IAGS logo Energy Security
Prepared by the
Institute for the Analysis of Global Security

July 12, 2004
Contact IAGS: info@iags.org
To subscribe, send a blank email to subscribe@iags.org
To unsubscribe, send a blank email to unsubscribe@iags.org

Energy Security Current Issue

Terror's Next Target
Attacks on the West's oil and gas infrastructure -- from production facilities to pipelines and tankers -- are likely to be the next "mega" target of terrorists, and could wreak havoc with the world's economy, according to an in-depth IAGS analysis of the susceptibility of the energy industry featured in the latest Journal of International Security Affairs (Winter 2004).

China and US should set up a strategic dialogue on energy issues
Interview with Dr. Gal Luft of the Institute for the Analysis of Global Security, originally published by 21st Century Business Herald in Chinese.

A crude threat
The terrorist campaign against Iraq's pipelines demonstrates that pipeline attacks are no longer a tactic but part of a sustained, orchestrated effort that can deliver a significant strategic gain. They can also cause significant damage to the global oil market.
Next in line to emulate the insurgents in Iraq could well be Islamist terrorist groups operating in Central Asia, among them Chechen separatists and the Islamic Party of Liberation, a group that seeks to carry out a holy war against the West and is a suspect in the recent wave of deadly attacks in Uzbekistan.

Highlights from the Department of Energy’s International Energy Outlook 2004-2025

North Sea oil is declining
Since the 1970s North Sea oil has not only been a major source of wealth for both the British and Norwegian economies but also a way for Europe to cut its dependence on Middle East oil. Now many of the major fields in the North Sea are in decline and the North Sea is about to lose its prominent role as one of the world's leading oil domains.

Terror's Big Prize
Since September 11, pipelines, tankers, refineries and oil terminals have been attacked frequently. Except for a sharp increase in maritime insurance premiums in these regions these attacks had marginal strategic consequences. But in at least two cases oil terrorism could have rattled the world.

Libya: changing its spots?
Libyan crude oil is particularly attractive due to its very low sulphur content, which requires much less refining than higher sulphur oil. It is extremely high quality crude, whose characteristics are not easily found elsewhere. Despite its unique treasure, Libya's production capacity is relatively small, standing on 1.5 mbd of crude, or 2% of world supplies.
Since the 1988 Lockerbie bombing Libya had been under U.S. and UN sanctions which hindered its ability to generate enough investment to develop its oil sector. Libya's decision to embark on a rapprochement with the U.S came at unsurprisingly perfect timing, just as concessions for major U.S. oil companies were about to expire.

On the technology front

Fuel Cell power plant installed at NJ College
The fuel cell will provide 250 kilowatts of electric power as well as heat, to several buildings on the campus.

Biomass-to-Ethanol Progress
The enzyme costs of converting cellulosic biomass into sugars for fuel ethanol production have been reduced approximately twenty-fold with technology developed by the National Renewable Energy Laboratory (NREL) and Denmark based Novozymes, biotech-based leader in enzymes and microorganisms.

EU study: Methanol from biomass - competitive with gasoline
A study of a new patented Swedish technology concluded that the alchohol fuel methanol can be produced from biomass via black liquor gasification at a cost competitive with that of gasoline and diesel.

IAGS is a publicly supported, nonprofit organization under section 501(c)3 of the Internal Revenue Code. IAGS is not beholden to any industry or political group. We depend on you for support. If you think what we are doing is worthwhile, please Support IAGS. All contributions are tax deductible to the full extent allowed by law.

Property of The Institute for the Analysis of Global Security © 2003, 2004. All rights reserved.

Back Issues

Comparing Hydrogen and Electricity for Transmission, Storage and Transportation

A new study titled "Carrying the Energy Future: Comparing Hydrogen and Electricity for Transmission, Storage and Transportation" by the Seattle based Institute for Lifecycle Environmental Assessment (ILEA,) evaluated the energy penalties incurred in using hydrogen to transmit energy as compared to those incurred using electricity.

The report's main premise is that since hydrogen is not an energy source but an energy carrier its economic and environmental qualities should be compared to those of electricity, the only other commonplace energy carrier. It therefore compares the actual energy available when hydrogen and electricity carriers are employed and finds that electricity delivers substantially greater end use energy, concluding that "electricity offers more energy efficient options that might preclude mass-scale emergence of hydrogen technologies."

To illustrate the relative efficiencies of the two energy transmission methods, the study evaluated transmission of 4,000 megawatts of wind energy generated in the Great Plains wind fields to Chicago. Carrying the energy generated from remote renewable sources - solar, wind, etc. - to distant markets as hydrogen, requires that the electricity generated in wind turbines or solar panels be used to break water molecules into hydrogen and oxygen in a process called electrolysis. At the point of use (eg. on board a fuel cell vehicle,) hydrogen must again be converted into electricity.

Once energy penalties are taken into account, the above process leaves only 45-55% of the original energy compared to 92% if transmitted as electricity. Electrical transmission provides roughly twice the end use energy.

Storage is no less of a problem. Hydrogen is envisaged as a medium to store energy generated by renewables, making power available on demand. However the same aforementioned energy penalties apply while other energy storage technologies deliver comparatively more energy. Hydrogen storage returns around 47% of original energy, while advanced batteries return 75-85%.

According to the report, using electricity to charge electric vehicles (EVs) provides twice the miles per kilowatt hour than employing electricity to make hydrogen fuel. Lithium ion batteries developed for portable electronics can store electricity at an energy density about six times greater than conventional lead acid batteries and in the future could go nearly 250 miles between charges.

The report's authors Patrick Mazza and Roel Hammerschlag are particularly enthusiastic about plug-in hybrid electric vehicles (PHEV). Hybrid cars like Toyota Prius are already on the road today by the thousands. Their batteries are kept charged by power generated onboard. True to their name, plug in HEVs are hybrids that can be plugged in and draw charge from the power grid. Since they also have a fuel tank, PHEVs can take advantage of EV efficiencies without range and charge time limitations.

With a nickel metal hydride battery, similar to the one used in hybrids today, a PHEV could go up to 60 miles on grid power before the engine seamlessly kicks in. Considering the fact that half the cars on the road in the U.S. are driven fewer than 20 miles per day, most drivers, assuming they recharge their cars at night, will seldom have to dip into their gasoline tank. As a result, PHEV could reduce fuel consumption 85% over a comparable conventional car. That means that a plug-in hybrid SUV would consume less gasoline than a "regular" compact car, without a performance penalty. If such car runs on alcohol fuels instead of gasoline, oil consumption could be reduced even further.

The study distinguishes between hydrogen and fuel cells. While a hydrogen fuel system is hindered by multiple inefficiencies, fuel cells can form an important part of highly efficient systems that convert alcohol fuels to electricity. Fuel cells can operate as stationary electrical generators, potentially at significantly higher efficiencies than central power stations or other distributed generators. Emergence of a substantial fuel cell market is in no way conditioned on mass application in vehicles or development of a hydrogen network.

The study recommends that hydrogen and electricity advocates focus on complementary development that can support both pathways. This includes rapid expansion of renewables, improvement in hybrid vehicle technology, vehicle-to-grid applications that employ parked vehicles as grid energy storage, and development of biomass supplies from which liquid vehicle fuels and hydrogen can be made.