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Wednesday, December 23, 2015

THE PRESENT AND FUTURE OF RENEWABLE ENERGY

A glance at the right column can tell you that our world economy is only woefully powered by renewable energy.  Further, that oldest of options, hydroelectric power, was more than half of all the energy provided by solar/wind/biomass/geothermal/ocean seven years ago:

For the first time, all the other non-hydro renewables finally overtook hydroelectricity, at least in the USA:


Yet, you need to keep in mind two things:  electricity generation only uses a bit more than a third of all energy consumed, and very little renewables supply transport, heating, etc.  Here is a projection from the U.S. Energy Information Agency, showing that renewables are showing some progress, but will continue to be overshadowed by the assortment of fossil fuels, including coal, into 2040 and beyond.

How can the above continue in view of global warming?  Well, that is the reality.

Yes, but the headlines indicate that there was a Paris agreement to cooperate in carbon emission control, right?
Sure, but the above come from RenewableEnergy.World.Com and the American Solar Energy Society.  Their editors are beholden to provide a positive impression.  Bloomberg indicates "A Toothless Treaty Can't Stop Climate Change" and Politico says "Why the Paris Climate Deal is Meaningless."  But this is because green organizations want to show progress, while industry continues to drag its feet.

The above non-decision is bad for the renewables, because in addition to the falling price of oil (scroll down to the next posting), something like a carbon tax, which is essential for the solar options to show strong growth, is nowhere near a universal reality.  At this stage major renewable companies are on the verge of bankruptcy:
  • Abengoa has filed for creditor protection, making this the largest firm to ever go broke in Spain.
  • American biofuel company, KIOR, supported by Vinod Khosla and Bill Gates, filed for bankruptcy.

Mind you, solar energy companies are mostly meta-stable anyway, and 112 companies in the U.S. and European Union have disappeared the past five years.  In the UK, government cut subsidies and 1000 jobs were lost.  In the USA, Congress passed the Investment Tax Credit (ITC).  Reported RenewableEnergyWorld:

The ITC helped annual solar installation in the U.S. grow by over 1,600 percent since the ITC was implemented in 2006, creating hundreds of thousands of jobs, and supported the cost of solar PV dropping 95% since 2008.

What this means, of course, is that solar cannot today compete with the conventional energy sources, and certainly, not when oil is at $35/barrel.  SO, TO BE BRUTALLY FRANK, I WOULDN'T BUY ANY RENEWABLE ENERGY STOCKS TODAY, especially since you already missed that ITC bump.

What, then, about the future of renewable energy?  
  • Well, the Chicago Mercantile Exchange reports petroleum will sell for $55/barrel in December of 2024.  As we've seen the past, though, a hot war in the Middle East and skyrocketing oil costs will occur again.  The currently low prices will only get worse when Iran re-enters the picture, but will edge up for a while when Saudi Arabia decides that a sufficient number of fracking companies have given up.
  • Much of wind power and geothermal is cost competitive with current electricity prices.
  • Even the International Energy Agency (a European organization bullish on the fossil fuels and nuclear power) indicates that solar PV is today competitive with electricity.
  • In Hawaii, because our rates are three times higher than the national average, residential PV makes sense.  Not so for many homes in the USA.
  • Utility-size PV could well here and there compete with local electricity rates.

 Energy Plant TypeLifetime Cost  ¢ per Kwh
 Offshore Wind20.0
 Peaker Natural Gas18.0
 Coal with CCS14.4
 PV Solar12.5
 Gas Combined Cycle with CCS10.0
 Biomass10.0
 Advanced Nuclear9.5
 Conventional Coal9.5
 Hydro-electric8.4
 Natural Gas Combined Cycle7.5
 Land Based Wind7.4
 Geothermal4.8

Note the financial attractiveness of geothermal and land-based wind energy.  PV competes well with carbon captured and stored coal (CCS), except for one problem:  this system does not  yet exist, and won't, until laws make it mandatory.  PV needs to drop costs down to conventional coal and natural gas generated electricity if there is no ITC, which adds the matter of storage and power quality into the equation, formidable hurdles.

Biofuels will have a more difficult development path.  Ethanol from corn was a tragedy.  Helped the farmers, but hurt world food supply.  No matter how you technically analyze, the USA, and the world which followed, should never have gone with ethanol.  Congress was hoodwinked by the Farm Lobby.

I led a U.S. Department of Energy five-year project which showed that biofuels from micro algae will only begin to compete when petroleum goes up to the $120-$150/bbl range, if not higher.  Remember, oil is today around $35/bbl and the Chicago Mercantile Exchange speculates a price of $59/bbl at the end of 2024.  Continue to do the basic R&D on this pathway, but don't hold your breath for any early commercialization.

I still think the world should look closer at gasifying and catalyzing biomass into bio-methanol, and in parallel develop a direct methanol fuel cell (DMFC) for transport applications.  Certainly, bio-methanol shows more promise than bio-ethanol.

Yes, but what about electric vehicles or hydrogen powered fuel cells?  Toyota, apparently, is abandoning the lithium battery for a hydrogen fuel cell, starting with their Mirai to the right.  Lithium will always be too expensive and, by the way, is the last battery.  Seven years ago one of my HuffPos dismissed both in favor of the DMFC:

Per unit volume, a fuel cell should be able to provide five times more energy than the lithium battery. Chapter 3 of Simple Solutions for Planet Earth provides the details on fuel cells, but, in short, this device works like a battery to produce electricity, but uses hydrogen as the energy source instead of lithium, lead or cadmium. However, and this defies common sense, one gallon of methanol has more accessible hydrogen than one gallon of liquid hydrogen. Thus, the logic argues for producing methanol from biomass to power a fuel cell, as hydrogen is very expensive to manufacture, store and deliver. This simplest of alcohols is the only biofuel capable of directly and efficiently being utilized by a fuel cell without passing through an expensive reformer.

This is an overkill of information, but the DMFC finally seems poised to make a move:


However, when it comes to aviation, there is something overwhelmingly attractive about a fuel capable of providing high energy with low weight.  That is hydrogen.  While various bio jet fuels are being studied, in the long term some consideration should be given to the hydrogen jetliner.  This will take a generation (quarter century) at least to commercialize, so now is the time to start doing some real R&D.  Could this Hydrogen Clipper lead the way?


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