How close are we towards Net-Zero emissions?

PREAMBLE:

Every country opted for renewables be it solar, wind or even hydrogen to achieve the committed target at the Paris Meet. Not only the individual efforts but even the collective achievement over the last 7 years would drive the trend for the future seven years with a corrective course if, warranted.

The climate change which has been a topic of global discussion for the last few decades will face litmus test at the scheduled COP 28.  The Conference of Parties (COP) 28 is scheduled by the year end at Expo City Dubai.  The year 2023 happens to be the midway - 7 years since Paris meet and another 7 years from now to 2030 – Time to take stock of emissions reduction by 43% and course correct on adaptation, finance and loss and damage. The first Global Stocktake (GST) as it is referred to would provide an opportunity for a comprehensive assessment of the progress since Paris Agreement – would help assess efforts on climate action and measures that need to bridge the gaps as well.

NET-ZERO STRATEGY:

The entire world understands the urgent need and deep emissions reduction is critical – mechanisms to incentivize innovations that drive adoption of cost-effective emissions reduction solutions.  Energy demand has never been higher and consequences of climate change so multi-dimensional – reframing the challenge of hard-to-abate energy sector is treated as an opportunity to generate greater impact.  Every Country has since then looking for an alternate to fossil fuels and the renewable which at one point of time had a low key suddenly attracted greater attention world over.  In addition to solar and wind, many even laid hands on hydrogen.  There are a few examples here to account for their progress towards ‘Net-Zero’.

In pursuit of net zero commitments; India is adopting various measures to encourage energy transition for industries in the domestic market.  Various measures are likely to be discussed during the meets of Energy Transitions Working Group (ETWG).  Bureau of Energy Efficiency (BEE) promotes energy efficient processes, equipment, devices and systems.

Methane reduction – no longer complicated or expensive

While carbon dioxide reduction is important, rapid methane reduction is equally important.  They provide cooling effect relatively quickly.  While many countries cited cost and complexity of the reduction process, International Energy Agency’s (IEA’s) new analysis and regulatory toolkit clarifies that it is otherwise.

Methane reduction of 30% by 2030 from 2020 level was launched at COP26 in 2021 under Global Methane Pledge (GMP) for almost 150 countries.  Methane is responsible for 30% of global warming since pre-industrial period.  Methane impacts not only crops, the health of communities, safety mining operations and energy security.  Principal sources of methane emissions are from coal mines to operational processes of oil and gas industry (including leaky gas).   Although GMP provides much needed push in taming climate change, being a voluntary action seems to be one major flaw – meaning that the participants will have no repercussions even if they failed their target.   Currently, countries participating in GMP account for over 50% of the total methane emissions (human activity) and 45% from fossil fuel operations.  Some countries that joined GMP found it insufficient and have drafted more ambitious strategies under national methane action plans – In fact, number of national policies are increasing rapidly. Contrarily, some other countries plan no methane reduction as they bank on fossil fuels - coal mine operations and massive gas expansion plans.

The EU and the US being the main drivers behind GMP plan to launch ‘Global Methane Pledge' Energy Pathway’ to accelerate methane reduction in the oil and gas sectors.  Nigeria aims to eliminate routine gas flaring by 2030 to achieve a 60% reduction in fugitive methane emissions by 2031.  Colombia regulates oil and gas sector emission including leak detection and repair requirements.  However, China, India and Russia, the biggest methane emitters haven’t signed GMP – China although a few methane reduction policies are not bound by any standards.  China seems to be working on national action plan since US-China Joint Glasgow Declaration.

INVESTMENTS WORLD OVER:

International Energy Agency (IEA) reveals that out of the total $2.8 trillion set to be invested in energy in 2023, $1.7 trillion would go to clean technologies – the remaining to account for coal, gas and oil.  Annual clean energy investment would rise by 24% (renewables and electric vehicles) compared to 15% rise in fossil fuels between 2021 and 2023.  Surprisingly over 90% of this comes from advanced economies and China presenting a risk of new dividing line if clean energy transitions don’t pick up elsewhere - shortfalls in emerging and developing economies barring bright spots of dynamic investments in solar in India and renewables in Brazil and parts of Middle East.

India (Adani Group) is exploring to invest $3 billion in seaport and renewable energy projects in Vietnam – Vietnam is willing to create favorable conditions for investments by Indian companies including Adani.  The share of solar and wind in India has increased to 26% (March 2023) from 9% (2011-12).  It is estimated that a capacity of 180.4 GW - 145.9 GW (Solar) and 34.5 GW (Wind) is required by 2030 in addition to 117 GW – 92.5 GW (Solar) and 25 GW (Wind) currently under implementation.  An additional capacity of 389 MW hydro is required till 2030 apart from 11,494 MW hydro projects currently under construction for benefits during 2022-2023 to 2029-2039.  The share of hydro which was 26% (end 2006-2007) has come down to 11% (March 2023).

India is likely to install 292,566 MW solar in 2029-2030 – Under construction or bid out capacity stood at 92,580 MW (2022=2030);  energy offset due to solar roof top and solar pump has been estimated at 34.8 billion units (BU) and 2.4 BU respectively; Green hydrogen production of 10 million tons as 250 BU by 2030.  The peak electricity demand and electrical energy requirement is 334.8 GW and 2,279.7 billion units (2029-2030).  Integrating high shares of renewable energy (inherently variable and non-dispatchable) brings challenge of increased flexibility requirements in the grid.  Conventional generation must be made flexible to accommodate variability and uncertainty of RES generation.

Australia announces an investment of $1.3 billion to scale up renewable hydrogen industry – under ‘Hydrogen Headstart’ program through competitive hydrogen production contracts.  Australia has the largest pipeline of renewable hydrogen projects globally with a net zero emissions by 2050.

Malaysia which generates just 1% of renewable electricity banned exports in October 2021 to promote local industry.  It has pledged to reduce greenhouse gas emissions drastically by 2030 to reach net-zero emissions by 2050.

Germany, Austria, Italy urge EU to back hydrogen projects – Europe is scaling up its production and import of renewable hydrogen to encourage fossil fuel cut in industrial processes like steel making.

Higher rates of interest, unclear policy framework and market designs, weak grid infra, financially strained utilities, high capital cost are a few factors that hold investments in other countries.

STRIKING EXAMPLES:

Asia’s clean energy champion Vietnam’s renewable energy policy mechanisms risk seems to be heading in another direction.  The country with the best potential for renewable in South East Asia deters investors and undermine its progress towards net-zero emissions by 2050.  Surprisingly, Vietnam took the renewable energy stage by storm in 2020 when they accomplished its 2025 target five years in advance which extended to even 2021.  However, regulatory uncertainty and directionless renewable energy policy impeded its progress significantly – Over 80 projects (36 developers) failed to meet deadline from the 20-year incentive feed-in tariffs (FiTs) either due to pandemic or other reasons.  These developers with a total capacity of 4.6 GW expressed concerns on new tariffs.  Awaiting governmental introduction of a more favorable FiT scheme, they requested a temporary tariff of 6.2 cents/kWh to avoid bankruptcy.  In addition, they urged government to sell power to businesses which is not in place currently.  Projects nationwide are idle while investors and developers are losing money due to regulatory limbo.

Japan still includes liquefied natural gas (LNG), coal and fossil fuel-based technology while promising its green energy transformation.  There has been pressure on Japan to quickly reduce coal and elimination plan before hosting the nest G7 meet in May.  More damaging is that it is pressing neighboring Southeast Asia to adopt similar policies.

Japan’s net-zero goal (2050) banks on hydrogen development barring a clear definition of what it considers ‘Clean Hydrogen’ – hydrogen plan involves burning fossil fuels.  It aims to produce 3 million tons annually by 2030 and 20 million by 2050.  Hydrogen is of five different types – Green hydrogen involving no carbon emissions since production involves renewable energy – made by splitting water via electrolysis.  Blue hydrogen produced by using natural gas - capturing emissions using carbon capture and storage utilization (CCSU).  Pink hydrogen generated through electrolysis and powered by nuclear energy.  Grey and brown hydrogen are the other two – produced by using coal.  Of these, blue hydrogen proves more environmentally damaging than methane gas.  Massive amount of gas is required (consider gas prices of Euro 350 /MWh) to produce this kind of hydrogen.

CARBON STORAGE:

Colorado area carbon storage hub aiming to reduce industrial emissions from cement, hydrogen and power plant and creating a community-centric model for carbon capture and storage (CCS) seems to set an example.  The US Department of Energy (DOE) awarded $32.6 million to advance carbon storage hub to Colorado School of Mines, Carbon America and Los Alamos National Laboratory. Carbon Storage Assurance Facility Enterprise (CarbonSAFE), an initiative of DOE aims at developing large-scale , commercial carbon storage projects with capacities of 50 or more million metric tons of carbon dioxide underground.  DOE’s $242 million nationwide investment is an initiative to reduce emissions from industrial and power plant in the region. CarbonSAFE is one such project.  Geologic studies are underway to identify potential sites especially promising sandstone formations.

Department of Energy (DOE), US awarded $32.6 million to Colorado School of Mines, Carbon America and Los Alamos National Laboratory towards development of carbon storage hub for the Pueblo, Colorado area.  CarbonSAFE Eos was one of the nine projects as part of $242 million nationwide investment to reduce industrial and power plant emissions in the region – aiming at community-centric model for carbon capture and storage (CCS).

HYDROGEN

New York announced $10 million initiative towards clean hydrogen research, development and demonstration projects aimed at replacing fossil fuel in electricity sector.  The new initiative is in tune with the State’s overall advancement of clean hydrogen ecosystem which includes Northeast Regional Clean Hydrogen Hub. Applicants can compete on four technical challenges for emerging research – Application to decarbonize industrial process; Production and integration with renewable (solar / Offshore wind); Nitrogen oxides mitigation in hydrogen combustion and hydrogen storage technologies (bulk storage/storage in limited footprint areas.

Harvest electricity from humid air?

Would you be interested in electricity when heat and humidity are high in the Northern Hemisphere? Engineers at Massachusetts Amherst demonstrated that any material can be turned into a device that harvests electricity from ‘humidity’ in the air – they say that air contains enormous amount of electricity.  Each droplet of water contains a charge and can produce a lightning bolt when conditions are favorable. ‘Generic Air-gen effect’ – electricity could be harvested from the air using specialized material made of protein nanowires grown from bacterium Geobacter sulfurreducens.  After the discovery of Geobacter, ability to generate electricity from air is generic.  The requirement is holes smaller than 100 nanometers because of ‘mean free path’ parameter.  A single molecule of a substance (water in air) travels before it bumps into another of the same substance. When water molecules are suspended in air, their mean path is about 100nm.

The researchers designed a thin layer of material filled with Nano pores smaller than 100 nm to allow water molecules move from upper to lower part of material.  Because each pore is so small, water molecules would easily bump into pore’s edge as they pass through thin layer – upper part carries more charge carrying water molecules than the lower thus creating a charge imbalance.  This would effectively create a battery that runs so long as humidity is there in the air. Humidity being available throughout, the harvest would be round the clock unlike intermittency challenge of either solar or wind.

CURRENT PROGRESS:

There have been many projects, plans and enthusiasm for low carbon and green hydrogen but, we seem to be racing against time as they still require years to develop.  America claims to have accounted for more than 25 GW capacity of wind, utility solar and energy storage capacity, the third largest in 2022.  However, decline in deployment volume from previous two years with a historically low Q1 2023 dampened the claim they made. Clean power comprising almost 80% dominated capacity additions in 2022.  The first quarter capacity additions across US fell 55% from a year ago (422 MW at 22 sites making it the slowest quarter for battery storage additions in two years.

New solar installations in China alone rose 59% to 87.4 GW (2022) and accounted for solar boom in Asia and are believed to end global reliance on fossil fuels.   Major banks of Asia witness a widening gap between environmental, social and governance (ESG) leaders with more than half of the 46 regional lenders making ‘little to no progress’.

Despite the cost of renewable rapid decline over the years, there are still challenges of the gap between market readiness and abatement-ready opportunity and available capital to deliver carbon reduction.  It is therefore vital that investments towards sustainable solutions need be comprehensive yet cohesive to green economy.  Agencies have stepped up investment in climate-aligned opportunities – carbon avoidance to reduce carbon emissions, carbon negative.  It is backing novel technology companies promising disruptive decarbonization.

CONCLUSION:

Decarbonizing heavy industries (Steel and transportation) even mainstream consumer activities like cooking hydrogen seems promising as a carbon-free primary fuel.  However hydrogen at $2.50 to $4.50 per Kg is rated expensive apart from difficulty in safe storage and transport - $1 per Kg would be cost-competitive.

The global economic uncertainty combined with high energy prices and fossil fuel supply instabilities failed to curb methane emissions – methane emissions topped 135 million tons with 40% due to byproduct of energy sector.  Although methane emissions are associated with gas, coal mines do contribute significantly- IEA has however come up with a strategy to guide policy-makers and corporates to coal mine methane emissions.  Understanding the setting, regulatory design and implementation are three simple steps towards achieving this goal.  While slashing methane emissions is neither complicated nor expensive, the onus lies with the methane emitters.

The countries like, Vietnam must strive hard to regain investor’s trust through a demonstrating energy policy ambition.  Measures like, adopting renewable energy technologies, ease of project approval and mandating that subsidies reflect total investment cost with a reasonable margins.

A K Shyam 373 Canarabank Layout First Main First Cross Vidyaranyapura post BENGALURU – 560 097 Karnataka, INDIA.  akshay1948@gmail.com