Abstract
Climate and energy policies are tools used to steer the development of a sustainable economy supplied by equally sustainable energy systems. End-users should plan their investments accounting for future policies, such as incentives for system-oriented consumption, emission prices and hydrogen economy, to ensure long-term competitiveness. In this work, the utilization of variable renewable energy and flexibility potentials in a case study of an aggregate industry is investigated. An energy concept considering PV and battery expansion, flexible production, fuel cell electric trucks (FCEV) and hydrogen production is proposed, and analysed under expected techno-economic conditions and policies of 2030 using an energy system optimization model. Under this concept, total costs and emissions are reduced by 14% and 70%, respectively, compared to the business-as-usual system. The main benefit of PV investment is the lowered electricity procurement. Flexibility from schedulable manufacturing and hydrogen production increases not only the self-consumption of PV generation from 51% to 80% but also the optimal PV capacity by 41%. Despite the expected cost reduction and efficiency improvement, FCEV is still not competitive to diesel trucks due to higher investment and fuel prices, i.e., its adoption increases the costs by 8%. However, this is resolved when hydrogen can be produced from own surplus electricity generation. Our findings reveal synergistic effects between different potentials and the importance of enabling local business models, e.g., regional hydrogen production and storage services. The SWOT analysis of the proposed concept shows that the pursuit of sustainability via new technologies entails new opportunities and risks. Lastly, end-users and policymakers are advised to plan their investments and supports towards integration of multiple application, consumption sectors and infrastructure.
Highlights
Energy system decarbonization requires massive and rapid investments in both renewable energy (RE) and flexibility technologies [1]
Studies on optimal investments at a national level which consider a variety of potentials, e.g., [3,4,5], found that both RE and complementing flexibility investments are necessary for cost-effective and sustainable decarbonization efforts
Under low feed-in tariffs of variable renewable energy, investments may be intended for self-consumption
Summary
Energy system decarbonization requires massive and rapid investments in both renewable energy (RE) and flexibility technologies [1]. Essential emission reduction measures include utilization of biomass, wind and solar energy, electrifying heat generation and transport, and replacing fossil fuels with renewable hydrogen in selected applications [1]. Energy and climate policies can affect investment strategies of industrial end-users [16]. Under low feed-in tariffs of variable renewable energy, investments may be intended for self-consumption. To plan a cost-effective strategy towards carbon neutrality, end-users must consider prospective policies while exploiting their renewable energy and flexibility potentials. In Germany, PV feed-in tariffs have been strongly reduced in recent years [23]; and levelized costs of wind and solar generation can compete with costs of combined-cycle gas turbines in 2030 [24]
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