Day 2 at the Energy 2050 Summit – what went on, who said what?
The agenda for Day 2 of the Energy 2050 Summit was wide ranging. From predicting the future to the energy mix, from the decarbonisation of the National Grid to perceptions around nuclear energy – our speakers and panellists brought an incredible range of perspectives and knowledge to the day.
Key themes which emerged over and again included the challenge of meeting a hugely increased demand for electricity, the suitability of infrastructure for this shift, the role of gas in the energy transition and the importance of consumer behaviour.
Oh yes, we like to stimulate debate…
Decisions, Decisions…
How do we predict the path of the energy transition? Clear, robust signals are required in any industry to encourage investment (to the tune of $5.3trillion by 2050) and minimise risk.
Emma Champion of BloombergNEF began the first session of the day with a clear message that economics are they key driver in shaking up energy systems, with wind and solar growing rapidly due to economic competitiveness and cost-effective building.
BloombergNEF forecasts that gas will provide less than 10% of our generated electricity by 2045, and the demand for electricity will keep growing, not least due to our increased use of electric vehicles, heat pumps and the requirements of industry. However, the research suggests that there is still a significant gap to fill before achieving the net zero target. Looking at what it takes to become fully Zet Zero, BloombergNEF suggests a reliance on green hydrogen and electrification is key.
Andrew Perry of artificial intelligence experts, Faculty, tackled the complex decision making that is required as we transition – made all the more complex by our production of 50x more data than in 2010. Data silos, overwhelming amounts of data present hurdles in the decision-making process of the energy transition. Andrew suggests that it’s time to move decision making beyond data, and focus on cause and effect – this is where artificial intelligence (machine learning) can help accelerate the energy transition.
Mixing It Up
A panel of four experts came together to discuss in fascinating fashion the energy mix progress towards 2050, providing diverse perspectives. Ville Rimali of Wartsila made clear the need for flexibility – there is no one solution. Joe Siefert of Vertex Hydrogen gave insight into the role low carbon hydrogen will play in the UK energy market, noting that the UK hydrogen policy is the most advanced in the world, and that projects like the HyNet North West Cluster (due to start production in 2026) are, in fact, a route to safeguarding our industries and 1000s of industrial jobs.
Green hydrogen and ammonia production were also on the agenda, with Olivier Mussat of ATOME discussing his company’s activity in Paraguay, one of the largest exporters of renewable energy. Like so many of our speakers on day 1, he focused on the need for speed in this energy transition citing ammonia as efficient and easier to store than hydrogen and key to the decarbonisation of fertiliser, chemical, refining, power and shipping fuel industries.
Wade Allison, University of Oxford focused upon the social and cultural changes required for society to consider nuclear energy as a safe, viable source of renewable power – noting that we welcome radiation for its effects in other areas of our lives- not least healthcare. He underlined the fact that nuclear safety regulations are currently out of proportion to the actual risk, which is ultimately costing the environment as we move towards “safer” low density energy alternatives. Highlighting the unreliability of wind, solar and hydro power – and the impact they have upon the land and surrounding environment due to required scale – there is much to be done in terms of redressing the reputation of nuclear energy for the benefit of a sustainable energy transition.
Energy Transition and Role of Gas – One Size Does Not Fit All
Alasdair Mackenzie of Nigerian Seplat Energy turned the discussion towards Africa’s energy transition, discussing the balancing act between climate reality and the potentially less well understood reality for Africa, which includes the lack of access to electricity experienced by 600million Africans, a lack of reliability of generating capacity and infrastructure and a dependence upon fossil fuels to support revenue generation. Quoting the Nigerian president, he commented that “Africa’s future must be carbon free, but current energy demands cannot be met solely through weather dependent solar and wind power.”
Gas therefore is deemed to play a crucial role in Africa’s energy transition, when it comes to, for example, providing a cleaner alternative to some 15million diesel petrol generators or improving utility scale generation for megacities and stimulating the creation of jobs.
Leading a panel consisting of Alasdair, Rajat Katyal of HSBC, Adrian Dorsch of S&P Global Platts and Francis Ghiles of CIDOB, our moderator, Ed Reed, looked at the profile of gas as a transition fuel in Africa and beyond, in particular the future of gas in the European market and the shift in perception during 2022 of its role.
A common theme across the following discussion was – unsurprisingly – cost. Heating in Europe accounts for more than 50% of gas demand and the implementation of heat pump alternatives to traditional boilers is challenged both by price and by an available supply chain. Panel predictions were for a strong gas demand up to 2030.
Hydrogen – A Question of When, Not If
Has the war in Ukraine accelerated our transition from gas? Rajat Katyal believes so and also believes that the UK is already ahead of the game. The panel agreed that gas is compatible for a drive to net zero and will undoubtedly be required over the next 5 – 7 years, playing a role but as a stop gap. The panel was asked its opinion on the future of LNG, which it agreed provided a level of flexibility and shorter-term commitment which it felt may suit the market in comparison to large scale pipeline projects.
However, as gas prices decline over the next 30 years, the panel agreed that the most cost-effective product would “win”.
“We’re All in This Together”
National Grid has a single purpose – to be at the heart of tomorrow’s clean, fair and affordable energy future, operating the grid at 100% decarb in UK by 2035. David Wright, Group Chief Engineer spoke to us having recently returned from COP27, and shared some of his takeaways from the high profile climate event.
Mentioning that it was a more diverse event than ever before, he told our audience that the UK is clearly acting as inspiration for other countries, who are looking to learn from our world-leading renewable energy industry and strategy. Bearing this in mind, David believes that the energy transition needs to be set against a global context – it cannot be thought of on an individual country basis.
Climate resilience and adaption plays a huge role in National Grid’s strategy vision to create fossil free heat, utilising an innovative climate change risk tool to better understand vulnerabilities of extreme weather/climate change, optimise the engineering changes that need to be made and deliver the solutions that ensure capacity and resilience. The panel session which followed David’s keynote also featured Duncan Burt of Reactive Technologies, Dan Williams of measurable.energy, Johan Plessis of tepeo and Lloyd Butterworth of Fred. Olsen & Co. who each discussed their innovative responses and technologies to help accelerate decarbonisation of the grid.
A key theme throughout the discussion was the need for flexibility and a shift in energy consumption as it rises from 25% to 65/70% in the latter part of this decade.
Moderator, Gayle Meikle, asked What does future look like for our homes?
Panel answers included:
“Today we despatch energy generation to meet the demand, this needs to reverse. The power grids of tomorrow will have flexibility at their core and long duration storage is the key challenge to crack.”
“Great technology is simple technology. It needs to be as simple to plug in our EVs as it is to use our toasters. There’s a long way to go.”
“We need to speak to the majority of consumers – not the technical fans. A change in consumer engagement around their energy systems cannot be expected.”
Question from the audience: What else could the government be doing?
“The complete restructuring of the energy economy away from fossil fuels. There are regions doing a great job in this respect, particularly from entrepreneurial perspective. Those who don’t - and are not encouraged to do so – will fall behind.”
“A relaxation of planning legislation around onshore wind construction.”
Question from the audience: How will we change consumer behaviour?
“Incentivising customers to switch off will be key; consumers are still not as willing as we may think to change behaviour.”
“Consumers need to be exposed via smart metres to see what’s happening in power markets at different times of the day for example.”
“Not enough homes are monitored to allow us to come out with real innovation on tariffs/smart tariffs. Open data is at the core of this shift in use as it will be applied to make appealing options to consumer.”
“A system change will not come from the consumers themselves – it needs to be policy led.”
“The Ultimate Origin of Energy”
Building upon Wade Allison’s earlier session and to discuss the often-controversial place of nuclear energy upon the energy transition, we brought together Mikal Boe of CORE POWER, Kirsty Gogan of TerraPraxis, Ivan Baldwin of Bechtel Corporation and Martin Porter of the World Nuclear Transport Institute. The session was chaired by Tim Yeo of New Nuclear Watch Institute who offers the opinion that the international tide against nuclear infrastructure has shifted recently.
Mikal’s first words summed up his perspective when he told the audience that “all energy originates from nuclear fusion or fission” and that “nuclear has been beaten up for decades”. He posed the question as to why this is the case, given that nuclear energy is proven to be clean, safe, abundant and can support humankind, supplemented with wind and solar energy.
Perceived Barriers
Ivan Baldwin brought his significant experience in delivery of nuclear plants to bear when answering the perceived barriers to nuclear energy, which he itemised as 1) too difficult 2) long construction projects 3) too expensive and 4) “People don’t want nuclear in their backyards”.
Ivan refuted points 1 – 3 by detailing the volume of nuclear construction that has taken place on a global scale over recent decades. When it came to point 4, he suggests that there are communities who do value the jobs and supply chain opportunities. And expanding on that, Ivan acknowledged a lack of skilled resource, but pointed out that this is in common with all energy sectors and collaboration to encourage cross-sector skills transition is a huge opportunity.
Public Perception
Martin Porter told the audience that the nuclear prize is clear – very clean energy, 24/7.
He identified two difficulties in putting nuclear in the public domain; acceptance and permissions. Regulatory change is disproportionately difficult in the nuclear sector, and the public perception of the trefoil is regarded as an indication of danger. Audience member, Wade Allison agreed and suggested the education to the contrary must begin in schools, whilst Ivan Baldwin documented that he had experienced resistance to this option.
Kirsty Gogan underlined the unparalleled safety record of nuclear power and suggested that establishing a continuity of build is critical to achieve cost targets, scheduled outcomes and a sustainable workforce. She believes we need to communicate the lack of risk associated with nuclear energy to facilitate the decarbonising of coal and replace fossil fuels. She is committed to the potential for nuclear in the energy transition, reusing as much of the existing infrastructure as possible to reach a sustainable, on target decarbonisation, to create profitable operations, whilst leveraging the skills and capabilities of other industries.
Energy 2050 Summit closes for another year, but all sessions will be available on demand soon.
Huge thanks to all those who contribute and attended, in particular our sponsors Seplat Energy, National Grid, Essar, Stanlow Terminals, Vertex Hydrogen, Faculty and Alchemist.
