Impact of Efficiency Improvements on the Energy System: 2000 W Society Concept in Perspective

1. Impact of Efficiency Improvements on the Energy System: 2000 W Society Concept in Perspective Stefan Hirschberg NEEDS Forum 3 Cairo, Egypt, 28 January 2008 NEEDS Forum 3

2. Content • Introduction: 2000 W Society • Swiss energy system • Historical importance of increasing energy efficiency • Goals for future increase of energy efficiency • Energy efficiency potential in Switzerland and impacts on Swiss energy supply • Economic and ecologic efficiency • Conclusions

3. The vision of the 2000-Watt society Source: novatlantis Non-fossil fuels Other Renewables Fossil fuels Hydro Power Technological reduction potential Nuclear fuels Watt per capita Fossil fuels ETH-domain vision of 2000 Watt society: „Aspiration of achieving economic growth as planned, while using distinctly less primary energy and clearly reducing CO2 emissions“.

4. Human development Index vs. energy consumption Source: Energy-Mirror No.18, 2007

5. Thesis I • Swiss energy system performs well compared to other countries: • Relatively low primary energy demand & CO2-emissions • Reasons: • Structure of the energy system –Hydro and nuclear power for electricity production • Structure of the economy –few energy intensive industries, extensive service sector

6. End Energy 890‘440 TJ Primary Energy 1‘132‘660 TJ Households 29.6% Industry 19.5% Services 16.7% Traffic 32.5% Agriculture1.7% Source: BFE 2006 Energy flows in Switzerland (2005) 66% fossil

7. Greenhouse gas emissions, Switzerland, direct & indirect (grey) Source: BAFU 2007

8. Thesis II Efficiency improvements have played a very important role in the past and will do so also in the future.

9. Impact of efficiency Improvements on energy consumption Source: IEA (2007)

10. Impact of structural changes on energy consumption Industry: Structural & „real“ efficiency improvements,1982-1998 Source: Unander 2007

11. Energy intensity of the economy: CH / EU In the 1990‘s, yearly increase in energy efficiencywas ~1.4%; since year 2000, the rate decreasedto only ~0.5% current policy is NOT sufficient EU: Switzerland Energy intensity [MJEnd energy per GDP (CHF1990)] Schweiz Source:BFE 2006

12. Energy Efficiency: one step towards less CO2 emissions Source: Energie-Spiegel No.10, 2003

13. Thesis III Efficiency improvements are necessary and highly important but alone not sufficient to respond to the principle goals of sustainable energy policies.

14. Increase byfactor 1.5(IPCC 2000) Needs to be reduced by factor of 3 to reach the goal Goal: Reduction by50% until 2050 Needs to be reduced by factor of 5 to reach the goal Increase by factor 1.65(1% growth per year) Needs to be reducedby factor of 2 to reachthe goal Decrease by factor 2.5(-1.8% per year in alternativescenario of IEA 2004) Necessitates very strong expansionof ”carbon-free” energy sources Kaya Equation Implications CO2 Emissions = Carbon content of energy x Energy intensity x Production x Populationof economyper person

15. Increase byfactor 1.5(IPCC 2000) Needs to be reduced by factor of 3 to reach the goal Goal: Reduction by50% until 2050 Needs to be reduced by factor of 6.5 to reach the goal Increase by factor 2.15(1.6% growth per year) Needs to be reducedby factor of 4 to reachthe goal Decrease by factor 1.6(-1% per year) Necessitates very strong expansionof all “carbon-free” technologies Kaya Equation Implications CO2 Emissions = Carbon content of energy x Energy intensity x Production x Populationof economyper person

16. Thesis IV We can reduce energy consumption in Switzerland by use of most efficient technologies until 2050 by maximum 30%. Energy efficiency alone does not guarrantee a substantial reduction of fossil fuel uses and thus CO2-emissions. Very ambitious reductions of CO2-emissions do not necessarily require reaching the 2000 Watt level per person.

17. Swiss energy system (2050): reduced primary energy consumption & CO2-emissions Primary Energy per capita target No limit CO2 reduction per decade 2010 - 2050 Source: Schulz 2007

18. Additional costs in efficiency scenarios Primary Energy per capita target CO2 reduction per decade 2010 - 2050 No limit Source: Schulz 2007

19. Thesis V A substantially higher energy efficiency is feasible in Switzerland – especially in the building and transport sectors. → energy consumption can be substantially reduced.

20. Heat supply in households(Scenario 3.5 kWPE / -10% CO2 per decade) Source: Schulz 2007

21. Mobility: End energy consumption 3.5 kWPE / -10% CO2 pro Decade 3.5 kWPE Sopurce: Schulz 2007

22. Thesis VI Electricity in the future will be more important than ever for our service economy. Therefore maintaining CO2-free electricity production will be decisive for enabling effective and ambitious reduction of CO2-emissions.

23. Electricity generation in CH (2050) with lower energy consumption & CO2-emissions 2005: 57,9 TWh Primary Energy per capita target No limit CO2 reduction per decade 2010 - 2050 Source: Schulz 2007

24. Thesis VII Total (internal plus external) costs of energy systems (though controversial) reflect economic & ecologic efficiency of the various options. Accounting for external costs is favourable to renewables and nuclear. Technology improvements can change the „ranking“ of the options – some renewables have the most promising improvement potentials.

25. Total costs of current and future electricity supply systems Source: Hirschberg et al., 2007

26. Electricity from New renewables: Potential & costs (CH) Costs [Rp/kWh] 2004 Shares in total electricity production 2035 2000 2035 Small hydro 5-25 2.0% 4-20 < 1 MW 20-40 10-30 3.6 - 5.5% Biomass No unitoperational 7-15 0 - 3.6% Geothermal 12-25 1.1% 12-15 Wind power 0.2 - 4.9% 50-90 Photovoltaic 22-42 0% 1% 2% 3% 4% 5% 6% PSI-GaBE/BFE Energieperspektiven; Hirschberg et al. 2005

27. Conclusions • Explicit goals are needed for the strong reduction of CO2-emissions. The goal of just reducing primary energy is not adequate. • We need ambitious but realistic goals for 2050:3–4 t CO2 per capita with maximum 1500-2000 Watt fossil energy. • Transformation of our overall energy system, in particular of energy use in residential and transportation sectors, is needed and requires targeted long-term policy measures. • The transformation is associated with sizeable costs. • The production of electricity will increase substantially. • Efficiency improvements are of central importance for meeting the main sustainable policy goals. They are part of a mix of several options that also includes carbon-free technologies.