The importance of net energy

Michael Carbajales-Dale

GCEP Net Energy Analysis Workshop March 31st 2015

Co-authors: Charles Barnhart, Adam Brandt, Sally Benson

What is the purpose of the economy?

2

What is the purpose of the economy?

3 http://steadystate.org/an-economics-fit-for-purpose-in-a-finite-world/

The traditional model of economics

4

Economy (Production)

Society (Consumption)

factors of production

goods & services

spending

income

Price

Price

Biosphere

Heun, Carbajales-Dale, Haney (2015) Beyond GDP: National Accounting in the Age of Resource Depletion, Springer

Bringing energy into the picture

5

Economy (Production)

Society (Consumption)

factors of production

goods & services

spending

income

Price

Price

Biosphere

Ene

rgy

Res

ourc

es

Heun, Carbajales-Dale, Haney (2015) Beyond GDP: National Accounting in the Age of Resource Depletion, Springer

A model that obeys thermodynamics

6

Economy (Production)

Society (Consumption)

factors of production

goods & services

spending

income

Price

Price

Biosphere

Mat

eria

l & E

nerg

y R

esou

rces

Mat

eria

l & E

nerg

y W

aste

Mat

eria

l &

Ene

rgy

Was

te

Heun, Carbajales-Dale, Haney (2015) Beyond GDP: National Accounting in the Age of Resource Depletion, Springer

What is net energy?

You have to spend energy to make energy

7 Carbajales-Dale et al. (2014) Nature Climate Change, 4(7), 524-527.

What is net energy?

8

Energy sector

What is net energy?

9

Energy sector Gross energy

What is net energy?

10

Energy sector Gross energy

Self-consumption

Net energy

What is net energy?

11

Energy sector Gross energy

Self-consumption

Net energy

What happens as self-consumption increases?

12

Energy sector Gross energy

Self-consumption

Impacts of net energy analysis (NEA)

1. Energy and the economy

2. Early technology appraisal

3. Environmental impacts of energy extraction and use

4. Managing the energy transition

13

1. Energy and the economy The availability of energy fuels economic

processes and economic growth

The energy sector must supply an energy surplus to the rest of the economy

The cost share of energy can cause disruption to the economy

Rapidly growing energy industries can run an energy deficit 14

1. Energy and the economy

15 http://www.ssb-foundation.com/photos/SSB-DEGINFO.jpg

Dale & Benson (2013) Environmental Science & Technology, 47(7) 3482-3489

1. Energy and the economy

16

2. Early technology appraisal Nascent technologies (low TRL) often have highly

uncertain economics

In particular when considering development of new materials, new production processes or translating lab-scale prototypes to commercial

production.

Net energy analysis (NEA) can identify potential costs and barriers to technology development

17

2. Early technology appraisal

18 Barnhart & Benson, Energy & Environmental Science 6.4 (2013): 1083-1092

3. Environmental impacts

19

Impacts from primary energy extraction scale with total energy consumption

Energy production pathways with lower energy inputs help reduce environmental impacts

Every unit of energy consumed within the energy sector acts as a multiplier that increases environmental impacts

3. Environmental impacts Photovoltaic (PV) CO2 emissions vs. energy cost

20 Sherwani et al.(2010) Renewable and Sustainable Energy Reviews 14, 1

4. Managing the energy transition NEA allows quantitative comparisons of the

energetic performance of various transition pathways What are the most favorable pathways for an

energy transition? How does growth of new energy technologies

impact the global energy system? What should be done with excess, renewably

generated electricity? 21

4. Managing the energy transition

22 Carbajales-Dale, Barnhart & Benson. Energy & Environmental Science 7(5) 1538-1544.

Indicators drive actions

23

Indicators drive actions

24

Indicators drive actions

25

1. Energy and the economy Matt Heun, Calvin College

Energy in macroeconomic growth models

Carey King, Energy Institute UT Austin Energy input-output and economy-wide EROI

Simon Roberts, ARUP UK

The energy-economy system

26

2. Early technology appraisal Matt Pellow, GCEP

Energy storage in hydrogen

Pei Zhai, Northeastern University Solar hydrogen generation

Marco Raugei, Oxford Brookes University

Photovoltaics systems

27

3. Environmental impacts Adam Brandt, Stanford University

Unconventional fossil fuels

Garvin Heath, NREL Electricity generation

Carey King, Energy Institute UT Austin

Water

28

4. Managing the energy transition Charles Barnhart, Western Washington

University Energy storage and transmission

Michael Carbajales-Dale, Clemson University

Fueling the energy transition

Trieu Mai, NREL Future energy scenarios

29

The importance of net energyWhat is the purpose of the economy?What is the purpose of the economy?The traditional model of economicsBringing energy into the pictureA model that obeys thermodynamicsWhat is net energy?What is net energy? What is net energy? What is net energy? What is net energy? What happens as self-consumption increases? Impacts of net energy analysis (NEA)1. Energy and the economy1. Energy and the economy1. Energy and the economy2. Early technology appraisal2. Early technology appraisal3. Environmental impacts3. Environmental impacts4. Managing the energy transition4. Managing the energy transitionIndicators drive actionsIndicators drive actionsIndicators drive actions1. Energy and the economy2. Early technology appraisal3. Environmental impacts4. Managing the energy transition