Convegno Italcogen - Key Energy 2014

Transcription

1 Convegno Italcogen - Key Energy 2014 European energy and climate framework : Outlook to 2020 and what does the 2030 target structure imply?

2 Current status of CHP in Europe: GW CHP capacity 2011 (Eurostat data) 80% of total EU capacity 90% of total EU capacity

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4 Energy Market changes impacting large CHPs Revolution in Gas market leading to relatively high EU Gas prices Economic downturn impacting heat and electricity demand Low wholesale electricity price in much of Europe and uncertain future market Over capacity in electricity generationin several member states(dk,sp,nl,d) A Perfect Storm 4

5 EU 2030 Energy and Climate Strategy and CHP

6 Cogeneration helps all three goals of Europe s Energy and Climate strategy And what else to 2030/

7 As from November a new European Commision... More politicised New structure and new way of working for the most important institutions Less administrative (better regulation principle 7

8 VWG Advocacy & Comm. Campaign Policy and institutional context 8

9 VWG Advocacy & Comm. Campaign Policy and institutional context EC Project Team led by VP Maroš Šefčovič: A Resilient Energy Union with a Forward-Looking Climate Change Policy 9

10 VWG Advocacy & Comm. Campaign Policy and institutional context EC Project Team led by VP Maroš Šefčovič: A Resilient Energy Union with a Forward-Looking Climate Change Policy 10

11 EU legislations Now Heads Of State agreed on the 2030 policy framework for Climate and Energy : 40% GHG cut, 27% RES penetration at EU level and a 27% indicative EE target By spring 2015: An ambitious Jobs, Growth and Investment Package worth 300 billion A European Energy Security Strategy and the Energy Union.

12 EU legislations to 2030 Development of secondary legislations in support to the 2030 Climate and Energy policies framework: EU ETS reform (linear reduction factor + carbon leakage+ non ETS emissions ) new governance structure for RES and Energy Efficiency (including and assessment of the effectiveness and possible reopening of the EED 2017) Deep overhaul of the electricity target model? Possible move towards reducing the amount of EU legislation (better regulation)?

13 2030 Energy & Climate Framework timeline 27 March Jan July Oct 2014 Q Q Publication of the Green Paper COM(2013)1 69 COM on the Climate and Energy framework COM on the Energy Efficiency Political Signatories to Kyoto Protocol expected to make pledges regarding their CO2 cuts PARIS?

14 EU legislations Now Heads Of State agreed on the 2030 policy framework for Climate and Energy : 40% GHG cut, 27% RES penetration at EU level and a 27% indicative EE target By spring 2015: An ambitious Jobs, Growth and Investment Package worth 300 billion A European Energy Security Strategy and the Energy Union.

15 EU legislations Now Heads Of State agreed on the 2030 policy framework for Climate and Energy : 40% GHG cut, 27% RES penetration at EU level and a 27% indicative EE target By spring 2015: An ambitious Jobs, Growth and Investment Package worth 300 billion A European Energy Security Strategy and the Energy Union.

16 Climate side of the equation After 2020: Stopping of the Fuel Quality Directive & RES-transport target (decarbonisation of the supply-retail of transport fuels+ penetration of biofuels) but also no RES Elec or H&C target. The Commission s papers indicate a domestic EU ETS reduction target of 43% from 1990 levels, which would imply an increase in the linear reduction factor from 1.74% to 2.2% per year Future of the ESD, CO2 emission in agriculture, non CO2 GHG emissions to be assessed later No conditional target linked to the success of the international negotiations for a GHG agreement. But if successful then international credits will top up the 43% domestic GHG cut for the EU

17 Cogeneration and DHC networks can help significantly decreasing primary energy consumption and switching to lowcarbon solutions Cogeneration Industrial waste heat Renewables sources e.g. geothermal, solar thermal, biomass Other efficient heating /cooling solutions e.g. heat pumps

18 CHP in the 2030 Framework: Growth drivers & opportunities for CHP Expansion of CHP in industry and in district heating & cooling: driven also by the Energy Efficiency Directive Expansion of renewable CHP: biomass and novel technologies Expansion of flexible CHP: in balancing of variable renewable electricity and as part of demand side resources, driven also by the Energy Efficiency Directive

19 CHP in the 2030 Framework: Challenges for CHP Reduction in heat demand due to energy efficiency improvement mainly in buildings Industrial development trends: uncertainties of economic trends, industrial structure, demand, technologies Phasing out of fossil fuels: gas-fired (dominant fuel) CHP will be affected, conventional fuel CHP is a transitional technology Country specific variations in potentials & in CHP traditions (lack of knowledge, CHP culture this can be addressed by policies, Energy Efficiency Directive)

20 The share of CHP in EU electricity production under long-term EU scenarios 25,0 Share of CHP in Electricity Production -EE scenario 2050 (%) 20,0 15,0 10,0 Share of CHP in Electricity Production - EE scenario ,0 Source: EU 2050 energy roadmap EE scenario, Primes modeling 0,

21 EU legislations Now Heads Of State agreed on the 2030 policy framework for Climate and Energy : 40% GHG cut, 27% RES penetration at EU level and a 27% indicative EE target By spring 2015: An ambitious Jobs, Growth and Investment Package worth 300 billion A European Energy Security Strategy and the Energy Union.

22 Security of Supply : Gas network stress tests. Commission Stress test : Considered the disruption of the Ukrainian gas transit route as well as all Russian gas flows to Europe for periods of one month and six months Commission Recommends fuel switching through district heating and cogeneration in the residential, tertiary and industrial sectors. Heat demand reduction in industry and transformation Security of supply is going to drive towards more independence from gas. How to take control of the story around the path to low carbon/renewables CHP? 22

23 Heat is the biggest driver of EU energy consumption Primary Energy Consumption by Use in Mtoe (2010) 17% 121 Heat 299 Transport % Electricity Non-energy, Own Consumption, Losses 21%

24 Direct Impact CHP legislation Study for proposal on new harmonised energy efficiency reference values under the EED in preparation. Internal Electricity Market: implementation of key Network Codes Amendments to an agreement on a new MCP directive (medium size combustion plants) Agreement on a revised Bref LCP 24

25 Additional impact Internal Energy (electricity) Market: focus on retail rules, end-users, DSM, aggregators ETS flanking measure MSR market stability reserve Implementation of the new State Aid doctrine in the field of energy and environment Putting the energy union concept into action

26 2015 Introduction To be fully introduced in 2015 Review of the electricity PEF primary energy factor Development of a European Heat Strategy? Review of the buildings Directive EPBD (end 2015) Evaluation by COM of the 28 national Comprehensive Assessments under the EED Possible repair strategy to article 14 depending on the outcome of this evaluation (early 2016) 26

27 EED: Structure of the legislation 27 Directive with legal weight of European law There is no binding target at the European level; instead the EED includes binding measures Each member state (MS) will have to define its own indicative target, and is required to present an action plan for energy efficiency every three years - in 2014,in 2017 and in 2020 The Commission will evaluate the progress and action plans by June 2014; The Commission is entitled to propose stricter measures and even to set a binding target if national actions are deemed insufficient) The entry into force of this Directive will repeal the CHP Directive 2004/8/EC as well as most of the Energy Services Directive 2006/32/EC

28 Main milestones in the implementation of the EED Nov, 2012 May, 2013 April, June 2014 Jan, 2015 Dec, 2015 Apr, 2017 Dec,

29 MS Obligations 1. Comprehensive assessment (CA) of the potential for application of high efficiency CHP &DHC (Article 14(1), ANNEX VIII) Cost-benefit analysis (CBA) - NATIONAL Identification of the most resource and cost efficient solutions (Article 14(3), ANNEX IX) 3. Take adequate measures adopt policies Local and regional level 4. CBA INSTALLATIONS(financial analysis) Article 14(5), Part 2 of ANNEX IX Authorisation & permit criteria INSTALLATIONS Article 14(7) Exemptions

30 EED - Article 14, Annexes VIII & IX 30 MS shall carry out by 31 December 2015 a «comprehensive assessment» (CA) of the potential for the application of high-efficiency cogeneration and efficient district heating and cooling CA shall contain the information set out in Annex VIII As part of the CA, Member State shall carry out a cost-benefit analysis (CBA) according to Annex IX part 1 Covering their territory Based on climate conditions, economic feasibility and technical suitability If the outcome of CBA is positive then: Member States shall take adequate measures [ ] and/or to accommodate the development of high-efficiency cogeneration [ ] Each installation above 20 MW thermal input shall carry out a CBA according to Annex IX part 2 Authorisation/permitting decision shall take into account the outcome of the CBA www.

31 31 How Article 14 works www.

32 EED - Article 14 & Annexes 32 Annexes I, II and X (HE CHP methodology and PES calculation + Guarantee of Origin): No change AnnexI: Delegated act needed for the review of the ref values (by 2015 and then every 10 years but possible loophole for the 2025 review) Annex VIII potential for efficiency in heating and cooling : Comprehensive assessment shall include [ ] Strategies, policies and measures that may be adopted up to 2020 and up to 2030 Potential identified via 2004/8/EC and Primary Energy Savings are clearly indicated Annex IX Cost benefit analysis (CBA) : 2 partsone foranalysis at territory level, the other one at installation level Net Present Value criteria Time horizon of CBA mentioned for handful of examples www.

33 EED - Article Article 15 obliges Member State to ensure that cogenerated electricity from high efficiency CHP gets: a guaranteed transmission and distribution priority or guaranteed access to the grid priority of dispatch in so far as the secure operation of the national electricity system permits AND: Reference is made to Electricity Directive, 2009/72/EC Reference is made to the RES-E provisions in Directive 2009/28/EC When ranking different types/classes of generators, variable RES-E shall be first but high efficiency CHP may be on a parity level However, MS shall take into account the need to ensure continuity in heat supply www.

34 EED - Article 15 (5) 34 Without prejudice to Article 16(2) of Directive 2009/28/EC and taking into account the provisions of Article 15(1) and (2) of Directive 2009/72/EC and the need to ensure continuity in heat supply,. Member State shall ensure that rules relating to the ranking of the different access and dispatch priorities granted in their electricity systems are clearly explained in detail and published. When providing priority access or dispatch for high efficiency cogeneration, Member States may set rankings as between, and within different types of, renewable energy and high efficiency cogeneration and shall in any case ensure that priority access or dispatch for energy from variable renewable energy sources is not hampered. www.

35 EED - Article 7 35 Aiming at changing the way companies retail energy energy services promotion Full latitude to design the scheme based on Primary or Final Energy Savings 1.5% energy saving target per annum for obligated parties (to be designated by MS) ETS covered installations may be excluded from the obligation Par. 2.c) allowing energy savings achieved in the supply side to be taken into account MS may use this approach but no double counting allowed Par 3. capping at 25% the bundle effect of all the flexible measures Linkages to the EPB Directive Energy Services Companies to take part in the «energy efficiency obligation schemes» www.

36 Article 7.1: and Annex V www.

37 Article 7.2: and Annex V www.

38 Other Articles of interest Article 3 : Each member state to set indicative energy efficiency targets. Article 15 (again) :Demand Side Management provisions and balancing potential of HE CHP clearly mentioned (with MS setting penalties for those hampering the development of those markets) Article 7 : Energy Efficiency Obligation Scheme (1.5% per year) on energy suppliers Can include savings made in energy transformation sector. Article 20..Energy Efficiency National Fund Article 17.Online tools to raise awareness on EE solutions Article 8..And other: auditing, empowerment of customers... www.

39 EED positives for CHP growth 39 Article 14 Comprehensive Assessment : Strong scrutiny needed on annexes VIII & IX, decision-making process + methodologies could be useful focus for coalition on CHP. Article 15 Annex VIII UK and Danish experience and work CODE 2 process helps identify barriers and adequate measures, particularly under 20MW. CODE 2 develops proposals on micro CHP Article 7 According to the national context, action will be needed in the process of setting the priority of dispatch ranking. Propose CHP electricity equal to renewables. Make sure link to Energy Performance of Buildings Directive (EPBD) 2010/31/EU in what regards DHC and micro-chp is well understood and clear enough Utilities may be encouraged to understand the value of implementing CHPs while moving to ESCompanies Additional Articles Micro-chp mentioned many times throughout the text (recitals + articles 12, 15+ annexe VIII ) Demand Side Management provisions and balancing potential of HE CHP clearly mentioned (with MS setting penalties for those hampering the development of those markets) financing opportunities for the EE sector Online tools to raise awareness on EE solutions And many more: auditing, empowerment of customers... www.

40 What is the potential for CHP growth in Europe 40

41 Timeline of actions (2014) Jan/Feb Mar April May June July/Aug Sept Oct Nov..May Research (case studies, technical information, facts & figures) Possible COGEN Actions Messaging Materials : fact sheets Briefings Outreach to MEPs Commission policy makers Outreach New Parliament Continued events / communication/ use stakeholder network multipliers/include in all public addresses.

42 CHP is developing to meet the new challenges Percentage of Bio-based CHP is clearly growing (16.3% : 2012) District heating with CHP is now over 75% of the District Heating in Europe.Heat networks are of interest for introducing renewables. Small and micro CHP are a fast developing trend driven by high retail electricity price. Manufacturers are adapting traditional product lines and project designs for flexibility Innovation small ( sterling, fuel cells), and turbines and engines.

43 European Industrial and Energy Policy Links 43

44 The way forward for CHP The CHP Sector 1) The CHP and DH supply sector to enhance the offering to customers with total energy solutions that meet the needs of both the heat demand and the changing electricity market. 2) Growth in utilities and ESCOS providing management and market services to industry and third parties. 3) Find sustainble approaches to fuel diversity in the sector. European Commission and member state policy 1) Stabilise policy around energy particularly the electricity sector and fix the electricity market. 2) At EU level put more effort into understanding and plannning for heat. Develop of a heat strategy leading to an integrated energy supply approach. 3) Focus on Energy Efficiency along the full energy supply chain and ensure Primary Energy Savings is reported.

45 Main developments: Energy Efficiency Directive (EED) December 2013 deadline: Notification of exemptions for the carrying out of individual CBAs (17-19 MS) 5 June deadline: CBAs should be mandatory for installations > 20 MW th Several countries have started to align national policies with the main provisions contained in the EED but no good sign on CHP related provisions (Sp, Pt, Nl ) Focus has been on Article 7 EOS end-use energy savings targets (deadline 5 December 2013) Review of the EED (gap analysis) mid 2014 will be crucial Actions and next steps: Liaise with the consultancy that will perform the review of the Reference values for high-efficiency cogeneration (due by 31/12/2014) Help MS to include CHP in the measures eligible under art 7 Fora: CA on the EED, CODE 2 project, COGEN Europe national members

46 ENERGY EFFICIENCY DIRECTIVE 46

47 COGEN Europe The European Association for the Promotion of Cogeneration Avenue des Arts 3-4-5, 1210 Brussels, Belgium T +32 (0) F +32 (0) info@ www. 47

48 Growing challenge in RES support & firm power TSO Embedded Generation Energy Storage Anaerobic Digestion Energy from Waste Biogas Primary Generation OOOOOOO RESIDENTIAL Domestic Generation PV Micro CHP Communications Network Metering Electrification Heat Pumps In Home Energy Management Energy Storage Islanded House Consumer Arbitrage Distribution System Industrial Large Consumer May Have On-Site Generation Emobility Home Charging Vehicle 2 Grid TSO: Transmission System Operator DSO: Distribution System Operator BEMS: Building www. Energy Management System HVAC: Heating, Ventilation and Air Conditioning Public Charging Infrastructure Fast Charging Highways / Street Station Lighting Community Power and Heat networks Energy Centres Offices/Commercial BEMS On Site Generation HVAC Vehicle Charging

49 Portfolio of NEAS Energy agregater Denmark Neas Energy s portfolio includes: Combined Heat & Power 1,660 MW installed capacity Renewables 3,520 MW installed capacity. Largest independent wind power trader Supply & large scale consumption 2.3 TWh Natural gas trading 36,000 MWh turnover daily (avg.) Renewable energy certificates (GoO, EECS, CERs, VERs, Elcerts, LECs) 49

50 Outreach COGEN Europe communications changes; outreach to new ITRE committee Industrial Renaissance Deeper Look at CHP Case studies My CHP (separate presentation) COGEN Exhibition (separate presentation) 50