The Energy Transition: An Overview of the True Challenge of the 21st Century

186 Pages·2017·7.014 MB·English

by  Vincent Petit (auth.)

Vincent Petit
The Energy
Transition
An Overview of the True Challenge
of the 21st Century
The Energy Transition
Vincent Petit
The Energy Transition
An Overview of the True Challenge of
st
the 21 Century
VincentPetit
Grenoble,France
ISBN978-3-319-50291-5 ISBN978-3-319-50292-2 (eBook)
DOI10.1007/978-3-319-50292-2
LibraryofCongressControlNumber:2016963066
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Foreword
In recent years,the world has gone through enormous changes.Enabled bybetter
health services, the world’s population has exploded. From 2.5 billion people in
1950, we now share the planet with over seven billion people, and it is predicted
thatthisnumberwillgrowtoninebillionbythemiddleofthecentury.
Along with the population explosion has come complete globalization and
interconnectivity. Cross-continental travel, global trade, business specialization,
and technology have gotten us, billions of people, to work together on a daily
basis, to share our innovations, and to mutually benefit from one another. Living
standardshavesoaredinmanyregions,propelledbyadvancesininnovation,health
services, and mobility. Populations once isolated now embrace technologies they
couldnotpreviouslyaccess,dramaticallyspeedinguptheirindustrial,technologi-
cal, and economic evolution. As they connect to the global economy, they also
contribute to its overall growth with their energy, their capabilities, and most
importantly,theirhopeforabetterlife.Indoingso,theyelevatetheoverallliving
standardsofthewholeworld.Asweallliveinthisdenselypopulatedworld,we’ve
alsocometotherealizationthatwe’reallinthistogether.Wesharethesameplanet,
thesameresources,andthesameclimate.Whateverourdifferences,wearebound
byacommonresponsibilitytoourcommonplanet.
The foundation of all progress, indeed, of all life, is energy. Energy makes
everythingwork:heating,lighting,water,education andlearning, health,technol-
ogy,manufacturing,andmobility.Energyconsumptionhasincreasedbyaround45
%inthelast20years.Andyet,thisisonlythebeginning,astherearestillmanyof
usonthisplanetwhodonothavereliableaccesstoenergy,includingmorethanone
billionpeoplewhodon’thaveanyaccesstoelectricityatall.Energyconsumptionis
set to increase by another 35% within the next 20 years, a continuation of the
developmentwhichstartedafewdecadesago.
Butthiscannotgoonthewayitusedto.Energyusageandgenerationarealsothe
biggestreasonsforclimatechangebybeingthelargestsourcesofcarbonemissions.
Fossil fuels still represent over 80% of the total primary energy consumed in the
world. With fossil fuels come greenhouse gas emissions, which have already
reachedanunprecedentedlevelinthehistoryofourplanetandarestillincreasing.
Theconsequencesonsustainabilityarealreadyvisible,andwillcontinuetoworsen
inthecomingdecades,ifwedonotact.Scientistshaveestimatedthatthelevelof
v
vi Foreword
emissions needs to be cut by 35% in the next 20 years to prevent catastrophic
consequences.
This,combinedwiththeforecastedenergyincreaseof35%inthesameperiod,
supposes that we invent ways to do what we do today at a carbon efficiency that
would be significantly improved (over time up to three times better than today).
Humanityisnowfacingacomplicatedequationtosolve,whichisstartingtolook
like an energy deadlock. As we have now entered an era of abundance and
economicgrowth,werequireapermanentanswertohowwecangetmoreenergy.
At the same time, this surge in the demand is creating the conditions for massive
climatedisruption,whichwillimpedeorevenhalthumanity’sprogress.
Manyofthemajorplayersaffectingthischangealreadyunderstandthedramatic
consequences of inaction and have put together elaborate plans and, in some
instances, made commitments to tame their energy consumption or produce it in
acleanermanner.Butthemagnitudeofthechangerequiresthemobilizationofall.
Thepurposeofthe“EnergyTransition”istobringasimpleandholisticviewon
thiscomplexissue.Iftheproblemis,atitsveryessence,aglobalone,thesituations
of each country and each industry will all be greatly different. The “Energy
Transition” is an attempt to provide both a global and a local perspective to this
proposedevolution.
But it’s not just an overview. It also lists solutions to the problem. In each
industry,ineachcountry,thepotentialexistsforamoreefficientuseandacleaner
productionofenergy.Lookingevenfurther,advancingtechnologyandinnovation
nowbringnewperspectiveswhichcouldradicallychangetheenergyparadigmin
whichwehavebeenlivingwithfordecades.Theimpossibleenergyequationthat
theworldisfacingnowhasachancetobecracked,andthisconstitutesasoneofthe
biggesttechnologyrevolutionsthatournextgenerationneedstostepupandlead,
one that will create jobs and innovation opportunities. The “Energy Transition”
raisesbothconcernovertheproblemandconfidencethatthischallengecanandwill
bemet.
Ourgenerationstartedthetwenty-firstcentury.Itisourresponsibilitytobuilda
futurewhichissustainablewhileenablingthedevelopmentofallonourplanet.The
energy transition is the biggest challenge we face right now in this century.
Resolved by technology and innovation, it can become another example of how
humanbeingstransformdeadlocksintomajoropportunities,reinventingtheworld
welivein.
SchneiderElectric,Chairman&CEO Jean-PascalTricoire
Contents
1 Introduction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
References. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2 HistoricalDeterminismsShapingTomorrow’sWorld. . . . . . . . . . . 5
2.1 WorldPopulationExplosion. . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
2.2 RiseofNewEconomies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
2.3 EnergyUseinIndustry. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
2.4 EnergyUseinBuildings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
2.4.1 TheBoomofInformationandCommunication
Technologies.. . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . 22
2.5 EnergyUseinTransportation. . . . . . . . . . . . . . . . . . . . . . . . . . . 23
2.6 ImpactonClimateChange. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
2.7 Summary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
References. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
3 TheEnergyIndustry:RunningatFullSpeed. . . . . . . . . . . . . . . . . . 33
3.1 OilastheMainPrimaryEnergySource. . . . . . . . . . . . . . . . . . . . 33
3.1.1 TowardsaFurtherConcentrationofOilProduction. . . . . . 33
3.1.2 ShiftofOilConsumptiontoAsia. . . . . . . . . . . . . . . . . . . 35
3.1.3 OilGeopolitics. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
3.1.4 Fast-ForwardintheNext20Years. . . . . . . . . . . . . . . . . . 37
3.1.5 “PeakOil”:TowardsaPossibleSystemBreakdown?. . . . . 40
3.1.6 OilPriceSwings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
3.1.6.1 TheLogicinOilPriceEvolution. . . . . . . . . . . . 44
3.1.6.2 Short-TermOilPrices:TheExampleofthe2014/
2015PriceDrop. . . . . . . . . . . . . . . . . . . . . . . . 46
3.1.6.3 TheMid-TermOilPrice:TheNeedtoTrigger
InvestmentsMustEventuallyPullPricesUp. . . . 50
3.1.7 Summary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
3.2 Coal:TheEnergyofNewEconomies. . . . . . . . . . . . . . . . . . . . . 55
3.2.1 TheChineseMarket. . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
3.2.2 ElectricityProductionDrivestheGrowthofCoal. . . . . . . 57
3.2.3 CoalReserves. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
vii
viii Contents
3.2.4 TheCoalMarket. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
3.2.5 Summary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
3.3 NaturalGas:StarProductoftheTwenty-FirstCentury?. . . . . . . . 61
3.3.1 TheVariousUsagesofNaturalGas. . . . . . . . . . . . . . . . . 61
3.3.2 NaturalGasProductionConcentration. . . . . . . . . . . . . . . 64
3.3.3 GeopoliticsofNaturalGas. . . . . . . . . . . . . . . . . . . . . . . . 65
3.3.4 NaturalGas:ASeriousAlternativetoCoal. . . . . . . . . . . . 67
3.3.5 NaturalGasReserves. .. . . . .. . . . .. . . . .. . . . .. . . . .. 69
3.3.6 Summary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
3.4 TheSpectacularGrowthofElectricityProduction. . . . . . . . . . . . 71
3.4.1 OverviewofElectricityProductionWorldwide. . . . . . . . . 72
3.4.2 Medium-TermPerspectives. . . . . . . . . . . . . . . . . . . . . . . 73
3.4.3 NuclearEnergy:AnEnergyinDecline?. . . . . . . . . . . . . . 76
3.4.3.1 AnEnergyinDecline?. . . . . . . . . . . . . . . . . . . . 76
3.4.3.2 RoadblockstoNuclearDevelopment. . . . . . . . . 78
3.4.3.3 Summary. .. . . .. . . .. . . .. . . .. . .. . . .. . . .. 81
3.4.4 CurrentLimitsofRenewableElectricity. . . . . . . . . . . . . . 82
3.4.4.1 IntroductiontoVariousTechnologies. . . . . . . . . 82
3.4.4.2 TheSpectacularbutCurrentlyLimited
DevelopmentofRenewableEnergy. . . . . . . . . . 83
3.4.4.3 TheMainRoadblockstoRenewableElectricity
Development. . . . . . . . . . . . . . . . . . . . . . . . . . . 86
3.4.4.4 OtherPerspectivesforRenewableEnergy. . . . . . 87
3.4.5 ElectricityMarketChallenges. . . . . . . . . . . . . . . . . . . . . 87
3.4.6 TheComplexityofElectricityPriceCalculation. . . . . . . . 91
3.4.7 Summary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
3.5 MassiveNeedsforInvestmentsinNewCapacities. . . . . . . . . . . . 94
3.5.1 GlobalOverview. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
3.5.2 PrimaryEnergyResourcesInvestments. . . . . . . . . . . . . . 95
3.5.3 ElectricityMarketInvestments. . . . . . . . . . . . . . . . . . . . . 98
3.5.4 TheEnergyEfficiencyMarket. . . . . . . . . . . . . . . . . . . . . 101
3.5.5 Summary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104
References. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105
4 TheNewEnergyParadigmandBalanceofPower. . . . . . . . . . . . . . 107
4.1 NorthAmericaIsolation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107
4.1.1 World’sTopEnergyConsumer. . . . . . . . . . . . . . . . . . . . 107
4.1.2 TheEnergy-IndependentContinent. . . . . . . . . . . . . . . . . 109
4.2 TheEnlargedArabianSea. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 111
4.2.1 OilfromtheArabicPeninsula. . . . . . . . . . . . . . . . . . . . . 111
4.2.1.1 AnEconomyStronglyDependentonOil. .. . . .. 111
4.2.1.2 TheArabicPeninsulaEconomy. . . . . . . . . . . . . 112
4.2.1.3 OilPriceandPoliticalStability. . . . . . . . .. . . . . 114
Contents ix
4.2.2 India,theGreatPartner. . . . . . . . . . . . . . . . . . . . . . . . . . 114
4.2.2.1 IndianEconomyTakesOff. . . . . . .. . . . . . . .. . 114
4.2.2.2 GrowingEnergyNeeds. . . . . . . . . . . . . . . . . . . 115
4.2.2.3 TheEnergyChallengeofIndia. . . . . . . . . . . . . . 116
4.3 TheBorderBetweenChinaandRussia. . . . . . . . . . . . . . . . . . . . 118
4.3.1 ChinaGetsBackonTop. . . . . . . . . . . . . . . . . . . . . . . . . 118
4.3.2 StrengthsandWeaknessesoftheEurasianContinent. . . . . 120
References. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 122
5 ThePathTowardsaSustainableTomorrow. . . . . . . . . . . . . . . . . . . 125
5.1 TheImpossibleEnergyEquation. . . . . . . . . . . . . . . . . . . . . . . . . 125
5.2 MassivePotentialforEnd-UseEfficiency. . . . . . . . . . . . . . . . . . 127
5.2.1 EnergyEfficiencyPotentialinIndustrySector. . . . . . . . . 128
5.2.1.1 PetrochemicalPlants. . . . . . . . . . . . . . . . . . . . . 128
5.2.1.2 SteelIndustry. . . . . . . . . . . . . . . . . . . . . . . . . . 129
5.2.1.3 CementPlants. . . . . . . . . . . . . . . . . . . . . . . . . . 130
5.2.1.4 AluminumPlants. . . . . . . . . . . . . . . . . . . . . . . . 130
5.2.1.5 PulpPaper. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 131
5.2.1.6 ElectricMotorSystems. . . . . . . . . . . . . . . . . . . 131
5.2.1.7 Summary. .. . . .. . . .. . . .. . . .. . .. . . .. . . .. 133
5.2.2 EnergyEfficiencyPotentialinBuildingsSector. . . . . . . . 134
5.2.2.1 InsulationofBuildings. . . . . . . . . . . . . . . . . . . . 134
5.2.2.2 HeatinginBuildings. . . . . . . . . . . . . . . . . . . . . 136
5.2.2.3 AppliancesinBuildings. . . . . . . . . . . . . . . . . . . 137
5.2.2.4 TowardsSmarterBuildingsandHomes. . . . . . . . 138
5.2.2.5 Energy-EfficientDataCenters. . . . . . . . . . . . . . 139
5.2.2.6 Summary. .. . . .. . . .. . . .. . . .. . .. . . .. . . .. 140
5.2.3 EnergyEfficiencyPotentialinTransportationSector. . . . . 141
5.2.3.1 LightRoadVehicles(IndividualTransportation). . . 141
5.2.3.2 HeavyRoadVehicles(Trucks). . . . . . . . . . . . . . 143
5.2.3.3 AirTransportation. . . . . . . . . . . . . . . . . . . . . . . 144
5.2.3.4 MarineTransportation. . . . . . . . . . . . . . . . . . . . 145
5.2.3.5 SmarterTransportation. . . . . . . . . . . . . . . . . . . . 145
5.2.3.6 Summary. .. . . .. . . .. . . .. . . .. . .. . . .. . . .. 147
5.2.4 RegionalPerspectives. . . . . . . . . . . . . . . . . . . . . . . . . . . 148
5.3 SpectacularWasteofElectricalEnergy. . . . . . . . . . . . . . . . . . . . 149
5.3.1 OptimizingConventionalElectricityGeneration. . . . . . . . 150
5.3.2 TheEnergyoftheStars. . . . . . . . . . . . . . . . . . . . . . . . . . 151
5.3.3 RenewableEnergiestoDriveaNewParadigm. . . . . . . . . 152
5.3.3.1 HugePotential. . . . . . . . . . . . . . . . . . . . . . . . . . 152
5.3.3.2 ThePhotovoltaicSolarPotential. . . . . . . . . . . . . 153
5.3.3.3 PhotovoltaicSolarCompetitiveness. . . . . . . . . . 154
5.3.3.4 ASolarFuture?. . . . . . . . . . . . . . . . . . . . . . . . . 158
5.3.3.5 RegionalPerspectives. . . . . . . . . . . . . . . . . . . . 161
x Contents
5.4 TowardsaCleanerWorld:FuelSwitchingStrategies. . . . . . . . . . 161
5.4.1 MoreEfficient(Smarter)Cities. . . . . . . . . . . . . . . . . . . . 162
5.4.2 AGreenerIndustrySector. . . . . . . . . . . . . . . . . . . . . . . . 163
5.4.3 RegionalPerspectives. . . . . . . . . . . . . . . . . . . . . . . . . . . 163
5.5 TheEnergyEquationCanBeSolved. . . . . . . . . . . . . . . . . . . . . . 163
References. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 165
6 Towards2100. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 169
6.1 HistoricalContinuitiesShapetheWorldofTomorrow. . . . . . . . . 169
6.2 WhatHappensNext?. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 171
References. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 172