Heat: detangling decarbonisation
Kevin Stickney, Managing Director at Erda Energy, argues clearer thinking is needed to meet decarbonisation goals in the heating sector.
If I asked you: should we get the train or drive? Take the motorway or the B-roads? Will the traffic be bad? You’d probably reply: well, where is it you’re going exactly?
Because trying to plan a journey without an idea of destination is doomed to fail. Yet that’s precisely where we’ve found ourselves in the debate around decarbonising heat in the UK.
We know some things for certain: 2050 is only 32 years away, by which time we need 100 per cent, total decarbonisation of heat to meet our legally and morally binding climate commitments. We also know that the two frontrunner ‘big ideas’ are electrification and greening the gas network with hydrogen. But that’s where clarity stops and we’ve jumped immediately to internecine squabbles about the costs and technical challenges of each. We’re fretting about traffic and lane closures before deciding where we’re headed.
That’s tangled thinking. Step one is to figure out which option offers the most credible path to complete decarbonisation (and can start having an effect immediately). Step two is to then address the challenges. Who picks where they’re going because the roads are clear?
The cart pulling the horse
Fretting about implementation challenges before assessing decarbonisation potential is putting the cart before the horse. How can we reverse that?
We can start with some basic questions. First, which technologies can deliver truly zero carbon heat and second, which can start to do so now? To the first question, we can answer electrified heat or electrolysis-generated hydrogen powered by zero-carbon generation.
To the second though, the only answer is electrification, where various technologies have existed for decades, such as air and ground source heat pumps, and are getting better all the time. Moreover, they rely on electricity to generate heat – recognisably the one area where we have achieved significant success in decarbonisation. Average grid carbon intensity stood at an estimated 254 tonnes of carbon emitted per GWh produced by 2016, down from 456 in 2010. What’s more, there is a credible (though not easy) path to zero carbon power. That means immediate carbon savings for electrified heat that will only grow as the grid greens.
Electrolysis, by contrast, is at least a generation away at a commercially viable scale. Nor will it appear spontaneously: most likely it will only take off if there is already an extensive hydrogen network, meaning in the meantime we’d need to rely on steam methane reforming (SMR), which releases carbon which would need to be captured by carbon capture and sequestration (CCS). That technology that doesn’t currently exist at the required commercial scale either. Bloomberg New Energy Finance’s Michael Liebreich recently wrote that “anyone promoting SMR-based hydrogen as a climate solution deserves their own circle of hell.”
Both options fail on beginning to deliver complete decarbonisation now. It could take 20-30 years to see these technologies deployed at the necessary scale. We can’t wait a generation to start serious decarbonisation of heat.
Rumours of impossibility, greatly exaggerated
So: electrification offers the only currently credible path to zero carbon heating. With that as a starting point – the horse firmly in front of the cart – what are the challenges that this approach faces and are they surmountable? What does the journey look like?
There is one overarching argument against electrification of heat that is put forward time and time again: that peak heat demand in the UK is roughly six times (‘6x’) peak power demand, and that the volume of extra generation required and the strain on the distribution grid makes it unfeasible. Thirty extra Hinkley C’s is one questionable figure bandied about.
But that ‘6x’ argument doesn’t stack up.
First, we have the fact that as a country we have been incredibly lazy when it comes to controlling heat. Cheap, plentiful North Sea gas has seen the UK trundle along with some of the most inefficient building stock in Europe. There are big, easy wins to be had by tightening building regulations to make our homes and businesses less wasteful (both Energy UK and the UK Green Building Council recently called again for action on this point). Reinstating the zero carbon homes policy that was scrapped in 2015 would be a start, as would upping the ambition on the new ECO consultation.
Then look at the opportunity presented by smart heating controls such as Hive and Nest. We are woeful at controlling heat in the UK but software will eat inefficiency and smartphone apps will boost user engagement to help reduce peak demand. Coupled with better insulated, less wasteful homes, we could see that ‘six times’ gap start to narrow pretty quickly (in fact, we already are). These are no-regrets courses of action that need to happen now.
Having reduced heating demand, we can start to think about how electrification fares at meeting what remains. Would it really create just too much power demand? It’s worth pointing out that we don’t reliably measure heat demand the same way we do for electricity. Usually we use gas demand as a proxy, so interlinked they are. But gas is never 100 per cent efficient, there is always wasted energy. So we may well find that final energy demand is a little less dramatic than we think.
Second, electrification and thermal storage technologies open up possibilities to time-shift demand, smoothing the ‘6x’ peaks. This could be as simple as filling a hot water tank when power is plentiful overnight, or as advanced as using geo-exchange to store heat in the ground over summer to be used in winter. Electric systems can also participate in demand response programmes, which are increasingly popular at the commercial and industrial level and promise great opportunity at the domestic one.
So, let’s start right now by getting a better understanding of actual heat demand and reducing it – that first part of the journey is the same regardless of the destination. Then let’s get clear about where we’re headed and start planning how to get there – not the other way around. It’s clear to me that electrification is the most viable route to truly zero-carbon heat and has the advantage that we have the proven technology to start right now. There are legitimate challenges – notably around the peakiness argument – but they have been shown to be overblown. In any case though, we need to detangle our thinking and start making decisions now. Climate change won’t wait. So, where to?
Carbon dioxide removal revenues worth £2bn a year by 2030
Carbon dioxide removal revenues could reach £2bn a year by 2030 in the UK with costs per megatonne totalling up to £400 million, according to the National Infrastructure Commission.
Engineered greenhouse gas removals will become "a major new infrastructure sector" in the coming decades - although costs are uncertain given removal technologies are in their infancy - and revenues could match that of the UK’s water sector by 2050. The Commission’s analysis suggests engineered removals technologies need to have capacity to remove five to ten megatonnes of carbon dioxide no later than 2030, and between 40 and 100 megatonnes by 2050.
The Commission states technologies fit into two categories: extracting carbon dioxide directly out of the air; and bioenergy with carbon capture technology – processing biomass to recapture carbon dioxide absorbed as the fuel grew. In both cases, the captured CO2 is then stored permanently out of the atmosphere, typically under the seabed.
The report sets out how the engineered removal and storage of carbon dioxide offers the most realistic way to mitigate the final slice of emissions expected to remain by the 2040s from sources that don’t currently have a decarbonisation solution, like aviation and agriculture.
It stresses that the potential of these technologies is “not an excuse to delay necessary action elsewhere” and cannot replace efforts to reduce emissions from sectors like road transport or power, where removals would be a more expensive alternative.
The critical role these technologies will play in meeting climate targets means government must rapidly kick start the sector so that it becomes viable by the 2030s, according to the report, which was commissioned by government in November 2020.
Early movement by the UK to develop the expertise and capacity in greenhouse gas removal technologies could create a comparative advantage, with the prospect of other countries needing to procure the knowledge and skills the UK develops.
The Commission recommends that government should support the development of this new sector in the short term with policies that drive delivery of these technologies and create demand through obligations on polluting industries, which will over time enable a competitive market to develop. Robust independent regulation must also be put in place from the start to help build public and investor confidence.
While the burden of these costs could be shared by different parts of industries required to pay for removals or in part shared with government, the report acknowledges that, over the longer term, the aim should be to have polluting sectors pay for removals they need to reach carbon targets.
Polluting industries are likely to pass a proportion of the costs onto consumers. While those with bigger household expenditures will pay more than those on lower incomes, the report underlines that government will need to identify ways of protecting vulnerable consumers and to decide where in relevant industry supply chains the costs should fall.
Chair of the National Infrastructure Commission, Sir John Armitt, said taking steps to clean our air is something we’re going to have to get used to, just as we already manage our wastewater and household refuse.
"While engineered removals will not be everyone’s favourite device in the toolkit, they are there for the hardest jobs. And in the overall project of mitigating our impact on the planet for the sake of generations to come, we need every tool we can find," he said.
“But to get close to having the sector operating where and when we need it to, the government needs to get ahead of the game now. The adaptive approach to market building we recommend will create the best environment for emerging technologies to develop quickly and show their worth, avoiding the need for government to pick winners. We know from the dramatic fall in the cost of renewables that this approach works and we must apply the lessons learned to this novel, but necessary, technology.”
The Intergovernmental Panel on Climate Change and International Energy Agency estimate a global capacity for engineered removals of 2,000 to 16,000 megatonnes of carbon dioxide each year by 2050 will be needed in order to meet global reduction targets.
Yesterday Summit Carbon Solutions received "a strategic investment" from John Deere to advance a major CCUS project (click here). The project will accelerate decarbonisation efforts across the agriculture industry by enabling the production of low carbon ethanol, resulting in the production of more sustainable food, feed, and fuel. Summit Carbon Solutions has partnered with 31 biorefineries across the Midwest United States to capture and permanently sequester their CO2 emissions.
Cory Reed, President, Agriculture & Turf Division of John Deere, said: "Carbon neutral ethanol would have a positive impact on the environment and bolster the long-term sustainability of the agriculture industry. The work Summit Carbon Solutions is doing will be critical in delivering on these goals."
McKinsey highlights a number of CCUS methods which can drive CO2 to net zero:
- Today’s leader: Enhanced oil recovery Among CO2 uses by industry, enhanced oil recovery leads the field. It accounts for around 90 percent of all CO2 usage today
- Cementing in CO2 for the ages New processes could lock up CO2 permanently in concrete, “storing” CO2 in buildings, sidewalks, or anywhere else concrete is used
- Carbon neutral fuel for jets Technically, CO2 could be used to create virtually any type of fuel. Through a chemical reaction, CO2 captured from industry can be combined with hydrogen to create synthetic gasoline, jet fuel, and diesel
- Capturing CO2 from ambient air - anywhere Direct air capture (DAC) could push CO2 emissions into negative territory in a big way
- The biomass-energy cycle: CO2 neutral or even negative Bioenergy with carbon capture and storage relies on nature to remove CO2 from the atmosphere for use elsewhere