John v Scanlan

3 August 2003

Memorandum
From: John Scanlan
Re: Five year energy plan for the United States

“Energy” is commonly used as a homogenous term to refer to all energy sources1 and
transmission forms. Unfortunately, most energy planing is based on this idea that energy is a
homogenous lump. Hydrogen is frequently touted as a miracle fuel for automobiles. However,
more fossil fuel is required to produce hydrogen from water than the hydrogen can provide to a
vehicle. Currently we use a great deal of natural gas to power electrical plants. We need to ask
ourselves: When supplies of natural gas are limited, should we be using this highly portable and
explosive fuel to make electricity to power lighting and appliances which need no portability and no
explosive force? Shouldn’t wind, solar, thermal, wave, etc. power be used to make electricity and
hydrogen instead of limited sources like oil and gas?

The Plan

There are several preliminary factors to a national energy plan; (1) The duration of the plan; (2)
The goals of the plan; (3) The definition of “energy” for the purposes of this plan; and (4) The breadth of
the plan.

1. Energy “sources” are different from energy “resources” in that a resource is replenishable. Wind, solar, thermal, wave,
etc. are replenishable sources of energy. Oil and gas are not replenishable and thus merely “sources.”

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3 August 2003

Unlike the short-term energy plans with which the government is content, we need to plan for the
long-term. Because fossil fuels are limited, although not severely, and technological innovation is a slow
process, we need to plan for a period after fossil fuels have been largely depleted. The 1995 National
Energy Policy Act, ENERGY LAW AND POLICY, p6-32, and the 1998 Department of Energy Strategic Plan,
ENERGY LAW AND POLICY, p6-33, are both shortsighted. Neither, except for vague statements about
desiring alternative energy sources, looks far enough into the future. Therefore, rather than the five to ten
year plans that we have had in the past, we need a one-hundred year plan.

Our plan needs to provide energy sufficient to meet both energy use and peak demand. Our energy
policy needs to meet the goals of “sustainable development,” to meet the “developmental and
environmental needs of present and future generations.” Rio Declaration, Princ. 3. Finally, our energy
policy needs to be in cooperation with the international community.

In formulating this policy, we will not make a distinction between forms of energy. We will,
however, differentiate the different uses of energy. For example, because electricity exists in nature only in
lightning, electricity will be treated as a method of using energy rather than a fuel.

This plan needs to be broad. Every part of the energy life cycle effects all of our goals. Therefore,
the plan needs to incorporate the entire life cycle of energy, from exploration to waste disposal.

Factors to Consider

First, we need to differentiate the different uses of energy. The attached Figure 1 shows typical
uses of energy along with the primary features of their uses. Each use has three primary features: (1)
Portability, the need to transport energy; (2) Power, the instantaneous burst of energy required; and (3)
Heat, the temperature needed. For example, energy must be transported with an automobile, a space-
shuttle requires a tremendous burst of energy, and a Bessemer furnace requires temperatures in excess of
3,000 degrees F.

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3 August 2003

Certain energy sources are superior to others for specific uses. See Figure 2. Liquid fuels are
superior for portability while electricity, has poor portability.2 Fossil fuels are superior at creating heat.
Electric elements could not produce the extremely high temperatures required for a Bessemer furnace. Our
National Energy Policy must balance different uses with sources.

Recommendations

CONSERVATION

Irrespective of recent remarks by the Government suggesting the energy conservation is a dead end,
conservation will be critical to meeting demand.3

Buildings are critical to energy conservation. First, to reduce peak demand, we need to continue
our efforts at electrical load shifting.4 To reduce energy use, we need to continue our efforts to develop
efficient lighting, appliances, etc.5 The use of the building codes have been and will continue to be useful
in reducing electrical use.6

2. Electricity must be transported by either a hard connection or by storage batteries.

3. Rather than the “personal virtue” of turning off the lights and driving less, as Dick Cheney used the word with tongue in
cheek, conservation refers to finding better ways to use energy.

4. Shifting electrical use away from peak air conditioning time to nighttime.

5. A fascinating trend is to plant grass, bushes, and trees on the roofs of downtown buildings. The flora eats greenhouse
gases and is wonderful insulation.

6. For example: The code requirement for efficient “T-8" lamps in flourescent lighting.

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We also need to continue our efforts at conserving energy in transportation. We need to use the
power of Government to increase the number of hybrid autos on the road.7 Trucks can make even better
use of the same hybrid technology.8 There is expected be an experimental flight, this month, of an airplane
with a “ram-jet” engine.9 This ram-jet could greatly reduce the need for airplane fuel, and the associated
pollution.

Energy can also be conserved in manufacturing facilities. Many high energy consumption
processes can be shifted to the night shifts to reduce peak demand. Many processes produce sufficient
excess heat or power to be used for co-generation. For example, the heat from a finishing processes can be
used to preheat fresh air or water. This heat can also be fed back into the finishing process itself as preheat.
Manufacturers can also make their own electricity and get heat from the process for co-generation. Co-
generation making both electricity and heat has the added benefit of removing the plant from the power
grid.10

ENERGY SOURCE SHIFTING

Shifting energy sources can also greatly reduce peak demand and use. Most homes and
commercial buildings do not need to be on the power grid. See Table 1. Because buildings require no
portability of energy, buildings can have rather bulky, permanently anchored, energy production devices.
Uses which can be considered low power, can use low power energy sources. See Table 1.

7. Hybrid internal-combustion / electric automobiles store the excess energy created by the engine when idling for later
use.

8. Hybrid technology was first developed for use in earth-moving trucks.

9. A ram-jet engine is extremely efficient because of the high compression of the air passing through it at ignition.

10. A plant would need to remain connected to the grid for emergency situations, but would normally not use power from
the grid.

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Solar power is already efficient for some home uses. However, photovoltaic cells produce direct
current (DC). If DC lighting and appliances are developed to a marketable product, most home electricity
use could be shifted off of the power grid. Dishwashers, stoves, refrigerators, and possibly air conditioning
could be removed from the power grid. The same could happen in many commercial office buildings.11 Of
course, each building would require a connection to the grid with a DC converter for days when the
photovoltaic system is not fully operational and storage has been depleted.

Solar thermal systems do not produce electricity, but rather heat. This heat can be used for heating
air or water. There is frequently sufficient heat from a solar thermal system to heat the house. Solar
thermal system can, at minimum, provide preheat for air or water, greatly reducing the electricity or natural
gas used therefor.

Geothermal and wave energy are also promising alternatives. Geothermal can be used in similar
ways to solar thermal systems.12 Wave energy has sufficient power to turn turbines for the production of
electricity.

TRANSMISSION SYSTEM IMPROVEMENTS

Electrical reliability needs a great deal of improvement. Transmission lines designed for the
movement of small amounts of power are now being used for wholesale power trading.13 These lines all
need to be upgraded for wholesale power transmission.

11. Commercial air-conditioning would need to stay on the grid due to high voltages required. Air-conditioning, however
makes up less than half of a building’s electricity use.

12. Ground loop heat pumps already heat and cool homes and offices by transferring heat the earth.

13. A major cause of the Western States blackout in 1997 was excess heat generated by transmitting more power over
the lines than they were designed for.

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Further, the interconnect areas need to be connected. As population shifts toward the Southern
States, connecting Texas with the East and West can achieve greater reliability and efficiency.
Interconnections throughout North America, including Mexico and all of Canada should be considered in
light of NAFTA.

While new natural gas pipelines may be necessary in the Western States, the US natural gas
pipeline system is largely adequate. These lines all require major maintenance upgrades however. The
same is true for the existing oil pipeline system.

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GENERATION IMPROVEMENTS

Once we’ve cleaned up the bottlenecks in the transmission systems, we need to find additional
capacity. Additional generation must be environmentally prudent and in accordance with international
agreements.

The cleanest electrical generation would be nuclear power. Nuclear does not have the CO2 effects
of coal, oil, or natural gas generation. Nuclear also does not have the negative effects on water systems that
hydropower does. There are problems of nuclear waste and heat pollution need to be resolved, however.

Accompanying expanded use of nuclear power must be a program for recycling nuclear waste and
disposal of final wastes. It has taken decades to get approval for a final dump site, and, in the meantime,
little has been done to create a recycling program. Therefore, before we start building nuclear power plants
again, these programs must be put into place.

The other major issue is heat pollution in the waters. Nuclear plants require a great deal of cooling.
This heat is rejected into nearby waters. Again, we must find a way to use this heat for cogeneration, rather
than just dumping it into the waters.14

CITY PLANNING

City planning also plays a large role in energy consumption. Just in the area of transportation, city
planning can eliminate a great deal of energy use. Multiple zoning districts reduce travel by placing
“everything” within either walking or short-drive distance. The need for large powerful automobiles will
also diminish. Once less powerful autos are acceptable, automobiles can make greater use of cleaner

14. One possibility is to deliver heated water, along with cold water to nearby homes and businesses.

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energy sources, like electrical storage and fuel cells. Walking can also reduce the weight carried by
automobiles when we need to use them.

MARKET CONDITIONS

The final issue is how to achieve our goals. At the ends of the spectrum; 1) our government could
nationalize the energy industry, or 2) our government could take a complete laissez-faire approach. Neither
of these will work. Looking at the strengths of the market and of government, there are places for the
government to be involved.

The Federal Government must be involved in the meeting of international agreements. The United
States was the first country to ratify the Framework Convention on Climate Change (FCCC) and even
though not yet ratified, our signature on the Kyoto Protocol creates certain obligations.15 The market
has shown that it is not a good protector of the environment. The market tends to operate in the short term,
and to externalize societal costs. Therefore, the Federal Government must set environmental standards in a
way that emphasizes the long term and internalizes societal costs.

Further, the Government must promote capitalist values. It has been shown that competition is one
of greatest motivators toward innovation and customer service. Unfortunately, the current situation is one
of an oligopolistic market. There are few energy companies in comparison with the size of the market, and
the number is growing fewer. The explanation for the need for huge companies is that they can better
absorb the risks involved with exploration and capital construction. If the Government, using its economic
size, were to assume some of the financial risk, energy companies could be much smaller. Smaller
companies will lead to greater competition, and thus greater innovation and customer service.

15. A government that has signed an agreement is obligated to not take action that would defeat the purpose of the
agreement. Vienna Convention on Treaties.

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First, the Government should help finance transmission systems upgrades. The transmission lines
would then be leased, including the responsibility for upkeep through a short-term lease bidding process.
Second, exploration should be backed by the size of the Government. By alleviating some of the risk,
smaller companies can compete and survive economic disasters, thus eliminating the need for huge,
inherently anti-competitive companies..

Generation plants need to be built. New plants need to replace old, polluting plants across the
country. These new plants need to meet the standards set by the FCCC and the Kyoto Protocol. The
international treaties create an obligation for Government financing. The plants would then be leased,
including all upkeep, to power companies.16

Finally, the Government must help finance home and office alterations for removing these building
from the power grid.17

The Government should also create a system of rebates and tax incentives that outweigh the cost of
energy efficient and clean transportation systems.18 Because Americans are married to our cars, automobile
technology must be emphasized.

16. These leases should be long enough to encourage companies to lease, but short enough that financial and operating
problems do not become disasters before the lessee can be changed.

17. For example, where new subdivisions are built, the Government should finance the installation of DC generating
equipment and DC lighting and appliances on top of an emergency connection to the grid.

18. The greatest place for the Government in transportation is the building and then leasing of the infrastructure for
hydrogen fuel stations and the building and leasing of mass transit systems using clean technology.

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Appendix
Uses of Energy
Uses Portability Power Heat
Transportation
Automobiles High High NA
Trucks Medium Very High NA
Trains Medium Very High NA
Airplanes Very High Extremely High NA
Space Unbelievably High Unbelievably High NA
Buildings
Homes None Low None
Large Residential None Mostly Low / Medium None
Commercial
Offices None Mostly Low / Medium None
Stores None Medium None
Entertainment None Medium None
Manufacturing
Light None Medium Low
Heavy None Very High High
Table 1

Energy Sources
Sources Portability Power Heat
Liquid
Oil High High Extremely High
Gas High High Extremely High
Hydrogen High High Very High
Coal Low High Extremely High
Electricity Medium Low / Medium Low / Medium
Table 2

Transporting Energy
Sources Portability Transmission
Liquids
Oil High None
Gas High None
Hydrogen High None
Coal Low None
Electricity
Direct Current Low Low
Alternating Current None Extremely High
Table 3

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