Industry news
Things I noticed and thought were interesting
Week ending June 3rd 2018
1, Electric vehicle cost projections. VW repeated that it expected to sell 3m EVs a year by 2025 (about 25% of unit sales). Reuters news agency reported comments from the head of EVs at the core VW brand: ‘to stoke mass demand, VW is aiming to sell its EVs at the price of conventional combustion engine cars, drawing on MEB (standardisation) synergies and falling battery costs’. In a striking contrast, BP said last week that it expected EVs to be price competitive with conventional vehicles sometime ‘before 2050’, or approximately 25 years after VW. The reason lies in expectations of battery costs: VW projections for 2020 show batteries at around $90 per kWh while BP forecasts a cost of nearly double this amount.
2, Wind+solar+battery. We’ll see much more development around the world of portfolios of wind and solar assets under single control. Particularly when combined with large battery projects, mixed renewables offer greater reliability of power supply. Swiss investor Partners Group put over $500m into a plan to build a mixture of 1.3 GW of wind, solar and battery assets over the next few years in Australia. The intention is to use the platform provided by the portfolio to offer reliable 24/7 power at prices that beat electricity from coal.
3, Hydrogen. France announced what I think is the first comprehensive plan to kick-start a hydrogen economy, accompanied by over €100m of subsidies. It set 2023 targets of 10% of all industrial hydrogen to come from carbon-free electricity (via electrolysis), 5000 hydrogen fuel cell cars on the road, 200 trucks and 100 refuelling stations as well as making plans for injecting hydrogen into the natural gas network. The minister for the ‘transition ecologique’, Nicolas Hulot, also pushed for development of power-to-methane, with the CO2 coming from industrial processes and hydrogen from electrolysis. ‘Hydrogen represents a way of arriving at 100% renewable energy’ he wrote while stressing the potential benefits of France leading a new industrial sector. French oil company Total was specifically sceptical about the plans for hydrogen in cars saying ‘We find it difficult to be convinced it has a future in 10 years time’.
4, Electric vans. Deutsche Post (post and DHL deliveries) opened a second factory in the Rhineland to make its StreetScooter delivery vans. With a range of up to 80 km, a capacity to stop and start 300 times a day and a payload of almost a tonne, the van can handle postal delivery circuits in most towns. Deutsche Post/DHL now has 6,000 of these vehicles (about ten per cent of its fleet) and sells them to third parties. It claims ’60-80% reduction in maintenance and wear’ costs but doesn’t specify the price of the vehicle itself. The second factory increases total capacity to 20,000 vans a year. (For a comparison, UK sales of all types of light commercial vehicles are just under 400,000 a year)
5, Carbon emissions from agriculture. A superb paper looked at the greenhouse gas impact from global agriculture, estimating that the food sector contributes about a quarter of all emissions. If the world moved to a diet without animal products, GHGs from the agricultural system would be cut by about half. Cattle production is the biggest source of potential reductions, with a 100g of beef protein resulting in an average of about 50 kg of emissions (a 500 to 1 ratio). One implication of this extraordinary number is that driving a car is less GHG intensive than walking if the person replaces the energy used while exercising with a meal based on beef. (More on this controversial assertion here). Also assessed in the new paper are the land and water use implications of our current food system, showing that a 100% non-animal diet would cut total agricultural land use by three quarters. This, of course, would allow extensive reforestation, and consequent CO2 extraction from the atmosphere.
6, Short term storage and intermittency. My guess is that electric car batteries represent the best way of dealing with the daily intermittency of renewables. Other technologies seem to me to be more expensive and less responsive. This prejudice was backed up by a good study on California. The researchers showed that adjusting the rate of car charging (vehicle from grid) could provide most of the storage mandated by the state government to accompany its target of 50% renewables by 2030. And if some of these cars could also discharge at times of shortage (vehicle to grid), California could avoid well over ten billion dollars of investments in stationary batteries and provide far more usable short-term storage than is currently planned.
7, Another ‘power to gas’ experiment. A Spanish utility put a power-to-gas pilot next to a wastewater treatment plant in Catalonia. This is a small experiment using the technology of German start-up Ineratec (a spin-out of the Karlsruhe Institute of Technology). Wastewater treatment produces biogas, a mixture of CO2 and methane. Power-to-gas processes can convert the CO2 in biogas to 100% methane by adding hydrogen and producing a stream of pure gas that can be injected into natural gas networks. Why is this important? The natural gas network in Spain has a storage capacity of about 30 TWh, equivalent to six months of the country’s entireproduction of renewable electricity. Seasonal power surpluses can be stored chemically in the natural gas network. Ineratec’s technology is used in other interesting synthetic fuels experiments, including the Soletair project in Finland.
8, Hydrogen fuel cells. Japan’s Toshiba announced further sites using its fuel cells to convert hydrogen to power and heat. At one location – a new hotel in Kawasaki – the hydrogen will be supplied from a factory that converts used plastics into hydrogen and CO2. The CO2 is captured and used and the H2 shipped to the fuel cells at the hotel. Toshiba has now delivered over 100 fuel cell systems that use hydrogen to provide energy for businesses.
9, Carbon capture in a power plant. The NET project in Texas plans to use hot, highly compressed CO2 to drive a turbine. The possible efficiency of the process – called the Allam cycle – is higher than a conventional gas turbine meaning it may produce cheaper electricity. The second feature of the plant is equally innovative. The plant obtains the heat it needs to sustain electricity generation by burning natural gas in pure oxygen. The waste CO2 from this combustion is 100% pure meaning that capture costs are tiny, unlike in a standard power station where the gas needs to be separated from the other flue gases. This is why the technology excites interest. Initial testing has started at the plant but it will be late 2018 before full scale operation begins. The challenge will be to find a use for the waste CO2. Currently there is talk of injecting into oil fields to increase the amount of fossil fuel produced. This does little for total emissions but a more logical route is to use the CO2 as the raw material for synthetic fuels, such as the production of methane to create a circular, non-polluting cycle. (Thanks to Greg Ford).
10, Corporate sourcing of renewable energy. A report from IRENA said that purchases of clean energy by companies now amount to about 465 TWh a year, or over 1.5% of total global electricity production. Over 2,400 companies were analysed, of which over 200 now source more than 50% of their power from renewables.
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