Clean energy package: Hoe kan energietechnologie hierop inspelen?

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1 Clean energy package: Hoe kan energietechnologie hierop inspelen? Vleva/Mina sessie 19 Januari 2017 EU 2030 energy & climate objectives % Greenhouse Gas Emissions 20% Renewable Energy 20% Energy Efficiency % Greenhouse Gas Emissions 27% Renewable Energy 27% Energy Efficiency New Key Indicators New governance system 2 1

2 How did it start? Europe didn t stand on the first row when fossil energy resources were distributed between continents. Gas resources North America Latin America Conventional Gas Resources Unconventional Gas Resources Europe Eurasia Middle East Africa Asia Pacific Remaining recoverable resources (tcm) Equivalent in years of current production Conventional Unconventional Total Source: IEA World Energy Outlook, WoodMackenzie Interpreted 4 2

3 European coal and crude oil resources 5 Europe s answer: Let s develop renewable energy sources to secure our energy supply to develop a new competitive industry 3

4 RES potential in Europe (ref FORRES 2020) 7 BE 2030 energy & climate objectives : quid Belgian energymix? Remaining 80%: 20% RES-E 2020 More RES? Energy efficiency? Fossil? centralized/decentralized Nuclear?? 8 4

5 19/01/2017 Wat hebben we geleerd? BE 2020 RES objectives: lessons learned l Competitive advantage is a key success factor Ø l Research & Innovation is a must RES cost must be affordable 10 5

6 BE 2030 energy & climate objectives : quid Belgian energymix? ØRES-E objectives are challenging ØLegitimate questioning on solution for remaining 80%, considering nuclear phase-out, abandon of coal due to environmental issues, high gas prices, low electricity prices ØThere is no single unique solution but different solutions go hand in hand Ø Implement energy efficiency measures intensively? Ø Continue RES development on cost effective basis? Ø Take advantage of conventional gas features (e.g. flexibility)? Ø Give (clean) coal a chance? Ø Keep on line nuclear? Remaining 80%: 20% RES-E 2020 More RES? Energy efficiency? Fossil? centralized/decentralized Nuclear?? 11 Clean energy package: key words from a business / policy perspective l Energy efficiency l Flexibility Storage Demand response l Digital / data management l Capacity remuneration 12 6

7 Energy efficiency Energy efficiency: Savings potential in tertiary sector 14 7

8 ENGIE Tower, showcase of the environmental know how of the group Innovative concepts: Optimized geothermics: geothermal heating and cooling (189 wells, each 82m deep): about 50% of the heating and cooling demands are met. Harnessed energy: solar power (120 kwp), efficient lighting (presence detectors, dimmers), a smart lift system and centralized technical management Ultra-modern climate control: triple glazing, flexible air treatment, high-output coolers, free-chilling techniques on cold water circuits and condensation boilers with low levels of Nox Economic water management: recovery and management of rainwater, waste-water treatment, and lowconsumption sanitary installations Sustainable waste management Ø saving of 31% of primary energy consumption and 38% of CO2 emissions. A mobility plan Let s Choose has been installed to promote public transport 15 Energy savings: key success factors Ø Pilot projects Ø Financing tools Ø Innovative solutions 16 8

9 Flexibility needs Flexibility needs: the Duck curve California s duck curve 18 9

10 Flexibility providers: increased expected needs for storage MW Pumping Turbining Pumping Turbining pumping/turbining cycles per day will be possible h/day Nuclear Flexible Additional flexible baseload fossil pumping/turbining 19 Flexibility providers: storage Different technologies are available, depending on their capacity (MW) and autonomy (MWh) purpose 20 10

11 Technological evolution will reduce cost of decentralised as well as centralised low carbon solutions Battery: Levelized cost of storage* l Battery technology is moving fast: Reduced cost Increased lifetime Increased energy density new applications for electrification (EV, trucks ) EUR2015/MWhstored Standard battery Battery without inverter Reference Disruptive Source: Laborelec/CEEME * Cost for storage only, not including electricity input cost; assuming 320 charging cycles per year, E/P ratio of 2, 4% WACC, 20% VAT 21 Flexibility providers: storage (cntn d) Conventional power plants & demand response as storage providers (fuel storage heat or cold storage) Power (MW) ,1 0,01 Demand Response 1 min 1 h 1 d 1 m 0,001 0,001 0,01 0, Energy (MWh) Gas Coal Nuclear 22 11

12 Flexibility providers: demand response Flexibility at demand side via load shifting and load shedding 23 Flexibility providers: demand response (cntn d) Aggregation of different customers can be done vertically (at same moment) or horizontally (sequentially) 10 MW during 1 hour 10 MW during 1 hour 10 MW during 1 hour 30 MW during 1 hour OR 10 MW during 3 hours Customer 1 decreases demand Customer 2 decreases demand Customer 3 decreases demand 24 12

13 Flexibility providers: demand response (cntn d) Electricity bill evolution retail customer (3500 kwh/y) 299 /MWh +105 % 17% 14% 146 /MWh 22% 46% 4% 33% +168 % 41% 23% Invoice 2006 Invoice 2016 Commodity grid costs RES subsidy Levies ØCommodity cost represents only 23% of total bill to retail customer ØDynamic grid tariffs required (ToU : Time of Use) 25 Dynamic grid tariff roadblocks: Long tariff periods (4 years) Smart meter rollout for residentials 13

14 Digitilization / data management: Key success factor : smart metering Digital / data management : smart metering Head metering Submetering Supplier Internet platform Appliances 28 14

15 smart metering: Will smart head meters be taken in speed by smart submetering? Capacity Remuneration Mechanism: Missing long term segment in current market model required for long term investments 15

16 Capacity Remuneration Mechanism? Missing LT-market FWD MARKETS DAY AHEAD MARKET INTRA DAY MARKET BALAN- CING MARKET 36 months Day-1 Delivery moment Flexibility remuneration ( /MWh) Energy remuneration ( /MWh) Capacity remuneration (CRM) ( /MW) 31 Capacity Remuneration Mechanism: Next step in evolution to near zero variable cost system 16

17 Questions EU 2030 energy & climate objectives 34 17

18 Wind potential in Europe 35 18