For over a year, one expression \u2013 \u201csector coupling\u201d \u2013 has been on everybody\u2019s lips among EU energy policy observers in Brussels. The only problem is none of them share the same understanding of what it actually means.<\/p>\n
For people in the power sector, sector coupling means electrifying transport, heating and just about every sector of the economy which hasn\u2019t yet been electrified.<\/p>\n
For the gas industry, it means the opposite: delivering low-carbon gases in sectors which cannot easily be electrified \u2013 and building connections between the two in the form of power-to-gas and storage facilities.<\/p>\n
For people in transport, it means all of the above. And for those in the building sector, it means deploying district heat networks across cities, and bringing electric heat pumps, solar panels, batteries and smart control systems to every household.<\/p>\n
And the list goes on, with other sectors like agriculture, water, waste and recycling joining the party.<\/p>\n
\u201cThe buzzword sector coupling goes by many definitions,\u201d admits Augustijn van Haasteren, an official at the European Commission\u2019s energy department who supervises a special unit dealing with the matter. \u201cOne way of looking at it is energy system optimisation,\u201d he said during a EURACTIV event last month.<\/p>\n
All agree on one objective, though: sector coupling should result in lower energy consumption, reduce network investment costs, and allow greater amounts of renewables in the energy mix. All of which with one ultimate goal \u2013 cutting emissions of global warming gases down to net-zero.<\/p>\n
According to Lisa Fischer from climate think-tank E3G, \u201cthe Commission has developed its own terminology where sector coupling is really about the interconnection between gas and electricity \u2013 meaning power-to-gas and gas-to-power. And sector integration is looking at energy, transport, and heating networks together.\u201d<\/p>\n
But even that definition wouldn\u2019t be entirely accurate because it fails to bring energy-consuming sectors explicitly into the mix, critics say. For them, sector coupling can be boiled down to energy efficiency: in the building stock, but also in industrial processes and in the wider energy system.<\/p>\n
\u201cSector coupling is an enabler of that\u201d because it allows using by-products of industry, such as wasted heat, said Julie Kjestrup from Danish engineering firm Danfoss, which supported the EURACTIV event.<\/p>\n
\u201cIf we manage this correctly \u2013 and I agree it\u2019s difficult \u2013 then we can couple the energy-using sectors with the energy-consuming sectors\u201d including buildings, heating and cooling, transport, water and industry, she told participants at the EURACTIV event. \u201cAnd if we do that, we will manage to reduce the overall energy consumption. We will manage to store energy and we will create synergies that offer the flexibility to roll-out renewables faster.\u201d<\/p>\n
Supply-driven approach is \u201cthe enemy\u201d<\/p>\n
For the most radical among EU energy policy specialists, sector coupling actually means fundamentally rethinking energy supply and demand.<\/p>\n
\u201cThe first priority is to definitely get away from the supply-driven\u201d and centralised approach to generating energy, said Claire Roumet from Energy Cities, an association bringing together more than 1,000 towns and cities in the energy transition.<\/p>\n
\u201cIt was fine to do it before. Today, if we continue to do it, we will basically destroy our ability to reach any kind of climate goal,\u201d she warned. \u201cSo for me, this is really the enemy,\u201d Roumet stressed. \u201cWe need to go into something which is much more decentralised, sector-coupling, and demand-oriented,\u201d she said at the EURACTIV event.<\/p>\n
This is summarised in a study for the European Parliament\u2019s industry committee, which says sector coupling is about \u201cthe increased integration of energy end-use and supply sectors with one another\u201d.<\/p>\n
Few certainties<\/p>\n
Despite the all-embracing nature of that definition, there are also a number of certainties. The first is that low-carbon electricity is expected to become the dominant energy carrier in Europe, covering 53% of the bloc\u2019s energy needs by mid-century, according to Commission projections for 2050.<\/p>\n
\u201cWe all know that by 2050 renewable energies will become very important, particularly in the electricity sector,\u201d van Haasteren said, citing the Commission\u2019s long-term strategy for 2050. \u201cAnd we also know that this requires a flexible energy system,\u201d he added in reference to the variable nature of solar and wind power.<\/p>\n
There are obvious implications to this. First, as electricity gradually rises to dominate the energy landscape, gas will increasingly act as a back-up to electricity, with a growing number of power-to-gas facilities expected to store excess renewable electricity production in gaseous form.<\/p>\n
In fact, gas storage operators are increasingly positioning themselves on new markets \u2013 first as back-up for variable wind and solar power and, in the long run, as established providers of \u201cflexibility\u201d services in a future energy system where electricity and gas will be more closely integrated.<\/p>\n
Combining gas and electricity<\/p>\n
This is where gas and electricity industry lobbyists see eye-to-eye.<\/p>\n
\u201cThe\u00a0coupling\u00a0of the electricity and gas\u00a0sectors\u00a0can bring significant benefits,\u201d says Eurelectric, the power industry association. \u201cDirect electrification, using carbon neutral electricity, could be complemented by power-to-gas and non-emitting fuels and gases, in those \u2018hard-to-abate\u00a0sectors\u2019 such as industrial processes,\u201d it said in a statement.<\/p>\n
Such a hybrid energy system mixing gas and electricity is actually at the centre of the European Commission\u2019s 2050 scenarios.<\/p>\n
\u201cCombining the electricity and gas infrastructure \u2013 for us in the Commission it\u2019s clear that it\u2019s the way to go,\u201d said Klaus-Dieter Borchardt, deputy director general at the Commission\u2019s energy department. \u201cA hybrid system based on two pillars, in our view, is more resilient and would really add to security of supply,\u201d Borchardt said earlier this year, citing the cost savings this could bring to the wider energy system.<\/p>\n
Speaking at the October EURACTIV event, van Haasteren further expanded on this vision. While the interconnection between electricity and gas is already well researched, he said sector coupling was about finding sources of flexibility \u201cfrom other energy carriers\u201d.<\/p>\n
\u201cSo, we can speak about gas there. But another important vector, I think, is heating,\u201d van Haasteren pointed out.<\/p>\n
And here, some fundamental questions arise, he said. For instance, \u201cwhat is the interface between the different energy carriers? And is it actually possible to use the relative advantages of one energy carrier and infrastructure in the next one?\u201d<\/p>\n
Energy consumers at the centre<\/p>\n
The Commission doesn\u2019t start from nowhere in trying to answer these questions. Last year, it already laid the groundwork when it passed a reform of electricity market rules, which enshrined consumers\u2019 rights to generate their own electricity, and sell it back to the grid.<\/p>\n
And the same consumer-centric approach will apply when the Commission revises gas market rules in the coming years, the official suggested.<\/p>\n
\u201cWe\u2019re moving to a phase where decarbonisation really affects households directly,\u201d van Haasteren explained, suggesting smaller participants are better placed to make decisions on how and when to use energy.<\/p>\n
\u201cThe decisions to make this happen are more of a decentralised nature,\u201d van Haasteren pointed out. But \u201cto make this all coherent is a daunting task,\u201d he added, pointing to the experience gained with the recent reform of the EU electricity market, which put consumers at the centre.<\/p>\n
\u201cAnd that relates to price signals,\u201d he said referring to the energy taxation directive that is due to be reviewed under the next European Commission led by Ursula von der Leyen.<\/p>\n
Danish MEP Morten Petersen wouldn\u2019t disagree that this is a daunting task. \u201cAs legislators we tend to focus on the very specific directive at hand,\u201d without considering the broader picture, he said at the EURACTIV event.<\/p>\n
\u201cHaving this horizontal approach is bloody difficult, so I\u2019m open to all kind of good suggestions on how to improve this,\u201d he said.<\/p>\n","protected":false},"excerpt":{"rendered":"
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