Monday, November 14, 2016
Wednesday, February 17, 2016
Peak Supermajors Introduction & 4Q2015 Result
This blog post was originally published at willmartin.com- go to willmartin.com to stay up to date on future blog posts.
http://willmartin.com/peak-supermajors-introduction-4q2015-results/
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http://willmartin.com/peak-supermajors-introduction-4q2015-results/
Introduction
Today I would like to introduce my “Peak Supermajors” project. The goal of this project is to answer the question “when will we reach peak oil” by studying the production and financial health of the world’s largest oil companies. Because oil is a finite resource, its daily global production will eventually reach a peak. By measuring when individual oil companies reach peak oil, I hope to bring us closer to answering the question “when will we reach peak oil?”
I am beginning my project by analyzing the largest publicly-traded companies: the “supermajors“. These 5 companies – BP, Chevron, ExxonMobil, Royal Dutch Shell and Total – produce nearly 20% of the world’s oil and gas. They are mostly descendants from the original “Seven Sisters,” which themselves were largely descendants of John D. Rockefeller’s Standard Oil Company. These companies are leaders in the industry, both financially and technologically. By understanding the history of these companies and their strategy for the future, we can better understand the historical arc of the broader oil industry. As I fill out the database I plan to expand it to include data from all of the largest global oil companies.
Seeing Oil on a Longer Time Horizon
One of my goals with this project is to expand the peak oil conversation to a longer time horizon. I am a member of the Long Now Foundation, an organization whose goal is to “provide a counterpoint to today’s accelerating culture and help make long-term thinking more common.” When I read news stories about the oil industry, the time horizon discussed always seems to be a financial quarter or (at most) a year. News stories talk about production changes “year on year” but never “decade on decade” or “since the company reached peak oil in 1972.” By collecting a database of multi-decade production data I hope to expand the quarterly production discussion to a longer time horizon.
One of my goals with this project is to expand the peak oil conversation to a longer time horizon. I am a member of the Long Now Foundation, an organization whose goal is to “provide a counterpoint to today’s accelerating culture and help make long-term thinking more common.” When I read news stories about the oil industry, the time horizon discussed always seems to be a financial quarter or (at most) a year. News stories talk about production changes “year on year” but never “decade on decade” or “since the company reached peak oil in 1972.” By collecting a database of multi-decade production data I hope to expand the quarterly production discussion to a longer time horizon.
Focus on Oil and Gas Production Individually
When quarterly earnings are reported, financial news sites usually mention the change in the company’s “headline” production figure (if they mention production at all). This “headline” figure combines oil production with gas production by converting gas to “barrels of oil equivalent” based on its embedded energy content. This is worse than combining apples with oranges.Chris Martenson describes it “as if someone asked you how many calories you had stored in your pantry, and you lumped together not just your food, but also the batteries in your flashlights and other home electronics. They might have caloric energy equivalents, but you sure can’t eat them.”
Oil and gas are not used in the same way. Oil is used to produce liquid transportation fuels (gasoline, diesel, jet fuel and marine “bunker fuel”) and to make lubricants. Natural gas is burned in power plants to make electricity and is converted by chemical plants into fertilizer and plastics. Due to the differences in outputs, oil and gas operate in very different competitive environments. Oil competes with biofuels (ethanol, biodiesel) and the electrification of transportation (electric cars, high speed rail). Gas competes with renewable electricity sources (wind, solar, hydropower, etc), organic fertilizers and bioplastics.
So instead of lumping oil and gas production together, I will be discussing them separately each quarter. Hopefully this will help steer the quarterly conversation away from “headline” numbers and towards an analysis of oil and gas production individually.
Seeing Peak Oil From Miltiple Angles
This database fits into a multi-faceted way of measuring peak oil. There are many ways to slice-and-dice global oil production including measuring production by country, by field, and (now) by company. Each of these measurements allows us to better measure whether we are approaching peak oil, are at peak oil or have passed peak oil. For example, using a country-level production database like the BP Statistical Review of World Energy allows us to determine which countries have passed peak oil. Steve Andrews publishes an analysis annually using the BP data to summarize all of the “Pre- and Post-Peak Nations.” Once enough countries have reached peak oil, we will pass the global peak in oil production. Using field-level data from IHS (Wood Mackenzie offers a similar field-level database) the Energy Watch Group in Germany has produced a series of reports showing current and future peaks by oil producing region. Once enough fields have reached peak oil, we will pass the global peak in oil production. The third way of looking at peak oil is at a company level. Every single barrel of oil is produced by a company, whether it be a publicly-traded company like ExxonMobil or a privately-held national organization like Saudi Aramco. Once enough oil companies have reached peak oil, we will pass the global peak in oil production. Looking at company-level data is just another window into peak oil.
This database fits into a multi-faceted way of measuring peak oil. There are many ways to slice-and-dice global oil production including measuring production by country, by field, and (now) by company. Each of these measurements allows us to better measure whether we are approaching peak oil, are at peak oil or have passed peak oil. For example, using a country-level production database like the BP Statistical Review of World Energy allows us to determine which countries have passed peak oil. Steve Andrews publishes an analysis annually using the BP data to summarize all of the “Pre- and Post-Peak Nations.” Once enough countries have reached peak oil, we will pass the global peak in oil production. Using field-level data from IHS (Wood Mackenzie offers a similar field-level database) the Energy Watch Group in Germany has produced a series of reports showing current and future peaks by oil producing region. Once enough fields have reached peak oil, we will pass the global peak in oil production. The third way of looking at peak oil is at a company level. Every single barrel of oil is produced by a company, whether it be a publicly-traded company like ExxonMobil or a privately-held national organization like Saudi Aramco. Once enough oil companies have reached peak oil, we will pass the global peak in oil production. Looking at company-level data is just another window into peak oil.
Data Sources and Future Work
My ultimate goal is to have a “full history” of production data for all of the supermajors. Because these companies can trace their origins to the very beginning of the oil industry, this means collecting over 100 years of data. To achieve this monumental task I began by collecting the most recent data from the company annual reports and SEC filings currently available online. I quickly learned that this data only goes back about 15 years and started searching for additional data sources. I found additional annual reports on company websites, online databases, archive.org, eBay, Amazon, Google Books, Google Scholar and the National Iranian Oil Company’s online library. I have also spent dozens of hours at Stanford’s Media & Microtext Center scanning microfiche copies of old annual reports. To fill in some of the gaps and double-check my work I relied on Richard Heede’s extensive database at carbonmajors.com as well asOil and Gas Journal company surveys.
My ultimate goal is to have a “full history” of production data for all of the supermajors. Because these companies can trace their origins to the very beginning of the oil industry, this means collecting over 100 years of data. To achieve this monumental task I began by collecting the most recent data from the company annual reports and SEC filings currently available online. I quickly learned that this data only goes back about 15 years and started searching for additional data sources. I found additional annual reports on company websites, online databases, archive.org, eBay, Amazon, Google Books, Google Scholar and the National Iranian Oil Company’s online library. I have also spent dozens of hours at Stanford’s Media & Microtext Center scanning microfiche copies of old annual reports. To fill in some of the gaps and double-check my work I relied on Richard Heede’s extensive database at carbonmajors.com as well asOil and Gas Journal company surveys.
I now have a private collection of over 1,000 annual and quarterly reports for some of the world’s largest oil companies. I will continue to expand the database and improve its accuracy over time. The database now stands at tens of thousands of data points, with hundreds of thousands of metadata points backing up each datum. Along with collecting 100+ years of production data I’ve also been collecting 100+ years financial and operational data for each company. I am planning to use this data to perform long-term analysis. For example, how has capital efficiency changed over time? Have the supermajors reached “peak production per dollar of inflation-adjusted CAPEX spend?” How has employee productivity changed over the last 100 years? Have the supermajors reached “peak free cash flow per barrel of production?” Have they reached “peak production per employee?” These are just a few questions that I plan on analyzing. As I complete the analysis I am planning to submit my findings to the Oil Age journal (arguably the best source for peak oil research) for academic publication. In the interim I’m planning to publish these short updates on a quarterly basis to show the current amalgamated state of the supermajors’ oil and gas production rates.
The data accuracy is not perfect right now. I’m about 80% confident with the accuracy of the data – which I consider “good enough to blog” but not necessarily good enough to submit to an academic journal. I still have some data validation to do and I plan to complete a full statistical audit with a large enough sample size to get me to 95% confidence in the data accuracy. So for the time being take all of this with a grain of salt.
Before I begin, I would like to knowledge the amazing work of people who inspired me to begin this project. I was inspired by similar company-focused efforts by Richard Heede, Matt Mushalikand the researchers at the Energy Watch Group. I would also like to thank Mason Inman for helping me think through the idea.
If you are interested in keeping up-to-date on this project, please SUBSCRIBE using the link to the left.
On to the show…
Supermajors
The supermajors’ liquids production rate for Q4-2015 was 9,329,500 barrels per day. Year-over-year, production rose by 611,022 barrels per day. Overall oil production peaked at 30,554,482 barrels per day in Q1-1973. Since reaching peak oil, Supermajor liquids production rate has fallen by 69.5%. This represents a post-peak compounded annual decline rate of 2.7%. If production continued to linearly decline at this rate, it would reach zero production in 2034. The more recent peak occurred at 11,135,767 barrels per day in Q3-1999. Since reaching the second peak, Supermajor liquids production rate has fallen by 16.2%. This represents a compounded annual decline rate of 1.1%. If production continued to linearly decline at this rate, it would reach zero production in 2099.
The supermajors’ liquids production rate for Q4-2015 was 9,329,500 barrels per day. Year-over-year, production rose by 611,022 barrels per day. Overall oil production peaked at 30,554,482 barrels per day in Q1-1973. Since reaching peak oil, Supermajor liquids production rate has fallen by 69.5%. This represents a post-peak compounded annual decline rate of 2.7%. If production continued to linearly decline at this rate, it would reach zero production in 2034. The more recent peak occurred at 11,135,767 barrels per day in Q3-1999. Since reaching the second peak, Supermajor liquids production rate has fallen by 16.2%. This represents a compounded annual decline rate of 1.1%. If production continued to linearly decline at this rate, it would reach zero production in 2099.
The supermajors’ natural gas production rate for Q4-2015 was 40,598,130,435 cubic feet per day. Year-over-year, production declined by 1,338,695,652 cubic feet per day. Overall oil production peaked at 47,339,390,527 cubic feet per day in Q1-2010. Since reaching this primary peak, Supermajor natural gas production rate has fallen by 14.2%. This represents a post-peak compounded annual decline rate of 2.6%. If production continued to linearly decline at this rate, it would reach zero production in 2050.
ExxonMobil
ExxonMobil’s liquids production rate for Q4-2015 was 2,481,000 barrels per day. Year-over-year, production rose by 299,000 barrels per day. Overall oil production peaked at 7,010,929 barrels per day in Q1-1972. Since reaching peak oil, Exxon Mobil Corporation’s liquids production rate has fallen by 64.6%. This represents a post-peak compounded annual decline rate of 2.3%. If production continued to linearly decline at this rate, it would reach zero production in 2039. The more recent peak occurred at 2,803,460 barrels per day in Q1-2007. Since reaching the second peak, ExxonMobil’s liquids production rate has fallen by 11.5%. This represents a compounded annual decline rate of 1.4%. If production continued to linearly decline at this rate, it would reach zero production in 2083.
ExxonMobil’s liquids production rate for Q4-2015 was 2,481,000 barrels per day. Year-over-year, production rose by 299,000 barrels per day. Overall oil production peaked at 7,010,929 barrels per day in Q1-1972. Since reaching peak oil, Exxon Mobil Corporation’s liquids production rate has fallen by 64.6%. This represents a post-peak compounded annual decline rate of 2.3%. If production continued to linearly decline at this rate, it would reach zero production in 2039. The more recent peak occurred at 2,803,460 barrels per day in Q1-2007. Since reaching the second peak, ExxonMobil’s liquids production rate has fallen by 11.5%. This represents a compounded annual decline rate of 1.4%. If production continued to linearly decline at this rate, it would reach zero production in 2083.
ExxonMobil’s natural gas production rate for Q4-2015 was 10,603,000,000 cubic feet per day. Year-over-year, production declined by 631,000,000 cubic feet per day. Overall gas production peaked at 14,652,000,000 cubic feet per day in Q4-2010. Since reaching this primary peak, Exxon Mobil Corporation’s natural gas production rate has fallen by 27.6%. This represents a post-peak compounded annual decline rate of 6.3%. If production continued to linearly decline at this rate, it would reach zero production in 2029.
Chevron
Chevron’s liquids production rate for Q4-2015 was 1,775,000 barrels per day. Year-over-year, production rose by 43,000 barrels per day. Overall oil production peaked at 10,718,904 barrels per day in Q1-1973. Since reaching peak oil, Chevron Corporation’s liquids production rate has fallen by 83.4%. This represents a post-peak compounded annual decline rate of 4.1%. If production continued to linearly decline at this rate, it would reach zero production in 2024. The more recent peak occurred at 2,273,819 barrels per day in Q4-1998. Since reaching the second peak, Chevron’s liquids production rate has fallen by 21.9%. This represents a compounded annual decline rate of 1.4%. If production continued to linearly decline at this rate, it would reach zero production in 2076.
Chevron’s liquids production rate for Q4-2015 was 1,775,000 barrels per day. Year-over-year, production rose by 43,000 barrels per day. Overall oil production peaked at 10,718,904 barrels per day in Q1-1973. Since reaching peak oil, Chevron Corporation’s liquids production rate has fallen by 83.4%. This represents a post-peak compounded annual decline rate of 4.1%. If production continued to linearly decline at this rate, it would reach zero production in 2024. The more recent peak occurred at 2,273,819 barrels per day in Q4-1998. Since reaching the second peak, Chevron’s liquids production rate has fallen by 21.9%. This represents a compounded annual decline rate of 1.4%. If production continued to linearly decline at this rate, it would reach zero production in 2076.
Chevron’s natural gas production rate for Q4-2015 was 5,385,000,000 cubic feet per day. Year-over-year, production rose by 285,000,000 cubic feet per day. Overall gas production peaked at 13,472,131,148 cubic feet per day in Q1-1972. Since reaching this primary peak, Chevron Corporation’s natural gas production rate has fallen by 60.0%. This represents a post-peak compounded annual decline rate of 2.1%. If production continued to linearly decline at this rate, it would reach zero production in 2045.
BP
BP’s liquids production rate for Q4-2015 was 2,137,000 barrels per day. Year-over-year, production rose by 169,000 barrels per day. Overall oil production peaked at 6,362,701 barrels per day in Q1-1973. Since reaching peak oil, BP plc liquids production rate has fallen by 66.4%. This represents a post-peak compounded annual decline rate of 2.5%. If production continued to linearly decline at this rate, it would reach zero production in 2037. The more recent peak occurred at 3,084,248 barrels per day in Q3-1988. Since reaching the second peak, BP’s liquids production rate has fallen by 30.7%. This represents a compounded annual decline rate of 1.3%. If production continued to linearly decline at this rate, it would reach zero production in 2077.
BP
BP’s liquids production rate for Q4-2015 was 2,137,000 barrels per day. Year-over-year, production rose by 169,000 barrels per day. Overall oil production peaked at 6,362,701 barrels per day in Q1-1973. Since reaching peak oil, BP plc liquids production rate has fallen by 66.4%. This represents a post-peak compounded annual decline rate of 2.5%. If production continued to linearly decline at this rate, it would reach zero production in 2037. The more recent peak occurred at 3,084,248 barrels per day in Q3-1988. Since reaching the second peak, BP’s liquids production rate has fallen by 30.7%. This represents a compounded annual decline rate of 1.3%. If production continued to linearly decline at this rate, it would reach zero production in 2077.
BP’s natural gas production rate for Q4-2015 was 7,076,000,000 cubic feet per day. Year-over-year, production declined by 148,000,000 cubic feet per day. Overall gas production peaked at 10,128,700,000 cubic feet per day in Q1-2000. Since reaching this primary peak, BP plc’s natural gas production rate has fallen by 30.1%. This represents a post-peak compounded annual decline rate of 2.2%. If production continued to linearly decline at this rate, it would reach zero production in 2052.
Total
Total’s liquids production rate for Q4-2015 was 1,077,000 barrels per day. Year-over-year, production rose by 0 barrels per day. Overall oil production peaked at 1,560,000 barrels per day in Q1-2006. Since reaching peak oil, Total SA liquids production rate has fallen by 31.0%. This represents a post-peak compounded annual decline rate of 3.7%. If production continued to linearly decline at this rate, it would reach zero production in 2037. The more recent peak occurred at 1,560,000 barrels per day in Q1-2006. Since reaching the second peak, Total’s liquids production rate has fallen by 31.0%. This represents a compounded annual decline rate of 3.7%. If production continued to linearly decline at this rate, it would reach zero production in 2037.
Total
Total’s liquids production rate for Q4-2015 was 1,077,000 barrels per day. Year-over-year, production rose by 0 barrels per day. Overall oil production peaked at 1,560,000 barrels per day in Q1-2006. Since reaching peak oil, Total SA liquids production rate has fallen by 31.0%. This represents a post-peak compounded annual decline rate of 3.7%. If production continued to linearly decline at this rate, it would reach zero production in 2037. The more recent peak occurred at 1,560,000 barrels per day in Q1-2006. Since reaching the second peak, Total’s liquids production rate has fallen by 31.0%. This represents a compounded annual decline rate of 3.7%. If production continued to linearly decline at this rate, it would reach zero production in 2037.
Total’s natural gas production rate for Q4-2015 was 6,219,000,000 cubic feet per day. Year-over-year, production rose by 0 cubic feet per day. Overall gas production peaked at 6,312,000,000 cubic feet per day in Q1-2015. Since reaching this primary peak, Total SA’s natural gas production rate has fallen by 1.5%. This represents a post-peak compounded annual decline rate of 2.0%. If production continued to linearly decline at this rate, it would reach zero production in 2066.
Shell
Shell’s liquids production rate for Q4-2015 was 1,859,500 barrels per day. Year-over-year, production rose by 100,022 barrels per day. Overall oil production peaked at 5,887,671 barrels per day in Q1-1973. Since reaching peak oil, Royal Dutch Shell plc liquids production rate has fallen by 68.4%. This represents a post-peak compounded annual decline rate of 2.7%. If production continued to linearly decline at this rate, it would reach zero production in 2035. The more recent peak occurred at 2,584,870 barrels per day in Q3-2002. Since reaching the second peak, Shell’s liquids production rate has fallen by 28.1%. This represents a compounded annual decline rate of 2.5%. If production continued to linearly decline at this rate, it would reach zero production in 2049.
Shell
Shell’s liquids production rate for Q4-2015 was 1,859,500 barrels per day. Year-over-year, production rose by 100,022 barrels per day. Overall oil production peaked at 5,887,671 barrels per day in Q1-1973. Since reaching peak oil, Royal Dutch Shell plc liquids production rate has fallen by 68.4%. This represents a post-peak compounded annual decline rate of 2.7%. If production continued to linearly decline at this rate, it would reach zero production in 2035. The more recent peak occurred at 2,584,870 barrels per day in Q3-2002. Since reaching the second peak, Shell’s liquids production rate has fallen by 28.1%. This represents a compounded annual decline rate of 2.5%. If production continued to linearly decline at this rate, it would reach zero production in 2049.
Shell’s natural gas production rate for Q4-2015 was 11,315,130,435 cubic feet per day. Year-over-year, production declined by 844,695,652 cubic feet per day. Overall gas production peaked at 13,940,791,209 cubic feet per day in Q1-2013. Since reaching this primary peak, Royal Dutch Shell plc’s natural gas production rate has fallen by 18.8%. This represents a post-peak compounded annual decline rate of 7.3%. If production continued to linearly decline at this rate, it would reach zero production in 2027.
Do Aerator Shower Heads Use More Energy?
This blog post was originally published at willmartin.com - go to willmartin.com to stay up to date on future blog posts.
http://willmartin.com/do-aerator-shower-heads-use-more-energy/
http://willmartin.com/do-aerator-shower-heads-use-more-energy/
Our house had an old “high flow” shower head. As California is in the midst of an epic drought (despite all the recent rain), I was planning on installing a low flow “aerator” shower head. These shower heads mix in air with the outgoing water to lower the flow rate while theoretically not sacrificing comfort. Compared to a traditional shower head the water pressure felt is higher but the flow rate is lower, so they end up saving water.
But right as I was about to install one I heard a theory that these aerator shower heads actually end up using more energy because the mist causes the shower to feel colder, which means the user turns the hot water dial up, thereby using more hot water, which requires the hot water heater to burn more natural gas (or use more electricity, which burns more coal and natural gas) to reheat more water.
At first I thought this was a calculus problem, (think high school calculus – water goes in to a tank at one rate and leaves at another rate, how long until the tank is empty?) but then I realized it’s actually a simple algebra problem. Since the user turns up the amount of hot water in the mix, we can just assume a temperature change differential and calculate the change in hot water usage.
I calculated the existing flow rate of the shower using a stopwatch and a bucket at 3.5 gallons per minute (it took 45 seconds to fill a 10 liter bucket). Other older high flow shower heads can be up to 5.5 GPM. According to the EPA, the average shower length is 8 minutes. This means my existing shower head uses 28 gallons per shower.
According to Bosch, the average shower temperature is 106 degrees Fahrenheit and the average groundwater temperature is 58°F. The Department of Energy recommends setting your hot water heater at 120°F. Our hot water heater was set to a scalding 140 degrees Fahrenheit, so I turned it down to 120. This means for each gallon of hot water you pull out of the hot water heater it needs to heat another gallon of water by 62°F (Delta T).
It takes 1 British Thermal Unit to heat 1 pound of water 1°F. At 58°F, 1 gallon of water weighs8.34 pounds. At 120°F, 1 gallon of water weighs 8.25 pounds. Using the average of the two, and assuming a 90% thermal efficiency in converting natural gas to hot water, a hot water heater uses about 570 BTUs for each gallon of hot water consumed.
By the time the 120°F hot water makes it from the hot water heater through the copper pipes to your shower it has lost about 5°F of heat. If you prefer your shower at 106°F then you will need to set your shower dial at a mix of 84% hot water (.84*115+(1-.84)*58=106). This checks out with the shower dial position of the old shower head being about 85% of the way towards full hot water. So the “high flow” shower head used about 13,406 BTUs per shower. (570 BTUs per gallon of hot water * 3.5 gallons per minute * 84% hot water mix * 8 minute shower = 13,406.4 BTUs).
After installing the new low-flow shower head, I noticed that I needed to move the shower dial slightly closer to the “full hot” position to achieve the same comfort level. I’d estimate it is about 95% of the way to hot. This means that the shower head lowers the temperature of the shower by about 6°F (106-(.95*115+(1-.95)*58)). The new low-flow shower head uses 2 gallons per minute. So at this new hot-cold mix, it uses about 8,664 BTUs per shower. (570 BTUs per gallon of hot water * 2.0 gallons per minute * 95% hot water mix * 8 minute shower = 8,664 BTUs).
So to answer the question of this blog: YES, aerator shower heads do save energy (and lots of water).
But how long does it take to pay for itself? According to the EIA, natural gas contains about 1,028 BTUs per cubic foot. At a cost of $10 per thousand cubic feet of natural gas (about the residential average in California for the past few years), each shower saves about 6.3 cents of energy. ((570 BTUs per gallon of hot water * 1.5 gallons per minute difference between the high flow and low flow shower heads * .95 percent hot water mix * 8 minutes) / 1028 BTUs per cubic foot of natural gas) * $0.01 per cubic foot of natural gas). If we reach “peak gas” in the near future, this cost could increase dramatically. Since the shower head cost $14, it will pay for itself after about 222 showers. Some water districts (including our own EBMUD) give away these shower heads for free, making the return on investment infinite!
Bonus:
While I was installing the new shower head I also installed a “ladybug” water saving temperature-controlled shutoff valve. This ingenious device shuts off the flow of water once it reaches a certain temperature. To restart the flow you simply pull a cord. So when you want to take a shower, you simply run it as you normally would; once the ladybug detects the shower is hot, it slows the flow to a trickle; then you just hop in and pull the cord to restart the flow.
The Ladybug Temperature-Controlled Shutoff Valve
The alternative way to avoid wasting water while you wait for the shower to heat up is to install a recirculating pump. This pump sits under your bathroom sink and is connected to the hot and cold water lines. When you’re ready to take a shower you push a button and the pump sucks water from the hot water line and forces it down the cold water line until the hot water line reaches the desired temperature. Besides being expensive (they cost about $200 without installation), a recirculating pump also causes your cold water line to have some warm water in it, so when you go to the sink to get cold water after a shower, it will be warm for a bit (which bothers some people).
Waiting for a shower to heat up wastes water and energy because most people don’t want to sit around with their hand in the shower stream waiting for it to heat up. This means that they might let it run for a minute or two longer than they need to. At 2 gallons per minute, an extra 2 minutes of run time amounts to a savings of about 2.1 cents per shower ((570 BTUs per gallon of hot water * 2 gallons per minute * .95 percent hot water mix * 2 minutes) / 1028 BTUs per cubic foot of natural gas) * $0.01 per cubic foot of natural gas). At a cost of $29, this will pay for itself after about 1,377 showers. While this may seem like a while, for a family of four, this is a payback period of less than a year.
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