• Energy Research

Natural gas based hydrogen production with carbon capture and storage is referred to as blue hydrogen. If substantial amounts of CO2 from natural gas reforming are captured and permanently stored, such hydrogen could be a low-carbon energy carrier. However, recent research raises questions about the effective climate impacts of blue hydrogen from a life cycle perspective. Our analysis sheds light on the relevant issues and provides a balanced perspective on the impacts on climate change associated with blue hydrogen. We show that such impacts may indeed vary over large ranges and depend on only a few key parameters: the methane emission rate of the natural gas supply chain, the CO2 removal rate at the hydrogen production plant, and the global warming metric applied. State-of-the-art reforming with high CO2 capture rates combined with natural gas supply featuring low methane emissions does indeed allow for substantial reduction of greenhouse gas emissions compared to both conventional natural gas reforming and direct combustion of natural gas. Under such conditions, blue hydrogen is compatible with low-carbon economies and features climate change impacts in line with green hydrogen from electrolysis supplied with renewable electricity. However, neither current blue nor green hydrogen production pathways render fully “net-zero” hydrogen without additional carbon dioxide removal.

Mitigation-Process Integrated Assessment Models (MP-IAMs) are used to analyze long-term transformation pathways of the energy system required to achieve stringent climate change mitigation targets. Due to their substantial temporal and spatial aggregation, IAMs cannot explicitly represent all detailed challenges of integrating the variable renewable energies (VRE) wind and solar in power systems, but rather rely on parameterized modeling approaches. In the ADVANCE project, six international modeling teams have developed new approaches to improve the representation of power sector dynamics and VRE integration in IAMs. In this study, we qualitatively and quantitatively evaluate the last years' modeling progress and study the impact of VRE integration modeling on VRE deployment in IAM scenarios. For a comprehensive and transparent qualitative evaluation, we first develop a framework of 18 features of power sector dynamics and VRE integration. We then apply this framework to the newly-developed modeling approaches to derive a detailed map of strengths and limitations of the different approaches. For the quantitative evaluation, we compare the IAMs to the detailed hourly-resolution power sector model REMIX. We find that the new modeling approaches manage to represent a large number of features of the power sector, and the numerical results are in reasonable agreement with those derived from the detailed power sector model. Updating the power sector representation and the cost and resources of wind and solar substantially increased wind and solar shares across models: Under a carbon price of 30$/tCO2 in 2020 (increasing by 5% per year), the model-average cost-minimizing VRE share over the period 2050–2100 is 62% of electricity generation, 24%-points higher than with the old model version.

On the path to climate neutrality, global production and trade of basic materials might change due to the heterogeneous availability of renewable electricity. Here we estimate the “renewables pull”, i.e. the energy-cost savings associated with such relocation, for varying depths of relocation for three key tradable energy-intensive industrial commodities: steel, urea, and ethylene. Assuming an electricity-price difference of 40 EUR/MWh, we find respective relocation savings of 19%, 33%, and 38%, which might, despite soft factors in the private sector, lead to green relocation. Conserving today's production patterns by importing hydrogen is substantially costlier, whereas imports of intermediate products could be almost as cost-efficienct, while keeping substantial value creation in importing regions. A societal debate on macroeconomic, industrial, and geopolitical implications is needed, potentially resulting in selective policies of green-relocation protection.

Abstract. Integrated assessment models (IAMs) are a central tool for the quantitative analysis of climate change mitigation strategies. However, due to their global, cross-sectoral and centennial scope, IAMs cannot explicitly represent the temporal and spatial details required to properly analyze the key role of variable renewable energy (VRE) in decarbonizing the power sector and enabling emission reductions through end-use electrification. In contrast, power sector models (PSMs) can incorporate high spatiotemporal resolutions but tend to have narrower sectoral and geographic scopes and shorter time horizons. To overcome these limitations, here we present a novel methodology: an iterative and fully automated soft-coupling framework that combines the strengths of a long-term IAM and a detailed PSM. The key innovation is that the framework uses the market values of power generations and the capture prices of demand flexibilities in the PSM as price signals that change the capacity and power mix of the IAM. Hence, both models make endogenous investment decisions, leading to a joint solution. We apply the method to Germany in a proof-of-concept study using the IAM REgional Model of INvestments and Development (REMIND) v3.0.0 and the PSM Dispatch and Investment Evaluation Tool with Endogenous Renewables (DIETER) v1.0.2 and confirm the theoretical prediction of almost-full convergence in terms of both decision variables and (shadow) prices. At the end of the iterative process, the absolute model difference between the generation shares of any generator type for any year is < 5 % for a simple configuration (no storage, no flexible demand) under a “proof-of-concept” baseline scenario and 6 %–7 % for a more realistic and detailed configuration (with storage and flexible demand). For the simple configuration, we mathematically show that this coupling scheme corresponds uniquely to an iterative mapping of the Lagrangians of two power sector optimization problems of different time resolutions, which can lead to a comprehensive model convergence of both decision variables and (shadow) prices. The remaining differences in the two models can be explained by a slight mismatch between the standing capacities in the real world and optimal modeling solutions based purely on cost competition. Since our approach is based on fundamental economic principles, it is also applicable to other IAM–PSM pairs.

E-fuels promise to replace fossil fuels with renewable electricity without the demand-side transformations required for a direct electrification. However, e-fuels’ versatility is counterbalanced by their fragile climate effectiveness, high costs and uncertain availability. E-fuel mitigation costs are €800–1,200 per tCO2. Large-scale deployment could reduce costs to €20–270 per tCO2 until 2050, yet it is unlikely that e-fuels will become cheap and abundant early enough. Neglecting demand-side transformations threatens to lock in a fossil-fuel dependency if e-fuels fall short of expectations. Sensible climate policy supports e-fuel deployment while hedging against the risk of their unavailability at large scale. Policies should be guided by a ‘merit order of end uses’ that prioritizes hydrogen and e-fuels for sectors that are inaccessible to direct electrification. E-fuels—hydrocarbon fuels synthesized from green hydrogen—can replace fossil fuels. This Perspective highlights the opportunities and risks of e-fuels, and concludes that hydrogen and e-fuels should be prioritized for sectors inaccessible to direct electrification.

Abstract Ambitious policy targets together with current and projected high growth rates indicate that future power systems will likely show substantially increased generation from renewable energy sources. A large share will come from the variable renewable energy (VRE) sources wind and solar photovoltaics (PV); however, integrating wind and solar causes challenges for existing power systems. In this paper we analyze three major integration challenges related to the structural matching of demand with the supply of wind and solar power: low capacity credit, reduced utilization of dispatchable plants, and over-produced generation. Based on residual load duration curves we define corresponding challenge variables and estimate their dependence on region (US Indiana and Germany), penetration and mix of wind and solar generation. Results show that the impacts of increasing wind and solar shares can become substantial, and increase with penetration, independently of mix and region. Solar PV at low penetrations is much easier to integrate in many areas of the US than in Germany; however, some impacts (e.g. over-production) increase significantly with higher shares. For wind power, the impacts increase rather moderately and are fairly similar in US Indiana and Germany.

This climate change impact data (future scenarios on temperature-induced GDP losses) and climate change mitigation cost data (REMIND model scenarios) is published under doi: 10.5281/zenodo.3541809 and used in this paper: Ueckerdt F, Frieler K, Lange S, Wenz L, Luderer G, Levermann A (2018) The economically optimal warming limit of the planet. Earth System Dynamics. https://doi.org/10.5194/esd-10-741-2019 Below the individual file contents are explained. For further questions feel free to write to Falko Ueckerdt (ueckerdt@pik-potsdam.de). Climate change impact data File 1: Data_rel-GDPpercapita-changes_withCC_per-country_all-RCP_all-SSP_4GCM.csv Content: Data of relative change in absolute GDP/CAP levels (compared to the baseline path of the respective SSP in the SSP database) for each country, RCP (and a zero-emissions scenario), SSP and 4 GCMs (spanning a broad range of climate sensitivity). Negative (positive) values indicate losses (gains) due to climate change. For figure 1a of the paper, this data was aggregated for all countries. File 2: Data_rel-GDPpercapita-changes_withCC_per-country_all-SSP_4GCM_interpolated-for-REMIND-scenarios.csv Content: Data of relative change in absolute GDP/CAP levels (compared to the baseline path of the respective SSP in the SSP database) for each country, SSP and 4 GCMs (spanning a broad range of climate sensitivity). The RCP (and a zero-emissions scenario) are interpolated to the temperature pathways of the ten REMIND model scenarios used for climate change mitigation costs. Hereby the set of scenarios for climate impacts and climate change mitigation are consistent and can be combined to total costs of climate change (for a broad range of mitigation action). File 3: Data_rel-GDPpercapita-changes_withCC_per-country_SSP2_12GCM_interpolated-for-REMIND-scenarios.csv Content: Same as file 2, but only for the SSP2 (chosen default scenario for the study) and for all 12 GCMs. Data of relative change in absolute GDP/CAP levels (compared to the baseline path of the respective SSP in the SSP database) for each country, SSP-2 and 12 GCMs (spanning a broad range of climate sensitivity). The RCP (and a zero-emissions scenario) are interpolated to the temperature pathways of the ten REMIND model scenarios used for climate change mitigation costs. Hereby the set of scenarios for climate impacts and climate change mitigation are consistent and can be combined to total costs of climate change (for a broad range of mitigation action). In addition, reference GDP and population data (without climate change) for each country until 2100 was downloaded from the SSP database, release Version 1.0 (March 2013, https://tntcat.iiasa.ac.at/SspDb/, last accessed 15Nov 2019). Climate change mitigation cost data The scenario design and runs used in this paper have first been conducted in [1] and later also used in [2]. File 4: REMIND_scenario_results_economic_data.csv File 5: REMIND_scenarios_climate_data.csv Content: A broad range of climate change mitigation scenarios of the REMIND model. File 4 contains the economic data of e.g. GDP and macro-economic consumption for each of the countries and world regions, as well as GHG emissions from various economic sectors. File 5 contains the global climate-related data, e.g. forcing, concentration, temperature. In the scenario description “FFrunxxx” (column 2), the code “xxx” specifies the scenario as follows. See [1] for a detailed discussion of the scenarios. The first dimension specifies the climate policy regime (delayed action, baseline scenarios): 1xx: climate action from 2010 5xx: climate action from 2015 2xx climate action from 2020 (used in this study) 3xx climate action from 2030 4x1 weak policy baseline (before Paris agreement) The second dimension specifies the technology portfolio and assumptions: x1x Full technology portfolio (used in this study) x2x noCCS: unavailability of CCS x3x lowEI: lower energy intensity, with final energy demand per economic output decreasing faster than historically observed x4x NucPO: phase out of investments into nuclear energy x5x Limited SW: penetration of solar and wind power limited x6x Limited Bio: reduced bioenergy potential p.a. (100 EJ compared to 300 EJ in all other cases) x6x noBECCS: unavailability of CCS in combination with bioenergy The third dimension specifies the climate change mitigation ambition level, i.e. the height of a global CO2 tax in 2020 (which increases with 5% p.a.). xx1 0$/tCO2 (baseline) xx2 10$/tCO2 xx3 30$/tCO2 xx4 50$/tCO2 xx5 100$/tCO2 xx6 200$/tCO2 xx7 500$/tCO2 xx8 40$/tCO2 xx9 20$/tCO2 xx0 5$/tCO2 For figure 1b of the paper, this data was aggregated for all countries and regions. Relative changes of GDP are calculated relative to the baseline (4x1 with zero carbon price). [1] Luderer, G., Pietzcker, R. C., Bertram, C., Kriegler, E., Meinshausen, M. and Edenhofer, O.: Economic mitigation challenges: how further delay closes the door for achieving climate targets, Environmental Research Letters, 8(3), 034033, doi:10.1088/1748-9326/8/3/034033, 2013a. [2] Rogelj, J., Luderer, G., Pietzcker, R. C., Kriegler, E., Schaeffer, M., Krey, V. and Riahi, K.: Energy system transformations for limiting end-of-century warming to below 1.5 °C, Nature Climate Change, 5(6), 519–527, doi:10.1038/nclimate2572, 2015.