Tag: energy

Posted on

What’s the outlook on energy for Europe?

Analysis: a year on from Russia’s invasion of Ukraine, volatility continues to be key theme shaping the energy landscape

“It’s been an incredible year of volatility and uncertainty right across all energy markets. Unfortunately that is likely set to continue across 2023, even one year after the invasion,” says Dr Paul Deane, research fellow at the MaREI, the SFI Research Centre for Energy, Climate and Marine at UCC. “Even though we’ve moved away from using a lot of Russian gas over the last year, we’re still relying on the global supply of Russian gas and there hasn’t been any significant structural changes to global gas markets. So we’re essentially shopping in the same global supermarkets, for the same amount of gas and there’s actually less gas available.”

Russia’s invasion of Ukraine in February 2022 fuelled an energy and cost of living crisis across Europe, as well as concerns about energy security and a reappraisal of the energy system. The crisis saw people looking to alternatives to cut their energy bills, from turning down the thermostat to switching to wood burning. Like in Greece, where loggers in the north worked hard to keep up with rising demand. Meanwhile, Swedish and Finnish producers of pulp and paper experienced record profits.

The sudden change in the energy landscape also fuelled a renewed focus on green solutions from governments and businesses. Swiss parliament approved a “solar offensive” bill, aiming to speed up construction of solar parks to help avoid winter energy shortages, and as one climate economist argued, the high energy prices could be seen as necessary for energy transition. Meanwhile, Governments took a number of different fiscal policy measures to help households and companies cope with the rising bills, from tax breaks to price caps to credit schemes.

We need your consent to load this rte-player contentWe use rte-player to manage extra content that can set cookies on your device and collect data about your activity. Please review their details and accept them to load the content.Manage Preferences

From RTÉ Radio 1’s Today with Claire Byrne, why is the drop in gas prices not reflected in our bills?

Before the war Russia supplied nearly 40{6d6906d986cb38e604952ede6d65f3d49470e23f1a526661621333fa74363c48} of Europe’s gas. But the EU’s reliance on Russian gas has more than halved and is now down to under 15{6d6906d986cb38e604952ede6d65f3d49470e23f1a526661621333fa74363c48}. Instead, the EU has leaned more heavily on gas imported from Norway, as well as from Algeria, the US, Qatar and Nigeria. As of February 2, 2023, EU gas reserves are on average 71.64{6d6906d986cb38e604952ede6d65f3d49470e23f1a526661621333fa74363c48} full, according to Gas Infrastructure Europe, and gas prices have returned to levels last seen in late 2021 before the war.

But because there’s been no structural changes, we would expect gas prices to remain high throughout 2023, Deane says. At the moment we’re seeing a significant drop in natural gas prices internationally, particularly in Europe, but prices remain comparatively high.

Three things have really determined the price of natural gas over the last year: the war, the global economy and the weather, says Deane. We feared a cold winter, but the weather has been incredibly mild, which significantly reduced the demand for natural gas around Europe, taking pressure off the supply. Deane explains that the data shows the drop in gas use is particularly seen across residential users who haven’t needed to heat their homes as much, especially in Germany where natural gas would be used a lot.

We need your consent to load this rte-player contentWe use rte-player to manage extra content that can set cookies on your device and collect data about your activity. Please review their details and accept them to load the content.Manage Preferences

From RTÉ Radio 1’s Morning Ireland, Bloomberg’s Javier Blas explains impact of unseasonable temperatures on European wholesale gas prices

“The other thing that played into Europe’s hands is the Chinese economy. Particularly as we came towards the end of 2022, the COVID lockdowns in the Chinese economy really suppressed demand growth within their economy, that then reduced the global demand for gas,” he says. “We’re in a much healthier place now than what we would have thought we were going to be, let’s say, 12 months ago. But primarily for factors outside of our control. That’s why we think that prices will remain high across 2023 and the new feature will be volatility.”

One the one hand, if the weather stays mild, prices will stay down. But if there’s a quick economic rebound from the Chinese economy, we’d expect prices to go up very quickly again and very sharply, says Deane. “Unfortunately we’re not out of the woods yet and we’re in an era where the new normal is high electricity prices and the root cause of those electricity prices is the price of natural gas and the drivers of the price of natural gas are outside of our control in the short term.”

On January 23 this year the European Commission launched a consultation on the reform of the design of the European energy market, to protect against the volatility and insecurity of the current market. “They’re looking at a number of measures around restructuring electricity markets, about putting in more price flexible plans for consumers, about looking at new technologies. But a lot of those things are relatively cosmetic, they won’t make a significant change,” Deane says.

Timeline of EU response to the energy crisis

  • March 24-25: Leaders of the 27 EU member states agree to phase out the EU’s dependence on Russian fossil fuels as soon as possible (Versailles Declaration)
  • May 30-31: European Council agrees ban on almost 90{6d6906d986cb38e604952ede6d65f3d49470e23f1a526661621333fa74363c48} of all Russian oil imports by the end of 2022
  • June 27: European Council adopts new regulation on gas storage to ensure member states’ gas storage facilities are filled before winter and can be shared between member states
  • August 5: European Council adopts regulation on reducing gas demand by 15{6d6906d986cb38e604952ede6d65f3d49470e23f1a526661621333fa74363c48} across Europe
  • October 6: EU countries adopt emergency regulation addressing high energy prices
  • November 24: European Council agrees on the content of new measures aiming to secure and share gas supply in the EU (joint gas purchasing)
  • December 3: European Council agrees on a price cap on Russian oil
  • December 19: EU energy ministers agree on new rules to set a market correction mechanism which aims to protect citizens and the economy against excessively high prices
  • January 23, 2023: European Commission launches consultation on reform of the EU’s electricity market design

The war in Ukraine has caused a fossil fuel crisis, but natural gas is the root cause of the problem that Europe need to move away from, he says. “We’ve got plans at the European level called RePower EU which is specifically to move away from Russian natural gas and in Ireland we have our own climate action plans. But we must realise that that’s going to take a couple of decades. It’s going to take a significantly long time, but we need to start that now.”

European countries tried to adopt a common approach for months, says Dr Andrea Paltrinieri, Associate Professor of banking and finance at Università Cattolica del Sacro Cuore in Milan. It finally came together in December 2022 with an agreed price cap on the TTF. The Title Transfer Facility, commonly referred to as the TTF, is a virtual trading hub for natural gas in the Netherlands that acts as a benchmark for gas prices in Europe. The cap can be triggered from 15 February, 2023.

But Paltrinieri sees the cap as a political achievement rather than a technical one and argues it will be difficult to apply even if prices were to reach such high levels again, for example due to further interruption of the flow of gas from Russia. “Moreover, [the cap] can be suddenly stopped if the supply is at risk, if the trading volume is reduced at the TTF, or if risks overcomes the benefits,” he adds. A potential cap could also cause sellers to jump away from the market or reduce flow, or see supply redirected to other markets, if the price on the European TTF market is kept below the Asian JKM (Japan Korea Marker) benchmark, for example, putting storage levels at risk, he explains.

Commenting on some of the measures taken across Europe by individual governments, he says the Spanish “tope al gas” — a form of subsidy to energy companies buying gas to produce electricity — has reduced price, but increased the overall natural gas demand at a time when reduction should be a target of each measure. Meanwhile, he says the German government were right to apply the €200 billion package but that it potentially “creates some distortion within the EU”.

The lack of diversification of supply sources takes time to be solved, he says. “Therefore right now the priority is to buy floating storage regassification unit, like Germany is doing. And I would suggest a form of EU common debt to raise money in order to help European countries.” Paltriniere says the natural gas situation in Europe will likely be in undersupply until 2025.

What measures have countries put in place?

As part of wider energy packages of tax breaks, subsidies and caps, European countries have been supporting households with payments:

  • Norway: The Norwegian government will pay 80{6d6906d986cb38e604952ede6d65f3d49470e23f1a526661621333fa74363c48} of energy on bills with prices above 0.70 crowns per kilowatt hour (KWh), with a max consumption of 5,000 KWh per month.
  • France: In France, the government has approved a package that includes capping energy price rises at 15{6d6906d986cb38e604952ede6d65f3d49470e23f1a526661621333fa74363c48} and “energy cheques” from €100 to €200 given to lower-income households.
  • The Netherlands: The government offered a €190 contribution to energy bills and a one-off energy allowance of €1,300 to eligible households.
  • Italy: Low-income households earning less than €12,000 a year have had their energy bills frozen, while a one-off payment of €200 was made to people earning up to €35,000.
  • Germany: Germany introduced a €200 billion aid package that included lump sumps of €300 transferred to taxpayers, as well as further one-off payments to students, pensioners and families in receipt of child support.
  • United Kingdom: The UK government has introduced a cap on the price of a unit of energy, in place until until April 2023, which means a typical household bill for gas and electricity will be £2,500 a year. Households reliant on electricity and gas were given a £400 energy grant.
  • Spain: People who earn less than €27,000 are entitled to a one-off payment of €200 euro. This was previously limited to €14,000.

Russia was the largest supplier of natural gas to Europe. But Ireland primarily relies on importing natural gas from the UK, specifically through two undersea pipelines coming from Scotland, so our gas markets are linked. “Although not as traditionally reliant on Russia for gas in comparison to other European countries, Britain uses gas for a greater percentage of energy supply than its peer countries,” says Professor Thomas Scotto, professor in politics at the School of Social and Political Sciences, University of Glasgow. Scotto says there is a “long game” to be played and governments should try to speed up reduced reliance on gas and improvements in energy efficiency.

Commenting on the UK measures, Scotto argues that communication has been poor and there are misperceptions about the government’s policies — “some consumers may falsely believe that everyone’s energy bill is capped at £2500 rather than a typical household being charged £2500. Communication is key and the government haven’t been good at this—much of this was a function of the chaos over Liz Truss’ short tenure in office.”

But Putin’s strategy to use energy as a geopolitical tool might not have worked as he had hoped. As weird and unusual as it sounds, the warm weather is having a huge impact on reducing hardship right across Europe at the moment, says Deane. “If we had had a cold winter in Europe this year, it would have created a huge amount of hardship for families, probably a lot of social disruption. But because it’s been so incredibly mild, it has allowed us to escape a lot of that hardship within the wider EU system and that has really gone against the Kremlin in terms of the social discord and political discord that they like to try and create. Weather has gone against them big time.”

Additional reporting by Alina Trabattoni for the European Broadcast Union‘s A European Perspective initiative.

The views expressed here are those of the author and do not represent or reflect the views of RTÉ

Posted on

Energy crisis, the five challenges for 2023

How will the map of world electricity transform? Will sky-high strength selling prices raise renewables? How will the industrial landscape shift? What will the long lasting financial impacts be? How will the vitality crisis affect climate action? These are the five important issues that scientists all-around the earth will be requested to aim on in 2023. It will be up to them to come across suitable solutions to support govt action in the coming months to offer with the crisis.

Determining the important problems in an region that has turn into vital for international politics and economics, is Simone Tagliapietra, researcher in the College of Political and Social Sciences at the Università Cattolica del Sacro Cuore, whom was commissioned by the journal “Nature” to outline some attainable strength eventualities for 2023. Together with the co-author of the posting to be posted in the conclude-of-year problem of the prestigious journal, Andreas Goldthau, director of the Willy Brandt School at the College of Erfurt, in addition to focusing on the new submit-war entire world vitality map in Ukraine, he experimented with to reveal the industrial, financial and social repercussions of the energy crisis. With a target on the outcomes-likely positive-that it will have in fostering the ecological transition.

 

“In 2022, electrical power marketplaces have been on a roller coaster”, the researchers argue. For this reason, what is about to near will go down in background as an annus horribilis. Blame it on an “energy crisis” “triggered by the Russian invasion of Ukraine” and, as a end result, the Kremlin’s “geopolitical use of purely natural fuel flows” to Europe. Thus, 2023 will be a essential calendar year to have an understanding of how the power disaster will evolve and how it will have an affect on the alternatives that will be designed globally to make certain a much more sustainable future.

 

How will the map of international power adjust? “The situations of the previous yr have basically altered Russia’s situation in global power marketplaces and the shape of those people markets. New alliances are staying constructed and outdated ones consolidated”, states Tagliapietra. For its element, the European Union is is approaching major gas suppliers this kind of as Norway, Algeria and the United States, as nicely as producers in Africa and the Middle East of liquefied all-natural gas. Russia is shifting lost European exports to Asia. Europe will see lasting reductions in its intake of all-natural gas as a end result of better electrical power performance, a change to environmentally friendly alternatives. Confronted with this scenario in 2023, “researchers want to think about no matter whether these kinds of ways are ample to compensate for shed Russian imports and avoid global provide shortages”, states Tagliapietra. 

Will sky-higher electricity costs increase renewables?

The extent to which nations can fast-monitor the switch to environmentally friendly electrical power is a essential problem for 2023. Large world oil and gasoline prices present an incentive for households and corporations to install solar panels and warmth pumps to decrease their strength expenses, as a lot of did this calendar year in Europe.

How will the industrial landscape shift?

Superior fees and restricted materials of strength will reorganize industries, which includes processes and locations. Some energy-intensive production sectors, including for aluminium, fertilizers and other chemicals, are commencing to move to places presenting much less expensive electrical power, this sort of as the United States or the Center East. Other industries are innovating.

What will the long lasting financial impacts be?

The coming 12 months will carry clarity about tendencies in ‘deglobalization’ and economic nationalism. Some economists forecast that reshoring will sluggish the international power changeover as marketplaces fragment. Researchers also need to have to check out what happens to the international division of labour that drove the progress of clear systems and slashed the value of photo voltaic panels in the 1st area – a mix of innovation in the United States, Chinese investments in producing and subsidies in Europe. If nations around the world act in isolation and do so purely competitively, this virtuous circle may possibly crack.

“The electrical power crisis is exacerbating social inequality in and amongst international locations. Susceptible households and low- and middle-income nations have been strike most difficult by electricity value hikes”, says Tagliapietra. “Researchers need to consider the implications for countrywide procedures and multilateral support, lending and development guidelines. They should really lose gentle on the extent to which rising strength poverty, strength rate shocks and vitality-induced inflation weaken social cohesion and threaten political security. Abundant nations can also be influenced, as protests in the United Kingdom and Czech Republic attest”.

How will the power disaster influence local climate action?

The ramifications here are possibly severe. Lower- and middle-money nations are uneasy with Western responses to the power crisis rich countries that are turning to coal to switch Russian imports whilst calling on poorer nations to do their utmost to decarbonize seem to be hypocritical

“Social and political scientists and economists require to recognize which bilateral, regional and multilateral mechanisms are finest placed to foster local climate finance, technological know-how transfer and capability developing as pledged beneath the Paris weather agreement. A re-examination is needed of cross-border carbon measures”, states Tagliapietra.

Process of Investigation

Commentary/editorial

Short article Title

Electrical power disaster, the five problems for 2023

Disclaimer: AAAS and EurekAlert! are not responsible for the accuracy of news releases posted to EurekAlert! by contributing institutions or for the use of any info by way of the EurekAlert method.

Posted on

Daily on Energy: How Russia’s war has reshaped the global energy landscape

Subscribe today to the Washington Examiner magazine and get Washington Briefing: politics and policy stories that will keep you up to date with what’s going on in Washington. SUBSCRIBE NOW: Just $1.00 an issue!

Supply shortages, price hikes and security: Russia’s war in Ukraine has fundamentally reshaped the global energy landscape as we know it. In the nearly 10 months since the invasion, countries have faced abrupt supply shortages, soaring energy costs, and security issues that threaten supply disruption or blackouts for millions of people around the world.

Here are some of the major energy impacts caused by Russia’s war:

1) Europe’s scramble for fossil fuels:

The EU has long been dependent on Russia for the majority of its fossil fuel imports, including crude oil, natural gas (both piped and LNG), and solid fossil fuels—placing it in a uniquely vulnerable position following Russia’s invasion of Ukraine.

The EU announced eight rounds of sanctions against Russia in response to the war, including measures directly targeting its energy sector, and Russia retaliated by steadily throttling its natural gas shipments to the EU over the summer.

Sanctions and retaliations have fractured energy trade between the two, requiring Europe to turn elsewhere. The EU has ramped up its imports of non-Russian LNG by at least 65{6d6906d986cb38e604952ede6d65f3d49470e23f1a526661621333fa74363c48} since the start of the war, in an effort to fill its gas storage tanks and avert an energy crisis this winter.

The bloc is currently in a stronger-than-expected storage position thanks to a mild autumn and lower demand from China.

Still, concerns loom large for the year ahead. The IEA warned that conditions that cushioned the EU this year will not be replicated in 2023, due to a potential full cessation of Russian piped gas and a recovery of Chinese LNG imports, which could threaten as much as half the supply needed to fill its storage sites before the 2023-2024 heating season.

2) Resurgence of nuclear energy: Some countries have extended the lives of nuclear reactors or reversed their positions on the technology due to tightening supplies of energy.

EU member states have warmed towards the idea of nuclear power as they scramble to offset Russian fossil fuels.

Germany, which had long been among the most prominent anti-nuclear voices in the EU, had perhaps the most high-profile shift: In recent months, leaders were forced to walk back their nuclear phaseout plan, which had the country on track to shut down all of its nuclear plants by the end of 2022, and instead move to extend the lifespan of its three remaining reactors. (Members of the Bundestag voted to do so earlier this month on the condition it was temporary.)

Belgium announced plans to extend the lifespan of two reactors by 10 years due to Russia’s invasion. 

And Japan has embraced nuclear power, in a major energy policy pivot following the 2011 Fukushima disaster. In August, Japanese Prime Minister Fumio Kishida announced plans to restart 17 of its 33 operable nuclear power plants, and weigh the construction of new facilities—a decision he attributed largely to the energy crisis caused by Russia’s war.

Japan, which imports 94{6d6906d986cb38e604952ede6d65f3d49470e23f1a526661621333fa74363c48} of its energy supplies and relies on Russia for 9{6d6906d986cb38e604952ede6d65f3d49470e23f1a526661621333fa74363c48} of its natural gas, has been especially hit by the price hikes caused by Russia’s war.

3) New England’s home heating oil inventory in crisis: The war has also exacerbated a home heating oil supply crisis in the Northeast, the densest-populated corner of the U.S. that relies most heavily on the fuel for winter heating, including supplies once sent from Russia.

U.S. residents who use home heating oil are poised to spend an average of $2,354 to heat their homes this winter—a 27{6d6906d986cb38e604952ede6d65f3d49470e23f1a526661621333fa74363c48} increase from the previous winter, and the highest price point in more than 25 years.

Russia’s war has been a major factor in the crisis. In March, the Biden administration announced a ban on Russian petroleum imports. The U.S. imported an average of 700,000 barrels of petroleum from Russia each day in 2021, and of those imports, most were shipped directly as refined petroleum products, such as heating oil—causing a significant supply shortage when they dropped to zero in March.

Since New England’s lack of pipeline infrastructure prevent it from receiving supply from other parts of the U.S., it will likely have to compete on the international market for costly imported supplies.

Welcome to Daily on Energy, written by Washington Examiner Energy and Environment Writers Jeremy Beaman (@jeremywbeaman) and Breanne Deppisch (@breanne_dep). Email jbeaman@washingtonexaminer.com or bdeppisch@washingtonexaminer.com for tips, suggestions, calendar items, and anything else. If a friend sent this to you and you’d like to sign up, click here. If signing up doesn’t work, shoot us an email, and we’ll add you to our list.

TREASURY GIVES GUIDANCE TO INDUSTRY ON PRICE CAP COMPLIANCE: The Treasury Department issued new preliminary guidance yesterday to help guide industries and service providers in the United States as they prepare for the implementation of a Russian oil price cap slated to take effect next month, Breanne reports.

Treasury clarified that U.S. businesses can provide certain services related to the maritime transport of Russian oil, such as trading, brokering, financing, and shipping insurance, so long as the oil is purchased at or below the capped price.

The department also introduced a “safe harbor” provision making clear that U.S. service providers who comply in good faith with the oil price cap guidance do not face penalties.

Going forward, Russia “will have two options,” Treasury officials told reporters: It can either sell the oil underneath the price cap and use Western services, or Russia can find alternative buyers.

CONOCOPHILLIPS TO BUY SUPPLY AND EQUITY IN TEXAS LNG PROJECT: Sempra Infrastructure, the operator behind the FERC-approved Port Arthur LNG project, and ConocoPhillips announced a 20-year agreement for liquefied natural gas at the pending Texas terminal.

The sale and purchase agreement provides for 5 million metric tons, or about 243.5 billion cubic feet, per year from Phase 1 of the two-phase project.

ConocoPhillips will also acquire 30{6d6906d986cb38e604952ede6d65f3d49470e23f1a526661621333fa74363c48} of the equity in Phase 1 of the project, and Conoco will manage feedgas supply to the liquefaction terminal.

Port Arthur is one among more than a dozen approved yet incomplete LNG export terminals. Commissioners just unanimously approved the Commonwealth LNG project planned for Louisiana last week, giving the sector even more capacity to supply global customers.

At least two new LNG terminals are currently under construction, including Venture Global’s facility at Calcasieu Pass. The terminal is expected to be operational in the third quarter of next year.

LABOR REVERSES TRUMP-ERA RULES ON ESG IN RETIREMENT PLANS: The Labor Department cleared the path for employers to consider environmental, social, and governance principles when choosing investment funds for their 401(k) plans, the Washington Examiner’s Zach Halaschak reports.

The department announced its roll-back of restrictions put in place during the Trump administration that made ESG considerations more challenging for employers.

Trump-era restrictions “unnecessarily restrained” plan fiduciaries’ ability to weigh ESG factors when picking investments, even when those factors would benefit plan participants financially, the Labor Department said. Its final rule on the matter will take effect in 60 days.

“Today’s rule clarifies that retirement plan fiduciaries can take into account the potential financial benefits of investing in companies committed to positive environmental, social, and governance actions as they help plan participants make the most of their retirement benefits,” said Labor Secretary Marty Walsh.

The Biden administration is crafting multiple rules to orient the financial sector toward ESG-driven investing, where it is already the default at major institutions under pressure to help facilitate a transition away from fossil fuels.

Whereas some blue states are pushing the sector to be even more aggressive in firms’ emissions reduction goals, Republican state officials are campaigning hard against ESG, investigating and punishing banks and fund managers via divestment for embracing it.

NEW YORK TO IMPLEMENT FIRST CRYPTO MINING BAN: New York is set to implement the United States’ first ban on crypto mining in an attempt to cut back on the digital currency’s effects on the environment, the Washington Examiner’s Chris Hutton reports.

Gov. Kathy Hochul signed a two-year moratorium yesterday that will temporarily pause new permits for power plants that house the hardware to “mine” cryptocurrency. The state legislature passed the moratorium over the summer as part of the larger Climate Leadership and Community Protection Act.

The legislation also directs the state’s Department of Environmental Conservation to carry out a study to determine the specific effects of crypto mining on the environment.

Crypto mining requires immense amounts of energy, subjecting the industry to scrutiny about its environmental impact. The White House, like the New York effort, recently charged the Energy Department and EPA with tracking how digital assets impact the environment and considering development of performance standards for operators.

2022 ENERGY PRODUCTION OUTPACING PAST YEARS ACROSS SOURCES: Total U.S. energy production through the first eight months of the year is up across a range of source categories, according to new estimates the Energy Information Administration published yesterday.

Primary energy production from coal, oil, and natural gas through the month of August all exceed production over the same periods in 2020 and 2021. Production from wind and solar are also up relative to the previous two years.

The numbers reflect the rebound in fossil energy demand and production from the COVID-19 pandemic lows, as well as the increase in renewable generation capacity. EIA pegs total domestic petroleum production around 12.1 million barrels per day currently, up by around 700,000 bpd compared to the same week last year.

The Rundown

Euractiv Unease grows as EU green policies take the fast lane

Wall Street Journal Looming oil-supply shock launches debate in OPEC

Calendar

Enjoy your Thanksgiving holiday, readers. Daily on Energy will be back on schedule Monday, Nov. 28.

Posted on

Shifting energy landscape creates opportunity for ‘world’s largest batteries’

LUDINGTON, Mich. — 

Sprawled like a gigantic swimming pool atop a bluff overlooking Lake Michigan is an asphalt-and-clay pond holding plenty of drinking water to produce electric power for 1.6 million homes.

It is component of the Ludington Pumped Storage Plant, which makes use of simple engineering: H2o is piped from a lower reservoir (the lake, in this situation) to an higher a single (the pond), then introduced downhill by supersized turbines that create electrical energy.

Supporters call these programs “the world’s biggest batteries” since they hold extensive quantities of potential vitality that can be employed when the power grid demands it.

The hydropower industry considers pumped storage the very best response to a dilemma hovering more than the changeover from fossil fuels to renewable electricity: in which to get ability when the sunlight is not shining or the wind isn’t blowing.

“I want we could create 10 far more of these. I appreciate ‘em,” Eric Gustad, group affairs supervisor for Individuals Strength, explained in the course of a tour of the Ludington facility.

But the utility dependent in Jackson, Mich., has no this kind of designs. Environmental and logistical worries and opportunity expenditures in the billions led Individuals Strength to promote an additional would-be site in close proximity to the lake yrs ago. It’s now upgrading the existing plant with co-proprietor DTE Strength.

Constructing a new a person “doesn’t make monetary sense,” Gustad reported. “Unless we get some help from the state or federal federal government, I don’t see it going on any time soon.”

Stuck in neutral

The company’s determination illustrates the challenges going through pumped storage in the U.S., the place these programs account for about 93{6d6906d986cb38e604952ede6d65f3d49470e23f1a526661621333fa74363c48} of utility-scale electrical power reserves. When analysts foresee soaring demand for electric power storage, the industry’s development has lagged for decades.

The nation has 43 pumped storage services with a put together potential of 22 gigawatts. Just one modest operation has been added due to the fact 1995 — and it is unclear how numerous of the additional than 90 pumped storage services now prepared will conquer financial, regulatory and logistical obstacles that have forced extensive delays.

3 initiatives have acquired licenses from the Federal Electricity Regulatory Commission, but none is currently being designed. Builders of a very long-planned Oregon facility expect work to start in 2023. A Montana enterprise that acquired a license 5 yrs ago wants to come across a utility to operate the plant and acquire its storage ability right before building begins.

By contrast, extra than 60 pumped storage facilities are getting developed throughout the world, mostly in Europe, India, China and Japan.

A graphic explaining how pumped storage plants" work

There are 43 “pumped storage plants” in the U.S., accounting for 95{6d6906d986cb38e604952ede6d65f3d49470e23f1a526661621333fa74363c48} of the nation’s utility-scale electricity storage.

(Linked Push )

“The allowing method is crazy,” Malcolm Woolf, president of the Nationwide Hydropower Assn., complained for the duration of a January hearing of the Senate Energy and All-natural Resources Committee, saying it consists of as well a lot of companies.

Though FERC permits new facilities and relicenses existing types, other federal, state and tribal places of work have roles as perfectly, spokesperson Celeste Miller said. “Every project is unique. All have different case-distinct issues,” she mentioned.

The sector suggests an financial commitment tax credit identical to what solar and wind get would give pumped storage a fairer shot. President Biden’s Develop Back again Far better approach phone calls for the tax split but is caught in Congress.

Pumped storage dates from the early 1930s. But most programs had been crafted a long time later to warehouse excess energy from nuclear crops and release it when essential.

The storage services also serve as a protection internet in sudden electric power interruptions. When a New England nuclear unit tripped offline in 2020, Woolf explained, “the lights in Boston didn’t flicker” because two pumped storage stations supplied backup electricity.

Although nuclear, coal and purely natural fuel crops can run constantly, wind and solar can’t — so the current market for reserve power most likely will improve. National Renewable Strength Laboratory products demonstrate U.S. storage capacity may perhaps increase fivefold by 2050.

“We’re likely to bring hundreds of gigawatts of clean power on to the grid about the subsequent couple yrs and we want to be ready to use that strength anywhere and whenever it is desired,” Power Secretary Jennifer Granholm claimed past yr.

Area, location, site

Working with computer system mapping, Australian Nationwide College engineers discovered much more than 600,000 “potentially feasible” pumped storage sites throughout the world — including 32,000 in the U.S. — that could keep 100 instances the electrical power necessary to assistance a world wide renewable electrical power network.

But the research did not analyze regardless of whether web pages would meet up with environmental or cultural protection requirements or be commercially feasible. Its web-site acknowledged, “Many or even most … might establish to be unsuitable.”

Environmentalists are neat toward pumped storage since reservoirs commonly are shaped by hydropower dams, which block fish pathways, problems water excellent and emit methane, a potent greenhouse fuel. Also, most crops consistently draw water from rivers.

But new models visualize “closed-loop” programs that tap a area or underground provide, then continuously cycle that drinking water between reservoirs. Water would be additional only to make up for evaporation or leaks.

The Hydropower Reform Coalition, symbolizing conservation groups, suggests it could possibly assistance this kind of projects under “very minimal situations.”

Nonetheless some are drawing resistance, like the Goldendale Electricity Storage Challenge in Washington point out. It would pipe water between two 60-acre reservoirs on reverse sides of a hill.

The facility could electrical power just about 500,000 homes for up to 12 several hours, in accordance to Rye Progress, spearheading the task. It is searching for FERC licensing and is scheduled to go on the net in 2028.

Condition regulators refused to grant the venture a drinking water good quality allow, requesting extra information, which the firm is giving with a new application this spring. Environmental teams dread hurt to wetlands and wildlife habitat, though tribes say the undertaking would encroach on a sacred web page.

“What are we keen to sacrifice to get this technological know-how on-line?” explained Bridget Moran, an associate director of American Rivers.

Developers say the project would include cleanup of the polluted decrease reservoir area.

The U.S. Department of Strength has launched a world wide web-based mostly tool to assist developers come across the greatest places.

A new Michigan Technological College analyze recognized hundreds of abandoned U.S. mines that could host pumped storage, with higher reservoirs at or in close proximity to the surface area and lower ones beneath ground.

They are near sufficient to transmission and distribution infrastructure and to photo voltaic and wind creating amenities, the report says.

“All these holes in the floor are completely ready to go,” claimed research co-leader Roman Sidortsov, an electrical power policy affiliate professor.

Aggressive long run

As the current market for saved energy grows, new systems are rising.

Texas-primarily based Quidnet Power has designed a pumped storage offshoot that forces h2o underground, holds it amid rock levels and releases it to energy turbines. The firm declared a project in March with San Antonio’s municipal utility.

Electrical power Vault, a Swiss get started-up, devised a crane run by renewable vitality to elevate and stack 35-ton bricks. When strength is essential, the bricks are reduced by cables that spin a generator.

For now, batteries are the foremost competitor to pumped storage crops, which can crank out ability for eight to 16 several hours. Lithium-ion batteries typically previous up to 4 several hours but for a longer time-period types are in the works.

“Are we heading to get to the place the place an 8-hour battery is more affordable than a pumped storage plant? That is the billion-greenback problem,” reported Paul Denholm, an analyst with the National Renewable Electricity Laboratory.

Pumped storage will continue to be a crucial player, but the cumbersome course of action for creating new plants hampers growth, mentioned Jason Burwen, a vice president of American Thoroughly clean Ability, a wind and photo voltaic trade affiliation.

“Given how rapid the electric powered business is modifying, it is really hard to go with a remedy which is 10 to 15 years away,” he stated.

Still a 2016 Power Office report stated the U.S. community has a likely for 36 gigawatts of new pumped storage capability.

Atlanta-based mostly Southern Co. is amongst corporations upgrading products to strengthen output at present plants although looking at probable new internet sites, normal supervisor Herbie Johnson explained.

“We don’t imagine pumped storage is the be-all, conclude-all, but it’s a critical element of our storage potential,” claimed Cameron Schilling, vice president of marketplaces for the hydropower association. “You cannot decarbonize the procedure without having it.”

Posted on

Where does the UK sit in the world’s turbulent energy landscape?

Photo by Christopher Furlong/Getty Images

Over the past 12 months the UK government has ramped up its ambitions in the energy and climate space, starting with the Prime Minister’s ten-point plan in late 2020. Since then, we have had a net-zero strategy and separate strategies for industrial decarbonisation, hydrogen, and heat and buildings, to name a few. In November the government hosted the Cop26 climate negotiations in Glasgow, and although progress was limited, the aim of keeping global warming to 1.5 degrees this century remains just about alive. However, for UK households there are more immediate concerns, with petrol prices hitting a record high in October, gas and electricity prices also skyrocketing, and potentially worse to come. For now, affordability relates to fossil fuels and not a future clean-energy system. 

In early December, at the World Petroleum Congress in Houston, Texas, the chief executive of Saudi Aramco, the world’s largest oil producer, warned that “the world is facing an ever more chaotic energy transition centred on highly unrealistic scenarios and assumptions about the future of energy”. It is no surprise that a speaker from Saudi Arabia, the world’s largest exporter of crude oil in 2020, is warning against a rapid shift away from fossil fuels. The reality is that in 2020 fossil fuels met 83.1 per cent of global energy demand. At the same time – energy and transport accounted for more than 70 per cent of global greenhouse gas emissions. This is why climate change policy demands a rapid reduction in fossil fuel production and consumption. Yet, the UN Environment Programme’s Production Gap report suggests that governments are preparing to produce around 110 per cent more fossil fuels in 2030 than would be consistent with limiting warming to 1.5°C, the target of the Paris Agreement. Thus, we face a global energy paradox of relative fossil fuel abundance against a fast-dwindling opportunity to use such resources.  

The current global energy crisis reflects the challenge of managing supply and demand in the context of the uncertainty of the Covid-19 pandemic. But it is also a window to the future challenge of the “phasedown”, to use the term in the Glasgow Climate Pact, of fossil fuels. It is the purpose of OPEC+ to manage oil supplies to ensure high economic returns for its members, hence their unwillingness to turn on the taps, as demanded by President Biden, especially when concerns remain that the Omicron variant will reduce in oil demand in the near term. But there are also questions about the ability of major producers, including the US, to ramp up supply should demand continue to increase with the threat of even higher prices ahead.

The global gas industry is based on regional prices and a globally connected market via waterborne deliveries of liquefied natural gas (LNG). The shale revolution has rocketed the US to potentially becoming the largest LNG exporter in 2022, vying with Australia and Qatar. Globally, gas supplies are tight and demand has surged, driven by economic recovery and a particular set of climatic conditions. In Europe deliveries of Russian pipeline gas are lower than usual and Europe’s politicians see this as a geopolitical move by the Kremlin to accelerate the approval of the controversial Nord Stream 2 pipeline. Until recently, buyers in Asia have been outcompeting Europe to attract spot supplies of LNG – those not tied to long-term contracts. However, the situation in Europe has become so dire that European prices are now even higher than those in Asia and LNG tankers bound for Asia are now being rerouted. 

[See also: UK infrastructure at risk from “cascade failure” due to climate change]

So where does the UK sit in this turbulent energy landscape? It has set aggressive climate change targets, being one of the first to commit to net-zero by 2050. It has been successful in “powering past coal”, which now accounts for less than 2 per cent of power generation and will be gone by late 2024, if not before. The UK is both an exporter and importer of oil, and imports about half the natural gas that it consumes. When it comes to oil, the UK exported about 78 per cent of the 49 million tonnes of the crude oil and natural gas liquids that it produced in 2020 and imported around 37.7 million tonnes. Questions are now being asked about whether the government should allow new licenses for oil and gas development. Even if it does, Shell’s recent decision to pull out of the Cambo oil field suggests that investors may stay away. Longer-term, there are bold ambitions to turn the North Sea into a net-zero basin supporting decarbonisation onshore. 

The UK became a net importer of natural gas in 2004. Since then, domestic production has fallen faster than demand, resulting in growing import dependence. In 2020 55 per cent of the UK gas imports came via pipeline from Norway, 42 per cent was delivered to the UK’s three LNG terminals – mainly from Qatar, Russia and the US – and 3 per cent came via the two interconnector pipelines that link to Belgium and the Netherlands; some of this is Russian pipeline gas. In the global gas crisis, the UK finds itself between a rock and a hard place, competing for pipeline gas supplies in Europe and globally for deliveries of LNG. It is the latter that have been driving UK gas prices to stratospheric levels. On 21 December the UK domestic gas price – the National Balancing Point – reached a record of 451.7 pence a therm, compared to 49.1 twelve months earlier. As natural gas accounts for 40 per cent of power generation in the UK, this increase has been passed on to electricity prices. At the same time, gas provides heating in 86 per cent of UK homes. For the moment, consumers are protected by the government’s price cap, but this has forced many smaller companies in the retail market to the wall, prompting a rethink of how the market is regulated. The losses being suffered now will be recouped later when Ofgem reviews the price cap and consumers will face significant increases in the gas and electricity prices next spring. 

[See also: When it comes to climate change the public is way ahead of the government]

Content from our partners

Feel confident gifting tech to your children this Christmas

Is Westminster best placed to make detailed funding decisions on devolution?

Bubblr’s Steve Morris on fixing the internet’s economic model

Was there anything that the UK government could have done to avoid this situation? Not really, save for revisiting its 2017 decision not to support the Rough gas storage facility in the North Sea that was closed due to increasing maintenance costs. Along with the rest of Europe, the UK is reliant on price signals to attract the gas that it needs. Of course, the longer-term solution is to “step off the gas” and accelerate the decarbonisation of our electricity and home heating systems, but that will take time and money. Natural gas also plays a key role in our energy system, backing up intermittent renewable power and meeting our winter heating demand. This gas system is enabled by pipelines and import terminals. All this needs to be maintained to ensure security and affordability as demand falls in line with our climate ambitions. The government is only now waking up to this problem, and plans to consult on the future role of gas and has promised a decision on the future of the gas network by 2026 as part of its hydrogen strategy.  

Notwithstanding the complication of the pandemic, recent events have made clear that the transition away from fossil fuels requires careful management to ensure that consumers have access to affordable energy services, increasingly from low-carbon sources. The current crisis suggests that leaving this to the market alone is likely to result in greater volatility and higher prices. In the UK the government needs to deliver on its own strap-line and turn its ambition into actions that deliver a more strategic approach to the energy transition beyond bold statements of future intent.