Low-cost renewable energy isn't just changing where end users are getting their energy, it's changing how they get it as well. Energy networks are growing more distributed, interconnected, and interchangeable. Today's isolated, unidirectional electricity, oil, and gas infrastructure wasn't built for these complex energy networks of the future, so how will asset owners and the customers they serve adapt to this new energy landscape? In this blog, we will highlight the evolution of energy networks.
Despite the ongoing situation and potential near-term impact on the global economy, the world continues to grow and has also resulted in a greater demand for energy. However, not every country can meet its own energy demands through domestic production, and the global energy trade - notably coal, oil, and natural gas - is crucial for many countries to maintain a growing economy due to their limited domestic energy resources. Globally, 2,800 TWh per year is transported from resource-rich regions, such as the Middle East, to energy-insensitive regions, such as Southeast Asia.
In parallel, countries are also pushing towards decarbonization – an outcome that coal, oil, and natural gas can’t provide. But many countries are finding it difficult to replace these hydrocarbon-based energy imports with domestic renewables like wind and solar. While harnessing the “unlimited” power of sun and wind makes for great headlines, these new energies also face their own resource limitations, especially in countries where energy demand is simply too high to be met with low-energy density wind and solar alone. There needs to be a renewable proxy for the global oil trade – where renewable electricity is transferred via energy carriers beyond electricity. (Lux Members, see our recent case studies on how the Netherlands and Japan are exploring the potential of establishing a zero-carbon energy import hub and large-scale renewable energy transport.)
There are several potential energy carriers – hydrogen, synthetic methane, ammonia, and many others being evaluated today. To identify the optimal energy carrier to import renewable energy, a new framework is needed, and a series of key questions remain unanswered.
What are the available energy carriers?
What are the technical and economic limitations of each of them?
How does the scale of the delivered power and delivered distance impact these choices?
Find the answers, potential renewable energy carriers, and suitability for importing low-cost renewable energy to resource-constrained or energy-intensive economics when you download the executive summary of our report “Decarbonizing the Global Energy Trade.”