ENERGY TRANSITION TOWARD RENEWABLES … · World energy consumption mostly comes from fossil fuels. Tackling climate change implies to emit less GHG. Energy efficiency and …

ENERGY TRANSITION TOWARD RENEWABLES AND

METAL DEPLETION: AN APPROACH THROUGH THE

EROI CONCEPT

Florian FIZAINE* et Victor COURT**

*LEDi - Laboratoire d'Économie de Dijon - UMR 6307 - Université de Bourgogne, Email : [email protected]

**EconomiX - UMR 7235 - Université Paris Ouest, Nanterre - La Défense, Email : [email protected]

Seminar of presentation of student’s papers

Annual French AEE Conference, 24-25 November, 2014

Outline

I. Introduction and context

II. Empirical observations

III. Methodology

IV. Results

V. Discussion

VI. Conclusion

2

I. Introduction and context (1/3)

For many researchers (Stern and Kander (Energy Journal, 2012); Ayres

and Voudouris (Energy Policy, 2014)) economic growth depends mostly

on three productive factors: labor, capital and energy.

Far from being perfect substitutes, these factors are probably

complementary which implies for these same authors that GDP

growth is mainly driven by energy consumption growth.

World energy consumption mostly comes from fossil fuels.

Tackling climate change implies to emit less GHG.

Energy efficiency and renewable energy technologies appear as the best

solutions to adress both problems at the same time.

3

I. Introduction and context (2/3)

Source: Ashby (2013)

4

I. Introduction and context (3/3)

Limited research has been done on the dynamic between energy and metal sectors (Harmsen et al., 2013).

Extracting metals comes at an energy cost.

Despite technological progress, increasing energy cost of extraction is a consequence of ore grade degradation associated with metal depletion.

This necessarily impacts the ability of an energy system to deliver net energy.

Research question: How is metal ore grade evolution affecting the EROI of renewable technologies ?

5

II. Empirical observations (1/3)

Our calculations show that 10% of global primary energy is consumed by the metal sector.

Difficult to generalize the counter calculation, although Bihouix and De Guillebon (2010) have estimated that 5 to 10% of steel production is used by the energy sector.

Data from the IEA are interesting to observe such dynamic aspects.

6

Evolution of the final energy consumption of different sectors (based 100

in 1973). Source: IEA, 2014.

II. Empirical observations (2/3)

Ore grade degradation is observable at different levels: deposit (Crowson,

2012), country (Mudd, 2010) and world(Crowson, 2012 ; Schodde, 2010).

Source : Crowson (2012)

7

II. Empirical observations (2/3)

Source : Schodde (2010)

8

Ore grade degradation is observable at different levels: deposit (Crowson,

2012), country (Mudd, 2010) and world(Crowson, 2012 ; Schodde, 2010).

II. Empirical observations (3/3)

We have extended the work

of Norgate and Jahanshahi

(2010) in order to determine

an econometric relation

between ore grade (X) and

energy cost of extraction (Y).

Y = 279.25*X-α

With best estimate for α=-

0.6OO26 and a 95%

confidence interval of (-

0.418609; -0.781910)

9

y = 279.25*X-0.6 R² = 0.58606

y = 77.585*X-0.857 R² = 0.99603

1,000

10,000

100,000

1000,000

10000,000

100000,000

1000000,000

0,0001 0,0010 0,0100 0,1000 1,0000 10,0000 100,0000

Ene

rgy

con

sum

pti

on

fo

r o

ne

me

tric

to

n (

GJ/

t)

Minimum ore grade

Calibrated on 34 metals Norgate and Jahanshahi (2010)

The Energy Return On Investment (EROI) is a pertinent indicator of the accessibility of the energy:

Energy Out:

Energy extracted from the

environment Energy In:

Direct and indirect energy

invested in the energy system

Some facts

Fossil fuels present declining EROI with maximum EROI already passed (Hall

et al., 2014).

Renewable technologies have very different EROI: from 2 in the case of

biofuels, to 20 for wind power and value superior to 50 for hydropower

installations.

In each technology, metals account for a specific share of the energy

invested

10

III. Methodology: EROI concept

11

III. Methodology: Equations (1/2)

12

III. Methodology: Equations (2/2)

13

III. Methodology: Assumptions

14

IV. Results: EROI sensibility to copper ore grade

degradation (general vs. specific relation)

0

10

20

30

40

50

60

0

5

10

15

20

25

0,001% 0,010% 0,100% 1,000% 10,000%

Hydro EROI Other EROI

Grade of copper

Parabolic Trough

Solar Tower Plant

PV Single Si

PV Multi Si

PV a Si

PV CIGS

PV CdTe

Onshore Wind Power

Offshore Wind Power

Nuclear Power (PWR)

Hydropower

Sensibility of the EROI of different energy

technologies to the grade of copper

specific copper relationship:

consumption=1.397*grade^-0.857

Sensibility of the EROI of different energy

technologies to the grade of copper

general econometric relationship :

consumption=5.446*grade^-0.60026

0

10

20

30

40

50

60

0

5

10

15

20

25

0,001% 0,010% 0,100% 1,000% 10,000%

Hydro

EROI

Other

EROI

Grade of copper

Parabolic Trough

Solar Tower Plant

PV Single Si

PV Multi Si

PV a Si

PV CIGS

PV CdTe

Onshore Wind Power

Offshore Wind Power

Nuclear Power (PWR)

Hydropower

15

IV. Results: EROI sensibility to nickel and

chromium ore grade degradation

Sensibility of the EROI of different energy

technologies to the grade of nickel

specific copper relationship:

consumption=11.463*grade^-0.60026

Sensibility of the EROI of different energy

technologies to the grade of chromium

general econometric relationship :

consumption=26.529*grade^-0.60026

0

10

20

30

40

50

60

0

5

10

15

20

25

0,001% 0,010% 0,100% 1,000%

Hydro

EROI

Other

EROI

Grade of nickel

Parabolic Trough

Solar Tower Plant

PV Single Si

PV Multi Si

PV a Si

PV CIGS

PV CdTe

Onshore Wind Power

Offshore Wind Power

Nuclear Power (PWR)

Hydropower

0

10

20

30

40

50

60

0

5

10

15

20

25

0,001% 0,010% 0,100% 1,000% 10,000%

Hydro

EROI

Other

EROI

Grade of Chromium

Parabolic Trough

Solar Tower Plant

PV Single Si

PV Multi Si

PV a Si

PV CIGS

PV CdTe

Onshore Wind Power

Offshore Wind Power

Nuclear Power (PWR)

Hydropower

16

IV. Results: EROI general sensibility to the

depletion of all metals

Evolution of the EROI of different energy

technologies to a similar degradation (θ) of the

grade of all geochemically rare metals. A multiple

of the current grade of 0.1 means that current

grades of all geochemically rare metals are divided

by a factor of 10.

Relationship: μ=θα, where α=0.60026

Relationship: μ=θα, where α=0.781910

0

10

20

30

40

50

60

0

5

10

15

20

25

0,001 0,01 0,1 1

Hydro

EROI

Other

EROI

Multiple of the current grade

Parabolic Trough

Solar Tower Plant

PV Single Si

PV Multi Si

PV a Si

PV CIGS

PV CdTe

Onshore Wind Power

Offshore Wind Power

Nuclear Power (PWR)

Hydropower

0

10

20

30

40

50

60

0

5

10

15

20

25

0,001 0,01 0,1 1

Hydro

EROI

Other

EROI

Multiple of the current grade

Parabolic Trough

Solar Tower Plant

PV Single Si

PV Multi Si

PV a Si

PV CIGS

PV CdTe

Onshore Wind Power

Offshore Wind Power

Nuclear Power (PWR)

Hydropower

17

V. Discussion

18

V. Discussion

Enhancing effects not taken into account The « Mineralogical Barrier » of B.J Skinner (1976)

Further decreasing return in future deposits: deeper, more impurities. (UNEP, 2013)

Consideration of other externalities: environmental impacts from waste management, water need, GHG emissions, etc.

Energy cost associated with the construction and maintenance of other parts of the energy system: grid, storage systems. (Harmsen et al.)

Mitigating effects not taken into account Recycling

Decreasing material intensity of technologies

Energy efficiency gains

Technical substitution of rare metals with common metals

Energy economies of scope through coproduction

Energy economies of scale

VI. Conclusion

19

Focusing on « quality depletion » is even more important than

« quantity depletion ».

Inter-sectoral approach is helpful to apprehend complex problems

without reporting issues on others sectors.

The energy transition as we conceptualize it nowadays may not lead

us to energy sustainaility as we would report the depletion problem

from fossil fuels to metals (in particular « geologicaly rare metals »).

Even if technological progress will be effective in some areas, a

simpler answer might be to bring some rationality in our way of life.

20

Thank you for your attention

Appendix: metal intensity

21

Parabolic trough

Solar tower plant

PV single si

PV multi si PV a Si

PV CIGS PV CdTe

Onshore wind Offshore wind

0

1

2

3

4

5

6

Cad

miu

m

Ch

rom

ium

Co

pp

er

Gal

ium

Ind

ium

Lead

Mo

lyb

den

um

Nic

kel

Nio

biu

m

Sele

niu

m

Silv

er

Telu

riu

m

Tin

Van

adiu

m

Zin

c

Pra

seo

dym

ium

Neo

dym

ium

Terb

ium

Dys

pro

siu

m

Metal intensity (t/MW)

Appendix: Pourquoi une approche par l’énergie ?

Il existe principalement deux approches pour mesurer l’épuisement : l’approche

monétaire de l’école néoclassique et l’approche énergétique de l’école biophysique.

Les prix de marché des énergies souffrent d’un certain nombre d’inconvénients (Hall et al.,

2009) :

Les prix sont influencés par des variables et des conditions actuelles (géopolitiques,

politiques économiques, monétaires, taux de change…) indépendantes du niveau

d’épuisement.

Ils n’intègrent pas les externalités et incorporent la plupart du temps des biais dus aux

subventions.

Leur extrême volatilité en font des indicateurs de très faible qualité pour anticiper l’avenir.

S’ajoute aussi l’ensemble des problèmes de mesures temporelles et spatiales de la monnaie

(choix du déflateur, biais divers…).

C’est pourquoi nous optons pour une approche énergétique de la valeur.

22

Appendix: theoric minimum energy

23

Source : World Steel Association

Source : US DOE (2007)

Minimum énergétique théorique

5,99 kWh/kg

Minimum énergétique théorique

5,37 M BTU/tonne

24

Appendix: econometric table

25

Appendix: Clark Value vs. Energy Factor

y = x0.6

y = x0.857

0

500

1000

1500

2000

2500

3000

0 1000 2000 3000 4000 5000 6000 7000 8000 9000 10000

Mu

ltip

lyin

g fa

cto

r af

fect

ing

un

itar

y e

ne

rgy

con

sum

pti

on

Clarke Value

Calibrated on 34 metals Calibrated on data of Norgate and Jahanshahi (2010)

26

Appendix: Grades and Reserves

27

Appendix: equations in general case

Appendix :Effect of recycling

28

0

1

2

3

4

5

6

7

8

9

10

11

12

13

14

0,00001% 0,00010% 0,00100% 0,01000% 0,10000% 1,00000% 10,00000% 100,00000%

ER

OI

Ore grade for copper (primary production)

Recycling content = 0% Recycling Content 50%

Recycling Content = 30% Recycling Content Content 99%

Technology: PV CadTe, Exhaustion of copper

Recycling Content:

Quantity of secondary copper in

the total flow of copper required

Different from end of life recycling

rate

Appendix: EROI vs. Energy price

29

Relation entre le EROI et le prix de marché de l’énergie

0

50

100

150

200

250

300

350

400

450

500

0 5 10 15 20 25 30

Pri

x $

2010/b

ari

l

EROI

Heun et De Wit (2012)

King et al (2011)