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UQEI Energy Express #1
The modern world energy landscape and scenarios, trends, frameworks and choices driving
our energy future – a discussion primer
Professor Andrew Garnett
Director, Centre for Coal Seam Gas and CCS Program
The University of Queensland UQEI Energy Express #1
Slide 2
To set up and start a conversation
To frame and ground discussions about the future
UQEI Energy Express #1
A Primer:
Acknowledgement:
Many thanks to Caroline Stott of UQ Energy Initiative for
considerable assistance pulling together this presentation.
Slide 3
No facts are “inescapable” to the
delusional, the naïve, or those in
And some facts aren‟t facts
And, it turns out in the “energy” conversation
everyone is entitled both to their own opinion and
their own facts (… brilliant).
UQEI Energy Express #1
Inescapable Facts ! (or not ?)
Starters …
• The population is growing
• Standards of living / quality of
life do vary and very widely.
• There are very many poor – without access to modern forms
of energy
• Without economic growth more
people will suffer more than they
otherwise would. – World GDP is growing
• Economic growth is a
thermodynamic process
• More energy is being made
available – to increasing numbers
• Provision of energy has
increased living standards
• There are competing food-
energy and water-energy
demands
• Conc‟ns of atmospheric CO2 are
growing
• It is getting warmer and
extremes of weather will likely
be more frequent and less
predictable.
UQEI Energy Express #1
But first: Proof that the World is Mad
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Entropy Machines Oft seen around UQ !
Slide 6
And Perspectives Vary (flying?)
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Approximately 180 people attended the seminar, when asked only ONE had
NOT been on an international flight in the last year !!
Big Numbers Dominate …
7,252,729,625
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(sources: www.worldometers.info and www.reneweconomy.com.au)
Again …
81,876,921
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• Annual net population growth
– 224,320 people per day
– 9,347 people per hour
• Australia - 23,559,792 (3.5 mo.)
• Hobart – 216,959 (23 hrs)
• UQ students – 45,000 (4.8 hrs)
(source: www.worldometers.info)
Slide 9
Population 2 billion 4 billion 1 billion 1 billion
Income < $995 $996 - $3945 $3946 - $12195 > $ 12,196
Deaths under 5
(/1000 births) 120 60 24 7
Rate of Natural
Pop’n increase 2.27% 1.27% 0.96% 0.39%
Access to
sanitation 35% 50% 84% 99%
Education (yrs) 7.5 10.3 13.8 14.5
Urbanisation 27% 40% 74% 78%
Cars (per 1000) 5.8 20.3 125.2 435.1
CO2 emissions (t
per capita) 1 3 5 13
UQEI Energy Express #1
~$30,000 Australian min.
wage equiv
Source: National Geographic, 2011
The Spread …
Growth 81.9 million per year
Slide 10
< $995 p.a. for 2 billion
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Source: www.thinkm-pesa.com
Slide 11
More numbers …
One in Eight
40%
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… people in the world, were estimated to be suffering
from chronic hunger, regularly not getting enough food to
conduct an active life
… of all fruits and vegetables get wasted in India when
they move from grower to consumer. This is mainly due
to lack of refrigerated storage, transport, poor roads …
Slide 12
Crises & Dilemmas
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The crises create a real response dilemma of priority & timing:
Source: modified from www.coolrisk.com
Slide 13
Population Growth Abating
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Rapid growth in world population is
expected to subside in the next 40
years (red line).
3,263,738,832 (1964)
Slide 14 UQEI Energy Express #1
Source: Shell Scenarios; New Lenses on Future Cities
Urbanisation is key (+2.7 bln by 2050)
Slide 15
Humans Pursuing Benefits
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Source: Steffen et al. (2011)
“Reasons to be cheerful, Part 3” –
Ian Dury and the Blockheads, 1979
• Bolshoi Ballet
• Porridge oats
• Carrot juice
• Cheddar cheese and pickle
• Equal voting rights
• Going to the toilet
• Yellow socks
• Cure for smallpox
• Piccadilly circus
• Vincent motorcycles
• ….
Slide 16
Inherent Trade-offs
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Source: Steffen et al. (2011)
Trade offs – reasons to be somewhat
less cheerful
• Pollution
• Climate change
• Ecosystem loss
• Income inequality …
Slide 17
Development and Energy
UQEI Energy Express #1 Source: UN Human Development Index (2013 data); World Bank Annual Per Capita
Electricity Consumption (2011 data); World Bank Population (2013 data)
India
Nepal
Zimbabwe
DR Congo
China
Indonesia
South Africa
Mexico
Iran
UAE
Brazil
Russia
Norway Australia
US Canada UK
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
-2500 0 2500 5000 7500 10000 12500 15000 17500 20000 22500 25000
Hu
man
Develo
pm
en
t In
dex
Annual Per Capita Electricity Consumption (kWh)
Correlation Between Human Development and Per Capita Electricity Consumption
Low human development
Medium human development
High human development
Very high human development
It looks like one element of the challenge is to
enable people to come up towards ~5000 kWh pp pa
Slide 18
Development and Energy and Numbers
UQEI Energy Express #1 Source: UN Human Development Index (2013 data); World Bank Annual Per Capita
Electricity Consumption (2011 data); World Bank Population (2013 data)
India
Nepal
Zimbabwe
DR Congo
China
Indonesia
South Africa
UAE
Russia
Mexico Iran
Brazil
Norway Australia
US
Canada
UK
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
-2500 0 2500 5000 7500 10000 12500 15000 17500 20000 22500 25000
Hu
man
Develo
pm
en
t In
dex
Annual Per Capita Electricity Consumption (kWh)
Correlation Between Human Development and Per Capita Electricity Consumption - Population Overlay
Low human development
Medium human development
High human development
Very high human development 80% 20%
population population
But that‟s a lot of people
and so a lot of power
and so a lot of trade-offs
Slide 19
The Energy Choices Now Being Made
• Globally we currently consume about 12.7 billion tonnes of oil equivalent
• Fossil fuels are used for power generation, transportation and industrial
applications (cement, steel, fertilisers, plastics etc.)
UQEI Energy Express #1
Hydro 6.72% Renewables 2.19%
Nuclear 4.42%
Oil 32.87%
Gas 23.73%
Coal 30.06%
Hydro 6.44% Renewables 0.41%
Nuclear 5.99%
Oil 38.59% Gas
22.35%
Coal 26.22%
1993 (8.3 Btoe) vs 2013 (12.7 Btoe)
• Our energy sources have hardly changed over the last 20 years - the
vast majority of energy consumed is still supplied by oil, coal and gas...
Source: BP Statistical Review of World Energy 2014
Slide 20
Energy “Preferences” (?)
• Evidenced by Usage
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SOURCE 2003
Mtoe
2013
Mtoe
(‘03 – ’13)
D Mtoe
Preference in
action
(‘03 – ’13)
%
Oil 3725 4185 460 3rd 12%
Coal 2612 3827 1215 1st 47%
Gas 2345 3020 675 2nd 29%
Hydro 597 856 259 4th 43%
Nuclear 598 563 -35 6th -6%
Renewables 67 279 212 5th 317%
Total World 9944 12730 2786 28%
Fossil fuels (87% in 2013) 8682 11032 2350 21%
Source: BP Statistical Review of World Energy 2014
Slide 21
Striking a Balance or a Critical Chain ?
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Energy Security
Environment Economics
1. Secure it
•Secure the supply
• If not, diversify supplies & technologies
•Once OK …
2. Reduce the
costs
•Make it affordable
• If not seek competition in sources and suppliers &/or regulate prices
•Once OK …
3. Protect the
environment
• Improve local environmental performance
•(so long as this does not jeopardise 1 & 2 above)
• Improve global (GHG) performance if you can afford it
•(or at least position for future different mix)
HoE
Slide 22
Supply Interruption gets politically sensitive
- QUICKLY
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Nobody likes it but it’s just plain
unacceptable when it’s not there – it
hits the fan very quickly !
Slide 23
Energy Use – Tomorrow ?
UQEI Energy Express #1
• WEO scenarios for global primary energy demand and related CO2 emissions:
• Note WEO scenarios represent what is happening, what should happen and
what we would like to happen in order to mitigate climate change i.e. • Current Policies Scenario: Assumes no material changes to current policies.
• New Policies Scenario: Takes account of broad policy commitments and plans.
• 450 Scenario: Sets out an energy pathway consistent with the goal of limiting the
global increase in temperature to 2°C / 450 ppm CO2. Source: IEA World Energy Outlook 2013
Slide 24
Energy Use Under “New Policies”
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Installed capacity
by source Electricity
generation by
source
Slide 25
Risk Management Our Approaches ?
UQEI Energy Express #1
April 2nd, 1801. When ordered to
disengage: Horatio Nelson raises the
telescope to his blind eye at the Battle
of Copenhagen - ‘I see no ships’:
Slide 26
Communicating the Risks is Hard
UQEI Energy Express #1
• Some risks are important and urgent, other important and becoming urgent.
• Some consequences are already here, others are coming
• In the long run we‟re all … and so on
Source: www.coolrisk.com
Slide 27
Why Risk Management
UQEI Energy Express #1
• Why we are (or should be)
reconsidering our choices…
Source: IPCC, 2013: Summary for Policymakers
RCP Representative Concentration Pathways
GHG emissions
RCP2.6 – peak 2010-2020
RCP4.5 – peak 2040
RCP6.0 – peak 2080
RCP8.5 – cont. rise
Slide 28
Addressing the (GHG) Risk
UQEI Energy Express #1
• World energy-related CO2 emissions abatement in the New Policies Scenario
relative to the Current Policies Scenario - those bloody wedges
Source: IEA World Energy Outlook 2013
• Theoretical options for reducing emissions…
Example: Carbon Capture & Storage
• The CCS wedge – 450 ppm
scenario – NP ~ 1/3 challenge of the initial 450
scenarios
– By 2035, 22% of 14.8 Gt CO2 by CCS
– SO use CCS to abate 3.3 Gt in ~21 years
– Density (supercrit.) ~500kg/m3 m
– Volume = 6,600 million m3
– Volume = 41.5 billion bbls to find
– Abatement rate needed ~155 Mt pa
– Current injection est. <10Mt pa
– Volume rate to add
– ~ 310 million m3 pa
– ~ 1,950 million bbls pa
– ~ A 5 million bbl / day province/venture…
What might this look like ..
• Simple Activity Analogue I – In 2013 the world produced about 90
million bbls oil per day • Rig count est.2,590 (oil only)
• On the face of it ~1/18h of the activity level is
needed for CCS
• Rig count needed est. ~140
• Actual for CCS in 2014: 0-10
• Simple Activity Analogue II – China oil production ~ 4.5 million bbl/day
• Rig count >300 (est. oil only)
• Critical supplies ? – O&G demand projected at 7,500 land
rigs in 2015 (~ doubling)
– Est. global build rate ~270 / yr
– Driven by Unc. O&G and ~$100/bbl
UQEI Energy Express #1
(source; Baker Hughes Worldwide Rig Count; O&G Journal; Bloomberg)
Slide 30
What About a Shift to Gas ?
• Good News from the US ?
• Encouraging ?
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Numbers again …
$4.20
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• Excellent coffee at Nano‟s
(source: www.energy.gov.ab.ca, www.eia.gov)
or
~1 Gigajoule of gas at Henry Hub
278 kilowatt-hours of electricity
45.5 kilograms of coal
30 litres propane
Slide 32 UQEI Energy Express #1
US Fuel – Security & Economy
• A US government report expects that the United States will become self-sufficient in oil
production by the year 2037. (US EIA, 2014)
• Energy-related emissions of carbon dioxide, the greenhouse gas that is widely believed to contribute
to global warming, have fallen 12% between 2005 and 2012 and are at their lowest level since
1994, according to a recent estimate by the Energy Information Administration (WSJ, April 2013)
• As the U.S. has reduced its coal consumption, it has increased its coal exports to Europe, which
rose 23% in 2012 from a year earlier … chief executive of French power group GDF Suez SA, says
that European utilities imported and burned that coal, raising carbon-dioxide emissions from
power plants in Europe (WSJ, April 2013)
Slide 33
And Stranded Reserves – whose ?
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Slide 34
What Investment Would NP Require
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All renewable techs,
nuclear and biofuels Transmission and
distribution for the power
sector
Share of fossil fuels is
declining mainly due to
increases in energy
efficiency
Source: IEA World Energy Investment Outlook 2014
Slide 35
Current Patterns
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(sources: IEA var and www.ediweekly.com)
Share of fossil fuels
not declining so far
Slide 36
• Various national, regional and international initiatives have been established
to address climate change:
Effective Organisation for Change ?
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Source: Keohane & Victor (2011)
Maybe the focus should have been energy ?
Slide 37
What about the MDG’s ?
• The Millennium Development Goals (MDGs) “the most successful global anti-poverty
push in history”.
• Most MDG targets conclude at the end of 2015, world leaders have called for an
ambitious long-term sustainability agenda to succeed the MDGs (and address
unfinished business).
• Sustainable Development Goals (SDGs) to address pressing global sustainable
development challenges like environmental degradation and promote sustained and
inclusive economic growth in poor countries if poverty eradication is to be irreversible.
• Notably, Goal 7 is focused on energy, conspicuously missing from the MDGs
UQEI Energy Express #1
GOAL 7:
Ensure access to affordable,
reliable, sustainable, and modern
energy for all.
Slide 38
The FF Challenge & the Emerged Positions
UQEI Energy Express #1
Acknowledgement: Robert Socolow Princeton Environmental Institute Private communication – Chris Greig
Is climate change
an urgent matter?
A nuclear and/or
renewables transition
unmotivated by
Climate Change
Renewables &
nuclear advocates
live here
► 2oC is readily
achievable
REALITY?
► 3+ oC
is a really tough
challenge
Most industry, policy
makers and public
are still here
(►5oC ?)
NO YES
NO
YES
Are fossil fuels hard to replace?
Slide 39
• Bringing this to a close …
UQEI Energy Express #1
Slide 40
Recapping: Inevitability of Growth
• Current rate of population increase
– 81.9 million p.a.
• Another 2.7 billion in cities by 2050
• Global (electricity)
– Current (2012) installed capacity – 5,520 GW ~ 0.75 kW per person
• Just to „stand still‟ we need to install
– > 60 GW / year or 1.2 GW/week
– Good news > 4 GW/week („10-‟11)
• though mostly coal ?
UQEI Energy Express #1
(source: www.eia.gov)
Slide 41
Target 5,000 kWh pp pa (electricity)
• UK levels of use (electricity only) ~ 5,000 kWh pp pa
– UK population ~ 64.11 million
• UK installed generating base supporting this ~ 93 GW
– UK installed capacity ~1.46 kW per person
• Global installed generation base ~ 5,520 GW
– Global installed capacity ~ 0.75 kW per person
• Global installation needed to match (inst.) UK ~ 10,500 GW
– Extra needed = 5,000 GW (excludes population growth effect)
– Assume a 25 year ramp up ~ 3.8 GW / week (excludes retirements)
– Additional required for annual pop‟n growth ~ 2.3 GW / week
• Assuming 25 years to bring global population to UK levels
requires the installation of 6.1 GW per week
– 2010 – 11 the world achieved 4.7 GW per week
UQEI Energy Express #1
(source: www.eia.gov)
Slide 42
• Consider energy supply needs for development for the vast majority – Long run risk not vs. but and short run certainty
• Understanding what it takes to make the wedges real – what can be engineered, procured and constructed (EPC) in a constrained world (supply & other)
– And … at what rate
– What are the „blockers‟ to major efficiency improvements from existing supply and demand
• Consider where financing and capital is really going
• Consider the installed base (& reserves) and who owns them
• Consider – what mitigation is doable … and adapt to the rest – and note that adaptation is also EPC constrained.
• Do we even understand the solution space ?
• What role Universities and R&D ?
• Consider risk and communication of risk
UQEI Energy Express #1
Wrap-up: Discussions to be Deepened
THE END - THANK YOU
UQEI Energy Express #1