For over 20 years, eDecisions has provided management consulting services to a variety of industries in the energy sector, including oil and gas, utilities, green energy solutions, electricity management and energy modelling.
With decades of public demand for energy efficiency and pollution reduction, the energy sector is beginning a number of transformations.
Transform for Carbon to Non-Carbon
The first transformation is from carbon based energy production (electricity and thermal) to non-carbon based solutions such as wind, solar, hydro, geothermal and nuclear. However, wind and solar solutions depend on climate factors that cannot be controlled making it hard to predict when these solutions will be producing electricity. As a result, the regulators need to keep traditional generation facilities on line which some argue does not then reduce our total carbon output.
Geothermal presents a solution that has very limited carbon output for those regions where geothermal energy is abundant.
Nuclear energy provides very large scale electricity generation capacity but has environmental issues with waste disposal and safety issues with global terrorism.
For those regions rich in water supplies and favourable topography, hydro dams provide a very clean source of electricity.
Transform from Centralized to Decentralized
The current electricity generation facilities were designed and built based on a centralized model. A few very large scale facilities (coal, gas, hydro, nuclear) generate electricity in remote areas which is then transmitted to consumers over high power transmission lines. The challenge with centralized hydrocarbon based generation facilities is that only 23% of the input energy is used by the consumer. The rest is wasted as heat and transmission losses.
By moving the electricity/heat generation to the point of consumption, the efficiency (energy consumed divided by energy input) improves to 85% or more. Further, with distributed generation, there is much greater energy security.
Utilities are recognizing this transformation from centralized generation to decentralized generation and are taking steps to offer solutions such as combined heat and power (CHP).
The challenge with distributed generation is the current legislation which supported the needs of centralized generation. Currently it is not possible for a single facility (say a CHP) to provide electricity and heat to more than one building. Legislative changes may be harder than the technical challenges.
A Transformation Approach
Those regions that generate some of their electricity with hydrocarbons (Alberta, Saskatchewan, Ontario) are now challenged to find alternative generation solutions. A move to nuclear is politically charged and is not likely in the short term. Geothermal is not economic at large scales, and solar/wind solutions are still expensive.
It is clear that the best way to reduce carbon-based electricity generation is to reduce the waste in our current generation/distribution model and move to decentralized and efficient generation.
CHP’s provide a well-proven solution for decentralized facilities. Although this still uses hydrocarbon sources (gas, propane, diesel), the efficiency is much higher compared to centralized facilities. A Smart CHP can be controlled to ramp up and down based on consumer demand and is not dependent on external factors such as the weather.
CHP’s may be the solution that provides us with the time to figure out the complexities of pure-green technologies. A first step on the journey.