Monday, May 26, 2008

Petrol, Diesel, Fuel…………Lets say Oil

It’s a substance that everyone seems to be addicted to. All the signs are there. We all need our fix at least once a week. We feel better when we have it and we get grumpy when it’s taken away from us. This is what is happening now, fuel prices are rising and people are getting cranky as their supply, their ‘fix’ is costing too much. There are calls at the moment, lead by the federal opposition, for a reduction in the fuel excise or getting rid of the GST on fuel (http://www.abc.net.au/news/stories/2008/05/26/2255420.htm).

I as much as anyone see and feel the pain that the high fuel prices bring. I earn a below average wage and I have a home loan. This makes me one of the least well off people around. Fuel prices don’t just cost you at the bowser they also lead into the increase in food and other basic necessities. Min and I (although I have to say Min more than me) also run a car.

Given all of the things above some might be surprised to hear me say that reducing the fuel excise or getting rid of the GST on fuel is the stupidest idea that I’ve heard in a while. I would say that the money could be better spent, but I would disagree with the fuel excise reduction.

Why would he say this you ask (even if you haven’t asked I’m going to tell you)? Well the government isn’t at fault for the higher prices. We probably in the middle of peak oil (http://en.wikipedia.org/wiki/Peak_oil) and we are now seeing the effects of an oil supply that cannot keep up with the hugely increasing demand. The developing world is now starting to use oil in a similar fashion to the most developed countries. I’m going to say it now even thought it’s in the news every day and it blamed for so many things. China, China China China. The oil demand of China is looking to be double that of the US by 2030 (http://www.salon.com/tech/htww/2008/05/22/wall_street_journal_peak_oil/). It’s a text book case of supply and demand (http://en.wikipedia.org/wiki/Supply_and_demand). If supply stays the same and demand increases, the price will go up. The Australian government has no control over the world oil market and no real way to influence the price of crude in Australia. The general trend will see a continuing increase in the price of fuel this is unavoidable. The government could decrease the fuel excise and the price will rise. So they decrease the fuel excise again, surprise surprise the price of fuel will rise again. By the end of next year the price of fuel would still be at $1.70 a litre even though the fuel excise would be 0.

A much better way of moving forward is to use the current fuel excise moneys to move Australia away from its dependence on Crude oil. We need to stage an intervention. Invest more in public transport. Move public transport away from petrol/Diesel to Gas and Electricity. Promote Biofuels such as Syngas from Agricultural byproducts (http://en.wikipedia.org/wiki/Syngas), Biodiesel from the Fisher Tropsch Process (http://en.wikipedia.org/wiki/Fischer-Tropsch_process) and Ethanol/Butanol from Cellulose digestion. None of these ideas could completely replace oil and none of them are really ready for the market yet. In a few years with some investment from the government these products could completely move Australia away from using Crude Oil. We could then develop these alternatives into large export markets. The World population has a huge appetite for Energy. That is all these products are.

There is another benefit of the products that I’ve suggested. The first is that none of them use food crops. All of them can use Products that are currently thrown away from current Agricultural processes. For Example the Straw from the Wheat plant is spat out the back of the harvester and left to rot on the ground or burnt. This straw could be bailed and fed into a Cellulose digester (http://www.iogen.ca/) to produce Ethanol or Butanol. Due to these products not using food crops and increasing deforestation. They will decrease the Greenhouse gas output of Australia. Especially Syngas production. Syngas is one of the few Carbon Negative energy production systems. It also produces Charcoal which is excellent as an additive to soils for increasing production and locking away carbon (http://www.abc.net.au/catalyst/stories/s2012892.htm).

I know its painful guys but there is nothing to do except use less fuel and try alternatives. I want to say this again PRICES WILL CONTINUE TO GO UP WHATEVER THE GOVERNMENT DOES. Stop complaining to the government about the high price of fuel as they can’t do anything anyway. Start demanding that they do some thing to help us stop using this addictive substance altogether.

The other thing that we could all do is, next time your grabbing your key to leave the house consider taking a pushbike instead.

2 comments:

Benoir said...

Hi, this was forwarded to me by Glen Anderson.

Interesting stuff, and absolutely correct. Good to know that there are thinking people out there. Unfortunately our voices are all too quiet against the volume of the ignorant rabble.

However, my argument is that it's not just as simple as saying 'everyone should start using biofuels'.

Unfortunately change will require massive lobbying efforts with a gross majority of Australians kicking and screaming for change. Not an easy thing to get happening given the average socially-numbed sheep-brained individual's capacity for independent thought - but possible in the longer term.

Also, you would be fighting massive corporate interests, tied up in collusion between oil companies and vehicle manufacturers. As if Ford and Texaco don't have any cross-shareholding interests to see to. It is a well known fact that both pure ethanol and pure water engine designs were bought and shelved many years ago by Ford, and why would that be pray tell?

So, what the Government can do is implement three very simple and rather drastic policies (which will undoubtedly make voters pee their pants and get the government sacked):

1. No more importing of cars that run on petrol. This would force manufacturers who want to sell to the Aussie market to rethink their design.
2. No more on-shore manufacturing of cars that run on petrol. This would mean that any cars exported to Asia etc, would need to run on the fuel that Australia makes in bulk (Ethanol from sugar cane and wheat crops - see point 4)
3. Offer a tax rebate on companies offering engine conversion to new fuels, thus making conversion of existing cars affordable to the average and low-earning consumer.
4. Begin an on-shore ethanol refining process (harvested from Queensland's vast sugar cane crops as a BY PRODUCT - i.e. no damage to the sugar industry, as well as from Australia's massive wheat production process using digesters)

And voila! Within 20 years, you will have a non-oil-dependent Australia, as well as an enormous export industry. And you can continue to use oil only for industrial purposes if necessary.

Will this happen? Of course not.

Why? Because people are too stupid to think beyond the next week let alone a decade or two. More importantly, because our previous governments are locked into trade agreements with the US that are purely in the interests of the American Corporate Elite, who have the CIA on their payroll, and would ensure that if a large market were to look like suddenly disappearing, those responsible would be removed from power one way or another.

It is beyond all doubt that the whole 'war on terror' bullshit and even Sept 11th was purely an orchestrated excuse to de-legitimize the Middle east, destabilize it, put in puppet governments and then simply take their oil before China does. It's economic tactics masquerading as an ideology of libertarianism. It's really that simple. But in the end, it is the unquestioning, oil hungry consumer who is responsible for every inhumane violent act done in the name of greed for oil. Remove the demand, and you remove the problem.

I drive a car (albeit a small one) and I feel guilty every time I pull the bowser trigger. I feel sickened by the sheer idiocy of those who drive petrol guzzling SUV tanks around city streets, and the only consolation I have is that their wallets suffer for it.

If there was actually an affordable alternative, Australians would be all over it like stink on a monkey, and we could potentially lead the world.

But I'm a pessimist. Humans are too short sighted, and Australians are amongst the worst.

That said - I'm all for raising awareness, and trying to get the stone rolling so that moss is gathered...

- Ben

Unknown said...

Hey Benoir,

Nice to see someone reading and interacting with the blog finally. Glen sometimes leaves comments but not very often. I love getting ideas like these it give me a chance to try and think along different lines to the ones I normally pursue.

I don't feel my post postulated a simple answer of 'everyone should start using biofuels'. I was posing a strategy that played to Australia's strengths and hopefully minimised the coming pain that high fuel prices will bring. We just will not get everyone in Australia to stop using Petrol and other crude oil products until alternatives are offered. I also don’t think that Biofuels are the be all and end all. They are only one part of a large solution that will end up changing in the way Australians live. But things need to be done step by step and solutions need to be worked out that help rural and urban areas at the same time.

A little While ago in Townsville there was a company called Reefuel, they made Biodiesel from fry oil from local shops. There product could be offered at a price of $1.36 a litre. This was excellent except that they went broke due to fuel prices dropping below this point. They could start production again but they will need time (and confidence) to get up and start again. Diesel price in Townsville is currently at $1.70. This small producer almost made it into the market with global energy giants. If they were to re-enter the market I think they would do well and need a large supply of vegetable oil, more than the local restaurants could provide.

This is why I believe that there is such a large part for the government to play. They need to help in the set up of industrial size production facilities for alternative fuels. These types of fuels should also get fuel excise breaks. If alternative fuels could be offered that were cheaper, less polluting, and worked in current vehicles, then people would be buying the supplies dry. Also the government should encourage the production of alternative fuels by farming co-operatives this is where there is opportunity to increase efficiency. Farmers currently earn money by food production. They also need to start using the by-products of food production to product fuel. My dad has been a grape farmer. He could earn money from the grape then a few months later sell the prunings from the vines to a local production facility to produce Syngas. This doubles income from the one crop and will help farmers make it through the tough times.

Then after production and supply were sorted the government could mandate that to import cars into the country the manufacturers must supply at least one model of Hybrid and one Flex fuel model. This wouldn’t be a problem for most manufacturers. GM and Ford would struggle as the US car manufacturers have not kept pace with the rest of the world in terms of efficiency and fuel line Technology. By the way flex fuel cars burn pure ethanol or petrol or a mixture. This technology has not been shelved it just has not been introduced in countries like Australia and the US due to lack of incentives/demands on the manufacturers. Flex fuel cars are the dominant type of vehicle in places like Brazil where the government mandated there introduction.

There is no such thing as a car that runs on water. You cannot burn water and you cannot oxidise it to produce energy. You can run a car on Hydrogen such as BMW’s Hydrogen burning Car (I think it’s the 7 series). The exhaust gas from burning Hydrogen is water. Combine 2 Hydrogen atoms and 1 Oxygen atom and you get 1 molecule of water. There are two main ways that the energy from converting Hydrogen and Oxygen to water is used. One is through a fuel cell which uses this reaction to create electricity and the other is to use it in a internal combustion engine. The second option is almost like burning LPG in a car. You just need different internal bits in the car to stop corrosion by high temperature water.

I believe that stopping the importing of all petrol burning cars would incur a huge hardship to the Australian people. Not only this, but this strategy would hurt the rural and poor areas of the country more than the urban and rich area. The price of cars would soar. The people who are least able to afford cars are be the ones that would need them the most, poorer people in outer suburbs of major cities and rural families. These places have little or no public transport and forced into driving to get to work. Rural Areas would be the last to get the Ethanol at the pump and would be the first to need it. We do have to have a social conscience when considering plans for the future.

Having spent the last paragraph bagging benoir’s ideas I now want to say that these are excellent ideas and help me adjust my ideas on this subject. In paragraph 5 above I said that we (Australia) could mandate the introduction of Flex fuel cars and Hybrid Cars along with the rest of the manufacturer’s line. This is just a moderation and an adaptation of the ideas posted above by Benoir.

These have been so interesting that I think they will be developed into a series of posts.

Cheers L.