T6. More on early coal mining

In the last Tech Note I wrote about harvesting coal along the coast, and then the shallow workings that became the first underground mining, where tunnels were driven into the sides of the hills, within the coal seam. The miners would load the coal into baskets, or corves. These corves were woven by people in the village, it was one of the early jobs that George Stephenson (he of railway fame) had at the mine. And they were small enough that they could be carried by women. (The quote at the bottom of the post says that they carried 56 lb of coal). As greater production was needed, so the corves grew larger, and were placed on sleds that women and children could drag through the mine to either the outside, or, as the seam went deeper, to shafts. At the shaft the coal baskets would be raised to the surface using windlasses, which were turned either by people, or as more power was needed by horses or oxen. You can see a corve being lowered using a horse gin in this picture .

As the workings moved away from the shaft, a layout had to be created in which pillars of coal would be left to hold the roof up. At the same time there were two gases that became feared by the miners. At the time they were using candles that were attached to spikes that could be driven into the coal wall, or a wooden prop being used to hold the roof up. One of the gases that would desorb from the coal is methane. This is the natural gas that is now, in some locations collected by drilling long horizontal holes through the coal. It is an unconventional source of gas, and usually called Coal Bed Methane (CBM). While it will come out of a pipeline at a useable concentration, when it seems out of the coal within the mine it can become diffused through the air, and in a modern mine the air speed and volume are designed to dilute it, and carry it rapidly out of the mine. In earlier years, however, they did not have such fans. The air was almost still, and so the methane could rise and collect in pockets at the roof. Holding up a candle to see ahead a miner could ignite the gas, or if it was in a concentration of 5-15% by volume it could explode. When it explodes it can kill either through the force of the blast, or by burning up all the oxygen in the mine, suffocating those not initially killed.

At the start of a miner’s day they might therefore send someone in, wrapped in wet cloth, and crawling along the floor with a candle on a stick. At each high point in the roof he would raise the candle, hoping in this way to burn out the gas, before it reached the explosive level, and while the pockets of gas were small. The person doing this was given the title “The Penitent. ” The role was also present in salt mines faced with the same problem, and there is a photo of a Polish model, the old classic picture is a bit harder to find so I must dig out and add a version of my copy.

Keeping the air churned so that these pockets of what was called Fire Damp, or just plain damp, had to be done several times a shift, generally by waving an article of clothing, in the days before mine ventilation.

The other gas that had to be watched for was carbon dioxide, which in contrast with methane, which being lighter than air collects in the roof, is heavier and thus pools on the floor. So that if you were getting down to cut the starting slot in the bottom of the coal seam, you might just drop into a pool. It was called choke damp – though that was also the name given to carbon monoxide, which could also seep out of the coal. All these gases are colorless and odorless so that without some form of detection (the canary for example, or using a candle as a test) they can lurk to catch the unsuspecting. With the invention of the safety lamp (where the heat of the flame is removed by a surrounding mesh of copper wire) it became possible to use the lamp itself as a testing tool. One of my first mining tests was to make sure that I could tell, by the height and shape of the small blue flame of the methane burning over the lowered flame in the lamp, what the gas concentration was. (Each lamp was in a separate hood, and I remember that they had two at the same concentration in the set of around half-a-dozen I had to evaluate).

As the mines grew larger air had to be circulated through them, so that these gases would not build up, and a series of temporary and permanent walls would be built between pillars in worked out areas of the mine, to make sure that the air moved around the mine, and then back out the shaft. For many years, starting in around 1810 the motive power for the air was created by having a fire in the bottom of the shaft, in a special furnace room. Usually these were underground, although there was the occasional one at the surface. Unfortunately if the fire ignited the surrounding timber that was being used for support, then a major fire could result, killing everyone underground. This was the case with the Avondale mine disaster in 1869, at the time the worst industrial accident in American history, 110 people died.

Although there are still parts of the world where this type of primitive mining still occurs, and where women and children are used to help get the coal out, in most countries they have been banned from underground work. (This was the Act of 1842 in the United Kingdom) . Taking the coal from the miner or hewer to the shaft was known as putting or hurrying. (I learned it as putting).

Six year old girl:
"I have been down six weeks and make 10 to 14 rakes a day; I carry a full 56 lbs. of coal in a wooden bucket. I work with sister Jesse and mother. It is dark the time we go."

Jane Peacock Watson.
"I have wrought in the bowels of the earth 33 years. I have been married 23 years and had nine children, six are alive and three died of typhus a few years since. Have had two dead born. Horse-work ruins the women; it crushes their haunches, bends their ankles and makes them old women at 40. "

Maria Gooder
"I hurry for a man with my sister Anne who is going 18. He is good to us. I don't like being in the pit. I am tired and afraid. I go at 4:30 after having porridge for breakfast. I start hurrying at 5. We have dinner at noon. We have dry bread and nothing else. There is water in the pit but we don't sup it. "

So I will leave this segment just as the mine transitions from families working where the man hews coal from the face, loads the baskets, which are then dragged to the shaft by his wife and children and winched to the surface. Next time I will talk about the coming of the pit pony and mechanization and the changes that made. It increased the energy cost of mining the coal almost from the beginning, but that’s next time.

Earlier posts on coal mining are:

T1. Coal – its formation and structure

T3. Coal Reserves – or what can I count as real?

T5. Historic Coal Mining.

As I get time (and practice) I will also come back and illustrate these words with some pictures using Poser.

Saturday Pick Points

Normally this is the point every week where I wander around the Climate Change sites, just to see what is stirring them up. And the controversy continues over the statistics of the paper by Steig that I first mentioned back in January. There is a very well done dismemberment of the underlying statistics given at Watt’s Up With That this week. Basically part of the criticsm is based on the relatively obvious point that as you move two weather stations further apart, then the likelihood of them both having the same weather at the same time becomes less, particularly at greater distances. (For example the snow storm that will hit the East Coast Sunday night and Monday hit Missouri Saturday and was somewhat milder – we got 2 inches, Maine will get 12 inches. On the other hand Waynesville and Salem in Missouri both reportedly got the same amount). However when you look at the statistics that were used in the paper the likelihood of the weather being the same stays the same regardless of their distance apart. And it even stays the same when you consider satellite data. Which sadly implies that the results as quoted in Nature and given national prominence are in error and in fact where a more realistic model is used the continent returns to a largely cooling phase and the furor the paper raised is shown to be based on a false premise. (Not of course that this finding will get much mention in the MSM). Though the controversy may well continue, since the new story is that the speed of the glaciers is accelerating. There is very little data from down in the Antarctic and so it will be interesting if this particular study gets picked up.*
*Since this deals with a topic that I actually teach to students, I will have a small technical note at the end.


Speaking of furors the little tempest over the article that George Will wrote on Climate Change in the Washington Post two weeks ago continues to churn. I talked a little about temperature fluctuations last week, explaining the trends as to why it might have seemed that the world was cooling in 1975. The other major issue was:

As global levels of sea ice declined last year, many experts said this was evidence of man-made global warming. Since September, however, the increase in sea ice has been the fastest change, either up or down, since 1979, when satellite record-keeping began. According to the University of Illinois' Arctic Climate Research Center, global sea ice levels now equal those of 1979.

It is important to note (though it is rarely mentioned in the row) that satellite records have only been available since 1979, and that is why that particular date was chosen.

Well there were the usual diatribes, with ad hominem attributes – “Is George Will the Most Ignorant National Columnist” is a good example, and the controversy ran for a week, so that George Will’s column a week later also dealt with the subject. It pointed out that, within a reasonable scale of accuracy, what he had said was correct. Which, of course, led to a second set of diatribes . After another week of comments the Post Ombudman wrote a column this weekend. Basically it said that the facts that George Will used were accurate, but that since there had been a big change in the relative volumes of ice (the Arctic had lost a lot which growth of ice in the Antarctic had almost offset) this should have been brought out in the article. And just to emphasize this, Real Climate, in writing "the article that Will should have written", notes

The source of the original quote was a Daily Tech blog post published in early January. While that post itself was heavily criticized as being misleading, it did use data from a reliable scientific source which was technically accurate at the time. My error was in assuming that scientific 'facts' don't change over a month or two and thus it was not necessary to revisit the source of the original data before writing my column. What was true in January would still be true in February, right? Wrong.

Of course that does not mention that the sensor doing the measurement went wonky. Now it turns out that the folks gathering the data have given a very rational explanation at WUWT about all this, and why they are now catching on to to demands of the internet, but still.

Well that has not quieted the complaints, though it is interesting to note from the ombudsman’s column

Although I didn't render a judgment, my response was understandably seen as an institutional defense and prompted an orchestrated e-mail campaign in which thousands demanded that The Post correct Will's "falsehoods." Like they say when the pro football rookie gets clobbered: "Welcome to the NFL."

The messages, often identical in wording, were soon countered by waves of e-mails defending Will and attacking what many labeled "global warming alarmists" trying to muzzle him.

It is the “often identical in wording” which shows the footprints of the thought police. Sadly it is almost impossible to have a reasoned debate on this issue, since any attempt to bring up the topic either gets this treatment (as I noted earlier) or is ignored, as the testimony by Professer Happer before the Senate Environment and Public Works Committee Senator Barbara Boxer, Chair has largely been.

Similarly John Tierney wrote about Climate Change in the New York Times noting that scientists are tending more to Apocalyptic statements, and urging instead that they behave as honest brokers. Since the scientists who get quoted most often are those who are promising that the conditions are getting worse rather than better and this does help to sell newspapers and air time, he has a point. Needless to say he is not popular with those that advocate AGW. showing their desire to keep the debate at a sophisticated level they have opening statements such as

Tierney is easily the worst science writer at any major media outlet in the country. Pretty much every energy or climate piece he writes is riddled with errors and far-right ideology, including this one.

. And then you get the latest, after Tierney’s recent column

The backlash from George Will's disinformation rightly grows each day that the Washington Post stands behind his lies (see here). Media Matters has samples of widespread outrage in the country here, and a new report [PDF] from CAPAF challenges the WP to issue a correction.

Now it is time for outrage over John Tierney, who not only makes stuff up just like Will, but is actually on the New York Times staff as their 'science' columnist. When we last saw Tierney, he was spreading lies and disinformation about science adviser nominee John Holdren (see here).

Today, the NYT not only let him print more egregiously made up stuff to smear Holdren (and Energy Secretary Steven Chu). But they actually published an article "Politics in the Guise of Pure Science" (see here) under the heading "FINDINGS" about Chu, Holdren, climate science, and climate solutions with precisely one source -- Roger Pielke, Jr. That would be like publishing an article critical of Obama's handling of the financial crisis and only citing Bernie Madoff.

Sigh! At the risk of being repetitive, the Senate Committee took testimony this past week, from Chris Field (pdf) and (among others) Professor Happer as cited. They hold strongly different views, yet are the two positions debated in the press, or in Congress as they should be, or are we still being subjected to the “ad hominem “ types of attack that seems to be the fall-back position of what, sadly I am beginning to truly think are those setting out to be thought police for this nation. The Bernie Madoff case illustrates the need for open debate and making this whole debate more open, and more based on science. What Joseph Romm and his ilk seem bent on doing is to have us instead behave as Bernie Madoff sycophants and not ask questions.

The abuse that I have seen showered on articles that raise technical and scientific questions is clearly an attempt to shout them down. It has been my experience and that of others. With the numbers of identically worded letters going to the WP Ombudsman it is clear that these are orchestrated campaigns.

To end with a slight technical comment, that I will expand into a Tech Note one of these days. For my sins I am one of the few people I believe that has videotaped a landslide from in front and beneath it, and got away with it. I have used that video in a class I teach on the movement of geotechnical material and the forces that drive that movement. As part of the class the first homework assignment begins "Take a can of your favorite beverage, drink it. Now fill it full of water and place it on a flat surface. Slowly tilt the surface and note the angle at which the can slides. Now poke a small hole in the bottom of the can and repeat." The class has been doing this and reporting the results for decades, they vary quite considerably, depending on the nature of the surface, its roughness and a number of other factors (and in the course of those decades the favorite beverage has undergone a number of changes). The assignment is not original, but it has shown that there are a number of factors that govern block movement - about which more anon.

Carbon Dioxide - A Satellite Crash raises a Question

Last week one of the rockets carrying a satellite into orbit failed to shed its fairing (the clamshell nose cone that protects the rocket and helps it move up through the atmosphere more easily) and with that extra weight could not make orbit. The rocket was carrying the Orbiting Carbon Observatory and had five major tasks including:

> - Scientists don't know why the amount of carbon dioxide absorbed by Earth's natural ocean and land "sinks" varies dramatically from year to year. These sinks help limit global warming. The Orbiting Carbon Observatory will help scientists better understand what causes this variability and whether natural absorption will continue, stop or even reverse. 

-- Data collected by OCO will help solve the mystery of "missing" carbon--the 30 percent of human-produced carbon dioxide that disappears into unknown places.

Now it seems to me that if you don’t know where carbon is going and why, nor why it is varying dramatically each year, then you can’t predict how much there is going to be in the atmosphere, or necessarily be accurate in stating that CO2 resides in the atmosphere for a hundred years, since short of putting a tracer on a molecule and following it to see what happens there are too many unknowns.

The idea that carbon dioxide stays in the atmosphere for up to a century is apparently due to a study by the National Academy of Science, chaired by Roger Revelle, who reported this in 1977. Former Vice President Gore took Professor Revelle’s class while at Harvard. The estimate as to the length of time came initially from the ability of seawater to absorb carbon dioxide from the air, (Craig in 1975 and Plass in 1956). Revelle headed the Scripps Institution of Oceanography in California, and studied the process, opining in 1957 that CO2 resided in the atmosphere for about a decade, with the control being the ability of the sea to take it up. This ability was apparently more limited than had been anticipated, since the underwater layers did not intermingle as much as had been anticipated in earlier studies.

However the short-term life of the CO2 molecule in the atmosphere was predicated on the assumption that once it was absorbed into the sea it stayed there. Revelle included the idea that most of the CO2 that would be adsorbed would promptly evaporate back out, so that the realistic life of the molecule in the atmosphere might be ten times longer (i.e. a hundred years).

Now the study is complicated in the sense that it is indirect. For example when a group of British scientists stated in 2007 that the oceans were absorbing less CO2 than expected, this was based on measurements of the seawater. Similarly a study in Hawaii that reported that increasing salinity had reduced the ability of the ocean to adsorb CO2 looked at the concentration in the water. Incidentally that study also noted

From 1989 to 2001, the ocean-surface salinity at station ALOHA went up about 1 percent. That's because in recent years there's been less rainfall and more evaporation in the area, both of which concentrate salt in the surface water. When the concentration of dissolved substances goes up, it becomes more difficult for a liquid to absorb a gas, says Karl.

Increased salinity accounts for about 40 percent of the decrease in carbon dioxide absorption over the 13-year period, says Karl. He and his colleagues haven't identified the cause of the rest of the absorption slowdown, but some candidates are changes in biological productivity and fluctuations in ocean-surface mixing.

The problem of determining exactly how much carbon dioxide will be absorbed is not easy

What scientists generally use are not "rates" but "concentrations" at equilibrium. This turns a horrifically uncontrolled irreproducible problem into just an extremely complex problem. But that is a step in the right direction. In practice measurements are usually equilibrium quantities.

And

To reemphasize: "Rates of solution" are virtually useless as a scientific tool in the study of the distribution of carbon dioxide in the biosphere because it only applies to the specific place, time and conditions that the concentration is measured. It would only be useful for some very localized study or problem. Because of the number of rogue variables "rates" will likely vary "all over the map" unless there is some "driving force"

Now I am not looking at this with a detailed scientific eye, for now I will leave that to others. My current point is just that if we don’t know where significant amounts of carbon dioxide are going, and yet significantly more is disappearing from the atmosphere than the current models suggest, then this is an indication that the models are not correct. And if the models are not correct, and more is disappearing then the underlying assumption that the concentrations of carbon dioxide in the atmosphere in the future are wrong. And if the concentrations are wrong, then the forcings that they are purported to induce will similarly be wrong.

What I actually wanted to end up with in this particular post, before I wandered down this little alley, was all the different sources of CO2 that there were and their volumes produced. I never quite got that far, but for the sake of reference (which is part of what this post was meant to be about) the EPA has produced a fairly comprehensive document on the Greenhouse Gas Inventory from which I took this figure for the fossil fuel industry. And I will close with this for today.

Source EPA

The OCS, Chevron and an API Conference

Every so often the American Petroleum Institute (API) hosts a conference call for interested bloggers to talk to folk in the industry. Today they had Gary Luquette who has been President of Chevron North America Exploration and Production Company since 2006. He was in Washington to testify before the House Committee on Natural Resources, and copies of his opening statement were available. This was my first visit to one of these events, and I am grateful to Jane Van Ryan for the invitation. The transcript won’t be out until next week, and I did not catch the names of other participants that well, so I will put that information up when I get it. The questions were focused largely on the testimony, which dealt with access to the outer continental shelf (OCS) of the United States, to allow drilling and production of oil and gas. (API has also just released a primer on the topic.) It is a region where access is currently not available, and so in a sense this was perhaps a move towards the “drill, baby, drill” rhetoric of the last election. The current areas that are off limits are shown on this map that I borrowed from the API primer.

Source API
UPDATE I will add links to the posts of the others that were in the call as I get them, and at the bottom of the post.

Some of the most productive recent discoveries have occurred in the deep waters of the OCS in the Gulf of Mexico, (for example Thunder Horse at 250,000 bd, and the Chevron Tahiti project. The region falls under the Minerals Management Service of Interior, and they recently published their 2008 review of the region. Currently their purview includes the gridded bit of the map below, and the report contains detailed information on wells and production in that region. For example the following figure shows how, over time, companies have had to go to deeper and deeper waters to find new reserves, but that in doing so that they are finding larger fields.
Source MMS
Average field size in the GOM showing discovery date and depth of water (Source MMS ).

It is this trend in discoveries that were an underlying part of the message that Chevron (and the other companies) were trying to convey. As Gary pointed out in his response to a question from “The Bear”, the assumption in the 1960’s, based on MMS surveys, was that the deepwater Gulf would hold 6 – 8 billion barrels of oil, and to date more than 45 billion barrels have been found. Thus estimates, such as an overall yield of only 200,000 bd from new discoveries, are likely to be considerably too low, and his estimate is that production could ramp up to over 1 mbd. New technologies are continually being evolved to deal with the challenges of producing oil from the increasingly more complex reservoirs that are being found, and thus current estimates of ultimate production are likely to be considerable underestimates when oil finally starts to flow. Staying on message relative to current Administration (and national) priorities, he pointed to the increase of over 160,000 jobs that just granting access could bring as this development moved forward. (Though it takes a long time to bring this all to pass, bear in mind that Tahiti was found in 2002, and is expected to come on line at 125,000 bd this year). The ultimate revenue to the government was projected at over $1.7 trillion.

Geoff Styles of Energy Outlook asked about the impact of the current estimate of tax changes (Pick Points 44) which Gary responded to by pointing out that the tax changes were still just a proposal, and while he felt that they were in the wrong direction and more of a challenge in the current climate (Geoff thinks the timing is wrong for cap and trade, he was optimistic for the future.)

Someone from Copious Dissent asked about the impact of climate change, obviously a current hot topic, and Gary responded that you have to accept that there is a perception in the minds of the people, and these for a time create a reality you have to live with. And that, at the moment, is where the climate change situation lies.

He went on to answer another question on AGW and corporate profits by noting that the scale of investments that the company must make each year (around $22 billion) requires that they generate large amounts of capital, and even as profits fall with the price drop for oil, they must continue to invest that amount if they were to have a future. (Tahiti, for example, cost $6 billion and they have yet to earn a penny on the investment).

Steve Rhodes of the Republican Temple asked about possible gas taxes, and the possibility of taxing folk per mile driven. The API position on this has been that taxes are not opposed, as long as they go for the support of infrastructure, but that this would be a very regressive tax, and since it will include a GPS element also carries elements of Big Brother. (My own sense on this is that it is already a dead issue).

Gail (the Actuary at TOD) has already a post up today on the impact of taxes on the industry and was curious as to the impact of proposed legislation on the smaller producers, particularly for the natural gas industry. She then went on to ask as to how $40 oil, and $4 (per mcf) gas prices would impact production. Gary pointed out that it wasn’t too long ago that those would have been very good numbers, and that, were it not for production costs which have recently gone up dramatically, the industry would be happy to work in that environment. Since prices are up it has brought a number of projects closer to the margin of profitability. But with open access to the OCS (which was the underlying message of the call) the industry could live and profit with those prices. He was less definitive in regard to gas production, admitting that while $4 might work in some rich shales, others would need $8 to be viable.

In regard to a small question I had on biofuels (since it was included in his opening statement) he felt that these were already making an impact, mentioned the food vs fuel dilemma, and that they were working with Weyerhauser on generating fuel from wood products.

On a more general note Gary closed by noting that last year the gap between possible supply and demand dropped from 4 mbd to 2 mbd. While current demand in the US is down because of the recession, and will likely continue so, in the rest of the world demand is likely to continue to grow, so that overall production needs to keep up. When the recession ends, then growth, particularly in countries like China and India will return to double digits, with the equivalent increases in demand, and we must be ready to meet that.

Well those are my notes from the conference call. Again my thanks to Jane and API for the invite.
UPDATE: Others who posted on the call are:
Bob McCarty

P44. Pick Points

Half-a-dozen or so stories of interest.

Well the new Administration now has a new budget, and there are significant changes for the fossil fuel industries. Oil and gas “preferences” will be eliminated for a total of $31.5 billion by 2019, and, as I noted earlier, there is the hope for carbon credit income of around another $80 billion. This is not a single shot proposal

It also recommended repealing the enhanced oil recovery credit, the marginal well tax credit, the expensing of tangible drilling costs, the deduction for tertiary injectants, and the passive loss exception for working interests in oil and gas properties.

The proposals have not gone un-noticed and there is the anticipated set of reactions. There is a difficult balance to be achieved between encouraging new production and extracting justifiable revenue. Unfortunately, relative to other industries the fossil fuel industries have one awkward catch attached to them. If we don’t have the fuel, we don’t have a resurgent economy. And, paraphrasing the remarks of the Saudi Oil Minister, “we cannot abandon the energy supplies from an old fuel, before we have achieved the supplies from the new.” And we are a long way from getting that amount of energy from sun and wind. So while we can take some money from the old, and give it to the new I sure hope someone has the balance properly evaluated. West Virginia, on the other hand, is just simplifying their tax structure While taxes have a habit, in the end, of being paid by the consumers, in Russia the government has just allowed the oil companies to increase charges, at a time that production costs are falling. The rationale falls back on the need for revenue if one is to continue investing in new fields.
.
The decision of the new Administration to reject Yucca Mountain as a nuclear waste repository is now final. Both the President and Energy Secretary Chu are opposed and the funding has been removed from the budget. Which is an interesting time for a company to propose processing Italian nuclear waste in Utah. Currently the case is before a federal judge in Salt Lake. However if any of this waste is shipped through Missouri it will now cost a new set of fees.

The Philippines have mandated a percentage of ethanol in their gasoline, and now are looking for ways to produce the ethanol. Cassava is the new feed crop and plans are moving ahead, against local opposition, to install some 20 plants by 2011. China has found that it is cheaper to produce ethanol from cassava than from corn or wheat where it can be grown.

Up in Canada the Ontario government is encouraging investment in solar and wind energies through the Green Energy and Green Economy Act . The concern is that to have a significant impact on need, the scale of new farms must be large, and there are still some technical issues to be resolved. There is a map of existing wind farms in Canada. In California utilities are taking a more pro-active role in encouraging solar, looking to fund 250 MW of construction over the next 5 years. The plan is to use eSolar solar thermal technology, using small tracking mirrors to focus the sunlight. Meanwhile Kender Energy is promoting a solar thermal system that heats helium as the energy transfer fluid.

In Indonesia investment is going ahead to develop a number of Geothermal Energy projects. In Georgia home owners can take the 30% credit promised in the stimulus package and add $2,000 from the state to help pay for ground source heat pumps (or geothermal heat pumps as they are called there) . It is hoped that this will allow the investment to be recouped in about 4 years., with drops in heating and cooling bills predicted to be up to 50%. (This implies an installation cost of around $20,000).

There is some suggestion that a floor has been found for oil prices, though no sooner had that been posted, then the price dropped on news of Japanese fiscal problems. Meanwhile the low price is giving Iraq some concern, since they need the revenue and are anxious to bring partners in to produce more oil.

More stories can be found at The Energy Bulletin and Drumbeat at The Oil Drum.

Cap and Trade

The Administration has stated that it is looking favorably at the concept of “cap and trade” as a way of controlling the generation of carbon dioxide from power plants, and concurrently encouraging power generation from renewable and sustainable sources that do not generate these gases. So it is reasonable to ask what exactly “cap and trade” is, and what else we might know about it.

I started by going to the MIT study (pdf) on the subject that was published in 2007. Looking for a simple definition of the term I found:

The term “cap-and-trade” is used to describe a policy that identifies greenhouse-gas-emitting entities covered by the system, sets caps on their emissions and allows trading in the resulting emissions allowances. The “entities” are the points of responsibility for emissions and they may be defined at various levels in the economic system from the coal mine and refinery gate (upstream) to the firm or gasoline station (downstream). At these points the emissions accounting is carried out. Emissions allowances (actually entries in an electronic bookkeeping system) are distributed such that the total is equal to the national cap, and covered entities must surrender allowances equal to their emissions, or the emissions that result when the fuel they supply is burned. Market trading in these allowances establishes a price on emissions that in turn creates economic incentives for cost-effective abatement.1 It is common practice to distribute allowances to the entities that are the point of regulation, but this procedure is not a requirement of the system. Allowances could be distributed without charge to any persons, firms or other organizations in the economy, or they could be auctioned.

In other words the mine/power plant/car owner is first assessed to determine how much carbon (which is short for carbon dioxide) that source will emit. After individual entities have been assessed there is a national summation of the volumes that are emitted. Knowing that, and the individual sources, a source is given a maximum capacity (cap) or allowance that it can produce in a year. As it produces the carbon, the allowance must be given up. Once the allowance is used up then, presumably, the source must be shut down until the start of the new year. If the owner of the source wants to continue using it (you still need to get to work, for example) then he/she must purchase an unused allowance from someone else who wants to sell it. The initial assumption is that the seller will do this at a price that is established in the free market. This is the “trade” part of the term. Initial prices set in the abstract to the MIT report suggest a value of $30 to $50 a ton of CO2 as the price for this allowance.

DOE and NASA have combined to create the North American Carbon Program, and there is a map available that shows the relative levels of CO2 around the nation. It is rumored that there will be a ruling, fairly soon, from the EPA finding that CO2 is a danger to the public. This ruling will likely drive standards for allowable emissions of the gas, particularly from automobiles.

"EPA's going to look at Mass. Vs. EPA and will make an endangerment finding," Browner told Dow Jones Newswires in an interview. The Supreme Court ordered the EPA in the Mass. Vs. EPA case to determine if carbon dioxide endangered public health or welfare.

The ruling will bring with it the need for rules for sources that generate CO2, and the current date for these announcements has been suggested as April 2, the anniversary of the Mass judgement. Congress is hoping to have legislation approved by Memorial Day.

There is a web site that allows you to calculate, based on your car, and how many miles you drive, how much carbon you produce. I input the information on the Camry (15,421 miles since I bought it last January, using 455 gal of gas) and I get a carbon production of 8,893 lbs – or roughly 4.5 tons. If we assume a price per ton of $45, then the cost, if I were to buy the allocation would be $200. The car I replaced was a Buick Regal, and for the same amount of driving I would have generated 13,339 lbs of carbon (682 gal of gas). The price of the carbon would be $300. (Incidentally it also allows you to calculate the carbon cost of an airline ticket – so my flight to Washington is going to cost 645 lb of carbon). The Web site I was doing the calculation on is one that allows trading in carbon offsets. These are defined as

A carbon offset is a certificate representing the reduction of one metric ton (2,205 lbs) of carbon dioxide emissions, the principal cause of global warming. Although complex in practice, carbon offsets are fairly simple in theory. If you develop a project that reduces carbon dioxide emissions, every ton of emissions reduced results in the creation of one carbon offset. Project developers can then sell these offsets to finance their projects.

There are hundreds of different types of carbon reduction projects. For example, a wind farm generates clean energy, which reduces carbon emissions from coal-burning power plants. In order to finance its operations, a wind farm can sell these reductions in the form of carbon offsets.

In the above example with the trading of my car I generated around 2 tons of carbon that I no longer used. In theory I could sell that offset to someone who needed the credit.

(In practice it is unlikely to work that way, or at that level, but it illustrates, perhaps, the point, which would apply if I did something on a much larger scale). Using a car as an example is not bad, from the point of view that about a quarter of emissions come from them in the United States, but it is difficult, short of just putting a simple tax on gasoline or diesel, to monitor how much driving an individual does, and thereby to impose penalties for driving too much.

The initial approach will therefore begin with businesses that generate significant amounts of energy, or conversely, generate power without creating carbon, and which thus would have allocations to sell. It almost has to be a national program since, as the LA Times pointed out

All existing cap-and-trade programs have one thing in common: They regulate the source of the emissions. The power plant or refinery or factory churning out the carbon is responsible for controlling its own emissions and trading credits. That won’t work in California, because from 22% to 32% of our power is generated out of state, and California can’t regulate plants outside its borders. Moreover, those out-of-state plants tend to be much dirtier than local ones. So how does a statewide cap-and-trade program account for all that pollution?

Europe provides an example of a situation where cap and trade is already in existence. It has some current problems :

The price of a ton of carbon dioxide in the current phase of the trading system has fallen to record lows recently. And although there are few suggestions the price could collapse entirely, the recent drop still is a worrying reminder that a market-based system to reduce emissions can be subject to significant volatility.

The question of price, and who gets the “profit” is obviously one that governments must decide. It has been suggested that the White House hopes that the sale of credits might raise as much as $80 billion a year, starting in 2012.

In Europe last summer a carbon credit cost $40 a ton (31 EUR) it now costs $10 (8.2 EUR). This has a negative impact on the drive for change, as Julian Glover notes:

A year ago European governments allocated a limited number of carbon emission permits to their big polluters. Businesses that reduce pollution are allowed to sell spare permits to ones that need more. As demand outstrips this capped supply, and the price of permits rises, an incentive grows to invest in green energy. Why buy costly permits to keep a coal plant running when you can put the cash into clean power instead?

All this only works as the carbon price lifts. As with 1924 Château Lafite or Damian Hirst's diamond skulls, scarcity and speculation create the value. If permits are cheap, and everyone has lots, the green incentive crashes into reverse. As recession slashes output, companies pile up permits they don't need and sell them on. The price falls, and anyone who wants to pollute can afford to do so. The result is a system that does nothing at all for climate change but a lot for the bottom lines of mega-polluters such as the steelmaker Corus: industrial assistance in camouflage.

"I don't know why industrials would miss this opportunity," said one trader last week. "They are using it to compensate for the tightening of credit and the slowdown, to pay for redundancies."

In Europe he considers that the cost of the credits would need to be in the $40 - $60 range to allow renewables to compete with fossil fuel.

It will be interesting to see how the rules over here develop.

P43. Pick Points

Half-a-dozen or so stories of interest:

I wrote earlier today about the pickup in gasoline demand that EIA had reported, and this was also noted by other folk, and the resurgence has led to a rise in the price of crude to $42 a barrel. . EIA aren’t the only ones trying to explain the situation, the Canadians also have some words on gas prices. Then there is the Rolling Stone interpretation. But rather that the technical explanation others are just blaming the rise on inflation.
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U.S. production of crude has slightly increased in the recent past, and industry are urging Congress and the Obama administration to expand drilling offshore, because although renewable energy sources will provide some future volume, at present we still need to grow basic oil production to meet the existing need. However that argument is not strong enough to stop Interior Secretary Ken Salazar from withdrawing leases for oil shale production on federal land, while he works out a plan for higher royalty rates. The Administration is however offering a second round of leases but there is opposition from local mayors near the operations. The techniques used in getting gas out of shale in the US has proved quite successful in generating production from shales that were thought impractical, and so now the Europeans are considering using them over there . Gas from shale is still only 5% of production in the USA though it is expected to reach levels of up to 50% before too long. The Canadians are now trying it, and proving along the way that just because the technique works doesn’t means it will make money. On the other side of the country, however, shale production is already making money .

It does appear that the Shotkman field is finally going to start development, with the initial engineering work being awarded to Aker Solutions who with Technip France and SBM Offshore been awarded a 25 million EUR contract on the development of a concept definition and engineering design for the project floating production unit. Recognizing that a business opportunity lies out there Russian authorities are now ready to elaborate a new EU-Russia energy agreement, to regulate relations and help speed up progress in projects like Shtokman, the Russians say. Royal Dutch Shell however remain to be convinced. They need to be sure that they will receive production rights after exploration and development, and in Russia this is no safe bet even with a local partner.

One example of potential problem comes from the Karachaganak field, where Gazprom and the Kazakhstan Government are thinking of suspending the joint venture Of course not all projects fail for political reasons Chevron has just pulled out of Northern Taiga Neftegaz a venture with Gazprom Neft after reserves in the Pyakutinsky and Aikhettinsky fields in the Yamalo-Nenets Autonomous Area, did not meet the original projections of some 45 million tons of oil.

The latest scheme is for Total to join with Gazprom and fund a pipeline to carry Nigerian gas through the Sahara to Europe, some 2,580 miles away.

As the planting season starts in South Asia the Bangladesh Prime Minister has directed authorities to ensure power to agriculture to protect food production.
The ministry of power, energy and mineral resources has stated that 130 MW of additional electricity has been added to the national grid and 700 MW more will be added by June. However the demand from the people of Bangladesh is that the government should cut the price of fuel oils.
 This year the price is 10% up on the last Boro season when the price was Tk 40. Bangladesh is still trying to find ways to economically exploit its high quality coal reserve . The proven gas resource are widely believed to soon be exhausted. In the absence of a decision the energy deficit is widening. This summer will witness massive load shedding.

Iranian and Russian technicians are conducting a test run of Iran’s first nuclear plant, a major step toward full operations. Work on Bushehr started 34 years ago, during the reign of the shah with the help of the German contractor Siemens but was suspended after the 1979 revolution. Pilot operations at the 1,000-megawatt light-water reactor, built with Russian assistance under a $1 billion contract, have long been delayed and it's unclear when the reactor could be switched on. Wednesday's tests were a computer run to ensure that the reactor's processes work properly. For the tests, technicians loaded a "virtual fuel" of lead into the reactor to imitate the density of enriched uranium, said Iranian nuclear spokesman Mohsen Shirazi.

There is an interest to form strong bilateral relations between Bulgaria and Italy to move forward with the South Stream gas pipeline.

More stories can be found at The Energy Bulletin and Drumbeat at The Oil Drum.