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Copyright of Shell International 1
Powering Progress Together – Providing Energy Storage Solutions for a Changing World
Joep Huijsmans, Sr-Technology Advisor Long Range Research & New Energy Technologies 6th Heat & Storage Symposium, Swiss Competence Center for Energy Research, October 25, 2017, Martigny, Switzerland
November 2016 Long Range Research
Copyright of Shell International
Definitions & Cautionary note
2017 2
Reserves: Our use of the term “reserves” in this presentation means SEC proved oil and gas reserves. Resources: Our use of the term “resources” in this presenta tion includes quantities of oil and gas not yet classified as SEC proved oil and gas reserves. Resources a re consistent with the Society of Petroleum Engineers 2P and 2C definitions. Organic: Our use of the term Organic includes SEC proved oil and gas reserves excluding changes resulting from acquisitions, divestments and year-average pricing impact. Sha les: Our use of the term ‘sha les’ refers to tight, sha le and coa l bed methane oil and gas acreage. The companies in which Roya l Dutch Shell plc directly and indirectly owns investments a re separa te lega l entities. In this presenta tion “Shell”, “Shell group” and “Royal Dutch Shell” a re sometimes used for convenience where references a re made to Roya l Dutch Shell plc and its subsidia ries in genera l. Likewise, the words “we”, “us” and “our” a re a lso used to refer to subsidia ries in genera l or to those who work for them. These expressions a re a lso used where no useful purpose is served by identifying the particula r company or companies. ‘‘Subsidia ries’’, “Shell subsidia ries” and “Shell companies” as used in this presenta tion refer to companies over which Roya l Dutch Shell plc either directly or indirectly has control. Entities and unincorpora ted a rrangements over which Shell has joint control a re genera lly referred to “joint ventures” and “joint opera tions” respectively. Entities over which Shell has significant influence but neither control nor joint control a re referred to as “associa tes”. The term “Shell interest” is used for convenience to indica te the direct and/ or indirect ownership interest held by Shell in a venture, pa rtnership or company, a fter exclusion of a ll third-party interest. This presenta tion conta ins forward-looking sta tements concerning the financia l condition, results of opera tions and businesses of Roya l Dutch Shell. All sta tements other than sta tements of historica l fact a re, or may be deemed to be, forward-looking sta tements. Forward-looking sta tements a re sta tements of future expecta tions tha t a re based on management’s current expecta tions and assumptions and involve known and unknown risks and uncerta inties tha t could cause actua l results, performance or events to differ materia lly from those expressed or implied in these sta tements. Forward-looking sta tements include, among other things, sta tements concerning the potentia l exposure of Roya l Dutch Shell to market risks and sta tements expressing management’s expecta tions, beliefs, estimates, forecasts, projections and assumptions. These forward-looking sta tements a re identified by their use of terms and phrases such as ‘‘anticipa te’’, ‘‘believe’’, ‘‘could’’, ‘‘estimate’’, ‘‘expect’’, ‘‘goa ls’’, ‘‘intend’’, ‘‘may’’, ‘‘objectives’’, ‘‘outlook’’, ‘‘plan’’, ‘‘probably’’, ‘‘project’’, ‘‘risks’’, “schedule”, ‘‘seek’’, ‘‘should’’, ‘‘ta rget’’, ‘‘will’’ and simila r terms and phrases. There a re a number of factors tha t could a ffect the future opera tions of Roya l Dutch Shell and could cause those results to differ materia lly from those expressed in the forward-looking sta tements included in this presenta tion, including (without limita tion): (a ) price fluctua tions in crude oil and na tura l gas; (b) changes in demand for Shell’s products; (c) currency fluctua tions; (d) drilling and production results; (e) reserves estimates; (f) loss of market share and industry competition; (g) environmenta l and physica l risks; (h) risks associa ted with the identifica tion of suitable potentia l acquisition properties and ta rgets, and successful negotia tion and completion of such transactions; (i) the risk of doing business in developing countries and countries subject to interna tiona l sanctions; (j) legisla tive, fisca l and regula tory developments including regula tory measures addressing climate change; (k) economic and financia l market conditions in various countries and regions; (l) politica l risks, including the risks of expropria tion and renegotia tion of the terms of contracts with governmenta l entities, delays or advancements in the approva l of projects and delays in the reimbursement for shared costs; and (m) changes in trading conditions. All forward-looking sta tements conta ined in this presenta tion a re expressly qua lified in their entirety by the cautionary sta tements conta ined or referred to in this section. Readers should not place undue reliance on forward-looking sta tements. Additiona l risk factors tha t may a ffect future results a re conta ined in Roya l Dutch Shell’s 20-F for the year ended December 31, 2015 (ava ilable a t www.shell.com/ investor and www.sec.gov ). These risk factors a lso expressly qua lify a ll forward looking sta tements conta ined in this presenta tion and should be considered by the reader. Each forward-looking sta tement speaks only as of the da te of this presenta tion, 19 September 2017. Neither Roya l Dutch Shell plc nor any of its subsidia ries undertake any obliga tion to publicly upda te or revise any forward-looking sta tement as a result of new information, future events or other information. In light of these risks, results could differ materia lly from those sta ted, implied or inferred from the forward-looking sta tements conta ined in this presenta tion. We may have used certa in terms, such as resources, in this presenta tion tha t United Sta tes Securities and Exchange Commission (SEC) strictly prohibits us from including in our filings with the SEC. U.S. Investors a re urged to consider closely the disclosure in our Form 20-F, File No 1-32575, ava ilable on the SEC website www.sec.gov.
Copyright of Shell International
The world needs more and cleaner energy
3
“ Energy is the golden thread that connects
economic growth, social equity, and
environmental sustainability” Ban Ki-Moon
Former UN Secretary General, April 2012
“ The ability to question rather than cling to
old beliefs is vital for tackling the energy
challenge” Ben van Beurden
CEO Royal Dutch Shell, June 2016
Copyright of Shell International
Shell's role in the transition to a low -carbon world
4
Developing our gas business Biofuels business
Advocate CO2 pricing Scenarios thought leadership Coalitions & government advisory
New Energies business
Advancing CCS R&D in low carbon technologies Shell Technology Ventures
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World class research and development Combined with local know-how
5
Market/regional services
Global innovation
USA
Netherlands Germany
India
China
Qatar Oman
Brazil
Houston Amsterdam Bangalore
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A look at energy and emissions today (estimated 2015)
6
Total emissions: 52 GTCO2e
Residential, services and others
Transport
Industry
Livestock, agriculture and land use
Electricity and heat production
2015
Greenhouse gas emission sources
Sources: Shell, drawing on IPCC 4th Assessment Report / 5th Assessment Report, IEA, BP Sta tistica l Review of World Energy, Global Methane Initia tive
Gas
Oil
Coal
Bioenergy
Nuclear
Solar
Wind
Other
Energy source:
2 0 1 5
Primary energy sources
Oil and gas make up a round ha lf the world’s primary energy supply
Copyright of Shell International
Energy for a changing world
There is more demand for energy globally as the world’s population and living standards increase
Rising demand Global energy demand will likely be almost 60% higher in 2060 than today, with 2 billion vehicles on the road (800 million today).
Ongoing supply Renewable energy could triple by 2050, but we will still need large amounts of oil and gas to provide the full range of energy products that the world needs.
Mitigating climate change Net-zero emissions is a potentially achievable societal ambition.
Growing population Global population is expected to increase from around 7.4 billion today to nearly 10 billion by 2050, with 67% living in cities.
7
Source: UN Population Fund; UN World population Prospects (2015 revision); World Urbanisation Prospects (2014 revision); IEA, Energy Technology Perspectives 2015; Shell New Lens Scenarios
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The Pace of Energy Decarbonization will vary by Industry Sector
8
Copyright of Shell International
Launched a New Energies Business to Explore new Opportunities
New fuels Cleaner
transporta tion
Biofuels +
hydrogen
In te g ra te d e n e r g y so lu tio n s NL + USA wind
Solar for
enhanced oil
Co n n e cte d cu s to m e r Connected
mobility
Connected
energy
Copyright of Shell International
Global Perspective
Policy coordination vs technology A journey to net-zero emissions
10 Long Range Research
Source: Shell FET ana lysis
Compact cities
CCS
H2
100 EJ bioenergy
Sola r fuels Advanced ba tteries
electrifica tion intermittent renewables (PV, wind), storage buildings codes & standards
efficiency
Large sca le CO 2 offset mechanisms
Pro
gre
ss t
hro
ug
h c
oo
rdin
ati
on
an
d
reg
ula
tory
dri
ve
P ro g re s s b y te ch n o lo g ica l b re a k th ro u g h s w ith s tro n g co m m e rcia l d r ive
Copyright of Shell International
Long Range Research (LRR) – Back to Basics and Fundamental R&D
New Energy Develop a radica lly better energy carrier using low
cost sola r energy combined with novel technologies for energy storage and conversion
Chemicals Find new pa thways to convert methane to products
Enabling sciences Electrochemistry Materia ls science Structured ca ta lysts & interfacia l phenomena Transport phenomena Computa tiona l materia l science & chemistry Biosciences
Emphasis on scientific areas where: (i) we want to build capability; (ii) there is significan innovation headrooom; (iii) it has impact across multiple applications
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The Long Range Research Technology Platform
DENSE ENERGY CARRIERS (DEC)
ADVANCED ENERGY STORAGE (AES)
METHANE TO PRODUCTS (M2P) PROGRAMS
Ultra Low Cost High Efficiency Solar PV
Conversion of Photons to H2
Computational Material Science & Chemistry
CO2 Direct Air Capture
Novel Routes to Syngas and HC Fuel Synthesis
Artificial Photosynthesis
Intercalation-based Battery Systems
Novel Approaches
(Supercapacitors, Flow Batteries)
Integrated System Analysis and Product Choice
Chemistry & Catalysis (a) Fundamentals (b) Oxidative Pathways (c) Pyrolytic/Thermal Pathway
Separations
Conversion-based Battery Systems
Electrolytes THEMES
Discovering the Unknown
ENABLING CAPABILITIES
Bio-Sciences & Bio-Engineering
Exploratory Experimentation 12
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PV Auction Database: PPA prices decline
13
Source: Official government publications, World Bank, IFC, BNEF, various news sources Latest 3 bids <30$/MWh
Copyright of Shell International
Solar Energy: Pathway to Dense Energy Carriers
14
Photons
Electrons
Hydrogen
Hydrocarbons (Diesel, Methane )
Highest product utility Lowest handling costs Most compact use
Ammonia
Methanol
CO2
Heating Lighting
Power Cooking Heating/ Cooling Persona l mobility Rail
Persona l mobility Heavy transport Industria l hea t Power Rail Cooking Heating/ Cooling
TO END-USER
TO END-USER
TO END-USER
Util
ity (e
.g. d
ensit
y)
Cos
t
Highest energy utiliza tion Lowest production costs Smallest production footprint
Electricity is moving from being one of the most expensive energy carriers to tha t with the lowest cost,
with sola r genera tion offering the highest energy utiliza tion and the smallest footprint.
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Electrolysis the backbone for Dense(r) Energy Carriers
15
H2
HC Fuel
MeOH
NH3
Electrons
10-20 $/ MWh Water
electrolysis
Haber Bosch
Atmospheric N2
Atmospheric CO2
Ease
of u
se
(tran
spor
t, sto
rage
)
Cost of synthesis • Technology & molecula r
building block for the other energy carriers
• First deployments: “Molecule” va lue of hydrogen significantly above fuel va lue. Large existing market in refining and fertilisers
• What does systems infrastructure look like?
Water
Economic & Society optimum unknown
Fischer Tropsch
Synthesis
“Cost” of “Feed” September 2017 Energy Transition Summit - Bangalore
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Dense Energy Carriers – Direct routes
16
H2
HC Fuel
MeOH
NH3
Electrons
10-20 $/ MWh Atmospheric
N2 Atmospheric
CO2
Ease
of u
se
(tran
spor
t, sto
rage
)
Cost of synthesis Direct routes
• Would a ll be electrochemica l • Technology and sca le-up
cha llenges simila r to water electrolysis
• How does required unit opera tions effect molecule choice?
Water
Economic & Society optimum unknown
Cost of “Feed”
?
?
?
September 2017 Energy Transition Summit - Bangalore
Copyright of Shell International
The Long Range Research Technology Platform
DENSE ENERGY CARRIERS (DEC)
ADVANCED ENERGY STORAGE (AES)
METHANE TO PRODUCTS (M2P) PROGRAMS
Ultra Low Cost High Efficiency Solar PV
Conversion of Photons to H2
Computational Material Science & Chemistry
CO2 Direct Air Capture
Novel Routes to Syngas and HC Fuel Synthesis
Artificial Photosynthesis
Intercalation-based Battery Systems
Novel Approaches
(Supercapacitors, Flow Batteries)
Integrated System Analysis and Product Choice
Chemistry & Catalysis (a) Fundamentals (b) Oxidative Pathways (c) Pyrolytic/Thermal Pathway
Separations
Conversion-based Battery Systems
Electrolytes THEMES
Discovering the Unknown
ENABLING CAPABILITIES
Bio-Sciences & Bio-Engineering
Exploratory Experimentation 17
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Energy Storage: Falling costs & significant expansions of lithium -ion batteries
Source: Bloomberg New Energy Finance
Similar trends for Solar PV & Li-ion EV packs (~20% cost reductions for every doubling of production)
2010
2015
Solar PV
Li-ion EV packs
1976
1988
1998
18
September 2017 Energy Transition Summit - Bangalore
Copyright of Shell International
Why Electrochemical Energy Storage?
Highly efficient; enables broader use of high-quality energy as electricity
It’s the most flexible with the grea test opportunity space, due to its range of sizes, and applicability across sectors to provide energy services (sta tionary power, mobility, consumer products)
For rechargeable ba tteries, the infrastructure is already in place or can be readily expanded with known technology for “fueling”
Storage options set aga inst incumbents (fossil fuels). The green a rea is indica tive of “utility-sca le” storage; decentra lized H2 represents use of excess renewable electricity. Thermal storage is most efficient when used as hea t.
kWh MWh GWh TWh
second
minute
hour
day
month
yea r
Flywheels
Butane lighter
Petrol tank
H2 Pumped hydro
Ba tteries Utility sca le
Oil, LNG tank
CAES
Decentra lized H2
Thermal
Range of energy storage technologies
Recent performance improvements & price declines have opened new applica tions & markets
Still significant opportunities for technology improvement to enable widespread deployment
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Long Range Research: Key External Technical Collaborations
West Coast Berkeley Stanford
UK Hub Imperia l, Cambridge, Oxford Manchester / Exeter
NL Hub: TU Delft, Utrecht TU Eindhoven DIFFER, ECN
China CAS-SARI and a ffilia tes India
IISc, NCL Brazil Hub
Sao Paulo/ FAPESP
MIT Texas Rice, UT Austin, Texas A&M