Myths and Realities in the Energy Sector - Part 1

This article was inspired by a post by Alessandro Blasi of the International Energy Agency (IEA) titled 10 Key Myths in Energy and Climate (link to post = https://www.dhirubhai.net/posts/alessandro-blasi-6579a66_energy-climate-electricity-activity-6594909280875401217-Hk_e). I shall look at some of the items that Alessandro has mentioned with supporting evidence and I almost completely agree with all of his points.

Why Tackling Myths is Important

In order for us to move on from where we are, we need to look at the current state of the world. We must see things as they are not as we would like them to be. Many vested interests on all sides promote their points of view and policy makers, media and the public may look at the situation through their preferred set of spectacles. This can lead to distorted decisions.

However, just because the current situation is at X, does not mean that we cannot get to Y. It just means that we are not at place Y right now and need to develop a plan to get there with costs and benefits calculated, assuming that getting to Y is what we really want to do.

Why is Energy Important?

Modern Energy is the foundation of a post medieval lifestyle. Many of the things we take for granted are based on modern energy:

• A safe food supply – with variety and abundance unimaginable in the past
• Transport – a safe comfortable journey across the world
• Light, Heat, and Cooling for comfort
• Goods that our ancestors only dreamed off, entertainment and labour-saving devices, detergents to enable hygiene
• New varied jobs – rather than the back-breaking toil of our forefathers and particularly our foremothers
• Medical treatment to save us from diseases

Westerners in OECD countries take all of the above for granted and many Asians, Latin Americans and Africans are also keen on getting these things and moving from poverty to prosperity.

People don’t really care about how these services are delivered, they just want them in a cost effective, safe, reliable, convenient and clean form.

People do not want to consume hydrocarbons, but people want the all things that hydrocarbons enable them to have. The moment another technology provides people with the above listed services, in a cheaper, more reliable, more convenient and cleaner way, hydrocarbons will go the way of the horse and cart. The process will take a long time but will happen if an effective substitute arrives. At the moment no existing technology can do what hydrocarbons can do – this might change in the future. As Sheikh Yamani said “The stone age did not end because the cavemen ran out of stone”, but plenty of stone is still being used worldwide.

Alessandro’s Myth number 1 – “Electricity = energy: wrong! - Electricity is only 20% of total energy consumed”

When some journalists talk about energy, they seem to confuse electricity or power with the total energy system. Electricity is in fact a medium sized portion of the worlds energy system. The Lawrence Livermore National Laboratory in America has complied an interesting set of charts which looks at the energy systems of many countries. The data is available here = https://flowcharts.llnl.gov/commodities/energy 

Figure 1. The LL energy flow diagram for the world in 2011. According to LL about 39% of energy is used in electricity and heating with about 15% being actually useful (the rest is waste due to inefficiency)

The portion of the energy system used to generate heat and electricity varies between countries. Ethiopia used only 1.5% of its energy system for electricity in 2011, while Iceland used 75%. France for example used a higher portion of energy in electricity generation (53%) than their western European neighbours (Germany 41%, UK 38%) due to having electric domestic heating as opposed to natural gas.

The portion of electricity may increase in the future due to more electrification, although this process may be slower than many people anticipate. The USA has had similar shares for electricity in its total energy system between 2011 and 2018

Figure 3. USA energy flow diagram (2018) and share of electricity in the energy system 2011 to 2018

The world is electrifying and many developing countries are giving more of their citizens mains electricity access as they climb towards prosperity. In 1990 only 75% of the world’s people had mains electricity access in 2016 this had increased to 88%. In 1990 only 12% of Africans had access to electricity and this had increased to 45% in 2016. In 1990 only 48% of Indians had electricity and this increased to 89% in 2016.

Figure 4. percentage of the population with mains electricity access, 1990 to 2016. (data from the World Bank)

Alessandro’s Myth number 2. #Renewables dominate electricity production: False.

Renewables (defined as mainly wind and photo voltaic solar, with tidal, thermal solar, geothermal etc as extras) get a great deal of press attention, particularly in Europe, but also in the more liberal parts of the USA. By reading the press one may think that they already dominate the energy system. The real situation is however far from this case. About 64% of electricity is generated using fossil fuels and only about 7% of electricity is generated using wind and solar. (the OECD generates about 12% of its electricity using W&S while non-OECD generates about 6%)

Figure 5. Electricity Generation by Source 1990 to 2018. Data from the BP Statistical review of world energy. (hydroelectricity has its own category)

Wind and solar have grown exponentially from essentially zero in 2000. This has been due to government policy and incentives as the public has become more concerned about the environment. Costs have also decreased significantly but wind only generates electricity 35 to 40% of the time and Solar only works when the sun shines. Most forecasts have W&S growth continuing into the future, potentially increasing five fold by 2040. However, the total share of W&S in the energy mix would go up from about 3% today to 7.5%, or 18% in the more optimistic forecasts.

Figure 6. Wind and Solar consumption since 1990

One area has particularly embraced new renewables due to the concerns of its citizens, Europe. This may be why these sources get so much attention in the European press, although the USA and China actually generate more electricity using wind and solar.

Figure 7. Countries by percentage of electricity generation using wind and solar. Note that Morocco and Chile are the only non-European countries with over 10% of their electricity generated using W&S.

Alessandro’s Myth number 3. Coal consumption is declining: false – coal use is actually still rising although much slower than in the past.

Coal is not my personal favourite fuel. It is dirty, producing NOX, SOX and particulates that cause lung disease. Mining coal is dangerous and thousands of miners die in accidents each year. Coal waste pollutes nearby rivers oh and it also generates twice as much CO2 per unit of energy in electricity generation as natural gas.

Coal use has fallen in OECD countries, particularly recently in the USA where coal has been replaced by natural gas produced by fracking. However, coal use has risen in non-OECD countries particularly China and India, which have significant indigenous and cheap coal supplies and need reliable baseload electricity.

Figure 8. Electricity generation from Coal – 1990 to 2018. Data from the BP statistical review of world energy.

Figure 9 – Coal Consumption world-wide. China consumes just over half the world’s coal. (data from BP)

Figure 10. Portion of electricity generation using coal, selected countries. Poland and South Africa have been traditional heavy coal users due to ample indigenous supplies and concerns about fuel security. The USA’s coal use has declined since 2008 (shale gas replacement) and Europe has been in decline since 1990.

Europe has a commitment to phase out coal usage as much as possible, with some countries enacting legislation.

Figure 11. Coal Usage in the EU with planned phase out.

Further myths identified by Alesandro are discussed in the second part of this article.- https://www.dhirubhai.net/pulse/myths-realities-energy-sector-part-2-alan-foum