The Renewable Energy Boom that Never Happened

 

The world was moving faster towards reducing its reliance on carbon intensive energy consumption in the 1970s and 1980s than in the past several decades. In fact, over the past 20 years there has been little if any progress in expanding the share of carbon-free energy in the global mix. Despite the rhetoric around the rise of renewable energy, the data tells a far different story.

Policy makers around the world have frequently expressed their desire to reduce the emissions of carbon dioxide to a level consistent with stabilizing the amount in the atmosphere at a low level. Conceptually, the challenge is akin to stabilizing the amount of water in a bathtub by modulating the amount filling the tub from a spigot. If there is an open drain at the bottom letting a bit of water out, then stabilization of the water’s height occurs when the amount coming into the tub equals the amount draining out.

The carbon dioxide is akin to the water filling the bathtub and the oceans and the land surface provide some take-up of carbon dioxide, serving like a small open drain at the bottom of the tub. For the stabilization of carbon dioxide, this means that emissions of carbon dioxide, which result primarily from the combustion of fossil fuels (oil, natural gas and coal), must be reduced by something like 80 percent or more.

However, instead of looking at the issue through the lens of emissions, another way to look at the challenge of stabilizing carbon dioxide in the atmosphere is through energy consumption. Whatever the total level of future energy supply turns out to be, to be consistent with stabilization – metaphorically stopping the rise of the water in the bathtub – the proportion of global energy that comes from carbon-free sources needs to exceed 90 percent. 

So how are we doing working towards that 90 percent?

BP, in its excellent annual statistical report on world energy, provides data that allows us to answer this question. The figure above shows the proportion of global energy consumption that comes from carbon-free sources. These sources include nuclear, hydro, solar, wind, geothermal, and biomass. The graph shows that from 1965 to 1999 the proportion of carbon-free energy in global consumption more than doubled to more than 13 percent, coincident with nuclear power increasing by a factor of 100 and hydropower by a factor of 6.

However, since 1999 the proportion of carbon-free energy in the global mix has dropped slightly. In fact, 1999 was the peak year for non-carbon energy. From 1999 to 2012 consumption of nuclear power dropped by 2 percent. While solar has increased its contribution to consumption by a factor of 100 and wind by 25 from 1999 to 2012, these sources remain at about 1 percent of total global energy consumption, and are dwarfed by the resurgence of coal.

Much is often made about the rise of renewable energy, but the data tells a more sobering story. In the ten years that ended in 2012, the world added about 2,500 million metric tonnes of oil equivalent (in layman’s terms, a lot) to its total energy consumption. Of that increase about 14 percent came from non-carbon sources. Compare that to the ten years ending in 2002, during which about 19 percent of the new energy consumption over the previous decade came from non-carbon sources. The figure above shows the proportion of annually added energy consumption that comes from carbon-free and carbon-intensive sources.

The data shows that for several decades the world has seen a halt in progress towards less carbon-intensive energy consumption, at about 13 percent of the total global supply. This stagnation provides further evidence that the policies that have been employed to accelerate rates of decarbonization of the global economy have been largely ineffective. The world was moving faster towards decarbonizing its energy mix long before climate policy became fashionable. Why this was so and what the future might hold will be the subject of future posts in this continuing discussion.

Source: 

http://www.oilprice.com

http://www.bp.com

World Future Energy Summit (WFES)

On an expanse of desert land in the United Arab Emirates, about 11 miles (7 kilometers) away from the bustling capital city of Abu Dhabi, there is a lonely outcropping of peculiar buildings -- a work in progress.

It’s called Masdar City, and it could represent the future of green living if all goes according to plan. This mini-metropolis -- where cars are prohibited and buildings are designed according to strict energy-efficiency rules -- is intended to generate almost no waste or refuse and be virtually free of air pollution.

Charles Ebinger, the director of the Energy Security Initiative at the Brookings Institution, has been to this experimental village. “You’re whisked to Masdar City on futuristic trains with no conductors, all on magnetic strips,” he said. “All the buildings there are using renewable energy. And they have channeled the airflow so the winds come through the streets in such a way that even in the dead of summer, it creates a cooling effect that obviates the need for a backup source of cooling energy.”

Amazing as it sounds, Masdar City is at risk of becoming a high-profile failure. Only a few hundred researchers and students live in this urban oasis, which was planned to house tens of thousands of people. An ambitious layout, including homes, businesses and recreational areas, has not yet materialized. The project’s initial 2016 completion date has been pushed back by at least 10 years.

This situation is indicative of the UAE’s strange relationship with renewable energy technology. The government is serious about green research and development -- and keen to publicize it. But in fact, this oil-rich gulf state has some major glitches to address before it can take its place as a global leader in green energy.

Meeting of Minds

The UAE makes no bones about its intention to become a hub for green energy enthusiasts around the world. This week, for the sixth year in a row, Abu Dhabi hosted a global summit to attract some of the best thinkers and businesses in the field of renewable energy.

The World Future Energy Summit, or WFES, ran from Tuesday to Thursday; over 30,000 people were in attendance. Keynote speakers included such luminaries as French President Francois Hollande, Argentinian President Cristina Fernandez de Kirchner, and Abu Dhabi’s own Crown Prince, Sheik Mohammed bin Zayed Al Nahyan.

The Emirates are a big oil producer, the seventh-largest in the world, according to the International Energy Agency: they pumped upwards of 3 million barrels per day in 2011, more than Iraq. Dimitra Ampela of Reed Exhibitions, which organized the WFES, does not see a paradox there. In fact, she said it’s precisely the Emirates’ history that makes the country well-suited to playing a leading role in renewable energy.

“UAE’s commitment to renewable energy and sustainability traces back to the late president and founder of the UAE, Sheikh Zayed bin Sultan Al Nahyan, who was adamant about conservation and encouraged the reduction of the UAE’s environmental footprint,” she said.

The summit attendees represented about 150 countries and 514 registered businesses, which set up booths in a massive convention hall and took the opportunity to build new connections.

“The atmosphere is very electric,” said Scott Burger, who traveled to Abu Dhabi to represent GTM Research, a division of the Boston-based Greentech Media, a clean technology research and media organization.

The paradox of building a center for Big Green Energy in one of the capitals of Big Oil was not lost on him; he noted that oil giants like Exxon (NYSE:XOM), Shell (LON:RDSA) and Statoil (NYSE:STO) were out in force at the event.

“There are some interesting dynamics on display. Given the deep relationships that many oil majors have with the Abu Dhabi government, they have some of the most prominent booths at the WFES. This is an interesting juxtaposition against the booths of solar, biomass and wind companies that are also present,” Burger said.

That oil companies would dominate the convention floor should come as no surprise; hydrocarbons were essentially the enabler for this event. Because of oil revenues, the country enjoys a friendly relationship with the West, its status as a major commercial hub, and a GDP-per-capita of about $48,000 -- the 12th highest in the world, just after the United States. Oil fuels the state-sponsored research that has made the UAE a pioneer in green energy.

Negative Energy

The strong dependence on hydrocarbon fuels leaves the UAE in a bind. The country actually has to import natural gas, and demand has outpaced domestic production since 2007. Oil, on the other hand, is plentiful -- but government officials aren’t fooled by the impressive profits. They are scrambling to diversify in order to avoid falling victim to market volatility, fluctuating prices and geopolitical conflicts in other oil-producing states.

And when it comes to renewable energy, the UAE may be impressive in terms of its commitment to research and development -- but in terms of performance, it’s got a long way to go. The tiny state is certainly not leading the way in terms of reducing its carbon footprint.

Carbon dioxide emissions per capita are sky-high at 22.6 metric tons, according to the latest data from the World Bank. That’s higher than any Western country -- but to be fair, much of that output can be blamed on factors somewhat beyond the UAE’s control: its role as a major oil and gas producer, its costly need to desalinate seawater, and its high-traffic international airports in Abu Dhabi and Dubai.

That’s why the UAE set a very low bar for itself in terms of renewable energy generation. The government is aiming for 7 percent of domestic power to come from renewable energy by 2030. By comparison, the European Union is shooting for 20 percent by 2020.

In large part, this sluggishness can be blamed on heavy government subsidies for the wrong kind of energy.

“The UAE is in a strange situation because they subsidize oil, gas and electricity so heavily for their domestic citizens that demand is spiraling out of control,” said Ebinger of the Brookings Institute. “There’s no demand to conserve gas and electricity because it’s so cheap, and it’s eating into the oil and gas that the country could export for profit.”

It would make sense to cut the subsidies that effectively cheapen its hydrocarbon output, but here political concerns outweigh economic ones. Recent Arab Spring revolutions in other Middle Eastern countries have spooked public officials in the UAE, a federation of seven monarchies in which average citizens have little say in the policies that govern their daily lives.

Vast wealth, and the fuel subsidies they enable, have so far kept the public complacent.

“[The government is] just so fearful of ending the subsidy in fear of a political backlash,” said Ebinger. “They really are sitting on a time bomb.”

A Way Out

If hydrocarbon subsidies are here to stay, the UAE’ s only way to generate more energy profits at home is to find new ways of generating power. But renewable sources like wind and solar just can’t be scaled up fast enough to meet growing demand, which will only accelerate with rapid population growth.

“You have to distinguish between research and commercialization,” Burger of GTM Research said. “What makes renewable energy technologies so difficult is the price it takes to scale them.”

For the UAE, nuclear energy presents a viable alternative. The government has already ordered four nuclear plants from South Korea, to be installed in Abu Dhabi. One is already under construction and could become operational by 2017, and educational initiatives are underway to train a new generation of students in nuclear reactor operations.

That leaves the market with little incentive to invest in cleaner, safer alternatives like solar, wind and biomass. So the government is footing the bill for research in that arena, crossing its fingers in the hopes that the risk will pay off.

“The market is simply not competitive, and renewable energy is very cost intensive,” said Karim Elgendy, the founder and general coordinator of Carboun, an advocacy organization promoting energy sustainability in the Middle East.

“With energy prices so low in the UAE, you can’t sell renewable energy at a reasonable price to make a profit, and you’re not going to invest in it. So instead of liberating the market and letting electricity prices go wherever they would go, the government takes it on. That’s why the country’s renewable energy initiatives are almost exclusively government-led projects.”

The UAE has the resources to fund these sorts of ventures; it also has the long-term incentive. But without the market on its side, the monarchy is walking a lonely road. 

The Global Stage

If Masdar City and the WFES are any indication, the UAE is certainly eager to put on a good show. Both these ventures are funded by Masdar, a subsidiary of the government-owned Mubadala Development Company. Masdar has never been shy about funding travel and accommodation for renewable energy buffs, public relations professionals and the press. The idea is that these investments will eventually pay off -- and judging by the deals closed at this week’s WFES, the strategy is working. 

Masdar inked a deal with the kingdom of Jordan, laying a framework for future cooperation on renewable energy projects. France also negotiated a stronger partnership with the UAE-owned company, building on years of collaboration on green projects.

Down in the booths, the deal-making was just as fervent. A handful of companies even received prizes for their work in renewable energy, including Ceres, a Boston-based non-governmental organization that works with investors and policymakers in Europe and the United States to advocate for sustainable energy practices.

Ceres received $1.5 million when it won the Zayed Future Energy Prize in the NGO category. Company spokesperson Peyton Fleming said the funds would be used to strengthen its ongoing initiatives.

“Our perspective is that you need both stronger government policies and strong private action from companies and investors,” he said. “Unless companies and investors are investing trillions of dollars in this space in coming years, and until that amount of capital is moved into the clean energy economy, we are still going to be wrestling with rising greenhouse gas emissions.”

That’s a philosophy the UAE can certainly relate to. And despite formidable challenges the government faces in the field of renewable energy generation at home, there’s no denying the progress the small Gulf country has made.

Masdar City, that metropolis in limbo, can now boast a fully operational school and research facility called the Masdar Institute for Science and Technology.

“The UAE has invested a lot in the Masdar Institute for Science and Technology, which has an extensive renewable energy lab and is collaborating with Massachusetts Institute of Technology,” said Elgendy, who has visited the facility.

The green businesses and clean-energy homes may be missing from the scene, but research and development are flourishing.

That’s where the UAE has made the most impact so far, and where it still leads much of the world in terms of committed resources. Polluted air, oil rigs and half-finished projects notwithstanding, the UAE has at least proven its dedication to engineering the technologies that the rest of us may need in the decades to come.

Solar energy replaces nuclear energy in Germany

Sun! A star located some 150 million kilometers away is unarguably the most important element for human race as it is their source of life among other vital things. In a latest breakthrough in solar technology, Germany has set an example that cannot be challenged. In late May this year, Germany solar power plants generated a record breaking 22 gigawatts of electricity per hour. This amount of electricity is equal to the power generated by 20 nuclear power plants working at maximum capacity. The 22 gigawatts produced from Germany’s solar plants was utilized throughout the country during midday hours for two consecutive days.

Last year, an unfortunate event that took place in Fukushima, where a great loss of life occurred because of the Nuclear Plant meltdown following the Japan earthquake and Tsunami in March, last year.

After the Fukushima disaster, the German government abandoned their plans to use nuclear power and shut down eight of their 17 nuclear plants immediately and plans to shut down the remaining nine by the year 2022. This move had naturally motivated the German government to look for more practical and renewable energy sources like wind turbines, solar and bio-mass which is basically biological material from living or recently living material which is turned into bio-fuel for energy.

Germany’s director of Institute of the Renewable Energy Industry (IWR), Norbert Allnoch, said that the 22 gigawatts of solar power per hour met almost 50% of the country’s mid-day electricity demands.

“Never before anywhere has a country produced as much photovoltaic electricity,” Allnoch told Reuters. “Germany came close to the 20 gigawatt (GW) mark a few times in recent weeks. But this was the first time we made it over.” he said, while speaking to Reuters. This breakthrough which was supported and funded by the German administration has proved that a full-fledged industrial country was able to keep up with a third of the nation’s energy demand on a working day and half on the weekend, when factories and mills were closed. Germany is now second in the list of countries using renewable energy sources and the leading country in the list of countries using solar technology, followed by Spain which stands at number two.

The solar power generation capacity of Germany is almost equal to the rest of the world combined. It gets about four percent of its overall annual electricity from the sun and it aims to cut its greenhouse gas emissions by 40 percent by the year 2020.