EUROPE FORESEES 2050 & 100% NEW ENERGY

RE-thinking 2050; A 100% Renewable Energy Vision for the European Union
April 20, 2010 (European Renewable Energy Council)

THE POINT
“We do not inherit the Earth from our ancestors: we borrow it from our children,” goes a Native American proverb quoted by environmentalist David Brower.

By the middle of this century, the children and grandchildren of today’s decision makers will be collecting on the loan. Will they get full payment?

Leaders in Europe are planning to pay off with interest. They want to not only leave the environment of the Earth much they way they found it, they want to turn over a New Energy economy that will sustain the people of Earth until the planet itself asks for something else.

As RE-thinking 2050; A 100% Renewable Energy Vision for the European Union, from the European Renewable Energy Council (EREC), makes clear, it is no small undertaking. Despite the ambitious programs the EU has begun, including its “Triple 20” goals for 2020 of obtaining 20% of its power from New Energy (NE) sources, cutting its greenhouse gas emissions (GhGs) 20% and improving its Energy Efficiency (EE) 20%, it remains reliant on largely imported fossil fuels.

The EU presently imports 55% of its energy and with business-as-usual will import 84% of its natural gas, 59% of its coal and 94% of its oil in 2030. This dependence on imported fossil fuels now costs each EU citizen an estimated €700 per year and that burden will be even greater in 2030.

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RE-thinking 2050 demonstrates, as have other studies before it (see NEW ENERGY AND THE LONG RUN), that a transition to 100% New Energy by 2050 is not only technologically feasible but will secure the EU’s energy supply, boost the EU economy and grow EU jobs.

What makes such a transition feasible is a long term, methodical approach. Moving to 100% New Energy could be done in a decade or two only by a massive mobilization. A patient, determined transformation over 3 or 4 decades to a New Energy economy requires only the determination to seize an obvious opportunity in a world urgently in need of emissions-free New Energy, Energy Efficiency, economic opportunity and energy security.

The EREC acknowledges that the choices on a 40-year pathway are many and the certainties in looking 40 years ahead are few. Its paper is an attempt to define a vision not a detailed set of unalterable actions. It can at best make estimates of things like economic growth, fossil fuel prices and future energy demand. But making an effort to anticipate what lies ahead is the best way to inform choices made today.

Conservatives the world over continue to scream out their lack of imagination by clamoring for a more-of-the-same energy policy of fossil foolishness, GhG-spew and dependence on energies marketed by societies wed to medieval and oligarchic values. They call for greater dependence on “clean” energy sources that generate toxic spew and radioactive waste for which the best solution so far is an animal-like burying of it in a hole in the ground.

That is simply not the best this generation can bequeath. A decade ago it might have been possible to argue that the New Energies and Energy Efficiency were a too expensive choice and would impede the growth of tomorrow's wealth. Now it is clear the New Energies and Energy Efficiency ARE tomorrow's wealth. Refusing to commit to them is a refusal to build the next generation’s future.

The post-World War II Baby Boomers owe their heirs a healthfully breathing world and the New Energy economy that will nurture it.

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THE DETAILS
Renewable Energy Sources and Technologies
(1) The New Energy options for electricity generation: (a) Onshore and offshore wind, (b) small and large hydropower, (c) solar PV and concentrating solar power, (d) wave, tidal, current, thermal and osmotic ocean energy, (e) conventional, enhanced and other geothermal energy, (f) biomass and biogas bioenergies.
(2) The New Energy options for heating and cooling: (a) Solar thermal, (b) direct use and ground source heat pump geothermal, and (c) biomass and biogas bioenergies.
(3) The New Energy options for non-electric heavy transport: Bioethanol, biodiesel and biogas bioenergies.

Current Status of Renewable Energy in the EU
(1) New Energy (NE) has been growing about 1.3% per year for the last 4 years and, at the end of 2009, NE provided more than 10% of the EU’s energy consumption, met 25% of all EU emissions cuts, provided 550,000+ high quality jobs, and had revenues of €70+ billion.
(2) Since 2008, NE has been over half of all new power generation built in the EU. In 2008, it was 57% and it was 62% in 2009. In both of the last 2 years, NE was Europe's biggest energy investment.
(3) At its present rate of growth, NE will by 2020 supply at least 18% of EU energy consumption, 2+ million jobs and generate revenues of “several hundred billion euros.”
(4) NE also was responsible cutting EU GhGs 7% from 1990 levels in 2009.

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General Approach and Definition of Potentials
(1) The highest potential is the theoretical level. The technical potential is lower because it accounts for limitations like efficiencies, available land or raw materials. The economic potential is the part of the technical potential that can be harvested at economically feasible rates.
(2)The “RE-thinking” paper assumes a CO2 price of 41 €/tonne (metric tonne) CO2 in 2020, 45 €/t CO2 in 2030 and 100 €/t CO2 in 2050. It assumes oil prices of $100 per barrel in 2020 and $120 in 2030 rising to $200 per barrel in 2050. Its demand and supply assumptions are for the EU-27 nations only.

Renewable Energy Sources’ Contribution to Final Energy Consumption
(1) The development of 100% New Energy depends on the aggressive deployment of Energy Efficiency, the building of a pan-European smart grid and the development of an EU-wide electricity marketplace.
(2) The plan foresees the building of 336 gigawatts of New Energy power capacity by 2020, a 14% growth that would creat a total of 521.5 gigawatts NE capacity in wind, hydro, PV, biomass, geothermal, CSP and ocean energies. It would be 34% of EU generation capacity in 2020. NE capacity would grow to 965.2 gigawatts in 2030 and be 65-to-67% of EU capacity. It would be 1,956 gigawatts in 2050 and meet 100% of EU needs.
(3)NE overall would grow 8.5% per year and a total of 46% between 2020 and 2030. Geothermal would grow 44% per year, ocean energy would grow 24% and CSP would grow 19% in the same period. PV would grow 16%, wind would grow 6% and hydropower and biomass would grow 2%. PV, wind and hydropower would be the biggest portions of total capacity.

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Renewable Heating and Cooling up to 2050
(1) Heating and cooling requires 49% of all EU energy. NE presently meets 10% of that demand.
(2) Solar thermal, geothermal and biomass energies make up the bulk of the NE supply for heating and cooling. By 2030, solar thermal will be 20% of the NE share of heating and cooling, and geothermal will be 10%. By 2050, the combined heating and cooling supplied by solar thermal and geothermal will be greater than that supplied by biomass.
(3) NE will be almost 30% of heating and cooling in 2020 and 52-to-57% by 2030. By 2050, NE will provide 100% of EU heating and cooling needs.

Renewable Transport up to 2050
(1) EU transport is presently 98% dependent on oil. It is the EU's fastest growing source of GhGs and, therefore, the energy sector most in need of a transition.
(2) Biofuels are expected to grow 5 times over by 2020, nearly 7 times present levels by 2030 and 11 times present levels by 2050. Their main use will be in heavy transport.

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Economic, Environmental and Social Benefits
Dependence on imported fossil fuels is estimated to cost the EU-27 €350 billion, an estimated €700 per EU citizen per year. Supply disruptions would entail further political and socio-economic risks. Based on best assumptions of volatile fuel prices, the paper concludes NE would avoid fossil fuel costs in 2020 of ~€158 billion, €325 billion in 2030 and ~€1,090 billion (€1+ trillion!) in 2050.

This does not include the health and environmental costs of air pollution. It also does not include the avoided costs of dealing with the worst impacts of global climate change.

Getting to 100% NE by 2050 will require significant capital investment. By 2020, the investment is estimated to likely be €963 billion. From 2020 to 2030, investment will be ~€162 billion and reach ~€1,620 billion. From 2030 to 2050, it will grow €140 billion per year and likely reach €2,800+ billion. These costs will, however, be more than offset by avoided CO2 costs.

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An installed unit of NE will deliver beyond the year it is installed. Additional cumulative capital requirements will therefore increase from ~€660 billion in 2030 to €1,180+ billion in 2050.

At the assumed prices for CO2, the value of avoided emissions in 2020 would be ~€492, €900 billion in 2030 and €3,800 billion (€3.8 trillion!) in 2050.

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The paper uses job creation as a measure of the social benefits of moving the EU to NE. At the end of 2009, NE employed 550,000 people in the EU. At the projected rates of growth, it will employ 2.7 million people in 2020, ~4.4 million in 2030 and ~6.1 million in 2050. This is a yearly gross employment growth rate of 30%-to-36%.

It also uses the number of EU citizens supplied by NE as a measure of NE's social benefit. EU population will grow from 500 million to 514 million in 2020 and 520 million in 2030 and then drop back to 515 million in 2050. In 2009, NE was available for 50 million Europeans. It will be available to ~130 million in 2020, 218+ million in 2030 and to every EU citizen in 2050.

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Policy Recommendations
The guiding principles for getting to 100% NE by 2050:
(1) Focusing all of EU policy to support the transition;
(2) An aggressive implementation of Energy Efficiency;
(3) Effectively implementing the 2009 RES Directive (Triple 20) in all EU-27 Member States;
(4) Setting higher and binding NE targets for 2030;
(5) Opening up a pan-EU energy market;
(6) Phasing out all fossil and nuclear energy subsidies and implementing an EU-wide carbon tax;
(7) Building a trans-EU smart SuperGrid;
(8) Building hybrid energy solutions like combined heat and power projects and virtual power plants made up of natural and man-made distributed energy storage;
(9) Aggressive implementation of NE for heating and cooling.
(10) Facilitating the use of transport solutions from next-gen bioenergy fuels like algae to electric vehicles;
(11) Supporting a Smart-Energy Cities 2050 initiative; and
(12) Creating regulations and standards to implement a Smart-Energy Buildings 2050 program.

The European Renewable Energy Council (EREC) is an organization of EU NE industry, trade and research associations representing revenues of €70+ billion and 550,000+ employees.

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QUOTES
- Didier Houssin, Director of Energy Markets and Security Directorate, International Energy Agency (IEA): “Realising these ambitious goals will be difficult. Technical challenges will need to be overcome. The technologies also need to become progressively more cost competitive. To ensure large scale investment and deployment in the electricity, heating and cooling and transport sectors, the required policy framework needs to be developed and implemented, including appropriate financial incentives and measures to tackle the other non economic barriers. Furthermore, the physical infrastructure will need to be adapted…”

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- Prof. Arthouros Zervos, President, EREC: “Europe’s current energy system is confronted with a number of uncertainties: unpredictable and highly volatile fossil fuel prices and the resulting economic challenges, geopolitical risks related to import dependency, and the harmful environmental consequences of fossil fuel based energy generation. However, what remains certain, is that if we continue on the energy pathway of the last few decades, climate change will have a more and more unpredictable and disastrous impact on our lives, our energy import dependency will rise, and fossil fuels will become scarcer and concentrated in a few countries around the world. Inertia is not a solution…The answer to these challenges is not beyond our reach, the solution, in fact, lies in our hands and with it our ability to change the future. By switching from fossil fuel, greenhouse gas intensive sources of energy to renewable sources of energy, Europe is able to fully grasp its sustainable potential - in economic, ecologic and social terms…Today’s energy decisions will shape Europe’s supply system for at least the next 50 years…In view
of the fundamental transformation needed to ensure a sustainable Europe by the middle of the 21st century, a fundamental structural change is needed. As investments in the energy sector are of a long-term nature, the decisions we take today will have an impact on the energy system of tomorrow…[I]t is not a matter of technology, but rather a matter of making the right choices today to shape tomorrow. The challenge ahead of us is huge, but we have no choice if we want to act responsibly towards future generations.”

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- From RE-thinking 2050: “…Determining a long-term vision over 40 years is, by nature, a difficult task and the resulting outlook should by no means be seen as an exact prediction of what the future has in store for us. Projections of economic growth rates, fossil fuel prices and of the overall energy demand are of course assumptions and do by no means represent concrete prognoses. Long-term scenarios are to be considered as analytical tools for reflection, highlighting choices and opportunities, rather than predicting the future. However, looking at the energy system of tomorrow can provide valuable insight into what has to be done today to achieve the desired situation in the EU in 2050.”