http://search.japantimes.co.jp/mail/eo20110914a1.html

Wednesday, Sep. 14, 2011

SENTAKU MAGAZINE

No rush to turn to renewables

Since the March 11 earthquake and tsunami severely damaged the 
Fukushima No. 1 nuclear power plant, faith in renewable energy 
sources has spread fast in many corners of the world as an 
emissions-free means of generating electricity. But placing excessive 
expectations on renewable energy sources could backfire on the 
Japanese economy and industry.

Major European countries like Germany, Switzerland and Italy have 
decided to do away with nuclear power. Major projects have been set 
afoot in Japan, each to construct a huge photovoltaic power plant to 
generate more than 1,000 kW of power with solar energy.

A principal impediment to a broader use of solar and other renewable 
energy sources has been their high costs. With China's entry into the 
field, such costs have been reduced remarkably and the present 
anticipation is that 1 kW of electricity can be generated at less 
than ¥10 within a few years through renewable sources.

It must not be overlooked, however, that there is a crucial problem 
associated with the generation of renewable energy that cannot be 
resolved by lowering the costs. That relates to "energy returned on 
energy invested" (EROEI) or the "balance sheet" of energy.

The ratio of EROEI is obtained by dividing "the amount of usable 
energy acquired during a given life cycle" by "the amount of energy 
expended to acquire that energy in the same life cycle."

This means the higher the ratio the more cost-efficient, and can be 
explained in layman's terms with simple examples. The cost of 
operating most of the oil wells in the Middle East is close to nil 
because the oil gushes out on its own. So, it is possible to get oil 
worth 100 times the initial energy cost needed to bore wells. This 
means that the EROEI ratio is 100. In the case of extracting oil from 
oil sands, the ratio is as low as 20 because of a huge amount of 
energy is needed to build distillation facilities and extract oil 
from oil sands.

If the ratio is less than 1, more energy would have to be expended 
than what can be acquired. That is why nobody has ever thought of 
exploring uranium contained in seawater, which can feed nuclear power 
stations for 60,000 years, or methane hydrate reserves in oceans 
surrounding Japan, which can be turned into natural gas that lasts 
for 100 years.

According to studies conducted by the Cambridge Energy Research 
Associates (CERA) of the United States and other institutes, the 
EROEI ratios are estimated at 100 for oil wells in the Middle East, 
100 for natural gas in Qatar, 30 for shale gas that requires 
injection of pressurized water and 50 for coal mining using powered 
shovels.

Compared with these high EROEI ratios given to these fossil fuel 
resources, extremely low figures are shown for others: 20 in the case 
of nuclear power, 15 for wind power and a mere 5 for solar power. 
Main reasons are enormous facilities needed for nuclear power 
generation (these facilities need a large amount of energy for 
construction and operation) and low generating efficiency inherent in 
wind and solar power generation.

All these facts and figures indicate that promotion of solar power 
generation for fear of drying up of fossil fuel reserves would be 
tantamount to relying on an energy source 20 times less efficient 
than oil, thus wasting natural resources globally.

Another serious problem would result from blindly expanding the use 
of renewable energy sources because electricity from such sources is 
unstable. Efforts to stabilize the supply of renewable electricity 
would require the use of high-tech equipment like lithium-ion 
batteries and fuel cells, which in turn consume large amounts of 
lithium, cobalt and other rare metals as well as rare earths such as 
dysprosium.

These materials are not only rare and difficult to mine but also 
heavily concentrated in a small number of countries - more than one 
half of the global lithium reserves are in Bolivia while South Africa 
and Russia have a combined 90 percent of the global platinum reserves.

Any move by these resource-rich countries to restrict export out of 
nationalistic motivation could lead to sharp increase in the prices 
of the materials. During the past decade since lithium began to be 
used in computers and cellphones, its price has shot up five times; 
the price of dysprosium has gone up 80 times during the past five 
years after it became a vital component of permanent magnet used in 
high performance motors for electric cars.

Many scientists are trying to develop new materials that would 
replace these rare metals and rare earth elements. But it is not 
likely that their efforts will bear fruit anytime soon.

Japan once was the global leader in developing and manufacturing 
solar cells and lithium-ion batteries. But its dominant position is 
being taken over by China and other Asian countries, which enjoy low 
production costs.

Moreover, the price spirals of rare metals and rare earth elements, 
much of them stemming from the nationalistic sentiments of the 
resource-rich nations, are strangling Japanese manufacturing 
companies, which enjoy large market share of key parts and components 
of high-tech products.

With the "shale gas oil revolution" initiated in the U.S., the 
confirmed global reserves of fossil fuel have increased. A ranking 
official of the U.S. Department of Energy has estimated that 
petroleum and natural gas resources can last for another 200 years.

Despite these changing circumstances, Japan seems so afraid of fuel 
resources being depleted that it believes blindly in the need for 
shifting to renewable energy sources. Ironically, such excessive 
expectations on renewable energy sources, which are believed to be 
"friendly to the environment," are encouraging certain countries rich 
in natural resources to turn more nationalistic.

The result would be endless price hikes of rate metals and rare earth 
elements, which in turn will continue to distress the Japanese 
economy and industry.

This is an abridged translation of an article from the September 
issue of Sentaku, a monthly magazine covering Japanese political, 
social and economic issues.

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