Thursday, August 30, 2007

Brazil makes oil too?

Lately, Brazil's energy-efficient and economical sugar cane ethanol industry has been receiving lots of attention in energy circles. But, Brazil has a fairly large and thriving petrochemical industry as well. Today's Wall Street Journal profiles the unusual success that Petrobras, Brazil's nationally owned oil company, has had in the last ten years. Highlights from the article:

"If only our friends in OPEC were more like Petrobras we'd all be a lot happier because there would be a lot more oil," says Leo Drollas, chief economist of the London-based Center for Global Energy Studies....

...[Ten years ago the Brazilian government] also abolished Petrobras's monopoly on drilling for oil in Brazilian territory....

...Unlike most state companies, which were either born with reserves or nationalized them, "our objective was to find reserves," says Mr. Gabrielli, the Petrobras president....
MIT users can get the article FREE via Factiva by starting from this link.

Tuesday, August 28, 2007

From alphabet soup to focused energy hot pot

Over at xconomy, Wade Roush reports two interesting developments in Massachusetts' energy entrepreneurship space. First, the New England Energy Innovation Collaborative (past sponsor of the MIT Energy Conference!) may be merging with Governor Patrick's soon-to-be-publicized Massachusetts Clean Energy Council.

Second, and perhaps of more local interest, the NEEIC Business Creation Competition may merge with the Ignite Clean Energy Business Plan Competition.

I think both of these are (potential) positive developments, but as MIT Energy Club Entrepreneurship Chair, I am personally more interested in the potential merger of the business plan competitions.

If the merger between the business plan competitions does happen, it will be interesting to see the parameters of new event. Last year, I know from experience that the ICE competition put a lot of emphasis on polishing the business plan documents and powerpoint decks to make as persuasive a case as could be made for a given team and technology. Teams with polished pitches did well. The NEEIC competition, in contrast, seemed to judge entrants more on a holistic, "do I buy it or not" VC mentality which evaluated a technology's perceived chances in today's energy venture marketplace.

As the xconomy piece notes, differences in the prize structure would also need to be rectified in the event of a merger. The difference in judging criteria is likely related to the prize structure. NEEIC's use of a convertible note as a prize means that VCs wind up invested in the winning team. Naturally, a holistic, yet all-or-nothing VC mentality results in the judging process. This isn't a bad thing, of course, but is in contrast to the ICE competition. There, the motto is "learn, network, win", which to me suggests that one of the primary goals is simply educating the participants about the world of energy entrepreneurship here in Massachusetts.

One thing that I hope won't change is the success that MIT Energy Club members and MIT students in general have in these competitions! Just to name a few, Peter Bermel, who co-founded StarSolar and won the NEEIC competition, has lent his voice to past EC discussion groups. Dave Pelley, a member of the ICE-winning RSI Silicon team, is an MIT alum Energy Club member. Who from the MIT Energy Club will dominate the business plan competitions this year?

Coal on the brain

Lately I've been thinking a lot about coal. Coal mining is a dirty, dangerous job, as we are all occasionally reminded when tragedy strikes, as it did in Utah and China in the past weeks.

But these reports focus on the calamities and disasters, which are undoubtedly the most horrific risks that miners face. But I've always known that even the average, disaster-free workday is no walk in the park. Recently, I had the chance to visit the coal mine exhibit at Chicago's Museum of Science and Industry, an absolutely fantastic firsthand look into the day-to-day drudgery of life in the mines.

After seeing the exhibit, I viewed the Bush Administration's recent removal of regulatory obstacles to mountaintop mining in a different light. Mountaintop mining, where instead of digging underground tunnels into a mountain, the mountain is just exploded from the top down, may exact substantial environmental costs, for sure. But it seems to me that this practice offers miners a decreased risk of disaster and an improved general workplace welfare. that the risk of disaster as well as the health and welfare burdens that miners bear are much lower with mountaintop mining.

How do policy experts balance workplace safety with environmental concerns when deciding on how to regulate the coal mining industry? It's a tough job and I would love to hear from policy experts.

[Hat tip: Jonathan Adler for the link to the NYT article.]

Wednesday, August 22, 2007

Isotopic fractionation

This is the second of my posts on Thomas Gold’s book Deep Hot Biosphere, in which Gold espouses the radical idea that global petroleum and gas reserves are formed from geochemical reactions deep in the Earth’s crust. In contrast, the vast majority of experts think he's wrong. Fascinated by this book and the controversy around it, I decided to look into the scientific data on petroleum’s origins and arrive at my own conclusions. Like I said before, I’m not a geologist; I just did the best I could with the limited time I had.

One of the strongest pieces of evidence in favor of the biogenic theory is the study of stable isotope fractionation. All elements have isotopes. Hydrogen vs. deuterium, carbon-12 vs. carbon-13, oxygen-16 vs. oxygen-17 or oxygen-18, and so on. The only difference between an atom of carbon-12 and an atom of carbon-13 is that carbon-13 is about 8% heavier. Since carbon-13 is more-or-less chemically identical to carbon-12, we find it in all the same places that we find the usual carbon isotope. It’s in atmospheric carbon dioxide, in the carbon in coal, oil, natural gas, and in our the carbon that comprises our bodies. Carbon-13 atoms hang around all over the place and do the exact same things as carbon-12 atoms do...

Except. Being just a tad heavier that its more populous cousin makes carbon-13 undergo some chemical reactions and processes at very slightly different rates. For example, its heavier, so carbon-13 dioxide evaporates from sea water into the atmosphere at slightly slower rate than its more common cousin carbon-12 dioxide. So, the ratio of carbon-13 to carbon-12 in atmospheric carbon dioxide is ever so slightly lower than in pools of carbon.

Over the decades, geologists have gotten good at tracing the minute differences in the carbon-13 to carbon-12 ratio, and similar rations for other isotopes. One thing they found, that proponents of both theories seem to agree on, is that oil and gas have are depleted in carbon-13.

The biogenic camp (e.g., these guys) explains the depletion of carbon-13 through the chemical reactions of photosynthesis: the atmospheric carbon dioxide has to diffuse through leaves. In oceans, it has to dissolve in water before aquatic plants can fix it. These processes favors lighter carbon. It has to react chemically with other metabolites in the plants biochemistry. These reactions, too, happen faster to lighter carbons. So the organics sediments that eventually formed oil are depleted in light carbon. Viola. Oil and natural gas will naturally be depleted in heavy carbon, carbon-13, as a result.

Gold’s theory holds that oil and gas come from methane trapped in the planet since its formation and slowly diffusing outward from the Earth’s mantle. But, on its way out, it gets trapped in the very tiny pores of a variety of rocks. It has to diffuse through. Diffusion is faster for light carbon. Eventually, in the deep crust, chemical reactions transform the methane (now depleted in heavy carbon) to oil and gas. Viola.

But, both camps can’t be right. Luckily, it seems recently geologists have gotten more sophisticated with their isotopic analyses. They’ve been analyzing the isotopic fractionation of not only the carbon in oil and gas, but also the hydrogen. And they’ve been correlating these results.

Also, geologists have turned to helium-3 for answers. Helium-4, the more common isotope of helium, is formed from the decay of various radioactive minerals in the crust. Helium-3, in contrast, is formed only in stars. The helium-3 on Earth, then , is left over from when the planet formed from stardust four billion years ago. It’s still leaking slowly out of the mantle. So if sample of natural gas has a ratio of helium-3 to helium-4 that is relatively high, it’s a sign that at least some of the gas may have originated in the mantle.

With these new techniques, scientists have found abiogenic hydrocarbons in the Earth’s crust! But, the isotopic signature of this abiogenic gases differed strongly from what the Gold’s abiogenic theory would have predicted, and way different than the observed signature for commercially exploited gas reserves. The upshot: abiogenic hydrocarbons apparently account for only a minute portion of the subterranean hydrocarbons on Earth. Gold's theory, at least as he spelled it out in his book, doesn't seem to overcome the more recent isotopic measurements.

Wednesday, August 15, 2007

MIT alum and Energy Club member David Berry wins Technology Review's TR35 Innovator of the Year!

Congrats to MIT energy alum and active Energy Club member David Berry, currently a principal at Flagship Ventures, for being named Technology Review Magazine's "TR35 Innovator of the Year" in large part for his innovative scientific and entrepreneurial work in founding LS9, a Flagship-founded company using synthetic biology to coax organisms into making petroleum-like fuels.

Way to go David!

Tuesday, August 14, 2007

No such thing as fossil fuels?

About eight years too late, I finally got around to reading Deep Hot Biosphere by the late Thomas Gold. This controversial book expounded Gold's theories that petroleum and natural gas are not formed from biological sources. Instead, he argued that petroleum, natural gas, and even (non-anthracite) coals were formed from geologic, not biologic, processes.

The title of the book comes from Gold's attempt to explain the presence of molecular "fingerprints" of once-living organisms in petroluem, for example, the carbon skeletons of cholesterols and other lipids have been found in oil. The traditional theory says these molecular traces are simply evidence of the once-living organic matter from which petroleum was eventually formed. Gold, however, rectified his abiogenic theory with these molecular tracers by positing the widespread existence and activity of microorganisms deep in the earth, in the pores of metamorphic and igneous rocks. Why stop there? He then went on to argue that the deep hot biosphere is a more likely spot for the origin of life than the primordial pool we're always hearing about.

Sound pretty far fetched? It did to me too. But, I'm an industrial microbiologist by training, so I was intrigued by the possibility of deep subterranean bacteria. Plus, the energy implications of Gold's theory are huge. If oil's not formed from fossils, it's not a fossil fuel! So I thought it was worth checking out.

I didn't take Gold's word at face value. First I went hunting for criticims of Gold's views out there in the blogosphere. Perhaps unsurprisingly, I found a lot of noise and vitriol but not too much cool-headed explications of modern geological understanding. Wikipedia, as usual, was marginally useful for background, it was too hard to get a reliable survey of modern geochemistry from Wikipedia alone. So in the end I relied on an introductory textbook in organic geochemistry as a Moriarty to Gold's Holmes.

In the next couple of posts, I want to discuss what, to my non-geologist layman eyes, look like key points of evidence for and against Gold's theory. Hopefully the knowledgeable will drop by to correct me if I mess up the planet science too bad. First up, I'll deal with the most arcane, difficult to explain data: stable isotope fractionation. Stay tuned!

Monday, August 13, 2007

MIT Energy Clubber Bilal Zuberi argues for "A Drive Toward Fuel Economy" in the Boston Globe

MIT alumnus and Energy Club member, Bilal Zuberi, VP at GeO2 Technologies in Woburn, MA - a start-up that is developing advanced diesel aftertreatment technology - had a great op-ed piece published in the Boston Globe today. Enjoy!

"A Drive Toward Fuel Economy"
by Bilal Zuberi, VP at GeO2 Technologies in Woburn, MA

"IN THE LAST two decades, the automotive industry has been ablaze with innovation -- from cars that park themselves to cars that "clean up" after themselves. Literally, the automobile has grown smarter as technology has enabled manufacturers to rethink their old ways. Unfortunately, the foresight ends there.

This past week, two bills designed to increase fuel economy standards in the United States were introduced in the House of Representatives and promptly shot down. With them, the hope that industry standards would finally catchup with innovations in the field diminished as well. Indeed, Congress has dragged its feet for far too long in forcing automakers to improve fueleconomy.

Unfortunately, this latest retreat in Congress is not the first time proposed changes -- changes so minor they were not nearly enough to begin with -- have hinted at improvement, only to fade rapidly. In his State of the Union speech in January, President Bush suggested a 4 percent annual increase in the fuel efficiency of cars and light trucks by 2017. His words did little to catalyze any concrete change. Later, a proposal to increase fuel economy standards by 4 percent annually from 2020 to 2031 died an early death in the House. In short, the United States is no better off today than it was 20 years ago as far as fuel efficiency is concerned.

Compare the United States to similar economies: European fleets already average 43 miles per gallon and Japanese fleets are reaching 50 miles per gallon. While there are only two car models in the United States that achieve greater than 40 miles per gallon (both hybrid vehicles), there are more than 113 such vehicles in Europe.

The most astounding fact is that many of the European high fuel-economy vehicles are produced by US car makers. How can the government let manufacturers continue to convince the nation that a fuel economy of over 35 miles per gallon is difficult to achieve? Any rational person should not be willing to accept these manufacturers' excuses.

If existing technology for vehicles with higher fuel economy has succeeded in Europe and parts of Asia in terms of both safety and commercial profit, why not implement policies to make similar vehicles more accessible in theUnited States? The success of Toyota Prius and other gasoline hybrids across the United States shows that there is verifiable national demand for more fuel-efficient cars.

Equally important is the fact that hybrid technology is not the only way to reach higher fuel economy; nearly 50 percent of the cars sold in Europe are clean diesel. Clean diesel autos not only provide a much higher fuel economy than gasoline models, but also run faster and more efficiently and last longer. Members of Congress should try renting one the next time they travel abroad.

A closer look at the diesel industry shows that innovations such as the nationwide availability of low-sulfur diesel and the commercial success of diesel particulate filters (the filters remove more than 99 percent of pollutants from diesel exhaust) have made clean diesels cleaner than other vehicles on the road. They also provide a hefty bonus of nearly 20-30 percent better fuel efficiency than gasoline engines and low CO2 emissions.

Clearly, the barrier to improving US fuel economy is not technological; the real obstacle is lack of political will. Automakers are demonstrating a remarkable ability to resist any changes in mileage standards, and instead they are producing larger and heavier cars with unnecessary amenities, such as chilled glove boxes. A better way to improve fuel economy would be for the government to let market forces do the work, which is what Europe has done so successfully over the past few decades.

Like Europe, the United States should price fuel at its actual cost. It is estimated that the US government subsidizes fuel at a cost of roughly $3-$10 per gallon, if one considers all the tax breaks accorded to the oil companies as well as the costs associated with regulatory oversight, pollution cleanup, and liability. The real price of gasoline in the United States, without the subsidies, would not differ much from the $6 per gallon that it is in Europe. What would you drive if you had to pay more than $100 the next time you filled up your tank? I know I would look for better performance with higher fuel economy."

Sunday, August 12, 2007

What ails cleantech investing?

It's no big secret these days that venture capitalists, in general, have gotten euphoric about energy. Money is flowing into the space. Opportunities are huge. Energy, we are constantly reminded, is a trillion dollar industry.

With stakes that high, it's more important than ever to make good bets. What makes new ventures succeed? What can investors be doing differently?

This Wednesday, the Energy Club has a great lecture/discussion session lined up on this exact topic, featuring seasoned entrepreneur and clean tech investor Dave Miller.

The focus of our discussion will be on clean tech investing, but over at Xconomy, Bill Aulet has suggested that part of the problem for investing may be too narrow a focus. He wants to see more money going after hydrocarbons and efficiency.

Given the long cycle times for new clean technologies to come online, focusing on the familiar may make investment sense. But the questions I'll be bringing to the table on Wednesday are, Is it good policy to encourage such shifts? And, how else can can we speed up the introduction of new energy technologies?