2012 April 29

Backfilling Nuclear Shutdowns With Efficiency And Renewables In Japan, Germany And California?

by James Newcomb, via the Rocky Mountain Institute

Electric utilities and policymakers in Japan and Germany have been scrambling for months to find ways to compensate for nuclear power plants shut down in the aftermath of Fukushima.

In both instances, fossil fuels are part of the stopgap solution to offset the declines in nuclear generation in the short term, but longer-term energy policies are shifting definitively toward efficiency and renewables. Now, the unexpected and indefinite shutdown of both units at the San Onofre Nuclear Generating Station in Southern California has raised questions about California’s short-term electricity supply options and long-term contingency plans.

Not surprisingly, efficiency, demand response, and renewables could play a key role in helping to diversify and mitigate risks for Southern California’s electricity supply future. The solutions being pioneered in these three markets, while driven by different circumstances, all take advantage new smart grid technologies to manage and integrate distributed resources.

In Japan, only one of the 54 commercial nuclear reactors that supplied 30 percent of the nation’s electric power prior to the Fukushima disaster is currently operating. It, too, is scheduled to shut down for scheduled maintenance on May 5, leaving the country with no power supplies from nuclear plants for the first time in more than four decades.

Japan’s central government is now seeking to win agreement from local authorities in Fukui prefecture to restart two nuclear reactors operated by Kansai Electric Power Co., but whether and when these reactors might actually be allowed restart remains uncertain.

These unprecedented circumstances raise the possibility of economically damaging power shortages as demand increases during Japan’s hot summer months. Kansai Electric, which depended on nuclear for 49 percent of its generating capacity, has warned that its power supply capacity could fall short of peak demand by as much as 18 percent this summer if none of its reactors are allowed to restart. And while Kansai’s service territory is geographically small, its annual economic output is worth more than $1 trillion.

The principal short-term solutions to the crisis have been emergency demand curtailments and heavy use of imported oil and natural gas in existing thermal power plants, a major factor behind Japan’s trade deficit in fiscal 2011, the first in more than three decades. The International Energy Agency projects that in 2012 Japan’s electric utilities will burn 300,000 barrels per day more oil and 23 billion cubic meters more liquefied natural gas to make up the generation deficit if none of the shut down nuclear reactors is allowed to restart.

The upshot of these events is an intensified focus on energy efficiency and renewables, two solutions that hold promise of bridging the supply-demand gap in the years ahead while simultaneously reducing the current heavy reliance on fossil fueled generation. Under its pre-Fukushima energy policy, Japan had set a goal of increasing renewables from 9 percent of power supply in 2008 to 21 percent by 2030. But an assessment released last year by the Ministry of Environment suggested that Japan could shift even more dramatically toward renewables. Already, major Japanese companies—including Mitsubishi Heavy Industries, Toshiba, Hitachi, and Softbank—have announced plans to build hundreds of megawatts of new solar and wind projects.

At the same time, new investments in smart grid technologies to manage demand and integrate renewable power supplies into the grid are increasing rapidly. Hitachi, Panasonic, Toshiba, Fuji Electric, and Mitsui are among the major companies working to implement new energy management technologies, including pioneering experiments in integrated neighborhood technologies. Accelerated investment in these technologies by Japan’s most powerful technology companies will have global consequences as new products and service models come to market.

Halfway around the world, Germany’s electric power sector is turning to similar solutions in the aftermath of Fukushima. Within months of the Fukushima disaster, Germany revoked the operating licenses of seven of its 17 nuclear power plants and subsequently voted to exit nuclear power altogether by 2022. Germany now plans to get 35 percent of its power from renewables by 2020 and has committed to reaching 80 percent by 2050. The shift to higher shares of variable renewable generation will require parallel investments in efficiency, demand response, and better grid controls to help integrate high levels of variable renewable supplies.

Already, Germany’s largest electric utilities, EON and RWE, are increasing their investments in solar and wind energy to offset nuclear power supplies. Earlier this year, RWE began operating the first commercial scale virtual power plant, weaving together the operations of dozens of green energy sources in order to be able to bid up to 80 megawatts of power supply into the European Power Exchange. The changes already unfolding in Germany foretell the demise of baseload generation, together with increased needs for flexible, dispatchable supply- and demand-side resources.

Do the events in Japan and Germany have relevance to the United States? The answer is yes, and potentially sooner than almost anyone expected. The San Onofre plant is closed because of unusual and excessive wear in hundreds of tubes in the plants’ steam generator units, raising questions about the integrity of the steam generators installed by Southern California Edison (SCE) in 2009 and 2010.

The problems at the plants raise the possibility that California could face power supply challenges this summer not unlike those facing parts of Japan and Germany. San Onofre plays a critical role in Southern California’s electricity grid, so finding short-term solutions will be challenging. California’s policymakers, utilities, and grid operators are hurrying to create contingency plans to reduce demand and ramp up generation from gas-fired power plants and other interim supply sources to meet peak summer demands. Perhaps more importantly, however, even if the problems with San Onofre’s steam generators are overcome, the current troubles could increase the likelihood that SCE will face difficult challenges to relicensing the plant in 2022 for another 20 years of operation. Could efficiency and renewables make up the difference if San Onofre were to go out of service in 2022?

To explore answers to this question, RMI, in collaboration with Energy and Environmental Economics (E3), is studying long-term scenarios for Southern California’s electricity future using models developed on for the California Public Utilities Commission. These scenarios explore pathways to achieve up to 50 percent renewable electricity supply by 2030 with and without nuclear power in the supply mix. Results of the study will be released in June.

James Newcomb is the Program Director for electricity at the Rocky Mountain Institute.

Related Post:

• Germany: Fighting Climate Change And Phasing Out Nuclear Power Are Two Sides Of The Same Coin

Is CoolPlanet Biofuels too good to be true?

Imagine a company that says it can produce virtually limitless amounts of cheap gasoline, create arable land for food production and solve the climate crisis–all at once.

That’s the promise of CoolPlanet BioFuels.

Mike Cheiky, the company’s founder and CEO, spoke about CoolPlanet’s “negative emissions technology” at Brainstorm Green, FORTUNE’s conference about business and the environment. Yes, negative emissions.

Does that mean, I asked him, that the more you drive a car powered by CoolPlanet’s biofuels, the more CO2 will be pulled out of the air? Yes, he replied.

“The world doesn’t have too much carbon,” Cheiky explained. The problem’s is that the carbon’s in the wrong place. There’s too much in the atmosphere, causing global warming,  and not enough in the soil. Essentially, Cool Planet has a plan to use plants to remove it from the air and then restore it to the land.

Before you decide that this is too good to be true, you should know that Cheiky, a veteran entrepreneur, has persuaded Google, General Electric, BP, ConocoPhillips, NRG Energy, Exelon and venture capital firms Shea Ventures and North Bridge Venture Partners to invest millions of dollars–he won’t say how many millions–in CoolPlanet Biofuels.

“We have been poked and prodded so many ways by so many people,” Cheiky told me. “GE sent 17 people to do their due diligence at a time when we had only 15 employees.”

These investors wrote him checks, he added, because of his track record. “I’ve done six start-ups in my career,” he went on, “and I’ve never had a down round. They’ve all been very successful.”

Cheiky does not lack self-confidence. He and his wife, Charity, started Ohio Scientific, one of the world’s first personal computer companies, in 1975, right after he graduated from college. “I was very successful as an early pioneer in the microcomputer era,” he told me. He built an electric car in the early 1990s but subsequently decided that “we would not be able to deploy electric vehicles fast enough to combat climate change.” More recently, Cheiky founded Zinc Matrix Power, which became ZPower, a company that makes small rechargeable silver-zinc batteries for mobile applications. He also started, Transonic Combustion, which aims to dramatically improve the efficiency of the internal combustion engine. Venrock and Khosla Ventures invested in Transonic, and former GM exec Bob Lutz sits on its board. Cheiky is no longer involved in ZPower or Transonic–a sign that he is probably better at starting companies than managing them. He says he left Transonic when he realized that “just making the engines more efficient wasn’t going to do the job. I had to crack the problem of the fuel.”

The concept behind CoolPlanet is simple. Begin with biomass, in the form of wood chips, corn cobs or fast-growing crops like miscanthus. Process it through a bio-fractionator using a proprietary thermal/chemical process. Make gasoline that’s identical to the fuel pumped into your car. Then take a carbon-rich byproduct, a solid biochar, and bury it to sequester carbon or use it to enhance soil. (Here’s a long interview with Mike Rocke, vp of business development at CoolPlanet BioFuels, explaining the process.  I’ve also pasted an explanation from the company website, below.)

Cheiky says that that CoolPlanet Biofuels will be able to make gasoline for $1 a gallon. Yes, $1 a gallon. The company then will deploy biochar to make more land on which more crops can be grown to make more gasoline, and so forth.

He said:

We have a sustainable model. We can power the world, literally, provide all the liquid fuels need for the world, with land that we can create, basically. You’ve got to take carbon out of the atmosphere and put it back into the ground to have more fertile land to grow more food crops and fuel crops at the same time.

In a decade or two, he told me, as the company gets to massive scale, this new way of making fuels could not only destroy OPEC but offset all of the world’s carbon emissions.

Can this  be true? It’s hard to know, because CoolPlanet is a bit of a black box. The company won’t get into the details of its technology, which is understandable; that’s its competitive advantage. Cheiky also won’t say how much money he has raised, which is unusual; most startups are transparent about their financing. He was also a bit vague when asked about how much water will be needed to grow the feedstock crops. Whether biochar can be used to sequester carbon, and for how long, is yet another unanswered question. (See my blogpost, The carbon negative economy)

Yet Cheiky says the company’s technology is already working, albeit on a small scale, near its headquarters in Camarillo, CA. His plan is to build a commercial plant somewhere in the midwest next year. Initially, the plant will probably run on waste products like corn cobs or wood chips, but it can also consume fast-growing plants like miscanthus, switchgrass and sorghum.

“A giant miscanthus can grow 20 feet tall in a season,” Cheiky says. The company said recently that it generated 4,000 gallons of gasoline per acre of biomass  in pilot testing using giant miscanthus.

CoolPlanet Biofuels could be a game-changer — or it could prove to be another disappointment in the biofuels business, which has so far has produced more hype than economic or environmental benefit. Let’s hope that Cheiky is right, and that his company is onto something big.

Here’s how CoolPlanet explains its process:

This breakthrough utilizes mild process conditions, with process temperatures comparable to a kitchen stovetop and maximum pressures comparable to a portable tire inflator. Input biomass is coarsely ground from in field air-dried bioenergy crops with moisture content in the 10-20% range. Many advanced energy crops retain root structure for several years and are simply cut down once a year for harvesting, dramatically reducing the carbon intensity of agricultural activities versus other bio sources such as algae farming or wood clearing, chipping and drying. The total process time from biomass to fuel is under one hour. Total energy and biomass feedstock cost using today’s commodity pricing is under 60 cents/gallon.

And here’s a video of Mike Cheiky talking about the company at a Google event called Solve for <x>:

Car2go Launches Car Sharing in Berlin – Why are the Germans Chuckling?

Daimler brings the flexible short-term rental concept to Berlin with 1000 SmartCars, raising smiles for more than just the pleasure of car sharing.