Despite aggressive adoption of renewable energy by a number of industrialized countries, roughly 80% of the world’s energy for heating, power and transportation still comes from fossil fuels: oil, natural gas and coal.
Asked at a Globe 2018 forum on energy transition last week what the world’s energy mix will look like in 2100, even Andy Calitz, CEO of the Royal Dutch Shell-led consortium LNG Canada, said he thinks it will be an electrified world, with solar power being the most dominant source of electricity.
But to put the challenge of getting there in context, he said Shell is arguably the world’s largest or second-largest oil and gas company but supplies just 1% of the world’s oil and gas.
So, getting to a 100% emissions-free energy mix would mean replacing the energy produced by 100 Shells.
“That’s the size of the challenge,” Calitz said. “When people speak about the post-carbon economy in four years, they have no idea what they’re talking about. This will take decades, and I hope that the decades go as fast as possible.”
Getting to a fossil-fuel-free world will require a range of low- or zero-emission energy technologies, including biofuels, hydrogen fuel cells and nuclear power, forum speakers said.
While nuclear power has fallen out of favour in recent years, thanks to the Fukushima disaster in Japan, Kathryn McCarthy, vice-president of research and development at Canadian Nuclear Laboratories, suggested nuclear power can and should play an important role in energy transition, because it provides firm, emissions-free baseload power.
And yet when Saskatchewan, which has an abundance of uranium, was looking to increase its power production a couple of years ago, it invested close to $1 billion to upgrade a coal-fired power plant.
A large part of that investment was for new carbon capture technology. But the carbon that is captured from the plant is used in enhanced oil recovery, which doesn’t address the challenge of reducing carbon dioxide emissions.
McCarthy said Saskatchewan, through SaskPower, is now looking at nuclear power. A company called Terrestrial Energy wants to build a small modular reactor in Saskatchewan.
“SaskPower is – in a lot of discussions with us – they’re considering, when they’re adding electricity to the grid, they’re looking potentially at nuclear,” McCarthy said. “Saskatchewan is saying, ‘Hey we want to be more than just the uranium provider. We think there’s more in it for us.’”
McCarthy said 11% of the world’s power currently comes from non-emitting nuclear power. In Canada, it’s 16%.
“When you look worldwide, while it’s 11% of electricity, it’s actually more than 30% of non-emitting electricity, so it’s an important part of the clean-energy portfolio.”
The problem for nuclear power is cost. In the U.S., it can’t compete with cheap natural gas.
McCarthy conceded nuclear power has high upfront capital costs, but once a nuclear plant is built, uranium prices remain relatively stable.
While nuclear, wind and solar power might be able to replace significant amounts of fossil-fuel-generated power and while electric vehicles are becoming popular for consumers, there are some transportation sectors that might never be able to run on electricity.
Airplanes, for example, are never likely to be powered by electricity. For that sector, as well as long-haul trucking, shipping and rail, biofuels derived from things like wood waste are the best solution, said Jack Saddler, professor emeritus at the University of British Columbia.
“The aviation sector realizes there’s not really any other option than a drop-in,” Saddler said. (A drop-in is a fuel that can be substituted without engine modifications.)
“It’s going to be a while, despite what Elon Musk thinks, before we are electrifying trucks.”
While biofuels can be made from a range of organic materials, including canola oil, in Canada the best source is wood waste. Saddler said he thinks B.C. is well positioned to aggressively pursue a transition to biofuels, thanks to its abundance of wood waste and its biggest port.
“British Columbia and Vancouver is a pretty good place to try and do this,” Saddler said, “because we have the Port of Vancouver. So we have a convergence of aviation, rail, marine, trucking.”
The challenge for biofuel is that diesel and jet fuel are still relatively cheap.
“I think in our society the best policy we have to stop doing things is make it expensive,” Saddler said.
Rob Campbell, chief commercial officer for Ballard Power Systems (TSX:BLDP), echoed Saddler’s assertion that fossil fuels need to be priced out of favour.
He said hydrogen could be an important link in solving the problem with renewable energy storage.
Currently, the biggest demand for Ballard’s hydrogen fuel cell technology is from China, which is motivated more by air pollution than by climate change concerns. But he thinks hydrogen can play a role in solving the storage problem that intermittent power poses.
While renewables like wind and solar can augment a grid’s supply of power, they currently cannot provide a lot of dispatchable power. Because they are intermittent, they are unreliable.
Renewable-energy proponents say the problem can be easily solved with large-scale battery storage, and the price of large-scale lithium-ion batteries has been coming down quickly.
But that is still not a solution for meeting peak power demand. Power stored in batteries from wind and solar can be used for balancing power, but it is not yet able to meet peak power demands.
“The big challenge is grid stability,” Campbell said.
Intermittent energy is often produced when it’s not needed. At those times, wind and solar energy could be used to produce hydrogen from water through electrolysis. The hydrogen could then be used to generate power through fuel cells.
“The hydrogen ecosystem will allow coupling with renewables so that we can go to 100-plus renewable energy,” Campbell said.
The problem now is that electrolysis takes a lot of energy, so it is expensive to make hydrogen that way. But as Campbell pointed out, since 2000, there has been a 100-fold growth of renewable energy, and costs have dropped 90%. At some point, he believes hydrogen will become an affordable means of energy storage.
“The costs will fall in a similar fashion,” he said. “I don’t see it as a barrier.”
As for liquefied natural gas (LNG), while it isn’t emissions-free, it produces half as many greenhouse gas emissions as coal does, which is why it is considered by many to be an important bridge fuel as the world eventually transitions to 100% emissions-free energy.
Calitz said that the LNG Canada project in particular has been designed for its Kitimat plant to have low emissions.
“LNG Canada has designed an LNG plant which is more efficient in terms of producing LNG, by a factor of 50%, than any other plant in the world,” Calitz said.
That is being accomplished, in part, by relying on clean hydro power for the ancillary power needs of the plant.