Transcript A Zero Carbon Vision

The Critical Path
Energy System Decarbonization
Stephen Stretton
Research Associate, Cambridge Centre for Climate Change
Mitigation Research (4CMR) http://www.4cmr.org
Founder, Cambridge Zero Carbon Society
http://www.zerocarbonnow.org
2nd June 2009
Contents
Energy System Decarbonization
•
•
•
•
•
•
•
•
Why?
Terminology
Carbon
Rough Numbers for UK (Physics)
Land
Cost
Rough Numbers for UK (Economics)
The Critical Path
2 of 21
Why?
3 of 21
Why? Energy demand is rising rapidly
Energy Demand (GW)
45,000
40,000
Reference Scenario
35,000
Fast Economic Growth - A1T
30,000
25,000
20,000
15,000
10,000
5,000
1990
2000
2010
2020
2030
2040
2050
Year
Notes
•
All energy (not just electricity) is expressed in terms of GigaWatts (GW)*.
•
1 Gigawatt = 0.75 Million Tonnes of Oil Equivalent per year = 8.8 Terawatt-Hours per Year
•
1 Gigawatt is the usual size of a nuclear power station or large coal power plant
* In agreement with the recommendations from the Royal Commission for Environmental Pollution
Sources: Reference Scenario, IEA (2004) World Energy Outlook; A1T Scenario IEA (2003) Energy to 2050
Why?
5 of 21
Carbon: Terminology
Carbon Emissions
Per Person Per Year
(tonnes CO2eq)
High Carbon
~10
Lower Carbon
4
Low Carbon
2
Ultra-low Carbon
1
Zero Carbon
0
Negative Carbon
<0
*Imports of embodied energy not included
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Technology: Terminology
Technology
LCA
gCO2eq/kwh
High Carbon Coal
~1000
Lower
Carbon
Gas
~400
Low Carbon
CCS
~150
Ultra-low
Carbon
Renewables & Nuclear?
~5 to ~50
Zero Carbon (Decarbonize Lifecycle Costs) ~0
Negative
Carbon
Reforestation
Biomass with CCS
Air capture
<0
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Carbon: All Electricity
Technologies
Source:
Parliamentary
Office of Science
and Technology
8 of 21
‘LowCarbon’
Tech.
CSD
9 of 21
Physics Rough Numbers
Total
Per Person
Carbon Emissions
600million tCO2/yr +
Imports
10 tCO2/yr
Energy
Consumption
300GW
5kW
Electricity
Consumption
~45GW
1kW
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Land
See
www.withouthotair.com
Energy
Source
Density
MWavg/km2
Biomass
~0.5
Wind
~2-3
CSP
~15
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Do Everything… to Save the Planet!
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Construction Costs
Not adjusted for load factor – Study Data (2000-6)
$6,000
Mid-range Estimate
US Data
$5,000
$4,000 EU Data
$3,000
$2,000
$1,000
$0
26 Fuel cell (dist)
23 Coal with CCS
22 Gas with CCS
21 Geothermal
18 Solar thermal conc
14 Solar PV-silicon
13 Wind offshore
12 Wind onshore
10 Biomass crops
9 Hydro electricity
8 Nuclear electricity
5 Gas-central
1 Coal-clean
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Unit
Cost
14 of 21
Unit Costs p per kWh
Levelized Costs pence per kWh
8.0
Waste & Decommissioning
Carbon Cost
Fuel Cost
O&M Costs
Investment Costs
7.0
6.0
5.0
4.0
3.0
2.0
1.0
Coal (PC)
Gas
Nuclear
£2bn/GW
Nuclear £3bn/GW
Onshore Wind Offshore Wind
Coal CCS
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Economics Numbers
Total
Per Person
GDP
£1.2trillion/yr
£20,000/yr
Public Spending
£500billion/yr
£8,000/yr
Market Value of
Houses etc
£7trillion
£100,000
National Debt
£700billion
£12,000
Other Liabilities
Old nukes / PFI / Pensions /
Banks
~£500billion?
£70bn / £100bn / £200bn / £150bn
£9,000
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Fiscal Reform
1. Tax ‘bads’
2. Remove tax on ‘goods’
3. Tax ‘rent’
• Fossil fuels are both a ‘bad’ and
a ‘rent’
• So “change VAT to CAT”
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Investment Cost & Tax Revenue
• UK needs 300GW to sustain current energy
use. 1GW costs ~£2bn.
• £600bn cost = 50% of one year’s GDP
– UK energy spend ~£100bn on energy each year
– Cost of Trident £40bn total
• £100/tCO2 (10p/kgCO2) would
–
–
–
–
–
–
Add £50 to a barrel of oil
4p/kWh on gas
10p/kWh on coal
23p/litre on petrol
Raise £60bn/yr initially
£1000 citizens income or replace VAT
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Discussion Points
• How do we scale up renewable R&D by a large factor &
coordinate internationally?
• How fast can we build a super-grid with CSP?
• Does doing one technology prevent us from doing another?
Are possible supply chain shortages ‘across’ technologies
or ‘within’ technologies
• If the cost of high and low carbon are the same, is there any
financial limit on what we can do? Does tackling climate
change then cost anything at all?
• If new technology costs more, is there a limited ‘pot’ of
subsidy to be allocated to most promising technology?
• Can ‘inflexible’ technologies promote a path to electric-car
charging, leading to further intermittent renewable power
being easily integrated?
• Market Incentives (19th Century Railways) or State
Intervention (20th Century Wars) or Both?
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Conclusions: The Critical Path
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
Public Understanding and Proposed Policy
Skills and Capacity Building
Govt Guarantee Carbon & Electricity Prices
Secure Finance e.g. with ‘Climate Bonds’
Start Energy Efficiency Rollout
Build Energy Infrastructure
Fiscal Reform: ‘VAT to CAT’
Strategy transfer around the world
Switch Transportation
Complete Decarbonization of Britain and other countries
Reforest the world
Permanently avoid fossil fuel extraction
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Thanks for your attention!
Contact me:
Stephen Stretton
[email protected]
Links:
http://www.4cmr.org
http://www.withouthotair.com
http://www.zerocarbonnow.org
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Resources
•
•
•
•
Renewables: not finite, but diffuse
Gas & Easy Oil: running out
Coal: plenty to hang ourselves
Uranium:
– ~25 000GWyr known (500GW x 50yrs)
– ~75 000GWyr estimated (1500GW x 50yrs)
• Multiplication Factors
–
–
–
–
Price-driven discoveries?
Thorium (x2)
Seawater Uranium (x50)
Depleted Uranium (x40)
Proliferation Risk?
• E.g. Fast Breeder
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Carbonomics meets Freakonomics…
Total
Per Person
Carbon Emissions
600million tCO2/yr + Imports 10 tCO2/yr
Energy Consumption
300GW
5kW
Electricity
Consumption
~50GW
1kW
Land Area
?
?
GDP
£1.2trillion/yr
£20,000/yr
Public Spending
£500billion/yr
Market Value of
Houses etc
£7trillion
£100,000
National Debt
£700billion
£12,000
Other Liabilities
Old nukes / PFI / Pensions /
Banks
~£500billion?
£70bn / £100bn / £200bn / £150bn
£9,000
23 of 21
Electricity Generation Policy
Additional Slides
Contents
• Introduction & Recap
• Low-Emissions Electricity Sources
• Heating, Transportation and Industry
• Economics of Energy
• Solutions: World / UK
• References
Introduction: Climate Change & Energy
•
Gases such as Carbon Dioxide (CO2) and Methane
absorb re-radiated heat in the ‘Greenhouse Effect’.
•
The combustion of fossil fuels such as coal, oil and
natural gas, releases CO2 into the atmosphere,
increasing this effect.
Global Concentrations of
Carbon Dioxide
ppmv
400
380
360
340
320
300
280
1959 1969 1979 1989 1999
Sources: CO2 graph shows trend shown without seasonal fluctuation. Data from Mauna Loa Observatory, Hawaii;
Cover Photo © Nasa; Temperature graph from http://www.globalwarmingart.com/ 26 of 21
Effects of Climate Change (1)
(Present Day) – Some effects already seen
Oceans damaged
Greenland ice melts (raising sea levels eventually by 7m)
Increases in
extreme
Amazon rainforest collapses, releasing
weather (e.g.
CO2
Agricultural yields fall
hurricanes)
CO2
released
Tropical diseases spread
from
Methane
World ecosystems cannot adapt
forests and
released
Soils
from peat
Hundreds of millions at risk from
Global heat
bogs &
hunger & drought
circulation
oceans?
system
Desertification of large parts of Earth’s surface
collapses?
Positive Feedback: Warming causes further release of greenhouse gases
Source: Adapted from Warren, R (2006)
Effects of Climate Change (2)
• Wholesale
desertification
of Earth
possible within
100 years.
• Large
population
centres (China
and India) at
risk
Source: Lovelock, J (2006)
Should We be worried?
•
•
•
•
•
•
•
GW is major threat.
Rational ranking of risks: GW ranks above nuclear power risks.
Still uncertainty over final emissions, final warmth, final
outcomes
‘Russian roulette with our children?’
Collective action problem
Mancur Olson (1982): “... If we finally get the information that the
ecosystem can’t take any more, then it is important that we have
the open-mindedness needed to change our views and policies
the moment decisive information arrives. Those who shout wolf
too often, and those who are sure there are no wolves around,
could be our undoing”
(Olson, M. Environmental Indivisibilities and Information Costs: Fanaticism, Agnosticism and Intellectual Progress The
American Economic Review Vol 72, No 2. Papers and Proceedings of the Ninety Fourth Annual Meeting of the
American Economuc Association (May 1982) 262-266)
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The Sovereignty of Nation-State
• A Basic precept of Domestic politics and
International Affairs
Consequences:
• Nation States can impose taxes & laws,
democratically agreed
• Nation states act ‘selfishly’ in international arena
• No strong Global institutions
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“The Tragedy of the Commons”
• Each country acts in its own self interest.
• No-one takes responsibility for the common
good.
• VERY TRAGIC
• Policies to convert away from fossil fuels may
cost nothing or a negative amount on a global
scale
• However, there are solutions that are attractive
on a national scale.
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Welfare Economics Perspective
• Have a Environmental Externality
• Need a Binding International Agreement so that
private costs = social costs e.g.:
– Global Carbon Tax or
– Global Emissions Trading
BUT
• No global government – no taxation
• International agreement difficult
• Agreements are in any case not enough
• Incentives for countries to defect
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A Simple Management Perspective
•
Have a Problem
•
Need to find Solution
•
Keep it simple!
•
Importance of leadership.
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“Business as usual” would lead to
disaster within a few decades
(2100 CO2
concentration
920ppm)
"Fast Economic Growth" (A1) Business as Usual Scenario
Low Emissions Energy
Temperature
30,000
4
3
(CO2
Now:
380ppm)
20,000
2
10,000
1
-
1990
2000
2010
2020
2030
2040
2050
Rise
Fossil Fuel Energy
Committed (CO2-induced) Temperature
Energy Consumption (GW)
40,000
(550ppm)
Dangerous
Threshold
Passed
•
Model committed temperature (the temperature rise expected as a result of emissions up to that point).
•
Note that temperature rises do not include the effect of other greenhouse gases such as methane.
•
For spreadsheet model and discussion of assumptions see website: www.zerocarbon2030.org.
Sources: Sceffer, M et Al. (2006), Defra (2006).
Conversion to a zero carbon economy +
less total energy used…
Sustainable development (lower growth) with complete conversion to lowemissions energy plus additional reductions in consumption
Danger
Avoided
!
Reduction In Use
Low Emissions Energy
30,000
Fossil Fuel Energy
Temperature
4
3
(Stabilisation
@ 400ppm)
20,000
2
10,000
1
-
1990
2000
2010
2020
2030
2040
Committed (CO2-induced)
Temperature Rise
Energy Consumption (GW)
40,000
2050
Source: IEA (2003) Sustainable Development (SD) scenario with additional reductions.
A Zero Carbon Plan
Saving Planet Earth: What will it take?
• Immediate Reductions in Energy
Consumption
• Large Increase in Sustainable Energy
Supply
• Eventual conversion of economy to
use low emissions electricity or
hydrogen
A 90% Reduction in CO2 emissions by
2030
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World Energy Consumption by Major
Sectors (excludes biomass)
Coal
Gas
Hydro
Nuclea
r
Oil
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Electricity is the Solution
Energy Source
Main Energy Vector
•
Biomass/Energy crops
Liquid Fuels
•
Biomass/Energy Crops (with
sequestration)
•
Fossil fuels with CO2 Sequestration
•
Nuclear
•
Renewables
Wind
●Solar
●Hydro
●Tidal
●Wave
●Waste
●
Electricity
All Energy By Sector
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Electricity Only
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Source:
POST
note 41 of 21
Source:
POST
note 42 of 21
Fossil Fuels - Use less!
Gas
•
Imported
•
CO2 emissions
Oil
•
•
Imported
Required for sectors which cannot be converted to electricity
(Aviation, Heavy Road Freight, parts of Industry)
Coal
•
High availability
•
But high emissions of CO2
CO2 sequestration with gas or coal?
•
Reduce CO2 emissions by 80%-90%?
•
Gas (or Coal-gas) turbines for load following
•
Cost higher than burning fossil fuels directly
Need a Large Scale Alternative to Fossil Fuels
CO2 Sequestration (With a Carbon Tax)
•
Fossil fuels burnt and CO2
then buried in underground
rock formation.
•
Potential solution for areas
with large amounts of oil &
natural gas (Middle East;
North Sea?).
•
It requires extra energy to compress CO2.
•
Does not eliminate emissions (~10% escape?).
•
Overall, perhaps an ~85% reduction in CO2 compared to natural
gas.
Sequestration is always more expensive than directly burning fossil fuels:
However, capital requirements are less than other options
Image: CO2 Sequestration From Wikimedia Commons
Renewables ~ about 11% of total UK
energy demand?
Energy Source
Max Capacity (GW)*
Hydro
0.6
Waste (Residues; Municipal; Landfill gas)
3.8
Wind (Onshore)
6.5
Wind (Offshore)***
11.4
Solar (Photovoltaic Cells)
0.1
Tidal
0.2
Wave
3.8
Total UK Renewable Capacity**
26.5
UK Final Energy Demand
230
Maximum Renewable Contribution
11%
*Interdepartmental Analysts Group estimation of maximum capacity available at less than 7p/kWh (current price 2-3p/kWh).
Apart from hydro figures from RCEP study (all large opportunities already used; small scale hydro adds <0.1GW).
**Energy Crops Excluded for Environmental Reasons (Land Area, Indirect emissions).
***Offshore wind included but note that large rotating objects interfere with UK coastal radar.
Nuclear?
Modern Nuclear Reactors
(e.g. Westinghouse AP1000
European PWR, Canadian ACR)
•
Construction time? 5-7 years
•
Compact
•
Constructors take price risk?
•
Inexpensive decommissioning?
•
Reduced fuel consumption?
•
Much less waste?
•
Price competitive with gas
•
Little capacity constraint
•
Cheap, modular, mass produced reactors for UK, China and US?
Image: AP1000 © Westinghouse 2005
Problem: Electricity is not always suitable for
transport, heating & industry
Energy Source
•
Energy Crops (0%)
•
Renewables (12%)
•
Fossil fuels with CO2
Sequestration
•
Nuclear
Can Only
Generate
Electricity
UK CO2 Emissions160m Tonnes pa
Other
8%
What about
transport,
heating and
industry?
Residen
tial-15%
Electricity
Generation
29%
Other
industries
17%
Refining
Aviation
etc
5%
6%
Road
transport
20%
Heating, Transport and Industry
Domestic heating
(currently mostly gas)
Transport
(currently oil)
Industry
(coal, oil & gas)
How do we
convert to
low
emissions
electricity?
Converting Domestic Heating
Heat pumps
• Move heat from a low temperature heat
source (such as the ground outside)
and transfer it to a high temperature
heat sink.
• Powered by electricity (from nuclear or
renewables).
• Uses up to 80% less energy.
• Using pump to heat a domestic water
tank can smooth demand & store
energy.
A heat pump uses
electricity to move heat
from outside to inside a
home. It works on the
same principle as a
refrigerator reversed.
Heat pumps use 50-80%
less energy than gas
boilers.
Heat pumps can be installed in both new and existing
houses
Image: Heat Pump theory From Wikimedia
Converting Domestic Heating (2)
The Zero-Emissions House
Ground source heat pumps
+ Better house insulation
+ Underground air circulation
+ In/Out heat exchanger
= 90% reduction in energy consumption
Combining a heat pump with a
well -insulated hot water tank
allows energy to be consumed
overnight when prices are low.
If we use non-emitting electricity (e.g. nuclear or microgeneration), CO2 emissions from domestic heating could be
reduced by 99%.
Building regulations must ensure that
all new houses have low emissions.
Converting Transport: Short distance
Electric Cars
•
Technologies developing quickly,
following success of Toyota Prius
•
Full conversion possible by 2030
Reductions in car use
•
Charge for road congestion
•
Health benefits of walking and
cycling, especially for children
•
Better urban planning & public
transport
Electric cars store energy in batteries
when recharged overnight (when
electricity prices are low).
Hydrogen fuel cell technology
developing and may be in use by
2030. Hydrogen can be produced
using next-generation nuclear power
stations.
Image: Toyota Prius From Wikimedia Commons
Converting Transport: Long Distance
Rail
•
Improve network
•
Build new freight lines
•
Upgrade urban transit
systems (Crossrail)
•
Reduce ticket prices
Aviation
•
Tax aviation more heavily
(noise, CO2, congestion)
•
Ban night flights
Travelling by rail uses much less
energy than travelling by car or by
plane.
Image: Eurostar
Converting Industry
• Imposing a carbon tax without a low-emissions
alternative would encourage industry to leave.
• Industry requires a secure, reliable and cheap
alternative energy source.
• Nuclear electricity is low cost (especially at
night) and provides a secure and independent
source of energy.
• Some (heavy) industry cannot be converted.
• There is currently no other solution than nuclear
energy.
CO2 Reduction Target
• UK Target: CO2 emissions 80% reduction on 1990 levels by
2050
• Sweden recently adopted same target
• Significant progress (30% reduction) by 2030
• Aim is that such cuts, if adopted worldwide, would avoid
‘Dangerous’ Climate Change
• More recent evidence suggests even deeper cuts may be
required
• Some countries may not cooperate, so perhaps UK cuts
need to be even deeper to compensate/lead?
• Is a near-zero carbon economy economically feasible?
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Security of Supply
•
•
•
•
North Sea oil and gas are running down.
Natural Gas provides a large and increasing proportion of our
supplies
Britain now net importer of gas
Possible Fuels:
–
–
–
–
Natural Gas from Algeria, Russia...
Oil from Middle East…
Coal: reserves are local (but most mines have closed; environmentally
very damaging).
Uranium from Australia and Canada.
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Where is the Oil?
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Energy Security
Total Energy Exports (GW)
Net Energy Exporters OECD North America
OECD Europe
1500
OECD Asia
Non-OECD Europe
Former USSR
1000
China
India
500
Rest of Asia
Latin America
Africa
0
Middle East
-500
-1000
Net Energy Importers
Source: IEA57
(2005)
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Economic Efficiency
A solution that maintains material prosperity:
a) People wish to maintain a comfortable standard of
living
b) British policy will be more influential if we are seen
to be prosperous
c) Balance of payments
d) Sustainability and demographic transition requires
‘genuine saving’ (capital investment).
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Risk(1)
YOLL = Years of Lost Life Expectancy
Total Global Energy Consumption ~100 000Twh globally/year – Nuclear 2500Twh globally/year
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Risk (2)
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Nuclear Proliferation?
Total Primary Energy Used Equivalent to
10 Billion Tonnes of Oil per year
or 14 Billion Kilowatts
Have
Existing
Nuclear
Industry
OECD North America
OECD Europe
OECD Asia
Non-OECD Europe
Former USSR
China
India
Rest of Asia
Latin America
Africa
Middle East
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Major polluters already
have a nuclear industry
Total CO2 Emissions
= 25 Billion Tonnes per year
OECD North America
Have
Existing
Nuclear
Industry
OECD Europe
OECD Asia
Non-OECD Europe
Former USSR
China
India
Rest of Asia
Latin America
Africa
Middle East
*Does not include CO2
emissions from
deforestation
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The French Experience
• Major building program 1970s – 1990s.
• Now 80% of electricity is generated by
nuclear.
• Realised economies of scale by using one
design.
• Often with duplicate units on same site.
• France now has the lowest electricity
prices in Europe.
• Electricity is a major export good.
What makes a difference?
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Nuclear: What are the Constraints? (1)
Uranium Reserves?
•
Concentrated in stable countries such as Australia and Canada.
•
Sufficient for a large expansion in the nuclear industry.
•
Fuel costs are only a small part of cost of nuclear – rises in Uranium
price will lead to more reserves becoming economic.
•
Fast breeder reactors or Thorium can take over if Uranium becomes
scarce.
•
New technologies (chemical nets) are being developed for efficiently
extracting nuclear from seawater with low energy expenditure:
Uranium in sea water is replenished constantly, so it is practically
unlimited.
•
UK has large existing supplies of Plutonium (100 tonnes: 2/3 of
global civil separated uranium) which can be burnt in ‘Mox’ fuel.
•
Globally, decommissioned nuclear weapons are also a potential
source of fuel.
Nuclear: What are the Constraints? (2)
Available Sites
• Some nuclear reactors (first few) can be based at existing sites.
• New reactors much more compact: more than one reactor can be built in each
place.
• For a 100GW expansion, perhaps 50 new sites (not threatened by flooding or
coastal erosion) should be found across Britain. Need public information
campaign about new reactors.
• Public acceptability of nuclear will increase if it is seen as a solution to the
problem of climate change.
Skills
• Main constraint for the UK.
• We need a massive program to train of the order of 100,000 new nuclear
engineers over the next few years.
• Better science/maths at school (teacher pay?).
• Sponsorship programs for young engineers.
Nuclear Costs and Risks
•
•
•
•
100 GW of new nuclear capacity in UK
Cost: £20bn pa over 10 years
Approximate Cost ~ £2bn per GW.
Could be built in private sector (or partnership of public and
private)
• Government must reduce financial risk for private investors:
– Some government help with initial planning and regulatory issues.
Need to ensure standard designs (EPR, AP1000, ACR) to achieve global
economies of scale.
– Guaranteed minimum prices.
– ‘Non-carbon’ obligation?
– Strong statement of intent.
– Some direct public investment?
– Electricity market design to encourage private investors in nuclear.
– Price guarantees can massively reduce financing cost but need not put
the government at financial risk (since government has control over
carbon taxes).
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Benefits of this Plan
a)
b)
c)
d)
Britain would have sufficient, secure, low emissions, lowcost energy for 50 years.
Strategic independence.
Massive reduction in CO2 emissions.
If internationally standard designs were used, there would
be beneficial effect on economics of nuclear power worldwide:
a)
b)
e)
f)
g)
Reduced uncertainty for investors:
Learning by doing and economies of scale.
British industry would have a low cost low carbon energy
source. Governments could put up taxes on carbon without
industry moving abroad.
Britain would give a moral example on CO2 emissions to the
rest of Europe and world.
Market Design innovations would aid US policy makers
Summary
•
To prevent ‘dangerous’ climate change we need to act rapidly.
•
We must invest in all low-emissions technologies.
•
Nuclear can generate a large part of our total energy (not just
the part that is currently electricity).
•
If UK built 100 or so low-cost mass-produced passively safe
modular nuclear reactors, the world would have a safe, clean
unlimited supply of power that would be cheaper than all fossil
fuels.
•
Cars and domestic heating can be converted to run off
electricity. More freight can be transported by rail.
•
Cuts in consumption (e.g. aviation, long distance car use) are
also necessary.
Economic Policy
• Shift entirely from Taxing Jobs and
Investment to Carbon Tax (see Stern report;
Adrian Wrigley’s presentation on Wiki)
• Specific Electricity Price Guarantees in the
Power Sector
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Existing Economic Instruments
• Climate Change Levy: A tax on industrial
users of energy. Levied in terms of energy
content not carbon content.
• Renewables Obligation: substantial incentive
for renewable forms of energy
• EU Emissions Trading Scheme: ‘cap and trade
scheme’
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What is the Renewables Obligation?
• The Renewables Obligation requires licensed
electricity suppliers to source a specific and
annually increasing percentage of the electricity
they supply from renewable sources. The current
target is 6.7% for 2006/07 rising to 15.4% by 2015/16.
It is expected that the Obligation, together with
exemption from the Climate Change Levy for
electricity from renewables, will provide support to
industry of up to £1billion per year by 2010.
• At the end of 2005, generation from renewable
sources eligible under the Obligation stood at 4%.
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What is the Climate Change Levy?
•
Climate change levy (CCL) is a tax on
electricity, gas, coal and liquefied
petroleum gas (LPG) used for energy,
and is levied on the non-domestic
sector. The levy is intended to
encourage business to use energy
more efficiently and is designed to help
the UK meet its targets for cutting
greenhouse gas emissions – in
particular, to reduce carbon emissions.
More broadly, improving energy
efficiency also helps businesses to
reduce their energy costs and makes
them less vulnerable to energy market
volatility.
Commodity
Legal Rate
Pence/kWh
Electricity
0.43p/kWh
0.43
Natural Gas
0.15 p/kWh
0.15
LPG
0.96 p/kg
0.07
Coal
1.17 p/kg
0.15
Charged on all
electricity (including
nuclear)
73 of 21
Cost of Fossil Fuels Rising
Cost of Fuel
Oil
Gas
Coal
(100
years)
(200
years)
Amount
Extracted
74 of 21
Other Fuels?
Cost of Fuel
Uranium
Solar
Amount
Extracted
75 of 21
Diminishing Returns
Energy Efficiency: easy to make small changes:
hard to make large improvements
Technology: greater investment, the lower the
price: ‘learning by doing’
76 of 21
“Learning
by Doing”
77 of 21
Energy Supply in USA
78 of 21
Carbon
Tax
Effects
of
Different
Rates
79 of 21
Cost of Generating Electricity
80 of 21
Cost with and without Carbon tax
81 of 21
Cost Breakdown
Gas (CCGT)
Coal (IGCC)
Wind
(offshore)
Nuclear
Fission
82 of 21
Cost: Assumptions
83 of 21
84 of 21
Note the methodology used for standby
generation in this study has been
disputed, but that wind has systematic
impacts on the electricity grid (associated
with intemittency) with an associated cost.
85 of 21
Current 2020 CO2 target implies
electricity decarbonisation by 2020
Source: John Bower, Oxford Institute for Energy Studies (OEIS)
86 of 21
Why is there under-investment in
electricity generation capacity?
•
•
•
•
•
Too much financial risk.
Uncertainty over:
Future price of Carbon
Future electricity prices
Future fuel prices
87 of 21
Volatile Energy Prices
(Gas, Oil and Electricity)
88 of 21
A Solution for the World?
Source: IEA89
(2005)
of 21
A solution for the UK?
Energy
Emissions
Intensity*
Total Emissions
(GW)
(t C/ GW)
(Mt CO2 / year)
2005
230
2030: Reductions in Use
70
Nuclear**
100
0.04
3.85
Renewables***
25
0.04
0.99
Coal-Gas with (partial) Sequestration#
20
0.13
2.63
Oil ##
15
0.55
8.21
Total
160
0.26
15.7
Reduction in CO2
Emissions:
162
90%
*Emissions intensities include whole lifecycle (so emissions in construction are allocated across lifetime of
reactor.
**Does not include excess heat used in industry and homes or desalination
**Also excludes any contribution from next-generation nuclear plants (hydrogen production?)
*** Entire capacity used, except energy crops (excluded for environmental reasons: land area/indirect
emissions)
***Renewables (mostly wind) assumed to have approximately same emissions intensity as Nuclear.
# Using gas turbines with CO2 Sequestration (85% reduction in CO2 eliminated relative to gas alone).
## For Aviation, Heavy Industry, Road Freight etc Also includes other unavoidable CO 2 emissions
Now
Zero Carbon 2030
Trains
Total Energy 230GW
Other
3%
Electricity
17%
Gas
Residen
tial-20%
Oil for
Road
Transport
24%
Gas Other
13%
Oil:
Industry/
Other 15%
Electric Cars
Oil for
Aviation
8%
UK CO2 Emissions162 Million Tonnes pa
Other
8%
Residen
tial-15%
Electricity
Generation
29%
Heat Pumps
Other
industries
17%
Refining
Aviation
etc
5%
6%
Road
transport
20%
Total energy = ‘Final Energy’ net of refinery and generation losses
2030: Total energy does not include other uses for nuclear heat.
References
Beckjord, E. et al. / MIT (2003) The Future of Nuclear Power, An Interdisciplinary MIT study, MIT Press, Cambridge,
MA
Budyko, M. I. (1982), The Earth’s Climate: Past and Future, Elsevier, New York
Comby, B. (2006), Environmentalists for Nuclear Energy, Canadian Edition (www.ecolo.org and www.comby.org )
Defra, (2006) Avoiding Dangerous Climate Change, Cambridge University Press, Cambridge / www.defra.gov.uk
DTI (2006) 'Our Energy Challenge', Energy Review Consultation Document / www.dti.gov.uk
EPICA (2004) Eight glacial cycles from an Antarctic ice core Nature 429, 623-628
IAEA (2000) Annual Report
IEA (2003) Energy to 2050 Scenarios for a Sustainable Future
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IEA (2005) Key World Energy Statistics
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Lovelock, J (2006) The Revenge of Gaia, Penguin, London
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Antarctica. Nature 399: 429-436
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http://www.agu.org/journals/gl/gl0610/2005GL025044/
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(2006)
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Wikisource Images use http://en.wikipedia.org/wiki/GNU_Free_Documentation_License
World Energy Council (2000) Energy For Tomorrow's World