Technology in a Carbon Constrained World

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Technology in a Carbon Constrained World

• Arnulf Grübler
• gruebler_at_iiasa.ac.at
• SHELL Workshop, London
• September 19-21, 2000

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Part I Technology and Global Change

• The powers of technology
• Basics of Technological Change III
• Examples for characteristics of TC
  dynamic (DRAMS)
• systemic (H2 systems)
• cumulative (PVs)
• uncertain (smoke-spark arrestors)
• Hierarchies and rates of change

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Factors of Growth The Last 200 Years
1800
2000
factor
World population,
1
6
x 6
billion
Life expectancy, years
35
75
x 2
Work hours per year
3,000
1,500
?
2
Free time over life
70,000
300,000
x 4
Mobility, km/day
0.04
40
x 1000

(excl. walk)
World income, trillion
0.5
36
x 70
Global energy use, Gtoe
0.3
10
x 35
Carbon, energy, GtC
0.3
6
x 22
Carbon, all sources,
0.8
8
x 10
GtC
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Dimensions of Global Change AD 2000
Land
Water
Materials
Energy Carbon
Net source sink
6
2
3
9
3

10
km
km
10
t
10
EJ GtC
Human
47
3.000
lt140
0.4
lt9
7
Natural
84
10.000
lt25
5440
600
--2
as
56
30
560
0.01
1
300
Land - use vs. availability Water - use vs.
surface water runoff Materials - total materials
used (40 Gt) and moved (100 Gt) vs. material
transported by rivers Energy - global primary
energy use vs. solar influx Carbon - sum of
annual exchanges between reservoirs
(bi-directional) vs. gross emissions Source
Turner et al., 1990 IPCC, 1996 Grübler, 1998.
c\leoben\global_change_shell.doc
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• Technology HSO hardware software
  orgware
• Most important single factor of productivity and
  economic growth
• Source and remedy of adverse impacts
• Hierarchical levels of change (increasing size
  slower diffusion)

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Basics of Technological Change II Change is..

• Dynamic importance of both incremental and
  radical change (e.g. DRAMS)
• Systemic importance of spillovers, clusters, and
  systems architecture (e.g. H2 system)
• Cumulative increasing returns learning by
  doing, but forgetting by not doing (e.g. PVs)
• Uncertain risk, but resilience through diversity
  and experimentation (e.g. unsuccessful smoke
  spark arrestors for steam locomotives)

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DRAMs

• Key technology for increased computing
  performance
• Market size 30 billion
• Moores Law holds for gt30 years
  (self-fulfilling prophecy)
• Density doubles every 18-21 months
  1kB to 1GB x106
• Cost decline (/bit) a factor gt100,000 !

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DRAMS Memory Size
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DRAMS Prices
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A Possible H2 System
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Japan - PV Costs vs. Expenditures
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Technological Uncertainty Patented but
non-functional smoke-spark arrestors
Source Basalla, 1988.
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Hierarchy of Technological Change

• Technology Hardware, Software, Orgware
• Incremental (H)
• Radical (Hn S)
• Systems (Hn Sn O)
• Clusters Families (Hn Sn On)
• With increasing hierarchy (complexity)
• larger market size, but slower diffusion.

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Hierarchies in Rates of Change
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Part II The GHG Economy Challenges and
Opportunities

• Challenges (e.g. unknown targets)
• Opportunities (e.g. continue decarbonization)
• Opportunities along hierarchy of TC
• An example Towngas strategy
• Implications for SHELL

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Challenges

• Uncertain targets long-term unknown
  short-term not arguable
• No easy fix pervasiveness of emissions
  (agriculture, energy, industry, land use, sewers,
  etc.)
• Extreme long time horizon gt100 yrs (act and see
  rather than see and act, mismatch between rhythms
  of climate change, socio-economic change, and
  politics)
• Externality not quantified (no binding targets
  no price future (ecosystems) damages not
  quantifiable damages lt than costs with
  discounting dilemma between intra- and
  inter-generational equity)
• Institutional settings not yet existing (rules
  of the game?, who decides?) with contradictory
  interests (global -- national dominant --
  emerging business)

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Uncertainties in Stabilizing Climate at 2.5 ºC
by 2100
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Opportunities

• External support for development of new
  technologies, businesses, industries
• Innovation trigger (technologies, organizations,
  institutions)
• Move with, and shape social tide (PR, avoid
  worse e.g. hefty C-tax)
• Continue historical path of decarbonization
  (wood?coal?oil?gas? hydrogen)
• New business (revenues and profits) from
• --new products (e.g. fuel cells,
  carbon-buckyball structures, CO2 turbines)
• --new markets (e.g. CO2 sequestration storage,
  towngas CH4 H2)
• --new industries (e.g. C as structural
  manufacturing material, H2 economy)

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World Primary Energy Supply
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World Primary Energy Shares
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Decarbonization of Global Energy
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Hierarchies of ChangeT HSO

• Incremental (H) e.g. CO2 capture from CO2-rich
  gas reinjection 3-litre car
• Radical (HnS) e.g. cheapclean recovery of
  methane hydrates CO2- turbine
• Systems change (HnSnO) e.g. CO2 market
  (sequestration transport disposal) towngas
  strategy
• Clusters, families, paradigms (HnSnOn) e.g.
  H2 economy H2 FC all energy services
  consumers utilities

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An (evolutionary) Towngas Strategy

• Location close to major transit pipelines and
  old oilfields (e.g. West Ukraine)
• Steam reforming (endothermal - gas later
  exothermal - nuclear)
• Towngas CH4 H2 (lt30)
• Transport to consumption centers in existing gas
  pipelines
• Membrane separation (H2?FC CH4?gas turbines
  (with CO2 capture)

(C. Marchetti, 1989, Int.J.Hydrog.Energy
14(8)493-506)
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Methane ? Hydrogen
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Where to start...
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Implications for SHELL

• Biggest risk customers and rules still
  undefined options involving soil carbon
  (forestry) might turn out phoney
• Biggest opportunity entirely new business areas,
  new dash for gas
• Focus short-term 1 capacity building (CO2
  trading, CDM, work with sisters, NGOs,
  governments)
• Focus short-term 2 incremental changes with
  positive (even if small) ROI efficiency
  improvements (refineries), stop flaring, monitor
  plug CH4 leaks (become world leader)
• Focus medium-term increase value of gas reserves
  (infrastructure investments) towngas strategy
• Focus long-term push decarbonization and
  hydrogen economy, explore fundamentally new
  solutions (return to RD, e.g. closed hydrate -
  H2 cycles)