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Energy Efficiency & Environmental

Energy efficiency largely determines the required level of energy production and is therefore an important component of the world energy balance. Energy efficiency is usually quantified in terms of various energy intensity indicators. In particular, the ratio of primary energy supply to GDP is used to demonstrate the global energy intensity, as well as the total energy intensity of individual countries. Sometimes the inverse indicator is also used in the form of the ratio of the GDP value to the unit of energy expended. The type of resources from which energy is consumed is important in assessing energy intensity. Obviously, the consumption of renewable resources does not lead to the irreversible depletion of traditional fossil fuel and negative environmental impact, therefore increased energy intensity is not always a critical problem, if economic indicators are factored out. But it should be borne in mind that at present almost 90% of global primary energy is provided by fossil fuels, therefore, with the exception of a few countries and industries, their consumption will be the primary determiner of current energy intensity.

Of course, energy efficiency in any industry, including the energy sector, is limited by the current level of technical and organizational development. However, a lot depends on the degree of administrative regulation, on the availability of natural resources and on the degree of implementation of modern technologies. The influence of energy efficiency on the overall energy balance remains, however, hugely significant.

In recent years, according to research by the International Energy Agency, there has been a slowdown in the rate of decline in global energy intensity, nevertheless, since the beginning of this century, there has been an overall decrease of 25%. It could be assumed that the energy efficiency of each individual country is primarily related to the level of its economic development and climatic conditions. However, these factors do not clearly correlate. For example, Iceland, which has high economic indicators in terms of GDP per capita and a not at all harsh climate, ranks bottom of the list in terms of GDP per unit of energy use.

Of course, this is facilitated by the geographical isolation of the country and the presence of large natural hydro and geothermal resources. The production of energy from renewable sources in Iceland exceeds 70%, and provides almost 100% of its electricity generation (data from Eurostat for 2018). Therefore, Iceland can afford to heat sidewalks in the capital or small areas of sea for recreational purposes. But this does not represent a waste of natural resources, or a disregard for environmental problems. As for the value of energy consumption, in Iceland's case energy intensity is just a statistical fact that does not reveal the true picture of energy consumption. Canada, Finland, South Korea, Qatar and other highly developed countries with diverse climatic conditions demonstrate low energy intensity indicators, despite the fact that not all of them have considerable energy resources. 

For Canada, and especially Qatar, relatively low energy intensity is largely determined by the exceptional reserves of fossil fuels and the high level of energy production, against much lower domestic consumption, which seems to hinder the development of expensive energy-saving technologies. Thus, it can be assumed that the level of energy efficiency is formed in each country under the complex influence of a large number of individual factors. As a result, taking full account of these factors and developing energy efficiency programs is not an easy task, especially since their implementation inevitably requires the successful application of the optimal technical, economic, legislative and even educational measures and solutions.

The design and implementation of energy efficiency programs is further complicated by the fact that all of them must be based on stringent environmental protection requirements. Most of the available energy production technologies leave a negative footprint in the form of emissions of carbon dioxide, methane, other harmful gases, as well as the generation of hazardous solid and liquid waste. Of course, this primarily applies to fossil fuels, but is also to a certain extent applicable to renewable sources. Thus, the large-scale use of electric vehicles or hydrogen driven vehicles does not equate to unequivocal environmental benefits if the electricity is generated at coal stations and the hydrogen is produced from natural gas. Nevertheless, these issues are well understood and most modern energy efficiency programs will factor in environmental requirements,  addressing the whole chain of energy production. The result of such measures should be a simultaneous decrease in the level of energy consumption (and therefore a proportional decrease in energy production) combined with a decrease in the amount of harmful emissions at all stages from primary production to final consumption.

There is a large list of bottlenecks in this process. Some of them are directly related to the energy production industry. Among them, it is necessary, first of all, to highlight very energy-intensive and environmentally unfriendly technologies related to fossil fuels, such as the production of high-viscosity oil by steam stimulation, hydraulic fracturing, disposal of waste and associated petroleum gas, and the processing of sour gas and oil. For example, the level of associated gas flaring in the world, accompanied by CO2 emissions, remains very high. According to the aggregate data of NOAA, Colorado School of Mines and other sources, despite the fact that over the past twenty-five years, global oil production has increased by more than 35%, and the volume of associated gas flaring, on the contrary, has decreased by almost 10%, more than 150 billion m3 of associated petroleum gas is still being flared annually. This particularly applies to Russia, Iraq, Iran and the United States. Although modern technologies make it possible to convert associated petroleum gas into other useful energy products (purified methane, liquid fuel, electricity), the process of implementation is slow due to high investment costs and insufficiently robust levels of administrative regulation in some countries. Associated petroleum gas processing is a good illustration of the simultaneous increase in energy efficiency, reduction of energy intensity of production and improvement in environmental performance.

When energy is consumed, there are also significant opportunities for increasing efficiency in all sectors - in transport, construction, buildings and energy storage, among others. For vehicles, there are several ways to improve their energy efficiency. One of them is to reduce the weight of the structure by using lighter and stronger materials, including aluminum alloys, composite materials, and special plastics. Other improvements can be found in reducing the drag of the external structure, optimizing engine performance, the use of energy recovery systems through regenerative braking and the introduction of many other technical advances. However, the most important factors in terms of economical and environmentally friendly energy consumption relate to the use of new types of fuels and energy sources. There have been significant achievements in the use of various types of biofuels, although their efficiency is still lagging behind fossil fuels. In some countries, in particular in Japan, Germany and the USA (California), the development of fuel cell vehicles has been extensive. Owing to this development, the number of hydrogen refueling stations in the world has grown from several dozen to several hundred over the past decade. Another and, perhaps, the main area in automotive development relates to the production of electric vehicles. The current annual sales of these vehicles worldwide in the PHEV (Plug-in Electric Vehicle) variant are steadily approaching or already exceeds 3 million units. Norway is the undisputed leader, where more than 90% of new cars sold are PHEVs. Considering that almost 100% of electricity in this country is produced from renewable sources, Norway can be considered as a model for a progressive environmental vision of the automotive industry’s future.

The building sector has huge potential for reducing energy intensity, where considerable consumption of electrical and thermal energy is concentrated. Significant technical and organizational results have been achieved in the creation and application of high-quality thermal insulation materials and structures, solar photovoltaic and thermal panels, heat pumps, LED lighting systems, etc. For newly erected buildings, in addition to these technologies, site specific design is increasingly being used, including orientating buildings relative to the direction of the sun, special ventilation and light flow control systems inside the premises, the placement of photovoltaic panels on the facades and much more.

Another colossal reserve for increasing energy efficiency, and thus reducing energy intensity, is the creation of reliable and powerful energy storage systems. This is particularly applicable to renewable sources - primarily to wind and solar energy - as fossil fuels have convenient characteristics for long-term storage. The lack of sufficient storage systems for electricity requires the use of redundant systems for generating electricity in the absence of sunlight or sufficient wind power. Currently, in more than 90% of cases, energy storage is provided by pumped storage. Other options, including batteries, account for no more than 4-5%. However, the location of pumped storage plants is highly dependent on geographic conditions. In addition, they are expensive and require long-term investment, which limits their spread. Hopes are pinned on the large-scale replication of solar power plants with concentrators and systems for thermal storage of energy in the form of salts (Molten Salt Thermal Storage CSP). For wind energy, an increase in the capacity factor from the current 20-35% to 50-60% can be achieved via the increase in size of wind turbines, the placement of wind farms in offshore zones and the optimization of measures for the diagnostics, repair and replacement of wind turbine parts. These measures can significantly reduce the severity of the problem of energy storage, but do not fully solve it.

2020 will lead to an adjustment in current trends and forecasts due to the unprecedented negative impact of the Covid-19 pandemic.

It is difficult to say how this will affect the energy intensity indicators in the near future. Here deviations are possible in any direction. However, in the medium and long term, the problems of depletion of fossil fuels and climate change against the background of an increase in primary energy consumption remain critical which will inevitably require a return to addressing the issue of reducing global energy intensity, albeit in more challenging conditions than existed pre-pandemic.