Europe is phasing out Russian gas and replacing it with more renewables. That means there will be greater demand variability and a resulting impact on European spot gas prices. The problem is that long-term contracting, the traditional way for buyers to mitigate spot price risk, is incompatible with Europe’s climate objectives of reducing long term consumption of gas. Kong Chyong at the Center on Global Energy Policy proposes alternative policy … [Read more...]
Investing billions in new cross-border Electricity Transmission capacity can cover its costs within a few years
The huge divergence of electricity prices between nations after the energy crises of 2021 and 2022 exposed Europe’s pressing need to increase cross-border transmission capacity, explain George Dimopoulos, Conall Heussaff and Georg Zachmann at Bruegel. Without it, generation costs will be higher, emissions too, and new generation will continue to be badly congested. The author’s calculations reveal that one additional MW of cross-border capacity … [Read more...]
Why we need a European Central Carbon Bank within the EU ETS framework
The EU Emissions Trading System (EU ETS) is at a critical juncture as it navigates a path towards achieving a net-zero Europe by 2050. Amidst this transformation, the proposal to create the European Central Carbon Bank (ECCB) has sparked a range of criticisms. Some critics have raised valid concerns about the feasibility, necessity, governance, and potential drawbacks of such an institution. Robert Jeszke and Sebastian Lizak at the Centre for … [Read more...]
EU now has 9,000+ “energy communities”: smart, decentralised, flexible generation and consumption
The goal of the EU’s “Clean Energy for all Europeans package” (CEP), adopted in 2019, is to improve the functioning and design of Europe’s energy markets and systems. Luca Arfini, writing for ESCI, explains how, as part of the CEP, new market actors called “active customers/consumers and citizens” and “energy communities” are being established. As variable renewable generation grows, the whole system needs to be more decentralised, smarter and … [Read more...]
EU states agree deal on electricity market to protect consumers from price volatility, boost cheap renewable power
On Tuesday EU member states finally agreed on how to reform the bloc's electricity market after long months of difficult negotiations. The introduction of long-term contracts, particularly contracts for difference (CfDs), should stabilise prices for consumers and give certainty to investors in new generation. But the big concern had been how the state support implicit in CfDs might be used to bias the playing field in favour of nuclear and coal, … [Read more...]
Belgium: commercially viable Rooftop Solar for social housing. No installation subsidies, lower bills
Rooftop solar is becoming a key component of the roll-out of clean energy. But whereas the decision to install is straightforward for homeowners, how do tenants in social housing blocks take advantage of the subsidies and lower electricity prices? Sven Van Elst at ASTER and Maarten Michielssens at Energy Vision, writing for WEF, describe their project that is installing rooftop solar, free, for 52,500 social rental homes in Flanders, Belgium. No … [Read more...]
Oil & Gas business is fatally flawed: Russia-Ukraine only delayed the relentless decline in prices
The oil and gas producers have made windfalls off the back of Russia’s invasion of Ukraine and the consequent spikes in prices. But the return of prices to normal levels is re-emphasising the flaw in their business model, explains Clark Williams-Derry at IEEFA. The cost of producing the fossil fuels can only go up: the low hanging fruit was picked long ago, and finding and extracting new deposits gets more and more expensive. So do labour costs. … [Read more...]
Though the price shocks hurt, Renewables installed between 2021-23 saved Europe €100bn
According to the IEA, without the solar and wind capacity additions made in 2021-23 Europe’s energy costs would have been €100bn higher in those three years, as prices spiked due to Russia’s invasion of Ukraine and the unexpected drop in output from nuclear and hydro. That money saved is another reason why the ramp up of renewables is so important, explains Joe Myers writing for the World Economic Forum who summarises the IEA data. Natural gas … [Read more...]
Sodium-ion batteries ready for commercialisation: for grids, homes, even compact EVs
Sodium-ion (Na-ion) batteries, a much more abundant and cheaper alternative to the standard Lithium-ion, are on the verge of commercialisation, explain Carlos Ruiz, Martina Lyons, Isaac Elizondo Garcia and Zhaoyu Wu at IRENA. Though there’s enough Lithium in the world to support global electrification targets, tightening demand and supply chain constraints point at the urgent need for an alternative. The cost of a Na-ion battery cell is expected … [Read more...]
Electricity Market Design – creating the stimulus for competitive Offshore Wind within the internal energy market
Ahead of the upcoming discussion in Brussels (September 18, 15:00, Polish Embassy REGISTER HERE) on how to stimulate renewable investment, see below for a reminder of what was discussed at our conference before the summer. This time around, following an open address by Wanda Buk, VP Regulatory Affairs at PGE, PGE Baltica's CEO, Arkadiusz SeksciĹ„ski will be joined by Thor-Sten Vertmann, Electricity Market Design (EMD) expert within Ms Kadri … [Read more...]
Russia’s oil export revenue rebounded in March–April. Why aren’t the EU, U.S. and partners enforcing the price cap?
The Price Cap Coalition (PCC) - composed of Australia, Canada, the EU, Japan, the UK, and the U.S. – are failing to either enforce or lower the cap on Russian oil exports as promised, says a report summarised here from the Centre for Research in Energy and Clean Air (CREA). Had it done so, Russian revenues could have been slashed by €22bn (37%) since December by lowering the price cap for crude oil to $30/barrel and revising the caps for oil … [Read more...]
Will U.S. become the Global Gas Market’s source of flexibility and security of supply?
The U.S. will take the lead in offering flexibility and security of supply to the global gas market, and at prices linked to its wholesale gas market, the most liquid in the world, argue Kong Chyong and Ira Joseph at the Center on Global Energy Policy. It’s because the U.S. leads in the three key sources of gas trade flexibility, critical to meeting unexpected supply and demand gaps: natural gas storage systems, spare capacity in production and … [Read more...]
Evidence of a direct link between Wildfires and Fossil Fuel firms. Can it be used to sue them?
Wildfires are back in the news. The link to rising global temperatures caused by climate change is clear. Mark Specht at the Union of Concerned Scientists summarises their study that, for the first time, puts a number on the level of responsibility attributable to fossil fuel companies. Rising temperatures create a “vapour pressure deficit,” a measure of the power of the air to dry out plants and trees. That leads to an increase in the area … [Read more...]
U.S. Heat Pump adoption is evenly spread across rich and poor. Surprised?
The problem with subsidising first-adopters of new technologies is that they can substantially benefit rich households. They’re the ones who buy the first EVs, rooftop solar, etc. Lucas Davis at the Haas School of Business presents data that shows that, in the U.S., heat pumps are being bought evenly across the income distribution. This is a surprise, not least to the author! Nationwide, 15% of households have a heat pump as their primary heating … [Read more...]
U.S. EPA: new rules proposed for cutting Fossil Fuel-Fired Power Plant emissions
In May the U.S. Environmental Protection Agency proposed new rules regulating carbon emissions from fossil fuel-fired power plants. Here, four experts from the Center for Strategic and International Studies – Cy McGeady, John Larsen, Kyle Danish and Mathias Zacarias – make their assessment and point at the wide-ranging implications. The main issues covered include CCS, hydrogen-fuelled generation, state clean energy standards, carbon pricing, … [Read more...]
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