The Shock Of Energy Transition 3b4h2o

THE SHOCK OF ENERGY TRANSITION

Fouad Saad

Copyright © 2016 by Fouad Saad.

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978-1-4828-6495-3

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CONTENTS

Introduction

1 – Defining Energy

1.1 Energy Efficiency:

1.2 Crude Oil:

1.2.1 Conventional Oil Reserves:

1.2.2 Heavy and Extra Heavy Oil:

1.2.3 Unconventional Oil Reserves:

1.2.4 Oil Sands Bitumen:

1.2.5 Shale Oil:

1.3 Coal:

1.3.1 Peat:

1.3.2 The Nature of Peatlands and Peat:

1.3.3 Uses of Peat:

1.3.4 Peat from a Climate Impact Point of View:

1.3.5 Lignite:

1.3.6 Uses of Lignite:

1.3.7 Formation of Lignite:

1.3.8 Sub-Bituminous Coal:

1.3.9 Properties of Sub-Bituminous coal:

1.3.10 Bituminous Coal:

1.3.11 Uses of Bituminous Coal:

1.3.12 Steam Coal:

1.3.13 Anthracite (Coal):

1.3.14 Anthracite Usage Presently:

1.3.15 Graphite (Coal):

1.3.16 Carbon Capture and Storage (CCS):

1.3.17 Limitations of CCS for Power Stations:

1.4.3 Shale Gas:

1.4.4 Hydrates:

1.5.3 Fusion Power in Nuclear Energy:

1.6 Hydro-Electric Power:

1.6.1 Streams and Rivers:

1.6.2 Marine Currents:

1.6.3 Waves:

1.6.4 Tides:

1.6.5 Osmotic Energy:

1.7 Biomass Energy:

1.8 Wind Energy:

1.9 Solar Power:

1.9.1 Solar Thermic Power (STP):

1.9.2 Photovoltaic Solar Power (PV):

1.9.3 Concentrated Thermodynamic Solar Power (CTSP):

1.10 Geothermal Energy:

1.10.1 Geothermal Economics:

2 – Global Energy Mix: Present And Future Projections (2035)

2.1 The Somersault Factor of Energy Cost:

2.2 Energetic Feedstock Substitution in Major Economic Poles:

A. USA:

a. Biomass Power in the USA:

b. Hydroelectric Power in the USA:

c. Wind Power in the USA:

d. Solar Power in the USA:

e. Geothermal Power in the USA:

B. CHINA:

a. Wind Power in China:

b. Solar Power in China:

c. Biomass and Fuel Power in China:

d. Geothermal Power in China:

C. UNITED KINGDOM:

a. Wind Power in The United Kingdom:

b. Ocean Power in The United Kingdom:

c. Biofuels Power in The United Kingdom:

d. Solar Power in The United Kingdom:

e. Hydroelectric Power in The United Kingdom:

f. Geothermal Power in The United Kingdom:

g. Microgeneration And Community Energy Systems:

D. :

a. Wind Power in :

b. Biomass Power in :

c. Solar Power in :

d. Hydroelectric Power in :

e. Geothermal Power in :

E. :

a. Biofuel Power in :

b. Geothermal Power in :

c. Hydroelectric Power in :

d Solar Power in :

e. Renewable Energies in The Overseas Territories of :

F. JAPAN:

a. Solar Power in Japan:

b. Wind Power in Japan:

c. Hydroelectric Power in Japan:

d. Geothermal Power in Japan:

e. Biofuels Power in Japan:

f. Ocean Power in Japan:

G. BRAZIL:

a. Hydroelectric Power in Brazil:

i. The Itaipu Dam:

b. Solar Power in Brazil:

c. Wind Power in Brazil:

d. Ethanol Fuel in Brazil:

i. The Ethanol Crisis in Brazil in 2010:

e. Hydrogen Power in Brazil:

f. Biomass Energy in Brazil:

3 – Tomorrow’s Car Today

i. The Electric Vehicle:

1. Plug-in electric vehicle:

2. Battery Electric Vehicle (BEV):

a. Who Tried to Abort The Electric Car?

1. Topics Addressed

2. The Suspects:

a. U.S. consumers:

b. Batteries:

c. Oil Companies:

d. Original Equipment Manufacturers (OEM):

e. U.S. Government:

f. California Air Resources Board (CARB):

g. Hydrogen Fuel Cell:

h. General Motor’s Alibi

b. The Electric Car is a Computer:

c. Benefits and Drawbacks of the Electric Car:

ii. The Compressed Natural Gas Vehicle:

a. Canada:

b. Mexico:

1. Europe:

a. :

b. Ireland:

c. Italy:

2. China:

iii. The Flexible Fuel Vehicle:

a. FFV’s around the World:

1. Brazil:

iv. The Hydrogen Vehicle:

a. Skepticism over The Hydrogen Vehicle:

a. The TELP Factors:

1. Technology:

a. Crude Oil:

b. Natural Gas:

2. Economy:

a. USA:

b. China:

c. :

d. United Kingdom:

e. :

3. Legislation:

4. Politics:

a. Crude Oil:

b. Natural Gas:

i. Natural Gas Pipelines Dominated by Russia:

1. Nord Stream:

2. South Stream:

3. Altai:

ii. Natural Gas Pipelines Dominated by Western Powers:

1. TAPI (Trans-Afghanistan Pipeline):

2. Trans-Caspian Pipeline:

3. White Stream Pipeline:

iii. Rivaling Natural Gas Pipelines:

1. The Iran-Iraq-Syria Gas Pipeline:

2. The Qatar Turkey Gas Pipeline:

iv. Extent of European Dependence on Russian Natural Gas:

4 – Prosperity Through Energy in The Middle East And Africa (MEA)

i. Energy in MEA Countries:

ii. The Incongruence of Feedstock to Power in The MEA:

iii. The Obvious Alternative Energy Sources in The MEA:

iv. Renewable versus Nuclear Power in The MEA:

a. The Case of The UAE:

b. The inspiring case of El Hierro Island:

5 – Emancipation Through Education in The MEA

i. The Contrast Between The Energy Protection Conservation Act (EPCA) And OPEC’s Founding Charter:

ii. The Cure to The Dutch Disease:

a. Rebuilding Education:

1. Basic Manufacturing in Petrochemicals

a. Steam Cracking:

b. Catalytic Cracking:

4. Gas To Liquids Technology (GTL):

5. Polymer Science And Engineering:

6. Conversion Processes in Plastic Industries:

a. Extrusion Process:

b. Injection Molding:

c. Blow Molding:

d. Thermo-Plastics:

e. Thermosetting Plastics:

7. Software in Integrated Supply Chain Management:

b. Targeting Investments:

1. Micro-Generation in The Renewable Sector:

a. Micro-Hydro-Electric Power:

2. Investments in Infrastructure:

a. Road, Sewage, Power, Municipal Maintenance, Health, Education:

b. Revamping Existing Crude Oil Refineries & Building New Refineries:

c. Natural Gas Exploitation:

d. The Building And Expansions of Petrochemical Plants:

e. Dedicated Industrial Areas:

c. Fighting Corruption:

I wish to dedicate this book to my lovely niece Rita without whom none of my books would have been possible, and to my brother Jean who makes everything worth achieving within reach.

Fouad A.Saad, December 24th, 2015

INTRODUCTION

Energy in our lives:

Today citizens in advanced countries live longer and in better conditions than ever before thanks in part to the cumulative results of scientific research that has been honed to extract energy from the world around us, and use it wisely.

What is energy and where can it be found and at what cost? How much of it is renewable? What is the impact of energy usage on the air we breathe and what choices do we have to keep improving our living standards without jeopardizing our survival?

Over the next few pages we shall attempt to answer these questions and shed light on the changing global energetic landscape and the opportunities for economic renewal this represents for advanced countries and the near lethal threats it spells for countries whose economy is almost entirely dependent on selling fossil fuels.

We must realize that the implications of a paradigm shift in energy has geopolitical implications that might see a number of countries regress into abject poverty while others survive and prosper, the factor of salvation being whether or not their economy is diversified and knowledge based.

The Middle East and Africa is amongst the richest on earth a region in energetic resources –oil, gas, minerals, forests, water and others, including renewable

primary energy sources- yet few if any countries in it have succeeded –or even tried- to address the issue of long term clean and affordable energy. While demography gallops, some states in the Middle East and Africa that have remained almost entirely dependent on the sales revenues of crude oil and gas, have their means to maintain their societies well educated and prepared to the workforce, eroded. Where impoverished masses multiply self-destructive ideologies thrive and can be exploited to serve the schemes of powerful countries with less than benevolent intentions.

The world is at the dawn of a new era in energy that will rely considerably less on crude oil and coal, and significantly more on natural gas and renewable sources of energy. Coal remained the primary source of energy from the inception of the industrial revolution in 1750 till the commercialization of the car with an internal combustion engine (ICE), running on a petroleum derivative (gasoline), at the beginning of the twentieth century. The domination of coal as a source of energy lasted around 170 years, before petroleum started to gain ground. From the time cars were first mass produced in 1920 till the adoption of hydraulic fracturing in 2008, crude oil constituted roughly 35% to 40% of the global energetic feedstock, and nearly half to two thirds of the crude oil barrel has been used to fuel transportation.

Today, due to leaps in technology and environmental legislation, petroleum is about to cede its preponderant role as a source of energy which it has held for nearly a century to natural gas, hydraulic power, photovoltaic cell and other renewable sources of energy. To be sure fossil fuels will remain useful and needed because their derivatives serve to make indispensable products to our modern life, but the selling price of crude oil per metric ton, could very well keep going down to be comparable to the selling price of coal. This single factor is likely to cause a social and economic chasm in a good number of countries whose treasuries are mostly filled by the sales revenues of one product only: crude oil.

My ultimate goal in this book is to blaze trails for prosperity opportunities for

our societies in a sustainable and responsible manner that brings together generations of educated youth with entrepreneurial initiatives to a burgeoning job market. Education is a social elevator and a guarantor of wellbeing in a world of technological upheavals with potentially devastating effects on several countries and industries, but nowhere more so than in an already beleaguered Middle East.

1

Defining Energy

Primary energy is an energy form found in nature that has not been subjected to any conversion or transformation process. It is energy contained in raw fuels, and other forms of energy received as input to a system. Primary energy can be non-renewable or renewable. The supply and use of energy have powerful economic, social and environmental impacts.

It is possible to distinguish ten forms of energy (including Energy Efficiency as a source of energy by itself, and which we will include first because we consider it the most within reach of implementation by ordinary citizens):

1.1 Energy Efficiency:

A sense of initiative and civility combined with intelligence and ingenuity constitutes in itself a valuable source of energy through the responsible design of buildings and sensible use of utilities. Energy efficiency is achieved when we are mindful and aware of plentiful and gratis renewable sources naturally bestowed upon us: sunshine and wind, to name only those renewables from which we can benefit almost effortlessly, through the informed placement of transparent skylights and windows. A vast panoply of plastic products optimally strong yet lighter than steel or even aluminum, pleasanter to the eye, optionally transparent, cheaper to transport and safer to handle are now available for architects to market to their clients. Evolving technology has placed more efficient compact fluorescent bulbs (LED, light emitting diodes) on the shelves for informed consumers to choose over other options. Such light bulbs have a longevity of service ten times longer that of oval shaped predecessors, and provide a more intense light and consume less energy than incandescent older bulbs. Benefits derived from Energy Efficiency are financial as well as environmental as they reduce the harmful imprint of social activities on the air we breathe. The International Energy Agency predicts that Energy Efficiency, which is purely an attitude in approaching human activity could save as much as one third what we pay globally in bills for electricity and transportation. Energy Efficiency couple with the continued increase in the use of renewables is already contributing to the increase in disposable income and amelioration of lifestyles of populations.

It is a sign of civility and intellectual nobility to continuously make a thriftier and more intelligent use of our resources to power our lives. Energy Efficiency means increasing our awareness and empowerment to use more constructively the resources within reach and improving in many cases the balance of payment of all fossil fuel importing countries.

1.2 Crude Oil:

Crude oil is formed when large quantities of dead organisms, usually zooplankton (plankton are organisms drifting in oceans, seas, and bodies of fresh water) and algae, are buried underneath sedimentary rock and subjected to intense heat and pressure in an anaerobic environment, shielded from oxygen. The process to transform dead organisms into oil takes literally hundreds of millions of years.

Oil plays an important role in the global energy balance, ing for around 35% of energy consumption in 2015. This proportion has changed very little in the last quarter century (the figure was 37% in 1990), despite the fact that the total amount of energy consumed worldwide has increased by more than 50% over the same period. This trend has been driven primarily in the last decade by emerging countries.

The concept of “Peak Oil” has been proven wrong by technology which made it possible to extract energy (oil and, separately natural gas) from rocks (including shale) and other unconventional sources. According to World Energy Council (WEC) current global oil reserves are at 1,650 billion barrels or 1.65 trillion or giga represented by G barrels (giga is 10 ) Gb (BP Statistical Review). Despite high levels of daily consumption that have been growing by 32 % since 1991 from 66 Mbd (million barrels per day) in 1991 to 92 Mbd in 2015 - reserves have increased by over 60% over the same period, representing a gain of 620 Gb. Given cumulative consumption of the same order (595 Gb), this means that new discoveries and reappraisals have totaled 1,210 Gb since 1991, which is a large amount by any measure. This explains why the reserves-to-production ratio has increased from 43 to 54 years.

Every region of the world except Europe saw its oil reserves increase between

1991 and 2015. Those of South America (19.7% of the total), Africa (8%) and the CIS (7.7%) rose most significantly, the first having quadrupled (as a result of the decision of Venezuela to report its huge extra heavy oil resources), whilst the other two doubled over the period. The trend for other regions varied from +77% for North America (13.2% of total as a result of the Canada effect) to 20% for the Middle East (48.1%) and 12% for Asia (2.5%). Europe (0.9%) was the only region to see a decline of 21%. The increasing importance of South America, whose contribution to total reserves has risen from 7% to nearly 20%, has reduced the influence of the Middle East on the global oil stage. It is true that this region still contains nearly half of the world’s oil reserves, but this represents a significant reduction from the 1990’s, when the figure was 64%.

On the other hand, one parameter of particular market sensitivity that has changed very little is the potentially dominant role played by OPEC, which still s for more than 70% of the world’s total crude oil reserves. Let us be mindful that some OPEC are at odds with each other, which tends to turn what influence they could have had against their sought objectives.

Let us define the various kinds of crude oil now available for exploitation:

1.2.1 Conventional Oil Reserves:

This oil and gas may contain different condensate and components such as sulfur and acids. This migration also explains why each reservoir is different and may require different processes for exploration and production. The recovery rate may also be very different from one reservoir to another even though they should be conventional.

1.2.2 Heavy and Extra Heavy Oil:

As defined by the U.S. Geological Survey (USGS), heavy oil is a type of crude oil characterized by an asphaltic, dense, viscous nature (similar to molasses), and its asphaltene (very large molecules incorporating roughly 90 percent of the sulfur and metals in the oil) content. It also contains impurities such as waxes and carbon residue that must be removed before being refined. Although variously defined, the upper limit for heavy oil is 22° API gravity with a viscosity of 100 (centipoise). The American Petroleum Institute’s “API gravity” is a standard to express the specific weight of oils, computed as (141.4/sp g) - 131.4, where sp is the specific gravity of the oil at 60 degrees Fahrenheit. The lower the specific gravity value, the higher the API gravity will be.

1.2.3 Unconventional Oil Reserves:

When the extraction of crude oil from a mineral or other resource requires more than injecting natural gas, or carbon dioxide or water; when the successful extraction requires hydraulic fracturing of rock or sand then the hydrocarbon deposits can be referred to as unconventional.

We can consider unconventional crude oil to be petroleum produced or extracted using techniques other than the conventional (oil well) method. Oil industries and governments across the globe are incentivized to invest in technologies to tap into unconventional oil sources when the price of the crude oil barrel hovers above 75 USD per barrel. Once the actual technology is mastered, economies of scale in extraction investments take place and bring the break-even point down; and the price of the crude barrel is brought down when availability of crude oil becomes galore. However, the categories “conventional” and “unconventional” do not remain fixed, and over time, as economic and technological conditions evolve, resources hitherto considered unconventional can migrate into the conventional category.

1.2.4 Oil Sands Bitumen:

Oil sands, tar sands or, more technically, bituminous sands, are a type of unconventional petroleum deposit.

Oil sands can be loose sands or consolidated only in part sandstone comprising a naturally happening blend of silt, earthen, and liquid, saturated with a condensed and extremely glutinous form of oil technically referred to as bitumen (or colloquially asphalt because of its akin form, olfactory properties, and aesthetics). Natural bituminous resources are found all over the world, albeit not always in commercial quantities. They are encountered galore in Canada. Plentiful resources are also in Kazakhstan and Russia. Presently, it is estimated from computer generated imaging and samples of analyzed soil that oil resources in the world exceed 2 trillion barrels (320 billion cubic meters).

Nonconventional reserves in hydrocarbon resources have been accessible ever since 2008 thanks to the successful evolution of hydraulic fracturing and slanted drilling. Higher prices of crude oil have encouraged a literal conquering rush of shale deposits throughout the USA. The crude bituminous hydrocarbon resources in Canada (Alberta mostly) would have been commercially of little significance due to its high viscosity had it not been for the leap in technological knowhow pioneered by George Mitchell through hydraulic fracturing (coined as “fracking”). Heat is required to soften the rheological properties and favor steady flow.

The World Energy Council (WEC) defines natural bitumen as “oil having a viscosity greater than 10,000 centipoise under reservoir conditions and an API gravity of less than 10° API”. The Orinoco Belt in Venezuela belong to the category of heavy or extra-heavy oil due to their lower viscosity. Natural bitumen and extra-heavy oil differ in the degree by which they have been

degraded from the original conventional oils by bacteria. According to the WEC, extra-heavy oil has “a gravity of less than 10° API and a reservoir viscosity of no more than 10,000 centipoise”.

The Government of Alberta states that harmful emissions from oil sands are twelve per cent higher than conventional oil deposits.

1.2.5 Shale Oil:

Shale oil is an unconventional liquid oil produced from oil shale rock fragments by pyrolysis (pyrolysis is a thermochemical decomposition of organic material at elevated temperatures in the absence of oxygen), hydrogenation (the addition of pairs of hydrogen atoms), or thermal dissolution. These processes convert the organic matter within the rock (kerogen) into synthetic oil and gas. The resulting oil can be used immediately as a fuel or upgraded to meet refinery feedstock specifications by adding hydrogen and removing impurities such as sulfur and nitrogen. The refined products can be used for the same purposes as those derived from crude oil.

Oil shale, also known as kerogen shale, is an organic-rich fine-grained sedimentary rock containing kerogen (a solid mixture of organic chemical compounds) from which liquid hydrocarbons called shale oil can be produced.

Shale oil is a substitute for conventional crude oil; however, extracting shale oil from rock sediments of oil shale is more costly than the production of conventional crude oil both financially and in of its environmental impact. Deposits of oil shale rocks occur around the world, including major deposits in the United States. Estimates of global deposits range from 4.8 to 5 trillion barrels (760×10 to 790×10 m³) of crude oil equivalent in place.

1.3 Coal:

Coal is a combustible, sedimentary, organic rock, which is composed mainly of carbon, hydrogen and oxygen. It is formed from vegetation, which has been consolidated between other rock strata and altered by the combined effects of pressure and heat over millions of years to form coal seams. Coal is composed primarily of carbon along with variable quantities of other elements, chiefly hydrogen, sulfur, oxygen, and nitrogen.

Despite its poor environmental credentials, coal remains a crucial contributor to energy supply in many countries. Coal is the most wide-spread fossil fuel around the world, and more than 75 countries have it. The current share of coal in global power generation is over 40%, but it is expected to decrease in coming years, while the quantity in absolute will increase. Asia is massively powered by coal, in in 2012, 24% of energy was from coal. China alone uses as much coal as the rest of the world. The continuing popularity of coal becomes particularly obvious when compared to the current production figures with those from 20 years ago. While the global reserves of coal have decreased by 14% between 1993 and 2011, the production has gone up by 68% during the same period. The future of coal depends primarily on the advancement of clean coal technologies to mitigate environmental factors such as CO2 emissions. Today, Carbon Capture Utilization and Storage could potentially impact the future use of fossil fuels. The future of CCUS is uncertain however due to high costs and efficiency penalty.

Coal is readily available, cheaper to ship than natural gas (less than 20 USD/MT versus 250 USD/MT for liquefied natural gas and just 2 USD per MT for crude oil), safe, reliable and inexpensive (around 43 USD/MT in December 2015). Presently some 1.2 billion people live without access to modern energy services. Poverty can be eradicated by the responsible use of energy. Coal resources abound in many developing countries and coal could be part of a transitional hybrid achievable option for economic development which can gradually lead to

renewable resources.

Coal energy can originate in several coal types:

1.3.1 Peat:

Peat is an build-up of partly putrefied flora or carbon-based matter that is peculiar to natural regions termed peatlands or marshes. The peatland bionetwork is the most effectual carbon basin on earth since peatland plants detain CO2 which is naturally freed from the peat, consequently preserving an equipoise.

Peat is the surface carbon rich part of a soil, consisting of partially decomposed organic material, derived mostly from plants, that has accumulated under conditions of waterlogging, oxygen deficiency, acidity and nutrient deficiency. In moderate, boreal and sub-arctic regions, where lower level temperatures (below freezing for extended periods during the winter) reduce the rate of decomposition, peat is formed from mosses, herbs, shrubs and small trees (Joosten & Clarke, 2002). In the damp equatorial regions, it is made from rain forest trees (leaves, branches, trunks and roots) under conditions of high temperature almost all the time.

Peatlands are regions of countryside, having or not vegetation, that offer a naturally amassed outward peat layer. For an area to be termed as peatland, the width of the peat layer must be at least 20 cm if waterless, and 30 cm if damp. Peatland finds are commonly described on a surface area basis. Even where peat findings widths and total peat quantities are known, it is still difficult to accurately estimate the deposits of peat in energetic value.

The carbon rich part of peat deposits has, however, a rather stable anhydrous (contains no water), “without ash” calorific value of 20-22 MJ/kg and, if the total quantity of organic material is known, together with the average moisture and ash content, then the peat reserve can be expressed in standard energy units.

1.3.2 The Nature of Peatlands and Peat:

Worldwide, peatlands are major sinks of carbon. Peatlands are also crucial environmental ‘regulators’. Peat is accumulating on the ground all the time and the top layers of mires and peatlands form complex ecosystems.

Peat is the partly decomposed remains of the biomass that was produced, mostly by plants, on waterlogged substrates; it is mostly water saturated and therefore not compacted. The peat harvested today in the northern hemisphere was formed almost entirely over the last ten thousand years, after the withdrawal of the gigantic icebergs that once covered most regions in the Northern Hemisphere. Those vegetal kinds, which formed the basal (forming or belonging to a bottom layer or base) moss, are still forming peat today. Eighty five per cent of the earth’s peatland area is in just four countries: Russia, Canada, USA and Indonesia. Sizeable regions of moss-land in Europe, amounting to 450,000 km² (eleven per cent from the total world area), have been utilized for hundreds of years for husbandry and forestry.

1.3.3 Uses of Peat:

Peat (or moss) has multiple applications, which may be categorized under three main titles:

1. Energy (as fuel for electricity/heat generation, and directly as a source of heat for industrial, residential and other purposes). 2. Horticultural and agricultural (e.g. as growing medium, soil improver, cowshed/stable litter, compost ingredient). 3. Other (e.g. as a source of organic and chemical products such as activated carbon, resins and waxes, medicinal products such as steroids and antibiotics, and therapeutic applications such as peat baths and preparations).

1.3.4 Peat from a Climate Impact Point of View:

The Intergovernmental on Climate Change (IPCC) changed the classification of peat from fossil fuel to a separate category between fossil and renewable fuels (25th session of IPCC, Port Louis, Mauritius, 2006). Peat now has its own category: ‘peat’. The emission factor of peat is comparable to the emission factor of fossil fuels.

1.3.5 Lignite:

Lignite, habitually denoted as brown coal, is a lax brown combustible sedimentary rock bent from naturally compacted peat. It is viewed as the lowest rank of coal because its relatively low energetic content. Its carbon content is of the order of twenty five to thirty five per cent. It is extracted all around the world and is exploited almost solely as a fuel for steam-electric power generation, but is also sought for its content of germanium in China. Almost twenty seven per cent of ’s electricity is obtained from lignite power plants, whereas in Greece, lignite provides about half of the country’s needs in electricity.

Lignite is of a darkish color with brown shades and has an organic content of around twenty five to thirty five per cent, an elevated integral dampness content nearing at times peaks of sixty six per cent, with an ash content ranging from six per cent to nineteen per cent whereas bituminous coal has ash content of six to twelve per cent.

Strip mining lignite at Tagebau Garzweiler in

It is worth noting how comparatively low the energetic content of peat is if we contrast it to even that of coal. Whereas coal has an energetic content of around 27 million BTU’s (depending whether it is anthracite, lignite or graphite), peat has roughly half that amount (ten to twelve MJ/KG which is around nine to seventeen million BTU’s per metric ton). Energetic content depends on whether dampness or moisture and mineral matters are present. There are variations within pit mines within even the same region and certainly between countries (as an example; Australia and West Virginia in the USA).

Lignite presents flammability hazards in transportation and handling due to its volatile nature which can be turned into an advantage since its hydrocarbon ethereal content can be readily converted into petroleum products. Stringent safety measures can contain the fire hazard of lignite which increase the cost of coal as a source of energy.

1.3.6 Uses of Lignite:

Due to its comparatively depressed energy density (as compared to other fossil fuels like natural gas or crude oil) and usually elevated dampness levels, brown coal is expensive to transport (as compared to crude oil particularly) and is not sold on a trading basis significantly on the global marketplace compared with graphite or anthracite. Lignite is frequently burnt in electricity generating plants within proximity to mines, such as in Australia’s Latrobe Valley and Luminant’s Monticello plant in Texas. Particularly due to its covert elevated dampness and low energy density of brown coal, carbon dioxide emissions from traditional brown-coal-fired plants are usually far more elevated per megawatt produced than for similar black-coal plants, with the highest-emitting plant worldwide being Hazelwood Power Station, Victoria. The running of conventional browncoal plants, especially if combined with open pit mining, is highly debatable nowadays with the increasing political clout of environmental legislation.

1.3.7 Formation of Lignite:

Lignite starts as an amassment of partly putrefied vegetal matter, or moss referred to as well as peat (explained earlier).

Interment by other residues has for consequence growing temperature, conditional on the local geothermal gradient and tectonic setting, and augmenting pressure. This causes compaction of the material and loss of some of the water and evaporative matter (predominantly methane and carbon dioxide). This progression, termed coalification, concentrates the carbon content, and thus the energy density, of the material. Profounder interment and time have for consequence the further removal of dampness and evaporative matter, ultimately altering the material into higher energy coals such as bituminous and anthracite coal.

1.3.8 Sub-Bituminous Coal:

Sub-bituminous coal, also called black lignite, generally dark brown to black coal, midway in rank between lignite and bituminous coal according to the coal classification used in the United States and Canada. In many countries subbituminous coal is considered to be a brown coal.

1.3.9 Properties of Sub-Bituminous coal:

Sub-bituminous coals may be leaden, obscure brown to black, lax and flaky at the lower end of the range, to glossy jet-black, hard, and relatively strong at the upper end. They comprise fifteen to thirty per cent integral dampness by weight and experience slight bulge upon heating. The heat content of sub-bituminous coals range from 8,300 to 11,500 BTU/lb or 19,306 to 26,749 kJ/kg. Their comparatively low density and high dampness makes some types of subbituminous coals vulnerable to unprompted burning if not packed densely during storage in order to exclude free air flow.

1.3.10 Bituminous Coal:

Bituminous coal or black coal is a comparatively lax coal comprising a tarlike substance called bitumen. It is of better quality than lignite coal but of poorer quality than anthracite. Its development is usually the consequence of high pressure being exerted on lignite. Bituminous coal is an organic sedimentary rock formed by pressure of moss bog material. The carbon content of bituminous coal is around sixty to eighty per cent; the rest is composed of water, air, hydrogen, and sulphur. The heat content of bituminous coal ranges from 24 to 35 MJ/kg (21 million to 30 million BTU per short ton) on a moist, mineral-matterfree basis.

In the coal mining business, bituminous coal is recognized for freeing the largest amounts of firedamp, a hazardous blend of gases that can cause underground explosions. Extraction of bituminous coal demands the highest safety procedures involving attentive gas monitoring, good ventilation and vigilant site management.

1.3.11 Uses of Bituminous Coal:

Bituminous coals are graded according to vitrinite (Vitrinite is one of the primary components of coals and most sedimentary kerogens. Vitrinite is a type of maceral, where “macerals” are organic components of coal analogous to the “minerals” of rocks. Vitrinite has a shiny appearance resembling glass (vitreous)) reflectance, moisture content, volatile content, plasticity and ash content. Generally, the highest value bituminous coals have a specific grade of plasticity, volatility and low ash content, especially with low carbonate, phosphorus, and sulphur.

Plasticity is vital for coking as it represents its ability to gradually form specific plasticity phases during the coking process, measured by coal dilatation tests. Low phosphorus content is vital for these coals, as phosphorus is a highly damaging element in steel making.

Coking coal is best if it has a very narrow range of volatility and plasticity. This is measured by the free swelling index test. Volatile content and swelling index are used to select coals for coke blending as well.

Volatility is also critical for steel-making and power generation, as this determines the burn rate of the coal. High volatile content coals, while easy to ignite often are not as prized as moderately volatile coals; low volatile coal may be difficult to ignite although it contains more energy per unit volume. The smelter must balance the volatile content of the coals to optimize the ease of ignition, burn rate, and energy output of the coal.

Low ash, sulphur, and carbonate coals are prized for power generation because

they do not produce much boiler slag and they do not require as much effort to scrub the flue gases to remove particulate matter. Carbonates are deleterious as they readily stick to the boiler apparatus.

1.3.12 Steam Coal:

In electricity generation, thermal coal is ground to a powder and fired into a boiler to produce heat, which in turn converts water into steam. The steam powers a turbine coupled to an alternator, which generates electricity for the power grid.

1.3.13 Anthracite (Coal):

Anthracite is a hard, compact variety of coal that has a submetallic luster. It has the highest carbon content, the fewest impurities, and the highest calorific content of all types of coal, which also include bituminous coal and lignite. The carbon content of anthracite is between 92.1% and 98%. The term is applied to those varieties of coal which do not give off tarry or other hydrocarbon vapors when heated below their point of ignition. Anthracite ignites with difficulty and burns with a short, blue, and smokeless flame.

Anthracite is categorized into standard grade, which is used mainly in power generation, and high grade (HG) and ultra-high grade (UHG), the principal uses of which are in the metallurgy sector. Anthracite s for about 1% of global coal reserves, and is mined in only a few countries around the world. The heat content of anthracite ranges from 22 to 28 million Btu per short ton (26 to 33 MJ/kg) on a moist, mineral-matter-free basis. Chemically, anthracite may be considered as a transition stage between ordinary bituminous coal and graphite, produced by the more or less complete elimination of the volatile constituents of the former, and it is found most abundantly in areas that have been subjected to considerable earth-movement metamorphic stresses and pressures, such as the flanks of great mountain ranges. Anthracite is associated with strongly deformed sedimentary rocks that were subjected to higher pressures and temperatures (but short of metamorphic conditions) just as bituminous coal is generally associated with less deformed or flat-lying sedimentary rocks.

1.3.14 Anthracite Usage Presently:

Anthracite generally costs two to three times as much as regular coal. The principal use of anthracite today is for a domestic fuel in either hand-fired stoves or automatic stoker furnaces. It delivers high energy per its weight and burns cleanly with little soot, making it ideal for this purpose. Its high value makes it prohibitively expensive for power plant use.

1.3.15 Graphite (Coal):

Graphite is a crystalline form of carbon, a semimetal, a native element mineral, and one of the allotropes (allotropes are different forms of the same element. Different bonding arrangements between atoms result in different structures with different chemical and physical properties of carbon). Graphite is the most stable form of carbon under standard conditions. Graphite may be considered the highest grade of coal, just above anthracite and alternatively called metaanthracite, although it is not normally used as fuel because it is difficult to ignite.

1.3.16 Carbon Capture and Storage (CCS):

Carbon capture and storage (CCS) (or carbon capture and sequestration) is the process of capturing waste carbon dioxide (CO2) from large point sources, such as fossil fuel power plants, transporting it to a storage site, and depositing it where it will not enter the atmosphere, normally an underground geological formation. The aim is to prevent the release of large quantities of CO2 into the atmosphere (from fossil fuel use in power generation and other industries). It is a potential means of mitigating the contribution of fossil fuel emissions to global warming and ocean acidification. Although CO2 has been injected into geological formations for several decades for various purposes, including enhanced oil recovery, the long term storage of CO2 is a relatively new concept. The first commercial example was the Weyburn-Midale Carbon Dioxide Project in 2000. It is based in Canada. Other examples include SaskPower’s Boundary Dam also based in Canada, and the USA based Mississippi Power’s Kemper Project.

‘CCS’ can also be used to describe the scrubbing of CO2 from ambient air as a climate engineering technique.

Capturing and compressing CO2 may increase the fuel needs of a coal-fired CCS plant by 25–40%. These and other system costs are estimated to increase the cost of the energy produced by 21–91% for purpose built plants. Applying the technology to existing plants would be more expensive especially if they are far from a sequestration site. Recent industry reports suggest that with successful research, development and deployment (RD&D), sequestered coal-based electricity generation in 2025 may cost less than un-sequestered coal-based electricity generation today.

Storage of the CO2 is envisaged either in deep geological formations, or in the

form of mineral carbonates. Deep ocean storage is no longer considered feasible because it greatly increases the problem of ocean acidification. Geological formations are currently considered the most promising sequestration sites. The National Energy Technology Laboratory (NETL) reported that North America has enough storage capacity for more than 900 years’ worth of carbon dioxide at current production rates. A general problem is that long term predictions about submarine or underground storage security are very difficult and uncertain, and there is still the risk that CO2 might leak into the atmosphere.

1.3.17 Limitations of CCS for Power Stations:

Critics say large-scale CCS deployment is unproven and decades away from being commercialized. They say that it is risky and expensive and that a better option is renewable energy. Some environmental groups point out that CCS technology leaves behind dangerous waste material that has to be stored, just like nuclear power stations.

Another limitation of CCS is its energy penalty. The technology is expected to use between 10 and 40 percent of the energy produced by a power station. Widescale adoption of CCS may erase efficiency gains in coal power plants of the last 50 years, and increase resource consumption by one third. Even taking the fuel penalty into , however, overall levels of CO2 abatement would remain high at approximately 80–90%, compared to a plant without CCS. It is possible for CCS, when combined with biomass, to result in net negative emissions.

Let us keep in mind that as recently as February 2012, operational BECCS (Bioenergy with carbon capture and storage) plants operate on point emissions other than power stations, such as biofuel refineries.

The net contribution of a CCS applied to power plants is still controversial in of CO2 emissions: CCS requires considerably more energy –perhaps 25% more- which causes a higher usage level of coal and tends to drive operational costs up.

Another concern regards the permanence of storage schemes. Opponents to CCS claim that safe and permanent storage of CO2 cannot be guaranteed and that even very low leakage rates could undermine any climate mitigation effect. In

1986 a large leakage of naturally sequestered CO2 rose from Lake Nyos in Cameroon and asphyxiated 1,700 people. While the carbon had been sequestered naturally, some point to the event as evidence for the potentially catastrophic effects of sequestering carbon artificially.

On one hand, Greenpeace claims that CCS could lead to a doubling of coal plant costs. It is also claimed by opponents to CCS that money spent on CCS will divert investments away from other solutions to climate change.

Some recent credible estimates indicate that the cost of capturing and storing carbon dioxide is US$60 per ton, corresponding to an increase in electricity prices of 6c per kWh (based on typical coal-fired power plant emissions of 2.13 pounds CO2 per kWh). This would double the typical US industrial electricity price (now at around 6c per kWh) and increase the typical retail residential electricity price by about 50% (assuming 100% of power is from coal, which may not necessarily be the case, as this varies from state to state). Similar price increases would likely be expected in coal dependent countries such as Australia, because the capture technology and chemistry, as well as the transport and injection costs from such power plants would not, in an overall sense, vary significantly from country to country.

1.4.3 Shale Gas:

Shale (a fine-grained, fragment of sedimentary rock composed of mud that is a mix of flakes of clay minerals and tiny fragments (silt-sized particles) of other minerals, especially quartz and calcite) gas is natural gas produced from shale. Because shale has matrix permeability too low to allow gas to flow in economical quantities, shale gas wells depend on fractures to allow the gas to flow. Early shale gas wells depended on natural fractures through which gas flowed; almost all shale gas wells today require fractures artificially created by hydraulic fracturing. Since 2000, shale gas has become a major source of natural gas in the United States and Canada. Following the success in the United States, shale gas exploration is beginning in countries such as Poland, China, and South Africa. With the increase of shale production it has caused the United States to become the number one natural gas producer in the world.

1.4.4 Hydrates:

Huge quantities of natural gas (primarily methane) exist in the form of hydrates under sediment on offshore continental shelves and on land in arctic regions that experience permafrost, such as those in Siberia. Hydrates require a combination of high pressure and low temperature to form. In 2010, the cost of extracting natural gas from crystallized natural gas was estimated to 100–200 per cent the cost of extracting natural gas from conventional sources, and even higher from offshore deposits. In 2013, Japan Oil, Gas and Metals National Corporation (JOGMEC) announced that they had recovered commercially relevant quantities of natural gas from methane hydrate.

1.5.3 Fusion Power in Nuclear Energy:

Fusion power is the generation of energy by nuclear fusion. Fusion reactions are high energy reactions in which two lighter atomic nuclei fuse to form a heavier nucleus. This major area of plasma physics research is concerned with harnessing this reaction as a source of large scale sustainable energy.

In large scale commercial proposals, heat from the fusion reaction is used to operate a steam turbine that drives electrical generators, as in existing fossil fuel and nuclear fission power stations. Many different fusion concepts have come in and out of vogue over the years. The current leading designs are the tokamak and inertial confinement fusion (laser) approaches. As of December 2015, these technologies are not yet commercially viable. Currently, it takes more energy to initiate and contain a fusion reaction, than the energy it produces. Deuterium, one of two stable isotopes of hydrogen, is being used in nuclear fusion experiments.

1.6 Hydro-Electric Power:

Hydraulic power provides significant amount of energy throughout the world and is present in more than 100 countries, contributing about 15% of the global electricity production. Top 5 countries in the world in hydropower generation are: Brazil, Canada, China, Russia and the USA. China alone represents 24% of total hydropower installed capacity. Countries as different and distant from one another as Iceland, Nepal and Mozambique have 50% of their electricity generated from hydropower. In 2012, an estimated 27 to 30 GW of new hydropower and 2-3 GW of pumped storage capacity was commissioned. The use of Hydro-Electric power is expected to increase by 3.1% a year for the next quarter century.

In many cases, the growth in hydropower was facilitated by the lavish renewable energy facilities and CO2 penalties. Over the past two decades, the total globally installed hydropower has increased by 55% while the actual generation has increased by 21%. Globally installed capacity has increased by an estimated 8% over the last 5 years, but capacity utilization has dropped by 14% due to water shortages.

The cost of hydroelectricity is relatively low, making it a competitive source of renewable electricity. The average cost of electricity from a hydro station larger than 10 megawatts is 3 to 5 U.S. cents per kilowatt-hour. It is also a flexible source of electricity since the amount produced by the station can be changed up or down very quickly to adapt to changing energy demands. However, damming interrupts the flow of rivers and can harm local ecosystems, and building large dams and reservoirs often involves displacing people and wildlife. Once a hydroelectric complex is constructed, the project produces no direct waste, and has a considerably lower output level of the greenhouse gas carbon dioxide (CO2) than fossil fuel powered energy plants.

1.6.1 Streams and Rivers:

Streams and Rivers are a type of hydroelectric generation whereby little or no water storage is provided. What little water storage is needed is referred to as “pondage”. A plant without pondage has no water storage and is, therefore, subject to seasonal river flows. Thus, the plant will operate as an intermittent energy source while a plant with pondage can regulate the water flow at all times and can serve as a peaking power plant or base load power plant.

1.6.2 Marine Currents:

Marine current power is a form of marine energy obtained from harnessing the kinetic energy of marine currents. Although not widely used at present, marine current power has an important potential for future electricity generation. Marine currents are more predictable than wind and solar power.

Strong ocean currents are generated from a combination of temperature, wind, salinity, bathymetry (bathymetry is the study of underwater depth of lake or ocean floors), and the rotation of the earth. The sun acts as the primary driving force, causing winds and temperature differences. Because there are only small fluctuations in current speed and stream location with minimal changes in direction, ocean currents may be suitable locations for deploying energy extraction devices such as turbines. Other effects such as regional differences in temperature and salinity and the rotation of the earth are also major influences. The kinetic energy of marine currents can be converted in much the same way that a wind turbine extracts energy from the wind, using various types of openflow rotors.

The potential of electric power generation from marine tidal currents is enormous. There are several factors that make electricity generation from marine currents very appealing when compared to other renewables:

• The high load factors resulting from the fluid properties. The predictability of the resource, so that, unlike most of other renewables, the future availability of energy can be known and planned for. • The potentially large resource that can be exploited with little environmental impact, thereby offering one of the least damaging methods for large-scale electricity generation.

• The feasibility of marine-current power installations to provide also base grid power, especially if two or more separate arrays with offset peak-flow periods are interconnected.

1.6.3 Waves:

Wave power is the transport of energy by ocean surface waves, and the capture of that energy to do useful work – for example, electricity generation, water desalination, or the pumping of water (into reservoirs). A machine able to exploit wave power is generally known as a wave energy converter (WEC). Wave power is distinct from the diurnal flux of tidal power and the steady gyre of ocean currents. Wave-power generation is not currently a widely employed commercial technology, although there have been attempts to use it since at least in the nineteenth century. In 2008, the first experimental wave farm was opened in Portugal, at the Aguçadoura Wave Park. The major competitor of wave power is offshore wind power, with more visual impact.

1.6.4 Tides:

1.6.5 Osmotic Energy:

Osmotic power, salinity gradient power or blue energy is the energy available from the difference in the salt concentration between seawater and river water. Two practical methods for this are reverse electro-dialysis (RED) and pressure retarded osmosis (PRO). Both processes rely on osmosis with ion specific membranes. The key waste product is brackish water. This byproduct is the result of natural forces that are being harnessed: the flow of fresh water into seas that are made up of salt water.

In 1954 Pattle suggested that there was an untapped source of power when a river mixes with the sea, in of the lost osmotic pressure, however it was not until the mid ’70s where a practical method of exploiting it using selectively permeable membranes was outlined.

It is useful to give a definition of osmosis at this stage: It is the spontaneous net movement of solvent molecules through a semi-permeable membrane into a region of higher solute concentration, in the direction that tends to equalize the solute concentrations on the two sides. It may also be used to describe a physical process in which any solvent moves across a semipermeable membrane (permeable to the solvent, but not the solute) separating two solutions of different concentrations.

The technologies have been confirmed in laboratory conditions. They are being developed into commercial use in the Netherlands (RED) and Norway (PRO). The cost of the membrane has been an obstacle. A new, lower cost membrane, based on an electrically modified polyethylene plastic, made it fit for potential commercial use. Other methods have been proposed and are currently under development. Among them, a method based on electric double-layer capacitor technology and a method based on vapor pressure difference.

1.7 Biomass Energy:

Biomass contains stored energy. That’s because plants absorb energy from the sun through the process of photosynthesis. When biomass is burned, this stored energy is released as heat. Burning biomass releases carbon dioxide. However, plants also take carbon dioxide out of the atmosphere and use it to grow their leaves, flowers, branches, and stems. That same carbon dioxide is returned to the air when the plants are burned.

Many different kinds of biomass, such as wood chips, corn, and some types of garbage, are used to produce electricity. Some types of biomass can be converted into liquid fuels called biofuels that can power cars, trucks, and tractors. Leftover food products like vegetable oils and animal fats can create biodiesel, while corn, sugarcane, and other plants can be fermented to produce ethanol. Biomass includes plant or animal matter that can be converted into fibers or other industrial chemicals, including biofuels. Industrial biomass can be grown from numerous types of plants, including miscanthus, switchgrass, hemp, corn, poplar, willow, sorghum, sugarcane, bamboo, and a variety of tree species, ranging from eucalyptus to oil palm (palm oil).

1.8 Wind Energy:

Wind energy or wind power is extracted from air flow using wind turbines or sails to produce mechanical or electrical energy. Windmills are used for their mechanical power, wind-pumps for water pumping, and sails to propel ships.

Wind power as an alternative to fossil fuels, is plentiful, renewable, widely distributed, clean, produces no greenhouse gas emissions during operation, and uses little land. The net effects on the environment are far less problematic than those of nonrenewable power sources. Wind farms consist of many individual wind turbines which are connected to the electric power transmission network. Onshore wind is an inexpensive source of electricity, competitive with or in many places cheaper than coal or gas plants. Offshore wind is steadier and stronger than on land, and offshore farms have less visual impact, but construction and maintenance costs are considerably higher. Small onshore wind farms can feed some energy into the grid or provide electricity to isolated offgrid locations.

Wind power is very consistent from year to year but has significant variation over shorter time scales. It is therefore used in conjunction with other electric power sources to give a reliable supply. As the proportion of wind-power in a region increases, a need to upgrade the grid, and a lowered ability to supplant conventional production can occur. Power management techniques such as having excess capacity, geographically distributed turbines, dispatchable backing sources, sufficient hydroelectric power, exporting and importing power to neighboring areas, using vehicle-to-grid strategies or reducing demand when wind production is low, can in many cases overcome these problems. In addition, weather forecasting permits the electricity network to be readied for the predictable variations in production that occur.

As of 2014, Denmark has been generating around 40% of its electricity from wind, and at least 83 other countries around the world are using wind power to supply their electricity grids. Wind power capacity has expanded to 369,553 MW by December 2014, and total wind energy production is growing rapidly and has reached around 4% of worldwide electricity usage.

1.9 Solar Power:

Solar power is the conversion of sunlight into electricity, either directly using photovoltaics (PV), or through Solar Thermic Power (STP) or indirectly using concentrated thermodynamic solar power (CTSP). Concentrated solar power systems use lenses or mirrors and tracking systems to focus a large area of sunlight into a small beam. Photovoltaics convert light into an electric current using the photovoltaic effect.

1.9.1 Solar Thermic Power (STP):

STP is a form of solar energy which harnesses sunrays to heat a fluid (either liquid or gas). The energy received by the fluid can then be used either directly in household heating and usage of hot water or indirectly to generate steam which can activate engines that produce electricity for heating, ventilation and air conditioning (HVAC).

STP uses solar captors that transform sunrays into heat. The basis in physics that guide this transformation are absorption and thermic conduction.

1.9.2 Photovoltaic Solar Power (PV):

PV power is generated by the sun. Solar power is renewable because, though we like to point out that components we use are made with energy often obtained from fossil fuels and the components of a solar system are minerals and metals that are depletable. However a PV system produces up to forty times the energy it took to make it. The PV cell is an electronic component. It uses the photoelectric effect to convert the electromagnetic waves emitted by the sun into electricity. Several connected cells form a photovoltaic solar module. Several modules connected to each other constitute a solar installation. Electricity can be consumed where produced, stored or transported through a network. In December 2015, a global initiative to develop solar power was presented by India at COP 21.

In 2014, Asia was the fastest growing region, with more than 60% of global installations. China and Japan alone ed for 20 GW or half of worldwide deployment. Europe continued to decline and installed 7 GW or 18% of the global PV market, three times less than in the record-year of 2011, when 22 GW had been installed. For the first time, North and South America combined ed for at least as much as Europe, about 7.1 GW or about 18% of global total. This is due to the strong growth in the United States, ed by Canada, Chile and Mexico.

In of cumulative capacity, Europe is still the most developed region with 88 GW or half of the global total of 178 GW. Solar PV now covers 3.5% and 7% of European electricity demand and peak electricity demand, respectively. The Asia-Pacific region (APAC) which includes countries such as Japan, India and Australia, follows second and s for about 20% percent of worldwide capacity. In third position ranks China with 16%, followed by the Americas with about 12%. Cumulative capacity in the MEA (Middle East and Africa) region and ROW (rest of the world) ed for only about 3.3% of the global total. A great untapped potential remains for many of these countries, especially in the

Sunbelt countries (there are 66 countries referred to as Sunbelt and they are based within 35° of the Equator).

As in the year before, the world’s top installer of 2014 were China (+10.6 GW), followed by Japan (+9.6 GW) and the United States (+6.2 GW), while the United Kingdom (+2.3 GW) emerged as new European leader ahead of (+1.9 GW) and (+0.9 GW). remains for one more year the world’s largest producer of solar power with an overall installed capacity of 38.2 GW.

Chile (+0.4 GW) and South Africa (+0.8 GW) were the newcomers of 2014. South Africa entered the top 10 in added capacity rankings for the first time. There are now twenty countries around the world with a cumulative PV capacity of more than one gigawatt (see tabulation below after Sunbelt map picture). Thailand (1,299 MW), The Netherlands (1,123 MW), and Switzerland (1,076 MW), all crossed the gigawatt threshold in 2014. Based on IEA’s data, the available solar PV capacity in Italy, and Greece is now sufficient to supply between 7% and 8% of their respective domestic electricity consumption.

IHS Technology forecasts global solar PV installations to grow by 59 GW or 33% in 2015. The company also predicts an accelerated growth for concentrator photovoltaics, an increase in market-share of monocrystalline silicon technology over polycrystalline silicon, currently the leading semiconductor material used for solar cells and that solar power in California will provide more than 10 percent of the state’s annual power generation, higher than in Italy and .

1.9.3 Concentrated Thermodynamic Solar Power (CTSP):

Concentrated Thermodynamic solar power (also called concentrating solar power, concentrated solar thermal, and CSP) systems generate solar power by using mirrors or lenses to concentrate a large area of sunlight, or solar thermal energy, onto a small area. Electricity is generated when the concentrated light is converted to heat, which drives a heat engine (usually a steam turbine) connected to an electrical power generator or powers a thermochemical reaction.

CTSP is being widely commercialized and the CTSP market has seen about 740 megawatt (MW) of generating capacity added between 2007 and the end of 2010. More than half of this (about 478 MW) was installed during 2010, bringing the global total to 1,095 MW. Spain added 400 MW in 2010, taking the global lead with a total of 632 MW, while the US ended the year with 509 MW after adding 78 MW, including two fossil–CSP hybrid plants. The Middle East is also ramping up their plans to install CSP based projects and as a part of that Plan, Shams-I the largest CSP Project in the world has been installed in Abu Dhabi, by Masdar.

There is considerable academic and commercial interest internationally in a new form of CTSP, called STEM, for off-grid applications to produce 24 hour industrial scale power for mining sites and remote communities in Italy, other parts of Europe, Australia, Asia, North Africa and Latin America. STEM uses fluidized silica sand as a thermal storage and heat transfer medium for CTSP systems. It has been developed by Salerno-based Magaldi Industries. The first commercial application of STEM will take place in Sicily from 2015.

CTSP growth is expected to continue at a fast pace. As of January 2014, Spain had a total capacity of 2,300 MW making this country the world leader in CTSP. Interest is also notable in North Africa and the Middle East, as well as India and

China.

Solar Power is an important source of renewable energy and its technologies are broadly characterized as either ive solar or active solar depending on the way they capture and distribute solar energy or convert it into solar power. Active solar techniques include the use of photovoltaic systems, concentrated solar power and solar water heating to harness the energy, as explained above. ive solar techniques include orienting a building to the sun, selecting materials with favorable thermal mass or light dispersing properties, and deg spaces that naturally circulate air.

The International Energy Agency projected in 2014 that under its “high renewables” scenario, by 2050, solar photovoltaics and concentrated solar power would contribute about 16 and 11 percent, respectively, of the worldwide electricity consumption, and solar would be the world’s largest source of electricity. This is a shocking figure if we realize that in 2015, solar power s for a fractional percentage of global energy.

In the future, the largest new solar installations would be in China and India, the world’s fastest growing economies and most populated countries.

Photovoltaics were initially solely used as a source of electricity for small and medium-sized applications, from the calculator powered by a single solar cell to remote homes powered by an off-grid rooftop PV system. As the cost of solar electricity has fallen, the number of grid-connected solar PV systems has grown into the millions and utility-scale solar power stations with hundreds of megawatts are being built. Solar PV is rapidly becoming an inexpensive, lowcarbon technology to harness renewable energy from the Sun.

Commercial concentrated solar power plants were first developed in the 1980s.

The 392 MW Ivanpah installation is the largest concentrating solar power plant in the world, located in the Mojave Desert of California. Other large CSP plants include the SEGS (354 MW) in the Mojave Desert of California, the Solnova Solar Power Station (150 MW) and the Andasol solar power station (150 MW), both in Spain. The 579 MW Solar Star, in the United States, is the world’s largest PV power station.

1.10 Geothermal Energy:

Geothermal energy is the heat from the Earth. It’s clean and sustainable. Resources of geothermal energy range from the shallow ground to hot water and hot rock found a few miles beneath the Earth’s surface, and down even deeper to the extremely high temperatures of molten rock called magma. Almost everywhere, the shallow ground or upper 10 feet of the Earth’s surface maintains a nearly constant temperature between 50° and 60°F (10° and 16°C). Geothermal heat pumps can tap into this resource to heat and cool buildings. A geothermal heat pump system consists of a heat pump, an air delivery system (ductwork), and a heat exchanger; a system of pipes buried in the shallow ground near the building. In the winter, the heat pump removes heat from the heat exchanger and pumps it into the indoor air delivery system. In the summer, the process is reversed, and the heat pump moves heat from the indoor air into the heat exchanger. The heat removed from the indoor air during the summer can also be used to provide a free source of hot water.

Wells can be drilled into underground reservoirs for the generation of electricity. Some geothermal power plants use the steam from a reservoir to power a turbine/generator, while others use the hot water to boil a working fluid that vaporizes and then turns a turbine. Hot water near the surface of Earth can be used directly for heat. Direct-use applications include heating buildings, growing plants in greenhouses, drying crops, heating water at fish farms, and several industrial processes such as pasteurizing milk.

Hot dry rock resources occur at depths of 3 to 5 miles everywhere beneath the Earth’s surface and at lesser depths in certain areas. Access to these resources involves injecting cold water down one well, circulating it through hot fractured rock, and drawing off the heated water from another well. Currently, there are no commercial applications of this technology. Existing technology also does not yet allow recovery of heat directly from magma, the very deep and most powerful resource of geothermal energy.

Many technologies are being developed to take advantage economically and sustainably of geothermal energy; the heat from the earth. Worldwide, 11,700 megawatts (MW) of geothermal power went online in 2013. An additional 28 gigawatts of direct geothermal heating capacity was already installed for district heating, space heating, spas, industrial processes, desalination and agricultural applications as far back as 2010.

Geothermal power is cost effective, reliable, sustainable, and environmentally friendly, but has historically been limited to areas near tectonic plate boundaries. Recent technological advances have dramatically expanded the range and size of viable resources, especially for applications such as home heating, opening a potential for widespread exploitation. Geothermal wells release greenhouse gases trapped deep within the earth, but these emissions are much lower per energy unit than those of fossil fuels. As a result, geothermal power has the potential to help mitigate global warming if widely deployed in lieu of fossil fuels.

The Earth’s geothermal resources are theoretically more than adequate to supply humanity’s energy needs, but only a very small fraction may be profitably exploited. Drilling and exploration for deep resources is very expensive. Forecasts for the future of geothermal power depend on assumptions about technology, energy prices, subsidies, and interest rates. Pilot programs like EWEB’s customer opt in Green Power Program show that customers would be willing to pay a little more for a renewable energy source like geothermal. But as a result of government assisted research and industry experience, the cost of generating geothermal power has decreased by 25% over the past two decades.

1.10.1 Geothermal Economics:

In 2015, one kW.h generated from geothermal power costs around two cents US. Geothermal power requires no fuel (except for pumps), and is therefore immune to fuel cost fluctuations. However, capital costs can be significant to reach economies of scale (low cost per kW.h). Drilling s for over half the costs, and exploration of deep resources entails significant risks. A typical well doublet (extraction and injection wells) in Nevada can 4.5 megawatts (MW) and costs about $10 million to drill, with a 20% failure rate.

A power plant at The Geysers, California, USA.

Enhanced geothermal systems tend to be on the high side of these ranges, with capital costs above $4 million per MW and break–even above $0.03 per KW·h presently in 2015. Direct heating applications can use much shallower wells with lower temperatures, so smaller systems with lower costs and risks are feasible. Residential geothermal heat pumps with a capacity of 10 kilowatt (kW) are routinely installed. District heating systems may benefit from economies of scale if demand is geographically dense, as in cities and greenhouses, but otherwise piping installation dominates capital costs. The capital cost of one such district heating system in Bavaria was estimated at somewhat over 1 million € per MW. Direct systems of any size are much simpler than electric generators and have lower maintenance costs per KW·h, but they must consume electricity to run pumps and compressors. Some governments subsidize geothermal projects.

Geothermal power is highly scalable: from a rural village to an entire city.

The most developed geothermal field in the United States is The Geysers in

Northern California.

Geothermal projects have several stages of development. Each phase has associated risks. At the early stages of reconnaissance and geophysical surveys, many projects are cancelled, making that phase unsuitable for traditional lending. Projects moving forward from the identification, exploration and exploratory drilling often trade equity for financing.

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Global Energy Mix: Present And Future Projections (2035)

Technological breakthroughs tend to happen suddenly rather than according to a linear curve and they bring forth the full impact of economic consequences; a manna for knowledge based countries and upheaval for the rest.

Petroleum now represents 37% of global energy mix. Each yearly percentage point drop in its global contribution to energy generation could lead to 10% drop in price.

Whenever we venture to make long term predictions, we must be cognizant that we are not factoring in technological breakthroughs which can accelerate ongoing trends and bring about the sudden impact of repercussions: over the last five years alone, we witnessed the large scale commercialization of hydraulic fracturing, slanted drilling, a lighter and cheaper automotive solar powered battery, and a burgeoning of additional renewable energy sources which are now revolutionizing our industries and lives. The shock of energetic transition we are discussing could happen much faster than can now be predicted based on simple linear extrapolation. To the extent it is necessary to lay down well documented predictions, we present the analysis published by the USA based International Energy Agency (IEA) in 2014.

There is an obvious benevolent restlessness and impatience on the part of the industries of renewable energies to burst out of the cozy nest of minor

percentage contributions to the global energetic feedstock and substitute for fossil fuels, mostly coal and crude oil. The contribution of natural gas as a source of energy could inch up by at least three to four percentage points globally, over the next two decades.

In major economic poles, the pace of energetic feedstock substitution in favor of renewable sources has started to leap forward and we witness daily the most dominant of OECD (Organization for Economic Cooperation and Development) countries announce tangible targets to suppress to a minimum coal and crude oil usage and opt instead for renewable energy sources with a seeming predilection for photo-voltaic (PV) cells.

According to the IEA, the future of carbon capture and storage (CCS) appears foggy; no significant comparative benefits are tangibly obtainable and behemoth energy guzzlers such as China which alone consumes half the coal in the world have not opted for it on a large enough scale to make a difference. Instead, the direction now is to reap the benefits of years of research and development into clean renewable sources of energy.

The future of nuclear energy, looks uncertain as well, as per IEA’s report. A number of factors will determine whether nuclear energy will “retreat, recover, or undergo a renaissance.” The sector is grappling with workforce constraints as well as availability of heavy forging capacity to manufacture reactor vessels. In addition, nearly half of the 434 reactors operating in the world at the end of 2013 will be retired by 2040. The rate of retirements will pick up in the first half of the 2020’s, as reactors built during the 1970’s are taken offline, and then again in the late 2030’s. “This is set to pose challenges for industry and regulators and possibly strain engineering and project management capabilities,” the IEA predicted. Presently, China s for the most number of reactors to be added over the coming decade, but the installed percentage contribution of nuclear energy on a global scale is expected to stay at its current 13.5% or recede slightly. If there is a withdrawal from nuclear energy, natural gas and renewables will be the likeliest substitutes.

Renewables’ share of the global power mix is slated to nudge coal and crude oil to become the largest source of electricity by 2035, IEA projects. But how power profiles will change through the next couple of decades also varies tremendously across regions.

2.1 The Somersault Factor of Energy Cost:

Present predictions by the IEA report on future power generation costs in the top three world economies –European Union, USA and China- suggest the USA will have by far the lowest costs by 2040. The power costs in China in 2040 will be 75% higher than those in the USA and European power costs twice those of China. We must keep in mind that the report by the IEA predicts the power generation cost in the USA will rise from USD 55/MWh presently to close to USD 70/MWh in 2040 and yet the USA will still be the most competitive and attractive market for new energy hungry investments.

This spells a wave of prosperity could sweep through the USA with unprecedented economic expansion across economic sectors, fueled by organic growth as well as by incoming migration of investments from China and Europe; to name only those two major economies.

Global power costs are expected to rise from 1.6 trillion USD in 2013 to 2.9 trillion USD in 2040, according to the report by IEA. From 2014 to 2040, an average of around $770 billion (in 2013 dollars) will be poured into the world’s power sector, 58% to build new capacity and refurbish existing plants, and the remainder to expand transmission and distribution networks. The IEA suggested that at least one-fifth of investment in generation will go to wind, followed by about 16% each for hybrid installations of hydroelectric and coal, 13% for solar, and 11% for natural gas. Global subsidies for renewables will also increase, it projected, from $121 billion in 2013 (15% higher than in 2012) to $230 billion in 2030.

2.2 Energetic Feedstock Substitution in Major Economic Poles:

Each of the most powerful economies in the world would gain significantly on several fronts if it increased the pace of substitution from coal and crude oil to natural gas and renewables. Natural gas is much less polluting than coal and could be a growth engine for job creation but not to the same extent everywhere. Natural gas is more helpful than other fossil fuels in meeting environmental legislation. It exists galore in the USA and Russia but has to be piped or shipped in all of Europe and Japan. Natural gas use seems to be gaining ground over coal and crude oil.

The more renewable sources are adopted the better off the balance of trade of China, Europe and Japan to mention only those. As technological barriers are overcome more renewable sources will take over fossil fuel and nuclear sources of energy.

In the U.S.A new regulations are expected to stimulate a 40% increase in the use of natural gas for power and propel renewables’ growth by 165% over the coming decade.

The backbone of the shale gas revolution of the USA is the hydro-fracturing (fracking) and slanted drilling technologies that made it possible only in the USA to extract a million BTU from unconventional gas reserves at less than two US dollars as the technology matures and investments are depreciated. This makes it possible to extract from gas 5.55 million BTU’s (the energetic equivalent of one barrel of crude oil) at less than fifteen dollars. Presently, the West Texas Intermediate (WTI) crude oil barrel is trading around 35 USD and could fall to lower levels as it faces pressure from less demand on the one hand (engine efficiency and the eruption of electric car sales) and ever increasing competition from natural gas technologies such as Gas To Liquids (GTL) which consists of

converting methane to methanol in one step and extract all derivatives hitherto obtained from liquid crude oil.

This economic differentiating characteristic imposes natural gas as the substitute of crude oil for a great number of applications: as a fuel for hybrid or gas run vehicles, industrial combined heat and power applications as well as for household use and petrochemical feedstock. Over the next couple of decades, it is expected natural gas will constitute thirty five percent or more of total energy in the USA; while petroleum could drop to below thirty percent.

In the European Union (EU), renewables’ share will almost double, reaching 46% by 2040. As nuclear plants age and near retirement, decisions will need to be made as to whether new ones ought to be built or substitutes found. There is increasing askance toward nuclear power in Europe and calls to adopt natural gas as a future source of energy along with renewables. Presently several pipelines originating from Russia and the Baltics are being built or expanded to supply Eastern and Western Europe with natural gas.

China’s coal-fired generation share could drop from 76% in 2012 to 52% in 2040—while around 45% of new coal plants built during that period will have integrated gasification combined cycle plants. This becomes extremely significant once we are cognizant that China consumes half the coal of the world. India’s coal share could, meanwhile, fall from 72% to 55%, and new additions will also increase the average efficiency of the country’s coal fleet of plants.

The renewable industry is fast becoming an engine of economic development employing over 7.6 million people in 2014 and growing fast. Global renewable energy capacity has grown 120% in fourteen years from 2000 to 2014, IRENA report revealed in 2014, marking a record year for the renewable power sector with 133 GW global net additions. This is an average yearly growth of 8.57%; triple what the global economic growth is in a typical year. In contrast the

growth in demand for crude oil in 2015 has dipped below one percent to 0.9% while the world’s economic growth is expected to be 3%. The addiction of the world’s economy to oil seems to have ended. The quest for renewable energies is also undertaken by the most technologically advanced countries on earth.

A. USA:

Renewable energy in the United States ed for Natural Gas & Renewables will displace Petroleum and Coal by 2025

13.2 percent of the domestically produced electricity in 2014, and 11.2 percent of total energy generation. This is an increase of around thirty percent from the figure of eight percent shown above in the diagram; which is a substantial increase in five years and could be the augur of the era of renewables in the most powerful economy in the world. As of 2014, more than 143,000 people work in the solar industry in the USA and 43 states deploy net metering (a service to an electric consumer under which electric energy generated by that electric consumer from an eligible on-site generating facility and delivered to the local distribution facilities may be used to offset electric energy provided by the electric utility to the electric consumer during the applicable billing period). In the case of installed solar s, energy utilities buy back excess power generated by solar arrays. In 2011, the generation of energy from renewable sources sured what nuclear installations provided.

Hydroelectric power is currently a major contributor amongst renewables where it s for about one third of the energy produced. The United States is the fourth largest producer of hydroelectricity in the world after China, Canada and Brazil. The Grand Coulee Dam in the state of Washington (USA) is the 5th largest hydroelectric power station in the world.

U.S. wind power installed capacity now exceeds 60,000 MW and supplies 4% of the nation’s electricity. Texas is firmly established as the leader in wind power development, followed by Iowa and California.

Since the U.S. pioneered the technology with Solar One, several solar thermal power stations have also been built. The largest of these solar thermal power stations is the SEGS group of plants in the Mojave Desert in California with a total generating capacity of 354 MW, making the system the largest solar plant of any kind in the world. The largest photovoltaic power plant in the world are the Desert Sunlight Solar Farm, a 550 MW solar power plant under construction in Riverside County, California and the Topaz Solar Farm, a 550 MW photovoltaic power plant, being built in San Luis Obispo County, California. The Geysers in Northern California is the largest complex of geothermal energy production in the world.

The development of renewable energy and energy efficiency marks “a new era of energy exploration” in the United States, according to President Barack Obama. In a t address to the Congress on February 24, 2009, President Obama called for doubling renewable energy within the next three years. In his 2012 State of the Union address, President Barack Obama restated his commitment to renewable energy and mentioned the long-standing Interior Department commitment to permit 10 thousand Mega Watt of renewable energy projects on public land in 2012.

a. Biomass Power in the USA:

In the twelve months through April 2013, biomass generated 57 million megawatt-hours, 1.4% of total US electricity. It was the largest source of total renewable energy in the US. With proper conservation and growing techniques biomass can be an important renewable energy source.

b. Hydroelectric Power in the USA:

Hydroelectric power stations in the United States are currently the second largest producer of renewable energy in the U.S. after biomass, but the largest renewable source of electricity. Hydroelectric power produced 51% of the total renewable electricity in the U.S.A in 2013, and 6.8% of the total U.S. electricity.

c. Wind Power in the USA:

Landowners typically receive $3,000 to $5,000 per year in rental income from each wind turbine, while farmers continue to grow crops or graze cattle up to the foot of the turbines. Wind turbines are pleasant aesthetically and do not constitute any kind of inconvenience as their location is typically remote from urban areas.

The U.S. wind industry generates tens of thousands of jobs and billions of dollars of economic activity. Wind projects boost local tax bases, and revitalize the economy of rural communities by providing a steady income stream to farmers with wind turbines on their land. GE Energy is the largest domestic wind turbine manufacturer. In 2013 wind power received $5.936 billion in federal funding, which is 37% of all federal funding for electricity generation.

In 2012 there were 8,900 MW under construction in nearly 100 projects. The United States has the potential of installing 10 million MW of onshore wind power and 4 million MW of offshore wind. The U.S. Department of Energy’s report envisioned that wind power could supply 20% of all U.S. electricity, which included a contribution of 4% from offshore wind power. Additional transmission lines will need to be added, to bring power from windy states to the rest of the country.

d. Solar Power in the USA:

The USA now has the largest solar power plants in the world, and the use of solar energy is likely to increase exponentially as cheap natural gas is being used tly to run hybrid plants. Furthermore, as research and development yield more efficient and affordable s, solar power plants gain distinctive advantages over fossil fuel sources from the point of view of surface area usage. Feed in tariffs (FIT) are offered as incentives to households to install solar s on rooftops so they are reimbursed at an advantageous price any electricity they contribute to their community’s grid. FIT is a policy mechanism designed to accelerate investment in renewable energy technologies. It achieves this by offering long-term contracts to renewable energy producers, typically based on the cost of generation of each technology. Rather than pay an equal amount for energy, however generated, technologies such as wind power, for instance, are awarded a lower per-kWh price, while technologies such as solar PV and tidal power are offered a higher price, reflecting costs that are higher at the moment.

e. Geothermal Power in the USA:

The USA is the world leader in online capacity and the generation of electricity from geothermal energy. The most significant catalyst behind new industry activity is the Energy Policy Act of 2005. This Act made new geothermal plants eligible for the full federal production tax credit, previously available only to wind power projects. It also authorized and directed increased funding for research by the Department of Energy, and gave the Bureau of Land Management new legal guidance and secure funding to address its backlog of geothermal leases and permits. As a result, a number of greenfield geothermal plants are now under construction in the USA.

What is eye catching in the graph below is that a renewable energy such as geothermal power is not the apanage of economically and militarily powerful nations that have to deploy their armies to oil rich countries under one pretext or another to secure precious raw material, it can also be obtained as already asserted earlier by countries capable –if only occasionally- of civility: The USA is followed by three countries that do not count amongst powerful economies in the world, yet seek renewable energy sources for the benefits they yield in jobs created, knowhow implanted and higher conditions of safety, health and environment.

B. CHINA:

In 2013, China led the world in renewable energy production, with a total capacity of 378 GW, mainly from hydroelectric and wind power. As of 2014, China leads the world in the production and use of wind power, solar photovoltaic power, and smart grid technologies, generating almost as much water, wind, and solar energy as all of and ’s power plants combined. China’s renewable energy sector is growing faster than its fossil fuels and nuclear power capacity. Since 2005, production of solar cells in China has expanded 100-fold! As Chinese renewable manufacturing has grown, the costs of renewable energy technologies have dropped dramatically. Innovation has helped, but the main driver of reduced costs has been market expansion.

a. Wind Power in China:

With its large land mass and long coastline, China has exceptional wind resources: it is estimated China has about 2,380 gigawatts (GW) of exploitable capacity on land and 200 GW on the sea. At the end of June 2015, there were 105 GW of electricity generating capacity installed in China, more than the total nameplate capacity of China’s nuclear power stations. In 2014 it generated 138 TWh of electricity, 2.6% of the total. This is up from the 2012 figure of 99 TWh of wind electricity provided to the grid.

China achieved (and exceeded by twenty percent) its target earlier than expected when it completed in 2015 a 120 Gigawatt of grid connected wind power capacity and is now in a position to generate 190 terawatt-hours of wind power annually. There persists some technical hitches related to grid connectivity. During the 13th Five-Year Plan period (2016-2020), China will add more than 100 million kW of wind power capacity.

China has identified wind power as a key growth component of the country’s economy; researchers from Harvard and Tsinghua University have found that China could meet all of their electricity demands from wind power through 2030. However, in practice, the use of wind energy in China has not always kept up with the remarkable construction of wind power capacity in the country. In 2014, the US generated more electricity from wind, 167 TWh despite a lower capacity because of China’s connectivity and grid capacity problems.

b. Solar Power in China:

Solar power in China is a growing industry with over 400 photovoltaic (PV) companies. In 2013, China was the world’s leading installer of solar photovoltaics reaching a total installed capacity of 35.78GW by end-June 2015. Solar water heating is extensively implemented as well. China produces 63% of the world’s solar photovoltaics (PV). It has emerged as the world’s largest manufacturer as of June 2015. China has become a world leader in the manufacture of solar photovoltaic technology, with its six biggest solar companies having a combined value of over $15 billion. China has succeeded in manufacturing at the lowest cost photovoltaic s which it is now exporting and boosting its balance of trade.

c. Biomass and Fuel Power in China:

China has set the goal of attaining one percent of its renewable energy generation through bioenergy in 2020. The development of bioenergy in China is needed to meet the rising energy demand. Several institutions are involved in this development, most notably the Asian Development Bank and China’s Ministry of Agriculture. There is also an added incentive to develop the bioenergy sector which is to increase the development of the rural agricultural sector. China is the world’s third-largest producer of ethanol, after Brazil and the United States. There are concerns over the inefficiency of using land for biomass energy and resulting food shortages.

China’s main biomass resources are agricultural wastes, scraps from the forestry and forest product industries, and municipal waste. Agricultural wastes are widely distributed. Among them, the annual production of crop stalks alone sures 600 million tons; and crop stalks suitable to energy production are estimated to represent a potential of 12,000 PJ annually. Wastes from the processing of agricultural products and manure from livestock farms in theory could yield nearly 80 billion cubic meters of biogas. Scraps from forestry and forest product industries represent a resource equivalent to 8,000 PJ per annum.

Furthermore, with the implementation of China’s Natural Forest Protection Program (which includes logging bans and logging reductions over much of the nation’s natural forests) and its Sloping Cropland Conversion Program (which calls for the conversion of much of the nation’s sloping cropland to trees and grasses), it is expected that the amount of scraps from forestry and forest product industries used in energy applications will increase substantially, with the potential of reaching 12,000 PJ per annum by 2020.

Municipal waste in China is expected to reach 210 million tons per annum in

2020. If 60 percent of this is used is used in landfill methane applications, two to ten billion cubic meters of methane could be produced. “Energy crops” are a biomass energy resource with the potential for commercialization. There are many types of energy crops that are suited to growing in China. Chief among these are rapeseed and other edible oil plants and some plants that grow in the wild, such as sumac, Chinese goldthread, and sweet broomcorn. By 2020, such crops could potentially yield over 50 million tons of liquid fuel annually, including over 28 million tons of ethanol and 24 million tons of bio-diesel. In sum, whether burned directly, used to produce electricity, or used as a substitute liquid fuel, biomass energy resources have the potential for playing a decisive role in China’s energy supply.

d. Geothermal Power in China:

The National Energy istration of China is developing its 13th five-year plan (2016-2020) for the development and use of geothermal resources, in a move to further boost the development of the sector, according to China Securities Journal.

Industry analysts said that the plan is another important step towards nationwide utilization of geothermal resources following the release of guidelines on promoting the development and use of geothermal energy. The plan is an indicator that geothermal energy is being promoted as the next new growth source across China’s renewable energy sector following wind and solar.

According to the plan, annual geothermal utilization should reach 50 million tons of standard coal equivalent (a Unit representing energy generated by burning one metric ton (1000 kilograms or 2204.68 pounds) of coal, equivalent to the energy obtained from burning 5.2 barrels (700 kilograms) of oil or 890 cubic meters of natural gas that is, 29.39 gigajoules (GJ), 27.78 million Btu (MMBtu), or 8.14 megawatt hours (MWh)) by the end of 2020, by which time an integrated technological and industrial system for the development and use of geothermal resources will be put in place across the country. Officials also plan to construct an operational model for the development and use of geothermal resources most suited for each region.

According to the Chinese energy regulator’s geothermal energy guidelines released in February of 2013, a national geothermal energy data and information system will be established by the end of 2015, with hopes that a nationwide geothermal heating program will cover an area of 500 million square meters while installed geothermal capacity will be expanded to 100 MW. As of the end of 2013, China’s aggregate installed capacity of geothermal power generation

projects was a mere 27 MW with all projects located in Tibet, including the 25MW Yangbajin geothermal power station.

Wang Guiling, secretary-general of Geothermal Resources Survey Center, China Geological Survey, said that the plan, which will also include a government subsidy plan, is on track to be issued next year.

A number of Chinese companies, including Shanghai Hanbell Precise Machinery, Zhejiang Kaishan Compressor, Yantai Moon and Dalian Refrigeration, have jumped into the geothermal equipment market as the future for the market holds great promise thanks to the from the central government, according to a securities researcher.

The development and use of geothermal energy as a renewable clean energy is of great significance to the easing of the energy shortage as well as for environmental protection. As a country with substantial geothermal resources, China has 853 billion tons and 256 billion tons of standard coal equivalent in geothermal reserves and geothermal resources available for development, respectively, most of which are located in the eastern and southwestern parts of the country.

C. UNITED KINGDOM:

The total of all renewable electricity sources provided for 14.9% of the electricity generated in the United Kingdom in 2013, reaching 53.7 TWh. In the second quarter of 2015, renewable electricity penetration exceeded 25% and coal generation for the first time ever.

Renewable energy contributions to meeting the UK’s 15% target reduction of fossil fuel usage in total energy consumption by 2020, in accordance with the 2009 EU Renewable Directive, was 5.2% in 2013 as measured in accordance with the methodology set out in the Directive.

Interest in renewable energy in the UK has increased in recent years due to new UK and EU targets for reductions in carbon emissions and the promotion of renewable electricity power generation through commercial incentives such as the Renewable Obligation Certificate scheme (ROCs) and Feed in tariffs (FITs) and the promotion of renewable heat through the Renewable Heat Incentive. Historically hydroelectric schemes were the largest producers of renewable electricity in the UK, but these have now been sured by wind power schemes, for which the UK has large potential resources.

a. Wind Power in The United Kingdom:

Wind power delivers a growing fraction of the energy in the United Kingdom and at the beginning of January 2015, wind power in the United Kingdom consisted of 6,546 wind turbines with a total installed capacity of just under 12 gigawatts: 7,950 megawatts of onshore capacity and 4,049 megawatts of offshore capacity. The United Kingdom is ranked as the world’s sixth largest producer of wind power, having overtaken and Italy in 2012. Polling of public opinion consistently shows strong for wind power in the UK, with nearly three quarters of the population agreeing with its use, even for people living near onshore wind turbines. Wind power is expected to continue growing in the UK for the foreseeable future. Renewable UK estimates that more than 2 GW of capacity will be deployed per year for the next five years. Within the UK, wind power is the second largest source of renewable energy after biomass. We must that for energy to be supplied reliably from wind turbines, the wind speed, air density and turbine characteristics have to meet certain conditions. If wind speed is too low (less than about 2.5 m/s) then the wind turbines will not be able to make electricity, and if it is too high (more than about 25 m/s) the turbines will have to be shut down to avoid damage. When this happens other power sources must have the capacity to meet demand.

b. Ocean Power in The United Kingdom:

Due to the island location of the UK, the country has great potential for generating electricity from wave power and tidal power.

Till recently, wave and tidal power had received very little money for development and consequently ocean power development had lagged behind due to doubts over economic viability in the United Kingdom.

However, funding for the UK’s first wave farm was secured and the plant was inaugurated in March of 2015. It is the world’s largest, with a capacity of 3 MW generated by four Pelamis machines and a cost of over 4 million pounds. In the south of Scotland, investigations have taken place into a tidal power scheme involving the construction of a farm of ocean power plants. There are several other wave and tidal stream array projects under development in the UK and the sector has ambitions of ten arrays reaching financial close by 2020 across Europe, with the UK well placed for the lion’s share of this to be built in its waters. By building on the UK’s established marine engineering heritage, marine energy could lead to significant economic growth for the UK. In their 2011 Marine Green Growth paper The Carbon Trust estimate that UK companies could capture around 22% of the global market for marine energy which could be worth around £76 billion between now and 2050. Our 2013 Working for a Greener Britain and Northern Ireland report estimates that in the next decade wave and tidal stream energy could provide jobs for more than 20,000 people, contributing towards continued economic prosperity as we export our skills, services and products.

c. Biofuels Power in The United Kingdom:

Gas from sewage and landfill (biogas) has already been exploited in some areas. Around a decade ago (end of 2004) it provided 129.3 GW·h (up 690% from 1990 levels!), and was the UK’s leading renewable energy source, representing 39.4% of all renewable energy produced (including hydro). The UK has committed to a target of 10.3% of renewable energy in transport to comply with the Renewable Energy Directive of the European Union and has started to implement legislation to meet this target.

d. Solar Power in The United Kingdom:

Solar power use in United Kingdom although relatively unknown in the UK until recently, has skyrocketed in use in recent years, albeit from a small base, as a result of reductions in the cost of photovoltaic (PV) s, and the introduction of a feed-in tariff (FIT) subsidy in April 2010.

At the end of 2011, there were 230,000 solar power projects in the United Kingdom, with a total installed generating capacity of 750 megawatts (MW). By February 2012 the installed capacity had reached 1,000 MW. In 2012, the government said that 4 million homes across the UK will be powered by the sun within eight years, representing 22,000 MW of installed solar power capacity by 2020.

e. Hydroelectric Power in The United Kingdom:

As of 2012, hydroelectric power stations in the United Kingdom ed for 1.67 GW of installed electrical generating capacity, being 1.9% of the UK’s total generating capacity and 14% of UK’s renewable energy generating capacity. Annual electricity production from such schemes is approximately 5,700 GWh, being about 1.5% of the UK’s total electricity production. The potential for further practical and viable hydroelectricity power stations in the UK is estimated to be in the region of 146 to 248 MW for England and Wales, and up to 2,593 MW for Scotland. However, by the very nature of the remote and rugged geographic locations of some of these potential sites, in national Parks or other areas of outstanding natural beauty, it is likely that environmental concerns would mean that a large number of them would be deemed not to be suitable, or could not be developed to their full theoretical potential.

Interest in hydropower in the UK has been renewed in recent years due to new UK and EU targets for reductions in Carbon emissions and the promotion of renewable energy power generation through commercial incentives such as the Renewable Obligation Certificate scheme (ROCs). The Renewables Obligation (RO) is designed to encourage generation of electricity from eligible renewable sources in the United Kingdom. It was introduced in England and Wales and in a different form (the Renewables Obligation (Scotland)) in Scotland in April 2002 and in Northern Ireland in April 2005, replacing the Non-Fossil Fuel Obligation which operated from 1990. The RO places an obligation on licensed electricity suppliers in the United Kingdom to source an increasing proportion of electricity from renewable sources, similar to a renewable portfolio standard. In 2010/11 it is 11.1% (4.0% in Northern Ireland). This figure was initially set at 3% for the period 2002/03 and under current political commitments will rise to 15.4% (6.3% in Northern Ireland) by the period 2015/16 and then it runs until 2037 (2033 in Northern Ireland). The extension of the scheme from 2027 to 2037 was declared on 1st April 2010 and is detailed in the National Renewable Energy Action Plan. Since its introduction the RO has more than tripled the level of eligible renewable electricity generation (from 1.8% of total UK supply to 7.0%

in 2010) and Feed in tariffs (FITs). Prior to such schemes, previous studies to assess the available hydro resources in the UK had discounted a large number of sites for reasons of poor economic or technological viability, but more recent studies over the past seven years by the British Hydro Association (BHA) have identified a larger number of viable sites due to improvements in the available technology and the economics of ROCs and FITS.

Schemes up to 50 kW are eligible for FITs, and schemes over 5 MW are eligible for ROCs. Schemes between 50 kW and 5 MW can choose between either. The UK Government’s National Renewable Energy Action Plan of July 2010 envisages between 40 MW and 50 MW a year of new hydropower schemes being installed annually up to 2020. The most recent for new hydro schemes is for 2009, and approximately 15 MW of new hydropower was installed during that year. It therefore remains to be seen if the ROC and FIT incentives will be enough for these ambitious targets to be met.

f. Geothermal Power in The United Kingdom:

The potential for exploiting geothermal energy in the United Kingdom on a commercial basis was initially examined by the Department of Energy in the wake of the 1973 oil crisis. Several regions of the country were identified, but interest in developing them was lost as petroleum prices fell. Although the UK is not actively volcanic, a large heat resource is potentially available via shallow geothermal ground source heat pumps, shallow aquifers and deep saline aquifers in the Mesozoic (During the Mesozoic, or “Middle Life” Era, life diversified rapidly and giant reptiles, dinosaurs and other monstrous beasts roamed the Earth. The period, which spans from about 252 million years ago to about 66 million years ago, was also known as the age of reptiles or the age of dinosaurs) basins of the UK. Geothermal energy is plentiful beneath the UK, although it is not readily accessible currently except in specific locations.

g. Microgeneration And Community Energy Systems:

Microgeneration technologies are seen as having considerable potential by the Government. However, the microgeneration strategy launched in March 2006 was seen as a disappointment by many commentators. Microgeneration involves the local production of electricity by homes and businesses from low-energy sources including small scale wind turbines, and solar electricity installations. The Climate Change and Sustainable Energy Act 2006 is expected to boost the number of microgeneration installations. The Renewable Heat Incentive was introduced from 28th of November 2011 to microgeneration of heat from ground source heat pumps, solar thermal s and biomass boilers, but only for non-domestic dwellings. The Government is highly likely to extend the RHI to domestic dwellings throughout the next decade. Sustainable community energy systems, pioneered by Woking Borough Council, provide an integrated approach to using cogeneration, renewables and other technologies to provide sustainable energy supplies to an urban community. It is expected that the same approach will be developed in other towns and cities, throughout the United Kingdom.

D. :

is a role model ultramodern country sourcing its energy increasingly from green sources with decreasing adverse impact on the environment. ’s renewable energy sector is among the most innovative and successful worldwide. Net electricity generation from renewable energy sources in the German electricity sector has increased from 6.3% in 2000 to about 30% in 2014. For the first time ever, wind, biogas, and solar combined ed for a larger portion of net electricity production than brown coal. While peakgeneration from combined wind and solar reached a new all-time high of 74% in April 2014, wind power saw its best day ever on December 12th, 2014, generating 562 GWh! has been called “the world’s first major renewable energy economy”.

More than 23,000 wind turbines and 1.4 million solar PV systems are distributed all over the country’s area of 357,000 square kilometers. As of 2011, ’s federal government is working on a new plan for increasing renewable energy commercialization, with a particular focus on offshore wind farms. A major challenge is the development of sufficient network capacities for transmitting the power generated in the North Sea to the large industrial consumers in southern parts of the country.

According to official figures, some 370,000 people were employed in the renewable energy sector in 2010, especially in small and medium-sized companies. This is an increase of around 8% compared to 2009 (around 339,500 jobs), and well over twice the number of jobs in 2004 (160,500). About twothirds of these jobs are attributed to the Renewable Energy Sources Act

’s energy transition, (the Energiewende), designates a significant change in energy policy from 2011. The term encomes a reorientation of

policy from demand to supply and a shift from centralized to distributed generation (for example, producing heat and power in very small cogeneration units), which should replace overproduction and avoidable energy consumption with energy-saving measures and increased efficiency.

is spearheading a blitzkrieg energetic transition it energiewende which is a revolution to be undergone by all powerful economies mindful of an environmental day of reckoning they wish to avoid. In 2015, close to thirty percent of ’s electricity was supplied by renewable sources like wind or solar power. This a three hundred percent increase over the last decade and is higher than what the USA can boast today. One factor of catalysis to the energy transition in (and indeed throughout the ultra-developed world) is the Fukushima disaster in Japan in 2011.

A decision was promptly taken by the German Chancellor Angela Merkel in the wake of the meltdown at Fukushima to withdraw from operation all its seventeen operating nuclear reactors when the time comes to decide whether to retire them or build new ones; which means that by 2022 will have no nuclear reactor operating. Nine have been retired already and renewable sources have compensated for their interrupted contribution and even substituted for a share of fossil fuel sources. has set itself lofty ecological ambitions; it intends to cut by forty percent its emissions by 2020 as compared to 1990 levels and by eighty percent by 2050.

a. Wind Power in :

In 2010, Wind power in provided over 96,100 people with jobs and German wind energy systems are also exported. The Fuhrländer Wind Turbine Laasow, built in 2006 near the village of Laasow, Brandenburg, was for six years the tallest wind turbine in the world.

In , hundreds of thousands of people have invested in citizens’ wind farms across the country and thousands of small and medium-sized enterprises are running successful businesses in a new sector that employ over 100,000 people today and generate close to ten percent of ’s electricity. Wind power has gained very high social acceptance in .

Repowering, the replacement of first-generation wind turbines with modern multi-megawatt machines, is occurring in . Modern turbines make better use of available wind energy and so more wind power can come from the same area of land. Modern turbines also offer much better grid integration since they use a connection method similar to conventional power plants.

In 2013, wind power generated a total of 53.4 TWh of electricity and more than 3.2 GW of new capacity was added to the grid. According to EWEA, in a normal wind year, installed wind capacity in will meet close to fifteen percent of the German electricity needs.

More than 21,607 wind turbines are located in the German federal area and the country has plans to build more. Presently, ’s federal government is working on a new plan for increasing renewable energy commercialization, with a particular focus on offshore wind farms. A major challenge is the development

of sufficient network capacities for transmitting the power generated in the North Sea to the large industrial consumers in southern .

Offshore wind energy also has great potential in . Wind speed at sea is 70 to 100% higher than onshore and much more constant. A major challenge will be the lack of sufficient network capacities for transmitting the power generated in the North Sea to the large industrial consumers in southern . In 2014, all in all 410 turbines with 1,747 megawatts were added to ’s offshore windparks. Due to not yet finished grid-connections, only turbines with combined 528.9 megawatts were added to the grid feed at the end of 2014.

The 2010 “Energiewende” policy has been embraced by the German federal government and has resulted in a huge expansion of renewables, particularly wind power. ’s share of renewables has increased from around 5% in 1999 to 17% in 2010, reaching close to the OECD average of 18% usage of renewables. Producers have been guaranteed a fixed feed-in tariff for 20 years, guaranteeing a fixed income. Energy co-operatives have been created, and efforts were made to decentralize control and profits. The large energy companies have a disproportionately small share of the renewables market. Nuclear power plants were closed, and the existing 9 plants will close earlier than necessary, in 2022.

The reduction of reliance on nuclear plants has so far had the consequence of increased reliance on fossil fuels and on electricity imports from . However, in good wind exports to ; in January 2015 the average price was €29/MWh in , and €39/MWh in . One factor that has inhibited efficient employment of new renewable energy has been the lack of an accompanying investment in power infrastructure (SüdLink) to bring the power to market.

b. Biomass Power in :

Biomass used for the production of biogas and biofuels are some of ’s most important sources of renewable energy. In 2010, biomass ed for 30% of renewable electricity. is now blending 6.25% biofuels in petroleum by to be in compliance with the Biofuels Quota Act. New German legislation, which will become effective in 2015, has resulted in a drastic improvement of the climate performance of biodiesel produced in .

In , legislation had made it a priority to meet greenhouse gas emissions regardless of the efficiency of the renewable raw material used.

c. Solar Power in :

The price at which solar photovoltaic (PV) s is selling in 2015 in is sixty percent cheaper than nine years ago, and is likely to cause an expansion of this sector in years to come. Yet, solar power in ed for an estimated 6.2 to 6.9 percent of the country’s net-electricity generation in 2014. The country has been the world’s top PV installer for several years and still leads in of the overall installed capacity, that amounted to 39,484 megawatts (MW) by the end of October 2015, ahead of China, Japan, Italy, and the United States.

About 1.5 million photovoltaic systems are installed all over the country, ranging from small rooftop systems, to medium commercial and large utility-scale solar parks, that altogether contributed 35.2 terawatt-hours (TWh).

This brings the country’s share of renewable electricity to about 31 percent, and in line with the official governmental goal of reaching 35 percent by 2020.

The official governmental goal is to continuously increase renewables’ contribution to the country’s overall electricity consumption. Long-term minimum targets are 35% by 2020, 50% by 2030 and 80% by 2050. The country is increasingly producing more electricity than it needs, driving down spotmarket prices and exporting its surplus of electricity to its neighboring countries (record exported surplus of 32 TWh in 2013 and 34 TWh in 2014). Paradoxically, a decline in spot-prices may well raise the electricity prices for retail customers, as the spread of the guaranteed feed-in tariff and spot-price increases as well. As the combined share of fluctuating wind and solar is approaching 17 percent on the national electricity mix, other issues are becoming more pressing. These include, adapting the electrical grid, constructing new gridstorage capacity, dismantling and altering fossil and nuclear power plants –

brown coal and nuclear power are the country’s cheapest suppliers of electricity, according to today’s calculations – and to construct a new generation of combined heat and power plants.

d. Hydroelectric Power in :

ing for 3.5 percent of ’s electricity output, hydroelectric power is the country’s second biggest form of renewable energy after wind. But the economic and ecological sense of creating more water power facilities is a divisive issue. Proponents of hydroelectric power in posit that water could provide at least a third more electricity in . Their hopes lie largely with miniature plants - small, decentralized facilities with outputs up to five megawatts. They currently are responsible for 20 percent of ’s hydropower. Such facilities are often enough to provide energy for small communities.

The federal government sponsored a 2008 study of German rivers and streams discovering 15,000 embankments and barrages not yet used for generating power. Industry representatives would like to see hydro facilities for as much energy production as nuclear power plants, but environmental objections stand in their way. German legislators ed a 2009 bill with incentives to produce electricity in environmentally-friendly ways. Those who equip their small-scale hydro facilities with ecologically-sound measures, like fish ladders, will receive more money for each watt they contribute to the power supply.

e. Geothermal Power in :

Geothermal power in is expected to grow, mainly because of a law that benefits the production of geothermal electricity and guarantees a feed-in tariff. The contribution to electricity generation in is still fractional in 2015. However after a renewable energy law that introduced a tariff scheme of EU €0.15 [US $0.23] per kilowatt-hour (kWh) for electricity produced from geothermal sources came into effect about a decade ago, a construction boom was sparked and the new power plants are now starting to come online and geothermal power will make more inroads in in years to come. The picture below projects a utopian vision of total energetic independence from fossil fuels by the middle of the twenty first century.

Whether it is achievable is subject to debate but there is no doubt that renewable sources (including geothermal) are set to continue making quantum leaps liberating us from polluting and utterly unhealthy sources like coal and crude oil.

E. :

Over three quarters of ’s electricity is sourced from nuclear reactors; however as these age decisions have to be made as to whether to remain relying on atomic fission for energy and to what extent. is the smallest emitter of carbon dioxide among the G8, precisely thanks to nuclear power. As a result of large investments in nuclear technology, most electricity produced by is generated by 59 nuclear power plants. also uses hydroelectric dams to produce electricity, such as the Eguzon dam, Étang de Soulcem, and Lac de Vouglans.

It is to be noted that despite its independence from crude oil in electricity generation, still uses crude oil derivatives for transportation in amounts that add up to slightly higher levels than in the UK but lagging behind ’s. The French government is phasing out subsidy on diesel to align its cost with that of gasoline.

is second only to in the European Union as far as renewable energy production is concerned. has considerable renewable energetic resources: Hydraulic, wind, and geothermal power. The Hexagon possesses one of the largest forests of the European continent after Sweden, Finland and Spain in that regard. Thanks to ’s littoral façade it has a source of wind power, which includes offshore rivaling with that of the UK. Overseas territories belonging to (French Guiana, Guadeloupe, Martinique, Mayotte, and Réunion) offer investment opportunities in wind and solar power. It is worth noting that in , hydraulic and biomass (wood) power constitute two thirds of renewable energies. Yet, solar power has skyrocketed in use over the last couple of years increasing by a staggering 216%! Wind power has increased by one third over since 2013.

According to reports issued after the COP21 held in Paris in December 2015, is amongst the countries that is likely to miss its 2020 target in renewable substitution.

ADEME (Agence de l’Environnement et de la Maîtrise de l’Énergie) is a public institution with a commercial and industrial character and has a mission to improve the environment. It was created in 1991. ADEME strives to encourage, animate and coordinate and facilitate and realize projects having as an objective the protection of the environment and the sound management and use of energy. It has a budget of 690 million Euros and employs 963 full time staff.

a. Biofuel Power in :

Biofuel in can be split in two main parts: the use of wood and the use of animal and municipal waste including human feces. In 2013, ADEME published its report regarding the use of wood for heat generation:

Due to the efficiency of home heaters, the consumption of wood logs (expressed as “stère” which is roughly equal to one cubic meter) has not increased significantly in 1999: from 6.8 Million of metric tons of oil equivalent to 6.9 (MTOE: A unit representing energy generated by burning one metric ton (1000 kilograms or 2204.68 pounds) or 7.4 barrels of oil, equivalent to the energy obtained from 1,270 cubic meters of natural gas or 1.4 metric tons of coal that is, 41.87 gigajoules (GJ), 39.68 million Btu (MMBtu), or 11.63 megawatt hours (MWh)). The number of households using wood fueled home heaters increased from 5.9 million to 7.4 million in 2012. With the decreasing price of crude oil – which causes a decrease in the price of oil based fuels- it is expected the demand for wood will see a decrease in growth.

The collection of methane on an industrial scale from animal manure and human waste (including municipal) has started in ; albeit yet at a nascent level. Presently there are installations in place to stock nonhazardous refuse of animal manure and equipped to collect methane which can then be purified and injected into grids for multiple use: as a source of fuel or as a raw material to obtain fertilizers and other industrial raw material for the plastic industry. The Government has now installed several such “Methanizers” and there are more projects in the pipeline. In Strasbourg, there is a station that produces over 1.6 million cubic meters of methane to process the refuse of over a million inhabitants and supply power to hundreds of thousands of citizens while reducing the emissions of carbon dioxide. By 2020, the French Government aims to have such “Methanizer” plants throughout the Hexagon. There are technical challenges to be overcome to reach targets in investment returns but it seems the citizenry and the Government are irreversibly committed to make

biofuel power a success in .

b. Geothermal Power in :

According to the French Association of Geothermal Professions (AFPG), holds the fifth place of geothermal generation amongst European countries. About two percent of the French population received its heating requirement from geothermal sources. Presently, geothermal energy projects in target mostly temperature basins of low heat levels (one hundred degrees celsius) primarily in the Parisian basin. There is only one high temperature geothermal power station producing electricity from liquids at very high temperatures located in Guadeloupe; it is called The Geothermal Centrale of Bouillante. is actively developing an expertise in the technology of Enhanced Geothermal System (EGS) which targets fluids present in naturally fractured reservoirs in non- volcanic regions.

The scientific project of Soulz-Sous-Forêts in 2010, in Alsace is the first in the world to have been connected to the electric grid. Ever since, twenty five permits for research projects in geothermal energy have been granted. In 2014, a group of companies including Alstom, EDF, GDF Suez (Engie), or Eiffage Clemessy. Such companies nurture the ambition of delivering turnkey projects. AFPG aims to develop several small projects ranging in capacity from fifty megawatts to three hundred megawatts throughout . The nature of the subsoil can be volcanic or not. It is to be kept in mind that a megawatt of power can satisfy the energetic needs of about one hundred and fifty households, depending on the country.

c. Hydroelectric Power in :

is second only to Norway in hydroelectric power generated, with nearly seventy terawatt hours produced in 2014 which covers the needs of close to forty percent of the population. Hydroelectric power in represents thirteen percent approximately of total electric production and one third of renewable electricity produced. Hydroelectric power employs skilled staff in a number of energy engineering disciplines and other domains as well which contribute dynamically to economic growth. has set for objective to increase by three terawatt hours its hydroelectric generating capacity by 2020 which will create two thousand jobs for the next ten years. Nearly four billion Euros will be contributed to the national treasury from taxes paid by the hydroelectric industry.

d Solar Power in :

ranks sixth in Solar Thermic Power at the European scale, but in of surface area covered per capita, ranks in the eighteenth position in Europe. A mere 0.4% of renewable energy is produced by STP in .

Photovoltaic power took off in use in at the beginning of the century due to feed in tariffs and net metering adopted by the government. PV power ed for 1.1% of electricity produced in in 2014. occupies the forth place in Europe after , Italy and Spain.

The branch of Concentrated Thermodynamic Solar Power is turning into an export industry for , where such a plant exists in the South of . Multinationals in energy such as Areva Solar, Total and Alstom have signed some big contracts in the Middle East, India, China and Australia to build STP plants.

e. Renewable Energies in The Overseas Territories of :

The dominant contribution of biomass in the Overseas Territories (Départements d’Outremer) which stood at 44% of renewables as of 2011 is due principally to the abundance of sugar canes from which bagasse –a fibrous residue from sugar canes- is extracted and can serve as fuel (however inefficient due to moisture) or to make cellulose which can be a precursor to consumer products. Hydraulic power stood at 23% in contribution to electricity. Wind power is scarce due to cyclone prone regions in the Overseas Territories.

Overseas Territories have to produce half of their power from renewables by 2020; which is a fifty percent increase from the present. Cost of electricity in the Overseas Territories is higher than in where a grid comprised of nuclear and supplemented by other sources offers a relatively more balanced cost structure. Geothermal energy and Tidal and Wave Power have potential in the Overseas Territories, particularly at the Reunion island where 130,000 solar thermal powered heaters have been installed.

F. JAPAN:

Japan has had to go through soul searching to rethink its energetic sources after the Fukushima nuclear leaks of 2011 which happened after a 9.0 Richter scale earthquake hit the shores of Sendai, northeast of Tokyo. Prior to this accident, nuclear power had met nearly twenty seven percent of Japan’s power requirements, and ever since this accident the Government of Japan has been challenged to find the optimal balance in energetic sources, sustainable economically and environmentally. In the aftermath of the Fukushima accident, Japan replaced the significant loss of nuclear power with generation from imported natural gas, low-sulfur crude oil, fuel oil, and coal.

a. Solar Power in Japan:

Solar power in Japan has been expanding since the late 1990s. The country is a leading manufacturer of photovoltaics (PV) and a large installer of domestic PV systems with most of them grid connected. The insolation is good at about 4.3 to 4.8 kWh/(m²·day). Japan is the world’s fourth largest energy consumer, making solar power an important national priority since the country’s shift in policies toward renewables after Fukushima in 2011.

Japan was the world’s second largest market for solar PV growth in 2013 and 2014, adding a record 6.9 GW and 9.6 GW of nominal nameplate capacity, respectively. By the end of 2014, cumulative capacity reached 23.3 GW, suring Italy (18.5 GW) and becoming the world’s third largest power producer from solar PV, behind (38.2 GW) and China (28.2 GW). Overall installed capacity is now estimated to be sufficient to supply 2.5% of the nation’s annual electricity demand. On June 18th, 2012, a new feed-in tariff was approved, of 42 Yen/kWh, about 0.406 Euro/kWh or USD 0.534/kWh. The tariff covers the first ten years of excess generation for systems less than 10 kW, and generation for twenty years for systems over 10 kW. It became effective July 1st, 2012. In 2013, Japan is expected to install 5-9 GW of solar power (nameplate wattage). In April 2013, the FIT was reduced to 37.8 Yen/kWh. The FIT was further reduced to 32 Yen/kWh in April 2014. The rationale behind the tariff reduction is that the cost of solar power installations is going down, and households who once paid a higher cost of installation have had their investment partially depreciated and realized some return on it.

The government set solar PV targets as follows:

• 28 GW of solar PV capacity by 2020

• 53 GW of solar PV capacity by 2030 • 10% of total domestic primary energy demand met with solar PV by 2050

As a rule of thumb, a gigawatt can supply power to an estimated 150,000 to 250,000 homes (The gigawatt is equal to one billion (10 ) watts or 1 gigawatt = 1,000 megawatts), depending the country (variables are demographic growth, industrialization and other factors as well).

It is clear Japan has made a strategic choice to source energy increasingly from solar power.

b. Wind Power in Japan:

It has been estimated that Japan has the potential for 144 GW for onshore wind and 608 GW of offshore wind capacity. In Japan’s electricity sector wind power generates a small but increasing proportion of the country’s electricity, as the installed capacity has been growing in recent years. According to industry observers, the 2011 Japanese nuclear accidents are pushing wind power to the forefront as a safer and more reliable alternative to meet the country’s future electricity requirements. None of Japan’s commercial wind turbines, totaling over 2,300 MW in nameplate capacity, failed as a result of the 2011 Tōhoku earthquake and tsunami, including the Kamisu offshore wind farm directly hit by the tsunami. This is in sharp contrast to the nuclear stations which caused incalculable damage to the country. It is no surprise that six 2-megawatt turbines, off the Fukushima coast have been built. After the evaluation phase is complete in 2016, “Japan plans to build as many as 80 floating wind turbines off Fukushima by 2020.”

In 2013, a floating offshore wind turbine was tested about 1 km off the coast of the island of Kabajima in Nagasaki Prefecture. It was a part of a Japanese government test project. Continuous exploration and research in this field is sure to keep yielding results to build up the wind power industry of Japan.

c. Hydroelectric Power in Japan:

The country’s main renewable energy source is hydroelectricity, with an installed capacity of about 27 GW and a production of 69.2 TWh of electricity in 2009. As of September 2011, Japan had 1,198 small hydropower plants with a total capacity of 3,225 MW. The smaller plants ed for 6.6 percent of Japan’s total hydropower capacity. The remaining capacity was filled by large and medium hydropower stations, typically sited at large dams.

Japan is a pioneer of “micro-hydro” whose output is less than 100 KW. The other classes are: large hydropower (generating more than 100 megawatts of electricity), small hydropower (up to 10 mW) and mini hydropower (around 1 mW, milliwatt or one thousandth of a watt). Such plants find application in rice growing and agriculture in general. In Japanese, the expression “chisan chissho” means “local production, local consumption.” Small scale hydroelectric plants in Japan are looked at positively by the Government as well as by communities. “Large” hydropower plants are defined by the Environment Ministry as those that generate more than 100,000 kW. “Medium” hydro plants generate between 10,000 kW and 100,000 kW. “Small” hydro plants are defined as those that generate between 1,000 kW and 10,000 kW. “Mini” hydro plants generate between 100 kW and 1,000 kW, and “micro” hydro plants are those that generate less than 100 kW. Whatever the scale, hydropower in general tends to be viewed more favorably by officialdom and the utilities, less because of its green credentials and more because it’s seen as a stable source of electricity in a mountainous nation with more than its fair share of precipitation. Small hydropower’s advantage, though, is that it does not mean damming up large rivers, but rather harnessing the power of flowing water — regardless of whether it’s a natural river, stream, or man-made agricultural canal or public reservoir.

d. Geothermal Power in Japan:

Japan has favorable sites for geothermal power because of its proximity to the Izu-Bonin-Mariana Arc. The Izu-Bonin-Mariana (IBM) arc system is a tectonilate convergent boundary. IBM extends over 2,800 km south from Tokyo, Japan, to beyond Guam, and includes the Izu islands Bonin Islands, and Mariana Islands; much more of the IBM arc system is submerged below sea level.

In 2007, Japan had 535.2 MW of installed electric generating capacity, about 5% of the world total. Geothermal power plays a minor role in the energy sector in the country: in 2013 it supplied 2,596 GWh of electricity, representing about 0.25% of the country’s total electricity supply.

Development of new geothermal power stations was essentially mothballed since the mid-1990s, mainly due to the strong resistance from local communities. Most of the potential sites are located in government-protected areas and in tourist destinations, thanks to the presence of traditional hot springs or onsen (an onsen is a term for hot springs in the Japanese language, though the term is often used to describe the bathing facilities and inns around the hot springs. As a volcanically active country, Japan has thousands of onsen scattered along its length and breadth. Onsen were traditionally used as public bathing places and today play a central role in directing Japanese domestic tourism.). Local communities in these areas are often dependent on revenue from tourists visiting onsen, and are opposed to geothermal developments because of the negative impact that the industry may have on the scenery and the resulting damage to the tourism industry and the local economy. However, interest in geothermal energy has been increasing in recent years due to the Japanese energy crisis following the Fukushima disaster and the subsequent closure of most of the country’s nuclear power stations. Businesses and the government are currently considering over 60 possible sites for new geothermal power development. Estimates put the total capacity potential of geothermal power at 23 GW, the third largest amount in the world after the United States and

Indonesia. An estimation suggests that about 1,500 hot water wells and springs could generate as much as 723 MWe without additional drillings.

Japan has developed advanced technologies for the exploration, development, utilization and monitoring of geothermal resources. Due to the stagnant domestic geothermal sector, most of the technologies have been used in overseas development in recent years. Japan provided about 67% of all the turbines used in geothermal power stations in the world in the last 10 years.

e. Biofuels Power in Japan:

By 2020, Japan targets its power generation from renewable sources to increase by 50 percent, and Biomass power is expected to see a fivefold increase over the same period. The country’s renewal of its renewable energy feed-in-tariff (FIT) scheme in July 2012, has prompted increased biomass throughputs and encouraged Japanese utilities to buy renewable electricity from wider areas, such as the industrial sector. As of September 2013, Japan had over 200 generators attached to municipal waste units and 70 independent plants using biomass fuel to produce energy. In addition, more than 18 more powerful generators were used to burn both coal and biomass fuel. In 2013, Japan produced nearly half a billion metric tons of biomass fuel and converted 80% of it into energy. The biofuel industrial sector in Japan is growing at some twenty percent a year.

By 2020, Japan targets its power generation from renewable sources to increase by 50 percent, and Biomass power is expected to see a fivefold increase over the same period. The country’s renewal of its renewable energy feed-in-tariff (FIT) scheme in July 2012, has prompted increased biomass throughputs and encouraged Japanese utilities to buy renewable electricity from wider areas, such as the industrial sector. As of September 2013, Japan had over 200 generators attached to municipal waste units and 70 independent plants using biomass fuel to produce energy. In addition, more than 18 more powerful generators were used to burn both coal and biomass fuel. In 2013, Japan produced nearly half a billion metric tons of biomass fuel and converted 80% of it into energy. The biofuel industrial sector in Japan is growing at some twenty percent a year.

f. Ocean Power in Japan:

In 2012, the government announced plans to build experimental tidal power and wave power plants in coastal areas. Construction on the projects is now about to start. As an island nation, Japan controls large swaths of ocean territory, six fold the area of the country, according to government data. That is in stark contrast to its relatively meagre land area (377,944 km²), which ranks near the middle of the world’s countries list, in sixtieth place. So it makes sense for Japan to look to the seas for renewable energy — something it is now doing. The maritime environment of Japan is different from that of Europe and technologies which may be suitable off the shores of Scotland or California may not necessarily be adaptable to the sea currents of Japan. The government is teaming up with two major industrial conglomerates, IHI Corp. and Toshiba Corp., to start field testing marine power generation in the very near future. “Our goal is to enable large-scale marine energy farms,” said a Toshiba spokeswoman in February 2015, noting that the nearest site for testing is the area off Japan’s southern Pacific coast, where the Kuroshio current flows northward.

The initiative is an effort to develop new technologies to harness renewable energy and nurture future business opportunities as the need for renewable energy grows world-wide amid stricter regulations on coal in the U.S. and Western Europe. The Japanese government’s energy plan put forward in April 2014 called for an increase in use of renewable energy “to the greatest extent possible.”

IHI and Toshiba will spend about two years collecting data on currents at various locations to select the most promising ones. They will then conduct field tests by setting up a power generation system similar to an underwater kite anchored to the ocean floor that “flies” in the current. The budget for the program is ¥2.75 billion ($23 million) for the current fiscal year through March. The government will subsidize part of the costs, but doesn’t disclose how much. Marine current power generation technologies have already been developed and used in Europe,

although they aren’t widespread. Japan wants to create its own technologies, say officials with the government-financed New Energy and Industrial Technology Development Organization, or NEDO, which works with the private sector on new energy technologies, and chose the two companies for financial .

G. BRAZIL:

Renewable energy in Brazil ed for close to ninety per cent of the domestically produced electricity used in Brazil, according to data from the 2015 National Energy Balance, conducted by the Energy Research Corporation (EPE). After the oil shocks of the 1970’s, Brazil started focusing on developing alternative sources of energy, mainly sugarcane ethanol. Its large sugarcane farms helped. Already in 1985, 91% of cars produced that year ran on sugarcane ethanol. The success of flexible-fuel vehicles, introduced in 2003, together with the mandatory E25 (25% ethanol, 75% gasoline) blend throughout the country, have allowed ethanol fuel consumption in the country to achieve a 50% market share of the gasoline-powered fleet by February 2008.

Brazil held its first wind-only energy contract bidding as far back as 2009, in a move to diversify its energy portfolio. Foreign companies struggled to take part. Early this century, a drought in Brazil that cut water to the country’s hydroelectric dams prompted severe energy shortages. The crisis, which ravaged the country’s economy and led to electricity rationing, underscored Brazil’s pressing need to diversify away from water power, and adopt other sources of renewable energy. The Brazilian Government has tendered out bids in 2015 for the construction of two gigawatts of wind production with an investment of $6 billion. The construction of 53 new solar and wind farms has also been approved by the Brazilian government in a clean energy push that will add around 1.5 GW of renewable power capacity to the nation’s energy mix over the next few years. Thwarted for more than a decade by a weak and unreliable power system – one that has been bedeviled by below-average rains depleting its hydropower resources – and embroiled in an ongoing economic crisis, Brazil’s government appears to be turning favorably towards solar and wind power to solve its energy crisis.

Contracts have been granted to clean energy developers to add 929.3 MW of solar PV capacity between 2015 and November 2018, with 548.2 MW of wind

power also in the offing. Early estimations by the government reveal that companies involved in this clean power push will have to find investment of 6.8 billion reals ($1.77 billion). Solar power in Brazil could offer electricity rates at the equivalent of eight cents per kilowatt hour. This latest tender has lowered the price for solar once more, and opens up further investment opportunities in this renewable sector. There is now close to 3 GW of solar PV capacity either installed or in the Brazilian pipeline. Brazil is on its path to meet clean power goal to install 7 GW of solar PV capacity by 2024.

Presently, it is estimated that as a result of Government initiatives to overcome the electricity shortages resulting from the draught around fifteen years ago, Brazil only counts on hydroelectricity for some seventy five percent of its electricity, down from nearly eighty percent at the advent of the twenty first century. In absolute numbers, in relation to hydroelectricity production Brazil is only behind China. The most recent data published by the Brazilian government states that nearly 12% of all the hydroelectricity in the world is produced in Brazil. Yet authorities are pushing a number of renewable energy sources including solar power, biomass and wind as primary alternatives. Wind energy’s greatest potential in Brazil is precisely during the dry season, so it is considered a hedge against low rainfall and the geographical spread of existing hydro resources. Brazil’s technical potential for wind energy is 143 gigawatts due to the country’s blustery 4,600-mile coastline, where most projects are based. The Brazilian Wind Energy Association and the government have set a goal of achieving 20 gigawatts of wind energy capacity by 2020 from the current 5 gigawatts (2014). The industry hopes the initiative will help kick-start the windenergy sector, which already s for 70% of the total in all of Latin America.

Despite being the world’s tenth largest consumer of energy, Brazil is an example as to what can be achieved with clean, renewable energy sources on a global scale; it is a world leader in pioneering new biofuel technologies.

Renewable energy in Brazil is a world-leading example of what can be achieved

in the sector at a practical level. Today, ethanol derived from sugar cane is an important source of energy in Brazil for running hybrid vehicles – usually vehicles that can use both petrol and ethanol. The nation is proud to have the world’s first sustainable biofuels economy.

a. Hydroelectric Power in Brazil:

Brazil is the second-largest producer of hydroelectric power in the world, trailing only China, and the country depends on hydroelectricity for more than 75% of its electric power supply. Much of Brazil’s hydroelectric potential lies in the country’s Amazon River basin in the north, while Brazil’s population centers (and demand for electricity) are largely along the eastern coast, particularly in the southern portion. This reliance on one resource for most of the country’s electricity generation, combined with the distant and disparate locations of its population centers, has presented electricity reliability challenges.

Brazil is still currently reeling from its worst drought in 40 years that started some fifteen years ago, and has contributed to electricity blackouts in many Brazilian regions. As Brazil hosted the 2014 World Cup soccer tournament, some blackouts resulted in the cancellation of some matches. Brazil has spent more than $USD 5 billion to subsidize electric utilities replacing lost hydroelectric generation with fossil fuel-fired generation, including large amounts of liquefied natural gas, and has taken steps to provide backup generation for stadiums. Brazil’s large geographic size has required substantial investments in electricity transmission lines and facilities. To future economic growth, Brazil has invested in additional hydroelectric facilities. For instance, the 14,000-megawatt Belo Monte dam along the Xingu River, expected to be completed in 2016, will become the second-largest dam in Brazil —and the third-largest dam in the world—at a projected cost of $USD 13 billion.

i. The Itaipu Dam:

The dam is the second largest operating hydroelectric facility in the world in of annual energy generation, generating 98.6 TWh in 2013 and 87.8 TWh in 2014, while the annual energy generation of the largest operating hydroelectric facility, the Three Gorges Dam in China, was 83.7 TWh in 2013 and 98.8 TWh in 2014. It is a binational undertaking run by Brazil and Paraguay at the Paraná River on the border section between the two countries, 15 km (9.3 mi) north of the Friendship Bridge. The installed generation capacity of the plant is 14 GW, with 20 generating units providing 700 MW each with a hydraulic design head of 118 meters (387 ft). In 2013 the plant generated a record 98.6 TWh, supplying approximately 75% of the electricity consumed by Paraguay and 17% of that consumed by Brazil.

b. Solar Power in Brazil:

The total installed solar power in Brazil was estimated to be 17 MWp (megawatt peak, a measuring unit for the maximum output of a photovoltaic power) at the end of 2012 and generates less than 0.01 percent of the country’s electricity demand. Changes to net metering rules for small-scale solar were announced in November 2015 although there were only 1,300 grid-connected systems at that time. Brazil expects to have 1.2 million systems in the year 2024. Brazil has one of the highest solar incidence in the world, ranging from 4.25 to 6.5 sun hours/day. Brazil has extremely favorable conditions for the production of energy through photovoltaic systems. Particularly in the Northeast and Midwest of the country, where we can observe a large and constant incidence of solar radiation throughout the year. Brazil, however, occupies only the 10th place in the ranking of countries that most use solar energy (behind China, Austria, India, Turkey, , United States and Australia). Brazil has around 193 million inhabitants, of whom about 105 million belong to the middle class and approximately 1 million belonging to the so called upper class. It is, when referring to its area, the fifth largest country and the fourth biggest in of production in the world. The economic growth in 2010 has reached about approximately 6%, while the rate of inflation was estimated at approximately 5% that year. Until today, Brazil produces only about one percent of energy originated from solar or wind systems. The reason for that was the political goals outlined in the 70’s, that consequently led to large-scale investments in the construction of hydroelectric power plants and dams. Thus, Brazil still relies on the hydroelectric systems to produce the biggest part of its energy. In Brazil there are about 200 companies working with solar energy - both water heating systems and photovoltaic modules - about 80% of them are micro and small enterprises and they are mostly concentrated in the south and southeast of the country. The photovoltaic solar cells themselves are imported and very expensive in Brazil. So far there are about 1 million systems installed and with the technology for the use of the solar energy in public, industrial and residential sectors. From that number, 66% are systems used in homes for heating water, and 17% were installed with the purpose of heating swimming pools. One square meter of sunlight can generate approximately 3kW/hour per day, which means the generation of 80kW per month. A family group with four in Brazil

requires 2 square meters of solar s to produce enough energy for their needs of hot water consumption. On average, the costs of such a system for this family group used as an example would be approximately around 450/550 euros. Through savings after the installation of such a system, the money invested is recovered after 12 months. The photovoltaic cells are not yet produced in Brazil. The Brazilian government began to the use of solar energy systems. By the end of 2010 about 40,000 new homes were built in south, southeast and midwest of the country, already with the water heating system made from solar energy. A group of researchers at the University of Santa Catarina and some public institutions emphasize that “Brazil demonstrates a vast capacity to bear the costs of a program for the introduction of energy produced with photovoltaic cells. Brazil has an excellent level of sunlight incidence.” This group is preparing proposals for the government in order to implement and promote programs for the use of solar energy, taking as inspiration the current German model. There is a bill in the Senate that proposes the reduction of import taxes for companies that operate in the field of solar cells, modules and products related to the necessary apparatus for the utilization of this source of energy. The chances that this project, wholly or with some alterations, could be soon approved are extremely high. Currently, these taxes are in the range of 12%. An inverter (converter) to 8 KW imported from the United States, that costs US$ 5,000, is sold in Brazil for $ 11,800. Researchers at the University of Santa Catarina have predicted that in 2013 the KW per hour of conventional forms of energy supply and those from solar photovoltaic cells in the Northeast (excluding grants) will be equivalent. The preparation and hosting of the 2016 Olympic Games in Brazil is a huge opportunity for companies working in the field of solar energy. It should also be a “Green Cup” as it was in 2006 in . Stadiums, hotels and other buildings shall be built in an intelligent manner and also concerned with the environment, including the use of photovoltaic cells. As an example, there are several programs for the promotion of German and European companies in general, whose overseas investments are relevant to the developing countries (BMZ and KfW) and the Brazilian side (Ministry of Mines and Energy) is available to companies seeking to bring electricity to the interior of the country ( Program for promotion, access and use of electricity for all Brazilians).

c. Wind Power in Brazil:

Wind energy is the fastest growing source of power generation in Brazil. Over the next few years, wind energy will contribute to the generation of more than 19,000 jobs, R$ 6 billion (1 Brazilian Real equals 0.27 US Dollar) in investments, 2.7 million homes supplied and 1.3 million tons of CO2 avoided. In 2015, 113 new wind farms are under construction with a total capacity of 2.7 GW. Wind power in Brazil amounts to an installed capacity of 5 GW in mid2014. Potential of wind in Brazil is more intense from June to December, coinciding with the months of lower rainfall intensity. This puts the wind as a potential supplementary source of energy generated by hydroelectric power. In fact, wind power has seen the highest expansion rate of all available renewable energy sources, with an average growth of 27% per year since 1990, according to the Global Wind Energy Council (GWEC).

d. Ethanol Fuel in Brazil:

Brazil is the world’s second largest producer of ethanol fuel. Together, Brazil and the United States lead the industrial production of ethanol fuel in 2014, ing together for 83.4 percent of the world’s production. In 2014 Brazil produced 23.4 billion liters (6.19 billion U.S. liquid gallons), representing 25.2 percent of the world’s total ethanol used as fuel.

Brazil is considered to have the world’s first sustainable biofuels economy and the biofuel industry leader, a policy model for other countries; and its sugarcane ethanol “the most successful alternative fuel to date.” However, some authors consider that the successful Brazilian ethanol model is sustainable only in Brazil due to its advanced agro-industrial technology and its enormous amount of arable land available; while according to other authors it is a solution only for some countries in the tropical zone of Latin America, the Caribbean, and Africa.

Brazil’s 40-year-old ethanol fuel program is based on the most efficient agricultural technology for sugarcane cultivation in the world, uses modern equipment and cheap sugar cane as feedstock, the residual cane-waste (bagasse) is used to produce heat and power, which results in a very competitive price and also in a high energy balance (output energy/input energy). In 2010, the U.S. EPA designated Brazilian sugarcane ethanol as an advanced biofuel due to its 61% reduction of total life cycle greenhouse gas emissions. There are no longer any light vehicles in Brazil running on pure gasoline. Since 1976 the government made it mandatory to blend anhydrous ethanol with gasoline, fluctuating between 10% to 22% and requiring just a minor adjustment on regular gasoline engines. In 1993 the mandatory blend was fixed by law at 22% anhydrous ethanol (E22) by volume in the entire country, but with leeway to the Executive to set different percentages of ethanol within pre-established boundaries. In 2003 these limits were set at a minimum of 20% and a maximum of 25%. Since July 1st, 2007 the mandatory blend is 25% of anhydrous ethanol and 75% gasoline or E25 blend. The lower limit was reduced to 18% in April 2011 due to recurring

ethanol supply shortages and high prices that take place between harvest seasons. By mid-March 2015 the government raised temporarily the ethanol blend in regular gasoline from 25% to 27%.

The Brazilian car manufacturing industry developed flexible-fuel vehicles that can run on any proportion of gasoline (E20-E25 blend) and hydrous ethanol (E100) introduced in the market in 2003. Flex vehicles became a commercial success, dominating the enger vehicle market with a 94% market share of all new cars and light vehicles sold in 2013. By mid-2010 there were 70 flex models available in the market, and as of December 2013, a total of 15 car manufacturers produce flex-fuel engines, dominating all light vehicle segments except sports cars, off-road vehicles and minivans. The cumulative production of flex-fuel cars and light commercial vehicles reached the milestone of 10 million vehicles in March 2010, and the 20 million-unit milestone was reached in June 2013. As of June 2015, flex-fuel light-duty vehicle cumulative sales totaled 25.5 million units, and production of flex motorcycles totaled 4 million in March 2015. The success of “flex” vehicles, together with the mandatory E25 blend throughout the country, allowed ethanol fuel consumption in the country to achieve a 50% market share of the gasoline-powered fleet in February 2008. In of energy equivalent, sugarcane ethanol represented 17.6% of the country’s total energy consumption by the transport sector in 2008.

i. The Ethanol Crisis in Brazil in 2010:

Since 2009 the Brazilian ethanol industry has experienced a crisis due to multiple causes. They include the economic crisis of 2008; poor sugarcane harvests due to unfavorable weather; high sugar prices in the world market that made more attractive to produce sugar rather than ethanol; and a freeze imposed by the Brazilian government on the petrol and diesel prices. Brazilian ethanol fuel production in 2011 was 21.1 billion liters (5.6 billion U.S. liquid gallons), down from 26.2 billion liters (6.9 billion gallons) in 2010, while in 2012 the production of ethanol was 26% lower than in 2008. By 2012 a total of 41 ethanol plants out of about 400 have closed and the sugar-cane crop yields dropped from 115 tons per hectare in 2008 to 69 tons per hectare in 2012.

A supply shortage took place for several months during 2010 and 2011, and prices climbed to the point that ethanol fuel was no longer attractive for owners of flex-fuel vehicles; the government reduced the minimum ethanol blend in gasoline to reduce demand and keep ethanol fuel prices from rising further; and for the first time since the 1990s, (corn) ethanol fuel was imported from the United States. The imports totaled around 1.5 billion liters in 2011–2012. The ethanol share in the transport fuel market decreased from 55% in 2008 to 35% in 2012. As a result of higher ethanol prices combined with government subsidies to keep gasoline price lower than the international market value, by November 2013 only 23% flex-fuel car owners were using ethanol regularly, down from 66% in 2009. During 2014 Brazil produced 23.4 billion liters (6.19 billion U.S. liquid gallons) of ethanol fuel, however, during that year Brazil imported ethanol from the United States, ranking as the second largest U.S. export market in 2014 after Canada, and representing about 13% of total American exports.

e. Hydrogen Power in Brazil:

The Center of Management and Strategic Studies under the supervision of the Brazilian Ministry of Science and Technology has published a document titled: Energetic Hydrogen in Brazil: funding for competitive politics 2010–2025. It gives numbers of a hydrogen scenario in the country related to its research, technologies and funding. The document reports Brazil as a leader in Latin America but yet with an investment in hydrogen technologies of only 3 to 5% of Japan, European Union, or the United States. National hydrogen production is about 920,000 t (10.2 billion cubic meters) per year with only 1% used as a direct fuel and the other 99% for refining, petrochemical, fertilizers and methanol.

f. Biomass Energy in Brazil:

Brazil’s biomass power production has increased 15% year-on-year to 1,860 average megawatts (MW average) in the first half of 2015, says Brazil’s Power Trading Chamber (CCEE). Installed biomass power capacity hit 10,793MW in June 2015, totaling at about 7.7% of the total power generation in Brazil for the period, a 9.4% expansion over the same period last year. The state of Sao Paulo was the top biomass power producer with 840.93MWa and 5,056MW of installed biomass capacity, followed by Mato Grosso do Sul. Biomass is a clean energy source used in Brazil. It reduces environmental pollution as it uses organic garbage, agricultural remains, wood shaving or vegetable oil. Refuse cane, with its high energetic value, has been used to produce electricity. More than 1 million people in the country work in the production of Biomass, and this energy represents 27% of Brazil’s energetic matrix.

The recent interest in converting biomass to electricity comes not only from its potential as a low-cost, indigenous supply of power, but for its potential environmental and developmental benefits. For example, biomass may be a globally important mitigation option to reduce the rate of CO2 buildup by sequestering carbon and by displacing fossil fuels. Renewable grown biomass contributes only a very small amount of carbon to the atmosphere. Locally, plantations can lessen soil erosion, provide a means to restore degraded lands, offset emissions and local impacts from fossil-fired power generation, and, perhaps, reduce demands on existing forests. In addition to the direct power and environmental benefits, biomass energy systems offer numerous other benefits, especially for developing countries, such as Brazil. Some of these benefits include the employment of underutilized labor and the production of co-products and by-products, for example, fuelwood.

Nearly all of the experience with biomass for power generation is based on the use of waste and residue fuels (primarily wood/wood wastes and agricultural residues). The production of electric power from plantation grown wood is an

emerging technology with considerable promise. However, actual commercial use of plantation-grown fuels for power generation is limited to a few isolated experiences. Wood from plantations is not an inexpensive energy feedstock, and as long as worldwide prices of coal, oil and gas are relatively low, the establishment of plantations dedicated to supplying electric power or other higher forms of energy will occur only where financial subsidies or incentives exist or where other sources of energy are not available. The biomass plantations are supplying energy on a commercial basis, such as in Brazil, the Philippines and Sweden, it can be shown that a combination of government policies and/or high conventional energy prices have stimulated the use of short-rotation plantations for energy. Brazil used tax incentives beginning in the mid-1960s to initiate a reforestation program to provide for industrial wood energy and wood product needs. As a consequence of the Brazilian Forestry Code with its favorable tax incentives, the planted forest area in Brazil increased from 470,000 hectares to 6.5 million hectares by 1993. With the discontinuation of the tax incentives in 1988, plantation establishment in Brazil has slowed although the commercial feasibility of using eucalyptus for energy and other products has been clearly demonstrated.

3

Tomorrow’s Car Today

The fiercest competition for tomorrow’s car may very well include the perennially improved conventional internal combustion engine (ICE) vehicle of today. Today’s ICE runs increasingly on ethanol blended with gasoline on engines that are ever more efficient and less polluting, which gives a tough run for the money to manufacturers of compressed natural gas (CNG) vehicles and electric vehicles (EV). We are looking at a hybrid fleet for the morrow that is nascent now and will continue to grow and prosper and whose composition will vary from one region –within countries- to another across demographical factors, age groups and income brackets. It is unlikely any of the vehicle types (ICE, EV, or CNG) will make the other extinct; rather the successful and fruitful research and development in one type of vehicle will invite improvements in the other in energy efficiency, energy density, ecological impact, cost, convenience, safety, design and perhaps other areas as well.

Let us that the fleet of vehicles is turning hybrid with flexible fuel vehicle models claiming a strong presence. A hybrid electric vehicle combines a conventional (usually fossil fuel-powered) powertrain with some form of electric propulsion. As of July 2015, over 10 million hybrid electric vehicles have been sold worldwide since their inception in 1997, led by Toyota Motor Company (TMC) with over 8 million Lexus and Toyota hybrids sold as of July 2015; followed by Honda Motor Co., Ltd. with cumulative global sales of more than 1.35 million hybrids as of June 2014. Just about every OEM is steadily rolling out its flexible fuel model.

i. The Electric Vehicle:

An electric vehicle (EV), also referred to as an electric drive vehicle, uses one or more electric motors or traction motors for propulsion. An electric vehicle may be powered through a collector system by electricity from off-vehicle sources, or may be self-contained with a battery or generator to convert fuel to electricity. EV’s include road and rail vehicles, surface and underwater vessels, electric aircraft and electric spacecraft. EV’s first came into existence in the mid-19th century, when electricity was among the preferred methods for motor vehicle propulsion, providing a level of comfort and ease of operation that could not be achieved by the gasoline cars of the time. For a while it seemed the electric motor would be adopted in preference to the ICE, but issues of range anxiety must have prevailed. The internal combustion engine (ICE) has been the dominant propulsion method for motor vehicles for almost 100 years, but electric power has remained commonplace in other vehicle types, such as trains and smaller vehicles.

At the beginning of the 21st century, interest in electric and other alternative fuel vehicles has increased due to growing concern over the problems associated with hydrocarbon-fueled vehicles, including damage to the environment caused by their emissions, and the sustainability of the current hydrocarbon-based transportation infrastructure as well as improvements in electric vehicle technology. The unstable price of crude oil over the last decade has had a drastic impact on the cost of miles traveled in conventional cars and has expectedly revived significant and rewarding research into alternatives to ICE by original equipment manufacturers (OEM) as well as by pioneering entrepreneurs and private companies.

There is a number of factors that are helping to usher in an era of transportation that is environment conscious. There is an overwhelming and irreversible commitment to reduce harmful emissions which include carbon dioxide (CO2), carbon monoxide (CO), mono-nitrogen oxides NO and NO2, particulates which

are referred to as particle pollution (PP), a complex mixture of extremely small particles and liquid droplets. Particle pollution is made up of a number of components, including acids (such as nitrates and sulfates), organic chemicals, metals, and soil or dust particles.

The picture below depicts filling stations for electric vehicles throughout the USA, and this is spurring an infrastructure construction activity that is healthy for the economy. We have to keep in mind that five years ago there was almost no EV filling stations in the USA. Norway is the country with the highest market penetration per capita in the world, with four plug-in electric vehicles per 1,000 inhabitants in 2013. In March 2014, Norway became the first country where over 1 in every 100 enger cars on the roads is a plug-in electric. Norway also has the world’s largest plug-in electric segment market share of total new car sales, 13.8% in 2014, up from 5.6% in 2013. As of May 2015, there were 58,989 plugin electric vehicles ed in Norway, consisting of 54,160 all-electric vehicles and 4,829 plug-in hybrids.

Looking back at the past five years we realize the exponential and unabated growth of the electric car. Even if at present its percentage market share is still minimal, its accelerated acceptance in the market compounded by the flexible fuel vehicles and the compressed natural gas vehicle success is sure to challenge the conventional ICE car.

Let us take knowledge of the fact that any vehicle can be equipped with an electric powertrain. There are several types of electric vehicles; we will shed light on road sedans –plug-in cars and hybrid cars- as they are the likeliest to cause an impact with consequences through the type of fuel needed. We must keep in mind that transportation can also include trains and airborne vehicles, off-road vehicles etc…

As can be seen from the graph below, China, the second largest economy in the world and the fastest growing has adopted the electric vehicle en masse, and its

demand for them is a source of economic vigor to this net importing dragon of a crude oil guzzler. Making electric vehicles that could very well operate eventually on homemade solar s is a double must as it will pull the economy out of its present polluting addiction spiral and into a virtuous circle of an ever more breathable air and home reliant industry. Chinese consumers are expected to purchase between 220,000 and 250,000 electric cars in 2015, making the country the world’s largest market for the vehicles.

The China Association of Automobile Manufacturers (CAAM), which announced the China sales data, says that US sales are expected to reach 180,000 this year, allowing China’s electric car market to overtake the US’s for the first time.

Sales of electric vehicles—specifically “battery electric vehicles” and “plug-in hybrid electric vehicles”—have almost tripled in China in 2015 as of the end of October, compared with a year earlier. US sales, on the other hand, have stagnated:

1. Plug-in electric vehicle:

A plug-in electric vehicle (PEV) is any motor vehicle that can be recharged from any external source of electricity, such as wall sockets, and the electricity stored in the rechargeable battery packs drives or contributes to drive the wheels. PEV is a subcategory of electric vehicles that includes all-electric or battery electric vehicles (BEVs), and electric vehicle conversions of hybrid electric vehicles and conventional internal combustion engine vehicles. By end of 2015, well over one million highway-capable plug-in electric enger cars and light utility vehicles will have been sold worldwide. The top selling plug-in electric cars are the Nissan Leaf, with global sales of 195,000 units by October 2015, followed by the Chevrolet Volt plug-in hybrid, which together with its sibling the Opel/Vauxhall Ampera has combined global sales of over 100,000 units by the end of October 2015. Ranking third is the all-electric Tesla Model S with over 90,000 units sold worldwide by October 2015.

2. Battery Electric Vehicle (BEV):

A battery electric vehicle (BEV) is a type of electric vehicle (EV) that uses chemical energy stored in rechargeable battery packs. BEV’s use electric motors and motor controllers.

One limitation to the sales of electric vehicles is the short service span of electric batteries which reduces the distances travelled and lead to range anxiety. This limitation is being overcome in part thanks to the serendipitous discoveries by Wang Changan of Tsinghua University, in Beijing, and Li Ju of the Massachusetts Institute of Technology as reported by The Economist in August 15th 2015 issue (Tiny Balls of Fire). Their work could very well quadruple the lifespan of lithium electric batteries. Their method was to soak the particles in a mixture of sulphuric acid and titanium oxysulphate. This replaces the aluminum oxide with titanium oxide, which is more conductive. However, they accidentally left one batch of particles in the acidic mixture for several hours longer than they meant to. As a result, though shells of titanium dioxide did form on them as expected, acid had time to leak through these shells and dissolve away some of the aluminum within. The consequence was nanoparticles that consisted of a titanium dioxide outer layer surrounding a loose kernel of aluminum. Many people would, at this point, have thrown the peculiar batch away. Dr.Wang and Dr.Li, however, realized they might have something valuable on their hands.

a. Who Tried to Abort The Electric Car?

Before its recent irreversible success, the electric car did have a promising yet short success in the early 1990’s that saw genuine enthusiasm from thousands of citizens –primarily in the USA where the electric car was conceived and builtbelieving the age of pollution could finally yield the way to an immaculate means of transportation, noiseless and innocent of any ecological harm. These hopes were dashed when General Motors (GM), who had invented that early electric car model decided to euthanize its initiative, much to the disillusion of many.

The insistence of General Motors to proceed with its decision to recuperate and crush the cars it had successfully leased to satisfied customers fueled askance on the part of the public as to the motivation behind GM’s decision. Had it yielded to the interests of powerful oil companies who saw 70% of their crude oil barrel become useless? Was GM’s decision the proxy assassination of a new born future player in a nascent world energy order that would inconvenience and challenge the rule of behemoth crude oil producers? Such justifiable suspicion led to the making of a documentary movie that convinced many that there could be collusion between influential industries that place their short term financial gains above all and would remove obstacles to satisfy their greed by any means possible.

Who Killed the Electric Car? is a 2006 documentary film that explores the creation, limited commercialization, and subsequent destruction of the battery electric vehicle in the United States, specifically the General Motors EV1 of the mid-1990s. The film explores the roles of automobile manufacturers, the oil industry, the U.S. government, the California government, batteries, hydrogen vehicles, and consumers in limiting the development and adoption of this technology.

1. Topics Addressed

The film deals with the history of the electric car, its modern development, and commercialization. The film focuses primarily on the General Motors EV1, which was made available for lease mainly in Southern California, after the California Air Resources Board (CARB) ed the Zero-emissions vehicle (ZEV) mandate in 1990 which required the seven major automobile suppliers in the United States to offer electric vehicles in order to continue sales of their gasoline powered vehicles in California. Nearly 5,000 electric cars were designed and manufactured by GM, Toyota, Honda, Ford, Nissan, and Chrysler; and then later destroyed or donated to museums and educational institutions. Also discussed are the implications of the events depicted for air pollution, oil dependency, Middle East politics, and global warming.

The film details the California Air Resources Board’s reversal of the mandate after relentless pressure and suits from automobile manufacturers, continual pressure from the oil industry, orchestrated hype over a future hydrogen car, and finally the perfidy of the George W. Bush istration.

A portion of the film details GM’s efforts to demonstrate to California that there was no consumer demand for their product, and then to take back every EV1 and destroy them. A few were disabled and given to museums and universities, but almost all were found to have been crushed. GM never responded to the EV drivers’ offer to pay the residual lease value ($1.9 million was offered for the remaining 78 cars in Burbank before they were crushed). Several activists, were arrested in the protest that attempted to block the GM car carriers taking the remaining EV1s off to be crushed.

The film explores some of the motives that may have pushed the auto and oil industries to kill off the electric car. Wally Rippel offers, for example, that the oil

companies were afraid of losing their monopoly on transportation fuel over the coming decades; while the auto companies feared short term costs for EV development and long term revenue loss because EVs require little maintenance and no tune-ups. Others explained the killing differently. GM spokesman Dave Barthmuss argued it was lack of consumer interest due to the maximum range of 80–100 miles per charge, and the relatively high price.

2. The Suspects:

a. U.S. consumers:

While few American consumers ever heard of the electric cars in California, those who did were not necessarily critical mass for this new technology and the question as to whether a breakeven point could be reached by OEM from their purchases could be asked. Thanks to lower gas prices and infatuation with SUV’s, few people sought out this new technology. One could infer from the movie that there was insufficient awareness amongst the general population about the possibilities afforded by this new technology which still had some hurdles to overcome.

b. Batteries:

Recharge time and range anxiety due to battery performance limitations and costs were then (and still are today albeit to a lesser extent) a hurdle challenging the large scale adoption of the electric car by car buyers. Proponents of the electric vehicle argued that average distances travelled by driving citizens daily could be covered by the existing range, but this issue seemed like a restriction on the behavior of car owners and the battery issue was a bane for progress with the electric car. Battery making companies had been making quantum leap progress with their product, but it is alleged that they were infiltrated by powerful oil companies through proxies that halted their activities.

c. Oil Companies:

The oil industry, through its major lobby group the Western States Petroleum Association, is accused of financing campaigns to kill utility efforts to build public car charging stations. Through astroturfing (practice of masking the sponsors of a message or organization (e.g., political, advertising, religious or public relations) to make it appear as though it originates from and is ed by grassroots participant(s)). Groups like “Californians Against Utility Abuse” (CARB) posed as consumers instead of the industry interests they actually represented. Mobil and other oil companies are also shown to be advertising directly against electric cars in national publications. Mobil, like most oil companies, operate petrol stations that sell gasoline directly to customers and stand to lose from the success of the electric vehicle. At the end of the film Chevron is shown buying patents and controlling interest in Ovonics, the advanced battery company featured in the film ostensibly to prevent modern batteries from being used in non-hybrid electric cars. The documentary also refers to manipulation of oil prices by overseas suppliers in 1980s as an example of the industry working to kill competition and keep customers from moving toward alternatives to oil, though at the time very low crude oil prices were a powerful tool in a complex scheme that may have contributed to defeating the Soviet Union as the low price of crude oil hurt Russia’s main export, crude oil, which it was able to sell only in US dollars.

d. Original Equipment Manufacturers (OEM):

OEM’s stand to lose when zero maintenance is required as the case might be for electric vehicles. We can recall that in the 1950’s the proposals of Edward Deming for zero defects were turned down by the American car industry which had then –as it did perhaps through the 1990’s- the view that a car ought to be replaced a couple of years after purchase rather than resist decades of intensive and frequent driving.

e. U.S. Government:

While not overtly political, the film documents that the U.S. federal government under the George W. Bush istration ed the auto industry suit against California in 2002—pushing California to abandon its ZEV (zero emission vehicle) mandate regulation. The film notes that Bush’s chief of staff Andrew Card had recently been head of the American Automobile Manufacturers Alliance in California and then ed the White House with Dick Cheney, Condoleezza Rice, and other federal officials who were former executives or board of oil and auto companies. By failing to increase mileage standards in a meaningful way since the 1970’s and now interfering in California, the federal government had again served short-term industry interests at the expense of long-range leadership on issues of oil dependency and cleaner cars.

f. California Air Resources Board (CARB):

In 2003, the CARB, headed by Democrat Alan Lloyd, finally caved to industry pressure and drastically scaled back the ZEV mandate after defending the regulation for more than 12 years. While championing CARB’s efforts on behalf of California’s with its 1990 mandate (and other regulations over the years), the film suggests Lloyd may have had a conflict of interest as the director of the California Fuel Cell Partnership. The ZEV change allowed a marginal amount of hydrogen fuel cell cars to be produced in the future versus the immediate continued growth of its electric car requirement. Footage shot in the meetings showed Lloyd shutting down battery electric car proponents while giving the car makers all the time they wanted to make their points.

g. Hydrogen Fuel Cell:

The hydrogen fuel cell was presented by the film as an alternative that distracts attention from the real and immediate potential of electric vehicles to an unlikely future possibility embraced by auto makers, oil companies and a pro-business istration in order to buy time and profits for the status quo. The film corroborates the claim that hydrogen vehicles are a mere distraction by stating that “A fuel cell car powered by hydrogen made with electricity uses three to four times more energy than a car powered by batteries” and by interviewing the author of The Hype About Hydrogen, who lists five problems he sees with hydrogen vehicles: High cost, limits on driving range due to current materials, high costs of hydrogen fuel, the need for entirely new fueling compounds, and competition from other technologies in the marketplace, such as hybrids.

The price of Hydrogen has since come down to $4–6/kg (without carbon sequestering) due to reduction in the price of Natural Gas as a feedstock for steam reforming owing to the proliferation of hydraulic fracturing of shales. A kilo of Hydrogen has the same energy yield as a gallon of gasoline although production currently creates 12.5 kg CO2, 39% more than the 8.91 kg CO2 from a gasoline gallon.

h. General Motor’s Alibi

General Motors (GM) responded in a 2006 blog titled Who Ignored the Facts About the Electric Car? by Dave Barthmuss of GM’s communications department. In his June 15, 2006 (13 days before the film was released in the U.S.) blog he states not to have seen the movie, but believes “there may be some information that the movie did not tell its viewers.” He repeats GM’s claims that, “despite the substantial investment of money and the enthusiastic fervor of a relatively small number of EV1 drivers — including the filmmaker — the EV1 proved far from a viable commercial success”.

He submits it is “good news for electric car enthusiasts” that electric vehicle technology since the EV1 was still being used in two-mode hybrid, plug-in hybrid, and fuel cell vehicle programs.

Rechargeable batteries used in electric vehicles include lead-acid (“flooded”, Deep cycle, and VRLA), NiCd, nickel metal hydride, lithium ion, Li-ion polymer, and, less commonly, zinc-air and molten salt batteries. The amount of electricity (i.e. electric charge) stored in batteries is measured in ampere hours or in coulombs, with the total energy often measured in watt hours.

Rechargeable batteries are usually the most expensive component of BEVs, being about half the retail cost of the car. The cost of battery manufacture is substantial, but increasing returns to scale lower costs. Since the late 1990s, advances in battery technologies have been driven by demand for laptop computers and mobile phones, with consumer demand for more features, larger, brighter displays, and longer battery time driving research and development in the field. The BEV marketplace has reaped the benefits of these advances, but costs remain too high and, along with limited range, provide a key barrier to the use of rechargeable batteries in electric vehicles. We can however expect the cost

to continue to decline. The cost of electric vehicle batteries in 2015 has been reduced by 50% since 2008.

Rechargeable traction batteries are routinely used all day, and fast–charged all night. Forklifts, for instance, are usually discharged and recharged every 24 hours of the work week.

The predicted market for automobile traction batteries is expected to sur $US37 billion in 2020.

On an energy basis, the price of electricity to run an EV is a small fraction of the cost of liquid fuel needed to produce an equivalent amount of energy (energy efficiency). The cost of making and replacing the batteries dominates the operating costs.

Electric Cars use the energy stored in a battery (or series of batteries) for vehicle propulsion. Electric motors provide a clean and safe alternative to the internal combustion engine. There are many pros and cons about electric cars. The electric vehicle is known to have faster acceleration but shorter distance range than conventional engines. They produce no exhaust but still require long charging times, though this hurdle is being overcome.

b. The Electric Car is a Computer:

Software companies are giving a run for their money to traditional and conventional OEM’s as they score major successes in pioneering customized and personalized electric vehicles which offer features of intelligent interaction to engers. Electric vehicles operate by electronic command rather than mechanical gearing which opens up possibilities of remote control and selfdriving. The fundamental requirement of driving conventional vehicles has always been and for good reason “Hands on The Wheel Eyes on The Road”. When sensors and camera enabled computers guide self-driving and self-parking vehicles, driving time is saved, wealth is created and lives are enriched in a society. Time spent behind the wheel at full concentration operating a conventional ICE sedan can now be used by a parent to recite his homework to a child or work as they sit comfortably inside a self-driving electric car. The average global citizen spends two hours a day in a car which now can be spent more usefully and enjoyably.

Computer powered electric vehicles could contain personal information about people’s work schedules, family details, routes programmed etcetera…The security of electric vehicles will also be addressed through software firewalls rather than metallic locks.

It is no wonder that Japan, a country known for rewarding, using and pioneering the manufacturing of electronics has made significant inroads in upgrading its road infrastructure which now offers more recharge points for electric vehicles than it does conventional gasoline filling stations. The Japanese government has set up a target to deploy 2 million slow chargers and 5,000 additional fast charging points by 2020. The fleet of plug-in electric vehicles in Japan is the third largest in the world after the United States and China as of August 2015. Since 2009 over 121,000 plug-in electric vehicles have been sold in the country through August 2015. During 2012, global sales of pure electric cars were led by Japan with a 28% market share of total sales.

c. Benefits and Drawbacks of the Electric Car:

Benefits:

It is common to associate independence from fossil fuel as beneficial to one’s health and environment, and an electric car grants that independence. Whether it is also beneficial financially depends on the comparative cost of electricity generation and gasoline extraction. The cost of a mile travelled will depend on how much one kilowatt costs per mile versus the cost of a gallon of gasoline per mile.

The graph above shows under what cost conditions of KWh and gasoline cost per gallon a mile travelled will cost.

Electric cars are 100 percent eco-friendly as they run on electrically powered engines. It does not emit toxic gases or smoke in the environment as it runs on clean energy source. They are even better than hybrid cars as hybrids running on gas do produce some emissions.

EV’s are achieving greater acceptance and growing in popularity. Such acceptance encourages research and investment on the part of OEM’s whereby all new types of cars being put on the market that are each unique, providing purchasers with galore model choices moving forward.

Electric cars are at a much lesser risk of catching fire and exploding than conventional ICE cars while enjoying all common safety features.

The cost of purchase of an electric car is steadily going down as manufacturing approaches economies of scale and we are already at a point where several sedan models cost brand new in the vicinity of thirty thousand dollars which is within the reach of even the blue collar workforce.

A major reason for the rapid jump in EV sales is the rapid drop in the cost of their key component – batteries. Over the past five years, the cost of a lithium battery has been halved and improvements are still ongoing.

Electric cars run on electrically powered engines with no rotating machinery (except for the wheel’s axle) and hence there is no need for lubrication. Therefore, the maintenance cost of electric cars is comparatively low.

So much electric cars are noiseless that some opinion leaders have pointed out the drawbacks from utterly inaudible movement for pedestrians crossing the street, blind people and birds who would normally be alerted by the approaching purr of a conventional car’s engine. Electric motors are capable of providing smooth drive with higher acceleration over longer distances.

Statistically, electric cars are being proven safer on the road. 94% less accidents were reported after three million miles driven in the USA and those that occurred were found to be the result of human error. In the USA alone, the decrease in the number of accidents could result with a saving of 190 billion USD a year. When cars are less accident prone, they can be made of material 20% lighter. This means a saving on electric power of twelve percent.

Electric cars are being equipped with the option of being autonomous on the road and in parking. This can free drivers and engers to do more useful work

and spend more time with family. The self-parking option makes it possible to engers to leave the car to park itself in a smaller space thus freeing up an area estimated globally at 5.7 billion square meters which is quadruple the area of Los Angeles!

Drawbacks of an Electric Car:

The old adage of each rose having a thorn could perhaps meet with an exception in the case of an electric vehicle, but we will still point out some hurdles which are being fast overcome:

We saw above the image of increasing recharge points throughout the USA, and below throughout the United Kingdom. There is no doubt that the number of electrical recharge points is increasing fast throughout powerful economies even if more are needed as yet. This is a drawback that is fast being blurred by rapid and constant improvements in the infrastructure that will overcome the range anxiety.

Presently the range achieved by refill (or recharge) of an electric vehicle is sixty percent that achieved by a car that runs on gasoline. The disparity is fast disappearing though and it is perfectly fathomable that an electric car will soon outperform a conventional ICE car in range as well as refill time as well due to the serious research being carried out.

Until a few short years ago, electric cars on the road were pretty much limited to two seaters, but that is no longer the case. Successful minivans and sports utility vehicles are finding commercial acceptance by buyers.

ii. The Compressed Natural Gas Vehicle:

A natural gas vehicle (NGV) is an alternative fuel vehicle that uses compressed natural gas (CNG) or liquefied natural gas (LNG) as a cleaner alternative to other fossil fuels. Worldwide, there were 22.7 million natural gas vehicles by 2015, led by China with 4.44 million, Iran with 4 million, Pakistan (3.70 million), Argentina (2.48 million), India (1.80 million) and Brazil (1.78 million). The Asia-Pacific region leads the world with 6.8 million NGV’s, followed by Latin America with 4.2 million vehicles. In the Latin American region almost 90% of NGVs have bi-fuel engines, allowing these vehicles to run on either gasoline or CNG. In Pakistan, almost every vehicle converted to (or manufactured for) alternative fuel use typically retains the capability to run on ordinary gasoline.

Existing gasoline-powered vehicles may be converted to run on CNG or LNG, and can be dedicated (running only on natural gas) or bi-fuel (running on either gasoline or natural gas). Diesel engines for heavy trucks and busses can also be converted and can be dedicated with the addition of new heads containing spark ignition systems, or can be run on a blend of diesel and natural gas, with the primary fuel being natural gas and a small amount of diesel fuel being used as an ignition source. An increasing number of vehicles worldwide are being manufactured to run on CNG. In 2011, President Obama launched an initiative to promote the use of compressed natural gas in vehicles as yet another alternative to ICE cars. Infrastructure on the roads will be adapted to make it convenient for fleets of public and private transportation to refuel and tax incentives will be offered.

As of December 2014, the U.S. had a fleet of 274,190 compressed natural gas (CNG) vehicles. The NGV fleet is made up mostly of transit buses but there are also some government fleet cars and vans, as well as increasing number of corporate trucks replacing diesel versions, most notably Waste Management, Inc and UPS trucks.

a. Canada:

Despite being one of the richest countries in the world in natural gas, Canada has not succeeded in using natural gas on a large scale to fuel its fleet of vehicles. Natural gas as a vehicle fuel was introduced in the 1980’s in Canada but has not taken off on a large scale. This could be attributed to insufficient attention paid to it by the Government through appropriate tax incentives.

b. Mexico:

Mexico is a net importer of natural gas. There are signs of interest in adopting compressed natural gas as a vehicle fuel for publicly owned fleets and corporately owned fleets as well. The number of CNG vehicle is still modest numbering below 10,000 in 2015 in a country with over thirty million ed vehicles.

1. Europe:

a. :

hit the milestone of 900 CNG filling stations nationwide in December 2011. Gibgas, an independent consumer group, estimates that 21% of all CNG filling stations in the country offer a natural gas/bio-methane mix to varying ratios, and 38 stations offer pure bio-methane.

b. Ireland:

Ireland has introduced the use of CNG vehicles to public transportation despite the fact that it imports natural gas. Major fossil fuel finds in Ireland include the Kinsale Head gas field and Corrib gas field, but these have been mired in controversy over exploitation rights and have not been developed.

c. Italy:

Natural gas traction is quite popular in Italy, due to the existence of a capillary distribution network for industrial use since the late 50’s and a traditionally high retail price for petrol. As of April 2012 there were about 1,173 filling stations, mainly located in the northern regions, while the fleet reached 850,000 CNG vehicles at the end of 2013.

2. China:

China has an ambitious program likely to succeed to increase by six fold its present fleet of CNG vehicles by 2020. By that date, China’s CNG vehicles will number over twenty million; as many as there are today globally!

iii. The Flexible Fuel Vehicle:

A flexible-fuel vehicle (FFV) or dual-fuel vehicle (colloquially called a flex-fuel vehicle) is an alternative fuel vehicle with an internal combustion engine designed to run on more than one fuel, usually gasoline blended with either ethanol or methanol fuel, and both fuels are stored in the same common tank. Modern flex-fuel engines are capable of burning any proportion of the resulting blend in the combustion chamber as fuel injection and spark timing are adjusted automatically according to the actual blend detected by a fuel composition sensor. Flex-fuel vehicles are distinguished from bi-fuel vehicles, where two fuels are stored in separate tanks and the engine runs on one fuel at a time, for example, compressed natural gas (CNG), liquefied petroleum gas (LPG), or hydrogen.

The most common commercially available FFV in the world market is the ethanol flexible-fuel vehicle, with about 48 million automobiles, motorcycles and light duty trucks manufactured and sold worldwide by mid-2015, and concentrated in four markets: Brazil (29.5 million by mid-2015), the United States (17.4 million by the end of 2014), Canada (more than 600,000), and Europe, led by Sweden (243,100).

The Brazilian flex fuel fleet includes over 4 million flexible-fuel motorcycles produced since 2009 through March 2015. In addition to flex-fuel vehicles running with ethanol, in Europe and the US, mainly in California, there have been successful test programs with methanol flex-fuel vehicles, known as M85 flex-fuel vehicles.

a. FFV’s around the World:

1. Brazil:

Flexible-fuel technology started being developed by Brazilian engineers near the end of the 1990s. Brazilian flex cars are capable of running on just hydrated ethanol (E100), or just on a blend of gasoline with 20% to 25% anhydrous ethanol (the mandatory blend since 1993), or on any arbitrary combination of both fuels.

The flexibility of Brazilian FFV’s empowers the consumers to choose the fuel depending on current market prices. As ethanol fuel economy is lower than gasoline because of ethanol’s energy content is close to 34% less per unit volume than gasoline, flex cars running on ethanol get a lower mileage than when running on pure gasoline. However, this effect is partially offset by the usually lower price per liter of ethanol fuel. As a rule of thumb, Brazilian consumers are frequently advised by the media to use more alcohol than gasoline in their mix only when ethanol prices are 30% lower or more than gasoline, as ethanol price fluctuates heavily depending on the result of seasonal sugar cane harvests. The rapid success of flex vehicles was made possible by the existence of 33,000 filling stations with at least one ethanol pump available by 2006, a heritage of the early Pró-Álcool ethanol program.

This loophole might allow the car industry to meet the CAFE targets in fuel economy just by spending between US$100 and US$200 that it cost to turn a conventional vehicle into a flex-fuel, without investing in new technology to improve fuel economy, and saving them the potential fines for not achieving that standard in a given model year. The CAFE standards proposed in 2011 for the period 2017-2025 will allow flexible-fuel vehicles to receive extra credit but only when the carmakers present data proving how much E85 such vehicles have actually consumed. Inadequate infrastructure in several countries results in only a minor percentage of refueling stations being equipped with ethanol blended with gasoline (E85 or other). Dedicated tanks for ethanol at petrol stations cost around 60,000 USD each in 2015.

iv. The Hydrogen Vehicle:

A hydrogen vehicle is a vehicle that uses hydrogen as its onboard fuel for motive power. Hydrogen vehicles include hydrogen fueled space rockets, as well as automobiles and other transportation vehicles. The power plants of such vehicles convert the chemical energy of hydrogen to mechanical energy either by burning hydrogen in an internal combustion engine, or by reacting hydrogen with oxygen in a fuel cell to run electric motors. Widespread use of hydrogen for fueling transportation is a key element of a proposed hydrogen economy.

Hydrogen fuel does not occur naturally on Earth and thus is not an energy source; rather it is an energy carrier. As of 2014, 95% of hydrogen is made from methane. It can be produced using renewable sources, but that is an expensive process. Integrated wind-to-hydrogen (power to gas) plants, using electrolysis of water, are exploring technologies to deliver costs low enough, and quantities great enough, to compete with traditional energy sources.

Many companies are working to develop technologies that might efficiently exploit the potential of hydrogen energy for use in motor vehicles. As of November 2013 there are demonstration fleets of hydrogen fuel cell vehicles undergoing field testing including the Chevrolet Equinox Fuel Cell, Honda FCX Clarity, Hyundai ix35 FCEV and Mercedes-Benz B-Class F-Cell. The drawbacks of hydrogen use are high carbon emissions intensity when produced from natural gas, capital cost burden, low energy content per unit volume, low performance of fuel cell vehicles compared with gasoline vehicles, production and compression of hydrogen, and the large investment in infrastructure that would be required to fuel vehicles.

a. Skepticism over The Hydrogen Vehicle:

Critics claim the time frame for overcoming the technical and economic challenges to implementing wide-scale use of hydrogen cars is likely to last for at least several decades, and hydrogen vehicles may never become broadly available. Skeptics claim that the focus on the use of the hydrogen car is a dangerous detour from more readily available solutions to reducing the use of fossil fuels in vehicles. Several experts believe alternatives to fossil fuels and hydrogen run vehicles will make up the hybrid fleet in coming years.

In December of 2015, the West Texas Intermediate barrel of crude oil was selling at 39.97 USD/barrel while natural gas was trading 2.19 USD per million BTU.

If we extracted one million BTU from WTI crude oil it would cost us 7.20 USD (39.97/5.55=7.2). Whereas one million BTU from Henry Hub (The Henry Hub is a distribution hub on the natural gas pipeline system in Erath, Louisiana, owned by Sabine Pipe Line LLC, a subsidiary of Chevron Corporation) is listed at 2.19 USD on the same date (see graph below)! A price difference of 328%! One can imagine the downstream repercussions such a price difference can have on industries. These would have to adapt their machinery to accept natural gas instead of liquid crude oil derivatives.

As can be seen from the graph above, over the last few years the price of one million BTU from natural gas neared ten USD’s at Henry Hub, close to quintuple its level today. What caused it to go down is attributed to a quantum leap in technology; the success of the hydraulic fracturing (“fracking”) of shale (a kind of rock) which contains both gas and oil. Pioneered by George Mitchell (May 21st, 1919 – July 26th, 2013) who succeeded in commercializing it in 2008, some forty years after he had first tried. This technology, still an apanage to the USA, made it possible to extract one million BTU’s from natural gas

entrapped in shale rock at record low prices.

Natural gas contains mostly methane (85-90%), ethane (10-15%) and butane, propane etc…When used as a fuel in industry, home heating or transportation, natural gas pollutes much less than crude oil derivatives. The components of natural gas are each a precursor to a range of value added industries.

The main factors influencing the price of crude oil and, separately the prices of natural gas can be summarized as TELP (Technology, Economy, Legislation, Politics).

a. The TELP Factors:

1. Technology:

Technology’s influence on crude oil price is taking place along several axis. Advances in fracking have made this technology flourish and has availed both natural gas and crude oil. Simultaneously, conventional gasoline engines are now more efficient therefore requiring less fuel. Yet along the lines of technological advances and innovation, alternative fuel vehicles (renewables, electric cars, hybrids, flex-fuel cars, CNG cars etc…) are fast dissipating the demand for crude oil derivatives.

a. Crude Oil:

As we attempt to analyze what influences the price of crude oil, let us find out what a barrel of crude oil is used for in the first place. As we can see from the snapshot below seventy percent is for transportation (gasoline 47%+diesel 23%). Technology on conventional gasoline cars is making internal combustion engines more efficient which means they can increasingly deliver more mileage with less gasoline. Furthermore, we elaborated earlier on the rapid increase in the sales of alternative cars: electric vehicles, hybrid vehicles, CNG and flex-fuel vehicles etcetera… At the present pace, the fleet of vehicles in the most powerful economies will be a hybrid one, reducing demand for crude oil with the expected consequences on price.

The efficiency of engines in households, commercial centers and industries is also under environmental pressure to comply with ever stringent laws on emission that force them to either increase efficiency of their motors or move away from crude oil to another source.

Technology in shale oil has over the past months increased the supply of crude oil significantly enough to weigh down the price, as the USA became the first producer of crude oil in the world in 2015 averaging 9.3 million barrels a day. While the world now has more supply of crude oil, the increase in demand has been averaging little more than one per cent a year; while the global economic growth is more than twice this figure.

The fast growth of renewable energies, covered in detail in previous chapters of this book, substituting for fossil fuels (namely crude oil and natural gas) is fast invading several economic sectors (automotive included). This is also a source of diversification from crude oil that is sure to turn the black gold of the twentieth century into a product barely as valuable as coal in the twenty first

century. With the fast emergence of hybrid vehicles covered with photovoltaic s supplied with solar energy; energy conserving households and commercial centers making use of net metering and feed in tariffs, it is a fact that crude oil has already lost some seventy percent of its value. It is perhaps useful to point out that while coal today still makes up around a quarter of global energetic needs, one metric ton of it sells for around seventy USD. As the demand for crude oil wanes, one metric ton of it (7.25 barrels approximately) should fetch not much more than, say a hundred dollars. That means a crude oil barrel at fourteen USD’s!

b. Natural Gas:

Natural gas in the market place is now a fierce competitor to crude oil, being substituted for it in most economic sectors; combined heat and power industries and automotive vehicles. Gas to Liquid technology is making it possible to extract benzene and other aromatic products from natural gas which yield industrial goods once obtainable only from crude oil.

Natural gas is sold in the currency of the countries dealing with it; for instance Russians can accept Euros when they sell their gas to Europeans; yet when they sell their crude they can only accept USD’s.

The snapshot above shows that conventional Russian gas is even cheaper to extract to well tip than American gas. In West Siberia, European Russia and East Siberia it costs respectively 0.90 USD/Million BTU, 1.081 USD/Million BTU and 2.2 USD/Million BTU! This is lower than the Henry Hub price we saw earlier.

In countries to which natural gas has to be transported by ship or pipes the landed price varies between ten to nineteen USD per million BTU.

The availability of a sustainable and affordable way of natural gas supply is very much regional; presently it is the most abundant in the USA and Russia. Other countries might have shale gas but lack the autochthone acquired knowhow to extract it economically.

2. Economy:

As the economy grows –or stalls- energy requirements need to be addressed. Presently, due to the impactful advances in technology, although global economic growth is on-going the demand for crude oil is receding as we produce two million barrels in excess a day in 2015. As we move into 2016, the excess inventory will weigh down the price of crude oil under the cumulated pressure of less demand (better technology in engine efficiency and renewable) and more supply (better technology in fracking, more production from more countries).

The world’s economy will continue to expand despite pockets of recession and even crisis, and fuel its growth increasingly from natural gas and renewable sources possibly pushing the price of crude oil further down. It is to be noted that economic growth is separate from employment growth, thanks to robotics and software; another consequence of technology. The world economy is ing growth of nearly three percent in 2015, whereas the growth in demand for crude oil is 0.9 million out of a total demand of 92 million barrels a day. Therefore growth in demand in 2015 for crude oil is 0.98%. This suggests economic growth in the world can take place with less dependency on crude oil than in previous years. Countries with powerful and diversified economies tend to be net importers of crude oil (USA, China, Japan, European Union etcetera…) and lower crude oil prices are welcome as they help the balance of trade. However, economies are precarious and can react unpredictably to sudden shocks: too high and sudden an energy price increase can lead to hyperinflation; a sudden chute to deflation.

a. USA:

Information Handling Services (I.H.S) expects a world economic growth about three percent with the economy of the USA leading the world. While the economic growth of the USA at almost three percent a year forecasted (I.H.S) for 2016 is in percentage half that of China, the size of the USA economy is nearly twice that of China.

Furthermore, the USA benefits from a unique combination of raw material (renewable as well as fossil fuel) as well as the most advanced technological knowhow, sustainable research and development and diversified economy. The shale advantage, has started to help unleash a major wave of prosperity that will incentivize a reverse migration of investments from China and Europe into the USA. The reason is lowest cost of energy and a business environment on the whole friendlier than in other countries.

b. China:

Domestic oil production supplies only two thirds of the country’s oil needs and it is estimated that China will require 600 million tons of crude oil by 2020. This might help explain China’s recent military and pervasive commercial presence in the Middle East and Africa. Nominal growth has slowed to 6.2% and could hit 5% by the end of 2015, the weakest since 1999, translating directly into weak cash flow for companies that already face heavy debt burdens. The industrial sector has been especially hard hit, with the country’s northern rustbelt (inner Mongolia and the three provinces of Liaoning, Jilin and Heilongjiang, please see below) on the brink of a recession. And more than a percentage point of overall growth this year has stemmed from activity in the speculative and void of value added financial sector, a contribution that will fall away quickly in the wake of this summer’s stock-market collapse. Many analysts reckon real growth is closer to 5% at most, well shy of the government’s 7% target.

c. :

In spite of recent headwinds from weaker export demand in emerging markets, ’s economic growth continues to be ed by favorable labor market and financing conditions sustaining domestic demand. The renewed decline in oil prices and additional public spending should provide further stimulus. The general government budget is set to remain in surplus. Overall, real GDP is expected to increase by 1.7% in 2015 and 1.9% in 2016 and 2017.

d. United Kingdom:

The economy is projected to continue to be driven by domestic demand, in particular, robust growth in private consumption. Inflation is expected to trough in 2015 but rise modestly in 2016 and 2017 to approach the Bank of England’s inflation target. The labor market is projected to remain firm as the rate of increase in employment slows but productivity rises.

e. :

’s economy is expected to slightly accelerate over the forecast horizon, driven initially by strong private consumption and then by a recovery in investment, while net exports would detract from growth again. Unemployment, however, looks unlikely to improve until 2017. The government’s headline budget deficit is expected to fall to 3.8% of GDP in 2015 and to continue decreasing to 3.4% of GDP in 2016 as growth gently picks up. Household real income is also expected to be ed by lower energy costs.

3. Legislation:

Technology is guided by legislation that sets limits on the emission of harmful gases. Legislation aims to do away with fossil fuels and encourages a gradual shift to renewable energies in an economically sustainable way. As technology empowers significant economies to rely more on renewable energies for growth, there is less demand for crude oil and other fossil fuels (although be it natural gas is less polluting than coal and crude oil).

Emission standards are the legal requirements governing air pollutants released into the atmosphere. Emission standards set quantitative limits on the permissible amount of specific air pollutants that may be released from specific sources over specific timeframes. They are generally designed to achieve air quality standards and to protect human health. Many emissions standards focus on regulating pollutants released by automobiles (motor cars) and other powered vehicles. Others regulate emissions from industry, power plants, small equipment such as lawn mowers and diesel generators, and other sources of air pollution. An emission performance standard is a limit that sets thresholds above which a different type of emission control technology might be needed. While emission performance standards have been used to dictate limits for conventional pollutants such as oxides of nitrogen oxides and oxides of sulfur (NOx and SOx), this regulatory technique may be used to regulate greenhouse gasses, particularly carbon dioxide (CO2). In the US, this is given in pounds of carbon dioxide per megawatt-hour (lbs. CO2/MWhr), and kilograms CO2/MWhr elsewhere.

4. Politics:

Of the four TELP factors, Politics is the least transparent and predictable, yet very influential. Any incident affecting the regular sailing of tankers whether carrying crude oil, or natural gas through the many chokepoints of the world could have consequences on the prices of these precious products. Other political developments could lead to sanctions that disrupt a modus operandi and bring shocks to the market place.

a. Crude Oil:

We are now witnessing the dusk of the age of what was once called Black Gold. Since its discovery in Titusville, Pennsylvania in the USA in 1861, at the onset of America’s Civil War, crude oil found its destiny in politics fueling the Federal army’s manufacturing of canons and battleships and helping The North defeat the South. Throughout the twentieth century, the British Empire, and later the USA sent their invading troops to Iran, Iraq and eventually throughout the Middle East and Africa to serve what must be a labyrinthine agenda made up of economic and geopolitical interests.

Within the USA, a publication entitled The History of the Standard Oil Company by Ida Tarbell in 1912 suggested that oil magnate and owner and founder of Standard Oil John Davison Rockefeller was simply a terrorist who had thugs sent to blow up refineries whose owners refused to sell their business to his company. So much was her work credible that in 1999, The New York Times chose it as one of the most important writings of the twentieth century and the Library of Congress has it protected in its archives.

While Ida Tarbell published her book in 1912, a young iral of The Royal British Navy named Winston Churchill was trying to ink deals in the Middle East to acquire crude oil needed to substitute for coal in British battleships. This would eventually lead to Western military occupation and meddling in the politics of the Middle East and Africa which would in subsequent years see an even bigger Empire –the USA- lead two wars in the Middle East and an occupation that persists till today.

Prior to Pearl Harbor on December 7th 1941 the British and Deutsch had kept Japan from sourcing crude oil and other important products in Indonesia whence it sourced ninety two percent of its energetic needs. This embargo may have

tipped the Nippon nation to commit Pearl Harbor and enter the war against the Americans, becoming a common enemy to the Allies.

Till today, several Middle Eastern and African countries are home to military bases of the most powerful countries the world has ever seen. What these occupied countries hosting and financing foreign armies have in common is that their soils abound with crude oil and natural gas.

b. Natural Gas:

Natural gas is emerging as a strategic source of energy to substitute, along with renewable sources, for the secession of crude oil and coal. The pipelines originating mostly in Russia and some in Azerbaijan and Kazakhstan and Iran (read Oil & Gas in The Twenty First Century by the same author) have created the era of “Gas Diplomacy”, which in some parts of the Middle East is not diplomatic at all!

The main pipelines of the world now under construction for the most part, or probably causing wars, pogroms and exoduses before they are built can be summarized as follows:

i. Natural Gas Pipelines Dominated by Russia:

1. Nord Stream:

It originates in Russia and es underneath the Baltic Sea. At 1,222 kilometers (759 mi) in length, it is the longest sub-sea pipeline in the world. It is completed. The project includes two parallel lines. The first line was laid in the month of May 2011 and was inaugurated on the 8th of November 2011. The second line was laid in 2011–2012 and was inaugurated on the 8th of October 2012. The pipeline project was criticized by some countries and environmental organizations (such as the World Wide Fund for Nature). At the same time, the European Commission energy commissioner office confirmed that the EU s the project “as an additional source of gas supplies from Russia”. It is a good example of the superior national economic interest overriding legitimate environmental concerns.

2. South Stream:

A gas pipeline that would deliver 63 billion cubic meters (billion cubic meters) to Southern Europe from Russia underneath the Black Sea, crossing Bulgaria and then onto Serbia, Hungary, Slovenia, Italy, Bosnia and Herzegovina, Croatia, and Austria. South Stream had the potential to meet 20 percent of EU gas demand, but President Putin cancelled it in December 2014. Gazprom has officially confirmed that Russia will construct an alternative pipeline using funds and materials intended for the original South Stream project at some point in the near future. The sanctions imposed on Russia after its self-restitution of Crimea and ongoing hostilities with Turkey might weigh on whether Russia will go ahead with it, or mothball it, and will influence its route. South Stream could be part of an arm wrestling between Russia and Western powers that try to limit its expansive influence mediated through its supply of precious energy. Europe, particularly eastern states within it, as well as Turkey tend to bend to Western intimation to be belligerent toward Russia.

The Kremlin has imposed trade sanctions on Turkey after the jet incident in December 2015 although so far the measures have not affected the Russian energy exports to Turkey. As of December 2015 no decisions are made on the project nor on a nuclear power station that Russia is building in Turkey.

3. Altai:

The Altai gas pipeline is a proposed natural gas pipeline to export natural gas from Russia’s Western Siberia to North-Western China. This line is stirring nationalism amongst Altai leaders who view the line as increased dominion by the Chinese. It is under completion in 2015.

ii. Natural Gas Pipelines Dominated by Western Powers:

1. TAPI (Trans-Afghanistan Pipeline):

The pipeline will transport Caspian Sea natural gas from Turkmenistan through Afghanistan into Pakistan and then to India. Construction on the project is now scheduled to resume on December 13th, 2015. The pipeline is expected to be operational by December 2018. TAPI has been controversial since its inception in the 1990’s since its age through Afghanistan made it a prerequisite to have a friendly government in that country to the USA.

Various theories have been presented regarding its influence of US foreign policy in the Eastern Hemisphere. The original TAPI project started on March 15th 1995. Russia, controlled most export pipelines in the East, and bargained to allow the use of its pipeline network. The West has always been in a perennial struggle with Russia for world dominion.

2. Trans-Caspian Pipeline:

The Trans-Caspian Gas Pipeline project is to transport natural gas from Turkmenistan and Kazakhstan to European Union member countries, circumventing both Russia and Iran. It is also considered as a natural eastward extension of Southern Gas Corridor(The Southern Gas Corridor is an initiative of the European Commission for the gas supply from Caspian and Middle Eastern regions to Europe). This project attracts significant interest since it will connect vast Turkmen gas resources to major consumer geographies as Turkey and Europe.

3. White Stream Pipeline:

To be soon completed in 2016 White Stream (also known as the GeorgiaUkraine-EU gas pipeline) is to transport natural gas from the Caspian region to Romania and Ukraine with further supplies to Central Europe. Circumventing Russian dominance of gas markets, this pipeline would further compete with Russian power and give great E.U. connectivity to its neighbor, Georgia. Its length is 1,238 km (769 mi). The pipeline would branch off from the South Caucasus Pipeline (originating in Baku, Azerbaijan) near Tbilisi and run for 133 kilometers (83 mi) via Georgia to Supsa at the Black Sea.

iii. Rivaling Natural Gas Pipelines:

1. The Iran-Iraq-Syria Gas Pipeline:

The Iran-Iraq-Syria pipeline is a proposed natural gas pipeline running from the Iranian South Pars / North Dome Gas-Condensate field towards Europe via Iran, Iraq, Syria and Lebanon. The pipeline was planned to be 5,600 km (3,500 mi) long. A previous proposal, known as the Persian Pipeline, had seen a route from Iran’s South Pars to Europe via Turkey; it was abandoned due to political complications. Iraq signed an agreement with Iran in June 2013 to receive natural gas to fuel Iraqi power plants in Baghdad and Diyala. The contract covers 1.4 Bcf/d over 10 years. Iran’s plans to export 176 MMscf/d of gas to Iraq by 2015. In July 2011 Iran, Iraq and Syria said they planned to sign a contract potentially worth around $USD 6bn to construct a pipeline running from South Pars towards Europe, under the Mediterranean to a European country, with a refinery and related infrastructure in Syria.

2. The Qatar Turkey Gas Pipeline:

The Qatar-Turkey pipeline is a proposed natural gas pipeline running from the Iranian-Qatari South Pars / North Dome Gas-Condensate field towards Turkey, where it could connect with the Nabucco pipeline to supply European customers as well as Turkey. One route to Turkey is via Saudi Arabia, Jordan, and Syria, and another is through Saudi Arabia, Kuwait and Iraq.

iv. Extent of European Dependence on Russian Natural Gas:

By 2020, the EU aims to reduce its greenhouse gas emissions by at least 20%, increase the share of renewable energy to at least 20% of consumption (from a present average of nearly 15% amongst the 28 countries of the EU), and achieve energy savings of 20% or more. All EU countries must also achieve a 10% share of renewable energy in their transport sector. Through the attainment of these targets, the EU can help combat climate change and air pollution, decrease its dependence on foreign fossil fuels, and keep energy affordable for consumers and businesses.

Despite these lofty goals, Europe has not been able to move coherently toward the proclaimed targets in emissions and a chasm separates its in the emancipation degree reached as far as being independent energetically, let alone harnessing renewable sources to growing needs. As can be seen from the snapshot below, , Italy, Eastern Europe and many other countries in Europe depend indispensably on Russian gas still.

There are plenty of announced initiatives that call for a green and sovereign economy such as accelerating investment into efficient buildings, products, and transport. This includes measures such as renovation of public buildings, and Eco-design requirements for energy intensive products. Also, building a panEuropean energy market by constructing the necessary transmission lines, pipelines, LNG terminals, and other infrastructure. Green initiatives in Europe include implementing the Strategic Energy Technology Plan – the EU’s strategy to accelerate the development and deployment of low carbon technologies such as solar power, smart grids, and carbon capture and storage.

4

Prosperity Through Energy in The Middle East And Africa (MEA)

To grow and prosper countries need energy to fuel diversified economies. The Middle East and Africa (MEA) have in their soil a considerable wealth of crude oil and natural gas; which they have tried to leverage to achieve prosperity for over seventy five years now to little avail. Before breakthroughs in technology, it was common to state that the MEA region contained half or even more of the world’s oil and gas. Since most countries in the MEA region had historically little technological knowhow they found no use for these riches other than to sell them for cash with the promise that this cash could serve to educate their population, transfer and implant valuable knowledge to autochthone workforce, attract local, regional and international investments and gradually strengthen and enrich their economies with diversification. The results reached so far in economic diversification are chequered at best since public treasuries still rely as much as they did seven decades or so ago on the sale of a single primary and unprocessed product: crude oil (some MEA OPEC sell natural gas).

There was once a conjuncture which made it possible for MEA countries to post yearly growth despite being single product economies: high unit price per barrel, high level of production, lack of technological breakthroughs in drilling and exploration in Western oil rich nations, a world economy addicted to oil, a world transportation industry reliant on gasoline or diesel, lack of developments in renewable sources of energy, a lax legislative environment, smaller populations to look after, and perhaps a semblance of peace and stability at least in pockets of the MEA region that produce oil.

These circumstances have changed drastically as the price of the crude oil barrel sets new floor levels and the number traded daily at stock exchanges is sevenfold or more the amount in actual demand. In 2015, the world economic growth is expected to be around three percent; yet the growth in demand for crude oil will be 0.9 percent! This suggests that energy sources other than crude oil claim a higher contribution to economic growth: as we detailed in previous pages renewable sources are making strides. The chance at sustained prosperity for MEA nations will depend on their ability to increase their refining capacity to extract more derivatives and process them into as many end products as possible (read Prosperity Through Petrochemicals of the same author), rather than stick to either selling unprocessed primary crude oil or natural gas.

Oil and once gas rich countries in the MEA region illustrate well the fact that mega multibillion dollar projects executed with imported machinery and expatriate labor under foreign management create little wealth and employment to the host country. Employment is generated through midsize and small companies that, in the context of petrochemicals, source as many of their raw materials as possible from qualified local suppliers. What is presently happening is that knowledge strong countries use MEA as a reliable supplier of primary raw material (such as crude oil and natural gas) which they know how to process into indispensable finished products that they sell back to MEA countries with a huge markup. Plastic industries in the MEA region become unable to grow through profitable exports and end up competing locally for thin margins.

What is needed is an educational system that grooms students to specialize in the value chain starting with exploration and drilling techniques, to enhanced recovery technologies, to the petrochemical processes that make the polymers shown in the above chart from Information Handling Services (I.H.S) which are the needed raw materials to the plastic industries that employ citizens forming the middle class of society.

Presently, a number of countries in the MEA region have secured enough energy for the foreseeable future while others face shortages.

i. Energy in MEA Countries:

Few issues in the Middle East & Africa (MEA) region are more pressing than the need to meet rising demand for power. Rapid population growth is driving substantial increases in electricity demand and in many instances, countries are struggling to meet the challenge and power outages have become increasingly common in the MEA region. To cope with the additional demand and restore the reserve margin to at least 15 per cent, most utilities in the region have embarked on extensive capacity building programs up to 2020 and beyond. Installed generating capacity across the 14 countries covered in this report will have to rise by an estimated 144,218 MW in order to reach the combined target of 420,335 MW by 2020, a 34 per cent increase on installed capacity of 276,117MW. This will likely require a capital investment of more than $USD 200 billion in the power generation sector alone, and an equal amount for the transmission and distribution sectors. But increasing capacity may well be the easy part. Securing the feedstock to power it is likely to prove far more challenging given the paucity in unallocated natural gas in the GCC (Gulf Cooperation Council countries). A variety of solutions are being pursued in response to the feedstock challenge.

Saudi Arabia and Dubai have all ed Abu Dhabi, Morocco, Algeria, Egypt and Jordan in announcing ambitious solar energy programs, while nuclear energy is being pursued in several states. Even the politically delicate issue of tariff reform is beginning to be explored throughout the GCC countries with Abu Dhabi and Egypt announcing tariff increases this year following steps taken by Jordan and Morocco previously.

There is a pressing need to secure financing sources for the planned power plants in MEA countries. Till now, taxes in the GCC consisted primarily of corporate income tax, withholding tax, and Zakat (a religious tax based on Islamic law (the Sharia), assessed on earnings and holdings, and constitutes the giving of a fixed portion of one’s wealth to charity, generally to the poor and needy). Non-Saudi

nationals are taxed on income from self-employment, income from capital investment, and income from any business activity conducted in the Kingdom of Saudi Arabia at a rate of 20 percent. Citizens of Saudi Arabia and the Gulf cooperating countries (Bahrain, Kuwait, Oman, Qatar, and the United Arab Emirates) are generally exempt from the payment of income tax but, instead, are subject to the payment of Zakat. In 2016, this is about to change as countries that are used to triple digit price levels for crude oil have to make up for lost revenues at prices that are still low in the double digit figures and have every likelihood of falling lower.

In the GCC, all of the utilities were able to keep supplies ahead of demand. The current situation has improved significantly although Bahrain and Sharjah both suffered occasionally from power cuts during peak periods in recent years. However, while the power situation for GCC states has become generally more comfortable, Oman had to rely on temporary supplies in the summer from 2011 to 2013, and Abu Dhabi is facing a race to meet forecasted demand by 2016 as a result of delays with important projects. The UAE capital will hope that its decision to reduce subsidies and reform electricity and water tariffs from January 2015 will reduce consumption and control demand growth. The improvement in the GCC’s power market is largely due to governments continuing to invest heavily in boosting generation capacity. However, the situation in the rest of the region is not as comfortable. Indeed, Iraq in the short term faces by far the biggest challenge in meeting demand. Its installed capacity of 11,025MW in 2013 was 33 per cent lower than the peak demand of 16,547MW recorded during the year. After more than two decades filled with conflicts and underinvestment, Iraq’s Electricity Ministry has awarded contracts for more than 11,000MW of new power since 2011 as part of its short-term electricity plan to meet the demand by 2016. The ministry had hoped for an additional 8,000MW to come on line in 2014 and an additional 20,000 MW by 2017.

Libya’s reserve margin of 31 per cent is also misleading, as the 2011 civil war resulted in damage to electricity networks and as a result many households suffered, and continue to suffer, extensive power shortages and blackouts. The country is also still struggling to secure adequate fuel for power stations, with many of the gas fields used to produce fuel for power plants still shut down.

Egypt’s official reserve margin of 12 per cent should also be treated with skepticism. In 2014, Cairo suffered from prolonged blackouts during peak periods, which caused major problems such as disrupted metro services. Reserve margins are set to be put under increasing pressure in the coming years, with the vast majority of states across the MEA region recording an increase in peak demand growth in 2013. Qatar was the only country analyzed which recorded a drop in peak demand in 2013. Abu Dhabi is an example of a country which had a reasonable reserve margin in 2013, 19 per cent, but is facing the threat of supply shortages in the next few years as a result of increasing demand and delay with procurement of vital projects.

In the table below, we detail the required additional capacity by 2020 per country. The largest new build requirement will be in Egypt, with an estimated 30,000 MW of new capacity needed as a result of its rapidly growing population. While the GCC will require additional capacity of just over 70,000 MW, the actual additional power requirement will be much higher as a result of the increasing amount of capacity which will be required to be replaced or upgraded on of age.

This will also likely be the case in Libya, where much of the existing power infrastructure is outdated or was damaged during the events of the past years. Iran’s requirement for an estimated 18,500 MW of new capacity by 2018 is due to a combination of rapid population and industrial growth. Tehran’s subsidy reforms have helped to assist with reducing demand growth, which was growing at an alarming rate before 2010. Since Iran has come to a permanent solution with the P+5 powers regarding its nuclear program, the potential growth of its economy would result in a sharp rise in electricity required in the coming years.

The new capacity requirements appear daunting, but some of the region’s utilities have already made significant inroads into meeting the 2020 capacity targets.

ii. The Incongruence of Feedstock to Power in The MEA:

It used to be common wisdom to think of the Middle East and Africa as awash with crude oil and natural gas boasting some seventy percent of the world’s reserves according to most experts’ reports. Presently, this old adage seems to be barely half true since several GCC countries still have crude oil but are simply out of unallocated gas. There are putatively natural gas reservoirs throughout the GCC, Egypt, the Levant, Iran and other countries too, yet many of these countries are reported to be in a state of quandary as to how to continue to fuel their power plants as they expand capacities. There are also yet unanswered questions as to how much one million BTU of extracted natural gas would cost.

As we analyze energetic resources of major blocks and countries, we observe that while one country in the Middle East has overabundant natural gas resources that it exports expensively to the remotest ports in the Far East and Western Europe, its neighboring brotherly countries are contemplating building expensive nuclear stations of which they know nothing about and where they would have to be entirely dependent on foreign knowhow and operators. This in spite of the existence of natural gas pipelines like the Dolphin Gas Project between these countries which have been built but remain underutilized.

Kuwait, Abu Dhabi, Dubai, Bahrain and Egypt (until the breakthrough recent natural gas field discovery (Zohr) by Eni off its shores) are said to be building expensive Liquefied Petroleum Gas (LPG) import terminals with storage and regasification facilities rather than import compressed natural gas much less expensively from land connected Qatar, the richest country on the planet in natural gas reserves with the smallest population! Iraq, Oman and Kuwait have reported that they are in negotiations with Iran to pipe natural gas, although Qatar is much closer to them. In Egypt, Eni has made a world class supergiant gas discovery at its Zohr Prospect, in the deep waters of Egypt. The discovery could hold a potential of 30 trillion cubic feet of lean gas in place covering an area of about 100 square kilometers. Zohr is the largest gas discovery ever made

in Egypt and in the Mediterranean Sea. Eni will immediately appraise the field with the aim of accelerating a fast track development of the discovery that will utilize at best the existing offshore and onshore infrastructures. This is an opportunity for Egypt to use natural gas as a clean and relatively much safer source of energy than nuclear power. Natural gas in Egypt can be a precursor of prosperity as it can be used as petrochemical feedstock which is now still imported, disfavoring Egypt’s balance of trade. Egypt’s gas could easily be piped throughout the Middle East region to serve as a power source and petrochemical feedstock to substitute for imports and help boost the entire region’s balance of trade.

iii. The Obvious Alternative Energy Sources in The MEA:

The Middle East and Africa is one region of the world where demographic growth is several times higher than economic growth. While gulf countries seem to have presciently addressed the issue of power generation, in most other countries in the MEA region citizens have to generate their own power, often from polluting sources which lowers their standard of living and discourages investments and expansions. This contributes to continuous underdevelopment as our region plunges deeper in the darkness while the rest of the world uses ingenuity to create wealth from the primary energetic resources imported from the MEA. It must be pointed out that pockets of economic growth in the MEA region exist, but from such weak bases and historically the growth has been spurred by the sale of primary energy to Europe and other powerful economic poles.

iv. Renewable versus Nuclear Power in The MEA:

Presently over 99% of energy is still provided by fossil fuel in the MEA region, versus around 84% worldwide (2015 estimate). Despite vast potential, barriers remain that prevent renewable energy from becoming a reality in the MEA countries. These include an absence of renewables friendly regulations and in some countries highly subsidized fossil fuels. Changes in the regulatory framework will be necessary. Policies and regulations that promote the development of renewable energy should not solely address large-scale centralized generation. Governments can promote small and medium scale projects such as installing rooftop solar PV s and solar water heaters in the cities.

Should an increasing number of MEA countries transition to renewable sources of energy, job creating industries employing higher value added jobs in engineering, software, finance, and other domains as well would emerge and burgeon. The nature of the renewable energy industry does not have to be centrally controlled or dominated by powerful cartels, as the case is in oil and gas. Solutions can be fitted to communities depending on their topography, undersoil heat, access to sea, strength of tides’ currents, solar intensity, wind speed, water abundance and other factors as well. Investments can be of a medium or even small scale, which create more local job opportunities than billion dollar projects awarded to titanic oil and gas multinationals that necessitate the imports of steel structures and mechanical equipment made in South Korea, or the USA. The costs of making solar s is fast coming down, as China becomes a major supplier of such equipment. Some of the primary raw material could be sourced within the GCC including silicon and ethyl vinyl acetate layers used in lamination. While some countries in the MEA region have shown yet shy attempts at harnessing renewable natural resources for energy, some are seeking nuclear power at colossal costs. Nuclear safety procedures are most stringent. If not followed consistently and conscientiously, nuclear leakages could cause lethal and incalculable damage for generations to come. The import of nuclear technology and the costly construction and

commissioning of nuclear power plants would create a dangerous dependency on foreign powers (whether Russia, USA, or other) which would leave millions of people exposed to lethal radioactivity should a malfunction occur at a time when expatriate experts chose to return home and leave their work in the MEA. The balance of payment of all MEA countries would be hurt by the purchase of nuclear technology.

There is a stammering of a renewable initiative in the United Arab Emirates where inroads have started to be made to generate power from the sun.

a. The Case of The UAE:

The United Arab Emirates has always managed to lead in distinguished initiatives on the Arabian Peninsula. The UAE began actively promoting the development of solar power generation in April of 2008. Both Dubai and Abu Dhabi have ambitious initial targets. At the initial stage the solar power equipment will be imported, but studies are being carried out to gradually establish manufacturing of parts and assembly operations of solar power components within the UAE.

The UAE is planning to generate the vast majority of its electrical energy by 2050 from solar and nuclear sources. In 2013, the Shams solar power station, a 100-megawatt (MW) –which corresponds roughly to less than 0.9% of total energy produced in the UAE- concentrated solar power (CSP) plant near Abu Dhabi became operational. The US$600 million Shams 1 is the largest CSP plant outside the United States and Spain and is expected to be followed by two more stations, Shams 2 and Shams 3. Masdar City in Abu Dhabi is designed to be the most environmentally sustainable city in the world. The city relies entirely on renewable energy. Power is generated by a 10 MW solar PV power plant located on site and 1 MW of rooftop solar s.

The Dubai Clean Energy Strategy aims to provide 7 per cent of Dubai’s energy from clean energy sources by 2020. It will increase this target to 25 per cent by 2030 and 75 per cent by 2050.

United Arab Emirates is installing nuclear-powered plants to meet their electricity demand, which is estimated to increase from 15.5 GWe to over 40 GWe in 2020. UAE has also signed Nuclear Non-Proliferation Treaty (NPT).

b. The inspiring case of El Hierro Island:

El Hierro island is part of the Autonomous Community of Spain, in the Atlantic Ocean off the coast of Africa, with a population of around 11,000 and a surface area of 268.71 square kilometers. It is the first island in the world to be selfsufficient from renewable energies. This will be achieved through a €54 million project combining a greater than 11 megawatt wind farm and two hydroelectric projects. This hydro- and wind-power project, created by the local Gorona del Viento El Hierro consortium with financial aid from the European Union, and officially inaugurated in 2015, consists of five wind turbines of type E-70 capable of producing 11.5 megawatts of wind power to supply electricity for all residents and an additional number of tourists, and three water desalination facilities. The hybrid wind/pumped hydro storage system stores surplus wind power by pumping water up 700 meters (approximately 2,300 feet) to fill the crater of an extinct volcano. When winds are calm or when demand exceeds supply, water is released from the crater to generate 11.3 MW of electricity, filling an artificial basin created at the bottom of the extinct volcano. Water in the lower basin is then pumped back up again to the upper reservoir when there is excess wind power. The closed-loop hybrid wind/hydro system is expected to save approximately US$1.6 million per year (calculated with January 2015 oil prices) previously spent on about 40,000 barrels of crude oil imported annually, and makes the island completely self-sufficient for electrical energy. The abundance of water makes some agriculture possible and invites investments in the hospitality sector.

This case could be an inspiration for communities across the MEA region to find micro-solutions in renewable energies tailored to the particularities of their region that can generate clean energy indigenously generated, employing local educated people and deepening their attachment to their land. Such an approach would incentivize the educational establishment to offer degrees and diplomas in their curriculums that address renewable energies.

5

Emancipation Through Education in The MEA

The MEA region is a case that illustrates well the futility of making do with the sale of primary raw material –fossil fuel or indeed other primary precious material like diamonds or gold- when the ultimate objective is to have a well implanted prosperous middle class. Africa is amongst the best endowed countries in the world in natural resources; five African countries are of OPEC (Algeria, Nigeria, Gabon, Angola, Libya), yet all of them are way below the poverty line. If one makes a small calculation as to the amounts of hard currency cash money OPEC countries received over the last five years only, one would multiply: 30,000,000 barrels a day (as average shown in below graph)*85 (average OPEC crude oil price per barrel as shown below)*350 (we assume fifteen days lost production time to for scheduled and unscheduled maintenance)*5 (as a sample from 2010 till 2015)= 4,462,500,000,000 USD! (Four Trillion Four Hundred And Sixty Two Billion Five Hundred Million USD’s!). 16 % higher than ’s 2014 Gross Domestic Product (which stood at 3.8 trillion USD’s in 2015)!

Over four trillion USD’s generated over the last five years only (2010-2015) by OPEC countries and yet, most of them still lack basic infrastructure in powerlines and power stations! Many OPEC countries still suffer from power shortages! The same can be said for water, sewage, roads, quality of public schools, medical care etcetera…

The oil-pipe infrastructure of some OPEC countries in Africa is said to be decaying for lack of proper maintenance, and, incredibly some are occasionally reported to import crude oil! Some OPEC countries in Africa export Liquefied Natural Gas (LNG) to Europe instead of using this precious raw material to

develop their petrochemical industries and their agriculture through the manufacture of polymers and fertilizers.

The blue bars in the graph above reflect OPEC prices of crude oil barrel from 2010 till 2015, as of December 15th. (http://www.statista.com/statistics/262858/change-in-opec-crude-oil-pricessince-1960/)

With the noted exception of some Gulf Cooperation Council (GCC) countries who have succeeded to a large extent in diversifying their economies through industrial areas and parks with built plastic factories, many an OPEC country is already in a desperate state of decrepitude and could alas, get worse as the price of crude oil –the only product they have for sale- heads to lower levels while their population multiplies. We can diagnose the disease gnawing some OPEC countries and recommend a cure.

i. The Contrast Between The Energy Protection Conservation Act (EPCA) And OPEC’s Founding Charter:

The USA House of Representatives voted on October 9th 2015 to lift a 40-year ban on the export of crude oil. American oil companies could now enter the arena of global crude oil competitors since the bill has been ratified (President Obama had said he will veto it, but did not). We must however point out that in 2015 the USA was still importing around 7.4 million barrels a day of crude and had a refining capacity of 18 million barrels a day. The option to export USA crude oil could presently help adjust accumulating inventory and buoy the price.

The ban that was voted to be lifted on October 9th 2015 is called the Energy Protection And Conservation Act proposed by President Henry Ford and enacted into law by Congress on December 22nd 1975 which essentially made it illegal for American oil companies to export their product from the USA. One consequence of the EPCA ban (now defunct) is that refiners of crude oil in the USA could purchase their crude oil from any supplier that lowered his price enough for them; such a supplier could be in Latin America, or the Middle East or Africa or Scandinavia….These refiners could then process this crude into its plethora of derivatives, polymers or liquids, to supply USA –or elsewhere- based downstream industries. However, USA based crude oil suppliers could only sell within the USA; they were captive to the downstream industry. The EPCA favored downstream purchasing bargaining power and helped make the oil producing industry an engine of economic development. Advanced and powerful oil producing countries (USA, China, United Kingdom, Holland, possibly others) have refining capacity close to twice their production capacity of crude oil. That is because oil is the raw material, the precursor to downstream industries that make finished products from it used in modern life: in transports, in communication, in clothing, in food and beverage packaging etcetera…

In OPEC countries, it is rather the other way around: the downstream industry tends to be captive to single behemoth suppliers, and the refining capacity is

negligible as compared to the production capacity of oil.

The mission of OPEC as stated on its website is: “In accordance with its Statute, the mission of the Organization of the Petroleum Exporting Countries (OPEC) is to coordinate and unify the petroleum policies of its Member Countries and ensure the stabilization of oil markets in order to secure an efficient, economic and regular supply of petroleum to consumers, a steady income to producers and a fair return on capital for those investing in the petroleum industry”. The underlined mission statement in larger font defines the raison d’être of OPEC as a supplier of crude to advanced countries (the word “consumers” is a euphemism for downstream refiners and “value adders” who exist mostly in China, Western Europe, USA and some other countries). There is an implicit pact sealed in the Mission statement of OPEC to make the oil industry an engine of underdevelopment in some of the countries where it operates.

ii. The Cure to The Dutch Disease:

a. Rebuilding Education:

All areas and branches of education ought to be welcome and embraced in a society that aspires to prosper and achieve healthy living standards for its citizens. In this chapter, we shall concentrate on the lore to be added to citizens in the MEA region (this book’s author has Lebanon on his mind) from the oil and gas value chain: From software and hardware technologies in seismic analysis and exploration, multidimensional seismic imaging, enhanced oil recovery techniques, oil to chemicals technology, gas to liquids and gas to chemicals technology, catalytic reforming, steam cracking, polymer science and polymer engineering, conversion technologies and industrial processes, supply chain management software and the list remains long of areas of specializations that open additional possibilities for our industry, our economy and future investors and professionals.

Few weeks before this finding Egypt was getting ready to purchase natural gas from a neighboring yet belligerent country precisely because technical reports from other oil and gas companies had reported no commercial quantities available in the same area.

Reflection seismology, more commonly referred to as “seismic reflection” or abbreviated to “seismic” within the hydrocarbon industry, is used by petroleum geologists and geophysicists to map and interpret potential petroleum reservoirs. The size and scale of seismic surveys has increased alongside the significant concurrent increases in computer power during the last 25 years. This has led the seismic industry from laboriously – and therefore rarely – acquiring small 3D surveys in the 1980s to now routinely acquiring large-scale high resolution 3D surveys. The goals and basic principles have remained the same, but the methods have slightly changed over the years. The primary environments for seismic exploration are land, the transition zone and marine:

Land - The land environment covers almost every type of terrain that exists on Earth, each bringing its own logistical problems. Examples of this environment are jungle, desert, arctic tundra, forest, urban settings, mountain regions and savannah.

Transition Zone (TZ) - The transition zone is considered to be the area where the land meets the sea, presenting unique challenges because the water is too shallow for large seismic vessels but too deep for the use of traditional methods of acquisition on land. Examples of this environment are river deltas, swamps and marshes, coral reefs, beach tidal areas and the surf zone. Transition zone seismic crews will often work on land, in the transition zone and in the shallow water marine environment on a single project in order to obtain a complete map of the subsurface.

Marine - The marine zone is either in shallow water areas (water depths of less than 30 to 40 meters would normally be considered shallow water areas for 3D marine seismic operations) or in the deep water areas normally associated with the seas and oceans (such as the Gulf of Mexico).

Seismic surveys are typically designed by National oil companies and International oil companies who hire service companies such as Breckenridge Exploration Co., CGG, Petroleum Geo-Services and WesternGeco to acquire them. Another company is then hired to process the data, although this can often be the same company that acquired the survey. Finally the finished seismic volume is delivered to the oil company so that it can be geologically interpreted. While the MEA region counts several fields of computer science and computer engineering, we need to enrich such programs with specialized data interpretation.

3-D seismic mapping, which began to take off in the Gulf of Mexico in the early 1990’s, is often performed by an oil company’s contractors by trailing long hydrophone (a microphone designed to be used underwater for recording or

listening to underwater sound. Most hydrophones are based on a piezoelectric transducer that generates electricity when subjected to a pressure change) cables off of the back of a ship. The cables receive the sound waves when they bounce off the subsurface. Piezoelectricity is the electric charge that accumulates in certain solid materials (such as crystals, certain ceramics) in response to applied mechanical stress. The word piezoelectricity means electricity resulting from pressure. Interpretation of the data is a collaborative process that frequently takes place in theater-like visualization labs where engineers and geologists make critical decisions about which areas are most promising to drill.

1. Basic Manufacturing in Petrochemicals

Petrochemicals refers to an intermediate industry between primary energetic material (fossil fuel, or biomass such as corn, sugar cane or other) and the manufacturing of finished goods such as a variety of plastics, fertilizers, adhesives, paints, pharmaceuticals, automotive, avionics, marine, and the list is endless…

Most MEA countries have a modest plastic industry that makes some of the products we see in the above snapshot from the American Petroleum Institute (API). However these manufacturing operations face a barrier to significant growth as they have to import the raw materials at high cost: a high unit price, comparatively unfavorable discounts on raw material purchase, shipment and port clearing charges, inland road transportation, long time to settle settlements, etcetera…The accumulation of these costs limit the operations of MEA based converters and chemical manufacturers mostly to their own local markets where they compete principally on price and the resulting profit erosion hinders expansions. The aberration is that most suppliers to MEA based manufacturers source their raw materials (solid polymers, powder, or liquid) from European petrochemical manufacturers who import their most essential feedstock and raw materials (crude oil, natural gas) from the MEA!! Because Western petrochemical companies have advanced knowhow; they are capable to process crude oil and natural gas (which they either lack completely or partially) into the raw materials indispensable to MEA manufacturers.

Petrochemical plants, which transform crude oil or natural gas into precious polymers, or chemicals or liquids are the missing link in the oil and gas value chain of the MEA region. Some countries in the MEA have built petrochemical plants and availed intermediate raw materials to their downstream industries but in insufficient product range. The polymers and chemicals and other oil and gas derivatives manufactured in the MEA tend to be of the commodity types, first made in the West ever since the 1960’s. The petrochemical industry has

burgeoned since, and advanced specialty products are needed to complete formula blends by the downstream industry. Specialty products which include primary polymers that impart lighter weight and stronger mechanical properties on the end product, catalysts which accelerate the reaction in a chemical process, surfactants which are compounds that lower the surface tension (or interfacial tension) between two liquids, anti-oxidants that inhibit the oxidation of other molecules; and the list is long, make up a higher percentage of the cost of raw material than they do of the tonnage.

Because regional small and midsize factories are deprived of the specialty polymers they have to import them at high costs. Once they import these specialty grades needed in the blending formula, their sales will be confined to local markets at cutthroat prices, since they could not possibly export their finished goods profitably and sustainably.

a. Steam Cracking:

Steam cracker units are facilities in which a feedstock such as naphtha, liquefied petroleum gas (LPG), ethane, propane or butane is thermally cracked through the use of steam in a bank of pyrolysis furnaces to produce lighter hydrocarbons. Cracking is the process whereby complex organic molecules such as long chain hydrocarbons are broken down into simpler molecules such as light hydrocarbons, by the breaking of carbon-carbon bonds. The term “cracking” is used to describe any type of splitting of molecules under the influence of heat, catalysts and solvents, such as in processes of destructive distillation or pyrolysis (pyrolysis is a thermochemical decomposition of organic material at elevated temperatures in the absence of oxygen).

b. Catalytic Cracking:

A mixture of hydrocarbons with boiling points between 60–200 °C is blended with hydrogen gas and then exposed to a bi-functional platinum chloride or rhenium chloride catalyst at 500–525 °C and pressures ranging from 8–50 atm. Under these conditions, aliphatic hydrocarbons (containing carbon and hydrogen ed together in straight chains, branched trains or non-aromatic rings) form rings and lose hydrogen to become aromatic hydrocarbons (An aromatic compound is an organic molecule containing a benzene ring).

Products obtained from steam cracking and catalytic cracking are the basis for the entire known petrochemical industry and having them means being able to manufacture the vastest gamut of products that define our modern way of life.

4. Gas To Liquids Technology (GTL):

The success of GTL technology means the possibility to obtain precious chemicals once only obtainable from crude oil. This is yet another factor that will reduce the demand on crude oil.

The Fischer–Tropsch process starts with partial oxidation of methane (natural gas) to carbon dioxide, carbon monoxide, hydrogen gas and water. The ratio of carbon monoxide to hydrogen is adjusted using the water gas shift reaction, while the excess carbon dioxide is removed with aqueous solutions. Removing the water yields synthesis gas (syngas made of carbon monoxide and hydrogen) which is chemically reacted over an iron or cobalt catalyst to produce liquid hydrocarbons and other byproducts. Oxygen is provided from a very low temperature air separation unit.

The chemical reaction can be summarized as follows:

CH4 + H2O → CO + 3 H2

CO + H2O → CO2 + H2

2 H2 + CO → CH3OH

CH3OH is methanol which is a raw material to making fertilizers, and olefins such as ethylene, propylene and butene and their derivatives.

5. Polymer Science And Engineering:

In practicality, polymers are solid granules made after a hydrocarbon gas or liquid (like ethylene or propylene or vinyl chloride monomer, or styrene etcetera…), goes into a reactor where one molecule of a compound like ethylene s with another molecule to become polyethylene (PE). Ethylene is polymerized into polyethylene. Propylene is polymerized into polypropylene (PP). Styrene is polymerized into polystyrene (PS) and vinyl chloride monomer is polymerized into Polyvinyl Chloride (PVC). The list is almost endless.

These granules are then processed and transformed under some heat –rarely more than two hundred degrees Celsius- into a final shape: automotive components, or refuse bags, or furniture, or footballs, or food and beverage containers…the list goes on and on…The more science finds out about the chemical properties and physical characteristics (puncture resistance, tensile strength, barrier properties to gases, aromas etcetera…) of hydrocarbon molecules the more technology is able to put these characteristics into practical use to substitute for material costlier to obtain (wood, metal, minerals etcetera…). The science that brings hydrocarbon derivatives into practical use is Polymer Science and Engineering.

Polymer science is a subfield of materials science concerned with polymers, primarily synthetic polymers such as plastics. The field of polymer science includes research in multiple disciplines including chemistry, physics, and engineering.

•This science comprises three main sub-disciplines:

–Polymer chemistry: is concerned with the chemical synthesis and chemical properties of polymers.

–Polymer physics: is concerned with the bulk properties of polymer materials and engineering applications.

–Polymer characterization: is concerned with the analysis of chemical structure and morphology and the determination of physical properties in relation to compositional and structural parameters.

Plastic Polymers are substituting for products across the widest array of applications. Never since the industrial revolution started in 1750, did two molecules such as ethylene and propylene become substitutes for products as different as metals, wood, paper, cardboard, silk, glass, minerals, etcetera…

So much have ethylene and propylene derivatives invaded industries that Polyethylene and Polypropylene (PE and PP) are now traded on the stock exchanges of the world alongside gold, copper and other precious and semiprecious metals. This could be the antecedent of increasing substitution by advanced plastics to even gold in certain application (possibly in dentistry, surgery, and other fields), thus giving lower cost solutions.

6. Conversion Processes in Plastic Industries:

The plastic industry can be very generally categorized in three main processes: Extrusion, injection molding and blow molding. All three processes involve some heat and pressure and the addition in small quantities of crucially important additives: catalysts, tackifiers that regulate stickiness on the surface of the end product, pigments for coloring, elastomers that add elasticity and impart impact resistance, nucleating agents that improve transparency etcetera…While in the MEA there is some manufacture of basic commodity polymers, we lack still the manufacture of both specialty polymers and the precious additives that sell as high as fifty thousand dollars per metric ton.

Some photovoltaic (PV) cell systems are made primarily from raw materials in abundance in the MEA region such as glass (made of silica sand, dolomite, feldspar and other earthy material plentiful in the deserts of the MEA), encapsulated and laminated films made entirely of olefinic derivatives manufactured in the MEA. Only knowhow, education and honed skills stand as barriers for MEA countries to become the world’s manufacturing pool of renewable solar equipment.

The components shown above are mostly the result of an extrusion process: glass is extruded on a horizontal production line after the sand components mentioned above are melted in kiln furnace at temperatures approaching 1,600 degrees Celsius, and the molten material enters a tin bath from which it emerges as glass. The film layers shown are either polyethylene or polypropylene extruded film. There would be every reason to encourage all manufacturers of glass, photovoltaic cells and PE and PP film to close shop in Europe, Japan and South Korea and set up business in the MEA region if only our universities, technical institutes and management training centers prepared our youngsters and young professionals better for industry, and our governments and financial institutions targeted investors for the petrochemical sector.

Elaborating on each of the industrial processes mentioned:

a. Extrusion Process:

Extrusion is the process of making continuous shapes of plastic. Molten polymer is forced through a metal die cut into the linear shape of the desired finished article (channel, tube, etc.). The molten polymer exits the die and is drawn to the appropriate thickness in air. The article is then cooled and shaped by a forming/sizing collar in a water bath under vacuum. Extrusion can be vertical or horizontal. A cooling operation follows which can be through air blowers or quenching into water. Near the finishing and readying of the final product, close control will need to be maintained on the cutting or sawing of the profile into the desired finished length to prevent splitting or shattering. A combination of part reheating and cutter-blade lubrication can significantly improve cut quality. Reheating the part can be accomplished by heated air or water.

Products made with extrusion include all kinds of bags, filaments to weave carpets, utility and specialized high pressure pipes. Thermoforming is an extrusion industrial process. As the name implies, a shape is imparted when heat and pressure are applied to form molten polymers into a final product: utensils, food trays, a variety of other products. What distinguishes a thermoformed item from an extruded refuse bag, or shopping bag is the thickness. A finished film varies in thickness from 120 microns to nearly 200 microns. Beyond 200 microns we are talking about a thermoformed item like a sheet or a membrane. One micron is 1×10−6 m, or one millionth of a meter. A micron’s symbol is: μ, or mu. For example, the diameter of a human hair varies from 17 to 171 μm.

b. Injection Molding:

Injection molding is the most commonly used manufacturing process for the fabrication of plastic parts. A wide variety of products are manufactured using injection molding, which vary greatly in their size, complexity, and application. The injection molding process requires the use of an injection molding machine, raw plastic material, and a mold. The plastic is melted in the injection molding machine and then injected into the mold, where it cools and solidifies into the final part. Injection molding is used to produce thin-walled plastic parts for a wide variety of applications, one of the most common being plastic housings. Plastic housing is a thin-walled enclosure, often requiring many ribs and bosses on the interior. These housings are used in a variety of products including household appliances, consumer electronics, power tools, and as automotive dashboards. Other common thin-walled products include different types of open containers, such as buckets. Injection molding is also used to produce several everyday items such as toothbrushes or small plastic toys. Many medical devices, including valves and syringes, are manufactured using injection molding as well. Rotational Molding is a subpart of injection molding designed to rotate the mold to allow the molten polymer to flow into the intricate and large size shape of the final product through centrifugal force.

c. Blow Molding:

Blow Molding is a manufacturing process by which hollow plastic parts are formed. In general, there are three main types of blow molding: extrusion blow molding, injection blow molding, and injection stretch blow molding. The blow molding process begins with melting down the plastic and forming it into a parison or in the case of injection and injection stretch blow molding (ISB) a preform. The parison is a tube-like piece of plastic with a hole in one end through which compressed air can . The parison is then clamped into a mold and air is blown into it. The air pressure then pushes the plastic out to match the mold. Once the plastic has cooled and hardened the mold opens up and the part is ejected.

d. Thermo-Plastics:

A thermoplastic is a material, usually a plastic polymer, which becomes soft when heated and hard when cooled. Thermoplastic materials can be cooled and heated several times. They can be recycled. When thermoplastics are heated, they melt to a liquid. The polymer chains associate through intermolecular forces, which weaken rapidly with increased temperature, yielding a viscous liquid. Thus, thermoplastics may be reshaped by heating and are typically used to produce parts by various polymer processing techniques such as injection molding, compression molding, calendering, and extrusion. Brittleness can be decreased with the addition of plasticizers, which increases the mobility of amorphous chain segments to effectively lower Tg. Modification of the polymer through copolymerization or through the addition of non-reactive side chains to monomers before polymerization can also lower Tg. Before these techniques were employed, plastic parts in toys, automobiles and so many other finished goods were more prone to breaking.

e. Thermosetting Plastics:

A thermosetting polymer (or plastic), also known as a thermoset, cures irreversibly. The cure may be induced by heat, generally above 200 °C (392 °F), through a chemical reaction, or suitable irradiation. Thermoset materials are usually liquid or malleable prior to curing and designed to be molded into their end form, or used as adhesives. Others are solids like that of the molding compound used in semiconductors and integrated circuits (IC). Once hardened a thermoset resin cannot be reheated and melted to be shaped differently. Thermosetting resin may be contrasted with thermoplastic polymers which are commonly produced in pellets and shaped into their final product form by melting and pressing or injection molding.

7. Software in Integrated Supply Chain Management:

The Oil & Gas value chain, including Petrochemical Plants, mid-size to large plastic converters and chemical manufacturers is run by software, most typically (almost always) SAP: SAP SE Systems, Applications & Products in Data Processing is a German multinational software corporation that makes enterprise software to manage business operations and customer relations. Professionals who are knowledgeable in SAP modules can become consultants either full time or part time, to build the software operational module of the company and run it.

SAP provides a fully integrated system to track down any information instantly from whatever department. It can be integrated with Microsoft office such as excel, word or power point and so many other options. Options can be added for tight control over actions pertaining to any of the operations shown above.

b. Targeting Investments:

While all investments are welcome by countries and communities, we are talking here about sound investments in the energy sector of the MEA and much more importantly targeting the job creating downstream sector of the oil and gas industry made up of petrochemical plants and chemical and plastic manufacturers. Many a reader who is familiar with the MEA environment might snicker while reading the lines that follow, as the author suggests a roap to prosperity entailing a minimum level of genuine commitment and decency on the part of governments in our part of the world, that have been most notorious for the exact opposite.

1. Micro-Generation in The Renewable Sector:

It is possible to invest in small to midsize projects that generate clean energy for self-sufficiency or sale using the net metering scheme. Such initiatives can bring utility bills down, increasing the disposable income as well as create higher value added jobs for university graduates, as well as technicians, software companies etcetera…This is referred to as microgeneration. Microgeneration is the small-scale generation of heat and electric power by individuals, small businesses and communities to meet their own needs, as alternatives or supplements to traditional centralized grid-connected power. Although this may be motivated by practical considerations, such as unreliable grid power or long distance from the electrical grid, the term is mainly used currently for environmentally conscious approaches that aspire to zero or low-carbon footprints or cost reduction.

Depending on the country and resources available, the following renewable investments can be built:

a. Micro-Hydro-Electric Power:

With micro-hydropower no need for expensive dams that might cause the displacement of villagers and unnecessary ecological controversy. Micro hydro is a type of hydroelectric power that typically produces from 5 kW to 100 kW of electricity using the natural flow of water. Installations below 5 kW are called pico-hydro (pico is one trillionth). Small communities and villages along the Nile, the Euphrates, the Tigris, or the Litani could easily derive their electricity from the flow of nearby water that now goes mostly to waste. These installations can provide power to an isolated home or small community, or are sometimes connected to electric power networks, particularly where net metering is offered. There are many of these installations around the world, particularly in developing nations as they can provide an economical source of energy without the purchase of fuel. Micro hydro systems complement solar PV power systems because in many areas, water flow, and thus available hydro power, is highest in the winter when solar energy is at a minimum. Micro hydro is frequently accomplished with a wheel for high head, low flow water supply. The installation is often just a small dammed pool, at the top of a waterfall, with several hundred feet of pipe leading to a small generator housing. In the 1950’s in Lebanon, The Qadisha hydroelectric plant was built in the North of the country, employing locals and contributing to the economic prosperity of the region amidst an undisturbed breathtaking landscape. What is needed throughout water rich countries in the MEA (Egypt, Iraq, Syria, Lebanon) are several updated and more efficient versions of Qadisha.

Such investments at the community level can improve the living standards by contributing to cleaner environments and providing local jobs. What holds for microhydro installations also applies for solar power installations, wind turbines and other renewable sources of energy whose adoption by communities and households is a sustainable stimulant for the economy.

2. Investments in Infrastructure:

Throughout the MEA region and despite incalculable amounts of cash received by some OPEC countries, they still lack the most elementary and basic infrastructure. So should there be a willingness of the part of these countries to start doing what might yield sustainable growth for their economies, they might want start by:

a. Road, Sewage, Power, Municipal Maintenance, Health, Education:

A visit to an MEA country beyond the main roads leading from the airport to the main capital proves the need to rebuild those countries from the ground up. MEA’s population is projected to increase by more than 40% over the next few decades. The region will need to invest over $100 billion a year to maintain existing and create new infrastructure to serve the growing communities and cities across the region. However, falling oil prices, political instability, megacorruption and the cost of military action have significantly curtailed governments’ ability to carry out such basic projects. Despite the colossal hard currency inflows some OPEC countries in the MEA region have been recipient to over the years since the inception of OPEC in 1962, and the absence of essential infrastructure, and in most cases debt ridden governments, the major obstacle to rebuilding infrastructure is lack of money! Yes, the major challenge is financing, where the lack of a sovereign guarantee for the debt these projects must take on is proving a significant challenge. Mitigating and sharing some of these risks through government-backed guarantees can deepen investor confidence. Some governments in the MEA region (including Lebanon!) issued bonds at very high returns with the promise to fund infrastructural projects with returns capable of paying off the bonds’ debt. The projects till now are not built, what infrastructure there was is falling in decrepitude and the bonds’ interests due is secured from tax hikes and more indebtedness.

b. Revamping Existing Crude Oil Refineries & Building New Refineries:

Perhaps a measure of whether an oil rich country has a relatively healthy economy with a burgeoning middle class is reflected in its refining capacity compared to oil production. The USA, United Kingdom, Holland, Italy, Denmark and the list goes on, are all oil producing countries, but their refining capacity is considerably larger than their crude oil production capacity. The same can be said of the natural gas some of them have: they extract its derivatives to provide raw material for their downstream industries. These countries have succeeded in turning the oil and gas industry into engines of economic development. Advanced oil and gas rich countries that have more production than refining capacities are limited to Norway and Canada which both rank consistently in the top five of Transparency International.

In the case of Norway unemployment is at 4.1% in December of 2015 (even lower than in ) and any additional downstream investments to the ones existing could prove redundant, therefore unprofitable.

Canada, with an unemployment rate of 7% in December 2015, could benefit from additional downstream investments but its economic approach prioritizes a welfare state conscious of environmental issues which is considered by the petrochemical industry as rather unfriendly to investments. That can help explain why till now the petrochemical sector of Canada is still largely underdeveloped.

If we contrast the nonexistent crude oil refining capacity of some OPEC countries in Africa and the Middle East to their crude oil production we can conclude why there has not been a petrochemical industry to nurture a beleaguered, misguided and agonizing midget plastic industry.

The forlorn state of the crude oil refining industry of the African countries shown above has made of the abundance of hydrocarbons an engine of economic underdevelopment rather than a precursor to a diversified industry employing educated professionals and enticing investors to build factories. We must emphasize that what refined products are made are intermediate chemicals which are not profitable to manufacture unless they are processed into higher value added finished products. These small unprofitable refining operations serve to supply European, South Korean, Japanese or Chinese based manufacturers who make sophisticated end products (branded sportswear, automotive components, electronic circuitry, laptops, mobile phones etcetera…) which they sell at very high margins all over the world including to the OPEC countries supplying them with bulk raw material. The reader might be shocked to know that some OPEC countries import even car and jet fuel from their crude oil and gas buyers!!!

The existing refineries could be revamped and new ones built to go further down the value chain, empowering local industries and enriching the knowledge of our professionals. Governments must guard against monopolies or cartels emerging as a result of such investments. Each Government could retain equity in each refinery venture and make sure partnering companies are all independent from one another in order to reduce the likelihood of price coordination or fixing between them to the detriment of downstream industries.

If OPEC countries decide to implant and domesticate the knowhow needed to extract and process into finished products the oil and gas derivatives, they would create the opportunity to transfer valuable knowledge from oil and gas companies to Universities’ Colleges of Science, Engineering and other departments as well. This is done throughout the USA, Europe, Japan, China, Singapore etcetera…

c. Natural Gas Exploitation:

A striking –insulting to intelligence- contrast exists between the desolate infrastructure at all levels –roads, sewage, communications, power, education, factories, agriculture etcetera…- in the hinterlands of natural gas exporting countries and the pristine state of the art Liquefied Natural Gas (LNG) export terminals built by powerful multinationals to ensure a steady supply of precious raw materials from the to their operations in the world. LNG export terminals require liquefaction units, storage terminals that are much more expensive to build than basic infrastructure. LNG exporting countries in the MEA region

(particularly in Africa as shown above) are below the poverty line by any measure and rank very low on the list of transparency international. Should OPEC governments want their hydrocarbon wealth to vehicle sustained prosperity instead of civil wars one initiative they could undertake is to build natural gas pipelines serving homes everywhere including remote barren areas. The piping of natural gas is much less expensive than shipping it abroad on specially built vessels since it does not entail liquefaction. Natural gas is piped in the compressed gaseous state. Such an initiative would achieve several desirable objectives:

i- The adoption of natural gas to generate electricity would bring many comparative benefits as compared to crude oil and coal:

a. Much more efficient, and much less wasteful per metric ton than crude oil and coal. b. Much less polluting as can be inferred from the table below. c. The World Bank expects significant savings in billions of USD’s on public

health over 15 years. d. Gas lighter than air: It will evaporate in atmosphere not in the soil or oceans. e. Gas operated plants last longer than fuel operated plants. f. It would bring a source of industrial power to impoverished areas where real estate is presumably very cheap. This could interest investors who pay higher rent costs in the overcentralized and overcrowded cities. Investments in factories in remote areas will empower citizens to earn their living while in their villages and towns and will curb immigration. g. Exploiting natural gas for its derivatives brings with it the possibility of transferring knowledge from major multinational companies to OPEC citizens and emancipating agonizing local downstream industries out of the servility of having to import raw materials from advanced countries in the West and Far East. Such an initiative would unleash the potential of several existing value chains as shown in snapshot below.

d. The Building And Expansions of Petrochemical Plants:

With the noted exception of Gulf Cooperation Council countries, most remaining OPEC countries lack completely this precious and indispensable yet missing link to industrial prosperity in OPEC countries that are Petrochemical Plants. Crude oil is galore in OPEC countries, and ineffective slave-like captive refineries eke out an existence spewing out precious precursors like aromatics, olefins, butadiene and other key products, unprofitable in themselves but key to precious downstream products which are sold back to plastic factories in OPEC countries with a .

The GCC region has forged ahead of other OPEC countries in that regard with several major petrochemical complexes integrated to refineries built.

What is still lacking are plants making specialty products to control key properties in the end product: tackiness, resistance to impact, resistance to puncture and distortions, transparency and so on…

When such plants are built one must guard against monopolies and cartels (oligopolies) that end up condemning the downstream sector to dwarfness.

e. Dedicated Industrial Areas:

Land is plenty throughout the MEA region yet insufficient areas are devoted to chemical and converting industries. Industrial parks could be provided with full utilities (water, power, sewage etcetera…) as well as with silos in order to ensure a reliable supply of raw materials to small and mid-size factories. Such dedicated areas could be integrated to petrochemical plants and refineries and be close to ports to facilitate exports as the case is in countries like Singapore, Taiwan and others.

c. Fighting Corruption:

Easier said than done. Beyond the sloganeering and shaming of reprehensible behavior by civil servants, private companies and individual citizens, one has to submit an action plan which if followed, however imperfectly, could achieve improvements. The author makes these suggestions totally cognizant that even in advanced and prosperous countries, corruption is capable of destroying those who try to expose it or bring to justice politicians and decision makers who accept bribes. In the USA, Murder, Inc. was the name the press gave to organized crime groups in the 1930’s through the 1940’s that acted as the “enforcement arm” of the American Mafia, the early organized crime groups in New York and elsewhere. The USA based Mafia grew so strong and influential that it cooperated with the US State Department on foreign policy missions to remove rulers such as in Cuba and others. In return, the Mafia was given a free hand in certain circles like gambling and other sinful activities and was able to elope prosecution.

In Italy, Aldo Moro while a serving Prime Minister was abducted and assassinated because he dared to apply the law on those who had prospered above it (although many theories exist involving foreign powers opposed to leftist representation in Italy’s government). Countless policemen, ordinary citizens, judges and anonymous decent people throughout the world have been persecuted because they refused to embrace one form or another of corruption. In the lines that follow, the author shall present one possible approach to fighting corruption, while being under no illusion as to the likelihood of it ever being implemented in the public sector.

Fighting corruption involves a cultural turnaround that requires strength of conviction on the part of citizens. A “to do list” must be prepared and it could include:

- Requiring the government to place online as much public transactions as possible: bids, permits, contract awards etc… - Privatization without Cartelization: the avoidance of monopolies and oligopolies is a must. - Eliminate regressive subsidies which take proportionally more money from lower income citizens than it does from those who receive tax payers money for free (General Motors in 2008, for example). - Penalize companies that bribe officials within a country and outside it. - Paying public servants well.

THE END OF THE BOOK.