DNV GL: Electrifying the Future

A BROADER VIEW

SAFER, SMARTER, GREENER

ELECTRIFYING THE FUTURE

Authors Global electrification outlook 2050 Electrifying the future Theo Bosma, Jaap Bunschoten

Visions for a European energy policy Japan's energy trilemma Christian Hewicker, Michael Ebert, Eva Benz, Alexandre Jorge

The third generation of wind power Johan Sandberg, Gerben Dekker, Johan Slätte

Living the future today Paul Raats, Frits Bliek, Frits Verheij, Irin Bouwman

This initiative is a collaboration between DNV GL and Xyntéo, an advisory firm that works with global companies on projects that enable businesses to grow in a new way, fit for the climate, resource and demographic realities of the 21st century. www.xynteo.com

Suggested reference: DNV GL: Electrifying The Future, Høvik, 2014.

Photography and illustrations: iStock, DNV GL, Joshua Bauer, NREL, Enexis

ACKNOWLEDGEMENTS

Foreword from Henrik O. Madsen . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

A broader view . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Executive summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10VISIONS FOR A EUROPEAN ENERGY POLICY ..........................................................................16Vision 1: Large-scale wind power ....................................................................................................... 22 Vision 2: The solar revolution .............................................................................................................. 24 Vision 3: Putting source close to demand.......................................................................................... 26

THE THIRD GENERATION OF WIND POWER ............................................................................282010-2020 Demonstrating the technology ....................................................................................... 32 2020-2030 Cost compression ............................................................................................................. 34 2030-2050 Large-scale power production ........................................................................................ 40

LIVING THE FUTURE TODAY .......................................................................................................44What is smart about smart grids? ....................................................................................................... 46 Lessons learned from PowerMatching City ........................................................................................ 56

JAPAN'S ENERGY TRILEMMA .....................................................................................................60Potential pathways for Japan's future energy supply ....................................................................... 64

ELECTRIFICATION INSIGHTS ...................................................................................................... 70References ............................................................................................................................................ 82

One hundred and fifty years ago, the world was in the midst of a profound transition.

New technologies such as steam power, electricity and the telegraph led to an explosion

in productivity and connectivity, reshaping the global economy in just a few short

decades. Yet these shifts also introduced new risks to life, property and the environment

and transformed the relationship between technology, business and society.

MANAGING RISK, BUILDING TRUST

It was this context into which Det Norske Veritas and Germanischer Lloyd were born. These companies, which have now merged into DNV GL, took on the role of verifying that vessels were seaworthy during a time when the convergence of new technology and business models caused an unacceptable number of ship accidents. By managing the increasingly complex risks associated with the rapidly evolving maritime sector, classification societies built trust among shipping stakeholders, contributing to the birth of a new era in international trade.

Today, as DNV GL celebrates our 150th anniversary and our first year as a united company, the world is at another inflection point. The technologies, systems and institutions that have driven the most prolonged period of growth in our civilisation’s history are being tested by the new demands of the 21st century. And once again, our ability to manage risk and build trust will help us enable the changes the world needs.

In order to rise to this challenge, we have been exploring six themes of strategic relevance to our new organisation. Some of the themes, such as climate change adaptation, have taken us into newer territory; others, such as the future of shipping, have seen us re-evaluate more familiar ground. I believe that all of them, however, are absolutely central to our efforts to empower our customers and society to become safer, smarter and greener.

I hope that we can use the themes’ findings, as well as the momentum of 2014, to engage a wide range of stakeholders in a forward-leaning discussion about how to achieve our vision – global impact for a safe and sustainable future.

I look forward to the journey ahead.

Henrik O. Madsen President and CEO, DNV GL Group

DNV GL’S PAST, PRESENT AND FUTURE

4 ELECTRIFYING THE FUTURE

One hundred and fifty years ago, the world was in the midst of a profound transition.

New technologies such as steam power, electricity and the telegraph led to an explosion

in productivity and connectivity, reshaping the global economy in just a few short

decades. Yet these shifts also introduced new risks to life, property and the environment

and transformed the relationship between technology, business and society.

MANAGING RISK, BUILDING TRUST

It was this context into which Det Norske Veritas and Germanischer Lloyd were born. These companies, which have now merged into DNV GL, took on the role of verifying that vessels were seaworthy during a time when the convergence of new technology and business models caused an unacceptable number of ship accidents. By managing the increasingly complex risks associated with the rapidly evolving maritime sector, classification societies built trust among shipping stakeholders, contributing to the birth of a new era in international trade.

Today, as DNV GL celebrates our 150th anniversary and our first year as a united company, the world is at another inflection point. The technologies, systems and institutions that have driven the most prolonged period of growth in our civilisation’s history are being tested by the new demands of the 21st century. And once again, our ability to manage risk and build trust will help us enable the changes the world needs.

In order to rise to this challenge, we have been exploring six themes of strategic relevance to our new organisation. Some of the themes, such as climate change adaptation, have taken us into newer territory; others, such as the future of shipping, have seen us re-evaluate more familiar ground. I believe that all of them, however, are absolutely central to our efforts to empower our customers and society to become safer, smarter and greener.

I hope that we can use the themes’ findings, as well as the momentum of 2014, to engage a wide range of stakeholders in a forward-leaning discussion about how to achieve our vision – global impact for a safe and sustainable future.

I look forward to the journey ahead.

Henrik O. Madsen President and CEO, DNV GL Group

DNV GL’S PAST, PRESENT AND FUTURE

5

The Arctic offers a preview of a new paradigm for business: harsher environments, higher public scrutiny and a greater need to engage with stakeholders. As industries enter the Arctic, understanding, communicating and managing risks will be essential both to earning social licence to operate and minimising the impacts of their activities. With such high stakes, the Arctic will be a defining frontier – not just of operations, but of safer, smarter, greener technologies and standards. The Arctic is rich with resources and dilemmas. And while there are no easy answers to these dilemmas, we must tackle questions about its development step by step, based on a common understanding of the risks. In this theme, we examine the complex Arctic risk picture and explore its implications for shipping, oil and gas, and oil spill response.

ARCTIC: THE NEXT RISK FRONTIER

ADAPTATION TO A CHANGING CLIMATEClimate change mitigation remains essential for our work to build a safe and sustainable future. But the greenhouse gases that have accumulated in the atmosphere over the past century and a half have already set changes in motion. Infrastructure and communities around the world urgently need to adapt to a climate characterised by more frequent and more severe storms, droughts and floods. And given the interdependence between business and society, business has a strong interest and critical role to play in these efforts. In this theme we have been developing tools to help both businesses and communities adapt to this new risk reality: a web-based platform for sharing information and best practices; a risk-based framework to help decision-makers prioritise their adaptation investments; and a new protocol to equip leaders to measure and manage community resilience to climate change.

As DNV GL turns 150, we are exploring six ‘themes for the future’ – areas where we can leverage our history and expertise to translate our vision into impact. We selected these themes as part of our efforts to take a broader view of the relationship between technology, business and society. On these pages you will find short introductions to each theme. To find out more, join us at: dnvgl.com/vision-to-impact

A BROADER VIEW Shipping is the lifeblood of our economy and the lowest-carbon mode of transport available to a world with ever-rising consumption. It therefore has a crucial part to play in a safe and sustainable future. But the industry faces a challenging climate: more intense public scrutiny of safety and security, tightening restrictions on environmental impacts and a revolution in digital technology. To meet these challenges, we have analysed six technology pathways that can help us achieve three ambitions for 2050: reduce the sector’s fatality rates 90 per cent and reduce fleet-wide CO2 emissions 60 per cent, all without increasing the costs of shipping.

THE FUTURE OF SHIPPING

Electricity has already revolutionised the way we power our operations, fuel our vehicles, and light and heat our buildings - and it will have an even bigger role to play in the decades to come. Many emerging technologies can provide cleaner, smarter, affordable and reliable energy. Floating offshore wind can provide emissions-free power at scale by 2050. And a suite of smart grid technologies will provide households and communities with leaner, more local power. In this theme, we take a closer look at these technologies, and examine the contributions they can make to providing low-carbon power to future generations.


The future is not what it used to be. Rising global temperatures, diminishing natural resources and deepening inequality threaten everyone’s prospects, including those yet to be born. Yet alongside these new global challenges are new innovations, solutions and opportunities that make a safe and sustainable future possible: a world where nine billion people can thrive while living within the environmental limits of the planet. In this theme, we set a vision towards this future. We analyse the barriers to change and detail the concrete actions that governments, business and civil society must take together if the obstacles are to be overcome and the opportunities for safer, smarter and greener growth are to be seized.

Technology has always been an enabler of societal change and we can expect that it will play a pivotal role in our transition to a safe and sustainable future. Indeed, existing technology is already unlocking safer, smarter, greener solutions for powering our economy, transporting our goods, caring for our sick and feeding our growing population. But history shows that trans-formative technologies – from the automobile to the internet – can take decades to reach scale. And time is one resource we do not have. How can we accelerate the deployment and commercialisation of sustainable technologies while ensuring that they are introduced safely into society? In this theme, we investigate this question, analysing the barriers to technological uptake and providing insights from past and present technologies.

A SAFE AND SUSTAINABLE FUTURE

FROM TECHNOLOGY TO TRANSFORMATION

THEMES FOR THE FUTURE


The Arctic offers a preview of a new paradigm for business: harsher environments, higher public scrutiny and a greater need to engage with stakeholders. As industries enter the Arctic, understanding, communicating and managing risks will be essential both to earning social licence to operate and minimising the impacts of their activities. With such high stakes, the Arctic will be a defining frontier – not just of operations, but of safer, smarter, greener technologies and standards. The Arctic is rich with resources and dilemmas. And while there are no easy answers to these dilemmas, we must tackle questions about its development step by step, based on a common understanding of the risks. In this theme, we examine the complex Arctic risk picture and explore its implications for shipping, oil and gas, and oil spill response.

ARCTIC: THE NEXT RISK FRONTIER

ADAPTATION TO A CHANGING CLIMATEClimate change mitigation remains essential for our work to build a safe and sustainable future. But the greenhouse gases that have accumulated in the atmosphere over the past century and a half have already set changes in motion. Infrastructure and communities around the world urgently need to adapt to a climate characterised by more frequent and more severe storms, droughts and floods. And given the interdependence between business and society, business has a strong interest and critical role to play in these efforts. In this theme we have been developing tools to help both businesses and communities adapt to this new risk reality: a web-based platform for sharing information and best practices; a risk-based framework to help decision-makers prioritise their adaptation investments; and a new protocol to equip leaders to measure and manage community resilience to climate change.

As DNV GL turns 150, we are exploring six ‘themes for the future’ – areas where we can leverage our history and expertise to translate our vision into impact. We selected these themes as part of our efforts to take a broader view of the relationship between technology, business and society. On these pages you will find short introductions to each theme. To find out more, join us at: dnvgl.com/vision-to-impact

A BROADER VIEW Shipping is the lifeblood of our economy and the lowest-carbon mode of transport available to a world with ever-rising consumption. It therefore has a crucial part to play in a safe and sustainable future. But the industry faces a challenging climate: more intense public scrutiny of safety and security, tightening restrictions on environmental impacts and a revolution in digital technology. To meet these challenges, we have analysed six technology pathways that can help us achieve three ambitions for 2050: reduce the sector’s fatality rates 90 per cent and reduce fleet-wide CO2 emissions 60 per cent, all without increasing the costs of shipping.

THE FUTURE OF SHIPPING

Electricity has already revolutionised the way we power our operations, fuel our vehicles, and light and heat our buildings - and it will have an even bigger role to play in the decades to come. Many emerging technologies can provide cleaner, smarter, affordable and reliable energy. Floating offshore wind can provide emissions-free power at scale by 2050. And a suite of smart grid technologies will provide households and communities with leaner, more local power. In this theme, we take a closer look at these technologies, and examine the contributions they can make to providing low-carbon power to future generations.


The future is not what it used to be. Rising global temperatures, diminishing natural resources and deepening inequality threaten everyone’s prospects, including those yet to be born. Yet alongside these new global challenges are new innovations, solutions and opportunities that make a safe and sustainable future possible: a world where nine billion people can thrive while living within the environmental limits of the planet. In this theme, we set a vision towards this future. We analyse the barriers to change and detail the concrete actions that governments, business and civil society must take together if the obstacles are to be overcome and the opportunities for safer, smarter and greener growth are to be seized.

Technology has always been an enabler of societal change and we can expect that it will play a pivotal role in our transition to a safe and sustainable future. Indeed, existing technology is already unlocking safer, smarter, greener solutions for powering our economy, transporting our goods, caring for our sick and feeding our growing population. But history shows that trans-formative technologies – from the automobile to the internet – can take decades to reach scale. And time is one resource we do not have. How can we accelerate the deployment and commercialisation of sustainable technologies while ensuring that they are introduced safely into society? In this theme, we investigate this question, analysing the barriers to technological uptake and providing insights from past and present technologies.

A SAFE AND SUSTAINABLE FUTURE

FROM TECHNOLOGY TO TRANSFORMATION

THEMES FOR THE FUTURE

7

EXECUTIVE SUMMARYServing the world's growing electricity needs while reducing greenhouse gas emissions is no fairy tale. This can be the new reality when we develop and enable power generation by a balanced mix of renewable energy sources.

In our daily life we rely on electricity for many of our activities. We simply expect electricity to be available. But, is it necessary to use fossil fuel-fired power plants, or can we look for alternatives? Do we need the current level of electricity consumption to maintain our comfort level? Or, can we increase efficiency by replacing inefficient equipment and better insulation of our buildings? Do we still need to drive cars with combustion engines or are there alternatives in electric transportation? Can we turn ourselves into producers of electricity?

These are just a few of the questions that might be asked, given the statement that emissions can be reduced by greater use of electricity. This report will give an outlook into the possibilities of different renewable energy sources (RES) portfolios and take a deep dive into floating offshore wind and smart grids.

For Europe we have developed scenarios where we evaluate the theme of a centralised versus a de-centralised energy infrastructure. In the different visions we discuss the consequences of the balance between wind, solar, grid and backup power. We will also offer some insight into Japan's energy 'trilemma'. After the Fukushima nuclear power plant disaster and the resulting shortfall in energy supply, the government faces apparently unsolvable challenges in energy. But there are options for a safer, smarter, greener society with and without nuclear power as the backbone of the transition.

Today, many initiatives are rushing to develop renewable energy sources. Not only wind and solar solutions, but also geothermal, wave, tidal, and hydro power. In this report we highlight one of these new developments: floating offshore wind energy. Why? Much of world's coastlines are steep, and thus not suitable for bottom-fixed wind turbines. Also, many large cities are located close to deep sea. In Japan, that includes cities like Tokyo, Osaka, Yokohama, and Sapporo.

In our smart grid highlight, we demonstrate that part of the future as described in one of the European scenarios is already reality. In PowerMatching City in the Netherlands 40 households are participating in the world's first complete smart grid, fully equipped with smart meters, smart appliances, renewable energy sources and access to the market to trade electricity. This community lives the future, uses the grid as exchange platform, with only a minor impact on their personal lifestyle.

Why do we highlight the years 2030 and 2050? We have just 15 years before reaching 2030. If we want to develop smart appliances, install renewable energy sources and adapt legislation, 15 years is not that long. In other words, we have to act now. The 20 years from 2030 to 2050 is the period needed to implement all initiatives and realise the cumulative effect of an electrified society.


INTRODUCTIONGLOBAL ENERGY OUTLOOK 2050


Since the industrial revolution, technological breakthroughs have changed the way we live. At the same time, we have become dependent on fossil fuels for energy. Modern energy services are a prerequisite for economic development and human well-being. Modern energy services are crucial to human well-being and to a country's economic development. All pathways, especially those with higher renewable energy shares, require a shift in legislation, planning, and operation of the energy sector.

INTRODUCTION 11

CONSUMPTION

PRODUCTION

MWh

MV

GWh

HV

TWh

UHV

Since the industrial revolution, technological breakthroughs have changed the way we live, but we have become increasingly dependent on fossil fuels for energy. Our challenge now is to find a way to maintain or improve our standard of living while curbing the polluting effects of high energy consumption.

Energy is the driver for so much of modern life: energy services are crucial to human well-being and to every country's economic development. Developed countries tend to focus on domestic energy security or decarbonising their energy mix, while the task for developing countries is to open up access to affordable and reliable energy supply, in

order to help reduce poverty, improve health and increase economic productivity1.

Exploring, developing and enabling sustainable power generation through a balanced mix of renewable energy sources will help increase efficiency and reduce greenhouse gas emissions across all industries.

The task is enormous, but achievable. Globally over 1.3 billion people have no access to electricity, but attaining universal access by 2030 would initially increase global electricity generation by just 2.5 per cent2.


In its New Policies scenarios, the International Energy Agency (IEA) estimates that from 2010 to 2030, around USD 275 billion of investment will be spent on providing access to electricity. This represents an annual investment of USD 13 billion (on average) to connect around 26 million people per year. In IEA's 'Energy for All' case, the additional investment required to achieve universal access to electricity is estimated to be around USD 640 billion.

Historically, the use of electricity has continuously expanded, from light bulb to electric motors, from industrial production to facilities, electronic devices, household equipment and the internet. That process is likely to continue, with electrification applied to transport, industrial processing, and construction, including heating and cooling systems.In the coming years, the evolution is set to expand to customers themselves. Consumers are likely to turn into producers as well: becoming so-called 'prosumers'.

The power sector can reach the ultimate goal of decarbonisation in different ways. There are low carbon technologies, carbon capture and storage (CCS) options, nuclear energy, biomass, hydro power and a range of wind and solar conversion technologies. Connecting to electricity can be realised by on-grid, mini-grid, and isolated off-grid solutions. All will need to incorporate resource availability and diversification according to specific geographies. Future electrification will rely on evolving technologies to cover greater areas and distances, which will reinforce globalisation trends.

This report explores different scenarios to reach this future. Based on their similar ambitions for a long-term low carbon future with energy security, this report has modelled future scenarios for Europe and Japan. It then describes the potential of floating wind

installations before examining smart grids that facilitate a de-centralised energy infrastructure. Finally it looks at future power infrastructure in Japan.

Analysing the future for Europe For Europe, we explore the scenario of a centralised versus de-centralised energy infrastructure and examine the balance between wind, solar, grid and backup power.

In the centralised scenario wind plays the dominant role. A pan-European super grid would transport large volumes of excess production from wind power at remote locations, complemented by investments into pumped hydro capacity in existing Norwegian hydropower plants. This combination substantially decreases loss of renewables-generated electricity.

In the de-centralised scenarios, solar plays the dominant role. Large-scale implementation of small and cheap solar photovoltaic (PV) modules on European buildings could create excessive energy supply and would need smart grid technologies and de-centralised electricity storage to avoid curtailment.

To ensure security of supply, considerable back-up electricity capacity, which can operate when wind and solar power are not available, needs to be in place. Such reserves should be provided by a suitable mix of demand response, energy storage and certain fossil-fired power plants, such as open cycle gas turbines, gas en ines and other technologies with limited capital costs and/or high operational flexibility.

Third generation of wind powerWind power has become an essential part of the world's energy mix. Global installed capacity is close to 300 gigawatt (GW)3. To speed up development of this renewable energy source large offshore wind farms should be developed. The technical offshore potential is enormous. For Japan, it could match current installed capacity.

Offshore wind projects face greater technological challenges than onshore wind technologies (due to issues such as higher wind speeds). In 2013, the global installed capacity for offshore wind was around 6.5 GW, comprised mostly of turbines attached to the seabed in a very few shallow water sites.

Demand for electricity will continue to grow: over 1.3 billion people currently have no access to electricity

INTRODUCTION 13

Around 95 per cent of the world's ocean coastlines are too deep for bottom-fixed turbines – including those seas closest to the urban areas that need new electricity supplies. However, floating turbines would open up much of this deep water to offshore wind farms.

For floating wind to become a reality, commercial floating offshore wind applications must be developed. One of the most promising early applications is water-injection, already used to increase oil production. Under the right conditions, integrating a floating wind turbine and water injection unit into an autonomous system could prove to be the most cost effective technology for progress.

To reduce the Levelised Cost of Electricity (LCOE) of floating offshore wind, the focus will be on serial production, turbine size, blade design and mooring systems. In this report we examine technologies which could lead to more large-scale floating wind turbine arrays by 2050.

Making grids smart Achieving more de-centralised renewable production will require solar-PV modules to be integrated onto residential, public and commercial buildings. The world installed capacity of solar-PV increased to over

100 GW in 2013. Expanding this towards the terawatt (TW) scale needs local balancing of supply and demand, through, for example, smart grid technologies and local storage.

The current transmission & distribution grids are designed for one-directional power flows from generator to end-user, not for bi-directional power flows. Transforming the grid need us to connect, engage and work differently with supply and demand. Grids will need to become bi-directional systems where energy consumers will become 'prosumers'. Their behaviour will have a major impact on the entire energy system. Smart grids will transform from present grids into modern integrated systems that meet the needs of everyone in the energy chain and which commoditise products, services, and solutions. Sensors and actuators will transform the system into an intelligent network, accompanied by an explosion of captured energy data.

This will require the development of guidelines, standardisation and needs us to minimise the time-to-market for new developments. The existence and success of a smart grid is based on fulfilling three basic market freedoms: connection to the grid, engagement in transactions, and taking from or feeding electricity into the grid at all times.


A 'smart grid' may seem like a futuristic, abstract concept, but this report will show that current technology can already combine all these key elements into an operational system. This system includes a local market for electricity exchange which is linked to the national market, smart meters and appliances throughout, renewable energy sources, home energy storage and electric transport.

In PowerMatching City in Groningen, the Netherlands, 40 households already live the future de-centralised scenario for Europe described in one of the visions of this report. Through smart agents, end-users buy their electricity at low rates and sell it at high rates, independent of the type of device. This creates flexibility without affecting end-users' home comfort and system efficiency. Smart energy systems, inter-connected and inter-operable, ensure an affordable, reliable, and sustainable energy supply, making the world a safer, smarter, greener place to live.

Japan's urgent need Finally the future power infrastructure in Japan is evaluated.

For Japan, our outlook has analysed the feasibility and impact of different development pathways. Five scenarios explore the use of nuclear and renewable

energies, the role of energy efficiency and different targets for carbon emissions.

Three of the scenarios are based on projects under discussion by the Ministry of Economy, Trade and Industry (METI) and are also used by the IEEJ4. The remaining two scenarios, as well as the development until 2050, have been calculated by DNV GL for this report.

After Fukushima nowhere in the world has the need to balance security of supply, affordable pricing and clean power generation been as pressing as it has there.

Electricity's share of the energy mix may double in the coming decades and technology already exists which can reduce our carbon footprint by 90 per cent

INTRODUCTION 15

VISIONS FOR A EUROPEAN ENERGY POLICY


The European Union (EU) is committed to reducing greenhouse gas emissions by at least 80 per cent below 1990 levels by 2050, where it is widely accepted that this will require an almost complete decarbonisation of the European power sector.

VISIONS 17

WHICH TYPESof renewable energy sources will Europe use?

The European Union (EU) is committed to reducing greenhouse gas emissions to 80 per cent below 1990 levels by 2050. It is widely accepted that this will require

an almost complete decarbonisation of the European power sector.

In the Energy Roadmap 2050, published in December 20115, the European Commission investigated various options for decarbonising the EU power sector, whilst ensuring security of energy supply and maintaining competitiveness. Practically all scenarios explored by the Roadmap show that even ambitious decarbonisation targets can be achieved by a diversified mix of low-carbon technologies, including carbon capture and storage (CCS) and nuclear energy, but require renewable energy sources to provide a much larger proportion of electric energy than they do today.

At the heart of the challenge facing European and national policy makers is an uncertainty about which renewable energy source (RES) will be the most economic and effective, and thus dominate power production in the long term.

One vision maintains that the future use of RES should follow resource availability, i.e. it should invest in installing wind power where the wind blows the strongest, or solar where there is most sunshine. An alternative vision says that Europe should build renewable energy capacity closer to demand centres.

In this chapter we explore this dilemma by analysing three alternate visions for harnessing renewable energy in Europe:

� Vision 1: Harnessing large-scale wind power in remote locations

� Vision 2: A solar revolution leading to massive use of small-scale installations.

� Vision 3: Installing RES close to European demand centres


Figure 1. Evolution of levelised cost of electricity (LCOE) for different RES technologiesSource: DNV GL

0

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2012 2020 2030 2040 2050

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VISIONS FOR EUROPE 19

In order to address the question where to build renewable energy capacity, DNV GL has analysed two scenarios with the same overall share6 but a different mix of renewable energy sources

� Large-scale wind power which relies primarily on large onshore and offshore wind farms and a regional concentration of production in Northwest Europe

� Solar revolution which assumes that solar-PV will become the most economic technology, leading to a massive use of small-scale installations especially in Southern Europe

The analysis in the Electrification Outlook confirms that future infrastructure requirements and operational challenges for the European power system strongly depend on the future development of renewable energy sources.

Both Vision 1 and 2 require a major expansion of European transmission grids, the need for additional transmission capacity is by far the highest in the Solar Revolution scenario. Similarly, the Solar Revolution leads to significant curtailment of production from solar power, mainly in Southern Europe, although the corresponding amounts can be greatly reduced by demand response and de-centralised electricity storage. Conversely, curtailment of RES is initially much lower in Large-scale Wind Power but cannot be reduced as easily.

As well as these differences, the analysis highlights some major challenges that all three scenarios will create for the future development of the European system. All scenarios will require major investments into generation, transmission and distribution, and additional generation capacity may be required to compensate for the loss of energy due to curtailment of RES.

Extending the existing grid may be an economic solution, but it may have strong visual and other impacts, for instance in densely populated areas or protected landscapes.

Against this background, the DNV GL Outlook has also taken a closer a look at three visions of possible solutions for these challenges.

LOOKING AT THE IMPACTof different visions


ESPT

IE

GB

BeNeLux

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IT

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BG & RO

AT,CZ,HR,HU,SI,SK

Nordic & Baltic States

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(GW)

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Solar PV

Solar CSP

FR

GR

Large Scale Wind Power

Solar Revolution

300

Figure 2. Regional distribution of wind and solar power capacity [in MW] in the two scenariosSource: DNV GL

The future of renewable energy sources is highly uncertain


LARGE-SCALE WIND POWERCombining a European supergrid with Norwegian hydro storage

Vision 1 addresses the specific challenges of harnessing large-scale wind power. A pan-European supergrid would serve to transport large volumes of excess production from wind power at remote locations (for instance in the North Sea or

the British islands) to consumers across Europe.

As indicated in Figure 3, the European supergrid consists of two parts. Firstly, an integrated offshore grid in the North Sea which connects a cluster of major wind farms to each other: Norway, the United Kingdom and continental Europe. Secondly, a number of major transport corridors on the continent, which are mainly based on the use of innovative (ultra-)high voltage direct current (U)HVDC technologies. These 'electricity highways' allow for an efficient transport of large volumes of electricity over long distances with a much-reduced visual and environmental impact.

The European supergrid is complemented by investments into pumped hydro capacity in existing Norwegian hydropower plants, allowing Norway to take the role of Europe's 'green battery'. The idea

behind this is simple. As renewable energy is not necessarily produced during those times when consumers need energy, Norwegian hydro reservoirs are used to efficiently store excess energy when the wind is blowing, and release it when the wind isn't blowing but electricity is still required required by European customers.

Our analysis shows that the combination of a pan-European supergrid and Norwegian storage capacities would decrease the curtailment of wind and solar power, allowing for a better exploitation of the available RES potential in Europe. This in turn helps to reduce the remaining fuel consumption of conventional generation technologies, as well as operational cost. In turn this yields a positive effect on the climate by lowering future CO2 emissions.

A pan-European supergrid and Norwegian pumped hydro storage capacity substantially decreases RES curtailment


Supergrid

Hydro WindBiomassSolar

Offshore grid

Figure 3. Structure of the pan-European supergrid using Norwegian hydropower plantsSource: DNV GL


Vision 2 facilitates the 'Solar Revolution' scenario, which is characterised by the large-scale installation of small and cheap solar photovoltaic (PV) modules on European homes as well as on public and commercial buildings.

Solar power can provide very cheap power and if there is a massive increase in use of PV modules on European buildings, as envisaged by this scenario, then available production will often exceed local consumption especially in Southern Europe.

This means that even with an ambitious expansion of local distribution networks and cross-border

transmission links, substantial volumes of solar-generated electric power will fail to be absorbed by the European system. Therefore Vision 2 also requires the widespread application of smart grid technologies to complement the massive rollout of solar-PV devices.

Instead of production following demand, these technologies help consumers to optimally adjust their demand to the variable production from RES. This flexibility is further promoted by the use of small-scale energy storage units, such as batteries, which, it is assumed, will have become an affordable and competitive option by 2050.

As illustrated in Figure 4 the use of smart grid technologies and de-centralised storage help to substantially reduce the need for curtailment of

Smart grid technologies and de-centralised electricity storage substantially decrease solar-PV curtailment

THE SOLAR REVOLUTIONDemocratising electricity supply with smart grids and battery storages


Figure 4. Reduced curtailment of solar-PV in Southern Spain due to smart grid technologies and de-centralised energy storage in a summer weekSource: DNV GL

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de-centralised PV installations, especially in Southern Europe where the biggest potential of solar-PV is located. This allows reduction of the residual use of fossil fuels and nuclear energy and hence operating costs and remaining CO2 emissions. Just as importantly, these measures also help to greatly reduce the need for new network infrastructure, both at the transmission and distribution level.

These changes not only improve economic efficiency, but also more generally promote the transition to a more 'democratic' power system, which is characterised by millions of small residential and commercial customers becoming 'prosumers' (producing consumers) avtively participating in the electricity market and making use of their own local production facilities.


PUTTING SOURCE CLOSE TO DEMANDInstalling renewable energy sources close to European load centres

Both of the visions presented above require major investments in infrastructure costs, with potentially major impacts on populated and protected areas. Vision 3 tries to resolve this dilemma by locating new RES capacity closer to demand centres rather than according to resource availability.

Vision 3 presents the use of a balanced mix of different renewable energies – including solar, onshore and offshore wind power – and suggests a more balanced regional distribution of RES across Europe based on putting supply close to where demand is greatest.

As illustrated in Figure 5 the application of a balanced RES portfolio and a de-centralised renewable energy supply system requires less additional transmission infrastructure to overcome potentially long distances between renewable production and electricity demand centres. While Vision 1 and 2 utilise innovative transmission concepts in combination with storage technologies. Vision 3 saves more than 50 per cent of new transmission capacity by producing electricity closer to where it is consumed. Essentially, a similar level of RES integration (or avoided curtailment) can be achieved in all three visions, without the need for large investments in new offshore and supergrid infrastructure in Vision 3.

A balanced mix of RES technologies and a high degree of regional distribution represent important means to facilitate the large-scale integration of RES. In combination with a pan-European grid, demand response and (de-centralized) storages this approach offers a promising solution for Europe to move towards an environmentally-friendly and low-carbon future electricity supply.

A balanced RES portfolio and a de-centralised renewable energy supply system require less new transmission capacity to transport electricity to European load centers


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Figure 5. Grid capacity requirements (top) and total curtailment of RES (bottom) across Vision 1, 2 and 3 for an European energy policySource: DNV GL


FLOATING WIND TURBINE TECHNOLOGYA POWER SOURCE FOR 2050


FLOATING WIND TURBINE TECHNOLOGYA POWER SOURCE FOR 2050

In 2013, the global installed capacity for offshore wind was around 6.5 GW, almost all of this built on bottom fixed foundations. However, in many areas of the world the waters are too deep for this technology. Here floating wind turbine technology offers a new and exciting opportunity to provide clean energy to countries and coastal regions with deep water coastlines.

FLOATING WIND TURBINE TECHNOLOGY 29

WIND POWER BUILT ON THE DEEP OCEANSAn energy source for the future

Floating wind turbines can be deployed in waters of several hundred of metres making the benefits of offshore wind power available to new areas and coastlines. Future developments may open up for the possibility of going towards the ultra-deep waters, in the 1,000 metres range and beyond. Consequently, floating offshore wind could be an important contributor to the world's energy mix in the future, with large floating wind farms providing clean, cost-effective electricity for millions of people.

In 2050 the global energy mix is likely to look rather different from today. Rising populations and economic growth in emerging markets will drive a considerable increase in overall demand for electricity and energy. While new generating capacity will be required, environmental and social

pressures are likely to change the types of generation technologies deployed. There is already a strong worldwide emphasis on decarbonising the energy sector and reducing the use of fossil fuels. Many countries are also planning to retreat from nuclear power.

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Figure 6. An overview of applied wind power generation substructure technologies


In DNV GL's vision for 2050, a possible roadmap for floating offshore wind technology from demonstration to large-scale production has been developed in three stages.

� Phase 1: the era of technology demonstrations and small-arrays

� Phase 2: the era of cost compression and technology development

� Phase 3: the era of established offshore power production

Future developments may open up for the possibility of going towards the ultra-deep waters, in the 1,000 metres range and beyond

Renewable generation will therefore play an increasingly important role in the global energy mix and although offshore wind farms may sometimes be located hundreds of kilometres away from the coast, they may still be closer to the load centres than many other onshore large-scale power generation technologies, renewable or conventional.

The case for floating wind powerWind power is an established and proven renewable energy technology. Offshore wind turbines offer a number of potential advantages over their onshore cousins. The wind is typically stronger away from land, allowing more electricity to be generated. Wind farms at sea also attract less public concern over their possible impact on the landscape. Furthermore, large population centres are often located close to the coast, making offshore generation sites particularly convenient.

In 2013, the global installed capacity for offshore wind was around 6.5 GW, almost all of this built on bottom fixed foundations. Such turbines are typically restricted to sites with a water depth of up to 50-60 metres while the overwhelming majority of the world's oceans are too deep for such bottom-fixed turbines. In addition, many of the world's megacities are located on steep coastlines with waters far to deep for these conventional foundations.

Floating wind turbines would make many of these deep water areas available for offshore wind power, bringing the benefits of environmentally friendly power generation to places where it was not possible before. Floating offshore wind has enormous technical potential in Japan, which recently closed down most of its nuclear power, and otherwise has to replace this lost production capacity with imported

fossil fuels. For Japan, it is in the same order of magnitude as the country's total installed power generation capacity.

Anchoring the futureFloating wind turbine -the third generation of wind power- is the most recent development in the relatively young offshore wind power business. Currently, only a handful of small demonstration projects are running, accounting for a total generation capacity of just a few megawatts (MW). However, attracted by its potential, governments, large technology developers and other stakeholders are increasingly interested in this technology. As a result, floating wind turbine technology has the potential to mature into a cost-efficient energy source in the coming decade, graduating from today's demonstration projects to large-scale arrays of several thousand MW.

There is still much development required before this vision becomes a reality. This includes cost compression, advances in technologies and materials as well as for ancillary technologies such as novel power storage options.


DEMONSTRATING THE TECHNOLOGY 2010-2020

The first phase, running up until 2020, will focus on defining and proving the feasibility of floating wind turbine technology. New turbine concepts will be developed and demonstration projects will provide the first steps towards small generating arrays comprising a handful of turbines. This in turn will spark further research and innovation, and provide insight into how to combine technologies and further optimize designs.

During this initial stage, development is likely to be concentrated around a small number of countries. The world's first floating wind turbine prototype was installed in 2009 near the Norwegian island of Karmøy7, and small-scale demonstrator arrays are now under development around the world. Japan8, Portugal9, and the United States10 also have prototypes installed and show very strong interest in this technology.

Even in this early phase, floating offshore wind could be a viable power production option for certain applications. These applications will also serve as a stepping stone in the technology development and prove that the technology is a credible and reliable technology to a wider audience.

Early applications: reservoir water injectionOne of the promising early applications is water-injection used to increase oil production, often called water flooding. In this application water is pumped into an oil reservoir some distance away from the production platform to increase the amount of crude oil that can be extracted from the oil field. Today, such systems are typically powered from a gas turbine on the platform. Floating wind opens up the possibility of combining the turbine and injection pump into a one autonomous system operated remotely from the platform.

Offshore water injection systems and floating wind power are well matched. Water flooding does typically not require a constant rate of injection, as


long as the total amount of water over time is sufficient. Shifting power generation from the platform to the injection site eliminates the need for long power cables and frees up valuable space on the production platform.

As such, under the right conditions, integrating a floating wind turbine and a water injection unit into an autonomous system could prove to be the most cost-effective technology for reservoir water flooding. Our studies suggest that these systems could be the most cost-effective solution for many injection wells, particularly for marginal fields. Floating wind turbines could also offer flexibility with regards to new wells, moving from a depleted reservoir to new sites. The design life of an offshore turbine is normally 20-25 years, often longer than that of an injection well. Furthermore, water treatment technology currently under development should soon be available for integration into the system, substantially increasing the market for this application.

The Ekofisk field, the oil field that started the Norwegian oil adventure, is an excellent example of the increased recovery factors that can be obtained

from water injection. Originally estimated to be between 15-19 per cent, the recovery factor is now around 49 per cent11. The vast majority of today's offshore platforms use open cycle gas turbines for power generation and driving compressors and pumps. Replacing the gas turbines with floating wind turbines and electricity storage will reduce CO2 and NOx emissions by up to 80 per cent. Floating wind turbine technology can provide a mean to cost efficiently maximize the recovery factors for more reservoirs at larger distances from the platform facilities. The new technologies could offer the oil & gas industry an opportunity to develop more autonomous subsea water injection systems, avoiding a long power cable from the platform, reducing the need for power from gas turbines and thereby also reducing fuel costs and emissions from the operations.

Maturing into a commercial technologyReservoir water injection is a case where floating turbine technology could already now be the most cost effective solution. Costs will vary considerably on a case-by-case basis, but high-level economic indicators based on a few key components indicate that power generation from floating wind turbines can provide an economically viable alternative at a step-out distance of between 20-30 kilometres. Once proved, it would open up a demand driven purely by commercial aspects, and could reduce the time required to mature floating wind into a commercially available technology.

Moreover, seeing the oil & gas industry use floating wind turbines would send an important message that this technology offers a real, reliable, and economically feasible alternative to the power sources now used offshore.

Replacing the offshore gas turbines with floating wind turbines and electricity storage will reduce CO2 and NOx emissions by up to 80 per cent


COST COMPRESSION2020-2030

Once the feasibility of floating wind turbine technology has been proven in demonstration projects and small-scale applications, the focus will shift to reducing costs and scaling up the size of installations.

During this phase technological breakthroughs and improved manufacturing and installation processes will reduce costs, making floating wind economically viable for more applications, which will lead to a cycle of new installations, technology developments and cost reductions. This development will likely follow the cost compression pattern experienced in most mechanical industries including the onshore wind industry.

Cost compressionThe cost of floating wind turbine technology will to a large extent depend on the cost development of fixed offshore wind; hence a cost analysis will have to include both. Lean manufacturing of substructures, development of turbines, blades and station-keeping systems are all obvious elements of the future cost

reductions for offshore wind technology. A Levelised Cost of Energy (LCOE) model based on learning effects and projections of future market size can then assist in explaining the overall potential for cost compressions for the whole offshore wind industry. However, very few predictions exist for the offshore wind energy development until 2050 and few national targets look this far into the future.

Based on analysis and a number of industry reports, DNV GL established a low, high and base case scenario for the offshore wind cumulative installed capacity (for bottom-fixed and floating combined) up until the year 2050, as illustrated in Figure 7.

It is noted that DNV GL's high scenario is more conservative than some predictions. However, the


estimates provide an indication of the potential for cost reductions when combined with learning effects experienced by comparable industries.

The concept of learning effects is based on the empirical observation that the cost of technology fall by a constant proportion with every doubling of cumulative production. For these long-term predictions a learning curve approach has been judged more feasible methodology than a bottom-up approach. It covers positive effects gained through both technology developments as well as economies of scale throughout the project life cycle with CAPEX, OPEX and decommissioning costs. Other industry studies have estimated offshore wind learning effects between 9 and 15 per cent, with the lower estimates considered as conservative. DNV GL have for the cost of energy analyses up until 2050 used a learning rate effect between 7 and 14 per cent, using 10 per cent as a base case.

Using a value of EUR 165 per megawatt hour (MWh) as representative for offshore wind today (for bottom-fixed wind turbines) as a starting point, and by applying the learning rates (7 per cent, 10 per

cent and 14 per cent) to the offshore wind cumulative capacity estimates, ranges in LCOE as illustrated by Figure 8 are obtained.

As previously mentioned, no explicit separation has been made between the bottom-fixed and floating wind turbine technologies in the above. It can however be anticipated that the learning rate for floating wind turbines could be somewhat higher than for their bottom-fixed peers, as the identical structures may be mass produced in an automated manufacturing process and a simplified installation process with tug boats instead of jack-up vessels should also reduce risk and costs. In addition, the ability to do heavy maintenance inshore and to place the turbines at sites with the strongest possible winds instead of being restricted to sites with shallow water should also increase yield and reduce the cost of energy further.

There are inherent challenges in estimating what portion of the future offshore wind industry will be bottom-fixed and what will be based on floating technology. Even though costs of EUR 165 per MWh is not representative for the floating wind turbine


concepts of today, the costs for this technology is expected to fall quickly and be comparable to its bottom fixed peers within a few years. Based on this, DNV GL expects that the floating wind cost compression curve will be in the higher range of learning rate, i.e. between 10-14 per cent, as illustrated in Figure 8.

Technology enablersAll stakeholders within the offshore wind industry will need to work together to identify the enablers, barriers and future trends to be addressed. However, it is already possible to predict certain areas of development that can be expected to play an important role in enabling cost compression.

Today, offshore wind turbines are derived designs from onshore wind turbines with marine environment adaptions. The three bladed upwind horizontal axis

wind turbine is the most successful commercially deployed system and is expected to dominate the industry also in the coming years even though interesting developments of downwind turbines, two-bladed systems and vertical axis systems are ongoing. Once proven in demonstration and commercial projects, it is likely that a greater variety of turbine designs will be observed in the future.

Rated power, rotor size and blade designThe trend is towards increases in turbine rated power and rotor size, leading to a higher energy yield and improvement in LCOE. Turbines installed offshore during 2013 had an average size of 4 MW12 and demonstration projects for floating wind turbine systems currently under development are applying turbine sizes of 6-7 MW. Based on this, DNV GL believes that the average turbine size is bound to increase in the coming decades.

Figure 7. Offshore wind cumulative capacity estimate.

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Figure 8. Ranges in LCOE as function of cumulative capacity and learning rates

By the end of this decade, around 2020, it is assumed that the average size of a newly installed offshore wind turbine will be about 6 MW. Some developers have projected that 10 MW offshore turbines, with a hub height of 130 metres and a rotor diameter of 200 metres, will be commercially available in the early 2020s.

In 2030, the average wind turbine capacity of new installed turbines is approximated to be around 10 MW.

During the time period 2030-2050, wind turbine average size could grow further, with typical turbine size ranging between 10 MW and 15 MW, and possibly even up to 20 MW for new installations in the later part of the period.

New and improved processes for manufacturing and design, allowing for aerodynamic optimization and improvements in use of material, could have a considerable effect on blade performance and cost. Future designs will enable more flexible blades that can better adapt to a range of wind conditions and new motion control systems will help reduce fatigue and failure while also optimising power output.

Substructure technology, station-keeping and anchoringThe number of developers and substructure concepts is constantly growing. Even though alternative designs are suggested, the industry is currently dominated by the three key design philosophies: SPAR, Semi-Submersibles and Tension Leg Platforms (TLPs), all well-known from the offshore oil & gas industry.

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Figure 9. Ultra-deep water mooring solutions

Future developments in substructure design are closely correlated to the development in wind turbine design. The effect on the substructure design from increasing turbine sizes vary by concepts and consequently also the cost developments from these changes.

Introduction of new materials like polyester, graphene, and carbon fibres for mooring lines and tendon systems are likely to be used more in future applications. With larger arrays of turbines the potential for sharing anchor points will become an attractive mooring solution. Costs could potentially be significantly reduced from limiting the number of anchor points. Instead of having three (or more) anchors per turbine a shared anchor point would reduce the amount of anchors to one or two per turbine. However, detailed engineering assessments are required as the load pattern will change drastically. In the longer perspective an array where up to six turbines could share an anchor point could also be a solution, reducing the number of anchors further. Going into increasingly deeper waters, a

future solution that has been looked into is to connect the floating wind turbines to buoyancy elements that are connected to the seabed, as illustrated in Figure 9. This is however considered a solution for a more distant future, most likely beyond 2040.

Operation and maintenanceThere are several factors that will drive down the costs of operations and maintenance. First of all the increased size of turbines will reduce the amount of units per installed MW, so going from the current 6-7 MW size to 15 MW turbines would halve the amount of turbines in a field of similar capacity. Furthermore, introduction of technology with fewer rotating parts and optimised blades built with new materials and improved control system algorithms have the potential to further reduce need and associated costs for operation and maintenance (O&M).

Improved accessibility to the turbine structures, e.g. through development of less weather sensitive service vessels and efficient access systems such as


Figure 10. High-efficiency onshore production of substructures and wind turbines

compensated gangways, will not only give a lower direct cost for operation and maintenance, but also increase the wind farm availability, increasing the income and reducing cost of energy. The current average turbine availability offshore is about 90 per cent. A 50 per cent increase in turbine accessibility could increase this number to 94 per cent according to a study by the Carbon Trust.

Another likely future development is to have more remote operation and maintenance of offshore turbines. Remote inspection could be performed via a small robot equipped with a camera, various probes, heat sensitive devices and microphones. Some maintenance work could potentially be performed by robotised actions from a remote location and condition monitoring can allow maintenance work to be planned and avoid downtime when environmental conditions make access more difficult. The main contributions to reduced O&M costs are expected to come from increased use of more reliable components.

In the longer term, the offshore wind industry should become integrated with other associated industries such as fishing and aquaculture and thereby share resources and assets that will further reduce O&M costs.

In parallel, various complementary technologies will help delivering a reliable and predictable energy supply. Offshore power transmission technology with high-voltage DC and AC grid infrastructure will become more standardised. Also energy storage technology will see significant developments during this time.

Offshore transmission gridsThe cost of the electrical equipment is related to inter-array cables, export cables and offshore substations. The distance between turbines, water depth and distance to shore will also drive the cost of the electrical system. As the high-voltage direct current market matures, the costs related to grid connection cables are likely to be further reduced.


LARGE-SCALE POWER PRODUCTION2030-2050

We believe that wide-scale deployment of cost-competitive large arrays of floating wind turbines is a realistic scenario in the period 2030- 2050 in many parts of the world

As costs come down and technology develops, the scale and deployment of floating wind will increase. As a result, we believe that wide proliferation of large-scale arrays of floating wind turbines is realistic by 2030-2050

The floating wind arrays of this era could be vast. Floating technology could be cost-competitive with conventional power sources if there is sufficient political ambition and reseachers, technology developers and investors work together. By combining floating wind with new energy storage technologies, other renewable energy sources, and implementation of smart grids it will be possible for countries to almost or sometimes fully rely on renewable power generation systems.


Power prices are normally very high for isolated islands orarchipelagos. By this phase, offshore and other renewable technologies could make such places self-sufficient. A small archipelago with heterogeneous power demand consisting of some industry activities and residential loads could use a medium-sized array of around 50 offshore wind turbines, plus solar cells and energy storage to become self-sufficient zero-carbon. In this scenario, the wind turbines would provide the bulk of the energy production to meet the community's basic electricity needs. Solar panels would supply during the peak demand hours during the day, when power-hungry systems like air-conditioning are most used. Energy storage and micro smart grids will enable the security of supply and control of the power quality.

Technology challengesScaling up from medium-sized to large-scale floating arrays will also bring challenges. Further evolution in turbine design will result in very long and flexible blades. By 2050, blades could be well over 100

metres long and there could be even blades that change their shape according to wind conditions and power demand, expanding and contracting like boat sails to optimise power output and reduce fatigue loads.

New material and mooring system developments could also make it possible to place turbines in ultra-deep waters of around 1,000 metres. The main challenges for deep water moorings are related to the weight of the system and increased mooring line dynamics. A future development could be to connect the floating offshore wind turbine to a buoyancy element located at appropriate water depths. Such concepts will require new materials that are extremely strong and light. One of the most promising candidates is graphene, which has great potential. Graphene is an ultra-tough, ultra-thin form carbon. Application of graphene in offshore design is likely to be developed in other industries such as aerospace, and oil & gas, but the offshore wind industry will also benefit from this development.


Creating flexibilityA crucial element to enable the integration of large quantities of such intermittent resources resides within the ability of the electricity system to seamlessly absorb fluctuations. As the balance between generation and consumption needs to be maintained, flexibility is required. This can be done by adapting conventional/controllable generation assets and by control of demand. Energy Storage systems can also create flexibility, both large scale, like Pumped Hydro, Compressed Air, and small-scale within the distribution grid, where a large number of

smaller units can achieve the same impact. Also alternative concepts have been looked at for the integration of "flexibility" at offshore generation resources, such as pressurised water stored on the seabed. During windy periods, excess power from the turbines is used to pump water into membranes, which would be covered with a heavy weight of sand and rocks. Once power is required, the pressurised water is released through a hydroelectric turbine. Which flexibility solution to choose, will depend on local cost benefit analysis.

Figure 11. Example of an offshore local energy storage solution

Figure 12. Ocean depths around Japan


Large offshore wind farms can be protected marine areas combined with artificial reefs, creating marine ecosystems promoting numbers and diversity of fish populations

HVDC is mainly used for point-to-point power transmission. There are several of three-terminal HVDC schemes where three AC/DC line-communicated converter (LCC) stations are connected to the same DC line while injecting or extracting power from it. Applying voltage sources converters (VSC) in multi-terminal HVDC grids will make it possible to feed-in power from different offshore wind farms into one HVDC supply cable realising considerable cost savings on power cables.

Environmental issuesAlthough offshore wind does not suffer from the same concerns over landscape use as land-based wind farms, the fishing industry has questioned the impact such large-scale arrays will have on their activities. DNV GL and the offshore wind sector are working together with the fishing industry to integrate offshore wind, aquaculture, and sustainable fishing practices.

Experience from other deep sea installations suggests that large steel structures could actually function as artificial reefs, marine new ecosystems that promote numbers and diversity of fish populations. Industrial-scale trawling will not be possible in the vicinity of wind farms, but more

sustainable fixed-gear methods can be used as well as controlled aquaculture. The floating wind turbines can form the basis of a sustainable management system of marine life and energy resources.

Global powerWith the right political and technological support, floating offshore wind could to become a vital element of the global energy mix in the period 2030-2050. It will be possible to build turbine arrays along the coastlines like the North Atlantic, the Mediterranean, Southeast Asia, and the American Pacific coast. Such arrays could be built beyond the land horizon and still be cost-effective alternative to conventional energy sources.

Predictions state that the Asia-Pacific region will undergo phenomenal economic growth and a continued increase in demand for new energy infrastructure between now and 2050. Floating wind has very large potential in this region, particularly for the countries of the Pacific Rim, like Japan, which have deep waters and yet vast wind resources offshore.

With so many of the world's largest and fastest growing population centres located at the coast next to deep water, floating offshore wind provides a unique opportunity for the world to meet growing demand for electricity while transitioning into a safer, smarter and greener, future.

Technology challenges • Turbine blades well over 100 metres adapting shape to wind conditions

• Introduction of new materials

• Mooring line and system dynamics

• Multiple wind farms connected to one

(U)HVDC inter-connector


LIVING THE FUTURE TODAYGETTING SMARTER BRINGS YOU FURTHER


Smart grids empower end-users to manage consumption and costs through actionable information and flexible pricing, and will create a prosumer generation: consumers producing electricity. This is not the future. It is today in owerMatching City in Groningen, the Netherlands. Its residents are among the first worldwide to be connected to a fully equipped smart grid with smart meters and appliances that allow end-users to manage their energy consumption.

LIVING THE FUTURE TODAY 45

What is smart about

SMART GRIDS?

Smart grids make the production, transmission, distribution and consumption of power "smarter". In doing so, they provide ways to address many of these challenges. Through a series of new technology applications, services, and operational efficiencies they improve the reliability and security of supply, and facilitate the integration of renewables. Smart grids empower end-users to manage consumption and costs through actionable information and flexible pricing and will create a prosumer generation: consumers producing electricity.


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However, the 'smart grid' is an abstract concept. Its interpretation often leads to misunderstanding and confusion amongst stakeholders. Visualising a smart grid as it actually functions for a real community can help bridge this gap. By educating and engaging stakeholders, the full potential of smart grids can be unleashed - a potential that relies upon consumer participation.

Technical evolution, market revolutionIn an ordinary town in the north of the Netherlands, two neighbours eagerly compare their energy consumption. One proudly points to her smart meter reading, which shows that 75 per cent of the electricity her family consumed in the last month was produced by the local community. Her neighbour is delighted with the savings made since he installed a smart washing machine that waits until supply levels in the grid are high and tariffs are low before running its pre-programmed cycle.

This is not the future. It is today in PowerMatching City in Groningen, the Netherlands. Its residents are among the first worldwide to be connected to a pilot fully equipped smart grid with smart meters and appliances that allow end-users to manage their energy consumption. In the coming decades, millions more people will be connected to commercial smart grids offering similar services.

Yet, behind this story of enthusiastic consumers actively engaged in managing their energy consumption lies profound change. The foundations of this change have been built over many years, as the electricity industry has increasingly adopted information and communication technologies (ICT), and as renewable energy sources (RES) have become integrated into existing grids. Commercial electricity grids are more 'intelligent' and have opened up to consumer-producers (so-called 'prosumers').

Figure 13. A smart washing machine waiting for the best price to start


Figure 14. Overview of existing (blue) and new (red) upcoming assets and energy flows in an energy systemSources: Smart Energy Collective

Getting smarter, going furtherSmart grids turn this evolution into revolution. They add even greater intelligence and real-time monitoring of power flows in the grid. Connected smart appliances and services enable consumers to act on information about their energy usage. And flexible pricing mechanisms let them take advantage of tariffs that vary in line with the available supply and demand at any given moment. The traditional one-way relationship between energy suppliers and consumers is transformed. Network operators and end-users become joint players in balancing loads and improving efficient energy usage – creating entirely new market models and business opportunities.

This transformation will not happen overnight. Network intelligence and the integration of RES have started just this millennium. But smart grids go much further, inter-connecting different types and scales of

power generation and in implementing new services, technologies and business models. The linear value chain from power generator through network operators to consumers is being replaced by a web of relationships of inter-dependent stakeholders. And new players such as ICT companies and service providers are coming into the sector, offering end-users everything from energy efficiency audits to smartphone-based home energy management apps.

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What is smart about smart grids?Smartness refers to the ability to automatically monitor, control and communicate with energy devices, customers and markets on both local and central levels leading to optimisation in the energy value chain. It is an intelligent layer that supports the energy market and the energy grid.

Participation of stakeholdersIn liberalised energy markets today there is a clear division between the physical infrastructure and the energy supply chain as depicted in Figure 14. The physical energy chain is responsible for the physical transport and distribution. The energy value chain implements the commercial processes for the energy produced and consumed. The physical and value chain domains are connected by the Transmission System Operator (TSO) responsible for keeping the system balanced. The administrative processes to coordinate both chains are organised in well-

documented and structured data exchange processes (the information chain).

A smart energy market provides opportunities for new roles and the roles of existing market players shift. Figure 15 and 16 show the new and existing roles in the Universal Smart Energy Framework (USEF) model, which are explained below, starting with the physical energy chain.

The real uptake of new players and roles in the energy market does not follow a linear path. It is more like a transition process in society, with three-steps-forward-two-steps-back characteristics. Worldwide, this process is being pushed through different measures. Dozens of experimental technical pilots are being executed, often with trial-and-error outcome, next to market design efforts such as the USEF13.

Smart grids are built upon three main characteristics

� Automation of the distribution grid (sometimes including the introduction of smart metering for small energy consumers)

� Active participation of small (residential & commercial) consumers into the electricity market mainly through demand side participation/demand response schemes

� High penetrations of distributed energy resources, heat pumps and electric vehicle charging facilities into the grid.

Smart grids are grids with added intelligence


Figure 15. Market roles in liberalised energy markets

Figure 16. Roles in a smart energy market: new (red) and existing (blue)

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Real-life demonstrations and simulations with extensive involvement of novel stakeholders like prosumers, policy makers, aggregators and municipalities are rare. Such demonstrations are needed and must be enhanced in order to stimulate active participation of consumers into the electricity market and enable the introduction of distributed energy resources, heat pumps, electric vehicle charging facilities and other dynamic elements into the grid. DNV GL is putting tremendous effort into this process.

Prosumers, the Groningen caseIn PowerMatching City in Groningen, the Netherlands, a living laboratory smart grid environment has been constructed where residential end-users play a key role. Respectively 22 and 18 inter-connected households are equipped with micro co-generation units, hybrid heat pumps, PV-solar panels, smart washing machines, home energy storage and electric vehicles.

As these residential end-users actively upload and download energy from the grid they become

so-called prosumers. Prosumers offer their flexibility resulting from active demand and supply of energy to the (local) market. Empowered by consumption and production insights, they economically optimize the use of their assets. In PowerMatching City, energy trading on the local market is fully automated through the Powermatcher.

The Powermatcher is a communication protocol that enables all local participants, washing machine, wind farms, grid operators and grid-connected devices to 'talk' to each other. Each device comprises smart operating software (the so-called agent) that is programmed according to the needs of its owner. Based on market information, the agents make the optimal choices over time. The Powermatcher optimises, independently and objectively, the interests of all participants in the system. This is unique in the world.

The innovative technologies offer prosumers the opportunity to conserve energy, produce energy and allow the smart appliances to shift energy consumption to moments when renewable energy is

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Figure 17. Operational decision making in the Powermatcher

abundantly available. The living portal provides households insight into these energy flows, as well as into household energy consumption and production. This situation is totally different from the regular situation in households today.

In the PowerMatching City smart grid laboratory, the 40 participating households try to find a balance between energy saving and home comfort, and to a limited extent become self-supporting as well. This is changing their behaviour, which is a cornerstone in the creation of a smart grid and sustainable energy future.

The PowerMatching City case demonstrates the active participation of consumers into the electricity market and the introduction of distributed energy resources and smart energy devices into the grid. It also showcases how the Solar Revolution for Europe has been described on the pages 24 and 25 of this report would take shape in the real world: a street with houses all equipped with solar panels and some with home energy storage plus a local market place where renewable energy is being traded without any subsidy incentives like net metering or a feed-in tariff, and in an automated way.

LOCALSUPPLY

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Exactly what my boss wants, I’ll start.

Thanks for the message.

It is wind force 8, I’m doing fine.

Now 10% discount.

Sorry, I’m full. My boss leaves in

5 minutes.

Good idea,I’ll fill my buffer.


Figure 18. The prosumer generation

Forty households hardly exchange any power with the medium-voltage distribution grid


DEMONSTRATING A SMART GRID

Our mobile/fixed smart grid demonstration allows:

� 10 participants to interactively simulate a part of a low voltage distribution grid in a real life situation

� Each person to behave like a residential house owner with more or less smart energy devices

� Participants to experiment and experience the consequences of operational choices on the distribution grid

� Participants to actively experience introducing distributed energy resources and electric vehicles

� Adding general information, such as weather conditions, season indicators, and grid parameters

� To understand the opportunities, limitations, business threads and benefits that comes with smart grids

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The mobile version of the simulation facility allows for interactive engagement of smart grid stakeholders anywhere in the world. This mobile multi-media simulation also incorporates a live link to the real-life smart grid district in Groningen. Actual performance ('now') of the smart grid elements in Groningen is displayed. As well as this live data experience, a virtual tour through the smart grid district can be undertaken via a web portal.


LESSONS LEARNED FROM POWERMATCHING CITYResults from a living smart grid

The goal of the PowerMatching City project is to demonstrate that we can build a smart system for the future supply of energy using today's available technologies. The system works well, although not without applying the necessary creativity. A practical trial like this turns out to be extremely well-suited for acquiring insight into what can be achieved with a smart energy system, the changes required for this purpose as well as the hurdles we still need to overcome together. One of the most important lessons learned from Phase 1 is that only through the efforts of all parties along the entire energy chain can it be possible to fully exploit the opportunities inherent in smart grids.

Only the efforts of all parties involved can unveil smart grid opportunities

Technically feasibleThe trial demonstrates that it is technically feasible to allow demand to follow supply, rather than supply following demand as it is today. Measurements from the micro combined heat and power (CHP), the hybrid heat pumps and the charging of electric vehicles all indicate that the system responds quickly to fluctuating demand and maintains comfort levels for the end-user over the long term. This is

favourable for the smooth integration of renewable wind and solar energy, because the energy supply from these sources cannot be controlled. And this is not the entire story. For example, it is evident that there is a need to design appliances, including household appliances, differently. The purpose would be to allow appliances to decide for themselves whether to switch on or off, depending on the current electricity rate, for example, when the


New technologies create flexibility without affecting end-users comfort and system efficiency

rate falls because the supply from renewable sources is high. A heat pump has been designed to supply heat when the consumer has a need, not when the electricity rate is favourable.

The trick is to create flexibility without adversely affecting the end-user's comfort or the system's energy efficiency. This is possible – in this case by temporarily storing the energy in a buffer tank in the form of heat. The battery in electric cars offers similar potential. By charging the battery at a time when electricity is cheapest, it is possible to drive the car at the lowest possible cost. This requires a smart optimisation algorithm: a smart agent. Use of the smart agent shows that end-users buy their electricity at low rates, and sell it at high rates, independent from the type of appliance.

Greater consumer influenceWhat are the changes for the consumer? Initially, little will change. The various technologies offer

sufficient flexibility to allow consumers to retain their freedom of choice without sacrificing comfort or reliability. This enables them to make a contribution to a sustainable energy supply at acceptable costs. The only thing they need to give up in return is space for an additional heat storage tank and/or a battery. Furthermore, they are given detailed insight into their energy consumption, enabling them to make their own decisions concerning the effective use of energy and exploiting savings opportunities.


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Development process in smart grids2010 2020

R&D FeasibilityDemonstration

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Figure 19. Development process in smart grids

The actual practice trial shows that over time, the role of consumers will fundamentally change. Who will supply what service, at which time, and to whom, in the future? Consumers will not only evolve into producers, they will also acquire prominent influence on the demand and supply of energy and consequently on energy supply as whole. This even affects the billing process: who will then be billing whom? Because if consumers are "called on" to supply electricity, or to consume it via rate incentives in order to maintain the balance within the power grid, then they should also be able to financially profit from it.

Adapted regulatory frameworkThe the residents of the 40 the smart grid households in Groningen try to find a balance between energy saving and home comfort, and to a limited extent become self-supporting as well while having access to local energy. In fact, consumers are able to balance personal preferences between 'green, cheap and local energy'. Imagine such freedom of choice for thousands or even all users in a region or country, most of the current regulatory

framework is no longer suitable. To allow users to choose the optimum between 'green, cheap and local energy' at a much larger scale, adaption of the regulatory framework is a prerequisite. Energy tariffs need elements that are based on time and location of generation and use.

The topic of novel regulatory frameworks clearly goes beyond the limits of the real-life demonstrations in Groningen. The working sessions at the smart grid multi-media simulation table are intended to illustrate these issues for stakeholders who actively work on the energy (market) laws and guidelines, like policy makers, governments and regulating bodies.

Getting smarter, going furtherSmart grids have the potential to make the production, transmission, distribution and consumption of power smarter. They can contribute to a safe and sustainable future. Strategic choices must be made before large-scale implementation can successfully take place.


JAPAN'S ENERGY TRILEMMAIS IT FEASIBLE TO DECARBONISE JAPAN'S POWER SECTOR?


The energy policy of Japan is at a crossroads. Traditionally, the country's energy strategy focused on securing reliable and affordable electricity supply, in order to promote economic growth. But over the past decade, promoting environmental protection and fighting climate change became increasingly important. Recent developments have highlighted the need of finding a balance between three conflicting objectives characterising the country's energy trilemma: security of supply, affordable pricing, and clean power generation.

JAPAN'S ENERGY TRILEMMA 61

Three years after the earthquake, tsunami, and successive Fukushima meltdown in March 2011, Japan's energy policy is at a crossroads. Traditionally, the country's energy strategy focused on securing reliable and affordable electricity supply, in order to promote economic growth. But over the past decade, promoting environmental protection and fighting climate change became increasingly important. Recent developments have highlighted the need to find a balance between three conflicting objectives characterising the country's energy trilemma. The nuclear meltdown at the Fukushima Daiichi plant has pushed the role of nuclear power to the centre of recent political debates and emphasised the environmental risks of conventional power systems. The temporary closure of almost all the country's nuclear power plants in 2011/2012 has not only led to severe electricity shortages and supply interruptions. In addition, the surge of gas imports and Asian liquefied natural gas (LNG) prices

has clearly revealed Japan's import dependency and its exposure to increasing costs of primary energy sources.

The discussions on the future direction of Japan's energy policy are ongoing. In response to the Fukushima incident, the Japanese government initially developed plans for a gradual phase-out of nuclear energy, the implementation of ambitious energy efficiency measures and for a stronger role of renewable energies. More recently, however, the Japanese government announced a revision of the country's carbon reduction targets, and that it is reconsidering continued reliance on the use of nuclear energy. While Japan remains dedicated to renewable energy, it is unclear whether it will uphold the ambitious renewable targets pronounced earlier. Overall, the final course of Japan's future energy policy is not set.

Green & Clean

Available & Affordable

Secure & Reliable

Available& Affordable

Green & CleanSecure & Reliable

Figure 20. The Energy TrilemmaSource: DNV GL


Potential pathways for Japan's

FUTURE ENERGY SUPPLYIn the light of these uncertainties, the DNV GL outlook has analysed the feasibility and impact of different development pathways for Japan's energy supply. At the core of the analysis are five scenarios, which reflect several choices on the use of nuclear and renewable energies, the role of energy efficiency and different ambitions with regards to the reduction of carbon emissions. Three of these options are based on recent IEEJ14 scenarios for the year 2030. DNV GL15 has extended these scenarios to 2050 and created two additional scenarios: one with aggressive investment in renewable energy, and one that uses nuclear energy as a bridge.

Figure 21. Scenarios considered by developing the pathwaysSource: DNV GL

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Decarbonising the Japanese power sector is feasibleThe DNV GL outlook shows that power sector decarbonisation represents a realistic choice for Japan but there are several challenges and risks to be addressed. Assuming that a diversified mix of low-carbon technologies, including renewable energy sources, CCS and/or nuclear energy, is used, Japan has multiple options available for reaching or even exceeding an ambitious CO2 reduction target of 80 per cent by 2050. Moreover, all scenarios maintain a similar level of power system reliability as today.

However, prospects are much more limited if neither CCS nor nuclear energy are used. Even when increasing the share of renewables up to approximately 60 per cent, the scope for decarbonisation will decrease to around 60 per cent. And without nuclear energy, fossil fuel consumption may remain at a similar level as before the Fukushima incident.

Similarly, simulation results indicate that reducing carbon emissions will be particularly difficult in the period to 2030. Given that CCS is not expected to become a commercial option in the near future, a rapid decommissioning of nuclear plants would require an increased use of fossil fuel plants, with a negative impact on CO2 emissions. To achieve the 2030 targets, fossil fuel based power production would have to be largely based on natural gas, which requires strong signals to incentivise gas-fired generation, such as strict limits on CO2 emissions and/or high CO2 prices.

Decarbonisation: affordable choice, but major investment challengeSince the Fukushima incident in March 2011, Japan's imports of fossil fuels have increased significantly, in particular of LNG and oil products. In combination with record-high prices on Asian LNG markets, this has led to a growing trade deficit and a major increase in electricity generation costs. Consequently, security of supply and affordability of

Figure 22. Range of carbon emissions from 2010 until 2050Source: DNV GL

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Figure 23. Evolution of electricity supply costs from 2010 until 2050 when nuclear is used as a bridging technologySource: DNV GL, Matsuo et al.16

electricity supply have become the focus of current political discussions. These discussions also raise the question as to whether Japan can afford to switch off its nuclear fleet, and what the impact of a major shift towards renewable energy sources might be on future electricity prices.

Against this background, it is reassuring to note that the overall costs of electricity supply remain broadly comparable across all scenarios considered by the DNV GL outlook. This observation applies to those scenarios without nuclear plants but a high share of RES, as well as an additional 'business as usual' scenario based on the continued use of nuclear power and fossil fuels. Moreover, as illustrated in Figure 23, even in the most ambitious scenario, the average costs of electricity in the year 2050 remain at a similar level as today, despite an 80 per cent reduction of carbon emissions and a 60 per cent share of renewable energies in total electricity production. Clearly, these projections are subject to considerable uncertainty, for instance on the future costs of fossil fuels, nuclear plants or renewable energies. Nevertheless, they do indicate that all of

these scenarios seem to represent an affordable choice for Japan.

Despite this positive outlook, the outlook also shows that the average costs of electricity temporarily increases until 2030. Hence, although Japan may benefit from this in the long term, the necessary transition creates additional challenges during a transitional period. These challenges are further increased as the transition to capital intensive low-carbon technologies requires major investments into generation as well as transmission and distribution networks. Figure 24 shows that annual investment requirements may amount to more than JPY 2.5 trillion (EUR 18 billon) annually over the next two decades. The combined impact of increasing electricity prices and the need to finance these investments would put a significant burden on public as well as private budgets in the next decades.

Resource availability and infrastructure needsMost scenarios in the outlook assume that renewables will play a major role in the future electricity supply of Japan. Apart from investments

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into generation, this development also requires a major expansion of Japan's transmission and distribution networks. As wind and solar resources are unevenly distributed across the country, significant volumes of transmission capacity may be required between different regions, in order to balance supply and demand. At the same time, both transmission and local distribution networks will need to be reinforced, to connect electricity from local sources to the main grid and to demand centres in each region.

Network expansion will require additional investments. Even more important it requires additional transport corridors that may have substantial visual and environmental impacts. As experience from Europe shows, it is essential to limit the need for additional network capacity to the minimum. Additional sensitivity analysis for Europe shows that for instance smart grid technologies, demand response and (de-centralised) storage technologies may help to reduce the need for additional network capacity, as well as maximise the use of electricity available from renewable energy

sources (RES) by limiting curtailment of RES plants, as illustrated in Figure 25.

In Japan, onshore and offshore wind power, as well as solar power, represents the major potential renewable energy sources. But despite the abundant availability of wind and solar power, available resources are distributed across the country highly unevenly. Moreover, the use of onshore wind and solar-PV requires significant space and may easily conflict with other land uses and/or environmental concerns. This is a particular concern given that over two-third of Japan is covered by forest and the landscape is mountainous.

The outlook has put particular emphasis on the uncertainty related to the future mix and regional distribution of renewables and assessed several scenarios with a different mix and regional distribution of wind and solar power, see Figure 26. While the basic scenario distributes each renewable technology to regions with good wind or solar conditions, a first sensitivity analysis is based on a more diversified distribution of wind power17,


Figure 25. Impact of demand response and storage on RES curtailment [GWh]Source: DNV GL

considering the distribution of capacities closer to electricity demand centres. Since both cases assume a very high utilisation of solar-PV (approximately 90 per cent of the useable potential) a second variation finally assumes a reduced use of solar power. The reduction in solar power is compensated by an increasing use of offshore wind, again taking into account wind conditions as well as the distribution of demand across the country.

Figure 26 shows that the impact of these variations on future infrastructure requirements is significant, even though the total overall cost levels remain at the same level in all three cases. The isolated optimisation of wind power in the first sensitivity analysis results in an unintended need for even more transmission capacity than in the original scenario, since additional wind farms are installed in those regions already characterised by excess production from solar power. Conversely, the simultaneous adjustment of all three technologies in the second sensitivity analysis does indeed lead to a drastically reduced need for additional network capacity. See

Figure 25 for the different sensitivity analysis and the impact on transmission capacity.

These observations show that it may sometimes be economically beneficial to build RES plants at less promising locations, in order to save on the cost of network infrastructure. But most important, they show that infrastructure needs are highly sensitive to the mix and regional distribution of wind and solar power. This also highlights the need for a co-ordinated approach since a balanced distribution of wind and solar power can reduce the need for grid expansion, whereas a lack of co-ordination may result in detrimental environmental impacts and additional costs.

Demand response and de-centralised storage help to reduce the need for network expansion

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Figure 25. Impact of demand response and storage on RES curtailment [GWh]Source: DNV GL

Figure 26. Relation between regional distribution and mix of RES and the need for grid expansion Source: DNV GL

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1.3 BILLIONPeople have no access to electricity

280 GW Is the installed wind power capacity worldwide in 2012


44.6 GW New installed wind power worldwide in 2012

100 GW Cumulative installed photovoltaic capacity worldwide in 2013


10% Installed RES capacity increased in the EU in 2012

80-95%The EU could reduce greenhouse gas emissions below 1990 levels by 2050 only by deploying existing technologies

VISIONS FOR A EUROPEAN ENERGY POLICY

1.7 TW Installed RES capacity in Europe in 2050 assuming solar-PV will be the most economic technology

20-20-20 TARGETSPer cent reduction in greenhouse gas emissions, electricity production by renewable energy sources, improvement in energy efficiency in the EU by 2020


80% Is the CO2 and NOx emission reduction when a gas turbine will be replaced by a floating offshore wind turbine on an offshore platform

FLOATING OFFSHORE WIND

1,000-1,500 METRESUltra-deep waters can still be used for floating offshore wind turbines

200-300 t/MWThe most optimized mass/power rate for substructures for floating wind energy turbines

95%Of the ocean coastlines are too deep for bottom-fixed wind turbines

10 MW130 METRES200 METRESOffshore wind turbine output power, hub height, and rotor diameter will be commercially available in the early 2020's

12-14% The cost compression for every doubling of installed onshore wind power


Remote Home Control

LIVING A SMART GRID

0.02%Market share of plug-in electric vehicles of the stock of total registered passenger cars in 2013

18%Potential reduction in CO2 emissions in US electricity sector in 2030 attributable to Smart Grid technologies

64,000Electric vehicle charging stations operational worldwide in autumn 2013

40 Regular households started living a smart grid laboratory in Hoogkerk, the Netherlands

100The PowerMatching City project has been listed in the UN 'Sustania 100' in 2012 as one of the 100 most viable, sustainable solutions

2020The year to start the large-scale implementation of smart grids


JAPAN'S ELECTRICITY TRILEMMA

60%Japan's power sector can decarbonize without the use of nuclear power and carbon capture in 2050

2.7 trillion JPYJapan would need to invest annually over the next two decades in generation, transmission & distribution to finance the transition

13.5 JPY/kWhCan be the levelised costs of electricity in Japan in 2050 using nuclear power as a bridge

30-60% Reduction of fuel imports

44.2 GWOf nuclear power is installed in Japan, generating 30 per cent of the country's electricity before the Fukushima disaster

397 GWInstalled RES capacity in 2050 is feasible


1 "Roadmap 2050 – a practical guide to a prosperous, low-carbon Europe" (April 2010)

2 International Energy Agency, World Energy Outlook 2013 – Executive Summary

3 Institute of Energy Economics Japan: Energy Policy in Japan – Challenges after Fukushima

4 World Wind Energy Association, World Wind Energy Report 2012

5 http://www.roadmap2050.eu/

6 Based on the „High-RES“ scenario in the European Commission's Energy Roadmap 2050, COM (2011) 885/2 and SEC (2011) 1565

7 http://www.statoil.com/en/technologyinnovation/newenergy/renewablepowerproduction/offshore/hywind/pages/hywindputtingwindpowertothetest.aspx (09-09-2012)

8 http://www.japantimes.co.jp/news/2013/11/11/national/floating-wind-farm-debuts-off-fukushima/ (11-11-2013)

9 http://www.japantimes.co.jp/news/2013/11/11/national/floating-wind-farm-debuts-off-fukushima/ (11-11-2013)

10 http://energy.gov/articles/maine-project-launches-first-grid-connected-offshore-wind-turbine-us (31-05-2013)

REFERENCES

11 http://www.npd.no/Publikasjoner/Ressursrapporter/2011/Kapittel-5/ (30-01-2014)

12 EWEA, The European offshore wind industry – key trends and statistics 1st half 2013, 2013

13 USEF: This framework is to provide a set of specifications, designs and implementation guidelines enabling the establishment of a fully functional smart energy system.

14 Institute of Energy Economics Japan: Energy Policy in Japan – Challenges after Fukushima

15 All of the scenarios are based on IEEJ figures for 2030 and have been extrapolated to 2050 using official plans and forecasts for as far as possible. We have used the IEA's World Energy Outlook 2013 and specifically the “450 Scenario” as basis for our assumptions for fuel and carbon prices.

16 Matsuo et al, Historical Trends in Japan's Power Generation Costs and Their Influence on Finance in the Electricity Industry, February 2012, http://eneken.ieej.or.jp/data/4782.pdf

17 As suggested by the Japan Wind Power Association Potential for Introduction of Wind Power Generation and Mid/Long Term Installation Goals (V3.2), 22-02-2012


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DNV GL: Electrifying the Future

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