Where Have All the BTUs Gone?

I have been away for a few weeks at conferences and have chatted to all sorts of different experts about energy issues. However, during my time away I have been nagged by an important open question. In my last post, I stated that I don't consider the 25% renewables by 2025 goal to be an achievable one, and I presented data that showed that whatever progress we have made over the past few years has been as a result of energy usage reductions rather than increased amounts of renewable energy. Regardless of my viewpoint on the achievability of the goal, these energy savings are great as I believe we can accomplish more through energy savings than we can from new renewable energy sources. Nevertheless it is critical to understand what we are doing to save energy so we can do more of the same. So to paraphrase the words of the old Pete Seeger song "Where Have all the Flowers Gone," I want to know "Where Have All the BTU's Gone?" 

In-state energy use in NH has decreased by 9% since 2005 - see my last post. Some possible reasons include: 

 

• The Great Recession of 2008/2009 resulted in lower economic output and therefore less energy consumption.
• Increased fuel costs have caused us to moderate our energy-consuming habits.
• Through various State, Federal and privately funded energy savings programs, we are becoming more energy efficient, and we are able to accomplish more with less energy input.
• We have a smaller population and therefore fewer of us in NH are using energy.

Let's dispense with the last point first. From 2000 to 2010, the NH population grew from 1.24 million to 1.32 million – a 6% increase. So not only are we using less energy – we are using less energy while the State population is growing. Because census data are only collected on a per decade basis, it is useful to look at energy usage on a similar basis, so let's take a look at energy consumption since 2000, shown in the chart below.

The blue bars show that in the first half of the decade (except for the post 9-11 economic downturn in 2001), there was a continuation of our decades' long run up of energy consumption. In fact, from 1990 to 2000 our energy consumption increased 16%. We reached a peak of in-state consumption of 331 trillion BTU in 2004. Since then energy consumption has turned around and had dropped off 11% by 2010. I have overlaid data for the NH Gross Domestic Product (GDP) as the red line, and, except for the post 9-11 slow down in 2001 and a dip for the 2008/2009 Great Recession, the decade saw a 14% increase in GDP. So our decrease in energy consumption preceded the Great Recession by a number of years. There is no doubt the recession did encourage further energy savings as we, like Jimmy Carter, turned down the thermostats, took to wearing more sweaters and sat closer to the fire.

Dividing energy consumption by GDP dollars yields a number called GDP energy intensity, which is a measure of the amount of energy, in BTUs, it takes to produce a dollar of GDP output. In the table below you can see our energy intensity for some key years and how it has changed since 1990.

Our decrease in energy intensity is clear and this mirrors a long-term decrease for the whole US. In fact, in NH our energy intensity is typically 30% lower than the USA average. Generally speaking, our energy intensity has decreased and we are able to produce more GDP output with smaller energy outlays. This comes from an increasing awareness of the energy components of our industrial output as well as our move away from energy-intensive industries such as mining, steelmaking and general heavy manufacturing.

Another energy intensity measure that is often calculated is energy use per person. These numbers for NH and the USA are shown below.

 

Here we see an increase in per capita consumption to 2004 and then a 12.5% drop off from 2004 to 2010. Again our per capita consumption is, on average, about 30% lower than that of the US total. In fact, on a state basis, NH is way down the list in per capita energy use – we are at position 44. Rhode Island and New York, which have the lowest use of energy per person, have per capita values 15% lower than ours. On the other hand, states like Alaska and Wyoming have usages three times greater than ours.

So our energy usage has declined and is lower than the US average, but it still begs the question – "Why?". To get a better view of the decrease, I have looked at the four main components of our in-state energy consumption, viz., transportation, commercial, residential and industrial use and how they have changed since 2004. I have plotted the data for 2004 and 2010 for each of the sectors in the chart below.

 

 

 

In 2004 our energy usage was 331 trillion BTU and in 2010 it was 296 trillion BTU – a 35 trillion BTU decrease. This is an 11% decrease in our in-state energy consumption. Transportation usage only decreased by 2%, commercial use declined by 12%, residential usage decreased 10%, and industrial usage dropped by 27%.

The pie chart below shows which sectors contributed the most to the 35 trillion BTUs savings. Most of the decrease came from the industrial sector which contributed 40% of the savings, next was the commercial sector which provided 33% of the savings, followed by residences with 20% and a small portion by reduced transportation usage. I note that another blogger on NH issues, Brian Gottlob at Trendlines, has done a similar analysis. (In fact, I subscribe to the Trendlines Blog and I always find his data-based take on NH economic issues interesting. I encourage you to do the same.)
 

So where does the impressive decrease in industrial energy consumption come from? Contrary to what many folks think, this is not due to erosion of our manufacturing base. In fact, NH's manufacturing base has held up well over the past decade. On average, we get 15% of our state GDP from manufacturing, compared to 12% for a US average and based on some recent data we are even seeing an increase. What is different is that our manufacturing is changing – it is no longer the heavy manufacturing of years gone by, and, based on discussions with manufacturers, I know that energy is now a top-five expense in most manufacturing companies. Companies have invested in many projects to reduce energy costs and, as a result, manufacturing is now more energy efficient than ever before.

 

To get a better sense of the industrial energy usage in the state, I have extracted the energy used in industrial activities as well as the industrial GDP component to calculate the industrial energy intensity. This data are shown in the table below and I have included the data for the US as a whole as well. 

The key point to note is that industrial energy intensity has decreased over the past decade for both NH and the US, however there was an impressive decrease in NH industrial intensity from 2004 to 2010. This was an almost 50% significant decline in the State's industrial intensity since 2004. I don't have a ready explanation for this decrease but it is surprising and warrants further review and continued tracking.

As usual, I have flooded you with data, charts and information and there is a lot more I could ply you with. At this time I have to leave you with only a partial understanding of why we have been able to reduce energy usage in New Hampshire. There is more to this picture and I too need to better understand why we have been able to decrease energy usage in New Hampshire since 2004 even though economic output, measured by GDP, has increased. I plan to do some more research and I will share my findings with you over the course of the next few months. Nevertheless, this is what we know so far:

• Our energy intensity on a per capita and a per GDP dollar basis has decreased steadily and our numbers are amongst the lowest in the USA.
• Most of our energy savings have come from reductions in industry energy usage and from commercial applications.
• The industrial energy intensity has been reduced by almost 50% since 2004.

What do you know and what can you contribute to this discussion? Feel free to leave a comment or send me an email.

Until next time, remember to turn off those lights when you leave the room.

Mike Mooiman
Franklin Pierce University
mooimanm@franklinpierce.edu
3/5/2013

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The 25 by ’25 Renewable Energy Initiative for New Hampshire – Can We Do It? - Part 1

With a new governor in place, I have been giving some thought to the initiative enacted by Governor Lynch in 2007 that New Hampshire should aim to get 25% of its energy from renewable resources by 2025 – the so-called 25 x '25 initiative. With my recent posts on renewable sources and their contribution to the NH energy supply, I was wondering how we are doing and if we are making progress towards the 25 x '25 goal. Until a few years ago, the New Hampshire Office of Energy and Planning, OEP, had been calculating and recording our progress, but they have not updated their information in a while. The last available numbers were for 2008 so in the next few posts I will be presenting updates of the OEP numbers and will be taking a closer look at the feasibility of the 25 x '25 goal and what it will take to achieve it.  

The goal is 25% renewable energy by 2025 but we need to start off by asking the question: "25% of what?" According to the OEP, the "what" is net energy usage. Net energy use refers to the energy we use in-state and excludes that associated with any energy exports. In our case, we export 51% of our produced electricity, so we need to subtract the energy used to produce this exported electricity from the gross, or overall, energy usage by NH to generate the net energy number.

All my blog posts and previous calculations, to this point, have referred to overall energy use by New Hampshire, so for net energy usage we need to reduce the 409 trillion BTU overall usage by the 113 trillion BTU used to produce exported electricity, leaving us with a new number: 296 trillion BTU. This is our net energy usage for New Hampshire for 2010 and will be the basis for the calculations and discussion for the next few blogs.

With the net in-state energy usage in hand and using the renewable energy numbers from previous blogs, we should be ready to calculate the percentage of renewable energy. Ah, if only it were so straightforward. Instead, we now face an intriguing dilemma: this revolves around how we look at that exported energy (electricity exports plus the energy waste associated with its production). The electricity produced in NH comes from renewable and non-renewable sources and even though the electrons involved in electricity flow from these sources are indistinguishable, we can view our produced electricity as a blend of green electrons (those from renewable energy) and brown electrons (those from fossil fuels and nuclear). So, when we export electricity are we exporting just brown electrons or a blend of green and brown electrons? As I have noted the electrons are indistinguishable, so we are, in essence, just playing an accounting game but this is an important game with important consequences. If we take the position that exported electricity is indeed a blend of green and brown electrons then we need a commensurate reduction in the amount of renewable energy we can claim for in-state use. Specifically: we export 51% of electricity production, so we need to reduce the renewable fraction that goes into electricity production by 51%. This significantly reduces the amount of renewable energy we can claim. On the other hand, if we take the position that we use all the green electrons in-state, then we can claim all that renewable energy that goes into electricity production.

Which is the correct answer? Well, the OEP sidesteps the issue of the correct answer by calculating the percent of renewable energy data for both scenarios. In my calculations, I adopted that same convention by performing calculations for both scenarios as well. The results of my calculations for 2010 are shown in the following table. I have used headings and formats similar to the OEP results to make for direct comparison. However, it should be noted that my methodology is a little different from that of the OEP as I have used the NH data and energy accounting approach from the Energy Information Agency, EIA, exclusively and I do not include imported electricity in accounting for renewables - even though it might be from hydroelectric operations in Canada.

At first glance, the results are not encouraging. Even if we lay claim to all the green electrons for in-state use, Option 1, we are at 14.7% renewable energy with 13 years to go. The situation is even worse if we calculate on the basis that we are exporting a blend of green and brown electrons, Option 2. In this case, we are only at 9.1% renewable energy. However, this still begs the question – which is the correct number? Well, it depends on who is playing the game and making the rules. Nevertheless, my vote is for the higher number, the one comes from grabbing all of the green electrons for ourselves. The basis of my choice that the calculation is simpler to perform, and this is an extraordinarily complex scientific reason - it is a larger number - which makes the 25% easier to achieve!

Feeling somewhat gloomy about where we presently stand, I wanted to see if we were, in fact, making progress since the 2007 start of the 25 x '25 initiative. If we were - and it was rapid progress – it would certainly be encouraging. I therefore went back a few years to calculate the percent renewable data for both options which I have presented in the chart below. I have included the earlier OEP numbers (shown as red X's) in the chart below and even though, as noted earlier, my methodology is somewhat different from that of the OEP, the agreement between the two data sets is good.

Since the start of the initiative in 2007, we have, using Option 1, gone from about 12% to almost 15% renewable energy which is commendable progress over the past 3 years. (With Option 2, we have only gone from 7.5 to 9.1% which is not as commendable and therefore, for the "complex" scientific reasons noted above, we will ignore it going forward.) At this rate – about a 1% increase per year – reaching 25% by 2025 looks achievable, which is rather encouraging. However, while we are basking in the warm glow of our collective achievement, let's take a closer look at the two sets of data that generated this chart. Specifically, let's examine net energy usage and renewable energy production in NH separately, which I have done in the bar chart below.

A closer review of this data reveals that most of the change in the renewable energy fraction has occurred as a result of the reduction in the in-state energy consumption over the past few years. We have gone from 325 trillion BTU in 2005 to 295  trillion BTU in 2010 – an impressive 9% decrease in 5 years (an annual compounded decrease of 1.9%) but, and this is rather crucial, an examination of the renewable data shows that there has been little change in the amount of renewable energy we produce in-state. As a result, we need to conclude that our progress toward the 25% renewable energy goal to date has been on the back of energy savings - and not from increased renewable energy.

Going forward, can we continue to rely on further energy savings to get us to 25% and how realistic is this? It also requires us to ask the question – where are these energy savings coming from – are they the result of a general economic slowdown in the state accelerated by the Great Recession, high energy prices, a shrinking population, the success of energy savings programs, or some other reason? This is certainly worth closer examination and I would be interested in your opinion. For the moment, and for an energy savings geek such as myself, regardless of the reason these energy reductions are positive and are certainly propelling us towards our goal. But we should stop here and ask ourselves - are they sustainable? In my next post, I will look at how net energy usage is allocated in the state and what we need to do in terms of more energy savings and/or renewable energy increases to achieve the 25 x '25 goal. It might be more difficult than we think.

 Until next time, remember to turn off those lights when you leave the room.

Mike Mooiman

Franklin Pierce University

mooimanm@franklinpierce.edu

2/10/2013

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Renewable Energy in New Hampshire – Part 1

In this week's post, I am going back to some of the early analysis I did so that we can take a closer look at renewable energy in New Hampshire. As shown in the figure below, about one-tenth of our energy supply comes from renewable energy sources. Transportation - largely ethanol in gasoline -  accounts for 12% of the renewable energy supply, heating for residential and commercial buildings uses 9%, industrial operations, 4%, and three quarters goes directly to the generation of electricity. In fact, renewables make up 15% of the energy that goes into electricity generation in the state.

 
At this stage, you might be asking yourself "What is in the renewables box?" so let us take a closer look at this. If we pop open the renewable energy box, we find the pie chart below.

 
By taking a look at the various slices of the renewable pie, we see that energy from burning wood and waste makes up just over half of the renewable energy produced in the state.

I was a little surprised at the large slice of wood and waste, and my first thought was that a lot of this energy comes from the incineration of municipal solid waste (MSW). As it turns out, I could not have been more wrong: MSW incineration is only about 2% of the renewable energy category. The bulk of the wood and waste slice is from the burning of wood and other biomass to generate electricity. It turns out that there are seven wood-burning power plants in the State and two more under construction. These wood burning plants are responsible for three quarters of the wood and waste slice (or 4% of the overall energy consumption in NH). My estimation is that 8% of the total energy input into electricity production is from wood. This is a lot larger than I anticipated and clearly fodder for a future post.
 
The remaining quarter of the wood and waste slice is from the burning of wood and wood pellets in homes and businesses. I, for one, am impressed that the Energy Information Administration, EIA, that put together all this valuable information is able to collect reliable information on firewood and wood pellet sales. A lot of these sales are to individual homeowners, only some of which are sold at retail. A good portion must be from individuals buying and selling truckloads of firewood to one another and, in many cases, even from trees on one's own property. This figure must be extraordinarily difficult to measure or estimate.

Turning back to the pie chart above, we can see that hydropower makes up about one-third of the renewables pie which goes directly into the electricity supply for the state. Corn-based ethanol, which is now part of the gasoline in our automobiles, represents 12% of our renewable energy use. How renewable this food-based energy source actually is, is debatable, but I will take another opportunity in the future to grind that particular axe. Wind is a relatively small component, only about 2% of renewable energy and driven largely by the Iberdrola wind farm in Lempster. With new wind projects underway, this portion will increase in the future. Solar thermal and photovoltaic are a minute fraction and, at this time, geothermal does not even feature in the EIA numbers. However, there are a good number of geothermal applications in the State but these tend to be small-scale residential or commercial-based installations and are thus difficult to track. It could be interesting to review this sometime in the future.

The pie chart shows where we were in 2010 regarding our renewable energy portfolio in New Hampshire. For our state it is largely a lot of wood and hydropower. Next week, in Part 2, I will be taking a look at historical trends in renewable energy and will look at where we might be going and if we should be spending so much time, effort and tax dollars supporting renewables.

 
Until next time, remember to turn off those lights when you leave the room.

Mike Mooiman

Franklin Pierce University

mooimanm@franklinpierce.edu

2/3/2013

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Another View of Statewide Energy Flows in New Hampshire

In this post I want to look at New Hampshire energy flows in a different way, without resorting, as I have in previous posts, to column charts and criss-crossing cobwebs of arrows. Instead, I would like to introduce the concept of Sankey, or flow, diagrams which are often used in the energy industry. In these diagrams the magnitude of the flow of energy is indicated by the width of the arrow. These diagrams were first used in the energy field by an Irish engineer and captain in the British army, Matthew Henry Phineas Riall Sankey in 1898 to illustrate energy flows in steam engines. A modern version of a Sankey diagram is shown in the next figure. This figure neatly shows how input energy into a steam engine is lost to smoke, friction and a large portion to the steam condensation step. The condensed water is then recirculated to be heated into steam again, hence the small recirculating flow. Useful energy as forward motion of the steam engine and a small amount going to the alternators is shown as the exiting blue flows.

The great thing about Sankey diagrams is that they are not restricted to only energy flows. They can be applied to quantities of many types. For example, material and cost flows are often depicted. One of the most famous of these flow diagrams is that prepared by the French engineer George Charles Minard in 1869, shown below. This figure illustrates the fate of Napoleon's army in 1812 -1813 as they progressed through their disastrous Russian invasion. The figure shows, by the width of the lines, the fate of the invading army. Napoleon crossed into Russian with 422,000 men and through attrition, minor skirmishes and some great battles he entered a largely abandoned Moscow with about 100,000 men under his command. He then turned back to return to France: on the way back, starvation, battles and incessant harassment by guerilla forces decimated his army to 10,000 survivors. The harsh winter also took its toll on his men - the line graph below the flow diagram shows the decreasing temperatures encountered on the army's return from Moscow. The diminishing width of the flow is a skillful, albeit rather harrowing, representation of what was happening in the army in the field, the prisoners that were taken and the lives that were lost.

But I digress. Let's return to energy flows. The folks at the Lawrence Livermore National Laboratory (LLNL) annually prepare flow diagrams for the total flow of energy in the US. These diagrams are particularly useful and informative and they appear in energy-related presentations all over the place. In 2011 LLNL prepared individual diagrams for all 50 states based on 2008 data. To the best of my knowledge, they don't update these state diagrams every year like their total US flow diagram. Nevertheless I thought I would share their 2008 diagram for New Hampshire, shown below, with you.

 

Much of this figure shows the same information as my previous analysis, but it does so in a more elegant fashion. Off to the left, you can see the energy inputs to the state. These input energies then flow into transportation, homes, offices, stores and industry and a large part of the flow goes into electricity generation. The width of the lines clearly shows the magnitude of the flows. As with my analysis, it can be seen that electricity produces a lot of waste heat and a relatively small portion, 32% according to LLNL, ends up in electricity that is directed to homes, businesses, factories or exported out of state.

What this diagram includes, which my previous analysis did not, is the recognition that a large fraction of the energy that goes into transportation is lost as waste heat rather than motion. According to the LLNL estimates, only 25% goes into motion. They also recognized that a lot of the heat that goes into warming our homes, businesses and factories is lost due to poor insulation, waste and equipment inefficiencies. Their numbers suggest that 35% of the input energy into homes is lost. For commercial operations they estimate 30% of the energy is lost and losses of 20% are encountered in industrial applications. The diagram then neatly combines all the separate waste energy flows into a single value at the right of the diagram which illustrates the rather sobering fact - that, of the 418 trillion BTU energy supply to NH, 270 trillion BTU, or 65%, is lost as waste heat!

While not as dramatic as the fate of Napoleon's army, this single sobering fact that 65% of our energy input is lost provides the best opportunity for managing our energy needs going forward. Investments in higher efficiency equipment, higher mile-per-gallon vehicles and better insulation for our buildings will all serve to reduce the amount of energy wasted. This will reduce our input requirements. Energy supplies, especially those associated with fossil fuels, can be reduced and better managed. In the process we will reduce our carbon emissions as well.

In many respects, this is the most single beneficial thing that you and I can do at present – we can and we must reduce the amount of energy we waste. Yes, alternative energy sources are necessary but, while we are waiting for scientific breakthroughs and large-scale commercial development, we can be taking measures right now to reduce our energy consumption. We as individuals can take action and we can organize to get the organizations we work for to take action. There is lots of help out there. Many companies and non-profits are working in this field and they are making a difference. For example, here in New Hampshire the very focused mission of the Jordan Institute is to reduce energy losses from buildings in the State. They are doing some impressive things to reduce our dependence on fossil fuels. Take a look at their website if you get an opportunity.

We also need to be realistic about these losses. Yes, they are large, but we will never be able to totally eliminate them due to the nature of energy, materials, electricity and the laws of physics. Even so, we are so far away from these physical limits that there is a lot we can do to reduce energy waste.

So there you have it – another way to look at energy flows in the state. Bear in mind that this analysis uses 2008 figures from the Energy Information Administration and does not reflect the rapid switch away from coal that we are presently undergoing. I plan to present an update of the energy flow diagram for NH in a future post but, in the meantime, hopefully I have got you thinking about what you can do avoid energy losses in your home and the building you work in.

Until next time, remember to turn off those lights when you leave the room.

Mike Mooiman

Franklin Pierce University

mooimanm@franklinpierce.edu

1/20/2013

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