Friday, June 02, 2006

Energy, it's all going to be ok....

It's quite alarming to read some of the stuff out there about oil and what it's going to do to our economy when it continually gets more and more scarce. One of the more alarming sites you can visit is Peak Oil: Life After the Oil Crash.

"Because petrochemicals are key components to much more than just the gas in your car. As geologist Dale Allen Pfeiffer points out in his article entitled, "Eating Fossil Fuels," approximately 10 calories of fossil fuels are required to produce every 1 calorie of food eaten in the US."

The implications of such things are that not only is the gas going to be expensive, but everything that it's tied to. Hauling, extracting, digging, power generation, etc etc.

This is very valid cause for concern, as what will we do? The article attempts to refute biodiesel as an alternative given that it requires the use of oil powered machinery.

This is a valid arguement, with the exception of some recent developments in the methodology in producing biodiesel. Most notably the discovery of biodiesel extraction using a species of algae.

"NREL's research showed that one quad (7.5 billion gallons) of biodiesel could be produced from 200,000 hectares of desert land (200,000 hectares is equivalent to 780 square miles, roughly 500,000 acres), if the remaining challenges are solved (as they will be, with several research groups and companies working towards it, including ours at UNH). In the previous section, we found that to replace all transportation fuels in the US, we would need 140.8 billion gallons of biodiesel, or roughly 19 quads (one quad is roughly 7.5 billion gallons of biodiesel). To produce that amount would require a land mass of almost 15,000 square miles. To put that in perspective, consider that the Sonora desert in the southwestern US comprises 120,000 square miles. Enough biodiesel to replace all petroleum transportation fuels could be grown in 15,000 square miles, or roughly 12.5 percent of the area of the Sonora desert (note for clarification - I am not advocating putting 15,000 square miles of algae ponds in the Sonora desert. This hypothetical example is used strictly for the purpose of showing the scale of land required). That 15,000 square miles works out to roughly 9.5 million acres - far less than the 450 million acres currently used for crop farming in the US, and the over 500 million acres used as grazing land for farm animals."

When you look at the fact that most extraction and heavy equipment runs on diesel engines that biodiesel can readily power with little to no modification...suddenly the future is quite a bit brighter. The venture capital in a post-oil-crash market to develop infrastructure for such mass scale production leads to a new trend.

For starters, economies of scale comes into play in the production of biodiesel. If people are buying biodiesel as oil runs out, there will be billions upon billions to setup these ponds. There will also be an opportunity for more producers to come into play domestically. Energy buyers could turn to almost any individual wishing to produce biodiesel, from farmers to dedicated companies with these algae ponds.

This also brings me to a question, will the oil crash create more jobs and domestic economic revival for the US with such a new industry coming online? Could the oil crash be the best thing for the US in a long time?

Just some thoughts, if I'm off-base, please let me know.


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