The Alternative Energy Matrix

[davidstvz]

The author of "Do The Math" has finished his examination of alternative energy sources. Here's the summary conclusion (emphasis mine):

http://physics.ucsd.edu/do-the-math/...energy-matrix/

End of an Era

Not only does this conclude the end of the phase on Do the Math where we evaluate the quantitative and qualitative benefits and challenges of alternatives to fossil fuels, it also points to the fact that we face the end of a golden era of energy. Sure, we managed to make scientific and cultural progress based on energy from animals, slaves, and firewood prior to discovering the fossil fuels. But it was in unlocking our one-time inheritance that we really came into our own. Soon, we will see a yearly decrease in our trust fund dividend, forcing us to either adapt to less or try to fill the gap with replacements. What this post and the series preceding it demonstrates is that we do not have a delightful menu from which to select our future. Most of the options leave a bad taste of one form or the other.


When I first approached the subject of energy in our society, I expected to develop a picture in my mind of our grandiose future, full of alternative energy sources like solar, wind, nuclear, biofuels, geothermal, tidal, etc. What I got instead was something like this matrix: full of inadequacies, difficulties, and show-stoppers. Our success at managing the transition away from fossil fuels while maintaining our current standard of living is far from guaranteed. If such success is our goal, we should realize the scale of the challenge and buckle down now while we still have the resources to develop a costly new infrastructure. Otherwise we get behind the curve, possibly facing unfamiliar chaos, loss of economic confidence, resource wars, and the unforgiving Energy Trap. The other controlled option is to deliberately adjust our lives to require fewer resources, preferably abandoning the growth paradigm at the same time. Can we manage a calm, orderly exit from the building? In either case, the first step is to agree that the building is in trouble. Techno-optimism keeps us from even agreeing on that.

[don]

Re: The Alternative Energy Matrix

with culture wars aplenty . . .

Blown Away

Big Wind’s Inconvenient Truth

by ALAN FARAGO

The installation of wind turbines too close to houses and personal property is a major headache for the wind power industry, but headache scarcely begins to describe their impact to nearby property owners and neighbors. My property and home are scarcely three quarters of a mile from a three 1.5 megawatt turbine wind farm that went online in November 2009 with blades stretching nearly 400 feet into the air.

Large scale wind turbines represent a tiny and lucrative—thanks to federal tax incentives—corner of the electric power industry. By siting large turbine facilities close to population centers, the industry hopes to minimize the cost of expensive new transmission lines, but it faces a whirlwind of resistance from citizens objecting to the destruction of mountains, seascapes, wilderness areas, and natural quiet.

Opponents argue that wind power is a bad deal for everyone but shareholders who use subsidies to prop up an industry that is otherwise not economically viable. But on Vinalhaven, a small island in Penobscot Bay—where only three turbines are in operation—neighbors have opened up the industry’s Achilles heel: excessive noise.

New permit applications in towns across New England are raising hackles of anyone who pays attention to the way citizen dissent has been throttled in Maine where wind warriors mobilized to breach protective legislative barriers erected by the wind industry.

Vinalhaven is a small port town of only a few thousand residents whose primary business is lobstering. During the project’s planning phase in the early 2000’s I understood that my viewscape would change. My neighbors and I wanted to believe the promise of the promoters that our lives would otherwise be unaffected.

As an environmentalist who has often been on the receiving end of the NIMBY argument—opposing ill-advised developments that threaten the Everglades and water quality in Florida—I didn’t want to be part of a movement against wind. Environmentalists can’t wait to jettison hydrocarbons driving our economy, but the lessons of the past three years have tempered my perspective. Wind power is the easiest to seize the popular imagination. It is also the breeziest. There are massive obstacles to bring wind power technology to useful grid scale. Wind is intermittent. Storage of electricity when winds fall is highly problematic. Homeowners and businesses skeptical about noise impacts of wind turbines should revisit sitting on the proverbial fence: if the Maine experience is any guide, NIMBY means that the “next idiot might be you.”

The wind power industry and its local advocates on Vinalhaven insist that turbine noise is an inevitable cost supported by the public. On Vinalhaven, they trumpet that the vote to approve wind turbines was 380 in favor and only 5 against.

Neighbors have spent three years trying to get the State of Maine to enforce its own inadequate noise standards. As a veteran of wars against water pollution, I never expected that a place of solace and respite would prove the point that government can be its own worst scofflaw. It would be one thing if the small size of our community, fad or preference for local control over state or federal mandates, brought closer to resolution a problem that needs to be fixed. Instead of equity and fairness, neighbors are buried in procedural curliques tied to proving violations of state noise standards. We might as well be hog-tied to those spinning wind turbine blades.

Proving noise pollution is no trivial matter. On Vinalhaven, George Baker, a former Harvard Business School professor and executive of the local wind power facility, claims that the noise of the wind turbines is masked by the wind in the trees.

On a summer morning, there is scarcely a whisper of wind in the trees. The sky is blue and the early morning light casts long shadows in anticipation of day. Twenty five years ago I bought my property for its peace and quiet. In the background, the turbines churn like a rotating drum powered by Blakean bellows. What is so distracting is that the quality of sound varies from moment to moment. This is not the noise of a highway, a factory, an airport, or even the noise scape of a city. Turbine noise is as variable as the shifting wind, cementing one’s attention to intermittency like the rotating lights on a police cruiser. That is on the good days.

Neighbors can be woken in the middle of the night with an unidentifiable pounding; it is either in one’s head or chest or the walls of one’s house. From aural flickering to a constant disturbance: either way; having to spend significant time, energy and money to prove the point compounds the despair.

The worst are the hours shrouded in fog that I treasured. They now pulse with turbine noise. The Maine fog associates with a weather pattern—wind shear– that the wind turbine promoters knew about but ignored. They knew because in 2008 their experts told them so. It can be dead still on the ground and hundreds of feet in the air, the wind is howling.Not only did the project supporters omit informing neighbors of wind shear during the permitting phase of the Vinalhaven project, they obstructed discovery of the consultant report and, now, are spending ratepayer resources to contest a legal challenge in state superior court. Their objection: that neighbors do not have a judicial line of appeal. It is incorporated, they say, in a 2008 state energy law that few legislators read much less questioned before passing.

If wind power isn’t economically viable because wind is intermittent by nature, the costs to my life and property are continuous. There is not a single regulation against excessive noise– at the state, local or federal level– to enforce and protect. Given the level of controversy and impact, one would think that industrial wind turbine noise is a public threat where the nation’s environmental agency, the US EPA, ought to engage. But the sole staffer of the EPA’s Office of Noise Abatement retired years ago.

A 2010 petition to the EPA by Maine residents —triggered by the Vinalhaven controversy—implored the agency to involve itself in regulating wind turbine noise. It was rejected by EPA and an administrator who referred petitioners back to the same state regulator in Maine who subsequently resigned after the regulatory effort to tame turbine noise was thwarted by political meddling.

Dead still. So quiet that a conversation can carry a mile. Hundreds of feet above the island, wind shear picks up the turbine blades and hurls them around (The sardonic anthem of turbine advocates on Vinalhaven is “Spin, baby, spin”.) casting sound pulses through moisture heavy air. At other times, sound from the turbines skips like a rock on the surface of a cove.

Think of the sounds from a wind turbine as of a thunderstorm. The noise metric, called the dbA scale, captures the peal of thunderbolts. It fails to capture the low rumble of the storm; the vibration and hum of the turbines. Most wind noise controversies are framed around the dbA level because that is how the industry established the metric for sound in the 1990’s. At nighttime in Maine, for instance, the upper limit is set at 45dbA. For ordinary homeowners, though, to prove 45dbA is more complicated than pointing an acoustic measurement instrument and registering its results. Our neighbor group has chased in the middle of the night, in the middle of the freezing cold, pointing microphones and instrumentation at the pitch black sky in an effort to provide statistics and samples that state-hired consultants will accept. You can’t pick up the phone and complain. You have to pay for tests to prove your complaint. On that playing field, ie. what constitutes a verifiable and legitimate complaint, the goal posts keep moving. So far as low frequency noise is concerned, the goal posts that citizens are trying to reach might as well be on the other side of the world.

Various terms have been used to describe the low frequency sound output of wind turbines: a droning noise or the dreaded thump that alternates or morphs into and out of a woosh. Sometimes, it is like the low sonic end of a spinning dryer. Depending on the wind and direction, the thrum quickens or slows. It can change from the whine of a jet engine to a pulse in the space of seconds. For unfortunate homeowners who live even closer to wind turbines, the effects are mind-blowing. Those who live closest—within half a mile– report their entire dwelling can throb and pulse in time with the swoosh of the turbine blades.

For neighbors in Vinalhaven, learning how to provide data deemed valid by state regulators, including its own consultant, to prove violations by the wind turbine operator (whose shareholders are soundly sleeping, tucked away in their quiet quarters) required learning, spending and acquiring a level of acoustic expertise no homeowner should be required to produce under any circumstances simply to protect themselves. But that is not how it works with industrial pollution.

All neighbors wanted was peace and quiet, and all neighbors have are data files of acoustics measuring turbine noise in the gigabytes. All neighbors wanted was quiet, and all neighbors have is the enmity, indifference, or silence of those who know an injustice was done on Vinalhaven but feel powerless to solve it. The fact that local electric rates on Vinalhaven have significantly increased in recent years while the cost of merchant power in the region has remained stable is an embarrassment of someone else’s riches.

The industry understands that chasing citizens around the dbA scale is a fool’s errand. The Vinalhaven neighbors pursued Maine state regulators up the regulatory ladder from the bottom only to find at the top, that lobbyists pressured the governor’s office to intervene against neighbors on their behalf. There ought to be a law, and indeed there should. It is not exactly an insight to point out that polluters are expert at erecting high legal hurdles to keep citizens at bay. It is a good regulation, in other words, so long as it is one they wrote. The wind industry spends in states where those “should’s” are likely to change the playing field.

Every large law firm in the state is under restrictive agreements with the wind industry. Well-placed lobbyists and shareholders rotate in and out of government office and appointments. The state environmental agency’s top regulator, Patty Aho, is a former lobbyist for the law firm representing the wind turbine utility on Vinalhaven. Aho “did what she was told” by throttling provisions that might have offered hope to Vinalhaven neighbors in future compliance measurement and enforcement. At a July 2011 public hearing at the state capitol on revisions to the state noise regulation—ostensibly to stiffen them to protect people—Aho affirmed that the purpose of regulatory review was to assist industry.

A former governor, Angus King, is a large shareholder of a wind turbine company, First Wind. He wrote in a Maine business publication that he spent last July 4^th on Vinalhaven and didn’t meet a single opponent of the wind turbines. He also didn’t seek the neighbors out. A recent single-question poll by First Wind claimed to measure public support for wind power. A similar poll question, limited to a single question, might solicit the opinion of neighbors who live within three miles of industrial scale wind turbines.

The public is ill-informed about wind turbine noise for a variety of reasons. Usually, a gag order accompanies payment when homeowners are bought out—often after a exhausting, protracted struggle. The industry counters with arguments; wind noise disturbs different people in different ways. The inference is that if you object to noise, you are a complainer in the great scheme of freeing energy tied to oil. In small communities like Vinalhaven, these formulas can be used to great effect, dividing the local population.

In the early phase of permitting the Vinalhaven project, a sound consultant to the project developers wrote tellingly that the site chosen for the wind turbines was likely to generate noise complaints from nearby homeowners and residents. Instead of dealing with property owners up front as the consultant recommended, the wind turbine operator buried the report and hired another consultant. In doing so, Mr. Baker, the former Harvard Business School professor and chief executive of the Vinalhaven turbine operation, made an implicit decision that pit islanders against each other. The result imposed a significant cost on the turbine neighbors; let them fight the state.

Divide and conquer is not the last refuge of polluters but it certainly is a popular one. At a public hearing last July when citizens battled industry on the outline of regulatory reform, a neighbor of a wind turbine installation in another part of the state despaired to me privately– she would not be quoted– that her livestock fences had been cut and garbage dumped in her rural driveway when she spoke out against the turbines in the permitting phase. Now that the turbines roar, her children can’t play in their backyard. The noise is so relentless in her home, another mother testified, that when her children go to bed she asks every night: “Did you brush your teeth, say your prayers, and take your sleeping pills?”

On Vinalhaven, supporters of the wind farm project—goaded by the local utility board and executives—posted a drawing of goat heads in a bucket of blood on a Facebook page, wishing the worst for neighbors who subsequently moved—for health and safety reasons. There are nights when the lobsterman Arthur Farnham, whose home is only seven hundred feet from the nearest turbine, turns his television volume to high, the fans on, and still can’t drown out the noise. It is worst in the winter. But the Harvard Business School professor and turbine operator insisted and the state acquiesced so that wind noise for compliance would only be measured in summer months on Vinalhaven.

Unless you have had something of deep value stripped from you, you don’t understand what the noise does to a fine summer morning on Long Cove or a deep winter night when the noise is roaring in your head or in your house.

The solutions are expensive to polluters. 1) Require fair market price buy-outs or property value guarantees for property owners within two and a half miles of turbines, 2) apply 35 dbA limits to nighttime operations immediately, 3) require the wind turbine industry to pay for the costs of noise monitoring and make all data available through web sites in real time, and 4) develop metrics that capture and regulations that protect against low frequency noise.

As stories pile up of citizens driven from their homes by turbine noise—sometimes health and property values ruined —the absence of effective wind turbine noise standards reflects the quest of polluters and their shareholders to demonize regulations. Shifting the costs of noise pollution has created a new caste of politically connected entrepreneurs who in turn have hired consultants, attorneys and lobbyists to obscure the wind power industry’s most inconvenient truth.

In its brutal outline, regulating noise from wind turbines illustrates the struggle of our times: whether government regulation can protect public health, or, whether private industry should be left alone to do a better job, whether or not it can demonstrate the results. Industry responds by hiding in the deep weeds of “complexity” and “disagreement with interpreting facts”. They buy time for an industry desperate to keep federal subsidies flowing; subsidies set to expire at the end of 2012. The wind power industry hopes Congress and the White House will ignore the fact that people, property values, and natural quiet are collateral damage to popular enthusiasms whose economics have failed to pan out.

We used to say with pride, “this couldn’t happen in the United States”. But wherever the costs of pollution are unallocated, it happens every day the wind blows.

http://www.counterpunch.org/2012/02/...venient-truth/

[dcarrigg]

Re: The Alternative Energy Matrix

I've always been unswayed by these noise arguments. There's one down the road from me. I have friends that live a couple of hundred yards from it. It's not that loud. I've been to the 1.5MW ones too. They're not that loud. If this is too noisy for you, try having kids. Or living in a city or dense town. Or going to a concert (god forbid).

The 45dB level used in the article is not insanely loud. In the house, it will certainly be under 20dB even in the windiest conditions in which it operates. Road noise easily drowns it out completely.

[c1ue]

Re: The Alternative Energy Matrix

At least the UCSD article notes the gigantic missing factor: cost

The missing category here is cost, although difficulty may be an imperfect proxy. As a result, some of the high-scoring options may more be costly than we’d like. Actually, some of the lowest-scoring options are the costliest! If you’re expecting that we’ll replace fossil fuels and do it on the cheap, you might as well learn to bawl on the floor kicking and pounding your fists, tears streaming. This is our predicament. We have to buck up and deal with it, somehow.

The premise that we must drop everything and do something NOW is false, however.

Every single existing convential fuel source today has orders of magnitude of additional availability which will be brought into viability by increased prices.

[charliebrown]

Re: The Alternative Energy Matrix

see my blog about my drive to the Quad Cities. I passed several large scale windfarms. I stopped looked and listened, and I was only a few hundred yards away from the closest one. Not that loud, the noise it did make was a low pitched hum, easy to ignore. I don't know what it would be like hearing it 24/7. As you point out traffic noise is louder, and I would consider it more intrusive from a sound quality perspective. I live a few hundred yards from a major
county artery. I can hear it all the time.

Look, we're running out of fuel, coal and perhaps in a decade nat gas too. Coal is cheap but does have its problems. Either build nukes, use less electricity, or put up these things. There is no nirvana. Everybody talks about conserving, but in mass it is not done.

I thought that wind was getting close to traditional costs if you live in a wind zone.

Mr C1ue, do you know what the cost per kwh is for a turbine in the mid west wind zone? How does it compare to a coal or nat gas fired plant?

[davidstvz]

Re: The Alternative Energy Matrix

At least the UCSD article notes the gigantic missing factor: cost
The premise that we must drop everything and do something NOW is false, however.

Every single existing convential fuel source today has orders of magnitude of additional availability which will be brought into viability by increased prices.

You're talking about non-liquids right? Liquids are set to peak shortly (if they aren't already) which will kick things off. Gas and especially coal will peak later, but it's still worth addressing ahead of time due to the "energy gap trap". At least that's what I thought.

[Starving Steve]

Re: The Alternative Energy Matrix

(atomic power) + ( synthetic oil from coal ) + (hydro-electric power from dams) + ( up-graded oil from tar sands ) + ( oil wells drilled by fracking shale ) + ( deep-sea oil wells as with BP ) + ( traditional oil wells as with wells in shallow water immediately off-shore of Los Angeles ) + ( new oil discoveries as with Stat Oil in the North Sea ) ( cheap and abundant natural gas ) + (conservation) = cheap or moderately-priced oil for hundreds of years to come.

Small atomic reactors can power skyscrapers, universities, hospitals, shopping centres, etc. Large atomic-power plants can power entire cities and entire regions. Atomic power is cheap, uranium is abundant, and atomic-power plants are easy to operate--- as the world has discovered with atomic-powered ships and subs.

Synthetic oil from coal is endless because coal supplies are endless. Fracking allows for oil fields, in North Dakota, in Saskatchewan, in Texas, in Oklahoma, in the Gulf of Mexico, and in the North Sea. Fracking technology opens-up the Earth's almost unlimited supply of oil.

The tar sands of northern Alberta will provide up-graded oil for a century or more. Bitumen in the southern states of Mexico can be up-graded. There is oil offshore of Brazil. There is so much oil in shallow water offshore of Los Angeles that it just leaks out daily and washes ashore onto southern California beaches.

Hydro-electric dams can be built almost everywhere, including on the North Saskatchewan River by Edmonton. Another great place for a hydro-electric dam could be on the Wisconsin River by the Wisconsin Dells in south-western Wisconsin. Even the Mississippi River can be dammed in southern Minnesota. The Eel River in north-western California needs several hydro-electric dams..... The places for hydro-electric dams are everywhere: Egypt has the Nile River. China has the Yangsee River. Brazil has the Amazon River. Europe has the Danube River.

Natural gas is now abundant and very cheap. Nat-gas can be used to fuel power plants and drive electric turbines. Nat-gas is also a clean fuel--- another nice bonus.

Yes, conservation helps keep oil available for hundreds of years to come. But conservation need not, and should not, be the focus of an energy policy or energy plan.

The people of this world do not need to starve. The eco-frauds have totally mis-lead the world..... We have almost unlimited energy resources--- REAL resources that yield far more energy than they require to utilize: including atomic power, hydro-electric power, and fossil fuel resources.

[davidstvz]

Re: The Alternative Energy Matrix

You are very badly informed Steve. Everything you've written is a half-truth at best.

[c1ue]

Re: The Alternative Energy Matrix

Mr C1ue, do you know what the cost per kwh is for a turbine in the mid west wind zone? How does it compare to a coal or nat gas fired plant?

I put up some numbers on Alberta wind farm production some time back - this showed actual load factors to be in the 32.5% range - or roughly 55% higher than what the UK sees and 86% higher than what Germany sees:

http://www.itulip.com/forums/showthr...d-some-numbers

The main item of note is that even for Alberta, despite the extremely high load factor, the wind turbines provide 20% or less of their rated capacity nearly 50% of the time.

As for cost, the Alberta utility (AESO) posts wind contributions and pool prices:
http://www.aeso.ca/downloads/Weekly_..._to_Dec_17.pdf

You'll note that the pool prices for electricity are on average extremely low: below $50 per Mwh or $0.05 per kwh.

Now compare what is paid for wind electricity:

http://zfacts.com/node/244

What really matters is the cost to society. With current subsidy methods, it costs around 3¢/kWh of subsidy to get wind turbines built [2011 update, I'm now hearing from insiders that more like a 5¢/kWh subsidy may be required]. This is because the up-front costs of wind turbines are huge and the payback takes twenty years. Investors require fast paybacks and this "costs" extra. But this is not a social cost. Much of that money is just a transfer to stock-holders. By evaluating a different subsidy method, a more accurate social cost can be found and it is only 1.2¢/kWh.

The above article doesn't speak to the backup required for wind contributions, however, this generally doubles subsidy costs as well.

The above link also explicitly notes wind electricity costs $0.03 more than coal; given the $0.05 pool power cost - this is a pretty big deal.

	One-Time Cost per kW	Capacity (usage) Factor	Fixed Cost per kWh	Variable Cost per kWh	Total Cost per kWh
Gas Turbine	$439	15%	5.2¢	8.7¢	13.9¢
Coal	$1,338	90%	2.7¢	1.9¢	4.5¢
Nuclear	$2,180	90%	4.3¢	0.3¢	4.6¢
Wind	$1,254*	30%	7.5¢	0.0¢	7.5¢

You're talking about non-liquids right? Liquids are set to peak shortly (if they aren't already) which will kick things off. Gas and especially coal will peak later, but it's still worth addressing ahead of time due to the "energy gap trap". At least that's what I thought.

No I'm not.

Cheap Peak liquids is going to peak shortly, but were oil prices to stay consistently above $100, many other forms of liquids become economical: coal to liquids, CNG, oil sands, heavy dirty crude, etc.

The Rutan presentation on climate change includes this graph from the IEA:

iea liquids.jpg

The EIA equivalent graph is much less optimistic on alternative liquids, but then again the EIA assumes oil won't hit $125 until 2035...fairly safe to say this is going to be wildly wrong.

The IEA is probably optimistic on existing oil reserves and recovery, but is probably pessimistic on alternative liquids given the oil price scenarios outlined by iTulip.

[Blindweb]

Re: The Alternative Energy Matrix

newswire_heij_holmgren_1.jpg

The future is either the blue line or the red line. In the long run the upkeep on green-tech is never going to be sustainable. Organic systems are orders of magnitude more efficient and robust than any modern human technology. A horse is orders of magnitude more efficient than an automobile, when you take the whole supply chain into account. Horses need some grass, safety, and some training. A car needs massive supply chains of materials, people, education research. Only tried and robust technologies, like horse saddles and maybe bicycles, are going to be sustainable

The future is organic farming, permaculture, passive solar, local building materials, etc.

[davidstvz]

Re: The Alternative Energy Matrix

No I'm not.

Cheap Peak liquids is going to peak shortly, but were oil prices to stay consistently above $100, many other forms of liquids become economical: coal to liquids, CNG, oil sands, heavy dirty crude, etc.

Just because it gets expensive doesn't mean alternative replacements can be produced at a high rate. Aren't there plenty of secondary factors that will limit the rate and/or utility of alt-liquids? I was never looking at the IEA forecast because, as you say, it is no doubt wrong.

Cost isn't so much a factor as net liquid production. Cost is just a proxy for net production since GDP is oil-transport constrained. I'm no expert, but I've read a lot of convincing analysis which suggests a very rough transition to who knows what. Blindweb's chart sums up what I'm thinking pretty well.

[charliebrown]

Re: The Alternative Energy Matrix

ahh come on mr c1, we have an Arab prince saying they will not let oil go above $100 a barrel. Thanks for your answers.

[charliebrown]

Re: The Alternative Energy Matrix

Mr Steve, I hope you are right. From the sound of things, there may be a lot of fossil energy, but it's not going to be cheap. It is going to be painful when the economy down shifts for energy being increasingly a larger share of GDP.

[lektrode]

Re: The Alternative Energy Matrix

if they werent exporting so much of it, (liquids) it might be a heluva lot cheaper - and might not get too much higher??

ch smith notes that retail deliveries have 'tanked':

http://www.oftwominds.com/blogfeb12/...king02-12.html

Why Is Gasoline Consumption Tanking? (February 10, 2012)


Gasoline deliveries reflect recession and growth. The recent drop in retail gasoline deliveries is signalling a sharp contraction ahead. Mish recently posted some intriguing charts depicting a significant decline in gasoline consumption. Then correspondent Joe R. forwarded me this stunning chart of gasoline retail deliveries, from the U.S. Energy Information Administration: (EIA)

As Joe noted, this data is interesting because it is un-manipulated, that is, it is not "seasonally adjusted" or run through some black-box modifications like so much other government data.
Retail gasoline deliveries, already well below 1980 levels, have absolutely fallen off a cliff. Is the plunge inventory-related, i.e. are storage facilities so full that retailers are simply putting off deliveries?
Though I don't have data on hand to support this, I know from one of my correspondents who is in the gasoline distribution/delivery business that gasoline is very much a "just in time" commodity: gas stations are often close to running out of fuel when they get a delivery. Stations aren't holding huge quantities of surplus gasoline; that's not how the business works.
Given the absence of "extra storage" in gas stations (and the fact that the number of gas stations has fallen dramatically since 1980), it is reasonable to conclude that retail delivery is largely a function of demand, i.e. gasoline consumption.
Even if you dismiss the recent plunge as an outlier, the declines in retail gasoline deliveries are mind-boggling. If you look at the data from 1983 to 2011 on the link above, you will note that delivery declines align with recessions.
For example, deliveries jumped from 50.1 million gallons per day (MGD) in November 1983, when the nation was emerging from the deepest postwar recession then on record, to 58 MGD the following November (1984).
Deliveries steadily rose to a peak of 67.1 MGD in July 1998, declined marginally in the 2001-2 recession and then surged to 66.8 MGD in August 2003. If we just look at one month--say November--then we see that deliveries remained in a remarkably consistent channel from 1994 to 2008, between 54 MGD and 63 MGD, with the higher numbers occuring in the "peak bubble years" of 1998 and 2003.
In 2010, gasoline deliveries declined to the low 40s--literally falling off the charts. In November 1983, deliveries were 51.1 MGD; in November 2010, they were 42.8 MGD, and in November 2011 they were 30.9 MGD.
Does this reflect higher fuel efficiencies in the U.S. vehicle fleet? To examine fuel efficiency and other macro-trends, I assembled some charts of fuel efficiency (courtesy of the Early Warning blog) and a graph of employment, a commonly used proxy for economic activity/growth.
Let's start with some basic data about population and vehicles. There are 254 million passenger vehicles registered in the U.S. Some percentage of these are classic cars and other vehicles that aren't driven much, but nonetheless the number of vehicles that are in regular use is large.
U.S. population in 1983 was approximately 234 million. The U.S. Census Bureau estimates the current population at 313 million.
Vehicle sales declined from a record 17.4 million in 2000 to 11.5 million in 2010.

------

theres quite a bit more to this, 1st seen at ZH:
http://www.zerohedge.com/news/guest-post-why-gasoline-consumption-tanking

but bottom line, he signs off on this one with the comment: lookout below....

and gawd, lets hope prices 'deflate' from here, we already paying upwards/over 4.50/gal on the outer islands!

not that its 'good news' however, as chuck is making the case that we're in recession - meanwhile we've got some interesting contrarian indicators popping up today/this week:

http://blogs.wsj.com/marketbeat/2012...ry-indicators/

Here’s a great chart that landed in MarketBeat’s inbox this morning courtesy of Doug Kass.
With all the bullish and bearish sentiment chatter this week regarding the likes of Nouriel Roubini, Larry Fink, Warren Buffett and David Rosenberg, here’s a look at what some of these bigwigs have been saying over the years and when they’ve been saying it.

http://realmoney.thestreet.com/sites...210roubini.PNG

and then theres this lil beauty - from ole warren yet (who appears to be busy trying to assist obammy in defeating the keystone pipeline to keep his railroad hummin on the coal trade???) - maybe just maybe he's giving a contrarian indicator for gold's direction???

Warren Buffett: Why stocks beat gold and bonds

http://finance.fortune.cnn.com/2012/...holder-letter/

comments???

i know this is somewhat offtopic on this one, but it occurs to me that its all inter-related to alternative energy mix - meanwhile there seems to be action to the upside in the solar sector, all of a sudden? (trina etc bouncing 25% or so this week???)

[c1ue]

Re: The Alternative Energy Matrix

Just because it gets expensive doesn't mean alternative replacements can be produced at a high rate. Aren't there plenty of secondary factors that will limit the rate and/or utility of alt-liquids? I was never looking at the IEA forecast because, as you say, it is no doubt wrong.

I'm not sure what you mean by 'can be produced at a high rate'.

A coal to liquids plant costs around $500 million dollars and would produce 50000 barrels per day output for 14 million tons of annual coal input, and would be profitable at $60/barrel.

The US in 2010 produced roughly 1080 million tons of coal. US coal reserve numbers are not very rigorous, but there are 18000 million tons at existing mines with at least 20 times that number in surveyed deposits.

US oil imports are in the range of 11 million barrels per day; it would require 220 CTL plants to completely replace all foreign imports which is unlikely in the short term.

However, Persian Gulf imports are 2 million barrels/day, with Canada contributing 2.5 million and Mexico 1.2 million barrels/day. To put this in context, Saudi Arabia contributes 1.1 million barrels/day.

Thus to replace Persian Gulf oil would only require 40 CTL plants, while all of OPEC imports are 4.9 million barrels/day = 100 CTL plants.

100 CTL plants would cost $50 billion dollars with infrastructure add ons likely doubling this.

To put this in perspective, in just 2007 wind electricity capacity building in the US was $9 billion which replaced exactly nothing.

Cost isn't so much a factor as net liquid production. Cost is just a proxy for net production since GDP is oil-transport constrained.

I am unclear as to what you're trying to say. If the US government guaranteed CTL plants as has been done with wind electricity and solar, I guarantee the capacity would spring up extremely quickly.

As for net production - that is exactly the point of cost. CTL is completely uncompetitive with oil at $40 because the input cost of coal vs. the output hydrocarbons yield a liquid fuel which is more expensive. As oil prices escalate, the CTL output become competitive.

Again, I'm not saying this is how events will unfold.

But to say there are no options is false. There are all sorts of options - the question is which will be chosen and how they will be implemented.

So far the US response to its oil transport dilemma has been to shovel money on largely irrelevant first generation alternative energy electricity production. Easily $50 billion dollars has been spent already on wind, solar PV, ethanol, and what not.