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Impact of fossil-free decentralized heating on northern European renewable energy deployment and the power system

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  • Chen, Yi-kuang
  • Jensen, Ida Græsted
  • Kirkerud, Jon Gustav
  • Bolkesjø, Torjus Folsland

Abstract

Complying with ambitious EU climate targets, decarbonization pathways for space heat and hot water, in addition to the centralized energy generation sector, are analyzed using the open energy modeling framework, Balmorel. Hybrid systems and simplified consumer preferences are incorporated in the investment choices for decentralized heat. Five scenarios are analyzed: three with varying heat demand developments by 2050, one acknowledging the presence of carbon-neutral gas, and one covering only power and centralized heat sectors for comparison. All scenarios must comply with the EU emission targets in both the Emission Trading System (ETS) and non-ETS sectors by 2030, followed by a linear reduction towards zero fossil CO2 emissions by 2050. The optimization model reveals that the most cost-effective solution is electrification, which requires substantial investment in wind energy infrastructure. In the case of constant decentralized heat demand, the electricity demand will increase by one-third from the current level, consequently quintupling the installed wind capacity. Heat demand seasonality causes challenges leading to extreme high and low seasonal prices, and substantial curtailment in summer. Impacts on the power system have been underestimated because decarbonizing decentralized heat has not been considered. The results also imply a more important role for system integration.

Suggested Citation

  • Chen, Yi-kuang & Jensen, Ida Græsted & Kirkerud, Jon Gustav & Bolkesjø, Torjus Folsland, 2021. "Impact of fossil-free decentralized heating on northern European renewable energy deployment and the power system," Energy, Elsevier, vol. 219(C).
    • Handle: RePEc:eee:energy:v:219:y:2021:i:c:s0360544220326839
    DOI: 10.1016/j.energy.2020.119576
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    1. Christoph Böhringer & Carsten Helm, 2023. "The Reverse Waterbed Effect of Sector Coupling — Unilateral Climate Policies and Multilateral Emissions Trading," CESifo Working Paper Series 10362, CESifo.
    2. Wang, Mingtao & Zhang, Juan & Liu, Huanwei, 2022. "Thermodynamic analysis and optimization of two low-grade energy driven transcritical CO2 combined cooling, heating and power systems," Energy, Elsevier, vol. 249(C).
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    4. Bruck, Axel & Díaz Ruano, Santiago & Auer, Hans, 2022. "One piece of the puzzle towards 100 Positive Energy Districts (PEDs) across Europe by 2025: An open-source approach to unveil favourable locations of PV-based PEDs from a techno-economic perspective," Energy, Elsevier, vol. 254(PA).
    5. Madurai Elavarasan, Rajvikram & Nadarajah, Mithulananthan & Pugazhendhi, Rishi & Sinha, Avik & Gangatharan, Sivasankar & Chiaramonti, David & Abou Houran, Mohamad, 2023. "The untold subtlety of energy consumption and its influence on policy drive towards Sustainable Development Goal 7," Applied Energy, Elsevier, vol. 334(C).
    6. Ian M. Trotter & Torjus F. Bolkesj{o} & Eirik O. J{aa}stad & Jon Gustav Kirkerud, 2021. "Increased Electrification of Heating and Weather Risk in the Nordic Power System," Papers 2112.02893, arXiv.org.
    7. Zeyen, Elisabeth & Hagenmeyer, Veit & Brown, Tom, 2021. "Mitigating heat demand peaks in buildings in a highly renewable European energy system," Energy, Elsevier, vol. 231(C).
    8. Chen, Yi-kuang & Kirkerud, Jon Gustav & Bolkesjø, Torjus Folsland, 2022. "Balancing GHG mitigation and land-use conflicts: Alternative Northern European energy system scenarios," Applied Energy, Elsevier, vol. 310(C).
    9. Sifnaios, Ioannis & Sneum, Daniel Møller & Jensen, Adam R. & Fan, Jianhua & Bramstoft, Rasmus, 2023. "The impact of large-scale thermal energy storage in the energy system," Applied Energy, Elsevier, vol. 349(C).
    10. Jåstad, Eirik Ogner & Trotter, Ian M. & Bolkesjø, Torjus Folsland, 2022. "Long term power prices and renewable energy market values in Norway – A probabilistic approach," Energy Economics, Elsevier, vol. 112(C).
    11. Xiaoyang Hou & Shuai Zhong & Jian’an Zhao, 2022. "A Critical Review on Decarbonizing Heating in China: Pathway Exploration for Technology with Multi-Sector Applications," Energies, MDPI, vol. 15(3), pages 1-23, February.
    12. Backe, Stian & Zwickl-Bernhard, Sebastian & Schwabeneder, Daniel & Auer, Hans & Korpås, Magnus & Tomasgard, Asgeir, 2022. "Impact of energy communities on the European electricity and heating system decarbonization pathway: Comparing local and global flexibility responses," Applied Energy, Elsevier, vol. 323(C).
    13. Alexander Roth & Dana Kirchem & Carlos Gaete-Morales & Wolf-Peter Schill, 2023. "Flexible heat pumps: must-have or nice to have in a power sector with renewables?," Papers 2307.12918, arXiv.org.
    14. Nagel, Niels Oliver & Böhringer, Christoph & Rosendahl, Knut Einar & Bolkesjø, Torjus Folsland, 2023. "Impacts of green deal policies on the Nordic power market," Utilities Policy, Elsevier, vol. 80(C).

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