1. Electrification of heating and transport consequences for gas consumption, emissions and costs
MACHIEL MULDER
Centre for Energy Economics Research
Faculty of Economics and Business, University of Groningen
Joint research with Jose Moraga (VU Amsterdam), Chloé le Coq (Stockholm) en Sebastian Schwenen (München)
on request of CERRE (Centre on Regulation in Europe, Brussel)
Energy Days: climate policy and energy markets
TU Eindhoven, 28 March 2019

2. Outine Method Scenarios Results electricity consumption & generation
gas consumption & supply
costs
CO2 emissions
Conclusions

3. Policy objectives wrt electrification in period to 2050
Number of houses and cars by type, energy use and electrification in 2016
Annual change in number of houses and cars
Investments in electrification in residential buildings and road transport
Electrification scenarios
Annual electrification in residential buildings and road transport
Annual consumption of fossil fuels in residential buildings and road transport
Annual emissions of CO2
Extra annual electricity consumption because of electrification
Investments in electricity network
Impact of electrification on annual
natural-gas consumption
total system costs
emissions of CO2
Autonomous annual change in remaining electricity consumption
Annual electricity consumption
Annual natural gas consumption
Investments in natural-gas network
Actual level of electricity consumption in 2016
Annual and seasonal generation by gas-fired power plants
Investments in gas-fired power plants
Annual supply of methane through electrolysis
Actual composition of electricity generation in 2016
Annual electricity generation by conventional plants (except gas plants)
Annual electricity generation by renewable techniques (wind and solar)
Annual net imports
Seasonal demand and supply of power from Power-to-Gas
Investments in Power-to-Gas equipment
Policy objectives wrt electricity generation in period to 2050

4. Scenarios

5. Data and assumptions on residential houses
Statistical data for 2016
Assumptions on energy use for period to 2050
Variable
Value
Number of houses (x million)
7,6
Number of houses electrified (x million)
0,02
Average size of houses in m2
119
Average gas consumption per house (m3)*
1400
share of gas used for cooking** 5%
share of gas used for hot water**
15%
Share of houses connected to district heating system
5.5%
CO2 emissions by households in 1990 (Mton) 21
Variable
Value
Annual increase in number of houses
0,5%
Annual number of new houses (x 1000) 50
Energy use for heating a new house (in m3 gas)
1000
Annual increase in efficiency houses 1%
Coefficient of performance (COP) of heat pumps
Space heating 3
Warm water 1
Annual increase in efficiency of heat pumps
Sources: CBS, RVO

6. Electrification of residential houses, 2016-2050, 2 scenarios

7. Consumption of electricity in houses, for heating, cooking and hot water, in 2050

8. Data and assumptions on road transport
Assumptions on energy use for period to 2050
Statistical data for 2016
Variable
Value
Passenger cars
Annual number of new cars (x 1000)
400
Performance electric (kWh/100km) 20
Vans
Annual number of new vans (x 1000) 60 35
Trucks
Annual number of new trucks (x 1000) 10 70
Buses
Annual number of new buses (x 1000)
0,75
100
Motorbikes and scooters
Annual number of new M&S (x 1000) 75 5
Bicycles
Annual number of new bicycles (x 1000)
1000 1
All vehicles
Annual increase in number 1%
Annual increase in efficiency
Annual increase in average distance per vehicle 0%
Battery charging units
Annual improvement in charging efficiency
0,5%
Variable
Value
Number of (x million)
passenger cars
8,9
vans
0,84
trucks
0,15
buses
0,01
motorbikes and scooters
1,15
bicycles
22,7
Of which electric (x 1000) 60
0,1
1500
Average distance per year (km)
13022
18896
59228
61461
2000
1000

9. Electrification of road transport, in 2050 (per scenario)
% of full
electric cars

10. Consumption of electricity by road transport, in 2050, per scenario

11. Autonomous growth in electricity consumption: 0.6% per year since 2000
Assumption for period up to 2050: 0.5% growth per year

12. Consumption of electricity, total Netherlands,
autonomous + effect electrification in 2050, per scenario

13. Supply of electricity: assumptions
Capacity factor: wind: 40%, solar: 25%
(more than in publication)

14. Supply of electricity, 2016-2050 (aggregated numbers per year)

15. …but what to do with fluctuations in generation and load?
distribution of joint weather circumstances over past 6 years
hardly wind
hardly sunshine
cold (= high demand for heat)
working days (high demand for power)
a lot of wind
a lot of sunshine
normal temperature (low demand for heating or cooling)
weekends (low demand for power)

16. Supply of electricity on extreme days
Hardly wind and sunshine, high heating demand,
working day
A lot of wind and sunshine, no heating demand,
weekend
Solar, wind and biomassa generate more than needed:
storage of power as hydrogen (Power-to-Gas)
Supply of electricity from storage, wind, solar, biomass
and import not sufficient to satisfy demand:
gas fired power plants are required

17. Storage of power as storage for seasonal flexibility (PtG)
Assumptions on efficiency PtG

18. Gas-generation capacity needed on worse day

19. Consumption of gas in houses and electricity sector
Full electrification scenario
All scenarios in 2050
Assumption: gas-fired power plants realise 1% efficiency improvement per year

20. Total consumption of gas in the Nederlands
Assumptions on industry: 1% efficiency improvement per year – no hydrogen or elektrification

21. Supply of gas to the Dutch market, 2016-2050
Statistical data
Assumptions

22. Supply of gas to the Dutch market, 2016-2050

23. Reduction CO2 emissions compared to 1990
Statistical data
Assumptions

24. Emissions of CO2 by road transport, residential buildings and electricity sector

25. Emissions of CO2 per sector per scenario

26. Reduction CO2 emissions compared to 1990
T+R
(2050)
T=Transport
R=Residential sector
E=Electricity sector

27. Assumptions for calculating costs Variable Value
Weighted Average Costs of Capital (WACC) 5%
Discount rate (for NPV calculations) 3%
Depreciation periods (years)
- grid 20
- power plants
- houses 40
- cars 10
Investments costs:
- gas-fired power plants (mln euro/MW)
0,75
- electrolyser (mln euro/MW)
0,5
- storage (caverne) 30
Asset value electricity grid (billion euro) 28
Investment costs residential buildings
- heat pump (euro / house)
6000
- renovating house (euro/m2/house)
105
Investments costs road transport
- quick charging stations (per unit)
35000
- ratio charging stations / cars
0,08
- extra costs of electric cars (euro/car)
7500
Gas price (Euro/MWh)
annual change in gas price 0%
Price motor fuels (Euro/lt, excl taxes)
annual change in price motor fuels
shadow price of CO2 (euro/ton) 50
CO2 price in ETS (euro/ton)
Assumptions for
calculating costs

28. Costs of electrification, per type of costs

29. Costs: present value of all costs during period to 2050

30. Sensitivity analysis Legenda:
'higher efficiency': annual improvement in the energy
efficiency of houses, vehicles and electricity generation
is 2 times baseline
'more renewables': annual increase in wind turbines and
solar panels is 2 times baseline
'stable demand': no increase in number of houses and
cars and autonomous electricity demand remains constant
'all 3': all the above 3 variants combined

31. Conclusions
electrification results in much higher demand for electricity
increasing supply of renewables is not sufficient to meet this demand
even on windy and sunny days, there will hardly be oversupply
renewable energy should increase much stronger before we can realise a green hydrogen economy
hybrid systems are less expensive than full electrification

32. References
CERRE, Gas and elektrification of heating & transport, scenarios for 2050
(including studies for Netherlands, Germany, Austria, Belgium and France)
Study on the Netherlands (extract of CERRE report):
Moraga en Mulder, Electrification of heating and transport: a scenario analysis of the Netherlands up to 2050,
CEER policy papers, 2, May 2018.