Consequences of the Renewable Energy Directive on the Norwegian energy system

Project work from NorRen Summer School

The EU Renewable Energy Directive is now implemented in the EU Member States and also adopted by Norway. The Directive has defined an overall goal for the renewable energy share for Norway to 67.5 % by 2020, which gives implications both on the energy production and the energy use. As a part of a PhD summer school project in renewable energy we have played with different scenarios for the development of new energy production and changes in consumption patterns in order to estimate how and to what extent these scenarios would lead to the fulfillment of the EU targets or not. We stress the fact that this work should be seen as an educational and intellectual exercise rather than our scientific based guesses for the development towards the 2020 goals.

Introduction to the RES Directive

The Renewable Energy Directive, as part of the EU Climate and Energy Package, promotes the expansion and intensification of the use of energy from renewable sources. In order to do so, the Directive sets an overall target of 20% for the EU and individual targets for Member States in terms of gross final consumption of energy to be met by 2020. Within the overall energy target there is a specific obligation to meet 10% of energy used in transport from renewable sources.
In order to achieve a fair and adequate allocation of the “burden”, the calculation of the national contributions has taken into account Member States’ different starting points and potentials, including the existing level of energy from renewable sources and the energy mix, as well as their level of economic development. Some of the individual targets are shown in the below figure. By contrast, it has been considered appropriate to set the 10 % target for energy from renewable sources in transport at the same level for each Member State (MS) in order to ensure consistency in transport fuel specifications and availability.



Under the directive, MS have adopted National Renewable Energy Action Plans (NREAPs) where the targets for each sector are set up. According to the NREAPs, more than one third of our electricity consumption will come from renewable energy sources in 2020 (up to 34.3%) with wind energy (14.1%) followed by hydropower (10.5%), biomass (6.5%), photovoltaic (2.35%) and other sources.

The Norwegian ambition

Norway has an ambitious target of increasing its share of renewable energy to 67.5% by 2020. This represents an increase of 7.4% from 2005 (60.1%). Because of the already large renewable share in the country, the management and extension of the renewable sector requires a strategy that touches upon both the production and consumption side.
The renewable energy share is calculated as shown in the below figure. In the following we will explain the various boxes and discuss how they will change in the years towards 2020 in order to reach the target.

Renewable electricity production

Hydropower stands for by far most of the electricity production in Norway, and will be the main source of electricity in 2020; despite that the volume of wind power production is expected to increase substantially. In 2006 the hydropower production was 121 478 GWh. New hydropower production can come into the energy system from small-scale hydropower (defined as < 10 MW), large hydropower and from refurbishment of existing plants, and it is expected that large hydropower will contribute more to the new production in the coming years than in the preceding 10 years.

It should be noted that the annual hydropower production varies from year to year depending on climatic conditions (precipitation and temperature), and when assessing the trends a normalization of the data is needed. The estimates for 2020 (if a normal year) is about 135 TWh.



Onshore wind is an important contributor in the green electricity certificate market of Norway and Sweden. Electricity production from wind is estimated to amount to half of the goal of 26.4 TWh new renewable electricity production in the two countries by 2020. This sector is counting for just above 1 percent of Norway´s energy production with about 580MW installed (around 1.6 TWh). The projection of the wind energy production in Norway by 2020 is expected to be 7-8 TWh. The other potential wind energy is offshore wind. Norway has large offshore areas with very good wind conditions. However, some challenges such as depth of water could be reducing the chance of development of any offshore wind energy in near term. The timing for actual exploitation will depend on technology development, cost and demand. No commercial offshore wind power projects have been initiated in Norway due to the lack of sufficient subsidies/support schemes for offshore wind. As a result of lack of financial support mechanisms, it is not expected any project development or installations before 2020. Therefore, this power alternative couldn’t be an option to meet the Norwegian renewable energy goal.

The below figure shows the 2006 numbers for electricity production from wind and hydro, as well as various scenarios for the production in 2020.

Renewable heat production

Renewable energy heating and cooling (REHC) has been described as the “sleeping giant” of renewable energy potentials from the global perspective. Mature REHC technologies using solar, biomass and geothermal resources are currently available as cost-effective means of reducing both carbon dioxide emissions and fossil fuel dependency under many circumstances.
In Norway, Enova designed in 2001 a program specifically for renewable heating in order to achieve its specified targets by supporting new heating plants, distribution systems for heating, and sustainable supplies of biomass. A target for renewable heat was set at 14.4 PJ annually, being equivalent to the heat requirements of over 100 000 Norwegian households. After more than ten years of heating efforts, district heating has been established in 60 of Norway’s 100 cities, and Enova has supported about 1 200 small and large projects with a total annual renewable heating delivery of more than 5TWh for heating in buildings.
According to the “Energy account and energy balance, 2011-2012, preliminary figures”, the Renewable energy for heating and cooling have already exceed the target value from 2004, as Table1 shows. In addition, it is predicted that the total capacity of REHC will be 22 308 GWh in 2020[4], which is increased by 27% compared with the value of 2004. 

In order to increase the solar thermal energy contribution to the winter heating and take full advantage of solar energy in Norway, we suggest a possible proposal about combining the seasonal solar storage, ground source heat pump and distributing heating technology together to reduce the electricity demand in the heating system.

Energy end use

Energy end use consists of various losses, stationary energy use and transport.

Energy Losses

Network losses consist of transmission system losses, distribution system, and the losses by the harmonic power because of power quality issues. In transmission system, the losses in transmission lines, transformers, in both primary and secondary side, and HVDC system. In the HVDC, which is the most probable option for future offshore wind, the loss in high power electronics switches is significant particularly in case of line-commutated converters (LCCs). Besides, the resistive configuration of dc grid causes more copper loss in the system. In distribution level the significant losses are copper loss and also magnetizing of distribution transformers. Some methods are suggested to reduce the power system losses in both transmission and distribution level. The solutions include the high efficiency transformers and the reactive power compensators in order to reduce the reactive power losses from the generation to the demand.

Stationary Energy Consumption

In general, energy end use can be divided to industrial applications and other sectors including residential, commercial and public services, etc. The second category may be considered as lighting, heating/cooling and appliances. In order to reduce electricity demand in industries the new governmental policies can be established to encourage industries for reducing electricity usage by using more efficient electrical devices and/or processes. As another option, defining energy efficiency standards to be used by industry is also a useful alternative. In terms of home/public application, however, there are several solutions should be generally considered in Norway such as smart houses with intelligent control systems, new technologies for both lighting and heating, obligations for electricity consumption limits, and isolation. At the same time, all of the above-mentioned approaches require a precise cost-benefit analysis to ensure the effectiveness of the solutions from economical point of view.

Transport

In 2006 the energy consumption in the transport sector was 52 TWh. The largest portion of this energy consumption is from diesel oil and gasoline.



Today the renewable share of the transport sector (electricity + sustainable biofuel) is about 1 % and needs to increase to minimum 10 % according to the Renewable Energy Directive.

Cars are the mostly used device used for person transport. The below figure shows the percentage of passenger kilometers for each transport device.



As the electricity produced in Norway is mainly renewable, increasing the number of battery electric vehicles (BEV) will directly increase the amount of renewable energy in the transport sector. The measures to increase the number of BEVs are

• paying less taxes when buying the car (taxes on new Norwegian cars are based on CO2 emissions);
• not paying road tolls;
• free parking in public parking areas;
• allowed to drive in the bus lane.

The number of electric cars in Norway was about 7000 in 2012.
Electrical charging stations are widely built around Norway.

The government has taken action to reduce the use of cars. In cities the public transport systems are highly accessible and subsidized. Most buses run on diesel, but it has been suggested to replace them with electricity or bio fuel driven buses.
Rush time hour road tolls are not currently being used, but have been suggested to reduce the personal transport by car. If the public in stead use a electricity / bio fuel driven bus, this will also increase the share of renewable energy in the transport sector.

The Ministry of Transport and Communications established in 2009 Transnova, whose objective is to reduce the CO2-emissions from the transport sector by substituting fossil fuels with low or non-emission fuels. Secondary goals are to encourage more environmental friendly transportation or to reduce transportation. Other measures are promotion of biofuels or other renewables for cars, decreasing the speed limit to avoid local pollutions, and extra taxes on gasoline and diesel oil.
The Ministry of Petroleum and Energy concludes with the following estimates for renewable energy transport; the left figure is the present situation in 2006, while the right figure is the most likely scenario for 2020.



In addition to increasing the amount of electricity for personal cars, there is a potential for the trains as only 80 % of the public train traffic is run on electricity today. The remaining 20 % is mostly run on diesel. There are no immediate plans to increase the amount of electricity in the train sector, but the technology is available.

Technologies for BEVs are today present, but not widely used by the general public despite the benefits given by the government. A reason for this is the concern about battery capacity and lifetime. To meet this concern, more research in better batteries is necessary. It is also possible for the state to subsidize new batteries for existing BEVs.

Conclusions

Summing up the (expected) contributions from the various sectors, gives the following picture for the energy end use:



The expected increase in used energy is approximately 10 % in each sector. The pessimistic and optimistic scenarios are guesses for how bad or good the development could potentially be.
Similarly we can create prognosis for the renewable energy share in 2020, where the most likely scenario is based on reports from IFE and the Ministry of Petroleum and Energy in Norway. As we see the most likely scenario reaches the target of 67,5 %, while the optimistic and pessimistic scenarios reach shares of renewable energy of 82 % and 61 % respectively.



Today approximately 98 % of the electricity production comes from renewable. However, increasing the renewable electricity production is reasonable if all trains and a larger amount of cars run on electricity. The Norwegian government has suggested to electrify the offshore sector, which would also require to increase the (renewable) electricity production. However, no action regarding this manner has been taken, and is most likely not accomplishable by 2020.

References

• Renewables for Heating and Cooling, 2007, INTERNATIONAL ENERGY AGENCY
• Enova Annual Report, 2012, ENOVA SF
• Energy account and energy balance, 2011-2012, preliminary figures, Statistics Norway
• National Renewable Energy Action Plan under Directive 2009/28/EC, 2012, NRAP
• Energy in Norway, Norwegian Water Resources and Energy Directorate (NVE)
• National Renewable Energy Action Plan under Directive 2009/28/EC, Ministry of Petroleum and Energy, Norway, 2012
• Sustainable Energy and Research Strengths in Rogaland Region- current status report, the European North Sea Energy Alliance (ENSEA) project, 2013
• Energy Efficiency Policies and Measures in Norway, Institute for Energy Technology, Norway, 2012