The Energy Trilemma
I attended Warwick University’s annual conference on energy and these are the worthwhile nuggets that I took from there:
Security, affordability and sustainability. That’s it. Keeping the balance between these three elements whenever new projects are developed is crucial.
There is a curious idea: Access to mobile phones vs access to energy in Sub-Saharan Africa. Mobile phones have penetrated those communities much faster than energy — entrepreneurs and markets worked well in that case.
The link between energy & emissions depends on policy. We have enough reserves of energy, depends now what kind of reserves we want to tap into. So no, security is not a threat.
Energy production 1/3 of the energy
Transport 1/3 of the energy
Buildings 1/3 of the energy
All these need to be decarbonized by 2060.
UK is #11 in the top for countries that make the best efforts to decarbonize their society — on negative watch now since it slipped from top 10. Nuclear is shaky, offshore is not enough and coal is closing.
Everyone needs to know the big picture narrative (above). It represents a common language for collaboration and for solving problems in every industry niche. The core message was clear: put entrepreneurs to work in this space.
In order to decarbonize energy production you need some form of carbon pricing. There is a need for 2x the current investments rate in renewable energy in order to hold up to the Paris Agreement.
Policy matters a lot and then time matters a lot until the policies come into effect.
Carbon capture and storage is more complex than renewables. You could draw a parallel here between compressed air energy storage and lithium-ion energy storage.
But one viable solution long term would be to replace natural gas with hydrogen (obtained from methane) which could use the current infrastructure.
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Ian Ellison (Sustainability, Product Development at Jaguar Land Rover) “There are 4 axis in automotive now:
- Traditional efficiency — lighter, more aerodynamic, incremental methods
- Manufacturing carbon footprint, going from a waste based economy to a circular one
- Electrification and ~0 carbon energy sourcing
- Shared economy — here self driving technology and software engineering are key
In this sense, we are talking now about mobility systems — Car-as-a-Service.”
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Matt Hastings (Programme Manager at Centrica)
“Disruptive business models in the new energy world — five paths:
- Data analytics
- Capacity and constraints
- Flexibility (generation and demand)
- Storage
- Localized energy systems
In terms of energy, what do you do at the household level, community level and regional level matters a lot. Big sectors like energy, aerospace and transportation are behind the generic IT industry in terms of innovation. And that’s somewhat accepted.
Cybersecurity and trust is a central issue to all sectors.
District heating is not as as big as it could be in the UK. Top 10 countries from above do a much better job at this.” Though UK is not ready for district heating. For the moment, you’ll have to back it up with electric boilers — that is the people’s perception.
Decentralized low carbon communities — correlated with the Danish and Dutch approach.
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The importance of clean cooking → 4.3M(!) deaths/year because of dangerous conditions of coooking
1B+ people without any access to electricity
Another 2B+ people with restricted access to electricity
Two approaches: grid + big power stations (eventually built by the Chinese) or renewables + decentralized tailored grids. The first is old, heavy, risky, costly, slow to reach a community 95%+. The second is based on people’s needs, IDEO style and radically better on every axis.
Markets know best and the private sector is good at allocating capital. However, if left totally unchecked, those strengths turn organisations into hideous profit-driven mammoths.
Holistic energy planning → the idea of an “energy ladder”. First and foremost, people with no access to electricity want lighting. Then cell phones, then clean cooking, then heating and so on and so forth.
The concept of the “global south” or the developing countries. What do they do different? The pay their bills by SMS or by app → that is rather advanced compared to the paper/paperless/bureaucracy from the West. Meanwhile, some countries don’t even have a post code. That is true leapfrogging.
The energy sector has been far too subsidized and so it drives the wrong kind of behavior. If you can make something profitable under extreme financial circumstances (low priced crude oil), then that is actually a good product/service.
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If you just burn the plastics that you gather, you just replace landfill with skyfill.
In the end, if you study technology and you study behavior, you have a strong change to provide a good business and come up with great products.
The future looks localized, decentralized and close to the community.
