AUGUST 21, 2024

Hello!

In this week’s edition:

• Bill sees hydrogen hopes meeting reality in Australia.
• A Voices article explores putting solar and power lines along highways.
• And in this week’s Data Dive, a look at Texas’ energy mix.

Our newsletter is taking a break next week, but please check out our full website for new stories! We’ll be back in your inboxes on September 4.

 
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Send your energy photos, story tips and more to news@ciphernews.com.

Illustration by Nadya Nickels.

In Australia, renewable hydrogen dreams are meeting reality

BY: BILL SPINDLE

Australia’s vision of becoming a global powerhouse in renewable hydrogen is running into some hard realities.

Read the full story here.

Highlights here:

Andrew "Twiggy" Forrest, the billionaire mining magnate who's been the loudest voice in the pro-renewable (or “green”) hydrogen chorus, recently raised eyebrows across the industry when he abruptly pulled back on his company Fortescue's ambitious plan to produce 15 million tons of green hydrogen annually by 2030. He also announced layoffs of 700 employees — many of them working on these hydrogen projects.

Forrest’s decision is more than a recalibration at one company; it’s a stark signal that the path to a hydrogen-powered future might be considerably bumpier than optimistic projections have suggested.

Hydrogen has long been hailed as a versatile, clean energy solution — often described as the “Swiss Army knife” of energy. It has the potential to replace fossil fuels across a range of industries, from power generation to heavy transport. But the reality is setting in that producing hydrogen in a way that doesn’t pump more carbon into the atmosphere is complex, expensive and, at least in the near term, not as commercially viable as hoped.

Australia, blessed with abundant wind and solar resources, seems the perfect place to lead the hydrogen revolution.

In South Australia, officials had been dreaming of turning the state’s vast renewable energy into hydrogen for everything from heating homes to exporting it as ammonia. But that dream is now being re-evaluated. Alan Finkel, the former chief scientist who laid out Australia’s hydrogen strategy, recently admitted that many of the uses for hydrogen he once championed no longer seem feasible. Costs are too high, and the technology isn’t there yet.

Globally, the picture isn’t much rosier. Countries like Japan and South Korea, once poised to be major importers of green hydrogen, are hesitating.

The cost of renewable hydrogen is currently two to four times that of conventional hydrogen, making the economics shaky even with hefty government subsidies.

The hydrogen dream isn’t dead, but it’s clear reality is forcing a rethink. The path to a hydrogen-fueled world may be longer and more winding than its most ardent supporters had envisioned.

Read the full article on Cipher’s website.

Editor’s note: Andrew Forrest is an investor in Breakthrough Energy Ventures, a program of Breakthrough Energy, which also supports Cipher.

This summary was written with the assistance of ChatGPT.

Lunchtime Reads and Hot Takes

US Leads the Way in Climate-Tech Funding, as China Falls Behind — Bloomberg
Amy’s take: Are one of those numbers about China a typo!? Wow that is a big drop-off. An analyst also says some money is going to artificial intelligence.

Big Tech’s bid to rewrite the rules on net zero — Financial Times (subscription)
Bill’s take: We’re seeing more of this from tech companies as their rising energy needs clash with their climate goals. The article includes a detailed analysis of the accounting for renewable energy certificates.

European Airlines Outpace US Carriers on Cleaner Jet Fuel — Bloomberg

Anca’s take: The chart showing common sustainable aviation fuel (SAF) targets and actual global SAF usage is striking! The sticks versus carrots approach also explains the Europeans' (more costly) leadership.

6,000 sheep will soon be grazing on 10,000 acres of Texas solar fields — Canary Media
Cat’s take: The intersection of agriculture and solar panel installation and use is called agrivoltaics. One fascinating tidbit in this story: Shade from the solar panels gives the sheep a way to stay cool!

How Booming Electricity Demand Is Stalling Efforts to Retire Coal and Gas, in Charts — The Wall Street Journal
Bill’s take: So far, the demand is being met by extending the life of existing plants. The climate risk really kicks in when new gas plants are built. Includes a good chart of U.S. growth projections by region.

In Pennsylvania, Harris can’t shake her anti-fracking past — The Washington Post
Amena’s take: As the nation's second largest natural gas producer, Pennsylvania has a lot riding on this sector. Although Harris has reversed her call for a fracking ban, it may not be enough for some voters.

Global warming slowdown projected, with caveats — Axios
Amy’s take: Flatten the curve, climate edition! The study doesn’t consider the potential for non-linear impacts, but this should be encouraging news overall and compel more, not less, action.

Maersk agrees to study nuclear-powered container shipping — Reuters
Cat’s take: An interesting idea to decarbonize a dirty sector. The companies will work together to assess what would be needed on the regulatory front to promulgate the idea of nuclear-powered cargo shipping.

Why Almost Nobody Is Buying Green Hydrogen — Bloomberg
Amy’s take: Key final quote from one (so far successful) developer: “We didn’t build a project and then go and try to sell people on it. We built a project around a customer.”

More of what we're reading:

• Australia approves $13.5 bln project to export solar power to Singapore — Reuters

• Solar breakthrough heralds energy revolution — University of Oxford
• U.S. chip, EV industries struggle to take off despite huge subsidies — Nikkei Asia
• Companies Haven’t Abandoned Sustainability. They’re Just Talking About It Less. — The Wall Street Journal

We denote ‘(subscription)’ when publications don’t provide any complimentary articles, but many others may ultimately allow you to read only a limited number each month before subscribing. We encourage those who can afford it to support the journalism you love most!

Mapping clean energy on the highway

Illustration by Nadya Nickels.

BY: ALLIE KELLY & PAT CUMMENS

Allie Kelly is the executive director of The Ray, a nonprofit developing renewable energy solutions for the transportation sector. You can reach Kelly at contactus@theray.org.

Pat Cummens is the director of government strategy and policy solutions at Esri, a leading geographic information system (GIS) software company. You can reach Cummens at pcummens@esri.com.

In the nearly 70 years since the Federal Aid Highway Act ushered in the age of the automobile, Americans have perpetually lengthened, expanded and fortified our network of interstates and freeways. We now urgently need to do the same with our electric grid.

As it turns out, the very same lanes that have fueled our car culture, and carbon emissions, could ultimately play a vital role powering our national grid with clean energy.

All along the vast lengths of federal and state highways across the United States lies a bounty of public land — our unassuming rights-of-way (ROWs). It’s where the infrastructure for our clean energy future, including solar panels and high-voltage transmission lines, can grow.

Already designated as public land, there are no lengthy environmental reviews, no need for eminent domain and no patchwork of owner approvals to wade through. Community outrage will likely be muted if it forms at all.

This is land we glimpse as we cruise by, barely giving it another thought. Why not put these buffers of land to more productive use?

That’s exactly what our organizations did in Georgia, where we installed a solar array along 18 miles of Interstate-85. We also have pilot projects being built along highways in Maryland, Pennsylvania, Maine, Wisconsin, Minnesota and Florida. We are constantly examining innovations that could make the most of our roadways, and in the distant future that could even include small-scale wind turbine technology producing energy from the airflow cars create as they zoom past.

Read the full article on Cipher’s website.

Charting Texas’ road to becoming a renewable energy powerhouse

Source: Joshua D. Rhodes, PhD, The University of Texas at Austin & IdeaSmiths LLC drawn from ERCOT data • Other includes solar, hydro, petroleum coke (pet coke), biomass, landfill gas, distillate fuel oil, net DC-tie and Block Load Transfer imports/exports and an adjustment for wholesale storage load.

BY: BILL SPINDLE

I first visited the Texas oil patch back in 2016 on assignment for The Wall Street Journal. As I passed through West Texas on my way to the fossil-fuel rich Permian Basin, I couldn’t help noticing something surprising: wind turbines everywhere.

I had stumbled onto the state’s clean little secret: a renewable energy boom, which, it turns out, was only just getting started. Already back then, wind energy had established itself as a growing pillar of the state’s power system, thanks to a private-public partnership driven by Republican oil tycoons, then-Governor George W. Bush and the now-deceased investor T. Boone Pickens.

I wrote about all this in a front-page page story in the Journal back then, noting that the impressive wind bonanza was about to be outdone by a surge in solar power.

That push is well under way now, as you can see in the data above from the Texas power authority, Electric Reliability Council of Texas, more commonly referred to as ERCOT.

Texas may be enamored with oil and gas, but its copious amounts of land and comparatively fewer permitting rules also make the Lone Star state better than nearly any other in the Union at utilizing renewable energy and batteries.

The chart shows not only the dramatic role wind power now plays — accounting for well over a quarter of generation in the first half of this year — but also the stunning rate of solar expansion. It has taken solar only about half the time wind needed to double from a 5% to a 10% share of the state’s power generation, and solar has done this in a system that is now much larger overall than it was two decades ago.

Not pictured, but critical to solar’s rise and its bright future, is ERCOT’s growing use of battery storage to help temper the variability of solar generation. Texas could add more battery capacity than even renewable-energy darling California this year and could pass California in total battery capacity as soon as next year.

AND FINALLY...
Alaska oilfield wind

Cipher reader and portfolio manager at AllianceBernstein Luke Pryor snapped this photo of an oil drilling rig next to a wind turbine on the remote Prudhoe Bay oilfield on Alaska's North Slope earlier this summer. The wind turbine was installed recently to help power the site, Pryor told Cipher, because usable energy is hard to access in the area. There’s no power grid and fuel has to be trucked in from hundreds of miles away.

Each week, we feature a photo that is somehow related to energy, the thing we all need but don’t notice until it’s expensive or gone. Email your ideas and photos to news@ciphernews.com.

Editor’s note: In addition to supporting Cipher, Breakthrough Energy also supports and partners with a range of entities working to tackle climate change, including nonprofits, corporations, startups and research firms. For more information on Cipher’s editorial policy, click here.