These 9 technological innovations will shape the sustainability agenda
in 2019
McKinsey sustainability experts weigh in on the
year ahead.
Applies 25 years of experience in the energy sector to
help companies deliver performance, growth, and innovation
ENERGY MOBILITY
With a new year, we’re taking a fresh look at
where sustainability is headed globally. What technologies will drive the
global discussions, and moreover, which will have the greatest impact in 2019?
I asked McKinsey’s leading sustainability experts for their thoughts.
1.
Public electric transport.
It’s not only individual vehicle owners who
have better access to electric vehicles (EVs) than ever before—there are 160
electric and hybrid vehicle models available today—but municipalities are
taking notice as well. In China, 300,000 electric buses hum down city streets
every day. Their widespread adoption in China—an economic coup as much as a
policy one—will entice European cities to follow suit. Although these eBuses
have higher acquisition prices due to upfront battery costs, their total cost
of ownership (TCO) is lower due to their independence from pricey diesel. They
also eliminate local particulates, including SOx, NOx, and CO2, all major
issues in most cities today.
2.
Electric trucks.
With personal electric vehicles grabbing more
and more market share, commercial fleets could follow suit rapidly. But to
ensure an efficient transition, we need a firm understanding of the total cost
of ownership. Decades ago, widespread adoption of electric trucks—or
“eTrucks”—was cost prohibitive. But today, the total cost of ownership could
soon be on par with diesel-run trucks, due in part to increasingly cost
competitive and available electric vehicle infrastructure. We predict that
adoption of battery electric commercial vehicles (BECVs), especially in the
light- and medium-duty segments, could surpass the car EV sales mix in some
markets by 2030. And although many heavy-duty BECVs will need to charge
mid-route, our analysis shows that a charging station every 80 to 100
kilometers on popular routes will suffice for early phases of adoption.
3.
Cheap energy storage.
The new age of electric vehicles has rapidly
expanded the market for lithium and cobalt batteries—and drastically reduced
their price. Lithium ion batteries now cost $200 per kilowatt-hour compared to
$1,000 per kilowatt-hour just nine years ago. The expanded market for batteries
has implications for more than just EVs. Industry and utilities are finding
broader use for them as energy-storage solutions. With prices for batteries
rapidly dropping, they are proving valuable to reduce power costs, increase
reliability and resiliency, and make power systems more flexible to operate.
But the wide accessibility of cheap energy storage also means utilities will
need to change quickly. One way will be to move away from a variable rate
structure to a fixed fee for access to the grid (like cable TV), especially as
consumers begin to generate their own energy. Another will be to revise
grid-planning approaches by increasing circuit-by-circuit nodal planning.
4.
Long-term storage.
Lithium-ion batteries are great for
addressing short-term storage needs (4-5 hours) that arise frequently (20-200
times per year), but the market also wants solutions that address long-term
storage needs brought on by seasonal shifts and multi-day periods when the sun
does not shine and the wind does not blow. Historically, hydropower dams were
one of the only approaches to manage these seasonal shifts. Otherwise, the
system would need to build a whole series of plants that only run for a few
days each year. Fortunately, a new series of
innovators believe they are close to developing
long-duration storage technologies. Google X just spun off Malta, which is
storing renewable energy in molten salt. Antora Energy is trying to solve the
same problem by building a low-cost thermal battery for grid-scale energy
storage. And BP-backed Lightsource is adding storage to solar developments.
What’s clear is that if long-term energy storage works, the price of power will
decline significantly. These long-term solutions could eliminate the cost
incurred through the underutilization of assets during and save money by
inserting lower-cost generators such as solar and wind in the power supply.
5.
Plastic recycling.
260 million tons of plastic waste is
generated across the globe every year, but only 16 percent gets recycled. The
plastics industry has the opportunity to move away from a “take, make, and
dispose” business model and adopt a circular model, which aims to eliminate
waste across sectors while creating economic, societal, and environmental
benefits. One promising circular process is pyrolysis, which uses heat and the
absence of oxygen to reconvert plastic waste back into liquid feedstock. The
benefits are economic as much as environmental, with a recycling-based profit
pool estimated at $55 billion by the next decade.
6. LED
light efficiency.
Energy-efficient LED lighting is quickly
replacing traditional incandescent bulbs in American homes and is expected to
achieve 84 percent
market share by 2030. In 2030 alone, LED lights will reduce
energy consumption by 40 percent, which adds up to $26 billion in savings
adjusted to today’s energy prices. These are dramatic cost savings, but
according to the Department of Energy, the U.S. can still see an additional 20
percent in energy savings with increased investment in LED lights.
7.
Accessible solar power.
Renewable energy continues to become cheaper
and more accessible into 2019, a trend that has major implications for the
nearly 1 billion people across the globe without access to electricity. While
expanding the grid is part of the access solution, countries in sub-Saharan
Africa and the Caribbean, which account for a majority of the world’s
unelectrified population, are exploring renewable solutions like solar energy
to bring energy quickly and inexpensively to millions. Innovative financing
plans can help make previously unaffordable solar home systems (SHSs) a smart
solution for communities that are too far from a reliable grid connection. A
recent McKinsey assessment determined that SHSs can help power 150 million
households by 2020.
8.
Carbon capture and storage.
Instead of just focusing on completely
decarbonizing the major industrial commodities behind plastics and cement, we
can also consider safely capturing the carbon emitted when these commodities
are produced. Carbon capture and storage (CCS) allows industry to capture
carbon at its source, compress it, and move it to a suitable permanent storage
site. The technology not only has the potential to significantly reduce
greenhouse-gas emissions—it can also mean more money if the CO2 can be used
profitably to make other products. Several industries are already working to
put captured carbon dioxide to profitable use, including manufacturers who use
captured carbon to make plastics, such as polyurethane. Emerging technologies,
including direct air capture, have previously been too cost prohibitive to
implement at scale. But a new Stanford University study predicts that direct
air capture, which grabs carbon dioxide from the air and convers it into
synthetic fuel, could eventually drop from $600 per ton of carbon dioxide to
less than $100.
9.
Hydrogen in the energy transition.
It’s difficult to imagine how we meet
ambitious global warming benchmarks without including hydrogen as a critical
part of the solution. Hydrogen-led pathways to cleaning up the environment forecast
hydrogen powering more than 400 million cars, 15 to 20 million buses, and more
than 20 percent of passenger ships and locomotives by 2050. Although
battery-powered electric vehicles exhibit overall higher fuel efficiency,
hydrogen-powered fuel cells can store more energy with less weight. This makes
them an ideal solution for heavy cargo vehicles that must travel long
distances. Hydrogen-powered fuel cell vehicles are already on the road in
Japan, South Korea, California, and Germany—and more than 10 models are slated
for release by 2020. In short, hydrogen fuel could help the world meet its goal
of decreasing carbon dioxide emissions by 60 percent. Although the necessary
technology exists today, the costs for producing hydrogen need to decline significantly,
and the infrastructure that supports it needs a step up. Hydrogen could
facilitate smarter use of other renewables by acting as a long-term transport
and storage solution for renewable electricity. It could be a key enabler in
the energy transition.
Matt Rogers
https://www.mckinsey.com/business-functions/sustainability/our-insights/sustainability-blog/these-9-technological-innovations-will-shape-the-sustainability-agenda-in-2019?cid=other-eml-alt-mip-mck&hlkid=c3ada1f686fc4f1fa84327c7efbca27d&hctky=1627601&hdpid=ddc0090f-a4d1-40bc-a8af-36e91a7280a8
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