what if the price of oil declines significantly?

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Permalink Reply by Hugh Hemington on October 15, 2008 at 1:42pm

The cheapest fuel I can find, and DID find is Natural Gas. I pump it at home for $1.30 per "gge", and I get 36 MPG.

If even HALF of the households with natural gas, who don't need to drive more than 130 miles a day bought an NGV, it would have a huge impact on the problem.

There have been a few flaky conversion kits. Allowing them to proliferate in the market is not a good idea. The major auto makers already have CNG cars they sell elsewhere, or have sold here. Let's get them into the market HERE!

California has a lot of fueling sites, but we need more. We can get fueling sites built or added to gasoline stations here and elsewhere.

While we wait for hydrogen to "get real" -- with economical generation and cost-effective fuel cells, we have the "bridge" available now. There are no technical problems preventing natural gas from satisfying a huge part of our passenger vehicle and heavy truck needs.

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Permalink Reply by Robert D. Jones on October 15, 2008 at 3:48pm

Hugh,

I assume that you won't mind if I talk to both your notes with one response.

CNG -- Please understand that I'm for it. I've spent considerable time looking into the viability of it's use in this area (Houston, Texas). The results were discouraging, at best. The closest station (last time I looked -- which was before Ike) was in Dallas. There were a couple of company fueling sites in North Houston that were not available for the rest of us. The lowest price was something like 1.65 per gallon at those private fleet stations.

But availability is only half the issue -- and by far the easiest to solve. If I were able to get a conversion kit for my light truck, I would put in a home refuling center in a heartbeat. I don't drive that many miles, but I would do it because I believe fully that we must get off the foreign oil dependency. You don't have to convince me -- I have been associated with the oil business all my life (my dad was a wildcat oilman here in Texas) and I spent a good deal of time in the military. I am aware of the depletable resource situation on the one hand and I have always believed that you do not make yourself dependent on a potential enemy for a vital resouce on the other.

But, no matter how strong my motives, I must deal with the reality I see. CNG may well be available in California and even several other states. Interestingly enough, as I said in a note a month or so ago, it was available here (there was a fueling station less than five blocks from my home) several years ago. It closed for lack of interest. Not too shocking since all the CNG vehicles were fleet owned and they fueled at company stations. The blunt truth is that even if the fueling station was still there, it would be of no value to me because I am not able to convert any of my cars to use CNG. As an aside, even if I owned one of the vehicles with EPA approval, the closest company approved to do the conversion is in Dallas and there are no maintenance facilities anywhere close. So the position is that I have to purchase new cars and a fueling station to participate. I simply can't afford to buy new cars simply to be able to run CNG, even as interested as I am in getting off the foreign oil dependency.

Which brings me back to what I believe to be the salient issue. If the Pickens Plan is serious about the need to convert to CNG across the land, we must have some relief from the EPA rules. People must be in a position to convert the cars they own to CNG for a reasonable price. I do not advocate flaky kits, but I do think that we have to get it to the point when normal citizens can participate -- or it simply isn't going to happen.

And that is my concern with the Pickens Plan, as it stands. I see lots of advertisements touting both the plan and the wonders of CNG. However, when you investigate you run head-on into the simple fact that vehicles that run on CNG are simply not available to the common citizen. Further is is pretty apparent that situation will not change in the reasonable future. Shucks, we may well have the hydrogen fueled vehicle before we have CNG as a common fuel across the land.

Touting a solution that is virtually impossible is not the way to get the Nation moving in the right direction -- to the energy indepence we all advocate.

Regards,

Bob

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Permalink Reply by Hugh Hemington on October 15, 2008 at 1:25pm

World oil reserves will not support economical use of petroleum as a motor fuel, for more than another twenty to thirty years! Middle East oil reserved will not last that long. Right now, they have a system of patronage, distributing money through a network of thousands of "princes" to keep their population happy. They are already failing, sending terrorists away with handfuls of sweaty cash to come and attack us.

Right now they have sand and oil. In twenty years, they'll just have sand. Sand and a lot of really unhappy people! If we're dependent on them or OWNED by them when that happens, we'll send our children and weapons off to another war to defend them.

Regardless of what a gallon of gasoline costs, the cost of remaining dependent on it is too high!

Regardless of what you think the world oil reserve is, everyone agrees there's a limit to it! Only Bugs Bunny waits till the last moment to pinch off the fuse leading to the bomb! If this one blows, we won't be blinking, and covered in soot, we'll be gone. Period.

With the "fuse lit", the question isn't, "How much longer can we wait?" The question is, "Why would we wait any longer?"

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Permalink Reply by L.E.D. on October 15, 2008 at 6:10pm

The reduction of the price of oil and gasoline is the direct result of reduced demand. What would you expect from reducing our consumption of oil, prices to stay the same? No, they will go down. T.B. Pickens talked about reducing our demand on foreign oil by 30 percent would reduce the "700 billion" by 30 percent but that's not true, it'll reduce it by much more than that because it will not only reduce quantity imported but also cost per barrel.
This reduction in price of oil and gasoline may be in part due to economic problems but also due to the choice of americans to use less gasoline

Robert, why not buy a fuel efficient car? I think it's important to switch big rigs, dump trucks, farm equipment, construction vehicles, buses, trash trucks, taxis etc to NG, and they should get the monetary resources (subsidies, tax credits) and help first because those motors run for a much larger percentage of the day than our vehicles and consume a lot more fuel per unit time of running. We might end up freeing up too much diesel, which is why car companies should add diesel and CNG options to personal vehicles. We should demand the availability of CNG cars soon from car makers (especially american car makers) but if you are in the market for a new car now, get an efficient one (2009 chevy cobalt XFE gets 37 mpg on highway, prius gets around 46 mpg).

If you have a huge SUV or truck and you have extra cash and you really want to do something, don't sell the SUV, just let it sit on the driveway and get a fuel efficient little car. If you sell the SUV someone will drive it eating up gasoline.

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Permalink Reply by Robert D. Jones on October 16, 2008 at 8:57am

Morning L.E.D.

The original premise on which this discussion was based was, what do we need to do to keep the focus on getting off foreign fuel sources if the price of oil declines to the point where people no longer felt an economic pinch. I will state categorically that, even with the recent economic downturn, people never really reached that position. That statement is based on the fact that sales of products, such as I-pods, fancier and fancier cell phones, and other non-essentials has remained high. Further, you don't see the proliferation of people going to public transportation or doing much more than slightly reducing their driving.

And, whether we believe it or not, the price of petroleum is influenced by factors outside our control. The primary factor is total production versus need. The folks that produce the oil (OPEC, in particular) are feeling the pinch of reduced oil prices, so, they are (stupidly, in my view because low prices will reduce our National will to develop viable alternatives) reducing production.

In any case, even if oil keeps going down, we still need to remove our dependence on potential enemies for whatever amount we need. That fact is why I got on board the Pickens Plan in the first place and it is why I stay active. I started this discussion topic because I feared we would encounter exactly the problem we face today. We have a Congress that is firmly against any real alternative fuel development and, potentially, a President that will agree with their position making any real progress virtually impossible. For the record, I am an independent voter. I said what I said based on what the candidates say and what the Congress has done.

All that being said -- my point regarding CNG as the touted best alternative by the Pickens Plan is that it contains a basic flaw. It ignores the simple fact that CNG fueling stations are not commonly available across the nation AND the severe limitation on the ability of private citizens to convert their vehicles to use that fuel. These are hard facts that no one seems to address except to say that we should all buy new cars that run CNG. Last time I looked, only one car manufactured to run on CNG was for sale in the US (California). It was a Honda Civic and fairly expensive (compared to the gasoline model). In my opinion, ignoring that reality undermines the whole plan, because it indicates a lack of planning forethought leading to a less than forthright statement of the problem/solutions space. It needs to be addressed and resolved sooner, rather than later.

I'm all for fleet users converting to CNG. In fact, the city of Houston uses CNG for their bus fleet. Several other public and private entities also have converted their vehicles to use CNG. Wonderful, as far as it goes.

But, if you look at the freeway traffic here in Houston -- or in any other large metropolitan area -- the potential for reducing petroleum dependence far exceeds that encompassed by the various vehicle fleet operators. And the restrictions imposed by the EPA are, according to what I have read on the various CNG kit/conversion providers web-sites, are the primary factor limiting the availability of certified change-out components. The concept that you can change out a Ford F-150 (don't know what engine) to CNG in something less than an hour (as per another responder) simply underscores my point. If a kit allowing my Ranger to run on CNG and gasoline were available, I would install it, particulary if it took less time than required to replace the brakes. I would also install the home fueling station needed to fuel it. I think there are many, many other people that would do the same -- not for economic or even environmental reasons, but because they agree that outsourcing of a major resource is contrary to national security -- and this is something they can do personally and individually to help the Nation.

My Ranger (which runs on gasoline or ethanol) gets 18 mpg, city and co

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Permalink Reply by Greg R. on October 29, 2008 at 3:52pm

My brother converted his Toyota 4×4 to CNG here in Alberta back in the 80's. It ran economically and cleanly, as advertised, and he could flip a switch and run on gas when a CNG refueling station wasn't nearby. All well and good until he hit a moose one night. I'm not sure whether he had recouped the conversion costs by then or not.
In spite of the above, I'm also not convinced CNG is a panacea. I am inclined to think electric cars will be the answer in 10-15 years, fuelled in part by efficient cogeneration plants fired by NG and synthetic gas derived from North America's still-plentiful coal reserves. Yes, wind and solar and even nuclear will play a role too, but the fossil fuel plants have better economics, and cogen will address much of the GHG concerns (and eventually sequestration will address even more).
In the meantime, I think Alberta's oil sands plants, like them or not, are going to be a very big piece of the transportation puzzle. (Yes, they're energy-intensive, so the Greens hate them. But the technology is proven, and they're here, not somewhere in Siberia or the Middle East.) And the Pickens plan will hopefully help people stay focused on the need to reduce reliance on non-friendly energy providers.

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Permalink Reply by Robert D. Jones on October 31, 2008 at 8:41am

I have a close friend (handball partner) who bought and drove an electric powered Ford Escort way back in the seventies. He liked the car (it would keep up with traffic, etc., ) except that the battery maintenance was "a pain". Contually refilling the cells that were located in the trunk and the engine compartment.

The company that manufactured them apparently put a pretty stout electric motor in place of the original engine and wired the throttle pedal to provide variable power. The transmission was used just as if it were gasoline powered. He plugged it in every night and drove it twenty or thirty miles to and from work every day. We were kidding last evening that he was almost forty-years ahead of his time.

Bottom line, I see no reason that electric cars would not be reasonable substitutes. The generation of electricity by various means would not be a limiting factor. I lived in an all electric house in an area where power was obtained from a nuclear plant and it cost a tenth of the amount paid for the same amount of electricity from a non-nuclear power plant in a different municipal utility district less than a mile away. That was in the early eighties. Seems like we would have learned something -- but, based on the forced limits on what you can do to recycle spent fuel rods (see Congress) and the fear factor instilled by people who ignore the actual safety record -- we are twenty-years behind the rest of the world in terms of nuclear power.

I agree that the oil sands/oil shale available, along with clean coal and other petroleum based power sources will cover an amazing amount of the usage (clearly enough to eliminate the need for middle-East petroleum. That will be the short term answer. The long term (in my relatively well informed opinion) will be hydrogen fuel -- either direct combustion or fuel cell produced electricity.

The only thing in question is who wins the Presidency here and how much emphasis is directed on the development program. That will determine how long it will take to get that kind of renewable energy on board.

Finally, we need to keep focus -- even when the price of gasoline is less than $2.00/gal -- as it is here right now.

Bob Jones

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Permalink Reply by neil cox on October 31, 2008 at 10:17am

Hi Bob: In the 70s, the vehicle likely had at least 23 deep cycle 6 volt lead acid batteries, with 3 filling caps on each battery, so it was tiresome to add water once per month; oftener if he was over charging his batteries to be sure he would make it home each evening.
As the batteries aged making it home became increasingly doubtful. Did he replace the 23 plus batteries at a cost of about $1000? Neil

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Permalink Reply by Robert D. Jones on October 31, 2008 at 11:00am

Didn't ask him, but he eventually sold the car to some guy in Colorado who made a living selling solar panels, etc., to folks that lived out in the boondocks -- remember this was almost forty-years ago. The guy painted it bright yellow and installed solar panels on the roof -- of course that wouldn't keep the car running, but was good advertisement -- I guess.

Bob

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Permalink Reply by jim ross on October 16, 2008 at 1:18pm

we have to learn how to use and conserve the oil we have.. plastic uses alot of oil to make. if people would recycle more it cut our uses in half. i am saving over 500$ a yr by doing that. i dont have to by as many trash bags. alot of my trash goes to the local recycling center. its not an inconvience at all. in fact its almost a way of life. all my cardboard ,plastic,paper go there. i have changed all my light bulbs over to fluresent bulbs . i would like to be able to afford to change my whole house over to alternative energy, but not in my buget, just a fork truck driver in a factoty, but its 1 step at a time

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Permalink Reply by Robert D. Jones on November 5, 2008 at 6:31am

The question now (after the election) is -- to what extent will the far-left Congress and the most liberal person ever elected President allow actual effort on alternative and internal sources of power to progress. As it appears, there will be no money available to conduct the research needed to determine the more viable of the various candidates -- let alone their aversion to nuclear power and additional drilling. It appears that all the effort will have to come from non-government sources and for that to happen the resulting development must, repeat must, be commercially viable. From what I've heard, even wind power is not viable if oil goes below $50/bbl.

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Permalink Reply by Ray Phillips on November 5, 2008 at 9:30am

Just from what I have read over the past few weeks, you may be surprised by the new president. In several interviews, he has proclaimed the energy problem as his highest priority, after the economy of course. One person, reportedly in the inner works of the campaign, said that people would be surprised to find that nuclear is definitely on the table in the president-elects plans.

Wind and solar are not competetive as energy producers even with oil at $140 a barrel, much less $50 a barrel. The thing about wind and solar is that they are renewable and clean, which many people, even those not traditionally supportive of clean technology, now support. As more and more people turn to wind and solar, the prices on the equipment will come down to more reasonable levels and they will become fairly competetive.

As for the "far left Congress" and the "most liberal person ever elected President," remember that the issue with the Democratic party has been the diverse people it represents, from far left liberals to centrists. This is what has hurt it in most elections, and is not a new thing. Will Rogers is reported to once have quipped, "I am not a member of any organized political party. I am a Democrat." Once sworn in, President Obama is going to have to deal with a wide range to politcal ideals. Plus, the new Senate with its Democrat majority may not have reached the filibuster proof 60 Democratic seats, but some of the new Democratic Senators are centrists who will not fall in lock step with their liberal party-mates. Because of Senate rules, Senator Reid will not be able to run rough-shod over the Senate the way Speaker Pelosi can in the House.

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