Sunday, June 05, 2011

Congress Should Go Ahead with Coal-to-Liquids

On January 30, 2008, Oversight Committee Chairman Henry Waxman and Ranking Member Tom Davis requested information from Secretary Robert Gates on how the Department of Defense will comply with The Energy Independence and Security Act of 2007 (became law on December 19, 2007) barring the government from purchasing alternative fuels for vehicles and planes, such as fuels from a coal-to-liquids process or tar sands, if those fuels have higher greenhouse gas emissions than conventional fuels.

Section 526 of that law provides:
No Federal agency shall enter into a contract for procurement of an alternative or synthetic fuel, including a fuel produced from nonconventional petroleum sources, for any mobility-related use, other than for research or testing, unless the contract specifies that the lifecycle greenhouse gas emissions associated with the production and combustion of the fuel supplied under the contract must, on an ongoing basis, be less than or equal to such emissions from the equivalent conventional fuel produced from conventional petroleum sources.

I haven't seen the reply to that letter.

In February 2008 I questioned How will DOD Comply with the New Law. I asked the following: We know that Air Force continues certifying the B-52s, C-17s and soon B-1s to run on synthetic fuel. Does that mean that USAF has to drop the plan and forget millions of dollars spent until now?

This question made sense because:
A report from NAP (Liquid Transportation Fuels from Coal and Biomass: Technological Status, Costs, and Environmental Impacts) in 2009 argued that transforming the US transportation fuel system from domination by petroleum based fuels to supply by various domestic sources will take several decades. Two abundant domestic resources with potential for producing liquid fuels are biomass and coal. Although abundant supplies of biomass and coal can be produced, each resource has its own set of limitations and challenges. Unlike liquid fuels from biomass, liquid fuels from coal cannot, even with the use of carbon capture and storage, offer any greenhouse gas benefit relative to gasoline. However, liquid fuels from coal are probably less expensive than those from biomass unless the costs of greenhouse gas emissions are included.
Given the abundant domestic sources of coal, the Air Force would actually prefered CTL technology from a national security standpoint. However, environmentalists have opposed it as an insufficient alternative, claiming it generates cumulative greenhouse gas emissions greater than traditional petroleum fuels. Using these arguments, environmental groups convinced Congress to include a clause (Section 526) in the 2007 Energy Bill that essentially outlaws government use of fuel derived from CTL technology.

Legally, in other words, the Air Force can experiment with CTL but cannot buy it for operations. The certification process already under way for the GTL fuel will continue apace, but the current uncertainty of future oil and gas prices will slow down a full-on embrace of any single alternative synthetic blend. At this point, the military is exploring its options, but not committing to a particular path. The future of the U.S. energy mix is in flux.

Having a CTL plant at Malmstrom Air Force Base (Mont.) was a part of USAF’s broader strategy to wean the service off foreign sources of energy by utilizing a synthetic blend of aviation fuel that can be derived in part from coal, of which the US has great abundance. The Air Force called off its quest to establish a coal-to-liquid fuel conversion plant at Malmstrom. In January 2009 the service said it has determined after a thorough examination that the proposals it received for the CTL plant “are not viable.” Accordingly, it said it “will no longer pursue” the development of a plant that would be built and run by a private operator at the Montana base. The Air Force cited “possible conflicts” with the mission of the base’s 341st Missile Wing, which operates one-third of the nation’s Minuteman III ICBMs.
A 2007 report from the National Energy Technology Laboratory (NETL) concluded that a $5 billion investment in a commercial-scale coal-to-liquid facility located near coal deposits would pay itself off with oil priced at just $61 a barrel, including the cost of equipment to capture and compress carbon dioxide for injection into a pipeline. The estimate does not include the cost of burying the carbon dioxide or transporting the fuel to its markets. At least two synthetic-fuel production facilities were planned in the US, by Rentech and Baard Energy, intended to capture carbon dioxide that is released during the synthesis process and use it in enhanced oil recovery by injecting it into nearby oil fields. But nothing happened.
Things may change now.
H.R.1540 -- National Defense Authorization Act for Fiscal Year 2012 passed House on 26 May 2011.


Section 526 of the Energy Independence and Security Act of 2007 (Public Law 110-140; 42 U.S.C. 17142) is amended by adding at the end the following: `This section shall not apply to the Department of Defense.'.

If the US in general and the US military forces in particular really want to reduce their dependence on imported fuel this amendment is a good was forward.

But not many people think like that.

For instance, in their piece appeared in The Hill on 27 May 2011, retired Lt. General Norman R. Seip and co-founder of Environmental Entrepreneurs, Nicole Lederer, stress that
“Removing Section 526 would be a step backward for U.S. security and clean energy innovation (….) repealing Section 526 will sidetrack the process already underway at the Pentagon and simultaneously shatter any semblance of certainty in the commercial marketplace. Repeal would discourage innovation and force the military in to a deepening dependence on dirty fossil fuels with a giant price tag in lives and treasure. The military knows there are better options, and so does Congress. They should preserve Section 526.”
No Sir! This blind green mania and discrimination of alternative technologies based on dubious groundings must stop. Congress should go ahead with the change.

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