Part 4, The Importance of Energy to Economic Prosperity

INTRODUCTION, The Rise of the American Economy

Economic prosperity and energy use have gone hand in hand for most of history. This blog is about the importance of energy today so let’s just go back about 140 years or so.  The first battery in the world was invented by Antonio Volta at the beginning of 19th century. In 1831, Michael Faraday devised a machine that generated electricity from rotary motion, but it took almost 50 years for the technology to reach a commercially viable stage. In 1878, Thomas Edison (U.S.A) developed the first stable and domestic light bulb which led to the first commercial power plant in 1882. Thomas Edison, George Westinghouse and Nikola Tesla all had parts in developing and commercializing the generation of electricity in America. Edison’s Pearl Street Station, is in my understanding, the first central station power plant in the world. It was started up about 1881. It was Direct Current. Then in 1897 George Westinghouse and Nikolai Tesla completed the first major Alternating Current Power Station at Niagara Falls. Here are excerpts of a speech by Nikola Tesla:

Nikola Tesla’s Speech at Niagara Falls Opening Ceremony

“We have many a monument of past ages; we have the palaces and pyramids, the temples of the Greek and the cathedrals of Christendom.  In them is exemplified the power of men, the greatness of nations, the love of art and religious devotion.  But the monument at Niagara has something of its own, more in accord with our present thoughts and tendencies.  It is a monument worthy of our scientific age, a true monument of enlightenment and of peace.  It signifies the subjugation of natural forces to the service of man, the discontinuance of barbarous methods, the relieving of millions from want and suffering”
 – Nikola Tesla’s speech at the opening ceremony of the hydroelectric power station, January 12, 1897.

The Industrial Revolution had already began but now in the 20th Century the Developed World had electricity to drive economic progress forward. Tesla, Westinghouse and Edison had started an incredible Century of Industrial growth made possible by harnessing energy.

When I worked for Carolina Power and Light the CEO at the time, was Sharon Harris, (he, Bill Lee of Duke Power and other Electric Utility Executives) used to give speeches and proudly show a chart of electricity and energy use correlated with economic growth. In previous chapters I have discussed the importance of heat engines. Most electricity in the world is generated from thermal power plants. Large hydro-electric plants like Niagara Falls, Grand Coulee Dam or the Three Gorges Dam in China are huge. However, there are limited sites for hydro-electric power on the planet and most of the electricity is generated from thermal power stations. Vaclav Smil has written a book on the history of “Energy and Civilization”. One of the graphs included is the one below which shows the primary energy used from the year 1800 to 2019. Quality of life and as the investor owned electric utilities coined the phrase in the 1950’s “Living Better Electrically” was indeed true. Industrial output as well as air conditioning, heating and cooking became much improved after electricity became readily available.

Graph from Our World in Data, BP and Vaclav Smil. Primary Energy Use of the World 1800-2019

In America, our manufacturing output dominated the world in with America’s immense productive capacity. Especially during and following WWll when America became the “Arsenal of Democracy” and ramped up steel, aluminum and war materiel production to provide the U.S. Military as well as our Allies with ships, planes and arms. After the war, America turned to manufacturing for building infra-structure, cars, trucks, airplanes and home appliances. Living Better Electrically became a reality.

The manufacturing increases in the U.S.A. 1940-1960 were the envy of the world. These were driven by energy and in particular, coal energy. Here below is a graph from the EIA which I used in a presentation to an ASME meeting in 2015 to discuss the “Importance of Coal” The parallel growth of GDP (Gross Domestic Product) and coal usage were very proportional.

America’s Major Fuels

Coal was the dominant fuel starting about the mid 19th Century until the last decade. Nuclear became important starting about 1960. Then natural gas became competitive and today is the dominant fuel for America’s electricity generation.

2009 data from the Energy Information Administration, correlating coal consumption and GDP

Admiral Hyman Rickover invented nuclear propulsion systems for the U.S. Navy at the end of WWll. Then about 1957 through President Eisenhower’s “Atoms for Peace” Initiative, Admiral Rickover was asked to work with the private sector to develop peaceful nuclear power plants. The first of these was Shippingport, near Pittsburgh, PA. Between 1960 and about 1980 over 100 nuclear power stations were built and commissioned in America. After the accident (No one was injured or killed) at Three Mile Island nuclear power plant, no more nuclear units were purchased until about thirty years later with the Southern Company Vogel nuclear plant expansion. (Still under construction, expected to startup in 2022). The nuclear plants are important too. Although today there are just under 100 operating nuclear plants, nuclear energy provides about 20% of America’s electricity. Before the Shale Gas Revolution, nuclear plants provided the lowest cost electric power generation.

A Few Words on Solar and Wind Power

My purpose in starting this Blog is to provide information related to energy and economic prosperity with a focus on Heat-Engines that provide most of our (and all of the Developed World’s power) motive force for driving transportation, industrial production and electricity.

Excessive renewable power has been forced onto the Grid because of Laws and Regulations. My friend Donn Dears has an excellent Blog “Power for the U.S.A.” where he addresses regulations and more advanced discussions of why renewable power has caused so many problems. In fact, his book “The Looming Energy Crisis, Are Blackouts Inevitable” covers much on this topic. Suffice it to say, wind and solar power is being forced onto the Grid by Rigged Auctions. If you wish further information on this, I recommend visiting Donn Dears Blog and buying his book mentioned above. Here is a link to Mr. Dear’s Blog:

In 2019 the fuels used to generate America’s electricity were:

17.5% Renewables of which about 40% was from old hydroelectric generators

The great abundance of our electricity generation comes from Heat-Engines, to be precise about 82%. Now let’s review the shale gas revolution and the part it played in keeping electricity generation costs reasonable to power the American economy.

THE SHALE GAS REVOLUTION, Thanks to Hydraulic Fracturing (Fracking)

It was about 2009-2012 that natural gas became much more abundant in the U.S.A. due to the disruptive technology of Hydraulic Fracturing combined with Directional Drilling. As America progressed into becoming the world’s largest natural gas producer, natural gas power plants started replacing coal power ( and sadly, some nuclear units) generation.

The economics of selecting the fuel to use is based on the production cost of electricity. The cost to produce electricity includes a number of components: Amongst these cost factors are, the cost of the fuel, Capital cost to build the plant, operational labor costs, maintenance costs and environmental reagents and chemicals.

Natural gas plants with a high efficiency are hard to beat for producing the lowest cost electricity as long as gas prices are below $3.00/million Btu’s and providing the gas is abundant and available with operating pipelines. In western PA, gas is an easy solution. In northern Alaska or Hawaii, there are few, if any gas lines. Therefore the fuel choices and equipment choices to produce the lowest cost electricity can vary drastically by states and even within each state.

The correlation of electricity consumption and GDP is very much influenced by industrial production. Producing primary metals of aluminum, copper and steel for example use enormous amounts of electricity. A so called Steel “Mini Mill” will use about 175,000 kW of electricity. An aluminum smelter, depending on the size, about 400,000 kW. It takes about 5 kWh of electricity to produce one pound of aluminum ingot from aluminum oxide. So as more industrial output is built, so does the electricity demand increase. Conversely, as America became de-Industrialized in the late 1990’s after NAFTA and later when China entered the World Trade Organization, then much electricity capacity that was used for primary metals production and manufacturing became available for commercial and residential use. This shift from industrial consumption to residential and commercial consumption helped keep America’s electricity prices reasonable.

Energy Fuels the Rise of China’s Manufacturing and Economic Strength 2001-2020

The reader will likely be well informed on the Industrial Revolution and growth of American manufacturing during the 20th Century. The growth of China’s Manufacturing and Economy between the year 2001 and 2020 is startling. Unfortunately, the growth of China’s manufacturing came at the expense and loss or transfer of much of America’s heavy industry. Especially energy intensive manufacturing of steel and aluminum. China currently produces about 50% or more, of the world’s steel and aluminum. So, let’s explore the growth of China’s aluminum industry and how the energy production paralled that rise.

China’s coal consumption 1980-2018. China uses as much coal as all of the rest of the world each year

Another chart below shows how China’s Electric Production 1980 through 2019:

China built hundreds of large coal plants and also completed the Three Gorges Dam which is the largest Hydro-Electric plant in the world. Much of this electricity production was utilized for primary metals production and manufacturing. The figure below shows the comparison of China’s manufacturing output compared to America’s.

The aluminum ingots on a dock in China ready for export to the world. Production of all primary metals is energy intensive. However, aluminum requires enormous amounts of electricity to produce ingot metal from aluminum oxide. If you correlate the coal electricity prodution increases with aluminum production one can see where a lot of the electricity was utilized.

In July 2016, I prepared a presentation to “The Delaware County Bar Association”. This is in the suburbs of Philadelphia, PA. My presentation was to show the linkage of energy, electricity, jobs and Real-Estate and how energy impacted the Pennsylvania economy in 2016. Having worked with ALCOA ( a PA based company) as a consultant/contractor from 1977-2012, I had a “Fly on the Wall” viewpoint of how China was over-producing and dumping aluminum metal ingots on the world markets. The full text of my presentation is included in this Blog if the reader is interested. See “Energy and Economic Prosperity, July 15, 2016”. It is one of the first entries to this WordPress site.

Perhaps a stretch on the correlation to PA Real-Estate transactions , but World Competitiveness of primary metals and energy costs are a little more direct. The next graph is Chinese aluminum production during the period that they were accepted into the WTO (World Trade Organization). It is pretty drastic and from my personal experiences, had been working as a consultant/contractor for ALCOA Worldwide Alumina. My first assignemnt with ALCOA was in 1977 at the Mobile, AL Refinery. Now shut down. I worked for ALCOA almost every year since then up to about 2012. The plant shutdowns in the U.S.A. were sickening to observe. ALCOA went from a workforce of about 125,000 in about 2003 to about half that in a decade. Meanwhile, China’s aluminum production ramped up sharply as China exceeded all of the rest of the world’s production capacity. The metal was agressively traded on the Free Markets of the London Metal Exchange and eventually achieving more than 50% of the worlds production. The story for steel production is similar.

China’s Aluminum Production is shown in green and is far above all of the other major world producers of the metal. This graph was copied from the International Aluminum Institute in 2016 when I was preparing for the June presentation that year.
A comparison of Aluminum Production in China compared to the rest of the world. up to 2011. Chart from the Wall Street Journal.
Note the Chinese steep increase in manufactured goods starting about 2004. China was accepted into the WTO 2001
Trucks shipping made in China products to distribution centers in the U.S.A. Chinese manufacturing and exports to America exploded after China entered the WTO in 2001
As of 2018, China became the largest Manufacturing Country in the world.


It was my intention for this section to illustrate how Energy and Economic Prosperity are inextricably linked. The two main comparisons in the foregoing were the rise of the U.S.A. and China. The U.S.A. rise in world status began about 1890, the approximate time that electricity was commercialized, until present. China had the advantage of copying the electric producing equipment and electrification model used by America. When China’s rise began it was as a result of agressive manufacturing, powered mostly from coal fueled thermal power generation plants. The proceeds of exported manufactured products then fueled their economy. This incredible rise took only about twenty years. America’s rise had taken about 100 years. China had the advantage of using American technology and expertise’ with very little Regulations on air and water quality to build their enormous capacity in power generation. This accellerated following the admission of China to the WTO. Following 2001, China rapidly expanded their electricity production capacity. Unfortunately for the U.S.A., the rise of China manufacturing was largely at the expense of American manufacturing capacity and jobs.

My point in this section is to simply show the relationship of energy and economic prosperity. I hope you find it interesting.

Dick Storm, September 21, 2020


The U.S. Department of Energy, through the EIA (Energy Information Administration) keeps up with the energy used by America. The measurement used is the BTU or British Thermal Unit. One BTU is the amount of heat required to raise one pound of water (about a pint) one degree Fahrenheit. Thus heating a pound of water from 32 degrees F. to 212 degrees F. requires 180 BTU’s. So, why is it important to know how many Btu’s are utilized? The reason is that 90% of the energy used in America is used by Heat-Engines to provide the motive force for vehicles, airplanes, drive electric generators and power industry. America in 2019 used about 100.2 Quadrillion Btu’s. Here is how these units of heat energy were utilized:

Most folks don’t think about Heat-Engines and their importance to provide our everyday high quality of lives. The facts are that Fossil Fuels, Nuclear and Thermal Power from Biomass together consume about 90% of our total energy. Did you ever consider that a Boeing 747 at cruise will consume about a gallon of jet fuel a second and burn about ten tons of jet fuel/hour of flight time. Everyday when you are driving you enjoy the convenience of your personal vehicle and see many large trucks delivering needed goods to local stores or shipping interstate. Electric vehicles are becomeing more common on the highway, but they too are using energy that originated (80+%) as either coal, natural gas or nuclear energy. An electric vehicle such as a Tesla uses stored electricity to power the vehicle. The electricity to charge the batteries (usually) comes from the American electric grid, most of which (about 80%) is provided by conventional energy of natural gas, nuclear and coal.

The intent of this chapter is to describe Heat-Engines. So lets first look at the example of a steam turbine commonly used in thermal power generation plants.

The simplified process of converting chemical energy of fuel to heat, to steam and then converting the heat energy to turn a magnet in a coil of wire to produce electricity

Each Btu is worth 778 foot pounds of mechanical Energy if converted from heat to work at 100% efficiency.

In essence, this is the process that takes place in all steam powered thermal power plants. Whether wood, coal, Biomass, natural gas or nuclear fueled. The heat is used to generate steam and then the steam is passed through a steam turbine to produce electricity. The figure below shows examples of heat engines that we depend on every day. Each of these converts heat energy from fossil fuels into motive force for either transportation or the generation of electricity.

Each of the examples above are heat engines. The auto and aircraft engines are internal combustion engines. The car uses a gasoline engine. The jet airliner uses a jet engine. The steam turbine (is really an external combustion engine) in the lower center has the top half of the shell removed to expose the turbine blading and rotor. The large reciprocating Diesel engine driven generator in the lower right is a drive engine for a ship and uses the Diesel cycle. Another version of a reciprocating internal combustion engine is the natural gas fueled, spark ignited gas engine. A natural gas reciprocating engine will look very similar to a Diesel or gasoline reciprocating engine. The steam turbine uses steam generated in a boiler, thus the combustion is external to the steam turbine and it would be considered an “External Combustion Engine”.

Modern Coal plants use the Rankine steam cycle to generate electricity.

The process of converting coal energy to electricity is shown below. In this example about 0.8 pound of coal is used to generate one kilowatt of electricity. One kilowatt hour of electricity is about the same as using ten 100 watt light bulbs or one toaster for an hour.

A simplified steam power plant fueled by coal

The illustration is greatly simplified. In order to achieve high efficiency a clean coal fueled power plant has lots of complicated equipment and the steam turbine is multiple stages of highly precise manufacture. A typical electric utility scale steam turbine is shown below. This is the prime mover to spin the rotor (magnet) of the generator.

The illustration above is a large electric utility scale steam turbine. A typical 600 MW steam turbine will utilize about 4.2 million pounds of steam flowing through it per hour at 1,000 degrees Fahrenheit. The flow of 4.2 million pounds of steam per hour is equivalent to about 8,403 gallons per minute of water flow entering the steam generator. Therefore, all of the components of the steam generator, fuel handling and emissions control devices are huge in size.

A schematic of a modern coal plant which utilizes the Rankine steam cycle is shown below. This shows the water, steam, cooling water flows through the boiler, steam turbine-generator and condenser. The illustration does not include the enormous amount of equipment for fuel preparation and emissions control. Solid fuels require much more equipment to convert the heat to electricity than liquid or gaseous fuels.

Here below is a modern four unit, 2,400 MW coal power plant. In this example, the four boilers are the tallest structures and are about as tall as twenty story building. The stacks are about 300 ft tall. The plume of gases coming our of the stacks is water vapor. This is steam released as the exhaust flue gases are cleaned from sulfur using limestone slurry of water and powdered lime. Known in the industry as Flue Gas Desulfurization. So the white plumes are simply water vapor from the cleaned flue gases. Also within the plumes are the invisible gases of nitrogen, carbon dioxide and oxygen.

A modern coal power plant with four units and including FGD (Flue Gas Desulfurization) and SCR (Selective Catalytic Reactor) to remove oxides of nitrogen emissions

A 2,400 MW power plant when operating at full capacity (depending on the heating value of the coal fuel) will burn about 2,000,000 pounds per hour of coal. Supplied by 100 ton rail cars this is about 10 rail cars per hour of fuel. The raw coal supplied from the mines is pulverized to a fine powder slightly more coarse than face powder and is conveyed to the furnaces using fans to mix the powdered fuel with air. The coal is burned in suspension in the furnaces much like a huge gas flame. A schematic of a typical Utility scale Steam Generator (Boiler) is shown below.

A Typical 600 MW Utility Scale Steam Generator. The furnace is approximately 40 ft. deep by 80 ft wide and about 150 feet tall. A Unit such as this will burn about 133 pounds of coal per second and the products of combustion will be completely burned out and converted to hot gases in about one second in the furnace. The coal particles are an average size of about 60 microns and burn as a gas. The grey device on the lower left of the illustration above represents a coal pulverizer. A boiler this size will usually have five or six large coal pulverizers to supply the fuel to the furnace.

This description is intended for High School students and to provide a brief overview of the various heat-engines that we depend on each day. Suffice it to say, a large coal power plant is a very complicated and very large complex of equipment. In essence a huge “Heat-Engine” that uses solid fuel, coal. The coal is burned in the furnace above reaching peak temperatures of about 3,000 degrees Fahrenheit. As the products of combustion pass through the boiler the water entering is heated to steam at up to 1,150 degrees F. and the flue gases (Products of combustion) are cooled to about 300 degrees F. The flue gases are then treated with emissions equipment to remove the oxides of nitrogen, the sulfur and the solid ash particulates. The solid ash particles are referred to as being Flyash and today much of the flyash is recycled to use in high strength concrete. Much of the FGD scrubber slurry waste (calcium sulfate) is recycled into sheetrock for home building.

A modern, clean coal plant such as the above example may require a staff of about 160 full time employees. One of the reasons coal plants have difficulty competing with natural gas plants is the large number of personnel and the costs of fuel preparation, maintenance and cost of chemical reagents to remove the sulfur and oxides of nitrogen from the exhaust gases. A Gas Turbine Combined cycle plant of four units and also producing 620 MW will require a staff of about 25 employees. A four unit 2,400 MW of power will require a much smaller staff than a similar sized coal plant, about 40 full time employees.

The choice of the fuel and prime mover depends on the geography and availability of coal, natural gas or nuclear fuel. Alaska for example is most suitable for coal because there is not a network of gas pipelines. Also, the demand for power is less than would be justified to construct a large nuclear plant. Coal plants are also common and competitive in Developing Nations such as African and Asian countries.

Background on How Natural Gas Plants Using Aeroderivative Gas Turbine Drives Have Replaced Much of America’s Coal Electric Power Generation

Up till about the year 2010 about 50% of America’s electricity was generated from coal and about 20% from nuclear. Then came Hydraulic Fracturing and oil and gas production in the U.S.A. from locations that were not anticipated before, such as North Dakota and Pennsylvania. The U.S.A. after ten years or so of successful and highly productive Hydraulic Fracturing and directional drilling, the U.S.A. has become the world’s #1 oil and gas producing nation. What does this mean? It means economic prosperity for the U.S.A. but also it has been a disruptive economic force in electric power generation. Because about 75% of the production cost of electricity from a coal plant is fuel, the new low cost natural gas has made natural gas a less expensive fuel option for power generation. In addition, the Gas Turbine Combined Cycle Power Plants have become the most efficient “Heat-Engines” ever developed. A GTCC Power Plant has far less components than a similar sized coal plant, thus a much smaller staff and overall has lower operations & maintenance production cost. (GTCC=Gas Turbine Combined Cycle) Because of the small staff the main production cost for electricity from a GTCC plant is fuel. The natural gas fuel is about 90% of the production cost of electricity from a GTCC plant.

Further, not only lower fuel costs than coal, the GTCC plants are now approaching 65% Thermal Efficiency. More on thatin a later chapter on economics of power generation.

How Did Jet Airplane Engines Fit Into Electric Power Generation?

Jet aircraft engines have been used for air travel and military uses since the 1950’s. The jet engine is another form of internal combustion engine. For jet airplanes, the engine creates hot air and gases that are forced out the rear of the engine thus causing thrust, a force to propel the airplane forward. For planes designed to fly less than about 450 mph, such as Regional Air Transportation, a Turbo-Prop is more efficient than jet thrust alone. A derivation of the jet engine is to use the hot air and combustion products to force over a gas turbine rotor and turn a shaft which in turn drives a propellor. This is called a “Turbojet”. Many Regional commuter airliners use propellors driven by a turbojet engine. A turbo-prop engine is shown below.

Turbo-Prop Engine fueled by jet fuel. The jet engine provides hot gases to spin the turbine which creates shaft power to drive the propellor.

The jet engines and turbo prop engines have advanced in power and efficiency drastically since first use during WWll. The advancements have been applied to Gas Turbines used for power generation in stationary power plants. This gas turbine engines which are derived from the best aviation jet engines to power generation have been referred to as “Aeroderivative”. That is because the R&D that was invested in developing the most powerful and highly efficient jet engines has been adapted to electric power generation using natural gas fuels. The G-E “F Class” Series of “Gas Turbine as installed in many modern natural gas fueled power generation plants. A G-E Gas Turbine is shown below. Siemens, Mitsubishi, Rolls-Royce, Pratt-Whitney and a few other world manufacturers also design and manufacture large Utility Scale Gas Turbines.

As described earlier, the gas turbine drives a shaft which is connected to a generator to produce electricity. Here is a schematic of the gas turbine combined cycle plant exhausting heat to a steam generator that then provides steam to a steam turbine. This is called a Gas Turbine, Combined Cycle Power Plant. The combined cycle is using two cycles for power generation, the internal combustion (Brayton) cycle and the external combustion (Rankine) steam cycle. By combining the two cycles overall efficiencies have reached the highest of any other thermal power generatioin cycle or process at up to 65% efficient.

A modern 620 MW Gas Turbine, Combined Cycle Power Plant is shown below. This is the Duke Energy, Buck Plant located near Salisbury, NC.

Duke Energy’s Buck Gas Turbine Combined Cycle Power Plant located near Salisbury, NC

South Carolina has generated about 28.6% of the electricity consumed from natural gas fuel. Most of that is through gas turbine combined cycle plants similar to the Duke Buck Plant in the photo above. FYI, North Carolina generated about 33% of that states electricity from natural gas.

Up to this point we have discussed the reciprocating gasoline engine, the Diesel, coal plants, jet engines and gas turbines. All of these are variations of “Heat-Engines” they convert heat energy into thrust or shaft horsepower that is a motive force for either propulsion of a vehicle, train, ship or plane or for turning a shaft that drives an electric generator. These engines consume a high percentage of the total energy utilized in America. Next covered is nuclear which has generated about 18-20% of America’s electric power for decades. A nuclear plant produces steam using the heat of nuclear fission. The steam is then passed through a steam turbine, much the same as in a coal plant described above. Here below is a schematic of a nuclear power plant using a pressurized water reactor,

An example of a pressurized water reactor system for generating electricity from nuclear power. The Turbine-Generator and condenser are similar to those utilized in a large coal plant.

Electricity generated from nuclear power also utilizes the steam turbine prime mover as a massive heat engine. Instead of using combustion to provide the heat to produce steam, a nuclear power plant utilizes nuclear fission within the reactor vessel. The primary coolant for the nuclear reaction is water under high pressure so that it will not boil. This loop of hot, pressurized water is circulated through the steam generator where the heat is transferred to the secondary cycle which provides the steam flow to drive the steam turbine. Another version of a “Heat-Engine”

Other Heat-Engines that We Depend on

You have heard of renewable power generation which includes Hydro-electric, solar, wind and biomass. Solar and wind usually generate power directly, although there are a couple of hybrid designs that utilize sunlight to boil water and produce steam. These will not be discussed here.

Biomass fuel such as waste wood or processed wood chips is used much like coal in a boiler furnace to produce steam to drive a turbine generator, Then there is Bio-Fuels such as Ethanol made from corn which is added to gasoline and burned in Internal Combustion engines of our cars and trucks.

Another form of Biomass fuel is Landfill Gas which is methane that is generated from decaying garbage in landfills. This gas is collected and piped to power boilers to generate steam and electricity.

Lastly, a small amount of electricity is generated in the U.S.A. by geothermal power. This is usually in the western U.S.A. in California and Nevada where hot rocks below the ground are used to generate steam which is then passed through a steam turbine generator.

The above serves as a primer to become familiar with the importance of heat engines in our everyday lives.

Dick Storm, September 9, 2020