Like most of the developed world, New Zealand imports most of its oil from overseas. And it doesn’t come cheap. We’ve got to sell a whole lot of milk and lamb and whatnot to settle the bill at the end of the year. In fact, oil and petroleum products are our single largest category of imports by value. Even before you add in what we spend on vehicles.
In 2012, New Zealand imported $8.4 billion of oil-based products. Most of what we import is crude oil with a bit of petrol and diesel thrown in for good measure. The Marsden Point refinery turns the crude oil into various products, including petrol, diesel, jet fuel and bitumen.
Also in 2012, we exported $2.0 billion of the crude oil extracted in NZ. Hang on, you might ask, why do we export oil – why don’t we just keep it here so we don’t have to import as much? According to the agency formerly known as MED, “New Zealand’s locally produced crude oil is generally exported because of its high quality and therefore high value on the international market”.
“Net” imports are our imports minus the imports, or $6.3 billion. Why should we take an interest in these imports and exports? Well, for one thing, there’s a lot of money involved. New Zealand as a country is heavily in debt, and we have run current account deficits since the early 1970s – since around the time when the first oil shocks hit. Those high oil prices had plenty to do with the country going into deficit, and they have helped to keep us there over the years. I’d be interested to hear from anyone who’s got some New Zealand-specific research on this?
Anyway, forty years of deficits later, New Zealand had a current account deficit of $10.5 billion in 2012. It seems pretty obvious that if we make smarter transport decisions and reduce the amount of oil we use, we won’t have to import as much, and this deficit will shrink.
There’s no magic wand we can wave, and the simple fact is that New Zealand and the rest of the world will continue to depend on oil-based transport for the foreseeable future. But cutting down on those oil imports is definitely a goal worth having.
Processing...
Oh, imagine if NZ used Norway’s example to make the most of our resources.
http://thetyee.ca/News/2012/07/25/Norway-Oil-Wealth/
This may be a naive question or stating the bleedin obvious and I’m not setting out to dilute the sentiment of your article, but do we know how much of the oil we import is used for transport purposes? Oil has other uses such as being the source of raw materials for products (e.g. plastics and synthetic materials) and also there’s fossil-fuelled electricity generation. As I understood it, we’d be screwed without oil and not just for getting around. If nothing else, I’d be interested to know how much of the oil we import gets gobbled up on getting us around.
GMC: http://greaterakl.wpengine.com/2012/08/28/oil-strike/
Boom! Thanks Patrick 🙂
In 2005 oil was used by:
transport – 84%
industry – 6.7%
agriculture – 4.9%
the commercial sector – 3.5%
the residential sector – 0.9%.
from http://www.teara.govt.nz/en/energy-supply-and-use/page-3
Norway produces about 2m barrels a day. NZ produces about 0.07m barrels a day. Similar size populations. It is hard to see what th Norwegian example can really teach us.
was meant to be a reply to Bryce P above
Dan, did you read the bit about what the Norwegians do with the income or the kind of deals they did to maximise the oil exploration? If we managed to preserve 30% of what Norway do we would be laughing (and not be too concerned about Fonterra).
Yes, I love the Norwegian model, no arguments with it (except that they should leave more of the oil in the ground — someone has to). But raising the rents on NZ oil is not going to raise a whole lot of money because our oil industry is small. The small size of the resource also gives us less bargaining power. I’m not saying NZ shouldn’t go for a better deal, just that even a very good deal wouldn’t have a huge impact on govt finances.
The key difference with Norway is that we are net importers of oil. We are in Importistan; wrong side of the ledger. John is absolutely correct to be focussing on this as it highlights how infinitely stupid it is to be spending billions of borrowed dollars to further entrench our autodependency. Yes RoNS I’m looking at you. Dumb and daft.
Global oil price goes up and huzza! we earn more from our small oil export [1.5b more between 2007-2012 in the charts above] but alas, we also spend more importing the stuff [2.5b more above]. Always look at the net figure.
No policy to wean our systems and economy to a lower level of dependency on this oh so useful yet finite and polluting resource.
makes the projected expenditure on the Roads of Significance to National even more foolhardy
Related:
I’m still dubious about EVs [right now they are simply a way for the wealthy to opt out of paying fuel tax, and feel smug about it], but willing to be proved wrong [if economies of scale etc can bring down the prices dramatically] so it is interesting to read Tom Murphy’s move over on Do The Math. Of course we don’t have their subsidies, and the cars are even more expensive here. But if money no object [ha!] we do at least have much cleaner electricity…
http://physics.ucsd.edu/do-the-math/2013/08/man-bites-ev-will-ev-bite-back/
Right, while EVs will probably have lower lifetime energy costs than petrol driven cars pretty soon and they get the air pollution out of the cities, they don’t fix anything else that is crap about car reliance. And with cheaper running costs, they may induce more driving.
Storing electricity chemically [batteries] has pretty nasty lifetime environmental costs.
First up, great post John.. importing $ 8 bn of oil, and using $ 7 bn of it (and rising rapidly) mostly just to cart ourselves around is pretty dumb from a NZ Inc perspective, never mind an environmental perspective.
Tom Murphy’s piece on EVs is spot on, great observations and as usual good commentary and dialogue too. I love the way he compares apples with apples, e.g. when we fill the tank we’re actually pumping a 3 MW power supply for 2 minutes. Tom’s main point (as succinctly summarised by Patrick here) is spot on.
On the energy supply side, arguably solar PV installations present the same challenge.. people who can afford it can, by installing PV, buy forward a decent chunk of the next 10+ years of their electric power.. but ultimately, if enough people do that (and why shouldn’t they?) what happens to the price the rest have to pay, given that PV does nothing to relieve the peak demand on the supply network?
Pumped storage to the rescue 😉
http://poppware.de/Storage_for_a_secure_Power_Supply_from_Wind_and_Sun.pdf
I’ve read about that before. A very interesting concept.
Plus, for example, there are 7 gallons of oil in each car tyre let alone all the plastics and other oil based materials. Replacing the current world wide fleet of cars with EVs is likely to consume so many resources that it is simply not doable – and that isnt taking into account the growth in cars world wide.
More electric bikes were sold in China last year than cars. Then there are electric scooters and motor bikes. Single passenger, lower weight vehicles are a much better option for electric vehicles than 500 kg cars with one passenger.
My concern with electric vehicles is that although the energy is sustainable, the negatives of single occupancy vehicles remain- less community cohesion, health issues, poor environment for pedestrians and cyclists etc etc.
+1000
Health issues of electric vehicles??? A change from an ICE vehicle to an electric vehicle surely has net positive health outcomes. I (and the rest of my family) don’t use public transport – in this part of Auckland it’s 25 km to the nearest PT so it’s just not an option. Electric vehicles represent a genuine (albeit expensive at present) solution to a number of negatives of IC engined-cars and the idea that I would buy an electric vehicle simply as a way to avoid paying fuel tax while feeling smug is just city-centric opinionated nonsense.
You misunderstand me… I’m not saying that wealthy purchasers of top end EVs are setting out to avoid fuel tax, but rather they are quite sensibly enjoying spending less on the operating costs of their car and feeling good about their lower emissions… but can only do this because the higher capex [and in fact a probably higher total spend] is relatively painless.
The fact that they don’t contribute to the NLTF is an unintended consequence of this rational action.
This has two likely outcomes if EVs get any kind of market share: 1. The current insane spending on the RoNS all predicated on rising funds in the NLTF will hit a big wall. So 2. there will be a push to have EV and PHEV owners contribute somehow, most likely with Road User Charges, which will lead to a shitstorm with those that believe they should be incentivised for their climate change and energy independence qualities.
“I’m not saying that wealthy purchasers of top end EVs are setting out to avoid fuel tax, but rather they are quite sensibly enjoying spending less on the operating costs of their car and feeling good about their lower emissions”
Am I correct in assuming that this is a hypothetical scenario? How many wealthy purchasers of top end EVs are there in NZ? The govt. has made it clear that EVs are subject to RUCs but they have been temporarily suspended (presumably to incentivise uptake) until 2020 (IIRC). Any purchaser who ignores this is just deluding themselves.
As for the RONs – not insane (that’s offensive to those with mental health issues) but, based on the data I have seen, reckless, irrational and financially inept (most of them). No doubt there is a hangover brewing but if EVs constitute a significant portion of private vehicles my guess is that the purchase price will have come down (through economies of scale) and paying for road access will be seen as reasonable (magnitude notwithstanding).
It hadn’t really occurred to me before, but there’s a big difference between 1980s Think Big and today’s RONS- in the 1980s they were trying (however badly) to get some energy independence. But today such laudable motivation isn’t even there.
The small pleasure of saying “told you so” to Gerry in the 2020s won’t in any way compensate for the financial burden we’ll all face to fix the mess.
Look at the increase in oil imports from 2007-2008. An increase of $2b that was sucked out of the economy in a year.
You’d be better looking at the increase in the net position: about $1b worse in 2012 than in 2007.
This is great info, especially the key stats around petroleum and vehicle imports,and dairy exports.
However, they don’t quite tell all the story. I’d like to see the export earnings of tourism, electronics and computer software development and banking and financial services added. One of the big selling points of the CRL to me is the agglomeration effects that may encourage a boost to the portion of our export earnings generated by “tertiary” industries in future.
It would be a nice thing in future to see the portion of our nation’s income generated by such tertiary industry enjoy similar growth to the massive increase that the dairy industry has generated over the last few years. An article in the Herald today points to Estonia as a case study of a country which has transitioned to a high tech ICT exporter.
There’s more that it doesn’t tell on the downside too. That oil we export doesn’t belong to us. Sure the money comes in, but then it goes out again in the ‘invisibles’ account to the offshore owners of those oil extraction companies that Mr Joyce has decided we should tax less.
Yup, these export/ import stats don’t cover services. The funny thing about tourism is it’s not just a major export, it’s also a pretty major import… us Kiwis love to travel, apparently.
A comparison between NZ and Norway is laughable. As someone already pointed out, Norway is a Net (and very large) oil exporter and NZ is a net importer. Also Norway has punitive taxation, the tax level in Norway is among the highest in the world. They have 25% VAT. They have wealth tax, property tax, National Insurance tax, A beer will cost you $15, reason enough not to want to copy its financial model.
The oil New Zealand exports is mostly condensate which is far too good to process in Marsden Point refinery and other products that we have an excess from refining (petrochems, Jet fuel). Our refinery runs heavy crudes which have a high bitumen content. These are comparatively ‘cheap’ compared to sweet light crudes that make more light end products (petrol being one of them). Of the crude we do produce (from Tui) the output was down to only 3.05 million barrels in Q1 of this year. Statoil, Norways state oil company output was also down in Q1 this year but they produced 2.6 million barrel PER DAY!
We could extract more condensate but that would involve deep sea drilling and I guess most New Zealanders do not want a Deep Water Horizon event off our coastline.
We also import some mogas (petrol), about 30’000’000 litres a month and some diesel, about 10’000’000 litres. Quite a lot of NZ’s imported fuels go towards commercial use and as much as you may like to eradicate the car, no one is going to run their farm on horseback and mule anymore.
For sure it would be a huge game changer for NZ’s economy if we moved away from oil dependency but last time I suggested we invest in this (Hydrogen powered fuel) you all treated this like witchcraft.
Even with our small population and hydro energy it is doubtful we could run all our transport off electricity. We would be one long hot summer away from grinding to a halt. Bio fuels are not the answer either. Becoming dependant on imported bio mass is no smarter than importing fossil fuel and replacing fields of sheep and cows with rapeseed would be economic suicide. Bio Fuel is also one crop failure away from grinding us to a halt.
However, with lots of sunshine and lots of seaweed we could be harnessing cheap hydrogen which could then be stored in liquid form and used in existing vehicles with little or no requirement for upgrading our transport fleet. Instead of toxic chemicals spewing out of exhausts our cars would spit out nothing more than a bit of steam. This is why an investment in roads is future proof and can be the answer to a green and sustainable transport system for New Zealand.
Phil, I apprecate your analysis of NZ v Norway and our oil / petrochemical requirements.. looks entirely credible to me. Up to and including your horseback and mules comment. I’m less convinced by your future projections.
Firstly, you raise a straw an argument in countering a point that no-one has made about running “all of our transport” by electricity. I would suggest many readers of this blog might support policies amed at disincentivising use of private ICE cars for urban commuting or on the other hand encouraging long haul carriage of freight by electric trains.. but that’s a long way off “all transport”. Any rational analysis would surely conclude that productive farm machinery would be at other end of the scale of difficulty. Apart from air travel I’m not sure what category of transport would be harder to de-carbonise.
Secondly, you assert that our electricity supply could deliver sufficient energy to power NZs transport requirements. On the contrary, there is abundant resource to “fuel” every car in NZ if they were 100% EVs (I will have to dig out the reference, sorry I don’t have this to hand).. there would certainly be issues to manage around peak demand, especially on the local networks, and there would need to be (some) new sources of supply brought on-line but there is no shortage of renewable energy here. None whatsoever.. NZ is blessed with abundant riches in this regard.. of which hydro has been relatively well developed, but wind and solar have not (and nor have potentially attractive future sources such as tidal).
I would also suggest that alongside your concern about the security and efficacy of our (indigenous, renewable) electricity supply is a misplaced over-confidence in the security and efficacy of our (overseas, non-renewable) oil supply chain?
I would frame the challenge differently: in order to help balance our books, and protect NZs (potentially fragile and/or costly) oil supplies for uses for which there are no realistic alternatives, such as farming or air travel, we ought to actively see to reduce our dependency on the stuff elsewhere.. Starting with private ICE car travel for urban commuting, where (electric or not) PT or active travel modes.. or, yes EVs, for those who choose, or who live far from PT, or work odd hours, or need the convenience of their own vehicle, etc.. present straightforward alternatives.
I would welcome your statistics on NZ’s ability to fuel 100% EV. I’d be very happy if that was the case but remain sceptical. It wasn’t that long ago that Auckland went weeks without constant electrical supply. Hydro is a good electricity generator but we are in trouble if we have a serious drought. Wind Turbines are very noisy, expensive, and unpopular. Tidal can create as many problems as it solves (coastal erosion, silt build up, interference with marine ecology). Solar, I agree is a resource we should be looking at.
I am sure we both agree that any transport planning has to meet the needs of the majority of the publics need while at the same time not breaking the bank. Some of the ideas mooted on this site, whilst honourable in nature, are pie in the sky when it comes to being able to be funded. I would love NZ to have a France like Electric rail system which a train that could get from Auckland to Wellington in 3 hours. Its not going to happen in any of our lives, if ever. Whilst such a rail network would solve a huge range of issues (including the high cost of housing in Auckland) we would never be able to afford to build it and we will never have the population (I hope) to justify it.
Some ideas here are good though. A Marsden to Auckland rail link (combined with moving Ports of Auckland out of the city) would be a great way to get trucks of our highways and reduce the carbon footprint in the longer term. A project like this probably is affordable and is probably a better spend than extending the motorway any further than Warkworth.
What I do not agree with though is a shift away from road based transport. We have the roads and vehicles in place and a car or Bus is a lot more flexible to transport needs than a passenger rail network. Given NZ’s population and finances we should continue to invest in our roads as number one priority and build the other projects Marsden to Auckland freight line etc as and when we can afford them.
Technology exists to reduce our dependence on imported fuels by using solar to create hydrogen. We should be investing in this as the infrastructure (roads and filling stations) already exists and the existing transport fleet (Cars, trucks and buses) does not need much investment.
Hi Phil, I’ll leave the 100% EV thing for another post, but yes a number of studies have been done for NZ and they’ve all concluded that it’s possible. Looking at private vehicle travel, that is.
Who is it who wants to “eradicate the car”? I don’t think I’ve ever read anything like that on this blog.
Phil, incorrect on at least three counts:
1. Wind turbines are not particularly noisy – average noise levels standing beneath a modern wind turbine is in the 40-50dB range, i.e. much less than your average road.
2. Wind turbines are not particularly expensive – with the exception of some geothermal projects, wind projects in NZ have relatively low long run marginal costs of any energy form, and they are unsubsidised. Recent strengthening in the NZD versus EUR may have improved situation further.
3. Wind turbines are not unpopular – or certainly not more so than other major electricity generation schemes. Most major proposed schemes have been granted consent over the last few years, which is why wind – along with geothermal and gas – has accounted for a large chunk of the growth in NZ’s electrical energy demands over last 5 years. Last time I checked the MED energy data file (6 months ago) they were still the fastest growing source in relative terms.
Best not mention the 39 million birds killed every year by wind turbines.
Best to detract attention from the fact that your previous statement was complete bollocks by trying to change the subject.
who are you referring to when you say “you” want to eradicate the car? I assume you mean either John P or the bloggers generally.
For the record, most of the bloggers on this site own and operate cars. I personally enjoy driving, which I’m sure I’ve stated numerous times over the years. It’s not that the bloggers want to eradicate cars, we just don’t want them to rule our cities and our lives the way they do currently in Auckland.
In the future I’d suggest you avoid unsubstantiated/false allegations about our preferences as it detracts quite a lot from your comment.
“but last time I suggested we invest in this (Hydrogen powered fuel) you all treated this like witchcraft”
Wasn’t it you who was suggesting Joe Public filling up his vehicle with liquid hydrogen? Not surprising that you weren’t taken seriously. Highly dangerous, wildly impractical and with an abysmal round-trip energy efficiency.
Hydrogen is NOT highly dangerous or wildly impractical… where do you get these ideas from? Technology now exists for liquid hydrogen to be stored at ambient temperatures and pressures. This means it can be delivered clean and safe just like filling your car with petrol. The fuel tank can be made of plastic rather than metal (which is safer than the steel tanks in road cars) and a 0.44m3 tank is estimated to give a small car range of 300kms.
Now I am not going to pretend Hydrogen fuel is not dangerous if handled by an idiot but then do you feel safe around petrol? Any flammable liquid is dangerous if you are a complete moron. I do however find nothing impractical about pulling into an existing service station, putting the nozzle of the fuel pump into my car fuel filler, paying and driving off…. Millions of Kiwis manage this every day. Also for the substantial cost savings and benefits to the ecology and economy of NZ I wont object to filling my car up twice as often as I would on petrol. If that was an issue for ‘Joe’ then we would all be driving diesels.
Liquid hydrogen is what I wrote NOT hydrogen. At present liquid hydrogen is cryogenic requiring very low temperatures (<20K) and high pressures to keep it liquid. You may believe that technology exists to store liquid hydrogen and ambient temperatures and pressures but that doesn't make it so. People choose to believe all sorts of whacky stuff in the absence of evidence. Having the public handling a cryogenic liquid is wildly impractical. Perhaps you can fill us in (!) on how you propose to produce and distribute this liquid hydrogen and the energy efficiency of using hydrogen as a fuel.
I can lay my hands on a 40 mm hydrogen pipeline later today. It's pressurised hydrogen gas produced by hydrolysis and it is blended with nitrogen to produce a reducing atmosphere for furnaces. Distribution of hydrogen in pipelines as a gas is well understood. Distribution of liquid hydrogen around the country? Unfeasible.
MFD, you say I ‘may believe’ and yet there is a company in the UK that has developed this technology. They have won the UK Government Technology Strategy Board Grant, The Shell Springboard Award, and secured funding from NASA…
But of course you dont believe 🙁
No I don’t believe a company in the UK has technology to store liquid hydrogen at ambient temperature and pressure. I don’t believe in the tooth fairy or Santa Claus either. Does the company have a name? Any published papers?
MFD, Who are you to believe or not? The UK Government has given them a technology grant, they won the Shell Award for the ‘next big idea in low carbon enterprise, and they are working with NASA.
I am sure that the company concerned will get over your disbelief 😀
Quick point: you can have liquid hydrogen at ambient temperature, or ambient pressure, but not both. Liquid hydrogen for transport applications would be highly pressurised. Although yup, the safety issues are certainly surmountable.
You can have liquid H at ambient temp and pressure. It is a relative new technology invented by a UK company. I think its a very interesting project and something we should all be excited about. Zero emission fuel that can be delivered with the same convenience as petrol and diesel with little or no upgrade to existing transport fleets, who wouldn’t want that.
I am about as excited about it as I am with the emails that tell me how much money I have won in lotteries for which I have not bought a ticket. Using an energy vector such as hydrogen that results in energy efficiencies of around 20% doesn’t stimulate even the merest frisson of excitement. Perhaps I’m just not the excitable/gullible type.
MFD, would it be rude to ask what you do for a job? I don’t mind to tell you I work in Oil Trading and therefore I have a very big interest in transport fuels, and alternative energy. Given that I read 100’s of reports every week on the subject that are not available to the general public I would suggest that I am ahead of the game on knowing what technology is out there now and what is on the horizon.
It wasn’t so long ago that the public scoffed at the thought you could drive a diesel car on cooking oil. Still today most people cant get their heads around the fact that very soon a leading European airline will be flying on synthetic jet fuel made 100% from recycled city rubbish.
Stick with the Flat Earth theories if you want but at over $100/bbl for oil, the world is moving in new directions very fast.
Hydrides? Not liquid hydrogen, Phil. You are clearly out of your depth. Hydride storage has been around for some time
How is storing hydrogen in the form of hydrides going to address the energy efficiency shortcomings?
“You can have liquid H at ambient temp and pressure”
No you can’t. There is this thing called physics
I took a look at a hydrogen phase diagram and while you can have liquid hydrogen at ambient temperature it would have to be at around 400 bar so the vessel would have to be rated at considerably more than that (must check if AS4343 and AS/NZS 4041 cover liquid hydrogen). Just not economically feasible. Storage of liquid hydrogen at any sort of sensible cost requires very low temperatures. Studies of hydrogen as a domestic transport fuel that I have seen to date involve storage as a compressed gas, a hydride or some type of adsorption technique. I don’t have major safety concerns re compressed gaseous H2 but it’s still going to be more challenging than LPG (given the very low ignition energy and the propensity for migrating through most substances). If the public is not permitted to fill their own LPG cylinders it’s unlikely that they will be able to do their own filling with compressed H2.
The following paper deals with key issues relating to H2 as a transport fuel. Note figure 9 which illustrates the abysmal energy efficiency of using renewable electricity to produce H2 by hydrolysis and use as a transport fuel: 19% for liquid hydrogen and 23% for compressed hydrogen vs 69% for battery electric EVs:
http://www.fuelcellforum.com/reports/E21.pdf
And yet NEW technology has overcome this problem. The technology is based around the encapsulation and nano-structuring of chemical hydrides in plastic. This means that they can be handled in air, and allows the hydrogen to be released quickly and cleanly upon heating. We make them into plastic like pellets; heating one gram of pellets will produce one litre of hydrogen (at normal pressures and temperatures).
This technology is seen as so strategically important that the UK and US Governments are direct investors in the private UK company….. But sorry….obviously a transport blog in lil ol Auckland nul zuland knows better 🙁
Rather than denigrating the blog and New Zealand in general, it would be helpful if you gave some links to the technology you are talking about. Is that really too much to ask.
I am not an expert but from MFD’s posts he obviously is – so not unreasonable to ask for evidence.
Do I have to do everything for you guys? I mean, obviously you could have just googled who won the awards and worked it out for yourself. http://www.cellaenergy.com/
As for MFD being an expert….I guess Im waiting for him to tell me what he does for a job, I already asked because he doesn’t sound much of an expert to me.
Would you say the same thing to lecturers at university if they asked you to cite evidence in your academic essays – “Just go and look it up dude”! I think you would be staring down the barrel of an F there.
This blog tries to be more academic and evidence based than other blogs like Whale Oil or Kiwiblog. And generally I think achieves that.
Per MFD – “AS4343 and AS/NZS 4041 cover liquid hydrogen” – Maybe I am uninformed but I have no f-ing idea what those things are and it sounds like he knows his stuff, whether that be as part of his job or not.
Had a look at cellaenergy – interesting. And well worth the investments by the US and UK governments. However, I can’t help feeling that just like Nuclear Fusion energy, the claim – its ‘just around the corner’, is another way of saying – this is Blue Skies research…eta unknown! This does not mean that we shouldn’t continue to invest in the research. Lets see what breakthroughs could happen – goodness knows, the world is going to need some game-changers, but in lil old New Zealand, lets not put all our eggs in that basket yet.
The figures tabled by John Polkinghorne very clearly illustrate where we are economically vulnerable and the ways to resolve this are relatively straight-forward, if we as a nation can step above the politics….The recent government announcements on the CRL suggest we can (even if by small degrees at a time).
@Goosoid AS4343 and AS/NZS 4041 are Australian (AS) and New Zealand (NZ) standards for containers used in storage, presumably hazardous (I didn’t look them up). YOu don’t need to be much of an expert to quote this. It would be like me referring to petrol as EN228 and Diesel as EN590, it may sound big and clever but why not just say ‘petrol’ and ‘diesel’ so everyone knows what is being discussed. The tragedy is that people like MFD scoff at people that try and promote and educate about new and exciting technology that can be genuine game changers for society. I work in oil trading, you would think I would be the last person to welcome a technology that could make fossil transport fuels redundant but I cant wait for this to be rolled out to Joe public. John Polkinghorne made very good points in his post that started this thread, NZ need to solve the balance of payments problem caused through dependence on imported fuels. We should all be excited about Cellas technology breakthroughs as NZ has plenty of sunlight to provide the free energy needed to make Hydrogen the clean burning locally produced nirvana fuel NZ so desperately needs.
Phil, you are wrong. Cella energy stores hydrides which are reacted off to give hydrogen. It would be equivalent to having a tablet of table salt and reacting the chlorine out (sort of) It is absolutely not “liquid Hydrogen” like you said.
OK, so it’s technically not “liquid hydrogen at ambient temperature and pressure”, although it may actually do a better job than that would anyway. Sounds interesting. Phil, do you have any figures on what its energy density is?
Cella’s materials are already performing at 6wt% weight percentage of hydrogen, but Cella is now working with complex hydrides that store hydrogen at up to 20wt%. These exceed the revised 2009 Department of Energy targets to produce hydrogen storage materials that would compete with gasoline. Current DoE targets are 4.5%
Deriving the net figure as imports minus exports may not be that useful without knowing ownership of said oil. Just because the oil is geographically located in NZ doesn’t mean we have a net $6.3bn net deficit. If all the exported oil is owned by international oil companies, then we aren’t any better off, save for royalties extracted. Are the GDP figures for oil available?
Hey Cam, you’re right about oil rigs owned by overseas oil companies not necessarily keeping much of the profits in NZ, although I expect you mean the GNP figures. That’s worth another post and maybe I can put one together sometime.
“New Zealand as a country is heavily in debt”…
Actually, we only carry the equivalent of 26% of our GDP in debt. This compares favourably with Canda (34%), the UK (82%), and the US (107%).
Countries can run constant current account deficits if their economies grow; the money funds infrastructure and supports a stable society, and is an investment in future increased earnings. It is utterly false to present our debt level as anything close to heavy.
Government debt is relatively low, but if we include privately held debt.. here’s wikipedia’s presentation of the stats..
“At 31 June 2012, gross foreign debt was NZ$256.4 billion, or 125.3% of GDP.. At 31 March 2012, net foreign debt was NZ$141.65 billion or 104.4% of GDP”
So we’re reasonably well exposed in hard currency terms.. well worth spending our NZD wisely and prudently.
Yeah, it’s the private sector where most of the debt is. It occurred to me last night that some of our capital inflows will be associated with immigration, but even so, most of the countries in our sort of position are pretty keen to reduce their deficits and cut down their debt.
We could save millions of dollars a year in oil imports if we sealed our roads with modern surfaces rather than the terrible heavy chip most are sealed with. When cycling on the backside bruising surfaces and you come to hot mix speed goes up a couple of kms for the same effort. This must translate to power needed in a motor as well. Also, the chip tears your tyres out in half the time so less imports of tyres would be necessary.
Ah but of course, chip is cheaper to lay in the short term and cheap equals good as they say!!!
“The tragedy is that people like MFD scoff at people that try and promote and educate about new and exciting technology that can be genuine game changers for society”
No Phil, the tragedy (if that is the appropriate word) is how you believe that you are “educating” when you (understandably) have a poor grip on the technology yourself.
Since you ask, I am an engineer with 34 years of post-grad experience, 23 of which were with a major oil company working on development and design of renewable energy in the UK, US, India and South Africa. These days I regularly (but not exclusively) work on the design of industrial and process gas systems for which a knowledge of safety issues and the way in which they are mitigated is essential.
During my time in the US and the UK I worked on a number of government-funded development projects including a collaboration with ZSW in Germany:
http://www.aer-gas.de/index.php?l=A&m=A who specialise in hydrogen research.
Most (but not all) of those projects were (in my experience) a big waste of taxpayer money. The idea that we should somehow be in awe of a company that has obtained government development money is just unwarranted. I am also unimpressed by a development company’s own claims. They invariably paint a very rosy picture so as to attract further venture capital.
I am still trying to figure out why you are so “excited” about hydrogen as a fuel or why you want to promote it when it is just so inefficient compared to the EV route. You seemed to be dubious re the ability of NZ to generate sufficient electricity for EVs; where’s all the electricity for your hydrogen going to come from? You are going to need a whole lot more than to do the same task with EVs.
I am still trying to figure out why you are so excited about Cellaenergy when they are clearly resorting to puffery with statements such as :
Storing hydrogen up to now has required either high pressure storage cylinders at up to 700 times atmospheric pressure (700 bar or 10,000 psi) or super-cooled liquids at -253°C (-423°F).
Clearly false as you can readily buy hydrogen stored as hydrides:
http://www.hydrogencomponents.com/hydride.html
And hydride storage vessels:
http://www.pragma-industries.com/products/hydrogen-storage/
Wow good answer.
Phil = pwned?
Phil = owned.
Phil also does not know what he’s talking about when it comes to wind energy. There’s a pattern emerging here …
But pwned is better – http://www.urbandictionary.com/define.php?term=pwned
You obviously arent up with jargon of the kids Stu! 🙂
MFD, if you are an engineer who has worked on H research then you should know that it is easy to strip Hydrogen and turn it into a carrier of energy. Solar power is perfect for this as its free and abundant in NZ.
Id be interested what renewable energy project you worked on for an oil major in the UK and US?
Just because something doesn’t fit your opinion doesn’t make it fantasy MFD.
I’m a little confused here… why do you keep talking about solar, Phil? It hasn’t proven itself economic here as a means of generating electricity yet, which is why it hasn’t been built. Does sunlight play some kind of catalytic role in the production of hydrogen that I’m missing?
I love solar (and wind for that matter, or perhaps any renewable way of getting electricity with a minimum of carbon). I do think it has a future here (as with wind, and I’m intrigued with the pump / storage solution further up the page). We also have a huge percentage (in global terms) of renewable electricity production right now (70% – 75%?). In saying that, I don’t think we should be squandering this resource on single occupant motor vehicles, certainly not subsidising the resource to do so.
Hydrogen is like electricity, its a conveyor of energy so you need electricity to make the Hydrogen. If you use fossil fuel to generate the Hydrogen then the exercise becomes a bit pointless. However there is hydrogen everywhere so if you use solar as the source of the electricity and strip the Hydrogen from something fast growing like kelp or algae you get pretty close to zero carbon fuel production.
Now I am not a scientist (and nor is MFD) but I believe if the Govt were to invest in this technology it is an investment that pays off massively in the future. I mean, why not add 1c a litre to fuel prices and spend that on hydrogen investment?
Why would you use electricity to “strip the Hydrogen from something fast growing like kelp or algae” when you can get it from water using off-the-shelf equipment?
Why do you “believe” that investing in “this” technology is an investment that pays off massively? What IRR what constitute “massive”?
Do you have some form of discounted cashflow analysis based on costs and benefits and their timings to share or is this some sort of “faith-based” investment?
What exactly would the 1c per litre be spent on and what are the expected outcomes?
Liquid hydrogen at 1 atmosphere and ambient temperature is fantasy, Phil. It’s due to the physical properties of hydrogen and is not a matter of opinion. It’s clear that Celleenergy are not claiming to produce such hydrogen so let’s move on from that, shall we?
Any engineering solution that uses the words “easy”, “perfect” and “free” in the description is to be regarded with the utmost scepticism.
Yes, you can readily buy an electrolysis unit, connect it up and start making hydrogen:
http://www.global-hydrogen-bus-platform.com/Technology/HydrogenProduction/electrolysis
Note the conversion efficiency of 65%
Now, Phil, in order for us to get excited about hydrogen replacing NZ’s oil imports can I get you to do some calculations as to:
the volume of clean fresh water required at each of the PV generating sites and the cost to get it there
the area of PV required and its cost (contrary to your assertion, it is not free)
the cost of the land for the PV systems (it will need to be close to the water supply)
The cost of storing the hydrogen that is produced and some indication as to the method
The cost of of distributing the hydrogen to the retail sites and some indication as to the method
The engineering costs for the whole project
The overall PV to wheel energy efficiency of your proposed system
A calculation of the equivalent costs for a battery EV equivalent system
the calculations don’t have to be very accurate +/- 25% will be fine. Don’t forget that PV generation is lower in winter so you will have to give consideration as to whether you oversize the PV or try and store summer surplus of H2 for winter use.
Oh…you’ll need a cost and volume for that Cellaenergy product as well…and a cost for the vehicles themselves.
A breakdown of imported vs local for the whole project would be useful too, since we are looking at import substitution.
Thanks
Need more time, Phil? Surely you have done some calculations since you think this is a great investment, worthy of a 1c tax on fuel? I’m really keen to understand whether your enthusiastic support is based on some sort of quantitative analysis or if it is just wishful thinking.
Can we make this about data and the interpretation thereof, rather than individuals…please?
Yeah you are right – your answer above was just so awesome that I couldnt help myself. But yes you are 100% right. Apologies for any offence Phil – it isnt about individuals.
Juts on what we should use our wind/solar for – it seems a major problem is the storage of energy from those sources when the power isnt needed on the grid. To see one great solution try Googling (i couldnt find a good link sorry and I dont know how to insert PDFs):
Storage_for_a_secure_Power_Supply_from_Wind_and_Sun.pdf
I have been thinking about this myself and it is good to see that it is a viable option. Looks like it creates a very nice recreation area as well.