Clean Energy Chronicles

Chris Goodall, economist and author of the widely-acclaimed 'What we need to do now for a zero carbon future', provides his unique take on the latest developments in the clean energy industry.

1. The cost of getting to net zero. A research group led by Stanford’s Mark Z Jacobson wrote that the total cost of moving to an energy system based on 100 per cent renewables by 2050 would be USD61.5 trillion, equivalent to about USD2.2 trillion a year or about 2.5 per cent of world GDP, and little more than 10 per cent of the globe’s current capital investments per year. The group suggests a typical payback of under six years for the spending on decarbonisation. Jacobson is known for being controversially optimistic but the group’s very detailed analysis suggests that decarbonisation is highly affordable.

2. Removing CO2 from the air. The payments company Stripe leads a coalition of large businesses that offer funding for carbon removal. The consortium made six new investments in technologies ranging from the use of lime to the weathering of basalt dust and cheaper direct air capture. All the recipients are very early stage companies and the Stripe investments are small. Consequently, the costs per tonne of CO2 removed are very high, ranging from USD500 to USD1,800 per tonne. However Stripe says that the applications made for this round of funding were more diverse than ever. It commented favourably on the growing emphasis on using electricity for direct air capture, rather than heat, and using alkalinity to capture the acidic molecules of CO2. Another entity, Carbonfuture, also announced pre-funding of CO2 removal technologies, in one case overlapping with Stripe’s preferred choices.

3. The cost of switching to non-meat proteins. Consulting firm Boston Consulting Group (BCG) pointed out that about 15 per cent of global carbon emissions arise from the production of livestock. Consumers wanting to minimise their climate impact are increasingly investigating alternatives to meat. BCG said that 31 per cent of buyers think that one of the primary reasons to switch to non-meat proteins is having a positive impact on carbon emissions. But the consulting firm also said that ‘0 per cent’ of shoppers are prepared to pay a price premium. BCG points out that although scaling the alternative meat industry is expensive in terms of investment capital, it is likely to be the cheapest way of cutting greenhouse gases; a trillion dollars of investment in alternative proteins might cut emissions by 4.4 billion tonnes a year compared to 1.3 billion tonnes for the same investment in decarbonising steel. Surprisingly, the report doesn’t comment on even cheaper means of reducing emissions: replacing animal protein in our diets with natural vegetable proteins from foods such as beans.

4. Long distance electricity transmission. High voltage direct current (HVDC) power lines can now bring electricity from areas of excellent solar and wind availability to the main consuming regions. Two of the most important proposed projects plan to ship power from Morocco to the UK and from Australia to Singapore. Both require HVDC links of around 4,000 km, with most of the length underwater. The current longest underwater HVDC line is only 700 km in length. The cost of each of the two proposed lines and the associated solar and wind farms will be around USD20 billion, according to the proponents of the schemes. Both will also use large battery parks to help match demand to the available supply. The Morocco-UK link suggests it can provide 10 per cent of the total current power need of the recipient country while the smaller flow to Singapore promises at least 5 per cent of its requirements. Importantly, the Morocco-UK scheme promises a price of GBP48 (about USD58) per megawatt hour, comparable to recent prices agreed for solar power originating in the UK. The high transport costs and electricity losses en route are counterbalanced by the much higher solar productivity in Morocco.

5. Trade in hydrogen. The International Renewable Energy Agency (IRENA) published a report on the future international trade in hydrogen. IRENA predicts that about one quarter of total hydrogen production will be shipped across international borders in 2050. The trade would amount to about 150 million tonnes, of which 55 per cent would be transported by pipeline and the rest principally by sea in the form of ammonia (NH3), which is a hydrogen carrier easier to move over large distances than the liquid gas itself.

6. Green hydrogen in steel-making. Arcelor Mittal is one of the world’s largest steel-makers and has committed to end production using coal by 2050 at the latest. It says it will reduce emissions by more than 35 per cent in Europe by 2030. These objectives can probably only be achieved by switching to green hydrogen as a fuel and as a reducing agent for iron ore. It linked with German utility RWE to work on offshore wind development to provide the electricity for its extensive hydrogen plans. The two companies plan to build wind farms in German waters that will supply electrolysers close to the steel works. Arcelor Mittal targets a 70 megawatt unit near to its Bremen factory by 2026. Given the vast amount of hydrogen that steel decarbonisation will need, the company is attempting to secure a reliable source of supply.

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