Coal, fossil fuels and thinking the unthinkable

The world can continue burning coal at current rates for 128 years before proven and recoverable coal reserves run out, according to data in the 2010 Survey of Energy Resources published by the World Energy Council in Montreal this week.

Reserves are well distributed among some 75 countries and the price of coal has historically been lower and more stable than that of other fossil fuels, the survey says. For this reason, coal “is likely to remain the most affordable fuel for power generation in many developed and developing countries for several decades.”

Its use is expected to rise 60 percent by 2030, WEC says, meaning that little will change in the global energy mix over the next 20 years.

“Generally, fossil fuels currently account for about 80 percent of primary energy demand and this figure is expected to remain largely the same through to 2030,” according to WEC.

The world’s continued dependence on fossil fuels for the foreseeable future has been a recurring theme at the WEC’s World Energy Congress, so much so that even a panel of executives and government officials asked to “Think the Unthinkable” focused on their efforts to address the current trends of emerging market growth, urbanization, demand for gas, etc.

This prompted a frustrated member of the audience to remark that the panel’s approach recalled Einstein’s definition of insanity: doing the same thing over and over again and expecting different results.

Miguel Martinez, chief operating officer of Repsol YPF, said today’s mission must be to gain time and to pursue all options that make non-renewable fuels less carbon intensive while affordable sustainable alternatives are pursued.

The WEC survey shows that much is already being done. World wind energy capacity has been doubling about every three-and-a-half years since 1990, while the global market for photovoltaic solar panels has been growing at an average of 47 percent per year for the past five years. But there is still a long way to go, it says.

“It will take decades before renewables will be able to provide a sizeable contribution to meeting energy demand,” the survey says. “In the meantime, the world should focus on increasing efficiency across across the entire energy value chain.”

The thorny issue of free energy markets

A consensus has emerged at the World Energy Congress on three goals for the future of energy, Pierre Gadonneix, Chairman of the World Energy Council and honorary chairman of French utility Electricité de France. It needs to support economic growth, reduce pressure on the environment, and reduce social inequality around the world.

These three goals require the development of new, more sophisticated and safer technologies, which in turn requires more investment that is likely to impact costs, he said. Free trade in energy would go a long way to meeting the goals, Gadonneix argued, by making energy more readily available, by promoting economies of scale and reducing costs, and by facilitating the transfer of technology.

Yet, the energy sector is one of the most protected worldwide, and protectionist measures have worsened since the onset of the financial and economic crisis two years ago, he said. Canada, with more energy resources than it needs for itself, is keener than most to maintain open energy markets. Some 20 percent of Canada’s exports are in the energy sector, said Trade Minister Peter van Loan (on right in the photo).

Pascal Lamy (left in photo), head of the World Trade Organization, agreed that more predictable and transparent international rules could benefit both countries which produce and those that consume energy, but warned the industry not to expect too much. There have been previous attempts to liberalize energy trade, at least since the 1970s, and all have failed, he noted.

The WEC’s three main goals of energy accessibility, availability and acceptability require energy solutions that are both long-term and sustainable, and this means that social and environmental concerns must be at the heart of our future energy system, he said, speaking by video from the WTO head office in Geneva.

“The answer can only be energy efficiency, more renewables and changed lifestyles,” Lamy added.

Interview: Improving efficiency through energy management

Reducing energy costs is gaining attention as a strategy for increasing the productivity of industrial production processes. Bashir Ahmad, sales engineer for ABB Energy Management Systems in North America, presented a paper on “The energy efficient enterprise” at the World Energy Congress on Sept. 14. In this interview, he explains what an Energy Management System is and how it enables customers to reduce their energy consumption.

Challenging the notion of an acceptable energy policy

Emissions need to fall by 80 percent by 2020 to secure the future of civilization, according to Lester Brown, President of the Earth Policy Institute in the US. With this dramatic statement, Brown opened discussions on the challenge of the acceptability of energy solutions on the third day of the World Energy Congress.

Brown framed the challenge as an issue of acceptability to nature: if our energy solutions are not acceptable to nature they are by definition unsustainable and will threaten life as we know it. The institute reached its emissions reduction target for the next 10 years by assessing the science rather than what may be politically acceptable, he said.

“When we begin looking at the changes we need to make and the limited amount of time we have to make the changes, what we’re looking at is something approaching a war-time mobilization to restructure the global economy,” Brown said.

He pointed to the very rapid deployment of wind power projects in Texas and in China as evidence that change can happen quickly where there’s a will. He suggested accelerating the transition by creating additional incentives to invest in clean technology by restructuring the tax system to raise taxes on carbon while reducing them by a corresponding amount on labor.

The weak link is probably going to be the food supply, according to Brown. Already about 20 countries are over-pumping aquifers to grow food, while global warming is threatening the glaciers that feed many of the world’s rivers on which so much irrigation depends. Early indicators of a breakdown include a rise in recent years in wheat prices, in the number of hungry people in the world and in the number of failing states, he said.

Speaking after Brown, Yvo de Boer, the former executive secretary of the United Nations Framework Convention on Climate Change, said the targets agreed on at last year’s climate conference in Copenhagen would require a 50 percent reduction in emissions globally by 2050.

Although the parties at the conference failed to agree on binding global targets, more than 100 countries have since pledged to pursue national action plans to reduce emissions. The challenge now, De Boer said, is turning the political ambiguity of the outcome into business reality by developing common metrics for measuring success and reporting guidelines for businesses.

Only then, he said, will it be possible to hold companies and countries accountable for meeting the goals in the action plans.

Interview: reducing ship emissions with power from shore

Ships still consume energy when they are berthed at port, running their diesel generators to power onboard facilities and emitting CO2, nitrogen oxides and sulfur oxides in the process. With growing pressure on the industry to reduce emissions, an increasing number of ports are introducing shore-to-ship power supplies to enable the ships to draw electricity right from the quayside. ABB's Knut Marquart presented a paper at the World Energy Congress on Sept. 15 on "Effectively reducing emissions from ports," and explains in this interview how it works.

Energy efficiency a key theme at WEC 2010

One of the key themes emerging from keynote speakers and roundtable discussion alike at the World Energy Congress is the need to improve energy efficiency. A roundtable dedicated to that topic provided the following facts and highlights:

Improvements in energy productivity have lagged behind material and labor productivity gains in the past 50 years. Energy efficiency offers the most affordable means of delivering energy.

But, energy efficiency:

• requires outlay
• has low mind share
• is fragmented across many devices
• is difficult to measure

Some energy efficiency barriers:

• Structural
• Behavioral (lack of awareness, customer and habit)
• Availability (capital availability)

George Arnold, the National Coordinator for Smart Grid Interoperability at at the US National Institute of Standards and Technology (NIST), spoke about the electrical infrastructure of the United States and what needs to be done to lead to a “smarter” grid in which energy would be used more efficiently. The US has the most extensive infrastructure in the world, he said, with 3,100 electric utility companies, 10,000 power plants, $247 billion in annual revenue and $800 billion in assets. But because this infrastructure has been built over a period of some 90+ years, it has some defining characteristics:

• One-way flow of electricity
• Centralized, bulk generation
• Responsible for 40 percent of human caused CO₂ production
• Limited automation and situational awareness
• Lack of customer-side data to manage and reduce energy use
• Less automation than the telephone networks of 30 years ago
• Customers not usually thought of as being “in the grid”

There are some smart grid goals that NIST has defined:

• Enable customers to manage and reduce energy use
• Enable increased use of renewable resources
• Improve efficiency, reliability, and security
• Facilitate infrastructure for electric vehicles, especially fast-charging and load balancing

What will smart grid look like?

• High use of renewables, 20-35 percent by 2020
• Distributed generation and microgrids
• Net metering - selling local power into the grid
• Distributed storage
• Smart meters - real time usage data
• Dynamic pricing
• Ubiquitous smart appliances
• Energy management in houses as well as communications and independent facilities linked to the grid.

In addition to Arnold, several other members of the roundtable offered insights into energy efficiency. For businesses, energy efficiency across the value chain a good measure of how well-managed a business is. Energy efficiency is not new, but it is underutilized. From 1970 to 2008, energy efficiency gains met 75 percent of new energy demands in the United States. A quote from Steven Chu, US Secretary of Energy, highlights that a lot more can be done: "Most dramatic reductions in greenhouse gas emissions will come from energy efficiency and conservation."

There are two ways of improving energy efficiency: passive (devices, installation) and active (optimizing usage and installation of devices, and monitoring and maintenance). To achieve true energy efficiency requires long-term engagement and a process. It is not just about the installation of new devices; it is also necessary to audit, measure, and manage. Another way to improve efficiency and reduce costs is to make energy visible, that is, to compare energy costs by creating energy dashboards so that consumers and companies can be aware of their energy outlay.

There are several barriers to making energy efficiency more visible, but the consensus of the panel was that we need people with the right skills, knowledge, management and especially leadership.

Technical Papers for Wednesday, September 15

Below are the technical papers being presented by ABB'ers today at the World Energy Congress in Montreal. All papers will be delivered at September 15, 2010, from 3:00 – 4:15 p.m at the Palais de Congres. Please check local listings for room assignments.

Session name: Full life cycle - the only reliable framework for impact assessment

Presenter: Asmund Maeland, ABB

Paper: Powering oil & gas offshore operations from mainland eletrical grid

Session name: Road map to efficient energy policies

Presenter: Knut Marquart, ABB Ltd

Paper: Effectively reducing emissions from ports