A [R]evolution in European Energy

‘Energy [R]evolution: A Sustainable World Energy Outlook’ is aimed at helping Europe regain a competitive advantage in the international technology race, while cutting ballooning fuel costs, creating jobs and slashing carbon emissions. A drive for renewables and energy efficiency can ensure that the EU does not fall behind China and the US in green technological innovation, argues the third edition of the report, commissioned by Greenpeace and EREC.

The study, carried out by the Institute of Technical Thermodynamics of the German Aerospace Centre (DLR), argues that the renewable power industry could support 8.5 million jobs by 2030 — if governments seize the opportunity to invest in a greener future. The report provides a detailed practical blueprint for cutting carbon emissions while achieving economic growth by replacing fossil fuels with renewable energy and energy efficiency. This phase-out of fossil fuels offers substantial benefits such as energy security, independence from world market fuel prices as well as the creation of millions of new green jobs, the authors contend.

Sven Teske, Greenpeace International’s Senior Energy Expert and co-author of the report observed: “Investing in people, rather than dirty and dangerous fossil fuels not only boosts global economic development but stems catastrophic climate change.”

The Energy [R]evolution scenario shows how to create about 12 million jobs, that is 8.5 million in the renewables sector alone, by 2030. Under business as usual global renewable power jobs would be only 2.4 million of the global power sector’s 8.7 million jobs. By implementing the Energy [R]evolution 3.2 million or over 33% more jobs globally will be created in the power sector.

In its advanced scenario, the document demonstrates that 97% of Europe’s electricity and 92% of its total energy use could come from renewables in 2050, cutting CO2 emissions by 95% and without the need to develop new nuclear power stations or carbon capture and storage technology. Even taking into account investment costs, curbing fossil fuel expenditure would save European economies an average of €19 billion ($27 billion) every year up to 2050, the study says.

The document identifies a number of key sectors, presenting a series of recommendations to policymakers.

Wind Technology

At the end of 2009 wind energy had increased its share of total power capacity in the EU to 9.1%, with a total installed capacity of 74,767 GW, which would, in a normal wind year, produce 4.8% of the EU’s electricity demand. But it is wind’s contribution to new generation capacity that is even more striking, with a 39% share of all power capacity installed in 2009, amounting to 10,163 MW of new installations. This was the second year running that more new wind was installed than any other generating technology.

The medium-term outlook for the wind industry also looks strong. On 7 October, 2009, the European Commission published its ‘Investing in the Development of Low Carbon Technologies’ — The European Strategic Energy Technology Plan (SET Plan) — document, in which it is estimated that €6 billion of investment in wind energy research is needed in Europe over the next 10 years. According to the European Commission’s Communication, “The return would be fully competitive wind power generation capable of contributing up to 20% of EU electricity by 2020 and as much as 33% by 2030. More than 250,000 skilled jobs could be created.”


Under the right policy framework, wind could supply 33% of Europe’s energy by 2030 (Source: REpower)

However, meeting the European Commission’s ambitions for wind energy would require 265 GW of wind power capacity, including 55 GW of offshore wind by 2020. The Commission’s 2030 target of 33% of EU power from wind energy can be reached by meeting EWEA’s 2030 installed capacity target of 400 GW wind. A total of 600 GW of wind energy would be needed in 2050 to meet 50% of the EU’s electricity demand. Of this, 250 GW would be onshore and 350 GW offshore. With a higher proportion of offshore wind energy, wind energy could produce more than 2015 TWh, the study finds.

Technology-specific recommendations include building a European offshore power grid. According to the study, electrical grids are no longer simply national infrastructure and they should become European corridors for electricity trading. A future European offshore grid would contribute to building a well-functioning single European electricity market that benefits consumers, with the North Sea, the Baltic Sea and the Mediterranean Sea leading the way. It would provide grid access to offshore wind farms, smooth the variability of their output and facilitate trade in electricity within Europe, thereby contributing dramatically to Europe’s energy security.

Another recommendation is to improve competition in the EU’s internal electricity market. A single European grid and effective competition in the European power markets would help to ensure affordable electricity prices and to secure supply. The report adds that new electricity infrastructure and ‘smart grids’ are also essential for reducing carbon price risk and fuel price risk. European electricity infrastructure is ageing and investment in new grids is needed, with the power system being operated intelligently.

The European Wind Initiative (EWI), in the framework of the EU’s SET Plan, should also be funded, as it is a roadmap for research to achieve the European 2020 objectives and beyond, and it focuses on key technology objectives to bring down the costs of onshore and offshore wind energy.

Photovoltaics Vision up to 2050

Despite the economic crisis, around 6.5 GW of photovoltaic systems were installed in the world during 2009 and steady market development is expected to continue in 2010 with growth of at least 25%. At the beginning of 2010, more than 21 GW of PV systems had already been installed in the world, delivering large quantities of electricity. On the one hand, the contribution of PV to electricity production in Europe is rising consistently, with PV contributing significantly to peak power generation in many countries, notably in Spain and Germany. On the other, the cost of PV electricity is constantly decreasing, with PV’s price reduction particularly marked in 2009 due to higher industrial capacity and increased competition.

A 20% learning curve factor (i.e. the price decreases by 20% each time the cumulated production is doubled) has been observed for the last 30 years and the trend is expected to continue, driving prices down substantially through the coming years and decades, which will render PV electricity more affordable and grid parity a likely reality for most European countries during the current decade. Residential grid parity is expected to be reached as early as 2011 in some Southern European regions.

It can reasonably be assumed that photovoltaic electricity will become a mainstream power source in Europe by 2020 and a major power source in 2050. A study carried out by the European Photovoltaic Industry Association with the support of the Consulting firm AT Kearney found that, provided some boundary conditions are met, PV could supply up to 12% of Europe’s electricity demand by 2020, thus representing 390 GWp of installed capacity and 460 TWh of electricity generation.

Solar panels on Munich airport. Many other similar projects are required to meet EU goals (Source: BP Solar)

For 2030 to 2050, the scenario assumes a progressive decrease in the growth rate, reflecting the increased contribution of other renewable energy sources. Nevertheless, the potential of photovoltaic electricity in Europe could be at least 50% higher by 2050. Available land area and buildings in ‘zero impact areas’ (areas not in competition with food production, natural reserves, housing, industry or other purposes) represent a potential of more than 5000 TWh of yearly PV electricity production.

The industry’s capacity to manage the foreseen growth of the PV market from 2010 to 2050 is not in question. All assumptions are based on current knowledge of technological evolution anticipated in the coming years. With the expected development of technologies such as concentrated PV and nanotechnologies, even higher efficiency and output performances can be expected.

In its technology-specific recommendations, the paper argues that sustainable feed-in tariffs (FiTs) have so far proven to be the best support schemes for successful PV deployment, though it adds that support schemes must evolve with the growing share of PV at different levels of competitiveness and that temporary policy support for PV is essential during its pre-competitive phase. In addition, streamlining and simplifying administrative and connection procedures is essential to accelerated PV deployment. An EU-wide introduction of ‘time of use’ electricity billing and net metering, as well as EU-funded research, development, demonstration and deployment programmes are essential for timely PV competitiveness.

Measures to foster the integration of PV in buildings should also be taken at national level, especially in the framework of the implementation of the Energy Performance of Buildings Directive, the paper says, concluding that PV is one of the few distributed electricity sources that can be seamlessly integrated into dense urban environments. As such, PV is a key technology to enable the transition from energy-consuming to energy-producing buildings.

The document concludes by saying that a steady development of photovoltaic electricity will require enhancing storage capabilities on the network in parallel to establishing aggregations of Virtual Power Plants (VPP) and smart grids as well as hybrid systems. Large-scale storage (using hydropower or other technologies) as well as decentralised storage devices will help to accelerate the deployment of PV across Europe.

Solar Thermal Technologies

Concentrated Solar Power (CSP) has the largest potential to convert solar radiation into electricity. Such plants are fully despatchable, meet the demand curve and can additionally provide other variable renewable conversion technologies with back-up. CSP generation is also highly predictable and can be coupled with thermal storage or hybridised with fossil or biomass-fired thermal generation, providing grid stability.

In Europe around 1800 MW of CSP plants are either operating or under construction, the report says. Currently, more than 30 parabolic trough plants of 50 MW each and one central receiver installation of 17 MW with 15 hours of storage are under construction in Spain. By the end of 2010 there will be 850 MW connected to the grid and the medium-term potential in European countries is estimated at 30 GW by 2020. There are open tenders and approved projects to build CSP plants all around the world, including the US, Algeria, Morocco, South Africa, the United Arab Emirates, China and Australia. Consequently, market perspectives for such plants are high and, furthermore, dual applications will bring important benefits in some specific areas, for example electricity and water desalination. Meanwhile, costs will be brought down by: innovation in systems and components, improvements in production technology, an increase in overall efficiency, an enlargement of operation hours through storage, bigger power blocks, a decrease in O&M costs, a learning curve in construction, and economies of scale.

Looking ahead, installed capacity in Europe is expected to reach 2 GW by 2012, 30 GW by 2020, 60 GW by 2030, and 125 GW by 2050. The technical potential in Europe can be estimated at 20 times that figure with reasonable generation costs. For long-term renewable supply in the EU, regional approaches are of paramount importance. Focusing on CSP, the EU and its member states should take advantage of the fact that the world’s largest potential is shared by Southern Europe and the Union’s neighbours in the Mediterranean. North African countries should also develop such clean technologies to serve their increasing domestic energy demand. In the medium term, CSP targets of 20 GW by 2020, 85 GW by 2030, and 430 GW by 2050 are feasible, taking into account the grid infrastructure to be developed in the region.

Policy support has been fundamental for the present growth of CSP. The European industry currently benefits from world leadership in the technology. Feed-in tariffs (FiTs) have proved to be the most effective tool to boost development with, for example, the FiT applied in Spain allowing for the extraordinary development of the sector. The best policy measure that could help implement CSP would be to settle a specific FiT in the countries with significant potential (Italy, Spain, Cyprus, Malta, France, Portugal, Greece, Bulgaria, Romania). Other EU countries could develop their manufacturing industry through statistical transfers and joint projects.

The chosen support scheme should foster innovation and allow for cost reduction with premiums or a higher FiT for plants with storage or hybridization. In addition, the Mediterranean Solar Plan (MSP) could be the driving force to develop the political, legal and financial tools for further deployment in the long term.

Considering solar thermal, the analysis concludes that the whole value chain, from manufacturing to installation including components, has now matured to form a strong and highly reliable industry in which Europe undeniably has a competitive edge. Several of today’s market leaders were the industry’s pioneers, but this booming sector has also attracted investments from conventional heating system manufacturers.

Continuing a decade-long trend, 2008 saw an impressive development in the solar thermal market, with a growth rate in excess of 60% in the EU and Switzerland, reaching 3.3 GWth of new capacity, representing 4.76 million m² of solar collector area. The overall installed capacity currently amounts to more than 27 million m² of glazed solar collectors, an equivalent of over 19 GWth. With an annual turnover exceeding the €3 billion mark, the European solar thermal industry employs over 40,000 people full time in production, marketing, sales and maintenance.

While current key areas for solar thermal technology applications are domestic hot water preparation and space heating for single and multiple family houses (with typical solar fractions of 15%-30% of the overall heat demand), as well as hot water preparation in the hotel and service sectors, in some European countries (e.g. Austria, Denmark, Germany and Sweden) solar assisted district heating systems are also well established. Moreover, the number of solar thermal systems for cooling and air conditioning, mostly in southern countries, as well as industrial process heat has increased significantly in recent times.

The importance of the heating and cooling sector has now been clearly recognised, as it currently corresponds to roughly half of the entire final energy demand (49%) and will continue to be a major player in the energy supply sector.

Overall energy demand will decline with the implementation of energy efficiency measures. Therefore, the deployment of renewable heating and cooling technologies must go hand in hand with major energy efficiency improvements in buildings to ensure a widespread take-up of renewable energy systems.

The 2020 goal of the European solar thermal sector is to have an installed solar thermal capacity of 272 GW, the equivalent of 388 million m² of solar collectors. This corresponds to an estimated 6.3% of the European Union’s 20% renewable energy target, representing an annual sectoral growth rate of 26%. In this case there would be an annual saving of 155 TWh of energy produced from fossil sources. A 9% improvement in energy efficiency by 2020 would reduce heating and cooling demand by 4297 TWh. On the basis of reduced demand and additional collector area, the solar fraction would be 3.6% by 2020. In the medium term (2030), the solar fraction would be 15%, based on a 20% reduction in demand compared with the 2006 level. And, in the long term (2050), the solar fraction would be 47%, based on a 31% reduction in demand from the 2006 level.

Mature products already exist to provide domestic hot water and space heating using solar energy. However, in most countries they are not yet the norm. Integrating solar thermal technologies into buildings at the design stage or when the heating (and cooling) system is being replaced is crucial, thereby lowering the installation cost as well as limiting additional building costs.

Moreover, untapped potential in the non-residential sector will be revealed as newly developed technology becomes commercially viable. Key applications and elements which will widely contribute to achieving these goals include: the Solar Active House, solar refurbishment/active solar renovation, high-density heat stores, solar thermal systems for medium temperatures/solar process heat, solar-assisted cooling, and new materials for solar thermal systems. These applications will need significant R&D investment to become mainstream, both from the private and public sector, as well as public support for market introduction. In a global market, the main competitive strength of the European solar thermal industry is high quality standards, driven by a fast-growing internal market. The public sector plays a crucial role by implementing solar building codes or introducing near-zero energy building regulations, both for new and refurbished buildings.

A Pathway to a New Revolution

When compared to other EU energy roadmaps for 2050, the Energy [R]evolution is ambitious. And yet, the authors insist, it is based on realistic assumptions that can deliver flexible energy which is closer to local businesses and communities, insist the authors, who add that a secure and balanced mix of energy sources for Europe’s energy system makes the Energy [R]evolution the most sustainable and credible blueprint for a genuine energy revolution.

Commenting, Greenpeace EU energy policy adviser Frauke Thies said: “Forty years ago, renewables were a dream; today, they are a reality; 40 years from now they should be the norm. Moving towards 100% renewables in 2050 doesn’t just make sense for the climate, it’s smart for the economy too. Coal and nuclear energy are dead weights for innovation, but renewables can deliver new technologies, jobs and energy security. To unlock this potential, the Commission must study the benefits and feasibility of a 100% green energy future.”

EREC Secretary-General Christine Lins added: “The Energy [R]evolution report demonstrates that it is technologically feasible to achieve 100% renewables in 2050 and reap its many benefits for the environment and Europe’s economy, while creating hundreds of thousands of jobs. All that is missing to bring about a truly sustainable energy future for Europe is political will.”

David Appleyard is chief editor of Renewable Energy World.


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