Many countries don't use imported oil for power generation, but depend on it for transport. That will change if the cost of converting coal directly into liquid fuels can compete with that of refining crude oil. Nanotechnology may be the long-awaited breakthrough. "It has improved the economics of the process by $5 to $10 a barrel," says Theo Lee, CEO of Hydrocarbon Technologies Incorporated, a subsidiary of Headwaters, a Draper, Utah-based alternative-energy company. "Direct coal liquefaction is now economically attractive in China at today's international crude-oil price [of about $28]; a $4 to $8 a barrel increase in the price would make it economically attractive in the U.S."
"The 1990s was all about E-everything, the next decade will be all about N-everything," says an official at the European Commission, which has set aside ?1.3 billion for research into nanotechnology, new materials and production processes.
IBM, Motorola, Hewlett-Packard, Lucent, Hitachi, Mitsubishi, NEC, Corning, Dow Chemical and 3M have either launched nanotech initiatives through their own venture-capital funds or as a result of their own R and D, according to a CMP Cientifica report. Oil companies are busy with R and D projects of their own, says Nathan Tinker, a cofounder of the U.S.'s NanoBusiness Alliance.
The oil industry, already applying nanotechnology to refining petrochemicals, is looking at how it will be used to produce alternative energy. For example, nanotechnology is starting to make solar-energy cells cheaper and more efficient. The next challenge is to figure out how to store the electricity produced for later use. Nanotechnology promises to help by getting batteries to charge faster and making cells more commerically viable. To this end, Samsung, Sony and NEC have separately announced that they will use nanotechnology to make more efficient fuel cells to power laptops and mobile phones. These could be 20% more efficient and have a 10 times better power-to-weight ratio than lithium-ion batteries. The first products may be on the market by Christmas.
Later, cost-efficient fuel cells, running on hydrogen or a hydrocarbon such as methane, could transform both energy production and distribution. Many countries already have natural gas-delivery networks, and cost-effective fuel cells produced with the help of nanotechnology might shift demand from electricity grids. Fuel cells might eventually power cars. If the economics work out, we might even see cars parked in garages providing energy to houses.
If the pundits are right, the impact of nanotechnology on the energy sector will be nothing less than, well, electric.