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William O'Keefe
CEO, George C. Marshall Institute

William O'Keefe

William O'Keefe is CEO at the George C. Marshall Institute, a think tank that promotes better use of science in public policy. He is a former COO at the American Petroleum Institute.


Kerry-Lieberman natural gas provision is a loser

Q: The Kerry-Lieberman climate bill would provide tax incentives for converting vehicles to burn natural gas. How large a role should natural gas play in the switch to a low-carbon economy, and in a Senate climate bill?

This provision lacks energy and economic logic and justification. It is just one more example of the effort to buy support for a bad climate bill and reward special interests with taxpayer dollars. Like the tax credit for ethanol, this provision is just another subsidy for an action that cannot stand on its own.

At a time when we are facing a serious fiscal crisis, it is irresponsible to continue the politics of buying support by transferring wealth from taxpayers to special interests. Eventually, giveaways like this are paid for with higher taxes or larger deficits, both of which will make our financial crisis worse.

Natural gas-powered vehicles don't have any trunk space because of the size of the fuel tanks that they require. In addition to requiring much larger fuel tanks, these vehicles do not have the range of a gasoline or diesel powered vehicle. The typical family of four would not find it possible to enjoy the mobility that they do today.

There may be a role for natural gas powered buses and other centrally fueled vehicles, like delivery trucks, in areas where air quality is a concern. But, as a general policy, natural gas for transportation will not survive objective scrutiny. It is not cost-effective and does not represent the highest valued use for natural gas.

The best use for our large reserves of unconventional natural gas is electric power generation. Replacing coal power with natural gas will lower carbon emissions and improve air quality. This will not happen quickly because of the large capital stock of coal powered generation but it is the direction that power generation should take along with greater reliance on nuclear power.

Proponents of using natural gas to replace imported oil should turn their attention and research efforts to improving the technology and lowering the cost of coal liquefaction. The great abundance of coal could be used to produce large quantities of liquid fuel if technology could be advanced from its current state. Government sponsored research in coal to liquids has languished this decade. It is time to give it a higher priority. Improvements in technology could lower the cost and perhaps make coal based liquids cost competitive with petroleum based fuels.

The Kerry-Lieberman bill is poor climate and energy policy. It should be buried and rest in peace.

By William O'Keefe  |  May 21, 2010; 4:16 PM ET Save & Share:  Send E-mail   Facebook   Twitter   Digg   Yahoo Buzz   StumbleUpon   Technorati  
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"The great abundance of coal could be used to produce large quantities of liquid fuel if technology could be advanced from its current state."

Here O'Keefe acknowledges coal liquification is not ready for prime time. No one advocates suspending research on advanced coal uses HOWEVER:

On thing that America has IS Natural Gas, and it has it in abundance, gas reserves amount to the equivelent to 700 billion gallons of oil.

The technology for using Natural Gas as an oil replacement is here right now. Cost to convert a typical mid-sized sedan is about $2000 -many firms already offer the equipment, the conversion is easy.

The installation can be set up as a duel or triple fuel system to get advantages of up to at least three fuel sources. Natural Gas use in Hybrids would push hybrids from just matching the best milage conventional cars to outright beating them.

Yes, there is a range impact due to less energy density.

But more than offsetting that is the fact that Natural Gas is much cleaner burning and is far easier on the engine. You get a triple advantage of lower maintance costs, lower fuel cost and a big environmental improvements over reliance on oil.

The infrastructure needed for LNG distribution could be ramped up quickly.

Add to that the fact that the Gulf Oil Disaster is a game changer.

Given the fact that dual or even triple fuel capability (LNG, LPG, Petroleum) would help offset the lessened range, the benefits far offset any issues of convience.

When one fully burdens ALL the costs of pertoleum -the public paying the cost of both sides of a war on terror, the environmental costs, political costs, etc., the assertion that Natural Gas is not cost effective is just plain wrong. Natural Gas in the one investment that we can implement relatively quickly, would pay back quickly, would immediatly give us energy independence, and would give us the time to bring other alternatives online.

Posted by: plaza04433 | May 29, 2010 3:39 PM
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