Archive for the ‘Low carbon economy’ Category

From sunlight to Jet A1

In a world of near zero anthropogenic emissions of carbon dioxide, there remains the problem of finding a fuel or energy carrier of sufficiently high energy density that it remains practical to fly a modern jet aeroplane. Commercial aviation is heading towards some 1 billion tonnes of carbon dioxide per annum so doing nothing may not be an option.

Although planes will certainly evolve over the course of the century, the rate of change is likely to be slow and particularly so if a step change in technology is involved. In 100 years of civil aviation there have been two such step changes; the first commercial flights in the 1910s and the shift of the jet engine from the military to the commercial world with the development of the Comet and Boeing 707. The 787 Dreamliner is in many respects a world away from the 707, but in terms of the fuel used it is the same plane; that’s 60 years and there is no sign of the next change.

Unlike domestic vehicles where electricity and batteries offer an alternative, planes will probably still need hydrocarbon fuel for all of this century, perhaps longer. Hydrogen is a possibility but the fuel to volume ratio would change such that this could also mean a radical redesign of the whole shape of the plane (below), which might also entail redesign of other infrastructure such as airport terminals, air bridges and so on. Even the development and first deployment of the double decker A380, something of a step change in terms of shape and size, has taken twenty years and cost Airbus many billions.


For aviation, the simplest approach will probably be the development of a process to produce a look-alike hydrocarbon fuel. The most practical way to approach this problem is via an advanced biofuel route and a few processes are available to fill the need, although scale up of these technologies has yet to take place. But what if the biofuel route also proves problematic – say for reasons related to land use change or perhaps public acceptance in a future period of rising food prices? A few research programmes are looking at synthesising the fuel directly from water and carbon dioxide. This is entirely possible from a chemistry perspective, but it requires lots of energy; at least as much energy as the finished fuel gives when it is used and its molecules are returned to water and carbon dioxide.

Audi has been working on such a project and recently announced the production of the first fuel from their pilot plant (160 litres per day). According to their media release;

The Sunfire [Audi’s technology partner] plant requires carbon dioxide, water, and electricity as raw materials. The carbon dioxide is extracted from the ambient air using direct air capture. In a separate process, an electrolysis unit splits water into hydrogen and oxygen. The hydrogen is then reacted with the carbon dioxide in two chemical processes conducted at 220 degrees Celsius and a pressure of 25 bar to produce an energetic liquid, made up of hydrocarbon compounds, which is called Blue Crude. This conversion process is up to 70 percent efficient. The whole process runs on solar power.

Apart from the front end of the facility where carbon dioxide is reacted with hydrogen to produce synthesis gas (carbon monoxide and hydrogen), the rest of the plant should be very similar to the full scale Pearl Gas to Liquids (GTL) facility that Shell operates in Qatar. In that process, natural gas is converted to synthesis gas which is in turn converted to a mix of longer chain hydrocarbons, including jet fuel (contained within the Audi Blue Crude). The Pearl facility produces about 150,000 bbls/day of hydrocarbon product, so perhaps one hundred such facilities would be required to produce enough jet fuel for the world (this would depend on the yield of suitable jet fuel from the process which produces a range of hydrocarbon products that can be put to many uses). Today there are just a handful of gas-to-liquids plants in operation; Pearl and Oryx in Qatar, Bintulu in Malaysia and Mossel Bay in South Africa (and another in South Africa that uses coal as the starting feedstock). The final conversion uses the Fischer Tropsch process, originally developed about a century ago.

Each of these future “blue crude” facilities would also need a formidable solar array to power it. The calorific content of the fuels is about 45 TJ/kt, so that is the absolute minimum amount of energy required for the conversion facility. However, accounting for efficiency of the process and adding in the energy required for air extraction of carbon dioxide and all the other energy needs of a modern industrial facility, a future process might need up to 100 TJ/kt of energy input. The Pearl GTL produces 19 kt of product per day, so the energy demand to make this from water and carbon dioxide would be 1900 TJ per day, or 700,000 TJ per annum. As such,  this requires a nameplate capacity for a solar PV farm of about 60 GW – roughly equal to half the entire installed global solar generating capacity in 2013. A Middle East location such as Qatar receives about 2200 kWh/m² per annum, or 0.00792 TJ/m² and assuming a future solar PV facility that might operate at 35% efficiency (considerably better than commercial facilities today), the solar PV alone would occupy an area of some 250 km² , so perhaps 500 km² or more in total plot area (i.e. 22 kms by 22 kms in size) for the facility.

This is certainly not inconceivable, but it is far larger than any solar PV facilities in operation today; the Topaz solar array in California is on a site 25 square kms in size with a nameplate capacity of 550 MW.  It is currently the largest solar farm in the world and produces about 1.1 million MWh per annum (4000 TJ), but the efficiency (23%) is far lower than my future assumption above. At this production rate, 175 Topaz farms would be required to power a refinery with the hydrocarbon output of Pearl GTL. My assumptions represent a packing density of solar PV some four times better than Topaz (i.e. 100 MW/km² vs 22 MW/km²).

All this means that our net zero emissions world needs to see the construction of some 100 large scale hydrocarbon synthesis plants, together with air extraction facilities, hydrogen and carbon monoxide storage for night time operation of the reactors and huge solar arrays. This could meet all the future aviation needs and would also produce lighter and heavier hydrocarbons for various other applications where electricity is not an option (e.g. chemical feedstock, heavy marine fuels). In 2015 money, the investment would certainly run into the trillions of dollars.

What can really be done by 2050?

The calls for action are becoming louder and bolder as the weeks continue to countdown towards COP21 in Paris. Perhaps none have been as bold as the recent call by The B Team for governments to commit to a global goal of net-zero greenhouse gas emissions by 2050, and to embed this in the agreement to be signed at COP21 in Paris.

The B Team is a high profile group of business and civil society leaders, counting amongst its number Richard Branson (Virgin Group of Companies), Paul Polman (CEO of Unilever) and Arianna Huffington (Huffington Post). The team is not just looking at climate change, but the even larger challenge of doing business in the 21st Century; shifting from Plan A which requires business to focus on profit alone, to Plan B which encompasses a more holistic set of objectives around financial performance, sustainability and business as a force for good to help solve challenging social and environmental goals. It is perhaps the next big step forward in what was originally termed “sustainable development”.

Without wanting to question the broader motives of The B Team, I do challenge their view that the climate issue can be resolved in just 35 years. For some this may sound like a long time, but it is the span of just one career. In fact it is the span of my career in the oil and gas industry from when I started work in Geelong Refinery in Australia in 1980. At least in one industry today, IT, everything has changed in that time, but that is not true elsewhere. In 1980 there were no personal computers in Geelong Refinery; today it probably can’t run without them, although the distillers, crackers and oil movement facilities being run by them have hardly changed and in many instances are precisely the same pieces of equipment that were running in 1980. In almost every other industry, the shift has been gradual, perhaps because of the installed base which of course wasn’t an issue for personal computing and mobile telephony. I suspect that this is true in Mr Polman’s own industry (household products) and it is certainly true in Mr Branson’s. In 1980 I flew on my first trip to London on a 747 and today I am in San Francisco, having arrived here on a 747, albeit a slightly longer, more sophisticated, efficient and larger capacity one than the 1980 model, but still a 747 burning many tons of jet fuel to get here. During his time in office which started with the election in 1980, Ronald Reagan replaced the existing Air Force One 707 with a 747 which still flies today but which Mr Obama has just announced will be replaced with a 747-8. Those planes will likely fly for some 30 years, as will all the other planes being built today, with many just entering the beginning of their production runs (787, A350, A380), rather than heading towards the end as we might be with the 747 series. There are also no serious plans for the jet engine to run on anything other than hydrocarbons for the foreseeable future (i.e. 50+ years) and even the attempts to manufacture bio-hydrocarbon jet fuels are still in their commercial infancy.

So why would we think that everything can be different in just 35 years? There is no doubt that to quickly and decisively solve the climate issue and have a better than even chance of keeping the surface temperature rise below 2°C that we need to do this, but that doesn’t mean we can. To start with, there has to be tremendous political will to do so and to be fair, this is clearly what The B Team is trying to foster by making the call. But political will isn’t enough to turn over the installed industrial capacity that we rely on today, let alone replace it with a set of technologies that in some instances don’t exist. The development and deployment of radical new technologies takes decades, with the energy industry able to make that change at about half the rate of the IT industry. Even the latter has needed nearly 50 years to invent (ARPANET in 1969) and extensively deploy the internet.

We are now seeing real progress in the sale of electric cars, but even there the numbers don’t stack up. To completely outpace conventional vehicle manufacture and replace the entire legacy stock of on-road vehicles will take about 50 years, assuming a ramp up of global electric car production of at least 20% p.a. every year until all internal combustion engine manufacturing is phased out. While this might be conceivable for personal transport, the progress on finding an alternative for heavy transport, including ships, is slow.

For medium to heavy industry that relies almost completely on hydrocarbon fuels for high temperature operations in particular, there are no easy alternatives. Electricity could be an option in some instances, but almost all operations today choose coal or natural gas. For smelting, coal is essential as it provides the carbon to act as a reducing agent for the chemical conversion of the ore into a pure metal.

Perhaps the area in which rapid progress will be seen is electricity generation, where a whole range of zero emission technologies exist. These include wind, solar, geothermal, tidal, nuclear and carbon capture and storage. But even with complete success in this one area, we shouldn’t forget that electricity is less than 20% of the current global final energy mix. This will surely rise, but it is unlikely to reach 100% in 35 years given that it has only moved from 11% to 18% the last 35 years.

Shell’s own New Lens Scenarios show that significant progress can be made between now and 2050, but not in terms of a massive reduction in emissions, although that process is clearly underway in the Mountains Scenario by then (see below). Rather, the time to 2050 is largely filled with the early deployment of a range of new energy technologies, which sets the scene for rapid reductions to net-zero emissions over the period 2050-2100. Another critical development for the near-term is a complete global policy framework for carbon pricing. Even assuming big steps are made between now and Paris in even getting this into the agreement, the time for implementation is a factor that must be recognised. With a fast start in Paris, the earliest possible date is 2020 in that this is when the global agreement kicks in, but even the EU ETS took 8 years between initial design and full operation, similarly the CDM alone took over 10 years to fully institutionalize. Expanding full carbon pricing globally in the same period is challenging to say the least.

NLS Emissions to 2100

The aspiration of the B Team is laudable, but not really practical. The Paris agreement should certainly be geared around an end-goal of net-zero emissions but the realistic, albeit still aggressive, time span for this is 80+ years, not 35 years.


The first fridge in town

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The recent visit by President Obama to India and the resulting discussions on climate change between the President and Indian Prime Minister Narendra Modi have once again thrown the spotlight on India’s development pathway and its energy needs.

There were countless articles about the climate change discussions they had, but one story published by the BBC was particularly relevant and poignant. It was about Santosh Chowdhury, a gentleman who lives in the village of Rameshwarpur, on the eastern side of the country. He had just bought a fridge, which may seem uninteresting, but it was the first fridge in his village. There is one thing about refrigeration that is different to almost any other domestic energy consuming device, it requires fairly reliable 24/7 electricity. That means Mr Chowdhury, like many in his town who may now follow him, needs a grid connection and that grid has to be sending electrons his way all the time.

First fridge

This is the start of a long industrial chain that needs a modern energy system to support it. The fridge needs electricity on a 24/7 basis, which excludes the immediate application of renewable energy as the primary provider. Some sort of back-up or energy storage mechanism will be required. In India, given cost considerations, the baseload electricity will likely be generated with coal although it is clear that India are also looking towards nuclear. Solar energy will augment this and at certain times may provide for all Mr Chowdhury’s needs, but unless the town spends considerably more money and installs a more complex grid system with battery capacity, the dependency on coal will continue, at least in the medium term.

But the story doesn’t end there, given that electricity provides only about 20% of final energy needs globally and in India this falls to 15%. The lack of fridges in Rameshwarpur reflects the situation across the whole of India. The BBC article notes that only one in four of the country’s homes has one. That compares to an average of 99% of households in developed countries. In 2004, 24% of households in China owned a fridge. Ten years later this had shot up to 88%. India has about 250 million households, which approximates to 60 million fridges. By 2030 as population rises, people per household decline and fridge ownership approaches Chinese levels, India might have 400 million fridges.

So Mr Chowdhury’s purchase and others following, will mean that India needs to produce more fridges – lots more. In 2000 China was producing 13 million refrigerators per annum, but by 2010 this had jumped to 73 million. This means India needs more refrigerator factories and chemical plants to make the refrigerant. The refrigerators might be made of steel and aluminium which means mining or the import of ores, refining, smelting, casting, stamping and transport. All of these need coal, gas and oil. Coal in particular is needed for smelting iron ore as it acts as the reducing agent, producing carbon dioxide in the process. The intense heat required in the processes is most easily and economically provided by coal or gas, although given time electricity will doubtless make its way into these processes.

Oil will be needed as a transport fuel to ship all these materials from mines to refineries to manufacturing plants to distribution depots, then wholesalers, shops and finally Mr Chowdhury’s home. Although electricity is starting to appear in the transport sector for lighter vehicles, with the exception of railways it isn’t the energy provider yet for heavy transport. In India, rail transport is extensive and electrification is making good progress, but there is still much to be done.

With a refrigerator in the house, the BBC reports that family life for Mr Chowdhury will change. It will be easier, so his productivity in other areas may well rise. This could translate to more income, further purchases and perhaps the first opportunity for air travel in the years to come. That will certainly be powered by Jet A1.

There is no doubt that India is industrialising rapidly and Prime Minister Modi should be commended for his ambitious goal of 100 GW of solar capacity by 2020 and speeding up the nuclear programme, but this won’t stop carbon dioxide emissions from rising sharply in the near term; it is more a question of how high they rise and the more immediate actions that can be taken. I am reminded again of a tender call for 8GW of coal fired capacity in India that appeared in the Economist a while back. This is just one project of many.

India coal

Coming back to the discussions between Mr Obama and Mr Modi, it is clear to me that India faces a huge challenge, which should also be recognised as a global challenge to help them and others make a different set of energy choices. The start with solar is important but it may not be enough to keep coal emissions down in the medium term. So here are three suggestions from me to take India forward;

  1. Develop low cost village scale energy storage to support solar. This could also position India as a key supplier to Africa in the decades to come.
  2. In the short term,  favour natural gas over coal for electricity generation. This would make a real difference to power sector emissions and would help India bypass the severe air quality issues now being faced in China. It would also avoid the cost of retro fits later on.
  3. For the longer term, particularly for industry but also power generation, the real game changer could be carbon capture and storage. This is where more international focus is needed, especially in the development of funding mechanisms to support its deployment in developing countries.

With the choice of a high road and a low road from Lima to Paris, the Parties seem to have selected the dirt track off to the side, replete with rocks, obstacles, difficult terrain and an uncertain destination. However, the map they have crafted in Lima, while full of options and dead ends, does at least have some clear pointers to the outcome that is actually needed. The question is whether or not these are followed.

The Lima call for climate action turned out to be a hard won outcome, with the talks extending into Sunday morning as negotiators struggled to reach agreement over one issue in particular that has dogged the process since its very beginnings in 1992 – the respective roles of developed and developing countries. Many commentators believed that the negotiations in Durban in 2011 had, at least to some extent, relegated this issue to the history books.

In particular, Professor Robert Stavins of the Harvard Kennedy School in Boston, said in his 2011 report on Durban;

It focuses instead on the (admittedly non-binding) pledge to create a system of greenhouse gas reductions including all Parties (that is, all key countries) by 2015 that will come into force (after ratification) by 2020. Nowhere in the text of the decision will one find phrases such as “Annex I,” “common but differentiated responsibilities,” or “distributional equity,” which have – in recent years – become code words for targets for the richest countries and a blank check for all others.

In the aftermath of Lima, the flavour of differentiation has reappeared and even some of the words. The call for climate action now incorporates a clear reference to “common but differentiated responsibilities“, albeit with the addition taglines of “respective capabilities” and “in light of different national circumstances“. Professor Stavins was quick off the mark with an assessment of Lima, but still maintained that the intent of Durban remained;

. . . . the fact remains that a new way forward has been established in which all countries participate and which therefore holds promise of meaningful global action to address the threat of climate change.

It is difficult to agree with this given the recent negotiations. By contrast, Jonathan Grant of PWC referred to the final day of Lima as “trench warfare mentality”. While it is certainly the case that all countries are still required to submit INDCs of some description, the allowable range of options and structure to pick from has broadened considerably. Notably, Parties “may include” details such as quantifiable information and time frames, rather than the previous wording of “shall include”.

Adaptation planning is strengthened considerably, with this subject now highlighted in the opening lines of the Lima text and also referenced clearly in the context of INDCs. For developed countries this probably has little meaning in terms of their own actions, but for a number of developing countries this could be interpreted as a call for additional financial assistance from developed countries simply to build national infrastructure. The Loss and Damage issue also resurfaced with specific mention in the Lima text. These two apparent concessions may turn out to be a high price to pay for retaining some semblance of the Durban mitigation philosophy.

The intensity with which the developed / developing country issue erupted in the last hours of the Lima COP raises valid questions about the negotiations over the coming year. Leaving this particular issue still looking for a solution in Paris itself may be a burden too great for those final days, but it could also be that no matter how much effort is put into solving it in the interim, it will nevertheless emerge again in the last hours in 12 months time simply because negotiations tend to do things like this.

Looking more positively at the Lima call for climate action, the 40 page annex, “Elements for a draft negotiating text“, throws up some interesting tidbits but also a host of negotiating options which will need to be resolved. Two tidbits of note are;

  1. The mention of carbon pricing in the text; “Acknowledging that carbon pricing is a key approach for cost-effectiveness of the cuts in global greenhouse gas emissions.
  2. The reference on several occasions of an end-goal of net-zero anthropogenic emissions; “Also recognizing that scenarios consistent with a likely chance of holding the global average temperature increase to below 2 °C relative to pre-industrial levels include substantial cuts in anthropogenic greenhouse gas emissions by mid-century and net emission levels near zero gigatonnes of carbon dioxide equivalent or below in 2100.

The carbon pricing mention is almost certainly the result of the recent tireless work of the World Bank in getting this critical subject back on the global agenda, but the reference is rather empty in that no strong follow-up text supports it. Rather, there are several vague references to the use of markets and mechanisms.

The “net zero” reference though is quite bold, in that even if this century sees a sharp reduction is emissions, a net zero goal is much more challenging. Residual emissions from agriculture, industrial processes, land use changes and some level of direct fossil fuel use will likely remain well into the 22nd century if not beyond that, which means at a minimum some large scale application of carbon capture and storage at some point in the future.

There was much more to Lima than just the last hours of tense standoff politics, but that is what the world will likely focus on in the coming days. The draft negotiating text sets out some clear options for the future, although if the weakest of these is picked in every instance the end result will have hardly been worth the effort. However, there is also text there that doesn’t have options, so that may well see the light of day in Paris. This is the case for some of the “net zero emissions” wording and also the need for Parties to “develop low emission strategies” and “maintain commitments / contributions / actions at all times“.

As such, there remain a few reasons to be hopeful.

Did the UN Summit shift the dial?

The UN Climate Summit has come and gone and leaders from many countries have made announcements, pledges or at least offered moral support. But are we any better off as a result? Reflecting on the last few days of meetings, events, panels and speeches in New York, I would have to argue for the “yes” case. As such, it contributes another piece to the Paris jigsaw.

UN Climate Summit Jigsaw

Although nothing that was formally pledged or offered is likely to make a tangible difference to global emissions in the medium term, one subject has resurfaced in a major way that can: carbon pricing. While there was still a focus on efficiency and renewable energy at many events, the need to implement policy to put a price on carbon dioxide emissions came through loud and clear. In recent months this has been led by the World Bank and they were able to announce in New York that 73 countries and some 1000 companies have signed their Statement, Putting a Price on Carbon, which is an extraordinary result for just a few months of concerted effort.

Given that this was a UN event rather than a national event, the focus naturally shifted to the global story, with an emphasis on how the Paris 2015 agreement might accelerate the shift to carbon pricing and a carbon market that operated globally. The International Emissions Trading Association (IETA) held a number of events around the city outlining its ideas on how this might happen.

Its kickoff was an event on Monday afternoon, the day before the Summit, where a team led by Professor Rob Stavins of the John F. Kennedy School of Government at Harvard University presented new work on linking various carbon emission mitigation approaches. The work suggests that such linkage could be the foundation mechanism behind a globally networked carbon market and can be found in summary here. It illustrates how even quite different approaches to mitigation might link and then deliver the economic benefits associated with a larger more liquid market.

But if this approach is to be adopted, the big question that would still need to be addressed is how the Paris agreement might actually facilitate it. IETA offered some thinking on is, with an outline proposal that even included some basic treaty text to enable such a process. Given that the 2015 agreement will almost certainly be structured around INDCs, or Intended Nationally Determined Contributions, the text proposal needed to embrace this concept and work with it, rather than attempting to impose a carbon price or carbon market structure by diktat. The basic reason for trading in a market is to exchange goods or services and optimise revenue and / or lower costs as a result, so the text simply suggested that parties (nations) could be offered the ability to exchange and transfer mitigation effort (INDCs) should they (or companies within their economies) wish to do so, but requires that it be recorded in some form of carbon reduction unit. The proposal by IETA is as follows;

Cooperation between Parties in realizing their Contribution

  1. Parties may voluntarily cooperate in achieving their mitigation contributions.
  2. A unified international transfer system is hereby established.

a.  A Party may transfer portions of its defined national contribution to one or more other Parties through carbon units of its choice.
b.  Transfers and receipts of units shall be recorded in equivalent carbon reduction terms.

There could be many variations on this theme, but the idea is to establish the ability to trade and require a carbon unit accounting of it if and when it takes place. Of course many COP decisions will be required in years to come to fully flush this out.

What was interesting about this proposal was the reaction it got from those closer to the negotiating process. Rather than simply acknowledging it, one meeting in New York saw several people debating the wording as if the formal negotiation was underway. I understand that this was exactly the reaction IETA were looking for and hopefully it bodes well for the development of market mechanisms within the Paris outcome.

There were of course other themes running through the various events. The new business coalition, We Mean Business, was actively marketing its new report which attempts to make the case that emission reduction strategies in the business sector can deliver returns on investment approaching 30%. This is a rather misleading claim in that it is primarily focussing on efficiency improvements in certain sectors, which of course factors in the local cost of energy, but particularly electricity. There is no doubt that reducing electricity consumption can lead to improved competitiveness and growth, hence a very attractive ROI, but this is very different to a real reduction in emissions that actually delivers benefits globally. This is a major theme of my recent book. The problem with such claims is that they shift attention away from the much more difficult task of actually reducing emissions to the extent that cumulative atmospheric carbon dioxide is impacted; such reductions require real heavy lifting as delivered through the use of carbon capture and storage.

Overall, It was an interesting week, framed by 300,000 demonstrators on Sunday and a plethora of world leaders speaking at the UN on Tuesday. Just maybe, this was the start of something meaningful.

A huge turnout in New York

I am in New York for Climate Week, which includes the UN Climate Summit on Tuesday. Sunday saw an enormous turnout for the People’s Climate March as can be seen from a few of my pictures below.

Climate march 1 (small)

Climate march 2 (small)

Climate march 3 (small)

Climate march 4 (small)

Climate march 5 (small)

Climate march 6 (small)

Climate march 7 (small)

Climate march 8 (small)

Climate march 9 (small)

Climate march 10 (small)

Energy reality meets Climate Reality

In its enthusiasm to spread the word about the rapid uptake of renewable sources of energy, the Climate Reality Project recently circulated the picture below. It references the amount of wind energy, in particular, that is now being generated in the German State of Schleswig-Holstein.

Climate Reality Renewable Energy

This is Germany’s northernmost state and borders both the North Sea and the Baltic, so benefits from the windy climate that this geography offers. It is well known as Germany’s windiest area


In recent years and as part of the overall push to generate more renewable energy in Germany, considerable wind energy capacity has been installed in this region. While the current level of generation from wind is laudable, this is far from 100% renewable energy. The actual milestone that the state has reached was more accurately described as follows;

The Northern German coastal State of Schleswig-Holstein will be able to mathematically meet its electricity demand fully with renewable energy sources this year if wind yields reach at least average levels, Robert Habeck, Minister of Energy said when presenting a new study last week (May 2014).

This means that the amount of wind (and solar) electricity generated in Schleswig-Holstein will be equal to total demand, but these may not match in terms of timing. At certain times the state will export surplus wind generated electricity into the grid and at other times it will need to draw from the grid to meet its needs, particularly during periods of little wind. Nevertheless, it is quite an achievement, even though it highlights the need for a substantial backup system for renewable electricity generation.

But there is a second major reality associated with “100% renewable energy” statements. We live in a global economy that is only partly powered by electricity, to the extent that even if this electricity is generated entirely from renewable sources, the percentage of renewable energy in the final energy mix will still be less than 20% (see below). Even in OECD countries where electricity is more widely used, this only rises by a few percentage points.

Global final energy 2011

The largest slice of final energy (i.e. energy that is used by the final consumer for the delivery of an energy service, e.g. mobility) is oil, used mainly for mobility in road vehicles, planes, trains and ships. Natural gas and coal are also very large, used primarily for industrial processes such as steel making, chemical plants and similar. Natural gas is also used extensively throughout the world as a residential fuel for boilers and direct home heating.

Coming back to Schleswig-Holstein, the actual percentage of renewable energy in the final mix is probably higher than most areas, not just because of its renewable electricity production but also because of the availability of biomass from the agricultural sector. In Germany as a whole, even if all the electricity was sourced from renewable energy (but it isn’t) and adding to this the biofuel and waste energy sources, a level of ~27% renewable energy would be reached. For Schleswig-Holstein with its current level of renewable generation, that probably translates to ~30% today.

That’s an impressive feat, but it isn’t 100%.

MIT takes a view on a new climate agreement

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In my most recent post outlining ten reasons why the global 2° C goal is more difficult than most commentators imagine, I referenced a new MIT report, Expectations for a New Climate Agreement, which looks at the prospects for the expected Paris COP21 agreement actually changing the current global emissions pathway. The findings don’t give a lot to be hopeful about, but nevertheless are worthy of further review.

The work has been carried out by the MIT Joint Program on the Science and Policy of Global Change, a unique coming together of disciplines ranging from atmospheric chemistry to macro-economics, all under one roof. The team has developed considerable modelling expertise, which also combines the aforementioned disciplines to allow policy feedback to impact emissions and therefore the climate model itself. For the sake of transparency, Shell is a sponsor of the Joint Program.

The first stumbling block the researchers hit in trying to assess what Paris might deliver was the current lack of detail or even a basic outline of the scope of the deal; this with just 15 months to go. While it is now widely assumed that COP21 will deliver a bottom up agreement based on contributions at a national level, there is almost no information available on accounting periods, review options, the nature of a contribution (e.g., reduction quantity, mitigation action, adaptation effort, financial aid, capacity building, technology transfer, R&D effort), terms of compliance, extension provisions and so on. Rather, all this had to be assumed, with the consequence of considerable uncertainty around the MIT findings. For example, MIT focus on a target date of 2030 for the first round of contributions, but continue the simulation of the effects of assumed contributions through to 2050.

A reference case is presented which sits within the RCP 8.5 range, the equivalent of atmospheric concentrations of CO2 exceeding 1000 ppm over the long term. This represents a 4+°C scenario by the end of the century.

Electricity generation is the single largest emitting sector in most countries and therefore features first in the resulting analysis. The MIT team argue that the majority of policy effects on emissions can be covered with just two options: controls on coal-fired generation and renewable energy mandates. In the case of coal, various regions and countries are assumed to pledge restrictions in coal generation, as outlined in the table below. Crucially though, large future users such as India are not expected to make a pledge of this type.

MIT Coal Assumptions

Renewable energy is also expected to grow strongly, with the EU reaching a 35% share in electricity generation by 2050, with other regions following, albeit not as aggressively.

MIT Renewable Portfolio Assumptions

In the transport sector, efficiency is the trend to watch, with vehicle efficiency improving by 2% per annum from 2020 in developed countries and by 1% per annum in the rest of the world. Similarly, in the commercial transport sector, a constant focus on efficiency in trucking fleets sees emissions between 10 and 20% lower than the reference case by 2050. However, the sector remains oil based for the entire period.

Efficiency is also the major driver in reducing household emissions from the reference case, with developed countries leading the way and achieving a 20% differential by 2050. However, for other parts of the world this falls to as low as a 5% improvement over 30 years.

Significant improvements are also assumed for land use change emissions and methane emissions.

The effect of all this is noticeable, but growth in global emissions still continues through to 2050, although at a slower pace than the reference scenario. MIT have 2050 CO2-eq emissions at about 71 Gt, vs. their estimate of 56 Gt in the year of the agreement, i.e. 2015. This outcome is compared with two other projections in the figure below. One is the Reference case used throughout this analysis. Also shown, for comparison purposes, is their estimate of emissions to 2050 if commitments made in Copenhagen are met in 2020 and sustained thereafter. By this analysis, the expected contributions from current negotiations will bring the nations part way toward an RCP 4.5 pathway (a median global temperature increase of 1.8°C over this century or about 2.6°C above the pre-industrial level) but will also leave much to be done in subsequent efforts.

MIT Reductions

The issue of subsequent efforts and the nature of any review process is where the MIT analysis carries its starkest warning. The paper notes that if an agreement is reached in 2015, going into effect by 2020, the earliest review of performance along the way might not be before 2025. In this case, an effort to formulate the next agreement under the Climate Convention, or a tightening of COP-21 agreements, would not start until 2025 or after, with new targets set for a decade or more after that. If this expectation is correct, then global emissions as far out as 2045 or 2050 will be heavily influenced by achievements in the negotiations over the next 18 months.

Finally, the analysis calls for a common pricing regime as a preference to individual national actions conducted in isolation. The benefit here is a simple one, a lower overall cost for the global economy. Alternatively, for the same cost, greater ambition could be realized.

Based on the MIT work it would appear that negotiators and their national governments still have a long way to go to be able to say that they have a deal and set of actions that is effectively dealing with anthropogenic warming of the climate system.

A recent story in The Guardian expressed some optimism that “humans will rise to the challenge of climate change”. Ten reasons were given to be hopeful, but not one of them mentioned the climate basics such as a carbon price or carbon capture and storage. Rather, the offerings were largely tangential to the reality of rising CO2 emissions, with the hope that because European homes are using less energy and solar prices are dropping, then ipso facto, atmospheric CO2 levels would somehow stabilize (i.e. annual CO2 emissions falling to zero).  Without wanting to be pessimistic, but rather realistic, it may not be the case that emissions just fall and here are ten reasons why not. For those who visit this blog more regularly, sorry for the repetition, but hopefully this is a useful summary anyway.

1. There is still no carbon price

Although discussions about carbon pricing are widespread and there are large systems in place in the EU and California, pervasive robust pricing will take decades to implement if the current pace is maintained. Yet carbon pricing is pivotal to resolving the issue, as discussed here. The recent Carbon Pricing Statement from the World Bank also makes this point and calls on governments, amongst others, to work towards the goal of a global approach.

2. Legacy infrastructure almost gets us there

The legacy energy system that currently powers the world is built and will more than likely continue to run, with some parts for decades. This includes everything from domestic appliances to cars to huge chemical plants, coal mines and power stations. I have added up what I think is the minimum realistic impact of this legacy and it takes us to something over 800 billion tonnes carbon emitted to the atmosphere, from the current level of about 580 billion tonnes since 1750. Remember that 2°C is roughly equivalent to one trillion tonnes of carbon.

3. Efficiency drives growth and energy use, not the reverse

The proposition that energy efficiency reduces emissions seems to ignore the cumulative nature of carbon emissions and is apparently based on the notion that energy efficiency is somehow separate to growth and economic activity. What is wrong with this is that the counterfactual, i.e. that the economy would have used more energy but grown by the same amount, probably doesn’t exist. Rather, had efficiency measures not been taken then growth would have been lower and energy consumption would have been less as a result. Because efficiency drives economic growth, you have to account for Jevons Paradox (rebound). After all, economies have been getting more efficient since the start of the industrial revolution and emissions have only risen. Why would we now think that being even more efficient would somehow throw this engine into reverse?

4. We still need a global industrial system

In a modern city such as London, surrounded by towns and idyllic countryside with hardly a factory in sight, it’s easy to forget that an industrial behemoth lurks around the corner producing everything we buy, eat, use and trade. This behemoth runs on fossil fuels, both for the energy it needs and the feedstock it requires.

5. Solar optimism

There’s little doubt that solar PV is here to stay, will be very big and will probably be cheap, even with the necessary storage or backup priced in. But it’s going to take a while, perhaps most of this century for that to happen. During that time a great deal of energy will be needed for the global economy and it will come from fossil fuels. We will need to deal with the emissions from this.

6. Developing countries need coal to industrialize

I talked about this in a very recent post – developing countries are likely to employ coal to industrialize, which then locks the economy into this fuel. One way to avoid this is to see much wider use of instruments such as the Clean Development Mechanism, but at prices that make some sense. This then comes back to point 1 above.

7. We focus on what we can do, but that doesn’t mean it’s the best thing to do

Methane emissions are currently attracting a great deal of attention. But cutting methane today and not making similar reductions in CO2 as well means we could still end up at the same level of peak warming later this century. It’s important to cut methane emissions, but not as a proxy for acting on CO2.

8. It’s about cumulative carbon, not emissions in 2050

Much of the misconception about how to solve the climate issue stems from a lack of knowledge about the issue itself. CO2 emissions are talked about on a local basis as we might talk about city air pollution or sulphur emissions from a power plant. These are flow problems in that the issue is solved by reducing the local flow of the pollutant. By contrast, the release of carbon to the atmosphere is a stock problem and the eventual stock in the atmosphere is linked more to the economics of resource extraction rather than it is to local actions in cities and homes. Thinking about the problem from the stock perspective changes the nature of the solution and the approach. One technology in particular becomes pivotal to the issue, carbon capture and storage (CCS).

9. Don’t mention CCS, we’re talking about climate change

Following on from the point above, it’s proving difficult for CCS to gain traction and acceptance. This is not helped by the UN process itself, where CCS doesn’t get much air time. One example was the Abu Dhabi Ascent, a pre-meeting for the upcoming UN Climate Summit. CCS wasn’t even on the agenda.

10. We just aren’t trying hard enough

A new report out from the MIT Joint Program on the Science and Policy of Global Change argues that the expected global agreement on climate change coming from the Paris COP21 in 2015 is unlikely to deliver anything close to a 2°C solution. At best, they see the “contributions” process that is now underway as usefully bending the global trajectory.

The analysis shows that an agreement likely achievable at COP-21 will succeed in a useful bending the curve of global emissions. The likely agreement will not, however, produce global emissions within the window of paths to 2050 that are consistent with frequently proposed climate goals, raising questions about follow-up steps in the development of a climate regime.

Perhaps of even greater concern is the potential that the UNFCCC process has for creating lock-in to a less than adequate policy regime. They note:

Nevertheless, if an agreement is reached in 2015, going into effect by 2020, the earliest review of performance along the way might not be before 2025. In this case, an effort to formulate the next agreement under the Climate Convention, or a tightening of COP-21 agreements, would not start until 2025 or after, with new targets set for a decade or more after that. If this expectation is correct, then global emissions as far out as 2045 or 2050 will be heavily influenced by achievements in the negotiations over the next 18 months.



While all fossil fuels are contributing to the accumulation of carbon dioxide in the atmosphere, coal stands apart as really problematic, not just because of its CO2 emissions today (see chart, global emissions in millions of tonnes CO2 vs. time), but because of the vast reserves waiting to be used and the tendency for an emerging economy to lock its energy system into it.

Global energy emissions

Global emissions, million tonnes CO2 from 1971 to 2010

I recently came across data relating to the potential coal resource base in just one country, Botswana, which is estimated at some 200 billion tonnes. Current recoverable reserves are of course a fraction of this amount, but just for some perspective, 200 billion tonnes of coal once used would add well over 100 billion tonnes of carbon to the atmosphere and therefore shift the cumulative total from the current 580 billion tonnes carbon to nearly 700 billion tonnes carbon; and that is just from Botswana. Fortunately Botswana has quite a small population and a relatively high GDP per capita so it is unlikely to use vast amounts of this coal for itself, but its emerging neighbours, countries like Zimbabwe, may certainly benefit. This much coal would also take a very long time to extract – even on a global basis it represents over 25 years of use at current levels of production.

This raises the question of whether a country can develop without an accessible resource base of some description, but particularly an energy resource base. A few have done so, notably Japan and perhaps the Netherlands, but many economies have developed by themselves on the back of coal or developed when others arrived and extracted more difficult resources for them, notably oil, gas and minerals. The coal examples are numerous, but start with the likes of Germany, Great Britain, the United States and Australia and include more recent examples such as China, South Africa and India. Of course strong governance and institutional capacity are also required to ensure widespread societal benefit as the resource is extracted.

Coal is a relatively easy resource to tap into and make use of. It requires little technology to get going but offers a great deal, such as electricity, railways (in the early days), heating, industry and very importantly, smelting (e.g. steel making). In the case of Great Britain and the United States coal provided the impetus for the Industrial Revolution. In the case of the latter, very easy to access oil soon followed and mobility flourished, which added enormously to the development of the continent.

But the legacy that this leaves, apart from a wealthy society, is a lock-in of the resource on which the society was built. So much infrastructure is constructed on the back of the resource that it becomes almost impossible to replace or do without, particularly if the resource is still providing value.

As developing economies emerge they too look at resources such as coal. Although natural gas is cleaner and may offer many environmental benefits over coal (including lower CO2 emissions), it requires a much higher level of infrastructure and technology to access and use, so it may not be a natural starting point. It often comes later, but in many instances it has been as well as the coal rather than instead of it. Even in the USA, the recent natural gas boom has not displaced its energy equivalent in coal extraction, rather some of the coal has shifted to the export market.

Enter the Clean Development Mechanism (CDM). The idea here was to jump the coal era and move directly to cleaner fuels or renewable energy by providing the value that the coal would have delivered as a subsidy for more advanced infrastructure. But it hasn’t quite worked that way. With limited buyers of CERs (Certified Emission Reduction units) and therefore limited provision of the necessary subsidy, the focus shifted to smaller scale projects such as rural electricity provision. These are laudable projects, but this doesn’t represent the necessary investment in large scale industrial infrastructure that the country actually needs to develop. Rooftop solar PV won’t build roads, bridges and hospitals or run steel mills and cement plants. So the economy turns to coal anyway.

This is one of the puzzles that will need to be solved for a Paris 2015 agreement to actually start to make a difference. If we can rescue a mechanism such as the CDM and have it feature in a future international agreement, it’s focus, or at least a major part of it, has to shift from small scale development projects to large scale industrial and power generation projects, but still with an emphasis on least developed economies where coal lock-in has yet to occur or is just starting.