The Future of Energy Transformation

This week, many conversations at CERAWeek in Houston— one of the world’s leading energy events— revolved around the massive transformation that is reshaping the global energy landscape. Topics ranged from energy and climate policy to innovation and investment in an energy market that is going through unprecedented change. The growing role of renewables and the impact of distributed energy technologies were two frequently discussed examples. 

At GE, we believe that the energy transformation is playing out as an evolution: from a centralized, one-directional grid, into a decentralized, decarbonized, digitized network that’s smarter and more productive.  

This evolution brings together seemingly competitive energy offerings—solar, coal, wind and gas—that combine traditional and emerging energy to deliver more efficient and effective results.

Read the story from LinkedIn by GE Chairman and CEO, John Flannery - “The Future of Energy Transformation.”

Australia criticised for lack of long-term climate policy

A global energy body has criticised Australia’s lack of a long-term climate policy and urged a swift embrace of electricity market reform.

The International Energy Agency’s four-yearly review of the country’s energy policies, released yesterday, focuses on the transition to a low-carbon economy and the role of gas — areas the Federal Government chose for special scrutiny.

Executive Director Fatih Birol. 

It says the resilience of Australia’s electricity system is being tested with the transition happening at a faster pace and scope than expected.

However, the IEA says despite pledging to cut emissions under the Paris climate agreement, the Federal Government ‘‘has not yet come forward with durable climate change policies after 2020’’ nor named a long-term goal.

It notes that while Australia has cut the emissions intensity of its electricity sector by 15 percent since 2005, it is still the highest of any IEA member country and double the average.

‘‘The country is not subject to any effective carbon constraint or rate under the Emissions Reduction Fund and its safeguard mechanism,’’ the report states.

‘‘Current energy efficiency measures and climate mitigation policies are not sufficient. To meet its 2030 target, domestic efforts need to increase.’’

While the agency sees the national electricity market, covering the east coast states, as a world-leader, the IEA warns greater collaboration on energy security is needed.

‘‘The energy policy governance in Australia is very complex and fragmented,’’ it states.

‘‘It suffers from frequent changes of policy direction and institutions at commonwealth level.’’

A stable and longer-term framework of climate and energy policies is critical for investors and consumers.

The Turnbull government has proposed a national energy guarantee to ensure a reliable and lower emissions electricity sector.

The IEA says this could be an effective market-based mechanism provided the government can ensure more competition, better connection between the states and stronger rules for the integration of renewables.

‘‘We don’t know the details (of the NEG) yet, but looking at the concept and the highlights, I would say that this is a golden opportunity for Australia to study and to bring the energy and climate targets together,’’ executive director Fatih Birol said.

However, the report warns the policy could not become a silver bullet solution.

Energy Minister Josh Frydenberg says the IEA’s 52 recommendations align with what the government is already doing.

‘‘In particular, the national energy guarantee goes towards the review’s overarching recommendation for a stable, enduring policy response so that Australia can manage the energy transition already taking place,’’ he said.

Dr Birol briefed a group of about 100 stakeholders including Liberal, Labor and Greens MPs on the IEA report yesterday morning.

Greens energy spokesman Adam Bandt said the IEA made it clear the overwhelming majority of pollution cuts for Australia would come from renewables and energy efficiency and that was where the government should be spending its money.

From today’s Shepparton News - “Climate policy void warning.”

World Must Reach Net Zero Emissions Sooner, Study Finds, to Reach Paris Climate Goal

Humanity's emissions of greenhouse gases must peak within the next decade for the world to meet the goals of the Paris climate agreement, according to a new study published Thursday. Hitting that mark would require strong growth in renewable energy and rapid deployment of emissions-capturing technologies, the authors said.

To keep the global temperature rise to relatively safe levels,
a new study says, fossil fuels ultimately will need to supply
less than a quarter of global energy by 2100. They
currently provide about 90 percent. 

Ultimately, fossil fuels will need to supply less than a quarter of global energy by 2100. They currently provide about 90 percent.

In a press release, the lead author called the goal ambitious but not impossible. But it added that continued reliance on fossil fuels and growth rates of only 2 to 3 percent in renewables would mean carbon emissions would peak toward the end of the century, with global temperatures rising about 3.5 degrees Celsius by then.

Read the Inside Climate News story - “World Must Reach Net Zero Emissions Sooner, Study Finds, to Reach Paris Climate Goal.”

Large oil companies factor in eventual global energy transition

Wood Mackenzie finds large oil companies
 factoring in rise of gas and renewables
 out to 2040.

A report into the transition of energy systems shows that natural gas and zero-carbon fuels will meet nearly 60 per cent of the rise of global energy demand to 2035.

Business consultants Wood Mackenzie released the report called 'Fossil Fuels to low-carbon:The Majors' energy transition' which looked at how the world's largest energy companies are preparing for the transition.

It outlines how coal and oil could peak before 2035, although in its most recent Annual Outlook, the World Energy Agency says the number of barrels of oil will increase to 103.5 million barrels a day by 2040.

According to the WEA the 92.5 mb/d were consumed in 2015.

The WEA outlook for growth in oil is in recognition of the lack of a technology breakthrough for roadfreight and aviation fuels and petrochemicals
 

Read the ABC Rural story - “Large oil companies factor in eventual global energy transition.”

Fossil fuel use grows, but it is the slowest since the late 90s

B

P recently released its Statistical Review of World Energy 2015 and found that consumption of fossil fuels in 2014 continued to increase despite primary energy consumption just 0.9 percent higher, which, absent the financial crisis, is the slowest growth of global energy demand since the late 1990s.

Global oil consumption grew 0.8 percent in 2014, while natural gas and coal consumption each increased by 0.4 percent. Despite these increases, the leaders of the G7 countries (United States, Germany, France, UK, Italy, Canada, and Japan) agreed to phase out the use of fossil fuels by the end of the century.

According to BP, the United States is now the world leader in both oil and natural gas production, regaining the title in oil, which it last held in 1975.

The United States produced 11.6 billion barrels of oil in 2014—an increase of 16 percent over 2013 levels–to overtake both Russia and Saudi Arabia—the latter producing 11.5 billion barrels.

U.S. oil production grew by 1.6 million barrels per day, making the United States the only country in the world ever to record three consecutive years of 1 million barrel-a-day or more growth.

U.S. oil production in 2014 exceeded the previous peak level of U.S. production set in 1970. The 11.6 billion barrels of U.S. oil production in 2014 is made up of oil, condensate, and natural gas plant liquids.

Read the Institute for Energy Research story - “Global Consumption of Fossil Fuels Continues to Increase”.