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Running on renewables transforming transportation through renewable technologies

MD Staff

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Worldwide, there were nearly one billion passenger vehicles and 335 million commercial vehicles on the road in 2015.  This number has been rising steadily over the past few decades, fueled by rising economic growth around the world. In China alone, more than 21 million passenger cars were sold in 2015, up from only 6 million in 2008.

The transport sector is responsible for a third of global energy demand and one-sixth of global greenhouse gas emissions.  It is also the sector with the lowest penetration of renewable energy: in 2016 only 4% of energy consumption in the transport sector came from renewables.

Today, as part of the Eighth Session of the Assembly, IRENA held a high-level Ministerial Roundtable to explore the links between an increasingly electrified transport sector and accelerated renewable energy deployment, with a view to scaling up the use of renewables in e-mobility.

Members were clear about the importance of a platform like IRENA to the endeavor.  As H.E. Taro Kono, Minister for Foreign Affairs, Japan put it, “The IRENA Assembly gives Japan a chance to adopt innovative solutions to engage the advanced technology and power of our innovation to address renewable energy.”

Despite its low starting point, there are reasons to expect renewables to comprise a larger share of the transport fuel mix in the future.  According to IRENA’s The Renewable Route to Sustainable Transport: A working paper based on REmap, between 2015 and 2016, the number of electric cars sold doubled (to around 1% of total car sales).  Today, one out of every five cars sold in the Netherlands and Norway is an electric vehicle, and countries including China, France, Germany, India and the United Kingdom are setting electric mobility targets.  China has announced an obligatory target of 10 percent EVs in total car sales by 2019, potentially representing a huge proportion of all new car sales.  Rapid technological progress is leading to longer ranges on a single charge, faster charging times, and cost competitiveness with conventional cars.

Zhu Guangchao, Vice Chief Engineer, State Grid Corporation of China provided participants with an overview of the vastness of the Chinese power grid.  China’s new hydro, wind and solar projects have transmitted more than 90TWh to centers across the country.  At the end of 2017, China’s wind and energy installed capacity was 215GW, contributing to a 36% share of renewable energy in China’s mix at the end of the year.  China is now also building the world’s largest fast smart charging grid, with 170,000 charging ports.  These ports will integrate real-time data, price comparisons, and will use big data to enable real-time maintenance and response support.

As Mr. Guangchao put it, “Not only is China massively scaling-up its deployment of renewables, but also replacing coal, oil and gas powered facilities and industries with electricity.” – Zhu Guangchao, Vice Chief Engineer, State Grid Corporation of China

In a 2017 KPMG survey of over 1000 automotive executives from around the world, most agreed that the strong influence on the market exerted by the Paris Agreement could cause the share of electric mobility to rise to up to 30% of global automotive production by 2023.

Renewables, which are now cost-competitive with conventional fuels in many contexts, are well poised to generate the electricity needed for this.  Indeed, IRENA’s REmap reports show that renewables could as much as quadruple within the transport sector by 2030 and go even further by mid-decade.  This is driven by a strong business case for renewables, with private sector companies leading the way in many cases.  Or, as Thierry Lepercq, Vice-President Innovation, Research and Technology, ENGIE put it, “Electric mobility is not just a vision, it’s business. We’re making money.”

Although early signs are promising, some challenges remain.  For one, the infrastructure to power electric vehicles at scale is not yet fully developed.  Charging technologies are not yet standardized, charging times are either too long to be widely practicable (conversely, ultra-fast charging technologies are expensive and energy intensive), and the impact of widespread charging on electricity loads and infrastructure is likely to exacerbate system stress.

Frederic Busin, Senior VP Development Customers and Services, EDF, summed up the challenges of adapting smart charging to the future needs of the electric mobility system, “By 2025 France will have nine million electric vehicles on the road.  That means that 30GW of power that could be used at peak hour, which is 25% of current usage.  We need to have terminals that are 100% automated in order to manage this demand.”

Improved battery technologies will thus play a critical role in the future potential of electric vehicles, and on the ability of renewables to provide the required energy.

Driven by technology improvements and rising demand, battery electricity storage systems have been growing exponentially in recent years.  This has led to rapid cost reductions.  In Germany, for instance, household-scale lithium-ion battery costs have fallen by over 60% since the end of 2014.

Better batteries will not only improve vehicle ranges between charges, but they will also help integrate higher shares of variable renewable power by providing the requisite flexibility to balance supply and demand (Electricity Storage and Renewable Energy: Costs and Markets to 2030, IRENA).  So-called vehicle-to-grid (V2G) technology, which allows car batteries to support and interact with renewables-based power systems, holds tremendous promise.  With V2G technology, electricity not only flows from the grid to the EVs to charge them, but it can also flow from the EV injecting electricity into the grid.

Delegates highlighted an interesting convergence of renewables with digital technology and artificial intelligence, “Autonomous driving is a major driver of electrification.  A new systems-driven transportation paradigm is emerging where you don’t own cars but summon autonomous ones.”, as Martin Keller, Director, NREL put it.  The future of our cities is emerging, with full, electric autonomous mobility.  Those changes are driven by affordable electric mobility today.

One thing that is certain is that e-mobility can significantly contribute to reducing local air and noise pollution.   IRENA’s analyses indicate that if air polluting emissions from conventional vehicles—nitrous oxide, volatile organic compounds, and others—were valued by their impact on human health and agricultural crops, external global costs from use of fossil fuels in the transport sector would be in the range of USD 460 billion to USD 2.4 trillion per year, based on 2010 data.

IRENA Director-General Adnan Z. Amin reminded participants that the business case for renewables is inescapable, and that the global conversation is no longer about Global North and South, about ODA, or about building new technology.  The technology is available, private sector investment is happening, and policies exist. All that’s needed is to put them together in the right way and, as we have seen with many countries where renewables are taking off, significant change will happen.

In closing, the IRENA Director-General reminded delegates, “The energy transformation will not be a simple, linear thing. We must create the pool of knowledge, expertise and understanding so that all countries can make an informed choice about their energy future.”  Global platforms like IRENA are vital to this process.

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Energy

Potential of Pakistan’s Power Sector

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A few years ago, several hours of load-shedding in Pakistan was very common, even in Islamabad, the capital of Pakistan was without electricity for 6 hours on daily basis. Thanks to CPEC, thanks to China, who has completed several power projects and the people of Pakistan are relieved a lot. Now there is still load-shedding but only for couple of hours. The country was able to produce 16000 MW of electricity in the 7 decades almost. And most of the mega projects were completed in 1960s or 1970. Last 4 decades the nation was unable to add any significant amount of power into national grid.

China helped Pakistan to over-come its power shortage and just within few years, under CPEC, the country was able to add 11000 MW of power into National Grid. There are several power projects under execution or in the pipe line. It is believed, that next couple of years and we may get rid of load-shedding absolutely. However, it is also expected that due to planned industrialization, the demand may also increase tremendously. We still need to focus on the power generation, transmission and distribution. As the transmission is rather old and line losses are rather high. There is a need to up-grade our transmission system on urgent basis. The major issue is still the distribution, which resulted in theft of electricity. Line losses and theft made electricity rather expensive as it has to be recovered from consumers.

However, Pakistan possess potential of 65000 MW hydropower generation. Some of the sits are natural dams and suits for electricity production easily. Building big dams or mega dams, require a lot of investment as well as technical expertise too. But, small dams are easily constructed by our private sector. The requirement of investment is within the reach of our private sector and the technology required is also available within the country.

Dams also store water which will be additional value for Pakistan. As Pakistan is a country which faces water related disaster twice a year. During the rainy season, heavy rains causes flood every year and damages our crops, cattle’s, villages and loss of human live. Floods cause spread of seasonal diseases and epidemics also cause a big loss to nation. Just after a few month, Pakistan faces drought season too. During the drought season, water shortage cause big damage to human life and animals’ and husbandry. Crops suffered heavy losses due to shortage of water.

If appropriate dams are built, it may generate power to meet the national requirements as well it stores water during rainy season to avoid floods and utilize water during the drought season. We can overcome some of our serious problems by indigenous technology and domestic resources, without going to International donors.

Usually building big dams requires a long time 10-15 years, but our political system is based on 5 years tenure term. Most of political parties do not initiate any project, which cannot be completed within their tenure and they get benefits of completed projects during the election. As a practice, most of political parties never takes any initiatives, which may goes to credit of next government. But recently, Pakistani voters have become matured and they understands the worth of long term projects and may vote for those who are visionary leaders and sincere with Pakistan, and take long tern initiatives for the best interest of the nation. Our political parties may also up-date their strategies accordingly.

Not only hydropower, even Pakistan is rich with coal. Only Thar coal can meet the nation’s energy requirement for next 500 years. Coal technologies are on its path of rapid development. There exists technologies to convert coal into natural gas, or diesel. Coal can also help the whole downstream hydrocarbon industry too. Clean coal technologies are already applied in the field. Pakistan can be major beneficiary of its coal reserves.

God has blessed Pakistan with unlimited solar energy. There are areas in Pakistan, where the Sun shine duration is above 300 days in a year, and upto 18 hours of Sun shine on daily basis. This unique potential may be exploited for green and clean energy. Wind is also one of our strength.

What do we need? An enabling policy from Government of Pakistan. The policy may be focused to attract local entrepreneurs based on incentives. Sustainable and long term incentives, and protection may be the priority of Government. Our private sector possess the potential of rapid growth. It may include International market too. But the indigenous know-how and domestic investment may be given priority.

If PTI government can deliver something like this, their next elections are guaranteed to win.  As per my perception, Imran Khan, the prime minister of Pakistan has vision, has will and sincere with the nation, based on our understanding, we expect he will take serious notice of things and include power sector in its priority too.

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Back to the future

Laszlo Varro

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In the classic Back to the Future movies, the future was powered by a decentralized clean-energy system. Houses and flying cars ran on fuel cells fuelled by residential garbage. The technology itself isn’t particularly far-fetched – not the flying car bit, but the process to power a fuel cell from hydrogen produced by methane from garbage is relatively straightforward for today’s biogas plants.

But time travel aside, what the 1980s vision of the future missed are the actual technologies that emerged started to reshape our energy system in the last three decades since the movies came out – namely wind, solar and battery electric cars. While the present of the energy system is strikingly similar to the 1980s with a practically unchanged domination of fossil fuels, the expectations of what will follow shifted. This is a very different future and one that creates a delicate challenge for the electricity sector.

Transport is a huge and growing energy consuming sector. It represents 28% of total final energy consumption, and is responsible for almost 60% of global oil demand. Electricity is used in transport, though today mostly in electric railways compared to which electric cars are still minor.

If garbage, or, in a more scalable fashion, biomass or hydrogen produced from natural gas, were to provide a clean-energy alternative for transport, the transport sector could move away from oil without integrating more deeply into the electricity sector. There would be no need to deploy new infrastructure to support electric car charging, no concerns about charging times and impacts on power flows, it would be business as usual for electricity.

In addition, garbage is easy to store, and fuel cells can regulate their production in a flexible fashion. In technical terms this creates decentralised dispatchable clean-energy production – meaning it can collect power into a central system, much like the current system. Such a technology would enable the continuation of a hundred-year paradigm of regarding electricity demand fluctuations as a given and managing the system from the supply side.

But, this market is tiny. Only a few thousand residential fuel cells are sold in Japan each year, nothing compared to the millions of solar panels sold around the world. To be sure, solar production varies with the weather and it is often not well correlated with demand. A solar rooftop with a battery in the garage seems like a perfect distributed dispatchable solution and generates increasing attention. However, more than 99% of the solar panels are deployed without batteries – their variability is handled at the system level rather than at a project level. In fact the optimal location is of batteries is often not next to the solar panel but in specific network nodes where their operation can relieve bottlenecks.

Solar and its twin brother, wind experienced a radical technological progress, cost declines and are rolled out at an impressive scale. While the energy system will continue to rely on a diversified set of fuels and technologies, the rapid growth of wind and solar will have to play a key role in tacking  disruptive climate change. Nevertheless, both of them generate electricity which accounts for only 20% of energy consumption today.  The full potential of wind and solar will be realised only if a much higher proportion of energy is consumed by electrifying other sectors, including transport. Such electrification not only reduces direct fossil fuel use in vehicles or buildings, but if done smartly it unlocks need new flexibility sources that wind and solar will need for really large-scale growth.

The transport technology that generates the most excitement is electric cars. Although personal cars represent only a minority of the oil use of the transport sector, electric cars capture public imagination in a fashion that is disproportional to their energy footprint. As a result, they tend to dominate discussions on the future of energy even though ships, aircraft or heavy trucks are most likely to continue to use oil for a considerable time. Linking electric cars to wind and solar creates major opportunities but also challenges. Cars and wind and solar production will need to interact through an interconnected system. An EV can’t be self-sufficient when coupled with a residential rooftop solar panel since solar production is low in the winter precisely when the car has a higher electricity need. In temperate climates, nearly all solar households remain connected to the grid with a changed utilisation pattern and wind is evolving towards a quintessential utility scale big business where technological progress makes wind turbines bigger and bigger rather than small and decentralised.

While early adopter electric cars used in suburban commuting can take advantage of the existing network and charge in the garage of the owner for mass adoption and long distance travel a new infrastructure development will be needed. High capacity chargers will require network reinforcements as well as a careful coordination of when the cars charge. Due to the energy density of hydrocarbons, it is not possible to copy the gasoline lifestyle to the electricity age. Plugging in and quickly filling the car at sunset will be part of the problem, responding to changes in wind with smart charging will be part of the solution.

A dominant role of electricity is not a new dream. The 19th-century science fiction novels of Jules Verne are full of electric cars, battery powered submarines and even electric helicopters. This electric future was delayed by the century of oil, but it is now arriving. Its features are becoming increasingly clear: A new electricity network that is more robust and more flexible at the same time. A new market design that is able to orient and optimise millions of producers, consumers and prosumers giving value to time and location. A new transport system where parking vehicles are not idle but act as active system assets.

Because of its security implications and importance to modern society, electricity will remain a heavily regulated industry where government policy plays a crucial role in guiding the transformation. This complex interplay of technology, investment, policy and regulation shaping the growing role of electricity will be depicted in the upcoming World Energy Outlook focus. In special effects, it might not be up to Hollywood’s standards, but it will be as exciting and innovative.

IEA

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Israel’s Gas Ambitions are Valid but Challenges Remain

Antonia Dimou

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The discovery of Israel’s natural gas resources promise important benefits of energy security and economic gains. Israel is a leading country because preparations to extract gas are already at advanced stages despite that its gas fields’ development has proved to be a lengthy process.

Delays are attributed to the fact that the fields’ development is capital intensive and entails risks that unsettle investors. A major risk is the lack of energy transportation infrastructure in Israel. Leviathan field partners namely Noble Energy, Avner Oil Exploration, Ratio Oil Exploration and Delek Drilling are likely to develop infrastructure used exclusively by Leviathan, blocking out competitors and endangering prospects for future gas discoveries in Israel. In particular, the likelihood that competitors will have to finance their own transportation infrastructure, raises the costs of developing smaller fields at prohibitive levels. Concurrently, the Israeli Leviathan field’s development, the largest exploration success since December 2010,is capital intensive given that it requires significant investment that will be carried out in two stages: the first stage foresees four development wells with an annual capacity production of 12 billion cubic meters (bcm) of gas, and, the second, four additional wells that would increase production capacity by another 9 bcm.

In regional terms, Israel’s efficiency as a gas exporter is significant. This is evidenced by the signing in early 2018 of two agreements valued $15 billion between Leviathan and Tamar fields’ consortium and Egyptian company Dolphinus Holdings for the provision of 64 bcm of gas over a ten-year period. The agreement are expected to produce three benefits. First, Egypt is a viable export market for Israeli gas and will thus generate interest from foreign energy companies to bid for licenses in future Israeli international auction rounds. Second, the Israeli government would benefit financially from royalties on sales and taxes on profits. Third, Leviathan partners will secure funding for the field’s development.

Reservations however subsist when it comes to the transportation of Israeli gas to Egypt via the existing pipeline infrastructure in Sinai as terrorist attacks on the pipeline could halt exports from Israel as it happened in 2012. The prospect of terrorism raises the cost of the Israeli fields’ development because of the increased risk premium. It is in this spirit that the construction of a subsea gas pipeline that connects Israel to Egypt could present a safer option. In any case, transportation of Israeli gas to Egypt is not only a milestone in regional gas cooperation, but also supports authentic Israel-Egypt normalization.

Israeli government interference in the form of heavy regulation and bureaucracy is a self-inflicted wound that prevents foreign energy companies from participating in bidding processes. Despite the approval of a revised framework for gas regulation by the Israeli government,  the first Israeli bidding process received limited attention taking into account that only a Greek energy company and a consortium of Indian companies participated. Notably, the main outlines of the revised gas regulatory framework included the mandatory sale by Delek Group Ltd, Avner Oil & Gas LP and Delek Drilling LP of all their rights in the Israeli Tanin and Karish fields that are currently owned by Greek Eneregan Oil & Gas Company; and, a stability clause which foresees that the Israeli government guarantees regulatory stability for ten years.

On a parallel level, overlapping maritime claims between Israel and Lebanon over a 854-square kilometer maritime boundary carry the risk of escalation. The January 2018 signing of Lebanon’s first exploration and production agreement (EPA) with a consortium of companies led by French Total as operator, and Italian Eni and Russian Novatek as partners signals competition that could evolve into confrontation over energy resources. Undoubtedly, in the absence of mutual diplomatic recognition between Lebanon and Israel, no trans-boundary natural resource sharing initiative can be taken. The consortium’s announcement that no operation within 25 km of the disputed area will happen leaves room for a third party mediation to minimize the risk of armed conflict and to work on reciprocal acceptance of the 2012 American proposal so that consensual and authorized economic activity becomes feasible. Noteworthy, the 2012 American proposal involved division of the disputed area granting Lebanon a larger share with the aim to serve as basis of bilateral discussions and be deposited with the UN.

To fulfill its energy potential, Israel should speedy proceed with the supply of gas pumped directly from the Leviathan and Tamar fields to LNG plants in Egypt as this will benefit both Egypt’s natural gas industry and development of Israeli fields.  Israel should also invest in security of its energy supply to refute the notion of insecurity that prevents foreign energy companies from investing in the country’s gas fields. Equally important, risks that concern investors like export sustainability should be addressed by guaranteeing a certain amount of financial recovery though the existing compensation mechanism. A transparent and predictable Israeli regulatory environment for foreign investors and access to external sources of project finance and loan guarantees and production commitments in Israel are important for the development of export oriented gas resources.

Unquestionably, decisive steps have to be taken by Israel so that a new horizon is revealed; the horizon of indigenous energy development.

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