Terrestrial Renewable Energy
And Biofuels
Alfred J. Cavallo
US DHS EML
201 Varick St, 5
th
Floor
New York, NY 10014
PROPOSAL:
A Modern Industrial Society
Can Be Fully Powered
Using
Terrestrial Renewable Resources
Renewable Resource Base
• Immense: for example
• US Wind resource equivalent to 5-10x
current average electric consumption
• US agricultural land sufficient to yield
liquid fuels to power fuel-efficient
transportation fleet
• Solar thermal/PV resource large
Most Promising Renewables
• Wind
– Excellent technology; 30 GW Installed
– Moving Offshore in Europe
• Solar Thermal
– Luz Parabolic Concentrators Proven
• Biofuels
– Brazilian Ethanol Program
Renewable Energy Not Taken Seriously:
By Utilities, By Oil Companies
By Renewable energy advocates
Challenges:
Technical (Transmission, Storage)
Externalities do not count
Relative Profits (liquid fuels especially)
APPROACH
Renewable Energy (electricity, fuel)
MUST be:
• Affordable (not necessarily cheap)
• Technically equivalent to other
competitors
• Profitable for manufacturers, utilities
(Necessary but not sufficient)
BIOFUELS
• Ethanol from corn (US farm subsidy)
• Biomass to Syngas to fuels
Biomass+O
2
-> CO+nH
2
+heat
CO+mH
2
->(catalyst, FT process) Fuels
(similar to GTL process for monetizing
stranded natural gas)
• Ethanol and Methanol from non-corn crops
(energy crops, agricultural waste)
Example: Brazil
• Successful program to produce ethanol from
sugarcane
• Cost is the same as gasoline (boe)
BUT:
Production flat over past decade
Petroleum Consumption up 40%
Production x2
WHY??
NEWS FLASH
• London, June 26 - The Beyond Petroleum
Company (aka BP) today signed a formal
agreement to invest $6.15 billion in a joint
venture to produce biofuels in Russia.
• The political importance of the deal was
underscored by the appearance of Prime
Minister Tony Blair and President Putin at a
biofuels conference here today.
UNDERSTAND THE MARKETS
How profitable is this business?
"Non-OPEC finding and development
costs dropped from $22/bbl in 1981 to
$6/bbl in 2001 (2001$)."
E. Baird, President and CEO,
Schlumberger Ltd.
Fossil Fuels, The Key to Sustainable Development,
World Energy, 2003, Vol 6, 1, 34-41.
Wind Turbine Technology
• 30,000 MW Installed ($30 Billion)
• Produced on assembly lines in large
factories
• Highly competitive
• European private enterprise R&D
• Excellent reliability
• 4.5 MW machines under development
Compressed Air Energy Storage
(CAES)
• Proven technology; existing plants
• Gas Turbine (simple, inexpensive)
• Underground Storage (invisible)
• 3D Seismography
• Porous rock, solution mined caverns
• Suitable geology widely available
• Seasonal Storage economical
CAES
• About 65% of gas turbine output used to
compress air at inlet to combustor
• Compressed air stored underground,
eliminating need to compress air.
• World’s best kept secret energy storage
technology.
Mechanics of CAES – background
Natural Gas
12,000 BTU/kWh
Mechanics of CAES – generation
Natural Gas
3,800
BTU/kWh
Utility Wind/CAES Systems
• Wind generated electricity most economical
renewable energy.
• Capacity factor designed to produce lowest
local cost of electricity (0.3).
• Capacity factor can be (0.5) for 10%
increase in local COE.
• Baseload Wind/CAES with transmission for
10-15% increase in delivered COE.
Iowa Wind/CAES Project
• Project Template
– Demonstration Project
– Public private partnership
– Special appropriation (earmark) outside of
normal channels through Congressional
Delegation
IOWA WIND/CAES Plant
Glacial Drift
Devonian Carbonates
Maquoketa Shale
Galena
Decorah
-
Platteville
St. Peter (Storage Zone)
Prairie Du
Chein
Jordan
Eau Clair Sand & Shale
Mt. Simon Sandstone
Glacial Drift
Devonian Carbonates
Maquoketa Shale
Galena
Decorah
-
Platteville
St. Peter (Storage Zone)
Prairie Du
Chein
Jordan
Eau Clair Sand & Shale
Mt. Simon Sandstone
Electric Power
Substation at CAES
Power Plant
161 kV Transmission Line
to Webster Substation for
Delivery of Power to
Utility Grid
Injection wells to
aquifer strata
Compressed air bubble
Ground Level
100-200 MW
CAES Power
Plant
Natural Gas
Pipeline to
Pressure Regulation
Equipment & Pipeline
Underground and overhead
24 kV collection circuits
for delivering wind power
directly to CAES substation
Diagram of Proposed
Wind – CAES Power Plant
Near Fort Dodge, Iowa
TAW 12 / 3 / 2002
Compressed Natural
Gas bubble
25 - 400 MW
Wind Generation
The St. Peter
Aquifer can be
used for storing
both
compressed air
and natural gas.
Due to the
shape of the
aquifer, about 8
BCF of
compressed air
and 2 BCF of
natural gas
could be stored
in the same
aquifer.
Compressed Air Natural Gas
St. Peter Aquifer
470 PSIA, 30 BCF
Jordon Aquifer
632 PSIA, 4 BCF
Franconia Aquifer
750 PSIA, 26 BCF
Eau Claire Aquifer
777 PSIA, 16.6 BCF
Eau Claire Mt. Simon
825 PSIA, 26 BCF
Comparison of Installation and Operation Cost
Installation Operating Cost Delivered
Cost Fixed Dispatch Cost of
Costs Costs Energy
$ / kW $/kW-Yr $ / Mwh $ / Mwh
200 MW CAES Plant, No
Wind
$625 $22 $27.5
$57 at
28% C.F.
200 MW Simple Cycle
Combustion Turbine
$400 $10 $55.0
$76 at
28% C.F.
250 MW Combined Cycle
Plant
$575 $20 $29.0
$57 at
28% C.F.
New Coal Unit Operated at
Intermediate CF
$1,700 $15 $10.0
$68 at
28% CF
200 MW CAES + 400 MW
Wind Plant
$2,200 Levelized Cost =
$38 at
75% CF
New Coal Unit at Base Load
CF
$1,700 Levelized Cost =
$34 at
75% CF
New Coal Unit at Base Load
CF with Climate Change
$1,700 Levelized Cost =
$43 at
75% CF
Based on $4.00 per MMBTU Gas Price, $12.5/Mwh off-peak energy for
charging CAES, climate change adder is $15/ton of CO2, Green tag
revenue of $5/Mwh
Other revenue offsets
• Ancillary service revenue potential (examples)
– Regulation = ± 2.50/MWH (Cal. ISO 9/98 – 9/99)
– Spinning reserves = $6.23/MWH (Cal. ISO 9/98 –
9/99)
• Green tag value ± $5/MWH
Status of Iowa Project
• Iowa Association of Municipal Utilities has
raised internally and spent over $600k to
investigate the concept.
• 3D Seismology of Storage Structures
complete.
• Decision to proceed in August.
Conclusions
• Renewable resources (intermittent and biomass)
can provide electricity and fuels that are:
– Affordable
– Technically competitive
– Profitable
Significant barriers remain:
Cannot hope to match profitability of competing systems
