1. The importance of net energy Michael Carbajales-Dale GCEP Net Energy Analysis Workshop March 31 st 2015 Co-authors: Charles Barnhart, Adam Brandt, Sally Benson

2. What is the purpose of the economy? 2

3. 3 http://steadystate.org/an-economics-fit-for-purpose-in-a-finite-world/

4. The traditional model of economics 4 Economy (Production) Society (Consumption) factors of production goods & services spending income Price Biosphere Heun, Carbajales-Dale, Haney (2015) Beyond GDP: National Accounting in the Age of Resource Depletion, Springer

5. Bringing energy into the picture 5 Economy (Production) Society (Consumption) factors of production goods & services spending income Price Biosphere Energy Resources Heun, Carbajales-Dale, Haney (2015) Beyond GDP: National Accounting in the Age of Resource Depletion, Springer

6. A model that obeys thermodynamics 6 Economy (Production) Society (Consumption) factors of production goods & services spending income Price Biosphere Material & Energy Resources Material & Energy Waste Heun, Carbajales-Dale, Haney (2015) Beyond GDP: National Accounting in the Age of Resource Depletion, Springer

7. What is net energy? “You have to ‘spend’ energy to ‘make’ energy” 7 Carbajales-Dale et al. (2014) Nature Climate Change, 4(7), 524-527.

8. What is net energy? 8 Energy sector

9. What is net energy? 9 Energy sectorGross energy

10. What is net energy? 10 Energy sectorGross energy Self “consumption”

11. Net energy What is net energy? 11 Energy sectorGross energy Self-consumption

12. Net energy What happens as self-consumption increases? 12 Energy sectorGross energy Self-consumption

13. Impacts of net energy analysis (NEA) 1.Energy and the economy 2.Early technology appraisal 3.Environmental impacts of energy extraction and use 4.Managing the energy transition 13

14. 1. Energy and the economy The availability of energy fuels economic processes and economic growth The energy sector must supply an energy surplus to the rest of the economy The cost share of energy can cause disruption to the economy Rapidly growing energy industries can run an energy deficit 14

15. 1. Energy and the economy 15 http://www.ssb-foundation.com/photos/SSB-DEGINFO.jpg

16. Dale & Benson (2013) Environmental Science & Technology, 47(7) 3482-3489 1. Energy and the economy 16

17. 2. Early technology appraisal Nascent technologies (low TRL) often have highly uncertain economics In particular when considering –development of new materials, –new production processes or –translating lab-scale prototypes to commercial production. Net energy analysis (NEA) can identify potential costs and barriers to technology development 17

18. 2. Early technology appraisal 18 Barnhart & Benson, Energy & Environmental Science 6.4 (2013): 1083-1092

19. 3. Environmental impacts 19 Impacts from primary energy extraction scale with total energy consumption Energy production pathways with lower energy inputs help reduce environmental impacts Every unit of energy consumed within the energy sector acts as a multiplier that increases environmental impacts

20. 3. Environmental impacts Photovoltaic (PV) CO 2 emissions vs. energy cost 20 Sherwani et al.(2010) Renewable and Sustainable Energy Reviews 14, 1

21. 4. Managing the energy transition NEA allows quantitative comparisons of the energetic performance of various transition pathways –What are the most favorable pathways for an energy transition? –How does growth of new energy technologies impact the global energy system? –What should be done with excess, renewably generated electricity? 21

22. 4. Managing the energy transition 22 Carbajales-Dale, Barnhart & Benson. Energy & Environmental Science 7(5) 1538-1544.

23. Indicators drive actions 23

24. Indicators drive actions 24

25. Indicators drive actions 25

26. 1. Energy and the economy Matt Heun, Calvin College –Energy in macroeconomic growth models Carey King, Energy Institute UT Austin –Energy input-output and economy-wide EROI Simon Roberts, ARUP UK –The energy-economy system 26

27. 2. Early technology appraisal Matt Pellow, GCEP –Energy storage in hydrogen Pei Zhai, Northeastern University –Solar hydrogen generation Marco Raugei, Oxford Brookes University –Photovoltaics systems 27

28. 3. Environmental impacts Adam Brandt, Stanford University –Unconventional fossil fuels Garvin Heath, NREL –Electricity generation Carey King, Energy Institute UT Austin –Water 28

29. 4. Managing the energy transition Charles Barnhart, Western Washington University –Energy storage and transmission Michael Carbajales-Dale, Clemson University –Fueling the energy transition Trieu Mai, NREL –Future energy scenarios 29