I was surprised by Chris Nelder's comments about my article. Much of what he writes mischaracterizes my argument and some of it makes no sense at all.
He begins by observing, correctly, that the ultimate use of methane hydrate, like any natural resource, will depend on whether it can be produced at a reasonable price--something my article points out more than once. He then goes on to say:
If Mann's data on methane hydrates is correct, then Japan's experiment so far has taken 10 years and $700 million to produce 4 million cubic feet of gas, which is worth about $16,000 at today's U.S. gas prices, or about $50,000 at today's prices for imported LNG in Japan. At this point, it is an enormously expensive experimental pilot project, and nothing more.
Nelder is correct: the Japanese methane hydrate project is an "enormously expensive experimental pilot project." Indeed, I described it as such in my article. When engineers develop a new technology, they spend lots of money at the beginning and for a while get very little in the way of commercial return. To object that Japan has only produced 4 million cubic feet of gas for $700 million is like arguing halfway through Edison's development of the electric light that he was getting very little illumination for the millions he had spent on research. The statement is true, but not his implication.
Nelder then goes on to cite many projections that renewables will come down in cost. One of them is a recent Citigroup report. Unfortunately, Nelder links only to news coverage of the report, not the report. The report itself compares only the cost of "producing a unit of electricity" with gas and home solar (p. 42, my italics). Unfortunately, the home-solar figure does not include the cost of storing electricity for night and cloudy days, which engineers regard as a necessary part of the transition to renewables. (This is a cost with which I have personal experience. When my family built a new house last year, we installed a large and, for us, expensive photovoltaic array. But we could not go off the grid, as we had hoped, because we could not afford the costly batteries needed to store the power we generated during the day for use at night.)
Similarly, the Stanford researchers Nelder cites also compare "the generating cost of power from solar PV ... to the retail electricity prices that commercial users pay" (my italics). Again, this calculation, useful as it is, does not include storage costs. Equally important, the Stanford researchers note upfront that their conclusions about the economic viability of solar installations assume that each installation is in "an ideal geographic location." Not a single place on the Eastern Seaboard constitutes such an ideal location. As Nelder must know, in our current electrical grid there is no way for power from places like the southwest, with plenty of sun, to flow to places like the northeast, which lack sun, because the grid is, for historical reasons, divided into three independent fiefdoms that are unable to send power to each other. The grid can and should be reconfigured, but this, too, is part of the cost of the transition to renewables. (Those who are curious about this sort of thing can learn a lot from Maggie Koerth-Baker's Before the Lights Go Out, a fine primer about why one should take glib statements about the grid with a grain of salt.)
Nelder's third source, about solar costs in Asia, refers to an off-hand claim in a blog post rather than an actual study with carefully collected data. But again, the blog post refers only to the cost of power generation--an important factor, but not the only one.
Next Nelder points to EIA statistics about domestic production of "tight oil", the kind of oil from fracking, and argues that "one cannot easily make a case for incipient U.S. 'energy independence' on the basis of 1 mb/d of new tight oil production."
Happily, nobody is doing this. The basic argument is that although domestic oil production will rise, the more important phenomenon is the increase in domestic natural gas production, and that much of the petroleum imported today can be substituted for by domestic natural gas. This last is already happening, as I describe in my article. Not only are utilities switching from coal and oil to gas, but also trucking, schoolbuses, garbage trucks and even taxi fleets. In the northeast, the last bastion of the heating-oil industry, homeowners are converting their furnaces to gas. The incentives are strong: in terms of gasoline, natural gas now costs the equivalent of $2.10/gallon. (Michael Levi's just-published book, Power Surge, further discusses this switch, and how to accelerate it.)
In contrasting fracking (by which I mean the combination of horizontal drilling with hydraulic fracturing) with the technology for extracting methane hydrate, Nelder claims that the methods of the former are "not new technologies," whereas the latter are novel and unproven. This is ridiculous. First, until recently fracking was considered novel and unproven. Even in the late 1990s, as oil analyst Daniel Yergin pointed out in The Quest, the oil and gas in the Barnett Shale, the nation's most important shale deposit, "was so much off the radar screen that when people did forecasts of future natural gas supplies, the Barnett did not even show up" (p. 329). True, as Nelder says, bits and pieces of fracking technology trace back to the 1940s. But it took decades of slow, piecemeal research by government and industry to make fracking commercially viable. The first commercially successful hydraulic fracturing/horizontal drilling did not occur until 2003 and 2004.