All posts by Adam Aston

How recovering water from fresh potatoes helps a PepsiCo chips factory turn off the taps | Corporate Knights

For PepsiCo, one of the world’s biggest makers of potato chips, the key to producing the crispiest chips possible is all about driving moisture out of raw potatoes. Paradoxically, though, potatoes are made up mostly of water.

At a Walkers Crisps factory in Leicester, England, PepsiCo is turning this soggy challenge into a water-saving innovation. The goal: to extract so much water from inbound spuds that the factory can go “off grid,” drawing little or no water from public taps. Doing so, PepsiCo hopes, will help save the plant roughly $1 million a year in avoided water costs.

“The idea for taking factories off the water grid came from a simple observation by our front-line teams that potatoes are 80 per cent water,” says Martyn Seal, PepsiCo’s European director of sustainability.

PepsiCo’s efforts to turn off the taps at its Walkers plant in the U.K. is one sliver of a bigger batch of initiatives to make its global operations run with less water. In 2010, the food-and-drink giant, which turned over $66.5 billion (U.S.) in sales last year, released its first comprehensive water report. The effort, similar to initiatives out of rival Coca-Cola, set out details of its water consumption alongside plans on how to use that water more productively.

One of its headline goals is to improve the efficiency of water use – measured by water consumed per unit of production – by 20 per cent by 2015, using 2006 as a baseline. PepsiCo hit this target last year, four years ahead of schedule. Another goal is to strive for “positive water balance” in water-distressed areas. This means for every unit of water PepsiCo uses, it strives to restore, replenish or prevent loss of the same amount or more in the same region. It also aims to provide access to safe water for three million people in developing countries before 2016.

Early on, potato-chip plants emerged as a juicy target for these goals. Making chips is surprisingly water intensive. In a normal year, some 350,000 metric tons of fresh tubers is shipped to the Leicester factory – the equivalent of some 13,000 tractor-trailer loads.

In the plant, potatoes are washed, peeled and sliced. A steady flow of H2O is used at each of these steps. In Leicester, this process demands roughly 700 million litres of water annually, the equivalent of roughly 280 Olympic-sized pools. Yet as crucial as water is while preparing the raw spuds, it’s an unwanted troublemaker thereafter. The thin slices are plunged for a few minutes into oversized fryers filled with oil boiling at 190°C (375°F). Water trapped in the potato slices vapourizes instantly, turning the otherwise inedible starch into an addictively crunchy treat.

In a conventional set-up, the cloud of steam that rises from these vats is vented out into the air. PepsiCo engineers recognized that the vapour represents a huge waste of both water and energy. To recover these wisps of moisture, PepsiCo fit a contraption onto the plant’s exhaust towers. Inside, the hot steam passes over a network of thin, cooled tubes. Moisture from the potato vapour condenses on the cooler tubes for easy collection. The process also recaptures traces of cooking oil from the exhaust. Both the oil and water can be reused. About four-fifths of the moisture that is normally lost is recovered.

Together with systems that recycle about two-thirds of the plant’s wastewater, the steam-recapture project is on track to supply enough water to hit PepsiCo’s goal of drawing zero freshwater in Leicester. The company is already testing the technology at similar sites in Holland and Belgium, part of a plan to extend these practices to other large European operations and, later, worldwide.

A successful pilot in the Leicester plant “will provide us with a technology suite that we will be able to reapply at other PepsiCo plants, particularly in areas of severe water scarcity,” Seal says. “This is an opportunity to realize meaningful cost savings while reducing our impact on the environment.”

Combined with other projects across PepsiCo’s operations, the steam-recapture efforts contributed to savings of $45 million in water and related energy costs last year, compared with the 2006 base when the company began these efforts. By volume, in 2011 it used 16 billion fewer litres of water, compared with 2006.

As much as PepsiCo execs crow about the bottom-line impact of these efforts, they point to strategic benefits too: The company must plan for operating risks that droughts pose to future operations. By 2030, global demand for freshwater could exceed supplies by 40 per cent, explains Dan Bena, PepsiCo’s senior director of sustainable development.

“If this gap is not closed, there will be no business as we know it today,” he says.

~

See the original story here: http://www.corporateknights.com/article/tech-savvy-pepsico

How SAP and cities are boosting innovation through open data | GreenBiz

Listening to a couple of coders gush over the virtues of gamification, location-based mobile services and open data standards, I might have mistaken the techies for sneaker-wearing pitchmen at a Silicon Valley hackathon.

But this was midtown Manhattan. Instead of B-school dropouts, the geeks in question were actually silver-haired civil servants in charge of the IT operations for Boston and Edmonton. Though centuries old, each of the cities is racing towards decidedly cutting-edge goals of opening up access to municipal data for their residents and businesses to use and commercialize.

“Successful cities of the future aren’t necessarily the most efficient. It’s about engagement and citizen empowerment,” said Bill Oates, chief information officer for the City of Boston. “Our innovation is on people, to help constituents connect with the city.”

The CIOs were brought together by SAP to mark the U.S. launch of the software giant’s Urban Matters program, which aims to help municipal governments “deliver better-run cities” by opening up data streams for citizens and business to tap into.

As this software space matures, big companies also are exploring opportunities to integrate city data feeds into current and future services.

GM is grooming its OnStar unit to become the software hub for transportation services such as RelayRides’ peer-to-peer car sharing service. The automaker recently issued protocols that will let third-party developers integrate the data beginning to flow from cities — such as road construction information, or parking data — into future OnStar services.

In the world of smart buildings, Johnson Controls is likewise eyeing the opportunities emerging by tapping into huge, public pools of data on the performance of buildings in Philadelphia, New York, San Francisco, Washington D.C. and other cities.

Back in Boston, SAP technology is powering the city’s Boston About Results website and accompanyingCitizen Insights iPhone app. Citizen Insights collects, analyzes and shares performance measures across scores of city departments from tree planting requests to fire response times.

By digitizing and opening up their data flows, most cities are trying to evolve into “better versions of themselves” rather than presume to compete with Silicon Valley, said Bruce Katz, vice president and director of the Brookings Metropolitan Policy Program at the Brookings Institution.

Boston and Edmonton are pushing to lead a growing contest among cities aiming to boost their competitiveness by opening access to city data streams. Fighting to transform decades-old bureaucratic processes that tended to lock up key city information — such as property records or tax rolls — in hard-to-access formats, the goal is first to digitize as much information as possible.

As these programs grow more ambitious, cities face an outsized data challenge in scaling up these efforts. With centuries’ worth of property records or historical budget information, cities are typically sitting on mountains of data that are a challenge to digitize, standardize and make accessible.

Cities need “additional investment to deal with the analytics…of taking tens of thousands of data sets and looking inside them,” said Theresa Pardo of the Center for Technology in Government at the University of Albany (State University of New York, SUNY). “A lot of cities still have their records in paper form.”

Pardo’s center recently released a white paper, The Dynamics of Opening Government Data. The paper offers practical advice for government managers pursuing open data initiatives.

Edmonton started its open data efforts with a dozen public datasets in 2010. Today, “We have 257… San Francisco has 250,” said Chris Moore, the City of Edmonton’s CIO. Moore is pleased to be edging out one of the U.S.’s most wired metropolises.

Digitizing the information sequestered in city offices is just the beginning of the battle. Making those data streams publicly accessible and easily useable is essential for developers to build new services and businesses.

In Edmonton, for instance, the city transportation department recognized an appetite for access to information on road closures, resurfacings and the like. When the dataset went live earlier this year, it quickly became the city’s most popular feed. “After it was released, an Edmontonian created an app called YEG Constriction,” Moore told IT World Canada.

As Edmonton’s efforts unfold, Moore’s IT team hopes to stay at the front of city efforts by exploring gamification and the immersive 3D web as ways to boost public interaction with the data. For instance, the city is readying a Facebook game around traffic and safety, Moore said.

Behind all the enthusiasm for data transparency are bottom-line benefits that please city bean counters. The shift towards open data standards can deliver a big bang for the buck at a time when cities face rising demands for data services, yet have fewer resources with which to develop them.

In Edmonton, the city hosted Apps4Edmonton.ca, a contest to develop apps for city residents and businesses. “For around $50,000 we developed dozens of apps,” says Moore. Were the applications developed conventionally, he speculated, the cost of a single study of the business case would have exceeded that figure.

Code sharing between cities can further compound these savings. Boston’s New Urban Mechanics initiative encourages public collaboration to develop innovative civic services, explained Oates, the city’s CIO. Among the program’s most popular apps is Street Bump, an iPhone app that helps detect and report potholes. As a result of these efforts, nearly every pothole complaint in Boston is resolved in two days or less. A couple of years ago, less than half were completed that quickly.

Now, Boston is extending and sharing its New Urban Mechanics platform with dozensof other cities and towns, where apps can be adapted or further customized.

To be sure, cities aren’t going to threaten Silicon Valley’s software titans anytime soon. But the afamiliar, infectious air of competitive innovation is developing in municipal software circles. Earlier this month, Emily Badger at The Atlantic Cities rounded up the best open data releases of 2012. From listings of green roofs in Chicago to bikeshares in Boston, the apps are promising examples of how smart software can transform existing, static city data into dynamic, interactive tools that promise to make cities greener and more efficient.

While incremental, the boom in city data apps highlights how metropolises are best positioned to push ahead with effective innovation. “Cities are a lot more pragmatic than state or national governments,” said Brooking’s Katz.

Illustration of key opening file folder provided by Artgraphics via Shutterstock.

~

Check out the original story here: http://www.greenbiz.com/blog/2013/01/03/how-sap-cities-boosting-innovation-data

Meet the Change Makers: How UPS Delivers Big Energy Savings | OnEarth

For UPS, the world’s largest package delivery company, no time of year is more challenging than the holiday season. This year, the Atlanta-based company predicts the surge of packages it handles between Thanksgiving and Christmas will exceed half a billion. That tidal wave will peak on December 20 when, on a single day, some 28 million cardboard boxes will be loaded into UPS’s iconic big brown trucks to be delivered, at a rate of roughly 300 per second, to homes and businesses around the world.

The challenge of getting those packages where they need to be using the least amount of energy possible falls to Scott Wicker, who was named UPS’s first chief sustainability officer in 2011. Like many of UPS’s top execs, Wicker is a lifer. He got his start in 1977 unloading UPS trucks while studying to become an electrical engineer. Some three decades later, it’s fair to say Wicker is still working in trucks. Yet today, as CSO, his mandate is to improve the efficiency of UPS’s entire fleet of 93,000-plus vehicles – which includes those brown vans, long-haul trucks, and cargo planes as well as gondolas and tricycles — along with the company’s global portfolio of more than 1,800 facilities.

True to his engineering roots, Wicker approaches this challenge quantitatively. Given that fueling the UPS armada generates more than 90 percent of the company’s carbon emissions, much of UPS’s sustainability efforts focus on its fleet, such as streamlining delivery operations, developing fuel-efficient technologies, and exploring alternative fuels. In 2011, those efforts helped reduce company-wide greenhouse gas emissions by 3.5 percent, even though total package volume grew by 1.8 percent, according to a 2011 report.

OnEarth contributor Adam Aston spoke with Wicker about how UPS has achieved these gains and become one of its industry’s top performers on sustainability.

If there’s a singular example of UPS’s focus on efficiency, it’s the left-hand turn rule in which delivery routes are designed for drivers to make as few lefts as possible. How did this come about?

It’s one of a long list of tweaks we’ve been making to drivers’ routes over the years. It goes back to the ‘70s. Back then, we saw that we were wasting a lot of time making left turns. The more time a van sits waiting to turn, the more fuel is burned idling.

Can you quantify the benefits of the rule?

Partly. It’s part of a broader set of efforts to eliminate idling. Last year we avoided 98 million minutes of idling. And less idling means less fuel burned. We estimate that this effort alone saved 653,000 gallons of fuel.

So fuel efficiency is as much about how vehicles are driven, as what fuel they use or how the vehicle is designed?

Yes, some of the biggest changes to our fleet operations are the least visible. Last year, for example, we estimate we avoided driving nearly 90 million miles thanks to improvements in routing and package-flow technologies. That translates into more than 8 million gallons of fuel not burned. Our technologies determine how to load each package and where each one goes on a specific shelf in the truck.

We’re also developing the ability to adjust routing on the fly. If the driver has to veer off a route for any reason, the system can recalculate the optimal delivery sequence. Further, the system will help the driver to mix more urgent, early-morning deliveries in between less urgent deliveries with later time commitments. In the past, this hasn’t been possible — instead, all urgent packages are delivered first, regardless of lost opportunities to deliver another package nearby.

It may sound minor, but these changes can help reduce the number of miles each driver travels each day. When you multiply a few miles saved per driver per day, the aggregated savings in time, fuel, and carbon are significant.

That said, is the push for a high-mileage truck still a top priority?

Yes. With more than 90,000 vehicles, it’s a constant concern. Our fleet of alternative-fueled vehicles is the largest in the industry, and one of the most diverse. Since 2000, some 2,500 unconventional UPS vehicles have racked up over 200 million miles in service.

Many are powered by natural gas, which we’re looking to as an alternative to diesel. For example, more than 900 local delivery vans are powered by compressed natural gas (CNG) in the U.S., and almost that many vehicles in Canada are powered by propane [a close relative of natural gas]. For long distances, we also have about 59 big rigs — highway tractor-trailers — powered by liquefied natural gas (LNG).

Rounding out the alternative fleet are 381 hybrid electric models that, similar to Toyota’s Prius, use a combination of combustion, electric motors, and battery storage to boost mileage. Because they recapture so much of their energy through regenerative braking, these models are especially well-suited to urban routes, where total miles travelled is short, with many stops and starts, and pollution control is important. We’re also running a small number of ethanol-powered vehicles and pure electric vehicles, which run solely on power stored in their batteries.

We’re also excited to announce that starting this month, we’re rolling out 40 hydraulic hybrid delivery vehicles. This is a continuation of a program we piloted with the Department of Energy and other partners in 2006. Instead of storing energy in a conventional battery, these vehicles use hydraulic fluid as the storage medium. When the vehicle accelerates, some of this stored pressure helps it to start moving. During braking, the process works in reverse: the vehicle’s momentum is converted into pressure to recharge the hydraulic tanks. It’s a remarkably rugged system that can save up to 40 percent of fuel.

Why pursue so many kinds of technology?

We’d like to get off of fossil fuels. That’s our goal. Our approach is holistic because there is no silver bullet. It would be foolish to try to predict which fuel will emerge as the best or most durable.

Can you squeeze greater savings from your conventional diesel trucks?

Yes. One of the things we’re most excited about is “lightweighting.” Last year, we rolled out a test truck that looks similar to our regular delivery van, but that’s built with advanced materials that shave off 900 pounds. There are body panels made of lightweight plastic composites instead of metal sheets. Because the vehicle is so much lighter, we’re able to use a smaller engine, as well.

The trucks deliver approximately 40 percent gains in fuel efficiency, and the price is in line with the cost of a conventional vehicle. Based on that trial, we ordered 150 of these higher-mileage models. We’re also more comfortable with composite material and will consider adding more composite components into larger vehicle types.

UPS operates a lot of vehicles consumers rarely see, from planes to long-haul trucks. What are you doing with these?

To put this in perspective, more than half of UPS’s carbon dioxide emissions come from jet fuel, and the rest of our mobile fleet make up about a third of emissions.

For surface transportation, we shift as much as possible to rail, which is a far more efficient way to move goods than road. For rail and air, the efficiency options are fewer than on the road. With planes, we’re testing more efficient flight paths. Simplifying a jet’s landing pattern, by letting it glide down continuously rather than descending in a step pattern, delivers substantial savings. We’re also testing aviation biofuel. We know it works. The problem is making it at the right price.

Are your customers asking for data on the carbon impact of their shipping?

Customers began to push for this kind of data a few years ago. Big companies are facing more pressure from groups like the Carbon Disclosure Project, the federal government, and financial entities to report on their carbon footprints.

It’s been a challenge to build a system that collects all this data. But today, we’re one of the few logistics providers that calculate Scope 3 emissions, which often comprise a very large share of the total. These are the emissions produced indirectly to make goods or deliver services a company buys. [Ed. note: Scope 1 emissions are created from direct actions, such as fueling a UPS truck. Scope 2 are emitted indirectly, such as the emissions associated with electricity bought by a UPS utility. Find out more here.]

When we ship for a company, or handle its logistics, UPS becomes a major source of the company’s Scope 3 emissions. Delivering that data reliably is a very sophisticated process. Our experience developing these measures has helped us advise partners on their efforts to map out their own Scope 3 emissions, too.

Have UPS’s sustainability efforts helped attract customers?

Yes. UPS is the only U.S.-based company offering a carbon neutral shipping option across all product lines. Puma, for example, ships everything carbon neutral. Toto [a Japanese bathroom fixture maker] uses the service, too. Another example is LiveNation, which organizes touring bands. We ship of all the bands’ gears in our trucks, and, in some cases, have begun to manage transport for those tours in a carbon neutral manner.

~

Originally published at http://www.onearth.org/article/meet-the-change-makers-how-ups-delivers-big-energy-savings

Jeffrey Sachs’s bright vision at Climate Week | Global CCS Institute

In this post, Adam Aston takes a look at some of the singular messages contained withing Professor Jeffrey Sachs’ important address at Climate Week in New York. Below Adam’s analysis is a lightly edited transcript of Professor Sachs’ address.

I write and read about the climate every day. Yet, even after years of tracking the complex cast of climate issues, every now and then my perspective is dramatically re-booted by what I think of as a ‘cathartic climate message’. It happens when a remarkable mind can yank your mind’s eye back up to the highest level of concern for the planetary risk posed by carbon pollution. For many people—myself included—An Inconvenient Truth did just this, synthesizing vast frontiers of information into a single, lucid, alarming message that sparked a fundamental awakenings.

At Climate Week NYC a few weeks ago, Jeffrey Sachs did likewise, forcefully reminding an audience of 200 or so climate veterans of the scale of the risk ahead, and that both technical and political solution are at hand.

Nearly 20 years ago, The New York Times dubbed Sachs “probably the most important economist in the world”. Now based at Columbia University, Sachs earned this reputation by applying economic theory to real-world development problems with remarkable fervor. In so doing, he has married the often-at-odds worlds of quantitative academic economics with the vexing, on-the-ground challenges of humanitarian development.

In his world-view, poverty, hunger, disease, and environmental degradation are not merely painful dynamics happening far away, they are solvable problems with knowable causes and testable solutions. Accordingly, Sachs has not been shy to role up his sleeves, and apply dramatic economic medicine on a large scale, and not always successfully.

Sachs’ blend of pragmatism and penetrating intelligence has won him influence across the globe, from the U.N. to the White House. At Columbia, Sachs is the nodal center of much of the university’s work on international economics, public health and climate. He is head of the school’s Earth Institute, as well as the Quetelet Professor of Sustainable Development at Columbia’s School of International and Public Affairs and a Professor of Health Policy and Management at Columbia’s School of Public Health.

Accordingly, Sachs has strong convictions about the failure of U.S. policy to deal with carbon pollution, and accelerate carbon capture and renewables. Though Sachs was speaking roughly a month before the recent U.S. presidential elections, he was highly critical of cap-and-trade policy proposals. Though palpably frustrated with federal climate policy, Sachs publicly supported President Obama and has lobbied the White House to impose a carbon tax.

Amidst post-election jockeying to overhaul the U.S. tax code, Sachs’s take on carbon taxes looks prescient. Immediately following the election, conservative Washington think tanks have been exploring the impacts of a carbon tax with unprecedented seriousness. As Keith Johnson observes in The Wall Street Journal:

Today [Nov. 13] the conservative American Enterprise Institute is holding an all-day, on-the-record discussion of the idea [of a carbon tax]. And the Brookings Institution is unveiling a slate of new measures meant to make the government more effective, including a carbon tax that could raise $1.5 trillion over ten years. All that follows a cascade of carbon-tax advocacy in recent days from the chattering classes and a slate of academic work over the summer…

Sachs is confident a carbon tax could be deployed—and, importantly, sold to the public—by back-loading the tax so that it scales gradually. By using revenues to subsidize renewables and by giving investors a clear signal about future carbon costs, Sachs argues a tax will be more effective than cap-and-trade at steering investment towards low carbon technologies such as CCS.

Sachs spoke for an hour, without notes, reeling off reams of detailed economic and climate data from memory. However sharp his views, they offer an invaluable reference for why work on low-carbon technologies must continue, and quite possibly useful advice to help shape a future carbon policy. After his speech, he was interviewed by Climate Week, the video of which is below.

Following, find a lightly-abridged transcript of Sachs’s presentation to Climate Week.

Climate change is here, now

Thank you.

I’m pleased to be here and to know this group is grappling with these complicated topics. There are no known answers to this problem yet, so I could just sit down. [laughter]

Climate change is certainly the most complicated challenge that humanity has ever had to take on because the problems go to the core of our economic system. Energy is the most important sector of the modern economy.

And yet we have grown up for 200 years on a fossil fuel-based economy. So far, that has been a great thing for the world. Except now, it could ruin the world. We don’t have a clear pathway out of this and unfortunately time is short.  We have already filled the atmosphere with greenhouse gases to a level of dangerous anthropogenic interference in the climate system.

In other words, the urgency of climate change is not as we first spoke about it 20 years ago, as a threat to our children and our children’s children. Rather, it is here now. We’ve entered what the geologists call the Age of the Anthropocene, meaning the period in Earth’s history when a single species—homo sapiens—has major Earth dynamics under our strong, and not so beneficial, influence.

Greenhouse gas emissions have already risen to a level that, in past history of the world, coincided with ocean levels many meters higher than they are now. This shows that we’ve already reached a level of human-induced change that, if it now unfolds over decades or perhaps centuries with all of the feedbacks included, we’ve already fundamentally changed the planet.

We’ve already emitted enough carbon dioxide to reduce the pH of the ocean by 0.1 units and we’re on a path to reduce the pH by about 0.4 units perhaps by mid-century. This could destroy a tremendous amount of the marine life around carbonate-needing species. Even aside from anticipated changes to the atmosphere, ocean acidification is coming from CO2 dissolving in the ocean surface and affecting the carbonate balance, the buffering function of the ocean. This dynamic, on its own, is enough to do tremendous harm.

Climate arithmetic

The point I want to make is that we’re already in the middle of dramatic change. We have not yet succeeded mentally, we have not yet succeeded technologically, and we certainly have not yet succeeded politically in finding a way forward.

The arithmetic is not all that complicated. It’s the solutions that are complicated.

The arithmetic is that the world economy is now amounts to $70 trillion per year. That’s seven billion people, on average, producing $10,000 per person in common units of purchasing power. We use about 200 kilograms of oil-equivalent energy for each $1,000 of GNP globally. It’s not so different across all scales of poor to rich countries actually, because energy scales with the level of production more or less proportionately.

For each kilogram of oil-equivalent energy unit, we emit about 2.4 kilograms of CO2. That’s a measure of the carbon intensity of our energy.  If you multiply our energy use–the roughly 200 kilograms of oil-equivalent energy per $1,000 of output—by the roughly 2.4 kilograms of CO2 per kilogram of oil-equivalent energy, you see that we use about 0.46 kg of oil equivalent energy per dollar of GNP and emit about 460 kilograms of CO2 for every $1,000 of income.

Multiply that factor by global GDP, or $70 trillion, and that turns out to be about 33 billion tons of CO2 that we emit per year. Given the holding capacity of the atmosphere, that rate of emissions is raising the CO2 concentration in the atmosphere by about 2.5 parts per million per year.

The result is fairly simple math. We went from about 280 parts per million in the pre-industrial era to about 395 parts per million now. We’re on a path of increasing that number by roughly 2.5 parts per million every year.

How dangerous, at what level?

Now, what level is dangerous? It depends who you ask.

I regard my colleague [at Columbia University], Jim Hansen, as the premier climate scientist in the United States. He has taken the most flak from climate skeptics and that’s a good indication that he’s the most important and the most accurate of all the climate scientists. Twenty-four years ago Hansen told the U.S. Congress for the first time what our planet would be like if we went on with business as usual for another quarter century. It’s a quarter century later now, and it’s clear, he nailed this prediction almost to a decimal point.

Ask Hansen what is a dangerous level CO2 accumulation, and he’ll tell you that we passed the safe level by about 45 parts per million. He puts the threshold back at about 350 parts per million. Every time in Earth’s history when we’ve been above that threshold, ocean levels have been several meters higher.

So why aren’t they higher now? They’re haven’t risen yet because there are feedbacks that take time. For example, given the CO2 that we’ve emitted so far, the Earth’s temperature has warmed by about 0.8°C from the recent historical average. If we allow even the relatively short feedbacks to accumulate further to what we’ve already done—not adding any additional CO2, just including emissions to date—we’re going to have about twice that amount in warming.

In other words, we’ve already built in planetary warming of about 1.6°C, but we’ve observed only about half of that so far because the ocean takes time to warm up. It’s a big bathtub. It has a tremendous heat capacity. It’s warming, but it takes time.

That only accounts for changes to date, however. As Hansen points out, we need to factor in longer-term feedbacks: the loss of polar ice, changing the albedo of the Earth’s surface; the possible degassing of CO2 from deep oceans; methane release from permafrost; and others. These happen in highly non-linear ways.

Taking into account these effects as well, and we’re talking about a massive change of the planet, a massive change of sea level, a massive change of ocean chemistry, and a massive loss of species diversity.

Denial has real costs

We tell ourselves, “It’s okay. We have time. Maybe we’ll get to 450. That’s okay. What’s a couple degrees Centigrade among friends?”

In this country, we have our leading business newspaper, The Wall Street Journal, propounding these sorts of myths every day in its editorials, with a directly antiscientific propaganda. At the same time, it’s a wonderful newspaper—it’s got great news stories. But its opinion pages are extremely damaging because we’re already into the midst of massive climate disruption.

For example, this year, we had our 12 warmest months in U.S. history, spanning from July 2011 through to July 2012. In fact, July 2012 has turned out to be the single warmest month recorded in U.S. history.

We’ve had the worst drought in modern history, which has done great damage to the corn crop. Food prices are soaring.

We’ve had a presidential campaign where this issue has barely been mentioned—perhaps in one speech, in one paragraph. We have willful neglect because of the power of the lobbies. Politicians’ main job is to raise money to run advertisements and that costs a lot of money and the oil companies have a lot of money.

So here we are in the middle of this disaster and we can’t even talk about it. Now if we could talk about it we’d find out, “God, this is harsh. What are we going to do?”

The fact of the matter is that this is not in U.S. hands, even though the U.S. remains the largest economy, at least for a few more years. China may overtake the United States by 2017 or 2018 in total purchasing power.

In total carbon emissions, China has already overtaken the United States. China is by far the largest emitter and its emissions will continue to rise dramatically because—even with all of the innovative, renewable energy coming on line there, as well as all of the nuclear plants it is building—China is also increasing massively its use of coal. China is a coal-rich country, and what it can’t get domestically it’s importing from Australia.

The developing countries as a whole are now in the driver’s seat of the world climate in the future. They ask:

Why should we do anything? The most powerful country in the world—the United States, the richest country, the one with the highest per capita emissions of any major economy—won’t do anything. Why should we do anything? We need to catch up. We’re still poor. We’re still only one-fifth the per capita income of the United States. Why look to us? We just happen to have a lot of people.

They have a point. Except that this kind of relentless prisoner’s dilemma logic—“You first. No, you first. Thank you, no. I’ll do it after you”—is going to wreck the planet.

Destabilizing Africa

Before I turn to a couple of the possible solutions, I should say that the impacts are not just things like the heat wave in Europe, which took many lives, or the crop failures here in the U.S. this year.

There is also devastation occurring in drier, poorer parts of the world, especially in the horn of Africa and the Sahel [a region spanning the northern third of the African continent, where desert transitions into savannah].

Nobody knows for sure but the evidence seems to be that the warming of the Indian Ocean has pulled the rainfall off the coast of East Africa into the Indian Ocean. It’s led to a significant drying of what is already one of the driest places in the world: Ethiopia, Somalia, northern Uganda, northern Kenya and that area.

There have been horrendous droughts in recent years. That’s contributed to lots of violence, lots of extremism, and Al Qaeda. Then the drone missiles fly and we’re into a kind of a mind-boggling spiral of places in the world becoming almost uninhabitable. Instead of working on their resiliency, digging bore wells and helping with agriculture, instead we see war taking over.

In West Africa it’s a similar story, albeit with a different underlying mechanism. The Sahel has also faced a massive drought this year. We have already lost one country to collapse. Mali experienced tremendous violence in the form of coup in the south and an insurrection in the north.

If there’s a message from these cases, it’s this: Don’t be complacent. Don’t think we’re going to work it all out. Don’t expect that we’re going to learn, or that everything will be fine, or that we’ll get our act together.

Our capacity to wreck things is very high. The world’s economy keeps growing, there’s a lot of fossil fuel, and we’re very good at finding new ways to dig it up and burn it. We have the hydrofracking boom right now, as well as oil sands and oil shale. Anything we can find to burn, we will burn.

If we do that we will completely wreck the planet. And we’re already well advanced in doing that.

So that’s the problem. Now what’s the solution?

Low carbon technologies: CCS and renewables

The solution is we need alternatives. We have lots of candidates. We need to de-carbonize the global energy system.

By 2050, today’s world economy of $70 trillion should be maybe $200 trillion, if poor countries grow successfully. They will need a tremendous amount of energy. Even if we’re highly energy-efficient, the need for primary energy will grow tremendously.

To grow, we must turn to low-carbon energy. There are basically two ways to do that. One is to use primary energy sources that are not coal, oil, gas or things like it. That could be renewables, wind, solar, or geothermal. It could be nuclear.

The other alternative is to use those sorts of fossil fuels but to clean up after ourselves using carbon capture and sequestration, or CCS.

There are two logical chains of carbon capture and sequestration. One is to capture the CO2 as you burn it, at power plants, and sequester it safely geologically. The other, which one of my colleagues is working very hard to do, is to try to capture CO2 directly from the air. That’s more expensive because you have a diffuse source of CO2: it’s only 395 parts per million molecules in the atmosphere. If this can be done, it has an advantage because then you don’t need pipelines to transport it. Also, you can put the collectors in places best suited to geologically sequester it directly.

There is nothing wrong with fossil fuels. This is not a moral question, except for the CO2 issue. Using fossil fuels would be great—it’s gotten us a long way in the world, except it’s dangerous if we don’t clean up.

CCS is an extremely important potential technology for doing this. I think the overall logic of what to do is fairly clear. The overall logic is to clean up our power grid and convert our internal combustion to some form of electricity because cars can’t capture their own CO2 out of their exhaust. If we want to handle the roughly 25 percent of CO2 that’s emitted by our vehicles, the transport sector has to use a low-carbon power source. And that can be electrification.

The basic path of what we is this: We must move from a fossil fuel-emitting electric power sector and internal combustion-driven transportation sector to an electric power sector that is essentially carbon free and a transportation that is fuelled by carbon-free electric power sector.

Tipping the balance towards carbon free power

We’re not getting there right now because it requires extra resources to get there. You need to tip the balance to get moving in the right direction go by making market signals that us in that direction rather than in the current direction.

Right now, the market signals are pretty clear. If you want base-load electric power, burn coal. It’s cheap. It gives you reliable electricity at the lowest possible cost. Your industry will be competitive and our planet will end up destroying itself.

We need to put a signal that is much more powerful and at the same time, do a lot of research and development to figure out which of these pathways is viable and at what cost.

It’s not enough, by the way, to just put a price on carbon. We have to make societal decisions as well. For example, what do we think of nuclear power? Who is in favor? I am. Anybody else? Okay, a few people. Who’s against? All right.

The price of carbon will not decide this question. We’re going to need to vote, to debate it. We’re going to need to have a plan. There are valid arguments on both sides of this issue, but we’d better decide it and it’s not enough to have Cap and Trade to decide it. We actually need to have public decision-making and much more rational scrutiny of the options.

Other technologies pose tough decisions too. For instance, if we’re going to deploy renewables at scale, we need public right-of-ways for high-voltage transmission lines. We need to carry wind from the Dakotas to the populated centers.

We need to decide what we’re going to do with the Mojave Desert. How many solar panels are going to fill the desert and in which way? Yet not many people live in the Mojave. So you have to move energy to where it’s needed. That requires right-of-ways, land management, public decisions, ecosystem protection and so forth.

I’m in favor of these low-carbon options. But to be clear, all of them all require consensus and public investment.

U.S. policy paralysis

So what do people here [at this talk] think about the U.S. energy plan, the Obama plan? Have you read it?

It doesn’t exist. Obama’s rhetoric—“All of the above”—is not a plan. All of the above is to get past the election. There is no plan here.

It’s worse than my first year students by far, who easily can put together spreadsheets and give options and decide what to do. We have a Nobel Laureate Secretary of Energy in this country. Who has seen him recently?

Of course, he’s not been visible during the election because he might say something real. That could upset somebody and that could trigger advertisements by Super PACS.

So we have nothing. No plans energy, no policy documents, no long-term strategy, no honest speeches, no discussion at all. I have never seen anything like it. It’s almost a complete collapse of politics in this country. Or I should say it’s almost a complete collapse of policy in this country. There is no policy, by design. Policy is dangerous. Somebody might object. Somebody might not contribute to the campaign.

And so neither side says a word right now. But four years ago, this President wanted to do something. The one thing they tried to do—cap and trade—was the wrong thing. I want to emphasize this: Cap and trade is absolutely the wrong approach for this problem. Cap and trade puts a spot price on an issue that needs a 25-year price. These cap-and-trade systems were all proposed for one reason: because American politicians didn’t want to say the word “tax”.

An analogy has been made with the sulfur dioxide reductions of the 1990s, which used cap-and-trade. But that’s a completely different phenomenon from carbon emissions. Here’s why. Sulfur dioxide emissions are a flow pollutant. They don’t stay up in the air. In fact, they come down in the rain and cause acid rain. So if you put a current price on that pollution, you trigger a current decision to install smokestack scrubbers. You get the result that you want, which is reduction of sulfur oxides.

With CO2 though, you don’t want to define today’s level of CO2 emissions. What we really care about is emissions 20 years from now. What will our power system look like? Will we have made a fundamental transformation?

It actually doesn’t matter so much what we emit today because that’s already baked into our infrastructure: our energy systems, our buildings, our power plants, our cars. The question is, what are we going to have 20 years from now? And today’s price doesn’t determine that. The price 20 years from now does, along with the regulatory environment in effect then.

We need a different strategy. This is why Australia’s done the right thing to put a carbon tax, although they err by planning to convert it to a cap-and-trade system by 2015. Cap and trade does not make deeper, future choices evident. It’s not promoting the long-term technological changes that are needed.

Real costs, but ‘not worth wrecking the planet for’

As I said, climate change is just about the most complicated thing imaginable. Yet I should stress clearly, that if we really went to all the next-best energy alternatives—even using today’s technologies—we could probably de-carbonize the energy system substantially at a cost of maybe 2 percent of our GNP.

That’s a big cost. In the United States we’re a $15 trillion economy and so 2 percent is $300 billion a year of outlays. People would raise their eyebrows at that. But for a $15 trillion economy, that’s not such a big deal. It’s not worth wrecking the planet for.

The issue is complicated because it requires decisions. It requires collective action. It requires pathways. It requires a change of how we do things. It requires taking on vested interests. It requires new technologies.

That’s what makes it complicated, not that it’s going to break the world economy, or that it’s going to be the end of prosperity or anything like that. The only thing that could end prosperity is business as usual.

If we started the changeover now, at full-speed, with technologies we have right now, we could do it. The truth is we’d barely notice, although shareholders of some companies would take pretty heavy losses, a lot of Congressmen would be voted out of office. It might be quite interesting actually. But it would not break our economy or our society.

So there is fundamentally good news, which is that we have a lot of ways to proceed. We have a lot of solutions on the drawing board. Even though we will bear a cost to do this, we will still come out a happier, healthier, more robust society in the end, not only for having avoided the worst, but actually for having introduced more efficient, superior technologies.

We talked about green buildings and energy efficiency. I would add that electric vehicles add a startlingly exciting horizon for us in new forms of transport that are going to be much higher quality. Indeed, that newspaper that I like so much, The Wall Street Journal—except for its miserable op-ed section—had a wonderful insert today about the inevitability of self-driving vehicles.

As my engineering colleague says, it’s dangerous to text and to drive at that same time, so stop driving. That’s what the technology is going to allow us to do. And because it’s electric you can do wonderful things that you can’t do with mechanical transmission and internal combustion engines.

This is not the end of prosperity. This is actually an exciting avenue ahead but we’re going to have to take some decisions. We haven’t been able to take them yet. As I look around, my thought is that maybe Washington will be the last place to act on the planet, I’m sad to say.

Even within the United States, many places are moving ahead. They’re not waiting for China. They’re not waiting for Washington. They want to have a clean and responsible energy system even if it’s more costly for them right now. They know that ultimately the world’s going to have to move in that direction, and better to be an early mover than a late mover. I find all over the world that there are early movers who are ready to step up now.

Maybe we’ll feel better when we pay less attention to U.N. climate negotiations, of which I’m a part, where we wait for total unanimity, which never comes. Rather maybe we’ll feel better when we start championing those who will move ahead first. We should draw attention to them, give them support, and change the question to one of “Who can get there fastest?” In the end, those are going to be the ones that are going to benefit most.

Thanks very much. I’ll take questions now.

Can natural gas be a bridge to a lower carbon system?

With the right rules, yes. But we don’t have those rules in place today.

If there were a framework of a gradually rising prices on carbon emissions that started low today but rose predictably to a tens of dollars per ton of CO2 by 2025, that would be meaningful.

In this case, if decision-makers today were building power plants and thinking about the future—of the grid, of transport systems and the like, and could see ahead 20 years to know the impact of carbon costs on their decisions—then I think natural gas could well be used as a short-run substitute to replace coal and it could become a stepping stone.

Without that kind of plan, natural gas will become another entrenched, carbon-emitting infrastructure, protected by yet more vested interests. What we’ll probably do is build more dedicated pipelines and more dedicated infrastructure so that it becomes even harder to get off of the natural gas habit down the road.

As natural gas grows more profitable, it becomes bigger, and more entrenched. This is a very basic point: things that can be both profitable and very bad for us. This is because the profit is based on market prices. It’s not based on true social costs. When you have something like climate change, the environmental harm is an externality, and the market price is a miserable signal for what should be done.

Those who remain zealously committed to “market prices” do so denial of basic science. At this point, it is sheer willful propaganda that drives the skeptics. It’s not about scientific doubts. It’s not about what we’re observing, nor what we’re measuring, nor what our satellite systems are telling us, nor what energy balance data are showing us, nor what’s happening to ice sheets, nor what’s happening all over the world. This is willful denial because it’s profitable right now to deny it.

It’s really the height of irresponsibility given the moral implications for future generations. I don’t know whether they think their children are going to be in a different climate zone? A different Earth? Whether they think that climate change stops at the gates of their community? Whether it only affects poor people?

I don’t know what they’re thinking, but at this point it’s so bizarre, it’s beyond any normal behavior. It’s driven by a lot of money.

How will utilities evolve?

The utilities are not really the main agents of resistance actually. The utilities are regulated. They have a pretty straightforward mandated responsibility. If pricing were to change, they would change along with it. They’d be happy to run different kinds of power plants and many utilities are not resistant to these changes.

In fact some utilities have been part of the corporate coalitions on the side of pressing for a clear framework to reduce the carbon intensity. For many years a lot of utilities like Duke have said, “Give us the right price [including carbon]. We’ll make a different decision.” They’ve been very, very clear.

I don’t regard utilities as the main agents. They buy fuel so that they transform it, they’re not really playing the same role that the Koch brothers play or that the oil sector in general plays or the coal industry, which is really the powerful resistance in the country.

How can leaders better sell smarter climate and energy policy?

There are three things that can make proper energy and climate policy more palatable and they have not been done. One is the good, solid, economic logic to backload the carbon tax. Let it build up over time. There are rigorous economic reasons to do that, and it’s also politically correct.

Phase this in. This is not about today’s emissions. This is about the kind of energy system we will have in 2025 and especially the kind we will have in 2040. We have to make a technological transition that’s quite deep: to new energy systems, to new transport systems, to more efficient buildings.

A simple calculation shows the logic of what I think is the right political strategy also. You could promise today significant reductions in tariffs to give an incentive for the transition, and totally pay for those reductions with a back loaded carbon tax.

That would work because the current base of the clean technologies you aim to subsidize is tiny. As you increase the size of the renewable sector, you need a higher tax to pay for it. You can decrease the subsidy over time, and raise the level of the tax in parallel. If you keep constant the gap between subsidies for renewables and tax revenues from carbon, you’re always saying to industry:

There is going to be a $30 or $40 or $50 per ton CO2 advantage to go to the de-carbonized source. We guarantee that for the next 30 years. Today it will come via a big feed-in tariff. In the future it’ll come by a tax, and it will gradually substitute along the way.

Second, very closely related: I’m happy to have the future pay for a lot of this. This can be bond-financed. It doesn’t have to be current-financed because the future can bear some of this. It’s not only the current generation that needs these changes, so you can use inter-temporal fiscal policy—not in an irresponsible way, but to show that the load will be paid also by those who are going to bear the benefits of the cleaner environment,

The third point that I find completely missing right now is an idea of a framework and a plan. I’ve been involved in public policy for 30 years and have contributed to large-scale transformation.

You can’t tell the public that our plan is cap-and-trade. That’s not a plan. That’s frightening. That just means, “Oh. Our electricity prices are going up. What do you mean? Why? What’s that for? That doesn’t sound good.”

You have to explain to the public, “Look. We’re going to have better vehicles, smarter buildings, a smart grid. We’re going to be able to tap into renewable energy. We’re going to be able to get off of our Middle East dependency, and here’s how, quantitatively.”

I urged the Administration to do that in 2009. I went to the White House on several occasions and I put in my two cents to say, “Have a framework. Have a plan. Waxman-Markey is not enough. You have to explain not just the policy tool. You have to explain what America’s going to look like in 20 years, how we can live better, cleaner, more independent, longer-term resources and a safer climate.”

That is missing until today. And that, to my mind, is the biggest weakness here. It’s not leveling with the public. But it’s also not explaining that this is an all-grid story. There’s a lot of exciting new technology, exciting things to do. This isn’t going to break the economy.

I think the public would rally to this. Yes, the public would. The vested interest would not. To win this game is to win the public.

~

Check out the original post online here:

http://www.globalccsinstitute.com/insights/authors/adamaston/2012/11/27/jeffrey-sachs%E2%80%99s-bright-vision-climate-week

American Water: How energy shifting earns profits for a water utility | Corporate Knights

If they ever think of water works, most people imagine pipes and pumps – more Victorian age than high tech. After all, in most cities, the big facilities that filter our drinking water and process our waste are out of sight, out of mind. But ask Ron Dizy, president and chief executive of Enbala Power Networks, about North America’s thousands of water works, and he’ll tell you they represent an enormous reservoir of untapped, low-cost energy services potential.

Connected to Enbala’s smart-grid systems, water works is just the first category of big energy consumers that, by rapidly shifting when and how they use electricity, have the ability to help smooth out micro-fluctuations in the grid’s energy flows, displacing the fossil-fuelled generators that now perform this service. What’s more, Enbala’s software could boost renewable energy, too. It provides the kind of grid stabilization needed to help manage the variability of solar and wind energy as these sources make up more of the power mix.

Dizy’s vision is taking shape at a pumping station in Shire Oaks, south of Pittsburgh, Pennsylvania. That’s where American Water, the largest publicly-traded water and wastewater utility in the United States, is collaborating with Toronto-based Enbala. American Water has connected the pumps and compressors at its facility to Enbala’s smart-grid software, which can remotely turn the machines up or down to help keep supply and demand of electricity on the regional grid in constant balance. In the industry, this is called frequency regulation.

“Think of frequency regulation as a cruise control for the electric system,” explains Scott Baker, an analyst at PJM Interconnection, which manages a section of the U.S. grid spanning 13 states, plus the nation’s capital. To go a steady 60 mph, your cruise control imperceptibly adjusts gas and brakes to keep your speed constant. “Regulation services do the same thing, adding or reducing power on the grid to keep its frequency in balance,” says Baker. And like cruise control, which adds only spurts of gas or taps the brakes to control speed, regulation services require relatively small adjustments to do their job, with tiny doses of power added or consumed to stabilize frequency.

Conventionally, grid operators such as PJM have paid specialized generators to provide these balancing services. Because frequency regulation must be supplied in real time, all the time, these plants must be designed to be extra rugged, able to ramp up or down very quickly.

To be clear, regulation services are different from the so-called demand response. “You might call them distant cousins,” says Dizy. Demand response works when big energy consumers agree to switch off big users of power, with advance notice, for a few hours, a few times a year, when demand on the grid is greatest. On the other hand, regulation services are delivered on smaller scales, but are required 24 hours a day, every day, for minutes rather than hours, he explains.

Enbala’s solution turns the conventional approach on its head. Its software eliminates the need to generate electricity to balance the grid. It performs the same trick by managing electricity demand in real time. As such, the process can behave like a battery, Dizy notes. Rather than store energy in chemical form, as in a battery, Enbala describes its approach as “process storage,” where mechanical processes – such as filtering water – can be banked in advance of their use.

When, for instance, PJM needs a tiny increase in power use, Enbala requests that the pumps at American Water’s facility boost the flow of water into a holding tank by a few per cent. Or, if PJM needs power use to fall by a fraction, massive air pumps at the facility used to aerate wastewater treatment can be turned down. The adjustments are small – a few per cent up or down, for only a few minutes.

Enbala’s remote tweaking is designed to have no net effect on the water works’ processes. “At the end of the day, we’re just shifting when we use the power,” says Paul Gagliardo, manager of innovation development at American Water. Yet both companies earn a steady stream of payments from PJM for supplying the frequency regulation service.

The benefits for American Water have tallied up quickly. After less than a year working with Enbala, the water company reports that its total energy bill at the facility has fallen by two to three per cent. Happy with the outcome, it is now rolling out the system to 20 or so of its facilities.

Dizy’s company has identified many other industries that can provide regulation services by turning their processes up or down on the fly. “We’re just beginning to scratch the surface,” PJM’s Baker says.

See the original story here: http://www.corporateknights.com/article/american-water?page=show

Innovative funding for a groundbreaking CCUS plant: The financing behind TCEP’s polygen CCUS facility | Global CCS Institute

Over the past year, the Texas Clean Energy Project (TCEP) has emerged at the front of a small pack of US projects that aim to sell their CO2 to oil drillers. By doing so, TCEP may just re-write the rules of CCS, shifting the focus from government-backed sequestration efforts, to commercially-funded projects to capture and sell CO2 to recover oil and other industrial uses. This approach shifts CCS to CCUS (carbon capture utilisation and sequestration).

This reorientation was on display at the annual meeting of the Electric Power Research Institute (EPRI), the R&D arm of the US utility industry, in Pittsburgh in May, where for the first time petroleum engineers were present in tellingly large numbers. Testament to CCUS’ rise, the event was the stage for a major push on national policy to formally tie enhanced oil recovery (EOR) together with the goal of carbon capture. (Find details of the National Enhanced Oil Recovery Initiative (NEORI) at this post with two of the principles behind the initiative: Part I here, and Part II here).

TCEP emerged as another standout at the conference as a pioneering project that’s fully funded and on track to build a first-of-its-kind ‘poly-gen’ power plant, which converts coal into three saleable outputs: power, CO2 and industrial chemicals. I’ve written about TCEP previously here at the Global CCS Institute: first here in a Q&A with Laura Miller, former Mayor of Dallas, who has joined the team developing the project, and again in an update on the project’s progress.

At the May EPRI meeting, I got the chance to learn more about the innovative financing and business model that’s bringing TCEP to life. W. Harrison Wellford, chief executive of Wellford Energy, offered the perspective of the investment community on the project. As a financial advisor to the project, Wellford sees TCEP as a game changer in the way power generation has been conventionally developed and financed. Power plants aren’t just about electricity anymore. Think of it this way, he said: “We will pay about US$45 million for coal at mine mouth for this plant. That will produce at the end of day US$750 million in sales” of a mix of products. “You’re taking a very cheap fuel resource, and creating a valuable product through the alchemy of a plant like this.”

TCEP is drawing attention from beyond US shores. On 13 August, a group of Chinese investors including China Petrochemical Corp. (or Sinopec, China’s national oil company), announced it was in late-stage talks to invest US$1 billion to acquire an equity stake in the project. If completed, the deal would be the largest investment by China in the US power market to date, according to The Wall Street Journal. The move would advance a growing movement to link China’s rapidly expanding power sector with US advanced coal technologies. See this post for background on US-China joint efforts in CCS.

Sales outlook

To understand TCEP’s current financing, it’s necessary to first have a clear view on what the plant will produce. In his slides, Wellford explained that the project would yield three major streams of revenue: power, CO2 and urea. The following details are adapted from slides that Wellford presented.

  • Power – The plant will produce electrical output of 400 MW gross, with 160 MW net available for sale to the grid. The balance is consumed to drive CO2 and chemical manufacturing operations at the facility. Discussions for terms of the power off-take arrangements are set at 30-year, fixed price, as a base load generator in the Electric Reliability Council of Texas (ERCOT) and per volume terms set out in a power purchase agreement. ERCOT operates the regional grid, encompassing the state of Texas and a few bordering regions. At peak demand, ERCOT consumes over 65,000 MW.

  • CO2 – Sales of CO2 are expected to be set up as 15-year, rolling contracts. Wellford explained that the project has attracted interest from multiple parties in EOR markets, looking to draft contracts and sketch out term sheets. The revenue from these CO2 sales is not dependent on carbon legislation, Wellford emphasized. Pricing will be linked to market rates for West Texas Intermediate (WTI), a benchmark indicator for US oil markets. When up and running, TCEP will operate at a 90 per cent capture rate, yielding some 2.7 million tons of CO2 per year. The annual current demand for CO2 in the region for EOR is estimated to be more than ten times that amount, at 33 million tons. The CO2 will be qualified as Verified Emissions Reductions on the American Carbon Registry.
  • Urea – A major market participant  has contracted to take urea produced by TCEP, and includes the plants full annual production. In this case, prices will be tied to actual secondary sales to downstream consumers, subject to a floor, on the downside, and on the upside, to price sharing mechanisms. Urea production is predicted to hit 720,000 tons per year at full operation. Currently the US market for urea, used primarily as a raw ingredient in fertilizer, is 8.5 million tons per year. Of that, some 5 million tons are imported.

Financing

Wellford emphasized that getting TCEP off the ground has been as much a financial challenge as an engineering feat, and perhaps more so. He commented:

“To finance a project like this, we would typically go to power markets. But they don’t know anything about EOR. To go around the world and try to make a case for an Integrated Gasification Combined Cycle (IGCC) plant for risk, but to educate them in two other industries – chemical fertilizers and oil and gas – that’s a lot harder… We’ve made a lot of progress educating people on how this will work. And I think we’ll succeed, but it hasn’t been easy.”

The TCEP Project is fully funded through project financial close, Wellford said. As of his talk, the bulk (US$1.3 billion, or 52 per cent) of project finance, is coming from debt in the form of bonds and bank loans. The next largest share (US$845 million or 31 per cent) is from equity and tax equity. The balance (US$415 million, 17 per cent) is from an Energy Department grant. He pegged total project costs at US$2.995 billion.

Wellford emphasized the importance that tax benefits have played in bringing TCEP to reality. The project has tapped three separate federal tax incentives, the combined long-term benefit of which totals roughly US$1.49 billion. Here’s how they break down, according to Wellford’s slide:

  • US$313 million: Advanced Coal Program investment tax credit (ITC) at or before COD, awarded in 2010 and contract signed with IRS;
  • US$253 million: carbon sequestration tax credits possible over first 10 years; and
  • US$925 million: MACRS accelerated depreciation tax benefits over first 5 years.

Long-term prospects for CCUS

Wellford made a case that, longer term, CO2 demand in TCEP’s market will continue to rise, further improving TCEP’s financial performance. Responding to a question after his presentation, Wellford explained TCEP modelled its revenue projections at a price of around $20 per ton of CO2, but that market prices since then have risen to over $30 per ton.

In the Permian Basin, which includes West Texas and a few bordering regions, using CO2 for EOR has been going on for more than four decades. Currently, CO2 is moved throughout the region in a network of pipelines operated by Kinder Morgan, Trinity Pipeline and others. The bulk of CO2 transferred into the region comes from geological reservoirs in the Rockies or from CO2 stripped from methane during refinery. Annually about 33 million tons of CO2 is shipped into the region for injection; another 60 to 70 million tons is re-injected back into wells, from CO2 that surfaces with oil and gas.

Each ton of CO2 yields two to three barrels of oil.  Some of the region’s drillers such as Occidental Petroleum produce all of their oil using EOR. Yet the market is short of CO2, and apart from TCEP, there are no other viable sources of anthropogenic CO2 in the region at such a late stage of development. Current geologic CO2 sources are in decline, and while new geological sources have been identified, they are too distant to be economically delivered to the region.

Wellford Energy background

By way of background, Wellford Energy is a financial advisor to clean energy companies and projects in the US, Europe, China, and Latin America. The firm focuses on matching projects with private investment from domestic and international sources, and on non-dilutive public funding. The company focus on climate-friendly technologies, including CCUS, compressed air and other technologies to store renewable energy, and low-carbon transportation technologies. Its partners include Summit Power (which is developing TCEP), Kleiner Perkins Caufield & Byers, and Prometheus Capital Partners.

~

Check out the original post online here:

http://www.globalccsinstitute.com/insights/authors/adamaston/2012/09/12/innovative-funding-groundbreaking-ccus-plant-financing-behind

Meet the Change Makers: AEG Turns Up the Volume on Sustainability | OnEarth

You may not know AEG Worldwide, but odds are good that you’ve spent an evening in one of the company’s many venues, rooting for the home team or lip-syncing a favorite song. AEG operates and often owns some of the world’s largest stadiums, concert halls, and other entertainment sites, including L.A.’s Staples Center and the newBarclays Center in Brooklyn, where the Nets will soon relocate. The company’s portfolio also includes London’s O2 Arena, a hub for the 2012 Olympic Games. Off the field, there’s no bigger player in sports than AEG — which made the company a natural target for environmental advocates seeking a high-profile partner in efforts to “green” pro sports.

Worldwide, the sports and entertainment industry’s environmental impact is huge. Yet it has historically been made up mostly of small-scale players — each running just a handful of venues — so the shift toward environmentally friendly practices has happened more slowly than in other sectors, which could be influenced by just one or two big companies going green. Back in 2007, AEG’s footprint included just seven venues. Since then, backed by billionaire-owner Philip Anschutz, CEO Tim Leiweke has rapidly expanded the scale and diversity of the company’s activities. Today AEG manages and/or services more than 110 venues on five continents and owns a share of 10 pro teams that play in its arenas, including the NBA’s fabled Lakers. And the company ranks as the second-largest event promoter in the United States., backing events such as the massive Coachella music festival.

Given AEG’s size, its global sustainability director, Jennifer Regan, has unprecedented influence over the greening of the sports and entertainment industry. Regan joined the company fresh out of college in 2007 and has risen to become its senior-most executive focused on green issues. Her team started out looking at energy use at a small number of the company’s sites but has steadily expanded its focus to include more venues and more complex measures of consumption. In 2010, AEG published the industry’s first sustainability report and debuted a green strategy known as AEG 1Earth. An update is due by year-end.OnEarth contributor Adam Aston recently caught up with Regan following her visit to the White House for a ceremony celebrating the greening of professional sports.

Twenty-six is young to be leading the green efforts at a major company. How did you get there?

I had the perfect mix of entertainment and environmental background, but the decision to really dedicate myself to corporate sustainability took shape before my junior year. I spent that summer in Senegal at the National University Cheikh Anta Diop where I studied sustainable development. On the last day of class, I had one of those life-changing moments. The professor stood me up in front of hundreds of local students and said:

You’re here because you want to learn how to do sustainable development. But what you need to recognize is there is no such thing. The only regions around the world being developed sustainably are places where wealthy nations are extracting natural resources. If you care about reducing environmental damage, start by changing business practices back home.

That message made me question what the heck I was doing in Senegal. I realized that I had much greater opportunity to affect change back home by addressing unsustainable business practices. I returned to the U.S. and redirected my studies toward issues around corporate sustainability.

Your timing turned out to be very good to join AEG’s emerging sustainability efforts. How did you make your way there?

I started looking for a corporate sustainability position after graduation. I expected I’d have to start in a position outside of sustainability and then weave those values into my role. Given my background in theater and production, I was looking at AEG for event management jobs and hoped to bring sustainability into the AEG culture.

At the time my mother was AEG’s vice president of information technology. She was helping me consider entry-level opportunities. Out of the blue, her supervisor mentioned that the CEO, Tim Leiweke, had asked for help to understand how to “make AEG green.” My mom suggested to her boss that he and I speak so that I might give him some pointers regarding first steps.

How much did you have to sell the idea?

The thinking on these areas was already taking shape. Executives were increasingly hearing from AEG’s partners — artists, promoters, athletes, sponsors, governing bodies, and civic groups — that the company needed to find better ways to address the environment. I gave a very aggressive speech on the difference between greenwashing and being truly sustainable, and provided a list of links on sustainability practices. Then I went on to travel. I wasn’t thinking that what just happened was kind of a job interview.

About ten days later, I got an email from AEG saying, “We could really use your support,” and asking if I’d be interested in a two-month engagement to help coordinate a management committee to map out the start of a formal sustainability program for AEG. I was so excited that I cancelled my trip and headed straight back to L.A.

So this was the beginning of AEG’s major push into sustainability?

Yes. In two months, we put together a 120-page report that included ten pages of detailed tasks for each major division of AEG. We presented the report to AEG’s chairman, Philip Anschutz, and to Leiweke. They reviewed it and said, “This is exactly the right direction for the company.”

Mr. Anschutz made it clear to us that energy was his number-one priority. After labor, energy is AEG’s highest cost, and energy prices were near all-time highs. So it offered quick and potentially big savings. He also wanted us to focus on venues we owned and operated. They asked me to stay on as a contractor to begin implementation. About a year later, after the program had a couple of strong wins, they offered me a full-time position as sustainability manager.

What were your biggest obstacles rolling out this program?

AEG’s biggest challenge — and biggest opportunity — is our scale and diverse business model. We have so many different business segments: facilities, concerts, sports, live entertainment, and others. Our venues range from intimate clubs that seat as few as 500 to large stadia and entire “entertainment districts” able to hold up to 115,000. Each of these venues is a different age, with different geographical and climate challenges, varying energy grids, and different municipal infrastructures.

So our first priority was to better understand what was already in place and develop a measurement and reporting program that could identify energy-savings opportunities and monitor their progress across a diverse range of venues.

When you looked at energy use, what did you find?

Initially, we did a few energy audits and site audits at a cross section of venues to identify energy projects that might translate across the portfolio. We quickly realized that there were opportunities around utility bill management and energy procurement.

Two years later, in 2010, we partnered with Summit Energy [of Louisville, Ky.] to develop a global energy strategy for AEG. They helped us identify cost-saving opportunities through rate adjustment and billing accuracy, as well as opportunities to procure energy in open market. They provided software to track and analyze electricity, water, and natural gas use as an extension of their invoicing, bill payment, and carbon accounting services.

You set some ambitious goals. How’s it going?

Until we publish an update to our sustainability report later this year, I can’t be too specific about company-wide achievements. But, we are making major progress toward our targets for 2020, compared with 2007, in the area of energy, waste, and responsible sourcing. These goals include cutting greenhouse gas (GHG) emissions by 20 percent and achieving 75 percent waste diversion at ten focus venues and events.

Also, where we have direct control over purchasing, we’re aiming to spend half of our budget on what we call “high-impact” goods — those that have the greatest direct impact on human health and the environment — including more efficient lighting, greener janitorial products, high-performance cooling and heating systems, and recycled paper products.

What are some specific examples of AEG’s resource savings?

Right out of the gate, we identified opportunities for high-returns. In 2008, for instance, we installed solar panels at both the Staples Center and Nokia Theater in L.A., saving an average of $55,000 annually. The same year, we retrofitted about 500 urinals to be waterless at all of our Southern California venues. They are saving us more than 20 million gallons of water and some $70,000 in direct water costs each year.

A rule of thumb in sustainability is to eliminate waste first, then substitute green alternatives. How are you approaching this?

We think our staff’s ability to manage buildings more efficiently through small day-to-day tweaks is where we’re really going to make progress. For example, in 2010, through staff training and constant vigilance, we reduced their electricity usage by 30 percent and natural gas consumption by more than half atCitizens Business Bank Arena in Ontario, Calif.

Much of this challenge amounts to motivating staff to change long-standing habits. How do you do it?

The first step is to get them to understand the materials within their facility and their importance.

Take my battery bucket challenge. I’ve had a lot of operations managers tell me, “Sure we collect disposable batteries in our office but there are just not that many.” And I’d say, “I’m going to issue you a challenge. Put a battery bucket in three places where you don’t think there are batteries. Send out an email letting staff know about the new collection points. And let’s bet on how long it will take for that bucket to fill up.” They’ll say, “Oh, it’ll take a year.” It takes one, maybe two weeks, so I’ve won every time.

The second step is to work with them to help identify sustainable solutions.

How do you tackle those who are most resistant to change?

When it comes to sustainability, I think of my colleagues as fitting into three major categories.

There’s one group making decisions because they want to be recognized but also because the decision is in line with their values. Those are the one who are most supportive and easy to work with.

And then there are those focused strictly on success as defined by their job description and who do not necessarily value sustainability personally. These types aren’t necessarily embracing sustainability, but if it’s expected of them, they will get the job done.

Lastly, there’s the complete naysayer: the individual who disagrees with the philosophy of sustainability and doesn’t think human action adversely impacts the environment. They are only able to see results or conclusions that support their belief that the environment doesn’t need our stewardship. Even when we can prove that they’re going to save money, they’ll sometimes still find ways to say no. That’s where the high-level support has been so important: since the owner and CEO said make it so, this attitude simply is no longer acceptable.

~

TRUTH SQUAD Checking industry claims with NRDC’s sustainability experts

Influence often comes with experience. Yet, in the relatively young world of corporate sustainability, youthful energy can help catalyze change in large, slow-to-evolve organizations. AEG’s global sustainability director is a case in point. At 26, “Jen Regan is among the best arena greeners on the planet,” says Allen Hershkowitz, a senior scientist at the Natural Resources Defense Council, which publishes OnEarth.

Hershkowitz has spent the past decade coordinating some of NRDC’s most prominent institutional sustainability initiatives, spanning entertainment — such as the Academy and Grammy Awards — and professional sports, including national league-wide efforts to green baseball, basketball, football, and the U.S. Tennis Association.

As the world’s largest operator of major sporting venues, AEG has unparalleled resources to develop green practices, Hershkowitz says. For example, in Los Angeles, the company hopes to build an NFL stadium dubbed Farmers Field, planned as one of the most environmentally sustainable stadiums in the world, as well as the NFL’s first LEED-certified field. AEG has even pledged to make the facility carbon neutral in part by steering more fans onto public transit. In a notoriously car-crazed city, it’s an audacious goal.

AEG’s bid is typical of how its sustainability push has heated up a green race among teams and sports leagues, says Hershkowitz. “These owners are really competitive,” he says. “Each season, it seems like a different owner is trying to out-green previous efforts.”

The company’s green agenda extends beyond sports venues, but to Hershkowitz, sports is a particularly potent industry in which to promote sustainability practices. “Just 13 percent of Americans follow science, but 61 percent follow sports. If we can move things there environmentally, its popularity opens the door to much broader change at the political level.”

For all of AEG’s progress, there’s still plenty to focus on, Hershkowitz says. The company needs to extend its reach to smaller sites and deepen its influence over operations into new areas. For instance, AEG can work with independent and in-house vendors — which provide everything from popcorn to white-linen restaurant meals — to shift them to use more sustainable materials and even offer healthier foods, he says. — Adam Aston

~

Check out the original here: http://www.onearth.org/article/meet-the-change-makers-aeg-turns-up-volume-on-sustainability

Project update: Promising results of pilot tests for Codexis’ enzyme-based carbon capture system | Global CCS Institute

On 9 July, Codexis announced promising results from a pilot-scale demonstration of its enzyme-based carbon capture process at the National Carbon Capture Center in Wilsonville, Alabama.

The test, performed on flue gas from a Southern Co. coal-fired power plant, is the largest-ever successful demonstration of enzyme-based carbon capture. The capture rate was the equivalent of “1,800 average sized trees per day,” according to Redwood City (Calif.)-based Codexis.

Though better known for its work developing enzymatic catalysts for the production of advanced (cellulosic) biofuels, Codexis is also tapping its deep know-how in enzyme science to develop a carbon capture technology.

I first caught up with this project on behalf of the Institute last year, when CO2  Solution, of Quebec City, Canada renewed a collaboration with Codexis on biology-based carbon capture technologies.

This project began to take shape back in May 2010, when Codexis received US$4.7 million from the US Department of Energy’s Advanced Research Projects Agency – Energy (ARPA-E) program to exploit an active enzyme called carbonic anhydrase, or CA, which catalyzes the transfer of CO2 in nature.

Working with enzymes under license from CO2 Solutions, Codexis undertook an effort to rapidly improve the enzyme’s performance. The results: the largest improvement in enzyme performance in Codexis’ history, amounting to a two-million-fold improvement in thermal stability at temperatures between 140oF and 180oF (60oC and 82oC).

The CA enzyme show promise to perform at lower operating temperatures, lower pressures, and lower pH levels than many current and pending processes. A lower operating temperature promises to substantially reduce parasitic energy loss compared to current state-of-the-art monoethanolamine (MEA) technology.

The process shows potential upfront savings for materials, as well. “The benefit of being able to use carbonate solutions is that they’re some of the cheapest, most environmentally benign, most commonly used chemicals,” Alex Zaks, chief technology officer and vice president for research at the St. Louis-based biotech company Akermin told Tamar Hallaman of GHG Monitor. She noted:

Although enzyme-induced capture is still seen by the Department of Energy as an experimental technology, researchers conducting R&D work with the natural catalyst argued that enzymes could be the breakthrough technology needed to help usher in a cheaper and more efficient second wave of carbon capture technologies. “I think this technology can be a game changer,” said Zaks.

According to highlights presented in Pittsburgh on 11 July at the 2012 NETL CO2 Capture Technology Meeting, by Luan Nguyen, a technical engineering manager at Codexis, the system shows the promise to outperform comparable MEA systems by these measures:

  • reduce capex by about 9 per cent compared with a reference model, post-combustion carbon capture plant;
  • decreased parasitic losses of energy for carbon capture by about 30 per cent; and
  • enable a novel biocatalytic process for carbon capture that increases the levelized cost of energy (LCOE) by about 41 per cent, less than half the increase predicted for the state-of-the-art MEA process.

As to future steps that could take this technology closer to application, Nguyen mapped out three goals:

  • first, to design and scale-up process and equipment for a larger, 0.1–0.5 MWe slip-stream demonstration, up from the current 10kWe test system. A second-generation system, could potentially reduce the systems’ impact on LCOE to less than 35 per cent, from 41 per cent;
  • second, Codexis hopes to continue to evolve enzyme via its proprietary CodeEvolver technology to further improve system performance and lower production cost; and
  • lastly, the company is looking to engage with strategic partners to pursue commercialization.

For John Nicols, President and CEO of Codexis, the unprecedented large and rapid performance gains the company achieved during these trials highlights the potential for very dramatic gains for enzyme performance in carbon capture, as well as other industrial applications. “Codexis has pushed enzyme-based carbon capture technology to a level that surpassed all expectations,” Nicols said in a statement, “We’ve succeeded in demonstrating that this could be a viable solution.”

The announcement comes on the heels of Nicols’ appointment as new CEO in June. Nicols joined Codexis from Albemarle, a specialty chemicals firm, where he served as Senior Vice President, Strategic Development and Catalysts.

~

Check out the original post online here:

http://www.globalccsinstitute.com/insights/authors/adamaston/2012/08/22/project-update-promising-results-pilot-tests-codexis

Computer modeling identifies optimal zeolites that could slash parasitic energy loss, and costs, for CO2 capture | Global CCS Institute

Dramatic advancements in software efficiency, hardware speed, and modeling accuracy have helped scientists assess a huge database of some 4 million CO2 absorbing minerals, pointing the way to new, lower-cost carbon capture methods.

The researchers have identified a large group of extant and new zeolite materials that could help lower, by as much as a third, the parasitic energy costs associated with removing CO2 from power plant emissions.

Published online in May 2012 in the journal Nature Materials, the anlysis was developed by scientists from three institutions: the Electric Power Research Institute (EPRI), the Lawrence Berkeley National Laboratory (LBNL) at the University of California, Berkeley, and Rice University in Houston, Texas.

In the new study, researchers identified dozens of zeolites — many commonly used in industrial processes — that could significantly improve the energy efficiency of carbon capture technology.

“We believe we can beat current state-of-the-art carbon capture technology by about 30 per cent,” study co-author Michael Deem, Rice’s John W. Cox Professor of Bioengineering and professor of physics and astronomy said in a phone interview. Reducing parasitic power losses during CO2capture could increase a generator’s sellable electric power “by 10, or maybe 15, per cent” based on a back-of-the-envelope estimate, said Deem. “That’s a lot of money.”

The predicted performance gains are relative to current methods, where CO2 is bubbled through a bath of amines. To release the CO2, the amines are heated to boiling, and then the CO2 is compressed into a liquid to be sequestered or used otherwise. Up to one third of the power plant’s steam output is diverted to boil the amines and liquefy the CO2 for shipment.

Computer rendering of the carbon-capture characteristics of a zeolite structure. The arrangement of (red) oxygen atoms and (tan) silicon atoms influences the pore spaces, depicted as green, blue, grey colored surfaces, where CO2 can be captured. Credit: B. Smit/UC-Berkeley.

The new study used computational techniques to identify zeolites that promise to absorb and release CO2 using less energy. Deem explained that Zeolites are a good candidate for this role because they have long been studied, and are used industrially to refine gasoline, as well as to make laundry detergent and other chemically engineered products.

Speaking with GHG News, co-author Berend Smit, a professor of Chemical and Bimolecular Engineering at the University of California-Berkeley, explained:

This round of testing focused exclusively on parasitic load, or the energy penalty needed to separate the CO2 from flue gas, currently considered one of the major cost barriers to the commercial deployment of CCS.

[…]“If the parasitic energy doesn’t go down significantly, then it’s not worth looking at other properties,” Smit said. Of those 5 million materials tested, Smit said roughly 500 turned out to be “promising”…

Comprised mostly of silicon and oxygen, the performance of Zeolites varies by their nanoscale porosity. Made up primarily of silicon and oxygen molecules, the size and shape of pores vary by the geometric linkages made between molecules. In a chemical reaction, each pore acts like as microscopic reaction vessels, bonding and interacting with molecules that fit into the cavity.

The work of Deem et al., focused on sorting through a huge database of zeolite compositions. The roots of the work date back to 2007, when Deem and his colleagues used computers to calculate millions of atomic formulations for zeolites. Adding to this catalog since then, Deem’s database now contains some 4 million structures of zeolite.

In this latest study, the researchers pushed zeolite analysis to a higher level, using a new computer model designed by a team at Berkeley/LBNL to identify candidates well suited for CO2 capture. This model was refined with the addition of technical criteria of ideal carbon capture material, provided by technical experts at EPRI.

Coordinating Deem’s existing zeolite data, with new computational methods, add the additional CO2-capture characteristics, the team predicted the energy demands to capture and release CO2 for all the materials in the zeolite database.

Hardware advancements played a big role too. Given the complexity of the analysis, conventional computational methods using central processing units — or CPUs, the costly, complex chips that serve as the brain of most PCs — would have taken roughly five years to simulate each of the millions of zeolite models in Deem’s database.

Instead, the Berkeley/LBNL team adapted the model to run on graphics processing units, or GPUs, which are specialized, lower-cost processors typically used to render graphics in computers. Switching to GPUs, Deem explained, was integral to the project’s success: “It would have been unfeasibly large to do the old way. Instead of years, the calculation took about a month.”

The graph (below) summarizes the researchers’ findings. The green line gives the current cost of CO2capture through amine recovery. Red dots represent commerciall- available zeolites, while blue dots (both solid and circles) are predicted materials.

“The black curve is the envelope of the best possible performance, within zeolites,” explained Deem. “So if yours is close to this, you can be confident you’re close to best performance.”

The model suggests there are dozens of currently available Zeolites that promise to capture carbon at lower costs than current amine processes.  Speaking with GHG News, Smit explained the top candidates will go through further analysis to assess other criteria, such as diffusion limitations and reactions with water.

And if those fail to yield viable performance characteristics or are unavailable because of patent issues, Deem added, the model predicts a large number of viable compounds that can begin to be explored.

As industry begins to sort through the candidates his research has helped identify, Deem is looking forward to add still further attributes to his zeolite database, to further refine for CO2 performance as well as mapping out other potentially valuable chemical interactions.

The team’s research was supported by the Department of Energy (DOE), the Advanced Research Projects Agency-Energy (ARPA-E) and EPRI’s Office of Technology Innovation.

Check out the original post here: http://www.globalccsinstitute.com/community/blogs/authors/adamaston/2012/07/18/computer-modeling-identifies-optimal-zeolites-could

NEORI’s promise: Pairing utilities with big oil to revitalize CCS development – Part 2 | Global CCS Institute

It’s rare that a big industry has a major appetite for the waste of another huge industry. Yet when that happens, shouldn’t it be a no-brainer for the two to get together and solve one another’s problems?

In the case of carbon capture, the utility and oil sectors are trying to do just that – though with limited success to date.

The utility sector has a super abundance of waste CO2 it hopes to dispose of constructively. What’s more, it can benefit from deep-pocketed offtakers to help fund development of carbon capture systems.

Meanwhile, vast regions of the US oil industry are nearly desperate for fresh sources of CO2. to help drive oil out of ageing wells in a process known as enhanced oil recovery (EOR). Their current sources of CO2, mostly geologic CO2 reservoirs, are maxed out.

Yet so far, the two big industries haven’t been able to join forces on a large scale. This market mismatch may soon find a solution if a coalition led by the Center for Climate and Energy Solutions in Washington, DC can push through the National Enhanced Oil Recovery Initiative.

NEORI brings together key industry players from the oil and utility sectors and proposes a set of revenue-positive federal and state incentives that will help spur the construction of a first generation of carbon capture infrastructure on power plants and other industrial emitters, to feed the CO2 to the oil industry. As important, perhaps the effort has attracted bipartisan support in an era of near-paralysis on many political fronts.

To learn more the promise, mechanics and timing of NEORI, I connected with Eileen Claussen, President of C2ES, and Judi Greenwald, Vice President for Technology and Innovation at C2ES. The second half of our conversation follows. The first part was published last week..

What’s the potential impact of this approach on domestic oil supplies?

Eileen Claussen: NEORI estimates that our proposed new federal tax credit for captured CO2 capture will quadruple the amount of domestic oil currently produced annually through enhanced oil recovery –to 400 million barrels a year in the outyears – while cutting CO2 emissions by a total of 4 billion tons over the next 40 years. In addition, we will be generating new tax revenue for states and for the federal government, as I said, these incentives will more than pay for themselves. And we will be gaining vital experience and creating valuable infrastructure supporting broader deployment of carbon capture and sequestration in the future.

CO2 captured from varying sources – whether coal fired power plants, or industrial factories, or other – will come at different costs, yet we need to develop capture solutions for all of them. How does NEORI work to encourage development of CO2 capture from a range of potential sources?

Judi Greenwald: The cost of carbon capture at power plants and industrial facilities varies considerably. Also, CO2 capture technologies are in different stages of development, and as with any emerging technology, costs will fall over time after repeated demonstrations. This is why NEORI recommends establishing tranches and sub-tranches for different technologies under a competitive bidding process. The three main tranches would be a pioneer tranche, an electric power tranche, and an industrial tranche. The pioneer tranche would be for commercial-scale, ‘first-mover’ projects that would only move forward with sufficient government support to offset the technical and financial risk of CCS in both the electric power and industrial sectors. The other two tranches would be for projects using more advanced CCS technology in the electric power and industrial sectors. The industrial tranche would include sub-tranches for both lower-cost and higher-cost CCS technologies. Overall, the goal is to ensure that sufficient credits are allocated across all applications for CCS. This approach would take advantage of lower-cost carbon capture sources to pay for the incentives for higher-cost carbon capture sources. It would drive costs down in the tranches with the highest current capture costs, but take advantage of the sources with the greatest CO2 supply potential.

As proposed, NEORI promises to gain bipartisan support. This is remarkable in particular for a climate technology, and all the more so in an era of intense partisanship. How do the politics line up on this issue?

Eileen Claussen: At a time of economic struggle, fiscal crisis and political gridlock, we at C2ES believe the NEORI proposal is an encouraging example of how we can and must make progress on the climate and energy challenges we face. As much as we would like to see comprehensive solutions to our climate and energy challenges, those solutions are not on the immediate horizon. But if we come at these issues one by one, look for opportunities where interests converge, and are open to compromise, we can arrive at practical solutions benefiting our economy, our security and the environment.

At the Capitol Hill event where NEORI announced our recommendations in February, a bipartisan group of members of Congress were on hand to express their support. Given the political gridlock in Washington in this election year, it was reassuring to see lawmakers from both political parties step up and say they agree that this is important work. Senator Kent Conrad (D-ND) and Congressman Mike Conaway (R-TX) welcomed the NEORI’s recommendations at the Capitol Hill event. Senators Max Baucus (D-MT), Kent Conrad (D-ND), John Hoeven (R-ND), Richard Lugar (R-IN), and Congressmen Mike Conaway (R-TX) and Rick Berg (R-ND) released written statements of support.

Where are we on the timeline for NEORI? What next?

Eileen Claussen: Will we see comprehensive legislation on this issue pass the Congress this year? That’s unlikely. But we do think we have a shot at Section 45Q reform this year. Still, the NEORI recommendations have started the conversation and we feel optimistic that we can see progress on this issue in the not-too-distant future no matter who controls the Presidency and the Congress next year.

Rarely in the current political climate do Republican and Democratic lawmakers in Washington rally together in support of anything. So we need to make the most of this opportunity. Everyone who supports CO2-EOR has an obligation to educate their representatives in Washington and in state capitals around the country about the benefits this can deliver for our economy, our national security and the environment.

Scaling up CO2-EOR means bringing together vastly different business cultures – the oil industry and the utility sector – along with environmental groups. How do you bridge these gaps?

Eileen Claussen: The idea behind this initiative was to bring together a diverse group of stakeholders and try to come to agreement about what needs to happen to realize CO2-EOR’s potential. This is why the NEORI coalition includes industry, environmental advocacy groups, labor, and state officials who can work on both sides of the aisle and at both the state and federal level to stimulate the expansion of CO2-EOR.

Were these conversations easy? In a word, no. The diversity of the group meant we had some very tough discussions.

But in the spirit of the saying ‘nothing that is worthwhile is easy’, the final participants in this project stuck with it, and they reached consensus recommendations.

The petroleum industry regards CO2 from EOR as permanently stored. But for experts, policy makers, and regulators from the CCS world, this question is open. What do we know about the permanence of CO2-EOR?

Judi Greenwald: CO2 injection in EOR wells is regulated under existing policies and regulations. CO2 is contained by a series of physical and chemical trapping mechanisms over time. Experience from commercial-scale CO2-EOR projects, some of which have been in operation for decades, shows that CO2-EOR can be performed in a manner that is safe for both human health and the environment. The University of Texas Bureau of Economic Geology’s Gulf Coast Carbon Center has found no evidence of CO2 leakage from the SACROC oil field, where CO2 has been injected for EOR since 1972 (NEORI: CO2-EOR Safety).

Has there been any modeling on the net CO2 impact of this approach, given that units of anthropogenic CO2 are pushed into the ground to liberate units of petroleum CO2?

Judi Greenwald: To get at the net impact, the key question is: what would have happened otherwise? NEORI’s view is that CO2-EOR displaces other oil production that also would have resulted in CO2emissions, so any emissions benefit from the COcapture is a net benefit. Also, using captured CO2 clearly has net CO2 benefits compared to using naturally-occurring CO2.

With that said, there are a range of estimates as to how large the net emissions benefit is. For example, one study estimates that the Weyburn CO2-EOR project produces oil that is ’40 pe rcent carbon-free’ compared to conventional oil production due to stored CO2 emissions that offset tailpipe CO2 emissions (see Taglia, Enhanced Oil Recovery, July 2010, page 14).

We think more work is necessary in this area. It is necessary to better quantify the emissions benefit of CO2-EOR because it will help make the case for CO2-EOR.

See the original story here: http://www.globalccsinstitute.com/community/blogs/authors/adamaston/2012/07/10/neori%E2%80%99s-promise-pairing-utilities-big-oil-revitalize