.  Jagdeep is simply too close to fraudsters to handle the UC pension fund.

The other person I would name is one John Melo the CEO of Amyris (AMRS).  Amyris is another another failing green company that Khosla backed together with Kleiner Perkins of BLOOMDOGGLE fame.  Melo was another board member who signed off on the S1 knowing the S1 was thermodynamic fraud.  Both Bachher and Melo resigned from the board in 2012.  Melo resigned in February 2012.

Bachher resigned in June 2012
The S1 was filed in April 2011 and the IPO of KIOR took place in June 2011.  Luckily for Condi Rice she became a director of KIOR after the S1 was filed.  She should have read the S1 and never joined the board, but I cannot accuse her of concocting the thermodynamic nonsense in the S1 that help defraud the public.

OK now we have the players and we have a civil suit brought by the state of Mississippi.  If Vinod and his henchmen pay big time, something like $100 million, the state may settle and then not bring criminal charges.  If Vinod and his buddies do not settle for big money, I think criminal charges should and will be brought by the Magnolia State.  The SEC may bring civil and may bring criminal charges against Khosla and his clan.  When Khosla and his buddies settle I bet part of the settlement is that the Feds do not bring any further charges against the thermodynamic fraudsters.

I have also asked the New Zealand Superfund who are “partners” with Aimco to divest of two multimillion dollar holding they have with Khosla and Kleiner Perkin related companies.  The first being the $100 million US holding in Bloom Energy the BLOOMDOGGLER where both Khosla and Kleiner Perkins are backers.  The second being the $60 million US holding in Khosla’s company LanzaTech.   Khosla once “worked” at Kleiner Perkins and is still listed as a “Partner Emeritus”.  For the umpteenth time I am asking Tony Blair and Condi Rice to distance themselves from Khosla and for the umpteenth time I am asking Collin Powell to distance himself from Bloom Energy.  The three former high level politicians should stick to their knitting and that is to find weapons of mass combustion.  They simply will never be able to tell us their partners who they provide “strategic advice” are good and green when in fact their clients are vile and gangrene.

I did attend Dr. Chu’s talk at the Marin Civic Center on Thursday.  I actually found him to be witty and entertaining.   I will blog about his talk probably tomorrow.  He had some interesting data on the cost of PV cells and the cost of batteries for EV vehicles.  He loves Tesla but admitted they simply did not deliver the people’s electric vehicle that was the basis for the DOE loan that did get repaid early and in full.  Dr. Chu and another prof at Stanford are researching less expensive and less heavy batteries than the ones inside a Tesla.  Dr. Chu knows heavy, weak, and expensive batteries are what kills an electric car.  Mississippi knows that a ton of yellow pine could not yield 92 gallons or even 72 gallons of liquid transportation fuel.  That is what killed KIOR and may still put the Khosla clan in jail.

Monday, January 12, 2015

Kior Old Miss Versus Khosla

A battle is brewing in bankruptcy court in Delaware over whether the end of KIOR should be by 7 or by 11.  The State of Mississippi wants the bankruptcy judge to rule that death penalty should be via Chapter 7.  Khosla the thermo clown wants to drown using Chapter 11.  Why the disagreement?

Old Miss thinks Vinnie is about to pull a fast one on the few remaining assets of the gangrene company. 

I actually think this is the first of many actions by the state and in the end the Magnolia State may bring some criminal charges against KIOR, its officers, directors, and it promoters for fraud.   No doubt the whole story was a thermodynamic fraud and I have opined on this for several years.

The SEC has KIOR under investigation. 

Robert Rapier called their demise.

The next few days will be really interesting.  I do hope the State prevails and we see the dog enter cage number 7 where it belongs prior to being put down.   The State of old Miss may have cages for a few humans as well.   Do they have chain gangs in old Miss?  The end of KIOR could be like Cool Hand Luke. 

The failure to communicate here was that a short ton of the yellow pine simply could not yield 92 gallons of diesel.  The pine became, soot, CO2, water, and an oily mess.

Sunday, January 11, 2015

Obama is no Charlie


An Easy as Pi Solution To End the Delaware BLOOMDOGGLE and Make the Streets of Wilmington Safe

The following was sent to the President and the Editor of Delaware's leading newspaper The News Journal (Gannett) 

I suggest the following be published as an Op Ed in your paper as a real idea from the Green Machine to improve law and order on the streets of Wilmington as well as clean up the air and the dumps with solid hazardous waste.  My idea that is as easy as pi "kills" three birds with one stone.

Here is my Op Ed.

An Easy as Pi Solution To End the Delaware BLOOMDOGGLE and Make the Streets of Wilmington Safe

My suggestion:

By March 14, 2015 at 9 am (314159 or 3.14159 =pi) the new AG of Delaware, Mr. Matt Denn, should announce the opening of  an investigation into the fraudulent granting of a permit for the Red Lion Project in the coastal zone of Delaware for the Bloom Boxes that irrefutable written evidence now shows the extraction of enormous subsidies and the massive unpermitted pollution of land and air in the generation of unreliable electricity.

The BLOOMDOGGLE rip-off is equal to at least $1000,000 a day in Delaware.  My solution will be that DELMARVA collect the $100,000 subsidy, but give this to the AG office for real prevention of the further deterioration of downtown Wilmington.   Thirty real police officers can be hired for $20,000 a day.  The remaining $80,000 a day can be used to improve the roads, street lights, buildings, and general infrastructure of Delaware’s largest city.

The Bloom coffins should be removed from the Coastal Zone and the Red Lion site should be restored to its natural state in the protected coastal zone.  The officers, directors, and major shareholders of Bloom Energy should be indicted and face trial.  Civil servants and cabinet secretaries should also be indicted for their roles in the BLOOMDOGGLE.  Delmarva Power (Bloom’s agent) and Bloom should pay over $100 million in restitution for the crimes against nature and humanity.

This would show the poor in Wilmington that they do have hope of a fair future with proper employment opportunities and equal justice under the law.  Sadly the AG and Mr. Alan Levin the remaining cabinet secretary who signed off on the bogus tariff have a hopeless plan to bring the “rule of law” and a sense of security to the streets of Wilmington.  Note Mr. Colin O’Mara the other cabinet secretary who signed off on the bogus tariff resigned after his role in hiding solid waste with sulfur from the Bloom coffins was exposed.

The following article outlines Mr. Denn’s and Mr.  Levin’s plan for “safety ambassadors” dressed in yellow jackets (why not green jackets?) to save the downtown. 

I happen to think my plan with the $36 million a year used now for fraudulently transferring money from Delmarva ratepayers to Bloom would work better.  I bet 99% of the ratepayers would prefer the money be spent for law and order in downtown Wilmington rather than making Al Gore, John Doerr, and Colin Powell richer.  My plan would clean up the air, the solid hazardous waste dumps, and the streets.  My plan that is as easy as pi will work.  Mr. Denn’s plan won’t work as 99% of people know almost $70 million has already been given in subsidy to the 1% who own Bloom Energy and why would a few “safety ambassadors” change that.  One good law suit from the AG’s office will send the right message to the streets of Wilmington and all other streets in Delaware that crime does not pay!

I do hope you publish this Op Ed

Lindsay Leveen
The Green Machine

Saturday, January 10, 2015

What a week!!

First I need to take a moment of silence to pay tribute to the French and their police and army.  Today we are all French.

Inside EVs dot com reported the yearly sales of plug in cars.  119,710 such cars were sold in the USA in 2014.  Many new brands came to market with 22 vehicles to choose from.   In 2013 there were 16 vehicles to choose from and 97,507 vehicles were sold.

It looks like a “growth” market on the surface but when one looks at the three market leaders (Leaf, Volt and Tesla) the growth was anemic at only 4.5% year on year growth (68,339 vehicles versus 65,387) and two of the three (Tesla and Volt) each selling fewer vehicles in 2014.

When the battery size is added to the equation for the three market leaders the growth in kilowatt hours of battery packs was only 3.3% year on year.  Mr. Obama promised a million plug in vehicles on the road by the end of the year and we all know that was wishful thinking.

OK we all know that Dr. Chu was a run a way Chu Chu and wasted billions of dollars so let’s get back to the EVs and the market leader The Nissan Leaf.   Nissan received $1.4 billion in DOE loan guarantees on the promise they would produce 150,000 Leaves per year.   The Leaf has been on market for four years and 1 month.  In that entire time they sold 72,303 or about half of what they promised for one year.    This is a fulfillment of one eighth of a promise!  Kind of like getting one year of work out of Mr. Obama in two terms.

At least the leaf got 72,303 cars on the road.   AC Transit got 12 fuel cell busses on the road powered by hydrogen.  The cost to taxpayers and ratepayers for the program so far is $87.6 million.  Now the zinger the busses have only traveled 526,000 miles (AC Transit Report 14-013 of March 2014).   I wrote the following to Denise Standridge the General Counsel of AC Transit:

“The real cost per mile is $87.6 million divided by 526,000 miles which equals $166.54 per mile.  The CO2 saved per mile is probably no more than 5 pounds even if all the hydrogen is made from renewable resources and the diesel busses attain 5.5 MPG.  Therefore, the cost of the program per short ton of CO2 saved is at a minimum $66,616.   Wow a short ton of CO2 offsets in Europe can be purchased for $7.42 per short ton (Euro 6.86 per metric ton).  This program has cost taxpayers and ratepayers 8,976 times the real value of the CO2 saved.

This project has to be the biggest boondoggle and greenwashing in the world and of course the Governor of CA gave the project his highest environmental award

I cannot even think of a Hollywood screenwriter who could dream up this nonsense!!”

Folks, the $87.6 million could have been used more wisely.  The $1.4 billion loan to Nissan could have been used more wisely.  I am convinced that the US needs an Engineering General just like an Attorney General and a Surgeon General to bring Real Energy Policy to the country.  Else, we will continue to have Presidents making outrageous statements about electric vehicles and hydrogen vehicles. 

Talking of vehicles I filled up with midgrade in Marin County California for $2.43 a gallon.  It took me 4 minutes and I did not have to have Elon Super Charge me, I already was super charged by Governor Moonbeam who gave AC Transit an environmental award of the highest level for their BLOOMDOGGLE.  If Moonbeam had his way AC Transit would switch to DC Transit and go all electric.  Welcome to California where solar cells will generate power at night using Moonbeams.  I will be writing quite a bit on AC Transit in future blogs.

Saturday, January 3, 2015

LNG – Green or Gangrene?

This blog discusses whether Liquefied Natural Gas is green or gangrene.  Natural gas is naturally a gas not a liquid – duh!   In order to liquefy the gas for easier transportation to far off markets, it is cooled to very low cryogenic temperatures and held within thermos type storage tanks.  In the process of liquefying the gas approximately 10% of the energy in the gas has to be used for the refrigeration.  The ships that transport LNG use approximately another 10% of the energy content of the gas to get the product to market.  Hence compared with natural gas in a pipeline in the USA, LNG landed in Japan has 120% of the carbon footprint.

Argonne National Labs states that the upstream production of natural gas emits 6.995 kg of CO2 per million BTU LHV and the actual burning of the gas emits 59.41 kg of CO2 per million BTU LHV.   Gas is sold on higher heating value (HHV) not lower heating value (LHV) and we use pounds in the USA.  Performing the math we have emissions of 132.2 pounds of CO2 per million BTU HHV and 146.4 pounds of CO2 per million BTU LHV for pipeline gas in the USA.  In Japan the LNG has emissions of 158.6 pounds of CO2 per million BTU HHV, and 175.7 pounds of CO2 per million BTU LHV.

The delivered price of natural gas at Henry Hub in the USA is approximately $3 per million BTU HHV.  The delivered price of LNG with the same heating content at a port in Japan is $12.40.  The extra $9.40 per million BTU accounts for the cost of liquefaction and the transportation of the LNG to Japan.   The Japanese and other LNG importers wish they had shale deposits and production like the USA. 

The LNG is expensive because of the complex supply chain but it is greener than burning coal or fuel oil to generate electricity.   The global trade of LNG is growing and many new liquefaction facilities are being built in countries with gas reserves.  Australia and the US are leading the charge to construct natural gas liquefaction facilities and there is also a considerable amount of activity in the LNG sector in Africa.  However the projects are now looking less promising and certainly less profitable given that oil prices have dropped and more competition has come to the LNG market.  Two years ago LNG landed in Japan was selling for $18 per million BTU.

A project at Curtiss Island in Queensland Australia has just come on line that cost $20 billion to build with a capacity of 8.5 million metric ton per year.  This project will hardly be profitable as the capital cost of the project far exceeded the original budget.  In fact many LNG projects have seen massive cost overruns, and one project in Angola was poorly designed and built it has failed to run and has to be rebuilt entirely.  It is the poster child of how not to design and build a LNG facility.

The owners of these and other LNG facilities probably wish they had selected more competent contractors for the engineering, procurement , and construction (EPC) of the projects but they are stuck with massive investments in locations where there is stranded gas.  As the stranded gas is useless at it source, the gas will be liquefied and transported to distant markets even if the profitability of the project is not as high as expected.  Several projects that are still in planning will now probably not get built.  One casualty of the “glut” of LNG is a project in Lavaca Bay Texas, that was cancelled this week.

From a green perspective the use of LNG is far greener than fuel oil or coal, but from an owners’ perspective the word LNG may be gangrene given the billions of greenbacks these projects have overrun and the many billions of expected profit that will not materialize.  Future LNG projects will get far better management of the EPC contractors, and Chevron has promised its shareholders to do exactly this after the Angola LNG debacle.

My early career was spent in LNG and cryogenics so there may be a role for the green machine to help owners select and manage EPC contractors to yield better project results.  I think LNG is green and I have always said the best method to generate electricity that is fully dispatchable and affordable is using natural gas in a combined cycle power station.   Had Delaware and California not wasted money on Bloom Boxes and had they built combined cycle natural gas power stations the ratepayers in these states would be far happier and better served.   It is quite amazing how much money was wasted on mismanaged LNG projects and on Bloom Boxes.  In the end just like Chevron, we hope that public utilities commissions in Delaware and California also learn some lessons.  God knows how hard I have tried to teach them. 

Thursday, January 1, 2015

The Greenest Thing of 2014

2014 has come and gone and lots of energy news happened in the year with oil prices collapsing at year end.  Tesla sold fewer vehicles in the USA in 2014 than they did in 2013, therefore they were not even closest to the greenest thing in 2014. 

Even through the deal Mr. Obama signed with China was touted as being green it hardly was.  The US emitted more CO2 than it did in 2013 and will likely emit more CO2 in 2015 than in 2014.

So what was the greenest thing of 2014?

I have to give the award to LED.  Yes Light Emitting Diodes helped the world emit less CO2 while providing more lumens to a world that otherwise is in utter darkness.  The Nobel prize in physics was awarded to three scientists of Japanese descent who helped invent the LED.

This was a well deserved award of the prestigious prize.  In my book Hydrogen Hope or Hype? written 11 years ago I predicted the LED would be a world saving technology.  At that time traffic lights were being converted to use LEDs rather than incandescent bulbs.    I suggest you all buy the E Book version of my book it still is the best primer on energy and sustainability that has been written.  Here is a link to the book.

If you read the book you will understand that in all probability the Toyota Fuel Cell vehicle will not win any Nobel Prize in physics and will hardly make a dent on GHGs.  Toyota needs a decoy for the tens of millions of ICE cars it sells and the Mirai is actually a green Mirage to deflect future tobacco company type lawsuits that Toyota and other automakers may have to defend.   The Mirai is window-dressing not a LED type world changing invention.

Dr. Moniz posts on Facebook and I often comment on his posts.  I wish he would comment on LEDs and not some nonsense like the Kemper power project that he hyped when all know this is a boondoggle that cost taxpayers and ratepayers billions.   Dr. Moniz also touted Ivanpah on his FaceBook page and we all know that Ivanpah has proved to be Solyndra times three. 

As a footnote to 2014 my friend’s 1.557 megawatt PV project in the Bronx New York generated 1,733 megawatt hours in 2014.  There are 8,760 hours in a year and performing the algebra the Bronx NY PV system had a capacity factor of 12.7%.  Dr. Moniz and the Governor of New York should take note of the attainable capacity factor for roof mounted PV in New York.   I had predicted my friend’s project would have approximately 12.6% capacity factor when he told me he was going to embark on it.  My friend was green but he would have been far greener if his warehouse was located in the Atacama Desert of Chile.  

Of course my friend should install LED lights in his large warehouse.   Cree the leading LED manufacturer is now selling common commercial lights that emit approximately 100 lumens per watt.  Cree also has LEDs in development that emit 300 lumens per watt.  Using the 100 lumens per watt that my friend’s 1.557 megawatt PV system can produce at peak, he can install 155.7 million lumens of lighting in his warehouse with the basic Cree bulb.  The ball that dropped on Time Square in NY was also illuminated using LEDs.   The ball has 672 LED modules and a total of 32,256 LEDs that were manufactured by Phillips not Cree.    There is no doubt that LEDs are great and my congratulations go out to the three physicists who won the Nobel Prize.  I say OMEDETOO GOZAIMASU to them.