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International Cooperation in Energy and Energy Law: Sustainabilitys Toolkit

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International cooperation for innovationThis edition of NRG Magazine is dedicated to International Cooperation in Energy and Energy Law. The edition also has a particular focus on offshore energy and on the complexities and challenges that come from this area.

In my view, offshore energy is a sector in which international cooperation is essential, especially for the Netherlands. When thinking of offshore energy, wind energy immediately springs to mind, and this is mostly because of the challenges we face with respect to this particular form of renewable energy. The Netherlands needs offshore wind in order to achieve the European renewable energy objectives. However, at present the costs for wind energy are relatively high. In this sense, we want to focus on cost reduction before we will invest in offshore wind energy on a large scale. I firmly believe in innovating through demonstration projects. Innovation is key for reducing the costs of renewable energy and it provides us with an economic opportunity for our building industry at the same time.

Germany and the United Kingdom are realising offshore wind on a large scale. Denmark has become very experienced in this field due to its relatively long history with offshore wind. It is this kind of experience that is so precious to us, hence we can all benefit from international cooperation. If we combine our experience with foundations, maintenance and design of wind turbines with the know-how of other countries, we could make great progress. Wouldnt it be great to have a joint project in which all our knowledge and skills are combined, as a perfect example of the added value of international cooperation?

With respect to policy making we are and we will be focused on cooperation. In line with this, the International Energy Agencys work helps us evaluate our own policies, and enables us to learn from legislation in other countries. For example, in the field of granting permits or subsidies, we can explore what we can learn from Germanys financing mechanisms in order to improve our own. Also, from the Danes we can learn about how to approach issuing plots for offshore wind energy projects. There are many such examples of potential knowledge sharing. Thus, I believe that international cooperation is crucial in realising our international objectives. Bert de Vries

Bert de VriesDeputy Director-General for Energy, Telecommunication and Competition

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Dear Reader,

We need to know where problems are in order to solve them. At the same time, problems cannot be solved at the same level of awareness that created them (Albert Einstein). But how can we raise our level of awareness and get the right solutions if we do not find out: Who has the same problems? Who has tackled them? and where? Hence, how can we solve problems if we do not cooperate? This edition of NRG Magazine is dedicated to cooperation in energy. Since any good solution needs the help of regulation to be implemented, we decided that the role of law in reaching sustainability is important to be discussed. This means that our cover story, International Cooperation in Energy and Energy Law (pages 8-13) has five energy, law and security experts (Laura Cozzi, Pier Nabuurs, Prof. Martha Roggenkamp, Annika Sponselee and Marko van Zwam) discussing why cooperation between governments, businesses and fields is the key to enabling the implementation of sustainable solutions. Moreover, the lawyers from RenewabLAW, BASE Advocaten and Den Hollander Advocaten explain various issues encountered on the way to implementing sustainable projects or in the relationship between consumers and grid operators (page 14-17). We continue with one of the worlds most innovative smart grids projects and offshore solar energy concepts in the world, explained by Frits Verheij from DNV KEMA Energy & Sustainability (Pages 18-19).

This autumn, NRG Magazine is an official media partner for Gas Industry 2013, Energie Vakbeurs 2013 and Offshore Energy 2013. As a result, we decided to give our readers an information feast with an extensive offshore energy section (pages 20-25) and gas section (pages 28-33). You can read about the latest advancements and challenges in offshore energy and find out about the future of LNG from GDF SUEZ LNG Solutions and Shell Netherlands. After which, prepare to be challenged by our Rational Middle question where you will receive extensive help to understand the reasons behind the Chinese solar panel situation from Prof.Dr. Wim Sinke and from Honorary Professor Ton Schoot Uiterkamp (pages 25-37). We then give you a high dosage of NRG Facts or Fiction (pages 38-39) with its text written in Ecofont making this article the most ink-efficient one in the magazine. Energy and geopolitical expert Coby van der Linde is celebrated in the Back to the future section (pages 42-42), while discussing the global gas market situation and the geopolitical position of the Netherlands.

A revolution in heating systems that would make the Romans proud, since they were enjoying the first ones, can be found next in this edition. Warmtebedrijf Rotterdam is using waste heat from industrial processes to heat residential areas in the same city. Find out how in our Expert Section (pages 44-45). After which we extensively discuss talents, with a brief look at the TTA World event of the year, NRG Battle World-Edition at the World Energy Forum in Beijing, China (pages 46-47) to develop talents for market needs (page 48) and to four of our NRG Battle-Europe Edition top talents. In our last pages, Energy Academy Europe has a few surprises for you as well (pages 56-57).

Enjoy your reading.

Luminita Stoica

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INDEX8. Cover StoryInternational Cooperation in Energy and Energy Law: Sustainabilitys Toolkit

14. RenewabLAW The new concept supporting Dutch sustainability

18. Energy Efficiency with Frits VerheijSmart grids reloaded & offshore solar

20. NRG Magazine presents The Revolutionary Offshore

28. A Blue & Green Gas Revolution

30. LNG: Fuelling Sustainable Transport

32. Gas Backbone of the energy system

36. Rational MiddleAre increased taxes on imports of Chinese solar panels beneficial for the European solar market?

40. SIEnergyLab - Bridging Science & Business in ICT & Energy for a Sustainable Society

50.

NRG Facts or Fiction38. Fracking Future?

Hypocaust reinvented: Rotterdam is making use of its waste heat

44.

Cover story: International Cooperation in Energy and Energy Law

8 | NRG Magazine Edition 11

International Cooperation in Energy and Energy Law: We all share this planet. Hence we share the responsibility for keeping its systems functioning. Since climate change has already been negatively impacting our systems, our responsibilities as a species shift to fixing the planet, from its environmental problems to its energy issues all is interlinked. Fixing it is only the beginning. Keeping it fixed on the long term our biggest challenge. It requires innovation and common goals for us, the 7, soon to be 9 billion inhabitants of planet Earth. It requires international cooperation, healthy policies, the right kind of research and valid business cases. In line with this, NRG Magazine asked the help of five energy, law and security experts to understand why the global energy sector needs cooperation, but more importantly, why it is so hard to achieve.

No. 1 gas producer in the world: 22,902 bil. ft3

No. 1 consumer of electricity in the world: 3,724 bil. kWhNo. 2 carbon dioxide fcff emitter in the world: 5,637 mmt CO2-------------------------------------------------

Shale gas production*:7,994 bil. ft3

-------------------------------------------------

Natural gas imports from Canada: 2,962,849 mil. ft3 Natural gas imports from Mexico: 314 mil. ft3 LNG imports from: a. Egypt 2,811 mil. ft3 b. Norway 6,212 mil. ft3 c. Qatar 33,823 mil. ft3 d. Trinidad 112,207 mil. ft3 e. Yemen 19,595 mil. ft3

Renewables

Petroleum

Nuclear

Natural gas

Coal

12% 1% 19%30%27%

1% solar3% geothermal 4% biomass waste 8% biomass wood 28% wind56% hydropower

Electricity production:

US

1

1

2

3

4e

4d

4a 3c

3d

4b

3b

Import

Export 4c

Coal exports**: 13.6 mil. T,Top 5 destinations: a. China, b. Netherlandsc. United Kingdomd. South Koreae. Brazil

Coal exports for 2011: 107.3 mil. TCoal exports for 2012: 125.7 mil. T

4

No. 13 carbon dioxide fcff emitter in the world: 450.95 mmt CO2

From international trade on the Silk Road, to fossil fuel exports, to Facebook, globalization has had a long path, but is now in full swing. As ICT innovates the way we are connected every year, the world becomes a smaller placea smaller place with larger problems. We are all interdependent. This implies that generating energy and global sustainability will not be achieved if nations cannot align on goals and cooperate with each other. If you produce wind energy in the North Sea and you need to transport it to the south of Germany, you need international grid cooperation. If you want to build a gas pipeline from Russia to North Korea, you are bound to stumble across several geopolitical issues, to begin with. This means that agreements and planning have to be carefully negotiated on an international scale.

The challenges we face together, worldwide, include tackling climate change, minimizing CO2 emissions, providing food, water and electricity for everybody on the planet and doing it all in a sustainable manner. Sustainable energy for all is on the global agenda. The International Energy Agency (IEA), the United Nations, the European Commission and many other unions or organizations are actively supporting international energy cooperation. For example, the European Commission emphasizes that research and innovation have been interlinked internationally and that the EUs international cooperation policy addresses the needs and opportunities of an interconnected world (ec.europa.eu). Furthermore, we see this active support especially in the IEAs efforts to inform

No. 14 net coal importer in the world: 16.197 mil. TNo. 25 carbon dioxide fcff emitter in the world: 254.87 mmt CO2Natural gas exports 1,159.85 bil. ft3

Netherlands

2

Excerpt of global energy market interconnections and CO2 emissionsfor some of the worlds largest economies



International Cooperation in Energy and Energy Law: Sustainabilitys Toolkit

3a

3e

No. 1 coal consumer in the world - 60% ofthe global coal consumption in industry: 3,826.87 mil. TNo. 1 carbon dioxide fcff emitter in the world: 7,997.04 mmt CO2No. 2 consumer of electricity in the world: 3,271.19 bil. kWh

China

29.4% 1.1%69.5%

7.6% other renewable sources21.8% hydroelectric plants

Renewables

Nuclear

Fossil fuels

RussiaNo. 3 carbon dioxide fcff emitter in the world: 1,642.29 mmt CO2

15.1% 17.2%67.7%

0% other renewable sources15.1% hydroelectric plants

No.1 net gas importer in the world: 4,112.61 bil. ft3 No. 1 net coal importer in the world: 205.978 mil. TNo. 5 carbon dioxide fcff emitter in the world: 1,179.8 mmt CO2-------------------------------------------------

Plans to build gas pipeline from Sakhalin (Russia) to Tokyo

5

Japan5

No. 1 energy consumer in Europe (excluding Russia) and No. 7 worldwideNo. 6 carbon dioxide fcff emitter in the world: 793.31 mmt CO2No. 6 net coal importer in the world: 54.667 mil. T

Germany



Sources: www.cia.gov, World Factbook; www.eia.gov; www.eia.gov, U.S. coal exports set monthly record, June 19th 2013; www.iea.org, Redrawing the Energy-Climate Map, June 10th 2013.

Units of measurement & abbreviations: bil. = billion; fcff = from consumption of fossil fuels; ft3 = cubic feet (1 ft3 = 0.028 m3); mil. = million; mmt = million metric tons (t); kWh = kilowatt hour; T = short ton (1T = 907.185kg).

All data is based on 2012 estimates, except for: * - which denotes 2011 estimates; ** - which denots March 2013 estimates or if it is otherwise indicated in the text.

Excerpt of global energy market interconnections and CO2 emissionsfor some of the worlds largest economies

Legend


and advise governments and industry representatives, which include meetings with ministers and corporate heads and numerous analysis-packed reports (e.g., Redrawing the Energy-Climate Map). In order to maintain the average global temperature increase at 2 C, international negotiations are crucial. What we know is that the results of these negotiations will not be seen until 2015, and new legal obligations will be enforced starting in 2020.

While these negotiations develop, we need to make sure we are prepared for the legal obligations that will be enforced sooner than later, which is why energy law is critical for international cooperation. Law will ensure that new energy developments will have the right mechanisms to be properly introduced into the market. Despite the fact that global preoccupations are still focused on the economy, we mustnt let the issue of climate change off the international policy agenda. The US Secretary of State, John Kerry expresses that climate change grows more urgent. The science grows more compelling, and it screams at us, all of us, to take action. There is no country in the world that does not experience some of the impact of climate change already. (ens-newswire.com, June 24th 2013)

Additionally, energy security is the underlying must of creating a sustainable global energy system. Without ensuring the physical integrity of pipelines and the security of energy data from the new wave of smart energy applications like smart grids and smart meters, the energy sector cannot achieve its goals. Therefore, if we had international cooperation in energy, based on sound energy regulation, and if we made sure that energy security were reinforced, we might just make it to sustainability.

Until then, from international policies to lab research in nanotechnologies, plenty of work needs to be done. A healthy discussion with various experts in the field is always a good way to start. Hence,

in this edition, Laura Cozzi, Principal Analyst and Deputy Head of the Office of the Chief Economist at IEA, connects international cooperation with energy and elaborates on the incentives for policy compliance and collaboration, while Pier Nabuurs, former Chairman of the Dutch Top Sector Energy and Chairman of the Smart Energy Collective, explores why cooperation is so important. Martha Roggenkamp, Professor of Energy Law at the University of Groningen explains how law can help the energy sector and can influence trends in international energy cooperation. Later on, Annika Sponselee, Senior Manager Security & Privacy at Deloitte, and Marko van Zwam, Partner Security & Privacy at Deloitte, share their knowledge of energy security while supporting the combination of ICT and law for tackling security threats. All five experts will explore how the players on the world stage of energy interact and where the glitches in cooperation can be found.

Keeping 2 C with 4 policiesIEAs role has been to inform and advise governments and companies, while protecting energy markets. The agency recognizes the dangers of climate change, but also acknowledges the difficulties of reaching strong and stable international agreements for tackling climate related issues. In order to help countries, the IEA creates complex reports, accessible to the public. The latest one, in anticipation of the World Energy Outlook 2013, is called Redrawing the Energy-Climate Map and was released on June 10th 2013. Besides providing a comprehensive overview of the global energy market, this special report also puts forth four policies that are aimed to help countries comply with energy efficiency and minimizing CO2 emissions, between the present day and the day international agreements on 2020 targets will be reached, which is expected to take place on the 2015 Conference of the Parties on Climate Change, in Paris, France.

The creation of the four policies started from the most important energy aspects

that could be approached in the world, given the current global economic situation and the different concerns that countries around the globe have about energy (e.g., energy security, local pollution), notes Laura Cozzi. She also remarks that the policy recommendations that were kept in the report had to be actionable, practical and most importantly, unaffecting of the economic outlook or prospects of each country no net costs to the economy.

Phasing out subsidies has to be done very carefullyThe four policies selected are focused on efficiency in selected applications where payback is small and the capital investment is not great, which is important for developing countries. One obstacle that needed to be overcome while making the policies was financing. Ms Cozzi: We made sure that the policies would be easily financeable in the current economic situation. Another obstacle was related to fossil fuel subsidies. Ms Cozzi explains that, in some cases, one of the main issues for energy efficiency is having fossil fuel energy subsidized, which makes the payback period for the consumer or for the industry too big. Hence, youre not interested in making the investment either because of financing or because the timing for recovering your investment is too long. So, partially phasing out official subsidies was one of the key points to making energy efficiency analysis and investments doable. The obstacles are seen mostly in countries which are rich in resources. International cooperation is required to understand how best practices, policies and subsidy phase-out can be implemented from one region to another this is crucial. But we have to keep in mind that, in some countries where subsidization rates are over 19%, one cannot think that fossil fuel subsidies can be implemented without hurting the population so it has to be done very carefully, says Ms Cozzi.

Furthermore, two key issues approached in IEAs special report are the limitation of usage and the ban on investing in new subcritical coal. Ms Cozzi: In many cases, the technology is available and there arent many additional costs to provide the same electricity with more efficiency. This measure is taking place in most OECD countries and, realistically, this is a matter of domestic opposition that must be tackled. Local pollution is also addressed through the four policies. The final policy on methane emissions is based on the fact that methane is a more powerful greenhouse gas than CO2. The technologies to take care of

The 4-for-2 C Scenario Policies:Adopting specific energy efficiency measures (49% of emissions savings).Limiting construction and use of the least-efficient coal-fired power plants (21%).Minimising methane (CH4) emissions from upstream oil and gas production (18%).Accelerating the (partial) phase-out of subsidies to fossil-fuel consumption (12%).

Why have these policies been selected?They can deliver significant reductions in emissions from the energy sector by 2020.They rely on existing technologies. They have already been adopted and proven in several countries.Their widespread adoption would not harm economic growth.Source: www.iea.org, Redrawing the Energy-Climate Map



From left to right: Laura Cozzi, Principal Analyst and Deputy Head of the Office of the Chief Economist at the International Energy Agency: Ms Cozzi was in charge of the IEA special report Redrawing the Energy-Climate Map, released on June 10th 2013. She is also in charge of the World Energy Outlook 2013. Pier Nabuurs, former Chairman of the Dutch Top Sector Energy and Chairman of the Smart Energy Collective. Martha Roggenkamp, Professor of Energy Law at the University of Groningen and initiator of the Groningen Centre for Energy Law. Photos from left to right: 2013 OECD/IEA, courtesy of Pier Nabuurs and courtesy of Martha Roggenkamp

this exist and the costs are quite low, but industries have to sit together and decide that its something doable, and this is another area of international cooperation countries must share best practices and so do industries. These types of forums will accelerate action in these specific fields. Exchanges between governments and industries are key for the energy transition, adds Ms Cozzi.

Many people will not be connected to the gridGlobalization does not mean everyone is approaching energy supply in the same manner everywhere. For example, in the case of Sub-Saharan Africa, many people without electricity are not connected to the grid and will not be connected to the grid, because they live in rural areas where grid solutions would be more expensive than installing local technologies, says Ms Cozzi. In certain areas, solar power in off grid solutions is competitive and makes more economic sense than on grid solutions. For those who are without electricity in urban or peri-urban areas, we shouldnt impose the most expensive

options since what we really care about is that they have access to electricity, remarks Ms Cozzi.

Knowledge sharing is going to be part of the solution and companies need to be team players. We need businesses, development banks and NGOs to go to underdeveloped countries and prove that there are valid business cases there, emphasizes Ms Cozzi. The electricity for all issue will be solved when its business case is proven and can attract private capital. Knowledge-based international cooperation is central to all of this.

In the EU, the biggest downfall is that all countries are protecting their own systemWhen we discuss enabling cooperation, common grounds, a sturdy basis or unified principles are a good way to start. According to Pier Nabuurs, the EU does not have a unified regulatory framework to support its energy market. This fact is important to understanding the future of energy in the Union. There are 27

different markets and different market models for energy, as well as numerous different players. Moreover, the regulation between governments and these players are different as well, and each nations vision of what has been done or what needs to be achieved is dissimilar to that of their neighbouring countries. Since energy falls under domestic policy, this makes it difficult to combine energy initiatives and goals. Mr Nabuurs believes that: We have to figure out how to interconnect our policies, and we have to work through commitments. In the EU, the biggest downfall is that there is no unified EU energy system. Hence, it is hard to work together towards sustainability when all countries are protecting their own system.

What the EU can do to stimulate cooperationCurrently, the EU is establishing a number of policies, but all EU directors have separate energy packages, Mr Nabuurs informs us. The EU does not yet have the power to change the system and enable the process to move faster, but we need time. Time will help the transition happen, however there are many variables blocking or slowing down the process. Mr Nabuurs remarks on the fact that the intention of the European Commission is to move to a sustainable energy system, while supporting consumer participation in the market. He notes that the key to turning this intention into reality is to create a local market and energy system founded on smart grids, demand side management, local trading, etc. and based on international system design and standard. In order to do this, we have to stimulate local interest in the matter.

Laura Cozzi and the World Energy Outlook 2013 team. To her left, Fatih Birol, Chief Economist and Director of Global Energy Economics at IEA.Photo 2013 OECD/IEA



Exporting Dutch know-howUsing its knowledge and experience in the field of energy, the Netherlands can potentially inspire other EU countries and enable them to act, especially when it comes to creating opportunities for transmission systems operators (TSOs) to build their own strategy and to look into how they can serve their consumers better, as well as when it comes to helping companies develop new business and policies for the market. According to Mr Nabuurs, the Netherlands is a frontrunner in creating new services and new market systems. In addition, the Dutch have a lot of knowledge in the energy sector, especially for wind and solar technology. Roughly half of the solar panels produced in the world are manufactured with Dutch equipment. There are quite a few Dutch companies cooperating with other EU nations to share their knowledge in this particular area, says Mr Nabuurs. Adding to this, the former Chairman of the Top Sector Energy assures us that part of the top sectors agenda is focused on improving international energy business.

The skilful ally of sustainabilityProfessor Martha Roggenkamps success in the energy sector has been the result of taking the right opportunities. I dont believe in career planning, I believe in taking opportunities when they are there, she says. Philosophically and practically, her words resonate with the energy field and its connection to law. For Prof. Roggenkamp, energy law is interesting because it is a field of law that follows technical developments. Particularly in the pursuit of sustainability, integrating new energy technologies in the market is crucial, hence the law does more than organize the way the energy market functions, it actually guides its evolution.

In the past, energy production was a local activity and the law that fell under the energy category was drafted as municipal legislation. Following WWII, Europe got national electricity grids and national gas grids. This occurred around the time that national laws were developed. Nowadays, a great many new innovative energy technologies are awaiting market introduction. The law has to enable them to pass from being innovations, to being tools that will help make the transition to sustainability.

Windy challenges With each technological development, we have to look if the law is still sufficient to organize that development or whether something new needs to be added, states Prof. Roggenkamp. An example comes from the offshore wind industry. Prof. Roggenkamp informs us that, currently,

there are no legal regimes established to organize offshore wind, and that countries with borders on the sea are still trying to tackle how to organize offshore wind production. Are they going to make use of their onshore electricity law and then extend it to the offshore? Should they make new offshore laws? asks Prof. Roggenkamp. She continues by saying that with technological progressions comes the need to evaluate the existing legal frameworks in place, to see if they are sufficient to support the new developments.

Read more about offshore energy in our Offshore section, pages 20-25

The evolution of the gas marketThe European Economic Community (EEC) (1957) was established around the same time that the Groningen gas field was discovered (1959). Even though more than five decades have passed since then, the EU market continues to be associated with the gas and the electricity sector. These markets are developing from a local, to a national market and perhaps in the future, into an international market. The evolution of the energy market will continue and there is no way of predicting where we will be in a few years from now, however, trends are showing that there should be more cross border cooperation, notes Prof. Roggenkamp. Currently, legislation is aiming to establish cross border cooperation and to harmonize national laws so that they are more comparable for trading electricity and gas, across borders in the EU. In the meantime, we will just have to wait to see how the EU energy situation will unfold, adds Prof. Roggenkamp.

With respect to the rise in unconventional gas reserves exploration, she remarks: Shale gas is considered a natural gas; therefore, it is regulated by all laws applying to natural gas. The difference lies in the methods of extraction. From a legal perspective, the development of shale gas will depend on the legislation created to regulate the extraction methods. The professor believes that the problem is not that there is not sufficient legislation, but that the lengthy process of obtaining a permit in the energy industry will cause the biggest issues in this market.

Read more about the latest developments in the gas market in our Gas section, pages 28-33

What about laws for renewables?Already existing, the legislation for renewables in the EU promises a brighter future for achieving sustainability goals. The Electricity Directive states

that all member states need to have authorizations for energy and electricity production, and then it is up to each member state what kind of authorizations they want to apply. In the Netherlands, the situation is different, since there are licenses for gas production under the Mining Act, but no licenses under the Electricity Act. According to Prof. Roggenkamp, the government should introduce an electricity production permit. This way the government will have the power to influence the development of renewables. Prof. Roggenkamp: For permitting, we need experts to help us. Nevertheless, we have already made a huge step forward since 20-30 years ago we have created the environmental permits, the spatial planning permits and the water permits. She continues by emphasizing that the key is to find the balance between the EU community and national governments. If we have cross border projects, then we need permits from both sides of the border.

At the moment, EU legislation benefits each independent nation when it comes to energy regulation. As it seems, the current regime is drafted in such a way that when a country has a wind park offshore, for example, and it wants to supply electricity to the onshore consumers, that country is going to construct a cable to its own TSO, because this way it gets its subsidies. However, there could be a far shorter connection to the onshore by using cables through another country. In order to tackle this, in the new Renewable Energy Directive there are some instruments included to promote cooperation, so that countries can come up with joint subsidy schemes or joint projects, says Prof. Roggenkamp.



In todays cyber enhanced world, any electronic equipment connected to a network can be hacked. As the Internet expands its bandwidth every day, countries are increasingly dependent on cyber infrastructures that ensure functioning financial services, transport networks and energy grids. Everyone uses the online for business or pleasure, thus everyone is at risk. (cisac.stanford.edu, cyber security threats) The question is not if you will be hacked, but when you will be hacked, says Marko van Zwam. But hacking is just the beginning. When security is breached and data are leaked, privacy concerns arise. Hence, data security and privacy concerns go hand in hand and need to be approached from both the technical and the legal side. It sounds complex, and it is. This is why weve asked Deloittes security and privacy experts Annika Sponselee and Marko van Zwam to give us insight into how energy security and law can work with each other to prepare energy companies and consumers for security threats and their consequences for privacy.

Network security and cyber security are becoming top concerns for the energy sector. Technology security threats are related to intellectual property theft, commercial espionage and operational sabotage. (www.upi.com, Business News, Energy Resources, May 31st 2013) The problem today is that there are no real regulations created for tackling security threats and privacy concerns in energy.

Inherent vulnerabilities For IEA, energy security means ensuring the uninterrupted availability of energy sources at affordable prices (www.iea.org, energy security). Nowadays, large amounts of data are at the basis of all energy production and exchange processes. For instance, sensitive information is constantly circulating between oil and natural gas companies and their counterparts or between the smart meters from millions of households and utility companies. This is happening while threats that are aimed at industrial security are constantly evolving. When we look at grid companies, they are becoming more IT enabled, and more targeted by hacktivists, says Mr Van Zwam. Energy companies are just starting to be familiar with handling the security

and legal concerns that come with such large amounts of private data. These companies are vulnerable. When grid operators security is trespassed, private data are leaked, which in turn causes serious privacy concerns. Handling both security and privacy problems is not an easy task. In line with this, grid operators have to be transparent about how they handle data and approach security and privacy concerns, and they should be able to prove that data is being used ethically and securely, notes Mr Van Zwam.

Data security and data privacy are all about risk management, states Mr Van Zwam. He informs us that risk assessments are critical for pinpointing where a companys weaknesses lie. Equally important is to have a strong hacking detection system, preventative measures in place and a quick response plan to handle security breaches and the privacy concerns that come with data leakage. A response strategy is not only an IT responsibility, but its about people, process and technology, says Mr Van Zwam. He emphasizes the importance of having a continuous process when it comes to security and privacy, with experts who know what theyre doing and understand the field theyre operating in. Prevention, detection and response need to be considered all together when making decisions about how much risk can be taken within an organization, as well as how much should be spent on security and privacy.

Nowadays, with security threats rising and data privacy concerns being imminent, smart grid companies must ensure their products are developed while incorporating security measures and Privacy by Design in the first phase of development. In addition, they should be appointing someone responsible for security and privacy. According to Deloittes experts, security and privacy should not be a general responsibility, but a clearly focused one, approached from both the ICT and the legal side. Enabling security and having Privacy by Design means that companies should consider that once their products are in the hands of the consumer, they should be able to re-secure data and be prepared to handle privacy concerns.

A different kind of translation An interesting practice highlighted in Deloittes activities is related to connecting ICT and law, which is only natural since security (the technical aspect) and privacy (the legal aspect) go hand in hand. Deloitte looks at data from both

perspectives. When handling data security and privacy, there should be a close cooperation between technical experts and legal experts. This is why Deloitte has created its translation service, which allows people with technical knowledge and people with legal knowledge to communicate with each other and understand security and privacy issues as a whole. In other words, the translation service provides a complex overview of both the technical and legal aspects of data privacy, remarks Ms Sponselee.

Deloitte is able to offer this distinctive translation service, which enhances security prevention and the quality of handling privacy concerns for companies. Moreover, Deloitte has top technical experts ex-hackers and legal experts for example, Ms Sponselee was previously a lawyer for Baker & McKenzie who work for the translation service. Ms Sponselee suggests that governments must perform impact assessments in order to monitor if companies are meeting security standards and the legal boundaries for privacy. For instance, smart grid companies are newcomers to the world of large amounts of sensitive data. They need to be aware of the vulnerabilities that stem from their core activity. They need to know that having top security and being able to handle privacy concerns are a must, says Ms Sponselee. In this respect, Deloitte can also handle security and privacy issues from a social perspective. In fact, the company is unique in the Netherlands for having people with both technical and legal expertise handling security and privacy.

What to do when Security & Privacy Threats are Just a Matter of Time?

Marko van Zwam, Partner Security & Privacy at Deloitte and Annika Sponselee, Senior Manager Security & Privacy at Deloitte.Photos courtesy of Deloitte


Energy Law section


RenewabLAW The new concept supporting Dutch sustainability

The concept of RenewabLAW was created by Mr Timmerman inspired by the European 2020 target to have 20% renewable energy production and by the national need for an energy transition towards renewable energy. While the 20% renewables goal is set by the EU, for the Netherlands the goal is to move renewable energy production in the countrys energy mix to 16%. However, the Energy Agreement for Sustainable Growth from The Social and Economic Council of the Netherlands (SER Energieakkoord) may slightly change this national ambition. This target has implications for producers, suppliers and consumers of energy and will be translated into both policies and regulations. These policies and regulations will open new possibilities for e.g. founders of renewable energy projects, but will also have an effect on parties currently active within the energy sector. This is where Mr Timmemans company comes into play.

RenewabLAWs vision is to become a company renowned for its in-depth understanding of renewable law, combined with relevant and pragmatic technical knowledge about renewable energy sources and project management know-how, based on a network of partners, mainly project lawyers and experts.

Projects and servicesCurrently, RenewabLAW is working hard on raising the awareness of companies and local governments with respect to the 2020 ambitions, the legal framework of renewable energy supporting these ambitions and where changes must be made or opportunities can be sought. At the same time, RenewabLAW lawyers provide advice, assistance and support to companies and organizations associated with various projects involving renewable energy.

The company is cooperating with a variety of different partners from diverse backgrounds. There are at least 12 associate partners working with RenewabLAW. As examples for working with associate partners, the company collaborates with Holland Van Gijzen for providing notary public services and with one of the leading attorneys in the Netherlands for energy law services.

An interesting project the company is involved in belongs to Stichting E-Laad (the E-Laad foundation), focused on electric vehicles (EVs). The project is called switchen aan de paal (to switch at the pole) and is aiming to create a market model that will enable increased competition in the area of energy suppliers for the EVs. Switchen aan de paal is a simple and flexible concept that allows consumers to charge their EVs from an electricity provider of their choice, even at the cost of their own household electricity supplier.

In another project RenewabLAW supports WarmCO2, an organization which uses warmth from an industrial complex to heat up greenhouses in the province of Zeeuws-Vlaanderen. Apart from this, the company is working with partners on a way to legally and fiscally structure projects involving solar panels, in order to have the most favourable business case for the parties investing in these panels, mentions Mr Timmerman.

Setting trends RenewabLAW is the first legal initiative that focuses only on renewable law, says Mr Timmerman. Being a trend setter in such a specialized field has its advantages,

but also its disadvantages, comments the RenewabLAW founder. One of the disadvantages is having to explain that the market RenewabLAW is focusing on is a new one and that, although legal challenges are not yet eminent, parties should be aware of the increasing importance these challenges will have.

Mr Timmermans company is aspiring to help the renewable energy market to expand by facilitating, where possible, improvements to the legal, regulatory and fiscal framework which holds back the development of this very market. Mr. Timmerman envisions a company involved in a number of big projects but also intermediate projects which need the support of a lawyer and of legal experts, a legal services company which can become a point of reference for the different parties involved in renewable projects in the Netherlands.

For more information, please visit www.renewablaw.nl

As the transition to a more sustainable energy system unfolds, the supportive role of law increases. Experts in energy law can help from companies to housing corporations to the individual consumer undertake sustainable energy projects in a more efficient and structured manner. RenewabLAW is the upcoming Dutch company that specialises in renewable law. What makes RenewabLAW unique is the emphasis on the legal framework that regulates particularly the renewable energy sector in the Netherlands, rather than having a focus on energy law in a broader sense. Jan Albert Timmerman, founder of RenewabLAW and experienced lawyer in the energy sector, envisioned a company that has project lawyers and other legal experts able to provide companies, local governments or branch organizations the project guidance and the legal advice they need in their renewable energy plans.

Jan Albert Timmerman, Founder of RenewabLAW

Photo: Marjon Zijlstra Fotografie

RenewabLAW is the first legal initiative that focuses only on renewable law

Energy Law section

BASE Advocaten: Litigation experts in the energy sector

In 2004, BASE Advocaten had a significant role to play after the liberalization of energy markets, when grid operators and power suppliers encountered issues with administrative processing. Joris Arts, lawyer specializing in civil advisory and litigation practice at BASE Advocaten explains that in 2004, energy suppliers applied the supplier model on a voluntary basis. This meant that consumers could pay their energy transport costs (due to the grid operator), to the power supplier which meant that the suppliers and the grid operators had to settle the costs among themselves. This has led to a number of proceedings between grid operators and power suppliers. For BASE Advocaten lawyers, these types of proceedings are their expertise, because they entail advising and litigating, which are strong points for the company. Mr Arts: I believe that the lawyers from BASE Advocaten are born litigators. Prior to joining BASE Advocaten, Mr Arts worked at De Brauw Blackstone Westbroek for five years and for the Ministry of Economic Affairs for four years.

With respect to the companys capabilities in agreements between consumers and energy companies, Mr Arts elaborates on BASE Advocatens expertise by providing background information on consumer protection regulation. He explains that in the energy sector in particular, many consumer protection rules are created by EU initiatives. For instance, in anticipation of the opening of the energy market in 2004, the Dutch legislator already chose to incorporate stipulations from the Unfair Commercial Practices Directive in the Electricity Act and in the Gas Act. The directive was not in force at that time. However, in Dutch law, stipulations of this nature belong in the Dutch Civil Code and not in the Electricity and Gas Acts. As a consequence, after The Unfair Commercial Practices Directive had been implemented into the Dutch Civil Code, not all consumer protection stipulations from the Electricity and Gas Acts were needed. This has led to complications because, in the past, the Consumer Authority used to enforce consumer law based on the Dutch Civil Code, but the Netherlands Competition Authority (Nederlandse Mededingingsautoriteit) used to enforce consumer law in the Electricity and Gas Acts. Hence, two authorities were taking care of more or less the same consumer protection stipulations. BASE Advocaten is involved in some of the litigations resulting from this double supervision, which enhanced the companys expertise in energy law. Nowadays, there is only one authority overseeing

consumer protection stipulations, the Authority for Consumers & Markets (Autoriteit Consument & Markt - ACM). The problem of double supervision no longer exists. Nevertheless, a new problem may arise depending on what approach the ACM will adopt. Mr Arts: The ACM will place most of its focus on consumer protection stipulations in order to have working markets. In this respect, BASE Advocaten plays a crucial role when it comes to creating model contracts between consumers and power suppliers. Our company aims to make the best and most beneficial contracts for the energy companies. Additionally, Mr Arts remarks that having a unique authority for consumers and markets ACMs multi-purpose supervisory roles may cause problems on the energy market.

Furthermore, BASE Advocaten was also involved in the white labels issues, in which corporations presented themselves as power suppliers but in reality, were just energy resellers and did not own their own supply permit. The law firm drew up contracts that companies could use with the old white labels. Hence, BASE Advocaten was able to create contracts that make it very clear for consumers where their energy comes from.

In order to deliver the best quality and expertise, in some cases, Mr Arts works closely with Mr De Bree from Wladimiroff Advocaten, who specializes in sanction law. His expertise is very useful in situations relating to supervisors conducts and investigations on power suppliers. Supervisors have various far reaching competences, including the hearing of employees of energy companies, copying computer files and reclaiming them. In this framework, criminal law expertise is very useful in combination with energy law expertise, notes Mr Arts. BASE Advocatens capabilities combined with such partnerships allow the company to offer high-quality services to its clients.

For more information please visit: www.baseadvocaten.nl

BASE Advocaten, the no-nonsense law firm from Rotterdam was founded seven years ago by a handful of lawyers from Nauta Dutilh. The founders wanted to specialize in what they enjoyed most litigation and advising. Among commercial, corporate, contract and employment law, the company also focuses on energy regulation. BASE Advocaten lawyers regularly act on behalf of smaller energy companies. For example, they assess model contracts and general conditions but also litigate against grid operators on disputes that may arise with power suppliers.


Photo: Fred Smulders, Studio Hoge Heren

Joris Arts Lawyer at BASE Advocaten,

specializing in the civil advisory and litigation practice. Mr Arts is one of the partners of the firm.

Energy Law section


Traditionally, Den Hollander Advocaten has an agricultural background and made a great name in the sector. Den Hollander Advocatens lawyers also specialize in environmental law, which includes town and country planning and citizen planning, as well as corporate, labour and energy law. Sustainable energy and, in particular, wind energy is an area of expertise for Den Hollander Advocaten. The firm has been continuously involved in energy law since 1996 when the Regulatory Energy Tax (Regulerende Energie Belasting - REB) was introduced, with various complications to the existing energy supply contracts. History repeated itself in 2004, when the REB was followed by the Environmental Quality of Electricity Production (Milieukwaliteit van de Elektriciteitsproductie - MEP) tax a kWh subsidy paid to domestic producers of electricity from renewable sources and CHP who feed-in to the national grid (www.iea.org, Policies and Measures, Renewable Energy, MEP).

The firms lawyers mainly serve the interests of wind turbine owners and corporations or companies in which these owners are united. Den Hollander Advocatens services include contractual advice, for example, for contracts with

turbine suppliers and energy companies or contracts on rights to erect a wind turbine on a piece of land, and assistance during legal proceedings or where clients are in contact with authorities.

Today, the challenge for wind energy is to find a way to store it. Ms Robijn-Meijer: We would become significantly more reliant on wind energy if we werent so dependent on whether the wind blows or not and if we knew how to store that energy. In the Netherlands, what is especially challenging is the complex legislation. Wind turbines for example are increasingly powerful, thus the prescribed investigations on environmental effects are getting more extensive and time consuming. Also, provincial authorities and national governments have to create integration plans to force decisions and then, we may encounter the NIMBY (Not in my back yard) effect, which is always difficult to solve, explains Ms Robijn-Meijer. When possible, Den Hollander Advocaten handles procedural accelerations, but these are difficult to achieve most of the time. Ms Robijn-Meijer also remarks that if the government would hold on to steady, long-term legislation for subsidies, this would help wind turbine deployment and could avoid past problems as with the REB and the MEP tax.

Den Hollander Advocaten often cooperates with Windunie, an organization that serves mostly farmers who are also producers of wind energy. When developing wind projects, not all individuals are energy law experts and it is difficult to find information on regulations for renewables. This is where Windunies expertise plays a significant part. The organization is responsible for much of the work required in the first phase of wind turbine development. After which, when legal advice is needed, Den Hollander Advocaten plays its role, in addition to taking care of license and contract issues. Moreover, Den Hollander Advocaten aims to simplify the process of placing wind turbines on land by separating the civil part from the

environmental part and the land owner part. Additionally, the law firm works with top professionals in order to deliver quality services. For instance, in the environmental field, the company has Architectural Liaison Officers, technical advisors and ecological consultants as partners.

When it comes to legal adjustments in the Dutch framework for renewables, there are few things that could help speed up the deployment of wind energy generators. Ms Robijn-Meijer exemplifies: If the license duty to erect wind turbines were replaced by a duty to inform or to report turbines with high power, it would most likely speed up the building process. Nowadays, there is an obligation to obtain licenses to build new turbines. It takes quite some time to obtain these licenses. Only having a duty to report would motivate the deployment of wind turbines. The lawyer adds that, in theory, environmental legislation could be changed in such a manner that the national government or provincial authorities alone could determine where wind turbines can be placed, instead of giving that power to local authorities. This would support a national wind turbine roll-out, in a structured and planned manner.

For more information please visit: www.denhollander.nl

Natasja Robijn-Meijer Lawyer at Den Hollander Advocaten,

specialist in employment law, energy law (including wind power)

Photo: Fotostudio Arjo van der Graaff

Den Hollander Advocaten: Helping the Dutch wind energy roll-out

The history of Den Hollander Advocaten dates back to 1944 when L.J. den Hollander senior founded the law firm. Next year we will celebrate 80 years of activity. We are proud to be a company with tradition, says Natasja Robijn-Meijer, lawyer at Den Hollander Advocaten. Currently, the firm has eleven lawyers, wih Mr L.J. den Hollander junior involved as an advisor, after being a lawyer for 40 years. The company is continuously pursuing quality services for its clients.

Windpark De Plaet - Mariapolder, SluishavenPhoto courtesy of Den Hollander Advocaten

Saving energy can have considerable environmental benefits as well as bring substantial financial gain, especially in the (large-scale) construction and industry sectors. Energy efficient buildings maintain their value better and are easier to lend. Lower production costs push up margins and make companies more competitive. Thanks to new technology, increasingly smart and efficient energy solutions are within reach.

Energy: the growth market in times of financial crisisAn increasing number of major and commercial energy users are looking for new ways to cut their energy costs. With the Dutch cabinet suggesting a fiscal greening package and the financial crisis forcing companies to increase efficiency and cut costs, there is no better time than right now to anticipate the quickly changing energy market with smart business solutions. Energie 2013 provides just that. Here you find the latest developments and trends, innovative products and systems and up-to-date information on how to make optimal use of (sustainable) energy in your company and/or project. From biomass, decentralized energy supply and sustainable sources to (heat) pumps, smart grids and metres: whatever solution youre looking for, youll find it at Energie 2013.

Extensive programme on current topicsVisitors can participate in an extensive substantive programme. In a wide variety of activities, lectures and conferences, you can catch up with the latest developments, trends and products.

At the East Netherlands Energy Square in Hall 1, for example, you will find several renowned and innovative exhibitors in sustainable energy and environmental technology from the East of the Netherlands. In cooperation with Stichting kiEMT, this region has formed the GreenTechAlliances, which aims at a top sector in Gelderland and an acceleration of the energy transition. On the Steam Platform you will find specialists in the field of steam technology that will demonstrate their latest products and give expert advice. Furthermore, you can pay a visit to the PassiefBouwen Event and the Solar Event, where you can take part in theme-specific presentations and workshops.

Solar Event: inspired by the sun The Solar Event is a brand new B2B event, organized in collocation with Energie 2013, in Hall 3, in cooperation with Holland Solar, Solarplaza and Solliance. The trade show combines high-quality opportunities to exchange knowledge and experiences with practical workshops, bringing supply and demand together. Here you can gather extensive (product) information about solar energy, from generation to practical application. Go to www.solarevent.nl for more information.

PassiefBouwen EventThe second trade show that takes place in collocation with Energie 2013 is the PassiefBouwen Event in Hall 4. It offers all the latest developments, smartest products and practical information you need for building passive houses and, by doing so, saving as much energy as possible.

The latest developments, trends and solutions for energy professionals

Sustainable energy is one of the fastest growing industries in the world. The B2B trade show Energie 2013 offers you everything you need in order to take advantage of the opportunities in the industry and get a jump-start on your competition.

Trade show Energie 2013 gives head start on energy

Opening hoursTuesday, 24 September: 10:00 a.m. 6:00 p.m.

Wednesday, 25 September: 10:00 a.m. 6:00 p.m.

Thursday, 26 September: 10:00 a.m. 5:00 p.m.

Location Brabanthallen (Hall 1 4), Diezekade 2, Den Bosch, The Netherlands

Free entrance Go to energievakbeurs.nl/register to request your free entry ticket. With your badge, which will be sent to you by mail, you also have free entrance to the Solar Event (Hall 3) and the PassiefBouwen Event (Hall 4).

More informationW www.energievakbeurs.nlE [email protected] +31 (0)30 295 2731

Photos courtesy of VNU Exhibitions Europe


Energie 2013

Newly expanded, more innovative than ever and also part of Sustania 100 (www.sustainia.me), PowerMatching City has entered its second phase. The project is based on centralized and renewable energy systems, which connect the supply and demand of electricity and heat through a smart grid structure. PowerMatching City is a European smart grids field trial which began in 2009 in Hoogkerk, the Netherlands with 25 households. In 2012, Henk Kamp, Minister of Economic Affairs of the Netherlands, gave the official start to the second phase of PowerMatching City. Today, there are 42 households taking part in the project. Next to solar panels, heat pumps and micro CHPs (combined heat and power systems), all households in the project use smart meters and smart household appliances and have electric vehicles supplied by Essent, which are virtually connected to the system. The project is coordinated by DNV KEMA, the company that is also behind the revolutionary concept of offshore solar fields SUNdy. NRG Magazine sat down with Frits Verheij, Director Smart Energy at DNV KEMA Energy & Sustainability, to find out more about the future of energy efficiency.

Frits Verheij is Director Smart Energy at DNV KEMA Energy & Sustainability and Chairman of the Top Consortium for Knowledge

and Innovation Switch2SmartGrids from the Top Sector Energy in the Netherlands.

Photo: 2013 DNV KEMA


Energy Efficiency with Frits Verheij: Smart grids reloaded & offshore solar

Energy Efficiency


Although Europe has a great many developments involving smarts grids and smart meters, PowerMatching City is the first EU project that researches the conditions for the functioning of a real-life smart grid system. In its first phase (2009-2011) the project focused on the technical conditions of creating a successful smart grid system. Now, in its second phase, its aim is to create a new market business model how to save energy costs and where and how tariffs should be applied, depending on different circumstances. DNV KEMA along with Enexis, Essent, Gasunie, ICT Automatisering, TNO, Delft University of Technology, Eindhoven University of Technology and Hanze University of Applied Sciences are PowerMatching Citys project partners.

We know how much sustainable energy production there is in the households and how much energy is used for storage or consumption.Special software called the PowerMatcher has been developed for the project. The software detects high energy traffic points and ensures that supply and demand within the households can be fine-tuned automatically. All smart appliances within PowerMatching City are powered by renewable energy sources as much as possible, which are equipped with sensors that determine when appliances should be turned on or off in order to use energy when it is abundantly available and minimize energy costs wherever possible. Moreover, PowerMatcher facilitates data collection throughout the process. The data are stored per household and - on an aggregated level - also on an external server for analysis. Consumers can figure out how to regulate their energy behaviour through a secured website. One of the most interesting aspects of PowerMatching City is how electricity

produced by renewables is stored in the houses. Frits Verheij explains: We use the actual data of both the consumption and the production of energy from the devices connected to the system. When the sun is radiating and there is no need to use the energy produced, that energy is stored as heat in water boilers or in the batteries of the electric vehicles connected to the houses.

The PowerMatcher allows grid operators to know what the status of energy capacity is at all times and where it can be distributed. This also benefits energy companies, since they know how much energy can be matched with another area, if they should supply more energy to the system or if they should absorb the energy in the system and sell it to others. The idea is that we know how much sustainable energy production there is from the households and how much energy is used for storage or consumption. If there is a surplus, the price will be lower for the consumer, remarks Mr Verheij.

The results of the first phase of the project have shown that the energy consumption curve is flatter when connecting energy flows through electric cars, micro CHPs and heat pumps. The second phase has already started. Once the project is fully developed, we expect to have free movement of all energy flows (gas and electricity), flexible tariff rates, new ways of invoicing and other innovative market mechanisms, says Mr Verheij.

We call this a technology step-up.An innovative practice in PowerMatching City is encouraging new companies to join the smart grid, while respecting its rules. Companies that would like to try out new power matching technologies can join the project, since it is established as a pro-demonstration system. We call this a technology step-up. For instance, NXP, which is a semiconductor test company, will be applying some of its chip technologies to scooters and other devices in the system, notes Mr Verheij.

From offshore wind to offshore solarPowerMatching City is one example of the innovative power of DNV KEMA. Another one, still in its concept phase, is already making waves in the global energy sector. SUNdy is a new offshore renewable energy system, planned to be turned into a prototype. A Joint Industry Project with different stakeholders will be established in order to build this prototype. The SUNdy concept takes advantage of the suns reflection on water to produce energy from a floating solar field. Since roughly 50% of the worlds population is living within 100km of coastlines, SUNdy could help generate the electricity these people need. (www.dnvkema.com, SUNdy)

The system is designed to be easily scaled up, flexible and it is based on triangles filled with solar PV panels. Depending on demand, tens or hundreds of solar rings can be easily added to these floating devices in order to produce electricity in remote locations around the globe. SUNdy could be deployed from coastal communities, to offshore facilities and to island resorts. For instance, in Europe, The Mediterranean Sea would be a good location for SUNdy, especially since the sun is so generous in the south of the continent.

DNV KEMA is all about continuous innovation. Hence, new research on smart grids and on super grids the counter part of smart grids but for high voltage systems is expected. A super grid could connect, for example, all offshore wind farms and EU countries to each other with very high voltage DC grids. In the future, we could transport high volumes of power through Europe and across the globe. With plans for such applications and the possibility of replications elsewhere on the planet, energy efficiency could soon be the global norm, not the global desiderate that it is now.

The quest for making the electric industry more customer-interactive has crossed paths with the smart grid the technology that can make the generation, transmission, distribution and consumption of electricity more efficient than ever before (energy.gov, smart grids). For 2012, the European Commissions official database includes 281 smart grids projects and 90 smart metering pilots and roll-outs in Europe (ec.europe.eu, Smart Grids projects in Europe, 2012 Update).

NRG Magazine presents: The Revolutionary Offshore


Offshore section

Climate change has been a wake-up call for many countries and has amplified the need for more complete energy solutions, turning away from traditional energy sources. The pressure for such developments has led to the creation of next generation offshore wind farms. The Kyushu University Wind Lens project in Japan has been one of these advancements. Offshore floating wind turbines have proven to be a key solution to meeting EUs electricity demands 4 times over (www.cleantechnica.com, July 31st 2013) In the US, there are several projects underway. Three of the projects approved by the Department of Energy (DOE) will be selected by the DOE to be commercially operational by 2017, as long as they meet requirements for innovation. (www1.eere.energy.gov/wind/18842, December 12th 2012)

New research shows that there are several ways to make offshore wind power more energy efficient. First, there is the vertical-axis wind turbine (VAWT), which requires far less maintenance than the horizontal-axis wind turbines (HAWT). VAWT designs also have better stability and provide a greater chance for capturing wind direction. Next, there is the new simulation software (cleanweb technology) which improves turbine designs, giving them greater durability over time InVest is an example of this kind of software that predicts energy production and the value of wind energy. Another efficiency nugget comes from China. The countrys Envision Energy company demonstrates a 2-blade turbine, more aerodynamic system instead of a 3-blade one (www.envisioncn.com). Furthermore, we can look at Japans Wind Lens project mentioned above for a new and improved wind turbine design lighter and made with stronger rare earth minerals which boosts the amount of energy generated. Additionally, Bayer Material Science is working on a chemical coating to overcome the challenge of built-up ice on the turbine blades during winter. Yet more to come from the US, innovation demands have determined the University of Maine to deploy turbines on spar buoys, collecting vital geographic suitability data in order to reduce overall project costs. The system is called LIDAR and uses laser beams, light detection and ranging systems to determine suitability. Still on the topic of offshore weather, another technological advancement is the Lockheed Martin Wind Tracer which incorporates the first commercial use of the worlds strongest long-range weather radar. (www.breakingenergy.com, June 11th 2013, technological innovation)

The Netherlands has also set a prime example for innovative technologies. It has taken the Delft University of Technology four years of research and testing to develop a miniature wind turbine, but finally it is available on the market. The miniature turbine is called the Windchallenge 1.7, weighs only 10kg and has a blade span of 1.7m. Because its so small and light, the mill can easily be placed on roofs, light poles and greenhouses. Due to patented new technology and high-tech materials, the mill is silent, efficient, affordable and easy to combine with solar panels. The turbine produces around 500kWh per year, at a wind speed of 4m/s and 900kWh per year at 6 m/s. What else can we ask for?(www.windchallenge.com)

If the Danes have enough offshore wind energy to cover the equivalent electricity consumption of 1 million households in Denmark, they must be doing something right. The secret is the countrys ambitious energy agreement that states that around 35% of Denmarks

energy will come from renewable energy sources by 2020, half of which will come from wind energy. This will make Denmark the most energy efficient country in the world. (www.investindk.com, March 23rd 2012, historic energy agreement) The simple fact that Denmark is indeed a windy country is contributing to these ambitious energy goals. However, this is not the only reason behind such plans. Denmarks wind industry was the first in the world to be developed and has created core competencies in production, design and installation of wind turbines that are sought after globally. Moreover, most, if not all Danes are in support of wind power, since onshore wind power is cost competitive, wind is inexhaustible, stable and free-of-charge. (www.denmark.dk, wind-energy)

Even though its potential is immense, offshore energy is not all breezy. All these offshore operations can lead to emergency situations. Lets look at oil and gas extraction in rough areas, for instance. Especially in the Arctic spills and other accidents are very difficult to tackle. This is why new technologies to respond to oil spills include: unmanned aerial vehicles with optical, infrared, radar and other sensing systems; unmanned underwater vehicles; surface radar systems with portable power supplies and the remote sensing of ice conditions through cloud cover using radar technology. (www.adn.com/1936344) In addition, in 2012 a novel gel was discovered by Mike Chung and Xuepei Yuan. The gel can absorb 40 times its own weight in oil and forms a soft solid that is strong enough to be scooped and fed into a refinery to recover the oil this helps solve the problem of separating split crude from the water it pollutes. (www.reuters.com, USBRE8A10NP20121102, February 11th 2012) Finally, Chris R. Chase and Leonard G. Roberts from the Inter Ocean Systems Conference describe the development of an oil spill detection and alarm system that provides a reliable, cost-saving mechanism for containing and/or preventing accidental discharges of hydrocarbon-based pollutants. This system is similar to a smoke alarm, but for oil spills. Oils are known to fluoresce. The newly developed oil detection sensor detects the presence of oil by means of exciting and measuring fluorescence. (www.slicksleuth.com, IOSC Conference)

With all these innovations and plans for tackling challenges, from energy efficiency to emergency situations in harsh environments, offshore energy has come a long way. Still, innovation is not the end. The idea is to have these great solutions introduced into the market at reasonable costs. In this respect, the appropriate legal framework has a say in how the newest devices and techniques in offshore energy can enjoy the leap from demonstration projects to roll-outs.

NRG Magazine presents: The Revolutionary Offshore


Offshore section

Offshore for Sure

Large areas, heavylift capabilities and the corresponding equipment thats what our offshore terminals in Germany and the Netherlands provide. With a direct access to the North and Baltic Sea they are ideally located. From planning and handling to storage we take care of your offshore wind logistics. Round the clock and 365 days a year.More information at: www.buss-ports.de

The Offshore Energy Exhibition & Conference addresses the technical, operational and commercial challenges associated with developments and growth in the offshore energy sector. Held on the 15th and 16th of October 2013 at the Amsterdam RAI, this two-day conference includes an exhibition where 500 supply chain companies are expected to attend and showcase their products and services. In addition, there is an accompanying conference that covers key topics and solutions for the offshore community.

Offshore Energy is the fastest growing assembly of offshore industry professionals in Europe. Founded in 2008, it has broken attendance records year after year. The 2012 edition attracted 7,632 visitors from 45 different countries. The number of exhibitors, visitors and conference delegates is expected to be even greater in 2013:

Expected number of exhibitors: > 500 Expected number of visitors: > 8,500 15,000 m2 exhibition space Expected number of delegates: > 900 Exhibitors, visitors and conference delegates from over 50 different countries

OE13 Conference Preview Securing our energy future is the crosscutting theme of this years conference - this is what all industry professionals aim to do. From developing innovative solutions to extending the lifetime of gas fields in the North Sea, to designing new offshore wind access systems and from new drill ships to tests with tidal energy generators. Working in the offshore oil, gas and energy industry

ultimately means contributing to the global security of energy supply.

The two day conference program offers a full slate of C-level panels, technical sessions and side events that will feature an international body of expert speakers. Confirmed speakers represent Fugro, Wood Mackenzie, Wageningen University, Schottel, Fred. Olsen United, Green Giraffe Energy Bankers, DNV and TKI Wind op Zee (Top Consortium for Knowledge and Innovation Offshore Wind).

East AfricaConference sessions focus on three themes: North Sea exploration and production, next-frontier E&P projects and renewable marine energy. For the first time, Offshore Energy also features a session on East Africa. Fugro and International SOS have confirmed their participation in this session.

Industry PanelBuilding on the success of last years inaugural industry panel, Offshore Energy offers a panel discussion, once again, bringing C-level representatives together in upstream oil and gas. Moderated by John Andrews -editor of The Economist- this year, the panel discussion will focus on the future structure and business strategies for the offshore industry, the increasing complexity of the industry and how decision makers up and down the value chain can deal with this increased complexity.

More information on the Offshore Energy 2013 conference program can be found on offshore-energy.biz/ conference

Photos: Sander Baks

Offshore Energy Exhibition & Conference 2013


Offshore Energy Exhibition & Conference 2013

Program at a glance

Tuesday 15 October 2013

[Panels] 10.30 12.30 Industry Panel 2013

[Technical sessions] 10.30 12.00 Advances in wave and tidal energy13.30 15.00 North Sea exploration & production15.30 17.00 State-of-the-art vessels for the offshore industry

Wednesday 16 October 2013

[Collocated event] 9.00 15.30 4th Offshore Wind Installation and Maintenance Conference

[Technical sessions] 10.30 12.00 Developments in diverless subsea interventions13.30 15.30 Opportunities in East-Africa

[Side event] 13.30 15.30 IRO Decommissioning Seminar

Preliminary program as of July 1st 2013.

The program may be subject to change.

Offshore for Sure

Large areas, heavylift capabilities and the corresponding equipment thats what our offshore terminals in Germany and the Netherlands provide. With a direct access to the North and Baltic Sea they are ideally located. From planning and handling to storage we take care of your offshore wind logistics. Round the clock and 365 days a year.More information at: www.buss-ports.de

NRG Magazine presentsOffshore Energy: What about the challenges?Despite the benefits that offshore wind generation could have for the environment, there are still some challenges to be faced. First off, the oceans surface is a brutal place. The installation of wind farms is far more complex than on land since wind turbines must endure big storms, waves and corrosion from salty water and air, which also explains why maintenance costs are more than double compared to onshore. Furthermore, wind turbines can only exist in shallow waters. So far, they have been installed in water no more than 30 metres deep which is difficult to find across the globe. Offshore wind remains expensive. If we want to drive these projects further, it will require the development of floating turbines which will cost even more. Among offshore challenges there is also the threat that these turbines pose a danger to the oceans habitat and sea animals. Electromagnetic cables could also be harmful to sea and ocean life. Therefore, there is still research to be done to overcome these challenges. (www.makanipower.com, February 2013, offshore challenges)

Oil and Gas Offshore PlatformsDrilling and production platforms are among the worlds most extreme workplaces in the world. For this reason, safety concerns are a prime challenge to overcome when it comes to offshore oil and gas production. Among the must-haves of offshore platforms are increased monitoring of heavy operating equipment and safety-rated interlocks and, with the development of larger, more complex fields also more measurements, controllers and actuators on the sea floor, which means more sophisticated strategies are needed at the sea floor. (www.wintershall.com, production-technology, offshore) Another challenge is ensuring environmental preservation through offshore oil and gas developments. This includes preserving the oceans and also limiting greenhouse gas emissions. (www.total.com, the deep offshore, challenges). Overall, issues we must conquer include safety concerns, the preservation of the environment, the delays caused by trial and error, rising costs and the fact that all these new developments will challenge traditional methods of extraction. (www.mareforum.com, Oslo shipping forum)

Regulatory Uncertainty According to the European Wind Energy Association (EWEA), the offshore wind industry is twice as healthy as in the previous year. A year before, within the first six months, the EWEA found 132 offshore wind turbines throughout Europe, with combined capacity of over 1 GW that were fully grid-connected. This year, they found 277, meaning that offshore grid-connected wind turbines have been multiplied by two in the first six months of 2013. At the end of June this year, the EWEA estimates that Europe has 1,939 turbines offshore, with a combined capacity of 6040 MW. These turbines are fully grid-connected in EU waters at 58 wind warms in 10 different countries. Despite these advancements, financing for offshore wind farms had slowed down significantly during the first six months of 2013. According to the EWEAs policy director, Justin Wilkes, orders are lacking for placing offshore wind turbines and so are substructures and components. All these issues indicate regulatory uncertainty in offshore markets. (www.renewableenergyworld.com, July 16th 2013)


Offshore section

NRG Magazine presentsOffshore Energy: What about the challenges?

Arctic ChallengesRemoteness, darkness, ice and low temperatures working in the Arctic is not exactly a walk in the park. In the past, with the presence of sea ice in the Arctic, oil and gas developments were impossible. Now, as seasonal ice increases, offshore exploration can further develop. This could add significant economic benefits, but also pose extreme environmental challenges with pollution, contaminants, oil spills and health and social impacts. Increased industrial access to the Arctic causes water pollution, including garbage, sewage and invasive species from ship ballast water. Toxins that can harm sea life and even humans include persistent organic pollutants (POPs), heavy metals and radionuclides. We have not yet developed effective technology to clean up oil spills, all together. Oil spills cause tremendous damages to the environment. Moreover, industrial activities may affect the traditional way of life for indigenous Arctic peoples. (www.oceansnorth.org, social environmental risks) Most importantly, the reason these challenges exist is because the response gap for spills is too large which makes it difficult to prevent or fix these issues once they arise. (worldwildlife.org, arctic drilling assessment)

Offshore Grid ConnectionIt is clear by now that we do know how to produce renewable offshore energy, however, then comes the question: when we do overcome production challenges, how do we connect the energy so that it reaches consumers? There are several challenges when it comes to offshore grid connections. First, we have the offshore grid maintenance, which is expensive and requires a lot of time, monitoring and money. Then there is the task of tackling multi-terminal operations and, adding to this, rising key commodity prices needed to create the offshore grids may pose a challenge as well. Then, if we look at EU standardization, the challenges here are related to fault behaviours, system protection schemes and control and protection. Finally, legal challenges include the lengthy process of obtaining a license to operate. (www.ewea.org, Offshore grid report)


Drilling - Technological ChallengesInnovation is crucial to develop offshore drilling. One of the biggest challenges is to add a drilling function to a floating production, storage and offloading system (FPSO), in order to have minimal reliance on shore-based facilities. The obstacle in developing these technologies is the economic challenge itself, since the currently experienced oil prices dip does not allow funding for significant technological advancements. To reduce costs, operations through a hub system could be created. The hub system handles production from two or more producing zones at a single facilitys measurement point. Here we see the real regulatory and technical tasks that come with production and measuring production. Another factor that causes difficulties in developing these new technologies is the deeper and colder waters, which create expensive problems for hydrates, paraffin and solids build-up. (oceanservice.noaa.gov, offshore challenges)

Offshore section

Cooperation is good, but TLC is better

From a financing perspective, the North Sea has offshore wind potential in five jurisdictions, each of them having its own subsidies and regulations. Financing is a challenge, the biggest risk being regulatory risk. Especially in the time before the financial close, when all the pieces come together as permits, subsidies, financing and building arrangements, agreements with windmills producers etc., all ready for one big signing ceremony. Normally it takes years to come to the close, and in these years one of the worst things that could happen is changes in regulations.

Deutsche Bank used to have the so-called Climate Change Advisors in New York. They made very useful research and one I liked most was on regulatory risk. They disseminated the risk into three characteristics: good regulations should be transparent, have very long longevity and offer certainty - in short TLC. They even got as far as looking at 100+ countries around the world and grouping them on their TLC regarding clean tech and renewable energy.

My own interpretation has been: its more advantageous to have second best regulation that stays unchanged for years, than a string of better ones that change all the time. For example: top regulation from a bankers perspective is the setting for German renewable energy. Long-term guaranteed tariffs and guaranteed feed in to the grid made the financing into a retail product. Although other countries (and the German industry) are wondering whether it is efficient and couldnt be done cheaper, from a financing perspective the TLC of the German regulations is super.

However, the German surge in renewable energy also made clear that the effect of a lot of decentralized renewable energy projects on the transmission system is huge. So huge, that the interdependencies with regional and international grids got problematic. International cooperation is needed and even more so now that the rest of Europe is expanding its renewable generation. Immediately, the first question popping up is: who will pay for that? Thats a political question and therefore tricky to answer. Meaning it will take time, will change regularly and the outcome by definition will be unsure - the very opposite of TLC.

Renewable energy growth makes more international cooperation necessary. We should ensure that future regulation resulting from this cooperation is TLC proof: transparent, long-term and certain. Otherwise financing will be troublesome and the growth of renewables would be frustrated or not happening at all.

Gerard van BaarHolland Financial CentreManaging Director Centre for Finance & Sustainability

The Holland Financial Centre foundation is a joint public/private venture launched by a number of parties in the financial industry and the government,

who have joined together to form a broad-based interest group. The objective of HFC is to develop initiatives aimed at preserving a strong, open,

internationally competitive financial industry in the Netherlands, and to retain existing jobs in the industry and create new ones.

One of the focal points of HFC is Finance & Sustainability. The Centre for Finance & Sustainability started the discussions around the Green Investment

Corporation (Groene InvesteringsMaatschappij), initiated the webportal www.FSinsight.org, a platform for discussions on Finance & Sustainability

between academia and business. T