European Energy Transition Research Articles

The role of natural gas in setting electricity prices in Europe

The EU energy and climate policy revolves around enhancing energy security and affordability, while reducing the environmental impacts of energy use. The European energy transition has been at the centre of debate following the post-pandemic surge in power prices in 2021 and the energy crisis following the 2022 Russia-Ukraine war. Understanding the extent to which electricity prices depend on fossil fuel prices (specifically natural gas) is key to guiding the future of energy policy in Europe. To this end, we quantify the role of fossil-fuelled vs. low-carbon electricity generation in setting wholesale electricity prices in each EU-27 country plus Great Britain (GB) and Norway during 2015-2021. We apply econometric analysis and use sub/hourly power system data to estimate the marginal share of each electricity generation type. The results show that fossil fuel-based power plants set electricity prices in Europe at approximately 58% of the time (natural gas 39%) while generating only 34% of electricity (natural gas 18%) a year. The energy transition has made natural gas the main electricity price setter in Europe, with gas determining electricity prices for more than 80% of the hours in 2021 in several countries such as Belgium, GB, Greece, Italy, and the Netherlands. Hence, Europe’s electricity markets are highly exposed to the geopolitical risk of gas supply and natural gas price volatility, and the economic risk of currency exchange.

The impact of methane leakage on the role of natural gas in the European energy transition

Decarbonising energy systems is a prevalent topic in the current literature on climate change mitigation, but the additional climate burden caused by methane emissions along the natural gas value chain is rarely discussed at the system level. Considering a two-basket greenhouse gas neutrality objective (both CO2 and methane), we model cost-optimal European energy transition pathways towards 2050. Our analysis shows that adoption of best available methane abatement technologies can entail an 80% reduction in methane leakage, limiting the additional environmental burden to 8% of direct CO2 emissions (vs. 35% today). We show that, while renewable energy sources are key drivers of climate neutrality, the role of natural gas strongly depends on actions to abate both associated CO2 and methane emissions. Moreover, clean hydrogen (produced mainly from renewables) can replace natural gas in a substantial proportion of its end-uses, satisfying nearly a quarter of final energy demand in a climate-neutral Europe.

People have the power. Electricity production, renewable energy transition, and communities empowerment across 11 Nordic-Baltic countries.

Stakeholders and communities' involvement is vital for shaping novel intergenerational resource governance frameworks. This is crucial for modelling upcoming energy transitions towards cleaner and more sustainable production systems. New models envisage energy mixes in which renewable resources are prominent and offer sustainable development advantages. Examining electricity production figures is, hence, necessary to understand trends and formulate policies and actions. This paper aims at drafting the state-of-the-art of electricity production in the Nordic-Baltic Sea area, moving an exploratory regional appraisal. Aggregated and disaggregated data on electricity production sources are explored and compared for all the eleven selected countries-at domestic, sub-regional, and regional levels. The region shows great national diversity, which implies diversified energy policies. Thus, the role of local initiatives-such as power grid implementation-in local communities empowerment is revealed. From this outcome, possible strategies are prescribed locally to assist the regional sustainable energy appraisal and furnish indications for the European energy and ecological transition.

Beyond sector coupling: Utilizing energy grids in sector coupling to improve the European energy transition

Sector coupling and system integration are key concepts in the energy transition from fossil fuels to fully decarbonized energy systems based on renewable energy. An intelligent use of sector coupling – such as that expressed in the concept of a smart energy system –accommodates for the identification of a more energy-efficient and affordable green transition. However, these benefits are often not fully identified in scenario modelling for the simple reason that not all energy systems analysis tools are equipped to do so. Here, we use the EnergyPLAN tool to replicate the EU Baseline and 1.5 TECH scenarios of the report “A Clean Planet for All”, which we then compare to a smart energy systems scenario for Europe. Due to its focus on sector coupling, we show how such a smart energy Europe scenario can be more energy efficient and affordable than the other scenarios.

Thermal energy communities: what, why and how to formulate complex collective action for the thermal energy transition in Europe

Abstract Thermal energy communities are community-based initiatives for heating and cooling purposes, where thermal energy is generated and consumed collectively based on renewable thermal energy sources for all participants. This article answers why and how to establish such collective energy systems in Europe, considering their unique characteristics and energy security requirements.

Influence of bioenergy and transmission expansion on electrical energy storage requirements in a gradually decarbonized European power system

With the ongoing energy transition in Europe, the share of variable renewable energies (VRE) in the power system increases steadily and different flexibility options gain importance. This work investigates the deployment of supply side flexibility options in the future European power system by energy system modelling focusing on classic power storage technologies, hydrogen storage, generation by biomass and grid expansion. While investigating different flexibility availability scenarios, for the first time the competition of long-term flexibility options is investigated across a broad decarbonization spectrum. In all scenarios, an increasing need for additional flexibility options is found for moderate decarbonization levels with VRE shares higher than 50%. From there on, the deployment of power storages grows nonlinearly, and eventually features a remarkable leap when approaching a zero-emission system, which is mainly driven by hydrogen storage investments. This also comes along with a leap in the total system costs. When the expansion of biomass capacities is available, biomass partly takes over the function of hydrogen as a long-term flexibility option. When enabling grid expansion, additional transmission capacities lead to a stronger integration of wind generation, while (especially short-term) storage requirements for higher decarbonization levels decrease. Both the additional investments into biomass generation and transmission grid result in up to 4% lower total system costs, yet, without completely displacing any other flexibility option. We conclude that the interaction of multiply flexibility options will lead to a cost minimal power system.

Analysis of the possible contribution of different nuclear fusion technologies to the global energy transition

Despite the huge uncertainties related to the possibility of a quick development of nuclear fusion technologies - being disputed that it may come too late to effectively contribute to emission mitigation - research is focusing on a wide set of options for fusion reactors. This paper presents a global scenario analysis using the energy system optimization model EUROfusion TIMES to analyze the possible future role of fusion according to three different technologies and using capacity curves based on historical trends for the electricity sector. The analyzed fusion options are based on ARC, EU-DEMO and Asian-DEMO reactor concepts, characterized in terms of techno-economic features according to publicly available literature and considering a set of educated growth rate for their penetration. Results concerning installed capacity trends and contribution to the electricity mix are presented up to 2100 in three socio-economic storylines and for different scenarios considering either the availability of competing technologies or delays in the development of fusion plants. Despite not contributing at all to the energy transition in Europe and the US, fusion may gain share in contexts characterized by highly growing electricity demand, contributing to satisfy stringent environmental constraints together with other low-carbon technologies in the second half of the century.

Energy communities for companies: Executives’ preferences for local and renewable energy procurement

Energy communities are a cornerstone of the European energy transition. Small and medium enterprises (SMEs) exhibit a particularly high potential for energy communities due to their energy demand and flexibility volume. However, in contrast to residential consumers, empirical evidence on SMEs' preferences for participating in renewable energy communities is scarce. This study investigates European SMEs' preferences for local and renewable energy procurement in four countries with a choice experiment. Our sample includes decisions by 823 executives for different energy procurement offers with an energy community approach. In the study, in 67% of the choices, SMEs prefer a renewable energy community offer to their current supply option even without a price premium. Cost is the most important factor in SMEs' energy supply decisions. SMEs have marked preferences for local providers, low administration efforts and high interest in demand-side management and peer-to-peer trading. In contrast, SMEs might reject energy procurement models when major time investments are required, or the provider is an international company. Offers that include local companies or electricity providers and provide smart energy management are most likely to win SMEs' consent. The study recommends orienting the business model design of energy communities towards the specific preferences of corporate consumers to leverage their potential. The results suggest that electricity providers are well-accepted players by SMEs as potential providers of energy community solutions. National implementations of the European policy directive are recommended to take into account the role electricity providers can play in the development and operation of energy communities.

White knight or partner of choice? The Ukraine war and the role of the Middle East in the energy security of Europe

The Ukraine war has forced Europe to redefine its energy security policies towards more diversification and less reliance on Russian energy. As an energy-rich and relatively close region, the Middle East can play a potentially important role in Europe's future energy security. However, a short-term and static view on the Middle East's readiness as Europe's energy partner conceals the dynamic nature of Europe's external policy towards this region. Closer energy cooperation with the Middle East requires a holistic approach and informed strategies that consider the realities and perspectives of energy-exporting countries. This paper provides an analysis of the role of the Middle East in Europe's energy security by considering political economic factors such as capacity, domestic reforms, and long-term supply reliability. Using a perspective based on international political economy, long-term strategies for energy cooperation between the Middle East and Europe are highlighted. Integration with North Africa's energy markets and infrastructure can deliver energy supplies and foster energy transition in Europe and the Middle East. Oil diplomacy with Gulf countries is necessary for price stability and the compensation of oil supplies for Europe. Finally, there are opportunities for European countries to strengthen energy trade partnerships (particularly with Qatar) and thus become more involved in the interstate competition for the abundant gas supplies of the Middle East. Europe's energy rapprochement with the Middle East solicits a re-examination of EU external energy policies in order to achieve more long-term and mutually beneficial energy cooperation.

Shifts in the smart research agenda? 100 priority questions to accelerate sustainable energy futures

Energy transitions are at the top of global agendas in response to the growing challenges of climate change and international conflict, with the EU positioning itself as playing a pivotal role in addressing climate risks and sustainability imperatives. European energy transition policies identify ‘smart consumption’ as a key element of these efforts, which have previously been explored from a predominantly technical perspective thus often failing to identify or address fundamental interlinkages with social systems and consequences. This paper aims to contribute to interdisciplinary energy research by analysing a forward looking ‘Horizon Scan’ research agenda for smart consumption, driven by the Social Sciences and Humanities (SSH). Reflecting on an extensive systematic Delphi Method exercise surveying over 70 SSH scholars from various institutional settings across Europe, we highlight what SSH scholars see as future directions for smart consumption research. Building from seven thematic areas (under which are grouped 100 SSH research questions), the study identifies three key ‘shifts’ this new smart research agenda represents, when compared to previous agendas: (1) From technological inevitability to political choice, highlighting the need for a wider political critique, with the potential to open up discussions of the instrumentalisation of smart research; (2) From narrow representation to diverse inclusion, moving beyond the shortcomings of current discourses for engaging marginalised communities; and (3) From individual consumers to interconnected citizens, reframing smart consumption to offer a broader model of social change and governance. Social Sciences and Humanities scholarship is essential to address these shifts in meaningful (rather than tokenistic) ways. This agenda and the shifts it embodies represent key tools to enable better interdisciplinary working between SSH and teams from the technical and natural sciences.

An Overview of Issues and Options for Technology Innovation and Climate Change Policy

Climate change is a prominent global environmental challenge that is predicted to have a significant impact in the future. Addressing this issue requires substantial reductions in greenhouse gas emissions, which, in turn, necessitated major technological changes in the energy and related sectors. Those changes are crucial to achieving emissions reductions at an acceptable social cost. Fortunately, there is some consensus at the international level regarding the need for action and solutions to combat climate change. Both at the domestic and international levels, implementing policies that promote the necessary technological innovations for climate change mitigation presents institutional challenges. Developing and successfully implementing such policies requires navigating various perspectives on understanding the economics of technological innovation. To move forward and make progress in mitigating climate change, it is essential to explore viable pathways. Technological advancements offer promising solutions for combating climate change. Leveraging technology can enable countries and companies to meet their emission reduction targets effectively. Emphasizing sustainable behaviors and household actions can play a crucial role in rapidly reducing carbon emissions. Moreover, the energy transition in Europe highlights the systematic approach needed to address the challenges of decarbonization. The Intergovernmental Panel on Climate Change (IPCC) has emphasized the urgency of limiting global warming to 1.5 degrees Celsius, underscoring the need for transformative actions and innovation. A comprehensive understating of barriers, emotions, and motivational levers can inform effective pathways for lifestyle transformations and household decarbonization. While technological innovation is pivotal, it should be complemented by policy interventions that target household consumption and behavioral decisions to achieve low-carbon futures. Behavioral change, combined with technological advancements, can provide a sustainable pathway toward reducing carbon footprints and mitigating climate change The paper attempts to explain the various points of view on understanding the economics of technological innovations and a way forward on what appears to be possible for climate change mitigation.

Does time matter? A multi-level assessment of delayed energy transitions and hydrogen pathways in Norway

The Russian invasion of Ukraine has undeniably disrupted the EU's energy system and created a window of opportunity for an acceleration of the low-carbon energy transition in Europe. As the trading bloc's biggest gas supplier, Norway faces the imminent threat of fast-depleting gas reserves and declining value for its exports. Norway is trying to beat the clock by aggressively exploring more petroleum, therefore delaying its energy transition. In anticipation of the future drop in gas prices, Norway is counting on blue hydrogen to valorise its gas resources, before gradually shifting to green hydrogen export. Against this background, this article seeks to understand how changes in the EU's energy landscape have affected the energy export sector and low-carbon hydrogen export developments in Norway from a multi-level perspective. Using the exploratory scenario approach, the article assesses the implications of the different petroleum exploration outcomes on the development of the low-carbon hydrogen export market in Norway. The findings show that despite gas discoveries, there is an urgent need for a phase-out plan for the Norwegian petroleum sector. For low-carbon hydrogen to play an important role in Norway's energy transition, time is of the essence and action needs to be taken during this window of opportunity. An industrial sector and its value chain could take 25 years to transform, which means that actions and policies for a full transformation pathway need to take place in Norway by 2025 to be ready for a climate-neutral Europe in 2050.

Statistical evidence for the contribution of citizen-led initiatives and projects to the energy transition in Europe

Statistical accounting of the impacts of citizen-led energy initiatives is absent, despite their impact on increased energy self-sufficiency and ramping up of renewable energies, local sustainable development, greater citizen engagement, diversification of activities, social innovation, and acceptance of transition measures. This paper quantifies the aggregate contributions of collective action in pursuit of the sustainable energy transition in Europe. We estimate the number of initiatives (10,540), projects (22,830), people involved (2,010,600), installed renewable capacities (7.2–9.9 GW), and investments made (6.2–11.3 billion EUR) for 30 European countries. Our aggregate estimates do not suggest that collective action will replace commercial enterprises and governmental action in the short or medium term without fundamental alterations to policy and market structures. However, we find strong evidence for the historical, emerging, and actual importance of citizen-led collective action to the European energy transition. Collective action in the energy transition is experimenting successfully with new business models in the energy sector. Continued decentralization of energy systems and more stringent decarbonization policies will increase the importance of these actors in the future.

As essential as bread: Fuelwood use as a cultural practice to cope with energy poverty in Europe

Fuelwood has been overlooked by European energy transition policies, despite its importance as a domestic energy source for many European households. We study fuelwood use for coping with energy poverty based on the lived experience of energy-vulnerable households in five diverse European countries (Portugal, Slovakia, Hungary, Austria, and North Macedonia). From their perspective, fuelwood is a central and multifunctional tool for coping with energy poverty because of its many favorable features, including enabling energy security and access, that overweigh its adverse environmental and health impacts. We argue that the use of fuelwood for coping with energy poverty is embedded in cultural practices building upon the interconnection of three stages of coping behavior. The first stage is fuelwood becoming a socio-cultural norm, which means it is considered a cultural practice for coping with energy poverty due to its many benefits that protect the energy vulnerable from increasing energy prices, disconnections, and further energy deprivation. This enhances the subsequent phase, featuring the normalization of subsistence which is the acceptance of life with minimal energy needs. This leads to the final stage with increasing system detachment which is continued reliance on individual and informal arrangements of satisfying energy needs and avoiding seeking or demanding institutional support.

A typology of business models for energy communities: Current and emerging design options

In the European energy transition, energy communities have gained an increasing amount of attention. To support widespread diffusion, academic and practice-oriented studies have called for a business model perspective on energy communities. This study presents a morphological analysis of 90 energy communities and pioneering companies that apply business model design options that can be adopted in energy communities. The sample was selected based on implementation examples focusing on community solutions, a multivector energy approach, or a combination of both. Based on this analysis, we have identified 25 emerging business model design options for energy communities. The presented typology allows users to configure tailor-made business models for energy communities, hence supporting community facilitators in the development process. The presented frequency analysis of the design options shows the potential for the further development of energy communities. The typology contributes to the literature on energy communities by offering one of the first studies to adopt a business model perspective. Through a morphological approach, the typology can be used as a tool for developers of energy communities, offering a robust set of business model design options.

Hydrogen in the Integrated Energy System of the Future - A Case Study for the European Energy Transition

Hydrogen in the Integrated Energy System of the Future - A Case Study for the European Energy Transition

Evidence behind the narrative: Critically reviewing the social impact of energy communities in Europe

Energy Communities are playing an ever greater role in the European renewable energy transition. As an instrument for citizen-led transformation, they are associated not only with economic and environmental, but also with social benefits. However, it is unclear whether Energy Communities in Europe deliver on the positive social impact they promise. In this paper, we analyze the conceptual background of the social impact associated with Energy Communities and clarify the underlying constructs of community empowerment, social capital, energy democracy and energy justice. We conduct a systematic literature review and develop an overview of studies which measured social impact. Through classifying evidence along methods and constructs measured in an evidence gap map, we demonstrate where rigorous evidence is missing: from quantitative and experimental studies, and longitudinal and counterfactual designs, which should guide future research. We conclude with recommendations for both research and policy to promote the collection of robust evidence on the social impact of Energy Communities in Europe.

Eliciting knowledge from stakeholders to identify critical issues of the transition to climate neutrality in Greece, the Nordic Region, and the European Union

There are considerable differences in the pace and underlying motivations of the energy transition in the different geographical contexts across Europe. The European Union's commitment to climate neutrality by 2050 requires a better understanding of the energy transition in different contexts and scales to improve cooperation of involved actors. In this article, we identify critical issues and challenges of the European energy transition as perceived by stakeholders and investigate how these perceptions vary across geographical contexts. To do so, we couple a policy document analysis with research based on stakeholder engagement activities in three different scales, national (Greece), regional (Nordic Region) and continental scale (European Union). Our findings show that stakeholder perspectives on the energy transition depend on contextual factors underlying the need for policies sensitive to the different transition issues and challenges in European regions. They also reveal cross-cutting issues and challenges among the three case studies, which could lead to further improvement of the cross-country collaboration to foster the European energy transition.

Review of Energy and Climate Plans of Baltic States: The Contribution of Renewables for Energy Production in Households

The European Commission introduced a package of measures to accelerate the shift to low-carbon energy transition in Europe. In 2014, EU member states agreed to reduce greenhouse gas emissions by at least 40% by 2030 compared to 1990 levels. The binding greenhouse gas emission targets for Member States from 2021 to 2030 for the transport, buildings, agriculture, waste, and land-use and forestry sectors were established. EU Member States should decide on their own how to meet the agreed upon 2030 target and implement climate-change-mitigation measures. All EU MSs have committed to prepare national energy and climate plans based on regulation on the governance of the energy union and climate action (EU)2018/1999, agreed as part of the Clean Energy for All Europeans package approved in 2019. The national plans outline how the EU Member States intend to implement the GHG reduction target by increasing their in energy efficiency, use of renewables, greenhouse-gas-emission reductions, interconnections, and research and innovation. This paper analyzes the energy and climate plans of the Baltic States and systematizes the main climate-change-mitigation policies in the energy sector targeting the household sector. The background of energy and climate planning is provided from a theoretical point of view, encompassing regional, local, and national energy and climate plans. The diffusion levels of renewables in the Baltic States were determined and the energy-climatic-friendly policies followed, by them, they were identified.

Capture or Empowerment: Governing Citizens and the Environment in the European Renewable Energy Transition

The European renewable energy transition is a leading model for responding to the urgent threat of climate change, which it does by empowering citizens. Drawing on Foucault’s analysis of German neoliberalism, this article argues that despite some measure of empowerment, the economic constraints structuring the transition ultimately disempower citizens, undermining the attainment of environmental goals. Specifically, the transition gives citizens control of their energy while burdening them with entrepreneurial tasks to do so, substitutes economic activity for political citizenship, and shifts the epistemological terrain they take for granted when determining what environmental crises society faces and how best to respond. Understanding the transition as composed of theories for sustainability governance, policies, and practices of implementation, this article analyzes the “energetic society” governance theory, the Clean Energy for all Europeans Package, and the renewable energy organization REScoop.eu.