Why can’t we be friends? The case of lithium ion batteries and fuel cells

Tesla’s rise from the play-thing of millionaires, to one of the world’s most valuable automotive companies and most recognized global brands, is the shot in the arm for green mobility that the world surely needed. Indeed, few automotive companies could claim to have made significant progress in decarbonizing the mobility sector before the Model S, Model X and eventually Model 3 entered the scene. The biggest exception being the Nissan Leaf, which is the worlds most sold electric vehicle model, with more than 320,000 units shipped to date[1].

However, while there are many things that the world should thank Elon Musk for, his antipathy to Fuel Cells is not one of them. While there is little point in denying the discrepancy in electrical efficiency between a Battery Electric Vehicle (BEV) and Fuel Cell Electric Vehicle (FCEV), to call the technology “mind boggling stupid” is green-on-green fire at its finest. At a time where less than 3% of global energy in transport is considered renewable (largely composed of biofuels, whose green credentials are frequently challenged), it is more important than ever to focus on the real goal – the gradual phasing out and substitution of internal combustion engine (ICE) vehicles.

The BEV advocate arguments against FCEVs are clear. The technology is too expensive, and its round-trip efficiency remains significantly below BEVs (around 45%-60% for FCEVs v.s. 80%-90% roundtrip for BEVs). For these reasons, BEV advocates are concerned that less knowledgeable policymakers and indeed consumers, will conflate FCEVs and BEVs, creating a convenient excuse to prolong the life of ICE vehicles. Further, BEV advocates sometimes articulate genuine concerns that in an environment where public sector investment is constrained, dividing limited resources between building infrastructure for BEVs and FCEVs results in underdeveloped networks that delays the public uptake of both.

Source: CCC, 2018, p.56, https://www.theccc.org.uk/wp-content/uploads/2018/11/Hydrogen-in-a-low-carbon-economy.pdf

These concerns are well founded. But they are also wrong.

Firstly, BEV advocates often forget that the story of Hydrogen is much bigger than mobility alone. Indeed, the current global Hydrogen market is already valued at in excess of $100bn per annum (and forecast to grow at 8% pa until 2026), in contrast to the automotive battery market (including Li-Ion), which will reach USD $95bn by 2025 (at a forecast growth rate of 7.9% over the period). Further, Hydrogen is forecast by Shell, the IEA, IRENA and leading OEMs to be the key source of fuel for heavy mobility, driven by the inescapable fact that hydrogen is simply more energy dense than any battery alternative available and even at scale, it retains a lead over Li-Ion solutions.

Source: Hydrogen Council, 2018, p.14, http://hydrogencouncil.com/wp-content/uploads/2017/06/Hydrogen-Council-Vision-Document.pdf

Beyond mobility though, many see Hydrogen as the only serious solution (alongside CCS) to large scale de-carbonisation of the World’s largest source of energy demand – heat. Indeed, demand for energy for industrial, commercial and residential heat accounts for over 50% of global energy consumption, with few clear solutions beyond Hydrogen and/or CCS available (and in some instances electrical solutions, mainly at lower temperatures). Indeed, countries like the UK are already exploring if Hydrogen could de-carbonise an entire countries gas grid by 2050, while the EU is funding a range of pilots that utilise Hydrogen as a feedstock for the steel industry.

Consequently, whether BEVs dominate the mobility sector in the short to medium term or not, Hydrogen and Fuel Cells are not going anywhere. Indeed, the technology itself is already over 150 years old, with the first fuel cells made in 1830.

The second point though is that BEV batteries and fuel cells are actually natural partners. The BEV may be considerably more efficient for short distances, but over long distances the charging issue remains a significant (and in some cases perhaps insurmountable) barrier to erasing consumer range anxiety concerns. Combining batteries for short journeys and a fuel cell for long distances is a natural hybrid, and one which automotive companies such as Mercedes have already realized. The GLC F Cell is the start of a trend that illustrates the value of such clean energy hybrids, allowing up to 450km of range and thus averting consumer range anxiety concerns. Further, such hybrids allow grid planners to focus on developing EV charging infrastructure at the sub 50kW range, leaving the more immediate refueling needs to Hydrogen refueling stations.

The importance of hybrid infrastructure is important. It is easy to forget that few countries have sufficiently modern and robust grids to support rapid charging at the scale needed for global EV roll-out. Indeed, many countries do not have fully automated SCADA systems at the distribution level and are frequently impacted by rapid voltage fluctuations. This is compounded by the fact that many grid operators have a limited understanding of the transportation sector, and few automotive manufacturers understand the impact of their operations on national grids. A good example of this informational gap can be seen in the relative lack of discussion around whether the grid reinforcement requirements for installing superchargers are reasonable for utilities (and ultimately consumers) to incur, especially where the location is remote and there may not be significant local generation resources available. This is not to say that rapid charging systems are not perfectly applicable in well developed and automated grids, with careful planning and close coordination. But to assume this is the case globally, particularly in many emerging markets, is unrealistic.

BEV advocates may, and indeed do, reject these concerns. The increasing range of batteries and changing consumer patterns are frequently cited as evidence that the barriers to BEV adaption can be surmounted. Further, the nature of certain vehicle applications that have a “return to base” function, increase confidence that significant and widespread BEV supercharging is less of a barrier for commercial vehicle fleets and municipal owned vehicles. Many also argue that BEVs provide battery storage resources to the grid, thus strengthening it rather than weakening it. This may all be true, but the world is bigger than California and Germany.

Few BEV advocates have successfully explained how widespread fast charging BEV infrastructure can be developed outside of developed countries, where grid failures are common and where the initial experiences with rapidly fluctuating levels of power demand and supply on the grid are already causing challenges. Further, while hydrogen can be stored for months and can be generated and transported across multiple areas, it is less clear how BEVs can provide comparable flexibility to ensure rapid charging for vehicles across large remote areas. Indeed, this may explain why countries like Australia are increasingly investing in both BEV and FCEV.

But even if the hatchet between BEVs and FCEVs cannot be buried for mobility, it is important to note that for the power sector these two technologies are already being paired. Indeed, the Raglan Mine micro-grid and HDF Energy’s project to replace diesel gensets in French Guiana, both show that hybrid battery and Hydrogen Fuel Cell base systems, have a powerful complementarity that should be recognized.

Ultimately emotions will probably determine the future of relations between BEV and FCEV advocates more than economics or technology arguments alone. But with the growing global pressure to accelerate the clean energy transition, and to meet the 1.5 degree target, it may be preferable for these technologies to take a moment to assess if the perceived enemy is not in fact a natural friend.


[1] CleanTechnica have also argued that even by 2021 the Nissan Leaf will remain the most sold EV vehicle globally: https://cleantechnica.com/2018/12/25/the-best-selling-electric-vehicles-when-will-tesla-model-3-be-1/

May’s masterclass in politics

It may have been long overdue (like the pun there?), but the UK Prime Minister’s decision to call a general election this morning was a piece of political masterclass and a bold, calculated gamble.

By calling a general election Theresa May is attempting to resolve several major headaches at once, assuming that she is successful: Firstly, the move creates political certainty in the UK at a time where it is sorely needed. Secondly, the move will end questions around the Theresa May’s political support within the party itself and lastly it will strengthen the UK’s negotiating hand with the EU.

If the Conservatives win (especially by an increased margin), then Theresa May will have a clear mandate for her Brexit negotiation strategy. This will give investors, businesses and political leaders a greater sense of what the UK will choose to prioritise and a clearer idea of which figures will manage the UK’s transition from a full EU member state to an independent nation. Assuming that the PM will stay for a full five-year term, the Conservatives would govern until 2022, giving them the ability to handle the transition after Brexit as well and a chance to resolve any outstanding issues with EU members, the WTO and Scotland.

The surprise election is also likely to be popular with the Conservative political base, partly because the opposition are so weak. Labour remains extremely divided between its core factions, while the Lib Dems will have a mountain to climb to recover even the 40 seats it previously held before 2015. The SNP can only lose from their current position and Northern Ireland has been in deadlock since the last regional government collapsed. In 2015 UKIP won 3.9 million votes, today the country has voted to leave and they have no credible or popular leader. All of this explains why the polls suggest a clear Conservative lead, and even though polls have been consistently unreliable in the last 18 months, few polls have predicted a winning margin of this magnitude that has been overturned in such a short time period.

The reason why winning an election is important however is that it is the key to ensuring party unity. The Conservative party is famous for its political backstabbing and without an election win under her belt, the PM would have been vulnerable to challengers if the EU negotiations turn ugly. Incidentally there are even rumours that the election will help to neutralise the Conservative political right, by forcing the PM to adopt a less aggressive position to win the election. If the Conservatives wish to keep seats in London and the South West, they will need to win over unhappy remain voters and soft Brexit voters. With a mandate to govern secured on a hard Brexit, with very flexible immigration and extremely close ties to the EU, the PM will neutralise the Tory right and move the negotiations towards a less confrontational position.

The UK has had a number of challenges in getting the EU to agree on even basic terms for Brexit. The UK gave notice that they would invoke Article 50 at the end of March, but the EU has focused on the “negotiating framework” for the Brexit discussions. This focus has been both strategically and tactically driven. Strategically, by agreeing the framework for talks in advance the EU can already try and dictate the terms of the UK’s exit. Tactically, the major EU decision making member states either have elections, just had elections or have elections due in the next five months (The Netherlands, France and Germany), so delaying the main issues until after September avoids discussing the issues during elections.

The EU commission had assumed that after the EU’s major elections, its leaders would have fresh electoral mandates and solidarity across the block. This would have put the PM at a considerable disadvantage, as the EU could have decided to target politically sensitive areas like agricultural tariffs or financial service access to secure concessions. This threat has now been taken off the table. Even if the EU makes threats against these sectors, it will take years for the full effects to come through and politically speaking, the EU has lost its ability to alter who it will be negotiating with on the UK side of the table.

This is a move that carries risks though. Firstly, Labour may be more resilient than expected and the Lib Dems may well recover the 40 seats that they lost. If such an outcome occurs, the UK would have a hung parliament and the UK would enter a constitutional crisis. It is unlikely that the Conservatives could form a viable coalition at this time, but it is also unclear whether an SNP/Labour/Lib Dem coalition would be any better. This being the case, there is a chance that the UK might have a second election within a few months of the new one in June. Needless to say, Theresa May would be extremely damaged as a leader if the Conservative party did not retain an overall majority, while any further Labour party losses would trigger another bout of in-fighting over the need for  new leader to replace Corbyn.

The last piece of this story is that an election on which party will govern during and after Brexit, is also a tacit election on the Brexit process itself. If the Lib Dems did the unthinkable and gained north of 60 seats, with minimal Labour losses, the UK could very well have a crisis about the declaration of article 50 itself. More realistically however, the end of a conservative majority would likely lead to the UK seeking to remain as a member of the Single Market. Such a move would send political shockwaves through the UK and EU political system (assuming the EU even allowed it) and would leave the UK bitterly divided, in a far more dramatic way than it has been since the vote itself. Still, the election is the last chance that the British public will have to go out and vote on what relationship the UK will have with the EU.

If you haven’t registered to vote, then go out and do so. This may be one of the defining moments of British politics in the 21st century.

A few words at the end of 2016

It is easy as a commentator on events to assume that we have a unique perspective or insight that people will benefit from reading. After all, if we didn’t believe our opinions were of interest we would hardly be sharing them. But what is often forgotten when we write pieces is the reader themselves. It is easy to fixate on the issues which we are passionate about, to analyse every scrap of detail under the most forensic microscopes we are able to acquire and to wax lyrical on the importance of the issue we are discussing. What it is harder to do is to create something that is relevant, that is interesting, that is inspiring and that is thought provoking. It is for this reason that the default subject of articles often becomes current events and specifically critiques of current politics, people and passions. But while this may be easy and often immensely enjoyable for the writer, it often leaves the readers despondent, overwhelmed and occasionally depressed.

It is partly for these reasons why I think that people have found 2016 such a challenging year. As our world develops increasing ways to communicate with each other faster and in greater detail, it becomes easy to get lost in the noise. In fact, part of what has made 2016 so difficult is how ingrained our habits of checking social media and our phone have become. Instead of using communication to supplement our lives, it has increasingly taken over our lives. Try for a week to count how many meals or meetings you attend where attendees place their phone on the table before the event has even started and consider how many would have done so 10 years ago. It may well be understandable in the context of the world we live in today, but the fact that it has become understandable and that our obsession with constantly accessing information has become rationalised, is also part of the problem. It is important to know what is happening in the world and to know what is happening in our communities, but what people have forgotten is that life moves on regardless. There are no shortage of years where American’s have elected a president, convinced that the electoral system has failed and the candidate will be a disaster, nor are there a shortage of events where major referendums have been forecast to doom entire nations. But these events, while seemingly seismic in nature, often fade quickly into the background for most people, with the challenges they create becoming quickly assimilated into most people’s daily routines.

At the end of 2016 many people are still lost in the noise of Brexit, Trump, Paris, Berlin, Aleppo, Prince and the scores of other events that have left markers this year. But what we shouldn’t lose sight of is the fact that slowly but surely, changes have been happening in the world that are making it better too. At the end of this year the world will have made its first real commitment to keeping carbon emissions below 2 degrees centigrade and the world will have invested more in installing new energy from renewable sources than fossil fuels (the first time since before the industrial era). The world also will have seen the largest single philanthropic endowment of over $100bn from wealthy individuals to fight climate change.

On gender, the proportion of women in finance, notably venture and private equity, will have more than doubled in the last decade. Women’s sport numbers continue to rise, with over 700 million people watching the women’s world cup last year and in the armed services, women will be seen in more active combat roles than at any time in modern history. In politics, the UK has its second ever female Prime Minister, alongside a female German Chancellor and 22 other female world leaders, the highest number in recorded history. On race, we have had the first ever black president of the United States and the UK has its first ever Pakistani mayor of London, with Romania almost electing a Muslim PM for the first time in the country’s history.

On poverty, world poverty and world extreme poverty continue to decline, as does access to energy and access to medication. Technology is also changing people’s lives in profound ways that we take for granted in the west. For the first time this year, Burma has been able to store anti-snake venom across the countryside thanks to renewable technologies and energy storage, a vital innovation in a country with the world’s highest number of snake related fatalities (1.4 per 100,000 people). We also now have developed a cure for ebola and drugs that allow individuals with HIV to have sex without protection, with no risk of passing the disease onto their partners.

There are certainly many more such stories. Perhaps only small and incremental in many cases, but cumulatively they are changing our world for the better. But we risk forgetting about these changes, or even worse, ignoring these advances, if instead of carrying on with our lives we instead fixate on the few issues that constantly catch the headlines.

So at the end of 2016 and the start of the new year we should all consider a piece of advice from older British history, a piece of advice now seen across the world, “Keep Calm and Carry on”. It may not be glamourous and it is certainly clichéd, but during the Blitz in Britain people carried on with their lives regardless of the perilous and fluid environment around them. People knew that major events were unfolding, but they also recognised that the main determinant of their own lives were not the actions of governments but the decisions they took themselves as individuals. That message is one I want share again for the new year’s.

The world is scary and chaotic, but we as individuals determine what role that will play in our lives. So, enjoy your drinks at New Years, the potential hangovers the next day and remember in 2017, whenever you feel overwhelmed, that life still moves on even when your social media is exploding. And when it is, try turning off your phone!

Happy New Years all!

The Case for BREXIT

The starting gun has been fired and now begins the race. By the end of June 2016, the UK will have made the most important decision it has faced in 25 years. Do we stay or do we go?

The BREXIT debate is one of identity, and it is on this issue that the referendum must deliver a clear answer. The question of Britain’s role and place in Europe has always been defined by this question: are we Europeans or are we something different?

Many misunderstand this notion. To say you are different makes people uncomfortable. In this context, it inspires claims either that British people are exhibiting national chauvinism or that they are being willfully ignorant of the realities of today’s world. These claims, however natural they may be given the appalling narrative on immigration in Britain today, are wrong. Britain is different not because we do not share with other Europeans the common bonds of humanity, shared love and respect for liberty and human decency, respect and tolerance of others and a commitment to helping those in need. We are different because we do not believe, nor do we accept, that Europe’s methods of how to build a society are the right ones.

Most would like this vote to be about a simpler issue. The “vote leave” seeks a migration narrative, the “vote stay” wants an economic narrative. But for the future of Britain, they must both fail in their endeavours. Instead, voters should understand the clear meaning of their actions. To “vote stay” means that British people must finally accept that they have a shared responsibility to working with Europeans to help solve their problems as well as our own. To “vote leave” requires British people to acknowledge that if we do not feel a responsibility to help Europeans outside of our national interest, then we must acknowledge simultaneously that Europe has no responsibilities to support our national interest.

In the narrative of history, we must all hope that the story of Europe continues. The European Union has made life better for the continent and its people. It is a symbol of hope and idealism to many across the world, despite all its failings. But it is not our story. I believe in BREXIT because in viewing my home and those from it, I see the world differently from those on the continent. Our nation is not afraid of no longer being a titan on the world stage, nor are we afraid of a world where we do not control the global agenda. Britain has always thrived on its ability to innovate, to be pragmatic and to take risks in order to survive. Such has always been the necessity of island nations.

Europeans see the EU as a mechanism to sit at the world table in the rising new world order. As an equal to China, the US and to India. Today’s modern Britain does not see that necessity. The reality of the modern world is that no nation, or body of nations, can unilaterally determine their economic environment or their security environment. The age of autarky and isolationism is dead. The challenge of our time is not do we choose to work with others, but how we choose to do so. In this context, one must always remember that national interests reflect national character.

The UK does not believe that protectionist trade tariffs, strict labour laws, state controlled economies or heavy state regulation leads to a greater quality of life for our people. The history of our nation shows that our prosperity has been driven by the periods where we innovate, where we seek out new ideas and where we search the world for new markets. The wealth of our nation similarly should never be dependant on one single trading block. It is often forgotten that before the European Union the UK’s biggest trading market was India. Why it is that such a pattern could not re-emerge is one of many unanswered questions that the “Vote stay” movement has yet to address.

The security of our nation has been achieved through the strength of our national endeavours. No foreign-armed force has landed on the British islands in over 300 years and when left alone to defend our citizens rights abroad, we have shown our ability to act unilaterally to protect them. Many mistakenly associate peace in Europe with the European Union. This is wrong. Peace in Europe has been achieved by NATO and de-facto by America. The “Special relationship”, for all its failings, has always been the recognition by Britain that Europe lacks the motivation internally to unite collectively in its own self-defence. If evidence of that were ever needed, the use of NATO in the Balkans and the European reliance on new US armoured brigades in Eastern Europe, provide two immediate examples (there are of course others). The Freedom of our nation therefore will always rely, first and foremost, on our own efforts and our relationship with the US. As to threats of terrorism and transnational crime, it is often forgotten that the UK’s worst period of terrorism came during the “Troubles” in Northern Ireland. If at the height of the cold war our allies were unwilling to help us when it conflicted with their national interest, it seems disingenuous (to say the least) that this will change in the future.

The challenge facing those who campaign to leave has been to explain “what comes next”. Setting aside the unchallenged assumption that staying in Europe will ensure that the UK follows a clear and predictable path for 20 years, it is not unreasonable to say that a vote to leave also requires a plan on how to leave and what should happen after we leave. As with all well laid plans, few survive contact with reality. Assumptions of behaviour and of processes are notoriously challenging even where precedents exist, let alone where they do not. But setting these aspects aside, a strategy for the UK would go as follows.

Following a vote to leave the UK will not immediately leave the EU. This is the reality and yet it appears often ignored. The UK will enter into a period of negotiation on the terms of our exit, while remaining in the Union. The negotiations are likely to require 4-5 years and, in essence, they will require the UK to accept EU governance for its companies who wish to trade in Europe. Conversely, European firms who wish to trade in the UK will have to follow English laws and governance. As most global regulation is increasingly being harmonised, over time there will remain few significant differences in regulation between the two. On immigration, the UK will move to a points based system. In so doing, it will significantly ease work and residency related visa requirements for Australian, New Zealand, US and Canadian nationals. Over time, these restrictions are likely to be expanded to other commonwealth states as their levels of development increasingly reach parity with our own.

From a trade perspective, we will work with the WTO to expand its effort for a new set of global standards and a reduction in global trade restrictions. We will also explore deals with ASEAN and other regional markets across the world. Such action was how we once thrived. We will re-discover this talent, as many of our young entrepreneurs already are doing.

At the International level, the UK will continue to sit and act in partnership with European nations. We will join with Canada, Australia, Norway, Switzerland, Turkey, New Zealand (and occasional the USA and Japan) as part of the EU+ grouping which exists within the major multilateral banks and other international organisations. On security matters, we will remain committed to the defence of Europe and particularly Eastern Europe, where we have already increased our presence and where we played an instrumental role in bringing these nations into both the EU and NATO. For issues of transnational crime, a bilateral extradition agreement will be made with the EU as part of our terms of exit. On this last matter, there is little disagreement between the EU and the UK and little incentive from either party to prevent such an outcome.

This is the case for BREXIT. A UK that remains a friend and partner of Europe, whilst remaining an independent nation state that pursues the best interests of its people on its own terms. To “Vote leave” is not a rejection of liberal values and a statement of disregard for the well-being of Europeans. Instead, it is a re-assertion of the well known principle that the best form of governance is self-governance. It is time British people remembered this principle.

To my countrymen and women, whatever your opinion, please make sure that you vote on 23rd June. This is our future and I hope you vote to leave with me.

The World needs more passionate people – are you living yours?

Dreams. We all have them. Fleeting thoughts and moments of transcendence where the constraints of the world we face are gone and our minds, free of constraints, expand and search outside the realm of possibilities for a place, a vision, where we feel an affinity. Maybe it feels like you have never had one right about now. Hell, maybe it feels like you haven’t had one for a very, very long time. But dreams are a home for the mind to explore its limits and to challenge its notions of what is and what could be. At least to my mind, dreams are a gateway to our souls.

I believe that the world I see is full of dreamers. People with passions so diverse and so fantastical, that to fathom what could exist if these were truly pursued to their fullest extent, is beyond the wildest imaginations of the most eloquent creators of fables and fictions.

However, what concerns me in this world is how quickly these passions – so pure and so powerful -become buried by the passage of time. The burden of doubt, sic insecurity, the fear of failure and the desperate craving of some degree of security.

It seems as though we are the generation which simultaneously cannot fail, and yet are so constrained by the fears and concerns of our own human frailties that we are inevitably destined to fall short of our aspirations.

This needs to change. This fear of not reaching the “undefined” end game is a barrier that we find ourselves up against again and again. Especially when we consign our desires to the bin and opt for the warm embrace of a certain “safe” outcome.

To value security and to desire a comfortable life is no crime. Nor am I trying to suggest that people whose circumstances are extremely challenging have “given up” on their dreams due to a lack of ambition or even worse: courage. There are perhaps fewer cruelties in life than seeing your dreams taken from you by the circumstances of your environment.

I acknowledge fully that I have been gifted good fortune well beyond what is “fair” or “reasonable”, so perhaps for many this piece of prose is nothing more than the musings of an over indulgent young idealist. Perhaps that is so.

But to my mind, to witness passion in people is to observe what happens when dreams transcend from the realm of constraints that we ourselves impose upon our conscience. To embrace a moment of passion is to explore ones desire to explore and to understand that which makes us feel at once in comfort and in an instance filled with trepidation.

If there was never a reason for us to be here and to be given this chance this place, this right to make a life for ourselves and to set out our stall on the stage of the heavens and determine the play of our lives for the audience in the stars afar. Then let us be sure that our stories, the stories of those we live and the stories of everyone who has been given a chance and a right to build their own futures and tell their own fables, will leave the stage with their heads held high and the knowledge that they gave the world the show that truly moved them.

If we are but creatures of destiny, then let our destinies shine so brightly that they glow for all to see. In the darkest corners and the cruellest hours of sombre days, it is the sparkle of light from those valiant few whose radiance gives warmth and stir to those in need. It is in their being, their glowing, their smiles and their harmonies that we are stirred from within by forces from that many had thought were lost, or so irretrievable that their very past existence had become questionable.

Our world is nothing without these moments. These brief sojourns from the relentlessly ticking clock of the days fading moments.

Our passions and desires are what make us human and make our lives worth living. I admire all my friends and those in my family who I see aspiring to achieve their dreams.

I hope that more people find and follow their dreams too.

An Alternative Energy Reality – viewing Europe from a Greener 2030

At first the stock-analysts and fund managers had brushed aside reports that the traditional energy giants of the 20th century were due for a heavy fall.

It seemed like an act of sheer lunacy to consider that overnight the value of the world’s leading multinationals could fall by over 40%, then continue to decline. But with the declaration of a “Global Carbon Cap” and the Energy revolution from Europe in the early 2020’s, the giants of old had discovered they could no longer rely on their “booked reserves” to bolster their stock price, and soon their seemingly impregnable balance sheets melted away like the ice caps had before them.

It all started, strangely enough, in Europe. An area that many had thought may have lost its lustre for innovation.

Caught in the midst of a two-pronged geopolitical storm, between an expansive Russian foreign policy, (which used Energy supply as a foreign policy weapon) and an expanding Middle Eastern conflict, the instability from which had created significant threats to global energy supplies, European nations were forced to seek out new technologies to achieve greater energy independence and economic security.

For many years Renewable Energy had been seen as “fashionable” but dismissed by many as an impractical to the problem of Europe’s energy future. It could not be stored (at commercial cost or commercial scale), it was inefficient in its generation (Offshore Wind lagged well behind its fossil Fuel Combined Cycle cousins) and it caused political headaches to locate many commercial scale renewable projects in close proximity to where energy was needed (i.e. population centers). Then things began to shift.

In the UK companies such as Flexitricity began an initiative to swap diesel powered back-up generators on commercial premises with battery storage units. Most firms had invested significant sums into “contingency plan” energy storage capabilities. But these “back-up generators” were often expensive, rarely used and relied predominantly on diesel (and other petroleum substitutes). Replacing these units with Energy Storage units created significant cost savings for these firms and played a significant role in reducing the total costs of these organisations.

As a provider of virtual Smart Grid technology, Flexitricity and other UK innovators in the field convinced firms that they could achieve the wholly trinity of: enhancing their green credentials, ensuring a robust back-up power source for the premises and the ability to make money from their generators (which hitherto had been sunk costs).

The surge in locally available domestic energy storage capacity provided a boom for local communities, who realised that these new electricity storage units could provide spare capacity to store surplus energy from domestically generated renewable sources. These individuals and communities, through using “smart-grid” software providers and the new generation of electricity traders, were able to store  their surplus electricity and release it for sale into the national grid system at peak times, when prices were at their highest. This not only made domestically generated renewable energy more cost effective (in some cases very profitable), but it also made national energy systems more resilient as the UK grid relied increasingly on 10’s of 1000’s of providers rather than under 100.

Following a series of innovations in the production of solar panels, the public sector gradually understood that with the large tracts of land at its disposal, it could produce vast quantities of energy and store it domestically at low cost.

The first public sector concepts involved grand projects for 30+MW sites, but were slow to catch on and implement. However the public sector soon realised that areas such as roads could be turned into giant energy generators during the process of routine road maintenance, whilst following the example of the Scandinavian, the Public Sector in the UK also became more open to the concept of district heating systems. This in turn became a public sector alternative to energy storage through local battery units, thus further reducing costs.

However alongside innovations in the production and storage in energy came the revolution in the demand and consumption of Energy. With fuel prices becoming increasingly sensitive for European families in the 2010’s, Smart meter systems were rapidly deployed across the UK and major European economies, driven by a 2022 EU competition commission ruling that “consumers at all times must have the right to determine the exact levels of energy which they choose to consume; and if consumers are unable to identify their consumption level; or it is unclear; it is the obligation of the firm(s) to disclose this information to the end consumer at minimal inconvenience.” The leader in this field of energy consumption knowledge sharing was a product called “Hive”.

Launched by British Gas in the early 2010’s, it played a significant role in adapting consumers behaviour and their awareness of individual/household energy consumption. These changes led to huge increases in efficient energy usage amongst households and corresponding declines in both net Energy consumption. Furthermore, the peaks and troughs of energy demand in the UK system became less pronounced, as consumers increasingly utilized their high energy demand activities (e.g. washing machines) at traditionally “off-peak” hours, thus smoothing out the consumption curve.

Where the UK led, others in Europe followed.

As European demand for energy fell and domestically sourced energy became more reliable and cost competitive, it provided a boom for the fledgling 3D printing industry across Europe. With its rich heritage of “artisan designers” and its discerning consumer market, the combination of low energy prices and technological innovation generated a boom in “bespoke” manufacturing across all sectors of the European economy which helped significantly reduce unemployment across the continent. The continents trade deficit with the world also declined and traditional export dominated markets, who had seen Europe as a key market, became increasingly concerned and uncertain of their strategies.

But the turning point for Europe came with a crucial technological innovation, that allowed the conversion of Renewable Energy into an energy sources for which Europe was already well developed to exploit. Gas – or rather – Hydrogen gas.

In 2015 a UK company called ITM power began piloting projects alongside the German utility powerhouse “RWE” to demonstrate its technology that converted excess renewable energy into Hydrogen fuel cells or Hydrogen gas. This innovation was a game-changer for Europe, which allowed natural gas to be gradually phased out in favour of Hydrogen gas and which accelerated the rapid growth of European wide Hydrogen and Electric powered transport systems.

Working alongside idealistic challenger energy utilities like ecotricity, ITM’s technology and innovations in energy storage allowed the UK to complete a nationwide renewable transportation re-fueling network. Not only did this dramatically reduce the UK’s air pollution, it also had significant effects on the health of its citizens and bio-diversity of its landscape. Such rapid success immediately spawned copy-cats and rival innovators from across Europe and the world economy writ large.

In 2030 it seems bizarre to imagine how “natural gas” and “fracking for shale gas” could possibly have been the future, but it is always worth remembering that only where ideas and innovation thrive has mankind developed. It was fortuitous that the leaders of the developed world created and maintained an innovative environment in 2015. But it might not have taken much for history to have developed rather differently.

Why going Green is no longer the best choice for the global future of energy, it is the only choice.

The American Shale story is a myth. Well, maybe a myth is strong, but the story of Shale in the US is certainly not what it seems.

For one, this was never anything new. Fracking, or hydraulic fracturing, is over 60 years old in the United States and has occurred in over 1 million conventional Oil & Gas wells during that time. It’s not just the US though. In fact the UK has been hydraulically fracturing for over 30 years as well, including in areas of outstanding natural beauty, with barely a squeak of publicity until documentaries like “Gasland” in the US.

Next, the “discovery” that Shale contains large quantities of oil & gas isn’t new either. In fact it’s been known for a very long time but what is new is figuring out how to get it out of the ground commercially. I repeat: commercially.

So what? Why does this matter and why does this make the US Shale story “a myth”.

Firstly Shale gas is a loss making enterprise. In fact, the only money that is profitable in the vast majority of US Shale plays is where they are after Oil. Not gas. The write downs by Shell and BHP Billiton on their Shale concessions in 2013 were just the start of what’s coming, but the sale of prime real estate by Chesapeake energy to avoid liquidation is one of the best pieces of evidence that the gas these companies are extracting is a loss making endeavour.

The next issue is that Shale gas is already requiring more land rigs than the rest of the world’s rotary rig fleet combined simply to cover the US declines in conventional gas production and this is the real story: US gas fields are ageing with no obvious replacements while demand from domestic consumers and industry is growing. Furthermore the pace of decline is rapid and only the staggering level of capital investment in Shale extraction in the US will delay this process.

The US Shale “phenomenon” in short has been driven by two critical and correlating factors – large domestic demand for energy and a lack of significant import or export capability for natural gas. The lack of a natural gas market of the scale and interconnectivity of the Oil market is a key element in this, reducing the natural market forces which would have made the notion of US gas prices below $4 per MMBtu against over $12 per MMBtu in Japan, unfathomable.

In short, forget US “Energy independence”, the US will be importing again in less than 10 years and countries like Iran, Iraq, Nigeria and Mozambique are part of the reason why.

Conventional natural gas is actually very cheap in many places in the world, in part as it has no natural market in many economies where it can be produced in (hence why Nigeria has been estimated to flare over $2.5 Billion of potential gas revenues every year). But more importantly, natural gas can be very cheap to produce but it is expensive to store and transport unless the economies of scale grow enough to bring those costs down. Enter Europe, with LNG Terminal import capacity that is large enough to add another Norway of gas to Europe on a fleet of new LNG vessels, currently in hot demand from Asian yards (and conveniently mostly European owned too).

This injection of demand into Global LNG will accelerate the economies of scale required for natural gas to expand into a truly international trade and help to reduce the need for long term locked-in prices, thus allowing countries to purchase gas more on the spot market. Thus declining gas prices will not be an issue for gas producers sitting on fields like South Pars in Iran (estimated as the world’s largest natural gas field), where the well can be capped for a period if prices are atrocious. It is and will however be a major issue for any shale company that will be require to drill repeatedly and regularly to stimulate the well concessions they have that are producing shale gas/oil, at a cost of between $4-8 million per well to drill.

Taking aside this soon to be regained advantage of natural gas productionagainst the distorted US Shale gas market however, the simpler problem is that continued investment into resource extraction is not a smart long term investment.

The scope of global renewable potential presents a range of fantastic options for a smart grid system, with integrated battery technology helping to stabilise the variable power production levels of renewable energy sources while reducing the barriers to entry for new energy companies. This model also increases system survivability by diversifying the power production sources so that a natural, man-made or terrorist action against a piece of energy infrastructure is less dramatic that it is currently.

This infrastructure therefore is not only a national investment into systems that will last well over 20 years, but also into advanced technology which provides solutions for providing energy to a highly diverse range of consumers. From the military applications, to off-grid settlements, mega cities and small towns – renewable energy integrated into a smart grid system with battery capability is scalable to any level.

Thus Shale gas will not and cannot be the long term answer to the US and the world’s energy challenges. Rather, it is an artificially stimulated hiccup in the broader gas and oil production landscape.

Many energy pundits have been quick to label this century “the Gas Century” and for now they are right, but for our future they need to be proven wrong. There may well be vast stores of gas whether conventionally or Unconventionally (Shale, Coal Bed Methane, Methane Hydrates), but this is not a future for our world either economically, ecologically or politically.

It’s hard to see what needs to be happen for people to join the dots and make the integrated smart grids which the technology of today is so close to being ready to deliver, but my bet for where it may happen first would be to look in unexpected places: I particularly liked this photo from rural Myanmar as a sign of encouragement for the future, so feel free to share on: Image