Sustainable Fossil Fuels: The Unusual Suspect in the Quest for Clean and Enduring Energy

Jan/2006 Jaccard / Res&EnvMgmt / SFU 1

Sustainable Fossil Fuels:

The Unusual Suspect in the Quest for Clean and Enduring Energy

Mark Jaccard

School of Resource and Environmental Management

Simon Fraser UniversityVancouver, Canada

January, 2006

emrgemrgenergy and materials research group





Prescription – assume humanity should strive for:– A near-zero-emissions (indoor, urban, regional, global)

energy system with low impacts and risks to land and water

– Expansion of system to meet legitimate energy service needs of the global population

Prediction – given this sustainability prescription:– How will major energy options fare this century and

beyond?

– What might such a system cost?

– How could we achieve it?

Prescription and prediction of a

sustainable energy system


Motive: a researcher’s reaction to strong

assumptions



Troubled by many recent books attributing major global problems to fossil fuels – war, economic chaos, environmental harm.

“Civilization as we know it will come to an end sometime in this century unless we can find a way to live without fossil fuels.”

(Goodstein, End of the Age of Oil, Norton, 2004).


What is the energy system?emrgemrg

energy and materials research group


Nuclear

Fossil fuels

Lighting

Transport of goods

Electrolysis

Industrial- thermal

Space heating and conditioning

Primary energy Energy servicesSecondary energy

Renewables

Personal mobility

Energy efficiency

Hydrogen

Electricity

Electric appliances and equipment

Industrial- mechanical

Industrial- motive-force

HydrocarbonsNuclear

Fossil fuels

Lighting

Transport of goods

Electrolysis

Industrial- thermal

Space heating and conditioning

Primary energy Energy servicesSecondary energy

Renewables

Personal mobility

Energy efficiency

Hydrogen

Electricity

Electric appliances and equipment

Industrial- mechanical

Industrial- motive-force

Hydrocarbons


Current trendsemrgemrgenergy and materials research group


Fossil Fuels

358 EJ

Ren. Modern

16 EJ

Ren. Trad. 45 EJ

Nuclear 9 EJ

Fossil Fuels 920 EJ

Nuclear90 EJ

Ren. Trad. 90 EJ

Ren. Modern 290 EJ

Total =: 429 EJ 6 GtC/year

Total =: 1,390 EJ >20

GtC/year

2000 2100

Population – 6 billionE/GDP - 13.5MJ/$

Population – 10.5 billionE/GDP – 6 MJ/$




Hydrogen30%

Hydrogen or Hydrocarbons

10%

Hydrocarbons30%

Electricity30%

Sustainable secondary energy in 2100?


Challenges for nuclear and renewables

Nuclear power (risk perception)– Aversion to extreme event risk (focus on outcomes)

– Geopolitical risk

Renewables (uncertain costs with scale-up)– Cost declines with R&D and cumulative production

– Cost increases from scale-up related to low energy density, variable output and inconvenient location






Energy efficiency trend

0

5

10

15

20

25

1850 1875 1900 1925 1950 1975 2000

Year

E/

GD

P (

MJ

/$

19

90

)


Challenges to accelerating the efficiency trend

Ignored costs of more efficient devices– risks of long-payback and new technologies

– intangible costs of imperfect substitutes

Mega-rebound from energy productivity– direct end-use rebound

– innovation and commercialization rebound

Policy barriers– ineffectiveness of information and subsidies

– political challenge of higher prices and regulation




Fossil fuels:“the unusual suspect”

How long can they last?– reserves and resources of coal, oil and natural

gas

– substitution between fuels and with other energy

Can we use them cleanly?– history of cleaning up

– new and old challenges – urban, regional, global




Hubbert’s peak emrgemrgenergy and materials research group



What consequence? emrgemrgenergy and materials research group



Oil sources and substitutionemrgemrg






Quantity of gasoline (liters)

$ / liter Conventional oil

Unconventional oil

Coal Biomass

Cost of gasoline

?

?

Quantity of gasoline (liters)

$ / liter Conventional oil

Unconventional oil

Coal Biomass

Cost of gasoline

?

?

Secondary energy prices and primary energy

substitution




Zero-emission fossil fuel use

natural gascoal, oil

combustion, reforming, gasification

CO2,etc.

electricity

hydrogen


Geological storage of CO2 and other

emissions



Release methane from deep coal

Deep Saline Aquifer

Depleted Oil Reserves

Pipelines

Release methane from deep coal

Deep Saline Aquifer

Depleted Oil Reserves

Pipelines


Carbon sources and sinksemrgemrg



0 G tC

1 ,0 00 G tC

2 ,0 00 G tC

3 ,0 00 G tC

4 ,0 00 G tC

5 ,0 00 G tC

6 ,0 00 G tC

C o a l

G a s

O il

Living

PH < 0.3De a d

Fo ssil Fue ls

(reso urc e b a se )

C o nsum p tion

A tmo sp

he re

Te rrestri

a l

b io sp he reAq u ife

rs

O c e a ns

O il & g a s

re se rvo irs

C o a l be d s

Source: David Keith


Zero-emission fossil fuels energy system




Criteria for predicting social preferences

Projected cost (synthesis of numerous studies)– Depletion of higher quality resources and sites– Cost reduction through innovation– Cost reduction through greater production

(economies-of-scale and economies-of-learning)

Extreme event risk– Aversion to extreme event risk (focus on outcomes)

Geopolitical risk– Energy supply security and political independence

Path dependence– Not a decision criterion, but a long-term cost factor




Projected electricity cost



Zero-emission generation of electricity

(¢/kWh in $US 2000)

Assumed input prices are coal $1.5 – 3/GJ, natural gas $5 – 7/GJ, and biomass $2 – 5/GJ.

2

4

6

8

10

12

(¢/kWh)

coalcombustion

coalgasification

naturalgas

nuclear

hydro

wind + storage

biomass

PV-solar


Projected hydrogen cost



Zero-emission production of hydrogen($/GJ in $US 2000)

Assumed input prices are coal $1.5 – 3/GJ, natural gas $5 – 7/GJ, and biomass $2 – 5/GJ. See electricity prices figure for electrolysis.

5

10

15

20

25

($/GJ)

coalgasification

naturalgas

biomassgasification

Nuclear electrolysis of

water

Wind/hydro electrolysis of

water




The challenge for nuclear

The limits for efficiency

Renewables versus zero-emission fossil fuels

Incorporating all criteria


Primary energy shares in a near-zero-emission

future



Fossil Fuels

358 EJ

Ren. Modern

16 EJ

Ren. Trad. 45 EJ

Nuclear 9 EJ

Ren. Modern

450

Fossil Fuels 680

Nuclear 40

Ren. Trad. 30

GHG Emissions = 6Gt/C

Total = 1,200 EJ

GHG Emissions = 1~2 GtC

2000 2100

Fossil Fuels

358 EJ

Ren. Modern

16 EJ

Ren. Trad. 45 EJ

Nuclear 9 EJ

Ren. Modern

450

Fossil Fuels 680

Nuclear 40

Ren. Trad. 30

Total = 429 EJ Total = 1,200 EJGHG Emissions = 1~2GtC

2000 2100




Energy price increases

– Electricity final price increase of 25-50% over the next 50 years (less than 1% per year)

– Similar increases for clean burning gaseous (H2 or H2 mixed with natural gas) and liquid (biomass) fuels

Rising energy cost share of household budgets

– Increasing in typical OECD country from today’s 6% to 8% by about 2050

– Compare to 20% energy cost share of household budget in 1900 and 20% in developing countries today

Impacts for energy consumers


Careful not to bias energy regulation against clean fossil fuels– Subsidies and regulations that only

favour efficiency, renewables and nuclear

Newer approaches– Multi-sector or economy-wide cap and

trade (with safety valve)– Sector-specific regulated niche markets



Impacts for energy regulation


Conclusion

Energy system should be seen in terms of means and ends – not good guys and bad guys.

The end is a clean, enduring and low cost energy system – with minimal extreme event and geopolitical risk.

In the pursuit of this end, fossil fuels can be part of a sustainable energy system for a very long time.




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Sustainable Fossil Fuels: The Unusual Suspect in the Quest for Clean and Enduring Energy

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