Global Energy Outlooks - BP v Jacobson

The share of renewables in global primary energy may increase ‘from around 10% in 2019 to between 35-65% by 2050, driven by the improved cost competitiveness of renewables, together with the increasing prevalence of policies encouraging a shift to low-carbon energy’. So says BP in its latest Global Energy Outlook. It does see wind and solar accounting ‘for all or most of the growth in power generation’, but even at the top of the range quoted, it still falls a lot short of the renewable ‘100% of total energy’ scenarios that have been produced by some academics in recent years. 

To fill the gap to zero net carbon, BP sees wide-scale use being made use of carbon capture technology, as well as some nuclear power. And it says ‘Natural declines in existing production sources mean there needs to be continuing upstream investment in oil and natural gas over the next 30 years’.

You won’t find much support for these fossil and nuclear options in the scenarios produced by Stanford Universities Prof. Mark Jacobson. As he recounts in his latest book, he is convinced that we can use existing technology to get to 100% renewables for all energy by 2050 or earlier, at lower cost than on current plans like BPs, which include the use of nuclear and CCS, along with some renewables. He is certainly no fan of nuclear, which he sees as a diversion, too slow to build and too expensive compared with wind and solar:  ‘You end up waiting 15 to 20 years longer, for a seven to eight times higher electricity price - it just makes no sense. Even if they improve [build times], say to 12 years, that’s still way too long. We have cheaper, faster, safer technologies. Why waste time?’

However, although BP sees nuclear as expanding, it’s to a lesser extent than renewables and its mostly in China. But BP also sees bio-energy use as expanding quite significantly, including biomass combustion with Carbon Capture and Storage, whereas Jacobson, and some NGOs, see the use of biomass, and also BECCS, as being environmentally dubious.

So the battle of tech choices goes on. The gap between the academics/NGOs and the coal/oil/gas companies used to be very wide. As the extent of the climate crisis becomes more apparent, it’s less so now, but there are still big issues. Demand projections are getting more realistic (e.g. by 2035, BP has gas and oil at 5-6% less than in last year’s projection), but they still do not take into account all the possible savings. Renewables are now seen as winners not losers, but it’s still claimed (e.g. by nuclear enthusiasts) that we will need more nuclear to keep emissions down. 

The bottom line is likely to be the cost. Jacobson is adamant that renewables offer the cheapest way ahead, and that does seem credible from the LCOE data.  And he is keen to press on fast: ‘The goal is 80% by 2030, and 100% by 2050. But, ideally, if we can get 80% by 2030, we should get 100% by 2035 to 2040.’ That’s partly since he says the faster we move with renewables the more we will save in cash and also carbon terms: it means an end to the drilling and mining for the fossil fuels that consume about 11% of all energy. He says that, overall, with electrification via renewables and improved end-use efficiency, you will get 56% less energy use on average from 2035 to 2050- and average bills will fall 63%. What’s not to like?  And he’s not alone in thinking that going faster is possible and would make sense. But he says, the challenge is to get ‘the political willpower to focus on a narrow set of solutions that we can implement quickly.’

BP may be more cautious about focusing just on renewables, but it does admit that, following the Russian invasion of Ukraine, increased energy security concerns are likely to trigger a shift towards a more local, lower-carbon energy mix- and for that to happen quickly.   

So, although there are differences in focus, there is some degree of agreement on pace, and on the main set of technologies proposed- wind and solar.  There is also some agreement on how the variable renewables might be backed up, via batteries for the short term and with  cavern-stored electrolytic hydrogen for long duration power balancing. Although there would have to be more green hydrogen in Jacobson’s scenario, since that has more renewables, that’s arguably fine, since, with more renewables, there would at times be more surplus to convert into hydrogen to meet lulls in supply or peaks in demand. BP does include some blue hydrogen, made from fossil gas, but producing that is not carbon free and it’s not used in Jacobson’s 100% scenario, while in BPs ‘net zero’ scenario, by 2050, around 65% of the hydrogen used is green.   

There are debates about whether to convert green hydrogen to methane (CH4) using air captured CO2, as researchers at  LUT University in Finland have recently proposed in their 100% renewable energy scenario, since methane is easier and cheaper to store in bulk.  However, the conversion process needs energy, and adds to the cost, and the eventual combustion of methane to make power again releases the CO2 back into the atmosphere.  The debate over that will no doubt  continue, but it does seem clear that, whichever scenarios are adopted, and whatever the end-uses, there will be demand for clean green hydrogen feedstock, with a recent review suggesting that there will be a $120 bn global hydrogen electrolysis market by 2033. That’s up from small amounts at present, with green hydrogen only accounting for about 1% of total hydrogen production globally. 

One way or another, even with BP’s relatively limited approach to renewables, things look likely to change radically. BP says that ‘the increasing dominance of low-carbon energy, together with the use of CCUS, cause carbon emissions from power generation to fall by around 55% by 2035 and to be virtually eliminated by 2050’.  Jacobson’s scenario achieves that and more, with full decarbonisation of all sectors by 2050, and maybe earlier, and also, he claims, at lower cost. And, arguably, with fewer technology risks. Take your pick!