Environment us clean Air Acts

Clean Air Acts of 1967 and 1970

Amendments to Clean Air Act in 1967 divided the nation into Air Quality Control Regions (AQCRs) to monitor air quality. AQCRs that met or exceeded Clean Air Act standards were designated attainment areas, whereas those that did not were designated nonattainment areas requiring special attention. Enforcement of pollution standards was primarily carried out by the various states’ environmental agencies. Each state developed a state implementation plan (SIP) that outlined how it would enforce compliance with pollution standards set forth in the Clean Air Act. Although states had the right to set tougher standards than those imposed by the Act, they were obligated to meet its minimum standards. EPA approved each SIP and had the right to take over enforcement if SIP was unacceptable. Issuing of environmental permits under the Clean Air Act included information on type and quantity of pollutants being released, how they were being monitored, and what steps were being taken to reduce pollution. EPA did not specify how to reduce pollution, but required that Maximum Available Control Technology (MACT), later changed to Best Available Control Technology (BACT) by the 1990 Act, be used to ensure an effective means of pollution abatement.

The Clean Air Act of 1970 described itself as “an Act to amend the Clean Air Act to provide for a more effective program to improve the quality of the Nation’s air” and was an essential rewrite of the previous Act. The Act established National Ambient Air Quality Standards (NAAQS) for cited pollutants and also included New Source Performance Standards (NSPS) that strictly regulated emissions from new factories, including electricity generating and other industrial plants. The Act set standards for hazardous emissions and gave individuals the right to take legal action against any organization, including the government, for violating emissions standards.

Rather than set guidelines that were normally not complied with as in previous Clean Air Acts, the 1970 Act required EPA to perform compliance tests, enforce performance warranties from manufacturers, and impose a per vehicle fine for those that did not meet Clean Air Act standards. The 1977 amendments to the Act established a policy of Prevention of Significant Deterioration (PSD), which defined areas such as national parks where there would be a general prohibition from doing anything that would result in significant deterioration of the environment. A long string of amendments, or EPA-granted extensions, was necessary to give motor vehicle manufacturers time to comply with emission standards. In the meantime lead was removed from gasoline. Oil refiners had to invest in refinery improvements to produce a lead-free gasoline whose performance standards were similar to leaded gasoline and to meet lower sulfur specifications imposed on gasoline and diesel fuel. Diesel engine manufacturers had to build engines that cut particulate emissions. These additional costs borne by industry were eventually passed on to consumers as higher prices.

Clean Air Act of 1990

Congress once again drastically amended the 1970 Clean Air Act in 1990, which described itself as “an Act to amend the Clean Air Act to provide for attainment and maintenance of health protective national ambient air quality standards, and for other purposes.” The 1990 Clean Air Act differed from its predecessors by internalizing an externality. The externality was environmental degradation, which affected everyone. Internalizing made environmental degradation a cost directed at those responsible for pollution emissions. Once a cost is placed on pollution, whether in the form of acquiring allowances that permit pollution emissions or as a direct tax, industry then had an economic incentive to do something about reducing pollution. The process for internalizing an externality—reduction of sulfur dioxide emissions—set up by the 1990 Clean Air Act has been adopted by the Kyoto Protocol as a primary means of reducing greenhouse gas emissions.

The Act recognized that pollution in many metropolitan areas could not be restricted to a single state. People live in one state and work in another. Trucks frequently pass over state borders. Thus air pollution from motor vehicles cannot be handled under a single state jurisdiction when cars and trucks spread pollution throughout an entire metropolitan region. The 1990 Act set up interstate commissions responsible for developing regional strategies to clean up the air. Pollution crossing the national borders in either direction between the US, Mexico, and Canada was addressed in a special annex to the North America Free Trade Agreement (NAFTA). The Act mandated that all power plants had to install continuous emission monitoring systems (CEMS) to keep track of sulfur and nitrous oxide (SOx and NOx) emissions. Pollution permits required every power and industrial plant to specify a schedule for meeting emission standards.

The 1990 Clean Air Act introduced reformulated and oxygenated gasoline. Reformulated gasoline combats smog by emitting a lower level of VOCs that mix with nitrous oxides to form ozone, the primary ingredient in smog. Oxygenated gasoline burns more completely, particularly during engine startup in cold weather, reducing carbon monoxide emissions. Reformulated and/or oxygenated gasolines were required for certain nonattainment areas of the nation that suffer from high levels of ozone and/or carbon monoxide pollution for particular periods of the year. As described in Chapter 3, the Energy Policy Act of 2005 substituted a minimum quantity of ethanol in the gasoline stream to meet the oxygenate requirement contained in the 1990 Clean Air Act.

The 1990 Act contained mandatory reductions in sulfur emissions on a timetable that permitted industry to adapt to the new standards in an orderly fashion. A cap was established on aggregate sulfur emissions that stepped down in time. This cap became a maximum allowance or limit for the principal sulfur dioxide emitters. Reducing sulfur emissions on an individual company basis can be done in a number of ways. One way was for a sulfur emitter to buy a rundown, outmoded, inefficient, obsolete, cheap, sulfur-emitting smoker in order to establish its baseline for sulfur emissions, then shut the plant down, thereby fulfilling its sulfur reduction obligation. A more prevalent way by utilities in Midwest and Northeast was to switch from high sulfur Appalachian coal to low sulfur western coal. This caused low sulfur coal prices to rise in relation to high sulfur coal prices, establishing a price differential, which, if wide enough, provided an economic justification to install scrubbers. Scrubbers removed sulfur in exhaust fumes and enabled a plant to burn cheap high sulfur coal while keeping within mandated sulfur emission allowances. Retiring old coal fired plants and replacing them with clean burning natural gas plants, or with renewable solar and wind power sources, were other ways for an industrial concern or utility to reduce sulfur emissions.

Cross-State Air Pollution Rule

In 2011, EPA issued the final ruling on the Cross-State Air Pollution Rule (CSAPR) to reduce air pollution that moves across state boundaries that contribute to ozone and fine particle pollution. CSAPR applies to 28 states, covering nearly every state east of the Mississippi where this type of pollution is prevalent. When fully implemented in 2015, CSAPR will reduce sulfur dioxide emissions by 74 percent and nitrogen oxides by 54 percent from 2005 levels. Reducing nitrous oxides is a greater technical challenge than removing sulfur oxides. Sulfur is removed as an impurity from gasoline and diesel fuel in a chemical process during refining and is now barely present in motor vehicle fuels. It is also removed from coal after combustion by scrubbers in a chemical process before smokestack fumes are released to the atmosphere. Nitrogen is not an impurity that can be removed separately; it is part of the molecular structure of fossil fuels. Nitrous oxides (NOx) are mainly a product of combustion where oxygen in air unites with nitrogen atoms in fuel. NOx can be reduced by a physical process associated with design of burner tips and boilers/furnaces for combusting coal and natural gas. NOx are also produced by motor vehicle fuels and are difficult to reduce other than redesigning conditions surrounding the ignition process. Reducing SOX and NOX are anticipated to yield health benefits of $120–$280 billion, far in excess of the $800 million annual cost of the CSAPR program.²

Mercury contamination harms the central nervous and reproductive systems of adults. Pregnant mothers eating mercury-laden fish have a greater risk of bearing children with brain disorders and learning disabilities. Largest source (46 percent) of mercury is coal burning power plants. Other anthropomorphic mercury sources are metal production excluding gold (10 percent), cement making (10 percent), gold mining (24 percent), with the remainder centered on chlor-alkali industry, waste incineration, and dental amalgam.³ Regulation on mercury, arsenic and other metallic (nickel, chromium) emissions are contained in Mercury and Air Toxics Standards (MATS), whose final ruling was issued in 2015. Power plant emissions of mercury is expected to be cut by 90 percent, acid gas emissions by 88 percent, and sulfur dioxide emissions by a further 41 percent beyond that contained in the Cross-State Air Pollution Rule.⁴

Sulfur in Diesel Fuel

The Clean Air Act of 2004 called for a reduction of diesel sulfur content from 3,000 ppm to 500 ppm. In 2006, EPA issued rules that resulted in highway diesel trucks switching over to ultra low sulfur content diesel of 15 ppm by 2010. Low sulfur (500 ppm) and ultra low sulfur (15 ppm) were phased in between 2007 and 2014 for nonroad diesels, locomotives, and certain classes of marine engines.⁵ Sulfur reduction in diesel fuel has to be considered an ambitious and successful program from a starting point of 3,000 ppm in 2004 to an ending point of 15 ppm only 6 years later for highway diesel engines. This reduction required close collaboration with diesel engine manufacturers and oil refinery operators.

Climate Change Conferences

The United Nations Framework Convention on Climate Change (UNFCC) was signed in 1992 and subsequently ratified by 184 nations. These nations agreed to work together to stabilize concentrations of greenhouse gases in the atmosphere at a level to prevent dangerous human-induced interference with the global climate system. The primary mechanism of carrying out this mission is the UNFCC’s 1997 Kyoto Protocol that sets forth steps to reduce greenhouse gas emissions from 2008 to 2012. In 2007, the Intergovernmental Panel of Climate Change (IPCC) published its Fourth Assessment Report, which gave a clear signal that climate change is accelerating caused primarily by anthropogenic greenhouse gas emissions. This led to the Climate Change Conference in Bali where developed and developing nations agreed to step up their efforts to combat climate change promulgated in the Bali Road Map, which included a long-term cooperative action plan to be defined at the 2009 Climate Change Conference in Copenhagen.⁶ The overall mission of the Copenhagen Climate Change Conference was to agree on a plan to stabilize greenhouse gas levels with 2020 and 2050 emissions reduction targets; delineate an effective means of measuring, reporting, and verifying emissions performance; provide incentives for a dramatic increase in financing deployment and development of low emissions technologies; and provide a means to finance forest protection.

After the Copenhagen Climate Change Conference, International Energy Agency (IEA) analyzed two proposals called the 450 and 550 Policy Scenarios where carbon dioxide concentration, then at 387 ppm, would level off at either 450 or 550 ppm by 2020. Both these policies called for draconian and immediate action to succeed involving major changes in power production away from coal, except for IGCC plants, with a major emphasis on nuclear, hydro, biomass, wind, solar, and geothermal energy sources. Besides power plants, energy intensive industrial sectors such as iron and steel, cement, aluminum, paper and pulp should be encouraged to use the best available technology to cut emissions. Aircraft engines should be redesigned to reduce fuel requirements, and hybrid electric and pure electric motor vehicles favored over fossil fuel vehicles. The analysis concluded that energy efficiency and conservation would have important roles to play to reduce carbon dioxide levels. It also advocated a cap and trade program on carbon emissions to provide an economic benefit along with Clean Development Mechanism (CDM) to provide less costly equivalent means of reducing carbon emissions.

The critical fault in the Kyoto Protocol was not addressed satisfactorily by the Copenhagen Conference—that of developing nations excusing themselves from participation because of the fact that buildup in carbon dioxide was primarily caused by industrialized powers. Though true, it begs the question as to the role that the developing world is now playing in contributing to greenhouse gas emissions. For China and other rapidly growing greenhouse gas emitters such as India, Brazil, and Mexico to be excluded from any solution on greenhouse gas emissions borders on the ludicrous. China has been vocal in the past of not having carbon emissions standards imposed on developing nations. China advanced a tentative plan to reduce carbon dioxide emissions per unit of GDP activity, but not in absolute terms. China’s willingness to even talk about carbon dioxide emissions may be in response not just to public pressure, but to China’s emerging role of becoming the largest global investor and manufacturer of clean energy technology. Copenhagen Conference ended on a sour note with the US insisting on transparency and verification and with China resisting what it considers intrusions on its national sovereignty.

Bonn and Tianjin Climate Change Conferences in 2010 were in preparation for the Cancun Climate Change Conference late in 2010 (at the peak of the tourist season). Cancun Conference agreed to a maximum 2°C rise above pre-industrial levels, to operationalize a technology mechanism to boost innovation in climate-friendly technologies, to aid in nations adapting to climate change through an Adaption Committee, and to establish a Green Climate Fund. Green Climate Fund would receive funding of $30 billion to be spent on various projects in the developing world with initial emphasis on forestry projects.⁷ By end 2014, funding was still short of expectations on the $10 billion goal by 2015.⁸ At that time, the US pledged $3 billion and Japan $1.5 billion to bring the total funding to $7.5 billion, still short of the goal.⁹

Bangkok and Bonn and Panama Climate Change Conferences in 2011 concentrated in activating agreed plans at the Cancun Conference, refining Kyoto Protocol for wider participation in mitigating greenhouse gas buildup, and preparing for the climate conference in Durbin. Climate Change Conference in Durbin late in 2011 reaffirmed findings of the Copenhagen Conference with regard to a second commitment to the Kyoto Protocol and establishment of the Green Climate Fund. In 2012 preparatory climate conferences were held at Bonn and Bangkok for another conference to be held at Durbin in late 2012. Durbin Climate Change Conference completed the second commitment to the Kyoto Protocol noting the unsatisfactory situation of not all nations taking action to mitigate greenhouse gas emissions. Lima Climate Change Conference in late 2014 was preceded by three conferences at Bonn and one at Warsaw. Lima Conference secured pledges to take the Green Climate Fund beyond $10 billion, several industrialized nations agreed to be more transparent about their emission targets via a Multilateral Assessment, and a call on governments to put climate change into school curricula and national development plans. Lima Conference also laid the groundwork for a major Climate Change Conference to be held in Paris late in 2015 that will try to rectify the major failure of the Kyoto Protocol to be expanded to include all nations. With regard to public issuance of emission targets, Presidents Obama of the US and Xi Jinping of China announced in late 2014 their goals to keep global temperature from exceeding a rise of 2℃. The US target would be to reduce its emissions by 26–28 percent below its 2005 level by 2025 while China intends to achieve peaking of CO2 emissions around 2030, if not before, and to increase its share of nonfossil fuels in primary energy consumption to around 20 percent by 2030.¹⁰ EU leaders announced a 2030 greenhouse gas reduction target of 40 percent from 1990 levels along with at least 27 percent combined share of renewable energy and energy savings.¹¹ Although the US and the EU are using different base year and percentage declines, it is felt that the two goals are quite comparable.

Efficiency and Conservation

Energy Star Program

Major impetus to energy efficiency in the US is Energy Star program, established by EPA in 1992 to reduce greenhouse gas emissions by encouraging energy efficiency.¹² Computers and computer monitors were the first products to carry the Energy Star label, which was extended to other office equipment and residential heating and cooling equipment in 1995. In 1996. EPA partnered with Department of Energy (DOE) for those products that fell under DOE domain for enhancing efficiency (dish and clothes washers, refrigerators, room air conditioners, light bulbs, and windows). Energy Star now has thousands of partnerships with private and public sector organizations to deliver technical information and tools necessary for organizations to select business solutions and management practices that enhance energy efficiency. Companies that produce energy efficient products are provided means to break down market barriers and alter decision-making patterns so that more consumers will buy energy efficient products.

Energy Star label is issued when the additional cost of enhancing energy efficiency compares favorably with the benefit of lower energy costs throughout a product’s life. At times, there is no additional cost such as reducing energy demand when office equipment and home electronics (e.g., personal computers) are automatically placed in a standby mode. Energy Star label provides consumers with a straightforward determination of whether or not to purchase an energy efficient product. The goal of Energy Star is to have all manufacturers offer Energy Star labeled products, making it difficult for consumers to buy cheap energy inefficient products.

The primary focus of Energy Star is to enhance efficiency in order to reduce both demand for energy and concomitant pollution. In 2013 Energy Star reduced electricity demand by 380 billion kilowatt-hours equivalent to 5 percent of US electricity demand, which, in turn, reduced greenhouse gas emissions by 293 million metric tons, and saved $30 billion in energy bills. This represents a tripling of benefits over the previous 10 years. Energy Star has 16,000 partners in various aspects of increasing energy efficiency in residential, commercial, and industrial sectors. There are 480 partners promoting energy efficiency through combined heat and power plants, which now has a cumulative total of 6.2 gW of output. Over 4.8 billion Energy Star certified products have been sold representing 45,000 product models since the inception of the program. In 2014 over 90,000 homes Energy Star certified homes were built representing 13 percent of the home building market with annual energy savings between 20 and 30 percent. Cumulative total of Energy Star certified homes is over 1.5 million and over 22,000 commercial buildings have been Energy Star certified.

As part of its expanded Climate Action Plan in collaboration with EPA, Energy Star offers an assortment of outreach programs to landfills, coal bed methane and conventional methane producers, and agricultural industry to reduce methane emissions. Climate Action Plan is concerned with greenhouse gas emissions of which residential and commercial sources account for 35 percent, equally divided between the two. The remaining sources are industrial (30 percent), transportation (27 percent), and agriculture (8 percent). Greenhouse gases are estimated to be 85 percent carbon dioxide, 13 percent methane and nitrous oxides, and 2 percent HFCs, PFCs, and sulfur hexafluoride. Methane emissions are primarily leakages in production and distribution of natural gas industry, whereas nitrous oxides stem mainly from electricity generation and transportation.

Energy Star program is a strong advocate of geothermal heat pumps (GHPs), loops installed underground that take advantage of the constant temperature environment to reduce heating and cooling costs. The main advantage of GHPs is that they can reduce electricity demand for conventional heating and cooling systems by 25–50 percent. If a typical residential GHP can reduce summer peak electricity demand by about 2 kW, then 500 homes can reduce peak power demand by a megawatt. That’s a megawatt of electricity that does not have to be generated, otherwise known as negawatt. Negawatts embody the idea that cutting electricity consumption without reducing energy usage through energy efficiency or other means such as GHPs is one of the best ways to reduce fossil fuel demand.¹³

Light Emitting Diodes and Compact Fluorescent Light Bulbs

An incandescent bulb, as the name suggests, heats a filament in a vacuum until it glows, releasing a large amount of waste heat. Light emitting diodes (LEDs) are made of semiconductor materials and have been around since 1960s when LEDs emitted only red, green, and yellow light. In the 1990s blue LEDs were developed, which, when combined with red and green, resulted in white light. Since then improvements have been made to reduce their manufacturing costs and improve brightness. Compact fluorescent lights (CFLs) consist of a bulb filled with argon gas with a tiny amount of mercury (5 milligrams or less), which presents a disposal problem not present in LEDs.¹⁴ A charge across the bulb induces electrons to flow through the inert gas vaporizing mercury. Mercury vapor gives off photons that interact with a phosphor powder coating on the bulb’s inner surface to give off white light. Other colors are possible by switching argon with neon or other rare earth gases. Both LEDs and CFLs consume 75 percent less energy than an incandescent light bulb of the same brightness. CFLs are more expensive than incandescent bulbs, and LEDs are more expensive than CFLs, but LEDs have a much longer life. Based on three hours a day usage, CFL can last around 9 years and LED in excess of 22 years. CFLs take one second to turn on with some delay before achieving full output whereas the LED turns on at full output instantly. A CFL is cooler than an incandescent bulb and an LED is cooler than a CFL. At this time CFLs are replaceable like ordinary incandescent light bulbs, whereas LEDs were usually part of a fixture where the fixture has to be replaced in case of a failed LED.¹⁵ However, it is now possible to buy LED bulbs.

The US Energy Independence and Security Act of 1970 calls for light bulbs to be 25–30 percent more efficient in 2012 for 100 W bulbs and above and in 2014 for 40 watt bulbs and above. This spelled the end of incandescent bulbs, but CFLs met this criterion. By 2020 light bulbs are to be 70 percent more energy efficient than incandescent bulbs, a condition still satisfied by CFLs. The fall in electricity demand by switching from incandescent to CFLs will lower energy demand, cut pollution emissions, and reduce the need to build large generating plants. Less capital spending for electricity generators and transmission lines can be dedicated to fulfilling other needs. The fly in the ointment is that most lighting is needed at night, when electricity demand is at its lowest. CFLs/LEDs reduce night time base load demand, not higher day time demand. The fall in base load demand still necessitates generators to handle day time demand.

CFLs are a government mandated market representing little risk for manufacturers since consumers do not have an alternative product.¹⁶ Other nations that have established phase out schedules for incandescent bulbs are Argentina, Brazil and Venezuela in South America, China, India, Philippines, and Malaysia in Asia, European Union, Canada, Australia, New Zealand, and Israel. The public is not unanimous about the phase out of incandescent bulbs. One enterprising individual sells incandescent bulbs as “mini-heaters!”¹⁷ Halogen bulb looks like an incandescent bulb, but is more expensive to buy. However when lower electricity demand and longer life of a halogen bulb is taken into account, the economics favor buying a halogen bulb over an incandescent bulb. Some countries are phasing out halogen bulbs because of their mercury content along with incandescent bulbs.

In California, low pressure sodium lamps for street lights are being replaced with solid state light-emitting diode (LED) lamps. The new lamps have turned night into day as a yellowish orange tinted light has given way to a bright white light. Sodium lamps have a luminous output of 200 lumens per watt, but actual performance may be two-thirds of their rated lumens per watt. New white LEDS street lamps are rated at 100 lumens per watt. In-house CFLs get 60 lumens per watt while incandescent bulbs emit only 15 lumens per watt. While there are energy savings associated with LED street lamps, their main advantage is longevity. It is expected that LED lamps will have an economic life of 10 years before their original brightness falls by 30 percent. Low pressure sodium lamps last about 3–4 years before being replaced from consuming too much power. Cost of changing a LED street lamp is around $60 versus $200 for a sodium lamp. The higher acquisition cost for LED street lamps is being reduced by technological advances in manufacturing. For in-house applications, CFLs are not lasting nearly as long as expected and the warm-up period before reaching full luminosity is a cause of customer dissatisfaction. LEDs are much brighter and are at full luminosity when turned on. It is expected that LEDs will eventually replace CFLs in home as manufacturing costs fall sharply. Introduction of LEDs and CFLs has significantly reduced the share of electricity once dedicated to incandescent lightbulbs.¹⁸

LED lighting is so efficient compared to its alternatives that Africans are using a gravity lamp powered by pulling an 8 kg weight attached to a chain to the top position similar to winding a grandfather clock. Its descent over the subsequent 25 minutes provides sufficient indoor lighting for reading. The gravity lamp eliminates the kerosene lamp with its fumes and potential risk of fire. Only cost for a gravity lamp is its acquisition while a kerosene lamp has both an acquisition and operating (fuel) cost. Cost of kerosene for lighting can be as high as 10–20 percent of annual income.¹⁹

US Green Building Council/LEED

The US Green Building Council (USGBC) is a non-profit organization dedicated to sustainable energy through cost efficient and energy saving green buildings. The organization comprises 78 local affiliates, over 20,000 member companies and organizations, and more than 100,000 accredited professionals. Its membership includes builders and environmentalists, corporations and nonprofit organizations, elected officials and concerned citizens, teachers, and students. USGBC maintains that buildings are responsible for 39 percent of carbon emissions, 40 percent of energy consumption, and 13 percent of water consumption. Greater building efficiency can satisfy 85 percent of projected incremental energy demand, reducing need to build more electricity generating plants. USGBC has an educational outreach certification program called Leadership in Energy and Environmental Design (LEED), which provides a framework for identifying and implementing practical and measurable green building design, construction, operations, and maintenance to owners and operators. LEED’s internationally recognized certification system measures how well a building performs in terms of energy savings, water efficiency, reduced greenhouse gas emissions, improved indoor environmental quality, and resource stewardship. Its rating system has become a nationally accepted standard for the design, construction, and certification of environmentally friendly “green” buildings that cut energy demand by half and water demand by a third. Structure, materials, insulation, heating and cooling systems, windows and doors, water usage, shade trees and landscaping, and disposal of construction debris are some of the areas scrutinized in a LEED certification.²⁰

Sustainable Energy

Energy Returned on Energy Invested (EROEI)

EROEI is the ratio of energy output to energy input or EROEI, which has been dropping over time meaning that more energy input is required to obtain the same output of energy.²¹ EROEI (there are other acronyms) in the earliest days of oil was about 100:1; that is, one barrel of oil invested in drilling and bringing a well into operation produced 100 barrels. When oil was originally discovered, EROEI was 100 meaning that one unit of energy input generated 100 units of energy output. In 1970, combined oil and gas EROEI was 30 meaning that 1 unit of input generated 30 units of output, down considerably from nearly a century before. But in 2005, 35 years later, EROEI was down to 14.5 meaning that the energy input to obtain the same output had doubled. Halving of EROEI in 35 years represents an annual declining rate of 2.5 percent. The reasons for this are clear. Easy to find and develop reservoirs have already been tapped. Having picked low hanging fruit, now it becomes more difficult to fill the basket epitomized by onshore drilling giving way to offshore drilling. Offshore drilling progressed from several hundred feet, to a thousand feet, to ten thousand feet; a radical transformation that required much more energy input. Onshore fracking of gas and oil is more energy intensive since the 3-year well life is much shorter than 20–30 years for conventional oil and gas wells. Seven to ten fracked well replacements are necessary to have the same longevity and output of a single conventional well indicating that much more energy will have to be invested in fracked over conventional wells. Of course the exact effect on EROEI also depends on the relative ratio of number and output of fracked to conventional wells. Much more energy is required to obtain a gallon of gasoline from Canadian oil sands than from a conventional well in Texas.

The highest EROEI today is 100 for hydropower where one unit of energy consumed in building a hydropower plant will return 100 units of energy. EROEI for coal is 80 and combined EROEI for oil and gas was 30 in 1970, which declined to 14.5 in 2005, again illustrating the increased energy consumed to produce oil and gas. Nuclear power’s EROEI is between 10 and 50 depending on the enrichment method; for wind 18; for solar (photovoltaic) 6.8 and between 1.5 and 2 for thermal solar collectors; for ethanol made from sugarcane 5 and from corn 3; for oil shale is 5 and 3 for bitumen tar sands.²² EROEI for wind and solar reflects energy required to build wind turbines and solar panels and thermal collectors, which, of course, is a one-time energy investment. EROEI with regard to synthetic crude of 3 reflects extra energy consumed in treating, processing, and transporting oil sands before it can be substituted as refinery crude oil.

Some contend that once EROEI falls below 1, energy transformation is no longer possible. This would certainly be true if one barrel of crude oil were consumed to produce one barrel of crude oil. But how the ratio is calculated is of great importance. For instance, in the chapter on biofuels, it was asserted that biofuel (ethanol) made from sugar in Brazil had an EROEI value of 8 when the ratio is based on fossil fuel input, not energy input. It was also further asserted that the ratio could be further improved if biodiesel were substituted for petrodiesel. Ethanol made in the US had a much lower ratio because of greater use of fossil fuel in growing and transforming corn to ethanol. Energy from the sun to fuel photosynthesis is not part of the ratio as are any renewable energy sources. Thus the ratio has to be carefully described for it to have any value.

Regardless of EROEI value, any form of energy must pass the economic test of being sold for a profit. Price of synthetic crude must cover operating and capital costs where one aspect of operating cost is natural gas consumed in processing oil sand. Another controlling factor on synthetic crude is availability of natural gas—synthetic crude production may eventually be curtailed by shortfalls in natural gas, which, if true, would have a significant impact on the amount of resources that can be classified as reserves. Moreover many forms of energy have a negative EROEI, meaning that energy input is greater than energy output. To generate 1 energy unit of electricity, 3–4 energy units of coal are burned. No one is against generating electricity because it has a negative EROEI. Electricity is so much more useful than burning a lump of coal that we cheerfully accept a negative EROEI value and pay its associated costs, including coal, in utility rates. Energy input to grow grain is greater than energy output in calories when consumed by humans. Should we stop growing grain because its EROEI is negative? Suppose that two energy units of coal are necessary to produce one energy unit of petroleum products. If coal reserves are measured in centuries, would a negative ratio stop the conversion of coal to liquids? What prevents greater use of coal for transformation to petroleum products is the economics of the process, which includes capital and operating and feedstock costs. For these reasons, some believe that the concept of EROEI is not relevant in determining energy policy and analyzing energy projects.²³

Figure CW11.1 shows the approximate EROEI values of most types of energy.²⁴ There is significant uncertainty regarding EROEI values not the least being lack of an agreed methodology for assessing values.²⁵

Figure CW11.1 EROEI Values for Various Types of Energy
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Hydro and coal are most efficient in terms of EROEI whereas biofuels such as corn ethanol and biodiesel are quite energy inefficient in terms of energy consumed to produce these fuels. Greater emphasis on hydro and coal will tend to minimize the amount of energy that has to be consumed to extract a given output of energy; reminiscent of the earliest days of oil when oil would gush out of a shallow reservoir. Calculations of EROEI are independent of energy type, although the presumption is that energy input is some form of fossil fuels. Absorption of solar radiation is not part of the EROEI calculation for solar energy and biofuels. (Technically speaking, energy conversion increases enthalpy and this means that EROEI is always negative if all forms of energy (e.g., renewables) are taken into consideration.) But a low EROEI could be economically attractive if it represents, for example, an energy input of low cost and plentiful coal with an energy output of more valuable motor vehicles fuels.

As discussed in Chapter 3, sugar ethanol requires less fossil fuel input for the same volume of corn ethanol. With Brazil taking the initial steps to substitute biodiesel for petrodiesel in operating sugar plantations and distributing ethanol, EROEI for sugar ethanol should increase further. However, if biodiesel is also substituted for petrodiesel on oilseed farms for producing biodiesel, EROEI for sugar ethanol would not increase as energy considerations are generally restricted to the “first level,” but EROEI for biodiesel would.

Solar photovoltaic has an EROEI of 6.8 meaning that one unit of energy consumed in its manufacture generates 6.8 units of output over the life of the photovoltaic cell. Much of the energy input is electricity, which is part fossil fuels, part nuclear, and part renewables (hydro, wind, solar). No differentiation is made as to the type of energy consumed in generating electricity. But suppose that energy consumed in manufacturing photovoltaic cells is solely from solar power, or other form of renewable energy. Then EROEI would reach a very high value as the only nonrenewable energy consumed would be in distribution and installation of solar panels. The other problem is depth of analysis. EROEI for oil is energy consumed in bringing oil out of the ground and processing it. Should we progress to the next layer on energy consumed in production of steel in drilling rigs and refineries? Or yet another layer deeper, should energy consumed in the mining of iron ore and coal to make the steel found in drilling rigs and refineries be included? While there are several identifiable problems associated with EROEI, it is still a useful gauge of how much energy is required to produce usable energy.

The weighted average EROEI taking into account the volume of energy generated by each type fuel is 40. As noted, EROEIs for oil and gas are declining as the technical challenge associated with discovery and production increases. This does not matter as long as price can cover the extra costs of extraction; but as occurred in 2015, a falloff in oil prices caused a virtual cessation of drilling new fracked oil wells and developing new projects in oil sands and deep ocean waters. In Figure CW11.2, EROEI starts at 40 and decreases at 2.5 percent per year while energy growth is 1 percent. The starting base is 100 percent for energy output with energy input is 2.5 percent of output for a 40:1 EROEI ratio. At 2.5 percent decrease in annual EROEI, in 150 years, energy input is 50 percent of projected energy output; in 180 years, energy input is 100 percent of projected energy output. Energy prices would have to remain very high for energy transformation and generation to remain economically viable. An EROEI of 1, where energy input equals energy output, is not doable if a barrel of oil is required to produce a barrel of oil. It is doable if energy input, as an example, is a very low grade of coal and output is valuable gasoline. But the price of gasoline would have to be high enough to cover the cost of coal.

Figure CW11.2 Rise of Energy Input to Sustain Growing Energy Output

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The ratio worsens with time hastening exhaustion of a resource. Of course this is an extrapolation that does not take into account what may occur in the future to reduce energy input with regard to energy output such as greater reliance on hydro and renewable energy.

1^ “The Plain English Guide to the Clean Air Act,” Environmental Protection Agency (2006), Web site www.epa.gov/oar/oaqps/peg_caa/pegcaain.html.

2^ “EPA Cross-State Air Pollution Rule,” EPA, Web site www.epa.gov/airtransport/CSAPR.

3^ National Resources Defense Council Web site www.nrdc.org/health/effects/mercury/sources.asp.

4^ “EPA Mercury and Air Toxic Standards,” EPA, Web site www.epa.gov/airquality/powerplanttoxics/index.html.

5^ EPA Diesel Fuel Web site www.epa.gov/OTAQ/fuels/dieselfuels/index.htm.

6^ Information on Climate Change Conferences available at United Nations Framework Convention on Climate Change Web site http://unfccc.int/2860.php.

7^ “Report of the Conference of the Parties on its sixteenth session, held in Cancun from 29 November to 10 December 2010,” United Nations Framework Convention on Climate Change, Web site http://unfccc.int/resource/docs/2010/cop16/eng/07a01.pdf.

8^ “Green Climate Fund (GCF): Contributions,” World Bank, Web site http://fiftrustee.worldbank.org/index.php?type=contributionpage&ft=gcf.

9^ Roger Harrabin, “Rich Countries to Discuss Green Climate Fund in Berlin,” BBC News (November 20, 2014), Web site www.bbc.com/news/world-europe-30123932.

10^ “U.S.-China Joint Announcement on Climate Change,” White House Press Release, Web site www.whitehouse.gov/the-press-office/2014/11/11/us-china-joint-announcement-climate-change.

11^ “2030 Framework for Climate and Energy Policies,” European Commission (October 2014), Web site http://ec.europa.eu/clima/policies/2030/index_en.htm.

12^ Information on the Energy Star Program and Annual Report of the Energy Star Program for 2013 available online at Web sites www.energystar.gov and www.energystar.gov/ia/partners/publications/pubdocs/ENERGYSTAR_2013AnnualReport-508.pdf?334c-bd77.

13^ Douglas Dougherty (Geothermal Exchange Organization), “Energy Efficiency, Geothermal Heat Pumps and ‘Negawatts’,” Renewable Energy World (January 24, 2013), Web site www.renewableenergyworld.com/rea/news/article/2013/01/energy-efficiency-geothermal-heat-pumps-and-negawatts.

14^ “Compact Fluorescent Bulbs and Mercury: Reality Check,” Popular Mechanics (June 10, 2007), Wseb site www.popularmechanics.com/home/reviews/a1733/4217864.

15^ “Learn about CFLs,” Energy Star, Web site www.energystar.gov/index.cfm?c=cfls.pr_cfls_about. See also “Learn about LED Bulbs,” Energy Star, Web site www.energystar.gov/index.cfm?c=lighting.pr_what_are.

16^ It has bothered me for some time that a captive market for CFLs in US, assuming 5 bulbs per person or 1.5 billion bulbs, are not manufactured in US. A CFL is primarily made by machine with little labor input. A machine has the same cost wherever it’s located. So why then are CFLs made in China to serve US market? The labor cost differential between American and Chinese workers on a per bulb basis must be minuscule and bulbs have to be transported halfway around the world. Perhaps CFLs can “cast light” on reasons for the retreat (if not the rout) of American manufacturing. Part of the answer is that an internationally oriented company such as General Electric has profits oversees that cannot be brought back to US without paying about 40 percent in corporate taxes. With money essentially frozen outside US, these companies have little choice but to reinvest these funds overseas to the detriment of the US economy.

17^ “Phase-out of Incandescent Light Bulbs,” Wikipedia, The Free Encyclopedia, Web site http://en.wikipedia.org/wiki/Phase-out_of_incandescent_light_bulbs.

18^ “Everlasting Light,” The Economist Technology Quarterly (June 1, 2013). See also “The New Path for Lights, Thinking beyond the Bulb,” The New York Times (April 25, 2013).

See also “Lighting the Way to a Green City: Copenhagen’s Smart Streets Reduce Energy Use,” The New York Times (December 9, 2014).

19^ GravityLight Web site http://gravitylight.org.

20^ U.S. Green Building Council Web site at www.usgbc.org.

21^ A greater level of detail and discussion on EROEI can be found at Web site http://eroei.net.

22^ David J. Murphy and Charles A. S. Hall, “Year in review–EROEI or energy return on (energy) invested,” Annals of the New York Academy of Sciences, Ecological Economics Reviews, vol. 1185, pages 102–108 (January 2010), Web site http://onlinelibrary.wiley.com/doi/10.1111/j.1749-6632.2009.05282.x/abstract.See also Tim Morgan, “Life after Growth: How the Global Economy Really Works – and Why 200 Years of Growth Are Over,” Harrison House, Hampshire, UK (2013).

23^ Tim Worstall, “Peak Oil and EROEI: Still Nonsense,” Forbes (November 5, 2011), Web site www.forbes.com/sites/timworstall/2011/11/05/peak-oil-and-eroei-still-nonsense.

24^ Murphy, D. J., and Hall, C. A. S. (2010), “Year in review EROEI or energy return on energy invested," Annals of the New York Academy of Sciences (2010), Web site http://onlinelibrary.wiley.com/doi/10.1111/j.1749-6632.2009.05282.x/abstract as cited in Wikipedia, the Free Encyclopedia, Web site http://en.wikipedia.org/wiki/Energy_returned_on_energy_invested#CITEREFMurphyHall2010.

25^ Ajay Gupta and Charles Hall, “A Review of the Past and Current State of EROEI Data,” Sustainability (2011), Web site www.mdpi.com/2071-1050/3/10/1796.

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