American Petroleum Institute Chief Economist On Marcellus Shale Opportunities
On September 23, 2009, John Felmy, the chief economist of the American Petroleum Institute (API) spoke at the Pennsylvania College of Technology in Williamsport, PA about the vast opportunities that the API sees for developing the shale gas that is buried about 6,000 feet below the surface. Warning: Felmy is a self-admitted boring economist, but he does a pretty fair job of describing why the oil and gas industry is promoting the Marcellus Shale development so vigorously.
Here is part II:
Felmy has an interesting perspective on the energy alternatives – not a surprising one considering his employer, but one that is worth some thought and questioning about motives and desired effects.
Here is an excerpt on his discussion of the importance of natural gas:
That 23% could expand if it’s used in transportation. And, yes, it could replace oil use, but we are going to need all of the other things to be able to make that happen. The fueling stations, we’re going to need the vehicles, we’re going to need everything. But natural gas is truly a wonderful opportunity in a lot of different areas.
Here is another interesting quote about using natural gas to displace coal:
50% of our electricity is generated by coal. So that’s an important discussion in terms of what everyone is hearing about the climate debate. Because if you cannot solve that problem – situation rather er, um change the situation because I do not want to disparage coal, change the situation of how you generate your electricity, you’re not going to solve the problem.
You have to have reliable electricity supplies to be able to keep our economy going. And in that vein, natural gas is especially important. Because while you talk about generating electricity from solar, wind and geothermal, those are intermittent sources. Without backup generation from natural gas, they will not exist. (Emphasis in the original speech.)
It’s a simple fact that without gas, there’s no wind. Without gas, there’s no solar. So one of the things that will be very important going forward is establishing that link to be able to develop these new sources.
Finally, after talking about the importance of oil, gas, solar, wind, and geothermal, Felmy got around to an interesting quote about nuclear energy. I hope that you are a critical thinker who recognizes “damning with faint praise” when you hear it. It might lose a little impact in the transcription, but listen a few times to that same kind of talk coming from the competitive industries. You will start picking up a drumbeat that is working to mold the way that people think and talk about energy alternatives.
And then of course, nuclear power is roughly around 8% of our supplies. Hopefully we’ll see more nuclear power coming forward. It’s an excellent opportunity, although I must say, you know I never dreamed that it would happen possibly again. Because on March 31st, 1979, I drove by the cooling towers of Three Mile Island on the Saturday morning that they weren’t sure that it wasn’t going to explode.
Well, it didn’t. The safety systems worked, so we’ve gone forward with a very clean, very safe energy source. And hopefully that will expand.
I am sure that the reference to the accident that took place more than 30 years before the speech was not lost on the audience. After all, Williamsport is only about 90 miles north of Harrisburg and is on the same river as TMI. While mentioning all of the wonderful things about clean burning natural gas, Felmy does not say a word about explosions, mining debris, threat to water supplies, and concerns about pollution from processing and compression stations.
While mentioning the very clean and very safe nuclear energy, he makes sure that he says something that will grab the audience’s attention about the one major accident that occurred in the entire history of the US commercial nuclear power industry. Remember, the plant destroying accident at TMI did not result in any injuries to plant workers or the general public – other than the stress and fear imposed by overreaction by decision makers who did not understand the technology or the potential effects of the event. That is the kind of marketing message that nuclear advocates need to recognize and understand. We need to – individually – think about ways to respond and overcome that insidious effort to keep selling more and more fossil fuels while concentrating more wealth and power into the hands of the people who love to drill baby, drill.
I appreciate the honesty to come out and say that gas is a necessity for wind and solar instead of underhandedly promoting wind and solar in order to sell natural gas through the back door.
Rod, One of the unique advantages of the LFTR is its inherent ability to load follow, and to shut down at maximum temperature, so that a LFTR generator can go from stand by status to maximum generation as fast as its turbines can spin up. This coupled with the potential cost break through of LFTRs would offer a unique potential to replace the load following and back up capacities of natural gas. I pointed out some time ago, that the LFTR would make the ideal low carbon backup for wind, but the problem with a LFTR wind backup, is that wind generators becomes an unneeded expense, LFTRs can do the whole job and cost less.
On the other hand there are also things like this, reproduced here for you viewing pleasure:
Cheaper Solar with Natural Gas
Florida Power and Light has built a solar power plant linked to a natural gas plant.
By Kevin Bullis
“A promising approach to reducing the cost of solar power is moving forward with the construction of an installation in Indianatown, FL, that will combine a field of solar concentrators with a natural gas power plant.
Today The New York Times has an update on the project, which the utility Florida Power and Light (FPL) announced almost two years ago, and which we wrote about here. When completed later this year, the power plant is expected to generate up to 75 megawatts of power by making use of turbines at the natural gas plant, which itself has a 3,600 megawatt capacity.
The solar concentrators generate steam, which can be used to drive the turbines. Using existing turbines and generators can greatly reduce the cost of a solar power plant. FPL says the current project reduces costs by 20 percent, according to the Times.
Similar natural gas-solar hybrid projects are being built in Egypt, Morocco, and Algeria. There’s also an effort to pair solar concentrators with coal fired power plants. Abengoa, the Spanish based company that’s building natural gas plants in Morocco and Algeria, is working with Xcel Energy in Colorado to build solar coal hybrid test facility. According to Abengoa, such hybrids could cut the cost of solar power by 30 to 50 percent to as low as 6 cents per kilowatt hour, which is competitive with many fossil fuel power plants.
Note the benefit of combining fossil-fuel with solar, is to lower the cost of the latter to make it competitive with the former. The logic here is breathtaking.
There you have it. An API guy goes to a mining and geology technical college to talk to the students about opportunities in that field. I think I see the conspiracy now Rod.
What Rod does not know is just down the road is an affiliated university with a world class nuclear program. Not that a Purdue grad would admit it face to face with a Penn State grad. Down the other direction is the two-unit Susquehanna Steam Electric Station whose great performance is inspiring a new third nuke unit.
So Rod, maybe you should avoid telling folks how to make both speeches and energy because those black helicopters might get you.
Charles is certainly right that LFTRs do have wonderful qualities for potentially backing up wind and solar supplementary energy sources. No one I have talked to knows (and I am certainly ignorant) exactly what turbine design would complement LFTRs load balancing qualities and would produce a complete agile real world system that could handle peaking plant requirements faced when trying to backup renewables. Most turbines and generators are designed to operate at very specific speeds and power levels. This lends itself well to base load operation. Asking turbines and generators to quickly spin up to replace power lost from renewable energy systems would likely shorten the operating lifetime of turbines designed for base load operation. Are there classes of turbines that are designed for peaking plant operation that are designed to quickly and safely change (on the order of minutes) power levels that are well suited to backing up intermittent renewable energy? Does anyone know of actual manufactures and model numbers of turbines/generators that are well suited to peeking plant applications that could be mated to a LFTR?
Burning Shale Oil would pretty much put Florida underwater in the long run! That’s just a wonderful idea! That’s why I love the corporations so much. They just love to think about things in the short run rather than in the long run.
Kit – I said nothing about a conspiracy. I was clear in my post that the message is a marketing message, part of an effort to maintain the market dominance of fossil fuels.
There is nothing inherently wrong with that activity and I do not condemn it. I do want nukes to understand that their opposition is NOT the environmentalists who desire clean air, clean water and a brighter future for their children. Instead, the opposition is more businesslike – it is people who have a profitable product in which they have a vast quantity of capital invested. The opposition also includes large organizations that bill themselves as “Environmental” groups, but also take contributions from fossil fuel companies. In return, groups like the Sierra Club actually participate in the marketing effort.
Again, that is not inherently bad, but it is worth knowing. You cannot win a battle or a market struggle unless you recognize and understand your opposition.
I recognize that you are part of that opposition. I welcome your participation here and think it is an example of the wonderful world in which we live. We can engage in a mostly civil discussion, even though we vehemently disagree about the value of making serious reductions in our pollution quantities and enormous improvements in the availability of abundant energy.
Robert – sure – just look for turbines that were designed as propulsion turbines or as generator turbines on board ships where they have to be responsive to load changes.
It is not hard to design turbines that work well in response to changing loads.
Of course, I need to remind both you and Charles that there is nothing unique about LFTR in terms of being able to respond to load changes. Fission is an amazingly responsive heat source; designing systems that can make use of that is a matter of straight engineering. It all has to do with material selection, control systems choices, providing sufficient poison transient override capability, and system sizing.
Submarines have been operating with responsive PWRs for more than 50 years. They are capable of jumping from minimum self-sustaining to max power in less than a minute.
What opposition? It sounds like a sophomoric concept.
I am part of a team that works 24/7 to provide reasonably priced and reliable energy to American people. Working in the nuclear industry, I would like to think of us as starters.
When a nuke plant throws turbine blading, a gas fired power plant steps to meet the need. Look back 15 years and many nuke plants were poor performers. Workers there were complacent and thought rate payers owed them a job regardless of performance. These few nuke plants got competitive and now many places new nukes are in development.
I certainly do not oppose other parts of the energy team.
The original B&W reactor systems (TMI-I,II, Rancho Seco, etc) were guaranteed by B&W to follow a 20% per minute load increase/decrease without turbine or reactor trip. Additionally, they could withstand a 100% load loss without a turbine/reactor trip! These capabilities were tested and verified at various power levels for the load following and at several power levels above 50% and at 100% for load loss. Yes, we literally opened the main output breaker (after informing the dispatcher) for the load loss. As I recall there was only one or two trips at lower power levels that were corrected by control system tuning, and they passed the final 100% load loss twice. Reactor or turbine did not trip and the generator continued carrying house load i.e., RCPs and other in plant equipment (at TMI-I. TMI-II sends ALL generated power over to the 530 KV substation and then the house loads power comes back off of a lower voltage circuit, forget exactly how, been to long.)
The “consultants” from other nuclear plant designs were flabbergasted to see a plant do this and “advised” the NRC that this was not a good idea. Thus this feature was eliminated as a “TMI Lessons learned” restart requirement (Reactor trip on turbine trip requirement.). This feature had NOTHING to do with the TMI-II trip, so, to this day I feel it was a very stupid change.
So even ~1,000 Megawatt nuclear stations can load follow IF designed to do it.
Yep, one of the selling points of the B&W plants was the superior load-following capabilities that their Once-Through Steam Generators (OTSG) gave them.
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…BOOM!