POWER INDUSTRY TRENDS 2020

By Rami Reshef, CEO, GenCell Energy

ENERGYCENTRAL - As we look ahead to the coming year and the start of a new decade, what trends do we see at the forefront of the energy industry? What challenges will we face and how can we overcome them?

Battling Climate Crisis

When we ask ourselves, what are the most important issues facing the industry in 2020, of course the top of the list is climate action, as we work to minimize if not eliminate the greenhouse gas emissions that are causing havoc with global temperatures and weather conditions.

The world’s climate experts are in agreement that the world must take urgent action to reduce carbon emissions, and much of this action falls on the energy sector. Ultimately, we must reach “net zero” emissions, meaning that humanity must remove as much carbon from the atmosphere as we emit each year. To achieve this tough goal, we will need aggressive new approaches to energy generation and storage, perhaps new technologies that don’t even exist today, alongside bold and innovative public policy.  We know that this is an ambitious and daring goal, but climate scientists are increasingly certain that achieving this goal will be of fundamental importance to every person alive today, as well as for the generations that will follow.

Infrastructure to Fuel EVs

Looking more specifically at the key challenges facing our power utilities infrastructure, there is no question that the steeply rising demand to power and recharge electric vehicles -  and especially fuel cell electric vehicles – will place strong pressure on grid capacity to be able to concurrently meet the heavy power requirements of multiple electrical vehicles.  With high-profile new vehicles and programs promoted by all the major car manufacturers, FCEVs are already moving to the mainstream. This means that in parallel we will need to come up with adequate fueling infrastructure to power these vehicles.  Building a hydrogen infrastructure to generate the fuel for these vehicles will have an enormous financial cost and take many years to complete, but with the broad commitment to its achievement, we will see more and more progress through the decade.

Competition between Renewables – a Window of Opportunity for Wind

Looking to 2020 and ahead, we foresee ever stronger price competition between energy sources, not only between the renewable energy newcomers versus fossil fuel incumbents, but also between the different sources of renewable power, from various solar energy sources to hydropower, from wind turbines to biofuels. And this “internal” competition within the energy sector is only intensifying.  With more alternatives entering the market every day, the cost of renewables will continue to fall. Leading global corporations together with the companies along their supply chains taking action to transition to renewables and reduce carbon emissions will continue to grow the renewables market. Governments at every level are heeding the urgent call to accelerate the uptake of clean energy. All of these factors will continue to drive down the levelized cost of energy and bring the world to grid parity.

Within the renewable energy sector, in comparison to other technologies, there appears to be a growing window of opportunities for the wind turbines market, in particular in Europe and in the U.S. From a regulatory perspective, wind turbines appear to be advantageous over other energy sources.  As the wind turbine segment did not grow as rapidly as did others over the last 5-6 years, it seems to now be catching up. With technological maturity that enables more powerful and taller wind turbines, these projects will continue to grow in scale.  

The Need for Energy Storage

The biggest issue for renewable energy is no doubt the need to balance intermittent renewable energy sources with sufficient energy storage to maintain grid stability. In contrast to the constant combustion of fossil fuels that ensures very stable power supplies, renewable energy generation fluctuates at different hours and in different weather conditions. This creates serious challenges for utilities, as illustrated in the famous “solar duck curve” caused by the mismatch of a strong surplus of renewables during midday hours, when market demand for electricity tends to be lower, and low renewable power supplies in the evening hours when demands for electricity tend to be high.  

The approach to providing carbon-free energy storage solutions to balance against intermittent renewable energy sources focuses primarily on batteries and fuel cells. Varied technologies are used to develop rechargeable batteries of different types and sizes.  The advantages of batteries include energy efficiency, long lifespan thanks to charging and transportability. On the other hand, their disadvantages include high production costs, deterioration and safety hazards.  In parallel to batteries, fuel cells of different types are gaining traction and interest, and among these, fuel cells that run on hydrogen are commanding greater budgets and applications for diverse applications, both stationary and mobile. With the Hydrogen Council and government support around the world, the hydrogen economy is advancing in academic and commercial projects across all industry sectors.  Energy storage utilizing hydrogen is challenging. Building a viable hydrogen infrastructure for delivery from production to consumption sites is not a simple matter.  When hydrogen gas or liquid is produced in large volume in a central location it entails high delivery and distribution costs, and at the same time low-volume distributed production is prohibitively costly. Delivering hydrogen is no easy task, involving high costs, energy efficiency losses in transit, hydrogen purity issues and propensity for leakage.  With the huge interest in making hydrogen viable, different solutions to overcome these challenges are coming to market around the world with different pros and cons.  

Ammonia as an Energy Carrier

One interesting avenue is to use ammonia as a hydrogen carrier. The advantages are many. Firstly, ammonia is economical. Availability – the second most widely produced chemical in the world, 200 million tons of ammonia are produced per year. Transportability – ammonia is easy to store and doesn’t require high-pressure storage. Another key advantage is ammonia’s chemical compatibility with alkaline fuel cells. And when ammonia is cracked to produce hydrogen, no harmful pollutants are emitted.  As there is no carbon, no carbon by-products are produced – so ammonia is carbon-neutral.  While ammonia is a toxic chemical with a potent odor, when handled with care and in accordance with regulations, it is safely used in agriculture, refrigeration, semiconductors, hair dyes and water purification among other applications. But the biggest advantage of ammonia as a hydrogen carrier, is the fact that as a liquid, with mild pressurization and without cryogenic constraints, it offers high hydrogen storage density.  This makes ammonia especially viable for mass energy storage needs.

Our Predictions: The Decade of the Fuel Cell

With a reported increase of 40% in 2019 over 2018 and the achievement of a 1 GW capacity, the 2020s have been heralded as the era in which we will see the ascendancy of the fuel cell, during which the technology will achieve rapid commercialization and infrastructure build out. Not only are they being adopted for means of transport of every type – air, rail, car, truck, ship, bus and more – fuel cells are enabling diverse stationary applications, serving a wide range of markets including retail, data centers, residential, telecommunications, and many more. These applications can offer a primary power source or supplemental power as well as in hybrid power systems with photovoltaics, batteries, capacitors, or wind turbines, providing primary or secondary power. And fuel cells are an exceptionally reliable source of backup power during power outages. With climate crisis forcing the energy industry to make dramatic changes to our infrastructure and at the same time continue to meet consumers’ growing energy needs, fuel cells will prove to be an important factor in the equation.

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This thought leadership article was originally shared with Energy Central's Energy Collective Group. The communities are a place where professionals in the power industry can share, learn and connect in a collaborative environment. Join the Energy Collective Group today and learn from others who work in the industry. 

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