some unpleasant facts about coal to liquids

1. It is a waste of energy. For every tonne of coal you turn into liquid you need another tonne to supply the energy for the transformation. This is energy thats just lost, it doesn't increase the energy of the fuel.

There are much more efficient ways to use the syngas generated from gasification - even to power transport. You can use it to generate electricity to power electric cars at 3 or 4 times the efficiency, or you can seperate the hydrogen and use that in fuel cell vehicles. Neither of these options are faraway distant future -the vehicles are here now and will be produced for the mass market within the time it takes to set up a commercial scale CTL project

2. It uses copious amounts of fresh water - about 4 barrels for every barrel of fuel produced. This isn't just a problem for drought stricken southern Queensland. People have been diverting streams, damming rivers and driaing aquifers for centuries and water is an issue now the whole world over. Even London is having to build a desal plant. So what do LNC propose to do about this. Build a desal plant and burn even more coal to power it? That just sounds crazy.

3. Producing fuel this way will lead to more than double the greenhouse gas emissions of petrol. There are the emissions caused during the production process that are the result of its energy intensity - some clean coal advocates believe they will be able to capture and store these at some point in the future, but currenlty there is no evidence of this. Then there are the emissions at the tailpipe. There will never be a way to capture these.

Whether you believe in climate change or not, the whole world is seeking solutions to this at the moment and we are currently planning for emissions trading. How will CTL fuel compare when it is taxed at twice the rate of petrol?

4. There is no "energy security" case for CTL. Quite the contrary - CTL is an attempt to keep us locked in to using the same type of fuels as we have been in the past. For this reason you don't hear the oil companies complaining about it and even the Saudis have a few encouraging words to say about it. What they don't want us to do is to go changing our fuel tanks and infrastructure to reduce our dependence on them.

5. It costs billions of dollars to set up a commercial CTL plant and will take years to plan and build. There is clearly money out there to be invested in alternative fuels yet when real alternatives such as hydrogen or CNG are discussed the usual argument is that the infrastructure would cost a lot to build and take too long. Surprisingly there are some countries (such as India) where the government doesn't see it that way. LNC is active in India, why don't they get behind a project that could deliver some real benefits - environmental, economic and energy security? As I mentioned before there are plenty of clean, efficient uses for syngas.

6. The commercial risks of these projects are huge. If it were possible to set one up tomorrow while oil is $140/barrel you would be raking it in. But considering the size of the investment and the time to implement it you better be sure that its the lowest cost producer. If the Saudis do decide to turn the taps back on full bore will it still stack up? How can it when its such an energy innefficient process in itself? If peak oil is a reality then we should be moving our fuel infrastructure and vehicles to a type that suits the energy sources we do have (e.g. electricity), not trying to squeeze molecules into a shape that fits into our current fuel tanks. Its just a massive diversion from the real task of trying to create clean, cheap fuels with a security of supply.