1. Next Generation Alternatives: The Future or Flavor of the Month? Part A
Peter Schwarz Professor of Economics, Belk College of Business and Associate, Energy Production and Infrastructure Center (EPIC) UNC Charlotte
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2. Outline Introduction What is a Next-Generation Energy Alternative?
Next-Generation Renewable Energy
Next-Generation Non-Renewables
Other Next-Generation Alternatives
The Role of Markets and Governments in Next-Generation Technologies
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3. Introduction (1) Have you heard about_____? Is the new idea the next
Washington State
Inject CO2 into underground lava flow (basalt). After several years, CO2 will harden into rock.
Introduction (1)
Have you heard about_____?
Is the new idea the next
Hydraulic fracturing/horizontal drilling?
Or the next cold fusion?
Dr. Martin Fleischmann, right, an electrochemist at England's Southampton University, and Stanley Pons, chairman of the University of Utah's chemistry department, appear before the House Science, Space and Technology Committee 4/26/1989 to discuss their controversial and still disputed work in the field of cold fusion. Credit: Bettmann Getty Images
Fuel cell carbon-capture technology.
Carbonate fuel cell that will be used to concentrate and capture a portion of the carbon dioxide emissions from a  power plant as part of the fuel cells' power generation process.
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4. Introduction (2) Economics Provide proper incentives
Highlight market failures
Consider role for government
Using incentive-based rather than command-and-control programs
No one is omniscient
Neither economists nor government
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5. What is a Next-Generation Alternative? (1)
Next (or Second) Generation Alternatives
Not yet commercially feasible
Research phase
Technology still unsettled
Current cost prohibitively high
Infrastructure not yet in place
We could separate into “next generation” and “beyond next generation”
Technically feasible vs. not yet feasible
However, we face considerable uncertainty on which one will reach commercial feasibility first.
So where prospects look reasonable, we’ll consider both.
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6. What is a Next-Generation Alternative? (2)
Example: Next-Generation Alternatives to the Automobile Internal Combustion Engine
Electric vehicles (Tesla, Nissan, Chevy, GM; Porsche, Faraday, Apple, Google)
Tesla
Luxury sedan
Mass-market model - $35 K before subsidies
Tax credit of $7,500
May be additional state incentives
Can reserve one with $1000 deposit
Available by end of 2018?
Tesla wants to sell without dealer network
North Carolina is among states that prohibit selling cars without a dealer
Buy from website
Tesla delivers car to local site
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7. What is a Next-Generation Alternative? (3)
Hydrogen vehicle
Promoted ($1.2b) by former President George W. Bush in 2003 State of the Union address
First car driven by child born in 2003 would run on hydrogen and oxygen
Emit water
No other emissions
Separate from water*
Requires energy
Fossil fuel?
Technology at junction
Hydrogen replacing traditional fuel in combustion engine
Extremely limited refueling stations, except for CA
Limited H transportation infrastructure
Hydrogen fuel cell
Toyota in forefront of private-public effort to develop affordable H vehicle
Mirai Fuel-Cell vehicle (close to $60,000 unless incentives. Three years free fuel, but no H filling stations!)
Honda also pursuing.
(Author of this text worked on a proposal with UNC Charlotte faculty on new method to produce hydrogen.)
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8. What is a Next-Generation Alternative? (4)
Bush also promoted biofuels
Promoted ethanol
Corn-based
Switchgrass – announced in 2006 with goal of competitiveness by 2012
Uses non-food prairie grass
Takes a lot of energy to produce fuel
Want to provide incentives through market
Not government picking winners.
Natural gas vehicles would be likely prospect for growth
Hydrogen, natural gas hard to compress
Requires large tank
CNG vehicles
Fuel more expensive
Other plant wastes,
food wastes, recycled grease, even human waste.
Anaerobic digestion. Release and capture bioenergy. Can be used for heating, electricity, transportation fuels.
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9. What is a Next-Generation Alternative? (5)
Incentives to Develop
Reduce GHG emissions
If no carbon price
Candidate for 2nd-best alternative
Next-generation biofuels will use waste products rather than food products.
Current generation drive up price of food.
More attention to net energy considerations
And life-cycle emissions
Including extraction and transportation
High energy prices
OPEC gives an incentive every time it seeks to raise the price of oil by restricting supplies.
Peak oil concerns in conjunction with growing population
Right now, more talk about peak oil demand than peak oil supply
If we’re approaching peak oil demand, less incentive to develop alternatives.
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10. What is a Next-Generation Alternative? (6)
Long-term incentives
Promoting R & D
Public goods characteristics
Underprovided by market
Unless patented discovery, R & D is non-rival and non-excludable
If patented, monopoly right
So markets still underprovide
Subsidies
Awards
Xprize
$20 million for breakthroughs to convert CO2 into useful products
Including alternative fuels
Still contains an element of picking winners
And how large a prize needed?
And how to support continuous R & D vs. one-shot game?
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11. Next-Generation Renewable Energy (1): Wind, Solar, Biomass
Directly reduce costs: Lower capital and O & M costs.
Indirectly reduce costs: Higher reliability and capacity factor
Incremental
Redesigning turbine blades to capture wind more effectively
Novel
Suspending wind apparatus in upper atmosphere to capture stronger, more consistent winds
Similar to kite or glider
Tethered
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12. Next-Generation Renewable Energy (2): Wind
Onshore
U.S. Department of Energy funds projects
Taller towers to increase capacity
Rotor blades lighter and longer
Redesign to work at lower wind speeds
Increase blade longevity
Drivetrains—gearbox and generator—more reliable
Majority of wind power failures happen here
Operate at lower speed
Control systems better able to measure availability of wind and optimal use.
Yaw mechanisms
Control angle of blade to wind
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13. Next-Generation Renewable Energy (4): Wind
Offshore
Currently much more expensive
More expensive to build offshore
Greater punishment of ocean conditions
More expensive to connect to grid
Concerns about marine life
Use of ports, vessels, supply chain infrastructure
Rewards:
Better wind
Less effect on viewshed
Could provide more capacity
U.S. DOE supporting projects
Technology development
Market acceleration
Advanced technology demonstration
Floating platforms
Withstand greater corrosion
Reduce maintenance, given costs of transporting labor and equipment from shore
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14. Next-Generation Renewable Energy (5): Solar
First-gen
Solar PV vs. thermal
PV uses sun’s light to generate electricity
Lower levelized cost
Half of cost of solar thermal
Thermal collects sun’s heat and stores for water heating, possibly home heating.
Solar PV today
Silicon widely available and cheap
Relatively inefficient at converting sunlight into electricity
Alternatives: Thin-film technology
If cadmium used, could have health effects.
Solar thermal today
Concentrated Solar Power
Can create heat and steam needed for electricity generation
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15. Next-Generation Renewable Energy (6): Solar
Solar PV
Solar panel innovations
New solar panel materials
Perovskite –supported by U.S. DOE SunShot program
Conversion could double capacity factor from 33% to 66%.
Found in Russia’s Ural Mts.
But synthetic can be produced cheaply and easily
Unstable in air
Need stable outer layer
Other than lead.
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16. Next-Generation Renewable Energy (6): Solar
Solar Thermal
Air conditioning (!)
Requires heat to turn chemical refrigerant from liquid to gas
U.S. DOE supports projects to improve the compressor
Compresses the refrigerant
Solar thermal can reduce work of the compressor.
SunShot aiming to reduce levelized cost
Reduce costs of components as well as O &M costs.
Utility scale efforts to use solar thermal in combination with coal and NG to produce electricity
Lower emissions
Needs to be sufficient solar intensity.
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17. Next-Generation Renewable Energy (7): Biofuels
Switchgrass competitive at $5.26/gallon.
Corn stover
Non-food part of corn plant
Cheaper than switchgrass, but more expensive than ethanol
Miscanthus
Not native to U.S. but could be introduced
Comparable in cost to corn stover
But lower carbon emissions
Algae, seaweed actually 3rd-generation
From aquatic organisms
More costly than plant-based biofuels
Other uses for algae more profitable
Competitive at Carbon price of $100/ton.
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18. Next-Generation Renewable Energy (8): Biofuels
Next Generation Biofuels
Jatropha
Only competitive at oil price of $100/barrel
Cheaper than switchgrass, but more expensive than ethanol
Food and vegetable oil
Anaerobic digester
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