Former president of Shell Oil calls for aggressive action on alternative fuels to break oil monopoly on transportation
30 April 2013
John Hofmeister, former President of Shell Oil Company and founder and CEO of Citizens for Affordable Energy (CFAE), is joining the Fuel Freedom Foundation (FFF) Advisory Board. Fuel Freedom is a non-partisan, non-profit organization dedicated to opening the fuel market to allow alternative fuels such as ethanol, methanol, natural gas and electricity fairly to compete with gasoline at the pump. CFAE’s mission is to educate citizens and government officials about pragmatic, non-partisan affordable energy solutions.
“The purpose and the focus [of FFF] is exactly in line with what I promoted as president of Shell and subsequently as the founder of CFAE,” Hofmeister said to Green Car Congress. “From [these organizations’ standpoints], the reason we have to get away from doing nothing is that the public doesn’t fully appreciate or understand the situation it faces with respect to fuels’ futures.”
We exist to better educate the public, to have the conversations that need to be had with government, corporate executives, NGOs, with all sectors of society, on future alternatives.
We have to look at the fuels marketplace from a short-, a medium-, and a long-term perspective. There will not be enough oil to stay on the path we’re on globally over the short- and medium-, let alone the long-term. By the time we meet China’s needs, India’s needs, the developing world’s needs, there just is not enough supply to rely 100% on oil as a transportation fuel. It’s not going to happen.
—John Hofmeister
In his 2010 book Why We Hate The Oil Companies, Straight talk from an energy insider, Hofmeister suggested that Americans would be facing the beginning of gasoline lines in the 2016-2020 timeframe.
That onset of what he calls the “beginning of the energy abyss” was predicated on normal economic growth, including China’s growth, he noted. Since writing the book, economic growth has been “stunted”, and China’s growth reduced. That, he suggested, might stretch out the beginning timeframe a little further.
It’s inevitable. The industry that produces oil can’t produce enough, unless the world doesn’t grow. It’s possible that we will have such expensive oil that we will stymie growth. How many people will suffer? How many poor will become poorer, while rich become richer because we have failed rational tests of creating alternative competitive fuels? We have a choice to condemn ourselves to an energy abyss in the name of the status quo and lack of enlightened leadership, or we can choose to develop alternatives.
Why aren’t we more thoughtful about the future? Why don’t we begin the journey towards a range of alternatives that delivers increased national security, increased economic security, and multiple choice for consumers?
I think in this regard, we are missing in the whole construct, a meaningful voice of government as an intermediary and an enabler to a better future when it comes to fuel choice. The US has been crippled for 7 years by high-priced fuel; the government has done nothing to speak of to address the issue.
—John Hofmeister
There are many options theoretically available, Hofmeister said, including natural gas for multiple transportation fuel applications: LNG, CNG, GTL synthetics, methanol for personal vehicles, even gasoline from natural gas. The organizations are also pushing electric vehicles as an important options, whether battery-based or hydrogen-fuel-cell based.
Analysis of the viability or attractiveness of the different options should rely on a mix of cost, resource availability, and carbon footprint, he suggested.
We need a competitor for oil. We need to open the market to replacement fuels like methanol, ethanol and natural gas. Competition will drive transportation fuel prices down, structurally and sustainably. These fuels are well within our reach, we can implement them into our existing system without the need to wait twenty years for fleet turnover. Fuel Freedom’s approach to opening the fuels market by breaking the oil monopoly is America’s next giant leap forward.
—John Hofmeister
In terms of taking steps forward, Hofmeister suggests that “first and foremost” there should be a serious, twin-path discussion on the future of natural gas as an alternative fuel, with specific focus about what works best for trucking and trains, and on what works best for personal vehicles. “Let’s see what the market does to grow both, the industrial side and the consumer side. We haven’t had that conversation yet.”
Further, Hofmeister suggested, that even though EVs are off to a slow start, the US should continue to enable the infrastructure to be built to enable both types of electric vehicles, battery and hydrogen.
I think hydrogen fuel cell capability in the next 20-30 years will be more than people give it credit for. It’s not a fix for tomorrow, it’s too soon. But with the work going on and cost reductions already accrued in fuel cells and vehicles...I would hate to be taught by Japan and Germany how to do it, how to develop the infrastructure for hydrogen fuel cell vehicles. But that’s quite possible.
—John Hofmeister
Electrons from the Sun as sustainable replacement for liquid fuels, NG, Coal etc?
Higher efficiency solar cells (38+% from Sharp or better future units) + lower cost storage units could turn vast nonproductive desert lands into valuable sustainable energy production areas.
Current Oil and NG pipelines networks could become part of new DC electricity transportation grids.
Posted by: HarveyD | 30 April 2013 at 07:15 AM
GTL synthetics
This is practical, the U.S. will not scrap 200 million liquid hydrocarbon fueled vehicles and replace them with electric any time soon. The replacement will not even be 1% in the next 10 years.
Posted by: SJC | 30 April 2013 at 07:30 AM
Electrified vehicles (HEVs, PHEVs + BEVs + FCEVs) is already taking 23+% of sales in Japan and growing fast. The Chinese, Indian, Singapore and South Korean markets may be next.
In USA and Canada, with their very strong Oil Industry and powerful lobbies, the introduction of electrified vehicles will be slower, but it will come with a 10+ years delay?
It is not a question of scraping 230+M ICEVs in USA or 950+M worldwide. The replacement will be progressive (during 20+ years) and will take place when owners change their vehicle.
Posted by: HarveyD | 30 April 2013 at 08:06 AM
When US gasoline prices double again or approach European /Asian prices, electric vehicles(w/hybrids) will become 10% of new sales very quickly.
Hybrids were already over 16% of 2011, 2012 new Japanese car sales.
Nissan is about to begin ads on the economy of $199/month leases and no gas/recharging.
Many complain about EV sales, than fail to note most EVs are available only in a small fraction of the 50 states.
Posted by: kelly | 30 April 2013 at 08:13 AM
Many countries in EU and Asia with less or no Oil, Coal and NG production have more to gain by switching to more efficient HEVs, PHEVs, FCEVs and BEVs and they should.
We have plenty of Clean Coal, Clean Tar Sand Oil, Clean Shale Oil, Ultra Clean NG/SG, Extra Clean Corn based Ethanol and excellent professional sale persons and deep pocket owners to push those wonderful clean products.
The new (2017/18) lower cost 500+ miles ultra quick charge Tesla EVs (and equivalent from other manufacturers) may be required to convince us to switch.
Posted by: HarveyD | 30 April 2013 at 08:40 AM
If you are expecting $4 gasoline going to $8 gasoline in the U.S. causing 10% of the 200 million vehicles to become electric, I would ask what evidence do you have to support this?
Think back 10 years ago, gasoline was about $2 gallon and then in 2008 became $4 per gallon. We did not see a rush to buy hybrids. We have had 5 years since then with more expensive gasoline and we don't have 10% hybrids on the road.
Posted by: SJC | 30 April 2013 at 09:52 AM
Over 10% of the world's largest automaker sales are already hybrid - http://online.wsj.com/article/SB10001424127887323375204578269181060493750.html
Posted by: kelly | 30 April 2013 at 03:59 PM
Over 10% of the world's largest automaker sales are already hybrid - http://online.wsj.com/article/SB10001424127887323375204578269181060493750.html
Posted by: pat | 30 April 2013 at 04:05 PM
"Hybrids were already over 16% of 2011, 2012 new Japanese car sales."
An ICE powered car. I do not know how they drive in Japan but there is no evidence that the theory that there is an efficiency improvement for the ICE.
Hauling batteries around with a ICE seems to induce selective data collection.
Posted by: Kit P | 30 April 2013 at 06:34 PM
For decades, we have hauled 1000+ lbs ICEV drive trains, axles, converters, radiators, exhaust system, huge gas tank and 20 gals of gas in our 12 to 15 mpg gas guzzlers.
In the near future (2020+ or so) extended range BEVs will haul about 800 lbs of e-drive trains, e-ancillaries and batteries and will consume about 60% to 75% less energy than our current gas guzzlers to go from A to B.
Gas guzzler fans will cry but the switch will take place.
Posted by: HarveyD | 30 April 2013 at 06:50 PM
We still need better, more affordable batteries.
Their volume and weight are not too bad; they remain too expensive.
GM loses money on every Volt.
Even with a $7,500 U.S. tax credit, it sold only 4,244 through March and 23,461 in all of last year.
From The Detroit News: http://www.detroitnews.com/article/20130430/AUTO0103/304300449#ixzz2S2dOJYtr
GM implies that if they reduced production cost by $10,000 they would be profitable and sales would be good.
That is a whopping $17,500 "reduction target" if we assume it must stand on it's own with no "entitlements". And that assumes "reduce production cost by $10,000" means "reduce sales price by $10,000"; otherwise it is even worse.
At that point we have a competitively priced small car with seating for 4 with GREAT gas mileage and range.
We still need better, more affordable batteries.
And PLEASE, let's be adults here and nobody say; all would be well if GM just reduced the sales price.
Posted by: ToppaTom | 01 May 2013 at 05:26 AM
"We still need better, more affordable batteries."
Why?
Every reason stated to promote BEV is a steaming pile of you know what.
One good reason, just one. Take your best shot!
Posted by: Kit P | 01 May 2013 at 06:16 AM
This time I have to agree with TT. The world certainly needs higher performance, lower cost EV batteries.
Single pass integrated battery elements mass (machine) production could reduce cost but better performance battery technologies have to be developed and mass produced.
Many improved battery technologies are at the Lab level and could be in production by the end of the current decade or early in the next decade.
Eventually, (sometime between 2020 and 2030), 1000+ Wh/Kg, ultra quick charge/discharge EV batteries, made with lower cost materials in fully automated factories, may cost less than $100/kWh.
Posted by: HarveyD | 01 May 2013 at 07:22 AM
Prii electric powers ~every city 'stop sign' start and most accelerations - to a EPA of 50 mpg.
The overall non-hybrid ICE car average mpg is below 25 mpg.
EPA 25 mpg is worse than EPA 50 mpg.
Above "Over 10% of the world's largest automaker sales are already hybrid" - no argument.
Posted by: kelly | 01 May 2013 at 08:27 AM
When gasoline in the U.S. went from $2 to $4 per gallon in the U.S. in 2008, you would expect everyone to go out and buy a Camry hybrid that turned 20 mpg into 40 mpg, they did not.
Expecting everyone to go out and buy a $30,000 BEV that gets a 100 mile range is not realistic. They may sell more with a battery improvement, a LEAF that sells for $20,000 with a 150 mile range would find some buyers.
Posted by: SJC | 01 May 2013 at 02:57 PM
Even existing battery technology can make a PHEV very appealing to most buyers.
For example, the C-Max Energi PHEV can be tweaked to be less exensive, lighter, and to have more luggage space. The 144-hp 4-cylinder engine can be downsized to 72-hp 2-cylinder engine. The space saved in the front engine bay can be used to place 1/2 of the battery pack. The fuel tank can be downsized from ~14 gallons (?) to 7 gallons to allow room for the other half of the battery pack. Thus, the luggage space will be comparable to other non-HEV. The reason that the Energi share the same power plant with the HEV C-Max is simply due to Ford trying to save on development cost. An optimized PHEV must have the ICE's size reduces to 1/2, as well as the fuel tank size.
The Volt can have the battery pack downsized to 8 kWh, and the engine can be purchased or copied from the Fiat 500 2-cylinder engine. The price of the new and lighter and cheaper Volt will be comparable to that of a HEV, and can now carry 5 passengers instead of 4.
The above 2 examples of PHEV will be like have 2 cars for the cost of one: a BEV and a ICEV. In case the ICE power plant fails, the BEV power plant will allow the owner to commute to and from work just fine, when charged twice daily. With charging jacks available in most malls and other parking places, one can drive all day, 80-100 miles on battery power alone. It only takes 3 hours to fully charge for another 20-mile disance.
When a car reaches 150k-200k mile mark, most ICEV will be discarded because of high engine repair and maintenance cost. For a PHEV, the engine was barely used for about 35-70k miles, still practically new, and the car is ready for another 150k-200k miles, or 300k-400k miles total lifespan.
The price premium paid for the two new-and-improved PHEV as mentioned will be many times recuperated for by savings in fuel cost. The double-durability of the vehicles is purely bonus. Let's see who can resist buying those new-and-improved PHEV examples that I've given?
Posted by: Roger Pham | 01 May 2013 at 05:37 PM
Even existing battery technology can make a PHEV very appealing to most buyers.
For example, the F0rd C-M@x Energ! PHEV can be tweaked to be less exensive, lighter, and to have more luggage space. The 144-hp 4-cylinder engine can be downsized to 72-hp 2-cylinder engine. The space saved in the front engine bay can be used to place 1/2 of the battery pack. The fuel tank can be downsized from ~14 gallons (?) to 7 gallons to allow room for the other half of the battery pack. Thus, the luggage space will be comparable to other non-HEV. The reason that the Energi share the same power plant with the HEV C-M@x is simply due to F0rd trying to save on development cost. An optimized PHEV must have the ICE's size reduces to 1/2, as well as the fuel tank size.
The V0lt can have the battery pack downsized to 8 kWh, and the engine can be purchased or copied from the Fi@t 500 2-cylinder engine. The price of the new and lighter and cheaper V0lt will be comparable to that of a HEV, and can now carry 5 passengers instead of 4.
The above 2 examples of PHEV will be like have 2 cars for the cost of one: a BEV and a ICEV. In case the ICE power plant fails, the BEV power plant will allow the owner to commute to and from work just fine, when charged twice daily. With charging jacks available in most malls and other parking places, one can drive all day, 80-100 miles on battery power alone. It only takes 3 hours to fully charge for another 20-mile disance.
When a car reaches 150k-200k mile mark, most ICEV will be discarded because of high engine repair and maintenance cost. For a PHEV, the engine was barely used for about 35-70k miles, still practically new, and the car is ready for another 150k-200k miles, or 300k-400k miles total lifespan.
The price premium paid for the two new-and-improved PHEV as mentioned will be many times recuperated for by savings in fuel cost. The double-durability of the vehicles is purely bonus. Let's see who can resist buying those new-and-improved PHEV examples that I've given?
Posted by: Roger Pham | 01 May 2013 at 05:41 PM
"Let's see who can resist buying those new-and-improved PHEV examples that I've given?"
Resisteing Roger's fantasy is very easy based on the reality of the regular cars in my driveway.
Posted by: Kit P | 02 May 2013 at 10:14 AM
@Kit P,
If you wanna keep fixing an ICEV over and over after 150-200k miles,be my guest. Frequent engine and transmission repair, brake work, etc...Or trade in a worn-out ICEV for a new ICEV and paying 15-20k dollars to the car dealer...be my guest.
Keep in mind that car with that kind of mileage may get you stranded in the most inopportune of moments...harsh weather or being prey to criminal elements, missed appointments, messed up vacation plan...etc.
As for me, I'd rather drive using electricity daily, and only rev up the ICE once a week for a long drive in the country. When the car reaches 150-200k miles, ain't no problem. The engine is still like new...no transmission to worry about, and the brakes are hardly used, still like new. Just replace the tires after 60-80k miles, replace the batteries like you're replacing the lead-acid car batteries now...and keep on driving for another 150-200k more miles...Save $20,000 USD on fuel cost alone every 200k miles, or $40,000 USD after 400,000k miles the lifespan of the PHEV.
You keep doing what you like to do, but I and E-P will get the last laugh! He he he. :-)
Posted by: Roger Pham | 02 May 2013 at 02:43 PM
"If you wanna keep fixing an ICEV over and over ..."
How about I let you know when I start. Roger seems to confuse reality with his fantasy.
When the frequency of repair statistics show that a PHEV will pay back the cost, then I will consider one but a 25+ payback period does not inducate that it will happen soon.
Prediction based on wishful thinking are not very useful.
Posted by: Kit P | 03 May 2013 at 01:46 PM
@Kit P,
I've had my share of repair of engines after 120-200 miles. Repaired one thing, then some time later, another part went bad! Of course, old engines consume oil, leak oil and pollute the environment.
>>>>"When the frequency of repair statistics show that a PHEV will pay back the cost, then I will consider one but a 25+ payback period does not inducate that it will happen soon. "
Prudence is always a good thing. Wait just a few years and you will be pleasantly surprised. However, the savings in fuel cost alone is sufficient to justify owning a PHEV. The independency from petroleum is priceless. The other advantages of PHEV's are purely bonuses.
Posted by: Roger Pham | 04 May 2013 at 12:18 AM
“old engines consume oil, leak oil and pollute the environment. ”
Not mine, not anymore. Forty years ago I used to buy oil by the case at K-Mart for my old POS. Thirty years ago expected a new car to use a quart every 1000 miles. I have had two ICE with 250+miles that used no oil between oil changes.
“Wait just a few years ”
Maybe Roger should wait a few years until he has some some facts instead of stating wild projects as facts.
Posted by: Kit P | 04 May 2013 at 08:31 AM
My grandfather used his horse till he died. He refused to drive rightfully claiming that his horse and buggy always brought him back home. His horse (like most horses) had a great memory and always brought back home while he was sleeping.
Today's IVECs fans can't claim as much?
Posted by: HarveyD | 04 May 2013 at 09:40 AM
@Kit P,
>>>>"I have had two ICE with 250+miles that used no oil between oil changes."
Too good to be true, unless you've had the engine overhauled with new valves,new piston rings, new cylinder liner, etc...At 100k-150k miles, most cars start to consume oil and is worsening as the cars reach the 200k point. The emission control system is becoming less and less effective at this point when the warranty on emission control system runs out, and be prepared to pay $$$ for replacement when comes the day that you will fail emission check yearly.
If these 2 cars' engines have not been overhauled and still have original valves, piston rings, etc please kindly tell us who made them, and what kind of oil you used in them. I know that you changed your oil every 3,000 miles.
>>>>"Maybe Roger should wait a few years until he has some some facts instead of stating wild projects as facts."
No need to wait. Engineer-Poet is owning his PHEV right now and will provide us with facts as he continues to enjoy his state-of-the-art ride!
Posted by: Roger Pham | 04 May 2013 at 07:56 PM
@Roger
“Too good to be true ... ”
Well it is true. It is not a secret either. To make an engine last 500k miles without an over haul requires only three things. Buy the right engine for the job, change the oil as recommended by the dealer, and do not abuse a cold engine. Not hitting a deer at 70 mph helps too.
I bought a '89 Toyota extended cab pu and lived out of it for a few years because of the work situation. It went over 200k on the Golden gate Bridge. It was a 2wd V-6 with a 5 speed manual tranny. It was great to drive and my wife of son loved it. A similar Ford product with 4wd, automatic was an example of car that would require lots of repairs after 150k miles. Took the boys skiing with a friend and he insisted on driving because he had 4wd. When we got back, I let him drive it and he fell in love.
I bought my 2wd '89 Ford Ranger of $1200 more than ten years ago. I needed a cheap pu. At the time I was not worried about how long it would last but one could eat of the engine that had 200k on it. The seller had every piece of paper down to tire rotations. I did some research after ward. The 4 banger is a Mazda engine with a with a 5 speed manual tranny.
The cheapest thing you could buy in '89 now has almost 270k miles.
I have owned oil burners. A cloud of blue smoke and a dardy high o'sliver away she goes. I paid $25 for a '60 Rambler that got 50 miles to the quart. It was worth every penny because it got me my next duty station but died on the first 30 below day. My '64 327 Impala was a monster that I paid $200 for and it used two cases of oil getting me to Long Beach where it contributed to terrible air pollution when I was not out to sea. I traded car that went to to the local stock car races for '67 327 Impala station wagon perfect for hauling babies home from the hospital and getting through college. Also had an '84 Honda Civic and '86 Mitsubishi Colt that required weekly spark plug cleaning.
My close to Detroit roots made me skeptical of small block rice burning engines. My dad and brother in law who lived in California were first to abuse these toys. My first rice burner was a 12 year old '68 Toyota that I paid $250 for driving to the shipyard. It was ugly but fell in love with it for its reliability.
“At 100k-150k miles, most cars start to consume oil ”
Roger is again making up stuff. I have two in that range that are showing no sighs of oil use even when started cold. I rarely see a car burning oil these days to the point that it is note worthy. It was a '93 Honda Del Sol driven by a high scholer.
Posted by: Kit P | 05 May 2013 at 07:45 AM