Blowing Hot Air

For all the talk, so many of the problems causing climate change, and the solutions to them, are hidden in plain sight – and now it’s time to do something about them …

Picture Credit: ChatGPT 4 with DALL-E

Nearly two and a half thousand years ago, Aristophanes, a Greek playwright, wrote and directed ‘The Birds’, first staged in 414 BC. The protagonist, a middle-aged man, manages to convince the birds to create a city in the sky, the Greek name of which translates into English as ‘Cloud Cuckoo Land’. The phrase (also the name of an acclaimed novel by Pulitzer Prize winner, Anthony Doerr) is associated with over-optimism, idealism, the expectation of the impossible, the fantasy of perfection and a perhaps deranged refusal to accept the boundaries of reality.

About two thousand years later in 1516, Thomas More named his concept of an ideal society ‘Utopia’, which translates from Greek into English as ‘no place’.

Yet here we are, over 500 years later, and it is hard to ignore disturbing echoes of The Birds and Utopia in the narrative around climate change and what to do about it.

This is partly because of a confounding blind spot for policymakers, and a dirty secret for the energy industry, which is responsible for some 80% of human caused excess greenhouse gas emissions. That is the extraordinary and scandalous fact, too rarely discussed in the media, that about 50% of the world’s primary energy is wasted in the form of heat in the generation process. Literally as hot air. I will explain more below.

But it is also because so many proposed solutions to the climate problem would take so much more time than we have available to keep global warming within limits. These days, we no longer rely on the birds to inform us, and we have thankfully retired canaries in coal mines and carrier pigeons. In November this year, the World Economic Forum reported that the world now has only six years to reduce carbon emissions sufficiently to avoid global warming (or ‘heating’) by more than 1.5C above pre-industrial levels, the target set by the Paris Agreement in 2015. The analysis is consistent with the 2020 reports by the UN International Panel on Climate Change (IPCC) and Carbon Tracker that I referenced in my book, ‘The Edge’, published in August this year in the UK and in the December in the United States. My book described that as the global surface air temperature was heating up, we were reaching limits for the climate, as well as planetary boundaries. 2022 was already breaking heat records and it was estimated that we hit 1.1C already. Most recently, the Copernicus Climate Change Service estimated that the world had already reached 1.25C in November 2023. With the El Niño weather event acting in concert with climate change, 2023 is expected to be the hottest year on record. We have no time to waste.

In the interests of time and staying both positive and open minded, I am not going to expose a series of ‘duds’ or ‘decoys’, as they are often labelled by analysts. Suffice to say that it is crucial to use the filters of resource efficiency, time and cost in decision making around energy technology. For example, where only 20-40% of the energy used in turning electricity generation into hydrogen for electricity makes it through to the end use, considering the reforming, electrolysis, conversion, compression, transmission, and distribution losses, then it is likely to be costly in both time and money, as well as wasted energy. And if carbon capture projects are implemented at centralised power plants without addressing the heat losses associated with the power generation itself, then not only is there a massive opportunity cost with failing to address the biggest part of the problem, but there are probably better uses for the $3.5 trillion that the IEA estimates would be needed to deliver them. By the way, I can’t resist imagining that that there is some prime real estate in Cloud Cuckoo Land reserved for whoever believes that awarding oil and gas licences the North Sea will solve the UK’s energy security problem; most of the oil will be exported and the gas, for which the UK would pay the international price, might last only about three weeks. I would also imagine that there might be hotel rooms available for whoever thought that it would be a good idea to dissolve the UK’s energy efficiency task force.

Staying positive, as recently as the last two weeks, in December 2023, after a challenging year for an industry facing increases in major project cost escalations and cancellations in the face of higher inflation, interest rates and longer timetables for planning and implementation, some of the largest scale renewable energy projects in the world have been announced. Pattern Energy’s 3.5GW SunZia $11 billion combined wind and transmission project announced on 27 December will be the largest clean energy infrastructure project in the United States, and Ørsted’s 2.9GW Hornsea 3 £8 billion offshore wind project in the UK will be the largest in the world. But projects of this scale, and even more modest ones, take time and money and highlight the importance of transmission, distribution and integration with the electricity network, which is facing gridlock. The International Energy Agency’s report published in October this year, ‘Electricity Grids and Secure Energy Transitions’, projected the need to add or refurbish 80 million kilometres of grids by 2040, the equivalent of the entire existing global grid – or enough power lines to wrap around the earth approximately 2,000 times. The enormous volumes of materials and the realistic time and cost involved in sourcing the metals, minerals and other resources needed to plan and build out new clean energy infrastructure is covered in Chapter 2 of my book.

So, what can we do to have the biggest impact in the limited time we have? To start with, we can be more honest about the problem itself. In July this year, the Lawrence Livermore National Laboratory published its 2022 ‘Energy Flow Chart’ for the United States, as did the ‘Digest of UK Energy Statistics’ and the Department for Energy Security and Net Zero in the UK. The data uncovers how most energy is wasted in the system. Losses occur earlier, in the extraction and conversion process. But the scale of losses in the electricity generation, transport, and industrial processes (as waste heat), as well as the transmission and distribution processes, is stunning. In the United States, the overall number for ‘rejected energy’ (i.e. waste) versus ‘energy services’ (i.e. useful) is 67.1%. In a country that spends over $1 trillion on energy and over 5% of GDP in a year, this implies a staggering economic cost. The losses are worst in transport (78.9% is rejected, representing nearly a third of all rejected energy) and largest in electricity generation (64.3% is rejected; over a third of rejected energy).

This is substantially for the same reason – heat losses. The thermodynamic limits of engines and turbines means that only about 50% of fuel converts to electricity and the remainder to heat. Unless the heat is recovered, it is lost. Similarly in combustion engines in cars, where at most 50% of the power supplied is converted to mechanical energy to propel the vehicle, with the rest dissipated as heat. Energy used in a traditionally invisible part of the food production process suffers the same fate. The Haber-Bosch process plays a crucial role in producing fertilizer and therefore in global food security, but it is highly energy intense and inefficient. Most of the energy losses are incurred by converting methane, from natural gas, and water into hydrogen and carbon monoxide. The high temperatures required lead to heat dissipation, particularly in preheating and steam generation.

Perversely, we need heat - a lot. In fact, there is currently as much demand for heat as for electricity. The carbon intensity will change with electrification, but it will take decades and trillions of dollars, particularly given the scale of catch-up required to increase the share of electricity that comes from green sources today – less than 30% - and even before the rest of the economy is electrified and fossil fuels (which still represent some 80% of the world’s energy supply) are meaningfully displaced.

The great news is that there is an abundance of cost-effective solutions to this problem, but that makes it all the more important to solve it. Decentralised energy generation, using any number of applications, is a big part of it, generating energy closer to the point of use, or even on site. Doing so provides the opportunity to use heat generated, rather than wasting it, for instance to provide high temperature process heat to industry or low temperature heat to domestic users. At Sustainable Development Capital (SDCL) our co-generation projects in London and New York for hospitals and commercial buildings, as well as for datacentres in South Dublin, attest to the combined electrical, thermal, and cost efficiencies that can be achieved. We have invested in solutions that recycle waste heat and gas as fuel to generate electricity and steam for ‘hard to abate’ sectors like the steel industry. We have invested in on-site solar and storage for commercial and public buildings. We have invested in geothermal applications to provide power and heat directly to end users rather the grid. We have invested in applications of technology that can store energy (even non-dispatchable renewables) as heat at industrial grade temperatures. Heat pumps are finding their place in industrial as well as domestic applications. And we have tackled bottlenecks in lower emission electric vehicle deployment by investing in ultra-fast charging infrastructure.

Solving the problem of the wasted heat that the global economy is literally blowing out as ‘hot air’ is therefore crucial for economic productivity and competitiveness. Projects, which are scalable through replication, can often be designed and implemented in months or a few years, rather than many years or decades to commission new centralised capacity. And they don’t need much of the transmission and distribution infrastructure to enable them, and so avoid the associated gridlock. Furthermore, saving energy by upgrading heating, ventilation, and air conditioning systems, as well as insulation, lighting, motors, management systems, controls, and software can save 20-30% of the energy that survives to the point of use.

Being more efficient on either the supply or demand side reduces the amount of energy needed to create the same output. It’s therefore cheaper than business as usual. Indeed, if an economy, or a business, stops wasting most of its energy and uses less, the economic productivity and competitiveness benefits are immense. I don’t mean doing less. I mean doing the same, or more, with less. It means better growth, not de-growth. And at a time when global competition for energy resources in contributing to geopolitical conflict and uncertainty over energy prices, inflation, and the cost of living for consumers, efficiency is an imperative for energy security, which was a key objective for the US Inflation Reduction Act and the EU’s policy of ‘energy efficiency first’.

Simply put, efficient and decentralised generation of energy (or ‘EDGE’) solutions represent the largest, fastest, cheapest, and cleanest source of greenhouse gas emission reductions and energy security. For the first time, energy efficiency made it to the top of the agenda in the Dubai Agreement concluding COP28. Most of the media discussion still centred around the various words that would be used to describe a ‘transition away from fossil fuels’. This will not be easy or fast, for some of the reasons discussed above. Substantially all food depends on fossil fuels to make it or transport it, and renewables have a long way to go to displace the use of fossil fuels in electricity, let alone to electrify everything. Nor will the tripling of renewable energy capacity get us to enough decarbonisation, let alone ‘net zero’. But now, despite all the talk, an ‘old hand’ is the new ‘power player’ – energy efficiency. Twinned with renewables as the top priority for which all governments are being called on in the Dubai Agreement resulting from COP28, we might finally be getting into a position to stop blowing so much hot air.

“If you have built castles in the air, your work need not be lost; that is where they should be. Now put foundations under them.” Henry David Thoreau.

Here on Planet Earth, rather than Cloud Cuckoo Land, humans are emitting more greenhouse gas than the planet can absorb, which is trapping heat and warming it. It stands to reason that we should not be blowing more hot air, but less.

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