Download Environmental and economical effects of fossil fuels

Journal of Recent Research in Engineering and Technology
ISSN (Online): 2349 –2252, ISSN (Print):2349 –2260
Volume 1 Issue7 Nov 2014
Environmental and economical effects of fossil fuels
Nivedita Patel ,
Assistant Professor-II , Samanta Chandra Sekhar Institute Of Technology And Management
Abstract
Fossil fuel which includes coal, oil and natural gas are the main source of heat
and electricity energy. The importance of fossil fuels in supplying the energy
requirements of the future and the impact of their use on environment and
economy is presented. Growing concerns over the consequences of climate
change may severely limit future access to fossil fuels. A forced choice between
energy and environment could precipitate a major economic crisis, an
environmental crisis, or both. Forestalling such a crisis will be difficult, because
fossil energy resources are an essential part of the world’s energy supply and
climate change is mainly driven by the build-up of carbon dioxide in the
atmosphere. Carbon dioxide (CO2) is the unavoidable product of fossil fuel
consumption. Therefore, the use of fossil fuels collides directly with global
environmental concerns. Also, scarcities of fossil fuels and increasing oil prices
have a strong effect on economic growth of the country. It is concluded that
even with substantial increases in energy derived from other sources, fossil fuels
will remain a major energy source for much of the 21st century and the seizure
of CO2 will be an increasingly important requirement.
Keywords: fossil fuel, environment, economic effects
Introduction
Fossil
fuels are fuels formed
by
natural processes such as anaerobic
decomposition of
buried
dead organisms and formed in the
geological past from the remains of
living organisms [1]. The age of the
organisms and their resulting fossil
fuels is typically millions of years,
and sometimes exceeds 650 million
years. Fossil fuels principally consist
of carbon and hydrogen bonds.
Strictly speaking, fossil fuels are a
renewable resource [2]. They are
continually being formed via natural
processes as plants and animals die
and then decompose and become
trapped beneath sediment. However,
fossil fuels are generally considered to
be non-renewable resources because
they take millions of years to form,
and known viable reserves are being
depleted much faster than new ones
are being made. There are three types
of fossil fuels which can all be used
for energy provision; coal, oil and
natural gas.
Coal is a solid fossil fuel formed over
millions of years by decay of land
vegetation.
When
layers
are
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Journal of Recent Research in Engineering and Technology
ISSN (Online): 2349 –2252, ISSN (Print):2349 –2260
Volume 1 Issue7 Nov 2014
compacted and heated over time,
deposits are turned into coal. Coal is
quite abundant compared to the other
two fossil fuels. China and India are
major users of coal for energy
provision. Coal causes asthma and
other health problems, destroys the
environment, and releases toxic
mercury into communities. Because
of its high carbon content, coal emits
more CO2 than any other fossil fuel
when its burns. It is also the main
source of fuel for electricity
worldwide and number one human
caused contributor to greenhouse gas
emissions in the atmosphere.
Oil is a liquid fossil fuel that is
formed from the remains of marine
micro organisms deposited on the sea
floor. After millions of years the
deposits end up in rock and sediment
where oil is trapped in small spaces. It
can be extracted by large drilling
platforms. Oil is the most widely used
fossil fuel. Crude oil consists of many
different organic compounds which
are transformed to products in a
refining process. It is applied in cars,
jets, roads and roofs and many others.
Oil cannot be found everywhere on
earth and consequentially, there have
been wars on oil supplies. A wellknown example is the Gulf War of
1991.
The
most
obvious
environmental impact from the oil and
gas industry is the burning of oil,
which releases several smog- causing
pollutants and greenhouse gases that
contribute to global warming.
However, the act of exploration and
drilling for oil and gas also poses a
major threat to fragile ecosystems
throughout the world. Oil may end
up in soil or water in raw form, for
example during oil spills or wars. This
has caused many natural disasters in
the past.
Natural gas is a gaseous fossil fuel
that is versatile, abundant and
relatively clean compared to coal and
oil. Like oil, it is formed from the
remains of marine micro organisms. It
is a relatively new type of energy
source. Until 1999, more coal was
used than natural gas. Natural gas has
now overtaken coal in developed
countries. However, people are afraid
that like oil, natural gas supplies will
run out. Some scientists have even
predicted this might happen by the
middle or end of the 21st century.
Natural gas mainly consists of
methane (CH4). It is highly
compressed in small volumes at large
depths in the earth. Like oil, it is
brought to the surface by drilling.
Natural gas reserves are more evenly
distributed around the globe than oil
supplies.
Developing
countries
with
tremendous economic growth, its
energy demand is also getting
increased. Of this energy, about 70%
is supplied from fossil fuels and the
remaining 30% is from renewable
sources
[3].
Most people would agree that the
energy industry, particularly the oil
industry, played a major role in
providing the fuels that powered the
engine of industrialization.
By
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Journal of Recent Research in Engineering and Technology
ISSN (Online): 2349 –2252, ISSN (Print):2349 –2260
Volume 1 Issue7 Nov 2014
continuing this trend, however, we
might be short of oil and gas before
the 21st century.
Currently oil is the fastest primary
energy source in the world (39% of
world energy consumption). Coal will
be a major source of energy for the
world for the foreseeable future (24%
of world energy consumption). In
2030, coal covers 45% of world
energy needs. Natural gas is expected
to be the fastest growing component
of world energy consumption (23% of
world energy consumption). Figure 1
shows the World energy consumption
and Figure 2 shows the World energy
consumption by fuel type.
Figure 1 World energy consumption,
1990-2040 (quadrillion Btu)
Figure 2 World energy consumption
by fuel type, 1990-2040 (quadrillion
Btu)
Furthermore, industrialization has
brought the recognition that the
environment is fragile. Concerns
about global warming due to
excessive carbon dioxide emissions
and about the other unhealthy
pollutants in air, water, and soil are
now subjects of discussion by the
World Environmental Organization.
Fossil fuel extraction and conversion
to usable energy has several
environmental impacts. They could be
a major contributor to global warming
and greenhouse gases and a cause of
acid rain; therefore, expensive air
pollution controls are required [4].
Besides
resulting
in booming
industrial production, also led to
higher levels of energy consumption,
imports, air and water pollution, and
greater risks to the country's
environment.
Protection of the global environment
and economic development are
closely entangled. These seemingly
contradictory
needs
present
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Journal of Recent Research in Engineering and Technology
ISSN (Online): 2349 –2252, ISSN (Print):2349 –2260
Volume 1 Issue7 Nov 2014
challenges to every country to pursue
the improvement of its citizens’
livelihoods while minimizing damage
to the environment. The challenges
involve educational, social, financial,
economic, national, and international
issues, in addition to the technical
challenges to the energy industry in
the 21st century.
2.
Environmental
Fossil Use
effects
of
Many of the environmental problems
the world faces today result from our
fossil fuel dependence. These impacts
include global warming, air quality
deterioration, oil spills, and acid rain.
2.1.
Global Warming
The burning of fossil fuels produces
heat-trapping gases that are the main
cause of the ongoing rise in global
atmospheric temperatures. The largest
emissions are caused by coal
combustion. Currently, oil burning is
responsible for about 30% of all
carbon dioxide emissions to air.
Natural gas does not release as much
carbon dioxide because of its methane
structure. The burning of fossil fuels
produces
around
21.3
billion tonnes of carbon dioxide (CO2)
per year, but it is estimated that
natural processes can only absorb
about half of that amount, so there is a
net increase of 10.65 billion tonnes of
atmospheric carbon dioxide per
year. Carbon dioxide is one of
the greenhouse
gases that
enhances radiative
forcing and
contributes
to global
warming,
causing
the average
surface
temperature of the Earth to rise in
response, which the vast majority of
climate scientists agree will cause
major adverse effects [5]. Over the
last 150 years, burning fossil fuels has
resulted in more than a 25 percent
increase in the amount of carbon
dioxide
in
our
atmosphere.
Traditionally conservative World
Bank believes that human economies
may not be able to adapt to a world
that has on average warmed four
degrees Celsius or more. Note that the
global temperature has risen nearly
one degree Fahrenheit since 1975. A
global movement towards the
generation of renewable energy is
therefore under way to help reduce
global greenhouse gas emissions.
Figure 3. World energy-related
carbon dioxide emissions by fuel
type, 1990-2040 (billion metric tons)
2.2
Air Pollution
Clean air is essential to life and good
health. Combustion of fossil fuels
also produces other air pollutants,
Jrret.com
Journal of Recent Research in Engineering and Technology
ISSN (Online): 2349 –2252, ISSN (Print):2349 –2260
Volume 1 Issue7 Nov 2014
such as carbon monoxide, nitrogen
oxides, sulphur
dioxide, hydrocarbons,
volatile
organic compounds and heavy metals.
Carbon monoxide is a gas formed as a
by-product during the incomplete
combustion of all fossil fuels.
Exposure to carbon monoxide can
cause headaches and place additional
stress on people with heart disease.
Cars and trucks are the primary
source of carbon monoxide emissions.
Oxides of Nitrogen are formed due to
combustion. They can irritate the
lungs,
cause
bronchitis
and
pneumonia, and decrease resistance to
respiratory infections. Sulphur oxides
are produced by the oxidization of the
available sulphur in a fuel. Utilities
that use coal to generate electricity
produce two-thirds of the nation's
sulphur dioxide emissions. Nitrogen
oxides and sulphur oxides are
important constituents of acid rain.
These gases combine with water
vapour in clouds to form sulphuric
and nitric acids, which become part of
rain and snow. As the acids
accumulate, lakes and rivers become
too acidic for plant and animal life.
Hydrocarbons are a broad class of
pollutants made up of hundreds of
specific compounds containing carbon
and hydrogen. Hydrocarbons are
emitted from human-made sources
such as auto and truck exhaust,
evaporation of gasoline and solvents,
and petroleum refining.
Oil refineries also have negative
environmental impacts, including air
and water pollution.
Production,
transportation, and use of oil can
cause water pollution. Oil spills, for
example, leave waterways and their
surrounding shores uninhabitable for
some time. Such spills often result in
the loss of plant and animal life.
Harvesting,
processing,
and
distributing fossil fuels can also create
environmental
concerns.
Coal
mining methods,
particularly
mountain top removal and strip
mining, have negative environmental
impacts, and offshore oil drilling
poses
a
hazard
to
aquatic
organisms.
Transportation of coal
requires the use of diesel-powered
locomotives, while crude oil is
typically transported by tanker ships,
each of which requires the
combustion of additional fossil fuels.
3
ECONOMICAL
OF FOSSIL FUELS
EFFECTS
Fossil
fuels
are
economically
becoming sub prime because:
3.1
Volatile prices of fossil fuels
The price of oil and other fossil fuels
has, at least since World War II, been
the main control knob permitting
expansion and causing contraction of
world economies. It’s widely known
that 10 of the last 11 major recessions
were preceded by peaks in oil prices.
Economic
productivity
requires
energy. Much of the energy that
drives the economy comes from oil,
natural gas and coal. The main benefit
of these energy sources is that they
are relatively inexpensive. The cost of
Jrret.com
Journal of Recent Research in Engineering and Technology
ISSN (Online): 2349 –2252, ISSN (Print):2349 –2260
Volume 1 Issue7 Nov 2014
fossil fuels makes electricity and fuel
for driving, for example, available on
a broad scale. The low cost also
means a lower production cost for the
factories and other businesses that
produce the goods and services
consumed by households. Low prices
of inputs, such as energy, help keep
retail prices down for consumers.
However, the volatility of energy
prices, coupled with the fact that
fossil fuels are non-renewable energy
sources, means that price spikes for
any of these sources, such as oil,
adding to the costs of almost
everything from transportation to
fertilizers to plastics, and they
therefore cause demand for all these
affected items to become depressed,
slowing economic production. Table
1 shows the predictions and history of
oil prices between 2010-2040 [6].
Renewable, relying as they do on free
fuels like sunlight, present no such
economic pressures, and as they
become an ever larger percentage of
our energy mix, fossil fuels’ huge
GDP drag will begin to disappear.
Table 1 Brent crude oil prices in three
cases, 2010 – 2040 (2011 dollars per
barrel)
Year Reference Low High
Oil
Oil
Price Price
2010
81
81
81
2015
96
79
134
2020
106
69
155
2025
117
70
173
2030
130
72
192
2035
145
73
213
2040
163
75
237
World energy consumption is
growing about 2.3% per year.
Presently, fossil fuels are highly
efficient and cheaper than any type of
reasonable alternative we now know.
Some environmental scientists predict
that fossil fuel prices will increase in
the coming century because of
scarcity. This may cause an eventual
transfer to renewable energy sources.
In just the last five years, solar
photovoltaic module prices have
fallen 80 percent and wind turbines
have become 29 percent less
expensive. Moreover, after the initial
investment, renewable energy sources
such as wind and solar, having no cost
of fuel, will prove far too competitive
for fossil fuels no matter how cheap
those may appear to be. Cheap fuel is
still more than free fuel.
3.2
Hidden Cost of Fossil Fuels
Fossil fuels are the primary source of
energy. The costs of using these fuels
are obvious, such as the cost of labour
to mine for coal or drill for oil, of
labour and materials to build energygenerating
plants,
and
of
transportation of coal and oil to the
plants. These costs are included in our
electricity bills or in the purchase
price of gasoline for cars. But some
energy costs are not included in
consumer utility or gas bills, nor are
they paid for by the companies that
produce or sell the energy. These
include human health problems
caused by air pollution from the
burning of coal and oil; damage to
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Journal of Recent Research in Engineering and Technology
ISSN (Online): 2349 –2252, ISSN (Print):2349 –2260
Volume 1 Issue7 Nov 2014
land from coal mining and to miners
from
black
lung
disease;
environmental degradation caused by
global warming, acid rain, and water
pollution; and national security costs,
such as protecting foreign sources of
oil.
Since such costs are indirect and
difficult to determine, they have
traditionally remained external to the
energy pricing system, and are thus
often referred to as externalities. And
since the producers and the users of
energy do not pay for these costs,
society as a whole must pay for them.
But this pricing system masks the true
costs of fossil fuels and results in
damage to human health, the
environment, and the economy.
Externalities can be positive or
negative. A chief drawback to fossil
fuels is the amount of pollution they
create. Pollution is a classic example
in economics textbooks of a negative
externality. Pollution affects the
health and quality of life of all people
and leads to costly regulations
designed to limit pollution. These
controls represent a production cost,
which firms pass on to consumers in
the form of higher prices for goods
and services.
Fossil fuels companies have never had
to pay for their economic externalities
such as pollution, warming, health
effects and contaminated water and
farmland. There are signs that this is
beginning to change, and firms will
increasingly be liable for damages in
the tens if not hundreds of billions.
The highest profile example is BP’s
Deepwater Horizon spill, the worst oil
spill in U.S. history. BP has already
been required to set up a US$20
billion fund to cover cleanup and
damage costs, and perhaps far more
significantly, is facing potentially
―tens of billions‖. Other firms facing
liability issues surrounding the
dangerous nature of their products
include Chevron, which has had to
abandon Ecuador altogether to avoid
paying a $US19 billion settlement
there in a ―nightmare case‖ that
threatens to drag on around the world
as Ecuador seeks payment via
Chevron’s assets in other nations.
3.2
Carbon taxes on fossil fuels.
There will be carbon taxes in many if
not most countries that will directly
impact the profit margins of fossil
fuels firms. A carbon tax is good for
everyone but fossil fuels companies,
who will see their profits reduced (or
attempt to pass the costs on to
consumers, reducing demand for their
products further). So far, several
nations, provinces and individual
municipalities have implemented a
carbon tax, and many others have
carbon trading schemes. Carbon taxes
can raise revenues, shrink deficits,
and move tax burden away from
citizens, all while slowing the worst
effects of warming. Look for their
implementations to continue to
spread. All this is happening now,
today, with today’s technologies and
today’s economics. That the smart
money already sees renewable
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energies as more competitive long
term than fossil fuels is obvious. This
aims to make fossil fuels more
expensive, thereby reducing their use
and the amount of pollution
associated with them, along with
raising the funds necessary to
counteract
these
factors.
Environmental regulation uses
a
variety of approaches to limit these
emissions, such as command-andcontrol (which mandates the amount
of pollution or the technology used),
economic incentives, or voluntary
programs. Under regulations issued
in 2005, coal-fired power plants will
need to reduce their emissions by 70
percent by 2018.
As
we
have
previously
discussed, carbon is a huge but
usually overlooked fossil fuel subsidy,
due to the aforementioned damage it
causes via climate change.
In
countries which don't put a price on
carbon emissions, those costs are not
paid by the producers or consumers of
the products causing the damage, but
somebody pays the price. This is also
known as an economic externality,
when the cost is paid outside the
economic system rather than being
reflected
in
the
market
price. Unfortunately, in the case of
carbon, those external costs tend to
fall disproportionately on poorer
countries which contribute the least to
the climate change problem.
The
social cost of carbon is an estimate of
the direct effects of carbon emissions
on the economy, and takes into
consideration such factors as net
agricultural productivity loss, human
health effects, and property damages
from sea level rise, and changes
in ecosystem services.
It's the
economic
damage
caused
by CO2 via climate change.
3.3
Subsidies on fossil fuels
Overall cost of fossil fuel subsidies
becomes over $4 trillion per year,
over 6% of global GDP.
The
IMF overall estimate is $1.4 trillion in
global indirect fossil fuel subsidies
per year. The bulk of direct + indirect
subsidies goes to petroleum products
($879 billion per year, or 46%),
followed by coal ($539 billion, 28%),
natural gas ($299 billion, 16%), and
electricity ($179 billion, 9%). The
world subsidized fossil fuel use by
over $1.9 trillion in 2011 — or eight
percent of global government
revenues, representing a huge drag on
economies. The United States
taxpayer is fossil fuels’ largest
benefactor at $502 billion in 2011.
China came in second at $279 billion,
and Russia was third at $116 billion.
For perspective, that $502 billion is
just over 3% of the US economy,
currently being given away to big
fossil fuels companies.
The IMF report also examined the
effects of eliminating these subsidies
and found they would be substantial.
"The results suggest that this reform
would reduce CO2 emissions by 4½
billion tons, representing a 13 percent
decrease
in
global
energyrelated CO2emissions.
Eliminating
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Journal of Recent Research in Engineering and Technology
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Volume 1 Issue7 Nov 2014
subsidies would also generate
significant health benefits by reducing
local pollution from fossil fuels in the
form of SO2 and other pollutants. In
particular, this reform would result in
a reduction of 10 million tons
in SO2 emissions and a 13 percent
reduction in other local pollutants."
The IMF concluded that the ―link
between subsidies, consumption of
energy, and climate change has added
a new dimension to the debate on
energy subsidies.‖
The IMF’s
solution to both economic and climate
risk is in two simple parts: ―end fossil
fuel subsidies and tax carbon.‖ The
solution to both climate and economy
is worldwide conversion from fossil
fuels to renewable.
Electricity subsidies are included
because
they
increase
the
consumption of coal and natural gas.
In many of these countries, direct
fossil fuel subsidies amount to over
5% of GDP. Phasing out those
subsidies would have to be done
gradually and carefully, but the
money could be much better spent in
other areas to benefit the countries'
populaces, and the report estimates
that global carbon emissions would
fall by up to 2% if these direct
subsidies were scrapped.
The
renewable energy industry is a spend
thrift
by
comparison.
The
International
Energy
Agency
(IEA) estimates
that
in
2011
renewable received around $88 billion
in subsidies, and even this figure
excludes the positive externalities
(e.g., pollution avoided) that clean
energy provides.
In fact, when
analysts calculated the historical cost
of subsidies on an inflation-adjusted
basis, they discovered that fossil fuel
subsidies produced just one-tenth the
energy per dollar spent when
compared to subsidies for renewable.
4
Future of fossil fuels
You will never see cheap gasoline
again. You will probably never see
cheap energy again. Oil, natural gas
and coal are set to peak and go into
decline within the next decade, and no
technology can change that. After
over a century of continual growth,
global conventional crude
oil
production topped out in 2005 at just
over 74 million barrels per day and
has remained at that level ever since.
Oil production is expected to go into
terminal decline around 2012. The
principal reason is that the largest and
most productive fields are becoming
depleted while new discoveries have
been progressively smaller and of
lesser quality. Discovery of new oil
peaked over 40 years ago and has
been declining ever since despite
furious drilling and unprecedentedly
high prices.
Natural gas is likewise expected to
peak some time around 2010-2020,
and coal around 2020-2030. By the
end of this century, nearly all of the
economically recoverable fossil fuels
will be gone. From now until then,
what remains will be rationed by
price. There will be shortages. The
coming energy shortage is the most
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Volume 1 Issue7 Nov 2014
serious crisis the world has ever
faced, but it could have a very
positive outcome. In theory, the
Earth’s wind, solar, geothermal and
marine resources could each provide
more than the total energy the world
consumes every day, if we had the
ability to harvest them.
5
Conclusion
The main conclusions included the
following points.






There are significant challenges
in meeting the projected total
energy demand.
The use of fossil fuels may
seem beneficial to our lives, but
it is playing a role on global
warming and it is said to be
dangerous for the future.
The environmental pollutions
impacts on the human beings
because of the use of fossil fuel
on the air cause negative health
effects when inhaled by people.
Policies aimed at curbing
carbon dioxide emissions will
alter the energy mix by
increasing energy-related costs
and requiring reductions in
demand growth.
To get global economies on an
indefinitely
sustainable
foundation, we need to make
far more efficient use not only
of energies but also of raw
materials.
The accelerated development of
carbon capture and storage
technologies to enable the

necessary
continuation
of
electricity production from
abundant fossil fuels.
The
renewable
energy
production will expand in the
future, and end up with a
largely carbon free economy in
the end of the 21st century.
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