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Monday, May 09, 2005

When It Comes to Replacing Oil Imports, Nuclear Is No Easy Option, Experts Say - New York Times

May 9, 2005
When It Comes to Replacing Oil Imports, Nuclear Is No Easy Option, Experts Say
By MATTHEW L. WALD

WASHINGTON, May 8 - President Bush has proposed reducing oil imports by increasing the use of nuclear power, which he said in a recent speech was "one of the most promising sources of energy."

There is a problem, though: reactors make electricity, not oil. And oil does not make much electricity.

Nuclear reactors produce about 20 percent of the electricity used in the United States and about 8 percent of the total energy consumed. Oil accounts for 41 percent of energy consumption.

Could a few dozen more reactors, in addition to the 103 running now, cut into oil's share of the energy market?

"Indirectly, but very indirectly," said Lawrence J. Goldstein, president of the Petroleum Industry Research Foundation, a nonprofit group that studies the economics of oil. People who think nuclear power is a way to reduce oil imports are "confusing several issues," he said.

Peter A. Bradford, a former member of the Nuclear Regulatory Commission, added, "No one knowledgeable about energy policy would link nuclear power and gasoline prices."

In the puzzle of energy consumption and production, however, experts point to three intersections of oil and nuclear power that would offer opportunities to cut demand for oil, pushing down its price and strategic significance. But all are limited, clumsy, expensive or dependent on new technologies whose success is not guaranteed, the experts say.

The first option is to replace the oil used to make electricity with new nuclear reactors. But most of the oil in the electric sector has already been replaced, by coal.

According to the Energy Department, last year the electric utilities used about 207 million barrels of oil, or less than 600,000 barrels a day. (Total American consumption of oil is about 20.5 million barrels a day.)

Even the 600,000-barrel figure is higher than what nuclear reactors could replace, because some of that oil is used in generators that run only a few hundred hours a year. Reactors must run continuously, so they could not replace the oil-fired plants that are used only intermittently.

The electric system consumes another fuel that nuclear power could replace: natural gas. Last year, American utilities burned just under 5.4 trillion cubic feet of natural gas, out of total consumption of 22.3 trillion cubic feet.

"You can get a scenario where nuclear would free the gas to go to other things," replacing oil and gasoline, said Thomas Capps, the chairman of Dominion, one of several electric companies that have expressed interest in building new nuclear reactors. "You can run cars on natural gas," he said.

The technology for that is available, but not many people use it. According to the Natural Gas Vehicle Coalition, a lobbying group, about 130,000 such vehicles are on American roads today, out of more than 200 million. After decades of promoting natural gas, federal and state governments have made some headway in persuading commercial fleets to switch. But they have essentially given up on selling natural gas to ordinary consumers, who have been unwilling to convert their vehicles to use it.

There is also little economic incentive behind using natural gas. Mr. Goldstein noted that the current wholesale price of gas, about $7 per million B.T.U. (the standard unit by which gas is sold), is the equivalent of $42 per barrel for oil. But oil now sells for about $50 a barrel, which means the price difference is not enough to induce a switch.

Gas must also be pressurized for a car to hold enough to travel more than a few miles; pressurizing it and distributing it to service stations would add expense.

But there is another way that nuclear reactors could influence the oil supply, one that bypasses electricity completely. Nuclear engineers are working on designs and materials for a new class of reactors - which could be ready in about 20 years - whose main product would be heat.

The Idaho National Laboratory in Idaho Falls, which is owned by the Department of Energy, is working on ways to take very hot steam from a nuclear reactor, then run a small electric current through it to separate the water molecules into hydrogen and oxygen. If that can be done more cheaply than the current method of producing hydrogen, which uses natural gas, the hydrogen could be used at refineries to make components of gasoline.

Gasoline is made of molecules with a certain ratio of carbon to hydrogen. Part of each barrel of oil consists of molecules with too much carbon to be useful in gasoline; instead, those molecules are used only in low-value products like asphalt and tar.

The technology exists for refineries to break up those molecules and add hydrogen, until the hydrogen-carbon ratio is suitable for making gasoline or diesel.

David Lifschultz, chief executive of Genoil, a company that makes systems for using hydrogen at refineries, says the oil supply being exhausted first is light oil, which has many components that can be used in gasoline. Heavy oil, with components high in carbon, is far more abundant and often sells at a discount of $20 or $25 a barrel, he said.

Available technology could convert 16 million barrels a day of heavy oil, about a sixth of the world supply, into gasoline components, Mr. Lifschultz said, driving down the price of light oil.

J. Stephen Herring, a consulting engineer at the Idaho lab, explained two other ways for reactors to make motor fuel.

Canada has vast reserves of shale oil, now being converted to ingredients of motor fuel by using natural gas. The gas is used to heat the shale to make its oil flow more easily, and hydrogen, also obtained from the natural gas, is incorporated into the oil to make it suitable for use in gasoline. But a nuclear reactor could do those jobs, delivering both hydrogen and steam for cooking the oil out of the rock, Mr. Herring said.

Another strategy, he said, would be to break down coal, shale oil or other hydrogen fuels into a gas comprising hydrogen and carbon monoxide. At high pressure, these materials could form molecules suitable for making gasoline or diesel. A reactor could provide the energy required.

But using a reactor to make the ingredients of gasoline is many years away; the new reactors being considered by utilities are similar to the ones running now. The experts say that only after several of those have been built and have run for a few years is a private company likely to try something more adventurous.

Mr. Herring did not fault that strategy. "If I were responsible for spending the billion dollars," he said, "I'd be conservative, too."

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