Liquefied natural gas

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Liquefied natural gas (LNG) is natural gas (predominantly methane, CH₄) that has been converted to liquid form for ease of storage or transport. It takes up about 1/600th the volume of natural gas in the gaseous state. It is odorless, colorless, non-toxic and non-corrosive. Hazards include flammability after vaporization into a gaseous state, freezing and asphyxia. The liquefaction process involves removal of certain components, such as dust, acid gases, helium, water, and heavy hydrocarbons, which could cause difficulty downstream. The natural gas is then condensed into a liquid at close to atmospheric pressure by cooling it to approximately −162 °C (−260 °F); maximum transport pressure is set at around 25 kPa (4 psi).

A typical LNG process. The gas is first extracted and transported to a processing plant where it is purified by removing any condensates such as water, oil, mud, as well as other gases such as CO₂ and H₂S. An LNG process train will also typically be designed to remove trace amounts of mercury from the gas stream to prevent mercury amalgamizing with aluminium in the cryogenic heat exchangers. The gas is then cooled down in stages until it is liquefied. LNG is finally stored in storage tanks and can be loaded and shipped.

LNG achieves a higher reduction in volume than compressed natural gas (CNG) so that the (volumetric) energy density of LNG is 2.4 times greater than that of CNG or 60 percent of that of diesel fuel.^[1] This makes LNG cost efficient to transport over long distances where pipelines do not exist. Specially designed cryogenic sea vessels (LNG carriers) or cryogenic road tankers are used for its transport. LNG is principally used for transporting natural gas to markets, where it is regasified and distributed as pipeline natural gas. It can be used in natural gas vehicles, although it is more common to design vehicles to use compressed natural gas. Its relatively high cost of production and the need to store it in expensive cryogenic tanks have hindered widespread commercial use.

§Specific energy content and energy density

The heating value depends on the source of gas that is used and the process that is used to liquefy the gas. The range of heating value can span +/- 10 to 15 percent. A typical value of the higher heating value of LNG is approximately 50 MJ/kg or 21,500 Btu/lb.^[2] A typical value of the lower heating value of LNG is 45 MJ/kg or 19,350 BTU/lb.

For the purpose of comparison of different fuels the heating value may be expressed in terms of energy per volume which is known as the energy density expressed in MJ/liter. The density of LNG is roughly 0.41 kg/liter to 0.5 kg/liter, depending on temperature, pressure, and composition,^[3] compared to water at 1.0 kg/liter. Using the median value of 0.45 kg/liter, the typical energy density values are 22.5 MJ/liter (based on higher heating value) or 20.3 MJ/liter (based on lower heating value).

The (volume-based) energy density of LNG is approximately 2.4 times greater than that of CNG which makes it economical to transport natural gas by ship in the form of LNG. The energy density of LNG is comparable to propane and ethanol but is only 60 percent that of diesel and 70 percent that of gasoline.^[4]

§History

Experiments on the properties of gases started early in the seventeenth century. By the middle of the seventeenth century Robert Boyle had derived the inverse relationship between the pressure and the volume of gases. About the same time, Guillaume Amontons started looking into temperature effects on gas. Various gas experiments continued for the next 200 years. During that time there were efforts to liquefy gases. Many new facts on the nature of gases had been discovered. For example, early in the nineteenth century Cagniard de la Tours had shown there was a temperature above which a gas could not be liquefied. There was a major push in the mid to late nineteenth century to liquefy all gases. A number of scientists including Michael Faraday, James Joule, and William Thomson (Lord Kelvin), did experiments in this area. In 1886 Karol Olszewski liquefied methane, the primary constituent of natural gas. By 1900 all gases had been liquefied except helium which was liquefied in 1908.
The first large scale liquefaction of natural gas in the U.S. was in 1918 when the U.S. government liquefied natural gas as a way to extract helium, which is a small component of some natural gas. This helium was intended for use in British dirigibles for World War I. The liquid natural gas (LNG) was not stored, but regasified and immediately put into the gas mains.

The key patents having to do with natural gas liquefaction were in 1915 and the mid-1930s. In 1915 Godfrey Cabot patented a method for storing liquid gases at very low temperatures. It consisted of a Thermos bottle type design which included a cold inner tank within an outer tank; the tanks being separated by insulation. In 1937 Lee Twomey received patents for a process for large scale liquefaction of natural gas. The intention was to store natural gas as a liquid so it could be used for shaving peak energy loads during cold snaps. Because of large volumes it is not practical to store natural gas, as a gas, near atmospheric pressure. However, if it can be liquefied it can be stored in a volume 600 times smaller. This is a practical way to store it but the gas must be stored at -260 °F.

There are basically two processes for liquefying natural gas in large quantities. One is a cascade process in which the natural gas is cooled by another gas which in turn has been cooled by still another gas, hence a cascade. There are usually two cascade cycles prior to the liquid natural gas cycle. The other method is the Linde process. (A variation of the Linde process, called the Claude process, is sometimes used.) In this process the gas is cooled regeneratively by continually passing it through an orifice until it is cooled to temperatures at which it liquefies. The cooling of gas by expanding it through an orifice was developed by James Joule and William Thomson and is known as the Joule-Thomson effect. Lee Twomey used the cascade process for his patents.

§Commercial Operations

The East Ohio Gas Company built a full-scale commercial liquid natural gas (LNG) plant in Cleveland, Ohio, in 1940 just after a successful pilot plant built by its sister company, Hope Natural Gas Company of West Virginia. This was the first such plant in the world. Originally it had three spheres, approximately 63 feet in diameter containing LNG at -260 °F. Each sphere held the equivalent of about 50 million cubic feet of natural gas. A fourth tank, a cylinder, was added in 1942. It had an equivalent capacity of 100 million cubic feet of gas. The plant operated successfully for three years. The stored gas was regasified and put into the mains when cold snaps hit and extra capacity was needed. This precluded the denial of gas to some customers during a cold snap.
The Cleveland plant failed on October 20, 1944 when the cylindrical tank ruptured spilling thousands of gallons of LNG over the plant and nearby neighborhood. The gas evaporated and caught fire, which caused 130 fatalities.^[6] The fire delayed further implementation of LNG facilities for several years. However, over the next 15 years new research on low-temperature alloys, and better insulation materials, set the stage for a revival of the industry. It restarted in 1959 when a U.S. World War II Liberty ship, the Methane Pioneer, converted to carry LNG, made a delivery of LNG from the U.S. Gulf coast to energy starved Great Britain. In June 1964, the world's first purpose-built LNG carrier, the "Methane Princess" entered service.^[7] Soon after that a large natural gas field was discovered in Algeria. International trade in LNG quickly followed as LNG was shipped to France and Great Britain from the Algerian fields. One more important attribute of LNG had now been exploited. Once natural gas was liquefied it could not only be stored more easily, but it could be transported. Thus energy could now be shipped over the oceans via LNG the same way it was shipped by oil.

The domestic LNG industry restarted in 1965 when a series of new plants were built in the U.S. The building continued through the 1970s. These plants were not only used for peak-shaving, as in Cleveland, but also for base-load supplies for places that never had natural gas prior to this. A number of import facilities were built on the East Coast in anticipation of the need to import energy via LNG. However, a recent boom in U.S. natural production (2010-2014), enabled by the new hydraulic fracturing technique (“fracking”), has many of these import facilities being considered as export facilities. The U.S. Energy Information Administration predicts, with present knowledge, that the U.S. will become an LNG exporting country in the next few years.

§Production

The natural gas fed into the LNG plant will be treated to remove water, hydrogen sulfide, carbon dioxide and other components that will freeze (e.g., benzene) under the low temperatures needed for storage or be destructive to the liquefaction facility. LNG typically contains more than 90 percent methane. It also contains small amounts of ethane, propane, butane, some heavier alkanes, and nitrogen. The purification process can be designed to give almost 100 percent methane. One of the risks of LNG is a rapid phase transition explosion (RPT), which occurs when cold LNG comes into contact with water.^[8]

The most important infrastructure needed for LNG production and transportation is an LNG plant consisting of one or more LNG trains, each of which is an independent unit for gas liquefaction. The largest LNG train now in operation is in Qatar. These facilities recently reached a safety milestone, completing 12 years of operations on its offshore facilities without a Lost Time Incident.^[9] Until recently it was the Train 4 of Atlantic LNG in Trinidad and Tobago with a production capacity of 5.2 million metric ton per annum (mmtpa),^[10] followed by the SEGAS LNG plant in Egypt with a capacity of 5 mmtpa. In July 2014, Atlantic LNG celebrated its 3000th cargo of LNG at the company’s liquefaction facility in Trinidad.^[11] The Qatargas II plant has a production capacity of 7.8 mmtpa for each of its two trains. LNG sourced from Qatargas II will be supplied to Kuwait, following the signing of an agreement in May 2014 between Qatar Liquefied Gas Company and Kuwait Petroleum Corp.^[11] LNG is loaded onto ships and delivered to a regasification terminal, where the LNG is allowed to expand and reconvert into gas. Regasification terminals are usually connected to a storage and pipeline distribution network to distribute natural gas to local distribution companies (LDCs) or independent power plants (IPPs).

§LNG plant production

Information for the following table is derived in part from publication by the U.S. Energy Information Administration.^[12]

Plant Name	Location	Country	Startup Date	Capacity (mmtpa)	Corporation
Qatargas II	Ras Laffan	Qatar	2009	7.8
Arzew GL4Z		Algeria	1964	0.90
Arzew GL1Z		Algeria	1978
Arzew GL1Z		Algeria	1997	7.9
Skikda GL1K		Algeria	1972
Skikda GL1K		Algeria	1981
Skikda GL1K		Algeria	1999	6.0
Angola LNG	Soyo	Angola	2013	5.2	Chevron
Lumut 1		Brunei	1972	7.2
Badak NGL A-B	Bontang	Indonesia	1977	4	Pertamina
Badak NGL C-D	Bontang	Indonesia	1986	4.5	Pertamina
Badak NGL E	Bontang	Indonesia	1989	3.5	Pertamina
Badak NGL F	Bontang	Indonesia	1993	3.5	Pertamina
Badak NGL G	Bontang	Indonesia	1998	3.5	Pertamina
Badak NGL H	Bontang	Indonesia	1999	3.7	Pertamina
Darwin LNG	Darwin, NT	Australia	2006		ConocoPhillips
Donggi Senoro LNG	Luwuk	Indonesia	2014	2.2	Mitsubishi
Sengkang LNG	Sengkang	Indonesia	2014	5	Energy World Corp.
Atlantic LNG	Point Fortin	Trinidad and Tobago	1999		Atlantic LNG
[Atlantic LNG]	[Point Fortin]	Trinidad and Tobago	2003	9.9	Atlantic LNG
	Damietta	Egypt	2004	5.5	Segas LNG
	Idku	Egypt	2005	7.2
Bintulu MLNG 1		Malaysia	1983	7.6
Bintulu MLNG 2		Malaysia	1994	7.8
Bintulu MLNG 3		Malaysia	2003	3.4
Nigeria LNG		Nigeria	1999	23.5
Northwest Shelf Venture	Karratha	Australia	2009	16.3
Withnell Bay	Karratha	Australia	1989
Withnell Bay	Karratha	Australia	1995	(7.7)
Sakhalin II		Russia	2009	9.6.[13]
Yemen LNG	Balhaf	Yemen	2008	6.7
Tangguh LNG Project	Papua Barat	Indonesia	2009	7.6
Qatargas I	Ras Laffan	Qatar	1996	(4.0)
Qatargas I	Ras Laffan	Qatar	2005	10.0
Qatargas III		Qatar	2010	7.8
Rasgas I, II and III	Ras Laffan	Qatar	1999	36.3
Qalhat		Oman	2000	7.3
Das Island I		United Arab Emirates	1977
Das Island I and II		United Arab Emirates	1994	5.7
Melkøya	Hammerfest	Norway	2007	4.2	Statoil
Equatorial Guinea			2007	3.4	Marathon Oil
Risavika	Stavanger	Norway	2010	0.3	Risavika LNG Production[14]

§World total production[edit]

Global LNG import trends, by volume (in red), and as a percentage of global natural gas imports (in black) (US EIA data)

Trends in the top five LNG-importing nations as of 2009 (US EIA data)

Year	Capacity (Mtpa)	Notes
1990	50[15]
2002	130[16]
2007	160[15]

The LNG industry developed slowly during the second half of the last century because most LNG plants are located in remote areas not served by pipelines, and because of the large costs to treat and transport LNG. Constructing an LNG plant costs at least $1.5 billion per 1 mmtpa capacity, a receiving terminal costs $1 billion per 1 bcf/day throughput capacity and LNG vessels cost $200 million–$300 million.

In the early 2000s, prices for constructing LNG plants, receiving terminals and vessels fell as new technologies emerged and more players invested in liquefaction and regasification. This tended to make LNG more competitive as a means of energy distribution, but increasing material costs and demand for construction contractors have put upward pressure on prices in the last few years. The standard price for a 125,000 cubic meter LNG vessel built in European and Japanese shipyards used to be US$250 million. When Korean and Chinese shipyards entered the race, increased competition reduced profit margins and improved efficiency—reducing costs by 60 percent. Costs in US dollars also declined due to the devaluation of the currencies of the world's largest shipbuilders: the Japanese yen and Korean won.

Since 2004, the large number of orders increased demand for shipyard slots, raising their price and increasing ship costs. The per-ton construction cost of an LNG liquefaction plant fell steadily from the 1970s through the 1990s. The cost reduced by approximately 35 percent. However, recently the cost of building liquefaction and regasification terminals doubled due to increased cost of materials and a shortage of skilled labor, professional engineers, designers, managers and other white-collar professionals.

Due to energy shortage concerns, many new LNG terminals are being contemplated in the United States. Concerns about the safety of such facilities created controversy in some regions where they were proposed. One such location is in the Long Island Sound between Connecticut and Long Island. Broadwater Energy, an effort of TransCanada Corp. and Shell, wishes to build an LNG terminal in the sound on the New York side. Local politicians including the Suffolk County Executive raised questions about the terminal. In 2005, New York Senators Chuck Schumer and Hillary Clinton also announced their opposition to the project.^[17] Several terminal proposals along the coast of Maine were also met with high levels of resistance and questions. On Sep. 13, 2013 the U.S. Department of Energy approved Dominion Cove Point's application to export up to 770 million cubic feet per day of LNG to countries that do not have a free trade agreement with the U.S.^[18] In May 2014, the FERC concluded its environmental assessment of the Cove Point LNG project, which found that the proposed natural gas export project could be built and operated safely.^[19] Another LNG terminal is currently proposed for Elba Island, Ga.^[20] Plans for three LNG export terminals in the U.S. Gulf Coast region have also received conditional Federal approval.^[18][21] In Canada, an LNG export terminal is under construction near Guysborough, Nova Scotia.^[22]

§Commercial aspects

§Global Trade

In the commercial development of an LNG value chain, LNG suppliers first confirm sales to the downstream buyers and then sign long-term contracts (typically 20–25 years) with strict terms and structures for gas pricing. Only when the customers are confirmed and the development of a greenfield project deemed economically feasible, could the sponsors of an LNG project invest in their development and operation. Thus, the LNG liquefaction business has been limited to players with strong financial and political resources. Major international oil companies (IOCs) such as ExxonMobil, Royal Dutch Shell, BP, BG Group, Chevron, and national oil companies (NOCs) such as Pertamina and Petronas are active players.

LNG is shipped around the world in specially constructed seagoing vessels. The trade of LNG is completed by signing an SPA (sale and purchase agreement) between a supplier and receiving terminal, and by signing a GSA (gas sale agreement) between a receiving terminal and end-users. Most of the contract terms used to be DES or ex ship, holding the seller responsible for the transport of the gas. With low shipbuilding costs, and the buyers preferring to ensure reliable and stable supply, however, contract with the term of FOB increased. Under such term, the buyer, who often owns a vessel or signs a long-term charter agreement with independent carriers, is responsible for the transport.

LNG purchasing agreements used to be for a long term with relatively little flexibility both in price and volume. If the annual contract quantity is confirmed, the buyer is obliged to take and pay for the product, or pay for it even if not taken, in what is referred to as the obligation of take-or-pay contract (TOP).

In the mid-1990s, LNG was a buyer's market. At the request of buyers, the SPAs began to adopt some flexibilities on volume and price. The buyers had more upward and downward flexibilities in TOP, and short-term SPAs less than 16 years came into effect. At the same time, alternative destinations for cargo and arbitrage were also allowed. By the turn of the 21st century, the market was again in favor of sellers. However, sellers have become more sophisticated and are now proposing sharing of arbitrage opportunities and moving away from S-curve pricing. There has been much discussion regarding the creation of an "OGEC" as a natural gas equivalent of OPEC. Russia and Qatar, countries with the largest and the third largest natural gas reserves in the world, have finally supported such move.^{[citation needed]}

Until 2003, LNG prices have closely followed oil prices. Since then, LNG prices in Europe and Japan have been lower than oil prices, although the link between LNG and oil is still strong. In contrast, prices in the US and the UK have recently skyrocketed, then fallen as a result of changes in supply and storage.^{[citation needed]} In late 1990s and in early 2000s, the market shifted for buyers, but since 2003 and 2004, it has been a strong seller's market, with net-back as the best estimation for prices.^{[citation needed]}.

Research from QNB Group in 2014 shows that robust global demand is likely to keep LNG prices high for at least the next few years.^[23]

The current surge in unconventional oil and gas in the U.S. has resulted in lower gas prices in the U.S. This has led to discussions in Asia' oil linked gas markets to import gas based on Henry Hub index.^[24] Recent high level conference in Vancouver, the Pacific Energy Summit 2013 Pacific Energy Summit 2013 convened policy makers and experts from Asia and the U.S. to discuss LNG trade relations between these regions.

Receiving terminals exist in about 18 countries, including India, Japan, Korea, Taiwan, China, Greece, Belgium, Spain, Italy, France, the UK, the US, Chile, and the Dominican Republic, among others. Plans exist for Argentina, Brazil, Uruguay, Canada, Ukraine and others to also construct new receiving (gasification) terminals.

§Use of LNG to fuel large over-the-road trucks

LNG is in the early stages of becoming a mainstream fuel for transportation needs. It is being evaluated and tested for over-the-road trucking,^[25] off-road,^[26] marine, and train applications.^[27] There are known problems with the fuel tanks and delivery of gas to the engine,^[28] but despite these concerns the move to LNG as a transportation fuel has begun.

China has been a leader in the use of LNG vehicles^[29] with over 100,000 LNG powered vehicles on the road as of Sept 2014.^[30]

In the United States the beginnings of a public LNG Fueling capability is being put in place. An alternative fuel fueling center tracking site shows 69 public truck LNG fuel centers as of Feb 2015.^[31] The 2013 National Trucker's Directory lists approximately 7,000 truckstops,^[32] thus approximately 1% of US truckstops have LNG available.

In May 2013 Dillon Transport announced they were putting 25 LNG large trucks into service in Dallas Texas. They are refueling at a public LNG fuel center.^[33]

In Oct 2013 Raven Transportation announced they were buying 36 LNG large trucks to be fueled by Clean Energy Fuels locations.^[34]

In fall 2013, Lowe's finished converting one of its dedicated fleets to LNG fueled trucks.^[35]

UPS had over 1200 LNG fueled trucks on the roads in Feb 2015.^[36] UPS has 16,000 tractor trucks in its fleet, so it is approaching 10% of its fleet as LNG vehicles. 60 of the new for 2014 large trucks will be placed in service in the Houston, Texas area alone where UPS is building its own private LNG fuel center despite the availability of retail LNG capability. They state they need their own LNG fueling capacity to avoid the lines at a retail fuel center. UPS states the NGVs (natural gas vehicles) are no longer in the testing phase for them, they are vehicles they depend on.^[37] In other cities such as Amarillo, Texas and Oklahoma City, Oklahoma they are using public fuel centers.^[38]

Clean Energy Fuels has opened several public LNG Fuel Lanes along I-10 and claims that as of June 2014 LNG fueled trucks can use the route from Los Angeles, California to Houston, Texas by refueling exclusively at Clean Energy Fuels public facilities.^[39]

In the spring of 2014 Shell and Travel Centers of America opened the first of a planned network of U.S. truck stop LNG stations in Ontario, California.^[40] Per the alternative fuel fueling center tracking site there are 10 LNG capable public fuel stations in the greater Los Angeles area, making it the single most penetrated metro market.

As of Feb 2015, Blu LNG has at least 23 operational LNG capable fuel centers across 8 states.^[41]
Clean Energy maintains a list of their existing and planned LNG fuel centers.^[42] As of Feb 2015 they had 39 operational public LNG facilities.

As of December 2014 LNG fuel and NGV's have not been taken to very quickly within Europe and it is questionable whether LNG will ever become the fuel of choice among fleet operators.^[43]

§Trade

The global trade in LNG is growing rapidly from negligible in 1970 to what is expected to be a globally meaningful amount by 2020. As a reference, the 2014 global production of crude oil was 92 million barrels per day^[44] or 186.4 quads/yr (quadrillion BTUs/yr).

In 1970, global LNG trade was of 3 billion cubic metres (bcm) (0.11 quads).^[45] In 2011, it was 331 bcm (11.92 quads).^[45] The U.S. is expected to start exporting LNG in late 2015. The Black & Veatch Oct 2014 forecast is that by 2020, the U.S. alone will export between 10 Bcf/d (3.75 quads/yr) and 14 Bcf/d (5.25 quads/yr).^[46] E&Y projects global LNG demand could hit 400 mtpa (19.7 quads) by 2020.^[47] If that occurs, the LNG market will be roughly 10% the size of the global crude oil market, and that does not count the vast majority of natural gas which is delivered via pipeline directly from the well to the consumer.

In 2004, LNG accounted for 7 percent of the world’s natural gas demand.^[48] The global trade in LNG, which has increased at a rate of 7.4 percent per year over the decade from 1995 to 2005, is expected to continue to grow substantially.^[49] LNG trade is expected to increase at 6.7 percent per year from 2005 to 2020.^[49]

Until the mid-1990s, LNG demand was heavily concentrated in Northeast Asia: Japan, South Korea and Taiwan. At the same time, Pacific Basin supplies dominated world LNG trade.^[49] The world-wide interest in using natural gas-fired combined cycle generating units for electric power generation, coupled with the inability of North American and North Sea natural gas supplies to meet the growing demand, substantially broadened the regional markets for LNG. It also brought new Atlantic Basin and Middle East suppliers into the trade.^[49]

By the end of 2011, there were 18 LNG exporting countries and 25 LNG importing countries. The three biggest LNG exporters in 2011 were Qatar (75.5 MT), Malaysia (25 MT) and Indonesia (21.4 MT). The three biggest LNG importers in 2011 were Japan (78.8 MT), South Korea (35 MT) and UK (18.6 MT).^[50] LNG trade volumes increased from 140 MT in 2005 to 158 MT in 2006, 165 MT in 2007, 172 MT in 2008.^[51] IT was forecasted to be increased to about 200 MT in 2009, and about 300 MT in 2012. During the next several years there would be significant increase in volume of LNG Trade: about 82 MTPA of new LNG supply will come to the market between 2009 and 2011. For example, about 59 MTPA of new LNG supply from six new plants comes to the market just in 2009, including:

• Northwest Shelf Train 5: 4.4 MTPA
• Sakhalin II: 9.6 MTPA
• Yemen LNG: 6.7 MTPA
• Tangguh: 7.6 MTPA
• Qatargas: 15.6 MTPA
• Rasgas Qatar: 15.6 MTPA

In 2006, Qatar became the world's biggest exporter of LNG.^[45] As of 2012, Qatar is the source of 25 percent of the world's LNG exports.^[45]

Investments in U.S. export facilities were increasing by 2013—such as the plant being built in Hackberry, Louisiana by Sempra Energy. These investments were spurred by increasing shale gas production in the United States and a large price differential between natural gas prices in the U.S. and those in Europe and Asia. However, general exports had not yet been authorized by the United States Department of Energy because the United States had only recently moved from an importer to self-sufficiency status. When U.S. exports are authorized, large demand for LNG in Asia was expected to mitigate price decreases due to increased supplies from the U.S.^[52]

§Imports

In 1964, the UK and France made the first LNG trade, buying gas from Algeria, witnessing a new era of energy.

Today, only 19 countries export LNG.^[45]

Compared with the crude oil market, in 2013 the natural gas market was about 72 percent of the crude oil market (measured on a heat equivalent basis),^[53] of which LNG forms a small but rapidly growing part. Much of this growth is driven by the need for clean fuel and some substitution effect due to the high price of oil (primarily in the heating and electricity generation sectors).

Japan, South Korea, Spain, France, Italy and Taiwan import large volumes of LNG due to their shortage of energy. In 2005, Japan imported 58.6 million tons of LNG, representing some 30 percent of the LNG trade around the world that year. Also in 2005, South Korea imported 22.1 million tons, and in 2004 Taiwan imported 6.8 million tons. These three major buyers purchase approximately two-thirds of the world's LNG demand. In addition, Spain imported some 8.2 mmtpa in 2006, making it the third largest importer. France also imported similar quantities as Spain.^{[citation needed]} Following the Fukushima Daiichi nuclear disaster in March 2011 Japan became a major importer accounting for one third of the total.^[52] European LNG imports fell by 30 percent in 2012, and are expected to fall further by 24 percent in 2013, as South American and Asian importers pay more.^[54]

§Cargo diversion

Based on the LNG SPAs, LNG is destined for pre-agreed destinations, and diversion of that LNG is not allowed. However if Seller and Buyer make a mutual agreement, then the diversion of the cargo is permitted—subject to sharing the additional profit created by such a diversion. In the European Union and some other jurisdictions, it is not permitted to apply the profit-sharing clause in LNG SPAs.

§Cost of LNG plants

For an extended period of time, design improvements in liquefaction plants and tankers had the effect of reducing costs.

In the 1980s, the cost of building an LNG liquefaction plant cost $350 per tpa (tonne per year). In 2000s, it was $200/tpa. In 2012, the costs can go as high as $1,000/tpa, partly due to the increase in the price of steel.^[45]

As recently as 2003, it was common to assume that this was a “learning curve” effect and would continue into the future. But this perception of steadily falling costs for LNG has been dashed in the last several years.^[49]

The construction cost of greenfield LNG projects started to skyrocket from 2004 afterward and has increased from about $400 per ton per year of capacity to $1,000 per ton per year of capacity in 2008.

The main reasons for skyrocketed costs in LNG industry can be described as follows:

1. Low availability of EPC contractors as result of extraordinary high level of ongoing petroleum projects world wide.^[13]
2. High raw material prices as result of surge in demand for raw materials.
3. Lack of skilled and experienced workforce in LNG industry.^[13]
4. Devaluation of US dollar.

The 2007–2008 global financial crisis caused a general decline in raw material and equipment prices, which somewhat lessened the construction cost of LNG plants. However, by 2012 this was more than offset by increasing demand for materials and labor for the LNG market.

§Small-scale liquefaction plants

Small-scale liquefaction plants are advantageous because their compact size enables the production of LNG close to the location where it will be used. This proximity decreases transportation and LNG product costs for consumers. It also avoids the additional greenhouse gas emissions generated during long transportation.

The small-scale LNG plant also allows localized peakshaving to occur—balancing the availability of natural gas during high and low periods of demand. It also makes it possible for communities without access to natural gas pipelines to install local distribution systems and have them supplied with stored LNG.^[55]

§LNG pricing

There are three major pricing systems in the current LNG contracts:

• Oil indexed contract used primarily in Japan, Korea, Taiwan and China;
• Oil, oil products and other energy carriers indexed contracts used primarily in Continental Europe;^[56] and
• Market indexed contracts used in the US and the UK.;

The formula for an indexed price is as follows:
CP = BP + β X

• BP: constant part or base price
• β: gradient
• X: indexation

The formula has been widely used in Asian LNG SPAs, where base price refers to a term that represents various non-oil factors, but usually a constant determined by negotiation at a level which can prevent LNG prices from falling below a certain level. It thus varies regardless of oil price fluctuation.

§Oil parity

Oil parity is the LNG price that would be equal to that of crude oil on a Barrel of oil equivalent basis. If the LNG price exceeds the price of crude oil in BOE terms, then the situation is called broken oil parity. A coefficient of 0.1724 results in full oil parity. In most cases the price of LNG is less the price of crude oil in BOE terms. In 2009, in several spot cargo deals especially in East Asia, oil parity approached the full oil parity or even exceeds oil parity.^[57]

§S-curve

Many formulae include an S-curve, where the price formula is different above and below a certain oil price, to dampen the impact of high oil prices on the buyer, and low oil prices on the seller.

§JCC and ICP

In most of the East Asian LNG contracts, price formula is indexed to a basket of crude imported to Japan called the Japan Crude Cocktail (JCC). In Indonesian LNG contracts, price formula is linked to Indonesian Crude Price (ICP).

§Brent and other energy carriers

In continental Europe, the price formula indexation does not follow the same format, and it varies from contract to contract. Brent crude price (B), heavy fuel oil price (HFO), light fuel oil price (LFO), gas oil price (GO), coal price, electricity price and in some cases, consumer and producer price indexes are the indexation elements of price formulas.

§Price review

Usually there exists a clause allowing parties to trigger the price revision or price reopening in LNG SPAs. In some contracts there are two options for triggering a price revision. regular and special. Regular ones are the dates that will be agreed and defined in the LNG SPAs for the purpose of price review.

§Quality of LNG

LNG quality is one of the most important issues in the LNG business. Any gas which does not conform to the agreed specifications in the sale and purchase agreement is regarded as “off-specification” (off-spec) or “off-quality” gas or LNG. Quality regulations serve three purposes:^[58]

1 - to ensure that the gas distributed is non-corrosive and non-toxic, below the upper limits for H₂S, total sulphur, CO₂ and Hg content;

2 - to guard against the formation of liquids or hydrates in the networks, through maximum water and hydrocarbon dewpoints;

3 - to allow interchangeability of the gases distributed, via limits on the variation range for parameters affecting combustion: content of inert gases, calorific value, Wobbe index, Soot Index, Incomplete Combustion Factor, Yellow Tip Index, etc.

In the case of off-spec gas or LNG the buyer can refuse to accept the gas or LNG and the seller has to pay liquidated damages for the respective off-spec gas volumes.

The quality of gas or LNG is measured at delivery point by using an instrument such as a gas chromatograph.

The most important gas quality concerns involve the sulphur and mercury content and the calorific value. Due to the sensitivity of liquefaction facilities to sulfur and mercury elements, the gas being sent to the liquefaction process shall be accurately refined and tested in order to assure the minimum possible concentration of these two elements before entering the liquefaction plant, hence there is not much concern about them.

However, the main concern is the heating value of gas. Usually natural gas markets can be divided in three markets in terms of heating value:^[58]

• Asia (Japan, Korea, Taiwan) where gas distributed is rich, with a gross calorific value (GCV) higher than 43 MJ/m³(n), i.e. 1,090 Btu/scf,
• the UK and the US, where distributed gas is lean, with a GCV usually lower than 42 MJ/m³(n), i.e. 1,065 Btu/scf,
• Continental Europe, where the acceptable GCV range is quite wide: approx. 39 to 46 MJ/m³(n), i.e. 990 to 1,160 Btu/scf.

There are some methods to modify the heating value of produced LNG to the desired level. For the purpose of increasing the heating value, injecting propane and butane is a solution. For the purpose of decreasing heating value, nitrogen injecting and extracting butane and propane are proved solutions.
Blending with gas or LNG can be a solutions; however all of these solutions while theoretically viable can be costly and logistically difficult to manage in large scale.

§Liquefaction technology

Currently there are four Liquefaction processes available:

1. C3MR (sometimes referred to as APCI): designed by Air Products & Chemicals, Incorporation.
2. Cascade: designed by ConocoPhillips.
3. Shell DMR
4. Linde

It was expected that by the end of 2012, there will be 100 liquefaction trains on stream with total capacity of 297.2 Mt/year (MMTPA).

The majority of these trains use either APCI or Cascade technology for the liquefaction process. The other processes, used in a small minority of some liquefaction plants, include Shell's DMR (double-mixed refrigerant) technology and the Linde technology.

APCI technology is the most-used liquefaction process in LNG plants: out of 100 liquefaction trains onstream or under-construction, 86 trains with a total capacity of 243 MMTPA have been designed based on the APCI process. Philips Cascade process is the second most-used, used in 10 trains with a total capacity of 36.16 MMTPA. The Shell DMR process has been used in three trains with total capacity of 13.9 MMTPA; and, finally, the Linde/Statoil process is used in the Snohvit 4.2 MMTPA single train.

Floating liquefied natural gas (FLNG) facilities float above an offshore gas field, and produce, liquefy, store and transfer LNG (and potentially LPG and condensate) at sea before carriers ship it directly to markets. The first FLNG facility is now in development by Shell,^[59] due for completion in around 2017.^[60]

§Storage

LNG storage tank at EG LNG

Modern LNG storage tanks are typically full containment type, which has a prestressed concrete outer wall and a high-nickel steel inner tank, with extremely efficient insulation between the walls. Large tanks are low aspect ratio (height to width) and cylindrical in design with a domed steel or concrete roof. Storage pressure in these tanks is very low, less than 10 kPa (1.45 psig). Sometimes more expensive underground tanks are used for storage. Smaller quantities (say 700 m³ (190,000 US gallons) and less), may be stored in horizontal or vertical, vacuum-jacketed, pressure vessels. These tanks may be at pressures anywhere from less than 50 kPa to over 1,700 kPa (7 psig to 250 psig).

LNG must be kept cold to remain a liquid, independent of pressure. Despite efficient insulation, there will inevitably be some heat leakage into the LNG, resulting in vaporisation of the LNG. This boil-off gas acts to keep the LNG cold. The boil-off gas is typically compressed and exported as natural gas, or it is reliquefied and returned to storage.

§Transportation

Tanker LNG Rivers, LNG capacity of 135,000 cubic metres

LNG is transported in specially designed ships with double hulls protecting the cargo systems from damage or leaks. There are several special leak test methods available to test the integrity of an LNG vessel's membrane cargo tanks.^[61]

The tankers cost around US$200 million each.^[45]

Transportation and supply is an important aspect of the gas business, since natural gas reserves are normally quite distant from consumer markets. Natural gas has far more volume than oil to transport, and most gas is transported by pipelines. There is a natural gas pipeline network in the former Soviet Union, Europe and North America. Natural gas is less dense, even at higher pressures. Natural gas will travel much faster than oil through a high-pressure pipeline, but can transmit only about a fifth of the amount of energy per day due to the lower density. Natural gas is usually liquefied to LNG at the end of the pipeline, prior to shipping.

Short LNG pipelines for use in moving product from LNG vessels to onshore storage are available. Longer pipelines, which allow vessels to offload LNG at a greater distance from port facilities are under development. This requires pipe in pipe technology due to requirements for keeping the LNG cold.^[62]

LNG is transported using both tanker truck,^[63] railway tanker, and purpose built ships known as LNG carriers. LNG will be sometimes taken to cryogenic temperatures to increase the tanker capacity. The first commercial ship-to-ship transfer (STS) transfers were undertaken in February 2007 at the Flotta facility in Scapa Flow^[64] with 132,000 m³ of LNG being passed between the vessels Excalibur and Excelsior. Transfers have also been carried out by Exmar Shipmanagement, the Belgian gas tanker owner in the Gulf of Mexico, which involved the transfer of LNG from a conventional LNG carrier to an LNG regasification vessel (LNGRV). Prior to this commercial exercise LNG had only ever been transferred between ships on a handful of occasions as a necessity following an incident.^{[citation needed]}

§Terminals

Liquefied natural gas is used to transport natural gas over long distances, often by sea. In most cases, LNG terminals are purpose-built ports used exclusively to export or import LNG.

§Refrigeration

The insulation, as efficient as it is, will not keep LNG cold enough by itself. Inevitably, heat leakage will warm and vapourise the LNG. Industry practice is to store LNG as a boiling cryogen. That is, the liquid is stored at its boiling point for the pressure at which it is stored (atmospheric pressure). As the vapour boils off, heat for the phase change cools the remaining liquid. Because the insulation is very efficient, only a relatively small amount of boil off is necessary to maintain temperature. This phenomenon is also called auto-refrigeration.

Boil off gas from land based LNG storage tanks is usually compressed and fed to natural gas pipeline networks. Some LNG carriers use boil off gas for fuel.

§Environmental concerns

Natural gas could be considered the most environmentally friendly fossil fuel, because it has the lowest CO₂ emissions per unit of energy and because it is suitable for use in high efficiency combined cycle power stations. For an equivalent amount of heat, burning natural gas produces about 30 per cent less carbon dioxide than burning petroleum and about 45 per cent less than burning coal. ^[65] On a per kilometre transported basis, emissions from LNG are lower than piped natural gas, which is a particular issue in Europe, where significant amounts of gas are piped several thousand kilometres from Russia. However, emissions from natural gas transported as LNG are higher than for natural gas produced locally to the point of combustion as emissions associated with transport are lower for the latter.^{[citation needed]}

However, on the West Coast of the United States, where up to three new LNG importation terminals have been proposed, environmental groups, such as Pacific Environment, Ratepayers for Affordable Clean Energy (RACE), and Rising Tide have moved to oppose them.^[66] They claim that, while natural gas power plants emit approximately half the carbon dioxide of an equivalent coal power plant, the natural gas combustion required to produce and transport LNG to the plants adds 20 to 40 percent more carbon dioxide than burning natural gas alone.^[67]

Green bordered white diamond symbol used on LNG-powered vehicles in China

§Safety and accidents

Natural gas is a fuel and a combustible substance. To ensure safe and reliable operation, particular measures are taken in the design, construction and operation of LNG facilities.

In its liquid state, LNG is not explosive and can not burn. For LNG to burn, it must first vaporize, then mix with air in the proper proportions (the flammable range is 5 percent to 15 percent), and then be ignited. In the case of a leak, LNG vaporizes rapidly, turning into a gas (methane plus trace gases), and mixing with air. If this mixture is within the flammable range, there is risk of ignition which would create fire and thermal radiation hazards.

Gas venting from vehicles powered by LNG may create a flammability hazard if parked indoors for longer than a week. Additionally, due to its low temperature, refueling a LNG-powered vehicle requires training to avoid the risk of frostbite.^[68]

LNG tankers have sailed over 100 million miles without a shipboard death or even a major accident.^[69]

Several on-site accidents involving or related to LNG are listed below:

• 1944, Oct. 20. The East Ohio Natural Gas Co. experienced a failure of an LNG tank in Cleveland, Ohio.^[70] 128 people perished in the explosion and fire. The tank did not have a dike retaining wall, and it was made during World War II, when metal rationing was very strict. The steel of the tank was made with an extremely low amount of nickel, which meant the tank was brittle when exposed to the cryogenic nature of LNG. The tank ruptured, spilling LNG into the city sewer system. The LNG vaporized and turned into gas, which exploded and burned.
• 1979, Oct. 6, Lusby, Maryland, at the Cove Point LNG facility a pump seal failed, releasing natural gas vapors (not LNG), which entered and settled in an electrical conduit.^[70] A worker switched off a circuit breaker, which ignited the gas vapors. The resulting explosion killed a worker, severely injured another and caused heavy damage to the building. A safety analysis was not required at the time, and none was performed during the planning, design or construction of the facility.^[71] National fire codes were changed as a result of the accident.
• 2004, Jan. 19, Skikda, Algeria. Explosion at Sonatrach LNG liquefaction facility.^[70] 27 killed, 56 injured, three LNG trains destroyed, a marine berth was damaged and 2004 production was down 76 percent for the year. Total loss was US$900 million. A steam boiler that was part of an LNG liquefaction train exploded triggering a massive hydrocarbon gas explosion. The explosion occurred where propane and ethane refrigeration storage were located. Site distribution of the units caused a domino effect of explosions.^[72][73] It remains unclear if LNG or LNG vapour, or other hydrocarbon gases forming part of the liquefaction process initiated the explosions. One report, of the US Government Team Site Inspection of the Sonatrach Skikda LNG Plant in Skikda, Algeria, March 12–16, 2004, has cited it was a leak of hydrocarbons from the refrigerant (liquefaction) process system.

Sustainable development

From Wikipedia, the free encyclopedia

Wind powers 5MW wind turbines on a wind farm 28 km off the coast of Belgium.

Sustainable development (SD) is a process for achieving sustainability in any activity that uses resources and where immediate and intergenerational replication is demanded. Sustainable development coincides with further economic growth and human development in the developed economy (and society) for finding the means ^[1] of continual development beyond economic development. As such, sustainable development is the organizing principle for sustaining finite resources necessary to provide for the needs of future generations of life on the planet. It is a process that envisions a desirable future state for human societies in which living conditions and resource-use continue to meet human needs without undermining the "integrity, stability and beauty" of natural biotic systems.^[2]

§History

Sustainability can be defined as the practice of maintaining processes of productivity indefinitely—natural or human made—by replacing resources used with resources of equal or greater value without degrading or endangering natural biotic systems.^{[3][unreliable source?][4]} Sustainable development ties together concern for the carrying capacity of natural systems with the social, political, and economic challenges faced by humanity. Sustainability science is the study of the concepts of sustainable development and environmental science. There is an additional focus on the present generations' responsibility to regenerate, maintain and improve planetary resources for use by future generations.^[5]

Sustainable development has its roots in ideas about sustainable forest management which were developed in Europe during the seventeenth and eighteenth centuries.^[6][7] In response to a growing aware of the depletion of timber resources in England, John Evelyn argued that "sowing and planting of trees had to be regarded as a national duty of every landowner, in order to stop the destructive over-exploitation of natural resources" in his 1662 essay Sylva. In 1713 Hans Carl von Carlowitz, a senior mining administrator in the service of Elector Frederick Augustus I of Saxony published Sylvicultura oeconomica, a 400-page work on forestry. Building upon the ideas of Evelyn and French minister Jean-Baptiste Colbert, von Carlowitz developed the concept of managing forests for sustained yield.^[6] His work influenced others, including Alexander von Humboldt and Georg Ludwig Hartig, leading in turn to the development of a science of forestry. This in term influenced people like Gifford Pinchot, first head of the US Forest Service, whose approach to forest management was driven by the idea of wise use of resources, and Aldo Leopold whose land ethic was influential in the development of the environmental movement in the 1960s.^[6][7]

Following the publication of Rachel Carson's Silent Spring in 1962, the developing environmental movement drew attention to the relationship between economic growth and development and environmental degradation. Kenneth E. Boulding in his influential 1966 essay The Economics of the Coming Spaceship Earth identified the need for the economic system to fit itself to the ecological system with its limited pools of resources.^[7] One of the first uses of the term sustainable in the contemporary sense was by the Club of Rome in 1972 in its classic report on the Limits to Growth, written by a group of scientists led by Dennis and Donella Meadows of the Massachusetts Institute of Technology. Describing the desirable "state of global equilibrium", the authors wrote: "We are searching for a model output that represents a world system that is sustainable without sudden and uncontrolled collapse and capable of satisfying the basic material requirements of all of its people."^[5]

In 1980 the International Union for the Conservation of Nature published a world conservation strategy that included one of the first references to sustainable development as a global priority.^[8] Two years later, the United Nations World Charter for Nature raised five principles of conservation by which human conduct affecting nature is to be guided and judged.^[9] In 1987 the United Nations World Commission on Environment and Development released the report Our Common Future, commonly called the Brundtland Report. The report included what is now one of the most widely recognised definitions of sustainable development.^[10][11]

“	Sustainable development is development that meets the needs of the present without compromising the ability of future generations to meet their own needs. It contains within it two key concepts: · The concept of 'needs', in particular, the essential needs of the world's poor, to which overriding priority should be given; and · The idea of limitations imposed by the state of technology and social organization on the environment's ability to meet present and future needs.	”
—World Commission on Environment and Development, Our Common Future (1987)

In 1992, the UN Conference on Environment and Development published in 1992 the Earth Charter, which outlines the building of a just, sustainable, and peaceful global society in the 21st century. The action plan Agenda 21 for sustainable development identified information, integration, and participation as key building blocks to help countries achieve development that recognizes these interdependent pillars. It emphasises that in sustainable development everyone is a user and provider of information. It stresses the need to change from old sector-centered ways of doing business to new approaches that involve cross-sectoral co-ordination and the integration of environmental and social concerns into all development processes. Furthermore, Agenda 21 emphasises that broad public participation in decision making is a fundamental prerequisite for achieving sustainable development.^[12] Under the principles of the United Nations Charter the Millennium Declaration identified principles and treaties on sustainable development, including economic development, social development and environmental protection. Broadly defined, sustainable development is a systems approach to growth and development and to manage natural, produced, and social capital for the welfare of their own and future generations. The term sustainable development as used by the United Nations incorporates both issues associated with land development and broader issues of human development such as education, public health, and standard of living.^{[citation needed]}

The UN Commission on Sustainable Development integrated sustainable development into the UN System. Indigenous peoples have argued, through various international forums such as the United Nations Permanent Forum on Indigenous Issues and the Convention on Biological Diversity, that there are four pillars of sustainable development, the fourth being cultural. The Universal Declaration on Cultural Diversity from 2001 states: "... cultural diversity is as necessary for humankind as biodiversity is for nature"; it becomes "one of the roots of development understood not simply in terms of economic growth, but also as a means to achieve a more satisfactory intellectual, emotional, moral and spiritual existence".^[13]

The proposed changes were supported by a study in 2013, which concluded that sustainability reporting should be reframed through the lens of four interconnected domains: ecology, economics, politics and culture.^[14]

§Domains

Different domains have been identified for research and analysis of sustainable development. Broadly defined, these include ecology, economics, politics and culture^[15] — as used by the United Nations and a number of other international organizations.^[16]

§Ecology

Relationship between ecological footprint and Human Development Index (HDI)

The ecological sustainability of human settlements is part of the relationship between humans and their natural, social and built environments.^[17] Also termed human ecology, this broadens the focus of sustainable development to include the domain of human health. Fundamental human needs such as the availability and quality of air, water, food and shelter are also the ecological foundations for sustainable development;^[18] addressing public health risk through investments in ecosystem services can be a powerful and transformative force for sustainable development which, in this sense, extends to all species.^[19]

§Agriculture[edit]

Sustainable agriculture consists of environmentally-friendly methods of farming that allow the production of crops or livestock without damage to human or natural systems. It involves preventing adverse effects to soil, water, biodiversity, surrounding or downstream resources—as well as to those working or living on the farm or in neighboring areas. The concept of sustainable agriculture extends intergenerationally, passing on a conserved or improved natural resource, biotic, and economic base rather than one which has been depleted or polluted.^[20] Elements of sustainable agriculture include permaculture, agroforestry, mixed farming, multiple cropping, and crop rotation.^[21]
Numerous sustainability standards and certification systems have been established in recent years, offering consumer choices for sustainable agriculture practices. These include Organic certification, Rainforest Alliance, Fair Trade, UTZ Certified, Bird Friendly, and the Common Code for the Coffee Community (4C).^[22][23]

§Energy

Sustainable energy is the sustainable provision of energy that is clean and lasts for a long period of time. Unlike the fossil fuel that most of the countries are using, renewable energy only produces little or even no pollution.^[24] The most common types of renewable energy in US are solar and wind energy, solar energy are commonly used on public parking meter, street lights and the roof of buildings.^[25] Wind energy has expanded quickly, generating 12,000 MW in 2013. The largest wind power station is in Texas and California.^[26][27] Household energy consumption can also be improved in a sustainable way, like using electronics with Energy Star logos which conserve water and energy. Most of California’s fossil fuel infrastructures are sited in or near low-income communities, and have traditionally suffered the most from California’s fossil fuel energy system. These communities are historically left out during the decision-making process, and often end up with dirty power plants and other dirty energy projects that poison the air and harm the area. These toxins are major contributors to health problems in the communities. As renewable energy becomes more common, fossil fuel infrastructures is replaced by renewables, providing better social equity to these community.^[28]

§Environment

The Blue Marble, photographed from Apollo 17 in 1972, quickly became an icon of environmental conservation.^[29]

Environmental sustainability concerns the natural environment and how it endures and remains diverse and productive. Since natural resources are derived from the environment, the state of air, water, and the climate are of particular concern. The IPCC Fifth Assessment Report outlines current knowledge about scientific, technical and socio-economic information concerning climate change, and lists options for adaptation and mitigation.^[30] Environmental sustainability requires society to design activities to meet human needs while preserving the life support systems of the planet. This, for example, entails using water sustainably, utilizing renewable energy, and sustainable material supplies (e.g. harvesting wood from forests at a rate that maintains the biomass and biodiversity).^{[citation needed]}

An unsustainable situation occurs when natural capital (the sum total of nature's resources) is used up faster than it can be replenished. Sustainability requires that human activity only uses nature's resources at a rate at which they can be replenished naturally. Inherently the concept of sustainable development is intertwined with the concept of carrying capacity. Theoretically, the long-term result of environmental degradation is the inability to sustain human life. Such degradation on a global scale should imply an increase in human death rate until population falls to what the degraded environment can support. If the degradation continues beyond a certain tipping point or critical threshold it would lead to eventual extinction for humanity.^{[citation needed]}

Consumption of renewable resources	State of environment	Sustainability
More than nature's ability to replenish	Environmental degradation	Not sustainable
Equal to nature's ability to replenish	Environmental equilibrium	Steady state economy
Less than nature's ability to replenish	Environmental renewal	Environmentally sustainable

§Transportation

Transportation is a large contributor to greenhouse gas emissions. It is said that one-third of all gasses produced are due to transportation.^[31] Some western countries are making transportation more sustainable in both long-term and short-term implementations.^[32] One great example of this is the transportation changes done in the city of Freiburg, Germany. The city has implemented extensive methods of public transportation, cycling, and walking, along with large areas where cars are not allowed.^[31]

Since many western countries are highly automobile-orientated areas, the main transit that people use is personal vehicles. About 80% of their travel involves cars.^[31] Therefore, California, deep in the automobile-oriented west, is one of the highest greenhouse gases emitters in the country. The federal government has to come up with some plans to reduce the total number of vehicle trips in order to lower greenhouse gases emission. Such as:

• Improve public transit through the provision of larger coverage area in order to provide more mobility and accessibility, new technology to provide a more reliable and responsive public transportation network.^[33]

• Encourage walking and biking through the provision of wider pedestrian pathway, bike share station in commercial downtown, locate parking lot far from the shopping center, limit on street parking, slower traffic lane in downtown area.

• Increase the cost of car ownership and gas taxes through increased parking fees and tolls, encouraging people to drive more fuel efficient vehicles. The can produce social equity problem, since lower people usually drive older vehicles with lower fuel efficiency. Government can use the extra revenue collected from taxes and tolls to improve the public transportation and benefit the poor community.^[34]

§Economics

A sewage treatment plant that uses solar energy, located at Santuari de Lluc monastery, Majorca.

It has been suggested that because of rural poverty and overexploitation, environmental resources should be treated as important economic assets, called natural capital.^[35] Economic development has traditionally required a growth in the gross domestic product. This model of unlimited personal and GDP growth may be over.^[36] Sustainable development may involve improvements in the quality of life for many but may necessitate a decrease in resource consumption.^[37] According to ecological economist Malte Faber, ecological economics is defined by its focus on nature, justice, and time. Issues of intergenerational equity, irreversibility of environmental change, uncertainty of long-term outcomes, and sustainable development guide ecological economic analysis and valuation.^[38]

As early as the 1970s, the concept of sustainability was used to describe an economy "in equilibrium with basic ecological support systems."^[39] Scientists in many fields have highlighted The Limits to Growth,^[40][41] and economists have presented alternatives, for example a 'steady state economy';^[42] to address concerns over the impacts of expanding human development on the planet. In 1987 the economist Edward Barbier published the study The Concept of Sustainable Economic Development, where he recognized that goals of environmental conservation and economic development are not conflicting and can be reinforcing each other.^[43]

A World Bank study from 1999 concluded that based on the theory of genuine savings, policymakers have many possible interventions to increase sustainability, in macroeconomics or purely environmental.^[44] A study from 2001 noted that efficient policies for renewable energy and pollution are compatible with increasing human welfare, eventually reaching a golden-rule steady state.^[45] The study, Interpreting Sustainability in Economic Terms, found three pillars of sustainable development, interlinkage, intergenerational equity, and dynamic efficiency.^[46]

A meta review in 2002 looked at environmental and economic valuations and found a lack of “sustainability policies”.^[47] A study in 2004 asked if we consume too much.^[48] A study concluded in 2007 that knowledge, manufactured and human capital(health and education) has not compensated for the degradation of natural capital in many parts of the world.^[49] It has been suggested that intergenerational equity can be incorporated into a sustainable development and decision making, as has become common in economic valuations of climate economics.^[50] A meta review in 2009 identified conditions for a strong case to act on climate change, and called for more work to fully account of the relevant economics and how it affects human welfare.^[51] According to John Baden^[52] “the improvement of environment quality depends on the market economy and the existence of legitimate and protected property rights.” They enable the effective practice of personal responsibility and the development of mechanisms to protect the environment. The State can in this context “create conditions which encourage the people to save the environment.”^[53]

§Business

The most broadly accepted criterion for corporate sustainability constitutes a firm’s efficient use of natural capital. This eco-efficiency is usually calculated as the economic value added by a firm in relation to its aggregated ecological impact.^[54] This idea has been popularised by the World Business Council for Sustainable Development (WBCSD) under the following definition: "Eco-efficiency is achieved by the delivery of competitively priced goods and services that satisfy human needs and bring quality of life, while progressively reducing ecological impacts and resource intensity throughout the life-cycle to a level at least in line with the earth’s carrying capacity." (DeSimone and Popoff, 1997: 47)^[55]
Similar to the eco-efficiency concept but so far less explored is the second criterion for corporate sustainability. Socio-efficiency^[56] describes the relation between a firm's value added and its social impact. Whereas, it can be assumed that most corporate impacts on the environment are negative (apart from rare exceptions such as the planting of trees) this is not true for social impacts. These can be either positive (e.g. corporate giving, creation of employment) or negative (e.g. work accidents, mobbing of employees, human rights abuses). Depending on the type of impact socio-efficiency thus either tries to minimize negative social impacts (i.e. accidents per value added) or maximise positive social impacts (i.e. donations per value added) in relation to the value added.^{[citation needed]}

Both eco-efficiency and socio-efficiency are concerned primarily with increasing economic sustainability. In this process they instrumentalize both natural and social capital aiming to benefit from win-win situations. However, as Dyllick and Hockerts^[56] point out the business case alone will not be sufficient to realise sustainable development. They point towards eco-effectiveness, socio-effectiveness, sufficiency, and eco-equity as four criteria that need to be met if sustainable development is to be reached.^{[citation needed]}

§Income

At the present time, sustainable development as well as solidarity or Catholic social teaching can impact reduce the poverty. Because over many thousands of years the ‘stronger’ (economically or physically) used to defeat/eliminate the weaker, nowadays, no matter what we call the reason for this decision – within Catholic social teaching, social solidarity, and sustainable development – the stronger helps the weaker. This aid may take the form of in-kind or material, refer to the present or the future. ‘The Stronger’, should offer real help and not, as demonstrated by the frequent experience – strive for the elimination or annihilation of another entity. Sustainable development reduce poverty through economic (among other things, a balanced budget), environmental (living conditions) and also social (including equality of income) dimensions.^[57]

§Architecture

In sustainable architecture the recent movements of New Urbanism and New Classical architecture promote a sustainable approach towards construction, that appreciates and develops smart growth, architectural tradition and classical design.^[58][59] This in contrast to modernist and globally uniform architecture, as well as opposing to solitary housing estates and suburban sprawl, with long commuting distances and large ecological footprints.^[60] Both trends started in the 1980s. (It should be noted that sustainable architecture is predominantly relevant to the economics domain while architectural landscaping pertains more to the ecological domain.)^{[citation needed]}

§Politics

A study concluded that social indicators and, therefore, sustainable development indicators, are scientific constructs whose principal objective is to inform public policy-making.^[61] The International Institute for Sustainable Development has similarly developed a political policy framework, linked to a sustainability index for establishing measurable entities and metrics. The framework consists of six core areas, international trade and investment, economic policy, climate change and energy, measurement and assessment, natural resource management, and the role of communication technologies in sustainable development.
The United Nations Global Compact Cities Programme has defined sustainable political development is a way that broadens the usual definition beyond states and governance. The political is defined as the domain of practices and meanings associated with basic issues of social power as they pertain to the organisation, authorisation, legitimation and regulation of a social life held in common. This definition is in accord with the view that political change is important for responding to economic, ecological and cultural challenges. It also means that the politics of economic change can be addressed. They have listed seven subdomains of the domain of politics:^[62]

1. Organization and governance
2. Law and justice
3. Communication and critique
4. Representation and negotiation
5. Security and accord
6. Dialogue and reconciliation
7. Ethics and accountability

This accords with the Brundtland Commission emphasis on development that is guided by human rights principles (see above).

§Culture

Framing of sustainable development progress according to the Circles of Sustainability, used by the United Nations.

Working with a different emphasis, some researchers and institutions have pointed out that a fourth dimension should be added to the dimensions of sustainable development, since the triple-bottom-line dimensions of economic, environmental and social do not seem to be enough to reflect the complexity of contemporary society. In this context, the Agenda 21 for culture and the United Cities and Local Governments (UCLG) Executive Bureau lead the preparation of the policy statement “Culture: Fourth Pillar of Sustainable Development”, passed on 17 November 2010, in the framework of the World Summit of Local and Regional Leaders – 3rd World Congress of UCLG, held in Mexico City. although some which still argue that economics is primary, and culture and politics should be included in 'the social'. This document inaugurates a new perspective and points to the relation between culture and sustainable development through a dual approach: developing a solid cultural policy and advocating a cultural dimension in all public policies. The Circles of Sustainability approach distinguishes the four domains of economic, ecological, political and cultural sustainability.^[63][64]

Other organizations have also supported the idea of a fourth domain of sustainable development. The Network of Excellence "Sustainable Development in a Diverse World",^[65] sponsored by the European Union, integrates multidisciplinary capacities and interprets cultural diversity as a key element of a new strategy for sustainable development. The Fourth Pillar of Sustainable Development Theory has been referenced by executive director of IMI Institute at UNESCO Vito Di Bari^[66] in his manifesto of art and architectural movement Neo-Futurism, whose name was inspired by the 1987 United Nations’ report Our Common Future. The Circles of Sustainability approach used by Metropolis defines the (fourth) cultural domain as practices, discourses, and material expressions, which, over time, express continuities and discontinuities of social meaning.^[62]

§Themes

§Progress[edit]

The United Nations Conference on Sustainable Development (UNCSD), also known as Rio 2012, Rio+20, or Earth Summit 2012, was the third international conference on sustainable development, which aimed at reconciling the economic and environmental goals of the global community. Few nations met the World Wide Fund for Nature's definition of sustainable development criteria established in 2006.^[67]

§Measurement

Deforestation and increased road-building in the Amazon Rainforest are a concern because of increased human encroachment upon wilderness areas, increased resource extraction and further threats to biodiversity.

In 2007 a report for the U.S. Environmental Protection Agency stated: “While much discussion and effort has gone into sustainability indicators, none of the resulting systems clearly tells us whether our society is sustainable. At best, they can tell us that we are heading in the wrong direction, or that our current activities are not sustainable. More often, they simply draw our attention to the existence of problems, doing little to tell us the origin of those problems and nothing to tell us how to solve them.”^[68] Nevertheless a majority of authors assume that a set of well defined and harmonised indicators is the only way to make sustainability tangible. Those indicators are expected to be identified and adjusted through empirical observations (trial and error).^[69]

The most common critiques are related to issues like data quality, comparability, objective function and the necessary resources.^[70] However a more general criticism is coming from the project management community: How can a sustainable development be achieved at global level if we cannot monitor it in any single project?^[71][72]

The Cuban-born researcher and entrepreneur Sonia Bueno suggests an alternative approach that is based upon the integral, long-term cost-benefit relationship as a measure and monitoring tool for the sustainability of every project, activity or enterprise.^[73][74] Furthermore this concept aims to be a practical guideline towards sustainable development following the principle of conservation and increment of value rather than restricting the consumption of resources.^{[citation needed]}

Reasonable qualifications of sustainability are seen U.S. Green Building Council’s (USGBC) Leadership in Energy and Environmental Design (LEED). This design incorporates some ecological, economic, and social elements. The goals presented by LEED design goals are sustainable sites, water efficiency, energy and atmospheric emission reduction, material and resources efficiency, and indoor environmental quality. Although amount of structures for sustainability development is many, these qualification has become a standard for sustainable building.^{[citation needed]}

§Natural capital

Deforestation of native rain forest in Rio de Janeiro City for extraction of clay for civil engineering (2009 picture).

The sustainable development debate is based on the assumption that societies need to manage three types of capital (economic, social, and natural), which may be non-substitutable and whose consumption might be irreversible.^[75] Daly (1991),^[42] for example, points to the fact that natural capital can not necessarily be substituted by economic capital. While it is possible that we can find ways to replace some natural resources, it is much more unlikely that they will ever be able to replace eco-system services, such as the protection provided by the ozone layer, or the climate stabilizing function of the Amazonian forest. In fact natural capital, social capital and economic capital are often complementarities. A further obstacle to substitutability lies also in the multi-functionality of many natural resources. Forests, for example, not only provide the raw material for paper (which can be substituted quite easily), but they also maintain biodiversity, regulate water flow, and absorb CO2.^{[citation needed]}

Another problem of natural and social capital deterioration lies in their partial irreversibility. The loss in biodiversity, for example, is often definite. The same can be true for cultural diversity. For example with globalisation advancing quickly the number of indigenous languages is dropping at alarming rates. Moreover, the depletion of natural and social capital may have non-linear consequences. Consumption of natural and social capital may have no observable impact until a certain threshold is reached. A lake can, for example, absorb nutrients for a long time while actually increasing its productivity. However, once a certain level of algae is reached lack of oxygen causes the lake’s ecosystem to break down suddenly.^{[citation needed]}

§Business-as-usual

Before flue-gas desulfurization was installed, the air-polluting emissions from this power plant in New Mexico contained excessive amounts of sulfur dioxide.

If the degradation of natural and social capital has such important consequence the question arises why action is not taken more systematically to alleviate it. Cohen and Winn^[76] point to four types of market failure as possible explanations: First, while the benefits of natural or social capital depletion can usually be privatized, the costs are often externalized (i.e. they are borne not by the party responsible but by society in general). Second, natural capital is often undervalued by society since we are not fully aware of the real cost of the depletion of natural capital. Information asymmetry is a third reason—often the link between cause and effect is obscured, making it difficult for actors to make informed choices. Cohen and Winn close with the realization that contrary to economic theory many firms are not perfect optimizers. They postulate that firms often do not optimize resource allocation because they are caught in a "business as usual" mentality.^{[citation needed]}