CHALLENGES OF INTEGRATING RENEWABLE ENERGY TECHNOLOGIES IN THE ENERGY SYSTEMS IN THE NEW EU-COUNTRIES
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1 CHALLENGES OF INTEGRATING RENEWABLE ENERGY TECHNOLOGIES IN THE ENERGY SYSTEMS IN THE NEW EU-COUNTRIES Dariusz Mikielewicz Gdansk University of Technology Faculty of Mechanical Engineering Heat Technology Department Baltic Sea States Sub-regional Co-operation operation Annual Conference
2 Outine of presentation 1. Overview of RES legislation in Poland. 2. State-of-the-art of RES in Poland 3. Successes in integration of RES 4. Survey of RES potential in Poland 5. Conclusions and challenges
3 Pomeranian Region: Area.: km 2 (5,6%) Population: 2,2 mln (5,6%) No. of dwellings: 0,692 mln (5,2%) Primary energy for heating -100 PJ (6,2%) Poland: Area: km 2 Population: 38.1 mln No. of dwellings: mln Density of population: 122 p/km 2 Production of electricity: TWh Generation per capita: kwh Primary energy for heating PJ
4 Important legislation Poland Energy Law, 10 April 1997 with amendments Strategy for development of renewable energy of 2001 Thermomodernisation Law of 18 December 1998 on supporting thermomodernisation activities with amendments of 2001, and directives to the Act of Ecological State Policy for years with account of perspectives for (document accepted by the Council of Ministers on 13 December 2006), National Energy Policy until 2030 Radical improvement of the effectiveness of primary energy utilisation contained in fuels by increasing the efficiency of energy conversion into heat and electricity, promotion of cogeneration and utlisation of waste heat
5 Obligations for Poland Attaining 6% reduction of carbon dioxide emissions in , 2012, with respect to 1988 A Frame Convention of United Nations on the issue of climate change together with the Kioto Protocol. Attaining 7,5% share of electricity produced in RES in domestic brutto consumption by the end of Directive 2001/77/WE of 27 September 2001 on supporting electricity produced from RES Attaining 5,75 % of biofuels share in liqud fuels by the end of 2010 Directive 2003/30/WE of 8 May 2003 roku on supporting use of biofuels and other renewables in transport.
6 New EU objectives for x 20% Reduction of greenhouse gases emissions by 20% with respect to the level of emissions from 1990, Share of renewable energy in the final energy balance to reach 20%, Reduction by 20% of energy consumption with regard to prognosis for 2020 as a result of increased energy efficiency, Share of biofuels in general consumption in transport fuels will be at least 10%.
7 Energy policy up to 2030 targets for RES 15% of RES in final energy consumption in 2020 and 20% in 2030 (15% is obeying the RES Directive) 10% of renewable energy in transportation fuels in 2020, implementation of 2nd generation biofuels Sustainable biomass production from agriculture and forestry (not to cause the food-energy conflict and to protect forest resources from intensive exploitation for energy purposes Supporting measures for RES Maintenance of RE certificates of origin (green certificates) Maintenance of tax relief for energy generated from RES - Implementation of support for RE heating and cooling - Implementation of a programme for agricultural biogas production - Support for offshore wind turbines - Financial support of new RE plants and development of electricity network - EU Cohesion Fund and Environmental Protection Fund - Stimulating development of Polish industry of RE technology EU Cohesion Fund
8 Specific conditions of Poland Over 90% of electricity in Poland is produced from coal, which contributes to significantly higher emissivity of CO 2 than other fuels, Obsolete technologies characterised by relatively small efficiency and higher CO 2 emissivity. At present Polish energy system has small power capacity surplus, which can lead to power shortages in years to come. The energy sector has too low economic potential to meet the demand of necessary investments. A weak transmission grid is not suited to cooperate with wind power, Limited range of investigations on the possibilities of utilisation of CCS.
9 Funding for renewable energy Operational Programme Infrastructure and Environment for Activity 9.4: Biomass, biogas, wind, solar, hydro, geothermal Activity 9.5: Transportation fuels Activity 9.6: Electricity network development for RE Activity 10.3: Industry for renewable energy production million 235 million 55 million 91 million Operational Programme Innovative Economy Innovation in renewable energy technology
10 Primary energy consumption Oil 23% RES 5% Hard coal 48% Natural gas 12% Lignite 12%
11 Production of electricity Energy generation Installed capacity Share GWh MW % Coal power plants Lignite power plants Gas power plants Hydro power Industrial power plants Wind and other RES TOTAL
12 Production of electricity
13 Renewable electricity installed capacity [MW] Biomass Biogas Hydro Wind Source: Energy Regulation Office Total electricity sales to end users in 2006 = GWh
14 Polish RES power sector in and GWh Biomass power 504 plant Biogas power plant 177 Wind power 257 Hydropower 2039 Co-firing 1314 TOTAL Installed capacity in Polish power plants: Installed capacity in Polish RES: 2007 GWh ~ MW ~1 500 MW 2008 GWh Biomass use: 70% - local heating 29% - electricity 1% - district heating
15 Renewable energy production Structure of renewable energy production, 2007 geothermal 0% w ind 1% biogas 1% liquid biofuels 2% geothermal 2% w ind 11% hydro 4% biogas 8% solid biomass 60% solid biomass 92% hydro 3% liquid biofuels 16% Renewable energy production: PJ Biomass use: 70% - local heating 29% - electricity 1% - district heating Structure of renewable energy production, 2020, 15%
16 Up-to-date achievements Emissions of greenhouse gases dropped by 32 % with respect to 1988 (base year for Poland) Share of RES in 2005 was 6,5% in the primary energy balance and 8,5% in the final balance Share of biofuels in transport in 2006 was 0,92%
17 Challenges in Polish power sector Average efficiency of Polish power plants is 36,5%, compared to 46,5% in EU-15 Polish energy use is 2,67 times less effective than EU-15 (444 to 166 toe/meuro GDP) Efficiency of Polish heat sources and heating systems is significantly lower than in EU-15 only 20% of district heating networks has preinsulated pipelines Thermal insulation of dwellings is poor ( kwh/m 2 /a), whereas in EU15 it is kwh/m 2 /a (with technical possibilities of reaching 15 kwh/m 2 /a) Weak utilisation of possibilites of development of rail and public transport excessive promotion of road transport
18 Effects of implementation of climate package for Poland Direct costs for the energy generation sector will be about 2 mld PLN in 2015 r. and will raise to the level of 8 mld PLN in 2020 r. and 15 mld PLN in 2030 Energy prices offered by producers will increase by 60% with respect to the base scenario (without climate scenario restrictions); The extent of production in the area of high energy-consumption sector will be lower by 8-24% than in the base scenario; In the case of households the effects will encompass slower pace of increase of free-income (by about 11%) and increase by up to 16% of the contribution of energy bill in the total structure of expenditure; Intermediate costs for the whole industry will render reduction of GDP level by about 154 mld PLN in 2020 and 503 mld PLN in 2030, (respectively 8 and 15% with respect to the base scenario) and reduction of annual average dynamics of industrial growth in the period by 0,5%.
19 Increase of energy prices Purchase requirement of CO 2 emissions at auctions Investments in RES Investments in modernisation of energy sector
20 Costs of end-user energy for households in EU with respect to the Purchase Power Potential (PPP) by Prof. K. Żmijewski among the 11 highest mar 2008 in the EU Rumunia Słowacja Polska Włochy Dania Bułgaria Portugalia Węgry Holandia Niemcy Litwa Szwecja Czechy Łotwa Estonia Belgia Cypr Słowenia Irlandia Hiszpania Austria Norwegia Malta Wielka Brytania Francja Finlandia Luksemburg Grecja Final electricity prices for households in PPP on 1 January 2007 (EUR/MWh) In terms of PPP, Polish power prices are
21 Directions for action Reduction of CO 2 emissions Change of energy mix Increase of RES share Improvement of effectiveness of energy utilisation Implementation of low emission technologies, including CCS In realisation of the above objectives there must be: Reduction of social costs to the acceptable minimum Ensuring of energy diversity security Sustaining competitiveness on the worls market Ensuring the optimal level of development Cooperation with society (education and awareness raising)
22 Co-firing in Poland present state 4% of RES electricity from co-firing = 69 PJ of chemical energy of supplied biomass = 9-10 m 3 of wood per annum to collect = additional 1-2 mln m 3 from forests and 7-9 mln m 3 of wood from plantations = about ha of new planting areas
23 Wind conditions in Poland Source: Institute of Meteorology and Water Management
24 Wind power in Poland ( ) 451 MW installed capacity 227 sources with concessions kw per person (one of lowest in EU) but 300% increase during 2 years 2020 = MW
25 INTERREG IIIC - REGENERGY
26 Offshore localisation of wind farms Source: Maritime Office km 2 (8,5%) Area possible for utilisation in Polish territorial waters
27 Challenges wind power lack of readily available information on other potential investments in the potential investment area, difficult and expensive access to geodetic and topographic maps, lack of information about flora and fauna in a given region, lack of available information whether the considered area belongs to Nature 2000 area, lack of definite information about applicability of a given area to potential investments in wind power.
28 Thermomodernisation fund Loan up to 80% of investment costs SPBT < 10 years Premium up to 25% of the loan Specification Structure of positively verified applications % Applications including: 100 Single houses 6,84 Multi-family houses 81,71 Local heat sources 0,85 Distribution networks 0,30 Other heat sources 0,08 Public utility buildings 9,34 Group living buildings 0,80 Others 0,08 Source: BGK as for
29 Number of applications for thermomodernisation premium
30 Thermomodernisation Fund Most active Regions Least active regions Mazowieckie Świętokrzyskie - 37 Wielkopolskie Podkarpackie Warmińsko-Mazurskie Opolskie Małopolskie Kujawsko Pom Łódzkie Lubuskie BGK as for r.
31 Pomeranian Region energy planning No. of municipalities 123 No. of developed assumptions for energy plans 110 (89%) National average 26% Planned activities: Thermomodernisation of existing public utility buildings, dwellings and industrial buildings Utilisation of locally available RES sources RES potential in Pomeranian Region 26% of heat demand
32 Pomeranian Region - thermomodernization strategy - reduction of heat demand indicator in multi-apartament buildings from 170 kwh/m 2 /a to 100 kwh/m 2 /a in 2025; - reduction of heat demand indicator in single family houses from 200 kwh/m 2 /a to 110 kwh/m 2 /a in 2025; - reduction of heat demand indicators in single family houses in rural areas from 230 kwh/m 2 /a to 140 kwh/m 2 /a in 2025; - reduction of energy demand indicator in public sector and commercial services by at least 28%-30% by 2025, with respect to the base year 2005*. * Regional Energy Strategy assumptions
33 Summary of effects of thermomodernisation law The law on thermomodernisation and related premium are attracting significant interest from investors. That is a result of ammendment introduced in 2001 as well as a significant reduction of interest rates on thermomodernisation loans and dissemination of information about the law and increase of public awareness. In first years after introduction of law it did not attract significant interest, however after 2001 when the way in which the thermomodernisation premium payment was changed (it is now deduced from the entire volume of the loan) it started to attract more investors. In years realised were 2500 investments for a total volume of 450 mln PLN and the awarded premiums were 76 mln PLN. Savings due to thermomodernisation reached 56 mln PLN per annum. Recently, 100 mln PLN per year, which terminate after two or three months.
34 Positive consequences of the law 1. Large volume of submitted applications for various kind of modernisations in all kind of buildings, strategy for the region. 2. All buildings equipped with metering devices. 3. Modernisations both on supply and end-user side. 4. Increase of awareness on energy conservation and its rational use. 5. Many investments carried out from investors own funds. 6. Increased interest in alternative sources of energy supply, eg. RES. 7. Several demonstration programmes of new technologies. 8. Other financial instruments to be available
35 Biogas potential in Poland MAIN BIOGAS SOURCES Municipal waste landfills Wastewater treatment plants Agricultural biogas plants Flora-based Animal-based
36 Biogass resources in Poland Biogass sources Biogass production million m 3 / year Municipal waste landfills Waste water treatment plants Agricultural biogas plants: flora based Agricultural biogas plants: animal based TOTAL Plan for Poland: construction of biogas plants by 2020 with total output power not less than 3 GW (2000 installations)
37 Challenges - biogas Lack of coherent biogas policy Comprehensive and not regulated authorization procedures Expensive import of technologies High costs - investment binds capital for a long time Low level of public awareness regarding renewable energy sources issues Sale of produced heat (CHP) is in many Polish regions a problem Lack of successful lessons (only TWO successful projects so far) BSR InnoNet Pilot Programme on Innovation Systems and Clusters (PIC), Gdańsk 2 April 2009
38 Solar conditions in Poland
39 Conclusions - challenges Lack of coherent legislation and procedures for development of RE technologies Biomass the most perspective fuel for fulfiling obligations Shortage of funding - high costs - investment binds capital for a long time, expensive import of technologies Co-firing biggest threat to development of RE technologies Nuclear power by 2023 Wind power receiving strong attention from government Energy saving investments: energy production consumption chain, thermomodernisation Promotion of new environmentally friendly society lifestyle low level of public awareness regarding RES issues
40 Thank you for your kind attention!
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