The Solution to US dependency on imports
Great chapter Chris! I love it but as someone who has prescribed to your overall conclusions of ‘What to do’ now that the truth is being exposed, I have to raise one other possibility. The reason why I decided to get into the Natural Gas Storage business is because we have developed models that examine the value of Daily Deliverability of natural gas in the US versus the amount of overall storage capacity. If you’d like material for another chapter, this will truly amaze you.Anyways, one possibility we have examined is the ability for the US to substitute it’s largest use of oil into another more efficient and cleaner fuel- Natural Gas. Transportation as you have outlined, is the largest user of oil and the overall energy cost to refine oil into usable gasoline is also quite intensive. So how do we convert this energy substitution into something that powers cars? The answer is the electric car. Batteries and commercial cars (Tesla.com) have already commercialized cars that can travel 200 miles in a single charge and the charge time is less than 15 minutes (another battery company has developed this technology). Not only is the oil/gas ratio at a whopping 15x, this phenomenon has only been around for the past 2 years.
I know, I’m still missing a step… how does using natural gas create power for electric cars? There hasn’t been a newly built coal fired power generation facility in many years and for good cause… and now take a look at the pricing mechanics. For the first time, we may see price be the reason behind a substitution of coal to generate power. There is still excess natural gas powered generation but if we ever move to powering our cars with electricity, the demand for refiners will fall and the demand for natgas fired power generation will increase. However, think of all the savings in this process- savings on not having to spend energy refining the oil to gasoline, the energy gap between the 6:1 ratio of oil and gas versus the 15x current pricing implies.
This new demand will put incredible strain on the daily deliverability for natural gas and we know of a few solutions of which I’d be more than happy to discuss this with you on. But I’d be curious to see what your numbers look like when you substitute natural gas to satisfy our transportation needs. Yes, it will take some time but not as much as you’d think. It’s not like we need to build special stations to charge cars like the problem with the hydrogen car solution… the power infrastructure in the US is amazing. It will also lower the volatility of gas demand and prices since the combined ‘battery’ power of these millions of electric cars will actually provide a source of power during peak demand times. For example, when you drive home from work, you can plug in your car to your house/grid and give back energy during 6-8pm and recharge again at 2am when prices/demand of power is low.
There are lots of implications to all this but if you or any of your readers would like to discuss this more, I’d be more than happy to chat.
(p.s. for some reason I can’t put spaces in my comments so that’s why it is in one big block)