Wednesday, December 30, 2009

An Energy mix

Let's have a look to world energy consumption, with a focus on electricity.

According to the Energy Information Administration's International Energy Outlook 2009, the world's electricity generation is expected to increase by 77% from 2006-2030. Much of this is going to take place in the developing countries where increases of per-capita income and a general rise in the standard of living is going to push up the demand for power in developing countries the world over.

Now, let's breakdown the sources/fuels from which this electricity is produced and will produce this expected, staggering increase:

Todate and in the foreseeable future, coal continues to fuel the largest share of worldwide electric power generation. In 2006 coal accounted for 41% of world electricity supply whereas in 2030 it is expected to increase to 43%(!) if the business as usual policy towards coal continues. This is disasterous news for the environment as coal fired generation emits the highest levels of carbon to the atmosphere and are a major contributor to global warming. The good news is that with using the right tools (cabon taxes) as there are tremendous opportunites for reducting CO2 and all we need is for a true price on carbon to be imposed the world over to bring into play some attractive no or low emission technologies for making coal cleaner.

Gas powered generation - natural gas is equal to only about one half the total production of coal. There are many advantages for using natural gas to produce electricity. Its efficiency, operating flexibility, short planning and construction time and relatively low capital costs. Only a few days ago, Powermag reported huge new natural gas finds in the US which should push gas powered generation in the short and mid term in the US.

Liquid fuel and petroleum - one of the least efficient, most polluting and most expensive ways to produce electric power. The expected rising price of petroleum and peak oil is going to cause a significant fall in electricity produced from petroleum both in percentage wise and in absolute numbers.

Nuclear power - nuclear power being carbon neutral (if we don't count the emissions involved in mining uranium) is going to increase in use over the coming 20 years. Development in N-power technology are showing higher capacity utilization. On the other hand, issues of plant safety, radioactive wast disposal and nuclear weapons concerns. It should be noted that the same peak oil idea that Hubbert developed for oil is also relevant for all minerals and though not often considered as such, Uranium is also a finite resource.

And now to renewables: there is little doubt that this is the fastest growing source of electricity. Therefore, the 2009 Outlook expects the share of renewables (Hydro, wind, geothermal, and other) to grow also in the percentage of the global production from 19% in 2006 (mainly large hydro) to 21% in 2030.

But, the EIA concludes with the following position which, as I discussed in the Linkedin Discussion, is fully mistaken:

"Although renewable energy sources have positive environmental and energy security properties, most renewable technologies other than hydroelectricity are not able to compete economically with fossil fuels during the projection period outside a few regions. Solar power, for instance, is currently a “niche” source of renewable energy but can be economical where electricity prices are especially high or government incentives are available."

As long as the US and other goverments do not understand the issue of negative external costs we are pretty much in a tangle. Until governments the world over do not accept the fact that current fossil fuel energy cannot continue to be subsadized by the tax payer as a way of keeping fossil fuel energy prices down and renewable energy prices high, we are not going to see a change in the numbers outlined above. Only by imposing strict emission taxes on emitters is there any hope for leveling the playing field and tipping it in favor for low emission energy.

It is time for all of us to get more involved. We must tweet, blog, e-mail, network, communicate, petition, discuss, convince, write, open support groups in facebook and elsewhere and speak to our friends, neighbours, co-workers, representatives and anyone willing to listen. It is time for us, citizens of the planet, to demand from our goverments and Parliaments to do what it takes to reduce CO2 emissions. If they don't know what to do we must propose. If they don't listen, we must replace them with those who do.

To end on a positive note, NY Times reported on 30th of December that the French Constitutional Council turned down a proposed carbon tax due to it being too lax on emitters and with too many exemptions on polluters and sent it back to goverment for revision.

There is no time to lose and there is everything to win!

Tuesday, December 29, 2009

Compulsory green energy purchases - a discussion I joined on LinkedIn

The following discussion was started in the Renewable Energy Business Network/Clean Economy Network on LinkedIn:

"What is your opinion regarding compulsory green energy purchases?
China's top legislature Tuesday discussed a legal amendment to require
electricity grid companies to buy all the power produced by renewable energy
generators. "

One of the participants posted the following comment:

"I believe in democracy and capitalism. I do not want more government and more
mandates for anyone! In my opinion, compulsory green energy purchases is a bad
idea. Instead of mandates, green energy must stand on its own because of the
value it brings to the individual, the business and the world."

This is my answer: democracy and capitalism are great. However, equal opportunity and a level playing field is just as important and the field has not been levelled for years. When businesses make millions of dollars in profit while dumping their solid, liquid and gaseous waste without accounting for it into landfills, rivers and the air, that is not capitalism. It is abuse of opportunity. It is wrong. It is injustice. This took place and in many cases is still taking place in the US and in many other places. Energy companies, large industry, utilities, are polluting, and transferring negative external costs to you and all of us. Their pollution costs money, it is a heavy burden on the health system that is financed not by the polluter but by the public. These costs have NEVER been calculated into any tax as far as I know.

We must change this and yes, compulsory purchasing of clean energy, incentives for clean energy, carbon taxes, cap and trade, polluter pays taxes and any other tool will do just this. It will force industry that uses a lot of energy or produces a lot of waste, to invest in industry that has a positive impact on the environment, i.e. renewable energy, and it will make doing business that is bad for the environment much more expensive, as it should be.

Capitalism does have room in this environment, it just needs some guidance, governmental and, more importantly, public demand from government do implement this guidance.

Sunday, December 27, 2009

Hubbert's Peak Oil - 4th post

Still working on my first podcast. I was supposed to have my first interview yesterday but it didn't work out. I am happy to report that I will be interviewing the CEO of Sovna on Sunday so stay tuned.

I am going to try to be a bit shorter in my posts. This time, about Peak Oil.

It is thought by most that the drive behind renewable energy is global warming. This is only partially true. An additional major driver of the search for renewable and alternative energies is what is know as peak oil or the end of the cheap oil era.

The idea of Peak Oil was first put forward by M. King Hubbert, an American geologist. Hubbert's thesis is that for any given geographical area, from an individual oil-producing region to the planet as a whole, the rate of oil production tends to follow a bell-shaped curve.

The idea he put forward is simple, intuative and well proven and established in practice; and yet it has been contended by so many - particulary oil companies and producers. It basically says that oil is finite (no argument here - but I can expand this point if asked). That when extracting oil, we first extract the oil that is easiest to extract, i.e. close to the surface and close by (still pretty logical). It goes on to say that about half the oil, in any given area - small or global - is shallow, near and relatively easy (and therefore cheap) to extract while the other half is deep, located in remote areas (or very deep underground) and, as a result, difficult to extract (and expensive).

This has been supported by reality. Whereas the great oil wells of Saudi Arabi (Gawahr field which is actually dying) and Texas started off as very shallow, recent finds of very large petroleum deposits, as recently reported off the coast of Brazil by PetroBras, are 10 km deep and will cost an estimated $250 billion to extract.

For years, Hubbert's Peak Oil theory was completely ignored by decision makers. No real consideration was given to how OPEC members determined their oil reserves and the numbers they gave were rarely contended. This has just very recently changed. On the 10th of December, the Economist reports that the IEA now puts peak oil at 2020!!! This does not mean that oil will run out in 2020. It does mean, however, that the price of oil will start climbing at a growing pace. This will not be the same speculation driven rise in oil prices that we saw 3 years ago. This is going to be steady, sharp and rapid as more and more citizens in developing countries will want to drive cars.

2020, to remind us all, is only 10 years away(!) and just as good a reason as global warming to incentivize, pour billions of dollars and whatever else to produce renewable energy.

Now there are two strong argument for renewable energy incentives. What will the climate change conspiracy theorists say to that...

Thursday, December 24, 2009

I have to start somehwere

So commenting on a post that appears in the Renewable Energy Business Network Group on LinkedIn seems as good a place as any. Over the past month or so I have been deeping my involvement in LinkedIn and in its groups. I have come across a few voices that are constantly trying to put forward the idea that global warming, climate change, dwindling of resources is just a concpiracy put forward by "Greenies" who have what to make from such ideas. Others, like Robert L. Tomlinson raise legitimate questions about existing renewable energy technology though in this case with a bit of an exagerated headline as follows: Solar power is not so "green" wastes millions of gallons of water.

There are so many technologies in each of the renewable energy fields. Most of them, just by the way, are essentially harvesting different forms and manifestations of solar energy (perhaps excluding GeoTh). There are horizontal and vertical wind turbines, large scale wind and small scale, onshore and off. There is PV (PhotoVoltaic) , SolTh (Solar Thermal), CPV (Concentrated PV), BIPV (Building Integrated PV), thin film, large scale and small. There is biomass energy using pyrolisis, combustion, decomposition, large scale or small, as well as different types of wave harvesting techniques, biofuel etc.

Some of these technologies are older than others. Many of them started off in universities and were then funded by governmental R&D grants, private investors and venture capital. For many years, they could not even come close to the $/kWh ratios that fossil fuel could in producing electricity. Oil was cheap, close by, shallow and in abundance. Some of these early entrepreneurs believed that the current oil age could not continue, others were scientist who could not help themselves. Some of them understood that the playing field was totally crooked and heavily tilting towards fossil fuels. The tilt, as we most deffinately know today, was that fossil fuel and fossil energy transfer negative external costs, mainly health and environmental costs, onto the public while hording tremendous amounts of profit. They weren't, for the most part, doing anything illegal. They were playing by the rules – though often then had a strong influence on formulating them as an in-depth look at the CVs of many of the Bush administration's top people will show.

And now, thankfully, the tables are turning. More and more of us, citizens of the planet, connected to each other like never before using this web, are quickly understanding that that which was till now cannot continue. We are understanding that even though we cannot destroy the world, we can definitely make it uninhabitable for us humans at a grave risk to the accumulation of wisdom that we humans have been able to produce during our relatively brief existence on it. For the first time in human history, in this time and in this generation humans actually have the capability to destroy ourselves entirely, as a race. This capability never existed in the past. Oh sure, we have always been good at killing each other but never before could we really threaten our real existance. Never could we do so much damage to the plant so as to make it uninhabitable. And humans, using technology, can do this in two general ways: by using WMDs or through poisoning and/or negatively affecting our environment to a point that it is no longer inhabitable for us.

More and more of us are also learning that oil is finite. This notion was put forward by a one of the most important geologist of our time who has yet to get full credit for his discoveries. He is M. King Hubbert and his discoveries of Peak Oil which I inetned to go into in greater depth in the near future.

And, therefore, the race is on. The race to stop doing damage and, hopefuly, to start reversing the damage that has already been done by use of fossil fuel coulpled with the race towards the day that oil will run out.

It is true, in the process of doing damage and using oil we have improved the quality of living of most of us Western hemisphere global citizens - those with capability, if not interest - to reach this blog. It is, however, arguable that the majority of the citizens of the planet have benefited from the petro-chemical revolution that started around 100 yearsr ago. Recent numbers tell us that one quarter of the world's popultion are living in the same conditions as their ancestors lived in 6000(!) years ago! Now, I want to put it forward that I am not a Luddite. I don't want to destroy what we have done. I do, however, want to look at the things as they are and muster up human inginuity, innovative thought, will power, determination and intelligence to ensure that my kids and theirs will have a place to stay. I am quite certain that with a "business as usual" this will not be the case.

Now back to the technologies. I think that what is so exciting about these times is that for the first time, a true and deep look into all manufacturing process is taking place. New standards are being developed. Exteral impact, carbon footprint, cradle2grave approaches, full life cycle etc. This is totally new and will affect EVERYTHING! Every manufacturing process, every product and service, every sector. It is going to involve regulatory steps, taxation, profitability, employment, full industries, the works. It is also going to create new opportunities and, probably most importantly, it is going to level the playing field.

I admit, most technologies are not perfect. A lot of time and effort is being put to improve them. The market - yes that capitalist one - is still playing its roll and will chose the best, most competitive, most efficient and those that are not will not succeed. Some use too much water and others too many chemicals. Some produce too much carbon in the manufacturing process etc. But, nearly all of them come with the same goal of producing clean renewable, sustainable energy and they should be getting all the help they can.

And, btw, those who don't agree with me, and there are some, don't waste your breath. I am not going to waste my time and argue with you. Though perhaps arrogant on my part I understand where you are coming from. You have what to lose from this big shift that is going on. You are also in a declining minority. You happen with every shift of technology, with every advancement, you are those who lose their jobs to technolgoy, to automation. You will probably lose your current job but, hopefully, you will find another, better, cleaner, more sustainable one.

Wednesday, December 23, 2009

Second post...starting a trend here...

I am still struggling with getting my recording capabilities up and running. I started compiling a list of my first few interviewees and even spoke to some of them. I'm not giving up and neither should you.

So, what is cleantech? Wikipedia defines Cleantech as a term used to describe knowledge-based products or services that improve operation performance, productivity, or efficiency while reducing costs, inputs, energy consumption, waste or pollution.

Though the "knowledge-based" in the definition may be redundant, it could, i believe, be pinned on nearly any COO in any company (maybe excluding the "waste or pollution" part). What I mean is that improving operational performance, productivity and efficiency on the one hand while reducing costs, inputs and energy consumption is, as I learnt in business school, what improves profitability. So what's new here? Isn't this what capitalism is all about? If so then what's so special about it. If not, then what went wrong along the way?

Well, several things went wrong along the way. First, is that many industries, processes, and supply chains are wasteful. They never really took a close look at the resources being used and then thrown out in any given process. Or, they were just taken for granted in the process of developing new machines that produce new stuff, without taking input and output, on all levels, into consideration - particularly energy.

And ENERGY is the key to our discussion and to the discussions to come. First, because energy costs money and the price of energy is highly volatile because it is a finite resource; and second, because most of the energy used in the world is based on fossil fuels that release CO2 when burned.

These two facts about energy are the keys to understanding the birth of the cleantech industry and its continuing growth.

More too come...

Sunday, December 20, 2009

And we're off...

The world is warming, the climate is changing, 130 leaders meet, for the first time ever, in Copenhagen, to discuss a topic they have for years mostly considered esoteric. Pollution, environment, emissions, carbon, CO2 on the front pages of all the major newspapers around the world. Solar panels, photo voltaic, CPV, BIPV, wind turbines (large and small), wave energy, energy from waste, energy from the earth's core, combined heat and power, fuel from plants, from algae, from waste, energy storage, energy efficiency are all causing a buzz. Vestas, Pelamis, JA Solar, Ormat, Comverge, Enertech, Evergreen, Q-Cell, Carmanah, SunPower, First Solar, E.ON, GE, Echelon, Pinnacle, PE&G, Portland Energy, Vattenfall and many more companies whose stock is being traded on the NYSE, Nasdaq, Frankfurt, FTSE and other markets the world over.

Having been immersed in this field on the side of policy, investments and corporate since 2002. Having made more than I lost over the past 4 years with different stocks in different markets and having a passion for the field and a strong belief that only with a serious shift to renewable energy, sustainable thought and behavior and a general paradigm shift in how we live, do business, travel, eat, I have decided to start A green, clean space.

What I'm going to do here we are going to have to all wait and see but I hope it will be useful, interesting, entertaining at times and helpful in trying to make some order in this green, clean space.

Thanks for joining!

And finally, as my beloved brother says: "Giving up is not an option!"