Demand for clean energy is growing, so it better be there

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<header><h1>Demand for clean energy is growing, so it better be there</h1><a href="" rel="author"></a><span class="title"></span><time rel="pubdate" datetime="2021-11-17T00:00:00-05:00">Nov 17, 2021</time></header><p>Tadeu Carneiro, a 40-year veteran of the metals and mining industry, has bet his career on making steel from zero-emission electricity.</p><p>An engineer by trade, Carneiro and his team at startup Boston Metal are working to perfect the technology in a pilot plant in Massachusetts, but there’s an essential ingredient he needs that he has less control over: ample supplies of clean electricity.</p><p>“If you don&#8217;t believe that electricity will be abundant, reliable, cheap and green in the future, then forget it,” said Carneiro, CEO of the company. “But then forget about the electrification of everything…. We have to believe that we will have abundant, cheap, green and available and reliable electricity in the future.”</p><div class="callout"> Last week, <a href="https://ciphernews.com/articles/hurdles-abound-in-race-to-build-more-clean-energy/" target="_blank" rel="noopener">Cipher looked</a> at the growing local opposition to power lines and wind and solar projects. This week, we’re laying out why all that clean energy matters for our entire economy. </div><p>Indeed, it’s not just Carneiro and his green steel.</p><p>To clean up our economy, experts agree we need to electrify as many parts of it as possible. In turn, that electricity needs to be powered by clean resources, like wind, solar and nuclear power, as fast as possible to make the biggest dent in heat-trapping emissions.</p><p>If all goes as most countries are planning, that clean energy will light and warm our homes, power our cars and even fuel manufacturing like steelmaking, which currently accounts for 9% of the world’s carbon emissions.</p><p>To do all this, the world’s electricity capacity needs to increase anywhere between four and nearly eight times its current size, much of that wind and solar, <a href="https://about.bnef.com/new-energy-outlook/?utm_source=hs_email&amp;utm_medium=email&amp;_hsenc=p2ANqtz-_HA-wzRoK60KyIiV0m2DVXRe-h7I94P-31IHsqricJj1v8wQcmLyAtqkH0mxwqVSZJJJhZ" target="_blank" rel="noopener" data-ac-default-color="1" data-hs-link-id="0">according to BloombergNEF</a>.</p><p>That’s a lot to ask of our aging electricity system, which in the United States is <a href="https://www.eia.gov/energyexplained/electricity/electricity-in-the-us-generation-capacity-and-sales.php?utm_source=hs_email&amp;utm_medium=email&amp;_hsenc=p2ANqtz-_HA-wzRoK60KyIiV0m2DVXRe-h7I94P-31IHsqricJj1v8wQcmLyAtqkH0mxwqVSZJJJhZ" target="_blank" rel="noopener" data-ac-default-color="1" data-hs-link-id="0">still nearly</a> 60% coal and natural gas. What’s more, many states are shutting down zero-emitting nuclear power plants.</p><p>A <a href="https://netzeroamerica.princeton.edu/the-report?utm_source=hs_email&amp;utm_medium=email&amp;_hsenc=p2ANqtz-_HA-wzRoK60KyIiV0m2DVXRe-h7I94P-31IHsqricJj1v8wQcmLyAtqkH0mxwqVSZJJJhZ" target="_blank" rel="noopener" data-ac-default-color="1" data-hs-link-id="0">recent study</a> by Princeton University posited different pathways to a net-zero emission U.S. economy by 2050. Researchers found that the electricity sources for heating and manufacturing changed a lot depending on the different mixes of zero-carbon energy sources.</p><p>In a scenario with large amounts of wind and solar electricity, two notable things happened: 1) Hybrid boilers for heating proliferated. Such equipment can switch back and forth as needed from renewable electricity to natural gas. 2) “Green” hydrogen made from electrolysis using wind and solar power also proliferated.</p><p>Hydrogen can be used in several different kinds of energy applications, including storage, manufacturing facilities and long-haul transportation.</p><p>“Both of those are large flexible demand sinks and they can suck up whatever extra wind and solar there is and allows you to use a lot more renewable electricity to displace industrial fuels than you would otherwise,” said Jesse Jenkins, Princeton University professor and co-author of the study.</p><p>In a scenario with constrained wind and solar resources, electric boilers and green hydrogen give way to much more “blue” hydrogen made from natural gas with carbon-capture technology. Nuclear and gas-fired plants with carbon capture also play a much larger role in decarbonizing electricity.</p><p>“Those technologies are critical hedges against potential constraints on renewables expansion, which could be driven by limitations on transmission or opposition to wind or land impacts of solar,” Jenkins said.</p><p>Green hydrogen has a particularly—some say disturbingly so—big appetite for clean electricity. <a href="https://about.bnef.com/new-energy-outlook/?utm_source=hs_email&amp;utm_medium=email&amp;_hsenc=p2ANqtz-_HA-wzRoK60KyIiV0m2DVXRe-h7I94P-31IHsqricJj1v8wQcmLyAtqkH0mxwqVSZJJJhZ" target="_blank" rel="noopener" data-ac-default-color="1" data-hs-link-id="1">BloombergNEF found</a> that in its scenario depending heavily on wind and solar, more than 50% of global renewable electricity capacity would go to hydrogen production, which ultimately would feed 22% of the world’s final energy consumption.</p><p>“In terms of energy throughput, that’s not great,” said Seb Henbest, BloombergNEF’s chief economist.</p><p>Raffi Garabedian, CEO of startup Electric Hydrogen Co., is working on technology producing hydrogen from wind and solar. He says the proliferation of green hydrogen could actually help integrate more wind and solar into the energy mix and make use of such resources in areas not close to population centers.</p><p>He <a href="https://www.reuters.com/business/sustainable-business/momentum-grows-green-hydrogen-projects-tasmania-2021-11-12/?utm_source=hs_email&amp;utm_medium=email&amp;_hsenc=p2ANqtz-_HA-wzRoK60KyIiV0m2DVXRe-h7I94P-31IHsqricJj1v8wQcmLyAtqkH0mxwqVSZJJJhZ" target="_blank" rel="noopener" data-ac-default-color="1" data-hs-link-id="0">cited plans</a> in Western Australia as an example of building wind and solar for the express purpose of green hydrogen, which would then be used to make zero-carbon ammonia. Ammonia can be used for electricity storage or as transport fuel.</p><p>He likened the dynamic between renewable electricity and hydrogen to a chicken-and-egg dilemma. He says the cheap prices for wind and solar today could help secure contracts with consumers of green hydrogen.</p><p>“With that contract in hand, we have the resources to build incremental solar or wind generation and hydrogen electrolysis,” Garabedian said. “So, in effect, the availability of very productive, low-cost [hydrogen] technology will also pave the way to greater adoption of wind and solar.”</p><p><em>Note: Boston Metal and Electric Hydrogen are part of the </em><a href="https://www.breakthroughenergy.org/investing-in-innovation/bev-portfolio?utm_source=hs_email&amp;utm_medium=email&amp;_hsenc=p2ANqtz-_HA-wzRoK60KyIiV0m2DVXRe-h7I94P-31IHsqricJj1v8wQcmLyAtqkH0mxwqVSZJJJhZ" target="_blank" rel="noopener" data-ac-default-color="1" data-hs-link-id="0"><em>investment portfolio</em></a><em> of Breakthrough Energy Ventures.</em></p>
Demand for clean energy is growing, so it better be there

by -
November 17, 2021
Tadeu Carneiro, a 40-year veteran of the metals and mining industry, has bet his career on making steel from zero-emission electricity. An engineer by trade, Carneiro and his team at startup Boston Metal are working to perfect the technology in a pilot plant in Massachusetts, but there’s an essential ingredient he needs that he has less control over: ample supplies of clean electricity. “If you don’t believe that electricity will be abundant, reliable, cheap and green in the future, then forget it,” said Carneiro, CEO of the company. “But then forget about the electrification of everything…. We have to believe that we will have abundant, cheap, green and available and reliable electricity in the future.” Last week, Cipher looked at the growing local opposition to power lines and wind and solar projects. This week, we’re laying out why all that clean energy matters for our entire economy. Indeed, it’s not just Carneiro and his green steel. To clean up our economy, experts agree we need to electrify as many parts of it as possible. In turn, that electricity needs to be powered by clean resources, like wind, solar and nuclear power, as fast as possible to make the biggest dent in heat-trapping emissions. If all goes as most countries are planning, that clean energy will light and warm our homes, power our cars and even fuel manufacturing like steelmaking, which currently accounts for 9% of the world’s carbon emissions. To do all this, the world’s electricity capacity needs to increase anywhere between four and nearly eight times its current size, much of that wind and solar, according to BloombergNEF. That’s a lot to ask of our aging electricity system, which in the United States is still nearly 60% coal and natural gas. What’s more, many states are shutting down zero-emitting nuclear power plants. A recent study by Princeton University posited different pathways to a net-zero emission U.S. economy by 2050. Researchers found that the electricity sources for heating and manufacturing changed a lot depending on the different mixes of zero-carbon energy sources. In a scenario with large amounts of wind and solar electricity, two notable things happened: 1) Hybrid boilers for heating proliferated. Such equipment can switch back and forth as needed from renewable electricity to natural gas. 2) “Green” hydrogen made from electrolysis using wind and solar power also proliferated. Hydrogen can be used in several different kinds of energy applications, including storage, manufacturing facilities and long-haul transportation. “Both of those are large flexible demand sinks and they can suck up whatever extra wind and solar there is and allows you to use a lot more renewable electricity to displace industrial fuels than you would otherwise,” said Jesse Jenkins, Princeton University professor and co-author of the study. In a scenario with constrained wind and solar resources, electric boilers and green hydrogen give way to much more “blue” hydrogen made from natural gas with carbon-capture technology. Nuclear and gas-fired plants with carbon capture also play a much larger role in decarbonizing electricity. “Those technologies are critical hedges against potential constraints on renewables expansion, which could be driven by limitations on transmission or opposition to wind or land impacts of solar,” Jenkins said. Green hydrogen has a particularly—some say disturbingly so—big appetite for clean electricity. BloombergNEF found that in its scenario depending heavily on wind and solar, more than 50% of global renewable electricity capacity would go to hydrogen production, which ultimately would feed 22% of the world’s final energy consumption. “In terms of energy throughput, that’s not great,” said Seb Henbest, BloombergNEF’s chief economist. Raffi Garabedian, CEO of startup Electric Hydrogen Co., is working on technology producing hydrogen from wind and solar. He says the proliferation of green hydrogen could actually help integrate more wind and solar into the energy mix and make use of such resources in areas not close to population centers. He cited plans in Western Australia as an example of building wind and solar for the express purpose of green hydrogen, which would then be used to make zero-carbon ammonia. Ammonia can be used for electricity storage or as transport fuel. He likened the dynamic between renewable electricity and hydrogen to a chicken-and-egg dilemma. He says the cheap prices for wind and solar today could help secure contracts with consumers of green hydrogen. “With that contract in hand, we have the resources to build incremental solar or wind generation and hydrogen electrolysis,” Garabedian said. “So, in effect, the availability of very productive, low-cost [hydrogen] technology will also pave the way to greater adoption of wind and solar.” Note: Boston Metal and Electric Hydrogen are part of the investment portfolio of Breakthrough Energy Ventures.