This week, Phil Watts, the chairman of Royal Dutch Shell, gave a remarkable speech in New York, just three weeks after the tragedy of September 11th.
Accustomed to making and approving business decisions and technology plans that extend decades into the future, Watts told an audience assembled under the auspices of the United Nations Development Program, that Shell, one of the largest oil companies in the world, was preparing for the "End of the Hydrocarbon Age."
He painted two possible scenarios he termed, "Dynamics as Usual" and "The Spirit of the Coming Age."
Under the first scenario, Shell envisions an "evolutionary" carbon shift from coal to natural gas to renewables. Petroleum's current 40 percent global energy share will drop to 25 percent by 2050. Natural gas market share will climb to 20 percent while the remainder will come from a combination of nuclear and various renewable sources.
Under "The Spirit of the Coming Age" scenario, the world would experience a far more dramatic shift from carbon-intensive fuels to hydrogen. Watt's stated this second scenario, "explores something rather more revolutionary, the potential for a truly hydrogen economy, growing out of new and exciting developments in fuel cells, advanced hydrocarbon technologies and carbon dioxide sequestration."
Watts envisioned fuel cells beginning to reach serious market penetration by 2025 and as a result dramatically altering the energy landscape long before oil becomes scarce.
Watts isn't just talking the talk. He has pledged to walk the walk by committing between $500 million and $1 billion over the next five years to develop new energy businesses, concentrating primarily on solar and wind energy.
Watts concluded his remarks by saying that oil companies can no longer assume they will dominate the next 100 years as they have the previous century. "That would be a very complacent view."
Phil Watt's comments in New York this week are truly remarkable in the light of the events on and after September 11, 2001. Here is a major oil company executive publicly stating that the world is changing and his company plans to lead in this transition. He pointed out that not only does he intend to make Shell "a prime mover in this transitional period" but he also noted that "one in five of the world's population does not have access to commercial energy. It is our goal to contribute to the development of an affordable, sustainable energy system which will help reduce this sort of inequality."
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The challenge of using hydrogen, however, also creates new opportunities because it is best made and used on site, as needed. There are few places on earth that don't have sufficient sunlight and wind to make feasible the electrolysis of water from photovoltaics or wind power. Given the sharp drop in the cost of wind generated electricity, now as low as 4-5 cents per kilowatt and the equally sharp decline in the cost of photovoltaic energy technology -- which is forecast to continue to drop even more -- it is entirely possible that these technologies someday can be "married" to create a practical, affordable, self-contained generation system that provides a home, a business or a community with electricity, purified water and sufficient heat to warm and cool buildings.
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Or instead of electrolyzing water, someday we could have waste water treatment facilities that feed tanks of hydrogen-producing algae. This approach promises to be even more cost-effective. Communities could generate their own supply of hydrogen. The problem of transporting hydrogen would be minimized if not eliminated.
Imagine the community of the future where algae-produced hydrogen powers fuel cells that produce electricity, clean water and district or process heat. And because of advances in energy efficiency and smart community planning, the homes and businesses in the community will utilize far less than they do today.
And in the spirit of Phil Watts' vision, this technology would be available to all. Rural villages in Malawi and Uzbekistan and Honduras could have the energy they need to improve their quality of life. The standard of living would go up, there would be greater literacy, less environmental degradation and a lower birth rate.
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Is such a scenario feasible? Is it technically, economically, and politically possible? I believe it is.
The bigger question is, "Can human nature adapt to this brave new world?" That is the real unknown. We are resilient. We are adaptive. And to be perfectly honest, do we have any other choice? The wider the gulf grows between the have and have-nots of the world, the more inequities we will see and the more terrorism we will experience.
The hydrogen economy won't solve the problem of human nature, but it might just put us back in touch with the rhythms of the planet on which we all depend. Is this the impossible dream? Perhaps. I will be the first to admit it is imperfect. But I also believe it is one worth dreaming and more importantly, striving to achieve. September 11th marks a great turning point in the history of man. Which path we take will determine whether it marks the beginning of the end or just the end of the beginning.
-- Robert J. Berger UltraDevices, Inc. 257 Castro Street, Suite 223 Mt. View CA. 94041 Email: rberger at ultradevices.com http://www.ultradevices.com Voice: 408-882-4755 Fax: 408-490-2868
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