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Home Archive May 2011 Issue

May 2011

From the Editor: What Goes Around Comes Around

Recent revelations from documents seized from bin Laden’s Pakistani compound suggest that in the summer of 2010 al Qaeda planned to further intensify suffering in already damaged Western economies by attacking maritime traffic in oil, thus driving up its price. These ‘revelations’ are disingenuous at best based on even a cursory look at the history of al Qaeda and oil terrorism. Nine years ago, the French oil tanker Limburg loaded with 400,000 barrels of Saudi crude was attacked off Yemen’s coast killing one of the ship‘s crew. Those convicted in the attack swore allegiance to bin Laden and his malevolent cause. In 2002 crude oil averaged $22.81 a barrel. In 2010 the over-the-barrel price of oil averaged $71.21, and in 2011 the US Energy Information Administration estimates oil will reach an average of $103 per barrel. Al Qaeda in Iraq honed land-based oil terrorism in the deserts of that country the modalities of which are migratory and applicable anywhere in the world where new oil is found. New Limburgs, new Abqaiqs (the site of Saudi Arabia’s ’s most significant oil refinery which was attacked in February 2006), and new attacks against pipelines of significance can be expected even after bin Laden has been erased from the planet.   

With the price of oil hovering near its historic high, with oil terrorism unlikely to go the way of the Dodo bird anytime soon, and with recent events in Fukushima bearing down on a beleaguered nuclear industry, it’s high time government, industry and consumers take a sober look at where we stand both in terms of oil dependency and power generation. While US Special Forces, the CIA, DHS, Interpol and others can help protect us from future bin Laden wannabes, who is going to protect us from ourselves? Gertjan Lankhorst, the former CEO of GasTerra and present Vice-President of Eurogas, the European Gas Association, took the public to task last week calling public debate on energy largely ill-informed and superficial. This leads to other things (and we don’t need Mr. Lankhorst’s corroboration on this) such as resistance to new energy projects, to new technologies, and thus to new alternatives that can help ensure a more secure energy future for everyone. While Mr. Lankhorst may be inadvertently painting himself as a European Newt Gingrich of the energy world, it is too easy to dismiss the intent of his remarks albeit presented here in a more politically-correct fashion.

Long-term energy solutions are exactly that: long term. These solutions require a well educated workforce to devise these solutions and a well educated public to understand them. Otherwise it may be, using the US as one example, that the technological research and advanced development of energy technologies (in the safer and more palatable application of nuclear technologies as an example see Micah Loudermilk’s article this month on small nuclear reactors) will happen in places like China or India and not in the US. So on top of importing costly Saudi crude driven higher by the threat of oil terrorism, we will also be importing advanced technologies from places that are knowledge-rich but resource poor (China and India spring to mind) if we don’t take our own future in our own hands (in the United States which is resource rich but runs the long term potential of becoming knowledge poor).

To his credit, Mr. Lankhorst is pushing for a more inter-disciplinary approach to energy education, taking into account the political, economic as well as technical aspects of energy and power. I can’t help but agree with this as it mirrors our own multidisciplinary approach toward the coverage of energy security across a horizontal, hybrid landscape.

Current geopolitical realities, from the continuing effects of the Arab Spring on the energy landscape, particularly on Israel as the Egyptian-Israel gas accord comes under attack from Arab revisionists in the post-Mubarak era, to the ongoing melting of ice across the Arctic and what that means for Canada and non-Arctic states who seek access to buried hydrocarbons found there (we provide several articles in this issue from two of our JES Canadian contributors), are also part of what we might call our contribution to continuing energy education.

Keeping with our contrarian penchant in covering energy issues, Jude Clemente examines the importance and yet delineates the limits of energy efficiency as a panacea for the world’s energy woes. Hooman Peimani at the National University of Singapore gives us an Asian perspective on the future of nuclear energy across that region. As Hooman points out, Asian experts recognize that the fundamentals driving nuclear in Asia were not changed by events in Fukushima, and therefore the region’s commitment towards bolstering its own energy future in part from nuclear has not waned as a result. In fact, Asian patience with its own nuclear future is instructive. The stakes across Asia for national and regional energy security are high. While not even the IAEA has released its final report on what has been learned from the Fukushima incident, best to wait before dismissing an entire class of technology that can deliver reliable, baseload non-carbon emitting power to end-users.

So what goes around comes around. To dismiss past events is to risk undue future peril: from dismissing the threat from oil terrorism just because one bin Laden has been made history to dismissing an entire class of carbon-free power generating technology before learning what exactly did and did not happen at the Fukushima Daiichi reactor complex should be our lessons learned. The energy problems we face are daunting but can be dealt with through capacity building through education, through creative problem solving leading to innovation, and through a stern commitment to balancing the energy demands of growing populations against the gauged and acknowledged risks of providing workable solutions to these challenges regardless of their political palatability.
 

Separating Myth from Reality: A Closer Look at the Energy Efficiency Panacea

Separating Myth from Reality: A Closer Look at the Energy Efficiency Panacea

As contributor Jude Clemente points out, energy efficiency is an important aspect of any modern energy system. It is not, however, a panacea for solving all energy and power supply and demand challenges. Historical evidence points to the fact that energy efficiency at the micro-level doesn’t reduce overall energy demand on a macro-level. This can be seen in the oil market where, as prices rise and fall, in spite of efficiency gains in automotive technologies measured by miles-per-gallon, consumers adjust their buying habits accordingly e.g. buying more gas as prices fall and curtailing spending when the price of gas goes up. However, in the vehicle market, despite efficiency gains over the last three decades, Americans are driving more and consuming more oil than ever before. Clemente’s article explores energy efficiency in the United States across three domains: the macro-economy, the vehicle fleet, and the electricity sector.

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Nuclear Energy in Asia: A Post-Fukushima Perspective

Countries around the world are revisiting their nuclear safety procedures in the wake of the Japanese earthquake and its impact on the Fukushima nuclear facility. Little has been made of the fact, however, that the facility withstood the effects of the unprecedented 9.1 magnitude earthquake only to succumb to the tsunami that it unleashed. What the impact that these events will have on the further development of nuclear power in Asia, a technology viewed as critical by many Asian governments in combating energy import dependence and atmospheric pollution, is the subject of this contribution by Hooman Peimani at the National University of Singapore.

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Arctic Energy: Pathway to Conflict or Cooperation in the High North?

Arctic Energy: Pathway to Conflict or Cooperation  in the High North?

As Arctic ice melts, there is increasing interest in the High North region as an area of potential exploitation of hidden oil and gas reserves. We have previously reported on the potential for conflict among littoral Arctic states. JES contributor Hong Nong updates this perspective in speculating that rather than energy in the Arctic being a catalyst for conflict, these resources may become a driver for cooperation among states in the region and among and between non-Arctic regional actors as well.

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The Prospects and the Perils of Beaufort Sea Oil: How Canada is Dealing with Its High North

The Prospects and the Perils of Beaufort Sea Oil: How Canada is Dealing with Its High North

Tapping the rewards of Arctic oil may not be undone by geopolitics but rather by the hard-knuckled climatic, technological, and geophysical challenges of tapping this black gold. Buried thousands of meters beneath the Beaufort Sea's surface, engineers face a huge bouquet of hurdles that Mother Nature has put in man's way to reach this offshore oil in Canada's High North. Canadian energy expert, Doug Matthews takes us through some of the icy challenges facing man and machine in adding to Canada's energy security in this most daunting of places.

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Energy Security and the Spectrum of Engagement Between China and India in the Indian Ocean

Oscillating between cooperation and confrontation, China and India are racing to bolster their own national energy security. Against this backdrop, both countries rely on the Indian Ocean as a global commons area for energy transport, sparking, at least in part, a naval build-up in both nations. First time JES contributor Eddie Walsh plots out a number of possible scenarios, weaving the strategic, military, economic and social implications of the need for both India and China to secure energy for national prosperity, together with the meaning of these developments for the global security landscape.

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Turning Off the Egyptian Gas Spigot: Implications for Israel

It was only a matter of time before the fall-out from the Arab Spring would impact on Egyptian-Israeli relations. The impact is manifesting itself in calling into scrutiny the Egyptian-Israeli gas accord that shipped some 2.5 billion cubic meters of Egyptian gas to Israel in 2010. Adding to Israeli gas woes have been attacks against energy infrastructure in the Northern Sinai which since February 5th have cut off Egyptian gas deliveries to Israel and Jordan. Where all this is headed in terms of the Egyptian-Israeli gas relationship is the subject of the following by JES Contributor Daniel Fink.

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Small Nuclear Reactors and US Energy Security: Concepts, Capabilities, and Costs

The US Navy has employed over 500 small nuclear reactors on board its ships and submarines over the past 50 years without incident. With the future of large scale nuclear power on the ropes post-Fukishima, small modular reactors (SMRs) are getting a new look. Contributor Micah Loudermilk at the US National Defense University analyzes the advantage of SMRs over their larger-scale counterparts and over renewable energy power generation as well.

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