Views of Finnish experts on the rate, direction and key implications

of technology disruption

Tero Ahonen & Mikko Jalas

1

• Analysis on the rate, direction and impactsof the technological disruption

• Mapping of the opportunities and challenges for Finland’s strengths

• http://www.smartenergytransition.fi/teknologiamurros

2

SET research on DisruptiveTechnologies

SET research on DisruptiveTechnologies

3

Delphi workshop on 6th of

June

Summing up the pieces:Technology outlook for

2030, reports and academic

publ.

Phase 1 1/2016-2/2016

Phase 5 Summary

Phase 2 3/2016

Phase 3 5/2016

Phase 4 6/2016

Delphi round 2 (May)

Delphi survey

round 1(March)

Technology reports on solar PV, wind and BESS (January-April)

SET expert interviews for Delphi develop.

Review of global megatrends affecting the energy sector(January-June)

Background briefs for Delphi workshop

Results available inSET website• Discussion papers combining Delphi survey

and workshop results with information on the international technology development

• Assessment of results• In respect to global megatrends

• In respect to other relevant Finnish scenarios

• Background materials for the Delphi survey

• Reports of answers to survey questions

4

• Development of Delphi survey with expert interviews

• Two-round Delphi survey about changes in the Finnish energy sector and the role of different technologies on this change

• Delphi workshop about Finland in 2030, how different technologies are realized then, and what (policy) actions are needed for their uptake

5

Delphi research process

• Seven technology/theme-divided tables with discussion on

• Main drivers for the use of disruptive technology in Finland in 2030

• How and where the discussed technology will be realized in Finland?

• What is missing/needed for the uptake of the discussed technology?

6

Delphi workshop aboutFinland in 2030

0 % 20 % 40 % 60 % 80 % 100 %

E: Energy efficiency of buildings

G: Digitalization and demand…

B: Solar heat, heat pumps and heat…

C: Wind power

D: Biomass-based energy systems

F: Peak-load and reserve capacity

A: PV

Knowledge of thematic areas among the respondents:

Limited Adequate Good

Background of Delphisurvey respondents:

7

Under 30…

31-40…

41-50…

51-60…

Over 61…

0

9

16

13

1

Number and age of respondents

Large company

SME, < 200 employees

Small company, < 10 employees

Public sector

NGO

Academia

Other

Respondents' main area of activity

0 % 10 % 20 % 30 % 40 % 50 % 60 % 70 % 80 % 90 %100 %

Wave energy

CCS&CCU

Fuel cells

Power to chemicals

Lithium batteries

District heat storages

Geothermal heat

Forest biomass in new applications

Solar heat

Waste streams in energy production

PV

Automated demand response

Windpower

Heat pumps

35

24

14

7

11

7

3

3

5

3

0

0

1

1

9

15

13

22

17

14

19

17

10

9

6

8

2

1

3

4

9

11

16

15

19

16

24

26

29

16

18

15Not significant

Promising newalternative

Has been takeninto commercialuse

Has displacedsignificant partsof the existingenergy system

First survey results on the importance of different energy technologies in Finland in 2030:

0 % 10 % 20 % 30 % 40 % 50 % 60 % 70 % 80 % 90 % 100 %

CCS&CCU

Lithium batteries

Fuel cells

Wind power

Heat pumps

District heat strogares

Wave energy

Solar heat

PV

Geothermal heat

Power to chemicals

Waste streams in…

Forest biomass in new…

Automated demand…

20

17

13

9

10

11

11

10

9

5

8

4

5

2

11

16

15

26

19

18

14

19

19

22

16

24

20

12

No significant poss.

Some poss.

Significant poss.

First survey results on the export potential of different energy technologies in Finland in 2030:

10

Studied technologies in Delphi workshop

Disruptive electricity

production methods:

Wind and solar PV

New usage possibilities of

renewable resources:

Biomass-based energy system

as a part of overall solution

Balancing of demand and

production:

Management of peak power

demand

Automated demand response

Changes in the energy

consumption:

Energy demand in buildings

Decentralized heating

solutions

Wind power

• Disruptive source in the Nordic energy system

• LCOE in latest Nordic projects ~45 €/MWh• Supported also in Finland with feed-in tariff system

• Finnish government objectives 6 TWh→9 TWh

Decreases notably

0%

Decreases24%

Remains31%

Increases38%

Increases notably

7%

Acceptance of wind power

• Respondents expect over 10%for wind power in Finland in 2030

• Notable share of offshore farmsare also expected

Wind power Below 2%14%

Ca. 2-10%32%

Ca. 10-20%34%

Ca. 20-30%17%

Over 30%3% Share of wind power

in production

0 % 50 % 100 %

Which portion investments isbased on domestic financing?

Which portion of wind powercapacity is offshore?

10%

30%

50%

70%

Solar PV

• Part of the global disruption in energy sector

• In Nordics the effect is more limited • Currently installed capacity in Finland ~20-30 MW

• TEM projects 0.2 TWh/a for 2020 and 0.7 TWh for 2030, corresponding ~250 and ~875 MW

13

0 % 20 % 40 % 60 % 80 % 100 %

What portion of solar PV production is basedon building integrated&installed systems

What portion of solar PV production is basedon private microgeneration

What portion of produced electricity is sold tothe grid

10 %

30 %

50 %

70 %

90 %

Below 1%15%

Ca. 1-5%20%

Ca. 5-10%40%

Ca. 10-20%20%

Over 20%5%

Share of solar PV in production

• Materialization is expected tohappen in building level

• Compensation of own energyconsumption, possibly with battery energy storages in 2030s?

Solar PVNot significant

15%

Only small significance

12%

Some significance 52%

A lot of significance

18%

Very significant3%

Significance of solar PV in 2030

”Wind power is disrupting current energy system due to lowered electricity prices: time to shift from subsidies to market-based schemes, such as carbon tax?”

”Offshore wind farms will be installed in Finland, as theirprices will decrease to competitive level”

”With increased wind and solar, flexible consumption willbecome more and more important part of energy system. Also new transmission connections and biomass-basedplants will play role in this change”

15

Workshop comments on wind and solar

Biomass

• “Cornerstone” of Finnish energy system through their use in CHP and as fuels

• 39 % emission decrease target for sectors outside ETS is to be solved e.g. with the use of biofuels

Use of forest resources 2008-2012

Sustainable yield of forest resources 2030-2039

Under 5%3%

5-15%16%

15-25%28%

25-35%34%

Over 35%19%

Share of biomass in energy production

• Future applications of biomass should target to carbon-neutral products with added value

• Fuels preferably from side streams, pulp vs. fuel market prices?

Biomass

How much of the energy demand intransportation will be covered with biofuels?

How much of the energy demand in heatproduction will be covered with biofuels?

How much of the energy demand in powerproduction will be covered with biofuels?

10 %

30 %

50 %

70 %

90 %

Automated demand responsesolutions• Allows balancing of demand with fluctuating

production• Export potential as services utilizing digitalization

and modern electricity meters

• Especially feasible with systems having storagecapacity (households, industry applications)

Not significant3% Only small

significance3%

Some significance

26%A lot of significance

50%

Very significant18%

Significance of automated DR

• DR is expected to be central part of Finnish energy system in 2030

• Open data access and real-time interaction were seen as key factors for this development

Automated DR

7

0

3

7

0

25

37

23

11

20

29

20

29

19

3

29

30

32

33

47

11

13

13

30

30

0 % 10 % 20 % 30 % 40 % 50 % 60 % 70 % 80 % 90 % 100 %

Loads in households

Automatization and with novel control algorithms

Reorganization of industrial processes

Realtime interaction with customers

Communication between systems

Significance of different factors in automated DR

Not significant

-

-

-

Very significant

3

0

0

0

31

17

13

13

28

41

32

6

24

24

16

35

14

17

39

45

0 % 20 % 40 % 60 % 80 % 100 %

Energy storages

Domestic reserve power

Strong transmission lines

Demand mgmt./response

Significance of different factors in manag. peak power demand

Not significant

-

-

-

Very significant

Management of peak powerdemand• Automated DR cannot solely fulfill peak power

demand • Topical in Finland, as peak demand (15100 MW)

required importing of ~4000 MW

• Who will invest in (peak) power plants, if it is morelucrative to have heat plants instead?

Below 1000 MW28%

1000-2000 MW22%

2000-3000 MW19%

3000-4000 MW25%

Over 5000 MW6%

Importing during peak demand

”Electricity prices should reflect more the present status in electricity markets (=wider use of spot pricing)”

”Low electricity prices do not support building of traditional power plants. This lack needs to becompensated with wide implementation of demandresponse systems”

”Standardization&legislation should support the uptakeof DR and electric vehicles in new buildings”

21

Workshop comments on DR and peak power

Summing of the researchfindings• Electricity markets will be a market place for

demand availability with higher price volatility• Digitalization and related services vs. bulk-based

materials as export solution then?

• The uptake of renewables is also related to theuptake of storage solutions

• Pumped hydro also in Finland, solar PV with batteryin households or as electric vehicles?

23

Materialization of smart energydisruption

- Buildings- City districts, villages- Regions- Nation

24

25

Region• Regional RE-targets

• Peak-load as regional issue. Energy security. Priority users

• Urban transition: in high-price housing stock. Urban EV.

• Energy poverty. Low service in rural areas. Price caps. Low quality electricity.

• Forest biomass logistics for CHP

• Coal-power plants and landfills as sites for wind / PV

• Wind power technology ≠ massive three-blade turbines

• District heat storages and heat pumps for demand response and seasonal storage

• Waste-water heat recovery

• Org. waste and sewage into biogas and micro CHP

• Overlapping commercial and community networks

• PV is used to attract cars. EV charging in commercial and work environments

• Co-operatives in wind power production and demand response markets

• City plans for energy solutions & power limits for properties

26

Block, district or village

27

Buildings

• Two-way electricity and heat networks. Heat pumps, PV and solar heat.

• Demand response: Great interest, high tech & automation, service and personal profiles in DR systems. Real-time DR. SMS DR. DR as virtual battery.

• Home based living & biofuel heating

• EV and biogas/methane powered vehicles

• Certification of skilled low-energy house builders. Demolition & prefabrication & rapid construction. Ongoing maintenance work.

• Overheat and hot in summer, no snow in winter?

• Nordic electricity market

• Storage capacity – hydro / pump

• Wind turbines along the main road network, turbines halted for summertime in recr. areas.

• Taxing of PV capacity or PV production

• Consolidation of industries, large efficient units

• Service availability across country (EV, biogas?)

• Standardization of equipment and data formats. Data availability vs privacy

28

Country / State

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