How to measure the overall energy savings linked to policies and energy services at the national level?

The Energy End-use Efficiency and Energy Services Directive (ESD) of the European Union requires the member states to define and attain an overall target of at least 9% annual energy savings between 2008 and 2016. Even if this target is indicative, this is the first international framework mandating countries to report on their energy savings results and prove achievement of their targets. The directive thus also required the development of harmonised calculation methods that can be used by member states for this proof and reporting. Existing literature covers most of the usual issues related to energy savings evaluation, but mostly looking at single, given energy efficiency programmes or policies. The evaluation objective for the ESD implementation is different, as it aims at accounting for the whole energy savings achieved in a country. Moreover, one of the main difficulties is the diversity in history and experience on this topic among the member states. In this context, the European project EMEEES has worked out an integrated system of bottom-up and top-down methods for the measurement of energy savings. The paper presents the overview of its final results. The proposals, inter alia, include 20 bottom-up and 14 top-down case applications of general evaluation methods. They enable more than 90% of the potential energy savings to be measured and reported. They were used as a starting point by the European Commission to develop the methods recently recommended to the member states. Furthermore, the paper briefly discusses the importance of the quantity to be measured—all or additional energy savings—and the effect of measures implemented before the entering into force of the ESD (‘early action’), and what this meant for the methods to be developed. It compares the main elements of calculation needed to ensure consistent results between bottom-up and top-down methods at the overall national level. Finally, general conclusions are drawn about what could be the next steps in developing an evaluation system that enables a high degree of comparability of results between different countries.     

Renewable energy strategies for rural Africa: is a PV-led renewable energy strategy the right approach for providing modern energy to the rural poor of sub-Saharan Africa?

Rural areas continue to be home to majority of the population in Africa. The importance of providing modern energy to rural areas cannot, therefore, be overemphasised. Despite numerous efforts by Governments and donors in the region to promote solar photovoltaics (PVs) for rural electrification (almost every country in the region has had a rural electrification PV project), access to modern energy in rural Africa continues to be woefully low. In addition to being unaffordable to the rural masses, solar PV has the limitation that it can only be used for lighting and powering low-voltage appliances. This article reviews emerging trends in the rural energy sector of sub-Saharan Africa, and discusses the limitations of over-reliance on solar PV. It suggests possible options that could have greater impact on rural clean energy development. For the majority of rural households in the region, biomass fuels will continue to be the dominant fuel of choice. Efficient technologies for the use of biomass would, therefore, ensure that scarce biomass resources are effectively utilised, and reduce the negative impacts of biomass use on women and children's health. Solar thermal, windpumps, micro-/pico-hydropower and cleaner fuels such as kerosene and LPG, have not received adequate attention from policy makers. These energy options could significantly improve the performance of rural small- and micro-enterprises. This article argues that rural energy policies that emphasise a broader range of renewables and target income-generating activities are likely to yield greater benefits to the rural poor than the current policies that rely on the solar PV option.     

EU–MENA energy technology transfer under the CDM: Israel as a frontrunner?

The majority of the Middle East and North Africa (MENA) countries possess substantial potential for the implementation of CDM projects. Abatement of Greenhouse Gas (GHG) emissions can mainly be achieved through utilizing the abundant Renewable Energy Sources (RES) in the region and the implementation of Energy Efficiency (ENEF) measures. However, most of the MENA countries have a limited track record as regards CDM projects in the pipeline comparing to the major CDM-players, like Asia-Pacific regions and Latin America. In the above framework, this paper investigates the current status of CDM in the MENA region and the related perspectives for further diffusion of the CDM though the elaboration of a Strengths–Weaknesses–Opportunities and Threats (SWOT) Analysis. Particular emphasis is laid on the case of Israel, which seems to make an exception to the rule, since it hosts most projects in the region and dominates among the MENA countries.     

Fusion energy : An energy source of the future?

With an increasing world population and a growing economy, the demand for energy is sure to grow. The latest predictions for world energy demand all show an upward trend and even with increased energy efficiency we will still need substantially more energy by 2050 than we use today. Where's it to come from? Dr Federico Casci of the European Fusion Development Agreement (EFDA) organisation believes part of the answer is fusion…     

Does renewable energy substitute LNG international trade in the energy transition?

Renewable energy is a vital tool for the energy transition and sustainable development goals. The global economy, however, remains heavily reliant on fossil fuels despite efforts to reduce global greenhouse gas emissions. Demand for natural gas is rising as a bridge for moving towards a low-carbon economy, but whether natural gas and renewable energy represent substitutes in the global energy mix remains underexplored. We tackle this concern by examining the impact of renewable policies on international trade in liquified natural gas (LNG) among 1359 trading partners during the period 1988–2017. We measure renewable energy policies based on the ratio of renewable energy to total energy usage in importing trading partners, which also corresponds to a proxy for energy transition policies. The analysis is conducted using a global panel dataset in a trade gravity framework by applying various econometric methods and model specifications to measure LNG trade as a dependent variable. The results show that the energy transition, measured by the share of renewable energy, has a negative impact on LNG trade. This suggests that investing in cleaner energy technologies can reduce LNG trade globally, as a channel towards reducing natural gas demand. The results are consistent with the narrative where natural gas and renewable energy represent partial substitutes at the global level. However, subgroup analysis suggests that less-developed economies and the shale revolution period seem to impede progress towards the energy transition.     

How much will the energy service directive contribute to the 20% EU energy savings goal?

The Energy Service Directive (ESD) of the European Union (EU) stipulates that member states realize 9% energy savings for the period 2008–2016. A harmonized calculation approach, consisting of a combination of top-down and bottom-up methods, will be developed to determine the savings of energy efficiency improvement measures. However, it is unclear which part of all realized energy savings is eligible in meeting the ESD target. One can argue that not all savings, especially the autonomous efficiency gains, should be accounted for, but only savings due to (new) policy. An analysis is made of the way the methods can be applied, how baseline choices define the savings and whether these represent policy-induced savings. It is shown that the given target could be met with total energy savings that equal 1.0% of ESD energy use per year, hardly more than realized at present. With other choices, the target is met with total savings of 1.6% per year. The savings found are made comparable with the 2.4% yearly savings derived from the 20% savings target for 2020 formulated by the EU. Given the large gap between ESD savings and the savings target, it is concluded that the methods and baselines used should be chosen such that the ESD target leads to realized savings after 2008 at the upper side of the margin.     

What is the global potential for renewable energy?

World energy demand is projected to rise to 1000 EJ (EJ = 10¹⁸ J) or more by 2050 if economic growth continues its course of recent decades. Both reserve depletion and greenhouse gas emissions will necessitate a major shift from fossil fuels as the dominant energy source. Since nuclear power is now unlikely to increase its present modest share, renewable energy (RE) will have to provide for most energy in the future. This paper addresses the questions of what energy levels RE can eventually provide, and in what time frame. We find that when the energy costs of energy are considered, it is unlikely that RE can provide anywhere near a 1000 EJ by 2050. We further show that the overall technical potential for RE will fall if climate change continues. We conclude that the global shift to RE will have to be accompanied by large reductions in overall energy use for environmental sustainability.     

Sure,but who has the energy? The importance of location for knowledge transfer in the energy sector

Using over 350,000 U.S. patent citations, we test whether knowledge transfers in the energy sector are sensitive to distance, and whether that sensitivity has changed over time. Controlling for self-citation by inventor, assignee and examiner, multivariate regression analysis shows that physical distance is becoming less important for spillovers with time, but differs by energy subsector.     

Can the future EU ETS support wind energy investments?

This article discusses how the future Emissions Trading Scheme legislation should be designed to allow the European Union to comply with the 20% CO₂ emissions reduction target, while at the same time promoting wind energy investments. We examine whether CO₂ prices could eventually replace the existing support schemes for wind and if they adequately capture its benefits. The analysis also looks at the effectiveness of the clean development and joint implementation mechanisms to trigger wind projects and technology transfer in developing countries. We find out that climate policy is unlikely to provide sufficient incentives to promote wind power, and that other policies should be used to internalise the societal benefits that accrue from deploying this technology: CO₂ prices can only reflect the beneficial impact of wind on climate change but not its contribution to the security of supply or employment creation. A minimum price of around €40/tCO₂ should be attained to maintain present support levels for wind and this excludes income risks and intermediation costs. Finally, CDM improves the return rate of wind energy projects in third countries, but it is the local institutional framework and the long-term stability of the CO₂ markets that matters the most.     

Will the aggregation approach affect energy efficiency performance assessment?

Aggregate energy is usually measured in the linear weighted summation of various energy types based on thermal dynamics laws. This measurement is scientific and acceptable in the physics or energy engineering world. However, it implicitly assumes that all energy types are perfectly substitutable and thus may result in distorted conclusions in energy-economy research. In economics world, production factors are usually non-linearly aggregated using Divisia approach, which is derived from microeconomic theory and considers the heterogeneity and imperfect substitutability among various energies. Using which “ruler” to measure the aggregate energy, the linear one or the others, will certainly affect the conclusions and energy saving incentives of the economic agents. Inequitable energy aggregations may bring out speculations or discouraged behaviors. According to China's current provincial energy efficiency performance assessment policy, the central government assigned the target of reducing the national aggregate energy intensity by 20% in 2006–2010 to provincial authorities in 2006. And in July 2011, the central government formally released the provincial assessment results based on conventional linear aggregation approach (coal equivalent). Our re-examination review this policy and show that the official results are quite different to that based on Divisia approach. From the perspective of economics, some local performances are overestimated and others are underestimated. To raise the equity and incentive compatibility of the assessment, we suggest the central take the imperfect substitutability or energy structure changes into consideration. We also discuss the difficulties and deficiencies when using Divisia aggregate approach.     

What is the fuel of the future? Prospects under the Clean Power Plan

EPA proposed the Clean Power Plan (CPP) to regulate CO₂ emissions from existing power plants. The CPP establishes state-by-state emission rate goals for affected fossil units, largely existing coal and natural gas combined cycle generators. A key element of the proposal is its flexibility mechanisms, including the ability of states to trade obligations with other states and to convert to mass-based targets. How states decide to take advantage of this flexibility may have significant impacts on fuel markets of the future. This analysis uses the DIEM economy/electricity model to examine the consequences of a range of these alternative choices for fuel demands across the United States. Key findings for the June 2014 proposal include: the CPP tends to continue an ongoing shift in fuel consumption by electricity generators from coal to natural gas, a rate-based approach to CPP leads to more gas use in the early years than a mass-based approach but the effect disappears over time as new more-efficient gas units are constructed, and there may be substantial regional variation and stresses in fuel markets, especially over the next five years.     

Diversification of oil import sources and energy security: A key strategy or an elusive objective?

This paper explores the relationship between the diversification of sources of imported oil and energy security of oil-importing countries. It examines the importance of diversification policy for oil importers, explains why oil importers implement oil diversification policy, and contextualizes the oil import diversification strategy in the overall energy security policy of oil importers. The paper analyzes the factors and the contexts that affect the level of importance assigned to oil import diversification policy in oil-importing countries, and the limitations that may affect the successful implication of oil import diversification policy. The examples are drawn from the world's top three oil importers, the United States, Japan, and China. The policymakers in these and other oil-importing countries place much importance on energy security. The diversification of oil import sources is used as one of the strategies to enhance energy security in oil-importing countries. This paper is important for policymakers in oil-importing countries as it provides them with a qualitative conceptual framework with which to evaluate the need to diversify their countries’ sources of imported oil, and with which to identify the likely limitations to the successful implementation of oil import diversification policy.     

Is inexpensive natural gas hindering the grid energy storage industry?

Grid energy storage is a maturing technology and forecasts of the industry's growth have been promising. However, recent years have realized little growth in actual deployments of grid-level storage and several high-profile storage companies and projects have failed. We hypothesize that falling natural gas prices have significantly reduced the potential profit from many U.S. energy storage projects since 2009 and quantify that effect. We use engineering–economic models to calculate the monthly revenue to energy storage devices providing frequency regulation and energy arbitrage in several electricity markets and compare that revenue to prevailing natural gas prices. We find that flywheel devices providing frequency regulation were profitable in months when natural gas prices were above $7/mcf, but face difficulties at current prices (around $4/mcf). For energy arbitrage alone, we find that the breakeven capital cost for large-scale storage was around $300/kWh in several key locations in 2004–2008, but is around $100/kWh in the same locations today. Though cost and performance improvements have been continually decreasing the effective cost of energy services from storage, fundamental market signals indicating the need for energy storage are at or near 10-year lows for both energy arbitrage and frequency regulation.     

Putting renewables and energy efficiency to work: How many jobs can the clean energy industry generate in the US?

An analytical job creation model for the US power sector from 2009 to 2030 is presented. The model synthesizes data from 15 job studies covering renewable energy (RE), energy efficiency (EE), carbon capture and storage (CCS) and nuclear power. The paper employs a consistent methodology of normalizing job data to average employment per unit energy produced over plant lifetime. Job losses in the coal and natural gas industry are modeled to project net employment impacts. Benefits and drawbacks of the methodology are assessed and the resulting model is used for job projections under various renewable portfolio standards (RPS), EE, and low carbon energy scenarios We find that all non-fossil fuel technologies (renewable energy, EE, low carbon) create more jobs per unit energy than coal and natural gas. Aggressive EE measures combined with a 30% RPS target in 2030 can generate over 4 million full-time-equivalent job-years by 2030 while increasing nuclear power to 25% and CCS to 10% of overall generation in 2030 can yield an additional 500,000 job-years.     

Setting the standard? A framework for evaluating the cost-effectiveness of building energy standards

The adoption rate and stringency of building energy standards in the U.S. have been increasing since the mid-1990s as a result of the Energy Policy Act mandate of 1992 (EPAct). Current evidence on the energy savings that accrue from commercial building energy standards is based on engineering simulations, which do not account for realized behaviour once a standard is actually adopted. This paper uses quasi-experimental variation in commercial building energy standard adoptions to estimate their effect on realized electricity consumption and cost-effectiveness. In states induced by EPAct to adopt an energy standard where all new nonresidential construction was erected under a commercial standard, electricity consumption per service worker is lower by about 12%, and total commercial electricity consumption is lower by 10%. Including early adopters and never-adopters to the analysis leads to a downward bias in the treatment effect. The realized electricity savings in the EPAct states represent three quarters of predicted simulated savings, and electricity saved in 2010 came at a cost of approximately 7.7 cents per kWh.     

Gone with the wind? — Electricity market prices and incentives to invest in thermal power plants under increasing wind energy supply

The increased wind energy supplied to many electricity markets around the world has to be balanced by reliably ramping units or other complementary measures when wind conditions are low. At the same time wind energy impacts both, the utilization of thermal power plants and the market prices. While the market prices tend to decrease, the impact on the utilization of different plant types is at the outset unclear. To analyze the incentives to invest in thermal power plants under increased wind energy supply, we develop a computational model which includes ramping restrictions and costs and apply it to the German case. We find that due to current wind supply the market prices are reduced by more than five percent, and the incentives to invest in natural gas fired units are largely reduced. An increased wind supply erodes their attractiveness further. Consequently, a gap between the need for and the incentive to provide flexibility can be expected.     

Keeping energy visible? Exploring how householders interact with feedback from smart energy monitors in the longer term

This paper reports on how, over a 12-month period, UK householders interacted with feedback on their domestic electricity consumption in a field trial of real time displays or smart energy monitors. Drawing on the findings of 11 follow-up qualitative interviews with householders involved in a ‘Visible Energy Trial’, the paper suggests that: (i) over time, smart energy monitors gradually become ‘backgrounded’ within normal household routines and practices; (ii) the monitors do increase householders’ knowledge of and confidence about the amount of electricity they consume; (iii) but, beyond a certain level and for a wide variety of reasons, the monitors do not necessarily encourage or motivate householders to reduce their levels of consumption; and (iv) once equipped with new knowledge and expertise about their levels of electricity consumption, household practices may become harder to change as householders realise the limits to their energy saving potential and become frustrated by the absence of wider policy and market support. The paper concludes by reflecting on the policy and research implications of these findings in relation to future transition pathways to a low-carbon economy.     

Renewable energy applications in Greece—What is the public attitude?

Large-scale integration of Renewable Energy Sources (RES) applications is thought to be imperative for Greece in view of meeting the targets of 2020, which dictate that 20% of the national gross energy consumption and 40% of the national gross electricity consumption should be covered by RES. However, availability of suitable sites for the installation of such applications is questioned, since apart from the fact that many locations of high RES potential and adequate infrastructure have already been allocated, the society opposition often sets additional barriers. The present study focuses on the assessment of the levels of social acceptability for selected RES technologies (wind, small hydro and photovoltaics) in a representative region of Southern Greece. The specific area is of major interest since, apart from the operating and scheduled installations of RES applications in the next years, the local population is also familiar with the long-term operation of a lignite-based power station (850 MW). One three-part questionnaire has been deployed for conducting the survey based on a representative sample of local inhabitants. According to the results obtained, high levels of acceptability of renewable energy applications have been encountered although the need for additional public information regarding RES exploitation has also been designated.