Renewable Energy Management

Seminar 1: Introduction

Prof. Dr. Joern Hoppmann

Management Research Group

Renewable Energy Management | Seminar 1: Introduction Prof. Dr. Joern Hoppmann | 18/10/2023 | 1
Course Structure

Week Seminar Homework Assignment

18/10/2023 Lecture: Formalities & Introduction -

25/10/2023 Lecture: Energy Markets Read Energy Markets Game Intro

01/11/2023 Exercise: Energy Markets Game -

08/11/2023 Lecture: Renewable Energy Policy Read Energy Policy Simulation

15/11/2023 Exercise: Energy Policy Simulation -

22/11/2023 Lecture: Renewable Energy and Society Read Intro Stakeholder Discussion

29/11/2023 Exercise: Stakeholder Discussion -

06/12/2023 Lecture: Renewable Energy Start-ups and Strategy Develop Start-up Idea

13/12/2023 Exercise: Start-up Pitches -

20/12/2023 Lecture: Renewable Energy Investment and Finance Read Exercise Investm. Calculation

10/01/2024 Exercise: Investment Calculation -

17/01/2024 Lecture: Renewable Energy Innovation and Project Management -

24/01/2024 Guest Lecture and Exam Prep -

31/01/2024 Exam and Discussion Course Evaluation -

Renewable Energy Management | Seminar 1: Introduction Prof. Dr. Joern Hoppmann | 18/10/2023 | 2
Learning objectives

At the end of the session, you should…

§ Have an overview and basic understanding of renewable

energy technologies
§ Know what management is
§ Understand important economic principles and indicators
§ Know the different environmental spheres that affect the
economic behavior and performance of firms

Renewable Energy Management | Seminar 1: Introduction Prof. Dr. Joern Hoppmann | 18/10/2023 | 3
Agenda

1 Introduction to Renewable Energy

2 Introduction to Management and Economics

Renewable Energy Management | Seminar 1: Introduction Prof. Dr. Joern Hoppmann | 18/10/2023 | 4
Definitions

Energy
Ability to do work or to produce heat (scientic units: Joule (J), calorie (cal),
Kilowatthours (kWh), British thermal unit (Btu)). Energy can neither be created nor
destroyed, only transformed or converted.

Power
The rate of doing work (measured in watts (W) or, less frequently, horsepower)

Renewable Energy
Energy from a source that is not depleted when used (e.g., solar or wind)

Sources: Britannica; Lumen Learning; Oxford languages

Renewable Energy Management | Seminar 1: Introduction Prof. Dr. Joern Hoppmann | 18/10/2023 | 5
Primary uses of renewable energy technologies

Electricity generation

Renewable
Heat generation
Energy

Transportation

Renewable Energy Management | Seminar 1: Introduction Prof. Dr. Joern Hoppmann | 18/10/2023 | 6
Renewable electricity generation technologies

(Pumped) Hydro Biomass and Biogas Onshore Wind Offshore Wind

Water flowing down Energy crops (e.g., Movement energy of Movement energy of
river or (artificial) lake corn), wood, or bio wind on land is wind on sea is
drives water turbine waste (e.g., from translated into rotation translated into rotation
animals) are burned of blades which drive of blades which drive
or gasified, driving a a wind turbine a wind turbine
steam turbine

Renewable Energy Management | Seminar 1: Introduction Prof. Dr. Joern Hoppmann | 18/10/2023 | 7
Renewable electricity generation technologies

Solar Photovoltaics Concentrating Geothermal Power Tidal and Wave Power

(PV) Solar Power (CSP)
Water is pumped into Capturing power of
Sunlight hitting PV Mirrors reflect lower geological wind waves or tide (i.e.,
panel releases sunlight on tube or layers, where it current caused by
electrons in central tower filled heats up, rises, and gravitational pull of the
semiconductor with fluid which is drives steam engine sun) by means of rotors
material, producing evaporated and or floating devices
electric current drives steam turbine

Renewable Energy Management | Seminar 1: Introduction Prof. Dr. Joern Hoppmann | 18/10/2023 | 8
Renewable heating technologies

Solar Thermal Heat Pump Wood Stove and Biogas

Wood Pellets
Fluid running through Heat energy in air, Gas from biomass or
tubes is heated up ground or water is Wood is burnt and methanized from
and heat transferred absorbed by cold heat used to heat up renewable energy
to water in water tank fluid, which is fluid technologies is burnt
compressed using in conventional gas
electricity. Resulting boiler
heat is transferred to
heated space

Renewable Energy Management | Seminar 1: Introduction Prof. Dr. Joern Hoppmann | 18/10/2023 | 9
Renewable transport technologies

Electric Engine Fuel-Cell-powered Biofuel-powered Biogas-powered

Powered by Renewable Electric Engine Combustion Engine Combustion Engine
Electricity
Hydrogen produced Biofuels stored in Biogas stored in gas
Electricity generated using renewable conventional vehicle tank is burned in
from renewables is energies and stored in tank are burned in combustion engine
stored in batteries and hydrogen tank drives combustion engine
drives electric engine fuel cell

Renewable Energy Management | Seminar 1: Introduction Prof. Dr. Joern Hoppmann | 18/10/2023 | 10
Development of global direct primary energy
consumption

Renewable Energy Management | Seminar 1: Introduction Prof. Dr. Joern Hoppmann | 18/10/2023 | 11
Agenda

1 Introduction to Renewable Energy

2 Introduction to Management and Economics

Renewable Energy Management | Seminar 1: Introduction Prof. Dr. Joern Hoppmann | 18/10/2023 | 12
Definition Management

Management

Management as
Management as Management as
an activity:
an organizational unit: a discipline:
Includes the processes of
All individuals that take on Describes and analyzes
planning, executing and
leading roles in the leadership instruments
controlling work
organization and frameworks
processes

But why do we need

management?

Source: BWL-wissen.net

Renewable Energy Management | Seminar 1: Introduction Prof. Dr. Joern Hoppmann | 18/10/2023 | 13
Economic Principles: Efficiency and Effectiveness
Resource use
(input)
Efficiency is a measure of economic
behavior: Working efficiently means
achieving a goal with the least possible
use of resources.
Source: Brettel, 2011
Renewable Energy Management | Seminar 1: Introduction
Goal achievement
(output)
Effectiveness is a measure for the
achievement of goals: To work effectively
means to achieve a defined goal by using
all means. Only the extent and quality of
the achievement of the defined goal are
the criteria for the existence of
effectiveness.
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Economic principles: Rationality principle

Rationality Principle

An economic subject acts according to the principle of rationality when choosing

between (two) alternatives for the better solution.

• In reality, decisions often deviate from the rationality principle for various reasons,
e.g.:
• Limited or distorted perception: Incomplete information, limited attention
• Limited resources to identify or evaluate alternatives
• Social norms and regulations: Choice of economic alternatives may be
socially undesirable or even prohibited

Source: Wöhe/Döring/Brösel, 2016, S. 33.

Renewable Energy Management | Seminar 1: Introduction Prof. Dr. Joern Hoppmann | 18/10/2023 | 15
Economic indicators

Description Formula

Purely technical indicator to compare the input 𝑂𝑢𝑡𝑝𝑢𝑡

Productivity and output on different technical dimensions 𝑃𝑟𝑜𝑑𝑢𝑐𝑡𝑖𝑣𝑖𝑡𝑦 =
𝐼𝑛𝑝𝑢𝑡
(e.g., number of pieces, weight or time).

Describes the relationship between income

(= monetary value of all services performed in the 𝐸𝑎𝑟𝑛𝑖𝑛𝑔𝑠
Economic 𝐸𝑐𝑜𝑛𝑜𝑚𝑖𝑐 𝑒𝑓𝑓𝑖𝑐𝑖𝑒𝑛𝑐𝑦 =
Efficiency period) and expense (= monetary value of all 𝐸𝑥𝑝𝑒𝑛𝑠𝑒𝑠
services consumed in the period).

Corresponds to the difference between income (=

value of all services performed in the period) and 𝑃𝑟𝑜𝑓𝑖𝑡 = 𝐸𝑎𝑟𝑛𝑖𝑛𝑔𝑠 − 𝐸𝑥𝑝𝑒𝑛𝑠𝑒𝑠
Profit expenses (= value of all services consumed in the
period).

Refers to the ratio of profit for the period to average 𝑃𝑟𝑜𝑓𝑖𝑡

Return on 𝑅𝑂𝐼 =
investment capital employed by the company. ∅ 𝐵𝑜𝑢𝑛𝑑 𝑐𝑎𝑝𝑖𝑡𝑎𝑙

Source: Wöhe/Döring/Brösel, 2016, S. 38

Renewable Energy Management | Seminar 1: Introduction Prof. Dr. Joern Hoppmann | 18/10/2023 | 16
Environments affecting firms and their managers

Ecological environment

Social environment

Legal and political environment

Market and technology

environment

Firms

Renewable Energy Management | Seminar 1: Introduction Prof. Dr. Joern Hoppmann | 18/10/2023 | 17
Learning objectives

At the end of the session, you should…

§ Have an overview and basic understanding of renewable

energy technologies
§ Know what management is
§ Understand important economic principles and indicators
§ Know the different environmental spheres that affect the
economic behavior and performance of firms

Renewable Energy Management | Seminar 1: Introduction Prof. Dr. Joern Hoppmann | 18/10/2023 | 18
Further information (optional)

Readings:
• Nelson, V. C., & Starcher, K. L. (2015). Introduction to renewable energy:
CRC press.
• Pettinger, R. (1994). Introduction to management: Macmillan International
Higher Education. Chapter 1.

Videos:
• Renewable Energy 101 | National Geographic:
https://www.youtube.com/watch?v=1kUE0BZtTRc
• Humans and Energy: Crash Course World History 207:
https://www.youtube.com/watch?v=EM1IyIyr-Zc
• Definition of Management:
https://www.youtube.com/watch?v=_OBqwhYLEJo
• Efficiency vs. Effectiveness:
https://www.youtube.com/watch?v=hafqZZci4e8

Renewable Energy Management | Seminar 1: Introduction Prof. Dr. Joern Hoppmann | 18/10/2023 | 19