Assessment of Technology Options to Address

Imperial College Centre for Energy Policy and Technology Assessment of Technological Options to Address Climate Change A Report for the Prime Minister’s Strategy Unit December 20, 2002 Note: This report was commissioned by the UK Government as a piece of independent research and is being circulated to inform and stimulate debate. The report is not a statement of the UK's government policy. ICCEPT Assessment of technological options to address climate change 2 ICCEPT Assessment of technological options to address climate change Contents Preface Executive Summary Part I: Overview and Main Findings 1. Introduction 2. The scale of the challenge and the role of innovation: energy, development and carbon emissions 3. Technological options: a summary 4. Delivering technology options: drivers and enablers 5. Conclusions: The opportunities ahead Part II: Technologies and Practices: An Assessment of Options 6. Low carbon primary energy resources Renewable energy technologies Nuclear power Carbon sequestration 7. Reducing primary energy demand through greater efficiency Buildings, appliances and vehicles Energy conversion and supply: Advanced fossil fuel technologies, fuel cells 8. New energy systems and facilitating technologies Energy storage The changing nature of electricity grids Hydrogen production, storage and use Systems innovation: the role of hydrogen and new ‘energy vectors’ 9. Assessment and cross-cutting issues 3 ICCEPT Assessment of technological options to address climate change 4 ICCEPT Assessment of technological options to address climate change Preface This report was produced in October 2002 at the request of the Prime Minister’s Strategy Unit. It aims to analyse the potential of low carbon technologies for delivering deep cuts in greenhouse gas emissions worldwide by 2050. The terms of reference requested information on: · The likely quantitative contribution of the various technologies and their costs · Key obstacles to uptake · Which technologies are best suited for different parts of the world, with reference to the OECD economies, Russia, Asia, Africa and developing regions · The technologies with the greatest potential · Factors that would affect the adoption of the technologies identified · Implications for economic growth · Challenges ahead and suggested further actions The report shows why the climate change problem could be addressed through both national and international commitments to the development and use of low carbon technologies and practices – defined here as technologies and practices that avoid or reduce net emissions of CO2 to the atmosphere. It reviews why numerous studies have concluded that countries can aspire to achieving economic prosperity on a broad basis, and the OECD countries to raising their economic livelihoods further, while addressing the climate change problem. The report has benefited from comments on early drafts from experts from industry, government and academia. In addition, a workshop on regional aspects was convened by the Carbon Trust on 29th October 2002, and an expert workshop was run by the Strategy Unit on 1 November. Persons consulted are listed at the end of the document, as are the main contributors from Imperial College London, Warwick University Business School, Future Energy Solutions and NERA. We have also benefited from ongoing work at the Department of Trade and Industry on UK energy policies. We are immensely grateful to all involved for their time and expertise. The report cannot do full justice to the enormous range of issues and options involved in rising to the challenge of reducing carbon emissions. Nor can it possibly be encyclopaedic. Any errors or omissions are the responsibility of the authors alone. December 20, 2002 5 ICCEPT Assessment of technological options to address climate change 6 ICCEPT Assessment of technological options to address climate change Executive Summary The challenge Under existing policies carbon dioxide emissions from energy use will increase substantially over the coming 50 years. The increases will be greatest in the developing countries: their energy consumption per capita is very low compared to that of the industrialised countries, they have 2 billion people without access to modern energy forms, and will need far more energy to achieve economic prosperity. With economic growth world electricity demand could expand four-fold relative to today’s level – equivalent to 10 times the installed capacity in the US, or 120 times that of the UK. World oil consumption would also rise to several times levels found in the US and Europe today, unless alternatives to oil can be found. But growth in CO2 emissions is not inevitable. The IPCC reviewed global emissions in 140 scenarios, and industry, international organisations and governments too have published their own analyses, as has the G8 Task Force on Renewable Energy. Their main conclusion is that we could move to a low carbon emissions path, and achieve a virtually zero carbon energy system in the long term, if we used energy more efficiently and if we developed and used low carbon technologies and practices. This is technologically and economically feasible. Profound changes occurred in energy production and use in the last 50 years, and profound changes seem equally likely in the years ahead when we examine emerging technologies. Technology options Reductions of emissions could be achieved by improving energy efficiency and by using low carbon-emitting energy sources. Fundamental changes in the infrastructure by which energy is supplied and used would also be needed. Energy efficiency It is estimated that one-half of future emissions, relative to trends, could be eliminated through efficiency gains, perhaps more with technical progress and if the uptake of technologies is encouraged through energy policies. Examples of options already available abound in building design, appliances, lighting technologies and transport. But the possibilities for further improvement through innovation are far from exhausted. For example, transport accounts for around ¼ of CO2 emissions, and for the bulk of the 3.5 billion tonnes of oil consumed in the world today. The ‘well to wheels’ efficiency of vehicles is 15%; new technologies such as fuel cell and hybrid- electric vehicles would double this. The use of natural gas will also be associated with large gains in energy efficiency, and is the ‘fuel of choice’ for power generation and heating in homes and industry for those countries with good access to it. It would reduce CO2 emissions directly given the lower carbon content of gas relative to oil and coal, and it has several other environmental advantages. But given the dependence of large countries such as India and China on coal, and their more limited access to gas, high efficiency coal 7 ICCEPT Assessment of technological options to address climate change technologies will also be important; those based on coal gasification may open up a path towards hydrogen production (see below). Low carbon energy sources There are three main options: renewable energy, nuclear energy, and fossil fuels with the carbon being separated out and sequestered. Renewable energy The resource is very large. For example, solar energy alone could meet world energy demand using less than 1% of land now under crops and pasture. Of course there is no need to occupy such land, since deserts and rooftops can be used for solar technologies, and several other options show great promise—wind, tidal stream, wave, geothermal energy. Biomass energy can be derived from agricultural and forest wastes, and biomass plantations can also be used to help restore degraded land and watersheds. Most of the technologies are technologically viable and many are well proven, but with exceptions their costs are high relative to fossil fuels. However, cost trends are encouraging; for example the cost of wind has fallen fourfold since the mid 1980s. Most technologies are in their infancy and there is appreciable potential for further reductions through innovation and batch production. The issue of intermittency will need to be addressed if the solar and wind technologies are to provide energy on the scale required. This will require the development of storage technologies, such as hydrogen, and changes to the way power grids are operated. Nuclear energy Nuclear fission is a familiar and well tested option; it accounts for 7% of the world’s primary energy production and 17% of its electricity production. We now have more than 40 years of operating experience with the technology. New smaller reactors, with improved safety characteristics are now being developed. The difficulties with its wider scale deployment in response to the climate change problem lie as much with the much-discussed and unresolved issues of nuclear wastes, safety, decommissioning and proliferation, as with reactor size and efficiency. For these reasons many of the studies reviewed here assign to it a secondary role or conclude that it cannot be relied upon for achieving major reductions in carbon emissions over the long term. Nuclear fusion is thought unlikely to be available commercially for 25 or probably 50 years. Hydrogen production from fossil fuels with carbon sequestration It is possible to separate out the CO2 from fossil fuels for geological storage in depleted oil or gas reservoirs, coal beds (for enhanced methane recovery) or deep saline aquifers. Doing so is a promising way to make hydrogen. These possibilities are attracting much interest since they would

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