Hydrogen for Europe study - Available Manuel Villavicencio Economic Advisory - Deloitte France - ENTSOG
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Hydrogen for Europe study
Available at: https://www.hydrogen4eu.com
Dr. Manuel Villavicencio
Economic Advisory – Deloitte France
© 2021 Deloitte Finance
Reaching net-zero emissions in the EU by 2050 is a formidable challenge
The European Union has reduced its carbon emissions during the last decade
but the path towards net-zero requires a step change in efforts Integrated energy system for the Net-Zero target
7000
Total GHG emissions (MTCO2e)
7000
6000 6000
"2020 Package" 2009
5000 5000
"2030 Climate and Energy
Framework" 2014 (at least -40%)
4000 4000
3000 3000
"EU Green Deal" 2020 (with
at least -55% in 2030)
2000 2000
1000 1000
Net-zero
0
-1000 -1000
Other (indirect CO2) LULUCF
International shipping International aviation
Waste Agriculture
Residential/commercial Transport
Industry Energy supply
EU-27 historic emissions "EU Green Deal" 2020 (with at least -55% in 2030)
"2030 Climate and Energy Framework" 2014 (at least -40%)
© 2021 Deloitte Finance 2
The design of the Hydrogen for Europe study in a nutshell
Two main pathways are
Detailed energy system model
[MIRET-EU] analysed:
Hydrogen for Europe is a Linear programming
new research study that Technology
comprehensively looks at the Diversification pathway
European energy system to → Illustrates how an
assess the role of hydrogen inclusive approach
in the energy transition. helps minimize the cost
Import model
[HyPE] of the transition
Addressed issues Linear programming
Renewable Push
• How can renewable and pathway
low-carbon hydrogen → Shows the implications
contribute to the energy of a deliberate focus on
transition? renewables
• What decisions and Learning optimization model
[Integrate Europe]
pathways help to bring Dynamic programming Both are aligned with
down the technology
cost? key EU policy goals:
The study rests on a quantitative analysis, relying on three models • 55% reduction in GHG
• What is needed at policy and their interaction: MIRET, Integrate Europe and HyPE. by 2030,
and regulatory level ?
• Net-zero by 2050
Led by Deloitte, research centers SINTEF and IFPEN implemented an
innovative and original modelling approach
© 2021 Deloitte Finance 3
The primary energy mix is fundamentally reshaped in the two pathways
Evolution of primary energy demand in Europe
1 600 60% • x3.5 in 30 years
Primary energy demand (Mtoe)
Share in primary energy supply
1 400 • Meets almost half of
50%
48%
49%
primary energy by 2050
1 200
40%
40%
1 000
36%
29%
29% 32% • 32% share by 2050
800 30%
28% • Resilient during the
25%
600
20% transition
400 14%
10%
200 8%
• Dwindling role of coal and
3%
- 0% oil
2016 2030 2040 2050
• 3% share by 2050
Historic Technology Diversification pathway
Coal Oil Natural gas
Nuclear Ambient heat Wind
Solar Other renewables Hydrogen from non-Eu. countries
Share of renewable energy Share of natural gas Combined share of oil and coal
© 2021 Deloitte Finance 4Electricity and hydrogen combine forces to decarbonise energy end-use
Evolution of gross final energy consumption by energy carrier by 2050
1 200
Final energy consumption in Mtoe
1 000 -10% Energy efficiency
800
21% Hydrogen
600
400
43% Electricity
200
0 3% Natural gas
2016 2030 2040 2050
Historic Technology Diversification pathway E-fuels
3%
Oil e-fuels (e-liquid) Natural gas Coal Bioenergy
Electricity Heat distributed Ambient heat Hydrogen Other Renewables
© 2021 Deloitte Finance 5Hydrogen key for decarbonizing hard-to-abate sectors
Hydrogen demand by sector
Industry: 4455MtH
Transport: 2 2inin2050
MtH 2050
~ 100 million tonnes
60% of the maritime demand
18 MtH2 in iron & steel
43% ~100 MtH2 of H2 consumed 30%
byof the aviation demand as e-fuel
consumed in
55% 2050
2050 6 MtH in chemicals as energy (excludes
2
feedstock)
15 million trucks and buses run on hydrogen
Transport Industry Buildings Power
© 2021 Deloitte Finance 6Diversity and complementarity between hydrogen supply options
Technology Diversification pathway
Supply in MtH2
Renewable
Imports Low-carbon hydrogen
hydrogen
from non-European countries
Renewable and capacities
Additional electrolyzers
perinstalled capacities
decade in by 2050
Technology
2050 37 5 43 2 15 101 MtH2 Diversification pathway
2040 19 3 49 5 10
+155 GW
+80 GW
2030 2 28 3 +16 GW
1 000 – 1 700 GW
Renewable Push pathway
Supply in MtH2
2050 77 20 10 108 MtH2 +2 GW
+8 GW
700 – 1 250 GW 370 – 380 GW
+11 GW
2040 40 33 8
2025 - 2034 2035 - 2044 2045 - 2054
2030 10 21
Reformer with CCS Methane pyrolysis
Electrolyzer Biomass / biomass with CCS Imports from non-European countries 680 – 1 500 GW
Reformer with CCS Methane pyrolysis
© 2021 Deloitte Finance 7Zooming in on CO2 emissions and the net-zero objective
CO2 emissions breakdown by sector: net-zero by 2050
4 000
Carbon capture and storage technology is indispensable:
CO2 emission in MtCO2
- Unlock the potential of low-carbon solutions
3 000 -55%
- Enabling negative emissions
2 000 Net
zero
1 000
6%
9% 7%
0 32%
18% 13%
44%
40% 48%
-1 000
43%
2016 2030 2040 2050 26% 14%
Power Sector Transport Sector
9% 8%
Building sector Other energy transformation processes 3%
Industry sector Agricultural sector
Other carbon dioxide removal Net emissions
97% 91% 92%
Some 400 Mt of CO2 are removed in 2050
In some applications the cost of full decarbonization is grater 2030 2040 2050
than compensating emissions with CO2 removal. CO2 captured CO2 stored/used
Hydrogen production Biorefineries CCU
Power sector Direct Air Capture Underground storage
Industry sector
© 2021 Deloitte Finance 8Investment, investment, investment…
Investment pathways in the hydrogen value chain
(including offgrid electricity) Trillions of euros are needed in both scenarios
3 500 to finance the hydrogen value chain.
Temporality and level of necessary investment
3 000
differ between the scenarios: more money
needs to be mobilized earlier in the Renewable
2 500
Push pathway
€ billion
2 000
1 500 5.5 trillion euros
Renewable Push
1 000
500
€
3.1 trillion euros
-
2021-2034 2035-2044 2045-2054
Technology Diversification
€
Technology Diversification pathway Renewable Push pathway
© 2021 Deloitte Finance 9Key insights from the modelling for energy policy-making
The Technology Diversification pathway offers to European Five main guidelines to inform the design of next policy
society several advantages that policy-makers should trade- packages and measures
off against other criteria
Internalising CO2 emissions and changing the
De-risking achievement economics in favour of clean technologies
of the energy transition
Accounting for CO2 content of energy use
Achieving the net- Fostering innovation and R&D and bringing new
Relieving the financing
zero emissions goal technologies to commercial viability
bottleneck
at a lower cost
Enabling low-cost financing and bankability of
investments in low-carbon and renewable solutions
A more competitive and
Ensure system integration and coordinate supply
efficient energy system and demand uptake
© 2021 Deloitte Finance 10Thanks for your attention
Dr. Manuel Villavicencio
mvillavicencio@deloitte.fr
© 2021 Deloitte Finance 11You can also read
