Your browser is not supported. Please update it.

1 October 2020

The world of renewables this week

The IEA has continued to pander to the oil majors this week, stating that a sharp rise in carbon capture, utilization and storage technologies will be needed if countries are to meet decarbonization targets. The organization has claimed that $160 billion will need to be invested in the technology by 2030, despite very little technical success in recent years. This follows the IEA’s trend of underestimating the progress and penetration of renewable technology and overplaying the role of fossil fuels and moonshot technologies like CCUS. Read next week’s edition of Rethink Energy for more in-depth analysis.

Oil prices have held steady this week and shown signs of increase after US lawmakers delayed voting on the country’s $2.2 trillion stimulus package, which may be rejigged through a bipartisan agreement to bailout oil through a second wave of the Covid-19 pandemic.

Hydrogen fuel cells have been ordered for the €5.85 billion Blue Danube hydrogen project, which aims to decarbonize mass river transport through river tug-boats in central Europe. “Testing is planned for the turn of the year 2021-2022, and we are looking to launch a new design as early as 2023,” according to TECO 2030, which has partnered with AVL and Chemgas Shipping for the project.

Goldman Sachs has put a whopping $12 trillion figure on what it expects the size of the hydrogen market will be by 2050. Green hydrogen from renewables could become the largest electricity consumer and double power demand in Europe, according to the group. This means that the capital expenditure on renewable energy will have to double, the gas grid will need reconfiguring and that a wealth of opportunities will arise in technology. Goldman identified three main ways to get exposure to what it called ‘e-hydrogen:’

  1. Utilities like RWE, EDP, Enel, Iberdrola, NextEra, SSE and Orsted, based on the rise demand for renewable electricity.
  2. Infrastructure companies like Snam and Enagas, which could see new investment as they try to incrementally convert existing pipelines into those that can support hydrogen distribution.
  3. Turbine operators like Uniper, Engie, RWE and The Williams Cos, which will be reconvert gas plants into hydrogen turbines.

 

The Trafigura Group, which handles around $180 billion in revenues from the trading of oil and other commodities, is forming a renewable energy company under the name Nala Renewables, as part of a joint venture with IFM Investors. The pair will hope to develop 2 GW of projects over the next five years, in a shift towards trading renewable electricity. Nala Renewables will look to build and operate renewables projects in markets where Trafigura is already active, often off the back of its existing mining and port infrastructure, notably in Europe, Asia, and some emerging markets.

Tesla is in talks to mine its own lithium, after talks to buy mining company Cypress Development Corp fell through. According to founder Elon Musk, the company has already secured mining rights for over 10,000 acres in Nevada. This comes as part of Tesla’s ambition to cut the cost of EV batteries by 50% and bring the total cost of a vehicle down to $25,000. The method Musk is relying on is obtaining lithium from lithium-rich clay deposits, however, historically this has proved to be both difficult and expensive, due to low recovery rates, and some aspersion is being cast over the company’s ability to produce Lithium from clay in commercial quantities.

Shell has announced that it will cut between 7,000 and 9,000 jobs by 2022, as a result of the slump in oil demand through the Covid-19 pandemic. While the company has not indicated where these job losses will happen, this is likely to fall in line with its shift to focus on renewable energy and become a net zero company by 2050. The company saw a 46% drop in net income through Q1 to $2.9 billion (£2.3billion), before a sharper drop of 82% in Q2 to $638 million. As a result, the company has announced plans to cut annual spending by up to $2.5 billion by 2022. These job cuts could account for as much as 15% of this.

ZeroAvia has completed the first ever test flight of a fuel cell passenger plane, powered solely by hydrogen. The test took place in California, with a 6 passenger Piper Malibu aircraft flying for 8 minutes, at a height of 1,000 feet and a speed of 115 mph. This comes as an early boost to the company’s plan to make hydrogen electric aircraft a commercial reality as early as 2023.

Vietnam’s rapid rise in electricity demand will require $133.3 billion of investment by 2030, according to a government report. With rapid economic development and population growth, the country is currently anticipating an 8.6% year-on-year growth in demand up to 2025, before a 7.2% rise each year between 2026 and 2030. While the country’s total installed power capacity stands at approximately 56GW, the $133.3 billion investment would increase the country’s energy capacity to 138GW. The Ministry of Industry and Trade is currently preparing a new power development plan, which will be sent to the government for approval next month, and is likely to include a mammoth boost in ambition of wind and solar power, as well as natural gas, while the country aims to reduce its dependency on coal-fired power stations.

The UK’s Energy Research Accelerator (ERA) is applying for a further £250 million of Government funding for research surrounding pathways to net zero emissions. The project aims to make the Midlands region of the country a clean energy hub by kickstarting 7,000 new jobs and £1.5 billion in gross value added. So far the ERA involves a community of 1,500 researchers, while an initial funding of £60 million has helped create 23 new research facilities.

Electric vehicle charging network ChargePoint will go public by the end of this year, after merging with Switchback Energy Acquisition Corp in a deal that gives the company a reported value of $2.4 billion. Through the deal, ChargePoint will receive around $493 million proceeds, which it will use to expand its presence in North America and Europe. ChargePoint operates more than 115,000 charging ports worldwide, which it is aiming to boost to 2.5 million by 2025. The company’s revenue was $147 million last year, which it predicts will rise to more than $2 billion in 2026.

Sweden’s Svenska Kraftnat will continue to be at odds from the EU’s requirements for transnational transmission for at least another year, after the TSO claimed that it would not be possible to guarantee that transmission capacity would be able to stay above the legally required 70%.

RWE has announced plans to use massive underground salt caverns as giga-scale flow batteries by filling their vast capacity with low-cost electrolytes. Subsidiary RWE Gas Storage West, which operates five natural-gas storage caverns, has started a feasibility study with energy storage start-up CMBlu Energy, to select suitable electrolytes to be used in a 100kW/1MWh test system, which the pair hopes to test through to 2024.

Renewables have accounted for a 44.6% share in electricity generated across the UK for the second quarter of 2020, up 9% from Q2 2019. This sits just behind the record set through a windy Q1 2020.

Poland’s mining unions have agreed to a coal mining phase out by 2049 in a solid step towards phasing out coal, which is responsible for around 75% of the country’s electricity generation.

According to statistics collected by news site bjx.com, in the first nine months of 2020, 49 Chinese solar manufacturing companies have announced expansion plans with a total investment of $47.4 billion. In total, 314 GW of module capacity, 250.3 GW of cell capacity – including 38.39 of heterojunction and 120 GW at the new 210mm cell size – and 184.6 GW of wafers and silicon rods.

South Australia has introduced new rules under which households must nominate an ‘agent’ with the ability to switch off their solar at the request of the market operator, and must use a state-approved inverter. Similar rules will be implemented in Western Australia and then the rest of the country, to address fears of ‘zero demand’ crashing the grid.

China installed 4.5 GW of solar in July and August combined, which is a rate slightly faster than the first half of the year overall. There was a spike in utility-scale projects in July; many had been delayed from 2019 with an extension of an incentive deadline.

Judging by the latest information from module suppliers, it looks like China may finish the year having installed 38 GW of solar capacity – higher than the low point last year of 30 GW, but not as high as the optimistic 45 GW predictions seen in the past few months. One reason for this may be the interruption of polysilicon supply, as well as the huge increase in its cost. This could by itself explain the drop in anticipated Q4 additions from 20 GW to 15 GW.

Trina Solar is heading towards 10 GW module manufacturing capacity this year, then to 21 GW and 31 GW in the next two years.

South Africa has confirmed it is looking to procure 6.8 GW of renewables, about one-third solar and two-thirds wind, by 2022, and 11.8 GW by 2027.

American utility Vistra will develop 1 GW of solar-plus-storage projects in Texas over the next two years, with $850 million investment, on course for net-zero emissions in 2050.

Chile has introduced new rules for distributed generation, including a framework for ‘energy communities’ under which sub-300 kW systems will be able to supply power to multiple consumers.

Brazil’s solar association, ABSOLAR, has announced that Brazil has reached 3.6 GW in distributed solar, of which 72% is domestic.

Canadian architectural facade company Elemex is now offering building-integrated cadmium-telluride solar panels with between 15.3% and 18.2% efficiency.

Electriq Power will acquire analytics company Lilypad Energy for an undisclosed sum, with the intention of bolstering the company’s expertise around battery system performance and to develop a foundation for real-time grid services for utility-scale infrastructure.

Entergy Corp will collaborate with Mitsubishi Power on bringing decarbonization projects to the utility’s businesses in Arkansas, Louisiana, Mississippi and Texas and a major part of the collaboration will be focused on developing a hydrogen capable gas turbine combined-cycle, green hydrogen production and storage and transportation and using nuclear-supplied electricity to electrolysis facilities to create hydrogen.

Researchers at the US Department of Energy’s National Renewable Energy Laboratory (NREL) says in a report out this week that floating solar panels working alongside hydropower plants may have the potential to produce much of the shortfall in electricity requirements around the world. A year ago Rethink Energy produced its own report which showed this very clearly. NREL estimates that adding floating solar panels to bodies of water that are already home to hydropower stations could produce as much as 7.6 terawatts of power a year.

Russian state energy holding InterRAO plans to invest around $580 million in a gas turbine joint venture with General Electric, so that Russia can modernize much of its thermal electrical power. The two will make gas turbines by 2025/2026, 90% of them produced domestically and InterRAO hopes to sell 25 of these by 2030.