Measures and instruments to encourage companies. in order to contribute meeting the challenge of a low carbon economy
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1 Measures and instruments to encourage companies to use renewable or alternative energy technologies, in order to contribute meeting the challenge of a low carbon economy Presentation at the 5 o Congreso International de Ecoeficiencia Y Competitividad Empresarial Hacia una Economia Baja en Carbono Prof. Dr. Uwe Leprich, IZES ggmbh, Saarbruecken, Germany Bogotá, September 10, 2010
2 Uwe Leprich economist, Ph.D. at the University of Bielefeld professor at the business school of the University it of Applied Sciences in Saarbruecken since 1995 at the same time scientific head of the Institute for Future Energy Systems (IZES), a university based research institute focussing on renewable energies, energy efficiency and decentralised power generation author and co-author of several books and articles about liberalised electricity markets, feed-in law regulations and instruments for promoting renewable energies in the heat market. expert member of the Enquete commission Sustainable energy supply of the 14th German Bundestag alternate Board Member of the Agency for the Cooperation of Energy Regulators (ACER) of the European Union 2 [Leprich, September , Bogotá]
3 My institute: the IZES Scientific Directors about 30 staff members, 25 scientists Shareholder: 70% state of Saarland, 4 regional utilities, University of the Saarland, University of Applied Sciences of the Saarland (HTW) 3 [Leprich, September , Bogotá]
4 Selected work Studies and research projects focussing on the German Energy law Feed-in law for electricity from renewable energies Renewable heat law for new buildings Law for electricity from cogeneration plants Energy Efficiency law as the national implementation of the European Energy Service Directive Support Mechanism for Micro CHP Incentive regulation scheme for electricity it and gas networks. 4 [Leprich, September , Bogotá]
5 Agenda 1. The Overall Energy Situation in Germany 2. Energy Use in the Industrial Sector 3. Developments in Renewables and Energy Efficiency 4. Measures and Instruments to speed up Renewables and Energy Efficiency 5. Are there any Lessons for Colombia? 5 [Leprich, September , Bogotá]
6 German primary energy supply 2009 (2008) by fuel (approx PJ) Source: AGEB [Leprich, September , Bogotá]
7 German final energy consumption 2009 by sectors Final Energy Consumption % 26% 29% 29% Industry Traffic Private Households Small Commercial, Trade, Services Source: UB BA [Leprich, September , Bogotá]
8 German electricity generation 2009 by fuel (approx. 600 TWh) Hard coal 18,3% Gas 12,9% Oil 2,1% Misc. 3,9% Renwables 15,6% Nuclear 22,6% Lignite 24,6% Source: BM MWi [Leprich, September , Bogotá]
9 Development of the greenhouse gas emissions in Germany (in Mio. t CO2 eq ) Source: UBA [Leprich, September , Bogotá]
10 Energy related CO2 emissions in Germany 12,7% 57% 5,7% 14% 1,4% 1,1% 45,8% 14,6% 18,6% Pow er and heat plants Private households Commercial sector Other traffic Street traffic Industry Misc. So urce: DIW [Leprich, September , Bogotá]
11 National targets 40% greenhouse gas reduction by 2020 compared to 1990 Increase of the share of renewable energies contributing to electricity it generation to at least 30% by 2020 Increase of the share of cogeneration contributing to electricity it generation to 25% by 2020 Increase of the share of renewable energies contributing to heat consumption to 14% by 2020 Doubling of energy productivity by 2020 compared to [Leprich, September , Bogotá]
12 Germany is heading for a low carbon economy in the medium run! 12 [Leprich, September , Bogotá]
13 Agenda 1. The Overall Energy Situation in Germany 2. Energy Use in the Industrial Sector 3. Developments in Renewables and Energy Efficiency 4. Measures and Instruments to speed up Renewables and Energy Efficiency 5. Are there any Lessons for Colombia? 13 [Leprich, September , Bogotá]
14 Who is working where in the EU economy? Share of employees in 2003 in% primary second ary Zahlenbild der 4/05 tertiary sector 14 [Leprich, September , Bogotá]
15 Gross Added Value for different industrial sectors (%) Manufacturing 15 [Leprich, September , Bogotá]
16 The large picture The German manufacturing industry is a decreasing part of the overall German economy The average energy costs of the German industry are in the range of 2-3% of total t costs The German industry is not very energy intensive! Exceptions: aluminum melt, chlorinate elektrolysis etc. For what purposes does the German industry use energy? 16 [Leprich, September , Bogotá]
17 Primary energy consumption by sectors and applications Lighting Mechanical Energy Industrial Heating (High Temperature) Information and Communication Techn. Space Heating (Low Temperature) Source: FfE [Leprich, September , Bogotá]
18 Final energy consumption in the industry by applications and fuels Sector applicat. coal oil fuel gas renew. d.heat electri. sum Source: FfE [Leprich, September , Bogotá]
19 Agenda 1. The Overall Energy Situation in Germany 2. Energy Use in the Industrial Sector 3. Developments in Renewables and Energy Efficiency 4. Measures and Instruments to speed up Renewables and Energy Efficiency 5. Are there any Lessons for Colombia? 19 [Leprich, September , Bogotá]
20 20 [Leprich, September , Bogotá] Source: BMU 2010
21 21 [Leprich, September , Bogotá] Source: BMU 2010
22 22 [Leprich, September , Bogotá] Source: BMU 2010
23 23 [Leprich, September , Bogotá] Source: BMU 2010
24 24 [Leprich, September , Bogotá] Source: BMU 2010
25 Success story wind Quelle: BWE [Leprich, September , Bogotá]
26 Repower 6 M 6,15 MW el 126 m diameter 117 m Hub height 26 [Leprich, September , Bogotá]
27 27 [Leprich, September , Bogotá] Source: BMU 2010
28 30 [Leprich, September , Bogotá] Source: BMU 2010
29 31 [Leprich, September , Bogotá] Source: BMU 2010
30 But don t forget energy efficiency it is as important as the use of renewable energies! 32 [Leprich, September , Bogotá]
31 Decoupling efficiency at the move Gross Added Value Primary Energy Consumption Gross Electricity Consumption Source: Thöne/Fahl/Blesel [Leprich, September , Bogotá]
32 Development of energy productivity Target 2020 Source: Stinglwagner [Leprich, September , Bogotá]
33 The Energy Conservation Supply Curve for the German industry 2020 Source: McKinsey [Leprich, September , Bogotá]
34 Interim Remarks In the industrial sector high temperature heat and electricity are usually the dominant uses of energy Renewable energies are mainly used for electricity generation, for fuel supply and for hot water, not for high temperature heat Energy efficiency i in the industrial i sector offers a broad range of options with very low life cycle costs The structural transformation of the economy from manufacturing to the service sector (tertiary sector) automatically leads to less use of energy 36 [Leprich, September , Bogotá]
35 Agenda 1. The Overall Energy Situation in Germany 2. Energy Use in the Industrial Sector 3. Developments in Renewables and Energy Efficiency 4. Measures and Instruments to speed up Renewables and Energy Efficiency 5. Are there any Lessons for Colombia? 37 [Leprich, September , Bogotá]
36 38 [Leprich, September , Bogotá] The toolbox
37 Legal framework for REN and EE ETS REN / EE Command and control 39 [Leprich, September , Bogotá]
38 Legal framework for REN and EE ETS REN / EE Market based / financial 40 [Leprich, September , Bogotá]
39 Selected measures and instruments Command Market based Else and Control Feed-in tariff Contracting Ecodesign direct support Efficiency directive schemes networks (EU) if you want if there is if you have to avoid direct money flows some money with the state market players who can make a and / or the customers business out of it 41 [Leprich, September , Bogotá]
40 42 [Leprich, September , Bogotá] a) Ecodesign Directive
41 43 [Leprich, September , Bogotá]
42 44 [Leprich, September , Bogotá]
43 The problem with standards: they are often not very ambitious! 45 [Leprich, September , Bogotá]
44 46 [Leprich, September , Bogotá] b) Feed-in tariff
45 47 [Leprich, September , Bogotá]
46 48 [Leprich, September , Bogotá] Feed-in tariffs 2009
47 The problem with feed-in tariffs: sometimes they do not give enough incentives to bring the costs of the technologies down 49 [Leprich, September , Bogotá]
48 50 [Leprich, September , Bogotá] c) Contracting
49 51 [Leprich, September , Bogotá] The idea
50 52 [Leprich, September , Bogotá] German Model Contract
51 53 [Leprich, September , Bogotá] German Model Contract (Ctd.)
52 54 [Leprich, September , Bogotá] d) Efficiency networks
53 Overall target of the network A Learning Energy Efficiency Network (LEEN) meets on a regular basis with at least local/regional companies in order to cut energy costs with the help of external experts. The meetings are professionally organised and serve as a forum to exchange experiences. 55 [Leprich, September , Bogotá]
54 Further targets grab the low hanging fruits rapidly decrease information/transaction costs cut direct and indirect CO2 emissions increase awareness for energy efficiency within the companies anticipate changes in the legal framework 56 [Leprich, September , Bogotá]
55 Participants local/regional companies with energy costs higher than per year companies with a high share of their energy use for non-production technologies (e.g. heating, cooling, lighting,..) parts of large companies companies from different branches, no competitors 57 [Leprich, September , Bogotá]
56 The problem with efficiency networks: energy is usually a low interest issue for companies 58 [Leprich, September , Bogotá]
57 Agenda 1. The Overall Energy Situation in Germany 2. Energy Use in the Industrial Sector 3. Developments in Renewables and Energy Efficiency 4. Measures and Instruments to speed up Renewables and Energy Efficiency 5. Are there any Lessons for Colombia? 59 [Leprich, September , Bogotá]
58 If standards are o.k., start with motors! large potential in the industry cost effective measure available technologies 60 [Leprich, September , Bogotá]
59 If a feed-in tariff is o.k., start with mine gas (methane) sewage treatment plant gas landfill gas possibly biogas 61 [Leprich, September , Bogotá]
60 Contracting.. could be triggered for industrial companies if it is accompanied by a certain risk guarantee from the state. Otherwise this market will not fly and will remain a small niche market. A good starting point for contracting are public buildings anyway (no risk). 63 [Leprich, September , Bogotá]
61 Efficiency networks.. could be supported by very little means from the state or the utilities. They could benefit from experiences in Germany. They should be accompanied by the commitment of the participating p companies to apply ppy longer payback periods to energy efficiency investments than to their usual investments in order to realise a larger part of the efficiency i potential. ti 64 [Leprich, September , Bogotá]
62 Final remarks Progress towards the increasing use of renewable or alternative energy technologies in the industry heavily relies on the overall spirit to go for a low carbon economy national overall and sector targets to fill the spirit with lives the implementation of effective instruments and measures to reach the targets the readiness of the companies to take some technical risks in order to cut energy costs in the medium and long run. 65 [Leprich, September , Bogotá]
63 66 [Leprich, September , Bogotá]... for the sake of the planet!
64 Thank you very much for your attention! Institut für ZukunftsEnergieSysteme (IZES) Altenkesselerstr. 17, Gebäude A Saarbrücken Tel Fax Homepage 67 [Leprich, September , Bogotá]
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