Editorial: Reality of OTEC Falls Short of its Promise

posted in: Editorial, May 1991 | 0

In February 1980, the Ad Hoc Committee on the Advancement of OTEC for Hawai`i reported that people attending a legislative workshop had been told that, “by 1990, OTEC plants in Hawai`i could provide as much as 660 megawatts to O`ahu.”

On September 3, 1984, a front-page headline in the Honolulu Star-Bulletin proclaimed that the “World’s First Major OTEC Plant Is Targeted for O`ahu in 1988.” Construction on an ocean thermal energy conversion plant to generate 40 megawatts of electrical power was to commence in 1986, the article stated, with power production occurring in 1988.

Still too optimistic. But newspaper writers were as eager to believe as ever and in 1990, a banner headline on page one of the Honolulu Advertiser informed readers that “OTEC is coming on line.” A closed-cycle OTEC plant would begin producing 160 kilowatts of net power in January of 1991, the article stated.

That, too, did not materialize. But the predictions continue. Today, that part of the public not yet grown completely cynical is being told that next year, an experiment at Keahole Point, on the Big Island, will yield (for a few hours, at least) about 40 kilowatts net of electricity. (It will run for about a year, but will be producing at its peak capacity only for a short time, primarily because of cost considerations.)

From the prospect of 660 megawatts a decade ago to the current forecast of 40 kilowatts is a significant diminishment. (With one megawatt equaling 1,000 kilowatts, the 40 kilowatt output is less than one one-hundredth of a percent of the giddy prediction of 660 megawatts.)

A Great Theory

OTEC is promoted as renewable and available in virtually limitless quantities. But there are environmental problems associated with OTEC. Entrainment of plankton and other organisms in the intake pipes (which, in a 40-megawatt plant, would inhale volumes of water equivalent to the flow of the Nile River) could have damaging consequences for marine life. Chemicals used to keep machinery scrupulously clean (to maintain peak efficiency) could also have an impact on marine life in the immediate vicinity of the discharge water. Problems may occur if the discharge plume of cold water is allowed to enter the ocean at a level where the surrounding water is much warmer, causing marine life to be trapped in an undersea river of chilly, unoxygenated water.

Still, these problems can be surmounted and, in theory, OTEC could be far less environmentally damaging than almost any other conventional energy resources.

But can the theory be translated into practice? If OTEC is to be developed as a means of generating base-load commercial power, it must compete with more conventional fuels. Those fuels, however — oil, coal, uranium, and, in Hawai`i, bagasse — hold the vast advantage of being supported by an economic infrastructure (of pipelines, tankers, refineries, mines, mineral depletion allowances, sugar price supports and the like) that has not been provided to OTEC, solar, wind and other clean, renewable alternative energy sources.

Even if the playing field were level, one can reasonably doubt OTEC’s ability to compete. Although fuel costs associated with OTEC are non-existent, the up-front capital costs required by any OTEC plant are formidable. For example, construction of a kilowatt’s worth of capacity at an OTEC plant is projected to cost $18,000. By comparison, a kilowatt of capacity at an oil-or coal-fired plant costs between $100 and $300.

When 30 years’ worth of fossil fuel costs are factored into the picture, the so-called “levelized” costs of OTEC energy may, under the most optimistic scenarios, begin to approach those of fossil-fuel-derived electricity, especially if fuel costs rise. Set against this, however, is the fact that if the cost of fossil fuel rises (making OTEC comparatively more attractive), so, too, will the cost of borrowing, since interest rates are closely tied to the price of oil. Thus, even in a situation of rising fossil fuel costs, OTEC does not necessarily enjoy any economic advantage.

A Razor’s Edge on Energy

Not to be ignored either are the energy costs associated with OTEC installations. Add up the energy spent in making some of OTEC’s specialized equipment (mammoth polyethylene pipes, heat exchangers, and other systems that involve sometimes costly and energy-expensive alloys) and the energy spent in so-called “parasitic” applications (that is, the energy spent in running an OTEC plant itself) and you arrive at the total energy budget. Will an OTEC plant be able to pay it off?

There is no guarantee it will be. OTEC is acknowledged to be inherently a hugely inefficient way of generating energy. Optimally, it may be able to capture and convert into electricity about 6 percent of the total thermal energy fed into it. (For oil-burning systems, the efficiency is anywhere from 30 to 50 percent.) Because the theoretical maximum efficiency is so very low (with the practical limits lower yet), an OTEC plant would need to operate successfully over a relatively long period just to recoup the energy costs paid out in its construction, to say nothing of the capital costs in which those energy costs are embedded. The slightest reduction in efficiency at an OTEC plant would likely mean a negative energy output — where the amount of power consumed in operating it is greater than what it generates. Such reductions could easily occur if heat exchangers became covered with a film of microscopic organisms, if outflow channels became clogged, if there was the smallest leak in the vacuum chamber in an open-cycle plant, if … The contingencies are vast, and the premise of a successful OTEC operation is that none of them will arise. It is hardly believable.

Fueling Development

As appealing as OTEC is in theory, it is never likely to displace so much as a barrel of oil in societies that now enjoy the blessings of large-scale centralized electrical systems. More than economic considerations are at issue. There is the further problem that technological limitations make it unlikely that any OTEC plant will be able to generate more than about 40 megawatts of electrical power — and, given that so far generating capacities have been in the range of under 200 kilowatts, even that is a leap of faith.

OTEC can supply electrical power. It can supply freshwater. The cold seawater that will pass through an OTEC plant may be able to support mariculture and aquaculture activities. (Because of concerns over contamination of this water by trace minerals in the heat exchangers and other OTEC systems, cold-water discharges from OTEC experiments at Keahole Point have not been used for this purpose, nor, in fact, have they been used anywhere to support mariculture activities.)

Add it all up, and the result is at best a marginally competitive technology for developing some of the remotest areas of the world. But why? Given that so much of OTEC research is being done by the same parties attempting to come up with technologies, equipment, and even maps that will support the mining of minerals from the sea floor, one might well draw the conclusion that OTEC itself is being developed to pave the way for just this type of activity.

A fuller discussion of the environmental aspects of seabed mining must await another day. Still, the drive to develop OTEC needs to be considered in this light. OTEC’s only likely result will be to expand the frontiers of development to areas where fossil-fuel-based installations may have been judged impractical or uneconomical — and which have been blessedly spared contact with civilization that has proven so damaging elsewhere throughout the Pacific.

The Magic Words

In Hawai`i, the term “ocean thermal energy conversion” has acquired the power of a mantra. When it is invoked, and especially when it is paired with the phrase “high technology,” critical faculties and good sense yield to reverential awe. When this is accompanied by intimations of power and great political influence, the juggernaut is unstoppable.

This is the climate in which the Pacific International Center for High Technology Research was spawned and has flourished. Despite representations its president made to the Legislature this year, the people at the Department of Business, Economic Development and Tourism continue to have an imperfect understanding of PICHTR’s state-financed projects. At times, those projects seem to overlap projects for which PICHTR claims to be receiving outside funds. For example, the state was paying PICHTR for bathymetry studies of likely sites for OTEC development in the Pacific at the same time it reported being paid by the Japanese Ministry of Foreign Affairs to identify potential island sites for OTEC development. Apart from PICHTR’s own accounting of itself, the state has no way of knowing if its percentage share of PICHTR’s many projects is indeed being matched by other contributions. Nor can it tell whether some other party is actually paying for the projects the state is being billed for — with state money going to other, off-the-books activities.

Back to Basics

The just-signed supplemental contract between PICHTR and DBED provides for more thorough accounting to be done by a third party. This may clear the air; it will be at least September, however, before the results are in.

It is time for the state to re-examine its approach to high-technology development. Agencies established in the furtherance of this goal have proliferated in the last decade. Besides PICHTR, there are the High Technology Development Corp. (within DBED); the Office for Technology Transfer and Economic Development (at the University of Hawai`i); and the Office of Space Industry (within DBED); the Natural Energy Laboratory of Hawai`i; and the Hawai`i Natural Energy Institute. Interlocking directorships are the rule, not the exception. At times, relationships among these agencies seem far too cozy for comfort. At other times, they seem to be working at cross purposes. In any case, the state is the loser. There’s a lot of talk and a lot of travel, a lot of conferences, meetings, lunches and dinners. In the case of PICHTR, taxpayer money seems to have been used for fancy offices and first-class travel for its directors and officers.

This is not a way to attract high technology. If one looks at the areas that have been successful (notably Berkeley and Boston), the prime consideration setting them apart from all others is the quality of the work force and the solid educational and research environment in which creative thinking can flower.

As much money as Hawai`i is spending on high technology, it is spending little on the basic needs that high technology requires. Schools and teachers and basic theoretical research may not be as glamorous as the jet-setting, wheeling-dealing world of PICHTR. But if the establishment of a nurturing environment for high technology is what is sought (and there is in itself nothing wrong with that goal), there is no way around it.

Volume 1, Number 11 May 1991

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