The UK is saddled with a huge pile of debt. Interest payment on debt alone is £44bn a year. That's derived from £150bn in government loans to meet the £697bn spending shortfall. £44bn with today's exchange rate will buy Malaysians 36 PLUS north-south expressways EVERY YEAR!
*It has been announced an hour ago that £1bn will be set aside for the “world’s first carbon capture and storage demonstration project”. A further £200M will be set aside for offshore wind, specifically for the development of port sites to allow the construction of turbines.
Osborne, UK Chancellor, has put £1bn into a Green Investment Bank, “the first time anybody has ever been in favour of such a bank”, he said.
More funds would come from the private sector and the sale of government assets, he said. The aim was to make the UK a leader in the green economy.
Overall the government budget on energy and to tackle climate change is trimmed 18%. The axe has also fallen on renewable energy projects seen as "not being strategic" to UK's energy policy like the tidal barrage on the Severn estuary.* The project has been scrapped.
On spending cuts in other areas, Osborne said he would “ruthlessly prioritise” capital spending on transport, green energy and the science base and that no stone would be left unturned in the search for waste.
*Information adapted from BBC News and New Civil Engineer
Showing posts with label Energy. Show all posts
Showing posts with label Energy. Show all posts
Wednesday, 20 October 2010
Friday, 8 October 2010
Biodiesel vs Petroleum Diesel
Once a while, I draw particular attention to biofuels in particular to biodiesel. This was my research interest in Cambridge.
Price tracking of biodiesel and petroleum diesel from 2006 - 2008
Biodiesel has regularly been priced out by cheaper petroleum diesel. International prices for vegetable oil prices have been more expensive than those for diesel for all of the past 15 years, hence producers would earn more by selling the vegetable oil on the international market than by converting it to biofuel.
Some governments have mandated the conversion of vegetable oil to biodiesel, However, under such circumstance it would force its use for a lower value end-use, which is bad for the economy.
When I started the research, prices of crude oil were fluctuating between $60 and $80 per barrel. By the time I completed the research, the price of oil shot up to the $100-mark. This goes without saying that future prices of oil are difficult to predict. Unfortunately, the prices of biofuels rise and fall in tandem with the prices of crude oil.
10-year price-tracking of crude oil
The petroleum and agricultural commodity markets have been highly volatile in recent years. The OECD-FAO Agricultural Outlook suggests that a persistent rise in demand for vegetable oils will result in a long-term price trend of these products averaging about 60 per cent higher prices in the 2008–17 period than the average levels in previous years.
This means, if for example, crude palm oil (CPO) prices fell to the levels in 2006 when I started my research, palm biodiesel would still require government support to be economically viable. Otherwise, fossil fuel subsidies, such as those enjoyed by a majority of southeast Asian nations, must come down. In other words, petroleum and biofuel producers must compete on a level playing field if the governments want a meaningful growth in biofuel consumption.
Price tracking of biodiesel and petroleum diesel from 2006 - 2008Biodiesel has regularly been priced out by cheaper petroleum diesel. International prices for vegetable oil prices have been more expensive than those for diesel for all of the past 15 years, hence producers would earn more by selling the vegetable oil on the international market than by converting it to biofuel.
Some governments have mandated the conversion of vegetable oil to biodiesel, However, under such circumstance it would force its use for a lower value end-use, which is bad for the economy.
When I started the research, prices of crude oil were fluctuating between $60 and $80 per barrel. By the time I completed the research, the price of oil shot up to the $100-mark. This goes without saying that future prices of oil are difficult to predict. Unfortunately, the prices of biofuels rise and fall in tandem with the prices of crude oil.
10-year price-tracking of crude oilThis means, if for example, crude palm oil (CPO) prices fell to the levels in 2006 when I started my research, palm biodiesel would still require government support to be economically viable. Otherwise, fossil fuel subsidies, such as those enjoyed by a majority of southeast Asian nations, must come down. In other words, petroleum and biofuel producers must compete on a level playing field if the governments want a meaningful growth in biofuel consumption.
Monday, 15 June 2009
Peak Oil: What does it really mean?
BP recently published a statistical review of world energy.
Saudi Arabia and Iran account for 1/3 of the global oil reserves. Venezuela is the largest oil producing country out of the Middle East region.
The report stopped short of suggesting that we are at peak oil. However, a senior energy economist from Shell whom I met two years ago in Cambridge revealed that peak oil is already behind us. We are at the decline of global oil reserves.
However BP did link up their findings with an analysis with how much time we're left before we run out of oil. According to them, if the world continues to produce oil at the rate we are at and with current estimates of oil reserves, we will only have 42 years left to find a replacement to oil.
In my opinion, the problem we are facing is not peak oil. We are not running out of oil but cheap oil. Therefore the concept of peak oil is economic rather than arithmetic. It is true we have already run out of $5 a barrel oil but we have plenty left at $200 or even $300.
Recently I was reading an article about the sustainability of our natural resources. I felt the world has over-emphasised on energy security without much said about our natural resources like metals and precious stones. Energy may be a major concern, but it is not THE major concern since we already have established alternative energy systems in place, only lacking political willpower to implement them extensively.
There are other pressing issues other than energy. If we are not careful with our priorities we may end up with a situation where we have the best electric car system or found more oil to last for another century but not the materials to build the cars.
Saudi Arabia and Iran account for 1/3 of the global oil reserves. Venezuela is the largest oil producing country out of the Middle East region.
The report stopped short of suggesting that we are at peak oil. However, a senior energy economist from Shell whom I met two years ago in Cambridge revealed that peak oil is already behind us. We are at the decline of global oil reserves.
However BP did link up their findings with an analysis with how much time we're left before we run out of oil. According to them, if the world continues to produce oil at the rate we are at and with current estimates of oil reserves, we will only have 42 years left to find a replacement to oil.
In my opinion, the problem we are facing is not peak oil. We are not running out of oil but cheap oil. Therefore the concept of peak oil is economic rather than arithmetic. It is true we have already run out of $5 a barrel oil but we have plenty left at $200 or even $300.
Recently I was reading an article about the sustainability of our natural resources. I felt the world has over-emphasised on energy security without much said about our natural resources like metals and precious stones. Energy may be a major concern, but it is not THE major concern since we already have established alternative energy systems in place, only lacking political willpower to implement them extensively.
There are other pressing issues other than energy. If we are not careful with our priorities we may end up with a situation where we have the best electric car system or found more oil to last for another century but not the materials to build the cars.
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