The Changing Energy Landscape

David Auston,
Executive Director
The Institute for Energy Efficiency

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U.S. Energy Consumption 2011

Source: U.S. Energy Information Agency (EIA)
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China Energy Consumption 2009

Source: U.S. Energy Information Agency (EIA)
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Energy Use Per Capita by Country

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U.S. Energy Use per Capita and per GDP

Source: U.S. Energy Information Administration | Annual Energy Outlook 2013

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U.S. Primary Energy Consumption by Fuel (1015 BTU)

U.S. Energy Information Administration | Annual Energy Outlook 2013
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U.S. Electricity Generation by Fuel (1012 kWhr/yr)

Source: U.S. Energy Information Administration | Annual Energy Outlook 2013
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U.S. Projected GHG Emissions

Source: U.S. Energy Information Administration | Annual Energy Outlook 2013
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Unconventional Oil
Energy Bonanza or

& Gas –
Environmental Hazard?

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Assessed Shale Oil and Shale Gas Formations (2013)

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U.S. Domestic Natural Gas Production (1012 cubic feet)

Source: U.S. Energy Information Administration | Annual Energy Outlook 2013
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U.S. Domestic Crude Oil Production (106 barrels/day)

Source: U.S. Energy Information Administration | Annual Energy Outlook 2013
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Technically Recoverable Unconventional Oil & Gas

38%

48%

Increase in U.S. natural
gas supply due to
unconventional sources

Increase in non U.S.
natural gas supply due to
unconventional sources

35%

10%

Increase in U.S.
petroleum supply due to
unconventional sources

Increase in non U.S.
petroleum supply due to
unconventional sources

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Net Oil & Gas Imports in Selected Countries

Source: U.S. Energy Information Administration | Annual Energy Outlook 2012
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Geopolitical Impact of Unconventional Oil & Gas
Combats the long-term potential monopoly power of a “gas OPEC”
Reduces U.S. and
Chinese dependence
on Middle East natural


Virtually eliminates U.S. requirements for
imported LNG for at least two decades
Reduces competition for LNG supplies from
the Middle East

gas supplies
Reduces the future

share of world gas

supply from Russia,

Iran, and Venezuela

Reduces the opportunity for Venezuela to
become a major LNG exporter
Reduces Russia’s market share in non-FSU
Europe from 27% in 2009 to ~13% by 2040
Reduces Iran’s ability to tap energy diplomacy to
strengthen regional power or buttress nuclear
aspirations

Source: Baker Institute for Public Policy 2010
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Methane Leakage & Global Warming Potential (GWP)

GWP is a measure
of the total energy a
gas absorbs over a
period of time
compared to CO2.

Source: World Resources Institute 2013
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Groundwater Contamination

Methane was detected in 82% of
drinking water samples from 141
wells in Appalachia, with average
concentrations six times higher
for homes <1 km from natural
gas wells:
“Increased stray gas abundance in a
subset of drinking water wells near
Marcellus shale gas extraction”, Robert B.
Jackson, Avner Vengosh, Thomas H.
Darrah, Nathaniel R. Warner, Adrian
Down, Robert J. Poreda, Stephen G.
Osbornd, Kaiguang Zhao, and Jonathan
D. Karr, PNAS July 2013

Growing & Changing Share of World Energy Demand
+35% 2010 to 2035

Source: U.S. Energy Information Administration | Annual Energy Outlook 2012
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Carbon Intensity --- a Measure of Clean Energy

CHINA
USA
WORLD

EU-27

INDIA
AFRICA

SOURCE: IEA: “Tracking Clean Energy Progress 2013”

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Reaching the 2 Degree Climate Scenario

Source: IEA “Tracking Clean Energy Progress 2013”
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Electricity Generation

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U.S. Electricity Generation by Fuel

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Levelized Cost of New Electric Power in U.S. ($/kWh)
Hydro
Solar Thermal
Solar PV
Wind-Offshore
Wind
Biomass
Geothermal
Advanced Nuclear
Advanced Combustion Turbine
Conventional Combustion Turbine
Advanced CC with CCS
Advanced Combined Cycle
Conventional Combined Cycle
Advanced Coal with CCS
Advanced Coal
Conventional Coal

Note: These are costs
for new generation
that would come
online in ~2018;
exclusive of subsidies

Renewables
Nuclear
Gas Fired
Coal fired

$0.00 $0.05 $0.10 $0.15 $0.20 $0.25 $0.30
Source: US Energy Information Agency

Cost / kWh
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c-Si PV Manufacturing & Cost Trends

Goodrich et al:
“Assessing the
drivers of
regional trends
in solar
photovoltaic
manufacturing”

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WIND ENERGY

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Wind & Solar Power Variability (30 days)

Wind
Solar
Demand

Barnhart et al: “The energetic
implications of curtailing versus
storing solar- and wind-generated
electricity”

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Real Time Electricity Pricing

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Variable & Fixed Costs of Generating Electricity ($/MWh)
Hydro
Solar Thermal
Solar PV
Wind-Offshore
Wind
Biomass
Geothermal
Total Fixed Costs

Advanced Nuclear
Advanced Combustion Turbine

Variable O&M
(including fuel)

Conventional Combustion Turbine
Advanced CC with CCS
Advanced Combined Cycle
Conventional Combined Cycle
Advanced Coal with CCS
Advanced Coal
Conventional Coal
0

50

100

150

200

250

300 $/MWh
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Thermal Efficiency – Coal versus Gas

CCGT: Combined Cycle Gas Turbine
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Sources of Air Pollution in the U.S.

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Coal-Fired Power Plants & Range of Toxic Emissions

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“The Toll from Coal”, Clean Air Task Force 2010

Damages from Coal-fired Power Plants (cents/kWh)

Source: “The Hidden Costs of Energy”, NAS 2010
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New Federal Regulations on CO2 Emissions
The US EPA issued a new rule that will limit emissions of CO2 to 1,100
lbs/MWhr of production from NEW coal-fired power plants (current
“advanced” coal plants emit ~1,800 lbs/MWhr) in September 2013

39% reduction

President Obama has ordered the EPA to issue final greenhouse-gas
rules for EXISTING plants no later than June 2015.
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Projected Additions to U.S. Electric Power Capacity

Source: EIA 2012

GW

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Carbon Capture & Storage

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Source: WRI

How Carbon Capture Works

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Added Capacity in Electric Power Generation 2010-35

“The need for electricity in emerging economies drives a 70% increase in
worldwide demand, with renewables accounting for half of new global
capacity” : International Energy Agency World Energy Outlook 2012
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Some (Speculative) Trends re Electricity Generation
• Renewable sources of energy, especially wind and solar will continue to
grow, but will remain a relatively small fraction of total electrical energy for
the next decade or two.
• Natural gas will provide strong price competition for renewable sources and
nuclear power both because of the increased supply and its low ratio of
fixed to variable costs.
• Although unlikely, a carbon tax would substantially accelerate the transition
from fossil fuels to renewable sources of electricity.
• Natural gas will gradually replace coal in the U.S. assuming methane
leakage and groundwater contamination can be properly managed. This
transition will be accelerated if the EPA succeeds in imposing new
regulations limiting GHG emissions.
• Large organizations (e.g. Oracle, eBay, Goggle, UC) will increasingly
purchase and/or build their own sources of electricity.
• Global trends and their impact on climate will be dominated by the
developing countries, especially China and India.
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TRANSPORTATION

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Light Duty Vehicle Mileage Standards (mpg)

miles
per
gallon
(mpg)

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Only 20% of Energy Propels the Average Gasoline
Powered Light Duty Vehicle

Source: IEA “Tracking Clean Energy Progress 2013”
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Electric vs Conventional Internal Combustion Engine (ICE) Vehicles

Source: US Energy Information Agency; McKinsey Analysis
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Cost of Ownership – Honda Civic Gasoline, CNG, HEV

Cost ($)
per mile

Source Bloomberg - Sustainable Energy in America 2013 Factbook
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Car Incremental Cost versus 2010 Baseline
($26,341 Retail Price)
Legend
FCV = Fuel Cell Vehicles
BEV = Battery electric Vehicles
PHEV = Plug in Hybrid Electric Vehicles
HEV = Hybrid Electric Vehicles
CNG = Compressed Natural Gas
ICE = Internal Combustion Engine
Incremental
cost ($)

Source: Transition to Alternative Vehicles and Fuels – NAS 2013
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LNG --- Heavy Duty Vehicles

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America’s Natural Gas Highway

Source: Clean Energy

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STORAGE – THE BIG CHALLENGE

An artist's rendition of A123 Systems battery systems at a wind farm. (Credit: A123 Systems)

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Storage Technologies Capital costs ($/kW)

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Beyond Li-ion Storage Concepts
electrons

Non-aqueos Redox
Flow

ions

Multivalent
Intercalation
• Li+  Mg++, Y+++, . . .
Double or triple energy stored and released

Chemical
Transformation

Intercalation  chemical reaction
Li-O2, Li-S, Na-S, . . .

Flowable electrodes


solutions or suspensions
no structural constraints
rich horizon of unexplored redox
couples
Low cost / high capacity
organic
materials

All atoms store and release energy
Source: JCESR

Highest potential, least understood opportunities
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California Energy Storage Procurement Targets (MW)
California
Investor Owned
Utility (IOU)

2014

2016

2018

2020

Total

Southern
California Edison

90

120

160

210

580

Pacific Gas &
Electric

90

120

160

210

580

San Diego Gas &
Electric

20

30

45

70

165

Totals

200

270

365

490

1,325

Source: CPUC Rulemaking 10-12-007
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Some (Speculative) Rends re Transportation
 Hybrid electric vehicles will become more widely deployed as
new mileage standards are implemented.
 Liquified natural gas will become more widely used to power
heavy duty vehicles. However, compressed natural gas is
unlikely to be used widely in light duty vehicles.
 Without continued subsidies and or a carbon tax, hybrid and
fully electric light vehicles will not become cost competitive with
internal combustion vehicles for two to three decades
 Low cost efficient energy storage, both for transportation and
the electric grid, remains the single most important
technological challenge limiting the widespread deployment of
renewable energy and electric vehicles.
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Thanks to Claire Dooley for help preparing the slides and Jen
McJannet for a critical reading of the talk.

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Some (Speculative) Concluding Remarks
• The recent development of unconventional sources of oil and gas will spur
the continued use of fossil fuels.
• The U.S. will become less dependent on imported sources of energy.
• Renewable sources of energy, especially wind and solar will continue to
grow, but will remain a relatively small fraction of total electrical energy for
the next decade or two.
• Natural gas will gradually replace coal in the U.S. assuming methane
leakage and groundwater contamination can be properly managed.
• Natural gas will become more widely used to power heavy duty vehicles,
but is not likely to impact light duty vehicles.
• Low cost efficient energy storage, both for transportation and the electric
grid, remains the single most important challenge limiting the widespread
deployment of renewable energy and electric vehicles.
• Although the U.S. has the capacity to comply with the 2 degree scenario, it
is much more challenging for China and India to do so.
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Total U.S. Energy Production & Consumption (1015 BTU)

Source: U.S. Energy Information Administration | Annual Energy Outlook 2013
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Carbon Intensity --- a Measure of Clean Energy

Source:
shrinkthatfootprint.com

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Per Capita GHG Emissions by State

SOURCE: The Vulcan Project, ASU

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US Energy Efficiency Supply Curve 2020 (McKinsey)

$13.80 /
MMBTU

The average cost of these end-use energy savings is $4.40 /
MMBTU: 68% below the weighted average across all fuel types.

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Levelized Cost of New Electric Power in U.S. ($/kWh)
Hydro
Solar Thermal
Solar PV
Wind-Offshore
Wind
Biomass
Geothermal
Advanced Nuclear
Advanced Combustion Turbine
Conventional Combustion Turbine
Advanced CC with CCS
Advanced Combined Cycle
Conventional Combined Cycle
Advanced Coal with CCS
Advanced Coal
Conventional Coal

Note: These are costs
for new generation
that would come
online in ~2018;
exclusive of subsidies

Renewables
Nuclear
Gas Fired
Coal fired

$0.00 $0.05 $0.10 $0.15 $0.20 $0.25 $0.30
Source: US Energy Information Agency

Cost / kWh
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Coal versus Natural Gas

Reuters 2012

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U.S. Electricity Generation by Fuel

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