Picture: ISTOCK
Picture: ISTOCK

Despite some headline-grabbing figures and improved efficiencies surrounding renewable energy options such as solar, wind and wave power, the majority of the planet still produces its electricity by burning fossil fuels.

Some 41% of the world’s electricity needs are still produced using coal, according to the World Coal Association, with China and the US being by far the highest users. However, as detractors of fossil fuels are inclined to highlight, coal emits nearly double the amount of carbon as other fuels.

The switch to cleaner sources such as natural gas or liquid petroleum gas is, therefore, desperately needed from an environmental and health point of view. Between 2030 and 2050, climate change is expected to cause approximately 250,000 additional deaths a year. The need for environmental action is further supported by the fact that, globally, the number of reported weather-related natural disasters has more than tripled since the 1960s. Every year, these disasters result in more than 60,000 deaths, mainly in developing countries.

As more people move away from traditional petrol or diesel transport in favour of electronic vehicles, the cleanliness of the electricity and the methods used to create this power will increasingly come into question

In the US, natural gas is now the largest source of electricity generation, having overtaken coal in 2015. A handful of states in the US north-east are driving this shift to natural gas usage, which is relatively cheaper in comparison to coal and has a beneficial environmental impact.

A 2016 report by MJ Bradley & Associates, an environmental consulting firm in the US, noted: "North-eastern states have been the vanguard of the changes that are transforming how electricity is produced and delivered in the US. The region has already experienced a major shift in the mix of resources used to produce electricity, with natural gas and renewables displacing older coal-and oil-fired power plants."

Broadcaster CNBC, quoting from a recent Energy Information Administration (EIA) report, notes that both New York and Connecticut’s coal-generation capacity plummeted by 90% in the past decade.

Not surprisingly, America’s production of crude and natural gas liquids — such as propane, methane and ethane — is forecast, according to the EIA, to rise by 780,000 barrels per day (bpd) in 2017 and by more than 1-million bpd in 2018. This is being supported, according to Reuters news agency, by the fact that US exploration and production firms have hired 530 extra drilling rigs since the end of May 2016 — 431 to target oil and 99 to focus on gas.

While onshore production is increasing, the biggest changes to the energy market will soon be seen floating in an ocean near you.

Most of the world’s large and easy-to-find gas reserves have been discovered. This means that to meet the world’s expected energy demand and growth in the liquefied natural gas (LNG) market, smaller and more remote supplies need to be found.

It may not be the most attractive name but floating liquefied natural gas (FLNG) plants have become the latest innovation in energy production. These nautical mega-structures are a massive technological advance in increasing efficiency and productivity. Developed by Malaysian national company Petronas, FLNGs will produce, liquefy, store and transfer LNG directly to a container before it is shipped to market.

Imagine several square kilometres of production, processing and off-loading facilities on one ship. Once full, it will weigh the same as six aircraft carriers.

Just a theory for many years, FLNG is now a reality and should be more cost-effective at accessing remote gas reserves than traditional delivery, since the requirements to pipe the gas to shore are no longer necessary. Due to this, FLNG also leaves a smaller environmental footprint.

FLNGs remove the need for expensive, long-distance pipelines and onshore terminals. They also mean that each floating processing plant can move to a new location in the event that a field becomes depleted, or it can be sold on, improving the lifetime of the facility.

Another technological advance which goes hand-in-hand with FLNG is floating storage re-gasification unit (FSRU). Where FLNG sources and liquefies the natural gas ready for transportation at source, FSRUs wait for the delivery before turning it back into gas, which is then transported via pipeline or truck to its final destination.

Floating liquefied natural gas plants have become the latest innovation in energy production. These nautical mega-structures are a massive technological advance in increasing efficiency and productivity

Another area worth watching closely is familiar to us all and relates to how we transport ourselves, and our families, on a day-to-day basis. As more people move away from traditional petrol or diesel transport in favour of electronic vehicles, the cleanliness of the electricity and the methods used to create this power will increasingly come into question.

Countries such as China, India and Australia are still heavily dependent on coal for their electricity production, accounting for 69%, 60% and 73% of their total electricity production respectively. In SA, a staggering 77% of the country’s primary energy needs are still provided by coal. Operating an electric vehicle in certain areas of these countries would, therefore, be just as damaging to the environment as a traditional petrol or diesel engine.

Furthermore, with the current mix of energy sources used to produce electricity in China and India, an electric vehicle would only average 50km to 30km per 3.7 litres equivalent, respectively. That said, as more nations switch their electricity production to cleaner energy sources such as natural gas and nuclear, so too will electric vehicles become a far more environmentally friendly option.

While technology is helping to develop renewables on a cost-effective basis, there is still some way to go. In the meantime, developing and promoting the use of cleaner power is a must for the protection of future generations.

As media darling Elon Musk, founder of Tesla, once said: "We must move towards renewable energy. To argue that is to say that eventually we will run out of energy and die or civilisation will collapse." Slowly, but surely, the world is listening. Change is coming, and coal’s grip on the world’s power grids is gradually loosening, one innovation at a time.

Robinson is Ashburton Investments energy fund manager in Jersey

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