The first story
Why the world of energy is changing dramatically
and how change will affect us all
Europe has decided to go green and make a significant contribution to climate protection by drastically reducing greenhouse gas emissions. And what’s more, in record time. What does this mean for energy in practice?
- Decarbonisation, a massive shift away from fossil fuels and obsolete energy sources.
- Significant increase in the prices of emission allowances.
- Huge investment in renewables.
The time is coming for a turbulent transformation of the whole energy sector, the effects of which we will all feel. Energy producers, industrial companies, large energy consumers, cities and municipalities, transport and end customers.
01. What does our energy industry look like today?
The main problem of the Czech Republic and the whole region of Central Europe is the fact that the majority of energy production comes from fossil sources. All the more dramatic changes in energy and related impacts can be expected in the near future.
- The entire CEE region is still dependent on fossil fuels (78 %).
- Greater development of RES has only occurred in recent years.
- However, the importance of RES in the overall composition of resources now consists of only 16 %.
- In contrast, coal as a source of primary energy currently makes up approx 25 %.
02. What are the emission reduction targets?
It must be emphasized that the targets are very ambitious to drastic and will have a major impact on the entire energy chain - from the composition of resources through production, distribution to final consumption.
- By 2030, a 50% decrease in greenhouse gas emissions is expected compared to 1990.
- By 2050, the European Union as a whole should be carbon neutral (95% reduction in emissions compared to 1990).
03. What will be the consequences?
There will be a significant slowdown in the use of coal, oil and, in the future, natural gas.
The consequences will also be felt by transport, industry and households (energy generates only a third of emissions).
The share of renewable sources will increase, but it will not be possible without gas-backed backup sources.
As a result of changes and support for electromobility, the demand for electricity will increase significantly.
In the medium term, demand for natural gas (an important transitive fuel) will also increase.
- Electricity will gradually replace fossil energy (by up to 2,600 TWh).
- Electricity will increase the demand for electricity.
- By 2050, we expect an increase in demand of up to 50% (compared to 2019).
04. How much electricity will be missing and where to get it?
The gap between the sharp rise in demand for electricity and the massive decline in its "traditional" sources will widen significantly.
Electricity from RES alone and without backup sources cannot cover the increased demand.
Demand for a number of new production resources will increase enormously.
According to our calculations, in 2050 the CEE region will lack 841 TWh, which is its entire current annual consumption.
Lack of generation resources together with high demand will lead to a sharp rise in electricity prices.
- By 2025, 45-50 GW of torque will be shut down in the CEE region.
- By 2050, 103-142 GW of torque will be shut down in the CEE region.
- By 2025 alone, 190-200 TWh of new sources of electricity generation will need to be found in the CEE region.
05. What will be the situation in the Czech Republic?
Everything that applies to the CEE region applies to the future development of energy in our country.
We assume that by 2030, one-fifth of all operating power plants in the Czech Republic will be shut down.
Ten years later, up to 40% of the currently installed capacity will not be available.
At about the same time, we will change from an electricity exporter to its importer.
- By 2035, approximately 75% of today's coal resources will be shut down.
- The speed of shutting down coal resources will be affected by the price of emission allowances and electricity.
- The horizon of 2050 will reach only NPP Temelín (and theoretically PPC Počerady).
06. How to prepare for change?
It is high time to start preparing for the dramatic transformation of energy and its major impacts in advance. Consider a new energy concept, new sources, new forms of connection to networks.
But first, let's say in the next energy story how much it will all cost.