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THE TRANSITION TO HYDROGEN TECHNOLOGY

The Energy Magazine for S.E. Europe & Eastern Mediterranean

EUROPE NEEDS A STRATEGIC APPROACH TO BATTERIES

Issue No 38 Sept.-Oct. 2020 Price: 3 Euros

energyworldmag.com

WIND ENERGY FOR GLOBAL ECONOMIC RECOVERY

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BLOOMBERG: DO NOT IGNORE THE NUCLEAR OPTION


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The english edition for SE Europe & Eastern Mediterranean Issue No 38 September - October 2020 ISSUE PRICE 3 Euros

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US SANCTIONS ON NORD STREAM 2 AND TURKISH STREAM

BLOOMBERG: DO NOT IGNORE THE NUCLEAR OPTION

THE ELECTRIC CARS WITH THE LONGEST RANGE

RECOMMENDATIONS FOR A GREEN RECOVERY

GREEK GOVERNMENT AIMS FOR CLEANER TRANSPORT

HOW BATTERIES COULD CHANGE THE POWER

EUROPE NEEDS A STRATEGIC APPROACH TO BATTERIES

NEWS IN BRIEF

EDITORIAL

Contents

01 02 03 04 05 06 07 08 09


10 11 12 13 14 15 16 17 18

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TOP 10 NUCLEAR PLANTS IN THE WORLD

THE REAL DANGERS OF GLOBAL WARMING

DAILY GLOBAL CO2 EMISSIONS CUT THROUGH COVID

DANUBER ENERGY+: 8 PROJECTS IN THE NEXT PHASE

OPPORTUNITIES IN THE NATIONAL ENERGY PLANS

THE TRANSITION TO HYDROGEN TECHNOLOGY

EUROPE’S ENERGY SYSTEM INTEGRATION

HOW THE UK ENERGY MARKET WORKS

WIND ENERGY FOR GLOBAL ECONOMIC RECOVERY


Editorial

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THE GREAT ELECTRIC-BATTERY DIVIDEND technology’s strong run of good fortunes.

The global health pandemic has dealt a body blow to many areas of the economy but the battery industry looks set to reap significant rewards, even if it will also have to put up with a short-term slump in demand.

According to estimates by Bloomberg New Energy Finance, demand for rechargeable batteries will decline for the first time in 2020. Analysts expect shipments to slump 14% and Coronavirus lockdown measures, changing habits and shifting for 2021 to feel the pinch too, largely due to the pandemic’s investments have altered the course of energy and transport policy, cooling effect on motor sales. not just in Europe but worldwide, as governments mull the best way to shore up their economies in the wake of the pandemic. Electric car manufacturers rank among the biggest users of batteries and although giants like Volkswagen are pushing Investments in traditionally safe projects like coal power plants ahead with the launch of new models, demand is not expected are starting to fall apart as investors see the long-term and low- to recover until at least next year. risk payoffs of sectors like renewable power generation as the more attractive option. But the crisis was arguably well-timed for the battery industry, as costs have plummeted enough over the last decade for the One of the worst-hit areas is the auto industry, which was sector to ride out the economic slump. Prices have dropped already bracing to absorb lower sales figures this year even by nearly 90% thanks to economies of scale and technological before the virus outbreak hit. Some of the bigger firms have developments. applied for financial assistance to cushion the blow. Industry groups have already balked at the thought of even The combined effect means that electric cars, plus batteries as stricter targets getting the green light but any increase in ambition would likely have a stimulating effect on carmaker a result, are guaranteed to do well in the medium -and longterm, even if the impact of the coronavirus looks set to end the plans to boost EV production, which are already in motion. 4


PROTECTING THE PLANET IS EVERYONE’S

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News in brief

02 Russian gold exports top natural gas for first time ever The value of Russian gold exports has exceeded the country’s proceeds from natural gas exports for the first time in Russia’s modern history, due to low demand and prices for natural gas and surging gold exports, estimates from Russia’s central bank and customs showed, according to oilprice.com. Russia’s exports of gold reached US$3.58 billion in April and May, according to customs data reported by business outlet RBC. To compare, in those two months, Russia’s gas giant Gazprom, which has the monopoly in natural gas exports via pipeline, sold US$2.4 billion worth of natural gas outside Russia. According to preliminary estimates of Russia’s central bank, Russia’s pipeline natural gas exports stood at US$3.5 billion for the entire second quarter, less than the value of gold exports in just two of the three months in the same quarter.

Remote Medical International acquires SSI Group Remote Medical International, a global leader in workplace health and safety services for Fortune 100 corporations and government services prime contractors, announced it completed its acquisition of SSI Group. Based in the United Kingdom, SSI specializes in emergency response medical services for the oil and gas and renewable energy sectors, global risk management, and international safety. “This acquisition is part of our strategy to aggressively expand into new markets, notably renewable energy, broaden our offerings to include risk management, and build on our leading COVID-19 services,” said Wayne Wager, CEO of Remote Medical International. “The complimentary nature of our businesses adds to our ability to design bespoke solutions for our clients that save lives and improve the health of workers in diverse job sites around the world.” The combined expertise will produce a comprehensive range of COVID-19 medical services and solutions for businesses seeking to create safe back-towork situations under one Remote Medical International offering.

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Oil giants set first joint carbon target A group of the world’s top oil companies, including Saudi Aramco, China’s CNPC and Exxon Mobil, have for the first time set goals to cut their greenhouse gas emissions as a proportion of output, as pressure on the sector’s climate stance grows, according to Reuters. But the target, set by the 12 members of the Oil and Gas Climate Initiative (OGCI), means absolute emissions can rise as production increases. It is eclipsed by more ambitious plans set individually by the consortium’s European members, including Royal Dutch Shell, BP and Total. The members agreed on a common methodology to calculate carbon intensity and the targets could be extended to other sectors, such as liquefied natural gas and refining in the future, Bob Dudley (BP) said. London-based environmental thinktank Carbon Tracker dismissed the OGCI’s claim the targets were in line with the 2015 U.N.-backed Paris agreement to limit global warming by the end of the century.

Romania: 3.17 mln euros investments in new air quality monitoring stations A total of 60 new monitoring stations will be added to the existing National Air Quality Monitoring Network (RNMCA), environment minister Costel Alexe announced. The investment in this project amounts to EUR 3.17 million, and most stations will be installed in Bucharest. Once this project is implemented, the National Air Quality Monitoring Network will have a total of 208 stations, up from 148 at present. The money for this project will come from the budget of the Administration of the Environmental Fund (EUR 2.17 million) and the EU through the Large Infrastructure Operational Programme (EUR 1 million). “It is the biggest investment in air quality monitoring in the last ten years, since the National Air Quality Monitoring Network was put into operation,” Costel Alexe said.

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Energy transition

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EUROPE NEEDS A STRATEGIC APPROACH TO BATTERIES Driven by the ongoing clean energy transition, demand for batteries is expected to grow very rapidly in the coming years, making this market an increasingly strategic one at global level. According to some sources, the European market potential could be worth up to EUR 250 billion annually from 2025 onwards. This trend is further reinforced by the new and comprehensive legislative and governance framework for the Energy Union, successfully adopted under this Commission to accelerate the transition to a sustainable, secure and competitive EU economy.

Batteries have therefore been identified by the Commission as a strategic value chain, where the EU must step up investment and innovation in the context of a strengthened industrial policy strategy aimed at building a globally integrated, sustainable and competitive industrial base. In its long-term vision for a climateneutral economy by 2050 – “A Clean Planet for All”, the Commission shows how Europe can lead the way to climate neutrality, providing a solid basis for work towards a modern and prosperous climate-neutral economy by 2050. This vision makes clear that electrification is set to be one of the main technological pathways to reach carbon neutrality. Batteries will be one of the key enablers for this transition given the important role they play in stabilising the power grid and in the roll-out of clean mobility. Batteries offer a very tangible opportunity to use this deep transformation to create high value jobs and increase economic output. They can become a key driver for the EU’s industrial competitiveness and leadership, notably for Europe’s automotive industry. 8

Huge investments are needed to this end. It is estimated that 20-30 gigafactories for battery cells production alone will have to be built in Europe and their related ecosystem will need to be considerably strengthened. The scale and speed of investment needed means that the swift leveraging of private investment will be a key success factor. Today the European share of global cell manufacturing is just 3 per cent, while Asia has an 85 per cent share. If no action is taken to support the creation of a viable battery manufacturing sector, there is a risk that Europe falls irreversibly behind its competitors in the global batteries market, and becomes dependent on imports of battery cells and raw materials used in the supply chain. To prevent a technological dependence on our competitors and capitalise on the job, growth and investment potential of batteries, Europe has to move fast in the global race to consolidate technological and industrial leadership along the entire value chain. The Commission is working together with many Member States and


key industry stakeholders to build a competitive, sustainable and innovative battery ecosystem in Europe, covering the entire value chain. This is the main objective behind the European Battery Alliance (EBA), an industry-led initiative, which the Commission launched back in October 2017, to support the scaling up of innovative solutions and manufacturing capacity in Europe. The EBA is helping to foster cooperation between industries and across the value chain, with support at both the EU-level and from EU Member States. This approach can be seen as a reference case for EU action in other strategic sectors to continue building collectively on Europe’s industrial and innovation strengths to fill the gaps in its value chain. In this context, in May 2018, the Commission adopted the Strategic Action Plan on Batteries as part of the third ‘Europe on the Move’ mobility package. This brought together a set of measures to support national, regional

and industrial efforts to build a battery value chain in Europe, embracing raw materials extraction, sourcing and processing, battery materials, cell production, battery systems, as well as re-use and recycling. Less than a year after its adoption, significant progress has been made on the key actions set out in the Strategic Action Plan and industry has announced several major investments. This report provides the state of play on the main actions undertaken so far across the battery value chain and identifies the challenges and opportunities for the EU in this strategic sector for decarbonising and modernising the economy.

The drive for clean mobility will accelerate demand for batterypowered electric vehicles Transport in general and the automotive sector in particular will dominate growth in demand for battery cells in the midterm, as is already the case today. This will play a key role in driving down costs on the basis of significant economies of scale. Currently, there are more than 4 million electric vehicles on the road 9

globally. This is forecast to grow to between 50 and 200 million by 2028 and to reach up to 900 million by 2040. Batteries represent up to 40 per cent of the value of a car. Legislative initiatives and enabling measures under the Commission’s Low-Emission Mobility Strategy and the three ‘Europe on the Move’ mobility packages, will have an impact on both the supply and demand for electric vehicles and therefore for batteries. This includes the recently adopted Regulation on CO2 emission standards for new cars and most heavy-duty vehicles, and the revised Clean Vehicles Directive, which sets public procurement targets for low- and zero-emission vehicle fleets. The crisis surrounding car emissions and the high levels of air pollution in some cities is a cause of public concern and is stimulating demand for cleaner vehicles (significant reduction in demand for diesel-powered vehicles). This has prompted action by governments (e.g. banning future sales of combustion engine powered vehicles, diesel vehicle restrictions and bans in urban areas), as well as an overhaul of car


Global supply and demand of Li-ion batteries today and in the future and the European share in manufacturing

Supply dependency of materials along the value chain for electric vehicles’ batteries

Source: JRC Source: JRC

manufacturers’ business and investment strategies (e.g. switching production away from diesel to hybrid, electric, and fuel cell vehicles). The restructuring of transport charges and taxes to reflect infrastructure and external costs, including the application of the “polluter pays” principle in road charging, will also drive demand towards low- and zeroemission vehicles.

Storage for renewable energy will be a major driver of battery demand By 2050, the share of electricity in final energy demand will at least double to 53 percent. By 2030, it is expected that around 55 percent of electricity consumed in the EU will be produced from renewables (up from the current level of 29 percent). By 2050, this figure is expected to be more than 80 percent. For an effective integration of this renewable electricity, the whole range of energy storage technologies will be required, including pumped hydro, batteries, and chemical storage (hydrogen). The choice of solutions will depend on the location, capacity required and services to be provided. By providing the opportunity to store electricity temporarily and to feed it back into the grid, batteries can help society make better use of variable and decentralised renewable energy sources like wind and solar power. Batteries

will help to balance the electricity grid, complementing flexibility also provided by improved interconnections, demand response and other energy storage technologies. Batteries used for balancing the electricity grid can be stationary or mobile (i.e. the batteries in electric vehicles, provided that they are bi-directional). The global expansion of renewable energy over the past decade has already led to massive cost decreases, in particular for solar energy and onand off-shore wind power. This means, for example, that millions of consumers around the world are now able to produce their own electricity (mostly using solar panels on their rooftops), as well as store it and sell it back to the grid. The role and importance of energy storage, and in particular battery storage technologies, is set to increase significantly. In the medium-term, stationary batteries are expected to reach about 10 per cent of the battery market, but their role will further grow. In the 2050 perspective, storage will become the principal way of integrating renewables into the power system as thermal generation declines over time and the potential of demand-response is more fully used. Some scenarios which are assessed in the Commission’s Communication on “A Clean Planet 10

for All” suggest that annual electricity storage in 2050 could increase at least tenfold compared to 2015. By 2050, batteries are expected to play a far more significant role than pumped hydro storage technology, which is currently the main storage technology in the electricity system, accounting for over 90 per cent of the energy storage capacity in the EU.

A strategic opportunity

Global market forecasts project demand for lithium-ion batteries to grow significantly to up to 660 GWh by 2023, 1 100 GWh by 2028 and could reach up to 4 000 GWh by 2040, compared to only 78 GWh today. As the global market size increases, Europe is forecast to develop a capacity of 207 GWh by 2023, while European demand for electric vehicle batteries alone would be around 400 GWh by 2028, creating at least 3-4 million jobs. However, today the EU’s high dependency on battery cell imports could expose industry to high costs and risks in the supply chain and undermine the automotive industry’s ability to compete with foreign competitors, notably if there is a shortage in the light of the forecast increase in demand. This dependency is not only limited to battery cell production; access to


The global expansion of renewable energy over the past decade has led to massive cost decreases, in particular for solar energy and onand off-shore wind power. This means that millions of consumers around the world are now able to produce their own electricity as well as store it and sell it back to the grid

the five essential battery raw materials (lithium, nickel, cobalt, manganese and graphite) is also a major challenge for Europe’s security of supply as they are only available from a small number of countries. Battery-grade refining and processing facilities for almost all these materials are also currently concentrated in China, which consequently dominates the lithium-ion battery supply chain. The same applies to value chains of other key materials in electric vehicles, particularly to rare earths for highenergy density permanent magnets, which today are key to producing electric motors with the highest power densities. In some cases, access to these raw materials may be at risk because of political instability, which could lead to access being disrupted (including exposure to high taxes and duties on exports), or being hindered by the prevalent use of unethical and unsustainable mining practices. The expansion of the electric vehicle market will very substantially increase the demand for all of these raw materials in the next decade. Therefore, economically and geo-strategically, 11

the EU must make sure that it does not become dependent on primary raw materials and other processed materials along the battery value chain, sourced from abroad. The EU must diversify its sources of these materials, including domestic sources, make full use of its trade policy to ensure sustainable and secure supply, and deepen its shift towards a circular economy through recovery, re-use and recycling.

Research, innovation and demonstration Europe needs sustained and coordinated efforts to support investments in research and innovation in battery advanced materials and chemistries to enhance its performance on lithiumion (Li-ion) battery cell technologies, and to pursue leadership in the next generation of battery technologies. Current state-of-the-art batteries are largely based on lithium-ion chemistry, but the demand for higher energy density and performance requires short- to medium-term improvements, together with more radical changes towards a new generation of post-Li-ion batteries based on new advanced materials.


EU companies are well placed to take advantage of these technological developments. In the area of batteries, the EU is mobilising all its support instruments covering the entire innovation cycle, from fundamental and applied research to demonstration, first deployment and commercialisation. Coordinating battery-related research activities is key to harnessing the potential of this sector. Building on the collaborative efforts of the Strategic Energy Technology (SET) Plan and the Strategic Research and Innovation Agenda (STRIA), the Commission has launched a European Technology and Innovation Platform (ETIP) “Batteries Europe” to advance battery research priorities bringing together industrial stakeholders, the research community and EU Member States to foster cooperation and synergies between relevant battery research programmes. This platform enables co-operation between the numerous battery-related research programmes launched at EU and national levels, as well as private sector initiatives. Going forward, ETIP will prepare the ground for a co-programmed research and innovation partnership on batteries with industry proposed by the Commission under the future Research and Innovation Framework Programme, “Horizon Europe”, starting in 2021. The objective of the partnership is to support EU leadership by bringing together all

Horizon Europe research and innovation activities under one roof so as to develop a coherent and strategic programme, in cooperation with industrial players and the research community. The EU budget is already providing important funding opportunities to support research and innovation in batteries. The EU’s Framework Programme for Research and Innovation for 2014-2020, Horizon 2020, has granted EUR 1.34 billion to projects for energy storage on the grid and for lowcarbon mobility. In 2019, Horizon 2020 added a call to fund, under the European Battery Alliance, battery projects worth EUR 114 million. This will be followed by a call in 2020 amounting to EUR 132 million, covering batteries for transport and energy. The European Regional Development Fund is also providing support for research and innovation to promote an energy-efficient and decarbonised transport sector. The EU’s regions have shown an interest in establishing partnerships to take forward joint projects and further develop strong innovation ecosystems in the field of batteries. One such interregional partnership, focusing on advanced battery materials for electro-mobility and energy storage, was launched in October 2018 in the framework of the Smart Specialisation Platform on industrial modernisation. This open partnership has already expanded to include 22 regions and several pilot areas have 12

been established across the value chain to identify battery-related projects that could lead to successful commercial businesses. In addition, demonstration projects and pilots are important to test out the new technologies in near-market conditions, prior to ramping up production on a commercial scale. To support firstof-a-kind commercial scale energy demonstration projects, the European Investment Bank (EIB) provides loans, guarantees and equity-type funding through the InnovFin Energy Demo Projects (EDP) facility. The facility has already provided one loan of EUR 52.5 million to a demonstration plant in Sweden for the manufacturing of advanced Li-ion cells for batteries in transport, stationary storage and industry. Several battery industry projects in Croatia, France, Greece and Sweden have also benefited from support under the European Fund for Strategic Investments. In the next Multiannual Financial Framework, the new InvestEU Fund is expected to bring together under one roof the existing financial instruments which will make EU support more efficient and more flexible also in the field of batteries. The Innovation Fund established by the EU’s Emission Trading Scheme should provide around EUR 10 billion in the period 2020-2030 to support pre-commercial demonstration projects in low-carbon technologies, including energy storage. It will provide an opportunity to produce, test


The EU budget is already providing important funding opportunities to support research and innovation in batteries. The EU’s Framework Programme for Research and Innovation for 2014-2020, Horizon 2020, has granted EUR 1.34 billion to projects for energy storage on the grid and for low-carbon mobility

and demonstrate innovative battery technologies at scale, helping to bridge the gap between research and innovation results (for instance achieved in Horizon 2020), and commercial deployment of battery manufacturing, as aimed for in the European Battery Alliance. It will be implemented in full coordination with other relevant EU programmes, and, through blending could also contribute to Invest EU. The scale of the investment challenge is such that it cannot be met by public finance alone; hence the importance of effective mechanisms to attract private capital. A combination of public and private sources is therefore essential. Innovative financing schemes involving the public and private sector are being used in line with the EU’s objective on clean energy innovation. In October 2018, the Commission and ‘Breakthrough Energy’ agreed to launch a new model of public-private cooperation to catalyse more direct private investment into breakthrough European low-carbon technology companies and innovators that provide 13

solutions to climate change. An initial equity commitment of EUR 100 million is envisaged under this joint investment vehicle. This comprises EUR 50 million from ‘Breakthrough Energy (or its affiliates) and EUR 50 million provided by the Commission through InnovFin, the Horizon 2020 financial instrument managed by the European Investment Bank. In addition, the European Battery Alliance is examining the potential for crossborder breakthrough innovation projects with a view to accessing public funding that would be compatible with the EU’s State Aid rules under the Important Projects of Common European Interest (IPCEI) framework. Several EU Member States have already launched processes to identify potential consortia and are working together to design one or more IPCEI in this field. They aim to seek approval by the Commission as soon as possible.


Electricity

04

HOW BATTERIES COULD CHANGE THE POWER Lithium-ion batteries have been around for almost half a century – and now they are at the centre of the world’s next energy chapter.

The pressing need to address climate change and promote carbon management, coupled with technological developments and innovation, has caused global battery demand to soar and opened a window of tremendous opportunity. It’s important to identify steps to access this potential – and ensure the demand is matched by immediate and far-reaching collaborative action. Here are three ways batteries could power social, environmental and economic change in the world, as described in the Global Battery Alliance’s new report: • E nable 30% of the required emission reductions in power and transport sectors, key to achieving the Paris Agreement targets • P rovide 600 million people with access to electricity, reducing the number of people without electricity by approximately 70% • C reate 10 million safe and sustainable jobs and $150 billion of economic value in a fair value chain 14

By 2030, global battery demand is estimated to increase 14-fold, reaching 2,600 gigawatts per-hour. This surge may set in motion a sustainable cycle of growth, strengthening environmental protection and economic development, creating quality jobs and expanding access to electricity. Realizing the full potential of batteries, however, requires a much more sustainable value chain, which can only be delivered through extensive, collaborative action under the three core areas below. Foster a circular battery value chain Among a range of technologies, batteries are key to reducing transportation emissions, supporting a transition to a renewable power system. A circular battery value chain can quickly unite the transport and power sectors to ensure emissions remain within the Paris Agreement limit – for example, through smart grids and vehicle-to-grid. It would also allow us to reap more of batteries’ usage potential and end-of-life value.


Facilitate a just energy transition and economic development A sustainably scaled global battery value chain can play a crucial role in the achievement of many UN Sustainable Development Goals, including climate action and affordable, clean electricity. According to the report, around 600 million people will be provided with access to electricity, which would reduce the number of those lacking this resource by 70%. This could be achieved through the improved economics of solar home systems and micro-grid batteries. At the same time, there will be substantial efforts to eradicate child labour in the value chain before 2030, especially in the Democratic Republic of the Congo, which is home to more than 70% of global cobalt reserves. Battery demand for cobalt, a key material in the battery sector, is expected to increase and it is important to address the challenges associated with artisanal, small-scale mining (ASM). A similar rationale applies to the value chains of other key raw materials, including lithium and nickel. Transform the economy, creating additional value and new jobs The study concludes that, with the right type of collaborative action, approximately

10 million additional, safe and good quality jobs may be created by 2030, more than half of which would be in emerging economies. This can support an energy transition that includes sustainable job creation and benefits distributed across wide geographies. An additional component involves the creation of a supportive regulatory framework – for example, to adjust regulation for battery-enabled renewables as a dispatchable source of electricity for the grid. Discrepancies across countries and legal and regulatory flux dissuade investment and production. A sustainably scaled battery value chain, underpinned by fair and stable rules, can support the achievement of important, collective goals. Taking collaborative steps to power change Batteries can power change in the world, helping achieve the 2°C goal of the Paris Agreement and deliver unprecedented socioeconomic potential. But these achievements won’t occur in a vacuum. The Global Battery Alliance seeks to catalyse, connect and scale-up efforts to ensure the battery value chain is socially responsible, minimizes its environmental impact and creates economic value. 15

Additionally, with the commitment and engagement of over 60 members, joint efforts and activities are also needed with a wide range of sectors including academia, industry, government and NGOs. The challenges ahead are significant, but by no means insurmountable. Far-reaching, collaborative action, rooted in the values and framework outlined above, can set us on course to achieve our global sustainability ambitions. ERG and BASF, along with other GBA members, call on leaders across the value chain to work towards this vision with the collaboration of all sectors. We support intensified efforts to develop a more comprehensive action plan that could be agreed and implemented following the World Economic Forum Annual Meeting at Davos in 2020. The time to change the trajectory of the value chain is now. *The Global Battery Alliance report, “A vision for a sustainable battery value chain in 2030 – Unlocking the full potential to power sustainable development and climate change mitigation” was produced with the analytical support of McKinsey & Co. and SYSTEMIQ.


Electric mobility

05

GREEK GOVERNMENT AIMS FOR CLEANER TRANSPORT Greece on June 5 unveiled the legal framework and tax incentives to promote the use of electric cars, motorcycles and bicycles, as part of its 10-year climate plan for lower carbon emissions.

Greece now has only about 1,000 electric cars - 0.3% of its fleet - on its roads, a very low rate compared to other EU countries, such as Germany, where they account for about 10% of the fleet.

The plan

Presenting the country’s plan for moving to low-carbon mobility, Prime Minister Kyriakos Mitsotakis, said that Athens will aim for one in three new vehicles to be electric by 2030. “We are subsidising the purchase of new types of cars with 100 million euros for 18 months at the first stage,” Mitsotakis said. “This is expected to cover 25% of the cost for about 14,000 new electric cars.” The plan also includes subsidies for the purchase of electric taxis and motorbikes and for setting up charging stations across the country. Drivers of the new vehicles will be also exempted from any parking fees for two years. A recent study showed that carbon emissions dropped by about 40% in Athens amid a coronavirus-prompted lockdown from March to April as most Greeks stopped commuting by car. To meet EU-wide climate targets by 2030, 16

Greece has also vowed to close down all but one of its coal-fired electricity plants by 2023. The plants use lignite, a highly pollutant brown coal. Most of them operate in northern Greece and the southern Peloponnese. Mitsotakis announced tax breaks for new factories that will produce electric cars in those regions.

Eco friendly transportation

The government has been keen to promote electric vehicles as part of a broader push for environmentally friendly policies as the cars on Greece’s roads are among the oldest in Europe. The average of a car in Greece is 15.5 years, putting the country fourth from the bottom of the list of 27 European Union member -states, ahead of Romania, Lithuania and Latvia. The average car age in the EU is 11 years. Greece is in the same spot, fourth from last, among its EU peers when it comes to sales of low-emissions vehicles, with a rate of 0.5 per 1,000 residents, just ahead of Bulgaria, Latvia and Romania. According to government projections,


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between, 4,500 and 5,000 electric cars will be o Greek roads by next year. The aim is for one in three cars sold in Greece by 2030 to be electric.

A major study on electric vehicle market IENE completed a major study which deals with the prospects for the Electric Vehicle Market in Greece and SEE and potential business opportunities. This study, which commenced in November 2017, has been conducted as a multiclient study project backed by some of Greece’s leading energy companies including Systems Sunlight, the Mytilineos Group, Hellenic Petroleum, HEDNO S.A. (Hellenic Electricity Distribution Network Operator S.A.) and KG Law Firm. The study was presented to the above group of companies on June 14 in a closed session organized by IENE and held in the offices of KG Law Firm, a long standing corporate member and supporter of IENE. The study describes the current developments in the electric vehicle architecture and battery technology focusing on the current trends of the

EV market in Europe and globally. In addition, it identifies the obstacles,which Electric Vehicles (EVs), as a disruptive technology, face in their path towards adoption. These challenges are mainly the current EV technology limitations resulting to a high cost of acquisition, limited electric driving range, limited charging infrastructure availability and long charging time. On the other hand,aggressive support policies, zero-energy-vehicle mandates and fiscal incentives have been identified as the main drivers for EV expansion and adoption globally. Observation of the EV market has shown a very high learning curve, which prominent analysts estimate that it could lead to deployment 60 million new EVs per year by 2040. This is expected to occur as a result of the rapid decline of the cost intensive EV battery component and its technology development towards higher energy density, which consequently will make EVs more competitive against conventional ICE vehicles. In addition, the study explores the EV market development in Greece, which has performed poorly the first years of its 17

existence. However, market initiatives have been on sight, with the most important one being the proposed development of a nationwide charging network system by Greece’s DSO, currently under review by the Regulatory Authority for Energy. The legislative framework governing EV adoption in the country, which is currently under development, is being thoroughly reviewed. Also, the introduction of EVs is considered as part of the solution, coupled with the high penetration of RES, for the decarbonization of the on-road transportation. Avoided tailpipe GHG emissions and other air pollutants by substituting conventional ICE vehicles, while it is one of the main environmental benefits of EVs,it is not the only one. Noise pollution mitigation, avoided life cycle emissions of vehicle components as well as the avoided primary energy use, wastewater generation and emissions from the fuel refinery process are some significant environmental contributions of electric mobility.

Energy reconstruction

A key finding of the study is that


Noise pollution mitigation, avoided life cycle emissions of vehicle components as well as the avoided primary energy use, wastewater generation and emissions from the fuel refinery process are some significant environmental contributions of electric mobility

EV adoption mandates partly the reconstruction of the energy sector. Charging technologies are developing rapidly towards standardization and interoperability, while different charging schemes and strategies will be used by new market entities, PEV aggregators, aiming in providing optimal charging services from a cost-benefit perspective, while performing temporal allocation of EV charging loads to provide ancillary services to the grid. Moreover, new installed power generating capacity will be required in the region to facilitate EV penetration, while events during mass EV charging like harmonic distortion and distribution congestion must be thoroughly considered and mitigated in each system separately. The aim of this latest IENE study has been to provide an indication for the present and future of EV markets in Greece, South East Europe and globally and describe latest trends especially with regard to investment opportunities. Such opportunities are to be found following the impact of EV adoption in the automotive manufacturing sector and the mass expansion of the energy 18

sector caused bythe electrification of transport. Consequently, this study will provide a much needed reference to market participants in order to assess market development with regard to power generation, power distribution and socioeconomic cost allocation for infrastructure installations.


Overview

06

RECOMMENDATIONS FOR A GREEN RECOVERY Eurelectric released a set of policy recommendations for a smooth and efficient recovery of the power sector.

They address the necessary measures for tackling the negative impacts of lockdowns on several segments of the electricity value chain, including generation, distribution grids, markets, as well as retail and customer services. The COVID-19 outbreak has pushed the EU economy into one of the biggest crises of the century. An assessment conducted by Eurelectric throughout the lockdown period shows that the entire electricity value chain was affected by the measures taken to limit the spread of the virus.

What the sector wants

To reset its activity and accelerate the clean energy transition, the power sector call for: • The establishment of concrete measures for ramping up the deployment of zero carbon infrastructure projects, as well as for closely monitoring the risk of shortage of critical materials and of skilled workforce (i.e. construction and maintenance) via the national recovery plans. • S timulating capital-intensive 19

investments in carbon-neutral generation through an efficient framework that provides long-term visibility and certainty. • Su pporting the electrification of buildings and transport, while paving the way for ambitious skilling objectives for workers, through the Renovation wave initiative. • E nabling the equipment of entrants to the labour market with the right skills and provide access to adequate reskilling and upskilling for experienced employees, particularly in digital and new technologies. • T he preservation of the financial capacity of distribution grids and the mitigation of economic risks for electricity suppliers, as they have been directly impacted by the break on bills and delayed payments.

Horizontal recommendations

• P rioritise and accelerate low-carbon infrastructure projects in national recovery plans to recuperate registered delays and achieve climate goals set


at the national and EU levels. Such projects will bring direct benefits to local economies and act as catalysts for the economic development of other EU strategic initiatives, such as those on clean mobility, solar and wind energy, and batteries. • E nsure a robust EU ETS system, with the Linear Reduction Factor (LRF) and the Market Stability Reserve (MSR) as the two main policy tools. Their parameters will require reassessment in light of the upcoming 2030 target increase and expected MSR review. • Mon itor and address potential risks of shortage in the supply chain with regard to critical materials and components, as well as potential shortage of skilled workforce (i.e. construction and maintenance); • T ake appropriate measures given the significant impact that lower electricity consumption and power prices have on the balance sheets of energy utilities and on their long-term ability to invest in the energy transition. While those are part of market risks, the EU and national

authorities should be aware of this impact and act accordingly.

Committee-specific recommendations Electrification & Sustainability • Prioritise a system-wide approach towards electrification of buildings and transport as a part of the upcoming Renovation Wave initiative; • Ensure that digital skills and technologies are recognised as key enablers for a socially responsible digital transition. This would require both equipping new entrants to the labour market with the right skills and providing access to adequate reskilling and upskilling for experienced employees. Generation & Environment • Guarantee that a long-term schedule - anticipating the expected allocation of support for the deployment of renewables - is published, in order to ensure visibility and certainty for investors; • Establish a swift process ensuring that operators are given sufficient time 20

to comply with the emission limit values in their permits and/or requirements of the Industrial Emissions Directive (IED). Delays in refurbishments could lead to certain sites not being able to fulfil these requirements on time. Markets & Investments • Ma ke sure that the regulatory framework is more conducive to capitalintensive investments in carbon-neutral generation, in particular including more long-term arrangements. Otherwise, there is a risk of lock-in related to fossil fuels and the carbon neutrality goals for 2050 would become more challenging to reach. Distribution & Market Facilitation • P reserve and increase the investment capacity of DSOs to ensure the timely infrastructure deployment (i.e. smart meters roll-out, renewables and charging stations connection, grid modernisation and maintenance works) thus supporting the entire industrial value chain (suppliers, manufacturers, subcontractors); • A lleviate the financial strains and


The COVID-19 outbreak has pushed the EU economy into one of the biggest crises of the century. An assessment conducted by Eurelectric throughout the lockdown period shows that the entire electricity value chain was affected by the measures taken to limit the spread of the virus

regulatory limits put on DSOs in order to maintain investment and operation capacity at the pace of pre-pandemic levels and allow them to envisage a higher level of investments; • T ake regulatory measures to recognise the increased capital risk borne by DSOs due to delays of payment deadlines granted to businesses, and ensure the solvency of the entire electricity system; • St reamline and fast-track access to the EU funding instruments for distribution infrastructures to alleviate the increase of credit financing costs and decrease costs for taxpayers.

Customers and Retail Services

• E stablish government support schemes to enable customers to pay their electricity bills and thus reduce the impact of bad debt on companies; • I n places where prohibition of disconnection and payment plans have been put in place: – Create specific funds through the state 21

budget that can relieve the financial and economic burden from suppliers through advanced payments and bad debt compensation; – Postpone payments due by suppliers for taxes, levies and grid charges until bills have been paid; – Design a mechanism to recover the excess bad debt linked to the current crisis throughout the system over time. • I n case of default of existing suppliers, make sure that the costs for the system can be recovered without endangering other suppliers and generating a systemic risk.


Electric mobility

07

THE ELECTRIC CARS WITH THE LONGEST RANGE Eliminate anxiety with these electric vehicles that go the distance. Electric cars have come a long way. You now have a variety of options that can get more than 320 km miles of range, including SUVs, hatchbacks and sedans. In fact, all of the models on this list yield more than 320 km of range.

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2020 Porsche Taycan Porsche’s sedan feels every bit as substantial as the company’s own Panamera, and every bit as sporty as its 911. While build quality is excellent, and the options list is extensive, more important to an enthusiast is the fact that the Taycan’s electric propulsion doesn’t get in the way of driving – actually, we’d argue that its seamless implementation improves the behind-the-wheel experience. Range per full charge: 320 km | Charge time at 240V: 9 hours (est) | Power: 670 horsepower, 626 lb-ft

2020 Nissan Leaf Plus The Nissan Leaf is available in two different forms – the Leaf and the Leaf Plus. Opt for the Leaf Plus, and you get the Leaf’s sleek styling, roomy interior, and ProPilot Assist semiautonomous driving, as well as 360 km of range. Range per full charge: 360 km Charging time at 240V: About 11.5 hours | Power: 214 horsepower, 250 lb-ft of torque | Battery: 62-kWh lithium-ion

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2020 Jaguar I-Pace The 2020 Jaguar I-Pace is the smallest crossover Jaguar produces and has 370 km of all-electric range. It also offers the attractive styling and entertaining drive experience the Jaguar name represents. And even though it doesn’t look like a typical SUV, the I-Pace has some off-road chops. Range per full charge: 370 km | Charge time at 240V: 12.9 hours | Power: 394 horsepower, 512 lb-ft of torque Battery: 90-kWh lithium-ion

2020 Kia Niro EV The Kia Niro has a stylish yet mainstream exterior and a handsome and functional 5-passenger interior. With 380 km of range, it also benefits from an excellent 10-year/160,000-km powertrain warranty, a range of trims, and a strong roster of safety and tech features. Range per full charge: 380 km | Charge time at 240V: 9.5 hours | Power: 201 horsepower, 291 lb-ft of torque Battery: 64-kWh lithium-ion

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2020 Hyundai Kona Electric The all-electric version of the likable Hyundai Kona subcompact SUV provides a range of 415 km. It also possesses all the versatility, likability, and features of the gas-powered Kona, which is known for its value as well as its good looks. Range per full charge: 415 km | Charge time at 240V: 9.5 hours | Power: 201 horsepower, 291 lb-ft of torque Battery: 64-kWh lithium-ion

2020 Chevrolet Bolt EV When it first came out, the Chevrolet Bolt EV was the first mainstream vehicle to attain over 370 km of range per charge. As the electric-car segment continues to improve, the Bolt was updated as well. Its range is now 370 km, which is best in class. The Bolt is quick, quiet, compliant, and versatile. It makes an excellent city car or runabout, and with some planning for recharges can even be a road-tripper. Range per full charge: 370 km | Charge time at 240V: 10 hours (est) | Power: 200 horsepower, 266 lb-ft of torque Battery: 60-kWh lithium-ion

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2020 Tesla Model Y Tesla’s newest model, the Model Y, is a 7-passenger SUV. It’s akin to a scaled-down version of the Model X but without the funky falcon-wing doors. The interior delivers a feeling of spaciousness thanks to an oversize panoramic glass roof, which eliminates any hint of claustrophobia within the 7-passenger cabin. Range per full charge: 506 km | Charging time at 240V: 10 hours (est) | Battery: 75-kWh lithium-ion polymer

2020 Tesla Model X Long Range Able to travel more than 520 km on a single charge, accelerate to 60 mph in less than three seconds, and carry up to seven people, the 2020 Tesla Model X makes owning an electric vehicle a viable alternative to a gasoline-powered model. Range per full charge: 520 km | Charge time at 240V: 10 hours (est) | Battery: 100-kWh lithium-ion

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2020 Tesla Model 3 Long Range This sleekly styled, 5-seat sedan dazzles with ample electric range, cool technology, and a starting price of about $40,000. For those who can swing the lease or loan payment, the smallest and least expensive Tesla offers day-to-day usability, surprisingly fun road manners, impressive safety ratings, and an intriguing glimpse of a gasoline-free future. Range per full charge: 531 km | Charge time at 240V: 10 hours (est) | Battery: 75-kWh lithium-ion

2020 Tesla Model S Long Range The Tesla Model S is an electric 5-passenger sportback that offers up to 600 km of driving range on a single battery charge. Inside, a huge 17-inch screen dominates the minimalist interior and controls virtually all vehicle functions. Meanwhile, a pair of electric motors generate massive torque permitting this sensible but sleek car to outrun most honest-to-goodness supercars while hauling up to 63.3 cubic feet of cargo. Range per full charge: 600 km | Charge time at 240V: 12 hours (est) | Battery: 100-kWh lithium-ion

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Πυρηνική ενέργεια Bloomberg*

08

BLOOMBERG: DO NOT IGNORE THE NUCLEAR OPTION It may be controversial. It’s also a reliable source of clean power that can replace fossil fuels.

With billions of workers at home and factories idle, early April saw daily carbon emissions fall 17% compared to 2019 averages, according to a study by a team of international scientists published on June. That’s great. Unfortunately, it only takes us back to 2006 levels, and it’s temporary. For an even more painful reminder of the scale of the climate task, consider that for 2020 overall the same researchers from the University of East Anglia and Stanford estimate coronavirus lockdowns will amount to an emission reduction of about 4% to 7% – the sort of decline we need every year to limit warming to 1.5 degrees Celsius, the boldest global target. The challenge is clear. So why are we leaving a major existing source of low-carbon power out of green stimulus discussions, as the European Union appeared to do last week? Nuclear energy is hugely polarizing, geopolitically sensitive and not without risk. It’s also a reliable source of clean power that can displace fossil fuels and effectively work in tandem with 28

renewable energy. True, new plants have proven slow and costly. By managing projects (a lot) better and tinkering with the models less, that can change. We can certainly keep existing reactors alive reasonably cheaply. Small, modular plants, already in the pipeline, may make a difference, too. Leaving nuclear off the agenda in the debate on a postpandemic, carbon-light recovery is a mistake we will rue. Simply, it’s about emissions. We have to make electricity production greener, so it can in turn become a low-carbon energy source for transport, heating and more. Atomic energy does generate emissions during parts of its lifecycle, like uranium mining. Still, globally, it avoided 63 metric gigatons of carbon dioxide from 1971 to 2018, according to the International Energy Agency. Without it, emissions from electricity generation would have been 20% higher. Yet rather than increasing when we want cleaner power, it’s fading fast in the West as aging plants close, and is often replaced with cheap gas. Nuclear generation did rise by 2.4% in 2018, its fastest growth since 2010 – but only thanks to China.


Glowing out

It’s not that solar and wind are unable to replace fossil fuels. They have made huge strides, and costs have deflated dramatically. Without nuclear, though, achieving a transition in the necessary time frame requires extraordinary extra effort and cost – around $1.6 trillion in additional investment in the electricity sector of advanced economies between 2018 and 2040, according to the IEA. That’s a big number even from a body that has admittedly underestimated renewables before. It also wastes an existing resource. To cut emissions in the electrical sector by the 45% needed to keep global warming to 1.5 degrees Celsius would require adding by 2030 as much as four times the total solar and wind capacity built over the past two decades, BloombergNEF founder Michael Liebreich estimated last year. Adding transport, heating and industry would raise that to as much as 15 times the current installed capacity, he said. The IEA, meanwhile, reckons that wind and solar capacity has increased by about 580 gigawatts in advanced economies

over the past two decades – and that offsetting nuclear’s decline will mean adding five times that in the next 20 years. For an idea of scale, consider Liebreich’s example: In 2018, German utility EON SE’s Isar-2 nuclear power plant in Bavaria wasn’t far off producing the same amount of clean energy as all the wind turbines in Denmark. Then consider that nuclear operates more than 90% of the time – a reliable base for fluctuating wind and solar – and occupies less space. What about the economics? Here, the picture is less positive. While the cost of solar has plummeted, nuclear has soared. Extending the life of existing plants, where possible, is still a nobrainer, especially if a reasonable carbon price is included in the calculation. Many of these hulking plants are now fully depreciated. A sustainable reduction in carbon, though, requires new plants – and the industry has done itself no favors. Experiences over the past decade or so 29

To cut emissions in the electrical sector by the 45% needed to keep global warming to 1.5 degrees Celsius would require adding by 2030 as much as four times the total solar and wind capacity built over the past two decades, BloombergNEF founder Michael Liebreich estimated last year


Popular worries about safety, waste and decommissioning are understandable – even if a comparison of fatalities per terawatt hour shows other forms of energy are far deadlier, given air pollution and industrial accidents

will deter future construction, with rare exceptions like Britain. Projects have overrun, and costs have soared. The most egregious examples are Electricite de France SA’s Flamanville nuclear plant, now more than a decade behind schedule and expected to start around 2023; and the Hinkley Point C reactor in England, delayed and based on an eyewatering energy purchase price of 92.50 pounds ($114) per megawatt-hour in 2012 money, guaranteed for 35 years. Even China has hit delays in Taishan. None of this, though, should obviate a discussion on how to do it better, with more design standardization, some innovation and simply by repeating proven construction practices, as suggested in a 2018 Massachusetts Institute of Technology study. Including nuclear in green recovery plans can accelerate that process. The push toward smaller, modular reactors will help too, though large-scale application may be some time away. Popular worries about safety, waste and decommissioning are understandable – even if a comparison of fatalities per 30

terawatt hour shows other forms of energy are far deadlier, given air pollution and industrial accidents. There is a messy geopolitical layer here, too, as China and Russia enthusiastically use subsidized projects as diplomatic tools. For now, though, it needs to be an option on the table. The carbon cost of ignoring nuclear is just too great.

*Source: Bloomberg Opinion/By Clara Ferreira Marques


Pipelines

09

US SANCTIONS ON NORD STREAM 2 AND TURKISH STREAM US senators announced a bill expanding sanctions on Russia’s Nord Stream 2 and Turkish Stream natural gas pipelines and targeting the projects Washington says will boost Moscow’s economic and political influence in Germany and other European countries.

The Protecting Europe’s Energy Security Clarification Act follows legislation signed by President Donald Trump last year, which prompted Swiss-Dutch company Allseas to halt undersea work, delaying the project.

continues under the name “Balkan Stream” to Bulgaria, Serbia, Hungary and Austria.

Two Russian-owned pipe-laying vessels may now finish the remaining 100 miles (160 km) of the project, which is led by state-run Gazprom. The pipeline could be launched by late 2020 or early next year, Russian President Vladimir Putin has said.

Shaheen said the pipeline threatens Ukraine and Europe’s energy independence and “gives Russia an opening to exploit our allies.”

The new bipartisan legislation, spearheaded by Senators Ted Cruz, a Republican, and Jeanne Shaheen, a Democrat, could stop the Nord Stream 2 project by expanding sanctions to include penalties on parties involved in pipe-laying activities and parties providing underwriting services, insurance or reinsurance on the project.

The impact on the pipelines

It is less clear what the impact could be on TurkStream or Turkish Stream, the gas pipeline bringing Russian gas to the European territory of Turkey across the Black Sea. From Turkey, the pipeline 31

Cruz said it “makes clear those involved with vessels installing the pipeline will face crippling and immediate sanctions.”

The bill must be passed by both chambers of Congress and signed by Trump. It adds sanctions on companies providing services or facilities for the vessels, including welding equipment, retrofitting or tethering of the ships. Many politicians and energy companies in Germany support Nord Stream 2 as Europe’s biggest economy seeks to end the use of coal and nuclear power. The Trump administration has touted exports of US liquefied natural gas (LNG) as an alternative to Russian supplies, calling it “freedom gas.” US LNG producers are struggling due to sagging global demand.


Nord Stream 2 spokesperson Jens Mueller said European households and industries will pay “billions more” for gas if the pipeline is not built. “Decisions about European Union energy policy should be left to Europeans,” Mueller said. German Economy Minister Peter Altmaier criticized Washington for “escalating this sanctions threat, which is extraterritorial and thus in conflict with international law.” The pipe-laying ship Academic Cherskiy, which Moscow could use to finish Nord Stream 2, changed ownership from Gazprom Fleet to regional firm STIF, a Russian registry showed this month. STIF was linked to a group of Gazprom companies as of 1 April but there was no data on STIF’s ownership since then, Gazprom spokesman Sergei Kupriyanov told Reuters. The Academic Cherskiy is moored near Germany’s Mukran port in the Baltic, the staging area for the pipeline’s construction, Refinitiv Eikon data showed.

Russian ambassador: Nord Stream 2 will be implemented

Construction of the Nord Stream 2 gas pipeline will be implemented in spite of the obstacles from the United States, Russia’s Ambassador in Washington Anatoly Antonov told. “In the past days there was another wave that economic sanctions should be slapped on Russia because of Nord Stream 2. I can just say that the project will be implemented despite all the obstacles created for us by the United States,” he stressed. The Nord Stream 2 pipeline is set to run from the Russian coast along the Baltic Sea bed to the German shore through the exclusive economic zones and territorial waters of five countries - Russia, Finland, Sweden, Denmark, and Germany, thus bypassing transit countries of Ukraine, Belarus, Poland and other Eastern European and Baltic states. Each of the pipeline’s two stretches will have a capacity of 27.5 bln cubic meters. Gazprom’s European partners in the project are Germany’s Wintershall and Uniper, Austria’s OMV, 32

France’s Engie and Royal Dutch Shell. The Switzerland-based Allseas, which laid pipes for the Nord Stream 2 pipeline, suspended its pipelay activities and withdrew vessels involved in the project due to the threat of the US’ sanctions in late December 2019. Chief Executive Officer of Gazprom Aleksei Miller said that the construction would be completed by its own efforts. Russian Energy Minister Alexander Novak has said that the construction of the gas pipeline may be finalized using the ship-laying vessel ‘Akademik Chersky’. The project is 93% completed to date. In January, President Vladimir Putin said that the construction will be completed and the gas pipeline will be launched before the end of this year or in the first quarter of next year.

TurkStream: Tough challenges ahead The newly operative TurkStream gas pipeline will have a limited impact on the market due to tougher competition


for Russia in both Turkey and Southeast Europe, economic hardship and a surge in liquefied natural gas (LNG) imports, wrote Dimitar Bechev, research fellow at the University of North Carolina. Russian President Vladimir Putin and his Turkish counterpart Recep Tayyip Erdogan inaugurated the 930-km long TurkStream pipeline on Jan. 8. It began pumping gas at the start of the year with an expected annual capacity of 31 billion cubic meters. The pipeline is seen as a symbol of the burgeoning ties between Russia and Turkey. TurkStream - a watered-down version of its predecessor, the frozen South Stream - is guaranteed to give Russia and Turkey certain advantages, including Russian gas giant Gazprom’s ability to directly access the Turkish market without having to deal with countries sitting in between, Bechev said in Sharq Forum, an independent international network. It also gives Turkey the ability to receive and transfer Russian gas to the European Union, he said.

But the duel pipeline project has its fair share of challenges, Bechev added. While the second phase of the project, known as the Balkan Stream, has fallen behind schedule, the increasingly competitive gas market in Turkey and its Southeast European neighbourhood is causing Gazprom’s share to contract, the article said. There has been a decrease in imports from Russia from Iran, Azerbaijan, Greece and Southeast Europe over the last few years. Bechev attributed Russia’s loss of grip on local markets to shrinking demand in Turkey, the region’s largest market. ‘’Since March when the COVID-19 pandemic hit Turkey and its neighbours, consumption appears to be in sharp decline. Turkey’s Electricity Producers’ Association, for instance, reported a drop of 20 percent in the output of electricity at power plants running on natural gas in April,’’ he said. Another game changer is LNG imports, 33

which jumped from 22 percent of the total volume in 2018 to 28 percent in 2019, the article said, as Turkey continues investing in its LNG import capacity. The emergence of Azerbaijan as Gazprom’s rival supplier to the markets in Turkey and in Southeast Europe is another factor likely to affect the future of the pipeline, Bechev wrote. ‘’In the short term, TurkStream will remain underused. Turkey is not in a position to utilise the full capacity of the pipeline’s first string because of the looming recession and the cheaper alternatives,’’ Bechev wrote.


Renewables

10

WIND ENERGY FOR GLOBAL ECONOMIC RECOVERY Wind power is a key building block for economic recovery from the impact of COVID-19, which will enable governments to renew critical infrastructure for a sustainable future.

According to GWEC, the wind industry will help to deliver the jobs, clean and affordable power and energy security needed for a sustainable economic recovery. The COVID-19 pandemic has caused untold suffering and created an unprecedented economic and social challenge for the world. Countries and communities are facing economic contractions, with surging unemployment, disruptions to capital flows, and growing debt burdens. Governments and financial institutions are doing their best to respond. While rightly focusing on fighting the pandemic and safeguarding their citizens, policy makers across the world are starting to plan for economic recovery. Estimates of stimulus packages that have already been launched or announced are in excess of (USD) $10 trillion globally. The lasting impact of COVID-19 and the pace of global recovery will depend on the actions that we all take over the coming months. To achieve a sustainable and lasting economic recovery, these 34

actions should focus on long-term impacts as well as the short-term need to generate growth and jobs. Governments need to ensure that their primary focus is on facilitating the clean energy transition, upholding emission standards and targeting public investments to “Rebuild Better� for the future.

The role of the wind energy

Within this global effort, the wind industry is a key partner for governments, and is ready to make an important and long-lasting contribution to economic recovery. -Wind energy has been a source of massive capital investment, as one of the fastest growing new industrial sectors in the world. From 2015 to 2019 alone, wind energy generated over $652bn in investments. Ramping up installed wind capacity to above 2TW of capacity by 2030 would create additional annual investment of $207bn or over $2tn. The wind industry will also continue to be a major driver of innovation and investment in R&D as the industry introduces the next generation of wind energy turbine platforms.


-Wind energy has been a major creator of skilled jobs and community benefits, and international agencies estimate that direct and indirect jobs in wind energy will more than triple from 1.2mn in 2018 to nearly 4mn globally by 2030 if deployment takes place at the necessary rate. -The wind industry is part of a vital push to renew the world’s energy infrastructure. Creating sufficient clean generation capacity, a flexible power grid that is ready for zero-carbon renewable energy and sufficient ports infrastructure for offshore wind are fundamental building blocks for wider economic recovery. With the expected availability of low-cost finance via stimulus packages, the coming years will be vital for creating the infrastructure of the future. -Wind energy is at the heart of the energy transition, a necessary shift to a sustainable future for our society and its people. Before COVID-19, the global community had started to make strong progress on implementing the Paris Accord to prevent damaging and

irreversible climate change. The pandemic has created a temporary reduction in carbon emissions, but experience shows that these will quickly bounce back and it is vital that we redouble efforts to fix climate change for good. Wind energy is competitive around the world. We are not asking for a bail-out, but we do need a level playing field. It is vital that governments focus public funding on assets and infrastructure that will facilitate and accelerate our transition to a low carbon future. As oil prices continue to drop below historic lows, we strongly encourage Governments to introduce meaningful carbon pricing mechanisms to fund the transition to a better built future. Revenues from properly priced carbon instruments can provide Governments with the funding to develop the fully sustainable infrastructure of the future. At the same time power markets have been hit hard by the COVID-19 crisis and the massive reduction of demand. Governments must take measures to stimulate demand by moving decisively 35

to electrify the economy, including key sectors such as transport, heating and industry, as well as continue to retire ageing fossil fuel capacity in order to create rational and competitive prices. Young people in particular will bear the financial, social, health and environmental costs of the stimulus plans now being designed, and carry the debt associated with this spending, so we must make sure that they are able to benefit from today’s decisions. The International Renewable Energy Agency (IRENA) estimates that each (USD) dollar spent to advance the global energy transition will bring a return of three to eight dollars – hence the investment will pay for itself, if done right.

The necessary actions

GWEC calls on governments, intergovernmental bodies, and global lending institutions, to put wind energy investment, at the centre of their economic recovery and growth plans by taking the following actions: 1. Investment for a sustainable and resilient future


-Introduce meaningful carbon pricing on an international basis and promote a level playing field across energy sources to allow the accelerated deployment of renewables and electrification of sectors such as transport, heating and cooling and industry. -Ensure that adequate investment flows towards critical infrastructure, including power systems and grid infrastructure, at a low cost of finance and with adherence to sustainability standards. -Provide strong support for innovation and R&D programs in order to allow the accelerated deployment of the next generation of wind turbine platforms. -Introduce clear criteria that investment schemes for public and private bodies are built upon the principle of “No Harm� for society and the environment. -Implement evidence-based decisionmaking for government-backed investment, guided by metrics such as impact on GDP, environmental impact, resource depletion, social value and system resilience. -Safeguard institutional and multilateral lending and relief funds by instituting reporting requirements for sustainability and climate-related disclosures, in line with the recommendations of the Task Force on Climate-related Financial Disclosures.

-Move swiftly to scale up green financing for emerging markets and developing economies, which are facing accelerated capital flight and growing debt that hinders their clean energy transition. 2. An Enabling Environment for clean energy -Implement regulation that is fit for purpose, including market design that provides long term price visibility and streamlined permitting that enables rapid ramp up of deployment. -Safeguard existing and awarded wind projects, avoid retroactive changes to approved remuneration schemes, and secure continuation of planned clean energy auctions. -Create adequate frameworks to allow extensive and efficient repowering of older wind power plants. -Enable and promote end-consumer 100% renewable energy demand in order to allow corporates to ramp up and meet their sustainability objectives. Remove regulatory barriers where these exist in order to enable corporates to freely purchase renewable energy. -Dis-incentivise investment in polluting, expensive and aging fossil fuel assets by introducing pricing mechanisms which reflect the true economic, social, environmental and health costs of fossil fuel generation and completely phase36

out of fossil-fuel subsidies. -Accelerate net-zero commitments, carbon budgets, carbon pricing, and sciencebased approaches among government bodies and corporates as they announce their economic recovery plans. -Increase ambitions to decarbonise all economic sectors through electrification. -Reject proposals to dilute or recall legislation for environmental protection. 3. Empowerment of people to drive the energy transition forward -Capitalise on the enormous potential for the wind energy industry to create direct and indirect jobs by prioritising renewable energy for investment. -Re-skill workers who may be dislocated from sectors with a declining business case for employment in a growing sector like offshore wind. -Commit to a just and inclusive energy transition by ensuring that recovery plans focus on equitable distribution of resources, training and skills development across genders, minority groups and marginalised communities. -Maintain health and safety as a core pillar of wind energy and workforce planning.


Electricity Source: Forbes

11

HOW THE UK ENERGY MARKET WORKS From that first cuppa in the morning to our favourite late-night TV shows, we’re dependent on the UK’s energy network to power our lives.

Here we explain how it is structured, how it operates, what your rights are as an energy consumer, and what you need to know when shopping around for the best deals on gas and electricity.

How does the UK energy market work? There are three key elements that ensure you have gas and electricity at the flick of a switch or the push of a button: Electricity generation Historically, the UK has generated most of its electricity by burning fossil fuels such as coal and gas, but increasingly we’re using renewable energy sources such as wind and solar as well as nuclear power and imports from other countries Transporting energy through the distribution networks Once electricity is generated, it is transported around the country through a grid which manages supply and demand from homes, businesses and other users, such as schools and hospitals. Gas has a national distribution network similar. 37

Selling energy to consumers As consumers we get our gas and electricity from suppliers who buy energy in the wholesale market and then sell it on to us. You can choose your supplier and it’s easy to switch between them if you find a better deal.

What’s the National Grid?

The National Grid is the system operator for Great Britain’s electricity and gas supplies. It operates the networks that carries energy around the country, managing supply and demand so that users have a safe and reliable supply of energy. The grid is built around two networks – transmission and distribution. Transmission networks are like energy motorways – transporting it long distances at high voltage or volume to match demand. Then, just like the road system, energy is switched to the distribution network, which takes it on a more local journey, at a lower voltage or volume, into homes and businesses.


Energy suppliers

There are around 60 energy suppliers in the UK. Of these, the market is dominated by the so-called Big Six: • C entrica (owner of British Gas, quoted on the London stock market) • E DF Energy (owned by French stateowned energy firm EDF) • E .ON (owned by German energy firm E.ON SE) • n Power (ultimately owned by German energy firm RWF) • OV O (a privately-owned firm which bought SSE’s domestic energy business last year) • Scot tish Power (owned by Spanish energy firm Iberdrola). Although the Big Six supply more than three quarters of the country’s energy, the smaller suppliers shouldn’t be overlooked. With slimmer overheads, they can perform well on customer service and the provision of ‘green’ energy and often have the best deals.

What is green energy?

If you have a green energy tariff, it

means your supplier buys energy that has been produced using environmentally-friendly means such as wind and solar power. You get the same gas and electricity as everyone else, but at least you know you’re responsible for increasing the amount of green energy being fed into the grid.

What affects the price I pay for energy? How much you pay for gas and electricity is determined by a number of factors. Wholesale energy prices account for around a third of the average electricity bill, according to Energy UK, with these prices dependent on factors such as the cost of generating electricity and supply and demand. As suppliers buy in advance, some of the volatility can be smoothed out. The price will also be affected by operating costs such as transport and maintenance, taxes and government policies (such as environmental levies) 38

and good old-fashioned competition. Where you live also makes a difference, with the charges levied by local distribution networks and the amount of energy a supplier buys and sells in a region affecting how much it charges.

What types of tariff are there?

The main types of tariff are variable rate (where the price you pay for each unit of energy you use can go up or down) and fixed rate (where the price per unit is fixed for a stated period, usually 12 months). Fixed rate, fixed term tariffs tend to be cheaper than their variable rate counterparts. If you’ve never switched supplier, or haven’t switched for a few years, you’re almost certainly on a variable (sometimes known as ‘default’) tariff. You can also get green tariffs, which promote enviromentally-friendly energy production.

Role of Ofgem

The government regulator for electricity


and gas in Great Britain is Ofgem – or the Office of Gas and Electricity Markets to give it its full name. Its responsibilities include licensing all energy companies, protecting consumers, enabling competition and innovation, and delivering many of the government’s environmental and social support programmes. Protecting consumers, especially the vulnerable, is a key part of Ofgem’s remit. It seeks to stamp out sharp practice and has the power to impose fines and enforcement orders on suppliers where they’ve breached the rules. It’s also responsible for setting the typical domestic consumption values and the energy price caps, which help to create transparency and prevent overcharging. More on those later.

What happens if my supplier goes bust? In recent years a number of smaller energy providers have gone out of business, but there is a safety net in place to protect consumers.

If your energy supplier goes bust, it’s Ofgem’s job to make sure you’re not left in the dark. It’ll ensure there’s no disruption or interruption to your supply by moving you to a new, competitive supplier.

The fact all suppliers use the same figures means you can compare the various tariffs on offer, but Ofgem recommends using your actual consumption whenever possible when comparing deals.

Any outstanding credit, or debt, on your account will be taken care of by your new supplier, and all Ofgem asks is you take a meter reading when you find out your original supplier has folded.

You can find this information on a recent bill, but if you don’t have it, you’ll be given an estimate based on the size and type of your home and how many people live there.

Once you have been moved over to the new supplier, you are free to switch to another firm if you find a more competitive deal.

Energy price caps are designed to protect consumers by limiting the amount a supplier can charge for a kilowatt hour of electricity or gas.

What are the typical domestic consumption values?

How do energy price caps work?

Energy tariffs are advertised with prices, but those costs do not reflect what most people pay since everyone’s energy consumption differs.

They were first introduced on prepayment meter energy tariffs in 2017, before being rolled out to standard variable and default tariffs at the beginning of 2019, when they saved consumers an average of £76 a year.

The energy suppliers actually use average use figures from Ofgem, which calculates how much energy a typical household uses, based on data from the previous two years.

The caps are set twice a year – April and October – to reflect the estimated cost of supplying energy over the next six-month period. In April 2020 the cap was set at £1,127 for the annual default

39


Smart meters send usage information direct from your home to the supplier, which means no more estimated bills. All homes and businesses are to be offered smart meters (one each for gas and electricity) by 2024, although the timetable may be adjusted in light of the coronavirus lockdown

tariff for a typical dual fuel customer. For prepayment tariffs the cap is ÂŁ1,164. Capping prices in this way is only intended as a temporary measure to keep a lid on energy prices. Ofgem is looking to longer-term measures such as smart metering to create a fairer market. Smart meters send usage information direct from your home to the supplier, which means no more estimated bills. All homes and businesses are to be offered smart meters (one each for gas and electricity) by 2024, although the timetable may be adjusted in light of the coronavirus lockdown.

There are a few ways to switch. As well as using a price comparison site you could ask your supplier for a better deal or look out for offers in your local supermarket or shopping centre. Switching is popular. Around 500,000 people switch each month and it only takes around five minutes to start saving on your energy bills.

Switching guarantee

Switching is easy but nearly 11 million people have never switched. The Energy Switch Guarantee aims to encourage more switching by increasing consumer confidence in shopping around for a better deal.

It’s also important to note that there aren’t any price caps on fixed term energy tariffs as these deals are more likely to represent good value for money.

Introduced in 2016 and backed by the government, it sets out the standards energy suppliers must follow when switching a customer.

Switch for better value

What standards can I expect?

Although energy price caps are designed to stamp out overcharging, the easiest way to save money on your energy bills is to shop around. Switching your tariff or supplier is simple and can save the average household a couple of hundred pounds a year. 40

Under the guarantee, your new supplier will handle the switch, making sure the process is reliable, hassle-free and completed within 21 days. You also get a 14-day cooling off period


if you do change your mind, plus the reassurance that any credit with your old supplier will be refunded within 14 days of your final bill. As the guarantee is voluntary, not every energy company has signed up. However, it does cover around 90% of the market, including the Big Six.

What if something goes wrong? If a switch goes wrong, you can get financial compensation, even if the supplier hasn’t signed up to the Energy Switch Guarantee.

You’ll automatically get compensation if: • you ’re switched and you didn’t request it; • a switch takes more than 15 working days • it takes longer than six weeks from a switch to receive a final bill • a former supplier takes more than 14 days to refund a credit balance. Compensation is set at £30 – although you might receive it from both suppliers in the event of an erroneous switch – and should be paid automatically.

How does the industry deal with complaints?

Whether the problem involves a switch, your supply or the way you’ve been sold energy, if you’ve got a complaint, you can turn to the Energy Ombudsman. As part of Ombudsman Services, and approved by Ofgem, it has helped resolve more than 90,000 complaints over the last 12 years. The complaints process is simple. If you’ve tried to resolve a problem with your supplier and you’re not satisfied, you can go to the ombudsman. Providing your supplier is signed up to their scheme – and most are – it will assess your complaint, looking at both sides of the story and any relevant regulation. If you accept the resolution it recommends, it becomes legally binding and the supplier must comply with it.

schemes are available to help with your energy bills. These include: • C old weather payment – if you’re receiving benefits, you could be entitled to £25 for every seven-day period when the average temperature is below zero degrees celsius in your area between 1 November and 31 March. • W inter fuel payment – if you were born before 5 October 1954, you can get between £100 and £300 to help with your winter heating bills. • Warm home discount – a discount of £140 on your electricity bill is available between September and March if you receive the guarantee credit element of pension credit or you’re on a low income. Grants are also available if you’re looking to make your home more energy-efficient. Different schemes are available around the country and can help pay for things like loft and cavity wall insulation. More information can be found through the government’s Simple Energy Advice service.

Is there any financial help available for consumers? A number of government support 41

Source: Forbes


Overview

12

EUROPE’S ENERGY SYSTEM INTEGRATION “Sector coupling” is the new energy buzzword in town. In essence, it means bringing energy supply closer to large consuming sectors such as transport, buildings and industry in search of more renewables, greater efficiency, and lower carbon emissions.

With its European Green Deal, tabled in December 2019, the Europe Commission has set out a wide range of policy initiatives to make Europe climateneutral by 2050. Among those is “the smart integration of renewables, energy efficiency and other sustainable solutions across sectors” which, according to the Green Deal, “will help to achieve decarbonisation at the lowest possible cost”. The notion of “energy system integration” is mentioned only once in the Green Deal. But the concept has already reached buzzword-status and is often used interchangeably with other expressions such as “smart sector integration” or “sector coupling”. Put simply, it means bringing together the electricity and gas sectors on the energy supply side and linking them with major energy consuming sectors on the demand side – such as transport, buildings, households, industry and agriculture. These sectors currently operate in silos 42

and continue to rely chiefly on fossil fuels, which are responsible for the bulk of human-made global warming emissions. Linking them all together in a “hybrid” energy system combining gas and electricity is part of the latest thinking in Brussels to extract deep emissions cuts from transport, buildings and industry, which are considered “hard-to-abate” because they cannot easily be electrified.

The strategy

The EU’s sector integration strategy will be developed chiefly by Kadri Simson, the EU’s energy commissioner. “To speed up the deployment of clean energy across the economy, (…) you should look at how to facilitate the smart integration of the electricity, heating, transport and industry sectors,” Commission President Ursula von der Leyen wrote in Simson’s mission letter. The commissioner swiftly responded to that call. “By June 2020, I will present a strategy for smart sector integration which will promote stronger integration


of the electricity, heating and cooling, transport, gas, industry, and agricultural sectors – making it easier and more efficient to incorporate renewables into all parts of the energy sector,” Simson said in her opening speech at the European Parliament. The Commission further raised expectations by linking the sector integration strategy to the development of hydrogen, another energy buzzword. “I see a pivotal role for hydrogen” said Frans Timmermans, the Commission vice-president in charge of the Green Deal, in a speech on 21 November. Hydrogen will be “an enabler of sector integration,” added the Commission’s Director-General for Energy, Ditte Juul Jorgensen, during a speech at the same forum. Commissioner Simson later confirmed that hydrogen will be a “central element” of the Strategy for Energy System Integration, while other renewable and low-carbon gases, electrification, storage and digitalisation, will play important roles as well.

The meaning

The initial term ‘sector coupling’ seemed to imply a binary coupling of the gas and electricity grids. BloombergNEF, a research firm, says it can be boiled down to electrification – direct and indirect: • D irect involves rolling out electric vehicles in transport, and spreading electric heating systems like heat pumps in buildings and some parts of industry. • Indirect involves a switch to ‘green hydrogen’ produced by electrolysis using renewable electricity as a fuel to provide heat for buildings and industrial processes. But several industry players see coupling more broadly, as a way to integrate energy supply with the main sectors on the demand-side, i.e.: transport, heating, buildings, industry and agriculture. When announcing the strategy, Simson herself referred to “electricity, heating and cooling, transport, gas, industry, and agricultural sectors”, which includes both the energy production and use sectors as well as the transmission grids lying in between. 43

The terms ‘sector integration’ or ‘energy system integration’ arguably better represent this broader scope.

Synergies for decarbonisation

Put simply, sector integration boils down to one word: synergy. The idea is that integrated sectors can use each other’s strengths (e.g. the scale at which electricity can be produced renewably, the portability of non-electric energy carriers, the storage capacity of the gas grid, or the aggregation of demand in district heating systems) and minimise energy waste (e.g. by using waste heat from data centres, or avoiding curtailment of renewable electricity). That way, the efficiency of the system as a whole is optimised and decarbonisations is achieved “at the lowest possible cost”, as the Green Deal puts it. In its public consultation on the strategy, the European Commission listed three main synergies of smart sector integration:


• Direct electrification of sectors that currently still rely on fossil fuels, to increase the use of renewable and lowcarbon electricity – for example through the use of electric vehicles in transport, or of heat pumps for space heating in buildings. • Renewable and decarbonised gases and fuels to replace fossil ones, especially in hard-to-decarbonise sectors such as air transport and heavy industrial processes. Such fuels include hydrogen produced from renewable electricity (also called indirect electrification), and biomethane produced from agricultural wastes. A more “circular” energy system, to increase the overall efficiency of the energy system – for example the use of industrial waste heat or waste heat from data centers to heat buildings, for instance through a district heating network.

Electrification

In its simplest form, direct electrification means using electricity for purposes that were previously fuelled by other energy carriers – using electric vehicles instead of fossil-fuelled ones for instance. However, using electricity is can be difficult or inefficient, for instance in certain industrial processes that require very high temperatures, or in heavy-duty transport where the heavy weight and limited range of batteries are dealbreakers. In those cases, “indirect electrification” is an option, in which electricity is

converted into another form of energy first – for instance hydrogen – through a process called water electrolysis.

“Decarbonised” gases obtained from fossil fuels using Carbon Capture and Storage, i.e.: “blue” hydrogen.

The benefit is that this way, renewable electricity can be used to produce molecular energy carriers. These can be combusted or used in combination with fuel cells as a lighter alternative to batteries to drive electric processes.

Efficiency

Indirect electrification can also help to replace non-energy demand for fossil fuels. Examples include industries such as steelmaking and fertilisers, where hydrocarbons such as fossil gas are used as a feedstock – not for the energy they contain, but for the molecule that they are. The major downside of converting electricity into hydrogen is that every conversion step carries losses. Indirect electrification is therefore by definition less energy efficient than direct electrification.

Apart from supporting the uptake of renewables in the energy system, the other major promise of sector integration is to save energy in absolute terms. One way of doing this is to use waste heat in one sector as a supply source for another, for example through district heating systems. Heat that is released by data centres, supermarkets or industry can for instance be used to heat houses that are connected to a district heating system. Another way in which sector integration can avoid “wasting” energy, is by avoiding curtailment of renewables – the deliberate curbing of renewable energy generation when supply exceeds demand.

Still, this option makes sense in cases where carrying batteries or directly using electricity are simply not feasible – for example in aviation.

Integrated sectors can for instance facilitate demand response or grant access to storage capacity of one sector to another, thereby making more use of existing infrastructure, such as home or car batteries and the gas system.

But indirect electrification is just one pathway to produce renewable and decarbonised gases. The two other pathways are:

The latter is thought to be especially important for seasonal variances, where batteries or demand response provide no real alternative to molecular energy storage.

Biomethane produced from agricultural wastes, which is explicitly mentioned in the Commission’s public consultation on the strategy.

The role of hydrogen

44

There are some key enablers of energy system integration, the first being hydrogen.


In its simplest form, direct electrification means using electricity for purposes that were previously fuelled by other energy carriers – using electric vehicles instead of fossil-fuelled ones for instance

“Hydrogen is maybe not the silver bullet, but might be the missing link,” Said Tudor Constantinescu, principal advisor of the Directorate-General for Energy. As explained above, hydrogen, as a gas that can be produced from renewable electricity, can facilitate this exchange of energy between different sectors. “Hydrogen, if produced through electrolysis of water using renewable energy, can provide flexibility as a storage medium while reaching hard to abate sectors as an energy carrier or feedstock,” Constantinescu wrote in an opinion piece on the molecule. It is important to realise that hydrogen is not an energy source, but an energy carrier that can be produced from different energy sources, using a variety of production pathways. Whether or not hydrogen is a clean energy carrier depends on two main aspects of the production process: the energy used to complete the process, and the “by-products” that this process creates (e.g. oxygen or carbon dioxide) 45

as well as how they are dealt with (with or without carbon capture and storage). When hydrogen is produced from 100% renewable energy, for instance through water electrolysis using renewable electricity (i.e. indirect electrification), it is labelled “green”. “Grey” hydrogen is the exact same molecule, but was produced from fossil fuels in a reaction that produces CO2 as well. Hydrogen is called “blue” if it is produced from fossil fuels without releasing CO2 in the atmosphere, for instance thanks to Carbon Capture and Storage (CCS) technology, or by using production processes that produce solid carbon instead of CO2 as a by-product. Although not renewable, blue hydrogen can provide the same flexibility and stability services as their renewable equivalents, and help decarbonise sectors that are hard to electrify. However, processes to capture carbon also require energy, which increases


costs and diminishes overall efficiency. Besides, the captured CO2 also needs to be safely transported and stored, which adds to costs and further reduces efficiency. Blue hydrogen production processes furthermore do not address the risk of methane leakages during natural gas extraction. Still, both blue and green hydrogen may be referred to as “clean”. By far the largest share of hydrogen today, is produced from natural gas through a process called Steam Methane Reforming (SMR). Electrolysis accounts for about 2% of global hydrogen production.

Hybrid energy grids

That view is endorsed by the Dutch grid operators TenneT and Gasunie, which released two studies on the integrated planning of gas and electricity infrastructure. “If we want to cope with the increasing fluctuations in the energy network, we must seamlessly coordinate our gas and electricity infrastructures,” Said Han Fennema, CEO of Gasunie, the Dutch gas grid operator, in a comment to the studies. “By linking the networks of TenneT and Gasunie, we can provide the required flexibility for the energy system and also keep the system reliable and affordable.” he explained.

An integrated energy system implies a decentralised grid where energy flows freely between consumers, producers and storage solutions. That requires “reverse flows” of energy running from distribution to transmission levels.

But national grid integration is not sufficient to achieve climate objectives, said Manon van Beek, CEO of TenneT, the Dutch electricity TSO. “This cannot be done without an integrated European energy system,” she said in a statement.

And that means connecting the electricity and gas networks in a hybrid system.

Efficient buildings

“Combining the electricity and gas infrastructure – for us in the Commission it’s clear that it’s the way to go,” said Klaus-Dieter Borchardt, deputy director general in the Commission’s energy department. “A hybrid system based on two pillars, in our view, is more resilient and would really add to security of supply,” he explained, citing the “storage capacity” of the gas grid as an added value to a system.

supply centres, home batteries and heat pumps also provide flexibility to the grid by helping consumers manage their energy demand. Meanwhile, neighborhoods that are connected to district heating systems use otherwise wasted heat streams, boosting the overall efficiency of the system – especially during winter time. The uptake of such technologies could be accelerated by taking an integrated approach to building renovation. In addition to passive insulation, building renovation programs could focus on installing home batteries, solar panels and smart meters, some argue.

Digitalisation

The physical installation of storage, production, transmission and metering infrastructure is only half the story. System optimisation will also require continuous monitoring and control of these technologies and their interactions.

An integrated energy system also has a local dimension, with buildings playing a key role on the side of energy end-users.

That requires “making gains on digitalisation,” said EU energy Commissioner Kadri Simson.

As consumers start switching massively to electric vehicles, homes are increasingly becoming like small energy supply and demand units, providing both a charging point for refueling and bringing added flexibility to the grid by discharging back to the grid during peak hours.

Digital solutions could for instance support demand response, or unlock the potential storage capacity of millions of distributed home and car batteries.

While rooftop solar panels are turning our homes into decentralised energy 46

Accurate real-time insights and projections of renewable generation and energy demand could benefit owners of electrolysers, batteries and other storage and flexibility solutions.


And at a systems level, smart control centres could “optimise” the operation of the entire system, by calculating which form of energy is most valuable where at each moment in time. As BloombergNEF puts it, the success of sector coupling will depend on the uptake of new sources of demand-side flexibility, such as “dynamic” electric vehicles that recharge their batteries when demand for power is lowest, and other “smart” heating systems or household equipment that can respond automatically to pricing signals.

The challenge of regulation

An integrated European energy system will have to deal with differences in national regulatory systems. Some countries may for instance adopt targets to mix hydrogen in their gas grids, while others might not. While EU regulators accept national differences – because of different climate or legacy infrastructure, for instance – these discrepancies also create new challenges to interconnectivity on a European scale.

Specific challenges also emerge from the ambiguous roles of new components such as electrolysers and storage providers. Since those can be net producers of energy at certain times and net consumers at others, they are at risk of being disadvantaged by having to pay taxes twice. The Commission is also considering looser state aid rules for hydrogen projects, by labelling them Important Projects of Common European Interest (IPCEI). The IPCEI framework allows state funding for large-scale, crossborder industrial projects deemed crucial for the future of European industry. The most well-known is an IPCEI on batteries.

The cost

At the end of the day, falling technology costs will be a major driver in guiding the choices of market participants as well as politicians – much like they did with wind and solar power. BloombergNEF, for instance, points to rapidly falling cost of electrolysers as something that could quickly change the market dynamics for clean hydrogen production. 47

The Commission, for its part, believes that energy system integration “is necessary if we want to achieve a deep but also cost-effective decarbonisation of our economies”. But what do the numbers say? A 2018 study funded by the Commission found that the average annual cost of an integrated energy system was €85 billion lower than in a “basic decarbonisation scenario” between 2030 and 2050. “The lower cost is achieved thanks to the introduction of hydrogen as an intermediate fuel and its particular role in transport,” the study states. According to a study by Aalborg University commissioned by Danish engineering firm Danfoss, savings will primarily result from reduced fuel usage. “Investments in efficiency measures across the energy value chain will decrease fuel consumption and operation and maintenance costs, more than offsetting the increases in investments,” the study states.


Oil and gas

13

H2

THE TRANSITION TO HYDROGEN TECHNOLOGY

The cost of hydrogen is expected to drop sharply and imminently. Hydrogen technologies could provide 20% of the world’s CO2 abatement needs by 2050. Now it’s up to policy-makers and investors to jump start this transition.

Could 2020 mark a major turning point for the global clean energy transition – with hydrogen at its core? Is this the beginning of a new decade in which governments, industry and investors shift gears together and move more rapidly towards scaling up hydrogen-based solutions for cleaner transport, heating, and industry? On the third anniversary of the Hydrogen Council’s launch at Davos in January 2017, the stars seem to be aligning to make this happen. According to new data from three global agencies, NASA, NOAA and the UK Met Office, the 10 years to 2019 were the warmest on record, and this comes after the IPCC’s warning of the expected impacts of 1.5°C of global warming. In the future, we may look back at this past decade as being the one that fully recognised the climate challenge - while the next decade, starting now, offers an opportunity to address it. So while these global organizations have been working to gather data, we – the hydrogen industry – have been working hard to identify solutions to help tackle the issue. Today, we have the opportunity to tap 48

into the enormous potential of hydrogen for a range of applications, from fuelling passenger cars and heavy-duty trucks to heating buildings and powering industry. It can help us decarbonize hard-to-abate sectors such as heavy transport, steel and aviation; and, most importantly, it generates zero emissions at the point of use, can be produced from renewables such as solar and wind, and provides a solution in instances of excess electricity production, as it allows for long-term energy storage. In fact, if we focus on scaling up in the next decade, hydrogen could meet 18% of the world’s final energy demands by 2050 and provide roughly 20% of the CO2 abatement required to limit global warming.

Hydrogen cost will fall sharply

Until now, the biggest challenge for hydrogen energy has been its price tag. The costs associated with hydrogen for everyday use has put it out of reach compared to other options, but this is about to change. A new report entitled Path to Hydrogen Competitiveness: A Cost Perspective, launched by the Hydrogen Council – a CEO-led coalition of now more than 80 companies working to bring the


benefits of hydrogen to the world – shows that by massively scaling up hydrogen production, distribution, equipment and component manufacturing, the cost of hydrogen solutions is projected to decrease by up to 50% by 2030 in a wide range of applications, making hydrogen competitive with other low-carbon alternatives and, in some cases, even conventional options. Significant cost reductions are expected across different hydrogen solutions. For more than 20 of them, such as longdistance and heavy-duty transportation, industrial heating, and heavy-industry feedstock, which together comprise roughly 15% of global energy consumption, the hydrogen route appears the decarbonization option of choice – a material opportunity. This cost trajectory can be attributed mainly to scale-up that positively impacts the three main cost drivers: – A significant fall in the cost of producing low-carbon and renewable hydrogen. – Lower distribution and refuelling costs thanks to higher load utilisation and scale effect on infrastructure utilisation. – A dramatic drop in the cost of components for end-use equipment from scaling up of manufacturing. The report debunks the myth that a

hydrogen economy is unattainable and demonstrates that the possibility of a clean energy future in which hydrogen plays a major role may well be closer than we think.

Investing in hydrogen now

To deliver on this opportunity, policymakers need to help create the right market conditions. Governments in key geographies will need to put in place supporting policies, and investment support of around $70 billion will be needed from various sources over the next decade in order to scale up and achieve hydrogen cost-competitiveness. While this figure is sizeable, it accounts for less than 5% of annual global spending on energy. For comparison, global yearly spending on energy amounts to $1.85 trillion, while subsidies provided to renewables in Germany totalled roughly $30 billion in 2019 alone. The momentum in the hydrogen sector is strong. Deployments, strategies, alliances and technology developments are progressing in wider geographies and sectors. Still, some key highpotential projects are yet to take off. Similarly, while some measures and supporting financing tools are in place, many of them are lacking in terms 49

of scope and impact to firmly bring the sector to scale. In the last year, the industry has been establishing partnerships with a clear commitment to scale up. Through the Hydrogen Council, we have – for example – partnered with the European Investment Bank to identify the right innovative financing schemes, hosted industry leaders and members of the investment community at an Investor Day at the G20 Summit in Japan, and brought investors onboard with a new Investor Group – all steps in defining and implementing how to accelerate major investment in large-scale commercialisation of hydrogen solutions across industries worldwide. 2020 could indeed mark the beginning of a new era for clean energy. If we step up investments in hydrogen technologies and succeed in developing the right policy framework to turn hydrogen into a major part of our global energy system, hydrogen can help us lower our emissions while significantly improving energy security and resilience. If we are to collectively reach our global climate goals and reap the economic and environmental benefits of hydrogen, now is the time to act.


Environment

14

OPPORTUNITIES IN THE NATIONAL ENERGY PLANS A new report is published by Climate Action Network (CAN) Europe and ZERO, with the contribution of environmental NGOs and think tanks across Europe, examining climate ambition and the role of the National Energy and Climate Plans (NECPs).

The report titled “PAVE THE WAY FOR INCREASED CLIMATE AMBITION: Opportunities and gaps in the final National Energy and Climate Plans” assesses the final NECPs of 15 Member States, submitted in December 2019. Among the Member States studied in the report, only Greece, Denmark, Slovakia, Slovenia and Spain increased their national climate targets for 2030. But only Denmark with its new goal of reducing greenhouse gas emissions across all sectors of the economy by 70% in 2030 compared to 1990, is compatible with the Paris Agreement. As the EU goal of reducing greenhouse gas emissions is expected to be revised soon from the current 40%, Member States are called upon to adopt much more ambitious climate commitments.

The goals of the Paris Agreement The report also compares the drafts with the final NECPs in terms of Member States’ contributions to the Renewable Energy Sources (RES) and energy efficiency targets. The report finds that the Member States’ contributions have slightly improved but not to the 50

levels required to achieve the long term objective of the Paris Agreement. Of the Member States that increased their RES targets, only Greece, Croatia and Estonia exceeded the European Commission’s recommendations in June 2019, setting higher RES targets for 2030, while countries such as Slovenia, Romania, Poland, Hungary and the Czechia set targets lower than the European Commission’s recommendations.

Energy consumption

Assessing energy efficiency is hard, without Germany’s NECP, which has yet to be submitted in its final form. Greece is among the countries that commit to the greatest reductions in primary and final energy consumption in relation to both the 2017 and the 2020 targets, while it also appears more ambitious compared to the draft NECP. The same applies for Slovenia and primary energy consumption. Improvements in relation to the drafts are also noted in the final NECPs of Romania, although the final energy consumption in 2030 still exceeds 2017 levels, Portugal, Latvia and Slovenia, Czechia, Estonia, Poland France, Spain,


Denmark and Hungary have virtually no improvements compared to their corresponding draft NECPs.

Fossil fuel subsidies

The report is critical of the shortcomings of the NECPs of Member States in relation to the European Commission’s recommendations on the key issue of abolishing fossil fuel subsidies. Spain, Austria, France and Slovenia recognize some such subsidies and present some measures for their gradual abolition. Greece and Hungary, on the other hand, do not even acknowledge the existence of such subsidies, while Poland not only has no plans to abolish them, but mentions that subsidies to the lignite and coal industry will continue.

Decarbonisation

The report also assesses the Member States’ commitment to a lignite and coal phase out, a field in which Greece, Hungary and Slovakia have made significant progress with their commitments to full phase out by 2028, 2030 and 2023, respectively. However, the fact that in Greece the energy, which, according to the draft

NECP would come from lignite by 2030, is to be covered primarily by fossil gas and not by RES in the final NECP, is characterized as negative. Wendel Trio, Director of Climate Action Network (CAN) Europe said: “National Energy and Climate Plans have the potential to prepare the ground for increased climate ambition in Europe and direct investments in the next 10 years for a just and climate neutral recovery to tackle both the climate and economic crises. The opportunities underlined in this report should serve as A guidance for Member States on where to put their money to achieve climate neutrality and stimulate the economy.” “Following the important decision to completely phase out lignite, Greece must avoid a dangerous lock in of its energy future in fossil fuels. The front-bearing development of RES and storage infrastructure combined with energy efficiency constitute the only long-term sustainable energy strategy for the country. The generous EU 51

recovery package offers Greece a unique opportunity to implement the necessary investments for the climate, the national economy and quality of life of the citizens,” commented Nikos Mantzaris, Senior Policy Analyst of the Green Tank.


Renewables

15

DANUBER ENERGY+: 8 PROJECTS IN THE NEXT PHASE As part of the European preacceleration program Danube Energy+, Transylvania Startup Center Association organized a pitching session for the eight pre-selected teams.

Danube Energy+ targets young people under 35 from Romania, with innovative ideas in the green energy field, who are supported to turn their projects into sustainable businesses. Before the pitching session, the teams benefited from two intensive weeks of training, conducted online, which included business mentoring sessions, with a focus on developing a business model, sales and pitching.

Gabriel Apahidean want to develop an electronic waste recycling factory, coupled with a consumer application through which, using gamification methods, to increase the recycling level of this type of waste;

The 8 projects

• EVOLTA: project carried out by Teodor Tiber and Iulian Susan who aim to develop the first network of fast charge stations for electric cars in Galati and Braila; • FE RMIERUL 4.0: Alexandru Luchian builds a mobile aquaponics selfsustaining system for the HoReCa industry. Using this system, restaurants will be able to grow fresh food on their own, throughout the year, in a sustainable way: fresh-water fish (in pools created within the restaurants’ premises) and fresh greens in a hydrobed system. For low energy consumption, solar panels can be added;

The Romanian projects from Danube Energy+ program are: • BILLIT: digital shopping voucher. Oana Durcau and four other students have developed an application via which any receipt received can be virtually stored for good management of expenses and for potential returns of products, in case the printed receipt is lost. The team aims to completely eliminate printed receipts, which involve an additional cost for retailers and is a non-recyclable waste for the consumer; • E COCYCLING: Razvan Capota and 52

HYDROGEN PVC: a home heating system, developed by Ionut Procop, which uses hydrogen to decarbonize the electricity grid. He proposes an integrated system, using electrical


panels for the energy needed in the electrolysis of water, with the help of which consumers can have complete autonomy for their energy needs, regardless of the type of weather, at low costs; • SL ICK: the prototype for an electric motorcycle with an electric engine for each wheel. It is developed by Ionel Chereja, a high school student who aims to turn his idea into a serial product; • SOL AR CHAIR is a social project developed by Luminita Vlaicu that is building a wheelchair for people with disabilities, set in motion with the help of solar energy. The young woman focuses on finding solutions so that this product can be developed at the lowest possible costs in order to be accessible to potential beneficiaries; • T APOHUB: Adrian Pop and his team are in the testing phase, at the National Institute of Aerospace Research, of a new model of wind energy generator, of small dimensions. It was designed to be used mainly in agriculture, in order to reduce energy consumption in crop

irrigation. The solution can also have residential use;

The energy program

Danube Energy+ is a project that takes place in nine European countries (Bulgaria, Czech Republic, Croatia, Germany, Romania, Serbia, Slovakia, Slovenia, Ukraine) and targets any enthusiast up to 35 years old with ideas to transform the energy system into a green one. Solutions target areas such as energy storage, smart grids, energy for transport and mobility, smart cities and buildings, energy efficiency, renewable energy or integrated into the circular economy. The 3-years project aims to accelerate the development of innovative startups in the region that will contribute to sustainable transformers of the energy system. In each of the nine countries, there were selected program partners, in order to create a system of learning and cooperation between regional public administrations, universities, SMEs and energy companies. A set of good practices, business models and case studies from the region will stand at the 53

basis of the learning scheme of the preacceleration program for young people admitted to the program. At regional level, 90 young energy innovators will be selected (individually or as teams). The Transylvania Startup Center Association is the Danube Energy + partner in Romania. Together, with eight other European entities and seven associated strategic partners – cooperation bodies with regional public administrations, Startup Transilvania has the mission to coordinate the evolution of selected young innovators, to develop and implement the pre-acceleration program at national level, to cooperate with stakeholders in regional ecosystems to support European policies.


Environment

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DAILY GLOBAL CO2 EMISSIONS CUT THROUGH COVID Global restrictions put in place COVID-19 pandemic saw carbon dioxide emissions fall to their lowest level since 2006. The drop was highest in early April, when regions responsible for 89% of global emissions were under some form of lockdown.

The amount of CO2 being released by human activity each day fell by as much as 17% during the height of the coronavirus crisis in early April, a new study shows. This means daily emissions temporarily fell to levels last seen in 2006, the study says. In the first four months of the year, it estimates that global emissions from burning fossil fuels and cement production were cut by 1,048m tonnes of CO2 (MtCO2), or 8.6%, compared with 2019 levels. The research projects a decline of up to 2,729MtCO2 (7.5%) in 2020 as a whole, depending on how the crisis plays out. It is the first to have been through the peer-review process and is broadly in line with an early estimate for China published by Carbon Brief in February, as well as separate global estimates published last month by Carbon Brief and the International Energy Agency. Today’s study also marks the first-ever attempt to quantify CO2 emissions on a daily basis, for the world and for 69 individual countries, in close to real time. 54

Until now, annual CO2 emissions data has typically been published months or even years later. A publicly available daily estimate of global or national CO2 emissions would be “incredibly useful, particularly for motivating policy action and pressure”, another researcher tells Carbon Brief.

Coronavirus crisis

The ongoing coronavirus crisis has claimed the lives of hundreds of thousands of people around the world and seen the introduction of severe restrictions on movement in many countries. These lockdowns have included “stay at home” orders, border closures and other measures that have had direct effects on the use of energy and, consequently, on the release of CO2 emissions. As the crisis has unfolded, so too have attempts to quantify its impact on CO2 emissions. These efforts have been challenging, however, because real-time CO2 emissions data does not exist. The annual emissions inventories that


countries submit to the UN take years to compile – and even these are estimates rather than direct measurements. Greenhouse gas emissions are estimated using a variety of methods, often based on “activity data”. This might be the number of miles being driven, the amount of electricity generated or even – in the case of nitrous oxide, which is used as a propellant – via cream consumption. Today’s study, published in Nature Climate Change, combines activity data for six sectors with a “confinement index” of lockdown measures in each country or region over time. This allows for an estimate of changes in daily global CO2 emissions in JanuaryApril 2020, relative to the 100MtCO2 released on an average day in 2019. During peak confinement in individual countries, daily CO2 emissions fell by 26% on average, the paper says. However, the size of this effect is reduced at a global level, because not all countries were under the most severe type of lockdown at the same time.

At the peak of the crisis in early April, regions responsible for 89% of daily CO2 emissions were under some form of lockdown, the paper says. Daily global CO2 emissions fell to 83MtCO2 (-17%, with a range of -11 to -25%) on 7 April, equivalent to levels last seen in 2006.

the chart below according to their share of global CO2 emissions from fossil fuels and cement. These are electricity and heat (44%); industry (22%); surface transport (20%); homes (6%); public buildings and commerce (4%); and aviation (3%).

In a press release, lead author Prof Corinne Le Quéré, professor of climate change science at the University of East Anglia’s Tyndall Centre (who will be a panelist at Carbon Brief’s webinar on 21 May), says:

Notably, this split highlights the limited potential for individual actions to radically reduce global emissions, in contrast to the societal choices that govern CO2 from electricity and industry.

“Population confinement has led to drastic changes in energy use and CO2 emissions. These extreme decreases are likely to be temporary, however, as they do not reflect structural changes in the economic, transport, or energy systems.”

The split in global CO2 emissions, shown above, is then broken down further for each of 69 countries, 50 US states and 30 Chinese provinces, which account for 97% of the global total. This gives industrial CO2 emissions in Italy, for example, on an average day in 2019.

Daily data

The paper then uses 669 datasets, covering each of these sectors over time, and classified according to the level of confinement in place at each point. For example, this might be daily reports on mobility, traffic and congestion to measure “activity” for surface transport.

In order to estimate daily global CO2 emissions, the researchers use a novel approach that combines sectoral activity data with a country-by-country confinement index. The paper looks at six sectors, shown in 55


This daily data is then adjusted to remove effects unrelated to coronavirus, such as the mild northern hemisphere winter or the day of the week. Under the highest level of confinement, surface transport “activity” fell by 50% on average, the paper finds. This is shown in green in the chart, below, where each dot represents a single data point, open circles show the average and the horizontal lines show the variability between datasets. The chart also shows changes in activity for electricity, industry, homes and aviation. For electricity, the paper looks at total daily demand in Europe, the US and India, finding an average 15% reduction in demand under strict lockdown. In industry, the paper looks at daily coal use in China reported by Carbon Brief and weekly reports on steel production in the US. For homes, the paper draws on figures from UK smart meters. And for aviation – the most strongly affected sector – it uses data on domestic and international departures around the world. As the chart above shows, the analysis relies on relatively sparse information for industry, whereas activity levels in transport draw on a wider range of datasets.

Emissions estimates

The team then uses the average change in activity, for each sector and level of confinement, to build up an estimate of daily CO2 emissions around the world. For example, on days when Turkey is under the strictest lockdown, the analysis assumes that its power-sector CO2 emissions would fall by 15% compared with the average in 2019 – and those from surface transport by 50%. When Turkey shifts from “confinement index three”, the strictest controls, down to level two, its power-sector emissions would be 5% below usual levels and transport 40% lower. For each confinement level, the same percentage reductions are assumed to apply to all countries. This approach means that the team only needed to know when each country, state or province changed its coronavirus lockdown from one “confinement level” to another, as well as the daily average level of CO2 emissions from each sector in 2019. Putting all of these countries and lockdown levels together, the paper finds that the cut in daily global CO2 emissions peaked at -17% on 7 April, shown in the figure, below. Across the first four months of 2020, emissions fell by 1,048MtCO2 56

(8.6%), compared with 2019 levels. Within this global total, the largest impacts were in China, where emissions fell by an estimated 242MtCO2 in the first four months of the year, followed by the US (-207MtCO2), Europe (-123MtCO2) and India (-98MtCO2). Dr Glen Peters, research director at Norwegian climate institute Cicero and one of the study authors, tells Carbon Brief that while the approach was designed around the current crisis, the team has gathered the “raw material” to make daily CO2 estimates on an ongoing basis. He says: “We have discussed more ‘real-time’ estimates for sometime and there are many advantages. We are illustrating one advantage with our paper to see the consequences of particular policy interventions in near real time.” But Peters notes that some of the daily data they used – the urban congestion index series from satnav maker TomTom, for example – is only being made publicly available during the current crisis and might be made private again in the future. He also asks whether daily data is truly needed, or whether weekly or even monthly estimates might be sufficient for scientists and policymakers.


The lockdowns have included “stay at home” orders, border closures and other measures that have had direct effects on the release of CO2 emissions

Dr Hannah Ritchie, head of research at website Our World in Data and one of the reviewers of the new study, tells Carbon Brief: “I think daily CO2 estimates would be incredibly useful, particularly for motivating policy action and pressure… Climate change already has the classic long-termism problem, but this is exacerbated by the fact that we get a figure on CO2 emissions published once a year, as a marker of how each country is doing.” If daily CO2 estimates were publicly available for all countries, it would become possible to actively track progress, she says, adding: “You can have a counter on the news, or an app or dashboard on your phone – just like we do with other metrics like stock markets.”

Alternative analyses

Today’s research is not the first to analyse the CO2 impacts of the coronavirus crisis, although it is the first to have completed its passage through peer review. 57

Another paper, which is currently in review, also attempts to estimate daily global CO2 emissions in close to real time. This work finds the coronavirus crisis cut global emissions by -542MtCO2 below 2019 levels in the first quarter of 2020, similar to the -530MtCO2 figure from today’s paper. In mid-February, Carbon Brief published an analysis showing that emissions in China were temporarily cut by 200MtCO2 (25%) over a four-week period, during the height of the restrictions. The new study finds that the cut in Chinese emissions peaked at 24%. The current research also includes estimates of the emissions impact in 2020 as a whole, based on three scenarios for the length of lockdowns around the world. These entail CO2 emissions falling by between -4% and -8%, depending on how the crisis plays out. This range is consistent with estimates published in April by Carbon Brief (-6%) and the International Energy Agency (-8%).


Environment

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THE REAL DANGERS OF GLOBAL WARMING Global warming is on track to reach a ‘wetbulb’ level of 35°C, where humans can no longer regulate safe body temperature through sweating. With continued exposure above this threshold, people can die by overheating. Reducing carbon emissions to net-zero can avoid areas of the planet being carried further into uncharted heat territory.

The explosive growth and success of human society over the past 10,000 years has been underpinned by a distinct range of climate conditions. But the range of weather humans can encounter on Earth – the “climate envelope” – is shifting as the planet warms, and conditions entirely new to civilisation could emerge in the coming decades. Even with modern technology, this should not be taken lightly. Being able to regulate our temperature has played a key role in enabling humans to dominate the planet. Walking on two legs, without fur, and with a sweat-based cooling system, we’re well designed to beat the heat. But hot weather already limits our ability to work and stay healthy. In fact, our physiology places bounds on the level of heat and humidity we can cope with.

The “drybulb” temperature

The normal temperature you see reported on weather forecasts is called the “drybulb” temperature. Once that rises above about 35°C, the body must rely on evaporating water (mainly through sweating) to dissipate heat. The 58

“wetbulb” temperature is a measure that includes the chilling effect from evaporation on a thermometer, so it is normally much lower than the drybulb temperature. It indicates how efficiently our sweat-based cooling system can work. Once the wetbulb temperature crosses about 35°C, the air is so hot and humid that not even sweating can lower your body temperature to a safe level. With continued exposure above this threshold, death by overheating can follow. A 35°C limit may sound modest, but it isn’t. When the UK sweltered with a record drybulb temperature of 38.7°C in July 2019, the wetbulb temperature in Cambridge was no more than 24°C. Even in Karachi’s killer heatwave of 2015, the wetbulb temperature stayed below 30°C. In fact, outside a steam room, few people have encountered anything close to 35°C. It has mostly been beyond Earth’s climate envelope as human society has developed. But our recent research shows that the 35°C limit is drawing closer, leaving


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an ever-shrinking safety margin for the hottest and most humid places on Earth.

Heat beyond human tolerance

Modelling studies had already indicated that wetbulb temperatures could regularly cross 35°C if the world sails past the 2°C warming limit set out in the Paris climate agreement in 2015, with The Persian Gulf, South Asia and North China Plain on the frontline of deadly humid heat. The analysis of wetbulb temperatures from 1979-2017 did not disagree with these warnings about what may be to come. But whereas past studies had looked at relatively large regions (on the scale of major metropolitan areas), we also examined thousands of weather station records worldwide and saw that, at this more local scale, many sites were closing in much more rapidly on the 35°C limit. The frequency of punishing wetbulb temperatures (above 31°C, for example) has more than doubled worldwide since 1979, and in some of the hottest and most humid places on Earth, like the coastal United Arab Emirates, wetbulb temperatures have

already flickered past 35°C. The climate envelope is pushing into territory where our physiology cannot follow. The consequences of crossing 35°C, however brief, have perhaps been mainly symbolic so far, as residents of the hottest places are used to riding out extreme heat by sheltering in air-conditioned spaces. But relying on artificial cooling to cope with the growing heat would supercharge energy demand and leave many people dangerously exposed to power failures. It would also abandon the most vulnerable members of society and doesn’t help those who have to venture outside.

How to deal with it?

The only way to avoid being carried further and more frequently into uncharted heat territory is to reduce greenhouse gas emissions to net zero. The economic slowdown during the coronavirus pandemic is expected to slash emissions by 4-7% in 2020, bringing them close to where global emissions were in 2010. But concentrations of greenhouse gases are still rising rapidly in the atmosphere. 59

We must also adapt where possible, by encouraging simple behavioural changes (like avoiding outdoor daytime activity) and by ramping up emergency response plans when heat extremes are imminent. Such steps will help to buy time against the inexorable forward march of the Earth’s climate envelope. We hope that our research illuminates some of the challenges that may await us as global temperatures rise. The emergence of unprecedented heat and humidity – beyond what our physiology can tolerate – is just a portion of what could be in store. An even warmer and wetter world risks generating climate extremes beyond any human experience, including the potential for a whole host of “unknown unknowns”. We hope that the sense of vulnerability to surprises left by COVID-19 invigorates global commitments to reaching carbon neutrality – recognising the value in preserving conditions that are somewhat familiar, rather than risking what may be waiting in a very novel climate ahead.


Nuclear energy

Source: energydigital.com

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TOP 10 NUCLEAR PLANTS IN THE WORLD Energy Digital takes a look at the history and operations of the largest nuclear power plants in the world, ranked by energy generation capacity.

Hanbit Constructed in South Korea’s Jeollanam-do province, the Hanbit Nuclear Power Plant has six operational units ranging from 947MW to 997MW subdivided into three variants. Hanbit 1 and 2 use pressurised light water reactors (PWRs) built via South Korea’s ‘component approach’, which utilised domestic companies

for auxiliary parts and contracted international designs for primary parts. Meanwhile, Hanbit 3 and 4 were constructed using entirely domestic sources, while Hanbit 5 and 6 were inspired by Ulchin-3 reactors - a Korean Standard Nuclear Power design. Country: South Korea Capacity: 5,875MW


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Cattenom

Construction for the Cattenom plant began in 1979 in Cattenom, France. Consisting of four pressurised water reactors (PWRs), each with a power output of 1,300MW, the site uses water from the Moselle River in combination

Paluel

Placed within the French town of Paluel, Normandy, the plant provides employment to almost 1,250 people. With its capacity provided by four 1,330MW reactors, Paluel provides over 32 billion KWhs of electricity per year.

with four cooling towers. Additionally, an artificial lake was created in Pierre-Percée to provide a greater supply of coolant. Two of the plant’s units were successfully commissioned in 1986 and 1987, with the third and fourth becoming operational in 1990 and 1991

Construction of the plant began in 1977, with the first and second units being commissioned in 1985, the third in 1986 and the fourth in the summer of the same year. The reactors use water from the English Channel as a source of coolant.

respectively. The plant employs 1,200 full-time workers and supplements a further 1,000 during outages - periods where the reactors are powered down and maintenance is performed. Country: France – Capacity: 5,200MW

Country: France Capacity: 5,320MW


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Gravelines

Using water from the North Sea as coolant, the Gravelines power plant is situated 12 miles from Dunkerque. Providing employment for over 1,600 people, it is the largest nuclear power station in Western Europe and holds the record for being the first station to generate over 1,000TWhs of electricity. Owned by Electricite de France (EDF), the plant has a 5,460MW capacity derived from six 910MW reactors. The reactors were constructed in batches of two in 1980, 1981 and 1985. Country: France – Capacity: 5,460MW

Zaporizhia

Becoming the largest Eastern European nuclear power plant in 1995 following the completion of its sixth reactor, Zaporizhia is located in Enerhodar, Ukraine, on the banks of the Kakovka Reservoir. Responsible for generating approximately 20% of Ukraine’s entire electricity supply, Zaporizhia from six pressurised water reactors (PWRs). All six units were completed in a nine-year period (1984 to 1995). Following an application made by Energoatom the nuclear power company operating the plant - the first two units are currently being assessed for modernisation efforts in an effort to extend their operational lifespan. Country: Ukraine – Capacity: 5,700MW


Hanul

Containing six pressurised water reactors (PWRs), Hanul Nuclear Power Plant located in Gyeongsangbuk-do is South Korea’s second-largest. The plant began construction in 1983 and became operational in 1988. After numerous developments, the latest of which was completed in 2018, the plant has a nameplate capacity of 5,928MW. The first Korean Standard Nuclear Power (KSNP) project, Hanul’s construction was part of a plan to attain a self-sufficient source of electricity. One of the sites - Hanul 3 - was the first to employ KSNP’s tech in 1998, which introduced a depressurisation system and superior chemical, volume and digital control. Country: South Korea – Capacity: 5,928 MW

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Yangjiang

The conception for China’s largest power station started in 1988, when the site in Yangjiang, Guangdong was selected for development. Once the project received approval from the Chinese Government in 2004, construction began in 2008, with the first ACPR-1000 reactor starting in September 2013. Employing six 1,000MW units to generate power, Yangjiang Nuclear Power Plant helped reduce the region’s coal consumption by 30,900kg and cut 80,800kg of CO2 emissions. One of the units - the fifth, called Yangjiang NPP - is also the first to adopt a Chinese control system: FirmSys. Country: China – Capacity: 6,000MW

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Bruce

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Located in Bruce County, Ontario, the 2,300 acre Bruce Nuclear Generation Station site has eight functional reactors with a combined capacity of 6,430 MW. Providing employment to more than 4,000 people, the plant was built modularly over a 17 year period (1970 to 1987) by Ontario Hydro. Generating approximately 20% of the province’s electricity requirements, the plant is divided into two separate stations: Bruce A and Bruce B. Both stations employ four Canada Deuterium Uranium (CANDU) nuclear reactors. Fuelled by uranium, technicians moderate the core using deuterium-oxide, which allows them to safely control the power output of the reactors. Country: Canada – Capacity: 6,430MW

Kori

Located in a Kori, Busan, the construction of the Kori Nuclear Power Plant began in 1972. The first reactor began active operations in 1978, with six additional units added over the years, ranging from power outputs of 640MW to 1,340MW. In an effort to maintain safety and ensure that the plant continues to operate using modern technology, Kori-1 (the plant’s first reactor) was decommissioned in 2017. Meanwhile, construction of the Kori-5 and 6, which are to be thirdgeneration reactors equipped with stateof-the-art safety features, is still under development. Country: South Korea Capacity: 7,337MW

Kashiwazaki-Kariwa

The largest nuclear power station in the world by output capacity, KashiwazakiKariwa is based on a 4.2km2 site in Japan. Located close to the Sea of Japan, which the site utilises for cooling water, construction of the plant began in 1980 by the Tokyo Electric Power Company and finished five years later. Containing seven operational units - five at 1,067MW and two at 1,315MW - the reactors are fuelled by low-enriched uranium. Following a high-magnitude earthquake in 2011 - the most powerful in Japanese history - all of the plant’s units were shut down for safety inspections, although the plant was relatively unaffected by the earthquake directly. As of 2020, however, the reactors have still not been brought back to functional use. Country: Japan – Capacity: 7,965 MW


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energyworld 38 - September-Ocrtober 2020  

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