1. DAC PROJECT Capacity Building in Balcan Countries for the Abatement of Greenhouse Gases Setting priorities for GHG emissions reduction George Mavrotas NATIONAL TECHNICAL UNIVERSITY OF ATHENS Tirana – 08.04.2002

2. DAC Project / Tirana, 08.04.2002 Structure of the presentation Analysis of the current situation – Recognize priorities Indicative measures and policies Evaluation of the measures Priorities according to local experts Concluding remarks

3. DAC Project / Tirana, 08.04.2002 Contribution of Greenhouse Gases in the EU

4. DAC Project / Tirana, 08.04.2002 Focus: Energy sector CO 2 emissions from the energy sector

5. DAC Project / Tirana, 08.04.2002 Power generation characteristics Installed capacity 1446 MW hydro power 35 MW thermal power Production 99% from hydro power (normal year: 4300 GWh) Recognized problems High T&D losses (~25%) Strong dependence on hydrological conditions

6. DAC Project / Tirana, 08.04.2002 Measures and Policies for Electricity Generation The future Further exploitation of hydro potential (now only 35%) It is unavoidable to cover the increased electricity demand by thermal power plants (TPP) in order to enhance the security of supply (diversification of power supply mix) Forecasted capacity of TPP till 2020 ~850 MW Share of TPP production ~40% in 2020 High Priority Reduce T&D losses Clean and efficient technologies for TPP units Natural gas > Oil > Coal

7. DAC Project / Tirana, 08.04.2002 Measures and Policies for the Demand Sectors The aim should be 3-fold: To increase energy efficiency through minimisation of energy losses To upgrade existing infrastructure with new appliances/equipment To introduce cleaner fuels and renewables

8. DAC Project / Tirana, 08.04.2002 Measures and Policies for the Residential & Tertiary Sector Reduction of thermal losses in existing buildings (insulation + double glazing) Updating building specifications for new buildings Buildings shading Use of low energy lamps Use of efficient domestic appliances Solar water heating systems Penetration of natural gas District heating CHP in large buildings (hotels, hospitals, etc)

9. DAC Project / Tirana, 08.04.2002 Measures and Policies for the Industrial Sector Improved maintenance of energy equipment Energy conservation (reduction of losses) Substitution of solids and oil with natural gas Cogeneration with natural gas Exploitation of biomass (agricultural residues)

10. DAC Project / Tirana, 08.04.2002 Measures and Policies for the Transport Sector Improved maintenance of private cars, trucks and buses Improvement of road network Improvement in traffic lighting Promotion of public transport Increased natural gas in public transport

11. DAC Project / Tirana, 08.04.2002 Evaluation of measures Cost estimation Cost per ton of CO 2 saved (specific cost) Contribution to CO 2 emissions abatement Marginal abatement cost curve Additional criteria Ease of implementation (missing infrastructures, administrative-legislative barriers) Environmental synergies Impact on employment and regional development

12. DAC Project / Tirana, 08.04.2002 Cost per ton of CO 2 saved Comparison with the relative baseline scenario option Specify the reference unit (e.g. 1 household) and the reference time period (e.g. 1 year) Cost and CO 2 emissions estimation for the baseline scenario option (without the measure) Cost and CO 2 emissions estimation with the measure implementation

13. DAC Project / Tirana, 08.04.2002 CO 2 abatement estimation Specify the target year Assume a penetration rate of the measure at target year Estimate the CO 2 abatement at target year: CO2ab=(CO2 b -CO2 m ) ref_unit units targ_year penetration_rate

14. DAC Project / Tirana, 08.04.2002 Evaluation of the measures: The case of Albania Quantification of 26 measures in the energy sector Residential sector: 9 Services:3 Industry:5 Transport:1 Agricultural:1 Energy Transformation:7

15. DAC Project / Tirana, 08.04.2002 Ranking according to the specific cost of measures

16. DAC Project / Tirana, 08.04.2002 Ranking according to the CO 2 abatement in 2020

17. DAC Project / Tirana, 08.04.2002 Marginal abatement cost curve for 2020

18. DAC Project / Tirana, 08.04.2002 Comments Almost all the studied measures are beneficial even from a financial point of view Mostly energy conservation measures and some fuel- switch In 2020 the potential of CO 2 emissions abatement is about 7 Mt. It can be attained with measures that are also economical acceptable.

19. DAC Project / Tirana, 08.04.2002 Example: Economy lamps Baseline scenario: Incandescent lamps Base of calculations: 1 typical household (100 m 2 ) Reference time period: 1 year Incandescent lamps Economy lamps Lighting power350 W63 W Annual consumption (2.5h/day)315 kWh57 kWh Price of 1 lamp (100W 18W) 1.1 18.9 Lifetime~ 1 year~ 8 years

20. DAC Project / Tirana, 08.04.2002 Example: Economy lamps (2) Annualized cost per lamp: Incandescent: 1.1 Economy lamp:CRF(5%, 8 years) 18.9 =0.155 18.9 = 2.93 Annualized cost per household: Incandescent:5 lamps/household 1.1 /lamp = 5.5 Economy lamps: 5 lamps/household 2.93 /lamp = 14.7 Annual electricity cost (~ 0.098 /kWh): Incandescent:0.098 /kWh 315 kWh = 30.9 Economy lamps: 0.098 /kWh 57 kWh = 5.6

21. DAC Project / Tirana, 08.04.2002 Example: Economy lamps (3) Total annual cost per household: Incandescent:5.5 + 30.9 = 36.4 Economy lamps:14.7 + 5.6 = 20.3 Power generation data Transmission losses: 15% Average emission factor (2020): 0.263 kg CO 2 /kWh Power generation CO 2 emissions per household Incandescent:0.263 315/(1- 0.15) = 97 kg CO 2 Economy lamps:0.263 57/(1- 0.15) = 18 kg CO 2

22. DAC Project / Tirana, 08.04.2002 Example: Economy lamps (4) Abatement cost: (20.3 – 36.4) / (97 kgCO 2 – 18 kgCO 2 ) = -204 / tCO 2 Number of households in 2020: ~ 1,440,000 Penetration of the measure until 2020: ~ 50% CO 2 abatement in 2020: 1,440,000 (97 kgCO 2 – 18 kgCO 2 ) 0.5 = 56.9 kt CO 2

23. DAC Project / Tirana, 08.04.2002 Priorities according to local experts (Oct. 2001)

24. DAC Project / Tirana, 08.04.2002 Questionnaire results (2)

25. DAC Project / Tirana, 08.04.2002 Questionnaire results (3)

26. DAC Project / Tirana, 08.04.2002 Questionnaire results (4)

27. DAC Project / Tirana, 08.04.2002 Concluding remarks Priorities: Further exploitation of natural gas Secure electricity supply with TPP using clean fuels Energy conservation Exploitation of renewable energy sources Criteria for the evaluation of measures Cost per ton of CO 2 saved CO 2 abatement for target year Applicability, synergies, employment Current phase in Task 3 of DAC project: quantification of the measures