Until recently, the main point of discord in the climate debate surrounded the opposition of investing in fossil fuels as opposed to investing in renewable sources. Since the Fukushima accident in 2011, the discussion has shifted towards the merit of investing in nuclear against investing in renewables, with the potential side-effects of nuclear technologies overshadowing the potential externalities of carbon emissions in the public debate. However, given the present and projected future technology costs, is such a divide well-founded when considering long-term climate goals?

According to the European Commission’s latest policy, the European Union is aiming at reducing its greenhouse gas emissions by 80% compared to its 1990 levels by 2050. The goal of this policy is to limit the long-term increase in the average world temperatures to 2°C compared to pre-industrial levels. The power sector is perceived to be the easiest and least costly way to decarbonize as it offers several options: low-carbon power sources such as nuclear and renewables and technologies preventing emissions, i.e. carbon capture and storage (CCS).

Strong efforts are needed to reach the 2050 target

With more flexibility in its use, electricity is set to gain a greater share of the final energy demand mix. Additionally, the power sector has followed a trend of decreasing its carbon intensity per unit of GDP in the past, and it is expected this trend should continue in the future, as shown below by the baseline. However, in order to reach the 2050 target, an effort even more intense would be necessary, breaking new ground compared to the historical trend.

Carbon intensity of the power sector, EU-27, 1980-2050

Source: Enerdata, EnerFuture scenarios, POLES model

In the carbon-constrained scenario, an important part of the overall emissions reductions would occur in the power sector. Simultaneously, large efforts in energy conservation and energy efficiency in other sectors of the economy would also have to be undertaken. The resulting CO2 emissions from the power sector would wind up being slightly negative as a whole by 2050, due to the carbon uptake of biomass combustion technologies with CCS (i.e. adding CCS to biomass combustion, which is a process already considered as carbon-neutral).

Contributions in emissions reductions, EU-27, 2010-2050

Source: Enerdata, EnerFuture scenarios, POLES model

Reductions are mainly based on CCS technologies and renewables diffusion

Under a carbon constraint that becomes progressively more stringent in order to reach the 2050 target, the CCS technologies (57% of cumulative reductions) become the main contributors. They present the added benefit of being a technological “fix” that allows the power system to essentially operate as it does today, without any major changes in the way load management is conducted. However, despite this prominent role for the future energy landscape, CCS is a technology that is still unproven at an industrial scale. In addition, its deployment might suffer from intensive delays due to public opposition, as was the case in certain regions for nuclear or wind (e.g. rejection of the EU CCS Directive in Germany in 2011).

It follows then that the removal of CCS as an emissions reduction option results in Europe failing to meet its 2050 target. A much more intensive effort in carbon constraining measures has to be adopted to palliate the lack of CCS. The structural changes that this higher pricing of carbon brings to the economy are different: reductions in the power sector become more expensive, and more abatement potentials become accessible in other sectors (industry, buildings).

When CCS is removed, power prices are higher and demand is somewhat lower. CCS is replaced, by order of importance, by higher capacities of renewables, fossil fuels without CCS, and nuclear. Overall capacities remain roughly the same, due to the low load factor of renewables. With an increased presence of renewables (nearly 50% of power production for over 70% of total capacities installed, intermittent wind and solar power production 30%), the effects of intermittency weigh significantly on the power mix. Flexible power plants such as the fossil fuel thermal plants move from functioning in a base- and mid-load manner towards functioning as mid- and peak-load plants, in other terms as back-up capacities to intermittent renewables, necessary despite their carbon emissions.

Necessity to adapt the power system to allow the strong penetration of renewables

However, renewables reach their potential limits in Europe in order to reach the 2050 targets. Hydro presents few significant opportunities for expansion in Europe already. Biomass as an input to both power generation and direct final consumption and currently occupies all the surfaces that can realistically be attributed to it, and thus Europe has to rely heavily on biomass imports to feed its power system. Wind and solar are bottlenecked by the limited presence of flexible power plants as back-up capacity.

Structure of the European power system in 2050: Installed capacities and fossil fuel plants functioning hours

1. Carbon-constrained scenario to reach the 2050 target
2. Same carbon constraint, with no development of CCS (2050 targets not reached)
3. With no development of CCS and a heightened carbon constraint in order to reach the 2050 target

Source: Enerdata, EnerFuture scenarios, POLES model

These limits exist in a “traditional” power system, where some renewables technologies have to be complemented by standing back-up capacities. Both the development of renewables and the mitigation potential of the power sector are faced with these hard limits. In order to accommodate a higher renewables penetration, it is essential to redesign the power system to better take into account the intermittency of renewables and change the way electricity is produced and supplied: more dynamic interaction between demand and availability of supply (DSM, smart grids), geographically large-scale integration of different renewables solutions (super-grids), development of storage capacities (be it electric such as electric vehicles batteries, chemical or physical) are all solutions that could potentially allow for a much higher penetration of intermittent sources, but at the cost of significant investment in these new infrastructures.

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