Bridging to a Bridging to a ReducedReduced--Carbon Carbon Future Energy SystemFuture Energy System

Stanford University GCEP SeminarApril 2004

John H. ShinnSenior Staff Adviser, Global Issues

ChevronTexaco

Importance of BridgingImportance of BridgingImportance of Bridging

From PAST… – Benefits from history

Possible successful transition approaches.How long should it take?What resources might be needed?

And PRESENT… – Examines key features of current state,

opportunities for change

To FUTURE:– Build to new system from existing

From PAST… From PAST… –– Benefits from historyBenefits from history

Possible successful transition approaches.Possible successful transition approaches.How long should it take?How long should it take?What resources might be needed?What resources might be needed?

And PRESENT… And PRESENT… –– Examines key features of current state, Examines key features of current state,

opportunities for changeopportunities for change

To FUTURE:To FUTURE:–– Build to new system from existingBuild to new system from existing

Advantages of BridgingAdvantages of BridgingAdvantages of Bridging

Reduced transition cost– Lower capital requirements

Improved penetration rates– ‘piggie-backing” on current system

Immediate and long-term benefits– Improves current system toward future system– Not just ‘incrementalism’ but planned integration

Intentionally addresses questions on “How do we get there from here?”

Reduced transition costReduced transition cost–– Lower capital requirementsLower capital requirements

Improved penetration ratesImproved penetration rates–– ‘‘piggiepiggie--backing” on current systembacking” on current system

Immediate and longImmediate and long--term benefitsterm benefits–– Improves current system toward future systemImproves current system toward future system–– Not just ‘Not just ‘incrementalismincrementalism’ but planned integration’ but planned integration

Intentionally addresses questions on “How do Intentionally addresses questions on “How do we get there from here?”we get there from here?”

Bridging to Reduced Carbon EnergyBridging to Reduced Carbon Bridging to Reduced Carbon EnergyEnergy

What: – Energy Supply By Fuel: Historic, recent

Where: – Consumption By Region– Sector Issues

Link to other reduction opportunities:– Current GHG Reduction opportunities

Other bridges to consider– Policy bridges– Business – Technical resource and educational needs

What: What: –– Energy Supply By Fuel: Historic, recentEnergy Supply By Fuel: Historic, recent

Where: Where: –– Consumption By RegionConsumption By Region–– Sector IssuesSector Issues

Link to other reduction opportunities:Link to other reduction opportunities:–– Current GHG Reduction opportunitiesCurrent GHG Reduction opportunities

Other bridges to considerOther bridges to consider–– Policy bridgesPolicy bridges–– Business Business –– Technical resource and educational needsTechnical resource and educational needs

Bridge 1: What to ChangeGlobal Primary energy supply

Bridge 1: Bridge 1: What to ChangeWhat to ChangeGlobal Primary energy supplyGlobal Primary energy supply

Historic trends– Expected rates of

change.– Move toward lower

carbon.

Recent changes– What are the more

likely transitions?

Historic trendsHistoric trends–– Expected rates of Expected rates of

change.change.–– Move toward lower Move toward lower

carbon.carbon.

Recent changesRecent changes–– What are the more What are the more

likely transitions?likely transitions?

Changing the World’s Energy Supply Is a Slow ProcessChanging the World’s Energy Supply Is a Slow Process

Historical and Projected Trends in Global Primary Energy Consumption(Fraction of Global Energy Market)Historical and Projected Trends in Global Primary Energy Consumption(Fraction of Global Energy Market)

Typical Penetration Rates: 1-10% or 10-30% = 30-50 yearsTypical Penetration Rates: 1-10% or 10-30% = 30-50 years

Source: C. Marchetti and N. Nakicenovic. 1984. “The Dynamics of Energy Systems and the Logistic Substitution Model,” Research Report 79-13, IIASA, Laxenburg, Austria.Cited: Lee, T., B. Ball, and R. Tabors, Energy Aftermath, Harvard Business School Press, 1990.

Source: C. Marchetti and N. Nakicenovic. 1984. “The Dynamics of Energy Systems and the Logistic Substitution Model,” Research Report 79-13, IIASA, Laxenburg, Austria.Cited: Lee, T., B. Ball, and R. Tabors, Energy Aftermath, Harvard Business School Press, 1990.

Global Primary Energy SupplyRecent TrendsGlobal Primary Energy SupplyGlobal Primary Energy SupplyRecent TrendsRecent Trends

1973 6034 MTOE

CoalOilGasNuclearHydroWood+Renew

1973 6034 MTOE

CoalOilGasNuclearHydroWood+Renew

200310029 MTOE

200310029 MTOE

Source: IEA Key Energy Statistics 2003

Some Conclusions on “What”Some Conclusions on “What”Some Conclusions on “What”

Needs to meet growth – 2/3 Increase over 30 years in total supply

Hydrocarbons still the energy of the future– Coal maintaining

Reserves-Infrastructure-Cost advantages– Oil dropping in share– Gas growing; appears able to expand

Fit to slow decarbonization trend (Coal to Oil to Gas)– 1973: 25-45-15– Now: 23-35-20

Suggests a natural gas bridge???

Needs to meet growth Needs to meet growth –– 2/3 Increase over 30 years in total supply2/3 Increase over 30 years in total supply

Hydrocarbons still the energy of the futureHydrocarbons still the energy of the future–– Coal maintaining Coal maintaining

ReservesReserves--InfrastructureInfrastructure--Cost advantagesCost advantages–– Oil dropping in shareOil dropping in share–– Gas growing; appears able to expandGas growing; appears able to expand

Fit to slow Fit to slow decarbonizationdecarbonization trend trend (Coal to Oil to Gas)(Coal to Oil to Gas)–– 1973: 251973: 25--4545--1515–– Now: 23Now: 23--3535--2020

Suggests a natural gas bridge???Suggests a natural gas bridge???

A Natural (Gas) Step Toward H2A Natural (Gas) Step Toward H2A Natural (Gas) Step Toward H2

050

100150200250300350400

Coal Oil Methane

CH

Molecules Hydrogen per 100 Carbon atomsMolecules Hydrogen per 100 Carbon atoms

03/08/00 GDL G2000164 Shinn 9

Greenhouse Advantage of GasGreenhouse Advantage of Gas

Life-Cycle Greenhouse Gas Emissions - Power GenerationLife-Cycle Greenhouse Gas Emissions - Power Generation

0

500

1000

1500

kg CO2 Eq/MWHr

AustrBrownCoal

AustrBlack Coal

Mid-EastOil

LNG

Advantages of Natural Gas TransitionAdvantages of Natural Gas TransitionAdvantages of Natural Gas Transition

Affordable today

Potential double benefits– Flare reduction example

Current dominant source of hydrogen; likely best source for decades– Gas distribution infrastructure facilitates

hydrogen transition

Affordable todayAffordable today

Potential double benefitsPotential double benefits–– Flare reduction exampleFlare reduction example

Current dominant source of hydrogen; likely Current dominant source of hydrogen; likely best source for decadesbest source for decades–– Gas distribution infrastructure facilitates Gas distribution infrastructure facilitates

hydrogen transitionhydrogen transition

Bridge 2: Where to ChangeBridge 2: Bridge 2: Where to ChangeWhere to Change

Regional picture

Expected Investment trends

SectoralOpportunities

Regional pictureRegional picture

Expected Investment Expected Investment trendstrends

SectoralSectoralOpportunitiesOpportunities

Consumption by RegionConsumption by RegionConsumption by Region

19734548 MTOE

OECD

FormerUSSR

China

OtherAsia

Lat Amer

Africa

MidEast

Other

19734548 MTOE

OECD

FormerUSSR

China

OtherAsia

Lat Amer

Africa

MidEast

Other

20016995 MTOE

20016995 MTOE

Source: IEA Key Energy Statistics 2003

“Where” Observations“Where” Observations“Where” Observations

Developed Country dominance shrinking– Down from 62% to 52%

Substantial opportunities to affect energy supply in both developed AND developing world– Considerable new investments in developed

regions (although not large relative to existing infrastructure)

– Developing regions (esp Asia) largest growth area

Greatest opportunity areas to change carbon intensity

Developed Country dominance shrinkingDeveloped Country dominance shrinking–– Down from 62% to 52%Down from 62% to 52%

Substantial opportunities to affect energy Substantial opportunities to affect energy supply in both developed AND developing supply in both developed AND developing worldworld–– Considerable new investments in developed Considerable new investments in developed

regions (although not large relative to existing regions (although not large relative to existing infrastructure)infrastructure)

–– Developing regions (Developing regions (espesp Asia) largest growth Asia) largest growth areaarea

Greatest opportunity areas to change Greatest opportunity areas to change carbon intensitycarbon intensity

Expected “Where” Profile of Future Energy Investments (to 2030)Expected “Where” Profile of Future Expected “Where” Profile of Future Energy Investments (to 2030)Energy Investments (to 2030)

Source: IEA

Expected Energy Investment Distribution to 2030Expected Energy Investment Expected Energy Investment Distribution to 2030Distribution to 2030

Source: IEA

TransportationTransportationTransportation

Transport 1973959 MTOE

Coal

Oil Prods

Gas

Wood+

Renew

Transport 1973959 MTOE

Coal

Oil Prods

Gas

Wood+

Renew

20011802 MTOE

20011802 MTOE

•Almost doubled in 30 years•Continued dominance of oil

Source: IEA Key Energy Statistics 2003

Bridge 3: Current opportunities for GHG reduction Petroleum industry example

Bridge 3: Bridge 3: Current opportunities for GHG Current opportunities for GHG reduction reduction Petroleum industry examplePetroleum industry example

Distribution by emissions type

The Flare Reduction multiple opportunity– Reduce emissions– Increase gas supply – Improve resource

use effectiveness

Distribution by Distribution by emissions typeemissions type

The Flare Reduction The Flare Reduction multiple opportunitymultiple opportunity–– Reduce emissionsReduce emissions–– Increase gas supply Increase gas supply –– Improve resource Improve resource

use effectivenessuse effectiveness

‘Typical’ Petroleum Company GHG Emissions Profile‘Typical’ Petroleum Company ‘Typical’ Petroleum Company GHG Emissions ProfileGHG Emissions Profile

Combustion64.0%

Flaring28.0%

Other8.0%

Potential Areas for PetroleumIndustry Emissions Reduction ProjectsPotential Areas for PetroleumPotential Areas for PetroleumIndustry Emissions Reduction ProjectsIndustry Emissions Reduction Projects

Combustion– Power and steam generation– Energy efficiency– Fuel switching

Alternate energy– Solar, wind, geothermal

Flare Reduction– Enhance competition vsnon-associated gas use

CombustionCombustion–– Power and steam generationPower and steam generation–– Energy efficiencyEnergy efficiency–– Fuel switchingFuel switching

Alternate energyAlternate energy–– Solar, wind, geothermalSolar, wind, geothermal

Flare ReductionFlare Reduction–– Enhance competition vsEnhance competition vsnonnon--associated gas useassociated gas use

Addressing Global Gas Flaring Reduction

Combustion64.0%

Flaring28.0%

Other8.0%

Associated Gas Flaring: The ChallengeAssociated Gas Flaring: Associated Gas Flaring: The ChallengeThe Challenge

Large quantities of gas produced as a byproduct of oil production are flared worldwide.

Solutions are needed that enable this valuable resource to be utilized effectively.

Magnitude of the IssueMagnitude of the IssueMagnitude of the Issue

Wasted Resource - 110 Bcm/yr (>3 TCF)– 37 BCM Flared in Africa = 200 TWh of CCGT

power productionenough power for 85 million low-income urban households

An environmental problem - 300+ Mt CO2e– >10% of Annex 1 countries’ Kyoto

commitments

– Local effects – health and ecosystems near flaring sites

Wasted Resource - 110 Bcm/yr (>3 TCF)– 37 BCM Flared in Africa = 200 TWh of CCGT

power productionenough power for 85 million low-income urban households

An environmental problem - 300+ Mt CO2e– >10% of Annex 1 countries’ Kyoto

commitments

– Local effects – health and ecosystems near flaring sites

Flaring Reduction OptionsFlaring Reduction OptionsFlaring Reduction Options

Bring Gas To Market

Re-injection

Stop Production (“Shut-in”)

Bring Gas To MarketBring Gas To Market

ReRe--injectioninjection

Stop Production Stop Production (“Shut(“Shut--in”)in”)

Gas to Market Technical Solutions Gas to Market Technical Solutions Gas to Market Technical Solutions

Gas-To-Liquids

LNGCNG Shipping

Pipelines

Gas Treating & Reinjection

“Gas To Wires”?

Source: U Houston

Gas to Market Barriers Gas to Market Barriers Gas to Market Barriers Distance from markets

Lack of local utilization or export infrastructure

Cost competitiveness against non-associated gas resources

Regional fiscal terms

Regional political stability

Multiple Potential Benefits:The West African Gas Pipeline Example

Multiple Potential Benefits:Multiple Potential Benefits:The West African Gas The West African Gas Pipeline ExamplePipeline Example

Gas FlaresGas Flares

80 Million TCarbon

80 Million TCarbon

1. Nigeria Today1. Nigeria Today

100 Million TCarbon

100 Million TCarbon

TreesTrees

Fuel OilFuel Oil

Fuel ChoiceBased onLowest Cost

Fuel ChoiceBased onLowest Cost

GhanaGhana

2. What Would Otherwise Occur2. What Would Otherwise Occur80 Million T Carbon

80 Million T Carbon

CharcoalCharcoal

0 Million TCarbon

0 Million TCarbon

3. Same Growth But With Pipeline3. Same Growth But With Pipeline80 Million TCarbon

80 Million TCarbon

Gas PipelineGas Pipeline

TreesTrees

Additional Benefits:• Reduce Air Pollution• Reduce Desertification• Preserve Bio-Diversity• Improve Health• Sequestration in Trees

Additional Benefits:• Reduce Air Pollution• Reduce Desertification• Preserve Bio-Diversity• Improve Health• Sequestration in Trees

Capture and StorageCapture and StorageCapture and Storage

Extends prospects for fossil fuels

Current applications…– Enhanced oil recovery (EOR)– Offshore Norway (avoid high CO2 tax)

Larger use inhibited by…– High capture cost– Source/sink matches for EOR

applications

Extends prospects for fossil fuelsExtends prospects for fossil fuels

Current applications…Current applications…–– Enhanced oil recovery (EOR)Enhanced oil recovery (EOR)–– Offshore Norway (avoid high CO2 tax)Offshore Norway (avoid high CO2 tax)

Larger use inhibited by…Larger use inhibited by…–– High capture costHigh capture cost–– Source/sink matches for EOR Source/sink matches for EOR

applicationsapplicationsSource: Statoil

Capture and StorageBridging StrategyCapture and StorageCapture and StorageBridging StrategyBridging Strategy

Demonstrate safe storage first– Pre-concentrated streams

Refinery hydrogen plantsNatural gas separationAmmonia plants

– High value end-usesEORCoal bed methane??

– Match source and sink locationsIntentional siting of new facilities

Improve capture costs

Demonstrate safe storage firstDemonstrate safe storage first–– PrePre--concentrated streamsconcentrated streams

Refinery hydrogen plantsRefinery hydrogen plantsNatural gas separationNatural gas separationAmmonia plantsAmmonia plants

–– High value endHigh value end--usesusesEOREORCoal bed methane??Coal bed methane??

–– Match source and sink locationsMatch source and sink locationsIntentional Intentional sitingsiting of new facilitiesof new facilities

Improve capture costsImprove capture costsSource: Statoil

Some Other Important BridgesSome Other Important BridgesSome Other Important Bridges

Governmental – Policy bridges

Business

Technical Capability

Governmental Governmental –– Policy bridgesPolicy bridges

BusinessBusiness

Technical Capability Technical Capability

Policy Bridges IExpanded ScopePolicy Bridges IPolicy Bridges IExpanded ScopeExpanded Scope

From single governments to Inter-governmental

Simplified routes to concurrence– From 170 parties to bottoms up?

From bilaterals/multilaterals/regional approaches

From local/regional to global thinking– Changes appropriate policy approaches

Local controls very likely sub-optimumE.g. Californina control on vehicle GHGs

From single governments to InterFrom single governments to Inter--governmentalgovernmental

Simplified routes to concurrenceSimplified routes to concurrence–– From 170 parties to bottoms up?From 170 parties to bottoms up?

From From bilateralsbilaterals/multilaterals/regional /multilaterals/regional approachesapproaches

From local/regional to global thinkingFrom local/regional to global thinking–– Changes appropriate policy approachesChanges appropriate policy approaches

Local controls very likely subLocal controls very likely sub--optimumoptimumE.g. E.g. CaliforninaCalifornina control on vehicle control on vehicle GHGsGHGs

Policy Bridges IIBuilding CooperationPolicy Bridges IIPolicy Bridges IIBuilding CooperationBuilding Cooperation

North-South balance –From conflicting to cooperative–Mutual wins needed

e.g. Clean Development Mechanism

NorthNorth--South balance South balance –– From conflicting to cooperativeFrom conflicting to cooperative–– Mutual wins needed Mutual wins needed

e.g. Clean Development e.g. Clean Development Mechanism Mechanism

Clean Development MechanismClean Development MechanismClean Development Mechanism

Provides GHG reduction credits to projects in developing countries

Gives incentive for …– developing countries to choose cleaner

technologies– developed county participants to fund these

projects

Provides GHG reduction credits to projects in Provides GHG reduction credits to projects in developing countriesdeveloping countries

Gives incentive for …Gives incentive for …–– developing countries to choose cleaner developing countries to choose cleaner

technologiestechnologies–– developed county participants to fund these developed county participants to fund these

projectsprojects

C D M

Example Offset/Credit OpportunitiesExample Offset/Credit OpportunitiesExample Offset/Credit Opportunities

Forestry (West Australia, Louisiana, Brazil)

Fuel Switching– From higher carbon fuels to natural gas

Korea, Ghana– Gas vs oil for steam generation

Geothermal energy generation (Indonesia)

Flare Reduction (Nigeria, Angola)

Geologic storage (Australia)

Wind Energy (Netherlands)

Hydrogen production/fuel cells

Forestry (West Australia, Louisiana, Brazil)Forestry (West Australia, Louisiana, Brazil)

Fuel SwitchingFuel Switching–– From higher carbon fuels to natural gasFrom higher carbon fuels to natural gas

Korea, GhanaKorea, Ghana–– Gas vs oil for steam generationGas vs oil for steam generation

Geothermal energy generation (Indonesia)Geothermal energy generation (Indonesia)

Flare Reduction (Nigeria, Angola)Flare Reduction (Nigeria, Angola)

Geologic storage (Australia)Geologic storage (Australia)

Wind Energy (Netherlands)Wind Energy (Netherlands)

Hydrogen production/fuel cellsHydrogen production/fuel cells

Policy Bridges IIBuilding CooperationPolicy Bridges IIPolicy Bridges IIBuilding CooperationBuilding Cooperation

Multi-stakeholder processes– Increased involvement of

businesses/Non-governmental organizations

– Johannesburg Partnership model

Flaring example

MultiMulti--stakeholder processesstakeholder processes–– Increased involvement of Increased involvement of

businesses/Nonbusinesses/Non--governmental governmental organizationsorganizations

–– Johannesburg Partnership Johannesburg Partnership modelmodel

Flaring exampleFlaring example

International Partnership Example:Global Gas Flaring Reduction PartnershipInternational Partnership Example:International Partnership Example:Global Gas Flaring Reduction PartnershipGlobal Gas Flaring Reduction Partnership

Public-private partnership to support flaring reduction– Help national governments achieve real

reductions– Improve framework for private sector

investments

Becoming the key player in flaring policy, credits, associated gas regulations.

PublicPublic--private partnership to support flaring private partnership to support flaring reductionreduction–– Help national governments achieve real Help national governments achieve real

reductionsreductions–– Improve framework for private sector Improve framework for private sector

investmentsinvestments

Becoming the key player in flaring policy, Becoming the key player in flaring policy, credits, associated gas regulations.credits, associated gas regulations.

Policy Bridges IIIMarket ApproachesPolicy Bridges IIIPolicy Bridges IIIMarket ApproachesMarket Approaches

$/ton focusFrom command and control to maximum benefit focus

– Emissions trading– Addressing market access issues

• Flared gas• Grid access

From Environmental Economics (“Triple Bottom Line”) to “Economic Environmentalism”– Harness profit motive

$/ton focus$/ton focusFrom command and control to maximum benefit From command and control to maximum benefit focusfocus

–– Emissions tradingEmissions trading–– Addressing market access issuesAddressing market access issues

•• Flared gasFlared gas•• Grid accessGrid access

From Environmental Economics (“Triple Bottom Line”) From Environmental Economics (“Triple Bottom Line”) to “Economic Environmentalism”to “Economic Environmentalism”–– Harness profit motiveHarness profit motive

A “Tacoma Narrows” Bridge?California’s Vehicle GHG ControlsA “Tacoma Narrows” Bridge?A “Tacoma Narrows” Bridge?California’s Vehicle GHG ControlsCalifornia’s Vehicle GHG Controls

Wrong Directions– Limits market for reductions – one state, one sector

Further isolates Ca vehicles, possibly fuelsDrives ‘leakage’ of emissions outside of CA

– Very likely high $/ton; ignores lower cost approaches– Subject to legal challenges

Questionable benefit– Only shifts emissions?

If electric, GHGs from power generationCombined with CAFÉ (Federal) Standards…– California reductions enable others to emit – No national emission changes result – Californians pay

Wrong DirectionsWrong Directions–– Limits market for reductions Limits market for reductions –– one state, one sectorone state, one sector

Further isolates Ca vehicles, possibly fuelsFurther isolates Ca vehicles, possibly fuelsDrives ‘leakage’ of emissions outside of CADrives ‘leakage’ of emissions outside of CA

–– Very likely high $/ton; ignores lower cost approachesVery likely high $/ton; ignores lower cost approaches–– Subject to legal challengesSubject to legal challenges

Questionable benefitQuestionable benefit–– Only shifts emissions?Only shifts emissions?

If electric, If electric, GHGsGHGs from power generationfrom power generationCombined with CAFÉ (Federal) Standards…Combined with CAFÉ (Federal) Standards…–– California reductions enable others to emit California reductions enable others to emit –– No national emission changes result No national emission changes result –– Californians payCalifornians pay

A Better Bridge For California?A Better Bridge For California?A Better Bridge For California?

2004

Climate-Friendly Vehicle

California

Voluntary “Green Vehicle” Certificate Program?Voluntary “Green Vehicle” Voluntary “Green Vehicle” Certificate Program?Certificate Program?

State sells certificates offsetting vehicle emissionsUses funds to support emissions reducing projects world-wide (or purchases from other credible sources e.g. CDM, PCF, etc)

Multiple Benefits:– Real emissions reductions

Enhances global solutions, cooperationSupports reduced carbon infrastructure deployment

– Market experienceCreates access to low-cost credits Experience/influence in emerging global carbon markets

– Resolves Vehicle GHG program issuesNo legal challengesNo isolation of markets, vehicles, fuels

– Easily DeployedCan be gradually deployed, easily scaledCan utilize existing “Registry” program

State sells certificates offsetting vehicle emissionsState sells certificates offsetting vehicle emissionsUses funds to support emissions reducing projects worldUses funds to support emissions reducing projects world--wide (or wide (or purchases from other credible sources e.g. CDM, PCF, etc)purchases from other credible sources e.g. CDM, PCF, etc)

Multiple Benefits:Multiple Benefits:–– Real emissions reductionsReal emissions reductions

Enhances global solutions, cooperationEnhances global solutions, cooperationSupports reduced carbon infrastructure deployment Supports reduced carbon infrastructure deployment

–– Market experienceMarket experienceCreates access to lowCreates access to low--cost credits cost credits Experience/influence in emerging global carbon marketsExperience/influence in emerging global carbon markets

–– Resolves Vehicle GHG program issuesResolves Vehicle GHG program issuesNo legal challengesNo legal challengesNo isolation of markets, vehicles, fuelsNo isolation of markets, vehicles, fuels

–– Easily DeployedEasily DeployedCan be gradually deployed, easily scaledCan be gradually deployed, easily scaledCan utilize existing “Registry” programCan utilize existing “Registry” program

Business Bridge:A New Energy Business Model? Business Bridge:Business Bridge:A New Energy Business Model? A New Energy Business Model?

From “denial” to active integration into business development

– Inventory– Capital Projects GHG Evaluation– Projections– R&D– New Business development

From “denial” to active integration From “denial” to active integration into business developmentinto business development

–– InventoryInventory–– Capital Projects GHG EvaluationCapital Projects GHG Evaluation–– ProjectionsProjections–– R&DR&D–– New Business developmentNew Business development

Capital Projects GHG Evaluation Flowchart

Early ProjectScoping Stage

Evaluateimpact of GHG

emissions

GHG analysis integral to early examination of

alternatives

GHG analysis of key project alternatives

LessonslearnedLook back

“Small”

“Medium”“Large”

Detailed GHG analysis of

chosen alternative

Capture GHG learnings and

improved processes

“Minimal”

DocumentAnalysisresults

No GHG analysis required

Bridging to a New Energy Business Model Bridging to a New Energy Bridging to a New Energy Business Model Business Model

From short-term to sustainable approaches– Focus on effective resource utilization– Potential shifts in corporate portfolios

Oil to gas to renewables? – Simultaneous creation of economic,

human, and environmental capitalE.g. Close integration of social and environmental programs with new project development

From shortFrom short--term to sustainable term to sustainable approachesapproaches–– Focus on effective resource utilizationFocus on effective resource utilization–– Potential shifts in corporate portfoliosPotential shifts in corporate portfolios

Oil to gas to renewables? Oil to gas to renewables? –– Simultaneous creation of economic, Simultaneous creation of economic,

human, and environmental capitalhuman, and environmental capitalE.g. Close integration of social and E.g. Close integration of social and environmental programs with new environmental programs with new project developmentproject development

Technical Capability Bridge I. From Complicated to Complex(after Kastenberg, UC Berkeley)

Technical Capability Bridge I. Technical Capability Bridge I. From Complicated to ComplexFrom Complicated to Complex(after (after KastenbergKastenberg, UC Berkeley), UC Berkeley)

Complicated

Knowledge of physical worldE.g. Rate of change of atmospheric CO2

Unambiguous and observable effect or output

Local, observable,slow or reversible

ComplicatedComplicated

Knowledge of physical Knowledge of physical worldworldE.g. Rate of change of E.g. Rate of change of atmospheric CO2atmospheric CO2

Unambiguous and Unambiguous and observable effect or observable effect or outputoutput

Local, observable,Local, observable,slow or reversibleslow or reversible

Complex

Chaotic or indeterminatenature of problemE.g. Climate response to

CO2 level

Ambiguous effects,outputs

Regional/global, hard to measure, long term or irreversible

ComplexComplex

Chaotic or indeterminateChaotic or indeterminatenature of problemnature of problemE.g. Climate response to E.g. Climate response to

CO2 levelCO2 level

Ambiguous effects,Ambiguous effects,outputsoutputs

Regional/global, hard to Regional/global, hard to measure, long term or measure, long term or irreversibleirreversible

Uncertainty Uncertainty

AmbiguityAmbiguity

SocietalSocietalImpactImpact

Technical Capability Bridge II. Role ChangesTechnical Capability Bridge II. Technical Capability Bridge II. Role ChangesRole Changes

Engineers/technical contributors– Need to be partners in process vs isolated– Need global knowledge; appreciation of

regional, cultural concerns, approaches and priorities

Suggests changes in engineering curricula to expand skills of engineer– E.g. training to manage shift in application

arena to developing country focusEngineers Without Borders approach

Engineers/technical contributorsEngineers/technical contributors–– Need to be partners in process vs Need to be partners in process vs isolatedisolated–– Need global knowledge; appreciation of Need global knowledge; appreciation of

regional, cultural concerns, approaches regional, cultural concerns, approaches and prioritiesand priorities

Suggests changes in engineering curricula to Suggests changes in engineering curricula to expand skills of engineerexpand skills of engineer–– E.g. training to manage shift in application E.g. training to manage shift in application

arena arena to developing country focusto developing country focusEngineers Without Borders approachEngineers Without Borders approach

Call for a different Engineer?Call for a different Engineer?Call for a different Engineer?

Need to consider other cultures, other approaches, other ethics and values

– Huston Smith Importance of pre-modern ‘traditional’ approaches

– ‘participation’ vs ‘control’ – intuitive vs reductionist– broad vs narrow view

– Dalai Lama Need for ‘engineering heart’

By any model, role changing– from engineering to ‘ecogenuity’?

Need to consider other cultures, other Need to consider other cultures, other approaches, other ethics and valuesapproaches, other ethics and values

–– Huston Smith Huston Smith Importance of preImportance of pre--modern ‘traditional’ modern ‘traditional’ approachesapproaches

–– ‘participation’ vs ‘control’ ‘participation’ vs ‘control’ –– intuitive vs intuitive vs reductionistreductionist–– broad vs narrow viewbroad vs narrow view

–– Dalai Lama Dalai Lama Need for ‘engineering heart’ Need for ‘engineering heart’

By any model, role changingBy any model, role changing–– from engineering to ‘from engineering to ‘ecogenuityecogenuity’?’?

Bridging to a Reduced Carbon Energy FutureBridging to a Reduced Carbon Bridging to a Reduced Carbon Energy FutureEnergy FutureHydrocarbons a likely part of the solution– Strong role for gas

Key opportunities in developing regions and power generationSome immediate GHG reduction opportunities– Flaring example– Growing capture and storage

Hydrocarbons a likely part of the Hydrocarbons a likely part of the solutionsolution–– Strong role for gasStrong role for gas

Key opportunities in developing Key opportunities in developing regions and power generationregions and power generationSome immediate GHG reduction Some immediate GHG reduction opportunitiesopportunities–– Flaring exampleFlaring example–– Growing capture and storageGrowing capture and storage

Bridging to a Reduced Carbon Energy FutureBridging to a Reduced Carbon Bridging to a Reduced Carbon Energy FutureEnergy Future

Need for new governmental and business approaches– Think global– Think long-term

Need for new engineers to address complex global scale issues

Need for new governmental and Need for new governmental and business approachesbusiness approaches–– Think globalThink global–– Think longThink long--termterm

Need for new engineers to address Need for new engineers to address complex global scale issuescomplex global scale issues

Stay Inspired…Stay Inspired…Stay Inspired…

“When you are inspired by some great purpose, some extraordinary project, all your thoughts break their bonds, your mind transcends limitations, your consciousness expands in every direction, and you find yourself in a new, great and wonderful world.

Dormant forces, faculties and talents become alive, and you discover yourself to be a greater person by far than you ever dreamed yourself to be.”

Pantajali, First to Third Century BC

“When you are inspired by some great purpose, “When you are inspired by some great purpose, some extraordinary project, all your some extraordinary project, all your thoughts break their bonds, your mind thoughts break their bonds, your mind transcends limitations, your consciousness transcends limitations, your consciousness expands in every direction, and you find expands in every direction, and you find yourself in a new, great and wonderful yourself in a new, great and wonderful world.world.

Dormant forces, faculties and talents become Dormant forces, faculties and talents become alive, and you discover yourself to be a alive, and you discover yourself to be a greater person by far than you ever dreamed greater person by far than you ever dreamed yourself to be.”yourself to be.”

PantajaliPantajali, First to Third Century BC, First to Third Century BC

Be Patient…Be Patient…

“Do not be desirous of having things done quickly. Do not look at small advantages.

Desire to have things done quickly prevents their being done thoroughly (or well).

Looking at small advantages prevents great affairs from being accomplished.”

Confucius, 551 – 479 BC

“Do not be desirous of having “Do not be desirous of having things done quickly. Do things done quickly. Do not look at small not look at small advantages.advantages.

Desire to have things done Desire to have things done quickly prevents their quickly prevents their being done thoroughly (or being done thoroughly (or well).well).

Looking at small advantages Looking at small advantages prevents great affairs from prevents great affairs from being accomplished.”being accomplished.”

Confucius, 551 Confucius, 551 –– 479 BC479 BC

Keep reaching higher.Keep reaching higher.Keep reaching higher.

“The greater danger for most of us is not that our aim is too high and we miss it…

but that it is too low, and we reach it.”

Michelangelo15th-16th C. AD

“The greater danger for “The greater danger for most of us is not that most of us is not that our aim is too high and our aim is too high and we miss it…we miss it…

but that it is too low, but that it is too low, and we reach it.”and we reach it.”

MichelangeloMichelangelo1515thth--1616thth C. ADC. AD