There is much to encourage Europe’s cogeneration and district energy industries in the European Commission’s launch of a strategy to achieve what it calls a ‘resilient Energy Union alongside a forward-looking climate change policy.’
The EC’s vision of an Energy Union is all about maximising flexibility of energy systems across the continent in order to cut primary energy use and thus reduce imports. This is to be achieved by new rules that ensure energy users having more choice of suppliers; the phasing out of poorly designed subsidies; and energy flowing freely across national borders. But the EC also points to a fundamental rethink of energy efficiency – seeing it as a resource in its own right; and ensuring that locally-produced energy – including renewables – can be absorbed into energy grids.
Europe is the largest energy importer in the world, importing around 53% of its energy at an annual cost of €400 billion ($443 billion), so any way to reduce these imports is to be welcomed.
Trade association COGEN Europe has emphasised the obvious connection between high-efficiency cogeneration technology, heat, and the need to cut energy imports. Just a day after the EC announcement, the association issued its own manifesto calling for heat to be taken into account thoroughly in the EC’s work towards the union. Fundamentally, cogeneration works by recovering and putting to use what would otherwise be enormous quantities of ‘waste’ heat discarded at thermal power plants.
COGEN Europe also refers the EC back to the results of the recently-completed CODE 2 project, which estimated that cogeneration could double in size to generate one-fifth of the EU’s electricity by 2030, employing a growing proportion of renewable fuels and delivering substantial primary energy savings. The amount of Europe’s heat supplied by cogeneration would grow by half, and CO2 emissions would be cut substantially.
But market barriers to the wider uptake of cogeneration and district energy remain. Apart from recent poor spark spreads, the main challenge for cogeneration remains overcoming energy market failures which expose CHP operators to variability of both electricity and fuel markets. Achieving a reasonable business proposition for CHP developers and operators straddling these two energy markets is still the single biggest challenge for the sector, concludes the CODE 2 report.
COGEN Europe’s new heat manifesto calls for the EC to use an integrated approach to the energy system, where heating and cooling are taken into account at the start of any process towards new legislation. Any new European heating and cooling strategy must interact genuinely with the power and fuel supply sectors in order to overcome the main barriers to cogeneration.
The manifesto also calls for the tracking of primary, not just final, energy consumption, and in particular the massive losses occurring in power systems, by EU member states. As COSPP readers will already know, something approaching two-thirds of the primary energy supplied as fuel to coal-fired power plants is lost as waste heat or, put another way, more heat is discarded at power stations than is used to heat buildings in many countries.
Integrate heat with power policies, and take proper note of energy system wastage – if the EU takes note of this advice from the industry, its move towards a new Energy Union will also benefit the decentralised energy industry.