By Twanna Harps on April 8, 2014
We’ve seen it before. Tough talk in the early ‘70s for an energy independent America as OPEC’s oil embargo quadrupled the price of petroleum from $2.90 a barrel to $11.65 a barrel. Then, in close pursuit, came the second oil shock of 1980 as the Iranian Revolution halted oil shipments, skyrocketing prices from $13 to $34 a barrel. The same narrative unfolded as the oil crisis of 2000s forced crude prices to unseen thresholds, rising above $30 a barrel in 2003, peaking at $147.30 in July 2008. In all cases, the call for alternate and cleaner energy resources resonated throughout America.
The U.S. government responded by pumping research dollars into new energy and conservation technologies. According to Council on Foreign Relations, “some of these investments yielded little, including the billions of dollars that were sunk into synthetic fuel and nuclear fission. But other investments paid off. The remarkable growth in shale gas production in the 2000s can be partly traced to these federally funded programs and subsidies in the 1970s, 1980s, and 1990s, which led to breakthroughs in drilling, fracturing, mapping, and shale gas recovery. Of course, none of these policies or programs were designed to reduce carbon emissions.”
To the extent that energy consumption has global ramifications, it’s best to compare America’s energy inventory to the rest of the world. Enerdata’s study of the percent share of renewables (hydro, wind, geothermal, solar) by country, Figure 1, shows the U.S. trailing most developed and many developing nations. Of the 44 countries studied, America ranked #25 with a 12.3% share and #26 with a 13.7% in 1990 and 2014, respectively.
Figure 1: Percent Share of Renewables by Country – 1990 and 2014Source of Data: Enerdata
A recently released report from the U.S. Energy Information Administration gives further insight into the question – whether America is gaining or losing ground on renewable energy consumption (hydro, geothermal, solar, wind, and biomass) for electricity generation, Figure 2.
Over a 66-year period from 1949 through 2015, the U.S. showed negligible growth in renewable and nuclear energy generation. During the same time period, petroleum consumption grew at an erratic rate while natural gas and coal continued an upward trend until 2008 when natural gas consumption soared at the expense of coal utilization.
Furthermore, as a percentage of total fossil fuel consumption (petroleum, natural gas, coal), total utilization of renewable energy (hydropower, geothermal, solar (PV and thermal), wind and biomass) never exceeded 14% of U.S. energy inventory. Excluding conventional hydro power, which is generally not considered a renewable source of energy, renewables (biomass, geothermal, solar, wind) constituted only 7% of America’s energy mix.
Figure 3 presents the U.S. consumption of renewable energy (in trillion Btu) by source from 1949 to 2015. Over the 66-year period, hydropower and biomass (wood energy, waste energy and biofuels) were the bastion of renewable energy production, averaging a combined total of 96% of all renewable resources throughout the period. The remaining 4% consists of geothermal, wind, and solar.
The consumption of wind and bioenergy started to rise by mid 2000s, growing from less than 1% of renewable energy generation in 2000 to 19% of by the start of 2016. Solar production lagged behind until early 2010s when the influx of cheap modules started to come online.
Nevertheless, by yearend 2015, the combined share of wind and solar power generation only amounted to 2.4% of the total primary energy consumption in the U.S., Figure 4.
The demand for wind and solar energy is driven by several factors? While, one can point to political survival, social awareness, economies of scale, and technological improvements; the answer lies in the levelized cost of electricity (LCOE). Here, the LCOE of renewable energy plummeted to levels on par with the price of purchasing power from the electricity grid, i.e., reached grid parity.
LCOE represents, the per kilowatt-hour cost of building and operating a generating plant over an assumed financial life and duty cycle. LCOE takes into consideration overnight capital costs, fuel costs, fixed and variable operations and maintenance costs, financing costs, and projected utilization rates for each type of facility.
Lazard’s Levelized Cost of Energy Analysis shows a decline of more than a 100% in the unsubsidized LCOE of wind over the past six years, reaching grid party with traditional energy sources such as coal, nuclear and gas in America by 2015, Figure 5.
Much of the cost reduction in wind and solar power lies in more efficient wind turbines, an oversupply of PV solar panels from China, and federal and state incentives. The American Recovery and Reinvestment Act of 2009 provided three federal incentive programs for renewable electricity projects – Renewable Electricity Production Tax Credit (PTC), Business Energy Investment Tax Credit (ITC), and Section 1603 Cash Grant for Renewable Energy (1603 Grant). Congress, however, enacted only temporary incentives for all renewable energy projects.
The EIA reported, “From fiscal year 2010 through fiscal year 2013, the largest increases in federal energy subsidies were in electricity-related renewable energy, which increased from $8.6 billion to $13.2 billion. Total federal energy subsidies declined 23%, from $38 billion to $29 billion due to the expiration of tax incentives for biofuels, the depletion of stimulus funds, and a decrease in energy assistance funds.”
Also, “Domestic wind farm development thrived under the PTC and ITC, resulting in a lowering of cost by more than half over the course of the past five years and driving the U.S. to become the top wind energy producer in the world. Expiration of wind tax credits in 2013 dropped construction of new wind farms by 92% and resulted in the loss of 30,000 industry jobs. Following the renewal of the PTC in 2014, U.S. wind energy jobs increased by 23,000,” according to Renewable Energy World.
The PTC is a per-kilowatt-hour (kWh) tax credit for electricity generated and sold by qualified energy resources during the taxable year. The PTC, first enacted in 1992, has been extended ten times. This Includes Congress’s December 2015 approval to extend the PTC through 2016, after which it will decline each year until it fully expires in 2020.
The ITC allows owners of PTC-eligible renewable projects to earn a one-time corporate investment tax credit (ITC) in lieu of claiming the PTC. The ITC is equal to 30 percent of the costs attributable to the facility, which typically excludes other project costs, such as transmission equipment or ancillary site improvements.
The 1603 program offered renewable energy project developers cash payments in lieu of the ITC. The value of a grant is equivalent to 30% of the project’s total eligible cost basis, in most cases. The program allows taxpayers to maximize the return and value of existing tax incentives. The Federal government reported, as of December 31, 2015,
- total number of projects funded under 1603 = 104,211
- total 1603 funding = $24.9 Billion
- total estimated private, regional, state, and federal investment in 1603 projects = $90 Billion
- total installed capacity of funded projects = 33.3 GW
- total estimated annual electricity generation from funded projects = 88.7 TWh (roughly equivalent to 8,110,000 homes).
Lesser-known are twelve fossil fuel tax incentives covering production and consumption tax incentives in the U.S. All subsidies are permanent provisions in the tax code.Combined, these fossil fuel provisions totaled USD 4.7 billion in annual revenue cost and include:
- Expensing of intangible drilling costs
- Percentage depletion for oil and natural gas wells
- Domestic manufacturing deduction for fossil fuels
- Two-year amortization period for geological & geophysical expenditures
- Percentage depletion for hard mineral fossil fuels
- Expensing of exploration and development costs for hard mineral fuels
- Capital gains treatment for royalties of coal
- Deduction for tertiary injectants
- Exception to passive loss limitation for working interests in oil and natural gas properties
- Enhanced oil recovery credit
- Marginal wells credit
- Low Income Home Energy Assistance Program.
These incentives are only part of the story. There exist hidden incentives with deeper pockets.
A July 2014 report by Oil Change International, stated; “In addition to exploration and production subsidies to oil, gas, and coal companies, the U.S. government also provides billions of dollars of additional support to the fossil fuel industry to lower the cost of fossil fuels to consumers, finance fossil fuel projects overseas, and to protect U.S. oil interests abroad with the military. In 2013, the U.S. federal and state governments gave away $21.6 billion in subsidies for oil, gas, and coal exploration and production. President Obama has repeatedly tried to repeal some of the most egregious of these subsidies, but these attempts have been blocked by a U.S. Congress that has been bought out by campaign finance and lobbying expenditures from the fossil fuel industry.”
If America’s push towards alternate energy was to reduce greenhouse gas emissions, then it’s an apparent failure, Figure 6. The good news, if any, is a slight decline in GHG emissions in recent years. The bad news is emissions in 2013 were somewhat higher than that in 1990.
Figure 6: U.S. Greenhouse Gas Emissions by Gas, 1990 – 2013Source: U.S. EPA, 2015 https://www.epa.gov/climatechange/ghg-emissions/usinventoryreport.html
In closing, energy security exists in the U.S. today not by a hefty diet of alternative energy but by increased production of domestic petroleum and natural gas. But energy security is only one part of America’s energy vision. The other is a cleaner environment. The fundamental issue is whether the U.S. can expand renewable energy production at a rate that significantly cuts into the inventory fossil fuels. As ideological divisions widen on Capitol Hill, America’s energy policy becomes more reactionary and untethered to any long-term strategic plan. That is of course if one believes the carbon footprint from the combustion of fossil fuels is an environmental asset.
This piece is reprinted in its entirety from an article by Andrew Freedman, that appeared in mashable.com on March 12, 2016.
February was Earth’s most unusually warm month on record, blowing away the record that had been set just one month prior.
The new findings, contained in preliminary data released Saturday by NASA and backed up by information from other research groups, show that the combination of a record strong El Niño event in the tropical Pacific Ocean and human-caused global warming drove global temperatures to levels never before seen since instrument records began in 1880.
The NASA data, which is subject to adjustment as scientists refine their analysis, shows that February had a global average surface temperature of 1.35 degrees Celsius above the 1951 to 1980 average, or 2.43 degrees Fahrenheit above average.
The 1.35-degree Celsius temperature anomaly in February beat the anomaly recorded in January, which itself was a record high departure from average for any month. According to NASA, the global average surface temperature during January was 1.14 degrees Celsius above average, or 2.3 degrees Fahrenheit, compared to the 1951 to 1980 average.
This means that temperatures in February 2016 had the largest departure from average of any month in NASA’s records since 1880.
To put it more plainly, February stands out for its unusual heat more than any other month in modern climate record.
The previous warmest February, according to NASA, was in 1998, which was also a year with an extremely strong El Niño.
However, in an important indication of how far human-caused global warming has shifted the baseline state of the planet’s climate, February 2016 came out 0.846 degrees Celsius, or 1.52 degrees Fahrenheit, warmer than February 1998, despite the similar intensity of the El Niño events in both years.
In fact, studies indicate that with the highest levels of carbon dioxide in the Earth’s atmosphere in all of human history, global average temperatures may now be higher than any time since at least 4,000 years ago.
In an indication of how striking February’s data is, consider the reaction of Gavin Schmidt, the director of NASA’s Goddard Institute for Space Studies (GISS), who helps conduct these analyses:
What started as a precursory investigation into the U.S. Department of Energy’s imbalance of appropriations between the Office of Atomic Energy Defense and the Office of Energy Efficiency and Renewable Energy, turned into a deeper examination of DoE’s effectiveness of transitioning America to a more sustainable and environmentally friendly energy economy.
Without exception, the DoE is all about Atomic Energy Defense (AED). Energy Efficiency and Renewable Energy (EERE), on the other hand, is not mission critical. To the extent that the Energy Department’s FY 2016 congressional budget request allocates 63% of its total budget to AED activities and only 9% to EERE programs, energy efficiency and renewable energy programs appear to be at an extreme disadvantage. This concern is also mirrored in the Enacted DoE budget for FY 2015 where 64% was allocated to AED activities and 7% for EERE programs.
The argument is not whether AED is more important than EERE; rather it is a question of the horsepower behind EERE and the Energy Department’s performance in “ensuring America’s security and prosperity by addressing its energy, environmental and nuclear challenges through transformative science and technology solutions.” Unfortunately, no government-approved standardized measures exist to quantify the success or failure of the AED activities and EERE programs.
The DoE and in particular their Office of AED has significant challenges. When it comes to just one of the many activities under the Office of AED – the cleanup of abandoned mine lands – the task is highly complex and seemingly endless. There are estimates of as many as 500,000 abandoned mines – coal, hardrock, uranium, and others mines such as iron, phosphate, sand, gravel, clay pits and quarries – in our nation.”
When it comes just to uranium mines, the DoE is responsible to “provide for the disposal, long-term stabilization, and control of uranium mill tailings in a safe and environmentally sound manner and to minimize or eliminate radiation health hazards to the public. Currently, the DOE is charged with “completing surface reclamation at 24 inactive uranium mill tailings piles and the cleanup at 16 uranium recovery facilities licensed by the Nuclear Regulatory Commission.” This is just the tip of the iceberg. “There are about 4,000 mines with documented production, including 15,000 mine locations with uranium occurrence in 14 western states.’
According to the DoE, “The Office of Energy Efficiency and Renewable Energy (EERE) is the U.S. Government’s primary clean energy technology organization. EERE works with many of America’s best innovators and businesses to support high-impact applied research, development, demonstration, and deployment (RDD&D) activities in sustainable transportation, renewable power, and end-use energy efficiency. EERE implements a range of strategies aimed at reducing U.S. reliance on oil, saving American families and businesses money, creating jobs, and reducing pollution. EERE works to ensure that the clean energy technologies of today and tomorrow are not only invented in America, but also manufactured in America.”
The Department also states, “The FY 2016 Budget Request includes robust funding levels for clean energy technologies that advance American leadership in nuclear power, fossil energy, renewables, efficiency, and grid security for the 21st century. To sustain the Nation’s primacy in scientific discovery, the Request also increases funding for basic research.”
Figure 1 shows funding levels by Apportions allocated for the Department’s FY 2015 Enacted Budget and the FY 2016 Congressional Budget Request; $27.4 billion and $29.9 billion, respectively. The top section is a high-level view; segmented into five major areas of investments:
- Atomic Defense Activities,
- Energy Programs (not including EERE),
- EERE Programs,
- Power Marketing, and
- Adjustments (Discretionary Payments, Excess Fees and Recoveries – FERC).
EERE appropriations consist of four primary areas:
- Sustainable Transportation,
- Renewable Energy,
- Energy Efficiency, and
- Corporate Support.
The last section of Figure 1 contains all other Energy programs, and expenditures.
Figure 1 shows:
- FY 2015 EERE enacted investments of $1.9 billion, 7% of the total budget;
- FY 2016 EERE requested investments of $2.7 billion, 9.1% of the total budget t, a 42% increase from FY 2015;
- FY 2015 enacted funding levels for AED activities ran about 820% of EERE Programs;
- FY 2016 requested funding levels for AED activities run about 600% of EERE Programs;
- The EERE Vehicle Technologies program received the largest amount of fund in the enacted FY 2015 and the requested FY 2016 budgets, $280 million and $444 million, respectively;
- FY 2015 enacted investments in Renewable Energy programs are $456 million or 1.7% of the total DoE budget;
- FY 2016 requested investments in Renewable Energy programs are $645 million or 2.2% of the total DoE budget, an increase of $189 million from FY 2015 levels;
- FY 2015 enacted investments in Energy Efficiency programs are $642 million or 2.3% of the total DoE budget; and
- FY 2016 requested investments in Renewable Energy programs are $1.0 billion or 3.4% of the total DoE budget, an increase of $387 million from FY 2015 enacted levels.
When viewed from the standpoint of the Solyndra Scandal, the solar-panel maker that defaulted on a $535 million loan guarantee from the Energy Department, appropriations for EERE programs seem rather thin.
Figure 2 illustrates the relationship between the total DoE and EERE congressional budget requests from FY 2000 through 2016. The total DoE budget for any one year is indicated by the red columns; the total EERE appropriation by the blue columns. The callout above each blue column gives the percentage of EERE appropriation to total DoE budget for that year. EERE allocations ranged from a low of 1.4% in FY 2003 to a high of 9.8% in FY 2014. EERE allocations averaged about 5.8% during the 17-year period, with a slight upward trend in the latter years, though never exceeding 10%.
Figure 3 shows FY 2012 to 2016 EERE budget allocations for each of the 14 programs. In general, for any given program, there is little difference between the yearly allocations from FY 2012 to 2016, i.e., little variation in yearly investment for any one program. Major expectations are Vehicle Technologies, Advanced Manufacturing, and Weatherization and Intergovernmental Programs, all of which showed an increase in funding after 2013. Of the 14 programs, the DoE consistently invested the most in Vehicle Technologies and the least in Strategic Programs. Within Renewable Energy, the lion’s share of investments went to Solar projects. When combined, the three Corporate Support activities (Facilities and Infrastructure, Program Direction and Strategic Programs) absorbed about 12% of all EERE dollars.
In general, the yearly allocations for any one program or expenditure show only minor changes from 2012 to 2016. Exceptions are Vehicle Technologies, Advanced Manufacturing, and Weatherization and Intergovernmental Programs, all of which spiked after 2013. Of the 14 budget items, Vehicle Technologies receive the most dollars and Strategic Programs the lowest. Within the Renewable Energy category, Solar receives the lion’s share of investments. Energy Efficiency distributions show similarities within the later years between Advanced Manufacturing, Weatherization and Intergovernmental programs, and Building Technologies. Combined, the three Corporate Support activities (Facilities and Infrastructure, Program Direction and Strategic Programs) took about 12% of all dollars earmarked to EERE.
The FY 2016 budget request also contains an appropriation item – Fossil Energy Programs. Investment in these programs is approximately $842 million; 30% of the total EERE request. Fossil Fuel Programs include:
- Clean Coal Technology,
- Fossil Energy Research and Development,
- Naval Petroleum and Oil Shale Reserves,
- Elk Hills School Lands Fund,
- Strategic Petroleum Reserve, and
- Northeast Home Heating Oil Reserve.
The request “provides for the development of advance carbon capture and storage and natural gas technologies. The $257 million for the Strategic Petroleum Reserve, $57 million above the FY 2015 Enacted level, is allocated to increase the system’s durability and reliability and begin addressing the backlog of deferred maintenance.”
“Fossil Energy Research and Development (FER&D) advances technologies related to the reliable, efficient, affordable, and environmentally sound use of fossil fuels that are an important component of the President’s “All of the Above” energy strategy to ensure our Nation’s security and economic prosperity. FER&D leads Federal research, development, and demonstration (RD&D) efforts on advanced carbon capture and storage (CCS) technologies to facilitate achievement of the President’s climate goals. FER&D also conducts research and development (R&D) associated with the prudent, safe, and sustainable development of our unconventional domestic resources.” When compared to FY 2016 EERE appropriations, FER&D funding levels are 66% and 26% greater than Solar Energy Programs and Vehicle Technologies, respectively.
Science Program appropriations at $5.3 billion for FY 2016 is the single largest Energy Program expenditure outside of Weapons ($9.2 billion) and Defense Environmental Cleanup ($5.6 billion) Activities. “Science (SC) is the single largest supporter of basic research in the physical sciences in the United States and funds programs in physics, chemistry, materials science, biology, environmental science, applied mathematics, and computational science. The Office of Science portfolio has two principal thrusts: direct support of scientific research, and direct support of the design, development, construction, and operation of unique, open-access scientific user facilities. SC supports researchers at all of the DoE laboratories and approximately 300 universities and other institutions of higher learning nationwide. Approximately 31,000 researchers from universities, National Laboratories, industry, and international partners are expected to use SC user facilities in FY 2016. SC programs invest in foundational science, including basic research in clean energy, to transform our understanding of nature and support advances in fundamental science and technology innovation.”
One note of caution about reading too much into the DoE FY 2016 Congressional Budget Request. Like most budgets, there are differences between submitted and approved. Figure 4 shows these changes in the FY 2015 budget – the most recent year where both requested and enacted budgets are available. While the total DoE enacted budget was 1.9% lower than the request, the highest reduction in an appropriation line item was EERE programs at 17.4%. This is also true in terms of dollars. The total budget reduction of $538 million was primarily due a $402 million drop in allocations for EERE programs. The Atomic Energy Defense request of $17.7 billion was only reduced $133 million, a mere 0.7% change.
Using total renewable energy capacity as a measure of DoE’s effectiveness in transitioning the U.S. to a low-carbon secure energy future, America’s prowess is unquestioned. According to the Renewable Energy Policy Network (REN), by the end of 2014, the seven countries with the highest capacity of renewable energy (not including hydro power) are China, the United States, and Germany followed by Italy, Spain, Japan, and India, Figure 5.
REN states “By dollars spent, the leading countries for investment in 2014 were China, the United States, Japan, the United Kingdom, and Germany. However, considering investments made in new renewable power and fuels relative to annual GDP, top countries included Burundi, Kenya, Honduras, Jordan, and Uruguay. The leading countries for investment per inhabitant were the Netherlands, Japan, Uruguay, the United Kingdom and Ireland and Canada (both about even).”
Another, possibly more meaningful, measure to determine DoE’s effectiveness in transitioning the U.S. to a low-carbon secure energy future is the share (percentage) of electricity production from renewable energy (hydro, wind, geothermal and solar) to total electricity production.
This measure gives an entirely different picture from capacity statistics. Enerdata – a provider of energy data, forecasts, market reports, research, news, consulting and training on the global energy industry – established the data used Figure 6 – the percentage of renewables in electric energy production by country. Figure 6 shows the 2014 share of renewables in electricity production (including hydropower) by countries. The red column indicates the U.S. share (13.7%). Norway with a 98% share is the world leader and benchmark towards 100% renewable energy. The data set includes:
- 44 Countries,
- OECD Countries (The Organization for Economic Co-operation and Development),
- G7 Group of Counties (Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States),
- BRICS Countries (emerging national economies of Brazil, Russia, India, China and South Africa),
- CIS (The Commonwealth of Independent States formed when the former Soviet Union, now called Russia, dissolved in 1991), and
- 10 Regions (Europe, European Union, CIS, America, North America, Latin America, Asia, Pacific, Africa, and the Middle-East). Note: America includes the sovereign states that are located landmasses of North America and South America.
Not including conventional hydropower as a renewable source of energy, U.S. Energy Information Administration (EIA) data shows America’s makeup of renewable energy is below 10%. In contrast to Enerdata’s statistics that includes hydropower, EIA’s 2014 data shows 8% renewables (wind, solar, biomass and geothermal), Figure 7. Coal (39%) and Natural Gas (27%) dominated US electricity energy production capacity. Nuclear (19%) edged out Hydroelectric (6%) and Renewables (7%). Renewable electricity output consisted of Solar (4%), Biomass (2%) and Solar (1%). Electricity production from Geothermal was essentially nil. Note, other countries generating hydropower would also show a lower share of renewable energy .
Conventional hydropower is not considered a renewable source of energy. Unconventional hydropower using currents, waves, and tidal energy to produce electricity is less disruptive and qualifies as renewable. Conventional hydropower refers to the use of dams or impoundments to store water in a reservoir. Argument against qualification of available hydropower renewable is that most hydroelectric facilities were built long before the adoption of regulations that require states to increase production of energy from renewable energy sources, such as wind, solar, biomass, and geothermal. Another argument points out that traditional hydroelectric plants interrupt the flow of rivers and can harm local ecosystems, and that building large dams and reservoirs involves displacing people and wildlife. 
From the perspective of the role of renewable energy in total electricity output, the United States with the second highest installed capacity of renewable energy in the world, falls short at 13.7% with hydro and 8%, without hydro. Of the 44 counties in the study, 26 had a higher percentage of renewables than the U.S. This included such countries as Canada, Romania, Nigeria, China, India, Russia and Mexico. The U.S. share of renewables was also below the average share for the World, OECD, G7, BRICS, Europe, European Union, CIS, America and North America.
Most developed countries showed higher rates of renewables in their energy mix than U.S. Countries with developed economies that fared worse than the U.S. include the Netherland, Poland, Australia, the Czech Republic, and South Korea. Poland and the Czech Republic are way less developed then most western European countries and South Korea was accepted as a developed country as of 2015.
Figure 8 displays the share of renewable energy by country on a world map. Countries are shaded in proportion to their share of renewable energy, i.e., the darker the shading, the higher the share.
Figure 9 presents the U.S. share of renewable energy (including hydro) from 1990 to 2014. America’s contribution of renewable energy averaged 10.9% over the 25-year period. Overall, from 1990 (12.3%) to 2014 (13.7%), the U.S. increased utilization of renewable energy by 1.4%. The highest percentage of renewable energy to the electric power mix was 13.7% in 2014, the last reporting year. The lowest level was 7.8% in 2001. The last four reporting years experienced an upward trend approaching a 14% share.
The other major program under EERE is the Energy Efficiency. Useful statistics are available from The 2014 International Energy Efficiency Scorecard published by the American Council for an Energy-Efficient Economy, Figure 10. The Scorecard evaluates “the energy efficiency of world’s 16 largest economies The council looked at 31 metrics divided roughly in half between policies and quantifiable performance to evaluate how efficiently these economies use energy.”
The “metrics are distributed across three primary sectors responsible for energy consumption in an economically developed country: Buildings (blue), Industry (green), and Transportation (yellow). Also included is a section devoted to National Efforts (orange). National Effort profiles a nation’s commitment to energy efficiency.” Taken together, these metrics give an indication of overall energy efficiency in a country compared to other countries. Note: The color in parenthesis next to each sector indicates the sector’s contribution to the overall country scores graphically illustrated in the bottom left hand corner of Figure 9.
The analysis finds “the U.S., long considered an innovative and competitive world leader has allowed 12 of the 16 counties studied to surge ahead. Germany has the highest overall score. The top-scoring countries in each sector are:
- China in buildings,
- Germany in industry,
- Italy in transportation, and
- France, Italy, and the European Union in national efforts.
The report suggests the U.S. can improve by:
- National Effort – The U.S. Congress should pass a national energy saving target,
- Buildings – The U.S. Federal government should strengthen national model building codes,
- Industry – The federal government should support education and training in the manufacturing and industrial sectors, and
- Transportation – The U.S. Congress should prioritize energy efficiency in transportation spending. Source: American Council for an Energy-Efficient Economy
The U.S. “made some progress toward greater energy efficiency in recent years, particularly in areas such as building codes, appliance standards, voluntary partnerships between government and industry, and, recently, fuel economy standards for passenger vehicles and heavy-duty trucks.
In closing, DoE’s performance in transitioning America to an energy efficient and renewable energy economy is rather disappointing when compared to other developed and developing economies of the world. The million-dollar question is Why. The easy answer is America is a capitalistic society and renewable energy costs more than traditional energy and the high upfront costs to become energy efficient. A more plausible answer is fourfold – insufficient funds, politics at play, mismanagement, and lack of accountability.
Fixing the problem is simple but politically impossible. Take the DoE completely out of EERE business, appropriations and all. Transition the cost of the programs to bottom line incentives from the IRS, such as Section 1603 Treasury Cash Grant Program. Allow income tax deductions for the cost of becoming more energy efficient for new and existing residential, commercial and industrial facilities. If incentives become a point of contention, then take stop incentivizing the fossil fuel industry. With these measures in place, possibly capitalism can fix the problem.
 Department of Energy FY 2016 Congressional Budget Request; http://energy.gov/sites/prod/files/2015/02/f19/FY2016BudgetInBrief.pdf
 U.S. Department of Energy, Mission; http://energy.gov/mission
 U.S. Bureau of Land Management, Abandoned Mine Lands; http://www.abandonedmines.gov/wbd_um.html
 The Washington Post, Solyndra Scandal; https://www.washingtonpost.com/politics/specialreports/solyndra-scandal
 REN21. Renewables 2015 – Global Status Report; http://www.ren21.net/status-of-renewables/global-status-report
 Enerdata, Global Energy Statistical Yearbook 2015, Share of renewables in electricity production (including hydropower); https://yearbook.enerdata.net/#renewable-in-electricity-production-share-by-region.html
 U.S. Energy Information Administration, Electric Power Annual; http://www.eia.gov/electricity/monthly/pdf/epm.pdf
 Midwest Energy News, Renewable or not? How states count hydropower; http://www.midwestenergynews.com/2012/01/13/renewable-or-not-how-states-count-hydropowe/
 American Council for an Energy-Efficient Economy, The 2014 International Energy Efficiency Scorecard; http://aceee.org/sites/default/files/publications/researchreports/e1402.pdf
The opinions expressed in this article are solely those of the author Dr. Barry Stevens, an accomplished business developer and entrepreneur in technology-driven enterprises. He is the founder of TBD America Inc., a global technology business development group. In this role, he is responsible for leading the development of emerging and mature technology driven enterprises in the shale gas, natural gas, renewable energy and sustainability industries. To learn more about TBD America, please visit: http://tbdamericainc.com/
Who Am I? I’m the guy you hear me saying “Your Fired.” You rarely hear me say “Your Hired.” My favorite pastime is praising myself and flaunting my billions. Hey, I am not to blame because I am worth billions.
I love finding weaknesses in people, whether true or false, and exploiting those deficiencies so I can bully them around. All to my benefit. When challenged, I fight back with gibberish remarks that confuse my attackers or I just chicken out and hide behind some self-gratifying and nonsensical excuse.
Some say I am a sexist. How can that be? I cherish women! Even been married three times. It’s silly to think, as some say, I have a history of sexual assaults, I cherish women! How untrue it is that one of my ex-wife’s used “rape” to describe an incident between us. There was no rape. she only felt “violated” by the experience. See, I cherish women!
To show how much I cherish women, the other day I announced that I will no longer “call Megyn Kelly of Fox News a bimbo, because that would not be politically correct. Instead I will only call her a lightweight reporter!” Even though a few years back, I praised her for debate moderating. ‘Great Job,’ ‘I Could Never Beat You,’ I said, Hey, we are all allowed to change one’s mind. Especially when you are on the short side of the stick.
In business, winning is the only option. It’s untrue that I am the “King of Bankruptcies filings that destroyed many lives along the way!” I see myself as a modern day Robin Hood with a slight twist. I take from the banks and bondholders and give to the rich – myself that is. Isn’t that what we are supposed to do?
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I just don’t get it why the have nots make such a big deal over my ownership of casinos. If gambling is such a bad thing, why did Evangelical leader Jerry Falwell Jr. give me an endorsement? Jerry endorsed me knowing that smoking and drinking go hand-in-hand with gambling. This will make me a greater president. A president plays high-stakes everyday with the economy and the lives of its citizens. Did you know, Warren G. Harding once lost all the White House china gambling, on one hand of cards.
To show my modesty, I sold Trump Shuttle airline and my 282-foot megayacht, the Trump Princess. It’s foolish to think this had anything to do with the financial stress on the airlines or my personal finances.
I am a fighter, as you well know, I even battled the Justice Department on violations of the Fair Housing Act. They came after me only because my company is large and an easy target. In the end, I had the last laugh when it was ruled the Trump organization did not have to “accept persons on welfare as tenants unless they qualified as any other tenant.” I love everybody and always offer a warm welcome to welfare recipients, especially when they visit my casino. Sure some lose their money. Who am I to stop them from doing what they want to do. Their money is federal dollars anyway. What did they do to earn it anyway?
Speaking of fighting, unfortunately I did not fight in the Vietnam War because of a high draft number, 2-S student deferment and 1-Y medical deferment which was later converted to 4-F. I do love my country. That’s why I am running for the Presidency of our beloved United States. I will do a great job.
Do you know, I love American sports too? I purchased the New Jersey Generals for the inaugural season of the United States Football League. The USFL played during the spring and summer while the NFL was in their off-season. Some stupid people falsely claim it was my strategy that led to the demise of league after playing only three seasons. After all, it was Louisiana, businessman David Dixon’s idea to create the USFL, not me! The real reason for the leagues financial problems and franchise instability was as I once said “If God wanted football in the spring, he wouldn’t have created baseball.”
I am also a fan World Wrestling Entertainment. Do you recall my appearance at WrestleMania 23 in a match called “The Battle of the Billionaires”?
It’s true I am great, beloved and talented. Why else would I be invited to become a member of the Screen Actors Guild for which I receive a paltry pension around $110,000 every year. They even made an on-line documentary – What’s the Deal – about my trumpeted life in the 1980s and 1990s.
So what are my credentials to become the next President of the United States? I give you my solemn oath I will do whatever is in my power to show that all men are “not” created equal, that they are “not” endowed by their Creator with certain unalienable Rights ….. Not sure these are credential, but what does that matter. You will vote for me anyway.
The greatest trick in my campaign is convincing Americans I am sane, anchored in reality, a successful leader and there for the general welfare of the people. Now tell me I’m not Presidential material!
It’s Not Fracking to be Concerned with, It’s a Fugitive Hiding Along the Supply Chain that is A Clear-and- Present Danger!
In his January 2015 State of the Union address, President Obama emphasized two goals: the critical need to limit greenhouse gas pollution, and support for domestic natural gas and oil production, as well as renewable energy sources. His administration is seeking a 40 percent to 45 percent reduction in methane leaks and emissions of other volatile organic compounds from oil and gas wells and supporting infrastructure.
In support of these goals, the Environmental Protection Agency’s (EPA) announced they intend to regulate methane emissions from the oil and gas sector directly, rather than relying on voluntary programs or regulating associated pollutants. The proposal would be first-ever direct regulation on methane.
This presentation will look at methane emissions – fugitive, venting and flaring –from the oil and natural gas system; its impact, sources, and remediation in the context of the regulatory landscape and economic incentives.
Many view natural gas as a transitional fuel, allowing continued dependence on fossil fuels yet reducing greenhouse gas (GHG) emissions compared to oil or coal over coming decades.
Development of “unconventional” gas employing horizontal drilling and hydraulic fracturing, aka fracing” technologies dispersed in shale is part of this vision, as the potential resource may be large, and in many regions conventional reserves using well-known vertical drilling techniques are becoming depleted.
The Department of Energy predicts that by 2035 total domestic production will grow by 20%, with unconventional gas providing 75% of the total. The greatest growth is predicted for shale gas, increasing from 16% of total production in 2009 to an expected 45% in 2035.
Although natural gas is promoted as a bridge fuel over the coming few decades, in part because of its presumed benefit for global warming compared to other fossil fuels, very little is known about the GHG footprint of natural gas emissions from the oil and gas industry.
While methane is valuable as a fuel, it is also a greenhouse gas at least 21 times, possibly as much as 32 times, more potent than carbon dioxide over a 100-year period, with even greater relative impacts over shorter periods. In late 2010, the U.S. Environmental Protection Agency issued a report concluding that fugitive emissions from the natural gas system from wellhead to burner may be far greater than previously thought.
These fugitive emissions of methane are of particular concern. Methane is the major component of natural gas and a powerful greenhouse gas. As such, small leakages are important. Recent modeling indicates methane has an even greater global warming potential than previously believed, when the indirect effects of methane on atmospheric aerosols are considered.
Emissions are either fugitive, vented or flare related:
• Fugitive emissions are those that “leak” unintentionally from equipment such pumps, valves, flanges, or other equipment – air emissions from locations other than stacks, vents, chimneys, or other fixed locations designed for releasing emissions.
• Vented emissions are releases due to equipment design or operational procedures, such as from pneumatic device bleeds, blowdowns, incomplete combustion, or equipment venting.
• Flaring is a combustion process used in petroleum refineries, chemical plants, and natural gas processing plants as well as at oil or gas production sites having oil wells, gas wells, offshore oil and gas rigs and landfills. Natural gas emissions are due to incomplete combustion.
Despite all the talk about climate change, anthropogenic greenhouse gas emissions and methane’s potent gas global warming effect, it is surprising to discover, that as of today, the U.S. Environmental Protection agency exempts the Oil and Gas industry from direct controls of natural gas emission.
The global methane budget is poorly constrained, with multiple sources and sinks all having large uncertainties suggests fossil fuels may be a far larger source of atmospheric methane than generally considered.
The Natural Gas System
The natural gas system or value chain is a highly integrated system where gas is produced, processed, and delivered to consumers.
The complexity and extent of the system in the U.S. makes the problem of accurately identifying point sources of emissions and reducing those emissions more difficult. Additionally, each sector has different factors affecting where, when and how much are the CH4 emissions.
The cost of finding and repairing major emitter is one of the primary reasons; the EPA exempted the industry from controlling emissions under the Clean Air Act.
Field Production: In this initial stage of field production, wells are used to withdraw raw gas from underground formations. The oil and gas industry is an aggregate of 21 major production companies with another 6,000 or so, production companies of all sizes. There are about 2.7 million wells in the United States; of which 900,000 are active and about 1.8 million are abandoned. Of the 900,000 wells, 400,000 produce oil and approximately 500,000 natural gas dispersed within 33 states.
Gathering is the system of pipes that collects gas from the wells for downstream processing. While some of the needed processing can be accomplished at or near the wellhead, field processing, the complete processing of natural gas takes place at a processing plant, usually located in a natural gas producing region. The extracted natural gas is transported to these processing plants through a network of gathering pipelines, which are small-diameter, low pressure pipes. There exists about 200,000 miles of gathering pipe, typically 8-5/8” or less transporting natural gas at 500 psi. This is in conjunction with over 10,000 gathering stations, and 100,000 gathering compressors.
Processing. Natural gas used by consumers, is much different from the natural gas brought from underground up to the wellhead. Although the processing of natural gas is in many respects less complicated than the processing and refining of petroleum, it is equally as necessary before its use by end users. The natural gas used by consumers is composed almost entirely of methane. However, natural gas found at the wellhead, although still composed primarily of methane, is by no means as pure. Natural gas processing at any one of 580 processing plants in the U.S. consists of separating all of the various impurities, other hydrocarbons and fluids from the natural gas, to produce what is known as ‘pipeline grade natural gas that meets specified tariffs. Pipeline quality natural gas is 95-98 percent methane.
Transmission and Storage. Transmission, involves the delivery of natural gas from the wellhead and processing plant to city gate stations or industrial end users. Transmission occurs through a vast network of high-pressure pipelines. Natural gas storage falls within this sector. Natural gas is typically stored in depleted underground reservoirs, aquifers, and salt caverns.
The transmission sector includes about 320,000 miles of large diameter interstate and intrastate pipelines, between 24 and 48 inches in diameter. The pipes transport pressurized natural gas at 1,000 psi from any one of 1,800 compressor stations. The transportation system also includes about 400 underground storage facilities consisting of depleted underground reservoirs, aquifers, and salt caverns.
Within this network, there are more than 11,000 delivery points, 5,000 receipt points, and 1,400 interconnection points that provide for the transfer of natural gas throughout the United States. Twenty-nine hubs or market centers provide additional interconnections.
Distribution focuses on the delivery of natural gas from the major pipelines to the end users (e.g., residential, commercial and industrial). Distribution pipelines take the high-pressure gas from the transmission system at “city gate” stations, reduce the pressure and distribute the gas through primarily underground mains and service lines to individual end users.
There was over 2 million miles of distribution mains in 2011. The distribution sector is operated by 1,200 companies that serve 66 million residential, 5.3 million commercial, and 191,000 industrial customers as well as 1,700 natural gas-fired electricity power plants, throughout the United States.
The natural gas is periodically compressed to ensure pipeline flow, although local compressor stations are typically smaller than those used for interstate transportation. Because of the smaller volumes of natural gas to be moved, as well as the small-diameter pipe that is used, the pressure required to move natural gas through the distribution network is much lower than that found in the transmission pipelines.
While natural gas traveling through interstate pipelines may be compressed to as much as 1,500 pounds per square inch (psi), natural gas traveling through the distribution network requires as little as 3 psi of pressurization and is as low as ¼ psi at the customer’s meter.
Overall, it is no wonder that such a massive distributed system of as pipes, valves, pumps, compressors, connectors, and flanges is prone to leaks.
There are several tangible and intangible drivers forcing the reduction methane emissions. From a social perspective, there is climate change and public awareness that possibly the scientists were right and the warming effect of anthropogenic greenhouse gas emissions of CO2 and CH4 are having a negative impact on the world’s environment, right before our eyes.
Reducing methane emissions, as we will see, is a powerful way to take action on climate change; and putting the wasted methane to use can support local economies with a source of clean energy that generates revenue, spurs investment, improves safety, and leads to cleaner air. That is why in his Climate Action Plan of 2014, President Obama directed the Administration to develop a comprehensive, interagency strategy to cut methane emissions.
Categorizing the US Greenhouse Gas Inventory by type of Gas.
The critical question is: Given the current extent of U.S. natural gas production—and the fact that production is projected to expand by more than 50 percent in the coming decades—what is the baseline natural gas fugitive emissions and are we doing everything we can to ensure that emissions are as low as is technologically and economically feasible?
This pie chart, U.S. Greenhouse Gas Inventory, illustrates the relative contribution of direct greenhouse gases to total U.S. emissions in 2011, that is the US greenhouse gas inventory. The primary greenhouse gases in the US inventory are CO2 and CH4 contributing approximately 82% percent and 10% to total greenhouse gas emissions, respectively. U.S. EPA Draft Inventory of U.S. Greenhouse Gas Emissions and Sinks: 1990 to 2011.
Defining Atmospheric Methane by Industry
This pie chart, U.S. Methane Emissions by Source, provides a summary of the major contributors of CH4 emissions. The primary sources of atmospheric methane was natural gas systems, enteric fermentation associated with domestic livestock digestion of feedstock (occurring in the intestines), and decomposition of wastes in landfills, see pie chart on the right.
Natural gas systems are the largest anthropogenic source of CH4 emissions in the United States, accounting for approximately one-quarter of total CH4 emissions in 2011.
Enteric fermentation, the second largest anthropogenic source of CH4 emissions in the United States in 2011, enteric fermentation contributed about 23 percent to the total CH4 emissions, an increase of 3.5 percent since 1990. This increase in emissions from 1990 to 2011 in enteric generally follows the increasing trends in cattle populations.
Landfills, the third largest anthropogenic source of CH4 emissions in the United States, accounted for 17.5 percent of total CH4 emissions in 2011.
In 2011, CH4 emissions from coal mining were 23 percent of total CH4 emissions. This amount represents an overall decline of 24.8 percent from 1990 results from the mining of less gassy coal from underground mines and the increased use of CH4 collected from degasification systems.
Manure management methane emissions were about 9% of the total CH4 emissions. Manure management refers to the capture, storage, treatment, and utilization of animal manures.
Petroleum systems and wastewater management methane emission contributed about 5 and 3 percent, respectively, to the inventory of CH4 emissions.
Methane emissions from wastewater management are produced when municipal and industrial wastewater and their residual solid by-product (sludge) are handled under or subject to anaerobic conditions.
Other sources of methane – rice cultivation, abandoned underground coal mines, iron and steel production, field burning of agricultural resides and silicon carbide production – also play a role to atmospheric methane emissions.
Natural gas system’s contribution of methane to US’s total greenhouse inventory is estimated to be about 2.4 percent; that is, total CH4 emissions of 10% multiplied by 24%, its contribution to the methane component of the greenhouse gas inventory.
EPA Reporting Rules for the O&G Industry
On December 30, 2010, the EPA is promulgated a regulation to require monitoring and reporting of greenhouse gas emissions from petroleum and natural gas systems. The GHG reporting rules are contained in Title 40 CFR part 98 – Mandatory Greenhouse Gas Reporting.
The action does not require control of methane emissions.
GHG reporting is for actual emissions, unlike air permits, which are for Potential To Emit (PTE) emissions. The rule requires a facility that has actual emissions of 25,000 metric tons or more of CO2e per year to submit an annual report of GHG in electronic format to the EPA.
Methane Emissions: Natural Gas System
Identifying the sectors within the natural gas system contributing to methane emissions;
This figure from the U.S. Environmental Protection Agency shows the leakage estimates by major industry segments along the supply chain – from preproduction activities of drilling and hydraulic fracturing, followed by production, processing, transmission, distribution and end use at homes, buildings, factories and modes of transportation,
The EPA estimates the leakage rate, the amount of gas lost per unit of production, throughout the natural gas systems at about 1.5%. Of the 1.5% losses, drilling and fracturing contributed 13% to the total emissions – production another 27% – processing 13%, with remaining 47% coming from the transportation and distribution sectors.
Field Production activities account for 31 percent of CH4 emissions from natural gas systems. Emissions at natural gas well pads come from leaks, pumps, unloading liquids from wells, pneumatic devices, compressors, condensate tanks and dehydrators. Leaks can also come from leaks, pneumatic devices and compressors at gathering stations, which increase the pressure of the gas in the gathering pipeline.
Methane emissions at Oil well pads methane are lower than gas wells and again come from, leaks, pneumatic devices, and storage tanks.
However, flaring of associated gas at oil well pads is an additional source of CH4 emissions and account for the majority of the non-combustion CO2 emissions.
Processing plants account for 15 percent of CH4 emissions from natural gas systems. Fugitive CH4 emissions from compressor venting, including leaky compressor seals, are the primary emission source from this stage. The majority of non-combustion CO2 emissions come from acid gas removal units, which are designed to remove CO2 from natural gas.
CH4 emissions from the transmission and storage sector account for approximately 44 percent of emissions from natural gas systems, while CO2 emissions from transmission and storage account for less than 1 percent of the non-combustion CO2 emissions from natural gas systems. Compressor station facilities, which contain large reciprocating and turbine compressors, are used to move the gas throughout the United States transmission system. Fugitive CH4 emissions from these compressor stations and from metering and regulating stations account for the majority of the emissions from this stage. Pneumatic devices and engine un-combusted exhaust are also sources of CH4 emissions from transmission facilities.
Natural gas is also injected and stored in underground formations, or liquefied and stored in above ground tanks, during periods of low demand (e.g., summer), and withdrawn, processed, and distributed during periods of high demand (e.g., winter). Compressors and dehydrators are the primary contributors to emissions from these storage facilities.
Distribution system emissions, which account for approximately 20 percent of CH4 emissions from natural gas systems and less than 1 percent of non-combustion CO2 emissions, result mainly from fugitive emissions from city gate stations and pipelines, where the gas is measured and decompressed before it is put into final sales lines to the consumers.
An increased use of plastic piping, which has lower emissions than other pipe materials, has reduced emissions from this stage. Distribution system CH4 emissions in 2011 were 16 percent lower than 1990 levels.
While not shown, customer meter-sets were found to contribute approximately 5 percent, to annual emissions from equipment leaks. Emission form outdoor residential customer meter sets account for 96 percent of the annual fugitive emissions from customer meters, whereas commercial and industrial meter sets account of only 4 percent.
Point Source of Emissions
The Gas Research Institute (GRI) and the U.S. Environmental sponsored a program to quantify methane emissions form the gas industry, starting at the wellhead and ending immediately downstream of the customer’s meter. The major contributors to emissions from equipment leaks are components associated with compressors, which have unique design and operating characteristics and are subject to vibrational wear. Components represent mechanical joints, seals, and rotating surfaces, with in time tend to wear and develop leaks. The largest emission point source is the compressor blowdown open-ended lines BD OEL, which allows the compressor to be depressurized for maintenance or when idle.
This bar chart aggregates emissions by component from data presented in the preceding table. By doing this, it is easier to identify the major point sources of emissions. It is rather obvious that compressor blowdown operations far exceed all other component emissions.
CH4 Fugitive Emission Reduction Opportunities
A groundbreaking analysis commissioned Environmental Defense Fund and conducted by ICF International (ICF) shows that the U.S. oil and gas industry can significantly and cost-effectively reduce emissions of methane – using currently available technologies and operating practices.
The report concluded:
• There are real cost-effective solutions available today that can put natural gas on a safer path for communities and for the climate.
• Methane emissions from U.S. oil and gas are projected to increase 4.5% by 2018 as emissions from industry growth – particularly in oil production – outpace reductions from regulations already on the books.
• Industry could cut methane emissions by 40% below projected 2018 levels at an average annual cost of less than one cent on average per thousand cubic feet of produced natural gas by adopting available emissions-control technologies and operating practices. This would require a capital investment of $2.2 billion, which Oil & Gas Journal data shows to be less than 1% of annual industry capital expenditure.
• If the full economic value of recovered natural gas is taken into account, the 40% reduction is achievable while saving the U.S. economy and consumers over $100M per year.
• The most cost-effective methane reduction opportunities would create over $164M net savings for operators.
• Almost 90% of projected 2018 emissions will come from oil production and existing natural gas infrastructure.
• A number of solutions, particularly in the upstream of the oil and gas value chain, will have environmental co-benefits at no extra cost, by reducing emissions that can harm human health, like volatile organic compounds and hazardous air pollutants.
Methane Mitigation Technologies
Several technologies are currently available that can economically reduce fugitive and vented methane emissions. The nine most promising technologies include:
• Implementing Leak Detection and Repair Programs
• Rerouting “Blowdown” Open-Ended Lines
• Replacing Wet Seals with Dry Seals in Centrifugal Compressors
• Installing Vapor Recovery Units on Storage Tank
• Installing Plunger Lift Systems in Gas Wells
• Wet Seal Degassing Recovery System for Centrifugal Compressors
• Converting High‐Bleed Pneumatic Devices to Low‐Bleed
• Reciprocating Compressor Rod Packing Replacement.
• Convert Natural Gas‐Driven Chemical Pumps (Kimray Pumps)
EPA STAR Program
EPA’s Natural Gas STAR Program has been most successful program so far in mitigation emissions in the oil and gas natural gas system. STAR is a flexible, voluntary partnership that encourages oil and natural gas companies—both domestically and abroad—to adopt cost-effective technologies and practices that improve operational efficiency and reduce emissions of methane while benefiting the environment, industry and the government.
Currently, Gas STAR includes 109 domestic oil and gas partner companies from all sectors, representing about 50% of the U.S. natural gas industry and 18 international Partners.
Between 1993 when the program begin through 2012, the Natural Gas STAR Program reported over 1 trillion cubic feet of methane emissions reductions since the program began in 1993 by implementing approximately 150 cost-effective technologies and practices.
This Figure shows Domestic Natural Gas STAR Methane Emissions Reductions from its start in 1993 to 2012. Each year since 1993, Natural Gas STAR partners have reported on the emission reduction activities undertaken to create a permanent record of their voluntary activities.
In 2012, Natural Gas STAR and Natural Gas STAR U.S. partners reported over 66 billion cubic feet (Bcf) in methane emission reductions by implementing nearly 50 technologies.
These methane emissions reductions had cross-cutting benefits on domestic energy supply, industrial efficiency, revenue generation, and greenhouse gas emissions reductions.
Alone, the 2012 emission reductions are equivalent to:
• The additional revenue of more than $264 million in natural gas sales (assumes an average natural gas price of $4.00 per thousand cubic feet).
• The avoidance of 26.7 million tonnes CO2 equivalent.
• The carbon sequestered annually by 5.7 million acres of pine or fir forests.
Adding to the success reported under the domestic Program, progress was also made in reducing global methane emissions through Natural Gas STAR International. International partners reported 7.6 Bcf in methane emissions reductions for a total of 98 Bcf since the inception of Natural Gas STAR International Program in 2006.
This figure shows the 2012 methane emission reductions breakdown by each sector – Production, which includes Gathering and Processing, and Transmission, and Distribution.
As in past years, the oil and gas production sector reported the largest reductions, accounting for 82 percent or 54 Bcf of the total reductions. The Transmission sector followed at 15% for 10 Bcf of the total methane emissions reductions.
Methane emissions reductions in 2012 occurred though the implementation of nearly 50 technologies and practices
Examples of technologies and practices used to reduce methane emissions included:
• Perform reduced emissions completions
• Use Directed Inspection and Maintenance (DI&M)
• Install flash tank separators on glycol dehydrators
• Use pipeline pumpdown techniques to lower pressure
• Implement a third-party damage prevention programs
These proven technologies and practices reduce methane emissions that would normally escape to the air from wells, storage tanks, and other equipment. These reductions result in significant environmental benefit by reducing methane, a potent greenhouse gas (GHGs), as well as reducing volatile organic compound (VOC) emissions, a precursor to ground-level ozone pollution.
In summary, EPA could reduce the sector’s methane pollution in half in a just few years by issuing nationwide methane standards that require common sense, low-cost pollution controls for the sector’s top emitting sources:
The methane abatement potentials are conservative estimates based on government inventories. They don’t account for the research indicating that actual emissions could be twice the inventory estimates, or higher. The problem and the upsides of controlling it—are likely much greater.
Regular leak detection and repair programs can reduce methane pollution by an estimated 1,700,000 to 1,800,000 metric tons per annum (MMTA).
Cleaning up older equipment—compressors and gas-driven pneumatic equipment—with proven technologies and practices can reduce methane pollution by an estimated 1,200,000 to 1,350,000 metric tons per annum.
The cost of the recommended standards would be low—less than one percent of the industry’s sales revenue.
The impacts of various drivers on reducing methane emissions from voluntary measures by oil and gas production are already positive. For example, regulatory and social mandate to reduce emissions are driving oil and gas operators to modify traditional operating practices by reducing natural gas venting during oil and gas production.
Technology developments are allowing operators to implement changes, capture, and sell more natural gas.
Greenhouse Gas Emissions and Natural Gas: The EPA and the Forgotten Source – The Oil and Gas Industry!
Please join me on Thursday, June 4, 2015 at 1:00 EDT, for my live webinar “Greenhouse Gas Emissions and Natural Gas: The EPA and the Forgotten Source – The Oil and Gas Industry!”
The webinar will look at on reducing methane emissions – fugitive, venting and flaring – from the natural gas system not only to be good environmental stewards but also to reap substantial profits.
In his January 2015 State of the Union address, President Obama emphasized two goals: the critical need to limit greenhouse gas pollution, and support for domestic natural gas and oil production, as well as renewable energy sources. His administration is seeking a 40 percent to 45 percent reduction in methane leaks and emissions of other volatile organic compounds from oil and gas wells and supporting infrastructure.
In support of both goals, the Environmental Protection Agency’s (EPA) announced they intend to regulate methane emissions from the oil and gas sector directly, rather than relying on voluntary programs or regulating associated pollutants. The proposal would be first-ever direct regulation on methane as part of an Obama administration strategy expected to curb methane emissions by as much as 45 percent by 2025.
My intent is to make this Webinar as informative as possible and make you aware that:
- there is a problem with methane emissions from oil and gas production, gathering and processing, transmission, and distribution;
- the problem is solvable and beneficial to stakeholders,
- and that government can work with the industry to achieve mutually beneficial results without excessive rules and regulations,
- while balancing the seemingly contradictory needs between people, planet and profits.
We will lay this foundation by:
- Demystifying the natural gas system
- Understanding the drivers to reduce U.S. Methane emissions
- Unraveling the current state of the U.S. Greenhouse gas inventory
- Reviewing the regulatory side of the equation
- Identifying several barriers inhibiting quantification of fugitive emissions
- Developing estimates of methane leakage from the natural gas system
- Highlighting the CH4 fugitive emission reduction opportunities
- Comparing reduction opportunities against marginal abatement costs
- Outlining several methane mitigation technologies
- Explaining the leak detection and repair (LDAR) process and mechanics
- Conducting case studies and economic analysis of several primary improvement practices and technologies
- Suggesting some enabling trends that are not advancements in technology and practices,
- and finishing with a summary and some closing comments.