Seizing the Massive Opportunities of Cheaper Renewables and Storage

good morning everybody well good day if you're watching this in the recording this webinar is being recorded so welcome to the seminar seizing the massive opportunities of cheaper renewables and storage from the center for energy transition at the university of aberdeen this is the first in a series of four webinars that are being organized in the run-up to and indeed during and after the cop 26 conferences starting next week in glasgow my name is russell mckenna i hold the chair for energy transition at the school of engineering in aberdeen and today i'm going to be joined by a panel of experts to discuss this topic of renewables and the the cost situation uh so as well as myself i'll be joined by paul dobbs who is a professor of energy systems at ucl energy institute and the institute for sustainable resources in london uh also by dr magnus harold innovation manager at offshore renewable energy catapult henry jeffrey is the head of policy and in the innovation group at the university of edinburgh and additionally two colleagues from the university of aberdeen will be joining the panel uh brett scott is a professor in marine ecology in biological sciences and dr ashley hastings is a reader also in biological sciences so the agenda for today is that we have four impulse presentations for members of the panel of approximately 10 minutes which will be followed by a discussion amongst the panel just before we get started in terms of housekeeping so you won't be able to use your video or your microphone in the audience but please do share questions in the chat function and we will prioritize those based on the votes that they get and try to address those in the discussion so without further ado i am going to present to you a second okay so i'm going to present to you about cost trends and renewable energy technologies talking about progress from subsidies to grid parity and hopefully by the end of this presentation if you don't know already you know that is and beyond so just to set a bit of context for this seminar i wanted to um i wanted to give you you a bit of background because we're talking about energy transition but this is by no means the first energy transition that we as society has undergone if you look at this long-term trend in primary energy consumption across the world you can see that indeed we've had previous energy transitions wood in particular biomass has been used for centuries and still is in large parts of the world for decentralized heating and cooking then we have the transition towards fossil fuels during the late 19th and 20th centuries as you can see here nuclear energy only really started to play a role during the 20th century and then we have what we call modern renewables uh hydro power came about in the 20th century but really what we're talking about today is the set of modern renewables uh in particular wind on an offshore wind solar pv and bio energy focused power and each generation so that's the broader context for what we're talking about and if we zoom in for to the uk we can see that in the recent in the last decade or so the renewable electricity generation in the uk has um increased by a factor of around five so back in 2009 we had about 25 terawatt hours of electricity from renewables and today that is up around 110 terawatt hours the main reason for that is the heavy or the intensive uh subsidy schemes for these renewables which have encouraged encouraged investment uh in these technologies i don't want to go through all the details of the different technologies i mainly want to know the main technologies are those are namely on offshore wind as you can see here solar photovoltaics and various types of bioenergy biomass for example um when it comes to renewable technologies one of the key metrics that we tend to use uh as researchers and scientists policy makers are the so-called lcoe's levelized costs of energy these are a common benchmark across different energy technologies and what they do is as shown in the equation here they relate the total costs of energy output over the lifetime to the actual energy output and they do this by adopting a discount in what we call a discounted cash flow approach so they do a net present value calculation over the lifetime of these plants and calculate the cost per unit of energy output typically in kilowatt hours or megawatt hours over the whole lifetime perhaps 20 30 years the main drivers for these levelized costs are the investment in the plant so the upfront cost the capex how much does it cost for one megawatt of generating capac capacity also the operational cost that includes things like operation and maintenance for the plants but also variable costs or fuel costs if these plants have these and obviously a lot of renewable technologies do not have variable or fuel costs in particular solar and pv energy is the exception here because obviously bio energy or biomass does have a cost and the fuel does have to be paid for and another key driver of the lcoes is the energy production the capacity factor so basically how good the wind resource or the solar resource is how full to capacity the plant is loaded and this mainly depends on location so where in the world or where in the country the plant is located one thing we're really interested in today in this seminar is the massive reductions in cost or specific cost in terms of dollar per megawatt or dollar per megawatt hour that we've seen in recent years for most of these modern renewable technologies so this is shown based on some data from irena the international renewable energy agency here whereby we see massive reductions in costs for both offshore and onshore wind and the largest reduction has been for solar voltaics we talk about learning rates for technologies as shown here learning rate means the rate of which this cost reduces why does it reduce well it mainly reduces through technological progress improvements in manufacturing in efficiency of technologies in integrated supply chains and and what we call spillover effects so producers and countries learning from each other renewables have had massive reductions in costs the the conventional technologies have not this chart actually shows nuclear energy has actually become more expensive in this timeframe we see similar reductions if we look to storage in particular lithium ion batteries uh we can see a similar trend if we look a few decades ago back to the early 90s but the cost per kilowatt hour of a lithium lithium-ion battery potting on a logarithmic axis has reduced significantly yeah significantly over this time frame and so what has happened in in many countries um is that we've achieved what is known as grid parity um and this is illustrated here for photovoltaics um so pv solar pv and grid parity is essentially the point in time where the levelized cost of your pv plant equals the consumer's electricity price so the the price of electricity that you get from the grid uh is is at or above the generation costs of your electricity from your pv plant and obviously this incentivizes that you use this electricity yourself um in some contexts we're also approaching the level i sorry the grid parity for battery systems uh obviously the the temporal availability of solar energy means that you're not necessarily at home in the middle of the day when your solar panel is producing the most electricity which means in combination with battery systems uh you could possibly shift that to the evening or to the morning hours and so l series of um or ltos levelized cost of storage of battery systems is uh on the verge of becoming uh or reaching parity with with grid costs so this provides additional incentive for exploiting in this case pv but also any other modern renewables if we take a bird's eye view across the lcoe so this is some data for 2020 showing a typical ltoe ranges in dollars for renewable energies shown in the top of the figure and conventional technologies to the bottom this is in dollars per megawatt hour i don't want to really go into all the details here for the sake of time but i just want to illustrate with the aid of this data that with the exception of rooftop pv most of these renewable modern renewable technologies are in the same range as most of the conventional technologies and they include obviously fossil fuel based power plants but also nuclear power plants so what is going to happen in the future with the lcoes well obviously seeing various drivers for them as i mentioned previously the european emissions trading scheme is seeing high prices of carbon the highest ever in euros per ton more like 50 or even higher and this is obviously a markup on especially on coal plants and another driver for conventional plants is obviously the fuel prices we're also seeing the highest gas prices that we've seen in many years certainly in the uk so these drivers tend to push up the costs the lcoe of conventional generation or on the other hand we're seeing these learning effects of uh renewable technologies so we expect to see it sometime in the future it's a big question that's why it's a question mark here when exactly that will be but we expect we're seeing a convergence and we expect them to reach parity renewables with conventional generation it's uncertain due to fossil fuel prices how they will develop how technologies will develop but at some point in the future we expect a reaches parity however this lcoe perspective is an oversimplified one and i just want to emphasize that it's not the best or the only way to compare technologies the problem is that if you look at an end user's electricity bill in the uk you can see all these different fractions and essentially the ltoe only counts for this wholesale cost so this is the cost of electricity on the wholesale market which as you can see here accounts for just over a quarter of the cost then you have things like network costs the cost to maintain and extend the electricity networks operating costs for the utilities for the actual companies that have to distribute and administer the billing processes and then you've got other environmental and social costs for example the indirect costs that you and i as consumers pay for the renewables and a few other parts there that i won't go into but the point here is the ltoe really only measures the wholesale cost so it doesn't include all these other parts and that's why it's an unfair comparison to compare renewables with the end user price another reason is that you need to integrate renewable energies into your energy system for which we have four different measures we can expand or extend uh the networks or we need to we need to have flexible generations with existing power plants we need to extend the installation of smart meters and intensify this concept of smart grid so we have remote load management across the system and a virtual power plant speak to each other or communicate and we need a lot more energy storage this has additional costs and these are known in the literature and the discussion as integration costs so essentially on top of the lcoes we have an additional chunk of of cost which accounts for three main aspects it accounts for profile the fact that for example as i mentioned solar power has a profile throughout the day it accounts for uh the grid extension and it accounts for balancing the fact that sometimes the forecast for renewable energy generation is slightly wrong and we need the power system to be flexible in order to balance this difference out and with that i am at the end of my presentations by all means get in touch i want to hand over at this stage to paul dodds who's the next potentia and i look forward to your questions in the discussion part okay thank you very much russell let me just share my screen with everybody so it's great uh thank you very much for inviting me uh to talk here um i'd like to build on russell's talk by talking about energy storage for renewable integration and i'm but particularly grateful to james price for some of the work that he's done but also to a number of other people who contributed to the work that's shown here but i i take all the blame for the actual content of the presentation which they haven't seen and as russell says one of the issues with renewables is that they're variable the output is variable and so lcoe as a metric tends to break down when you as you increase the proportion of renewables in your system because the integration costs potentially become higher and higher and in the future that's likely to be amplified as well because electricity demands are going to become more variable so here's an example of what would happen if we electrified a lot of transport and heating on a peak week and this the peak week we've chosen here is the peak week in december 2010 which was a particularly cold period and we can see fairly large uh changes in electricity demand between about 80 gigawatts and almost 140 gigawatts over that week and some some very large changes during the days as well so it often varies by 30 gigawatts in a very short space of time and so we're going to have a system where where supply becomes more variable and demand also becomes much more variable with demand becoming more variable we'll have periods when we have substantially higher generation than we have demand because we have a lot of reviewables on the system that are generating when we're not using electricity and so that electricity will be lost unless we have some method of utilizing it and that's where energy storage comes in now we tend to think of energy storage on on scales um and we when we think of an electricity system most people think of a transmission scale type system where we have some conventional generations from renewable generation that produces some electricity um we put that into the grid we store it as required um we also have some international connections and then when we need it the electricity goes to the distribution system but of course we can put as russell mentioned the storage at the distribution system as well so in for example in the combined pv and energy storage systems that some people are selling these days but once we do start to get to the distribution scale in the future presumably if we have a greater stock of evs then we might be able to use battery vehicle storage as well so vehicle to grid storage so you can see different stats sorts of storage starting to appear here we also have integrated storage with renewables has appeared in the top left hand corner um where you have where you store the the energy almost as a precursor to the electricity generation as opposed to generating the electricity and then storing it and historically actually that's how our system has worked so we've always had lots of storage within the electricity system people when people think of storage they think of pumped hydro which is a very short-term thing high power but uh but actually uh most of our storage and electricity has been piles of coal or reservoirs of gas so we've stored precursors to electricity instead of electricity because uh storing electricity is expensive in comparison and if if i expand that expand this diagram a little bit further i went again to look at the whole energy system we then see other types of storage coming in so we have gas storage and that could be natural gas or particularly hydrogen we have heat storage and we have this uh and that can be within homes or it could be at a district heat level so we have these other types of storage which are potentially longer term longer term types and have quite different characteristics to your power to power type electricity storage technology that most people think of and and we don't expect to see one particular type of storage dominate or even storage in one particular area in the system to dominate we expect there to be a range of different technologies if we want to try to minimize the overall cost of balancing our system the challenge is that what all the renewable costs have been coming down bulk electricity storage is still expensive particularly over long periods now i've put down a number of figures here and i've done them in pounds per kilowatt in pounds per kilowatt hour so in power and energy terms and that's quite important because the different the different technologies have quite different characteristics in terms of their costs so lithium ion for example the difference between the pound the power or the cost per unit of power and the cost per unit of energy is not too great it's a factor of five for hydrogen it's extremely cheap to store very large amounts but it's much more expensive to do it in kilowatt terms we also need to worry about the round trip efficiency in storage so lithium ion is very efficient and so ninety percent of the energy you put into the battery you can expect to get back out again in comparison hydrogen is is very inefficient so if we produce hydrogen from electrolysis from renewables and we then use that hydrogen to generate electricity at a later date your amount your round trip efficiency might be as low as 35 percent so that's pretty low um and that means that you're not going to be doing that on a day-to-day basis because your losses are too high but it but since the cost of energy storage of hydrogen is so so low it might despite the low efficiency it might still be economically viable on very long time scales so seasonal rather than day-to-day time scales and that's a really important point because different storage technologies work better at different uh on different time scales and can provide different services to the electricity system and therefore although most of the muslim focus has been on batteries to date it's likely i think in the future that there'll be a much broader range of technologies that are actually used in order to provide storage services to the electricity network i'll do some data here but of course those numbers are changing quite a lot in the same way that the capex that the capital costs for renewable technologies have been changing over the last 10 years and and in fact this graph is already out of date we see lithium ion at 600 pounds per kilowatt hour here and it's already much lower than that it's much closer to 100 than 600 now even though we got 100 down for 20 30 here and we can see all of the technology costs are changing over time particularly on particularly in energy terms but also in for some of them in power terms and that makes it quite hard to understand exactly what the best storage technology or cocktail of technologies might be in the future now i tend to argue that storage is one of the hardest technologies to to understand in terms of the future prospects and the reason is that there's so many different characteristics for storage compared to other technologies so so here i've listed a a non-comprehensive list of metrics that have been used within the literature to describe storage technologies so we have storage duration size the charge and discharge duration the number of cycles the response time the round trip efficiency the discharge efficiency the daily self-discharge the energy and power density the specific energy and power the maturity of the technology energy and power capital costs which i i looked at previously on the previous two slides and operating on maintenance costs but there are other ones too so so it's quite hard to try to work out it's really it's a real challenge academically to try and work out the best role of storage within a system i mentioned a lot of focus has been on large grid scale battery investments and that's because quite a few have been deployed or are now planned and as you can see here these are particularly taking place in australia south australia is in particular because that has a very very high level of renewables and quite limited connection connectivity to the rest of the australian networks and also in california uh where where regulations require renewable generators to deploy storage and these batteries are getting quite large so we see in power terms it was a big thing when we had the first 100 megawatt battery uh in australia but people are looking at 1500 megawatts we're getting into gigawatt scale almost um in the near future so this is quite a change but batteries tend to provide very short-term storage so so you can make a case for them um in order to make a case for them because the the costs are still relatively high compared to other technologies you need they need to be providing a service where they're charging and discharging very regularly and they do that very well of course because they have a very high round trip efficiency so they work very well on a day-to-day basis they're very good for providing ancillary services to the electricity system but what they don't particularly do is the long-term type of storage um on when you start to think about weeks months and seasons and a lot of people are now starting to look at hydrogen for that despite the low range of efficiency and one of the reasons is that we know it can work because we know hydrogen storage can work because we've done it in the past so in salt caverns um for example at t side there's now several salt carbons that have been decommissioned and you you essentially take a bit take it take a big hole in the ground pump hydrogen into it and then take it out as you need it okay so the technology works the question is what what sort of levels of storage and what sort of types of storage do we need in order to integrate renewables into the system so this is a study using the hi-res model which is currently at a journal under review so please don't share these two widely yet until it's been reviewed what it shows is the cost optimal share of uk generation from renewables so so this is what what proportion of total electricity generation in the uk is taken by renewables in a number of scenarios okay so each one each one of these um columns is a particular scenario and this you'll see there's three markers in in each column that's that's because this this graph covers 10 weather years so we know the wet weather varies from year to year and that affects both supply and demand and so what we've done is taken a pseudo 2050 system and the dash shows the worst year for renewables the red dot shows the best year for renewables and the green cross shows the midpoint yeah for renewables so an average year and if we have some basic technologies then there's quite a big variation between these so the the optimal level of renewables for example um without without a large inter increase in interconnection with europe varies between about 72 and 88 according to the weather year however if we do have interconnection and if we start including more advanced technologies which for the the middle four is uh biomass with carbon capture and storage and that's important because it provides a thermal generation as essentially zero carbon or negative carbon actually their thermal generation on demand that then that that increases the scope of the amount of renewables that you could include in the system and on the right hand side if we if we add long-term storage as an option instead of just having short-term storage then you can see that the level of renewables actually increases up to about 95 percent so you can um on a cost optimal basis and that's because you have short-term storage of batteries you have the long-stem storage of hydrogen and you have some clever technologies like synchronous technologies to produce what am i thinking of i think they're synchronous condensers so so they they they produce a spinning reserve essentially using a small amount of electricity which is something that's been highlighted as a potential issue with large amounts of renewables and a reason for needing to continue having spinning technologies on the grid but in reality it might actually be cheaper to have bespoke technologies that just produce this provide the service than to actually have lots of gas plants for example are still on the grid and if we look at the cost of these these systems you can see that as we add these technology options despite going to higher levels of renewables we actually reduce the overall lcoe and this this is the lcoe including the cost the cost of integrating these technologies so this is over all technologies including storage um and in some years we reduced them quite substantially but also as we as we add long-term storage as well short-term storage uh we also see that the range of lcoe according to weather becomes rather narrower over time so so we so we can trust so we're less likely to have price variations in such a system so i hope i hope that i've managed to convey to you that storage is complicated but that long-term storage and short-term storage and a mix of different storage technologies but what we will probably want to use in the future in order to provide the lowest cost electricity which also at the same time increase increases the amount of renewables that we can put in the system so thank you very much for listening that's great great thank you paul um let's hunt straight over to magnus harold ore catapulted thanks thanks russell can you just confirm you can see my screen perfect yeah um thanks for introduction i'm magnus harold i work for the offshore renewable energy catapult we are the uk's leading technology and innovation center for offshore renewables and i'm very quickly going to talk about how um cost reduction has been achieved in the offshore renewable sector particularly the offshore wind sector now it's something i could talk about all day but i tried to summarize in less than 10 minutes um so it's just worth while first of all highlighting the fact that the offshore wind sector today is really something that's been hailed as a uk success story and for for many good reasons and we have 10 and a half gigawatts currently of offshore wind capacity installed installed in the uk that's more than anywhere else in the world and is enough to power 8 million homes so we've already made great progress and i'm pleased to say that you know the future also looks very bright for this sector now the government has committed to setting a target of 40 gigawatts to be installed by 2030 which would mean that uh you know capacity would drop quadruple in just 10 years time and and you know some predictions suggest that if we really want to hit net zero by 2050 as much as 75 gigawatts of offshore wind will be required so we've made great progress and we've heard a lot about after a wind already and you're only going to hear more about it in in the future in addition to that you know the industry is created lots of jobs in the uk uh it's brought fresh life into too many coastal communities uh these are areas often which have gone through periods of industrial decline whether that was from you know previously having a shipping industry ship building industry or a fishing industry or even an oil and gas industry and so offshore wind is is bringing new opportunities to some coastal towns and communities as really helping the the uk level up and but uh it you know it wasn't very long ago that uh you know a lot of people were saying well why are we building offshore wind turbines in the first place that sounds like quite an ambitious thing to do and how can that ever be cost competitive and you know only only a few years ago it was very much viewed as being an expensive form of energy generation but the costs have absolutely plummeted in the space of just a few years as shown by the the graph on the right hand side um projects currently being built today are set to be cheaper than existing gas plants which probably the cheapest form of fossil fuel generation um and of course that means it's significantly cheaper than new nuclear ii we've had a long-term government commitment to the sector both in terms of financial support as well as policy support and that's really enabled the the sector to commercialize with confidence to achieve these cost reductions even with that support you still ultimately need to do something um and you need to find technological solutions and probably the biggest of which is the fact that um offshore wind turbines have been getting bigger and bigger as the years have gone on and are actually only set to get bigger in the future too um turbines in development today can be uh are predicted to be capable of producing as much as 15 megawatts from a single device that would be enough to power 20 000 homes and when you compare that to to an onshore wind turbine that probably most of us are a bit more familiar with uh you know the largest onshore wind turbine typically would produce less than four megawatts so so offshore wind turbines are sort of three to four times larger than what we see onshore in terms of their power production and because the larger they have access to higher altitudes where wind speeds tend to be more consistent and by putting them offshore in the first place generally wind speeds are higher too and a small difference small improvement in wind speed makes a huge difference to the amount of power that the device produces and because we've moved to bigger turbines we can essentially install less after a wind farm for the same power output than previously would have been achieved and if you've stole less turbines it means you've got fewer installations to make in the first place which is a very costly part of any project and then it also reduces the number of turbines that you then have to go in and inspect now once the the target once the project is operational so that's probably been the biggest driver and my organization's very much involved in the role of innovation in the sector and i'm pleased to say that innovation has played a massive role also in reducing costs in the sector and it's something that you know innovation has happened in all aspects of an offshore wind farm even before the wind farm is built you know there have been innovations in the kind of survey methods and the project development methods and i've highlighted just a handful of innovations here but there are many um some some things including making the turbines themselves more efficient and more reliable whether that's state-of-the-art center technologies that report back on the health of the turbine or whether that's you know some of the largest machines now don't even require a gearbox so you've removed one system from your device and one potential failure route and things in like the the installation vessels that are used in these projects they can now operate in a much greater range of weather conditions meaning that you can get projects up and running and installed much quicker than previously there are better weather forecasting methods for planning marine option operations so planning when your crew instigate an offshore wind wind farm and that can be done much more cost effectively um and i've included a couple of images of some of the technologies that we've put in particular been involved in uh we're increasingly moving to remote and antonio's methods of doing things like performing site surveys or even inspecting a wind turbine for faults or defects and even things like virtual reality is being used today to train offshore wind technicians to get them familiar with what they're going to see offshore before they actually do it so once they do go offshore they can perform the task much quicker just lastly in terms of the future outlook and so the fixed bottom offshore wind sector as i said has been very successful there are a number of other low carbon technologies that can benefit from the lessons learned in the offshore wind industry and follow a similar trajectory i think in the first instance we're going to see a lot more floating offshore wind these are wind turbines that are placed on floating substructures and are placed in even deeper waters that are currently inaccessible by by current uh offshore wind technology the wave and tidal sector as well i think henry's going to talk a bit more about this but uh this sector can certainly learn uh from from off-road to amazon a good good trajectory um and already mentioned in the sort of storage side uh there's increasing efforts being made in the production of green hydrogen technology and making that cost effective just lastly while the focus has been on on making the sector more cost effective there is also now increasing focus being placed on making the sector more circular as well that might come as a surprise to you the industry itself is is a very very clean industry to work in but there are always ways in which you can improve notable examples include making wind turbine blades recyclable as well as using low carbon vessels so whether they're hydrogen powered or have some kind of hybrid electric propulsion system okay that was a very quick overview and i'm happy to take any questions in the chat thank you very much thanks magnus that's great now over to henry for the final presentation um thanks very much russell limp can you just confirm that you can see my slides perfect okay um good morning everybody my name is henry jeffrey and i lead the policy and innovation group at the university of edinburgh and i'm also a co-director of the uari supergen program that's work i'm going to present today um the work that i'm going to present today is on the potential economic value of the waving tidal sector so building on the the work that magnus has just presented and showing what the returns could be if we have a successful deployment of these technologies in the uk and it builds on work that my colleague charlotte cochrane and seanan panic have done for the super jet program what i'd like to do is um cover two main areas and then finish off on touching on the on the supply chain so to begin with i will look at the deployment and modelling scenarios looking at saying if these technologies are successful in their innovations in the same way that magnus described for for offshore wind or the deployment levels that we see in the uk and internationally and then looking at what the associated economic benefits could be in terms of gva or gdp and jobs associated with the sector and then finally touching on do we have a fit for purpose supply chain in the uk in order to make sure that we can reap those those benefits so to begin with then um as russell mentioned in his presentation about the levelized cost of energy for an emerging technology where you're unsure about its performance and its reliability in its lifetime it's really difficult to set what the levelized cost of energy will be now and what it will be in the in the future although we can do our analysis and forecasting there is a lot of uncertainty there and so in order for us to do reliable forecasting we had to choose what the most reliable um estimate would be of the levelized cost of energy would be for wave and tidal and so what we chose to do was take work from the european commission's set plan so the strategic energy technology planned for for europe has a section where they focus on on wave and tidal and they've set targets for 2030 of a hundred and 150 euros a megawatt-hour for tidal stream and wave technologies respectively and so that's what we've chosen to be our inputs into what market share that we could have if we were to reach these these cost points for these two technologies what we've then done is partnered with two modeling organizations the energy systems catapult in the uk using their resume model in order to look at if we were to meet net zero and we were to have wave and tidal power at the cost points of of the set plan how much domestic deployment would be half of those technologies in the uk and then we've also partnered with international energy agency with the times regional modelling team in paris to say if we take those same cost points from the set plan of 150 euros a megawatt hour how much deployment will there be an international level of the wave entitled wave entitled technology and so with those um models run you can see that if i give show you the output here on the right hand side of the screen of the domestic deployment so here you can see the the energy mix that comes from from that from that analysis from the conventional renewables or sorry conventional generation technology all the way through to renewables and under that scenario of meeting the set plan targets there's over 200 gigawatts of renewables in the uk by 2050 six of which are from wave energy and six of which are from from tidal streams so a reasonable significant part of the of the energy mix so i would say you know small but still significant and if we then look internationally then we can see that offshore renewable energy technology which we're passing is floating offshore wind there are um just under 300 gigawatts globally 115 of which are from wave energy and nearly 80 of which are from are from tidal stream and so this is the first time that there's been a light for light comparison at uk and an international level of looking at if we meet a certain cost point what would be the domestic and international deployments in order to look at the economic benefit so the methodology that we've chosen i've shown you the first step of looking at the deployment and modeling we then go in as russell said that levelized cost of energy is made up of a capex and an opex how much does it cost to build the device and then how much does it cost to operate and maintain those devices and we've then done a gv analysis now gva is gross value added um or similar to gdp and is the the favored metric of choice of treasuries around the world in order to make their decisions on where to place their investments um and then what we've done is looked at where that gdp exists in terms of jobs in the different components of um of deploying these technologies so here we can see that we have um under the domestic scenario we can see that if we make meet these cost um targets then we can have between five and nine billion of gva to the uk economy just from domestic just from domestic sales so a significant industry against any metric there but the difference that you see between the low and the high ambition there is depending on the success of our domestic supply chain in capturing the manufacture and operation of these devices if we then move then to look at uh for international deployments you can see that there is between just over well 11 billion of gba for the uk economy under a low ambition and up to 30 billion under high ambitions in that scenario when you take into account that we wouldn't only be deploying these domestically we'd be hopefully having an ex in export market both of the um selling devices and for operating and maintaining the devices and again you can see you know a threefold difference depending on the fit for purpose of our domestic supply chain on being able to supply that manufacturing and operation and maintenance skills into the into this new sector um but looking at that gvn supply chain where is the actual where is the actual value and what we've done is broken that down into the the main areas of operating and maintaining uh a device and as you can see all the areas are by far from equal and i won't go into into detail here but i think you can see if you look at the top area of the graph in the in the light green that's the operation of the the device and operation and maintenance of the of the device and you can see that that is the largest category followed by the medium blue color in the bottom of the the screen which is um the actual manufacture and supply of the generating device itself so although there are a number of areas that add significant value but by far and away the two biggest ticket items are the manufacture of the device itself and the operations and maintenance of the of the device so making sure that we have a fit for purpose supply chain will be incredibly essential in sort of making sure that this is successful industry not for just delivering net zero but also providing part of a green recovery giving economic returns to the to the uk economy that's really all i was going to say there um the work on the supply chain and how fit for purpose we are is is ongoing uh we're partnering with um for in the first instance for the scottish perspective scottish enterprise and highlands and islands enterprise we're doing analysis of both our device development and manufacturing capabilities in scotland this work will be presented to the scottish ministers working group later this year will be presented to um cabinet secretary mike michael matheson um and we'll be looking at saying okay what are the infrastructure investments that we need to make in our supply chain skills and training and another infrastructure so i will finish finish up there i i know we're running short or short on time but to leave you there are is over if we get this right there could be over 30 billion can be generated to the uk economy from from wave and tidal stream it does require innovation meeting those set plan targets of 150 euros won't happen on its own it will require innovation for that to happen as we've seen has happened from magnus's presentation in the offshore wind sector having the supply chain fit for purpose will be incredibly important to make sure that we can read all of the benefits that we can from this sector and the supply chain work is ongoing it will be presented to the cabinet secretary later this year okay thanks very much for your attention thank you henry for the presentation uh at this point i'd like to ask all the panelists please to join me in this virtual space and we'll kick off the discussion maybe i could start with a brief question to you henry mainly and magnus i mean you highlighted some the expected contribution of different segments of the supply chain in your presentation that's a sort of value added i just wondered if if either or both of you have uh some some ideas or suggestions about specific areas in the uk where we might see this value creation focused particularly with a view towards northeast scotland and aberdeen and for example but also other areas would you like to comment i'll maybe start off and um and magnus can um you can join in um but when you ask that question about sort of specific areas i think there are you know a number of areas of scotland where their house has been historical and manufacturer and predominantly from the for the oil and gas sector so whether it be in aberdeen itself or you know are the ceiling egg or kishorn on on the west coast all of which have significant manufacturing infrastructure from the from the oil and gas sector in the in the 70s and 80s i would say you know that i've um looked at you know various innovation um scenarios for the for the wave entitled sector and and of course off offshore offshore wind and i think the important thing is that we focus on not deciding which region should be the heart of this technology but making sure that the uk as a whole is the is the heart of this of this technology so i think you know one of the most important things will be making sure that there is collaboration between the regions to make sure that overall the uk is successful rather than one particular region being successful okay madness you're muted marcus sorry sorry sorry i'm getting that uh thanks henry for starting off the dialogue um i'll maybe speak from a kind of welsh southwest angle because i'm actually based in in wales myself and there's a huge opportunity i mean there are huge opportunities across the uk we're an island nation at the end of the day and this is an industry that's touching most corners of the uk and that's one of the nice things about it but um off the coast of south wales and um off the coasts of devon and cornwall we have the celtic sea it's uh one of the largest areas that's kind of being penciled for floating offshore wind deployments in the future currently there's no offshore wind you know um history in this in this region of the uk but certainly a lot of developers are turning their attention because it is one of the best places in the uk to develop floating wind and that could transform places like south wales which is a very strong industrial heritage from oil and gas sector and steel making industries both sectors have gone through difficult times but one of the nice things about floating wind is that the turbines themselves and the substructures are assembled and built in ports so the difficulty at the moment is that we don't have the right port infrastructure but there are various dialogues going on about upgrading parts or getting the ports to collaborate and that will enable us to capture much more of the local supply chain content in these projects which you know these are aspects that the in the fixed bottom offshore wind industry we actually missed out on and and hopefully will avoid substructures being towed in in future projects okay that's great thank you yeah i realized that was a bit of a open-ended question so yeah thanks thanks both for for for your answers maybe maybe beth and and or ashley want to come in with some questions either from the q a or your own uh ideas for the panel so i'm going to jump in with an lcoe question uh from from has come in from our guests it is uh so those of you working with lce if you can answer this do you think that lcre is still in an appropriate metric given that it can't capture many dimensions such as the fact that marginal cost of intermittent renewables are virtually zero but their generation profile is inflexible so um i think henry if you can start with that and then maybe russell jump in on that um i i i would agree with where the question of what the question is leading to i don't think lce on its own is is enough i but i still think it's an incredibly useful metric in order to assess technologies against their their their competitors um but i think the more and more we're having to augment um the lcue metric in order to present to fuel a picture and so looking at the overall societal benefit jobs in gba to make a decision looking at the lca as well or the life cycle assessment is as well of of those of those technologies in order to have a fuller picture and so i would agree that sort of i would say that lcoe on its own is no longer enough and it does need to be augmented but it's still an incredibly useful metric would be my opinion yes but i'd probably agree with that uh henry um so yeah as i tried to illustrate in the presentation you know it only accounts for a fraction of the cost um of the whole integration and we need to bear this in mind probably we need an enhanced metric and that's what some of the the research is around lcoe is looking at you know what's the full system cost um in economic terms uh but even then there are other things that these metrics don't consider that we haven't really touched on yet in the in the this in the presentations or the discussion you know external costs of we talked about carbon but we didn't talk about any other externalities potential positive or negative impacts of some of these renewable technologies right so yeah i think i'd like to come in on that a little bit because uh you know there's no such thing as zero carbon anything because you have to manufacture all of the pieces of the turbine or the or any offshore installation so i think you have to consider the amount of carbon that actually goes into the not only the operating ongoing work that has to be done like the the boat movements and everything else and indeed building the boats but also the embedded carbon in the substructures of floating wind and the turbine blades and also this is where the id concept of a circular economy and recycling turbine blades comes in because turbine blames have an awful lot of hydrocarbons in them and what do you do with them at the end of their life cycle at the moment uh there's piles of them all over the world so yeah it's a big problem and it's it's something that needs a lot of research absolutely yeah thanks ashley in interest of time i'm aware that some panel members have to leave so there's another question from the q a that i'd like to direct to magnus in particular but by all means others if you have comments and it's about emerging or promising storage technologies which are not yet widely adopted so you know are there some technologies really quite even more nothing or younger than them uh tidal and wave that henry showed us in the presentation that you see perhaps in in 10 or 20 years time coming into the energy system um i would say we might see tiger tidal lagoons as well potentially so tidal range technologies it's kind of a similar theme i guess uh but particularly something that's of interest in south wales um beauty of tidal of course is that it's predictable both in terms of when you have the energy and how much um we touched a little bit on hydrogen certainly hearing an awful lot more of hydrogen i don't know if that still qualifies as being being new it's very much flavor of the month at the moment um but there's there's discussions about you know converting power to other commodities as well so such as you know ammonia would be would be another example um but uh those are some of the keywords i'm happy for anyone else to chip in if they've got other suggestions anybody else no so i wonder russell if we can ask a question very popular question in the audience here um and i think paul this comes towards you is it says do you see in the near future houses with zero dependency on external electricity suppliers and can we as householders become fully self-reliant say with the solar power etc and also what is that like in other countries not just the uk there's some questions about what would that that be like in africa so so yeah so there's a number of questions there so the first answer is yes you can become independent uh using solar power and you could do it in the uk as well as other countries or it might be easier in other countries particularly some more sunny ones um but but it would be quite an expensive thing to to become completely independent um and that's because you're going to have some substantial periods where you don't have solar power where you need to store sufficient electricity to meet your needs over those periods um and you also need if if you have very high power requirements within your house then you need to make sure your battery systems have sufficient power output in order to meet those two so so for example if i live in a more if i lived in the south of spain and i had a solar power um you know where you have um most of the year is sunny during the day you probably have a limit on the power in your flat of about four kilowatts because that's how the spanish electricity system works uh then it would be much easier having solar power and batteries it'll be much cheaper than if you if you live in aberdeen and you have a standard 18 kilowatt limit on your house and you might suddenly have demands that are much higher than what you can provide and you you can probably get to sort of 70 80 percent independent um for a fairly reasonable cost but that last 10 to 20 percent becomes really really expensive you need to have a lot of extra batteries in order to have not a lot of extra power which most of it isn't used okay and if we've got a chance there's one more uh question here that might a couple of people might answer it's about what are the main barriers to offshore wind expansion if they are so cheap and becoming cheaper to build and i wonder if that could be said for everything what what are the main barriers to the expansion of renewables i'll start very quickly from an offshore wind perspective but um the main issue at the moment is that we're sort of approaching the limits of current fixed bottom technology that can be deployed up to water depths of around 50 to 60 meters beyond that you need floating wind turbines and floating wind unfortunately isn't quite competitive at the moment and the difficulty is that 80 percent of the european wind offshore wind energy resource is is located in waters deeper than 60 meters there are a number of other challenges grid capacity would be would be another one but i'm happy for for anyone else to to chip in now too yes i'd fully agree maybe i could add something about onshore technologies i mean um a lot of my own research is especially related to onshore wind for example but also uh solar pv and you know some of the barriers there are mainly non-technical so we see that we've got these technologies in you know quite quite reasonable costs in a good location uh but we have other barriers such as opposition from the local population this idea of nimbi not in my backyard so the population wants to have wind or onshore wind but just not near to where they live or where they um you know where they would like to go for walks and recreation sites so certainly for for onshore wind that's a big issue for um solar pv it's less of an issue obviously if they're mounted on roofs or even ground mounted uh it seems to be that that's not such a acceptance problem because the impact on the landscape is is a lot less anybody else about barriers okay are we doing for further questions if we want to have one last question maybe or because we're a bit over time uh there's a lot of support for this question are there any emergence emerging promising storage technologies which are not yet widely adopted um so i'll come in on this one um i mean you could argue lithium batteries even not particularly widely adopted but they are starting to be uh in the longer term certainly hydrogen i think for for storage but you might have compressed air or liquid air storage which which this has been around for a long time but people are looking to make newer more efficient cheaper versions of it that that might be used in the future and they might provide more longer-term type storage um if if we purely look at l at storage technologies as opposed to storage technologies for the grid so if we start looking at mobile technologies for cars for example then things like lithium-air batteries if we could if we could make them work then they'd provide much higher energy density and they would give you a much better experience in vehicles um but that's not really specifically to specific that's not an issue for the grid grid scale storage where you don't worry about weight or volume so much sounds good okay thanks paul maybe just uh i don't know if this is a question or comment but maybe um i mean you mentioned lithium-ion batteries as an example this discussion is focused on cost but what about the more environmental or ecological implications there okay is any of you know us that are remaining here able to make a comment on some of the storage or renewable technologies how they are from a more sort of life cycle or ecological perspective uh i mean from storage perspective i don't think we have a very good um i don't think we have we don't have a very good understanding of the ecological impact i mean we know that we know there's limits for example to the amount of the amount of lithium and you can use certain amounts of precious metals that are that can be quite nasty things to actually get out of the ground and process and so people people worry a lot about um lithium in particular how to recycle the lithium and how to reuse it um in other batteries at a later date once once a particular batteries come to the end of his life so a lot of workers started going into that because fundamentally if we don't have some sort of circular economy around lithium we're not going to have enough we don't have enough lithium in the world that we at least that we know about in order to provide all of the batteries that we think we might need um so so that so there's a number of issues there but on a life cycle assessment we we have very little ideas and there isn't a huge amount of evidence out there and part of the problem is that people are constantly developing new processes to produce batteries that they're quite small modular things and so the lca can change quite quickly so so it's it's something that needs more work lots of potential for further research there okay thanks so with that i would suggest that we wrap up given that we're already over time so thank you to all of the panelists those who are still present on those who have already left of left us thank you to you the audience for participating in all of your questions and we look forward to meeting you in a future event such as this okay thanks goodbye

2021-11-23 09:11

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