Energy Shift: Natural gas threatened by lowering energy storage prices

Plus: Wind 32% cheaper; Hydrogen potential; BP says price carbon

Hi Everyone,

I’m spending more time thinking about ‘net zero’ targets lately. Governments of various levels and some companies have set a range of targets with differences in scope, timeline and assumptions. BNEF [see hydrogen video below] says 16% of global GDP is covered by net-zero-by-2050 targets, a fraction that continues to grow. If you seen a good piece that nicely summarizes these, please send it to me. Meanwhile, this article may be of interest: The right way to measure carbon emissions | Economist.

I provide a few key points about the characteristics of Gen Z. Worth considering the implications for energy and climate.

The BNEF talk on hydrogen is worth watching. It offers a great primer on where the technology is at, compares its costs to other sources of energy and steps through the barriers that need to be resolved.

Hope you find the rest interesting as well. And do forward this on to others you think may be interested and encourage them to subscribe.

Thanks and have a great week!
Peter

Societies change their minds faster than people do | Economist

Excerpt: Over time, public opinion has grown more liberal. But this is mostly the result of generational replacement, not of changes of heart. Social activists devote themselves to changing people’s views, and sometimes succeed. In general, however, battles for hearts and minds are won by grinding attrition more often than by rapid conquest.

Comment: I’ve heard and read about the values shift we’ve seen represented in millennials. It is now important to consider the values set held by post-millennials and how it shapes their choices. Gen Z has some important characteristics to pay attention to as it relates energy and climate change (see McKinsey: ‘True Gen’: Gen Z and its implications for companies):

their search for truth and a desire for less confrontation and more dialogue
the freedom they feel to speedily mobilize around ethical causes
the origins of products they use, living pragmatically with more emphasis on access than ownership

BNEF Talk: Hydrogen – High Hurdles, Huge Potential

Huge Battery Investments Drop Energy-Storage Costs Faster Than Expected, Threatening Natural Gas | Forbes

Comment: I haven’t beat this drum in a while, so will repeat what I’ve said before: renewables, particularly solar + energy storage is a winning combination at utility, commercial and residential scales, especially when you add in smart software. Price declines of both technologies, combined with advancements in software are making this a competitive option in many markets. Battery costs are down more than 80% in nine years and battery manufacturing capacity has increased more than 200-fold in 15 years.

And note I didn’t say ‘batteries’. I said ‘energy storage’. Storage can come in many forms, so for those new to this, also think about large tanks of fluids represented by flow batteries, pumped hydro, compressed air and others. Certainly not just lithium ion for batteries too – there are several other chemistry’s being deployed at scale. For their part, battery costs are down more than 80% in nine years and manufacturing capacity has increased more than 200-fold in 15 years [BNEF].

Some recent proof points:

World’s Largest Storage Battery [2.5 GWh] To Replace Gas Peaker Plants In Queens |
CleanTechnica
Softbank’s SB Energy among investors in US$30m Series C for ‘all-iron’ flow battery | Energy Storage News
AGL signs huge battery storage deal, hails “dawn of battery age” | RenewEconomy
CleanCo marks first day by switching on pumped hydro to meet solar duck curve | RenewEconomy
Bullard: How a Battery Can Lead a Quiet Revolution | BloombergNEF

Excerpt: RMI’s “Breakthrough Batteries” report anticipates “self-reinforcing feedback loops” between public policy, manufacturing, research and development, and economies of scale. Those loops will drive battery performance higher while pushing costs as low as $87/kWh by 2025. (Bloomberg put the current cost at $187/kwh earlier this year.)

“These changes are already contributing to cancellations of planned natural-gas power generation,” states the report. “The need for these new natural-gas plants can be offset through clean-energy portfolios (CEPs) of energy storage, efficiency, renewable energy, and demand response.”

New natural-gas plants risk becoming stranded assets (unable to compete with renewables+storage before they’ve paid off their capital cost), while existing natural-gas plants cease to be competitive as soon as 2021, RMI predicts.

Put a price on carbon and watch emissions fall, BP’s Bob Dudley says | CNBC

Excerpt: And a separate report, from Canada’s Ecofiscal Commission (EC) — an economic research organization — explored how carbon pricing measures had been implemented globally. It claimed that a cap-and-trade model implemented by 10 U.S. states in 2009 resulted in a 20% decline in emissions from electricity between 2012 and 2019. It also found that a carbon tax introduced in British Columbia, Canada, in 2008 had reduced the use of gasoline and natural gas in the province by 7% per person.

Cummins joins push for hydrogen fuel-cell semis with demonstrator | Green Car Reports

Excerpt: While Cummins’ concept truck may only have a range that caps out around 25 percent of a diesel-powered equivalent, a scaled-up, production version might bump that figure up significantly.

Global offshore wind prices drop 32%: BloombergNEF | Utility Dive

Excerpt:

Global benchmark prices for offshore wind have plunged 32% in the past year and 12% in the last six months, according BloombergNEF’s latest analysis released Tuesday.
Benchmark prices hit $78/MWh for the second half of 2019, largely driven by cheaper equipment costs, according to analysts. Meanwhile, onshore wind and solar prices have dropped 6% and 11% respectively since the first half of 2019, hitting global benchmark prices of $47/MWh and $51/MWh. Battery storage prices also fell 35% in the past year, hitting a global average of $186/MWh.

Other headlines of interest…

Solar (& Battery)

Tesla Unveils Latest Version of Solar Roof While Dodging Big Questions | Greentech Media
Amazon announces 265 MW in new solar, wind as part of 100% renewables pledge | Utility Dive
Clean Energy Deal Tracker: This corporate renewable thing is kind of a big deal | GreenBiz
Distributed Solar Development Raises $250M Fund to Support Projected Solar Growth Next Year | Business Wire

Wind (& Battery)

Wind power developers upbeat about Alberta despite end of power project auctions | JWN Energy
Largest planned wind farm in US gets key federal approval [>2500 MW]| Utility Dive
Germany may lose 40% of wind jobs as projects grind to halt | BNN Bloomberg

Transport

NSW unveils plan to switch Sydney’s 8,000 buses to all-electric | The Driven
VW ramps up China electric car factories, taking aim at Tesla | Reuters
Honda will sell only electric and hybrid cars in Europe from 2022 | CNN
UK regulatory hits back at The Guardian over EV roll-out in OP-Ed | Current
Teck Resources rolls out electric buses at B.C. coal mines | JWN Energy
MIT uses shadows to help autonomous vehicles see around corners | TechCrunch

Transition

Four in five EU coal plants are unprofitable, can’t compete with renewables | RenewEconomy

Circular Economy

BP to test technology to recycle plastic bottles again and again | Reuters
Paper Bottle Community: Is this the beginning of the end for the single-use plastic bottle? | edie