Energy Efficiency. James Sweeney Stanford University Director, Precourt Energy Efficiency Center Professor, Management Science and Engineering

Transcription

1 Energy Efficiency James Sweeney Stanford University Director, Precourt Energy Efficiency Center Professor, Management Science and Engineering 1

2 World Energy Production and Use Quadrillion Btu of Production and Use Petroleum Dry Natural Gas Coal Hydroelectric Power Net Nuclear Electric Power Net Geothermal, Solar, Wind, Wood and Waste Electric Power Source: EIA, Annual Energy Review

3 US Energy Consumption By Fuel Source: EIA, Annual Energy Review 3 Coal Natural Gas Nuclear Hydroelectric Biomass Geothermal Solar/PV Wind Fuel Petroleum Consumption (Quads)

4 Energy Efficiency Compared to CO 2 -Free Energy Supply A 30% reduction in all energy intensity implies that 25.5 quads of fossil fuels are not used, reducing CO 2 emissions by 25.5% A 60-fold increase in wind plus solar can displace about 25 quads of fossil fuels. A factor of five increase in nuclear power can displace 30 quads of fossil fuels. 1 billion tons per year of celluosic conversion of biomass can displace 5 quads of gasoline.

5 U.S. CO 2 Emissions 2007 Million Metric Tons of Carbon Dioxide Natural Gas Petroleum Coal Most: Buildings Some: Buildings 0 Residential Commerical Industrial Transportation Electric Generation Source: 5

6 Million Metric Tons of Carbon Dioxide 2,500 2,000 1,500 1, U.S. CO 2 Emissions 2007 Through Electricity Natural Gas Petroleum Coal Most: Buildings Some: Buildings 0 Residential Commerical Industrial Transportation Source: 6

7 Why Do Negative Cost Options Continue? 7

8 Market Failures and Market Barriers Market failures Externalities Principal/Agent Problems Market barriers Low salience of energy issues Incomplete markets for energy efficiency Distortionary regulatory and fiscal policies Cognitive Skills Insufficient and inaccurate information Systems Issues 8

9 Externalities Externalities of Energy Use ( Unpriced costs and benefits ) Global Climate Change Risks of Energy Price Shocks Limitations on our Foreign Policy Options Terms of Trade Impacts (Pecuniary Externalities ) Automobile risk shifting by purchase of heavy vehicles Differentiations Oil strategic Fossil Fuel greenhouse gases R&D Externalities Individual firm may not be able to capture all benefits (especially significant for environmental benefits) 9

10 Principal/Agent Problems Where is problem? New Building Construction Rental vs Owner-occupied buildings Consumer Product Design Consumer Product Marketing Information/cognitive limitations generally central to agency problems Automobile design Electricity Use by TVs, passive chargers Incomplete markets for energy efficiency Discrete nature of commodities offered for sale Information problems when offering energy efficiency services 10

11 Market Barriers Example Cognitive issues: automobile purchase Automobile purchase decisions First cost bias Automobile design decisions Understand first cost bias Don t design optimally efficient cars Consumers don t have option to choose optimally efficient cars because they are not offered for sale Market stays in equilibrium Cognitive issues: programmable thermostats 2004 study. Only 20% of Americans own programmable thermostats. Of those, 70% don t use programmable features because they're too complicated. 11

12 Agency Problem: Market Penetration of Energy Efficiency Measures in Owner-Occupied and Rental Housing in California (CEC 2004) Owner occupied Rental 12 Market penetration (%) Insulated walls Insulated attic Double pane windows Programmable thermostat Compact fluorescent lamps Low-flow showerheads

13 Precourt Energy Efficiency Center 13

14 Liquid Transportation Fuels from Coal and Biomass Technological Status, Costs, and Environmental Impacts America s Energy Future Study Panel on Alternative Liquid Transportation Fuels

15 PANEL ON ALTERNATIVE LIQUID TRANSPORTATION FUELS MICHAEL P. RAMAGE, ExxonMobil Research and Engineering Company (retired), Chair G. DAVID TILMAN, University of Minnesota, St. Paul, Vice Chair DAVID GRAY, Nobilis, Inc. ROBERT D. HALL, Amoco Corporation (retired) EDWARD A. HILER, Texas A&M University (retired) W.S. WINSTON HO, Ohio State University DOUGLAS L. KARLEN, U.S. Department of Agriculture Agricultural Research Service and Iowa State University JAMES R. KATZER, ExxonMobil Research and Engineering Company (retired) MICHAEL R. LADISCH, Purdue University and Mascoma Corporation JOHN A. MIRANOWSKI, Iowa State University MICHAEL OPPENHEIMER, Princeton University RONALD F. PROBSTEIN, Massachusetts Institute of Technology HAROLD H. SCHOBERT, Pennsylvania State University CHRISTOPHER R. SOMERVILLE, Energy BioSciences Institute GREGORY STEPHANOPOULOS, Massachusetts Institute of Technology JAMES L. SWEENEY, Stanford University

16 TERMS USED Commercially deployable technologies have been scaled up from research to development to pilot plant and then have gone through several commercial-size demonstrations. Commercial deployment of a technology is the rate at which it penetrates the market.

17 BIOMASS SUPPLY Key Assumptions No indirect land use change and minimum competition with food. Corn stover Adequate corn stover be left in the field to protect and maintain soil resources. Dedicated fuel crops Biomass feedstock be produced on 24 million acres of CRP land in Woody biomass Estimates based on reports by Milbrandt (2005) and Perlack et al. (2005). Hay and wheat straws Yield increase over time = historic increase.

18 Millions of Dry Tons Corn Stover, 112 Normal yield grasses, 80 High yield grasses, 84 Straw, 18 Hay, 18 Woody Biomass, 137 Waste, 120 Woody biomass currently used for electricity generation not included 100 Corn Grain, 131 0

19 BIOMASS COSTS Biomass costs include costs of: Nutrient replacement. Harvesting and maintenance. Transportation and storage. Seeding. Opportunity costs (for example, cropland rental costs). The panel reviewed the literature and determined a low cost, a baseline cost, and a high cost.

20 Cost Per Dry Ton $140 $120 Total Cost Nutrient Replacement Storage Costs Transportation Chipping Fee Harvest and Maintenance Land/Biomass Opportunity Cost Establishment costs $100 $80 $60 $40 $20 $0 $20 Waste Woody Biomass Dryland or field run hay Corn Grain Straw High yield grasses Normal yield grasses Corn Stover

21 Supply function for biomass feedstocks in 2020

22 COMPARISON OF LIFE-CYCLE COSTS Miscanthus used as feedstock in all comparisons

23 Cost of alternative liquid fuels produced from coal, biomass, or coal and biomass with a CO 2 equivalent price of $50/tonne.

24 Millions Gasoline Equivalent BBL/Day 3.0 Commercially Deployable Cellulosic Ethanol Corn Stover, 0.4 Normal yield grasses, 0.3 High yield grasses, 0.3 Straw, 0.1 Hay, 0.1 Woody Biomass, 0.5 Waste, Corn Grain,

25 SUPPLY FUNCTION FOR CELLULOSIC ETHANOL (COMMERCIALLY DEPLOYABLE)

26 SUPPLY OF COMERCIALLY DEPLOYABLE CELLULOSIC ETHANOL, WITH CORN GRAIN Dollars Per BBL Gasoline Equivalent $160 $140 Hay Normal Yield Grasses $120 $100 Straw High Yield Grasses Corn Stover Corn Grain Waste $80 $60 Woody Biomass 50% Low Cost Gasoline from Crude $100 Gasoline from Crude $60 $40 $20 Assumed Carbon Dioxide Price: $50/tonne of CO 2 e No Indirect Impacts on Land Conversion $ Millions of Barrels Gasoline Equivalent Per Day

27 SUPPLY OF COAL-AND-BIOMASS-TO-LIQUID COMMERCIALLY DEPLOYABLE

28 COMPARISON OF CO 2 LIFE-CYCLE EMISSION Analysis assumes that conversion plants sell net electricity to the grid. Electricityrelated CO 2 emissions are dependent on the case: IGCC venting CO 2 for vent cases, and IGCC-CCS(90%) for CO 2 storage cases.

29 Detailed flows of CO2 emission over the life cycle of alternative-fuel production from the mining and harvesting of resources to the conversion to and consumption of fuel.

30 BARRIERS TO DEPLOYMENT Developing a well-organized and sustainable cellulosic biofuel industry Implementing commercial demonstrations of conversion processes ASAP Completing megatonne geologic storage demonstrations ASAP Developing more efficient, economical pretreatment and improving enzymes to free up sugars Permitting and constructing tens to hundreds of conversion plants Approaches that recognize commodity prices, especially oil prices, vary widely.

31 BARRIERS TO DEPLOYMENT Biomass Supply Developing a systems approach through which farmers, biomass integrators, and those operating biofuel-conversion facilities can develop a wellorganized and sustainable cellulosic-ethanol industry that will address multiple environmental concerns without creating unintended consequences through piecemeal development efforts. Determining the full greenhouse-gas life-cycle emissions of various biofuel crops. Certifying the greenhouse-gas benefits for different potential biofuel scenarios.

32 BARRIERS TO DEPLOYMENT Biomass supply Developing a well-organized and sustainable cellulosic-biofuel industry that will address multiple environmental concerns. Determining the full greenhouse-gas life-cycle emissions of various biofuel crops. Certifying the greenhouse-gas benefits for different potential biofuel scenarios.

33 BARRIERS TO DEPLOYMENT Market Penetration Approaches that recognize commodity prices, especially oil prices, vary widely. Permitting and constructing tens to hundreds of conversion plants and the associated, water requirements, fuel transport and delivery infrastructure

34 Energy Efficiency

35 Decreased Energy Use Reduced Economic Efficiency Increased Economic Efficiency Increased Energy Use 35

36 Decreased Energy Use Inefficient Energy Saving Energy Efficiency Improvement Increased Economic Efficiency Waste Economically Efficient Energy Intensification 36

37 Halt SUV Sales Gasoline Rationing Overly Strict Building Standards Some Rapid Transit Systems Incandescent Lighting Decreased Energy Use Plug-In Hybrids (Now in US) LED Task Lighting (Now) Hybrid Gas- Electric Vehicles LED General Lighting (Now) Gasoline Price Controls LED General Lighting (Future) Plug-In Hybrids (Future) Appliance Efficiency Standards Smart Regional Land Development Optimized Building Construction Driving Patterns Internet Growth (??) Economic development High Definition TV Old appliance replacement Behavioral Change: Program Thermostat Lights, Tire pressure, Energy Audits LED Traffic Lights Personal Computer Penetration Compact Fluorescent Penetration Improved Building Materials Pigouvian Energy Tax Airline Deregulation Accessible Business Travel Smart Buildings Controls Reformed CAFE Standards Energy Cost Labeling Congestion Pricing Increased Economic Efficiency Increased commercial space 37

38 Buildings Energy Use 38

39 2006 Commercial Building Energy Uses: Operations Only Unknown 7% Computers 4% Other 13% Lighting 25% Cooking 2% Refrigeration 4% Electronics 7% Water Heating 6% Ventilation 7% Space Heating 12% Space Cooling 13% Source: 2008 Buildings Energy Data Book 39

40 2006 Residential Building Energy Uses: Operations Only Computers 1% Other 4% Unknown 6% Lighting 12% Cooking 5% Electronics 8% Space Cooling 13% Refrigeration 7% Wet Clean 6% Space Heating 26% Water Heating 12% Source: 2008 Buildings Energy Data Book 40

41 Lighting is 21% of U.S. Electricity 41

42 From U.S. Lighting Market Characterization, prepared for DOE EERE by Navigant Consulting,

43 From U.S. Lighting Market Characterization, prepared for DOE EERE by Navigant Consulting,

44 Energy Implications of 100% 120 Lm/wt System Efficacy Current Mix All 120 lm/wt 300 TWhr/yr Commercial Residential Industrial Outdoor 44

45 Potential Economy-Wide Impacts of All LED Lighting use: 21% of all electricity use All LED saves about 60% of this electricity in long run: 13% of all electricity use after all adjustments Adjustment time Electricity cost impact Total cost of U.S. electricity Retail: $365 Billion per year Variable Costs: say $250 Billion per year 13% of $300 Billion dollars = $47 Billion per year 13% of $200 Billion dollars = $32 Billion per year US GDP $14.3 Trillion in