The Big Wins
• Liquid air is a novel energy concept that could help solve some of our toughest energy challenges:
- balancing an electricity grid increasingly dominated by intermittent renewables
- reducing greenhouse gas emissions from transport
- exploiting waste heat.
• Liquid air could help cut CO2 emissions from grid electricity by capturing ‘wrong time’ energy (such as excess renewable energy produced at night when there is too little demand) and using it to displace carbon intensive peak generation, and by allowing fossil plants to operate more efficiently. In a ‘high wind’ scenario, 15GW of liquid air energy storage would reduce grid emissions by 4.5%, while 30GW would cut them by 20%.
• Liquid air could act as a transport fuel capable of fast refuelling, zero emissions at the point of use, and ultra-low CO2 emissions: a liquid air vehicle would have lower lifecycle emissions than one powered by electricity or hydrogen by 2030, based on projected overnight grid carbon intensity; a liquid air lorry refrigeration unit would deliver 80% emissions cuts based on current grid electricity.
• Liquid air could enhance UK energy security by reducing our reliance on imported oil and gas, and providing strategic energy storage: a single gasometer-style tank could store sufficient energy as liquid air to make good the loss of 5GW of wind power for three hours.
• Industrial gas companies produce 8,500 tonnes per day of excess nitrogen (the main component of liquid air) which currently goes to waste and could instead be liquefied to fuel 6.5 million car kilometres daily.
• Liquid air could be produced for less than four pence per litre delivered, and fuel costs per-kilometre could be half those of a petrol car on the basis of current electricity prices.
• Liquid air can help transform large resources of waste heat and waste cold into power and fuel:
- Exploiting waste cold from LNG re-gasification at UK import terminals would cut the electricity required for air liquefaction by almost 60% and costs by half.
- Liquid air electricity generation can turn waste heat into power at high levels of efficiency. UK industry loses up to 40TWh of waste heat each year – enough to heat 2.4 million homes.
- In transport, liquid air engines could be combined with conventional internal combustion engines (ICEs) to create highly efficient ‘heat hybrids’. One novel ICE design incorporates liquid nitrogen to capture its own exhaust heat and raise fuel efficiency to 60%.
• Liquid air technologies are based on standard components and mature supply chains, and there is an extensive cryogenic liquids distribution network in all industrialised countries.
• The economic value of liquid air storage on the electricity grid could be £1 billion per year by 2050 and support 20,000 jobs. This excludes its potential impact in industry and transport.
• While liquid air appears to offer major benefits in emissions reduction, energy security and cost – quite apart from the economic potential of an entire new industry to UK PLC – those benefits may never be realised without appropriate policy support.
The ability of liquid air to reduce carbon dioxide emissions depends largely on the carbon intensity of the electricity used to produce it. However, the scale of emissions reductions is also application specific: some liquid air concepts such as refrigerated food transport would reduce carbon dioxide emissions even based on current grid average carbon intensity; others would start to deliver emissions reductions only on the basis of lower carbon electricity.
The carbon intensity of the grid is projected to fall significantly over the next two decades as coal fired power stations close and more wind generation continues to be added. This will reduce grid emissions overall, but will have an even more pronounced impact on off-peak or overnight carbon intensity, when demand is lower and nuclear and wind capacity will on average deliver a bigger proportion of the necessary power.
This is important because at present liquid nitrogen is invariably produced at night to take advantage of lower cost electricity. This coincidence of lower cost and lower carbon overnight electricity means emissions from liquid air technologies will fall faster than if they were charged at the grid average. It means, for example, that a diesel-cryogenic hybrid bus running on overnight liquid air would start to emit less CO2 than a standard diesel from 2015, and emissions would continue to improve thereafter.
Grid average emissions reductions
Liquid Air Energy Storage can help reduce average emissions from grid electricity by:
• capturing excess wind or other lower carbon overnight power that would otherwise be ‘constrained’ (wasted) and using it to displace fossil fuel generators at peak times; and
• allowing fossil plant to run more efficiently at full load, while storage devices assume their ‘load following’ role – raising or reducing output to match demand.
These two factors have the effect of lowering average emissions from grid electricity beyond any reductions achieved by simply changing the primary generating mix.
In terms of reduced wind constraint, we estimate that in a ‘high wind’ scenario with 40GW of wind capacity, around 17TWh would be constrained each year, the energy equivalent of around 3,000 x 2MW wind turbines. Liquid air storage could reduce some of this constraint and in turn displace high emitting plant, saving up to 8 million tonnes of CO2 (MtCO2) or around 6.5%.
In terms of total grid emissions savings under the same scenario – including reduced wind constraint and increased fossil plant efficiency – the emissions savings depend heavily on the duration of the assumed storage capacity. Higher capacities of storage with longer durations, such as those achievable by Liquid Air Energy Storage devices, can displace larger shares of peaking capacity and thereby increase the CO2 reductions.
The graph shows that one hour storage, even with large scale deployment, produces maximum CO2 savings of around 7–8%. However, this reduction can be achieved with around half the capacity if storage durations exceed three hours. At six hours’ storage duration – easily achieved by LAES – 15GW of storage capacity would save 5.6MtCO2, while 20GW would save 14Mt. A far more ambitious scenario of 30GW would save 24Mt, or almost a fifth (19.4%) of total grid emissions of 125MtCO2 in this scenario.
Since liquid nitrogen is invariably produced overnight when power prices are lowest, it is important to understand the likely evolution of the off-peak carbon intensity of grid electricity. Our analysis, based on scenarios from DECC’s 2050 pathways, shows that overnight emissions intensity falls faster than grid average, as the share of zero carbon generation during these low demand periods doubles to as much as 80% by 2030. The graph shows that by 2030 the emissions factor during low demand periods could be as low as 53gCO2/kWh for a system that on average still emits 93gCO2/kWh.
Emissions reductions in transport
In conventional vehicles, the dominant source of greenhouse gas emissions is the combustion of fossil fuels in the vehicles themselves. Lifecycle studies have shown that for a passenger car about 80% of total emissions come from fuel use – overwhelmingly from the exhaust pipe, with a much smaller fraction caused by oil production and refining – and 20% from ‘embedded’ emissions due to manufacturing and disposal of the vehicle. In commercial vehicles, which are used more intensively, fuel use accounts an even higher share of lifecycle emissions – typically 90% or more.
For alternative technologies such as EVs, FCVs and future vehicles powered by liquid air engines such as the Dearman Engine (DE), emissions are dominated by the carbon intensity of the electricity used to make the ‘fuel’ and the efficiency of the powertrain. This makes the lifecycle emissions of all three technologies sensitive to the pace of decarbonisation of the electricity grid. On a ‘well-to-wheels’ basis, which considers emissions from fuel use only, emissions from a DE vehicle would be twice those of an ICE based on today’s grid average electricity, but fall to less than a third of the ICE’s based on the projected carbon intensity of overnight electricity in 2030.
Another significant factor is embedded emissions. EVs and FCVs have higher embedded emissions than ICE vehicles because of the lithium and platinum needed to make batteries and fuel cells. However, DE vehicles are likely to have embedded emissions similar to ICE vehicles in the early years of production, and this becomes increasingly important as the well-to-wheels emissions of all alternative powertrains decline over time. This means estimated DE lifecycle emissions are lower than those of current EVs and FCVs by 2030.
Cryogenic engines such as the Dearman Engine could be combined with conventional ICEs as highly efficient ‘heat hybrids’. Detailed modelling by the Dearman Engine Company and E4tech shows such ICE-DE hybrids could produce carbon savings from 2015. One liquid air application, food transport refrigeration, could achieve major CO2 reductions even on the basis of the current grid average carbon intensity. We calculate a large refrigerated lorry fitted with an auxiliary Dearman Engine to provide both shaft power and cooling could save 38 tonnes of CO2 per year, a reduction of 80% against conventional diesel-powered refrigeration unit. On the basis of projected overnight carbon intensity in 2030, the savings would be 98%.
Energy security is a widely used but poorly defined term. Even the Government has no categorical definition, despite having published an energy security strategy in November 2012. More generally the phrase is taken to mean the lights will stay on, homes remain warm and vehicles keep moving in all but the most exceptional circumstances.
Although the Government has not precisely defined energy security, a report for DECC by the late Malcolm Wicks MP in 2009 identified three different aspects:
- geopolitical security: avoiding undue reliance on specific nations so as to maintain maximum degrees of freedom in foreign policy;
- price security: avoiding unnecessary price spikes due to supply/demand imbalances or poor market operation; and
- physical security: avoiding involuntary physical interruptions to consumption of energy.
Liquid air could help improve energy security under all three headings by:
- reducing gas imports by storing excess off-peak wind power to displace gas fired peaking plant;
- reducing imports of oil, petrol and diesel by converting low carbon electricity into a transport energy vector/fuel;
- improving the physical energy security of the electricity grid by mitigating intermittency of renewable generation, reducing the risk of power cuts;
- providing strategic electricity storage – a single cryogenic storage tank of the type used to store LNG could store enough energy as liquid air to make good the loss of 5GW of wind power for three hours; and
- improving price security by reducing the need to invest in flexible generation and grid reinforcement, and reducing wind wastage. A study for the Carbon Trust found the total benefits of grid storage could amount to £10 billion per year by 2050.
Economy and jobs
At this early stage it is clearly not possible to quantify with any certainty the potential value of liquid air to the entire UK economy. However, it is possible to make a high level estimate of the value of grid-based Liquid Air Energy Storage (LAES) technology to UK manufacturing, on the basis of the results of our report Liquid Air in the energy and transport systems.
Other recent advances in low carbon technologies – such as offshore wind, for example – have delivered disappointingly little economic benefit to the UK, because we lack the relevant manufacturing base. However, liquid air plays to the UK’s traditional strengths in mechanical engineering and cryogenics, and a substantial proportion of a LAES plant could be sourced from UK suppliers. If design, civil engineering and construction work were added to domestically produced components, around 50-60% of the value of a LAES installation could originate in the UK.
In the Full Report we analysed the potential GDP and jobs impact of LAES technology (excluding transport) in the UK using three models – see table. The biggest impacts were produced by the Share of Benefits analysis, which showed that by 2050 the LAES business could be worth £1 billion per year and support 20,000 jobs. These results may be conservative since a study for the Carbon Trust found the total benefits of grid storage could amount to £10 billion per year by 2050.
However, it should be stressed that this analysis is high level and indicative, and the results are highly dependent on assumptions about the size of the storage market. Nor does it consider the potential economic impact of liquid air in the transport sector.