Category: Low carbon economy

Electric vehicles and 2030

dchone December 7, 2020

Over a decade ago in one of my very first posts in this blog, I responded to what appeared to be a working assumption in government that there would be between 1 and 2 million electric cars on the road in the UK by 2020. It was hard to imagine that this would be the case and harder to calculate a pathway that would deliver such an outcome. I noted at the time that after a dozen years and some significant stimulus, the number of hybrid vehicles on UK roads had risen to 300,000. So here we are in late 2020 and the number of battery electric vehicles on the road in the UK is around 200,000. There are plug-in hybrids in addition to this, roughly doubling the total population of plug-in vehicles to just under 400,000.

In recent weeks the UK government has significantly stepped up its ambition regarding passenger electric vehicle deployment, with a decision to ban the sale of internal combustion engine vehicles in 2030, albeit with some relaxation to 2035 for plug-in hybrid vehicles. The announcement prompted me to look back at the decade old post and to look at how the numbers stack up this time around.

With a population of some 67 million people, the UK has about 33 million cars or just under one car for every two people. This ratio has been rising slowly over the past few years, even as new car sales have edged downwards so we might expect something like 37 million cars in the UK fleet by 2030 for a population of 70 million. Assuming there isn’t a mad rush for internal combustion engine vehicles (ICE) in the years just prior to 2030, then in 2030 we could see some 2.6 million cars sold; more than in 2019 but only reaching the levels seen in 2015 and 2016 despite having 15-20% more cars on the road in total.

This means that in 2030, 2.6 million cars with a battery must be available for UK buyers. They could be pure battery electric (BEV) or plug-in hybrid (PHEV). While the PHEVs are popular today, will that still be the case in 2030? It could be that manufacturers are already abandoning that class of vehicle to simplify production lines, with a focus on ICE production for legacy markets and BEV production for the future. After all, there would be no place for the PHEV in the UK after 2035.

The UK buys about 3.5 – 4.0 % of global passenger vehicle production, so the purchase of 2.6 million vehicles would notionally require 70 million BEVs in production globally, or all passenger vehicle production. However, with a leading policy position on BEV uptake and local vehicle production of some 1.3 million vehicles per annum, the UK could be commanding a relatively higher percentage of the BEV market. This has been the case in Norway in recent years. Of course, other jurisdictions are also declaring earlier dates for the BEV transition, so there could be competition for the available vehicles. But let’s assume the UK can command 8% of BEV production in 2030, which would imply the need for global BEV production of 35 million vehicles in 2030.

Current global BEV production is 2-2.5 million per year, or 3.2% of total passenger vehicle production. That will need to grow by a factor of at least fifteen in ten years for the UK to meet its goal. If there is a limitation in the supply chain for BEVs it is most likely to be the battery. It won’t be the car body, wheels, suspension, electronics, steering system or even the motor (but it is a very different component to ICE) as the capacity for these exists today in one form or another. But large scale Li-Ion battery production is a new and growing industry that requires new supply chains, new sources of critical minerals like cobalt and new processing facilities to make compounds such as lithium hexafluorophosphate.

Cobalt supply might be challenging as most global production comes from one country, the Democratic Republic of the Congo. It is an important component of Li-Ion battery chemistry although battery manufacturers are taking steps to minimize the requirement. Early battery cathodes contained nickel, manganese and cobalt in equal proportions, but companies such as LG Chem are close to producing cathodes with 80% nickel and only 10% cobalt. Tesla’s first Model S, launched in 2012, was built with an average of 11 kg of cobalt per vehicle, but according to Benchmark Minerals that was down to about 4.5 kg in its successor car, the Model 3, which launched in 2018. Nevertheless, if production were to hit 35 million vehicles in 2030 and each vehicle required 5 kg of cobalt, that still amounts to 175,000 tonnes of cobalt. Current global cobalt production capacity is 150,000 tonnes but it is a widely used mineral.

BEVs aren’t the only products competing for Li-Ion batteries. By 2030 we should be seeing a variety of haulage trucks in the market, more electric buses, a continued escalation of consumer devices running on batteries and a surge in demand for grid scale battery packs to help manage renewable intermittency. While battery recycling will be a large industry in the decades ahead, this won’t be the case in 2030 as society will only just be starting the recycle the batteries being produced today, which represent a tiny fraction of 2030s demand.

Other factors will also come into play, but the size of the battery in every car will be important. Early BEV models were relatively small with limited range and had battery storage of around 25 kWh – the Nissan Leaf is a good example. That’s because batteries were very expensive. Today with battery prices falling rapidly, one Nissan variant known as the Leaf e+ has a 62 kWh battery pack. A review of multiple models from several manufacturers shows battery sizes heading towards 75-100 kWh. So let’s assume the average 2030 car has an 80 kWh battery with a range of around 500 kms.

Global Li-Ion battery manufacturing capacity today is around 400 GWh, or enough to make 6 million BEVs with a 62 kWh battery onboard. However, half that capacity is being split between consumer electronics, larger vehicles such as electric buses and home or grid energy storage. In the 2030 world of 80 kWh battery packs and production of at least 35 million vehicles, nearly 3 TWh of battery manufacturing capacity will be needed just for the BEVs. That might mean 5 TWh in total to cater for all the other applications. And therein lies the potential issue.

There is no doubt that battery manufacturing capacity is ramping up rapidly, but where might we be in 2030? A recent analysis by Wood Mackenzie looks at the current project pipeline for new manufacturing facilities and expects a quadrupling to 1.3 TWh by 2030. The same article that discusses the analysis also notes that this is not the most bullish forecast. Bloomberg New Energy Finance expects 1 TWh of battery production capacity by 2025, while Benchmark Minerals expects 1 TWh of capacity by 2022/2023, 1.35 TWh by 2025, and 2.5 TWh by 2030, with China’s CATL accounting for 332 GWh and Tesla, the fourth-largest producer, with 148 GWh of capacity in 2030. Based on current forecasts, nobody is expecting 5 TWh of capacity by 2030, although it is also fair to say that few in 2010 expected solar PV manufacturing capacity to be 160 GW per year by 2020.

So the bottom line for the UK government and its ambitious plans means that not only must the UK command an outsize proportion of the BEV market, but that Li-Ion battery production is at least double the most ambitious current estimates for 2030.

Finally, assuming the needed rapid growth in BEV sales takes place and the UK reaches 100% sales by 2030, the number of vehicles on the road in that year would still be less than 10 million, out of a total of perhaps 37 million. It will take another decade or more beyond 2030 to turn over the whole fleet, which makes the recently announced 2030 goal of a 68% reduction against 1990 all the more difficult.

Aviation futures

dchone February 18, 2020

The aviation industry accounts for nearly one billion tonnes of carbon dioxide emissions annually against a global total in excess of 40 billion tonnes, which means it is around 2.5% of total emissions. However it is a high growth sector without obvious alternative energy carriers, implying that as other emissions fall and aviation continues to rise, its fraction of the total increases rapidly. Should global emissions fall by 50% in the same time that aviation doubles, then that fraction becomes ten percent.

Perhaps for the reasons given above, there is a particular focus on aviation emissions, far more so than a sector such as steel where emissions are currently much higher and will likely continue to be for many years. Additionally and unlike sectors such as steel and cement which are seen as essential elements for the provision of basic services such as homes and clean water, some people view aviation as a luxury which isn’t entirely necessary for modern society, hence the calls for limiting air travel as a means of limiting emissions from the sector. I don’t see rationing as a realistic pathway forward; the ability to traverse the globe in under a day has become too valuable.

The aviation sector will need to find another way forward. The current focus is on sustainable aviation fuels, such as those made from waste and sustainably harvested biomass, or perhaps even synthetic hydrocarbon fuels derived from processes that chemically combine hydrogen (from electrolysis of water using renewable energy) and carbon dioxide (from direct air capture). This latter route is currently very costly given the state of the variety of technologies required and large scale use of biomass always raises questions around its origin, the overlap with agriculture for food and the emissions that might arise from land use to create the biomass. Nevertheless, both these routes are worth pursuing.

But what other options might exist for the industry in the decades ahead?

Apart from balancing the emissions from aviation with some form of atmospheric carbon dioxide removal (from growing trees to direct air capture and geological storage), other routes would have to involve a shift away from hydrocarbon based fuels.

One possibility that is currently gaining favour is the development of electric propulsion, with the plane using battery storage for the electricity. This is also problematic due to the very low energy density of batteries when compared to hydrocarbons, a subject I discussed in an earlier posting. Battery electric planes might emerge for very short haul flights (e.g. London City Airport to Rotterdam, a flight I take quite a few times each year), but it is improbable for longer haul travel due to weight constraints. Today, 80% of the aviation industry’s emissions come from passenger flights longer than 1,500km, which means that a long-haul alternative technology needs to emerge.

One possibility is to use hydrogen directly as a fuel, either in a fuel cell configuration which essentially means an electric plane, or in a jet turbine engine in the same way planes use fuel today. The latter route means that planes could still attain the speeds and altitude of current jets. Hydrogen is well suited to a gas turbine engine.

Hydrogen isn’t weight constrained as an energy carrier, but volume considerations may prove challenging. A new airframe shape would likely emerge as a result.

	Jet A-1	Current Li-Ion Battery	Emerging Li-Metal Batteries	Liquid Hydrogen
Energy MJ/kg	42.8	~0.7	~2	120
Energy MJ/litre	37.4	~2	~4	8

Today, the development of hydrogen for aviation appears limited, with the BBC reporting a decade ago that there was no future for the fuel, despite proof of concept. Cost seemed to be the major issue, but today the cost of renewable electricity has fallen sharply and electrolysis to produce hydrogen is seeing a resurgence of interest.

A trawl through various online resources reveals that hydrogen jet turbines have been demonstrated for over 60 years. The first such flight was a modified B-57 Canberra Bomber, with one jet engine powered by liquid hydrogen from a cryogenic wing suspended tank (shown below)

diagram-of-a-hydrogen-fuel-system-on-nacas-martin-b-57b-canberra-ce9f7f

Source: NASA

In the 1980s Tupolev modified a Tu-155 to act as a test vehicle for a variety of alternate fuels, which included liquid hydrogen. The Tu-155 first flew on 15 April 1988. It used hydrogen fuel and later liquified natural gas (LNG). It flew until the fall of the Soviet Union and is currently stored at Ramenskoye Airport near Zhukovskiy. The cryogenic tank was stored in the main fuselage of the plane, in part due to the volume constraint noted above.

TU-155-Liquid-Hydrogen-Aircraft-Design-Tupolev-2009

Source: Tupolev

In the mid to late 1950s Lockheed proposed a concept reconnaissance aircraft that operated on liquid hydrogen and a design was also proposed for a Lockheed L-1011 passenger plane some years later. This was in response to the oil shocks of the 1970s.

Source: Lockheed

Despite over sixty years of on-off development of hydrogen powered flight, hydrocarbon fuels remain the only energy carrier for commercial aviation. Today, the industry faces a long term challenge that may require it to revisit shelved technologies, applying new concepts and materials to the variety of issues that couldn’t be fully solved in the decades past. In the Sky Scenario, we imagine that the first hydrogen intercontinental flight takes place in the mid to late 2040s, with a new generation of planes entering service from about 2050. Even then, it takes decades more for this to become a mainstay within aviation, but then could well be the only technology of the 22^nd century. In the interim in Sky, biofuels and removal technologies (bioenergy with CCS in Sky or BECCS) are used to deliver a net-zero emissions aviation system.

In the shadow of Apollo

dchone August 2, 2019

The recent 50^th anniversary of the first moon landing brought with it many calls for an “Apollo Project” approach to address climate change. Such an approach is never defined in detail by those calling for it, but it presumably means marshaling government funds, establishing more energy research organisations and focusing all efforts on getting a handful of key energy technologies up and running in a short space of time.

There is no doubt that the Apollo programme was an amazing technical and engineering achievement, but is it the right recipe for success for dealing with the climate issue?

Behind the Apollo programme and the broader NASA effort in the 1960s was an immense research effort, which included a great deal of energy system research. After all, space flight is a voracious consumer of energy but storing energy and carrying energy for the journey is challenging. The 1960s saw significant NASA backed research into a technology that we now pin great hopes on for the 21^st century, solar PV. In both the USA and USSR solar was fitted to various space vehicles, starting with the Telstar communication satellite in 1962 and Soyuz 1 in 1967. The first orbiting space station, Skylab, was powered by solar PV in 1973.

Skylab (Source: NASA)

As the 1970s unfolded and oil price shocks hit the global energy system, interest in solar PV picked up. In 1977 the U.S. Department of Energy launched the Solar Energy Research Institute, which later becomes known as the National Renewable Energy Laboratory (NREL). By 1980 ARCO Solar became the first panel manufacturer to hit 1 MW of yearly production. Two years later, the solar company installed the first megawatt-scale solar project in California. Today solar PV is deploying rapidly with current global solar generation (including thermal) now at 600 TWh, which represents about 2% of global electricity generation, which in turn is about 20% of all final energy use (Source: BP Statisitical Review of World Energy). Solar generation increased by 29% from 2017 to 2018 but remains a minor part of the energy system despite an average growth rate over the last decade of around 50% per year.

But this development from first invention at Bell Labs in 1954 and first use in 1962 has taken over 65 years to scale to 2% of the electricity system, yet it was born out of the Apollo project. While solar may be entirely fit for purpose in space based systems, that still isn’t the case on earth, where the day-night cycle, seasons, latitude and weather all factor into its usefulness. A large scale (e.g. big city, >1 million people) generation system that can rely on solar PV for 100% of its energy doesn’t exist yet, although a smaller solar thermal system with molten salt storage now operates in Morocco.

Of course the most visible outcome of Apollo was the big step forward in manned space travel, with huge hopes as the 1960s came to a close of a golden age emerging. In his 1968 film 2001: a Space Odyssey, Stanley Kubrick imagined vast space stations, a Pan Am shuttle service and manned bases on the moon.

By 2012, with solar PV growing rapidly, not only had Pan Am long vanished, but the USA had no manned launch capacity given that the Space Shuttle programme was at an end. It would have been a brave futurist that made such a statement back in 1969. Rather, the USA currently relies on the launch capacity of Russia, using technology that has changed little since the 1960s. However, a new generation of advanced heavy lift rocketry is emerging from the private sector in the USA.

Nevertheless, the space programme and related government and private efforts within the USA in the 1960s contributed enormously to human technical progress, with the computing developments at the time giving rise to the internet revolution which shows every sign of being as trans-formative as the industrial revolution in the 1800s. That revolution could yet have a significant impact on the energy system, but such a change is not yet clear.

What is apparent from the Apollo programme is that big focused efforts do not necessarily give rise to expected outcomes, even if they achieve their short term goals. Such efforts can certainly be game changing, and Apollo was, but in areas not necessarily targeted in the first instance. The other key factor is that large scale change doesn’t come quickly, as has been the case with solar PV. From a climate change perspective, there simply isn’t the time to allow new technologies to germinate and grow on a 60+ year timeline.

All the above raises the question as to what type of approach is needed to deliver broad energy system change over the coming decades. The Sky Scenario, released by Shell in 2018, attempts to illustrate this. It highlights the need for change across multiple fronts, using technologies that largely exist today or at least have a clear line of sight and driven by a strong policy framework. Sky relies on six key factors, with an important underpinning licence for change from society. It requires;

The adoption of carbon-pricing mechanisms by governments globally over the 2020s,
A step-change in the efficiency of energy use leads to gains above historical trends.
The rate of electrification of final energy tripling, with global electricity generation reaching a level nearly five times today’s level.
New energy sources growing up to fifty-fold, with primary energy from renewables eclipsing fossil fuels in the 2050s.
Some 10,000 large carbon capture and storage facilities are built, compared to fewer than 50 in operation in 2020.
Net-zero deforestation by 2070. In addition, an area the size of Brazil being reforested offers the possibility of limiting warming to 1.5°C, the ultimate ambition of the Paris Agreement.

Embedded within this are perhaps multiple Apollo programmes, across many countries and sectors, also requiring some level of collaboration across national borders and utilising well-funded public-private-partnerships . Those programmes must cover all the key sectors and engage at every aspect of the technology cycle, but particularly the need to take technologies across the so-called ‘valley of death’ by ensuring sufficient early deployment to achieve significant cost reductions. This was done very effectively for solar PV within the German Energiewende over the last decade, although that programme relied on the rapid scale-up of PV-Cell manufacture in China.

The ‘Apollo programme’ for climate is global in nature and is illustrated below.

Note: Scenarios are not intended to be predictions of likely future events or outcomes and investors should not rely on them when making an investment decision with regard to Royal Dutch Shell plc securities. Please read the full cautionary note in http://www.shell.com/skyscenario.

Getting to net-zero emissions in the UK

dchone May 9, 2019

Last week the Climate Change Committee (CCC) in the UK released its much anticipated report which is recommending that the government revise its emissions goal to net-zero in 2050. The Committee notes that this is an appropriate UK contribution towards the global need of meeting the goals of the Paris Agreement. The recommendation also follows in the wake of the IPCC Special Report on 1.5°C, which identified 2050 as the year in which the global economy should attempt to reach net-zero emissions in order to limit warming to 1.5°C with a 66% probability.

The recommendation is a shift from the current UK target which would see the country reach an 80% reduction by 2050, in support of which the country is broadly on track to deliver the first 3 interim carbon budgets to 2022. However, as it looks past 2022 the CCC notes there is insufficient early development of some technologies for the heavy lifting ahead. Examples of this include carbon capture and storage (CCS) and hydrogen for a variety of uses.

Nevertheless, the state of technology development, deployment and availability has shifted since the time of the first UK target back in 2008. The cost of wind and solar has dropped significantly, offshore wind is now a viable proposition, many electric car models are available and while not in the UK, some 20 CCS facilities are now running in various parts of the world. All of the technologies required to do the job set out by the CCC are in plain sight, although a number still require significant UK development for deployment in this country. The CCC report is also very clear on this issue.

2050 is just over thirty years away and that same time period reflecting backwards marks the time that I first arrived in the UK with Shell. In the next 30 years the whole energy system will need to shift to achieve net-zero emissions, but how does that compare with the changes seen over the last 30 years. While two thirds of that period has not been covered by the Climate Change Act and its carbon budgets, all but three years have been covered by the UK ratification of the UN Framework Convention on Climate Change.

The Sankey diagrams below reflect the change over the period, although the most recent from the IEA are 2016, so they won’t show the last two years of renewable energy development.

Overall primary energy consumption has fallen, with the most visible change being the shift away from coal and towards natural gas in power generation. Both bioenergy and renewables have also added to the generation mix. Nuclear plays an important and steady base load function. Natural gas is now the dominant contributor to the current power generation sector and in the past year there have been periods where coal has not played a role at all. Back in 1989 coal made up most of the generating capacity. Oil demand within the UK has hardly changed over thirty years (slightly up) although production has halved.

As noted above, one feature that has surged since 2016 is the proportion of renewable energy in the generation mix. Recent figures from BEIS show that wind and solar have now exceeded nuclear on a quarterly basis.

In the final energy system, the changes are more nuanced. The overall share of electricity has moved from 16.7% of final energy to 20.4%, or a shift of 3.7% points in 27 years. The global rate of change is tracking at 2% points per decade, so the UK is well short of that pace of transition. A net zero emissions economy would likely need electricity to be the major component of final energy, say around 60%, so the UK rate of change will need to shift from 1.37% points per decade to around 11% points in each of the coming decades.

Transport hasn’t shifted at all in the past 30 years, with oil use in transport slightly increasing. Electricity is just starting to creep into this mix, but pure electric vehicles have reached only 0.7% (2018) of new car sales. Worryingly, the total number of petrol and diesel cars registered in the UK in 2018 was unchanged from 2013, a period which has seen the first major push to get consumers to go electric. Reaching net-zero emissions by 2050 will not just mean seeing all new purchases as electric, but seeing all new purchases from about 2035 onwards as electric. It can take up to 15 years to completely turn over the entire on-the-road fleet, although a future government could presumably accelerate this process with a buy-back-and-scrap scheme.

In the industrial sector, energy consumption has dropped by nearly a third, presumably through efficiency improvements as industrial output has hardly changed (see chart below). Importantly, electricity use has stayed largely the same. This means that the sector is gradually electrifying, although again the pace of change is below that required.
UK Industrial Production (1970-2019).

Then there are the tricky bits, where the UK has made only limited progress. The CCC notes that radical change is needed in home heating, including a shift to hydrogen and heat pumps, with support from much better home insulation. But residential natural gas use has marginally increased in 30 years, despite significant improvements in boiler efficiency and the use of electricity instead of gas for new apartment buildings. One highlight in this area is the recent milestone of one million homes now being supplied with biomethane.

The overall change in 30 years has been one of continually falling greenhouse gas emissions, with much of the gain coming from natural gas replacing coal and a fall in industrial energy use. While the impetus for change over the last 30 years was perhaps not as great as it is now, the overall shift is symptomatic of typical energy system dynamics; rapid adjustment has never been a feature, primarily due to the large capital stock involved. Outside the energy sector change over the same period has been dramatic. In 1989 there was no internet, no social media, hardly a mobile phone to be seen and televisions were defined more by their depth than their width. So can the UK reach these sorts of transition rates and achieve the goal of net-zero emissions by 2050?

In the power generation sector, zero emissions should be entirely achievable in that time frame. Renewables are surging and new nuclear capacity is now under construction (although even getting that started took a decade). Similarly, with the models on offer or on their way, passenger vehicles could be entirely electric and various cities across the UK have demonstrated that electric buses are now a viable option. But there is no real sign of change for heavy goods vehicles, shipping or aviation. Perhaps the biggest challenge sits with the use of natural gas in homes and industry. It is easy to use, clean, provides a very high heat load and is backed by extensive infrastructure. Hydrogen and electrification are potential pathways forward, but as noted the electrification rate of change has to shift by nearly an order of magnitude. For hydrogen there are promising signs of change with the government now funding a major programme on supply and conversion of existing facilities away from natural gas.

Finally, there is carbon capture and storage (CCS), which may be a simpler solution in many applications than attempting to dislodge natural gas. CCS in combination with direct air capture (still a nascent technology) may also be needed to balance out emissions in sectors such as aviation. Even the production of hydrogen may be easiest at scale from natural gas, which would then also require CCS. The UK has tried and tried again with CCS, but there is still no operational facility to show for all the efforts made. Yet the UK is both pipeline dense and geologically gifted in terms of storage potential, so deployment could proceed given the right incentives to begin.

The Climate Change Committee have put forward a bold recommendation, but it is not without immense challenge. It ought to be possible to achieve the 2050 goal of net-zero emissions, but it won’t happen without some significant nudging by the government in a number of key areas. Policy decisions over the coming five years may well set the scene for the next twenty, so there is everything to play for.

Powering remote activities

dchone March 28, 2019

Over the past three weeks I have been on a voyage from Cape Horn to the Cape of Good Hope, specifically Ushuaia to Cape Town. With good weather for most of the trip, we were fortunate to stop in the Falkland Islands, South Georgia and Tristan da Cunha (some pictures below). Each of these have communities ranging from a few people to two thousand in the case of Stanley and each has found its own solution to providing energy. Of course the other remote activity out here is the need of the ship itself which will have travelled for some 20 days without refuelling and carried 400 passengers and crew across the South Atlantic.

The Falkland Islands has the major settlement of Stanley, a couple of very small towns, a military garrison and numerous remote farms. The Islands have settled on wind power to displace diesel generators, achieving an average of 35-40% displacement and a peak of 54%. Rural wind power has also been a success for the remote farms. The next step is to look at the potential offered by modern energy storage technologies, although flywheels have been used since 2010 for some storage in association with the wind turbines. Given the geography and climate, neither solar or hydro have been a success, apart from some niche applications. But the Falkland Islanders also have a history of burning peat for heat, although this is in decline. Kerosine and diesel are the most common fuels used today.

South Georgia is completely different. Since 2008 South Georgia’s two settlements Grytviken and King Edward Point (KEP) have been powered by hydro electricity. On the slopes above Grytviken there is a dam, originally built by the whalers at the turn of the 20th century. The dam increased the capacity of Gull Lake to feed water to the first hydroelectric power plant in 1914. The electricity produced then was mainly used for lighting the whaling station. The plant was expanded in 1928 to reduce the station’s reliance on imported coal for steam to power the factory. The electricity produced was then used to power winches and other factory equipment. The new turbine house has been built just off the pathway from the settlement to Shackleton’s grave, with the only visible sign of it as a generating station being the small stream of water seemingly running from under the building and into the bay.

Tristan da Cunha has a single settlement of about 270 people and an export factory to process the fish and lobster that are caught around the island. Although much of the electricity system was replaced about a decade ago after a fire, an entirely diesel based system was rebuilt. In recent years some changes have taken place with the installation of a few home solar water heaters, saving on bottled LPG which is used to heat water in Tristan houses. A small solar farm was also constructed west of the fishing factory. It consists of 26 solar panels, aligned to face the northern midday sun and each capable of generating 250 watts, so a combined capacity of 6.5kW. The connection to Tristan’s electricity grid was made on 30th April 2015. There are further plans for change, but the logistics of getting equipment to Tristan is enormously challenging. The island can only be approached by sea and few ships stop there. As we discovered on a second stop there (to pick up a local government person so we could land on Inaccessible Island), weather can quickly close the port and conditions can persist for days. But the case for further change is strong, given the community dependency on the import of diesel fuel and LPG. The eventual solution for Tristan may be a combination of parts. Although there is excellent wind, it can be ferocious at times, bordering on hurricane conditions, which perhaps isn’t ideal for turbine operation. Solar can also be challenging, with thick cloud shrouding the island at times. And although there is ample rainfall, collecting this and channelling it through a hydro plant would also be very difficult given the geography.

This then brings the focus to the key dependency for all remote activities, the transport to get there and transport once there. As was the case for our vessel, all these locations are completely dependent on long distance, self-powered transport and that remains almost entirely powered by liquid fuels coming from petroleum. While renewables are starting to provide local energy solutions for remote activities, the energy for the transport associated with such activities has no immediate zero emission alternatives. Synthetic fuels, either from a biomass / biowaste starting point or formulated from hydrogen and carbon dioxide offer a simple drop-in possibility, but the bio-alternatives are still relatively small scale and the pure synthesis route is still at the pilot plant stage of development. It should be noted that large scale synthesis of fuels from hydrogen and carbon monoxide does exist, but the starting points are coal (SASOL in South Africa) or natural gas (Shell in Qatar). For a net-zero emission synthetic fuel, the hydrogen would need to be produced by electrolysis of water using renewable energy and the carbon extracted from the air as carbon dioxide.

Apart from synthetic fuels, the best prospect for change is perhaps hydrogen itself, in that there is good experience containing and carrying it and fuel cells can power even large motorised vessels such as ships. Nuclear exists on ships in the military, but after an attempt to demonstrate the feasibility of nuclear powered commercial ships in the 1960s, nothing more has come from this form of propulsion. The challenge will lie with the providers of heavy transport; shipping companies, airlines and aerospace companies and large road haulage entities. Perhaps like the remote activities themselves, different solutions will emerge over time for the various requirements faced. Some remote locations may even be well placed to provide hydrogen in that they could have an abundance of renewable electricity to put towards hydrogen production via electrolysis. Scotland’s Orkney Islands are starting to experiment with such a route forward, as recently reported by the BBC.

Albatross chick on West Falkland

King penguins on South Georgia

A king penguin colony on South Georgia

King penguins on South Georgia

Me on Tristan da Cunha

The worlds most remote inhabited island, Tristan da Cunha

Northern rockhopper penguins on Gough Island

Fur seal on Gough Island

Fur seals on Gough Island

Inaccessible Island

Birds returning in the evening to Nightingale Island

Has climate change run its course??

dchone June 14, 2018

A curious article appeared in the Wall Street Journal recently, written by Steven Hayward from the University of California, Berkeley, arguing that the climate change issue had run out of political steam.

The author notes early on;

A good indicator of why climate change as an issue is over can be found early in the text of the Paris Agreement. The “nonbinding” pact declares that climate action must include concern for “gender equality, empowerment of women, and intergenerational equity” as well as “the importance for some of the concept of ‘climate justice.’

Hayward claims that the descent into the abyss of social-justice identity politics represents the last gasp of a cause that has lost its vitality. But it’s hard to agree with this as a piece of evidence in favour of the argument. Climate change is a problem related to the global commons, so confronting it and finding a way forwards will always require the broadest range of actors and at least some consideration of all views. Further, the Paris Agreement itself doesn’t actually seek gender equality, it simply lays out what the Parties to the Agreement must do to manage emissions and adapt to change. The above references to gender equality come from the accompanying Decision text, in effect the preamble to the Agreement which sets out the context and provides instructions for implementation. Given the range of governments and interest groups involved in the Paris Agreement, it is hardly a surprise that inclusive language appears in the Decision text, but the Agreement text remains almost completely untouched by such wording.

The author also argues that ‘most national governments are backing away from forced-marched decarbonization’, a claim that is difficult to align with what can be observed in the world. Certainly, the intended actions set out by national governments fall short of the actions required to see global emissions immediately fall, but as each day passes small steps forward are being made, quite the opposite of backing away. Various carbon taxes, vehicle mandates, coal levies and assorted carbon related policies continue to emerge, albeit at levels not yet sufficient for major change, but nevertheless still being implemented. In the United States, a new tax credit has been legislated which will offer direct support for carbon capture and storage and may well result in substantial developments over the coming decade.

The author then states that the high cost of action will ultimately lead to the undoing of the issue, yet here again the evidence does not support the proposition. The cost of many of the energy technologies required over the coming decades has fallen dramatically, or is in the process of falling. Solar PV, offshore wind, batteries and even carbon capture and storage have all seen cost reductions, with some renewable power generation technologies now out-competing fossil energy systems. As recently as the publication of the Wall Street Journal article itself, a group involved in the development of air capture of carbon dioxide announced a steep fall in cost to as little $100 per tonne of CO2. While air capture remains a nascent technology, such articles and findings are becoming increasingly common across a broad range of mitigation technologies. Even for CO2 capture and storage technologies which will always be seen as an immediate cost to society, that cost over time will remain small when compared to the total cost of providing energy for the global economy.

Nevertheless, there may be one aspect of climate change that is over, although the author didn’t mention it in the article. Such is the change in energy technology costs over the past decade in combination with an underlying growth in low carbon and air quality related energy policies, that the potential extent of change in the climate itself could now be limited. In other words, the prospect of runaway change might have passed.

While the policy landscape is far from complete in terms of meeting the goals of the Paris Agreement, the IEA New Policies Scenario indicates that global emissions have little remaining upside before reaching a plateau. In the Shell Oceans scenario, which sees widespread adoption of solar as costs fall, a plateau in global emissions in the 2030s is followed by a gradual fall from 2040 to 2060, with an acceleration thereafter towards net-zero emissions shortly after 2100. While these scenarios do not encompass sufficient change to meet the goals of the Paris Agreement, they nevertheless indicate that energy system emissions could fall to very low levels simply through the combination of technology development and some policy implementation.

This has important implications for the climate system. Early scenarios published in the IPCC 3rd Assessment Report included cases such as the A1F1 and A2 scenarios, which saw CO2 emissions rise towards 100 Gt per annum late in the century, but with the more optimistic scenario (A1T) seeing a plateau and then slow fall in emissions that is similar to, albeit even a little above, what now looks very plausible. A1T sees a temperature rise of just over 2.5°C in 2100, with a range from several models of 1.8-3.3°C.

High fossil fuel use scenarios such as A1F1 and A2 led to the very real concern of not just 3-4+°C temperature rise by 2100, but conceivably 5-6+°C of temperature rise or possibly more, which in turn could result in changes in the climate that would be very difficult or even impossible to manage and adapt to. This in turn led to climate alarmism, which the author of the Wall Street Journal article compares to a continually blaring car alarm which people then ignore.

In 2009 the MIT Joint Program on the Science and Policy of Global Change published an analysis of climate policy targets under uncertainty. The analysis demonstrated that even a modest attempt to mitigate emissions could profoundly affect the risk profile for equilibrium surface temperature. They looked at five mitigation scenarios, from a ‘no mitigation action’ approach to a very stringent climate regime (Level 1, akin to a 2°C case). In the ‘no mitigation action’ approach, mid-range warming by the end of the century is some 5°C compared to the late 20th century, but with a wide distribution, which means that there is a small probability of warming up to 8°C or more – an unacceptably high outcome even when accounting for the small probability that it might occur. But even modest mitigation efforts, while not shifting the mid-range sufficiently for an outcome close to 2°C, nevertheless radically change the shape of the distribution curve such that the spread narrows considerably, with the highest impact outcome dropping by some 3-4°C. As mitigation effort increases and the mid-range approaches 2°C, the distribution narrows further such that the highest possible outcome is limited to 3°C.

Quite possibly, through the current actions of governments, the advance of technology and the first steps along the path laid out by the Paris Agreement, the ‘no mitigation action’ outcome is now off the table and the future risk profile is quite different to the one faced in 2001 when the IPCC 3rd Assessment report was published. While this is good news, it isn’t yet cause to stop and celebrate, given that there is now greater clarity on long term impacts such as sea level rise, which could be several metres even at 2+°C. But it could usher in a more matter-of-fact debate about climate change and mitigation, without the background cacophony.

Arguably, the space between 1.5 and 3°C may be where the real story now lies.

Note: Scenarios are not intended to be predictions of likely future events or outcomes and investors should not rely on them when making an investment decision with regard to Royal Dutch Shell plc securities. Please read the full cautionary note in http://www.shell.com/skyscenario.

A new era for aviation?

dchone October 9, 2017

The pressure to reduce carbon dioxide emissions and the prospect of a world running largely on renewable electricity has sent research and development teams in every sector back to their respective drawing boards to look at options that might exist for electrification. Perhaps the most challenging sector is aviation, where liquid hydrocarbon fuels are the only form of energy carrier available (mainly of fossil origin, but with some bio-origin fuels now appearing). The dependency on hydrocarbons is due to their high energy density and the challenge with fuel to weight ratio that planes have. However, fuel costs can represent up to 70% of total costs for an airline, so the business model tends to focus on efficiency as a primary consideration. Efficiency isn’t just about the plane itself, but about maximising passenger load, minimising extraneous weight, limiting taxiing and air traffic delays, using electricity for power at departure gates and optimising routes.

In the light of all the above, the idea of electrification in aviation is tantalizing, but there is little sight of this happening. At one end of the spectrum there is the prospect of single person electric drone taxis for short hops in cities, but after that there is nothing, until last week. EasyJet, in conjunction with the startup, Wright Electric, announced that they hoped to be flying a short-haul battery electric passenger plane within a decade.

The concept illustration looks impressive, but is this really feasible? Battery energy density is a key determinant and it is moving rapidly in the right direction. The energy density difference between the traditional Lead-Acid battery, still the standard for starting most cars and the best lithium based batteries is nearing a factor of 10, but lithium based batteries are still a long way from Jet A1 fuel as shown in the table below. The difference in energy density on a weight basis is around twenty times, in favour of Jet A1.

	Jet A1	Current Li-Ion Battery	Emerging Li-Metal batteries
Energy MJ/kilogram	42.8	~0.7	1.8
Energy MJ/litre	37.4	~2.0	4.3

Like an electric car, the efficiency of a battery electric aeroplane would be significantly higher than the combustion engine equivalent, although the starting point for a modern jet engine already exceeds that of vehicles. The chart below (IPCC Report on Aviation 1999, chart from 1991) shows that overall efficiency of jet aircraft falls in the range 20-40%, but significant improvements have been made since then. A modern Boeing 787 would show an overall efficiency approaching 50% on the same chart.

Even with near 100% efficiency for the battery electric aeroplane, the energy density of Jet A1 still gives that fuel a factor of ten advantage. As such, it will be distance that suffers, given there is a weight restriction for aeroplanes.

I am a regular traveler out of London City Airport and often see the Embraer 190 plane, which is similar in size to the easyJet concept photograph distributed with their announcement. But the Embraer 190 has a range of over 4,500 km, so one tenth of this gets near to the 335 mile range goal mentioned by easyJet, ideal for the flight I often take from London City to Rotterdam. So on paper, this would appear to work, but a plane with a range limit of a few hundred miles might significantly restrict the operational flexibility that airlines enjoy; for example, it couldn’t be swapped at short notice for a London City to Rome flight, should that be necessary.

Battery electric planes also bring with them a particular design change – apart from the obvious. Currently, planes land some 20% lighter than they take off, as they burn the fuel. With battery electric planes, they will land heavier than they take off, because the discharge of the battery means oxidation, meaning it gains mass. This will require very different landing gear.

Another facet of the EasyJet announcement is the desire to see these planes carrying passengers within 10 years. Given that the plane is concept only and doesn’t come from an existing family of similar planes, this may be ambitious. The 787 Dreamliner was announced in concept by Boeing in early 2003, finally receiving certification in late 2011. That’s nearly nine years for what is essentially a new version of an existing product, albeit with some significant changes such as the use of carbon fibre in the fuselage. But the 787 then had problems with its battery system for on-board electronics, leading to a temporary grounding and eventual regular flights from April 2013.

The 787 was not Boeing’s first attempt at a new aircraft following the 777 series. In the late 1990s it started development of the Sonic Cruiser, releasing a concept proposal in March 2001. With aviation business models changing rapidly at that time, Boeing abandoned this concept and instead moved to the 787, but this evolutionary process still consumed valuable design years. At least from one perspective, it could be argued that the 787 took over 13 years to go from concept to regular use.

The Wright Electric concept represents a revolutionary change in aircraft design and propulsion, so there is every chance that this may take longer than anticipated to get going. It will require extensive certification and testing by airlines, airports and the aviation authorities and may go through more than one design iteration, depending in part on the evolution of battery technology and the resultant changes in energy to weight and volume ratios. The story of the Mitsubishi Regional Jet is outlined here, and is a saga of changes and delays spanning 17 years. It is a conventional jet aircraft, but represents a first for Mitsubishi for a very long time.

A further ambitious aspect of this project is the notion that a start-up can take on the likes of Boeing and Airbus and find the necessary investors to back what is typically a multi-billion dollar investment in design, engineering, prototype development, manufacturing, testing and certification of a new aeroplane.

Behind all this is the pressing need for electrification across society, so this type of thinking and risk taking is essential. The question that remains though, is whether I will be able to ride in such a plane from London City Airport before 2030.

The battery that made headlines

dchone July 14, 2017

It is hard to imagine that something as mundane as a battery could make national headlines, but that is what happened last week in Australia. I was there for a family visit and as much as climate science gets debated in the media (see my previous post), it barely rates against the energy debate that has dominated the Australian headlines in recent months. The issue is the cost of electricity and the reliability of supply, both of which continue to be contentious subjects.

The cost of electricity has risen sharply in Australia over the last two years, but this has been coupled with supply problems that have led to blackouts in some parts of the country. This has been most visible in South Australia, which has closed all its coal fired power plants and invested heavily in renewable energy. The result is a wind / solar / natural gas power mix, backed up by an inter-connector with Victoria. For the most part this has been a workable solution, but when particular conditions coincide the result can mean blackouts or load shedding by some industrial customers. This usually involves periods of high load coinciding with low renewable energy availability at a time when some other part of the network is under stress, e.g. supply from the inter-connector. The problem is that this has happened enough times to become a major issue, leading to extensive media coverage, finger pointing and public outcry.

The reporting around this issue can be likened to the climate science debate I discussed in my last post – i.e. overly prone to hyperbole and lacking in basic facts. The solution that has been proposed for South Australia is the rapid construction of battery storage and into this foray stepped Elon Musk (CEO of Tesla). Some months ago, after power supply problems in South Australia hit the headlines yet again, he made the offer to build a major Lithium-Ion storage facility in 100 days, with no payment required if construction was delayed beyond that period. Not surprisingly this galvanized the government and led to a public tender for such a facility.

Last week the South Australia government announced that Tesla had won a tender to build a grid scale battery. The project will incorporate a 100MW peak output battery with 129 megawatt hours of storage alongside an existing windfarm, near Jamestown. Elon Musk flew into Adelaide for the announcement, which added to the fervour. What was interesting was the reaction in the media, ranging from support bordering on adulation to downright condemnation. Contrast the July 9^th Sun-Herald, where their social commentator Peter Fitzsimons noted;

Oh, how sweet it is. After all the haters, all the pile-ons, all the craven dinosaur politics which maintains that coal really does have a future, the SA government shimmies, shakes, steps left, steps right, bursts through into clear and announces its lithium battery deal.

. . . with political commentator Tim Blair in the Daily Telegraph on July 10^th, who starts a near full page article with the headlines;

Charge of the left brigade – People are falling over themselves to fawn over magic man Elon Musk’s battery absurdity but he is just the latest saviour to get the green light from eco worriers.

Neither are energy commentators of any note, but such is state of the energy transition debate in Australia that this doesn’t seem to matter. The controversy highlights the need for clear policy and thoughtful steps forward in implementing an energy transition, irrespective of the reasons driving such a transition, be they climate change, energy costs, local air quality or some combination of these and other needs.

In the case of South Australia, exuberance and some technology bias led to a rapid shift in the electricity system to a point where stability became a problem, which will now take some time to correct. The battery solution isn’t a full solution at all, but one of several measures that will be required to correct the imbalance that has been created. Alongside the Musk excitement, there was also the recent announcement that the government will build additional gas fired generation capacity at a cost of over A$300 million.

The South Australian electricity system operates at around 2-3 GW, with peaks and troughs depending on the time of day and year. Annual demand is some 14,400 GWh, or about 40,000 MWh per day. The initial battery capacity is 129 MWh. The gas capacity can add over 5,000 MWh per day if it operates continuously, or 13% of the demand. While the battery commanded all the headlines, it is clearly not a solution for extended periods of high demand or reduced supply, given that it can hold only 5 minutes of South Australian demand. However, it is an important step in the quest for a more balanced system that has very high levels (often >70%) of intermittent renewable energy. Further battery systems are likely, but a better balance between natural gas and renewable energy would appear to be the more achievable outcome in the short to medium term. It is also likely to be the more cost efficient outcome, given the ~A$100 million investment required (according to a local private source) for what will be the largest Lithium-Ion battery system in the world.

Drawdown, or not?

dchone June 14, 2017

A recent book and associated website discusses the steps necessary to address and even reverse the current warming of the climate system. The project, known as Drawdown, maps, measures, models, and describes the 100 most substantive solutions to global warming. For each solution, the Drawdown team describe its history, the carbon impact it provides, the relative cost and savings, the path to adoption, and how it works. Drawdown is that point in time when the concentration of greenhouse gases in the atmosphere begins to decline on a year-to-year basis.

Atmospheric carbon dioxide would likely stabilize before the world stops emitting (on a net basis) carbon dioxide from anthropogenic sources. This is because of the action of the oceans and the lag in carbon dioxide uptake that they exhibit. Net carbon dioxide emissions of 6-10 Gt per annum (currently 40 Gt per annum) are possible while atmospheric carbon dioxide plateaus, but emissions must eventually head to net-zero to see atmospheric carbon dioxide fall and for that trend to continue. Even then, the fall will be very slow given the quantity of carbon dioxide in the atmosphere and the rate at which the ocean can absorb it, at least until the surface layers are largely saturated. Further processes which involve fixing the carbon in ocean sediment and absorbing it through mineralization will play out over thousands of years.

‘Drawdown’ is a comprehensive piece of work and covers not just energy solutions such as replacing fossil fuel use with renewables, but also includes social changes such as the need for educating girls in developing countries. Education is linked to infant mortality, birth rates and therefore long term population trends, which in turn impacts energy use and therefore emissions. Within the website is a listing of the approaches, starting with Refrigerant Management at the top of the list. A change in this area is claimed to be the equivalent of 90 Gt CO2, but this is a more complex story as refrigerants are, for the most part, short lived climate pollutants (SLCP). I discussed this in a post last October, shortly after the Parties to the Montreal Protocol had agreed the Kigali Amendment which covers these refrigerants.

While the list covers areas such as electricity generation, land use change and transport, it has very little to offer for industrial processes, but seems to rely on them completely to deliver systemic change. Building wind turbines, developing mass transit, deploying nuclear power stations, manufacturing insulation and automating buildings will require large scale manufacturing and significant production of chemicals and materials. Today, these activities alone account for some 8 Gt of global carbon dioxide emissions, or nearly the same as transport. New activities such as building hundreds of TWhrs of battery storage are likely to exacerbate these emissions. Included within this there are significant emissions from the processes themselves, such as the carbon dioxide from the reduction of iron ore to make iron / steel and the calcination of limestone to make cement.

These activities are amongst the most difficult to decarbonise and lead to the need for carbon capture and storage (CCS). Capturing and geologically storing the emissions from cement manufacture may be far simpler than trying to find substitutes, developing alternative process routes or trying to offset the emissions through reforestation. The one hundred solutions offered on the Drawdown website make no specific mention of geological storage of carbon dioxide, yet venture into areas such as air capture of carbon dioxide. While the latter may provide a useful conduit towards synthetic fuels, it will make no difference at all to atmospheric carbon dioxide if there isn’t large scale storage involved.

‘Drawdown’ is an interesting piece of work, but it doesn’t tackle the real challenge associated with net-zero emissions, let alone actual drawdown of carbon from the atmosphere. These issues are tackled with much greater rigour in the recent Shell publication ‘A Better Life With a Healthy Planet: Pathways to Net-Zero Emissions’ and in my forthcoming book ‘Putting the Genie Back: Solving the Climate and Energy Dilemma’.

The USA and the Paris Agreement

dchone May 4, 2017

On April 26th the Washington DC based Center for Climate and Energy Solutions (C2ES) sent a letter to US President Donald Trump urging continued US participation in and support of the Paris Agreement. Shell was one of thirteen signatory companies. The arguments offered in the letter provided a perspective on the benefits that continued participation in the Agreement could bring to the business community in the United States, in the form of investment opportunity, cost minimization and risk management.

While these business benefits also translate into a benefit for the United States as a whole, the letter was not particularly specific on this matter. Benefits at a national level can be difficult to assess, but it is worth looking at these to get a full picture of where the Paris Agreement might take the US economy over the decades to come.

At its core, the Paris Agreement calls for a global shift to net-zero emissions of greenhouse gases, with carbon dioxide being the critical component of this given the scale and its accumulation in the atmosphere. The earlier net-zero emissions of carbon dioxide is reached, the lower the warming of the climate system is likely to be. That journey will require a major transition of the energy system, from one that emits carbon dioxide to one that doesn’t. This will require three core elements that have largely driven the economy of the United States over the last 150 years;

Innovation – the US has excelled in this area when challenged to do so, from the development of the first electricity grids by companies such as Edison Illuminating Company in the 1880s, through the moon landing in 1969 and the more recent landing of the Space X rocket on an ocean platform after launching a satellite into orbit. In the energy sector, this has included developments such as hydraulic fracturing (which enabled the rapid shift from coal to gas in the power sector), energy storage technologies, digital energy management and distributed energy systems. Particularly in the case of the USA, diverse, state level energy systems enable the unique ability to experiment with market and policy innovations on a smaller, sub-national scale.
Trade – the US is a trading nation and this is likely to be at the core of the implementation of the Paris Agreement. A world of net-zero emissions is not going to be a world of no emissions, but as the Agreement notes it will be one of balancing emission sources and sinks. Some form of trading, operating at significant scale, will be required to match these two parts. Significant trade will also arise from energy system deployment.
Scale-up – perhaps more than any other aspect of industrialization, the US has demonstrated time and again its ability to rapidly scale the solutions that innovation opens up. It has done this more recently with hydraulic fracturing for natural gas and now oil production, but during WWII the optimization and scale-up of various manufacturing disciplines led to Liberty Ship construction at the rate of three vessels per day. Today, we are seeing scale-up again with the construction of the Tesla Gigafactory in Nevada. More will doubtless follow.

A world heading towards net-zero emissions is one that the USA has the potential to thrive in;

It has vast natural resources, which almost certainly includes very significant geological storage capacity for carbon dioxide. That means the USA could position itself as a net-negative emissions economy, effectively selling stored carbon dioxide as an export. This would encompass its capacity for trade and scale-up in particular, as much of the innovation has already taken place, notably in the USA.
American innovation in the energy sector is well known, from the speedy development of nuclear power in the 1950s to the current rush towards ultra-low-cost solar PV and battery storage. Several start-ups are working new angles on nuclear fusion, an entrepreneurial approach to energy development that is hardly contemplated anywhere else in the world.
The USA is moving rapidly to become a major exporter of natural gas as LNG, a development that wasn’t even on the horizon just a decade ago. Natural gas demand could increase with energy consumers and national governments looking to reduce emissions, thereby offering the USA the opportunity to be a leader in the LNG space.
The US is the leading global developer of carbon capture, with more projects than any other country thanks to its sizable enhanced oil recovery industry. It has a mature and expanding carbon dioxide pipeline system, a key infrastructure requirement for the full development of CCS.

While none of the above specifically required the Paris Agreement as the enabler, there is equally no doubt that the UNFCCC process, fraught as it may sometimes appear, has catalyzed change in the energy sector over many years. For example, it has brought additional focus to renewable energy development, raised the profile of CCS and helped companies such as Tesla gain valuable traction as EV proponents.

The Paris Agreement has sharpened the emphasis on energy transition, along with other economic signals and drivers that continue to push the global economy forward. While the Agreement would continue without US involvement, the focus would be blunted to some extent, thereby weakening the global economic signal coming from it. With innovation, trade and scaled deployment at the core of the Agreement, those countries which excel in these areas, of which the USA is pre-eminent, may miss new growth opportunities.