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Alternative Fuels for America
www.caranddriver.com ^ | 8-1-2010 | BY CSABA CSERE

Posted on 08/09/2010 8:45:02 AM PDT by Red Badger

Instead of a wholesale switch to electric cars, with all their inherent range and charging problems, a seemingly easier way to wean ourselves off gasoline is to find alternate fuel that could be used in slightly modified internal-combustion engines. Unfortunately, there are some very real reasons—never mind what conspiracy theorists might tell you about oil companies and corrupt government officials—why most alternative fuels are not ready for prime time yet. Here’s a look at the current status and near-term future outlook of the major alternatives to gasoline.

Modern turbo-diesels get about 30 percent better fuel economy than their gasoline counterparts, have gutsy low-rpm torque, and work well in vehicles with automatics and for towing; they’re a seemingly perfect solution for the U.S.

Unfortunately, diesel emissions are far dirtier than gas emissions. Removing diesel’s pollutants requires costly pieces of emissions equipment. Diesel also requires approximately 30,000-psi fuel-injection systems. These costs make diesels more pricey than even turbocharged, direct-injection gasoline engines, and those gas engines have the potential to achieve about two-thirds of diesel’s fuel-economy advantage.

While diesel costs about the same as gas today, it has run as much as 30 percent higher—and it is taxed at a higher rate than gas. There’s no easy fix to keep diesel prices low, relative to gas, because American refineries, in general, produce about 19.5 gallons of gasoline and 10.3 gallons of diesel from each barrel of oil. That means a gas-powered vehicle getting 20 mpg can drive about 390 miles on a barrel of oil, while a diesel, at 26 mpg, can go only 270 miles.

Since a barrel of oil doesn’t go as far in a diesel car, a wholesale conversion to diesels is unlikely in America unless we suddenly figure out how to make diesel fuel from something other than petroleum. European refineries produce more diesel and less gasoline from each barrel of oil, but making that switch would essentially require building brand-new refineries. Don’t hold your breath.

One approach is to transform animal fat or vegetable oil, via a transesterification process, into what is called “biodiesel.” The resulting fuel doesn’t contain sulfur and can be used in pure form, though many vehicle manufacturers recommend that it be blended with petroleum diesel in proportions between 5 and 20 percent. Biodiesel contains about 9 percent less energy than petroleum diesel, but it has a higher cetane rating (which promotes more-efficient combustion) and better lubrication properties.

Despite America’s appetite for french fries, there isn’t enough used cooking oil to make very much biodiesel. In fact, it has been suggested that to replace all of our petroleum needs with biodiesel would require the planting of soybeans on all of the arable land in the United States. New approaches for making biodiesel from algae are being explored, but they are likely decades away from mass production. Until then, biodiesel’s limited availability and higher cost will keep it a bit player.

Another diesel alternative is synthetic diesel, made by a variety of chemical conversion processes that transform natural gas, methanol, or coal into diesel. The resulting fuel is usually sulfur-free and has a higher energy content than petroleum diesel, plus cleaner exhaust emissions. Converting natural gas to diesel fuel, also known as “gas-to-liquid,” makes it easier to transport because it requires no refrigeration or compression.

The cost of synthetic diesel is also reasonable, although the environmental and energy-independence benefits are minimal. Converting coal to diesel creates much more carbon-dioxide emissions than simply using petroleum diesel. In fact, this is a problem, in varying degrees, with any of the synthetic-fuel processes. However, North America has plentiful natural-gas reserves, and this could be a simple way to convert it into an easy-to-use motor fuel.

The use of E85, which mixes 85 percent corn-based ethanol with 15 percent gasoline, has stalled due to the fuel’s limited availability, high price (no thanks to our government’s tariff on E85 imports), the roughly 30 percent fewer miles to the gallon it gets, and the understanding that its use provides little in the way of carbon reduction if the energy required to grow the corn and turn it into ethanol is factored in.

Brazil, a country that achieved energy independence by using home-grown ethanol, makes the fuel from sugar. Starting with corn is a much more complex and energy-intensive process. In the U.S., sugar-based ethanol would be challenging because most of our land is unsuitable for sugar production.

If we could produce ethanol efficiently from easier-to-grow plants, ethanol would be a good solution. Dubbed “grassoline,” this ethanol is produced from tall prairie grass or even algae. Several projects to develop a workable process are under way, but commercial quantities won’t appear before 2020.

A more readily available alternative fuel is compressed natural gas (CNG). Converting a gasoline engine to run on the same stuff most of us use to heat our homes is an easy, low-cost approach. Natural gas is also cheap, and America has a lot of it. And natural gas contains far less carbon than gasoline. In fact, a normal engine running on CNG almost matches a plug-in hybrid for its carbon-dioxide emissions. The price of CNG for the energy equivalent of a gallon of gasoline is less than a dollar (before taxes).

Still, automakers are reluctant to embrace CNG because it emits some pollutants, while a hydrogen car or an electric vehicle does not. Also, since it must be compressed to 3500 psi to get enough of it into a tank to provide a decent range, CNG requires cylindrical Kevlar tanks that are heavier, more expensive, and harder to package than normal gas tanks.

Hydrogen is the holy grail of synthetic alternative fuels. Whether burned in an internal-combustion engine or used to power a fuel cell, its primary byproduct is water. And with that emitted water, you can produce more hydrogen. Of course, it’s not as easy as it sounds.

Most commercial hydrogen produced today is made by stripping carbon atoms from natural gas—a fossil fuel. The removed carbon atoms then hook up with oxygen to release carbon dioxide into the atmosphere. If you work through the losses in the process, it would be cleaner, easier, and cheaper to simply burn natural gas in an internal-combustion engine.

Hydrogen, in its gaseous or liquid form, isn’t easy to store or transport. The network of pipelines that currently moves natural gas around the country is too porous to keep the tiny hydrogen molecules from escaping. In automobiles, hydrogen has to be stored in stout cylindrical tanks and compressed to between 5000 and 10,000 psi.

Creating hydrogen using solar, hydroelectric, or wind power are pollution-free solutions, but solar cells, wind turbines, and hydroelectric dams aren’t free. Until we come up with a cheap, large-scale, and pollution-free method of generating electricity so that we can produce hydrogen from water, the widespread use of hydrogen as a fuel seems unlikely.


TOPICS: Business/Economy; Culture/Society; Miscellaneous; Technical
KEYWORDS: biodiesel; cng; diesel; energy; ethanol

Rest In Peace, old friend, your work is finished.....

If you want ON or OFF the DIESEL ”KnOcK” LIST just FReepmail me.....

This is a fairly HIGH VOLUME ping list on some days.....

1 posted on 08/09/2010 8:45:05 AM PDT by Red Badger
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To: sully777; vigl; Cagey; Abathar; A. Patriot; B Knotts; getsoutalive; muleskinner; sausageseller; ...

Knock Ping!...........


2 posted on 08/09/2010 8:45:46 AM PDT by Red Badger (No, Obama's not the Antichrist. But he does have him in his MY FAVES.............)
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To: Red Badger

If only we could harness the power of hot-air and bullshit that are constantly flowing out of DC...


3 posted on 08/09/2010 8:47:48 AM PDT by OneWingedShark (Q: Why am I here? A: To do Justly, to love mercy, and to walk humbly with my God.)
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To: Red Badger

I’m all for privately funded research in this area.


4 posted on 08/09/2010 8:49:17 AM PDT by cripplecreek (Remember the River Raisin! (look it up))
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To: Red Badger
I'll probably take some pot-shots from the rabid environuts who visit here, but I don't think we need to replace the internal combustion engine. It is the most efficient engine they can come up with for now for the work that it does in America.

Even if a phenomenonally clean, inexpensive and plentiful power source was discovered, it wouldn't be long before the algore/chickenlittle types would start demonizing it to wedge their "fair share" of any profits derived from it.

It's not the gasoline, oil, or even cars that the lib enviro-nuts hate, it's the fact that it is in such demand that oil companies sell a lot of it, and the nuts want control of the energy sources in order to control the people.

Look around, anything that is in "demand", or necessary, (like healthcare) is what the progressives are wrapping their arms around. It's completely a control thing.

Internal combustion makes the world go round, and while the rest of the world is adding more cars and roads, the USA under progressives, wants to put us back in buckboards and stage coaches and then bitch about the horse$hi+.
5 posted on 08/09/2010 8:57:35 AM PDT by FrankR (It doesn't matter what they call us, only what we answer to....)
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To: Red Badger

I believe the long term answer to our alternative fuel is going to be provided by microbiologists. Biodiesel produced by algea or some yet to be discovered organism fed by the sun.

Personal transportation shouldn’t take more than a 3 cylinder turbo diesel. Made well, should haul you around for 500K miles or so.


6 posted on 08/09/2010 9:02:12 AM PDT by IamConservative (You older gentleman ever sit on your testicles? WOW, that hurts!!)
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To: Red Badger
Its really difficult to understand the reluctance to promoting and using CNG (natural gas) especially considering how plentiful it is right here in the USA.

Back in the 50’s and 60”s I remember many people using CNG or propane powered cars, pickups and tractors. Other than difficulty in finding refueling stations, everyone running gas powered seemed OK with it.

There is something in the picture that is hard to see, it is WHY.

7 posted on 08/09/2010 9:04:34 AM PDT by dusttoyou (Let the other side get all wee-wee'd up, Remember come November)
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To: Red Badger

The miles per barrel comparison is very misleading. The are using the average gasoline/diesel production and portraying it like a limit.

Those ratios are only the result of current market conditions in the US. Process units like Catalytic Crackers and Hydrotraters are designed to maximize gasoline production because the US demand is so great.

In places like Europe and South America, more diesel is produced.

Brazil (Petrobras) is currently in the early engineering phase of two new refineries that will produce no gasoline and maximize diesel production. My company is being evaluated to provide some of the technology.


8 posted on 08/09/2010 9:22:21 AM PDT by thackney (life is fragile, handle with prayer)
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To: IamConservative
Go Algae GO!

Even the great Satan Exxon is going algae, why drill when you can pond scum(they can relate).

Fuel a movie I just returned to Netflix, explains much of this and more( by more , one example is some rare footage by one of the camera people of the Twins exploding, yes, they exploded).

In the meantime, good old hemp seed oil returns mucho BTU to our piston powered chariots for cheap, cheap cheap.

It also improves the soil.

Beside clean cheap power, the seed oil has the perfect amino acid profile for human nutrition.

They say the Bible says this in so many words.

9 posted on 08/09/2010 9:48:43 AM PDT by norraad ("What light!">Blues Brothers)
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To: FrankR
Even if a phenomenonally clean, inexpensive and plentiful power source was discovered,...

It already has. It's called nuclear power....................yes, you can power a vehicle with nuclear power............

10 posted on 08/09/2010 10:08:24 AM PDT by Red Badger (No, Obama's not the Antichrist. But he does have him in his MY FAVES.............)
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To: IamConservative

Diesel can be made from coal, which we have plenty of, as can gasoline..............


11 posted on 08/09/2010 10:10:36 AM PDT by Red Badger (No, Obama's not the Antichrist. But he does have him in his MY FAVES.............)
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To: Red Badger
Diesel can be made from coal, which we have plenty of, as can gasoline..............

The diesel would have sulfur in it would it not?

12 posted on 08/09/2010 10:13:31 AM PDT by IamConservative (You older gentleman ever sit on your testicles? WOW, that hurts!!)
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To: IamConservative

Sulfur can be removed in the process, and there are low-sulfur coals than can be used...............


13 posted on 08/09/2010 10:28:58 AM PDT by Red Badger (No, Obama's not the Antichrist. But he does have him in his MY FAVES.............)
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To: IamConservative

http://www.energyandclimate.org/synthetic-diesel.html


14 posted on 08/09/2010 10:31:29 AM PDT by Red Badger (No, Obama's not the Antichrist. But he does have him in his MY FAVES.............)
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To: Red Badger

Oh...I forgot to add “practical”...sorry.


15 posted on 08/09/2010 10:34:06 AM PDT by FrankR (It doesn't matter what they call us, only what we answer to....)
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To: thackney
Dear thackney,

The author recognizes your point, but states that to get significantly more diesel per barrel, it would require replacing all our existing refineries. What do you think of that comment?

What's implied in YOUR post is that getting as much gasoline out of the barrel as we do is a result of using EXTRA refining equipment. Could refineries be re-tooled by removing that extra equipment from the process? Or is the author not too far off?

Thanks,


sitetest

16 posted on 08/09/2010 10:41:24 AM PDT by sitetest ( If Roe is not overturned, no unborn child will ever be protected in law.)
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To: FrankR

The only two things that keeps nuclear power from being “practical” in everyday transportation are fear born of ignorance and government policies.........maybe one and the same...............


17 posted on 08/09/2010 10:45:58 AM PDT by Red Badger (No, Obama's not the Antichrist. But he does have him in his MY FAVES.............)
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To: Red Badger

There is only one fuel that will save America, fat made from boiled down liberals.


18 posted on 08/09/2010 10:46:22 AM PDT by SpaceBar
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To: sitetest
to get significantly more diesel per barrel, it would require replacing all our existing refineries

Portions of the refinery would be replaced but not the whole refinery. For example, typical Cat Crackers would be replaced with VGO units and the like but the desalter, atmospheric distillation and vacuum distillation units would be unchanged.

What's implied in YOUR post is that getting as much gasoline out of the barrel as we do is a result of using EXTRA refining equipment. Could refineries be re-tooled by removing that extra equipment from the process?

If you only removed the equipment, we would be left with a lot of low value product like residual oil (bunker fuel) that has little use and value. Instead, subsequent processing units downstream of the distillation units breakdown the low-value, high-BTU, heavy oil into more desired products. Different markets desire different ratios of products.

19 posted on 08/09/2010 10:47:13 AM PDT by thackney (life is fragile, handle with prayer)
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To: Red Badger

I was only thinking of how many of said cars Iran would buy to get the plutonium...nuclear is nuclear....


20 posted on 08/09/2010 10:47:40 AM PDT by FrankR (It doesn't matter what they call us, only what we answer to....)
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To: thackney
Dear thackney,

Then, in reality, although it would cost some pretty big bucks, it's more than doable to move more toward diesel production at American refineries.

If, over time, we were able to convert roughly half our passenger vehicle fleet to diesel, I think that’d save a million or more barrels of oil per day. Seems like a worthy goal to me.


sitetest

21 posted on 08/09/2010 10:51:36 AM PDT by sitetest ( If Roe is not overturned, no unborn child will ever be protected in law.)
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To: norraad

“They say the Bible says this in so many words.”

Who is “they”? Also, please provide book, chapter and verse to back this up.


22 posted on 08/09/2010 11:02:01 AM PDT by TexasRepublic (Socialism is the gospel of envy and the religion of thieves)
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To: sitetest
Are you confident that would be more cost effective than producing our shale-oil using the same dollars?

I think it is past time for our government to open those federal lands up to commercial activity.

I am confident Americans can match the technical expertise to make this economically producible, since Estonia, Brazil and China have been do the same for many years.

23 posted on 08/09/2010 11:14:51 AM PDT by thackney (life is fragile, handle with prayer)
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To: TexasRepublic
...every herb bearing seed, etc."

Don't know for sure, could care less, other than I realize smart people did smart things way back when and before mind control sheep herding.

Most seeds have mucho oil, hemp is just easy to grow and useful for chordage, etc..

I had a hemp shirt long ago , it was real comfy and lasted a long time.

24 posted on 08/09/2010 11:17:07 AM PDT by norraad ("What light!">Blues Brothers)
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To: thackney
Dear thackney,

I don't know why it should be either/or. I'm not sure that there's any one thing we can do with our energy sector that solves all our problems.

Which raises the question, what are our energy problems to be solved?

I guess my own view is that we should have three national energy goals:

1. Produce as much energy domestically as possible, minimize the import of energy products, especially oil;

2. Assure a plentiful supply of energy in relationship to our energy needs (which means that if we do something that reduces our need for oil by a million barrels a day, that's not far off from producing an additional million barrels a day);

3. Within the context of the first two goals, produce energy (safely) as cheaply as possible.

The reasons for the first goal are two-fold. First, to my mind, it seems to have become a national security issue. Reliance on Russian mobsters, Muslim jihadists, Venezuelan dictators, Nigerian scam artists, or even Mexican oligarchs for our energy. I believe that we are limited in our foreign policy, including how hard we can fight the war on the jihadists, because of our dependence on these turds. We would be more secure if we produced nearly all our own energy, and what we imported came from normal countries like Canada, the UK, etc. As well, if we didn't import oil from these places, they would be less important and wouldn't require strategic protection, they'd be far less wealthy, and wouldn't have the same ability to finance things against our national self-interest.

Second, a large part of our trade deficit comes from paying $70 or $80 per barrel to all these putzes. It works out to over 2.5% of GDP.

As you know, I'd be more than happy to impose a tariff on imported energy (possibly excepting energy from places like Canada), and use the money collected in tariffs to reduce income taxes, or payroll taxes, or what-have-you. Just high enough to seriously advantage domestic producers of energy (especially stuff that can run our vehicle fleet).

As to the second goal, certainly, starting a long-term push toward diesel passenger vehicles is one way to accomplish it, as is drilling here, drilling now. Everywhere in the US. Shale oil, ANWR, get into all that natural gas that's being discovered practically everywhere (you once pointed out that we have literally tens of millions of potential “stations” for CNG fueling - all the homes that use natural gas for heating).

So, I'm all for producing lots and lots of stuff - DOMESTICALLY - but I'm not opposed to reasonably straightforward (if not exactly cheap or fast) things that help us to use our energy more efficiently.


sitetest

25 posted on 08/09/2010 11:51:34 AM PDT by sitetest ( If Roe is not overturned, no unborn child will ever be protected in law.)
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To: sitetest
I keep meaning to mention this to you.

I am always impressed with your courtesy in posting. You raise the level of FreeRepublic and it encourages dialog.

26 posted on 08/09/2010 11:52:18 AM PDT by thackney (life is fragile, handle with prayer)
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To: sitetest
I don't know why it should be either/or.

It is a limitation of capital. I suspect from my experiences, more energy production would result from investing in the oil shale.

If I was building new, I would recommend more infrastructure based upon diesel. But the incremental gain versus cost of tearing out gasoline producing units for diesel, combined with the automotive infrastructure, should make the conversion to more diesel a slow process.

27 posted on 08/09/2010 11:58:21 AM PDT by thackney (life is fragile, handle with prayer)
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To: thackney

Thank you.


28 posted on 08/09/2010 12:04:55 PM PDT by sitetest ( If Roe is not overturned, no unborn child will ever be protected in law.)
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To: thackney
Dear thackney,

“It is a limitation of capital.”

I understand. Although I'd think that folks who invest in refineries want to do things to keep up their refineries. I guess the problem that I see is that there probably isn't much incentive for the refineries to do this. If refining companies decided to really try to push Americans toward diesel vehicles, in order to use the additional diesel that they would produce after retrofitting, they'd wind up selling less refined product after having made major capital improvements.

From my own view, I don't know how we might move more toward the use of diesel passenger vehicles without some government intervention. Something like a pretty sizable tax credit for purchasing a diesel passenger vehicle. I'd imagine most folks would be against that.

A long-term tax credit for the purchase of diesel passenger vehicles might significantly increase the percentage of diesel passenger vehicles over time, which would, as demand for diesel increased gradually over time, likely persuade refining companies to gradually do the necessary capital improvements to change the gasoline/diesel ratio over an extended period of time. I don't know what the depreciation schedule for this equipment is, or what the actual lifecycle is for this equipment, either. However, by causing demand for diesel to rise gradually, I imagine that some of the hit on capital investment would be ameliorated, since companies would have to invest in replacing/upgrading equipment anyway.

But it seems to me that without intervention from outside the market place, folks might not otherwise choose to move toward diesel, and certainly, the refining companies would gain no advantage in encouraging folks toward diesels.

As a side note, I have become, in the last few years, a diesel enthusiast. My son started at a local Catholic high school in September 2007, and I found I was filling my SUV twice a week. Yikes! In January 2008, I replaced my wife's gasoline-engined vehicle with a newer model of the same car, but diesel, and I gave her my SUV (she drives less than 7000 miles per year). Whereas my wife's old car got about 18 - 20 mpg, I've averaged about 30 mpg with the diesel for the past two and a half years. I'm sure that part of that is that there have been improvements overall in fuel economy from my wife's old car to my newer car.

But I think part of it is that because there's a lot of torque, and much of it is available at low speeds, the car is easier to drive more economically.

When we finally get my wife a new[er] vehicle, we'll probably get another diesel.


sitetest

29 posted on 08/09/2010 12:27:13 PM PDT by sitetest ( If Roe is not overturned, no unborn child will ever be protected in law.)
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To: SpaceBar

30 posted on 08/09/2010 12:45:47 PM PDT by WOBBLY BOB (drain the swamp! ( then napalm it and pave it over ))
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To: sitetest
If refining companies decided to really try to push Americans toward diesel vehicles

Refining companies, like nearly all producing companies, invest dollars to make products that make profits. They are not social engineering organizations like governments that do not care about the dollars.

I don't know how we might move more toward the use of diesel passenger vehicles without some government intervention.

If it is cheaper, we will, baring government interference. If it isn't, I don't want to move that way.

I buy vehicles based upon dollars per mile, meeting my specifications of usage and safety. In 2007 I bought a new full size pickup for about $15,000, small gasoline engine.

A long-term tax credit...

Please, no more social engineering via tax dollars.

without intervention from outside the market place, folks might not otherwise choose to move toward diesel

And if so, that's okay.

31 posted on 08/09/2010 12:49:28 PM PDT by thackney (life is fragile, handle with prayer)
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To: Red Badger
Go for proven technology - Charcoal gas producer - "it's carbon neutral".


32 posted on 08/09/2010 1:10:43 PM PDT by Oztrich Boy (a 16 year old Australian girl already did it. And she did it right. - WWJD)
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To: thackney
Dear thackney,

“Refining companies, like nearly all producing companies, invest dollars to make products that make profits.”

Yes, I know. That's why I said immediately before the sentence fragment that you quote, “I guess the problem that I see is that there probably isn't much incentive for the refineries to do this.”

The lacking incentive, from my perspective, is “profit.” That's why the words that followed what you quoted were, “...in order to use the additional diesel that they would produce after retrofitting, they'd wind up selling less refined product after having made major capital improvements.”

Not a very effective use of capital for most companies.

“’I don't know how we might move more toward the use of diesel passenger vehicles without some government intervention.’

“If it is cheaper, we will, baring government interference. If it isn't, I don't want to move that way.”

Maybe. A large move toward diesel passenger vehicles might well result in significant societal savings, as folks would use less fuel, from longer engine life (although I spend modestly more for maintenance than I did on my wife's gas-powered model). And the reduction in the overall use of oil would reduce demand for oil, thus causing a little downward pressure on the general price of oil.

“I buy vehicles based upon dollars per mile, meeting my specifications of usage and safety.”

As you point out, price isn't your only consideration. There are those “specifications of usage and safety.”

A lot of folks with whom I've spoken have “usage” issues with diesel. Noise, dirty and smelly exhaust, lack of acceleration.

But these aren't really issues in modern diesel vehicles, and haven't been for some years.

An incremental reduction in costs may not be enough to overcome ingrained beliefs and behaviors.

“’A long-term tax credit...’

“Please, no more social engineering via tax dollars.”

Well, that's why I said, “Something like a pretty sizable tax credit for purchasing a diesel passenger vehicle. I'd imagine most folks would be against that.”

I understand your preference for free markets. I prefer them, too.

And obviously, it would be very nice if our government stopped sitting on the domestic energy production industry, preventing them from doing what they can actually do.

But, the problem is that the markets for energy products don't seem particularly free, especially those parts of the market that are made outside our borders.

Energy production takes a lot of capital. So, even if we were to free up our own markets in our own country, the folks who run these very capital-intensive companies must still deal with, plan for, anticipate and figure out how to make profits when dealing with producers who don't necessarily abide by free market principles, who don't even always put optimization of profit over the long-term as their No. 1 concern, and in fact, who don't even always think it's important to obey the rule of law, especially contract law.

I'm just an interested outsider in this field, making no claims to expertise. Nonetheless, I've watched for a long time, and I try to connect the dots. As an example, I've watched Shell with their shale oil projects out west for some years. Obviously, the primary current problem with their work right now is the near-outright ban on producing commercially-viable amounts of oil from the shale. * sigh * That's a tough one to overcome.

But even during the Bush years, Shell was very cautious about what they were doing out there. This was in great part because of the great technological difficulties associated with producing oil from shale. But I read a lot of documents from Shell, and an interelated - and very significant - factor was Shell's concern that they'd start producing a bunch of oil that was profitable at a specific price - say, $50 per barrel - and they'd find themselves in an environment with $30 per barrel oil again.

And, obviously, making money, and sufficient amounts of it, are very important to companies like Shell. I read an interesting analysis about various internal rates of return on investment at different world oil prices, and how that dramatically affected Shell's plans to ramp up production. Obviously, if they anticipated sustained high oil prices, their interest was to ramp up much more quickly (by a factor of two over 10 years) than if prices were somewhat lower.

But they were understandably very skittish to really move forward much at all if they determined we might have another relatively prolonged period of prices below something like $50 per barrel.

Perhaps my observations are incorrect, but it seems to me that the folks who make significant efforts to control, or at least significantly affect, market prices through cartelization, don't seem to object too much to an occasional swoon in prices, as it clears out all the folks producing oil at significantly higher prices.

Which then allows them to restrict their production again, and drive prices back up.

I imagine that oil would be a lot cheaper and more plentiful if folks like the Saudis, the Venezuelans, the Russians and the Nigerians permitted free markets, honored contracts, and didn't try to cartelize the market.

But those things aren't the case.

And our domestic producers, to the degree that they have any range of freedom to act, must respond to these unfree market forces in a way where they can still make money.

All of which has a negative impact on us, American consumers.


sitetest

33 posted on 08/09/2010 2:42:04 PM PDT by sitetest ( If Roe is not overturned, no unborn child will ever be protected in law.)
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To: sitetest

I believe Shell’s issue in Oil Shale is not so much techical as it is economics, politics and social acceptance.

Estonia has used Oil Shale for fuel for decades.

Brazil has been in Commercial Operations since 1992, see Petrosix for more info.

China has been operating Oil Shale for some years as well.

These all use above ground retorting combined with mining the shale like coal.

Shell has been focused on the most return for in-situ operations, partly I believe for political and social acceptance. Most of the US shale reserve are on federal land. There are some thin, low value oil shale in the Midwest, but there economics would be challenging. Green River formation would have the best returns.


34 posted on 08/10/2010 5:31:45 AM PDT by thackney (life is fragile, handle with prayer)
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To: Red Badger
Cadillac WTF – the world’s second nuclear-powered car

Eats Obama Volts for power.

35 posted on 08/10/2010 5:39:15 AM PDT by McGruff (How's that Hopey Changey thingy workin for ya?)
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To: McGruff

Gots a link?...........


36 posted on 08/10/2010 5:42:15 AM PDT by Red Badger (No, Obama's not the Antichrist. But he does have him in his MY FAVES.............)
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To: cripplecreek

Daimler Benz has done the research and has the products.....now

Their turbo diesels trounce American gas engines and run the trucks all over the world.

The article says the American problem is not the diesels but the refiners. If there were more fuel, there would be more engines.

Diclaimer...... I have one.


37 posted on 08/10/2010 5:46:55 AM PDT by bert (K.E. N.P. N.C. +12 ..... Greetings Jacques. The revolution is coming)
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To: bert

I’m not ready to go diesel and probably never will be, but I do see the advantages. Bio diesel looks like a far more viable alternative than ethanol in the place of gasoline.


38 posted on 08/10/2010 5:55:31 AM PDT by cripplecreek (Remember the River Raisin! (look it up))
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To: bert

We import more gasoline and gasoline components than we import of diesel. It is not an issue of what is available, but rather the government regulations of the fuels and their usage.


39 posted on 08/10/2010 5:59:53 AM PDT by thackney (life is fragile, handle with prayer)
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To: thackney
Dear thackney,

“I believe Shell’s issue in Oil Shale is not so much techical as it is economics, politics and social acceptance.”

That enhances my argument further.

I dwelt on the technical obstacles in order not to slight them as a reason for the slow progress and cautious approach by Shell. After all, technical obstacles are removed only as fast as the technology progresses, and technological progress isn't dictated by outside schedules.

But now you're saying that the technical issues are less of an obstacle than I thought.

If there are few, if any technical issues, then Shell's big obstacles are political - getting the government to let them do their thing, and economic - making sure that it's profitable.

Which returns us back to the caution that Shell has taken because they produce oil in an environment where oil prices are heavily influenced players who don't abide by free market rules.

It was a few years ago when I read this stuff, but it was eye-opening. As you pointed out, capital IS limited, and Shell was quite explicit in what I read about how that would affect their production of oil from shale. Even assuming world oil prices that allowed for them to produce the oil profitably, a modest difference in world oil prices accounted for a doubling of production.

In other words, if Shell assumed a price of around $50 (I think that was roughly the number), it meant that they would produce X amount of oil from the shale in Y years (I think it was the better part of a million barrels a day, but I'm working from memory). On the other hand, a sustained price level of something like $65 per barrel meant they would ramp up to 2X amount of oil in Y years (which was well over a million barrels per day).

In a free market, worldwide, we'd be happy with this sort of thing, because producers could make rational economic analyses, make their plans based on them, and the market would produce sufficient amounts of energy products, of the right sorts, in the right amounts, at competitive prices.

But because the world market for oil is largely unfree, the analyses on which these guys need to make their plans are inherently less reliable and a good deal more complicated. Because their analyses are less reliable, companies like Shell must act more cautiously. And that reduces what they might have otherwise produced, keeps supplies tighter, and keeps costs higher.

And that says nothing about the costs that aren't directly economic. It doesn't deal at all with the fact that the current market makes Saudi jihadists, Nigerian scammers and kleptocrats, and Venezuelan thugs geopolitically important folks with geopolitically important lands, and gives them the funds to seek starkly anti-American policies, and forces us to have to care what happens in places like Iraq or Iran or Saudi Arabia (and even peripherally, about non-oil states like Afganistan). It doesn't deal at all with the fact that our own policies are constrained by our continued need for hundreds of millions of dollars of their products daily, and our need, then, to give large sums of money daily and make nice to those who would just as soon cut our throats.

Obviously, reducing the obstacles set in place by our own government is critical to increasing domestic energy production.

But we're only a part of the worldwide market, and the government intervention and outright control of oil by oil-producing countries puts us at a disadvantage if the only thing we do is reduce the obstacles to domestic production set in place by our own government.


sitetest

40 posted on 08/10/2010 6:18:33 AM PDT by sitetest ( If Roe is not overturned, no unborn child will ever be protected in law.)
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To: sitetest

Well said.


41 posted on 08/10/2010 6:26:11 AM PDT by thackney (life is fragile, handle with prayer)
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To: thackney
Dear thackney,

Thanks.

All that being said, I think that we both agree strongly that our own government should stop interfering with the ability of companies to produce energy domestically in the United States.

I think that we're likely in agreement that we should be drilling in ANWR, drilling off the coast of California, drilling nearer to shore, in shallower waters of the Gulf, off the Atlantic coast, the Bakken - wherever there's oil. We should be doing the whole shale thing (It'll take decades to ramp up, what are we waiting for?), drilling for natural gas, so on and so forth.

But there is the second part of the equation, and that's how a largely unfree, partly-cartelized, largely sovereign-run world oil market impacts our own energy markets and domestic energy production industries.

How do you view the effects of the largely unfree world market on our own domestic energy production?

What role should our government play or not play in the mitigation of any negative effects?

Thanks again,


sitetest

42 posted on 08/10/2010 2:44:18 PM PDT by sitetest ( If Roe is not overturned, no unborn child will ever be protected in law.)
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To: sitetest
How do you view the effects of the largely unfree world market on our own domestic energy production?

I see the foreign energy markets have been raised in importance due to the inhibiting of our own.

We are only "held ransom" by them because of our own policies.

We need more nuclear plants combined with nuclear fuel reprocessing. We need better access to our coal, oil, natural gas and shale resources.

We don't need govenment subsidies. We need less govermnent restrictions.

43 posted on 08/10/2010 7:25:04 PM PDT by thackney (life is fragile, handle with prayer)
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To: thackney
Diesel is where the smart money is- it holds energy longer without evaporation, degradation, or storage in high pressure tanks, and is not as volatile or prone to explosions like the alternatives (although it does gel at sub-zero temps). Can't wait to see those 100,000 psi hydrogen tanks go off in some soccer mom's van- Yikes! The comparison of miles per barrel compared to gasoline is totally misleading. The apt comparison is how much farther you can travel on a gallon, and the savings over the life of the vehicle, resale value and time saved refueling due to the 700 mile tank range, not to mention the peace of mind that comes when you are not in a rolling flame thrower. I do think the grass, canola and other seed oils, with other farm grown fuels (algae) could save America's small farms, but of course zero would not approve of self reliance without massive gov’t control. It is far too easy for people to make their own diesel fuel with a seed press, and the government wouldn't be able to tax the crap out of it, so the EPA ties up foreign (and domestic) car companies with ridiculous diesel particulate emissions restrictions. (see: Mahindra diesel trucks). I fear they prefer a fuel that has to be funneled through their multi-tiered taxing system before it can be OK'ed for use by us...
44 posted on 08/11/2010 9:02:26 PM PDT by Rocketwolf68 (Bring back the crusades)
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