How Many BioGas Plants Could You Build For A US-$1.5 Billion Loan That You Could, Sort Of, Pay Back Eventually?
by John Laumer, Philadelphia 
on 05. 4.06
We’re quoting here from a recent Associated Press piece: “BISMARCK, N.D. - Buoyed by high natural gas prices, the Great Plains Synfuels Plant has paid $79 million to the U.S. Department of Energy as part of an agreement that rescued the Beulah factory from a possible shutdown”. Apparently the lignite fed plant, after two decades, has only repaid a small portion ($241 million) of the total Federally guaranteed $1.5 billion construction loan from the early 1980’s. “Low natural gas prices made the synfuels plant unprofitable, and the pipeline companies defaulted on their loans in August 1985. The Energy Department, after operating the plant for three years, sold it to Dakota Gasification in October 1988”.
The plant currently produces “54 billion standard cubic feet of natural gas annually.” The Dakota Gasification Co. website also mentions that they produce such co-products as fertilizers, solvents, phenol,other chemicals, and 200 million standard cubic feet per day carbon dioxide per day (73 billion std cubic feet of C02 per year assuming 24/7 operation). One cited market use for the C02 is “oil development,” in Canada.
Using the numbers supplied on the Dakota Synfuels website, using the assumption stated above, the gas/C02 ratio is approximately 0.74 standard cubic feet of natural gas per cubic foot of carbon dioxide. This presumably does not account for process boiler emissions of C02 nor for C02 emissions by electricity suppliers to the plant. Looked at this way, natural gas is really the “co-product” and C02 is the principal output material.
We’re wondering if other co-products, like the ones listed below, from the Dakota Gasification plant website, would also be produced by some of the newly proposed “clean coal” facilities being touted by the USDOE?
33 million pounds of “Phenol” per year [from the Dakota Gasification Material Safety Data Sheet (MSDS): “Phenol is a combustible, highly corrosive chemical that can cause serious burns and systemic poisoning by all exposure routes.”]
Seven million gallons a year of “Caustic Washed Naptha” [From MSDS: “41% benzene”]
33 million pounds per year of “Cresylic Acid” [From MSDS: “This material has a strong corrosive effect on the skin and eyes. The material can rapidly absorb through the skin and may cause death”.]
Footnote: if the commodity chemical co-products of natural gas were not produced, some portion would be thermally destroyed, upping the C02 production further; and some would go into increasing the overall natural gas yield.
Let’s not forget that once you have “natural gas” there are processes available to convert it to liquid diesel- or gasoline-type fuel. To which you can add the naptha syngas co-product. Gasoline already contains benzene so that’s a logical use. What’s that you say? “ EPA has been studying the feasibility of requiring a lower benzene content of fuel”. Why whatever for?
Back to our post title. The only bad thing about a biogas plant is that they’re not profitable in the real world. They only exist if the government subsidizes them. And the operators won’t be able to pay their loans back on time. Plus, they won’t have all those dandy byproducts to help recoup the investment. So you, Dear Reader, can easily see why Clean Coal is the way to go.
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How's this biogas? It comes from lignite which is coal. This is Syngas. Biogas comes from decomposing organic matter not fossil fuels.
==== author's response ====
This is a parody of those who point to clean coal as a cost-effiective solution to the energy/climate crisis and who dismiss biogas by claiming it is not cost beneficial. I had hoped that the closing paragraphs would make that clear. Guess I'll have to scrap my dream of writing for The Onion.
Don't worry man. You'll still write for the Onion. I see what you're saying now. I just got a little confused for a second. It's still morning you know. :)
yeah, I was reading it and my first reaction was WTF?
This is an example of how the dream of the last energy crisis fell apart.
The dream this time around is wind, biogas and solar panels. There will be many similar stories told in 20 years about today's stylish, yet almost useless energy generators. Energy decisions can't be made from the heart. You need sound economics to make them work.
A biogas plant built today nets the builder/operator many very large and lucrative tax breaks and the like.
There are many economic and [practical?] ways to reduce our footprint on this planet. Conservation is the big one for North America.
==== author's response follows =====
Excellent comments. Billions in taxpayer subsidies (if you include interest) are being passed along not just to the US retail market, but to direct, long term, foreign-owned industrial customers. I have no corroboration but I have to guess that a "Phase II" was envisioned which involved liquid fuel production. Just imagine the billions of pounds of toxic byproducts that would come if this were scaled up! I sure hope the engineers working on the new synfuel ventures have go their minds focused on that issue.
Word
Your first comment was exactly what I was first thinking. Amazingly your second comment is also what I would have responded.
What I find amusing is that most people are talking about the use of biogas
in the deverloped world. But the reality is that Asian countries are doing well
in it. For example, Nepal's success in using biogas has
remained virtually unnoticed so far. Nepal is one of the poorest countries in
the world but in terms of
biogas unit per capita it is way ahead of India and China the two emerging
giants in the world economy.
=== author's response follows ====
Most interesting. Can anyone tell us why Nepal has made such progress? Who led?
15% of Nepalese households use biogas and the number is increasing. In my blog about SOuth Asian Business, I try to cover the alternative energy issues here in South Asia. What is frustrating is that people are too much absorbed with the use of AE in the west but they are either ignorent or forgetful about the success stories in countries like Nepal.
=== author's response follows ===
Lesson well taken. Check back tomorrow.