Further Drop in Energy Costs for German industry – new publication
In a first academic publication, experts have updated the estimation of overall energy costs for the German industry. Following this study published today by DIW and commissioned by the ECF, the energy costs per production unit fell by 22 percent between 2010 and July 2016. The study was conducted by Öko-Institut and DIW Berlin, and explains the methodology and the modelling allowing to estimate the first up-to-date energy cost index available for Germany. The index will be regularly updated by the ECF.
The German press release published at the launch of the new index is available for download here.
The Industrial Innovation for Competitiveness (i24c) initiative, powered by the European Climate Foundation, published on 26 May a report aimed at informing the European Commission’s forthcoming Energy Union Research, Innovation and Competitveness strategy.
The report assesses Europe’s performance when it comes to energy innovation and outlines how Europe could advance its Energy Union objectives while boosting its competitive advantage in the global economy, providing significant benefits to its citizens.
In February 2015 the principle of ‘Efficiency First’ (E1st) was formally endorsed by the European Commission within the framework of the Energy Union. Based on the input of experts from the Regulatory Assistance Project, E3G, ClientEarth, eceee, the Smart Energy Demand Coalition, CAN Europe, Friends of the Earth Europe, OpenExp and the European Climate Foundation, the briefing Efficiency First: A New Paradigm for the European Energy System – Driving Competitiveness, Energy Security and Decarbonisation through increased Energy Productivity sets out how the principle can help the Energy Union to deliver on these three goals, and the changes needed to the governance framework to make it work in practice.
This initiative has been welcomed by the European Commission’s Vice President for Energy Union, Maros Šefcovic, who has provided an introduction for the briefing.
The briefing is the result of an expert process convened by the European Climate Foundation during 2016.
More detail on those changes recommended for the governance framework are given in the second document, Governance for Efficiency First: “Plan, Finance and Deliver“ – ten near-term actions the European Commission should take to make Efficiency First a reality.
The European Climate Foundation has launched a new report, Oil Market Futures, which highlights the need for policymakers and investors to start planning for a world with significantly lower oil demand, and consequently lower crude oil prices. Just as the “Peak Oil” theory proved to be a mirage, Oil Market Futures throws into question previous assumptions of ever-increasing oil prices.
The study, available for download here, looks at oil prices under a scenario of concerted global action to tackle carbon emissions from transport. The results show that, in a world where climate policies are implemented to drive investment in low-carbon technologies, demand for oil from transport will be significantly reduced: by around 11 million barrels per day in 2030 and by 60 million barrels per day in 2050. This lower oil demand would result in oil prices stabilising between $83 and $87 per barrel in the long run, rather than increasing to $90 per barrel by 2030 and over $130 per barrel by 2050 in a business-as-usual high-carbon world.
The report was launched at the London Stock Exchange on April 20th, an event where Shadow Energy and Climate Change Minister Barry Gardiner MP warned that oil companies were taking unacceptable risks by planning for business-as-usual. In his keynote speech, Gardiner told the audience: “It is foolish – and reckless – to plan for business as usual. Yet that is what oil companies are doing. I now believe that it may indicate a pattern of deliberate misinformation to the public that will one day lead to a successful criminal prosecution against such companies similar to those we have seen in the tobacco industry.”
Around 80 representatives from the oil industry, the investor community, government and civil society gathered in the symbolic venue. Gardiner’s speech was followed by a debate on the “new normal of oil prices” between Professor Dieter Helm, E3G chairman Tom Burke and The Carbon Tracker Initiative’s CEO Anthony Hobley. At a second event in Brussels on April 26th, around 150 participants heard a panel debate on the implications for geopolitics and EU policy choices.
The study was conducted by a consortium of three consultants, Pöyry, the International Council on Clean Transportation (ICCT), and Cambridge Econometrics. Lead author Philip Summerton of Cambridge Econometrics explained: “In a world where climate policies are being implemented to drive investment in low-carbon technologies – as governments agreed in Paris – demand for oil will be curbed and, ultimately, reduced. This will have profound impacts for oil markets, but the economic advantages to oil consuming countries are clear and by moving early, the benefit can be maximised.”
ICCT Executive Director Drew Kodjak said: “We have seen how vehicle standards around the globe have already reduced oil demand, and with governments increasingly waking up to the imperative to tackle climate change, we can expect this trend to strengthen. Companies such as Tesla have shown what innovative engineers are capable of, and governments in California, Norway and the Netherlands have shown how rapidly change can be delivered via smart policies.”
The report received media coverage globally, as illustrated by this selected article from the Guardian.
An analysis of 17 Intended Nationally Determined Contributions (INDCs) commissioned by the Energy Transitions Commission (ETC) has shown that, despite a renewables revolution, more radical actions will be required to drive transition to zero-carbon energy systems and to keep global temperate rise well below 2°C. Both more rapid decarbonisation of energy supply and big improvements in energy productivity will be essential.
Lord Adair Turner, Chairman of the Energy Transitions Commission, said: “By the end of this century, we must ensure that 10-11 billion people have standards of living currently enjoyed by the richest 10%; but by 2050, energy-related CO2 emissions must be reduced by 70% from 2010 levels. To design the needed revolution in energy systems requires input from many different players – governments, incumbent fossil fuel companies, new technology challengers, investors and NGOs. The ETC will bring together these different players, who often start with different points of view, but are united in their commitment that global warming must be limited to well below 2°C.“
The ETC commissioned Ecofys to analyse the INDCs of 16 countries and one region (EU 28) that together account for 78% of global energy-related carbon-dioxide emissions today. To gather sufficient data the INDCs as well as secondary sources were used; primarily laws, programmes and measures mentioned in the INDC and data developed by other organisations who have also attempted to assess the meaning and impact of these INDCs.
The ETC has been established to accelerate the transition towards low-carbon energy systems that can ensure the well below 2°C target is achieved while enabling robust economic development.
CPI study shows that policymakers need to maintain a mix of investors and address market design issues to attract the investment needed to reach renewable deployment targets cost-effectively.
More than 30 billion euros a year could be available for investment in the expansion of renewable energy capacity in Germany — more than twice the amount required to finance the addition of 7.4 GW of new solar PV and wind capacity per year to 2020 — as long as the country shifts policy effectively to deal with the next phase of the energy transition. So shows analysis in a new report from Climate Policy Initiative (CPI) carried out with support from the European Climate Foundation.
Based on extensive analysis conducted by the Artelys, ElementEnergy and Climact, and overseen by a consortium of organisations including E3G, Cambridge Institute for Sustainable Leadership, Agora Energiewende, WWF, RAP and the European Climate Foundation, the study looks at which infrastructure investments are lowest risk and regret to ensure resilience throughout the transition, and whether an integrated view on infrastructure (gas, power, buildings) can help meet security of supply challenges at a lower cost. It finds that, overall, the existing gas infrastructure in Europe is resilient to a wide range of demand projections and supply disruptions. In places where gas security of supply concerns do occur, the report shows that an integrated, regional approach that looks at gas, electricity and buildings together, can help meet these challenges at significantly lower costs.
Energy Union Choices builds on the widely referenced Roadmap 2050 series, and provides a new perspective on the infrastructure priorities for the European energy transition looking at gas and electricity systems together.
Based on extensive analysis conducted by the Artelys, ElementEnergy and Climact and overseen by a consortium of organisations including E3G, Cambridge Institute for Sustainable Leadership, Agora Energiewende, WWF, RAP and the European Climate Foundation, the study seeks to answer the question:
Which infrastructure investments are lowest risk and regret to ensure resilience throughout the transition? Can an integrated view on infrastructure (gas, power, buildings) help meet security of supply challenges at a lower cost?
The report shows that, overall, the existing gas infrastructure in Europe is resilient to a wide range of demand projections and supply disruptions. In places where gas security of supply concerns do occur, the report finds that an integrated, regional approach that looks at gas, electricity and buildings together, can help meet these challenges at significantly lower costs.
A high-level expert panel will discuss the report’s findings, its near-term policy implications at the EU and national level and the political challenges that need to be addressed to enable a cost-effective energy transition.
The ECF has commissioned Ricardo to help identify which policy measures can most effectively reduce CO2 from transport by 2030, in the context of the EU discussion of the 30% CO2 reduction required under the 2030 climate goals. Ricardo has done this by modelling a series of plausible scenarios in its SULTAN framework, a tool that was originally developed for the European Commission to help with its own policy development. While by necessity fairly high level, the results give a good indication of which approaches are more or less effective. The key findings are summarised below (all are compared to the relevant 2005 baseline):
A “high ambition” scenario of EU CO2 standards for cars, vans and trucks could reduce transport CO2 by 29% in 2030, almost achieving transport’s share of the EU’s 30% Effort Sharing goal.
The “EU-level policies” scenario (central ambition CO2 standards for cars, vans and trucks, plus a small increase in biofuels from waste) achieves a 28% CO2 reduction by 2030, almost achieving transport’s share of the EU’s 30% Effort Sharing goal.
The “low-ambition mixed” scenario, which combines unambitious vehicle standards with a mix of softer measures, achieves only a 23% CO2 reduction by 2030.
Implementing the “all options” scenario, which combines EU and national policies, would achieve a 40% CO2 reduction, exceeding transport’s share of the 2030 ESD goal.
The Industrial Innovation for Competitiveness (i24c) platform publishes today its first Memo on the potential for innovation in the construction value chain, which is one of Europe’s key industries. Titled Scaling Up Innovation in the Construction Value Chain Combining Value Creation and Climate Ambition in one of Europe’s Key Industries, the memo builds on work undertaken by the Buildings Performance Institute Europe (BPIE). It outlines how transformative innovation in the construction value chain can be leveraged to deliver both climate benefits after COP21 and economic gains. To deliver on this potential, policy has a key role to play especially to enable the emergence of challenge-driven innovation ecosystems involving all actors of the value chain.
i24c is powered by the European Climate Foundation.