Wednesday, June 11, 2008

DOD and Alternatives to Conventional Oil

I normally do not quote much from one article. But there was an excellent article in the recent issue of Fuel Line by Jackie Cornet and Julian Bentley entitled "Can DoD Help budding biofuels industry grow?"

Here are the main points of the article:

"As the U.S. dependence on foreign petroleum grows – and much of that fuel comes from unstable parts of the world — Congress is focusing on opportunities to open, integrate, and diversify energy markets to ensure energy security. One key component of this energy strategy is promoting the use of biofuels, such as ethanol and biodiesel, as substitutes for conventional petroleum-based fuels.

Today, DoD uses a relatively large quantity of biofuels. In fiscal 2007, DoD’s use of the two primary biofuels — ethanol blended as E85 (85 percent ethanol and 15 percent gasoline) and biodiesel blended as B20 (20 percent biodiesel and 80 percent diesel) was roughly 1.1 million gasoline gallon equivalents and 5.1 million GGE, respectively. This usage makes DoD one of the largest customers to the biofuels industry; DoD represents nearly 10 percent of the E85 market and .6 percent of the biodiesel market.

Currently, biofuels are not capable of replacing the two largest components of DoD’s petroleum consumption, jet fuel and marine diesel. DoD does not use biofuels in aircraft due, in part, to the high cloud point of the currently-available biofuels. This cloud point may cause the fuel to gel and clog the engine as the aircraft climbs and temperatures decrease.

There is currently a lack of other biofuels (for example biobutanol and synthetic hydrocarbon-based fuel) suitable for aviation applications.

DoD also prohibits the use of biodiesel in marine vessels due to its hydrophilic characteristics or how it reacts to water, which may result in damage to engine fuel system components, accelerate fuel storage instability, and affect the fuel’s cold weather operating properties.

DoD’s use of biodiesel in military tactical vehicles is also prohibited at this time largely due to operational and mission readiness concerns.

Using biofuels in non-tactical vehicles
As a result, DoD’s potential to displace petroleum fuels with biofuels is limited to non-tactical vehicles. In fiscal 2006, these vehicles consumed only 1.4 percent of DoD’s annual petroleum usage. Over the past five years, DoD has done an excellent job increasing the number of vehicles capable of using biofuels in its NTV fleet. In fiscal 2006, of the 156,197 NTVs, 38,110, or 24 percent, were flex-fuel vehicles capable of using E85 and 32,277, or 21 percent, were diesel vehicles capable of using B20.
The same praise, however, cannot be given to the department’s use of biofuels in its biofuel-capable vehicles. E85 represented only 4.4 percent of fuel used by E85 FFVs, while B20 use in diesel vehicles was 33 percent. Biofuels comprised only 8.5 percent of the 81.2 million gallons of fuel consumed by DoD NTVs in 2006. This equated to .84 million GGE of E85 and 6.06 million GGE of B20.

There are huge opportunities to increase DoD’s use of biofuels in NTVs, and that this opportunity centers on increasing biofuel use in the current fleet rather than by expanding the composition of biofuel-capable NTVs.

However, commercial biofuels infrastructure is limited. Currently, there are only slightly more than 1,000 publicly accessible E85 stations and 600 publicly accessible B20 stations. Most of these stations are located primarily in the Midwest and far from DoD locations. Therefore, at most DoD locations, increasing biofuels use will require new biofuels refueling infrastructure be built on defense installations."

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I wrote on my blog hundred time. I write it again: DoD spends too much ink, money and time for alternatives to conventional oil. Surely, use of biofuels could bring some relief to DoD in terms of hiding its enormous energy consumption, some of which is unnecessary, useless, serves nothing, but costs money. Instead, efforts should concentrate on how to reduce consumption in tactical vehicles.

Why? Becaue energy consumption in non-tactical vehicles is quoted in miles per gallon whereas in tactical vehicles it is GALLONS per MILE. This measure explains everything.

I understand that DOD wants to reduce its reliance on convential oil. Efforts should focus on reducing consumption, NOT finding ways to replace conventional oil with alternative fuels and keep wasting energy. YEs, wasting energy. Just look at how fuel is wasted by unwise practices used in KC-135.

Ok. let me get back to the DOD's most fancy alternative to conventional oil, synthetic fuel.

In 2007 Air Force consumed over 2.6 billion gallons of jet-fuel (JP-8) which is equivalent to the amount of fuel U.S. airplanes consumed during WWII (between December 1941 and August 1945).

USAF wants its aircraft to fly on S-8 in continental US by 2016. One of the main motives is to wean USAF fleet from foreign oil by turning to domestic sources for supposedly cheaper and cleaner alternatives?

USAF has been used S-8 derived from natural gas but gas is also presicious and hence the attention now turned to coal.

Why? coal is a abundant domestic energy source?

How to use it in aircraft? By converting it into synthetic fuel using Fisher-Tropsch process.

Is the end product cleaner than conventional JP-8? Yes, when it is burned, but no when it is produced.

What does DoD do to attract private investment? Look for potential suppliers. Note that already 28 companies are willing to provide the fuel.

Is that cheaper? No, not yet. The companies want a long term contract (more than years) with the DoD. But current legislation allows maximum 10 year contract. That may sound reasonable. Afterall, it costs $10+ billion to build an F-T plant.

What else do the potential S-8 providers want? A fixed price. But, wait a minute. What happens if the cost of producing S-8 becomes cheaper in the future compared to today? Because the potential providers always that that technology will make S-8 cheaper. Yes, something wrong here…But one thing is clear, suppliers will make more profit…

Is it a big market? Well, if you consider that USAF accounts for 10% of the US jet fuel demand, yes, it is.

The rule does not change: follow the follow the money under the hat of environment.


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