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Pre-Submitted + Webcast Viewer Questions Answers from Richard E. Williams P.E., President, Shell WindEnergy, Inc
ELECTRICITY QUESTION: Which cutting edge science efforts have the most promise for exciting breakthroughs, to make electricity cheap and plentiful? WILLIAMS:There are a number of solutions underway to generate electricity more efficiently and affordably such as super conductors and micro generation. However, for any breakthrough effort to be sustainable, we must include an expanded and updated infrastructure as a critical component for success. QUESTION: GM is hyping the new 300+MPG electric VOLT car about to hit the market next year. Do you see the electric cars being successful and if so, will they impact the amount of electricity our power plants will have to produce? WILLIAMS:Yes, I do see electric cars being successful if they are able to gain ground with consumers. As of now, electric cars have no impact to electricity production rates. QUESTION: How do we get sustainable electricity delivery systems with wind power in the mix - OR - what do you do when the wind stops? WILLIAMS:In order to have any sort of sustainable wind powered electricity delivery systems, we will need to ensure wind power is combined with solar or some other electricity source and install large capacity storage. QUESTION: Is hydrogen really practical? WILLIAMS:Shell believes that clusters of hydrogen filling stations will play an important role in bridging the gap between hydrogen demonstration projects and commercialization. In the U.S., we are focusing our efforts on the New York and Los Angeles metropolitan areas and have added two new demonstration projects in White Plains, NY and Los Angeles, CA to the four demonstration projects around the world that are already in place: Washington D.C.; Reykjavik, Iceland; Tokyo, Japan; and Shanghai, China. QUESTION: Do you think that hydrogen will be the penultimate clean transportation fuel of the future? Will the U.S. Government ever get behind hydrogen and fuel cell vehicles again? WILLIAMS:While it’s hard to say what the penultimate fuel of the future will be – and, it’s likely that there may be more than one hydrogen fuel is as safe as other fuels used in vehicles today and is not harmful to the environment: it is non-toxic, non-carcinogenic and cannot contaminate groundwater or air. Hydrogen fuel cell vehicles (FCVs) give off just water vapor and heat, so local emissions produced by the vehicle are zero. Hydrogen FCVs are more efficient (40%-60%) than internal combustion engines fueled by gasoline (≈30%). QUESTION: If clean energy (wind, solar, hydro, etc.) generated in remote areas was stored and transported as hydrogen, would it be more cost effective than building new transmission lines, for example, from North Dakota's wind farms to Chicago and Minneapolis? WILLIAMS:This is an interesting idea; however the main issue – other than the cost to convert the source energy to hydrogen – is the issue of lack of existing/updated infrastructure to transport the energy. QUESTION: Is hydrogen ever going to be a viable energy source? If so, how long before it will be cost competitive? WILLIAMS:Our aim is to provide hydrogen at a price comparable to existing fuels within the next 10 - 20 years, when mass production of fuel cell vehicles is expected to begin. Hydrogen is dispensed by the kilogram (kg) and not the gallon. A kg of hydrogen in an FCV is about twice as efficient as a gallon of gas in an internal combustion engine and it is estimated the market price for each kg would be about twice the cost of a gallon of gas. One reason why we expect hydrogen to be cost competitive with current fuels is that it can be made from so many sources, including natural gas, solar and hydropower, whereas gasoline and diesel are currently dependent on crude oil. Future prices are likely to follow market economies in the same way conventional fuels do. The cost of hydrogen still needs to decrease in order to become competitive with conventional fuels. This is not something one company can accomplish on its own. It will require the cooperation of energy companies, policymakers and car manufacturers to achieve this. QUESTION: Is there a meaningful role for Hydrogen in the New Energy Future? If so, what and why? WILLIAMS:Because hydrogen can be obtained from many sources, it provides for energy diversity, offering greater energy security. However, today, 95% of hydrogen is produced from natural gas at refineries and has lower “well-to-wheel” CO2 emissions than gasoline but is not “green.” If the environmental benefits of hydrogen are to be realized, hydrogen must be produced with a low or even zero CO2 footprints. Shell Hydrogen is doing some research on producing CO2 neutral or “green” hydrogen, partnering with Virent Energy Systems on technology that could produce hydrogen from renewable glycerol and sugar-based feedstocks. QUESTION: Does either speaker have knowledge of how we are going to upgrade the energy grid for future use of wind power and solar power within the states to deliver where needed , and if so what government funds are going to be made available for these projects. WILLIAMS:First and foremost, an upgrade to our energy grid must include the addition of new lines, monitoring and delivery systems to manage the combined use of wind, solar and other power within the states where it’s needed. To date, the government has already allocated $5 billion for energy grid expansion. QUESTION: Will plans for a national Smart Grid be defeated by the challenges of protecting it from terrorist activity? WILLIAMS:We believe that proper safeguards can be installed to safeguard against that threat. The bigger issue looming over the plan for a national smart grid is the challenge of coming up with a standard. QUESTION: How would residential power systems (ie solar and wind) coupled with local home based flow cells collecting excess power or buffering utility feeds benefit the smart grid. Larger commercial sized systems for business could be developed too. WILLIAMS:The smart grid is needed to help residential power systems align with larger power grids. QUESTION: Because the number of small energy producers is increasing, why not decentralize the grid? WILLIAMS:We have all come to expect reliable, uninterrupted delivery of our energy. If the grid were to be decentralized, the reliability factor would decrease significantly in that there would be many smaller parts that could fail affecting delivery of energy by the central grid. The inverse it true, however, in that if we have more small energy suppliers feeding a large central grid, the reliability factor increases. QUESTION: Solving the CO2 problem for methane and coal would be very helpful for the US and many other countries. Is there reasonable potential for this to happen? WILLIAMS:Shell has what we call the “six CO2 reduction pathways.” The first is increasing the efficiency of our existing operations. This means thinking about what we already have on the ground and using existing technologies to make that better and more efficient. The second is to establish significant carbon capture and storage (CCS) capabilities that are both safe and affordable. Right now affordability is an issue, and that is why government funding for CCS demonstration is so critical. A third is research and development to lower CO2 intensity of oil and gas production. This means stepping back to before a project is ever designed or decided upon in terms of an investment, but looking at those technologies that make the whole system less CO2-intensive to produce them. The fourth is to aggressively develop low CO2 energy sources. That includes natural gas, alternatives and renewable fuel options. Fifth is managing demand, meaning we can help our customers use energy smarter and use less energy. This one is becoming a thriving business on its own. The sixth and final pathway is working with governments to advocate effective CO2 regulations. We are working as a company to pursue these pathways and, along with many industry supporters such as USCAP, believe that a manageable carbon future is possible. QUESTION: In Barendrecht Netherlands, Shell is about to do a study on the impact of storing around 400,000 tons of CO2 annually under the ground. What are your views on the projected economic viability of this method? As a follow-up, what impact is legislation like the Carbon Capture Tax going to have on efforts like this? It appears that recent studies have shown that the carbon emitted by industry is exceedingly over exaggerated as to its direct impact to climate change. WILLIAMS:One of the most promising technologies for rapidly reducing the quantity of global CO2 emissions is carbon capture and storage (CCS). The Intergovernmental Panel on Climate Change (IPCC) has estimated the economic potential for CCS at between 10 percent and 55 percent of the total carbon mitigation effort through 2100. In fact Shell is actively involved in several CCS demonstration projects around the world, including participation in the Department of Energy’s WESTCARB project in California. The WESTCARB project is a research field test pilot program for the underground injection of CO2. For all its promise, however, CCS is a very capital-intensive process, and for that reason, we believe a sound climate change program must include policies to encourage (fund) the development and deployment of CCS technologies. We are encouraged by the inclusion of significant funding for CCS development in the Waxman-Markey bill. Similar efforts are being undertaken in the Canadian approach to climate change where, for example, in 2008 the government of Alberta alone announced a $2 billion fund available for the development of CCS projects in the province. You can learn more about Shell and CCS at http://www.shell.com/home/content/innovation/managing_emissions/reducing_co2/reducing_co2_dir_20080407.html and http://www.shell.com/home/content/responsible_energy/environment/climate_change/ QUESTION: Which technology for utility-scale (200+MW) energy storage do you feel has the greatest potential for near term commercialization? WILLIAMS:I think underground compressed air storage has the best potential for near term commercialization. QUESTION: What do you see as the most promising form of energy storage in the context of optimizing wind energy production? WILLIAMS:Compressed air storage would be the best solution for optimizing wind energy production. QUESTION: Is storage critical to the success of renewables? WILLIAMS:Since most renewables are intermittent in nature, in order to get the highest value from renewable we must have reliable storage solutions. QUESTION: While numerous technologies exist to harvest energy - solar, wind, geothermal and so on. The issue is storing this harvested energy. Kindly elaborate on what is being done to enhance energy storage - super capacitors, new battery technologies and so forth. WILLIAMS:Research has been conducted on hydropower (water), large battery, and compressed air storage solutions, however all are quite costly at this time. QUESTION: I would like to hear an insider’s view of the feasibility of spaced based solar power. WILLIAMS:While this is an interesting concept, I want to be clear that Shell believes a mix of energy sources: conventional, unconventional, renewable and alternative, will be needed to meet rising demand. Managing emissions and better energy use will help safeguard the environment and conserve resources. New energy sources and getting more from existing resources will secure energy for decades to come. So, I think that once we get that piece of the puzzle sorted, then it might be time to consider how sources such as the one you mentioned could efficiently and cost-effectively be commercialized for general consumer use; or whether the same transmission and storage issues we currently looking to overcome will become an overwhelming challenge. QUESTION: What is the opinion of the panel on the initiatives of a number of German/European companies such as Siemens to derive solar power from a huge number of sites in the North African desert (see below)? http://w1.siemens.com/press/en/presspicture/pictures-photonews/2009/pn200912.php. WILLIAMS:Together with Saint-Gobain - AVANCIS, a photovoltaic company in Germany with a total capacity of 20MWp, Shell has taken an important renewable technology from the R&D stage to the point of large-scale manufacturing, which is a small but key contribution towards helping resolve the energy challenge. And, while I have no opinion to offer on the North African project you mentioned, Arnulf Jaeger-Waldau of the European Commission's Institute for Energy has said that the capture of just 0.3 percent of the light falling on the Sahara and Middle East deserts would meet all of Europe's energy needs. However, according to an article published by The Guardian in July 2008, such a project “would take many years and huge investment to generate enough solar energy from north Africa to power Europe but envisage that by 2050 it could produce 100 GW, more than the combined electricity output from all sources in the UK, with an investment of around €450bn”. QUESTION: What are the major barriers to the development of this energy source? It isn't the technology of drilling deep. As a production engineer for Tenneco Oil Company, I have been on the site of 21,000 ft wells in the Permian Basin of west Texas, and the petroleum industry has drilled deeper than that. WILLIAMS:While Shell does not pursue activities in the area of geothermal energy, it is and has the potential to be a significant source of energy in the future. According to the U.S. Geothermal Education Office, the geothermal industry, since the 1970's, with the assistance of government research funding, has overcome many technical drilling and power plant problems. Improvements in treatment of geothermal water have overcome early problems of corrosion and scaling of pipes. Methods have been developed to remove silica from high-silica reservoirs. In some plants silica is being put to use making concrete, and H2S is converted to sulfur and sold. At power plants n the Imperial Valley of California, a facility is being constructed to extract zinc from the geothermal water for commercial sale. As a result of government-assisted research and industry experience, the cost of generating geothermal power has decreased by 25% over the past two decades. Research is currently underway to further improve exploration, drilling, reservoir, power plant and environmental technologies. Enhancing the recoverability of Earth’s heat is an important area of ongoing research. Geothermal energy is accessible if there is sufficient heat, permeability, and water in a system, and if the system is not too deep. The available heat cannot be increased, but the permeability and water content can be enhanced. Private and government research projects in the United States, Japan and in Europe are improving the accessibility of geothermal energy by developing new technology to increase the permeability of the rocks and to supplement the water in hot, water-deficient rocks. Engineers estimate that by the year 2020, man-made geothermal reservoirs could be supplying 5 to 10% of the world’s electricity. QUESTION: Geothermal appears to have such great potential without any huge unknowns; is it just sheer capital cost that prevents it from being ranked higher? WILLIAMS:The U.S. Geothermal Education Office states the competitive position [of geothermal energy] depends primarily on cost: Costs: Shorter and Longer Term. Production of fossil fuels (oil, natural gas and coal) is a relative bargain in the short term. Like many renewable resources, geothermal resources need relatively high initial investments to access the heat, hot water and steam. But the geothermal "fuel" cost is predictable and stable. Fossil fuel supplies will increase in cost as reserves are exhausted. Fossil fuel supplies can be interrupted by political disputes abroad. Renewable geothermal energy is a better long term investment. Costs: Direct and Indirect. The monetary price we pay to our natural gas and electricity suppliers, and at the gasoline pump, is our direct cost for the energy we use. But the use of energy also has indirect or external costs that are imposed on society. Examples are the huge costs of global climate change; the health effects from ground level pollution of the air; future effects of pollution of water and land; military expenditures to protect petroleum sources and supply routes; and costs of safely storing radioactive waste for generations. Geothermal energy can already compete with the direct costs of conventional fuels in some locations and is a clean, indigenous, renewable resource without hidden external costs. Public polls reveal that customers are willing to pay a little more for energy from renewable resources such as geothermal energy Costs: Domestic and Importing. Investment in the use of domestic, indigenous, renewable energy resources like geothermal energy provides jobs, expands the regional and national economies, and avoids the export of money to import fuels. Energy demand is increasing rapidly worldwide. Some energy and environmental experts predict that the growth of electricity production and direct uses of geothermal energy will be revitalized by international commitments to reduce carbon dioxide emissions to avert global climate change and by the opening of markets to competition. QUESTION: Why hasn't geothermal - especially for heating and cooling houses - caught on more? It seems this is an ideal source to reduce a carbon footprint, create jobs that can't be outsourced, and save consumers money in the long run? It seems to me that governments should be offering long term loans to support this alternative resource. WILLIAMS:Again, according to the U.S. Geothermal Education Office, the outlook for geothermal energy use depends on at least three factors: the demand for energy in general; the inventory of available geothermal resources; and the competitive position of geothermal among other energy sources. The Demand for energy will continue to grow. Economies are expanding, populations are increasing (over 2 billion people still do not have electricity), and energy-intensive technologies are spreading. All mean greater demand for energy. At the same time, there is growing global recognition of the environmental impacts of energy production and use from fossil fuel and nuclear resources. Public polls repeatedly show that most people prefer a policy of support for renewable energy. The Inventory of accessible geothermal energy is sizable. Using current technology geothermal energy from already-identified reservoirs can contribute as much as 10% of the United States energy supply. And with more exploration, the inventory can become larger. The entire world resource base of geothermal energy has been calculated in government surveys to be larger than the resource bases of coal, oil, gas and uranium combined. The geothermal resource base becomes more available as methods and technologies for accessing it are improved through research and experience. QUESTION: Dow, Exxon and others have announced significant expenditures for producing fuels from modified algae. What are the significant barriers? And if successful how will that impact imported oil and oil from the Canadian oil sands? WILLIAMS:Shell’s partnership with Cellana is a piece of the equation here. However, pricing and the issue of scaled production are the major barriers to commercialization of algae-based fuel. That being said, however, even if we’re able to overcome the pricing and production issues, I think it’s important to stress that we will require a number of diverse energy sources in the future, which will most likely include fossil fuels in many forms. QUESTION: What do you think is the best system for alternative energy? I have heard of the use of algae... is this actually viable? WILLIAMS:I think there are a number of promising sources for alternative energy including biofuels, gas-to-liquids, oil sands, coal gasification, LNG, wind and hydrogen. Algae hold great promise as a possible source of biodiesel because they grow rapidly, are rich in vegetable oil and can be cultivated in ponds of seawater, reducing the need for fertile land and fresh water. Many companies are seeking ways to produce algal oil on a commercial scale, but they face significant hurdles, not the least of which is cost. However, these hurdles must be overcome before algae-based biofuel can be produced cost-effectively in the large volumes that would be needed to make a difference in the world’s overall supply of transport fuel. To work on a large commercial scale, the process calls for huge amounts of water, which could limit where it is produced. There is no tried and tested method to harvest algae efficiently in large volumes. And research must still be done to identify the best strains for producing oil. Recent history serves as a cautionary tale to rapid commercialization of algae-based biofuel on a large scale. The 1970s’ oil crises prompted several government-funded studies into algal fuel in France, Germany, Japan and the USA, and other countries in a bid to increase energy security. But the technology was expensive and development costs were too high. The U.S. Department of energy’s Aquatic Species Program, for example, built two 1,000-square-metre open pond systems and found that algae were only economically viable as a biofuel at oil prices of more than $60 a barrel. The Clinton administration ended the program 11 years ago after spending about $25 million as low oil prices of the day made it unattractive economically. Whether algae-based fuels will thrive depends on whether the technological and commercial hurdles can be overcome. If they can, algae – one of the world’s oldest organisms – may prove a boon to the transport needs of the future. QUESTION: What is your opinion of the Traveling Wave Reactor design patented by Intellectual Ventures? Could this be the answer to nuclear waste mitigation and the path to more nuclear reactors providing electricity in the U.S.? WILLIAMS:Intellectual Ventures’ ‘Traveling Wave Reactor’ or TWR has the potential could theoretically run forever without ever needing any additional enriched uranium after its startup period according to their website. Further, Intellectual Ventures suggests a fleet [of TWRs] could supply the world’s needs for energy for thousands of years without any need for chemical reprocessing of the used fuel. We agree that nuclear energy is part of the energy mix needed to supply our collective energy futures; this solution could provide a critical source to the mix. You can learn more about this technology at http://www.intellectualventures.com/docs/terrappower/IV_Introducing%20TWR_3_6_09.pdf and http://www.technologyreview.com/energy/22114/ QUESTION: How do the speakers see nuclear energy fitting in to the new energy portfolio? WILLIAMS:In the new energy future, we will need every energy resource available, including nuclear, to help keep pace with demand that’s only projected to rise. QUESTION: What about nuclear energy plant safety? WILLIAMS:While Shell has no expertise in the area of nuclear energy, the World Nuclear Association states that in relation to nuclear power, safety is closely linked with security, and in the nuclear field also with safeguards with the following distinctions:
Further, the Association notes that from the outset, there has been a strong awareness of the potential hazard of both nuclear criticality and release of radioactive materials.
You can learn more about nuclear power plant safety at http://www.world-nuclear.org/info/inf06.html QUESTION: There have been some very optimistic projects of renewed growth in nuclear power in the U.S. (and across the globe). What is your view of the role of nuclear power in the future and the growth projections that have been published recently? WILLIAMS:We believe that nuclear energy plays a key role in ensuring we bring all forms of energy to bear in the new energy future to balance the rapid increase in demand with supply. QUESTION: Not clean per say, any comments on Fast Breeder reactors? WILLIAMS:Since Shell does not actively pursue activities in nuclear energy nor do we have expertise in that area, we really have no comment to offer other than acknowledging that in whatever form it eventually takes, nuclear energy will need to be a part of our energy mix to ensure we have sufficient supply to keep up with escalating demand. QUESTION: What are the most significant challenges to reducing petroleum dependency in the transportation sector over the next 15 years? WILLIAMS:I think changing consumer behavior from a “convenience mindset” to an “efficiency mindset” over the next 15 years is the most significant challenge facing us in making full-scale changes in the transportation sector. QUESTION: To what degree do you expect the transportation sector continue to rely on petroleum in the transportation sector for the next 25 years? WILLIAMS:We like to talk about the three hard truths in Shell: we will need diverse energy sources to meet rising demand; managing emissions and better energy use will help safeguard the environment and conserve resources; and new energy sources and getting more from existing resources will secure energy for decades to come. So, to your specific question, I expect that fossil fuels – in some form – will continue to play a large role in the transportation sector for the next 25 years. However, there are a number of promising alternatives that will help ease the load on petroleum like biofuels, natural gas, and hydrogen. QUESTION: What are the most significant barriers in the transition from the internal combustion engine to electric, PHEV, or hydrogen vehicles? WILLIAMS:I believe the most significant barriers to transition from internal combustion engines to any alternative energy-sourced engine are cost, consumer acceptance, and availability of fueling stations. QUESTION: In the transportation sector, what is the long-term outlook for the use of biofuels, compared to electricity, compared to hydrogen, etc.? WILLIAMS:We believe biofuels could grow from just 1% of the world’s transport fuel mix today to as much as 7–10% over the next few decades. Last year, we quadrupled our rate of investment in biofuels and aim to build a significant biofuels business in the next 10 years. We are building our capacity in today’s biofuels – partly to meet government mandates, but also to help us develop the know-how and market leadership needed to introduce advanced biofuels that use more sustainable feedstocks (like straw, wood or even algae) and emit even less CO2. We think commercial volumes of advanced biofuels could be on the market in five to 10 years. To get there, we are investing in partnerships (such as Iogen) targeted at technical breakthroughs and cost reducing innovations. We are also working with nongovernmental organizations (NGOs), policy makers and industry coalitions to develop and promote robust global standards for ensuring the sustainability of biofuels production. But we are also working to ensure that the feedstocks and conversion processes for the biofuels we purchase today are as sustainable as possible. QUESTION: What energy is considered for the trucking industry? WILLIAMS:I believe the trucking industry will remain primarily fuelled by diesel with possibly some blended sources. QUESTION: What is the vision for energy for aviation, both for large passenger airliners and small General Aviation aircraft? WILLIAMS:Shell is focusing more on sustainable biofuels as a promising future fuel. In fact, a number of major airlines are already testing biofuels in their aircraft including Continental, which conducted the first biofuel-powered demonstration flight of a U.S. commercial airliner on Jan. 7, 2009. The demonstration flight was powered by a special fuel blend including components derived from algae and jatropha plants - sustainable, second-generation fuel sources that don't impact food crops or water resources and don't contribute to deforestation. QUESTION: There seems to be a new bio-ethanol process popping up every week claiming it is the answer to generating enough fuel to replace fossil fuels used for transportation without unbalancing our food chain. Which one does the panel think is the most promising and why that one over the other processes? WILLIAMS:If biofuel production is to scale-up to help meet growing transport fuel demand then non-food raw materials need to be developed. This means looking at new feedstocks and new processes and fuels beyond ethanol and FAME. Shell is a leader in this research and development of next-generation biofuels. Our technology division has a dedicated bio-team working at several centers around the world and we have forged a number of partnerships, both academic and commercial, to accelerate our work. Our aim is to narrow down the technology options to a feasible set of commercial solutions. Just two examples of this program are our collaborations with Iogen and Choren:
QUESTION: What strategies is Shell pursuing to address the intermittent nature of wind energy? WILLIAMS:Since there’s not a lot we can do to increase how often the wind blows, the best strategy to cope with intermittency is storage – either underground or battery. QUESTION: Reacting to recent press about the transmission grid being a scaling limitation for wind, what prevents faster growth of middle scale projects such as community wind programs in municipal districts among others? WILLIAMS:Intermittency is a universal issue when it comes to wind projects of any size. However, for mid-scale (or smaller) projects, the ability for existing grids to absorb the power and the difficulty in recouping costs in regeneration are probably the most significant obstacles to growth. QUESTION: It seems there is a good deal of competition in the large wind turbine market, slightly less in the mid-range such as for community projects, and only recently a good deal of activity in small wind. Ignoring the physics of lower speed wind and lower elevations above land, what does the panel think prevents small wind from growing rapidly? WILLIAMS:As with mid-scale projects, small wind will have difficulty recouping costs as well as contending with the complex environmental issues, not the least of which is ‘NIMBY’ – otherwise known as Not In My Back Yard or ‘Who owns the view?’ QUESTION: What is the future for wind energy for less than 2m/s wind availability? WILLIAMS:While there is a place/need for small wind, here you’re essentially talking about enough wind to power a home. I would have to think that there would be so many issues around cost, siting, permitting, and neighbors that it just would not be sustainable. QUESTION: I understand that in Germany they are no longer building windpower generators because of the environmental pressures and the German Govt has stopped subsidies. What % of the energy needs in Germany is generated by wind power? Will this not also happen in the US and we will have to stop construction on windpower. We already have this with the Kennedys refusing to accept windpower due to environmental reasons in their area. What’s your opinion? WILLIAMS:According to the German WindEnergy Association, as of 2007 about 7 percent of Germany’s energy needs were supplied by wind energy. With a total of 25,369 MW in operation at the end of 2008 per the American Wind Energy Association, the U.S. pulled ahead of long-time leader Germany (23,902 MW) both in wind energy production and in cumulative wind power generating capacity. The U.S. is also the world’s largest market in terms of new installations (8,545 MW) added in 2008, ahead of China (6,300 MW). In general, though, I see four challenges that need to be addressed to keep wind a major player: Safety, Operational Excellence, Workforce, and Transmission. I should add that the social and political issues you referenced will continue to be challenges as well – worldwide. QUESTION: When environmental impacts are considered, replacing petroleum-based fuels with ethanol, butanol or other bio-fuels has been described as resulting in only marginal improvement and much less desirable than using electricity from wind (see study by Professor Mark Jacobson at Stanford); it would seem impossible for any oil-energy company to make the transition to such different focus; are there long-range plans in the oil sector to make such a transition? WILLIAMS:Over the last several years, Shell has undertaken a strategy to investigate a range of alternative energy and CO2 technologies. In fact, we’ve invested about $1.7 billion on alternative energy in the last five years. But clearly we don’t try to do it all. For example, we have not invested in the development of nuclear, wave or tidal power. We have, however, made serious investments in wind, biofuels, and hydrogen and in developing carbon capture technologies. I believe that you will see transitions taking place where it makes economical, social, and political sense for companies in general, not just in the energy industry. RENEWABLES/ALTERNATIVES – (GENERAL) QUESTION: Methods of evaluating the effectiveness of renewable energy technologies. WILLIAMS:At the end of the day, the effectiveness of any renewable energy technologies will be measured against a number of criteria: consumer acceptance, economics, social (includes siting and NIMBY issues) and environmental. QUESTION: How 'renewable' are these technologies? WILLIAMS:Depending on the technology, some are more ‘renewable’ than others. For example, while solar and wind power are generally classified as renewable, I believe they’re more accurately termed low-carbon impact or natural/sustainable energies. In the case of biofuels or hydrogen, these energy sources or technologies are technically alternative or future fuels. QUESTION: Rate at which technologies can realistically be deployed. WILLIAMS:Realistic deployment rates of new energy technologies really depend on a number of factors: public, government, social, storage, scalability, and infrastructure cost. QUESTION: Maturity of technologies (many are predicted to be commercially viable 'next year', every year). WILLIAMS:I can really only speak to Shell technologies, and from that perspective, wind is probably the most mature of the renewable/alternative technologies currently reaching commercial viability. I think that LNG would follow as a close second. QUESTION: How can we wean renewable energy technologies off subsidies so that market forces can be brought to bear? WILLIAMS:We will only be able to ‘wean’ renewable technologies off subsidies when the public accepts the initial increased cost of energy due to installation/infrastructure requirements. QUESTION: What can effectively and affordably reach the most consumers? WILLIAMS:In my opinion, smart grids and microgeneration can most effectively and affordably reach the most consumers. QUESTION: With the rate of technological change so rapid, how can an investment in new technologies be scaled up without taking undue risk of going down a wrong path? WILLIAMS:Using Shell as an example, we choose the technology and method that had the broadest possibility of fitting well in an existing system. But, from an energy industry perspective, I would say that there are many examples of energy opportunities – especially in the area of oil and gas exploration – where reality did not match up well with projected outcome… it’s a lot of the reason why we take such care in research and development with a realistic eye towards our core strengths. QUESTION: What is needed to make renewable energy from for example the Southwest or Dakota available on the east coast? WILLIAMS:The interstate “sharing” of energy resources depends on some physical factors such as storage and transmission, as well as a number of political factors potentially from municipal, state and federal perspectives. I think that your question really brings the need for standardization and regulation from the federal level to the forefront of the discussion. QUESTION: In ExxonMobil's "Outlook for Energy", renewable (wind, solar, and biofuels) are projected to contribute less than 10 MBDOE out of the more than 300 MBDOE needed to satisfy global energy demand in 2030. Why should we invest time and money working on alternative energy sources such as wind that will only meet 3% of our future energy needs? WILLIAMS:We believe that no matter how large or small the contribution to our overall energy resource mix, we will need it all. QUESTION: "Why we cannot use Exercising human energy to generate energy by attaching dynamos to both Stationary and regular bicycles. Many suffer from Obesity in our country and do exercise." WILLIAMS:While this is an unusual solution, I think this idea is very similar to the notion of how many [choose your rodent] hamsters are under the hood of a car spinning away on little wheels to power the car. It’s not a very sustainable idea, and there are a whole host of other issues ranging from discrimination to human rights that would come to bear. I think that a better idea is to continue research and development of renewable and alternative energy sources and look to make our existing resources more efficient and last longer. QUESTION: What will be the major problem(s) on biofuel currently? What do you see the percentage in overall energy supply for biofuel? WILLIAMS:The most pressing challenges currently facing us with regard to biofuels include the ability to scale and sustainability of feedstocks. We believe biofuels could grow from just 1% of the world’s transport fuel mix today to as much as 7–10% over the next few decades. We are building our capacity in today’s biofuels – partly to meet government mandates, but also to help us develop the know-how and market leadership needed to introduce advanced biofuels that use more sustainable feedstocks (like straw, wood or even algae) and emit even less CO2. We think commercial volumes of advanced biofuels could be on the market in five to 10 years. To get there, we are investing in partnerships (such as Iogen) targeted at technical breakthroughs and cost reducing innovations. We are also working with nongovernmental organizations (NGOs), policy makers and industry coalitions to develop and promote robust global standards for ensuring the sustainability of biofuels production. But we are also working to ensure that the feedstocks and conversion processes for the biofuels we purchase today are as sustainable as possible. QUESTION: Why don't we run our cars on natural gas? WILLIAMS:There are a number of cities that run their metro systems on natural gas powered vehicles such as El Paso, Texas and Santa Cruz, California. Additionally, many city vehicles – including the City of Houston – boast fleets of natural gas powered vehicles. Last, but not least, there are natural gas conversion kits for consumer vehicles and resources available for consumers to locate fueling stations that include natural gas bays. QUESTION: What about converting coal to natural gas? WILLIAMS:Major economies such as the United States, China and India are turning to coal gasification technology to unlock the value of their vast coal reserves more cleanly and to reduce their dependency on energy imports that are often more expensive. Coal is the world’s most abundant fossil fuel, with estimated reserves of almost 1 trillion tons. Shell technology can now turn virtually any coal – even the lowest, dirtiest grades – into synthesis gas, a mixture of hydrogen and carbon monoxide that burns as cleanly as natural gas. Synthesis gas has a direct market value because it can be used to produce a wide range of high-value products such as electricity, fertilizers, transport fuels and chemicals. You can learn more about Shell and coal gasification at http://www.shell.com/home/content/innovation/managing_emissions/getting_cleaner/gasification/coal_gasification.html QUESTION: Is there really a path to meeting instantaneous power demand and quality with just wind and solar? Or will gas and perhaps biofuels necessarily have to be a part of the mix? WILLIAMS:In order to achieve a level of sustainable, available, affordable, clean energy for the future, we need to come to terms with the fact that we will need a diverse range of energy sources to get us there. A point I would like to make here is that even in our current economic downturn, the demand for energy is growing and, according to many, will double by mid-century. In order to meet that demand it will be necessary to responsibly develop all forms of energy at our disposal – including solar, wind, natural gas, biofuels – and the fossil fuels that will continue to play a large role in our energy mix for many years to come. QUESTION: Where can Government Policy help shape the direction and focus to get Wind Energy, Biofuels, Solar etc to get scaled up to the point it's a peer to Coal, Natural Gas and Nuclear? Would a "Cash for Clunkers" type program for Home Based Solar be significant enough to boost the industry? Same for Wind. WILLIAMS:Government policy needs to set market price or the expectation/recognition that energies such as wind, biofuels and solar have similar value – as viable energy resources and as market driven energy commodities – as coal and natural gas. QUESTION: What role should education play in this new energy future? How should or will the teaching of STEM (Science, Technology, Engineering and Math) across grade levels and curriculum be handled to include energy literacy? WILLIAMS:The role of energy education in the New Energy Future should not be under-estimated in helping young people and families open their minds to what it will take to realize a low-carbon future. Shell has been very active in this area - from working with education specialists, non-profit organizations and museums to providing online and in-classroom activities, curriculum and energy information for both educators and students for middle school through high school students (www.shell.us/energizeyourfuture). Shell Eco-marathon is an educational platform for high school and college students that encourages innovation, reinforces conservation and fosters the development of leading technology for greater energy efficiency by challenging student teams from around the world to design and build the world’s most fuel-efficient vehicle - and produce the fewest emissions. Students can use either conventional fuels (such as diesel, gasoline and LPG), or alternative fuels (such as solar, electric, hydrogen, bio-fuels and GTL) can be used to power vehicles. The goal of the project is not to break speed records or be the first to finish; it is to consume as little fuel as possible over a set distance. It is a major educational project, in which students work together to explore potential solutions to both current and future transport and energy challenges. You can learn more about the Shell Eco-marathon at www.shell.com/ecomarathon QUESTION: There are trade offs for various energy types, especially financial. When calculating those costs, do companies and our government factor in Subsidies? Basically stated - is a 42 gallon of Crude Oil actually the market price quoted or is there an add-on cost that can be determined? This question applies to all Energy Sources. WILLIAMS:The energy equation is financially complicated. It has to take into account life-cycle, transmission tariffs, and taxes to name a few considerations. With regard to the cost of a gallon (or a barrel) of crude oil – what you see quoted as market price in the U.S. includes is the actual market cost of crude oil. When it is “converted” into gasoline, the price of a gallon of gas at the pump includes the cost for manufacturing and retailing, and taxes. QUESTION: We seem to be very bad at predicting "unintended consequences" that result from distorting the market with energy subsidies/incentives (see methanol from corn). What can we do in the future to better predict outcomes and still encourage alternate energy sources? WILLIAMS:I think that all we can do is carefully examine the past – especially where the actual outcome did not meet expectations – open our minds to alternative solutions and be as thorough in our planning as possible. QUESTION: How do we energize Sub-Saharan Africa to increase their standard of living so they can live? WILLIAMS:I believe that while we can assist in the installation of energy solutions that will raise their standard of living such as microgeneration (decentralized) energy opportunities; we need to build a structured training program that increases localized technical knowledge and decreases or ends the need for outside assistance. |
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 Massachusetts Institute of Technology |
