CERA Week is a usually superb bellwether of energy sector moods, and this year was no exception.
Overall I found the tone last week to be pragmatic, occasionally even downbeat.
Amin Nasser of Saudi Aramco captured the general mood in his comments (https://lnkd.in/gMSQViKF), noting that consumers “want energy that helps protect the planet and their pocket books, with minimal disruption to supplies and their daily lives”.
His full comments are worth reading, and don’t mince words on critical points I agree with such as:
😡 Tribalism and hyperbole are deeply counterproductive to addressing our collective climate challenge
📈 Consumers in lower and middle income countries (who use far less resources than those in the wealthier world today) will increasingly drive the climate agenda
🏔 The hashtag#energytransition is not on track
The final point is a serious concern, because out in the real world the clock is ticking.
Just prior to CERA I had an update from the Berkeley Earth team, and though I was aware of recent increases in ocean temperature, it was still shocking to see record daily temperatures now observed for over a year.
But unfortunately the conversations and presentations at CERA highlighted how difficult it will be to pull off the badly needed shift away from fossil fuels, especially natural gas.
For example, although ⚡ electrification is a primary pathway to decarbonize a range of consumer and industrial demand, there is simply not enough power, transmission capacity, and even just grid hardware to go around. Particularly as the power demands of data centers grow and tech companies fill up grid connection queues, planners and policymakers will need to take extra care to ensure decarbonization projects aren’t pushed back in the line.
So in the end I left Houston exhausted and concerned, but still optimistic.
To quote Nasser one final time “the world has been trying to transition in fog, without a compass”.
This compass is precisely what we are building at Othersphere, helping those scaling sustainable infrastructure to build better projects, faster. The energy transition is a global challenge that will be solved at the local level—step-by-step, project-by-project.
CERA was full of smart people working together to make this happen.
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“Manage the millions, and the trillions will look after themselves” nicely paraphrases the key to industrial decarbonization investment.
We take this approach at Othersphere, modeling tens of billions of potential capital projects from the bottom-up, to help turn asset-level success into global-scale action. For each individual project permutation we assess key factors such as reachable offtake, site-specific grid fees and CAPEX, feedstock pricing / fundamentals, buffer storage requirements, real-world plant CAPEX and operating constraints, hourly optimization of electrolysis operations (if applicable), and much more.
This leads to hundreds of individual project permutations, which we assess at ~180 million individual sites across the globe 🌐, made possible by modern big data and AI.
A fascinating byproduct of this bottom-up work is a unique aggregated look into the fit of different technologies in different locations, which we’re excited to share today.
If you would like to access the slides directly, please click here.
Absolutely, as location-specific details on economics, emissions, and local human environmental factors make all the difference.
Typically project analysts must spend days/week/months gathering data and model projects one-by-one in order to assess the fundamentals of lower GHG #hydrogen, #steel, #datacenters, and so on. We make all of this available instantly, and constantly work with a range of leading energy and engineering firms to validate and refine our results.
This is a particularly charged molecule 🥁and we seem to be entering the latest down-phase of market sentiment on hydrogen—a regular cycle driven by high potential 📈grinding against difficult execution 📉.
For many focused on lower GHG hydrogen production, at first glance our results may appear daunting, as the average cost difference between new approaches and incumbent supplies can be significant.
But on a site-by-site basis the ‘green premium’ may be lower than the average, or not exist at all. In addition, as these lower GHG technologies scale their costs will tend to fall over time (all projects in the shared slides have a 2030 start year), while the stranded asset risks for incumbent approaches will rise.
Ultimately we hope to reduce these swings in market sentiment by focusing on fundamentals, revealing risks and opportunities early in project development processes, and helping reduce wasted time and development capital.
The example data summaries shared today underpins every search in Othersphere Explorer, part of how we help cut project siting, design, and diligence from months to hours. With this breakthrough technology enabled by Google Cloud, users can:
If you would like to learn more, please reach out for a demo!
Othersphere models tens of billions of potential capital projects from the bottom-up in parallel, to help turn asset-level success into global-scale action.
Equipment sizing and operating strategy LCOH optimizations for hydrogen electrolysis plants are cumbersome and time-consuming. It can take days to weeks to get the data, with each optimization run often taking hours. This limits analytical efforts to a handful of potential sites, leaving many opportunities unexplored.
The result — sub-optimal capital allocation and higher risks, with countless missed opportunities.The difference between initial cost calculations versus hourly optimizations can be dramatic, and highlights location as a critical element of project success.
Othersphere has revolutionized this process by combining the power of our underlying spatial economics platform with neural networks for dimensionality reduction and surrogate modeling.
Our global search engine now recommends pre-optimized projects in seconds, having already run an hourly optimization considering:
1) Hourly day-ahead wholesale power market pricing
2) Grid upgrade CAPEX (developed with a global leader in grid transmission engineering and equipment)
3) Grid fees associated with transmission connections
4) Variable stack efficiency by load, incorporating operational ranges
5) System economies of scale, as well as commercial and technical nuances between PEM and alkaline plants
6) Hourly carbon intensity data
7) Demand profiles and cost of storage
8) Co-located renewables CAPEX
9) High-spatial resolution hourly solar and wind capacity factor data
All of this is delivered through the Othersphere Explorer tool, which provides a novel, bottom-up view of potential hydrogen projects, evaluating key factors such as production costs, emissions, available offtakers, and fit with local surroundings.
Introducing the world’s first global optimizer for hydrogen projects
Please reach out if you would like to learn more about Othersphere, our products, and opportunities to partner in accelerating global industrial decarbonization.
