Rest In Peace, old friend, your work is finished.......
If you want on or off the DIESEL "KnOcK" LIST just FReepmail me........
This is a fairly HIGH VOLUME ping list on some days......
Posted on 05/14/2007 7:43:30 AM PDT by Red Badger
Representative Rick Boucher (D-VA), Chairman of the Energy and Air Quality Subcommittee, and Representative John Shimkus (R-IL), this past week introduced a bill to promote the use of coal-to-liquids (CTL) transportation fuels. The legislation would establish price certainty to provide incentive for investment in CTL facilities.
The legislation introduced by Representatives Boucher and Shimkus would enable the Department of Energy (DOE) to enter agreements with up to six coal liquefaction projects for the purpose of establishing price parameters which will provide the projects with a federal price guarantee.
Under the legislation, if the price of crude oil falls below an agreed upon price— approximately $40 per barrel—the federal government would make a payment to the facility owner, thereby establishing a price floor for the facility’s product. Analysts consider $40 per barrel the threshold at which CTL becomes economic.
Conversely, if the price of crude oil were to rise above a certain ceiling, upwards of today’s market price per barrel, the facility operator would be required to make payments to the federal government. The legislation was established with both a floor and a ceiling to provide the necessary financial certainty to encourage the launch of coal-to-liquids projects while simultaneously insuring that participating facilities are not able to reap windfall profits simply by virtue of their participation in a program which lends federal backing in certain circumstances.
The exact price levels for the floor and ceiling as well as the amount of the payments would be established as part of each project’s agreement with the Department of Energy. In addition, the legislation requires that in order to qualify for this federal guarantee, each project must be certified as producing a fuel which has life cycle CO2 emissions of at or below the levels of a comparable petroleum-based facility.
Multiple lifecycle analyses (LCAs) of different transportations fuels point to standard coal-based Fischer-Tropsch fuels (FT CTL) as having the worst Well-to-Wheels (WTW) greenhouse gas profile. The recent study done by the University of California for the California Low Carbon Fuel Standard (LCFS), for example, calculated the emissions of CTL transportation fuel on a full lifecycle basis to be 214 g CO2 equivalent per MJ—2.3 times the impact of conventional reformulated gasoline or diesel. (Earlier post.) Baard1 Results of the INL-Baard study. Click to enlarge.
However, the US Department of Energy’s Idaho National Laboratory (INL) has just published a study modeling the greenhouse gas emissions of Baard Energy’s Ohio River Clean Fuels CTL project currently under development in Wellsville, Ohio.
The Baard project will co-feed the gasifiers with 30% biomass and 70% coal, and capture CO2 for sequestration. According to the year-long INL study, the Baard CTL fuels will yield 46% less emissions of greenhouse gases than conventional low-sulfur diesel transportation fuels. All emission reductions documented in the study were measured on a wells-to-wheels basis using the Argonne National Lab GREET (Greenhouse Gases, Regulated Emissions, and Energy Use in Transportation) model of transportation fuels.
Resources: Life-Cycle Greenhouse Gases and Urban Emissions from Fischer-Tropsch Diesel Fuels Derived from Coal and Biomass (Presentation)
Rest In Peace, old friend, your work is finished.......
If you want on or off the DIESEL "KnOcK" LIST just FReepmail me........
This is a fairly HIGH VOLUME ping list on some days......
KnOck!.....
The agenda of the environmentalists is not the environment. Their purpose is to destroy capitalism and the United States. They are evil.
Good. We need coal fuels. The best way to win the war on terror is shut off the money goiung to the middle east.
Time to Put up or ShutUp!........
Same idea back in 1973-74. No political will existed back then even though this technology was demonstrated. I think the threshold then was $35.00. Just think where we would be today if the program moved forward.
The ideal solution that would increase yield and decrease CO2 emissions, would be to co-locate nuclear power plants.< Coal to liquids and shale oil to oil both consume a great deal of their product producing the energies for the processes. Nuclear power can produce the energy needed to drive the process and at the same time generate electricity to feed the grid.
The real beauty of this is using heat directly from a reactor eliminates the efficiency losses in conversion of steam pressure to electricity in the steam powered turbines. The steam drives the process in coal or shale oil to liquids and any excess capacity can generate electricity.]
This is a win win win. The environmentalists will hate it.
Oh, that could happen.
What is smart about a technology that won't go anywhere without the government propping it up? How about this: Let the plant go out and sell calls on the price of oil, and use the proceeds to buy $40 puts.
It's not hard. It's called hedging, and is done by businesses all over the world every day. Why can't these plants do it?
Why bother rolling your own when you can buy one off the
shelf?
Here’s the place to buy.
http://www.eastman.com/Company/Gasification/Gasification_Intro.htm
Eastman chemical is in Kingsport TN and adjacent to the Rep Boucher coal producung district in southwest Virginia.
The hedging doesn't cost a lot of money when you are selling the calls to buy the puts.. its called a costless collar.
There is nothing wrong with guaranteeing an artificial floor for a while. The chance that oil prices will fall low enough to trigger the guarantee is low but investors remember the eighties and want to make sure that the government is serious about these new fuels this time.
There is something wrong with it if you believe that the government can't do a better job of investing or supporting investment than the private sector can.
The guarantee has a cost. This is why buying a put option is not free. All you are saying is that the risks of this endeavor should be borne not by the investors, who stand to reap a lot of money, but by the taxpayers i.e. me.
This is corporate welfare. It is the transfer of money (in the form of the bearing or risk) strait from my pocket to the pockets of the corporations doing this.
Which is fine, if you believe in government-private "partnerships" and other forms of corporate socialism.
yup
Only one risk, and one of the least likely to be a factor, is being born by the government.
Right, but it doesn't need to be, there are others i.e. the financial markets willing to bear the risk on what oil does. In fact billions and billions of the risk is placed every day.
And yes, they will get paid for it.
Apparently not.
If you want to see something done about America's dependence on foreign sources for energy, this is some of what you get. This is the taxpayer coming together with a problem that needs a solution and the taxpayer's government providing one.
Right. So, the private markets know best which projects to fund, etc etc. EXCEPT (insert whatever favorite project someone has at any give time).
There is a fortune to be made in cheap new sources of energy. It doesn't need the government, just as the government wasn't needed to develop petroleum.
Agreed... a transparent regulatory framework is crucial for capitalism.
And you can bet the government stands to gain from this. Local resources mined using local labor and produced locally....yup, they will get paid.
Yeah, but they would get that anyway if a private company bore the risk.
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