Frac­tal Fu­ture

As global en­ergy sup­ply is be­com­ing more di­verse, en­tirely new mod­els of power gen­er­a­tion are emerg­ing.

Norway-Asia Business Review - - S NAPSHOTS - HENRI VIIRALT

De­vel­op­ing re­new­able en­ergy has be­come in­creas­ingly cheaper and more vi­able than ever be­fore, which in turn has trig­gered an on­go­ing par­a­digm shift, forc­ing many stake­hold­ers to re-ex­am­ine how to ap­proach this new era in global en­ergy gen­er­a­tion.

In­ter­na­tional Re­new­able En­ergy Agency’s (IRENA) an­nual re­new­ables re­port, re­veals that re­new­able en­ergy now ac­counts for a third of global power ca­pac­ity with growth in all re­gions of the world, al­beit at vary­ing speeds.

Ac­cord­ing to the re­port, Asia ac­counted for 61% of new re­new­able en­ergy in­stal­la­tions and grew in­stalled re­new­ables ca­pac­ity by 11.4%, with growth be­ing fastest in Ocea­nia, which wit­nessed a 17.7% in­crease in 2018. Africa’s 8.4% growth put it in third place just be­hind Asia. In to­tal, nearly two-thirds of all new power gen­er­a­tion ca­pac­ity added in 2018 was from re­new­ables, led by emerg­ing and de­vel­op­ing economies.

IRENA’s analysis also con­trasted re­new­ables to non-re­new­able en­ergy,

fo­cus­ing pre­dom­i­nantly on nu­clear and fos­sil fu­els. It found that while non­re­new­able gen­er­a­tion ca­pac­ity has steadily de­creased in Europe, North Amer­ica and Ocea­nia since 2010, it has in­creased in Asia and the Mid­dle East over the same pe­riod.

“Through its com­pelling busi­ness case, re­new­able en­ergy has es­tab­lished it­self as the tech­nol­ogy of choice for new power gen­er­a­tion ca­pac­ity,” said IRENA Di­rec­tor-Gen­eral Ad­nan Z. Amin in a press re­lease. “The strong growth in 2018 con­tin­ues the re­mark­able trend of the last five years, which re­flects an on­go­ing shift to­wards re­new­able power as the driver of global en­ergy trans­for­ma­tion. Re­new­able en­ergy de­ploy­ment needs to grow even faster, how­ever, to en­sure that we can achieve the global cli­mate ob­jec­tives and Sus­tain­able De­vel­op­ment Goals.”

Aside from Ice­land, which gen­er­ates the most clean elec­tric­ity per capita on earth, with nearly 100% of its en­ergy com­ing from re­new­able sources, several other coun­tries have re­cently joined Ice­land in lead­ing the charge to­wards a cleaner fu­ture.

For several years, Costa Rica has been able to run on around 95% re­new­ables for an av­er­age of 300 days per year. While there are several fac­tors be­hind this, such as an abun­dance of geo­ther­mal re­new­able sources, a small pop­u­la­tion and a lack of heavy in­dus­try, an­other key rea­son is that for the first time in his­tory, new re­new­ables projects can be de­ployed with­out gov­ern­men­tal sup­port.

One of the big­gest in­dus­try news sto­ries last year cov­ered Hol­landse Kust Zuild, an offshore wind farms project, which will be sit­u­ated 20 km off the coast of The Hague. Hol­landse Kust Zuid phases I and II are ex­pected to gen­er­ate 750MW - enough to sup­ply around 1mil­lion house­holds with green en­ergy. It will be the world’s first offshore wind farm to be built en­tirely with­out pub­lic sub­sidy.

Many

Euro­pean coun­tries

are now look­ing to get rid of sub­si­dies for re­new­able en­ergy projects. Bei­jing, too, has re­cently an­nounced that China will give pri­or­ity to the con­struc­tion of sub­sidy-free re­new­ables projects. This comes on the back of the cen­tral govern­ment’s pledge last year in en­sur­ing that re­new­ables will be­come grid com­pet­i­tive with tra­di­tional en­ergy sources, af­ter a surge in ca­pac­ity left the fi­nance min­istry with a sub­sidy pay­ment back­log of around USD 17.9bn.

“The cost re­duc­tions in re­new­ables have ac­tu­ally been hap­pen­ing since the 1970s, but prices were kept high be­cause of the de­mand through sub­si­dies, which over­whelmed the sup­ply chain. At the same time in­vest­ments kept pour­ing in, and once there was enough of in­vest­ment, it started to push the prices down very quickly. The cost curve was re­ally quite con­sis­tent,” says Mr Michael Liebre­ich, CEO of Liebre­ich As­so­ciates, through which he pro­vides ad­vi­sory ser­vices and speaks on clean en­ergy and trans­porta­tion, smart in­fra­struc­ture, as well as cli­mate fi­nance, tech­nol­ogy and sus­tain­able de­vel­op­ment.

“We’re now liv­ing in a world where wind and so­lar have not only be­come grid-com­pet­i­tive, but they’ve blasted right through it. Nev­er­the­less, it is im­per­a­tive to keep in mind that these are vari­able re­sources and we need to come up with a com­pletely dif­fer­ent way of think­ing about how to de­liver elec­tric­ity mov­ing for­ward,” Mr Liebre­ich adds.

Prior to re­new­ables, he says, the only con­sid­er­a­tion for de­liv­er­ing en­ergy was baseload power, which was cheap, and peak­ing re­sources such as gas, gaso­line and diesel that were con­sid­er­ably more ex­pen­sive and were re­served for times when the grid was un­able to cope with de­mand. The dif­fer­ence to­day, is that due to the vari­able na­ture of re­new­ables, ev­ery­one is try­ing to get their hands on as much re­new­able en­ergy as they pos­si­bly can, which es­sen­tially cre­ates a “sur­plus budget” to offset peak­ing re­sources.

“A lot of com­men­ta­tors seem to find it very dif­fi­cult to un­der­stand that this can be just as re­silient, just as cheap, but much cleaner than the al­ter­na­tives.”

Look­ing at South­east Asia, Mr Liebre­ich sees am­ple op­por­tu­nity for growth, but con­sid­ers the re­gion’s rich re­new­able en­ergy po­ten­tial largely un­tapped. He also en­vi­sions a fu­ture where en­ergy de­liv­ery sys­tems around Mekong and else­where will be far more frag­mented and in­tri­cate than they cur­rently are.

“Peo­ple who think we’ll just slap a few so­lar pan­els on the roofs and call it a day, that’s not how this will work be­cause it would only cover a part of a sin­gle house­hold’s en­ergy needs. Instead, we’ll have a frac­tal de­sign where we’ll take the so­lar from your roof, but also the wind from the coast nearby and per­haps more so­lar from a neigh­bor­ing coun­try.

Sea­son­al­ity also plays a big role in power gen­er­a­tion ca­pac­ity in both wind and so­lar, so an ad­di­tional em­pha­sis needs to be placed on data and map­ping of re­sources.”

There are a fair share of op­posers to the de­vel­op­ment of re­new­ables, with the main crit­i­cisms cen­ter­ing mainly around the en­vi­ron­men­tal im­pact on wildlife due to the large land­mass re­quired for the projects, and even the aes­thetic im­pact on the land­scape in the case of wind en­ergy and its enor­mous tur­bines.

“It’s true that one of the down­sides of re­new­ables is that they re­quire a large amount of space to de­velop. They are not go­ing be as dense as gas, coal or nu­clear-fu­eled power sta­tions, but that’s why float­ing so­lar pan­els in reser­voirs and offshore wind are such in­ter­est­ing prospects, espe­cially for many land starved coun­tries like Ja­pan, UK, Sin­ga­pore or Hong Kong.”

Mr Liebre­ich also points out that an emerg­ing trend in so­lar is mount­ing higher up, which means that the ground be­neath it could be used for agri­cul­ture, giv­ing it a dual pur­pose.

“The truth is that de­vel­op­ing any type of en­ergy will have an im­pact, but these are not un­sur­mount­able chal­lenges.

Once you have lo­cal con­sent and buy-in, the good thing about re­new­ables in that they will be con­sumed lo­cally. It’s not as if there will be a mas­sive wind farm in Thai­land and all that power would be shipped to Saudi Ara­bia.”

He points out that two hun­dred years ago, we had a very dif­fer­ent re­la­tion­ship with en­ergy – ev­ery­one knew that you don’t heat the house when it’s not in use, and par­tial heat­ing for most used rooms was how peo­ple sur­vived win­ters.

“While I’m not ad­vo­cat­ing go­ing back to that type of sto­icism, it’s clear that every­body had a re­la­tion­ship with en­ergy that was very dif­fer­ent. We’re now wit­ness­ing a very odd pe­riod of human his­tory where you flip a switch and you don’t even know where the power sta­tion is that is pow­er­ing the lights. At the same time, re­new­ables with lo­cal com­mu­nity own­er­ship mod­els or even switch­ing to LED light bulbs for en­ergy ef­fi­ciency are forc­ing peo­ple to have a more di­rect re­la­tion­ship to the homes and take back own­er­ship.”

The Three-Third World, a term pre­sented by Mr Liebre­ich at an EMEA sum­mit in 2017, that rep­re­sents an out­look of a world a world where 1/3 of elec­tric­ity would come from wind and so­lar, 1/3 of ve­hi­cles be elec­tric and the econ­omy would be 1/3 more en­ergy pro­duc­tive by 2040.

“If we man­age to achieve that by 2040, I will be happy not happy. I’ll be happy be­cause it cer­tainly out­strips my ex­pec­ta­tions when I founded New En­ergy Fi­nance in 2004. The rea­son I would be not happy is be­cause we have a real cli­mate prob­lem and although a Three-Third World would cap emis­sions from grow­ing, it’s nowhere enough. We need to go far beyond that, which means we need to do more wind and so­lar along­side other re­new­ables, nu­clear if we can, more elec­tric ve­hi­cles and fig­ure out how to de­car­bonise the rest of the econ­omy – in­dus­try, chem­i­cals, avi­a­tion, shipping, and heat.

The en­ergy de­liv­ery in­fra­struc­ture needs to be frac­tal and while grids aren’t go­ing any­where, we need to man­age power con­sump­tion on a mi­cro­grid level be­cause that will force us grab the clean re­sources and in­te­grate them, which is good for re­duc­ing over­all emis­sions but it’s also very good for re­silience, which is some­thing I’m very con­cerned about be­cause we’re rush­ing to­wards in­te­gra­tion on trans­porta­tion, en­ergy, and telecommun­ications and you can see how a fail­ure in one part of that net­work might cas­cade and bring the whole thing down.

I’m re­ally mi­cro­grids.” quite bullish on

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