Record-high world oil prices have prompted renewed interest in producing liquid fuels from coal. The United States leads the world in recoverable coal reserves. Moreover, the technology for converting coal to liquid fuels already exists, and production costs appear competitive at world oil prices well below current levels. Yet, despite its promise, private investment in coal-to-liquids (CTL) technology is being impeded by three uncertainties: where oil prices are heading, what it actually costs to produce coal-derived fuels, and how greenhouse-gas emissions will be regulated. A domestic CTL industry could produce as much as three million barrels per day of transportation fuels by 2030. Having such an industry would yield important energy security benefits, most notably a lowering of world oil prices and a decrease in wealth transfers from oil users to oil producers. But establishing a large CTL industry also raises important policy and environmental issues associated with climate change, coal mining, and water consumption. Weighing both benefits and costs, it makes sense for the United States to pursue an insurance or hedge strategy that promotes the early construction and operation of a limited number of commercial CTL plants. This book presents an in-depth review of the prospects of and policy, governance, and environmental issues associated with establishing a CTL industry in the United States. -- provided by publisher.
This technical report explains an analytic way to design and assess packages of financial incentives that the government can use to cost effectively promote early experience with coal-to-liquids (CTL) production of liquid fuels in the face of significant uncertainty about the future. The report applies two complementary analytic methods. The first uses observations from successful voluntary agreements in the commercial world to identify principles that the government can use to design a relationship with a private investor that is likely to ensure that early CTL production experience occurs cost effectively. Such a relationship yields investor and government behavior that, in turn, generates a set of cash flows to and from investor and government over time. The second analytic method takes these cash flows as given and assesses their effects on the investor and the government. It measures effects on an investor in terms of changes in the investor's real (adjusted for inflation) after-tax internal rate of return (IRR). It measures effects on the government in terms of changes in the real net present value (NPV) of cash flows to and from the government when assessed at the discount rate set by the Office of Management and Budget (OMB) for investments of this kind. The cash-flow analysis focuses on a hypothetical CTL combined-cycle production plant that uses a Fischer-Tropsch (FT) technology to convert coal into about 30,000 barrels per day (bpd) of diesel and naphtha; significant amounts of electricity, some of which can be sold off site; and carbon dioxide, which can be sequestered or sold for use in enhanced oil recovery (EOR) off site.
The Army must transform its institutional activities to align them with operating forces to improve support and release resources from institutional activities. This document provides a model for evaluating value chains to promote the alignment of needs and resources according to three representational institutional Army activities: medical services, enlisted accessioning, and short-term acquisition.
The Defense Department, seeking methods to hold the line on enviromental costs, can look to corporations in the private sector for novel approaches to enviromental management.
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