A recent article posted on the GreenMoney e-jounal site argues that society is moving rapidly into a period of structural (and possibly abrupt) decline in fossil fuel use. The story, like many which argue along similar lines, draws on the current upward trend in renewable electricity deployment, noting that “Renewable energies have become too economically competitive for fossil fuels to contend with . . . “.
While this may be true at the margin when generating electricity, what does it mean for the energy system as a whole? Oil, gas and coal make up 80% of primary energy use (Source: IEA World Balance 2013), although it is often argued that this isn’t a representative picture as a significant percentage of the energy in fossil fuels is wasted as heat loss in power plants, which wouldn’t be the case for a technology such as solar PV. However, moving past primary energy and looking instead at final energy (i.e. the energy which we use to generate energy services such as mobility – so gasoline is a final energy whereas crude oil is primary energy) we see that oil products, natural gas and fuels such as metallurgical coal still make up two thirds of energy use, with electricity and heat comprising just over 20% of the mix. The balance is biofuels (comprising liquid fuels and direct use of biomass) and waste (IEA Sankey Chart for 2013).
Today electricity is generated primarily from coal and natural gas, with nuclear and hydroelectricity making up most of the difference. In 2014 the world generated 23,536 TWhrs of electricity, of which wind was 706 TWhrs (3%) and solar 185 TWhrs (<1%). Wind grew at 10% and solar at nearly 40% compared to the previous year (Source: BP Statistical Review of World Energy). This contrasts with an overall growth in electricity generation of 1.5% per annum. It is certainly possible to imagine a world in which solar and wind grow to dominate electricity production, but then we also need to imagine a world in which electricity grows to become the dominant final energy for renewables to dominate the energy system overall.
This is one of the key subjects that is dealt with in a recent Shell publication that I have worked on during this year; A Better Life With a Healthy Planet – Pathways to Net-Zero Emissions. For me, the most telling outcome of the scenario analysis and energy system modelling work behind the publication was that even in the latter part of the century when a net-zero carbon dioxide emissions state might be reached, electricity still only makes up ~50% of final energy. This means that 50% of final energy is something else!
The scenario presented shows a world that still requires several types of final energy to meet its needs. For example, liquid hydrocarbons still dominate in shipping and aviation, even as road passenger transport is hardly serviced by hydrocarbons at all. For road freight transport, a three way split has emerged between electricity, hydrocarbons and hydrogen.
Industry remains a large user of thermal fuels throughout the century, with key processes such as cement, chemicals and metallurgical process all dependent on their use for the foreseeable future. Electrification makes significant inroads to other types of industry, but this is far from universal. Hydrogen is a potential thermal fuel of the future, but processes might have to be modified significantly to make use of it. For example, it is possible for hydrogen to act as the reducing agent in iron smelting, but today this is a pilot plant scale research project.
Even the manufacture of hydrogen might take two routes, with competition through efficiency and cost determining the eventual winner. The first is the conversion of natural gas to make hydrogen, with the resulting carbon dioxide captured and geologically stored. Alternatively, hydrogen can be produced by electrolysis of water with renewable energy providing the necessary electricity.
Of course the continued use of fossil fuels to meet the needs of hydrocarbons in transport, industry and even power generation means extensive deployment of carbon capture and storage (CCS).
Meeting the aim of the Paris Agreement and achieving a balance between anthropogenic emission sources and sinks (i.e. net zero emissions) is a complex challenge and not one that can necessarily be serviced by wind and solar, or for that matter electricity, alone. Rather, we potentially end up with a more diverse energy system, much larger in scale than today, with a set of new processes (CCS), new industries (hydrogen based) and new sources (solar PV).
