This article, written by JPT Technology Editor Chris Carpenter, contains highlights of paper IPTC 21348, “The Color of Energy: The Competition To Be the Energy of the Future,” by Hon Chung Lau, National University of Singapore, prepared for the 2021 International Petroleum Technology Conference, held virtually 23 March–1 April. The paper has not been peer reviewed. Copyright 2021 International Petroleum Technology Conference. Reproduced by permission.
The author of the complete paper, for the purposes of this study, characterizes energies as brown, blue, or green. Brown energies are carbon dioxide (CO2)-emitting fossil fuels, such as gas, oil, or coal. Blue energies use carbon capture and storage (CCUS) technologies to remove the emitted CO2 from brown energies. Green energies are zero- or low-CO2-emitting renewable energies. By analyzing the CO2 intensity and levelized cost of energy of energy carriers of different colors, the author shows that renewable energies are best used in replacing fossil fuels in the power sector, where they have the greatest effect in reducing CO2 emission.
Overview
By 2017, only 11% of the world’s final consumption came from renewable energies, 85% came from fossil fuel, and 4% came from nuclear energy. Energy consumption can be divided into three sectors: power, transport, and thermal. At the time of writing, 26.4% of global power (electricity) consumption comes from renewable energies. In this sphere, renewable energies are making the most significant contribution in reducing CO2 emission. Forty-one percent of CO2 emission comes from electricity and heat, 21% from transport, and 21% from industry. Consequently, the key to global decarbonization is to decarbonize these three sectors.
Green Energy Is Preferred
Green energies consist of six major types: solar photovoltaic, solar thermal, wind, hydroelectricity, geothermal, and biomass. If 1 kWh of electricity generated by renewable energy (with the exception of biomass) is used to replace 1 kWh of electricity generated by fossil fuel, the net CO2 savings will amount to 0.8, 0.6, and 0.4 kg for replacing coal, oil, and natural gas, respectively.
However, if 1 kWh of renewable electricity is used to generate green hydrogen (H2), which is then used for heat generation in industry, it will yield roughly 0.8 kWh of thermal energy, which replaces the same amount of thermal energy by natural gas. This amounts to a CO2 savings of only 0.16 kg CO2/kWh. Consequently, renewable power has the highest CO2 savings effect if it is used to replace fossil fuel for power generation rather than to replace fossil fuel for heat generation.
Decarbonizing the Power Sector
The power sector is easiest to decarbonize. The three methods foreseen to decarbonize the power sector are nuclear power, blue electricity generated by fossil-fuel power plants equipped with CCUS, and green electricity produced by renewables. The use of nuclear power plants is a country-specific issue. The dual challenge of nuclear plant safety and nuclear waste storage is a key sustainability issue. Recently, interest has been renewed in the idea of increasing investment in nuclear energy for decarbonizing the power sector. It is noteworthy that the countries for whom more than a quarter of their power generation is provided by nuclear energy are all in Europe.
Financial Performance of Renewable and Fossil Power Sources in India
