In the lead up to our Visualizing Energy Forum & Exhibition taking place during the EU Sustainable Energy Week, Revolve is presenting a series of insights with key European thought leaders. Last week, we posted the responses from MEP Bendt Bendtsen of Denmark.
To continue the series, we talked with MEP Morten Helveg Petersen (also of Denmark) about the role of the EU Internal Energy Market and the technologies that are facilitating Europe’s energy transition.
How is Europe leading the energy transition?
Europe was quick to recognize the urgent need of transforming the energy system. By promoting development of key technologies and by committing to binding climate and energy targets, the transition towards larger shares of renewable energy sources and more decentralized electricity supply has so far been a success story. We’ve placed Europe in a leading position of the energy transition, but that can change in a heartbeat if we do not keep innovating and investing in the energy system. Then it will be history rather than a story to be continued.
Going forward, we face many challenges that come with an increasingly complex energy and electricity market. A continuously growing share of fluctuating renewable energy sources, an increase in cross-border interactions, and the larger distance from source to load are the main challenges. If we want to maintain Europe as a frontrunner in the energy transition and deliver on our commitments, we need to come up with new and innovative solutions that respond with the flexibility needed
What are the biggest challenges for the transformation of the European energy system?
The biggest challenge is to transfer our commitments into real action, into enforceable, reachable, and yet ambitious goals. The Commission has launched the Clean Energy for All Europeans package for that sole purpose. The proposals are going in the right direction, but they could have gone even further. In fact, they should have gone much further.
It is now up to us, The European-Parliament, to make the case for a more optimistic, more radical, and fundamentally more ambitious transition. If we get it right, it will be the foundation for a much-needed single energy market in Europe. If we fail, it will lead to a halt of innovation, the loss of thousands of new jobs, a continuous EU-import of Russian gas and of oil from the Middle East. And we will continue to exacerbate climate change. The pressure is on, but we are up for the challenge. All the arguments are there to support the transition to a better European Energy system that delivers clean energy for all European citizens
How can Europe accelerate the consolidation of the internal EU energy market?
It all comes down to two things: how to create the right conditions to support the regional cross-border energy trade, and how we make full use of the energy supplied.
In light of the increasing inclusion of renewable energy sources, we need more coordination to avoid the continuance of cross-border issues caused by basic protectionism. Why do we have very costly, often very inefficient and unnecessary energy usage, when there is a real opportunity for clean and inexpensive energy to flow freely from the North to South, from West to East and vice versa?
On the demand side, it is crucial to use energy in the smartest and most efficient ways. Increasing the energy performance of buildings is one of the most obvious ways to improve this. We have to find the right balance between ambition – in terms of renovating our buildings – and financing – which needs to be made available and accessible at every scale.
What technologies are pivotal to the energy transition?
Lots! And doubtless also technologies that are yet to be envisaged and developed. One important being the storage of energy. Given the nature of the future energy market, dominated by renewable energy, we need to facilitate the required flexibility of the market. When we have exhausted other options like demand response and cross-border energy trade, we need to be able to store energy in order to ensure security of supply. Some technologies exist to store electricity, but we could really benefit from new storage solutions.
I am inclined to say that whomever invents and designs this will become the new Rockefeller. Due to the importance of energy storage, I welcome the newly published working document by the Commission concerning the very same as it serves as a foundation to discuss further possible policy approaches.
Of the technologies that are already in place, I would like to highlight the value of smart meters to keep track of the energy consumption of buildings. Energy is not sexy, and is frankly an odd size to relate to – or at least this is how I feel. Smart meters help in this way, as they empower the customers with information and with the ability to communicate with utility companies. In short, they give customers control. In addition to providing real-time data on the energy used, smart meters create incentive for the consumers – regular people – to pay attention to their energy consumption, as they will be compensated for the savings achieved through demand response actions. The EU aims to replace at least 80% of electricity meters with smart meters by 2020 wherever it is cost-effective to do so, and this is a good thing.
How can trade enhance the transformation of the energy system?
Essentially, the more integrated the EU energy market is, the more cost-effective, secure, and affordable the electricity will become to energy consumers. Striving for the benefits of free trade automatically creates incentive to transform the energy system towards common energy market rules and the creation of cross-border infrastructure.
This is my approach to the revision of the proposal on the Agency for the Cooperation of Energy Regulators. I want the agency to be able to provide a proportionate and effective regulatory framework, that promotes competition and avoids over-regulation and overly-prescriptive measures which could stifle markets and overwhelm consumers.