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National Energy Modeling with Implications for a Sustainable Energy Policy

National Energy Modeling with Implications for a Sustainable Energy Policy. Dr James R. Burns, P.E., CIRM Balaji Janamanchi Texas Tech University Rawls College of Business Administration ISQS area, P.O.Box 42101 Lubbock, Texas 79409-2101 (806)742-1547 Fax-(806)742-3193

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National Energy Modeling with Implications for a Sustainable Energy Policy

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  1. National Energy Modeling with Implications for a Sustainable Energy Policy Dr James R. Burns, P.E., CIRM Balaji Janamanchi Texas Tech University Rawls College of Business Administration ISQS area, P.O.Box 42101 Lubbock, Texas 79409-2101 (806)742-1547 Fax-(806)742-3193 Email: jburns@ba.ttu.edu Email: bjanamanchi@ba.ttu.edu

  2. Outline/Purposes: • To use Models to Explore various Policies for National Energy Resource Management • To understand the causes for cycles in energy availability and pricing • To expose the failures of energy forecasting • To assert clear implications for policy

  3. Overview Structure of the U.S. Energy System

  4. Consider the U.S. energy sources • Limited OIL, but abundant nat. gas currently • Very abundant uranium • Very abundant coal

  5. Consider the Transportation sector… • Energized by Oil mainly • Not coal, not uranium • Not solar/wind

  6. Consider the Airlines • Currently, can only run on jet fuel • No ethanol, no natural gas, no coal, no uranium, no solar or wind power

  7. Consider the electric utilities—they can be powered by…. • Oil (U.S. or foreign) (4% of electric utility power) • Natural gas • Coal • Uranium • Solar/wind • Other nuclear

  8. Clear policy implication: • we should be saving our use of oil for the transportation sector in general and the airlines in particular • We should not be expending oil to energize the • Electric utilities sector • Residential/commercial sector • Industrial sector • These sectors have other better energy source choices

  9. Write your Congressman… • Encourage our legislators to discourage through tax incentives/disincentives the use of oil in all consumption sectors except transportation

  10. How much Oil is left on Planet Earth?? • This is the $64 question • Is Oil a fossil fuel?

  11. Model Baseline Behavior

  12. Model Baseline Behavior

  13. Model Structure -- Consumption • Residential-commercial sector • Industrial sector • Transportation sector • Electric

  14. Model Structure -- Resources • Coal • Natural Gas Sectors • Uranium sector • Oil Sector • Solar Sector, which includes wind • Sectors that determine the mix of demand among the energy resources

  15. Residential/Commercial Sector

  16. Model Structure—Coal and Natural Gas Sectors

  17. Model Structure—Oil Sector

  18. Model Structure—Uranium

  19. Behavior Assuming Significant HDC Reserves

  20. Proven reserves of Oil--Worldwide

  21. Factors Affecting Oil Price

  22. The fallacy of forecasts • In 1914, U.S. Bureau of Mines predicted U.S. oil reserves would last only ten more years • In 1939, the U.S. Dept. of the Interior predicted that oil would last only 13 more years, and then in 1951, when the oil shortage never occurred, it predicted oil would run out in just 13 more years

  23. More fallacious forecasts • In a book published in 1972 entitled Limits to Growth, Dennis and Donnela Meadows claimed that only 550 billion barrels of oil remained in the earth and that they would all be consumed by now

  24. Sasser’s National energy model—wrong as well

  25. System Dynamics models of energy • Not a forecasting tool • Enables understanding of the dynamics • How such dynamical behavior is likely to play out, given certain assumptions is key • Enables cycles, structures, to be identified • Enables policy implications to be discerned

  26. Commentary • Are oil, gas and coal fossil fuels or are they of abiotic origin? • This is not just a scientific question…

  27. Evidence for abiotic origin • Oil and gas are being found deep within the Earth’s crust, especially the Russians have been successful at this • Oil in sedimentary rock contains traces of material from rock below—especially the Devonian and Cambrian rock

  28. More Evidence for abiotic origin • There seems to be way too much oil to support the hypothesis that it came from decaying biomass that once existed on the surface • Why did so many dinosaurs and plants decay in the desert of Saudi Arabia?

  29. More Commentary • If oil and gas are of abiotic origin, then there are huge reserves of oil and gas remaining below the U.S., undiscovered, in granite rock rather than sedimentary, but much further down… • We just have to drill deeper and in different places to discover them. • It means our unproven reserves are substantial

  30. Policy implications (Corsi and Smith) • Promote more scientific research to investigate alternative theories • Fossil fuel theory or abiotic theory • Expedite leases offshore and in Alaska to encourage oil exploration • If the oil is five miles down, but the ocean is two miles deep, then you have to drill three miles to get to the oil • Provide tax credits for deep-drilling oil exploration

  31. More policy implications (Corsi and Smith) • Create an oil research institute to serve as a clearinghouse of oil industry information • Develop a public broadcasting television series devoted to the oil industry • Re-establish a gold-backed international trade dollar • Establish tax incentives for opening new refineries in the U.S.

  32. Conclusion • A system dynamics model was developed and presented here that is capable of determining how the energy resource allocations will play out within each sector of the economy • It is not useful for forecasting • It is useful for finding leverage points and determining supply/demand cycles

  33. America needs America's Oil

  34. References • Burns, James R. (1982). Solar Energy and the National energy Dilemma: A Model for Policy Evaluation, Technological Forecasting and Social Change, Vol. 21, 213-228. • Corsi, Jerome, and Craig R. Smith. (2005). Black Gold Stranglehold: the Myth of Scarcity and the Politics of Oil, WND Books. • Dyson, Freeman, and Thomas Gold. (1999). The Deep Hot Biosphere: The Myth of Fossil Fuels, Springer-Verlag, New York. • Sasser, Dallas W. (1976). A System Dynamics Model of National Energy Usage, Sandia Laboratories Energy Report.

  35. Sources • [1] SOURCE: http://www.eia.doe.gov/pub/international/iea2003/table81.xls • [1] SOURCE: http://www.eia.doe.gov/emeu/international/coal.html#Reserves • [1] The Casini spacecraft soft-landed on Titan in the fall of 2005. • [1] SOURCE: http://www.eia.doe.gov/emeu/international/gas.html#WorldReserves • [1] SOURCE: http://www.eia.doe.gov/pub/international/iea2003/table81.xls • [1] SOURCE: http://www.eia.doe.gov/emeu/international/coal.html#Reserves • [1] SOURCE: National Geographic, Vol. 209, No. 3, pp. 101, March 2006. • [1] SOURCE: http://www.eia.doe.gov/emeu/international/coal.html#Reserves

  36. Questions?? • Thank you for your interest in this study

  37. Behavior Assuming Significant HDC Reserves

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