"El éxito es aprender a ir de fracaso en fracaso sin perder el entusiasmo". Winston Churchill

sábado, 24 de septiembre de 2011

ESSAY: Europe's energy infrastructure


The development of a future low carbon economy in Europe is based on a new Europe’s energy infrastructure. Future low carbon economy in Europe relies on the achievements proposed by 2020. The well-known 20, 20, 20 objectives consist of an increase of the final energy consumption from renewable sources until 20%, a reduction of the greenhouse gas emissions by 20% and an increase of the energy efficiency by 20%. Moreover, Europe should ensure secuity of supply to its citizens at affordable prices against the increasing competitiveness of the word resources.

Previous bad experiences, such as the disruptions of gas in Eastern Europe or the impossibility to accommodate the electricity produced in the Northern Seas and Baltic areas or in Southern Europe pointed out the needs for investments in Europa energy infrastructure. In addition, the importance of the fossil fuels in the present and coming years due to the increase of the European population and increasing electricity demands confirm this necessity. (Comment 1)

The European energy infrastructure based on the electricity, gas and oil networks as well as in new technologies such as carbon capture and storage ones (Comment 2) should face several challenges in order to become more competitive and achieve the following objectives:

-          Decrease the costs towards low carbon economies
-          Ensure secure of supply to its citizens and help to stabilize the prices of fossil fuels
-          Ensure affordable energy prices
-          integrate the European networks with the neighboring networks.

In order to reach these objectives, some priorities are required depending on the network or technology under study. These priorities and challenges are discussed in the next sections.

Electricity grids
Electricity grids must be updated and modernized. They should be able to accommodate the increasing electricity demand (Comment 3) as well as the increasing electricity production from intermittant renewable sources. The electricity demand has an increasing trend due to the increasing number of appliances and technologies that rely on electricity as energy sources. Moreover, the increasing population (Comment 4) as well as the increasing life quality make that the overall electricity demand will be significantly higher in the coming years.

On the other hand, the fast increasing off-shore wind farmers in the Northern Sea Europa and Baltic area as well as the increasing production of renewable energy in Southern Europa should be successfully accommodate in the future electricity grid. These renewable sources are located far away from the center of consumption or storage (Comment 5)and therefore not only the absorption of the generated electricity but also an efficient transportation of this electricity will be key points.

The current antiquated electricity grid should become more flexible and well-interconnected in order to be suited o previous needs renewable energy. Moreover, the electricity grid should become smarter and include storage technologies. The development of smart grid needs of investments and research but it will allow consumers to consume the energy at lower prices and in a much efficient way. Smart grids will increase the competitive retail market as the electricity prices are expected to decrease, provide well functioning energy services, integrate the renewable energy generation and distribution with the electricity demand and allow new types of demands.
On the other hand, to ensure an efficient consumption of the renewable energy generated in the further locations in the centers of population, a new high-voltage long distance network and new storage electricity technologies are desirable. Providing the electricity grids with efficient high voltage long-distance networks the losses due to the transportation are significantly reduced and it will become more secure.
Consequently, the priorities that concern the electricity grid are the integration of the off-shore grid in Northern Sea, the improvement of the connections South/West Europe to accommodate the electricity coming from renewable sources, the improvement of the electricity grid located in the Baltic region and last but not least the development of smart grids.

Gas and oil grids
As commented previously, the increasing European population together with the increasing energy demand per capita point out that the importance of fossil fuels will not decrease in the next years. (Comment 6) For this reason, the necessity of well-interconnected networks for gas and oil is a priority.

Regarding natural gas, the dependence of Europe on Russia, north of Africa and other third countries will continue. At present, natural gas is provided by three main routes. Eastern Europe is provided by Russian natural gas, Western Europa by African natural gas while Nordic Countries have their own reserves. Due to bad experiences in the recent past, when some gas disruptions happened in Eastern Europe with dramatic effects on the overall European economy, one of the priorities related to gas grid is the diversification of the supplier. The diversification of the supplier can be achieved by including different kinds of natural gas, such as liquid natural gas and compressed natural gas, the construction of bi-directional pipelines (Comment 7) or the enhancement of storage capacities (Comment 8) of the gas grid.

The diversification of the gas suppliers implies the abolishment of the current monopolistic market, where each European region is supplied by only one supplier. The diversification will enhance the competitive between the suppliers decreasing the instabilities on the prices and the dependence of the gas prices on oil prices (Comment 9). This is one of the priorities for the coming years. However, it implies the construction of new and very well-interconnected pipelines in order to have at least two different suppliers for each European region and guarantee the gas supply from one region to another one.

Regarding the oil network, it would be desirable the supply of oil by pipelines. Oil pipelines will avoid the current vessel transportation of the oil by only one route and decrease enormously the possibility on environmental hazards. (Comment 10)

Carbon capture and storage
Finally, energy infrastructure includes new technologies that will help to reach the 2020 European objectives. Among the current technologies under development or pilot scale, those concerning carbon capture and storage should be considered. The CCS technologies will allow to continue using fossil fuel for electricity generation without emitting CO2. The technologies present risk and benefits that are still being testing through pilot plants.

Due to the fact that the potential CO2 storage sites are not well distributed across Europe (Comment 11) and the fact that some MS, considering their significant levels of CO2 emissions, have only limiting potential storage within their national boundaries, construction of EU pipeline infrastructure spanning across states border and in the maritime environment, where most of the CO2 reservoirs are planned,  become necessary.

Obstacles
Although the needs of constructing updated and well-interconnected networks of mainly electricity and natural gas but also of oil and CO2 are highlighted, there are some obstacles that should be overcome in advance.

The construction of pipelines and networks implies the necessity of investments. The evaluation of the investments required to renovate the obsolete energy infrastructure is usually evaluated by the regulators at national level while the impacts of their decisions on the EU internal market are at EU level and beyond. In this sense, the key infrastructure connection projects among the member states are taken at national level and thus tend not to approve the necessary rate of return and tend to be postponed or considered not of high importance. In this way, the evaluation of the benefits of the investment should not be limited to national level but consider the benefits and the returns that can bring across EU.

The strengthen and extended ETS where there will be a unified EU carbon market can help to shift the optimal electricity supply mix in favor of fossil fuels as they become low carbon supply sources. This fact will avoid the further development of the renewable energy sources as well as the development of the storage technologies in the electricity grids. Similarly the regulation on security gas supply will enhance the EUs capacity to react to crisis simulations but can also promote the dependence of EU to this fossil fuel.

Finally, the control of the systems of distribution of energy risks at espionage and terrorist attacks as well as political instabilities. The control of the energy distribution systems is done by IT. The protection of these systems and the investment on new technologies is unavoidable to protect citizens from environmental hazards and terrorist attacks as well as to ensure an efficient supply.

Conclusions
The update and modernization of the European energy infrastructure is a necessity to ensure the secure of energy supply to the citizens at affordable prices, a reduction of the cost of low carbon shift economies. These objectives will be achieved by a technical improvement of the present technologies, greater efficiencies and higher flexibility. The investments required in the energy infrastructure should be considered at EU level since their benefits are across the borders of the member states.

The investments required in the European energy infrastructure are both physical and related to the control and management. Both kinds of investments will have a great impact on the economy since energy is the foundation of the current economy, will allow the accomplishment of the 20-20-20 European objective, set up a low carbon economy. But, without any doubt, these investments ensure the secure of supply to citizens at affordable prices.

Regarding the electricity grid, the priorities are the development of well-interconnected and smarter networks and the integration of renewable sources as well as storage technologies to accommodate the increasing electricity demand.

Regarding the gas grid, the current priorities are the diversification of the suppliers, providing at least two suppliers to each European area, increase the flexibility requirements of LNG and CNG, provide Europe with bi-directional pipelines and enhance the storage capacities of the grid. These objectives will reduce the current monopolistic market and consequently increase the competition among the suppliers stabilizing gas prices independently from oil prices. The construction of an oil pipeline network will avoid the transport of this kind of fossil fuel by vessels on an only route and decreasing the environmental hazards.

Acknowledgment
The author thanks to P.D. for his fruitful comments and corrections and all the friends for all support, opinions and comments received. They have been carefully evaluated!!!!

Sources
- Energy infrastructure: priorities for 2020 and beyond A Blueprint for an integrated European energy network – DG Energy
- Notes from Bucharest summer university 2011. Notes taken after long party nights….
- Ideas that came to my mind during the three hours that took me to write this essay….

3 comentarios:

  1. Herewith the commens from P.D to whom I thank you not only for helping me to improv the essay but also for the coffee he paid!!! ;-))
    1. we are not sure if the current fossil fuel share is still increasing or starting decreasing... anyway, what is sure is that the total fossil fuel demand continues increasing
    2. CCS is still an unproven technology.. and with this simple sentences he knock my post-doc down..
    3. maybe the total demand could be decreasing becase of the energy efficiency... lthough I have my doubts... espcially concerning the building sector and which consumes around 40%...
    4. population in western Europe is decreaing already...
    5. storage at present is mainly on-site.
    6. in fac the last data reveal that the energy demand per capita is decreasing.... now a question raises: is it due to the financil crisis or to the 8h or more that Alicitas spends in front of the computer???
    7.non-convntional gas like in US
    8. gas storage is extremdly expensive
    9. Alredy starting to split prices on international markets, not locally
    10. but more expensive!! more pipelines also leak
    11. reltively better distribute tan fossil fuel resources... god sei danke! if not we have another problem dear P.D....

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  2. Sobre el gas natural: es cierto que el monopolio tiene problemas de eficiencia, sin embargo el gas lo tienen rusia, kazakhstan y libia y no se puede cultivar :) lo que hay que evitar es que el gran importador nacional (gdf en francia, eni en italia etc) sea el mismo que lo vende al pormenor. puesto que los contratos entre el importador y los productores son take-or-pay (me lo tienes que pagar hasta un monto para garantizarme contra las fluctaciones), eso permite al importador ser agresivo, así que hasta la enrtada de competidores en el mercado es inutil, porque el mercado termina segmentado (http://mpra.ub.uni-muenchen.de/5861/ la referencia teórica).

    lo que hay que hacer es contruir un mercado regulado entre importadores y pormenores, que por supuesto tendrá que ser algo como una bolsa a nivel europeo...

    muy interesante de todo

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  3. Energy infrastructure rules changed at last minute

    ENDS Europe
    Wednesday 19 October 2011

    Draft rules balancing the EU’s energy infrastructure needs against environmental protection were amended just days before the European Commission published its ‘connecting Europe’ package, ENDS has learnt.

    The energy part of the package, published on Wednesday, suggests the EU should spend €9.1bn of its central funds on new energy infrastructure by 2020 and make a series of changes to the permitting regime for critical, cross-border projects.

    ENDS understands the text was changed shortly before a meeting on Monday between environment and energy commissioners, Janez Potočnik and Günther Oettinger.

    An earlier draft, seen by ENDS last week, had a short list of the conditions under which energy infrastructure projects would supersede environmental protection laws, including a lack of suitable alternative routes and the completion of appropriate impact assessments.

    Provided these conditions were met, the draft said there was no need for the commission’s opinion to be sought.

    This list has been dropped from the new version, which says instead that existing rules on “overriding public interest” should apply. Where these rules require an opinion from the commission, this will be reached with the relevant member state, it says.

    Other key elements of the draft regulation remain largely unchanged, including the new, three-year deadline for approving key projects, rules requiring member states to nominate a single agency responsible for these approvals, and the 12 'priority corridors' considered to be in need of support.

    The latter include a North Sea wind farm grid, electricity links between Mediterranean countries for solar projects, gas pipelines connecting the EU to central Asia, and a cross-border carbon dioxide network for carbon capture and storage (CCS).

    Projects of common interest (PCIs) identified within each corridor are eligible for central funding and must be approved by the network of national agencies following minimum standards on transparency and public approval.

    The proposal has been welcomed by industry groups and NGOs keen to see more renewables brought online, but it is not clear how much funding will go to each technology. Some organisations are concerned gas pipeline projects will eat up the lion’s share and Greenpeace is worried about the impact of the CCS corridor.

    "Betting taxpayers’ money on unproven CCS technology to keep coal plants running is a mistake when proven clean alternatives exist,” said the group’s energy policy advisor Frauke Thies.

    EU sources suggested the commission could face some opposition to its plans to streamline permitting from member states such as Poland, Italy and potentially Germany, while the UK put out a statement welcoming the opportunity to diversify its gas supplies.

    * Members of the governing body of the International Energy Association (IEA) meeting in Paris earlier this week agreed to work towards a more diversified energy system in light of the Fukushima disaster and the political situation in Libya.

    The IEA’s ministerial chair, Australian minister Martin Ferguson, said its figures suggested $40 trillion would have to be invested in energy infrastructure improvements globally by 2035, two thirds of this in emerging economies.

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