Top 5: Solar Costs Are Dropping. How Does It Impact Fuels?

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October 29, 2020

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by Tammy Klein (Future Fuel Strategies) ... Items I selected this month include: • Solar Costs Declining Quickly: More quickly than even the IEA has projected. That will have consequences in transport that includes cheaper EV charging, green hydrogen and electrofuels.

Car Bans in the U.S.: Could we see other states follow California? Maybe, especially the Northeast states. A national ban? Not likely.
California’s Grid: To support a ban and transition to electrification, electricity demand is expected to increase in California at least 25%. A lot has to happen in 15 years – not a long time in energy – to make that happen.
JEC Research: Lots of good findings and analyses in this 5^th edition, which includes heavy-duty vehicles (HDVs) for the first time.
Saudi Aramco Takes Another Path: While other oil companies are facing the energy transition, the Saudi Aramco is doubling down. That doesn’t mean the company isn’t planning to reduce its carbon intensity.

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In all four of IEA’s scenarios, renewables demand increases. The IEA’s main scenario (STEPS), which is based on existing policies already implemented or enacted, has 43% more solar output by 2040 than it expected in 2018, partly due to detailed new analysis showing that solar power is 20-50% cheaper than thought. Now what does it mean for fuels? For starters: greener and eventually cheaper EV charging, cheaper drop in electrofuels and cheaper green hydrogen.

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2. Electrek: A New York Bill Quietly Seeds the Ban of New ICE Cars by 2035 – This article notes that two days after California announced a ban on the sale of new gas-powered vehicles from 2035, New York state senator Pete Harckham from the Hudson Valley introduced a bill that would also require all of New York State’s sales of new cars and trucks to be zero emissions by 2035. Harckham’s bill also requires that all New York sales of off-road vehicles and power equipment be zero emissions by 2035, and medium-duty and heavy-duty trucks reach net zero by 2045. I searched for the legislation and couldn’t find it. I did find a press release announcing the legislation – that might be the reason for the quiet? Nevertheless, I believe it is just a matter of time before Northeast states follow California just as they have done with the Zero Emission Vehicle (ZEV), HD ZEV and other such programs.

Meantime, similar legislation was introduced in the U.S. House of Representatives and Senate as well. Do I see a national car ban in the U.S.? No, I don’t. Policymakers don’t have to go there. A President Biden, for example, can simply direct EPA to rescind and restate the original Obama-era fuel economy standards – and possibly tighten them further. A Democratic Congress can enact a national ZEV program that includes targets for both light- and HD ZEVs.

3. The Wall Street Journal: The State of California Wants to Run on Electricity. It’s Going to Need a Much Bigger Grid. – Energy consultants and academics say converting all passenger cars and trucks to run on electricity in California could raise power demand by as much as 25%, this article notes. This is a major challenge for a state already facing periodic rolling blackouts as it rapidly transitions to renewable energy.

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For example, it costs Electrify America 28% more to build stations in California than anywhere else in the U.S. because of the permitting processes in place. And, on average, permitting projects takes 60% longer.

4. EU Science Hub: JEC Well to Wheel (WTW) and Well to Tank (WTT) Analyses – Last week the European Commission’s Joint Research Centre, Concawe (the oil industry’s research organization) and EUCAR released their 5^th edition of its joint WTW and WTT analyses for both passenger cars and HDVs. The team considered fuel and electricity consumption and GHG emissions and used both the New European Driving Cycle (NEDC) for 2015 cases and the Worldwide Light-duty Test Procedure (WLTP) for 2025 cases. A few highlights follow:

As powertrain technology and fuel quality continues to improve, internal combustion engine vehicles (ICEVs) will continue to deliver TTW GHG emission reductions and energy savings compared to the baselines. Hybrids will deliver additional energy and GHG reduction.
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Pathways, such as alternative fuels based on waste cooking oil offer significant WTW performance improvements, up to 90%
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Electricity and hydrogen are energy vectors, so their WTW potential to lower CO2 emissions depend on the primary source of energy used for the production. The use of renewable electricity for EVs and hydrogen production for fuel cell electric vehicles (FCEVs) offer one of the lowest WTW intensive combinations.
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... WTT/WTW analyses are not lifecycle analyses which means the environmental impacts of battery manufacturing, for example, were not considered.

5. Reuters: Sole Survivor? Saudi Aramco Doubles Down on Oil to Outlast Rivals

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The company (Saudi Aramco) is uniquely advantaged: its oil has a carbon intensity of 10.1 kg of CO2 for each barrel produced (CO2e/boe), the lowest among its rivals, the article notes. It aims to push that down further by the end of the year. My own research has shown the company also plans to invest in carbon capture and storage (CCS). For an interesting perspective on Saudi Aramco’s thinking see the recent Fuels Institute webinar, Sustainability in Carbon Market. READ MORE

A New York bill quietly seeds the ban of new ICE cars by 2035 (Electrek)