Carbon Offset Costs?

This data-file tabulates the costs of carbon offsets that are being offered to consumers and commercial customers, by 17 companies. Offered carbon offset costs are surprisingly low.

Are they real? The file also tabulates 1,600 carbon offset projects which are assured by agencies such as the ‘Verified Carbon Standard’, Gold Standard and Green-E. This helps lend credibility to the companies in the data-file.

However, we estimate only c10-20% of the projects directly offset CO2 through planting new forests, another c15-30% are spent on forest conservation, and the remaining 50-70% are broader (i.e., charitable donations to finance renewable energy projects).

Battery Patents: Lithium Deflation, New Breakthroughs?

This data-file tabulates the number of patents filed into different types of batteries, by year and by geography.

Continued deflation in lithium ion battery costs is suggested by the 26,000 patents filed in 2019, which has doubled in the past 5-years, led by China (two-thirds of the patents).

Redox flow batteries are emerging as the most exciting new technology, with patent activity doubling since 2014, to 894 in 2019, also led by China, followed by the US. Hence we include notes on ESS Inc.

Interest has been waning in solid state batteries (-57% since 2014) and liquid metal batteries (-67%).

A description of each battery type is shown in the ‘battery types’ tab. Download the data-file for a break-out of the data by country.

Global CCS Projects Database

This data-file captures 65 carbon capture and storage (CCS) facilities around the world, of which c30 are currently running, with capacity to sequester 40MTpa of CO2. Capacity should rise 2.5x by 2030.

As costs deflate, CCS is expanding to more countries, more industries and away from EOR towards dedicated geological storage (charts above).

The full data-file includes each facility, its location, involved companies, construction status, volumes (MTpa), CCS process, industrial source of CO2, start-up, storage type, capex ($M where available), capex cost ($/ton where available) and 2-3 lines of notes per facility.

Variable Power Tariffs Exacerbate Social Inequalities?

This data-file tabulates the impacts of variable electricity tariffs, after switching 4.622 households over from fixed electricity tariffs, across a large-scale sample in the United States. This theme is increasingly important as intermittent renewables reach saturation in developed world power grids.

Residential electricity demand is inelastic, with a 20% price-increase yielding a mere 1% reduction in end-demand. Peakload demand fell by 4%.

However, socially “vulnerable” consumers suffered disproportionately, only achieving a 2% decrease in peakload demand. Hence, while monthly power prices rose by 18% for non-vulnerable consumers, they rose by 22% for vulnerable consumers. The results, data and study are in the data-file.

Ten Themes for Energy in 2020

Energy transition is maturing as an investment theme. ‘Obvious’ portfolio tilts are beginning to look over-crowded. Non-obvious ones are looking over-looked. This note outlines the ‘top ten’ themes that excite us most in 2020, among commodities, drivers of the energy transition, market perceptions and corporate strategies.

Will renewable growth slow down from 2020?

The growth of renewables has been revolutionary, with wind and solar costs emerging towards the bottom of the global cost curve, scaling up at a pace of 270TWH pa. However, we find unsettling evidence that the market could slow by c15% from 2020, plateauing in heartland markets such as California, Germany and the UK. The rationale, and all the underlying data, are included in this PDF research report and associated Excel file.

Methane Leaks from Downstream Gas Distribution

This data-file tabulates the methane emissions from downstream gas distribution across 160 US gas networks, which cover 1.1M miles of mains, 61M metered customers and >90% of the country’s retail gas demand.

Downstream US methane leakages average 0.2% by volume, explaining 5.7kg/boe of emissions. Two thirds of these leaks can be attributed to gas mains. Leakages are correlated with the share of sales to smaller customers. And state-owned utilities appear to have 2x higher leakage rates the public companies.

US gas utilities’ performance is screened to assess c80 distinct companies, including: Altagas, Atmos, Centerpoint, CMS, Dominion, DTE, Duke, Edison, National Grid, PG&E, Sempra, Southern Co, Spire, UGI, WEC & Xcel.

CO2 emissions from Permian shale production

This model disaggregates the CO2 emissions of producing shale oil, across 14 different contributors, aggregating across a dozen different models constructed by Thunder Said Energy: such as materials, drilling, fracturing, supply chain, lifting, processing, methane leaks and flaring.

CO2 intensity can also be flexed by changing different input assumptions, such as methane leakage, flaring activity and well productivity; while we will be happy to share underlying models with you, for further sensitivity analysis.

Our ‘idealized shale’ scenario follows in a separate tab, showing how it could be achievable to make Permian shale production a ‘carbon neutral’ resource.

Mitigating methane: what methods?

This data-file screens the methods available to monitor for methane emissions. Notes and metrics are tabulated for Method 21, Optical Gas Imaging, fixed sensors, ground labs, aircrafts, drones and satellites; including advances at the cutting edge of each method.

Emerging screening methods, such as drones and trucks are also scored, based on results from an excellent recent technical trial. The best drones can detect almost all methane leaks >90% faster than traditional methods.

Companies developing next-generation methane-mitigation technologies are screened, including 10 public  companies and 33 private companies. This peer group filed 150 patents in 2018-19. 8 companies seem particularly exciting to us.

Operators are also screened, across the dozen largest Energy Majors, to estimate their methane leaks and broader methane intensity across the supply chain.

US E&Ps turn to ESG?

Of the largest 15 shale E&Ps, the proportion with ESG slides in their quarterly presentations has exploded by 4.5x in the trailing twelve months, from 13% in 3Q18 to 60% in 3Q19.

The progress is tracked in this short data-file, which counts the number of ESG slides published, by company, by quarter; as the industry articulates its carbon credentials in order to help attract capital.