Energy planning for a world turned on its head

By Catherine

By Catherine Bolgar*

Data centers guzzle it. The coming Internet of Things, with the gadgets and appliances in our homes and workplaces interconnected, depends on it. A shift in our automobiles away from petroleum fuels will vastly multiply our need for it.

Solar Power Panels

Our future is powered by electricity. Demand for electricity by 2050 will increase 127% from 2011 levels, the International Energy Agency predicts, with demand in developing countries booming fourfold.

We love electricity because it’s so nonpolluting at the point of consumption. We don’t have nasty fumes coming from our refrigerators or our computers. But electricity isn’t carbon-free. Emissions from electricity generation rose 75% between 1990 and 2011, the IEA says. Increasing electricity generation to meet future demand requires a 90% cut in emissions in order to limit the rise in global temperature to two degrees Celsius.

That means not only relying more on renewables but also rethinking the entire electricity industry, from generation to distribution.

There is a big revolution occurring in the power industry,” says Martin Green, professor at the Australian Centre for Advanced Photovoltaics at the University of New South Wales in Sydney. “The whole business model has collapsed in a few years.”

Peak prices for electricity, whether in Europe or Australia, used to occur during summer afternoons. In Europe, where nuclear energy is widely used, plants had to trim output just as demand was peaking, because they weren’t allowed to dump the hot water they create into rivers, Dr. Green explains. That exaggerated the gap between supply and demand, and created even higher prices.

In Australia, many utilities were able to make their profits for the whole year thanks to summer peaks, he says, adding, “Everyone was bidding up their prices.”

However, the huge surge in solar panel installations—cumulative installed global capacity rose about 44-fold from 2010 to 2011 , the IEA says—has changed that equation, by producing the most electricity exactly at the times of peak demand: summer afternoons.

Utilities need to find a way to make money from solar. For the unadventurous ones, solar is really bad news. It’s taking away from demand for electricity,” Dr. Green says.

Renewables pose two big challenges for the power industry: They are intermittent and thus require storage or a backup, and they require a different kind of grid.

To ensure that when the wind is calm or the sky is cloudy there’s still enough electricity for peak demand, the system needs extra capacity. Average power demand in Germany, for example, is 80,000 megawatts, and peak demand is 130,000 megawatts, says Eicke Weber, director of the Fraunhofer Institute for Solar Energy Systems in Freiburg, Germany. If 80% of the energy mix is renewables, as Germany intends by 2050, such a system would need 200,000 megawatts of wind power and 200,000 megawatts of solar power—overcapacity is necessary to compensate for the times when it’s calm or dark.

So at off-peak times and on sunny, windy days, Germany would have far more electricity than it needs. “The future will be characterized by times where we have excess electricity,” he says.

One way to take advantage of the surplus is storage. Better storage, in the form of batteries or other means, is advancing. For example, electric cars that charge while parked during the day would be one way to store some solar power. Another way is to use the solar energy to split apart water molecules, releasing the oxygen and keeping the hydrogen for use as fuel.

As for backup power, “natural gas is the absolute complement for renewables,” says Oliver Inderwildi, senior policy fellow at the Smith School of Enterprise and Environment at Oxford University in the U.K. “Gas can be shut off or turned on quickly and can operate at various levels. If it gets cloudy, you can fire up a couple of turbines to make up the shortfall from solar. You can’t do that for coal or nuclear.”

The boom in cheap shale gas in the U.S. is crowding coal out of the energy mix there, he says. Building a gas-fired plant is much faster and cheaper than for coal or nuclear as well. A gas-fired plant can be built in 18 to 36 months, versus about six years for a coal plant.

In much of the world, however, gas is more expensive than coal. India and China are building coal plants to meet electricity needs, but they are locking themselves into a high-carbon infrastructure over the long term, Dr. Inderwildi says. The catch, he adds, is “CO2 is a global problem. It doesn’t matter where it’s emitted.”

The other challenge with renewable energy is distribution. The dispersed nature of renewable sources, such as rooftop solar panels, makes planning difficult.

The grid network is moving away from centralized plants to more distributed generation: wind, solar, biomass and other options,” says Dr. Green. “Some costs and benefits arise from that. You don’t have to have power lines carrying the same density of power. You used to have electricity flowing out from power plants in one direction. Now a lot of electricity is flowing the other way. The grid needs upgrading.”

Solar panels in front of wind turbines and mountains

And since the cost of maintaining and upgrading the grid’s assets is typically bundled into the cost of electricity consumption, people who generate renewable energy – through rooftop solar, say – are using the grid infrastructure for storing their extra solar energy without paying for the grid, which is an unsustainable utility model.

Smart grids use technology to communicate between energy suppliers and users to make the system far more efficient, for example, by allowing consumers to choose to reduce energy use at peak times.

“Smart grids are definitely happening,” he says. “It won’t be overnight, but they are incrementally being implemented.”

*For more from Catherine, contributors from the Economist Intelligence Unit along with industry experts, join The Future Realities discussion.

Think you have what it takes to shape the future?

By Alyssa

If you have been following this blog for the past 6 years, or if you’ve just found us – you will know that we at Dassault Systemes are driven by a goal to help people imagine sustainable innovations capable of harmonizing product (the economy), nature (the environment) and life (the people). We believe that “if we ask the right questions, we can change the world.”  We are passionate about helping leaders in a range of industries around the world create innovative ways to advance and optimize our path to the future.

To support our mission, we are excited to announce that we have formed a new community on LinkedIn called Future Realities.  You won’t hear a lot directly from us there. Instead, we created this as a space for anyone interested in kicking around ideas around future trends and technology to come together.  You’ll find posts now from thought leaders from The Economist and the Wall Street Journal, and every day community members are raising their own questions to learn what others out there think.

We would love for you to join us! Share your own questions, or jump into one of the compelling discussion topics already raising interesting points, such as:

Join the Future Realities Discussion

Solar Energy Prepares to Shine

By Catherine

Written by Catherine Bolgar

Solar energy has been the promise of the future for a long time now—the solar cell was invented in 1883. Yet it looks as if the coming decades will be when solar power truly finds its place in the sun.

Solar panels

There’s been a six-fold reduction in the cost of solar panels since 2008. The full implication of that isn’t as widely appreciated as it could be,” says Martin Green, professor at the Australian Centre for Advanced Photovoltaics at the University of New South Wales in Sydney. “Solar panels now are getting to the kind of cost that makes them interesting for more applications.”

Those future applications could see commercial and residential buildings clad in solar panels. Already, the Delta, a self-powered building in New York built by Voltaic Solaire, uses solar panels on two sides of the building, as well as other solar panels that act as awnings above the windows.

Eventually “we will make transparent or semitransparent windows that use some of the light to generate electricity and the rest to light the interior,” Dr. Green says.

Drones may use solar panels to allow them to stay perpetually in flight. Mainstream aviation could someday use solar panels to make hydrogen for fuel. Researchers at the University of Notre Dame in Indiana are working on paint with nanoparticles that will convert sunshine to power and turn any surface into a solar panel.

“If electric vehicles take off the way they’re supposed to, solar power could be a range-extender,” Dr. Green says. A rechargeable electric vehicle could juice up its batteries any time it’s parked in the sunlight.

Meanwhile, there’s an electric-car charging station in Pflugerville, Texas, that uses a giant sail made by Pvillion, a New York maker of flexible solar panels.

Another solar technology could recharge electric cars in a flash. Eicke Weber, director of the Fraunhofer Institute for Solar Energy Systems in Freiburg, Germany, drives a fuel-cell car requiring hydrogen as a fuel. The Fraunhofer Institute has a charging station that converts solar power into hydrogen. A fill-up there takes only five minutes at 700 bar, to deliver three kilograms of hydrogen, which can power the car for 300 kilometers.

Photovoltaic panels keep getting more efficient—commercial panels are able to convert 20% of the sunshine that falls on them, up from 7% to 8% when the industry began. “I think we will [reach] 30% to 40% efficiency in 20 years,” Dr. Green says.

Greater efficiency means cheaper panels because they could be smaller, and glass and packaging account for a large part of the cost. The key material in photovoltaic panels is silicon, which is the second most abundant element on Earth after oxygen, and is nontoxic to boot.

Solar cellsThe silicon used in solar panels is in a crystalized form, which resembles that of diamonds, and are nearly as strong as the gems.

Diamonds are for ever and silicon is almost the same,” Prof. Weber says. “Silicon has a very, very long lifetime.”

Tweet: Tweet: “Diamonds are for ever and silicon is almost the same” – #Solar Energy Prepares to Shine: http://ctt.ec/8nhGM+ via @Dassault3DS #energy

New technologies continue to be developed. There are efforts to use a multilayer structure, which is very efficient but costly. To reduce the cost, the panels are cut into 1,000 small cells, each about two millimeters square. These are placed under a big lens that focuses the light on them, but the cells must move along two axes to track the sun, Prof. Weber says.

Solar power has entered a virtuous circle, where technological advances have led to greater efficiency, which has brought down the cost, which has expanded the market and has generated interest in research and development for new solar technology, Prof. Weber says.

Solar electricity in Frankfurt now costs about €0.10 ($0.14) per kilowatt-hour, he says. In Africa, it can cost as little as six or seven cents per kwh.

By contrast, average residential electricity prices, including taxes, in 2012, were €0.26 per kwh in Germany and €0.19 on average for the 15 original members of the European Union, according to the European Residential Energy Price Report by VaasaETT, a global energy think tank based in Helsinki. Electricity from oil costs about €0.20 per kilowatt-hour.

Most people are not aware that solar electricity has a lower cost of production than for electricity from oil,” Prof. Weber says, adding: “In a decade or two, solar energy will cost just two to three cents per kilowatt-hour.”

For private homes in Australia, “it’s cheaper to install solar panels than to buy electricity from the power company,” Dr. Green says. It’s no wonder that one in eight homes in Australia is installing solar panels.

Tweet: “In a decade or two, solar energy will cost just 2 to 3 cts / kWh” – Solar Energy Prepares to Shine: http://ctt.ec/VbbdI+ via @Dassault3DS

Shopping centers also have discovered the benefits of solar power. Retail buildings consume power during the day—when tariffs tend to be the most expensive—yet that’s ideal for making the most of solar power, he says.

One of the drawbacks of solar power—that it’s available only during the day—could one day change as well. Not just through better battery technology, but by creating a global grid.

We can imagine a world that’s globally connected,” Dr. Green says. “We’ll be able to transmit electricity from wherever the sun is shining to where it’s needed.”

For more from Catherine, contributors from the Economist Intelligence Unit along with industry experts, join The Future Realities discussion.



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