Jul 6, 2015

The science of new and old energy, part 1: fossil fuels

Energy Digital Staff
4 min
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The North American energy infrastructure is dependent upon a variety of resources including fossil fuels, nuclear and renewable energy sources. Fossil fuels contribute the largest percentage to energy production in the United States.

[Related: EIA: Renewables account for almost 10 percent of US energy in 2014]

According to data released by the U.S. Department of Energy in 2014, fossil fuels account for 69.03 percent of the nation’s energy while 8.33 percent comes from nuclear power. All renewable energy sources combined generated 9.68 percent. Each of these resources requires complex processes and machinery to convert them into accessible energy.

[Related: Canadian Carbon Capture project could allow for cleaner utilization of fossil fuels]

Continuing technological advancements play a large role in the efficiency, safety and viability of available energy resources.

Part 1: Fossil fuels

Fossil fuels include petroleum, coal and natural gas, petroleum, of course, being the primary fuel used in electricity production in the United States.


On a basic level, petroleum is obtained through the following process:

1. Drilling a hole approximately 1 meter in diameter and inserting a steel pipe. 
2. A drill bit with a pipe, or drill collar, is used to cut through the rock.
3. A drill string is attached to the bit and is extended as the well becomes deeper.
4. Once the hole is drilled, steel pipe, or casing, is inserted.

[Related: American Petroleum Institute CEO outlines 2014 priorities]

5. A drilling rig is typically employed for this process since it is equipped with all of the implements required to carry out these operations.
6. Perforations are made in the casing to allow oil to flow into the pipe from the rock.
7. The reservoir is then sealed and a smaller tube provides a pathway for the oil to the surface. If the pressure is not high enough to push the oil to the surface, a gas lift or pump jack may be used.
8. After the well is completed, an assembly of valves is affixed to the mouth to control pressure and flow.

The petroleum is then distilled at a refinery to produce gasoline, kerosene and other chemicals used in consumer products.


Coal represents about 20 percent of the energy resources used in the production of electricity in the U.S. After it is mined, coal must undergo processing prior to combustion:

[Related: Engineering possibilities vs. practical implementation: coal- and gas-fired plants]

1. First, it is crushed in a feeder breaker.
2. Large lumps travel on a conveyor and are broken up by a toothed drum.
3. Next, the coal is crushed by a sizer that ensures the largest particle size is less than 75 millimeters.
4. The coal is then screened to separate fine particles from coarser ones. Uniform particle size produces even combustion that is desired for kilns whereas coarser particles are used for grated applications.

[Related: EIA: Next two years looking strong for renewable energy growth]

5. The next step, beneficiation, is the process whereby impurities are removed from the coal.
6. The subsequent cleaning process helps separate out particles of stone since the coal is lighter.
7. The final step is charring, which removes hydrogen and oxygen, resulting in a product that consists primarily of carbon.

Natural gas

The demand for natural gas has increased significantly in recent years as it offers an abundant, low cost energy source with comparatively low greenhouse gas emissions. However, its use in electric power generation may be limited by the availability of natural gas pipeline transport systems.

[Related: [INFOGRAPHIC]: 50 years of liquid natural gas]

Natural gas is most often discovered in subterranean rock formations, usually near or in conjunction with coal beds or petroleum reservoirs. After a well is drilled and the gas is extracted, it is processed to remove impurities. 

Hydrocarbons and fluids must be removed to produce dry natural gas before it can be transported through major pipelines.

A variety of equipment is usually installed at the well to carry out these purification processes. For example, a low temperature separator is used to remove oil and condensates from natural gas and flash tank separator-condensers aid in recovering methane from the glycol dehydration process that would otherwise be released into the atmosphere.

Note: This article first appeared in the May 2015 edition of Energy Digital

Click here to read the June 2015 edition of Energy Digital


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Jul 26, 2021

Ofwat allows retailers to raise prices from April

Dominic Ellis
3 min
Ofwat confirms levels of bad debt costs across the business retail market are exceeding 2% of non-household revenue

Retailers can recover a portion of excess bad debt by temporarily increasing prices from April 2022, according to an Ofwat statement.

The regulator confirmed its view that levels of bad debt costs across the business retail market are exceeding 2% of non-household revenue, thereby allowing "a temporary increase" in the maximum prices. Adjustments to price caps will apply for a minimum of two years to reduce the step changes in price that customers might experience.

Measures introduced since March 2020 to contain the spread of Covid-19 could lead to retailers facing higher levels of customer bad debt. Retailers’ abilities to respond to this are expected to be constrained by Ofwat strengthening protections for non-household customers during Covid-19 and the presence of price caps.  

In April last year, Ofwat committed to provide additional regulatory protection if bad debt costs across the market exceeded 2% of non-household revenue. 

Georgina Mills, Business Retail Market Director at Ofwat said: “These decisions aim to protect the interests of non-household customers in the short and longer term, including from the risk of systemic Retailer failure as the business retail market continues to feel the impacts of COVID-19. By implementing market-wide adjustments to price caps, we aim to minimise any additional costs for customers in the shorter term by promoting efficiency and supporting competition.”  

There are also three areas where Ofwat has not reached definitive conclusions and is seeking further evidence and views from stakeholders:   

  1. Pooling excess bad debt costs – Ofwat proposes that the recovery of excess bad debt costs is pooled across all non-household customers, via a uniform uplift to price caps. 
  2. Keeping open the option of not pursuing a true up – For example if outturn bad debt costs are not materially higher than the 2% threshold. 
  3. Undertaking the true up – If a 'true up' is required, Ofwat has set out how it expects this to work in practice. 

Further consultation on the proposed adjustments to REC price caps can be expected by December.

Anita Dougall, CEO and Founding Partner at Sagacity, said Ofwat’s decision comes hot on the heels of Ofgem’s price cap rise in April.

"While it’s great that regulators are helping the industry deal with bad debt in the wake of the pandemic, raising prices only treats the symptoms. Instead, water companies should head upstream, using customer data to identify and rectify the causes of bad debt, stop it at source and help prevent it from occurring in the first place," she said.

"While recouping costs is a must, water companies shouldn’t just rely on the regulator. Data can help companies segment customers, identify and assist customers that are struggling financially, avoiding penalising the entire customer in tackling the cause of the issue."

United Utilities picks up pipeline award

A race-against-time plumbing job to connect four huge water pipes into the large Haweswater Aqueduct in Cumbria saw United Utilities awarded Utility Project of the Year by Pipeline Industries Guild.

The Hallbank project, near Kendal, was completed within a tight eight-day deadline, in a storm and during the second COVID lockdown last November – and with three hours to spare. Principal construction manager John Dawson said the project helped boost the resilience of water supplies across the North West.

“I think what made us stand out was the scale, the use of future technology and the fact that we were really just one team, working collaboratively for a common goal," he said.

Camus Energy secures $16m funding

Camus Energy, which provides advanced grid management technology, has secured $16 million in a Series A round, led by Park West Asset Management and joined by Congruent VenturesWave Capital and other investors, including an investor-owned utility. Camus will leverage the operating capital to expand its grid management software platform to meet growing demand from utilities across North America.

As local utilities look to save money and increase their use of clean energy by tapping into low-cost and low-carbon local resources, Camus' grid management platform provides connectivity between the utility's operations team, its grid-connected equipment and customer devices.

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