Battery cell costs to halve again

 Hat tip to Anish Kumar Sinha

Battery pack costs are higher than cell costs, but even so, LFP (Lithium-Iron-Phosphate) battery pack costs could drop from the current $94/kWh to  $60/kWh or below.  And that's before sodium-ion batteries go into mass production.

It's really simple: the market share of EVs is heading inexorably to 100%.  

Even in countries with high import tariffs on imported EVs (US/Europe), the cost of Chinese EVs will fall so fast that domestic EV prices will have to respond, leading to rising EV sales.  Not to mention Chinese EV companies opening new EV plants in S.E. Asia, Latin America and Africa.  

With electricity generation, ultra-cheap batteries will allow 24/7 solar power in sun-belt regions of the globe (35 degrees S to 35 degrees N), and mixed solar/wind in higher latitudes.  Beyond latitude 60 degrees, some form of long-term storage will be needed, prob'ly green hydrogen/green methane/green methanol.  But all this can be done using renewables, not fossil fuels. 

This revolution cannot be stopped by big oil.  Demand for coal and oil will fall progressively.  And global emissions will fall too.

Pan-Europe wind & solar = stable output

 A most interesting thread from Sarastro on Bluesky.

The past two days we [have] seen something interesting in the European power market: continent wide balancing that is providing security of supply at the lowest prices driven by commercial incentives…

We know that solar and wind and inverse output characteristics. A system that contains both is more secure than one or other alone. This chart from @ember-energy.org makes the point on a European wide scale

 

You can see that on a European wide scale the combined output of wind and solar is less intermittent than solar and wind alone. These charts do not show the risk of hourly balancing though so you still need a source of flexible generation. [Or storage]

This morning we can see that in action. The French grid is importing power from Spain and exporting it to other markets across the French grid in Northern Europe. That’s how you get solar from southern Europe to Northern Europe and wind from the north to the south

 

But take a look at the output of the French nukes: the French have reduced nuclear output in response: they are not just wheeling power across the French system they are managing the French system for cost and using the nukes as a battery

It’s a revelation for those (like me) who have thought of nuclear has inflexible. EDF is showing us that at the heart of the European grid is a huge battery, its nuclear park, capable of firming both south solar and northern wind.

Yesterday we saw something similar with wind from the uk being imported into France and French exports to other European countries

But critically the nukes modulating output…

A couple of points:

1.  I've talked before about how wind and solar tend to balance each other, not just daily, but also seasonally.  It's not perfect, but on a continent-wide grid (as in Europe) the necessary storage/dispatchable power needed (such as gas) is significantly reduced from what would be needed if just wind or just solar was used.
2. Like Sarastro, I also did not know that nuclear could be ramped up and down.  Notice that the percentage moves are small --- roughly 20% --- but because nuclear is so large in European generation, that's enough to go a long way to balancing total grid output.  From the top chart, I estimate the seasonal variability of wind and solar together as ~10% of total output.
3. New nuclear is still much more expensive than new wind+solar combined with 5 hours of storage.  In Australia (without nuclear), 5 hours of storage with 20% overcapacity of wind and solar is enough to provide a stable grid for 99% of the time.    The tricky period seems to occur in July (mid-winter in Australia), when periods of little wind combine with low insolation and high demand for heating, a situation which is called dunkelflaute.  Even though this is a problem only 1% of the time, it would be unacceptable to close down the grid.
4. The solution, until we get better methods of long-term storage, is gas.  Currently, natural gas, but plausibly, in future, synthetic natural gas via the Sabatier process, produced using surplus green electricity.  
5. Alternatively, concentrated solar power (CSP) may do the trick.  Vast Solar, an Australian company, is busy constructing a CSP plant at Port Augusta in South Australia (on the edge of the desert, with lots of sunshine and heat --- CSP doesn't just use light, as solar panels do, it also uses infra-red, otherwise known as heat.)  CSP provides much more storage than batteries (1 hours compared with 4), so is much cheaper for long duration storage.  (Now called Vast Energy, the 30 MW CSP plant is yet to be started, with start-up now planned for Q2/2025.  However, they will now be co-producing green methanol at the plant as well)

The concentrated solar power phoenix

A few years ago, concentrated solar power (CSP) looked as if it was going to be an immensely valuable resource to increase the share of renewables in the grid.   

CSP used mirrors to concentrate the rays of the sun on a central "receiver" which got so hot it melted sodium salts.  These molten salts (at ±600 C) could be used immediately to boil water to create steam and drive conventional turbines to generate electricity, or they could be stored to be used later, typically overnight.  The molten salts in their special reservoirs lost heat very slowly, so could be stored for days or even weeks.   

The cost of the CSP power station lay mostly in the mirror array and the receiver, not the storage, so adding storage was much cheaper than adding storage via batteries to solar panels is.  In principle, CSP could provide baseload power more cheaply than coal and much more cheaply than nuclear.   The only problem was ..... the storage tanks kept on cracking, leaking the molten salts and reducing or stopping output.  And so, the CSP dream ended.   

Except it didn't.

An Australian company, Vast Solar, developed storage tanks which were flexible enough not to crack, with a modular system which allowed bigger CSP plants.  I talked about it before, here.

Well, Vast Solar is going from strength to strength.  It's being listed on the NYSE, and has expanded its development pipeline to 3700 MW, with 230 MW of projects under development.

Now that the technology works efficiently, the potential to scale is dramatic. The total addressable market for CSP by 2050 will be between 700 and 1,800 gigawatts (GW), with a revenue potential of over $3.5 trillion, according to a top tier international management consulting firm. The International Energy Agency (IEA) forecasts deployment of up to 430 GW of new CSP capacity globally by 2050 for on-grid applications alone.

That leaves room for many players to succeed but Vast Solar is a first mover [and owns the copyright to the flexible tanks] – and [is] already getting a piece of the pie. The company has 230 megawatts of projects under development, with a total pipeline of 3.7 GW, as of February 2023.

Large governments around the world are firmly backing the business. Up to A$ 215 million of funding has been committed by the Australian and German governments.

Importantly, the technology is tried and true, with CSP v3.0 already piloted for over five years and de-risked through a grid-synchronized demonstration plant that’s operated for nearly three years. The modular tower modality and sodium-based heat transfer technology provide a design that increases reliability and efficiency, while reducing complexity, cost and construction time.

To accelerate deployments in the US, the Inflation Reduction Act (IRA) is expected to materially improve project economics through the 30+% investment tax credit. The partnership between NETC and Vast Solar represents an attractive entry point for some of the most topical energy transition macro themes: dispatchable power, storage, process heat and green fuels.

Traditional storage solutions come with many compromises such as cost, safety and supply chain issues. CSP offers a variety of key features, including carbon-free, dispatchable power and heat, lower cost technology for sun-belt countries, highly efficient systems with minimal losses, integrated energy storage with thermal batteries that charge themselves with daylight, and a low-risk supply chain consisting primarily of glass and steel.

CSP solves two problems that wind and solar photovoltaics (PV) cannot. Wind and solar PV are intermittent generators. Adding battery storage allows wind and solar PV to be dispatched, but only with limited duration, at a high cost and with significant trade-offs. CSP provides efficient long-duration storage which makes it comparable to traditional fossil generation.

Decarbonizing manufacturing is challenging because many industrial processes require heat that can only be efficiently generated by burning fossil fuels. CSP can generate process heat equivalent to burning fossil fuels, allowing manufacturers to decarbonize.

Vast’s Modular Tower is a new and innovative approach to CSP that seeks to address the challenges facing conventional CSP. The Modular Tower utilizes molten sodium as its heat transfer fluid, which enables a modular tower design that unlocks benefits that collectively drive down costs and de-risk the operation.

These provide a variety of advantages, including reduced construction time, locational flexibility, lower operational risk through better thermal process control, higher operating temperatures delivering improved plant economics in both salt storage and turbine efficiency, and the ability to alter dispatch to meet changes in grid circumstances.

Additionally, modular towers offer a safer and cheaper way to conduct maintenance on a smaller tower and receiver, increasing the ability to meet customer requirements for both power and heat.

Turning to deployment goals, the company has a focus on several sunny regions, including stretches of North America, Europe/Middle East, APAC, Latin America, Central and South America, and Africa.

One proof point is Vast Solar’s 50-megawatt Mount Isa solar thermal plant, located in northern Queensland state, which is also a testament to the growing demand for renewable energy. The isolated mining community will benefit from the plant, which incorporates technology that allows heat from the sun to be stored for up to 16 hours.

[From Yahoo!Finance] 

Because CSP enables longer storage than batteries, it will play a key part in the renewable grid, and it will reduce the need for gas peaking.   The grid of the future will have wind, solar, CSP, and other lesser sources of green electricity (micro hydro, wave power, tidal power).  The greater the variety of generation sources, the more stable the output.

In addition, Vast Solar has also signed a LOI (Letter of intent) to build a green methanol plant co-located with its CSP plant at Port Augusta in South Australia.  Green methanol (CH₃OH) is much more useful than green hydrogen, because it can be stored and transported at room temperature.  See this article and this one about green methanol.  I wrote about methanol here, and you can read other pieces I wrote here. 

Methanol is another way of storing surplus electricity indefinitely.    So both these initiatives will make it easier to get to zero carbon.

Solar & wind into petrol

 

I expect we've all seen those ads inviting us to send $50 for the secret of how to run your car on water instead of petrol (gasoline).  Well here's something far more convincing. [From Science Mag]

[See update, here]

SAN FRANCISCO, CALIFORNIA—On a warm March day here, you could almost mistake Rob McGinnis for a huckster newly arrived in a frontier town as he delivers a rapid-fire pitch to an audience of thousands of would-be investors. McGinnis, a chemical engineer and entrepreneur, isn't hawking snake oil, however: His elixir is gasoline. Nearly everyone in the developed world is hopelessly addicted to it. Collectively, we use nearly 3 trillion liters every year.

At the pitch fair, McGinnis wears the Silicon Valley entrepreneur uniform of jeans, a black T-shirt, and black leather biker boots. On a theater-size stage, he delivers his spiel, sandwiched between 3-minute presentations for an online personalized clothing store and an outfit that would rent scooters by the month. "We make gasoline from air, water, and electricity," McGinnis announces. "Today, gasoline sells for $3.50 a gallon in California. Next year, we will be selling it for $3 per gallon." Other startups peddling ideas at the fair foresee markets in the billions, but McGinnis aims higher. "We're talking about a $2 trillion [per year] gasoline market," he says.

If all that sounds too good to be true, it might be. "I hope they're right," says Olgica Bakajin, CEO of Porifera Inc., a San Leandro, California, company that has also worked on systems like those at the heart of McGinnis's fuelmaker. But she notes that McGinnis "is a good talker who sells things well."

Synthesizing gasoline, instead of refining it from oil, isn't a new idea. German chemists in the 1920s discovered they could turn coal into carbon monoxide (CO) and hydrogen—a combination known as synthesis gas. Catalysts, along with heat and pressure, could then transform synthesis gas into gasoline and other liquid hydrocarbons.

But McGinnis's setup requires no heat, pressure, or coal. It uses only air, water, and electricity, which can come from the sun or wind. And with those renewable resources becoming ever cheaper, he's betting he can deliver gasoline more economically—and far more cleanly—than companies that must find oil, drill for it, ship it, and refine it.

Several other startups and academic labs are pursuing the same dream. "There has been a lot of progress in the last few years" in turning CO2 into more-complex compounds, says Peidong Yang, a pioneer in the field at the University of California, Berkeley.

Yet many of those efforts have stumbled over the expensive, energy-intensive steps needed to separate the hydrocarbons from the water they are produced in. Prometheus relies instead on a proprietary carbon nanotube membrane sieve that it says readily parts the hydrocarbons from water. "If they indeed have a low-energy separation process, that solves a big problem," Yang says.

Synthesizing the fuel is the easy part. Peidong Yang's team and groups at Oak Ridge National Laboratory (ORNL) in Tennessee and the University of Illinois in Urbana have published papers in the past 3 years showing that electricity and nanosize copper catalysts can turn CO2 and water into a mix of alcohols. And startups including a New Orleans, Louisiana, company called ReactWell are pursuing related approaches.

Thus far, the ORNL team has reported the highest efficiency, turning 23% of the electrical energy into fuel. [For comparison, Tesla says its lithium-ion batteries are ~90% efficient] But all the groups using the approach to make alcohols face the challenge of separating the fuel from the water. McGinnis says his membranes are the answer. They are "the new piece in the puzzle no one else has."

In the air-to-fuel machine he hoped to demonstrate at Y Combinator, the membranes filter a liquid that flows from a meter-wide chamber containing two electrodes dunked in water. When air blows through the chamber, the CO2 it contains reacts with water, producing carbonic acid—the same molecule acidifying the oceans. That acid, in turn, reacts on a copper catalyst coating the negative electrode, or cathode, to create CO. The cathode also strips protons off water molecules, leaving behind negatively charged hydroxide ions. Those ions travel to a positively charged electrode, or anode, where they react to form water and oxygen gas. Meanwhile, at the cathode, multiple CO molecules and protons are transformed into ethanol and other alcohols.

The result is the alcohol and water mixture that goes through the nanotube fibers. Prometheus has repaired its machine since the pitch fair, and it produces "a pretty steady drip" of fuel, McGinnis says: 10 milliliters per hour of alcohol that trickles out a red valve in the back. Over the next month, McGinnis and his colleagues plan to increase the size of their electrodes and catalysts to raise the production rate to 50 to 100 milliliters per hour.

Ultimately, McGinnis plans to add a second catalytic step using commercially available catalysts called zeolites, which would convert the mix of alcohols to the larger hydrocarbon molecules found in gasoline. "All of the pieces of this process have been proved to work. But no one has put them all together," he says. "Until now." He expects the device, when optimized, to produce 20 liters of gasoline per week.

[It's a long article, and worth reading.  You can read the rest here]

The article is a little doubtful that the process will work.  But BMW seems to believe it'll work.  It's invested $12.5 million into McGinnis's company.

Peak emissions closer than you think

Michael Liebreich is the doyen of energy change analysts.  He founded New Energy Finance which was bought by Bloomberg to become BNEF.  

I've taken extracts from this piece published on BNEF's blog.  (The emphases are mine)  If you don't want to read the whole piece, see my summary at the end.

I believe the new decade will see us hit peak energy-related greenhouse gas emissions and start to see a modest but meaningful decline. Just to be clear, we will not see the sort of decline demanded by the Intergovernmental Panel on Climate Change – a 20% cut by 2030 to keep temperature rises to 2C, a 45% cut to remain under 1.5C – but I would guess at a drop of around 5%.

Clearly that is not enough to put us fully on track to avoid appalling climate change impacts, and by 2030 we will have to admit 1.5C is out of reach. But it will be a game-changer: it will demonstrate to even the most pessimistic that we can bend the arc; it will end the feeling of helplessness and impending doom that has taken over our public discourse; and it will set us up for much more decisive reductions in the subsequent decades.

Optimism, therefore, but not without limits. It’s hard to be an unbridled optimist. Over the past decade, global emissions have risen by 15%. For one brief three-year period, between 2013 and 2016, they were flat – for the first time ever outside major recessions – but in 2017 they took off again, as the global economy boomed and China reverted to pumping cheap money into high-carbon infrastructure and building. Since then, emissions have been growing by around 1.2% per year.

[But,] while emissions grew 15% over the past decade, the global economy grew by 45%. On average, economic growth outstripped emissions growth by 2.4 percentage points per year.  [I.e, energy intensity fell by 2.4% p.a.] If that gap can be made to increase by just 1.4 percentage points, emissions peak, even in a growing economy. Increase it beyond that and we are over the hump: emissions will start to fall. Impossible pipe dream? Or something we will see in the course of the next decade?

First of all, the maths.  In 2017, a report by the World Resources Institute (WRI) showed that there were 49 countries, representing 36% of global emissions, which have already passed peak emissions [even though they have growing economies]. Almost the whole of the OECD is reducing its carbon footprint, even when you adjust for imports (something the ‘degrowth’ brigade pretend is impossible). The WRI expects a further eight countries, representing another 23% of emissions, to peak within the next decade.

Last week, in Paris, I attended the first meeting of the International Energy Agency’s Global Commission for Urgent Action on Energy Efficiency, of which I am a member. The Commission’s goal is to raise the rate of improvement in global energy intensity from its current 1.5% to 3% per year.

I have three main takeaways from the meeting: 1) energy efficiency is finally gaining recognition as a national priority in many countries, whether for climate or energy security reasons; 2) there is as much ‘low-hanging fruit’ today as there ever was; 3) there is a far better understanding of how to deliver improvements than a decade ago.

As we close out the decade, BNEF has concluded that around two-thirds of the world’s population now live in countries in which wind or solar are the lowest-cost ways of generating power. The world records for low-cost wind and solar are both now down to around $17/MWh. That is around a third of the cost of new gas-powered generation – even in the U.S., where there is a glut of cheap gas.  [Averages are of course higher, for both renewables and coal]

By 2030, I have no doubt whatsoever that the world record for low-cost onshore wind and solar will be below $10/MWh. It will probably be set in China, Morocco, Mexico or the Gulf states, who have been vying for leadership for the past decade. However, there is a chance it could be in India, Brazil, the U.S. or even Australia.

As we approach the final days of 2019, wind and solar are generating around 8.5% of global electricity. BNEF estimates that figure will be nearer 25% by 2030.

The biggest unanswered question, as renewable penetration grows, is whether the cost of managing intermittency will drop – with cheaper storage, growing demand-response capacity, business model innovation and smart policy design – as claimed by fans of renewables – or soar, as claimed by their opponents.
It’s a vital question, which will decide whether wind and solar can maintain their historical growth rates, or whether their penetration must soon saturate. All the main energy models are designed around the idea of renewable energy saturation: growth rates decelerating into the future – whether abruptly or slowly, but always markedly decelerating. The IEA’s central scenario, Stated Policies or SPS, has the combination of wind and solar reaching only 24% by 2040. BNEF’s NEO model, always more bullish, shows them at 39% in 2040 and 48% by 2050.

What if these models are wrong? What if learning, innovation and the co-evolution of demand-side industries continue to win the race against the physics of intermittency, and allow historical growth rates to continue for a few more decades?

Two decades ago everyone assumed that the cost of managing intermittency would soar after the first 5% of wind and solar entered the power mix; a decade ago we thought the inflection was 20%; now we know it is not this side of 40%. Modelling exercises around the world suggest that it is not until you reach 80% or more in any decently-connected grid that the cost of managing intermittency really starts to go vertical.  [But of course, by the time we get to 80% renewables, (a) storage costs will be much lower, and (b) overcapacity will be much cheaper]

To believe in a renewable energy singularity, the first thing to do is to extract all the latent flexibility in our current power systems, and then build more, in the form of power storage, demand response, long-distance interconnections and linkages with transport and heat. We’ll see a lot of that in the coming decade.

The second thing we need to do is learn to love overcapacity. As I said in a keynote in 2014, in a high-renewables system, overcapacity is not a bug, it’s a feature.

The average capacity factor of the world’s hydro plants is 42%; gas peaking plants 15%. Even so-called baseload coal plants run on average only 54% of the time. If technology is cheap, and demand or supply are intermittent, we overbuild. Wind and solar are no different.

Will we build many weeks’ worth of power storage, or hydrogen electrolysis, just to capture peak renewable electricity that would otherwise go to waste? In a word, no, because curtailment will be cheaper. Think about it: if your $20/MWh wind or solar suffers 33% curtailment, you know what happens? It turns into $30/MWh wind or solar – still half the price of power from any other source.

The third thing you would need to see if you want wind and solar to sustain their current growth rates is significant electrification of transport, (which I don’t think anyone doubts is on the cards – Daimler Benz clearly things so, for the first time in 135 years it is not working on the next generation of internal combustion engine) and heating (which, with global heat pump sales growing at 12% per year for the last decade, might finally be kicking off).

The fourth thing would be the electrification of industry and the generation of green fuels, be they hydrogen, ammonia or liquid fuels like methanol. It is hard to believe it was just 18 months ago that I wrote about this in Beyond Three Thirds: The Road to Deep Decarbonization, because there has been so much progress since.

BNEF’s seminal work on the cost of electrolysis suggests that green hydrogen (based on renewable power) will start to be competitive with brown hydrogen (from steam methane reforming of natural gas with no carbon capture) by 2030, and that by 2050 it will have a clear advantage. That means that, even in the absence of a carbon price, green hydrogen has the chance to eliminate the 5% of global emissions that currently result from fertilizer production and oil refining. A $20 carbon price would see it eat into the 2.2% of emissions from the global shipping industry. A $50 carbon price pushes green hydrogen into the 13% of industrial emissions from steel and concrete; and a $100 carbon price would take it into space heating, glass and other sectors. So the combination of cheap green hydrogen and a $100 carbon price will create an addressable market by 2050 of nearly 30% of global emissions. Neat.

Let’s talk about the fifth driver of a potential renewable singularity: batteries. By 2030, EV batteries will cost around $65/kWh at the pack level. [Assuming a compound 15% p.a. decline, $65/kWh will be reached in 2024] That’s $6,500 for the battery in a full-sized vehicle with a range of 300 miles; $13,000 gets you a 600-mile range – certainly bigger range than my bladder can handle. [And the batteries in small 'city cars' with 40 kWh will cost just $2600] 

All the pinch-points in the mineral supply chain will have been long ironed out, and by 2030, all end-of-life batteries will be recycled – if there are any.

Yes, you read that right. Solid-state batteries may or may not have hit the market, delivering four-times the energy density, and launching swarms of electric planes. But there will certainly have been continued progress in lithium-ion technology towards the “million-mile EV battery”, which can deliver 10,000 charge cycles. It will make possible either cars with 50-year lives, ubiquitous vehicle-to-grid business models, or second-use applications at scale – or all three. Mindblowing.

Oh, and by 2030, you will not even remember about range anxiety – the same way you don’t remember that there were once insufficient modems to connect to the internet, or insufficient bandwidth for online video. 

Those who doubt the value of renewable energy in addressing climate change always point to negligible impact so far. Even at 8.5% penetration into power demand – and after investment of $2.7 trillion – wind and solar have only reduced global emissions by only around 2.5% from where they would otherwise have been. They have so far failed to absorb growth in energy demand.

That is to miss the point. As leading energy economist Professor Michael Grubb has pointed out in Conditional Optimism: Perspectives on Deep Decarbonisation, the key clean technologies are growing according to the dynamics of logistic curves, penetrating into incumbent technologies. Professor Grubb uses lots of fancy economics to forecast what might happen next. I’ll paraphrase: in a logistic curve penetration, the first 1% takes forever; from 1% to 5% is like waiting for a sneeze –it is going to be explosive, you just don’t know when it will happen; 5% to 50% happens much faster than you think – that is when the restructurings and bankruptcies happen.

No single “sneeze” will wipe out fossil fuel use across energy and transport; It will occur sector by sector, country by country. Over the past six years, LED light-bulbs have gone from less than 5% global market share to over 40%; coal power in the U.K. from 40% to a couple of percent; plug-in vehicles in Norway from less than 5% to over 50%. In each case, there was a slow start, an agonizing wait, and then the sneeze. Bless you!

What does all this mean for coal consumption? According to Global Energy Monitor (formerly Coalswarm), in the final 2.5 years of this decade, global coal capacity grew by an average of 56GW or 2.8% per year – which hardly looks like a harbinger of peak emissions.

India and China alone have between them a pipeline of 280GW of new plants, bigger than the entire current U.S. fleet and equivalent to 15% of current global capacity. However, this does not begin to tell the full story.

First, what really matters is not capacity, but how much coal is actually burned. Over the past decade, capacity factors for thermal generation have been falling around the world, in China’s case to record lows. Globally – not that you would know it from the mainstream news – coal consumption in the power sector has been flat since 2012; preliminary figures for 2019 show a drop of around 3%.

Just this month it was announced that over half of the power plants operated by China’s Big Five state-owned utilities are running at a loss. The government has plans for up to one third of them to shut by 2021, removing 15% of the country’s coal capacity. As for India, despite its 85GW pipeline, on average it has commissioned less than 10GW per year for the past three years. This September, Prime Minister Narendra Modi announced a push for 450GW of zero-carbon generation by 2030.

In the EU, eight out of 28 countries have already committed to phasing out coal by 2030; it will be entirely gone in the U.K. by 2025.  Germany, having prioritized the closure of nuclear over coal to date, will be off coal by 2038. The EU’s Green Deal, announced last week by new President Ursula von der Leyen, included 35 billion euros of support for Poland and other countries to get off coal.

In the U.S., despite promises to end the so-called “war on coal”, more coal capacity has been shuttered under President Trump’s first term than during any three years of the Obama administration.  Every publicly-quoted coal company has gone through Chapter 11 since 2016, as has privately-owned Murray Energy, whose CEO, Robert Murray, wrote the blueprint for the president’s energy policy. Not one new coal plant has been built since 2015. None are being built today, and it looks like none ever will be again.

Of course, coal is used outside the electricity sector, notably in heating and industry. That source of demand looks likely to carry on increasing for a few years at least.

Before 2000, the orthodox view of oil demand (and energy analysts always default to orthodoxy) was that by 2030 it would grow to around 130 million barrels. By 2000, oil demand was still expected to grow forever, but it would reach only 120 million barrels by 2030. By 2010, the accepted wisdom was still endless growth, but only 105 million barrels of demand by 2030. See the pattern? Oil demand growth consistently undershooting the growth predicted by experts.

At no point did it cross the experts’ minds that maybe the same trends that they kept missing would see oil demand peak, and then start to fall. When I first suggested it in 2015, it felt like a transgressive act.

Today, there is not an oil company in the world that is not talking about peak demand. Even Saudi Aramco’s recent IPO prospectus predicted “a levelling-off around 2035”. BNEF expects demand from light and heavy vehicles to peak in 2030; this is one of the rare times I depart (slightly) from its view. I see peak road transport demand around 2025; add in the growing areas of air transport, shipping and petrochemicals, and I think we’ll see peak oil this side of 2030.

So far, you will notice I have barely mentioned policy. The picture I have painted is a bit like the IEA’s Stated Policies Scenario: these trends, which should see emissions from fossil fuels peak by 2030, are what I see happening even in the absence of significant further policy in favor of climate action.

But, of course, there will be further climate policy – and lots of it.

In the U.K., the new Johnson government is committed to achieving net zero by 2050. At this September’s Climate Action Summit in New York, 77 other countries, 10 regions and over 100 cities announced their intention to follow the U.K.’s lead. As I write this, the EU has just unveiled its Green Deal, which is going to enshrine a 2050 net zero target in law, as well as a plan to reduce greenhouse gases by “at least 50% and towards 55% by 2030, in a responsible way”.

In Canada, Justin Trudeau hung on to government, albeit not his parliamentary majority, in this year’s General Election. The country is therefore the first to implement the sort of tax-and-dividend scheme that could be a model for carbon pricing in political economies where new taxes are all but impossible to impose.

In the U.S., climate is a key battleground for the Democratic Party Primary, but what is more interesting is that Republicans with an eye on political life after President Trump are finally conceding they too need a climate policy.

Even the international climate negotiations should be expected to deliver some level of positive mood music over the coming decade, despite the potential withdrawal of the U.S. from the Paris Agreement and the failure of the latest COP conference in Madrid, as I describe in the sister-piece to this article, Climate Wars Episode IV – a New Hope for the 2020s?.

So there you have it – the reasons why I believe we will see peak fossil fuel emissions during the coming decade. 

The small inset chart shows atmospheric concentrations of CO2, the larger chart annual increases in CO2 concentrations.

RCP means representative concentration pathway.  RCP2.6 would be consistent with a 1 degree C rise in temps, RCP4.5 1.8 degrees C.  Liebreich's analysis suggests something between RCP2.6 and RCP4.5.  If emissions only peak in the late 2020s, policy shifts as panic about climate change increases could lead to a much steeper decline thereafter.

To sum up:

• Renewables are going to get insanely cheap.
• Thermal coal demand will peak before 2030
• Peak oil is within sight
• The green hydrogen/methane economy will be cost competitive by 2030, and at $100/tonne carbon price, will replace 30% of emissions
• energy saving still has plenty of low hanging fruit.
• renewables overcapacity will be a design feature in electricity generation.
• CO2 emissions will peak before 2030, and by 2030, will be 5% lower than they are now

I've made a lot of these points before.  Liebreich makes them better, and with greater authority.

Cement produces more CO2 than trucks

From Bloomberg:

The most astonishing thing about cement is how much air pollution it produces.

Manufacturing the stone-like building material is responsible for 7% of global carbon dioxide emissions, more than what comes from all the trucks in the world. And with that in mind, it’s surprising that leading cement makers from LafargeHolcim Ltd. in Switzerland to Votorantim Cimentos SA in Brazil are finding customers slow to embrace a greener alternative.

Their story highlights the difficulties of taking greenhouse gases out of buildings, roads and bridges. After wresting deep cuts from the energy industry, policymakers looking to extend the fight against global warming are increasingly focusing on construction materials and practices as a place to make further reductions. The companies are working on solutions, but buyers are reluctant to pay more.

While architects and developers concentrate on the energy used by their buildings, it’s actually the materials supporting the structure that embody the biggest share of its lifetime carbon footprint. Cement’s contribution to emissions is especially immense because of the chemical process required to make it.

About two-thirds of the polluting gases that come from cement production stem from burning limestone. Kilns are heated to more than 1,400 degrees Celsius (2,600 Fahrenheit), about four times hotter than a home oven set to the self-clean cycle. Inside the kiln, carbon trapped in the limestone combines with oxygen and is released as CO2, the most abundant greenhouse gas.

A ton of cement yields at least half a ton of CO2, according to the European Cement Association. That’s more than the average car would produce on a drive from New York to Miami. And a single mixer truck can carry about 13 tons. Hundreds or even thousands of tons go into ordinary office buildings.

What comes out of the kiln is called clinker, the key raw ingredient of cement. It’s the substance that, when mixed with gypsum and water, binds with gravel to harden and form concrete. Many companies are working to cut the amount of clinker in their cement, which requires new and sometimes untested recipes.

Others are looking at substitutes. Those include fly-ash, which comes from the chimneys of plants that burn coal, or slag from steel-making blast furnaces. They trigger a chemical reaction and form what’s known as a geopolymer binder.

Geopolymer cement has performance advantages and a huge sustainability edge over traditional mixes, according to Cameron Coleman, chief executive officer of Wagners Holding Co., which is based in Toowoomba near Brisbane in Australia.


“This alternative eco-friendly binder technology reduces the carbon emissions associated with normal Portland cement by 80% to 90%, and also has a much lower embodied energy,” Coleman said by email. “We have been working with leading companies in South East Asia, New Zealand, India, Europe and the Middle East who are extremely interested in adopting this technology.”

That strategy won’t work for long in Europe and the U.S., where fly-ash is the main clinker substitute and coal plants are closing. There, the focus is on efficiency and using fossil-fuel alternatives for heat. The European Cement Association says its producers already get 44% of their energy from cleaner sources and wants to raise that proportion to 60% by 2050. Instead of using coal, it’s creating heat with used tires, mineral oil and industrial waste.

[Read more here]

I am very confident that the world will replace fossil fuels in electricity generation within 20 or 25 years, and will convert most land transport to EVs over the same time frame.  This will happen because people are getting frightened by global heating and the climate emergency, and because the costs of these new technologies are plunging. Why not do something about global heating when you'll actually cut costs by doing it?

But that will leave agriculture, iron and steel and cement, which by 2040 or 45 could make up 80% of emissions.  There are alternatives in cement production as this article discusses.  There are others: I talked about green concrete here.  Iron and steel could be produced using methane or hydrogen to reduce iron ore to pure iron.  Unlike electricity from renewables or EVs, these will not be cheaper than their high-carbon equivalents.

Clearly, to encourage the update of low-carbon cement and steel, we need a price on carbon.  In Europe, there is one, currently €24 (US$ 27) per tonne of CO₂.  It's only a question of time before Europe starts applying that price to the carbon content of imports from countries which do not have a carbon price.  The surge of Greens in the recent European elections makes that inevitable.  All the conventional parties are starting to feel how the breath of environmentalism is starting to become a breeze and then a gale.  What's more, the current extreme heatwave in Europe, as bad as or worse than last summer's,  will only harden attitudes.  With a carbon price, cement and steel will start to produce low-carbon products.  And the only remaining sector to de-carbonise will be agriculture.  But it will happen there too.  Because it has to.

More storage? Or more capacity?

When wind and solar first started to be used for generation on the grid, the aim was to use as much of the power as they created because their cost was so high.  Curtailing output would just make an expensive thing even more expensive.  But the costs of wind and solar have declined rapidly, and continue to decline.  "Wasting" some of the renewables output by curtailment is more acceptable, and indeed, as renewables penetration has increased, necessary, when good wind and/or solar conditions mean that otherwise there would be too much output, leading to the grid burning out.

Also, studies have repeatedly shown that although little storage is needed at low levels of renewable penetration as penetration rises, more storage is needed, and the need rises exponentially after penetration reaches 70%.  I wrote a long piece a year ago summarising some interesting research, here.  In a grid without baseload generation, such as hydro or nuclear, even with a mixed 50%/50% wind/solar generation base, we would need 32 days storage to take the grid from 90% to 99.99% renewables.  At that time, I pointed out that we wouldn't be getting to 70% penetration for 20 years, by which time storage costs would have fallen by 99% if current trends continue.  Which they prob'ly won't—but the current 20% per annum decline will very likely continue for another 10 years at least, which will mean by 2030, battery costs will have fallen 90%.

But what if we just added extra capacity, instead of or in addition to storage?  First, that won't work with a grid with 100% solar.  No matter how much capacity you have, the sun doesn't shine at night.  Outside the tropics, some night-time demand will be satisfied by wind.  Without wind, i.e., just solar, you would need at least 12 hours of storage.  I've assumed 8 hours of storage (1/3rd hourly daylight demand x 12 hours) will be needed, plus wind, to be conservative.  This will cover the day-to-day fluctuations.  But what about seasonal deficits?  I mentioned 32 days of storage above, which would be essential to give the grid 99.99% guaranteed supply even in prolonged cloudy, wintry calm, when demand is high and supply low.  Or during an Arctic vortex event, such as hit the N.E. USA earlier this year.

Let's have a look at a potential example.  I went to the ever reliable PVWatts (run by by NREL) and got them to tell me how much power is generated each month on average in Minnesota.  Solar panel output is lowest in December (229 kWh from 4 kW of panels) and highest in July (629 kWh).  December output is 36% of July's.  So if you were going to run all of Minnesota on solar electricity, you would need triple capacity to provide for that one month in winter, and would dump/curtail lots of power in summer.  Of course, at such a high latitude, no one would run a grid just on solar.  So let's assume 50% wind, and allow for some variability.  In that case double capacity of wind and solar  (plus 8 hours storage for nights) should be enough.  Double capacity, though, would more than double the cost, because some output would be curtailed.  By my calcs, about 1/3rd of the excess capacity would be curtailed in Minnesota if solar capacity were doubled, so doubling capacity would be 2.3 times as expensive.  I'll come back to that in a minute, below the chart.

In the chart below (I've shown variations before) I've taken the average LCOE estimated by Lazard from their latest report for each year since 2009 for wind, solar, coal and gas.  Wind+solar is the average of wind and solar individually.  I've assumed that the rate of cost declines for the last 5 years continues for the next 3.  I've estimated battery costs using battery pack prices, and in a change from my previous published estimates, assumed a 30% premium for the concrete base, connection etc.

The different green lines in effect show the different cost structures as renewables penetrate the grid.  The solid green line is a 50/50 average of wind and solar without storage, and would be appropriate for low penetrations of wind and solar in the grid.  That crossed the coal line in 2012.  The dotted green line adds the cost of 8 hours of energy, and would be appropriate for 40 to 60% penetration in the grid.  That combo became cheaper than new coal in 2015.  The dashed green line shows the costs of doubling capacity, still with 8 hours of storage, which is still though not for much longer, more expensive than coal.   However, that's a conservative estimate, as I'll explain below.

What would happen if large chunks of potential electricity generated were to be wasted via curtailment?  It would be "free" electricity.

First off, wind and solar farms would add more on-site storage so that when they were told to curtail output by the grid operators, they would divert production to their own storage for delivery later.  For example, wind blows all the time, but demand is mostly in the day.  In South Australia, with 50% renewables penetration, most of it wind, wholesale prices can go negative in the wee hours.  So why not store their surplus production then for delivery into the afternoon peak, when wholesale prices soar?  Of course, that's just what they would do.

And for prolonged periods of surplus output, say during summer, it would make sense to store that surplus energy as hydrogen or as synthetic natural gas.  Just to remind you, you take green electricity, use it to split water into hydrogen and oxygen, pass the hydrogen with CO₂ over a catalyst at high pressure and temperature, and that gives you methane.  This is called the Sabatier process, and I have talked about it often.  There is a 65%+ energy loss in this process, plus capturing the CO₂ from a gas power station flue adds $6-$34/MWh.  But if the energy is "free", the energy conversion loss is irrelevant.  And thus power-to-gas becomes much cheaper.  So instead of curtailing output from wind and solar when supply is excessive, that surplus supply would be used to produce hydrogen and methane, which would be stored to cover high electricity demand in winter.  Curtailed output would then have some value, reducing the cost of the extra capacity.

Note that the conservative costings for doubling capacity, i.e., ignoring any revenue from selling otherwise curtailed output for power-to-gas, cuts across the coal cost line in 2020, and the gas line in 2023 (not shown on chart).   And that's US gas, which is a lot cheaper than in the rest of the world.

The future grid will have:

• a mixture of wind and solar, varying by latitude
• plant-level and prob'ly grid-level battery/pumped hydro storage equivalent to a minimum of 8 hours storage and likely more
• long distance HVDC lines to bring power from other regions where the weather and the climate is different
• much more generation capacity to ensure supply at times when wind is low and the sun isn't shining
• seasonal storage using the Sabatier process to create synthetic natural gas, i.e., methane, to provide reserves for winter.

And. it occurs to me, hydrogen-cell cars may actually be a thing.  I've always dismissed them before because of the costly energy conversion losses caused by producing hydrogen from electrolysis.  But if we need extra capacity in the grid, and the result is cheap hydrogen, hydrogen-cell vehicles might yet work.   Ditto, methanol fuel cells.



[Hat Tip to CleanTechnica which started me thinking, with this article: No Joke: We Should Build More Solar & Wind Than Needed — It’s Cheaper]

Green ethylene

Ethylene is a major industrial chemical, hitherto produced from hydrocarbons, and producing lots of carbon dioxide in its production.  Polythene/polyethylene is made from ethylene.

The University of Singapore has just discovered a process which produces ethylene from water and carbon dioxide at room temperature, using renewable electricity.

Artificial photosynthesis device developed by the research team

at National University of Singapore (Source: PV Magazine)

An artificial photosynthesis device developed by a team of of scientists from the National University of Singapore (NUS) could provide a greener alternative to current ethylene production, employing a completely renewable energy source, while simultaneously converting CO2 with the help of copper catalysts.

According to the findings published in ACS Sustainable Chemistry & Engineering, NUS achieved an unprecedented 1.5% solar-to-ethylene energy efficiency (the total solar-to-carbon-fuels energy efficiency is 2.9%).

Current industrial production of ethylene employs steam cracking of saturated hydrocarbons at 750°C to 950°C, which translates to an enormous consumption of energy, emitting about two tons of carbon dioxide for every ton of ethylene produced.The process, developed by the NUS team, takes place at room temperature and pressure, with only the use of benign chemical reagents.

The researchers have also added a battery to store excess solar energy, thus ensuring stable and continuous production of ethylene, and are now developing suitable catalysts that can be used in similar systems to produce liquid fuels such as ethanol from CO2 and H2O.

“We believe that our work, which is a product of efforts for the last two years, will play a crucial role to address key challenges in the realization of a scalable artificial photosynthesis system to produce clean fuels sustainably,” said assistant Professor Jason Yeo Boon Siang.

[Read more here]

Think about this: instead of producing two tonnes of CO2 per tonne of ethylene, this process will absorb about 0.8 tonnes of CO2 per tonne of ethylene produced (working from the molecular weights of hydrogen and carbon)  What's more, this process can be developed to produce methane, ethanol and methanol.

Of course, it isn't yet commercial.  And there's no mention of costs.  But in, say, 5 years' time, as it becomes ever more obvious that global warming is intensifying, and the consequences of climate change become more obvious and more serious, technologies like this will be embraced even if they are more expensive, because the costs of global warming will be obviously even greater. 

Years and years ago, The Economist magazine wrote an article after the first oil crisis, saying that it  would lead to a reduction in the oil intensity of economies as all the best brains in the world worked out how to use less oil for the same output.  That actually happened, to such an extent that oil prices then fell, and the decline in oil intensity levelled off.  Now the world knows with great clarity (despite the nightmare of Trump and the Republicans) that we have to slash carbon emissions to zero.  And the best brains in the world are working on it.

Methanol Fuel Cells

The MS innogy on Lake Baldeneysee in Essen (Source)

I'd heard about hydrogen fuel cells, but I'd never heard of methanol fuel cells before I read this article.  Methanol is made from methane, i.e., natural gas.  But methane can also come from green sources: biomass, or old rubbish dumps for example.  Or it can be made via the Sabatier process, which takes carbon dioxide, water and heat and produces methane.  So in principle, methanol can be carbon neutral, and if it is used in a fuel cell rather than burnt, it is silent, produces no nitrogen oxide (Nox) or particulate emissions.

After a ship-naming ceremony on Friday, the MS innogy is now ready to take passengers for a green tour on the beautiful Lake Baldeneysee. The MS innogy, the first vessel in Germany to be powered by methanol fuel cells, is a project by innogy, a leading distributor of green energy in Germany and the City of Essen. The methanol fuel cell system powering the vessel is developed and manufactured by the Danish fuel cell manufacture SerEnergy. 

About a year ago, the companies started to develop a plan to turn a diesel-powered vessel into an electric vessel powered by environmentally friendly methanol fuel cells. 

“We are very proud to see the vessel touring the lake in Essen, it is an important milestone in showing the potential of methanol as the green fuel of the future. For us, it has been a very interesting project to be part of, and since the project is a first of its kind we have had to think out of the box to create an ideal energy system matching the energy demands of the vessel”, says Mads Friis Jensen, Chief Commercial Officer at SerEnergy. 

Not only has the methanol fuel cell system zero harmful emissions and is CO2-neutral, it is also low on noise and vibrations, allowing the passengers to enjoy the tour without the characteristic engine noise and vibrations you normally experience on a vessel. 

The MS innogy is a part of innogy’s “greenfuel” project where they demonstrate the entire value chain of environmentally friendly methanol, from a green production of methanol using CO2 from the surrounding air, green electricity and water, to the use of methanol as fuel in the excursion vessel and in cars. The scene of the methanol value chain demonstration project is the City of Essen – this year’s “Green Capital of Europe” and the demonstration project goes hand in hand with the ambitious transition the city is undergoing in reinventing itself as a “Green City”.

[Read more here]

What are the advantages of methanol?

• Lower costs – Methanol is cheap and easy to produce. Typically, there is 15-60% fuel cost savings compared to diesel generators.

• Low to zero emission – Serenergy’s methanol fuel cells offer a CO2 neutral solution. There is a 50-65% CO2 reduction compared to diesel generators and no harmful emissions (NOX or particles).

• High efficiency – The fuel cell system offers a high efficiency compared to internal combustion engines. It has a complete system efficiency up to 50%.

• Reliability and low maintenance –The lack of moving parts in a Serenergy methanol fuel cell, especially compared to an internal combustion engine, signifies that the level of maintenance is low and the reliability of the system is thus very high.

• Energy security – Oppose to fossil fuel, such as petrol and diesel, methanol is a very flexible fuel, which can be produced from a broad range of feedstock, hence ensuring energy security.

• Scalability – The Serenergy methanol fuel cell modules are designed and available in customised sizes from 10 to 120 cells. Furthermore, two or four systems can be connected for higher power ranges. Consequently, this means that is a scalable power output of 1kWp to 6kW

• Quiet energy – A Serenergy methanol fuel cell system generates no (low) noise (<62dB) and no vibrations, which makes them ideal for power generation in residential areas.

• Technology compatibility – Serenergy’s methanol fuel cell solutions must be seen as complementary and not as a competitor, with other energy generation technologies. Especially renewable technologies.

(The benefits of methanol fuel cells)

A critical problem with the hydrogen or methane/methanol economy is that producing hydrogen via electrolysis from water has a substantial energy loss.  How much is lost depends on the precise process used.   But at best it's around 35%.  According to Tesla, their Powerwall battery is around 90% efficient.  So on the face of it, batteries are more efficient.  On the other hand, according to SerEnergy, methanol cells are 1.8 times as efficient as diesel:

Methanol and fuel cells is a good match. Methanol used in fuel cells is highly efficient and in many cases, it make twice as good use of energy as a combustion engine. Serenergy fuel cells have an efficiency of +45 %, whereas a combustion engine has an efficiency of 25-30 %. 

 (Why do we use methanol?)

This is still a developing technology.  But it's certainly interesting enough to keep one's eye on it.