Friday, March 23, 2007

Army Ignores the Real Crisis

When I read the news article “Army Foresees Natural Gas Crisis” at defensetech.org I said to myself “this makes no sense.” Then the same article was posted on EnergyBulletin, which I regularly follow. I said to myself “now, this is going too far.” But when Platts made a story about it on March 20, 2007 “US Army concerned about price, availability of natural gas” I said “enough is enough” and decided to write a piece to demonstrate that the issue is exaggerated.

All those news are based on a call for study entitled “The Impact on the Army from the Changes in the World Supply and demand Situation for Natural Gas over the Next 25 Years” by the US Army’s assistant chief of staff for installation management.

Let me go back to what Platts said in its article and compare it with what is really said in the Scope of Work of the call for study.

Concerned that natural gas "may cease to be a viable fuel" because of its high and volatile price, the US Army will start looking at alternative energy sources to fuel its installations in the US and around the world, according to documents Platts has obtained.

Well well, Dear high respected Platts. Please read the scope of work carefully. It says “The study will be limited to use of natural gas on CONUS [continental US] installations and will exclude analysis of procurement for overseas installations, tactical applications or base camp locations.” Mistake number one!

Again Platts:

The Defense Energy Support Center said in its 2006 Fact Book that the Army spent $130.2 million on 15.5 million Dt [dekathermes] of gas in fiscal-year 2006. In FY-05, it spent $128.2 million on 16.4 million Dt.

Dear Platts, read the Factbook 2006 carefully. Page 19 of the Factbook gives DESC’s Net Petroleum and Natural Gas Sales. Page 20 gives Petroleum and Natural Gas costs. The numbers you give are NOT for the ARMY. It includes all DOD Services. Mistake number 2!

Now let’s have a look at the Army’s call for the above mentioned study.

Scope of Work states that

“the study will provide a basis for making future decisions on the use of natural gas for installation energy use and infrastructure investments in order to provide secure, reliable, cost effective utility service to Army installation missions.”
…..
“Current Army assumption is that Natural Gas may cease to be a viable fuel for the Army within the next 25 years based on price volatility and affordable supply availability”
…..
“The Army has greatly expanded the use of natural gas over the last decade, being the clean fuel of choice for heating plants and is still the fuel of choice for new construction.”

Really? How important is Natural Gas to DOD in general and to the Army in particular?

For that I consult once again my data sheets.

1. The share of Natural in DOD’s site delivered total energy consumption is no more than 8% and has never been more than 11%. Total DOD natural gas consumption went down from over 100 trillion Btu in 1985 to less than 70 trillion Btu in 2006.

2. You will say “wait a minute, the study is talking about installations and you show me total DOD.”

Right. Then look at the chart below. It says that Buildings and facilities make up no more than 30% of DOD’s total energy consumption.

3. Now you will say “hey, the study says, natural gas consumption in facilities only.”

Right. Let me show another chart. It says that Natural Gas consumption constitutes less than 32% of total energy consumed in buildings and facilities. And this share has been declining.

4. Now you will say “hey, weren’t we meant to talk about the Army?”

Right. Then have a look at the chart below. The Army makes up less than 40% of total energy consumed in total DOD buildings.

5. Now you will say “but how much of gas the Army use in buildings?”

My answer to that: Is it important? I gave big picture and made it smaller and smaller.

Let me re-quote the Army study proposal:

“Current Army assumption is that Natural Gas may cease to be a viable fuel for the Army within the next 25 years based on price volatility and affordable supply availability”
…..
“The Army has greatly expanded the use of natural gas over the last decade, being the clean fuel of choice for heating plants and is still the fuel of choice for new construction.”


And I would like to remind once more that Natural Gas consumption is peanuts compare to OIL, whatever DOD servives you consider. Furthermore, I do not understand why the DOD in general and the Army in particular closes its eyes in order not to see the biggest pain (which is oil) and looks at natural gas amount consumed in installations.

If DOD has anything to worry about and wants a real cure then it is OIL it has to concentrate on (especially OIL consumed by TACTICAL VEHICLES). Because it is there where the real crisis lie. Period.



Note: The data used in the charts given above are mostly derived from official DOD publications.

Tags: Military Oil Consumption, Department of Defense, US Army, Oil Consumption, Natural Gas

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