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News Great Green Fleet and $26/gal fuel

  1. Jul 3, 2012 #1
    “Great Green Fleet” and $26/gal fuel

    http://www.foxnews.com/politics/201...at-green-fleet/#ixzz1zX8phjVc?test=latestnews

    I'm surprised the navy pays as much as $3.60/gal for the fuel it normally uses. I would have thought it much lower. Don't they get a pass on the fuel taxes? I can understand a demonstration project using biofuel, but at 7 times the cost per gallon, this large a scale implementation seems crazy. I would think our economy and taxes would be wiser spent on the $3.60/gal fuel. I would prefer my tax dollars spent wisely and not trying to create a market for a product the administration "wants". "Navy Secretary Ray Mabus’ plan to have half the Navy fleet on alternative fuel by 2020"!

    I wonder what the side effects are going to be. I recall grain issues when feed corn was being used to make ethanol for gas. http://grist.org/corn/2011-02-11-usda-announces-corn-supply-at-15-year-low-thanks-to-ethanol/ I worry cost my sons chicken fingers, french frys, and my deep fried holiday turkey are about to go way up. Peanut oil prices ya know.
     
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  3. Jul 3, 2012 #2
    Re: “Great Green Fleet” and $26/gal fuel

    First, you have to remember that the Navy's purchasing requirements are somewhat hampered by the Government's social policies, and second, the way we write contracts in the federal Government almost forces extreme prices (remember the $400 hammers?) because we dictate every little design item rather than allowing manufacturers to produce. As a Government contract specialist, I could tell you stories that would have you shaking your head in disgust. IMHO, this is the norm in federal acquisitions rather than the exception.
     
  4. Jul 3, 2012 #3

    D H

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    Re: “Great Green Fleet” and $26/gal fuel

    Does it really matter? That's just a number for comparison purposes with the $26/gallon figure.

    This is intended misinformation coming from the Republican party and from Fox News. Stop watching Fox News. It stunts your IQ. Let's look at some facts.
    • Fact: In 2006, this was a fantastically good idea to most Republicans when the Bush administration first started investigating using the DoD's purchasing clout as a mechanism to wean the US off of foreign oil and onto cleaner, domestically produced biofuels.

    • Fact: In 2007, this was a good idea to most Republicans (not fantastically good, though, because Democrats liked it) when Bush signed the Energy Independence and Security Act of 2007 into law.

    • Fact: In 2008, this was still a good idea to most Republicans when the Bush administration started a small scale demo biodiesel project, even though dividing the number of gallons to be delivered by the projected project cost yielded an apparently ridiculous $424/gallon.

    • Fact: In 2008, most Republicans knew that dividing the projected output of a new technology project by the projected project cost was an intentionally misleading statistic. A big chunk of the cost goes to technology and infrastructure development.

    • Fact: In 2009, this suddenly became a fantastically bad idea to most Republicans when it became a Democratic idea.

    • Fact: In 2009, dividing the projected output of a new technology project by the projected project cost suddenly became a perfectly valid statistic.

    • Fact: In any year, a fantastically good Republican idea that demonstrates the power of capitalism and capitalizes on public/private cooperation becomes a blockheaded, almost communistic idea when the Democrats take over.

    • Fact: In 2012, Fox News and the Republicans have pretty much convinced me to switch my party affiliation. To Democrat.
     
  5. Jul 3, 2012 #4

    russ_watters

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    Re: “Great Green Fleet” and $26/gal fuel

    I wouln't base my party afiliation on what I read/see on Foxnews.
     
  6. Jul 3, 2012 #5

    D H

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    Re: “Great Green Fleet” and $26/gal fuel

    That $435 hammer is pure fiction. Didn't happen. It's a combination of bad accounting, bad interpretation of bad accounting, bad reporting. It's politicians taking advantage of anything and everything to make political hay, media taking advantage of anything scandalous to sell a story. That the story isn't true doesn't matter.
     
  7. Jul 3, 2012 #6
    Re: “Great Green Fleet” and $26/gal fuel

    I could care less about demonstration projects 5 years ago, when we expect costs to be higher to "look" at something new. Now we're looking at a large scale conversion with a 700% increase in cost. According to the article, it's doesn't appear to be "conversion costs", since the engine doesn't require modification. I assume the fuel storage would likewise be suitable for either fuel. This doesn't appear to break any new cutting edge technology. Regardless of political party nonsense some seem intent on dragging into this discussion, this is about our tax dollars! My post would read the same whether republicans or democrats were behind it. I think ethanol is a good idea, just not from food grains. I think waste gas from public dumps has a place in energy production. I just don't see a valid reason for this large scale project at these fuel prices.

    Lastly, your "Facts" are not based on specific references, so context is missing and accuracy is questionable. e.g. I'm sure grain producers think E85 is great, but I suspect cattle ranchers don't think much of the price they pay for feed, so whether republican or democrat, their vote may just reflect those they represent.
     
    Last edited: Jul 3, 2012
  8. Jul 3, 2012 #7
    Re: “Great Green Fleet” and $26/gal fuel

    Or CNN, MSNBC, ABC, etc., etc.
     
  9. Jul 3, 2012 #8

    D H

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    Re: “Great Green Fleet” and $26/gal fuel

    You are still confusing sunk costs with recurring costs. One key goal of these DoD biodiesel programs is to bring the recurring costs down to $3/gallon. A better way to look at that $26/gallon figure is that the Navy paid an absolutely huge amount for the very first gallon, but paid a much lower amount for the remaining 449,999 gallons. Not the $3/gallon goal, but much less than that inflated $26/gallon figure.


    Of course it does. Scaling up a small scale, laboratory-based prototype to an industrial scale effort is new technology. In the world of engineering, things don't scale without lots of effort. Sometimes prototypes don't scale up, period. In this case, things did scale up, but at the expense of significant new sunk costs.

    This is about the federal government being involved in large scale, long term scientific and engineering research. While past performance is not always an indicator of future success, past performance shows that funding research is one of the best uses of your tax dollars.

    The same kind of fallacious statistics applied to these projects would make that $26/gallon figure look downright reasonable. You have fallen prey to the intended result of this fallacious statistic, which is that this $26/gallon figure will be the cost for future efforts.
     
  10. Jul 4, 2012 #9
    Re: “Great Green Fleet” and $26/gal fuel

    First off: This exact story is being reported by many different places, not just Fox News.

    http://www.reuters.com/article/2012/07/02/us-usa-navy-greenfleet-idUSBRE86106X20120702
    http://www.mnn.com/earth-matters/po...licans-criticize-26-a-gallon-biofuel-being-te
    http://www.guardian.co.uk/environment/2012/jul/02/us-navy-green-fleet?newsfeed=true

    Those were some of the results from the first page of google. Reuters and the leftist Guardian both reported the same thing. Claiming some VRW conspiracy about the cost and impact (just because it appeared on FoxNews.com) seems to be jumping to a harsh conclusion about the validity of the arguement.

    Relying on any single news source, in this day, is a poor idea to be truely informed. Fox isn't anything special there. Even I read MSNBC and CNN to see what the radical left is thinking day-in-day-out. Lastly on politicalization: it should be noted that many democrats were against this green-fleet 'expansion of the military' when it was introduced under President Bush (just like many Democrats were against the ACA-equivalent proposed by Rep Gingrich in the 90s because they didn't want to force people to pay into for-profit companies). It goes both ways... so the inconsistency arguement doesn't really hold much weight because BOTH sides had to have swapped places for the arguement to really hold, so both sides are just as culpable. And the devil is in the details - generalizing very complex issues to 'well, you supported something that was kind of similar when you looked at it in the correct light a few years ago' is a pretty lazy arguement.

    Second: besides the cost - I would be worried about the weight. I didn't see anything actually accounted for on the loss of energy that there would be by using the less-potent fuel. Even some of the best automobile ethanol-blends available have ~25% less output than the same amount of gas (quick-read online source and it's also well documented in any flex-fuel owners manual). I understand the desire for our military to be environmentally friendly, but if we were to allow any one-entity to actually do the 'most efficient thing possible' wouldn't we want it to be our warships and planes? Imagine if our warships required 25% more fuel (by way of volume) during WW2? We may have lost the pacific. Fuel was the #1 scarcist commodity for the expeditionary fleet. (A counter to this, that I am aware of - the navy is still using conventional engines, so switching back to conventional fuel during a war wouldn't be a big deal except that we would possibly be lacking the infrastructure to support conventional fuel production.)

    Third: I haven't found any counter-evidence to this being cheaper than conventional fuel, even in the long run (except for extreme situations like if we get totally shut off from the rest of the world's oil). If conventional fuel is provided to the government at 3.60/gal that would presumably include the sunk costs comparable to the 26/gal as well. These are contracts just the same (and the risks associated with losing that contract/production after it's expiration, just the same). Even accepting the disparity in sunk cost (presuming that much of the difference is a 1-time cost difference) - to produce enough fuel to meet the navy's needs (even part of their needs), when does the sunk cost actually start to be 'worked out' of the cost? $26/gal for a small fleet for a few weeks... now lets expand that to several large fleets over years. To keep up with production, I don't think the infrastructure cost-savings will be that big of an effect in any near or mid-term projections. To make up for the cost of a biofuel you'd probably be looking at several decades (part of what makes conventional fuels comparably inexpensive is the almost 100 years of infrastructure, right?). Bottom line: some sunk costs will be saved over time, yes, but not enough to account for the 7x cost of traditional fuels.
    Also the cost will go down a bit as bulk increases intrinsically, but I have a hard time seeing a decrease to be competitive gal-to-gal (and see above about needing more 'blended-per-mile' than 'gas-per-mile'). Further, this isn't taking into account that OPEC could just increase production, decrease the cost of oil, and remain competitive with any biofuel. This could be an advantage in itself, but that's not the point of this exercise as I don't think the navy is really worried about the cost (which is ultimately the point of the general critique from the GOP).
     
  11. Jul 4, 2012 #10
    Re: “Great Green Fleet” and $26/gal fuel

    Read the OP Fox news link carefully. This purchase was for a one time operation. The biofuel is also mixed 50/50 with regular fuel.


     
  12. Jul 4, 2012 #11

    D H

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    Re: “Great Green Fleet” and $26/gal fuel

    Well of course it's basically the same story. The reporters all attended the same Navy press conference whose was intent was to brag about the accomplishment. Another thing that makes them similar: Your Guardian article is the same as the Reuters article. Your MNN story is pretty much the same as the Fox News article. Very few organizations report the news nowadays. Most buy articles from other news outlets, then reprint it, sometimes with attribution, sometimes without. It's kind of amusing that Mother Earth News based it's story largely on the story from Fox News. Another common factor is that $26/gallon figure. Newsies of all ilk, left, right, center are technically incompetent. What they do know is what makes for a good titillating headline.

    Four out of 233 Democratic representatives and four out of 50 Democratic senators does not qualify as "many".

    You do this all the flippin' time, justify Republican hijinks with Democratic hijinks. It doesn't work. Of course both parties pull this junk. There are differences of degree, however. I don't remember the last time when I saw as much excrement as I see now.

    You're barking up the wrong tree here. This isn't ethanol. It's biodiesel. The Navy bought 350,000 of 50/50 blend HRD-76 fuel for their ships, 100,000 gallons of 50/50 blend HRJ-5 fuel for their aircraft. Except for the source, that 350,000 gallons *was* mil spec F-76, the 100,000 gallons, JP-5. They were drop-in replacements.
    Here's the RFP: https://www.fbo.gov/?s=opportunity&mode=form&id=0d3e37310e680fdc8c53bce53828f6e1&tab=core&_cview=1
    Here's the qual testing on the delivered HRD-76: http://www.navsea.navy.mil/Media/SAS2011/ED GODFREY-AlternativeFuels-SAS2011.pdf

    Huh? The sunk costs for petroleum were bought and paid for long ago. The petroleum industry knows how to extract oil. They reuse the rigs over and over. They know how to do the refining on a massive scale. The delivery system is already there. Producing biodiesel from algae (as opposed to recycled fast food restaurant grease) on anything close to a large scale is uncharted territory.

    According to this study, a decade or so. http://www.dtic.mil/dtic/tr/fulltext/u2/a556489.pdf. There are plenty of others, some say less, some say more. 100 years? No.
     
  13. Jul 5, 2012 #12
    Re: “Great Green Fleet” and $26/gal fuel

    Where do you get a decade or so? His 'likely' scenario still has biofuels at a 20% premium to traditional fuels in 2028 (with no scenario biofuels actually having a cost-advantage on traditional fuel). Best case in 2028 a carrier's airgroup costs $30M/year more to run in the future, worst case it's $140M/year (and that's just one air group - not an entire fleet). Further, and the author mentions this, his study is considering a coal-based-additive as a bio fuel (which is helping to keep the cost down for sure). So, even with his cost estimations, he's not sure the environmental impact is as light as it might be billed. He's also considering prices that the Military will be the only buyers of this new biofuel - if it really is that good, there will be others wanting some fuels made with the same process as well which will definitely drive up the price.

    Again on the politicization - DH, you were the first to bring blame towards a political party in this. I'm not always correct, but at least I don't look at someone/something and say 'they're a democrat, that must mean they're wrong' like you have twice in this thread already (towards the GOP/Fox News). Facts can still be interpreted multiple different ways - where you see a high cost now with large benefit in the future, someone else sees high cost now with no benefit in the future. Who's really right? Personally: I see the government being so involved in green technologies as a disincentive for them to become affordable. Why would a company need to make their product more affordable when the government (military, etc) is willing to foot the bill?

    Lastly - who is the contract for the biofuels with? I looked through a few of the articles again and didn't notice who?
     
  14. Jul 7, 2012 #13
    Re: “Great Green Fleet” and $26/gal fuel

    Because what we are talking about here is not quite the norm. The military consumes about 2% of the fossil fuels in this country. You think that any company is just going to sit by and be happy with getting a portion of that 2%? Also do you think that whatever contract they sign is going to be permanent? They will have to compete with other companies for contracts. So if they want to stay in business, they will have to get their prices lower as someone will always be looking to undercut them.
     
  15. Jul 17, 2012 #14

    mheslep

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    Re: “Great Green Fleet” and $26/gal fuel

    I'm not sure that the lower energy density of ethanol matters as long as the price per joule is the same, excepting the cases where range is critical, i.e. on many (but not all) aircraft. That is, where expanding the fuel tank ~15% is a trivial matter then I don't see a performance issue.
     
  16. Jul 17, 2012 #15
    Re: “Great Green Fleet” and $26/gal fuel

    As was pointed out already, I was mistaken by comparing this biofuel to ethanol-added gas. The biofuel is specced similarly to the current fuel that is used, so there is no drop in energy.

    The majority of this fuel, though, is being used in combat aircraft - where fuel-space is at a premium even compared to the already tight fuel consumption on the fuel-based warships.
     
  17. Jul 18, 2012 #16

    mheslep

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    Re: “Great Green Fleet” and $26/gal fuel

    As the topic suggests I thought much of the fuel would propel ships, not aircraft?
     
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