Energy consumption is a growing problem, driving searches for solutions
by David Hwang, Lux Research
November 18, 2010 - Energy consumption has grown consistently since humans first burned wood to roast meat, and growth in energy usage is robust today: in just 17 years starting from 1990, total primary energy consumption worldwide has grown 31% to 456 quadrillion BTU (quads) in 2007 (see Figure 1). While the faltering of the world economy has depressed industrial production, consumer activity, and travel since 2007, it's clear from the rise of population and energy needs in emerging economies like Brazil, China, and India that this retreat will just be a temporary hiccup. While growing energy usage has lifted living standards and helped deliver all the goods of modern life, it's becoming clear that our ever-increasing consumption in energy is unsustainable.
|Figure 1: Global primary energy consumption grew 31% between 1990-2007.|
Due to the risks posed by swelling energy consumption, inventors, investors, and entrepreneurs have turned their efforts towards ways of improving energy efficiency -- whether through better engines, a smarter power grid, or more economical equipment and appliances. Policymakers have thrown their support behind such goals, with efforts such as the US's Advanced Research Projects Agency -- Energy (ARPA-E), Japan's New Energy and Industrial Technology Development Organization (NEDO), and Germany's National Energy Efficiency Action Plan (NEEAP). Developers of nanomaterial-based technologies are no exception, seeking to turn up ways nanoscale materials' unique properties can help trim energy needs.
Efficiency is the path of least resistance
To avoid an energy crisis, nations like the US, Japan, and Germany could opt for one of two unpalatable choices. They can try to legally enforce conservation, which irritates many citizens who are accustomed to the benefits they gain from their energy usage. Alternatively, they can build out production capabilities for renewable energy sources, but many of these technologies are still young, and the prices of renewable energy are usually uncompetitive when subsidies are removed from the equation. There's a third option, however: pursuing energy efficiency, which can shave off consumption without requiring austerity measures from users.
As an enabling technology for many applications, nanotechnology can be a potent tool for enhancing the efficiency of both new and existing devices and processes. While most of the attention given to nanomaterials for energy applications has been devoted to energy production and storage, there has also been much work on improving the energy outlook from the demand side as well. With a decade of serious government, corporate, and venture capital investment under its belt (see the report "Ranking the Nations on Nanotech: Hidden Havens and False Threats"), the field has generated many nano-enabled products that can improve energy efficiency and are already commercial and on the market. In this report we assess the impact of six products in particular (see Figure 2).
|Figure 2: Six products rein in energy consumption in all four sectors.|
Nanotech's potential belies its size
We use the examples of the US, Germany, and Japan as three case studies to discuss the impact these nano-enabled products on energy consumption. As a starting point, we set out to quantify the total opportunity these six products posed for reducing energy consumption, assuming they achieve their full potential and 100% adoption. We found that these innovations alone could in principle reduce overall final energy consumption (FEC) in the US, Germany, and Japan by 10.9%, 13.9%, and 9.2% respectively in 2020 (see Figure 3).
|Figure 3: Full adoption promises enormous impact.|
Full adoption, while useful for quantifying opportunities, is an unrealistic assumption and therefore not a good indicator for the future. To provide a more accurate determination of the impacts of these products, we built reasonable adoption scenarios for the six products by dropping them into buckets for 10%, 25%, and 50% saturation points and 10-year, 20-year, and 30-year adoption cycles, and then reanalyzed their effects on energy consumption. Note that this calculation is not an attempt to precisely forecast the market, but rather to make reasonable assumptions that allowed us to provide a realistic portrait of the future.
Under these new realistic adoption scenarios, all three countries coincidentally reduce FEC by about 1.6% (see Figure 4). As was the case under full adoption assumptions, the US, Germany, and Japan all benefited differently from these six nano-enabled products. Cumulatively, reductions from lighting and from automotive lightweighting through composites had the most effect, constituting about 40% and 27% of the realized energy savings from the three countries respectively.
|Figure 4: Savings are severely reduced under realistic adoption scenarios.|
Worries about energy needs are growing to a fever pitch, but virtually everywhere in the world energy demand continues to rise. Meeting this demand with cleaner or more secure energy sources can help assuage some worries, but the relentless upward march of energy usage makes for an intimidating challenge. Combined with other energy efficiency measures, from the smart grid to hybrid electric vehicles, nano-enabled products can help trim away at energy needs, dropping CO2 emissions, limiting environmental impacts, and mitigating cost and security concerns around conventional energy sources. Other challenges abound, of course: the developing world's booming energy demand will be tougher to trim; penetration of renewables will still need to accelerate to seriously dent fossil fuels' energy dominance. But nano-enabled products that advance energy efficiency will play a strong part in managing looming energy challenges -- creating solid business opportunities along the way.
David Hwang received a BSE in Bioengineering from the University of Pennsylvania and is an analyst at Lux Research Inc. His full report on nanotech's answer to the energy problem is "Nanotech's Answer Key to the Energy Problem ".