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energy transition

Fuentes: Elaborado por AleaSoft con datos de REE y del Ministerio para la Transición Ecológica / Source: Prepared by AleaSoft using data from REE and the Ministry for the Ecological Transition

AleaSoft analyses the content of the Integrated National Energy and Climate Plan and its proposals for the electricity sector, where the role that the consultancy foresees for hydrogen technologies is lacking.

The Integrated National Energy and Climate Plan (NECP) is a broad and cross-cutting document that addresses the goal of reducing greenhouse gas (GHG) emission from many angles, from transportation and electricity generation, to employment and R&D. The objective of the Plan is to achieve a 20% reduction in emissions in 2030 compared to the levels recorded in 1990. This means reducing the current emission levels by more than 30%. The draft lays the foundations to advance in the energy transition and achieve the ultimate goal of totally decarbonising the economy and converting Spain into a carbon neutral country by 2050.

In the energy transition and the reduction of polluting gas emissions, electricity generation will have a central role. The electricity generation sector is one of the most responsible for the emission of CO2 and other greenhouse gases, but it is also one of the sectors with the greatest power to reduce emissions thanks to the production of electricity from renewable energy sources.

The objective of the Plan is to achieve, in the year 2030, a penetration of renewable energy sources in the final energy consumption of at least 35%. Specifically for the electricity system, the objective is the generation of at least 70% of the electricity from renewable sources by 2030 and with the final goal of 100% by 2050. To do this, the NECP proposes to install 69 GW of renewable capacity before 2030, and reduce conventional generation by 15 GW.

The star technology in this renewable revolution will be the solar energy with new 37 GW, of which 32 GW will be of photovoltaic technology and 5 GW of solar thermal. This new capacity to be installed represents an increase of 530% compared to the current power. The second potential technology to be installed before 2030 is the wind energy with new 27 GW and a capacity growth of 114%. And behind the solar and the wind energy, with much less new capacity are the rest of renewable technologies that will add another 5 GW.

On the side of the reduction of conventional generation, the technology that is intended to be eliminated more quickly is coal. In 2030, it is expected to have removed at least 8.7 GW from the current 10 GW, but with the possibility of closing 100% of the power plants if security of supply allows it. The Plan estimates that coal thermal power stations will no longer be competitive by 2030 if the price of CO2 emission rights reaches 35 €/t. Right now, the price of emissions is around 23 €/t after it tripled in 2018.

The other conventional technology condemned to disappear according to the draft is the nuclear. By 2030 it is expected to halve the installed capacity by closing 4 GW. On a smaller scale, the other technologies to be reduced are cogeneration, generation with waste and fuel-gas.

The willingness of the Plan to withdraw up to 2 GW of cogeneration is somehow surprising. The employers of the sector have already shown their disagreement. Cogeneration is one of the most efficient ways to produce heat for the industry. Producing all that thermal energy directly using electricity would be a disproportionate expense for those industries. According to AleaSoft, the best strategy to reduce emissions in industries that require heat is cogeneration with renewable gas or even with hydrogen, which, according to the consultancy, is the fuel of the future and, in addition, does not produce emissions.

As highlighted by AleaSoft, the renewable transition proposal of the Plan shows very explicitly the need that renewable energies continue to have a backup technology due to its intermittent nature: to remove 15 GW of conventional capacity it is necessary to install 69 GW of renewable capacity . The draft is committed to maintaining gas as a backup technology, maintaining the installed capacity of this technology at least until 2030. But the support for intermittent renewable production is also addressed from two other angles: storage and interconnections.

In terms of energy storage, the Plan will promote the pumped storage hydropower plants with new 3.5 GW that allow the management of renewable production and, additionally, can support the regulation of watersheds in conditions of extreme phenomena. The installation of up to 2.5 GW of batteries is also contemplated gradually as the technology matures.

In AleaSoft the mention of hydrogen is lacking as a tool for storing large amounts of energy over long periods of time, being able to counteract the seasonality of a large part of the renewable production. In the Plan, hydrogen is only mentioned as an alternative fuel for transportation.

On the interconnection side, the Plan contemplates the already planned projects to increase interconnections with France up to 8000 MW and with Portugal up to 3000 MW. Even with these increases in exchange capacity, Spain will not achieve a 10% interconnection with respect to its total installed capacity and will continue far from the minimum target of 15% of the European Union.

The draft Plan also takes into account the increase in energy efficiency as an essential tool for the energy transition.

Other important aspects that the draft also takes into account are self-consumption and, in general, a more active role for the consumer. With the approval of the Plan, the demand aggregator will be created as the new subject of the electricity sector to boost the participation of demand in the ancillary services. It is promoted that the aggregation of demand allows a greater participation of distributed generation and self-consumption in the imbalance and ancillary markets.

Source: AleaSoft Energy Forecasting

InnoEnergy, Naturgy, Enagás, Barcelona Activa and CEiiA are promoting the 4th call for entries of Cleantech Camp, a programme designed for business ideas or start-ups that are entering the clean energy sector.

The programme, that will fund pilot projects with their industrial partners, will be implemented in Barcelona, Madrid and Porto and promotes Open Innovation. It will select a maximum of 15 aspiring projects and award funding amounting to over €50,000 to incentivise their development.

The programme promoters expect to receive ideas from which they can select projects that promote an efficient use of energy, the application of sustainable energies, the energy transition and digitisation in the field of energy. Cleantech Camp is looking for digital projects with an industrial vocation geared towards energy efficiency that facilitate the energy transition, distributed generation empowering the consumer, whose applications are developed on the basis of new technologies such as the blockchain, the use of Big Data and AI.

One of this year’s innovations is the inclusion of projects that focus on biogas, biomethane, hydrogen and Smart Factory, in addition to other themes already associated with the programme namely, energy efficiency, sustainable mobility, smart grids and smart cities and sustainable and renewable energy.

The selected projects will follow a training programme in Barcelona, Madrid and Porto over several weeks, and will benefit from the participation of ESADE as a training partner. The course will combine training and informative sessions, specialised workshops for the development of the projects and networking meetings, coordinated by different experts.

The projects will additionally be able to access working spaces at Barcelona Activa, the InnovaHub at Naturgy, the Enagás FAB and Enagás Venture Center in Madrid and the CEiiA facilities in Porto.

Global programme partners, Naturgy and Enagás, announce the following challenges

Naturgy is looking for solutions in the following fields:

• Artificial Intelligence applied to the client.
• Combined renewable gas and renewable electricity solutions.

It is also seeking new business models in:

• Sustainable mobility.
• Batteries and self-consumption.

Enagás is focusing on the following solutions and business models:

• Sustainable mobility using:
o VNG,
o renewable gas (biogas-biomethane),
o Power2Gas, and
o renewable hydrogen generation.
• Solutions for storage, regasification and the transport of natural gas and other renewable gases.

In June, the top three projects offering the greatest potential will be selected out of all the participants, receiving funding of €20,000, €10,000 and €5,000 respectively. These projects will also benefit from other contributions in kind from the different programme collaborators, to promote their growth and consolidation. One of the main innovations in this year’s edition is that the selected start-ups must submit a commercial pilot of their project. The Cleantech Camp jury will select three pilots to be co-funded by the programme and developed jointly with Naturgy, Enagás and CEiiA.

Fostering Open Innovation

Cleantech Camp is driven by InnoEnergy, Naturgy, Enagás (through its Corporate Entrepreneurship and Open Innovation Programme, ‘Enagás Emprende’) and Barcelona Activa. It enjoys the collaboration of the Portuguese research centre, CEiiA and the companies Ateknea, ZBM and Osborne that act as Knowledge Partners, bringing their expertise to the table in the fields of patents, legal regulations and public funding.

The programme is clearly committed to promoting Open Innovation between the driver companies and participating start-ups, in order to create a knowledge exchange ecosystem from which both large companies and emerging projects can benefit.

Register to take part in the programme online at www.cleantechcamp.com from 23 January to 24 February.

FuturENERGY Dec. 18 - Jan. 2019

The home straight of 2018 has brought with it an avalanche of information at national and global level that shares a common thread: the form the reality of an energy transition will take, whose context is the fight against climate change and a new consumption model that has to efficiently accommodate the growing needs of humankind with the resources available…By Arturo Pérez de Lucia, Managing Director of AEDIVE, the Business Association for the Boosting and Development of the EV Market.

FuturENERGY Dec. 18 - Jan. 2019

MARCONA de David Huamani. Primer premio del Concurso de Fotografía Eolo 2017 MARCONA by David Huamani. First prize in the 2017 Eolo Photography Competition

The future of wind power in Spain is promising and unstoppable. The sector is ready to successfully develop the growth of its wind farm stock and, one of its immediate challenges, before March 2020, is to put into operation the wind power capacity from the three auctions held in 2016 and 2017, in other words, 4,600 MW of new wind capacity plus the Canary Island quota. The installation of this capacity is an opportunity for market growth and will have a positive effect…By Juan Virgilio Márquez, Managing Director of AEE, the Spanish Wind Energy Association.

FuturENERGY Dec. 18 - Jan. 2019

Integración fotovoltaica en edificios. Autoconsumo. Fuente CIEMAT | Integrating PV into buildings. Self-consumption. Source CIEMAT

Three years after the now famous Paris agreement and with the sad fact of an increase in both global and Spanish emissions of CO2, 2018 finally marked the appearance of unmistakeable signs of a sure about-turn towards decarbonising the European and Spanish economies, identifying the energy transition as a fundamental pillar of this process and consequently, placing the energy sector at the centre of social and media attention. This article analyses three points of view: the institutional, the industrial and the technological… By Maria Luisa Castaño, Director, Energy Department. CIEMAT.

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As climate discussions are underway among global leaders at COP24, the annual United Nations Framework Convention on Climate Change (UNFCCC) conference, a new report showcases the feasibility of a European energy transition to 100% renewable sources. The new scientific study shows that the transition to 100% renewable energy will be economically competitive with today’s conventional fossil fuel and nuclear energy system, and lead greenhouse gas emissions to zero before 2050. The study’s financial case for an energy transition becomes even stronger when taking into account significant projected job growth and the indirect economic benefits for health, security, and the environment, that were not factored into the study.

Undertaken by LUT University and Energy Watch Group, the first-of-its-kind scientific modeling study has simulated a full energy transition in Europe across the power, heat, transport, and desalination sectors by 2050. The study’s publication came after approximately four and a half years of data collection, and technical and financial modeling under the research and analysis of 14 scientists.

This report confirms that a transition to 100% renewable energy across all sectors is possible and not more expensive than today’s energy system,” said Hans-Josef Fell, former German parliamentarian and president of Energy Watch Group, during its COP24 press conference, “It demonstrates that Europe can switch to a zero-emission energy system. Therefore, European leaders can and should do much more for climate protection than what is currently on the table.

Some of the study’s key findings:

• The transition will require mass electrification across all energy sectors. Total power generation will exceed four to five times that of 2015, with electricity constituting for more than 85% of primary energy demand in 2050. Simultaneously, fossil fuels and nuclear are phased out completely across all sectors.
• Electricity generation in the 100% renewable energy system will consist of the following mix of power sources: solar PV (62%), wind (32%), hydropower (4%), bioenergy (2%) and geothermal energy (<1%). • Wind and solar make up 94% of total electricity supply by 2050, and approximately 85% of the renewable energy supply will come from decentralized local and regional generation. • 100% renewable energy is not more expensive: The levelised cost of energy for a fully sustainable energy system in Europe remains stable, ranging from 50-60 €/MWh through the transition. • Europe’s annual greenhouse gas emissions decline steadily through the transition, from approximately 4200 MtCO2 eq. in 2015 to zero by 2050 across all sectors. • A 100% renewable power system will employ 3 to 3.5 million people. The approximate 800,000 jobs in the European coal industry of 2015 will be zeroed out by 2050, and will be overcompensated by more than 1.5-million new jobs in the renewable energy sector. “The results of the study showcase that the current goals set forth under the Paris Agreement can and should be accelerated,” said Dr. Christian Breyer, professor for solar economy at Finland’s LUT University, “The transition to 100% clean, renewable energy is very realistic, right now, with the technology we have available today.

The study concludes with policy recommendations to promote a swift uptake of renewable energy and zero-emission technology adoption. Primary measures promoted in the report include support of sector coupling, private investments, tax benefits, legal privileges, with a simultaneous phase out of coal and fossil fuel subsides. By implementing strong political frameworks, the report shows that a transition to 100% renewable energy can be realised even earlier than 2050.

Source: Energy Watch Group (EWG)

2018 promised to be a very intensive year for Spanish market of renewable energies and so it has been. Projects of last public tenders have been awarded during this year and most of them are already in execution. This trend in contracting seems to be confirmed in following years due to the determinate position of the public administration to accelerate the energy transition and achieve the EU targets and the different international agreements.

GES has been awarded during 2018 up to date 388 MW in wind and solar farms to be built in Galicia, Aragon and Andalusia. GES has begun the execution of 105 MW and plans to begin the rest of the projects by end of the year.

In wind turbine installation activity, during 2017 GES reinforced his strategy to offer services with very high added value, acquiring a crane that is already operative.This action has let GES close an agreement for the reservation of his installation services including two teams and the recently acquired crane for a good part of 2019. Installation team has a strategy to sing alliances with crane companies that complete the services and the reinforcement of its own team for carrying out the high demand that is expected form next year.

Therefore, GEs team is very satisfied with the work done in Spanish market, a market that the firm knows very well. 2019 promises to be a great year for renewables in Span and the company is working to consolidate the results of the current year.

Source: GES

Flexible energy options, such as energy storage, smart-charging electric vehicles, demand response and interconnectors, are needed to ensure that the energy transition proceeds on an optimal path. Our expensive power system would otherwise be reliant on fossil-fueled backup and installing excess wind and solar capacity.

The four types of flexibility mentioned above can accelerate the transition to a cleaner power system and ultimately enable the efficient integration of 80% or more renewable energy by 2040, according to two reports published today by BloombergNEF (BNEF) in partnership with Eaton and Statkraft.

The Flexibility Solutions for High-Renewable Energy Systems reports model a number of alternative scenarios for future power systems in the UK and Germany, respectively, depending on how each flexibility technology might develop in the coming years.

Energy storage and smart electric vehicle charging provide flexibility by moving large volumes of renewable energy to periods of high demand, or moving demand to periods of high renewable generation. Dispatchable demand response reduces the need for fossil-fired backup plants in the power system, reducing emissions. Interconnecting to Nordic hydro can address periods of both excess supply and excess demand, providing different benefits over the decades as the needs of the system evolve.

The two studies – focused on the UK and Germany – highlight that policies and regulation accelerating the adoption of these technologies are key to make a cleaner, cheaper, and more efficient power system possible.

Specific findings for the UK include:

•None of the scenarios halt the transition to a low-carbon power system. In all scenarios, the renewable share of generation exceeds 70% by 2030 as wind and solar become dominant, thanks to their dramatic and ongoing cost improvements. However, without new sources of clean flexibility, the system will be oversized and wasteful, making it 13% more expensive by 2040 and with 36% higher emissions.
•Greater electrification of transport yields major emissions savings with little risk to the power generation system. Avoided fuel emissions far outstrip added power sector emissions. The power generation system will comfortably integrate all these electric vehicles, and the system benefits are even greater if most EVs charge flexibly. However, local distribution networks are likely to face challenges.
•Accelerated energy storage development can hasten the transition to a renewable power system, with significant benefits by 2030 including a 13% emissions reduction and 12% less fossil backup capacity needed.

Specific findings for Germany include:

•In Germany, adding flexibility supports coal through 2030, even as renewables grow to dominate the market. This counterintuitive finding is not due to a problem with batteries, EVs, demand response or interconnectors – cheap coal is the culprit. Flexible technologies are important because they can integrate inflexible generation – and in Germany’s case, its inexpensive lignite plants also benefit. To decarbonize, Germany needs to address existing coal generation while investing in renewables, flexibility and interconnection.
•Still, by 2040, adding more batteries, flexible electric vehicles and interconnections with the Nordics all enable greater renewable penetration and emissions savings. More flexible demand, on the other hand, reduces the need for battery investment.
•Even with coal-heavy power, adding EVs reduces transport emissions.

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For another year, Acciona has revalidated its position as the “greenest” electric power generation company in the world. It has held this position since 2015 in the “New Energy Top 100 Green Utilities” ranking of Energy Intelligence, an independent consultancy that specialises in energy markets.

The ranking, which has just been published in its seventh edition, selects a hundred of the best electricity generation companies in the world and classifies them based on their CO2 emissions and installed capacity in renewable technologies (excluding hydroelectric) to determine their level of involvement in the transition to a low-carbon electric power system.

Acciona continues to be the main pure player in renewables and stands in first place in the world ranking of the US-based firm. In its report, Energy Intelligence highlights the growing role that specialised renewables companies such as Acciona play in achieving an ever cleaner energy system worldwide.

The 100 companies that make up the ranking total 3,370 gigawatts (GW) and account for around 50% of electricity generation capacity in the world. European companies figure prominently in the Top 10, with five companies, together with three from China and two from the USA. After Acciona, the greenest utilities are China General Nuclear, Iberdrola (ES), E.On (AL), NextEra Energy (US), Invenergy (US), EDP (Portugal), China Energy Investment, Orsted (DK) y State Power Investment (Ch).

An analysis of the Top 100 Green Utilities of Energy Intelligence reveals, among other things, that the companies listed had CO2 emissions below 500 kg/MWh last year (precisely 495 kg/MWh, as opposed to 565 kg/MWh in 2011).

It also highlights that, in the seven years of the study, non-hydro renewables have almost tripled in the ranking, up to 299 GW (116 GW in 2011). In this respect, Energy Intelligence emphasizes the role played by European electricity companies that have undergone greater transformations in their generation assets, adding a total of 35 GW in wind and solar in that period and divested in fossil assets to the extent of 90 GW.

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Planned and designed at European level to be an incentive to the development of renewable energies, the Guarantee of Origin system begins to gain importance with the increase of its demand and its price. According to AleaSoft, the price of certificates will tend to rise and will be important in the development of new renewable projects.

Renewable energy producers can apply to the CNMC for a certificate of the energy generated. These certificates show that those kWh were generated from renewable energy sources. There are also Guarantees of Origin for high efficiency cogeneration. These certificates can be transferred to electricity retail companies so that they can justify to their customers the renewable origin of the energy supplied.

Guarantees of Origin were conceived as a tool to provide transparency and guarantee the origin of the electricity generated, and thus encourage the development of renewable technologies. Based on the European directive that mandated the states to ensure that “the origin of electricity produced from renewable energy sources can be guaranteed as such according to objective, transparent and non-discriminatory criteria”, each country of the European Union has regulated the issuance and transfer of Guarantee of Origin certificates.

In 2017, the CNMC issued Guarantees of Origin for 76,683 GWh from renewable sources and 1,803 GWh for high efficiency cogeneration, 81.2% of which were transferred to marketers to cover all or part of their retailed energy.

The mix of energy sources of each retailer will depend on the fraction of their energy covered with the certificates received. With the rest of the energy produced and not covered by Guarantees of Origin, the CNMC calculates a generic mix for the rest of the retailers.

In Spain, the issuance of Guarantees of Origin by the CNMC is free of charge, but the regulation does not allow renewable facilities that receive state subsidies to profit from their transfer. Consequently, in Spain the market of Guarantees of Origin has been traditionally unattractive and with prices of few cents of euro per MWh, very low compared with other European countries where the prices were around 0.20 ‑ 0.30 €/MWh. But this has been changing as there are more renewable plants to market without economic incentives and with the affiliation of the CNMC to the AIB (Association of Issuing Bodies) that manages the trade of Guarantees of Origin in Europe. According to AleaSoft, the Guarantees of Origin will have an important role as an incentive in the new renewable projects since their price will tend to increase in the coming years.

But not everybody thinks that the Guarantees of Origin system is perfect. Its detractors denounce that it is usually used in a deceptive way to confuse the consumer about the origin of the electricity that physically arrives at its meter. Since the issuance and acquisition of certificates does not influence the pool energy mix, which will only depend on the availability of renewable resources at each moment, it is implied that it does not encourage the installation of more renewable power.

What is certain is that the Guarantees of Origin provide transparency for the consumers that allows them to know the environmental impact associated with the energy consumed, and provides more resources to choose the retailer. In addition, for the market, it represents an indication of the demand that exists among consumers to be supplied with renewable energy. And we are not only talking about domestic consumers who are aware of climate change. Since major consumers of electricity such as Google, Facebook and Apple began to announce that they would work to make their electricity consumption 100% from renewable sources, a “green wave” worldwide is leading large companies to also propose a total green electricity consumption. And this “green wave” will continue to spread in cascade as these companies begin to also ask for green certifications to their suppliers. All this has already made the demand for Guarantees of Origin to grow and, consequently, also their price, which, according to AleaSoft, will continue to rise in the medium and long term.

For AleaSoft, the current scenario presents a future where Guarantees of Origin are going to play an important role in the Energy Transition, thanks to the new renewable projects to meet the emission reduction objectives and the increasingly widespread awareness of consumers and retailers about the environmental impact of electricity production.

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