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The real cost of fossil fuels / Mason Inman

Alberta oil sands development. Photo: shutterstock
Alberta oil sands development. Photo: shutterstock

Canada's tar sands project Covering 600 square kilometers in northeastern Alberta. The Prime Minister of Canada, Stephen Harper, called the industrial effort to extract oil from these sand deposits "an enterprise on an epic scale like building the pyramids or the Great Wall of China - only bigger."

At a time when traditional oil and natural gas reserves are becoming increasingly difficult to find, and at a time when the demand for energy is increasing, energy companies are turning to unconventional resources, including tar sand, which are more difficult and expensive to exploit. The amount of oil extracted from bituminous sand in the world, for example, has increased threefold in the last decade, and in 2011 it stood at 1.6 million barrels per day.

Assuming that there is a need for new oil resources, which ones should be exploited? A great deal of energy is needed to extract the energy from these resources, whether it is bituminous sand, natural gas extracted from oil shale by hydraulic fracturing (fracking), or old oil deposits that can be flooded with steam to extract more oil from them. To help compare different fuel sources according to a common standard, ecologist Charles A. S. Hall of the SUNY College of Environmental Sciences and Forestry invented an estimate called energy yield (EROI). The energy yield of a fuel is the ratio between the amount of energy it provides and the amount of energy required to produce it. The higher the yield, the more energy is available. On the opposite page and the following pages I will review the inputs and outputs of several types of fuel and explain their EROI.

"Energy returns are diminishing everywhere," Hall says of gas and oil. His model shows that a modern economy needs a liquid fuel with an EROI of at least five; As the yield decreases, society spends more on energy, and these costs begin to eat into funds that would have been used for other things, such as education, health or entertainment.

According to this criterion, there are not many magical options in the transportation industry. However, low EROI fuels are increasingly needed to meet growing demand, the International Energy Agency (IEA) states. Even now, the IEA warns, oil prices are only slightly above the "red line" and weigh on economic growth. The power plants enjoy a higher EROI because they can utilize more common resources.

The estimate of the energy yield does not evaluate all the advantages and disadvantages of the fuel. And in particular, it does not take into account environmental costs associated with the emission of greenhouse gases nor supply problems, such as discontinuity of the wind or solar radiation. Still, the EROI makes it possible to estimate the amount of energy that can be expected from each source. It can also clarify how efforts to reduce pollution, such as capturing carbon dioxide emitted from coal-fired power plants, can dramatically change the economic viability of using a particular fuel. When you measure the energy invested versus the energy produced, it is possible to channel the investments to sources that most effectively maintain the proper functioning of the economy and can help build a sustainable future.


About the author

Mason Inman is a freelance journalist from Oakland, California. These days he is writing the life history of the geologist M. King Hubbert, the father of the theory of peak oil production.

Credit: Oliver Munday

Credit: Jen Christiansen

More on the subject

Revisiting the Limits to Growth after Peak Oil. Charles AS Hall and John W. Day in American Scientist, Vol. 97, no. 3, pages 230–237; May-June 2009.

New Studies in EROI (Energy Return on Investment). Edited by Doug Hansen and Charles AS Hall. Special issue of Sustainability, Vol. 3; 2011.

Energy and the Wealth of Nations. Charles AS Hall and Kent A. Klitgaard. Springer, 2012.

More of the topic in Hayadan:

4 תגובות

  1. There are many parameters besides forms of storage. For example, we don't know how to run cars on coal, so we have to use electricity if we want, and that means a loss of energy along the way. There are aspects of safety and compactness and more. Energy return is probably the most important measure when talking about long-term aspects of viability and the future of energy.

    The viability depends very much on the limits of the system. For example, the inputs indicated here for sugar cane and additional biofuel do not include inputs of chemical fertilizer and pesticides. These include natural gas for the production of ammonia, oil for pesticides, and the production of potash and phosphate, both of which are energy-intensive substances. Nuclear reactors do not usually include in their energy return things like cleaning the nuclear reactor and maintaining the nuclear waste (for hundreds of years to millions of years) and oil and gas do not include the costs of wars, leaks, etc., and the costs of coal obviously do not include problems it entails such as warming and pollution .

    The efficiency is a ratio that teaches us much more than the ratio of cost benefit in production and economic cost (cost in dollars per unit of energy) because this can contain various subsidies for the price and also contain the common illusion that energy will simply become more expensive - so we will use it less. While energy return analysis yields completely different things. For a sample in a ratio of 1-1 we actually lose energy in production. While the price in dollars is much more volatile and depends on things like past investments in infrastructure, disputes, speculation on future contracts, etc. First one must understand the mechanism of energy return and only then deal with the other questions.

  2. I have seen, I simply point out that in reality it is impossible to omit it, and that the real ratio that needs to be looked at is the economic ratio - the cost of production versus the electricity generated.

  3. to another one. Note in the notes that the energy storage cost was not taken into account.

  4. Energy ratio is an important thing - especially when talking about renewable sources - but the form of storage is also very important.
    There are systems with an energy ratio less than one - electrical energy storage systems that are charged during low usage hours and discharged during peak hours (for example, pumping water to an upper reservoir and using it in a hydroelectric system).

    I find it hard to believe that wind is so energetically efficient. Where does the data come from?
    Secondly, there is the issue of the amount of energy produced - hydroelectric energy may be very efficient, but you cannot exactly build a dam wherever you want.
    The right way to look at it is from the economic angle - the cost in dollars (or shekels) per gigawatt hour.
    This is the most logical way to measure both the workforce and the energy invested -
    The pollution damages can also be included in the cost calculations.

    It's good to see on this site an admission that corn ethanol is a terrible mistake - with an energy ratio of 1.4 the project to starve the world and subsidizing corn growers should go through the world.

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