US Moves to Increase Use of Canadian Tar Sands
US imports of heavy oil derived from Canadian tar sands gained momentum recently with the approval of a pipeline to deliver the oil to the US and the approval of a refinery designed to handle the heavy oil.
The US. State Department announced on August 20 that it approved a Presidential Permit to Enbridge Inc. for the 1,000-mile Alberta Clipper pipeline, which will carry crude oil from Hardisty, Alberta, to Superior, Wisconsin. It will connect to an existing pipeline running from Fort McMurray to Hardisty, allowing the delivery of heavy oil extracted from Canadian tar sands, also known as oil sands.
Heavy oil is extracted from tar sands, clear-cutting pristine boreal forest and then using a very energy and water-intensive process – creating double the GHG emissions of conventionally derived oil. See the Pembina Institute’s Oil Sands Watch Web site for more information. DOE’s Energy Information Administration summarized oil sands in its Country Analysis Brief for Canada.
The pipeline will initially carry 450,000 barrels of crude oil per day, but will eventually be capable of carrying 800,000 barrels per day. According to Enbridge, Western Canadian tar sands developments are expected to grow by as much as 1.8 million barrels a day by 2015.
In approving the pipeline, the State Department cited the need for diverse, nearby crude oil supplies from a stable and reliable ally and noted that the project would create construction jobs. The State Department also asserted that GHG emissions are best addressed through each country’s robust domestic policies and a strong international agreement.
On August 27, Enbridge started construction on the Canadian portion of the pipeline. The Alberta Clipper pipeline is expected to be in service by mid-2010. See the State Department press release and the Enbridge press release and Web page about the project.
Meanwhile, a state board in South Dakota approved a preconstruction air quality permit in late August for a proposed refinery that will refine heavy oil from Canadian tar sands. The proposed Hyperion Energy Center in southeast South Dakota will include a refinery with a capacity of 400,000 barrels per day of heavy crude oil, and an integrated gasification combined cycle power plant.
The power plant will gasify petroleum coke from the refinery, producing a synthetic gas, or syngas. Hydrogen will be stripped from the syngas and used in the refinery, and the syngas will then be burned in a gas turbine to convert it into electricity. Hyperion Refining, LLC plans to begin construction on the refinery in 2011 and to start up in 2015. See the press release from the South Dakota Board of Minerals and Environment, as well as the Hyperion press release and project description.
DOE, US Treasury Award $502M for Renewable Energy Projects
The US Treasury Dept and DOE jointly announced $502 million in ARRA cash assistance on September 1 to energy companies in lieu of earned federal tax credits. This first round of awards is designed to create additional upfront capital, enabling companies to create jobs and begin construction on projects that may have been stalled until now. Ultimately, the program is expected to provide over $3 billion in financial support for clean energy projects. The direct payments will support an estimated 5,000 biomass, solar, wind, and other types of renewable energy production facilities in all regions of the country.
Of the 12 projects selected for this initial phase, 10 are wind facilities and 2 use solar power. The largest is the Peñascal Wind Farm in Sarita, Texas, which will receive $114 million. The 84 turbines at this Iberdrola Renewables site near the Texas coast will generate 202 MW of power. Another Iberdrola site, the 102 MW Locust Ridge II in Shenandoah, Pennsylvania, will receive $59 million.
Also selected were wind power projects in Maine, Minnesota, New York, Oregon, and a second facility in Pennsylvania. In addition, a 100 kW solar PV system in Boulder, Colorado, won an award, as did a 420 kW solar system in Danbury, Connecticut. See the DOE press release, the Iberdrola Renewables press releases on the wind farms in Texas and Pennsylvania, and Web postings on the solar projects in Colorado and Connecticut from Lighthousesolar and American Capital Energy, respectively.
DOE Awards $300M for Alternative Fuel Stations and Vehicles
DOE announced on August 26 its selection of 25 cost-shared projects under the Clean Cities program that will be funded with nearly $300 million from ARRA. They will speed the transformation of the nation’s vehicle fleet, putting more than 9,000 alternative fuel and energy efficient vehicles on the road, while establishing 542 alternative fuel stations across the country.
One grant will also support new propane fueling stations along a corridor running from Washington, D.C., to Florida and on to Mississippi. The new projects will displace an estimated 38 million gallons of petroleum per year.
The Clean Cities program is a government-industry partnership that works to reduce U.S. petroleum consumption in the transportation sector – its partners are matching every Recovery Act dollar with two from other sources. The grants will fund a range of energy efficient and advanced vehicle technologies, such as hybrids, EVs, plug-ins, hydraulic hybrids, and compressed natural gas vehicles.
The funds also support new refueling infrastructure for various alternative fuels, including biofuels and natural gas. Other efforts include public education and training outreach to further the program’s goal. See the DOE press release and a map of the awardees (PDF 82 KB).
DOE Sets Energy Standards for Beverage Vending Machines
Making the 2.3 million beverage vending machines in the US more efficient will reduce GHG emissions and increase energy security while saving money. DOE published the first energy efficiency standards for this group of appliances on August 31 and take effect in 2012. Over the following 30 years, DOE estimates they will save about 0.159 quadrillion British thermal units (Btu) of energy (also known as "quads"), while saving vendors between $1.1 billion and $1.6 billion. For comparison, the US currently uses roughly 100 quads of energy per year.
The standards are one of five energy efficiency standards that President Obama called on DOE to expedite in a Presidential memorandum issued in February, and DOE has now finalized all of them. The other efficiency standards were for dishwashers and general service incandescent lamps; microwaves and electric and gas kitchen ranges and ovens; commercial boilers and air conditioning equipment; and general service fluorescent lamps and incandescent reflector lamps. See the DOE press release, the Presidential memo, and the final rule as published in the Federal Register.
"Cash for Clunkers" Replaces 700,000 Vehicles with More Efficient Models
The popular "Cash for Clunkers" program ended its brief run on August 25, and is estimated to have removed nearly 700,000 inefficient vehicles from U.S. roads.
It achieved greater fuel economy gains than originally expected, as consumers chose more fuel-efficient models than were required by the program. In fact, the average fuel economy of traded-in vehicles, which were crushed, was 15.8 miles per gallon (mpg), while the average fuel economy of newly purchased vehicles was 24.9 mpg. That’s a fuel economy gain of 9.1 mpg, or 58%.
That figure makes sense for trade-ins of old cars for new cars, because they earned the maximum rebate with a 10 mpg increase in fuel economy. However, analysts expected trade-ins of light trucks (SUVs, pickups, and vans) for new light trucks to drag down fuel economy gains, as such trade-ins could earn the maximum rebate with a fuel economy gain of only 5 mpg.
But according to the U.S. Dept. of Transportation (DOT), truck-for-truck trade-ins were less common than expected – 84% of program participants traded in trucks, but only 41% purchased new trucks, the rest purchased cars. And 8,134 heavy work trucks were traded in, but only 2,408 new heavy work trucks were purchased; 116,909 large pickups or vans were traded in, but only 46,838 new ones were purchased. The fuel economy of newly purchased cars was 19% greater than the average fuel economy of all new cars available in the US. See the DOT press release and the article from this newsletter on the program rules.
According to DOT, the top vehicles traded in under the program: SUVs, pickups, and vans from Ford, Jeep, Dodge, and Chevrolet. The top 10 new vehicles purchased: cars from Toyota, Honda, Hyundai, Nissan and Ford – the Ford Focus and Ford Escape made the top-10 list. Ford boosted production of the vehicles to meet demand and had year-over-year sales increases in both July and August.
Toyota’s Corolla, Camry, and Prius were on the top-10 list. The company estimates it accounted for nearly a third of the fuel savings achieved by the program. Honda’s sales of the Fit nearly doubled and will increase production at two US plants. GM also gained, with a 159% year-over-year increase in August sales of the Chevy Aveo, a 13.8% increase in Chevy Cobalt sales, a near doubling in Chevy Equinox sales, and a 26% boost in Chevy HHR sales. GM plans to increase production to restock inventories. Chrysler also credited the program with increased sales and raised its production by 50,000 vehicles. See the Ford press releases on its production increases and sales increases, and the press releases from Toyota, Honda, GM, and Chrysler.
DOE Awards $21M to Five Projects for Biomass Processing
DOE will award up to $21 million to five projects for handling and delivering high-tonnage biomass feedstocks to producers of cellulosic biofuels. The awards were selected as the best projects to stimulate the design and demonstration of a comprehensive system to handle the harvesting, collection, preprocessing, transport, and storage of sufficient volumes of sustainably produced feedstocks.
Potential biomass feedstocks include agricultural residues, energy crops (switchgrass, miscanthus, sugarcane, sorghum, poplar, and willow), forest resources (forest thinnings, wood chips, wood wastes, and small diameter trees), and urban wood wastes.
The Agco Corporation will demonstrate the viability of its densified, large-square-bale supply system, which the company plans to deploy at cellulosic biorefineries operated by POET in Emmetsburg, Iowa; by Abengoa Bioenergy in Hugoton, Kansas; and by Terrabon in Byron, Texas. FDC Enterprises Inc. will also support the Abengoa Bioenergy facility by testing a mowing and baling system, a bale-picking truck, and a self-loading trailer for biomass crops, while Genera Energy will develop a system for handling switchgrass.
For woody biomass, Alabama’s Auburn University will work with leading forest product companies to design and demonstrate a high-productivity system to harvest, process, and transport woody biomass from southern pine plantations. And the College of Environmental Science and Forestry at the State University of New York will take on short-rotation wood crops with a single-pass cut-and-chip harvester. See the DOE press release and the DOE Biomass Program Web site.
USDA Awards $4.2M for Woody Biomass Removal
The USDA awarded grants for 17 woody biomass removal projects as part of a plan to improve the health of national forests. The USDA tapped small businesses and community groups to develop innovative uses for woody biomass collected from hazardous fuel reduction projects in the forests. The funds are designed to find ways to turn residues such as small-diameter material and low-valued trees into marketable forest products.
The Forest Service Woody Biomass Utilization grant program has been in effect since 2005, and has provided over $26.3 million towards various projects ranging from biomass boilers for schools and prisons, to assisting businesses acquire equipment that improves processing efficiencies. See the USDA press release and the program Web site.
The USDA’s Farm Service Agency also made the first matching payment under its new Biomass Crop Assistance Program (BCAP). The Show Me Energy Cooperative of Missouri was the first biomass conversion facility that qualified under BCAP, a 2008 Farm Bill program. Less than a month later, BCAP provided matching funds to one of more than 500 biomass producers that are being paid by the energy cooperative.
The firm produces fuel pellets from agricultural waste products, such as switchgrass, straw, corn stover, sawdust, woodchips, and other biomass materials. The pellets heat houses and livestock facilities, and Kansas Power & Light Company’s Sibley plant is testing them to determine if the biomass fuel could supplement coal for generating electricity. BCAP provides financial assistance to farmers who are growing biomass crops to support energy facilities, biorefineries, or manufacturers of biobased products. The BCAP Web site currently lists five eligible biomass facilities, including three in California and one in New York. See the USDA press release and the BCAP Web site.
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EREE Network News is a weekly publication of the U.S. Department of Energy’s Office of Energy Efficiency and Renewable Energy (EERE).
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