Canadian company launches bio-DME project in British Columbia, Canada

WWW.BLUEFUELENERGY.COM: GV Energy of Calgary, Alberta has launched its project to use the vast forests of British Columbia to produce DME. A November 30 media release announced the signing of a MOU with the City of Terrace, British Columbia to acquire land for a bio-refinery plant, and a subsequent December 17 CBC News article generated interest in the project amongst renewable energy writers around the world. The fact that two companies are now planning to use different feedstocks to produce DME in the same jurisdiction in North America bodes well for adoption of this emerging alternative fuel on the continent.

Alberta Carbon Trunk Line project

WWW.BLUEFUELENERGY.COM: Capturing and transporting CO2 by pipeline is fundamental to Blue Fuel Energy’s plan to produce carbon-neutral DME/Blue Fuel in British Columbia. Recent announcements about Enhance Energy’s Alberta Carbon Trunk Line (ACTL) project, and support for it by the governments of Alberta (C$495m) and Canada (C$63m, from the Clean Energy Fund) have certainly caught our attention, even though the CO2 is slated for Enhanced Oil Recovery (EOR) and not the production of alternative fuels.

As regards the link between the ACTL and the production of DME/Blue Fuel, the key points are that the technologies for large-scale carbon capture and the pipelining of CO2 are ready to roll—and that energy companies that clearly understand that a carbon-constrained future is fast approaching have an opportunity to utilize recycled CO2 to produce an emerging carbon-neutral fuel that will have a significant role in mitigating climate change, enhancing air quality, and providing energy security in countries around the world.

Government of Canada funds carbon capture projects

BLUEFUELENERGY.COM: Fundamental to the production of Blue Fuel using renewables and waste carbon dioxide is the capturing of waste carbon dioxide from the flue gases of various industrial operations. For Blue Fuel Energy and other companies in Canada considering doing just this, a recent announcement by the Government of Canada that it will contribute funding to eight carbon capture projects is a most positive development.

Helijet joins Pacific Carbon Trust and goes carbon-neutral

BLUEFUELENERGY.COM: Being based in British Columbia, Canada, we at Blue Fuel Energy take particular pride in sharing local news that we feel has a global impact for the environment. This is just such a story.

The Climate Action Plan was initiated by the Government of British Columbia in 2007. This plan lays out a framework that will help the province achieve 73% of its goal of reducing greenhouse gas emissions by 33% by 2020.

Pacific Carbon Trust was subsequently created as a Crown corporation in 2008 by the Government of British Columbia as a part of the Climate Action Plan. The goal of Pacific Carbon Trust is to facilitate the provision of carbon offsets to help the public sector attain its goal of becoming carbon neutral by 2010 and to aid British Columbia companies in meeting their carbon reduction goals.

Helijet International Inc. is North America's largest scheduled helicopter service and they have become the first private-sector customer of Pacific Carbon Trust. They will pay $1.37 to the trust for every passenger ticket sold. In this way they will offset 4000 metric tonnes of greenhouse gases for a total cost of approximately $100,000 annually, based on the trust's price of $25 per tonne of carbon dioxide equivalent removed or reduced from the atmosphere. For more details, visit: http://www.helijet.com/

We congratulate Helijet for making this bold step. And we thank the Government of British Columbia for having the foresight to set up Pacific Carbon Trust. For not only does the trust allow companies like Helijet to go carbon-neutral, it will use the funds it receives from companies like Helijet to help finance projects in British Columbia that produce renewable energy, that conserve energy and that capture or store carbon from the atmosphere, according to the B.C. Minister of the Environment Barry Penner.

And of course we see an opportunity for companies like Blue Fuel Energy and other renewable energy companies in British Columbia to provide the carbon offsets that companies like Helijet will be purchasing to help propel British Columbia into a global leadership role in the offset industry.

For more information, visit: www.pacificcarbontrust.ca

Legislation authorizes carbon capture and storage funding

$2 billion will help fund three to five large-scale projects

BLUEFUELENERGY.COM: The Government of Alberta has introduced new legislation that provides the legal authority to administer the $2 billion in provincial funding for carbon capture and storage (CCS) announced by Premier Ed Stelmach in July 2008.

“The Government of Alberta is investing in the science of solutions,” said Energy Minister Mel Knight. “This new bill demonstrates the Government of Alberta’s commitment to its goal of clean energy production. We expect the carbon capture and storage projects built with these funds will reduce CO2 emissions by five million tonnes annually by 2015.”

The Carbon Capture and Storage Funding Act, Bill 14, will enable the province to administer funding to support three to five large-scale carbon capture and storage projects. Companies vying for the funding are completing full project proposals, which will be submitted to government by March 31. The selected projects will be announced by June 30.

“Alberta is a small contributor to global greenhouse gas emissions but as we develop CCS technology that can be shared with the world, we can make a significant contribution to the climate change solution,” said Knight.

While some carbon capture projects around the world face serious challenges, particularly due to the falling price of carbon credits, this initiative by the Government of Alberta is another reminder that carbon capture is alive and well in western Canada. Carbon capture is fundamental to Blue Fuel Energy’s plans to use renewable energy to produce carbon-neutral Blue Fuel in BC’s Peace River region—just across the border from Alberta’s upcoming carbon capture projects.

Grid gridlock

BLUEFUELENERGY.COM: It’s blatantly obvious that in order to incorporate renewable energy into the North American energy mix on a meaningful level we’re going to have to significantly expand and upgrade electrical grids. Presently, grids are archaic, fragmented, and not very “intelligent”. Politicians throughout the land are aboard the bandwagon on this one, beating the drum for all they’re worth. And why not? Unfortunately, it’s going to take a lot longer, and cost a lot more, than we all would like to admit.

Here in British Columbia, BC Transmission Corporation (BCTC) made a presentation on January 7, 2009 outlining their vision of how BC’s grid expansion should proceed. The presentation highlighted a few “challenges” presented by BANANAs (Build Absolutely Nothing Anywhere Near Anything) and NIMBYs (Not In My Back Yard) revealed by a survey conducted by Innovative Research Group Inc. :

70% of respondents agree that new industrial developments should be built as far away from existing neighborhoods as possible.

47% of respondents agree that they like their neighborhood the way it is, and that they don’t want any new development.

Data has been redacted, but in general it shows that hydro generation receives the highest level of support and HV transmission lines less support than nuclear-generated electricity . . . among traditional power projects, nuclear is viewed as the most dangerous, with HV transmission lines a close second.

Major transmission projects take 2-3 times longer to build than new
generation – early regulatory approval of future projects is critical to ensure transmission needs of the province are met.

Subsequent to this presentation, a February 18 Marketwire report outlined how a BC Court of Appeal ruled that BC Hydro and BCTC’s proposed $700 HV transmission line from the interior of BC to the Vancouver area cannot proceed until First Nations are properly consulted and accommodated for infringements to their aboriginal title and rights.

A February 12 Economist.com report highlighted the fact that grid upgrades are equally problematic in the US, and that there is a big divide between environmentalists who are focused on greenhouse gas emissions and those who worry about harm to natural habitats, whether caused by global warming or anything else.

The upshot is that, as we work to overcome the obstacles to grid expansion and upgrades, we also need to pursue other ways of incorporating renewable energy into the energy mix. From the perspective of Blue Fuel Energy, the most obvious way of doing this is to convert renewables to a liquid fuel that can carry this energy to load centers without the grid—which explains why we call Blue Fuel “liquid electricity.”

Natural gas vehicles in BC

BLUEFUELENERGY.COM: The BC Government appears to be seeking homegrown solutions to the issues of climate change, energy security, and air quality. As Black Press reporter Tom Fletcher noted in a February 22 article, BC’s minister of the environment, Barry Penner, has been testing a Honda Civic powered by natural gas, imported from the US for demonstration purposes.

A couple of key points in the article are as follows:

Honda boasts that its natural gas Civic has the cleanest internal combustion engine in the world, with 50 to 80 per cent lower nitrogen and sulphur oxide emissions and 25 per cent less carbon dioxide than its gasoline version. The greenhouse gas edge is partly due to natural gas being relatively simple to process.

Not to make too fine a point, but it’s necessary to note that Honda may boast the cleanest “commercially available” internal combustion engine in the world. Although the natural gas-powered Civic clearly has significantly lower emissions than a comparable gasoline-powered car, a comparable Blue Fuel-powered car—especially one burning Blue Fuel produced with renewable energy, water, and waste carbon dioxide—would have significantly lower emissions than the natural gas car. This is particularly true with carbon dioxide: the Blue Fuel vehicle’s net carbon dioxide emissions would only be those generated to transport the fuel to market.

Penner is responsible for B.C.’s ambitious plan to slash greenhouse gas emissions, about 40 per cent of which come from vehicles. The government’s recent throne speech highlighted the benefits of natural gas, which has surged in importance as new drilling technology has spurred a shale gas rush in the northeast of the province.

The B.C. government estimates that the Montney Basin near Dawson Creek and the Horn River Basin northeast of Fort Nelson have as much as 69 trillion cubic feet of recoverable gas. “That could yield over $37 billion in provincial royalty revenue . . .and the Bowser and Nechako Basin in the Central Interior and offshore gas also have “significant long-term potential.”

The BC Government will be hard pressed to turn its back on natural gas revenues. It should be noted, however, that there are two realities that, in the years ahead, may impact demand for natural gas as a transportation fuel. First, BC may be required to implement severe cuts to greenhouse gas emissions to comply with regional, national, or international regulations. As noted above, though natural gas is better than gasoline and diesel with regards to carbon dioxide emissions, its emissions are still well beyond what the world is going to need to get back to a safe upper limit of 350 ppm of carbon dioxide in the atmosphere. Second, natural gas prices are historically volatile. There is every reason to expect that there will be future spikes in the price of natural gas. On the other hand, Blue Fuel produced with renewables offers price stability over long periods because the only significant production cost is the cost of capital, which falls over time.

Canada: the Saudi Arabia of wind

BLUEFUELENERGY.COM: On February 19, with President Barack Obama in Canada on his first foreign trip since assuming the presidency, Terry Tamminen , advisor to the president’s transition team and a long-time environmental advisor to California Governor Arnold Schwarzenegger, was interviewed by CBC radio’s Anna-Maria Tremonti on The Current . The focus of the conversation was how the president’s new energy policies might impact Canada. Canada is by far the largest supplier of oil to the US, and a considerable amount of Canada’s oil exports to its southern neighbor is “dirty oil” from Alberta’s oil sands projects. Given the president’s ambitions to wean the US from its addiction to oil and convert the nation to clean energy, Tremonti asked whether Canada will continue to be a major supplier of energy to the world’s largest energy consumer. Tamminen’s answers were insightful.

According to Tamminen, Canada will indeed continue to be the largest source of energy for the US, and in the short- and medium term, demand for Canadian oil will remain strong because of the incredible number of gasoline and diesel vehicles on US roads. These vehicles will not be replaced overnight. Further, as the US starts using less oil, the first sources that the US will drift away from will be those in the Middle East, which are hugely expensive to secure. Although gasoline and diesel are not now expensive at the pumps, the US government is spending obscene amounts of money to maintain a strong presence in the region and keep the shipping lanes free. When military expenditures required to keep the oil flowing from the Middle East are factored into its cost, oil is not so cheap.

As the US moves away from oil, demand for clean energy will burgeon. And as Tamminen notes, there will be no silver bullet—only silver buckshot. The energy will come in many forms and the competition will be intense. As Tamminen sees it, Canada has the potential to become a huge exporter of renewable energy to the US—to become the Saudi Arabia of wind. This is an alluring concept, but two things need to happen for Canada to fully capitalize on its renewables. First, the grid must be greatly expanded and made more “intelligent”; and second, other mediums for transmitting renewable energy from remote regions where high-voltage transmission lines are either too expensive or politically problematic to build must be incorporated into the picture. Given that Blue Fuel/DME can be produced economically and efficiently in Canada with renewables, can carry electrical energy long distances safely and economically using existing infrastructure (pipelines, trains, ships, and trucks) and can burn ultra-clean in diesel engines with only minor modification to the fuel system, logic suggests that a large niche in the US market should develop for this emerging fuel. Time will tell. Blue Fuel needs strong advocates to establish a foothold in the marketplace. Perhaps someone like Terry Tamminen, who has promoted California’s Hydrogen Highway and is an advisor to two of the most progressive and powerful politicians in the US, could be the “difference maker” for Blue Fuel/DME. We await his return call . . .

BC focuses on clean energy

BLUEFUELENERGY.COM: On February 16 British Columbia's lieutenant-governor delivered the throne speech on behalf of the BC Government, led by Liberal Premier Gordon Campbell. The throne speech precedes each new session of the legislature and outlines the government's agenda for the upcoming year. Based on the content of this year's speech, businesses and other organizations promoting the production of Blue Fuel/DME in BC with renewable energy and waste carbon dioxide have every reason feel optimistic. Some of the highlights of the speech that pertain to Blue Fuel are as follows:

Through the Western Climate Initiative and the Climate Registry, we are helping to lead a continental response to global warming that will shape our economic and environmental future. The WCI cap and trade system will reduce regional greenhouse gas emissions and drive new sustainable growth. We are leading the establishment of a new Pacific Coast Collaborative with California, Oregon, Washington and Alaska. In March, a first Annual Leaders' Forum in California will launch a new vision for sustainable regional growth focused on clean energy . . .

The BC Government is committed by legislation to reducing greenhouse gas emissions 33% by 2020, and fully understands that by producing low-carbon or carbon-neutral fuels, such as Blue Fuel, it will not only achieve this goal, but have a valuable commodity for the WCI cap and trade system. Further, strengthening BC's relationship with huge markets south of the border will generate opportunities to establish customers for Blue Fuel. This is particularly true of California, which has stringent regulations for reducing greenhouse gas emissions and enhancing air quality. Carbon-neutral Blue Fuel is a solution to both of these problems.

Energy is another core competitive advantage for British Columbia. BC is a low-carbon energy powerhouse. New technologies and the global hunger for clean, low-carbon energy and new sources of traditional energy are putting B.C. in the driver's seat. Even with our commitment to meet 50 per cent of B.C.'s future electricity needs through conservation, more power will be needed to ensure we are electricity self-sufficient by 2016. Electric plug-in vehicles and other technologies aimed at reducing fossil fuel dependency will place new demands on our electricity system. We can meet those demands and create jobs and opportunities for our citizens . . . We can become global leaders in wind, run-of-river, tidal, geothermal, wave, solar and other forms of clean, renewable power . . .

The BC Government now fully recognizes the incredible renewable energy resource base that BC possesses. This was not the case as recently as five years ago, remarkable as that might seem. Five years ago the government was far from fully apprised of the incredible world-class wind resources we have in the northeast, dubbed in the throne speech BC's Northern Energy Corridor. Today it is, which is why wind is the first form of renewable energy listed in the speech. The government is poised to make these hitherto exotic energy streams mainstream.

Despite the current recession that has caused numerous energy-intensive industries in BC to shut down and short-term demand for electricity to fall, the government recognizes that not only does BC need to produce more electricity to become electricity self-sufficient, but that there is a global hunger for clean, low-carbon energy. The government envisages selling clean BC energy to external markets. But selling electricity to external markets is highly problematic because of grid constraints—unless it is converted a liquid fuel. Enter Blue Fuel, which can carry electrical energy efficiently and safely over long distances by pipeline, train—and ship. Which brings us to the following section of the speech:

New investments will be made in carbon sequestration technology. With that policy framework in mind, BC will make the most of its remarkable wealth of natural gas. We can build on our potential to ship clean, liquid natural gas to Asia that will reduce its growing dependency on coal power and dramatically cut greenhouse gases.

Carbon sequestration . . . A wealth of natural gas . . . Shipping liquid natural gas (LNG) to Asia . . . Carbon-neutral Blue Fuel . . . Think of these four phrases as pieces of a jigsaw puzzle and try putting them together. A fascinating image emerges.

Let’s start with the natural gas. The BC Government is talking about 960 billion cubic ft of natural gas production in BC per year. That is a staggering amount of natural gas—and an equally staggering amount of carbon dioxide.

Natural gas processor Spectra Energy is already the leading emitter of carbon dioxide in the province. With the ramping up of natural gas production, CO2 emissions from natural gas processing facilities will soar—threatening the government's goal of reducing carbon dioxide emissions by 33%—unless those emissions are sequestered.

Spectra Energy and the BC Government are jointly funding research into what could become world's largest carbon capture and sequestration projects—in BC's Northern Energy Corridor. At present, sequestering carbon is both experimental and expensive. Enter Blue Fuel—again.

Two questions arise: First, why pump the carbon dioxide from natural gas processing in BC into the ground? After all, the process is risky and expensive, and the CO2 can be used to produce an ultra-clean burning fuel. Second, can using the carbon dioxide to produce Blue Fuel be considered a form of sequestration? (“Sequestration Light”, perhaps?) Given that the Blue Fuel derived from the CO2 could supplant coal for power generation, diesel for transportation, and propane for heating and cooking an argument can be made that it comes pretty close. With its ambitious CO2 reduction targets, we have every reason to believe that the government will consider the conversion of CO2 captured from natural gas processing plants into a Blue Fuel feedstock as a form of sequestration and thus help Blue Fuel producers establish markets and commence production.

This brings us to the issue of liquefying natural gas and shipping it to Asia. No question that this can be done, especially since the port of Prince Rupert, just south of the Alaska border, is the closest major port in North America to Asia. But not only can BC ship LNG to Asia, it can also ship Blue Fuel. In fact, shipping Blue Fuel to Asia is far less problematic than shipping LNG, which requires expensive, specially designed cryogenic storage tanks and ships. Shipping Blue Fuel on LPG-type vessels can be done much more economically than shipping LNG.

The goal of a Northeast Transmission Line will be pursued.

This little item in the speech has huge ramifications for the production of Blue Fuel with renewables in BC, particularly wind. The proposed line will be in close proximity to the hundreds of kilometers of world-class wind park sites on ridges that parallel the Rocky Mountains in northeastern BC. Conveniently, these wind park sites are not far from the huge natural gas fields that the government envisages exploiting. Electricity generated at these wind parks can be used to both power the natural gas processing facilities and produce Blue Fuel—using carbon dioxide captured from natural gas processing. Energy synergy at its finest . . .

Blue Fuel for cleaner air and healthier, longer lives

BLUEFUELENERGY.COM: Almost all of us want to live healthier, longer lives. But as a recent Los Angeles Times article indicates, by breathing in air with excessive concentrations of particulate matter, which billions of us do every day, we are not realizing our potential to do so. This is both tragic and costly, especially given that Blue Fuel is a solution to this problem—a solution waiting to be tapped. And the most obvious and immediate way that Blue Fuel can be used to significantly improve air quality is as replacement for natural gas for power generation because it can be used without the need to modify turbines or combustors and manufacturers such as Mitsubishi, Hitachi, and General Electric have all approved it for their gas turbines.

Here in British Columbia our crown-owned utility, BC Hydro, operates three natural gas-fired power plants. The largest of these, Burrard Thermal Power Station, is a 950 MW plant that provides back-up for the hydroelectric system during low-water years, and supplementary power at peak demand periods and during interruptions in the grid. It could also be run steadily during periods when natural gas prices are relatively low, as they presently are, but this would cause a huge increase in GHG emissions and other types of health- and life-threatening pollution. As Dr. David Suzuki of the Suzuki Foundation notes:

“The US Environmental Protection Agency estimates that 77 percent of particulates from natural gas plants are dangerously small. These fine particulates have the greatest impact on human health because they bypass our bodies’ natural respiratory filters and end up deep in the lungs. In fact, many studies have found no safe limit for exposure to the substances.”

Despite this, there are initiatives to restore Burrard Thermal to full capacity, which according to BC Citizens for Green Energy, would be an environmental obscenity both because of the GHG and fine particulate emissions. The message that Blue Fuel can improve health and save lives—and save society countless millions of dollars by enhancing productivity and minimizing medical costs—needs to be vigorously promoted to utilities and government and non-government organizations charged with the task of improving air quality. Switching from natural gas to Blue Fuel is the low-hanging fruit for proponents of Blue Fuel—and we all know the health benefits of eating fruit.