History of Energy Supply

A Historical Perspective on Energy Supply

• Human energy consumption began millennia ago, utilizing natural resources such as the sun, fire, wind, and water.
• Traditional biomass (wood, crop waste, charcoal) was the main energy source until the mid-19th century.
• The Industrial Revolution in the 18th century brought about a significant change with the widespread use of coal.
• Innovations like the steam engine drove coal usage, especially in the 18th century.
• Advancements in internal combustion engine and drilling technologies in the late 19th and early 20th centuries led to the rise of oil and natural gas.
• The 20th and 21st centuries expanded the energy mix to include hydropower, nuclear energy, and renewable sources like solar and wind.
• Environmental concerns encouraged a global shift toward cleaner energy sources, reducing fossil fuel use.

Dominant Energy Sources Over Time

• Pre-19th Century: Biomass (wood, crop waste, charcoal), wind, and water were the primary sources, with limited renewable use for sails and mills.
• 18th Century: Wood and coal became dominant, coinciding with the Industrial Revolution and James Watt's improved steam engine.
• 19th Century: Coal took over as the dominant source for industrial power, with the emergence of oil and gas. The first commercial oil well was drilled in the U.S.
• Early 20th Century: Coal, oil, and natural gas predominated due to internal combustion engines and the use of natural gas for heating and cooking.
• Mid-20th Century: Oil became the largest energy source, with the expansion of electricity grids and the emergence of nuclear power.
• Late 20th Century: Oil, natural gas, coal, nuclear, hydropower, and emerging renewables were used. The first oil crisis highlighted energy security, leading to solar and wind tech development.
• 21st Century: Oil, coal, natural gas, renewables, and nuclear are used. Climate change concerns have driven rapid growth in solar and wind, prioritizing energy efficiency.

Fundamentals of Energy Supply

• Energy supply encompasses the entire delivery process of usable energy, from extraction to end-use consumption.
• Primary energy sources include coal, oil, natural gas, uranium, and renewables (solar, wind, hydro, geothermal).
• Secondary energy sources are created from primary ones, like electricity.
• Energy is delivered through three main stages: generation, transmission, and distribution.
• Substations manage voltage changes throughout the system. Historically, centralized generation near energy sources was more efficient.

Different Sources of Energy Supply

• The global energy system relies on fossil fuels, renewable energy, and nuclear power.
• Fossil fuels (coal, oil, natural gas) are non-renewable resources formed from ancient organic matter, dominating global energy due to high energy content.
• Coal is mainly used for electricity generation and heavy industries, but is highly polluting.
• Oil is used in transportation, plastics, chemicals, and industrial fuels, extracted through drilling or fracking.
• Natural gas is used for heating, cooking, and electricity generation, producing fewer emissions than coal or oil.

Renewable Energy

• Renewable energy is derived from naturally replenishing sources.
• Solar energy captures sunlight through photovoltaic panels, a clean and scalable electricity source.
• Wind energy uses wind turbines to convert kinetic energy into electricity and is effective in open land areas with minimal operational emissions.
• Hydropower harnesses water movement, typically through dams, and provides a mature, reliable source, though impacting ecosystems.
• Geothermal energy taps into subsurface heat, offering consistent power output and minimal emissions, but is location-dependent.
• Biomass energy burns organic matter to generate electricity or biofuels, though it produces some emissions.
• Ocean energy, including wave, tidal, and thermal energy, is an emerging field with potential for stable power generation.

Nuclear Energy

• Nuclear energy is produced through nuclear fission, which splits uranium atoms, releasing heat to generate steam and electricity.
• It is a low-carbon source with reliable baseload capacity, operating continuously.
• Challenges include radioactive waste management, accident risks, and nuclear proliferation concerns.

Characteristics of Energy Sources

• Fossil fuels are non-renewable and cause high emissions with substantial pollution.
• Renewable energy is renewable and presents low to moderate emissions, causing potential changes to land and habitat.
• Nuclear Power is non-renewable (uranium), presents low emissions during operation but generates nuclear waste.
• Capital cost for fossil fuels and renewable energy are moderate to high. Nuclear energy is very high.
• Operating cost for fossil fuels is moderate to high based on fuel cost, renewable energy is low based on minimal fuel cost and nuclear energy is low.
• Reliability for fossil fuels and nuclear energy are generally high, though renewable energy is variable.

Key Energy Companies

• Philippines: AboitizPower, San Miguel Corporation, First Gen, and ACEN Corporation.
• Global: Saudi Aramco, ExxonMobil, Chevron, Shell, TotalEnergies, and NextEra Energy.

Top Energy Producing Countries

• The U.S., Saudi Arabia, Russia, China, and India are the leading countries, each varying by resource dominance.

Utilization of Energy Supply Across Sectors

• Residential: Energy for heating, cooling, cooking, lighting, and appliances, with consumption varying by climate, home size, appliance efficiency, and household size.
• Commercial: Energy for space heating, lighting, cooking, and equipment in businesses, schools, and hospitals.
• Industrial: A major consumer for machinery, industrial heating, steam generation, and production in manufacturing, agriculture, and construction.
• Transportation: Fuelled by petroleum products, with biofuels, natural gas, and electricity becoming more prominent.

Common Issues and Challenges in Energy Supply

• Energy Security: Geopolitical instability and supply chain disruptions can cause price spikes.
• Grid Reliability: Aging infrastructure and renewable source integration can complicate grid balance, including extreme weather.
• Price Volatility: Energy prices can fluctuate because of geopolitical events, economic cycles, supply and demand, and renewable sources.
• Supply Chain Constraints: facing shortages of key materials (e.g., lithium, cobalt) and limits on space for large installations.

Sustainability of Energy Supply

• The long-term sustainability of energy systems is tied to their environmental, economic, and social impacts.
• Renewable sources have some environmental challenges in land use and ecosystem disruption.
• Nuclear power has low operation emissions, but challenges regarding radioactive waste disposal and possible accidents.
• Renewable sources like solar, wind, and geothermal are inherently sustainable due to their replenishment and low emissions.

Energy in the Philippines

• Heavily reliant of fossil fuels but with significant renewable energy (geothermal and hydropower) potential.
• The Philippine Energy Plan (PEP) 2020-2040 and the Renewable Energy Act of 2008 policies exist to develop the energy sector.
• Electricity infrastructure is divided into three grids: Luzon, Visayas, and Mindanao.
• Foreign ownership has been allowed up to 100% in renewable energy in the country.

2023 Energy Contributions (Philippines) and Targets

• Coal contributes 60% of power generation, with targets to reduce to 29.1% by 2030 and 21.2% by 2040.
• Oil is 32% of total energy supply, with targets of 32.3% by 2030 and 36.2% by 2040.
• Natural gas accounts for 14% of power generation, aiming for 7.3% by 2030 and 17.0% by 2040.
• Hydropower provides 9% of power generation, with targets of 4.3% by 2030 and 8.9% by 2040.
• Geothermal is 8% of power generation, targeting 14.6% by 2030 and 8.3% by 2040.
• Solar & Wind is 4% of power generation, with goals of 3.3% by 2030 and 3.2% by 2040.
• Biomass & Biofuel is 1% of power generation, aiming for 9.2% by 2030 and 5.1% by 2040.

Future Developments of Energy Supply

• Energy supply is undergoing a transition, with battery storage managing intermittency.
• Hydrogen fuel cells are explored, as well as small modular nuclear reactors and smart grid tech.
• Decarbonization is in motion with goals for net-zero emissions.
• The energy landscape is becoming more diversified with an increase in renewable sources.

Annual and Seasonal Variations

• Energy demand is impacted by climatic conditions and economic activities.
• The Philippines experiences a dry and wet season which impacts energy demand
• Solar energy is generated the most during the dry season , while wind energy is most abundant during the amihan season.
• Climate change is increasing hotter summers, which means increased demand for cooling.

Understanding Supply Variation

• There are are a wide range of factors that can cause fluctuations in power generation including physical, economic, technological, and political.
• Physical factors include geological availability of fossil fuels, like coal, oil, and natural gas. Similarly, the climatic affects renewable resources.
• Economic factors include market prices can influence the economic viability of energy extraction.
• Technological factors help improve the efficiency of power generation. For example, advancements in fracking technology have unlocked access to previously untapped fossil fuel reserves, increasing energy supply.
• Political factors include government policies, regulations, and geopolitical events that have a significant impacts on energy production and trade

Energy markets

• Energy markets are commodity markets where electricity, heat, and fuel products are traded.
• Electricity markets operate at wholesale and retail levels
• Energy prices are driven by supply and demand. When supply exceeds demand, prices drop, and when demand is higher than supply, prices rise.

What are the different supply options (based on generation unit or base by load/ peaking)

• Baseload Plants provide a continuous and reliable supply of electricity, operating at a constant output throughout the day and year.
• Intermediate Load Plants adjust their output to meet moderate fluctuations in demand and fill the gap between baseload and peaking plants during periods of higher demand.
• Peaking Plants are deployed during peak demand periods, these plants can quickly adjust their output.

Dispatchable vs. Non-Dispatchable Energy Sources

• A differentiation in energy supply lies between dispatchable and non-dispatchable sources. Dispatchable, such as fossil fuels, nuclear, hydropower and geothermal resources can be controlled by grid operators to meet electricity needs.
• Non-dispatchable sources, like solar, wind, and tidal, are dependent on environmental conditions and challenging as they are unpredictable. Solutions include energy storage systems, hybrid power plants, and advanced grid management technologies.
• Transmission Equipment for Energy Supply

Generations Availability

• Generation availability is how consistently a power plant can produce electricity
• Several factors influence this plant's ability: the plant's design and fuel type, how often and at what capacity it's operated, and the frequency of maintenance or unexpected shutdowns

What are the capital requirements and operating cost

• Energy supply systems involve significant financial investment, divided into two major cost components: capital costs and operating costs.
• Capital costs refer to the upfront investment needed to build energy generation, transmission, and distribution infrastructure which includes power plant construction, land acquisition, procurement and installation of equipment, grid interconnection and transmission lines.
• Operating costs are the ongoing expenses required to run and maintain energy facilities, which includes fuel costs, labor and staffing, routine maintenance and repairs, insurance and regulatory fees, waste disposal, and grid operation and balancing.