Welcome to the weekly roundup from the Oxford Martin Programme on Integrating Renewable Energy.
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Clean energy around the globe

A comprehensive new report from Bloomberg New Energy Finance (BNEF) shows that the world’s five largest oil firms—ExxonMobil, Chevron, Royal Dutch Shell, BP, and Total—cut their combined emissions by 13% from 2010 to 2015. BP cut its emissions the most (25.5%) while the heaviest polluter, Exxon, reduced its emissions 14%. The BNEF report argues that despite the 2014 oil price crash, which likely caused some of these reductions, the five supermajor oil companies have adopted climate, energy efficiency, and pollution-reduction policies that have contributed to these reductions.
According to new global data from the Renewable Energy Policy Network for the 21st Century (REN21), renewable energy capacity increased by a record amount in 2016 (161 GW, a 10% rise from 2015) despite total financial investment in renewables falling, meaning that new capacity was delivered at a significantly lower cost. The Renewables 2017 Global Status Report shows that rapidly declining costs for solar and wind power led to numerous power deals in countries, including Denmark, Egypt, India, Mexico, and the UAE, where prices for renewables were well below fossil fuel or nuclear options.
India set a record for power generation from renewables in June 2017, as the country increased its supply of renewable electricity 26% from the same month in the previous year and 17% from May 2017. India’s total installed solar power capacity has grown three-fold to 13 GW over the past two years, and the country’s share of renewables in its total electricity generation portfolio increased to 9.5% from 7.7% in the previous year. India’s current target for renewables is an ambitious 175 GW by the end of 2022, including 100 GW from solar.
In pursuit of its goal of producing half of its energy needs from renewables by 2020, Finland announced that the share of renewable energy sources in its power generation will exceed the percentage share of fossil fuel sources sometime in 2018. Last year, the share of renewables in Finland’s total energy generation was 34% while fossil fuels accounted for 38%. The remaining sources were nuclear and peat. Due to its climate and energy-intensive industries, Finland has the largest per capita energy consumption in the European Union.     
Brazil has significant renewable energy potential, and after the country invested heavily in hydropower, several intense droughts in recent years have convinced governments of the need to diversify the country’s energy resources. The Brazilian government claims that wind is now a cheaper producer of power than hydroelectric dams, and the country ranked 9th in the world in installed wind power capacity at 10.7 GW, according to the Global Wind Energy Council (GWEC). By August this year, Brazil’s wind power capacity had surpassed 11.6 GW spread across 466 wind farms.

Energy storage

According to a new poll of 2,000 Australian households, nearly three-quarters of those surveyed believe solar systems coupled with batteries are the key to cheaper and more reliable energy and will become commonplace in the next ten years. Of those who reported already owning a solar system, more than two-thirds indicated they were considering adding a household battery system, with the primary motivation being the opportunity to further reduce power bills.
As small-scale residential energy storage looks primed for rapid growth in Australia in coming years, large-scale energy storage, especially pumped hydro, looks to be increasingly suitable for the country, as well. Researchers at Australian National University found that Australia has the capacity to store up to 1,000 times more renewable energy than it would need using pumped hydro, with 22,000 locations proving suitable in the country (totalling approximately 67,000 GWh of energy storage potential). Researchers said that if pumped hydro systems were built in just a fraction of those locations, Australia could transition to 100% renewables in just two decades.
The world’s largest lithium-ion battery is installed in Escondido, California, north of San Diego. The battery can discharge up to 30 MW and can maintain that level for up to four hours, powering the equivalent of 20,000 homes. The battery system was built in response to a four-month blowout at southern California’s Aliso Canyon natural gas storage facility, which ruptured in October 2015 and leaked more gas into the atmosphere than any other spill in US history.
Along with hosting the world’s largest battery, California is also one of the leading US states for both renewable energy production and energy storage. The state’s 50% renewables target by 2030 is one of the highest in the country, and it also has one of the first statewide incentives for energy storage. AB 2514 requires the state’s three investor-owned utilities (IOUs) to procure 1.3 GW of energy storage by 2020, and they are already well on their way as Southern California Edison (SCE) has installed 400 MW of storage toward its 582 MW target.
A lack of adequate insurance for energy storage may be holding the sector back. According to industry experts, the lack of insurance coverage will create barriers to entry for new players in the storage space and is probably the greatest danger to continuing price reductions. Similar insurance arrangements to those available for renewable energies such as wind would benefit energy storage, especially as the lack of new competitive pressure and an over-reliance on warranties may slow the current slide in energy storage costs.

Demand response

Last year, the European Commission proposed a general framework for independent aggregators in its draft Electricity Directive to incentivise the development of demand response (DR) in Europe. The Commission’s proposal says that aggregators should not be required to compensate suppliers for the electricity sourced and only exceptionally for the imbalances induced, but a new study carried out by independent experts from the consultancy DNV GL for Eurelectric argues that the Commission’s proposal as it stands risks reducing the economic efficiency of DR and impacting the energy retail market.
The concept of peer-to-peer energy markets continues to gain interest around the world, and a German start-up is aiming to deliver its product country-wide. GridX, which sells the gridbox, a product that works as a switch between a home-owner’s solar panels, battery storage system, and the national grid, says the technology can save an average customer US$300 per year by selling excess energy to other consumers. GridX’s technology differs from other recent peer-to-peer energy start-ups, such as Brooklyn Microgrid, because it taps directly into the national grid, thus enabling consumers to buy and sell energy anywhere in the country.
California’s recent record-breaking heatwave showed why the state’s system operator, CAISO, is about to change compensation rules for DR provided to the state’s wholesale market. The current compensation mechanism’s failure was revealed during the heatwave when a leading DR provider, Advanced Microgrid Solutions (AMS), claimed that it delivered 100% of what it was asked to deliver but that CAISO only recognised 53% of this delivery. This is because currently, the system operator uses a “counterfactual” to determine appropriate compensation for DR. To know how much the DR reduced load, the operator estimates what the load would have been without DR, but without a metered battery that measures output, the counterfactual, or simply the baseload total from the previous 10 days, is used. Inaccurate estimates of the load without DR can compromise both the value proposition and the competitiveness of DR, which is why DR stakeholders in California are aiming to fix the compensation rules.
Target and other similar companies are turning to DR programmes to cut energy and supply chain costs. Over the past decade, Target has enrolled almost half of its 1,800 stores in various versions of DR programmes, which turn off or decrease specific HVAC rooftop units, dim store lights, or increase in-store temperatures by one to three degrees every few hours. In return for agreeing to use less power during peak times, Target earns curtailment credits, thus increasing revenue, offsetting operating expenses, and contributing to corporate sustainability goals.

6th Annual Oxford Energy Day: Energy in Growing Economies

The 6th Annual Oxford Energy Day will be held on Monday, 2 October, from 9:30am – 6pm at the Oxford University Maths Institute. This year the focus is on Energy in Growing Economies, where the way increasing energy is provided could have important lessons for the rest of the world.

Speakers include:  
Rachel Kyte - Special Representative of the UN Secretary-General for Sustainable Energy
Jiang Kejun - National Development and Reform Commission, China
Anil Kumar Jain - Ministry of Environment, Forest and Climate Change, India
Samson Ondiek - Kenya Power and Light
Mike Mason - Chairman Tropical Power
Phil Mann - DfID
Adam Bruce - Mainstream Renewable Power
See full programme here, and if you are interested in attending, please register here.

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