Energy Update

February 2010

With global population growth expected to continue until mid-way through this century, total energy demands will rise by a half over the next twenty-five years.

Can existing energy reserves actually supply future demand? What alternatives exist?

What kinds of new geopolitical challenges are associated with the search for energy security?

In the Members' Area:

• Fossil fuels update

• Technology brings new energy sources

• Geopolitics and energy supply issues

• Student activities (suitable for AQA and other specifications)

Fossil fuels update

Is the “peak oil” moment nearly here? Recently there have been many new reports of fresh oil field discoveries, while technological breakthroughs may allow previously untapped “dirty” sources – such as Canada’s tar sands - to be brought into production.

Does anyone really know how much oil – as well as other fossil fuels, including coal and gas - is left out there?

Fossil fuels are a non–renewable resource, meaning that there is only a fixed amount that can be discovered and used. No-one really knows exactly how large the Earth’s reserves are, leading some experts to question whether the moment of peak oil production has already passed.

However, demand is growing all the time, despite the efforts of many nations and individuals to try and save energy and live more sustainably. Energy consumption in Europe and North America continues to increase. Global demand is now being driven even higher by the ever-growing need for fuel in rapidly-industrialising India and China, both of whom have enormous populations, each in excess of one billion.

Chinese demand for oil has been rising by around 10% each year, in line with its industrial output. Can any further significant increases in Chinese and Indian demand actually be met?

New oil fields

How much fossil fuel remains is guesswork rather than science. Energy consultant Daniel Yergin argues that “we’re supposed to be running out. But new technologies have made it possible for oil companies to find new sources of oil and extract new oil from old sources”. But other experts disagree and say that soon it will all be gone. Even the major oil companies have divergent opinions.

The Financial Times (18 September 2009) reports on a number of significant new recent discoveries stretching from Brazil to Sierra Leone. Amongst the most important recent finds are:

• A whole new oil basin stretching 1,000 km from the coast of Ghana to Sierra Leone - it could hold 1.8bn barrels of oil.

• New big finds in Brazil where oil has been discovered in a layer of very deep rock in the Gulf of Mexico (in the Campos Basin). BP believes this could hold 50bn barrels, allowing Brazil to double its output to 3.8m barrels a day within a decade.

Other fossil fuel options

Although conventional supplies of oil, gas and coal may soon face exhaustion, there are additional types of fossil fuel that might be used as energy sources, including tar sands and methane hydrates. New technologies might also be used to reduce the environmental impact of future coal burning using a process called coal gasification.

• Methane hydrates This is a form of crystallised gas that Japan, India, Korea and the US are all researching. Large deposits underlie the Gulf of Mexico that could potentially supply the US with gas for decades, if scientists can work out a way to harness this natural resource.

• Tar sands Reserves of tar sand in Canada are larger than the oil supplies of Saudi Arabia. Currently, they are expensive to purify. However, Shell, Chevron, Exxon, Total, Occidental and Imperial have so far invested nearly £50bn in the 3,000 square kilometre ‘bitumen belt’ and by 2050 Canada could be the second largest oil producer in the world. However, the environmental devastation left behind is already truly shocking. The Guardian (12 July 2008) reports that “the vast landscape of forests and lakes around Fort McMurray and the Athabasca river… is now pitted with hundreds of square kilometres of toxic waste ponds, mines that are 300ft deep, hundreds of miles of pipes and burgeoning petrochemical works. Every day brings a bumper to bumper stream of lorries carrying the world's largest plant, pipes and machinery to the area, as well as young men seeking fortunes, and, say critics, the devastation of a pristine land…The surge is expected to attract 100,000 more workers to the northern wilderness where the wolf and bear are still common”.

• Coal gasification The process of converting coal into combustible gases may become widely used in the future if the technology can be perfected that will allow the excess CO2 produced to be pumped deep into the earth. The current UK government is keen to include coal as part of the future UK energy mix, as the Times (20 April 2009) reports. Ed Miliband, the Energy and Climate Change Secretary, has recently backed funding for more clean coal research at a demonstration power plant.

How is oil made?

Oil is a non-renewable resource. Viewed from a human point of view, it is the product of a very lucky chain of events:

“The first break came in a life-rich sea: sediments buried the organic material raining down on the sea floor faster than it could decay. The next break: eons later, the seafloor sediments ended up at just the right depth – generally between 7,500 and 15,000 feet – for heat and pressure to slow-cook the organic material into oil. Then the oil collected in a ‘trap’ of porous sandstone or limestone and an impermeable cap of shale or salt kept it from escaping.”

[National Geographic, June 2004]

Technology brings new energy sources

Writers sometimes use the phrase “technological fix” to describe the belief or expectation that technology will deliver humanity from many of its most pressing problems.

This is especially true of energy shortages, and throughout 2009 the media constantly reported on a range of interesting new developments in the hi-tech field of renewable energy (a category which – controversially, in some people’s view - includes nuclear energy).

1. Solar power In the September 2009 edition of National Geographic magazine, a solar power expert states that: “The total power needs of the humans on Earth is approximately 16 terawatts (a terawatt is a trillion watts.) In the year 2020 it is expected to grow to 20 terawatts. The sunshine on the solid part of the Earth is 120,000 terawatts. From this perspective, energy from the sun is virtually unlimited.” There are two main ways to harness solar energy:

   • Steam production using computer-guided mirrors, called heliostats, to focus sunlight on a receiver that sits atop a tall “power tower” (This can be seen in Nevada, US).

   • Direct electricity production from sunlight using large photovoltaic (PV) panels made of semiconductors (such as silicon). 
     
     Back in the 1970s, solar power was seen as an important future energy source. However, a massive fall in global oil prices (after the Iran-Iraq war of 1980) meant that there was less funding for solar research available as there was little immediate urgency to investigate renewables. An entire generation of scientists was instead diverted into microprocessor, software and computer research – making enormous strides there in the last 20-30 years.Now the hope is that the pressing problem of climate change will entice a new generation of young scientists back to solar research – and perhaps the amazing leaps forward recently seen in computing technology can be replicated, given sufficient funding and profit potential.The US, Germany and Spain are current market leaders in solar energy but there could be exciting prospects for hot arid areas such as North Africa. The Sahara Forest Project is worth investigating – a plan to generate enormous amounts of energy in what is currently one of the poorest areas of the world. The world map of energy haves and have-nots could be completely re-drawn if solar takes off to become a leading global energy source.

2. Photosynthesis: the ultimate technology?Imperial College and Californian researchers are hoping to mimic the photosynthesis process using an “artificial leaf”. They aim to discover exactly how leaves use sunlight to make useful molecules. “The team then plans to build artificial systems that can do the same to generate clean fuels such as hydrogen and methanol. These would then be used in fuel cells to make electricity or directly to power super-clean vehicles” (Guardian, 12 August 2009). For students taking Biology alongside Geography, this is clearly a great story to investigate further.

3. China’s wind-powered desert China is inverting heavily in wind turbines. Demand for energy there is growing so rapidly that the nation has real concerns with its own energy security –by 2040 the Chinese people will be emitting 3.5 bn tn of carbon, compared with just 0.8 bn tn in 2000, representing a great leap forwards in energy consumption. The Financial Times (17 April 2009) reports that China has its eye on renewables; it became the world’s fourth-largest wind turbine market in 2008 after more than doubling its total installed capacity to more than 12,000MW – with a growth rate that put it more than three times ahead of the rest of the world.
   
   Wind turbines work by converting the kinetic energy found in naturally occurring wind into mechanical energy. If the mechanical energy is used directly to drive machinery then the machine is usually called a windmill. If the mechanical energy is converted instead to stored electricity, then the machine is called a wind generator.
   
   China has plenty of wind to drive either type. Specifically, it is the grasslands of sparsely populated Inner Mongolia where thousands of new turbines have been erected. At its new plant in Hohhot, the Danish TNC Vestas is making smaller-than-normal turbines but with bigger blades. These machines have been specially designed to respond efficiently to “the steady low to medium-strength winds that occur in Inner Mongolia” (Financial Times, 17 April 2009). This is an especially interesting example of glocalisation by a TNC.
   
   Wind turbines offer a number of advantages as an energy source. The fuel is free and will never run out. And compared with burning fossil fuel, the electricity generated from a single wind turbine in a year prevents the emission of 4,000 tonnes of CO2. Tens of thousands of modern wind turbines already successfully operate throughout the world. Denmark gets 18% of its energy from this source.
   
   However, they simply cannot provided anything like enough energy yet to replace fossil fuels globally. Critics also say turbines generate a small amount of energy in relation to the damage to the landscape that they cause (giant industrial machines are being placed in often unspoilt rural landscapes).

4. Bolivia’s lithium bonanza A recent report in the Guardian newspaper (18 June 2009) states that half the world’s supplies of lithium – the metallic element used to make batteries in electric cars - lies below salt flats in Bolivia. 5.4 million tonnes of the substance is found there and it is the key to the technology some people believe will make clean (non-fossil fuel) electricity a reality.
   
   Already, Li-ion cells are used for laptops and mobiles, creating a light and long-life rechargeable battery supply. Most experimental electronic cars use some kind of Li-ion batteries although scientists still need to reduce battery size.

5. Nuclear power revisitedIn a controversial article published in New Statesman (22 September 2008), leading environmentalist Mark Lynas publicly embraced nuclear power. Previously an anti-nuclear campaigner, he now believes that “the hard truth is that if nuclear power is not part of the answer, then answering the (energy) challenge is going to be very difficult indeed”. Is he right? The original article – and the many comments posted – is worth reading
   
   Nuclear energy is produced when a continuous supply of heat is generated from the radioactive decay of a fissile material, often uranium-235. This heat is used to boil water, produce steam, and drive a steam turbine which generates electricity.
   
   From a UK government perspective, building more nuclear stations is a quick way to meet our national “energy gap”. Moreover:

   • Nuclear stations do not significantly contribute to global warming.

   • Recent political events involving Russian gas supplies and Middle Eastern oil have both raised fresh concerns over the UK’s level of energy security. Greater home production of nuclear power could makes future energy supplies more reliable and less vulnerable to foreign affairs. This reasoning is similar to France’s decision to develop its own nuclear stations after the “oil shocks” of the 1970s.

However, many people in the UK still do not want to see greater reliance on nuclear energy, for three key reasons:

• Disposal Nuclear waste is notoriously hard and costly to dispose of. This is because radioactive materials remain dangerous for up to hundreds of thousands of years after they have ceased to be useful. Even in the deepest underground stores, there is a possibility of groundwater seepage via joints and bedding planes in the rock. This could allow contaminated water to enter the hydrological cycle and food chains.

• Cost Whatever method of disposal is eventually used, the cost will be high. Since the 1950s, the UK has placed 2.3 million cubic metres of civil and military nuclear waste into temporary storage. In 2006, the Independent newspaper claimed that the cost of permanent safe disposal for these existing wastes could reach £85 billion.

• Danger The risk of a major accident is more worrying with nuclear power than for conventional energy sources. Past world nuclear disasters in Chernobyl (Ukraine) and Three Mile Island (US) are still remembered. In Chernobyl, where a nuclear plant exploded in 1986, many people whose parents were exposed to radiation have been born with disabilities. The cost of the disaster to Ukraine has been around $120 billion

Geopolitics and energy supply issues

The changing political geography of energy reflects the fears that now surround the long-term prospect of diminishing supplies. New friendships are being created and old ones threatened in a globalised world of energy exchanges. Recently, Chinese oil companies have began making new moves into Africa. Meanwhile, energy geopolitics in eastern Europe are heated.

Nations worry about energy security. Governments have every right to be concerned that high dependence on imports of oil, coal and gas will make them vulnerable to outside forces. What if their suppliers stop providing, perhaps as part of a wider conflict or because other customers offer more money?

• European nations were left feeling very powerless and vulnerable when their gas supplies from Russia were temporarily interrupted in 2006. Politicians throughout Europe are already arguing that the EU needs to diversify its energy resources and produce more of its own power – so that outside agencies cannot “turn off the switch” during times of international unrest or conflict. This drive for self-sufficiency is leading to calls for more wind farms, greater investment in biofuels and possibly a return to nuclear power.

• Many people believe that US foreign policy in the Middle East continues to be strongly related to American reliance upon oil supplies from this region. President Obama may be maintaining American influence in the region partly to safeguard US supplies, especially now that the demand for Middle Eastern oil in China is rising.

• One interesting geopolitical development in 2009 has been the announcement that China is seeking to buy greater stakes in African oil. The Financial Times describes China as “scrambling for oil” after a bid to gain financial control of one sixth of oil giant Nigeria’s reserves – a move certain to court controversy given the vested interests of western companies like Shell in the region. Angola and Sudan already provide China with oil and in October 2009 billion-dollar negotiations began with Guinea’s military leaders over Chinese oil rights there. However, human rights groups are concerned that the ruling Guinean army have recently massacred civilian demonstrators. This latest development “raises fresh questions about the willingness of Chinese groups to prop up rogue African governments” (Financial Times, 12 October 2009). Chinese and western oil companies are also reported to be competing for exploitation rights in Ghana.

Read Prof Mike Bradshaw's responses to the questions that students sent in on energy security

Student Activity

Discuss reasons why global patterns of energy use are changing. (15 marks)

Examiner’s tip:

There are several ways of approaching this – try to discuss the different types of energy appearing on the changing world energy map as well as changes in total energy consumption (such as much bigger use in China). That way you can touch on two important issues – firstly, the challenge of climate change and the need to switch to greater use of renewable energy. Secondly, rising affluence in emerging economies means greater energy use in continents other than Europe and North America.

Discuss reasons why energy can be a cause for both geopolitical conflict and geopolitical co-operation. (15 marks)

Examiner’s tip:

Try to give a balanced answer that deals equally with conflict and co-operation. Conflict ideas include new energy pathways (e.g. from Africa to Asia) interfering with the interests of western oil companies aiming to supply European and American markets. Any discussion of co-operation could include an analysis of the challenge of climate change and efforts to reduce fossil fuel usage (perhaps mentioning Kyoto Agreement but also looking ahead to Copenhagen). The role of OPEC might also be discussed.

Written by Dr Simon Oakes, a senior A-level and International Baccalaureate examiner, who teaches at Bancroft’s School, Essex