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An Opportunity As Big As Electricity & Transportation Combined

By Jakob Jensen — — Posted in heat series

Heliac solar field in Møn

Heat is likely the single most missed opportunity for entrepreneurs, investors and the global climate alike.

Heat production uses almost half the world’s energy consumption. 2.5x as much energy is used for heat than for power, i.e. electricity. Though electricity-producing solar cells and wind turbines only cover a few percentages of global energy consumption most initiatives and discussions about energy and climate focus on these two solutions.

When looking at heat production it's worth noting that the remaining part of our electricity consumption is produced by fossil-fired, heat-driven turbines.

All energy may one day be supplied by solar, wind and hydro, but due to the unreliable nature of solar and wind and the limited availability of hydropower, this will require a lot of storage. Using batteries for large-scale, long-duration storage is not a financially sustainable solution. An analysis from EIA (US Energy Information Administration) finds long-duration storage systems to be up to 4 times more expensive per kW than short-duration systems, where short duration is defined as less than half an hour and long duration is more than a couple of hours.

In other words, though the cost of batteries has come a long way down there’s still a very long way to go if batteries are to become cost-competitive to fossil fuels when looking at storage for months, week, or even just days. Heat, on the other hand, can already now be stored in large scale for months at low costs. This will be the theme of the Save For Rainy Days article later in this series.

EIA forecasts renewables – including renewable fuels such as biodiesel and biogas – to account for only 23% of our energy use by 2040. As global energy consumption continues to increase, so will the use of fossil fuels despite the increase in renewables.
Illustration

Discussions about how to increase renewables' share of the global energy market rarely focus on the energy supplied to and consumed by the heat-driven processes that require half the world's energy. In an attempt to get heat higher on the agenda, this series focuses on how and why renewables' proportion of the total energy market may increase significantly above EIA's projections.

For many people, energy is primarily something that comes out of wall plugs and gasoline pumps which is why they probably don't give heat much thought. And sustainable energy production is something that comes from wind turbines and solar cells. With this being an almost generic mindset it is understandable why the vast majority of politicians and companies focus on solar cells and wind turbines when looking for sustainable energy solutions.

Still, it's remarkable that only a few entrepreneurs, companies and investors seem to be developing and funding solutions addressing heat's 50% footprint of the total energy demand. Maybe nobody talks and thinks about it because nobody talks and thinks about it? Or maybe discussions that actually do take place are too focused on technical experts using technical lingo and focusing technical stuff, and thus discouraging journalists and investors from spending time and resources on the subject.?

I hope the upcoming articles focusing on costs, drivers, solutions, opportunities, challenges, and climate can help inspire a broader discussion and accelerate initiatives and ideas that may profit from building new heat-centered businesses.

Interested in reading more? Please see the links to my other articles below. Additionally, a 'Like’ from you will also be much appreciated as this should help direct more attention at the many business and climate opportunities the market for heat production offers.

Thank you for reading,

Jakob Jensen

HEAT is a series of non-technical, easy-read 3-minutes articles looking at heat’s role in energy production, its environmental impact, technologies for sustainable large-scale heat production, and some of the business opportunities these solutions generate.

References

Renewables: Global Status Report, REN21 2018
Lazard’s Levelized Cost of Storage Analysis 3.0, Lazard 2017
Electricity Storage and Renewables to 2030, IRENA 2017
Renewables by 2040, EIA 2017
US Battery Storage Market Trends, EIA 2018

About me

I have spent the better part of 20 years investing in cleantech startups. During my career I have probably seen at least 3,000 business proposals, including Heliac's which I was introduced to in 2016 when I headed Climate-KIC Nordic's accelerator program. I found—and still find—Heliac's solution to be by far the best new solution I've ever come around, which is why I joined the company in early 2017.

Disclaimer: I have not double-checked all my sources and I am not an expert in all areas mentioned in the articles. I may therefore have reached conclusions that wiser men and women may know to be inaccurate. If so, I trust they will let me know, so I can become a bit wiser too.

This insight was originally posted in LinkedIn