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    Investors awaken to the risks of climate change

    Poppy Allonby, a senior financial executive and the former managing director of BlackRock, has been analyzing the link between climate change and investing for more than two decades. “For a lot of that, it was quite lonely,” Allonby said during her December address at the MIT Energy Initiative Fall Colloquium. “There weren’t that many other people looking at this field. And over the last three or four years, that’s completely changed.”

    Increasingly, Allonby said, investors are opening their eyes to the long-term risks of climate change — risks that threaten not only the planet, but also their portfolios. And as more institutional investors come to see climate change as a threat to their beneficiaries, they are taking action to fight it. Still, she cautioned that much more work remains to be done.

    “Various investors are at very different stages in considering climate change,” Allonby said. “Once they realize this is something they need to think about … they need to do a risk assessment, then develop a strategy.” 

    “When you look at different institutions,” she said, “some are just at the very beginning of this journey.”

    A changing landscape

    Although there is a compelling moral case to be made for taking steps to mitigate climate change, Allonby noted that institutional investors such as pension funds are bound by a fiduciary duty to their beneficiaries. That is to say, they are obligated to put their client or member interests ahead of their own.

    “I talk about fiduciary duty, because one of the things that has really changed in the investment space is that more and more investors are beginning to see climate change and climate risk as [impacting] their fiduciary duty,” said Allonby. “That has been a shift. In my mind, it makes total sense. If you’re a long-term investor … and you’re thinking about beneficiaries that need assets over the next 10 or 20 years, and thinking about risks that might materialize — and climate change, in particular — then that makes a lot of sense. But that is not where we were five or 10 years ago.”

    Allonby spent more than 20 years at the multinational investment management corporation BlackRock. For 17 of those years, she was a senior portfolio manager responsible for managing multibillion-dollar funds investing globally in companies across the traditional energy sector, and also those involved in sustainable energy and mitigating climate change. Most recently, she was head of the corporation’s Global Product Group on several continents, where she provided oversight for nearly $1 trillion assets and played a critical role in developing BlackRock’s sustainable product strategy.

    “Where I like to think the finance industry is heading is integration,” she said. “This means thinking holistically about pretty much every decision you make as an investor, and thinking about how climate risk is going to impact that investment. That is a sea change in the mentality around how people invest.”

    Divestment versus engagement

    For many years, activists have pushed for institutions — including MIT — to divest from fossil fuel companies. By keeping fossil fuel companies out of their portfolios, these activists argue, institutions and individuals can exert social, political, and economic pressure on these corporations and help to accelerate the shift to renewable energy.

    However, Allonby argued instead for ongoing engagement with fossil fuel companies, reasoning that this better positions investors to push for change. “My personal view with divesting from oil and gas companies is, that’s not very effective,” Allonby said. “I think there might be examples where you have very specific companies which you don’t think will be involved in the transition [to net zero], and [divestment] might make sense. Or if you’ve got an institutional investor where it is imperative that their investment is entirely aligned with their values — so, certain charities — it might make sense. But if you really care about change, I think you need to keep a seat at the table.”

    In a way, Allonby said, divesting from fossil fuel companies lets leaders at those organizations off the hook, reducing the pressure on them to make meaningful changes to their operations. “Imagine a company that is incredibly polluting and not sustainable, and they have shareholders that are not happy, but they don’t do anything, and those shareholders decide to divest,” she said. “What happens as a result of that, potentially, is the company goes, ‘Oh, that was easy! I didn’t have to do anything, and [the activists] have gone away.’ And potentially, those assets end up being owned by people who care less. So that is a risk, when you think about divestment.”

    Challenges and opportunities         

    Allonby outlined several challenges with climate-focused investing, but also noted a number of opportunities — both for investors looking to make money, and those looking to make a change.

    Among the challenges: For one, some investors simply still need to be convinced that climate change is a problem they should be working to solve. Also, Allonby said, there is a lack both of a formalized methodology and of specialized investment products for climate-focused investing, although she noted that both of these areas are improving. Finally, she said, it remains a challenge to encourage investors to direct capital toward clean-energy projects in developing countries. 

    Investors can both set themselves up for financial success and mitigate climate change, Allonby said, through savvy investments in either distressed or underpriced assets. “If you can buy assets that are discounted or cheaper because people have real concerns about their environmental footprint, then you can work with those companies to improve it and therefore reduce the risk and improve the valuation,” she said.

    Allonby, pointing to the high cost of waterfront property in areas that are vulnerable to rising sea levels, also suggested that the long-term risks of climate change have not been fully priced into many assets. “My view is that we haven’t really gotten our arms around that,” she said. “From a purely investment perspective, that’s also an opportunity.”

    Additionally, Allonby noted the recent rise of ESG funds, which invest with environmental, social, and corporate governance guidelines in mind. Some of these funds, she noted, have outperformed the larger market over the past several years.

    “When we talk about climate change, one has a range of emotions,” Allonby said. “Sometimes it can feel like we’re not making enough progress. And one of the nice things about being here at MIT is that whenever I’m here, I always feel hopeful about the future, and quite hopeful about all of the technologies and work that you are doing to transition energy systems and move things forward. When you look at what’s happening in the financial services sector, there’s still a huge amount to do, but it’s also quite a hopeful story.” More

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    Students dive into research with the MIT Climate and Sustainability Consortium

    Throughout the fall 2021 semester, the MIT Climate and Sustainability Consortium (MCSC) supported several research projects with a climate-and-sustainability topic related to the consortium, through the MIT Undergraduate Research Opportunities Program (UROP). These students, who represent a range of disciplines, had the opportunity to work with MCSC Impact Fellows on topics related directly to the ongoing work and collaborations with MCSC member companies and the broader MIT community, from carbon capture to value-chain resilience to biodegradables. Many of these students are continuing their work this spring semester.

    Hannah Spilman, who is studying chemical engineering, worked with postdoc Glen Junor, an MCSC Impact Fellow, to investigate carbon capture, utilization, and storage (CCUS), with the goal of facilitating CCUS on a gigaton scale, a much larger capacity than what currently exists. “Scientists agree CCUS will be an important tool in combating climate change, but the largest CCUS facility only captures CO2 on a megaton scale, and very few facilities are actually operating,” explains Spilman. 

    Throughout her UROP, she worked on analyzing the currently deployed technology in the CCUS field, using National Carbon Capture Center post-combustion project reports to synthesize the results and outline those technologies. Examining projects like the RTI-NAS experiment, which showcased innovation with carbon capture technology, was especially helpful. “We must first understand where we are, and as we continue to conduct analyses, we will be able to understand the field’s current state and path forward,” she concludes.

    Fellow chemical engineering students Claire Kim and Alfonso Restrepo are working with postdoc and MCSC Impact Fellow Xiangkun (Elvis) Cao, also on investigating CCUS technology. Kim’s focus is on life cycle assessment (LCA), while Restrepo’s focus is on techno-economic assessment (TEA). They have been working together to use the two tools to evaluate multiple CCUS technologies. While LCA and TEA are not new tools themselves, their application in CCUS has not been comprehensively defined and described. “CCUS can play an important role in the flexible, low-carbon energy systems,” says Kim, which was part of the motivation behind her project choice.

    Through TEA, Restrepo has been investigating how various startups and larger companies are incorporating CCUS technology in their processes. “In order to reduce CO2 emissions before it’s too late to act, there is a strong need for resources that effectively evaluate CCUS technology, to understand the effectiveness and viability of emerging technology for future implementation,” he explains. For their next steps, Kim and Restrepo will apply LCA and TEA to the analysis of a specific capture (for example, direct ocean capture) or conversion (for example, CO2-to-fuel conversion) process​ in CCUS.

    Cameron Dougal, a first-year student, and James Santoro, studying management, both worked with postdoc and MCSC Impact Fellow Paloma Gonzalez-Rojas on biodegradable materials. Dougal explored biodegradable packaging film in urban systems. “I have had a longstanding interest in sustainability, with a newer interest in urban planning and design, which motivated me to work on this project,” Dougal says. “Bio-based plastics are a promising step for the future.”

    Dougal spent time conducting internet and print research, as well as speaking with faculty on their relevant work. From these efforts, Dougal has identified important historical context for the current recycling landscape — as well as key case studies and cities around the world to explore further. In addition to conducting more research, Dougal plans to create a summary and statistic sheet.

    Santoro dove into the production angle, working on evaluating the economic viability of the startups that are creating biodegradable materials. “Non-renewable plastics (created with fossil fuels) continue to pollute and irreparably damage our environment,” he says. “As we look for innovative solutions, a key question to answer is how can we determine a more effective way to evaluate the economic viability and probability of success for new startups and technologies creating biodegradable plastics?” The project aims to develop an effective framework to begin to answer this.

    At this point, Santoro has been understanding the overall ecosystem, understanding how these biodegradable materials are developed, and analyzing the economics side of things. He plans to have conversations with company founders, investors, and experts, and identify major challenges for biodegradable technology startups in creating high performance products with attractive unit economics. There is also still a lot to research about new technologies and trends in the industry, the profitability of different products, as well as specific individual companies doing this type of work.

    Tess Buchanan, who is studying materials science and engineering, is working with Katharina Fransen and Sarah Av-Ron, MIT graduate students in the Department of Chemical Engineering, and principal investigator Professor Bradley Olsen, to also explore biodegradables by looking into their development from biomass “This is critical work, given the current plastics sustainability crisis, and the potential of bio-based polymers,” Buchanan says.

    The objective of the project is to explore new sustainable polymers through a biodegradation assay using clear zone growth analysis to yield degradation rates. For next steps, Buchanan is diving into synthesis expansion and using machine learning to understand the relationship between biodegradation and polymer chemistry.

    Kezia Hector, studying chemical engineering, and Tamsin Nottage, a first-year student, working with postdoc and MCSC Impact Fellow Sydney Sroka, explored advancing and establishing sustainable solutions for value chain resilience. Hector’s focus was understanding how wildfires can affect supply chains, specifically identifying sources of economic loss. She reviewed academic literature and news articles, and looked at the Amazon, California, Siberia, and Washington, finding that wildfires cause millions of dollars in damage every year and impact supply chains by cutting off or slowing down freight activity. She will continue to identify ways to make supply chains more resilient and sustainable.

    Nottage focused on the economic impact of typhoons, closely studying Typhoon Mangkhut, a powerful and catastrophic tropical cyclone that caused extensive damages of $593 million in Guam, the Philippines, and South China in September 2018. “As a Bahamian, I’ve witnessed the ferocity of hurricanes and challenges of rebuilding after them,” says Nottage. “I used this project to identify the tropical cyclones that caused the most extensive damage for further investigation.”She compiled the causes of damage and their costs to inform targets of supply chain resiliency reform (shipping, building materials, power supply, etc.). As a next step, Nottage will focus on modeling extreme events like Mangkunt to develop frameworks that companies can learn from and utilize to build more sustainable supply chains in the future.

    Ellie Vaserman, a first-year student working with postdoc and MCSC Impact Fellow Poushali Maji, also explored a topic related to value chains: unlocking circularity across the entire value chain through quality improvement, inclusive policy, and behavior to improve materials recovery. Specifically, her objectives have been to learn more about methods of chemolysis and the viability of their products, to compare methods of chemical recycling of polyethylene terephthalate (PET) using quantitative metrics, and to design qualitative visuals to make the steps in PET chemical recycling processes more understandable.

    To do so, she conducted a literature review to identify main methods of chemolysis that are utilized in the field (and collect data about these methods) and created graphics for some of the more common processes. Moving forward, she hopes to compare the processes using other metrics and research the energy intensity of the monomer purification processes.

    The work of these students, as well as many others, continued over MIT’s Independent Activities Period in January. More

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    Reducing methane emissions at landfills

    The second-largest driver of global warming is methane, a greenhouse gas 28 times more potent than carbon dioxide. Landfills are a major source of methane, which is created when organic material decomposes underground.

    Now a startup that began at MIT is aiming to significantly reduce methane emissions from landfills with a system that requires no extra land, roads, or electric lines to work. The company, Loci Controls, has developed a solar-powered system that optimizes the collection of methane from landfills so more of it can be converted into natural gas.

    At the center of Loci’s (pronounced “low-sigh”) system is a lunchbox-sized device that attaches to methane collection wells, which vacuum the methane up to the surface for processing. The optimal vacuum force changes with factors like atmospheric pressure and temperature. Loci’s system monitors those factors and adjusts the vacuum force at each well far more frequently than is possible with field technicians making manual adjustments.

    “We expect to reduce methane emissions more than any other company in the world over the next five years,” Loci Controls CEO Peter Quigley ’85 says. The company was founded by Melinda Hale Sims SM ’09, PhD ’12 and Andrew Campanella ’05, SM ’13.

    The reason for Quigley’s optimism is the high concentration of landfill methane emissions. Most landfill emissions in the U.S. come from about 1,000 large dumps. Increasing collection of methane at those sites could make a significant dent in the country’s overall emissions.

    In one landfill where Loci’s system was installed, for instance, the company says it increased methane sales at an annual rate of 180,000 metric tons of carbon dioxide equivalent. That’s about the same as removing 40,000 cars from the road for a year.

    Loci’s system is currently installed on wells in 15 different landfills. Quigley says only about 70 of the 1,000 big landfills in the U.S. sell gas profitably. Most of the others burn the gas. But Loci’s team believes increasing public and regulatory pressure will help expands its potential customer base.

    Uncovering a major problem

    The idea for Loci came from a revelation by Sims’ father, serial entrepreneur Michael Hale SM ’85, PhD ’89. The elder Hale was working in wastewater management when he was contacted by a landfill in New York that wanted help using its excess methane gas.

    “He realized if he could help that particular landfill with the problem, it would apply to almost any landfill,” Sims says.

    At the time, Sims was pursuing her PhD in mechanical engineering at MIT and minoring in entrepreneurship.

    Her father didn’t have time to work on the project, but Sims began exploring technology solutions to improve methane capture at landfills in her business classes. The work was unrelated to her PhD, but her advisor, David Hardt, the Ralph E. and Eloise F. Cross Professor in Manufacturing at MIT, was understanding. (Hardt had also served as PhD advisor for Sim’s father, who was, after all, the person to blame for Sim’s new side project.)

    Sims partnered with Andrew Campanella, then a master’s student focused on electrical engineering, and the two went through the delta v summer accelerator program hosted by the Martin Trust Center for MIT Entrepreneurship.

    Quigley was retired but serving on multiple visiting committees at MIT when he began mentoring Loci’s founders. He’d spent his career commercializing reinforced plastic through two companies, one in the high-performance sporting goods industry and the other in oil field services.

    “What captured my imagination was the emissions-reduction opportunity,” Quigley says.

    Methane is generated in landfills when organic waste decomposes. Some landfill operators capture the methane by drilling hundreds of collection wells. The vacuum pressure of those wells needs to be adjusted to maximize the amount of methane collected, but Quigley says technicians can only make those adjustments manually about once a month.

    Loci’s devices monitor gas composition, temperature, and environmental factors like barometric pressure to optimize vacuum power every hour. The data the controllers collect is aggregated in an analytics platform for technicians to monitor remotely. That data can also be used to pinpoint well failure events, such as flooding during rain, and otherwise improve operations to increase the amount of methane captured.

    “We can adjust the valves automatically, but we also have data that allows on-site operators to identify and remedy problems much more quickly,” Quigley explains.

    Furthering a high-impact mission

    Methane capture at landfills is becoming more urgent as improvements in detection technologies are revealing discrepancies between methane emission estimates and reality in the industry. A new airborne methane sensor deployed by NASA, for instance, found that California landfills have been leaking methane at rates as much as six times greater than estimates from the U.S. Environmental Protection Agency. The difference has major implications for the Earth’s atmosphere.

    A reckoning will have to occur to motivate more waste management companies to start collecting methane and to optimize methane capture. That could come in the form of new collection standards or an increased emphasis on methane collection from investors. (Funds controlled by billionaires Bill Gates and Larry Fink are major investors in waste management companies.)

    For now, Loci’s team, including co-founder and current senior advisor Sims, believes it’s on the road to making a meaningful impact under current market conditions.

    “When I was in grad school, the majority of the focus on emissions was on CO2,” Sims says. “I think methane is a really high-impact place to be focused, and I think it’s been underestimated how valuable it could be to apply technology to the industry.” More

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    Energizing communities in Africa

    Growing up in Lagos, Nigeria, Ayomikun Ayodeji enjoyed the noisy hustle and bustle of his neighborhood. The cacophony included everything from vendors hawking water sachets and mini sausages, to commuters shouting for the next bus.

    Another common sound was the cry of “Up NEPA!” — an acronym for the Nigerian Electrical Power Authority — which Ayodeji would chant in unison with other neighborhood children when power had been restored after an outage. He remembers these moments fondly because, despite the difficulties of the frequent outages, the call also meant that people finally did have long-awaited electricity in their homes.

    “I grew up without reliable electricity, so power is something I’ve always been interested in,” says Ayodeji, who is now a senior studying chemical engineering. He hopes to use the knowledge he has gained during his time at MIT to expand energy access in his home country and elsewhere in Africa.

    Before coming to MIT, Ayodeji spent two years in Italy at United World College, where he embarked on chemistry projects, specifically focusing on dye-sensitized solar cells. He then transferred to the Institute, seeking a more technical grounding. He hoped that the knowledge gained in and out of the classroom would equip him with the tools to help combat the energy crisis in Lagos.

    “The questions that remained in the back of my mind were: How can I give back to the community I came from? How can I use the resources around me to help others?”  he says.

    This community-oriented mindset led Ayodeji to team up with a group of friends and brainstorm ideas for how they could help communities close to them. They eventually partnered with the Northeast Children’s Trust (NECT), an organization that helps children affected by the extremist group Boko Haram. Ayodeji and his friends looked at how to expand NECT’s educational program, and decided to build an offline, portable classroom server with a repository of books, animations, and activities for students at the primary and secondary education levels. The project was sponsored by Davis Projects for Peace and MIT’s PKG Center.

    Because of travel restrictions, Ayodeji was the only member of his team able to fly to Nigeria in the summer of 2019 to facilitate installing the servers. He says he wished his team could have been there, but he appreciated the opportunity to speak with the children directly, inspired by their excitement to learn and grow. The experience reaffirmed Ayodeji’s desire to pursue social impact projects, especially in Nigeria.

    “We knew we hadn’t just taken a step in providing the kids with a well-rounded education, but we also supported the center, NECT, in raising the next generation of future leaders that would guide that region to a sustainable, peaceful future,” he says.

    Ayodeji has also sought out energy-related opportunities on campus, pursuing an undergraduate research program (UROP) in the Buonassisi Lab in his sophomore year. He was tasked with testing perovskite solar cells, which have the potential to reach high efficiencies at low production costs. He characterized the cells using X-ray diffraction, studying their stability and degradation pathways. While Ayodeji enjoyed his first experience doing hands-on energy research, he found he was more curious about how energy technologies were implemented to reach various communities. “I wanted to see how things were being done in the industry,” he says.

    In the summer after his sophomore year, Ayodeji interned with Pioneer Natural Resources, an independent oil and gas company in Texas. Ayodeji worked as part of the completions projects team to assess the impact of design changes on cluster efficiency, that is, how evenly fluid is distributed along the wellbore. By using fiberoptic and photographic data to analyze perforation erosion, he discovered ways to lower costs while maintaining environmental stability during completions. The experience taught Ayodeji about the corporate side of the energy industry and enabled him to observe how approaches to alternative energy sources differ across countries, especially in the U.S. and Nigeria.

    “Some developing economies don’t have the capacity to pour resources into expanding renewable energy infrastructure at the rate that most developed economies do. While it is important to think sustainably for the long run, it is also important for us to understand that a clean energy transition is not something that can be done overnight,” he says.

    Ayodeji also employs his community-oriented mindset on campus. He is currently the vice president of the African Students’ Association (ASA), where he formerly chaired the African Learning Circle, a weekly discussion panel spotlighting key development and innovation events taking place on the African continent. He is also involved with student outreach, both within the ASA and as an international orientation student coordinator for the International Students Office.

    As a member of Cru, a Christian community on campus, Ayodeji helps lead a bible study and says the group supports him as he navigates college life. “It is a wonderful community of people I explore faith with and truly lean on when things get tough,” he says.

    After graduating, Ayodeji plans to start work at Boston Consulting Group, where he interned last summer. He expects he’ll have opportunities to engage with private equity issues and tackle energy-related cases while learning more about where the industry is headed.

    His long-term goal is to help expand renewable energy access and production across the African continent.

    “A key element of what the world needs to develop and grow is access to reliable energy. I hope to keep expanding my problem-solving toolkit so that, one day, it can be useful in electrifying communities back home,” he says. More

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    Preparing global online learners for the clean energy transition

    After a career devoted to making the electric power system more efficient and resilient, Marija Ilic came to MIT in 2018 eager not just to extend her research in new directions, but to prepare a new generation for the challenges of the clean-energy transition.

    To that end, Ilic, a senior research scientist in MIT’s Laboratory for Information and Decisions Systems (LIDS) and a senior staff member at Lincoln Laboratory in the Energy Systems Group, designed an edX course that captures her methods and vision: Principles of Modeling, Simulation, and Control for Electric Energy Systems.

    EdX is a provider of massive open online courses produced in partnership with MIT, Harvard University, and other leading universities. Ilic’s class made its online debut in June 2021, running for 12 weeks, and it is one of an expanding set of online courses funded by the MIT Energy Initiative (MITEI) to provide global learners with a view of the shifting energy landscape.

    Ilic first taught a version of the class while a professor at Carnegie Mellon University, rolled out a second iteration at MIT just as the pandemic struck, and then revamped the class for its current online presentation. But no matter the course location, Ilic focuses on a central theme: “With the need for decarbonization, which will mean accommodating new energy sources such as solar and wind, we must rethink how we operate power systems,” she says. “This class is about how to pose and solve the kinds of problems we will face during this transformation.”

    Hot global topic

    The edX class has been designed to welcome a broad mix of students. In summer 2021, more than 2,000 signed up from 109 countries, ranging from high school students to retirees. In surveys, some said they were drawn to the class by the opportunity to advance their knowledge of modeling. Many others hoped to learn about the move to decarbonize energy systems.

    “The energy transition is a hot topic everywhere in the world, not just in the U.S.,” says teaching assistant Miroslav Kosanic. “In the class, there were veterans of the oil industry and others working in investment and finance jobs related to energy who wanted to understand the potential impacts of changes in energy systems, as well as students from different fields and professors seeking to update their curricula — all gathered into a community.”

    Kosanic, who is currently a PhD student at MIT in electrical engineering and computer science, had taken this class remotely in the spring semester of 2021, while he was still in college in Serbia. “I knew I was interested in power systems, but this course was eye-opening for me, showing how to apply control theory and to model different components of these systems,” he says. “I finished the course and thought, this is just the beginning, and I’d like to learn a lot more.” Kosanic performed so well online that Ilic recruited him to MIT, as a LIDS researcher and edX course teaching assistant, where he grades homework assignments and moderates a lively learner community forum.

    A platform for problem-solving

    The course starts with fundamental concepts in electric power systems operations and management, and it steadily adds layers of complexity, posing real-world problems along the way. Ilic explains how voltage travels from point to point across transmission lines and how grid managers modulate systems to ensure that enough, but not too much, electricity flows. “To deliver power from one location to the next one, operators must constantly make adjustments to ensure that the receiving end can handle the voltage transmitted, optimizing voltage to avoid overheating the wires,” she says.

    In her early lectures, Ilic notes the fundamental constraints of current grid operations, organized around a hierarchy of regional managers dealing with a handful of very large oil, gas, coal, and nuclear power plants, and occupied primarily with the steady delivery of megawatt-hours to far-flung customers. But historically, this top-down structure doesn’t do a good job of preventing loss of energy due to sub-optimal transmission conditions or due to outages related to extreme weather events.

    These issues promise to grow for grid operators as distributed resources such as solar and wind enter the picture, Ilic tells students. In the United States, under new rules dictated by the Federal Energy Regulatory Commission, utilities must begin to integrate the distributed, intermittent electricity produced by wind farms, solar complexes, and even by homes and cars, which flows at voltages much lower than electricity produced by large power plants.

    Finding ways to optimize existing energy systems and to accommodate low- and zero-carbon energy sources requires powerful new modes of analysis and problem-solving. This is where Ilic’s toolbox comes in: a mathematical modeling strategy and companion software that simplifies the input and output of electrical systems, no matter how large or how small. “In the last part of the course, we take up modeling different solutions to electric service in a way that is technology-agnostic, where it only matters how much a black-box energy source produces, and the rates of production and consumption,” says Ilic.

    This black-box modeling approach, which Ilic pioneered in her research, enables students to see, for instance, “what is happening with their own household consumption, and how it affects the larger system,” says Rupamathi Jaddivada PhD ’20, a co-instructor of the edX class and a postdoc in electrical engineering and computer science. “Without getting lost in details of current or voltage, or how different components work, we think about electric energy systems as dynamical components interacting with each other, at different spatial scales.” This means that with just a basic knowledge of physical laws, high school and undergraduate students can take advantage of the course “and get excited about cleaner and more reliable energy,” adds Ilic.

    What Jaddivada and Ilic describe as “zoom in, zoom out” systems thinking leverages the ubiquity of digital communications and the so-called “internet of things.” Energy devices of all scales can link directly to other devices in a network instead of just to a central operations hub, allowing for real-time adjustments in voltage, for instance, vastly improving the potential for optimizing energy flows.

    “In the course, we discuss how information exchange will be key to integrating new end-to-end energy resources and, because of this interactivity, how we can model better ways of controlling entire energy networks,” says Ilic. “It’s a big lesson of the course to show the value of information and software in enabling us to decarbonize the system and build resilience, rather than just building hardware.”

    By the end of the course, students are invited to pursue independent research projects. Some might model the impact of a new energy source on a local grid or investigate different options for reducing energy loss in transmission lines.

    “It would be nice if they see that we don’t have to rely on hardware or large-scale solutions to bring about improved electric service and a clean and resilient grid, but instead on information technologies such as smart components exchanging data in real time, or microgrids in neighborhoods that sustain themselves even when they lose power,” says Ilic. “I hope students walk away convinced that it does make sense to rethink how we operate our basic power systems and that with systematic, physics-based modeling and IT methods we can enable better, more flexible operation in the future.”

    This article appears in the Autumn 2021 issue of Energy Futures, the magazine of the MIT Energy Initiative More

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    3 Questions: Anuradha Annaswamy on building smart infrastructures

    Much of Anuradha Annaswamy’s research hinges on uncertainty. How does cloudy weather affect a grid powered by solar energy? How do we ensure that electricity is delivered to the consumer if a grid is powered by wind and the wind does not blow? What’s the best course of action if a bird hits a plane engine on takeoff? How can you predict the behavior of a cyber attacker?

    A senior research scientist in MIT’s Department of Mechanical Engineering, Annaswamy spends most of her research time dealing with decision-making under uncertainty. Designing smart infrastructures that are resilient to uncertainty can lead to safer, more reliable systems, she says.

    Annaswamy serves as the director of MIT’s Active Adaptive Control Laboratory. A world-leading expert in adaptive control theory, she was named president of the Institute of Electrical and Electronics Engineers Control Systems Society for 2020. Her team uses adaptive control and optimization to account for various uncertainties and anomalies in autonomous systems. In particular, they are developing smart infrastructures in the energy and transportation sectors.

    Using a combination of control theory, cognitive science, economic modeling, and cyber-physical systems, Annaswamy and her team have designed intelligent systems that could someday transform the way we travel and consume energy. Their research includes a diverse range of topics such as safer autopilot systems on airplanes, the efficient dispatch of resources in electrical grids, better ride-sharing services, and price-responsive railway systems.

    In a recent interview, Annaswamy spoke about how these smart systems could help support a safer and more sustainable future.

    Q: How is your team using adaptive control to make air travel safer?

    A: We want to develop an advanced autopilot system that can safely recover the airplane in the event of a severe anomaly — such as the wing becoming damaged mid-flight, or a bird flying into the engine. In the airplane, you have a pilot and autopilot to make decisions. We’re asking: How do you combine those two decision-makers?

    The answer we landed on was developing a shared pilot-autopilot control architecture. We collaborated with David Woods, an expert in cognitive engineering at The Ohio State University, to develop an intelligent system that takes the pilot’s behavior into account. For example, all humans have something known as “capacity for maneuver” and “graceful command degradation” that inform how we react in the face of adversity. Using mathematical models of pilot behavior, we proposed a shared control architecture where the pilot and the autopilot work together to make an intelligent decision on how to react in the face of uncertainties. In this system, the pilot reports the anomaly to an adaptive autopilot system that ensures resilient flight control.

    Q: How does your research on adaptive control fit into the concept of smart cities?

    A: Smart cities are an interesting way we can use intelligent systems to promote sustainability. Our team is looking at ride-sharing services in particular. Services like Uber and Lyft have provided new transportation options, but their impact on the carbon footprint has to be considered. We’re looking at developing a system where the number of passenger-miles per unit of energy is maximized through something called “shared mobility on demand services.” Using the alternating minimization approach, we’ve developed an algorithm that can determine the optimal route for multiple passengers traveling to various destinations.

    As with the pilot-autopilot dynamic, human behavior is at play here. In sociology there is an interesting concept of behavioral dynamics known as Prospect Theory. If we give passengers options with regards to which route their shared ride service will take, we are empowering them with free will to accept or reject a route. Prospect Theory shows that if you can use pricing as an incentive, people are much more loss-averse so they would be willing to walk a bit extra or wait a few minutes longer to join a low-cost ride with an optimized route. If everyone utilized a system like this, the carbon footprint of ride-sharing services could decrease substantially.

    Q: What other ways are you using intelligent systems to promote sustainability?

    A: Renewable energy and sustainability are huge drivers for our research. To enable a world where all of our energy is coming from renewable sources like solar or wind, we need to develop a smart grid that can account for the fact that the sun isn’t always shining and wind isn’t always blowing. These uncertainties are the biggest hurdles to achieving an all-renewable grid. Of course, there are many technologies being developed for batteries that can help store renewable energy, but we are taking a different approach.

    We have created algorithms that can optimally schedule distributed energy resources within the grid — this includes making decisions on when to use onsite generators, how to operate storage devices, and when to call upon demand response technologies, all in response to the economics of using such resources and their physical constraints. If we can develop an interconnected smart grid where, for example, the air conditioning setting in a house is set to 72 degrees instead of 69 degrees automatically when demand is high, there could be a substantial savings in energy usage without impacting human comfort. In one of our studies, we applied a distributed proximal atomic coordination algorithm to the grid in Tokyo to demonstrate how this intelligent system could account for the uncertainties present in a grid powered by renewable resources. More

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    MIT Energy Initiative launches the Future Energy Systems Center

    The MIT Energy Initiative (MITEI) has launched a new research consortium — the Future Energy Systems Center — to address the climate crisis and the role energy systems can play in solving it. This integrated effort engages researchers from across all of MIT to help the global community reach its goal of net-zero carbon emissions. The center examines the accelerating energy transition and collaborates with industrial leaders to reform the world’s energy systems. The center is part of “Fast Forward: MIT’s Climate Action Plan for the Decade,” MIT’s multi-pronged effort announced last year to address the climate crisis.

    The Future Energy Systems Center investigates the emerging technology, policy, demographics, and economics reshaping the landscape of energy supply and demand. The center conducts integrative analysis of the entire energy system — a holistic approach essential to understanding the cross-sectorial impact of the energy transition.

    “We must act quickly to get to net-zero greenhouse gas emissions. At the same time, we have a billion people around the world with inadequate access, or no access, to electricity — and we need to deliver it to them,” says MITEI Director Robert C. Armstrong, the Chevron Professor of Chemical Engineering. “The Future Energy Systems Center combines MIT’s deep knowledge of energy science and technology with advanced tools for systems analysis to examine how advances in technology and system economics may respond to various policy scenarios.”  

    The overarching focus of the center is integrative analysis of the entire energy system, providing insights into the complex multi-sectorial transformations needed to alter the three major energy-consuming sectors of the economy — transportation, industry, and buildings — in conjunction with three major decarbonization-enabling technologies — electricity, energy storage and low-carbon fuels, and carbon management. “Deep decarbonization of our energy system requires an economy-wide perspective on the technology options, energy flows, materials flows, life-cycle emissions, costs, policies, and socioeconomics consequences,” says Randall Field, the center’s executive director. “A systems approach is essential in enabling cross-disciplinary teams to work collaboratively together to address the existential crisis of climate change.”

    Through techno-economic and systems-oriented research, the center analyzes these important interactions. For example:

    •  Increased reliance on variable renewable energy, such as wind and solar, and greater electrification of transportation, industry, and buildings will require expansion of demand management and other solutions for balancing of electricity supply and demand across these areas.

    •  Likewise, balancing supply and demand will require deploying grid-scale energy storage and converting the electricity to low-carbon fuels (hydrogen and liquid fuels), which can in turn play a vital role in the energy transition for hard-to-decarbonize segments of transportation, industry, and buildings.

    •  Carbon management (carbon dioxide capture from industry point sources and from air and oceans; utilization/conversion to valuable products; transport; storage) will also play a critical role in decarbonizing industry, electricity, and fuels — both as carbon-mitigation and negative-carbon solutions.

    As a member-supported research consortium, the center collaborates with industrial experts and leaders — from both energy’s consumer and supplier sides — to gain insights to help researchers anticipate challenges and opportunities of deploying technology at the scale needed to achieve decarbonization. “The Future Energy Systems Center gives us a powerful way to engage with industry to accelerate the energy transition,” says Armstrong. “Working together, we can better understand how our current technology toolbox can be more effectively put to use now to reduce emissions, and what new technologies and policies will ultimately be needed to reach net-zero.”

    A steering committee, made up of 11 MIT professors and led by Armstrong, selects projects to create a research program with high impact on decarbonization, while leveraging MIT strengths and addressing interests of center members in pragmatic and scalable solutions. “MIT — through our recently released climate action plan — is committed to moving with urgency and speed to help wring carbon dioxide emissions out the global economy to resolve the growing climate crisis,” says Armstrong. “We have no time to waste.”

    The center members to date are: AECI, Analog Devices, Chevron, ConocoPhillips, Copec, Dominion, Duke Energy, Enerjisa, Eneva, Eni, Equinor, Eversource, Exelon, ExxonMobil, Ferrovial, Iberdrola, IHI, National Grid, Raizen, Repsol, Rio Tinto, Shell, Tata Power, Toyota Research Institute, and Washington Gas. More

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    Pricing carbon, valuing people

    In November, inflation hit a 39-year high in the United States. The consumer price index was up 6.8 percent from the previous year due to major increases in the cost of rent, food, motor vehicles, gasoline, and other common household expenses. While inflation impacts the entire country, its effects are not felt equally. At greatest risk are low- and middle-income Americans who may lack sufficient financial reserves to absorb such economic shocks.

    Meanwhile, scientists, economists, and activists across the political spectrum continue to advocate for another potential systemic economic change that many fear will also put lower-income Americans at risk: the imposition of a national carbon price, fee, or tax. Framed by proponents as the most efficient and cost-effective way to reduce greenhouse gas emissions and meet climate targets, a carbon penalty would incentivize producers and consumers to shift expenditures away from carbon-intensive products and services (e.g., coal or natural gas-generated electricity) and toward low-carbon alternatives (e.g., 100 percent renewable electricity). But if not implemented in a way that takes differences in household income into account, this policy strategy, like inflation, could place an unequal and untenable economic burden on low- and middle-income Americans.         

    To garner support from policymakers, carbon-penalty proponents have advocated for policies that recycle revenues from carbon penalties to all or lower-income taxpayers in the form of payroll tax reductions or lump-sum payments. And yet some of these proposed policies run the risk of reducing the overall efficiency of the U.S. economy, which would lower the nation’s GDP and impede its economic growth.

    Which begs the question: Is there a sweet spot at which a national carbon-penalty revenue-recycling policy can both avoid inflicting economic harm on lower-income Americans at the household level and degrading economic efficiency at the national level?

    In search of that sweet spot, researchers at the MIT Joint Program on the Science and Policy of Global Change assess the economic impacts of four different carbon-penalty revenue-recycling policies: direct rebates from revenues to households via lump-sum transfers; indirect refunding of revenues to households via a proportional reduction in payroll taxes; direct rebates from revenues to households, but only for low- and middle-income groups, with remaining revenues recycled via a proportional reduction in payroll taxes; and direct, higher rebates for poor households, with remaining revenues recycled via a proportional reduction in payroll taxes.

    To perform the assessment, the Joint Program researchers integrate a U.S. economic model (MIT U.S. Regional Energy Policy) with a dataset (Bureau of Labor Statistics’ Consumer Expenditure Survey) providing consumption patterns and other socioeconomic characteristics for 15,000 U.S. households. Using the combined model, they evaluate the distributional impacts and potential trade-offs between economic equity and efficiency of all four carbon-penalty revenue-recycling policies.

    The researchers find that household rebates have progressive impacts on consumers’ financial well-being, with the greatest benefits going to the lowest-income households, while policies centered on improving the efficiency of the economy (e.g., payroll tax reductions) have slightly regressive household-level financial impacts. In a nutshell, the trade-off is between rebates that provide more equity and less economic efficiency versus tax cuts that deliver the opposite result. The latter two policy options, which combine rebates to lower-income households with payroll tax reductions, result in an optimal blend of sufficiently progressive financial results at the household level and economy efficiency at the national level. Results of the study are published in the journal Energy Economics.

    “We have determined that only a portion of carbon-tax revenues is needed to compensate low-income households and thus reduce inequality, while the rest can be used to improve the economy by reducing payroll or other distortionary taxes,” says Xaquin García-Muros, lead author of the study, a postdoc at the MIT Joint Program who is affiliated with the Basque Centre for Climate Change in Spain. “Therefore, we can eliminate potential trade-offs between efficiency and equity, and promote a just and efficient energy transition.”

    “If climate policies increase the gap between rich and poor households or reduce the affordability of energy services, then these policies might be rejected by the public and, as a result, attempts to decarbonize the economy will be less efficient,” says Joint Program Deputy Director Sergey Paltsev, a co-author of the study. “Our findings provide guidance to decision-makers to advance more well-designed policies that deliver economic benefits to the nation as a whole.” 

    The study’s novel integration of a national economic model with household microdata creates a new and powerful platform to further investigate key differences among households that can help inform policies aimed at a just transition to a low-carbon economy. More