Alternative Energy Sources Back on the Front Pages

Given the recent runup in oil prices, hitting a record nominal price of $58 per barrel on Friday, it should come as little surprise that attention is turning back to alternatives to our old standby of Middle East crude. In today's news sources, we see a focus on alternative energy sources that's becoming reminiscent of the late 70s.

In the US, Petroleum is not a significant fuel source for our electricity, as we rely on coal for over half of our power generation. But recent advances in the solar-electric technology are making home solar power generation more and more common. Today's NY Times reports that home solar energy systems, though still not cheap, are becoming more affordable. They point out that standardization and economies of scale are driving the equipment costs down. "In moving toward the energy mainstream, solar expenses have dropped to around $8 a watt, from roughly $100 three decades ago." However, they also point out that a standard system is still going to whack your wallet to the tune of $20,000, so there's obviously still a way to go before things really catch on. A big piece of the overall equation is in State tax incentives that provide rebates and tax refunds and allow for the ability to sell excess electricity back to the utility companies. Clearly, it wont be too terribly soon that we all have our own home solar panel systems, but the stage is set to move in that direction.

Looking elsewhere in the world, msnbc.com tells us of how Brazil is positioning themselves as leaders in the production of biofuels. Utilizing their significant sugar resources, they are reducing their dependence on imported oil by refining sugar into ethanol. The government has stood behind it's ethanol policy since the 1970s, and they have a significant percentage of vehicles on the road that can run on either gasoline or ethanol.

The article points out the significant efficiencies of the sugar refining industry:

"Mills such as Sao Martinho are highly efficient. The pressed sugar-cane juice can either go to huge fermentation vats to make alcohol or be spun in centrifuges to produce sugar and molasses, depending on which product is priced more favorably on any given day. The plant supplies its own electrical power by burning the crushed outer stalk of the cane, known as bagasse ."

They point out that the US is at a significant disadvantage in this area. This is due in no small part to the limited land suitable for sugar growing, as well as because import quotas have kept domestic prices for refined sugar mostly insulated from global competition. In the US, they point out, corn is the primary source of ethanol, but the energy yield per acre is less than that of sugar cane.

They point out that legislation in the Senate energy bill will work to push the US in the direction of greater utilization of biofuels, but that these provisions are being opposed by the American Petroleum Institute. To me, this chafes for obvious reason. No matter what happens in the next 10-20 years, the US is still going to be highly dependent on petroleum, and the oil companies are assured healthy profits as far as the eye can see. Opposing this inevitable move towards renewable energy sources only hurts us all in the long run.