E3MLab www.e3mlab.eu PRIMES Model How to Meet the EU's Greenhouse Gas Emission Targets 1 PRIMES modelling for the Winter Package By Professor Pantelis Capros, E3MLab central@e3mlab.eu 4 Sept. 2017
CLEAN ENERGY FOR ALL EUROPEANS announced in Nov. 30, 2016: Commission proposes new rules for consumer centered clean energy transition 2 • The Winter Package has been conceived using a set of targets and concrete bottom-up policy measures • The proposal mainly uses two policy scenarios, EUCO27 and EUCO30, based on the PRIMES model Increase of ETS linear factor to 2.2% for 2021-30 Policies ETS Market Stability Reserve RES-E policies: new guidelines for auctions Policies RES Policies for biofuels Support of RES in heating Energy efficiency of buildings: new EED, enhancement of article 7 Policies Efficiency More stringent eco-design Support of heat pumps Best available techniques in industry CO2 car standards (70-75gCO2/km in 2030, 25 in 2050) and for Vans (120 in 2030, 60 in 2050) Policies Transport Efficiency standards (1.5% increase per year) for trucks Measures improving the efficiency of the transport system 4 Sept. 2017
Scenarios quantified for the winter package using PRIMES 3 Effort Sharing Regulation EuCo33 (Impact Assessment in parallel to the winter package) EuCo 35 Energy Efficiency EuCo 40 (Impact Assessment) EuCo27 or EuCo30 and REF16 EuCo30 Res30 Reference Targets for 2030 Electricity and 2050 MDI Options Market 0,1,2,3 Design (Impact Capacity Assessment) Mechanisms RES CRA variants Directive for RES-E Low-emission mobility (Impact Assessment) strategy RES in H&C (Impact Assessment of a communication in parallel to the winter package) Biofuels 4 Sept. 2017
Storyline of EUCO scenarios 4 • The Targets are defined for 2030 but also for 2050 • The EUCOs are decarbonisation scenarios, compatible with a 2 o C global scenario and the EU INDC in Paris-2015 COP • ETS drives strong emission reduction in the power sector and mainly pushes development of RES which benefit from learning-by-doing requiring low or no out-of-the-market support • The reforms of the EU internal markets of electricity and gas enhance integration of balancing and competition, 2030 – 2050 supplemented by new interconnections • Deep decarbonisation of • Energy efficiency measures strongly reduce demand, the power sector including for electricity, but later electricity demand 2020 – 2030 • Transport sector electrification increases driven by electrification of transport and heat uses • Energy Efficiency • Heating: electrification and • Renewables • Transport undergoes significant emissions cutting through further efficiency • Power sector • Advanced Biofuels in some electrification of cars and LCVs and increased use of Decarbonisation transport sectors advanced biofuels in non-electrified transport modes • Infrastructure • Completion of Internal Market 4 Sept. 2017
Remaining GHG Emissions (EUCO) 5 Non-CO2 GHGs emissions Key GHG emissions in Mt CO2-eq Key GHG emissions in Mt CO2-eq • The energy related CO2 emissions Non-energy related CO2 6000 6000 decrease primarily in the energy emissions Supply of energy supply sectors, notably in the Transport power sector, but also in the 5000 5000 non-ETS Domestic sector demand sectors ETS Industry • The remaining non-abated 4000 4000 emissions by 2050 are the non- CO2 GHG, the residual use of oil 3000 3000 in transport and various small scale uses of gas in the domestic sector 2000 2000 and in industry • The reduction of emissions in ETS 1000 1000 are much higher than in non-ETS sectors 0 0 2005 2010 2015 2020 2025 2030 2035 2040 2045 2050 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 2050 4 Sept. 2017
Structure of Power Generation 6 The ETS prices drive profound transformation of power generation • Solid fuels strongly decline • Nuclear maintains a rather stable share • Gas has a significant share and plays an important balancing role in the system • Emergence of power-to-X storage systems in the long term reduces gas importance • Hydro power and biomass are stable • The variable RES (solar PV, wind onshore and offshore) is the strongly emerging power generation industry: • 30% of total in 2030 (50% all RES) • 50% in 2050 (65% all RES) 4 Sept. 2017
Structure of Capacity Expansion 7 • The investment requirements in gas-fired plants are significant mainly after 2025 and until 2050, in contrast to the continuous decrease in the rate of use • The investment in nuclear both for extension of lifetime and new plants is also significant • The investment outlook is dominated by the massive development of variable RES, notably wind and solar 4 Sept. 2017
Demand for Electricity 8 • Electricity consumption hardly increases until 2030. • The energy efficiency improvement drives electricity savings in the short/medium term, and energy savings overall • Transport electrification and increased use of electricity for heat purposes add significant load, but only after 2030 • In the long term, electricity produces clean gas (methane) and H2 through electrolysis and a chemical process 4 Sept. 2017
Indicators 9 • Electricity decarbonisation takes place well before 2050 to enable emissions cuts in other sectors • Electricity does not only decrease emissions in transport and heat sectors, but also by reducing the average emission factor of distributed methane (in the long term), serving storage purposes at the same time (Power-to-X). • CHP decline is mainly due to heat savings • The contribution of CCS is rather small 4 Sept. 2017
The Energy Efficiency pillar 10 Enablers: 1. Renovation of houses and buildings 2. Eco-design regulation 3. BAT in industry 4. Transport electrification and energy efficiency standards Based on cost- effectiveness analysis, EUCO30 is selected 4 Sept. 2017
The Energy Efficiency pillar 11 • Housing renovation is by Final energy consumption in the domestic Final energy consumption in industry of sector of the EU28 the EU28 assumption very intense until 550 320 2030 500 300 REF2016 REF2016 • The eco-design measures 450 280 EUCO27 EUCO27 400 EUCO30 EUCO30 reduce demand for electricity 260 350 EUCO33 EUCO33 240 • But new uses of electricity in 300 EUCO35 EUCO35 220 250 EUCO40 EUCO40 heating and transport sustain 200 200 2015 2020 2025 2030 2035 2040 2045 2050 2015 2020 2025 2030 2035 2040 2045 2050 growth of demand for Share of Electricity in Final Energy Final energy consumption in the transport electricity Consumption (%, EU28) sector of the EU28 • The efficiency policies show 380 40.0 38.0 significant results in transport 360 36.0 REF2016 REF2016 34.0 340 EUCO27 EUCO27 and industry over the entire 32.0 EUCO30 EUCO30 30.0 320 projection period 28.0 EUCO33 EUCO33 300 26.0 EUCO35 EUCO35 24.0 280 EUCO40 EUCO40 22.0 260 20.0 2015 2020 2025 2030 2035 2040 2045 2050 2015 2020 2025 2030 2035 2040 2045 2050 4 Sept. 2017
The RES Pillar 12 • Solar and wind deploying in the power Overall RES Share (%) RES-E share (%) sector are the main drivers of the increase 60.0 70.0 in the renewables 60.0 50.0 • Renewables in heating and cooling also 50.0 40.0 REF2016 REF2016 develop, albeit at a slower pace, driven 40.0 EUCO27 EUCO27 30.0 by heat pumps and RES-based production 30.0 EUCO30 EUCO30 20.0 EUCO30-RES30 EUCO30-RES30 of heat 20.0 10.0 10.0 • The biofuels in transport constitute the 0.0 0.0 main growing market for bioenergy, as 2010 2015 2020 2025 2030 2035 2040 2045 2050 2010 2015 2020 2025 2030 2035 2040 2045 2050 biofuels are essential for reducing RES-H&C share (%) RES-T share (%) emissions in non-electrified transport 45.0 180.0 segments (the RES-T includes for electricity 40.0 160.0 35.0 140.0 used in transport the RES used in power 30.0 120.0 REF2016 REF2016 sector) 25.0 100.0 EUCO27 EUCO27 20.0 80.0 EUCO30 EUCO30 15.0 60.0 EUCO30-RES30 EUCO30-RES30 Note: The EUCO30-RES30 variant was only 10.0 40.0 a sensitivity analysis 5.0 20.0 0.0 0.0 2010 2015 2020 2025 2030 2035 2040 2045 2050 2010 2015 2020 2025 2030 2035 2040 2045 2050 4 Sept. 2017
Developments in the transport sector 13 Share of advanced (mainly plug-in hybrid and pure • Advanced car technologies (mainly electric) car technologies in the EU28 car fleet plug-in hybrids and battery electric REF2016 EUCO27 EUCO30 80% vehicles) dominate the car market as 70% 60% a result of the CO 2 car standards, 50% 40% which continuously decrease 30% 20% 10% • The biofuels, mostly advanced 0% 2020 2025 2030 2035 2040 2045 2050 lignocellulose-based fungible biofuels Share of biofuels in total energy consumption in the in the long term, get a significant transport sector, EU28 REF2016 EUCO27 EUCO30 market share in the non-electrified 40% 35% segments of the transport sector 30% 25% (trucks, ships, aircrafts) 20% 15% 10% 5% 0% 2020 2025 2030 2035 2040 2045 2050 4 Sept. 2017
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