8

Benchmarking

A literary review of relevant external studies is a best practice approach when undertaking a complex task such as developing scenario for ENTSOG and ENTSO-E and EU28 perimeter. The purpose of the exercise is to understand whether or not the input assumptions and methodologies that ENTSOs employ result in credible and plausible outcomes compare to other expert opinion and methods.

As part of our internal quality process for scenario building, ENTSOG and ENTSO-E have compared their TYNDP 2020 Scenarios to the European Commission’s Scenarios:

  1. EUCO32/32.5 scenario (EC, 2018).
  2. A Clean Planet for all – A European long-term ­strategic vision for a prosperous, modern, competitive and climate neutral economy” (EC, 2018), in particular with
    1. Baseline Scenario (“Baseline”
    2. 1.5TECH Scenario (“1.5TECH”)
    3. 1.5LIFE Scenario (“1.5LIFE”)

It is acknowledged that there are different approaches and purposes for both listed studies. The studies each have a view on the EU28 electricity and gas sectors. It is possible to create plausible ranges for scenario parameters such as, low to high ranges for demand; EV uptake, Heat Pump uptake; installed capacity for generation, low to high range gas for imports etc. In the following sections ENTSOs have focused their benchmarking on the overall electricity and gas demand, electrification and gas supply.

8.1 Final Electricity Demand

The highest final electricity demand corresponds to Distributed Energy, with the actual growth being due to the very strong increase in electric vehicles and heat pumps. The Global Ambition scenario has the lowest final electricity demand, due to the higher gas share.

Figure 37

Figure 37: Benchmarking of projected electricity demand and wind/solar generation for EU28

Electrification rates

The final electricity energy demand divided by final energy demand indicates the direct electrification of different scenarios. The general increase in the share of electricity in final use demand, illustrates that electrification is one key driver trying to achieve a sufficient decarbonization up to 2050. The electrification trajectories of the TYNDP 2020 scenarios 3–4 percentage points above or below the EC LTS 1.5 scenarios. As displayed for the year 2050, the Distributed Energy scenarios achieves an electrification rate of 54 % points above the 1.5TECH scenario. The Global Ambition scenario achieves an electrification rate of 47 %, 2 points below the 1.5LIFE scenario .

The sectorial breakdowns of the industry, residential and commercial sectors illustrate that the COP21 scenarios are, with regard to electrification, in the order of magnitude compared to the EC LTS scenarios.

A similar statement can also be made to the transport sector for the mid-term horizon (2030 and 2040), where the electrification is in the ballpark of other external scenarios. For 2050, the transport electrification in ENTSOG and ENTSO-E COP21 scenarios matches the EC’s 1.5TECH scenario.

Figure 38

Figure 38: Benchmarking of projected electrification rate for EU28

Figure 39

Figure 39: Benchmarking of projected electrification in the industrial sector for EU28

Figure 40

Figure 40: Benchmarking of projected electrification of residential and commercial sectors in EU28

Figure 41

Figure 41: Benchmarking of projected electrification in the transport sector for EU28

8.2 Gas demand

Although ENTSOs scenarios follow their specific assumptions and methodologies, they are designed to meet the same EU climate objectives as other external scenarios.

ENTSOs scenarios in the range of EC ­scenarios

In the timeframe 2020–2040, National Trends projects ca. 10 % higher gas demand than EUCO32/32.5 and the Baseline scenario. Part of the difference can be explained by national coal-phase out policies captured by National Trends taking into account latest information from the NECPs or national climate strategies (such as the German coal-phase out).

In 2050, Distributed Energy reaches the EU climate targets with 3,000 TWh ranging between 1.5TECH and 1.5LIFE. Global Ambition reaches the same objectives with a gas demand of 3,800 TWh, ranging above 1.5TECH.

Figure 42

Figure 42: Total primary gas demand – Benchmark with EC Long Term Strategy

Gas demand for final use and for power ­generation follow different evolutions

When looking into the gas demand more in detail, the total gas demand (methane and hydrogen) can be divided in the gas demand for final use, where gas is directly used as energy (in residential, tertiary, industry and transport) or as feedstock (only industry) and the gas demand for power generation, where the gas is converted into electricity in power plants, CHP or in the long run fuel cells.

Till 2025, all TYNDP scenarios show high alignment with the EUCO32/32.5 scenario for both demand categories. For 2030, The TYNDP scenarios show different demand developments compared to the EUCO32/32.5 scenario.

  • Final demand: With regard to the gas final demand, the TYNDP Scenarios consider more gas in sectors such as transport and industry compared to the EUCO32/32.5 scenario, which also lead a slightly higher demand.
  • Power Demand: In case of National Trends, the difference can be explained by recently stated policies and their reflection in the NECPs. In case of Distributed Energy and Global Ambition, the reason is two folded: both scenarios combine a higher electricity demand with an early coal-phase out. The combination leads to an increasing role for gas in power generation.
Figure 43

Figure 43: Primary gas demand for final use and for power generation

8.3 Renewable gas supply

The renewable gas production in the next thirty years can be divided in three different categories: production of biomethane, Power-to-Methane (P2CH4) and Power-to-­Hydrogen (P2H2).

Biomethane in the range of EC LTS ­scenarios and Gas for Climate study

Biomethane generation in Global Ambition is comparable to 1.5TECH and 1.5LIFE scenarios of EC LTS, whereas Distributed Energy considers a higher generation of biomethane within the EU comparable to the P2X scenario. with National Trends having the most limited penetration of biomethane, all scenarios are therefore in the range of the EC Long-Term Strategy. Additionally, Distributed Energy shows comparable generation to the Gas for Climate study by Navigant (1,200 TWh in gross calorific value).

Power-to-gas sees a limited development compared to EC LTS

As a result of the assumptions on the generation potential as well as the development rate of P2G technologies, ENTSOG and ENTSO-E scenarios all look more conservative than EC LTS, explaining the limited gap between the overall indigenous generation considered in EC LTS and ENTSOs scenarios.

Figure 44

Figure 44: Renewable gas production – ENTSOs vs EC LTS (P2X, 1.5TECH, 1.5LIFE)

8.4 Energy imports

The figure below compares the energy import in 2050 between ENTSOs and EC LTS scenarios. As Distributed Energy focuses on higher European self-sufficiency, this scenario foresees the lowest levels of energy import. Even well below the energy imports in the EC LTS scenarios. Total energy import in Global Ambition is quite comparable with both 1.5TECH and 1.5LIFE scenarios.

The type of energy carrier, which are imported differ, however. Compared to the EC scenarios, Global Ambition foresees less import of oil and more import of ( renewable ) gas. The higher gas import however stems explicitly from the scenario storyline of this scenario. Furthermore, compared to the LTS baseline scenario the gas imports in Global Ambition are still reasonable.

Figure 45

* decarbonised, either by natural gas imports with post-combustive CCU/s or any other technology
** natural gas converted to hydrogen at import point/city gate or direct hydrogen imports

Figure 45: Energy imports in 2050 by energy carrier

Figure 46 presents the developments of gas imports over time. Although gas import might see limited increase in the next five years, all scenarios foresee a decrease in gas import after 2025. With high shares of indigenously produced renewable gases, Distributed Energy shows alignment with EC’s most ambitious 1.5TECH Scenario. On the other hand, Global Ambition shows a balanced development of gas imports on a trajectory which seems similar to the NECP based National Trends.

The difference in imports for 2020 reflects the recent reduction of Groningen field production decided by the Netherlands, which is not considered in the other external scenarios ( EUCO32/32.5 in particular ).

Figure 46

Figure 46: Gas imports per scenario and per year

8.5 Carbon Capture and Storage

Both Distributed Energy and Global Ambition scenarios show an increased application of carbon capture and storage (CCS). Distributed Energy foresees about a growth of up to 130 MT per year in 2050. This is slightly above EC LTS 1.5LIFE, but well below EC 1.5TECH. Global Ambition does exceed EC LTS scenarios however. But in comparison with for example Gas for Climate (Navigant) the amount CCS in this scenario still seems reasonable.

Figure 47

Figure 47: CCS in 2050 in ENTSOs and EC scenarios

8.6 Conclusion

Benchmarking the demand, renewable generation and electrification with the most important reference studies illustrates the reasoning behind then TYNDP 2020 Scenarios in their assumptions and methodologies. National Trends is based on the national policies towards meeting the EU’s climate targets for 2050. However, the benchmark confirms both Global Ambition and Distributed Energy scenarios to be plausible pathways towards meeting the COP21 targets considering contrasted evolutions of the energy system.

ENTSOs scenarios robust and fit for purpose

The contrasts in demand and production technologies as well as the centralised/de-centralised approach to the development of renewable technologies and its impact on the energy imports make ENTSOG and ENTSO-E scenarios the best support for assessing the infrastructure needs of the energy system for the next decades.