ESPON applied research project ReRisk 2013/1/5ESPON applied research project ReRisk 2013/1/5

P j t O i R i t Ri k f E P tProject Overview - Regions at Risk of Energy Poverty

Global view of the risk of energy poverty of the European regions

To assess which are the policy options available to regions in order tocope with this challenge

Long-term options for improving demand-side elasticities to rising g p p g genergy pricing (scenario exercise)

Web tool which will permit:

At regional levelAt regional levelo to introduce your own region’s data o to evaluate weaknesseso to define policies to

reduce the risk of energy povertyAt European level

o To obtain a global view of the real risks of the different regionso To establish adequate European policieso To establish adequate European policies

Energy prices – a major political concern in Europe

European Commission, June 2008

“These high price levels are squeezing the purchasing power of all EU citizens, with the most severe impact on the lowest income families, and putting a strain on business. Energy income families, and putting a strain on business. Energy intensive sectors, as well as transport and agriculture, and in particular fisheries, are most affected and face a difficult adjustment process.”

European Economic and Social Committee on the ‘Proposal for a Directive of the European Parliament and of the Council on the energy performance of buildings , November 2009

“In accordance with the policy goals of the EU, the Member States must ensure that renovation of buildings in order to enhance their energy efficiency reduces not just energy enhance their energy efficiency reduces not just energy demand but also energy costs.”

h l bl iThe most vulnerable regions

Economic vulnerability: regions in which a high share of wealth creation or employment depends on industries with high energy spending

Region

Employment in industries with

high energy h / t t l

creation or employment depends on industries with high energy spending

R i

GVA of industries with high energy spending / total

i l GVA (%) purchases / total employment (%)

Moravskoslezsko 14.23%

Emilia-Romagna 13.91%

Region regional GVA (%) Moravskoslezsko 25.13% Groningen 22.36% Principado de Asturias 21.02%

Strední Morava 12.75%

Severovýchod 12.52%

Friuli-Venezia Giulia 12.50%

Lombardia 12.37%

Asturias 21.02% Severozápad 20.37% Pais Vasco 18.40% Comunidad Foral de Navarra 17.82% Ni d b 16 84%

Lombardia 12.37%

Norra Mellansverige 12.14%

Veneto 12.09%

Severozápad 11.49%

ý

Niederbayern 16.84% Castilla-la Mancha 16.76% Prov. Brabant Wallon 16.44% Emilia-Romagna 16 25%

Jihovýchod 11.33%

Piemonte 10.95%

Marche 10.41%

Emilia Romagna 16.25% Strední Morava 16.04% Sterea Ellada 15.79% Zeeland 15.71% Severovýchod 15.64%

h l bl iThe most vulnerable regions

Transport dependence can be measured by the % of employment in the transport sector commuting the cost of employment in the transport sector, commuting, the cost of

freight transport and the extent of air travel

Fuel costs as % Region

Fuel costs as % of GDP 2005

Severen tsentralen 14.22 %

Yugoiztochen 8.18 %

Swietokrzyskie 7.99 %

Severoiztochen 7.16 %

Yuzhen tsentralen 6.72 %

Lubuskie 6.67 %

Podlaskie 6.59 %

Severozapaden 6.39 %p

Strední Cechy 6.27 %

Región de Murcia 6.13 %

h l bl iThe most vulnerable regions

Social vulnerability is strongly related to the levels of poverty in the i L t l t d l t f i ti itregions. Long-term unemployment and low rates of economic activity

are two of the most important reasons why people slide into poverty.

Regions with the lowest activity rates

Region

Economic Activity Rate, 2005

(%)

Calabria 41.7

Puglia 42.1

Sicilia 42.1

S d 42 9Severozapaden 42.9

Campania 42.9

Molise 43.0

Basilicata 43 8Basilicata 43.8

Észak-Magyarország 45.0

Észak-Alföld 45.6

d d d i d f li di iEnergy demand derived from climate conditions

Source: JRC - IPSC -MARS Unit

i i h i lRegions with potential

Source: JRC, Renewable Energies UnitSource: ETC/ACC - EEA

k-means clustering (4 clusters)Normalised and

weighted variables weighted variables

•Climate conditions• mean max temperature July• mean min temperature January)

•Economic structure• % employment in industries with high energy purchases (x2)

•Transport dependency• fuel costs of freight transport• % workers commuting

•Social vulnerability• long-term unemployment rate• disposable income in households)

•Production potential of renewables• wind power potential• PV potential)

Caracteristics of the four regional clusters

S i kiScenario making process

• The scenario building activity is based on explorative prospective -G l M h l i l A l i (MA)General Morphological Analysis (MA)-

– Workshop I• Identification of key drivers Identification of key drivers

– Online survey• Actors and policy developments

– Case studies • Approaches on managing energy vulnerability and impacts on

regional competitiveness– Literature studies

• EU trends and policies• EU trends and policies– Workshop II & Workshop III

• Formulation of hypotheses• Configuration and selection of the scenariosg

l k i h fA look into the future

• An oil price of 200$ or more and increasing difficulties to access the

Basic assumptions for the ReRisk scenarios• An oil price of 200$ or more, and increasing difficulties to access the

remaining fossil fuel resources due to international competition, will change the rules in the energy sector and will alter priorities in many other policy areas.

• Regional energy policy is embedded in a national, European and international framework, which determines to a large extent the options available for coping with higher energy prices at regional level.

• The ReRisk scenarios have the objective of making the possible future frameworks transparent and to identify both threats and opportunities for “winning” and “loosing” regionswinning and loosing regions

• Important processes of long-term structural change will have to be initiated now in order to reduce the vulnerability of the most affected

i d t t th l f titiregions and to prevent the loss of competitiveness

Objective: to define sound responses on regional level

Some elements of scenario buildingSome elements of scenario building

1. Green high 2. Energy-ffi i t 3. The big 4. Long -1. Green high

tech efficient Europe

3. The big nuclear

4. Long lasting crisis

Emphasis on renewable

Emphasis on fossil energy Emphasis on Emphasis on

fossil energy renewable energy

fossil energy (gas) nuclear fossil energy

(coal)

High innovation it

Moderate innovation

Moderate innovation Low innovation

itcapacity innovation capacity

innovation capacity capacity

High presence of the service

Balanced presence of all

High presence of the primary Negative

economic of the service and knowledge economy

presence of all sectors in the economy

and manufactory industry

economic growth

I i -Urban and rural growth

-Urban and rural growth

-Urban and rural growth

-Increasing settlement centralization

S h llSome challenges1. Green high tech

2. Energy-efficient Europe

3. The big nuclear

4. Long -lasting crisis

-Time demanding -Limited CO2

reduction

-Dependence on imported

-Increases in CO2 emissions

process-Increasing dependency on

reduction-Increasing dependence on natural gas

uranium-Increased exposure to large scale black outs

2-Limited economic resources

-Displacement on renewables

-Need for economic

-Exposure to volatile energy prices

-Structural

scale black outs-Risk of wasting electricity

-Energy sector d d b

Displacement of part of Europe’s industries

fresources-Increased competition for land

Structural changes in the economies towards less

i t i

dominated by monopoles

-Opportunities for growth only for

-Increase of social problems, especially in urban areasfor land

(conflicts of interest)

energy intensive industries

growth only for few privileged (urban) regions

urban areas-Low competitiveness

S i iSome opportunities

1. Green high tech 2. Energy-efficient Europe

3. The big nuclear

4. Long -lasting crisisp g

- Major CO2reductions

- Diversification of

-Less resource demanding adaptation

-Low and stable electricity prices in the

-Low tech, low cost solutionsDiversification of

energy supply mix- Activation of the

rural economiesO i i f

adaptation towards high energy prices

-Major energy i

prices in the short term

-Minor structural h i h

solutions-Behavioural changes in energy

i- Opportunities for innovation

- Urban-rural integration

savings-Diversification of industry

-Expansion of

changes in the economy

-Good conditions for

consumption-Opportunities for near-by tourist integration

- Less traffic congestion in urban areasP esence of a la ge

Expansion of the knowledge and service industryLess

conditions for energy intensive industries ( ith

tourist regions

-Opportunities for regions

ith o n - Presence of a large number of energy producers

-Less competition for land

(with electricity demand)

with own energy resources

G id li li d iGuidelines on Policy Recommendations

• Higher energy prices will put forward higher demands of innovation, economic diversity, accessibility and good governance.

• While rising energy prices will result in structural changes in regions new business opportunities may appear in all scenarios regions new business opportunities may appear in all scenarios.

• Transport, especially for freight appears as one of the most challenged sectors by high prices on fuels.

• The availability of renewable energy (for instance wind and • The availability of renewable energy (for instance wind and solar exposed areas) will represent a clear competitive factor for regions rich in these resources. However, several barriers have to be overcome while a high degree of innovation will be

drequired. • In the short term, energy efficiency and saving appear as

suitable solutions for all scenarios in order to mitigate the negative effects of rising energy prices negative effects of rising energy prices.

Why? How?Where?

Strategy for Policy Recommendations

Policy FrameworkIdentification of Policy

Priority AreasConfiguration of

Policy Recommendations

Implementation and available instruments

Recommendations

Context Analysis Vulnerability Assessment Structured around Set criteria for policies

selection and Context Analysisand Future Scenarios Clustering of Regions

• Indicators• Scenarios

• Policy surveillance,E t lt ti

• By regional typologies• By level of implementation

guidelines for implementation

• Scenarios• Case Studies

• Experts consultation By level of implementation• By kind of action Feedback

Revision of the basis

Revision of vulnerability

Efficacy and Efficiencythe basis vulnerability and Efficiency

d li d i

Targeted energy policy recommendations to regional vulnerability profiles

Towards policy recommendations

Spatial Planning Strategies and Instruments:

Integrated Spatial Planning Instruments: land use, energy and water management towards sustainable development

At regional and local level

towards sustainable development Implementation of Industrial Ecology approach in Urban Master Plans: adoption

of the concept of Urban Metabolism. Requires integration of sector policies.Industrial Symbiosis for deployment processes (new industrial sites)

Public private partnerships to encourage investment on alternative/ renewablePublic-private partnerships to encourage investment on alternative/ renewable energy production and increasing involvement of private companies and society

* All previous initiatives require Good Governance

Human and Social behaviour

Attractive socio-technical and ethnographic approach to design focused on supporting the user in optimal use of productssupporting the user in optimal use of products

Inclusion of energy issues in educational plansAt national level

d li d i

Energy planning in the context of Climate Change At regional and local level

Towards policy recommendations

Generation of downscaled scenarios at regional level and beyond, and accurate regional studies in order to define appropriate adaptation measures, such as

Vulnerability Assessment of Energy Production and Distribution InfrastructuresHydropower and nuclear plants facing extreme events, particularly floods

in continental Europe and Eastern European regions (Romania and Hungary) / and droughts in Southern and Mediterranean regions

Transboundary and coastal flood risk managementEvaluating possible climate change impacts on renewable production (wind

speeds, energy crops, ocean technologies…)Implementation of emergency plans at regional and local level to prevent

premature deaths during heat waves in Southern regions based on climate scenarios

Boosting the innovative capacity and knowledge base

Generation of maps of untapped regional energy reserves

At regional and local level

p pp g gyRegional research driven by Clusters to accelerate technology deployment,

innovation capacity and diffusion.