MarketEYE Magazine: Issue 2 - Energizing the Roaring 2020s

MarketEYE

Special Edition

Number 2

Energizing the Roaring 2020s

Michael Knight of TTI Looks Ahead

World energy consumption will grow 50% between 2018 and 2050, and electricity consumption with double.

Source: U.S. Energy Information Administration

Michael Knight

President, TTI Semiconductor Group Senior VP TTI, Inc.

The Evolution of Electricity At the heart of all electronics is electricity, the ultimate general-purpose technology. It is primal and entirely natural, in that its source is atoms.

Simply put, electricity is the flow of electrical power created by the movement of electrons being knocked out of their orbits within the nucleus of an atom. The resulting current electricity is known as a secondary energy source because it is generated from the conversion of a primary source of energy, such as coal, natural gas, oil, nuclear reactions or solar radiation.

Mankind first became aware of the phenomena of electricity in its static form, the most evident example of which is lightning. The ancient Greeks were the first to generate man-made lightning when Thales of Miletus, the father of geometry, observed that he could create an electric charge and spark by rubbing a piece of amber with wool. In fact, the origin of the word electric is the Greek word for amber, ĂŠlektron.

The start of modern experimentation with electricity is often attributed to Benjamin Franklin and his experiments, the most famous of which involved a kite, a key and a Leyden jar.

Scottish scientist Michael Faraday laid the groundwork for electricity generation at scale with his work on the principles of electromagnetic radiation in the early 1800’s. The first example of the commercialization of electricity occurred in 1870, kicking off the second Industrial Revolution and setting the stage for inventors like Edison, Tesla and Westinghouse to figure out how to transmit electricity and put it to work.

Today, the majority of electricity production is still based on the rotation of a magnet within a coil of wire – exactly how the early electric pioneers generated current for their experiments. The modern electric generator is powered by a turbine, by which the potential energy contained in a fuel source is converted into the kinetic energy that spins the electromagnets in the generator. Turbines use some form of primary energy (like flowing water, wind or water vapor) to spin them.

The water vapor method dominates, and it is here that various forms of fuel come into play to transform water into steam.

Electricity generation is commonly categorized by its fuel source, and those are often categorized as either renewable or nonrenewable. Increasingly, fuel sources are categorized by their impact on the environment. To that, I would add another way of looking at energy; finite and costly to obtain and maintain, or infinite and virtually free once the related infrastructure is in place. Of the various ways that the technologies associated with each fuel source can be examined, those that are good for the environment and/or infinite and free are truly transformative for humankind and the planet. As such, they will be major drivers of the electronics industry in this decade and beyond.

Fusion-Fueled Power The fastest-growing alternative source of electricity (i.e. not related to fossil fuels) is solar power. Like all stars, the sun is made up mostly of hydrogen and helium atoms in a plasma state. The sun is essentially a massive nuclear fusion reactor, the output of which is light and heat. The high pressure and temperature in the sun’s core causes the atomic nuclei to separate from their electrons. The resulting hydrogen nuclei then fuse to form one helium atom, which releases radiant energy. It can take 150,000 years for energy in the sun’s core to make its way to the solar surface, and then just over eight minutes to travel the 93 million miles to Earth.

This fusion process makes the sun a virtually limitless energy source. Photovoltaics are a nearly perfect way of converting that energy into electricity. What brings it up short of perfection is the times each day when the sun doesn’t shine due to nighttime and weather. The inhabited parts of the world have anywhere from 1,600 to 3,600 hours of sunlight per year, out of a grand total of 8,760 hours in the year. This works out to the sun being in the sky between 18 percent and 41 percent of the day, with the exact figure mostly having to do with proximity to the equator.

But the key piece of information is that the sun generates

enough solar energy each second to power the earth for 500,000 years. Of that, the amount of that energy that reaches the Earth each hour is enough to power the planet for a year. In practical terms, this is what makes the sun an infinite energy source. And once photovoltaic solar panels have been paid for, the energy they generate is close to zero cost. As an added benefit, the photovoltaic generation of electricity does not harm the environment.

When looked at from a global perspective, the sun is always shining somewhere – 24 hours a day, 365 days a year – so, theoretically, solar power could perfectly power the world, even though the very best panels today only convert sunlight to electricity at 40 percent efficiency. But this dream breaks down against the reality of today’s technology for distributing that electricity, commonly referred to as the power grid.

The State of the Grid The U.S. electric grid dates back to 1882, the year that Thomas Edison unveiled the country’s first power plant at the Pearl Street Station in lower Manhattan. Believe it or not, the grid today looks and operates largely as it did back in 1935 when it began to rapidly expand across the country.

Unsurprisingly, the infrastructure is quite old.

According to the U.S. Department of Energy, 70 percent of power transformers are over 35 years old; 60 percent of the circuit breakers are over 35 years old; 70 percent of the transmission lines are over 30 years old; and the average age of power generation sites is 30+ years. All told, there are roughly 5,800 power plants on the grid, sending electricity across 2.7 million miles of wire – and operated by 3,200 different utilities.

The operations and maintenance expense for it all is rapidly approaching $15 billion per year.

Another feature of the grid is that it transmits alternating current. Most electricity, including power from photovoltaic

sources, is generated in the form of direct current which then has to be converted to alternating current and the voltage stepped up in order to transmit the power over long distances. The energy transmitted “fills� the transmission lines and then pushes out through distribution lines, where it is stepped down and pushed into the cords that connect and power the majority of non-battery-operated devices.

While the high voltage is necessary to overcome the resistance inherent in cabling, the fact is that a lot of the energy from the primary source is lost as heat. In fact, the current grid is estimated to be only 40 percent efficient, meaning that 40 percent of the actual energy generated at the source reaches a point of use. Add to this the fact that most power plants are at best 35 percent efficient in their conversion of fuel into electricity, and the enormous benefits that would come from modernizing the entire grid become obvious.

A study done at the University of Texas estimated that it would take $5 trillion to update the United States electric grid to make it both smarter and more efficient. The study concluded that such a project would pay for itself in 10 years, and the benefits in terms of energy conservation, reduction in greenhouse gas emissions and increased grid security would more than justify the investment. This is a project that the U.S. Federal government has been talking about as far back as a Federal Power Commission study that was done in 1967.

If there is any good news at all in this lack of progress, it is that technological innovation has not stood still. The new national grid we could build today would be infinitely better and more scalable than anything that we might have built even as recently as ten years ago. For example, a new transmission line called the Grain Belt Express was recently approved. It is an 800-mile-long, 4,000-megawatt high voltage direct current system intended to move electricity from wind-rich Kansas to markets in the east. The cost is estimated to be $2.3 billion. China is well ahead of us in this area, already having built a DC line that is thousands of miles long to move electricity from wind generation sites in the north to big cities in the south.

A couple of years ago at a conference, I sat next to the Chief Technology Officer of a big utility company in the west. I asked him why the U.S. wasn’t keeping pace with, let alone leading, the Chinese in modernizing our electric grid with DC transmission lines.

His response was that government regulation was preventing it. At the Federal level, regulation has created a fragmented utility and grid structure that makes large-scale investment impractical. At a local level, acquiring the needed land on which to build these new lines is almost impossible. His view at the time was that we would never see anything like the Grain Belt Express. Never say never!

Grid-Level Challenges

Power grids are also extremely regionalized. While there is some connectivity across immediate country borders – for example, between Canada and the U.S. – electric distribution systems are mainly local affairs. There is no mechanism for moving solar power from a sunny spot on one part of the globe to a dark spot on another. All the solar power we generate must be used close to its origin point, or it goes to waste.

Today, we don’t have the widespread, grid-level storage necessary to save excess solar energy.

However, downstream from the grid, community-scale solar is progressing. These are local solar farms intended to energize neighborhoods and other contained, populationdense areas, like airports. Most states have at least one such project online, but the real impact so far is minimal; the aggregate power generation from those projects today is only sufficient to power about 300,000 homes.

In total, U.S. solar output now makes up only 1.8 percent of grid energy sources, according to the U.S. Energy Information Administration. GTM Research forecasts this to double by 2021, and it could grow to 30 times this amount by the end of the decade. Calculations based on current panel efficiency show that it would take an area about the size of the state of Delaware to field enough solar panels to power the entire country. That works out to about 0.07 percent of the U.S. landmass – which, in turn, is about half of what the fossil fuel industry already occupies. But an even more practical approach is the installation of solar panels on the roofs of existing structures, which would deliver an estimated 40 percent of the space required.

As of now, there are more than 1.5 million solar panels in operation in the United States, and they are offsetting more than 70 million metric tons of carbon dioxide every year. This level of offset is like planting 1.2 billion trees.

The largest solar farm in operation in the U.S. is four times the size of New York City’s Central Park, and there are similar utility-scale farms under construction that will quadruple photovoltaic electricity production when complete.

A practical example of solar enabling another significant trend in electrification is its use to power electric vehicle charging stations. Backed by Volkswagen, Electrify America is installing 30 solar-powered charging stations as part of a pilot program in rural California. These stations will not be connected to the grid, so drivers will charge using 100 percent renewable energy. The stations will each have a 4.28-kilowatt sun-tracking solar array canopy, a 32-kilowatt-hour energystorage battery pack and two Level 2 charging plugs. The stations will allow two cars to charge simultaneously, regardless of weather or time of day. This is a very important development, as a recent EV study conducted in Texas found that if 60,000 electric vehicles were to simultaneously plug into the state’s electric grid, it would crash. That is just a fraction of the 22 million vehicles registered in the state.

From an electronic component industry standpoint, these developments are good news as solar infrastructure is dense with electronic components. From a broader economic point of view, the solar industry already employees over a quarter of a million workers – more than the coal, oil and natural gas industries combined.

Behind this surge is the fact that new solar plants are now less expensive to build and run than coal-fired plants. This has actually already led to the decommissioning of coal plants and their replacement by new solar farms.

The photovoltaic panel infrastructure is growing rapidly, which will further reduce costs. As in most things related to green energy, China is leading the way. GCL System Integration Technology is getting ready to build the world’s biggest solarpanel manufacturing plant, with capacity to meet half of global demand. The Chinese manufacturer plans to invest 18 billion yuan ($2.54 billion) to construct a facility in eastern Hefei province that will be able to produce enough solar panels each year to generate 60 gigawatts of solar energy. The plant’s maximum output is double the 30 gigawatts of capacity installed in all of China in 2019, and would be able to supply to almost 51 percent of solar installations worldwide. This will put them ahead of current leader, JinkoSolar Holding Co., which has 16 gigawatts of capacity.

When it comes to solar power generation (and to wind power as well), the real, and

maybe only, limiting factor to even faster growth is that grid-level energy storage is extremely limited and inefficient. The most common way to store excess energy on the grid is via pumped hydropower, which involves using a portion the electricity generated to pump water up into a reservoir where it can later be released to spin a turbine. This is a very impractical and inefficient way to store the excess energy generated by solar power during daylight hours in order to have power through the night.

The most promising current solution to this dilemma is batteries. Companies like Tesla are already marketing battery walls for home solar installations which will keep entire households powered through the night, or during bad weather. And communitysized solar farms are adopting the same battery technology. But this innovation has yet to scale to grid-level storage. When it does, both solar and wind-generated electricity will ramp up to dominate our energy infrastructure landscape.

Aside from solar, the other main “green” sources of energy for electricity generation are hydropower, geothermal power, nuclear power and wind power. From the standpoints of abundance and renewability, hydropower is questionable: as climate change takes hold, weather patterns will alter and rain-fed water sources will dry up. Geothermal-based electricity generation is very minor in the U.S. due to the limited number of places it can be economically installed with today’s technology.

Though we are the global geothermal leader in terms of amount of power produced, it is not really a grid-level power source and most of the implementations are scaled to single buildings.

Eco-Friendly Energy Sources

However, nuclear and wind power have promise. Today’s nuclear energy generation is based on a fission process that uses uranium as its fuel. It is not renewable – once the energy is harvested from the fissile material, it is permanently depleted – nor is it abundant, as at current rates of consumption the world’s uranium deposits could be consumed within 100 years.

Nuclear fission is also not perfectly “green,” as fossil fuels are utilized throughout the uranium supply chain, from mining to the enrichment process. And, of course, concerns about accidents and what to do with waste have kept nuclear power plants from proliferating, holding the contribution of nuclear to the U.S. electricity supply to 20 percent. As of 2020, there are 57 active power plants with a combined 95 nuclear reactors at work across 29 states.

The average age of electricity-generating reactors is 38 years old, and their numbers are shrinking. The last new reactor came online in 2016 after a 10-year period of no new construction, and 17 reactors were shut down in 2019.

But that is about to change. The Nuclear Regulatory Commission has just approved a Small Modular Reactor (SMR) designed and built by NuScale, a company based in Portland, Oregon. SMRs are much smaller and safer than traditional nuclear fission-

based power generators and they can be networked to create grid-level electricity sources. A cluster sized to occupy a 30-acre plot of land would produce the same amount of power as a solar farm covering 11 square miles.

NuScale is not alone. A Bill Gates-backed company named TerraPower is hard at work bringing their own SMRs to market. In the near term, the technology is likely to be a major difference-maker in any plan to decarbonize our electricity market.

Nuclear Fusion: A Dream Coming Closer to Reality There is another “nuclear option.” Nuclear fusion (the process at work inside the sun) would be a source of unlimited electricity that would address much of the fissionrelated concerns about safety, and completely eliminate nuclear waste. The concept has been in the works for more than 60 years and was actually proven out for the first time in the 1990’s.

Since then, a number of organizations and companies have been working on commercializing a nuclear fusion power plant. High-profile investors including Bill Gates (who is also investing in next-generation fission power), Jeff Bezos and Peter Theil are behind a number of these ventures. Breakthroughs suggest that the technology could very well be online before the end of this decade.

Nuclear fusion is inherently safe, as there will only be a small amount of fuel inside the reactor at any given moment and the fuel itself is hydrogen – the same fuel found in the sun. The trick is that the amount of energy it takes to initiate a fusion process is significant, even for light elements like hydrogen, and the containment of the resulting superheated plasma is complicated.

One Gates-backed venture is doing this with superconducting magnets. (Superconducting technology is another of the 20 technologies driving the 2020’s, which will be covered in a later installment of this series.)

Once commercialized, a possible fusion reactor deployment scenario involves lots of small nuclear-fusion reactors deployed in neighborhoods, cities, farms, Martian colonies and anywhere else that people will congregate and need electricity. In this scenario, long-distance transmission lines would no longer be needed. These self-contained mini-reactors would run for years on hydrogen, perhaps extracted from seawater, directly powering everything in their proximity. Once the initial cost to build and install them is covered, the electricity that they generate is virtually free.

Wind Energy: “Indirect� Solar Power Like solar and nuclear fusion, the marginal cost of electricity generated from a turbine spun by the wind is low to the point of potentially being virtually free. Wind energy is an indirect form of solar energy created by a combination of factors, including the uneven heating of the atmosphere by solar radiation, variations in topography and the Earth’s rotation. People have been putting wind energy to use throughout history to propel sailboats, mill flour from grain and pump water.

Today, the wind-driven mechanical power of huge multi-blade rotors generate an estimated 8 percent of all the electricity consumed in the United States. There are over 60,000 wind turbines installed across 41 states at a total investment of over $200 billion. These turbines generate enough electricity today to power more than 30 million American homes.

I recently drove through the Texas panhandle and saw mile after mile of wind turbines turning lazily in the perpetual breeze. The main north-south artery, Highway 287, was crowded with tractor trailers hauling new blades and stanchions to expand these wind farms. Both wind and solar power generation are wellsuited for arid areas of the country. This is ideal in that these areas tend to be sparsely populated and, as a result, land costs tend to be relatively low.

But the lack of people means a lack of local consumers for the electricity that is generated, so these projects require investment in transmission lines to connect them to grids that can get the power to more temperate parts of the country where the population tends to concentrate.

To close out on wind power, it is both good for the environment (local bird populations excepted) and for the economy. In the U.S., wind power infrastructure has created 120,000 jobs, reduced CO2 emissions by 198 million metric tons and saved over 100 billion gallons of water. As significant as these numbers are, however, they pale in comparison to those of China which leads the world in installed wind capacity.

The move to electricity that’s entirely generated from green and renewable sources of energy is both entirely possible and entirely necessary. Several countries have already achieved at least the green part of this aspiration. Albania and Paraguay are 100-percent hydro-powered, and Iceland is powered by a combination of hydro and geothermal. On more days than not, all of Australia’s electricity comes from solar, and there are days in California and Texas that 100 percent of those states’ electricity needs are covered by solar and wind, respectively.

Clean and Abundant Energy Saves the World Renewable power in the U.S. already accounts for 17 percent of the total electricity generated. A number of universities and government agencies have mapped out ways that the U.S. can convert to 100-percent renewable sources by 2050. This transformation is very doable, and the economic, societal and environmental benefits of doing so are extremely compelling.

The Solutions Project of Stanford University found that 139 countries currently emit 99 percent of all greenhouse gases. The study noted that in eliminating oil, gas and uranium as fuel sources, the energy associated with mining, transporting and refining these fuels is also eliminated, reducing existing international energy demands by 13 percent. Further, a move to 100-percent renewable-energy-based electricity saves an estimated $20

China is investing in power infrastructure to move solar and wind electricity to urban users

trillion in health care and climaterelated expenses. Such a move would come at the expense of roughly 28 million jobs in the nonrenewable energy space, but more than offsetting this shift would be the creation of 52 million new jobs in the clean and green energy sector.

China is leading the world in the switch to renewable energy, particularly in the production, utilization, export and installation of solar panels, wind turbines, batteries and electric vehicles. China’s government plans to produce 50 percent of its power requirements from non-fossil-fuel sources by 2030. This is ambitious but highly

necessary, as pollution from coal-fired power plants contributes to as many as 20 percent of China’s premature deaths.

One element of this plan was the construction of a 1.1-million-volt, highcapacity, high-efficiency transmission line to move wind-generated power across thousands of miles from the north (where it is very windy) to the southeast (where much of the population is). This project alone will provide green energy for 26 million people.

Energy Access Impacts Quality of Life The impact of clean and abundant energy on the human condition is hard to overestimate, particularly for the 1.4 billion people around the world that have no access to electricity at all. Even more disturbing is that fully 2.5 billion people do not have access to proper sanitation, in many cases due to a lack of ready access to clean water. Cheap, readily available, abundant electricity would drive the pumps needed to bring clean water to these communities, and would help solve the developing global water shortage issues through the desalination of sea water, which is a very energy intensive process.

Simply having access to electricity can significantly improve and extend the lives of almost a quarter of the people on the planet.

Even in first-world countries, near-zero-cost energy would free up money that could fund healthcare systems, improve social care, fund improved education systems and accelerate research in fundamental fields of science.

It is virtually impossible to imagine all the ways in which clean, sustainable free energy could improve the human condition. We have most of the technology today, and any missing pieces should arrive this decade. What is needed now to transform this from fantasy to reality is large-scale, coordinated investment. The economic and societal benefits associated with this transformation will more than pay for, and justify, the effort and expense.

No discussion on electricity, past, present or future, would be complete without a look at batteries. They are both a source of electricity and a means of storing electric power. In simple terms, a battery produces electricity using two different metals in a chemical solution.

A reaction between these metals and the chemicals frees more electrons in one metal than in the other. One end of the battery is attached to one of the metals; the other end is attached to the other metal. The end that frees more electrons develops a positive charge and the other end develops a negative charge. If a wire is attached from one end of the battery to the other, electrons flow through the wire to balance the electrical charge. Basically, a battery is a small chemical reactor that generates electricity.

Batteries: Chemical Energy Cuts the Cord The first modern battery dates back to 1800, when Italian physicist Alessandro Volta developed the voltaic pile to store electricity; before that, our friend Benjamin Franklin had first used the term “battery� in 1749 when he was doing his famous experiments with electricity using a set of linked capacitors.

One of the first modern uses of batteries was to power electric cars, which were the precursors to cars with internal combustion engines. In fact, one of the most enduring batteries, the lead-acid battery, was invented in 1859 and is still the technology used to start most internal combustion engine cars today. The lead-acid battery is the oldest example of a rechargeable battery, but the battery technology that has played the biggest role to date in the advancement of the electronic age is the lithium ion battery.

In 1980, the American physicist Professor John Goodenough invented a new type of lithium battery in which the lithium (Li) could migrate through the battery from one electrode to the other as a Li+ ion.

Lithium is one of the lightest elements in the periodic table and has one of the largest electrochemical potentials – a combination that produces high voltage in low, compact volumes.

The way these batteries work is that lithium is combined with a transition metal – such as cobalt, nickel, manganese or iron – and oxygen to form the cathode. During recharging, when voltage is applied, the positively-charged lithium ion from the cathode migrates to the graphite anode and becomes lithium metal. Because lithium has an irresistible electrochemical potential to be oxidized, it migrates back to the cathode to become a Li+ ion again, giving its electron back to the cobalt ion. The movement of electrons in the circuit is what gives us electric current that we can use.

Mainstream lithium-based battery technology has peaked, but recent discoveries of new families of disruptive active materials are delivering nextgeneration lithium batteries. These compounds can store more lithium in both electrodes, and they also address the increasing scarcity of current-design raw materials. This will be especially important for energy storage systems (ESS) for renewables and all manner of electric vehicles where high energy, high power and safety are critical.

Professor Goodenough, at 98 years old, remains in the thick of things from his position at the University of Texas where he is developing new solid-state batteries. Solid-state batteries represent a technology breakthrough. As described above, in modern Li-ion batteries, ions move from one electrode to another across the liquid electrolyte in a process called ionic conductivity, whereas in solid-state batteries the liquid electrolyte is replaced by a solid compound which nevertheless allows lithium ions to migrate within it. Though not a new concept, new families of solid electrolytes have been discovered JAN

with very high ionic conductivity, and these electrolytes are beginning to enter the mainstream.

Among the advantages of solid-state

2.5x

Estimated energy density improvement of solid-state over current technologies

60+

The number of years researchers have been striving to achieve a viable solid-state battery

3,500,000

The number of electric vehicles sold since 2011

batteries is one marked improvement: solid electrolytes are non-flammable when heated, unlike their liquid counterparts. In addition, this technology enables the use of high-voltage, high-capacity materials

8.7 Billion

The number of smartphone batteries required to meet the current capacity of electric vehicle batteries

Infinite

The number of applications that would benefit from improved battery technology

in denser, lighter batteries. These new batteries have improved shelf life as a result of reduced self-discharge. And, as these batteries can exhibit a high power-to-weight ratio, they will be ideal for use in electric vehicles. The first such batteries to reach market are likely to use graphite-based anodes.

Another promising materials technology for nextgeneration batteries is graphene. Comprised of a sheet of carbon atoms bound together in a honeycomb lattice pattern, graphene has become known as a modern “wonder material” due to its long list of amazing attributes and applications. It is a potent conductor of electrical and thermal energy; is chemically inert and very lightweight; withstands temperature fluctuation well; and is very flexible with a large surface area. And, to make it even more attractive, graphene is eco-friendly and sustainable.

In the field of batteries, conventional battery electrode materials (and prospective ones) are significantly improved when combined with graphene. Graphene can improve battery attributes such as energy density and form in various ways. Li-ion batteries and other types of rechargeable batteries can be enhanced by introducing graphene into the cell’s anode, capitalizing on the material’s conductivity and large surface area to achieve morphological optimization and performance. In addition to revolutionizing the battery market, the combination of graphene batteries and graphene supercapacitors will deliver significant improvement in virtually all self-powered applications.

The impact of future battery technologies on the world of electronics, and on the

Batteries are the key to reaching a tipping point where electric vehicles gain advantage over vehicles that rely on fossil fuels. If it rolls, floats or flies, it will soon be powered by lightweight, high-energy, fast-charging, long-lived batteries. electronic components industry, will be substantial.

Batteries have already made many of the electronic devices common in our lives transportable, the most obvious of which is our mobile phones. Less obvious are all of the batteries embedded in smart watches and medical devices that serve as everything from pacemakers to artificial pancreases. Coming fast are trillions of sensors, many operating remotely, that will be battery powered and able to transmit data to the cloud for decades using new battery technologies.

This untethering from the electrical outlet will drive a wave of product replacements that will consume a massive number of electronic components … and generate an equally massive amount of e-waste for which we need an environmentallysound solution. It will also drive the next big wave of electronic devices into our surroundings and lives. In this way, batteries will play an outsized role in the enablement and acceleration of almost all of the 20 technologies driving the 2020’s.

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