Decarbonizing the European electricity sector

This dissertation uses three models to analyze different decarbonization strategies for combating global climate change: The cost minimizing mixed-integer model CCTS-Mod examines the economics of Carbon Capture, Transport, and Storage (CCTS) for the electricity and industry sector; the welfare maximizing quadratically constrained model ELMOD focuses on different trajectories for renewable energy sources (RES) and transmission grid expansions; and the equilibrium model ELCO combines the insights of the individual sectors to a combined CCTS and electricity investment and dispatch model. Modeling results show that an investment in CCTS is beneficial for the iron and steel sector once the CO2 certificate price exceeds 50 €/t CO2. The threshold is 75 €/t CO2 for the cement industry and 100 €/t CO2 for the electricity sector. Additional revenues from using CO2 for enhanced oil recovery (CO2-EOR) lead to an earlier adoption of CCTS in the North Sea region. The lack of economies of scale results in increasing CO2 storage costs of more than 30%, while transport costs even double. Research from the last years, however, indicates that CCTS is unlikely to play an important role in decarbonizing the electricity sector. The identified reasons for this are incumbents’ resistance to structural change, wrong technology choices, over-optimistic cost estimates, a premature focus on energy projects instead of industry, and the underestimation of transport and storage issues. Keeping global temperature rise below 2°C therefore implies the phase-out of fossilfueled power plants and, in particular, of CO2-intensive coal power plants. The low CO2 price established by the European Emissions Trading Scheme is insufficient to induce a fuel switch in the medium term. Therefore, supplementary national measures are necessary to reduce coal-based power generation; i.a. feed-in tariffs for RES, minimum CO2 prices, or emissions performance standards. Analyses for Germany show that a coal phase-out before 2040 is possible without risking resource adequacy at any point. Enabling a smooth transition encourages other countries to take the German Energiewende as a blueprint to combat global warming, even if this implies a coal phase-out.

Author dc:creator

• Oei, Pao-Yu Charly Robin

Advisor dc:contributor.advisor

• Hirschhausen, Christian von

Licence dc:rights.uri

• https://creativecommons.org/licenses/by/4.0/

Language dc:language.iso

en

Identifier URI

http://dx.doi.org/10.14279/depositonce-5065

OAI identifier oai:identifier

oai:depositonce.tu-berlin.de:11303/5390