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2 Doing Cold Smarter ABOUT THE BIRMINGHAM ENERGY INSTITUTE The Birmingham Energy Institute is the focal point for the University and its national and international partners, to create change in the way we deliver, consume and think about energy. The Institute harnesses expertise from the fundamental sciences and engineering through to business and economics to deliver co-ordinated research, education and the development of global partnerships. The Midlands region is renowned for its ability to drive technology revolution and provide a nationally leading manufacturing base. It is the home of pioneers such as Watt, Boulton and Priestly and the internationally recognised companies of Rolls-Royce and Jaguar Land Rover. The City of Birmingham is setting the green low carbon agenda nationally. Birmingham City Council’s Green Commission launched a Vision Statement with an aim of building a leading green city and reducing CO2 emissions by 60% by 2027 against a 1990 baseline. The UK Government is committed to facilitating a cost-effective approach to meeting the UK’s emissions by at least 80% of 1990 levels by 2050. The Birmingham Energy Institute is working with these stakeholders to realise this transition. INFORMING AND SHAPING POLICY The Birmingham Energy Institute leads the way in providing a sound evidence base to inform policy makers. The Institute draws on the broad capabilities and expertise at the University of Birmingham and its strong relationship with collaborators from academia, industry and the third sector, to generate new thinking on contemporary issues of global, national and civic concern. The policy commissions investigating ‘The Future of UK Nuclear Energy’ (2012) and ‘Future Urban Living’ (2014) have helped shape the thinking of government and policy makers as the UK seeks to transform how it generates and consumes energy. These were led by Lord Hunt of Kings Heath and Lord Shipley of Gosforth. Furthermore, by working with the ‘Industry and Parliament Trust’ academics from the Birmingham Centre for Environmental and Energy Economics and Management, Birmingham Energy Institute Centre, have worked to encourage dialogue between policymakers and academics on sustainability and energy issues. Recently they have contributed to the IPT ‘Sustainability Commission Report’ and the Energy report generated by the Resilient Futures programme. Birmingham Energy Institute academics are also leading work on a White Paper analysing the contribution of fuel cells and hydrogen to UK national energy security and energy affordability that will inform Westminster politics in autumn 2015. There are a number of future energy related policy commissions in the pipeline focussing on innovation, transport and energy markets.
Doing Cold Smarter 3 CONTENTS Chairman’s letter 5 Foreword 6 Acknowledgements 8 Executive summary and recommendations 9 Key recommendations 15 Section 1: Cold: vital but dirty 17 Section 2: Why does the problem persist? 25 Section 3: Doing Cold Smarter: the Cold Economy 33 Section 4: UK plc 53 Section 5: Roadmap 57 Section 6: Policy recommendations 65 Glossary 70 Cooling Timeline 72 Appendix 1: Commission work programme 74 Appendix 2: The Commission 75 Appendix 3: Witnesses 79 References 80 Co-ordinator: Gavin Harper Editor: David Strahan
4 Doing Cold Smarter I JUMPED AT THE OPPORTUNITY TO CHAIR THE UNIVERSITY OF BIRMINGHAM’S COMMISSION ON ‘COLD’ OF WHICH THIS REPORT IS THE PRIME OUTPUT. I HOPE THAT IT WILL KICK-OFF A WIDER POLICY DEBATE, AND OUR RECOMMENDATIONS BECOME THE TIP OF THE ICEBERG WHEN IT COMES TO POLICY FORMULATION AND FUTURE ACTION. LORD ROBIN TEVERSON
Doing Cold Smarter 5 LE T TER FROM THE CHAIRMAN Energy has been at the front of political and academic debate in recent years. We regularly rehearse the arguments over fossil fuels and climate change. In politics the rising cost of energy to power and heat our homes grabbed major attention leading up to the last election. Winter deaths from inadequate house insulation, the cost of nuclear generation, the benefits or otherwise of fracking, energy security, the state of competition between the Big Six – these are all topics that feature in the current discussion around energy. Many even reach the headlines of our daily papers and broadcast media. But one aspect of this debate that seems never to appear on the energy horizon is cold. We are all experts on heat, but when it comes to the 16% or so of our generating capacity that is used to keep our offices, food, cars, medicines, homes and scientific instruments cool, there has been little to say. Having spoken on energy issues in Parliament for seven years I cannot remember one debate, or one piece of legislation that has tackled this growing use of our energy. Out there in the wider world, a lack of refrigeration in developing countries means that food produced by farmers cannot reach markets, and the amount lost to pestilence and high temperatures is far higher: almost 50% of fruit and vegetables are discarded before ever reaching a consumer. But keeping ourselves, our food, and our medicines cool is going to be an increasing challenge. Keeping things cold currently uses some of the more polluting technologies in terms of carbon and other emissions. It is a challenge not just for the warmer parts of the world but us here in the UK too. For all these reasons I jumped at the opportunity to chair the University of Birmingham’s Commission on cold of which this report is the prime output. I hope that it will kick-off a wider policy debate, and our recommendations become the tip of the iceberg when it comes to policy formulation and future action. As the report also shows, we have some real innovators in the UK in cold technologies. Some concentrated attention could mean that the UK plays a major role worldwide in this increasingly important area. Lord Robin Teverson
6 Doing Cold Smarter FOREWORD Cold has been much neglected in the energy debate. Governments are developing strategies and policies to green everything from electricity to transport to heat, but the energy and environmental impacts of cooling have so far been largely ignored. This is a serious oversight, since making things cold is energy intensive and can be highly polluting, and demand for cooling in all its forms is booming worldwide – especially in developing countries. According to one projection, by the end of this century global demand for air conditioning alone could consume the equivalent of half our worldwide electricity generation today – and most of the increase will come in developing markets. The ‘greening’ of cold is clearly an urgent global problem – but it may also offer Britain a massive business opportunity. Cold may have been ignored but is vitally important to many aspects of modern life. An effective cold chain, for example, is essential for tackling problems such as food waste, food security, water conservation and public health. Cooling is also critical for many less obvious but essential functions: data centres couldn’t operate without it, nor for example MRI scanners in medicine or superconductors in power electronics. Cooling also provides modern levels of comfort in hot countries – and can make the difference between some regions being habitable or not. At the same time, vast amounts of cold are wasted – for instance during the re- gasification of LNG – which could in principle be recycled to satisfy some of this demand and start to reduce the environmental damage caused by cooling. Such a system-level approach – which starts by asking what energy services we need, and what is the least damaging way to provide them, rather than accepting existing practices as a fait accompli – has recently been coined the ‘Cold Economy’. It is clear the Cold Economy could unleash a wide range of innovative clean cold technologies and provide energy resilience, economic growth and environmental benefits, but there is an urgent need to develop a system-level analysis of this problem and the potential solutions to inform both industry and policymakers. The Birmingham Policy Commission: Doing Cold Smarter was convened to start this work. This inquiry is rather different from previous University of Birmingham policy commissions, such as those on nuclear power or the future of urban living, where the evidence and arguments were already well rehearsed. By contrast the debate around clean cold is at such an early stage – and good data on cooling hard still to come by – that the Commission restricted itself to tackling a short list of the most fundamental questions:
Doing Cold Smarter 7 1 Should UK plc invest to develop clean cold systems and technologies (rather than simply import them)? a. What would be the impact on Britain’s domestic energy and environmental position? b. What is the scale of the global market opportunity? c. What are Britain’s strengths, weaknesses and competitive position relative to other countries, especially those in the Far East? d. What role could Britain adopt in the global value chain? e. What could be the value to UK plc? 2 If the answer to 1 is ‘Yes’, what is required to enable it to happen from: a. Industry b. Government c. Universities d. Innovation agencies such as Catapults? The answers led the Commission to propose three urgent recommendations for the Government: establish an institutional champion to catalyse the development of clean cold; conduct a Technology Innovation Needs Assessment (TINA) for clean cold; and develop a rigorous system-level analysis of the environmental and financial benefits of the Cold Economy. We also developed a series of more detailed policy proposals, and a high-level technology roadmap to guide next steps and longer term progress – with the support of stakeholders from innovators to end-users. We hope the report and roadmap will prove useful not only to government but also universities, technology developers, industry and customers, and will contribute to the rapid development of clean cold technologies and the Cold Economy. Professor Martin Freer Professor Toby Peters
8 Doing Cold Smarter ACKNOWLEDGEMENTS We wish to thank the many people have who have devoted considerable time and effort to the work of the Commission. These include the Commissioners, who contributed their tremendous knowledge of energy technology, economics, markets and policy; Lord Robin Teverson, who chaired the Commission with the insight and vision needed to keep the proceedings on track; and the witnesses and others who attended individual meetings and workshops. The Commission greatly appreciates the depth and quality of the input from those who attended its evidence gathering sessions. At the heart of any successful process are organisation, planning and efficiency – capably provided by the Commission support team. The views expressed in this report reflect the discussions of the Commission and the input received and do not necessarily reflect the personal views of those who contributed.
Doing Cold Smarter 9 EXECUTIVE SUMMARY AND RECOMMENDATIONS Cold is vital Cold is highly polluting DEMAND FOR COOLING IN ALL ITS FORMS Even in a temperate country such as Yet existing cooling technologies IS ACCELERATING Britain, cooling is everywhere, and vital consume large amounts of energy to many aspects of civilisation: food, and can be highly polluting. The data medicine, energy, data and industry. is poor, but one estimate suggests that refrigeration and air conditioning cause Without cooling, these services would 10% of global CO2 emissions1 – three be impossible to provide, and in many times more than is attributed to aviation parts of the world, life would be scarcely and shipping combined2 – through tolerable without air conditioning. In energy consumption and leaks of HFC developing countries, however, billions refrigerants that are themselves highly of people live without cooling and suffer potent greenhouse gases. Another the consequences daily through hunger estimate, from the German Government, and ill-health. The lack of adequate cold suggests cooling emissions currently storage and refrigerated transport causes account for 7% of the total, but are two million vaccine preventable deaths growing three times faster, so cooling’s each year, and the loss of 200 million share will almost double to 13% by tonnes of food. As the world’s population 2030.3 Diesel powered fridges on heads towards 10 billion by 2050, and refrigerated vehicles also emit grossly with more than 60% projected to be disproportionate amounts of toxic living in cities, there is no question that NOX and PM – many times more than we will need far more cooling. a modern truck propulsion engine. These are two of the key pollutants that contribute to 3.7 million premature deaths through outdoor air pollution worldwide each year.4
10 Doing Cold Smarter Cooling demand is booming We need to ‘do cold smarter’ The Cold Economy: an environmental and business For a technology that is so vital and The environmental impact of conventional opportunity for UK plc yet so dirty, remarkably little is known cooling technologies can be partially for sure about the impacts of cooling; mitigated through existing efforts to Cooling poses a massive environmental governments generally collect and improve efficiency and regulatory changes challenge, but could also represent a publish little official data. But it is clear such as the phasing out of HFC major business opportunity for Britain if that cooling is already a significant energy refrigerant gases in the EU. But these our companies and research institutions consumer and polluter, and is likely to improvements are highly unlikely to deal can establish a global lead in clean cold become massively more so given the with the looming environmental challenge, technologies – potentially creating projected demand growth – especially in part because of entrenched barriers thousands of new British manufacturing in developing countries undergoing including equipment buyers’ focus on jobs. We estimate the Cold Economy rapid demographic change: capital rather than lifecycle costs, even could generate annual global savings of when a more expensive product would between £43 billion and £112 billion – a n The IPCC projects that global air save them money overall, and low levels vast potential market and one which is set conditioning energy demand will of R&D, but also the sheer scale of to grow for the rest of this century. We grow 33-fold from 300TWh in 2000 projected demand growth. Evidence suggest the best way to capture some of to more than 10,000 TWh in 2100, suggests the energy efficiency of cooling this is for Britain to develop its own Cold with most of the growth in developing in some sectors could be raised by Economy, which would not only produce economies.5 10,000TWh is roughly 30% on the basis of best-in-class environmental and economic benefits at half the total electricity generated products and practices alone, but even home, but also serve as a platform for worldwide in 2010.6 if business barriers could be overcome, innovation and exports. n Worldwide energy demand for space this improvement would be utterly cooling will overtake space heating overwhelmed by the projected 33-fold The Cold Economy is a radically new by 2060, and outstrip it by 60% at growth in developing world air approach that applies a system-level the end of the century, as cooling conditioning demand. We clearly need analysis to recruit vast untapped demand in the developing countries to do cold smarter, and we believe the resources of waste cold, ‘free’ cold, waste of the global south grows faster than answer is to radically improve efficiency heat, renewable heat, and ‘wrong-time’ heating demand in the developed by developing a new ‘Cold Economy’. energy – such as wind or nuclear power northern economies.7 n The European Commission expects cooling demand in EU buildings to Financial rise 70% by 2030.8 savings through n Chinese consumers bought 50 million rational use of air conditioning units – equivalent to resources half the entire US domestic air conditioner fleet – in 2010 alone.9 n The worldwide refrigerated vehicle fleet could grow from around 4 million10 today to as much as 18 million by 2025 to satisfy currently unmet demand in developing countries.11 In the EU, the Growing demand/ Need to Economic growth pollution caused costs of transport need for cold ‘do cold through step-out refrigeration have been forecast to services smarter’ innovation rise to €22 billion by 2025.12 n If nothing is done, within 15 years cooling will require an additional 139GW – more than the generating capacity of Canada – and raise greenhouse gas emissions by over 1.5 billion tonnes of CO2 per year, Environmental improvements three times the current energy emissions of Britain or Brazil.13 Figure 1: The need to do cold smarter
Doing Cold Smarter 11 produced at night when demand is low – The Cold Economy approach is powerful security; and create business to radically improve the efficiency of in part because it recognises that there opportunities, growth and jobs. Making cooling, and reduce its environmental is no demand for cold per se, but for use of all the recoverable waste cold impact and cost. These waste or surplus services that depend on it such as chilled from projected UK LNG imports in 2030 resources can be used to provide cooling food, comfortably cool rooms in hot could in principle increase the country’s by converting them into a novel ‘vector’ – climates and online data. This approach overall efficiency of cooling eight-fold and a means of storing and transporting cold turns our thinking about cooling on its reduce costs by £1 billion or 20%. – such as liquid air or nitrogen. A key head. For the first time we are asking insight of the Cold Economy is that ourselves ‘what is the energy service we The direct benefits of the Cold Economy energy can be stored and moved as cold require, and how can we provide it in the to Britain appear significant, but rather than converted into electricity and least damaging way?’, rather than ‘how are likely to be dwarfed by those to then converted again to provide cooling. much electricity do I need to generate?’. the developing world, because of The Cold Economy is less about individual This can lead to far greater integration of the sheer scale of projected cooling clean cold technologies – although these cold demand with sources of waste cold demand growth, and the severity of the are vital – and more about the efficient and heat, and ‘wrong-time’ low carbon environmental impacts of a business as integration of cooling with waste and energy; the use of cryogens as vectors to usual approach in those countries. The renewable resources, and with the wider store and transport cold and power; and potential export market for clean cold energy system. It recognises the scale of the development of more efficient technologies and know-how looks vast, cooling demand growth and the need to technologies, practices and materials. and we suggest that building a Cold pre-empt its environmental impact, and Economy at home is the best way to the opportunities this will generate. We believe the benefits of this approach ensure Britain captures a significant slice. will be to reduce costs, CO2 and local air This requires both new policies from Evidence to the Commission suggested pollution; improve energy and food government, and a technology roadmap. a four-stage approach to doing cold smarter, culminating in the Cold Economy: 1 Reduce cold load/cooling work required: eg better building design, vaccines that survive at higher temperatures; 2 Reduce the energy required for cooling: ie increase the efficiency cooling technologies – eg. cold stores could raise efficiency by an average of Managing cold Making 30% using off the shelf solutions only14 cold – and reduce the global warming potential (GWP) of refrigerant gases; Storing 3S ystem-level thinking/Cold Economy: cold a. Harness waste resources: ‘wrong- time’ renewables; waste cold (LNG); waste heat, or renewable heat from Moving biomass or ground-source heat pumps; cold system integration across buildings and transport; b. Cold energy storage to warehouse and shift wrong-time energy Using to replace peak electricity demand cold and diesel consumption; 4 Having thus minimised energy demand, convert remaining cooling loads to sustainable energy sources. Figure 2: An integrated approach to cold
12 Doing Cold Smarter How to reach the Cold The roadmap focuses on driving The roadmapping exercise revealed Economy: Roadmap new thinking in key areas at least six groupings of industries and applications that for which the Cold The roadmap for cold is intended to Making cold Economy would generate value: describe what is required to develop n Harness waste/unused resources e.g.: a vibrant British clean cold industry that – ‘wrong-time’ renewable energy – Built Environment: Building energy, will not only dramatically improve the (e.g. wind) local-scale energy buffering and power environmental performance of cooling – waste cold (e.g. LNG) generation, air conditioning, data in this country, but also establish and – ambient heat and cold centre cooling, warehouse refrigeration maintain a lead in a new global market (e.g. ground-source) – Transport: Propulsion, waste heat potentially worth £ hundreds of billions. recovery, interaction with ICE and It is a high-level industry roadmap, Storing cold electrochemical systems, LiAir, LN2, developed by the Commission and n Thermal energy storage to warehouse LH2 LNG or NH3 as a fuel, provision external experts. It is technology agnostic of a/c from cold and resolutely practical: it does not fix Moving cold – Cold Chain: Transport refrigeration, its eyes solely on what might be achieved n New energy vectors and material depots, retail and medical from blue-sky technologies in 15 years, to shift cold – Industrial process: Industrial Gases but is equally occupied with the significant and Processes, LNG and LH2 import short-term gains from improved Using cold and distribution, industrial-scale maintenance of existing equipment – n Reduce cold loads chilling and freezing processes and all the steps in between. n Increase efficiency and reduce GWP – Advanced: Superconductors, of conventional technologies nanotechnology, other fundamental The aims of the roadmap are to n New technologies to harness novel or advanced concepts reduce consumption of non-renewable thermal stores and energy vectors natural resources, pollutant emissions, The results of the roadmapping exercise greenhouse gases (CO2, refrigerants) and Managing cold are summarised in Figures 3 and 4. the total cost of ownership for equipment n Data monitoring operators, but at the same time generate n Intelligent controls economic value to UK plc through n System-level management improved productivity and exports, and social benefits for emerging economies through the creation of clean cold chains. THE COLD ECONOMY Transition inventions to new system-level architecture delivering environmental and economic gain COLD AS A SERVICE THE COLD ECONOMY business models New focus is on customer Harnessing renewable, natural Leverage new service requirement and how resources and waste cold of best to use energy, not simply LNG to create new intergrated electricity generation clean cold energy systems DRIVERS Policy and greater percentage of UK research and research funding STEP CHANGE CURRENT Leverage existing business models i Optimisation and new First generation technologies engine geometrics delivering clean cold and power ii Small-scale liquefaction for multiple BE and aux engine iii New higher energy density applications (TRU/Air Con) thermal storage materials Leverage existing technologies Leverage new technologies Figure 3: Transitional stages to the Cold Economy
Doing Cold Smarter 13 Reduction in CO2 footprint Drivers for Change Increased pollution from NOX and PM Transition to lower GWP refrigerants Increased demand for cooling Availability of cryogens and other novel vectors Integration of cooling and cold as an energy vector Expansion of UK manufacturing and jobs Higher Efficiency Cooling Technologies (increased COP) Technology Innovations Development of new, low GWP, refrigerants and phase out of HFCs Cold energy storage materials; high density, long term storage, rapid cycle White goods linked to district cooling schemes Novel refrigeration and cooling technologies; magnetic, electro, sorbtion Integration of thermal energy technologies delivering heating and cooling Advanced cryogenic technologies; e.g. zero boil off systems Enhanced heat pump technology Greater exploitation ground-source heat and waste heat LNG re-gasification and liquid air liquefaction opportunities Cross over Grid balancing and district cooling and heating Vehicles: Liquid air – LN2 – LH2 systems Advanced superconductor technologies in power systems Food refrigeration and transport with liquid air generation and use Development of cold and cooling as a product; move from technology focus Create appropriate incentives and regulatory framework Introduction of market mechanisms that allow new technologies to break through Interventions Small and large scale demonstration facilities for proof of principle and validation Manufacturing environment to accelerate price competitive technologies to market Explotation of state-of-the-art manufacturing processes and data Develop a service culture and infrastructure related to cold technologies Development of R&D capability on a scale which matches potential of cold Develop@ UK skills base linked to state-of-the-art cold systems Figure 4: Steps towards a cold economy
14 Doing Cold Smarter How to reach the Cold Economy: policy Global market need Technology shifts recommendations Rapidly increasing UK innovation in There is a strong case for the British demand for cold and The opportunity producing, storing Government to take the lead and develop cooling of all types and using cold a comprehensive policy around clean globally, especially There is a real chance cold, both to further its strategic aims for in the rapidly for the UK to maintain Increasing use energy and the environment, and create emerging and the initiative and take of cryogenic a platform for innovation and exports that developing the lead in this rapidly fuels natural gas could help Britain secure a lead in what emerging global economies and hydrogen promises to be a major global market. commercial market. Growing recognition Rising use of Developing policy on cold would deliver: of its energy demand renewables and need and environmental for grid balancing n Reduced costs to industry and footprint consumers: E4tech estimates that doubling Britain’s cooling efficiency through the Cold Economy could save Figure 5: Why develop policy on cold? the country around £1 billion; n Reduced CO2 emissions: key is deploying more efficient, low carbon technologies; n Exports, growth, jobs and skills: cooling is poor. For this reason our five n Energy security: raising cooling if the immediate benefits from greening key recommendations are intended to efficiency reduces the electricity Britain’s cooling are worth £1 billion raise awareness of the importance of required, and would therefore as E4tech estimates, we would expect clean cold and improve the data and improve capacity margins; potential value of supplying clean cold analysis of the cooling system in Britain. n Grid balancing: some clean cold to the global market to be many times If these are accepted, we propose a technologies incorporate thermal higher. Based on the estimated value further series of more detailed proposals. energy storage, meaning they can of clean cold to Britain, scaling by For a full description of our key and help reduce peak electrical loads GDP produces a global value of £43 additional proposals see Sections 5 on hot days; billion, and scaling by population gives and 6 of the main report. n Food security: improved cold a global value of £112 billion.15 Even at chains would reduce food loss the lower figure – which takes no worldwide, so helping to constrain account of projected cooling demand food price rises in both developing growth in developing countries – and developed countries; the opportunity is enormous. n Air quality and health: existing transport refrigeration and diesel Many areas of policy clearly need work, generators emit grossly particularly in light of the barriers to clean disproportionate amounts of NOX and cold, which could be cleared by PM; the profile of toxic air pollution is government intervention. But although the rising rapidly following the Volkswagen case for developing detailed policies is emissions testing scandal, while recent compelling, we believe there are more court judgements that oblige Britain fundamental issues to resolve first. Existing transport refrigeration and diesel to submit a new air quality strategy to Awareness of the need for clean cold is generators emit grossly disproportionate Brussels by the end of this year; woeful, for example, and the data around amounts of NOX
Doing Cold Smarter 15 KEY RECOMMENDATIONS 1 Raising awareness and 2 Technology Innovation 3 System-level model long term commitment Needs Assessment of UK cold for cooling We believe government has a major This Commission has produced a first-take role to play in raising awareness of the Technology Innovation Needs analysis of cooling demand and resources environmental and economic importance Assessments (TINAs) are carried out by in the UK. But a proper understanding of of cooling. If the Government makes the Low Carbon Innovation Co-ordination the potential of the Cold Economy requires clear its long term commitment to the Group (LCICG), whose core members a more detailed and definitive model to adoption of clean cold technologies it include DECC, BIS, the Engineering and be developed. This model should use will increase the confidence of investors. Physical Sciences Research Council whole-system methodology to evaluate the We urge the Government to: (EPSRC), the Energy Technologies reduction in system cost – financial and Institute (ETI), Innovate UK and the Carbon environmental – that could be achieved by n Establish a lead department with Trust. TINAs are intended to identify and deploying new cooling technologies. responsibility for clean cold. Since value the main innovation needs of specific cold touches so many aspects of the low-carbon technology families to The whole-system approach is required energy system, the environment and inform the prioritisation of public sector because the potential benefits stretch far the economy, the development of investment in low-carbon innovation. Each wider than those enjoyed by the individual policy should involve several arms TINA analyses, estimates or identifies: owner or user of clean cold technologies. of government – DECC, Defra, BIS, These benefits span transport, food, DfT and the Treasury – but we n the potential role of the technology buildings, industry and energy, and include: recommend that a single department in the UK’s energy system lower costs; reduced emissions of should take ownership of this issue n the value to the UK from cutting greenhouse gases, NOX and PM; and and co-ordinate with the others. the costs of the technology through improved grid resilience resulting from n Appoint an institutional champion innovation reduced cooling loads and increased use for clean cold: we recommend the n the value to the UK of the green of wrong-time renewable energy and Energy Systems Catapult should growth opportunity from exports waste heat and cold. adopt clean cold as one of its themes, n the case for UK public sector and act as a co-ordinating body for intervention in innovation We recommend that Research Councils, analysis and development of clean n the potential innovation priorities to Innovate UK and the Government jointly cold technologies in Britain. deliver the greatest benefit to the UK fund a study to assess the social benefits n Develop a concordat for the UK of implementing the measures outlined in cooling and refrigeration industry: These are precisely the questions that this report. We expect this work would that encourages the development need to be answered around clean cold. take a two-step approach: first to of products with high-efficiency, TINAs have already been conducted for understand the cold value chain in more low levels of pollution and carbon ten energy sectors including an analysis depth, and second to integrate this into impact, establishing UK industry of heating, which concluded innovation whole systems models. For more detail as best-in-class. could reduce UK energy system costs by see section 5 of the full report. £14–66 billion and raise GDP by £2–12 billion to UK GDP to 2050. As we argue A truly system-level model of cooling in above, the value of clean cold technology Britain would inform decisions in policy exports to developing countries – which and research funding and provide the almost all have hot climates – could be evidence to ensure interventions are far higher.16 directed where beneficial impacts are most likely. Building and integrating such models would start with the UK, but could then be extended to other markets. It would therefore highlight the value of clean cold technology innovation in developing export opportunities for business.
16 Doing Cold Smarter KEY RECOMMENDATIONS 4 Support demonstration 5 Measurement and projects management of clean cold The environmental benefits of clean It is axiomatic that `you cannot manage cold technologies are likely to be what you cannot measure’, and many significant in Britain, but those in the users of cooling have very little idea about developing world will be enormous, and how much energy they are consuming, the economic value of satisfying those the efficiency or inefficiency of their needs equally large. For this reason equipment, and how much pollution they government should consider supporting are causing. This is true for individual clean cold demonstration projects, both cooling applications but probably even in Britain and abroad, as a platform for more so at the level of an entire company. future exports. In Britain, such projects Some large consumers of cold may have could explore ways of measuring cooling a clear idea of their cooling energy demand and aggregating cooling loads consumption but perhaps much less – for instance between a hotel, data of their cooling requirement (coolth). centre and logistics business – to build We believe this requires the development a viable business case. In Africa, they of a new broad measure of the energy could simultaneously demonstrate efficiency and environmental impact of effective ways to reduce postharvest cooling, by which companies can judge food loss – and the consequent waste their progress and performance relative of land, water and energy, and needless to their peers, which may also help them emission of CO2 – while laying the identify cooling loads that could be foundations for future economic growth aggregated and therefore supplied more and British jobs. efficiently through district cooling schemes. The Coefficient of Performance (CoP) used for individual appliances is too narrow a measure, and we favour a broader indexed approach capturing energy consumption, emissions (CO2, NOX, PM) and whether the energy source worsens or mitigates peak load. The Government should consider leading the development of a broad metric of the energy and environmental impact of cooling and promoting it among companies on a voluntary reporting basis.
Doing Cold Smarter 17 SECTION 1 COLD IS VITAL BUT DIRTY
18 Doing Cold Smarter COLD IS VITAL BUT DIRT Y Cold is vital n Data and telecoms: Data In short, in developed countries, life centres consume 2–3% of Britain’s without cooling is almost unthinkable. Even in a temperate country such as electricity, and half of that is for But in many parts of the world, people Britain, cooling is everywhere, and vital to cooling21, without which the internet understand only too well what the many aspects of modern life. Without it, would quickly collapse. Global absence of cooling means because they the supply of food, medicine, power and data centre power consumption live with it daily. In fact, a lack of cold data would simply break down. It is no almost quadrupled between 2007 can be seen as the hidden link between exaggeration to say that if cooling were and 2013 to 43GW22, roughly several apparently separate looming somehow suddenly withdrawn from the generating capacity of South global crises – food, energy and water advanced economies, life would quickly Africa.23 At this growth rate, by – as the population heads to perhaps become extremely difficult. Here is what 2030 the additional cooling load 10 billion by 2050. we would have to do without: would require another 35GW of generating capacity, or more than Demand for food is projected to grow n Food: Much of our food depends on that of Poland.24 by 40% by 2030 and 70% by 205028; the ‘cold chain’, a seamless network of at the same time The Food and refrigerated warehousing, sea- n Air conditioning: Vital for modern Agriculture Organization of the United containers and trucks that stretch from levels of comfort in many parts of the Nations (FAO) estimates that about a the farm gate – which could be in Asia, world including the United States, third of all food is lost to wastage Africa or Latin America – to the where over 80% of homes25 and worldwide.29 Most food is lost between supermarket display cabinet. 70% commercial buildings26 are equipped, farm and retailer, and the problem is of foods are chilled or frozen when and the Middle East and Asia. greatest in the developing world.30 The produced17, and 50% are retailed using Skyscrapers worldwide would be International Institute of Refrigeration has refrigerated display, and increasing uninhabitable without it. Car air estimated that if developing countries had amounts are delivered to your doorstep conditioning in the US consumes same level of cold chain as developed, by refrigerated home delivery vans. The an estimated 7–10 billion gallons they could save 200 million tonnes total value of refrigerated food sold in of petrol per year. of perishable food or 14% of the food the UK is around £56 billion per year18, supply.31 Another study found that halving and the value of food transported cold n Energy security: Production of food wastage could feed an extra 1 billion worldwide in 2002 was $744 billion.19 Liquefied Natural Gas (LNG) and people32, which is comfortably higher Domestic refrigeration is the biggest other cryogenic fuels depends on than the 800 million who were chronically consumer of cooling energy in the UK, industrial scale cooling. The global undernourished in 2012–14. The lack at around 13TWh per year or 4% of trade in LNG is forecast to reach of cooling not only worsens food security UK electricity. 500mtpa by 2025 – the equivalent but also food safety: low level food of ten times total current UK gas poisoning is an endemic problem in n Fertilizer: Cooling is a vital step in the consumption27 – and is vital to the much of the developing world.33 Haber-Bosch process that converts energy security of many countries. atmospheric nitrogen into ammonia The consequences of such colossal fertilizer, credited with producing the n Industry: Cooling is essential to wastage spread far beyond hunger and food to feed 3 billion people – almost produce industrial gases such as inflated food prices. The FAO estimates half the world’s population. Put another oxygen for steelmaking, chemicals, that total food wastage occupies a land way, this process provides all the food plastics, industry and hospitals, area the size of Mexico; consumes 250 eaten every second day. and nitrogen for fire suppression. km3 of water per year, three times the volume of Lake Geneva; and accounts n Medicine: Many vital medicines and n Science: The Large Hadron for 3.3 billion tonnes of carbon dioxide treatments require refrigeration to Collider at CERN in Switzerland emissions, making it the third biggest produce or transport – including the depends on cryogenic cooling; as emitter after the US and China.34 In other world’s biggest selling medicine, the do Maglev trains and the fuel for words, if cold chains in the developing anti-cholesterol drug Lipitor.20 MRI space rockets. Cryogenic cooling world could be brought up to the levels of scanners could not work without the touches around 17% of the those in the developed world, the benefits extreme cold of liquid helium. British economy. would extend far beyond the immediate
Doing Cold Smarter 19 reduction in wastage, hunger and rising the electricity they consume, and leaks million refrigerated vehicles will emit food prices. They would even extend of HFC refrigerants, or ‘F-gases’, which 13mtCO2e in 2015 from diesel and beyond agriculture, resources and are highly potent greenhouse gases. F-gas leakage combined.45 climate: 25% of all vaccines arrive damaged or degraded35, and two million It is the high global warming potential This last report, Liquid Air on the people die each year from vaccine (GWP) F-gases that have captured the European Highway, also found that preventable diseases simply because attention of policymakers, and it is easy to refrigerant leakage accounts for 17% of inadequate refrigerated distribution.36 see why: the most commonly used F-gas, of the lifecycle emissions of a transport R404A, is 3,922 times more powerful refrigeration unit (TRU), and diesel It is clear that cooling matters. than carbon dioxide, meaning that a leak consumption for around 90% of the of one kilogramme of refrigerant has rest – i.e. 75% of the total. So although the same global warming impact as four it is clearly important to minimise and …but cold is also highly tonnes of carbon dioxide. But although eventually eliminate F-gas leakage polluting the emissions from F-gas are grossly or use, it is even more important to disproportionate to the volumes of eliminate the CO2 emissions from gas leaked, the bulk of cooling emissions energy consumption of refrigeration, The current environmental footprint still come from energy consumption. which suggests the need to develop of cold – greenhouse gases Academics at LSBU estimate that entirely new refrigeration cycles Cooling is important not just because it 25% of the global warming impact of and technologies. supports civilised life, but also because refrigeration and air conditioning is due to it consumes large amounts of energy F-gas leakage and 75% due to emissions In short, cooling is not only vital but and takes a heavy toll on the environment from power generation and diesel.40 also highly damaging to the environment through emissions of greenhouse gases The EU regulations introduced this year and health, causing high emissions, and toxic air pollutants. Academics will reduce the volume of high GWP greenhouse gases and toxic air pollutants. at London South Bank University F-gases available to scarcely 20% In contrast to the widespread perception, (LSBU) estimate refrigeration and of current levels by 2030, meaning that however, the greater part of that pollution air conditioning (RAC) consumes energy will soon represent more than from cooling devices comes from their around 16% of UK electricity and is 90% of the sector’s GHG emissions.41 energy consumption rather than leaks responsible for 10% of global CO2 of refrigerant gases. emissions37 – which is three times The amount of energy consumed by more than is attributed to aviation and cooling in individual sectors is significant. The current environmental footprint shipping combined.38 Another estimate, We estimate Britain’s supermarkets of cold – toxic air pollution from the German Government, consume around 9TWh of electricity Some cooling applications are also suggests cooling emissions currently per year, of which around 3.6TWh – or responsible for large emissions of account for 7% of the total, but are 1% of the country’s power – goes on toxic air pollutants including nitrogen growing three times faster, so cooling’s cooling42, and the internet is another oxides (NOX) and particulate matter share will almost double to 13% huge consumer of cold. On the roads, (PM). These are the pollutants that by 2030.39 refrigerated vehicles are also big polluters. cause up to 52,500 premature deaths Work by Professor Savvas Tassou at in Britain each year according to recent The main culprit is the vapour Brunel University suggests that transport government estimates46; over 400,000 compression refrigeration cycle – the refrigeration consumes up to 20% of in the EU47; 600,000 in India48; and overwhelmingly dominant means of a refrigerated vehicle’s diesel, and is 3.3 million worldwide49 – more than cooling – which was invented in 1805, therefore responsible for a fifth of its die from malaria and HIV Aids combined50. commercialised for industrial uses well-to-wheels CO2.43 Professor Judith Cooling contributes to these emissions towards the end of the 19th century, and Evans at LSBU calculates that in Britain through the use of electricity generated spawned the global boom in domestic transport refrigeration causes emissions by coal fired and to a lesser extent fridges and air conditioning ever since. of around 2mtCO2 per year from diesel gas-fired power stations, transport The lifecycle greenhouse gas emissions consumption alone.44 In Europe, a report refrigeration units and diesel electricity of refrigeration devices comprise the CO2 from Dearman, a clean cold technology generators known as ‘gensets’. emitted by power stations that generate developer, found that the EU’s fleet of 1
20 Doing Cold Smarter Fridges on trucks, trailers and vans are technologies based on energy storage chain investment is also booming in India, powered by electricity generated by that separate the generation of cold in where annual revenues from the sector are burning diesel. For vans and smaller time from its consumption. forecast to reach $13 billion by 2017.62 trucks this may be via an alternator or This correlation should come as no compressor mounted directly on the In short, we would need to develop clean surprise: as people’s incomes rise, they propulsion engine, but for most trucks cold technologies on the basis of its naturally buy the appliances and services and virtually all trailers, the power is current impact on the environment and that improve the quality, safety and variety produced by an entirely separate diesel health, even if global demand were static. of the food they eat. engine. In Europe these auxiliary engines But it is not: cooling demand is set to are essentially unregulated and therefore grow dramatically. The sharp slowdown in the Chinese inefficient and highly polluting. economy this year may of course slow the growth in demand for cooling for a time, Analysis conducted by E4tech, the And demand is booming but the demographic factors supporting clean energy consultancy, for Dearman, future growth in the developing world look has found that auxiliary transport Cold matters not only because it is vital irresistible. The population growing fast; refrigeration units can emit up to six times to modern life, and currently imposes the middle class in Asia is expected as much NOX and 29 times as much PM heavy costs on health and the environment, to swell from around 500 million people as a Euro VI truck propulsion engine.51 but also because demand for cooling is today to 3 billion people by 2030, two As a result, a recent report from Dearman set to soar. There are several causes, thirds of the global total63; and in some found that in 2015 the European TRU including rising temperatures due to countries the population is getting fleet would emit 40,000 tonnes NOX, climate change, feedback loops caused younger and therefore more productive. equivalent to over 26 million Euro 6 by current cooling technologies, and Urbanisation proceeds apace: Goldman diesel cars, and 5,000 tonnes of PM, structural economic growth in developing Sachs expects India’s cities to swell by equivalent to 56 million Euro 6 diesel countries causing the emergence of a 500 million people over the next 25 years, cars.52 The analysis found that if nothing huge new middle class. and the UN forecasts the global urban is done the cumulative social cost of those population will rise from 3.9 billion emissions – including health costs, the Structural growth in the in 2014 to 6.4 billion by 2050 or 66% value of the years of lost life and output, developing economies of the total.64 and damage to crops and buildings – By far the strongest driver of global will rise to over €7 billion by 2025.53 demand for cooling in the short to All this should tend to increase demand for medium term is the tectonic shift in western-style diets and levels of comfort, In developing countries such as India, the demographics of developing most of which depends on cooling. where electricity grids are weak and economies – which is already having power cuts a daily occurrence, cooling a dramatic effect. The rapid growth in cooling demand in loads are closely connected to the developing countries is driven not only by use of diesel gensets, which like TRUs The emerging markets boom of the last shifting demographics, but also by a are highly polluting. Blackouts happen three decades is a familiar story. Less yawning need: primarily the imperative to because the country has too little primary well known is the surge in cooling reduce food waste in order to feed a generating capacity, and cannot cope that has been an integral part of that population of 9 or 10 billion by 2050 – with daily demand peaks that are largely expansion. In China, for example, fridge it’s estimated that halving food wastage driven by air conditioning demand – ownership among urban households rose could feed an extra 1 billion people.65 And which Tata Power estimates accounts for from 7% to 95% between 1995 and the International Institute of Refrigeration 40% of total consumption.54 As a result, 200757; and cold storage capacity soared (IIR) estimates that if developing countries many commercial customers have installed nine-fold from just 250 million cubic had the same level of refrigerated diesel gensets to protect themselves feet to more than 2 billion in the three transport and warehousing as found in from the country’s frail grid – and these years to 201058, and is on track to more the developed world, 200 million tonnes units now account for more than 90GW, than double again by 2017.59 Chinese of perishable food would be saved each or 36% of India’s total power generation consumers bought 50 million air year – or 14% of the food supply.66 capacity.55 Gensets in India are typically conditioning units – equivalent to half used far more often – on average 500 the entire US domestic air conditioner Despite the strong growth in the hours per year – than those in developed fleet – in 2010 alone.60 developing giants, cold chains remain economies such as the UK.56 Since much rudimentary or non-existent in most of this capacity will be turned on as a China’s cold chain business is reported to developing countries, meaning that in consequence of cooling demand, there be growing at 25% per year and projected India just 4% of fresh produce is is a clear need to develop cooling to be worth $75 billion by 2017.61 Cold transported cold67, compared to more
Doing Cold Smarter 21 than 90% in the UK. China meanwhile considered mature such as the US – In any event, the European Commission has an estimated 66,000 refrigerated where home air conditioning already expects cooling demand in EU buildings trucks to serve a population of 1.3 billion, accounts for 8% of the electricity to rise 70% by 2030.76 And the IPCC, in compared to France which has 140,000 generated for all purposes, costing its reference scenario, projects that global to serve 66 million.68 At the same time, consumers $15 billion per year, and air conditioning energy demand will grow new food safety regulations come into causes emissions of around 196 33-fold from 300TWh in 2000 to more force in China this year that mean 20% of million tonnes, or 2 tonnes per household than 10,000 TWh in 2100. The IPCC fresh fruits and vegetables, 50% of meat with air conditioning.73 According to says most of the growth will occur in and 65% of seafood will now have to be another estimate, US air conditioning developing economies, and 25% will be transported by cold chain, compared to accounts for 20% of home electricity due to climate change.77 10,000TWh is 5%, 15% and 23% today.69 So there is consumption and 13% of commercial roughly half the total electricity clearly massive headroom for growth. demand, which together represent generated worldwide in 2010.78 more electricity than is generated in The Chief Executive of India’s National the entire continent of Africa for all Energy demand for heating will also Centre for Cold-chain Development, purposes.74 Energy consumption may increase, of course, but less quickly, Pawanexh Kohli, who gave evidence rise proportionately more than cooling because the northern economies where before the Doing Cold Smarter load, since cooling equipment is heating is required are generally wealthy Commission, estimates India has typically sized to meet peak load. Peak enough – bar the poorest households – perhaps 9,000 refrigerated trucks, temperatures are likely to rise more than to afford it already. As a result, the energy far too few to service its 31 million tonnes average temperatures, and appliances required for space cooling worldwide is of cold store capacity. To make proper are typically less efficient when operating set to overtake that for space heating by use of just 10% of the cold store capacity, at part load – which is most of the 2060, and by the end of the century he calculates the country needs to build time. Defra projects that the average cooling will consume 60% more energy 30,000 new pack-houses with pre-cooling British summer temperature is likely to than heating according to the Netherlands facilities, and needs 60,000 refrigerated rise 3C to 4C by the 2080s.75 Environmental Assessment Agency. trucks on the road at any one time.70 By extension, making proper use of all of India’s cold storage capacity would require 600,000 refrigerated trucks. Taking a broader international perspective, if India had the same ratio of refrigerated vehicles to the value of its grocery market Figure XX World forecast energy demand for space heating and space cooling World energy demand, exajoules ($375 billion in 2012) as Britain ($243 billion), it would have 129,000 refrigerated 50 vehicles, 18 times more than at present.71 And if it had the same ratio of refrigerated Air conditioning trucks to population as Britain, its fleet 40 would number more than 1.5 million.72 Either way, the growth potential is huge. This headroom for growth exists across 30 many forms of cooling, and the projected growth rates are prodigious. If the current and future demand for cooling services 20 in developing countries were satisfied using conventional technologies, however, the environmental and health impacts 10 described in the sections above could be enormous. FORECAST Climate change 0 As global temperatures continue to rise 1971 2000 2020 2040 2060 2080 2100 the demand for cooling is bound to Source: PBL Netherlands Environmental Assessment Agency. The opinions stated include some forecasted views. increase, even in developed countries Figure 6: Worldwide We believe forecast that we are basing energyand our expectations demand beliefs onfor space assumptions reasonable heating and space within cooling, the bounds of what where the cooling market might be exajoules. we currently Source: PBLthere know. However, Netherlands Environmental is no guarantee that any forecasts Assessment or opinions will beAgency realized. 79
22 Doing Cold Smarter Feedback loops Rising demand for (diesel powered) high pressure to lower pressure pipelines. Cooling demand will also rise inexorably Transport Refrigeration Units (TRUs) LNG produces so much waste cold if we do not change course, as a result and bus air conditioning can only because natural gas producers such as of two feedback loops. One is obvious worsen the heat island effect: adding Qatar, Egypt and Australia liquefy natural and global: the more fossil fuel we burn air conditioning to a double-decker gas by cooling it to –162C in massive to keep ourselves and our food cool, the bus in hot countries such as India industrial liquefiers (known as ‘trains’ more carbon we will emit, the hotter the could raise its fuel consumption by because they stretch up to a mile long) planet will become, and the more fossil almost 50% according to one vehicle in order to shrink the gas to a manageable fuel we will need to burn to keep cool. manufacturer. The answer here is volume for transport by supertanker. For example, Saudi Arabia burned a not electric vehicles, however, since Once delivered to an import terminal in record 1 million barrels of oil per day the cooling load in hot countries would a consuming nation such as the UK, the to generate electricity in July 201480, severely deplete the vehicle’s range. LNG must be re-gasified before entering and more than 50% of Saudi summer This suggests the need to develop the pipeline network. Although the waste peak power demand is driven by air cooling technologies that do not dump heat of power generation plants is conditioning.81 This cycle clearly needs their rejected heat into their immediate sometimes used to warm the gas, import to be broken, both in the Kingdom and environment, nor draw on the vehicle’s terminals generally burn some of the gas more generally. propulsion energy. to warm the remainder or use sea water as a source of heat. Either way, vast amounts The other feedback loop is less obvious The potential of untapped of cold are lost to the environment. and more localised, and relates to the way resources current cooling technologies contribute In Britain, if only half the cold thrown to the heat island effect. Cities create While the environmental impacts of away in this fashion could be recycled, heat islands because heat from the sun is cooling are already heavy, and demand it would amount to almost 20TWh of absorbed by tarmac and concrete, forcing is projected to soar, there are also ‘coolth’, or more than a fifth (22%) of cooling equipment to work harder. But enormous waste resources that could our current cooling demand, and save air conditioners reject heat into their local be recycled to dramatically reduce the around £1.3 billion in operating costs, environment, so raising temperatures and damage caused by our cooling needs. according to evidence from E4tech, the creating the need for yet more cooling. sustainable energy consultancy. On the In Phoenix, Arizona, for example, the Waste cold basis of projected LNG imports, the heat island effect has already raised Vast amounts of cold of are lost to the ‘recoverable’ waste cold in 2030 – half temperatures by over 4C, towards the environment during the re-gasification of the actual resource – could be 80TWh, upper end of the warming predicted for Liquefied Natural Gas (LNG) at import almost matching today’s UK demand the entire planet through climate change.82 terminals, for example, and at gas ‘let for cooling power. More generally, it has been estimated down’ stations, where gas moves from that this effect is responsible for 5–10% of urban peak electricity use for air conditioning in US cities.83 90 80 Vehicle exhausts also dump heat into the environment, forcing both vehicle 70 and building air conditioners to work harder still. One study found that if 60 Coolth (TWh) Beijing had switched from fossil fuel to 50 electric vehicles – which produce 80% less heat – during the summer of 2012, 40 temperatures in the city would have 30 been reduced by 1°C. This in turn would have cut electricity consumption 20 by 14.4GWh and CO2 emissions by 11,800 tonnes per day.84 10 0 Current exploitable 2030 exploitable Current estimated wasted cold wasted cold UK cold needs Figure 7: UK exploitable ‘wasted’ coolth and coolth demand. Source: E4tech/Dearman Demand Let-down stations LNG terminals and peak shaving
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