This article is part of our special report Decarbonising Europe’s heating sector.
Achieving climate neutrality by 2050 requires decarbonising the whole economy, including the energy-hungry heating sector, says Finland’s Riku Huttunen. And that will involve cooperation at all levels of government, including local and EU authorities, he argues.
Riku Huttunen is the director-general for energy at the Ministry of Economic Affairs and Employment in Finland, which currently holds the EU’s six-month rotating Presidency. He answered in writing to questions from EURACTIV.
Heating represents almost half (40%) of the EU’s total energy consumption. As such, it is also responsible for a large share of greenhouse gas emissions. Yet, politicians seem reluctant to confront the issue head-on. Why is that?
First of all, I want to underline that the Finnish Presidency aims at advancing the EU discussions to set a clear vision of climate-neutral EU by 2050. To achieve this kind of ambitious target, we need to decarbonise the whole economy, including heating.
When it comes to heating, you are right, it is often forgotten or overlooked compared to electricity supply. One reason might be that heating is considered a local or regional solution.
However, thinking about market rules and the Emissions Trading Scheme, this is far from being just a local issue. It is the responsibility of national and EU policymakers to implement policies and measures valid for the heating sector in different operating environments in Europe.
EU policies relevant for heating should enable decarbonisation and deployment of innovative energy technologies while avoiding technological lock-ins in the heating sector.
Some policymakers seem to assume the problem will solve itself upstream, once the entire energy system will have switched to renewables – whether electricity or gas. Would that indeed be a desirable outcome?
Some key principles are important, one of them being technology neutrality. Another is sector integration, or sector coupling.
If we follow these principles and concepts, we must not define too precisely beforehand which technologies and energy systems will be the winners. It is crucial to work in a systemic way and to avoid excluding eligible solutions. We are going to need them all when decarbonising our economies, including district heating.
The EU has agreed a target to increase renewables in heating and cooling by 1.3% every year starting in 2021. Will that be enough to decarbonise the entire heating system by 2050?
It is a good start. Actually, the obligation expires when a member state has reached a 60% share of renewables in heating and cooling. Anyhow, it is a tool to ensure progress in the transition.
Fossil fuels – oil, gas, and coal – cover around 75% of the demand in the heating sector in Europe. So how fast can we get this number down to zero? Are there any obvious decarbonisation pathways to get to net-zero emissions by 2050?
There are definitely some challenges in decarbonising the heating sector. The EU Community should collaborate, also through Public-Private Partnerships, to find and develop good, sustainable and cost-effective heating and cooling solutions for our citizens.
In the long run, one pathway could be to electrify the heating sector. But technology is not the only thing needed. For example, individual building owners often lack both knowledge and financing to carry out the transition. Reasonable funding sources and dissemination of good practices can be important tools in this regard.
Some experts have called for a complete ban on new individual oil and gas boilers as of 2030, for instance. Do you think that would be a good idea? Is that an objective that should be set at the EU level?
Well, a ban can sometimes be a solution, but it can also be very expensive for stakeholders and citizens. I would therefore focus on careful analysis of different kinds of policy measures and choose those which provide cost-effective and socially feasible results.
However, it is clear that we can’t go on investing in fossil solutions forever.
The battle to decarbonise heating is sometimes depicted as a duel between renewable electricity and gas. But can the two actually work together? How does district heating fit in this context?
Actually, district heating can play an important role in the energy transition. District heating can provide additional flexibility to the system. It can also be a cost-efficient solution and enabler of sector integration.
For example, heat pumps in district heating networks can enable usage of renewable electricity. When there is cheap wind or solar power available, it can be stored in a heat storage site (a water tank, or an underground cavern for instance).
District heating, electricity and gas sectors can interplay in many ways, and we really need that. When new heat energy sources become available, it is cheaper to integrate them to the district heating system rather than to all buildings individually.
Finland is one of the European leaders on district heating. What could other European countries learn from Finland’s experience? Are there any basic do’s and don’ts? What are Finland’s future plans for district heating?
Yes, we are one of the leaders, not just in Europe but also globally. The Finnish approach is market-based without heat price regulation and without specific competition policy rules on heat markets.
District heating competes with individual heating, like ground source heat pumps and biomass boilers. The state is ensuring a fair playing field, but in the end, customers are free to choose or change their heating source.
Thermal networks in Europe are still largely reliant on coal (25%) and gas (30-40%) while renewables make up only 20% of the energy input, chiefly biomass. How fast can decarbonisation happen there?
Smart energy systems and sector integration can boost decarbonisation faster than we imagine. Deploying sustainable bioenergy where possible and combining that with industrial-scale heat pumps and waste heat solutions in district heating networks can do the trick. However, the task is not easy and we need to work in a determined way to be successful. Another crucial issue is to put the customer at the centre and help them optimise their energy usage.
Kadri Simson, the EU’s incoming energy Commissioner, has been tasked with facilitating the integration of the electricity, heating, transport and industry sectors – sometimes referred to as ‘sector coupling’ or ‘sector integration’ in EU jargon. How could this work from the point of view of the heating sector?
What an excellent question! We need additional flexibility in our energy system to deploy clean energy across the economy.
By better integrating the energy systems – for example, electricity and heating sector –, we can reduce emissions in a cost-efficient way. The issue of smart sector integration was also discussed by the EU energy ministers at the Energy Council meeting on 24 September.
Energy technologies and sector integration as an essential part of the new energy system are high on our Presidency agenda.
[Edited by Zoran Radosavljevic]