Sunday, February 28, 2010

The View from Early 2010: Massive Energy Changes on the Way

When you watch something closely day to day it's difficult to discern difference. But as anyone who occasionally visits a young niece or nephew knows, those kids are changing rapidly. For some reason, after years of tracking the slow and steady evolution of various energy technologies, I've gotten the feeling over the last few weeks that our relatively static energy sector is in for a major growth spurt.

And for all the great work the DOD Energy community has done trying to help the Department be more proactive with how it manages its energy issues, policy progress will ultimately pale in comparison with the seismic shifts about to hit DOD and the rest of society. You may think this is hyperbole, but ...

I don't think so. While each of these technologies has a boat-load of attendant risk, and that risk comes in multiple flavors (e.g., technological, regulatory, business), all are setting an impressive baseline that's only going to improve and likely accelerate over time.

On top of continuing steady incremental technological improvements in solar, wind, Smart Grid and storage, each of these three categories of systems could dramatically change the energy landscape on its own. Combined, they'd totally remake our approaches to generating, transporting, consuming, and making money from energy:
1. Home power generation (see the Bloom Box)
2. City (and base-sized) power generation (see small nukes)
3. Electric Cars and V2G (see everywhere, including here)
Though we still have a long way to go figuring out how to power aircraft and most tactical vehicles in ways other than JP-8, the implications for rest of DOD are huge. This could be the beginning of the end for the brittle grid problem facing CONUS bases. Also consider the potential for expeditionary energy. Will be tracking it all right here. As we always say, stay tuned!

Thursday, February 18, 2010

Demonic Duo: Al Qaeda and the Somali Pirates Eye Global Oil

This blog hasn't looked at the wider world lately; events have been largely status quo. But hat tip to Ollie for this item worth watching:

Oil & Gas Journal is citing a recent report that Al Qaeda has its eye on disrupting the safe passage of oil at one of the world's key choke points: the exceedingly narrow Bab al-Mandab straight just off the coast of Yemen.

Here are the key points excerpted from the article:
  • DOE says an estimated 3.3 million b/d flowed through the Bab al-Mandab toward Europe, the US, and Asia in 2006. The majority of traffic, about 2.1 million b/d, flows north through the Bab al-Mandab to the Suez-Sumed complex
  • By closing or disrupting the Bab al-Mandab, al-Qaeda could keep tankers from the Persian Gulf from reaching the Suez Canal or Sumed Pipeline, while also blocking southern oil transits such as China's transport from Port Sudan - a lifeline for that country's rapidly increasing appetite for energy
  • London-based Al-Quds newspaper acknowledges that al-Qaeda's control of the Bab al-Mandab "might not be easy, especially as it does not possess heavy weapons and modern boats that can be used for this purpose. But this does not mean it does not possess the logistical capabilities that can disrupt navigation in this vital international passageway"
  • Mentions Somali pirates who have hijacked more than 100 ships-some of them giant oil tankers. "They must surely have gained considerable expertise in how to intercept commercial ships in the past 5 years-during which their activity intensified."
Sounds like a good disruption to disrupt. But also a energy management contingency worth planning for. For a nice review of Bab al-Mandab and other global oil choke points, see this Energy Information Administration (EIA) summary.

Image credit: EIA

Friday, February 12, 2010

Congress are you Listening? DOD Energy Leader Needed Now

You've heard me say similar things before, but I could never muster this level credibility or eloquence. This timely piece just in from former DOD Energy Executive, Mr. Paul Bollinger:

It appears that the Obama Administration is close to formally announcing a nominee for the Department of Defense (DOD) Director of Operational Energy Plans and Programs. The Director of this office will have the opportunity to significantly impact the energy security for our military and the entire country, which makes swift confirmation by the Senate all the more important.

The DOD energy director position was created by the Duncan Hunter National Defense Authorization Act of 2009 and was signed into law on October 14, 2008. In creating this new office, Congress intended for the military, the largest energy consumer in the federal government, to lead by example as it has in the past on many social and technological fronts. Though both parties continue to rail against our dependence on foreign oil, Sharon Burke of CNAS was nominated in 2009 for the position, but still awaits Senate confirmation.

With more than 28 million acres of land and 1.9 billion square feet of buildings occupied by the military across the country, many in renewable energy rich environments, there is a tremendous untapped resource for our country to become more energy secure. These projects include the full-gamut of energy resources from solar, wind, geothermal, and waste-to-energy.

The military’s energy security projects will be highly dependent upon the private sector for financing and development because there is no new money budgeted for energy security. The unfunded federal mandates for energy efficiency, renewable energy, and alternative fuels are coming out of current military budgets during a time of war. In this respect, the private sector will have an excellent opportunity to provide a critical financing bridge through the use of public/private ventures or partnerships. In just the past two years, private sector companies have made possible the 14Mw solar project at Nellis Air Force Base, Nev. and the planned 500Mw solar thermal project at Fort Irwin, Calif.

For ambitious energy security goals to be attained, future energy projects need to be more attractive to the private sector, which means the reduction of risk and delays inherent to our budget, energy, and environmental regulatory system. DOD’s new energy director will have the opportunity to address these impediments to enhance private sector financing of future military energy projects. By doing so, the military will become more energy secure and the nation will benefit from the new jobs and businesses created, and the renewable energy added to the grid.

The major issues that merit immediate attention are:

  1. Define “Energy Security” and what it is worth to the military and fund it. The DOD budget is facing pressure from all sides; the ability to implement energy security programs for installations or efficiency Key Performance Parameters for tactical equipment acquisition will become secondary when weighed against “higher mission critical priorities.”
  2. Establish long-term contracting authority for domestically produced synthetic or alternative fuels. This authority would enable the Defense Energy Support Center to contract with the private sector for clean, synthetic or alternative fuels; and, for industry to finance the construction of plants with favorable financing. (Current law limits DESC to five-year contract authority with five, one-year options.)
  3. Review and modification of the Office of Management and Budget (OMB) scoring of energy projects on military bases. Since the 1990’s OMB has required long-term government contracts to be paid, for the full amount, in the year of execution. This makes long-term contracts for renewable energy projects difficult to develop on military bases. Enabling the military to contract with the private sector for renewable or alternative energy projects that are budgeted and funded over the life of the contract would greatly expedite job creation and the growth of clean energy.
  4. DOD needs to work with Congress and Department of Energy (DOE) to have “Energy Policy Credits” awarded to the military in place of Renewable Energy Credits (RECs). There is a value associated with the ownership of RECs that the private sector needs to make projects financially feasible. REC ownership also is used by DOE to determine if a federal department is meeting renewable energy goals. Since the economic value of the REC remains with the private sector financier of the project, the military also should receive credit towards meeting renewable energy goals. This legislative or regulatory fix may impact how carbon credits are accounted for in the future.
  5. DOD should establish an energy savings fund that allows for installations to share in the savings generated by more energy efficient operations. The Navy has a program that benchmarks the energy consumption of non-nuclear ships on an annual basis. Captains who operate their ships in an energy efficient manner can meet or beat the fuel consumption benchmark and become eligible for an “energy bonus” that comes back as additional “quality of life” funds for the ship.
Last, but not least the energy message has to be focused on the soldiers, sailors, airmen and marines, who execute the military’s critical mission every day. This is not a program that will succeed by waving environmental flags in front of the military leadership. The focus must be on energy efficiency from a warfighter’s perspective and how it will create a more lethal, expeditionary and sustainable force. The environment will benefit from the military reducing consumption and increasing efficiency, but it is the not the message to effect the change in a time of war.

The new DOD energy director must recognize and appreciate our war fighters for making the ultimate commitment and who now are challenged to make the military more energy secure. By resolving these project financing impediments the director will provide the military with the opportunity to once again lead our nation in a new direction of energy self-sufficiency.

Paul P. Bollinger Jr. was the first Deputy Assistant Secretary of the Army for Energy and Partnerships; and, the former Special Assistant to the Senior Energy Executive in the Air Force during President George W. Bush’s Administration. He is an Adjunct Energy Fellow at the National Defense University.

"The views expressed are the author's and do not necessarily reflect the policy or positions of the National Defense University, the Department of Defense, or the U.S. government."

Tuesday, February 2, 2010

Nolan on 2010 USMC Expeditionary Energy Symposium

Here's Sabot 6's Dan Nolan again, this time with some laudatory commentary on the recent USMC Expeditionary Energy Symposium:
The Marines executed another flawless amphibious landing, coming ashore in New Orleans to conduct the USMC Expeditionary Energy Symposium. From 25 to 27 January, the Corps’ senior energy officer, the Commandant, GEN James Conway led the assemblage of DOD and industry leaders through the rapidly evolving plan to increase expeditionary capability and reduce reliance on length supply lines. Briefings and panel discussions focused on operational mobility and infrastructure. Concurrently, GEN Conway conducted a senior leadership conference and took the opportunity to bring those leaders into the conference so they could get his intent first hand. There were no stunning revelations; however, the briefings on the Experimental Forward Operating Base (ExFOB) helped industry better understand how to participate in this important effort. The intent of the ExFOB is to identity mature, relevant technologies that can be “proofed” rapidly and then deployed to forward areas to help Marines reduce their logistical footprint. COL Charrette, the new appointed head of the Expeditionary Energy Office helped put this process in perspective for industry attendees. COL T. C. Moore briefed the results of the Marine Energy Assessment Team and personally led several Bourbon Street sorties.
One of the most innovative events at the symposium was the “Pitch a Capability” session. Industry representatives were given the opportunity to provide ten minute presentations on their technologies or services to groups of USMC acquisition and operational leadership. Over the course of the symposium, they reviewed dozens of presentations and provided meaningful feedback to participants.
Having recently returned from Afghanistan and Qatar as part of the USAF Energy Assessment Team (more to follow as information is cleared), I was again heartened to see Service senior leadership stepping up to focus on this critical issue. The Air Force, Navy and Marine Corps are present for duty. Unfortunately, the Army ... [HORN SOUNDS].
Sorry Dan, that's all we have time for today. Stay tuned for Dan's incisive analysis of Air Force energy audits in Afghanistan and to find out how he really feels about the Army's leadership energy leadership.

Monday, February 1, 2010

QDR 2010 Directly Addresses DOD's Operational and Facilities Energy Issues

I admit it: back in June of 2009 I had my doubts. But the 2010 Quadrennial Defense Review (QDR) is finally out, and energy got its due - approximately one page out of one hundred twenty eight. Not bad, when you consider previous QDRs never considered the topic. Starting on page 84 of the report, I've captured and reprinted the 4 energy specific paragraphs here and will break it down, with the points I consider most important / helpful highlighted in yellow.

First, I like that they take a stab at defining energy security, and when they do it's kept short and sweet:
Energy security for the Department means having assured access to reliable supplies of energy and the ability to protect and deliver sufficient energy to meet operational needs.
There's a lot they leave out that others try to cram in. I say: good job. Re: the definition - just want to make sure we don't spend so much time and energy on the protect and deliver parts that we significantly impair our ability to prosecute war ... or whatever else it is our troops are told to accomplish. The QDR addresses that concern in the next sentence:
Energy efficiency can serve as a force multiplier, because it increases the range and endurance of forces in the field and can reduce the number of combat forces diverted to protect energy supply lines, which are vulnerable to both asymmetric and conventional attacks and disruptions.
... and points out additional benefits to fielding a leaner, meaner force. So how's this goodness going to come about? By baking better energy thinking in right up front the way it's already been told to do by congress, and the way two Defense Science Boards and the GAO have already recommended:
DoD must incorporate geostrategic and operational energy considerations into force planning, requirements development, and acquisition processes. To address these challenges, DoD will fully implement the statutory requirement for the energy efficiency Key Performance Parameter and fully burdened cost of fuel set forth in the 2009 National Defense Authorization Act.
Who's going to make this happen? Why the DOD Energy Boss, of course. The QDR language makes it sound like a fait accompli:
The Department will also investigate alternative concepts for improving operational energy use, including the creation of an innovation fund administered by the new Director of Operational Energy to enable components to compete for funding on projects that advance integrated energy solutions.
Sounds good, but I've got the feeling they're being a little too optimistic on this one. See here.

I like everything in this next two paragraphs, but I'm going to let them ride without comment and just a few highlights:
The Department is increasing its use of renewable energy supplies and reducing energy demand to improve operational effectiveness, reduce greenhouse gas emissions in support of U.S. climate change initiatives, and protect the Department from energy price fluctuations. The Military Departments have invested in noncarbon power sources such as solar, wind, geothermal, and biomass energy at domestic installations and in vehicles powered by alternative fuels, including hybrid power, electricity, hydrogen, and compressed national gas. Solving military challenges—through such innovations as more efficient generators, better batteries, lighter materials, and tactically deployed energy sources—has the potential to yield spin-off technologies that benefit the civilian community as well. DoD will partner with academia, other U.S. agencies, and international partners to research, develop, test, and evaluate new sustainable energy technologies.
Indeed, the following examples demonstrate the broad range of Service energy innovations. By 2016, the Air Force will be postured to cost-competitively acquire 50 percent of its domestic aviation fuel via an alternative fuel blend that is greener than conventional petroleum fuel. Further, Air Force testing and standard-setting in this arena paves the way for the much larger commercial aviation sector to follow. The Army is in the midst of a significant transformation of its fleet of 70,000 non-tactical vehicles (NTVs), including the current deployment of more than 500 hybrids and the acquisition of 4,000 low-speed electric vehicles at domestic installations to help cut fossil fuel usage. The Army is also exploring ways to exploit the opportunities for renewable power generation to support operational needs: for instance, the Rucksack Enhanced Portable Power System (REPPS). The Navy commissioned the USS Makin Island, its first electric-drive surface combatant, and tested an F/A-18 engine on camelina-based biofuel in 2009—two key steps toward the vision of deploying a “green” carrier strike group using biofuel and nuclear power by 2016. The Marine Corps has created an Expeditionary Energy Office to address operational energy risk, and its Energy Assessment Team has identified ways to achieve efficiencies in today’s highly energy-intensive operations in Afghanistan and Iraq in order to reduce logistics and related force protection requirements.
Finally, the last paragraph brings it all home with the intent to address the brittle grid problem.
To address energy security while simultaneously enhancing mission assurance at domestic facilities, the Department is focusing on making them more resilient. U.S. forces at home and abroad rely on support from installations in the United States. DoD will conduct a coordinated energy assessment, prioritize critical assets, and promote investments in energy efficiency to ensure that critical installations are adequately prepared for prolonged outages caused by natural disasters, accidents, or attacks. At the same time, the Department will also take steps to balance energy production and transmission with the requirement to preserve the test and training ranges and the operating areas that are needed to maintain readiness.
They covered all the bases (no pun intended) as far as I'm concerned. There's another two-hundred or more pages of detail I would have like to have seen included on energy, but if they had, given all the other challenges facing the department at this time, it wouldn't be a QDR.

I'll pursue the usual path from this point on: reminding the Department that this is what it's told itself it needs to do on energy matters, and nudging it to move faster when it looks like other challenges, or more likely, mind-numbing bureaucratic inertia, tribal squabbling and/or status quo thinking get in the way of desperately needed progress.

Photo Credit: abnskyshark / Andrew Michael Smith @ Flickr