Energy-system modelling of the EU strategy towards climate-neutrality☆
Introduction
In the context of the COP21 meeting in Paris in December 2015, the European Union committed itself1 to limit GHG emissions as low as required to stay below a 2 °C rise in average global temperature. The EU has recently adopted (proposed by the European Commission in November 2016) an ambitious policy package entitled “Clean Energy for all Europeans”.2 The adopted climate and energy targets include GHG emission reductions (40% less than 1990 levels), energy efficiency (32.5% less primary and final energy than projected in 2007 before the economic crisis) and renewable energy (32% as a share of gross final energy consumption) in the year 2030. The policy measures include several sectoral Directives for energy efficiency, renewables and the electricity market, as well as a reform of the Emission Trading Scheme (ETS),3 enhanced by the recent adoption of the Market Stability Reserve (MSR),4 which has already led to a significant rise in the prices of CO2 emission allowances.
The EU has repeatedly confirmed its commitment to GHG emissions reduction of at least 80% by 2050, below 1990 levels. The Paris Agreement, on the other hand, mentions explicitly that best efforts should be made to limit the global temperature rise to 1.5 °C, with net zero GHG emissions in the second half of this century, that is, much earlier than considered for the 2 °C strategy (see Rogelj et al., 2015; Rogelj et al., 2018; Kriegler et al., 2018; van Vuuren et al., 2018). For this purpose, the European Commission proposed in November 2018 a long-term strategy, which includes scenarios targeting emissions reduction in 2050 at 95% GHG and more. Therefore, possible ways to reach net climate-neutrality in the EU energy system came up on the policy agenda.
Given the abovementioned considerations, a series of questions arise that this paper seeks to address:
Can the 2030 climate and energy framework deliver a decarbonised economy in the long term?
Is climate-neutrality by 2050 in the EU viable and sustainable in the long run?
Is it possible to reach carbon-neutrality solely with conventional fuels and technologies?
If not, what elements to promote in addition to conventional policies and technologies?
Is carbon-neutrality affordable?
We provide answers to the questions drawing from the PRIMES model5 results for a large number of scenario projections of the EU energy system quantified up to 2070. The projections formed part of the analytical material6 prepared by the authors to inform the European Commission's long-term strategy entitled “A Clean Planet for All”, released in November 2018.7
The views reflected in this paper are solely the ones of the authors. Moreover, the figures presented in the paper might slightly differ from the results published by the EC in the in-depth report accompanying the “A Clean Planet for All” communication.
Section 2 presents the concepts and data sources regarding the literature, while section 3 showcases the methodological approach. Section 4 presents the quantitative results and section 5 concludes the paper.
Section snippets
Concepts, data sources and review of literature
“Climate-neutrality” is equivalent to the net phase-out of all GHG emissions (Höhne et al., 2015). “GHG-neutrality” (net) has the same meaning, although it is more specific than climate-neutrality. “Carbon neutrality” (net) is a similar concept but only for CO2 emissions. Climate-neutrality of a fuel or energy vector implies net zero GHG emissions over its entire lifecycle, considering that carbon sinks are naturally occurring during the formation of the raw feedstock used for its production.
Methodology
Modelling how the EU energy system can reach climate neutrality is challenging research. We had to enhance the modelling framework and the underlying data considerably, and also extend the time horizon until 2070. The model enhancements concerned both demand and supply modules. An overview of the main enhancements includes:
An extension of the industrial energy demand module to include direct uses of hydrogen in high-temperature applications (e.g. iron and steel for direct reduction of iron ore)
Can the 2030 climate and energy framework deliver a decarbonised economy in the long term?
To answer this question, we have developed a Baseline scenario which assumes full implementation of the EU energy and climate policy package for 2030, but no additional measures after 2030. We assume that the EU-ETS, enhanced by the market stability reserve regulation, continuous conveying high carbon price signals to the sectors subject to ETS, such as power generation. As a consequence, power generation decarbonises considerably.
However, despite the trends in the power sector after 2030, GHG
If not, what additional elements to promote in addition to conventional policies and technologies?
Based on a post-analysis of the scenario outcomes and the consulted literature, we classify the possible decarbonisation policy options considered in the analysis into two categories, as shown in Table 3. The “no-regret” category includes options that already exist in the 2030 climate and energy policy packages, should be upscaled in the period after 2030 and will unavoidably hold a significant role in the long-term transition; their presence was evident in all scenarios modelled. On the other
Conclusions
The quantitative analysis undertaken through the model confirmed that the decarbonisation of the EU economy by mid-century is viable both technically and economically, regardless of the ambition level (limit temperature increases to well below 2 °C or 1.5 °C compared to pre-industrial levels); the pursuit of a sustainable climate-neutral EU economy by 2050 is a plausible target. It has also confirmed the “no-regret” character of actions focusing, among others, on efficiency improvements –
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The authors acknowledge funding by the European Commission (EC) and declare that the paper reflects strictly personal opinions and may not represent the EC official position.