Updated Strategic Energy Technology Plan to tackle system integration

06 Nov 2013 | News
New framework to be completed in 2014. Key priorities are developing smart electricity grids and industrial value chains, says senior EU official.
By Gail Edmondson
The European Commission will launch an updated Strategic Energy Technology (SET) Plan in 2014 to accelerate the development of a low-carbon energy system.

The new plan will place greater emphasis on the electricity grid and the integration of energy sources, said András Siegler, director of energy at DG Research and Innovation, in an interview with Science|Business. “We need system integration at a higher level. We need technological integration via smart control of the electricity grid – that’s one key issue.”

The original SET Plan included six industrial initiatives in the fields of wind, solar, bioenergy, carbon capture and storage, the electricity grid, nuclear fission, and a Joint Technology Initiative (JTI) on fuel cells and hydrogen; as well as a smart cities initiative – each with designated milestones and investment targets. Total spending was forecast at €71.5 billion through 2020, with only €2 billion earmarked for research and development in the field of electricity grids. By contrast, the investment target for solar technologies was €16 billion and that for carbon capture and storage technologies €16.5 billion. 

A 2012 review of the SET Plan conducted by the Joint Research Centre of the European Commission concluded that the stand-alone technology initiatives undercut the effectiveness of the programme. Going forward, “the glue between the different elements of the SET Plan needs to be stronger,” Siegler said, including the link between new energy technologies and the distribution and the use of energy. 

"The SET Plan has progressed and today Europe is on the right track to foster the development of energy technologies and innovation. However, much remains to be done,” Siegler said. "Energy technology policy needs to embrace a holistic view and link technology push developments to relevant policies and demand-side measures", he said. 

Energy storage technologies, for example, will be among the top priorities under the revised SET Plan. The reason is clear: Renewable energies such as wind and solar flow into the electricity grid in spurts, depending on the amount of sun or wind on a given day. Currently peak flows of renewable energy are wasted because the electricity grid across most of Europe is not capable of storing the energy. So breakthroughs in solar and wind technologies are of limited benefit until researchers crack the storage challenge.

 “Without storage, an integrated energy system is not possible,” said Siegler, who holds degrees in control engineering and mechanical engineering. 

Achieving a sophisticated energy system that can manage intermittent flows from solar, wind and other renewable energy sources will require collaboration across multiple fields from engineering and science sectors to information and communication technologies, he said.  

The updated SET Plan will also support the integration of activities along the innovation chains, from basic research to market, addressing the so-called 'valleys of death'. Energy efficiency will be another key priority.  

To reinforce coordination of actors and investments along the technology value chains, the new framework will also include a focus on industrial supply chains. "Demonstrating solutions and breaking world records have no economic value if not rolled-out to the market and there will be no full economic value for Europe if not backed up by industrial capacities and supply chains able to compete globally,” Siegler said.

Though the integrated roadmap for the revised SET Plan will be completed in early 2014, the first calls under Horizon 2020 that integrate the new priorities will not start until 2015. In a break with the past, Horizon 2020 calls will define energy-related challenges which industry and society are facing and seek bids for solving them. The goal is to move away from a call to develop “a specific technology” and to encourage competition among technologies to solve clearly defined problems. 

“We want to define the challenge in such a way that it’s a problem-solving exercise,” explained Siegler. “Researchers can come up with different technology solutions. We do not want to be very prescriptive – they can use existing technologies or new ones. This approach permits implementing the SET Plan better.” 

The SET Plan’s existing carbon capture and storage programme ran into multiple difficulties from inadequate market conditions, to financial support and public resistance. The original SET Plan envisioned up to 12 demonstration projects, starting operation by 2015 and largely financed by member states and industry. The goal was to demonstrate the technology’s commercial viability in an economic environment driven by the emissions trading scheme. But as the price of carbon plummeted on the Trading System, the economics of CCS collapsed and projects launched in 2010 with €1 billion in Commission funding have stalled or been put on ice.

“The technology probably was not mature enough to go to the demonstration phase,” said Siegler, adding that public acceptance of CCS was also a problem. "There is thus a need for further research and innovation activities such as on improved capture and storage performance, carbon utilization, extending CCS use to industrial sectors, etc."

CCS was not the only programme that struggled to meet its milestones. Across most of its pillars, the SET Plan faced difficulties engaging sufficient support of private industry and governments. Although it may seem impractical to have frequent editions of the SET Plan Roadmaps, the recent experiences with the financial crisis, technology and sectoral market developments and the evolving challenges to the European energy system beyond 2020 point to the need for a higher degree of responsiveness, the JRC review noted. 

Nevertheless, Siegler insisted that the overall impact of the SET Plan has been positive, noting that public and private investments in technological development for the SET Plan sectors increased from €3.2 billion in 2007 to €5.4 billion in 2010. Industry makes about 70% of the total research and innovation investment in the SET Plan priorities while Member States account for about 20 per cent and the European Commission for 10 per cent.

Siegler explained that the new plan will be designed for greater adaptability to evolving technologies and changing market conditions – and that key European Union states, including Germany and the UK, are now committed to partnering on SET Plan priorities. “One has to understand the whole SET Plan concept was new….So it needed time and experience,” said Siegler, who conceded member state and industry collaboration got off to a bumpy start. “It’s a cultural issue. The readiness is much more there today.” 
 
In particular, the new SET Plan roadmap will include an investment plan with concrete funding commitments by member states and the Commission. In another sign of change, the steering groups that oversee each of the SET Plan industrial initiatives have set up coordinated or joint member state actions in fields such as bioenergy and wind, Siegler said. “From 2007 to today, there has been a lot of change in mentality. The coordinated and joint investments between Member States and with the EU will be further fostered to leverage private sector investments in support of the SET Plan objectives."

Siegler predicted that the pace of development of grid-based technologies in particular will speed up under the next phase of the SET Plan. The goal for the electricity grid pillar under the original SET Plan was to be able to integrate up to 35 per cent of renewable electricity in a seamless way, and operate a smart grid by 2020 capable of matching supply and demand. “This is also about energy security,” he said. “That is a reason for an integrated grid and two-directional flow of energy in itself. We see this as a big development.”

Siegler said the first phase of the SET Plan was a test of the feasibility of the entire concept and that the technologies chosen have proven to be the right ones. “The role of phase 2 to is to fix the things that are fixable, to encourage and support further development and improvements in energy technology performance while reducing costs, to permit more advanced technologies to prove their maturity, to strengthen technology supply chains, and to address systems integration aspects, enabling the flexibility of the energy system, addressing both supply and demand side measures and building the link to policies in the field.”

The technology push elements of the SET Plan, however, should have limits, Siegler said, noting that EU funds would only be channelled to R&D that could not be done by member states and industry. “If someone says, ‘Give our industry money because it is moving to Asia,’ – without a concept – they will not get it,” he said.  “This is not a policy to have 100,000 flowers blossom at every price.”

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