“It's a free society. But don't tell the world that we can feed the present population without chemical fertilizer. That's when this misinformation becomes destructive.” – Norman Borlaug

I read with a mix of bewilderment and predictable annoyance the ongoing coverage by Zerohedge of the natural gas crisis in the United Kingdom. In it, a cascading series of consequences, the severity of which are yet to be seen, are laid bare as the competing forces of politics, science and economics are lined up to produce a lowest common denominator outcome for society. Apologies to the hapless windmill, but How Policy by Platitude and Financialization of Critical Industries by Spreadsheet Ninjas (Almost) Spoiled Supper just doesn’t have the same ring.

Let’s break down what is happening. The push for renewable energy is fine, but it comes at a price, and all too often society does not want to pay – let alone acknowledge – that price upfront. When the bill finally comes due, we all pretend to be shocked at how untenable the price has become. Learning nothing from these mistakes of willful ignorance, we plow ahead with more, continuing a do-loop of insanity that ends only once a crisis generates damage on a scale significant enough to force a confrontation with scientific and economic reality, thus introducing more realistic solutions.

If only we could skip directly to the inevitable.

It is widely known that adding intermittent electricity-generating sources to an electricity grid can substantially destabilize it. As it turns out, the reliable operation of a grid falls into the category of “tough problems that everybody takes for granted.” Electricity sources must be perfectly timed with anticipated demand, which is why utilities have a mix of always-on base load power (think coal, nuclear, and natural gas), mostly-on intermediate power (like renewables) and rarely-on peaking power (dedicated power plants – usually natural gas turbines – that only run when demand exceeds the combination of what the base load and intermediate facilities can produce).

Many of our policy makers govern from platitude to platitude. Most have no formal scientific training, nor have they spent any meaningful time working in heavy industry. It sounds good to be pro-renewable and simultaneously against nuclear energy. It sounds good to be against any new exploration and development of traditional fossil fuels in our own backyards. It sounds good to oppose the construction of new power plants using traditional fuels, no matter how critical they might be to the operation of the grid. It all sounds good, except taken in combination these positions make for predictably terrible policy that imperils the most economically vulnerable among us.

It’s all made worse by the ongoing financialization of our basic industries. Prioritizing short-term efficiency over long-term system robustness, we’ve allowed spreadsheet-dwelling analysts at investment banks and management consulting firms to dictate critical industry strategy. For example, instead of integrated chemical companies that have the capacity to absorb input cost volatility because they can capture 5-10 steps of value down the chain, we’ve sliced and diced unit operations into individual pure plays to placate speculators. The sum of the parts always looks better than the whole on paper or in Excel, except that’s mostly a mirage.

Worse, when a company prudently hedges its input costs or product prices, gains are dismissed as transitory and losses are interpreted as mismanagement. The message from speculators is clear – let us trade you as a pure play, we’ll hedge our own exposures.

It is through this combination of forces that the UK ends up with unhedged, pure-play fertilizer plants shutting down because the wind stopped blowing and they’ve outsourced critical natural gas supplies to Vladimir Putin, threatening the entire food supply chain of an allegedly first-world country.

A modern fertilizer plant is an optimized version of the Haber-Bosch process, which was invented more than 100 years ago. Although few have probably even heard of the Haber-Bosch process, it is a staggeringly important invention that enables humanity to thrive. The plant inputs are natural gas (i.e., methane), water, and air (i.e., nitrogen and oxygen). Out the back-end comes ammonia and purified carbon dioxide. Here’s a simplified schematic, courtesy of Wikipedia:

For a variety of utterly predictable reasons, Europe finds itself in a natural gas supply crisis. Utilities are scrambling to make up for an unexpected shortfall from their wind energy assets and are hammering bids into a no-offer natural gas market. Prices have reached $25 per million BTUs in the UK, nearly five times the current price here in the US, which is itself now double the recent averages. Fertilizer plants got caught in the cross-hairs and can’t afford to keep operating with these input costs. So, they stopped operating.

This isn’t a crisis of fertilizer – there’s plenty of that to be had globally – it’s a crisis of carbon dioxide. To most people, carbon dioxide is known as CO2 and considered nothing more than the product of burning fossil fuels (i.e., a global warming gas). To the food industry, purified CO2 is a critical input across several important dimensions. Without CO2, both the meat and the frozen food supply chains would collapse. In the UK, they were weeks away from doing so – until the government finally stepped in overnight.

We won’t dwell on the horror of how CO2 is used to stun chickens and pigs before slaughter – I recognize how this is a uniquely personal issue. Instead, I’ll focus on the critical role CO2 plays in the cold chain, which is how temperature-sensitive goods are moved around in our economy.

Solid CO2 is colloquially known as dry ice. It has two outstanding properties which make it ideal for the cold chain: it freezes at a much lower temperature than water and it sublimes directly to a gas as it inevitably warms up. That means longer shipping times are possible and there’s no liquid mess to clean up when the package arrives (hence the use of the adjective “dry” before “ice”).

So…without fertilizer plants operating, there’s no purified CO2 byproduct. Without purified CO2 byproduct, there’s no dry ice. Without dry ice, there’s no frozen foods being shipped. Without frozen foods, society quickly dissolves into a hunger crisis. Politicians don’t like hunger crises, and for good reason. There’s usually a short path from “empty shelves” to “guillotine.”

Last night, the UK government did what it had to do. It bailed out their main fertilizer producer – CF Industries Holdings Inc. Pitched as a limited three-week deal for which details were not disclosed, the move likely averts a full-blown crisis for now.

Until we address the underlying insanity of the policies and perverse market forces that got us here, you can expect more seemingly random and ultimately expensive emergencies like these. The bill for this particular blunder came due and the UK decided to pay it. It won’t be the last.

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As electric vehicles (EVs) become the new standard, charging infrastructure will become a commonplace detail blending into the landscape, available in a host of places from a range of providers: privately run charging stations, the office parking lot, home garages and government-provided locations to fill in the gaps. We need a new energy blueprint for the United States in order to maintain a stable grid to support this national move to EV charging.

The Biden administration announced 500,000 charging stations to be installed nationally and additional energy storage to facilitate the shift to EVs. Integrating all of this new infrastructure and transitioning requires balancing the traffic on the grid and managing increased energy demand that stretches beyond power lines and storage itself.

The majority of EV infrastructure pulls its power from the grid, which will add significant demand when it reaches scale. In an ideal situation, EV charging stations will have their own renewable power generation co-located with storage, but new programs and solutions are needed in order to make it available everywhere. A range of scenarios for how renewables can be used to power EV charging have been piloted in the U.S. in recent years. Eventually, EVs will likely even provide power to the grid.

These technological advances will happen as we progress through the energy transition; regardless, EV infrastructure will heavily rely on the U.S. grid. That makes coordination across a range of stakeholders and behavior change among the general public essential for keeping the grid stable while meeting energy demand.

The White House’s fact sheet for EV charging infrastructure points to a technical blueprint that the Department of Energy and the Electric Power Research Institute will be working on together. It is critical that utilities, energy management and storage stakeholders, and the general public be included in planning — here’s why.

Stakeholder collaboration

Charging infrastructure is currently fragmented in the U.S. Much of it is privatized and there are complaints that unless you drive a Tesla, it is hard to find charging while on the road. Some EV owners have even returned to driving gas-powered vehicles. There’s reason to be hopeful that this will rapidly change.

ChargePoint and EVgo are two companies that will likely become household names as their EV networks expand. A coalition made up of some of the largest U.S. utilities — including American Electric Power, Dominion Energy, Duke Energy, Entergy, Southern Company and the Tennessee Valley Authority — called the Electric Highway Coalition, announced plans for a regional network of charging stations spanning their utility territories.

Networks that swap out private gas stations for EV charging is one piece of the puzzle. We also need to ensure that everyone has affordable access and that charging times are staggered — this is one of the core concerns on every stakeholder’s mind. Having charging available in a range of places spreads out demand, helping keep power available and the grid balanced.

Varying consumer needs including location and housing, work schedules and economic situations require considerations and new solutions that make EVs and charging accessible to everyone. What works in the suburbs won’t suit rural or urban areas, and just imagine someone who works the night shift in a dense urban area.

Biden’s plan includes, “$4 million to encourage strong partnerships and new programs to increase workplace charging regionally or nationally, which will help increase the feasibility of [plug-in electric vehicle] ownership for consumers in underserved communities.” Partnerships and creative solutions will equally be needed.

An opportunity to fully engage technologies we already have

“Fifty percent of the reductions we have to make to get to net-zero by 2050 or 2045 are going to come from technologies that we don’t yet have,” John Kerry said recently, causing a stir. He later clarified that we also have technologies now that we need to put to work, which received less air time. In reality, we are just getting started in utilizing existing renewable and energy transition technologies; we have yet to realize their full potential.

Currently, utility-scale and distributed energy storage are used for their most simplistic capabilities, that is, jumping in when energy demand reaches its peak and helping keep the grid stable through services referred to as balancing and frequency regulation. But as renewable energy penetration increases and loads such as EVs are electrified, peak demand will be exacerbated.

The role that storage plays for EV charging stations seems well understood. On-site storage is used daily to provide power for charging cars at any given time. Utility-scale storage has the same capabilities and can be used to store and then supply renewable power to the grid in large quantities every day to help balance the demand of EVs.

A stable power system for EVs combines utilities and utility-scale storage with a network of subsystems where energy storage is co-located with EV charging. All of the systems are coordinated and synchronized to gather and dispatch energy at different times of the day based on all the factors that affect grid stability and the availability of renewable power. That synchronization is handled by intelligent energy management software that relies on sophisticated algorithms to forecast and respond to changes within fractions of a second.

This model also makes it possible to manage the cost of electricity and EV demand on the grid. Those subsystems could be municipal-owned locations in lower-income areas. Such a subsystem would collect power in its storage asset and set the price locally on its own terms. These systems could incentivize residents to power up there at certain times of the day in order to make charging more affordable by providing an alternative to the real-time cost of electricity during peak demand when using a home outlet, for example.

Behavior change

The greatest challenge for utilities will be how to manage EV loads and motivate people to stagger charging their vehicles, rather than everyone waiting until they are home in the evening during off-peak renewable generation periods. If everyone plugged in at the same time, we’d end up cooking dinner in the dark.

While there’s been talk of incentivizing the public to charge at different times and spread out demand, motivators vary among demographics. With the ability to charge at home and skip a trip to the “gas station” — or “power station,” as it may be referred to in the future — many people will choose convenience over cost.

The way we currently operate, individual energy usage seems like an independent, isolated event to consumers and households. EVs will require everyone — from utilities and private charging stations to consumers — to be more aware of demand on the grid and act more as communities sharing energy.

Thus, a diverse charging network alone won’t solve the issue of overtaxing the grid. A combination of a new blueprint for managing energy on the grid plus behavior change is needed.

The FBI's attempt to confiscate tens of millions of dollars from Beverly Hills safe deposit boxes draws resistance and charges of government misconduct.

Here’s Bloomberg:

Bats dwelling in limestone caves in northern Laos were found to carry coronaviruses that share a key feature with SARS-CoV-2, moving scientists closer to pinpointing the cause of Covid-19.

Researchers at France’s Pasteur Institute and the University of Laos looked for viruses similar to the one that causes Covid among hundreds of horseshoe bats. They found three with closely matched receptor binding domains — the part of the coronavirus’s spike protein used to bind to human ACE-2, the enzyme it targets to cause an infection.

The finding, reported in a paper released Friday that’s under consideration for publication by a Nature journal, shows that viruses closely related to SARS-CoV-2 exist in nature, including in several Rhinolophus, or horseshoe bat, species. The research supports the hypothesis that the pandemic began from a spillover of a bat-borne virus. . . .

The three viruses found in Laos, dubbed BANAL-52, BANAL-103, and BANAL-236, are “the closest ancestors of SARS-CoV-2 known to date,” said Marc Eloit, head of pathogen discovery at the Pasteur Institute in Paris, and co-authors. “These viruses may have contributed to SARS-CoV-2’s origin and may intrinsically pose a future risk of direct transmission to humans.” 

Note that this newly discovered virus is still significantly different from SARS-CoV-2. But the finding is still important, as the receptor binding domains (RBDs) are pretty similar, and some lab leak proponents had argued that the SARS-CoV-2 RBD was suspicious and likely a product of “gain of function” research.