Electricity sector eyes boom with cars set to lead switch from fossil fuel to green power

A rainbow rises up beside a wind turbine and a pylon above a snow-covered landscape near Bernbach, Germany. [Karl-Josef Hildenbrand/ EPA]

Europe will have to dramatically increase its electricity use if it is to stand any chance of achieving UN climate change mitigation goals agreed in Paris in 2015, the trade association Eurelectric argues in a report published on Wednesday (19 April).

With electric cars entering the mainstream, the transport sector is set to be at the forefront of this “decarbonisation”, participants at a launch event in Brussels said.

As negotiations over proposals for a root and branch reform of Europe’s energy landscape get underway, speakers at the event also highlighted huge potential to switch from fossil fuels to electricity in areas such as domestic heating.

Moreover, Eurelectric called for changes that would support unfettered consumption of renewable power by freeing it from limitations imposed through rules on energy efficiency.

Eurelectric’s secretary general Kristian Ruby said that with 56% of Europe’s electricity – the part derived from renewable sources or nuclear – already carbon free, average CO2 emissions from running an electric car are around 50g per kilometre, well below the EU’s 2021 target for cars in general of an average 95g.

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Zero-emission vehicles

At a press conference, he called for stricter emissions limits and targets for the uptake of zero-emission cars. It was also essential to roll out charging infrastructure, he added.

The widespread uptake of electric vehicles could prove a boon for the electricity sector, driving a large increase in overall consumption.

The CEO of the Swedish utility Vattenfall, Magnus Hall, said transportation in his country would consume roughly 12 to 15 terawatt hours of electricity a year if fully electrified. “That would be about a 10% increase of the total Swedish consumption,” he said. “Of course, that might take some time,” he acknowledged.

In an interview on the sidelines of the industry event, Hall told EURACTIV he was convinced the electrification of Europe’s energy system would be led by increasing demand for electric vehicles.

Vattenfall CEO: Decarbonising electricity can boost its use for transport, heating and cooling

Europe should accelerate the decarbonisation of electricity in order to encourage its use for transportation and other sectors. The end game is a fossil free system where we could use a lot more green electricity, Vattenfall CEO Magnus Hall told EURACTIV.com.

Vattenfall is investing heavily in the sector, with 6,000 charging points installed in Germany, Sweden and the Netherlands, and having recently announced it would replace its entire fleet of 3,500 vehicles with electric models. “I truly believe that transport is the thing we will see most of in the coming five years.

Eurelectric’s current estimate for the potential increase in electricity demand in Europe as a whole is rather higher than Vattenfall’s, Ruby said. “If we were to electrify all transport, put an electric motor instead of every single combustion engine, we would get an increase in power demand of 25%,” he said.

In addition to policy moves to promote e-vehicles, utilities want another legislative change that could boost electricity consumption. Ruby called for energy efficiency rules to be designed in a way that would “save high carbon energy rather than saving green electricity”.

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The green energy conundrum

Current legislation works on the assumption that electricity is an inherently inefficient way of transferring energy, and behind each unit of electricity generated is a primary energy consumption that is higher by a factor of 2.5. “We strongly believe we should have a differentiation on the primary energy factor for different types of generation,” Ruby told reporters.

“It doesn’t make sense to invest as a society in huge amounts of green electricity…and then go and save that same energy that we’ve just subsidised to produce,” Ruby added. The primary energy factor (PEF) for nuclear should be 1, Eurelectric argues in its report, while in the case of power derived from wind, solar and other renewable sources, it should be zero.

That would effectively exempt green electricity from contributing towards EU energy efficiency goals, which could – assuming a suitable policy framework and the necessary huge investment in infrastructure – in turn help increase electricity use in another potential growth area: the heating and cooling of buildings.

However, the European Commission favours a less radical revision of the PEF in its proposed reform of the energy efficiency directive.

“The proposed lower value — 2.0 rather than 2.5 — reflects the growing role of renewable sources of energy (RES) in electricity generation,” EU Commissioner for Climate Action and Energy Miguel Arias Cañete wrote in February in reply to a question from Danish social democrat MEP Jeppe Kofod.

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The EU executive’s reasoning suggests it is far from sharing Eurelectric’s standpoint on the issue. Cañete explained the underlying assumption for renewable power was that “one unit of primary energy from [wind or solar] gives one unit of electricity” – thus the PEF is 1. Moreover, the Commission sees nuclear as even less efficient than fossil fuels in terms of energy expended to generate electricity, giving it a PEF of 3.

The status of renewable power in relation to energy efficiency rules is not the only obstacle to the more widespread uptake of electrical heating that Eurelectric is pushing for.

Negative perceptions that using electricity to warm homes and businesses is wasteful must be changed, said Sean O’Driscoll, president of the heating appliance manufacturer Glen Dimplex, a sponsor of the Eurelectric event.

Eurogas chief: Gas can be renewable energy, too

The mobility sector will be a mix of electric- and gas-fuelled vehicles, Eurogas President Klaus Schäfer told EURACTIV Slovakia.

“There isn’t a technology in the heating sector that is as efficient as heat pumps, and yet with the exception of one or two countries, it doesn’t have a mass market presence,” he said.

“It’s about regulation, and the difference between good regulation and bad regulation,” O’Driscoll said. As a model, he cited Denmark, where fossil fuel based heating systems have been prohibited in all new buildings since 2013. French households could reduce their emissions by 15-20% by switching to electric heating, said Thierry Boucher, executive vice-president at EDF R&D.

This “carbon intensity” of electricity generation is far below the EU average of 279.5g (according to data from the EU’s number crunching department Eurostat) thanks to an overwhelming reliance on nuclear power.

Eurelectric’s push for electrification came two weeks after the lobby group announced utilities in all but two countries had committed to cease building coal plants from 2020 onwards.

“A largely decentralised and decarbonised electricity system is around the corner,” the EU’s director-general for climate action Jos Delbeke said at the launch event this week, while reiterating the Commission’s commitment to a “cost-effective, market-based” approach to decarbonisation.

The speed at which that corner is turned will largely depend on the outcome of ongoing negotiations in the European Parliament and among national governments over the raft of legislative proposals the EU executive tabled in November.