The Energy Industry Is Transforming Before Our Very Eyes

By Paul Browning

The energy industry is going through a significant period of transformation. Countries are decarbonizing their energy grids to lower the impact on the environment. Natural gas is now the number one fuel source in the U.S., and global demand is escalating. Low cost renewable energy is disrupting conventional business models, and as it reaches penetration levels in front of and behind the meter, it is altering the grid itself.

Combining Renewables With Combined-Cycle Gas Turbines (CCGT)

Over the past 15 years, power grids in developed economies are decarbonizing as aging facilities are replaced with an increasingly affordable combination of natural gas and renewable power generation.

Renewable prices – namely PV solar and onshore/offshore wind – have fallen rapidly as they have achieved greater supply chain scale and as technology improves capacity factor and installed cost.

For natural gas, new drilling technologies, combined with advances in gas turbine technology, mean that in the past decade the fuel has become cheaper, the turbines less expensive per unit of output and fuel efficiency has improved. This combination has allowed power grids to decarbonize at an even faster rate as natural gas displaces coal-fired and oil-fired power generation.

The benefit to the environment is clear. Combined-cycle natural gas produces about 65 percent less carbon dioxide than an equivalently sized retiring coal-fired power plant. And when paired with a 50/50 mix of gas and renewables, the reduction is 85 percent.

Researchers at Carnegie Mellon University posted data at their US Power Sector Carbon Index (link: www.emissionsindex.org) showing that the combination of natural gas and renewables displacing coal-fired and oil-fired power plants has reduced carbon emissions from the US power sector by 33 percent since 2005.

The Storage Breakthrough

We can continue to decarbonize the power grid for many years by using a mix of natural gas and renewable power generation to displace coal-fired and oil-fired power generation. However, how do we continue to make progress in places like California, where all of the coal-fired power generation is already retired, and where excess renewable electricity is causing market distortions?

The next phase of development will involve storage of electricity using hydrogen.

In the last century, hydrogen powered the space program and brought us to the moon. Now, hydrogen is once again the focus of intense research and development activity. This time, the quest is to unlock its potential to store excess electricity at times when pricing becomes very low or even negative.

Hydrogen can be produced from renewable energy through the process of electrolysis, which uses excess renewable electricity to break the water molecule (H2O) into hydrogen and oxygen molecules. This renewable hydrogen can be stored, and later used in a combined cycle gas turbine power plant to produce electricity as required to balance supply and demand.

Mitsubishi Hitachi Power Systems successfully tested the world’s largest, most fuel-efficient gas turbine fueled by a 30 percent hydrogen mix. The test demonstrated reliable operation and a significant reduction in CO2 emissions compared to a standard natural gas-fired power plant; and this is only the beginning. MHPS has already announced a project in the Netherlands to convert a 440 MW natural gas CCGT to 100 percent hydrogen combustion.

The answer to a cleaner energy future lies in the combination of natural gas and renewable energy sources. As our ability to store energy becomes greater, we can create zero CO2 emissions energy systems that are dispatchable and can balance supply and demand and provide the world with sustainable, reliable power.

This is a Change in Power.

Paul Browning is the President & CEO of Mitsubishi Hitachi Power Systems Americas.