§1. Subsidies, military spinoffs, and the renewable energy industry [00:00]
Tomorrow I have jury duty. I'll find out today whether I really have jury duty, and even if I have to go in, I'll find out tomorrow whether they'll keep me. I doubt they'll keep me — after I've testified a hundred times in court, most people don't want me on a jury. We were talking about externalities before.
The last externality we talked about is "if you build it they will come" — states are saying you must have fifteen or twenty percent of your utility energy as renewable energy by 2025 or whatever. So there are all kinds of solar credits now, people are building wind turbines. The biggest one I've seen — there are probably bigger ones — is in Indiana. Driving through Northern Indiana down towards Indianapolis, from Rensselaer to Indianapolis, all of a sudden you just have wind turbines all over. But wind only works in a few places where you have consistent enough wind. And the problem with solar is it only works when the sun shines. So people are looking at all kinds of storage technologies.
These are subsidized, they're not really economical yet. If the price of oil goes back up they become very economical, but when oil is down low they're not as economical. They essentially force the utilities to raise the rates to subsidize the renewable energy. So that's an externality that has driven a whole new industry of wind turbines and photovoltaics. That helps accelerate the development of these things. What was the thing that allowed Boeing to develop commercial aircraft?
It was the US military, okay. The military was developing jets well before anyone thought of commercial jets. But because there was this huge infrastructure of the military, they were able to spin off commercial jets. One of the problems today is the two engine technologies have diverged. What the military needs is a very fast, very powerful, high-speed engine. What the commercial industry needs is a very efficient engine. The two are no longer aligned. However, the industry is large enough that they can afford to develop some of their own engines now for commercial purposes. That was one of the big fights between Airbus and the United States. When Airbus first started, the United States said foul, you're giving subsidies to this industry in Europe to build aircraft to compete with our Boeing monopoly. And the Europeans somewhat correctly said, ah, but you've been giving all this military aid to your aircraft industry. So you can have it whichever way you want, depending on whether you're European or North American.
§2. GTD-111: the patent that came back [03:46]
Another externality, and this one has to do with intellectual property. It has to do with large turbine blades. These are land-based turbines. I'll pass around — this one comes from either a 757 or 747 engine from about twenty, twenty-five years ago, maybe even older. You can take it apart. It's a single crystal turbine blade. It's been cut by wire electrical discharge machining so you can see the inside structure, and they cool these things with the compressor air from the engine. The cooling air is about 500° Fahrenheit because that's the temperature when you squeeze the air in the engine to thirty atmospheres pressure so you can burn it.
[The projector has burned out; Tom continues without it.] They cool the blades because every 50° Fahrenheit increase in operating temperature of the gas is $2 billion in fuel savings for the commercial airlines per year. So it's quite an incentive. It could cost $20 billion to develop a new aircraft or a new engine, but there are big savings to be had.
To go to higher temperatures, they ceramic-coat the blades. They started compressed-air cooling them, and they went from about 2,000° firing temperature of the gas to over 3,000°. That's above the melting temperature of the metal. If you didn't cool them, they would melt. But fortunately the cooling air is always there because it comes from the turning of the engine, so the engine doesn't get hot unless it's compressing the air. So it's actually a fairly safe technology. We've been using it for about forty years. Here's the cooling passages. They do it on land-based turbines, which is generating electricity.
And what happened is General Electric had an alloy GTD-111. This is the Larson-Miller plot, and you can look at temperatures down here versus stress, and GTD-111 goes to higher temperatures, for longer at higher stresses, than any other of the generally available superalloys that were used. The original patent expired in the mid '70s, and it was a very good alloy, so a lot of other people started using it. Turns out that back in around 1980, General Electric applied for a patent on the heat treatment. The patent was denied, and they kept reapplying, fighting with the patent office. Meanwhile a lot of other people were designing this alloy into their turbines because the patent had expired. They figured they were safe.
Well, it turns out in the mid 1990s the patent office finally decided to allow the heat treatment patent, and all these other people had billions of dollars worth of equipment out there with GTD-111 alloys, all certified by the agencies that certify land-based turbines. And they had a problem because now General Electric had a patent on this and you couldn't use it without buying it from them. If you refurbish the alloy — once it's served about ten years of service, 30,000 hours, it's no longer good for continued service because the microstructure coarsens and it no longer has the good properties — but if you could figure out a way to reprocess it and end up with the same thing, then you could reuse it, because you already bought the license when you bought the blade to begin with. It turns out there is a way to reprocess it. So by 2000 — it takes a few years for people to adjust — they found that they could use hot isostatic pressing. If you take the deformation processing or the casting lecture, you'll find out how to heat-treat things under 20,000 PSI of pressure, and you can refurbish and get the good microstructure back.
§3. Offsets and the sour-oil project that didn't happen [09:01]
Another one is offsets. Anybody familiar with offsets? It's very common in the commercial aircraft industry. Boeing or Airbus wants to sell something to Indonesia, and it's going to be a $7 billion order for new aircraft, for Indonesian Airlines or whatever. Well, as part of the deal, the Indonesians — they've got a couple hundred million people, balance of payments — they want you to build some of the components to those aircraft in their country. So if we're going to give you a $7 billion order, we want to see $500 million done in Indonesia. It's called offsets.
Well, what do you have them build? It depends on what their technology is. It's not too bad if you're selling to Japan. Mitsubishi Heavy Industries builds whole sections for Boeing aircraft — part of the fuselage — and they ship them over and Boeing sticks them together. One technology that Boeing keeps in-house is the wings. It's an important technology. And the landing gear. If you build a commercial aircraft, you start with the landing gear. You have some projection of what the weight of the aircraft is going to be, and the critical thing is that landing gear has to take the impact of landing. It can't be too heavy or you're losing payload. So you start designing the landing gear. They keep the landing gear and the wings in-house, with their proprietary advantage. But other things can go anywhere in the world — certainly the interiors, the doors.
This was one that Caroline Joseph, who took this class a couple years ago, brought back from a summer where she worked at Exxon — I think it was Exxon. She was down in Houston with an oil company, and somewhere they discovered oil but it was, I believe, sour oil. What's sour oil? Sour gas means it has hydrogen sulfide in it. Hydrogen sulfide is toxic. It numbs the nerves in the nose. It puts your nose to sleep and you just die from hydrogen sulfide poisoning. In the southwest corner of Wyoming, you go through this rangeland, they'll have signs saying H2S — they have fourteen percent H2S in the gas in the ground there. And the cows have to be very careful about what they breathe, because some of it leaks up through the ground after they drilled all these holes.
They wanted to do some stuff and they thought they were going to have to use clad pipe rather than carbon steel, and her job that summer was to figure out whether they could get away with carbon steel. But the host country, which she didn't tell me what it was, required a percentage of the work in the country, just like Boeing sells aircraft to Indonesia. In this particular host country, they required the employment of local workers. That could be Canada — Canada doesn't like US people coming across the border and stealing their jobs. Has anyone ever been through customs in Canada and had them give you a hard time about getting in? I have. Brian has. "What are you doing here, isn't there a Canadian that can do this work?" No one can do what I do, no one can screw up like I do.
They would allow managers from outside the country, but only if they had fifteen years or more experience. And not everybody with fifteen years or more experience wants to go work in Bolivia, because they have other externality problems — maybe their children are in high school and they don't want to send them to Bolivian high schools, or they don't speak Spanish. The bottom line was she did the technical assessment and found out they did require clad pipe for those conditions, but the management decision, which had nothing to do with anything technical — which is the whole point of these externalities — they canceled the project. It was too expensive with all these requirements the host country put on it. That was not a law passed in the host country for that project, but they lost a multi-billion-dollar project and the development of their own resources, because they didn't want people stealing jobs. How many million years of jobs did you kill with those restrictions? Which I'm sure they were good restrictions for other reasons.
§4. Embargoes: Rhodesian chrome and Swedish cadmium [14:12]
Another externality is embargoes. From time to time we impose embargoes on different countries. I talked about the Japanese and the oil and steel embargo trying to get them to behave in Nanking and China and not murder all the people. We thought we were doing a good thing. We have embargoes against the North Koreans. We just ended some of our embargoes against Iran. Well, back when I was in elementary school and high school, in the '60s, they had a civil war in Rhodesia — Zimbabwe now is what Rhodesia was. And it turns out Rhodesian chrome ore is the best in the world. This is sort of like the conflict diamonds. This chrome ore is so good you can basically just stick it in the furnace, you don't have to do any processing to upgrade it. It's the richest in the world. It's unmistakable in its appearance.
[Tom passes around a sample of chrome ore.] This is from a stockpile that the US had of chromite ore from Rhodesia. They put an embargo on it because the revolutionaries in Rhodesia were using this to finance their war. Well, it still passed. If you ordered chrome ore, it might have come from some other country but it just passed through that other country. It was certainly Rhodesian chrome ore — no one else had chrome ore that looked like that. And you can't fake a million tons. Why would you want to fake it? Well, they wanted to sell it. So embargoes don't always work.
§5. Transportation, comparative advantage, and copper pipe [16:07]
Another externality is transportation. One of the examples I like to give is copper pipe. We lost a lot of the manufacturing base in the United States because China and other parts of the world were underselling us on labor. It wasn't that we were less productive — the United States is the most productive country in the world when it comes to manufacturing. But it's the law of comparative advantage. The law of comparative advantage is, let's say another country can grow rice at $1.50 a bushel, we can grow it at a dollar a bushel. They can't make computers, but if they did it'd cost $10,000 for a laptop. We can make laptops for $1,000. So we're more productive on both rice and computers, but we let them grow rice and we make computers, because our markup is bigger on the computers. The comparative advantage is, even though we could grow rice cheaper than you, we'll let you have something so you can earn some money to buy our computers.
In the 1980s everybody thought Japan was beating our socks off in manufacturing. I spent my sabbatical in the mid '80s in Japan because everybody thought, wow, those Japanese make Toyotas, they certainly are doing a better job than General Motors. Well, it turns out General Motors was more productive, but the law of comparative advantage basically said we would buy Toyotas if you'll loan us the money so we can have a Star Wars Defense Initiative so we can bankrupt the Soviet Union. We had higher productivity than the Japanese but we were buying their automobiles so they could have the money. We would buy their cars, and they would loan us the money back so we could build missiles.
The law of comparative advantage with regard to copper tubing is we never lost the copper tubing business. Copper tubing is relatively easy to make if you start out with the five or six million dollar investment into an extrusion press. This is glowing red copper going in, they just squirt it out like toothpaste, very fast. We had seven plants in the United States making copper pipe. Why? Because the transportation cost of shipping all that air inside the pipe was too great. Even though we didn't have the comparative advantage in terms of labor rates, we had the advantage on transportation costs.
Gordon Forward, who was a graduate of this department and was named one of the top managers in the United States, was a Canadian who started, with a couple of other people, Chaparral Steel, a mini-mill, in the mid '70s. Some people were saying, oh, the Japanese have much more efficient steel mills. But the market for that steel was the United States, and as he used to point out, it cost $30 a ton to ship it to the United States, so as long as he could make the steel for less than $30 worth of labor per ton, "they can eat their steel," he used to say. He was going to make it here if he could beat them on the labor cost, and he did.
§6. The first English energy crisis: wood, charcoal, and 1558 [20:13]
So another transportation one, which I kind of like, goes back 400, 500 years, to England. This is a PBS series about metallurgy. It's about twenty hours of lectures on metallurgy. It talks about the first energy crisis in England. The energy crisis in England in the 1500s was they were running out of trees for energy. You would burn wood, you would take the wood, you'd pyrolyze it to make charcoal. How do you make charcoal? Anybody know how to make charcoal? Yes, exactly. You pile up the logs, you cover it with dirt, let a little bit of air in, not much, and you light it underneath the dirt and suffocate it. It burns off all the volatiles, gets all the smoke coming off, and when you're all done, you stop the air going in, put the fire out, let it cool down, take the dirt away, and you've got charcoal. Charcoal is a very clean fuel after you've burned away all the other stuff. But in any case, they were running out of fuel in England.
Here is the chapter on the revolution of necessity. "The Weald today is a broad expanse of rolling hills." The Weald — this is from a Roman map of the occupation of Britain, and this is where London would be, this is the Thames River, this is the Isle of Wight, this is the Weald. It was famous for its forests even in the days of the Romans. The White Cliffs of Dover are down here. If you get on Google, you can look at the geology of the Weald. It is a broad expanse today of gently rolling hills and vales. But once the Weald was densely forested with mature oaks, beech, and chestnut. By the 16th century, the 1500s, the Weald was dotted with blast furnaces and forges for the making of iron, so you can make cannon and other things of war, each surrounded by an expanding patch of cleared land. That's why it's rolling hills today with no trees.
The HMS Victory, Nelson's flagship at the Battle of Trafalgar, contained 2,100 tons of oak. The USS Constitution — anyone want to know why she's called Old Ironsides? Because she's made with North Carolina white oak. North Carolina white oak is one of the strongest woods in the world, and that's why the cannonballs would bounce off her sides. When they have to repair her, it takes the US Navy — she's still a commissioned ship in the US Navy, the oldest one — it takes the US Navy about twenty or thirty years to come up with enough North Carolina white oak to repair it. It's still a problem.
So there were two uses of oak that were in conflict, making ships and iron making to armor the ships. And then a third industry was added to these pressures, glass making. In 1558 a law was passed forbidding the felling of trees to make coals for the burning of iron, but the Weald of Kent and Sussex was exempted. Typical politicians — even then, the thing they're trying to regulate, they exempt because of all the lobbyists. By 1581 the shortage of wood for shipbuilding was so serious that a further act was passed forbidding the felling of trees within twenty-two miles of the Thames, within four miles of the great forest of the Weald, and within three miles of the coastline anywhere, because you had to get these big timbers for the masts to the sea. By 1615 — now we're getting into when they settled America — England was facing an energy crisis. "At last that country is forced to turn to the source of fuel England, which had been known for centuries but which few had chosen to use," and that was coal. And that's where British coal mining started.
But in the meantime, they had landed over here in North America, and they found all kinds of forest. This is the Saugus Ironworks. You go up to Saugus, Massachusetts, about forty minutes away — they have a National Historical Park, and this is the Saugus Ironworks. It was around 1619, it operated till about 1632. This is the inside. You can take a tour. And it's here because you didn't have trees you could use in England. Down here — anybody been to Jamestown, Virginia, also one of the first colonies? In Jamestown, they have a glass factory. They have the Jamestown glassworks. This is the recreation of the glassworks, very similar to what we have in the basement of Building 4. They could have come here rather than going to Jamestown, but it was a transportation problem of how to get coal.
§7. Plastic bags and the cadmium reversal [26:08]
So that's it for externalities. Did anyone come up with an externality of their own? I told you to think of externalities. Did you think of any externality for materials?
Student: Cambridge recently banned the plastic bags at grocery stores. Now everyone uses plastic bags that are way more sturdy because they aren't banned, but it seems to be kind of like worse than the original.
In fact, I always ask for paper when I go to the grocery store. One, the plastic bags are cheap and they break. But the real reason is I have to take my newspapers and wrap them in twine to throw them away for recycling in my town. If I have a paper grocery bag I can stick them in there and put those out. So I'm saving myself the cost and time of twine. But this whole question of bags is an interesting one, because there was a study about twenty, twenty-five years ago in Science magazine of which is more energy effective, plastic bags or paper bags. Plastic bags of course have the long-term problem of choking birds or fish in the sea. They never degrade. Paper bags, they can just landfill, or they can burn, and they get the energy content back that way. But harvesting those trees and making the paper — if you look at the whole life cycle cost, it's sort of neck and neck between paper and plastic. And it depends to a certain extent on the cost of oil. But that's a good example. We regulate things because we're concerned about them.
Other regulations: a number of years ago people in Sweden decided that cadmium was a toxic metal, and they wanted to ban it from the environment. There's about a tenth of a percent cadmium in the silver contacts in every light switch — that fifteen or twenty amp light switch on the wall, that you turn on the lights with — it's got a little bit of cadmium oxide in it. Because otherwise it would be a seven amp switch. Without a little bit of cadmium oxide you get arcs. With a little bit of cadmium oxide it suppresses the arcing, and you can get twenty amps out of that same silver contact. You go to the store and you buy this little cheap switch for $2 — you ought to buy the one for $10, the better quality one — but nonetheless, you can buy them. The Swedes decided cadmium's toxic. Well, the amount of cadmium vapor that comes off whenever you don't get an arc in a cadmium switch is so small that I don't think anyone in Sweden was dying. Someone could calculate some death rate from cadmium vapors. If you've got fifty million people in Sweden, I guess one person would die every thousand years. But within one or two years, they were burning down so many houses, they decided they could use cadmium. They reversed themselves.
Europeans were doing something else more recently. One time, twenty years ago, my old thesis advisor walks into my office. He had a copy of the periodic table and he had X-ed out chlorine, because the Norwegians had decided that chlorine was a bad actor in the environment, and they were going to eliminate chlorine from the environment. How are you going to do that when the oceans are full of three-and-a-half percent chlorine? We just get rid of the oceans, right? Once Congress was about to pass a law — someone stopped them — but they were going to ban any material that would destroy DNA. One of the most potent materials for destroying DNA is called oxygen. Under this law, Congress would have banned oxygen. You know what, we wouldn't have had to worry about any environmental problems from then on — we'd all be dead. This is what happens when non-scientists try to dabble in science.
§8. Cost and availability: oil reserves and the four classes of materials [30:39]
So we're going to talk about cost and availability. We've done externalities. This is one of Professor Sway's [Szekely's] Russian jokes he used to tell me. I kind of like Soviet humor. "How much is that doll on the shelf?" "500 rubles, come back tomorrow." "They don't have it next door, but it's only 300 rubles." "Come back. When we don't have it, I'll give it to you for 300." Another Soviet joke is, there's no truth in Pravda and there's no — what's Izvestia mean, anyway? Pravda means truth, and one was the news magazine, the other was the newspaper in the former Soviet Union. Pravda means truth and I can't remember what Izvestia means, but there's no truth in Pravda and there's no whatever Izvestia means in Izvestia.
We talked about this before — cost and availability. The fact that we prospect for oil until we have a twenty-year supply. This is a breakdown, and you'll have this on Stellar if you're interested. In North America, we're well behind a number of other places in proven reserves. Namely the Middle East — their proven reserves are a very large fraction of their potential reserves. That's because they drilled for oil in Saudi Arabia back in the 1920s and they struck it rich. It just flows, with very low extraction cost on the order of $5 a barrel or less to pump it out of the ground. South America — most of it because of Venezuela, they have unconventional oil reserves underneath the Orinoco River. In North America, a lot of our reserves are up in the tar sands in Alberta. Asia and the Pacific don't have a whole lot of reserves in terms of oil. But we prospect for oil until we find a twenty-year supply and then we decide that we have enough oil but it's going to run out in twenty years, and we've been saying that for a hundred years.
This is a plot of the materials that we use over time. We'll get back to cost in a little bit. This comes from Professor Mike Ashby, who was at Harvard. About 1980 he published a book called Engineering Materials in which he had this plot. It's a very nonlinear axis from 10,000 BC up through the Christian era, then going up by 500 years, 100 years, twenty years. He published this about 1980. In 2011 he published it in color, and in 2012 he no longer has this plot. There are lots of problems with this plot, aside from the nonlinear axis. But basically what he was trying to show is that we have four classes of structural materials: metals, polymers, composites, and ceramics and glasses. In the old days, the metals were gold, copper, tin, and bronze. Polymers were wood, skins, and fibers. Composites were bricks made out of straw and clay, and paper. Ceramics and glasses — stone, flint, pottery, glass. And then here we have higher-tech materials, but it's still other things.
In 1970 when I graduated from this department, seventy-five percent of the faculty were metallurgists. It was the Department of Metallurgy and Material Science. Right before I graduated, they changed it to the Department of Material Science and Engineering. It started out in 1865 as the Department of Geology. Metallurgy didn't even exist until the 1880s, and that was because of Andrew Carnegie and steel. It was the Geology department, then became the Metallurgy department, and then around 1970 or so, it added Material Science to the name. Now it's Material Science and Engineering. Ashby was predicting, as everyone else was, a decrease in the amount of metals that were used. This was 1980, and I gave a talk down at NIST one time in the mid '80s, when everybody had said ceramics was going to take over the world. I thought, well, not for structural materials. Although we do use more ceramics for structural materials than anything else, but not for really important structural materials, which is what this class is supposed to be about. It turns out the reason is, ceramics have no ductility. They're brittle.
I remember getting up in the big lecture hall at NIST at this conference. I was starting a talk — I think you have the paper that came out of that eventually, called "The Future of Metals." I was so sick of hearing everybody talk about how ceramics were going to take over the world that I ended up writing this paper on the future of metals in the early 1990s. I sort of became a poster child for the American Iron and Steel Institute. I was the first person ever to give a talk at US Steel Research Labs that wasn't from US Steel, talking about steel as an important material. I had to go there to convince them. A couple years later, I had to go to the AISI annual meeting — this is all the CEOs of all the steel companies in the United States — and give them a talk on why steel was important. It was a beautiful resort down in Orlando, a gated community. I'd never seen a place like that before. And I thought, I have to come and tell the CEOs of steel companies why steel is important — there's something wrong with this picture. But metals are important and they have not lost their importance, and we're going to talk about that in this class.
§9. Element abundance and the beryllium story [37:18]
So as far as what's available — this is element abundance per million silicon atoms, normalized to a million silicon atoms right here. Oxygen is the only thing above that. These are rock-forming elements. Here are the rare earths, and the rare earths aren't really so rare. The rarest metals — gold and platinum and osmium and iridium — I made my wife's engagement ring out of platinum-iridium. These are fairly rare. The astrophysicists like to look at iridium because there's more of it in interstellar space, and they can tell if it came from meteorites. So this is the concentration of what's available. We have lots of iron, fair amount of titanium, lots of aluminum.
But that's not really the most important part — availability is, but cost matters too. The abundance in the crust: silicon is right behind oxygen, a lot of the minerals are silicates, aluminum is a very large amount, iron is high. Where are these elements made? How did nature make these elements? At the time of the Big Bang, everything was hydrogen and helium and maybe a little lithium. All these were made in supernova explosions. That's where you get the heavy elements. Remember, the core of the earth is iron. That all took a few billion years to have enough stars die to have supernova explosions and start creating these heavy elements. Iron is abundant because its nucleus is the most stable nucleus on the whole periodic table. These others tend to be more reactive.
[Tom passes around a sample of beryllium.] You can see beryllium is an interesting material. It's fairly abundant but we don't use it a lot. Anybody know why we don't use it? Brittle? No, it's not actually that brittle, it's actually fairly ductile. This is a piece of beryllium, cost me $130. Typically beryllium will go for $1,000 an ounce or so. It's very toxic. It's not toxic to touch. The toxicity is if you breathe in particles, whether they're beryllium oxide, sulfide, or metal. It was all discovered up here on the corner of Mass Ave and Vassar — I think it's near where that Bank of America is. During World War II, in the Manhattan Project, there were some people at MIT machining beryllium for the Manhattan Project. It was a fairly new metal, and some of them got berylliosis. If you get the particles in your lungs by breathing them in, ten percent of the people in the world have a genetic predisposition to form these nodules on your lungs. There is no cure. You just basically suffocate over time. The first people ever to have this disease were a couple MIT machinists. They just shut the building down because it was full of powdered beryllium. They supposedly eventually encased everything in concrete and buried it in Boston Harbor. That's the story I've heard. That was sixty years ago and that was okay back then, environmentally. And actually, if you encase it in concrete, it lasts forever in the ocean. No one's going to be breathing those particles anytime soon.
§10. The Westbrook plot: cost-versus-use and energy density [41:22]
So there are the minerals. This particular plot is from Jack Westbrook, who was a graduate of this department back in the '50s, went to General Electric in the early '60s. He developed this plot as part of an internal General Electric strategic planning exercise. This is structural materials uses versus cost on a very log scale. Three orders of magnitude on this axis, and across here about six or seven. These dashed lines are iso-market-size lines, so that in 1962 that was a billion-dollar market. I actually have someone who's supposed to be updating this for today. The most used material and the cheapest — you could get ten pounds of stone back then for a penny. Now it costs a little bit more. Diamond was the most expensive. It is a structural material — we use it as an abrasive. In fact we use more diamond as an abrasive than we do for jewelry. It was $10,000 a pound. It's more expensive than that now.
Here's the trend line for lots and lots of structural materials. Carbon steel, alloy steel, wood, cement, brick, aluminum, clay tile, cemented carbides — a lot of different materials. The slope of this line is about four to one, whereas this other dashed line is one to one. What does that mean? It means if I could drop the price of a structural material by a factor of two, I would double the market size over the long run. It won't happen overnight. But if I could come up with a way to drop the price by a factor of two, I should, with a slope of four, in the long run end up with double the market. So there is an advantage to reducing cost of materials, and we're going to talk about how to reduce cost of some of these things later.
One of the things that controls cost is the energy density. This is mega per liter versus mega per kilogram. Liquid hydrogen and hydrogen gas way up here. The density varies by a factor of ten up here. Here are your lithium ion batteries. They're not really so hot when we talk about energy storage and density. But aluminum is way up here. Iron is here, and there are all kinds of other things in between. That's why aluminum is often called canned electricity. It has extremely high energy content.
§11. Coal: Wyoming, China, and aluminum as exported electricity [44:26]
It turns out energy is a commodity. This is coal, oil, and natural gas in metric tons equivalent. The United States has a tremendous amount of coal. What's the biggest coal mining area of the United States? What state has the most? West Virginia has the best quality coal, in that it's good for making steel. But most of the coal, when times are good, comes from Wyoming. Wyoming has coal mines where you have a hundred feet of dirt in northeastern Wyoming, and then you get to the coal seam.
Student: [Describing Wyoming coal fields:] They look like really big valleys, and you can kind of look up and see that they expand for maybe like hundreds of miles.
Yeah, it's just a big scar into the earth, really deep. There are no rivers up there to speak of, so it's good for mining. You can take off the top 100 feet of dirt, and then you have a 200-foot coal seam. Now in West Virginia, you look on the side of the mountains and you'll see a 3-foot or 4-foot or 6-foot coal seam, where they've blasted stuff. But in Wyoming, it's 200 feet deep. It's sub-bituminous coal, not as good as the bituminous and anthracite coal in West Virginia, in terms of how old it is and how dense its energy is. It has a lot of water content. When I was there in the mid '80s, you could get it for $5 a ton. But you had to take it out of there by train, and you might be taking thirty percent of your weight as water. So there's a big deal about how to dewater that coal. Nonetheless, we have tremendous coal reserves.
China has huge coal reserves. Because they have no rivers there, they can take the 100 feet of dirt off — they have a big valley there — and they'll come in with the largest dump trucks in the world, the largest shovels in the world, and the mine face may be two miles long. They have about fifteen of these mines, owned by people like Exxon Mobil, big energy companies. They're all closing down now because the energy price is down. This was good for generating electricity, steam coal. They have to put the land back to exactly the same contours, but it's about 200 feet lower. It's exactly the same on both sides of the mine, but 200 feet lower because they took the coal out. Actually the grass is greener on the new part because they seeded it.
Russia, being eight billion square miles, has got a lot of coal. China has a tremendous amount. If you look at aluminum production in the world in recent years, you'll see China has increased by two and a half times in six years. The price of aluminum has dropped dramatically. And this is my take on this: China is overproducing aluminum as a means of exporting coal. When the former Soviet Union first started to open up in the early 1990s, they started dumping aluminum on the world market, and it just destroyed the profitability of Alcoa and Alcan and all the other aluminum producers around the world, because they dropped their price by a factor of three. That's because they were producing their aluminum in Siberia where they had lots of energy, and they were producing it for their own use. When they joined the world economy, they wanted to get capital, and the only way to get capital — because they didn't have the pipelines to get the oil and gas to market — they would produce aluminum and ship the aluminum. It's canned electricity. The Chinese right now are doing the same thing. It's their way of exporting all their coal. We're having another shock to the aluminum market. Other producers that are using hydroelectric power are going by the wayside because they just can't afford to compete with the Chinese dumping their aluminum on the world market, because that's the way they're going to get their capital. Okay. Tomorrow Dr. Belmar will be here. I'll be at jury duty unless I get excused.