Disclaimer

Disclaimer. After nearly 40 years managing money for some of the largest life offices and investment managers in the world, I think I have something to offer. But I can't by law give you advice, and I do make mistakes. Remember: the unexpected sometimes happens. Oddly enough, the expected does too, but all too often it takes longer than you thought it would, or on the other hand happens more quickly than you expected. The Goddess of Markets punishes (eventually) greed, folly, laziness and arrogance. No matter how many years you've served Her. Take care. Be humble. And don't blame me.

BTW, clicking on most charts will produce the original-sized, i.e., bigger version.

Saturday, September 30, 2017

California considers ban on petrol and diesel cars



The internal combustion engine’s days may be numbered in California, where officials are mulling whether a ban on sales of polluting autos is needed to achieve long-term targets for cleaner air. 
Governor Jerry Brown has expressed an interest in barring the sale of vehicles powered by internal-combustion engines, Mary Nichols, chairman of the California Air Resources Board, said in an interview Friday at Bloomberg headquarters in New York. The earliest such a ban is at least a decade away, she said. 
Brown, one of the most outspoken elected officials in the U.S. about the need for policies to combat climate change, would be replicating similar moves by China, France and the U.K. 
Embracing such a policy would send shockwaves through the global car industry due to the heft of California’s auto market. More than 2 million new passenger vehicles were registered in the state last year, topping France, Italy or Spain. If a ban were implemented, automakers from General Motors Co. to Toyota Motor Corp. would be under new pressure to make electric vehicles the standard for personal transportation in the most populous U.S. state, casting fresh doubts on the future of gasoline- and diesel-powered autos elsewhere.

[read more here]

SpaceX, Mars, and genius

BFR launching huge satellite



Last year Elon Musk came up with a plan to get to Mars.  The key is to make it cheap enough that it would be commercially viable.  When Congress asked NASA how much it would cost to send 5 men to Mars, they estimated $50 billion.  $10 billion per person!!!  Congress said that was too expensive.  Musk agreed.  He said he wants to do it at a cost of $500,000 per person or if possible, much less--a 20,000 fold reduction.

But to cut costs this much, you have to:


  • Have reusable rockets.  Up till SpaceX did it, no one had been able to get rockets to land back safely on earth, an obvious prerequisite to reusing them.  This alone will be enough to cut the cost 100 - 1000 fold.
  • Refuel the spaceship in orbit.  This will cut costs 5-10 times.
  • Manufacture fuel on Mars so it doesn't have to be carried there.  This will be done via the Sabatier process.  Mars has lots of frozen water and an atmosphere of CO2.  This will cut the cost by another 5-10 times.
Musk's original plans are beautifully explained  here.

BFR at Space Station


So with the largest cut in costs, if all the fixes work as well as Elon Musk/SpaceX estimate, then it will cost $100,000 to get to Mars.  As time goes by the cost will prolly keep on declining.  If that sounds horribly expensive, remember that it cost £30/US$150 to cross the Atlantic one way by steamer in 1900The average weekly wage in 1905 in the US was $10.05, so a one way ticket across the Atlantic cost about 1/3rd of year's wages. In 2014 the average wage in the US was $73,298.  So a one way ticket to Mars will cost 16 months' wages.  But Musk has said there will be a free ticket home for anyone who wants it.  So 8 months' wages one way versus 6 months' wages one way via steamer (in considerable luxury, naturally).

BFR at Luna Base


Of course, he may not cut cost by as much as he wants to.  But I wouldn't bet against Musk.  Everything he said he would do he's done (except it usually took longer!)

Getting to Mars and back


Yesterday, Elon Musk updated us with SpaceX's new plans.   The basic plan is the same, but he has a year's more achievements and planning under his belt.  First there have been 16 successful back to back landings of the first stage of Falcon 9.  Second, Musk has worked out how to fund the Mars venture.  He's going to concentrate on the new (slightly smaller) Mars Explorer, which will replace his existing Falcon 9, Falcon Heavy and Dragon.  So the one rocket and booster, 100% reusable, will be used to launch satellites, service the International Space Station, set up a colony on the moon, and go to Mars.  Construction of the Mars Explorer will start in Q2 next year.  The first cargo ships will leave in 2022.  The first manned ships will leave in late 2024.  And what was a throwaway thought last year, that this rocket could be used to fly people around the world is now part of their business plan: rocket ships between major cities in the world cutting flying time to under an hour everywhere and under 30 minutes to most places.  And all without government funding!

First City on Mars


This is all more or less existing technology, now, thanks to the key innovation by SpaceX, reusable boosters and ships.  It's going to happen.  I hope I live to see it.

(I've done an update, here)

This is the video of Musk's speech to the International Aeronautical Congress in Adelaide.  It's long, but it's quite enthralling.


Friday, September 29, 2017

The world's response to Trump on climate

Source

We have a fighting chance

Emissions have probably peaked, or will soon, but that still means that the level of CO2 in the atmosphere continues to rise, because we are still adding to it faster than natural processes can remove it. To stop the level in parts per million of CO2 in the atmosphere from rising, we have to reduce emissions by at least 80%.  Maybe more, because the natural "sinks" which absorb CO2 are full--the world's seas, for example are already turning more acidic.

Source


The good news is that emissions are about to start falling.

Renewables are getting progressively cheaper, and are steadily replacing coal.  The total costs of new renewables (without "firming") are now at or below the total cost of new coal and gas. Over the next 10 or so years, BNEF reckons that the total cost of new renewables will fall below the operating cost (mostly fuel and maintenance) of existing coal and gas power plants.  At that point, coal and gas power station shut-downs will be limited only by the cost of "firming", i.e, the costs of making variable wind and solar as "firm" as supply from baseload power stations which burn coal, gas or uranium.  And the costs of batteries, concentrated solar power (CSP) are falling fast, and there is always the 100 year old technology of pumped hydro storageSome estimates show that the cost of pumped hydro is as low $20/MWh.  CSP is coming at at $60-$70/MWh for power plus storage: "firm" (i.e. baseload) plus dispatchable capacity.  And you don't need 100% backup for variable renewables.  In most places 25% will do, so you will be able to combine cheap wind and solar with some storage and get baseload output more cheaply than from coal and gas.  At that point, existing coal and gas power stations will be rapidly and completely replaced with renewables.


(Source)


For the first time, mid-priced electric cars are available, and China (responsible for 1/3rd of global CO2 emissions) has tough new standards to reduce the sale of petrol/diesel vehicles (ICEVs). France, UK, Holland, Austria and now California are contemplating or planning a ban on petrol/diesel car sales from 2030 onward.  By 2022 or so, EVs will have the same "sticker price" as ICEVs, but they are far cheaper to drive.  By 2030, or before, 100% of car and light van sales will be electric.


Source


There remain some hurdles--agriculture, burning forests/scrubland, cement and iron and steel production, jet travel. But even together, these are smaller than transport and electricity generation combined. If we can convert electricity production to renewables/nuclear and can electrify our car/truck fleet, we have a fighting chance.

But there is a race between de-carbonising our economy and the rise in world temperatures.  As long as atmospheric CO2 keeps on rising, so will average world temperatures.  And CO2 will only stop rising when CO2 emissions have fallen at least 80%.

Global temperatures are rising by 0.2 degrees C per decade. The rise may be accelerating--let's hope that it's not.

Source NOAA



Let's say it takes us 20 years to move to 100% renewable electricity. Hydro+renewables are now 22% of world electricity supply, which means we need to target a 4% per annum switch, but it will likely be slower in earlier years and much faster towards the end.  That means that global temperatures will rise by another 0.4 degrees.

Cars will take longer. As I said, we'll prolly get to 100% electric sales by 2030, maybe earlier, but cars last a long time (I've seen data varying between 11 and 20 years, depending on the country) If it's 20 years, we won't have a 100% car fleet till 2050. That means temps will rise another 0.2 degrees. So by 2050 we will end up 0.6 degrees above 2016, 1.8 degrees (?) above the pre-industrial average. Plus there are built in lags in the system's response to forcing which will cause temperatures to go on rising for a few decades even with zero emissions.

Hence the "fighting chance" in my title: we have started the switch to a carbon-free economy, but we have left it so late we may not avoid catastrophe.  We have a "fighting chance".

But I suspect the screws will tighten every year. Despite Donald Trump, Tony Abbott and other gibbering imbeciles on the right. What will it take to make the Republicans sensible about global warming? How many more hurricanes, heatwaves, floods? Miami constantly under water from "nuisance" or "sunny day" flooding?

The world is going to commit itself ever more urgently and with ever greater force to reducing CO2 emissions as the evidence of global warming becomes ever more obvious and the cost of de-carbonising continues to fall.  And that improves the odds of our "fighting chance".

Thursday, September 28, 2017

The Right is wrong

In a radio program, Tony Abbott, a former PM of Australia, a prominent member of the right wing of the "Liberal" Party that is in power at present in Australia said:

"Green religion" trumped common sense for the last 15 years.

(Source: The Guardian)

Over the last 15 years, industrial scale solar has fallen 95% in cost. 15 years ago, wind and solar were many times more expensive than fossil fuels. Since 2009, when Abbott started his self-serving anti-renewables crusade, wind has fallen 66% in cost and solar 85% (Lazard).

Source: NOAA


At the same time, the world was 0.34 degrees cooler in 2002 than it is now, using NOAA data. So it was reasonable for people to be cautious about a switch to renewables 15 years ago, or even 7 years ago. But this hardened into dogma on the Right. And dogma is rarely susceptible to facts.

Over the next 15 years, global temperatures kept on rising. And rising. And the costs of renewables kept on falling. And falling. Renewables are now cheaper than new coal here in Australia, and in most places around the world. In another decade or so, the total cost of new wind and solar will be less than the fuel cost of fossil fuel generators everywhere. At that point even fully depreciated (=cheap) coal power stations will be shuttered. Incidentally, that tipping point is closer in Australia with its aging coal generation fleet than it is in many other countries.

It used to be--30 or 40 or 50 years ago--that conservatives were the practical side of politics, pragmatic, facts-based, opposed to subsidies, realistic. It was the Left who were the dreamers, who believed in and reached for a better world. But the Right (here in Oz and in the USA) now has a bizarre religion: coal. Even though coal is more expensive than renewables, even though everyone can see that coal is doomed, they love coal so much they actually favour subsidies for coal mines and coal power stations!

Technology and economics are on the side of the Left. Wind and solar (and increasingly batteries) are cheap and clean. They need no fuel. They won't cause the world to heat up even more. They don't kill people with air pollution, because they don't cause any. The desire for a better world aligns with the new cheap technologies, not with the nostalgic nonsense of the Right.

It's wonderful that facts are on the side of the dreamers, now. And surely very perilous for the Right. For ordinary citizens also want a better world for themselves and their children. And they know that renewables are not just necessary but also superior to the technologies of the past: cleaner, healthier, cheaper, better.  As global temperatures rise, and the consequences of global warming--droughts, floods, hurricanes, sea level rise, killing heat waves--become more and more serious, public opinion will sharply shift.  Those who have spent decades lying about global warming will become outsiders, and right-wing parties will carry an enduring stigma.  Prudent politicians on the Right would be wise to start disowning the denialist fictions and severing their ties with denialist "thinktanks" or they will pay the electoral price.

What the move to EVs means for Lithium

The lithium price and Tesla's share price (Source: Bloomberg)


In this video, via Bloomberg, analysts discuss the impact of EVs on Lithium and Cobalt.

Key points:

  • For now there is more than enough lithium and cobalt for batteries
  • But by the mid-2020s, there might be a squeeze--lithium production would have to increase by 300%, cobalt production by 127%.  It can take from 2 to 15 years for new mines to start producing.  However there's a LOT of lithium in Chile.
  • Car makers face significant capex to catch up with the new technology, plus we are at the end of an 8 year global upswing in car sales and production.  They'll prolly underperform -- except for Tesla.
  • Even if price of lithium quadrupled, that would only increase battery prices by 2%
  • If cobalt doubled or tripled in price, that would still cause only a less than 10% increase in price
  • The prices of other components are plummeting, so the net impact will likely be zero.



We can't afford it!

By Joel Pett



South Korea to close coal power stations

Seoul’s Namsan Tower is blanketed in thick smoke (Source: Korea Herald)



They're not doing it because of global warming:

South Korea’s environmental authorities on Tuesday unveiled a package of measures to tackle the worsening air pollution, including shutting down aged coal power plants and reducing pollutants from diesel vehicles and factories. 
The measures are aimed at helping reduce fine dust emissions by more than 30 percent by the end of President Moon Jae-in’s term in 2022, authorities said. 
Last year alone, the country’s dust levels were above 50 micrograms per cubic meter for 248 days. With the new package of measures, the government hopes to reduce the hazardous days to 78 days by 2022.  
The World Health Organization classified the fine particulates as first-degree carcinogens, which can penetrate into the respiratory system and trigger fatal illnesses like cancer. 
In the face of hazardous smog, cities and provinces have installed indoor sports facilities at schools and provided care centers for the elderly.

[read more here]

You have to ignore a lot of bad news to be optimistic about coal.  It's filthy to mine, filthy to burn, kills people, causes global warming, and is more expensive than most alternatives. And demand has been falling for three years.  The decline will continue.

Tuesday, September 26, 2017

BYD gives date for ICEV ban.

BYD compact car



(BYD is a Chinese electric car, bus, and monorail maker; ICEV stands Internal Combustion Engine Vehicle, EV stands for Electric Vehicle, NEV stands for New Energy Vehicle.  Phew!)

I posted here that China was going to ban the sales and production of ICEVs at some point, but the government hadn't yet said what that date was.  BYD's chairman, Wang Chuanfu, has now said that this will be in 2030 and that 100% of sales must be NEVs by then. He should have a very good idea of the date -- BYD is the world's largest electric car manufacturer.  Since NEVs includes plug-in hybrids as well as EVs and hydrogen-cell vehicles, there will still be some emissions from burning petrol and diesel.  But much less than there are now, because 90% car trips are short, and the plug in hybrid will use its electric motor and its battery, with the petrol/diesel engine only being used for long trips.

2030 is just 12 years away.  The average car maker takes 5 years from model conception through production to the cars appearing in showrooms.  Europe is setting 2040 as the date when ICEVs will stop being sold.  But as China aggressively switches to EVs it will gain a huge competitive advantage on world markets.  China produces and buys 1/3rd of the world's cars.  How many venerable names in Europe and the USA will vanish as the car market transforms?  How many will end up as 100% subsidiaries of Chinese car firms, as Volvo now is?  How will the European auto powerhouse, Germany, manage this transition?  Does anybody still seriously think the future lies in petrol cars?

Time for hard questions in chancelleries and auto and oil board rooms round the world.


Coastal flooding and climate change

From JPratt27




tttt

Monday, September 25, 2017

The jury is in on climate change

Cartoon by Jonathan Schmock


We don't care if poor people die

By cartoonist Drew Sheneman



The Earth's climate regulates itself

Weathering removes carbon dioxide from the atmosphere and delivers it to the ocean, where it combines with calcium to form limestone. Limestone is drawn under the Earth’s crust by the movement of tectonic plates — a process known as subduction. Heat separates carbon dioxide from limestone. Carbon dioxide is ejected into the atmosphere through volcanic eruptions. Source: William Ruddiman





Life on Earth has survived vast changes in climate, from a warm period 450 million years ago, when most of the present-day United States was underwater, to the last ice age 20,000 years ago, when New England was buried beneath a mile-thick glacier. Though climate change trigged mass extinctions, life went on. 
This is something of mystery. Runaway climate change turned Venus into a scorching hellscape, but Earth never grew so hot or cold that life failed to endure. Even in its most turbulent moments, our tiny planet remained a refuge, a blue-green lifeboat adrift against the vast hostility of space. Why? 
Scientists have long speculated on the possibility of a planetary thermostat keeping climate change in check.  
Here’s how it works: Carbon dioxide traps heat, keeping the Earth nice and cozy. A dip in CO2 can bring about an ice age. A spike can make the planet sizzle. Earth regulates this greenhouse gas through weathering. Atmospheric carbon dioxide dissolves in rainwater and combines with rocks to form bicarbonate. 
The global thermostat responds to hot and cold. Heat speeds up chemical reactions, causing rocks and rainwater to draw down carbon dioxide levels more rapidly, thereby cooling the planet faster. Cold temperatures slow down this process, preventing the planet from getting too chilly.
Weathering is the reason that Earth is not like Venus, where rising levels of carbon dioxide rendered the planet inhospitable to life. Today on Venus, where the atmosphere is almost entirely carbon dioxide, the average temperature is more than 800 degrees F. On Earth, the average temperature is closer to 60 degrees F.
.

[Read more here]

It sounds as if we could just go on spewing CO2 into the armosphere without worrying, doesn't it?  The problem is that the natural processes of weathering take thousands of years.  If we stopped emitting CO2 now, it would take 100,000 years before atmospheric CO2 went back to the pre-industrial level:

“It’s some degree of liquid water interacting with rock that keeps the Earth’s climate stable over long time periods,” said Pogge von Strandmann. As he noted, this is of little comfort when it comes to human-caused climate change. Weathering changes the climate gradually, over many thousands of years. 
“We know that weathering will increase [as the planet gets warmer],” he said. “We know that it will remove carbon dioxide, but it will be at least 100,000 years or so before it would allow the climate to recover back to pre-industrial conditions.” By burning coal, oil and natural gas, humans are transforming the climate on the scale of decades.
[read more here

Sunday, September 24, 2017

Energy security

One of the obvious--but not often acknowledged--factors in choosing renewables over fossil fuels is energy security.  For countries like India (7% of world CO2 emissions) and China (33%), renewables are attractive not just because they're cheaper and cleaner, but also because they're local.  Coal and (especially) come from other countries.  They have to be paid for with scarce foreign exchange.  Supply is vulnerable to embargoes and war.  The sun and the wind are local, and free.

Renewable energy is the only way for a country like India with the population as large as 1.25 billion that has finite fossil fuels to cater to the needs of all, said Anand Kumar, Secretary Ministry of New and Renewable Energy (MNRE). However, asserting the fact that India is determined to achieve the target of installing 175 gigawatt (GW) of renewable energy capacity by 2022, Kumar said that advancements in technology and dropping prices of solar and wind, the country can even surpass the target. “Under Prime Minister Modi, we up-scaled our total renewable energy target to 175 GW by 2022. With advancements in technology, and with price of solar and wind reducing, we are not only sure but confident that we will not only achieve the target, but exceed it,” he said. 
While speaking at the 11th edition of Renewable Energy India Expo in Greater Noida on Wednesday, Kumar also said that in recent consultations, the MNRE has begun to take more seriously the potential of India’s offshore wind and hydropower capacities, and hinted that these technologies will be brought under the renewable energy target. 
Meanwhile telling about India’s ‘silent revolution’ which will see the country rapidly scale up its electricity generation capacity and consumption, he underlined the key challenge of how to enable higher energy consumption in India, at a cost people are willing to pay, and not only willing to pay, but able to pay as well. He affirmed the path of least resistance is the one with the lowest carbon intensity. “India has limited fossil fuels. We depend on imports for petroleum. If we have to support and meet the demand of 1.25 billion people, then renewables are the only way.”

[Read more here; my emphasis]

Source



Saturday, September 23, 2017

My, how you've grown!

The reason wind power has got so cheap is that wind turbine sizes have exploded.  The output from a wind turbine is proportional to the area "swept" by the blades, which is the square of the radius (𝝿r²).  A doubling in the length of each blade causes a fourfold increase in output.  Other improvements have helped too: changes in gears and in blade shapes, and the learning curve improvements that come with mass production have also pushed down costs.

Source

From the Bloomberg article:
The same process of producing more electricity for a lower cost is making photovoltaics cheaper. Liebreich predicted two “tipping points” where the cost of renewables will make power generation fueled by natural gas and coal increasingly unattractive. 
“The first is when new wind and solar become cheaper than anything else,” Liebreich said. The slide below from his presentation indicates that in Japan by 2025 it will be cheaper to build a new PV plant than a coal-fired power generator. That milestone will be passed in India for wind power by 2030. 
“At that point, anything you have to retire is likely to be replaced by wind and solar,” Liebreich said. “That tipping point is either here or almost here everywhere in the world.”


Source

Source

The second tipping point, a little further off, is when it’s more costly to operate existing coal and gas plants than to take power from wind and solar. The chart below, from BNEF forecasts, indicates that point may arrive in the middle of the next decade in both Germany and China.

[Read more here]

Source



When wind and solar are cheaper than existing coal and gas, the switch away from fossil fuels will be very rapid.  China and Europe produce 40% plus of world carbon emissions.  So when they shift, especially given the push towards EVs, emissions will fall sharply. It's this sort of dynamic that makes me optimistic that the world will avoid the worst case global warming scenarios.  Alas, we won't save ourselves or the world because of our innate good nature but because we will save money by doing so.  All the same, I count that as a win.

80% of global car market to ban petrol cars

Say goodbye to gasoline. The world's slow drift toward electric cars is about to enter full flood. 
China, one-third of the world's car market, is working on a timetable to end sales of fossil-fuel-based vehicles, the country's vice minister of industry and information technology, Xin Guobin, told an industry forum in Tianjin on Saturday. That would probably see the country join Norway, France and the U.K. in switching to a wholly electric fleet within the lifetime of most current drivers. 
The announcement is important because the most influential players in the global auto market have always been not companies, but governments. Diesel cars make up about half of the market in the European Union and less than a percentage point in the U.S., largely because of different fuel-taxation and emissions regimes. Carburetors have been regulated out of most developed markets because fuel injection -- originally a more costly technology -- results in less tailpipe pollution.

Moves toward electrification of the world's cars have been tentative. Just 695,000 electric vehicles were sold in 2016, according to Bloomberg New Energy Finance, equivalent to about three days of sales in an 84 million-strong market. Including those already on the roads, the global car fleet is roughly a billion-strong. 
At the same time, the direction of travel is unambiguous. China's auto industry plan released in April envisages new energy vehicles -- including electric and hybrids -- making up all the future sales growth in the country. With conventional cars plateauing at current levels, new-energy vehicle sales will reach 7 million annually in 2025. As many as 800,000 charging stations will be built this year alone, according to the official China Daily. Government mandates will require manufacturers to sell 8 percent of their vehicles with electric or hybrid powertrains from next year, or purchase credits to make up the difference, rising to 20 percent by 2025.
India, due to overtake Germany and then Japan as the world's third-biggest auto market by 2020, is on a similar path. Prime Minister Narendra Modi's think-tank Niti Aayog aims to get electric vehicles to 44 percent of the fleet by 2030, and is aggressively favoring them with tax rates 31 percentage points below those on hybrids and internal-combustion-engine cars under its new harmonized GST sales tax.

[Read more here]

Source

Friday, September 22, 2017

Utility death spiral

Drawing by Matt Davidson.  (Source)




What's most terrifying the electricity industry isn't the threat of price control or a clean energy target or even being forced to keep open power stations that have long since ceased to work properly. 
It's not even the government's inability to come up with a clear set of rules.
It's a fear more primal – the same one gripping the national broadband network, public schools, and private health funds.  Analysts at AGL Energy call it "the death spiral".
 
US economist Craig Severance coined the term six years ago. 
"In this nightmare, a utility commits to build a very expensive new power plant," he wrote. "However, when electric rates are raised to pay for the new plant, the rate shock moves customers to cut their use. The utility then has no way to pay for the new power plant unless it raises rates even higher – causing a further spiral as customers cut their use even more or walk away. 
"In the final stages of that death spiral, the utility's more affluent customers have drastically cut purchases by implementing efficiency and on-site (solar) power, but the poorest customers have been unable to finance such measures. The utility is then left attempting to collect higher and higher rates from poorer and poorer customers."

[read more here]

Tony Seba talks about "god parity" where rooftop solar plus storage is cheaper than the cost of distribution of electricity.  In other words, where all generating technologies, even they cost zero, will still be more expensive than rooftop solar plus storage.  And the risk then is that consumers disconnect from the grid, or drastically minimise consumption, in just the sequence described above.  The inexorable decline in the costs of solar and the costs of storage bring god parity--and the consequent utility death spiral--closer every year.   If you thought governments and regulators don't know what to do now, just wait till the death spiral gathers momentum.

Because wind turbines are far more efficient the larger they are (the output is equal to the square of the radius and the cube of the wind speed), it doesn't make sense for small electricity consumers to have their own wind turbines unless they are already off grid, so a utility death spiral is unlikely in high latitudes.  But it is a real possibility for places between 35 or 40 degrees north and south of the equator.  A recent survey shows that Australians view solar with storage as a key way to cut electricity bills.  As we use less electricity, because prices keep on rising and the costs of solar and storage keep on falling, a utility death spiral in Australia seems more and more likely. 

We are no longer helpless in the face of utility greed and incompetence.  And that totally changes the relationship.  I suspect most utilities have yet to understand that.  But they had better get up to speed quickly, or it may be too late.

Syriasly? US now Alone in Snubbing Paris (with one Other Failed State)

This headline amused me.

It comes from Climate Denial Crock of the Week.

And then there were two. 
This week, Nicaragua, one of the few holdouts from the Paris climate accords, did an about-face and said it will sign the agreement. 
Nicaraguan President Daniel Ortega announced that the Central American nation of 6 million people ― about the size of Maryland ― would sign the landmark pact voluntarily committing nations to reduce greenhouse gas emissions, according to El Nuevo Diario, one of the nation’s major newspapers. 
After President Obama, who orchestrated the pact bringing together more than 190 nations, only two nations had yet to sign the agreement in April of this year. 
One was Syria, which was and still is in the middle of a bloody civil war. The other was Nicaragua, which attended 2015 talks but refused to sign the accord. 
President Trump announced his intent to make the United States the third nonparticipant in the pact because of, as he said in a speech in June“the draconian financial and economic burdens the agreement imposes on our country.”
[Read more here]

Source

Toss the world

Cartoon by Steve Bell, The Guardian



Tuesday, September 19, 2017

48% of electricity from rooftop solar

In the chart below, the blue area shows net demand from the South Australian grid on the 17th of September 2017 after output from rooftop solar.  The yellow shows output from rooftop solar.  The black line shows the wholesale price of electricity.  The downward spike between 5 a.m. and 6 a.m. is because there was trouble with SA's interconnector with Victoria.  In fact the wholesale price went negative (-$44/MWh) because there were strong winds and nowhere to ship the power.  (A perfect opportunity for batteries, you'd think.)  The peak in demand at 1 a.m. is because everybody's geysers (hot water cylinders) are timed to go on, a relic of the days when electricity was produced by coal power stations and all that excess supply from invariable baseload had to be soaked up when demand was low between midnight and 5 a.m.

This is a record for SA, and it happened in spring.  It's a couple of months from midsummer. Rooftop supply will be much larger in December, but so will demand because of aircon.   Ultimately, a big percentage of daylight demand for places between latitudes 35 or 40 north and south of the equator will be satisfied by rooftop solar.  And we will rely on wind, CSP and batteries to provide power at night.

[Read more here]


Source





Monday, September 18, 2017

Why India must dump coal


Smog in India (Source)


From the Hindustan Times:

Coal is at risk from competition from low cost renewables, volatile commodity prices, growing concerns about air pollution, worsening water availability for cooling, the increasing incidence of heat waves that reduce operating efficiencies and, of course, necessary action to tackle climate change. These factors in combination are driving the structural decline of coal, led by China. According to Wood MacKenzie, coal use in China has dropped by 40% in the last five years.
According to Morgan Stanley, solar power in India has recently reached a tipping point, becoming more affordable than coal. Other Asian economies already seem to understand the dynamic of coal being highly risky. For example, South Korea’s newly elected President Moon Jae-In’s is moving to phase out coal and shift into solar and wind. Taiwan is expanding its renewable energy plans whilst reducing its reliance on coal by a third, from 45% to 30% by 2025.
Analysts now argue that coal usage in India will peak in the next five to 10 years. India will join China, and other East Asian economies, in halting new coal growth. No new coal plants are set to be commissioned for the coming decade, according to the Central Electricity Authority’s draft plan. And 37GW of old coal could be shut down, while Coal India is set to close 37 mines
While Europe and India are at different stages of development, the European experience shows how investing in coal can go badly wrong. Between 2005 and 2008, European power companies planned to build 65 new coal-fired power plants, with 49 gigawatts (GW) of capacity, but only 12 were actually built. More cancellations are expected.  In Germany alone, 20 GW has been cancelled.
[Read more here]

Sunday, September 17, 2017

China plans to ban petrol/diesel vehicles

The Chinese car-maker BYD is the world's largest producer of EVs.  This is the BYD Qin EV300.
Picture source: Green Car Reports 


Though no date has been set, China has announced that it is working towards a total ban on the sales and production of fossil-fuelled vehicles.  I've mentioned China's tight targets here and here.   China is doing this because of its horrendous air pollution.  But it's also doing it because it wants to dominate the developing electric car industry.  It produces and buys a third of the world's car output.  No car maker will be able to ignore this policy.  China is too big a market,  especially since India has now said it will ban petrol car sales by 2030.  It is all too likely that China will use its domestic push towards EVs to drive down unit costs and increase its car sales globally.  Car makers have been dragging their feet about EVs.  But the disaster of the diesel scandal, the extraordinary success of Tesla, and now more and more bans of fossil-fuelled car sales within 15 years around the world must be provoking some serious rethinking in auto boardrooms.

[Read more here and here]

Smug pilots

From Will McPhail of the New Yorker


Why wind has got so cheap.

Some more snippets from the Windlab Prospectus.


The first modern wind turbine built, in Denmark in 1978, had a capacity factor of just 7%.




Just to show how big wind turbines are.  This is one blade of the rotor.  Pic looks as if it was taken in Queensland.  Note solar panels on the roof of the small business on the right.




Soft denialists note: the wholesale price of electricity is determined by the most expensive bidder/generation source, and that is NOT renewables.  It is gas.  Gas in Oz is much more expensive than in the USA.  Gas is vulnerable to falling costs of storage.  When the costs of dispatchable electricity (from batteries or molten salt storage from CSP) fall below the costs of gas peaking plants, they will be favoured over gas in the bidding "stack".


This might appear to be of interest to Australia only.  But the technological shifts are global.  The cost declines in wind are global.  The gradual undercutting of coal is a global phenomenon.  What is different in different parts of the world is the applicable rate of interest/discount rate/cost of finance and the cost of connections to the grid.



Friday, September 15, 2017

Are you fed up?

A perfect Cathy Wilcox cartoon. (I should explain--there is currently a "referendum"/survey taking place in Oz about whether gay marriage should be made legal, plus a huge debate about renewable energy, with the trogoldytes on both issues more or less the same people)


Baseload from wind and solar

Those who are still wedded to coal (with an occasional foray into nuclear) keep on insisting that we need baseload electricity, and that wind and solar are too "variable" to allow us to rely on them.

This chart, which references the new Kennedy wind plus solar plus storage project by Windlab in Queensland's far north, shows how closely you can produce near baseload output from a combination of these two different renewables.

Source: Windlab Prospectus

The pine green shows measured daily output averaged over one year from wind, the dark blue from solar, and the top of the green shows the combined averaged daily output from wind and solar.  The black line shows averaged daily demand in Queensland.  The times of day when supply from wind plus solar is "above" the black line (they are on different scales) more power is being produced than is needed, while when the top of the pine green line is "below", it's the reverse.  So storage is needed; the batteries charging up overnight and discharging from midday to about 10 p.m., with the maximum "gap" at about 6 p.m. when everybody gets home and turns on the aircon and the kettle, before wind speeds have picked up.

Well, say the baseload promoters, you don't need storage with baseload, because it's always there.  Have another look at the chart.  The red line on the chart represents hypothetical baseload output from, say, a coal-fired power station.   There would be too much electricity produced between 10 p.m. and six a.m., and too little between 1 p.m. and 10 p.m.  You would still need storage. Or you would need peaking gas plants from 1 p.m. to 10 p.m., and you would have to wastefully vent steam from your coal power station to prevent the grid overloading between 10 p.m. and 6 a.m., because you can't quickly dial down (or up) the heat output of a coal power station to meet variations in demand.  Both very expensive.  In fact batteries would be really useful to a grid with 100% baseload electricity generation too.  The only difference between a 100% baseload and a 100% renewable grid is that you you would need roughly twice as much storage capacity.

The three key objectives to consider are cost, reliability and carbon emissions.  A 100% renewable grid with a mixture of wind and solar produces no carbon, and will (with enough storage capacity) be completely reliable.   All good, but will it be cheaper?

That depends on the cost of storage and how much you need.  The new Tesla Powerpack utility-scale battery costs US$109/MWh (back of the envelope calcs, using the costings revealed by Elon Musk for the South Australia battery bank)  Reading off the chart, you'd need storage equal to half of demand for 3 hours and 20% of demand for 5 hours, or a total storage of 2 and a half hours of daily demand.  Let's say 3 hours, to be safe.  Wind and solar are half the cost of coal, even ignoring coal's CO2 emissions and lethal pollution.  Wind is A$55/MWh, solar (at that latitude) A$65/MWh. Assuming capacity factors of 40% for wind and 25% for solar, about 80% of the output will be wind, 20% solar, so roughly A$57 for the electricity output.  Cost of storage in A$ is $145/MWh (US$109 /0.75)  You'll need 3 hours total storage to cover 24 hours demand, so that's $145/24*3, or  A$18/MWh.  Total cost = A$57 + A$18, or $75/MWh⧫.  New coal is A$110/MWh before a carbon tax, and that ignores the storage needs of baseload ($9/MWh?) or the cost of gas peaking power plants, and venting steam at night (X$/MWh??)  So, A$75 vs A$120, or a 40% discount for renewables over coal, with zero carbon emissions and complete reliability.

A combination of wind plus solar with storage can provide baseload, more cheaply and much more cleanly than coal can.  There is no case for baseload coal.  Existing coal power stations will keep going until they wear out, but there will be no need for new ones to be built.





⧫ Incidentally, the same price that the new CSP plant in South Australia will be selling its output to the SA government.  But the CSP plant will provide 8 hours of storage.  CSP still a lot cheaper than batteries.






Thursday, September 14, 2017

The EV, circa 1895

From The Westminster Budget, London, November 22, 1895.

They even have a recharge station (at the back, left)

(Source: Yesterday's Print)


Small modular reactors

Source: Rolls-Royce


There's a push on in the UK for the government to embrace small modular reactors (SMRs).  These are much smaller than the giant at Hinkley Point in England (1/10th the size) .  They're being developed by Rolls-Royce, who have a long involvement with the nuclear-powered submarines of the Royal Navy.   Rolls-Royce, needless to say, is enthusiastic:

Traditional large nuclear plants are bespoke projects often relying upon state support, but small modular reactors could be made in centralised manufacturing facilities and then transported to anywhere in the country or overseas, producing benefits of scale which would drive down costs. Rolls-Royce is developing a patented modular concept which is designed specifically for factory manufacture and commissioning, speed of installation and reduced onsite construction work. This mitigates the programme risk associated with conventional nuclear plants. Our concept is the best of breed in terms of design, manufacture, cost and ownership.
Rolls-Royce believes its SMR design will:
• Provide 220MW to 440MW of power, depending on the configuration, that’s the equivalent of up to 150 onshore wind turbines.
• Supply power to the grid in a timely manner at lower cost to the taxpayer and consumer, generating electricity that is at least as cheap (per MW) as power generated by today’s large scale reactors – potentially even cheaper when SMRs go into volume production.
• Represent the lowest risk by using proven technology and best value by using a high degree of commercial or standardised off-the-shelf components.
• Open up opportunities for UK supply chain companies to enter into volume manufacturing as over 75% of the design (by cost) is modular.
• Appeal to a UK commercial or international utility company or power station operator.
• Be so compact (16 metres high and 4 metres in diameter) it can be transported by truck, train or even barge.
• Sit within a power station that would be roughly five and half times the size of the pitch at Wembley, which is just one-tenth the size of a typical large-scale reactor site
(40,000m2 vs 400,000m2).
• Take just 5 years from the start of construction to the generation of the first electricity.
• Be up and running by 2028, maximising the UK’s first-mover advantage in the race for exports.
• Minimise operating costs such as refuelling and the burden of decommissioning.
• Last for 60 years. 

[Read more here]

Rolls-Royce reckons that these new SMRs will produce electricity at £60/MWh (US$80/MWh), which is cheaper than  Hinkley Point, but will only be possible with economies of scale.  To be fair, that's similar to the situation with concentrated solar power (CSP) and batteries.  Unlike the giant bespoke nuclear plants being built at Hinkley Point, Flamanville and in Finland, the risk of huge cost overruns is less (or at least controllable).  We could build one SMR at a fraction of the cost, see if it works and how much it really costs, and then build others.

Rolls-Royce only expect this technology to be available in 2028.  By then, at the current growth rates for wind and solar, let alone CSP, renewables could be close to 2/3rds of total global electricity supply.  Will the world need new nuclear then?  The costs of renewables will have fallen further, but how much further will the costs of SMRs fall?  Plus, baseload is no longer very attractive (what is and will be needed is dispatchable electricity rather than baseload) and nuclear is very much baseload.  Can the activity of SMRs be dialled up or down, even on a 24 hour time frame?

I have said before that if I believed nuclear could be instrumental in our shift towards a carbon-free economy, I would grit my teeth and support it.  If  SMRs are not much more expensive than renewables, and if  they are safe, and if  they will still be useful in 10 years time when they come on stream, then they might be part of the solution.  But I hae me doots.



Wednesday, September 13, 2017

First commercial BYD Skyrail opens

Source


When BYD (the world's largest maker of electric cars and busses) announced its new monorail product SkyRail, I was very interested in it as a partial solution to Melbourne's transportation problems.  It seems odd that a city in a developed country should have major transportation problems, but in fact Melbourne shares some of the problems of rapidly growing cities in the third world. Melbourne's population is growing by 2.2% per annum, faster than Mexico City's, and much faster than New York's or Berlin's. 

Instead of expanding the rail and tram networks bit by bit over the last 3 decades, a string of inept governments has flubbed the expansion of public transport in the metro area.  Trains, trams and freeways are jam-packed, making daily commuting slower and slower and more and more unpleasant.  Melbourne is one of the few big cities in the world without a railway line to its airport.  A monorail to the airport would make travelling to and from Melbourne a far pleasanter experience, and  in fact a wider monorail network would nicely complement the existing tram and the rail systems.  A monorail can be situated down freeway medians, along arterial routes, and through densely  built up areas, whereas trains would have to routed underground (v. expensive) and new tram routes would require closing the roads where they are to be located for up to 3 years, temporarily worsening congestion.  What's true for us would be true for many cities round the world.


When it launched, BYD said this about its monorail:

As a mass transit alternative with relatively smaller passenger capacity, BYD’s “SkyRail” delivers numerous benefits, including: capital expenditure 80% lower than metro, construction period two-thirds shorter than metro, excellent topographic adaptability due to higher climbing ability and smaller turning radius, reduced noise to allow travel through architectural complexes, visual integration into the cityscape thanks to transparent bridges and independent right of way, flexible management to allow for capacity between 10,000 to 30,000 passengers an hour (each way) and a high speed of up to 80km/h. It is very applicable to small and medium sized cities, heavy traffic routes, CBD’s and routes connecting tourist attractions in large cities. 

[Read more here]

At the time, I wondered how many systems BYD would sell.  I admit to being skeptical.  I was wrong.  The first has just opened in the Chinese city of Yinchuan, there are 10 systems under construction and another 30 systems starting construction next year, all in China.  And my guess is that if mayors of other cities see it working in China it will be widely installed across the world.

Reducing traffic congestion in large cities and metropolises will need the expansion of mass transit.  London's Crossrail project is a good example of a high density--but very costly-- metro rail project.  For smaller cities BYD's SkyRail looks attractive.  We might even get one in Victoria.