Global Climate News - May 4-8
Cost of Cleantech Manufacturing; UK advancing on uranium enrichment, fusion, and carbon capture;
Costs of Cleantech Manufacturing
From IEA’s new publication which evaluates 5 technologies - solar PV, wind, batteries, electrolysers, and heat pumps. I cover chapter 3 on costs here.
The following graphic shows the breakdown of a component’s cost - how much comes from the component directly upstream, and the other costs such as energy, materials and operations.
For instance, for solar modules, cells make up nearly 50% of the cost. For polysilicon, more than 60% of the cost is from energy. For wind components, energy costs are not significant, most cost comes from materials.
Solar
Cost of module manufacturing is 35-65% lower than the US and EU
Estimated manufacturing cost - USD 160/kW in 2023. “best-in-class” estimate - USD 125/kW in March 2024 in China
Global weighted average selling price in 2023 - USD 250/kW
Wind
Cost of manufacturing nacelles, blades and towers for onshore wind - USD 385/kW in China, USD 485-525/kW in Europe and the US
Costs are ~20% higher for offshore wind
Key costs contributors for different components
Blades - Labour costs
Towers - material, especially high-strength steel
Nacelles - other components such as generator and gearbox
Batteries
Estimated cost of manufacturing (including battery cell, electrolyte and casing) - USD 100/kWh in the US and Europe. Around 20-35% lower in China
Active materials in anode and cathode make up ~10% and 50% of cell cost
Lithium Ferro Phosphate (LFP) is about 30% cheaper to make
Electrolysers
Current utilisation of manufacturing capacity is low, around 10%
If utilisation reaches 85%, manufacturing cost for alkaline electrolysers could be between USD 45/kW (China) and 65/kW (Europe and USA)
Heat Pumps
Estimate manufacturing cost - USD 200-250/kW in Europe and USA; Costs for China ~50% lower
As most cost comes from materials and upstream components, vertically-integrated manufacturers have a competitive advantage
Cost of manufacturing facilities
Capex is highest - USD 300-540/kW - for wind component facilities as large buildings to store components, and heavy machinery are needed. Changing turbine size means the cost of equipment is divided over fewer units
For solar - USD 190-440kW
Electrolysers - USD 65-150/kW
Heat pumps - USD 60-175/kW
US & Europe facilities are nearly twice as expensive as China. For India, facility costs can be 20-90% higher than China
the variation in capital cost between regions accounts for a significant share of regional variation in total manufacturing cost; for example, around half of the difference in cost between producing solar PV in China and the United States
ET Energy | IEA - Advancing Clean Technology Manufacturing (May, 2024)
News from Governments
Italy has banned installing ground-mounted solar panels on agricultural land. Panels installed over crops are still permitted. Reuters
The US has passed legislation to ban import of low-enriched uranium from Russia, to encourage domestic production of nuclear fuel. Utility Dive | H.R.1042 - Prohibiting Russian Uranium Imports Act
Australia has published a Future Gas Strategy that aims to optimise gas use to reduce emissions, while keeping gas affordable, developing new gas production, and remaining a global trading partner for LNG and low-emission gases. Press Release | Future Gas Strategy
The UK
has announced £196 million in funding for a uranium enrichment facility, expected to be ready by 2031, for supplying nuclear fuel. GOV.UK
is working on a National Policy Statement for fusion energy, to aid planning, siting and regulation of fusion facilities. GOV.UK (PDF)
has announced a competition to look for industry partners to build a prototype fusion power plant.
STEP (Spherical Tokamak for Energy Production) will be built at West Burton, the site of a former coal-fired power station site in Nottinghamshire, and aims to demonstrate net energy from fusion in the 2040s. GOV.UK
Top Stories
UK and France lead tidal stream energy installations, with 200kW and 80kW respectively deployed in 2023. Government incentives in both countries are enabling pre-commercial farms. The US has also announced significant incentives for tidal stream energy, with state-level support in California and Oregon. For wave energy, most installations in Europe were in the south - Portugal, Italy, Spain. Offshore Energy | Ocean Energy Europe - Ocean Energy Stats & Trends 2023 (PDF)
The PosHydon project, off the coast of Netherlands, is a pilot project that combines offshore wind, offshore gas and offshore hydrogen. The project will use offshore wind energy to desalinate seawater and produce hydrogen from it, and is the first test for an electrolyzer in offshore conditions. The hydrogen produced will be mixed with natural gas and transported via pipelines. Offshore Energy | PosHydon
Ireland-based Silicate is using the natural silicate-carbonate cycle for carbon removal. Surplus concrete, which contains silicate, hydroxide and carbonate minerals, is milled to a fine dust and spread on agricultural fields to improve soil pH. As the moisture in the soil breaks down the minerals in the concrete, calcium and bicarbonate (HCO3-) ions are released. As per Silicate,
This bicarbonate anion is a stable store of carbon. Both the bicarbonate and calcium ions remain in solution in surface and ground waters before flowing to the ocean, where they have a residence time of 80,000 years. On average, after 80,000 years, the negatively charged bicarbonate ions bond with the positively charged calcium ions to precipitate limestone (CaCO3) on the ocean floor, leading to carbon removal lasting millennia.
The company measures how much carbon is removed and generates carbon credits for it. Silicate is also among the top 20 finalists in the Carbon Removal XPRIZE.
Environmental taxes in the UK contributed £52.5 billion in 2023, with 75% coming from energy taxes. The implementation of the UK Emissions Trading Scheme (ETS), in place of the EU ETS, from 2021, added £5.8 billion in environmental tax revenue. UK Office for National Statistics
Contributors to environmental tax revenue by tax type, UK, 2023, Src: UK Office for National Statistics (captured May 2024) BMW’s new range of electric vehicles, “Neue Klasse”, slated for launch in 2025, will have bidirectional charging tech - the ability to supply power back to homes and the grid. Automotive Dive | BMW Press Release
Japanese shipping companies are recycling used lashing belts (image below) used to secure cargo, into RPF fuel. RPF - Refuse derived paper and plastics densified Fuel - is a solid fuel, made of paper and plastic from industrial waste, that can be used in place of coal and coke in industries like paper. The calorific value of the fuel can be altered by changing the ratio of plastic and paper. Since the fuel is made from industrial waste, it has few impurities, which makes it easier to treat exhaust gases generated during its combustion and also has low sulphur emissions.
Lashing Belts for securing cargo, Src Work is underway on the Celtic interconnector - a 500km subsea cable to connect the power grids of France and Ireland. Estimated completion in 2026. Offshore Energy
Germany-based Xylem is making beer using treated wastewater. businesswire | Xylem Press Release
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