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Houston Chronicle: Delivering is called key for alternative fuels

Analyst tells energy executives environment is right for success

By KRISTEN HAYS
Copyright 2007 Houston Chronicle

Alternative energy isn’t the next big thing.

That’s because it’s already here, an analyst told energy executives in Houston on Friday.

The key for the ever-growing alternatives sector is to deliver, particularly when the current political environment is encouraging and high energy prices — in addition to subsidies — make such investments more economical, Simmons & Company International analyst Pearce Hammond said.

“I firmly believe the biggest challenge alternative energy has in front of it now is to execute,” he said.

Paul Dickerson, chief operating officer for the Energy Department’s office of energy efficiency and renewable energy, said that investment in technology to widen the scope of renewables that can be turned into fuel is critical to diversifying the nation’s energy sources.

“For the first time in our lives, being green is not a partisan issue,” Dickerson said. “It is in our vital interests to diversify the United States’ energy supply, and the way forward is through technology.”

Both men spoke at a half-day conference focused on biofuels and wind energy.

President Bush has promoted ethanol as a key driver in reducing gasoline consumption by 20 percent in the next decade. He has called for replacing a portion of the amount of gasoline Americans are expected to consume by 2017 with 35 billion gallons of ethanol and other alternative fuels.

Congressional mandate

Congress has already mandated that the country’s fuel supply contain at least 7.5 billion gallons of ethanol by 2012.

According to the Energy Information Administration, about 5 billion gallons of ethanol was part of 175 billion gallons of fuels in the U.S. from all sources last year.

The Energy Information Administration projects that U.S. ethanol use will grow to 14.6 billion gallons per year by 2030, most of which will be made from corn. Consumption of biodiesel, which is made mainly with soybean oil in the U.S., is expected to rise to 400 million gallons per year from last year’s 91 million gallons in the same time span.

But replacing gasoline consumption with alternatives will take time, said Pamela Beall, organizational vice president of business development at Marathon Oil Corp., an ethanol plant investor and the nation’s fifth-largest refiner.

Technology to create more ethanol from non-food sources, such as cellulose or switchgrass, is years away, she said. The nation’s pipelines and other energy infrastructure cannot transport biodiesel, so it must be moved by truck or rail.

Bill Spence, president of Standard Renewable Energy’s BioSelect Fuels division, which will operate a new biodiesel plant in Galveston, said the industry is working on technology and use of different crops to fill the gap between the goal and what can be produced with corn.

“We’re just not there yet. Technology will be the solution to that,” he said.

Stressed infrastructure

Alan Forster, manager of joint ventures and emerging markets for Shell WindEnergy, said a hindrance to growth includes a stressed infrastructure.

While 1.5 percent of the total energy generation worldwide comes from wind, the U.S. is a growth market, and wind projects are economically viable with subsidies, Forster said. The same is said of biofuels.

But he said investment in energy transmission is needed to keep up with growth and demand.

“We have not invested in transmission in the United States in 20 years,” he said.

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VOICES OF HOUSTON
 
 johnadonovan wrote:

What counts is deeds not words, especially when it comes to Big Oil. The environmental track record of Royal Dutch Shell in particular does not inspire confidence. The Clean Air Act violations, repeated environmental infringements in Louisiana, a pipeline rupture in Washington State which resulted in an explosion and more deaths, repeated multimillion dollar fines for groundwater contamination, more fines for unauthorised venting and flaring of gas. Details can be found on an updated Wikipedia article at

http://en.wikipedia.org/wiki/Controversies_surrounding_Royal_Dutch_Shell

Posted by John Donovan, co-owner of the website: http://royaldutchshellplc.com/

5/20/2007 3:49:50 AM
http://www.chron.com/disp/story.mpl/business/4817954.html
Article published: May 18, 2007, 11:37PM

royaldutchshellplc.com and its sister websites royaldutchshellgroup.com, shellenergy.website, shellnazihistory.com, royaldutchshell.website, johndonovan.website, shellnews.net and shell2004.com are all owned by John Donovan. There is also a Wikipedia article.

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