Natural Gas Producers

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According to US Energy Information Administration (EIA)’ Annual Energy Outlook 2020, the cost of power produced by solar photovoltaic (PV) generating technologies entering the services in 2025 was estimated at $35.74 MWh before tax credit is applied; that of natural gas combined cycle was estimated at $38.07 per MWh.

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According to EIA’s Annual Energy Outlook 2020, the total overnight cost of solar PV generating technologies in 2021 is estimated at $1,331/kW, and that of advanced- and conventional natural gas combined cycles at $954/kW and $1,079/kW, accordingly. US National Renewable Energy Laboratory asserts that by 2025 the overnight cost of utility-scale sola PV will fall below $1,000/kW.

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These data indicate that by 2025 solar PV power will outpace natural gas combined cycle power both in terms of electricity cost and total overnight costs, i.e. the natural gas electricity will lose its financial edge over solar PV. Once the inflection point is overcame, the demand for natural gas will accelerate crumbling, prompting producers of natural gas bootsing their searching for the ways of extending life-cycle of natural gas for power production.

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Interestingly, whereas EIA’s Annual Energy Outlook 2018 provides forecast for levelized cost of electricity (LCOE) of natural gas advanced combined cycle with carbon capture and storage (CCS), the Outlook 2020 remains silent on this type of power generating technology. The reason is that due to around 50% higher LCOE of advanced natural gas combined cycle with CCS power plants entering the service in 2021 compared to these without CCS, EIA had likely assumed that it wouldn’t make sense building advanced NGCC with higher overnight costs and LCOE than  these of solar PV power plants.

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AG-Cycle is by far the best strategic solution to the industry’s demand-related looming problems, because AG-Cycle can reduce the cost of electricity of conventional NGCC power by around one third, and reduce  carbon dioxide emission per unit of energy produced by a factor of 2.5. This cost reduction will keep natural gas electricity cheaper than that of solar PV for at least a decade longer, thereby supporting natural gas demand. Reduced carbon dioxide emission will also make AG-NGCC electricity more environmentally friendly. What matters even more is that AG-Cycle will be able to lower LCOE from advanced NGCC power with CSS to that of solar PV.

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AG-conversion of coal-fired power plants will create a new expansive market for natural gas. In 2019, 38.4% and 23.5% of electricity in the US were generated from natural gas and coal, accordingly. If in 2019 all power plants using natural gas were AG-converted, as well as all coal plants, then the natural gas demand for power generations would have fallen by only 23.3%. In other words, reduction in natural gas consumption due to AG-conversion of natural gas combined cycle power plants would be partially mitigated by a newly created demand from coal-fired power plants converted to AG-natural gas-fired power plants.

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The unforeseen sharp reduction in costs of Li-ion batteries during the last couple years as well as the latest advancements in the field of graphene ultra-capacitors (aka graphene pseudo-batteries) with gravimetric energy approaching that of contemporary Li-ion batteries, have boosted proliferation of EVs beyond any of the most optimistic forecasts. The routine assumption that power shortage problems and high cost of materials for Li-ion batteries would naturally curb the expansion of EV market, does not seem to materialize. This means that demand for electricity will grow faster than expected. In this respect, AG-Cycle can benefit power generating utilities a lot. A rough estimate shows that comprehensive electrification of highway transportation in the US would require 25% increase in power production.

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Oil Producers

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With solar PV, wind power surging, and EVs robustly phasing out conventional IC engine automobiles, oil producers have a lot of worries about their future. The way the oil producers are slashing their investments, shows that the industry is preparing for dramatic oil demand reduction in the medium term. In our opinion, AG-Cycle is the only way for oil industry to uphold the oil demand for at least a decade by providing fuel to AG-EVs. AG-EVs will be a better choice for most consumers, because the vehicles will be completely anxiety-free; more fuel efficient and would have a lower carbon dioxide footprint than conventional EVs.

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Although AG-EVs will be around three times more fuel efficient than conventional IC engine vehicles, for the oil producers AG-EVs will be a lesser evil than conventional EVs, which consume none of gasoline. Estimates show that  reduction of gasoline demand from highway transportation will be fully recouped by a newly created oil demand from the emerging segment of AG-EVTOLS.

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The reduction of gasoline consumption by highway transportation due to AG-EVs will be additionally compensated by emerging gasoline demand from households whose residents possess AG-EVs. The cost of electricity produced by EV’s gas turbine range extender (TRE) enhanced with AG-Cycle (AG-TRE) will be slightly less than [2.6/(33.7*0.6)], i.e. 13c per kWh, if AG-TRE’s efficiency is 60%, and cost of gasoline, – $2.6 per gallon. Houses equipped with an ultra-capacitor power storage and using AG-EV will be able to produce their own affordable electricity. In other words, AG-Cycle will enable oil producers and refineries selling liquid fuels to households for electricity generation, not only for heating.

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From economic perspectives, this is the unsurpassed solution because the overnight specific cost of AG-TRE power will not exceed $100 per kW, whereas that of advanced natural gas combined cycle with CCS is around $2,000; that of dispatchable PV is about $1,900. Moreover, approximately 34 m EVs equipped with 35 kW AG-TRE will have the same, [35*31.4], i.e. 1.1 m MW, nameplate capacity as all power generating facilities in the US in 2019. To put it differently, the plurality of such AG-EVs will make up a sustainable distributed back-up power system.