Solar Power vs. Solar Fuels; the cost
The delivered cost of energy as electricity from grid systems varies significantly, through complex cross-pricing and subsidy mechanisms by region, customer sector and time of day consumption. For the UK example an indicative spread is around 14 to 24 p/kWh (plus standing charges), this for a grid currently accommodating around 35% renewables generation, with an overall carbon factor ~180 g/kWh. The further costs to attain a stable ‘zero carbon’ supply based primarily on renewables is the big question, as yet with no clear answer.
The delivered cost of energy as fuel is also distorted, in this case through the significant taxes and duties generally applied, but around 3 to 4 p/kWh is the current economic marker for conventional petroleum fuel options. Their carbon factor range of 180 to 260 g/kWh compares with grid electricity at its current renewables level, when producing power and heating together as in the IUS. For lower carbon, the first generation biofuels are around 6 to 8 p/kWh, but the real scope for supply lies in the ‘advanced biofuel’ technologies emerging in the last decade, based on Nature's constant and widely available supply of biomass residues for feedstock.
Using ligno-cellulosic ethanol as the example, current indicators suggest around 8 to10 p/kWh is feasible (IEA 2020) with developments along the learning curve: higher than current fuels, but lower than for electricity. And also with a directly verifiable carbon factor from individual source to use (cf. grid electricity), with two components: not just the fossil energy consumption it displaces but with carbon sequestration as part of the production process. Should carbon be clearly monetised, this adds a further premium to the value of a biofuel strategy, along with an incentive to make good use of biomass waste rather than leaving it to rot down: anaerobic CH4 emission has a GWP 27 times worse than CO2.
The IUS concept itself can also improve the economics of biofuelling:
In the IUS application the fuel netback value equates to the full set of utility service tariffs it displaces at the point of use, not just the grid electricity; significantly higher in total than the current benchmark of petroleum fuel prices used by biofuel developers.
The costs of feedstock and delivery to centralised biofuel process plants is a major factor, accounting for a third to a half of the projected costs cited above. Transportable IUS facilities could support on-site modular fuel production systems, with the process taken to, and moved around, the feedstock sources as they come available.