Nanotechnology Now

Energy is the world's largest market, and one that has political and strategic impacts unmatched by any other sector. Most countries are entirely dependent for their energy needs on the finite resources of fossil fuels. Fluctuations in energy prices can bring economies to their knees, and allow otherwise less influential or developed countries to become major players in world politics.

While catalysis is as old as the chemical industry, recent advances in nanocatalysis have started an inexorable shift in both the economic and political balance of the fossil fuels market. As with other technological shifts, control of the direction and magnitude of the effects lies in the hands of the controllers and adopters of the technology. It is notable in this respect that the most advanced coal liquefaction catalytic technology is being applied in China and has US government involvement.

These technologies are still at the early stage, but interest from the US Department of Energy and the Chinese government has already allowed one small company to sign a $2 billion contract for the commercialization of its nanocatalysis technology for coal liquefaction in a remote region of China.

Developments in nanocatalysis have the potential to

• allow remote regions of the world to become self-sufficient in oil, produced locally from coal reserves

• allow stranded gas, which accounts for 80% of known gas reserves, to be economically exploited

• place a cap on oil prices, below the level desired by OPEC

• help Russia to become a significant player in the global energy market, emerging as a rival to OPEC

• allow countries with large coal reserves such as the US and China to become independent of imported oil should political or economic factors favor this

• cause the production of offshore oil to become increasingly marginal, narrowing the difference between production costs and world prices, and thus impacting the economies of major oil producers

• help shift greenhouse gas emissions from vehicles to more centralized locations, where they can be more effectively managed, and ultimately pave the way to a hydrogen economy Nanocatalysis and Fossil Fuels July 2002

• significantly reduce emissions of other pollutions such as nitrogen oxides, sulfur dioxide (the cause of acid rain) and particulate matter

• promote waste recycling through conversion of plastic, rubber, municipal waste and waste oil to clean fuel

The distribution of world coal reserves is dramatically different from world oil reserves, being concentrated in countries such as China, the US, Russia, Australia and India. Economic extraction of transportation fuel from coal could thus completely alter the balance of power in terms of world energy supplies. Russia in particular, especially with its close relationships with other countries in the former Soviet Union, looks set to benefit from any shift in power through its access to major coal and natural gas reserves.

This shift is just starting, with production of transportation fuels, particularly ultraclean diesel, from coal now economically viable for countries like China at prices in the OPEC target range of $22 to $28 a barrel, thanks to nanotechnology. A few years hence the technology will probably be viable also for the United States and other coalrich, developed countries such as Australia.

We are not about to see the bottom drop out of the oil market and a resulting crash of economies in the Middle East, but their historical power and their ability to affect the world economy through oil prices, either deliberately or through wars and political turmoil, seems destined to be significantly diminished for good.

Nor are we about to see a major improvement in emissions of greenhouse gases and other pollutants, but the new technologies do offer promise of improvement and also a stepping stone to a future hydrogen economy, with cities choked with car fumes becoming a thing of the past. This will not happen tomorrow but advances in fuel cell technology, through nanocatalysis and other nanotechnologies, show great promise of making this a reality some years down the road.

Also influencing this dynamic is the potential of exploiting the bulk of the world's gas reserves, which are currently uneconomic. There is even a distant possibility of tapping a source of methane (the main component of natural gas, and the cleanest of the fossil fuels) that could last for thousands of years, in the form of methane hydrates sitting at the bottom of our oceans.

The same technologies will allow us to turn waste—oil, plastic, rubber and domestic and factory waste—into clean fuels for our cars, trucks and airplanes.

Our dependence on fossil fuels does not look set to go away soon, but the rules of the game will change, drastically limiting their ability to throw economies and the world into turmoil and reducing, given sufficient political will, the damage they do to the environment.