At a time when the European Commission is positioning electrification as a central pillar of the rising Clean Industrial Deal, power specialists and policymakers warn that Europe shouldn’t be but on the trajectory wanted to ship.
Despite political momentum, Europe’s electrification fee has been caught at 23% of complete power consumption for a decade. Even extra placing is the drop in electrical energy demand – down 7.5% between 2021 and 2023, earlier than a modest 1% rebound final yr.
Historically, the facility wants of business customers have been handled as an issue to be solved – one thing that pulls power out of the grid and contributes to local weather change. But what if industrial demand might really be seen as a strategic asset that may stabilise the grid?
Predictable baseload
At a current Euractiv occasion, specialists underlined that enormous industrial customers are uniquely positioned to help the electrical energy system – in the event that they obtain the suitable incentives.
Predictable baseload demand may help grid operators plan infrastructure wants extra precisely, avoiding costly overbuilds. For instance, long-term consumption commitments from energy-intensive sectors resembling aluminium, metal and cement might present the soundness wanted to construct future grids extra effectively.
Industries that may function flexibly, shifting manufacturing to intervals of low demand or excessive renewable era, might considerably scale back curtailment. Policymakers are beginning to look increasingly more at this concept.
At the occasion, Fabien Roques from the consultancy Compass Lexicon offered a brand new research which is considering the grid in several methods. “For a great a part of my profession I’ve been wanting on the energy system from the era to the transmission distribution after which to the top consumer, and for the primary time with this research, I really checked out it from the opposite means round – ranging from the top client and attempting to grasp what they will carry to the facility system,” he stated.
Geographical focus
The research concludes that the predictability and geographic focus of business demand is a chance to optimise the facility system.
“If you’re operating an environment friendly industrial facility in your energy market, you’ll have a really predictable load – and that’s very related by way of how you use that system and the way you propose,” he stated. Industrial services can even offtake energy when demand from different sectors is low.
But harnessing industrial demand’s potential for the electrical energy system requires an sufficient market and regulatory framework. Europe is concurrently pushing for large deployment of renewable power whereas struggling to generate enough energy demand to justify these investments.
Weak funding surroundings
The result’s acquainted however more and more destabilising: renewable curtailments, unfavourable worth episodes, and a weakening funding surroundings for brand new era capability.
“We know business is consuming about 25% of our power, however solely a 3rd of that’s electrical energy and we predict there’s main potential inside business to affect – for example low and medium temperature heating processes may very well be simply electrified with in the present day’s expertise,” stated Tom Howes, an advisor for the inexperienced transition and market regulation on the European Commission.
“We’re partly addressing that by way of the inexpensive power motion plan, and we’re additionally grid tariffs, connection regimes, the best way the markets perform, the best way tax regimes work – we’re reviewing all of those to make all of those completely different levers incentives for larger introduction of demand and larger load, and suppleness is a part of that as properly.”
However, the flexibleness potential varies broadly by sector. Aluminium smelters, for instance, have some room to modulate hundreds, however cement manufacturing provides far much less operational leeway. Ensuring that flexibility stays “technically possible and economically engaging” was a constant theme.
Transforming grids
Nick Keramidas, common supervisor for EU affairs on the Greek power and metals firm Metlen, which commissioned the research, stated current developments are remodeling grids.
“There’s a quickly rising downside each in Greece and different European nations of renewables curtailments, the decline of renewables PPAs, and rising zero and unfavourable costs within the wholesale markets,” he stated. “At the identical time, we’ve been seeing a dialogue round Brussels about industrial demand flexibility, which was type of superficial. So we thought there was advantage in deep diving into that.”
“The fact is, pushed by an absolute deal with emissions reductions over the previous few years and barely disregarding reliability and affordability, we ended up forgetting customers,” he added. “The query that the research ended up responding to was… are power-intensive sectors good or unhealthy for the facility system?”
The panel additionally confronted a central pressure: whereas Europe needs business to play a extra lively position in balancing the electrical energy system, the continent is already grappling with structurally increased industrial energy costs than international rivals.
Any new obligations or expectations should due to this fact be paired with sturdy safeguards for competitiveness, panellists stated.
Industry representatives reiterated that electrification investments, whether or not for warmth pumps, electrical furnaces, or hydrogen manufacturing, are capital-intensive and rely closely on worth indicators and regulatory certainty. Without clear, long-term incentives, many corporations will merely delay or offshore initiatives.
Panellists agreed that Europe’s power transition requires a coherent demand-side technique -something nonetheless lacking from the present coverage panorama. With the Clean Industrial Deal advancing, power stakeholders are urging policymakers to position industrial demand alongside renewables, grids and storage as a strategic asset in its personal proper.
(BM)
