1. Support for low emission development in SEE: decarbonisation of the residential sector in Montenegro
Modelling:
Aleksandra Novikova, PhD | IKEM | University of Greifswald
Input information from the reports of:
Prof. Dr Zoran Miljanic , Biljana Gligoric, Prof. Dr Igor Vušanovic
Zsuzsa Szalay, PhD & Tamas Csoknyai, PhD | Budapest Technical University
Podgorica, 27 October 2015

2. Outline Objective Method and boundaries
Modelling steps, results and their discussion
Demographics
Buildings stock turnover
Energy consumption and CO2 emissions in the base year, calibration
Business-as-usual trends of energy consumption and emissions
SLED policy packages
Impact of policy packages and associated costs
Other possible scenarios and sensitivity analysis

3. Objective
To assist the design of energy efficiency and climate mitigation policies in the residential buildings of Montenegro with the information on:
What are the future trends of energy consumption and CO2 emissions? What are the key influencing factors? What are the priority sector segments for policies?
What kind of policy packages and what level of policy efforts are required to make the residential buildings low energy/carbon in the medium/long term future? What are the associated costs? How high are possible energy savings and CO2 emission reduction?

4. Architects & policy experts Economists & policy experts
Modelling steps
Bottom-up approach
Architects & policy experts
Economists & policy experts
Step 1: Development of the buildings topology
Step 5: Construction of the buildings stock model
Step 2: Calculation of the present buildings performance
Step 6: Construction and calibration of the energy sector balance in
Step 3:
Calculation of possible retrofit packages (BAU, standard, ambitious)
Step 7: Calculation of baseline energy consumption and CO2 emissions until 2030
Step 4: Calculation of costs for retrofit packages
Step 8: Formulation of policy packages, evaluation of their impact and associated costs

5. Only thermal comfort is included into our analysis
Model boundaries
Only thermal comfort is included into our analysis
Space heating, space cooling, and water heating
Building categories falling out
Vacation buildings (not covered by the EPBD)
Retrofit options: energy efficiency and fuel switch
No impact of climate change

6. Modelling tool
LEAP is a widely-used software for energy policy analysis and climate change mitigation assessment developed at the Stockholm Environment Institute

7. Objective
To assist the design of energy efficiency and climate mitigation policies in the residential buildings of Montenegro with the information on:
What are the future trends of energy consumption and CO2 emissions? What are the key influencing factors? What are the priority sector segments for policies?
What kind of policy packages and what level of policy efforts are required to make the residential buildings low energy/carbon in the medium/long term future? What are the associated costs? How high are possible energy savings and CO2 emission reduction?

8. Demographics Population Persons per household
Until 2030: the energy development strategy of Montenegro by 2025, medium scenario
2031 – 2050: the continuation of trends
Persons per household
3.2 in 2011 (CENSUS)
2.7 in 2050, 2.5 in 2070 ( 2.0 in 2050 in Europe, European Commission (2011): WETO-T)
The number of inhabited dwellings almost equals the number of households
European Commission World and European Energy and Environment Transition Outlook (WETO-T). Bertrand Château and Domenico Rossetti di Valdalbero (Eds.)

9. Buildings stock evolution

10. Buildings stock demolition
The demolition of the buildings stock is assumed to occur according to the Weibull curve
% left = exp (-(t+c)/a)^b, where
t- year
a - scale factor
b - shape factor, assume 2.5
c - location parameter, assume 0
Only inhabited buildings were analyzed
Estimated mean buildings lifetime, years
A1. Built
A2. Built
A3. Built
A4. Built
A5. Built
A6. Built 2016…
Dwelling construction is estimated as the gap between the demand for dwellings and the remaining dwellings stock
Take the lifetime from Serbia? The same buildings categories

11. Buildings stock replacement
Fig. Age category A. Buildings built before 1945

12. Objective
To assist the design of energy efficiency and climate mitigation policies in the residential buildings of Montenegro with the information on:
What are the future trends of energy consumption and CO2 emissions? What are the priority sector segments for policies?
What kind of policy packages and what level of policy efforts are required to make the residential buildings low energy/carbon in the medium/long term future? What are the associated costs? How high are possible energy savings and CO2 emission reduction?

13. Buildings stock replacement
The growth in new floor area (1-1.6% yr.) is due to
The demolition rates of old buildings (+)
The growing number of households (+)
More large houses, where floor area per dwelling is smaller than that in small houses (-)
The larger floor area of new dwellings (+)

14. Changing structure of the floor area by building type

15. Calibration

16. Calibration for thermal comfort
Floor area heated
55%
´The duration of heating
16 hours
Floor area cooled (zones 1 and 2)
50%
The duration of cooling (zones 1 and 2)
12 hours
Billion kWh = TWh
Electricity for appliances and cooking is about 25% of the total sector balance

17. Uncertainty about the balance for the residential sector
The buildings sector balance (MONSTAT 2014) x the share of the household sector in the buildings sector in the Montenegrin strategy to 2030

18. Objective
To assist the design of energy efficiency and climate mitigation policies in the residential buildings of Montenegro with the information on:
What are the future trends of energy consumption and CO2 emissions? What are the key influencing factors? What are the priority sector segments for policies?
What kind of policy packages and what level of policy efforts are required to make the residential buildings low energy/carbon in the medium/long term future? What are the associated costs? What are the associated costs? How high are possible energy savings and CO2 emission reduction?

19. Business-as-usual scenario
The buildings retrofit rate is 1% of the old stock/yr.
Only the first happening retrofit is considered, this is why the model shall not be used for the analysis to the long-term
Business-as-usual retrofit
20% energy demand reduction
Some fuel switch: after retrofit, households in old buildings start heating with the same energy sources as households in new buildings of the same building type
More cooling, 100% penetration of air-conditioners
No other policies than the acting buildings code (2003) are in place

20. BAU: Final energy consumption by energy source
12%
FEC – final energy consumption

21. Baseline: Final energy consumption by buildings age categories

22. Only for orientation and setting priorities
Baseline: Final energy consumption by building type
From the long-term perspective, the key categories for policy making are new buildings and those built in
Only for orientation and setting priorities

23. Baseline: Final energy consumption by building type
The priority segment: small buildings

24. Baseline: Final energy consumption by climate zone

25. Baseline: Final energy consumption by end-use
Space heating will remain to be the largest energy end-use
Shall we increase the correction factors for cooling in BAU?

26. Baseline: direction and indirect CO2 emissions

27. Objective
To assist the design of energy efficiency and climate mitigation policies in the residential buildings of Montenegro with the information on:
What are the future trends of energy consumption and CO2 emissions? What are the key influencing factors? What are the priority sector segments for policies?
What kind of policy packages and what level of policy efforts are required to make the residential buildings low energy/carbon in the medium/long term future? What are the associated costs? Which energy savings and emission reductions are possible?

28. Policy packages
Objective: low energy/carbon stock in the medium/long term
Policies: regulatory, financial incentives, market based, information. Regulatory the most effective costs effective

29. SLED scenarios Reduction of energy demand Fuel switch
Increase in the level of comfort, heating
Longer duration of heating (18 hours)
Larger floor area heated (70% floor area heated)
Increase in the level of comfort, cooling
Longer duration of cooling (14 and 16 in standard and ambitious improvement)
Larger floor area cooled (55/60% floor area cooled in standard and ambitious improvement)

30. Objective
To assist the design of energy efficiency and climate mitigation policies in the residential buildings of Montenegro with the information on:
What are the future trends of energy consumption and CO2 emissions? What are the key influencing factors? What are the priority sector segments for policies?
What kind of policy packages and what level of policy efforts are required to make the residential buildings low energy/carbon in the medium/long term future? What are the associated costs? Which energy savings and emission reductions are possible?

31. Final energy consumption
SLED Moderate: Low energy/carbon buildings stock in 2070
Final energy consumption
17%

32. SLED Moderate: Final energy savings by energy source

33. SLED Moderate: electricity savings
33%

34. SLED Moderate: Final energy savings by building age category

35. SLED Moderate: Final energy savings by building type

36. SLED Moderate: Final energy savings by climate zone

37. SLED Moderate: Final energy savings by end-use

38. SLED Moderate: final energy consumption per m2
17%

39. SLED Moderate: Avoided CO2 emissions
33%

40. Objective
To assist the design of energy efficiency and climate mitigation policies in the residential buildings of Montenegro with the information on:
What are the future trends of energy consumption and CO2 emissions? What are the key influencing factors? What are the priority sector segments for policies?
What kind of policy packages and what level of policy efforts are required to make the residential buildings low energy/carbon in the medium/long term future? What are the associated costs? Which energy savings and emission reductions are possible?

41. Assumptions Financial analysis Energy prices
Discount rate 10% (could very from 1% to 15%)
Market loan rate 10%
Subsidized loan rate to 0%
Loan term 10 years
Energy prices
Electricity 0.10 EUR/kWh
Growth rates 0.8%/yr. in , 1.2%/yr. in , and 1% in
Wood 40 EUR/m3 = 0.04 EUR/kWh
Growth rates 1.5%/yr.

42. Affected floor area: new buildings

43. Affected floor area, retrofit of existing buildings

44. Incremental cost per m2
The largest share of the cost is for insulation, then window replacement and the exchange of heating systems

45. Incremental investment (SLED – BAU)
GDP Albania = 13 billion USD

46. Costs of the grants (for the government)

47. Loans: costs for the government – “buy-down” rate
Add the costs of loans for the households

48. Costs of the building codes (for households)

49. Saved energy costs

50. Profitable investment
Annualized investment cost 17 EUR/m2 vs saved energy costs 70 EUR/m2 (discount rate 10%, lifetime 20 years)
Investment until 2030 are 980 million EUR (not discounted), saved energy costs are ca. 290 million EUR and will last for many years ahead

51. Final energy consumption
SLED Ambitious: Low carbon buildings in 2050, retrofit rate 2%
Final energy consumption
26%

52. SLED Ambitious: Low carbon buildings in 2050, retrofit rate 2%
Electricity savings
47%

53. Affected floor area: new buildings

54. Affected floor area, retrofit of existing buildings

55. SLED Ambitious: Low carbon buildings in 2050, retrofit rate 2%
Incremental investment (SLED – BAU)
GDP Albania = 13 billion USD

56. SLED Ambitious: Low carbon buildings in 2050, retrofit rate 2%
Total investment (without BAU) -> combining deep thermal efficiency retrofit with the BAU retrofit activities is critical
GDP Albania = 13 billion USD

57. SLED Ambitious: Low carbon buildings in 2050, retrofit rate 2%

58. SLED Ambitious: Low carbon buildings in 2050, retrofit rate 2%
Annualized investment cost 17 EUR/m2 vs saved energy costs 73 EUR/m2 (discount rate 10%, lifetime 20 years)
Investment until 2030 are 1,4 billion EUR (not discounted), saved energy costs are ca. 440 million EUR and will last for many years ahead

59. Other scenarios and sensitivity analysis