An article by Danish Energy – Energy system integration will lead the way towards climate neutrality

The European Commission has adopted a new strategy that will transform our energy system and contribute to the target of climate neutrality in a cost-effective way. According to Commissioner Simson, the EU is in need for a “paradigm shift to reach our 2030 and 2050 targets”. This includes better integration of different energy systems, increasing flexibility and deploying more clean energy sources, e.g. renewable hydrogen.

Anders Stouge, deputy director general in Danish Energy, believes energy system integration is one of the main pillars of the green transition and welcomes the new strategy:

  • With this strategy, the European Commission wishes to reduce and reuse waste energy and connect different energy systems through sector integration. Electrification, being the most cost-effective solution, is at the centre of the strategy. Where direct electrification isn’t viable, power-to-x will be crucial for decarbonisation, Anders Stouge states and goes on:
  • There lies an enormous green potential in creating a more inter-connected energy system, where a holistic view on energy systems allows us to exploit synergies between them and reduce overall investment needs in the system, Anders Stouge says.
  • The strategy creates an investment agenda for clean technologies and will drive investments towards green, innovative solutions. The EU has the chance to become first-movers and create new value chains that will create jobs and growth.

Renewable hydrogen is one technology where the EU aims at becoming world leaders. Complementing the system integration strategy, the Commissions new EU hydrogen strategy outlines how this will become reality. Anders Stouge applauds the hydrogen strategy, stating that the EU won’t become world leaders if the technology isn’t brought to scale and prices substantially cut.

But hydrogen not only presents a new market opportunity, it is also essential for the green transition:

  • We must decarbonise all sectors, including heavy industries, aviation and shipping where direct electrification isn’t a viable solution. For that, we need renewable hydrogen and hydrogen-produced renewable e-fuels. The EU won’t reach climate neutrality without renewable hydrogen as an integral part of our energy systems, Anders Stouge says.

Energy efficiency as the guiding principle

Danish Energy applauds the Commissions emphasis on energy efficiency, making direct electrification the main priority being the most efficient and cost-effective solution.

  • Electrification is a main tool in the Commission’s endeavour to enhance energy efficiency and reduce waste energy. As stated in the strategy, electrification can decrease energy consumption by a third. That is significant! Therefore, we must power our cars, industries and buildings with green electricity as fast as possible, Anders Stouge states.

The renovation wave will address energy efficiency in buildings and at the same time promote electrification by installing heat pumps, solar cells and charging points for electric vehicles (EVs), contributing to the Commission’s aim of at least 1 million public charging points by 2025.

For industry, heat pumps are considered as a solution by the Commission:

  • The focus on heat pumps is positive, as they are an important part of the solution. Yet, a clear focus on high-temperature heat pumps that can decarbonise industrial processes demanding temperatures around 200 degrees or higher is lacking. The Commission needs to accelerate the development of this technology and make geographically wide-spread demonstration sites where industry easily can go and see high-temperature heat pumps at work. To seize this opportunity to become leaders in this field, the EU must act now, says Helle Juhler-Verdoner, Managing Director of Danish Intelligent Energy Alliance.

The strategy estimates that the share of electricity in final energy consumption will grow by 27 percentage points towards 2050 and that 84 percent of that electricity will be based on renewables.

  • In order to meet this large increase of electricity demand, we need a remarkable buildout of renewables, large infrastructure investments and a fundamental change in energy consumption, Anders Stouge says.

Flexibility and digitalisation as key elements

Use of flexibility and digitalisation in our energy systems is highlighted as essential tools for DSOs to integrate the large amounts of renewables intro the grid. Smart charging and Vehicle-to-Grid services are mentioned as essential solutions against grid congestion, coping with the millions of EVs connected to the grid.

  • To integrate the increased amounts of renewables into our grid and to reduce the increased grid investment needs, smart solutions and demand side flexibility is key, as it spreads out consumption and reduces peak consumption periods, Anders Stouge explains.

Digitalisation connects utilities to end-users which is fundamental to activate flexibility in energy consumption and thereby ensure cost-effective integration of energy systems and sector coupling.

  • Digitalisation is an important tool in making energy consumption flexible. We will see a wave of digitalisation in the coming time, and it will affect the way we interact with the energy system and the efficiency of the energy system, Anders Stouge concludes.