Most days, the sun shines bright over the goldfields of Western Australia. But not every day—which matters if you’re trying to run a mine on solar power. Starting next year, the Agnew Gold Mine’s owners won’t have to worry about clouds interfering with production. By then, the Australian energy firm EDL intends to complete a local micro-grid, pairing renewables on sunny afternoons and windy nights with a backup system for calm periods and dusk. During those hours, industrial-strength batteries will switch on, providing seamless power until natural gas–driven turbines spin up to speed. The combined array will deliver 54MW of power—enough to power 10,000 homes (or several tons of ingots).
“Until a few years ago, that would have all been diesel power,” says Keith Barker, executive general manager for technology at EDL. “But we’ve since introduced solar and wind into the mix to create what we call ‘hybrid renewables,’ where we look to displace as many fossil fuels as we can.”
The evolving mix at Agnew is a microcosm of larger changes in the global grid. Renewables comprised 25% of worldwide electricity generation in 2017, according to the International Energy Agency. According to Bloomberg’s New Energy Outlook, that figure will rise to 48% for solar and wind—and 62% for all renewables, including hydroelectric—by 2050, along with steep declines in coal and oil. The good news is that the IEA has historically underestimated the growth in renewables, especially solar. In the UK, for example, electricity from wind, solar, and biomass surpassed fossil fuels for the first time in modern history in the third quarter of 2019, well ahead of schedule.
The bad news is that wind and solar remain intermittent and always will. Utilities seeking to add more to the mix face two difficult choices: either overbuild in the short term to provide redundancy (at crippling expense), or borrow EDL’s hybrid approach using fossil fuels as a backstop. When the latter is done right, a virtuous circle emerges as renewables replace the least expensive fuel available for the grid, which is typically coal. When done wrong—as Germany discovered during the early stages of its Energiewende(“energy transition”)—you’re forced to turn to those fuels when the sun doesn’t shine or the wind doesn’t blow. The trick is to find a fuel cleaner than coal that can be flipped on and off like a switch, relatively speaking.
“Coal is great for the baseload and can also be dispatched when needed,” says Tim Gardner, vice president at the energy consultancy IHS Markit. “But the less it’s used, the more expensive it becomes—and of course it has a terrible carbon footprint.” The alternative is natural gas, which is typically more expensive for baseload but, Gardner notes, “can be dispatched on a dime.” It helps that natural gas has a carbon footprint approximately half that of coal, and one-tenth the particulate pollution.
After more than a decade of hype, natural gas is finally proving to be the “bridge to renewables” touted by the energy industry. IHS Markit imagines an “efficient frontier” at which even the cheapest, dirtiest coal is eventually chased from the market by a more efficient mix of gas and renewables. “They’re natural partners,” Gardner says.
A case in point is the United Kingdom, where renewables penetration is soaring despite an inhospitable climate. In June, UK Power Reserve and Cummins Power Generation finished deploying more than 500MW of gas-fired power plants throughout England and Wales, equivalent to the electricity demand of more than a quarter of a million homes and representing 1.4% of the UK’s peak demand for electricity. Controlled from a single operations center outside Birmingham, these 26 plants can be spun up or down as needed when solar and wind generation dips.
“The backbone of these pairings will be these centralized controllers dictating which energy sources will operate at various times in various ways, optimizing the mix while ensuring you can provide that power at a reliable rate,” says Craig Wilkins, director of the prime power business at Cummins. “We’ve done this for years with backup diesel-generator systems, but for renewables you need a control center intelligent enough to both sense the load on the consumer side and the input from the power side, switching sources on and off at only a few minutes’ notice.”
If natural gas is the bridge to a renewable future, what awaits on the other side? And how quickly will the multibillion-dollar investments in these plants be rendered obsolete by advances in storage, whether industrial-strength batteries or hydrogen? For example, the U.S. military is pushing ahead with an order for several Cummins Tactical Energy Storage Units for use in a micro-grid application. Analysts aren’t worried. “Gas-combustion turbines have a 10-year payback,” says Gardner, the energy consultant. “Many will recover their investment in less. How durable is that partnership in 20 years when batteries and renewables are mature? I’m not sure. Butit isn’t a big problem.”
And hydrogen—which has long been mooted as a zero-emission storage medium—may be a natural partner for natural gas as well. Producing and compressing liquid-hydrogen fuel is an energy-intensive process, which matters less when the grid is comprised of renewables backed by gas. Fuel-cell technology—in particular, solid-oxide fuel cells—are a promising, flexible, and environmentally friendly solution that is complementary to current natural-gas power products. And as automakers pursue electric vehicles—whether powered by batteries or hydrogen—demand will only grow. The IEA projects that, in its higher-case scenarios, EVs will generate an additional 1,100 terawatt-hours of demand by 2030—or about 5% of the world’s current power production.
“We have to meet that demand one way or another,” says Cummins’ Wilkins. “Renewables will play a big piece of that, and so will natural gas. But in terms of all the demands being placed on energy—environmental, public, customer—and being practical in terms of distribution, [natural gas] is going to remain a part of the mix.”